Hutter v. Colvin
Filing
23
DECISION AND ORDER signed by Magistrate Judge Nancy Joseph on 4/2/2019 Approving 19 an Award of Attorney's Fees Pursuant to 42 U.S.C. § 406(b). (cc: all counsel) (llc)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF WISCONSIN
BRIAN A. HUTTER,
Plaintiff,
v.
Case No. 15-CV-1296
NANCY BERRYHILL,
Acting Commissioner of Social Security,
Defendant.
DECISION AND ORDER APPROVING AN AWARD OF ATTORNEY’S FEES
PURSUANT TO 42 U.S.C. § 406(b)
On April 11, 2017, I reversed the Social Security Commissioner’s decision denying Brian A.
Hutter’s application for Disability Insurance benefits (“DIB”) and Supplemental Security Income
benefits (“SSI”) and remanded the case for further proceedings. (Docket # 15.) I then awarded
plaintiff’s counsel $5,404.63 in fees under the Equal Access to Justice Act (“EAJA”), 28 U.S.C. §
2412. (Docket # 18.) Following further administrative proceedings, the Commissioner found Hutter
disabled as of August 1, 2009 and awarded Hutter $109,806.00 in past-due benefits. The Social
Security Administration informed Hutter that it was withholding $27,451.50, which represents
twenty-five percent of Hutter’s past-due benefits, for the purpose of paying attorney’s fees approved
by the Court. (Docket # 19-5 at 8–9.) Hutter was also informed that if he had received SSI between
January 2010 and January 2019, the Administration may have to reduce his disability benefits for
that period of time. (Id. at 7.)
Hutter’s counsel originally sought approval pursuant to 42 U.S.C. § 406(b) of fees in the
amount of $27,451.50. (Docket # 19.) The Commissioner opposed the motion, principally on the
ground that Hutter’s past-due DIB benefits will be reduced by the $30,500.92 he previously received
in SSI benefits due to the windfall offset provisions of the Social Security Act. (Docket # 21.) Thus,
the Commissioner contended that Hutter’s counsel should receive $19,826.27, representing 25% of
the past-due DIB benefits after accounting for the SSI offset ($109,806.00 – $30,500.92 = $79,305.08.
Twenty-five percent of $79,305.08 is $19,826.27). Upon reviewing the Commissioner’s response,
Hutter’s counsel agreed that Hutter’s past-due benefits only include the amount payable to Hutter
following an offset of awarded benefits and thus amended his motion and requested fees in the
amount of $19,826.27. (Docket # 22.) Hutter’s counsel now seeks approval pursuant to 42 U.S.C.
§ 406(b) of fees in the amount of $19,826.27 under his contingency fee agreement with the plaintiff.
(Docket # 22.)
An attorney who succeeds in obtaining benefits for a social security claimant may recover fees
pursuant to 42 U.S.C. § 406. Section 406(a) governs fees for representation in administrative
proceedings before the Social Security Administration (“SSA”); § 406(b) controls fees for
representation in federal court. Kopulos v. Barnhart, 318 F. Supp. 2d 657, 660 (N.D. Ill. 2004) (citing
Gisbrecht v. Barnhart, 535 U.S. 789, 794 (2002)). The statute provides for a “reasonable fee” not to
exceed twenty-five percent of the past-due benefits awarded to the claimant. Id. at 661. Such fees are
deducted from the claimant’s retroactive benefits; they do not constitute an award against the
government. Id.
If the attorney previously obtained fees from the government under the EAJA for work
performed in court, such award offsets the allowable fee under § 406(b). Id. at 664; see also Hanrahan
v. Shalala, 831 F. Supp. 1440, 1452 (E.D. Wis. 1993) (stating that “when attorney’s fees are awarded
under both the SSA and the EAJA for the same services, an attorney is entitled to keep the larger fee
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but must return the smaller fee to the claimant”). Further, pursuant to 42 U.S.C. § 1320a-6(a), the
Commissioner must reduce a beneficiary’s past-due DIB benefits by the amount of SSI received for
the same period of time, but which he would not have been eligible to receive had he been paid DIB
benefits on time for each month of entitlement. This is commonly known as the windfall offset
provision of the Act.
The court must approve any fee under § 406(b). Congress intended such review not to override
the claimant and counsel’s fee arrangement but rather to act as an “independent check” to ensure that
the arrangement yielded a reasonable result in the particular case. Gisbrecht, 535 U.S. at 807.
“Congress has provided one boundary line: Agreements are unenforceable to the extent that they
provide for fees exceeding 25 percent of the past-due benefits.” Id. Within the twenty-five percent
boundary, the attorney for the successful claimant must show that the fee sought is reasonable for the
services rendered. Id. In making this determination, the court may consider the character of the
representation and the results obtained, reducing an award if the attorney is responsible for delay in
the proceeding that had the effect of inflating past-due benefits, or if the fee is so large in comparison
to the amount of time counsel spent on the case that the fee would constitute a windfall to the
attorney. Id. at 808.
In this case, plaintiff entered into a twenty-five percent contingency fee agreement with
counsel. (Docket # 19-5 at 2.) Twenty-five percent of Hutter’s past due benefits (reduced by the
windfall offset of $30,500.92) is $19,826.27. (Docket # 21 at 9, Docket # 22.) Counsel previously
received $5,404.63 under the EAJA. Counsel seeks an award of $19,826.27, consistent with his
twenty-five percent contingency fee agreement and a reduction for the windfall offset amount, and
states that he will remit the previously awarded EAJA fee of $5,404.63 directly to Hutter. (Docket
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# 19-2 at 3.) Thus, counsel has met the “one boundary line” of requesting a fee that does not exceed
twenty-five percent of the past-due benefits.
However, within the twenty-five percent boundary, counsel must still show that the fee sought
is reasonable. Counsel contends that the requested fee is reasonable given the fact he achieved success
in reversing the Commissioner’s decision and obtaining benefits for Hutter, despite requiring multiple
hearings and appeals. (Docket # 19-2 at 3.) Counsel states that he works almost exclusively on Social
Security disability cases, both at the administrative and federal court levels. (Id.)
Pursuant to Gisbrecht, I find the requested fee is reasonable. As noted above, counsel has
obtained a fully favorable result and the fee does not constitute a windfall to the attorney. The
amount sought by counsel under § 406(b) is within the 25% permitted by law and provided for in the
fee agreement. The fee of $19,826.27 for 29.2 hours of work (Docket # 19-5) equates to an hourly
fee of approximately $679/hour. Although a rate of $679/hour is significantly higher than rates I
have approved in the past, see, e.g., Garcia v. Colvin, No. 14-CV-415, 2016 WL 3189218 (E.D. Wis.
June 7, 2016) (approving fee of approximately $228/hour); Buhk v. Colvin, No. 12-CV-615, 2015 WL
1509242 (E.D. Wis. Apr. 1, 2015) (approving fee of approximately $348/hour); Berry v. Colvin, No.
12-CV-1090, 2015 WL 225441 (E.D. Wis. Jan. 16, 2015) (approving fee of approximately
$330/hour); Felske v. Colvin, No. 11-CV-591, 2013 WL 1498990 (E.D. Wis. Apr. 11, 2013) (approving
fee of approximately $350/hour), it is still within the realm of reasonable fees approved by the courts
in this circuit, see Guy v. Colvin, No. 13-CV-178, 2016 WL 447613, at *2 (E.D. Wis. Feb. 4, 2016)
(approving fee rate of $1,292.15/hour); Kolp v. Colvin, No. 12-CV-842, 2015 WL 4623645 (E.D. Wis.
Aug. 3, 2015) (approving fee rate of $1,118.44/hour); Stemper v. Astrue, No. 04-CV-838, 2008 WL
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2810589, at *1 (W.D. Wis. July 14, 2008) (approving rate hourly rate of $666/hour); Koester v. Astrue,
482 F. Supp. 2d 1078, 1081 (E.D. Wis. 2007) (approving hourly rate of $580.67/hour).
NOW, THEREFORE, IT IS HEREBY ORDERED that plaintiff’s motion for an award of
attorney’s fees pursuant to 42 U.S.C. § 406(b) is hereby GRANTED. Attorney Charles E. Binder is
awarded fees in the amount of $19,826.27.
IT IS FURTHER ORDERED that upon receipt of this sum, Attorney Binder is directed to
refund $5,404.63, representing fees that were previously awarded under the EAJA, directly to Hutter.
Dated at Milwaukee, Wisconsin this 2nd day of April, 2019.
BY THE COURT:
s/Nancy Joseph
NANCY JOSEPH
United States Magistrate Judge
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