Kluthe v. Commissioner of Social Security

Filing 30

ORDER GRANTING 28 Counsel's Motion for Attorney Fees Pursuant to 42 U.S.C. § 406(b), signed by Magistrate Judge Jennifer L. Thurston on 8/12/2019. (Hall, S)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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KENNETH JOHN KLUTHE,
Plaintiff,

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v.

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ANDREW M. SAUL1,
Commissioner of Social Security,

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Defendant.

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Case No.: 1:16-cv-00742- JLT
ORDER GRANTING COUNSEL’S MOTION
FOR ATTORNEY FEES PURSUANT TO
42 U.S.C. § 406(b)
(Doc. 28)

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Denise Bourgeois Haley, counsel for Plaintiff Laurie Wells, seeks an award of attorney fees

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pursuant to 42 U.S.C. § 406(b). (Doc. 28) Neither Plaintiff nor the Commissioner of Social Security

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oppose the motion.2 For the following reasons, the motion for attorney fees is GRANTED.

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I.

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Relevant Background
Plaintiff entered into a contingent fee agreement with the Law Offices of Lawrence D. Rohlfing

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on April 14, 2016. The agreement entitled counsel to an award of “25% of the backpay awarded” if

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judicial review of an administrative decision was required, and the adverse decision of an ALJ was

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reversed. (Doc. 28-1 at 1) The agreement also required counsel to “seek compensation under the Equal

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Access to Justice Act,” and the amount awarded would be credited to Plaintiff “for fees otherwise

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This action was originally brought against Carolyn W. Colvin in her capacity as then-Acting Commissioner.
Andrew M. Saul, the newly appointed Commissioner, has been automatically substituted as the defendant in this action.
See Fed. R. Civ. P. 25(d).
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The Commissioner filed a response to the motion, in which he offered “an analysis of fee request” but took “no
position on the reasonableness of the request.” (Doc. 29 at 5)

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payable for court work.” (Id.)
On May 27, 2016, Plaintiff filed a complaint for review of the administrative decision denying

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his application for Social Security benefits. (Doc. 1) The Court determined the ALJ erred in evaluating

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the medical record and rejecting the opinion of Plaintiff’s treating physician. (Doc. 24 at 10-14) In

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addition, the Court found the ALJ erred in rejecting the credibility of Plaintiff’s subjective complaints.

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(Id. at 14-18) Therefore, the Court remanded the matter for further proceedings pursuant to sentence

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four of 42 U.S.C. § 405(g). (Id. at 19) Following the entry of judgment in favor of Plaintiff (Doc. 25),

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the Court awarded $4,200 in attorney fees pursuant to the Equal Access to Justice Act. (Doc. 27 at 1)

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Upon remand, an ALJ issued a “fully favorable decision,” finding Plaintiff was disabled

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beginning on February 13, 2013. (Doc. 28-2 at 1, 8) On April 20, 2019, the Social Security

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Administration concluded Plaintiff was entitled to monthly benefits from Social Security beginning

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August 2013. (Doc. 28-3 at 1) In total, Plaintiff was entitled to $56,209.00 in past-due benefits, out of

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which the Commissioner withheld $14,052.25 for payment of attorney’s fees. (Doc. 28-3 at 4)

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Ms. Haley filed the motion now before the Court on July 19, 2019, seeking fees in the amount

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of $10,000. (Doc. 28) Ms. Haley served Plaintiff with the motion and informed of him of the right to

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file a response to indicate whether he agreed or disagreed with the requested fees. (Id. at 2, 11) Plaintiff

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has not opposed the motion.

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II.

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Attorney Fees under § 406(b)
An attorney may seek an award of fees for representation of a Social Security claimant who is

awarded benefits:

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Whenever a court renders a judgment favorable to a claimant under [42 USC § 401, et
seq] 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. . . .

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42 U.S.C. § 406(b)(1)(A); see also Gisbrecht v. Barnhart, 535 U.S. 789, 794 (2002) (Section 406(b)

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controls fees awarded for representation of Social Security claimants).

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A contingency fee agreement is unenforceable if it provides for fees exceeding the statutory

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amount. Gisbrecht, 535 U.S. at 807 (“Congress has provided one boundary line: Agreements are

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unenforceable to the extent that they provide for fees exceeding 25 percent of the past-due benefits.”).
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III.

Discussion and Analysis
District courts “have been deferential to the terms of contingency fee contracts § 406(b) cases.”

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Hern v. Barnhart, 262 F.Supp.2d 1033, 1037 (N.D. Cal. 2003). However, the Court must review

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contingent-fee arrangements “as an independent check, to assure that they yield reasonable results in

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particular cases.” Gisbrecht, 535 U.S. at 807. In doing so, the Court should consider “the character of

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the representation and the results the representative achieved.” Id. at 808. In addition, the Court should

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consider whether the attorney performed in a substandard manner or engaged in dilatory conduct or

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excessive delays, and whether the fees are “excessively large in relation to the benefits received.”

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Crawford v. Astrue, 586 F.3d 1142, 1149 (9th Cir. 2009) (en banc).
Plaintiff entered into the contingent fee agreement in which she agreed to pay twenty-five

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percent of any awarded past-due benefits. The Law Offices of Lawrence D. Rohlfing accepted the risk

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of loss in the representation and expended a total of 19.4 hours while representing Plaintiff before the

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District Court. (Doc. 28 at 3; Doc. 28-4 at 1-2) Due to counsel’s work, the action was remanded for

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further proceedings before an administrative law judge, and Plaintiff ultimately received an award of

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benefits for disability. For this, Ms. Haley requests a fee of $10,000. (Doc. 28 at 3) Because $4,200

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was paid under the EAJA, the net cost to Plaintiff is $5,800.00. Finally, though served with the motion

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and informed of the right to oppose the fee request (Doc. 28 at 2, 11), Plaintiff did not file oppose the

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request and thereby indicates his implicit belief that the fee request is reasonable.

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Significantly, there is no indication Ms. Haley performed in a substandard manner or engaged in

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severe dilatory conduct to the extent that a reduction in fees is warranted. Plaintiff was able to secure a

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fully favorable decision following the remand for further proceedings, including an award of past-due

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benefits. The fees requested are less than eighteen percent of the past-due benefits of $56,209.00, and

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thus do not exceed twenty-five percent maximum permitted under 42 U.S.C. §406(b).

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IV.

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Conclusion and Order
Based upon the tasks completed and results achieved, the Court finds the fees sought by Ms.

Haley are reasonable. Accordingly, the Court ORDERS:
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Counsel’s motion for attorney fees pursuant to 24 U.S.C. §406(b) in the amount of
$10,000 is GRANTED;
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Lawrence D. Rohlfing; and

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The Commissioner shall pay the amount directly to Counsel, the Law Offices of

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Counsel SHALL refund $4,200 to Plaintiff Kenneth John Kluthe.

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IT IS SO ORDERED.
Dated:

August 12, 2019

/s/ Jennifer L. Thurston
UNITED STATES MAGISTRATE JUDGE

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