error 12 harmless if “there remains substantial evidence supporting the ALJ’s decision and 13 the error does not negate the validity of the ALJ’s ultimate conclusion.”
How later courts described this case
- error 12 harmless if “there remains substantial evidence supporting the ALJ’s decision and 13 the error does not negate the validity of the ALJ’s ultimate conclusion.”
- “[s]ubstantial evidence is 22 more than a mere scintilla but less than a preponderance”
- remand for further proceedings rather than for the immediate payment of 13 benefits is appropriate where there are “sufficient unanswered questions in the 14 record”
- “Because we remand the case to the ALJ for the reasons stated, we decline to 28 reach [plaintiff’s] alternative ground for remand.”
Written by the judges who cited it.
The opinion
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8 UNITED STATES DISTRICT COURT
9 CENTRAL DISTRICT OF CALIFORNIA
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MONICA M.,1
11 Case No. 2:22-cv-07039-GJS
Plaintiff
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v.
13 MEMORANDUM OPINION AND
KILOLO KIJAKAJI, Acting ORDER
14 Commissioner of Social Security,
15 Defendant.
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17 I. PROCEDURAL HISTORY
18 Plaintiff Monica M. (“Plaintiff”) filed a complaint seeking review of the
19 decision of the Commissioner of Social Security denying her application for
20 Disability Insurance Benefits (“DIB”). The parties filed consents to proceed before
21 a United States Magistrate Judge [Dkt. 10, 12, and 14] and briefs [Dkt. 18 (Pl. Br.),
22 25 (Def. Br.), and 26 (Response)] addressing disputed issues in the case. The matter
23 is now ready for decision. For the reasons set forth below, the Court finds that this
24 matter should be remanded.
25 / / /
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27 1 In the interest of privacy, this Order uses only the first name and the initial of
the last name of the non-governmental party.
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1 II. ADMINISTRATIVE DECISION UNDER REVIEW
2 Plaintiff filed an application for DIB on September 23, 2019, alleging
3 disability beginning February 22, 2018. [Dkt. 17, Administrative Record (“AR”) 17,
4 206-07.] Plaintiff’s application was denied at the initial level of review and on
5 reconsideration. [AR 17, 137-41, 147-53.] A telephone hearing was held before
6 Administrative Law Judge Henry Koltys (“the ALJ”) on March 11, 2021. [AR 17,
7 71-101.]
8 On July 2, 2021, the ALJ issued an unfavorable decision applying the five-
9 step sequential evaluation for assessing disability. [AR 17-26]; see 20 C.F.R. §
10 404.1520(b)-(g)(1). At step one, the ALJ determined that Plaintiff had not engaged
11 in substantial gainful activity since February 22, 2018, the alleged onset date. [AR
12 19.] At step two, the ALJ determined that Plaintiff has the following severe
13 impairments: osteoarthritis; carpal tunnel syndrome; fibromyalgia; peripheral
14 neuropathy; migraines; and obesity. [AR 19.] At step three, the ALJ determined
15 that Plaintiff does not have an impairment or combination of impairments that meets
16 or medically equals the severity of one of the impairments listed in Appendix I of
17 the Regulations. [AR 20-21]; see 20 C.F.R. Pt. 404, Subpt. P, App. 1. Next, the
18 ALJ found that Plaintiff has the residual functional capacity (“RFC”) to perform
19 light work, as defined in 20 C.F.R. § 404.1567(b), except Plaintiff can frequently
20 handle with the right upper extremity, must avoid concentrated exposure to
21 environmental hazards, and can never climb ladders, ropes, or scaffolds. [AR 21.]
22 At step four, the ALJ determined that Plaintiff is capable of performing her past
23 relevant work as an administrative clerk and mortgage loan processor. [AR 26.]
24 Therefore, the ALJ concluded that Plaintiff was not under a disability from February
25 22, 2018, through the date of the decision. [AR 26.]
26 The Appeals Council denied review of the ALJ’s decision on July 25, 2022.
27 [AR 1-7.] This action followed.
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1 Plaintiff raises the following issues challenging the ALJ’s findings and
2 determination of non-disability:
3 1. The ALJ failed to properly evaluate medical opinion evidence. [Pl. Br.
4 at 15-20.]
5 2. The ALJ erred in determining Plaintiff’s severe impairments. [Pl. Br.
6 at 21-23.]
7 3. The ALJ failed to properly evaluate Plaintiff’s symptoms and
8 testimony. [Pl. Br. at 23-25.]
9 The Commissioner asserts that the ALJ’s decision is supported by substantial
10 evidence and should be affirmed. [Def. Br. at 2-19.]
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12 III. GOVERNING STANDARD
13 Under 42 U.S.C. § 405(g), the Court reviews the Commissioner’s decision to
14 determine if: (1) the Commissioner’s findings are supported by substantial
15 evidence; and (2) the Commissioner used correct legal standards. See Carmickle v.
16 Comm’r Soc. Sec. Admin., 533 F.3d 1155, 1159 (9th Cir. 2008); Brewes v. Comm’r
17 Soc. Sec. Admin., 682 F.3d 1157, 1161 (9th Cir. 2012). “Substantial evidence … is
18 ‘more than a mere scintilla’ … [i]t means – and only means – ‘such relevant
19 evidence as a reasonable mind might accept as adequate to support a conclusion.’”
20 Biestek v. Berryhill, 139 S. Ct. 1148, 1154 (2019) (citations omitted); Gutierrez v.
21 Comm’r of Soc. Sec., 740 F.3d 519, 522 (9th Cir. 2014) (“[s]ubstantial evidence is
22 more than a mere scintilla but less than a preponderance”) (internal quotation marks
23 and citation omitted).
24 The Court will uphold the Commissioner’s decision when “‘the evidence is
25 susceptible to more than one rational interpretation.’” Burch v. Barnhart, 400 F.3d
26 676, 681 (9th Cir. 2005) (quoting Magallanes v. Bowen, 881 F.2d 747, 750 (9th Cir.
27 1989)). However, the Court may review only the reasons stated by the ALJ in the
28 decision “and may not affirm the ALJ on a ground upon which he did not rely.”
1 Orn v. Astrue, 495 F.3d 625, 630 (9th Cir. 2007). The Court will not reverse the
2 Commissioner’s decision if it is based on harmless error, which exists if the error is
3 “inconsequential to the ultimate nondisability determination, or that, despite the
4 error, the agency’s path may reasonably be discerned.” Brown-Hunter v. Colvin,
5 806 F.3d 487, 492 (9th Cir. 2015) (internal quotation marks and citations omitted).
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IV. DISCUSSION
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Plaintiff contends that the ALJ erred in determining that she did not have a
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severe mental impairment. [Pl. Br. at 21-23.] Defendant contends that the ALJ
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properly decided the severity of Plaintiff’s impairments and adequately considered
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the medical evidence in reaching his decision. [Def. Br. at 9-13.] Defendant also
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asserts that it is immaterial that the ALJ found Plaintiff’s mental impairments non-
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severe at step two because the ALJ considered all of Plaintiff’s impairments,
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regardless of severity, in the assessment of Plaintiff’s RFC and later in the disability
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analysis. [Def. Br. at 9-10, 13.] For the reasons set forth below, the Court finds that
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the ALJ erred in determining that Plaintiff’s mental impairment was not severe, and
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the error was not harmless.
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The evaluation at step two is a “de minimis screening device to dispose of
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groundless claims.” Smolen v. Chater, 80 F.3d 1273, 1290 (9th Cir. 1996); Bowen
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v. Yuckert, 482 U.S. 137, 153-154 (1987). “At step two, the ALJ assesses whether
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the claimant has a medically severe impairment or combination of impairments that
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significantly limits [her] ability to do basic work activities.” Webb v. Barnhart, 433
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F.3d 683, 686-87 (9th Cir. 2005); 20 C.F.R. § 404.1520(c) (“If you do not have any
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impairment or combination of impairments which significantly limits your physical
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or mental ability to do basic work activities, we will find that you do not have a
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severe impairment”). An impairment “may be found ‘not severe only if the
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evidence establishes a slight abnormality that has no more than a minimal effect on
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an individual’s ability to work.’” Webb, 433 F.3d at 686-87 (quoting Smolen, 80
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1 F.3d at 1290). A “finding of no disability at step two” may be affirmed when there
2 is a “total absence of objective evidence of [a] severe medical impairment.” Webb,
3 433 F.3d at 688.
4 Here, the ALJ determined that Plaintiff’s medically determinable mental
5 impairment of depression does not cause more than a minimal limitation in
6 Plaintiff’s ability to perform basic mental work activities and, therefore, is not a
7 severe impairment. [AR 19-20.] In making this determination, the ALJ considered
8 the four broad areas of mental functioning known as the “paragraph B” criteria. [AR
9 20]; see 20 C.F.R. § 404.1520a(c)(3) (identifying “four broad functional areas” as
10 the ability to: “[u]nderstand, remember, or apply information; interact with others;
11 concentrate, persist, or maintain pace; and adapt or manage oneself.”). 2 Finding
12 that Plaintiff’s mental status examinations since her alleged onset date were
13 generally “within normal limits,” the ALJ concluded that Plaintiff had “mild”
14 limitations in the four areas of mental functioning. [AR 20.] In support of these
15 findings, the ALJ asserted that Plaintiff’s mental status examinations generally
16 reflected that she was “calm and cooperative” with “appropriate mood and affect,
17 normal insight, and normal judgment,” there was “no indication that [she] was
18 unable to concentrate at her medical appointments,” and her “treatment providers
19 did not note abnormalities in [her] thought process, fund of knowledge, or memory.”
20 [AR 20.] The ALJ also indicated that Plaintiff was “a caretaker” of her two small
21 children. [AR 20.] Nevertheless, the ALJ acknowledged that Plaintiff’s mental
22 status examinations “frequently noted anxiety” and the record showed Plaintiff had
23 an “anxious and depressed” mood, was “occasionally tearful and irritable,” and
24 complained about “difficulty concentrating,” “excessive worry, fearful thoughts, []
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26 2 Under the “special technique regulation,” if the ALJ determines that a
medically determinable mental impairment exists, the ALJ “must specify the
27 symptoms, signs, and laboratory findings that substantiate the presence of the
impairment(s) and document [the] findings” and “rate the degree of functional
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limitation resulting from the impairment(s).” 20 C.F.R. § 404.1520a(b)(1)-(2).
1 depressed mood,” and “difficulty functioning.” [AR 20.] The ALJ’s reliance on the
2 generally “normal” mental status examination findings to negate evidence of
3 Plaintiff’s mood and affect abnormalities is not persuasive.
4 The medical evidence established repeated and consistent instances of mental
5 symptoms causing Plaintiff more than minimal limitations. For example, in
6 February 2018, Plaintiff was observed to be anxious and crying. [AR 537.] In April
7 2018, Plaintiff was reported to struggle with depression, stress, and panic attacks.
8 [AR 650.] In December 2018, Plaintiff’s dysthymia symptoms were reported as
9 severe and progressing. [AR 487.] In September 2019, Plaintiff was reported to be
10 easily startled, experiencing fatigue and excessive worry, and presenting with a
11 depressed mood and anxious, fearful, compulsive, and racing thoughts. [AR 455.]
12 In November 2019, Plaintiff’s behavior was observed to be anxious, despairing,
13 guilty, odd, and tearful, with decreased effort, but she was noted to be cooperative
14 and sincere. [AR 711.] Plaintiff’s mood was described as anxious, depressed,
15 frustrated, and irritable and her affect was congruent. [AR 711.] Plaintiff’s doctors
16 diagnosed Plaintiff with dysthymia, mood disorder with psychosis, and anxiety
17 disorder and prescribed psychotropic medications, which provided a modest
18 improvement in symptoms. [AR 457, 467, 472, 711-12, 1079, 1085, 1089, 1134.]
19 In January 2021, Plaintiff’s doctor reported that while Plaintiff’s overall anxiety
20 improved with medication, she was still experiencing depression, anxiety, panic,
21 mood swings, and insomnia. [AR 1134.]
22 On this record, the ALJ’s conclusion that Plaintiff’s mental impairment does
23 not meet the de minimis standard for establishing a severe impairment is not
24 supported by substantial evidence. See Webb, 433 F.3d at 687 (explaining that
25 ALJ’s conclusion that “a claimant lacks a severe impairment or combination of
26 impairments” is valid only when that conclusion is “clearly established by medical
27 evidence”) (internal quotation marks and citation omitted); Ortiz v. Commissioner of
28 Social Sec., 425 F. App’x 653, 655 (9th Cir. 2011) (noting that the ALJ’s reliance
1 “on two mental evaluations diagnosing Ortiz with depressive and anxiety disorders
2 but not ruling out either a learning disability or borderline intellectual functioning”
3 was “not the total absence of objective evidence of severe medical impairment that
4 would permit us to affirm a finding of no disability at step two.”) (internal quotation
5 marks and citation omitted). Further, the fact that Plaintiff was a caretaker for her
6 two young children is not a sufficient reason to find that Plaintiff’s mental
7 impairment is not severe at step two of the sequential evaluation.3
8 Moreover, the ALJ’s error cannot be considered harmless. An error is
9 harmless only if it is “inconsequential” to the ALJ’s “ultimate nondisability
10 determination.” Stout v. Comm’r, Soc. Sec. Admin., 454 F.3d 1050, 1055 (9th Cir.
11 2006); see also Molina v. Astrue, 674 F.3d 1104, 1115 (9th Cir. 2012) (error
12 harmless if “there remains substantial evidence supporting the ALJ’s decision and
13 the error does not negate the validity of the ALJ’s ultimate conclusion.”),
14 superseded on other grounds by 20 C.F.R. § 404.1502(a). Here, aside from
15 repeatedly citing the same erroneous reasons discussed above, the ALJ did not
16 properly address Plaintiff’s mental impairments in the subsequent steps of the
17 sequential analysis. [AR 19-20, 23-25.] Thus, the ALJ’s error in finding Plaintiff’s
18 mental impairments not “severe” was not harmless. Cf. Lewis v. Astrue, 498 F.3d
19 909, 911 (9th Cir. 2007) (finding step two error harmless as the ALJ extensively
20 discussed plaintiff’s bursitis and its effects when identifying the basis for limitations
21 in plaintiff’s RFC).
22 Accordingly, the ALJ’s step two determination is not supported by substantial
23 evidence.
24 / / /
25 / / /
26 / / /
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3 The Court notes that the record reflects that Plaintiff received assistance in
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caring for her children. [AR 93, 248-49, 1135.]
1 V. REMAND FOR FURTHER PROCEEDINGS
2 The Court has discretion to remand or reverse and award benefits. See
3 Trevizo v. Berryhill, 871 F.3d 664, 682 (9th Cir. 2017). It may be appropriate to
4 direct an immediate award of benefits when the record has been fully developed, no
5 useful purpose would be served by further proceedings, and the ALJ has failed to
6 provide legally sufficient reasons for rejecting evidence. Id. (citing Garrison v.
7 Colvin, 759 F.3d 995, 1019 (9th Cir. 2014)). But when there are outstanding issues
8 that must be resolved before a determination can be made, and it is not clear from
9 the record that the ALJ would be required to find a claimant disabled if all the
10 evidence were properly evaluated, remand for further proceedings is appropriate.
11 See Garrison, 759 F.3d at 1021; Harman v. Apfel, 211 F.3d 1172, 1180-81 (9th Cir.
12 2000) (remand for further proceedings rather than for the immediate payment of
13 benefits is appropriate where there are “sufficient unanswered questions in the
14 record”).
15 In this case, there are outstanding issues that must be resolved before a proper
16 disability determination can be made, as the ALJ failed to adequately consider
17 Plaintiff’s mental impairment. See Garrison, 759 F.3d at 1021; Harman, 211 F.3d
18 at 1180-81. Therefore, the Court remands this case for further proceedings.4
19 / / /
20 / / /
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24 / / /
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4 Having found that remand is warranted, the Court declines to address
27 Plaintiff’s remaining issues. See Hiler v. Astrue, 687 F.3d 1208, 1212 (9th Cir.
2012) (“Because we remand the case to the ALJ for the reasons stated, we decline to
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reach [plaintiff’s] alternative ground for remand.”).
1 VI. CONCLUSION
2 For all of the foregoing reasons, IT IS ORDERED that:
3 (1) the decision of the Commissioner is REVERSED and this matter is
4 |} REMANDED pursuant to sentence four of 42 U.S.C. § 405(g) for further
5 || administrative proceedings consistent with this Memorandum Opinion and Order;
6 || and
7 (2) Judgment be entered in favor of Plaintiff.
8 IT IS ORDERED.
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10 || DATED: September 11, 2023
11 LY Ae
UNITED STATES MAGISTRATE JUDGE
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