Holder v. Social Security Administration Commissioner, No. 2:2005cv03521 - Document 48 (D. Ariz. 2009)
Court Description: ORDER denying without prejudice (to renew upon compliance with the notice, service and filing requirements set forth herein) 45 Motion for Attorney Fees. Signed by Judge Robert C Broomfield on 5/6/09.(MAP)
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Holder v. Social Security Administration Commissioner 1 Doc. 48 WO 2 3 4 5 6 7 IN THE UNITED STATES DISTRICT COURT 8 FOR THE DISTRICT OF ARIZONA 9 10 11 12 Jill T. Holder, 13 Plaintiff, 14 15 16 vs. Michael J. Astrue,1 Commissioner of the Social Security Administration, 17 Defendant. ) ) ) ) ) ) ) ) ) ) ) ) No. CIV 05-3521-PHX-RCB O R D E R 18 19 Currently pending before the court is a motion by plaintiff’s 20 attorney, Scott E. Davis, for his fees pursuant to 42 U.S.C. 21 § 406(b) (doc. 45). 22 “trustee” role,2 “inform[s] the Court of his analysis of this fee The defendant SSA Commissioner, in his quasi- 23 1 24 25 26 27 28 In accordance with Fed. R. Civ. P. 25(d), which allows for substitution when, among other reasons, “a public officer who is a party in an official capacity . . . ceases to hold office while the action is pending[,]” the court hereby substitutes Michael J. Astrue, who was confirmed as the Commissioner of the Social Security Administration (“SSA”) on February 1, 2007, for Jo Anne B. Barnhart, the former Commissioner. 2 See Gisbrecht v. Barnhart, 535 U.S. 789, 798 n. 6, 122 S.Ct. 1817, 152 L.Ed.2d 996 (2002) (noting that although “the [SSA] Commissioner . . . has no direct financial stake in the answer to the § 406(b) question[,] . . . []he plays a part in the fee determination resembling that of a trustee for the claimants[]”). Dockets.Justia.com 1 request[,]” but beyond that expressly “takes no further action.” 2 See “Defendant’s Statement to Plaintiff’s Counsel’s Motion[]” 3 (“Def. Stmt.”) (doc. 47) at 9:12-15. 4 below, because it appears that plaintiff Holder has not been served 5 with this fee motion, and because the record does not include a 6 copy of the contingency fee agreement, the court denies this motion 7 without prejudice. As more fully explained 8 Background 9 There is no dispute that plaintiff’s attorney successfully 10 obtained $33,150.00 in past due benefits for plaintiff Holder. 11 Memo. (doc. 46), exh. A thereto (doc. 46-2) at 1. 12 is no dispute that in the SSA’s Notice of Award to plaintiff, it 13 advised that her “lawyer may ask the court to approve a fee no 14 larger than 25 percent of past due benefits.” 15 (doc. 46-2) at 2 (emphasis added). 16 plaintiff that for that reason, it was “withholding $13,602.85[]” 17 from her past-due benefits. 18 the fee,” the SSA also advised plaintiff that it would “let [her] 19 and the lawyer know how much of th[at] money will be used to pay 20 the fee.” 21 See id. 22 Id. Id. See Likewise, there Id., exh. A thereto The SSA further informed Explaining that “the court sets Plaintiff will then be receiving the remainder. The motion itself indicates that plaintiff’s attorney is 23 seeking the $13,602.85, which the SSA’s Notice mentions. 24 (doc. 45) at 1:16. 25 requests only $9,302.85. 26 requested amount is the difference between the withheld amount of 27 $13,602.85, and the $4,300.00 in fees which this court previously 28 approved under the Equal Access to Justice Act (“EAJA”). See Mot. In his supporting memorandum, however, he Memo. (doc. 46) at 1:20. -2- The lower Memo. 1 (doc. 46) at 2:1-4. 2 is petitioning the court “only for the amount remaining after the 3 EAJA offset, and requests that any amounts remaining after payment 4 of the section 406(b) attorney’s fee be refunded directly to 5 Plaintiff.” Indeed, plaintiff’s attorney stresses that he Id. at 4:1-3 (emphasis in original). 6 Legal Framework 7 In contrast to section 406(a) of the Social Security Act, 8 which “governs [attorneys’] fees for representation in 9 administrative proceedings[,]” section 406(b) of that Act “controls 10 [such] fees for representation in court.” 11 794 (citing 20 C.F.R. § 404.1728(a)(2001)). 12 “[a]s part of its judgment, a court may allow ‘a reasonable fee 13 . . . not in excess of 25 percent of the . . . past-due benefits’ 14 awarded to the claimant.” 15 § 406(b)(1)(A)). 16 award thereunder be payable “out of, and not in addition to, the 17 amount of [the] past due benefits.” 42 U.S.C. § 406(b)(1)(A). 18 other words, a denial of benefits results in no fee award. 19 at 795. 20 on a claimant’s continuing entitlement to benefits.” 21 535 U.S. at 795. 22 attorney to gain more than that [statutory] fee, or to charge the 23 claimant a noncontingent fee, is a criminal offense.” 24 806-07 (citing 42 U.S. § 406(b)(2); 20 C.F.R. § 404.1740(c)(2) 25 (2001)). 26 Gisbrecht, 535 U.S. at Under section 406(b), Id. at 795 (quoting 42 U.S.C. That statute expressly provides that any fee In See id. Similarly, “attorneys may not gain additional fees based Gisbrecht, Not only that, “any endeavor by the claimant’s Id. at Based upon this statutory framework, in resolving a “division 27 among the Circuits on the appropriate method of calculating fees 28 under § 406(b)[,]” the Supreme Court in Gisbrecht “conclude[d]” -3- 1 that that statute “does not displace contingent-fee agreements as 2 the primary means by which fees are set for successfully 3 representing Social Security benefits claimants in court.” 4 807. 5 for court review of such arrangements as an independent check, to 6 assure that they yield reasonable results in particular cases.” 7 Id. (footnote omitted). 8 boundary line[]” for reviewing section 406(b) fee arrangements, the 9 Gisbrecht Court reiterated that such arrangements “are Id. at “Rather,” according to the Gisbrecht Court, “§ 406(b) calls Observing that “Congress has provided one 10 unenforceable to the extent that they provide for fees exceeding 25 11 percent of the past-due benefits.” 12 (citing § 406(b)(1)(A) (1994 ed., Supp. V)) (footnote omitted). 13 At the same time, however, “[w]ithin th[at] 25 percent boundary, 14 . . . , the attorney for the successful claimant must show that the 15 fee sought is reasonable for the services rendered.” Id. (citation 16 and footnote omitted). 17 Gisbrecht, 535 U.S. at 807 “Section 406(b) . . . requires the court to determine whether 18 a fee agreement has been executed between the plaintiff and [her] 19 attorney[.]” 20 April 15, 2009) (internal quotation marks omitted) (emphasis added) 21 (citing, inter alia, Gisbrecht, 535 U.S. at 807). 22 step is to determine “whether such agreement is reasonable.” 23 (citing, inter alia, Gisbrecht, 535 U.S. at 807). 24 that reasonableness assessment, the Gisbrecht Court identified a 25 number of relevant factors: the attorney’s risk of loss; “the 26 character of the representation and the results . . . achieved[;]” 27 delay by counsel; and the amount of the benefits “in comparison to 28 the amount of time counsel spent on the case[.]” Gisbrecht, 535 Brandenburg v. Astrue, 2009 WL 1138088, at *2 (D.Or. -4- If so, the next Id. In performing 1 U.S. at 808. 2 Court in Gisbrecht seemed to give district courts a great deal of 3 latitude, noting that those courts “are accustomed to making 4 reasonableness determinations in a wide variety of contexts, and 5 their assessments in such matters, in the event of an appeal, 6 ordinarily qualify for highly respectful review.” No one factor is dispositive. 7 8 9 Indeed, the Supreme Id. at 808. Discussion Plaintiff’s attorney recognizes that “[t]he starting point” under Gisbrecht “is the contingent-fee request in light of the 10 contingent-fee agreement.” 11 omitted). 12 states in his memorandum that “[p]laintiff contracted to pay 25% of 13 past-due benefits on a contingent-fee basis.” 14 Plaintiff then refers the court to the “contingent-fee agreement 15 attached [t]hereto as Exhibit ‘B’.” Id. at 5:16-17. 16 however, that fee agreement was not attached as exhibit B – or at 17 all, for that matter. 18 Memo. (doc. 46) at 5:14-15 (footnote Consistent with that recognition, plaintiff’s attorney Id. at 5:15-16. Inadvertently, The Commissioner does not dispute the terms of that fee 19 agreement, but he does accurately note that a copy of that 20 agreement is not before the court. 21 agreement as “essential” to resolving the fee claim, the 22 Commissioner believes that the court should require plaintiff’s 23 attorney to provide a copy of that agreement, before deciding this 24 motion. 25 Viewing provision of that Def. Stmt. (doc. 47) at 2:6. At the outset, the court stresses that it has no reason to 26 doubt the veracity of plaintiff’s attorney. 27 signed the supporting memorandum of law, in accordance with Fed. R. 28 Civ. P. 11(b)(3), the court assumes that there is evidentiary -5- Indeed, because he 1 support for his statement as to the existence of a contingency fee 2 agreement and its terms. 3 circumstances of this case, the court will require plaintiff’s 4 attorney to follow the court’s preferred practice which, as he 5 clearly intended, is to include the fee agreement as part of the 6 record. 7 beyond the threshold Gisbrecht inquiry, which is “to determine 8 whether a fee agreement has been executed between the plaintiff and 9 [her] attorney[.]” See Brandenburg, 2009 WL 1138088, at *2 10 11 Nonetheless, under the particular Without a copy of that fee agreement, the court cannot get (internal quotation marks and citations omitted). What is of more concern to the court, however, is that it 12 appears that plaintiff Holder was not served with a copy of this 13 motion - a factor which the Commissioner also mentions. 14 Certificate of Service only indicates electronic filing upon local 15 and regional counsel for the SSA. 16 Obviously, if plaintiff’s attorney prevails on any aspect of this 17 fee motion, it will directly impact plaintiff as those fees are 18 payable directly from her past-due benefits. 19 that in the Notice of Award which it issued to plaintiff, the SSA 20 has previously advised her of the possibility of a fee award from 21 her past-due benefits. 22 plaintiff was not advised by the SSA or by plaintiff’s attorney, 23 that he is, in fact, requesting the court to approve a fee payment 24 from her past-due benefits. 25 The See Memo. (doc. 46) at 9. The court realizes To the court’s knowledge, however, “There is no question but that, when making section 406(b) 26 applications,” as here, “attorneys are required to give notice to 27 their clients as to the existence of such application.” 28 v. Heckler, 608 F.Supp. 1255, 1260 (D.N.J. 1985) (citing, inter -6- See Taylor 1 alia, 20 C.F.R. § 404.1725(a)(7)) (emphasis added); see also 2 Robinson v. Secretary of Health, Education and Welfare, 456 F.Supp. 3 876, 878 (E.D. Mich. 1978) (“Basic fairness requires that when an 4 attorney claims to be entitled to money that would otherwise go to 5 that attorney’s client, the attorney should be required to notify 6 the client of his claim.”). 7 of the Robinson court that “[i]n the vast majority of cases there 8 will undoubtedly be no disagreement between the client and the 9 attorney.” The court agrees with the observations Robinson, 456 F.Supp. at 878. “But when there is, the 10 court needs to know about the disagreement in order to be able to 11 make an informed decision.” 12 Id. In light of the foregoing, and because the court believes that 13 it comports with fundamental notions of due process, before 14 considering the merits, the court will require plaintiff’s attorney 15 to serve plaintiff Jill T. Holder with a renewed motion for 16 attorney’s fees, a supporting memorandum of law, and all necessary 17 supporting documentation, including a copy of the contingent fee 18 agreement. 19 to the court and to opposing counsel. 20 also must be filed and served in accordance with the applicable 21 rules. Upon renewal, proof of such service shall be provided Plainly any renewed motion 22 For the reasons set forth above, IT IS ORDERED that: 23 “Plaintiff’s Attorney’s Motion for Award of Attorney’s Fees 24 Under 42 U.S.C. § 406(b)” (doc. 45) is DENIED without prejudice to 25 . . . 26 27 28 -7- 1 renew upon compliance with the notice, service and filing 2 requirements set forth herein. 3 DATED this 6th day of May, 2009. 4 5 6 7 8 9 10 11 Copies to counsel of record 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 -8-
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