Twardowski v. Commissioner of Social Security
Filing
25
ORDER GRANTING in part and DENYING in part 21 Plaintiff's Motion for Attorney Fees; Plaintiff's counsel is awarded $ 6,200 in fees to be paid from the funds withheld from Plaintiff's retroactive benefits award, with the remaining withheld funds paid to Plaintiff. If Plaintiff's attorney has received any portion of the EAJA fees award, Plaintiff's attorney is directed to remit such fees to Plaintiff. Signed by Hon. Leslie G. Foschio on 10/13/2020. (TAH)
Case 1:18-cv-00019-LGF Document 25 Filed 10/13/20 Page 1 of 7
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NEW YORK
______________________________________
MATTHEW JOHN TWARDOWSKI,
Plaintiff,
v.
ANDREW M. SAUL, 1 Commissioner of
Social Security,
DECISION
and
ORDER
18-CV-19F
(consent)
Defendant.
______________________________________
APPEARANCES:
LAW OFFICES OF KENNETH R. HILLER, PLLC
Attorneys for Plaintiff
KENNETH R. HILLER, and
JUSTIN DAVID JONES, of Counsel
6000 North Bailey Avenue
Suite 1A
Amherst, New York 14226
JAMES P. KENNEDY, JR.
UNITED STATES ATTORNEY
Attorney for Defendant
Federal Centre
138 Delaware Avenue
Buffalo, New York 14202
and
ANDREEA LAURA LECHLEITNER,
Special Assistant United States Attorneys, of Counsel
Social Security Administration
Office of General Counsel
26 Federal Plaza
Room 3904
New York, New York 10278
1
Andrew M. Saul became Commissioner of the Social Security Administration on June 17, 2019, and,
pursuant to Fed.R.Civ.P. 25(d), is substituted as Defendant in this case. No further action is required to
continue this suit by reason of sentence one of 42 U.S.C. § 405(g).
Case 1:18-cv-00019-LGF Document 25 Filed 10/13/20 Page 2 of 7
JURISDICTION
On June 19, 2018, the parties to this action consented pursuant to 28 U.S.C. §
636(c) to proceed before the undersigned. (Dkt. 13). The matter is presently before the
court on Plaintiff’s counsel’s motion for approval of attorney fees under 42 U.S.C. §
406(b), filed August 5, 2020 (Dkt. 21) (“Plaintiff’s motion”).
BACKGROUND
Plaintiff commenced this action on January 4, 2018, pursuant to Title XVI of the
Social Security Act (“the Act”), 42 U.S.C. §§ 405(g) and 1383(c)(3), seeking judicial
review of the Commissioner of Social Security’s final decision denying Plaintiff’s
application filed with the Social Security Administration (“SSA”), on December 30, 2013,
for Social Security Disability Insurance under Title II of the Act (“SSDI” or “disability
benefits”). On June 18, 2018, Plaintiff moved for judgment on the pleadings (Dkt. 12),
(Plaintiff’s motion), but Plaintiff’s motion was not addressed because on August 8, 2018,
the parties filed a joint stipulation to remand the matter to the Commissioner (Dkt. 14)
(“Stipulation”). By Text Order entered August 13, 2018 (Dkt. 15), the Stipulation was
approved with Judgment entered August 14, 2018 (Dkt. 16) remanding the matter to the
Commissioner. On September 13, 2018, in connection with the remand, Plaintiff
applied for under the Equal Access to Justice Act, 28 U.S.C. § 2412 (“EAJA”),
$ 1,255.07 in fees (“EAJA fees”) (Dkt. 17), which amount the parties agreed to by
stipulation filed September 28, 2019 (Dkt. 19), was approved by Text Order entered
September 28, 2018, (Dkt. 20), and received by Plaintiff’s attorney on November 2,
2
Case 1:18-cv-00019-LGF Document 25 Filed 10/13/20 Page 3 of 7
2018. (Dkt. 21-2 ¶ 15). On July 21, 2020, the SSA issued a Notice of Award granting
Plaintiff disability benefits including $ 76,040 in retroactive benefits, of which
25% or $ 19,010.00 was withheld to pay Plaintiff’s attorney fees. On August 5, 2020,
Plaintiff filed the instant motion (Dkt. 21) (“Plaintiff’s motion”) pursuant to 42 U.S.C.
§ 406(b), seeking $ 9,315.07 in attorney fees, and indicating the EAJA fees had yet to
be received. In response (Dkt. 23), the Commissioner argues an award of $ 9,315.07
would result in an unreasonable hourly rate but does not otherwise oppose the motion.
In reply (Dkt. 24), Plaintiff maintains the fee must be considered net of the EAJA award
to be refunded to Plaintiff, with the resulting hourly rate reasonable.
DISCUSSION
As relevant to the instant motion, the Act 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.
42 U.S.C. § 406(b)(1)(A) (“§ 406”).
Here, in retaining counsel in connection with her disability benefits application, Plaintiff
executed a contingent Fee Agreement 2 providing counsel with permission to apply for
fees up to 25% of any retroactive benefits awarded under § 406 if Plaintiff’s disability
benefits application required litigation in federal court.
Even if the requested attorney fee does not exceed the statutory 25% cap, “the
attorney for the successful claimant must show that the fee sought is reasonable for the
2
A copy of the Fee Agreement is filed as Dkt. 21-5.
3
Case 1:18-cv-00019-LGF Document 25 Filed 10/13/20 Page 4 of 7
services rendered.” Gisbrecht v. Barnhart, 535 U.S. 789, 807 (2002). Where, as here,
there exists an attorney-client contingent fee agreement, Ҥ 406 does not displace
contingent-fee agreements as the primary means by which fees are set for successfully
representing Social Security benefits claimants in court. Rather, § 406(b) calls for court
review of any such arrangements as an independent check to assure that they yield
reasonable results in particular cases.” Id. Contingent fee agreements are also entitled
to some deference, Wells v. Sullivan, 907 F.2d 367, 371 (2d Cir. 1990), in “the interest
in assuring that attorneys continue to represent clients such as the plaintiff.” Gisbrecht,
535 U.S. at 805. Nevertheless, contingent fee agreements “are unenforceable to the
extent that they provide for fees exceeding 25 percent of the past-due benefits.” Id. As
such, “[w]ithin the 25 percent boundary . . . the attorney for the successful claimant must
show that the fee sought is reasonable for the services rendered.” Id.
The Second Circuit Court of Appeals has identified three factors to be considered
in determining whether to approve the full amount of attorney fees requested under a
contingent fee agreement, including (1) whether the requested fee is within the 25%
statutory cap; (2) whether there was any fraud or overreaching in making the contingent
fee agreement; and (3) whether the requested fee is so large as to be a “windfall” to the
attorney. Wells, 907 F.2d at 372. The court is also required to assess whether the
requested fee is inconsistent with the character of the legal representation and the
results achieved by legal counsel, as well as whether counsel effected any
unreasonable delay in the proceedings to increase the retroactive benefits and,
consequently, the attorney’s own fee. Joslyn v. Barnhart, 389 F.Supp.2d 454, 456
(W.D.N.Y. 2005) (citing Gisbrecht, 535 U.S. at 808). Here, the Commissioner’s
4
Case 1:18-cv-00019-LGF Document 25 Filed 10/13/20 Page 5 of 7
challenge to the attorney fee request is limited to the “de facto” hourly rate obtained by
dividing the requested fee by the total hours counsel expended on the matter in this
court, which the Commissioner maintains represents a windfall to counsel and, as such,
is unreasonable. Dkt. 23 at 3-5.
In particular, Plaintiff’s counsel requests as attorney fees $ 9,315.07, which is
only 12.25% the $ 76,040 retroactive disability benefits granted Plaintiff in the Notice of
Award which thus is less than half of the 25% of the retroactive disability benefits
permitted under § 406(b)’s statutory cap, i.e., $ 19,010. 3 Plaintiff’s counsel asserts he
expended a total of 6.2 hours representing Plaintiff in this matter, including, inter alia,
reviewing the decision of the Administrative Law Judge (“ALJ”) denying Plaintiff benefits
at the administrative level, reviewing the administrative record, preparing and filing the
complaint and motion to proceed in forma pauperis, preparing and filing certificate of
service, exchanging e-mails with opposing counsel regarding the remand stipulation,
and preparing and filing the EAJA motion. Dkt. 21-2 at 2-3. 4 Dividing the requested fee
of $ 9,315.07 by 6.2 hours results in an hourly rate of $ 1,502.43. Given the amount
and type of work required in this action, this rate would result in a windfall to counsel.
Preliminarily, there is no merit to Plaintiff’s counsel’s assertion the hourly rate
should be calculated net of the $ 1,255.07 EAJA fees already awarded to and received
by Plaintiff’s counsel such that Plaintiff’s counsel should be considered as seeking only
3
Plaintiff does not explain how the requested fee amount of $ 9,315.07 was determined. Further, the
higher hourly rate in this case is largely attributed to the fact that Plaintiff initially applied for disability
benefits on December 30, 2013, yet was not awarded any benefits until July 21, 2020, such that the 25%
withheld for an attorney fee award is calculated based on more than six and one half years of retroactive
benefits Plaintiff eventually received.
4 The court notes the Plaintiff’s counsel’s time itemization provided in connection with the instant motion
for attorney fees, Dkt. 21-2 at 3, does not correspond with the events per the docket; rather, the correct
time itemization is included in an earlier declaration of Mr. Hiller filed September 13, 2018, in connection
with the request for EAJA fees. See Dkt. 17-2.
5
Case 1:18-cv-00019-LGF Document 25 Filed 10/13/20 Page 6 of 7
$ 8,060 ($ 9,315.07 – $ 1,255.07), Plaintiff’s Memorandum at 7, which Plaintiff’s counsel
further maintains yields an hourly rate of $ 1,300 ($ 8,060 ÷ 6.2). In short, Plaintiff’s
counsel continues to seek attorney fees for 6.2 hours of work, and that he will be
required to refund to Plaintiff the $ 1,255.07 EAJA fee amount already awarded and
received, does not negate that he did receive that amount such that whatever is
approved in connection with the instant motion will not be decreased by refunding the
EAJA amount previously received.
It cannot be denied that counsel’s efforts in this matter were clearly successful as
they resulted in an award of benefits to Plaintiff upon remand. Nevertheless, according
to Plaintiff, 3.1 hours, or half the time asserted expended on the file, was in review of
the administrative record, .4 hours were spent preparing the complaint and IFP motion,
and the remaining 2.7 hours were for telephone conference discussing possible appeal
with client (.4 hours on December 21, 2017), exchanging e-mails with opposing counsel
(.5 hours during April 2018), preparing the EAJA motion (1 hour on September 13,
2018), with the remaining .8 hours spent reviewing court notices and orders. 5 Dkt. 17-2
at 1-2. 6 Although the 12.25% award is less than half of the 25% contingent fee
agreement which is entitled to some deference, Wells, 907 F.2d at 371, in this case the
resulting hourly rate of $1,502.43 Plaintiff requests remains much higher than § 406
attorney fee awards approved in other cases in this court. See, e.g., McDonald v.
5
Despite moving on June 18, 2018, for judgment on the pleadings (Dkt. 12), Plaintiff’s counsel did not
include in his itemization of time any hours for preparation of a memorandum of law in support of such
motion (Dkt. 12-1).
6 Notably, the 25% statutory cap is lower than the one-third contingent fee arrangement typical for
personal injury actions. Furthermore, the higher hourly rate in this case is largely attributed to the fact
that Plaintiff initially applied for disability benefits in March 2014, yet was not awarded any benefits until
October 2019, such that the attorney fee award is calculated based on more than five years of retroactive
benefits Plaintiff eventually received.
6
Case 1:18-cv-00019-LGF Document 25 Filed 10/13/20 Page 7 of 7
Comm’r of Soc. Sec., 2019 WL 1375084, at * 2-3 (W.D.N.Y. Nov. 7, 2019) (approving
attorney fee award of $ 30,602.75 for 29.1 hours of work resulting in hourly rate of
$ 1,051.64); Joslyn v. Barnhart, 389 F.Supp.2d 454, 455-56 (W.D.N.Y. 2005)
(approving attorney fee award of $ 38,116.50 for 42.75 hours of work resulting in hourly
rate of $ 891.61). In these circumstances, the court finds the hourly rate should be
capped at $ 1,000.
CONCLUSION
Based on the foregoing, Plaintiff’s motion for attorney fees under § 406(b) (Dkt.
21) is GRANTED in part and DENIED in part; Plaintiff is awarded $ 6,200 in fees to be
paid from the funds withheld from Plaintiff’s retroactive benefits award, with the
remaining withheld funds paid to Plaintiff. If Plaintiff’s attorney has received any portion
of the EAJA fees award, Plaintiff’s attorney is directed to remit such fees to Plaintiff.
SO ORDERED.
/s/ Leslie G. Foschio
______________________________________
LESLIE G. FOSCHIO
UNITED STATES MAGISTRATE JUDGE
DATED:
October 13th, 2020
Buffalo, New York
7
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