United States District Court, E.D. Michigan, Southern Division
LOUISE M. CHOATE, Plaintiff,
v.
CAROLYN W. COLVIN, Defendant.
OPINION & ORDER GRANTING MOTION FOR ATTORNEY FEES
(DKT. 26)
MARK
A. GOLDSMITH UNITED STATES DISTRICT JUDGE.
This
matter is before the Court on Plaintiff’s motion for an
award of attorney fees (Dkt. 26). On March 15, 2018, the
Court entered an Order adopting the magistrate judge’s
report and recommendation and entered a judgment granting
Plaintiff’s motion for summary judgment, denying the
Commissioner’s motion for summary judgment, and
remanding the case under sentence four for further
consideration (Dkts. 21-22). Plaintiff was subsequently
awarded $8, 161.35 under Equal Access to Justice Act
(“EAJA”), 28 U.S.C. § 2412 (Dkt. 25). On
remand, Plaintiff was awarded past-due benefits of which $12,
760.75, or 25% of the total award, was withheld as potential
attorney fees under 42 U.S.C. § 403(b). See
Not. of Award at 4 (Dkt. 26-2). Per a contingency fee
agreement between Plaintiff and her attorneys,
Plaintiff’s attorneys filed the present motion seeking
25% of Plaintiff’s award less the amount they received
under the EAJA, for a total of $4, 599.40 in attorney fees.
Mot. ¶¶ 5-9. The Commissioner takes issue with the
procedure for releasing the funds to Plaintiff’s
attorneys, but not the amount. Resp. at 2 (Dkt. 21).
Plaintiff’s counsel filed a reply brief clarifying a
point that is not dispute in this motion (Dkt. 28). For the
reasons discussed below, the motion is granted.
There
are two statutes under which a plaintiff may recover attorney
fees in a Social Security disability case. First, under the
EAJA, a plaintiff may recover attorney fees paid by the
Government. See 28 U.S.C. § 2412. Second, as
part of the judgment in plaintiff’s favor, a court may
award a reasonable fee for an attorney’s representation
paid out of a plaintiff’s past-due benefits.
See 42 U.S.C. § 406(b). The fee awarded under
§ 406(b) may not exceed 25% of the total past-due
benefits. 42 U.S.C. § 406(b)(1)(A); Lasley v.
Comm’r of Soc. Sec., 771 F.3d 308, 309 (6th Cir.
2014). If fees are awarded under both the EAJA and §
406(b), counsel must refund the smaller amount to the
plaintiff. Gisbrecht v. Barnhart, 535 U.S. 789, 796
(2002).
Plaintiff’s
attorneys seek $4, 599.40 from the withheld fees, presumably
with the understanding that the remaining amount would be
released to Plaintiff. Because Plaintiff’s attorneys
have already received $8, 161.35 under the EAJA, this is a
perfectly sensible request. The Commissioner objects and asks
the Court to order the EAJA fee be surrendered to Plaintiff,
as the smaller award, and the full $12, 760.75 be awarded to
Plaintiff’s attorneys. The Commissioner’s reading
of Gisbrecht, and PL 99–80 (HR 2378), PL
99–80, August 5, 1985, 99 Stat 183, is not entirely
persuasive, especially because it creates needless steps to
receive the attorney fees. Nonetheless, to avoid any
potential procedural impediments in the agency, the
Commissioner’s proposed procedures will be followed.
Even
though the Commissioner does not object to the amount of the
fee request, the Court has an independent duty to ensure the
fee award is reasonable. Fees under 42 U.S.C. § 406(b)
are paid from the claimant’s past due benefits. Section
406(b) attorney fees are awarded to a claimant who succeeds
on her Social Security appeal, not to exceed 25% of the total
past-due benefits to which the claimant is entitled:
(b) Fees for representation before court
(1) (A) Whenever a court renders a judgment favorable to a
claimant under [42 U.S.C. § 401 et seq.] 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, and the Commissioner of
Social Security may, notwithstanding the provisions of
section 405(i) of this title, but subject to subsection (d)
of this section, certify the amount of such fee for payment
to such attorney out of, and not in addition to, the amount
of such past-due benefits. In case of any such judgment, no
other fee may be payable or certified for payment for such
representation except as provided in this paragraph.
42 U.S.C. § 406(b)(1)(A). The Supreme Court has
explained, “§ 406(b) does not displace
contingent-fee agreements as the primary means by which fees
are set for successfully representing Social Security
benefits claimants in court. Rather, § 406(b) calls for
court review of such arrangements as an independent check, to
assure that they yield reasonable results in particular
cases.” Gisbrecht, 535 U.S. at 807 (footnote
omitted).
The
Sixth Circuit has explained that a court should use the 25%
cap as a benchmark for evaluating the reasonableness of
attorney fees, although a 25% attorney fee award is not per
se reasonable. Rodriquez v. Bowen, 865 F.2d 739, 746
(6th Cir. 1989) (en banc). Courts must look to the executed
fee agreement and give deference to the expression of the
parties’ intentions. Id. There is a
“rebuttable presumption that an attorney would receive
the full 25% contingency fee under contract unless 1) the
attorney engaged in improper conduct or was ineffective, or
2) the attorney would enjoy an undeserved windfall due to the
client’s large back pay award or the attorney’s
relatively minimal effort.” Hayes v. Sec’y of
Health & Hum. Servs., 923 F.2d 418, 419 (6th Cir.
1990) (citing Rodriquez, 865 F.2d at 746).
No one
has challenged that presumption, and there is no basis for
reducing the requested amount. There are no allegations or
indications of improper conduct or substandard performance by
counsel; Plaintiff’s counsel secured a past-due
benefits award of more than $36, 000. Nor is there any
indication that Plaintiff’s attorney caused any delay
in this matter.
Further,
awarding attorney fees in the requested amount of $12, 760.75
would not result in an undeserved windfall. Nor would
awarding $12, 760.75 in attorney fees “unduly
erode” Plaintiff’s past-due benefit award.
Royzer v. Sec’y of Health & Hum. Servs.,
900 F.2d 981, 982 (6th Cir. 1990). According to
Plaintiff’s attorneys’ motion, they spent 41.45
hours on this civil litigation. Mot. ¶ 6. The requested
fee is reasonable based on the time spent and the results
achieved. See, e.g., Castaneda v. Comm’r
of Soc. Sec., No. 2:10-CV-13724, 2013 WL 2285448, at *3
(E.D. Mich. May 23, 2013) (awarding attorney fees in the
amount of $15, 910.00 out of a total past-due benefit amount
of $63, 640.00).
Plaintiff’s
motion for attorney fees (Dkt. 26) is granted. The
Commissioner of Social Security must pay Plaintiff’s
attorneys $12, 760.75, the full amount withheld, and
Plaintiff’s ...