Offset Required For Attorney Fee Award In Social Security Case


In Parrish v. Commissioner of Social Security Administration, 2012 DJDAR 15223 (2012), the U.S. Court of Appeal for the Ninth Circuit decided a unique attorney fee case arising out of a dispute relating to the claimant’s eligibility for Social Security benefits.

The Social Security Act (SSA) and the Equal Access to Justice Act (EAJA), 42 U.S.C. Section 406(b) and 28 U.S.C. Section 2412, allow for an award of reasonable attorney fees for cases where a claimant successfully challenges the denial of Social Security benefits. However, Congress enacted a savings clause to prevent attorneys from receiving fees twice “for the same work.” The Parrish case required the court to analyze whether the fee claim at issue therein sought double recovery “for the same work.”

An attorney represented a client in an action for past due Social Security benefits. The administrative law judge (ALJ) denied the claimant’s application for benefits. The attorney then pursued an appeal of the benefits denial before the district court. After completion of briefing, the parties agreed to remand the case to the Social Security Administration for reevaluation of the claimant’s contention concerning disability. Also by agreement, the claimant’s attorney was given a stipulated fee award of $5,000 in fees pursuant to the EAJA.

A different attorney represented the claimant before the ALJ on remand. The ALJ again concluded that the claimant was not disabled. The first attorney again represented the claimant on her second appeal to the district court, which ultimately resulted in the claimant’s favor. The attorney received another $6,575 in EAJA fees, for a total of $11,575 in EAJA fees.

After the second remand and award of past due benefits, the attorney then sought $9,060 in fees under the Social Security statute, Section 406(b). Counsel stipulated to a reduction in fees under the savings provision which precludes double compensation “for the same work.” After the offset, the claim for fees was for $2,484.87. The district court awarded the attorney Section 406(b) fees, but also went further in reducing the fees and deducted both the EAJA awards in their entirety.

Counsel then filed an appeal to the Ninth Circuit focusing on the elimination of EAJA fees. The Ninth Circuit affirmed the decision of the lower court. The Ninth Circuit noted that under the savings provision, a lawyer is required to offset the attorney fees award where the attorney receives fees “for the same work” under both Section 406(b) and Section 2412. Moreover, an award under Section 406(b) compensates an attorney for all the work before a federal court on behalf of a claimant in an SSA‑related claim. For these reasons, the Ninth Circuit concluded that the district court properly deducted the EAJA fee award as an offset.


DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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