Rees v. Social Security Administration

Filing 28

OPINION AND ORDER AWARDING ATTORNEY'S FEES UNDER 42 USC:406(b) by Magistrate Judge Steven P. Shreder granting 25 Motion for Relief and 26 Motion for Attorney Fees (ndd, Deputy Clerk)

IN THE UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF OKLAHOMA
TIM M. REES,
Plaintiff,
v.
MICHAEL J. ASTRUE,
Commissioner of the Social
Security Administration,
Defendant.

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Case No. CIV-11-399-SPS

OPINION AND ORDER AWARDING
ATTORNEY’S FEES UNDER 42 U.S.C. § 406(b)
The Plaintiff appealed the decision of the Commissioner of the Social Security
Administration denying his request for benefits. The Court reversed the Commissioner’s
decision and remanded the case for further proceedings. On remand, the Administrative
Law Judge (“ALJ”) found that the Plaintiff was disabled and awarded him and his
auxiliary beneficiaries past-due benefits. The Plaintiff’s attorney now seeks an award of
attorney’s fees pursuant to 42 U.S.C. § 406(b)(1). For the reasons set forth below, the
Court finds that the Plaintiff’s Motion for Relief Pursuant to Fed. R. Civ. P. 60(b)(6)
[Docket No. 25] and Motion for Attorney Fees Pursuant to 42 U.S.C. § 406(b) [Docket
No. 26] should be GRANTED and that Plaintiff’s attorney should be awarded $16,537.10
in attorney’s fees.
The Court must initially determine if the motion at issue is timely. Section 406(b)
does not address when a motion for attorneys’ fees should be filed, so the Tenth Circuit
has instructed held that “the best option . . . is for counsel to employ Federal Rule of Civil

Procedure 60(b)(6) in seeking a § 406(b)(1) fee award.” McGraw v. Barnhart, 450 F.3d
493, 505 (10th Cir. 2006). Thus, a Section 406(b) motion for attorneys’ fees must be
filed within a reasonable time of receipt of the notice of award. See generally Fed. R.
Civ. P. 60(c)(1) (“A motion under Rule 60(b) must be made within a reasonable time[.]”).
In this district, “a reasonable time” means within thirty days of receipt of the notice of
award unless there is good reason for a lengthier delay. See, e. g., Harbert v. Astrue,
2010 WL 3238958 at *1 n. 4 (E.D. Okla. Aug. 16, 2010) (slip op.) (“The Court notes here
that while no explanation is needed for a Section 406(b)(1) motion filed within thirty
days of issuance of the notice of appeal, lengthier delays will henceforth be closely
scrutinized for reasonableness, including the reasonableness of efforts made by appellate
attorneys to obtain a copy of any notice of award issued to separate agency counsel.”).
The motion for attorneys’ fees in this case was filed on June 10, 2014, more than thirty
days after receipt of the notices of award on April 21, 2014, which the Plaintiff’s attorney
attributes to a “calendaring mistake” based on a supposed sixty-day filing period. The
Court is not entirely satisfied with this explanation, but inasmuch as the motion is less
than two weeks late and there are no timeliness objections by the Commissioner or the
Plaintiff, the Court declines to find that the motion was not filed within a reasonable time
under Fed. R. Civ. P. 60(b)(6). The Court therefore finds that the motion for attorneys’
fees under Section 406(b) is timely.
When “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
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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). The 25% limit does not include any fee
awarded by the Commissioner for representation in administrative proceedings pursuant
to 42 U.S.C. § 406(a). Wrenn v. Astrue, 525 F.3d 931, 937 (10th Cir. 2008) (“Based on
the plain language and statutory structure found in § 406, the 25% limitation on fees for
court representation found in § 406(b) is not itself limited by the amount of fees awarded
by the Commissioner.”). The request in this case is for $16,537.10, which is 25% of the
combined past due benefits due the Plaintiff and his auxiliary beneficiaries in accordance
with their attorney fee agreement. 1 See Docket No. 26 at p. 2 & Exs. 2-4. The Court
need therefore determine only if this amount is reasonable for the work performed in this
case. Gisbrecht v. Barnhart, 535 U.S. 789, 807 (2002) (“[Section] 406(b) 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 such arrangements as an independent check, to assure that they
yield reasonable results in particular cases.”). Factors include: (i) the character of the

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The notices of award in this case are not entirely clear as to the actual amount of past-due benefits
awarded to the Plaintiff and his beneficiaries. Each notice does, however, specify an amount being paid
directly to the addressee and an additional amount being withheld by the Commissioner for payment of
representative fees. The Plaintiff’s attorney calculates the beneficiaries’ past-due benefits by adding these
two amounts, i. e., the amount paid to the beneficiary plus the amount withheld for fees, but calculates the
Plaintiff’s past-due benefits by multiplying the amount withheld by the Commissioner for payment of
fees by four. In the absence of any objection by the Commissioner (who is after all responsible for the
notices of award), the Court is accepting at face value that these varying calculations do not result in the
Plaintiff’s attorney receiving more than 25% of the total past due benefits.

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representation and results achieved; (ii) whether any dilatory conduct might allow
attorneys to “profit from the accumulation of benefits during the pendency of the case in
court[;]” and, (iii) whether “the benefits are [so] large in comparison to the amount of
time counsel spent on the case” that a windfall results. Id. at 808, citing McGuire v.
Sullivan, 873 F.2d 974, 983 (7th Cir. 1989) (reducing fees for substandard work); Lewis
v. Secretary of Health & Human Services, 707 F.2d 246, 249-50 (6th Cir. 1983) (same);
Rodriguez v. Bowen, 865 F.2d 739, 746-47 (6th Cir. 1989) (noting fees are appropriately
reduced when undue delay increases past-due benefits or fee is unconscionable in light of
the work performed); Wells v. Sullivan, 907 F. 2d 367, 372 (2nd Cir. 1990) (court should
consider “whether the requested amount is so large as to be a windfall to the attorney”).
Contemporaneous billing records may be considered in determining reasonableness. Id.
at 808 (“[T]he court may require the claimant’s attorney to submit, not as a basis for
satellite litigation, but as an aid to the court’s assessment of the reasonableness of the fee
yielded by the fee agreement, a record of the hours spent representing the claimant and a
statement of the lawyer’s normal hourly billing charge for noncontingent-fee cases.”),
citing Rodriguez, 865 F.2d at 741.
Based on the factors enunciated in Gisbrecht, the Court concludes that $16,537.10
in attorneys’ fees is reasonable for the work done in this case. First, the attorneys ably
represented the Plaintiff in his appeal to this Court and obtained excellent results on his
behalf, i. e., a reversal of the Commissioner’s decision denying benefits and remand for
further consideration. The Plaintiff’s success on appeal enabled him not only to prevail
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in his quest for social security benefits, but also to obtain $5,259.80 in attorneys’ fees as
the prevailing party on appeal under the Equal Access to Justice Act, 28 U.S.C. §
2412(d), which will essentially reduce any amount awarded from his past-due benefits
pursuant to Section 406(b). Second, there is no evidence that the Plaintiff’s attorneys
caused any unnecessary delay in these proceedings. Third, the requested fee does not
result in any windfall to the Plaintiff’s attorneys, who spent a total of 27.3 hours on his
appeal. See Docket No. 26, Ex. 5. This would equate to a rate of $606.00 per hour at
most when accounting for the past-due benefits awarded to the Plaintiff and his auxiliary
beneficiaries, which is not excessive given that the fee was contingent and the risk of loss
was not negligible. The Court therefore concludes that the requested fee of $16,537.10 is
reasonable within the guidelines set by Gisbrecht.
The notice of award reflects that the Commissioner withheld funds from the past
due benefits to pay the fees of the Plaintiff’s representatives, but it is not clear if those
funds will be sufficient to satisfy the amount awarded herein to the Plaintiff’s attorneys.
While this would not prevent the Plaintiff’s attorneys from recovering the entire amount
awarded by the Court, it may require the attorneys to look to the Plaintiff rather than the
past due benefits to recover any deficiency after the Commissioner pays out any withheld
funds. See Wrenn, 525 F.3d at 933 (“If the amount withheld by the Commissioner is
insufficient to satisfy the amount of fees determined reasonable by the court, the attorney
must look to the claimant, not the past-due benefits, to recover the difference.”). Further,
because the $16,537.10 awarded herein pursuant to Section 406(b)(1) exceeds the
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$5,259.80 previously awarded to the Plaintiff under the EAJA, the Plaintiff’s attorneys
must refund the latter amount to the Plaintiff. See Weakley v. Bowen, 803 F.2d 575, 580
(10th Cir.1986).
Accordingly, the Plaintiff’s Motion for Relief Pursuant to Fed. R. Civ. P. 60(b)(6)
and Plaintiff’s Motion for Attorney Fees Pursuant to 42 U.S.C. § 406(b) [Docket Nos. 2526] are hereby GRANTED. The Court approves an award of attorney’s fees in the
amount of $16,537.10 to the Plaintiff’s attorneys pursuant to 42 U.S.C. § 406(b)(1), and
directs the Commissioner to pay to the Plaintiff’s attorneys the balance of any past-due
benefits in his possession up to said amount. The Plaintiff’s attorney shall thereupon
refund to the Plaintiff the full amount previously awarded under the EAJA.
IT IS SO ORDERED this 11th day of July, 2014.

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