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Mayda J. P. v. Berryhill

United States District Court, D. South Dakota, Western Division

February 8, 2019

MAYDA J. P., [1] Plaintiff,
v.
NANCY A. BERRYHILL, Acting Commissioner, Social Security Administration, Defendant.

          ORDER

          JEFFREY L. VIKEN, CHIEF JUDGE

         INTRODUCTION

         On September 5, 2006, plaintiff Mayda J. P. applied for disability insurance benefits (“DIB”) and supplemental security income (“SSI”) pursuant to Titles II and XVI of the Social Security Act, 42 U.S.C. §§ 401-33, 1381-83f, respectively. (Administrative Record, pp. 12, 101-07). Following an adverse decision, Mayda P. timely filed her complaint in district court. (Docket 1). On November 28, 2011, the court entered an order vacating the decision of the Commissioner and remanding plaintiff's case for a new hearing. (Docket 32). The court retained jurisdiction pursuant to sentence six of 42 U.S.C. § 405(g). Id. at p. 12. On July 8, 2016, the Commissioner filed a motion to reopen the case. (Docket 91). The Commissioner reported that on January 13, 2016, an administrative law judge (“ALJ”) “issued a partially favorable decision, finding [Mayda P.] disabled beginning December 29, 2014, for purposes of DIB and SSI.” (Docket 92 ¶ 4). The court granted the motion to reopen the case. (Docket 95). Mayda P. filed a motion seeking reversal of the decision of the Commissioner and requesting an order for calculation and payment of benefits. (Docket 99). Plaintiff sought DIB and SSI benefits for the period August 8, 2006, through December 28, 2014, and asked the court to require the Commissioner to compute benefits.[2] (Docket 100). The court affirmed “the decision of the Commissioner . . . as it relates to an award of DIB and SSI benefits beginning December 29, 2014, ” and reversed “the decision of the Commissioner . . . as it relates to the denial of DIB and SSI benefits prior to December 29, 2014, ” and remanded the case “to the Commissioner for the purpose of calculating and awarding benefits to the plaintiff Mayda J. [P.] for the period of August 8, 2006, through December 28, 2014.” (Docket 104 at pp. 32-33).

         Pursuant to the Equal Access to Justice Act (“EAJA”), 28 U.S.C. § 2412, Catherine Ratliff, counsel for Mayda P., timely moved for an award of attorney's fees and expenses. (Docket 106). The motion seeks an award of $72, 656.72 in attorney's fees, court costs of $400 and expenses of $927.37 and $4, 722.24 in state and local sales tax. Id. at p. 1. The Commissioner opposes an award of EAJA fees. (Docket 110). For the reasons stated below, the court grants in part and denies in part Mayda P.'s motion.

         ANALYSIS

         The EAJA permits an award to a plaintiff of fees and expenses[3] incurred in any civil action brought by or against the United States, “unless the court finds that the position of the United States was substantially justified or that special circumstances make an award unjust.” 28 U.S.C. § 2412(d)(1)(A). “Whether or not the position of the United States was substantially justified shall be determined on the basis of the record (including the record with respect to the action or failure to act by the agency upon which the civil action is based) which is made in the civil action for which fees and other expenses are sought.” 28 U.S.C. § 2412(d)(1)(B).

         The government bears the burden of proving its position was substantially justified. Goad v. Barnhart, 398 F.3d 1021, 1025 (8th Cir. 2005). A social security claimant may be the prevailing party for purposes of the EAJA, yet still not be entitled to an award of fees if the government's position was substantially justified. “A position enjoys substantial justification if it has a clearly reasonable basis in law and fact.” Id. A loss on the merits by the government does not create a presumption that it lacked substantial justification for its position. Id. This distinction is explained as follows:

The district court correctly recognized that “fees are not . . . awarded just because the Secretary [loses a] case.” The Secretary's position in denying benefits can be substantially justified even if the denial is unsupported by substantial evidence on the record as a whole. This is so because the substantial evidence and substantial justification standards are different. Under the substantial evidence standard, the district court must consider evidence that both supports and detracts from the Secretary's position. In contrast, under the substantial justification standard the district court only considers whether there is a reasonable basis in law and fact for the position taken by the Secretary. Because the standards are “neither semantic nor legal equivalents, ” the Secretary can lose on the merits of the disability question and win on the application for attorney's fees.

Welter v. Sullivan, 941 F.2d 674, 676 (8th Cir. 1991) (internal citations omitted). For purposes of this analysis, the “ ‘position of the United States' means, in addition to the position taken by the United States in the civil action, the action . . . by the agency upon which the civil action is based . . . .” 28 U.S.C. § 2412(d)(2)(D).

         The Commissioner's argument in defense of the agency decision is broken down into two separate parts. First, the Commissioner contends the decision of ALJ #1[4] before the court's sentence six remand was substantially justified. (Docket 110 at pp. 3-5). Second, the Commissioner contends the decision of ALJ #5 was substantially justified. Id. at pp. 5-7. Each of these arguments will be separately addressed.

         DECISION OF ALJ #1

         The Commissioner argues the 2011 sentence six remand order was premised on plaintiff's “failure to meet her burden to produce evidence.” Id. at p. 3. The Commissioner submits:

[Mayda P.] was represented during the administrative process and had multiple opportunities to ensure a complete record. Nonetheless, following numerous levels of administrative review, in her initial brief to this Court, Plaintiff appended approximately 100 pages of additional medical evidence, much of which she failed to submit to the ALJ or the Appeals Council, despite the fact that all of this evidence was in existence at the time of the initial ALJ decision and nearly all could reasonably have been proffered for the ALJ's consideration.

Id. at p. 4. The Commissioner contends “Plaintiff did not notify the ALJ of any outstanding evidence as of her February 2009 initial hearing . . . . Plaintiff should not be rewarded for failing her basic duty to proffer to the Commissioner the extensive, existing evidence relating to whether or not she was disabled.” Id. “This failure, ” the Commissioner argues “prevented the Court from considering the merits and required the Commissioner's consideration of additional evidence on remand.” Id.

         Plaintiff opposes the Commissioner's argument. (Docket 111). First, plaintiff points out Mayda P. was not represented during her 2009 hearing, but rather appeared pro se. Id. at p. 2. Second, plaintiff argues the “Commissioner's position that [Mayda P.] lost her case due to her own fault in not submitting her records to [ALJ #1] suggests the government has not accepted the principles enunciated in [Snead v. Barnhart, 360 F.3d 834, 838 (8th Cir. 2004)].” Id. at p. 4.

         During the 2009 hearing, ALJ #1 found Mayda P. suffered from among other severe impairments, “memory impairment with borderline intellectual functioning.” (Docket 104 at p. 5 (internal reference and footnotes omitted). In the first set of JSMF, the Commissioner acknowledged Mayda P. had a full scale IQ of 76. (Docket 18 ¶ 26). Mayda P.'s intellectual testing resulted in “borderline scores . . . on tests measuring factual knowledge and ability to use reasoning skills and make judgement [sic].” Id. ¶ 28. In the second set of JSMF, the Commissioner acknowledged Mayda P. had a “a full scale IQ of 76, indicating borderline general intelligence.” (Docket 98 ¶ 270). Also in the JSMF the Commissioner agreed Mayda P. appeared pro se at the 2009 hearing before ALJ #1. See Id. ¶¶ 3-4.

         In the 2011 remand order, the court listed the medical records which ALJ #1 was put on notice of and which should have been included in the administrative record. (Docket 32 at p. 9). The court found those “medical records [were] material . . . non-cumulative . . . and probative of [Mayda P.'s] condition for the time period for which benefits were denied . . . .” Id. at p. 11 (internal quotation marks and citation omitted). The court found “[t]he Commissioner offers no explanation or good reason why these relevant medical records were never requested.” Id. (referencing 28 U.S.C. § 404.1512(d)).

         It is incomprehensible to the court how the Commissioner could argue that an individual suffering a severe memory impairment indicative of borderline intellectual functioning should carry the burden of producing medical records known to ALJ #1 and within the obligation of ALJ #1 to obtain. The court finds the Commissioner's current argument disingenuous and without merit.

         The court finds the government cannot meet its burden in showing substantial justification for its position. The government's position was not well founded in fact or law, as explained in the court's reversal and remand order. Lauer v. Barnhart, 321 F.3d 762, 764 (8th Cir. 2003) (“The standard is whether the Secretary's position is ‘clearly reasonable, well founded in law and fact, solid though not necessarily correct.' ”) (citation omitted).

         DECISION OF ALJ #5

         The Commissioner argues the decision of ALJ #5 was substantially justified. (Docket 110 at pp. 5-7). “The Commissioner submits that 42 U.S.C. § 423(d)(2)(A) does not require that the job opportunities exist within the local area, but only that the job opportunities exist in the national economy.” Id. at p. 5. The Commissioner argues “[a] vocational expert is only required to state his opinion as to the No. of jobs available in the national economy to a person with the claimant's RFC, age, work experience, and education.” Id. While this court's finding that ALJ #5 erred was premised on several cases from the United States Court of Appeals for the Eighth Circuit, the Commissioner contends the court failed to consider Dressel v. Califano, 558 F.2d 504, 508-09 (8th Cir. 1977). Id. at p. 6.

         The Commissioner argues ALJ #5 considered two jobs a vocational expert identified which “existed in significant No. in the national economy―final assembler with 30, 100 jobs nationally, and bench hand with 30, 200 jobs nationally.” Id. With this supporting testimony, the Commissioner contends “it is not the facts or the ultimate merits of the case, but the standard of review utilized that differs as between the Court's determination on the merits and its determination on the fee issue currently before it. For the reasons discussed above, the Commissioner's decision in this case was substantially justified.” Id. at p. 7.

         In response, Mayda P. points out that following the decision of ALJ #3, “the Appeals Council found that 350 ‘local' jobs were not a significant number.” (Docket 111 at p. 5) (referencing Docket 104 at pp. 29-30). Plaintiff argues the decision of ALJ #5 failed to mention that “the No. of regional jobs was 227.” Id. Plaintiff submits ALJ #5's decision that the national job No. satisfied 42 U.S.C. § 423(d)(2)(A) was clearly wrong. Id.

         For clarity of the court's analysis, it is necessary to incorporate from the 2018 order the court's consideration of this issue. (Docket 104 at pp. 29-31). “It must be remembered that ALJ #2 found [Mayda P.] was not disabled because she could perform three sedentary jobs, specifically: microfilm document preparer, with 100, 000 jobs in the national economy; addresser, with 20, 000 jobs in the national economy; and sack repairer with 12, 000 jobs in the national economy.” Id. at p. 29 (internal reference omitted). “The Appeals Council expressed concern because this finding did not consider the testimony of the vocational expert which identified the following local jobs in the state of South Dakota: microfilm document preparer, 200 local jobs; addresser, 100 local jobs; and sack repairer, 50 local jobs.” Id. at pp. 29-30 (internal reference omitted). “The Appeals Council remanded the case declaring ‘[a]lthough the No. of national jobs appears to represent a significant No. of jobs, the No. of local jobs identified does not appear to represent a significant No. of jobs. Accordingly, further evaluation as to whether a significant No. of other jobs exist is necessary.' ” Id. at p. 30 (internal reference and emphasis omitted).

         “The Appeals Council's own determination in 2014 that 350 jobs in South Dakota would not satisfy the requirements of § 404.1566 is a strong endorsement that ALJ #5's decision is not sustainable.” Id. “Had the Appeals Council in 2014 believed the national No. satisfied § 404.1566, there would have been no need to comment on that section of the ALJ's decision or remand for development of additional job evidence because the step five evaluation would have been satisfied by the national numbers.” Id. at p. 30 n.26.

         “Incredibly, in 2015 the Commissioner presented no testimony of the No. of jobs available to [Mayda P.] in the state of South Dakota or the impact upon her if she is compelled to travel to the other regions or nationally for work.” Id. (emphasis in original). “This total absence of evidence cannot and does not sustain the Commissioner's burden at step five.” Id. at p. 30 (referencing Stormo v. Barnhart, 377 F.3d 801, 806 (8th Cir. 2004)). “Furthermore, the court is unable to identify one case in the Eighth Circuit which would support a conclusion that 227 jobs in the surrounding states of Wyoming, Montana and North Dakota satisfy the ‘significant number' criteria of 20 CFR §§ 404.1566(b) & (d) for a South Dakota resident.” Id. at p. 30.

         The court specifically laid out its research noting “the rulings of a No. of courts which each made specific reference to the No. of jobs available in a plaintiff's state of residence as being significant at step five.” Id. at pp. 25-27. The Commissioner fails to identify one case which contradicts the court's analysis and permits a step five finding of a claimant not being disabled when there are no jobs available in claimant's state of residence. While not the final word on the present issue before the court, it must be noted the Commissioner did not appeal from the 2018 order. Had the Commissioner believed the significant No. in the national economy argument was meritorious, an appeal to the Eighth Circuit would most certainly have been filed.

         The court finds the government cannot meet its burden in showing substantial justification for its position. The government's position was not well founded in fact or law, as explained in the court's reversal and remand order. Lauer, 321 F.3d at 764.

         The court finds Mayda P. is entitled to an award pursuant to the EAJA. 28 U.S.C. § 2412(d)(1)(A).

         Addressing EAJA fees following a sentence six remand under 42 U.S.C. § 405(g), the Supreme Court declared “[o]ur past decisions interpreting other fee-shifting provisions make clear that where administrative proceedings are intimately tied to the resolution of the judicial action and necessary to the attainment of the results Congress sought to promote by providing for fees, they should be considered part and parcel of the action for which fees may be awarded.” Sullivan v. Hudson,490 U.S. 877, 888 (1989) (referencing Pennsylvania v. Delaware Valley Citizens' Council,478 U.S. 546 (1986); New York Gas Light Club, Inc. v. Carey,447 U.S. 54 (1980)). “As in Delaware Valley, the administrative proceedings on remand in this case were ‘crucial to the vindication of [respondent's] rights.' ” Id. at 889 (citing Delaware Valley Citizens' Council, 478 U.S. at 561). “No fee award at all would have been available to respondent absent successful conclusion of the remand proceedings, and the services of an attorney may be necessary both to ensure compliance with the District Court's order in the administrative proceedings themselves, and to prepare for any further proceedings before the District Court to verify such compliance.” Id. “Since the judicial review provisions of the Social Security Act contemplate an ongoing civil action of which the remand proceedings are but a part, and the EAJA allows ‘any court having jurisdiction of that action' to award fees, . . . we think the statute, read in light of its purpose ‘to diminish the deterrent effect of seeking review of, or defending against, governmental action,' . . . permits a court to award fees for services performed on remand before the Social Security Administration.” Id. at 890 (citing 28 U.S.C. § 2412(d)(1)(A) and 94 Stat. 2325). “Where a court finds that the Secretary's position on judicial review was not substantially justified within the meaning ...


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