Smith v. Commissioner of Social Security
Filing
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DECISION AND ORDER granting 27 Motion for Attorney Fees. Attorney Smith's motion [ECF No. 27] is granted and Attorney Smith is awarded attorneys fees in the amount of $18,023.50. Upon receipt of this award, Attorney Smith is directed to refund to Plaintiff the $5,561.28 in fees that Attorney Smith was previously awarded under the Equal Access to Justice Act. The Clerk is directed to close this case.Signed by Hon. Charles J. Siragusa on 3/13/20. (KAP)-CLERK TO FOLLOW UP-
UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF NEW YORK
_______________________________________
RAMONA AUDREY SMITH,
-vs-
Plaintiff,
DECISION AND ORDER
COMMISSIONER OF SOCIAL SECURITY,
6:17-CV-6641 (CJS)
Defendant.
________________________________________
INTRODUCTION
Now before the Court is a motion for attorney fees pursuant to 42 U.S.C. §
406(b) by Plaintiff’s attorney, Brandi Smith, Esq., of the Law Offices of Kenneth
Hiller PLLC (“Attorney Smith”). Mot. for Att’y Fees, Dec. 19, 2019, ECF No. 27.
Attorney Smith represented Plaintiff Ramona Audrey Smith (“Plaintiff”) in this
Court’s review of a denial of benefits by the Commissioner of Social Security
(“Commissioner”) that resulted in a reversal of the Commissioner’s decision and a
remand for further proceedings. Dec. and Order, June 19, 2019, ECF No. 22. For
the reasons set forth below, Attorney Smith’s motion for attorney fees (ECF No. 27)
is granted, and she is directed to refund to Plaintiff the $5,561.28 that she was
previously awarded under the Equal Access to Justice Act.
BACKGROUND
Plaintiff filed her application for disability benefits under Title II of the Social
Security Act on September 9, 2014, alleging an onset date of April 13, 2014. Mot. for
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Att’y Fees Ex. 3 (ALJ’s 1 Decision), 5, Dec. 19, 2019, ECF No. 27-3.
After her claim
was denied, Plaintiff received a hearing before an ALJ, at which she was not
represented by Attorney Smith or the Kenneth Hiller law firm. 2 Id. at 2. The ALJ
rendered an unfavorable decision to Plaintiff, and the Commissioner’s Appeals
Council denied Plaintiff’s request for review. Compl. Ex. A (ALJ’s decision), Sept.
14, 2017, ECF No. 1-1.
On August 8, 2019, Plaintiff executed a fee agreement for Attorney Smith’s
representation of Plaintiff for this Court’s review of the Commissioner’s final decision
under 42 U.S.C. § 405(g). Mot. for Att’y Fees, Ex. 5 (Fee Agreement), Dec. 19, 2019,
ECF 27-5. The provisions of the fee agreement most relevant to the present motion
read as follows:
Attorney and Client understand that for a fee to be payable, the Social
Security Administration (SSA) and/or court must approve any fee my
representative charges or collects for me for services my representative
provides in proceedings before SSA or a federal court . . . .
If I do receive Social Security benefits, the attorney fee will be 1/4 (25
percent) of the past due benefits resulting from my claim or $6,000,
whichever is lower . . . [But if] an appeal is taken of the decision of an
Administrative Law Judge to the Appeals Council or to a federal court,
the $6,000.00 limit shall not apply . . . .
If my claim goes to federal district court, I consent to have my attorney
apply for fees in such a manner as to maximize the fee paid to him, even
though it may eliminate or decrease a fee refund under the Equal Access
to Justice Act (EAJA) to which I might have been otherwise entitled ….
I acknowledge that a federal court may award my attorney a reasonable
Administrative Law Judge
Plaintiff was represented at her hearing before the ALJ by Sean Sullivan, a non-attorney, and
attorney Jared Cook. Compl. Ex. A (ALJ’s decision) at 5.
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fee under the Equal Access to Justice Act (EAJA), in which event such
award shall be payable to my attorney and retained by my attorney to
the extent permitted by law, and I shall not be entitled to any such
award and assign said award to my attorney; provided, however, that I
may be entitled to a credit for such fee in the event my attorney is
awarded an additional fee for federal court services under 42 U.S.C.A. §
406(b) . . . .
Id.
Attorney Smith filed a complaint against the Commissioner on Plaintiff’s
behalf in this Court on September 14, 2017, and a motion for judgment on the
pleadings on August 16, 2018. Mot. J. on Pleadings, Aug. 8, 2018, ECF No. 12. In
her 13-page memorandum of law, Attorney Smith provided an extensive factual
background, and argued persuasively that the ALJ relied upon his own lay
interpretation of medical evidence to support his assessment of Plaintiff’s residual
functional capacity. Mem. of Law, 9, Aug. 16, 2018, ECF No. 12-1. Attorney Smith
also drafted and filed a cogent reply brief to respond to the Commissioner’s opposition.
Reply, Dec. 4, 2018, ECF No. 18. Subsequently, this Court entered a Decision and
Order finding that the Commissioner’s decision was not supported by substantial
evidence, and remanding the case for further proceedings.
June 19, 2019, ECF No. 22.
Dec. and Order, 5–6,
Soon thereafter, Attorney Smith filed a motion for
attorney’s fees under the Equal Access to Justice Act, and in a stipulated order was
awarded $5,561.28. Order, Oct. 15, 2019, ECF No. 26.
Plaintiff received a fully favorable decision upon remand, and the
Commissioner mailed Plaintiff a Notice of Award on December 8, 2019,
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communicating the Commissioner’s determination that Plaintiff was entitled to
$73,184.00 in past due benefits. Mot. for Att’y Fees Ex. 4 (Notice of Award), Dec. 19,
2019, ECF No. 27-4. The Notice of Award also informed Plaintiff that $18,023.50
was being withheld to pay Plaintiff’s representative, if applicable. Id. at 3.
Following receipt of the Notice of Award, Attorney Smith timely filed the
present motion with this Court under 42 U.S.C. § 406(b), requesting attorney fees of
$18,023.50. Mot. for Att’y Fees, ECF No. 27. Attorney Smith acknowledges that if
the Court awards her fees in this action, she must refund to Plaintiff the $5,561.28
in fees that she received under the Equal Access to Justice Act.
Id.
The
Commissioner was properly noticed on Attorney Smith’s motion, and has responded
that he “takes no position on this request, but rather he defers to the Court’s sound
discretion as to the reasonableness of the requested fee award.” Resp., 2, Jan. 6,
2020, ECF No. 29.
DISCUSSION
42 U.S.C. § 406(b)(1)(a) provides that in claims against the Commissioner,
“whenever a court renders a judgment favorable to a claimant . . . 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.” The fee awarded
cannot be “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 it is paid “out of, and not in
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addition to, the amount of [the claimant’s] past-due benefits.” 3 Id. An attorney
receiving fees under this provision is not entitled to payment of any other fee. Id.
In this case, Plaintiff and Attorney Smith entered into a contingent-fee
agreement under which Attorney Smith would represent Plaintiff in exchange for
twenty-five percent of past due benefits, if awarded. Mot. for Att’y Fees Ex. 5 (Fee
Agreement), ECF No. 27-5. The Supreme Court has held that courts should evaluate
such contingent-fee arrangements “by first looking to the agreement between the
attorney and the client, and then testing that agreement for reasonableness.” Joslyn
v. Barnhart, 389 F. Supp. 2d 454, 456 (W.D.N.Y. 2005) (citing Gisbrecht v. Barnhart,
535 U.S. 789, 808 (2002)). “Deference should be given . . . to the ‘freely negotiated
expression both of a claimant's willingness to pay more than a particular hourly rate
. . . and of an attorney's willingness to take the case despite the risk of nonpayment.’”
Id. (quoting Wells v. Sullivan, 907 F.2d 367, 371 (2d Cir.1990)).
However, a contingent-fee agreement is not per se reasonable.
Id.
When
assessing the reasonableness of the award, a court should balance the interest in
protecting claimants from inordinately large fees against the interest in ensuring
that attorneys are adequately compensated so that they continue to represent clients
in disability benefits cases. Gisbrecht, 535 U.S. at 805 (explaining the Congressional
intent of the provision). Several factors are important in making this determination:
This is in contrast to attorney fees awarded under the Equal Access to Justice Act (EAJA). The
EAJA provides that the agency against which the action was brought pays the attorney’s fees of the
prevailing party unless the court finds that the agency’s position was “substantially justified.” 28
U.S.C. § 2412(d).
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These factors include: 1) whether the requested fee is out of line with
the “character of the representation and the results the representation
achieved;” 2) whether the attorney unreasonably delayed the
proceedings in an attempt to increase the accumulation of benefits and
thereby increase her own fee; and 3) whether “the benefits awarded are
large in comparison to the amount of time counsel spent on the case,”
the so-called “windfall” factor.
Joslyn, 389 F. Supp. 2d at 456 (quoting Gisbrecht, 535 U.S. at 808).
As indicated above, Plaintiff’s fee agreement in this case plainly states that for
appeals of the Commissioner’s decision before a federal court “the attorney fee will be
1/4 (25 percent) of the past due benefits resulting from my claim.” Mot. for Att’y Fees
Ex. 5 (Fee Agreement), ECF No. 27-5. Hence, the fee agreement expresses a clear
contingent-fee arrangement that does not exceed the statutory maximum of twentyfive percent of past-due benefits. See 42 U.S.C. 406(b)(1)(A).
Moreover, the first and second reasonableness factors weigh in favor of
Attorney Smith’s request.
First, Attorney Smith clearly secured Plaintiff an
excellent result. Her briefing of the issues contributed to this Court’s holding that
the ALJ’s decision was not supported by substantial evidence, and on remand
Plaintiff was eventually determined to be entitled to $73,184 in past due benefits.
See, e.g., Lofton v. Berryhill, No. 6:17-CV-06459-MAT, 2019 WL 180673, at *2
(W.D.N.Y. Jan. 14, 2019) (“[c]ounsel’s effective briefing secured a reversal and
remand for further administrative proceedings. Following remand, an ALJ issued a
fully favorable decision.”).
Second, there is no indication that Attorney Smith
unreasonably delayed the proceedings to increase her own fee.
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With respect to assessing the third reasonableness factor, whether the fee
award constitutes a “windfall,” neither the Supreme Court nor the Second Circuit
have provided a bright-line test. See Goins o/b/o J.D.G. v. Berryhill, No. 6:16-CV06398-MAT, 2019 WL 311620, at *2 (W.D.N.Y. Jan. 24, 2019). Nevertheless, the
Supreme Court has suggested that conducting what is essentially a lodestar analysis
may be helpful, though not determinative. See Gisbrecht, 535 U.S. at 808 (observing
that the hours spent by counsel representing the claimant and counsel’s “normal
hourly billing charge for noncontingent-fee cases” may aid “the court’s assessment of
the reasonableness of the fee yielded by the fee agreement”). Further, the Second
Circuit has cautioned courts to be mindful that “payment for an attorney in a [S]ocial
[S]ecurity case is inevitably uncertain,” and recognize “that contingency risks are
necessary factors in determining reasonable fees under § 406(b).” Wells v. Berryhill,
No. 15-CV-0334-A, 2018 WL 6047273, at *2 (W.D.N.Y. Nov. 19, 2018) (citing Wells v.
Sullivan, 907 F.2d 367, 371 (2d Cir. 1990)). Lastly, other courts in this Circuit have
considered the evidence of effort expended by the attorney, the attorney’s experience
and efficiency, and the length of representation, including work done at the
administrative agency level. Trupia v. Astrue, No. 05-CV-6085, 2008 WL 858994, at
*4 (E.D.N.Y. March 27, 2008).
Taking the foregoing guidance into account, the Court notes that based on the
itemized statement submitted, Attorney Smith spent a total of 28.63 hours
representing Plaintiff in the district court. Mot. for Att’y Fees, Ex. 1 (Decl.), ¶ 11,
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Dec. 19, 2019, ECF No. 27-2. Attorney Smith has worked on Social Security cases
since 2016, and has handled 68 hearings before an ALJ and over 240 cases in this
district. Id. at ¶ 3–4. She did not represent Plaintiff at the administrative agency
level, but the work she completed during her 28.63 hours in the matter was largely
substantive. 4 Compare Devenish v. Astrue, 85 F.Supp.3d 634, 638 (2015) (noting
that “the record here shows that [counsel] spent a total of 9.5 hours reviewing the
Plaintiff’s records and files and discussing the case with the Plaintiff, while devoting
only 2.2 hours to drafting and filing the complaint, the only substantive legal
document filed in this case.”) Dividing the § 406(b)(1) fee requested ($18,023.50) by
the total hours expended by counsel (28.63) yields an effective hourly rate of $629.53,
as compared with Attorney Smith’s normal hourly rate of $300. Mot. for Att’y Fees
Ex. 1 (Decl.) at ¶ 14.
The Court takes seriously the fact that a contingency fee agreement “is the
freely negotiated expression both of a claimant’s willingness to pay more than a
particular hourly rate to secure effective representation, and of an attorney’s
willingness to take the case despite the risk of nonpayment.” Wells, 907 F.2d at 371.
The Court is also aware that “courts in this Circuit routinely approve fee awards in
the [S]ocial [S]ecurity context that are above the regular hourly rates.” Heffernan v.
According to her Declaration, Attorney Smith spent: two and one-half hours on her initial review of
the record and prior proceedings, approximately twenty hours on her motion for judgment on the
pleadings and supporting memorandum of law, and an additional five hours on the reply brief. Mot.
for Att’y Fees Ex. 1 (Declaration) at ¶ 11. By contrast, she spent only one and one-third hours on
clerical tasks and client correspondence, and one hour drafting her motion for attorney’s fees under
the EAJA. Id.
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Astrue, 87 F. Supp. 3d 351, 355 (E.D.N.Y. 2015) (citing Barbour v. Colvin, No. 12–
CV–00548 (ADS), 2014 WL 7180445, at *2 (E.D.N.Y. Dec. 10, 2014) (approving
$26,784 award for 44.7 hours of work); Warren v. Astrue, No. 06–CV–2933 CBA, 2011
WL 5402493, at *1 (E.D.N.Y. Nov. 7, 2011) (approving $25,000.00 for 38 hours of
work); and Rowell v. Astrue, No. 05–CV–1592 (CBA)(JMA), 2008 WL 2901602, at *5
(E.D.N.Y. July 28, 2008) (approving $27,413.19 for 72.25 hours of work).
Thus, in assessing whether Attorney Smith’s requested fee of $18,023.50 is
reasonable under § 406(b), the Court is very cognizant of the fact that Attorney Smith
assumes the risk of non-payment with all of the Social Security clients she represents.
Accordingly, the Court finds that an award of this fee—amounting to an hourly rate
of $629.53—satisfies the underlying policy goal of ensuring that claimants have
qualified counsel representing them in their Social Security appeals. Devenish, 85
F. Supp.3d at 639 (citing Muniz v. Astrue, No. 09-CV-3954 (ARR), 2011 WL 5563506,
at *6 (E.D.N.Y. Nov. 15, 2011)). This fee reasonably compensates an attorney of
Attorney Smith’s experience and competence in handling Social Security claims when
factoring in the risk of non-payment.
CONCLUSION
For the reasons set forth above, Attorney Smith’s motion [ECF No. 27] is
granted and Attorney Smith is awarded attorney’s fees in the amount of $18,023.50.
Upon receipt of this award, Attorney Smith is directed to refund to Plaintiff the
$5,561.28 in fees that Attorney Smith was previously awarded under the Equal
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Access to Justice Act. The Clerk is directed to close this case.
SO ORDERED.
DATED:
April 13, 2019
Rochester, New York
____________________________
CHARLES J. SIRAGUSA
United States District Judge
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