The opinion
IN THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
OTIS BROWN, )
)
) 2:19-cv-01590
Plaintiff, )
)
VS. )
)
ANDREW SAUL, COMMISSIONER OF )
SOCIAL SECURITY,
)
Defendant. )
MEMORANDUM OPINION AND ORDER
Plaintiff Otis Brown (“Brown”) commenced this action against Andrew Saul, the
Commissioner of Social Security (“Commissioner”) in which he seeks judicial review of an
unfavorable decision regarding his claim for social security disability benefits and supplemental
security income. Both parties have moved for summary judgment, and both motions have been
fully briefed. On September 21, 2020, the Court issued an order (ECF No. 23), directing the parties
to file supplemental briefs that address the decisions of Lucia v. SEC, 138 S. Ct. 2044 (2018) and
Cirko on behalf of Cirko v. Commissioner of Social Security, 948 F.3d 148 (3d Cir. 2020) as they
may relate to this action. Both parties have done so. (ECF Nos. 25, 27.)
For the reasons set forth below, the Court will grant summary judgment in favor of Brown
and remand this matter for a new hearing before a different administrative law judge.
I. Relevant Procedural and Factual Background
Brown filed applications for supplemental security income and disability benefits on May
18, 2016. (R. 166-78.)! His claims were initially denied on September 1, 2016. (R. 93-103.) He
then took an appeal in which he sought a hearing before an Administrative Law Judge (“ALJ”).
1 Citations to the record (ECF No. 6) are referred to as “R.”
(R. 106-07.) A hearing was held on June 20, 2018 before ALJ Paul Kovac (R. 42-72), who
subsequently issued an unfavorable decision on October 11, 2018, finding that Brown not disabled
under the Social Security Act. (R. 12-24.) Thereafter, he filed a request for review of hearing
decision/order to the Appeals Council. (R. 9-11.) When the Appeals Council denied review on
October 9, 2019, it stated as follows:
Your representative raised a challenge under the Appointments Clause of the
Constitution, U.S. Const. Art. II, § 2, cl. 2, to the manner in which the
Administrative Law Judge was appointed. However, this claim lacks merit because,
on July 16, 2018, the Acting Commissioner of Social Security ratified the
Administrative Law Judge’s appointment and approved it as her own under the
Constitution.
(R. 3. Brown then filed the present action seeking judicial review of the denial of benefits.
In Brown’s Motion for Summary Judgment, he raises a series of errors by the ALJ as bases
for the reversal of his decision. He did not raise an Appointments Clause issue or address the Lucia
or Cirko decisions in his motion for summary judgment.
II. Discussion
In Lucia v. SEC, 138 S. Ct. 2044, 2053 (2018), the United States Supreme Court held that
because the ALJs of the Securities and Exchange Commission are “Officers of the United States”
within the meaning of the Appointments Clause of the United States Constitution, Art. I], § 2., cl.
2, they are required to be appointed to their positions by the President, a court of law or the
Department head. Because these ALJs were not so appointed, the Supreme Court held that the
petitioner was entitled to a new hearing before a different, constitutionally appointed ALJ. See id.
at 2055. The Supreme Court expressly held that an Appointments Clause problem cannot be cured
* As explained below, however, this response was neither sufficient under Supreme Court
precedent nor consistent with the procedure that the Commissioner had announced would be
applied in such cases.
by ratification after the fact. Indeed, the matter cannot even be remanded to the same ALJ who has
been subsequently appointed constitutionally. /d. at 2055.
The Lucia decision did not address the constitutional status of ALJs in other federal
agencies, including the Social Security Administration. However, on July 16, 2018, the Acting
Commissioner of the SSA ratified the appointments of its ALJs and approved these appointments
as her own. SSR 19-1p; Titles II & XVI: Effect of the Decision in Lucia v, Securities and Exchange
Commission (SEC) on Cases Pending at the Appeals Council, 84 Fed. Reg. 9582-9583 (Mar. 15,
2019).
In SSR 19-lp, the Administration indicated it would address Appointments Clause
challenges as follows:
When the Appeals Council grants review based on a timely-raised Appointments
Clause challenge, AAJs who have been appointed by the Acting Commissioner (or
whose appointments the Acting Commissioner has ratified) will vacate the hearing
decision or dismissal. In cases in which the ALJ made a decision, the Appeals
Council will conduct a new and independent review of the claims file and either
remand the case to an ALJ other than the ALJ who issued the decision under review,
or issue its own new decision about the claim covering the period before the date
of the ALJ’s decision. In its review, the Appeals Council will not presume that the
prior hearing decision was correct.
In Cirko on behalf of Cirko v. Commissioner of Social Security, 948 F.3d 148, 155 (3d Cir.
2020), the Court of Appeals for the Third Circuit held that a Social Security claimant is not required
to exhaust his or her administrative remedy regarding an unconstitutionally appointed ALJ before
raising this issue with a district court. See also Ramsey v. Commissioner of Soc. Security, 973 F.3d
537, 540 (6th Cir. 2020) (agreeing with Cirko).°
As neither party addressed the Lucia or Cirko decisions in their motions for summary
3 Other circuits disagree. See Carr v. Commissioner of Soc. Security, 961 F.3d 1267, 1275 (10th
Cir. 2020); Davis v. Commissioner of Soc. Security, 963 F.3d 790 (8th Cir. 2020). This Court is
required to follow the holdings of the Third Circuit.
judgment, the Court directed them to submit supplemental briefs to address these decisions as they
may relate to this action. In his supplemental brief, Brown contends that based upon the holding
in Cirko, this matter must be remanded for a new hearing before a different ALJ. The
Commissioner disagrees, noting that Cirko only rejected the applicability of an exhaustion
requirement in Social Security administrative proceedings, not the issue of waiver in a subsequent
challenge in federal court. Thus, he argues, Brown waived any Appointments Clause challenge by
failing to raise it in his opening brief to this Court.
As an initial matter, it should be noted that the Commissioner’s discussion of waiver
principally relies upon federal appellate cases that are ultimately governed by specific rules that
address this issue. For example, in Barna v. Bd. of Sch. Directors of Panther Valley Sch. Dist., 877
F.3d 136, 147 (3d Cir. 2017), the Court of Appeals discussed waiver based upon Federal Rule of
Appellate Procedure 28(a) and Third Circuit Local Appellate Rule 28.1, both of which require
parties to present all of their arguments in their opening briefs. And in United States v. Olano, 507
U.S. 725, 733 (1993), the Supreme Court reviewed Federal Rule of Criminal Procedure 52(b),
which addresses when appellate courts can consider arguments not raised in the trial court.4
Neither the Federal Rules of Civil Procedure nor the Local Rules of this Court include any
such limitation. Indeed, Federal Rule of Civil Procedure 56(f) allows a district court to grant
summary judgment on grounds not raised by parties at all as long as they are given notice and an
opportunity to be heard on the issue. See also Forrest v. Parry, 930 F.3d 93, 110-111 (3d Cir.
2019) (“district courts may grant summary judgment sua sponte, so long as the losing party is
4 The Commissioner cites several district court cases, but they merely cite appellate cases without
explaining why these appellate rules would apply at the district court level. Wilson v. Colvin, 218
F. Supp. 3d 439, 452 (E.D. Pa. 2016); Brown y. Colvin, 2017 WL 6606903, at *6 (M.D. Pa. Dec.
27, 2017); Weilacher vy. Astrue, 2010 WL 5483366, at *4 (W.D. Pa. Oct. 14, 2010), report and
recommendation adopted, 2011 WL 9610 (W.D. Pa. Jan. 3, 2011).
given notice when summary judgment is being contemplated.”) Thus, arguing that Brown waived
the Appointments Clause issue by failing to raise it in his motion for summary judgment is largely
based on an analogy to the manner by which such matters are addressed in courts of appeal, which
operate under different procedural rules than district courts. While some district courts apply this
analogy to matters before them, the Commissioner does not address why the Court should do so
here, particularly after the Court directed the parties to address the Appointments Clause issue.
Nevertheless, even if the Commissioner’s waiver argument is considered, it is unavailing.
Waiver is the “the intentional relinquishment or abandonment of a known right.” Barna, 877 F.3d
at 147 (quoting United States v. Olano, 507 U.S. 725, 733 (1993)). This matter is not properly
characterized as a waiver situation. There is no evidence that Brown’s failure to raise this argument
was an intentional relinquishment or abandonment of a known right.
Rather, the proper inquiry is whether Brown “forfeited” his Appointments Clause
challenge. The Third Circuit has explained that “‘[florfeiture is the failure to make the timely
assertion of a right,’ an example of which is an inadvertent failure to raise an argument.” Barna,
877 F.3d at 147 (quoting Olano, 507 U.S. at 733). The distinction is important because “a federal
court has the authority to resurrect only forfeited [claims].” Jd. at 146 n.7 (quoting Olano and
Wood v. Milyard, 566 U.S. 463, 471 n.5 (2012)). Specifically, the Court may overlook forfeiture
when the forfeited issue is purely legal in nature. See id. at 147-48 (listing cases where the Third
Circuit has considered forfeited legal issues). This is especially true “where refusal to reach the
issue would result in a miscarriage of justice or where the issue’s resolution is of public
importance.” Jd. at 147 (internal citations omitted). Moreover, courts of appeal may exercise their
discretion to consider an argument even if it has not been advanced in the first instance at the
district court level. See, e.g., Freeman vy. Pittsburgh Glass Works, LLC, 709 F.3d 240, 249 (3d Cir.
2013).
Therefore, it could be argued that at most, Brown forfeited, not waived, his Appointments
Clause challenge by failing to raise this issue in his motion for summary judgment. However, a
district court may consider, and grant, summary judgment on grounds not raised by the parties.
Fed. R. Civ. P. 56(f). Both parties have been given notice and an opportunity to respond regarding
the impact of Lucia and Cirko on this case. Moreover, the Court concludes that it will exercise its
discretion to address the issues raised by these decisions. Whether this case should be remanded
because the ALJ who conducted Brown’s hearing and issued a decision was not constitutionally
appointed is a legal issue that can be addressed at this time, thereby conserving judicial resources
and promoting the efficient administration of justice. No final judgment has been entered in this
case, and there is no substantial prejudice to the Commissioner or to the public if this issue is
considered and resolved at this time. While the Commissioner argues that he had to review the
administrative transcript and research and respond to the issues Brown raised in his motion for
summary judgment, there is no reason why these issues cannot be addressed on remand.
Having exercised its discretion to consider this issue, the Court concludes that Brown is
entitled to have his claim determined by an ALJ who is constitutionally appointed. As the Third
Circuit recognized, an Appointments Clause challenge addresses fundamental constitutional
issues, noting that these challenges “implicate both individual constitutional rights and the
structural imperative of separation of powers.” Cirko, 948 F.3d at 153 (citing Glidden Co. v.
Zdanok, 370 U.S. 530, 536-37 (1962)). The Cirko court stressed that “important individual liberty
[is] safeguarded by the Appointments Clause.” Jd. at 154. As stated by the Court of Appeals, this
is particularly critical when resolving claims for disability benefits:
The need to protect those individual rights is especially acute, however, where, as
here, claimants’ “physical condition and dependency on the disability benefits” are
at issue. Mathews v. Eldridge, 424 U.S. 319, 331 (1976). Disability benefits are
usually claimants’ primary source of income—highlighting the need for both the
appearance and reality of fair adjudicators appointed impartially under the
Appointments Clause and making the “nature of [a disability] claim” an “important
factor[]” in determining whether to take federal jurisdiction over a procedurally
flawed administrative appeal, id. at 331 n.11. Indeed, we have said that in such
cases “the claimant’s interest in having the constitutional issue resolved promptly
is so great that further deference to agency procedures is inappropriate.” Mattern v.
Mathews, 582 F.2d 248, 253 (3d Cir. 1978).
Id. at 157 (footnote omitted),
The Commissioner cites Waldor v. Saul, 2020 WL 2557340, at *2 (W.D. Pa. May 20,
2020), in which the court asked for additional briefing on this issue and found that the plaintiff had
not forfeited an Appointments Clause challenge. He argues that case is distinguishable because the
Cirko case had not been decided at the time of the initial briefing (unlike in this case) and therefore
the decision itself presented “exceptional circumstances” allowing for the issue to be considered.
However, the court in Waldor also stated that “given that the decision in Cirko was in large part
crafted to prevent parties from forfeiting rights inadvertently by failing to raise them at the first
opportunity, it seems appropriate to extend this way of thinking to federal cases such as this one.”
Id. Thus, the Court is not persuaded that this situation is distinguishable.
The ALJ heard Brown’s case on June 20, 2018. It was not until July 16, 2018, that the
Acting Commissioner of the SSA ratified the appointments of ALJs and approved these
appointments as her own. Thus, the ALJ who adjudicated and decided Brown’s case was not
properly appointed under the Appointments Clause of the United States Constitution at the time
of the hearing. This squarely presented an Appointments Clause issue. See Morris v. Commissioner
of Soc. Sec., 2020 WL 3104931, at *1-2 (W.D. Pa. June 11, 2020) (remanding case when ALJ who
was not properly appointed for a period of time while the case was pending).
Brown raised this issue before the Appeals Council (thus, this case does not present an
issue of failure to exhaust remedies), but the Appeals Council erroneously concluded that the
Commissioner’s after-the-fact ratification of ALJs somehow cured the problem. As explained
above, this conclusion was not consistent with what the Administration said it would do in SSR
19-Ip. More significantly, it is inconsistent with the holding in Lucia. Therefore, the matter will
be remanded to the Commissioner for review before a different ALJ.
Any errors which occurred in the original proceeding which formed the basis of Plaintiff's
arguments in his motion for summary judgment should be addressed on remand. See Morris, 2020
WL 3104931, at *2; Hoover v. Saul, 2020 WL 1550663, at *2 (M.D. Pa. Apr. 1, 2020).
For these reasons, it is ORDERED that the Commissioner’s final decision is vacated and
this matter is remanded to the Social Security Administration for a new hearing before a different
constitutionally appointed Administrative Law Judge than the Administrative Law Judge who
presided over Brown’s first hearing.
Dated: November 9, 2020
BY THE T:
United States Magistrate Judge