Crawford v. Commissioner of Social Security

Filing 26

ORDER GRANTING 21 MOTION FOR ATTORNEY FEES UNDER 42 U.S.C. § 406(b). Signed by Judge James D. Todd on 7/5/17. (Todd, James)

IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF TENNESSEE
EASTERN DIVISION
WAYNE CRAWFORD,
Plaintiff,
VS.
NANCY A. BERRYHILL, Acting
Commissioner of Social Security,
Defendant.

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No. 12-1263-JDT

ORDER GRANTING MOTION FOR ATTORNEY FEES
UNDER 42 U.S.C. § 406(b)

On April 16, 2013, pursuant to sentence four of 42 U.S.C. § 405(g), the Court
reversed the Commissioner’s decision that Plaintiff Wayne Crawford was not disabled and
remanded the case for additional administrative proceedings. (ECF No. 14.) The Court
subsequently granted Plaintiff an attorney fee in the amount of $4,195.64 under the Equal
Access to Justice Act (EAJA), 28 U.S.C. § 2412(d)(1)(A).1 (ECF No. 20.) Following an
award of benefits from the Social Security Administration (SSA), Plaintiff filed a motion for
attorney fees pursuant to the Social Security Act, 42 U.S.C. § 406(b). (ECF No. 21.) The
Commissioner has filed a response asserting that the requested fee is unreasonable (ECF No.
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Plaintiff states that almost half of the EAJA fee was withheld for payment of a debt he
owed to the United States in the amount of $2,046.00. See Astrue v. Ratliff, 560 U.S. 586 (2010)
(holding that EAJA fees belong to the litigant rather than to the attorney and may be offset to
satisfy the litigant’s pre-existing debt to the Government). Thus, counsel received only
$2,149.64 of the EAJA fee awarded by the Court.

22), and Plaintiff subsequently filed a reply in support of the fee petition (ECF No. 25).
Under § 406(b), in social security disability cases attorney fees may not exceed 25%
of the past-due benefits to which a claimant is entitled. The SSA generally withholds 25%
of past-due benefits for the potential payment of those fees. In this case, Plaintiff and his
attorney, John D. Hamilton, entered into a contingent-fee agreement at the beginning of the
representation in which it was specifically agreed that counsel would receive the 25% fee.
(ECF No. 21-2.) Plaintiff’s award letter indicates that the SSA has withheld the sum of
$26,713.75 from the past-due benefits for the payment of fees. (ECF No. 21-1.) Plaintiff
asks the Court to award $24,546.11 of that amount to counsel for 22.7 hours of work before
the Court ($26,713.75 less $2,149.64, the portion of the EAJA fee already paid to counsel).2
In Gisbrecht v. Barnhart, 535 U.S. 789 (2002), the Supreme Court rejected the use
of the “lodestar” method of awarding attorney fees under the Social Security Act, holding
that contingent-fee agreements should be honored by the courts as long as the resulting fee
is reasonable and there are no other factors warranting a reduction. Id. at 808. There is a
rebuttable presumption that the agreement is reasonable. Rodriquez v. Bowen, 865 F.2d 739,
746 (6th Cir. 1989) (en banc). Courts should consider “‘the character of the representation
and the results of the representation achieved,” whether “the attorney is responsible for
delay,” the amount of time expended on the case, and whether approving the fee would result
in a windfall to the attorney. Gisbrecht, 535 U.S. at 808.

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Because the entire amount withheld is being requested for work done before this Court,
it is presumed that counsel has not sought any fees for work done at the administrative level.
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Whitehead v. Barnhart, No. 1:04-1236-T, 2006 WL 681168, at *3 (W.D. Tenn. Mar. 14,
2006).
An award is not unreasonable simply because it yields an above-average hourly rate.
In Royzer v. Sec’y of Health and Human Servs., 900 F.2d 981 (6th Cir. 1990), the Court
stated:
It is not at all unusual for contingent fees to translate into large hourly rates .
. . . In assessing the reasonableness of a contingent fee award, we cannot
ignore the fact that the attorney will not prevail every time. The hourly rate in
the next contingent fee case will be zero, unless benefits are awarded.
Contingent fees generally overcompensate in some cases and undercompensate
in others. It is the nature of the beast.
Id. at 982. In Hayes v. Sec’y of Health and Human Servs., 923 F. 2d 418, 422 (6th Cir.
1990), the Sixth Circuit explained that “a windfall can never occur when, in a case where a
contingent fee contract exists, the hypothetical hourly rate . . . is less than twice the standard
rate for such work in the relevant market.” See also Lasley v. Comm’r of Soc. Sec., 771 F.3d
308 (6th Cir. 2014). Furthermore, “[a] true ‘windfall’ in this context . . . must mean more
than that the attorney happened to end up working substantially fewer hours to obtain the
contingent-fee than he would have been required to expend to earn the same fee based on an
hourly rate.” Whitehead, 2006 WL 681168, at *4.
In this case, the hypothetical hourly rate of $1,176.82 is very large, more than four
times the rate on which the EAJA fee was based. The Commissioner asserts, based solely
on the size of that hypothetical rate, that the requested award is unreasonable. However, the
Hayes formula of “twice the standard rate” is a floor rather than a ceiling, and the Court finds

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that the requested fee would not result in a windfall in this case. Plaintiff’s attorney is an
experienced social security practitioner who has achieved excellent results for his client
which included over $100,000.00 in past-due benefits. It does not appear that those benefits
accumulated due to any delay on the part of counsel or that the representation was in any way
substandard.
The Court concludes that the fee requested in this case is reasonable. Therefore,
pursuant to 42 U.S.C. § 406(b), the motion for attorney fees is GRANTED in the amount of
$24,564.11, to be paid to Plaintiff’s counsel.
IT IS SO ORDERED.
s/ James D. Todd
JAMES D. TODD
UNITED STATES DISTRICT JUDGE

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