Reed v. Commissioner of Social Security
REPORT AND RECOMMENDATIONS: re 19 MOTION for Attorney Fees filed by Clayton Reed. It is RECOMMENDED that Plaintiffs Motion be GRANTED. It is further RECOMMENDED that the Court AWARD Plaintiff attorneys fees in the amount of $5775.00. Objections to R&R due by 10/11/2017. Signed by Magistrate Judge Elizabeth Preston Deavers on September 27, 2017. (jlk)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO
Case No. 2:16-cv-0002
JUDGE MICHAEL H. WATSON
Magistrate Judge Elizabeth P. Deavers
COMMISSIONER OF SOCIAL
REPORT AND RECOMMENDATION
This matter is before the Court for consideration of Plaintiff’s Motion for Approval of
Attorney Fees Under 42 U.S.C. § 406(b). (ECF No. 19.) The Commissioner of Social Security
has responded to Plaintiff’s Motion. (ECF No. 22.) For the reasons that follow, it is
RECOMMENDED that Plaintiff’s Motion be GRANTED. It is further RECOMMENDED
that the Court AWARD Plaintiff attorney’s fees in the amount of $5775.00.
On December 15, 2015, Plaintiff filed this action under 42 U.S.C. § 405(b) for review of
a final decision of the Commissioner of Social Security denying Plaintiff’s application for a
period of disability and disability insurance benefits. (ECF No. 1.) On September 13, 2016, the
Court reversed the decision of the Commissioner and remanded the action, pursuant to Sentence
4 of 42 U.S.C. § 405(g), for further administrative proceedings. (ECF Nos. 17 and 18.)
Following remand, the Administrative Law Judge issued a fully favorable decision on June 28,
2017, finding Plaintiff disabled as of August 1, 2012. (ECF No. 19-1.) The amount of past due
benefits owed plaintiff was calculated at $32,424.00 (ECF No. 19-3.) The Commissioner
withheld $8,106 (or 25% of the past due benefits) for attorney’s fees. (Id.; ECF No. 19 at 3.)
On August 7, 2017, Plaintiff filed a Motion for Approval of Attorney Fees Under 42
U.S.C. § 406(b), seeking a fee award of $5775.00.1 (ECF No. 19.) The Commissioner has
reviewed Plaintiff’s Motion for Attorney Fees and supporting exhibits and concluded that the
requested fee is consistent with the 25% cap provided by § 406(b) and with the fee agreement
signed by Plaintiff and counsel. (ECF No. 22.) The Commissioner therefore does not oppose
the Motion for Fees. (Id.)
Counsel moves for fees pursuant to 42 U.S.C. § 406(b), which provides in relevant part:
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). Pursuant to this statute, the Court may only award fees for work done
at the district court level. Horenstein v. Sec’y of Health & Human Servs., 35 F.3d 261, 262 (6th
Cir. 1994) (“[I]n cases where the court remands the case back to the Secretary for further
proceedings, the court will set the fee—limited to 25 percent of past-due benefits—for the work
performed before it, and the Secretary will award whatever fee the Secretary deems reasonable
for the work performed on remand and prior administrative proceedings.”); see also Gisbrecht v.
Barnhart, 535 U.S. 789, 794 (2002) (“The statute deals with the administrative and judicial
review stages discretely: § 406(a) governs fees for representation in administrative proceedings;
§ 406(b) controls fees for representation in court.”).
Plaintiff’s counsel submitted a fee petition in the amount of $2331.00 at the administrative
level. (ECF No. 19 at 2–3.) The current fee request of $5775.00 sought in this Court is separate
and in addition to the $2331.00. (Id.)
In evaluating the reasonableness of requested fees, the Court “begin[s] by using twentyfive percent of the past due benefits as a benchmark.” Rodriquez v. Bowen, 865 F.2d 739, 746
(6th Cir. 1989) (“While we use that mark as a starting point for the court’s analysis, we
emphasize that it is not to be viewed as per se reasonable.”). When a claimant has entered into a
contingency fee agreement entitling counsel to twenty-five percent of past-due benefits awarded,
the Court presumes, subject to rebuttal, that the contract is reasonable. Id. at 746. The Court,
however, still stands as an “independent check” on the reasonableness of such arrangements.
Gisbrecht v. Barnhart, 535 U.S. 789, 807 (2002).
In assessing the reasonableness of a fee, the Court can consider a variety of factors
including the hours spent in representation and “the lawyer’s normal hourly billing charge for
noncontingent-fee cases.” Id. at 808. The Court should reduce fees in situations where counsel
“would otherwise enjoy a windfall because of either an inordinately large benefit award or from
minimal effort expended.” Rodriquez, 865 F.2d at 746. Even in contingency-agreement cases,
the Court may calculate hourly rates in considering whether an award results in a windfall.
Hayes v. Sec’y of Health & Human Servs., 923 F.2d 418, 421–22 (6th Cir. 1990). The United
States Court of Appeals for the Sixth Circuit, however, has expressed dissatisfaction with the use
of an across-the-board, strict hourly rate limitation:
[A] windfall can never occur when, in a case where a contingent fee contract
exists, the hypothetical hourly rate determined by dividing the number of hours
worked for the claimant into the amount of the fee permitted under the contract is
less than twice the standard rate for such work in the relevant market. We believe
that a multiplier of 2 is appropriate as a floor in light of indications that social
security attorneys are successful in approximately 50% of the cases they file in
the courts. Without a multiplier, a strict hourly rate limitation would insure that
social security attorneys would not, averaged over many cases, be compensated
Id. at 422.
Here, in light of the information provided, the Court finds that counsel’s requested fees
are reasonable. Counsel requests $5775.00 for sixteen and a half hours of work, resulting in an
hourly rate of $350.00. (ECF No. 19 at 6.) Although this rate may exceed the “multiplier of 2”
floor set in Hayes, the Court cannot say, given the contingent nature of Social Security Appeals,
that such a fee results in an unjust windfall. Furthermore, counsel has produced a contingency
fee agreement indicating that Plaintiff agreed to pay her twenty-five percent of any past-due
benefits awarded. (ECF No. 19-2.) The attorney fees counsel now requests is much less than
this twenty-five percent figure. Finally, the Undersigned notes that the Commissioner does not
oppose the request for fees because “the motion is consistent with § 406(b)’s requirements, is in
accord with the fee agreement, and is otherwise reasonable.” (ECF No. 22 at 1–2.)
For the foregoing reasons, it is RECOMMENDED that Plaintiff’s Motion for Approval
of Attorney Fees Under 42 U.S.C. § 406(b) be GRANTED and authorize Plaintiff’s counsel
attorney fees in the amount of $5775.00. (ECF No. 19.)
PROCEDURE ON OBJECTIONS
If any party seeks review by the District Judge of this Report and Recommendation, that
party may, within fourteen (14) days, file and serve on all parties objections to the Report and
Recommendation, specifically designating this Report and Recommendation, and the part in
question, as well as the basis for objection. 28 U.S.C. ' 636(b)(1); Fed. R. Civ. P. 72(b).
Response to objections must be filed within fourteen (14) days after being served with a copy.
Fed. R. Civ. P. 72(b).
The parties are specifically advised that the failure to object to the Report and
Recommendation will result in a waiver of the right to de novo review by the District Judge and
waiver of the right to appeal the judgment of the District Court. See, e.g., Pfahler v. Nat=l Latex
Prod. Co., 517 F.3d 816, 829 (6th Cir. 2007) (holding that “failure to object to the magistrate
judge’s recommendations constituted a waiver of [the defendant=s] ability to appeal the district
court’s ruling”); United States v. Sullivan, 431 F.3d 976, 984 (6th Cir. 2005) (holding that
defendant waived appeal of district court’s denial of pretrial motion by failing to timely object to
magistrate judge's report and recommendation). Even when timely objections are filed, appellate
review of issues not raised in those objections is waived. Robert v. Tesson, 507 F.3d 981, 994
(6th Cir. 2007) (“[A] general objection to a magistrate judge’s report, which fails to specify the
issues of contention, does not suffice to preserve an issue for appeal . . . .”) (citation omitted)).
IT IS SO ORDERED.
Date: September 27, 2017
/s/ Elizabeth A. Preston Deavers
ELIZABETH A. PRESTON DEAVERS
UNITED STATES MAGISTRATE JUDGE
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