Unreported / Non-Citable
Background
Plaintiff Yvette Rosado filed this action on September 15, 2020, in the Northern District of California, seeking judicial review of the denial of her application for Social Security disability benefits. On September 8, 2021, the court approved the parties' stipulation to a voluntary remand for further administrative proceedings. After remand, the parties stipulated to an award of $7,700 in attorney's fees to Rosado's counsel under the Equal Access to Justice Act (EAJA), 28 U.S.C. § 2412(d).
On remand, Rosado obtained a fully favorable result and was awarded $75,167.92 in past-due benefits. As is standard, the Social Security Administration withheld 25% of the past-due benefits—$18,791.98—to cover any attorney's fees owed. Pursuant to a written contingent-fee agreement, counsel moved under 42 U.S.C. § 406(b) for the withheld amount, offset by the $7,700 in EAJA fees already awarded, for a net payment of $11,091.98. The Commissioner, Frank Bisignano, neither supported nor opposed the request.
The Court’s Holding
The court first addressed timeliness. The motion was filed three years after the SSA issued the Notice of Award, but counsel explained that the SSA never sent him a copy; after repeated contacts, he received it on September 3, 2026, and filed the motion that same day. The Ninth Circuit has not addressed timeliness for § 406(b) motions. Some circuits apply Rule 54(d)(2)'s 14-day deadline, while the Tenth Circuit applies Rule 60(b)(6)'s 'reasonable time' standard, which courts in this district routinely follow. Absent contrary Ninth Circuit authority, the court applied the reasonable-time standard and held the motion timely.
The court then assessed reasonableness. Under § 406(b), the court may award a reasonable fee not exceeding 25% of past-due benefits, and it must independently check contingent-fee agreements to ensure they yield reasonable results, adjusting downward for substandard representation, delay, or windfall. Here, counsel secured a fully favorable outcome, never sought an extension, and the parties stipulated to remand less than a year after the complaint; the court found no substandard performance or delay. The requested $18,791.98 for 41 hours produced an effective hourly rate of $458.34—well below the $519, $875, $902, $826, and $1,213.83 rates approved in Ninth Circuit and district cases. The court therefore found the 25% award reasonable.
Finally, because fees had been awarded under both the EAJA and § 406(b) for the same work, counsel generally must refund the smaller fee to the claimant. Rather than require a refund of the $7,700 EAJA award, the court granted counsel's request—unopposed by the Commissioner—to effectuate the offset through a net payment, and ordered the SSA to remit $11,091.98 to counsel.
Key Takeaways
- The court granted the § 406(b) motion, awarding counsel $18,791.98, the full 25% of Rosado's $75,167.92 in past-due benefits.
- To effectuate the EAJA offset, the SSA was directed to remit a net payment of $11,091.98 to counsel instead of requiring a refund of the $7,700 to Rosado.
- The court applied the Tenth Circuit's 'reasonable time' standard and found the motion timely because counsel filed it the same day he received the Notice of Award, three years after issuance.
- The 25% contingent fee survived the independent reasonableness check: a fully favorable result, no delay, and a $458.34 effective hourly rate below routinely approved comparators.
- The order confirms that a net fee award from the SSA can satisfy the rule against double compensation under the EAJA and § 406(b).
Why It Matters
The order shows how this district processes § 406(b) fee motions in Social Security cases: it applies the reasonable-time timeliness standard absent Ninth Circuit guidance, and it performs the required independent check of contingent-fee agreements even when the fee equals the 25% statutory maximum.
It also provides practical guidance on coordinating § 406(b) and EAJA awards, approving a net-payment procedure that avoids double compensation while sparing counsel from refunding the smaller EAJA fee to the claimant.