Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-06-55822/USCOURTS-ca9-06-55822-0/pdf.json

Nature of Suit Code: 864
Nature of Suit: Social Security - SSID Title XVI
Cause of Action: 

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FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

CLARA CRAWFORD, 

Plaintiff,

v.

M No. 06-55822 ICHAEL J. ASTRUE, Commissioner

of Social Security Administration,  D.C. No.

Defendant-Appellee, CV-00-011884 (AN)

BRIAN C. SHAPIRO,

Real-party-ininterest-Appellant. 

Appeal from the United States District Court

for the Central District of California

Arthur Nakazato, Magistrate Judge, Presiding

RUBY WASHINGTON, 

Plaintiff,

v.

M No. 06-55954 ICHAEL J. ASTRUE, Commissioner

of Social Security Administration,  D.C. No.

Defendant-Appellee, CV-03-06884 (AN)

YOUNG CHO,

Real-party-ininterest-Appellant. 

Appeal from the United States District Court

for the Central District of California

Arthur Nakazato, Magistrate Judge, Presiding

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DAPHNE M. TREJO, 

Petitioner-Appellant, No. 06-56284

v. D.C. No. 

M CV-98-5662 (RNB) ICHAEL J. ASTRUE, Commissioner

of Social Security Administration, OPINION

Respondent-Appellee. 

Appeal from the United States District Court

for the Central District of California

Robert N. Block, Magistrate Judge, Presiding

Argued and Submitted

February 15, 2008—Pasadena, California

Filed September 25, 2008

Before: Betty B. Fletcher, Daniel M. Friedman,* and

N. Randy Smith, Circuit Judges.

Opinion by Judge Friedman;

Dissent by Judge B. Fletcher

*The Honorable Daniel M. Friedman, Senior United States Circuit

Judge for the Federal Circuit, sitting by designation. 

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COUNSEL

Lawrence D. Rohlfing, Santa Fe Springs, California, for the

petitioner-appellant in all three cases. 

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No appearance for the respondent-appellee in any of the three

cases. 

OPINION

FRIEDMAN, Circuit Judge: 

We decide each of these three appeals, which were argued

together, in a single opinion. In these cases, lawyers who successfully represented social security claimants under

contingent-fee contracts challenge the sufficiency of the fees

the United States District Court for the Central District of California awarded for the services they performed in the judicial

phase of the cases. The lawyers contend that in setting their

fees the district court failed to follow the methodology the

Supreme Court prescribed in Gisbrecht v. Barnhart, 535 U.S.

789 (2002), for determining attorney fees in social security

cases. 

We hold, however, that in awarding the fees in these cases

the district court did not deviate from the standards

announced in Gisbrecht and did not abuse its discretion. We,

therefore, affirm in all three cases.

I. Each of these cases followed the same pattern: (1) after

the Social Security Administration (“Administration”) denied

a claim for benefits, the claimant retained an attorney to institute a judicial challenge to the administrative action and

signed a written agreement under which the attorney would be

paid twenty-five percent of “the back pay awarded”; (2) after

suit was filed, the case was remanded to the Administration;

(3) the Administration awarded the claimant benefits, including substantial past benefits; (4) the attorney requested from

the district court a fee of less than twenty-five percent of the

back benefits; and (5) the district court (acting through a magistrate judge) awarded the attorney less than the amount

sought. 

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Each of the three claimants was represented by a different

attorney: Brian C. Shapiro (“Shapiro”) represented Clara

Crawford, Young Cho (“Cho”) represented Ruby Washington, and Denise Bourgeois Haley (“Haley”) represented

Daphne M. Trejo. The three attorneys were affiliated with the

Lawrence D. Rohlfing (“Rohlfing”) law firm, which specializes in social security matters. Since the firm handled all its

work on a contingent-fee basis, it had no regular hourly billing rates. In each case the district court calculated what would

be a reasonable hourly rate for the work performed. The differences among the three cases relate to the work the attorney

performed in the particular case, the time expended, the

amount of back benefits awarded, the attorney fee requested,

and the fee awarded. 

In the Crawford case (No. 06-55822), Shapiro expended

19.5 hours of his own time and 4.5 hours of paralegal time.

The past-due benefits awarded were $123,891.20, twenty-five

percent of which was $30,972.80. Shapiro sought a fee of

$21,000.00, which was 16.95 percent of the award. The court

determined that a reasonable fee would be $8,270.00, which

it reduced by $3,150.00 to reflect the fee already paid under

the Equal Access to Justice Act, producing a net fee award of

$5,120.00. 

In the Washington case (No. 06-55954), Cho devoted 17.45

hours of his time and 4.7 hours of paralegal time. The pastdue benefits awarded were $76,041.00, twenty-five percent of

which was $19,010.25. Cho sought a fee of $11,500.00,

which was fifteen percent of those benefits. The court determined that a fee of $8,825.53 would be reasonable, which it

reduced by the $2,800.00 that had already been paid under the

Equal Access to Justice Act, resulting in a net fee award of

$6,025.33. 

In the third case, Trejo (No. 06-56284), Haley spent 25.5

hours of her time and 1.1 hours of paralegal time. The pastdue benefits awarded were $172,223.25, twenty-five percent

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of which was $43,055.75. Haley sought a fee of $24,000.00,

which was fourteen percent of the benefits. The district court

determined that a reasonable fee would be $12,650.40, which

it reduced by the $3,200.00 prior payment made under the

Equal Access to Justice Act, resulting in a net fee of

$9,450.00. 

We discuss in detail, in Parts IIB and IID, below, the

court’s determinations and reasoning in setting the fee in each

case. 

II. A. Before Gisbrecht, courts ordinarily used a “lodestar” calculation for determining a “reasonable” attorney fee

under fee-shifting statutes that required the losing party to pay

the prevailing party’s legal fees. See Gisbrecht, 535 U.S. at

801-02. Under that calculation, to produce a reasonable fee a

court multiplied the “number of hours reasonably devoted to

each case . . . by a reasonable hourly fee.” Id. at 797-98. 

[1] The lodestar calculation also was used in determining

reasonable attorney fees in social security cases, although the

Social Security Act does not shift payment of attorney fees

from the prevailing to the losing party. Instead, it provides for

payment of a successful claimant’s attorney fee out of the

benefits the claimant recovers. A court rendering a judgment

favorable to a social security claimant represented by an attorney may “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.” 42 U.S.C. § 406(b)(1)(A). Such fee

will be paid to the attorney “out of, and not in addition to, the

amount of such past-due benefits.” Id. When Gisbrecht was

decided, such contingent-fee contracts were “the most common fee arrangement between attorneys and Social Security

claimants.” Gisbrecht, 535 U.S. at 800. 

Gisbrecht, in which the Supreme Court reviewed one of our

decisions, was such a lodestar social security attorney fee

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case. There, the district court used the lodestar calculation to

determine attorney fees in four social security cases, but “set

hourly lodestar rates lower than those that Plaintiffs had

requested.” Gisbrecht v. Apfel, 238 F.3d 1196, 1198 (9th Cir.

2000). We affirmed the attorney fee awards, stating that

“[t]his court follows the ‘lodestar’ method of calculating fees

under 42 U.S.C. § 406(b)(1)(A),” and rejected the contention

that “the district courts abused their discretion by refusing to

increase the lodestar fees based on the contingent nature of

their fee agreements.” Id. at 1197, 1198-99. 

[2] The Supreme Court reversed. The Court rejected this

court’s view that the lodestar calculation was the sole basis

for determining attorney fees under the Social Security Act

and that a contingent-fee agreement was not to be considered.

It “conclude[d]” that “§ 406(b) does not displace contingentfee agreements as the primary means by which fees are set for

successfully representing Social Security benefits claimants in

court. Rather, § 406(b) 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 (footnote omitted). It added that “[w]ithin the 25 percent

boundary . . . the attorney for the successful claimant must

show that the fee sought is reasonable for the services rendered.” Id. The Court additionally stated:

Judges of our district courts are accustomed to making reasonableness determinations in a wide variety

of contexts, and their assessments in such matters, in

the event of an appeal, ordinarily qualify for highly

respectful review. 

Id. at 808. The Court concluded the opinion by stating that:

The courts below erroneously read § 406(b) to override customary attorney-client contingent-fee agreements. We hold that § 406(b) does not displace

contingent-fee agreements within the statutory ceilCRAWFORD v. ASTRUE 13695

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ing; instead, § 406(b) instructs courts to review for

reasonableness fees yielded by those agreements.

Accordingly, we reverse the judgment of the Court

of Appeals for the Ninth Circuit and remand the case

for further proceedings consistent with this opinion.

Id. at 808-09. 

[3] The Court’s holding was narrow: that, in setting reasonable attorney fees under contingent-fee agreements in social

security cases, courts cannot base their calculations solely on

lodestar calculations. Instead, courts must look primarily to

the contingent-fee specified and then, if necessary, adjust the

fee to reflect the circumstances of the particular case. The

Court stated that the attorney had the burden of showing that

“the fee sought is reasonable for the services rendered.” Id. at

807. The Court then discussed five examples of ways in

which the contingent-fee arrangement could be tested for reasonableness: (1) the character of the representation; (2) the

results the representative achieved; (3) if an attorney were

responsible for delay; (4) if benefits were large in comparison

to the amount of time spent on the case; and (5) a record of

the hours spent representing the claimant and a statement of

the lawyer’s normal hourly billing charge. Id. at 808. 

The Court did not decide, or indicate any views on, the following issues: 

1. Whether “contingent-fee agreement[s] between claimant and counsel, if not in excess of 25 percent of past-due

benefits, [were] presumptively reasonable.” Gisbrecht, 535

U.S. at 792. 

2. The extent to which, if any, courts could utilize a lodestar calculation based upon an appropriate hourly rate and the

hours properly spent on the case, in determining the reasonability of the fee. 

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The Court did not indicate how or on what basis district

courts were to determine that a fee was reasonable, but apparently left it to the court’s discretion. See id. at 808. In each of

these cases, the district court followed the precepts of Gisbrecht in setting a reasonable fee. 

B. In its orders, the district court noted that Gisbrecht

controls. In Crawford, the court stated that its “determination

. . . is governed” by Gisbrecht, in which “the Supreme Court

resolved a division among the Circuits on the appropriate

method of calculating fees under § 406(b). Rejecting the

‘lodestar method’ which several of the Circuits (including the

Ninth Circuit) had been applying, the Supreme Court held:

. . . .” The order then quoted most of the language from Gisbrecht referred to in Part IIA of this opinion. In Washington,

the same magistrate judge used the same language. In Trejo,

a different magistrate judge used, and quoted, almost identical

language in discussing Gisbrecht. 

The court in Crawford set forth seven items it had “considered” “[i]n determining whether the $21,000.00 award sought

by Rohlfing is reasonable for the services rendered in the proceedings before this Court.” Those items included the following: 

1. There was “no basis for finding that there was any

fraud or overreaching by Rohlfing in the making of the contingent fee agreement with plaintiff.” 

2. The fee sought “is within the 25% ‘boundary’ and less

than the total amount of fees that plaintiff agreed to pay Rohlfing under the terms of the contingent fee agreement.” 

3. “Rohlfing was able to persuade the Commissioner to

stipulate to a remand which ultimately resulted in a fully

favorable decision awarding back benefits in the amount of

$123,891.20 to Plaintiff.” 

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4. “This is not an instance where, due to excessive delay

attributable to plaintiff’s counsel, the back benefits accumulated during the pendency of the case in court.” 

5. “[I]t would not be unreasonable for a law firm having

the same degree of experience, expertise and reputation in the

legal community as Rohlfing to have normal hourly billing

charges” under which “adjusted for inflation the 19.5 hours of

attorney time plus 4.5 hours of paralegal time correspond to

total hourly fees of $5,907.14.” These are the same hours and

inflation adjustments Rohlfing presented to the Court. 

6. Using these figures, the $21,000.00 sought 

includes an enhancement of $15,092.86, which represents 256% of the $5,907.14 figure for the risk of

nonpayment (i.e., the “contingency factor”). The

Court has duly considered Rohlfing’s rationale for

the enhancement sought and does not find it to be

persuasive. The Court notes that Rohlfing has not

provided any data regarding his firm’s success rate

that would enable the Court to assess the risk

assumed by his firm in representing social security

benefits claimants in the Cent[r]al District of California. Moreover, to the extent that the success rate

of plaintiff’s counsel is attributable to his special

skills and expertise in this area (as distinguished

from his selectiveness in the cases he agrees to take

on), the Court already has taken into account his

skills and expertise in arriving at the figure of

$5,907.14 as the pre-enhancement value of the services rendered. The Court therefore finds that plaintiff’s counsel has not done an adequate job of

convincing the Court that the enhancement sought

here is reasonable under the circumstances presented. . . . The Court finds that a reasonable

enhancement here would be no more than 40% of

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the $5,907.14 figure (i.e., $2,362.86), which would

result in a total fee award of $8,270.00. 

“Put another way, it appears to the Court that the enhancement sought here by plaintiff’s counsel is very excessive, and

would constitute an unreasonable “windfall,” when the

amount of back pay benefits awarded is compared to the

amount of time counsel spent on the case. The Court finds

that a reasonable enhancement here would be no more than

40% of the $5,907.14 figure (i.e., $2,362.86), which would

result in a total fee award of $8,270.00. 

“Based upon the foregoing considerations, the Court finds

and concludes that the $21,000.00 in fees yielded by the contingent fee agreement and sought by plaintiff’s counsel is

completely unreasonable under the circumstances, and that a

substantial reduction is warranted.” 

The court’s order in the Washington case, authored by the

same magistrate judge, discusses similar factors the court

“considered” “[i]n determining whether the $11,500.00 award

sought by Plaintiff’s counsel is reasonable for the services

rendered in the proceedings before this Court.” In addition,

the court included the factor that “Plaintiff’s counsel did not

have to do much work to persuade the Commissioner to stipulate to a remand because it was very clear that the ALJ erred

and a remand was warranted. Accordingly, Plaintiff’s counsel

incurred very little risk in this matter.” The court also rejected

the lawyer’s argument that this case could be compared to

class action securities litigation, in which much larger attorney fees were awarded. The court stated: 

The complexity of the procedural and substantive

issues in class action securities cases, and the risks

of prosecuting those types of cases, eclipse those in

social security cases. In social security cases, the

costs of prosecuting the cases are relatively nominal

because most of the plaintiffs are allowed to file

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their complaints without the prepayment of the filing

fees, the issues are narrow, and the briefing in this

Court is generally limited to preparing a joint stipulation. The same is not true in class action securities

cases where it is not unusual for plaintiffs’ counsel

to invest millions of dollars in a case, and engage in

a substantial amount of discovery, pretrial briefing

and hearings, just to resolve issues relating to class

certification in addition to doing the same and more

with respect to prosecuting cases on the merits. The

complexity and costs of providing notice to the

members of the class is another reason for the large

enhancements in class action securities cases. 

The court concluded that “the enhancement sought here by

Plaintiff’s counsel is excessive and would constitute an unreasonable ‘windfall.’ Therefore, the Motion is denied to the

extent it seeks § 406(b) fees in the total amount of

$11,500.00. On the other hand, the Court finds a reasonable

enhancement here to be 40% of the $6,303.95 figure (i.e.,

$2,521.58), which results in a total fee award of $8,825.53.”

Finally, in Trejo, the court discussed eight factors it had

“considered” “[i]n determining whether the $24,000.00 award

sought by plaintiff’s counsel is reasonable for the services

rendered.” Several of these factors were phrased in language

similar to that in Crawford. The court also stated: “The high

quality of the representation provided in this case by plaintiff’s counsel is evidenced by the fact that, in the face of an

adverse ALJ decision which the Appeal Council already had

adopted, plaintiff’s counsel was able to persuade the Commissioner to stipulate to a remand which ultimately resulted in a

fully favorable decision awarding over twelve years of back

benefits.” 

The court concluded that, based upon the time properly

spent on the case and the appropriate hourly charges for the

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lawyer and paralegal, an appropriate fee would be $6,325.20.

The court found that the attorney had 

done a wholly inadequate job convincing the Court

that the 279% enhancement sought here is reasonable under the circumstances presented. Put another

way, it appears to the Court that the enhancement

sought here by plaintiff’s counsel is grossly excessive and would constitute an unreasonable ‘windfall,’ when the amount of back pay benefits awarded

is compared to the amount of time counsel spent on

the case. Even after taking into account the 7-year

delay in the receipt of § 406(b) fees, the Court finds

that a reasonable enhancement here would be no

more than 100% of the $6,325.20 figured, which

would result in a total fee award of $12,650.40. 

The court then stated:

Based upon the foregoing considerations, the Court

finds and concludes that the $24,000.00 in fees

sought by plaintiff’s counsel is not reasonable, and

that a further reduction to $12,650.40 is warranted.

[4] C. The district court’s orders in these three cases show

that, in determining a reasonable fee, the court in each case

complied with the Gisbrecht principles. In each case the court

stated that it was following Gisbrecht and quoted the pertinent

portions of that opinion. The court recognized the primacy of

the contingent-fee agreements by first determining that they

met the § 406(b)(1) guidelines, and then testing them for reasonableness. Id. at 808. 

[5] In Crawford and Trejo, the court explicitly stated that,

considering all the circumstances, a substantial reduction in

the fee sought, which was within but less than the twenty-five

percent contingent fee, was required to produce a reasonable

fee. Although the Washington court did not explicitly state

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that it was reducing the fee sought in light of the factors it had

considered, such ruling was implicit in the Trejo decision, and

this was what the court did (as distinguished from what it

said). In each case, the court also stated that the attorney had

not met his or her burden of showing that the fee sought was

reasonable. The district court’s reduction of the contingent

fees in these three cases accorded with Gisbrecht’s recognition that “[i]f the benefits are large in comparison to the

amount of time counsel spent on the case, a downward adjustment is similarly in order.” 535 U.S. at 808. 

The district court’s analysis of the relevant factors in these

cases, including the twenty-five percent contingent-fee agreement, starkly contrasts with the way the district court determined the fees in Gisbrecht. There, the district court based its

determination of a reasonable fee solely on “lodestar rates”

and refused to increase those rates to reflect the contingentfee agreements. See Gisbrecht, 238 F.3d at 1198-99. Here, on

the other hand, the lodestar calculation was but one of several

factors the district court considered when testing the

contingent-fee agreement for reasonableness after “looking

first to the contingent-fee agreement.” Gisbrecht, 535 U.S. at

808. 

[6] We read Gisbrecht not to prohibit a district court from

making lodestar-type calculations, but only from relying

exclusively on such calculations and refusing to consider the

contingent-fee agreement. Here, the district court noted that

Gisbrecht controls, and considered the contingent-fee agreements. The district court, however, concluded that substantial

reductions in the fees under those agreements were necessary

for the fees to meet the statutory standard of reasonableness.

Those rulings complied with the requirements of Gisbrecht. 

[7] Unlike the dissent, we do not read the Supreme Court’s

Gisbrecht opinion as mandating any particular procedure or

format that the district courts must follow in determining a

reasonable attorney fee in social security cases. The Court did

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not, as the dissent apparently concludes, prescribe that in

every case the district court mechanically must begin its analysis with the twenty-five percent contingent fee and then

make any reduction in that amount that appears appropriate in

the particular case. 

[8] As we have noted above, what Gisbrecht held was that

“§ 406(b) does not displace contingent-fee agreements within

the statutory ceiling; instead, § 406(b) instructs courts to

review for reasonableness fees yielded by those agreements.”

535 U.S. at 808. The methodology by which a district makes

such reasonableness determinations is for that court to select

in the exercise of its sound discretion. In making these determinations, it would be preferable for a district court to begin

with the contingency-fee agreement and decrease from there,

rather than increase from a lodestar calculation. It does not

seem to be an abuse of discretion, however, to use the latter

approach as long as the court takes the necessary factors into

consideration. 

[9] The district courts’ determinations of a reasonable fee

in each of these cases satisfied the Gisbrecht standards. 

[10] D. Once we conclude that the district court’s fee

determinations satisfied Gisbrecht, the remaining question is

whether the district court abused its discretion in setting the

fees. This court uses the “abuse of discretion” standard in

reviewing social security attorney fee awards. See Allen v.

Shalala, 48 F.3d 456, 457 (9th Cir. 1995) abrogated on other

grounds by Gisbrecht v. Barnhart, 535 U.S. 789 (2002). 

As the district court noted, it considered a number of factors. While those factors have been previously outlined in this

opinion, we again provide these factors to evidence the

amount of explanation the district courts provided. In Crawford, the court considered the experience, expertise, and reputation of the firm in determining an hourly fee and accepted

counsel’s estimate of the amount of time spent on the case.

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The court then applied the inflation rate counsel presented to

it and calculated a reasonable fee. Then the court increased

that fee by 40 percent because (a) there was not excessive

delay in getting the result and (b) plaintiff’s counsel was able

to persuade the Commissioner to stipulate to a remand which

ultimately resulted in a fully favorable decision. However, the

court would not increase it by 256 percent (the amount counsel requested), because plaintiff’s counsel did not provide him

the success rate data. After arriving at that figure, the court

then reduced the $21,000 claimed by plaintiff’s counsel to

that figure, saying “a substantial reduction is warranted.” 

In Washington, the court again considered the experience,

expertise, and reputation of the firm in calculating an hourly

fee and applied it to the amount of time that counsel had

requested. The court then applied the inflation rate counsel

had presented to it to calculate a reasonable fee. Then the

court increased the fee by 40 percent, because (a) the Commissioner stipulated to the remand, thereby sparing plaintiff

and his counsel of the need to research and prepare an exhaustive argument in support of the remand or award of benefits

and (b) there was no excessive delay in getting the result.

However, the court would not increase it by 82 percent (the

amount counsel requested), because (1) “counsel did not have

to do much work to persuade the Commissioner to stipulate

to a remand, and (2) it was very clear that the ALJ erred and

a remand was warranted,” therefore counsel “incurred very

little risk in this matter.” The court also rejected a comparison

between this case and securities litigation and wrote that

counsel “had not provided specific data regarding his particular success rate that enables the Court to assess the true risk

assumed by him.” 

In Trejo, the court did not accept counsel’s request for time

spent by the attorney or paralegal, instead adjusting the appropriate hours spent on the case. The court also adjusted the

inflation rate to be applied to an hourly fee. However, the

court calculated the hourly fee based on the experience,

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expertise, and reputation of the firm. The court then increased

the fee by 100 percent, because (a) the high quality of representation provided in the case, evidenced by the fact counsel

had convinced the Commissioner to stipulate to a remand

(which ultimately resulted in a fully favorable decision) in the

face of an adverse ALJ decision and (b) although there was

excessive delay, it was not due to Plaintiff’s counsel. However, the court would not increase the fee by 279 percent,

because (1) counsel provided no data regarding the law firm’s

success rate enabling the court to assess the risk assumed by

counsel; (2) there was no evidence her firm was precluded

from any other employment due to their acceptance of this

case; and (3) the case did not entail unduly short time limitations. After arriving at that figure, the court then reduced the

$24,000 (claimed by plaintiff’s counsel) to that figure, saying

“a further reduction is warranted.” 

[11] The selection and evaluation of the appropriate factors,

both pro and con, for determining a reasonable attorney fee in

a particular case involves the essence of discretionary action.

As the Supreme Court indicated, the district court’s determination of a reasonable fee ordinarily is entitled to “highly

respectful review.” Gisbrecht, 535 U.S. at 808. In setting reasonable fees in these cases, the district court did not abuse its

discretion. Unlike the dissent, we conclude that the opinions

of the magistrate judges who decided these cases adequately

explained the basis and reasons for their decisions. 

The orders of the district court awarding attorney fees in

these three cases are AFFIRMED. 

B. FLETCHER, Circuit Judge, dissenting: 

I respectfully dissent. In the majority opinion, the panel has

decided three discrete appeals because one overarching issue

controls all of them: Has the district court followed the manCRAWFORD v. ASTRUE 13705

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date of Gisbrecht v. Barnhart, 535 U.S. 789 (2002)? In that

case, the Supreme Court reversed the Ninth Circuit’s opinion

in Gisbrecht v. Apfel, 238 F.3d 1196 (9th Cir. 2000), disapproving fifteen years of Ninth Circuit practice regarding how

to determine attorney fees under 42 U.S.C. § 406(b)(1)(A).

By affirming the fee awards in these cases, the majority opinion effectively reinstates the Ninth Circuit’s same old methodology by permitting the district court to make adjustments

from the lodestar calculation rather than from the percent of

recovery specified in the contingent fee agreement. Further,

the majority ignores the basic principle that this court cannot

review for abuse of discretion but rather should remand for

explanation if the district court fails to explain its decision. 

I

We first used the lodestar method to determine a reasonable

fee under § 406 in Starr v. Bowen, 831 F.2d 872 (9th Cir.

1987). See Allen v. Shalala, 48 F.3d 456, 458 (9th Cir. 1995).

Under that method, the district court determined the reasonable fee by multiplying the reasonable hourly rate by the number of hours reasonably expended on the case. Gisbrecht, 238

F.3d at 1197-98. The district court could then adjust the

amount of the fee award by applying the twelve factors set out

in Kerr v. Screen Extras Guild, Inc., 526 F.2d 67, 70 (9th Cir.

1975), including “whether the fee is fixed or contingent.” Gisbrecht, 238 F.3d at 1198 (quoting Kerr, 526 F.2d at 70). 

Although the district court could consider the contingent

nature of the fee agreement, we repeatedly held that failure to

do so was not an abuse of discretion. See id. at 1199 (citing

Straw v. Bowen, 866 F.2d 1167, 1170 (9th Cir. 1989) and

other cases). In fact, although the district court was supposed

to consider a request to increase the award because of the contingent nature of the fee agreement, it was “not required to

articulate its reasons for accepting or rejecting such a

request.” Id. (internal quotations and citations omitted). 

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This approach was flatly rejected by the Supreme Court. It

held a district court charged with making a fee award under

§ 406(b)(1)(A) must respect “the primacy of lawful attorneyclient fee agreements,” Gisbrecht, 535 U.S. at 793, “looking

first to the contingent-fee agreement, then testing it for reasonableness,” id. at 808. The resulting award is unreasonable,

and thus subject to reduction by the court, if the attorney provided substandard representation or engaged in dilatory conduct, or if the “benefits are large in comparison to the amount

of time spent on the case.” Id. The attorney bears the burden

of establishing that the fee sought is reasonable. Id. at 807.

“[A]s an aid to the court’s assessment of the reasonableness

of the fee yielded by the fee agreement,” the attorney may

provide the court with a record of the hours worked and its

regular fee. Id. at 808. 

An examination of the fee awards in these cases makes it

starkly evident that the district courts did not respect the primacy of the attorney-client fee agreements. In each case, the

client signed a contract providing that the attorney would

receive 25% of the back pay awarded if benefits were

awarded following appeal to the district court. Had the district

court awarded the full contractual fee, the attorneys in these

cases would have received fees ranging from $19,010 to

$43,000. Instead, they received amounts ranging from

$8,825.53 to $12,650.40. These fee awards represented 6.68%

to 11.6% of the benefit awards. Put another way, the attorneys

received 53.57% to 73.3% less than the contingency contracts

provided.1

1The attorneys in these cases recognized that a full 25% fee would be

unreasonable. They therefore sought fees ranging from $11,500 to

$24,000, which represented 13.95% to 16.95% of the benefits awarded, a

substantial reduction from the amount contracted for. Although I do not

hold the view that where, as here, an attorney seeks less than 25% of the

back-benefits awarded, the fee request is presumptively reasonable, I

believe that the attorney’s request should be entitled to some deference in

such cases. I find it particularly problematic that the district court in CrawCRAWFORD v. ASTRUE 13707

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The language in each of the district court orders also makes

clear that the district court failed to apply the reasonableness

test mandated by Gisbrecht. Although the Gisbrecht court did

not provide a definitive list of what factors should be considered in determining whether a fee is reasonable or how those

factors should be weighed, the majority is wrong to conclude

that the Court “did not indicate how or on what basis the district courts were to determine that a fee was reasonable.” Maj.

Op. at 13697. Rather, the Supreme Court directed courts to

consider “the character of the representation and the results

the representative achieved” and to rely on the district court’s

expertise in making reasonableness determinations.2 Gisbrecht, 535 U.S. at 808. See also Mudd v. Barnhart, 418 F.3d

424, 428 (4th Cir. 2005) (“The [Supreme] Court did not provide a definitive list of factors to be considered because it recognized that the judges of our district courts are accustomed

to making reasonableness determinations in a wide variety of

contexts.” (quotation and alterations omitted)). The Supreme

Court also indicated that the district court could consider the

lodestar calculation, but only as an aid in assessing the reasonableness of the fee. See Gisbrecht, 535 U.S. at 808. The

lodestar cannot serve as the baseline for determining the fee.

ford reduced the fee sought by 60%. The attorney in that case requested

less than 17% of the back-benefits awarded—a substantial reduction from

what the contract provided for—and ultimately received less than 7% of

the claimant’s award. Although that figure represented a premium over the

lodestar, the fact that it was so much lower than the contracted-for amount

strongly suggests that the district court gave insufficient deference to the

fee agreement. 

2The majority improperly characterizes Gisbrecht as providing five distinct examples of ways to test for reasonableness. Maj. Op. at 13696.

Rather, Gisbrecht makes clear that the district court may reduce the fee

based on “the character of the representation and the results the representative achieved.” 535 U.S. at 808. Pursuant to this evaluation the court

may properly reduce the fee for substandard performance, delay, or benefits that are not in proportion to the time spent on the case. Id. As evidence

of the reasonableness of the resulting fee, the court may require the attorney to submit a record of hours spent and a statement of normal hourly

billing charges. Id.

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The majority correctly observes that the district court

orders quote extensively from Gisbrecht. The orders even cursorily discuss the character of the representation—noting that

it was skillful and not dilatory—before concluding that the

requested fee would represent a windfall to the attorneys. But

this sort of parroting of language from Gisbrecht does not

mean that the district courts actually applied its teachings. As

the orders make clear, the district courts in these cases started

with the lodestar calculation, and then adjusted slightly to

account for the contingent nature of the representation. This

is contrary to the Supreme Court’s clear directive that the district court must first look to the fee agreement and then adjust

downward to account for the particular lack of difficulty in

the representation. See id. See also Rodriquez v. Bowen, 865

F.2d 739, 746 (6th Cir. 1989) (en banc) (“In the event the

court chooses not to give effect to the terms of the agreement,

it should state for the record the deductions being made and

the reasons therefore.”). That the courts determined that the

fee agreements “met the § 406(b)(1) guidelines” does not

demonstrate that the district courts “recognized the primacy of

contingent-fee agreements”. Maj. Op. at 13701. Rather, it

merely shows that the courts acknowledged their existence.

Because the district courts did not give proper consideration

to the fee agreements and inverted the reasonableness analysis

prescribed by Gisbrecht, the fee orders in these cases should

be vacated, and the cases remanded for further consideration.

II

In addition to inverting the Gisbrecht analysis, each district

court failed to explain why it chose to enhance the lodestar

calculation by the factor that it did. The Supreme Court has

held that, although the district court has discretion to determine a reasonable fee, it must provide “a concise but clear

explanation of its reasons for the fee award.” Hensley v. Eckerhart, 461 U.S. 424, 437 (1983). If the district court fails to

do so, this court is unable to review the award for abuse of

discretion, and we must vacate and remand. See, e.g., Ferland

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v. Conrad Credit Corp., 244 F.3d 1145, 1151 (9th Cir. 2001);

Gates v. Deukmejian, 987 F.2d 1392, 1400 (9th Cir. 1992). 

Each district court explained on a general level the reason

for the reduction, concluding that the requested fee would

result in a windfall to the attorney because it was significantly

larger than the lodestar amount. Not only did each court start

from the wrong premise, each failed to give any explanation

for the particular fee awarded. Instead, each court increased

the lodestar by a percentage but failed to relate that percentage to the circumstances of the individual case. Under these

circumstances, our precedent requires that we remand for

reassessment of the fee request. Cf. Ferland, 244 F.3d at 1151

(“[T]he district court did not explain except at the most general level why it reduced by more than half the number of

attorney hours for which Ferland could be compensated, and

did not explain at all the particular level of reduction—from

261.2 to 120 hours—chosen. Because we cannot determine

the basis for the district court’s decision to so substantially

reduce the hours for which it permitted fees, we vacate the fee

award and remand for reassessment in accord with the principles discussed above.” (footnote omitted)).3

III

Finally, to the extent that the district court orders in Trejo

3Although both Ferland and Gates involved fee awards under feeshifting statutes, the basic principle that the district court must explain the

basis for its award applies with equal force in § 406(b) cases. The

Supreme Court made clear in Gisbrecht that reasonableness review in

§ 406(b) cases is essentially the same as reasonableness review in other

contexts. See Gisbrecht, 535 U.S. at 808. Additionally, several of our sister circuits have held that the basic principle that the district court must

explain its decision applies in these cases. McGuire v. Sullivan, 873 F.2d

974, 985 (7th Cir. 1989) (affirming where the district court “made specific

findings regarding the difficulty, riskiness and other relevant factors which

demonstrate that a twenty-five percent contingency contract is reasonable”); Rodriquez, 865 F.2d at 746. 

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and Crawford give some explanation of why the court did not

award the specific fee requested, that explanation was based

on a further misreading of Gisbrecht. Specifically, the orders

misconstrue the nature of the risk assessment by focusing on

the firm’s overall success rate instead of the specific facts that

make a given case more or less risky for the firm.4See, e.g.,

McGuire, 873 F.2d at 985. For example, in Crawford, the district court faulted the firm for failing to “provide[ ] any data

regarding [the] firm’s success rate that would enable the

Court to assess the risk assumed by [the] firm in representing

social security benefits claimants in the Central District of

California.” This misstates the attorney’s burden, which is to

show that the fee is reasonable based on the facts of the particular case. A district court cannot reduce the amount of a fee

simply because a firm is generally successful. Rather, the district court should look at the complexity and risk involved in

the specific case at issue to determine how much risk the firm

assumed in taking the case. The firm should not be penalized

for providing high-quality representation that frequently

results in success for its clients. 

IV

The majority opinion ignores the clear instructions of the

Supreme Court by affirming the district court’s reliance on

lodestar calculations in determining fee awards under

§ 406(b). It also undermines our precedent requiring that a

district court explain the reason for its fee award. Because the

Supreme Court has spoken in no uncertain terms to both of

these issues and instructed us not to affirm where the district

court bases its reasonable fee determination on a lodestar calculation or fails to adequately explain the reason for the

amount of the fee award, I would vacate the district court

orders and remand each of these cases for further proceedings.

4This is not the case in Washington where the magistrate noted that the

ALJ’s error was so clear that counsel did not have to work particularly

hard to get the government to stipulate to a remand. 

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