Opinion
CIVIL 1:21-CV-01161-RP-SH
02-01-2024
LAURA FOSTER, Plaintiff v. MARTIN O'MALLEY,[1] COMMISSIONER OF THE SOCIAL SECURITY ADMINISTRATION, Defendant
REPORT AND RECOMMENDATION OF THE UNITED STATES MAGISTRATE JUDGE
TO: THE HONORABLE ROBERT PITMAN UNITED STATES DISTRICT JUDGE
Now before the Court are Plaintiff's Motion for and Memorandum in Support of Award of Attorney's Fees Under 42 U.S.C. § 406(b) of the Social Security Act, filed October 26, 2023 (Dkt. 23), and Defendant's Response, filed November 2, 2023 (Dkt. 24). The District Court referred this case to this Magistrate Judge pursuant to its Standing Order, 28 U.S.C. § 636(b)(1)(B), Federal Rule of Civil Procedure 72, and Rule 1(h) of Appendix C of the Local Rules of the United States District Court for the Western District of Texas. Dkt. 5.
I. Background
On September 21, 2018, Plaintiff Laura Foster applied for Disability Insurance Benefits under Title II of the Social Security Act, 42 U.S.C. § 401, et seq., alleging a disability onset date of March 1, 2013. Dkt. 1. The Commissioner denied the Application after finding that Plaintiff was not disabled within the meaning of the Act. After exhausting her administrative appeals, Plaintiff filed this suit challenging the Commissioner's decision under 42 U.S.C. § 405(g).
After Plaintiff filed her initial brief, the Commissioner of Social Security filed an unopposed motion to reverse and remand this action for further administrative proceedings under sentence four of 42 U.S.C. § 405(g). Dkt. 13. The District Court granted Defendant's unopposed motion and reversed and remanded the case to the Commissioner to conduct further proceedings. Dkt. 15.
Plaintiff then moved for attorney's fees and costs under the Equal Access to Justice Act (“EAJA”), 28 U.S.C. § 2412(d). Dkt. 18. This Magistrate Judge issued a Report and Recommendation finding that Plaintiff was the prevailing party and entitled to $6,446.89 in attorney's fees and costs. Dkt. 20. The District Court adopted the Report and Recommendation and awarded Plaintiff her requested fees and costs. Dkt. 22.
The EAJA requires the government to pay the fees and expenses of a “prevailing party” unless the government's position was “substantially justified.” 28 U.S.C. § 2412(d)(1)(A). If a claimant qualifies as a “prevailing party” at any intermediate stage in a Social Security case, a court may deem the claimant to be a prevailing party for purposes of § 2412(d). Parrish v. Comm'r of Soc. Sec. Admin., 698 F.3d 1215, 1218 (9th Cir. 2012).
After the Commissioner conducted further administrative proceedings on Plaintiff's application, she issued “a fully favorable decision finding Plaintiff disabled beginning March 1, 2013,” Dkt. 23 at 1, and awarded her $112,518.90 in past due disability benefits. Notice of Award, Dkt. 23-2. Plaintiff's counsel now seeks $16,129.73 in attorneys' fees. The Commissioner does not oppose the Motion for Attorney's Fees but states that “[i]t is for the Court to decide if the request for attorney's fees under 42 U.S.C. § 406(b) is reasonable under the law.” Dkt. 24 at 1.
II. Legal Standards
Section 406(b) of the Social Security Act governs the award and collection of fees by attorneys for the representation of Social Security claimants in court. Section 406(b) provides:
Whenever a court renders a judgment favorable to a claimant under this subchapter who was represented before the court by an attorney, the court may determine and allow as part of its judgment a reasonable fee for such representation, not in excess of 25 percent
of the total of the past-due benefits to which the claimant is entitled by reason of such judgment.
42 U.S.C. § 406(b)(1)(A). In Gisbrecht v. Barnhart, 535 U.S. 789, 800 (2002), the Supreme Court clarified that Section 406(b) permits “contingent-fee contracts that produce fees no higher than the 25 percent ceiling.” Courts must review such arrangements “as an independent check, to assure that they yield reasonable results in particular cases.” Id. at 807. “Within the 25 percent boundary . . . the attorney for the successful claimant must show that the fee sought is reasonable for the services rendered.” Id.
To determine whether a fee request is reasonable, courts may look to various factors, including the attorney's experience; the character of the representation and results achieved; any delay in the case caused by the attorney; the time spent on the case in comparison to the benefits received; risk of loss; percentage of the past-due benefits the fee constitutes; and degree of difficulty. Id. at 808; Jeter v. Astrue, 622 F.3d 371, 382 (5th Cir. 2010).
[T]he court may require the claimant's attorney to submit, not as a basis for satellite litigation, but as an aid to the court's assessment of the reasonableness of the fee yielded by the fee agreement, a record of the hours spent representing the claimant and a statement of the lawyer's normal hourly billing charge for noncontingent-fee cases.Gisbrecht, 535 U.S. at 808.
III. Analysis
Under her contingency fee agreement, Plaintiff agreed to pay her attorney, Michael Kelly, a fee equal to 25% of the past due benefits awarded to her in the case. Dkt. 23-4. As stated, Plaintiff was awarded $112,518.90 in past due benefits. Dkt. 23-2 at 4. Kelly asks for an award of $16,129.73, which is 14% of Plaintiff's past due benefits, below the statutory maximum. The Court must determine whether that amount is reasonable or constitutes a “windfall” to Plaintiff's attorneys. Gisbrecht, 535 U.S. at 808.
A. The Fees Requested Are Reasonable
Kelly and his law partner, Martin Long, have practiced disability law for about 30 years and so have significant experience in this practice. Dkt. 23-6 at 2, 4. They seek fees for 27.6 of the 28.6 hours their timesheets show they spent on this case, which makes their “effective hourly rate” -the requested fee amount based on the contingency fee agreement divided by the number of hours expended - $584.41 for purposes of § 406(b). Dkt. 23-3. Courts have found similar hourly rates reasonable in contingency fee Social Security appeals. See Martinez-Nieves v. Kijakazi, No. SA-20-CV-00538-ESC, 2023 WL 1944096, at *2 (W.D. Tex. Feb. 10, 2023) (finding that effective hourly rate of $477.95 “falls well within, if not below, amounts that have been approved by courts as reasonable under similar circumstances”); Brown v. Comm'r of Soc. Sec. Admin., No. 3:18-CV-0190-BH, 2022 WL 1156019, at *3 (N.D. Tex. Apr. 19, 2022) (“Counsel's resulting hourly rate of $480.769 falls well below amounts that have been approved by courts as reasonable.”).
Kelly and Long's usual hourly rate for Social Security work without a contingency fee agreement is $463.00. Dkt. 23 at 10.
The Court finds that the fees are reasonable considering the character of the representation and the results achieved. See Hensley v. Eckerhart, 461 U.S. 424, 435 (1983) (“Where a plaintiff has obtained excellent results, his attorney should recover a fully compensatory fee.”). Plaintiff's attorneys have caused no delay, and the time spent on the case in comparison to the benefits received does not result in a windfall to them. Gisbrecht, 535 U.S. at 808. The Court finds that the fee request is reasonable and recommends that it should be awarded to Plaintiff's counsel.
B. EAJA Reimbursement
While fee awards may be made under both Section 406(b) and the EAJA, “the claimant's attorney must refund to the claimant the amount of the smaller fee” to avoid double recovery. Gisbrecht, 535 U.S. at 796. Because the District Court awarded Plaintiff $6,044.89 under the EAJA for the same services that are subject to this Motion, if the District Court adopts this Report and Recommendation, Plaintiff's attorneys must reimburse Plaintiff any fees previously received under the EAJA.
IV. Recommendation
For these reasons, this Magistrate Judge RECOMMENDS that the District Court GRANT Michael Kelly's Motion for Attorney's Fees under 42 U.S.C. § 406(b)(1)(A) (Dkt. 23) and ORDER that Michael Kelly is entitled to attorney's fees in the amount of $16,129.73, to be paid out of Plaintiff's past due benefits under U.S.C. §406(b)(1), and shall reimburse Plaintiff the $6,044.89 in fees he received under the EAJA.
V. Warnings
The parties may file objections to this Report and Recommendation. A party filing objections must specifically identify those findings or recommendations to which objections are being made. The District Court need not consider frivolous, conclusive, or general objections. See Battle v. United States Parole Comm'n, 834 F.2d 419, 421 (5th Cir. 1987). A party's failure to file written objections to the proposed findings and recommendations contained in this Report within fourteen (14) days after the party is served with a copy of the Report shall bar that party from de novo review by the District Court of the proposed findings and recommendations in the Report and, except on grounds of plain error, shall bar the party from appellate review of unobjected-to proposed factual findings and legal conclusions accepted by the District Court. See 28 U.S.C. § 636(b)(1); Thomas v. Arn, 474 U.S. 140, 150-53 (1985); Douglass v. United Servs. Auto. Ass'n, 79 F.3d 1415, 1428-29 (5th Cir. 1996) (en banc).