Farrar v. Commissioner of Social Security

Background

Shanise Farrar applied for Social Security Disability and Supplemental Security Income benefits in May 2019, alleging disability beginning June 24, 2018. The Commissioner denied the application. After a hearing, an administrative law judge found Farrar not disabled, and the Appeals Council declined to review that decision.

Farrar retained the Law Offices of Charles E. Binder and Harry J. Binder, LLP, referred to in the opinion as the Binder Firm, to seek judicial review. The retainer agreement provided that, if the case was sent back to the Social Security Administration and Farrar ultimately received past-due benefits, she would pay the firm up to 25% of those benefits.

Farrar filed this action on October 17, 2022. On February 24, 2023, the court approved the parties’ agreement to send the case back to the Commissioner for further proceedings under sentence four of 42 U.S.C. § 405(g). The court later approved an Equal Access to Justice Act, or EAJA, fee award of $7,457.85 for Farrar’s counsel.

After the remand, an administrative law judge issued a fully favorable decision finding Farrar disabled beginning June 24, 2018. The Social Security Administration issued a notice stating that Farrar’s past-due benefits totaled $78,459. The Binder Firm then moved for $19,614.75 in attorney’s fees under § 406(b) of the Social Security Act, which equals 25% of the past-due benefits. The Commissioner did not contest the reasonableness of the request.

Timeliness

Federal Rule of Civil Procedure 54 generally requires a motion for attorney’s fees to be filed within 14 days after judgment. The court explained that, in this type of Social Security case, that period is extended until counsel receives notice of the benefits calculation because the 25% statutory limit cannot be calculated before the benefits amount is known.

The Binder Firm received the benefits notice on September 2, 2025, and Farrar filed the fee motion seven days later, on September 9. The court therefore found the motion timely.

Reasonableness of the Fee

Section 406(b) permits a court to approve a reasonable fee of no more than 25% of the claimant’s past-due benefits. The court began with the contingency-fee agreement and examined whether the requested amount was unreasonable because of fraud, overreaching, delay, or an excessive payment that would give counsel a windfall.

The court found that the requested fee was within the 25% statutory limit and found no evidence of fraud or overreaching. It also concluded that the fee was not a windfall. Counsel represented Farrar on a contingency basis, meaning payment depended on obtaining benefits. The opinion states that Charles Binder and Daniel B. Jones each had worked on more than 1,000 Social Security disability claims, and that Binder had previously served as president of the New York Social Security Bar Association.

Counsel spent 32.30 hours on Farrar’s case. The requested fee produced an effective hourly rate of $607.27, which the court found within the range previously approved by courts in the Second Circuit. The court also considered the favorable result and stated that nothing suggested Farrar was dissatisfied with the representation.

EAJA Fee Refund and Disposition

A claimant may receive both an EAJA fee award and a § 406(b) fee award, but the claimant’s attorney must refund the smaller award to the claimant. Because the § 406(b) award exceeded the previously approved EAJA award, the court directed Farrar’s counsel to refund $7,457.85 to Farrar upon receiving the § 406(b) fees.

Judge Judith C. McCarthy granted Farrar’s motion for attorney’s fees under § 406(b) in the amount of $19,614.75. The court also directed counsel to refund the $7,457.85 EAJA award and asked the Clerk of Court to terminate the pending motion.