McNaught, Richard v. Colvin, Carolyn
ORDER granting in part and denying in part 21 Motion for Attorney Fees. Plaintiff's attorney awarded attorney fees in the amount of $7,330. The remaining portion of the statutory fee ($10,881.25) shall be released to plaintiff. Signed by District Judge Barbara B. Crabb on 10/12/17. (jat) Modified on 10/12/2017 (jat).
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF WISCONSIN
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - RICHARD MCNAUGHT,
OPINION and ORDER
NANCY A. BERRYHILL, Acting
Commissioner of Social Security,
- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - Plaintiff Richard McNaught filed this lawsuit in 2015, seeking review of an
administrative decision denying his request for disability benefits under the Social Security
Act. After plaintiff filed a motion for summary judgment, the parties agreed to a remand for
further proceedings before the administrative law judge. After I granted the motion to
remand, the parties stipulated to an award under the Equal Access to Justice Act of
$4,400.00 in attorney fees for plaintiff’s attorney, Dana Duncan, for the proceedings up
until that time. Dkt. ##13 and 18. On remand, an administrative law judge concluded that
plaintiff was disabled and entitled to past-due benefits of $72,845.00.
Now Duncan seeks an award of attorney fees under 42 U.S.C. § 406(b) and the
contingency agreement signed by plaintiff. Dkt. #21. Duncan says that he is entitled to
$18,211.25, which is 25 percent of plaintiff’s past-due benefits award of $72,845.00.
However, because he has already received $4,400 under the Equal Access to Justice Act,
Duncan requests that he be paid $13,211.25 out of plaintiff’s past-due benefits and that the
remaining $4,400.00 withheld by the Commissioner be released to plaintiff.
commissioner does not oppose Duncan’s request. For the reasons below, I am awarding
Duncan $11,730 in total attorney fees, meaning that he may retain the $4,400 EAJA award
and may receive $7,330 in fees from plaintiff’s past due benefits. The remaining portion of
the statutory fee withheld by the Commissioner ($10,881.25) shall be released to plaintiff.
Under 42 U.S.C. § 406(b), the court may award a prevailing plaintiff’s attorney a
reasonable fee, but no greater than 25 percent of past-due benefits. Gisbrecht v. Barnhart,
535 U.S. 789, 792 (2002). See also McGuire v. Sullivan, 873 F.2d 974, 980 (7th Cir.
1989) (“A court may award a fee up to that provided in the [contingency-fee] contract so
long as the court has reviewed its reasonableness.”). When evaluating a request for fees
under § 406(b) for reasonableness, a court may consider "the character of the representation
and the results the representative achieved.” Gisbrecht, 535 U.S. at 808. In Gisbrecht, the
Court identified two instances in which a fee reduction would be appropriate. First, “[i]f the
attorney is responsible for delay, . . . a reduction is in order so that the attorney will not
profit from the accumulation of benefits during the pendency of the case in court.” Id.
Second, if the benefits are large in comparison to the amount of time counsel spent on the
case, a downward adjustment is similarly in order. Id. Courts in this circuit have considered
factors such as the attorney’s experience, reputation and ability as well as awards in similar
cases. Westlund v. Berryhill, No. 15-cv-450-jdp, 2017 WL 2389724, at *1 (W.D. Wis. June
1, 2017) (citing Hodges-Williams v. Barnhart, 400 F. Supp. 2d 1093, 1099 (N.D. Ill. 2005),
and McGuire, 873 F.2d at 979, 983)).
As an initial matter, I note that Duncan includes time spent in the administrative
proceedings in his fee requests. As has been explained to him repeatedly, § 406(b) applies
only to attorney fees related to court proceedings. E.g, Beach v. Berryhill, No. 14-cv-857bbc, 2017 WL 3275546, *2 (W.D. Wis. Aug. 1, 2017) (“It is unclear why, nine years after
this court held otherwise, Duncan continues to try to use § 406(b) to obtain fees for time
spent in administrative proceedings.”); Heise v. Colvin, No. 14-cv-739-jdp, 2016 WL
7266741, at *2 (W.D. Wis. Dec. 15, 2016) (Peterson, J.) (“[U]nder § 406 each tribunal may
award fees only for the work done before it[,] . . . [s]o I will limit my reasonableness
evaluation to Duncan's work before this court, and he can pursue the rest of his contingency
fee from the Commissioner.”) (citations and internal quotations omitted); Stemper v. Astrue,
No. 04-cv-838-jcs, 2008 WL 2810589, at *1 (W.D. Wis. July 14, 2008) (Crabb, J.) (“§
406(b) governs fees for representation in court and not in the administrative proceedings.”).
Accordingly, I am disregarding Duncan’s records and arguments relating to time spent at the
Duncan’s records show that he spent 16.60 hours on matters related to court
proceedings, including the preparation of a motion for summary judgment, and his paralegal
spent another 17.15 hours on those matters. Dkt. #21-4. Although it appears to be an
open question in this circuit whether paralegal time may be considered in assessing the
reasonableness of a fee request under § 406(b), I see no reason to exclude it. Richlin
Secretary Service Co. v. Chertoff, 553 U.S. 571, 581 (2008) (reasonable attorney fees under
Equal Access to Justice Act includes paralegal time); Missouri v. Jenkins, 491 U.S. 274, 285
(1989) (reasonable attorney fees under 42 U.S.C. § 1988 include paralegal time). Awarding
Duncan $18,211.25 for this combined time would be the equivalent of a rate of
approximately $850 an hour for Duncan and $250 an hour for his paralegal. This fee is on
the high end of rates that courts have awarded, Koester v. Astrue, 482 F. Supp. 2d 1078,
1081 (E.D. Wis. 2007), so it warrants careful review for reasonableness.
Duncan makes almost no effort to show that something about this case warrants
compensation at a high equivalent hourly rate. He argues that his contingency fee is actually
equivalent to a much lower hourly compensation, either $364.42 or $254.17, but his
calculations include the time he spent at the administrative level and are not helpful. A
review of Duncan’s work in this case shows that the work was routine and does not warrant
the high contingency premium Duncan seeks.
Because the representative fee is
unreasonable, I will reduce it to an appropriate rate.
In setting a reasonable fee, I consider Duncan’s experience, the risk he incurred in
taking a case on a contingency basis and the efficient resolution he achieved after filing a
motion for summary judgment. On the other hand, I consider Duncan’s actions in ignoring
repeatedly the court’s instructions and wasting the court’s resources by attempting to justify
representative fee awards under § 406(b) on the basis of work in tribunals other than this
court. I conclude that a reduced fee equivalent to $500 and hour for Duncan’s 16.60 hours
of work ($8,300), and $200 an hour for the 17.15 hours of paralegal work ($3,430), is
reasonable. Accordingly, I will award Duncan a total fee of $11,730. This means Duncan
may receive $7,330 from the award withheld by the Commissioner and may retain the
previous award of $4,400 in fees under the Equal Access to Justice Act.
IT IS ORDERED that Dana Duncan’s motion for attorney fees, dkt. #21, is
GRANTED IN PART AND DENIED IN PART. Duncan is awarded $7,330 in fees under
42 U.S.C.§ 406(b) to be paid out of plaintiff Richard McNaught’s past due benefits. The
remaining portion of the statutory fee ($10,881.25) shall be released to plaintiff.
Entered this 12th day of October, 2017.
BY THE COURT:
BARBARA B. CRABB
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