Mercado v. Berryhill
- Beth Freeman
- 5:16-cv-04200
- U.S. District Court · Northern District of California
- 4
In Mercado v. Berryhill, Judge Freeman approved $17,122.90 in attorney fees and ordered a $6,815.68 refund of earlier Equal Access to Justice Act fees.
Mario Arenas Mercado will receive a $6,815.68 refund, while his lawyer may receive $17,122.90 from the past-due benefits award for work performed in federal court.
What happened
Mercado v. Berryhill involved a Social Security benefits appeal in which the court had previously partly granted Mercado’s request for judgment, sent the case back for further agency proceedings, and entered judgment for him. After that process, Mercado received $92,491.60 in past-due disability insurance benefits.
Mercado’s lawyer asked for $17,122.90 for work performed in federal court under a fee agreement providing for 25% of past-due benefits. Together with $6,000 already approved for administrative work, the requested fees totaled 25% of Mercado’s award. The government did not take a position on the request.
Judge Beth Labson Freeman ruled that the requested amount was reasonable and granted the fee motion for $17,122.90. The court also ordered that Mercado receive a refund of $6,815.68 in previously awarded Equal Access to Justice Act fees.
The detailed version
- Mercado v. Berryhill · No. 5:16-cv-04200
- Beth Freeman
- May 15, 2020
Background
This was an application for attorney fees after a Social Security appeal. The court stated that it had previously granted in part Mario Arenas Mercado’s motion for summary judgment, remanded the case for further agency proceedings, and entered judgment for him. On remand, Mercado received $92,491.60 in past-due disability insurance benefits.
Mercado’s lawyer sought $17,122.90 for work performed before the district court under Section 406(b) of the Social Security Act. The fee agreement provided for a fee equal to 25% of past-due benefits, subject to federal-court approval. The Commissioner had already approved $6,000 for work performed during the administrative proceedings. The two amounts together equaled $23,122.90, or 25% of the past-due benefits award.
Legal standard
Section 406(b) allows a court to approve a reasonable attorney fee, up to 25% of past-due benefits, when the court has entered a favorable judgment for a claimant represented by a lawyer. The fee is paid from the claimant’s past-due benefits rather than by the losing party. Courts review contingent-fee agreements independently and may reduce a requested fee if the lawyer provided inadequate representation, delayed the case, or would receive an unreasonable windfall.
When both Section 406(b) fees and Equal Access to Justice Act fees have been awarded, the lawyer must refund to the claimant the smaller fee. The record showed that the court had previously approved $6,815.68 in Equal Access to Justice Act fees, and the lawyer acknowledged that amount had to be refunded if the current request was granted.
Court’s analysis and ruling
The court found no indication that the lawyer’s performance was inadequate or that the lawyer delayed the proceedings to increase the fee. It noted that the lawyer obtained an excellent result, that Mercado supported the request, and that the requested effective hourly rate of $485.76 fell within a range cited by the government for Social Security cases.
Judge Beth Labson Freeman found the requested $17,122.90 reasonable and granted the lawyer’s motion for fees under Section 406(b) in that amount. The court also ordered that Mercado be refunded the $6,815.68 in previously awarded Equal Access to Justice Act fees held in trust.
Read the full 4-page opinion on CourtListener, the free public archive maintained by the Free Law Project.