GISBRECHT et al. v. BARNHART, COMMISSIONER OF SOCIAL SECURITY

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789 OCTOBER TERM, 2001
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GISBRECHT et al. v. BARNHART, COMMISSIONER
OF SOCIAL SECURITY
certiorari to the united states court of appeals for
the ninth circuit
No. 01–131. Argued March 20, 2002—Decided May 28, 2002
An attorney who successfully represents a Social Security benefits claim-
ant in court may be awarded as part of the judgment “a reasonable
fee . . . not in excess of 25 percent of the . . . past-due benefits” awarded
to the claimant. 42 U. S. C. § 406(b)(1)(A). The fee is payable “out of,
and not in addition to, the amount of [the] past-due benefits.” Ibid. In
many cases, as in the instant case, the Equal Access to Justice Act
(EAJA) effectively increases the portion of past-due benefits the suc-
cessful Social Security claimant may pocket. Under EAJA, a party
prevailing against the United States in court may be awarded fees pay-
able by the United States if the Government’s position in the litigation
was not “substantially justified.” 28 U. S. C. § 2412(d)(1)(A). Congress
harmonized fees payable by the Government under EAJA with fees
payable under § 406(b) out of the Social Security claimant’s past-due ben-
efits: Fee awards may be made under both prescriptions, but the claim-
ant’s attorney must refund to the claimant the amount of the smaller
fee, up to the point the claimant receives 100 percent of the past-due
benefits.
Petitioners Gisbrecht, Miller, and Sandine brought separate actions in
the District Court seeking Social Security disability benefits under Title
II of the Social Security Act. All three were represented by the same
attorneys and prevailed on the merits of their claims. Each petitioner
then successfully sought attorneys’ fees under EAJA. Pursuant to
contingent-fee agreements standard for Social Security claimant repre-
sentation, each petitioner had agreed to pay counsel 25 percent of all
past-due benefits recovered. Their attorneys accordingly requested
$7,091.50 from Gisbrecht’s recovery, $7,514 from Miller’s, and $13,988
from Sandine’s. Given the EAJA offsets, the amounts in fact payable
from each client’s past-due benefits recovery would have been $3,752.39
from Gisbrecht’s recovery, $2,349.25 from Miller’s, and $7,151.90 from
Sandine’s. Following Ninth Circuit precedent, the District Court in
each case declined to give effect to the attorney-client fee agreement,
instead employing a “lodestar” method, under which the number of
hours reasonably devoted to each case was multiplied by the reasonable
hourly fee. This method yielded as § 406(b) fees $3,135 from Gisbrecht’s

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recovery, $5,461.50 from Miller’s, and $6,550 from Sandine’s. Offsetting
the EAJA awards against the lodestar determinations, the court de-
termined that no portion of Gisbrecht’s or Sandine’s past-due benefits
was payable to counsel, and that only $296.75 of Miller’s recovery was
payable to her counsel. The Ninth Circuit consolidated the cases and
affirmed.
Held: Section 406(b) does not displace contingent-fee agreements within
the statutory ceiling; instead, § 406(b) instructs courts to review for rea-
sonableness fees yielded by those agreements. Pp. 799–809.
(a) Section 406(b)’s words, read in isolation, could be construed
to allow either the Ninth Circuit’s lodestar approach or petitioners’
position that the attorney-client fee agreement should control, if not
“in excess of 25 percent of . . . the past-due benefits.” Because the
statute’s text is inconclusive, this Court takes into account, as inter-
pretive guides, the origin and standard application of the proffered
approaches. Pp. 799–800.
(b) The lodestar method, though rooted in accounting practices
adopted in the 1940’s, did not gain a firm foothold in the federal courts
until the mid-1970’s. The lodestar method today holds sway in federal-
court adjudication of disputes over the amount of fees properly shifted
to the loser in the litigation. Fees shifted to the losing party, however,
are not at issue here. Pp. 800–802.
(c) Section 406(b) authorizes fees payable from the successful party’s
recovery. Characteristically in Social Security benefits cases, attorneys
and clients enter into contingent-fee agreements specifying that the at-
torney’s fee will be 25 percent of any past-due benefits to which the
claimant becomes entitled. Contingent-fee arrangements, though prob-
lematic, particularly when not exposed to court review, are common in
the United States in many settings, and Social Security representation
operates largely on a contingent-fee basis. Before 1965, the Social
Security Act imposed no limits on contingent-fee agreements drawn by
counsel and signed by benefits claimants. Arrangements yielding exor-
bitant fees reserved for lawyers one-third to one-half of the accrued
benefits; the longer the litigation persisted, the greater the buildup of
past-due benefits and, correspondingly, of legal fees awardable from
those benefits if the claimant prevailed. Attending to these realities,
Congress provided for a reasonable fee, not in excess of 25 percent of
accrued benefits, as part of the court’s judgment, and specified that no
other fee would be payable. Violation of these limitations was made a
criminal offense. In addition to protecting claimants against inordi-
nately large fees, Congress sought to ensure that attorneys successfully
representing Social Security claimants would not risk nonpayment by

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their clients. Congress therefore authorized agency payment of fees
directly to counsel from funds withheld from the claimant’s past-due
benefits. But nothing in § 406(b)’s text or history reveals a design to
prohibit or discourage attorneys and claimants from entering into
contingent-fee agreements. Given the prevalence of such agreements
between attorneys and Social Security benefits claimants, it is unlikely
that Congress, simply by prescribing “reasonable fees,” meant to outlaw,
rather than to contain, the fee agreements. Pp. 802–805.
(d) This conclusion is bolstered by Congress’ 1990 authorization of
contingent-fee agreements under § 406(a), which governs fees for
agency-level representation. It would be anomalous if contract-based
fees expressly authorized by § 406(a)(2) at the administrative level were
disallowed for court representation under § 406(b). It is also unlikely
that Congress, legislating in 1965, intended to install a lodestar method
that courts did not develop and employ until years later. Furthermore,
the lodestar method was designed to govern imposition of fees on the
losing party. In such cases, nothing prevents the attorney for the pre-
vailing party from gaining additional fees, pursuant to contract, from
his own client. But § 406(b) governs the total fee a successful Social
Security claimant’s attorney may receive for court representation.
Nothing more may be demanded or received from the benefits claim-
ant. Pp. 805–807.
(e) Most plausibly read, § 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. Rather,
§ 406(b) calls for court review of such arrangements to assure that they
yield reasonable results in particular cases. Within the 25 percent
boundary Congress provided, the attorney for the successful claimant
must show that the fee sought is reasonable for the services rendered.
Courts have reduced the attorney’s recovery based on the character of
the representation and the results the representative achieved. If the
attorney is responsible for delay, for example, a reduction is in order so
that the attorney will not profit from the accumulation of benefits during
the pendency of the case in court. And if the benefits are large in
comparison to the amount of time counsel spent on the case, a downward
adjustment is similarly in order. Pp. 807–808.
238 F. 3d 1196, reversed and remanded.
Ginsburg, J., delivered the opinion of the Court, in which Rehnquist,
C. J., and Stevens, O’Connor, Kennedy, Souter, Thomas, and Breyer,
JJ., joined. Scalia, J., filed a dissenting opinion, post, p. 809.

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792 GISBRECHT v. BARNHART
Opinion of the Court
Eric Schnaufer argued the cause for petitioners. With
him on the briefs were Eric Schnapper and Tim Wilborn.
David B. Salmons argued the cause pro hac vice for re-
spondent. With him on the brief were Solicitor General
Olson, Assistant Attorney General McCallum, Deputy So-
licitor General Clement, William Kanter, and Frank A.
Rosenfeld.*
Justice Ginsburg delivered the opinion of the Court.
This case concerns the fees that may be awarded attorneys
who successfully represent Social Security benefits claimants
in court. Under 42 U. S. C. § 406(b) (1994 ed. and Supp. V),1
a prevailing claimant’s fees are payable only out of the bene-
fits recovered; in amount, such fees may not exceed 25 per-
cent of past-due benefits. At issue is a question that has
sharply divided the Federal Courts of Appeals: What is the
appropriate starting point for judicial determinations of
“a reasonable fee for [representation before the court]”?
See ibid. Is the contingent-fee agreement between claimant
and counsel, if not in excess of 25 percent of past-due bene-
fits, presumptively reasonable? Or should courts begin with
a lodestar calculation (hours reasonably spent on the case
times reasonable hourly rate) of the kind we have approved
under statutes that shift the obligation to pay to the loser in
the litigation? See Hensley v. Eckerhart, 461 U. S. 424, 426
(1983) (interpreting Civil Rights Attorney’s Fees Awards
Act of 1976, 42 U. S. C. § 1988, which allows a “prevailing
party” to recover from his adversary “a reasonable attor-
*Jeffrey Robert White filed a brief for the Association of Trial Lawyers
of America as amicus curiae urging reversal.
Daniel J. Popeo and Richard A. Samp filed a brief for the Washington
Legal Foundation et al. as amici curiae urging affirmance.
Nancy G. Shor, Kirk B. Roose, Joel F. Friedman, Robert E. Rains, and
Eric Buchanan filed a brief for the National Organization of Social Secu-
rity Claimants’ Representatives as amicus curiae.
1 49 Stat. 624, as amended.

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ney’s fee as part of the costs” (internal quotation marks
omitted)).
Congress, we conclude, designed § 406(b) to control, not
to displace, fee agreements between Social Security benefits
claimants and their counsel. Because the decision before us
for review rests on lodestar calculations and rejects the pri-
macy of lawful attorney-client fee agreements, we reverse
the judgment below and remand for recalculation of counsel
fees payable from the claimants’ past-due benefits.
I
A
Fees for representation of individuals claiming Social Se-
curity old-age, survivor, or disability benefits, both at the
administrative level and in court, are governed by prescrip-
tions Congress originated in 1965. Social Security Amend-
ments of 1965, 79 Stat. 403, as amended, 42 U. S. C. § 406.2
2 Before 1965, Congress did not explicitly authorize attorney’s fees for
in-court representation of Social Security benefits claimants. At least
two Courts of Appeals, however, concluded that 42 U. S. C. § 405(g) implic-
itly authorized such fees. See Bowen v. Galbreath, 485 U. S. 74, 75–76
(1988) (citing Celebrezze v. Sparks, 342 F. 2d 286 (CA5 1965)) (“Under 42
U. S. C. § 405(g), a court reviewing [a Social Security benefits decision] has
the power to enter ‘a judgment affirming, modifying, or reversing the
decision . . . .’ The court in Sparks reasoned that where a statute gives
a court jurisdiction, it must be presumed, absent any indication to the
contrary, that the court was intended to exercise all the powers of a court,
including the power to provide for payment of attorney’s fees out of any
recovery. 342 F. 2d, at 288–289 [citing Folsom v. McDonald, 237 F. 2d
380, 382–383 (CA4 1956)].”).
As to administrative proceedings, the Social Security Act originally
made no provision for attorney’s fees. 49 Stat. 620 (1935). Four years
later, Congress amended the Act to permit the Social Security Board to
prescribe maximum fees attorneys could charge for representation of
claimants before the agency. Social Security Act Amendments of 1939,
53 Stat. 1360. Congress expected the need for counsel in agency proceed-
ings to be slim. H. R. Rep. No. 728, 76th Cong., 1st Sess., 44–45 (1939);
S. Rep. No. 734, 76th Cong., 1st Sess., 53 (1939). The Board subsequently
established a maximum fee of $10, permitting a higher fee only by petition

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The statute deals with the administrative and judicial review
stages discretely: § 406(a) governs fees for representation in
administrative proceedings; § 406(b) controls fees for repre-
sentation in court. See also 20 CFR § 404.1728(a) (2001).
For representation of a benefits claimant at the adminis-
trative level, an attorney may file a fee petition or a fee
agreement. 42 U. S. C. § 406(a). In response to a petition,
the agency may allow fees “for services performed in connec-
tion with any claim before” it; if a determination favorable
to the benefits claimant has been made, however, the Com-
missioner of Social Security “shall . . . fix . . . a reasonable
fee” for an attorney’s services. § 406(a)(1) (1994 ed.) (empha-
sis added). In setting fees under this method, the agency
takes into account, in addition to any benefits award, several
other factors. See 20 CFR § 404.1725(b) (2001).3 Fees may
to the agency. 20 CFR § 403.713(d) (1949). The agency later prescribed
separate fees for representation at the initial and appellate levels of the
administrative process. 20 CFR § 404.976 (1961).
3 Title 20 CFR § 404.1725(b) provides:
“Evaluating a request for approval of a fee.
“(1) When we evaluate a representative’s request for approval of a fee,
we consider the purpose of the social security program, which is to provide
a measure of economic security for the beneficiaries of the program, to-
gether with—
“(i) The extent and type of services the representative performed;
“(ii) The complexity of the case;
“(iii) The level of skill and competence required of the representative
in giving the services;
“(iv) The amount of time the representative spent on the case;
“(v) The results the representative achieved;
“(vi) The level of review to which the claim was taken and the level of
the review at which the representative became your representative; and
“(vii) The amount of fee the representative requests for his or her serv-
ices, including any amount authorized or requested before, but not includ-
ing the amount of any expenses he or she incurred.
“(2) Although we consider the amount of benefits, if any, that are pay-
able, we do not base the amount of fee we authorize on the amount of the
benefit alone, but on a consideration of all the factors listed in this section.
The benefits payable in any claim are determined by specific provisions

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be authorized, on petition, even if the benefits claimant was
unsuccessful. § 404.1725(b)(2).
As an alternative to fee petitions, the Social Security Act,
as amended in 1990, accommodates contingent-fee agree-
ments filed with the agency in advance of a ruling on the
claim for benefits. Omnibus Budget Reconciliation Act of
1990, 104 Stat. 1388–266 to 1388–267, as amended, 42 U. S. C.
§§ 406(a)(2)–(4) (1994 ed. and Supp. V). If the ruling on the
benefits claim is favorable to the claimant, the agency will
generally approve the fee agreement, subject to this limita-
tion: Fees may not exceed the lesser of 25 percent of past-due
benefits or $4,000 (increased to $5,300 effective February
2002). §§ 406(a)(2)(A)(ii), (iii) (1994 ed.); 67 Fed. Reg. 2477
(2002); see Social Security Administration, Office of Hearings
and Appeals, Litigation Law Manual (HALLEX) I–5–109
III.A (Feb. 5, 1999).
For proceedings in court, Congress provided for fees on
rendition of “a judgment favorable to a claimant.” 42
U. S. C. § 406(b)(1)(A) (1994 ed., Supp. V). The Commis-
sioner has interpreted § 406(b) to “prohibi[t] a lawyer from
charging fees when there is no award of back benefits.”
Tr. of Oral Arg. 37–38; see Brief in Opposition 12, n. 12 (read-
ing § 406(b) to “prohibi[t] other [fee] arrangements such as
non-contingent hourly fees”).
As part of its judgment, a court may allow “a reasonable
fee . . . not in excess of 25 percent of the . . . past-due bene-
fits” awarded to the claimant. § 406(b)(1)(A). The fee is
payable “out of, and not in addition to, the amount of [the]
past-due benefits.” Ibid. Because benefits amounts fig-
uring in the fee calculation are limited to those past due, at-
torneys may not gain additional fees based on a claimant’s
continuing entitlement to benefits.
The prescriptions set out in §§ 406(a) and (b) establish the
exclusive regime for obtaining fees for successful represen-
of law and are unrelated to the efforts of the representative. We may
authorize a fee even if no benefits are payable.”

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tation of Social Security benefits claimants. Collecting or
even demanding from the client anything more than the au-
thorized allocation of past-due benefits is a criminal offense.
§§ 406(a)(5), (b)(2) (1994 ed.); 20 CFR §§ 404.1740–1799 (2001).
In many cases, as in the instant case, the Equal Access to
Justice Act (EAJA), enacted in 1980, effectively increases
the portion of past-due benefits the successful Social Secu-
rity claimant may pocket. 94 Stat. 2329, as amended, 28
U. S. C. § 2412. Under EAJA, a party prevailing against the
United States in court, including a successful Social Security
benefits claimant, may be awarded fees payable by the
United States if the Government’s position in the litigation
was not “substantially justified.” § 2412(d)(1)(A). EAJA
fees are determined not by a percent of the amount re-
covered, but by the “time expended” and the attorney’s
“[hourly] rate,” § 2412(d)(1)(B), capped in the mine run of
cases at $125 per hour, § 2412(d)(2)(A).4 Cf. 5 U. S. C. § 504
(authorizing payment of attorney’s fees by the Government
when a party prevails in a federal agency adjudication).
Congress harmonized fees payable by the Government
under EAJA with fees payable under § 406(b) out of the
claimant’s past-due Social Security benefits in this manner:
Fee awards may be made under both prescriptions, but the
claimant’s attorney must “refun[d] to the claimant the
amount of the smaller fee.” Act of Aug. 5, 1985, Pub. L.
99–80, § 3, 99 Stat. 186. “Thus, an EAJA award offsets an
award under Section 406(b), so that the [amount of the total
past-due benefits the claimant actually receives] will be in-
creased by the . . . EAJA award up to the point the claimant
receives 100 percent of the past-due benefits.” Brief for
United States 3.
4 A higher fee may be awarded if “the court determines that an increase
in the cost of living or a special factor, such as the limited availability of
qualified attorneys for the proceeding involved, justifies a higher fee.” 28
U. S. C. § 2412(d)(2)(A)(ii).

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B
Petitioners Gary Gisbrecht, Barbara Miller, and Nancy
Sandine brought three separate actions in the District Court
for the District of Oregon under 42 U. S. C. § 405(g) (1994
ed.),5 seeking Social Security disability benefits under
Title II of the Social Security Act. All three petitioners
were represented by the same attorneys, and all three pre-
vailed on the merits of their claims. Gisbrecht was awarded
$28,366 in past-due benefits; Miller, $30,056; and San-
dine, $55,952. Each petitioner then successfully sought
attorneys’ fees payable by the United States under EAJA:
Gisbrecht was awarded $3,339.11, Miller, $5,164.75, and
Sandine, $6,836.10.
Pursuant to contingent-fee agreements standard for Social
Security claimant representation, see 1 B. Samuels, Social
Security Disability Claims § 21:10 (2d ed. 1994), Gisbrecht,
Miller, and Sandine had each agreed to pay counsel 25 per-
cent of all past-due benefits recovered, App. to Pet. for Cert.
72–86. Their attorneys accordingly requested § 406(b) fees
of $7,091.50 from Gisbrecht’s recovery, $7,514 from Miller’s,
and $13,988 from Sandine’s. Given the EAJA offsets, the
amounts in fact payable from each client’s past-due benefits
recovery would have been $3,752.39 from Gisbrecht’s recov-
ery, $2,349.25 from Miller’s, and $7,151.90 from Sandine’s.
Following Circuit precedent, see Allen v. Shalala, 48 F. 3d
456, 458–459 (CA9 1995), the District Court in each case de-
clined to give effect to the attorney-client fee agreement.
Gisbrecht v. Apfel, No. CV–98–0437–RE (Ore., Apr. 14, 1999);
Miller v. Apfel, No. CV–96–6164–AS (Ore., Mar. 30, 1999);
Sandine v. Apfel, No. CV–97–6197–ST (Ore., June 18, 1999).
Instead, the court employed for the § 406(b) fee calculation a
“lodestar” method, under which the number of hours reason-
ably devoted to each case was multiplied by a reasonable
5 Section 405(g) authorizes judicial review of administrative denials of
applications for Social Security benefits.

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hourly fee. This method yielded as § 406(b) fees $3,135 from
Gisbrecht’s recovery, $5,461.50 from Miller’s, and $6,550 from
Sandine’s. Offsetting the EAJA awards, the court deter-
mined that no portion of Gisbrecht’s or Sandine’s past-due
benefits was payable to counsel, and that only $296.75 of Mill-
er’s recovery was payable to her counsel as a § 406(b) fee.
The three claimants appealed.6
Adhering to Circuit precedent applying the lodestar
method to calculate fees under § 406(b), the Court of Appeals
for the Ninth Circuit consolidated the cases 7 and affirmed
the District Court’s fee dispositions. Gisbrecht v. Apfel, 238
F. 3d 1196 (2000). The Appeals Court noted that fees deter-
mined under the lodestar method could be adjusted by apply-
ing 12 further factors, one of them, “whether the fee is fixed
or contingent.” Id., at 1198 (quoting Kerr v. Screen Extras
Guild, Inc., 526 F. 2d 67, 70 (CA9 1975)).8 While “a district
6 Although the claimants were named as the appellants below, and are
named as petitioners here, the real parties in interest are their attorneys,
who seek to obtain higher fee awards under § 406(b). For convenience,
we nonetheless refer to claimants as petitioners. See Hopkins v. Cohen,
390 U. S. 530, 531, n. 2 (1968). We also note that the Commissioner of
Social Security here, as in the Ninth Circuit, has no direct financial stake
in the answer to the § 406(b) question; instead, she plays a part in the fee
determination resembling that of a trustee for the claimants. See, e. g.,
Lewis v. Secretary of Health and Human Servs., 707 F. 2d 246, 248
(CA6 1983).
7 A fourth case, Anderson v. Apfel, No. CV–96–6311–HO (Ore., Sept. 29,
1999), was also consolidated with petitioners’ cases; we denied certiorari
in Anderson in the order granting certiorari on petitioners’ question. See
534 U. S. 1039 (2001).
8 Kerr directed consideration of “(1) the time and labor required, (2) the
novelty and difficulty of the questions involved, (3) the skill requisite to
perform the legal service properly, (4) the preclusion of other employment
by the attorney due to acceptance of the case, (5) the customary fee,
(6) whether the fee is fixed or contingent, (7) time limitations imposed by
the client or the circumstances, (8) the amount involved and the results
obtained, (9) the experience, reputation, and ability of the attorneys,
(10) the ‘undesirability’ of the case, (11) the nature and length of the pro-

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court must consider a plaintiff ’s request to increase a fee
[based on a contingent-fee agreement],” the Ninth Circuit
stated, “a court ‘is not required to articulate its reasons’ for
accepting or rejecting such a request.” 238 F. 3d, at 1199
(quoting Widrig v. Apfel, 140 F. 3d 1207, 1211 (CA9 1998))
(emphasis in original).
We granted certiorari, 534 U. S. 1039 (2001), in view of the
division among the Circuits on the appropriate method of
calculating fees under § 406(b). Compare Coup v. Heckler,
834 F. 2d 313 (CA3 1987); Craig v. Secretary, Dept. of Health
and Human Servs., 864 F. 2d 324 (CA4 1989); Brown v. Sulli-
van, 917 F. 2d 189 (CA5 1990); Cotter v. Bowen, 879 F. 2d 359
(CA8 1989); Hubbard v. Shalala, 12 F. 3d 946 (CA10 1993);
and Kay v. Apfel, 176 F. 3d 1322 (CA11 1999) (all following,
in accord with the Ninth Circuit, a lodestar method), with
Wells v. Sullivan, 907 F. 2d 367 (CA2 1990); Rodriguez v.
Bowen, 865 F. 2d 739 (CA6 1989) (en banc); and McGuire
v. Sullivan, 873 F. 2d 974 (CA7 1989) (all giving effect to
attorney-client contingent-fee agreement, if resulting fee is
reasonable).9 We now reverse the Ninth Circuit’s judgment.
II
Beginning with the text, § 406(b)’s words, “a reasonable
fee . . . not in excess of 25 percent of . . . the past-due bene-
fits,” read in isolation, could be construed to allow either
the Ninth Circuit’s lodestar approach or petitioners’ position
that the attorney-client fee agreement ordinarily should
control, if not “in excess of 25 percent.” The provision
fessional relationship with the client, and (12) awards in similar cases.”
526 F. 2d, at 69–70 (citing Johnson v. Georgia Highway Express, Inc., 488
F. 2d 714, 717–719 (CA5 1974)).
9 Cf. Ramos Colon v. Secretary of Health and Human Servs., 850 F. 2d
24, 26 (CA1 1988) (per curiam) (“a court is not required to give blind
deference to . . . a contractual fee agreement, and must ultimately be
responsible for fixing a reasonable fee for the judicial phase of the proceed-
ings” (internal quotation marks omitted)).

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instructs “a reasonable fee,” which could be measured by a
lodestar calculation. But § 406(b)’s language does not ex-
clude contingent-fee contracts that produce fees no higher
than the 25 percent ceiling. Such contracts are the most
common fee arrangement between attorneys and Social Se-
curity claimants. See Department of Health and Human
Services, Social Security Administration, Office of Hearings
and Appeals, Report to Congress: Attorney Fees Under
Title II of the Social Security Act 15, 66, 70 (July 1988) (here-
inafter SSA Report); Brief for National Organization of So-
cial Security Claimants’ Representatives as Amicus Curiae
1–2. Looking outside the statute’s inconclusive text, we
next take into account, as interpretive guides, the origin and
standard application of the proffered approaches.
The lodestar method has its roots in accounting practices
adopted in the 1940’s to allow attorneys and firms to deter-
mine whether fees charged were sufficient to cover overhead
and generate suitable profits. W. Ross, The Honest Hour:
The Ethics of Time-Based Billing by Attorneys 16 (1996)
(hereinafter Honest Hour). An American Bar Association
(ABA) report, published in 1958, observed that attorneys’
earnings had failed to keep pace with the rate of inflation;
the report urged attorneys to record the hours spent on each
case in order to ensure that fees ultimately charged afforded
reasonable compensation for counsels’ efforts. See Special
Committee on Economics of Law Practice, The 1958 Lawyer
and His 1938 Dollar 9–10 (reprint 1959).
Hourly records initially provided only an internal account-
ing check. See Honest Hour 19. The fees actually charged
might be determined under any number of methods: the
annual retainer; the fee-for-service method; the “eyeball”
method, under which the attorney estimated an annual fee
for regular clients; or the contingent-fee method, recognized
by this Court in Stanton v. Embrey, 93 U. S. 548, 556 (1877),
and formally approved by the ABA in 1908. See Honest
Hour 13–19. As it became standard accounting practice to

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801 Cite as: 535 U. S. 789 (2002)
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record hours spent on a client’s matter, attorneys increas-
ingly realized that billing by hours devoted to a case was
administratively convenient; moreover, as an objective meas-
ure of a lawyer’s labor, hourly billing was readily impartable
to the client. Id., at 18. By the early 1970’s, the practice
of hourly billing had become widespread. See id., at 19, 21.
The federal courts did not swiftly settle on hourly rates as
the overriding criterion for attorney’s fee awards. In 1974,
for example, the Fifth Circuit issued an influential opinion
holding that, in setting fees under Title VII of the Civil
Rights Act of 1964, 42 U. S. C. § 2000e–5(k) (1970 ed.), courts
should consider not only the number of hours devoted to a
case but also 11 other factors. Johnson v. Georgia Highway
Express, Inc., 488 F. 2d 714, 717–719 (1974).10 The lodestar
method did not gain a firm foothold until the mid-1970’s, see
Lindy Bros. Builders, Inc. of Philadelphia v. American Ra-
diator & Standard Sanitary Corp., 487 F. 2d 161 (CA3 1973),
appeal after remand, 540 F. 2d 102 (1976), and achieved domi-
nance in the federal courts only after this Court’s decisions
in Hensley v. Eckerhart, 461 U. S. 424 (1983), Blum v. Sten-
son, 465 U. S. 886 (1984), and Pennsylvania v. Delaware Val-
ley Citizens’ Council for Clean Air, 478 U. S. 546 (1986).
Since that time, “[t]he ‘lodestar’ figure has, as its name
suggests, become the guiding light of our fee-shifting juris-
prudence.” Burlington v. Dague, 505 U. S. 557, 562 (1992)
(relying on Hensley, Blum, and Delaware Valley to apply
lodestar method to fee determination under Solid Waste Dis-
posal Act, § 7002(e), 42 U. S. C. § 6972(e) (1988 ed.), and Clean
Water Act, § 505(d), 33 U. S. C. § 1365(d) (1988 ed.), and noting
prior application of lodestar method to Civil Rights Attor-
ney’s Fees Awards Act of 1976, 42 U. S. C. § 1988 (1988 ed.,
Supp. III); Title VII of Civil Rights Act of 1964, 42 U. S. C.
§ 2000e–5(k) (1988 ed., Supp. III); and Clean Air Act, 42
U. S. C. § 7604(d) (1988 ed.)). As we recognized in Hensley,
10 See supra, at 798–799, n. 8.

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“[i]deally, . . . litigants will settle the amount of a fee.” 461
U. S., at 437.11 But where settlement between the parties
is not possible, “[t]he most useful starting point for [court
determination of] the amount of a reasonable fee [payable by
the loser] is the number of hours reasonably expended on
the litigation multiplied by a reasonable hourly rate.” Id.,
at 433. Thus, the lodestar method today holds sway in
federal-court adjudication of disputes over the amount of
fees properly shifted to the loser in the litigation. See id.,
at 440 (Burger, C. J., concurring) (decision addresses statute
under which “a lawyer seeks to have his adversary pay the
fees of the prevailing party”).
Fees shifted to the losing party, however, are not at issue
here. Unlike 42 U. S. C. § 1988 (1994 ed. and Supp. V) and
EAJA, 42 U. S. C. § 406(b) (1994 ed., Supp. V) does not au-
thorize the prevailing party to recover fees from the losing
party. Section 406(b) is of another genre: It authorizes fees
payable from the successful party’s recovery. Several stat-
utes governing suits against the United States similarly pro-
vide that fees may be paid from the plaintiff ’s recovery.
See, e. g., Federal Tort Claims Act (FTCA), 28 U. S. C. § 2678
(“No attorney shall charge, demand, receive, or collect for
services rendered, fees in excess of 25 per centum of any
[court] judgment rendered [in an FTCA suit], or in excess of
20 per centum of any award, compromise, or settlement made
[by a federal agency to settle an FTCA claim].”); Veterans’
Benefits Act, 38 U. S. C. § 5904(d)(1) (1994 ed.) (“When
a claimant [for veterans’ benefits] and an attorney have
entered into a [contingent-]fee agreement [under which fees
are paid by withholding from the claimant’s benefits award],
the total fee payable to the attorney may not exceed 20 per-
cent of the total amount of any past-due benefits awarded
11 See also, e. g., 31 U. S. C. § 3554(c)(4) (1994 ed.) (“[T]he Federal agency
and the interested party shall attempt to reach an agreement on the
amount of the costs [including attorneys’ fees] to be paid.”).

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on the basis of the claim.”).12 Characteristically in cases
of the kind we confront, attorneys and clients enter into
contingent-fee agreements “specifying that the fee will be 25
percent of any past-due benefits to which the claimant be-
comes entitled.” Brief for National Organization of Social
Security Claimants’ Representatives as Amicus Curiae 2;
see Brief for Washington Legal Foundation et al. as Amici
Curiae 9, n. 6 (“There is no serious dispute among the par-
ties that virtually every attorney representing Title II dis-
ability claimants includes in his/her retainer agreement a
provision calling for a fee equal to 25% of the past-due bene-
fits awarded by the courts.”).
Contingent fees, though problematic, particularly when
not exposed to court review, are common in the United
States in many settings. Such fees, perhaps most visible in
12 See also Servicemembers’ Group Life Insurance Act, 38 U. S. C.
§ 1984(g) (1994 ed.) (“[T]he court . . . shall determine and allow reasonable
fees for the attorneys of the successful party or parties and apportion
same if proper, said fees not to exceed 10 per centum of the amount recov-
ered and to be paid by the Department out of the payments to be made
under the judgment or decree.”); International Claims Settlement Act of
1949 (ICSA), 22 U. S. C. § 1623(f) (“No remuneration on account of services
rendered on behalf of any claimant in connection with any claim filed with
the Commission under [the ICSA] shall exceed 10 per centum of the total
amount paid pursuant to any award certified under the [ICSA] on account
of such claim. Any agreement to the contrary shall be unlawful and
void.”); Trading with the Enemy Act, 50 U. S. C. App. § 20 (1994 ed.) (“No
property or interest or proceeds shall be returned under this Act . . .
unless satisfactory evidence is furnished . . . that the aggregate of the fees
to be paid to all agents, attorneys . . . , or representatives, for services
rendered in connection with such return or payment or judgment does not
exceed 10 per centum of the value of such property or interest or proceeds
or of such payment.”); War Claims Act, 50 U. S. C. App. § 2017m (“No
remuneration on account of services rendered on behalf of any claimant
in connection with any claim filed with the Commission under this [Act]
shall exceed 10 per centum (or such lesser per centum as may be fixed by
the Commission with respect to any class of claims) of the total amount
paid pursuant to any award certified under the provisions of this title . . .
on account of such claim.”).

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804 GISBRECHT v. BARNHART
Opinion of the Court
tort litigation, are also used in, e. g., patent litigation, real
estate tax appeals, mergers and acquisitions, and public of-
ferings. See ABA Formal Opinion 94–389, ABA/BNA Law-
yers’ Manual On Professional Conduct 1001:248, 1001:250
(1994). But see id., at 1001:248, n. 3 (quoting observation
that controls on contingent fees are needed to “reduce finan-
cial incentives that encourage lawyers to file unnecessary,
unwarranted[,] and unmeritorious suits” (internal quotation
marks omitted)). Traditionally and today, “the marketplace
for Social Security representation operates largely on a con-
tingency fee basis.” SSA Report 3; see also id., at 15, 66,
70; App. to Pet. for Cert. 56, 60, 88, 89, 91 (affidavits of
practitioners).
Before 1965, the Social Security Act imposed no limits on
contingent-fee agreements drawn by counsel and signed by
benefits claimants. In formulating the 1965 Social Security
Act amendments that included § 406(b), Congress recognized
that “attorneys have upon occasion charged . . . inordinately
large fees for representing claimants [in court].” S. Rep.
No. 404, 89th Cong., 1st Sess., pt. 1, p. 122 (1965). Arrange-
ments yielding exorbitant fees, the Senate Report observed,
reserved for the lawyer one-third to one-half of the accrued
benefits. Ibid. Congress was mindful, too, that the longer
the litigation persisted, the greater the buildup of past-due
benefits and, correspondingly, of legal fees awardable from
those benefits if the claimant prevailed. Ibid.13
Attending to these realities, Congress provided for
“a reasonable fee, not in excess of 25 percent of accrued bene-
13 Congress also adopted a proposal recommended by the Social Security
Administration that attorneys be paid directly with funds withheld from
their clients’ benefits awards; the Commissioner testified to the Senate
Committee on Finance that “[a]ttorneys have complained that . . . awards
are sometimes made to the claimant without the attorney’s knowledge and
that some claimants on occasion have not notified the attorney of the re-
ceipt of the money, nor have they paid his fee.” Hearings on H. R. 6675
before the Senate Committee on Finance, 89th Cong., 1st Sess., pt. 1,
pp. 512–513 (1965).

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fits,” as part of the court’s judgment, and further specified
that “no other fee would be payable.” Ibid. Violation of
the “reasonable fee” or “25 percent of accrued benefits” limi-
tation was made subject to the same penalties as those appli-
cable for charging a fee larger than the amount approved by
the Commissioner for services at the administrative level—
a fine of up to $500, one year’s imprisonment, or both. Ibid.
“[T]o assure the payment of the fee allowed by the court,”
Congress authorized the agency “to certify the amount of
the fee to the attorney out of the amount of the accrued
benefits.” Ibid.; see supra, at 804, n. 13.
Congress thus sought to protect claimants against “inordi-
nately large fees” and also to ensure that attorneys repre-
senting successful claimants would not risk “nonpayment of
[appropriate] fees.” SSA Report 66 (internal quotation
marks omitted). But nothing in the text or history of
§ 406(b) reveals a “desig[n] to prohibit or discourage attor-
neys and claimants from entering into contingent fee agree-
ments.” Ibid. Given the prevalence of contingent-fee
agreements between attorneys and Social Security claim-
ants, it is unlikely that Congress, simply by prescribing “rea-
sonable fees,” meant to outlaw, rather than to contain, such
agreements.14
This conclusion is bolstered by Congress’ 1990 authoriza-
tion of contingent-fee agreements under § 406(a), the provi-
sion governing fees for agency-level representation. Before
enacting this express authorization, Congress instructed the
Social Security Administration to prepare a report on attor-
14 Cf., e. g., Act of Mar. 3, 1891, § 9, 26 Stat. 851–854 (regulating fees for
claims by Native Americans before the Court of Claims and providing:
“all contracts heretofore made for fees and allowances to claimants’ attor-
neys, are hereby declared void . . . and the allowances to the claimant’s
attorneys shall be regulated and fixed by the court”); Alaska Native
Claims Settlement Act of 1971, 43 U. S. C. § 1621(a) (1994 ed.) (“None of
the revenues granted by [the Act] shall be subject to any contract which
is based on a percentage fee of the value of all or some portion of the
settlement granted by this [Act].”).

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806 GISBRECHT v. BARNHART
Opinion of the Court
ney’s fees under Title II of the Social Security Act. Pub. L.
100–203, § 9021(b), 101 Stat. 1330–295. The report, pre-
sented to Congress in 1988, reviewed several methods of de-
termining attorney’s fees, including the lodestar method.
See SSA Report 10–11. This review led the agency to in-
form Congress that, although the contingency method was
hardly flawless, the agency could “identify no more effective
means of ensuring claimant access to attorney representa-
tion.” Id., at 25.
Congress subsequently altered § 406(a) to validate
contingent-fee agreements filed with the agency prior to dis-
position of the claim for benefits. See 42 U. S. C. § 406(a)(2)
(1994 ed.); supra, at 795. As petitioners observe, Brief for
Petitioners 24, it would be anomalous if contract-based fees
expressly authorized by § 406(a)(2) at the administrative
level were disallowed for court representation under § 406(b).
It is also unlikely that Congress, legislating in 1965, and
providing for a contingent fee tied to a 25 percent of past-due
benefits boundary, intended to install a lodestar method
courts did not develop until some years later. See supra,
at 801–802. Furthermore, we again emphasize, the lodestar
method was designed to govern imposition of fees on the
losing party. See, e. g., Dague, 505 U. S., at 562. In such
cases, nothing prevents the attorney for the prevailing party
from gaining additional fees, pursuant to contract, from his
own client. See Venegas v. Mitchell, 495 U. S. 82, 89–90
(1990) (“[None] of our cases has indicated that [42 U. S. C.]
§ 1988 . . . protects plaintiffs from having to pay what they
have contracted to pay, even though their contractual liabil-
ity is greater than the statutory award that they may collect
from losing opponents. Indeed, depriving plaintiffs of the
option of promising to pay more than the statutory fee if that
is necessary to secure counsel of their choice would not fur-
ther § 1988’s general purpose of enabling such plaintiffs . . .
to secure competent counsel.”). By contrast, § 406(b) gov-
erns the total fee a claimant’s attorney may receive for court
representation; any endeavor by the claimant’s attorney to

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807 Cite as: 535 U. S. 789 (2002)
Opinion of the Court
gain more than that fee, or to charge the claimant a noncon-
tingent fee, is a criminal offense. 42 U. S. C. § 406(b)(2); 20
CFR § 404.1740(c)(2) (2001).
Most plausibly read, we conclude, § 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. Rather, § 406(b) calls for court
review of such arrangements as an independent check, to as-
sure that they yield reasonable results in particular cases.15
Congress has provided one boundary line: Agreements are
unenforceable to the extent that they provide for fees ex-
ceeding 25 percent of the past-due benefits. § 406(b)(1)(A)
(1994 ed., Supp. V).16 Within the 25 percent boundary,
as petitioners in this case acknowledge, the attorney for
the successful claimant must show that the fee sought is
reasonable for the services rendered. See Brief for Peti-
tioners 40.17
15 The dissent observes that “fee agreements in . . . Social-Security cases
are hardly negotiated; they are akin to adherence contracts.” Post, at
812. Exposure to court review, plus the statute’s 25 percent limitation,
however, provide checks absent from arbitration adherence provisions this
Court has upheld over objections that they are not “freely negotiated,”
see Vimar Seguros y Reaseguros, S. A. v. M/V Sky Reefer, 515 U. S. 528,
556 (1995) (Stevens, J., dissenting), but are the product of “disparate bar-
gaining power” between the contracting parties, Carnival Cruise Lines,
Inc. v. Shute, 499 U. S. 585, 598 (1991) (Stevens, J., dissenting). See also
Circuit City Stores, Inc. v. Adams, 532 U. S. 105, 138–139, and n. 3 (2001)
(Souter, J., dissenting) (observing that many employees “lack the bar-
gaining power to resist an arbitration clause if their prospective employers
insist on one”).
16 Statement of the limitation in terms of a percent of the recovery tell-
ingly contrasts with EAJA, which authorizes fee shifting and, correspond-
ingly, places a specific dollar limit on the hourly rate that ordinarily can
be charged to the losing party. 28 U. S. C. § 2412(d)(2)(A); see supra, at
796, and n. 4.
17 Specifically, petitioners maintain that “[a]lthough section 406(b) per-
mits an attorney to base a fee application on a contingent fee agreement
with the claimant, the statute does not create any presumption in favor of
the agreed upon amount. To the contrary, because section 406(b) requires
an affirmative judicial finding that the fee allowed is ‘reasonable,’ the

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808 GISBRECHT v. BARNHART
Opinion of the Court
Courts that approach fee determinations by looking first
to the contingent-fee agreement, then testing it for reason-
ableness, have appropriately reduced the attorney’s recovery
based on the character of the representation and the results
the representative achieved. See, e. g., McGuire, 873 F. 2d,
at 983 (“Although the contingency agreement should be
given significant weight in fixing a fee, a district judge must
independently assess the reasonableness of its terms.”);
Lewis v. Secretary of Health and Human Servs., 707 F. 2d
246, 249–250 (CA6 1983) (instructing reduced fee when rep-
resentation is substandard). If the attorney is responsible
for delay, for example, a reduction is in order so that the
attorney will not profit from the accumulation of benefits
during the pendency of the case in court. See Rodriquez,
865 F. 2d, at 746–747. If the benefits are large in comparison
to the amount of time counsel spent on the case, a downward
adjustment is similarly in order. See id., at 747 (reviewing
court should disallow “windfalls for lawyers”); Wells, 907
F. 2d, at 372 (same). In this regard, the court may require
the claimant’s attorney to submit, not as a basis for satel-
lite litigation, but as an aid to the court’s assessment of the
reasonableness of the fee yielded by the fee agreement, a
record of the hours spent representing the claimant and a
statement of the lawyer’s normal hourly billing charge for
noncontingent-fee cases. See Rodriquez, 865 F. 2d, at 741.
Judges of our district courts are accustomed to making rea-
sonableness 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.
* * *
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 agree-
attorney bears the burden of persuasion that the statutory requirement
has been satisfied.” Brief for Petitioners 40.

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Scalia, J., dissenting
ments within the statutory ceiling; 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.
It is so ordered.
Justice Scalia, dissenting.
I do not know what the judges of our district courts and
courts of appeals are to make of today’s opinion. I have
no idea what the trial judge is to do if he finds the fee pro-
duced by the (“presumptively reasonable,” ante, at 792)
contingent-fee agreement to be 25% above the lodestar
amount; or 40%; or 65%. Or what the appellate court is to
do in an appeal from a district judge’s reduction of the con-
tingent fee to 300% of the lodestar amount; or 200%; or to
the lodestar amount itself. While today’s opinion gets this
case out of our “in” box, it does nothing whatever to subject
these fees to anything approximating a uniform rule of law.
That is, I think, the inevitable consequence of trying to com-
bine the incompatible. The Court tells the judge to com-
mence his analysis with the contingent-fee agreement, but
then to adjust the figure that agreement produces on the
basis of factors (most notably, the actual time spent multi-
plied by a reasonable hourly rate, ante, at 808) that are, in a
sense, the precise antithesis of the contingent-fee agreement,
since it was the very purpose of that agreement to eliminate
them from the fee calculation. In my view, the only possible
way to give uniform meaning to the statute’s “reasonable
fee” provision is to understand it as referring to the fair
value of the work actually performed, which we have held is
best reflected by the lodestar.1 See Hensley v. Eckerhart,
461 U. S. 424, 433 (1983).
1 The Court finds it “unlikely,” ante, at 806, that 42 U. S. C. § 406(b) (1994
ed.), enacted in 1965, contemplated application of the lodestar method that
the courts had not yet even developed. Of course it did not. But it did

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Scalia, J., dissenting
I think it obvious that the reasonableness of a contingent-
fee arrangement has to be determined by viewing the matter
ex ante, before the outcome of the lawsuit and the hours of
work expended on the outcome are definitively known. For
it is in the nature of a contingent-fee agreement to gamble
on outcome and hours of work—assigning the risk of an un-
successful outcome to the attorney, in exchange for a per-
centage of the recovery from a successful outcome that will
(because of the risk of loss the attorney has borne) be higher,
and perhaps much higher, than what the attorney would re-
ceive in hourly billing for the same case. That is why, in
days when obtaining justice in the law courts was thought
to be less of a sporting enterprise, contingent fees were un-
lawful. See, e. g., Butler v. Legro, 62 N. H. 350, 352 (1882)
(“Agreements of this kind are contrary to public justice and
professional duty, tend to extortion and fraud, and are cham-
pertous and void”).
It is one thing to say that a contingent-fee arrangement is,
ex ante, unreasonable because it gives the attorney a per-
centage of the recovery so high that no self-respecting legal
system can tolerate it; the statute itself has made this de-
termination for Social-Security-benefit cases, prescribing a
maximum contingent fee of 25%. And one can also say that
a contingent-fee arrangement is, ex ante, unreasonable be-
cause the chances of success in the particular case are so
high, and the anticipated legal work so negligible, that the
percentage of the recovery assured to the lawyer is exorbi-
tant; but neither I nor the Court thinks that the “reasonable
contemplate an ex post determination of a reasonable fee for an attorney’s
work—which our post-1965 cases have held is best achieved by using the
lodestar. We have not hesitated to apply the lodestar method to other
fee statutes enacted before the method was developed. See, e. g., Bur-
lington v. Dague, 505 U. S. 557, 561–562 (1992) (explaining that “our case
law construing what is a ‘reasonable’ fee applies uniformly” to fee-shifting
statutes that use similar language, including, inter alia, 42 U. S. C. § 1988
and 42 U. S. C. § 2000e–5(k) (Civil Rights Act of 1964)).

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Scalia, J., dissenting
fee” provision of the statute anticipates such a case-by-case
ex post assessment of ex ante predictions in the thousands of
(mostly small recovery) Social-Security-benefit cases. It is
something quite different, however—and something quite
irrational—to look at the consequences of a contingent-fee
agreement after the contingencies have been resolved, and
proclaim those consequences unreasonable because the attor-
ney has received too much money for too little work. That
is rather like declaring the purchase of the winning lottery
ticket void because of the gross disparity between the $2
ticket price and the million-dollar payout.2
I think, in other words, that the “reasonable fee” provision
must require either an assessment of the reasonableness of
the contingent-fee agreement when it was concluded, or an
assessment of the reasonableness of the fee charged after
the outcome and work committed to it are known; it cannot
combine the two. And since an ex post assessment of the
ex ante reasonableness of the contingent-fee agreement
(already limited by statute to a maximum 25% of the re-
covery) is not what the statute could conceivably have con-
templated, I conclude that a “reasonable fee” means not the
reasonableness of the agreed-upon contingent fee, but a rea-
sonable recompense for the work actually done. We have
held that this is best calculated by applying the lodestar,
2 There is one ex post element prominent in Social-Security-benefit cases
that assuredly should reduce the amount of an otherwise reasonable (that
is to say, an ex ante reasonable) contingent-fee award: Since the award
is based upon past-due benefits, and since the amount of those benefits
increases with the duration of the litigation, a lawyer can increase
his contingent-fee award by dragging his feet. It is unreasonable to be
rewarded for dilatoriness. But that element need not be made part of
an overall ex post reasonableness assessment, as the Court would do,
see ante, at 808. For it is not only unreasonable; it is a breach of contract.
Surely the representation agreement contains as an implicit term that the
lawyer will bring the matter to a conclusion as quickly as practicable—or
at least will not intentionally delay its conclusion. Any breach of that
condition justifies a reduction of the contracted contingent-fee award.

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812 GISBRECHT v. BARNHART
Scalia, J., dissenting
which focuses on the quality and amount of the legal work
performed, and “provides an objective basis on which to . . .
estimate . . . the value of a lawyer’s services.” Hensley, 461
U. S., at 433.
This is less of a departure than the Court suggests from
the normal practice of enforcing privately negotiated fee
agreements. The fee agreements in these Social-Security
cases are hardly negotiated; they are akin to adherence con-
tracts. It is uncontested that the specialized Social-Security
bar charges uniform contingent fees (the statutory maximum
of 25%), which are presumably presented to the typically un-
sophisticated client on a take-it-or-leave-it basis. Nor does
the statute’s explicit approval of contingency-fee agreements
at the agency stage, see 42 U. S. C. § 406(a) (1994 ed. and
Supp. V), imply that contingency-fee agreements at the
judicial-review stage should be regarded as presumptively
reasonable. The agreements approved at the agency stage
are limited not merely by a 25% maximum percentage of
recovery, but also by a firm $5,300 maximum. With the lat-
ter limitation, there is no need to impose a reasonableness
requirement. Once a reasonableness requirement is im-
posed, however, I think it can only refer to the reasonable-
ness of the actual compensation.
* * *
Because I think there is no middle course between, on the
one hand, determining the reasonableness of a contingent-fee
agreement and, on the other hand, determining the reason-
ableness of the actual fee; because I think the statute’s ref-
erence to a “reasonable fee” must connote the latter; and
because I think the Court’s hybrid approach establishes
no clear criteria and hence will generate needless satellite
litigation; I respectfully dissent.