United States District Court, D. New Mexico
ORDER GRANTING MOTION FOR ATTORNEY FEES
KHALSA, United States Magistrate Judge Presiding by Consent.
MATTER comes before the Court on Plaintiff's Motion for
Order Authorizing Attorney Fees Pursuant to 42 U.S.C. §
406(B) and Supporting Memorandum (“Motion”),
filed December 8, 2016. (Doc. 34.) The Commissioner filed a
Response on December 14, 2016, and stated that although it is
not a party to § 406(b) fee awards and generally takes
no position on such petitions, it has no objection to
Plaintiff's Motion. (Doc. 35.) Having considered the
Plaintiff's Motion, the Commissioner's Response, and
the relevant law, the Court finds Plaintiff's Motion is
well taken and is GRANTED.
Lopez instituted an action in this Court seeking judicial
review of his denied claims for disability and supplemental
security income benefits. The Court concluded that the
Administrative Law Judge (“ALJ”) had failed to
apply the correct legal standards, and the matter was
remanded to the Social Security Administration
(“SSA”) for rehearing. Mr. Lopez subsequently
filed an opposed motion for attorneys' fees under the
Equal Access to Justice Act (“EAJA”), which the
Court granted, and he was awarded $5, 785.00 in attorney
fees. (Doc. 33.)
remand, the ALJ issued a fully favorable decision dated June
29, 2016, finding that Mr. Lopez has been disabled since May
17, 2011. (Doc. 34 at Ex. A.) A Notice of Award was
subsequently sent to Mr. Lopez on September 4, 2016, stating
that the SSA had withheld $17, 911.50 to cover Mr.
Lopez's attorney fees. (Doc. 34 at Ex. B.) Mr. Lopez
noted that the SSA awarded his counsel a fee of $6, 000,
which reflected the fee contract he entered into with counsel
for work performed before the Administration. (Doc. 37 at Ex.
B.) However, he entered into a separate contingency fee
contract for legal services in the United States District
Court, and he now seeks an order authorizing fees pursuant to
42 U.S.C. § 406(b) in the amount of $11, 911.50 for the
work his counsel performed before this Court (Id.)
fees may be deducted from a successful social security
claimant's award of past-due benefits. Separate
subsections of 42 U.S.C. § 406 authorize fee awards for
representation before the SSA and in court, allowing
attorneys to receive fees for their work in both settings.
See 42 U.S.C. § 406(a), (b).
representation before the SSA, the statute permits an
attorney to file a fee petition or a fee agreement with the
agency “whenever the Commissioner . . . makes a
determination favorable to the claimant . . . .” 42
U.S.C. § 406(a). There is no express limit to the fees
an attorney may seek and receive in a petition; the
Commissioner must only “fix . . . a reasonable fee,
” id., while considering several factors.
See 20 C.F.R. § 404.1725(b) (2015) (outlining
the factors); see also Gisbrecht, 535 U.S. at 794
(explaining the fee petition process). For fees received
pursuant to a fee agreement for work before the SSA,
attorneys may currently receive a maximum award of the lesser
of $6, 000 or 25% of the past-due benefits. 42 U.S.C. §
representation in court, courts may award fees under §
406(b) when, as in this case, “the court remands a . .
. case for further proceedings and the Commissioner
ultimately determines that the claimant is entitled to an
award of past-due benefits.” McGraw v.
Barnhart, 450 F.3d 493, 496 (10th Cir. 2006).
The statute limits a fee award for representation before a
court to 25% of the claimant's past-due benefits. 42
U.S.C. § 402(a)(1)(A). Separate awards of attorney fees
for representation before the SSA and in court - for example,
fees pursuant to the EAJA and § 406(b) - are not limited
to an aggregate of 25% of past-due benefits. Wrenn v.
Astrue, 525 F.3d 931, 936-38 (10th Cir.
2008). However, if fees are awarded under both EAJA and
§ 406(b), the attorney must refund the lesser award to
the claimant. McGraw, 450 F.3d at 497 N.2
(10th Cir. 2006).
§ 406(b) permits contingency fee agreements, it requires
the reviewing court to act as “an independent
check” to ensure that fees awarded pursuant to such
agreements are reasonable. Gisbrecht, 535 U.S. at
807. Fee agreements are flatly unenforceable to the extent
that they provide for fees exceeding 25% of past-due
benefits, but fees may be unreasonable even if they fall
below this number, and there is no presumption that fees
equating to 25% of past-due benefits are reasonable.
Id. at 807 n.17. The attorney seeking fees bears the
burden of demonstrating the reasonableness of the fee.
Id. at 807.
reasonableness determination is “based on the character
of the representation and the results the representative
achieved.” Id. at 808. If the attorney is
responsible for delay, the fee may be reduced so that the
attorney does not profit from the accumulation of benefits
while the case was pending in court. Id. Such a
reduction also protects the claimant, as fees paid under
§ 406(b) are taken from, and not in addition to, the
total of past-due benefits. 42 U.S.C. § 406(b)(1)(A).
The fee may also be reduced if the benefits are large in
comparison to the amount of time spent on the case.
Gisbrecht, 535 U.S. at 808. A court may require the
claimant's attorney to submit a record of the hours spent
representing the claimant and a statement of the lawyer's
normal hourly billing rate for noncontingent-fee cases.
statute does not contain a time limit for fee requests.
However, the Tenth Circuit has held that a request
“should be filed within a reasonable time of the
Commissioner's decision awarding benefits.”
McGraw, 450 F.3d t 505 (citation omitted).
Lopez's counsel's fee request is reasonable. First,
Mr. Lopez's counsel filed the fee request within a
reasonable time. Second, the fee agreement entered into
between Mr. Lopez and the Michael Armstrong Law Firm entitles
it to no more than 25% of all past-due benefits, and the fees
sought do not exceed the amount agreed to and permitted.
(Doc. 34 at Ex. D.) Third, there is no evidence that counsel
delayed in the proceedings before this Court. Fourth,
counsel's representation was more than adequate and
yielded a fully favorable decision. (Doc. 34 at Ex. E.) Last,
counsel's fee request of $11, 911.50 is not
disproportionately large in comparison to the amount of time
spent on the case (30.75 hours or $387.37 per hour), and is
in line with other awards authorized in this District under
406(b). See e.g., Newman v. Colvin, USDC NM Civ. No.
13-914 LH/KK (Doc. 40) (awarding $10, 408.00 for 34.84 hours
or $298.74 per hour); Recio v. Colvin, USDC NM Civ.
No. 13-828 WPL (Doc. 28) (awarding $9, 968.00 for 30.75 hours
or $324.16 per hour); Martinez v. Colvin, USDC NM
Civ. 12-1181 ...