1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 DONALD M., Case No. 22-cv-01114-SI

8 Plaintiff,

ORDER GRANTING MOTION FOR

9 v. ATTORNEY’S FEES UNDER 42 U.S.C. § 406(b) 10 MARTIN O'MALLEY,1 Re: Dkt. No. 24 11 Defendant.

12 13 Now before the Court is a motion for attorney’s fees pursuant to 42 U.S.C. § 406(b). Dkt. 14 No. 24. Plaintiff’s counsel served a copy of the motion on plaintiff, and plaintiff filed two letters 15 with the Court asking for a reduction of the requested fees. Dkt. Nos. 27, 28. The Court ordered 16 plaintiff’s counsel to respond to the concerns raised in plaintiff’s letters, and counsel has filed a 17 response. Dkt. Nos. 29, 30. The Court has reviewed all of the filings, including plaintiff’s letters, 18 and has taken these into consideration. For the reasons explained below, the Court GRANTS the 19 motion for attorney’s fees in full. 20 21 BACKGROUND 22 Attorney Harvey Sackett represented plaintiff before this Court in appealing the denial of 23 his application for Disability Insurance Benefits under Title II of the Social Security Act. The parties 24 filed cross-motions for summary judgment. Dkt. Nos. 13, 16. On March 3, 2023, the Court issued 25 an order granting plaintiff’s motion, denying defendant’s motion, and remanding the case for further 26 administrative proceedings. Dkt. No. 20. On May 16, 2023, pursuant to stipulation, this Court 27 1 approved an award of $6,250.00 in attorney’s fees under the Equal Access to Justice Act (“EAJA”), 2 28 U.S.C. § 2412(d). Dkt. No. 23. That award was “without prejudice to the rights of Sackett and 3 Associates and/or Harvey P. Sackett to seek Social Security Act attorney fees under 42 U.S.C. 4 § 406(b), subject to the savings clause provisions of the EAJA.” Id. at 2. 5 Following remand, the Administrative Law Judge (“ALJ”) issued a fully favorable decision 6 and awarded plaintiff benefits, including retroactive benefits totaling $165,820.40. Dkt. No. 24 at 7 2; Dkt. No. 24-2. The Social Security Administration withheld $41,450.25 of the award, equal to 8 approximately 25 percent of the past-due benefits, in the event plaintiff’s counsel were to petition 9 for attorney’s fees. Id.; see also Dkt. No. 24-3; Dkt. No. 25 at 2. Counsel now seeks $29,000.00, 10 or roughly 17.5% of the past due benefits, in attorney’s fees from this Court. Dkt. No. 24 at 2. After 11 the required reimbursement to plaintiff of the $6,250.00 in EAJA fees, this would result in a net fee 12 to plaintiff’s counsel of $22,750.00 from the retroactive benefits.2 13 In support of the motion, plaintiff’s counsel submitted the Notice of Award, the fee 14 agreement with plaintiff, and a statement of attorney time expended for the work done at the district 15 court level. See Dkt. No. 24. The government takes no position on the fee request but asks that the 16 Court independently review whether counsel’s fee request is reasonable. Dkt. No. 25. As noted 17 above, plaintiff mailed two letters to the Court after his counsel filed the fee motion. See Dkt. Nos. 18 27, 28. The letters are addressed to ALJ Parnow and challenge the fee motion that counsel filed 19 with the administrative agency under 42 U.S.C. § 406(a). Plaintiff sent copies of these letters to this 20 Court. Even though the letters are not addressed to this Court directly, the Court has reviewed the 21 letters and taken plaintiff’s arguments into account when reviewing the current fee motion. It 22 appears from the filings that counsel is seeking $12,000.00 for his work at the administrative agency 23 level and $29,000.00 for his work at the judicial review level. Together, this totals just under 25% 24 of the past-due benefits. Plaintiff does not disagree that his attorney should be paid, but he does not 25 think his attorney’s performance justifies a full 25% of his past-due benefits. See Dkt. No. 28 at 2. 26 27 1 LEGAL STANDARD 2 The Social Security Act provides that when a plaintiff prevails on a judgment, the Court may 3 determine a reasonable fee for the plaintiff’s counsel, which can be no more than 25 percent of the 4 plaintiff’s entitlement to the total past-due benefits. 42 U.S.C. § 406(b)(1)(A). The Court must 5 review counsel’s request for fees “as an independent check” to assure that the contingency fee 6 agreement will “yield reasonable results in particular cases.” See Gisbrecht v. Barnhart, 535 U.S. 7 789, 807 (2002). Attorneys representing Social Security disability benefits claimants “routinely 8 enter into contingent-fee agreements specifying that the fee will be 25% of any past-due benefits 9 recovered, thus providing the attorney the statutory maximum of fees if the representation is 10 successful.” Crawford v. Astrue, 586 F.3d 1142, 1147 (9th Cir. 2009) (citing Gisbrecht, 535 U.S. 11 at 803). “[A] district court charged with determining a reasonable fee award under § 406(b)(1)(A) 12 must respect ‘the primacy of lawful attorney-client fee agreements,’ . . . ‘looking first to the 13 contingent-fee agreement, then testing it for reasonableness.’” Id. at 1148 (quoting Gisbrecht, 535 14 U.S. at 793, 808). Courts must begin with the fee agreement and then ask “whether the amount need 15 be reduced . . . .” Id. at 1149. Factors that may support a reduction include “if the attorney provided 16 substandard representation or delayed the case, or if the requested fee would result in a windfall.” 17 Id. at 1151; see also Gisbrecht, 535 U.S. at 808. An award of § 406 fees is offset by any award of 18 attorney fees granted under the EAJA. Gisbrecht, 535 U.S. at 796. 19 20 DISCUSSION 21 Here, the Court finds that the amount of fees sought is reasonable. The Court has reviewed 22 the fee agreement. Plaintiff does not dispute the authenticity of the document and he concedes that 23 he signed the agreement. The fee agreement is within the statutory ceiling, providing that if plaintiff 24 receives a favorable decision after an appeal to federal court, he agrees to pay counsel a fee no 25 greater than 25 percent of the past-due benefits awarded. Dkt. No. 24-4 at 1. The Court further 26 finds there is no indication of “substandard performance[.]” See Crawford, 586 F.3d at 1151. To 27 the contrary, counsel achieved excellent results, prevailing on a contested summary judgment 1 client. The Court also notes that the requested fee of $29,000 is roughly 17.5% of the past-due 2 benefit award, lower than the 25% rate allowed by statute. 3 Counsel states that he spent 29.35 hours on the court representation and has attached a log 4 of itemized services. See Dkt. No. 24-5. The Court finds those hours are reasonable in proportion 5 to the complexity of the case and that awarding the full fee would not result in a windfall to counsel. 6 The Supreme Court has “flatly rejected” a lodestar approach3 to Section 406(b) fee motions. 7 Crawford, 586 F.3d at 1148 (citing Gisbrecht, 535 U.S. at 808-09). Courts may use the lodestar 8 method “only as an aid in assessing the reasonableness of the fee[,]” not as a starting point for 9 determining whether the fee is reasonable. Id. at 1151 (citing Gisbrecht, 535 U.S. at 808). Here, 10 the $29,000.00 award that counsel seeks for 29.35 hours spent on the case would result in an 11 effective hourly rate of just under $1,000.00. The Court finds this figure is in line with other fee 12 awards in similar cases in this district and also compensates for the risk that counsel incurs when 13 taking a case on contingency. See, e.g., Donna M. v. Kijakazi, No. 19-cv-3134-DMR, Dkt. No. 34 14 at 3 (N.D. Cal. Dec. 28, 2023) (approving § 406(b) fee motion for an effective hourly rate of $1,403); 15 L.M. v. Kijakazi, No. 17-cv-3562-JCS, Dkt. No. 30 at 4 (N.D. Cal. Nov. 2, 2023) (same, for effective 16 hourly rate of $1,475); see also Crawford, 586 F.3d at 1150 (“[t]he lodestar method tends to under- 17 compensate attorneys for the risk they undertook in representing their clients and does not account 18 for the fact that the statute limits attorneys’ fees to a percentage of past-due benefits and allows no 19 recovery from future benefits, which may far exceed the past-due benefits awarded”). 20 Much of plaintiff’s dispute is with the quality of representation at the administrative level 21 and the idea that an attorney can get a windfall by first losing at the administrative level. In other 22 words, plaintiff supposes that an attorney may purposely lose a Social Security case at the 23 administrative level in order to drag the case out and increase the ultimate past-due benefits award. 24 The Court notes that plaintiff’s letters are directed to the ALJ, and the question of the quality of 25 representation performed at the administrative level is not before this Court. In the appeal to district 26 court, plaintiff’s counsel requested and received one thirty-day extension of time to file the motion 27 1 for summary judgment and a fourteen-day extension to file the reply brief. Dkt. Nos. 12, 18. In the 2 || undersigned Judge’s experience, such extension requests are common and not excessive in Social 3 Security appeals. There is no indication of any undue delay attributable to misconduct here. 4 Plaintiff concedes that he signed the fee agreement and that it allows for up to 25% of any 5 || past-due benefits. See Dkt. No. 28 at 2. However, he states that he “was completely taken by 6 || surprise when [he] learned that Sackett expected to receive 25% of my back pay” and that he “simply 7 [doesn’t] think [Sackett] did enough to earn that.” Jd. It is worth noting that “the 25% cap in 8 § 406(b)(1)(A) applies only to fees for court representation, and not to the aggregate fees awarded 9 || under §§ 406(a) and (b)[.]” See Culbertson v. Berryhill, 586 U.S. 53, 62 (2019). In other words, 10 || the statute allows an attorney to seek 25% of the past-due benefits for court representation and an 11 additional fee for representation at the agency level.* The current fee motion thus requests less than 12 || the maximum allowed under the statute. 5 13 In sum, the Court finds that the fee requested is within the limit allowed by statute, is within 14 || the limit allowed under the fee agreement that plaintiff signed, and is reasonable.

16 CONCLUSION 3 17 For the foregoing reasons, the Court hereby GRANTS the motion for attorney’s fees and 18 awards fees in the amount of $29,000.00 pursuant to 42 U.S.C. § 406(b)(1)(A). Defendant shall 19 make all reasonable efforts to tender payment in a timely fashion without undue delay to Plaintiff 20 for $29,000.00 in attorney’s fees minus $6,250.00. The latter shall tender to Plaintiff for 21 reimbursement of EAJA fees, for a net payment of $22,750.00 under 28 U.S.C. § 406(b)(1)(A). 22 23 IT IS SO ORDERED. 24 Dated: October 4, 2024 WU tee 25 iL LAK 6 SUSAN ILLSTON United States District Judge 27 28 4 The Court takes no position on the reasonableness of the fees requested for work performed at the administrative agency level under § 406(a), as that is for the agency to determine.