Sinclair v. Commissioner of Social Security

Filing 33

ENTRY ORDER granting in part and denying in part 30 MOTION for Attorney Fees Pursuant to 406(b). The court finds a reasonable attorney's fee award is $13,534.25 comprised of the following: $10,400.00 attorney's fees and & #036;3,134.25 paralegal fees. In paying the award, the Commissioner is hereby ORDERED to reflect the $6,950.00 in EAJA fees previously awarded. The remaining amount withheld shall be paid to Plaintiff. Signed by Judge Christina Reiss on 2/14/2023. (sjl)

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UNITED STATES DISTRICT COURT
FOR THE
DISTRICT OF VERMONT
THERESA S.,
Plaintiff,
V.

COMMISSIONER OF SOCIAL SECURITY,
Defendant.

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2023 FEB I 4 AH IO:

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Case No. 2: l 7-cv-122

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ENTRY ORDER
GRANTING IN PART AND DENYING IN PART
PLAINTIFF'S APPLICATION FOR ATTORNEY'S FEES
(Doc. 30)
Plaintiff Theresa Sinclair brought this action for Social Security Disability
Insurance Benefits ("DIB") and Supplemental Security Income ("SSI") under 42 U.S.C.
§ 405(g) of the Social Security Act to reverse the decision of the Social Security
Commissioner (the "Commissioner") that she was not disabled. On April 1, 2019, the
court granted Plaintiffs motion to reverse the decision of the Commissioner and
remanded the action for further administrative proceedings. Plaintiff and the
Commissioner stipulated to a fee award of $6,950.00 pursuant to the Equal Access to
Justice Act ("EAJA"), 28 U.S.C. § 2412, which the court approved on July 18, 2019.
On September 20, 2022, the Social Security Administration ("SSA") favorably
adjudicated Plaintiffs claim and issued Plaintiff a Notice of Award which advised her
that she was entitled to past due benefits in the amount of $89,516.00. The SSA further
advised that it had withheld $22,379.00 from her benefits to pay a possible attorney fee
request.
On September 28, 2022, Plaintiff timely filed an application in this court for
$22,379.00 in attorney's fees pursuant to 42 U.S.C. § 406(b), representing twenty-five
percent of past due benefits owed to Plaintiff from July 2014 through September 2022,

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the period of time covered in this remand decision. (Doc. 30.) In support of the
application, Plaintiffs attorney submitted a declaration wherein he asserts he expended
20 .8 hours of attorney time and 29 .85 hours of paralegal time in pursuing Plaintiffs
appeal. Plaintiffs attorney's normal billing rate is $350.00 an hour and his paralegal's
normal billing rate is $105.00 per hour. Without any reduction of hours incurred, normal
billing rates result in fees of$13,534.25, slightly more than half of the fees requested.
As an exhibit to his declaration, Attorney Jackson submits a copy of the fee
agreement between Plaintiff and the Law Firm of Jackson & MacNichol, wherein
Plaintiff agreed to a contingency fee of twenty-five percent of any past-due benefits
awarded. See Doc. 30-4 at 2. Plaintiffs attorney acknowledges "[f]rom any award which
exceeds the amount of $6,950.00 previously awarded as EAJA fees in this case counsel
[must] remit to [Plaintiff] the smaller of the two awards." (Doc. 30 at 5.)
On October 12, 2022, the Commissioner filed a response to Plaintiffs application
and asked the court to decide whether the fee requested is reasonable. See Gisbrecht v.

Barnhart, 535 U.S. 789, 798 n.6 (2002) (ruling the Commissioner "has no direct financial
stake in the answer to the § 406(b) question; instead, [he or] she plays a part in the fee
determination resembling that of a trustee for the claimants."). Plaintiff has not filed a
reply. The Commissioner does not contest the proposed paralegal billing rate or the
number of hours the paralegal expended, and the court finds them reasonable. See Richlin

Sec. Serv. Co. v. Chertoff, 553 U.S. 571, 590 (2008) (holding "a prevailing party that
satisfies EAJA's other requirements may recover its paralegal fees from the Government
at prevailing market rates"); Garcia v. Comm 'r ofSoc. Sec., 2022 WL 1684280, at *2
(S.D.N.Y. May 26, 2022) (finding paralegal rate of $100.00 per hour reasonable).
Accordingly, the only issue is the reasonableness of the attorney's fees.
When a claimant prevails on his or her appeal of the Commissioner's disability
determination in federal court, 42 U.S.C. § 406(b) allows the court to award the attorney
who represented the claimant "a reasonable fee for such representation, not in excess of
[twenty-five] 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)(l)(A). Section 406(b) "does not
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displace contingent-fee agreements as the primary means by which fees are set for
successfully representing Social Security benefits claimants in court" provided the
agreements do not award fees in excess of twenty-five percent of past-due benefits.
Gisbrecht, 535 U.S. at 807; see also Wells v. Sullivan, 907 F.2d 367, 370 (2d Cir. 1990)
("[Section] 406(b) does not invalidate all contingent fee arrangements-it merely sets
their upper limit[.]"). A contingent-fee agreement that awards the full twenty-five percent
of past-due benefits or less may therefore be approved under§ 406(b) if the claimant's
attorney demonstrates "that the fee sought is reasonable for the services rendered."
Gisbrecht, 535 U.S. at 807.
In determining reasonableness, the court looks "first to the contingent-fee
agreement, then test[s] it for reasonableness ... based on the character of the
representation and the results the representative achieved." Id. at 808. Although the court
"must give due deference to the intent of the parties," it should not "blindly approve
every fee request made pursuant to a contingent agreement." Wells, 907 F.2d at 372. The
agreed-to fee may be appropriately reduced if the "benefits are large in comparison to the
amount of time counsel spent on the case[.]" Gisbrecht, 535 U.S. at 808; see also Wells,
907 F .2d at 3 72 (holding courts should consider, among other things, "whether the
requested amount is so large as to be a windfall to the attorney"). "Should the district
court find that the agreement provides an unreasonable fee under the circumstances, the
court may reduce the fee provided it states the reasons for and the amounts of the
deductions." Wells, 907 F.2d at 372.
Applying these principles to the record before the court, the contingent-fee
agreement Plaintiff signed provides for the maximum permissible fee award oftwentyfive percent of past-due benefits, and Plaintiff's attorney requests the full twenty-five
percent contingency fee in the amount of$22,379.00. This results in a de facto hourly
billing rate for Plaintiff's counsel of $925.23 per hour, more than twice Plaintiff's
attorney's normal billing rate of $350.00 per hour. See Gisbrecht, 535 U.S. at 808
(holding the requesting attorney's "record of the hours spent representing the claimant
and a statement of [his or her] normal hourly billing charge for noncontingent-fee cases"
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may serve "as an aid to the court's assessment of the reasonableness of the fee yielded by
the fee agreement").
The issues raised before this court were not particularly complex. Attorney
Jackson's time records reveal that the majority of his hours pertained to reviewing and
editing the work of his paralegal, who reviewed the administrative record and researched
and drafted a fourteen-page motion to reverse the decision of the Commissioner. There is
no evidence that the paralegal' s time resulted in a duplication of efforts and it may have,
instead, reduced the number of attorney's hours required. Although substantial for a
single motion, the court does not find the overall hours incurred excessive.
Plaintiffs attorney accepted the risks of representation and the court does not
question the quality of his work. See Wells, 907 F.2d at 371 (recognizing "a contingency
agreement is the freely negotiated expression both of a claimant's willingness to pay
more than a particular hourly rate to secure effective representation, and of an attorney's
willingness to take the case despite the risk of nonpayment"). According to the 2020
Fiscal Year Congressional Justification from the SSA, Social Security claimants in
district courts have approximately a fifty percent likelihood of success on their motions to
reverse. 1
Plaintiffs attorney requested two extensions of deadlines but did not materially
delay the proceedings. His advocacy on behalf of his client was persuasive. See Josyln v.

Barnhart, 389 F. Supp. 2d 454, 456-57 (W.D.N.Y. 2005) (considering in determining
reasonableness of fee "whether the attorney's efforts were particularly successful" and
"whether there is evidence of the effort expended by the attorney demonstrated through
pleadings which were not boilerplate and through arguments which involved both real
issues of material fact and required legal research"). In part, because of her attorney's
efforts, Plaintiff recovered an award of$89,516.00 in past-due benefits. This is a
significant victory that should be reflected in any fee award. In addition, the
See SOCIAL SECURITY ADMINISTRATION, OFFICE OF DISABILITY PROGRAM MANAGEMENT
INFORMATION, FY 2020 CONGRESSIONAL JUSTIFICATION 174 (Jan. 15, 2019),
https ://www.ssa.gov/budget/FY20Files/FY20-JEA C_ 2. pdf.
I

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Commissioner concedes that there is "no evidence of fraud or overreaching" and the
court so finds. (Doc. 32 at 4.)
Based upon the foregoing, the court concludes that while the number of hours
incurred is reasonable, an hourly billing rate in excess of twice the attorney's normal
billing rate and approaching $1,000.00 an hour is unreasonable for the limited, albeit
successful, work performed. In light of these considerations, the court reduces the
attorney's fee award to a de facto hourly billing rate of$500.00, which is in excess with
the average rate charged by experienced attorneys in Vermont, 2 and in excess of Attorney
Jackson's normal billing rate. This fee satisfies the underlying objective of "assist[ing]
social security claimants to obtain effective representation[,]" Wells, 907 F .2d at 3 71,
recognizes Plaintiffs counsel's efforts on his client's behalf, credits the contingent nature
of the attorney's fee agreement, and ensures that the fee award is not unjust or
unreasonable for the work performed.
CONCLUSION
For the foregoing reasons, the court GRANTS IN PART AND DENIES IN PART
Plaintiffs application for attorney's fees pursuant to 42 U.S.C. § 406(b). (Doc. 30.) The
court finds a reasonable attorney's fee award is $13,534.25 comprised of the following:
$10,400.00 attorney's fees and $3,134.25 paralegal fees. In paying the award, the
Commissioner is hereby ORDERED to reflect the $6,950.00 in EAJA fees previously
awarded. See Josyln, 389 F. Supp. 2d at 457 ("[I]fan award for attorney's fees is ordered
both pursuant to the EAJA and pursuant to 42 U.S.C. § 406(b)(l), the lesser of the two
awards must be returned to the claimant."). The remaining amount withheld shall be paid
2

See, e.g., Jennifer W v. Comm 'r ofSoc. Sec., 2020 WL 13608038, at *4 (D. Vt. Oct. 8, 2020)
(concluding effective hourly rate of $222.22 was reasonable); Jose C. v. Comm 'r ofSoc. Sec.,
2019 WL 2950074, at *3 (D. Vt. July 9, 2019) (finding fee award of$255.86/hour was
"reasonable" and "not so large as to constitute a windfall"); Tamara B. v. Berryhill, 2018 WL
3085200, at *4 (D. Vt. June 22, 2018) (determining "an effective 32% premium" above
counsel's hourly rate was "reasonable" and "adequate compensation for the risk he bore in
undertaking representation of the Plaintiff'); see also Rivera v. Berryhill, 2018 WL 2436942, at
*2-3 (E.D.N.Y. May 30, 2018) (reducing fee award from $34,547.25 for 39.5 hours worked
($874.61/hour) to $19,750.00 ($500.00/hour), which was "more than double" the attorney's
hourly rate).
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to Plaintiff.
SO ORDERED.
Dated at Burlington, in the District of Vermont, this / 111'--day of February, 2023.

C · ma eiss, District u ge
United States District Court

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