Wake Forest Law Review

By: Kristina Wilson

On Thursday, January 19, 2017, the Fourth Circuit issued a published opinion in the civil case Patterson v. Commissioner of Social Security Administration. The Fourth Circuit reversed and remanded the Administrative Law Judge’s (“ALJ”) denial of the plaintiff’s disability benefits due to his failure to evaluate the plaintiff’s alleged mental impairment according to the “special technique” required by 20 C.F.R. § 404.1520a. The Fourth Circuit held that although failing to follow the special technique does not always necessitate remand, in this case, it was not a harmless error.

Facts and Procedural History

On July 21, 2010, the plaintiff filed her initial application for Social Security benefits. After the Social Security Administration (“SSA”) denied her application, the plaintiff filed a timely request for a hearing on May 12, 2011. The ALJ at the hearing upheld the denial of the plaintiff’s benefits, holding that she was not disabled during the period for which she sought benefits. The ALJ based this determination primarily on the conclusions of one doctor. The SSA conceded that the ALJ failed to follow the appropriate “special technique” protocol outlined in 20 C.F.R. § 404.1520a and that the ALJ failed to consider contradictory medical evidence. The plaintiff then filed suit in district court, but district court sided with the ALJ, stating that substantial evidence supported the ALJ’s findings and that the failure to use the special technique constituted harmless error. The plaintiff appealed from these findings.

The ALJ Failed to Employ the Special Technique

When evaluating a claimant’s alleged mental impairment, an ALJ must follow the special technique. 20 C.F.R. § 404.1520a(a). Under the special technique, an ALJ must evaluate the alleged mental impairment according to four areas of functional limitation including activities of daily living, social functioning, concentration, persistence, or pace, and episodes of decompensation. 20 C.F.R. § 404.1520a(c)(4). The ALJ must rate his findings in the final area, episodes of decompensation, according to a four-point scale. Id. Next, the ALJ determines if the mental impairment is severe and whether it qualifies as a listed impairment. Id. § 404.1520a(d). The regulation requires the ALJ to specifically document all of the steps of the special technique. Id.

Here, the ALJ relied on the findings of only two doctors and did not document the steps of the special technique. Moreover, the record contained evidence that conflicted with the doctors’ findings, but the ALJ did not address the discrepancies. The SSA conceded that the ALJ did not properly apply the special technique and that the doctors’ opinions were not a sufficient surrogate for the special technique.

The Fourth Circuit Cannot Apply the Special Technique

The SSA argues, as a matter of first impression, that the Fourth Circuit can apply the special technique on appeal. If the Fourth Circuit found that the ALJ’s denial of benefits was proper, it could affirm the district court’s opinion. However, the Fourth Circuit disagreed with this argument, stating that the plain language of the special technique statute requires the SSA to apply the special technique. 20 C.F.R. § 404.1520a(e). Therefore, according to the Fourth Circuit, the special technique could not have been intended as nonbinding guidance to aid reviewing courts. The Fourth Circuit further reasoned that the SSA frequently issues such nonbinding guidance, and if it had intended for the special technique to be nonbinding guidance, it would not have engaged in the burdensome regulation promulgation process. Finally, the Fourth Circuit reasoned that failure to apply and properly document the special technique in administrative hearings actually hampers judicial review by obscuring the manner in which the ALJ handled different types of evidence. Thus, the Fourth Circuit concluded that it could not independently apply the special technique.

The Failure to Apply the Special Technique Was Not Harmless Error

Although the failure to apply the special technique does not automatically require remand in every case, the failure in this case was not harmless. The Fourth Circuit stated that the ALJ’s failure to make and support his findings severely hindered judicial review. The Fourth Circuit had no way of knowing how the ALJ evaluated crucial factors such as the plaintiff’s IQ. Moreover, the Fourth Circuit could not ascertain how the ALJ weighed and treated the conflicting evidence. Thus, the Fourth Circuit was unable to say whether substantial evidence supported the ALJ’s findings because the ALJ failed to document and explain his findings according to mandatory procedure.

Conclusion

The Fourth Circuit did not reach the merits of the plaintiff’s application for disability benefits. Instead, it reversed the district court’s findings and remanded the case to the ALJ, directing him to follow the requirements of all applicable regulations.

 

 

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By: Mikhail Petrov

On December 17, 2015, in the civil case of Pearson v. Colvin, the Fourth Circuit reversed and remanded the decision of the district court to deny Jeffrey Pearson (“Pearson”) his application for Social Security disability benefits. Pearson argues the administrative law judge (“ALJ”) failed to resolve a conflict between a vocational expert’s testimony and the Dictionary of Occupational Titles (Social Security Administration resource that lists occupations existing in the economy and explains some of the physical and mental requirements of those occupations). The Fourth Circuit agreed with Pearson.

The Facts of the Case

Pearson worked in a number of fields, including as a groundskeeper and a press operator in a plastics factory. On February 5, 2009 Pearson was laid off; He applied for Social Security disability benefits six weeks later. The application was denied initially, and then again upon rehearing. An ALJ affirmed the denial. The Social Security Appeals Council granted review, and remanded the case for further consideration, including testimony from a vocational expert.

In the second ALJ hearing, the judge asked the expert that if the expert’s testimony differed from what was contained in the Dictionary of Occupational Titles (“Dictionary”), to advice both Pearson’s counsel and the judge. The expert agreed to do so.

The vocational expert concluded that Pearson could work as a motel cleaner, cashier, or machine tender/bench press operator. Thus, the ALJ concluded that Pearson could perform jobs that exist in significant numbers in the national economy. Pearson was again found to be ineligible for disability benefits.

Pearson appealed to the district court, which granted summary judgment to the Commissioner. Pearson appealed, arguing that the district court erred in recommending that the ALJ’s findings be affirmed because ALJ did not resolve a conflict between the vocational expert’s testimony and the Dictionary as to whether the jobs identified by the expert required an ability Pearson did not have—to frequently reach overhead with both arms.

What Constitutes a Disability?

There are five prongs that must be met to be eligible for disability. The claimant has the burden of proof on the first four prongs. Then, the Commissioner bears the burden to prove the fifth prong, that the claimant is able to perform alternative work. In the fifth prong, the ALJ considers the claimant’s age, education, work experience, and residual functional capacity in order to decide whether he can perform alternative work that exists in significant numbers in the national economy. According to the Social Security Administration Policy Interpretation Ruling (“Interpretation Ruling”), to answer the question of whether “sufficient other work exists for the claimant in the national economy” the ALJ relies primarily on the Dictionary. The ALJ “may also use” a vocational expert to address complex aspects of the employment determination, including the expert’s observations of what a particular job requires in practice or the availability of given positions in the national economy.

Lastly, the expert’s testimony can sometimes conflict with the Dictionary. The Interpretation Ruling requires that the ALJ inquire, on the record, whether the vocational expert’s testimony conflicts with the Dictionary, and also requires that the ALJ to elicit a reasonable explanation for and resolve conflicts between the expert’s testimony and the Dictionary. The ALJ must, by determining if the vocational expert’s explanation is reasonable, resolve conflicts “before relying on the [expert’s] evidence to support a determination or decision about whether the claimant is disabled.”

The parties disputed two aspects of the Interpretation Ruling: (1) whether the Interpretation Ruling requires the ALJ only to ask the vocational expert whether his testimony conflicts with the Dictionary or also requires the ALJ to identify conflicts independently from the vocational expert; and (2) if the ALJ must independently identify conflicts, which conflicts the Interpretation Ruling requires an ALJ to identify.

ALJ Must Independently Identify Conflict Between Vocational Expert and Dictionary.

Pearson maintained that the Interpretation Ruling required the ALJ to do more than just ask the vocational expert if his testimony conflicts with the Dictionary. Instead, the Interpretation Ruling required the ALJ to independently identify all possible conflicts between the expert’s testimony and the Dictionary. The Commissioner argued that the Interpretation Ruling imposes on the ALJ only the single affirmative responsibility to ask the vocational expert whether his testimony conflicts with the Dictionary.

The Fourth Circuit agreed with Pearson that an ALJ has not fulfilled his affirmative duty merely because the vocational expert responds “yes” when asked if her testimony is consistent with the Dictionary. ALJ independently must identify conflicts between the expert’s testimony and the Dictionary.

Conflicts That the ALJ Must Identify 

The language of the Interpretation Ruling explains which conflicts the ALJ must identify and resolve before relying on the vocational expert’s testimony. Though the Interpretation Ruling uses several adjectives to describe the relevant conflict, the most common and the most compelling is “apparent,” which has two definitions: “obvious,” and “seeming real or true, but not necessarily so”

The context of the word “apparent” makes it clear that the Interpretation Ruling intends the latter meaning, that the ALJ must identify where the expert’s testimony seems to, but does not necessarily, conflict with the Dictionary. The Interpretation Ruling explains that if the vocational expert’s evidence appears to conflict with the Dictionary, the adjudicator will obtain a reasonable explanation for the apparent conflict. Additionally, the title of one of the Interpretation Ruling’s section is “Conflicts or Apparent Conflicts.” That title would be redundant if “apparent” meant “obvious.”

This definition of “apparent” embraces the reality that, in many cases, testimony may only appear to conflict with the Dictionary, and the vocational expert may be able to explain that there actually is not a conflict.

However, if the ALJ does not elicit this explanation, then the expert’s testimony cannot provide substantial evidence to support the ALJ’s decision. An expert’s testimony that apparently conflicts with the Dictionary can only provide substantial evidence if the ALJ has received this explanation from the expert and determined that the explanation is reasonable and provides a basis for relying on the testimony rather than the Dictionary.

Definition of “Reaching”

The Fourth Circuit examined the issue of whether the ALJ fulfilled his duty to make an independent identification of apparent conflicts and concluded that it did not. The vocational expert testified that Pearson was not disabled because he could perform three occupations available in sufficient numbers in the national economy. For all three, the Dictionary lists frequent reaching as a requirement, and the ALJ found that Pearson’s non-dominant arm could only occasionally reach upward. The question then turned on whether “reaching” refers to frequent reaching or infrequent reaching. The Fourth Circuit found that rather than applying the same meaning of “reaching” to each occupation, the ALJ and the expert should address exactly what form of reaching the stated occupations requires. Additionally, because the Commissioner is required to prove that other work “exist[s] in significant numbers in the national economy,” it is not enough that some jobs exist where Pearson’s disability is non-circumstantial.

Holding

The Fourth Circuit reversed the decision of the district court to deny Pearson’s Social Security Disability Benefits and remanded the case back to determine exactly what form of reaching the occupations stated by the vocational expert requires.

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By Elissa Hachmeister

In Tanner v. Commissioner of Social Security, an unpublished opinion issued on February 12, 2015, the Fourth Circuit affirmed the District Court for the District of South Carolina’s judgment upholding the Social Security Administration’s decision to deny Madeline Brown Tanner’s claim for disability insurance benefits. Although the district court erroneously failed to consider some of Tanner’s arguments after incorrectly applying the “mandate rule,” the Fourth Circuit nonetheless affirmed because its independent assessment of all Tanner’s challenges showed that the agency’s decision was supported by substantial evidence. Thus, even if the district court had considered all her arguments, reversal still would not have been warranted.

Tanner’s Twice Denied Claim and District Court Review

Tanner applied for disability insurance benefits, but her claim was denied after a hearing before an administrative law judge (ALJ). Tanner sought review of the decision, filing suit in the United States District Court for the District of South Carolina challenging the ALJ’s determinations regarding three main issues: (1) opinion evidence; (2) Tanner’s credibility; and (3) the effects of her impairments in combination. A magistrate judge recommended remand for additional consideration of opinion evidence, but rejected Tanner’s other arguments. Accepting the recommendation, the district court vacated the agency’s decision denying Tanner disability benefits.

On remand, Tanner had a second hearing before a different ALJ, but her claim was again denied. She filed suit to appeal the decision, raising substantially the same challenges as before. The magistrate judge recommended the district court uphold the second decision. In reviewing the second agency decision, the magistrate judge did not consider Tanner’s challenges to the ALJ’s determinations on the issues of credibility and the effects of her impairments in combination. The judge reasoned that these arguments had already been rejected; those earlier determinations were “the law of the case” and thus the “mandate rule” prohibited further review. The district court accepted the magistrate judge’s recommendation, adopting the judge’s assessment in its decision upholding the second denial of benefits.

Improper Application of the “Mandate Rule”

The district court, through the magistrate judge, was confused in its application of the “mandate rule,” which prohibits lower courts from considering questions that have been resolved by a higher court. The Fourth Circuit presumed, without deciding, that the mandate rule applies to agencies; thus the Social Security Administration (SSA) must respect the mandate or decision of the district court or an appellate court on remand. Nonetheless, the mandate rule did not require the ALJ to reconsider only certain opinion evidence on remand under the circumstances in this case. New evidence was presented at the second hearing, obliging the ALJ to reassess Tanner’s disability claim de novo per agency regulations. ALJ findings based on new evidence do not violate any earlier mandate set by a district court or an appellate court.

Reviewing an SSA Disability Determination 

An SSA disability determination will be upheld if the ALJ has applied correct legal standards and the ALJ’s factual findings are supported by substantial evidence. Bird v. Comm’r of Soc. Sec. Admin., 699 F.3d 337, 340 (4th Cir. 2012). The same standard of review applies whether the reviewing court is a district court or an appellate court. Because the district court did not fully consider Tanner’s challenges to the second agency decision, the Fourth Circuit undertook its own independent assessment of all of Tanner’s arguments. The Fourth Circuit found that the ALJ determinations challenged by Tanner were supported by substantial evidence. The district court’s mistaken invocation of the mandate rule was therefore harmless error since reversal would not have been appropriate even if all of Tanner’s arguments had been considered.

Court of Appeals for the Fourth Circuit Affirmed

By David Darr

Today, in Schaller v. Colvin, an unpublished per curium opinion, the Fourth Circuit dismissed an appeal from the Eastern District of North Carolina due to failure to enter a timely appeal. Because of this, the Eastern District of North Carolina’s decision denying William Howard Schaller social security benefits stood.

Was Schaller’s Appeal Timely?

The only issue that the Fourth Circuit needed to decide in this appeal was whether Schaller’s notice of appeal was filed timely.

The Eastern District of North Carolina Denied Schaller Social Security Benefits

On December 1, 2009, Schaller filed an application for a period of disability and disability insurance benefits with the Social Security Administration (SSA) alleging disability since September 18, 2002. Schaller claimed disability from sleep apnea, circadian rhythm disorder, morbid obesity, degenerative disc disease, depression, and a history of alcohol abuse. Schaller claimed that he could no longer work at the North Carolina Department of Transportation as a result of these conditions causing him to be unable to sleep. Schaller claimed that he could not keep a regular sleep schedule and function at his job. The SSA denied his claim initially and again upon reconsideration. Schaller appealed and was heard before an administrative law judge (ALJ). The ALJ found that Schaller suffered from severe impairments that resulted in a mild limitation to daily living, mild difficulties in social functioning, and moderate difficulties in concentration. These impairments made it so that Schaller could no longer work at his previous job. However, these limitations were not severe enough to eliminate Schaller from the work force and he could find gainful employment at a number of existing jobs. Therefore, the ALJ denied Schaller’s claim.

Schaller then brought the current action against Carolyn Colvin, Acting Commissioner of the SSA, in the Eastern District of North Carolina, pursuant to 42 U.S.C. §§ 405(g), 1383(c)(3), to seek judicial review of the SSA’s denial of disability benefits. Each party filed cross-motions for summary judgment.  A magistrate found that the ALJ’s decision was not erroneous. The magistrate issued a recommendation that the district court grant the SSA’s motion for summary judgment. The district court then adopted the magistrate’s recommendation as a final decision, dismissing Schaller’s action and upholding the decision of the SSA to deny Schaller’s claim. Schaller filed the current appeal sixty-two days after the district court’s final judgment was entered.

Parties Are Given Sixty Days to File a Notice of Appeal

Rule 4(a)(1)(B)(ii) of the Federal Rules of Appellate Procedure gives parties in a civil action to which an agency of the United States is a party sixty days after the district court’s entry of judgment to file a notice of appeal.

Schaller Filed His Appeal Too Late

Schaller filed his notice of appeal sixty-two days after the district court entered final judgment. Sixty-two days is not considered a timely appeal unless the district court extends the period. Timely filing a notice of appeal in a civil case is a jurisdictional requirement for the appellate court. An appellate court is forced to dismiss an appeal for lack of jurisdiction if the notice of appeal was not timely filed. Therefore, the Fourth Circuit was forced to dismiss the appeal because it was not timely filed.

The Forth Circuit Denied Schaller’s Appeal

The Fourth Circuit dismissed the appeal for lack of jurisdiction because the appeal was not timely filed.

By: Katharine Yale

Today, in Jones v. Astrue, an unpublished opinion, the Fourth Circuit affirmed an Administrative Law Judge’s decision to deny Jones’ application for insurance disability benefits.   The ALJ found that Jones’ hearing loss, knee pain, and foot problems did not render her disabled.

Substantial Evidence is the Standard of Review for the ALJ’s Denial.

In reviewing the ALJ’s conclusion, the Fourth Circuit was limited to evaluating whether the correct law was applied, and whether the ALJ’s findings were supported by substantial evidence.   Evidence is substantial when a reasonable mind might accept the relevant evidence as adequate to support the conclusion.   In the case that there is conflicting evidence, the reviewing court will defer to the ALJ’s conclusion, if the conflicting evidence would allow reasonable minds to differ.

The ALJ’s Decision to Deny Jones’ Disability Application Was Supported By Substantial Evidence.

The Fourth Circuit found that the ALJ correctly gave less weight to the opinions of Audiologist Fowler and Dr. Redmond. The two opinions were inconsistent with other substantial evidence such as Jones’ ability to perform everyday activities and communicate effectively at the hearings.

Additionally, the Fourth Circuit found that the ALJ was correct in not fully crediting Jones’ testimony regarding her impairment. Jones was able to communicate effectively at the hearing in front of the ALJ, and described her daily activities in a way that lessened the effect of her testimony regarding her impairment. This evidence supported the ALJ’s decision to give the testimony less credit.

Jones’ remaining two arguments were not raised at the district court and therefore could not be considered on appeal. The Fourth Circuit found, to the extent that Jones challenged the ALJ’s conclusion that her knee pain was not sufficiently severe, that the conclusion was supported by substantial evidence.   Even though Jones reported pain, the evidence presented showed that she pulled her knee while working out, and that the injury did not present a disabling condition.

The Fourth Circuit Affirmed the ALJ’s Decision to Deny Jones’ Application for Disability Benefits.

By Dan Menken

Last Tuesday, in Reid v. Commissioner of Social Security, the Fourth Circuit evaluated the Social Security disability benefit claims of Brian Edward Reid under Title II of the Social Security Act, 42 U.S.C. §§ 401-434. Reid filed for disability benefits on December 7, 2006, alleging that he became unable to work on June 4, 2004, when he fell of a roof during work and suffered two spinal fractures. This original claim was denied.

A hearing was then conducted before an administrative law judge (“ALJ”), who ruled that because Reid could engage in sedentary work, he was not disabled. On review of the decision, the Appeals Council remanded the case, ordering the ALJ to consider the evidence from June 4, 2004, forward, which the ALJ had not done because he thought that res judicata applied to the 2004-2006 period. The Appeals Council also instructed the ALJ to consider the effect of Reid’s mental impairments and obesity on his disability claims. After a second hearing on January 18, 2011, Reid was denied benefits for a second time. Reid again appealed to the Appeals Council, which largely adopted the ALJ’s findings.

On this appeal to the Circuit Court, Reid contended that (1) the Commissioner ignored several years of his medical history and (2) the Commissioner failed to consider the combined effects of his multiple impairments. In reviewing the district court’s judgment de novo, the Court of Appeals reviewed the Commissioner’s decision for substantial evidence.

In considering Reid’s first claim, the Court ruled that the Commissioner’s decision satisfied the statutory requirements because the Commissioner had stated that the whole record had been considered. Without evidence to the contrary, the Court decided to take the Commissioner at her word. In support of this ruling, the Court remarked that Reid had failed to point to any specific piece of evidence that, if considered, might have changed the outcome of his disability claim.

In regards to the second claim, the Court ruled that the ALJ had specifically contemplated the combinatorial effects of Reid’s various impairments as required by statute and complied with guidance set out in Walker, which states that the ALJ must “adequately explain his or her evaluation of the combined effects of [a claimant’s] impairments.” Even after considering the combined effects of the claimant’s impairments, the ALJ ruled that the combined impairments did not “equal in severity” to an impairment listed under Title II of the Social Security Act.