Lewis v. Commissioner Social Security Administration

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF OREGON

TREASURE L.1, Case No. 6:19-cv-583-SI

Plaintiff, OPINION AND ORDER

v.

ANDREW M. SAUL, Commissioner of

Social Security,

Defendant.

Ari D. Halpern, HALPERN LAW GROUP PC, 62910 O.B. Riley Road, Suite 100, Bend, OR 97703.

Of Attorneys for Plaintiff.

Billy J. Williams, United States Attorney, and Renata Gowie, Assistant United States Attorney,

UNITED STATES ATTORNEY’S OFFICE, 1000 SW Third Avenue, Suite 600, Portland, OR 97204;

Lisa Goldoftas, Special Assistant United States Attorney, OFFICE OF GENERAL COUNSEL, Social

Security Administration, 701 Fifth Avenue, Suite 2900 M/S 221A, Seattle, WA 98104. Of

Attorneys for Defendant.

Michael H. Simon, District Judge.

Treasure L. (“Plaintiff”) seeks judicial review of the final decision of the Commissioner

of the Social Security Administration (“Commissioner”) denying her application for disability

1 In the interest of privacy, this opinion uses only the first name and the initial of the last

name of the non-governmental party in this case. When applicable, this opinion uses the same

designation for a non-governmental party’s immediate family member.

insurance benefits (“DIB”). In response, the Commissioner conceded error and moved for an

order remanding for further administrative proceedings to consider additional evidence that

Plaintiff submitted after the administrative hearing. Plaintiff replied, arguing that the Court

should remand this case for a finding of disability and the payment of benefits. For the reasons

stated below, the Court remands for a finding of disability and the immediate payment of

benefits.

STANDARD OF REVIEW

The district court must affirm the Commissioner’s decision if it is based on the proper

legal standards and the findings are supported by substantial evidence. 42 U.S.C. § 405(g); see

also Hammock v. Bowen, 879 F.2d 498, 501 (9th Cir. 1989). “Substantial evidence” means

“more than a mere scintilla but less than a preponderance.” Bray v. Comm’r of Soc. Sec.

Admin., 554 F.3d 1219, 1222 (9th Cir. 2009) (quoting Andrews v. Shalala, 53 F.3d 1035, 1039

(9th Cir. 1995)). It means “such relevant evidence as a reasonable mind might accept as adequate

to support a conclusion.” Id. (quoting Andrews, 53 F.3d at 1039).

When the evidence is susceptible to more than one rational interpretation, the

Commissioner’s conclusion must be upheld. Burch v. Barnhart, 400 F.3d 676, 679 (9th

Cir. 2005). Variable interpretations of the evidence are insignificant if the Commissioner’s

interpretation is a rational reading of the record, and this Court may not substitute its judgment

for that of the Commissioner. See Batson v. Comm’r of Soc. Sec. Admin., 359 F.3d 1190, 1193,

1196 (9th Cir. 2004). “[A] reviewing court must consider the entire record as a whole and may

not affirm simply by isolating a specific quantum of supporting evidence.” Orn v. Astrue, 495

F.3d 625, 630 (9th Cir. 2007) (quoting Robbins v. Soc. Sec. Admin., 466 F.3d 880, 882 (9th

Cir. 2006) (quotation marks omitted)). A reviewing court, however, may not affirm the

Commissioner on a ground upon which the Commissioner did not rely. Id.; see also Bray, 554

F.3d at 1226.

BACKGROUND

A. Plaintiff’s Application

Plaintiff applied for DIB in August 2015, alleging disability beginning June 15, 2015.

AR 201. Plaintiff was born on March 10, 1971 and was 44 years old as of the alleged disability

onset. Id. The agency denied her claim both initially and upon reconsideration, and Plaintiff

requested a hearing. AR 92-101, 104-115. Plaintiff appeared for a hearing by videoconference

before an Administrative Law Judge (“ALJ”) in October 2017. AR 65-92. On February 28, 2018,

the ALJ issued a decision denying Plaintiff’s claim for benefits. AR 47-64. Plaintiff requested

review of the hearing decision, which the Appeals Council denied in February 2019. AR 1.

Accordingly, the ALJ’s decision became the final decision of the agency. Plaintiff seeks judicial

review of the agency’s final decision.

B. The Sequential Analysis

A claimant is disabled if he or she is unable to “engage in any substantial gainful activity

by reason of any medically determinable physical or mental impairment which . . . has lasted or

can be expected to last for a continuous period of not less than 12 months[.]” 42 U.S.C.

§ 423(d)(1)(A). “Social Security Regulations set out a five-step sequential process for

determining whether an applicant is disabled within the meaning of the Social Security Act.”

Keyser v. Comm’r Soc. Sec. Admin., 648 F.3d 721, 724 (9th Cir. 2011); see also 20 C.F.R.

§§ 404.1520 (DIB), 416.920 (SSI); Bowen v. Yuckert, 482 U.S. 137, 140 (1987). Each step is

potentially dispositive. 20 C.F.R. §§ 404.1520(a)(4), 416.920(a)(4). The five-step sequential

process asks the following series of questions:

1. Is the claimant performing “substantial gainful activity?” 20 C.F.R.

§§ 404.1520(a)(4)(i), 416.920(a)(4)(i). This activity is work involving

significant mental or physical duties done or intended to be done for pay

or profit. 20 C.F.R. §§ 404.1510, 416.910. If the claimant is performing

such work, she is not disabled within the meaning of the Act. 20 C.F.R.

§§ 404.1520(a)(4)(i), 416.920(a)(4)(i). If the claimant is not performing

substantial gainful activity, the analysis proceeds to step two.

2. Is the claimant’s impairment “severe” under the Commissioner’s

regulations? 20 C.F.R. §§ 404.1520(a)(4)(ii), 416.920(a)(4)(ii). An

impairment or combination of impairments is “severe” if it significantly

limits the claimant’s physical or mental ability to do basic work activities.

20 C.F.R. §§ 404.1521(a), 416.921(a). Unless expected to result in death,

this impairment must have lasted or be expected to last for a continuous

period of at least 12 months. 20 C.F.R. §§ 404.1509, 416.909. If the

claimant does not have a severe impairment, the analysis ends. 20 C.F.R.

§§ 404.1520(a)(4)(ii), 416.920(a)(4)(ii). If the claimant has a severe

impairment, the analysis proceeds to step three.

3. Does the claimant’s severe impairment “meet or equal” one or more of the

impairments listed in 20 C.F.R. Part 404, Subpart P, Appendix 1? If so,

then the claimant is disabled. 20 C.F.R. §§ 404.1520(a)(4)(iii),

416.920(a)(4)(iii). If the impairment does not meet or equal one or more of

the listed impairments, the analysis continues. At that point, the ALJ must

evaluate medical and other relevant evidence to assess and determine the

claimant’s “residual functional capacity” (“RFC”). This is an assessment

of work-related activities that the claimant may still perform on a regular

and continuing basis, despite any limitations imposed by his or her

impairments. 20 C.F.R. §§ 404.1520(e), 404.1545(b)-(c), 416.920(e),

416.945(b)-(c). After the ALJ determines the claimant’s RFC, the analysis

proceeds to step four.

4. Can the claimant perform his or her “past relevant work” with this RFC

assessment? If so, then the claimant is not disabled. 20 C.F.R.

§§ 404.1520(a)(4)(iv), 416.920(a)(4)(iv). If the claimant cannot perform

his or her past relevant work, the analysis proceeds to step five.

5. Considering the claimant’s RFC and age, education, and work experience,

is the claimant able to make an adjustment to other work that exists in

significant numbers in the national economy? If so, then the claimant is

not disabled. 20 C.F.R. §§ 404.1520(a)(4)(v), 416.920(a)(4)(v),

404.1560(c), 416.960(c). If the claimant cannot perform such work, he or

she is disabled. Id.

See also Bustamante v. Massanari, 262 F.3d 949, 954 (9th Cir. 2001).

The claimant bears the burden of proof at steps one through four. Id. at 953; see also

Tackett v. Apfel, 180 F.3d 1094, 1098 (9th Cir. 1999); Yuckert, 482 U.S. at 140-41. The

Commissioner bears the burden of proof at step five. Tackett, 180 F.3d at 1100. At step five, the

Commissioner must show that the claimant can perform other work that exists in significant

numbers in the national economy, “taking into consideration the claimant’s residual functional

capacity, age, education, and work experience.” Id.; see also 20 C.F.R. §§ 404.1566, 416.966

(describing “work which exists in the national economy”). If the Commissioner fails to meet this

burden, the claimant is disabled. 20 C.F.R. §§ 404.1520(a)(4)(v), 416.920(a)(4)(v). If, however,

the Commissioner proves that the claimant is able to perform other work existing in significant

numbers in the national economy, the claimant is not disabled. Bustamante, 262 F.3d at 953-54;

Tackett, 180 F.3d at 1099.

C. The ALJ’s Decision

The ALJ found that Plaintiff met the insured status requirements of the Social Security

Act (“Act”) through December 31, 2020 and proceeded to the sequential analysis. AR 52. At step

one, the ALJ found that Plaintiff had not engaged in substantial gainful activity since the alleged

onset date of June 15, 2015. Id. At step two, the ALJ determined that Plaintiff suffered from two

severe impairments: multiple sclerosis (“MS”) and migraines. Id. At step three, the ALJ found

that Plaintiff’s impairments did not meet or medically equal the severity a listed impairment. Id.

The ALJ reasoned that Plaintiff did not show any alteration of consciousness and thus did not

meet any of the 11.00 listings for seizure disorders. The ALJ stated that Plaintiff did not meet

either of the 11.09 listings for MS because she did not have “disorganization of motor function

of any extremity” and “only complained of minor hand tremors.” AR 53. Between step three and

step four, the ALJ formulated Plaintiff’s RFC. The ALJ determined that Plaintiff could

perform sedentary work as defined in 20 CFR 404.1567(a) except

she can only occasionally balance, stoop, crouch, kneel, and crawl

and never climb ladders, ropes and scaffolds. She can have no

exposure to hazards such as machinery and unprotected heights.

AR 53. At step four, the ALJ found that Plaintiff could perform her past relevant work as an

educational consultant. AR 56. In the alternative, at step five the ALJ found that “there are other

jobs that exist in significant numbers in the national economy that [Plaintiff] also can perform.”

AR 57. Thus, the ALJ concluded that Plaintiff is not disabled.

DISCUSSION

Plaintiff alleges that the ALJ erred by: (1) finding that Plaintiff did not meet or equal any

of the presumptively disabling listings at step three; (2) improperly rejecting the medical opinion

testimony of Dr. Laura Schaben; (3) improperly rejecting Plaintiff’s subjective symptom

testimony; and (4) improperly rejecting the lay witness testimony of Plaintiff’s husband. Because

issue (2) is dispositive, the Court does not address issues (1), (3), and (4). Plaintiff also submitted

Dr. Schaben’s notes from their telephone encounters and a letter from Dr. Schaben (together, the

“post-hearing evidence,” AR 13-46) to the Appeals Council. The Commissioner agrees that

remand is warranted but concedes no specific error and argues that the Court should permit the

ALJ to “reevaluate the entire case” in light of new evidence submitted by Plaintiff after the

administrative hearing but before the Appeals Council rejected Plaintiff’s request for review.

ECF 18 at 2.

That is the Commissioner’s argument, despite Ninth Circuit precedent holding that

remanding for further proceedings under these circumstances “would create an unfair ‘heads we

win; tails, let's play again’ system of disability benefits adjudication.” Benecke v. Barnhart, 379

F.3d 587, 595 (9th Cir. 2004) The Court identifies the ALJ’s material legal error and then

explains why remand for immediate payment of benefits is appropriate.

A. “Credit-as-True” Framework

Within the Court’s discretion under 42 U.S.C. § 405(g) is the “decision whether to

remand for further proceedings or for an award of benefits.” Holohan v. Massanari, 246 F.3d

1195, 1202 (9th Cir. 2001) (citation omitted). Although a court should generally remand to the

agency for additional investigation or explanation, a court has discretion to remand for

immediate payment of benefits. Treichler v. Comm’r of Soc. Sec. Admin., 775 F.3d 1090, 1099-

1100 (9th Cir. 2014). The issue turns on the utility of further proceedings. A court may not award

benefits punitively and must conduct a “credit-as-true” analysis on evidence that has been

improperly rejected by the ALJ to determine whether a claimant is disabled under the Social

Security Act. Strauss v. Comm’r of the Soc. Sec. Admin., 635 F.3d 1135, 1138 (9th Cir. 2011).

In the Ninth Circuit, the “credit-as-true” doctrine is “settled” and binding on this

Court. Garrison v. Colvin, 759 F.3d 995, 999 (9th Cir. 2014). The court first determines whether

the ALJ made a legal error and then reviews the record as a whole to determine whether the

record is fully developed, the record is free from conflicts and ambiguities, and there is any

useful purpose in further proceedings. Dominguez v. Colvin, 808 F.3d 403, 407 (9th Cir. 2015).

Only if the record has been fully developed and there are no outstanding issues left to be

resolved does the district court consider whether the ALJ would be required to find the claimant

disabled on remand if the improperly discredited evidence were credited as true. Id. Said

otherwise,

the district court must consider the testimony or opinion that the

ALJ improperly rejected, in the context of the otherwise undisputed

record, and determine whether the ALJ would necessarily have to

conclude that the claimant were disabled if that testimony or

opinion were deemed true.

Id. (emphasis added). If so, the district court can exercise its discretion to remand for an award of

benefits. Id. The district court retains flexibility, however, and need not credit statements as true

merely because the ALJ made a legal error. Id. at 408.

B. Analysis

1. The ALJ Committed Harmful Legal Error by Improperly Rejecting the Medical

Source Opinion of Dr. Schaben

The ALJ is responsible for resolving conflicts in the medical record, including conflicts

among physicians’ opinions. Carmickle, 533 F.3d at 1164. The Ninth Circuit distinguishes

between the opinions of three types of physicians: treating physicians, examining physicians, and

non-examining physicians. Garrison, 759 F.3d at 1012. Generally, “a treating physician’s

opinion carries more weight than an examining physician’s, and an examining physician’s

opinion carries more weight than a reviewing physician’s.” Holohan, 246 F.3d at 1202. If a

treating physician’s opinion is supported by medically acceptable techniques and is not

inconsistent with other substantial evidence in the record, the treating physician’s opinion is

given controlling weight. Id.; see also 20 C.F.R. § 404.1527(d)(2). A treating doctor’s opinion

that is not contradicted by the opinion of another physician can be rejected only for “clear and

convincing” reasons. Ryan v. Comm’r of Soc. Sec., 528 F.3d 1194, 1198 (9th Cir. 2008). If a

treating doctor’s opinion is contradicted by the opinion of another physician, the ALJ must

provide “specific and legitimate reasons” for discrediting the treating doctor’s opinion. Id.

Specific, legitimate reasons for rejecting a physician’s opinion may include its reliance

on a claimant’s discredited subjective complaints, inconsistency with medical records,

inconsistency with a claimant’s testimony, inconsistency with a claimant’s daily activities, or

that the opinion is brief, conclusory, and inadequately supported by clinical findings. Bray, 554

F.3d at 1228; Tommasetti v. Astrue, 533 F.3d 1035, 1040 (9th Cir. 2008); Andrews, 53 F.3d

at 1042-43. An ALJ errs by rejecting or assigning minimal weight to a medical opinion “while

doing nothing more than ignoring it, asserting without explanation that another medical opinion

is more persuasive, or criticizing it with boilerplate language that fails to offer a substantive

basis” for the ALJ’s conclusion. Garrison¸ 759 F.3d at 1013; see also Smolen v. Chater, 80 F.3d

1273, 1286 (9th Cir. 1996) (noting that an ALJ effectively rejects an opinion when he or she

ignores it).

“An ALJ can satisfy the ‘substantial evidence’ requirement by ‘setting out a detailed and

thorough summary of the facts and conflicting clinical evidence, stating his interpretation

thereof, and making findings.” Garrison, 759 F.3d at 1012 (quoting Reddick v. Chater, 157 F.3d

715, 722 (9th Cir. 1998)). In other words, “[t]he ALJ must do more than offer his conclusions.

He must set forth his own interpretations and explain why they, rather than the doctors’, are

correct.” Reddick, 157 F.3d at 725 (citing Embrey v. Bowen, 849 F.2d 418, 421-22 (9th Cir.

1988)). “[T]he opinion of a non-examining medical advisor cannot by itself constitute substantial

evidence that justifies the rejection of the opinion of an examining or treating physician.”

Morgan v. Comm’r of Soc. Sec. Admin., 169 F.3d 595, 602 (9th Cir. 1999) (citations omitted);

but see id. at 600 (opinions of non-treating or nonexamining physicians may serve as substantial

evidence when the opinions are consistent with independent clinical findings or other evidence in

the record).

Dr. Schaben was one of Plaintiff’s treating physicians and saw Plaintiff every three to six

months since they first started meeting in June 2011. AR 514. Dr. Schaben provided a medical

source opinion in July 2016 and an update in September 2017. In her July 2016 opinion,

Dr. Schaben listed Plaintiff’s extensive symptoms: intention tremor, chronic fatigue, muscle

fatigue, muscle spasticity, numbness, and difficulty concentrating. Id. Dr. Schaben noted that

Plaintiff suffers from “significant reproducible fatigue of motor function with substantial

weakness on repetitive activity, demonstrated on physical examination, resulting from

neurological dysfunction in areas of the central nervous system known to be pathologically

involved in the multiple sclerosis process.” AR 515. Dr. Schaben also translated these clinical

findings into functional limitations. She opined that Plaintiff could rarely lift ten pounds and

could lift less than ten pounds only on occasion. AR 516. Dr. Schaben estimated that Plaintiff’s

symptoms would cause her to miss more than four days of work each month, and that Plaintiff

would require unscheduled breaks every one to two hours. AR 516-17. In September 2017, Dr.

Schaben noted that Plaintiff’s symptoms had gotten “slightly worse” since July 2016. AR 568.

The ALJ rejected Dr. Schaben’s medical opinion because there were “few objective

findings supporting weakness, tremors, etc. that would support such extreme limitations and Dr.

Schaben actually saw [Plaintiff] rarely during the period at issue.” AR 55. Because Dr. Schaben

is a treating physician, the question is whether these are “specific and legitimate” reasons to

discredit Dr. Schaben’s opinion. Ryan, 528 F.3d at 1198.

An ALJ may reject the opinion of a treating physician if it is “brief, conclusory, and

inadequately supported by clinical findings.” Bray, 554 F.3d at 1228. That is not the case with

Dr. Schaben’s medical source opinion. A physician’s reports should show how a claimant’s

symptoms translate into specific functional deficits which preclude certain activities. Morgan,

169 F.3d at 601. That is exactly what Dr. Schaben’s medical source opinion here achieves. See

AR 516-17. Dr. Schaben first described Plaintiff’s clinical signs and symptoms and then

translated them into what Plaintiff “[could] still do despite impairments(s) and [her] physical or

mental restrictions.” 20 C.F.R. §§ 404.1527(a)(2), 416.927(a)(2) (defining medical source

opinion).

Dr. Schaben supported her opinion with clinical findings. Clinical findings are not just

laboratory results and MRIs, but also clinical signs— “abnormalities which can be observed,”

unlike subjective statements about a claimant’s description of an impairment, which are

symptoms. 20 C.F.R. §§ 404.1528, 416.928. In her July 2016 evaluation, Dr. Schaben observed

that Plaintiff suffered from intention tremor, muscle spasticity, and increased deep reflexes,

among other clinical signs. AR 514. Even absent these clinical findings, Plaintiff correctly points

out that “[m]erely to state that a medical opinion is not supported by enough objective findings

does not achieve the level of specificity” necessary to reject that medical opinion. Rodriguez v.

Bowen, 876 F.2d 759, 762-63 (9th Cir. 1989). Dr. Schaben also properly supported her medical

opinion with Plaintiff’s subjective complaints. See Ryan, 528 F.3d at 1199 (“[A]n ALJ does not

provide clear and convincing reasons for rejecting an examining physician’s opinion by

questioning the credibility of the patient’s complaints where the doctor does not discredit those

complaints and supports his ultimate opinion with his own observations.”). Thus, the ALJ did not

provide specific and legitimate reasons and erred by rejecting Dr. Schaben’s medical source

opinion.

In the alternative, as discussed below, the Court properly considers the post-hearing

evidence in determining whether the ALJ committed harmful legal error. Although it is unneeded

to reach that conclusion, the post-hearing evidence further supports the Court’s conclusion that

the ALJ’s decision is not supported by substantial evidence. For example, the ALJ erroneously

noted that “Dr. Schaben actually saw [Plaintiff] rarely during the period at issue,” even though

Dr. Schaben saw Plaintiff about every six months. AR 55. In the post-hearing evidence, Dr.

Schaben explained that visit frequency “is no indication of the severity of [Plaintiff’s]

limitations” and that a visit every six months is the “typical visit schedule” for all Dr. Schaben’s

MS patients, “including those who are already deemed disabled.” AR 13.

2. The Record is Fully Developed and Free from Conflicts and Ambiguities

The Commissioner argues that the record contains conflicts and ambiguities and that

further proceedings would permit the ALJ to “reevaluate the entire case” given the post-hearing

evidence. ECF 18 at 2. Plaintiff argues that the record—viewed both with and without the post-

hearing evidence—is free from conflicts and ambiguities. Plaintiff also argues that remanding to

the ALJ would be improper because the record is already complete—the Appeals Council

considered the post-hearing evidence and incorporated it into the administrative record. The

Court agrees with Plaintiff on each point.

a. The Administrative Record is Complete

The Appeals Council considered the post-hearing evidence but declined to review

Plaintiff’s case because the post-hearing evidence did “not show a reasonable probability that it

would change the outcome of the decision.” AR 2. It defies logic to remand for consideration of

evidence that the Appeals Council itself found immaterial. If the Appeals Council wanted the

ALJ to consider the post-hearing evidence, it “could have remanded for a further hearing so that

the ALJ . . . could take further evidence.” Ramirez v. Shalala, 8 F.3d 1449, 1455 (9th Cir. 1993)

Yet “[i]t chose not to do so.” Id.

Although the ALJ declined to review Plaintiff’s case based on the post-hearing evidence,

this Court properly considers the post-hearing evidence in reviewing the ALJ’s decision. The

Ninth Circuit has held “that when a claimant submits evidence for the first time to the Appeals

Council, which considers that evidence in denying review of the ALJ’s decision, the new

evidence is part of the administrative record, which the district court must consider in

determining whether the Commissioner’s decision is supported by substantial evidence.” Brewes

v. Comm’r of Soc. Sec. Admin., 682 F.3d 1157, 1159-60 (9th Cir. 2012).” That is exactly what

happened in Plaintiff’s case. Plaintiff’s attorney submitted for the first time the post-hearing

evidence to the Appeals Council along with a “good cause” letter explaining why it was not

submitted earlier.2 AR 358-59. The record shows that the Appeals Council accepted and

considered the post-hearing evidence because the Appeals Council did not send Plaintiff notice

explaining why it did not accept the evidence. See 20 C.F.R. § 404.970(c) (explaining that the

Appeals Council will send a notice to the claimant explaining why it did not consider additional

evidence). And after accepting the post-hearing evidence and considering it, the Appeals Council

still declined to review Plaintiff’s case. AR 2. The post-hearing evidence is “part of the

administrative record” and this Court “must consider [it] in determining whether the

Commissioner’s decision is supported by substantial evidence.” Brewes, 682 F.3d at 1159-60.

Thus, even though the ALJ did not consider the post-hearing evidence, the Court finds that the

administrative record is complete.

b. The Administrative Record is Free from Conflicts and Ambiguities

The Commissioner asserts that “outstanding issues must be resolved, and further

administrative proceedings would be useful for evaluating Plaintiff’s impairments and limitations

with the record supplemented by Plaintiff after the ALJ issued a decision.” ECF 18 at 7. But the

Court finds that the record is free of conflicts and ambiguities and that there are no outstanding

issues to resolve. Dominguez, 808 at 407. Further proceedings would not be useful because the

post-hearing evidence does not contradict the record that was before the ALJ—it strengthens

2 The Commissioner’s argument that Plaintiff violated the “five-day rule” is unavailing.

The ALJ herself found that Plaintiff complied with the “five-day rule,” AR 50, and the Court

agrees that Plaintiff made “every effort to ensure that the ALJ receive[d] all of the evidence . . .

no later than 5 business days before the date of the scheduled hearing,” 20 C.F.R. § 404.935(a)).

Plaintiff’s case. The Commissioner fails to explain how the post-hearing evidence affects, to

Plaintiff’s detriment, the analysis of the other evidence in the record.

The Commissioner argues that Plaintiff’s subjective symptom testimony is inconsistent

with her history of travel and her activities of daily living. The Court disagrees. The ALJ

acknowledged that “travel/vacationing and a disability are not necessarily mutually exclusive,”

but without support concluded that Plaintiff’s travel “tends to suggest that the alleged symptoms

and limitations may have been overstated.” AR 54. The only conflict here is in the ALJ’s own

reasoning. Indeed, a person “does not need to be ‘utterly incapacitated’ in order to be disabled.”

Vertigan v. Halter, 260 F.3d 1044, 1050 (9th Cir. 2001) (quoting Fair v. Bowen, 885 F.2d 597,

603 (9th Cir. 1989)). That distinction is especially relevant here because Plaintiff suffers from

MS with intermittent flare-ups. AR 515, a condition characterized by “[c]ycles of improvement

and debilitating symptoms.” Garrison, 759 F.3d at 1017 (citation omitted). Thus, “a few isolated

instances of improvement over a period of months or years” are fully consistent with Plaintiff’s

subjective symptom testimony.3 Id.

The Commissioner also echoes the ALJ’s argument that the testimony of Dr. Rack, a

reviewing physician who testified at the administrative hearing, is “quite equivocal” about

Plaintiff’s level of functioning. ECF 18 at 5. That argument mischaracterizes Dr. Rack’s

testimony to cast it as ambiguous, when it is quite unequivocal. Dr. Rack testified that Plaintiff

“has the remitting and exacerbating type” of MS and “that her illness has gone on over a long

enough period of time that it has rendered her, because of the illness, with symptomatology and

findings that are disabling in nature.” AR 82. Consistent with Plaintiff’s subjective symptom

testimony and the medical source opinion of Dr. Schaben, Dr. Rack agreed that during flare-ups,

3 For the same reason, there is no conflict between Plaintiff’s subjective symptom

testimony and the lay witness testimony of Plaintiff’s husband.

Plaintiff might need to lie down to rest for up to three or four hours each day. AR 85. Thus, Dr.

Rack’s testimony is free of ambiguities and does not conflict with the other record evidence.

3. The Record Requires a Finding of Disability

When the Court credits Dr. Schaben’s improperly rejected medical opinion testimony, a

finding of disability is required at both step three and step five. The Court also briefly considers

the post-hearing evidence and finds that it supports finding disability at step three and step five.

See Brewes, 682 F.3d at 1159-60 (holding that the district court properly considers evidence

submitted to the Appeals Council even when the Appeals Council declines to review the

plaintiff’s case).

a. At Step Three

At step three of the sequential evaluation process, the ALJ must consider whether a

claimant’s severe impairments, either separately or in combination, meet or equal one of the

presumptively disabling impairments listed in the regulations. 20 C.F.R. § 404.1520(a)(4)(iii);

see 20 C.F.R. Part 404, Subpart P, App. 1. To demonstrate that a claimant’s impairment is the

medical equivalent of one of the listed impairments, the claimant must present medical findings

equal in severity to all the criteria of a listing. Sullivan v. Zebley, 493 U.S. 521, 531 (1990)

(emphasis omitted); see also Kennedy v. Colvin, 738 F.3d 1172, 1176 (9th Cir. 2013). To meet or

equal Listing § 11.09 for MS, Plaintiff must demonstrate “[d]isorganization of motor function in

two extremities . . . resulting in an extreme limitation . . . in the ability to stand up from a seated

position, balance while standing or walking, or use the upper extremities” or “marked limitation

in physical functioning” together with marked limitation in one of the following areas:

“understanding, remembering, or applying information,” “interacting with others,”

“concentrating, persisting, or maintaining pace,” and “adapting or managing oneself.” 20 C.F.R.

Part 404, Subpart P, App. 1, § 11.09 (describing Listings 11.09A and 11.09B, respectively).

The ALJ found that Plaintiff “does not have an impairment or combination of

impairments that meets or medically equals the severity of' one of the listed impairments in 20

CFR Part 404, Subpart P, App. 1.” AR 52. The ALJ found that Plaintiff does not meet

Listing 11.09A or Listing 11.09B because Plaintiff provides no evidence of “disorganization of

motor function in any extremity.” AR 53. The ALJ also stated that Plaintiff has only complained

of “minor hand tremors” and that “there is also no indication that [Plaintiff] has marked

difficulty with the [11.09B] criteria.” Id. Plaintiff contends that the ALJ’s step three finding is

not supported by substantial evidence and that Plaintiff meets all the requirements of

Listings 11.09A and 11.09B.

When fully credited, Dr. Schaben’s improperly rejected medical source opinion shows

that Plaintiff meets or medically equals Listing 11.09B. Remand for immediate payment of

benefits is the proper outcome. See Lester v. Chater, 81 F.3d 821,834 (9th Cir.1995) (awarding

benefits when improperly rejected evidence, when credited, establishes that a claimant meets or

equals one of the listed impairments). In her medical source statement Dr. Schaben noted that

Plaintiff does not “have significant and persistent disorganization of motor function in two

extremities,” which precludes a finding that Plaintiff meets Listing 11.09A. Yet Dr. Schaben

opined that Plaintiff suffers from marked limitations in both “physical functioning” and

“concentrating, persisting, or maintaining pace,” thus satisfying Listing 11.09B.

A “marked” limitation in physical functioning is one that would seriously limit Plaintiff’s

ability “to independently initiate, sustain, and complete work-related physical activities.” 20

C.F.R. Part 404, Subpart P, App. 1, § 11.00G2. Plaintiff “need not be totally precluded from

performing a function or activity to have a marked limitation.” Id. Section 11.02G2 lists

“standing” and “walking” as two examples of work-related physical activities. Dr. Schaben

opined that Plaintiff, because of her MS, could stand for only 15 minutes at a time and could

walk for only two city blocks “without rest or severe pain.” AR 515. That qualifies as a marked

limitation in physical functioning. A “marked” limitation in mental functioning is one that

seriously limits Plaintiff’s “ability to function independently, appropriately, effectively, and on a

sustained basis in work settings.” 20 C.F.R. Part 404, Subpart P, App. 1, § 11.00G2.

Section 11.00G3b(iii) lists “concentrating, persisting, or maintaining pace” as an example of an

area of mental functioning. C.F.R. Part 404, Subpart P, App. 1, § 11.00G3. Dr. Schaben opined

that Plaintiff’s MS symptoms “would interfere with attention and concentration needed to

perform even simple work tasks” for 25 percent or more of each typical workday. AR 517. That

qualifies as a marked limitation in mental functioning. Plaintiff meets Listing 11.09B. The post-

hearing evidence further confirms that Plaintiff meets Listing 11.09B. For example, Dr. Schaben

opined that Plaintiff’s “fatigue . . . [has] clearly caused her to be unable to sustain full time work

since she stopped working in 2015.” AR 14.

b. At Step Five

Alternatively, crediting Dr. Schaben’s medical source opinion leads to a finding of

disability at step five. Dr. Schaben wrote that Plaintiff would, as a result of her MS, miss more

than four days of work each month. AR 517. At the administrative hearing, the Vocational

Expert (“VE”) testified that somebody who missed more than one day of work per month on a

regular basis would not be able to maintain full-time employment. AR 89. Dr. Schaben also

wrote that Plaintiff could stand and walk for a maximum of two hours each day and sit for a

maximum of four hours each day. AR 515-16. The VE also testified that somebody with these

mobility limitations would not be able to maintain full-time employment. AR 89.

4. Whether There Is Serious Doubt as to Plaintiff’s Disability

The Commissioner, however, argues that the record creates serious doubt that Plaintiff is

in fact disabled. See Garrison, 759 F.3d at 1021. “Serious doubt” may exist when “the

government has pointed to evidence in the record that the ALJ overlooked and explained how

that evidence casts into serious doubt the claimant’s claim to be disabled,” even if the ALJ did

not consider that evidence at the hearing. Dominguez, 808 F.3d at 407 (quoting Burrell v. Colvin,

775 F.3d 1133, 1141 (9th Cir. 2014)). The only additional evidence here—the telephone

encounter notes and the letter from Dr. Schaben—supports Plaintiff’s disability claim. Thus, the

record does not create “serious doubt” about whether Plaintiff is disabled.

CONCLUSION

The Commissioner’s decision that Plaintiff was not disabled is REVERSED AND

REMANDED for an immediate calculation and payment of benefits.

IT IS SO ORDERED.

DATED this 5th day of June, 2020.

/s/ Michael H. Simon

Michael H. Simon

United States District Judge