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Barnhart v. Commissioner of Social Security Administration

United States District Court, D. Oregon, Portland Division

August 4, 2014



JOHN V. ACOSTA, Magistrate Judge.


Before the court is Timothy Barnhart's ("Barnhart") unopposed Motion for Approval of Attorneys Fees Pursuant to 42 U.S.C. § 406(b), which permits a court to award attorney fees to the attorney of a successful Social Security claimant, so long as the award is "a reasonable fee for such representation" and "not in excess of twenty-five percent of the total of the past-due benefits to which the claimant is entitled...." 42 U.S.C. § 406(b)(1)(A). Although Barnhart is the claimant in this case, the real party in interest to this motion is his attorney Tim Wilborn ("Wilborn"). The Commissioner of Social Security ("Commissioner") does not oppose the motion, but merely acts in a manner similar to "a trustee for the claimant[]." Gisbrecht v. Barnhart, 535 U.S. 789, 798 n.6 (2002). Having reviewed the proceedings below and the amount of fees sought, the court concludes a reasonable fee award in this case is $6, 942.79 - a $10, 975.38 § 406(b) fee award less the $4, 032.59 Equal Access to Justice Act ("EAJA") fee Wilborn already received.

Procedural Background

Barnhart filed applications for Supplemental Security Income and Disability Insurance Benefits on June 18, 2008. Both applications were denied initially and upon reconsideration. Barnhart then filed a request for, and received, a hearing before Administrative Law Judge Mary Ann Lunderman (the "ALJ"), who issued a decision on November 24, 2009, finding Barnhart not disabled. The Appeals Council later denied Barnhart's timely request for review, making the ALJ's opinion the Commissioner's final decision. In this court, Barnhart filed a complaint for review of the Commissioner's final decision.

In his complaint, Barnhart alleged the ALJ's decision was not supported by substantial evidence and the ALJ failed to apply the appropriate standard of law as grounds for remanding his case for further proceedings. The Commissioner initially opposed Barnhart's allegations in its answer and asked this court to dismiss the complaint, stating "[t]he findings of fact of the Commissioner [were] supported by substantial evidence and [were] conclusive." On August 28, 2012, the Commissioner filed a Stipulation For Remand Pursuant to Sentence Four of 42 U.S.C. § 405(g). In accordance with the parties' stipulation, this court issued an Opinion and Order reversing and remanding Barnhart's case for further proceedings. The court ordered that on remand the ALJ: 1) update the record and receive any additional evidence Barnhart submitted; 2) reconsider Barnhart's earnings in light of new evidence Barnhart had submitted to the Appeals Council; and 3) if appropriate, evaluate the remaining steps of the sequential evaluation.

On November 28, 2012, the parties stipulated to an award of attorney fees pursuant to the EAJA, 28 U.S.C. § 2412(d), in the amount of $4, 032.59, and $350.00 in costs pursuant to 28 U.S.C. § 1920. On May 20, 2014, Wilborn filed the present motion for attorney fees pursuant to 42 U.S.C. § 406(b). The Commissioner filed its response on June 17, 2014. In its response, the Commissioner does not oppose Wilborn's motion for fees and leaves the determination of the amount of the fees to the discretion of the court.


After entering a judgment in favor of a Social Security claimant represented by counsel, the court "may determine and allow as part of its judgment a reasonable fee for such representation, not in excess of twenty-five percent of the total of the past-due benefits to which the clamant is entitled by reason of such judgment." 42 U.S.C. § 406(b)(1)(A). A "twenty-five percent contingent-fee award is not automatic or even presumed; the statute does not create any presumption in favor of the agreed upon amount.'" Dunnigan v. Astrue, No. CV 07-1645-AC, 2009 WL 6067058, at *7 (D. Or. Dec. 23, 2009), adopted by 2010 WL 1029809 (March 17, 2010) (quoting Gisbrecht, 535 U.S. at 807 n.17). A section 406(b) fee award is paid from the claimant's retroactive benefits, and an attorney receiving such an award may not seek any other compensation from the claimant. Dunnigan, 2009 WL 6067058, at *7. Accordingly, when a court approves both an EAJA fee and a section 406(b) fee payment, the claimant's attorney must refund to the claimant the amount of the smaller of the two payments. Gisbrecht, 535 U.S. at 796.

I. Fee Agreement

Under the Supreme Court's decision in Gisbrecht, the court first examines the contingent fee agreement to determine whether it is within the statutory twenty-five percent cap. This determination requires evidence of the retroactive benefits to be paid to the claimant. Wilborn has included a document from the Social Security Administration entitled "Notice of Award, " which details the retroactive benefits due Barnhart and states that it has withheld $21, 106.50, which amounts to twenty-five percent of past-due benefits available to pay a lawyer. (Pl.'s Motion for Approval of Atty.'s Fees Pursuant to 42 U.S.C. § 496(b) ("Pl.'s Motion"), Ex. 1 at 3.)

Barnhart and Wilborn executed a contingent-fee agreement, providing that if it became necessary to appeal Barnhart's case to federal court and Wilborn obtained payment, Barnhart would pay Wilborn either twenty-five percent of Barnhart's past-due benefits or whatever amount Wilborn was able to obtain under the EAJA, whichever was greater. In the motion for attorney fees, Wilborn requests the court award the $21, 106.50. In addition, Wilborn received a $4, 032.59 attorney fee award under the EAJA, which will offset part of the $21, 106.50 award if the court rules in his favor. Thus, at issue is a total award of $17, 073.91, and the requested award is within the statutory limit.

II. Reasonableness Factors

An order for an award of benefits should not be viewed in isolation, nor can it be presumed always to require a fee award of twenty-five percent of a claimant's retroactive benefits award. Dunnigan, 2009 WL 6067058, at *12. Counsel bears the burden to establish the reasonableness of the requested fee. Gisbrecht, 535 U.S. at 807. While the court must acknowledge the "primacy of lawful attorney-client fee agreements, " contingent fee agreements that fail to "yield reasonable results in particular cases" may be rejected. Id. at 793, 807. The court must ensure a disabled claimant is protected from surrendering retroactive disability benefits in a disproportionate payment to counsel. Crawford v. Astrue, 586 F.3d 1142, 1151 (9th Cir. 2009) (en banc) (citing Gisbrecht, ...

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