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cautioning that "focus[ing] too sharply on hourly rates and time would essentially return to the lodestar approach rejected in Gisbrecht"
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Case No. 1:99-CV-325.
July 22, 2004
Carl Michael Weisbrod, for Plaintiff.
Steven MacArthur Mason, for Defendant.
REPORT AND RECOMMENDATION
The presiding district judge referred a pending motion for an award of attorney's fees to the undersigned for consideration, hearing if necessary, and a written report containing proposed findings of fact, conclusions of law and a recommendation for disposition. See Referral Order (Dkt. 19).
See also 28 U.S.C. § 636(b)(1)(B)and Loc. R. CV-72 App. B, R.1(H) for the Assignment of Duties to United States Magistrate Judges.
I. INTRODUCTION
Carl Weisbrod, Esq., ("Weisbrod") successfully represented Larry E. Brannen, who sought benefits available to disabled persons under the Social Security Act. Weisbrod now seeks an award of a reasonable attorney's fee. He clearly is entitled to some award, and defendant, Jo Anne Barnhart, Commissioner of the Social Security Administration ("Commissioner"), does not oppose his motion.One would expect that determination of a straightforward, uncontested motion would be routine and simple. In matters arising under the Social Security Act, however, simplicity often eludes, and this case is no exception. Complexity exists due to overlapping and competing federal statutes. Further, a recent Supreme Court decision seemingly requires federal district courts to both reject and employ traditional standards for determining reasonableness of an attorney's fee request. The inevitable consequence is that uncertainty pervades the issue. Thus, analysis of all relevant points requires an abstruse, perhaps wearisome, discussion of the subject.
II. NATURE OF CASE; Prior Proceedings
Plaintiff, Larry E. Brannen ("Brannen"), applied for Social Security Disability and Supplemental Security Income benefits via separate applications submitted in 1994 and 1996, respectively. His applications were denied throughout several administrative steps. After exhausting all administrative appeals, he brought this action seeking judicial review in federal district court. The Honorable Joe J. Fisher, district judge, reversed the Commissioner's decision and remanded the case with instructions for further consideration.
Upon remand, the Commissioner granted Brannen's application for Title II benefits. The Commissioner's favorable decision entitles Brannen to receive prospective disability benefits of indefinite duration. The decision also awarded past-due benefits in the amount of $119,926.72.
III. LEGAL REPRESENTATION; PRIOR FEE AWARDS AND CURRENT MOTION
Throughout all proceedings, Brannen was represented by attorneys associated with the law firm of Morgan Weisbrod, with offices in Dallas and Bellaire, Texas. At the administrative level, Brannen's counsel was Paul Burkhalter, Esq. In federal court, lead counsel was Carl Weisbrod, Esq. Mr. Weisbrod was assisted by Gayle Troutman, Esq., another attorney.
Before commencing this federal action, Brannen entered into a contingent-fee agreement with Morgan Weisbrod. The agreement establishes a professional fee of twenty-five percent of past-due benefits that might be recovered as a result of litigation.
As reported earlier, litigation was successful, and administrative proceedings upon remand ended with an award of substantial past-due benefits. Mr. Burkhalter applied for and received from the Commissioner an award of $22,600 as a reasonable attorney's fee for services provided in administrative proceedings. Mr. Weisbrod's current motion seeks an additional award from the court of $7,381.68 pursuant to the Social Security Act, 42 U.S.C. § 406(b), for professional services rendered in court. This additional requested sum represents the difference between the previous administrative fee award and twenty-five percent of Brannen's total past-due benefits.
In effect, the motion asks the court to implement terms of the contingent-fee agreement. However, Mr. Weisbrod further supports his motion with documentation including (1) professional hours worked by Mr. Weisbrod (9.25) and Ms. Troutman (15); (2) Mr. Weisbrod's normal hourly rate in non-contingent-fee cases ($300); and (3) fee-related arguments regarding risk of loss, benefits achieved, and Mr. Weisbrod's specialized experience of twenty-five years.
Mr. Weisbrod's motion also acknowledges that he received an earlier award of attorney's fees from this court under the Equal Access to Justice Act (EAJA). See 28 U.S.C. § 2412(d)(1)(A). Mr. Weisbrod asserts that if his current motion is granted, he will remit Judge Fisher's previous award to Brannen.
After Weisbrod successfully represented Brannen in the original action seeking judicial review of the Commissioner's decision, Judge Fisher awarded $3,031.25 as a reasonable attorney's fee. See Dkt. No. 16.
IV. PRINCIPLES OF ANALYSIS
Determining attorney's fee awards in Social Security cases is complicated by sundry sources with differing standards and differing limits on the maximum amount of a permissible award. Moreover, availability of multiple fee-award sources raises a specter of undeserved windfall through double recovery. Thus, the court appropriately reviews these sources and their respective standards as a threshold matter.
A. Sources of Attorney's Fees in Social Security Cases
1. Social Security Act
When a claimant prevails, the Social Security Act authorizes the Commissioner to award attorney's fees for work done at the administrative level. See 42 U.S.C. § 406(a). Similarly, the Act permits a federal district court to award attorney's fees for representation before the court. See 42 U.S.C. § 406(b). Attorney's fees awarded pursuant to either subsection of Section 406 are withheld by the Commissioner and paid directly to the attorney out of past-due benefits awarded. See 42 U.S.C. § 406(a), (b); 20 C.F.R. § 404.1720(b)(4) (2003); Shepherd v. Apfel, 981 F. Supp. 1188, 1191 (S.D. Iowa 1997) (quoting Burnett v. Heckler, 756 F.2d 621, 626 (8th Cir. 1985)).
For successful work at the administrative level, the Commissioner may award a fee based either on a fee petition orfee agreement. See 42 U.S.C. § 406(a)(1) (fee petitions); 406(a)(2) (fee agreements); Gisbrecht v. Barnhart, 535 U.S. 789, 794 (2002) (describing how Social Security fees are authorized by the Commissioner). When attorneys elect to employ the fee agreement method, the agreement must be submitted prior to the Commissioner's favorable determination of the claim. See 42 U.S.C. § 406(a)(2)(A)(i). Moreover, the amount agreed to between attorney and claimant may not exceed the lesser of 25 percent of past due benefits or $4,000 (increased to $5,300 in February 2002). See 42 U.S.C. § 406(a)(2)(A)(ii). When a fee agreement is filed according to statute it will generally be approved. See Gisbrecht, 535 U.S. at 795.
Attorneys may utilize the fee petition method at the close of the case after their services end. See Social Security Administration, Representing Claimants: The Fee Petition Process, http://www.ssa.gov/representation/fee_petitions.htm. An award under this method is limited in amount only by requirements that it be reasonable and not exceed twenty-five percent of past-due benefits. See 42 U.S.C. § 406(a)(1); 20 C.F.R. § 404.1730.
These alternative methods are mutually exclusive. See Social Security Administration, Overview of Representative's Fees: SSA's Fee Authorization Processes, http://www.ssa.gov/representation/overview.htm. This circumstance confronts practitioners with a knotty dilemma. When success occurs at an early stage, the convenient and simple fee agreement method is attractive. However, when cases become protracted, and require prosecution through every administrative level of appeal, the relatively low maximum award available under the fee agreement option generates inadequate fees. Accordingly, practitioners commonly negotiate tiered fee agreements wherein agreed-upon attorney fees increase at advanced levels of the administrative process. See Social Security Administration, Office of Hearings and Appeals, Hearings, Appeals and Litigation Manual (HALLEX) I-1-2-15 (January 28, 2003); Social Security Administration, Representing Claimants Home: Fee Agreements: The Fee Agreement Process, http://www.ssa.gov/representation/fee_agreements.htm.
The Social Security Administration instructs practitioners that the Commissioner will "disapprove" such tiered fee agreements when benefits are approved at an advanced stage of the proceeding where a tiered agreement calls for a fee larger than allowed by statute should the Commissioner award a fee based on a fee agreement. See id. This bureaucratic legalese, while sounding adverse, is in effect solicitous of attorneys' interests. The Commissioner's "disapproval" unweds practitioners from their fee agreements (and low statutory case limits), and frees them to then file fee petitions which can generate a more suitable award.
In the present case, the client entered into a two-tiered fee agreement on June 12, 1999, after the Commissioner rendered an adverse decision. The agreement provided that upon a favorable decision by the Commissioner at any level past the first hearing at the ALJ level of appeal, the fee would be twenty-five percent of any past-due benefits awarded.
A federal district court lacks authority to award fees for work done at the administrative level. Brown v. Sullivan, 917 F.2d 189, 191 (5th Cir. 1990) (abrogated by Gisbrecht v. Barnhart, 535 U.S. 789, 789 (2002) upon other grounds). Likewise, the district court generally does not possess jurisdiction to review an attorney's fee award of the Commissioner. See Pittman v. Sullivan, 911 F.2d 42, 46 (8th Cir. 1990); Schneider v. Richardson, 441 F.2d 1320, 1321 (6th Cir. 1971). Consequently, when attorneys litigate at both levels, they ordinarily must seek attorney's fees from both the district court and the Commissioner to receive full and fair compensation. See, e.g., Brown v. Sullivan, 917 F.2d at 191; Coppett v. Barnhart, 242 F. Supp.2d 1380, 1382-83 (S.D. Ga. 2002).
2. Equal Access To Justice Act
A prevailing litigant also may recover an award of attorney's fees pursuant to EAJA, an entirely separate statute. EAJA requires district courts to award reasonable attorney's fees when the Commissioner's position in the action was not "substantially justified." See 28 U.S.C. § 2412(d)(1)(A). Unlike attorney's fees awarded under the Social Security Act, which are drawn from the claimant's recovery of past-due benefits, attorney's fees awarded pursuant to the EAJA are paid by the United States government. See 28 U.S.C. § 2412(d)(4); Orner v. Shalala, 30 F.3d 1307, 1309 (10th Cir. 1994) ("Fees under § 406(b) satisfy a client's obligation to counsel and, therefore, are paid out of the plaintiff's Social Security benefits, while fees under the EAJA penalize the Secretary for assuming an unjustified legal position and, accordingly, are paid out of agency funds.")
Federal district courts may award attorney's fees to prevailing claimants and their attorneys under both EAJA and the Social Security Act. Gisbrecht, 535 U.S. at 796. An EAJA award is separate from a Section 406(b) award, and neither is limited or affected by the other. However, attorneys cannot achieve double recovery. When both awards are bestowed, attorneys must refund the lesser award to their clients. Id. Thus, an EAJA award, in addition to a 406(b) award, "effectively increases the portion of past-due benefits the successful Social Security claimant may pocket." Id.
For this reason, some courts encourage attorneys to apply for fees under both the EAJA and section 406(b). See, e.g., Shepherd, 981 F. Supp. at 1194; Taylor v. Heckler, 608 F. Supp. 1255, 1259-60 (D.N.J. 1985).
3. Summary
When Social Security cases are litigated administratively and judicially, prevailing claimants and their attorneys may recover up to three attorney's fee awards: (1) from the Commissioner pursuant to 42 U.S.C. § 406(a); (2) from the district court pursuant to 42 U.S.C. § 406(b); and (3) from the district court pursuant to 28 U.S.C. § 2412(d)(1)(A). When both the second and third awards are received, the lesser must be returned to the client.
B. Fee Determinations
1. General Rules
Generally, the stated object of every attorney fee probe is determination of a "reasonable fee." For example, for successful work at the administrative level, the Commissioner must "fix . . . a reasonable fee" in response to an attorney's fee petition. 42 U.S.C. § 406(a)(1) (italics added). The Commissioner considers several reasonableness factors established by regulation. See 20 C.F.R. § 404.1725(b) (2003) (listing factors for Commissioner to consider).
For professional services provided in court, the court may award "a reasonable fee for such representation, not in excess of 25 percent of the total past-due benefits to which the claimant is entitled. . . ." 42 U.S.C. § 406(b)(1)(A) (italics added). The aggregate recovery of attorney's fees from the Commissioner and the court may not exceed twenty-five percent of the claimant's recovery of past-due benefits. Dawson v. Finch, 425 F.2d 1192, 1195 (5th Cir. 1970).
Finally, for EAJA applications, the court shall award reasonable fees if the Government's position was unjustified, unless special circumstances exist making such an award unjust. See 28 U.S.C. § 2412(d)(1)(A), (d)(2)(A). EAJA limits fees to $125 per hour expended at the district court level, unless the court determines that an increase in the cost of living or a special factor justifies a higher fee. See 28 U.S.C. § 2412(d)(2)(A); Gisbrecht, 535 U.S. at 796. District courts in Texas routinely add cost-of-living adjustments.
"(A)ttorney fees shall not be awarded in excess of $125 per hour unless the court determines that an increase in the cost of living or a special factor, such as the limited availability of qualified attorneys for the proceedings involved, justifies a higher fee."28 U.S.C. § 2412(d)(2)(A)(ii)(2002).
Mr. Weisbrod practices in the Dallas division of the Northern District of Texas. Courts in that district award increased attorney's fees in Social Security cases, equal to or greater than $125.00. See Sandoval v. Apfel, 86 F. Supp.2d 601, 614 n. 23 (N.D. Tex. 2000) (awarding attorney's fee of $131.25). A court in this district also awarded increased attorney's fees for a Dallas attorney. Acy v. Commissioner of Social Security, No. 6:99-CV-433 (E.D. Tex. May 8, 2000) (order granting motion for award of attorney fees). In each instance, the increase was based on a cost-of-living adjustment indicated by the Consumer Price Index for Dallas-Fort Worth, Texas.
C. Reasonable Fees Under Section 406(b)
The present motion seeks fees from the court under 42 U.S.C. § 406(b) for services rendered in court. The district court, not the parties, is ultimately responsible for ensuring that the fee awarded is reasonable. See Gisbrecht, 535 U.S. at 807. Consequently, the court may not grant the motion simply because the Commissioner does not oppose it. Moreover, the attorney seeking the fee bears the burden of persuasion that the fee sought is reasonable. See id. at 807 n. 17.
1. Circuit Methodology
Other than limiting the aggregate amount to twenty-five percent of the claimant's past-due benefits, Congress provides little instruction as to what constitutes a "reasonable fee." See Kay v. Apfel, 176 F.3d 1322, 1324 (11th Cir. 1999). From this vacuum, federal circuit courts of appeal necessarily developed their own methodologies for determining reasonable fees. The Fifth Circuit, like a majority of other federal circuits, embraced a "lodestar" approach to fee setting. See Brown v. Sullivan, 917 F.2d at 191-93.
For similar rules adopted in other circuits, see Coup v. Heckler, 834 F.2d 313 (3d Cir. 1987); Craig v. Secretary, Dept. of Health and Human Servs., 864 F.2d 324 (4th Cir. 1989); Cotter v. Bowen, 879 F.2d 359 (8th Cir. 1989); Hubbard v. Shalala, 12 F.3d 946 (10th Cir. 1993); Kay v. Apfel, 176 F.3d 1322 (11th Cir. 1999).
The starting point for a lodestar determination is "'the number of attorney hours reasonably expended on litigation multiplied by a reasonable hourly rate.'" Brown v. Sullivan, 917 F.2d at 192 (quoting Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)). The product of this calculation may then be adjusted upward or downward based on the circumstances of each case. Id. The district court's consideration is guided by twelve factors established in Johnson v. Georgia Highway Express, Inc., 488 F.2d 714, 717-19 (5th Cir. 1974). Brown v. Sullivan, 917 F.2d at 192-93. The district court has "broad discretion to value services and weigh risks assumed by the attorney," and may award fees reflecting the "novelty and complexity of the litigated issues" as well as the "quality of the legal representation." Id. at 193.
The Johnson factors include: (1) the time and labor required; (2) the novelty and difficulty of the questions; (3) the skill requisite to perform the legal service properly; (4) the preclusion of other employment by the attorney due to acceptance of the case; (5) the customary fee; (6) whether the fee is fixed or contingent; (7) time limitations imposed by the client or the circumstances; (8) the amount involved and the results obtained; (9) the experience, reputation, and ability of the attorneys; (10) the "undesirability" of the case; (11) the nature and length of the professional relationship with the client; and (12) awards in similar cases. See Johnson, 488 F.2d at 717-19.
The lodestar method minimizes the role of contingent-fee agreements. Id. at 191-93. The Fifth Circuit concluded that "a private fee arrangement, standing alone, is not dispositive." Id. Rather, the Court found a contingent-fee agreement simply one of the Johnson factors to consider in determining a reasonable fee. Id. Therefore, an attorney seeking a Section 406(b) fee award could not appropriately argue for a fee based on a contingency-fee contract, or in the alternative, that the contingency-fee contract should be used as a benchmark. Id.
2. Supreme Court Construction
A majority of circuits adopted the lodestar approach exemplified in Brown, while a few circuits gave larger effect to contingent-fee agreements. See Gisbrecht, 535 U.S. at 799. Gisbrecht resolved the circuit split by rejecting the lodestar approach when a contingent-fee agreement exists. See id. at 802-09. The Supreme Court concluded:
"§ 406(b) does not displace contingent-fee agreements as the primary means by which fees are set for successfully representing Social Security benefits claimants in court. Rather, § 406(b) calls for court review of such arrangements as an independent check, to assure that they yield reasonable results in particular cases."Id. at 807 (italics added).
The Court stated, however, that district courts retain discretion to reduce an attorney's fee "based on the character of the representation and the results the representative achieved." Id. at 808. Moreover, if the fee-requesting attorney is responsible for delay, or the benefits to the attorney are large in comparison to the amount of time spent on the case — resulting in a windfall — the district court may adjust the fee downward. Id. To further this objective, a district court
"may require the claimant's attorney to submit, not as a basis for satellite litigation, but as an aid to the court's assessment of the reasonableness of the fee yielded by the fee agreement, a record of the hours spent representing the claimant and a statement of the lawyer's normal hourly billing charge for noncontingent-fee cases."Gisbrecht, at 808.
Other than establishing primacy of a contingent-fee agreement, the Supreme Court offered little guidance, and left many questions unanswered. While the Court expressly rejected the lodestar approach as a starting point, certain aspects of a lodestar approach remain in the calculus. For example, the Court instructs that district courts should look to the character of the representation and results obtained. Id. at 808. Furthermore, the Court suggests examining hours worked and a reasonable hourly rate. Id. The overall result is a conundrum. District courts are left to determine how much of the lodestar approach is still viable. Recognizing this problem, Justice Scalia remarked:
"I do not know what the judges of our district courts and courts of appeals are to make of today's opinion."Id. at 809 (Scalia, J., dissenting).
3. District Court Methodology After Gisbrecht
No federal circuit court of appeals has of yet issued a decision interpreting or providing guidelines for implementing Gisbrecht. District courts tackling the issue in the wake of Gisbrecht, reflect a variety of approaches, usually reverting to traditional lodestar factors, including hours worked in relation to the fee, often calculating a de facto hourly rate and comparing it to the attorney's non-contingent hourly rate. See, e.g., Claypool v. Barnhart, 294 F. Supp.2d 829, 833-34 (S.D. W. Va. 2003); Coppett, 242 F. Supp.2d at 1384-85. Lower courts also look to quality of representation and results obtained. See, e.g., Brown v. Barnhart, 270 F. Supp.2d 769, 772-73 (W.D. Va. 2003); Claypool, 294 F. Supp.2d at 833. Furthermore, as Gisbrecht directs, the courts often are cognizant of whether the attorney caused delay. See, e.g., Wallace v. Barnhart, No. C-01-4108, 2004 WL 883447, at *4 (N.D. Iowa Apr. 22, 2004).
To guard against windfalls, some courts consider additional factors not explicitly proffered in Gisbrecht. These include risk of loss in the representation, experience of the attorney, percentage of the past-due benefits the fee constitutes, value of the case to a claimant, degree of difficulty, and whether the client consents to the requested fee. See, e.g., Hearn v. Barnhart, 262 F. Supp.2d 1033, 1036-38 (N.D. Cal. 2003) (considering risk of loss, experience of counsel, percentage of funds the fee consumes, value of the case to the plaintiff, and client's consent to fee requested); Coppett, 242 F. Supp.2d at 1383-85 (considering risk of loss, difficulty of the case, and skill and experience of attorney).
Ultimately, however, the majority of post- Gisbrecht opinions defer to contingent-fee agreements notwithstanding their recitation of and lip service to traditional lodestar factors. See, e.g., Hearn, 262 F. Supp.2d at 1037 (listing cases reflecting deference to contingent-fee agreements). Thus, courts have allowed de facto hourly rates that exceed or greatly exceed the attorney's non-contingent hourly rate. See, e.g., Claypool, 294 F. Supp.2d at 833-34 (awarding fee equivalent to $1433.12 per hour); Hearn, 262 F. Supp.2d at 1037-38 (awarding fee equivalent to $450 per hour); Brown v. Barnhart, 270 F. Supp.2d at 772-73 (awarding $977.20 per hour); Dodson v. Barnhart, No. 4:00-CV-22, 2002 WL 31927589, at *1-2 (W.D. Va. Oct. 22, 2002) (awarding $694.44 per hour). These courts recognize that a reasonable contingent-fee agreement may not be wholly consistent with a reasonable hourly rate. See Hearn, 262 F. Supp.2d at 1037. While demonstrating that they do not interpret Gisbrecht as requiring blind acceptance of a contingent-fee agreement, these courts in practice weigh heavily terms of such agreements in their reasonable-fee determinations.
V. APPLICATION AND ANALYSIS
Although identifying applicable factors and marshaling them into a working analytical model is tedious, their application in this particular case is not arduous. Gisbrecht and its progeny command the court to give primacy to the contingent-fee agreement. When, as here, the agreement calls for a fee of twenty-five percent of past-due benefits — the same percentage allowed by statute — the fee contemplated by the agreement, if not presumptively reasonable, is at least a forceful starting point and solid benchmark.
Moreover, Weisbrod easily carries his burden of showing that the amount requested is reasonable in any event. Neither Gisbrecht's instructions nor traditional lodestar-type factors raise cause for concern that the additional amount sought here represents a potential windfall. First, a total of 24.25 hours, is a reasonable amount of time to spend on this type of case before a district court. See Hardy v. Callahan, No. 9:96-CV-257, 1997 WL 470355, at *9 (E.D. Tex. Aug. 11, 1997) (finding a typical EAJA application claims between thirty and forty hours worked at the district court level). Second, given Mr. Weisbrod's specialized experience, a non-contingent fee rate of $300 per hour is customary and reasonable, and the amount he requests under the contingent-fee agreement results in an equivalent de facto hourly rate of $304.40 ($7,381.68 [amount requested] ÷ 24.5 [hours expended] = $304.40). Third, Mr. Weisbrod's efforts resulted in complete success, with a sizable award of past-due benefits plus an award of prospective benefits of indefinite duration, from which no fee will be deducted. Fourth, there always was a substantial risk of failure because judicial review is by nature deferential to the Commissioner's decision, and every administrative claims adjudicator who initially considered Mr. Brannen's application through several levels of review rejected his claim of disability. Finally, granting the motion will not result in a double recovery. Mr. Weisbrod, an officer of the court, stipulates that when the court awards the additional amount requested, he will remit the lesser EAJA amount previously awarded directly to Mr. Brannen. Thus, Mr. Brannen will pocket additional past-due benefits.
See Hearn, 262 F. Supp.2d at 1037 (recognizing risk of loss in Title II cases); Social Security Advisory Board, Disability Decision Making: Data and Materials 86 (2001) (providing statistics on success rates in federal district court of Social Security cases).
Under strict scrutiny, the court might find a deficiency in Mr. Weisbrod's fee application by his failure to provide the court with a résumé of the experience, expertise and normal billing rate of the assisting attorney, Ms. Troutman. Also, submitted summaries of the respective attorneys' time are susceptible of being interpreted as double billing. These deficiencies could warrant either a reduction of the requested fee or an order to provide supplemental and clarifying information before acting on the request. However, the Supreme Court expressly instructs district courts not to apply the lodestar method strictly. See Gisbrecht, 535 U.S. at 808 (stating that analysis of hours spent in representation and normal non-contingent hourly rate should not be a basis for "satellite litigation," and that an attorney's non-contingent hourly rate is merely an aid in determining reasonableness). To focus too sharply on hourly rates and time would essentially return to the lodestar approach rejected in Gisbrecht. See Wallace, 2004 WL 883447, at *4 n. 6; Claypool, 294 F. Supp.2d at 834.
The recap of services rendered by Mr. Weisbrod reflects time spent reviewing the administrative transcript on August 3, 1999. The recap of services rendered by Ms. Troutman reflects additional time spent reviewing the administrative transcript on August 10, 1999. Each entry reflects additional services performed in the same session, and there are substantive differences in the attorneys' descriptions of their transcript review process. Thus, there may be no duplication. Even if the court assumes otherwise, a reasonable conclusion is that no more than a couple of hours were involved at most.
In any event, the omitted and ambiguous information is not significant. Mr. Weisbrod provides evidence that the hourly rate requested is relatively typical for attorneys specializing in this arcane area of the law. Thus, the amount requested is objectively reasonable, even if it is generous in relation to the assisting attorney's normal non-contingent-fee rate, and even if the accounting for total hours expended by both attorneys is imprecise.
A generous de facto hourly rate, among other things, reflects the contingent nature of the representation. See Dodson v. Barnhart, 2002 WL 31927589, at *2 (discussing contingent-fee agreements in Social Security cases). For this reason, the de facto hourly rate in a contingent-fee case may be substantially higher than the attorney's non-contingent hourly rate and still be reasonable. See Hearn, 262 F. Supp.2d at 1037 (finding that courts recognize that basing a reasonableness determination of a contingent fee on a simple hourly rate is inappropriate); Coppett, 242 F. Supp.2d at 1385 n. 7 (noting that risk and the waiting to receive a fee can make a contingency fee reasonable); Dodson, 2002 WL 31927589, at *2 (arguing that contingent fees may appropriately exceed a reasonable hourly rate).
In sum, the court can grant the pending motion with confidence that its action will be with true fidelity to its judicial duty to ensure that the fee awarded is reasonable. With a twenty-five percent contingent fee as a solid starting point, consideration of all the post- Gisbrecht potentially limiting factors (identified in Sections IV. C. 2-3, supra) raises no red flags. A strict lodestar application might or might not result in some slight reduction of the fee for that portion of the work performed by the assisting attorney, but affording primacy to the contingent-fee agreement, and considering that the amount requested is objectively reasonable in any event, there is no reason for the court to award a reduced fee.
Under a pure lodestar approach, there might be an initial reduction based on the assisting attorney's reasonable and customary hourly rate. However, application of remaining Johnson factors might well warrant a corresponding upward adjustment. See Brown v. Sullivan, 917 F.2d at 192; Johnson, 488 F.2d at 717-19.
VI. RECOMMENDATION
The motion for an attorney's fee award of $7,381.68 pursuant to 42 U.S.C. § 406(b) should be granted, conditioned, however, upon counsel's immediate remittance to the plaintiff, Larry E. Brannen, of $3,031.25 previously awarded by the court under the Equal Access to Justice Act.
VII. OBJECTIONS
Objections must be: (1) specific, (2) in writing, and (3) served and filed within ten days after being served with a copy of this report. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 1(a), 6(b), and 72(b).
A party's failure to object bars that party from: (1) entitlement to de novo review by a district judge of proposed findings and recommendations, Rodriguez v. Bowen, 857 F.2d 275, 276-77 (5th Cir. 1988), and (2) appellate review, except on grounds of plain error, of unobjected-to factual findings and legal conclusions accepted by the district court, Douglass v. United Servs. Auto. Ass'n., 79 F.3d 1415, 1417 (5th Cir. 1996) (en banc).