Fernando Huerta v. Nancy A Berryhill, No. 2:2018cv03031 - Document 25 (C.D. Cal. 2019)
Court Description: MEMORANDUM OPINION AND ORDER REVERSING DECISION OF THE COMMISSIONER OF SOCIAL SECURITY by Magistrate Judge John E. McDermott. IT IS HEREBY ORDERED that Judgment be entered reversing the decision of the Commissioner of Social Security and remanding this case for further proceedings. (See document for details.) (sbou)
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Fernando Huerta v. Nancy A Berryhill Doc. 25 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA 9 10 11 12 FERNANDO HUERTA, Plaintiff, 13 v. 14 NANCY A. BERRYHILL, 15 Acting Commissioner of Social Security, 16 Defendant. 17 22 23 review of the decision by the Commissioner of Social Security (“Commissioner”) denying Plaintiff’s application for Supplemental Social Security Income benefits. (Dkt. 1.) The Commissioner filed an Answer on July 18, 2018. (Dkt. 17.) On November 8, 2018, the parties filed a Joint Stipulation (“JS”). (Dkt. 21.) The matter is now ready for decision. Pursuant to 28 U.S.C. § 636(c), both parties consented to proceed bef ore this 24 25 26 27 28 MEMORANDUM OPINION AND ORDER REVERSING DECISION OF THE COMMISSIONER OF SOCIAL SECURITY On April 11, 2018, Fernando Huerta (“Plaintiff” or “Claimant”) filed a complaint seeking 19 21 Case No. CV 18-03031-JEM PROCEEDINGS 18 20 ) ) ) ) ) ) ) ) ) ) ) ) Magistrate Judge. After reviewing the pleadings, transcripts, and administrative record (“AR”), the Court concludes that the Commissioner’s decision must be reversed and this case remanded for further proceedings in accordance with this Memorandum Opinion and Order and law. Dockets.Justia.com 1 BACKGROUND 2 Plaintiff is a 54 year-old male who applied for Supplemental Social Security Income 3 benefits on June 2, 2014, alleging disability beginning March 29, 2014. (AR 13.) The ALJ 4 determined that Plaintiff has not engaged in substantial gainful activity since June 2, 2014, the 5 application date. (AR 15.) 6 Plaintiff’s claim was denied initially on September 12, 2014, and on reconsideration on 7 December 23, 2014. (AR 13.) Plaintiff filed a timely request for hearing, which was held before 8 Administrative Law Judge (“ALJ”) Michael D. Radensky on December 2, 2016, in Norwalk, 9 California. (AR 13.) Plaintiff appeared and testified at the hearing and was represented by 10 counsel. (AR 13.) Vocational expert (“VE”) Randi A. Langford-Hetrick also appeared and 11 testified at the hearing. (AR 13.) 12 The ALJ issued an unfavorable decision on January 24, 2017. (AR 13-21.) The 13 Appeals Council denied review on February 12, 2018. (AR 1-4.) 14 DISPUTED ISSUES 15 As reflected in the Joint Stipulation, Plaintiff raises the following disputed issues as 16 grounds for reversal and remand: 17 1. Whether the ALJ properly applied Social Security Acquiescence Ruling (AR) 97-4(9). 18 19 2. Whether the ALJ properly developed the record. 20 3. Whether there is a DOT inconsistency in the ALJ’s holding that Plaintiff can 21 22 23 perform the jobs of assembler, inspector, and packager. STANDARD OF REVIEW Under 42 U.S.C. § 405(g), this Court reviews the ALJ’s decision to determine whether 24 the ALJ’s findings are supported by substantial evidence and free of legal error. Smolen v. 25 Chater, 80 F.3d 1273 , 1279 (9th Cir. 1996); see also DeLorm e v. Sullivan, 924 F.2d 841, 846 26 (9th Cir. 1991) (ALJ’s disability determination must be supported by substantial evidence and 27 based on the proper legal standards). 28 2 1 Substantial evidence means “‘more than a mere scintilla,’ but less than a 2 preponderance.” Saelee v. Chater, 94 F.3d 520, 521-22 (9th Cir. 1996) (quoting Richardson v. 3 Perales, 402 U.S. 389, 401 (1971)). Substantial evidence is “such relevant evidence as a 4 reasonable mind might accept as adequate to support a conclusion.” Richardson, 402 U.S. at 5 401 (internal quotation marks and citation omitted). 6 This Court must review the record as a whole and consider adverse as well as 7 supporting evidence. Robbins v. Soc. Sec. Admin., 466 F.3d 880, 882 (9th Cir. 2006). W here 8 evidence is susceptible to more than one rational interpretation, the ALJ’s decision m ust be 9 upheld. Morgan v. Comm’r of the Soc. Sec. Admin., 169 F.3d 595, 599 (9th Cir. 1999). 10 “However, a reviewing court must consider the entire record as a whole and may not affirm 11 simply by isolating a ‘specific quantum of supporting evidence.’” Robbins, 466 F.3d at 882 12 (quoting Hammock v. Bowen, 879 F.2d 498, 501 (9th Cir. 1989)); see also Orn v. Astrue, 495 13 F.3d 625, 630 (9th Cir. 2007). THE SEQUENTIAL EVALUATION 14 15 The Social Security Act defines disability as the “inability to engage in any substantial 16 gainful activity by reason of any medically determinable physical or mental impairment which 17 can be expected to result in death or . . . can be expected to last for a continuous period of not 18 less than 12 months.” 42 U.S.C. §§ 423(d)(1)(A), 1382c(a)(3)(A). The Commissioner has 19 established a five-step sequential process to determine whether a claimant is disabled. 20 20 C.F.R. §§ 404.1520, 416.920. 21 The first step is to determine whether the claimant is presently engaging in substantial 22 gainful activity. Parra v. Astrue, 481 F.3d 742, 746 (9th Cir. 2007). If the claimant is engaging 23 in substantial gainful activity, disability benefits will be denied. Bowen v. Yuckert, 482 U.S. 137, 24 140 (1987). Second, the ALJ must determine whether the claimant has a severe impairment or 25 combination of impairments. Parra, 481 F.3d at 746. An impairment is not severe if it does not 26 significantly limit the claimant’s ability to work. Smolen, 80 F.3d at 1290. Third, the ALJ must 27 determine whether the impairment is listed, or equivalent to an impairment listed, in 20 C.F.R. 28 Pt. 404, Subpt. P, Appendix I of the regulations. Parra, 481 F.3d at 746. If the impairment 3 1 meets or equals one of the listed impairments, the claimant is presumptively disabled. Bowen, 2 482 U.S. at 141. Fourth, the ALJ must determine whether the impairment prevents the 3 claimant from doing past relevant work. Pinto v. Massanari, 249 F.3d 840, 844-45 (9th Cir. 4 2001). Before making the step four determination, the ALJ first must determine the claimant’s 5 residual functional capacity (“RFC”). 20 C.F.R. § 416.920(e). The RFC is “the most [one] can 6 still do despite [his or her] limitations” and represents an assessment “based on all the relevant 7 evidence.” 20 C.F.R. §§ 404.1545(a)(1), 416.945(a)(1). T he RFC must consider all of the 8 claimant’s impairments, including those that are not severe. 20 C.F.R. §§ 416.920(e), 9 416.945(a)(2); Social Security Ruling (“SSR”) 96-8p. 10 If the claimant cannot perform his or her past relevant work or has no past relevant work, 11 the ALJ proceeds to the fifth step and must determine whether the impairment prevents the 12 claimant from performing any other substantial gainful activity. Moore v. Apfel, 216 F.3d 864, 13 869 (9th Cir. 2000). The claimant bears the burden of proving steps one through four, 14 consistent with the general rule that at all times the burden is on the claimant to establish his or 15 her entitlement to benefits. Parra, 481 F.3d at 746. Once this prima facie case is established 16 by the claimant, the burden shifts to the Commissioner to show that the claimant may perform 17 other gainful activity. Lounsburry v. Barnhart, 468 F.3d 1111, 1114 (9th Cir. 2006). T o support 18 a finding that a claimant is not disabled at step five, the Commissioner must provide evidence 19 demonstrating that other work exists in significant numbers in the national economy that the 20 claimant can do, given his or her RFC, age, education, and work experience. 20 C.F.R. 21 § 416.912(g). If the Commissioner cannot meet this burden, then the claimant is disabled and 22 entitled to benefits. Id. 23 24 THE ALJ DECISION In this case, the ALJ determined at step one of the sequential process that Plaintiff has 25 not engaged in substantial gainful activity since June 2, 2014, the application date. (AR 15.) 26 /// 27 /// 28 /// 4 At step two, the ALJ determined that Plaintiff has the following medically determinable 1 1 2 severe impairments: degenerative disc disease of the thoracic and lumbar spine; mild 3 degenerative joint disease of the acromioclavicular joint; status post left hip replacement with 4 residual pain; obesity; and diabetes mellitus. (AR 15-16.) At step three, the ALJ determined that Plaintiff does not have an impairment or 5 6 combination of impairments that meets or medically equals the severity of one of the listed 7 impairments. (AR 16.) The ALJ then found that, consistent with the prior ALJ decision, Plaintiff has the RFC to 8 9 perform a range of light work as defined in the Dictionary of Occupational Titles (“DOT”) with 10 the following non-exertional limitations: 11 Claimant is unable to climb ladders, ropes and scaffolds; otherwise, able to 12 perform only occasional climbing, as well as only occasional stooping, kneeling, 13 crouching and crawling; and with the right upper extremity, able to perform only 14 occasional reaching at or above shoulder level. 15 (AR 16-19.) In determining the above RFC, the ALJ made a determination that Plaintiff’s 16 subjective symptom allegations are “not entirely consistent” with the medical evidence and 17 other evidence of record. (AR 17.) At step four, the ALJ found that Plaintiff has no past relevant work. (AR 19.) The ALJ, 18 19 however, also found at step five that, considering Claimant’s age, education, and RFC, there 20 are jobs that exist in significant numbers in the national economy that Claimant can perform, 21 including the jobs of assembler, inspector, and packager. (AR 19-20.) Consequently, the ALJ found that Claimant is not disabled, within the meaning of the 22 23 Social Security Act. (AR 20-21.) 24 /// 25 /// 26 /// 27 1 28 The medically determinable severe impairments are consistent with a prior ALJ decision. (AR 15.) 5 DISCUSSION 1 2 The ALJ decision must be reversed and remanded for further proceedings. The ALJ 3 and the Commissioner have misapplied the continuing nondisability presumption set forth in 4 Chavez v. Bowen, 844 F.2d 691 (9th Cir. 1988). The ALJ also failed to fully develop the 5 record. 6 A. Background 7 In a previous case, Plaintiff filed an application for Supplemental Security Income on 8 May 30, 2012, alleging disability beginning January 1, 2005. (AR 13, 123-130.) In that case, 9 the ALJ determined that Plaintiff had the severe medically determinable impairments of 10 degenerative disc disease of the thoracic and lumbar spine; mild degenerative joint disease of 11 the acromioclavicular joint; joint status left hip pain replacement with residual pain; obesity; and 12 diabetes mellitus. (AR 125.) On March 28, 2014, the ALJ f ound that Plaintiff was not disabled 13 because he could perform a reduced range of light work. (AR 15, 16, 126-130.) 14 On June 2, 2014, Plaintiff filed an application for Supplemental Security Income in this 15 case, alleging disability beginning March 29, 2014. (AR 13.) As in the prior decision, the ALJ 16 found that Plaintiff had the severe medically determinable impairments of degenerative disc 17 disease of the thoracic and lumbar spine, mild degenerative joint disease of the 18 acromioclavicular joint, status post left hip replacement with residual pain; obesity; and 19 diabetes mellitus. (AR 15). As in the prior decision, the ALJ found that Plaintiff was not 20 disabled because he could perform a reduced range of light work. (AR 16-21.) Thus, Plaintiff’s 21 impairments and RFC as determined by the ALJ in this action were the same as in the prior 22 action. 23 B. Relevant Federal Law 24 The Ninth Circuit in Chavez held that the principles of res judicata apply to administrative 25 decisions, although the doctrine is applied less rigidly to administrative proceedings than to 26 judicial proceedings. Id. at 693. A claimant, in order to overcome the presumption of 27 continuing nondisability arising from a prior ALJ finding of nondisability, must prove “changed 28 circumstances” indicating a greater disability. Id. The court found that Chavez’s attainment of 6 1 advanced age constituted a changed circumstance precluding application of res judicata. Id. 2 Nonetheless, the Ninth Circuit held that the first ALJ’s finding concerning a claimant’s RFC, 3 education, and work experience is entitled to some res judicata consideration unless there is 4 new and material evidence presented. Id. at 694. 5 Because Chavez departed from Social Security policy, the SSA issued Acquiescence 6 Ruling (AR) 97-4(9) accepting Chavez for the Ninth Circuit only. AR 97-4(9) applies only to 7 cases involving a subsequent disability claim on which there has been a final decision by an 8 ALJ or the Appeals Council that a claimant is not disabled. AR 97-4(9) directs adjudicators, 9 when adjudicating a subsequent claim involving an unadjudicated period, to apply a 10 presumption of continuing nondisabiltiy unless the claimant rebuts the presumption. A claimant 11 may do so by showing a “changed circumstance” such as a change in age category (as 12 occurred in Chavez), an increase in the severity of a claimant’s impairment(s) not previously 13 considered, or a change in criteria for determining disability. 14 C. Analysis 15 The ALJ made a finding in this case that “there has not been a showing of . . . changed 16 circumstances material to the determination of disability and the presumption of continuing 17 disability has not been rebutted.” (AR 13.) The ALJ adopted the findings of the prior decision. 18 (AR 13.) The ALJ also found that the “objective medical record” does not show any changed 19 circumstances.” (AR 17.) The ALJ further found no evidence to support an increase in the 20 severity of Claimant’s impairment or the prior residual functional capacity which is adopted in 21 the decision. (AR 19.) The ALJ concluded there are no changed circumstances material to 22 disability to rebut the presumption of continuing nondisability. (AR 19.) 23 The ALJ’s findings are not supported by substantial evidence. The prior decision found 24 that Plaintiff had “mild” degenerative disc disease of the acromioclavicular joint. (AR 125.) In 25 this case, the ALJ made the same finding. (AR 15.) The objective medical evidence, however, 26 is contrary to this finding. A physical examination on August 5, 2015, indicated chronic right 27 arm pain as a result of being stabbed 12 times in 2005 and moderately reduced range of 28 motion. (AR 18, 604, 606, 607.) An August 24, 2015 treatment note recorded sharp pain 7 1 aggravated by movement, crepitus, decreased mobility, numbness, weakness, and swelling. 2 (AR 609.) A September 23, 2015 treatment note indicated moderate pain. (AR 616.) Plaintiff 3 underwent an MRI of the right shoulder on January 9, 2016, which documented moderate 4 arthrosis and moderate subacromial/subdeltoid bursa fluid likely due to an adjacent full5 thickness rotator cuff tear. (AR 18, 640.) The supraspinal tendon demonstrates a full6 thickness full-width tear and retraction by two centimeter tear; the subscapularis tendon with a 7 three centimeter tear. (AR 18, 640.) There was mild to moderate muscle bulk atrophy. (AR 8 18, 640.) The MRI also revealed moderate acromioclavicular joint arthrosis and moderate 9 glenohumeral joint effusion. (AR 641.) Although the ALJ indicated there was no actual 10 aggressive treatment (AR 18), in fact one month after the ALJ’s decision on January 24, 2017, 11 Plaintiff underwent right shoulder rotator cuff surgery on February 28, 2017. (AR 64.) 12 Even without considering the rotator cuff surgery, Plaintiff’s shoulder impairment 13 arguably is no longer mild as of January 9, 2016, the date of the MRI. The ALJ’s own findings 14 suggest as much. At the least, the record was ambiguous and the ALJ had a duty to develop 15 the record regarding the increased severity of Plaintiff’s right shoulder impairment. The ALJ 16 has a special independent duty to develop the record fully and fairly. Tonapetyan v. Halter, 242 17 F.3d 1144, 1150 (9th Cir. 2001); Smolen, 80 F.3d at 1288. Ambiguous evidence triggers the 18 ALJ’s duty to conduct “an appropriate inquiry.” Smolen, 80 F.3d at 1288. 19 The February 28, 2017 rotator cuff surgery obviously undermines the ALJ’s dismissal of 20 Plaintiff’s right shoulder impairment based on conservative treatment. The rotator cuff surgery 21 evidence (AR 64-66) was not before the ALJ, but it was before the Appeals Council, which 22 disregarded it as outside the relevant period. (AR 2.) 23 This Court has no jurisdiction to review the decision of the Appeals Council denying 24 review. Brewes v. Comm’r, 682 F.3d 1157, 1161-62 (9th Cir. 2012). W hen the Appeals 25 Council denies review, the ALJ’s decision becomes the final decision of the Commissioner, and 26 the Court reviews that decision for substantial evidence based on the record as a whole, 27 including any new evidence submitted to and considered by the Appeals Council. Id. at 116128 8 1 63. The Ninth Circuit in Brewes specifically cited and relied on 20 C.F.R. § 404.970(b), which 2 provides: 3 If new and material evidence is submitted, the Appeals Council shall 4 consider the additional evidence only where it relates to the period on or 5 before the date of the administrative law judge hearing decision. The 6 Appeals Council shall evaluate the entire record including the new and 7 material evidence submitted . . . . It will then review the case if it finds that 8 the administrative law judge’s action, findings, or conclusion is contrary to 9 the weight of the evidence currently of record. 10 Id. (emphasis added); see also 42 U.S.C. § 405(g). The new evidence must be treated as part 11 of the administrative record. Id. at 1162. Remand, however, is warranted only if there is new 12 evidence that is material; new evidence is material if it bears directly and substantially on the 13 matter in dispute and if there is a “reasonable possibility” that the new evidence would have 14 changed the outcome of the determination. Bruton v. Massanari, 268 F.3d 824, 827 (9th Cir. 15 2001) (citing Booz v. Sec’y of Health & Human Services, 734 F.2d 1378, 1380 (9th Cir. 1984)); 16 see also La Cruz v. Colvin, 2016 WL 6562930, at *7 (C.D. Cal. Mar. 7, 2016). 17 The new rotator cuff surgery evidence is material because there is a “reasonable 18 possibility” that the new evidence would have changed the outcome of the determination here. 19 The rotator cuff surgery appears to the Court to relate back to the January 9, 2016 MRI 20 documenting an increase in the severity of Plaintiff’s right shoulder condition, a period 21 exceeding 12 months. At the least, based on the f ull record before the Court, there was a 22 failure to develop the record fully and fairly to determine whether the rotator cuff surgery on 23 February 28, 2017, related back to the January 9, 2016 MRI. 24 The Court also finds that the ALJ failed to fully develop the record regarding Plaintiff’s 25 degenerative disc disease of the thoracic and lumbar spine. In the prior decision, the ALJ 26 made a finding that December 2012 X-rays showed multilevel severe and moderate 27 degenerative disc disease of the lumbar spine with slight decreased range of motion and 28 minimal impairment in range of motion of the cervical spine. (AR 125.) In this case, a February 9 1 18, 2016 MRI of the lumbar spine showed moderate to severe disc dessication at six different 2 locations with 3 to 6 mm central disc protrusion. (AR 18, 642-643.) There was moderate to 3 severe foraminal stenosis bilaterally as well as mild central canal stenosis. (AR 642-643.) The 4 ALJ, without benefit of medical source findings, dismissed the evidence of increasing severity 5 of Plaintiff’s lumbar degenerative disc disease on the basis of conservative treatment and non6 compliance with treatment. (AR 18.) The ALJ again failed to develop the record fully and fairly 7 by ordering a consulting examination to determine whether the increased severity of his lumbar 2 8 disc disease resulted in greater functional restrictions than are contained in the RFC. In sum, the assessed RFC is not supported by substantial evidence because the ALJ did 9 10 not fully and fairly develop the record on whether the increasing severity of Plaintiff’s right 11 shoulder and lumbar spine impairments constitute changed circumstances material to the 3 12 determination of disability. 13 ORDER 14 IT IS HEREBY ORDERED that Judgment be entered reversing the decision of the 15 Commissioner of Social Security and remanding this case for further proceedings in 16 accordance with this Memorandum Opinion and Order and with law. 17 18 DATED: May 7, 2019 19 /s/ John E. McDermott JOHN E. MCDERMOTT UNITED STATES MAGISTRATE JUDGE 20 21 22 23 24 2 25 26 27 28 The Commissioner also argued that the change in age from 49 to 50 years old made no difference and did not represent a changed circumstance material to the determination of disability as it did in Chavez. Plaintiff did not demonstrate how it would be material or respond to the Commissioner’s argument. 3 In view of the Court’s reversal on the first two issues raised, the Court sees no need to address the third issue as Plaintiff’s RFC may change on remand. 10
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