The opinion of the court was delivered by: Paul L. Abrams United States Magistrate Judge
MEMORANDUM OPINION AND ORDER
Plaintiff filed this action on March 4, 2009, seeking review of the Commissioner's denial of his applications for Disability Insurance Benefits and Supplemental Security Income payments. The parties filed Consents to proceed before the undersigned Magistrate Judge on March 27, 2009, and March 28, 2009. Pursuant to the Court's Order, the parties filed a Joint Stipulation on September 21, 2009, that addresses their positions concerning the disputed issues in the case. The Court has taken the Joint Stipulation under submission without oral argument.
Plaintiff was born on December 28, 1960. [Administrative Record ("AR") at 76, 332.] He has a twelfth grade education. [AR at 100, 323, 379.] Plaintiff previously worked as a custodian, jewelry repairer, and bus driver. [AR at 95, 324, 362.]
On August 26, 2002, plaintiff protectively filed applications for Disability Insurance Benefits and Supplemental Security Income payments, in which he alleged he has been unable to work since December 15, 2001, due to depression, a sleep disorder, and anxiety attacks. [AR at 76-80, 93-102.] After his applications were denied initially and on reconsideration, plaintiff requested a hearing before an Administrative Law Judge ("ALJ"). [AR at 28, 30-35.] A hearing was held on June 29, 2004, at which plaintiff appeared with counsel and testified on his own behalf. A vocational expert ("VE") also testified. [AR at 218-41.] The ALJ determined that plaintiff was not disabled. [AR at 10-18.] Plaintiff requested review of the hearing decision. [AR at 9.] The Appeals Council denied review on August 8, 2005. [AR at 5-8.] Plaintiff then filed an action in District Court, Case No. ED CV 05-930-PLA, challenging the Commissioner's decision. On November 2, 2006, the Court remanded the matter for further proceedings, concluding that the ALJ failed to properly address the medical opinion evidence, including the nonexamining physicians' residual functional capacity assessment and the findings of Dr. Richard Hicks, a consultative examining psychiatrist. [AR at 270-80.] On January 6, 2007, the Appeals Council remanded the case for further proceedings. [AR at 267-69.] A second hearing was held on October 3, 2007, at which plaintiff appeared with counsel and testified on his own behalf. A VE also testified. [AR at 386-403.] The ALJ again determined that plaintiff was not disabled. [AR at 254-66.] Plaintiff requested review of the second hearing decision. [AR at 293.] On May 3, 2008, the Appeals Council remanded the case again, finding that the second ALJ also failed to properly address the nonexamining physicians' and Dr. Hicks' findings concerning plaintiff's limitations. [AR at 295-99.] A third administrative hearing was held on September 18, 2008, at which plaintiff appeared with counsel and testified on his own behalf. A medical expert and VE also testified. [AR at 346-85.] On November 4, 2008, the ALJ determined that plaintiff was not disabled. [AR at 242-53.] On approximately January 4, 2008, the ALJ's most recent decision became the final decision of the Commissioner. [Joint Stipulation ("JS") at 3.] This action followed.
Pursuant to 42 U.S.C. § 405(g), this Court has authority to review the Commissioner's decision to deny benefits. The decision will be disturbed only if it is not supported by substantial evidence or if it is based upon the application of improper legal standards. Moncada v. Chater, 60 F.3d 521, 523 (9th Cir. 1995); Drouin v. Sullivan, 966 F.2d 1255, 1257 (9th Cir. 1992).
In this context, the term "substantial evidence" means "more than a mere scintilla but less than a preponderance -- it is such relevant evidence that a reasonable mind might accept as adequate to support the conclusion." Moncada, 60 F.3d at 523; see also Drouin, 966 F.2d at 1257. When determining whether substantial evidence exists to support the Commissioner's decision, the Court examines the administrative record as a whole, considering adverse as well as supporting evidence. Drouin, 966 F.2d at 1257; Hammock v. Bowen, 879 F.2d 498, 501 (9th Cir. 1989). Where the evidence is susceptible to more than one rational interpretation, the Court must defer to the decision of the Commissioner. Moncada, 60 F.3d at 523; Andrews v. Shalala, 53 F.3d 1035, 1039-40 (9th Cir. 1995); Drouin, 966 F.2d at 1258.
IV. THE EVALUATION OF DISABILITY
Persons are "disabled" for purposes of receiving Social Security benefits if they are unable to engage in any substantial gainful activity owing to a physical or mental impairment that is expected to result in death or which has lasted or is expected to last for a continuous period of at least twelve months. 42 U.S.C. § 423(d)(1)(A); Drouin, 966 F.2d at 1257.
A. THE FIVE-STEP EVALUATION PROCESS
The Commissioner (or ALJ) follows a five-step sequential evaluation process in assessing whether a claimant is disabled. 20 C.F.R. §§ 404.1520, 416.920; Lester v. Chater, 81 F.3d 821, 828 n.5 (9th Cir. 1995, as amended April 9, 1996). In the first step, the Commissioner must determine whether the claimant is currently engaged in substantial gainful activity; if so, the claimant is not disabled and the claim is denied. Id. If the claimant is not currently engaged in substantial gainful activity, the second step requires the Commissioner to determine whether the claimant has a "severe" impairment or combination of impairments significantly limiting his ability to do basic work activities; if not, a finding of non-disability is made and the claim is denied. Id. If the claimant has a "severe" impairment or combination of impairments, the third step requires the Commissioner to determine whether the impairment or combination of impairments meets or equals an impairment in the Listing of Impairments ("Listing") set forth at 20 C.F.R., Part 404, Subpart P, Appendix 1; if so, disability is conclusively presumed and benefits are awarded. Id. If the claimant's impairment or combination of impairments does not meet or equal an impairment in the Listing, the fourth step requires the Commissioner to determine whether the claimant has sufficient "residual functional capacity" to perform his past work; if so, the claimant is not disabled and the claim is denied. Id. The claimant has the burden of proving that he is unable to perform past relevant work. Drouin, 966 F.2d at 1257. If the claimant meets this burden, a ...