Greenberg v. Colvin, 63 F. Supp. 3d 37

Background

Plaintiff Greenberg sued SSA alleging WEP was improperly applied to reduce OASDI benefits for beneficiaries who also receive Israeli National Insurance Institute (NII) Old Age pensions; SSA had previously conceded the Berger remand showing WEP was wrongly applied to at least one beneficiary.
Parties reached a provisional settlement agreeing SSA would stop applying WEP to NII Old Age benefits, recalculate affected benefits since September 3, 2004, and pay past-due amounts; they jointly sought class certification to effectuate the settlement.
Proposed class: all beneficiaries whose OASDI payments were reduced since Sept. 3, 2004 by WEP because of receipt of NII Old Age benefits (estimated up to ~1,666 persons).
The motion for class certification under Fed. R. Civ. P. 23(b)(3) was unopposed; the court analyzed numerosity, commonality, typicality, adequacy, predominance, superiority, notice, and appointed Kelley Drye as class counsel.
The parties disputed the proper statutory basis for attorneys’ fees: Plaintiff sought fees under 42 U.S.C. § 406(b) (or alternatives), while Defendants argued EAJA (28 U.S.C. § 2412(d)) was the appropriate source; the court resolved entitlement to seek § 406(b) fees now to permit settlement notice planning.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Class certification under Rule 23(b)(3)	Class meets numerosity, commonality, typicality, adequacy; common legal issue (WEP application) predominates; class action is superior	Unopposed	Court certified the settlement-only class under Rule 23(b)(3) and appointed class counsel
Whether § 406(b) permits fee awards in Social Security class actions	§ 406(b) authorizes courts to award reasonable fees (≤25% of past-due benefits) to counsel for a claimant — language and context allow application to multiple claimants/class actions	Defendants contended § 406(b) refers to an individual claimant and should not apply to class actions	Court held § 406(b) can authorize fee awards in class actions; a class counsel may seek fees up to 25% of each beneficiary’s past-due benefits
Whether individual contingent fee agreements are required from each class member before seeking § 406(b) fees	Not required; § 406(b) does not mandate signed individual contingency agreements and class counsel represents absent members after certification; notice and chance to object suffice	Argued absent class members did not sign contingency agreements and thus counsel cannot seek § 406(b) fees from their recoveries	Court held individual signed agreements are not required; class counsel may seek § 406(b) fees if notice and opportunity to opt out/object are provided; court will review reasonableness later
Whether EAJA is the exclusive or preferable fee source instead of § 406(b)	§ 406(b) is proper; EAJA remains available and any EAJA award offsets § 406(b) recovery (claimant is refunded the smaller fee)	Defendants urged EAJA as appropriate authority and/or that § 406(b) would create conflicts or be inappropriate here	Court held § 406(b) awards are appropriate and compatible with EAJA (consistent with Gisbrecht); any EAJA award would offset § 406(b) so claimant is not disadvantaged

Key Cases Cited

Gisbrecht v. Barnhart, 535 U.S. 789 (2002) (§ 406(b) and EAJA interaction; contingency agreements reviewed for reasonableness)
Califano v. Yamasaki, 442 U.S. 682 (1979) (permitting class actions in Social Security context despite statutory text addressing an individual)
Amchem Prods., Inc. v. Windsor, 521 U.S. 591 (1997) (standards for certifying settlement-only classes under Rule 23)
Hopkins v. Cohen, 390 U.S. 530 (1968) (rejecting overly technical construction of § 406(b) and allowing fees from family benefits)
McGraw v. Barnhart, 450 F.3d 493 (10th Cir. 2006) (interpreting § 406(b)’s purpose to encourage representation and permitting broader reading)
Buljina v. Astrue, 828 F. Supp. 2d 109 (D.D.C. 2011) (discussing § 406(b) practice in this district and awarding fees from claimant recovery)