United States District Court, E.D. California
ORDER
KENDALL J. NEWMAN UNITED STATES MAGISTRATE JUDGE.
Plaintiff
Steven McElvain, proceeding without counsel, seeks judicial
review of a final decision by the Commissioner of Social
Security (“Commissioner”), denying a waiver of
recovery of an overpayment of Disability Insurance Benefits
(“DIB”) under Title II of the Social Security
Act. After the administrative record of the proceedings below
was filed in this court, plaintiff filed a motion for summary
judgment. (ECF No. 11.) The Commissioner opposed that motion
and filed a cross-motion for summary judgment. (ECF No. 16.)
No optional reply brief was filed. After carefully
considering the parties’ written briefing, the record,
and the applicable law, the court DENIES plaintiff’s
motion for summary judgment, GRANTS the Commissioner’s
cross-motion for summary judgment, and AFFIRMS the final
decision of the Commissioner.
The
court reviews the Commissioner’s decision to determine
whether (1) it is based on proper legal standards pursuant to
42 U.S.C. § 405(g), and (2) substantial evidence in the
record as a whole supports it. Tackett v. Apfel, 180
F.3d 1094, 1097 (9th Cir. 1999). Substantial evidence is more
than a mere scintilla, but less than a preponderance.
Connett v. Barnhart, 340 F.3d 871, 873 (9th Cir.
2003) (citation omitted). It means “such relevant
evidence as a reasonable mind might accept as adequate to
support a conclusion.” Orn v. Astrue, 495 F.3d
625, 630 (9th Cir. 2007), quoting Burch v. Barnhart,
400 F.3d 676, 679 (9th Cir. 2005). “The ALJ is
responsible for determining credibility…and resolving
ambiguities.” Edlund v. Massanari, 253 F.3d
1152, 1156 (9th Cir. 2001) (citation omitted). “The
court will uphold the ALJ’s conclusion when the
evidence is susceptible to more than one rational
interpretation.” Tommasetti v. Astrue, 533
F.3d 1035, 1038 (9th Cir. 2008).
Plaintiff,
a registered nurse, began receiving DIB as of May 2009. (AT
13, 40, 42, 179.) Around July 2010, plaintiff returned to
work, but nonetheless continued receiving DIB until February
2013. (AT 29, 38, 142.) On March 5, 2013, the Commissioner
issued a notice informing plaintiff that he was overpaid DIB
in the amount of $32, 478.00 from August 2011 through
February 2013, due to his earnings having exceeded
substantial gainful activity levels during that period. (AT
13, 25-28, 29-31.) Plaintiff’s earnings records confirm
that his income during that period was generally between $4,
000.00 and $7, 000.00 per month, and far exceeded substantial
gainful activity levels. (AT 28.) After a March 18, 2014
hearing, an administrative law judge (“ALJ”)
issued a decision dated May 1, 2014, holding that plaintiff
was overpaid DIB in the amount of $32, 478.00 during the
period from August 2011 through February 2013; that plaintiff
was at fault in causing the overpayment; and that recovery of
the overpayment was not waived. (AT 13-16, 171-90.)
Subsequently, on November 28, 2014, the Appeals Council
denied plaintiff’s request for review, making the
ALJ’s decision the final decision of the Commissioner.
(AT 5-7.)
On
appeal before this court, plaintiff does not dispute the fact
that an overpayment was made, nor does he challenge the
Commissioner’s computation of the amount of that
overpayment. Instead, plaintiff contends that the ALJ erred
in concluding that recovery of the overpayment should not be
waived under applicable law. For the reasons discussed below,
that argument is unpersuasive.
“In
any case in which more than the correct amount of payment has
been made, there shall be no adjustment of payments to, or
recovery by the United States from, any person who is
without fault if such adjustment or recovery would
defeat the purpose of [Title II of the Act] or would be
against equity and good conscience.” 42 U.S.C. §
404(b)(1) (emphasis added); see also 20 C.F.R.
§ 404.506(a). Even though the Commissioner “may
have been at fault in making the overpayment, that fact does
not relieve the overpaid individual…from liability for
repayment if such individual is not without fault.” 20
C.F.R. § 404.507. In determining whether an individual
is “without fault, ” the Commissioner
“shall specifically take into account any physical,
mental, educational, or linguistic limitation such individual
may have (including any lack of facility with the English
language).” 42 U.S.C. § 404(b)(2); see
also 20 C.F.R. § 404.507 (directing the
Commissioner to consider “all pertinent circumstances,
including the individual’s age and intelligence, and
any physical, mental, educational, or linguistic
limitations”). An overpaid individual may be deemed at
fault if he or she accepted a payment which he or she
“either knew or could have been expected to know was
incorrect.” 20 C.F.R. § 404.507. “The
overpaid individual bears the burden of proving that he was
without fault.” McCarthy v. Apfel, 221 F.3d
1119, 1126 (9th Cir. 2000).
In this
case, it is undisputed that the Commissioner was at fault in
making the overpayment. In fact, the Commissioner effectively
concedes that plaintiff notified the Commissioner of his
return to work and accurately reported his earnings, but that
the Commissioner erroneously continued to pay plaintiff DIB
until February 2013. The pertinent question is whether
plaintiff himself had any fault with respect to the
overpayment.
Here,
the ALJ reasonably found that plaintiff was not without
fault, because he accepted payments that he either knew, or
at a minimum, could have been expected to know, were
incorrect. As the ALJ noted, in March 2011, and again in
January 2012, plaintiff was sent the pamphlet regarding
work-related eligibility issues, “Working While
Disabled - How We Can Help.” (AT 15, 118, 146.)
Although the pamphlet generally indicates that income should
be reported to the Commissioner for review of eligibility,
which plaintiff undisputedly did, the pamphlet also makes
clear that benefits should stop if a claimant makes more than
a certain amount per month; for example, $1, 130.00 in 2016.
See
https://www.ssa.gov/pubs/EN-05-10095.pdf.
Additionally, in a letter dated February 9, 2012, the
Commissioner again outlined the amount of monthly earnings
considered to be substantial work, ranging from $980.00 in
2009 to $1, 010.00 in 2012. (AT 69-72.) Given that
plaintiff’s earnings during the relevant period
generally ranged from $4, 000 to $7, 000 per month,
plaintiff, a well-educated registered nurse with no pertinent
mental, cognitive, educational, or linguistic limitations,
knew or should have known that he was not entitled to DIB
during that time. (AT 15.)
Indeed,
as the ALJ observed, plaintiff’s own actions suggested
that plaintiff understood the effect of his work activity on
his eligibility for DIB. (AT 15.) In a December 5, 2011 note,
plaintiff stated: “I have been working full time since
2010. Please, if I am no longer eligible for SSDI, please
stop the benefits.” (AT 142.) Shortly thereafter, in a
December 14, 2011 telephone call with plaintiff, it was noted
that plaintiff had undergone successful heart surgery and had
returned to work: “He is working full-time and
understands that his benefits should stop as he is well over
SGA [substantial gainful activity]. In fact, he wants the
benefits to stop. He also alleged returning the Medicare card
as he is fully insured by his employer.” (AT 17.)
Thereafter, in a February 3, 2012 work activity report,
plaintiff again requested that disability benefits be ceased,
because he had returned to work full time and “no
longer need[ed]” the benefits. (AT 130.) Nevertheless,
plaintiff continued to accept DIB benefits until February
2013 instead of returning them. See Manitsas v.
Astrue, 2012 WL 2503267, at *5 (N.D. Cal. Jun. 28, 2012)
(unpublished) (“The fact that Manitsas accepted the
payments despite her awareness that she was no longer due
benefits substantially supports the ALJ’s conclusion
that she was not ‘without fault’ for the
overpayment of benefits.”).[1]
To be
sure, the court is not unsympathetic to plaintiffs
frustration with the Commissioner’s failure to have
ceased payment of DIB when plaintiff accurately reported his
return to work and earnings. As noted above, there is no
question that the Commissioner was at fault. That said, under
applicable law, the inquiry for purposes of whether recovery
should be waived is focused not on the Commissioner’s
fault, but on whether plaintiff himself
had any fault with respect to the overpayment. Because
substantial evidence supports the ALJ’s finding that
plaintiff accepted payments that he either knew, or at a
minimum, could have been expected to know, were incorrect,
the ALJ reasonably found that plaintiff was not without
fault.[2]
In sum,
the court finds that the ALJ’s decision was free from
prejudicial legal error and supported by substantial evidence
in the record as a whole. Accordingly, IT IS HEREBY ORDERED
that:
1. Plaintiff s motion for summary judgment (ECF No. 11) is
DENIED.
2. The Commissioner’s cross-motion for summary judgment
(ECF No. 16) is GRANTED.
3. The final decision of the Commissioner of Social Security
is AFFIRMED, and judgment is ...