Goley v. Berryhill
Filing
34
MEMORANDUM OPINION AND ORDER: The Court GRANTS Plaintiff's counsel Howard D. Olinsky's Motion for Attorney Fees Pursuant to 28 U.S.C. § 406(b) [Dkt. No. 31 ] and AWARDS Mr. Olinsky $5,825.50 in attorneys' fees to be certifi ed for payment out of Plaintiff Luella B. G.'s past-due benefits under 42 U.S.C. § 406(b) and ORDERS Mr. Olinsky to refund the EAJA fees in the amount of $4,851.28 directly to Plaintiff Luella B.G. (Ordered by Magistrate Judge David L. Horan on 2/10/2021) (mcrd)
IN THE UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
LUELLA B.G.,
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Plaintiff,
V.
ANDREW SAUL, Commissioner
of Social Security,
Defendant.
No. 3:18-cv-969-BN
MEMORANDUM OPINION AND ORDER
Plaintiff Luella B. G.’s counsel Howard D. Olinsky has filed a Motion for
Attorney Fees Pursuant to 28 U.S.C. § 406(b). See Dkt. No. 31.
The Commissioner has not filed a response, and his deadline to do so has
passed.
For the reasons explained below, the Court GRANTS the motion.
Background
Plaintiff’s counsel explains that he
represented Plaintiff in a civil action before this court for judicial review
of the Commissioner’s decision denying Plaintiff’s applications for
Disability Insurance [B]enefits and Supplemental Security Income. On
August 20, 2019, the U.S. District Court for the Northern District of
Texas, Dallas Division, remanded the matter to the Social Security
Administration for further proceedings.
2. On September 19, 2019, an order awarding attorney’s fees of
$4,851.28 was ordered under the Equal Access to Justice Act (EAJA), 28
U.S.C. § 2412. Docket No. 30.
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Dkt. No. 32 at 1.
Legal Standards and Analysis
“Sections 406(a) and 406(b) of the Social Security Act provide for the
discretionary award of attorney’s fees out of the past-due benefits recovered by a
successful claimant in a Social Security action.” Murkeldove v. Astrue, 635 F.3d 784,
787 (5th Cir. 2011). While Section 406(a) governs the award of attorneys’ fees for
representing a claimant in administrative proceedings, Section 406(b) governs the
award of attorneys’ fees for representing a claimant in court. See Gisbrecht v.
Barnhart, 535 U.S. 789, 794 (2002). Section 406(b) provides:
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); see also Murkeldove, 635 F.3d at 788 (citing Gisbrecht, 535
U.S. at 800); accord Jackson v. Astrue, 705 F.3d 527, 531 (5th Cir. 2013) (holding that
Ҥ 406(b) fees are authorized in cases where an attorney obtains a favorable decision
on remand”).
Contingency fee agreements in Social Security cases are unenforceable to the
extent that they provide for fees exceeding 25% of past-due benefits. See Gisbrecht,
535 U.S. at 807. Even when contingency fee agreements are within the statutory
ceiling, Section “406(b) calls for court review of such arrangements as an independent
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check, to assure that they yield reasonable results in particular cases.” Id.
As the United States Court of Appeals for the Fifth Circuit has noted, the
Commissioner has no direct financial stake in the fee determination; rather, his role
resembles that of a “trustee” for the claimant. Jeter v. Astrue, 622 F.3d 371, 374 n.1
(5th Cir. 2010) (citing Gisbrecht, 535 U.S. at 798 n.6). It is the Court’s obligation to
review where the fees sought are reasonable.
The reasonableness of attorneys’ fees awarded pursuant to a fee-shifting
statute is generally determined by using the lodestar method. See Jeter, 622 F.3d at
374 n.1. But, noting that Section 406(b) is not a fee-shifting statute, the United States
Supreme Court has “explicitly rejected” the use of the lodestar method as the
“starting point” in determining the reasonableness of a fee under this statute.
Gisbrecht, 535 U.S. at 801. Instead, “lower courts [are] to give a contingency fee
agreement ‘primacy,’” although this will “in some instances result in an excessively
high fee award.” Jeter, 622 F.3d at 379.
The Court in Gisbrecht acknowledged that, “[i]f the benefits [resulting from a
contingency fee agreement] are large in comparison to the amount of time counsel
spent on the case, a downward adjustment is ... in order [to disallow windfalls for
lawyers].” 535 U.S. at 808. The Fifth Circuit has interpreted this language to mean
that courts may still employ the lodestar method in determining whether a
contingency fee constitutes a windfall but only if they “articulate additional factors
demonstrating that the excessively high fee would result in an unearned advantage.”
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Jeter, 622 F.3d at 379. For instance, a court may consider a reasonable hourly rate in
its “windfall” assessment, “so long as this mathematical calculation is accompanied
by consideration of whether an attorney’s success is attributable to his own work or
instead to some unearned advantage for which it would not be reasonable to
compensate him.” Id.
The Fifth Circuit has not prescribed an exhaustive list of factors to consider in
determining whether a fee award is unearned. It has noted with approval several
factors considered by lower courts, including “risk of loss in the representation,
experience of the attorney, percentage of the past-due benefits the fee constitutes,
value of the case to a claimant, degree of difficulty, and whether the client consents
to the requested fee.” Id. at 381-82 (citing Brannen v. Barnhart, No. l:99-CV-325, 2004
WL 1737443, at *5 (E.D. Tex. July 22, 2004)).
The claimant’s attorney bears the burden of persuasion on the reasonableness
of the fees sought. See Gisbrecht, 535 U.S. at 807 n.17.
As to the first factor, courts have consistently recognized that “there is a
substantial risk of loss in civil actions for social security disability benefits.” Charlton
v. Astrue, No. 3:10-cv-56-O-BH, 2011 WL 6325905, at *4 (N.D. Tex. Nov. 22, 2011)
(noting that, in the year 2000, only 35 percent of claimants who appealed their case
to federal court received benefits), rec. adopted, 2011 WL 6288029 (N.D. Tex. Dec. 14,
2011); see also Hartz v. Astrue, No. Civ. A. 08-4566, 2012 WL 4471846, at *6 (E.D. La.
Sept. 12, 2012) (collecting cases), rec. adopted, 2012 WL 4471813 (E.D. La. Sept. 27,
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2012). And Mr. Olinsky asks that the Court recognize “the contingent nature of the
representation.” Dkt. No. 32 at 3.
As to the other factors, Mr. Olinsky further explains that he
and Plaintiff entered into a valid contingency fee agreement which
stated that the attorney shall charge and receive as the fee an amount
equal to twenty-five percent of the past due benefits awarded to Plaintiff
and her family if she won her case. A copy of the contingency fee
agreement is attached as Exhibit A.
4. Total past due benefits for the Plaintiff were $47,302.00 based
on the June 22, 2020 SSD Notice of Award for August 2015 through May
2020, which was received by [Mr. Olinsky] on November 17, 2020. A copy
of this notice and email are attached as Exhibit B.
5. Under 42 U.S.C. § 406(b), this Court may award “a reasonable
fee not in excess of 25 percent of … past-due benefits” awarded to the
claimant. 42 U.S.C. § 406(b)(1)(A). ). One-fourth of past-due benefits are
$11,825.50.
6. Plaintiff’s agency attorney’s fee agreement was approved in the
amount of $6,000.00 for representation at the post-litigation hearing,
not the undersigned.
7. This reduces the available funds from the claimant’s past due
benefits to $5825.50. I am requesting $5,825.50 to be approved and paid
as 406(b) fees.
8. Should the Court award 406b fees in the amount of $5,825.50,
my office will refund the $4,851.28 EAJA payment previously received
to Plaintiff.
9. [Mr. Olinsky’s] win of a remand hearing from this Court has
resulted in a finding establishing that Plaintiff is disabled. [Mr. Olinsky]
has not represented Plaintiff in any other claim, aside from that under
the Social Security Act, regarding his disability.
10. Plaintiff’s attorneys and paralegals logged 27.9 hours at the
federal court level. Of those hours, 20.8 are attorney hours and 7.1 are
paralegal hours. If the paralegal hours are billed at $100.00 per hour
and deducted, the effective hourly attorney rate is $245.94. A copy of the
Professional Time is attached as Exhibit C. A copy of Attorney Time
individually is attached as Exhibit D. A copy of Paralegal Time
individually is attached as Exhibit E.
11. Given the contingent nature of the representation, the
contract between Plaintiff and his attorney and the absence of any
reasons the award would be unjust, and it is not a windfall.
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Id. at 2-3.
The undersigned agrees that, for the reasons that Mr. Olinsky explains, the
resulting hourly rate is reasonable under the circumstances of this case. And Mr.
Olinsky provided effective and efficient representation, expending almost 30 hours to
reach a favorable result. Given the lack of success at the administrative level,
counsel’s success appears to be attributable to his own work. Finally, while not
determinative, the existence of a contingency fee agreement indicates that Plaintiff
consented to the payment of a 25% fee. See Jeter, 622 F.3d at 381-82; Hartz, 2012 WL
4471846, at *6.
After weighing the relevant factors, the Court finds that the requested
contingency fee award in the amount of $5,825.50 is reasonable under the
circumstances of this case and should be awarded under Section 406(b).
Plaintiff was previously awarded attorneys’ fees under the EAJA. See Dkt. No.
30. Given the overlap between the EAJA and Section 406(b) of the Social Security
Act, “Congress harmonized fees payable by the Government under” these statutes by
requiring that the attorney “refund to [Plaintiff] the amount of the smaller fee.”
Gisbrecht, 535 U.S. at 796 (citation omitted); Rice v. Astrue, 609 F.3d 831,837-39 (5th
Cir. 2010). Here, Mr. Olinsky represents that he should be ordered refund those
EAJA fees in full to Plaintiff.
Conclusion
The Court GRANTS Plaintiff’s counsel Howard D. Olinsky’s Motion for
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Attorney Fees Pursuant to 28 U.S.C. § 406(b) [Dkt. No. 31] and AWARDS Mr. Olinsky
$5,825.50 in attorneys’ fees to be certified for payment out of Plaintiff Luella B. G.’s
past-due benefits under 42 U.S.C. § 406(b) and ORDERS Mr. Olinsky to refund the
EAJA fees in the amount of $4,851.28 directly to Plaintiff Luella B.G.
SO ORDERED.
DATED: February 10, 2021
_________________________________________
DAVID L. HORAN
UNITED STATES MAGISTRATE JUDGE
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