Mar 29, 2016

Oh The Irony

     The United States Court of Appeals for the Second Circuit has affirmed two District Court decisions that held that Binder and Binder is barred from suing the Social Security Administration because the agency refused to pay attorney fees after the claimants that Binder and Binder had represented had their debts discharged in bankruptcy. The Court ruled that sovereign immunity barred the lawsuits. Of course, the irony here is that Binder and Binder is itself now in bankruptcy.

11 comments:

Anonymous said...

Say what you will about B and B but it appears that under that cowboy hat he saw something or heard something coming and sold out before this major shift in opinion. He got the money and the investment group got the bankruptcy. I do miss the commercials.

Anonymous said...

ALJ post is up

https://www.usajobs.gov/GetJob/ViewDetails/433604700/

Dan Smith said...

I went to the district court decision to get a couple of details not included in the circuit court decision. Below is a timeline for the facts in one of these cases:

5/3/12 - Claimant applies for DIB
6/29/12 - Claimant retains Binder & Binder
10/22/12 - Claimant's application is approved, $36,080 in backpay (!) and obviously what would have been a $6,000 maximum atty fee.

Does this aspect of the situation alone stink to anyone else? How can less than 4 months of Binder being connected to an initial application honestly justify a $6,000 fee? Mind you, this is before the firm even has access to any medical records gathered by state DDS. What kind of contributions can a firm possibly make at this stage to justify such a fee?

The rep group that once employed me as an associate used to relish representing claimants at the initial application level for this very reason. These cases were seen as the "real money-makers" and "money for nothing" and claimants with closely approaching hearings had their case preparations openly deprioritized due to a business choice to devote resources to filing as many initial applications as possible.

To me, this is one of the more disgusting open secrets in the status quo of disability representation today. In my own practice, I do represent claimants at the application stage, but I include a self-imposed $600 cap on fees for cases approved prior to a DDS denial. It cost me more in fees than I actually made last year (most of my clients are still waiting on hearings) but I get to go to bed at night knowing that I didn't cheat anyone.

Anonymous said...

Speaking of fee problems, I was informed today by a gentleman at Business Account Services that the Administration issued a Directive earlier this month that Treasury shall not release or process SS attorney fees after the 22nd of each month, and has also taken away overtime hours for SS employees to process attorney fees.

As a result, attorneys and reps shall only be paid fees during the first 21 days of each month. 25% of the year attorneys will not be paid.

Anonymous said...

@Dan:

I could barely read your post because of all the brilliant light shining off of your halo.

As long as clients are informed of the terms of the contingency fee contract and have the right to not enter into one, I don't see any problem with receipt of a significant fee on an initial application. We typically do more than act just as a scrivener for the client in submitting the application when we can, such as attempting to obtain medical source statements from providers and developing medical records to assist in moving the claim along more quickly.

Dan Smith said...

What medical records are you ordering that aren't duplicative of those DDS is ordering at the same level?

As for source statements, you honestly believe sending out a template form justifies a $6,000 fee?

TruthBtold said...

Dan:

11:47 indicated that they were obtaining records to expedite the case, i.e. order records at the time the case is filed so they could submit to the DDS, saving the DDS from having to develop.

I'm not sure where you read they were sending out "template" forms. Our office typically tailors a request to a medical source based on the nature of the client's condition and the specialty of the medical source.

You seem to have lost sight of the nature of a contingent fee contract. At the time it is entered into neither party knows how much time will go into the case. You are conducting an analysis after the fact, which is not the reality of the situation.

Dan Smith said...
This comment has been removed by the author.
Dan Smith said...

Ordering records on the initial application because you don't think DDS does it fast enough doesn't make much sense to me. By the time DDS gets around to making its decision, there will be months of meds that haven't been obtained yet, which DDS would then need to obtain anyway. To me it sounds at best excessive. Regardless, in the event that your firm actually does handle IA's that way, I'm clearly not talking about you. I'm talking about the 99.9% of IA rep claims that fall under the simple formula of:
1) sign up cl
2) file IA online
3) send one of Tom Bush's MSS forms to a treating doc. Maybe even follow up if you're feeling frisky.
4) remind cl to fill out reports and attend CE's
5) deposit your check

As for contingency agreements, per the MRPC the overall fee still needs to be reasonable. Given the paucity of contributions that can be made without access to an e-file at this stage, my argument is that any such fee approaching the 6K max is almost per se unreasonable.

Anonymous said...

@Dan Sometimes counseling a client about what do say, and not to say, and what to write and what not to write, and how to phrase it, it more valuable than medical records or anything else. It's called preparation and counseling, and it's what separates an attorney from a clerk. I'm not suggesting $6k or $36k is an appropriate fee, but you deny reality if you only focus on getting medical records as part of your legal practice (and that's the way attorneys work outside of SSA practice).

Anonymous said...

"What medical records are you ordering that aren't duplicative of those DDS is ordering at the same level?"

Dan, you must practice in a state with an unusually industrious DSS! In almost all of the cases that I've handled, I find that DSS has sought records going back only one year from the date of application. Extensive and careful interviewing of the client almost always reveals relevant medical records which are "missing." Also, in the semi-rural area where I practice, at least 50% of the clients I have represented have NOT visited a specialist for one or more significant conditions from which they suffer (especially mental impairments). After reviewing the existing treatment records and CE's, I push my client to see necessary specialists, and often refer them myself. There are very few cases in which the records are fully developed as they should be. Remember, part of fees paid to a professional are to compensate for special knowledge--not mere clerical work!

Continent fees are also designed to allow counsel to obtain fees to compensate for cases worked that end up as total losers. Dan, if you're so successful in winning your cases that you don't think you should take contingent fees in a few easily won cases, you're probably choosing your cases too carefully and should not turn away some additional claimants who need representation. (Something like a local attorney who bragged to have a 100% acquittal rate on his DUI cases--if one believed him).