Lopez v. Commissioner of Social Security

Filing 38

FINDINGS and RECOMMENDATIONS Regarding 35 Attorney's Fees signed by Magistrate Judge Gary S. Austin on 1/30/2014. (Martinez, A)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA
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MARGARET LOPEZ,

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Plaintiff,

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Case No. 1:10-cv-1012-AWI-GSA

v.

FINDINGS AND RECOMMENDATIONS
REGARDING ATTORNEY’S FEES

CAROLYN W. COLVIN,1
COMMISSIONER OF SOCIAL SECURITY,

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(Doc. 35 )
Defendant.

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I.

INTRODUCTION

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On November 26, 2013, counsel for Plaintiff, Sengthiene Bosavanh, Esq., filed a motion

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21 for an award of attorney fees on behalf of herself and Ralph Wilborn pursuant to 42 U.S.C. §
22 406(b). (Doc. 35.) Plaintiff Margaret Lopez (“Plaintiff”) and Defendant were each served with
23 the motion. The motion served on Plaintiff provided that any objections must be filed with the
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Court within fourteen days. (Doc. 25, pg. 2). The Commissioner was also advised that any

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opposition to the motion must be filed no later than December 27, 2013. (Doc. 36). In keeping
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Carolyn W. Colvin became the Acting Commissioner of Social Security on February 14, 2013. Pursuant to Rule
25(d) of the Federal Rules of Civil Procedure, Carolyn W. Colvin is substituted for Michael J. Astrue as the
Defendant in this action.

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1 with the role resembling that of a trustee for Plaintiff in this context, on December 16, 2013, the
2 Commissioner filed a response to Ms. Bosavanh’s motion, but did not oppose the motion. (Doc.
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37). See generally Gisbrecht v. Barnhart, 535 U.S. 789, 798 n. 6 (2002). Plaintiff did not file a

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reply. For the reasons set forth below, the Court RECOMMENDS that Ms. Bosavanh's motion
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for attorney fees be GRANTED IN PART.

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BACKGROUND

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Plaintiff brought the underlying action seeking judicial review of a final administrative

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decision denying her claim for disability benefits under the Social Security Act. (Doc. 1.) On

11 August 31, 2011, District Court Judge Oliver Wanger adopted this Court’s Findings and
12 Recommendations granting Plaintiff’s appeal from the administrative decision of the
13 Commissioner of Social Security and remanding the case to the Commissioner of Social Security
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for a calculation of benefits only. (Docs 22 and 23).

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On November, 28, 2011, Plaintiff filed a motion for an award of Equal Access to Justice

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17 Act (“EAJA”) fees, which was opposed by the Commissioner. (Doc. 25, 27, 31). On July 23,
18 2011, District Court Judge Anthony Ishii adopted this Court’s Findings and Recommendations
19 and Plaintiff was awarded EAJA fees in the amount of $7,586.45.2 (Doc. 34.)
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Ms. Bosavanh now seeks an award of attorney fees in the amount of $8,625.75 pursuant
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to section 406(b). Ms. Bosavanh filed evidence in support of the motion indicating that on

23 September 30, 2013, the Commissioner issued a notice that retroactive disability benefits were
24 awarded to Plaintiff totaling $34,053.00. (Doc. 35-2). It is Ms. Bosavanh's Section 406(b) motion
25 for attorney fees that is currently pending before the Court.
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District Court Judge Ishii issued the order regarding EAJA fees after the case was reassigned to him following

28 the retirement of District Court Judge Oliver Wanger.

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III.

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DISCUSSION

Pursuant to the Social Security Act, attorneys may seek a reasonable fee for cases in

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which they have successfully represented social security claimants. Section 406(b) provides the
following in relevant part:

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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 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 ... 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 ....

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11 42 U.S.C. § 406(b)(1)(A) (emphasis added). “In contrast to fees awarded under fee-shifting
12 provisions such as 42 U.S.C. § 1988, the fee is paid by the claimant out of the past-due benefits
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awarded; the losing party is not responsible for payment.” Crawford v. Astrue, 586 F.3d 1142,

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1147 (9th Cir.2009) (en banc) (citing Gisbrecht v. Barnhart, 535 U.S. at 789, 802. The
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Commissioner has standing to challenge the award, despite that the Section 406(b) attorney's fee

17 award is not paid by the government. Craig v. Sec ‘y Dep't of Health & Human Servs., 864 F.2d
18 324, 328 (4th Cir.1989), abrogated on other grounds in Gisbrecht, 535 U.S. at 807. The goal of
19 fee awards under Section 406(b) is to provide adequate incentive to represent claimants while
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ensuring that the usually meager disability benefits received are not greatly depleted. Cotter v.
Bowen, 879 F.2d 359, 365 (8th Cir.1989), abrogated on other grounds in Gisbrecht, 535 U.S. at

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807.
The twenty-five percent (25%) maximum fee is not an automatic entitlement, and courts

25 are required to ensure that the requested fee is reasonable. Gisbrecht, 535 U.S. at 808–09
26 (Section 406(b) does not displace contingent-fee agreements within the statutory ceiling; instead,
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Section 406(b) instructs courts to review for reasonableness fees yielded by those agreements).

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1 “Within the 25 percent boundary ... the attorney for the successful claimant must show that the
2 fee sought is reasonable for the services rendered.” Id. at 807; see also Crawford, 586 F.3d at
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1148 (holding that Section 406(b) “does not specify how courts should determine whether a
requested fee is reasonable” but “provides only that the fee must not exceed 25% of the past-due

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benefits awarded”).
Generally, “a district court charged with determining a reasonable fee award under §

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8 406(b)(1)(A) must respect ‘the primacy of lawful attorney-client fee arrangements,’ ... ‘looking
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first to the contingent-fee agreement, then testing it for reasonableness.’ ” Crawford, 586 F.3d at
1148 (quoting Gisbrecht, 535 U.S. at 793, 808). The United States Supreme Court has identified

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several factors that may be considered in determining whether a fee award under a contingent-fee
agreement is unreasonable and therefore subject to reduction by the court: (1) the character of the

14 representation; (2) the results achieved by the representative; (3) whether the attorney engaged in
15 dilatory conduct in order to increase the accrued amount of past-due benefits; (4) whether the
16 benefits are large in comparison to the amount of time counsel spent on the case; and (5) the
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attorney's record of hours worked and counsel's regular hourly billing charge for non-contingent

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cases. Id. (citing Gisbrecht, 535 U.S. at 807–08).
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Here, the fee agreement between Plaintiff and her counsel provides for a fee consisting of

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21 “25% of the past-due benefits resulting from [Plaintiff's] claim or claims.” (Doc. 35-1.) The
22 Court has considered the character of counsel's representation of Plaintiff and the results
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achieved by counsel. Through contested motion, Plaintiff's counsel was found to have reasonably
expended a total of 42.60 hours litigating Plaintiff's case.3 (See Doc. 33, pg. 10 and Doc. 34, pg.

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2). There is no indication that a reduction of the award is warranted due to any substandard
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The Court notes that in the instant motion, Ms. Bosavanh represents that 67.1 hours of attorney hours were
expended in this case despite the fact that this Court previously found those hours to be excessive and reimbursed
Plaintiff’s counsel only for 42.60 hours. (Doc. 35, pgs. 1 and 7).

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1 performance by counsel in this matter. Both counsel were experienced attorneys who secured a
2 successful result for Plaintiff. There is also no evidence that the attorneys engaged in any dilatory
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conduct resulting in excessive delay.

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Notwithstanding the above, counsel’s request of $8,625.75 exceeds 25% of the

6 $34,053.00 past-due benefits. The amount Plaintiff’s attorneys are entitled to equals $8,513.25
7 ($34,053.00 x .25 = $8,513.25). Therefore, Plaintiff’s request will be reduced accordingly. The
8 $8,513.25 amounts represents 25% of the past-due benefits paid to Plaintiff and are not excessive
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in relation to the past-due award. See generally Taylor v. Astrue, No. 1:06–cv–00957–SMS, 2011
WL 836740, at *2 (E.D.Cal. Mar.4, 2011) (granting petition for an award of attorney's fees

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pursuant to Section 406(b) in the amount of $20,960.00); Jamieson v. Astrue, No. 1:09–cv–
00490–LJO–DLB, 2011 WL 587096, at *2 (E.D.Cal. Feb.9, 2011) (recommending an award of

14 attorney's fees pursuant to Section 406(b) in the amount of $34,500.00); Logan–Laracuente v.
15 Astrue, No. 1:07–cv–00983–SMS, 2010 WL 4689519, at *2 (E.D.Cal. Nov.10, 2010) (granting
16 petition for attorney's fees pursuant to Section 406(b) in the amount of $23,558.62).
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In making this determination, the Court recognizes the contingent-fee nature of this case
and counsel's assumption of risk in agreeing to represent Plaintiff under such terms. See Hearn v.

20 Barnhart, 262 F.Supp.2d 1033, 1037 (N.D.Cal.2003) (“Because attorneys like Mr. Sackett
21 contend with a substantial risk of loss in Title II cases, an effective hourly rate of only $450 in
22 successful cases does not provide a basis for this court to lower the fee to avoid a ‘windfall.’ ”
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(quoting Gisbrecht, 535 U.S. at 807)). Further, counsel has submitted billing statements in

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support of the requested fee, which were the subject of fairly extensive EAJA litigation and were
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thoroughly reviewed by the Court.

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An award of Section 406(b) fees, however, must be offset by any prior award of

2 attorney's fees granted under the EAJA. 28 U.S.C. § 2412; Gisbrecht, 535 U.S. at 796. Plaintiff's
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counsel has already been awarded $7,586.45 in fees pursuant to the EAJA, and thus any Section

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406(b) fees awarded must be offset by $7,586.45 and that amount must be refunded to Plaintiff.
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CONCLUSION AND RECOMMENDATIONS

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For the reasons stated above, the Court concludes that the fees sought by Mr. Bosavanh

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pursuant to Section 406(b) are reasonable. Accordingly, IT IS HEREBY RECOMMENDED

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that:
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1. Plaintiff's counsel's motion for an award of attorney's fees pursuant to Section 406(b)

12 be granted in part and reduced as outlined above. Plaintiff’s counsel request for fees should be
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2. Plaintiff's counsel be ordered to refund to Plaintiff $7,586.45 of the Section 406(b) fees
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awarded as an offset for EAJA fees previously awarded pursuant to 28 U.S.C. § 2412(d);
3. The Clerk of the Court is directed to serve these Findings and Recommendations on

18 Margaret Lopez at 3522 North Maroa Ave., Fresno, California 93704.
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These findings and recommendations are submitted to the district judge assigned to this
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action, pursuant to 28 U.S.C. § 636(b)(1) (B). Within fourteen (14) days of service of this

22 recommendation, any party may file written objections to these findings and recommendations
23 with the Court and serve a copy on all parties. Such a document should be captioned “Objections
24 to Magistrate Judge's Findings and Recommendations.” The district judge will review the
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magistrate judge's findings and recommendations pursuant to 28 U.S.C. § 636(b)(1)(C). The
parties are advised that failure to file objections within the specified time may waive the right to

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appeal the district judge's order. Martinez v. Ylst, 951 F.2d 1153 (9th Cir.1991).

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IT IS SO ORDERED.

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Dated:

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January 30, 2014

/s/ Gary S. Austin
UNITED STATES MAGISTRATE JUDGE

DEAC_Signature-END:

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