Ferraro v. Social Security Administration, Commissioner
Filing
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MEMORANDUM OPINION AND ORDER GRANTING IN PART 15 First MOTION for Attorney Fees in the amount of $6,262.50 as set out. Signed by Judge Virginia Emerson Hopkins on 7/24/2018. (KWC)
FILED
2018 Jul-24 AM 11:17
U.S. DISTRICT COURT
N.D. OF ALABAMA
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ALABAMA
EASTERN DIVISION
STEPHEN FERRARO,
Plaintiff,
v.
NANCY A. BERRYHILL, ACTING
COMMISSIONER, SOCIAL
SECURITY ADMINISTRATION
Defendant.
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) Case No.: 1:14-CV-2413-VEH
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MEMORANDUM OPINION AND ORDER1
I.
INTRODUCTION
Before the Court is Mr. Ferraro’s Petition for Authorization of Attorneys’ Fees
(the “Petition”) under § 406(b) submitted on May 14, 2018. (Doc. 15). Mr. Ferraro’s
attorney requests $14,910.50 in fees for 16.7 hours of work. (See id. at 2). The
Commissioner opposes the Petition by arguing that the fees are not reasonable. (See
Doc. 17 at 2). The Petition is now ripe for review. For the reasons stated in this
opinion, the Petition is GRANTED in part and otherwise DENIED.
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Nancy A. Berryhill was named the Acting Commissioner on January 23, 2017. See
https://www.ssa.gov/agency/commissioner.html. Under 42 U.S.C. § 405(g), "[a]ny action
instituted in accordance with this subsection shall survive notwithstanding any change in the
person occupying the office of Commissioner of Social Security or any vacancy in such office."
Accordingly, pursuant to 42 U.S.C. § 405(g) and Rule 25(d) of the Federal Rules of Civil
Procedure, the Court has substituted Nancy A. Berryhill for Carolyn W. Colvin in the case
caption above and HEREBY DIRECTS the clerk to do the same party substitution on CM/ECF.
II.
STANDARD
Subparagraph 406(b)(1)(A) provides that "[w]henever a court renders a
judgment favorable to a [represented] claimant . . . the court may determine and allow
. . . a reasonable [attorney's fee], not in excess of 25 percent of the total of the past-due
benefits." 42 U.S.C. § 406(b)(1)(A). Where the claimant and his attorney have
executed a contingent-fee agreement, the Supreme Court has interpreted subsection
406(b) as requiring district courts to conduct a two-step analysis. See Gisbrecht v.
Barnhart, 535 U.S. 789 (2002). First, the Court calculates whether the requested
award falls "within the 25 percent limit." Jackson v. Comm'r of Soc. Sec., 601 F.3d
1268, 1271 (11th Cir. 2010). If so, the agreement is presumptively reasonable. In step
two, the Court must consider whether "the fee sought is [actually] reasonable for the
services rendered," Gisbrecht, 535 U.S. at 807, and, if not, the presumption is
overcome. Where the presumption is overcome, the Court may award a fee that is
reasonable in its judgment. See id.
The standard set out in Gisbrecht is a framework that has been subsequently
bolstered by Courts of Appeals. "[C]ourts may reduce the requested fee if the
representation has been substandard, if the attorney has been responsible for delay, or
if the benefits are large in comparison to the amount of time the attorney spent on the
case." Jackson, 601 F.3d at 1271 (citation omitted). Substandard representation,
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among other things, includes a complaint "submitted on boilerplate pleadings," where
"no issues of material fact are present," and where "no legal research is apparent."
Rodriquez v. Bowen, 865 F.2d 739, 747 (6th Cir. 1989).
The reasonable fee reflects an enhancement, compared to the market rate for
similar work, based on the risk of non-payment, because "payment for an attorney in
a social security case is inevitably uncertain." Wells v. Sullivan, 907 F.2d 367, 370–71
(2d Cir. 1990). On the other hand, the quality of counsel and hours expended are weak
factors for assessing an award's reasonableness; they "bear little if any relationship to
the results [i.e., award amount] achieved." Rodriquez, 865 F.2d at 747. But the award
must not be so disproportionate to the work performed that it gives the perception that
counsel has won the Social Security lottery. McGuire v. Sullivan, 873 F.2d 974, 981
(7th Cir. 1989) (prohibiting a "windfall"); cf. Perdue v. Kenny A. ex rel. Winn, 559
U.S. 542, 559 (2010) (fee shifting statutes do not exist to enrich counsel).
Certain policy considerations should also inform the Court's judgment. Section
406 was enacted "to encourage effective legal representation of claimants by insuring
lawyers that they will receive reasonable fees." Dawson v. Finch, 425 F.2d 1192, 1195
(5th Cir. 1970). Contingent fees, in particular, "provide[] a critical incentive for able
attorneys to practice in the social security field." Wells, 907 F.2d at 371. At the same
time, the Court's review is the only defense for claimants, see Bergen v. Comm'r of
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Soc. Sec., 454 F.3d 1273, 1276 (11th Cir. 2006), against the gutting of their statutory
entitlement by the "specialized Social-Security bar [that] charges uniform contingent
fees (the statutory maximum of 25%), which are presumably presented . . . on a
take-it-or-leave-it-basis." Gisbrecht, 535 U.S. at 812 (Scalia, J., dissenting).
III.
ANALYSIS
First, the Court notes that, according to the Social Security Administration,
$14,910.50 is exactly 25% of the past due benefits. (See Doc. 15-3). Thus, it is
“presumptively” reasonable. The Court now determines whether this amount is
“actually” reasonable. The Court determines that it is not.
Mr. Ferraro’s attorney worked 16.7 hours. (See Doc. 15-4 at 1). $14,910.50
divided by 16.7 equals about $892.84 per hour. In the Court’s experience, $892.84 per
hour represents a windfall. As this Court has noted in the recent past, $250 is an
appropriate effective hourly rate. See e.g., Hunter v. Berryhill, No. 7:13-CV-2142VEH, 2017 WL 1132900, *2 (N.D. Ala. Mar. 27, 2017). In this case, Mr. Ferraro’s
attorney’s work was on par with the average attorney who practices social security law
in the Northern District of Alabama. Accordingly, $250 multiplied by 16.7 leads to
a figure of $4,175. However, recovery is not certain in social security cases. With that
enhancement in mind, the Court determines that $6,262.50 is reasonable.
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IV.
CONCLUSION
Accordingly, the Petition is GRANTED in part. $6,262.50 in attorney’s fees
are hereby awarded.
DONE and ORDERED this 24th day of July, 2018.
VIRGINIA EMERSON HOPKINS
United States District Judge
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