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United States District Court, S.D. Iowa, Central Division.

BILLY JO A. MCDONALD, Plaintiff, v. KILOLO KIJAKAZI, Acting Commissioner of the Social Security Administration, Defendant.

Case No. 4:18-cv-00457-SMR-SBJ

Decided: December 12, 2022


Before the Court is Plaintiff's Motion to Alter or Amend the Judgment under Federal Rule of Civil Procedure 59(e). [ECF No. 20]. The Motion seeks reconsideration of the attorneys' fees awarded in an earlier decision.1 [ECF No. 22]. For the reasons below, Plaintiff's Motion is DENIED.


A. Previous Decision

On July 21, 2022, Plaintiff filed a Motion for Attorneys' Fees under 42 U.S.C. § 406(b)(1)(A) after receiving a favorable merits determination by the Social Security Administration. [ECF No. 20]. Plaintiff requested $34,496.00 in attorneys' fees based on the contingent-fee agreement signed by Plaintiff, Attorney Wes Kappelman, and Attorney Corbett Luedeman.2 [ECF No. 20 at 3–4]. In support of this Motion, Plaintiff provided a breakdown of the number of hours worked on the case and the total past-due benefits. [ECF No. 20-2 at 3]. After review of the entire record, the Court concluded that the number of hours worked, the hourly rate that counsel would earn if the award were provided in full, and the complexity of the case weighed against awarding the entire requested fee. [ECF No. 22 at 4–6]. The Court instead awarded attorneys' fees in the amount of $850.00 per hour, which was roughly a third of the requested fee. Id. at 6. This yielded a total fee of $11,730. Id.

B. Motion to Alter or Amend Judgment

On November 14, 2022, Plaintiff filed a Motion to Alter or Amend the Judgment pursuant to Federal Rule of Civil Procedure 59(e). [ECF No. 23]. The Motion asserts that the Court erred in determining the appropriate fee because it used previous cases to set a baseline hourly rate for fees under 42 U.S.C. § 406(b)(1). Id. at 3. It contends the Court did not properly evaluate the complexity of the case, particularly related to the Appointments Clause issue. Id. at 5–6. The Motion argues that the Court should consider the undue windfall Plaintiff's long term disability insurance carrier would earn if the money was not provided to Plaintiff's counsel. Id. at 8–9 (citing Andrews v. Bowen, 640 F. Supp. 1001, 1003 (W.D. N.C. 1986)).3 Based on these arguments, Plaintiff requested that “the Court amend or set aside its order dated October 14, 2022.” Id. at 10.

C. Consideration of Motion to Amend

As discussed in detail below, Plaintiff's three arguments are insufficient to convince the Court its previous order should be modified or wholly set aside. The Motion is therefore DENIED.

Rule 59(e) empowers district courts to alter or amend judgments. Fed. R. Civ. P. 59(e). Rule 59(e) was adopted “to make clear that the district court possesses the power to rectify its own mistakes in the period immediately following the entry of judgment.” Norman v. Ark. Dep't of Educ., 79 F.3d 748, 750 (8th Cir. 1996) (citation omitted). Motions under Rule 59(e) serve the limited function of correcting “manifest errors of law or fact or to present newly discovered evidence.” United States v. Metro. St. Louis Sewer Dist., 440 F.3d 930, 933 (8th Cir. 2006) (citation and internal quotations omitted). Rule 59(e) motions cannot “be used to relitigate old matters, or to raise arguments or present evidence that could have been raised prior to the entry of judgment.” Exxon Shipping Co. v. Baker, 554 U.S. 471, 485 n.5 (2008) (citation omitted). “To prevail on a Rule 59(e) motion, the movant must show that (1) the evidence was discovered after trial; (2) the movant exercised due diligence to discover the evidence before the end of trial; (3) the evidence is material and not merely cumulative or impeaching; and (4) a new trial considering the evidence would probably procedure a different result.” Metro. St. Louis Sewer Dist., 440 F.3d at 933 (citation omitted).

i. Hourly Rate

Plaintiff's first contention is the Court erred by effectively setting a traditional hourly rate for Social Security cases and then relying on this rate in its decision. [ECF No. 23 at 3]. This argument appears to misunderstand the prior order of the Court, which reviewed the wide variety of fee awards to conclude successful attorneys in Social Security cases are generally paid between $350 and $850 an hour. [ECF No. 22 at 3–5]. These decisions, which rarely grant counsel a fee that is equivalent to or greater than $1,000 an hour, provide guidance on how courts fashion an appropriate fee award in a variety of factual and legal circumstances. [ECF No. 23 at 4–6]. The Court used these decisions to illustrate the requested fee award – roughly $2,500 an hour – would be multiple times more than the awards other attorneys have received for engaging in similar, complex work. Id. Plaintiff's argument does not convince the Court that its method of calculating the hourly fee was a manifest error of law.

ii. Complexity of the Case

The second argument is the Court did not place sufficient weight on the complexity of novel Appointments Clause arguments in determining the amount Plaintiff's counsel should receive for this representation. [ECF No. 23 at 6] (citing Lucia v. SEC, 138 S. Ct. 2044 (2018)). He explains the complexity of this legal argument, and by extension the Court's error, is best shown by three factors: 1) that he sought assistance of additional counsel on the matter; 2) that he spent more time on the matter than shown by the records; and 3) that he wrote four pages of briefing on the matter. Id.

The Court briefly addresses each factor in turn. On the decision to secure additional assistance of external counsel on the Appointments Clause argument, the Court believes this information is best understood as counsel fulfilling his professional duty to provide McDonald with competent and knowledgeable representation. With respect to the argument that he spent a considerable amount of uncompensated time on tasks related to the issue, such as updating the Court on recent decisions, the Court cannot credit counsel for time not supported by appropriate documentation. Shepherd v. Apfel, 981 F. Supp. 1188, 1195 (S.D. Iowa 1997) (citing In Re Donovan, 877 F.2d 982, 994 (D.C. Cir. 1989)). On the contention of the complexity of the Appointments Clause issue itself, the Court's previous decision did not make clear, but should have, that the complexity of this issue is why the Court did not provide a rate below $850 an hour in light of the other factors. In short, these arguments do not convince the Court it should reconsider its previous decision.

iii. Windfall to Insurance Company

The third ground raised by Plaintiff is the Court did not consider two specific points: 1) the recommendation from Plaintiff's Long-Term Disability (“LTD”) carrier that counsel should receive the entire 25% fee award; and 2) the LTD carrier would receive an unearned windfall, in this case, reimbursement due to the work provided by counsel. [ECF No. 23 at 9]. Neither is compelling.

There are two separate issues with the contention that the LTD carrier recommended a certain fee for counsel. The first is that the LTD carrier did not actually provide a recommendation that 25% percent of past due benefits was a “reasonable” fee. [ECF No. 23 at 9]. The LTD carrier's letter states that “Attorney fees in the amount of $40,496.00 have been subtracted from the overpayment” and provides no additional context or elucidation. [ECF No. 20-3 at 1]. It is difficult to read this line as an endorsement of a full fee rather than a practice to refund the maximum amount identified by the agency to avoid future disputes with an attorney. Regardless of how this line is interpreted, a second issue is counsel repeatedly explained how the carrier's decision to terminate its representation of McDonald demonstrated poor judgment, but he now asks the Court to defer to the carrier. [ECF No. 23 at 9]. This contradiction makes this argument untenable. The first point is unpersuasive.

The second contention is equally unconvincing. It is not the prerogative of the Court to decide the question of who should receive this money. This is particularly true when the terms of the LTD contract are not before it and the LTD carrier is not a party to the current dispute. Therefore, the Court declines to revaluate its prior decision on this ground.


Plaintiff's counsel provided excellent representation for Plaintiff and deserves to be paid for this successful outcome. The Court, in its duty as an “independent check” held that the requested payment of $34,496.00 for 13.8 hours of work, was not reasonable. Gisbrecht v. Barnhart, 535 U.S. 789, 798 n.6 (2002). After full consideration of this Motion to Amend or Alter the Judgment, Plaintiff has not identified a manifest error or law or presented new evidence. The appropriate fee is still $850 an hour for the 13.8 hours of work, which yields a total fee of $11,730.00. The Motion is DENIED.


Dated this 12th day of December, 2022.


1.   The Court incorporates the legal standards laid out in the previous order into this one.

2.   It is well established that a “contingent fee arrangement does not bind the district court in its determination of the fee award.” Brissette v. Heckler, 784 F.2d 864, 866 (8th Cir. 1986) (citations omitted). However, courts are instructed “to afford deference to the contract, together with the other factors which the court must examine to determine the reasonableness of any fee charged.” Goff v. Sullivan, 739 F. Supp. 494, 498 (D. S.D. 1990) (footnote omitted).

3.   Plaintiff's counsel repeatedly cites this decision in the Motion for Reconsideration, but it was vacated in whole by the United States Court of Appeals for the Fourth Circuit. See Andrews v. Bowen, 818 F.2d 28 (Table), 1987 WL 37314 (4th Cir. Apr. 30, 1987).


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