Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-4_13-cv-00336/USCOURTS-azd-4_13-cv-00336-1/pdf.json

Nature of Suit Code: 864
Nature of Suit: Social Security - SSID Title XVI
Cause of Action: 42:405 Review of HHS Decision (SSID)

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IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Roger Burke Anderson, 

Plaintiff, 

vs.

Carolyn W. Colvin, Acting Commissioner

of Social Security Administration, 

Defendant. 

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No. CV-13-00336-TUC-CRP

ORDER

On September 30, 2014, the Court filed an Order remanding this case to the

Commissioner for further proceedings. (Doc. 32, Order). Plaintiff through counsel has filed

a Motion for Attorney Fees Under the Equal Access to Justice Act (“EAJA”) (28 U.S.C. §

2412(d)) (Doc. 36, EAJA Motion) and Memorandum in Support (Doc. 37). Defendant has

filed an Objection to Plaintiff’s Motion for Attorney Fees (Doc. 38, Objection), and Plaintiff

has filed an EAJA Reply Brief (Doc. 39, EAJA Reply). Plaintiff’s attorney also has filed a

Motion for Attorney Fees Under 42 U.S.C. § 406(b) (Doc. 40, § 406(b) Motion) and Brief in

Support (Doc. 41), and Defendant has filed a Response (Doc. 42). This case is before the

Magistrate Judge based on the parties’ consent. (Doc. 23). 

I. Plaintiff’s Motion for Attorney’s Fees Under the EAJA

In the EAJA Motion, Plaintiff seeks $6,223.43 in attorney’s fees. (EAJA Motion at

1). Plaintiff has submitted the affidavits of the three attorneys who worked on the case and

Case 4:13-cv-00336-CRP Document 43 Filed 11/04/16 Page 1 of 8
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itemized statements showing the attorneys’ time on the case as 33.2 hours. (Doc. 37 at 7-8

& Ex. B, C & D). In the EAJA Reply, Plaintiff makes a supplemental request for $760.24

regarding four hours of additional attorney time for preparing the EAJA Reply, resulting in

a cumulative total request of $6,983.67. (EAJA Reply at 10-11). 

 Defendant contends in the Objection that the Commissioner’s decision was substantially

justified. Defendant asserts that, if the Court awards attorney fees, any award should be made

payable to Plaintiff rather than to Plaintiff’s counsel based on Astrue v. Ratliff, 560 U.S. 586

(2010), subject to offset under the Treasury Offset Program. 

Whether Plaintiff is Entitled to an Award of Attorney’s Fees

The EAJA provides that a prevailing party in a civil suit against the federal government

shall be awarded attorney’s fees unless the court finds that the government’s position was

substantially justified or that special circumstances make the award unjust. 28 U.S.C. §

2412(d)(1)(A). Defendant does not dispute Plaintiff’s prevailing party status or contend that

special circumstances make the award unjust. Defendant contends that the government’s

position was substantially justified. 

To meet the “substantially justified” standard under the EAJA, “the government must

advance a position that is ‘justified in substance or in the main – that is, justified to a degree

that could satisfy a reasonable person.’” Le v. Astrue, 529 F.3d 1200, 1201 (9th Cir. 2008)

(quoting United States v. Marolf, 277 F.3d 1156, 1161 (9th Cir. 2002)). “[T]he government’s

position must have a reasonable basis in law and fact” and “be substantially justified at each

stage of the proceedings.” Shafer v. Astrue, 518 F.3d 1067, 1071 (9th Cir. 2008). The court’s

inquiry is limited to the issues that led to remand. Hardisty v. Astrue, 592 F.3d 1072, 1078

(9th Cir. 2010). The Commissioner has the burden to show that its position was substantially

justified or that special circumstances exist to make an award unjust. Gutierrez v. Barnhart,

274 F.3d 1255, 1258 (9th Cir. 2001). Defendant contends her position was substantially

justified, that is, reasonable in law and fact, even though the Court found that remand was

necessary. 

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When deciding the merits, the Court found that the opinion expressed by Plaintiff’s

treating physiatrist Jon Ostrowski, M.D., had been improperly discounted by the

Administrative Law Judge (“ALJ”). Dr. Ostrowski had opined that Plaintiff could not

continue working as a dentist due to degenerative arthritis, degenerative disc disease, and

chronic neck problems. (Order at 5). The ALJ instead credited the findings of non-examining

state agency Doctors Kurtin and Falhberg who found that Plaintiff was not precluded from

performing a significant range of light work. (Id.). In the present Objection, Defendant agues

that the ALJ reasonably contrasted the limitations expressed by Dr. Ostrowski with those of

Doctors Kurtin and Falhberg. (Objection at 5-7). The Court found, however, that Defendant

cited no authority in arguing that the ALJ only needed to acknowledge that Dr. Ostrowski was

a treating physician in failing to reference him as a specialist, that the ALJ failed to state

specific and legitimate reasons for rejecting Dr. Ostrowski’s opinion, and Defendant argued

grounds on which the ALJ could have rejected Dr . Ostrowski’s opinion but did not. (Order

at 8). The Court found that Plaintiff had “correctly note[d] [that] it was neither logical nor

reasonable for the ALJ at step four to reject Dr. Ostrowski’s specific opinions relevant to the

performance of Plaintiff’s past work as a dentist on the grounds that the treating physician did

not opine that Plaintiff could not perform any activity at all.” (Order at 10). The Court further

found as an “unsound analysis” the ALJ’s finding that the State agency reviewers determined

that the exertional level generally performed by a dentist is light which Plaintiff is not

precluded from performing. “The opinion of a non-examining physician cannot by itself

constitute substantial evidence that justifies the rejection of the opinion of either an examining

physician or a treating physician.” Lester v. Chater, 81 F.3d 821, 831 (9th Cir. 1995). 

Finally, the ALJ’s comment that Dr. Ostrowski’s opinions were inconsistent with Dr.

Ostrowski’s observation that Plaintiff did not wish to pursue additional pain medication or

more aggressive treatment, or that Plaintiff had reported not taking pain medication regularly,

was not an appropriate standard for interpreting or rejecting Dr. Ostrowski’s opinion as to

Plaintiff’s existing impairments. (Order at 10-11). 

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Defendant argues in her Objection that the ALJ reasonably concluded that Plaintiff’s

daily activities contradicted his claims of debilitating impairment. (Objection at 8). In

determining that remand for further proceedings was appropriate, the Court noted that a

reassessment of Dr. Ostrowski’s opinion will impact the ALJ’s existing credibility finding.

(Order at 12). Defendant argues in her Objection that the ALJ properly considered the lay

testimony. (Objection at 8-9). However, the Court noted that Defendant “conced[ed] that lay

testimony cannot be rejected solely because it is unsupported by the medical evidence.”

(Order at 15). 

The government's defense of “basic and fundamental errors” cannot be considered as

substantially justified. Shafer , 518 F.3d at 1071–72 (holding, inter alia, that it was legal error

to discredit claimant's testimony without giving clear and convincing reasons and to reject a

treating physician's opinion without providing adequate reasons for doing so, and that the

Commissioner was not substantially justified in defending it). Because of the ALJ’s several

fundamental errors, Defendant’s position was not substantially justified.

Reasonableness of the Attorney Fees Request

Plaintiff’s attorney fees request is based on 33.2 hours of attorney time at the 2013 and

2014 hourly rates that correspond to the rates calculated by the Court of Appeals for the Ninth

Circuit. (EAJA Mem. at 7). Defendant has not objected to the hours of attorney time or to

the hourly rate. The Court finds that Plaintiff’s request for a total cumulative fee award of

$6,983.67, which includes the attorney time and fee amount for preparing the EAJA Reply,

is reasonable. Plaintiff’s Motion for Attorney Fees under the EAJA will be granted.

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Payment of Attorney Fees

Defendant contends that any award of EAJA attorney fees should be paid to Plaintiff

rather than to Plaintiff’s attorney. (Objection at 10-13). “EAJA fees are payable to litigants

and are thus subject to offset where a litigant has outstanding federal debts.” Ratliff, 560 U.S.

at 594. Defendant suggests the following payment procedure:

If, after receiving the Court’s EAJA fee order, the Commissioner (1) determines

that Plaintiff has assigned his right to EAJA fees to his attorney; (2) determines

that Plaintiff does not owe a debt that is subject to offset under the Treasury

Offset Program; and (3) agrees to waive the requirements of the AntiAssignment Act, then the EAJA fees will be made payable to Plaintiff’s

attorney. However, if there is a debt owed under the Treasury Offset Program,

the Commissioner cannot agree to waive the requirements of the AntiAssignment Act, and the remaining EAJA fees after offset will be paid by a

check made out to Plaintiff but delivered to Plaintiff’s attorney.

(Objection at 13, n.2). The EAJA fees award in this case is made subject to this procedure.

II. Plaintiff’s Attorney’s Motion for Attorney’s Fees Under 42 U.S.C. § 406(b)

Plaintiff’s counsel seeks $20,000 in attorney’s fees for representing Plaintiff on a

contingency fee basis. (Doc. 40, § 406(b) Motion). Plaintiff originally was represented by

attorney Phillip B. Verrette who filed this civil action and then withdrew. Plaintiff then was

represented by attorneys Patrick R. McNamara and Eric Schnaufer on the merits of the

litigation. Upon the Court’s reversal and remand for a rehearing, Plaintiff was found disabled

as of June 2009. Plaintiff’s counsel has submitted the Award Notice (Doc. 41-5, Ex. E), the

Contract for Attorney Representation (Doc. 41-1, Ex. A), and Attorney Time Records and

Affidavits (Doc. 41-2 through 4, Ex. B-D). Defendant has filed a Response stating no

position on this request for attorney fees.

Plaintiff retained counsel under a contract with a contingency fee agreement in which

Plaintiff “agree[d] that my attorney shall charge and receive as the fee an amount equal to

twenty-five percent (25%) of the” award of past due benefits. (Doc. 41-1, Ex. A). The

contract provided that the attorney fee must be approved by the federal court. (Id.). Defendant

has withheld $6,000 in attorney’s fees from Plaintiff’s past-due benefits award, noting that

$30,084.73 should have been withheld. (Doc. 41-5, Ex. E, Award Notice). 

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Under 42 U.S.C. § 406(b)(1)(A), when a claimant represented by counsel has received

a favorable judgment, “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[.]”

The Court “review[s] for reasonableness” the fee yielded by contingency fee agreements.

Gisbrecht v. Barnhart, 535 U.S. 789, 808-09 (2002). The Court may consider the character

of the representation, the results achieved, performance, delay, and whether the benefits are

in proportion to the time spent on the case. Crawford v. Astrue, 586 F.3d 1142, 1151 (9th Cir.

2009). 

The Social Security Administration determined that Plaintiff was owed $120,338.90

in past due benefits. (Doc. 41 at 8). Twenty-five percent of that amount is $30,084.73. (Id.).

The Social Security Administration did not withhold that amount. 

Plaintiff’s attorneys rely on 36.7 hours of service which results in an hourly rate of

approximately $544.96 based on the request for $20,000 in attorney fees. (Doc. 41 at 11). The

Court has considered counsel’s successful representation of Plaintiff, any delay in the

proceedings, the contingency fee agreement, and the risk inherent in a contingency fee

arrangement. 

Plaintiff’s counsel did not seek any extensions of time regarding the filing of his legal

memorandum in the proceedings before this Court. Plaintiff’s counsel asserted issues on the

merits which the Court found to be meritorious as previously discussed. The record provides

no reason for a reduction in the requested fee award on the basis of the character of counsel’s

representation, the results achieved, or delay in the proceedings attributable to Plaintiff’s

counsel. 

The record does not suggest any reason to question the propriety of the Contract for

Attorney Representation in this case. There is no showing that the fees requested exceed the

twenty-five percent cap. The Court is mindful of the contingent-fee nature of this case and

the risk imposed on counsel in agreeing to represent Plaintiff under such terms. 

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The fee sought must be reasonable “for the services rendered.” Gisbrecht, 535 U.S.

at 807. The reviewing court should not allow a “windfall.” Id. at 808. As noted in Gisbrecht,

“§ 406(b) does not displace contingent-fee agreements as the primary means by which fees

are set for successfully representing Social Security benefits claimants in court.” Id. at 807.

“Section 406(b) calls for court review of such arrangements as an independent check, to

assure that they yield reasonable results in particular cases.” Id. (footnote omitted). The

district court may reduce a § 406(b) award if “benefits ... are not in proportion to the time

spent on the case.” Crawford, 586 F.3d at 1151 (citing Gisbrecht, 535 U.S. at 808). “If the

benefits are large in comparison to the amount of time counsel spent on the case, a downward

adjustment is ... in order.” Gisbrecht, 535 U.S. at 808. 

The retroactive benefits award is not large in comparison to the 36.7 hours counsel

spent on the case. Plaintiff’s counsel states that Mr. McNamara’s per hour non-contingent rate

is $400. (Doc. 41 at 11, n. 5). Mr. McNamara has more than 30 years of experience. (Id.).

Mr. Schnaufer has more than 20 years of experience. (Id.). The hourly rate for attorneys with

20 to 30 years of experience in the Mountain Region is $440. (Id.). 

The Court, in its discretion and taking into account counsel’s risk involved in the

contingency fee arrangement in this case, finds that counsel’s fee request is reasonable.

Plaintiff’s counsel is awarded a total fee amount of $20,000 under § 406(b). 

Accordingly,

IT IS ORDERED that Plaintiff’s Motion for Attorney Fees Under the Equal Access

to Justice Act (Doc. 36) is granted and Plaintiff is awarded $6,983.67 in attorney’s fees. 

IT IS FURTHER ORDERED that if, after receiving the Court’s EAJA fees order,

the Commissioner (1) determines that Plaintiff has assigned his right to EAJA fees to his

attorney; (2) determines that Plaintiff does not owe a debt that is subject to offset under the

Treasury Offset Program; and (3) agrees to waive the requirements of the Anti-Assignment

Act, the fees will be made payable to Plaintiff’s attorney. However, if there is a debt owed

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under the Treasury Offset Program, the remaining EAJA fees after offset shall be paid by

check made out to Plaintiff but delivered to Plaintiff’s attorney. 

IT IS FURTHER ORDERED that Plaintiff’s Attorney’s Motion for Attorney Fees

Under 42 U.S.C. § 406(b) (Doc. 40) is granted to the extent that counsel is awarded $20,000

in attorney’s fees.

IT IS FURTHER ORDERED that Plaintiff’s counsel shall refund to Plaintiff the

lesser of the fees awarded under 42 U.S.C. § 406(b) and the Equal Access to Justice Act.

DATED this 3rd day of November, 2016.

Case 4:13-cv-00336-CRP Document 43 Filed 11/04/16 Page 8 of 8