The opinion of the court was delivered by: Hon. Jay C. Gandhi United States Magistrate Judge
MEMORANDUM OPINION AND ORDER
Fabian Regalado ("Plaintiff") challenges the Social Security Commissioner's ("Defendant") decision denying his application for disability benefits. Specifically, Plaintiff contends that the Administrative Law Judge ("ALJ") improperly rejected the lay testimony of his brother, Victor Palencia. (Joint Stip. at 6, 21-22.) The Court agrees with Plaintiff for the reasons discussed below.
A. The ALJ Failed to Provide Germane Reasons for Rejecting Mr. Palencia's Lay Testimony "[L]ay testimony as to a claimant's symptoms or how an impairment affects [their] ability to work is competent evidence and therefore cannot be disregarded without comment." Stout v. Commissioner, 454 F.3d 1050, 1053 (9th Cir. 2006) (internal quotation marks, ellipses, and citation omitted) (emphasis in original). Appropriately, then, an ALJ may discount the testimony of a lay witness only if he provides specific "reasons that are germane to each witness." Id. (citing Dodrill v. Shalala, 12 F.3d 915, 919 (9th Cir. 1993).)
Here, the ALJ appears to have misunderstood the nature and substance of Mr. Palencia's testimony. In just two sentences, the ALJ disregarded Mr. Palencia as "not an acceptable medical source," and his testimony as not based on "objective diagnostic evidence."*fn2 (AR at 27.)
But lay witnesses are not medical sources. See 20 C.F.R. § 404.1513 (discussing different uses for medical and non-medical sources). Unlike medical evidence, which is used to "establish whether [a claimant has] a medically determinable impairment," lay testimony "show[s] the severity of [that] impairment and how it affects [the claimant's] ability to work." Id. § 404.1513(a) and (d)(4) (emphasis added). Recognizing this difference, the Ninth Circuit has expressly rejected the notion that lay testimony need be supported, or even relevant to the medical record. Bruce v. Astrue, 557 F.3d 1113, 1116 (9th Cir. 2009).
Thus, for the reasons state above, the ALJ erred in rejecting Mr. Palencia's testimony. Accordingly, the Court finds that substantial evidence did not support the ALJ's decision. See Mayes v. Massanari, 276 F.3d 453, 458-59 (9th Cir. 2001).
With error established, this Court has discretion to remand or reverse and award benefits. McAllister v. Sullivan, 888 F.2d 599, 603 (9th Cir. 1989).
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. See Benecke v. Barnhart, 379 F.3d 587, 595-96 (9th Cir. 2004). But where there are outstanding issues that must be resolved before a determination can be made, or it is not clear from the record that the ALJ would be required to find plaintiff disabled if all the evidence were properly evaluated, remand is appropriate. See id. at 594.
Here, there are outstanding issues which must be resolved before a final determination can be made. On remand, the ALJ shall reconsider Mr. Palencia's testimony, and either credit it or provide germane reasons for rejecting it.
Based on the foregoing, IT IS ORDERED THAT judgment shall be entered REVERSING the decision of the Commissioner denying benefits and REMANDING the matter for further ...