Fleming v. Commissioner Social Security Administration

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF OREGON

CHRISTOPHER F.,1 No. 6:20-cv-1972-MO

Plaintiff, OPINION & ORDER

v.

COMMISSIONER, SOCIAL

SECURITY ADMINISTRATION,

Defendant.

MOSMAN, District Judge:

This matter comes before me on Plaintiff Christopher F.’s Complaint [ECF 1] against

Defendant Commissioner of the Social Security Administration. For the reasons given below, I

REVERSE the Commissioner’s decision and REMAND this case for further proceedings.

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

the nongovernmental party in this case.

PROCEDURAL BACKGROUND

On December 20, 2018, Plaintiff applied for Supplemental Security Income (“SSI”)

under Title XVI of the Social Security Act, alleging disability beginning October 1, 2014. Tr.

150. The Social Security Administration (“SSA”) denied his claim initially and upon

reconsideration. Tr. 88, 96. Plaintiff appeared and testified at a hearing held on May 7, 2020,

before Administrative Law Judge (ALJ) Robert Frank Spaulding. Tr. 25-50. On May 28, 2020,

the ALJ issued a decision finding that Plaintiff had not been under a disability since December

20, 2018, the date the application was filed. Tr. 10-24. Plaintiff filed an appeal, and the Appeals

Council denied review. Tr. 1-6.

THE ALJ’S FINDINGS

At step one, the ALJ found that Plaintiff had not engaged in substantial gainful activity

(SGA) since December 20, 2018, the application date. Tr. 15. At step two, the ALJ determined

that Plaintiff had the following severe impairments: left rotator cuff tendinitis, and generalized

anxiety disorder. Tr. 15. At step three, the ALJ found no impairment that met or equaled the

severity of any impairment listed in 20 C.F.R. Part 404, Subpart P, Appendix 1. Tr. 16. The ALJ

assessed Plaintiff’s residual functional capacity (“RFC”) to:

perform a range of light work as defined in 20 CFR 416.967(b) except he is

limited to occasional climbing of ladders, ropes, and scaffolds. He can

occasionally stoop and frequently crawl. He can occasionally (not frequently)

reach with the non-dominant left upper extremity. He can understand, remember,

and carry out simple, routine, repetitive tasks with short instructions consistent

with a reasoning level of 2 and unskilled work as defined by the Dictionary of

Occupational Titles (DOT). He can tolerate occasional interaction with coworkers

(defined as brief and casual not requiring coordinated or teamwork). He can

tolerate cursory interaction with the public (defined as casual or perfunctory).

Tr. 17.

At step four, the ALJ determined that Plaintiff had no past relevant work. Tr. 19.

Alternatively, at step five, the ALJ determined that there are jobs that exist in significant

numbers in the national economy that the claimant can perform such groover-and-striper

operator, blending-tank tender helper, and sandwich-board carrier. Tr. 20. The ALJ therefore

found Plaintiff not disabled. Tr. 20.

LEGAL STANDARD

Courts must uphold the ALJ’s decision if it “was supported by substantial evidence and

based on proper legal standards.” Lewis v. Astrue, 498 F.3d 909, 911 (9th Cir. 2007). Substantial

evidence is “more than a mere scintilla,” and means only “such relevant evidence as a reasonable

mind might accept as adequate to support a conclusion.” Biestek v. Berryhill, 139 S. Ct. 1148,

1150 (2019) (internal quotation marks omitted). When “evidence is susceptible of more than one

rational interpretation ... the ALJ’s conclusion ... must be upheld.” Burch v. Barnhart, 400 F.3d

676, 679 (9th Cir. 2005). Errors in the ALJ’s decision do not warrant reversal if they are

harmless. Stout v. Comm’r Soc. Sec. Admin., 454 F.3d 1050, 1054 (9th Cir. 2006).

DISCUSSION

Plaintiff raises just one issue with the ALJ’s decision. Plaintiff argues the ALJ erred by

improperly accepting step five testimony unsupported by substantial evidence.

I. Step Five

At step five of the sequential evaluation analysis, the burden shifts to the Commissioner

to establish that (1) the claimant can perform other work despite her identified limitations, and

that (2) such work “exists in significant numbers in the national economy.” 20 C.F.R. §

416.960(c)(2); Zavalin v. Colvin, 778 F.3d 842, 845 (9th Circ. 2015). In determining if other

suitable work exists that the claimant may be able to perform, the ALJ may rely on the

Dictionary of Occupational Titles (DOT) or testimony from vocational experts (VEs) who testify

about specific occupations that a claimant can perform in light of their RFC. See Zavalin, 778

F.3d at 845–46. While the Ninth Circuit has not established a minimum or bright-line number of

jobs that constitutes a “significant” number, it held in Gutierrez v. Commissioner of Social

Security, 740 F.3d 519, 528–29 (9th Cir. 2014) that 25,000 jobs in the national economy, while a

close call, amounts to a significant number of jobs. The ALJ’s step-five finding, like all findings

under review by the district court, must be supported by substantial evidence in the overall

record to be affirmed. See Bayliss v. Barnhart, 427 F.3d 1211, 1214, n.1 (9th Cir. 2005) (citing

Tidwell v. Apfel, 161 F.3d 599, 601 (9th Cir. 1999)).

When represented by counsel, a claimant must challenge the vocational expert’s numbers

“at some point during administrative proceedings to preserve the challenge on appeal in federal

district court.” Shaibi v. Berryhill, 883 F.3d 1102, 1109 (9th Cir. 2017). A claimant need not

“cross-examine a VE with specific alternative job calculation[s]….” Id. at 1110. If the ALJ

declines to keep the record open to allow a claimant to submit supplemental evidence about the

VE’s job estimates, a claimant may raise that evidence for the first time before the Appeals

Council, provided that the evidence is both relevant and “relates to the period on or before the

ALJ’s decision.” Id. A court must consider “whether there is support for a claimant’s counsel’s

approach in generating job-number estimates in determining whether new evidence is significant

and probative.” White v. Kijakazi, 44 F.4th 828, 836 (9th Cir. 2022) (cleaned up). When a

plaintiff tenders vastly different job numbers from the same source as the VE, remand for the

ALJ to address the inconsistency is warranted. Buck v. Berryhill, 869 F.3d 1040, 1052 (9th Cir.

2017).

Plaintiff argues the ALJ erred at step five by accepting VE testimony about the

availability of jobs in the national economy that was not supported by substantial evidence. Pl.

Br., ECF No. 15 at 12-13. At the hearing, the VE testified that Plaintiff would be able to perform

the occupations of groover-and-striper operator with 20,000 jobs nationally, blending-tank tender

helper with 8,000 jobs nationally, and sandwich-board carrier with 5,000 jobs nationally. Tr. 46-

47. Plaintiff’s counsel asked about the source of the VE’s job numbers at the hearing. Tr. 48. The

VE testified that his numbers came from Job Browser Pro, which derives its numbers from the

Bureau of Labor Statistics. Tr. 48. After the decision, Plaintiff’s representative submitted rebuttal

evidence to the Appeals Council regarding these numbers. Tr. 264-271. The Appeals Council

accepted this evidence as part of the administrative record. Tr. 4. The Court must consider

evidence that the Appeals Council makes part of the administrative record. See Brewes v.

Commissioner of Social Sec. Admin., 682 F.3d 1157, 1163 (9th Cir. 2012) (citation omitted)

(“[W]e hold that when the Appeals Council considers new evidence in deciding whether to

review a decision of the ALJ, that evidence becomes part of the administrative record, which the

district court must consider when reviewing the Commissioner's final decision for substantial

evidence.”).

Plaintiff’s exhibits reflected Job Browser Pro data--the same data cited by the VE--

suggesting that the VE estimated more jobs in each of the three occupations than actually

existed. For the position of Sandwich-Board Carrier, for example, (DOT 299.687-014),

Plaintiff’s exhibit showed 2,428 positions, as opposed to the 5,000 suggested by the VE.

Compare Tr. 266-267 with Tr. 47. For the Blending-Tank Tender Helper position, (DOT

520.687-066), Plaintiff’s exhibit reflected 585 positions nationally, instead of the 8,000 available

per the VE. Compare Tr. 268-269 with Tr. 47. Finally, for the position of Groover-and-Striper

Operator, (DOT 669.685-102), Plaintiff introduced evidence that there were 951 positions

nationally, far less than the 20,000 available jobs suggested by the VE. Compare Tr. 270-271

with Tr. 46. In sum, accepting Plaintiff’s evidence as true, there would be only 3,964 jobs in the

national economy that Plaintiff could perform. See Tr. 266-71. Defendant does not contest that

this evidence was significant and probative, as Plaintiff’s counsel generated it using the same

software and DOT codes as the VE. See White, 44 F.4th at 837 (upholding attorney’s

methodology as “significant and probative” when the attorney “us[ed] [the same database] and

the same DOT codes the VE had used”); see also Def Br. at 2-6 (neglecting to dispute the

significance or probative value of the evidence Plaintiff presented to the Appeals Council).2

Defendant’s only argument that this case should not be remanded for the ALJ to consider

Plaintiff’s conflicting job availability data is that Plaintiff waived the argument by failing to raise

it before the ALJ, instead waiting to submit the information to the Appeals Council.

Plaintiff preserved his argument by questioning the VE during the hearing and then

submitting supplemental evidence to the Appeals Council that challenged the accuracy of the

VE’s job numbers. A disability claimant has the right to submit evidence to the Appeals Council

that was not submitted to the ALJ, provided there is “good cause” for not having submitted the

evidence earlier. 20 C.F.R. § 404.970(b). The Ninth Circuit has held that where an Appeals

Council “considers” a claimant’s evidence and makes his additional evidence “part of the

record,” it “indicat[es] that [claimant] had shown “good cause” under § 404.970(b) in not having

2 If the Appeals Council had credited Plaintiff’s estimates that there were only 3,964 jobs

(counting all three) in the national economy that he could perform, there is a reasonable

probability that the outcome of his proceeding may have been different. See Gutierrez v. Comm'r

of Soc. Sec., 740 F.3d 519, 528–29 (9th Cir. 2014) (holding that 25,000 jobs nationally is a

significant number, but noting that it was a “close call”); see also Beltran v. Astrue, 700 F.3d

386, 390 (9th Cir. 2012) (holding that 1,680 jobs nationally was not significant).

introduced it in the hearing before the ALJ.” White, 44 F.4th at 836-37. Indeed, the Ninth Circuit

has recognized that “a claimant will rarely, if ever, be in a position to anticipate the particular

occupations a VE might list and the corresponding job numbers to which a VE might testify at a

hearing.” Shaibi, 883 F.3d at 1110; see also White, 44 F.4th at 837 (“We recognize that the

claimant in Buck submitted his estimated job numbers to the ALJ, and that [this claimant]

submitted his estimated job numbers to the Appeals Council. This distinction is not fatal.”).

Following the Ninth Circuit’s rule from White, it was appropriate for Plaintiff to submit his

evidence challenging the VE’s job availability numbers for the first time to the Appeals Council.

Defendant does not acknowledge the Ninth Circuit’s holding in White, but instead argues

that Plaintiff forfeited the issue because he did not ask the ALJ for the opportunity to submit

supplemental briefing with evidence contradicting the VE after the hearing. Def. Br., ECF No.

14 at 4-7 (citing Shapiro v. Saul, 833 F. App'x 695, 696 (9th Cir. 2021)). In Shapiro, however,

counsel for the claimant did not seed the ground by questioning the VE about job availability

data during the hearing as Plaintiff’s counsel here did. 833 F. App’x at 696. Shapiro is also

unpublished, and predates the Ninth Circuit’s published decision in White, which established that

seeking leave to file a supplemental brief with the ALJ is not always required. Here, as in White,

the Appeals Council “received additional evidence which it is making part of the record,”--

meaning Plaintiff had good cause for submitting the evidence late--and Plaintiff’s evidence was

significant and probative. Tr. 5; White, 44 F.4th at 837. Plaintiff therefore preserved his

challenge to the VE’s job availability numbers and established good cause to submit new

evidence on appeal. Defendant’s citation to pre-White, unpersuasive, and unpublished Ninth

Circuit case law to the contrary is unavailing.

II. Remand

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, 1210 (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-

100 (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 if 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. If so, the district court

can exercise its discretion to remand for an award of benefits. Id. The district court retains

flexibility, however, and is not required to credit statements as true merely because the ALJ

made a legal error. Id. at 408.

There remain ambiguities and conflicts in the record. The ALJ needs to take evidence

about whether Plaintiff can perform jobs that exist in significant numbers in the national

economy. See Buck, 869 F.3d at 1052 (remanding to address the inconsistency between the

number of jobs presented by the VE and the plaintiff). Thus, the Court remands for further

proceedings so that the ALJ can consider the evidence Plaintiff submitted to the Appeals

Council, and solicit further testimony from the VE about the availability of jobs in the national

economy, if necessary, and to ascertain how these significant miscalculations made their way

into the record.

CONCLUSION

For the reasons given above, I REVERSE the Commissioner’s decision and REMAND

this case for further proceedings.

IT IS SO ORDERED.

DATED: 1/31/2024

Warhash U) VWleaman

MICHAEL W. MOSMAN

United States District Judge

9 — OPINION & ORDER