Woods v. Berryhill
Filing
28
MEMORANDUM AND OPINION that plaintiff's counsel, Lassiter's motion for allowance of fees as part of the judgment under 42:406(b) (Doc. 24) is GRANTED in the amount of $6,648.65 to be paid from plaintiff's recovered past-due benefits. Signed by Magistrate Judge Katherine P. Nelson on 8/10/20. (srr)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
MARYLYN MARIE WOODS,
Plaintiff,
v.
ANDREW M. SAUL,
Commissioner of Social Security,1
Defendant.
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CIVIL ACTION NO. 1:17-00452-N
MEMORANDUM OPINION AND ORDER
This action is before the Court on the motion for allowance of fees as part of
the judgment under 42 U.S.C. § 406(b) (Doc. 24) filed by Byron A. Lassiter, Esq.,
counsel of record for Plaintiff Marylyn Marie Woods.2 The Defendant Commissioner
of Social Security (“the Commissioner”) has filed a response stating that he “neither
supports nor opposes” the motion (Doc. 27).3 Upon due consideration, the Court
As the parties note, having been sworn in on June 17, 2019, Commissioner of Social
Security Andrew M. Saul, as successor to Acting Commissioner Nancy A. Berryhill,
is automatically substituted as the Defendant in this action under Federal Rule of
Civil Procedure 25(d). (See https://www.ssa.gov/agency/commissioner.html &
https://blog.ssa.gov/social-security-welcomes-its-new-commissioner (last visited Aug.
7, 2020)). This change does not affect the ability to conduct any proceedings in this
action. See 42 U.S.C. § 405(g) (“Any 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.”). The Clerk
of Court is DIRECTED to update the docket heading accordingly.
1
A Social Security claimant’s attorney is the real party in interest to a § 406(b)
award. Gisbrecht v. Barnhart, 535 U.S. 789, 798 n.6 (2002).
2
3 “A
§ 406(b) fee is paid by the claimant out of the past-due benefits awarded.”
Jackson v. Comm'r of Soc. Sec., 601 F.3d 1268, 1271 (11th Cir. 2010). “[T]he
Commissioner of Social Security…has no direct financial stake in the answer to the §
406(b) question; instead, she plays a part in the fee determination resembling that of
finds that Lassiter’s motion is due to be GRANTED.4
I.
Background
Plaintiff Woods, at all times represented by Lassiter, brought this action
under 42 U.S.C. § 405(g) for judicial review of an unfavorable final decision of the
Commissioner denying her April 16, 2015 application for a period of disability and
disability insurance benefits (“DIB”) under Title II of the Social Security Act, 42
U.S.C. § 401, et seq. In accordance with the Court’s scheduling order (Doc. 3), the
Commissioner filed his answer (Doc. 9) to the complaint and the certified record of
the relevant administrative proceedings (Docs. 10), Woods filed her fact sheet and
brief identifying alleged errors in the Commissioner’s final decision (Doc. 11), and
the Commissioner filed his brief contesting Woods’s claims of error (Doc. 12). With
the Court’s consent, the parties subsequently waived the opportunity for oral
argument, and this action was taken under submission on the briefs and the
administrative record. (See Docs. 15, 18).
On October 11, 2018, the Court reversed the Commissioner’s final decision
and remanded for further proceedings under sentence four of § 405(g). (See Docs. 19,
20). No appeal was taken from that judgment. Woods subsequently filed a motion for
attorney fees under the Equal Access to Justice Act (“EAJA”), 28 U.S.C. § 2412 (Doc.
a trustee for the claimants.” Gisbrecht, 535 U.S. at 798 n.6.
With the consent of the parties, the Court designated the undersigned Magistrate
Judge to conduct all proceedings in this civil action in accordance with 28 U.S.C. §
636(c), Federal Rule of Civil Procedure 73, and S.D. Ala. GenLR 73. (See Docs. 16,
27).
4
21), which the Court granted in the amount of $3,520.35. (See Doc. 23).5
Following remand, an Administrative Law Judge (“ALJ”) with the Social
Security Administration’s (“SSA”) Office of Disability Adjudication and Review
issued a favorable decision for Woods on her DIB application. (See Doc. 24,
PageID.652, ¶ 5). A notice of award computing Woods’s past-due benefits was issued
on June 9, 2020. (See Doc. 24-2). Lassiter filed the present § 406(b) motion on June
18, 2020.
II.
Analysis
Under 42 U.S.C. § 406(b), “[w]henever a court renders a judgment favorable to
a [DIB] 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, 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). “42 U.S.C. § 406(b) authorizes an award of attorney’s fees where[, as
here,] the district court remands the case to the Commissioner of Social Security for
further proceedings, and the Commissioner on remand awards the claimant
past-due benefits.” Bergen v. Comm'r of Soc. Sec., 454 F.3d 1273, 1277 (11th Cir.
“[S]uccessful Social Security benefits claimants may request a fee award under the
EAJA. Under the EAJA, a party that prevails against the United States in court
may be awarded fees payable by the United States if the government's position in
the litigation was not ‘substantially justified.’ 28 U.S.C. § 2412(d)(1)(A). EAJA fees
are awarded to the prevailing party in addition to and separate from any fees
awarded under 42 U.S.C. § 406(b). See Gisbrecht, 535 U.S. at 796, 122 S. Ct. at 1822;
Reeves v. Astrue, 526 F.3d 732, 736 (11th Cir. 2008). Unlike § 406(b) fees, which are
taken from the claimant’s recovery, EAJA fees are paid from agency funds.”
Jackson, 601 F.3d at 1271.
5
2006) (per curiam).6
a.
Timeliness
Federal Rule of Civil Procedure 54(d)(2), which “applies to a § 406(b)
attorney’s fee claim[,]” Bergen, 454 F.3d at 1277, provides that, “[u]nless a statute or
a court order provides otherwise, [a] motion[ for attorney’s fees] must be filed no
later than 14 days after the entry of judgment.” Fed. R. Civ. P. 54(d)(2). In its order
remanding Woods’s case, the Court granted “Woods’s counsel an extension of time in
which to file a petition for authorization of attorney’s fees under 42 U.S.C. § 406(b)
until thirty days after receipt of a notice of award of benefits from the Social Security
Administration.” (Doc. 19, PageID.633).7 The notice of award of benefits attached to
Lassiter’s motion is timestamped as received on June 15, 2020. (See Doc. 24-2,
PageID.664). Lassiter’s present motion was filed three days later and is therefore
timely.
“Under 42 U.S.C. § 406(b)(2), it is a criminal offense for an attorney to collect fees
in excess of those allowed by the court.” Jackson, 601 F.3d at 1271. See also
Gisbrecht, 535 U.S. at 795-96 (“The prescriptions set out in §§ 406(a) and (b)
establish the exclusive regime for obtaining fees for successful representation of
Social Security benefits claimants. Collecting or even demanding from the client
anything more than the authorized allocation of past-due benefits is a criminal
offense. §§ 406(a)(5), (b)(2) (1994 ed.); 20 CFR §§ 404.1740–1799 (2001).”).
6
See Blitch v. Astrue, 261 F. App'x 241, 242 n.1 (11th Cir. 2008) (per curiam)
(unpublished) (“In Bergen v. Comm'r of Soc. Sec., 454 F.3d 1273 (11th Cir. 2006), we
suggested the best practice for avoiding confusion about the integration of Fed. R.
Civ. P. 54(d)(2)(B) into the procedural framework of a fee award under 42 U.S.C. §
406 is for a plaintiff to request and the district court to include in the remand
judgment a statement that attorneys fees may be applied for within a specified time
after the determination of the plaintiff's past due benefits by the Commission. 454
F.3d at 1278 n.2.”).
7
b.
Reasonableness
In Gisbrecht v. Barnhart, the Supreme Court considered 42 U.S.C. § 406(b)
and clarified its impact on the district court's role in awarding a reasonable
fee following a favorable claim for Social Security benefits. See 535 U.S.
789, 807, 122 S. Ct. 1817, 1828, 152 L. Ed. 2d 996 (2002). Although §
406(b)(1)(A) gives district courts the power to “determine and allow as part
of its judgment a reasonable fee” following a favorable claim for Social
Security benefits, 42 U.S.C. § 406(b)(1)(A), it does not empower them to
ignore the fee agreements entered into by parties when determining what
a reasonable fee would be, see Gisbrecht, 535 U.S. at 807, 122 S. Ct. at 1828
(concluding that “ § 406(b) does not displace contingent-fee agreements as
the primary means by which fees are set”). Instead, courts must look to the
agreement made by the parties and independently review whether the
resulting fee is reasonable under the circumstances. Id. Accordingly, [a
court] must look to the fee agreement made by [a claimant] and his
attorney.
Keller v. Comm'r of Soc. Sec., 759 F.3d 1282, 1284 (11th Cir. 2014). “[T]he
agreement, not the statute, provides the ‘primary means by which fees are set.’ ”
Id. (quoting Gisbrecht, 535 U.S. at 807).
In retaining Lassiter, Woods entered into an attorney fee agreement (Doc.
24-3) which provides, in relevant part, as follows:
2.
It is understood and agreed that I will pay an attorney’s fee that
will be 25% of the combined gross retroactive benefits from Social
Security and Supplemental Security Income (SSI) resulting from a
favorable award of the Commissioner, prior to any reduction under
Section 1127(a) of the [Social Security] Act.
3.
It is understood that the term “combined gross retroactive
benefits”, as used herein, represents the total amount of money which I
and any auxiliary beneficiary or beneficiaries become entitled through
the month before the month SSA effectuates a favorable administrative
determination or decision on my Social Security claim and that SSI
past-due benefits are the total amount of money from which I become
eligible through the month SSA effectuates a favorable administrative
determination or decision on my SSI claim.
The Court finds no reason to believe that this fee agreement violates §
406(b)(1)(A). However,
[Gisbrecht further] explained that even when a contingency agreement
complies with the statutory limit and caps the fee at 25 percent of the
claimant’s benefits award, “§ 406(b) calls for court review of [contingency
fee] arrangements as an independent check, to assure that they yield
reasonable results in particular cases.” [535 U.S.] at 807, 122 S. Ct. at
1828.
Even when there is a valid contingency fee agreement, Gisbrecht sets forth
certain principles that a district court should apply to determine if the
attorney's fee to be awarded under § 406(b) is reasonable. See id. at 808,
122 S. Ct. at 1828. Under Gisbrecht the attorney for the successful social
security benefits claimant must show that the fee sought is reasonable for
the services rendered. Id., 122 S. Ct. at 1828. The district court may reduce
the fee based on the character of the representation and the results
achieved; and if the recovered benefits are large in comparison to the time
the claimant's attorney invested in the case, a downward adjustment may
be in order. Id., 122 S. Ct. at 1828. The Gisbrecht Court held that Ҥ 406(b)
does not displace contingent-fee agreements within the statutory ceiling [of
25 percent of the claimant's recovered benefits]; instead, § 406(b) instructs
courts to review for reasonableness fees yielded by those agreements.” Id.
at 808–09, 122 S. Ct. at 1829.
Thomas v. Astrue, 359 F. App'x 968, 974-75 (11th Cir. 2010) (per curiam)
(unpublished) (footnote omitted). See also Jackson, 601 F.3d at 1271 (“Assuming that
the requested fee is within the 25 percent limit, the court must then determine
whether ‘the fee sought is reasonable for the services rendered.’ Gisbrecht v.
Barnhart, 535 U.S. 789, 807, 122 S. Ct. 1817, 1828, 152 L. Ed. 2d 996 (2002). For
example, courts 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. Id. at 808,
122 S. Ct. at 1828.”).
The award notice states that Woods’s past-due benefits for October 2016
through May 2020 totaled $51,816.00, and that $12,648.65 of those benefits were
being withheld by the Commissioner to pay Woods’s representative. (See Doc. 24-2,
PageID.661-662). 8 Lassiter represents that the Commissioner has approved an
award of $6,000.00 in fees for his services in representing Woods before the SSA.
See (Doc. 24, PageID.653, ¶ 8); 42 U.S.C. § 406(a)(1) (“Except as provided in
paragraph (2)(A), whenever the Commissioner of Social Security, in any claim before
the Commissioner for benefits under this subchapter, makes a determination
favorable to the claimant, the Commissioner shall, if the claimant was represented
by an attorney in connection with such claim, fix (in accordance with the regulations
prescribed pursuant to the preceding sentence) a reasonable fee to compensate such
attorney for the services performed by him in connection with such claim.”). Lassiter
requests that he be allowed $6,648.65 (i.e., $12,648.65 - $6,000.00) in fees for work
performed on behalf of Woods in this Court.9 The Court’s duty now is to determine
whether it is reasonable for Lassiter to receive that amount for the work performed
in this action.
The withheld amount is slightly less than 25% of Woods’s past-due benefits, which
appears due to the fact that the Commissioner excluded benefits awarded for May
2020 from the computation. (See Doc. 24-2, PageID.661). However, Lassiter does not
dispute the propriety of the withheld amount. (See Doc. 24, PageID.652-653, ¶ 7).
8
Abrogating prior Eleventh Circuit precedent, the United States Supreme Court
has recently held that the 25% cap in § 406(b)(1)(A) applies only to fees for court
representation, and not to the aggregate fees awarded under §§ 406(a) and (b).
Culbertson v. Berryhill, 139 S. Ct. 517 (2019). Lassiter’s fee agreement with Woods
nevertheless appears to limit his overall fee to 25% total of Woods’s past-due
benefits.
9
Considering the amount of time Lassiter devoted to this case and the services
performed (see Doc. 24-1), the Court finds that the benefits awarded to Woods are not
so “large in comparison to the amount of time counsel spent on the case” such that “a
downward adjustment is … in order.” Gisbrecht, 535 U.S. at 808. Lassiter appears to
have obtained excellent results for his client through his efforts, and a review of the
docket for this action does not indicate that Lassiter has been responsible for any
significant delay. Having considered the guidance set forth in Gisbrecht, the
undersigned finds that it is reasonable for Lassiter to receive $6,648.65 under §
406(b) in this action.10
III.
Conclusion
In accordance with the foregoing analysis, it is ORDERED that Lassiter’s
motion for allowance of fees as part of the judgment under 42 U.S.C. § 406(b) (Doc.
24) is GRANTED and that Lassiter is allowed as part of the judgment in this action
a reasonable fee under § 406(b) for work performed in the amount of $6,648.65, to be
Under EAJA’s Savings Provision, 28 U.S.C. § 2412 note, Act of Aug. 5, 1985, Pub.
L. No. 99–80, § 3, 99 Stat. 183, 186, “an attorney who receives fees under both the
EAJA and 42 U.S.C. § 406(b) must refund the smaller fee to his client…” Jackson,
601 F.3d at 1274. Lassiter represents that the $3,520.35 in previously paid “EAJA
fees are being temporarily held in the firm’s trust account for distribution to the
Plaintiff…” (Doc. 28 at 6). See Jackson, 601 F.3d at 1274 (“The obligation to make
the refund is imposed on the attorney. There is no language in the Savings Provision
that requires courts to take any action with respect to the refund. In particular,
nothing in the Savings Provision commands courts to order a specific refund
procedure if the claimant's attorney has already taken other steps to effectuate the
refund.”).
10
paid from Woods’s recovered past-due benefits.11
DONE and ORDERED this the 10th day of August 2020.
/s/ Katherine P. Nelson
KATHERINE P. NELSON
UNITED STATES MAGISTRATE JUDGE
Unless a party requests one, no separate judgment regarding attorney’s fees shall
be forthcoming. See Fed. R. Civ. P. 58(a)(3) (judgment need not be set out in a
separate document for an order disposing of a motion for attorney’s fees).
11
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