Mcenery v. Commissioner Of Social Security

Background

Ana Mercedes Mcenery applied for disability insurance benefits, alleging disability beginning December 30, 2015. An administrative law judge denied her claim, and the Social Security Administration Appeals Council denied her appeal. Mcenery then retained Kenneth Hiller and Justin Goldstein of the Law Offices of Kenneth R. Hiller PLLC to pursue the claim in federal court under a fee agreement providing for 25% of any past-due benefits.

The parties later agreed that the Social Security decision should be reversed and the case sent back to the agency for further proceedings. The court entered that remand order. Mcenery’s counsel also received $6,362.74 in attorney’s fees under the Equal Access to Justice Act for the federal-court work.

After the remand, an administrative law judge issued a fully favorable decision. The Social Security Administration awarded Mcenery $145,210.72 in past-due benefits and withheld $36,302.68 for attorney’s fees. It paid $11,154.67 to Matthew Nutting, who had represented Mcenery at the administrative level, and continued withholding $25,148.01 pending a court order concerning Hiller’s fee request.

Timeliness

Hiller moved for fees under 42 U.S.C. § 406(b), which allows a court to approve a reasonable fee for successful representation in federal court, subject to a limit of 25% of the claimant’s past-due benefits. He filed the motion on April 9, 2024, more than 14 days after the Social Security Administration’s January 15, 2024 Notice of Award was presumably received by Mcenery.

The court explained that the usual 14-day deadline can be extended when circumstances warrant. The Social Security Administration had sent the Notice of Award to Nutting rather than Hiller, so Hiller did not receive notice of the benefits amount until a March 23, 2024 letter. He obtained the Notice of Award and filed the fee motion within 14 days of receiving that information. The court therefore deemed the motion timely. It did not decide whether the filing period should begin when the claimant or the attorney receives notice of the award.

Reasonableness of the Fee

The court began with the contingency-fee agreement and independently reviewed whether the requested amount was reasonable. The requested $24,302.68 was approximately 17% of Mcenery’s past-due benefits, below the statutory 25% limit, and there was no evidence of fraud or overreaching.

The court found that the fee fit the nature and results of the representation. Counsel reviewed a 508-page administrative record, prepared a 25-page legal memorandum, and negotiated the remand that ultimately led to the benefits award. The record did not show that counsel unreasonably delayed the proceedings.

The court also rejected the argument that the fee would be an improper windfall. Counsel spent 27.2 hours on the case, and the resulting effective hourly rate was $893.48. Although that rate exceeded Goldstein’s ordinary non-contingency rate, the court found it reasonable in light of counsel’s experience, efficiency, the uncertainty of success after the earlier denials, and the favorable result.

Equal Access to Justice Act Fees

Because counsel received fees under both the Equal Access to Justice Act and Section 406(b) for the same federal-court work, counsel must refund the smaller fee to Mcenery. Counsel had agreed to refund the $6,362.74 Equal Access to Justice Act award after receiving the Section 406(b) award.

Disposition

The court granted Mcenery’s motion for attorney’s fees and awarded her counsel $24,302.68, to be paid out of her past-due benefits. Upon receiving that award, counsel must promptly refund Mcenery $6,362.74. The court directed the clerk to terminate the pending motion.