United States District Court, W.D. Michigan, Southern Division
Janet T. Neff Judge.
REPORT AND RECOMMENDATION
KENT United States Magistrate Judge.
matter is before the Court on plaintiff's motion for an
award of attorney fees pursuant to 42 U.S.C. § 406(b).
(ECF No. 24). Defendant opposes the motion. For the reasons
discussed below, the motion should be granted in part.
claimant and original plaintiff, Michelle Lyn Sindell, filed
this action appealing the Commissioner's decision denying
her benefits. See Compl. (ECF No. 1). Ms. Sindell
passed away during the pendency of this action and her
husband, Ian Sindell, was substituted in as plaintiff.
See Order (ECF No. 26). Attorney Gennel
Laluna-Shaeffer (“Schaeffer”) represented both
Ms. Sindell and Mr. Sindell as plaintiff in the federal court
action. On August 8, 2017, the Court reversed and remanded
the Commissioner's decision pursuant to sentence four of
42 U.S.C. § 405(g). See Opinion and Judgment
(ECF Nos. 27 and 28). Plaintiff's counsel did not apply
for an attorney's fee under the Equal Access to Justice
Act, 28 U.S.C. § 2412 (“EAJA”).
remand, attorney Steven T. Parkman represented the plaintiff,
Ian Sindell (on behalf of (“O/B/O”) Michelle
Sindell) in the administrative proceedings. See
Parkman Aff. (ECF No. 32-4). Ultimately, the Social Security
Administration (SSA) awarded benefits to Ian Sindell O/B/O
Michelle Sindell. On August 1, 2018, Ian Sindell received a
letter from the SSA entitled “Important
Information” (ECF No. 32-2), which the parties have
treated as the “Notice of Award”
(“Notice”). The Notice awarded Ian Sindell $39,
300.00 for past due benefits. Id. at PageID.884. The
Notice stated that “[u]nder the fee agreement, the
lawyer cannot charge you more than $6, 000.00 for his or her
work” and advised Ian Sindell that:
Based on the law, we must withhold part of past-due benefits
to pay an appointed representative. We cannot withhold more
than 25 percent of the past-due benefits to pay an authorized
fee. We withheld $6, 000.00 from Michell [sic] Sindell's
past-due benefits to pay her representative [Attorney
Id. at PageID.884-885. Finally, the Notice stated
that Ian Sindell would soon receive a payment of $33, 264.00
“because we owed money to Michelle Sindell.”
Id. at PageID.886.
letter to the SSA dated August 8, 2018, Attorney Parkman
objected to the attorney fee withheld, stating that while $6,
000.00 was withheld for Section 406(a) fees for work
performed in the administrative proceedings, “nothing
was held for Section 406(b) fees” for work performed in
the federal court. Parkman Letter (ECF No. 32-3). Attorney
Parkman also stated that based on the past due benefits award
of $39, 300.00, “$9, 825.00 should have been withheld
pending order of the Court.” Id. at
Schaeffer had a contingent fee agreement which set forth a
fee of 25% of the past-due benefits, which in this case would
be $9, 825.00. See Laluna-Schaeffer Aff. (ECF No.
32-6). In the “Federal Court Fee Contract, ”
which was dated December 8, 2016, Michelle Sindell agreed in
pertinent part that:
I understand that the Social Security Administration is
supposed to hold out 25% of the past-due benefits and pay the
approved fee to my attorney. If for any reason the SSA fails
to withhold money from my past-due benefits for direct
payment of the fee to my attorney, I promise to pay my
attorney from the past-due benefits I receive.
Contract (ECF No.32-5, PageID.893). However, the contract
also limited the total attorney fee award for work done
before both tribunals (i.e., the SSA and the federal court)
In no case will the fee that comes out of the back benefits
paid on my account be greater than 25% of back benefits
(including the fee paid for work on my case before the Social
Id. In other words, the total fee of all attorneys
working for Ms. Sindell could not exceed 25% of the past-due