Calcagni v. Bisignano

• Court: District Court, E.D. Washington
• Decided: September 23, 2025
• Docket: 4:25-cv-05008
• Status: Unknown

Opinion

1 2 3 FILED IN THE U.S. DISTRICT COURT 4 EASTERN DISTRICT OF WASHINGTON Sep 23, 2025 5 SEAN F. MCAVOY, CLERK 6 7 UNITED STATES DISTRICT COURT 8 EASTERN DISTRICT OF WASHINGTON 9 10 11 BERNARDO C., No. 4:25-CV-5008-SAB 12 Plaintiff, 13 v. ORDER REVERSING THE 14 COMMISSIONER OF SOCIAL DECISION OF COMMISSIONER 15 SECURITY ADMINISTRATION, 16 Defendant. 17 18 Plaintiff brings this action seeking judicial review of the Commissioner of 19 Social Security’s final decision denying his application for social security benefits. 20 Plaintiff is represented by Matthew McGarry. The Commissioner is represented by 21 Benjamin Groebner and Brian M. Donovan. Pending before the Court is Plaintiff’s 22 Opening Brief, ECF No. 16, and the Commissioner’s Brief, ECF No. 20. 23 After reviewing the administrative record and briefs filed by the parties, the 24 Court is now fully informed. For the reasons set forth below, the Court reverses the 25 Commissioner’s decision and remands for an immediate award of benefits. 26 I. Jurisdiction 27 On May 13, 2022, Plaintiff filed an application for disability insurance 28 benefits (DIB), and supplemental security income (SSI), alleging disability 1 beginning July 30, 2018. Plaintiff’s application was denied initially and on 2 reconsideration. Plaintiff requested a hearing and on September 7, 2023, a 3 telephonic hearing was held. Plaintiff appeared and testified before an ALJ, who 4 issued a decision finding Plaintiff was not disabled on November 1, 2023. Plaintiff 5 appealed that decision, and the Appeals Counsel vacated the opinion and remanded 6 Plaintiff’s case. 7 A hearing was held on August 5, 2024 before an ALJ. Plaintiff appeared and 8 testified with the assistance of counsel Peter Natale. Jeffrey Tittlefitz, vocational 9 expert, also participated. The ALJ found Plaintiff was not disabled. 10 Plaintiff requested review by the Appeals Council and the Appeals Council 11 denied the request on November 27, 2024. The Appeals Council’s denial of review 12 makes the ALJ’s decision the “final decision” of the Commissioner of Social 13 Security, which this Court is permitted to review. 42 U.S.C. §§ 405(g), 14 1383(c)(1)(3). 15 Plaintiff filed a timely appeal with the United States District Court for the 16 Eastern District of Washington on February 13, 2025. ECF No. 1. The matter is 17 before this Court pursuant to 42 U.S.C. § 405(g). 18 II. Five-Step Sequential Evaluation Process 19 The Social Security Act defines disability as the “inability to engage in any 20 substantial gainful activity by reason of any medically determinable physical or 21 mental impairment which can be expected to result in death or which has lasted or 22 can be expected to last for a continuous period of not less than twelve months.” 42 23 U.S.C. §§ 423(d)(1)(A), 1382c(a)(3)(A). A claimant shall be determined to be 24 under a disability only if their impairments are of such severity that the claimant is 25 not only unable to do their previous work, but cannot, considering claimant’s age, 26 education, and work experiences, engage in any other substantial gainful work that 27 exists in the national economy. 42 U.S.C. §§ 423(d)(2)(A), 1382c(a)(3)(B). The 28 Commissioner has established a five-step sequential evaluation process to 1 determine whether a person is disabled in the statute. See 20 C.F.R. §§ 2 404.1520(a)(4)(i)-(v), 416.920(a)(4)(i)-(v). 3 Step One: Is the claimant engaged in substantial gainful activities? 20 4 C.F.R. §§ 404.1520(a)(4)(i), 416.920(a)(4)(i). Substantial gainful activity is work 5 done for pay and requires compensation above the statutory minimum. Keyes v. 6 Sullivan, 894 F.2d 1053, 1057 (9th Cir. 1990). If the claimant is engaged in 7 substantial activity, benefits are denied. 20 C.F.R. § 404.1520(b), 416.920(b). If 8 the claimant is not, the ALJ proceeds to step two. 9 Step Two: Does the claimant have a medically-severe impairment or 10 combination of impairments? 20 C.F.R. §§ 404.1520(a)(4)(ii), 416.920(a)(4)(ii). A 11 severe impairment is one that lasted or must be expected to last for at least 12 12 months and must be proven through objective medical evidence. Id. §§ 404.1509, 13 416.909. If the claimant does not have a severe impairment or combination of 14 impairments, the disability claim is denied. Id. § 404.1520(a)(4)(ii), 15 416.920(a)(4)(ii). If the impairment is severe, the evaluation proceeds to the third 16 step. 17 Step Three: Does the claimant’s impairment meet or equal one of the listed 18 impairments acknowledged by the Commissioner to be so severe as to preclude 19 substantial gainful activity? 20 C.F.R. §§ 404.1520(a)(4)(iii), 416.920(a)(4)(iii). If 20 the impairment meets or equals one of the listed impairments, the claimant is 21 conclusively presumed to be disabled. 20 C.F.R. §§ 404.1520(d), 416.920(d). If the 22 impairment is not one conclusively presumed to be disabling, the evaluation 23 proceeds to the fourth step. 24 Before considering to the fourth step, the ALJ must first determine the 25 claimant’s residual functional capacity. An individual’s residual functional 26 capacity is their ability to do physical and mental work activities on a sustained 27 basis despite limitations from their impairments. 20 C.F.R. §§ 404.1545(a)(1), 28 416.945(a)(1). The residual functional capacity is relevant to both the fourth and 1 fifth steps of the analysis. 2 Step Four: Does the impairment prevent the claimant from performing work 3 they have performed in the past? 20 C.F.R. §§ 404.1520(a)(4)(iv), 4 416.920(a)(4)(iv). If the claimant is able to perform their previous work, they are 5 not disabled. 20 C.F.R. §§ 404.1520(f), 416.920(f). If the claimant cannot perform 6 this work, the evaluation proceeds to the fifth and final step. 7 Step Five: Is the claimant able to perform other work in the national 8 economy in view of their age, education, and work experience? 20 C.F.R. §§ 9 404.1520(a)(4)(v), 416.920(a)(4)(v). The initial burden of proof rests upon the 10 claimant to establish a prima facie case of entitlement to disability benefits. Tackett 11 v. Apfel, 108 F.3d 1094, 1098 (9th Cir. 1999). This burden is met once a claimant 12 establishes that a physical or mental impairment prevents him from engaging in her 13 previous occupation. Id. At step five, the burden shifts to the Commissioner to 14 show that the claimant can perform other substantial gainful activity. Id. 15 III. Standard of Review 16 The Commissioner’s determination will be set aside only when the ALJ’s 17 findings are based on legal error or are not supported by substantial evidence in the 18 record as a whole. Matney v. Sullivan, 981 F.2d 1016, 1018 (9th Cir. 1992) (citing 19 42 U.S.C. § 405(g)). Substantial evidence is “more than a mere scintilla,” 20 Richardson v. Perales, 402 U.S. 389, 401 (1971), but “less than a preponderance,” 21 Sorenson v. Weinberger, 514 F.2d 1112, 1119 n.10 (9th Cir. 1975). Substantial 22 evidence is “such relevant evidence as a reasonable mind might accept as adequate 23 to support a conclusion.” Richardson, 402 U.S. at 401. 24 A decision supported by substantial evidence will be set aside if the proper 25 legal standards were not applied in weighing the evidence and making the decision. 26 Brawner v. Secr’y of Health & Human Servs., 839 F.2d 432, 433 (9th Cir. 1988). 27 An ALJ is allowed “inconsequential” errors as long as they are immaterial to the 28 ultimate nondisability determination. Stout v. Comm’r, Soc. Sec. Admin., 454 F.3d 1 1050, 1055 (9th Cir. 2006). The Court must uphold the ALJ’s denial of benefits if 2 the evidence is susceptible to more than one rational interpretation, one of which 3 supports the decision of the administrative law judge. Batson v. Barnhart, 359 F.3d 4 1190, 1193 (9th Cir. 2004). It “must consider the entire record as a whole, 5 weighing both the evidence that supports and the evidence that detracts from the 6 Commissioner’s conclusion, and may not affirm simply by isolating a specific 7 quantum of supporting evidence.” Revels v. Berryhill, 874 F.3d 648, 654 (9th Cir. 8 2017) (quotation omitted). “If the evidence can support either outcome, the court 9 may not substitute its judgment for that of the ALJ.” Matney, 981 F.2d at 1019. 10 IV. Statement of Facts 11 The facts have been presented in the administrative record, the ALJ’s 12 decision, and the briefs to this Court. Only the most relevant facts are summarized 13 herein. 14 Plaintiff previously worked at the Washington State Penitentiary in Walla, 15 Walla, Washington. While working, he began to hear voices. Eventually he lost his 16 job and became depressed. Plaintiff began using methamphetamine to cope with 17 stress and the voices. He states the voices and auditory hallucinations are slowly 18 getting worse. He has occasional thoughts of harming himself due to wanting to be 19 rid of the voices, as well as suicidal thoughts. Plaintiff has experienced 20 homelessness. He has had encounters with the police. He experiences paranoia, 21 disorganized thoughts, difficulty in maintaining focus in conversations, and has 22 admitted to episodes of rage and violence during which he did not feel in control of 23 his actions. 24 At the time of the August 2024 hearing, Plaintiff was an inpatient at 25 Waypoint in Walla Walla, Washington. He was brought there by the police after he 26 was suicidal. In being at Waypoint, Plaintiff had stopped using drugs, but he 27 continued to experience regular auditory hallucinations. He continues to 28 experience paranoia and persecutory delusions, and sometimes he is unable to 1 sleep because he does not trust people. He also has anger outbursts and frustration 2 with others. 3 V. The ALJ’s Findings 4 The ALJ issued an opinion affirming denial of benefits. AR 19-31. 5 At step one, the ALJ found that Plaintiff has not engaged in substantial 6 gainful activity since July 30, 2018. AR 22. 7 At step two, the ALJ identified the following severe impairments: substance 8 use disorder; anxiety disorder; depressive disorder; and schizoaffective disorder. 9 AR 22. 10 At step three, the ALJ found that Plaintiff did not have an impairment or 11 combination of impairments that meets or medically equals the severity of one of 12 the listed impairments. AR 23. Ultimately, the ALJ concluded Plaintiff has a 13 residual function capacity (“RFC”) to perform:

14 perform medium work as defined in 20 CFR 404.1567(c) and 15 416.967(c), except he is limited to performing simple tasks. He is restricted to low-stress work, meaning no production-rate pace such as 16 conveyor-belt work or non-worker-controlled pace. He requires a 17 predictable work environment. He must avoid interactions with the public as a job requirement. He can have superficial interaction with 18 coworkers and supervisors. Interaction with supervisors may increase 19 to a higher level when necessary for training. AR 24. 20 At step four, the ALJ found Plaintiff has no past relevant work. AR 29. 21 The ALJ found there were other jobs that existed in significant numbers in 22 the national economy that Plaintiff could also, including janitor, laborer, stores, 23 and auto-detailer. AR 30. Consequently, the ALJ found Plaintiff was not disabled 24 since July 30, 2018. AR 30. 25 VI. Analysis 26 In its prior November 2023 opinion, the ALJ found that during the period in 27 question, Plaintiff regularly presented with significant symptoms of schizoaffective 28 1 disorder as aggravated by regular use of methamphetamines and cocaine. It found 2 Plaintiff had marked limitations in interacting with others, in concentrating, 3 persisting, or maintaining pace, and in adapting or managing oneself. The ALJ then 4 found that when including Plaintiff’s substance abuse disorder, he met the criteria 5 of Section 12.03 of the Listings, but concluded if Plaintiff stopped using the illegal 6 drugs, he would not have an impairment or combination of impairments that would 7 meet any Listings. 8 After the case was remanded, the ALJ then found Plaintiff had only 9 moderate limitations in interacting with others, in concentrating, persisting, or 10 maintain pace, and in adapting or managing oneself, found Plaintiff did not have an 11 impairment or combination of impairments that meets or medically equals the 12 severity of any Listings, and found Plaintiff was not disabled. Because of these 13 findings, the ALJ was not required to conduct a drug addiction analysis (“DAA”).1 14 In its response, the Commissioner concedes the ALJ’s Step Three finding is 15 not supported by substantial evidence, but asks the Court to remand for further 16 administrative proceedings because it asserts there is evidence that Plaintiff 17 worked during the period of alleged disability. 18 The Commissioners’ request is not well-taken. First, the Court assumes the 19 ALJ reviewed the record and in doing so, found that Plaintiff had not engaged in 20

21 1 “An individual shall not be considered to be disabled ... if alcoholism or drug 22 addiction would ... be a contributing factor material to the Commissioner’s 23 determination that the individual is disabled.” 42 U.S.C. § 423(d)(2)(C). In cases 24 involving drug addiction and alcoholism (DAA), an ALJ must apply the five-step 25 sequential disability analysis twice. If the ALJ finds the claimant disabled during 26 the first five-step analysis, the ALJ must then consider whether the claimant would 27 be disabled if they stopped using drugs. If the DAA is a contributing factor 28 material to the determination of disability, the claimant is not disabled. 1 substantial gainful activity. The “work” identified by the Commission includes 2 simple side jobs completed for a close friend, who was allowing Plaintiff to live in 3 a shed on his property. This type of work does not provide any support to suggest 4 that Plaintiff could maintain a regular, full-time job. 5 Because the ALJ erred at Step Three2 and Plaintiff has not engaged in 6 substantial gainful activity, a remand for an immediate award of benefits is 7 appropriate. 8 Accordingly, IT IS HEREBY ORDERED: 9 1. For court management purposes, Plaintiff’s Opening Brief, ECF No. 10 16, is GRANTED. 11 2. For court management purposes, the Commissioner’s Brief, ECF No. 12 201, is DENIED. 13 3. The decision of the Commissioner is reversed and remanded for an 14 immediate award of benefits. 15 // 16 // 17 // 18 // 19 // 20 // 21

22 2 Substantial evidence in the record supports a finding that Plaintiff meets Listing 23 12.03, as well as a finding that Plaintiff’s drug addiction is not a contributing factor 24 material to the disability determination. See SSR 13.2P (“[A] record of multiple 25 hospitalizations, emergency department visits, or other treatment for the co- 26 occurring mental disorder—with or without treatment for DAA—is an indication 27 that DAA may not be material even if the claimant is discharged in improved 28 condition after each intervention.”). 1 4. Judgment shall be entered in favor of Plaintiff and against Defendant. IT IS SO ORDERED. The District Court Executive is hereby directed to 3|| file this Order, provide copies to counsel, and close the file. DATED this 23rd day of September 2025. 5

sin in far Stan Bastian 9 Chief United States District Judge 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 ORDER REVERSING THE DECISION OF COMMISSIONER ~ 9