Moore v. Astrue

Filing 35

MEMORANDUM OPINION AND ORDER granting in part and denying in part 31 Motion for Attorney Fees. Signed by Magistrate Judge David A. Sanders on 4/26/16. (Attachments: # 1 Exhibit) (def)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF MISSISSIPPI
ABERDEEN DIVISION
ANGELIA MARIE MOORE
V.

PLAINTIFF
CIVIL ACTION NO. 1:12CV269-DAS

MICHAEL J. ASTRUE

DEFENDANT

MEMORANDUM OPINION AND ORDER
This matter is before the court on the motion of plaintiff’s counsel for attorney’s fees and
expenses. The court has considered the plaintiff's motion, the defendant’s response, the
argument presented at the hearing on the motion, as well as evidence submitted to the court
without objection after the hearing. The court finds as follows:
1. LEGAL FEES UNDER THE EQUAL ACCESS TO JUSTICE ACT
Plaintiff's counsel has moved for an award of legal fees and expenses pursuant to the
Equal Access to Justice Act, 28 U.S.C. § 2412. The defendant has opposed the motion as
untimely. While the parties acknowledge the motion for attorney’s fees and expenses under this
statute must be filed within thirty days of the final judgment in this action, the parties disagree
about what triggers the time limit in this action. This dispute arises because, in spite of the court
entering its judgment on March 11, 2015 in the plaintiff’s favor reversing the ALJ’s decision and
remanding this action, plaintiff’s counsel waited more than a year – until after the conclusion of
the post-remand administrative action and an award of benefits to his client – to file this EAJA
application.
There are two paths under which a court may remand a case back to the Social Security
Administration for further action under 42 U.S.C. § 405(g), which governs judicial review of that
agency’s decisions. The two types of remands are very different, with different consequences

for an EAJA fee petition. Melkonyan v. Sullivan, 501 U.S. 89, 102-103 (1991). A sentence four
remand is an adjudication on the merits of the appeal and terminates the action in the courts,
while in a sentence six remand, the court retains jurisdiction during the pendency of post-remand
administrative proceedings. Determining which sentence controls the remand in the instant
action determines whether the instant motion is timely.
The defendant argued that this court’s remand was pursuant to sentence four and that the
plaintiff had ninety days after entry of the March 2014 judgment to file for EAJA fees and
expenses. Plaintiff’s counsel argued that the court’s remand was under sentence six because the
judgment of this court on appeal did not result in an award of benefits. According to the
plaintiff’s attorney, the time for filing a petition for attorneys fees commenced only upon the
award of benefits.1
The court looks first to the statute to determine the nature of the remand in this case.
Sentence four of § 405(g) provides: "The court shall have power to enter, upon the pleadings and
transcript of the record, a judgment affirming, modifying or reversing the decision of the
Commissioner of Social Security, with or without remanding the cause for rehearing." This is by
far the more commonly occurring type of Social Security remand. In the sentence four remands,
the court makes a substantive decision on "the correctness of the administrative decision."
Faucher v. Sec. of Health and Human Services, 17 F.3d 171,174 (6th Cir. 1994). The judgment
closes the case and divests the court of jurisdiction. Shalala v. Schaefer, 509 U.S. 292, 297-98
(1993). By entry of a judgment the court closes the case, and the plaintiff is the prevailing
1

Pursuant to the holding in Melkonyan,501 U.S. 89 (1991), if this is a sentence six remand,
either the agency should have filed a supplemental record, since there was a less than completely
favorable award or the plaintiff should have applied to this court for the entry of a final judgment. Only
on the entry of a final judgment would the time for an EAJA application begin to run.

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party. If other conditions are met, the plaintiff is then entitled to an award of EAJA fees,
whether or not there is ever an ultimate finding of entitlement to benefits. Id. at 299.
The second type of remand arises under sentence six of 42 U.S.C. § 405(g) which
provides:
The court may, on motion of the Commissioner of Social Security made for good
cause shown before the Commissioner files the Commissioner's answer, remand
the case to the Commissioner of Social Security for further action by the
Commissioner of Social Security, and it may at any time order additional
evidence to be taken before the Commissioner of Social Security, but only upon a
showing that there is new evidence which is material and that there is good cause
for the failure to incorporate such evidence into the record in a prior proceeding
and the Commissioner of Social Security shall, after the case is remanded, and
after hearing such additional evidence if ordered, modify or affirm the
Commissioner's findings of fact or the Commissioner's decision, or both, and shall
file with the court any such additional and modified findings of fact and decision,
and, in any case in which the Commissioner has not made a decision fully
favorable to the individual, a transcript of the additional record and testimony
upon which the Commissioner's action in modifying or affirming was based.

With sentence six remands, the court retains jurisdiction during the remand and the remand order
is thus not a final order or judgment but an unappealable, interlocutory order. These remands do
not involve findings of error by the agency.
Sentence six remands are limited to two circumstances. First the court may remand a
case on a pre-answer motion by the Social Security Administration. These motions typically
address some problem with producing a complete administrative record for appellate review.
On rare occasions entire case records are lost. More frequently tapes of administrative hearings
are lost, or portions may be too unintelligible for transcription. On occasion other parts of the
record are missing. Thus the court must allow the agency to correct flaws in the record with
further administrative proceedings. As a matter of common sense, this type of remand is not a

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victory for a plaintiff. They have not prevailed on the merits against the defendant, but rather the
appeal cannot proceed because there is no adequate record.
The other type of sentence six remand occurs only when two conditions concur. First,
the court must be shown new and material evidence on appeal that is not included in the
administrative record. The new evidence is only material if the court finds that the agency, given
the opportunity to review the new evidence, might well alter its decision. Melkonyan, 501 U.S.
at 98. The statute requires a showing of good cause for failing to make this new, material
evidence a part of the administrative record before the court can issue this sentence six remand.
In this circumstance the court allows the agency to review the new evidence and to reconsider its
findings in light of the new evidence, taking up the appeal later if necessary. Again, this type or
remand does not find agency error, nor does it make the appealing claimant a prevailing party on
the merits of the appeal. Rather this type of remand allows for the completion of administrative
proceedings prior to any appellate review.
After completion of the post-remand proceedings under sentence six, if there is a less
than fully favorable decision, the Social Security Administration is required to file a
supplemental administrative record with the federal court, which can then proceed with the
appeal. If there is a favorable ruling, the plaintiff may apply to the court for entry of a judgment.
With the entry of the judgment in federal court, the plaintiff is then recognized as the party that
prevailed on the sentence six remand and the time for filing an EAJA petition commences.
Melkonyan, 501 U.S. at 103 (1991).
In this case the court finds that it clearly remanded this action under sentence four of 42
U.S.C. § 405(g). The court found the ALJ erred when he refused to allow any additional time

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for the submission of missing medical evidence. The court also found the ALJ erred when he
interfered with counsel’s attempt to develop his client’s testimony. The ALJ, in effect, refused
to allow the plaintiff to develop the record, a ruling closely analogous to finding error when an
ALJ fails to properly develop the record, which is a sentence four remand. Ingram v.
Commissioner of Social Security Adm., 496 F.3d 1253 (11th Cir. 2011).
The court appreciates the potential problems for plaintiff’s counsel if there is ambiguity
about whether a remand is under sentence four or sentence six, but can find no ambiguity in this
case. There was no pre-answer motion to remand under the sentence six. The plaintiff, while
complaining about not being allowed to supplement the record after the hearing, did not present
any new evidence to this court during the appellate review. Consequently, the court remanded
this action under sentence four. Courts are required to enter a judgment to conclude sentence
four remands. Melkonyan, 501 U.S. 101-102. This court entered just such a judgment in the
plaintiff’s favor. As to the argument that the plaintiff cannot be considered a prevailing party
unless and until there is an award of benefits, the U.S. Supreme Court rejected precisely that
argument in Schaefer, 509 U.S. at 300.
The court finds that the application for legal fees under EAJA was not filed within the
time limit set out in the statute. The application had to be filed “within thirty days of final
judgment in the action....” 24 U.S.C. § 2412 (d)(1(b). As the Social Security Administration has
urged, plaintiff’s counsel had a total of ninety days from the entry of the judgment in which to
file his application for EAJA fees and this motion was not filed for more than a year after the
entry of judgment. Having failed to file within the prescribed time limits the court must deny the
motion for EAJA fees and expenses. Schaefer, 509 U.S. at 303.

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2. LEGAL FEES UNDER 42 U.S.C. § 406(b)
Plaintiff’s counsel amended his motion at the hearing to claim he is seeking legal fees
under 42 U.S.C. § 406(b). There are two potential sources of attorney’s fees set forth within the
Social Security Act. An attorney can receive compensation under 42 U.S.C § 406(a) for services
rendered on behalf of a claimant before the Social Security Administration. The agency
determines a reasonable fee subject to the statutory cap of twenty-five percent of a claimant’s
back due benefits. An attorney can also receive attorneys fees under the Social Security Act for
representation of a claimant before the federal courts. This fee is also capped at twenty-five
percent of the back benefits due a claimant under 42 U.S.C. § 406 (b). While there is some
difference of opinion between the circuits, in the Fifth Circuit Court of Appeals, the claims for
attorney’s fees for administrative and court work are subject to an aggregate cap of twenty-five
percent of the total back benefits award. Dawson v. Finch, 425 F.2d 1192, 1195 (5th Cir. 1970).

Furthermore, to prevent double recoveries by attorneys, any EAJA attorneys fees
awarded must be offset against any § 406(b) fee award. A claimant’s attorney may either reduce
a
§ 406(b) claim by the amount of EAJA fees, or may receive both fees, but must then refund the
smaller of the two fees to the plaintiff. Jackson v. Comm’r of Soc. Sec., 601 F.3d 1268, 2173
(11th Cir. 2010) (“Regardless of whether the attorney writes a refund check to his client or
deducts the amount of the EAJA award from his § 406(b) fee request, the purpose of the Savings
Provision is fulfilled—the attorney does not get a double recovery.”).

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After the hearing, at the request of the court, plaintiff’s counsel submitted both a notice
of award to his client and a letter to counsel dated December 27, 2015. These documents are
attached to this order as Exhibit 1.2 According to the Administration’s letter to counsel, it retains
$1,064.00, representing the balance of the twenty-five percent it withheld from the claimant’s
past due benefits. The letter states it has already paid plaintiff’s counsel $ 10,000.00 for legal
services before the agency, less the normal user fee. Plaintiff’s counsel now seeks payment of
the $ 1,064.00 balance for his work before this court under § 406(b).
Counsel has submitted an itemization of time and expenses to the court and requests the
balance of the withheld funds as his fee. The defendant concedes this small sum would be a
reasonable fee for counsel’s representation of the plaintiff before the federal courts. The court
concurs that this small fee is not only a reasonable fee request, but requests significantly less
than a reasonable hourly rate for work performed despite the problems that are manifest with the
itemizations provided.3 Nevertheless, because the amount sought is so small and because this

2

While there may be some explanation not provided to the court, the court has compared the
Notice of Award with the Letter to Counsel, and notes a discrepancy. According to the Notice of Award,
a total of $ 9,709.00 was withheld from the claimant’s past due benefits, representing 25% of the total, yet
the letter to counsel notes that he has already been paid $ 10,000.00 dollars in fees. The court trusts that
the parties will correct any error that may have occurred in the payment of fees for administrative level
legal services.
3

A review of the itemization makes it appear as if it is not based on contemporaneous time
records and is therefore subject to the vagaries of memory. The itemizations of time are listed only by
month and year, rather than by specific dates or even ranges of dates. Additionally, all but two time
entries are in hour and half-hour increments, with the two exceptions being claims for fifteen minutes
each. Time records should reflect the actual time spent on specific tasks and time should be billed in
increments in tenths of an hour. Hunt v. Social Security Administration, 3:12cv25 (N.D. Miss. April 1,
2013).
The time and expense records also appear inaccurate. Counsel claims five hours for travel and
oral argument, plus mileage to and from Oxford, Mississippi. The argument was actually held in
Aberdeen, Mississippi. Finally as a caution to all counsel about the perils of failing to keep
contemporaneous time records, the court notes a claim for four hours for the brief filed in this action. The
court has no doubt that counsel was not able to perform the needed record review, research, drafting and

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district does not yet have a definitive set of rules for attorneys who apply for fees under § 406(b),
and because the Commissioner concedes the amount sought here is reasonable, the court will
grant the motion for fees filed pursuant to § 406(b).4
IT IS, THEREFORE, ORDERED that the motion for attorney’s fees and expenses is
hereby granted in part and denied in part. The motion for attorney’s fees filed pursuant to the
EAJA is denied, and the motion for attorney’s fees filed pursuant to 42 U.S.C. § 406(b) is
granted. Plaintiff’s counsel is entitled to $1,064.00.
SO ORDERED this the 26th day of April, 2016.
/s/ David A. Sanders
UNITED STATES MAGISTRATE JUDGE

revision within such a short time. The court suspects that accurate time records would likely have yielded
a higher total than the 20.5 hours claimed for court work.
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The court notes it has serious hesitation about granting any claim for attorney’s fees
under §406(b) when counsel fails to timely pursue and obtain an award of EAJA fees. Had a
timely application for EAJA fees been made, the court would have undoubtedly awarded
attorney’s fees to the counsel for the federal court representation – fees substantially in excess of
the small amount now available. The offset provision of the EAJA may mean that the total fees
collected by an attorney will not, in many cases, differ whether collected under EAJA or
§ 406(b). But the client has a very real interest in having EAJA fees pursued first. The award of
EAJA fees can preserve thousands of dollars of benefits for the attorney’s client.
While the court has found no Fifth Circuit cases addressing whether counsel must apply
for EAJA fees as a prerequisite to receiving § 406(b) fees, some courts have found just such a
duty and have reduced or denied § 406(b) fees where counsel has failed, without justification, to
seek payment of attorneys fees first under EAJA. Knagge v. Sullivan, 735 F. Supp. 411, 414
(M.D. Fla. 1990) (Counsel has “both statutory and ethical obligations to investigate the propriety
of an application for a fee award pursuant to the Equal Access to Justice Act, 28 U.S.C.
§ 2412(d), before receiving approval of a fee award to be deducted from the plaintiff’s past-due
benefits); Taylor v. Heckler, 608 F. Supp. 1255 (D.N.J. 1985) . Because counsel in the present
action believed the court remanded the matter pursuant to sentence six and because the amount
sought is so small, the court will not deny the motion on this ground.
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