United States District Court, S.D. Ohio, Western Division, Dayton
Herbert Rice, District Judge.
REPORT AND RECOMMENDATIONS
L. Ovington, United States Magistrate Judge.
case is before the Court upon a Motion for Allowance of
Attorney Fees filed by Plaintiff's counsel (Doc. #16),
the Commissioner's Response (Doc. #17), and the record as
a whole. Plaintiff's counsel seeks an award of $15,
050.00 in attorney fees under 42 U.S.C. § 406(b)(1).
“The Commissioner submits that either reducing the fee
sought by counsel or awarding the full fee requested would be
within the Court's discretion.” (Doc. #17,
PageID # 976).
this case began, Plaintiff and his counsel entered into a
written contingency-fee agreement. The agreement documented
Plaintiff's agreement to pay attorney fees in the amount
of 25% of any lump sum award for past-due Social Security
benefits payable to Plaintiff. The agreement also documented
counsel's willingness to work on a contingency-fee basis.
This resulted in counsel's acceptance of the risk he
would recover zero attorney fees in the event Plaintiff
received no past-due benefits. See Doc. #26,
case proceeded, the Court determined that a remand for
further proceedings was warranted, and Judgment was entered
accordingly. On remand, the Social Security Administration
awarded Plaintiff past-due benefits and withheld from those
benefits $31, 720.25 for payment of attorney fees.
Id. at 897.
stated above, Plaintiff's counsel presently seeks
approval of a $15, 050.00 award of attorney fees from the
funds withheld from Plaintiff's past-due benefits. The
attorney-fee award Plaintiff's counsel seeks, if granted,
would result in an award based on a hypothetical hourly rate
of $700.00 ($15, 050.00 ÷ 21.50 hours = $700.00). The
Commissioner cites cases in which Judges of this Court and
the U.S. District Court for the Northern District of Ohio
reached differing conclusions about the amount of attorney
fees that constitute a windfall. (Doc. #17, PageID
#s 975-76, nn.4-6). These differing conclusions lead the
Commissioner to ask this court to “determine an
appropriate fee for counsel's services.”
Id. at 976.
406(b) authorizes this Court to award attorney's fees
when a plaintiff brings a successful challenge to the Social
Security Administration's denial of his or her
application for benefits. See Damron v. Comm'r of
Soc. Sec., 104 F.3d 853, 856 (6th Cir. 1997). The award
may not exceed 25% of the past-due benefits that the
plaintiff received as a result of the successful challenge.
See id.; see also 42 U.S.C. §
succeed under § 406(b), the plaintiff's counsel must
show, and the court must affirmatively find, that the
contingency fee sought-even one within the 25% cap-is
reasonable for the services rendered. Gisbrecht v.
Barnhart, 535 U.S. 789, 807 (2002); see
Lasley v. Comm'r of Soc. Sec., 771 F.3d 308, 309
(6th Cir. 2014). Section 406(b) “does not displace
contingent-fee agreements” but instead “calls for
court review of such arrangements as an independent check, to
assure that they yield reasonable results in particular
cases.” Gisbrecht, 535 U.S. at 807.
determine whether an award under § 406(b) is reasonable,
a floor/ceiling approach guides the way. The ceiling is
§ 406(b)'s 25% cap, which “accords a
rebuttable presumption of reasonableness to contingency
agreements that comply with § 406(b)'s
25%-cap.” Lasley, 771 F.3d at 309. The floor
is “[the] hypothetical rate that is twice the standard
rate for such work in the relevant market.” Hayes
v. Sec'y of Health & Human Servs., 923 F.2d 418,
422 (6th Cir. 1991). “‘[A] hypothetical hourly
rate that is less than twice the standard rate is per
se reasonable ...'” Lasley, 771 F.3d
at 309 (quoting Hayes, 923 F.2d at 421).
the range set by this floor and this ceiling, “a
hypothetical hourly rate that is equal to or greater than
twice the standard rate may well be reasonable.'”
Lasley, 771 F.2d at 309 (quoting Hayes, 923
F.2d at 421). Courts may consider arguments attacking the
rebuttable presumption of reasonableness that attaches to
awards above the double-the-standard-rate floor and below the
25% statutory ceiling. Id. at 309.
remains the heart of the matter. And, care must be taken to
consider the presumption a rebuttable-not a
strict-presumption of reasonableness. Lasley, 771
F.2d at 309 (noting, “Gisbrecht ... elides
strict presumptions altogether.”). Reducing a
sought-after award is warranted to avoid windfalls especially
“‘[i]f the benefits are large in comparison to
the amount of time counsel spent on the case ....'”
Id. at 310 (quoting Gisbrecht, 535 U.S. at
award Plaintiff's counsel requests, $15, 050.00, is
reasonable and not a windfall. This amount is far less than
25% of Plaintiff's past-due benefits awarded by the
Social Security Administration. Further, the hypothetical
hourly rate of $700.00 (calculated above), when viewed as the
product of the applicable multiplier of 2, see
Hayes, 923 F.2d at 422, translates to an hourly rate of
$350.00. This is below the hourly rates and the hypothetical
hourly rates permitted in a number of well-reasoned decisions
in this District. See, e.g., Jodrey v. Comm'r of Soc.
Sec., No. 1:12-cv-725, 2015 WL 799770, at *3-4 (S.D.
Ohio 2015) Report and Recommendation (Litkovitz, M.J.),
adopted, 2015 WL 1285890 (S.D. Ohio 2015) (Barrett,
D. J.) (approving hypothetical hourly rate of $700.00);
Havens v. Comm'r of Soc. Sec., No. 2:12-cv-637,
2014 WL 5308595, at *2 (S.D. Ohio Oct. 16, 2014) Report and
Recommendation (Kemp, M.J.), adopted, 2014 WL
6606342 (S.D. Ohio 2014) (Smith, J.) (approving hypothetical
hourly rate of $750.00); Metz v. Comm'r, Soc. Sec.
Admin., 2014 WL 1908512, at *1-2 (S.D. Ohio 2014)
(Black, D.J.) (approving hypothetical hourly rate of
$780.25); Pickett v. Astrue, 2012 WL 1806136, at *2
(S.D. Ohio 2012) (Black, D. J.) (approving hypothetical
hourly rate of approximately $709). Plaintiff's counsel,
moreover, skillfully obtained a remand for further
administrative proceedings in this case and on remand secured
significant awards of benefits (including past-due benefits)
for Plaintiff. For these reasons, the proposed hypothetical
hourly rate in this case ($700.00) and the total amount of
attorney fees counsel seeks do not constitute a windfall to
Plaintiff's counsel's Motion for Allowance of
Attorney Fees is well taken.
IS THEREFORE ...