Stolze v. Colvin

Filing 29

ORDER that Plaintiff's Motion for Attorneys' Fees (Doc. 26 ) is GRANTED. IT IS FURTHER ORDERED that Plaintiff's counsel must refund the EAJA fee award to Plaintiff as the smaller of the two fee awards. See the attached order for additional information. Signed by Senior Judge James A. Teilborg on 6/3/2020. (RMW)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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James Stolze,

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No. CV-16-01898-PHX-JAT
Plaintiff,

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v.

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Commissioner
Administration,

ORDER

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of

Social

Security

Defendant.

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Pending before the Court is Plaintiff James Stolze’s (“Plaintiff”)1 Motion for

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Attorneys’ Fees. (Doc. 26). The Commissioner has responded. (Doc. 28). The Court now

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rules on the motion.

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When Plaintiff first filed for disability insurance benefits, the Social Security

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Administration’s (“SSA”) Administrative Law Judge (“ALJ”) rendered only a partially

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favorable decision on Plaintiff’s claim. (Doc. 26 at 4). On appeal to this Court, Plaintiff

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and the Commissioner stipulated to a remand under sentence four of 42 U.S.C. § 405(g).

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(Id.). After the case returned to the SSA, the ALJ issued a fully favorable decision. (Id.).

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The SSA has set aside 25 percent of the past-due benefits awarded, $11,462.25, for

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a potential attorneys’ fee award. (Id.). The parties previously stipulated to a $2,933.01

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award of attorneys’ fees under the Equal Access to Justice Act (“EAJA”). (Doc. 24). The

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SSA has also approved a $7,390 fee for counsels’ work at the administrative level. (Doc.

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26 at 13 n.2). Plaintiff’s counsel now seeks $4,072.25 under 42 U.S.C. § 406(b). (Id. at 2).

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Plaintiff is the widower of Cheryl R. Stolze. Because James substituted in as a plaintiff
for Cheryl, the Court will use “Plaintiff” to refer to each of them.

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A court entering judgment in favor of a social security claimant represented by

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counsel “may determine and allow as part of its judgment a reasonable fee for such

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representation, not in excess of 25 percent of the total of the past-due benefits to which the

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claimant is entitled by reason of such judgment.” 42 U.S.C. § 406(b)(1)(A) (emphasis

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added). Although “[t]he statute does not specify how courts should determine whether a

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requested fee is reasonable,” Crawford v. Astrue, 586 F.3d 1142, 1148 (9th Cir. 2009), the

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Supreme Court has made clear that the first step is to respect “the primacy of lawful

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attorney-client fee agreements,” Gisbrecht v. Barnhart, 535 U.S. 789, 793 (2002). A court

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may take a downward departure from a requested fee award “if the attorney provided

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substandard representation or delayed the case, or if the requested fee would result in a

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windfall.” Crawford, 586 F.3d at 1151. A court can also “consider the lodestar calculation,

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but only as an aid in assessing the reasonableness of the fee.” Id. (citing Gisbrecht, 535

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U.S. at 808). “Because the SSA has no direct interest” in how the award is apportioned

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between client and counsel, district courts must independently “assure that the

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reasonableness of the fee is established.” Id. at 1149.

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The $4,072.25 fee is reasonable under Gisbrecht. First, the fee agreement in this

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case provides that Plaintiff’s counsels’ fee shall equal 25 percent of the total amount of

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past-due benefits awarded—“the ‘most common fee arrangement between attorneys and

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Social Security claimants.’” Crawford, 586 F.3d at 1147–48 (quoting Gisbrecht, 535 U.S.

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at 800). Second, nothing in the record indicates that Plaintiff’s counsel exhibited

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substandard representation. Third, the requested fees will not result in a windfall. Dividing

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the requested fees by the 15.3 hours that counsel worked on the case before this Court nets

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an hourly rate of $266.16, which is well within the range of reasonability in Social Security

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cases. Kellogg v. Astrue, No. CV 09-00982-PHX-JAT, 2013 WL 5236638, at *2 (D. Ariz.

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Sept. 17, 2013) (collecting cases). Furthermore, when offset by the EAJA award, Plaintiff

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will ultimately pay only $1,139.24 in § 406(b) fees. Finally, although the Commissioner

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expressed some concern regarding the 40-month delay between the notice of award and the

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instant motion, that concern “abated” once Plaintiff’s counsel informed the Commissioner

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that the time it took to finalize attorneys’ fees for representing Plaintiff before the SSA, see

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42 U.S.C. § 406(a), accounts for this delay. (Doc. 28 at 3). The Court does not find this

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delay warrants reducing the requested fee any further.

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Therefore,

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IT IS ORDERED that Plaintiff’s Motion for Attorneys’ Fees (Doc. 26) is

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GRANTED.
IT IS FURTHER ORDERED that Plaintiff’s counsel must refund the EAJA fee
award to Plaintiff as the smaller of the two fee awards. Gisbrecht, 535 U.S. at 796.
Dated this 3rd day of June, 2020.

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