Opinion
5:21-CV-00131-M
05-04-2022
Ricky Lane Burgess, Plaintiff, v. Kilolo Kijakazi, Acting Commissioner of Social Security, Defendant.
MEMORANDUM & RECOMMENDATION
ROBERT T. NUMBERS, II, UNITED STATES MAGISTRATE JUDGE
Plaintiff Ricky Burgess challenges Administrative Law Judge (ALJ) Wanda L. Wright's denial of his application for social security income. Burgess claims that ALJ Wright erred in failing to resolve between the testimony of the Vocational Expert (VE) and the Dictionary of Occupational Titles (DOT) and (2) determining that his use of a cane was not medical necessary. Burgess also challenges the constitutionality of the Social Security Administration's structure. Both Burgess and Defendant Kilolo Kijakazi, Acting Commissioner of Social Security, have moved for a judgment on the pleadings in their favor. D.E. 17, 19.
After reviewing the parties' arguments, the court has determined that ALJ Wright reached the appropriate determination. At step five, there is no unresolved conflict between the testimony of the VE and the DOT about other work Burgess could perform. ALJ Wright explained why Burgess's use of a cane was not medically required. And Burgess has not stated a viable constitutional challenge to the Administration's organization. So the undersigned recommends that the court deny Burgess's motion, grant the Acting Commissioner's motion, and affirm the Commissioner's determination.
The court has referred this matter to the undersigned for entry of a Memorandum and Recommendation. 28 U.S.C. § 636(b).
I. Background
In January 2018, Burgess applied for disability benefits alleging a disability that began in December 2016. After the Social Security Administration denied his claim at the initial level and upon reconsideration, Burgess appeared before ALJ Wright for a hearing to determine whether he was entitled to benefits. ALJ Wright determined Burgess had no right to benefits because he was not disabled. Tr. at 22-31.
ALJ Wright found that Burgess's degenerative disc disease, degenerative joint disease, arthritis, right quadriceps tear, chronic pain syndrome, asthma, obstructive sleep apnea, and obesity were severe impairments. Tr. at 24. ALJ Wright also found that Burgess's impairments, either alone or in combination, did not meet or equal a Listing impairment. Tr. at 25.
ALJ Wright then determined that Burgess had the residual functional capacity (RFC) to perform light work with other limitations. Tr. at 26. He requires the option to change between sitting and standing at 30-minute intervals. Id. Burgess can occasionally operate foot controls with his lower left extremity but never operate them with his lower right extremity. Id. He can occasionally climb ramps and stairs but can never climb ladders, ropes, or scaffolds. Id.
Burgess can occasionally balance, stoop, kneel, crouch, and crawl. Id. He can frequently handle and finger bilaterally. Id. He must avoid concentrated exposure to moving, hazardous machinery and unprotected heights. Id. And he must also avoid exposure to pulmonary irritants, fumes, odors, dust, gases, and poor ventilation. Id.
ALJ Wright concluded that Burgess could not perform his past work as a security guard or detention officer. Tr. at 29-30. But considering his age, education, work experience, and RFC, ALJ Wright found that jobs existed in significant numbers in the national economy that Burgess could perform. Tr. at 30-31. These include cashier, shipping/receiving weigher, and counter clerk. Id. Thus, ALJ Wright found that Burgess was not disabled. Tr. at 31.
After unsuccessfully seeking review by the Appeals Council, Burgess began this action in March 2021. D.E. 5.
II. Analysis
A. Standard for Review of the Commissioner's Final Decision
When a social security claimant appeals a final decision of the Commissioner, the district court's review is limited to determining whether, based on the entire administrative record, there is substantial evidence to support the Commissioner's findings. 42 U.S.C. § 405(g); Richardson v. Perales, 402 U.S. 389, 401 (1971). Substantial evidence is defined as “evidence which a reasoning mind would accept as sufficient to support a particular conclusion.” Shively v. Heckler, 739 F.2d 987, 989 (4th Cir. 1984) (quoting Laws v. Celebrezze, 368 F.2d 640, 642 (4th Cir. 1966)). The court must affirm the Commissioner's decision if it is supported by substantial evidence. Smith v. Chater, 99 F.3d 635, 638 (4th Cir. 1996).
B. Standard for Evaluating Disability
In making a disability determination, the ALJ engages in a five-step evaluation process. 20 C.F.R. § 404.1520; see Johnson v. Barnhart, 434 F.3d 650 (4th Cir. 2005). The ALJ must consider the factors in order. At step one, if the claimant is engaged in substantial gainful activity, the claim is denied. At step two, the claim is denied if the claimant does not have a severe impairment or combination of impairments significantly limiting him or her from performing basic work activities. At step three, the claimant's impairment is compared to those in the Listing of Impairments. See 20 C.F.R. Part 404, Subpart P, App. 1. If the impairment is listed in the Listing of Impairments or if it is equivalent to a listed impairment, disability is presumed. But if the claimant's impairment does not meet or equal a listed impairment, the ALJ assesses the claimant's RFC to determine, at step four, whether he can perform his past work despite his impairments. If the claimant cannot perform past relevant work, the analysis moves on to step five: establishing whether the claimant, based on his age, work experience, and RFC can perform other substantial gainful work. The burden of proof is on the claimant for the first four steps of this inquiry but shifts to the Commissioner at the fifth step. Pass v. Chater, 65 F.3d 1200, 1203 (4th Cir. 1995).
C. Medical Background
Burgess has a history of back pain as well as some issues with his hands and feet that predate his alleged disability onset date. Tr. at 27. His diagnoses include degenerative disc disease and chronic ankyloses as well as osteoarthritis. Id.
In February 2018, Burgess tore his right quadriceps tendon, which required surgical repair. Id. Following surgery, providers provided regular pain management. Id. And Burgess received a knee brace and knee injections for his pain. Id.
By June 2018, Burgess was doing very well. Id. At a follow-up orthopedic visit, he denied knee pain and estimated he had regained 90% of his functioning. Id. But the next day when attending a pain management appointment, Burgess reported throbbing pain in his back and knees. Id. His examination noted no remarkable findings. Id. One month later, he again claimed throbbing pain in his back and knees. Id. But an examination again found no significant abnormalities. Id.
Around this time Burgess also reported left foot pain. Tr. at 28. An MRI showed an intact ligament, although there was speculative evidence of degenerative arthrosis. Id.
In March 2019, Burgess complained of bilateral knee pain. Tr. at 27. The knee brace helped his stability. Id. On examination, Burgess had some knee tenderness but retained full strength and range of motion. Id. And he had a normal heel-toe gait. Id. An x-ray revealed mild medial joint space narrowing with subchondral sclerosis but no acute osseous abnormalities. Id.
At an appointment the next month, Burgess complained of pain in his back, knees, and hands. Id. Providers noted that Burgess used a cane for stability. Id. But his gait was within normal limits. Id.
State agency physicians concluded that Burgess could perform light work with exertional and postural limitations. Tr. at 105-07, 121-23. They remarked that Burgess had no hand dysfunction and met his physical therapy goals. Tr. at 29.
Burgess claimed pain in his legs and back prevent him from working. Tr. at 26. He stated that he has used a cane since 2014, with more use since his injury. Id. He participated in physical therapy for two weeks but could not afford to continue treatment. Id.
Burgess sees a pain management specialist monthly, takes medication, and receives injections. Id. He reported that his pain interferes with his sleep. Id.
D. Step Five
Burgess argues that ALJ Wright's step five finding is flawed. For other jobs he can perform, Burgess contends there is an apparent conflict between the testimony of the VE and the DOT. Because ALJ Wright failed to resolve a discrepancy between his RFC and the jobs identified by the VE, Burgess asserts that remand is warranted. The Acting Commissioner asserts, and the undersigned agrees, that there is no conflict or error in ALJ Wright's step five determination.
As noted above, while a claimant has the burden at steps one through four, it is the Commissioner's burden at step five to show that work the claimant can perform is available. Pass, 65 F.3d at 1203 (citing Hunter v. Sullivan, 993 F.2d 21, 35 (4th Cir. 1992)). “The Commissioner may meet this burden by relying on the Medical-Vocational Guidelines (Grids) or by calling a vocational expert to testify.” Aistrop v. Barnhart, 36 Fed.Appx. 145, 146 (4th Cir. 2002) (citing 20 C.F.R. § 404.1566). The Grids are published tables that take administrative notice of the number of unskilled jobs at each exertional level in the national economy. 20 C.F.R. Pt. 404, Subpt. P, App. 2 § 200.00(a).
When a claimant suffers solely from exertional impairments, the Grids may satisfy the Commissioner's burden of coming forward with evidence on the availability of jobs the claimant can perform. Grant v. Schweiker, 699 F.2d 189, 192 (4th Cir. 1983). When a claimant: (1) suffers from a non-exertional impairment that restricts his ability to perform work of which he is exertionally capable, or (2) suffers an exertional impairment which restricts him from performing the full range of activity covered by a work category, the ALJ may not rely on the Grids and must produce specific vocational evidence showing that the national economy offers employment opportunities to the claimant. See Walker v. Bowen, 889 F.2d 47, 49 (4th Cir. 1989); Hammond v. Heckler, 765 F.2d 424, 425-26 (4th Cir. 1985); Cook v. Chater, 901 F.Supp. 971 (D. Md. 1995); 20 C.F.R. Pt. 404, Subpt. P, App. 2, § 201.00(h).
The Regulations permit testimony from a VE to determine “whether [a claimant's] work skills can be used in other work and the specific occupations in which they can be used[.]” 20 C.F.R. §§ 404.1566(e), 416.966(e). For a VE's testimony to be relevant, an ALJ's hypothetical question must represent all of a claimant's substantial impairments. Walker, 889 F.2d at 50; Burnette v. Astrue, No. 2:08-CV-0009-FL, 2009 WL 863372, at *4 (E.D. N.C. Mar. 24, 2009) (relevant hypothetical question should adequately reflect claimant's RFC and fairly set out a claimant's limitations). If limitations are omitted, the VE's testimony is of limited value, and may not constitute substantial evidence. See Johnson, 434 F.3d at 659 (citing Walker, 889 F.2d at 50).
Before relying on a VE's testimony an ALJ must “[i]dentify and obtain a reasonable explanation for any conflicts between occupational evidence provided by VEs . . . and information in the Dictionary of Occupational Titles (DOT), . . . and [e]xplain in the determination or decision how any conflict that has been identified was resolved.” SSR 00-4p, 2000 WL 1898704 (Dec. 4, 2000). “Occupational evidence provided by a VE . . . generally should be consistent with the occupational information supplied by the DOT.” Id. “When there is an apparent unresolved conflict between VE . . . and the DOT, the adjudicator must elicit a reasonable explanation for the conflict before relying on the VE . . . to support a determination or decision about whether the claimant is disabled.” Id. “At the hearings level, as part of the adjudicator's duty to fully develop the record, the adjudicator will inquire, on the record, as to whether or not there is such consistency.” Id.
The Fourth Circuit has interpreted SSR 00-4p as placing an “affirmative duty” on the ALJ to independently “identify conflicts between the [VE's] testimony and the [DOT].” Pearson v. Colvin, 810 F.3d 204, 208-09 (4th Cir. 2015). “An ALJ has not fully developed the record if it contains an unresolved conflict between the [VE's] testimony and the [DOT].” Id. at 210.
ALJ Wright posed a hypothetical question to the VE. In response, the VE identified three jobs at the light exertional level suitable for an individual with that RFC. Burgess contends that this work exceeds his abilities because he is limited to standing for four hours, and light work generally involves standing or walking for about six hours.
The undersigned identifies no conflict between the jobs identified by the VE and the DOT. ALJ Wright's RFC did not limit Burgess to standing for four hours. Instead, it included an option to allow him to alternate between sitting and standing every 30 minutes.
This is confirmed by the hearing transcript. ALJ Wright's first hypothetical question to the VE involved a person who could stand for about six hours in an eight-hour workday. Tr. at 69-70 (“Please assume a hypothetical individual of the claimant's age, education and work background who can perform at this light exertional level. The individual can stand and/or walk for about six hours out of an eight-hour workday and sit for up to six hours out of an eight-hour workday.”) (emphasis added). The hypothetical question allowed the individual to alternate sitting and standing every 30 minutes. Id. And it set forth additional exertional, postural, and environmental restrictions. Id.
The VE identified the three positions-cashier, shipping/receiving weigher, and counter clerk. These positions suit a person with the same vocational profile as in ALJ Wright's first hypothetical question. And because this hypothetical question mirrored Burgess's RFC, ALJ Wright found that he can perform these jobs. Tr. at 30-31.
The VE also noted that her testimony followed the DOT, aside for some limitations like the sit/stand option, which the DOT did not address. Tr. at 71-72. On matters not directly referenced by the DOT, the VE based her testimony on her education, training, experience, and knowledge of how jobs are performed in the labor market. Id.
Contrary to Burgess's claim, the RFC did not restrict him to four hours of standing. So there was no conflict that ALJ Wright needed to resolve at step five. She thus could rely on the VE's testimony about the availability of other work suitable for Burgess.
The Acting Commissioner has met her burden of identifying other work that Burgess could perform at step five. So the undersigned recommends that the court deny Burgess's claim on this issue.
E. Cane
Burgess next contends that ALJ Wright erred in determining his use of a cane was not medically necessary. The Acting Commissioner asserts that ALJ Wright properly assessed his RFC and use of a cane. The undersigned finds that substantial evidence supports ALJ Wright's RFC determination, including her finding about the medical need for a cane.
The RFC is a determination, based on all the relevant medical and non-medical evidence, of what a claimant can still do despite her impairments; the assessment of a claimant's RFC is the responsibility of the ALJ. See 20 C.F.R. §§ 404.1520, 404.1545, 404.1546; SSR 96-8p, 1996 WL 374184, at *2. If more than one impairment is present, the ALJ must consider all medically determinable impairments, including medically determinable impairments that are not “severe,” when determining the claimant's RFC. Id. §§ 404.1545(a), 416.945(a). The ALJ must also consider the combined effect of all impairments without regard to whether any such impairment, if considered separately, would be of sufficient severity. Id. § 404.1523; see Walker, 889 F.2d at 50 (“[I]n evaluating the effect[] of various impairments upon a disability benefit claimant, the [Commissioner] must consider the combined effect of a claimant's impairments and not fragmentize them.”).
The ALJ must provide “findings and determinations sufficiently articulated to permit meaningful judicial review.” DeLoatche v. Heckler, 715 F.2d 148, 150 (4th Cir. 1983); see also Wyatt v. Bowen, 887 F.2d 1082, 1989 WL 117940, at *4 (4th Cir. 1989) (per curiam). The ALJ's RFC determination “must include a narrative discussion describing how the evidence supports each conclusion, citing specific medical facts (e.g. laboratory findings) and nonmedical evidence (e.g. daily activities, observations).” Mascio v. Colvin, 780 F.3d 632, 636 (4th Cir. 2015) (quoting SSR 96-8p). Furthermore, “[t]he record should include a discussion of which evidence the ALJ found credible and why, and specific application of the pertinent legal requirements to the record evidence.” Radford v. Colvin, 734 F.3d 288, 295 (4th Cir. 2013). Fourth Circuit precedent “makes it clear that it is not [the court's] role to speculate as to how the ALJ applied the law to [her] findings or to hypothesize the ALJ's justifications that would perhaps find support in the record. Fox v. Colvin, 632 Fed.Appx. 750, 755 (4th Cir. 2015).
Social Security Ruling 96-8p explains how adjudicators should assess residual functional capacity. The Ruling instructs that the residual functional capacity “assessment must first identify the individual's functional limitations or restrictions and assess his or her work-related abilities on a function-by-function basis, including the functions” listed in the regulations. “Only after that may [residual functional capacity] be expressed in terms of the exertional levels of work, sedentary, light, medium, heavy, and very heavy.” SSR 96-8p. The Ruling further explains that the residual functional capacity “assessment must include a narrative discussion describing how the evidence supports each conclusion, citing specific medical facts (e.g., laboratory findings) and nonmedical evidence (e.g., daily activities, observations).” Id.
There is no “per se rule requiring remand when the ALJ does not perform an explicit function-by-function analysis[.]” Mascio, 780 F.3d at 636. But “[r]emand may be appropriate . . . where an ALJ fails to assess a claimant's capacity to perform relevant functions, despite contradictory evidence in the record, or where other inadequacies in the ALJ's analysis frustrate meaningful review.” Id. (quoting Cichocki v. Astrue, 729 F.3d 172, 177 (2d Cir. 2013)). The function-by-function requirement can be satisfied by reference to a properly conducted analysis by a state agency consultant. See, e.g., Linares v. Colvin, No. 5:14-CV-00129, 2015 WL 4389533, at *3 (W.D. N.C. July 17, 2015) (“Because the ALJ based his RFC finding, in part, on the function-by-function analysis of the State agency consultant, the ALJ's function-by-function analysis complied with [Soc. Sec. Ruling] 96-8p.” (citing Lemken v. Astrue, No. 5:07-CV-33-RLV-DCK, 2010 WL 5057130, at *8 (W.D. N.C. July 26, 2010))).
“The requirement to use a hand-held assistive device may ... impact ... [an] individual's functional capacity by virtue of the fact that one or both upper extremities are not available for such activities as lifting, carrying, pushing, and pulling.” 20 C.F.R. Part 404, Subpt. P, App. 1, § 1.00J4. Thus, an ALJ must consider the effect of “medically required” hand-held assistive devices. Eason v. Astrue, No. 2:07-CV-30-FL, 2008 WL 4108084, at *16 (E.D. N.C. Aug. 29, 2008); SSR 96-9, 1996 WL 374185, at *7 (July 2, 1996).
A hand-held assistive device is “medically required” if “medical documentation establish[es] the need for a hand-held assistive device to aid in walking or standing, and describing the circumstances for which it is needed.” SSR 96-9p, 1996 WL 374185, at *7. “The claimant bears the burden of presenting ‘medical evidence establishing the need for a cane and describing the circumstances for which it is needed.'” Gilmer v. Berryhill, No. 3:17-CV-539-FDW, 2018 WL 3518470, at *2 (W.D. N.C. July 20, 2018) (quoting SSR 96-9p). “[A] prescription or the lack of a prescription for an assistive device is not necessarily dispositive of medical necessity.” Fletcher v. Colvin, No. 1:14-CV-380, 2015 WL4506699, at *8 (M.D. N.C. July 23, 2015) (citing Staples v. Astrue, 329 Fed.Appx. 189, 191-92 (10th Cir. 2009)).
Burgess claimed that ALJ Wright improperly relied on SSR 96-2p, which has been rescinded. As the Acting Commissioner point out, ALJ Wright cited SSR 96-9p, which remains in effect.
Whether the need for a hand-held assistive device affects functional capacity depends on the particular circumstances of the case. For example, a person who requires a hand-held assistive device in one hand to walk may be able to use the other hand to perform requirements of many occupations. SSR 96-9p. “On the other hand, the occupational base for an individual who must use such a device for balance because of significant involvement of both lower extremities ... may be significantly eroded.” Id.
ALJ Wright found that Burgess could perform work at the light level, with postural, manipulative, and environmental limitations. Tr. at 26. She included a limitation the he have the option of alternating between sitting and standing every 30 minutes. Id. But ALJ Wright did not incorporate the use of a handheld assistive device into the RFC.
In addressing Burgess's use of a cane, ALJ Wright remarked the evidence failed to establish the medical necessity of a hand-held assistive device. Tr. at 28. She noted that medical documentation establishing the need for an assistive device and describing the circumstances for which it is needed was necessary for a finding of medical necessity. Id. The record contained no such documentation. Id. Yet in formulating the RFC, ALJ Wright considered any difficulties Burgess had in standing, walking, or balancing. Id.
Burgess argues that a prescription does not decide the issue of the medical necessity of an assistive device. And he claims that ALJ Wright erred by failing to reconcile evidence that he used a cane, noted throughout the record, with her RFC determination which excludes the use of a cane.
The undersigned finds Burgess's argument unpersuasive. As noted above, a claimant may establish the medical necessity of an assistive device without a prescription establishing its need and circumstances. Fletcher, 2015 WL4506699, at *8. The relevant inquiry is not whether a cane is “prescribed” but whether it is “medically required.” See Spaulding v. Astrue, 379 Fed.Appx. 776, 780 (10th Cir. 2010). So an ALJ may still consider a claimant's statements about the use of an assistive device with the objective medical evidence, including the lack of a prescription, in determining whether a cane is medically required. Christon v. Colvin, No. 3:15-CV-00305-RJC, 2016 WL 3436423, at *5 (W.D. N.C. June 15, 2016).
The Regulations state that establishing the medical necessity of a hand-held assistive device requires medical documentation. SSR 96-9p, 1996 WL 374185, at *7. The documentation must establish its need and the circumstances for which it is required. Id. And it is Burgess's burden to present evidence establishing that a cane was medically required. Gilmer, 2018 WL 3518470, at *2.
Burgess maintains that the record documents his use of an assistive device. ALJ Wright noted that Burgess used a cane. Tr. at 26, 28. But other evidence showed it was not medically required.
Following his injury and surgery, Burgess returned to 90% of baseline functionality. Tr. at 28. Examinations consistently found minimal, if any, musculoskeletal abnormalities. Id. Even when he used a cane, his gait was normal. Tr. at 27, 28. And the state agency physicians did not find that Burgess required an assistive device. Tr. at 103-07, 117-25. These findings constitute substantial evidence supporting ALJ Wright's conclusion that Burgess's use of a cane was not medically necessary. Jackson v. Kijakazi, No. 1:20-CV-592, 2021 WL 3037436, at *5-6 (M.D. N.C. July 19, 2021).
In sum, ALJ Wright did not err in omitting an assistive device from the RFC determination. Because substantial evidence in the record supports her findings, this issue does not establish a basis for remand. Thus, the court should reject Burgess's argument on this issue.
F. Social Security Administration's Structure
Burgess's final argument is that the statutory limitations on the President's ability to remove the Commissioner of Social Security violates the Constitution. He maintains that this unconstitutional removal restriction deprives the Commissioner of the authority to promulgate regulations, make a final decision about whether he is entitled to benefits, or delegate decisionmaking authority to ALJs and the Appeals Counsel. Burgess asks the court to remand the case to for a hearing before another ALJ.
The Acting Commissioner agrees that the limitation on the President's removal power is unconstitutional. But, even so, she says that Burgess is not entitled to relief. She provides several reasons why this is so, including that Burgess has shown no harm stemming from the Legislative Branch's encroachment on the Executive Branch's authority.
This dispute centers on the statutory language governing when the President may dismiss the Commissioner of Social Security. The relevant statute provides that instead of serving at the pleasure of the President, the chief executive may only relieve the Commissioner of his duties after making “a finding . . . of neglect of duty or malfeasance in office.” 42 U.S.C. § 902(a)(3).
Claimants argue this limitation is unconstitutional under the Supreme Court's decision in Seila Law v. CFPB, 140 S.Ct. 2183 (2020). In Seila Law, the Court held that the Constitution does not allow Congress to limit the President's removal authority “when it comes to principal officers who, acting alone, wield significant executive power.” Id. at 2211. And, as noted above, the Acting Commissioner agrees with Burgess on this point.
Seila Law, however, is not the only decision relevant to this question. The court must also consider how the Supreme Court's decision in Collins v. Yellen, 141 S.Ct. 1761 (2021), applies here. Collins involved the Federal Housing Finance Agency. The FHFA was “an independent agency” responsible for regulating Fannie Mae and Freddie Mac, “two of the Nation's leading sources of mortgage financing.” Id. at 1770. The companies suffered significant losses” during the 2008 housing crisis “and many feared that their troubling financial condition would imperil the national economy.” Id. The agency was led by “a single Director, whom the President could remove only for cause.” Id. (quotation omitted).
In addition to regulating the companies, FHFA could “if necessary, step[] in as their conservator or receiver.” Id. And “[s]hortly after the FHFA came into existence, it placed Fannie Mae and Freddie Mac into conservatorship and negotiated agreements for the companies with the Department of Treasury.” Id. One of those agreements “which the parties refer to as the ‘third amendment' or ‘net worth sweep,' caused the companies to transfer enormous amounts of wealth to [the] Treasury [Department].” Id.
The third amendment “resulted in a slew of lawsuits[.]” Id. Among them was a suit by “[a] group of Fannie Mae's and Freddie Mac's shareholders [who] challenged the third amendment on statutory and constitutional grounds.” Id. Their constitutional challenge “argued that the FHFA's structure violates the separation of powers because the Agency is led by a single Director who may be removed by the President only for cause.” Id. (quotation omitted). The shareholders “sought declaratory and injunctive relief, including an order requiring Treasury either to return the variable dividend payments or to re-characterize those payments as a pay down on Treasury's investment.” Id. The Supreme Court agreed that the FHFA's structure violated the Constitution, noting that its “decision last Term in Seila Law is all but dispositive.” Id. at 1783.
The court then turned to the remedy for the FHFA's unconstitutional structure. The shareholders took the position “that the third amendment must be completely undone.” Id. at 1787. They argued that due to the constitutional defect, “the third amendment was adopted and implemented by officers who lacked constitutional authority and that their actions were therefore void ab initio.” Id.
The Supreme Court rejected this argument. It noted that “[a]lthough the statute unconstitutionally limited the President's authority to remove the confirmed Directors, there was no constitutional defect in the statutorily prescribed method of appointment to that office.” Id. (emphasis in original). Since the officers were properly appointed to their positions, “there is no reason to regard any of the actions taken by the FHFA in relation to the third amendment as void.” Id.
But the Court did not close off all potential sources of relief for the shareholders. It noted that “the possibility that the unconstitutional restriction on the President's power to remove a Director of the FHFA could have” harmed the shareholders “cannot be ruled out.” Id. at 1788. The Court noted that they may be able to show harm if the President had tried to remove the Director but was thwarted by a court that found there was no cause for his removal. Id. The parties could also show they were harmed by the removal provision if “the President had made a public statement expressing displeasure with actions taken by a Director and had asserted that he would remove the Director if the statute did not stand in the way.” Id. The Supreme Court remanded the case to allow the lower courts to determine whether the shareholders had indeed suffered such harm. Id.
The fact that the Supreme Court remanded the case for further proceedings on this question defeats any suggestion that the court should apply a presumption that Burgess suffered a compensable harm.
In an attempt to satisfy Collins's requirements, Burgess sets out several different alleged harms. See Supp. Br. at 22. But these arguments all rely on the same central premise. According to Burgess, the unconstitutional removal restriction deprived the Commissioner of the power to take any official acts, including making benefits determinations. Since he lacked the power to make a benefits determination himself, he had no decision-making authority to delegate to the ALJ or Appeal Counsel.
The Supreme Court explicitly rejected this type of argument in Collins. It explained that “the unlawfulness of the removal provision does not strip the [officer] of the power to undertake the other responsibilities of his office[.]” Collins, 141 S.Ct. at 1788 n.23. This is so because of the distinction between a challenge based on an officer's appointment and a challenge based on the President's ability to remove an officer from their position. An improperly appointed officer's acts are void ab initio because they “involve[] a Government actor's exercise of power that the actor did not lawfully possess.” Id. at 1788. But so long as “there was no constitutional defect in the statutorily prescribed method of appointment to office . . . there is no reason to regard any of the actions taken by the [actor] . . . as void.” Id. at 1787. Burgess has not challenged the Commissioner's appointment, so there is no basis for the court to find that he lacked the authority to act.
Relying on several appointment clause cases, Burgess says that the court should presume that the unconstitutional removal restriction harmed her. But given the distinction drawn by the Supreme Court between cases challenging an officer's appointment and those challenging an officers removal, this argument is unpersuasive.
Cases dealing with the traceability element of the test for Article III standing provide no support for such claims. See Sylvia A. v. Kijakazi, No. 5:21-CV-076, 2021 WL 4692293, at *4 (N.D. Tex. Sept. 13, 2021); Albert v. Kijakazi, No. 1:21-CV-0004, 2021 WL 3424268, at *5 (D. Alaska Aug. 5, 2021); Tafoya v. Kijakazi, No. 21-CV-00871, 2021 WL 326065, at *5 (D. Colo. July 29, 2021). To satisfy the traceability requirement, a plaintiff must show that their injury “is fairly traceable to the defendant's conduct[.]” Collins, 141 S.Ct. at 1179. But when considering standing the court is not focusing on whether the alleged injury can be traced to the allegedly unconstitutional removal restriction. See Collins, 141 S.Ct. at 1779. Instead, it looks to “whether the plaintiffs' injury can be traced to allegedly unlawful conduct of the defendant, not to the provision of law that is challenged.” Id. (quotations omitted). So cases on traceability are not persuasive on whether Burgess suffered a compensable harm from the unconstitutional removal restriction.
Burgess also argues that the fact that President Biden fired the Commissioner (who was appointed by a prior President) in 2021 shows that he has been harmed by the unconstitutional removal restriction. According to Burgess, the fact that the President fired the Commissioner several months into his term shows that he “believed he could not remove” him. Supp. Br. at 23. And, according to Burgess, the fact that the President did not do so until after Collins shows that the President “would have terminated” the Commissioner earlier if he believed he “could do so despite the for-cause tenure provision.” Id. at 23-24
But Burgess's arguments about the circumstances leading up to the Commissioner's termination are simply speculation. There is nothing in the Complaint or in the administrative record that supports this conclusion.
Nor is there anything else in the Complaint or the administrative record that establishes the harm required by Collins. To begin with, neither of the examples the Court gave of circumstances that would show a compensable harm are present here. There is no indication that the President unsuccessfully tried to remove the Commissioner. And this is also not a situation where the President publicly expressed his displeasure with the Commissioner and his frustration that the removal restriction prevented the Commissioner's firing. To the contrary, the President publicly expressed his dissatisfaction with the Commissioner in the letter removing him from his position.
It does not appear that the Supreme Court intended these two examples to be the only ways a party can show compensable harm from an unconstitutional removal restriction. So the lower courts will, for the time being, need to flesh out what a party must allege or show to satisfy Collins's compensable harm standard. That showing will need to focus on the constitutional concerns underling Seila Law and Collins: ensuring the President's ability to control those who act on his behalf and ensuring the People's ability to hold the President accountable for those actions. See Seila Law, 140 S.Ct. at 2202-03.
Without attempting to catalog all the ways these interests can be implicated, it suffices to say that they are not implicated here. Burgess has not alleged that the outcome of this case contravened the President's policy preference, so the President's authority to control those who work for him is not implicated here. And, as far as this case goes, the Acting Commissioner has, like her predecessor, taken the position that Burgess is not entitled to benefits. So if the body politic is dissatisfied with the outcome here, they can elect a President with a different viewpoint on the issues involved.
The Supreme Court has rejected the argument that all actions taken by an officer serving under an unconstitutional removal restriction are void. Instead, it requires a plaintiff to show that the removal restriction resulted in an action that caused them harm. Since Burgess has neither alleged nor shown such a harm here, the District Court should reject his argument on this point. III. Conclusion
For these reasons, the undersigned recommends that the court deny Burgess's Motion for Judgment on the Pleadings (D.E. 17), grant Kijakazi's Motion for Judgment on the Pleadings (D.E. 19), and affirm the Commissioner's determination.
The Clerk of Court must serve a copy of this Memorandum and Recommendation (M&R) on each party who has appeared in this action. Any party may file a written objection to the M&R within 14 days from the date the Clerk serves it on them. The objection must specifically note the portion of the M&R that the party objects to and the reasons for their objection. Any other party may respond to the objection within 14 days from the date the objecting party serves it on them. The district judge will review the objection and make their own determination about the matter that is the subject of the objection. If a party does not file a timely written objection, the party will have forfeited their ability to have the M&R (or a later decision based on the M&R) reviewed by the Court of Appeals.