Herold v. Commissioner of Social Security

Filing 23

REPORT AND RECOMMENDATION that plaintiff's 19 MOTION for Attorney Fees UNDER THE EQUAL ACCESS TO JUSTICE ACT 28 U.S.C. SECTION 2412(d)(1)(A) be Granted and that plaintiff be Awarded $6,184.08 in attorney fees and $350.00 in costs. Objections to R&R due by 1/7/2013. Signed by Magistrate Judge Karen L. Litkovitz on 12/21/2012. (art)

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION

RUSSELL LYNN HEROLD,
Plaintiff,

Case No. 1:11-cv-758
Barrett, J.
Litkovitz, M.J.

vs.
COMMISSIONER OF
SOCIAL SECURITY,
Defendant.

REPORT AND
RECOMMENDATION

This matter is before the Court on plaintiffs motion and supporting memorandum for
attorney fees and costs under the Equal Access to Justice Act (EAJA) (Docs. 19, 20), the
Commissioner's response in opposition (Doc. 21), and plaintiffs reply memorandum. (Doc. 22).
For the reasons that follow, the Court recommends that plaintiffs motion be granted.

I. Substantial Justification
The EAJA provides for an award of attorney fees to a party who prevails in a civil action
against the United States "when the position taken by the Government is not substantially
justified and no special circumstances exist warranting a denial of fees." Bryant v. Comm 'r of
Soc. Sec., 578 F.3d 443,445 (6th Cir. 2009) (citing 28 U.S.C. § 2412(d)(l)(A)). The EAJA

provides:
A court shall award to a prevailing party other than the United States fees and
other expenses, in addition to any costs awarded pursuant to subsection (a),
incurred by that party in any civil action (other than cases sounding in tort),
including proceedings for judicial review of agency action, brought by or against
the United States in any court having jurisdiction of that action, unless the court
finds that the position of the United States was substantially justified or that
special circumstances make an award unjust.
28 U.S.C. § 2412(d)(l)(A).
In this case, plaintiff is the prevailing party. The Court reversed the non-disability

finding of the Administrative Law Judge (ALJ) and ordered a remand to the ALJ for further
proceedings pursuant to Sentence Four of 42 U.S.C. § 405(g). See Shalala v. Schaefer, 509 U.S.
292, 300-02 (1993) (social security claimant who obtains a sentence four judgment reversing
denial ofbenefits and requiring further proceedings is "prevailing party" for purposes ofEAJA).
In addition, the Commissioner's position during this litigation was not "substantially
justified." To be substantially justified, the United States must show that it had a reasonable
basis in law and in fact to undertake the challenged action. Pierce v. Underwood, 487 U.S. 552
(1988). The "substantial justification" standard under the EAJA is not the same as the
"substantial evidence" standard. The government's position "can be justified even though it is
not correct ... , and it can be substantially (i.e., for the most part) justified if a reasonable person
could think it correct, that is, if it has a reasonable basis in law and fact." !d. at 566 n.2. The
Sixth Circuit has held that even though the government's position was not supported by
substantial evidence, that fact "does not foreclose the possibility that the position was
substantially justified. Indeed, Congress did not want the 'substantially justified' standard to be
read to raise a presumption that the Government position was not substantially justified simply
because it lost the case .... " Howard v. Barnhart, 376 F.3d 551, 554 (6th Cir. 2004) (internal
citations and quotation marks omitted). Rather, under the EAJA, substantial justification means
the government's position was "justified in substance or in the main." Pierce, 487 U.S. at 565.
In other words, the Court must determine whether the government's position was justified in law
and in fact to a degree that would satisfy a reasonable person. !d. See also Perket v. Sec y of
H.H.S., 905 F.2d 129, 132 (6th Cir. 1990); Jankovich v. Bowen, 868 F.2d 867, 869 (6th Cir.

1989). It is the government's burden under the EAJA to prove that its position was substantially
justified. See Scarborough v. Principi, 541 U.S. 401, 414-15 (2004 ). The "'position of the

2

United States' means, in addition to the position taken by the United States in the civil action, the
action or failure to act by the agency upon which the civil action is based." 28 U.S.C. §
2412(d)(2)(D).
In the present case, the Court determined the Commissioner's decision lacked substantial
support in the record because the ALJ erred by discounting the supported opinion of plaintiffs
treating physician. (Doc. 14 at 14-24). The Court found that the ALJ erroneously discounted the
supported opinion of plaintiffs treating physician; misstated the objective and clinical evidence
of record regarding plaintiffs back injuries; improperly substituted his own lay opinion for that
of a medical professional; and failed to identify evidence supporting his opinion. (Doc. 14 at 1724). The Court determined that the matter should be reversed and remanded with directions to
the ALJ to properly evaluate the medical opinion evidence of record and to reformulate
plaintiffs RFC as necessary. !d. at 27-28.
The Commissioner has provided no argument that the government's position was
substantially justified. Accordingly, the Court finds that the Commissioner's position in this
matter was not substantially justified.
Further, no evidence in the record suggests that special circumstances bar a fee award
here, and the Court, after carefully reviewing the record, finds none. See 28 U.S.C. §
2412(d)(l)(A). Accordingly, the Court turns to an analysis ofthe amount of fees to which
plaintiffs counsel is entitled.
II. Amount of Fee Award

The EAJA authorizes an award of reasonable fees as follows:
The amount of fees awarded . . . shall be based upon prevailing
market rates for the kind and quality of the services furnished,
except that ... attorney fees shall not be awarded in excess of $125
per hour unless the court determines that an increase in the cost of
3

living or a special factor, such as the limited availability of
qualified attorneys for the proceedings involved, justifies a higher
fee.
28 U.S.C. § 2412(d)(2)(A).
Plaintiff requests an award of fees and costs in the amount of$ $6,535.31 for work done
in the district court. The costs sought by plaintiff represent the $350.00 district court filing fee.
Plaintiffs request for fees is based on an hourly rate of$175.47, which represents the $125.00
hourly rate set by the EAJA statute adjusted for inflation based on cost ofliving increases since
enactment of the EAJA. (Doc. 19, Ex. 2, ~ 11). Plaintiff argues that the requested $175.47
hourly rate is not excessive and is in keeping with the hourly rate paid to attorneys in the
Cincinnati area. In support ofhis request, plaintiffhas submitted evidence which includes
counsel's affidavit and an itemization of counsel's hours worked and costs expended prosecuting
this matter. (Doc. 20, attachments).
The Commissioner does not challenge the number of hours included in the fee request,
but challenges plaintiffs request for an increase in the EAJA statutory rate to $175.47 per hour,
arguing that plaintiff has failed to submit sufficient evidence to support a finding that the
requested increase is reasonable. (Doc. 21). Relying on Mathews-Sheets v. Astrue, 653 F.3d
560, 565 (7th Cir. 2011 ), the Commissioner contends that plaintiffs in Social Security cases must
show that absent a cost-of-living increase to bring the fee award up to the requested hourly rate,
competent Social Security counsel in the relevant geographical area could not be found. The
Commissioner asserts that this is not a standard plaintiff can meet here, citing to multiple local
attorneys who have requested hourly rates of only $125. (Doc. 21 at 4 n.l, citing Major v.
Comm 'r of Soc. Sec., No. 1:10-cv-530 (S.D. Ohio) (involving a Cincinnati practitioner); King v.
Comm 'r of Soc. Sec., No. 2:10-cv-800 (S.D. Ohio) (involving a Cleveland practitioner).

4

In reply, plaintiff argues that the requested $175.47 hourly rate is not excessive and is in
keeping with the hourly rate paid to attorneys in the Cincinnati area and to other attorneys
associated with plaintiffs firm, citing to decisions in the Southern District of Ohio awarding
EAJA fees at similar hourly rates. (Doc. 22, citing Newell v. Astrue, No. 3:07-cv-412, 2012 WL
936672 (S.D. Ohio Mar. 20, 2012) (Report and Recommendation), adopted, 2012 WL 1185991
(S.D. Ohio Apr. 9, 2012) (Rice, J.); Sturgeon v. Comm 'r of Soc. Sec., No. 1:08-cv-510, 2009 WL
5194385 (S.D. Ohio Dec. 22, 2009) (Beckwith, J.).
As an initial matter, the undersigned is not persuaded by the Commissioner's argument
that before the hourly rate may be increased based on the cost-of-living, plaintiff must prove that
no lawyer in the relevant geographical area is available to competently handle a Social Security
disability appeal. (Doc. 21 at 4, citing Mathews-Sheets, 653 F.3d at 565 (7th Cir. 2011)). First,
the Seventh Circuit's decision in Matthews-Sheets is not binding precedent on district courts
within the Sixth Circuit and courts within the Sixth Circuit have not required EAJA fee
applicants to provide proof of the lack of competent counsel within the relevant geographical
area. Second, the Commissioner's argument erroneously conflates the two separate provisions
justifying an increase in the $125.00 rate under EAJA. The statute provides that EAJA fees are
based on the prevailing market rate and should not exceed $125.00 per hour "unless the court
determines than an increase in the cost ofliving or a special factor, such as the limited
availability of qualified attorneys for the proceedings involved, justifies a higher fee." 28 U.S.C.
§ 2412(d)(2)(A) (emphasis added). 1 Therefore, the Court declines to reduce attorney fees on this

basis.

1

The undersigned notes that the court in Mathews-Sheets recognized that "a fee of$125 for legal services
rendered in 2009 in a social security disability appeal seems awfully low" and that even at the amount requested by
counsel in that case, "$170 an hour[,] the total fee award would be only $9,010." 653 F.3d at 564.

5

In determining the hourly rate for an attorney fee award, this Court must first consider the
prevailing market rate charged by Social Security practitioners in Southwestern Ohio. See 28
U.S.C. § 2412(d)(2)(A) (the amount ofEAJA fees "shall be based upon prevailing market rates
for the kind and quality of the services furnished .... ")(emphasis added). See also Blum v.
Stenson, 465 U.S. 886, 895 n.11 (1984) (in determining reasonableness of attorney fees court
must consider whether requested rates are in line with those prevailing in community for similar
services by lawyers of reasonably comparable skill, experience and reputation).
In Bryant v. Comm 'r ofSoc. Sec., 578 F.3d 443, 445 (6th Cir. 2009), the Sixth Circuit
upheld the district court's refusal to add a cost-of-living increase to the statutory EAJA rate of
$125.00. The Court of Appeals reiterated that the burden of justifying an increase in the
statutory hourly rate rests with the EAJA plaintiff. !d. at 450 (citing Blum, 465 U.S. at 898). In
the proceedings below in Bryant, the district judge stated that the plaintiffs burden to establish
the prevailing market rate may be met through "evidence of legal fees charged in the same
geographic area for the pertinent area of practice" and that the district court may take "judicial
notice of the historical fee reimbursement rate in the district." Turner v. Astrue, No. 06-450,
2008 WL 2950063, at *1 (E.D. Ky. July 30, 2008), aff'd sub nom., Bryant v. Comm 'r of Soc.
Sec., 578 F.3d 443 (citing London v. Hatter, 134 F. Supp.2d 940,941-942 (E.D. Tenn. 2001)).
The district court determined that an increase in the statutory hourly rate was not justified in the
two cases before it because the plaintiffs' counsel had failed to provide proof that the reasonable
and customary attorney fee for comparable work in the relevant geographical area exceeded
$125.00 per hour. The Court of Appeals found no abuse of discretion by the district court in
limiting the hourly rate to the $125.00 statutory rate where the plaintiffs' attorney submitted only
the Department of Labor's Consumer Price Index to support the request for an increase in the

6

statutory hourly rate based on inflation. Bryant, 578 F.3d at 450.
In light of Bryant, this Court has previously required plaintiffs' counsel to submit
evidence justifying an increase in the statutory hourly rate, including evidence of counsel's own
customary hourly rate, the requested cost-of-living increase, and the prevailing rate in the local
community charged by Social Security practitioners of similar skill, experience, and reputation.

See, e.g., Ayers v. Astrue, No.l:10-cv-30, 2011 WL 5506096, at *4 (S.D. Ohio Oct. 18, 2011)
(Report and Recommendation), adopted, 2011 WL 5445927 (S.D. Ohio Nov. 10, 2011) (Barrett,
J.) (awarding $170.00 per hour in EAJA fees); Sturgeon, 2009 WL 5194385, at *4-5 (awarding
$170.00 per hour in EAJA fees). In these cases, the plaintiff provided an affidavit of counsel, as
well as copies of publications showing average billable hourly rates nationally and in Cincinnati
establishing that the requested hourly rates were in line with the prevailing market rates for the
relevant geographic area. See, e.g., Ayers, No. 1:1 0-cv-30, 2011 WL 5506096, at *4 (noting
October 2007 study showing average billable hourly rate of$175 for the Greater Cincinnati area
and 2004 report showing mean billable hourly rate of$213 for downtown Cincinnati law firms).
The undersigned notes that more recently a 2010 Ohio State Bar Association Survey of attorney
fee rates shows a mean hourly rate of $231 per hour for Greater Cincinnati, $251 per hour for
downtown Cincinnati, and $209 per hour for suburban Cincinnati. See The Economics of Law
Practice in Ohio, Ohio State Bar Association (found at http://www.ohiobar.org/General%
20Resources/pub/201 0_Economics_of_Law_Practice_ Study. pdf). The Court is permitted to
consider evidence oflegal fees charged in the same geographic area, as well as take judicial
notice of the historical fee reimbursement rate in this district, in determining the prevailing
market rate for the case before the Court. See Turner, No. 06-450, 2008 WL 2950063, at * 1.

See also Saxton v. Astrue, No. 3:11-cv-303, 2012 WL 3078821 (S.D. Ohio July 30, 2012)

7

(Black, J.) (awarding $177.66 per hour); Wagner v. Comm 'r of Soc. Sec., No. 1:10-cv-784, 2012
WL 1224736 (S.D. Ohio Apr. 11, 2012) (Report and Recommendation), adopted, 2012 WL
1656973 (S.D. Ohio May 10, 2012) (Dlott, J.) (awarding $176.49 per hour); Renneker v. Astrue,
No. 1:10-cv-386, 2012 WL 12696 (S.D. Ohio Jan. 4, 2012) (Beckwith, J.) (awarding $176.49
per hour).
In this case, the hourly rate requested by counsel is in keeping with the prevailing market
rate for the Southwestern Ohio geographic area. In light of the cases in the Southern District of
Ohio cited above, as well as the survey from the Ohio State Bar Association, the undersigned
takes judicial notice that the prevailing market rate in the local Cincinnati and Southwestern
Ohio communities charged by Social Security practitioners of similar skill, experience, and
reputation is at least $176.47 per hour (the amount requested by counsel). In addition, the
evidence submitted by counsel in the instant case (Doc. 19, Ex. 2, affirmation of plaintiffs
counsel Charles E. Binder) confirms that the prevailing market rate in the relevant community is
at least $175.47 per hour.
Plaintiff also seeks an increase in the $125.00 statutory rate based on a cost ofliving
adjustment. See Begley v. Sec yof HHS., 966 F.2d 196, 199, 200 (6th Cir. 1992) (increase
based on cost ofliving is within discretion of district court). The Court finds that an increase in
the statutory $125.00 fee is appropriate, given the nature of the case in question and the increase
in the cost ofliving since the amendment ofEAJA. Plaintiff seeks attorney fees for work
performed in 2010,2011, and 2012 at an hourly rate of$175.47. Plaintiff seeks one hourly rate
for all three years based on the CPI for Midwest urban consumers. 2 However, plaintiff cites to
no authority for applying the CPI for this category, and the Court is not aware of any EAJA cases

2

Plaintiff does not specify whether the requested rate is based on the CPI for Services or All Items.

8

where the CPI for all urban consumers has been applied. Instead, judges in this district have
applied the CPI for either Services or All Items in calculating the appropriate cost of living
increase. See Adkins v. Comm 'r ofSoc. Sec., No. 1:07cv073, 2011 WL 2020647, at *2 (S.D.
Ohio May 24, 2011) (Barrett J.) (recognizing discrepancy among decisions and citing cases). 3
The Court in Adkins determined that the appropriate index is that found in the "All Items"
category; thus, the undersigned shall apply the CPI for All Items in the instant case. Id.
Plaintiff seeks attorney fees for work performed in 2010, 2011, and 2012. Plaintiff has
requested one hourly fee for each year rather than the requesting distinct rates for each year. As
this is not the preferred method of calculating a fee award, the Court will apply the annual rates
for 2010,2011, and 2012 in the instant matter. See Marcus v. Shalala, 17 F.3d 1033, 1040 (6th
Cir. 1994). Consequently, the Court will set the hourly rate for work performed in 2010 at
$173.83; plaintiff will receive his requested hourly rate of$175.47 for work performed in 2011
and 2012. 4
The Court also considers the affidavit of plaintiffs counsel which sets forth counsel's
credentials and extensive experience handling Social Security disability cases. (Doc. 19, Ex. 2).
The Court finds this information amply demonstrates that the hourly rates of $173.83 and
$175.47 are reasonable and warranted given the cost ofliving increases since enactment of the
EAJA and the rates prevailing in the community for similar services by lawyers of reasonably
comparable skill, experience, and reputation. See Bryant, 578 F.3d at 450.
Plaintiff has not requested an increase in the rate based upon any "special factor." See 28

3

The Court in Adkins used the CPI index for the Midwest region without addressing whether it was
appropriate to use this index as compared to the U.S. City average index given that the Commissioner did not object
to the use of the regional index. !d. at *1, n.2. This Court will likewise use the CPI indices for the Midwest region
in the present case.
4
Under the CPI for Midwest urban consumers for all items, the hourly rate for work performed in 2010 is
$173.83. The hourly rate for work performed in 2011 is $179.43, and for work performed in 2012 is $183.08, which

9

U.S.C. § 2412(d)(2)(A). Accordingly, the Court need not address the "special factor" inquiry.
In light ofthe above findings, the Court finds that plaintiff is entitled to attorney's fees
for 0.75 hours of work at an hourly rate of$173.83 and 34.50 hours of work at an hourly rate of
$175.47, yielding a fee award of$6,184.08. The award is payable to plaintiff rather than
plaintiffs counsel. See Astrue v. Ratliff,_ U.S._, 130 S.Ct. 2521, 2529 (2010). See also

Renneker v. Astrue, No. 1:10-cv-386, 2012 WL 12696, at *2 (S.D. Ohio Jan. 4, 2012) (Beckwith,
J.) (noting that "assignment of an EAJA award executed in advance of any actual award, violates
the Anti-Assignment Act, 31 U.S.C. § 3272" and that to make an award directly to the attorney
before the Commissioner determines whether the plaintiff owes a pre-existing debt to the United
States against which the EAJA fee award could be offset "would jeopardize the ability ofthe
United States to collect such debts, if any exist"). As the award ofEAJA fees may be offset
against any pre-existing debt plaintiff may owe to the United States, the fee must be made to
plaintiff and not to plaintiffs attorney.
The Court therefore RECOMMENDS that the EAJA fee petition be GRANTED and
that plaintiff be AWARDED $6, 184.08. in attorney fees and $350.00 in costs.

Date:

~£~

12_.k ,J;z._
r

.

Karen L. Litkok
United States Magistrate Judge

exceeds plaintiffs requested rate of$175.47 per hour for work performed in 2011 and 2012.

10

UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
WESTERN DIVISION

RUSSELL LYNN HEROLD,
Plaintiff,

Case No. 1:11-cv-758
Barrett, J.
Litkovitz, M.J.

vs.
COMMISSIONER OF
SOCIAL SECURITY,
Defendant.

NOTICE

Pursuant to Fed. R. Civ. P. 72(b), WITHIN 14 DAYS after being served with a copy of
the recommended disposition, a party may serve and file specific written objections to the
proposed findings and recommendations. This period may be extended further by the Court on
timely motion for an extension. Such objections shall specify the portions of the Report objected
to and shall be accompanied by a memorandum oflaw in support of the objections. If the Report
and Recommendation is based in whole or in part upon matters occurring on the record at an oral
hearing, the objecting party shall promptly arrange for the transcription of the record, or such
portions of it as all parties may agree upon, or the Magistrate Judge deems sufficient, unless the
assigned District Judge otherwise directs. A party may respond to another party's objections

WITHIN 14 DAYS after being served with a copy thereof. Failure to make objections in
accordance with this procedure may forfeit rights on appeal. See Thomas v. Arn, 474 U.S. 140
(1985); United States v. Walters, 638 F.2d 947 (6th Cir. 1981).

11