Cathey v. Commissioner of Social Security

Filing 31

ORDER granting 25 Motion for Attorney Fees signed by Magistrate Judge Barbara A. McAuliffe on 6/10/2015. (Lundstrom, T)

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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 DONALD CATHEY, 12 Case No. 1:10-cv-1562-BAM Plaintiff, 13 ORDER GRANTING ATTORNEY’S FEES v. 14 THE COMMISSIONER OF SOCIAL SECURITY, 15 (Doc. 25) Defendant. 16 17 18 I. INTRODUCTION 19 Plaintiff’s counsel, Sengthiene Bosavanh, Esq., filed a Motion for Attorney’s Fees 20 1 21 pursuant to 42 U.S.C. § 406(b). (Doc. 22.) Donald Cathey (“Plaintiff”) and the Commissioner 22 of Social Security (“Defendant”) were served with the motion. (Doc. 25-1, pg.1). The motion 23 advised Plaintiff that any objections must be filed with the Court within fourteen days. (Doc. 25, 24 25 pg. 2). In keeping with the role resembling that of a trustee for Plaintiff, the Commissioner filed a response to Ms. Bosavanh’s motion. (Doc. 28). See generally, Gisbrecht v. Barnhart, 535 U.S. 26 27 28 1 The parties have consented to Magistrate Judge jurisdiction. (See, Docs. 11 and 29). 1 1 789, 798 n. 6 (2002). Plaintiff did not file any objections. For the reasons set forth below, the 2 Motion for Attorney’s Fees is GRANTED. 3 4 II. 5 Plaintiff brought the underlying action seeking judicial review of a final administrative 6 7 BACKGROUND decision denying his claim for disability benefits under the Social Security Act. (Doc. 1.) On June 5, 2012, the court entered a judgment against the defendant and remanded the case for 8 9 10 further proceedings. (Doc. 21). Subsequently, Plaintiff’s counsel was awarded attorney’s fees under the Equal Access to Justice Act (“EAJA”) in the amount of $6,742.53. (Doc. 24.) Ms. 11 Bosavanh now seeks an award of attorney fees in the amount of $8,657.00 pursuant to 42 U.S.C. 12 § 406(b). In support of the motion, Ms. Bosavanh filed evidence indicating that Plaintiff was 13 awarded $34,826.00 in retroactive disability benefits. (Doc. 25-2, pg. 1). She is seeking 25% of 14 the retroactive benefits awarded for attorney’s fees. 15 16 17 III. DISCUSSION Pursuant to the Social Security Act, attorneys may seek a reasonable fee for cases in 18 which they have successfully represented social security claimants. Section 406(b) provides the 19 following in relevant part: 20 21 22 23 24 25 26 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 .... 42 U.S.C. § 406(b)(1)(A) (emphasis added). “In contrast to fees awarded under fee-shifting 27 provisions such as 42 U.S.C. § 1988, the fee is paid by the claimant out of the past-due benefits 28 awarded; the losing party is not responsible for payment.” Crawford v. Astrue, 586 F.3d 1142, 2 1 1147 (9th Cir.2009) (en banc) (citing Gisbrecht, 535 U.S. at 789, 802). However, the 2 Commissioner has standing to challenge the award, despite the fact that the Section 406(b) 3 attorney's fee award is not paid by the government. Craig v. Sec ‘y Dep't of Health & Human 4 Servs., 864 F.2d 324, 328 (4th Cir.1989), abrogated on other grounds in Gisbrecht, 535 U.S. at 5 6 807. The goal of fee awards under Section 406(b) is to provide adequate incentive to represent 7 claimants while ensuring that the usually meager disability benefits received are not greatly 8 depleted. Cotter v. Bowen, 879 F.2d 359, 365 (8th Cir.1989), abrogated on other grounds in 9 Gisbrecht, 535 U.S. at 807. 10 The twenty-five percent (25%) maximum fee is not an automatic entitlement, and courts 11 12 13 are required to ensure that the requested fee is reasonable. Gisbrecht, 535 U.S. at 808–09 (Section 406(b) does not displace contingent-fee agreements within the statutory ceiling; instead, 14 Section 406(b) instructs courts to review for reasonableness fees yielded by those agreements). 15 “Within the 25 percent boundary ... the attorney for the successful claimant must show that the 16 fee sought is reasonable for the services rendered.” Id. at 807; see also Crawford, 586 F.3d at 17 18 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 19 20 21 benefits awarded”). Generally, “a district court charged with determining a reasonable fee award under § 22 406(b)(1)(A) must respect ‘the primacy of lawful attorney-client fee arrangements,’ ... ‘looking 23 first to the contingent-fee agreement, then testing it for reasonableness.’ ” Crawford, 586 F.3d at 24 1148 (quoting Gisbrecht, 535 U.S. at 793, 808). The United States Supreme Court has identified 25 26 several factors that may be considered in determining whether a fee award under a contingent-fee 27 agreement is unreasonable and therefore subject to reduction by the court: (1) the character of the 28 representation; (2) the results achieved by the representative; (3) whether the attorney engaged in 3 1 dilatory conduct in order to increase the accrued amount of past-due benefits; (4) whether the 2 benefits are large in comparison to the amount of time counsel spent on the case; and (5) the 3 attorney's record of hours worked and counsel's regular hourly billing charge for non-contingent 4 cases. Id. (citing Gisbrecht, 535 U.S. at 807–08). 5 6 Here, Plaintiff and counsel have entered into an agreement that provides for attorney’s 7 fees in the amount of 25% of the past-due benefits. (Doc. 25-3, pg.1). The Court has considered 8 counsel's representation of Plaintiff and the results achieved by counsel. There is no indication 9 10 that a reduction of the award is warranted due to any substandard performance by counsel in this matter. Counsel is an experienced attorney who secured a successful result for Plaintiff. There 11 12 13 is also no evidence that Ms. Bosavanh engaged in any dilatory conduct resulting in excessive delay. Thus, the $8,657.00 represents 25% of the past-due benefits paid to Plaintiff and is not 14 excessive in relation to the past-due award. See generally Deardon v. the Comm’n of Soc. Sec., 15 No. 1:12-cv-120-BAM, 2014 WL 6612036, at *2 (E.D. Cal., Nov. 20, 2014) (granting attorney’s 16 fees pursuant to Section 406(b) in the amount of $16,474.00); Taylor v. Astrue, No. 1:06–cv– 17 00957–SMS, 2011 WL 836740, at *2 (E.D. Cal., Mar.4, 2011) (granting petition for an award of 18 attorney's fees pursuant to Section 406(b) in the amount of $20,960.00); Jamieson v. Astrue, No. 19 20 1:09–cv–00490–LJO–DLB, 2011 WL 587096, at *2 (E.D. Cal., Feb.9, 2011) (recommending an 21 award of attorney's fees pursuant to Section 406(b) in the amount of $34,500.00). In making this 22 determination, the Court recognizes the contingent-fee nature of this case and counsel's 23 assumption of risk in agreeing to represent Plaintiff under such terms. See Hearn v. Barnhart, 24 262 F.Supp.2d 1033, 1037 (N.D.Cal.2003) (“Because attorneys like Mr. Sackett contend with a 25 26 substantial risk of loss in Title II cases, an effective hourly rate of only $450 in successful cases does not provide a basis for this court to lower the fee to avoid a windfall.”). 27 28 4 1 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. Here, 3 Plaintiff's counsel has already been awarded EAJA fees in the amount of $6,742.53.00. 4 Therefore, any Section 406(b) fees awarded must be off-set by $6,742.53.00, and refunded to 5 6 7 8 Plaintiff. IV. CONCLUSION AND ORDER For the reasons stated above, the fees sought by Ms. Bosavanh pursuant to Section 406(b) 9 are reasonable. Accordingly, IT IS HEREBY ORDERED that: 10 11 1. The Motion for Attorney’s Fees pursuant to Section 406(b) in the amount of $8,657.00 12 is GRANTED; 13 2. Plaintiff's counsel is ordered to refund $6,742.53 of the Section 406(b) fees awarded to 14 Plaintiff as an offset for EAJA fees previously awarded pursuant to 28 U.S.C. § 2412(d); and 15 16 3. The Clerk of the Court is directed to serve this order on Plaintiff, Donald Cathey at 440 17 E. Lincoln Ave., Fresno, California 93706. 18 19 20 21 IT IS SO ORDERED. Dated: /s/ Barbara June 10, 2015 A. McAuliffe _ UNITED STATES MAGISTRATE JUDGE 22 23 24 25 26 27 28 5

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