(SS) Koury v. Commissioner of Social Security ( 2024 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 ANITA J. KOURY, Case No. 1:20-cv-01417-EPG 11 Plaintiff, ORDER GRANTING MOTION FOR 12 ATTORNEY’S FEES PURSUANT TO 42 13 v. U.S.C. § 406(b) COMMISSIONER OF SOCIAL SECURITY, 14 (ECF No. 26) Defendant. 15 16 On December 1, 2023, Attorney Shellie Lott, counsel for Plaintiff Anita J. Koury, filed a 17 motion for an award of $5,950 in attorney’s fees under 42 U.S.C. § 406(b). (ECF No. 26). 18 Plaintiff and the Commissioner of Social Security were each served with a copy of the motion. 19 (ECF No. 26-6, pp. 1-2). Plaintiff has not filed any response to the motion. On December 26, 20 2023, the Commissioner filed a response providing analysis regarding the fee request but taking 21 no position on its reasonableness. (ECF No. 28). 22 For the reasons set forth below, the motion for an award of attorney’s fees is GRANTED 23 in the amount of $5,950, with counsel reimbursing Plaintiff for $2,216.26 in fees received 24 pursuant to the Equal Access to Justice Act (EAJA), 28 U.S.C. § 2412(d). (See ECF No. 30). 25 I. BACKGROUND 26 Plaintiff filed the complaint in this case on October 5, 2020. (ECF No. 1). The parties 27 consented to this case proceeding before the undersigned. (ECF No. 9). After Plaintiff filed a 28 brief, the parties filed a stipulation for voluntary remand for further proceedings. (ECF Nos. 18, 1 22). And on March 7, 2022, pursuant to the parties’ stipulation, the Court entered an order 2 awarding Plaintiff $2,216.26 in EAJA fees. (ECF No. 25). 3 On remand, the Commissioner calculated Plaintiff’s past-due benefits at $61,395.90 and 4 25%, i.e., $15,348.98, was withheld to pay Plaintiff’s representative. (ECF No. 26, p. 1; see ECF No. 26-2, p. 3). This matter is now before the Court on counsel’s motion, seeking an award of 5 $5,950. (ECF No. 26). 6 II. DISCUSSION 7 Under the Social Security Act, attorneys may seek a reasonable fee for cases in which 8 they have successfully represented social security claimants. Section 406(b) provides: 9 Whenever a court renders a judgment favorable to a claimant under this subchapter 10 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 11 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 . . . 12 certify the amount of such fee for payment to such attorney out of, and not in 13 addition to, the amount of such past-due benefits . . . . 14 42 U.S.C. § 406(b)(1)(A) (emphasis added). “In contrast to fees awarded under fee-shifting provisions such as 42 U.S.C. § 1988, the 15 [§ 406(b)] fee is paid by the claimant out of the past-due benefits awarded; the losing party is not 16 responsible for payment.” Crawford v. Astrue, 586 F.3d 1142, 1147 (9th Cir. 2009) (en banc) 17 (citing Gisbrecht v. Barnhart, 535 U.S. 789, 802 (2002)). Even though the § 406(b) fee award is 18 not paid by the Government, the Commissioner “plays a part in the fee determination resembling 19 that of a trustee for the claimant[].” Gisbrecht, 535 U.S. at 798 n.6. The goal of awarding fees 20 under § 406(b) was to prohibit “exorbitant fees” from being collected by attorneys but also to 21 provide sufficient fee awards “to encourage adequate representation of claimants.” Crawford, 586 22 F.3d at 1149 (internal citations omitted). 23 The 25% maximum fee is not an automatic entitlement, and courts are required to ensure 24 that the requested fee is reasonable. Gisbrecht, 535 U.S. at 808-09 (holding that § 406(b) does not 25 displace contingent-fee agreements within the statutory ceiling; instead, § 406(b) instructs courts 26 to review for reasonableness fees yielded by those agreements). “Within the 25 percent boundary 27 . . . the attorney for the successful claimant must show that the fee sought is reasonable for the 28 1 services rendered.” Id. at 807; see also Crawford, 586 F.3d at 1148 (noting that § 406(b) “does 2 not specify how courts should determine whether a requested fee is reasonable” but “provides 3 only that the fee must not exceed 25% of the past-due benefits awarded”). 4 Generally, “a district court charged with determining a reasonable fee award under § 406(b)(1)(A) must respect ‘the primacy of lawful attorney-client fee arrangements,’ . . . 5 ‘looking first to the contingent-fee agreement, then testing it for reasonableness.’” Crawford, 586 6 F.3d at 1148 (quoting Gisbrecht, 535 U.S. at 808). The United States Supreme Court has 7 identified several factors that may be considered in determining whether a fee award under a 8 contingent-fee agreement is unreasonable and therefore subject to reduction: (1) the character of 9 the representation; (2) the results achieved by the representative; (3) whether the attorney engaged 10 in dilatory conduct in order to increase the accrued amount of past-due benefits; (4) whether the 11 benefits are large in comparison to the amount of time counsel spent on the case; and (5) the 12 attorney’s record of hours worked. Id. (citing Gisbrecht, 535 U.S. at 807-08). 13 Here, the fee agreement in this case provides as follows: 14 This is a contingent fee contract. If Attorney prevails before the Federal Court, 15 and if Claimant is subsequently awarded benefits by the Social Security Administration (“SSA”), Claimant agrees to pay Attorney a fee for Federal Court 16 work equal to 25% of the past-due benefits. 17 (ECF No. 26-3, p. 2). The Court has considered the character of counsel’s representation of Plaintiff and the 18 good results achieved by counsel, which included a voluntary remand for further proceedings and 19 an eventual award of benefits. Counsel represents that 9.1 hours were expended in this matter. 20 (ECF No. 26, p. 2). There is no indication that a reduction is warranted due to any substandard 21 performance by counsel and there is no evidence that counsel engaged in any dilatory conduct 22 resulting in delay. 23 Counsel seeks an award of $5,950, which results in an approximate hourly rate of $654. 24 The Ninth Circuit has found similar and higher effective hourly rates reasonable. See, e.g., 25 Crawford, 586 F.3d at 1153 (explaining that the majority opinion found reasonable effective 26 hourly rates equaling $519, $875, and $902) (J. Clifton, concurring in part and dissenting in part); 27 see also Tamayo v. Kijakazi, No. 1:19-CV-00317-GSA, 2022 WL 16810622, at *2 (E.D. Cal. 28 1 Nov. 8, 2022) (“Moreover, the $710 effective hourly rate sought here is lower than the rates 2 approved by other courts under section 406(b).”); Patterson v. Apfel, 99 F. Supp. 2d 1212, 1214 3 & n.2 (C.D. Cal. 2000) (noting that “a survey of several dozen cases in which attorney’s fees 4 were awarded in social security cases suggests that the 33.75 hours spent by plaintiff’s counsel falls within the approved range,” and collecting cases). Further, the requested attorney fees award 5 of $5,950 does not exceed 25% of past-due benefits and is not excessive in relation to the past- 6 due benefits awarded. See generally Ortega v. Comm’r of Soc. Sec., No. 1:12-cv-01030-AWI- 7 SAB, 2015 WL 5021646, at *3 (E.D. Cal. Aug. 21, 2015) (granting § 406(b) attorney fees in the 8 amount of $24,350.00); Thomas v. Colvin, No. 1:11-cv-01291-SKO, 2015 WL 1529331, at *3 9 (E.D. Cal. Apr. 3, 2015) (granting § 406(b) attorney fees in the amount of $44,603.50); Boyle v. 10 Colvin, No. 1:12-cv-00954-SMS, 2013 WL 6712552, at *2 (E.D. Cal. Dec. 19, 2013) (granting 11 § 406(b) attorney fees in the amount of $20,577.57). 12 In making this determination, the Court recognizes counsel’s assumption of risk in 13 agreeing to represent Plaintiff under a contingency fee agreement. “District courts generally have 14 been deferential to the terms of contingency fee contracts in § 406(b) cases.” Harris v. Barnhart, 15 262 F. Supp. 2d 1033, 1037 (N.D. Cal. 2003). Attorneys who agree to represent claimants 16 pursuant to a contingency fee agreement assume the risk of receiving no compensation for their 17 time and effort if the action does not succeed. Id. Here, counsel accepted substantial risk of loss in 18 representing Plaintiff, whose application had already been denied at the administrative level. 19 Plaintiff agreed to the fee, and counsel secured a remand leading to an award of substantial 20 benefits. 21 An award of attorney fees pursuant to § 406(b) in the amount of $5,950 is thus 22 appropriate. An award of § 406(b) fees, however, must be offset by any prior award of attorney 23 fees granted under the EAJA. See 28 U.S.C. § 2412; Gisbrecht, 535 U.S. at 796. Plaintiff was awarded $2,216.26 in EAJA fees, and counsel agrees to refund these fees. (ECF No. 26, p. 3). 24 III. CONCLUSION AND ORDER 25 For the reasons stated above, the Court finds that the attorney fees sought by Plaintiff’s 26 counsel pursuant to § 406(b) are reasonable. Accordingly, IT IS ORDERED: 27 1. The motion for attorney fees (ECF No. 26) under 42 U.S.C. § 406(b) in the amount of 28 1 | $5,950 is granted. 2 2. Plaintiff’s counsel shall refund Plaintiff $2,216.26 for the EAJA fees previously 3 || awarded pursuant to 28 U.S.C. § 2412(d) upon the receipt of these fees. 4 3. The Clerk of the Court is respectfully directed to serve a copy of this order on Plaintiff 5 Anita J. Koury, 2901 Kingman Court, Modesto, CA 95355. (ECF No. 26-6, p. 2). IT IS SO ORDERED. 4 g | Dated: _January 26, 2024 _ sf ery 9 UNITED STATES MAGISTRATE JUDGE 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28