Hudnall v. Dudek

Opinion

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS MAY 13 2025 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT

JOHN S. HUDNALL, No. 23-3727 D.C. No. Plaintiff - Appellant, 4:22-cv-02864-DMR v. ORDER LELAND DUDEK, Acting Commissioner of Social Security,

Defendant - Appellee.

Before: GRABER, FRIEDLAND, and BUMATAY, Circuit Judges.

The Memorandum Disposition filed on March 7, 2025, is withdrawn and

replaced with a new Memorandum Disposition filed concurrently with this order.

With this replacement, the petition for panel rehearing and the petition for

rehearing en banc are DENIED as moot. Further petitions may be filed. NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS MAY 13 2025 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT

JOHN S. HUDNALL, No. 23-3727 D.C. No. Plaintiff - Appellant, 4:22-cv-02864-DMR v. MEMORANDUM*

LELAND DUDEK, Acting Commissioner of Social Security,

Appeal from the United States District Court for the Northern District of California Donna M. Ryu, Chief Magistrate Judge, Presiding

Argued and Submitted November 19, 2024 San Jose, California

Before: GRABER, FRIEDLAND, and BUMATAY, Circuit Judges. Concurrence by Judge GRABER. Concurrence by Judge BUMATAY.

John Hudnall appeals the district court’s decision to grant summary judgment

in favor of the Commissioner of Social Security on his claim for disability benefits.

We have jurisdiction under 28 U.S.C. § 1291 and affirm.

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. We review “the district court’s order affirming the [administrative law judge’s

(“ALJs”)] denial of social security benefits de novo, and we will not overturn the

Commissioner’s decision ‘unless it is either not supported by substantial evidence

or is based upon legal error.’” Woods v. Kijakazi, 32 F.4th 785, 788 (9th Cir. 2022)

(citation omitted). In examining medical evidence, the most important factors for

an ALJ to consider are “supportability” and “consistency.” 20 C.F.R.

§ 404.1520c(a); see also Woods, 32 F.4th at 791–92.

1. Hudnall challenges the ALJ’s analysis of the medical evidence. First, he

claims that the ALJ erroneously discounted the opinion prepared by his marriage

and family therapist, Jana Klass, and signed by one of his physicians, Dr. Dana

Rosca. The opinion described Hudnall’s symptoms, including “difficulty staying on

task” and his self-description “as despondent.” The opinion concluded that Hudnall

was “unable to maintain work/career due to severe mood [symptoms] that impair

overall functionality.” The ALJ concluded that this opinion was unpersuasive, both

because it suggested that Hudnall’s condition showed “no improvement in five

years” even though he had not sought treatment during that time and because Klass

described Hudnall as a pathological liar in another record. The ALJ also faulted the

opinion for relying on Hudnall’s subjective reports.

Substantial evidence supports the ALJ’s conclusion. Although Hudnall

claimed that his disability began on March 1, 2015, the record shows that he sought

2 23-3727 little treatment between the initial treatment he received after his mental health

episode, ending in 2016, and when he applied for Social Security benefits in March

2020. The record further shows that Klass stated that Hudnall’s “lying seems to be

pathological and a form of self-preservation” and that much of Klass’s opinion was

based on Hudnall’s own descriptions of his condition. Finally, the record contains

numerous instances in which Hudnall’s symptoms were less severe than those

described in the opinion. So substantial evidence supports the ALJ’s decision to

discount that medical opinion.

Hudnall also challenges the ALJ’s decision to discount the opinions of two

doctors who treated him in Japan. The two physicians, Hiroyuki Ide and Yutaka

Minohara, opined that Hudnall suffered from major depressive disorder, struggled

with daily tasks, and could not work. The ALJ found those opinions unpersuasive

because they were inconsistent with other evidence in the record. Substantial

evidence supports that conclusion. The two physicians’ assessments, which are not

supported by treatment records, are inconsistent with the treatment notes of

Hudnall’s other medical providers. Further, Hudnall’s own description of his ability

to perform basic tasks contradicts their opinions because, for example, he stated that

he could “help [his] wife and kids with homework and childcare.”

2. Hudnall next asserts that the ALJ erred in finding his testimony inconsistent

with the medical record. “When a claimant presents objective evidence establishing

3 23-3727 an impairment ‘that could reasonably produce the symptoms of which she

complains, an adverse credibility finding must be based on clear and convincing

reasons’” that are supported with “substantial evidence in the record.” Smartt v.

Kijakazi, 53 F.4th 489, 497, 500 (9th Cir. 2022) (citation omitted). Here, the ALJ

explained that Hudnall’s statements were inconsistent with the record because he

had a gap in medical treatment and his allegations are not supported by his treating

sources’ mental status examinations. The ALJ discussed Hudnall’s treatment

history, including the fact that he improved after he received treatment following his

hospitalization in 2015 and that he improved again in 2020, when he resumed

treatment. The records showed that Hudnall displayed improving symptoms and

normal mental assessments. The ALJ also noted Hudnall’s record of dishonesty.

See Carmickle v. Comm’r, Soc. Sec. Admin., 533 F.3d 1155, 1161 (9th Cir. 2008)

(“Contradiction with the medical record is a sufficient basis for rejecting the

claimant’s subjective testimony.”). Substantial evidence thus supports the ALJ’s

decision to reject Hudnall’s testimony.

3. Hudnall contends that the ALJ erred in discounting a “function report”

prepared by his wife, Miyuki Sato, without explanation, because our precedent holds

that “competent lay witness testimony ‘cannot be disregarded without comment.’”

Molina v. Astrue, 674 F.3d 1104, 1114 (9th Cir. 2012) (quoting Nguyen v. Chater,

100 F.3d 1462, 1467 (9th Cir. 1996)). The Government argues, however, that under

4 23-3727 the Social Security Administration’s regulations promulgated in 2017, ALJs “are not

required to articulate how [they] considered evidence from nonmedical sources

using the requirements [that apply to medical opinions and prior administrative

medical findings].” 20 C.F.R § 404.1520c(d). In light of those revised regulations,

the Government argues, our court’s precedent requiring that an ALJ give a “germane

reason[]” for rejecting lay testimony should be overruled. Molina, 674 F.3d at 1114.

We need not decide whether those regulations constitute “intervening higher

authority” that is “clearly irreconcilable” with our precedent, because any error by

the ALJ in not giving a germane reason for rejecting Sato’s testimony was harmless.

Miller v. Gammie, 335 F.3d 889, 893 (9th Cir. 2003). Sato’s function report

provided substantially the same account of Hudnall’s symptoms as Hudnall did. As

explained above, the ALJ provided sufficient reasons for rejecting Hudnall’s

testimony as inconsistent with the record. Where the ALJ “has provided well-

supported grounds for rejecting testimony regarding specified limitations, we cannot

ignore the ALJ’s reasoning and reverse the agency merely because the ALJ did not

expressly discredit each witness who described the same limitations.” Molina, 674

F.3d at 1121. Because Hudnall’s wife’s lay witness testimony was substantially

similar to evidence that the ALJ appropriately rejected, “the ALJ’s failure to give

specific witness-by-witness reasons for rejecting the lay testimony did not alter the

ultimate nondisability determination.” Id. at 1122.

5 23-3727 4. Lastly, Hudnall contests the ALJ’s conclusion that he could perform the

occupations at “reasoning level 2” even though the ALJ found he “is precluded from

performing complex and detailed tasks but remains capable of performing short,

simple, repetitive tasks in a routine work environment.” Level two reasoning

requires an individual to be able “to carry out detailed but

uninvolved . . . instructions.” Dictionary of Occupational Titles, App. C. § III, 1991

WL 688702 (4th ed. 1991). The ALJ’s conclusion is consistent with this level of

reasoning. The ALJ found that Hudnall could not perform “complex and detailed

instructions,” which means that he could perform complex tasks that are not detailed

or detailed tasks that are not complex. This finding does not conflict with following

“detailed but uninvolved . . . instructions” as reasoning level 2 requires. See id. So

we discern no error here.1

AFFIRMED.

1 Hudnall explicitly disclaimed any argument that “short, simple, repetitive tasks” cannot be reconciled with reasoning level 2.

6 23-3727 FILED Hudnall v. Dudek, No. 23-3727 MAY 13 2025 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS Graber, Circuit Judge, concurring:

I join the memorandum disposition in full. I write separately to explain my

reading of the 2017 regulations.

The new regulations concerning the required analysis for medical sources

are not clearly irreconcilable with our precedent requiring that an ALJ give

“germane reasons” for rejecting lay testimony. Under those new regulations, ALJs

“are not required to articulate how [they] considered evidence from nonmedical

sources using the requirements [that apply to medical sources].” 20 C.F.R.

§§ 404.1520c(d), 416.920c(d) (emphasis added). This provision does not mean

that the ALJ need not articulate at all how nonmedical sources are assessed, a gap

that our precedents fill. See Nguyen v. Chater, 100 F.3d 1462, 1467 (9th Cir. 1996)

(“[L]ay witness testimony as to a claimant’s symptoms . . . cannot be disregarded

without comment.”). The regulations simply prescribe how an ALJ may articulate

reliance, or lack of reliance, on nonmedical sources—not in the detailed and

precise manner required for medical sources—but the regulations do not erase our

requirement that an ALJ must say something about such sources.

The “germane reasons” requirement is not onerous. Under 20 C.F.R.

§§ 404.1520c(d) and 416.920c(d), an ALJ need not follow the same rules that

apply to medical sources. It is sufficient for the ALJ to state, for example, that “the witnesses were not credible,” “the witnesses did not base their comments on

personal observation,” or “I find the medical testimony more persuasive.”

Judge Bumatay’s concurrence takes one final step that I would not take. The

fact that ALJs need not describe their analysis of nonmedical sources with the same

stringency as medical evidence does not mean that ALJs need not say anything

about nonmedical sources. Of course, the new regulations could have been written

so as to make them clearly irreconcilable with our “germane reasons” precedent,

but they were not. See Miller v. Gammie, 335 F.3d 889, 893 (9th Cir. 2003) (en

banc) (holding that a three-judge panel may overrule prior circuit authority that is

“clearly irreconcilable with the reasoning or theory of intervening higher

authority”). To the contrary, the new regulations list elsewhere the limited types of

evidence that do not require any analysis or explanation whatsoever. See 20 C.F.R.

§§ 404.1520b(c), 416.920b(c) (“Because the evidence listed in paragraphs ((c)(1)

through (c)(3) of this section is inherently neither valuable nor persuasive to the

issue of whether you are disabled or blind under the Act, we will not provide any

analysis about how we considered such evidence in our determination or

decision . . . .”). Tellingly, that list does not include lay testimony.

Judge Bumatay’s concurrence asserts that our “germane reasons” precedent

is invented and therefore illegitimate. J. Bumatay concurrence at 2–4. Even if that

assertion were correct, a three-judge panel cannot overrule this court’s precedent.

2 In my view, moreover, our “germane reasons” rule follows logically from our

statutory authority to review ALJs’ decisions. If ALJs did not have to set forth

their reasoning, it would be difficult, if not impossible, for us to conduct a full and

thorough review of their decisions when, for instance, a claimant presents

extensive evidence from family members and friends. See Stewart v. Sec’y of

Health, Educ., & Welfare,714 F.2d 287, 290 (3d Cir. 1983) (“We require that an

Administrative Law Judge do more than simply state ultimate factual

conclusions. . . . Additionally, we require from the ALJ ‘not only an expression of

the evidence s/he considered which supports the result, but also some indication of

the evidence which was rejected. In the absence of such an indication, the

reviewing court cannot tell if significant probative evidence was not credited or

simply ignored.’” (citations omitted)); Gober v. Matthews, 574 F.2d 772, 776 (3d

Cir. 1978) (“[A]s the Fourth Circuit has noted, ‘unless the Secretary has analyzed

all evidence and has sufficiently explained the weight he has given to obviously

probative exhibits, to say that his decision is supported by substantial evidence

approaches an abdication of the court’s duty to scrutinize the record as a whole to

determine whether the conclusions reached are rational.’” (quoting Arnold v. Sec’y

of Health, Educ. & Welfare, 567 F.2d 258, 259 (4th Cir. 1977)) (internal quotation

marks omitted)).

3 In sum, the new regulations concerning medical sources are not clearly

irreconcilable with our “germane reasons” precedent governing lay testimony.

Accordingly, that precedent still applies.

4 FILED MAY 13 2025 Hudnall v. Dudek, No. 23-3727 BUMATAY, Circuit Judge, concurring: MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS

For many years, our court has imposed a judge-made rule on administrative

law judges (“ALJs”) in Social Security proceedings: “If the ALJ wishes to discount

the testimony of the lay witnesses, he must give reasons that are germane to each

witness.” Dodrill v. Shalala, 12 F.3d 915, 919 (9th Cir. 1993). This rule was not

based on any statutory or regulatory requirement—in other words, we made it up.

But in 2017, the Social Security Administration revamped its regulations to

contradict our “germane reason” requirement. See 20 C.F.R. § 404.1520c(d).

Because of this regulatory change, we should have held that our “germane reasons”

requirement no longer applies to Social Security claims filed on or after March 27,

2017. See Revisions to Rules Regarding the Evaluation of Medical Evidence, 82

Fed. Reg. 5844, 5844 (Jan. 18, 2017). It’s a shame we backed off jettisoning this

improper rule.

I join the memorandum disposition except for its treatment of Hudnall’s claim

on non-medical sources.

I.

A.

Our precedent has required ALJs to give germane reasons for discounting the

testimony of lay witnesses. See Dodrill, 12 F.3d at 919. Under that precedent,

“competent lay witness testimony ‘cannot be disregarded without comment.’” 1 Molina v. Astrue, 674 F.3d 1104, 1114 (9th Cir. 2012) (simplified). Although we

have not required discussion of every witness “on a[n] individualized, witness-by-

witness basis,” to reject lay witness’s testimony, the ALJ must point to “germane

reasons” for doing so. Id.

But where did that rule come from? It turns out that this requirement is little

more than a judicial creation that is untethered from the regulations governing Social

Security proceedings—past or present. The “germane reasons” requirement traces

its origins to our decision in Dodrill. See 12 F.3d at 919. In that case, we considered

a case where the “ALJ acknowledged” testimony from lay witnesses, but

“appear[ed] to have discounted all of them because they were ‘based on the

claimant’s own assertions,’ and thus, ‘the conclusion that the claimant was not

credible requires that the testimony and affidavits be rejected.’” Id. at 918

(simplified). We explained that we’d previously held that “friends and family

members in a position to observe a claimant’s symptoms and daily activities are

competent to testify as to her condition.” Id. at 918–19 (citing Sprague v. Bowen,

812 F.2d 1226, 1232 (9th Cir. 1987)). We went on to emphasize the value of lay

witness testimony before announcing a new rule, without direct citation to any

authority: “[i]f the ALJ wishes to discount the testimony of the lay witnesses, he

must give reasons that are germane to each witness.” Id. at 919.

2 The closest Dodrill came to supporting this new concoction was through an

earlier citation to Sprague v. Bowen’s statement that “[d]isregard of this evidence

violates the Secretary’s regulation that he will consider observations by non-medical

sources as to how an impairment affects a claimant’s ability to work.” 812 F.2d at

1232 (citing 20 C.F.R. § 404.1513(e)(2) (1987)). But that citation fails to support

Dodrill’s “germane reasons” requirement. To start, at most, § 404.1513(e)(2) directs

ALJs to consider non-medical evidence presented by claimants. Back then,

§ 404.1513(e) simply stated that “[i]nformation from other sources may also help us

to understand how your impairment affects your ability to work,” with other sources

including “[o]bservations by non-medical sources.” 20 C.F.R. § 404.1513(e), (e)(2)

(1987). So even if ALJs must consider non-medical sources, there’s a big difference

between an obligation to consider evidence and an obligation to articulate how that

evidence was considered. Indeed, as we’ve recognized, an obligation to consider

evidence doesn’t necessarily equate to an obligation to explain that consideration.

See Molina, 674 F.3d at 1114 (“[T]here is a distinction between what an adjudicator

must consider and what the adjudicator must explain in the disability determination

or decision.” (simplified)). And nothing in the 1987 version of § 404.1513(e)(2)

(which remained the same when Dodrill was decided in 1993), mentions, much less

requires, ALJs to articulate how they considered non-medical evidence. So

Dodrill’s imposition of the “germane reasons” requirement is bereft of textual

3 support. Instead, what the opinion made clear is that the judges on the panel thought

non-medical evidence was important and that imposing the “germane reasons”

requirement was a good idea. See Dodrill, 12 F.3d at 919. Those might be good

reasons for the Commissioner of Social Security to adopt a new rule, but they aren’t

adequate reasons for this court to rewrite regulations.

Moreover, regardless of the “germane reasons” requirement’s shaky origins,

we should’ve concluded that it has been superseded by regulation. The Social

Security Administration promulgated new regulations in 2017, which apply to

claims filed on or after March 27, 2017. See 82 Fed. Reg. 5844 (Jan. 18, 2017).

Under the new regulations, nonmedical sources—including lay testimony from

friends and family—must be considered in determining the “consistency” of

“medical opinion(s) or prior administrative medical finding(s).” 20 C.F.R.

§ 404.1520c(c)(2); see id. § 404.1502(e) (defining “nonmedical source”). But under

the regulations, ALJs “are not required to articulate how [they] considered evidence

from nonmedical sources using the requirements in paragraph (a)–(c) in this

section.” Id. § 404.1520c(d). The “requirements in paragraph (a)–(c)” refer to ALJs’

responsibilities in considering medical sources.

First, paragraph (a) governs how ALJs “consider medical opinions and prior

administrative medical findings.” Id. § 404.1520c(a). It instructs ALJs to not “give

any specific evidentiary weight” to any medical opinions or prior administrative

4 medical findings. Id. Instead, it requires ALJs to consider the “supportability” and

“consistency” of the medical evidence as the “most important factors.” Id.

Second, paragraph (b) governs how ALJs “articulate [their] consideration of

medical opinions and prior administrative medical findings.” Id. § 404.1520c(b).

That provision requires ALJs to “articulate in [their] determination or decision how

persuasive [they] find all of the medical opinions and all of the prior administrative

medical findings” in the record. Id. It also specifies that ALJs need only articulate

how they considered multiple medical opinions or prior administrative medical

findings from one medical source “together in a single analysis” rather than

“articulate how [they] considered each medical opinion or prior administrative

medical finding from one medical source individually.” Id. § 404.1520c(b)(1). It

also expressly directs ALJs to “explain how [they] considered the supportability and

consistency factors for a medical source’s medical opinions or prior administrative

medical findings.” Id. § 404.1520c(b)(2). Finally, when ALJs find that two or more

medical sources “about the same issue” are “equally well-supported” and “consistent

with the record,” it requires ALJs to “articulate how [they] considered the other most

persuasive factors” in making their decision. Id. § 404.1520c(b)(3).

Third, paragraph (c) lists and describes the factors ALJs must consider when

evaluating medical sources. The factors include the “[s]upportability” of the medical

sources, the “[c]onsistency” of medical sources, the medical source’s “[r]elationship

5 with the claimant,” the “[s]pecialization” of the medical source, and “[o]ther factors

that tend to support or contradict” the medical sources. Id. § 404.1520c(c)(1)–(5).

Read in context, § 404.1520c(d) means that ALJs are not required to articulate

how they consider nonmedical sources as they are required to do for medical sources.

Unlike medical sources, ALJs don’t need to “articulate in [their] determination or

decision how persuasive [they] find” the nonmedical sources. Id. § 404.1520c(b).

Unlike medical sources, ALJs don’t need to “explain how [they] considered the

supportability and consistency factors” for nonmedical sources. Id.

§ 404.1520c(b)(2). Indeed, although ALJs have a duty to consider nonmedical

sources, nothing in § 404.1520c requires them to articulate how they considered the

nonmedical sources. Thus, as the Social Security Administration commented in

promulgating the new regulation, “aside from where [its] regulations elsewhere may

require an adjudicator to articulate how [the Administration] consider[s] evidence

from nonmedical sources, . . . there is no requirement for [the Administration] to

articulate how [the Administration] considered evidence from nonmedical sources

about an individual’s functional limitations and abilities using the rules in final

404.1520c[.]” 82 Fed. Reg. at 5855.

In contrast, the Social Security Administration’s new regulations also made

clear that the articulation requirement was different for claims predating March 27,

2017. See id. For those claims, the regulations governing nonmedical sources

6 provide that “[t]he adjudicator generally should explain the weight given to opinions

from [nonmedical] sources or otherwise ensure that the discussion of the evidence

in the determination or decision allows a claimant or subsequent reviewer to follow

the adjudicator’s reasoning, when such opinions may have an effect on the outcome

of the case.” 20 C.F.R. § 404.1527(f)(2). The change is clear. Unlike the regulations

governing claims filed on or after March 27, 2017, the regulations governing earlier

claims expressly adopt an articulation requirement for consideration of nonmedical

sources.

So § 404.1520c(d) exempts nonmedical sources from the requirement to

articulate how evidence is considered applicable to medical sources. Given

§ 404.1520c(d), our “germane reasons” precedent is now at odds with Social

Security regulations. Although our precedent demands explanation for the rejection

of each lay witness’s testimony, the governing regulations now expressly allow ALJs

to discount nonmedical evidence without any duty to explain. See Molina, 674 F.3d

at 1114 (recognizing that “there is a distinction between what an adjudicator must

consider and what the adjudicator must explain in the disability determination or

decision” (simplified)). Ordinarily, only an en banc court may overrule Ninth Circuit

precedent. See Miller v. Gammie, 335 F.3d 889, 892–93 (9th Cir. 2003) (en banc).

But that is not the case when our precedent’s “reasoning or theory . . . is clearly

irreconcilable with the reasoning or theory of intervening higher authority.” Woods

7 v. Kijakazi, 32 F.4th 785, 790 (9th Cir. 2022) (simplified). And amended Social

Security regulations may qualify as “intervening higher authority.” Id.

The new Social Security regulations dealing with the treatment of nonmedical

sources constitute an intervening higher authority. Under the Social Security Act,

“the Commissioner has wide latitude ‘to make rules and regulations and to establish

procedures . . . to carry out [the statutory] provisions,’ in particular regulations

governing ‘the nature and extent of the proofs and evidence . . . to establish the right

to benefits.’” Id. (quoting 42 U.S.C. § 405(a)); see also Bowen v. Yuckert, 482 U.S.

137, 145 (1987) (observing the Commissioner’s “exceptionally broad authority” to

promulgate evidentiary rules, which may be set aside only if they exceed the

agency’s statutory authority or are “arbitrary and capricious”). Because the new

regulations covering nonmedical evidence fall within the Commissioner’s broad

authority and nothing shows that they are “arbitrary and capricious,” they are the

new governing law.

The revised Social Security regulations are clearly irreconcilable with our

precedent requiring “germane reasons” to reject lay witness testimony. Thus, our

“germane reasons” precedent should no longer apply to claims filed on or after

March 27, 2017, and in considering such claims, ALJs shouldn’t need to explain

their reasons for discounting evidence from nonmedical sources, such as the

claimant’s friends and family.

8 B.

With the new governing framework in mind, the issue here is straightforward.

Hudnall’s wife provided a questionnaire describing his limitations. Although the

ALJ summarized her statement, Hudnall faults the ALJ for not providing reasons for

rejecting the limitations she described. Hudnall argues that it was reversible error to

fail to give germane reasons for rejecting this lay evidence. But because ALJs “are

not required to articulate how [they] considered evidence from nonmedical sources,”

20 C.F.R. § 404.1520c(d), the ALJ did not err in discounting the spousal evidence

without explanation. We should’ve taken this opportunity to recognize that our

“germane reasons” requirement no longer applies to claims filed on or after March

27, 2017.