Avila v. Commissioner of Social Security

Filing 22

Order GRANTING Plaintiff's Counsel's 20 Motion for Attorney's Fees pursuant to 42 U.S.C. § 406(b), signed by Magistrate Judge Erica P. Grosjean on 5/23/2019. (Rosales, O.)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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1:17-cv-00420-EPG

LORRAINE MARIE AVILA,

ORDER GRANTING PLAINTIFF’S
COUNSEL’S MOTION FOR
ATTORNEY’S FEES PURSUANT TO 42
U.S.C. § 406(b)

Plaintiff,
v.
COMMISSIONER OF SOCIAL SECURITY,

(ECF No. 20)

Defendant.

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On February 8, 2019, counsel for Plaintiff, Cyrus Safa of the Law Offices of Lawrence D.

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Rohlfing, filed a motion for an award of attorney’s fees pursuant to 42 U.S.C. § 406(b). (ECF No.

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20.) Plaintiff and Defendant were served with a copy of the motion. (ECF No. 20 at 9.) Plaintiff

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has not filed an objection or other response to the motion. Defendant has filed a response to the

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motion in which Defendant neither objects nor assents to the 406(b) fees sought by Plaintiff’s

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counsel. (ECF No. 21.)

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For the reasons set forth below, the motion for an award of attorney’s fees is GRANTED

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in the amount of $8,265.75, subject to an offset of $2,700.00 in fees already awarded pursuant to

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the Equal Access to Justice Act (“EAJA”) on October 17, 2017. (See ECF No. 19.)

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I. 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 insurance benefits pursuant to Title II of the Social

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Security Act. (ECF No. 1.) On July 7, 2017, this Court issued an order granting Plaintiff’s appeal

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and remanding the case to the agency for further proceedings. (ECF No. 16.) On July 7, 2017,
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judgment was entered in accordance with the Court’s order. (ECF No. 17.)
On remand, the Commissioner awarded benefits to Plaintiff, including past-due benefits in

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the amount of $57,063.00, and that $14,265.75 of the past-due benefits, representing 25% of the

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past-due benefits award, was being withheld to pay Plaintiff’s representative. (ECF No. 20-2 at 1,

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4.) On October 12, 2017, the parties filed a stipulation for an award of $2,700.00 in attorney fees

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under EAJA (ECF No. 18), and on October 17, 2017, the Court entered an order on the

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stipulation, awarding EAJA attorney fees in the amount of $2,700.00, and costs in the amount of

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$400.00. (ECF No. 19.)

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On February 8, 2019, Plaintiff’s counsel filed a motion for attorney fees in the amount of

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$8,265.75, with an offset of $2,700.00 for EAJA fees already awarded. (ECF No. 22.) Plaintiff’s

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counsel’s § 406(b) motion for attorney fees is currently pending before the Court.

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II. DISCUSSION

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Pursuant to the Social Security Act, attorneys may seek a reasonable fee for cases in
which they have successfully represented social security claimants. Section 406(b) provides:
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).

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“In contrast to fees awarded under fee-shifting provisions such as 42 U.S.C. § 1988, the

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[406(b)] fee is paid by the claimant out of the past-due benefits awarded; the losing party is not

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responsible for payment.” Crawford v. Astrue, 586 F.3d 1142, 1147 (9th Cir. 2009) (en banc)

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(citing Gisbrecht v. Barnhart, 535 U.S. 789, 802 (2002)). Even though the § 406(b) attorney fees

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award is not paid by the government, the Commissioner has standing to challenge the award.

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Craig v. Sec’y Dep’t of Health & Human Servs., 864 F.2d 324, 328 (4th Cir. 1989), abrogated on

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other grounds in Gisbrecht, 535 U.S. at 807. The goal of fee awards under § 406(b) is to provide

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adequate incentive to represent claimants while ensuring that the usually meager disability
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benefits received are not greatly depleted. Cotter v. Bowen, 879 F.2d 359, 365 (8th Cir. 1989),

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abrogated on other grounds by Gisbrecht, 535 U.S. at 807.

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The 25% maximum fee is not an automatic entitlement, and courts are required to ensure

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that the requested fee is reasonable. Gisbrecht, 535 U.S. at 808-09 (section 406(b) does not

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displace contingent-fee agreements within the statutory ceiling; instead, section 406(b) instructs

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courts to review for reasonableness fees yielded by those agreements). “Within the 25 percent

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boundary . . . the attorney for the successful claimant must show that the fee sought is reasonable

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for the services rendered.” Id. at 807; see also Crawford, 586 F.3d at 1148 (holding that § 406(b)

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“does not specify how courts should determine whether a requested fee is reasonable” but

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“provides only that the fee must not exceed 25% of the past-due benefits awarded”).
Generally, “a district court charged with determining a reasonable fee award under

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§ 406(b)(1)(A) must respect ‘the primacy of lawful attorney-client fee arrangements,’ . . .

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‘looking first to the contingent-fee agreement, then testing it for reasonableness.’” Crawford, 586

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F.3d at 1148 (quoting Gisbrecht, 535 U.S. at 793, 808). The United States Supreme Court has

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identified several factors that may be considered in determining whether a fee award under a

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contingent-fee agreement is unreasonable and therefore subject to reduction by the court: (1) the

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character of the representation; (2) the results achieved by the representative; (3) whether the

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attorney engaged in dilatory conduct in order to increase the accrued amount of past-due benefits;

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(4) whether the benefits are large in comparison to the amount of time counsel spent on the case;

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and (5) the attorney’s record of hours worked and counsel’s regular hourly billing charge for non-

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contingent cases. Id. (citing Gisbrecht, 535 U.S. at 807-08).

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Here, the fee agreement between Plaintiff and the Law Offices of Lawrence D. Rohlfing,
LLP, which is signed by Plaintiff and counsel, provides:
If this matter requires judicial review of any adverse decision of the Social
Security Administration, the fee for successful prosecution of this matter is a
separate 25% of the backpay awarded upon reversal of any unfavorable
ALJ decision for work before the court. Attorney shall seek compensation
under the [EAJA] and such amount shall credit to the client for fees otherwise
payable for court work.
(ECF No. 21-1 (emphasis in original).)
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The Court has considered the character of counsel’s representation of Plaintiff and the

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good results achieved by counsel, which includes an award of benefits. Plaintiff’s counsel

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represents that the firm spent 17.3 hours of attorney and paralegal time representing Plaintiff in

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this matter, ultimately gaining a favorable decision in that the case was remanded to the

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Commissioner, who then awarded benefits to Plaintiff. (Doc. 20-3 (time sheet accounting for 14.1

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attorney hours and 3.2 paralegal hours spent representing Plaintiff before the district court).)

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There is no indication that a reduction of the award is warranted due to any substandard

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performance by Plaintiff’s counsel as counsel secured a successful result for Plaintiff. There also

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is no evidence that counsel engaged in any dilatory conduct resulting in delay.

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Plaintiff’s counsel seeks an award of $8,265.75, which results in a blended hourly rate for

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attorney and paralegal time of $477.79. The Ninth Circuit has found similar—and in many cases,

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higher—effective hourly rates reasonable in social security contingency fee arrangements. See,

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e.g., Crawford, 586 F.3d at 1153 (explaining that the majority opinion found reasonable effective

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hourly rates equaling $519, $875, and $902) (J. Clifton, concurring in part and dissenting in part);

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see also Patterson v. Apfel, 99 F. Supp. 2d 1212, 1214 & n.2 (C.D. Cal. 2000) (noting that “a

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survey of several dozen cases in which attorney's fees were awarded in social security cases

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suggests that the 33.75 hours spent by plaintiff's counsel falls within the approved range,” and

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collecting cases).

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Further, the requested attorney fees award of $8,265.75 is 14.5% of past-due benefits

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awarded to Plaintiff, and thus does not exceed 25% of past-due benefits, and is not excessive in

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relation to the past-due benefits awarded. See generally Ortega v. Comm'r of Soc. Sec., No. 1:12–

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cv–01030–AWI–SAB, 2015 WL 5021646, at *3 (E.D. Cal. Aug. 21, 2015) (granting § 406(b)

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attorney fees in the amount of $24,350.00); Thomas v. Colvin, No. 1:11–cv–01291–SKO, 2015

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WL 1529331, at *3 (E.D. Cal. Apr. 3, 2015) (granting § 406(b) attorney fees in the amount of

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$44,603.50); Boyle v. Colvin, No. 1:12–cv–00954–SMS, 2013 WL 6712552, at *2 (E.D. Cal.

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Dec. 19, 2013) (granting § 406(b) attorney fees in the amount of $20,577.57); Jamieson v. Astrue,

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No. 1:09-cv-00490-LJO-DLB, 2011 WL 587096, at *2 (E.D. Cal. Feb. 9, 2011) (recommending

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an award of § 406(b) attorney fees in the amount of $34,500.00), adopted by 2011 WL 841363.
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In making this determination, the Court recognizes the contingent-fee nature of this case

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and counsel’s assumption of risk in agreeing to represent Plaintiff under such terms. “District

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courts generally have been deferential to the terms of contingency fee contracts in § 406(b)

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cases.” Harris v. Barnhart, 262 F. Supp. 2d 1033, 1037 (N.D. Cal. 2003). Attorneys who agree to

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represent claimants pursuant to a contingent fee agreement assume the risk of receiving no

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compensation for their time and effort if the action does not succeed. Id. Here, Plaintiff's

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attorneys accepted substantial risk of loss in representing Plaintiff, whose application had already

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been denied at the administrative level. Plaintiff agreed to the contingent fee, and counsel

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successfully secured a remand and ultimately an award of substantial benefits to Plaintiff.

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An award of attorney fees pursuant to § 406(b) in the amount of $8,265.75 is, therefore,

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appropriate. An award of § 406(b) fees, however, must be offset by any prior award of attorney

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fees granted under the EAJA. See 28 U.S.C. § 2412; Gisbrecht, 535 U.S. at 796. Plaintiff was

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previously awarded $2,700.00 in fees pursuant to the EAJA; as such, the § 406(b) award will be

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offset by $2,700.00.

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III. CONCLUSION AND ORDER

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For the reasons stated above, the Court finds that the attorney fees sought by Plaintiff’s
counsel pursuant to § 406(b) are reasonable. Accordingly, IT IS ORDERED:
1. Plaintiff's counsel’s motion for an award of attorney fees pursuant to 42 U.S.C.
§ 406(b) in the amount of $8,265.75 (ECF No. 20) is GRANTED;

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2. Plaintiff's counsel is ordered to reimburse Plaintiff $2,700.00 of the § 406(b) fees

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awarded as an offset for the EAJA fees previously awarded pursuant to 28 U.S.C. § 2412(d).

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3. The Clerk of the Court is respectfully directed to serve a copy of this Order on Ms.
Lorraine Marie Avila, 1961 Roland Drive, Hanford, CA 93230.

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IT IS SO ORDERED.
Dated:

May 23, 2019

/s/
UNITED STATES MAGISTRATE JUDGE

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