Lopez v. Heckler

572 F. Supp. 26, 37 Fed. R. Serv. 2d 1284
CourtDistrict Court, C.D. California
DecidedJune 16, 1983
DocketCiv. 83-0697-WPG(T)
StatusPublished
Cited by37 cases

This text of 572 F. Supp. 26 (Lopez v. Heckler) is published on Counsel Stack Legal Research, covering District Court, C.D. California primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lopez v. Heckler, 572 F. Supp. 26, 37 Fed. R. Serv. 2d 1284 (C.D. Cal. 1983).

Opinion

MEMORANDUM OF DECISION

WILLIAM P. GRAY, District Judge.

This is a proposed class action against the Secretary of Health and Human Services and the Commissioner of the Social Security Administration, challenging procedures used in terminating Social Security disability benefits. 1 The plaintiffs are twenty assertedly disabled individuals and fourteen organizations, the former bringing suit on behalf of themselves and those similarly situated. Eighteen of the plaintiffs also seek to have the terminations of their individual benefits reversed pursuant to 42 U.S.C. § 405(g). The plaintiffs have filed motions for vacation of reference to the magistrate, class certification and prelimi *28 nary injunction; the defendants have filed a motion to dismiss for lack of jurisdiction. The defendants’ motion is denied and the plaintiffs’ motions are granted, as set forth in the terms of the order filed with this memorandum.

Beginning in March 1981, the Social Security Administration (SSA) noticeably accelerated the rate at which it reviews the disability status of those receiving disability benefits. In the calendar year 1980,185,639 Continuing Disability Investigations (CDIs) were conducted; 2 in the fiscal year 1982, 435,262 CDIs were conducted. 3 It would appear that the acceleration of the review process resulted in a dramatic increase in terminations. In fiscal year 1982, 195,474 beneficiaries were removed from the disability rolls, as compared with 98,800 terminated in fiscal year 1981. 4

In two recent opinions, the Court of Appeals of this circuit held that before disability benefits may be terminated for lack of disability, the Secretary must produce evidence showing improvement in the recipient’s medical condition. Patti v. Schweiker, 669 F.2d 582 (9th Cir.1982) 5 and Finnegan v. Matthews, 641 F.2d 1340 (9th Cir.1981). 6 The Secretary has announced that she “does not acquiesce” in these decisions and has issued rulings to her subordinates, including administrative law judges, directing them not to act in accordance with these precedents. 7

The plaintiffs challenge the constitutionality of the Secretary’s policy of nonacquiescence on the grounds that it violates the principles of Separation of Powers and stare decisis, as well as the plaintiffs’ right to due process. The Government denies that the policy of nonacquiescence is illegal and contends that the effect of the nonacquiescence rulings is merely to preserve the Secretary’s right to ask the courts of ap *29 peals, and possibly the Supreme Court, to overrule decisions like Patti and Finnegan in appropriate cases.

This court notes that this litigation involves more than 42 U.S.C. § 405(g) claims and is a class action in which injunctive relief is requested. Since 28 U.S.C. § 636 does not empower magistrates to determine pretrial matters with respect to such actions, and since the parties agree that vacation of reference to the magistrate should be granted for the purpose of these motions, the vacation will be ordered.

With respect to the defendants’ motion to dismiss for lack of jurisdiction, the court finds that this case fits within the exception to the exhaustion of administrative remedies requirement enunciated in Weinberger et a1. v. Salfi et al., 422 U.S. 749, 95 S.Ct. 2457, 45 L.Ed.2d 522 (1975). There, the Supreme Court ruled that the three-judge district court did have jurisdiction to consider a constitutional challenge by some plaintiffs to certain Social Security eligibility requirements. Those plaintiffs had not exhausted the administrative processes by taking their grievances to an administrative law judge or the SSA’s Appeals Council. The Court noted that formal exhaustion was not required there because the purposes of exhaustion — to prevent premature interference with agency processes and to provide the agency an opportunity to correct its own errors — had been served, once the Secretary “has satisfied himself that the only issue is the constitutionality of a statutory requirement, a matter which is beyond his jurisdiction to determine .... ” Id. at 765, 95 S.Ct. at 2467.

The Ninth Circuit Court of Appeals has noted that where a ruling by the Secretary, while “nominally leaving the administrative review process open for claims ...,” in effect makes the result of that process “both pre-ordained and immutable,” the Salfi exception applies. Ringer et al. v. Schweiker, 697 F.2d 1291, 1295 (9th Cir. 1982). The court noted that such a ruling “not only makes appeals futile ...,” but also “indicates that the Secretary believes appeals are worthless to the Agency as well as to the claimant.” Id. at 1295-6.

Here, in view of the Secretary’s attitude, clearly enunciated in her ruling directing administrative law judges and the Appeals Council to ignore Patti and Finnegan, and not to apply a medical improvement standard in disability termination cases, appeals would indeed be futile. Thus, exhaustion of remedies would serve no useful purpose in this instance. Under the authority of Salfi, supra, and Ringer, supra, the defendants’ motion to dismiss will be denied.

Regarding the plaintiffs’ motions for class certification and for a preliminary injunction, the issues raised are inextricably intertwined with each other and with the merits of the plaintiffs’ constitutional challenge. Our Court of Appeals has stated that to obtain a preliminary injunction the moving party must demonstrate “either a combination of probable success on the merits and the possibility of irreparable injury, or that serious questions are raised and the balance of hardships tips sharply in the moving party’s favor.” Beltran et al. v. Meyers et al., 677 F.2d 1317, 1320 (9th Cir. 1982) (emphasis in original). The plaintiffs have fulfilled both tests.

As to the first test, they have demonstrated probable success on the merits by making a strong argument that agencies are bound by the laws of the circuit. “It is emphatically the province and duty of the judicial department to say what the law is.

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Bluebook (online)
572 F. Supp. 26, 37 Fed. R. Serv. 2d 1284, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lopez-v-heckler-cacd-1983.