1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 FOR THE EASTERN DISTRICT OF CALIFORNIA 9 10 ANTHONY J. DeSTEFANO, No. 2:22-cv-01338-SCR 11 Plaintiff, 12 v. ORDER 13 COMMISSIONER OF SOCIAL SECURITY, 14 15 Defendant. 16 17 In this action, Plaintiff sought judicial review of a final decision of the Commissioner of 18 Social Security (“Commissioner”) denying his application for benefits under the Social Security 19 Act. On September 19, 2023, Magistrate Judge Barnes granted Plaintiff’s motion for summary 20 judgment and entered judgment remanding this action to the Commissioner for further 21 proceedings. ECF Nos. 19 & 20. On remand, Plaintiff was awarded past benefits of over 22 $100,000.1 23 Now pending before the Court is Plaintiff’s December 30, 2024 Motion for an award of 24 attorney’s fees pursuant to 42 U.S.C. § 406(b). ECF No. 26. The Commissioner has filed a 25 statement that she “neither supports nor opposes counsel’s request for attorney’s fees.” ECF No. 26
27 1 The Notice of Award states that Plaintiff would be paid $114,355.62 as “the money you are due through May 2024.” ECF No. 26-2 at 2. The Notice further states: “We withheld $42,412.18 28 from your past due benefits in case we need to pay your representative.” ECF No. 26-2 at 3. 1 29 at 2. The Commissioner requests that the order direct Plaintiff’s counsel to reimburse Plaintiff 2 any fees previously received under the Equal Access to Justice Act (EAJA). Id. at 2. For the 3 reasons set forth below, the Motion will be granted. 4 I. REASONABLENESS OF FEE REQUEST 5 At the outset of the representation, Plaintiff and her counsel entered into a contingent-fee 6 agreement. ECF No. 26-3. Pursuant to that agreement Plaintiff’s counsel now seeks attorney’s 7 fees in the amount of $28,400.00 which represents less than 25% of the retroactive disability 8 benefits awarded to Plaintiff on remand. ECF No. 26 at 1. 9 Attorneys are entitled to fees for cases in which they have successfully represented social 10 security claimants: 11 Whenever a court renders a judgment favorable to a claimant under this subchapter who was represented before the court by an attorney, 12 the court may determine and allow as part of its judgment a reasonable fee for such representation, not in excess of 25 percent of 13 the total of the past-due benefits to which the claimant is entitled by reason of such judgment, and the Commissioner of Social Security 14 may . . . certify the amount of such fee for payment to such attorney out of, and not in addition to, the amount of such past-due benefits. 15 42 U.S.C. § 406(b)(1)(A). “In contrast to fees awarded under fee-shifting provisions such as 42 16 U.S.C. § 1988, the fee is paid by the claimant out of the past-due benefits awarded; the losing 17 party is not responsible for payment.” Crawford v. Astrue, 586 F.3d 1142, 1147 (9th Cir. 2009) 18 (en banc) (citing Gisbrecht v. Barnhart, 535 U.S. 789, 802 (2002)). The goal of fee awards under 19 § 406(b) is “to protect claimants against inordinately large fees and also to ensure that attorneys 20 representing successful claimants would not risk nonpayment of [appropriate] fees.” Parrish v. 21 Comm'r of Soc. Sec. Admin., 698 F.3d 1215, 1217 (9th Cir. 2012) (cleaned up). 22 The 25% statutory maximum fee is not an automatic entitlement, and the court must 23 ensure that the fee requested is reasonable. Gisbrecht, 535 U.S. at 808-09 (“406(b) does not 24 displace contingent-fee agreements within the statutory ceiling; instead, § 406(b) instructs courts 25 to review for reasonableness fees yielded by those agreements”). “Within the 25 percent 26 boundary . . . the attorney for the successful claimant must show that the fee sought is reasonable 27 for the services rendered.” Id. at 807. “[A] district court charged with determining a reasonable 28 1 fee award under § 406(b)(1)(A) must respect ‘the primacy of lawful attorney-client fee 2 arrangements,’ ‘looking first to the contingent-fee agreement, then testing it for reasonableness.’” 3 Crawford, 586 F.3d at 1149 (quoting Gisbrecht, 535 U.S. at 793, 808). 4 In determining whether the requested fee is reasonable, the court considers “‘the character 5 of the representation and the results achieved by the representative.’” Crawford, 586 F.3d 6 at 1151 (quoting Gisbrecht, 535 U.S. at 808). In determining whether a reduction in the fee is 7 warranted, the court considers whether the attorney provided “substandard representation or 8 delayed the case,” or obtained “benefits that are not in proportion to the time spent on the case.” 9 Id. Finally, the court considers the attorney’s record of hours worked and counsel’s regular 10 hourly billing charge for non-contingent cases. Crawford, 586 F.3d at 1151-52 (citing Gisbrecht, 11 535 U.S. at 808); see also, E.D. Cal. R. 293(c)(1) (in fixing attorney’s fees the court considers 12 “the time and labor required”). Below, the Court will consider these factors in assessing whether 13 the fee requested by counsel in this case pursuant to 42 U.S.C. § 406(b) is reasonable. 14 Here, Plaintiff’s counsel is an experienced attorney who has been practicing in this field 15 since the 1980s and secured a successful result for Plaintiff. ECF No. 26 at 9. There is no 16 indication that a reduction of fees is warranted due to any substandard performance by counsel. 17 There is also no evidence that Plaintiff’s counsel engaged in any dilatory conduct resulting in 18 excessive delay. The Court finds that the $28,400 fee, which does not exceed 25% of the amount 19 paid in past-due benefits to Plaintiff, is not excessive in relation to the benefits awarded. In 20 making this determination, the court recognizes the contingent fee nature of this case and 21 counsel’s assumption of the risk of going uncompensated in agreeing to represent Plaintiff on 22 such terms. See Crawford, 586 F.3d at 1152 (“[t]he attorneys assumed significant risk in 23 accepting these cases, including the risk that no benefits would be awarded or that there would be 24 a long court or administrative delay in resolving the cases”). 25 Counsel has submitted a billing statement in support of the requested fee. ECF No. 26 at 26 5-7. The Court finds that the amount of time expended (36.25 hours) is reasonable, although as 27 counsel acknowledges it is “toward the higher side” for these types of cases. ECF No. 26 at 7; 28 see also Costa v. Commissioner, 690 F.3d 1132, 1136 (9th Cir. 2012) (“Many district courts have 1 noted that twenty to forty hours is the range most often requested and granted in social security 2 cases.”). The Court notes that the effective hourly rate of $783.45/hour is in line with recent 3 awards in this District. See Garcia v. O’Malley, 2024 WL 4121872 (E.D. Cal. September 9, 4 2024) (effective hourly rate of $685); Guzman Paz v. Commissioner, 2024 WL 4029592 (E.D. 5 Cal. September 3, 2024) (effective hourly rate of $883); Garcia v. Commissioner, 2024 WL 6 3968083 (E.D. Cal. August 28, 2024) (effective hourly rate of $864). The effective hourly rate is 7 also similar to that approved by other courts.
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1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT 8 FOR THE EASTERN DISTRICT OF CALIFORNIA 9 10 ANTHONY J. DeSTEFANO, No. 2:22-cv-01338-SCR 11 Plaintiff, 12 v. ORDER 13 COMMISSIONER OF SOCIAL SECURITY, 14 15 Defendant. 16 17 In this action, Plaintiff sought judicial review of a final decision of the Commissioner of 18 Social Security (“Commissioner”) denying his application for benefits under the Social Security 19 Act. On September 19, 2023, Magistrate Judge Barnes granted Plaintiff’s motion for summary 20 judgment and entered judgment remanding this action to the Commissioner for further 21 proceedings. ECF Nos. 19 & 20. On remand, Plaintiff was awarded past benefits of over 22 $100,000.1 23 Now pending before the Court is Plaintiff’s December 30, 2024 Motion for an award of 24 attorney’s fees pursuant to 42 U.S.C. § 406(b). ECF No. 26. The Commissioner has filed a 25 statement that she “neither supports nor opposes counsel’s request for attorney’s fees.” ECF No. 26
27 1 The Notice of Award states that Plaintiff would be paid $114,355.62 as “the money you are due through May 2024.” ECF No. 26-2 at 2. The Notice further states: “We withheld $42,412.18 28 from your past due benefits in case we need to pay your representative.” ECF No. 26-2 at 3. 1 29 at 2. The Commissioner requests that the order direct Plaintiff’s counsel to reimburse Plaintiff 2 any fees previously received under the Equal Access to Justice Act (EAJA). Id. at 2. For the 3 reasons set forth below, the Motion will be granted. 4 I. REASONABLENESS OF FEE REQUEST 5 At the outset of the representation, Plaintiff and her counsel entered into a contingent-fee 6 agreement. ECF No. 26-3. Pursuant to that agreement Plaintiff’s counsel now seeks attorney’s 7 fees in the amount of $28,400.00 which represents less than 25% of the retroactive disability 8 benefits awarded to Plaintiff on remand. ECF No. 26 at 1. 9 Attorneys are entitled to fees for cases in which they have successfully represented social 10 security claimants: 11 Whenever a court renders a judgment favorable to a claimant under this subchapter who was represented before the court by an attorney, 12 the court may determine and allow as part of its judgment a reasonable fee for such representation, not in excess of 25 percent of 13 the total of the past-due benefits to which the claimant is entitled by reason of such judgment, and the Commissioner of Social Security 14 may . . . certify the amount of such fee for payment to such attorney out of, and not in addition to, the amount of such past-due benefits. 15 42 U.S.C. § 406(b)(1)(A). “In contrast to fees awarded under fee-shifting provisions such as 42 16 U.S.C. § 1988, the fee is paid by the claimant out of the past-due benefits awarded; the losing 17 party is not responsible for payment.” Crawford v. Astrue, 586 F.3d 1142, 1147 (9th Cir. 2009) 18 (en banc) (citing Gisbrecht v. Barnhart, 535 U.S. 789, 802 (2002)). The goal of fee awards under 19 § 406(b) is “to protect claimants against inordinately large fees and also to ensure that attorneys 20 representing successful claimants would not risk nonpayment of [appropriate] fees.” Parrish v. 21 Comm'r of Soc. Sec. Admin., 698 F.3d 1215, 1217 (9th Cir. 2012) (cleaned up). 22 The 25% statutory maximum fee is not an automatic entitlement, and the court must 23 ensure that the fee requested is reasonable. Gisbrecht, 535 U.S. at 808-09 (“406(b) does not 24 displace contingent-fee agreements within the statutory ceiling; instead, § 406(b) instructs courts 25 to review for reasonableness fees yielded by those agreements”). “Within the 25 percent 26 boundary . . . the attorney for the successful claimant must show that the fee sought is reasonable 27 for the services rendered.” Id. at 807. “[A] district court charged with determining a reasonable 28 1 fee award under § 406(b)(1)(A) must respect ‘the primacy of lawful attorney-client fee 2 arrangements,’ ‘looking first to the contingent-fee agreement, then testing it for reasonableness.’” 3 Crawford, 586 F.3d at 1149 (quoting Gisbrecht, 535 U.S. at 793, 808). 4 In determining whether the requested fee is reasonable, the court considers “‘the character 5 of the representation and the results achieved by the representative.’” Crawford, 586 F.3d 6 at 1151 (quoting Gisbrecht, 535 U.S. at 808). In determining whether a reduction in the fee is 7 warranted, the court considers whether the attorney provided “substandard representation or 8 delayed the case,” or obtained “benefits that are not in proportion to the time spent on the case.” 9 Id. Finally, the court considers the attorney’s record of hours worked and counsel’s regular 10 hourly billing charge for non-contingent cases. Crawford, 586 F.3d at 1151-52 (citing Gisbrecht, 11 535 U.S. at 808); see also, E.D. Cal. R. 293(c)(1) (in fixing attorney’s fees the court considers 12 “the time and labor required”). Below, the Court will consider these factors in assessing whether 13 the fee requested by counsel in this case pursuant to 42 U.S.C. § 406(b) is reasonable. 14 Here, Plaintiff’s counsel is an experienced attorney who has been practicing in this field 15 since the 1980s and secured a successful result for Plaintiff. ECF No. 26 at 9. There is no 16 indication that a reduction of fees is warranted due to any substandard performance by counsel. 17 There is also no evidence that Plaintiff’s counsel engaged in any dilatory conduct resulting in 18 excessive delay. The Court finds that the $28,400 fee, which does not exceed 25% of the amount 19 paid in past-due benefits to Plaintiff, is not excessive in relation to the benefits awarded. In 20 making this determination, the court recognizes the contingent fee nature of this case and 21 counsel’s assumption of the risk of going uncompensated in agreeing to represent Plaintiff on 22 such terms. See Crawford, 586 F.3d at 1152 (“[t]he attorneys assumed significant risk in 23 accepting these cases, including the risk that no benefits would be awarded or that there would be 24 a long court or administrative delay in resolving the cases”). 25 Counsel has submitted a billing statement in support of the requested fee. ECF No. 26 at 26 5-7. The Court finds that the amount of time expended (36.25 hours) is reasonable, although as 27 counsel acknowledges it is “toward the higher side” for these types of cases. ECF No. 26 at 7; 28 see also Costa v. Commissioner, 690 F.3d 1132, 1136 (9th Cir. 2012) (“Many district courts have 1 noted that twenty to forty hours is the range most often requested and granted in social security 2 cases.”). The Court notes that the effective hourly rate of $783.45/hour is in line with recent 3 awards in this District. See Garcia v. O’Malley, 2024 WL 4121872 (E.D. Cal. September 9, 4 2024) (effective hourly rate of $685); Guzman Paz v. Commissioner, 2024 WL 4029592 (E.D. 5 Cal. September 3, 2024) (effective hourly rate of $883); Garcia v. Commissioner, 2024 WL 6 3968083 (E.D. Cal. August 28, 2024) (effective hourly rate of $864). The effective hourly rate is 7 also similar to that approved by other courts. In Crawford, the Ninth Circuit found the fee awards 8 in the three consolidated cases to be reasonable, and the fee requests ranged from $11,500 to 9 $24,000, and if divided by the hours expended would have resulted in effective rates in the range 10 of $500 to $900/hour. 586 F.3d at 1145-1147. 11 Accordingly, for the reasons stated above, the court concludes that the fees sought by 12 counsel pursuant to § 406(b) are reasonable. 13 II. OFFSET FOR EAJA FEES 14 An award of § 406(b) fees must be offset by any prior award of attorney’s fees granted 15 under the EAJA. 28 U.S.C. § 2412; Gisbrecht, 535 U.S. at 796. Here, Plaintiff’s attorney was 16 previously awarded $8,400.00 in EAJA fees. See ECF No. 23. Counsel therefore must remit that 17 amount to Plaintiff. 18 Accordingly, IT IS HEREBY ORDERED that: 19 1. Plaintiff’s Motion for attorney Fees under 42 U.S.C. § 406(b) (ECF No. 26), is 20 GRANTED; 21 2. Counsel for Plaintiff is awarded $28,400.00 in attorney’s fees under § 406(b); the 22 Commissioner shall certify that amount to be paid to counsel from the funds previously withheld 23 for the payment of such fees; and 24 3. The Commissioner shall pay to Plaintiff the remaining amount in past-due benefits 25 after payment of attorney’s fees from the $42,412.18 in funds previously withheld; and 26 //// 27 //// 28 //// 1 4. Counsel for Plaintiff is directed to remit to Plaintiff the amount of $8,400.00 for EAJA 2 || fees previously paid to counsel by the Commissioner. 3 | ORDERED: 4 | DATE: February 18, 2025 SEAN C. RIORDAN 7 UNITED STATES MAGISTRATE JUDGE 8 9 10 1] 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28