Opinion
20-CV-5439 (JMF)(KHP)
07-05-2023
SERONIA STEFANIE KEARNEY, Plaintiff, v. ANDREW M. SAUL, COMMISSIONER OF SOCIAL SECURITY, Defendant.
REPORT & RECOMMENDATION ON MOTION FOR ATTORNEY'S FEES
KATHARINE H. PARKER, UNITED STATES MAGISTRATE JUDGE
TO: HONORABLE JESSE M. FURMAN, United States District Judge
Before the Court is Plaintiff's counsel's (“Petitioner”) motion pursuant to 42 U.S.C. § 406(b)(1) (“Section 406(b)”) for reasonable attorneys' fees in the amount of $12,861.32 in connection with work performed to secure Supplemental Security Income (“SSI”) benefits and $15,219.50 in social security disability (“DIB”) benefits for Plaintiff. (ECF Nos. 26, 32.) For the reasons set forth below, I recommend granting the motion.
BACKGROUND
Plaintiff's counsel, Anselmo A. Alegria, represented Plaintiff in this action for judicial review of Defendant's decision denying DIB and SSI to Plaintiff. Petitioner represented Plaintiff pursuant to a contingency fee agreement that provided for counsel to receive 25% of any past due benefits awarded to Plaintiff. (ECF No. 34.) On May 19, 2021, the parties stipulated and agreed to remand Plaintiff's case to the Commissioner for further proceedings. (ECF No. 22.)
On August 9, 2021, the parties stipulated and agreed to attorneys' fees and costs pursuant to the Equal Access to Justice Act (“EAJA”) of $4,750. (ECF No. 25.)
EAJA fees are determined based on the time expended and the attorney's hourly rate. 28 U.S.C. § 2412(d)(1)(B).
Following remand, the SSA conducted further proceedings and ultimately found Plaintiff was disabled and entitled to benefits. In a letter dated October 5, 2022, the SSA indicated that it calculated past due SSI benefits for Plaintiff of $51,445.28 but did not indicate how much was being withheld for attorneys' fees. (ECF No. 28-1.) Petitioner states that his office did not receive the SSA's letter until February 16, 2023. (ECF No. 27.) On February 23, 2023, Petitioner filed a motion for an award of attorneys' fees pursuant to Section 406(b) in the amount of $12,861.32 in connection with recovering Plaintiff's SSI benefits. (ECF No. 26.)
On April 2, 2023, the SSA indicated that it calculated past due DIB to be $60,878 and indicated that SSA withheld $15,219.50 from past due benefits to pay a possible attorneys' fee request pursuant to Section 406(b), which provides that when a disability claimant is successful in federal court, the court may authorize payment of “reasonable” attorneys' fees up to 25% of past due benefits. 42 U.S.C. § 406(b)(1)(A). On April 14, 2023, Petitioner filed a motion for an award of attorneys' fees pursuant to Section 406(b) in the amount of $15,219.50 in connection with recovering Plaintiff's SSI benefits. (ECF No. 32.)
Unlike attorneys' fees awarded pursuant to the EAJA, which are paid by the Government, fees awarded pursuant to Section 406(b) are payable from the claimant's past due benefits. Accordingly, Defendant has no direct financial stake in the outcome of this fee application, but it may “play[ ] a part in the fee determination resembling that of a trustee for the claimants.” Gisbrecht v. Barnhart, 535 U.S. 789, 798 n.6. (2002). Fee awards may be made under both the EAJA and Section 406(b), provided the attorney refunds the claimant the amount of the smaller fee. Id. at 796.
Petitioner's affirmation states that the firm logged 23.3 hours representing Plaintiff before this Court. The requested fee award related to recovery of SSI benefits amounts to a de facto hourly rate $551.99. The requested fee award related to recovery of DIB benefits amounts to a de facto hourly rate of $653.20.
Defendant filed a response to this motion deferring to the Court to determine whether the requested fee is timely and reasonable. (ECF No. 35.)
ANALYSIS
1. Timeliness
A motion for attorneys' fees pursuant to Section 406(b) must be filed “no later than 14 days after the entry of judgment.” Fed.R.Civ.P. 54(d)(2)(B); Sinkler v. Berryhill, 932 F.3d 83, 87-88 (2d Cir. 2019). There is “some uncertainty” as to whether the 14-day filing period runs from the time the plaintiff, or the plaintiff's counsel, receives notice from the SSA of the benefits calculation. Gonzalez v. Comm'r of Soc. Sec., 2022 WL 17821228, at *3 (S.D.N.Y. Dec. 20, 2022) (citing Sinkler, 932 F.3d at 88, 91). A court is free to “enlarge th[e] filing period where circumstances warrant.” Sinkler, 932 F.3d at 89 (citing Fed.R.Civ.P. 54(d)(2)(B) and Walker v. Astrue, 593 F.3d 274, 280 (3d Cir. 2010)). Courts in this Circuit routinely excuse short, reasonable delays in filing an attorney's fee motion. See, e.g., Johnson v. Comm'r of Soc. Sec., 2019 WL 11270462, at *2 (E.D.N.Y. Dec. 17, 2019), report and recommendation adopted, 2020 WL 6128966 (E.D.N.Y. Oct. 19, 2020) (excusing lateness of attorney's fee motion that was “technically untimely” by nine days); David B. v. Comm'r of Soc. Sec., 2019 WL 6123780, at *2 (N.D.N.Y. Nov. 19, 2019) (granting attorney's fee application that was filed eleven days late); Lesterhuis v. Comm'r of Soc. Sec., 2019 WL 4892681, at *2 (W.D.N.Y. Oct. 4, 2019) (granting attorney's fee motion filed “just nine days after the 14-day deadline”).
In this case, the SSA mailed the Notice of Award letter regarding SSI benefits on October 5, 2022. It is not clear when Plaintiff received the Notice of Award letter, but Petitioner did not receive the letter until February 16, 2023. Petitioner then filed the instant motion on February 23, 2023. Assuming the 14-day period began to run on the date Petitioner received the letter, this motion is timely.
Even if Petitioner received the Notice of Award letter in connection with Plaintiff's SSI benefits on an earlier date and the 14-day period began to run on that earlier date such that this motion is technically untimely, a small enlargement of the filing period is warranted because any delay was not undue and because the fee award for SSI benefits are offset by the DIB benefits, which were not awarded until April. Specifically, the SSA mailed the Notice of Award letter regarding DIB benefits on April 2, 2023. Petitioner then filed the instant motion on April 14, 2023. Therefore, the motion was timely filed.
2. Reasonableness
In determining the reasonableness of a fee request pursuant to Section 406(b), the court must ensure the contingency percentage is within the 25% cap; that there is no evidence of fraud or overreach in the agreement between the plaintiff and the attorney-petitioner; and that the requested fee does not result in an improper windfall to the attorney. Wells v. Sullivan, 907 F.2d 367, 372 (2d Cir. 1990). In evaluating whether the requested amount is a windfall, the Court must look beyond the de facto hourly rate and should consider the following factors: (i) the ability, expertise, and efficiency of the lawyers; (ii) the nature and length of the professional relationship with the claimant; (iii) the claimant's satisfaction; and (iv) whether it was uncertain that the case would result in an award of benefits and the effort it took to achieve that result. Fields v. Kijakazi, 24 F.4th 845, 854-56 (2d Cir. 2022) (holding district court abused its discretion in finding requested attorney's fee award amounted to a windfall). In Fields, the Second Circuit explained that “even a relatively high hourly rate may be perfectly reasonable, and not a windfall, in the context of any given case,” and cautioned courts against lowering requested attorneys' fees unless it is “truly clear that the fee is unearned by counsel.” Id. at 849. The Second Circuit emphasized the importance of “encouraging truly good lawyers to take on” social security disability cases. Id.
Having carefully reviewed the petition, the requested attorneys' fees are reasonable. The amount requested does not exceed 25% of the benefits awarded and therefore falls within the 25% cap, and there is no evidence of fraud or overreaching by the attorney in making the agreement for fees with Plaintiff.
The SSA's guidance on windfall offsets is proper here. Where a motion for attorneys' fees under Section 406(b) involves concurrent claims for DIB and SSI benefits, Section 1127(a) of the Social Security Act, 42 U.S.C. § 1320a-6(a), requires that either DIB or SSI benefits be reduced by the amount of SSI benefits that would not have been paid if benefits had been paid when they were due. See Program Operations Manual (“POMS”) GN 02610.005 Introduction to Title II/Title XVI Windfall Offset. Here, the SSA informed the Court that the SSA's Center for Disability and Program Support advised there was no amount left for SSI representative fee consideration after the SSI past due benefits amount were reduced by the DIB offset. (ECF No. 35.) Petitioner does not object to this calculation.
Further, in considering the Fields factors, there is no evidence of a windfall. Petitioner is an experienced attorney who has successfully represented numerous social security claimants in this District. Petitioner's de facto hourly rate of $653.20 is within the range generally approved for this type of matter. See, e.g., Baron v. Astrue, 311 F.Supp.3d 633, 637 (S.D.N.Y. 2018) (collecting social security cases approving as reasonable hourly rates in the range of $1,000-2,100). The number of hours spent on this case is also reasonable and can be considered an efficient use of attorney time. See Derosa v. Comm'r of Soc. Sec., 2022 WL 3646202, at *2 (S.D.N.Y. Aug. 24, 2022) (finding that 33.7 hours of billed work was an efficient use of attorney time). Moreover, Petitioner achieved a favorable decision from the SSA on behalf of his client, amounting to a “satisfying result.” Fields, 24 F.4th at 855 (explaining that where the claimant achieved a fully favorable decision from the SSA, this weighed against a finding of a windfall, even where the de facto hourly rate was high). It was also uncertain that this case would result in an award of benefits at the time Petitioner agreed to represent Plaintiff, and given the risk of non-recovery, this is not a case involving an “unearned advantage” amounting to a windfall. Id.
Finally, although Petitioner was previously awarded attorneys' fees pursuant to the EAJA, these fees will be refunded to Plaintiff.
CONCLUSION
For the above reasons, I recommend authorizing an award of attorneys' fees of $15,219.50 and ordering that Petitioner refund the attorneys' fees previously received under the EAJA to Plaintiff upon Petitioner's receipt of payment.
SO ORDERED.
NOTICE
The parties shall have fourteen days from the service of this Report and Recommendation to file written objections to the Report and Recommendation, pursuant to 28 U.S.C. § 636(b)(1) and Rule 72(b) of the Federal Rules of Civil Procedure. See also Fed.R.Civ.P. 6(a), (d) (adding three additional days only when service is made under Fed.R.Civ.P. 5(b)(2)(C) (mail), (D) (leaving with the clerk), or (F) (other means consented to by the parties)).
A party may respond to another party's objections after being served with a copy. Fed.R.Civ.P. 72(b)(2). If any party files written objections to this Report and Recommendation, the other party shall have fourteen days to serve and file a response. Such objections shall be filed with the Clerk of the Court, with courtesy copies delivered to the chambers of the Honorable Jesse M. Furman at the United States Courthouse, 40 Foley Square, New York, New York 10007, and to any opposing parties. See 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 6(a), 6(d), 72(b). Any requests for an extension of time for filing objections must be addressed to Judge Furman. The failure to file these timely objections will result in a waiver of those objections for purposes of appeal. See 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 6(a), 6(d), 72(b); Thomas v. Arn, 474 U.S. 140 (1985).