1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 11 WILLIAM S.,1 Case No. 2:19-cv-02093-MAA 12 Plaintiff, MEMORANDUM DECISION AND 13 v. ORDER REVERSING DECISION OF THE COMMISSIONER AND 14 REMANDING FOR FURTHER 15 ANDREW M. SAUL,2 ADMINISTRATIVE PROCEEDINGS Commissioner of Social Security, 16 Defendant. 17 18 19 On March 20, 2019, Plaintiff filed a Complaint seeking review of the Social 20 Security Commissioner’s final decision denying his applications for childhood 21 disability benefits and supplemental security income pursuant to Titles II and XVI 22 of the Social Security Act. This matter is fully briefed and ready for decision. For 23 the reasons discussed below, the Commissioner’s final decision is reversed, and this 24 action is remanded for further administrative proceedings.
25 1 Plaintiff’s name is partially redacted in accordance with Federal Rule of Civil Procedure 5.2(c)(2)(B) and the recommendation of the Committee on Court 26 Administration and Case Management of the Judicial Conference of the United States. 27 2 The Commissioner of Social Security is substituted as the Defendant pursuant to 28 Federal Rule of Civil Procedure 25(d). 1 PROCEDURAL HISTORY 2 Plaintiff was born on December 20, 1996. (Administrative Record [AR] 41, 3 96.) On July 16, 2015, Plaintiff protectively filed applications for childhood 4 disability benefits (based on the earnings record of his father) and supplemental 5 security income, alleging disability beginning on November 15, 2001. (AR 18, 96, 6 120.) Plaintiff alleged disability because of autism and learning disabilities. (AR 7 96, 120.) After his applications were denied initially and on reconsideration, 8 Plaintiff requested a hearing before an Administrative Law Judge (“ALJ”). (AR 18, 9 157.) At a hearing held on September 21, 2017, at which Plaintiff appeared with 10 counsel, the ALJ heard testimony from Plaintiff, two lay witnesses, and a 11 vocational expert. (AR 35-95.) 12 In a decision issued on January 16, 2018, the ALJ denied Plaintiff’s 13 application after making the following findings pursuant to the Commissioner’s 14 five-step evaluation. (AR 18-25.) Plaintiff had not engaged in substantial gainful 15 activity since his alleged disability onset date of November 15, 2001. (AR 20.) He 16 had a severe impairment consisting of autism spectrum disorder. (Id.) He did not 17 have an impairment or combination of impairments that met or medically equaled 18 the requirements of one of the impairments from the Commissioner’s Listing of 19 Impairments. (AR 20-21.) He had a residual functional capacity (“RFC”) for work 20 “at all exertional levels but with the following nonexertional limitations: occasional 21 contact with supervisors, public, and coworkers.” (AR 21.) He had no past 22 relevant work. (AR 24.) He could perform work existing in significant numbers in 23 the national economy, in the occupations of hand packer, vegetable packer, and 24 store laborer. (AR 25.) Accordingly, the ALJ concluded that Plaintiff was not 25 disabled as defined by the Social Security Act. (Id.) 26 On February 15, 2019, the Appeals Council denied Plaintiff’s request for 27 review. (AR 1-6.) Thus, ALJ’s decision became the final decision of the 28 Commissioner. 1 DISPUTED ISSUES 2 The parties raise the following disputed issues: 3 1. Whether the ALJ improperly assessed and rejected the opinions of 4 Plaintiff’s treating, examining, and non-examining medical sources; 5 2. Whether the ALJ issued an incomplete residual functional capacity 6 finding that is not supported by substantial evidence which resulted in invalid 7 testimony from the vocational expert upon which to support the step five finding; 8 and 9 3. Whether the ALJ improperly discredited the oral testimony of Plaintiff 10 and the oral and written testimony of the third party witnesses. 11 (ECF No. 17, Parties’ Joint Stipulation [“Joint Stip.”] at 2-3.) 12 13 STANDARD OF REVIEW 14 Under 42 U.S.C. § 405(g), the Court reviews the Commissioner’s final 15 decision to determine whether the Commissioner’s findings are supported by 16 substantial evidence and whether the proper legal standards were applied. See 17 Treichler v. Commissioner of Social Sec. Admin., 775 F.3d 1090, 1098 (9th Cir. 18 2014). Substantial evidence means “more than a mere scintilla” but less than a 19 preponderance. See Richardson v. Perales, 402 U.S. 389, 401 (1971); Lingenfelter 20 v. Astrue, 504 F.3d 1028, 1035 (9th Cir. 2007). Substantial evidence is “such 21 relevant evidence as a reasonable mind might accept as adequate to support a 22 conclusion.” Richardson, 402 U.S. at 401. The Court must review the record as a 23 whole, weighing both the evidence that supports and the evidence that detracts from 24 the Commissioner’s conclusion. Lingenfelter, 504 F.3d at 1035. Where evidence is 25 susceptible of more than one rational interpretation, the Commissioner’s 26 interpretation must be upheld. See Orn v. Astrue, 495 F.3d 625, 630 (9th Cir. 27 2007). 28 /// 1 DISCUSSION 2 For the reasons discussed below, reversal and remand for further 3 administrative proceedings are warranted for arguments raised in Issues One and 4 Three, based on the ALJ’s assessment of a non-examining physician’s opinion and 5 a lay witness’s testimony. Thus, the Court declines to address Plaintiff’s remaining 6 arguments. See Hiler v. Astrue, 687 F.3d 1208, 1212 (9th Cir. 2012) (“Because we 7 remand the case to the ALJ for the reasons stated, we decline to reach [plaintiff’s] 8 alternative ground for remand.”); see also Augustine ex rel. Ramirez v. Astrue, 536 9 F. Supp. 2d 1147, 1153 n.7 (C.D. Cal. 2008) (“[The] Court need not address the 10 other claims plaintiff raises, none of which would provide plaintiff with any further 11 relief than granted, and all of which can be addressed on remand.”). 12 13 I. Non-Examining Physician’s Opinion (Issue One). 14 In Issue One, one of Plaintiff’s arguments is that the ALJ failed to consider 15 the opinion of Dr. Kresser, a non-examining, state agency psychologist. (Joint Stip. 16 at 12-13.) 17 18 A. Legal Standard. 19 The Commissioner’s regulations require that “[r]egardless of its source, we 20 will evaluate every medical opinion we received.” 20 C.F.R. §§ 404.1527(c) 21 (2017), 416.927(c) (2017). ALJs “must consider” evidence from State agency 22 medical or psychological consultants. 20 C.F.R. §§ 404.1513a, 416.913a. ALJs 23 “are not bound by findings made by State agency or other program physicians and 24 psychologists, but they may not ignore these opinions and must explain the weight 25 given to these opinions in their decisions.” Social Security Ruling (“SSR”) 96-6P, 26 1996 WL 374180, at *1. An ALJ “may reject the opinion of a non-examining 27 physician by reference to specific evidence in the medical record.” Sousa v. 28 Callahan, 143 F.3d 1240, 1244 (9th Cir. 1998). 1 B. Analysis. 2 After reviewing Plaintiff’s medical record, Dr.
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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 11 WILLIAM S.,1 Case No. 2:19-cv-02093-MAA 12 Plaintiff, MEMORANDUM DECISION AND 13 v. ORDER REVERSING DECISION OF THE COMMISSIONER AND 14 REMANDING FOR FURTHER 15 ANDREW M. SAUL,2 ADMINISTRATIVE PROCEEDINGS Commissioner of Social Security, 16 Defendant. 17 18 19 On March 20, 2019, Plaintiff filed a Complaint seeking review of the Social 20 Security Commissioner’s final decision denying his applications for childhood 21 disability benefits and supplemental security income pursuant to Titles II and XVI 22 of the Social Security Act. This matter is fully briefed and ready for decision. For 23 the reasons discussed below, the Commissioner’s final decision is reversed, and this 24 action is remanded for further administrative proceedings.
25 1 Plaintiff’s name is partially redacted in accordance with Federal Rule of Civil Procedure 5.2(c)(2)(B) and the recommendation of the Committee on Court 26 Administration and Case Management of the Judicial Conference of the United States. 27 2 The Commissioner of Social Security is substituted as the Defendant pursuant to 28 Federal Rule of Civil Procedure 25(d). 1 PROCEDURAL HISTORY 2 Plaintiff was born on December 20, 1996. (Administrative Record [AR] 41, 3 96.) On July 16, 2015, Plaintiff protectively filed applications for childhood 4 disability benefits (based on the earnings record of his father) and supplemental 5 security income, alleging disability beginning on November 15, 2001. (AR 18, 96, 6 120.) Plaintiff alleged disability because of autism and learning disabilities. (AR 7 96, 120.) After his applications were denied initially and on reconsideration, 8 Plaintiff requested a hearing before an Administrative Law Judge (“ALJ”). (AR 18, 9 157.) At a hearing held on September 21, 2017, at which Plaintiff appeared with 10 counsel, the ALJ heard testimony from Plaintiff, two lay witnesses, and a 11 vocational expert. (AR 35-95.) 12 In a decision issued on January 16, 2018, the ALJ denied Plaintiff’s 13 application after making the following findings pursuant to the Commissioner’s 14 five-step evaluation. (AR 18-25.) Plaintiff had not engaged in substantial gainful 15 activity since his alleged disability onset date of November 15, 2001. (AR 20.) He 16 had a severe impairment consisting of autism spectrum disorder. (Id.) He did not 17 have an impairment or combination of impairments that met or medically equaled 18 the requirements of one of the impairments from the Commissioner’s Listing of 19 Impairments. (AR 20-21.) He had a residual functional capacity (“RFC”) for work 20 “at all exertional levels but with the following nonexertional limitations: occasional 21 contact with supervisors, public, and coworkers.” (AR 21.) He had no past 22 relevant work. (AR 24.) He could perform work existing in significant numbers in 23 the national economy, in the occupations of hand packer, vegetable packer, and 24 store laborer. (AR 25.) Accordingly, the ALJ concluded that Plaintiff was not 25 disabled as defined by the Social Security Act. (Id.) 26 On February 15, 2019, the Appeals Council denied Plaintiff’s request for 27 review. (AR 1-6.) Thus, ALJ’s decision became the final decision of the 28 Commissioner. 1 DISPUTED ISSUES 2 The parties raise the following disputed issues: 3 1. Whether the ALJ improperly assessed and rejected the opinions of 4 Plaintiff’s treating, examining, and non-examining medical sources; 5 2. Whether the ALJ issued an incomplete residual functional capacity 6 finding that is not supported by substantial evidence which resulted in invalid 7 testimony from the vocational expert upon which to support the step five finding; 8 and 9 3. Whether the ALJ improperly discredited the oral testimony of Plaintiff 10 and the oral and written testimony of the third party witnesses. 11 (ECF No. 17, Parties’ Joint Stipulation [“Joint Stip.”] at 2-3.) 12 13 STANDARD OF REVIEW 14 Under 42 U.S.C. § 405(g), the Court reviews the Commissioner’s final 15 decision to determine whether the Commissioner’s findings are supported by 16 substantial evidence and whether the proper legal standards were applied. See 17 Treichler v. Commissioner of Social Sec. Admin., 775 F.3d 1090, 1098 (9th Cir. 18 2014). Substantial evidence means “more than a mere scintilla” but less than a 19 preponderance. See Richardson v. Perales, 402 U.S. 389, 401 (1971); Lingenfelter 20 v. Astrue, 504 F.3d 1028, 1035 (9th Cir. 2007). Substantial evidence is “such 21 relevant evidence as a reasonable mind might accept as adequate to support a 22 conclusion.” Richardson, 402 U.S. at 401. The Court must review the record as a 23 whole, weighing both the evidence that supports and the evidence that detracts from 24 the Commissioner’s conclusion. Lingenfelter, 504 F.3d at 1035. Where evidence is 25 susceptible of more than one rational interpretation, the Commissioner’s 26 interpretation must be upheld. See Orn v. Astrue, 495 F.3d 625, 630 (9th Cir. 27 2007). 28 /// 1 DISCUSSION 2 For the reasons discussed below, reversal and remand for further 3 administrative proceedings are warranted for arguments raised in Issues One and 4 Three, based on the ALJ’s assessment of a non-examining physician’s opinion and 5 a lay witness’s testimony. Thus, the Court declines to address Plaintiff’s remaining 6 arguments. See Hiler v. Astrue, 687 F.3d 1208, 1212 (9th Cir. 2012) (“Because we 7 remand the case to the ALJ for the reasons stated, we decline to reach [plaintiff’s] 8 alternative ground for remand.”); see also Augustine ex rel. Ramirez v. Astrue, 536 9 F. Supp. 2d 1147, 1153 n.7 (C.D. Cal. 2008) (“[The] Court need not address the 10 other claims plaintiff raises, none of which would provide plaintiff with any further 11 relief than granted, and all of which can be addressed on remand.”). 12 13 I. Non-Examining Physician’s Opinion (Issue One). 14 In Issue One, one of Plaintiff’s arguments is that the ALJ failed to consider 15 the opinion of Dr. Kresser, a non-examining, state agency psychologist. (Joint Stip. 16 at 12-13.) 17 18 A. Legal Standard. 19 The Commissioner’s regulations require that “[r]egardless of its source, we 20 will evaluate every medical opinion we received.” 20 C.F.R. §§ 404.1527(c) 21 (2017), 416.927(c) (2017). ALJs “must consider” evidence from State agency 22 medical or psychological consultants. 20 C.F.R. §§ 404.1513a, 416.913a. ALJs 23 “are not bound by findings made by State agency or other program physicians and 24 psychologists, but they may not ignore these opinions and must explain the weight 25 given to these opinions in their decisions.” Social Security Ruling (“SSR”) 96-6P, 26 1996 WL 374180, at *1. An ALJ “may reject the opinion of a non-examining 27 physician by reference to specific evidence in the medical record.” Sousa v. 28 Callahan, 143 F.3d 1240, 1244 (9th Cir. 1998). 1 B. Analysis. 2 After reviewing Plaintiff’s medical record, Dr. Kresser stated that Plaintiff 3 would have moderate limitations in nine areas of mental functioning including, for 4 example, the ability to complete a normal workday and workweek without 5 interruptions from psychologically based symptoms and the ability to respond 6 appropriate to changes in the work setting. (AR 103-04, 114-15.) Dr. Kresser 7 concluded that Plaintiff “[r]etains the ability to perform simple and 2 step 8 operations in [a] low stress environment with minimal or superficial interaction 9 with others.” (AR 104, 115.) 10 The ALJ did not address Dr. Kresser’s opinion, as required by SSR 96-6P. 11 See Bray v. Commissioner of Social Security Admin., 554 F.3d 1219, 1224 (9th Cir. 12 2009) (SSRs are binding on ALJs). Moreover, the error was not harmless because 13 Dr. Kresser’s opinion was more restrictive than the ALJ’s RFC assessment, which 14 did not adopt Dr. Kressler’s limitations to simple and two-step operations in a low 15 stress environment. See Sawyer v. Astrue, 303 F. App’x 453, 455 (9th Cir. 2008) 16 (holding that an ALJ’s failure to consider the opinions of state agency physicians 17 was not harmless error where the ALJ’s RFC assessment did not include their 18 limitations, making the error directly relevant to the ultimate issue of the claimant’s 19 ability to perform work at the level the ALJ assessed). Accordingly, reversal is 20 warranted on this basis. 21 22 II. Lay Witness’s Testimony (Issue Three). 23 In Issue Three, one of Plaintiff’s claims is that the ALJ did not properly 24 assess the oral and written witness testimony of Ms. Duerr, a lay witness. (Joint 25 Stip. at 33-34.) 26 /// 27 /// 28 /// 1 A. Legal Standard. 2 “In determining whether a claimant is disabled, an ALJ must consider lay 3 witness testimony concerning a claimant’s ability to work.” Bruce v. Astrue, 557 4 F.3d 1113, 1115 (9th Cir. 2009) (quoting Stout v. Commissioner, Social Sec. 5 Admin., 454 F.3d 1050, 1053 (9th Cir. 2006)) (internal quotation marks omitted). 6 An ALJ is “required to consider and comment upon competent lay testimony, as it 7 concerned how [a claimant’s] impairments impact his ability to work.” Bruce, 557 8 F.3d at 1115. An ALJ must “provide specific, germane reasons for discounting lay 9 witness testimony”. See Taylor v. Comm’r of Social Sec. Admin., 659 F.3d 1228, 10 1234 (9th Cir. 2011). 11 However, an ALJ’s failure to provide germane reasons to reject a lay 12 witness’s statement may be harmless error. See Molina v. Astrue, 674 F.3d 1104, 13 1122 (9th Cir. 2012). An ALJ’s failure to state any reasons to reject a lay witness’s 14 statement may be harmless error where the lay witness “does not describe any 15 limitations not already described by the claimant, and the ALJ’s well-supported 16 reasons for rejecting the claimant’s testimony apply equally well to the lay witness 17 testimony.” See id. at 1117. Similarly, an ALJ’s statement of reasons that are 18 legally insufficient to reject a lay witness’s statement may be harmless error if the 19 lay witness’s statement is similar to the claimant’s testimony, which the ALJ 20 properly discredited. See, e.g., Sievers v. Berryhill, 734 F. App’x 467, 470 (9th Cir. 21 2018); Watkins v. Commissioner of Social Sec. Admin., 611 F. App’x 903, 904 (9th 22 Cir. 2015). 23 24 B. Background. 25 Ms. Duerr was Plaintiff’s case manager for a training and support program 26 that Plaintiff attended called Facilitating Alternative to Day Environments. (AR 27 591.) Plaintiff qualified for the program because of his autism. (AR 556.) 28 /// 1 Ms. Duerr submitted letters to the ALJ (AR 303-04, 317-18) and testified at 2 the administrative hearing (AR 88-94). In pertinent part, she stated in her letters 3 that Plaintiff would need two weeks “to unwind and rebalance” after “over- 4 stimulation” at community college (AR 303); that bright lights and noise are 5 “stressors” for him (AR 304); that he works half a day per week for an events 6 company (AR 304) but took several days off because of back pain (AR 318); and 7 that he tends to hover between tasks as a coping skill for his autism (AR 304, 317). 8 At the hearing, she testified that Plaintiff could not work full time because the 9 “amount of stimulus would be overwhelming” (AR 89); that even at a night job 10 (with less stimulus), the light would be too stimulating (AR 91-92); and that he 11 loses focus, requiring someone to redirect him for 10 to 15 minutes (AR 93). 12 13 C. Analysis. 14 The ALJ stated that he gave “little weight” to Ms. Duerr’s testimony because 15 she “is not an acceptable medical source,” “is not qualified to interpret how 16 [Plaintiff’s] medically determinable impairments would cause resulting 17 impairments,” and “is not qualified to comment on [Plaintiff’s] response or 18 adherence to treatment or whether appropriate treatment would have an 19 ameliorative effect.” (AR 23.) 20 A lay witness’s status as a non-medical source is an improper ground to 21 disqualify her from offering a statement about a claimant’s ability to work. See 22 Bruce, 557 F.3d at 1116 (“A lay person, . . . though not a vocational or medical 23 expert, was not disqualified from rendering an opinion as to how [the claimant’s] 24 condition affects his ability to perform basic work activities.”); see also Haagenson 25 v. Colvin, 656 F. App’x 800, 802 (9th Cir. 2016) (“The only reason the ALJ offered 26 for rejecting their [lay] opinions is that they are not ‘acceptable medical sources’ 27 within the meaning of the federal regulation. However, the regulation already 28 presumes that nurses and counselors are non-acceptable medical sources, yet still 1 requires the ALJ to consider them as ‘other sources.’”). Thus, this was not a 2 germane reason to reject the lay witness’s testimony. 3 The failure to state a germane reason to reject the lay witness’s testimony 4 was not harmless error. See Molina, 674 F.3d at 1115. The ALJ’s reasons for 5 rejecting Plaintiff’s testimony (assuming they were clear and convincing) would not 6 have applied equally well to Ms. Duerr’s testimony. See id. at 1117. Ms. Duerr’s 7 testimony was broader and more precise than Plaintiff’s testimony. Unlike 8 Plaintiff, Ms. Duerr testified about Plaintiff’s sensitivity to light even at a night job 9 (AR 91-92), his tendency to hover between tasks as a coping skill (AR 304, 317), 10 and his need for someone to redirect him for 10 to 15 minutes after he loses focus 11 (AR 93). The error in the assessment of Ms. Duerr’s statement was not rendered 12 harmless by the ALJ’s findings on the whole. See Burns v. Berryhill, 731 F. App’x 13 609, 613 (9th Cir. 2018) (finding an ALJ’s error in assessing lay testimony was not 14 harmless where the lay witness attested to a number of limitations beyond those 15 reported by the claimant himself); see also Nowling v. Colvin, 813 F.3d 1110, 1122 16 (8th Cir. 2016) (declining to find harmless an ALJ’s failure to consider lay evidence 17 where it “is neither redundant with [the claimant’s] testimony, nor is it discredited 18 by the same evidence that purportedly discredits [the claimant’s] testimony”). 19 Thus, reversal is warranted. 20 21 III. Remand for Further Administrative Proceedings. 22 Ninth Circuit case law “precludes a district court from remanding a case for 23 an award of benefits unless certain prerequisites are met.” Dominguez v. Colvin, 24 808 F.3d 403, 407 (9th Cir. 2015) (citations omitted). “The district court must first 25 determine that the ALJ made a legal error, such as failing to provide legally 26 sufficient reasons for rejecting evidence.” Id. “If the court finds such an error, it 27 must next review the record as a whole and determine whether it is fully developed, 28 /// 1 || is free from conflicts and ambiguities, and all essential factual issues have been 2 || resolved.” (citation and internal quotation marks omitted). 3 Here, all essential factual issues have not been resolved. The record raises 4 || factual conflicts about Plaintiff's level of functioning that “should be resolved 5 || through further proceedings on an open record before a proper disability 6 || determination can be made by the ALJ in the first instance.” See Brown-Hunter, 7 || 806 F.3d at 496; see also Treichler, 775 F.3d at 1101 (stating that remand for an 8 || award of benefits is inappropriate where “there 1s conflicting evidence, and not all 9 || essential factual issues have been resolved”’) (citation omitted); Strauss v. 10 || Commissioner of the Social Sec. Admin., 635 F.3d 1135, 1138 (9th Cir. 2011) 11 || (same where the existing record does not clearly demonstrate that the claimant is 12 || disabled within the meaning of the Social Security Act). 13 Therefore, based on its review and consideration of the entire record, the 14 || Court has concluded on balance that a remand for further administrative 15 || proceedings pursuant to sentence four of 42 U.S.C. § 405(g) is warranted here. It is 16 || not the Court’s intent to limit the scope of the remand. 17 18 ORDER 19 It is ordered that Judgment be entered reversing the final decision of the 20 |} Commissioner of Social Security and remanding this matter for further 21 || administrative proceedings. 22 23 | DATED: April 27, 2020 ° 24 | yey 29 M A. AUDERO 36 D STATES MAGISTRATE JUDGE
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