Irizarry v. Commissioner of Social Security

Background

Daniel Berger represented Judy Irizarry in her action seeking judicial review of the Commissioner of Social Security’s denial of Supplemental Security Income benefits. Their contingency-fee agreement provided that Berger could receive 25% of any past-due benefits awarded to Irizarry, and nothing if she was unsuccessful.

After the administrative record was filed and Irizarry moved for judgment on the pleadings, the parties stipulated to a remand under sentence four of 42 U.S.C. § 405(g) on July 1, 2022. The parties also agreed to $7,328 in attorney’s fees and costs under the Equal Access to Justice Act (EAJA).

Following the remand, the Social Security Administration found Irizarry disabled and awarded her $135,882.72 in past-due benefits. The agency withheld $33,970.68 for a possible attorney-fee award under 42 U.S.C. § 406(b). Berger then moved for that amount. He reported spending 31.6 hours on the federal-court action. The Commissioner deferred to the court’s assessment of whether the requested fee was reasonable.

Legal standard

Section 406(b) allows a court to award a reasonable fee of no more than 25% of a claimant’s past-due benefits. When a contingency-fee agreement falls within that cap and there is no fraud or overreaching, the court evaluates whether the fee is reasonable.

The court considered whether Berger achieved favorable results, caused any unjustified delay, or requested a fee so large compared with the work performed that it would be an improper windfall. In assessing that question, the court also considered Berger’s ability and efficiency, the nature and length of his relationship with Irizarry, Irizarry’s satisfaction with the result, and the uncertainty and effort involved in obtaining benefits.

When fees are awarded under both Section 406(b) and the EAJA, the attorney must refund the claimant the smaller fee—in this case, the EAJA award.

Court’s analysis

The court found the motion timely because Berger filed it nine days after the Social Security Administration’s notice of the benefit award. The requested $33,970.68 did not exceed the 25% statutory cap. The record contained no allegations of fraud or overreaching and did not show purposeful delay by Berger.

The court also found that Berger achieved positive results: the case was remanded by stipulation, and Irizarry later received a six-figure award of past-due benefits. Berger’s 31.6 hours of work were comparable to the hours that other experienced benefits attorneys had spent in similar cases. The court noted Berger’s experience in Social Security disability matters and his representation of Irizarry at the agency level.

Although the effective hourly rate was $1,075.02, the court stated that this rate alone did not determine whether the fee was a windfall. It found that none of the relevant factors supported reducing the requested fee. The court therefore concluded that the full 25% fee was reasonable.

Disposition

The court granted Berger’s motion and awarded him $33,970.68 in attorney’s fees under Section 406(b). The court ordered Berger, within five business days after receiving that award, to refund Irizarry the $7,328 in EAJA fees and file a declaration confirming the refund. The Clerk of Court was directed to close the fee-motion docket entry.