Hamilton v. Commissioner of Social Security

Filing 25

DECISION AND ORDER granting 23 Motion for Attorney Fees. Signed by Hon. Elizabeth A. Wolford on 08/29/2024. (CDH)

UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NEW YORK
___________________________________
MICHELLE H.,
Plaintiff,

DECISION AND ORDER

v.
1:22-CV-00933 EAW
COMMISSIONER OF SOCIAL SECURITY,
Defendant.
____________________________________
INTRODUCTION
Plaintiff Michelle H. (“Plaintiff”) seeks attorneys’ fees of $22,745.68 pursuant to
42 U.S.C. § 406(b).

(Dkt. 23).

The Commissioner of Social Security (“the

Commissioner”) neither supports nor opposes Plaintiff’s fee request. (Dkt. 24). For the
reasons that follow, the Court grants Plaintiff’s motion.
BACKGROUND
Plaintiff filed two actions against the Commissioner, seeking review of the
Commissioner’s final decisions. On July 28, 2020, Plaintiff filed her first action, seeking
review of the Commissioner’s final decision denying her application for disability
insurance benefits (“DIB”). (Dkt. 1 of 1:20-CV-00977). Plaintiff moved for judgment on
the pleadings, and on November 23, 2021, the Court approved the parties’ stipulation for
remand, reversing the Commissioner’s final decision and remanding the matter for further
administrative proceedings. (Dkt. 20, Dkt. 22 of 1:20-CV-00977).

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By Stipulated Order filed on January 12, 2022, the Court approved payment of
$6,800.00 in attorneys’ fees to Plaintiff’s counsel pursuant to the Equal Access to Justice
Act, 28 U.S.C. § 2412(d) (“EAJA”), for services performed in connection with the first
action. (Dkt. 26 of 1:20-CV-00977).
On remand, the Administrative Law Judge (“ALJ”) issued a partially favorable
decision on August 1, 2022, granting Plaintiff benefits for two separate time periods, from
June 15, 2015-October 12, 2018, and as of June 6, 2022. (Dkt. 23-1 at 3; see also Dkt. 11 at 1, 6).
On December 1, 2022, Plaintiff filed the instant action, seeking review of the
Commissioner’s final decision denying her application for DIB between October 12, 2018,
and June 5, 2022. (Dkt. 1). On March 8, 2023, the Court approved the parties’ stipulation
for remand, reversing the Commissioner’s final decision and remanding the matter for
further administrative proceedings. (Dkt. 7).
By Stipulated Order filed on June 13, 2023, the Court approved payment of
$2,200.00 in attorneys’ fees to Plaintiff’s counsel pursuant to EAJA, for services performed
in connection with this action. (Dkt. 11).
On September 12, 2023, Plaintiff’s counsel was contacted by the Commissioner and
informed that Plaintiff would receive a fully favorable decision on the record for the
contested period between October 13, 2018, and June 5, 2022, without need for an
additional hearing. (Dkt. 12-1 at ¶ 22).1

1

The ALJ’s determination was issued on October 30, 2023. (Dkt. 23-3).
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On September 21, 2023, Plaintiff moved for an extension of time to file a motion
for attorneys’ fees under § 406(b) because the Notice of Award that the Commissioner
issued in connection with Plaintiff’s claim did not allow Plaintiff’s counsel to determine
the full amount of the past-due benefits awarded to Plaintiff. (Dkt. 12-1 at ¶¶ 2-3, 16-25).
The extension was granted, and following multiple status reports filed by Plaintiff advising
the Court that she had not received the final Notice of Award, the Court ordered the
Commissioner to submit an update as to the status of the final Notice of Award. (Dkt. 15;
Dkt. 16; Dkt. 17; Dkt. 18, Dkt. 19). On February 18, 2024, the Commissioner issued the
final Notice of Award, awarding $90,982.70 in past-due benefits from June 2016 to
October 2023. (Dkt. 23-4 at 1, 3). The Notice of Award stated that the Commissioner
withheld $22,745.68 from Plaintiff’s past-due benefits to pay for Plaintiff’s attorneys’ fees.
(Id. at 3).
On March 3, 2024, Plaintiff moved pursuant to 42 U.S.C. § 406(b) seeking a total
of $22,745.68 in attorneys’ fees. (Dkt. 23). In her motion, Plaintiff’s counsel indicates
that she was awarded the sum of $9,000.00 under the EAJA for both the first action
($6,800.00) and the instant action ($2,200.00), which she will refund to Plaintiff once the
instant fee application is resolved. (Dkt. 23-1 at 5). The Commissioner filed a response
on March 5, 2024. (Dkt. 24).
DISCUSSION
I.

Timeliness of the Motion
Generally, a fee application under § 406(b) must be filed within 14 days after the

entry of judgment. Fed. R. Civ. P. 54(d)(2)(B)(1). Rule 54(a)(2)(B) as applied to § 406(b)
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motions for attorneys’ fees, requires that a party moving for attorneys’ fees file the motion
within 14 days of notice of a benefits award. Sinkler v. Berryhill, 932 F.3d 83, 88 (2d Cir.
2019). Additionally, a presumption applies that a notice is received “three days after
mailing.” Id. at 89 n.5; see also Fed. R. Civ. P. 6(d). Moreover, it has been determined
that the 14-day limitation period is subject to equitable tolling “until the claimant receives
notice of the amount of any benefits award. That is because the benefits award amount is
necessary to identify the maximum attorney’s fee that may be awarded under § 406(b).”
Sinkler, 932 F.3d at 85.
Here, the Commissioner issued the final Notice of Award on February 18, 2024.
(23-4 at 1). Thus, it was not until then that counsel was able to ascertain Plaintiff’s total
past-due benefits and the maximum attorneys’ fees that she could seek under § 406(b).
Plaintiff’s counsel filed her application 14 days later on March 3, 2024. (Dkt. 24).
Accordingly, Plaintiff’s application is timely.
II.

The Reasonableness of the Requested Fee
Section 406(b) provides, in relevant 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. . . .

42 U.S.C. § 406(b)(1)(A). In other words, § 406(b) allows a successful claimant’s attorney
to seek court approval of his or her fees, not to exceed 25 percent of the total past-due
benefits. Section 406(b) “calls for court review of [contingent-fee] arrangements as an
independent check, to assure that they yield reasonable results in particular cases.”
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Gisbrecht v. Barnhart, 535 U.S. 789, 807 (2002). This review is subject to “one boundary
line: Agreements are unenforceable to the extent that they provide for fees exceeding 25
percent of the past-due benefits.” Id. “Within the 25 percent boundary, . . . the attorney
for the successful claimant must show that the fee sought is reasonable for the services
rendered.” Id.
Accordingly, a fee is not automatically recoverable simply because it is equal to or
less than 25 percent of the client’s total past-due benefits. “To the contrary, because section
406(b) requires an affirmative judicial finding that the fee allowed is ‘reasonable,’ the
attorney bears the burden of persuasion that the statutory requirement has been satisfied.”
Id. at 807 n.17. As such, the Commissioner’s failure to support or oppose the motion is
not dispositive. Mix v. Comm’r of Soc. Sec., No. 6:14-CV-06219 (MAT), 2017 WL
2222247, at *2 (W.D.N.Y. May 22, 2017).

Several factors are relevant to the

reasonableness analysis, including the following: (1) “whether the contingency percentage
is within the 25% cap[;]” (2) “whether there has been fraud or overreaching in making the
agreement[;]” and (3) “whether the requested amount is so large as to be a windfall to the
attorney.” Wells v. Sullivan, 907 F.2d 367, 372 (2d Cir. 1990). Also relevant are the
following: (1) “the character of the representation and the results the representative
achieved[;]” (2) “the amount of time counsel spent on the case[;]” (3) whether “the attorney
is responsible for delay[;]” and (4) “the lawyer’s normal hourly billing charge for
noncontingent-fee cases.” Gisbrecht, 535 U.S. at 808.
When determining whether a requested fee constitutes a windfall, courts are
required to consider: (1) “the ability and expertise of the lawyers and whether they were
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particularly efficient[,]” (2) “the nature and length of the professional relationship with the
claimant—including any representation at the agency level[,]” (3) “the satisfaction of the
disabled claimant[,]” and (4) “how uncertain it was that the case would result in an award
of benefits and the effort it took to achieve that result.” Fields v. Kijakazi, 24 F.4th 845,
854-55 (2d Cir. 2022).
Here, Plaintiff’s counsel seeks $22,745.68 in attorneys’ fees that is represented to
be 25 percent of the past-due benefits. (Dkt. 23-1 at 10). Utilizing the factors set forth
above, the Court finds that there is no evidence of fraud or overreaching in the making of
the contingency agreement between counsel and Plaintiff. Counsel provided effective
representation in both actions, resulting in Plaintiff successfully receiving the benefits
sought. There is no reason to believe that Plaintiff is dissatisfied with the outcome of such
representation. The success of Plaintiff’s claim was uncertain as demonstrated by multiple
denials of her application and multiple hearings before Plaintiff won a fully favorable
decision for the entire time period for which she sought benefits. Accordingly, the hours
expended by counsel were reasonable in light of the issues presented and the extent of
representation.
The requested fee would result in a de facto hourly rate of $489.15 ($22,745.68
divided by 46.5 hours). (See Dkt. 23-5).2 The Court finds that neither the de facto hourly
rate, nor the overall requested attorneys’ fees amount, constitutes a windfall. Even though
the hourly rate requested is greater than Plaintiff’s counsel’s normal hourly rate of $210.00-

2

Plaintiff’s counsel states that she devoted 43.5 hours to both actions (Dkt. 23-1 at
13), but her time itemization reflects that she spent 46.5 hours on the actions (Dkt. 23-5).
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$225.00 per hour (id.), counsel’s successful representation achieved multiple remands that
ultimately resulted in Plaintiff’s receipt of a fully favorable decision and past-due benefits.
The effective hourly rate of $489.15 falls within (or below) the range of rates under
§ 406(b) approved by courts. See, e.g., Fields, 24 F.4th at 856 (an effective hourly rate of
$1,556.98 was not a “windfall”); Anthony F. v. Comm’r of Soc. Sec., No. 1:21-cv-0934EAW, 2024 WL 2889097, at *2 (W.D.N.Y. June 10, 2024) (approving de facto hourly rate
of $985.22); Yamile B. S. v. Comm’r of Soc. Sec. Admin., No. 3:19CV00155(SALM), 2022
WL 1115099, at *3 (D. Conn. Apr. 14, 2022) (approved an hourly rate of $495.86, which
was significantly lower than § 406(b) fee awards that have been approved in the Second
Circuit).
Having considered the required factors, the Court finds that counsel’s effective
hourly rate of $489.15 is reasonable and in line with awards generally approved in this
District for similar work performed. The Court is also “mindful that ‘payment for an
attorney in a social security case is inevitability uncertain.’” Buckley v. Berryhill, 15-CV0341-A, 2018 WL 3368434, at *2 (W.D.N.Y. July 10, 2018) (quoting Wells, 907 F.2d at
371).

Accordingly, “the Second Circuit has recognized that contingency risks are

necessary factors in determining reasonable fees under § 406(b).” Id. (quotation marks
omitted).
The Court also notes that counsel must return the previously paid EAJA fee of
$9,000.00 to Plaintiff. (Dkt. 23-1 at 5). See Gisbrecht, 535 U.S. at 796 (“Fee awards may
be made under both [EAJA and § 406(b)], but the claimant’s attorney must refund to the
claimant the amount of the smaller fee . . . .”).
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CONCLUSION
For the foregoing reasons, Plaintiff’s motion for attorneys’ fees under § 406(b) (Dkt.
21) is granted, and the Court hereby orders as follows: (1) Plaintiff’s counsel shall be paid
attorneys’ fees of $22,745.68 out of funds withheld from Plaintiff’s past-due benefits; and
(2) Plaintiff’s counsel must refund the previously received EAJA fee of $9,000.00 to
Plaintiff.
SO ORDERED.

__________________________________
______
______________________
_
________
ELIZABETH
E
LIZ
ZABETH A. WOLFORD
WO
OLFORD
Chief
C
hief Judgee
United States District Court
Dated:

August 29, 2024
Rochester, New York

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