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Daniels v. Astrue


October 1, 2010


The opinion of the court was delivered by: Carla M. Woehrle United States Magistrate Judge


The parties have consented, under 28 U.S.C. § 636(c), to the jurisdiction of the undersigned Magistrate Judge. Plaintiff seeks review of the Commissioner's denial of disability benefits. As discussed below, the court finds that the Commissioner's decision should be reversed and this matter remanded for further proceedings.


Plaintiff Alice Daniels was born on October 23, 1956, and was fifty-one years old at the time of her administrative hearing. [Administrative Record ("AR") 59, 65.] She has approximately two and a half years of college education and past relevant work experience as an instructional aide and lead teacher. [AR 65, 80.] Plaintiff alleges disability on the basis of pain in her lower back and left shoulder due to arthritis, loss of cartilage in her knees, and mental health problems. [AR 69-72.]


Plaintiff's complaint was lodged on September 25, 2009, and filed on October 2, 2009. On April 16, 2010, Defendant filed an Answer and plaintiff's Administrative Record ("AR"). On June 17, 2010, the parties filed their Joint Stipulation ("JS") identifying matters not in dispute, issues in dispute, the positions of the parties, and the relief sought by each party. This matter has been taken under submission without oral argument.


Plaintiff applied for a period of disability and disability insurance benefits ("DIB") and supplemental security income ("SSI") on March 23, 2006, alleging disability since November 1, 2000. [AR 90]. After the application was denied initially and on reconsideration, Plaintiff requested an administrative hearing, which was held on March 18, 2008, before an Administrative Law Judge ("ALJ"). [AR 59.] Plaintiff appeared without counsel, and testimony was taken from Plaintiff and vocational expert Jeanine Metildi. [AR 90.] The ALJ denied benefits in a decision dated June 27, 2008. [AR 87-97.] Plaintiff sought review with the Appeals Council and submitted additional evidence. [AR 6.] When the Appeals Council denied review on August 25, 2009, the ALJ's decision became the Commissioner's final decision. [AR 1.]


Under 42 U.S.C. § 405(g), a district court may review the Commissioner's decision to deny benefits. The Commissioner's (or ALJ's) findings and decision should be upheld if they are free of legal error and supported by substantial evidence. However, if the court determines that a finding is based on legal error or is not supported by substantial evidence in the record, the court may reject the finding and set aside the decision to deny benefits. See Aukland v. Massanari, 257 F.3d 1033, 1035 (9th Cir. 2001); Tonapetyan v. Halter, 242 F.3d 1144, 1147 (9th Cir. 2001); Osenbrock v. Apfel, 240 F.3d 1157, 1162 (9th Cir. 2001); Tackett v. Apfel, 180 F.3d 1094, 1097 (9th Cir. 1999); Reddick v. Chater, 157 F.3d 715, 720 (9th Cir. 1998); Smolen v. Chater, 80 F.3d 1273, 1279 (9th Cir. 1996); Moncada v. Chater, 60 F.3d 521, 523 (9th Cir. 1995)(per curiam). "Substantial evidence is more than a scintilla, but less than a preponderance." Reddick, 157 F.3d at 720. It is "relevant evidence which a reasonable person might accept as adequate to support a conclusion." Id. To determine whether substantial evidence supports a finding, a court must review the administrative record as a whole, "weighing both the evidence that supports and the evidence that detracts from the Commissioner's conclusion." Id. "If the evidence can reasonably support either affirming or reversing," the reviewing court "may not substitute its judgment" for that of the Commissioner. Reddick, 157 F.3d at 720-721; see also Osenbrock, 240 F.3d at 1162.



To be eligible for disability benefits a claimant must demonstrate a medically determinable impairment which prevents the claimant from engaging in substantial gainful activity and which is expected to result in death or to last for a continuous period of at least twelve months. Tackett, 180 F.3d at 1098; Reddick, 157 F.3d at 721; 42 U.S.C. § 423(d)(1)(A).

Disability claims are evaluated using a five-step test:

Step one: Is the claimant engaging in substantial gainful activity? If so, the claimant is found not disabled. If not, proceed to step two.

Step two: Does the claimant have a "severe" impairment? If so, proceed to step three. If not, then a finding of not disabled is appropriate.

Step three: Does the claimant's impairment or combination of impairments meet or equal an impairment listed in 20 C.F.R., Part 404, Subpart P, Appendix 1? If so, the claimant is automatically determined disabled. If not, proceed to step four.

Step four: Is the claimant capable of performing his past work? If so, the claimant is not disabled. If not, proceed to step five.

Step five: Does the claimant have the residual functional capacity to perform any other work? If so, the claimant is not disabled. If not, the claimant is disabled.

Lester v. Chater, 81 F.3d 821, 828 n.5 (9th Cir. 1995, as amended April 9, 1996); see also Bowen v. Yuckert, 482 U.S. 137, 140-142, 107 S.Ct. 2287, 96 L.Ed. 2d 119 (1987); Tackett, 180 F.3d at 1098-99; 20 C.F.R. § 404.1520, § 416.920. If a claimant is found "disabled" or "not disabled" at any step, there is no need to complete further steps. Tackett, 180 F.3d 1098; 20 C.F.R. § 404.1520.

Claimants have the burden of proof at steps one through four, subject to the presumption that Social Security hearings are non-adversarial, and to the Commissioner's affirmative duty to assist claimants in fully developing the record even if they are represented by counsel. Tackett, 180 F.3d at 1098 and n.3; Smolen, 80 F.3d at 1288. If this burden is met, a prima facie case of disability is made, and the burden shifts to the Commissioner (at step five) to prove that, considering residual functional capacity ("RFC")*fn1 , age, education, and work experience, a claimant can perform other work which is available in significant numbers. Tackett, 180 F.3d at 1098, 1100; Reddick, 157 F.3d at 721; 20 C.F.R. § 404.1520, § 416.920.


Here, the ALJ found that Plaintiff had not engaged in substantial gainful activity since her alleged disability onset date (step one); that Plaintiff had "severe" impairments, namely obesity, arthritis and epilepsy (step two); and that Plaintiff did not have an impairment or combination of impairments that met or equaled a "listing" (step three). [AR 92-93.] The ALJ found that Plaintiff had an RFC to perform light work generally; with occasional postural limitations; no ladders, no heights, no dangerous or fast moving machinery; and no open pools of water. [AR 93.] The vocational expert testified that a person with Plaintiff's RFC could perform Plaintiff's past relevant work as an instructional aid and lead teacher (step four). [AR 96.] Accordingly, Plaintiff was found not "disabled" as defined by the Social Security Act. [AR 97.]


The parties' Joint Stipulation raises the following disputed issues:

1. Whether the ALJ failed to properly consider the testimony of Ms. Daniels;

2. Whether the ALJ failed to completely and properly consider the assessment of Dr. Bruce Applebaum;

3. Whether the ALJ failed to properly consider Ms. Daniels' Mental Impairment;

4. Whether the ALJ failed to properly consider the lay witness statement of Forrest Best; and

5. Whether the Appeals Counsel failed to properly consider the new and material evidence.

[JS 2-3.]

As discussed below, Issues One, Two, and Three are dispositive.


Following the ALJ's decision denying Plaintiff's claim for benefits, filed on June 27, 2008, Plaintiff requested review before the Appeals Council on August 27, 2008, and submitted additional evidence, including treatment and examination records by Dr. Applebaum. [AR 6-7, Exhibit 1.] The records indicate that Plaintiff received treatment from Dr. Applebaum from December 3, 2004, to approximately June 6, 2008. [Exhibit 1-2, 1-20.] They also indicate that Dr. Applebaum noted that Plaintiff suffers from major depression, recurrent with moderate psychosis, and exhibits deficits in significant social and occupational functioning. [Exhibit 1-18.] In addition, Dr. Applebaum noted that Plaintiff has a Global Assessment of Functioning ("GAF") score of 42, which is consistent with "serious symptoms OR serious impairment in social, occupational function." [Exhibit 1-22.]

On August 25, 2009, the Appeals Council issued an Order stating that "we considered the reasons you disagree with the decision and the additional evidence [provided]." [AR 1.] The Appeals Council concluded that "this information does not provide a basis for changing the Administrative Law Judge's decision" and denied Plaintiff's request for review. [AR 2.] Plaintiff asserts that this evidence requires reversal of the Commissioner's decision. Plaintiff's claim has merit, particularly as the evidence pertains to Issues One, Two, and Three.


In the Ninth Circuit, the district court's review of the Commissioner's decision requires consideration of "the rulings of both the ALJ and the Appeals Council." Ramirez v. Shalala, 8 F.3d 1449, 1451 (9th Cir. 1993). Even in instances, such as in this case, where the Appeals Council "declines to review" the decision of the ALJ, "it reached this ruling after considering the case on the merits; examining the entire record, including the additional material; and concluding that the ALJ's decision was proper and that the additional material failed to 'provide a basis for changing the hearing decision.' For these reasons, we consider on appeal both the ALJ's decision and the additional material submitted to the Appeals Council." Id. (citing Bates v. Sullivan, 894 F.2d 1059, 1063-64 (9th Cir. 1990)).

The Commissioner's decision must be reversed if it was based on legal error or unsupported by substantial evidence. Id. Here, the evidence that Plaintiff submitted for the first time to the Appeals Council, including the records attributable to her treatment with Dr. Applebaum, was significant and probative to the disability determination and therefore, should have been considered and addressed by the Commissioner. Id. at 1454 (reversing Commissioner's decision when Appeals Council disregarded relevant medical evidence); see also Booz v. Secretary, 734 F.2d 1378, 1380 (9th Cir. 1984)(remanding for reconsideration by the ALJ where there is a "reasonable possibility" that new evidence would have changed the outcome of the case). Accordingly, reversal is required.


In a letter dated February 14, 2007, Dr. Applebaum stated that he has treated Plaintiff since December 2004, and that Plaintiff has major depression, recurrent with moderate psychosis [AR 308-309.] The ALJ considered this evidence and rejected Dr. Applebaum's assessment as not credible, since he "provide[d] no objective basis for his diagnosis" and "offer[ed] no treatment notes and no actual mental status examination." [AR 96.] Instead, the ALJ relied on the opinion of Dr. Ahmad Riahinejad, who examined Plaintiff on June 23, 2006. [AR 268-272.] Dr. Riahinejad's report stated that Plaintiff was capable of managing her own funds, able to carry out simple and complex instructions, accept instructions from supervisors and relate to co-workers, and has no difficulty with pace. [AR 272.]

The ALJ, in reference to Dr. Riahinejad's opinion, determined that Plaintiff's "medically determinable mental impairment of depression does not cause more than minimal limitation in the claimant's ability to perform basic mental work activities and is therefore nonsevere." [AR 92.] However, as noted above, Plaintiff then submitted additional evidence which included Dr. Applebaum's treatment notes and actual mental status examinations. [Exhibit 1.] These records support Dr. Applebaum's assertions in his previous letter. [AR 308-309.]

At step two of the five-step disability evaluation, an impairment or combination of impairments may be found "not severe" only if the evidence establishes a "slight abnormality that has no more than a minimal effect on an individual's ability to work." Webb v. Barnhart, 433 F.3d 683, 686 (9th Cir. 2005)(quoting Smolen v. Chater, 80 F.3d 1273, 1290 (9th Cir. 1996)); see also Yuckert v. Bowen, 841 F.2d 303, 306 (9th Cir. 1988). If an ALJ is "unable to determine clearly the effect of an impairment or combination of impairments on the individual's ability to do basic work activities, the sequential evaluation should not end with the not severe evaluation step." Webb, 433 F.3d at 687 (quoting SSR 85-28, 1985 WL 56856 at *4). Step two, then, involves a "de minimis screening device used to dispose of groundless claims, and an ALJ may find that a claimant lacks a medically severe impairment or combination of impairments only when his conclusion is clearly established by the medical evidence." Webb, 433 F.3d at 687 (citations omitted); see also Yuckert, 841 F.2d at 306 ("Despite the deference usually accorded to the Secretary's application of regulations, numerous appellate courts have imposed a narrow construction upon the severity regulation applied here.").

Under this narrow standard for step two evaluations, the finding that Plaintiff did not have a severe mental impairment is not clearly established by the medical evidence. The record does show that Plaintiff received regular and continuous mental health treatment, takes medication for depression such as Alprazolam and Citalopram [AR 157], and has individual sessions with a psychologist. Moreover, none of the treatment record evidence was discussed or evaluated in the administrative decision, nor did it appear to be taken into account by Dr. Riahinejad. Based on the existing record, the evidence of Plaintiff's claim of mental impairment "is sufficient to pass the de minimis threshold of step two." Webb, 433 F.3d at 687. Although the court "do[es] not intimate that [plaintiff] will succeed in proving that [s]he is disabled," the ALJ should continue the sequential evaluation beyond step two "because there was not substantial evidence to show that [plaintiff's] claim was groundless." Webb, 433 F.3d at 688. Accordingly, the ALJ's finding that the Plaintiff did not suffer from a severe mental impairment should be reversed, and the matter should be remanded for further proceedings.


At the administrative hearing, Plaintiff testified, among other things, that she has arthritis and pain in her low back [AR 69], loss of cartilage in her knees, degenerative arthritis in her left shoulder [AR 71], difficulty sitting for more than 25-30 minutes [AR 75], inability to stand or walk for more than 10-15 minutes [AR 76], and need of a cane for support [AR 71]. She also testified that she suffers from depression, wants to sleep all day, procrastinates, and gets emotional and cries [AR 72].

The ALJ referenced this portion of Plaintiff's testimony in the administrative decision and noted that Plaintiff "has offered little objective medical evidence of a medically determinable impairment or impairment related limitations." [AR 96.] The ALJ also determined, based on a number of reasons including inconsistencies in the Plaintiff's testimony, that Plaintiff's testimony "although appearing sincere, is not fully credible" regarding her symptoms and functional limitations. [Id.] Plaintiff asserts that this determination constituted reversible error because it was not "legally sufficient", and each basis the ALJ relied on is "either false or does not reflect poorly on [Plaintiff's] credibility." [JS 3.]

The standard in the Ninth Circuit for evaluations of subjective symptom testimony in Social Security disability cases requires, first, that the claimant produce medical evidence of an underlying impairment which is reasonably likely to be the cause of the alleged symptom; when this evidence is produced, the Commissioner may not reject a claimant's credibility without specifically making findings which support that conclusion. Bunnell v. Sullivan, 947 F.2d 341, 345 (9th Cir. 1991)(en banc)(affirming standard of Cotton v. Bowen, 799 F.2d 1403, 1407 (1986), for review of ALJ evaluations of pain and subjective symptom testimony). The credibility determination must state "clear and convincing" reasons that includes a specific statement of which symptom testimony is not credible and what facts in the record lead to that conclusion. Smolen v. Chater, 80 F.3d 1273, 1284 (9th Cir. 1996)(citing Dodrill v. Shalala, 12 F.3d 915, 918 (9th Cir. 1993)); see also Lester v. Chater, 81 F.3d at 834 ("For the ALJ to reject the claimant's complaints, [the ALJ] must provide specific, cogent reasons for the disbelief"). A claimant's pain does not need to be affirmed by objective medical evidence, as long as the pain is "associated with such an impairment." Magallanes v. Bowen, 881 F.2d 747, 755 (9th Cir. 1989). On the other hand, evidence of conservative treatment is "sufficient to discount a claimant's testimony regarding severity of an impairment." Parra v. Astrue, 481 F.3d 742, 750-751 (9th Cir. 2007).

Here, Plaintiff satisfied the initial requirement of producing medical evidence of an underlying impairment to warrant such an evaluation. The pain that Plaintiff is experiencing is reasonably associated with such impairments. On the other hand, there is evidence that Plaintiff underwent conservative treatment. There are also instances of inconsistencies between medical records and Plaintiff's assertions. Nevertheless, the court notes that evidence regarding Plaintiff's mental impairment had not been fully considered. When a mental illness is involved, such as depression, the court must be careful in evaluating conservative treatment, because such mental conditions may affect the claimant's willingness to be treated in the first place. See Regenitter v. Comm'r, Soc. Sec. Admin., 166 F.3d 1294, 1299-1300 (9th Cir. 1999). Since the ALJ dismissed the mental illness findings due to lack of a full medical record at the time [AR 96] and did not consider the record as a whole, the determination of credibility itself may have been affected. Hence a more comprehensive determination of credibility is necessary in light of the new evidence. Accordingly, the matter should be reversed and remanded for further proceedings.


The decision whether to remand for further proceedings is within the discretion of the district court. Harman v. Apfel, 211 F.3d 1172, 1175-1178 (9th Cir. 2000). Where no useful purpose would be served by further proceedings, or where the record has been fully developed, it is appropriate to exercise this discretion to direct an immediate award of benefits. Harman, 211 F.3d at 1179 (decision whether to remand for further proceedings turns upon their likely utility). However, where there are outstanding issues that must be resolved before a determination can be made, and it is not clear from the record that the ALJ would be required to find the claimant disabled if all the evidence were properly evaluated, remand is appropriate. Id. Here, as set out above in Issues One, Two, and Three, outstanding issues remain before a finding of disability can be made.*fn2

Accordingly, remand is appropriate.


Accordingly, IT IS ORDERED that:

1. The decision of the Commissioner is REVERSED.

2. This action is REMANDED to defendant, pursuant to Sentence Four of 42 U.S.C. § 405(g), for further proceedings as discussed above.

3. The Clerk of the Court shall serve this Decision and Order and the Judgment herein on all parties or counsel.

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