Galan v. Commissioner of Social Security

Background

Angela Galan sued the Commissioner of Social Security under 42 U.S.C. § 405(g) to challenge the denial of her application for disability benefits. The Social Security Administration denied her application initially and on reconsideration. After an administrative hearing, an administrative law judge also found that she was not disabled, and the agency’s Appeals Council declined further review.

Galan retained Howard D. Olinsky under a contingency-fee agreement providing for a fee of 25% of any past-due benefits awarded to her. In the federal case, the parties agreed to send the matter back to the Commissioner for a new hearing and decision. The court approved that remand on March 30, 2022. The parties also agreed that Galan would receive $4,977 in attorney’s fees and $400 in costs under the Equal Access to Justice Act and 28 U.S.C. § 1920.

After the remand, Galan was found disabled beginning November 10, 2017 and became entitled to $131,317 in past-due benefits. The Social Security Administration withheld $13,595 to pay attorney’s fees. Olinsky then moved for that amount under 42 U.S.C. § 406(b). The Commissioner did not object.

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 claimant’s past-due benefits. The court independently reviews a contingency-fee agreement to ensure that it produces a reasonable result. The court first considers whether the fee is within the 25% limit and whether fraud or overreaching occurred. It then considers the quality and results of the representation, whether the attorney caused delay, and whether the requested fee would be an improper windfall compared with the work performed.

Court’s analysis

Judge Ramos found that the $13,595 request was below the 25% limit and that there was no evidence of fraud or overreaching. Neither Galan nor the Commissioner expressed dissatisfaction with Olinsky’s representation, and Galan ultimately prevailed in obtaining benefits. The opinion also found no evidence that Olinsky caused delay.

The court concluded that the fee was not a windfall. Olinsky spent 20.7 attorney hours on the federal case, reviewed a 485-page administrative record, prepared a 24-page legal memorandum, and successfully negotiated the stipulated remand. The court also considered the length of his involvement, Galan’s lack of objection, and the uncertainty created by the agency’s earlier denials of benefits.

Disposition

The court granted the motion for $13,595 in attorney’s fees under § 406(b). Because Olinsky had already received $4,977 under the Equal Access to Justice Act for the same work, the court directed counsel to refund $4,977 directly to Galan upon receiving the § 406(b) payment. The Clerk was directed to terminate the motion.