Opinion
7:23-CV-1131-FL
07-24-2024
DARRYL RICHARDSON, Plaintiff/Claimant, v. MARTIN O'MALLEY, Commissioner of Social Security, Defendant.
MEMORANDUM AND RECOMMENDATION
ROBERT B. JONES, JR. UNITED STATES MAGISTRATE JUDGE
This matter is before the court on Claimant Darryl Richardson's (“Claimant”) opening brief filed pursuant to the Supplemental Rules for Social Security Actions, [DE-13], and the Commissioner's motion for remand pursuant to sentence four of 42 U.S.C. § 405(g), [DE-18]. Claimant filed this action pursuant to 42 U.S.C. §§ 405(g) and 1383(c)(3), seeking judicial review of the denial of his application for child disability benefits (“CDB”) under Title II. Claimant filed a memorandum in opposition to the motion for remand, [DE-20], and the time for further responsive briefing has expired. Having carefully reviewed the administrative record and the briefing submitted by the parties, it is recommended that the Commissioner's motion be allowed, and the matter be remanded for further proceedings.
I. STATEMENT OF THE CASE
Claimant began receiving Supplemental Security Income (“SSI”) benefits in October 2004, and received past due benefits dating back to October 2003. (R. 259-64). Claimant's SSI benefits were continued after a Continuing Disability Review (“CDR”) on August 17, 2016, and again on February 22, 2021. (R. 91-102, 224-25). On May 24, 2019, Claimant protectively filed an application for CDB, based on his mother's eligibility, for the period from August 19, 2001, when he turned 18 years of age, to August 19, 2005, when he turned 22 years of age. (R. 25, 29, 34851). The claim was denied initially and upon reconsideration. (R. 25, 71-90). A hearing before the Administrative Law Judge (“ALJ”) was held on October 20, 2020, but Claimant was unrepresented and the ALJ granted a continuance in order for Claimant to consult with an attorney. (R. 59-70). The hearing reconvened on May 24, 2022, and Claimant, represented by counsel, and a vocational expert (“VE”) appeared by telephone and testified. (R. 40-58). On July 7, 2022, the ALJ issued a decision denying Claimant's request for benefits. (R. 22-39). On May 3, 2023, the Appeals Council denied Claimant's request for review. (R. 1-6). Claimant then filed a complaint in this court seeking review of the now-final administrative decision.
IL STANDARD OF REVIEW
The scope of judicial review of a final agency decision regarding disability benefits under the Social Security Act (“Act”), 42 U.S.C. § 301 el seq., is limited to determining whether substantial evidence supports the Commissioner's factual findings and whether the decision was reached through application of the correct legal standards. See Coffman v. Bowen, 829 F.2d 514, 517 (4th Cir. 1987). “The findings of the Commissioner ... as to any fact, if supported by substantial evidence, shall be conclusive . . . .” 42 U.S.C. § 405(g). Substantial evidence is “evidence which a reasoning mind would accept as sufficient to support a particular conclusion.” Laws v. Celebrezze, 368 F.2d 640, 642 (4th Cir. 1966). While substantial evidence is not a “large or considerable amount of evidence,” Pierce v. Underwood, WL U.S. 552, 565 (1988), it is “more than a mere scintilla . . . and somewhat less than a preponderance.” Laws, 368 F.2d at 642. “In reviewing for substantial evidence, [the court should not] undertake to re-weigh conflicting evidence, make credibility determinations, or substitute [its] judgment for that of the [Commissioner].” Mastro v. Apfel, 270 F.3d 171, 176 (4th Cir. 2001) (quoting Craig v. Chater, 76 F.3d 585, 589 (4th Cir. 1996), superseded by regulation on other grounds, 20 C.F.R. § 416.927(d)(2)). Rather, in conducting the “substantial evidence” inquiry, the court's review is limited to whether the ALJ analyzed the relevant evidence and sufficiently explained his or her findings and rationale in crediting the evidence. Sterling Smokeless Coal Co. v. Akers, 131 F.3d 438, 439-40 (4th Cir. 1997). The Court's review of legal issues is plenary. Waggoner v. Kijakazi, No. 4:21-CV-03220-TER, 2022 WL 1423325, at *1 (D.S.C. May 5,2022) (citing Mitton v. Comm 'r of Soc. Sec., 670 Fed.Appx. 754, 755 (3d Cir. 2016)).
III. DISABILITY EVALUATION PROCESS
The disability determination is based on a five-step sequential evaluation process as set forth in 20 C.F.R. § 404.1520 under which the ALJ is to evaluate a claim:
The claimant (1) must not be engaged in “substantial gainful activity,” i.e., currently working; and (2) must have a “severe” impairment that (3) meets or exceeds [in severity] the “listings” of specified impairments, or is otherwise incapacitating to the extent that the claimant does not possess the residual functional capacity to (4) perform . .. past work or (5) any other work.Albright v. Comm 'r of the SSA, 174 F.3d 473,475 n.2 (4th Cir. 1999). “If an applicant's claim fails at any step of the process, the ALJ need not advance to the subsequent steps.” Pass v. Chater, 65 F.3d 1200, 1203 (4th Cir. 1995) (citation omitted). The burden of proof and production during the first four steps of the inquiry rests on the claimant. Id. At the fifth step, the burden shifts to the ALJ to show that other work exists in the national economy which the claimant can perform. Id. Additionally, in CDB cases, the claimant must have a disability that began before the attainment of age 22. 20 C.F.R. § 404.350.
When assessing the severity of mental impairments, the ALJ must do so in accordance with the “special technique” described in 20 C.F.R. § 404.1520a(b)-(c). This regulatory scheme identifies four broad functional areas in which the ALJ rates the degree of functional limitation resulting from a claimant's mental impairment(s): understanding, remembering, or applying information; interacting with others; concentrating, persisting, or maintaining pace; and adapting or managing oneself. Id. § 404.1520a(c)(3). The ALJ is required to incorporate into the written decision pertinent findings and conclusions based on the “special technique.” Id. § 404.1520a(e)(3).
IV. ALJ'S FINDINGS
Applying the above-described sequential evaluation process, the ALJ found Claimant was “not disabled” prior to August 8, 2005, the date he attained age 22. (R. 30). At step one, the ALJ found Claimant had not engaged in substantial gainful activity since June 1,2000, the alleged onset date. (R. 28). At step two, the ALJ determined that prior to the date Claimant attained age 22, there were no medical signs or laboratory findings to substantiate the existence of a medically determinable impairment. (R. 28-30). This ended the inquiry and resulted in an unfavorable decision for the Claimant.
V. DISCUSSION
Claimant argues that the ALJ erred by failing to apply collateral estoppel and res judicata to his CDB claim based on Claimant's prior favorable determination on his SSI claim and seeks judgment and an award of benefits or a remand of the matter for a new hearing. Pl.'s Br. [DE-13] at 4-8; Pl.'s Resp. [DE-20]. The Commissioner requests that the matter be remanded for further fact finding regarding whether Claimant is entitled to CDB benefits. Def.'s Br. [DE-19] at 3-5.
The period at issue for Claimant's CDB claim is August 19, 2001, when he turned 18 years of age, to August 19, 2005, when he turned 22 years of age. (R. 29). Claimant contends that under collateral estoppel the prior finding that he was eligible for SSI benefits as of September 1, 2003, satisfies the CDB claim requirement under 20 C.F.R. § 404.350 that he must have a disability that began before the attainment of age 22. The AL J found collateral estoppel did not apply where (1) the basis for the SSI decision was unknown because SSA lost the file (referred to by the SSA and the parties as the “lost folder”), and the subsequent continuances of Claimant's SSI benefits in 2016 and 2021 provided no substantive analysis; and (2) collateral estoppel does not apply when a claimant has an existing entitlement to SSI and files a subsequent application for CDB. (R. 30). The Commissioner does not defend the ALJ's decision but rather requests that the case be remanded for further fact finding regarding whether Claimant is entitled to CDB benefits. Thus, the court must determine whether the appropriate remedy is remand or an award of benefits.
Claimant first asks the court to apply collateral estoppel and to award CDB benefits based on the prior favorable SSI decision and subsequent continuations. Pl.'s Br. [DE-13] at 4-5. The ALJ incorrectly determined that collateral estoppel did not apply because Claimant's existing entitlement to SSI was under Title XVI and his subsequent application for CDB was under Title II. (R. 30). The regulations, in fact, expressly provide to the contrary:
An issue at your hearing may be a fact that has already been decided in one of our previous determinations or decisions in a claim involving the same parties, but arising under a different title of the Act or under the Federal Coal Mine Health and Safety Act. If this happens, the administrative law judge will not consider the issue again, but will accept the factual finding made in the previous determination or decision unless there are reasons to believe that it was wrong.20 C.F.R. § 404.950(f) (emphasis added); see Evon D. H. v. Kijakazi, No. 22-CV-1018-CJW-KEM, 2023 WL 7928704, at *8 (N.D. Iowa Sept. 27, 2023) (finding the ALJ erred in concluding that collateral estoppel could not apply because the claims fell under different titles), adopted by, 2023 WL 6939305 (N. D. Iowa Oct. 20, 2023). However, here, the court is unable to conclusively find that collateral estoppel does apply due to a change in relevant Listing of Impairments 12.00 relating to mental disorders after the 2003 SSI claim was allowed.
The 2016 decision continuing Claimant's SSI benefits indicates that the initial 2003 claim was based on mental impairments, including OCD, learning disability, anxiety, and depression. (R. 91). In 2017, the criteria for satisfying the mental health listings changed. See Bonnell v. Kijakazi, No. CV 21-73, 2023 WL 3739068, at *4 (E.D. Pa. May 30, 2023) (“It is not reasonably open to debate that the criteria for all 12.00 Listings, pertaining to mental health, were changed effective 2017.”); Griffin v. Berryhill, No. 7:17-CV-82-FL, 2018 WL 3018209, at *1 (E.D. N.C. May 31, 2018) (citing Soc. Sec. Admin., Revised Medical Criteria for Evaluating Mental Disorders, 81 Fed.Reg. 66138-01,2016 WL 5341732 (Sept. 26,2016) (revising, e.g., Listing 12.00 and Listing 12.04) (effective for applications filed and decisions made on or after Jan. 17, 2017), amended and corrected, 81 Fed.Reg. 86928, 2016 WL 7013725 (Dec. 26, 2016)), adopted by, 2018 WL 3015240 (E.D. N.C. June 15, 2018). The SSA's Program Operations Manual System (“POMS”)provides that “[w]hen the basis for the prior favorable determination or decision was meeting or equaling a listing, and that listing has substantially changed or become more restrictive (i.e., more difficult to satisfy), collateral estoppel does not apply.” POMS DI 27515.005B. Listing 12.00 is specifically cited within the table of listings that have substantially changed or become more restrictive. Id. (“When the basis for the prior favorable determination or decision was meeting or equaling a 12.00 listing before 01/17/2017, collateral estoppel does not apply and a new determination is required.”). Claimant fails to specifically address the Commissioner's argument that collateral estoppel does not apply due to the change in Listing 12.00 pursuant to POMS DI 27515.005B, see Pl.'s Mem. [DE-20], and it is not apparent due to the lost folder whether this is a 12.00 listings case to which collateral estoppel would not apply. Accordingly, the court cannot conclusively find on this administrative record that collateral estoppel warrants a favorable decision.
“POMS regulations do not have the force of law, but they are the authorized means for issuing Social Security policy and operating instructions.” Bonnell, 2023 WL 3739068, at *4 (citing Edelman v. Comm'r of Soc. Sec., 83 F.3d 68, 71 at n.2 (3d Cir. 1996)); see also Wash. State Dep't of Soc. & Health Servs. v. Guardianship Est. of Keffeler, 537 U.S. 371, 385 (2003) (explaining the POMS are “administrative interpretations” that, while not products of formal rulemaking, do “warrant respect”).
Claimant also argues that res judicata can be applied to award CBD benefits based on the prior SSI award. Pl.'s Br. [DE-13] at 6-7.
It is by now well-established that fundamental and familiar principles of res judicata apply in Social Security disability cases. Congress has clearly provided by statute that res judicata prevents reappraisal of both the Secretary's findings and his decision in Social Security cases that have become final, 42 U.S.C. § 405(h), and the courts have readily applied res judicata to prevent the Secretary from reaching an inconsistent result in a second proceeding based on evidence that has already been weighed in a claimant's favor in an earlier proceeding.Lively v. Sec'y of Health & Hum. Servs., 820 F.2d 1391, 1392 (4th Cir. 1987) (internal citations omitted). “The SSA treats the doctrine of res judicata as applying when it has ‘made a previous determination or decision ... on the same facts and on the same issue or issues, and this previous determination or decision has become final by either administrative or judicial action.'” Monroe v. Colvin, 826 F.3d 176, 187 (4th Cir. 2016) (20 C.F.R. §§ 404.957(c)(1), 416.1457(c)(1)). Due to the lost folder, the basis for the prior award is unclear and, as discussed above, given the change in the criteria for the mental health listings, the court cannot conclusively find that res judicata applies.
Finally, given the need for further fact finding, remand for further proceedings rather than an award of benefits is the appropriate remedy. “The decision of whether to reverse and remand for benefits or reverse and remand for a new hearing is one that ‘lies within the sound discretion of the district court.'” Perry v. Colvin, No. 5:13-CV-87-BO, 2014 WL 1056736, at *3 (E.D. N.C. Mar. 18, 2014) (quoting Edwards v. Bowen, 672 F.Supp. 230, 237 (E.D. N.C. 1987)). A remand for an award of benefits is appropriate “where the record does not contain substantial evidence to support a decision denying coverage under the correct legal standard and when reopening the record for more evidence would serve no purpose.” Breeden v. Weinberger, 493 F.2d 1002, 1012 (4th Cir. 1974); see also Lakeman v. Saul, No. 7:18-CV-97-BO, 2019 WL 4385498, at *2 (E.D. N.C. Sept. 12,2019) (“there is nothing to be gained from remanding this matter for further consideration and reversal for an award of benefits is appropriate”); McKinney v. Colvin, 111 F.Supp.3d 663, 667 (E.D. N.C. 2015) (remanding for benefits because another hearing “would serve no purpose”). However, “[i]f the reviewing court has no way of evaluating the basis for the ALJ's decision, then ‘the proper course, except in rare circumstances, is to remand to the agency for additional investigation or explanation.'” Radford v. Colvin, 734 F.3d 288, 295 (4th Cir. 2013) (quoting Fla. Power & Light Co. v. Lorion, 470 U.S. 729, 744 (1985)); see also Hall v. Berryhill, No. 7T6-CV-347-FL, 2018 WL 824488, at *3 (E.D. N.C. Feb. 12, 2018) (remanding for further proceedings “where further explanation by the ALJ may reveal that the decision is supported by substantial evidence”). The longevity of a case may be an important factor in determining whether an award of benefits or a new hearing is merited. See e.g., Hunter v. Colvin, No. 4:13-CV-235-BO, 2014 WL 6884054, at *2 (E.D. N.C. Dec. 3, 2014) (holding that “[r]eversal for an award of benefits is proper where, as here, the case has already been heard by the district court once before and the agency continues to make mistakes on remand,” and noting that the case had been pending for nine years); see Harshman v. Berryhill, No. 5:16-CV-261-FL, 2017 WL 3669621 (E.D. N.C. Aug. 8, 2017), adopted by, 2017 WL 3669516 (E.D. N.C. Aug. 24, 2017).
This is not a case where further proceedings would “serve no purpose.” McKinney, 111 F.Supp.3d at 667. The Commissioner requests a remand for further proceedings in order to allow SSA to locate or reconstruct the lost folder, if possible, so that the AL J can apply the correct law and SSA policies and consider the relevant issues on the merits, and it would not be prudent for the court to make a determination in the first instance. Radford, 734 F.3d at 296. Furthermore, while the period for adjudication is remote, Claimant did not file the claim at issue until 2019, the delay in adjudicating the claim was to allow Claimant to obtain counsel, and this is the first request for judicial review. See Breeden, 493 F.2d at 1011-12 (reversing for award of benefits where case was quite old, record had no need to be reopened, and the case had already been on appeal once before). Accordingly, a remand for further proceedings is appropriate in this case.
VI. CONCLUSION
For the reasons stated above, it is recommended the Commissioner's motion be allowed, and the matter be remanded for further proceedings.
IT IS DIRECTED that a copy of this Memorandum and Recommendation be served on each of the parties or, if represented, their counsel. Each party shall have until August 7, 2024 to file written objections to the Memorandum and Recommendation. The presiding district judge must conduct his or her own review (that is, make a de novo determination) of those portions of the Memorandum and Recommendation to which objection is properly made and may accept, reject, or modify the determinations in the Memorandum and Recommendation; receive further evidence; or return the matter to the magistrate judge with instructions. See, e.g., 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72(b)(3); Local Civ. R. 1.1 (permitting modification of deadlines specified in local rules), 72.4(b), E.D. N.C. Any response to objections shall be filed by within 14 days of the filing of the objections.
If a party does not file written objections to the Memorandum and Recommendation by the foregoing deadline, the party will be giving up the right to review of the Memorandum and Recommendation by the presiding district judge as described above, and the presiding district judge may enter an order or judgment based on the Memorandum and Recommendation without such review. In addition, the party's failure to file written objections by the foregoing deadline will bar the party from appealing to the Court of Appeals from an order or judgment of the presiding district judge based on the Memorandum and Recommendation. See Wright v. Collins, 766 F.2d 841, 846-47 (4th Cir. 1985).