The opinion of the court was delivered by: Alicia G. Rosenberg United States Magistrate Judge
MEMORANDUM OPINION AND ORDER
Plaintiff Kevin Butler ("Butler") filed a Complaint on September 3, 2008. (Dkt. No. 3.) Pursuant to 28 U.S.C. § 636(c), the parties filed Consents to proceed before Magistrate Judge Rosenberg on September 24 and October 3, 2008. (Dkt. Nos. 7, 9.) The parties filed a Joint Stipulation ("JS") on July 27, 2009, that addressed the disputed issues in this case. (Dkt. No. 21.) The Commissioner filed the certified administrative record ("AR"). The Court has taken the Joint Stipulation under submission without oral argument.
Having reviewed the entire file, the Court concludes that the decision of the Commissioner is reversed and remanded for further proceedings.
On May 23, 2005, Butler filed an application for supplemental security income ("SSI") benefits, AR 107-09, which the Commissioner denied initially and on reconsideration. AR 51-52. Butler requested a hearing. AR 75. On February 5, 2007, the Administrative Law Judge ("ALJ") conducted a hearing, at which Butler failed to appear. AR 360-63. On February 26, 2007, the ALJ issued a decision denying benefits. AR 31-41. Butler requested review. AR 92.
On May 18, 2007, the Appeals Council issued an order vacating the ALJ's decision and remanding the case for further proceedings. AR 95-96. The Council ordered the ALJ on remand to (1) obtain available updated treatment records; (2) address all relevant lay statements and testimony, providing supporting rationale for the weight assigned thereto; (3) follow the procedures in HALLEX I-2-4-25D as appropriate if the circumstances again warrant a finding as to whether Butler constructively waived his right to appear; and (4) if warranted, obtain evidence from a vocational expert ("VE") to clarify the effect of the assessed limitations on Butler's occupational base. Id.
On February 13, 2008, the ALJ conducted a second hearing, at which Butler and a VE testified. AR 364-73. On March 25, 2008, the ALJ issued a decision denying benefits. AR 12-24. Butler requested review. AR 11. On July 11, 2008, the Appeals Council denied Butler's request for review. AR 7-9. This lawsuit 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 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, "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 a conclusion." Vasquez v. Astrue, 572 F.3d 586, 591 (9th Cir. 2009) (citation and quotation marks omitted); Moncada, 60 F.3d at 523; see also Ryan v. Comm'r of Soc. Sec., 528 F.3d 1194, 1198 (9th Cir. 2008). 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. 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.
III. EVALUATION OF DISABILITY
A person qualifies as disabled and is eligible for benefits, "only if his physical or mental impairment or impairments are of such severity that he is not only unable to do his previous work but cannot, considering his age, education, and work experience, engage in any other kind of substantial gainful work which exists in the national ...