Waltke v. Commissioner of Social Security

Background

Melissa Waltke applied for Social Security disability benefits and Supplemental Security Income benefits in December 2016. After the Social Security Administration denied her applications and its Appeals Council denied review, Waltke filed this federal action on April 1, 2021. She had retained attorney Lewis Insler under an agreement providing for a fee of 25 percent of any past-due benefits resulting from successful litigation.

The parties stipulated to a remand to the Social Security Administration before briefing occurred. The court signed the stipulation on August 26, 2021, and entered judgment for Waltke that day. After the remand, the agency found Waltke disabled and issued a February 15, 2026 Notice of Award. The notice stated that the agency had withheld $33,571.25, which was 25 percent of Waltke’s total past-due benefits, for attorney fees.

Insler then sought $3,571.25 in fees under 42 U.S.C. § 406(b), which permits a court to award a reasonable fee for an attorney’s representation in federal court, subject to a 25 percent cap on past-due benefits. Insler did not seek fees under the Equal Access to Justice Act after the remand. The Commissioner did not support or oppose the request but identified issues concerning some time entries and the failure to seek Equal Access to Justice Act fees.

Court’s Analysis

The court found that the requested fee was within the 25 percent statutory cap and found no evidence of fraud or overreaching in the fee agreement. It also found that the fee was consistent with the representation and result because Insler obtained a stipulated remand, and Waltke was later found disabled and awarded benefits.

The court found no unreasonable delay by Insler. It also concluded that the requested amount was not an improper windfall in light of Insler’s experience, the successful result, the 6.86 hours he recorded, and the risk that a contingency-fee attorney might receive no payment. The resulting effective hourly rate was $520.59.

The court nevertheless reduced the fee because Insler did not apply for Equal Access to Justice Act fees. It found that Waltke was eligible to apply after the remand and that Insler should have sought fees for the 3.68 hours he worked before the remand. Using the hourly rates stated in the opinion, the court calculated that Insler likely could have obtained $792.42 under that law. The court reasoned that failing to seek those fees harmed Waltke because an Equal Access to Justice Act award could have reduced the amount ultimately paid from her benefits.

Disposition

The court held that the full requested fee of $3,571.25 was not reasonable because it did not account for the $792.42 in Equal Access to Justice Act fees that Insler likely could have recovered. It therefore reduced the award to $2,778.83. The court’s order states that Waltke’s motion for attorney fees was GRANTED IN PART AND DENIED IN PART, and awarded Insler $2,778.83.