Colvert v. Astrue (CONSENT)
MEMORANDUM OPINION AND ORDER, pursuant to 42 U.S.C. § 406(b), that counsels petition (Doc. 25 ) is GRANTED to the extent that counsel is authorized to charge her client the amount of $9,500.00 in attorneys fees for the 17.7 hours of work p erformed before the court. It is further ORDERED that plaintiffs counsel is DIRECTED to take the steps necessary to ensure that plaintiff is credited or refunded the amount of $3,195.91, the amount of the fees previously awarded to plaintiff pursuant to the Equal Access to Justice Act. Signed by Honorable Judge Susan Russ Walker on 9/2/2015. (dmn, )
IN THE DISTRICT COURT OF THE UNITED STATES
FOR THE MIDDLE DISTRICT OF ALABAMA
KEITH DEREK COLVERT,
CAROLYN W. COLVIN,
Acting Commissioner of Social Security,
CIVIL ACTION NO. 2:11CV293-SRW
MEMORANDUM OPINION and ORDER
Plaintiff brought the present action pursuant to 42 U.S.C. § 405(g) seeking judicial
review of a decision by the Commissioner of Social Security denying him benefits under the
Social Security Act. (Doc. # 1). This court entered judgment reversing the decision of the
Commissioner and remanded the case for further proceedings pursuant to sentence four of
§ 405(g). (Doc. # 17). This court previously awarded plaintiff fees pursuant to the Equal
Access to Justice Act (“EAJA”), 28 U.S.C. § 2412(d)(1)(A), in the amount of $3,195.91
(Doc. # 21).
This action is presently before the court on the plaintiff’s counsel’s petition, pursuant
to 42 U.S.C. § 406(b), for authorization to charge her client the amount of $12,029.22 for
17.7 hours of work performed in prosecuting plaintiff’s appeal before this court.1 The
42 U.S.C. 406(b) provides as follows:
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
Commissioner responds that, while she does not generally take a position on § 406(b) fee
requests, she will notify the court if it appears that a fee agreement or petition conflicts with
the statute or case law; she notes no such concern in the present case. (Doc. # 27).
The contingency fee agreement between plaintiff and his attorney provides, in part,
In the event of a favorable determination before the Social Security
Administration at the Appeals Council level; or at the ALJ hearing level after
a decision by the Appeals Council or Federal Court; or if a Federal Court
favorably decides my case, the $5,300.00 limitation shall not apply and the
fee shall be 25% of all past-due benefits payable to me and my family.
(Exhibit A to Doc. # 25 at ¶ B)(emphasis in original). Plaintiff’s counsel’s petition does not
indicate whether the favorable decision on plaintiff’s claim was rendered by Appeals Council
itself or “at the ALJ hearing level” upon remand from the Appeals Council. However, in
either event, the agreement provides for an attorney fee in the amount of twenty-five percent
of past due benefits under the first clause of paragraph B of the fee agreement, if the Appeals
Council issued the favorable decision (with or without further remand to an ALJ), or under
the second clause, if an ALJ issued favorable decision.
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, and the Commissioner of Social Security may,
notwithstanding the provisions of section 405(i) of this title, but subject to subsection
(d) of this section, certify the amount of such fee for payment to such attorney out of,
and not in addition to, the amount of such past-due benefits. In case of any such
judgment, no other fee may be payable or certified for payment for such
representation except as provided in this paragraph.
In Gisbrecht v. Barnhart, 535 U.S. 789 (2002), the Supreme Court examined the issue
of attorney’s fees sought in connection with contingency fee agreements in Social Security
disability cases. The Court held that “§ 406(b) does not displace contingent-fee agreements
as the primary means by which fees are set for successfully representing Social Security
benefits claims in court. Rather § 406(b) calls for court review of such arrangements as an
independent check, to assure that they yield reasonable results in particular cases.” Id. at
807. The burden is on the attorney for the claimant to “show that the fee sought is reasonable
for the services rendered.” Id.
The amount that counsel asks the court to approve ($12,029.22) is the balance of
twenty-five percent of plaintiff’s past-due benefits ($88,116.90),2 after deducting the
$10,000.00 fee that plaintiff’s counsel has asked the Commissioner to authorize for work
performed at the administrative level.3 Counsel argues that she “has spent a total of 67.80
hours over a period of 77 months representing the plaintiff in connection with [his] claim for
Social Security Disability Benefits.” (Doc. # 25, ¶ 4). As counsel further notes, however,
only 17.7 hours of the total hours were spent on work before this court. (Id.).4
See Exhibit C to Petition (Doc. # 25-3).
See Doc. # 25, ¶ 5.
Plaintiff’s counsel seeks fees for time she spent on June 14, 2012 receiving and reviewing
the “U.S. Attorney’s Motion for Entry of Judgment under Sentence Four” and an order and
memorandum opinion granting such motion. (Doc. # 25-2, Exhibit B to petition). The
Commissioner filed no such motion. However, this court’s memorandum opinion and judgment
reversing the Commissioner’s decision issued on that date. Thus, despite counsel’s erroneous
description of the service performed, the court concludes that counsel actually worked on this case
on June 14, 2012, for the length of time reflected in Exhibit B.
Plaintiff’s counsel, who bears the burden of establishing the reasonableness of the
requested fee, relies on orders issued by Judge Guin in the Northern District of Alabama
authorizing the maximum fee permitted under the statute. In all of these cases, Judge Guin
relied, in part, on the high quality of the work in the case before him. However, to the extent
that these orders also reflect the view that a 25% contingency fee is always reasonable in
Social Security appeals,5 the court cannot agree; Gisbrecht instructs that the court is to review
the fee resulting from a contingent fee agreement for reasonableness, based on the facts of
the particular case before it. See Gisbrecht, 535 U.S. at 808 (“Courts that approach fee
determinations by looking first to the contingent-fee agreement, then testing it for
reasonableness, have appropriately reduced the attorney’s recovery based on the character
of the representation and the results the representative achieved.”). The Supreme Court
observed that if the “benefits are large in comparison to the amount of time counsel spent on
the case, a downward adjustment is . . . in order.” Id.
Upon review of this court’s record, including the brief that counsel filed in support
of plaintiff’s claim, the court finds that counsel has failed to carry her burden of showing that
the requested fee is reasonable. In light of the presentation of the issues in this particular
action, and the amount of time spent in prosecuting plaintiff’s appeal to this court, the court
See Doc. # 25-4, p. 3 (observing that no fee is awarded in a large number of social security
appeals in which the Commissioner’s decision is affirmed, that the plaintiff in the case before Judge
Guin probably would not have received past due benefits “without adequate legal representation at
the District Court level,” and stating, “Ensuring the availability of adequate legal representation is
one of the primary reasons for the contingent fee system in social security cases. In the absence of
contingent fee agreements, and awards by the courts based on those agreements, most claimants
would find it impossible to obtain competent legal representation. This is a strong reason for finding
the requested fee reasonable. But the best reason is that the 25 percent contingent fee agreement is
the only prevailing fee.”).
finds that a downward adjustment of the fee from $12,029.22 to the amount of $9,500.00
renders an award that largely preserves the benefit of counsel’s contingent fee agreement
with her client and compensates her reasonably for her work.6
Accordingly, it is
ORDERED, pursuant to 42 U.S.C. § 406(b), that counsel’s petition (Doc. # 25) is
GRANTED to the extent that counsel is authorized to charge her client the amount of
$9,500.00 in attorney’s fees for the 17.7 hours of work performed before the court.
It is further ORDERED that plaintiff’s counsel is DIRECTED to take the steps
necessary to ensure that plaintiff is credited or refunded the amount of $3,195.91, the amount
of the fees previously awarded to plaintiff pursuant to the Equal Access to Justice Act.
DONE, this 2nd day of September, 2015.
/s/ Susan Russ Walker
SUSAN RUSS WALKER
CHIEF UNITED STATES MAGISTRATE JUDGE
Assuming that the Commissioner authorizes plaintiff’s counsel to charge her client $10,000
for the 50.1 hours of work expended at the administrative level, the total fee would amount to more
than twenty two percent of plaintiff’s past due benefits. The fee authorized for work in this court
equates to compensation at an hourly rate of $536.72, approximately three times the maximum
hourly rate available under the EAJA for the same work. (See Doc. # 20, pp. 3-4).
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