Tacey v. Social Security Administration, Commissioner

Filing 25

MEMORANDUM AND ORDER sustaining in part 23 Motion for Attorney Fees. Under 42 U.S.C. § 406(b), plaintiff's attorney, Sharon J. Meyers, is entitled to fees in the amount of $13,616.93. The Commissioner shall pay those fees from the amount which she is holding from plaintiff's past due benefits. The Commissioner shall pay to plaintiff any remainder of withheld benefits. Signed by District Judge Kathryn H. Vratil on 8/8/2018. (hl)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS
DAVID J. TACEY,

)
)
Plaintiff,
)
)
v.
)
)
NANCY A. BERRYHILL,
)
Acting Commissioner of Social Security,
)
)
Defendant.
)
________________________________________________)

CIVIL ACTION
No. 15-9094-KHV

MEMORANDUM AND ORDER
David J. Tacey appealed the final decision of the Commissioner of Social Security to deny
disability benefits under Title II of the Social Security Act (“SSA”), 42 U.S.C. §§ 401 et seq. On
March 10, 2017, pursuant to the fourth sentence of 24 U.S.C. § 405(g), the Court entered judgment
reversing the Commissioner’s decision and remanding the case for further proceedings. Judgment
In A Civil Case (Doc. #17). On September 22, 2017, pursuant to the Equal Access to Justice Act
(“EAJA”), 28 U.S.C. § 2412(d), the Court awarded plaintiff attorney’s fees in the amount of
$5,354.79. Memorandum And Order (Doc. #22). This matter comes before the Court on plaintiff’s
Motion For Attorney Fees Pursuant To Section 206(b) Of The Social Security Act, 42 USC § 406(b)
(Doc. #23) filed June 11, 2018.
Background Information
As noted, the Court previously entered judgment reversing and remanding the
Commissioner’s decision and awarded attorney’s fees under the EAJA in the amount of $5,354.79.
Memorandum And Order (Doc. #22).
On remand, the Social Security Administration decided the case partially in favor of plaintiff.
See Motion For Attorney Fees (Doc. #23) at 1 and Exhibit B thereto. Specifically, the Social

Security Administration found that plaintiff had been disabled since May 16, 2013 and awarded
past-due benefits in the amount of $99,167.00. See id. From past-due benefits, i.e. $99,167.00, the
Social Security Administration withheld 25 per cent, i.e. $24,791.75.1 See Motion For Attorney
Fees (Doc. #23), Exhibit B.

From funds withheld, i.e. $24,791.75, the Social Security

Administration authorized payment of $6,000.00 to plaintiff’s counsel for representation before the
Commissioner,2 leaving a balance of $18,791.75 in withheld funds.3 See Motion For Attorney Fees
(Doc. #23) at 2 and Exhibit C thereto.
Legal Standards
Attorneys handling social security cases in court may seek fees under both the EAJA and the
SSA. See McGraw v. Barnhart, 450 F.3d 493, 497 (10th Cir. 2006). The statutes provide two
different types of fee awards which the court determines separately. See id. (citing Frazier v. Apfel,
240 F.3d 1284, 1286 (10th Cir. 2001)). Under the EAJA, unless it finds that the government’s
position was “substantially justified” or that special circumstances make an award unjust, the Court
may award fees based on a statutory maximum hourly rate of $125.00. 28 U.S.C. § 2412(d). Fees
awarded under the EAJA penalize the Commissioner for assuming an unjustified legal position and

1

The record is unclear regarding the exact amount of past due benefits awarded to
plaintiff. The SSA withheld $24,791.75, which is 25 per cent of $99,167.00 ($99,167 multiplied by
.25 equals $24,791.75). Counsel asserts that total past due benefits amounted to $99,884.00, see
Motion For Attorney Fees (Doc. #23) at 1, but the Court cannot find that amount listed on Exhibit
B. Counsel asserts that the SSA withheld $24,971.75, see Motion For Attorney Fees (Doc. #23) at
1, but that amount appears to contain a typographical error. See Exhibit B at 3 ($24,791.75
withheld).
2

Section 406(a) authorizes the Commissioner to approve attorney’s fees for
representation in proceedings before the Commissioner. See 42 U.S.C. § 406(a).
3

The total fund withheld ($24,791.75) minus $6,000.00 to plaintiff’s counsel for
representation before Commissioner equals $18,791.75,
-2-

are paid from agency funds. See McGraw, 450 F.3d at 497 (citing Orner v. Shalala, 30 F.3d 1307,
1309 (10th Cir. 1994)); 28 U.S.C. § 2412(d)(1)(A) (EAJA fee awarded to prevailing party). As
such, the government may offset fees awarded under the EAJA to satisfy a claimant’s pre-existing
debt to the government. See Astrue v. Ratliff, 560 U.S. 586, 589 (2010).
Under the SSA, the Court awards fees out of past-due benefits to satisfy a client’s obligation
to counsel. See 42 U.S.C. 406(b)(1)(A);4 McGraw, 450 F.3d at 497. In awarding fees under the
SSA, the Court exercises discretion. Gordon v. Astrue, 361 F. App’x 933, 935 (10th Cir. 2010).
The Court determines such fees based on reasonableness, with a statutory maximum of 25 per cent
of past due benefits. See id. The Court may determine a reasonable fee based on a lodestar
calculation5 or a contingency fee agreement between the attorney and client. See Gisbrecht v.
Barnhart, 535 U.S. 789, 799-800 (2002).6 SSA fees are paid directly to counsel. See McGraw, 450
4

Section 406(b) states, in part, as follows:

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,
notwithstanding the provisions of section 405(i) of this title, but subject to
subsection (d) of this section, 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. In case
of any such judgment, no other fee may be payable or certified for payment for such
representation except as provided in this paragraph.
42 U.S.C. § 406(b)(1)(A).
5

The Court calculates the lodestar amount by multiplying the hours which counsel
reasonably spent on the litigation by a reasonable hourly rate. See Robinson v. City of Edmond, 160
F.3d 1275, 1281 (10th Cir. 1998).
6

In Gisbrecht, the Supreme Court found that Section 406(b) does not exclude
contingent fee contracts that produce fees within the statutory ceiling. 535 U.S. at 800. The Court
(continued...)
-3-

F.3d at 497; 42 U.S.C. § 406(b)(1) (SSA fee paid out of past due benefits). If counsel receives fees
under both the EAJA and the SSA, counsel must refund the smaller amount to plaintiff. See
McGraw, 450 F.3d at 497-98 (citing Gisbrecht, 535 U.S. at 796; Weakley v. Bowen, 803 F.2d 575,
580 (10th Cir. 1986)).
Analysis
Under the SSA, 42 U.S.C. § 406(b)(1)(A), counsel asks the Court to authorize attorney’s fees
in the full amount of remaining withheld funds, i.e. $18,791.75. See Motion For Attorney Fees
(Doc. #23) at 6.7 Section 406(b) limits attorney fee awards to 25 per cent of the total past due
benefits to which claimant is entitled. 42 U.S.C. § 406(b)(1)(A). In addition, the fee must be
reasonable. Id. In Gisbrecht, the Supreme Court found that although Section 406(b) does not
displace contingency fee agreements between plaintiffs and their counsel, the statute “calls for court
review of such arrangements to assure that they yield reasonable results in particular cases.” 535
U.S. at 807. When evaluating reasonableness of a contingency fee, the Court considers whether (1)
the character of the representation and the results it achieved were substandard; (2) the attorney is
responsible for delay that causes disability benefits to accrue during the pendency of the case in
court; and (3) the benefits are large in comparison to the amount of time counsel spent on the case.
Gordon v. Astrue, 361 F. Appx. 933, 934 (10th Cir. 2010) (quoting Gisbrecht, 535 U.S. at 808).
Here, the Court finds that the amount of past due benefits is large in comparison to the

6

(...continued)
noted that the statute requires courts to review such agreements as an “independent check” to ensure
that they yield reasonable results in particular cases. Id. at 807.
7

The Court has adjusted the amount requested to account for counsel’s typographical
error regarding the amount of funds withheld, i.e. $24,791.75, not $24,971.75.
-4-

amount of time counsel spent on the case. Counsel recorded 35.05 hours of work on the case.
See Motion For Attorney Fees (Doc. #23), Exhibit D at 4-6. To award the total amount requested,
i.e. $18,791.75, would result in an effective hourly rate of $536.14.8 In other social security cases,
the court has approved reasonable attorney’s fees in the range of $258.00 to $418.00 per hour. See
Boyer v. Berryhill, No. 15-1054-SAC, 2018 WL 2971499, at *1 (D. Kan. June 12, 2018) (citing
cases with reasonable hourly fees ranging from $258 to $418); Duff v. Colvin, 13-2466-DDC, 2016
WL 3917221, at *2 (D. Kan. July 20, 2016) (hourly fee of $358.50 reasonable). Counsel mistakenly
asserts that because counsel will return to plaintiff the EAJA fee, the effective hourly rate would be
$388.50. See Motion For Attorney Fees (Doc. #23) at 6. The fact that counsel must return the
EAJA fee, however, does not change the fact that counsel would receive a total of $18,791,75 in
attorney’s fees, i.e. $536.14 per hour. On this record, the Court finds that hourly fee of $388.50 is
reasonable. Calculated by the total number of hours spent, i.e. 35.05 hours, the Court awards a total
of $13,616.93 in attorney’s fees.9
IT IS THEREFORE ORDERED that plaintiff’s Motion For Attorney Fees Pursuant To
Section 206(b) Of The Social Security Act, 42 USC § 406(b) (Doc. #23) filed June 11, 2018 is
SUSTAINED in part. Under 42 U.S.C. § 406(b), plaintiff’s attorney, Sharon J. Meyers, is entitled
to fees in the amount of $13,616.93. The Commissioner shall pay those fees from the amount which
she is holding from plaintiff’s past due benefits. The Commissioner shall pay to plaintiff any
remainder of withheld benefits.

8

9

$18,791.75 divided by 35.05 equals $536.14.
$388.50 per hour multiplied by 35.05 hours equals an attorney’s fee of $13,616.93.
-5-

IT IS FURTHER ORDERED that counsel shall return to plaintiff the amount of fees
received under the EAJA, i.e. $5,354.79.
Dated this 8th day of August, 2018 at Kansas City, Kansas.
s/ Kathryn H. Vratil
KATHRYN H. VRATIL
United States District Judge

-6-