Richard Culbertson v. Nancy Berryhill

§ 406(B)’S TEXT AND STRUCTURE

Richard Culbertson argues that the plain text of § 406(b) and the structure of § 406 confirm that the 25 percent cap on attorney’s fees applies only to fees incurred in representation before the court. Culbertson notes that the language of § 406(b) has a clear meaning, which controls interpretation of the statute. Culbertson asserts that § 406(b)’s cap on attorney’s fees for “such representation” must refer to representation before a court because court representation is the only kind of representation mentioned in that section. Culbertson also points out that Congress would have mirrored the language in in § 406(a), which specifies representation “before the Commissioner for benefits” and “fees . . . in the aggregate,” if Congress intended § 406(b) to cap the total attorney’s fees.

Furthermore, according to Culbertson, the separate regulation mechanisms under § 406(a) and § 406(b) confirm that § 406(b)’s 25-percent cap does not apply to § 406(a). Culbertson notes that § 406(a), which governs attorney’s fees for representation before agencies, already imposes a “reasonableness” test. Therefore, Culbertson argues, there is no need for § 406(b) to regulate attorney’s fees that fall under § 406(a). Culbertson maintains that § 406(a) allows attorney’s fees above 25 percent of benefits, so applying § 406(b)’s 25-percent cap to agency representation conflicts with § 406(a). Moreover, Culbertson emphasizes that the SSA’s Program Operations Manual System (“POMS”), which guides Social Security administrators, anticipates situations where attorney’s total fees for § 406(a) and (b) representation exceeds 25 percent.

Nancy Berryhill on behalf of the United States also argues that § 406(b)’s 25-percent cap should apply only to attorney’s fees for court proceedings. Berryhill notes that the 25-percent cap cannot apply to aggregated fees because POMS authorizes the SSA to pay out attorney’s fees greater than 25-percent for agency representation alone. Furthermore, according to Berryhill, the determinative cases in the Eleventh Circuit’s decision, Dawson v. Finch and Morris v. Social Security Administration, incorrectly interpreted § 406(b). Berryhill asserts that the court in Dawson did not analyze the text of § 406(b) and relied on congressional testimony that actually limits § 406(b) to court representation. Berryhill challenges the interpretation of § 406(a) in Morris, which held that the statute prohibits attorneys from receiving fees greater than 25 percent. .

In contrast, Amy Weil, the court-appointed amicus curiae arguing in support of the Eleventh Circuit’s decision, argues that combined attorney’s fees under § 406(a) and § 406(b) may not exceed 25 percent of a claimant’s benefits. . Weil begins by noting that the statute does not specify whether the 25-percent cap applies to aggregated fees. . Thus, Weil stresses that legislative history and Congressional intent are persuasive. Weil contends that the Supreme Court’s past rulings support a holistic reading of the § 406’s language. . Weil asserts that because the Social Security Act’s purpose is to provide a remedy for claimants, the language of the statute should be read to favor claimants.

In response to Culbertson’s structural argument, Weil admits that both § 406(a) and § 406(b) provide different ways of regulating attorney’s fees. Yet, Weil contends that Culbertson’s interpretation of § 406 would lead to absurd results. According to Weil, if the sum of attorney’s fees can exceed 25 percent of benefits, the agency lawyer and the court lawyer would be racing against each other to receive their respective fees. Weil asserts that Congress would not have intended to create such a race between lawyers. Weil also argues that Culbertson’s interpretation of § 406(b) allows the sum of attorney fees up to 75 percent of a claimant’s benefits. Weil maintains that, under § 406(b), a court can allow an attorney’s fee up to 25 percent of the claimant’s benefits whenever a court rules in favor of a claimant. According to Weil, § 406(b) does not define the word “court”; therefore, under Culbertson’s “plain language” approach, court attorneys for the district court and the appellate court can charge up to 50 percent, in addition to the 25 percent of benefits for agency representation.

Weil maintains that the POMS is merely a guide, which does not provide a legal opinion on whether the 25-percent cap applies to combined § 406(a) and (b) fees. Furthermore, Weil notes that Berryhill agreed with Dawson and perpetuated the 25-percent aggregate rule for 35 years. Weil argues that the Commissioner acts contrary to the interests of the claimants because her new interpretation of § 406(b) may reduce the benefits claimants retain.

§ 406(B)’S LEGISLATIVE HISTORY AND CONGRESS’S INTENT

Culbertson contends that Congress enacted § 406(b) to limit excessive attorney’s fees incurred in court proceedings. Culbertson asserts that limiting the 25-percent cap on in-court representation fees would still protect the majority of claimant’s benefits. Culbertson argues that future benefits comprise the majority of a claimant’s total award and would be wholly retained by complainants under his interpretation.

Berryhill argues that SSA and reviewing courts’ “discretion to prevent unduly large fees” sufficiently protects claimants from overbilling by attorneys. Berryhill explains that the SSA requires attorneys to disclose all of the fees that the attorneys are charging for the matter and that the SSA approves only “reasonable fee[s]”. Furthermore, Berryhill states that the claimant can request that the SSA reduce the fee. Berryhill maintains that, even without a 25-percent cap on the aggregate fees, Congress granted reviewing courts discretion to determine reasonable fee amounts based on the “overall fee burden on the claimant.”

Weil counters that although § 406 is silent on the scope of § 406(b)’s 25-percent gap, the legislative history of § 406 shows that § 406 limits both court and agency attorney’s fees to a total of 25 percent of benefits. According to Weil, Congress amended § 406 in 1965, capping court fees at 25 percent, to protect Social Security claimants from attorney’s fees that had been cutting their benefits by up to half. Thus, Weil continues, Congress could not have intended the subsequent 1968 amendment to allow an attorney’s fee of up to 50 percent of a claimant’s benefits. Weil suggests that existing safeguards are insufficient to prevent excessive attorney’s fees, citing fee awards of near 50 percent of past-due benefits in circuits rejecting the 25-percent aggregate rule. Weil emphasizes that § 406(b) must cap aggregated fees to fulfill Congress’s intent to prevent lawyers from taking advantage of Social Security claimants. Lastly, Weil adds that a broad interpretation of the attorney’s fees provisions would further the claimant-protection purpose of the Social Security Act.