United States District Court, N.D. Indiana, Fort Wayne Division
MICHELLE D. HARRIS, Plaintiff,
CAROLYN W. COLVIN, Acting Commissioner of Social Security, Defendant.
OPINION AND ORDER
ROGER B. COSBEY, Magistrate Judge.
Plaintiff Michelle Harris brought this suit to contest a denial of disability benefits by Defendant Commissioner of Social Security ("Commissioner"). (Docket # 1.) In November 2012, this Court entered an order that reversed the Commissioner's denial of benefits and remanded the case to the Commissioner for further proceedings. (Docket # 31, 32.)
Harris's attorney, Joseph Shull, now moves pursuant to 42 U.S.C. § 406(b) for the Court's authorization of attorney fees in the amount of $11, 786.50 for his representation of Harris in federal court. (Docket # 37.) The Commissioner has not objected to Shull's motion, and the time to do so has expired.
For the reasons set forth herein, Shull's motion for authorization of attorney fees will be GRANTED.
A. Relevant Factual and Procedural Background
On November 29, 2011, Shull and Harris entered into a contingent fee agreement for Shull's representation of Harris in federal court. (Mem. in Supp. of Pl.'s Attorney's Mot. for an Award of Att'y Fees Under 42 U.S.C. § 406(b) ("Mem. in Supp.") Ex. B.) Under the agreement, Harris agreed that Shull would "charge and receive as his fee an amount equal to twenty-five percent (25%) of the past-due benefits which are awarded to [her] family and [her] in the event [her] case is won." (Mem. in Supp. Ex. B.)
On November 29, 2011, Harris filed the instant action with this Court, appealing the Commissioner's denial of her application for disability benefits. (Docket # 1.) In November 2012, Harris received a favorable judgment from this Court, and the case was remanded to the Commissioner for further proceedings. (Docket # 31, 32.) Harris then filed a request for attorney fees under the Equal Access to Justice Act ("EAJA"), 28 U.S.C. § 2412, seeking payment for the 18.2 hours Shull spent advocating Harris's claim in federal court. (Docket # 33-35.) The Court awarded Harris $3, 348.80 in EAJA fees (Docket # 36), but that entire amount was offset against a debt that she owed to the government (Mem. in Supp. 2, Ex. C); thus, Shull did not receive any portion of the EAJA fee award. (Mem. in Supp. 2.) Shull did receive, however, $6, 000 in attorney fees pursuant to 42 U.S.C. § 406(a) for his representation of Harris at the administrative level. (Mem. in Supp. 2, Ex. A, D.)
Ultimately, the Commissioner awarded disability benefits to Harris, and as a result, she received $54, 798 in back benefits. (Mem. in Supp. 2, Ex. A.) On July 22, 2014, Shull filed the instant motion, seeking the Court's authorization of a payment of $11, 786.50 in attorney fees from Harris to Shull pursuant to the contingent fee agreement. (Docket # 37, 38.)
B. Legal Standard
Fees for representing social security claimants, both administratively and in federal court, are governed by 42 U.S.C. § 406. Gisbrecht, 535 U.S. at 793, 795-96. Section 406(a) controls fees for representation in administrative proceedings and § 406(b) controls attorney fees for representation in court. Id. at 796. Unlike fees obtained under the EAJA,  the fees awarded under § 406 are charged against the claimant, not the government. Id.
Under § 406(a), an attorney who has represented a claimant may file a fee petition or fee agreement with the Commissioner to receive fees for his representation at the administrative level. 42 U.S.C. § 406(a); Gisbrecht, 535 U.S. at 794-95; 20 C.F.R. § 404.1725(b). There are, however, limits on the amount that the Commissioner can award pursuant to § 406(a). Gisbrecht, 535 U.S. at 794-95.
In addition to the fee award available pursuant to § 406(a), under § 406(b) an attorney who has successfully represented a claimant in federal court may receive "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); Gisbrecht, 535 U.S. at 795. The combination of fees awarded under § 406(a) and § 406(b), however, can never exceed 25% of the past-due benefits awarded to the claimant. Kopulos v. Barnhart, 318 F.Supp.2d 657, 661 (N.D. Ill. 2004); Bartrom v. Barnhart, No. 1:99-CV-44, 2003 WL 21919181, at *2-3 (N.D. Ind. Feb. 26, 2003). Moreover, § 406(b) has been harmonized with the EAJA; though fee awards may be made under both the EAJA and § 406(b), a claimant's attorney must refund to the claimant the amount of the smaller fee. Gisbrecht, 535 U.S. at 796 (explaining that "an EAJA award offsets an award under Section 406(b)").
Unlike the award by the Commissioner under § 406(a), the court is required under § 406(b) to review for reasonableness the attorney fees yielded by contingent fee agreements. Id. at 809. The Supreme Court has explained:
Congress has provided one boundary line: Agreements are unenforceable to the extent that they provide for fees exceeding 25 percent of the past-due benefits. Within the 25 percent boundary, ... the attorney for the successful claimant must show that the fee sought is reasonable for the services rendered. Courts that approach fee determinations by looking first to the contingent-fee agreement, then testing it for reasonableness, have appropriately reduced the attorney's recovery based on the character of the representation and the results the representative achieved. If the attorney is responsible for delay, for example, a reduction is in order so that the attorney will not profit from the accumulation of ...