Case Name in Social Security Case - Unavailable

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UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF TEXAS
SHERMAN DIVISION
MELISSA HALSTEAD
v.
COMMISSIONER, SSA
§
§
§
§
§
CIVIL NO. 4:20-CV-674-SDJ
MEMORANDUM OPINION AND ORDER
Before the Court is Plaintiff’s counsel’s Motion for and Memorandum in
Support of an Award of Attorney Fees Under 406(b) of the Social Security Act.
(Dkt. #28). Defendant, the Commissioner of Social Security, filed a response to the
motion, although the Commissioner “neither supports nor opposes counsel’s request
for attorney’s fees . . . under 42 U.S.C. § 406(b).” (Dkt. #30). Having considered the
motion, the Court concludes that it should be granted.
I. B ACKGROUND
Plaintiff Melissa Halstead filed this action seeking judicial review of the
Commissioner’s decision denying her application for benefits under Title II of the
Social Security Act. (Dkt. #1). Upon the Commissioner’s motion, (Dkt. #20), the Court
reversed the Commissioner’s final decision and remanded this action for further
administrative proceedings pursuant to 42 U.S.C. § 405(g). (Dkt. #21). The Court
subsequently awarded $6,547.05 in attorney’s fees and $400.00 in costs pursuant to
the Equal Access to Justice Act (“EAJA”). (Dkt. #25, #26, #27). On remand, the Social
Security Administration found that Halstead was entitled to $125,406.00 in past-due
benefits, 	from 	which 	$31,351.50 	was 	withheld 	for 	payment 	of 	attorney’s 	fees.
(Dkt. #28-2 at 4–5). Plaintiff’s attorney of record now seeks a fee authorization in the
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amount of $31,351.50 pursuant to 42 U.S.C. § 406(b) for services rendered in this
matter. (Dkt. #28).1
II. LEGAL STANDARD
Pursuant to 42 U.S.C. § 406(b)(1)(A), when a court “renders a judgment
favorable to a claimant . . . who was represented before the court by an attorney,” the
court may award “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[.]” A remand that ultimately results in an award of benefits is a judgment
that is favorable to a claimant. Jackson v. Astrue, 705 F.3d 527, 531 (5th Cir. 2013).
“Fees under [Section] 406(b) satisfy a client’s obligation to his or her counsel
and, accordingly, are paid out of the plaintiff’s social security benefits.” Siebe v.
Comm’r of Soc. Sec. Admin., No. 5:19-CV-30, 2021 WL 3493167, at *1 (E.D. Tex.
Apr. 16, 2021). A contingency fee agreement may set the amount of Section 406(b)
fees so long as (1) the amount complies with Section 406(b)’s 25% cap and (2) the
amount is reasonable under the facts of the case—i.e., it does not result in a windfall
for the attorney. Gisbrecht v. Barnhart, 535 U.S. 789, 807–08, 122 S.Ct. 1817,
1 The Court granted Plaintiff leave to file a motion for Section 406(b) fees once she
completed the administrative process on remand. (Dkt. #24). Plaintiff’s counsel has now filed
the Section 406(b) motion. (Dkt. #28). Therein, Plaintiff’s counsel states that “[t]his motion is
timely as the administrative process was just recently completed.” (Dkt. #28 at 1).
However, the administrative process was completed on January 5, 2025, (Dkt. #28-2),
and Plaintiff’s counsel did not file this motion until November 17, 2025—more than
10 months after the administrative process concluded. Given this delay, the Court reminds
Plaintiff’s counsel that he has a duty to “act with reasonable diligence and promptness in
representing a client,” M ODEL RULES OF PRO . CONDUCT r. 1.3 (A.B.A. 2025), and that he has
an obligation of candor towards the Court, id. at r. 3.3.
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152 L.Ed.2d 996 (2002); see also id. at 808 (“Although the contingency agreement
should be given significant weight in fixing a fee, a district judge must independently
assess the reasonableness of its terms.” (quoting McGuire v. Sullivan, 873 F.2d 974,
983 (7th Cir. 1989))).
The Fifth Circuit has identified several factors that courts may consider when
determining whether an award is reasonable or whether it results in a windfall,
including: “risk of loss in the representation, experience of the attorney, percentage
of the past-due benefits the fee constitutes, value of the case to a claimant, degree of
difficulty, and whether the client consents to the requested fee.” Jeter v. Astrue,
622 F.3d 371, 382 (5th Cir. 2010) (citation omitted). Courts should also consider
whether the attorney unnecessarily delayed the litigation. Id. at 380 n.10 (citing
Gisbrecht, 535 U.S. at 808).
A prevailing claimant may collect fees under both Section 406(b) and the
EAJA, “but the claimant’s attorney must refund to the claimant the amount of the
smaller fee.” Gisbrecht, 535 U.S. at 796 (citation modified).
III. D ISCUSSION
Here, Plaintiff’s counsel requests $31,351.50 for his 32.60 hours of work in this
Court, to be paid from Plaintiff’s $125,406.00 in past-due benefits. (Dkt. #28 at 2);
(Dkt. #28-3); (Dkt. #28-6 ¶ 4). This request complies with Section 406(b)’s 25%
maximum. And, pursuant to counsel and Plaintiff’s fee agreement, Plaintiff agreed to
pay counsel “a fee of twenty-five percent (25%) of the past due benefits awarded[.]”
(Dkt. #28-4 ¶ 7).
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Having reviewed the motion and the circumstances of this case, the Court finds
that the requested amount is reasonable. Plaintiff’s counsel has nearly thirty years
of experience with Social Security law and is board-certified in Social Security
Disability Advocacy by the National Board of Trial Advocacy.2 (Dkt. #28-6 ¶ 1). The
requested amount does not exceed the statutorily prescribed maximum for fees, it is
consistent with the contingency agreement, counsel’s representation resulted in a
fully favorable result for Plaintiff, and there appears to be no significant delay in this
litigation caused by counsel. Further, Plaintiff’s counsel accepted risk in agreeing to
represent Plaintiff. And although the Commissioner—not Plaintiff—moved for the
remand, it did so only after Plaintiff filed a brief explaining the errors at the
administrative level. See (Dkt. #18, #20). For these reasons, the requested amount
will not result in a windfall for Plaintiff’s counsel.
Additionally, although the effective hourly rate requested here, $961.70,3 is
about 2.08 times counsel’s average market rate of $463.00, (Dkt. #28 at 10), this
quotient does not necessarily mean the award is unreasonable. The Fifth Circuit has
instructed against punishing “experienced, competent counsel . . . for accomplishing
an arduous task in a shorter span of time[.]” Jeter, 622 F.3d at 380–81. In this regard,
Gisbrecht’s “windfall” concern “does not preclude attorneys from recovering what may
2 Plaintiff’s attorney, Michael T. Kelly, indicates that a second attorney, Martin W.
Long, also worked on this case. (Dkt. #28-6 ¶ 4). Martin Long has approximately thirty years
of experience with Social Security law, and was previously employed as an Assistant Regional
Counsel for the Office of the General Counsel, U.S. Social Security Administration.
3 The effective hourly rate is calculated by dividing the amount requested by the
number of hours worked. Here, that calculation is: $31,351.50 ÷ 32.60 = $961.70/hour.
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mathematically seem like a high fee award if the attorney’s success on appeal is of
his own making.” Id. at 381. Here, as discussed, Plaintiff’s counsel diligently
represented Plaintiff. See (Dkt. #18, #20).
Finally, the proposed award is within the range of awards that this Court and
other courts have found to be reasonable. See Rife v. Comm’r of Soc. Sec. Admin., No.
4:21-CV-197 (E.D. Tex. Apr. 26, 2024), (Dkt. #43) (awarding counsel an effective
hourly rate of $1,108.19); see also Silves H. v. Kijakazi, No. 3:22-CV-286, 2023 WL
9102228, at *3 (N.D. Tex. Dec. 18, 2023) (recommending that counsel be awarded an
effective hourly rate of $1,070.33), report and recommendation adopted, 2024 WL
56989 (N.D. Tex. Jan. 4, 2024); Seznik v. Comm’r of Soc. Sec. Admin., No. 3:20-CV-
2574, 2023 WL 6066466, at *2–3 (N.D. Tex. July 17, 2023) (recommending that
counsel be awarded an effective hourly rate of $1,237.62), report and recommendation
adopted, 2023 WL 6065871 (N.D. Tex. Aug. 9, 2023); Sabourin v. Colvin, No. 3:11-
CV-2109, 2014 WL 3949506, at *1–2 (N.D. Tex. Aug. 12, 2014) (awarding counsel an
effective hourly rate of $1,245.55).
Based on the foregoing, the Court finds that Plaintiff’s counsel’s motion for an
award of $35,351.50 is reasonable. And, as Plaintiff’s counsel acknowledges, he is
obligated to refund the lesser EAJA fee amount of $6,547.05 directly to Plaintiff.
(Dkt. #28 at 11).
IV. C ONCLUSION
For the foregoing reasons, it is ORDERED that Plaintiff’s counsel’s Motion for
and Memorandum in Support of an Award of Attorney Fees Under 406(b) of the Social
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Security Act, (Dkt. #28), is GRANTED. Plaintiff’s attorney, Michael T. Kelly, is
awarded $35,351.50 in attorney’s fees to be certified for payment out of Plaintiff’s
past-due benefits under 42 U.S.C. § 406(b), from the benefits having been withheld
from Plaintiff and retained by the Commissioner for that purpose. Upon receipt of the
attorney’s fees, Plaintiff’s attorney shall remit directly to Plaintiff $6,547.05, which
the Court previously awarded under the Equal Access to Justice Act, (Dkt. #27).
The clerk is directed to CLOSE this case.
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