1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 RENEE S., Case No.: 3:23-cv-00480-AHG 12 Plaintiff, ORDER:
13 v. (1) REQUIRING DEFENDANT TO 14 MARTIN O’MALLEY, Commissioner of FILE REGULAR STATUS REPORTS Social Security, BEGINNING ON SEPTEMBER 5, 15 2024; 16 Defendant. (2) REQUIRING PARTIES TO 17 JOINTLY FILE SUPPLEMENTAL 18 BRIEF REGARDING EAJA FEE ASSIGNMENT; 19
20 (3) DEFERRING RULING ON MOTION TO SUBSTITUTE PARTY 21 AND MOTION FOR EAJA FEES 22 [ECF Nos. 17, 20] 23
28 1 On June 13, 2024, the Court issued an order requiring the Social Security 2 Administration (“SSA”) to file a Response to the Motion to Substitute Party (ECF No. 17) 3 filed on behalf of Plaintiff’s widower Patrick S., who seeks to be substituted as the Plaintiff 4 in this case pursuant to Fed. R. Civ. P. 25(a). See ECF No. 18. 5 In that Order, the Court explained that, before it could find that Patrick S. is the 6 proper party to be substituted for Plaintiff in this case, it would need to determine whether: 7 (1) the motion is timely; (2) the claims pled in the case have been extinguished; and (3) the 8 person being substituted is a proper party. Maseda v. Saul, Case No. 1:20-cv-01657, 2021 9 WL 2268871, at *1 (E.D. Cal. June 3, 2021). See also Fed. R. Civ. P. 25(a)(1). Although 10 it is clear that the motion is timely, the determination of the other two prongs of the analysis 11 required more information from the agency. That is, the Court could not determine from 12 the record whether the SSA had yet calculated the disability insurance benefits due to be 13 awarded to Plaintiff pursuant to the Court’s judgment in this case, nor did the record reflect 14 whether the SSA had yet determined whether Patrick S. is the appropriate qualifying 15 relative under the regulations entitled to receive the benefits owed to Plaintiff. See ECF 16 No. 18 at 3-5.1 Therefore, the Court ordered the SSA to file a Response to the Motion to 17 Substitute Party to address the following questions: 18 (1) whether the agency has taken any action on the Notice Regarding Substitution of 19 Party upon Death of Claimant filed with the Social Security Administration 20 Office of Hearings and Appeals on May 5, 2024 (ECF No. 17-4), along with a 21 description of any such action; 22 (2) whether the agency agrees that Patrick S. is a qualifying relative eligible to 23 receive the benefits owed to Plaintiff under the relevant regulations; 24 25 1 The Court also noted that it anticipated Plaintiff’s counsel may seek to recover attorney 26 fees under the Equal Access to Justice Act (“EAJA”) in this case, which might be properly 27 payable to Plaintiff’s surviving spouse if he is substituted as the Plaintiff under Rule 25(a). ECF No. 18 at 4. The parties have since jointly filed the anticipated EAJA fee motion on 28 1 (3) whether any calculation and award of benefits has yet been made at the agency 2 level; and 3 (4) the agency’s position on whether Plaintiff’s claims in this Court have been 4 extinguished. 5 Id. at 5-6. 6 Counsel for the SSA filed a Response and supporting Declaration on July 23, 2024. 7 ECF Nos. 26, 27. The Response makes little headway in providing the information the 8 Court needs to determine the propriety of permitting Plaintiff’s surviving spouse to be 9 substituted as the Plaintiff in this case under Rule 25(a). Specifically, the agency reports 10 that it processed the Court’s judgment in this case and sent a notice of award to the last 11 known address of the claimant on July 6, 2024, along with the SSA-1724 form for “Claims 12 for Amounts due in the case of a deceased beneficiary,” requesting proof of certificates to 13 verify Patrick S.’s widower status. ECF No. 26 at 2. The agency has not yet made a 14 determination regarding whether Patrick S. is a qualifying relative eligible to receive the 15 benefits owed to Plaintiff. Id. Further, the agency does not take a clear position on whether 16 Plaintiff’s claims in this Court have been extinguished, other than noting that neither 17 Plaintiff nor any beneficiary is entitled to be paid benefits after the date of Plaintiff’s death, 18 and whether the past-due benefit award can be paid to an appropriate substitute party cannot 19 be determined until the agency has completed its own process. Id. 20 Because the award of past-due benefits ordered by this Court has not yet been paid 21 to any eligible surviving relative of Plaintiff as provided for in the regulations, and because 22 the parties’ Joint Motion for EAJA Fees (which fees may be payable to Plaintiff’s surviving 23 spouse if he is permitted to substitute under Rule 25(a)) is now pending, the Court finds 24 the claims pled in this case have not yet been extinguished and that substitution of the 25 proper party in Plaintiff’s stead is appropriate. 26 However, at this juncture, the Court is not prepared to determine whether Patrick S. 27 is a proper party to substitute as Plaintiff under Rule 25(a). As discussed in the Court’s 28 prior Order, the benefits that may still be due to Plaintiff based on the Court’s ruling in this 1 case are payable to the living person (or persons) listed in highest priority as set forth in 20 2 C.F.R. § 404.503(b). A deceased claimant’s surviving spouse has the highest order of 3 priority for receipt of underpayments under that regulation if he was either (i) living in the 4 same household with the claimant at the time of her death; or (ii) entitled to a monthly 5 benefit on the basis of the same earnings record as was the deceased individual for the 6 month in which such individual died. 20 C.F.R. § 404.503(b)(1)(i)-(ii). Pursuant to the 7 Court’s prior Order, Patrick S. filed a supplemental Declaration on June 17, 2024 stating 8 that he and Plaintiff have always resided in the same household since they were married 9 on February 3, 1996, and that he was living in the same household with her at the time of 10 her death. ECF No. 19. Therefore, from the evidence before the Court, it appears that 11 Parrick S. will be deemed a qualifying surviving relative eligible to receive the award of 12 Plaintiff’s past-due benefits. However, 20 C.F.R. § 404.503 is the implementing regulation 13 of 42 U.S.C. § 404(d). See Iannaccone v. L., 142 F.3d 553, 559 (2d Cir. 1998). In the 14 federal statute, Congress has specified that, if an individual dies before any payment of 15 disability insurance benefits due to her is completed, payment of the amount due shall be 16 made “to the person, if any, who is determined by the Commissioner of Social Security to 17 be the surviving spouse of the deceased individual. . . .” 42 U.S.C. § 404(d)(1) (emphasis 18 added). Therefore, from the plain language of the statute, Congress has reserved to the 19 Commissioner the determination of the eligibility of a surviving spouse to receive a 20 deceased claimant’s past-due benefits. Here, the agency has not yet made an official 21 determination regarding whether Patrick S. is a qualifying relative eligible to receive the 22 benefits award issued to Plaintiff, and the agency does not otherwise indicate in its response 23 that it concedes to the granting of the Motion to Substitute Patrick S. as Plaintiff in this 24 case. ECF No. 24.
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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 RENEE S., Case No.: 3:23-cv-00480-AHG 12 Plaintiff, ORDER:
13 v. (1) REQUIRING DEFENDANT TO 14 MARTIN O’MALLEY, Commissioner of FILE REGULAR STATUS REPORTS Social Security, BEGINNING ON SEPTEMBER 5, 15 2024; 16 Defendant. (2) REQUIRING PARTIES TO 17 JOINTLY FILE SUPPLEMENTAL 18 BRIEF REGARDING EAJA FEE ASSIGNMENT; 19
20 (3) DEFERRING RULING ON MOTION TO SUBSTITUTE PARTY 21 AND MOTION FOR EAJA FEES 22 [ECF Nos. 17, 20] 23
28 1 On June 13, 2024, the Court issued an order requiring the Social Security 2 Administration (“SSA”) to file a Response to the Motion to Substitute Party (ECF No. 17) 3 filed on behalf of Plaintiff’s widower Patrick S., who seeks to be substituted as the Plaintiff 4 in this case pursuant to Fed. R. Civ. P. 25(a). See ECF No. 18. 5 In that Order, the Court explained that, before it could find that Patrick S. is the 6 proper party to be substituted for Plaintiff in this case, it would need to determine whether: 7 (1) the motion is timely; (2) the claims pled in the case have been extinguished; and (3) the 8 person being substituted is a proper party. Maseda v. Saul, Case No. 1:20-cv-01657, 2021 9 WL 2268871, at *1 (E.D. Cal. June 3, 2021). See also Fed. R. Civ. P. 25(a)(1). Although 10 it is clear that the motion is timely, the determination of the other two prongs of the analysis 11 required more information from the agency. That is, the Court could not determine from 12 the record whether the SSA had yet calculated the disability insurance benefits due to be 13 awarded to Plaintiff pursuant to the Court’s judgment in this case, nor did the record reflect 14 whether the SSA had yet determined whether Patrick S. is the appropriate qualifying 15 relative under the regulations entitled to receive the benefits owed to Plaintiff. See ECF 16 No. 18 at 3-5.1 Therefore, the Court ordered the SSA to file a Response to the Motion to 17 Substitute Party to address the following questions: 18 (1) whether the agency has taken any action on the Notice Regarding Substitution of 19 Party upon Death of Claimant filed with the Social Security Administration 20 Office of Hearings and Appeals on May 5, 2024 (ECF No. 17-4), along with a 21 description of any such action; 22 (2) whether the agency agrees that Patrick S. is a qualifying relative eligible to 23 receive the benefits owed to Plaintiff under the relevant regulations; 24 25 1 The Court also noted that it anticipated Plaintiff’s counsel may seek to recover attorney 26 fees under the Equal Access to Justice Act (“EAJA”) in this case, which might be properly 27 payable to Plaintiff’s surviving spouse if he is substituted as the Plaintiff under Rule 25(a). ECF No. 18 at 4. The parties have since jointly filed the anticipated EAJA fee motion on 28 1 (3) whether any calculation and award of benefits has yet been made at the agency 2 level; and 3 (4) the agency’s position on whether Plaintiff’s claims in this Court have been 4 extinguished. 5 Id. at 5-6. 6 Counsel for the SSA filed a Response and supporting Declaration on July 23, 2024. 7 ECF Nos. 26, 27. The Response makes little headway in providing the information the 8 Court needs to determine the propriety of permitting Plaintiff’s surviving spouse to be 9 substituted as the Plaintiff in this case under Rule 25(a). Specifically, the agency reports 10 that it processed the Court’s judgment in this case and sent a notice of award to the last 11 known address of the claimant on July 6, 2024, along with the SSA-1724 form for “Claims 12 for Amounts due in the case of a deceased beneficiary,” requesting proof of certificates to 13 verify Patrick S.’s widower status. ECF No. 26 at 2. The agency has not yet made a 14 determination regarding whether Patrick S. is a qualifying relative eligible to receive the 15 benefits owed to Plaintiff. Id. Further, the agency does not take a clear position on whether 16 Plaintiff’s claims in this Court have been extinguished, other than noting that neither 17 Plaintiff nor any beneficiary is entitled to be paid benefits after the date of Plaintiff’s death, 18 and whether the past-due benefit award can be paid to an appropriate substitute party cannot 19 be determined until the agency has completed its own process. Id. 20 Because the award of past-due benefits ordered by this Court has not yet been paid 21 to any eligible surviving relative of Plaintiff as provided for in the regulations, and because 22 the parties’ Joint Motion for EAJA Fees (which fees may be payable to Plaintiff’s surviving 23 spouse if he is permitted to substitute under Rule 25(a)) is now pending, the Court finds 24 the claims pled in this case have not yet been extinguished and that substitution of the 25 proper party in Plaintiff’s stead is appropriate. 26 However, at this juncture, the Court is not prepared to determine whether Patrick S. 27 is a proper party to substitute as Plaintiff under Rule 25(a). As discussed in the Court’s 28 prior Order, the benefits that may still be due to Plaintiff based on the Court’s ruling in this 1 case are payable to the living person (or persons) listed in highest priority as set forth in 20 2 C.F.R. § 404.503(b). A deceased claimant’s surviving spouse has the highest order of 3 priority for receipt of underpayments under that regulation if he was either (i) living in the 4 same household with the claimant at the time of her death; or (ii) entitled to a monthly 5 benefit on the basis of the same earnings record as was the deceased individual for the 6 month in which such individual died. 20 C.F.R. § 404.503(b)(1)(i)-(ii). Pursuant to the 7 Court’s prior Order, Patrick S. filed a supplemental Declaration on June 17, 2024 stating 8 that he and Plaintiff have always resided in the same household since they were married 9 on February 3, 1996, and that he was living in the same household with her at the time of 10 her death. ECF No. 19. Therefore, from the evidence before the Court, it appears that 11 Parrick S. will be deemed a qualifying surviving relative eligible to receive the award of 12 Plaintiff’s past-due benefits. However, 20 C.F.R. § 404.503 is the implementing regulation 13 of 42 U.S.C. § 404(d). See Iannaccone v. L., 142 F.3d 553, 559 (2d Cir. 1998). In the 14 federal statute, Congress has specified that, if an individual dies before any payment of 15 disability insurance benefits due to her is completed, payment of the amount due shall be 16 made “to the person, if any, who is determined by the Commissioner of Social Security to 17 be the surviving spouse of the deceased individual. . . .” 42 U.S.C. § 404(d)(1) (emphasis 18 added). Therefore, from the plain language of the statute, Congress has reserved to the 19 Commissioner the determination of the eligibility of a surviving spouse to receive a 20 deceased claimant’s past-due benefits. Here, the agency has not yet made an official 21 determination regarding whether Patrick S. is a qualifying relative eligible to receive the 22 benefits award issued to Plaintiff, and the agency does not otherwise indicate in its response 23 that it concedes to the granting of the Motion to Substitute Patrick S. as Plaintiff in this 24 case. ECF No. 24. Therefore, the Court is reticent to grant the Motion to Substitute prior 25 to the agency’s completion of its own process to determine Patrick S.’s eligibility to receive 26 the benefit award, at the risk of issuing a ruling that is inconsistent with the agency’s later 27 determination. 28 Accordingly, Defendant is ORDERED to file status updates every 30 days 1 regarding the agency’s determination of Patrick S.’s eligibility to receive Plaintiff’s benefit 2 award. The first such update shall be due by September 5, 2024. 3 Further, the Court does not yet have sufficient information to rule on the pending 4 Motion for EAJA Fees (ECF No. 20). As an initial matter, EAJA fees are properly payable 5 to Plaintiff as the prevailing party, not to Plaintiff’s attorneys. Astrue v. Ratliff, 560 U.S. 6 586, 588-59 (2010). Nonetheless, “district courts have recognized that Ratliff does not 7 prevent payment of a fee award directly to the attorney where there has been a valid 8 assignment and the plaintiff does not owe a debt to the government.” Ulugalu v. Berryhill, 9 No. 17cv1087-GPC-JLB, 2018 WL 2012330, at *4–5 (S.D. Cal. Apr. 30, 2018) (reviewing 10 Plaintiff’s assignment agreement and ordering that the EAJA fees be paid to plaintiff’s 11 counsel, subject to any administrative offset due to outstanding federal debt). In the Court’s 12 prior Order, the Court noted that counsel for both sides should meet and confer regarding 13 whether an EAJA fee award is appropriately payable to Plaintiff’s surviving spouse if he 14 is permitted to proceed as the plaintiff in this action, because any assignment agreement 15 entered into between Plaintiff and her attorneys before her death will not necessarily bind 16 her husband. See ECF No. 18 at 5 n.3. However, the parties fail to address this issue in the 17 Joint Motion for EAJA Fees, instead relying on Plaintiff’s assignment agreement with her 18 attorneys without any mention of her death and the pending request that Patrick S. be 19 substituted as the plaintiff. See generally ECF No. 20. 20 Counsel for both sides are ORDERED to file a joint supplemental brief in support 21 of the Motion for EAJA Fees no later than August 20, 2024 that addresses whether, if 22 Patrick S. is substituted as the Plaintiff in this action under Rule 25(a), EAJA fees are 23 properly payable directly to Plaintiff’s attorneys if the Government determines they are not 24 subject to any offset, and the effect, if any, of Plaintiff’s death on the enforceability of the 25 assignment agreement. 26 The Court will DEFER ruling on the Motion to Substitute Party (ECF No. 17) and 27 the Joint Motion for EAJA Fees (ECF No. 20) until after the issue of Patrick S.’s eligibility 28 to receive Plaintiff’s benefits award is resolved at the agency level and the parties have 1 || filed their supplemental brief on the Joint Motion for EAJA Fees. 2 IT IS SO ORDERED. 3 ||Dated: August 6, 2024 A DS H. | | b 4 Honorable Allison H. Goddard 5 United States Magistrate Judge 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28