Jay D. v. Bisignano

Background

Jay D. moved for attorney’s fees under 42 U.S.C. § 406(b) for his lawyer’s work before the federal court. The case had previously been sent back to the Social Security Administration, and Jay D. obtained past-due disability benefits totaling $63,846.00. Twenty-five percent of those benefits was $15,961.50. Counsel requested $15,261.50, which represented approximately 23.9 percent of the past-due benefits.

The court had previously approved an $8,500 attorney’s-fee award under the Equal Access to Justice Act. The Commissioner did not object to the requested § 406(b) fee and took no position on whether it was reasonable. The Commissioner reminded the court that, if § 406(b) fees were awarded, counsel would have to return the Equal Access to Justice Act award to Jay D.

Reasonableness of the Fee

Section 406(b) permits a court to award a reasonable fee for successful representation before the court, subject to a limit of 25 percent of the claimant’s past-due benefits. The court independently reviewed whether the requested fee was reasonable.

The court found that counsel’s representation was successful because it resulted in an award of past-due disability benefits. It also found that the requested fee complied with the contingency-fee agreement, which capped the fee at 25 percent of past-due benefits. The court further concluded that the requested fee was not too large compared with the time counsel spent on the case. The requested amount divided by the 37.8 hours listed in counsel’s time sheet produced an hourly rate of $403.74, which the court found reasonable in light of counsel’s experience and the risk of receiving no payment.

The opinion notes that the Social Security Administration separately withheld $9,200 of the past-due benefits to pay a representative for work before the agency. The court explained that the 25-percent limit for § 406(b) fees applies to court-level fees. The court also declined to decide whether paralegal time could be included because that issue would not affect the motion’s outcome.

Order

Judge Menendez granted Jay D.’s motion for attorney’s fees under § 406(b) and awarded $15,261.50. The government was ordered to pay that amount directly to counsel within 30 days of the order.

Because the § 406(b) award was larger than the $8,500 Equal Access to Justice Act award, counsel must refund the $8,500 to Jay D. after receiving the § 406(b) payment. The court rejected counsel’s request to make that refund indirectly by subtracting $8,500 from the § 406(b) award.

The court also denied as moot counsel’s separate motion asking for a ruling on the pending attorney’s-fee motion.