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These are the footnotes for the case of GARY E. GISBRECHT, BARBARA A. MILLER, NANCY SANDINE, and DONALD L. ANDERSON, PETITION- ERS v. JO ANNE B. BARNHART, COMMISSIONER OF SOCIAL SECURITY ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE NINTH CIRCUIT [May 28, 2002]
1. 49 Stat. 624, as amended.
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) implicitly 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 As to administrative proceedings, the Social Security Act originally made no provision for attorney’s fees. 49 Stat. 620 (1935).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 proceedings to be slim. H. R. Rep. No. 728, 76th Cong., 1st Sess., pp. 44—45 (1939); S. Rep. No. 734, 76th Cong., 1st Sess., p. 53 (1939). The Board subsequently established a maximum fee of $10, permitting a higher fee only by petition 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. 20 CFR § 404.1725(b) (2001) 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, together 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 services, including any amount authorized or requested before, but not including the amount of any expenses he or she incurred. “(2) Although we consider the amount of benefits, if any, that are payable, 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 of law and are unrelated to the efforts of the representative. We may authorize a fee even if no benefits are payable.”
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).
5. Section 405(g) authorizes judicial review of administrative denials of applications for Social Security benefits.
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 professional relationship with the client, and (12) awards in similar cases.” Kerr v. Screen Extras Guild, 526 F.2d 67, 69—70 (CA9 1975) (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 proceedings” (internal quotation marks omitted)).
10. See supra, at 8, n. 8.
11. See also, e.g., 31 U.S.C. § 3554(c)(3)(B)(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.”).
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 recovered 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.”).
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 receipt 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).
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’ attorneys, 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].”).
15. The dissent observes that “fee agreements in … Social Security cases are hardly negotiated; they are akin to adherence contracts.” Post, at 4. 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 bargaining 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 bargaining 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 tellingly contrasts with EAJA, which authorizes fee shifting and, correspondingly, 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 5, and n. 4.
17. Specifically, petitioners maintain that “[a]lthough section 406(b) permits 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 attorney bears the burden of persuasion that the statutory requirement has been satisfied.” Brief for Petitioners 40.
