United States District Court, S.D. New York
PABLO E. PELAEZ, Plaintiff,
NANCY A. BERRYHILL, Acting Commissioner, Social Security Administration, Defendant.
HONORABLE WILLIAM H. PAULEY, UNITED STATES DISTRICT JUDGE
REPORT AND RECOMMENDATION
L .COTT UNITED STATES MAGISTRATE JUDGE
Pablo E. Pelaez has moved pursuant to 42 U.S.C. §
406(b) seeking approval of a contingent fee agreement in
this social security case. Mot. for Approval, dated Nov. 28,
2017 (Dkt. No. 17). Under the retainer agreement signed by
Pelaez and his counsel, his attorney is to be compensated 25%
of all past due benefits recovered. Decl. of Christopher J.
Bowes in Support of Pl.'s Mot., dated Nov. 28, 2017 (Dkt.
No. 18) (“Bowes Decl.”), ¶ 11, Ex. A,
Retainer Agreement. Through his motion papers, Pelaez seeks a
net payment of $15, 188.50 for his attorney, which represents
25% of the recovered past due benefits of $87, 098 (that is,
$21, 774.50), adjusted for the $6, 586 in fees that had
previously been awarded to his attorney under the Equal
Access to Justice Act (“EAJA”). Id.
¶¶ 15-17; see also Stipulation and Order,
dated Aug. 13, 2013 (Dkt. No. 16). The Commissioner has not
opposed this motion and believes the fees sought are
reasonable. Letter from Assistant United States Attorney John
E. Gura, dated Dec. 7, 2017 (Dkt. No. 21). The motion has
been referred to me for a report and recommendation. Order of
Reference, dated Nov. 7, 2012 (Dkt. No. 3); Amended Order of
Reference, dated Dec. 1, 2017 (Dkt. No. 20).
Social Security Act provides that:
Whenever a court renders a judgment favorable to a claimant
under this subchapter 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 of the past-due benefits to
which the claimant is entitled by reason of such judgment . .
U.S.C. § 406(b)(1)(A).
“406(b) does not displace contingent-fee agreements
within the statutory ceiling, ” but rather
“instructs courts to review for reasonableness fees
yielded by those agreements.” Cahill v.
Colvin, No. 12-CV-9445 (PAE) (MHD), 2016 WL 4581342 at *
1 (S.D.N.Y. Sept. 2, 2016) (quoting Gisbrecht v.
Barnhart, 535 U.S. 789, 808-09 (2002)). “[T]he
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.” Vaupen v. Colvin, No.
14-CV-6359 (CM) (KNF), 2017 WL 2304015, at *2 (S.D.N.Y. May
8, 2017) (quoting Wells v. Sullivan, 907 F.2d 367,
371 (2d Cir. 1990)), adopted by, 2017 WL 2304014
(S.D.N.Y. May 25, 2017). “Factors to be considered when
determining whether an award is reasonable include: (a)
whether the contingency fee is within the twenty-five percent
limit; (b) whether the retainer was the result of fraud or
overreaching by the attorney; and (c) whether the attorney
would enjoy a windfall relative to the services
provided.” Id. (citing Wells, 907
F.2d at 372). Additionally, “[f]ee awards may be made
under both . . . the EAJA and § 406(b), but the attorney
must give the smaller fee to the client.”
Id. (citing Gisbrecht, 535 U.S. at 796).
factors all weigh in favor of Pelaez's request for
approval. First, the contingency fee of 25% does not exceed
the statutory limit. Second, there is no evidence in the
record that the retainer agreement was the result of fraud or
overreach. Finally, based on the Court's review of the
record, the fee is not so large that it constitutes a
windfall relative to the services provided. Pelaez's
attorney, Christopher J. Bowes, submitted a detailed,
non-boilerplate, 25-page memorandum of law with extensive
factual and legal analysis in support of his motion for
judgment on the pleadings. Mem. of Law in Support of
Pl.'s Mot., filed April 26, 2013 (Dkt. No. 11). Pelaez
received the outcome he sought: following the filing of his
motion papers, the Commissioner and Pelaez stipulated to
remand to the Social Security Administration for further
proceedings. Bowes Decl. ¶12; see also
Stipulation and Order of Remand, dated July 24, 2013 (Dkt.
No. 14). As a result of those proceedings, Pelaez was found
to be disabled, and therefore entitled to past due benefits
of $87, 098. Bowes Decl. ¶¶ 14-15, see also
id., Ex. C. Bowes spent a total of 34.3 hours working on
Pelaez's case, id., Ex. B, which is a reasonable
number of hours given his work on this case.
foregoing reasons, the Court recommends granting Pelaez's
unopposed motion for approval of the contingency fee
arrangement in this case. The Social Security Administration
should be directed to approve a fee of $21, 774.50, less the
$6, 586 already paid to Bowes under the EAJA, for a net
payment of $15, 188.50.
FOR FILING OBJECTIONS TO THIS REPORT AND
to 28 U.S.C. § 636(b)(1) and Rule 72(b) of the Federal
Rules of Civil Procedure, the parties have fourteen (14) days
(including weekends and holidays) from service of this Report
and Recommendation to file any objections. See Fed.
R. Civ. P. 6(a), (b), (d). A party may respond to any
objections within fourteen (14) days after being served. Such
objections, and any responses to objections, shall be filed
with the Clerk of Court, with courtesy copies delivered to
the chambers of the Honorable William H. Pauley and the
undersigned, United States Courthouse, 500 Pearl Street, New
York, New York 10007. Any requests for an extension of time
for filing objections must be directed to Judge Pauley.
TO FILE OBJECTIONS WITHIN FOURTEEN (14) DAYS WILL RESULT IN A
WAIVER OF OBJECTIONS AND WILL PRECLUDE APPELLATE
REVIEW. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72.
See Thomas v. Arn, 474 U.S. 140 (1985); Wagner
& Wagner, LLP v. Atkinson, Haskins, Nellis,
Brittingham, Gladd & Carwile, P.C., 596 F.3d 84,
92 (2d Cir. 2010).