Elawyers Elawyers
Ohio| Change

Castro v. Commissioner of Social Security Administration, 15 CV 1459 (NSR)(LMS). (2018)

Court: District Court, S.D. New York Number: infdco20181009e74 Visitors: 3
Filed: Sep. 12, 2018
Latest Update: Sep. 12, 2018
Summary: REPORT AND RECOMMENDATION LISA MARGARET SMITH , Magistrate Judge . TO: THE HONORABLE NELSON S. ROMAN, U.S.D.J. Plaintiff, Alexis Castro, has moved for an award of attorneys' fees pursuant to the Social Security Act, 42 U.S.C. 406(b)(1). ECF No. 26. Defendant, the Commissioner of Social Security, agrees that Plaintiff's request for attorneys' fees is reasonable, but opposes the motion on the ground that Plaintiff's award of benefits was not directly achieved by Plaintiff's counsel in the
More

REPORT AND RECOMMENDATION

TO: THE HONORABLE NELSON S. ROMAN, U.S.D.J.

Plaintiff, Alexis Castro, has moved for an award of attorneys' fees pursuant to the Social Security Act, 42 U.S.C. § 406(b)(1). ECF No. 26. Defendant, the Commissioner of Social Security, agrees that Plaintiff's request for attorneys' fees is reasonable, but opposes the motion on the ground that Plaintiff's award of benefits was not directly achieved by Plaintiff's counsel in the action. For the reasons that follow, I respectfully report and recommend granting Plaintiff's motion for attorneys' fees.

BACKGROUND

On April 30, 2012, Plaintiff filed an application for Supplemental Security Income ("SSI") benefits alleging a disability onset date of April 24, 2012. Plaintiff's Affirmation ("P1's Aff."), at 1 ¶ 1. Plaintiff's application was denied and he thereafter requested a hearing before an Administrative Law Judge ("All") on June 20, 2012. Id. On April 26, 2013, a hearing was held before ALJ Michael Friedman, resulting in an unfavorable decision dated May 10, 2013, finding Plaintiff not disabled. Id. ¶ 2. On June 12, 2013, Plaintiff requested that the Appeals Council review ALJ Friedman's decision. Id.

On August 15, 2013, Plaintiff retained Binder & Binder, The National Social Security Disability Advocates, LLC ("Binder & Binder"), to represent him to pursue disability benefits. Id. On November 11, 2014, in support of Plaintiff's appeal, Binder & Binder submitted comments to the Appeals Council. Id. On December 30, 2014, the Appeals Council denied Plaintiff's request for review. Id.

On February 19, 2015, Plaintiff executed a "U.S. District Court Retainer Agreement and Assignment" (the "Retainer Agreement"), which authorized the Law Offices of Charles E. Binder and Harry J. Binder, LLP (f/k/a Law Offices—Harry J. Binder and Charles E. Binder, PC) (the "Law Offices") to appeal the denial of benefits to the United States District Court. Id. at 2 ¶ 3. Specifically, the Retainer Agreement provided that

If the case is remanded by the United States District Court to the Social Security Administration for review or additional testimony, and [Plaintiff is] awarded past due benefits by the Appeals Council or an [AU] after an additional hearing, the law firm may apply for fees to Ethel U.S. District Court under § 406. These fees will not exceed 25% of the back due benefits due [to Plaintiff and his] family. Fees will be approved by the U.S. District Court pursuant to § 406(b) of the Social Security Act.

Id. at Ex. A ¶ II. The Law Offices provided legal services to Plaintiff in pursuing benefits in the District Court and Binder & Binder provided legal services to Plaintiff before the Social Security Administration (the "Agency" or "SSA"). Id. at 2 ¶ 3.2

On September 3, 2015, Plaintiff, by and through his attorney, commenced the instant lawsuit pursuant to 42 U.S.C. § 405(g), seeking review of the final determination of the Commissioner denying his application for SSI benefits. ECF No. 1; Pl's Aff., at 2 ¶ 4. On January 7, 2016, by way of a stipulation and order of remand, the case was remanded to the SSA for further administrative proceedings. ECF No. 15; Pl's Aff, at 2 ¶ 4. On January 8, 2016, judgment was entered remanding the matter to the Commissioner. ECF No. 17; Pl's Aff, at 2 ¶ 4,

On February 5, 2016, Plaintiff filed a motion pursuant to the Equal Access to Justice Act ("EAJA"), 28 U.S.C. § 2412, seeking attorneys' fees and reimbursement of costs for the district court filing fee payable from the judgment fund pursuant to 31 U.S.C. § 1304. ECF No. 18; Pl's Aff, at 2 ¶ 5. On March 18, 2016, the parties stipulated that Defendant would pay Plaintiff $4,700.00 in attorneys' fees and $400.00 in reimbursement costs. ECF No. 23; Pl's Aff, at 2 ¶ 5.

On October 30, 2017, in accordance with the stipulation and order of remand, a second administrative hearing was held before AU Selwyn S.C. Walters. Pl's Aff., at 2 ¶ 6. At that hearing Plaintiff amended his disability onset date to February 24, 2014. Id. In All Walter's January 16, 2018, favorable decision, Plaintiff was found disabled as of February 24, 2014. Id. at 2-3 ¶ 6.

On July 18, 2018, Plaintiff filed the instant motion seeking an award of $8,780.50 in attorneys' fees, as contemplated by Plaintiff's retainer agreement, which represents twenty-five percent (25%) of the past-due benefits awarded to Plaintiff. ECF No, 26. Plaintiff's past-due benefits from March 2014 through February 2018 totaled $35,032.00, and $8,780.50 was withheld by the SSA from Plaintiff's past-due benefits for payment of legal fees. Pl's Aft, at 4 ¶ 12; Ex. C.3 Plaintiff's counsel acknowledges that because he was previously awarded $4,700.00 under the EAJA, should recovery under 42 U.S.C. § 406(b)(1) be awarded, Plaintiff's counsel will refund the lesser of the two fees directly to Plaintiff. Id. at 4-5 ¶ 13.

DISCUSSION

The Social Security Act provides that "[w]henever a court renders a judgment favorable to a claimant . . . who was represented before the court by an attorney, the court may determine and allow as part of its judgment a reasonable fee for such representation, not in excess of 25 percent of the total past-due benefits to which the claimant is entitled by reason of such judgment. . . ." 42 U.S.C. § 406(b)(1)(A). "In detetniining whether to award fees, a district court looks first to the contingent fee agreement between the parties." Curto v. Astrue, No. 07-CV-3711 (DLC), 2010 WL 1047624, at *2 (S.D.N.Y. Mar. 22, 2010); see Gisbrecht v. Barnhart, 535 U.S. 789, 807-08 (2002). If the fee agreement or retainer provides for a fee within the 25 percent cap, as it does here, "the attorney for the successful claimant must show that the fee sought is reasonable for the services rendered." Gisbrecht, 535 U.S. at 807; see Wells v. Sullivan, 907 F.2d 367, 371 (2d Cir. 1990) ("[W]here there is a contingency fee agreement in a successful social security case, the district court's determination of a reasonable fee under § 406(b) must begin with the agreement, and the district court may reduce the amount called for by the contingency agreement only when it finds the amount to be unreasonable."). While "contingent fee agreements cannot simply be adopted as per se reasonable in all social security cases," courts recognize that "a contingency agreement is the freely negotiated expression both of a claimant's willingness to pay more than a particular hourly rate to secure effective representation, and of an attorney's willingness to take the case despite the risk of nonpayment." Wells, 907 F.2d at 370-71.

Factors considered by courts, in determining whether a contingency fee agreement seeks a reasonable fee, include whether: (1) "the contingency percentage is within the 25% cap," as set by statute; (2) "there has been fraud or overreaching in making the agreement"; and (3) "the requested amount is so large as to be a windfall to the attorney." McCown v. Barnhart, No. 06-CV-3981 (DAB)(KNF), 2009 WL 996391, at *3 (S.D.N.Y. Mar. 31, 2009), report and recommendation adopted sub nom. McCown v. Astrue, No. 06-CV-3981 (DAB), 2009 WL 1447683 (S.D.N.Y, May 21, 2009) (quoting Wells, 907 F.2d at 372). "`Courts . . . have appropriately reduced the attorney's recovery' based upon: (1) `the character of the representation and the results the representative achieved'; (2) whether the attorney created a delay in proceedings, since an attorney should `not profit from the accumulation of benefits during the pendency of the case in court' caused by such delay; and (3) whether the proposed attorney's fee is `large in comparison to the amount of time counsel spent on the case.'" McCown, 2009 WL 996391, at *3 (quoting Gisbrecht, 535 U.S. at 808) (emphasis added).

In the instant case, Defendant does not object to the reasonableness of the attorneys' fees requested by Plaintiff.4 Instead, the primary issue in dispute concerns the results that Plaintiff's counsel achieved. Specifically, Defendant alleges that "in light of Plaintiff's revised alleged onset date, and despite [Plaintiff's] counsel's unquestioned role securing an earlier remand, the later award of benefits that Plaintiff ultimately obtained arguably was not directly achieved by the representative in the action remanding the Commissioner's May 10, 2013[,] decision." Def's Opp'n, at 2-3.

This Court disagrees with Defendant's contention that Plaintiff's award of benefits was not directly achieved by Plaintiff's counsel in the federal action. In Kroll v. Berryhill, No. 13-CV-0816-A, 2018 WL 446217, at *1 (W.D.N.Y. Jan. 17, 2018), plaintiff's counsel filed a complaint and motion for judgment on the pleadings in federal court. Id. Thereafter, the parties stipulated that the case was to be remanded to the Commissioner, and on remand, the All issued a favorable decision. Id. The court awarded plaintiff reasonable attorneys' fees pursuant to 42 U.S.C. § 406(b). Similar to Kroll, Plaintiff's counsel initiated the instant litigation with the filing of a complaint. ECF No. 1. Thereafter, on January 7, 2016, Plaintiff and Defendant entered into a stipulation remanding the action to the Commissioner to conduct further administrative proceedings. ECF No. 15. The Clerk's judgment remanding same was filed one day later. ECF No. 17. Thereafter, Plaintiff's counsel handled the proceedings at the administrative level, eventually resulting in a finding that Plaintiff was disabled as of February 24, 2014, the amended alleged disability onset date. Pl's Aff., at 2-3 ¶ 6.

Defendant seems to argue that Plaintiff's award of benefits resulted from the further administrative action Plaintiff's counsel took in amending Plaintiff's alleged disability onset date. While this is true, it is also true that Plaintiff's counsel's decision to enter into a stipulation of remand was an act taken in the federal action that enabled Plaintiff to pursue an award of benefits again at the administrative level, eventually leading to a finding that Plaintiff was disabled. As the court in Kroll noted, "the parties' stipulation to remand is indicative of `the character of the representation and the results the representative achieved.'" Kroll, 2018 WL 446217, at *2 (quoting Gisbrecht, 535 U.S. at 808). Courts in this Circuit have awarded attorneys' fees under 42 U.S.C. § 406(b) in cases with the same or a similar procedural posture, namely filing a complaint in a district court, entering into a stipulation of remand, and undergoing further administrative proceedings resulting in a finding of disability for a plaintiff. See Torres v. Colvin, No. 11-CV-5309 (JGK), 2014 WL 909765, at *4 (S.D.N.Y. Mar. 6, 2014) ("There is no dispute that plaintiff's counsel achieved a favorable result for plaintiff by securing a remand to the administrative level, which eventually led to a substantial award of past-due benefits."); Benson v. Astrue, No. 04-CV-8358 (CM) (LMS), 2009 WL 82581, at *1 (S.D.N.Y. Jan. 6, 2009) (finding award of attorneys' fees appropriate under 42 U.S.C. § 406(b) where plaintiff filed a complaint and entered into stipulation of remand without any additional activity in the federal action). Accordingly, Plaintiff's counsel's initiation of the lawsuit and subsequent entering into a stipulation of remand were sufficient acts warranting Plaintiff's recovery of attorneys' fees under 42 U.S.C. § 406(b).

CONCLUSION

In light of the foregoing, I conclude, and respectfully recommend that Your Honor should conclude, that Plaintiff's counsel is entitled to recover $8,780.50, representing twenty-five (25%) of the past-due benefits awarded to Plaintiff Additionally, the funds should be made payable to the Law Offices of Charles E. Binder and Harry J. Binder, LLP. I further report, and respectfully recommend that Your Honor should conclude, that the attorneys' fees previously awarded to Plaintiff in the amount of $4,700.00 under the EAJA be directly refunded to Plaintiff upon Plaintiff's counsel's receipt of funds awarded under 42 U.S.C. § 406(b).

NOTICE

Pursuant to 28 U.S.C. § 636(b)(1), as amended, and Fed. R. Civ. P. 72(b), the parties shall have fourteen (14) days, plus an additional three (3) days, pursuant to Fed. R. Civ. P. 6(d), or a total of seventeen (17) days, see Fed. R. Civ. P. 6(a), from the date hereof, to file written objections to this Report and Recommendation. Such objections, if any, shall be filed with the Clerk of the Court, with extra copies delivered to the chambers of the Honorable Nelson S. Roman, at the United States District Court, Southern District of New York, 300 Quarropas Street, White Plains, New York, 10601, and to the chambers of the undersigned at the same address.

Failure to file timely objections to this Report and Recommendation will preclude later appellate review of any order of judgment that will be entered.

Requests for extensions of time to file objections must be made to Judge Roman.

FootNotes


1. Ms. Berryhill is the current Acting Commissioner of Social Security, effective January 20, 2017, and is automatically substituted herein as Defendant pursuant to Fed. R. Civ. P. 25(d).
2. Plaintiff's counsel submitted a "schedule of hours" detailing the work performed on Plaintiff's matter in federal court. Pl's Aff., Ex. B. Daniel S. Jones and Charles E. Binder expended a total of 29.2 hours between February 11, 2015, and January 25, 2016. Id.
3. Exhibit C is a notice from the SSA confirming Plaintiff's past-due benefits award was $35,032.00 for the period of March 2014 through February 2018. The notice did not indicate the anticipated legal fees award to be withheld from that amount. Accordingly, Plaintiff's counsel's office contacted the SSA and spoke with claims representative, Ms. Parker, who advised that the sum of $8,750.50 was withheld from Plaintiff's past-due benefits award for payment of legal fees. Pl's Aff., at 4 ¶ 13; Ex. C
4. Defendant stated that terms of the amount sought, the Government believes that the total fees sought by Plaintiff's counsel pursuant to 42 U.S.C. § 406(b) are reasonable under the factors set forth in Gisbrecht." Defendant's Opposition ("Def's Opp'n"), at 2.
Source:  Leagle

Can't find what you're looking for?

Post a free question on our public forum.
Ask a Question
Search for lawyers by practice areas.
Find a Lawyer