Opinion
18-CV-9214 (VEC) (JLC)
11-02-2022
YOLANDA SANTIAGO, Plaintiff, v. COMMISSIONER OF SOCIAL SECURITY, Defendant.
The Honorable Valerie E. Caproni, United States District Judge
REPORT & RECOMMENDATION
JAMES L. COTT, UNITED STATES MAGISTRATE JUDGE.
Following a stipulated remand and the subsequent award of benefits, Yolanda Santiago has now moved for approval of attorney's fees pursuant to 42 U.S.C. § 406(b) in this social security case. For the reasons which follow, I recommend that the motion be granted.
I. BACKGROUND
A. Facts & Procedural History
On April 25, 2016, Santiago filed an application for social security disability benefits. Affirmation of Daniel Berger dated June 17, 2022 (“Berger Aff.”), Dkt. No. 24, ¶ 1. The Social Security Administration (“SSA”) denied her claim, and Santiago requested a hearing before an Administrative Law Judge (“ALJ”). Id. ¶ 1. On May 1, 2018, following a hearing, the ALJ denied her claims, and Santiago appealed the decision. Id. ¶ 1. The Appeals Council denied Santiago's appeal and on October 9, 2018, 1 she filed a pro se complaint in federal court. Id. ¶¶ 1, 3. Santiago retained Daniel Berger (“Berger”) as her counsel on December 7, 2018. Id. ¶ 2; Berger Aff. Ex. A.
On June 13, 2019, Santiago filed a motion for judgment on the pleadings and a memorandum in support. Dkt. Nos 16-17. On July 18, the parties agreed to remand the case for further proceedings, Dkt. No. 18, and that same day, the Court entered an order remanding the case. Dkt No. 19. On August 9, 2019, the parties stipulated that the SSA would pay $6,050.00 in attorney's fees under the Equal Access to Justice Act (“EAJA”), 28 U.S.C. § 2412. Dkt. No. 22.
Upon remand, Santiago appeared again before an ALJ on April 6, 2022 and by decision dated May 25, 2022, the ALJ found Santiago to be disabled. Berger Aff. ¶ 5. As part of the retainer agreement, Santiago agreed to pay 25% of the past due benefits payable to her as payment to Berger for legal services. Id. ¶ 2; see also Berger Aff. Ex. A, ¶ 1.
By Notice of Award dated June 11, 2022, the SSA informed Santiago that she was entitled to past due benefits. Id. ¶ 9; see also Berger Aff. Ex. C. In the Notice of Award, the SSA also stated that it withheld $39,944.00 (or 25% of the past due benefits) “to pay [Santiago's] representative.” Berger Aff. Ex. C.
On June 17, 2022, Santiago filed this motion for attorney's fees pursuant to 42 U.S.C. § 406(b). Dkt. No. 23. In her motion papers, Santiago seeks a court order (1) approving an attorney's fees award of $39,944.00 for 32.20 hours of work performed, and (2) stating that once the fees are awarded, Berger will return the 2 previously received EAJA fee of $6,050.00. Memorandum of Law in Support of Plaintiff's Motion for Approval of Attorney's Fees (“Pl. Mem.”), Dkt. No. 25 at 3-4. On June 29, 2022, the Commissioner filed a response to Santiago's motion in her limited role “resembling that of a trustee for the claimant[].” Dkt. No. 26, Defendant's Response to Plaintiff's Counsel's Motion For Fees Pursuant to 42 U.S.C. § 406(b) (“Comm'r Resp.”) at 2 (citing Gisbrecht v. Barnhart, 535 U.S. 789, 798 n.6 (2002)).
II. DISCUSSION
A. Legal Standards
Pursuant to Section 206(b) of the Social Security Act, “[w]henever a court renders a judgment favorable to a claimant . . . 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,” as long as the fee does not exceed “25 percent of the total of the past-due benefits to which the claimant is entitled.” 42 U.S.C. § 406(b)(1)(A). Even if the claimant agreed to a contingency fee arrangement, Section “406(b) calls for court review of such arrangements as an independent check.” Gisbrecht, 535 U.S. at 807. To do so, courts must first determine whether “the contingency percentage is within the 25% cap . . . [and] whether there has been fraud or overreaching in making the agreement.” Dorta v. Saul, 3 No. 18-CV-396 (JLC), 2021 WL 776446, at *1 (S.D.N.Y. Mar. 1, 2021) (quoting Wells v. Sullivan, 907 F.2d 367, 372 (2d Cir. 1990)).
In addition, the Second Circuit has held that the 14-day filing period for attorneys' fees set forth in Federal Rule of Civil Procedure 54(d)(2)(B) is applicable to § 406(b) motions. See Sinkler v. Berryhill, 932 F.3d 83, 89 (2d Cir. 2019). “[T]he fourteen-day filing period starts to run when the clamant receives notice [from the agency] of the benefits calculation.” Sinkler, 932 F.3d at 91. In this case, Santiago's motion was initially filed on June 17, 2022, which was 6 days after the SSA's June 11, 2022 Notice of Award letter. Dkt. Nos. 24, 25; Berger Aff. Ex. C. Therefore, as the Commissioner acknowledges, Santiago's motion is timely. Comm'r Resp. at 3; Pl. Mem. at 3.
A court must then consider the following factors to determine the reasonableness of a requested award:
1) whether the requested fee is out of line with the “character of the representation and the results the representation achieved”; 2) whether the attorney unreasonably delayed the proceedings in an attempt to increase the accumulation of benefits and thereby increase his own fee; and 3) whether “the benefits awarded are large in comparison to the amount of time counsel spent on the case,” the so-called “windfall” factor.Nieves v. Colvin, No. 13-CV-1439 (WHP) (GWG), 2017 WL 6596613, at *1 (S.D.N.Y. Dec. 26, 2017) (quoting Gisbrecht, 535 U.S. at 808), adopted by 2018 WL 565720 (Jan. 24, 2018); see also Wells, 907 F.2d at 371 (“best indicator of the ‘reasonableness' of a contingency fee in a social security case is the contingency percentage actually negotiated between the attorney and client”). With respect to the third factor - whether a requested fee would be a “windfall” - courts consider several factors, including:
1) whether the attorney's efforts were particularly successful for the plaintiff, 2) whether there is evidence of the effort expended by the attorney demonstrated through4
pleadings which were not boilerplate and through arguments which involved both real issues of material fact and required legal research, and finally 3) whether the case was handled efficiently due to the attorney's experience in handling social security cases.Dorta, 2021 WL 776446, at *2 (quoting Joslyn v. Barnhart, 389 F.Supp.2d 454, 456-57 (W.D.N.Y. 2005)).
The Second Circuit recently directed that in determining whether a requested fee award is a windfall, a district court must consider more than the lodestar calculation and de facto hourly rate. Fields v. Kijakazi, 24 F.4th 845, 854 (2d Cir. 2022). Instead, a “court's primary focus should be on the reasonableness of the contingency agreement in the context of the particular case.” Id. at 853 (quoting Wells, 907 F.2d at 371). “[E]ven a relatively high hourly rate may be perfectly reasonable, and not a windfall, in the context of any given case.” Id. at 854.
B. Analysis
As a threshold matter, the requested fee is 25% of Santiago's past due benefits, as negotiated in the fee agreement, and there is no evidence of “fraud or overreaching” in reaching the agreement. Wells, 907 F.2d at 372; Berger Aff. ¶ 10. Moreover, in this case, each of the reasonableness factors weighs in favor of approving the attorney's fees request.
With respect to the quality of representation, Berger reviewed a more than 600-page administrative record, Berger Aff. Ex. B, was able to successfully negotiate a remand to the SSA, and ultimately secured an award of past due benefits for Santiago. See, e.g., Cruz v. Saul, No. 17-CV-3951 (GBD) (JLC), 2020 WL 3965345, at *2 (S.D.N.Y. Jul. 14, 2020) (attorney provided quality representation after reviewing record and securing remand that resulted in award of past due benefits), 5 adopted by 2020 WL 6491692 (Nov. 4, 2020). Moreover, there is nothing in the record to suggest that counsel unreasonably delayed the proceedings.
With respect to whether the requested fees may amount to a “windfall,” Berger's efforts were “particularly successful” given that he ultimately secured Santiago more than $159,000 in past due benefits. See, e.g., Fields, 24 F.4th at 855 (attorneys' efforts were “particularly successful” when claimant received fully favorable decision from SSA and six-figure award of past-due benefits); Dorta, 2021 WL 776446, at *2 (attorney's efforts were “particularly successful” when he secured more than $100,000 in past due benefits for claimant) (citing Gisbrecht, 535 U.S. at 808).
Additionally, Berger's de facto hourly rate is $1,240.50 ($39,944 / 32.2 hours = $1,240.50). Berger Aff. ¶¶ 7, 9. Although it is on the higher end, it “is [still] within the range of effective hourly rates that have previously been deemed reasonable by courts in this Circuit.” Dorta, 2021 WL 776446, at *2 (citations omitted); see also Muniz v. Comm'r of Soc. Sec., No. 18-CV-8295 (KMK) (PED), 2020 WL 8340078, at *3-4 (S.D.N.Y. Dec. 15, 2020) (hourly rate of $1,257.15 not windfall) (collecting cases), adopted by 2021 WL 293381 (Jan. 28, 2021). Furthermore, given his expertise in handling social security cases, see Berger Aff. ¶ 8, Berger was able to efficiently negotiate a remand of Santiago's case without engaging in extensive briefing and spending numerous hours litigating the case in federal court. Fields, 24 F.4th at 854 (requested fees reasonable when attorneys' “specialization and expertise” allowed them to operate efficiently). 6 Lastly, because contingency agreements like the one here present risks of non-payment, “any reasonable fee award must take account of that risk.” Nieves, 2017 WL 6596613, at *2 (quoting Wells, 907 F.2d at 371).
With respect to the previous $6,050.00 EAJA fee award, where a plaintiff's counsel received fees for the same work before a district court under the EAJA and § 406(b), counsel must refund to the plaintiff the amount of the smaller fee. See Gisbrecht, 535 U.S. at 796 (“Congress harmonized fees payable by the Government under EAJA with fees payable under § 406(b) out of the claimant's past-due Social Security benefits in this manner: Fee awards may be made under both prescriptions, but the claimant's attorney must refund to the claimant the amount of the smaller fee.”) (internal quotations and citations omitted). Accordingly, Santiago appropriately reports that Berger will return the previously received $6,050.00 EAJA fee award. Pl. Mem. at 3-4.
III. CONCLUSION
For these reasons, the Court recommends that the motion be granted.
PROCEDURE FOR FILING OBJECTIONS
Pursuant to 28 U.S.C. § 636(b)(1) and Rule 72(b) of the Federal Rules of Civil Procedure, the parties shall have fourteen (14) days from service of this Report to file written objections. See also Fed.R.Civ.P. 6. Such objections, and any responses to such objections, shall be filed with the Clerk of Court, with courtesy copies delivered to the chambers of the Honorable Valerie E. Caproni, United States 7 Courthouse, 40 Foley Square, New York, NY 10007. Any requests for an extension of time for filing objections must be directed to Judge Caproni.
FAILURE TO FILE OBJECTIONS WITHIN FOURTEEN (14) DAYS WILL RESULT IN A WAIVER OF OBJECTIONS AND WILL PRECLUDE APPELLATE REVIEW. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72. See Thomas v. Arn, 474 U.S. 140 (1985); Wagner & Wagner, LLP v. Atkinson, Haskins, Nellis, Brittingham, Gladd & Carwile, P.C., 596 F.3d 84, 92 (2d Cir. 2010). 8