V.R. v. Kijakazi

Background

Attorney Harvey P. Sackett, representing V.R., moved for attorney’s fees under 42 U.S.C. § 406(b) after V.R. successfully challenged the denial of Social Security disability insurance benefits. In the earlier stage of the case, the court granted in part and denied in part V.R.’s motion for summary judgment, remanded the case for further proceedings, and entered judgment. The court later approved a $6,000 fee award under the Equal Access to Justice Act.

After the remand, the Social Security Administration determined that V.R. was entitled to $174,123.90 in past-due benefits for February 2016 through March 2023. The agency withheld $43,530.98, or 25% of those benefits, for attorney’s fees. Sackett sought $40,000 under § 406(b) and V.R.’s contingency-fee agreement, which allowed a fee of no more than 25% of past-due benefits. Sackett stated that he would refund the earlier $6,000 fee award to V.R., resulting in a net fee of $34,000 to him.

The Commissioner filed an untimely response. The court did not consider it and struck it from the record. V.R. did not object or otherwise respond.

Legal standard

Section 406(b) permits a court to award a reasonable fee for an attorney’s representation in a successful Social Security case, subject to a limit of 25% of the past-due benefits resulting from the judgment. The court must review a contingency-fee agreement to ensure that it produces a reasonable result. Relevant considerations include the quality of the representation, the result achieved, whether the attorney caused improper delay, and whether the benefits are unusually large compared with the time spent on the case. A lodestar calculation—the usual approach of multiplying hours by an hourly rate—does not control this analysis.

Court’s analysis and ruling

The court found that Sackett’s requested fee was reasonable. The fee agreement complied with the 25% statutory limit, Sackett obtained a favorable result for V.R., and V.R. received substantial past-due benefits. The record did not show substandard representation or delay intended to increase the fee. Although Sackett obtained two relatively modest extensions because of staffing and workload issues, the court found no undue delay.

Sackett’s records showed that he spent 29.75 hours working on the appeal. The court recognized that this produced a high hourly rate but explained that a lodestar analysis did not control the § 406(b) review. The court also considered the risk Sackett assumed by representing V.R. on a contingency basis beginning in January 2017, before the agency had decided V.R.’s application.

The court granted the motion for fees under 42 U.S.C. § 406(b), awarded Sackett $40,000, and ordered him to refund V.R. the previously awarded $6,000 in Equal Access to Justice Act fees.