Perrigo v. Social Security Administration
Filing
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OPINION AND ORDER by Magistrate Judge Frank H McCarthy ; granting 26 Motion for Attorney Fees (tjc, Dpty Clk)
IN THE UNITED STATES DISTRICT COURT FOR THE
NORTHERN DISTRICT OF OKLAHOMA
SUSAN JEANELLA PERRIGO, )
)
Plaintiff,
)
)
v.
)
)
CAROLYN COLVIN, Acting
)
Commissioner of the Social
)
Security Administration,
)
)
Defendant. )
Case No. 12-CV-186-FHM
OPINION AND ORDER
Plaintiff’s Counsel’s Motion for Attorney Fees under 42 U.S.C. 406(b), [Dkt. 26], is
before the Court. The Commissioner declines to assert a position about the
reasonableness of fees. [Dkt. 29].
In McGraw v. Barnhart, 450 F.3d 493, 496 (10th Cir. 2006), the Court ruled that
attorney fees are awardable under 42 U.S.C. § 406(b)(1) when the Social Security
Administration awards disability benefits to a claimant following a remand from the federal
court. In such a circumstance the authority of Fed. R. Civ. P. 60(b)(6) is employed to allow
counsel to seek fees under §406(b)(1) long after the usual fourteen days allotted by Fed.
R. Civ. P. 54((d)(2)(B)(I) for filing a motion for attorney fees has expired. McGraw, 450
F.3d at 505. On November 13, 2014, the court granted Counsel’s motion to extend the
date for filing the motion for fees under §406(b)(1) until 60 days after the Notice of Award
containing the amount of past due benefits was issued. [Dkt. 25]. Counsel has filed the
motion for fees within the 60 day period.
On July 1, 2013, the court remanded this case to the Commissioner for further
administrative action. [Dkt. 19]. On October 6, 2014, the Commissioner issued a fully
favorable decision awarding benefits to Plaintiff. By letter dated January 12, 2015, a Notice
of Award was provided which explained that 25% of past-due benefits, an amount of
$10,716.00, was being withheld for payment of attorney fees.
Counsel seeks approval of an attorney fee award of $8,000.00 pursuant to the terms
of 42 U.S.C. § 406(b) and the contingency fee contract between Plaintiff and counsel.
Counsel has certified that Plaintiff has been advised of the fee request, and Plaintiff has
expressed she does not object to the requested fee award. [Dkt. 27].
Section 406(b)(1) allows an award of attorney fees, payable from the past due
benefits withheld by the Social Security Administration, when the district court has
remanded a Social Security disability case for further proceedings and benefits are
awarded on remand. McGraw v. Barnhart, 450 F.3d 493 (10th Cir. 2006). 42 U.S.C. §
406(b)(1)(A) provides that a court may award “a reasonable fee . . . not in excess of 25
percent of the . . . past due benefits” awarded to the claimant. The fee is payable “out of,
and not in addition to, the amount of [the] past-due benefits.” Section 406(b)(1)(A) does
not replace contingency fee agreements between Social Security claimants and their
counsel. Instead, that section requires the district court to review contingency fee
agreements as an “independent check” to assure that the agreement yields a reasonable
result. Gisbrecht v. Barnhart, 535 U.S. 789, 807, 122 S.Ct. 1817, 1828, 152 L.Ed.2d 996
(2002). Section 406(b) provides a boundary that agreements are unenforceable to the
extent that they provide for fees exceeding 25 percent of the past-due benefits. Id.
In determining whether a fee resulting from a contingency fee contract is reasonable,
it is appropriate to adjust the attorney’s recovery based on the character of the
representation and the results the representation achieved. A reduction is in order if the
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attorney is responsible for delay, so the attorney will not profit from the accumulation of
past-due benefits while the case is pending in court. In addition, if the benefits are large
in comparison to the amount of time counsel spent on the case, the fee award may be
adjusted. Id. 535 U.S. at 808, 122 S.Ct. at 1828. Further, the burden to prove the fee is
reasonable is placed upon the attorney seeking the fee. Id. at n.17.
Plaintiff and counsel entered into a contract, [Dkt. 26-2], which is a contingency fee
arrangement that provides if the attorney prevails before the federal court on Plaintiff’s
behalf, and Plaintiff is awarded benefits by the Social Security Administration, Plaintiff
agrees to pay counsel a fee for federal court work equal to 25% of the past due benefits.
The undersigned concludes that the requested fee award of $8,000.00 which is
18.6% of Plaintiff’s past due benefit award as reflected in the record submitted is
reasonable. That award comports with the contract between counsel and Plaintiff and is
within the statutory limits of §406(b). The fee yields an hourly rate of approximately
$561.40 per hour for 14.25 hours of work performed before the district court, which does
not amount to a windfall. Often a fee recovery in a percentage-based contingency fee
contract will be higher than the fee produced by a straight hourly rate agreement. That
circumstance serves to induce attorneys to risk providing legal services in cases where
they may not be paid. And finally, when the amount of the EAJA fee award, $2,911.60, is
returned to Plaintiff in accordance with Weakley v. Brown, 803 F.2d 575, 580 (10th Cir.
1986), the net result is an out-of-pocket payment from Plaintiff of $5,088.40 which is
11.87% of his past due benefits.
Plaintiff’s Attorney’s Motion for an Award of Attorney Fees Under 42 U.S.C. § 406(b)
and Fed.R.Civ.P. 60(b)(6), [Dkt. 26], is GRANTED as follows:
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Counsel is awarded $8,000.00 to be paid from Plaintiff’s past due benefits being
withheld by the Commissioner for attorney fees. In accordance with Weakley v. Brown,
803 F.2d 575, 580 (10th Cir. 1986), upon receipt of payment, counsel is required to refund
$2,911.60 to Plaintiff, which is the amount of the EAJA awards.
SO ORDERED 12th day of February, 2015.
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