Record and brief — Schweiker v. Chilicky

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Text

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No. 86-1781-CFX

Status: GRANTED

Docketed:

May 6, 1987

Entry Date

Note

Court: United States Court of Appeals

Title: Richard Schweiker, et al., Petitioners

Vv.

James Chilicky, et al.

for the Ninth Circuit

Counsel for petitioner: Solicitor General

Counsel for respondent: Morris,William E., Tribe,Laurence H.

NOTE: Time to file ext by O’Connor, J. to & inc.

5/7/87 cited

Proceedings and Orders

1987

1988

i968

1988

Application for extension of time to file petition and

order granting same until May 7, 1987 (O’Connor,

February 27, 1987).

Petition for writ of certiorari filed.

Brief of respondents James Chilicky, et al. in opposition

filed.

DISTRIBUTED. June 25, 1987

REDISTRIBUTED. September 28, 1987

Petition GRANTED.

SEAAAAAAAAAAAAAAAAAAAAAAEAAARAAAAAEAERAEARERERREAEREHRERAREEEEE

Motion of the Solicitor General to dispense with

printing the joint appendix filed.

Motion of the Solicitor General to dispense with

printing the joint appendix GRANTED.

Order extending time to file brief of petitioner on the

merits until December 3, 1987.

Beief of petitioners Richard Schweiker, et al. filed.

Record filed.

Certified copy of original record and Cc. A. proceedings

received, 3 volumes.

Order extending time to file brief of respondent on the

merits until January 22, 1988.

SET FOR ARGUMENT. Tuesday, March 1, 1988. (4th case). (1

hour).

CIRCULATED.

Brief of respondents James Chilicky, et al. filed.

X Brief amici curiae of National Mental Health Association, et

al. filed.

B..ief amici curiae of ACLU, et al. filed.

Reply brief of petitioners Richard Schweiker, et al. filed.

ARGUE

PETITION FOR

WRIT OF

CERTIORARI

Fea

86 1782) woo

No. 7, ik JOSEPH F. Brae JR.

In the Supreme Court of the Gnited States

OcToOBER TERM, 1986

"EILED

RICHARD SCHWEIKER, ET AL., PETITIONERS

Vv.

JAMES CHILICKY, ET AL.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

CHARLES FRIED

Solicitor General

RICHARD K. WILLARD

Assistant Attorney General

DONALD B. AYER

Deputy Solicitor General

ROGER CLEGG

Assistant to the Solicitor General

WILLIAM KANTER

HOWARD S. SCHER

Altorneys

Deparimeni of Justice

Washington, D.C. 20530

(202) 633-2217

QUESTION PRESENTED

Whether a Bivens remedy should be implied for alleged

due process violations in the denial of social security

disability benefits.

(1)

PARTIES TO THE PROCEEDING

Petitioners are Richard Schweiker, former Secretary of

Health and Human Services; John Svahn, former Com-

missioner of the Social Security Administration; and

William R. Sims, Director of the Arizona Disability Deter-

mination Service. Respondents are James Chilicky, Dora

Adelerte, and Spencer Harris.'

' In the original complamt there were, besides respondents, seven

other plaimtitfs. These seven, who did not pursue the appeal to the

Ninth Cwrcun, were Atanacio Alamanza, Arthur Flynn, Donald Bond,

Demutrio Higuera, Joseph Tellez, Bonnie Bircher, and Conme Diaz.

TABLE OF CONTENTS

, Page

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Nee ce ce ccc esc tbesscoccccccecs l

Statutory provisions involved ........5 0.0.0... 50 eee eewees 2

Statement:

A. The statutory and regulatory framework for review

ee os oc nccbedccecesceesces 2

B. The proceedings in this case ...............0000005: 4

Reasons for granting the petition ..................000005. 8

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i ee eee caceeseeeebeseccccecoccees 1Sa

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ee eee Cee cab ce ecccccesevescceccccess 24a

TABLE OF AUTHORITIES

Cases:

Bivens v. Six Unknown Named Federal Narcotics Agents,

ED eb cdccndececes 6, 8, 11, 12, 14, 15, 16

Bowen v. City of New York, No. 84-1923 (June 2, 1986) . 2

Bush v. Lucas, 462 U.S. 367 (1983) ......... 8, 9, 10, 11, 15, 16

Califano v. Boles, 443 U.S. 282 (1979) ................. 14

Califano v. Sanders, 430 U.S. 99 (1977) .... 2.20000. 0.. 12

Carlson v. Green, 446 U.S. 14(1980) .................. 11

Ellis v. Blum, 643 F.2d 68 (2d Cir. 1981) ............... S

Harlow v. Fitzgerald, 457 U.S. 800 (1982) .............. 6

Heckler v. Campbell, 461 U.S. 458 (1983) .............. 14

Heckler v. Day, 467 U.S. 104 (1984) ................. 9, 10, 15

Heckler v. Ringer, 466 U.S. 602 (1984) .............. 10, 13, 14

Hudson v. Palmer, 468 U.S. 517 (1984) ................ 11

Mathews v. Eldridge, 424 U.S. 319 (1976) .............. 11

Parratt v. Taylor, 451 U.S. $27 (1981) ...... 2.2.2.0... 11

Richardson v. Perales, 402 U.S. 389 (1971)... 2.2... 14

(111)

Cases — Continued: Page

United States v. Standard Oil Co., 332 U.S. 301 (1947)... 10

Weinberger v. Salfi, 422 U.S. 749 (1975) .. 2... 2... 13, 14, 15

Constitution, statutes and regulations:

U.S. Const.:

I sce cencuckubhdwuenesseene ital te emheia bale es 8

Amend. XIV (Due Process Clause) ................. I

Social Security Act:

Tit. Il, 42 U.S.C. (& Supp. IIL) 401 ef seg. ........... 2

42 U.S.C. Goa. GE GRBGEE) 2. cc ccccccccccecs 3

i Ss op ccdcecccntevadees -6neeseus 2

is ee kéeendnces 3, 6, 10, 11, 12, 14, 15, 24a

42 U.S.C. (Supp. Il) 405(h) ...... 6, 8, 11, 12, 13, 14, 25a

es Se OID oo cccccccccevccess 2, 5

ic I EE 6.6.6 6 cceccccccseccscss 3

SEU Be. Gs CD 6c cnc ccs vacccccecess 2,4

Tit. XVI, 42 U.S.C. (& Supp. Ill) 1381 ef seg. ........ 2

ee ue eleuweheees 3

is SE o's cc ovecevdecdeseeeeeeecter 3

a ed Pou we eels 2

Pub. L. No. 96-265, § 311(a), 94 Stat. 460 (42 U.S.C.

IEE 5 cong ones eseeenssetuuncacedes 5

Pub. L. No. 97-455, § 2, 96 Stat. 2498 (42 U.S.C. (Supp.

I kde cteetewldadwectbeseecarensatedssens 4

Pub. L. No. 98-460, 98 Stat. 1794:

§ 6(d), 98 Stat. 1802 (42 U.S.C. 421 note) ............ 4

SD Eo sce tesbcccevescsDeasecetbencs 4

§ 7(b), 98 Stat. 1803 (42 U.S.C. (& Supp. II)

ths Jesteees cakes es hn edeeaneas cases 4

IR i ai lk i ek oe eae 12

eas wa oi a 05 ba SUA ee eR ee enel 11

20 C.F.R.:

eee Se ew eekb ae 3

es gro 8 eae 3

oS) cee bed Saad deen ean eee he 3

go .

Constitution, statutes and regulations — Continued:

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i Bes ee keke eescdunhets

ts. ots cca enbateeneeusé

as ee need eneeeeenes

Section 416.1433(b) .. 2.6... eee eee ee eee

gn. ue ea seabeeeeswes

as ee bebe ds du cdbneees

a ee ees ee eu h

ee en eanedab buabe ceeaunes

www www ww ww ww BN N Ww Ww Ww Ww Ww Ww NWN Ww

Miscellaneous:

H.R. Rep. 728, 76th Cong., Ist Sess. (1939) ............ 12

S. Rep. 734, 76th Cong., Ist Sess. (1939) ............... 12

oo re ee mee a

In the Supreme Court of the Gnited States

OCTOBER TERM, 1986

No.

RICHARD SCHWEIKER, ET AL., PETITIONERS

JAMES CHILICKY, ET AL.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

The Solicitor General — on behalf of Richard Schweiker,

former Secretary of Health and Human Services; John

Svahn, former Commissioner of the Social Security Ad-

ministration; and William R. Sims, Director of the

Arizona Disability Determination Service (Arizona’s com-

ponent of the social security disability program) — peti-

tions for a writ of certiorari to review the judgment of the

United States Court of Appeals for the Ninth Circuit in

this case.

OPINIONS BELOW

The opinion of the court of appeals (App., infra,

la-14a) is reported at 796 F.2d 1131. The opinion of the

district court (App., infra, 1Sa-18a) is unreported.

JURISDICTION

The judgment of the court of appeals (App., in/ra,

19a-20a) was entered on August 12, 1986. A petition for

rehearing with a suggestion for rehearing en banc was

denied on December 8, 1986 (App., infra, 2la-22a). On

(1)

February 27, 1987, Justice O’Connor extended the time

for filing a petition for a writ of certiorari to and including

May 7, 1987. The jurisdiction of this, Court is invoked

under 28 U.S.C. 1254(1).

STATUTORY PROVISIONS INVOLVED

The pertinent statutory provisions, 42 U.S.C. (& Supp.

111) 405(g) and (h), are set forth in App., infra, 24a-26a.

STATEMENT

A. The Statutory And Regulatory Framework For Review of

Disability Claims

1. The disability programs under Title II (see 42 U.S.C.

(& Supp. IIl) 401 er seg.) and Title XVI (see 42 U.S.C. (&

Supp. II) 1381 ef seg.) of the Social Security Act are ad-

ministered jointly by state agencies and the Secretary of

Health and Human Services. Congress has directed that

the determination whether an individual is under a

disability shall be made in the first instance by a state

agency (here, the Arizona Disability Determination Serv-

ice), pursuant to regulations, guidelines, and performance

standards established by the Secretary. 42 U.S.C. (&

Supp. Ill) 421(a), 1383b(a); 20 C.F.R. 404.1503, 416.903;

Bowen v. City of New York, No. 84-1923 (June 2, 1986),

slip op. 3.

If the state agency makes an initial determination that a

new applicant is not disabled—or that the disability of a

current recipient has ceased (see 42 U.S.C (& Supp. III)

421(i)) —the individual may request a de novo reconsidera-

tion by the state agency. The claimant has the right to a

face-to-face interview before the reconsideration (see 42

U.S.C. 405(b)(2); 20 C.F.R. 404.917) and he is personally

notified that he must request reconsideration within 60

days of his receipt of the adverse initial determination. 20

C.F.R. 404.904, 404.909(a)(1), 416.1404, 416.1409(a). If

he does not do so, the adverse initial determination

becomes binding upon him. 20 C.F.R. 404.905, 416.1405.

If an individual is dissatisfied with the agency’s decision

on reconsideration, he “shall be entitled to a hearing

thereon by the Secretary.” 42 U.S.C. (Supp. II1) 421(d);

see also 42 U.S.C. 1383(c\1). The Act requires —and the

claimant is personally notified — that he must request such

a hearing, which will be conducted by an ALJ, within 60

days of his receipt of the state agency’s reconsideration

decision. 42 U.S.C. (Supp. III) 405(b)(1); 42 U.S.C.

1383(c)(1). Absent such timely request, the state agency’s

decision becomes binding upon the claimant. 20 C.F.R.

404.920, 404.921(a), 404.933(b), 416.1404(b)(3), 416.1405,

416.1420, 416.1421(a), 416.1433(b). If the ALJ’s decision

is adverse to the claimant, he then may seek review by the

Appeals Council of the Social Security Administration

(SSA). The claimant is specifically informed that if he

does not seek such review within 60 days, the adverse A‘ J

decision is binding. 20 C.F.R. 404.955(a), 404.968(a)(1),

416.1455(a), 416.1468.

After the Appeals Council has either denied review of the

ALJ's decision or granted review and rendered its own deci-

sion, the claimant may seek judicial review pursuant to 42

U.S.C. 405(g). See 42 U.S.C. (Supp. II1) 421(d), 1383(c)(3);

20 C.F.R. 404.900(a)(5), 404.981, 416.1400(a)(5), 416.1481,

422.210.

2. In addition to the multi-level framework for review

just outlined, Congress has afforded other procedural pro-

tections for individuals, like respondents here, who have

been receiving disability benefits but whose eligibility to

continue to receive such benefits is under review by the

Secretary. With respect to recipients of Title II benefits,

Congress in 1983 enacted temporary legislation (which has

been extended through January 1, 1988), permitting

claimants to continue to receive benefits following an

adverse initial decision until an ALJ had rendered a deci-

sion on the claim. Pub. L. No. 97-455, § 2, 96 Stat. 2498,

codified at 42 U.S.C. (Supp. Il) 423(g); Pub. L. No.

98-460, § 7(a)(2), 98 Stat. 1802. Congress has afforded the

same protection to Tithe XVI (Supplemental Security In-

come (SS1)) recipients, whose eligibility is based on need.

See Pub. L. No. 98-460, § 7(b), 98 Stat. 1803, codified at

42 U.S.C. (& Supp. II1]) 1383(ax(7). This statutory action

followed years of a similar regulatory practice with respect

to SSI recipients. See 20 C.F.R. 416.1336(b).

Finally, Congress has required the Secretary to establish

demonstration projects in at least five states, pursuant to

which the Secretary gives Title Il and Title XVI claimants

the opportunity for a personal appearance prior to the in-

itial determination of ineligibility under 42 U.S.C. (&

Supp. Ill) 421(i), rather than afterwards. Pub. L. No.

98-460, § 6(d), 98 Stat. 1802, codified at 42 U.S.C. 421

note. Thus the recipient is enabled to argue his claim in ad-

vance of the initial determination, where the state agency

has reached a preliminary conclusion adverse to the claim-

amt. Congress has directed the Secretary to file a report

concerning these projects. /bid.

B. The Proceedings in This Case

1. Respondents are three individuals’? who were ben-

eficiaries of disability benefits under Title Il or Tithe XVI.

They filed sum against Richard Schweiker, John Svahn,

and William R. Sims in their official and individual

capacities.’ Richard Schweiker is the former Secretary of

> Respondents have withdrawn their earlier motion for class cer-

tification (see App., infra, 4a, 1Sa). As stated at page II note |, supra,

of the ten original plaintiffs only the three respondents pursued their

claim through the court of appeals.

’ Respondents tailed to serve two additional defendants properly,

and consequently the district court dismissed the claims against them

im thew individual capacities (App., fra, 2a-3a n.1, 16a). By the time

Health and Human Services; John Svahn is the former

Commissioner of the Social Security Administration; and

William R. Sims is the present director of the Arizona Dis-

ability Determination Service. App., infra, 2a, 1Sa-16a.

Respondents were subject to “continuing disability

review” (CDR), a process Congress enacted in 1980 to en-

sure that only those individuals whose medical conditions

still warranted disability status received payment. Pub. L.

No. 96-265, § 311(a), 94 Stat. 460, codified at 42 U.S.C.

(& Supp. II) 421(i); see also App., infra, 2a. Their

benefits were terminated by the CDR process; the benefits

were, however, ultimately reinstated through the ad-

ministrative appeals process. See App., infra, 2a.

In their complaint, respondents claimed that petitioners

had violated their due process rights by, inter alia, ac-

celerating the starting date of the CDR process; illegally

nonacquiescing in the law of the circuit; failing to apply

uniform written standards in implementing the CDR proc-

ess; failing to render decisions consistent with allegedly

dispositive evidence; and using an impermissible quota

system under which state agencies were required to ter-

minate a certain number of recipients. App., infra, 2a-3a;

see also page 7 note 6, infra. Respondents sought injunc-

tive and declaratory relief, and money damages for “emo-

tional distress and for loss of food, shelter and other

necessities proximately caused by [petitioners’] denial of

benefits without due process” (App., infra, 3a n.2).

2. The district court dismissed the case in its entirety

on qualified immunity grounds (App., infra, 1Sa-18a). lt

discussed why the government’s policies of accelerated re-

the case reached the court of appeals, only claims against officials in

their individual capacities remained (id. at 4a), and consequently these

two defendants are no longer in the case.

* The Arizona DDS is authorized by statute and is an integral part

of the federal disability determination process. See 42 U.S.C. (&

Supp. Hl) 421(a).

view and non-acquiescence violated no clearly established

statutory or constitutional rights, and thus concluded that

Harlow vy. Fitzgerald, 457 U.S. 800 (1982), barred

respondents’ damage claims with respect to these policies

(App., infra, 16a-18a). The district court did not discuss

respondents’ other claims, but apparently determined that

they were barred by qualified immunity as well (see id. at

16a, 18a).

3. Respondents then appealed to the United States

Court of Appeals for the Ninth Circuit, which affirmed in

part, reversed in part, and remanded the case to the

district court for further proceedings (App., in/ra,

la-14a). On appeal, the only issues raised by respondents

pertained to their Bivens’ claims for money damages

against petitioners in their individual capacities (see Resp.

C.A. Br. ii).

Petitioners contended that there was no subject matter

jurisdiction to entertain respondents’ claims, since the pro-

cedures set forth in 42 U.S.C. 405(g) are the exclusive

means of redress for actions “arising under” the relevant

provisions of the Social Security Act. See 42 U.S.C. (Supp.

Ill) 405(h). They also pointed out that the existence of the

Act’s elaborate procedures for resolving disability claims

counsels strongly against judicial implication of a damages

remedy, and that there could be no colorable claim of

denial of due process when respondents were afforded the

protections of Section 405(g). Petitioners also contended

that the district court lacked personal jurisdiction as well as

subject matter jurisdiction, and that in any event

respondents’ claims were barred by qualified immunity.

The court of appeals found that the district court had

subject matter jurisdiction (App., infra, 4a-6a). lt rea-

soned that the action was not for restoration of disability

benefits, but rather for damages stemming from constitu-

> See Bivens v. Six Unknown Named Federal Narcotics Agents, 403

U.S. 388 (1971).

tional violations committed in terminating those benefits,

so that it did not arise under the Social Security Act and

was not barred by Section 405(h) (App., infra, 6a). The

court then ruled that the officials waived their personal

jurisdiction defense by not raising it at the appropriate

Stage in the district court proceedings (id. at 7a-9a). Finally,

the court of appeals affirmed the district court's dismissal

on qualified immunity grounds of respondents’ accelera-

tion of review and nonacquiescence claims (id. at

lla-13a), but reversed the district court’s dismissal on

qualified immunity grounds of the balance of respondents’

claims® and remanded for futher proceedings (id. at

13a-14a). The court of appeals concluded that under the

current record it could not determine that respondents

could prove no state of facts estabiishing an actionable

due process violation for the latter claims (id. at 14a). ~

The court of appeals denied petitioners’ petition for

rehearing with a suggestion for rehearing en banc, which

was limited to the subject matter jurisdiction issue (App.,

infra, 2\a-22a).

* As described by the court of appeals (App., infra, 13a-14a), the

remaining allegations are:

1. Knowing use of unpublished criteria and rules and stand-

ards contrary to the Social Security Act.

2. intentional disregard of dispositive favorable evidence.

3. Purposeful selection of biased physicians and staff to review

claims.

4. Imposition of quotas.

5. Failure to review impartially adverse decisions.

6. Arbitrary reversal of favorable decisions.

7. Denial of benefits based on the type of disabling impair-

ment.

8. Unreasonable delays in receiving hearings after termination

of benefits.

REASONS FOR GRANTING THE PETITION

The decision of the court of appeals can be squared with

neither the plain language of Section 405(h) nor the deci-

sion of this Court in Bush v. Lucas, 462 U.S. 367 (1983).

Furthermore, the creation of a Bivens remedy for social

security claims would threaten to overwhelm not only the

Social Security Administration but also the federal courts

with an avalanche of litigation. If respondents — who were

ultimately denied not a penny of benefits and whose

damage claims border on the frivolous —can maintain a

Bivens action, then millions of social security claimants

can do so as well. Accordingly, action by this Court is ap-

propriate. At the same time, this is the first such ruling by

a court of appeals since this Court's decision in Bush v.

Lucas,’ and there is no conflict in the circuits. The United

States will shortly (May 13, 1987) file a petition for cer-

tiorari in Cooper v. Kotarski, posing the question of the

application of Bush v. Lucas in the probationary employ-

mem context, where a clear circuit conflict has developed.

In order to conserve this Court's limited plenary review

docket, we suggest that the Court hold this petition pend-

ing resolution of Aotarski.

1. a. The court of appeals’ decision is inconsistent

with this Court’s decision in Bush v. Lucas. In Bush, the

plaintiff asked this Court to authorize a Bivens remedy for

federal employees whose First Amendment rights are

allegedly violated by their employers. In its analysis, the

Court assumed that the “civil service remedies were not as

effective as an individual damages remedy and did not fully

compensate [plaintiff] for the harm he suffered” (462 U.S.

at 372 (footnotes omitted))—that is, that “a federal right

* In the pre-Bush v. Lucas decision of Ellis v. Blum, 643 F.2d 68

(1981), the Second Circuit upheld similar actions for damages based

on allegations of emotional distress, on reasoning similar to that of

the court of appeals here.

has been violated and Congress has provided a less than

complete remedy for the wrong” (id. at 373). It concluded,

however, that the proper focus for analysis was not on

“what remedy the court should provide for a wrong that

would otherwise go unredressed,” but rather on “whether

an elaborate remedial system that has been constructed

step by step, with careful attention to conflicting policy

considerations, should be augmented by the creation of a

new judicial remedy for the constitutional violation at

issue” (id. at 388). The Court held that, in light of the com-

prehensive procedural and substantive provisions of the

civil service laws governing the employment relationship

between the government and its employees, which the

Court emphasized had been carefully constructed by Con-

gress over many years, it would be inappropriate to create

a new Bivens remedy. /d. at 388-390; see also id. at

390-392 (Marshall, J., concurring).

Like the civil service laws, the Social Security Act's

special statutory procedures were the result of a carefully

considered, step-by-step fine-tuning by Congress. See,

e.g., Heckler v. Day, 467 U.S. 104, 111-118 (1984). This

Court has noted that, “[t}o facilitate the orderly and sym-

pathetic administration of the disability program of Title

Il, the Secretary and Congress have established an

unusually protective four-step process [discussed at pages

2-4, supra) for the review and adjudication of disputed

claims” (id. at 106). The scheme has, for at least the last

decade, “inspired almost annual congressional debate”

(Heckler v. Day, 467 U.S. at 112). Indeed, as discussed at

pages 3-4, supra, Congress in 1983 specifically refined the

administrative review process to address the very concerns |

at issue here — namely, that disability claimants might ex-

perience undue financial or emotional harm by a cut-off

of benefits while they pursued their administrative

remedies. Accordingly, claimants like respondents may

now continue to receive benefits through the ALJ hearing

stage while they challenge an adverse decision made at an

earlier stage of the administrative process, and, in

Statutorily mandated demonstration projects, are given an

opportunity to appear and be heard prior to an initial

determination, where the state agency has given

preliminary indication of an adverse decision.

The structure and history of the social security disability

program thus plainly demonstrate that we are dealing with

a “comprehensive scheme * * * providfing) meaningful

remedies” (Bush, 462 U.S. at 386), and that Congress has

long been attentive to fine-tuning those remedies as

necessary. This is a “pervasively regulated area,” and the

court of appeals decision is an “unwarranted judicial in-

trusion” (Heckler v. Day, 467 U.S. at 119). As in Bush,

Congress has provided “an elaborate remedial system that

has been constructed step by step, with careful attention to

conflicting policy considerations” (Bush, 462 U.S. at 388),

which would only be impaired by recognition of sup-

plementary, piece-meal remedies. See id. at 379-380,

388-389; United States v. Standard Oil Co., 332 U.S. 31,

314 (1947).

In Bush, this Court “decline[d] ‘to create a new substan-

tive legal liability without legislative aid and as at the com-

mon law,’ * * * because we are convinced that Congress is

in a better position to decide whether or not the public in-

terest would be served by creating it” (462 U.S. at 390

(cation omitted)). And in connection with another sec-

tion of the Social Security Act, this Court in Heckler v.

Ringer, 466 U.S. 602, 627 (1984), observed that Congress

must have understood that “hardship” could occur in the

course of pursuing Section 405(g) remedies and, “[i}f the

balance ts to be struck anew, the decision must come from

Congress and not from this Court.” Precisely the same

conclusion should be drawn here.

Furthermore, there is no reason to assume that the ad-

ministrative and judicial review process painstakingly con-

structed and constantly adjusted by Congress is less than

a fully adequate remedy for an erroneous denial of

benefits at a preliminary stage of that process, even if the

purported consequences are somehow removed from that

denial per se and even if the challenge is cast in “due proc-

ess” terms. Cf. Mathews v. Eldridge, 424 U.S. 319,

339-340 (1976).®

b. A Bivens remedy is inappropriate in the present

context for a reason which did not obtain in Bush. The

Court began in Bush by stressing that “Congress ha[d] not

expressly precluded the creation of such a [Bivens] remedy

by declaring that existing statutes provide the exclusive

mode of redress” (462 U.S. at 373). See also id. at 377-378;

Carlson v. Green, 446 U.S. 14, 19 (1980). In this case, on

the other hand, Congress has done just that. 42 U.S.C.

(Supp. III) 405(h) provides:

The findings and decision of the Secretary after a

hearing shall be binding upon all individuals who

® See also Parratt v. Taylor, 451 U.S. 527, 537-544 (1981). In Par-

rat, this Court declined to find that plaintiff had established a viola-

tion of the Due Process Clause of the Fourteenth Amendment, where

the claimed deprivation occurred as the result of the unauthorized

failure of agents of the State to follow an established state procedure.

The Court specifically noted (id. at 544) that the state remedies may

not have provided plaintiff with all of the relief which he might have

claimed in an action brought under 42 U.S.C. 1983. Nevertheless, the

Court ruled that “[t}he remedies provided could have fully compen-

sated the [plaintiff] for the property loss he suffered, and we hold that

they are sufficient to satisfy the requirements of due process” (451

U.S. at 544). See also id. at 555 n.1 (citations omitted) (Marshall, J.,

concurring in part and dissenting in part) (“To be sure, the state

remedies would not have afforded [plaintiff] all the relief that would

have been available in a § 1983 action. | nonetheless agree with the

majority that ‘they are sufficient to satisfy the requirements of due

process.’ ”); Hudson v. Palmer, 468 U.S. 517, 530-536 (1984). Simi-

larly, the remedies provided in Section 405(g) and the regulations

issued pursuant to that section not only could have provided

respondents with full relief from the denial of rights under the statute,

but did so.

were parties to such hearing. No findings of fact or

decision of the Secretary shall be reviewed by any per-

son, tribunal, or governmental agency except as

herein provided. No action against the United States,

the Secretary, or any officer or employee thereof shall

be brought under Sections 1331 or 1346 of title 28 to

recover On any claim arising under this subchapter.

Section 405(h), therefore, has two provisions which bar

Bivens actions. Its second sentence plainly precludes the

review of any finding of fact or other decision by the

Secretary except as provided in the Social Security Act.

Section 405(g), in turn, is the on/y mechanism in the Act

for the review of such decisions. Moreover, the full

remedy available under Section 405(g) is the retroactive

payment of disability benefits wrongfully ter-

minated—which respondents have already received.

Under these provisions, judicial review of administrative -

decisions on claims for social security benefits is

unavailable except where expressly authorized by the

Social Security Act. See Califano v. Sanders, 430 U.S. 99,

110 (1977) (Stewart, J., concurring); S. Rep. 734, 76th

Cong., Ist Sess. 52 (1939); H.R. Rep. 728, 76th Cong., Ist

Sess. 43-44 (1939).

Similarly, the third sentence of Section 405(h) precludes

suits brought under 28 U.S.C. 1331 “to recover on any

claim arising under” the social security disability program.

Notwithstanding the contrary conclusion of the court of

appeals (App., infra, 6a), it is plain that respondents’

Bivens action under Section 1331 “arises under” the

disability benefits statute. This suit is exclusively concern-

ed with the Secretary’s administration of that statute and

with rights created under it. lronically, the court of ap-

peals appears to rest its contrary decision on the fact that

respondents’ benefits under the statute have already been

restored, thus leading it to the erroneous inference that

any remaining action relating to the earlier denial of

benefits does not arise under the Act (see App., infra, 6a).

Nor will this Court’s decisions under the statute support

the court of appeals’ decision. In Heckler v. Ringer, 466

U.S. at 615, 621-622, the Court held that plaintiffs’ claims

that the Secretary had violated their due process and

Statutory rights in denying medicare benefits “arose

under” the Social Security Act. The Court stressed that the

“arising under” language of Section 405(h) invokes a

“broad test,” which includes “any claims in which ‘both the

standing and the substantive basis for the presentation’ of

the claims is the Social Security Act.” 466 U.S. at 615

(quoting Weinberger v. Salfi, 422 U.S. 749, 761 (1975)).

The Court noted that plaintiffs had an “adequate remedy

in Section 405(g)” (466 U.S. at 617), had not “raise[d] a

claim wholly ‘collateral’ to their claim for benefits” (id. at

618), and had “no colorable claim that an erroneous denial

of * * * benefits * * * cannot be remedied by the later pay-

ment of benefits” (ibid.). The Court concluded that plain-

tiffs’ claim “must be construed as a ‘claim arising under’

the Medicare Act because any other construction would

allow claimants substantially to undercut Congress’ care-

fully crafted scheme” (id. at 621). See also id. at 615;

Weinberger v. Salfi, 422 U.S. at 756-762.

Such reasoning is directly applicable to this case. Just as

plaintiff Ringer’s request for declaratory relief “arose

under” the statute even though his claim was to ensure

future benefits, respondents claims here arise under the

Statute even though their complaint is about the

nonreceipt of past benefits. See 422 U.S. at 621. By

holding otherwise, the court of appeals has “invit{ed]

[respondents] to bypass the exhaustion requirements of

the * * * Act” (ibid.).

This Court warned in Weinberger v. Salfi that the

“sweeping and direct” jurisdictional bar embodied in the

“arising under” language of Section 405(h) cannot be

avoided simply because plaintiffs cast their allegations in

constitutional terms (422 U.S. at 757, 760-761). That, of

course, is all that respondents here have done. Their “due

process” claim can be made by any claimant unhappy with

an adverse benefit decision at any level of the ad-

ministrative process. “Emotional distress” can be claimed

every time an adverse benefits decision is rendered, and of

course the denial of benefits will always cause the denial of

what could have been bought with them —respondents’

“loss of food, shelter and other necessities proximately

caused by [petitioners’] denial of benefits” (see App.,

infra, 3a n.2). Cf. Heckler v. Ringer, 466 U.S. at 627.

There is no other component to respondents’ claim. Surely

a cogstruction of Section 405(h) that would allow any

challenge to a benefits decision to be split into two

parts—one governed by Section 405(g), the other im-

mediately amenable to resolution as a Bivens claim in

district court — would defeat any purpose of that statute.

Thus, the purpose as well as the language of the statute

would be defeated by the court of appeals’ counterintuitive

reading.

2. The potential impact of the court of appeals’ deci-

sion — both on the federal courts and on the Social Secur-

ity Administration —is dramatic. The SSA hearing system

is “‘probably the largest adjudicative agency in the

western world.’ ” Heckler v. Campbell, 461 U.S. 458, 461

n.2 (1983) (citation omitted). See also Califano v. Boles,

443 U.S. 282, 283 (1979) (“As an exercise in governmental

administration, the social security system is of un-

precedented dimension.”); Richardson vy. Perales, 402

U.S. 389, 399 (1971) (“The system’s administrative struc-

ture and procedures, with essential determinations

numbering into the millions, are of a size and extent dif-

ficult to comprehend.”). SSA processes some two million

disability claims each year. See Heckler v. Day, 467 U.S.

at 106. We are advised by HHS that in excess of 100

million other claims, under the Medicare, AFDC and

retirement programs, are also processed annually. Under

the court of appeals’ decision, an adverse ruling at any

stage of any one of these cases can give rise to a Bivens suit

for delay in payment or emotional distress.? The burden of

this litigation on the Social Security Administration and

the courts would be staggering.

The effects of this decision within the Ninth Circuit,

where it has precedential effect, and anywhere else that it

is found persuasive, may include a substantial drain on

agency resources to defend these Bivens actions. In addi-

tion, agency personnel who make disability (and pre-

sumably other eligibility) determinations will be inhibited

in the performance of their duties, because they will know

that their actions can result in individual damage actions

against them. Cf. Bush, 462 U.S. at 388-389. This is true

for both factual and policy determinations, and thus will

affect all levels of program administration.

3. While the court of appeals’ decision is clearly wrong

and seriously disruptive, we suggest that this petition be

held pending disposition of Cooper v. Kotarski (petition

to be filed no later than May 13, 1987), which also raises

issues regarding the proper application of Bush v.

* The court of appeals’ decision here also produces the rather

anomalous result that claimants may seek damages for emotional

distress resulting from an alleged deprivation of due process by the

Secretary (and other officials) for any adverse benefit decision — even

when, as here, the decision challenged is not the Secretary’s final deci-

sion and even when the final decision turns out to be fully favorable to

the claimant. This result, of course, is entirely inconsistent with the ex-

haustion requirements of Section 405(g). See Weinberger v. Salfi, 422

U.S. at 756-759.

Lucas.'* In Kotarski, a probationary federal employee

brought a Bivens action to obtain review of an employ-

ment action for which he was expressly denied any remedy

under the civil service laws. We argue there that, pursuant

to the principles established in Bush, a Bivens action can-

not be used to secure rights that Congress expressly de-

clined to extend to such probationary employees.

As we explain in our petition in Kotarski, that case

presents the Court with a clear conflict in the circuits on an

issue of great and recurrent practical importance to the

government. It clearly requires this Court’s review, and we

believe that such review is likely to provide guidance in the

application of Bush v. Lucas in the context of this case.

The present case, by contrast, presents no intercircuit con-

flict. While we believe that absent Kosarski this case would

merit full review, in the interest of conserving the Court’s

plenary docket, we recommend that this petition be held

pending disposition of Kotarski. Should review be denied

in that case, or if the Court’s opinion there is not

dispositive of this case, we urge that this petition be

granted.

‘ A copy of our petition in Aotarski will be sent to opposing

counsel at the time it ts tiled.

CONCLUSION

The petition for a writ of certiorari should be held pend-

ing the Court’s disposition of Cooper v. Kotarski, petition

for a writ of certiorari to be filed May 13, 1987.

Respectfully submitted.

CHARLES FRIED

Solicitor General

RICHARD K. WILLARD

Assistant Attorney General

DONALD B. AYER

Deputy Solicitor General

ROGER CLEGG

Assistant to the Solicitor General

WILLIAM KANTER

HOWARD S. SCHER

Attorneys

MAy 1987

APPENDIX A.

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

No. 84-2828

DC No. CIV 82-528 GLO ACM

James Cuiicky, Dora ADELERTE, AND SPENCER HARRIS,

PLAINTIFFS-APPELLANTS,

Vv.

RICHARD SCHWEIKER, FORMER SECRETARY OF HEALTH AND

HUMAN Services; JOHN SVAHN, FORMER COMMISSIONER OF

THE SocIAL SECURITY ADMINISTRATION; AND WILLIAM R.

Sims, DiRECTOR OF THE ARIZONA DISABILITY

DETERMINATION SERVICE, IN THEIR INDIVIDUAL CAPACITIES,

DEFENDANTS-APPELLEES.

Appeal from the United States District Court

for the District of Arizona

Alfredo C. Marquez, District Judge, Presiding

Argued and Submitted December 2, 1985

Phoenix, Arizona

[Filed Aug. 12, 1986}

OPINION

Before: BROWNING, SNEED, and HUG, Circuit

Judges.

HUG, Circuit Judge:

This case concerns the personal liability of certain state

and federal officials and their immunity from damages

arising from their alleged violations of citizens’ constitu-

(la)

tional rights. Appellants, whose Old Age, Survivors and

Disability Insurance (“OASDI") and/or Supplemental

Security Income (“SSI”) disability benefits had been ter-

minated during disability reviews in 1981, appeal the

dismissal of their claims that appellees, the Secretary of

Health and Human Services, the Commissioner of the

Social Security Administration, and the Arizona state of-

ficial who administered these disability benefits programs,

unconstitutionally violated their rights under the Fifth

Amendment in terminating appellants’ benefits.

Appellants received disability benefits under Title II of

the Social Security Act, 42 U.S.C. § 401 ef seg. (1982), or

under the Supplemental Security Income program, 42

U.S.C. § 1381 ef seg. (1982). In 1980, Congress estab-

lished, effective January 1, 1982, a continuing disability

review (“CDR”) process to insure that only those in-

dividuals whose medical conditions still warranted

disability status received payment; however, the Secretary

of Health and Human Services (the “Secretary” and

“HHS,” respectively) implemented the CDR process in

March, 1981. Appellants’ disability benefits were ter-

minated by the CDR process; however, they were

ultimately reinstated, either through the administrative ap-

peals process or under the provisions of the Social Security

Disability Benefits Reform Act of 1984, Pub.L. No.

98-460, 98 Stat. 1794.

On August 20, 1982, appellants James Chilicky,

Spencer Harris, and Doris Adelerte, together with seven

other similarly situated persons, filed suit against Richard

Schweiker, then HHS Secretary, John Svahn, Social

Security Commissioner, and William R. Sims, Arizona

Director of Disability Determinations.' The complaint

' Both Schweiker and Svahn have since resigned, and pursuant to

Federal Rule of Civil Procedure 25(d), Margaret Heckler and Martha

McSteen were substnuted for the named appellees. The district court

found that the substnuted appellees were not personally served wih a

asserted that the appellees ordered, sanctioned, or im-

plemented numerous practices, in violation of federal law

and the Fifth Amendment in administering the CDR proc-

ess, which culminated in the termination of appellants’

benefits. The appellants alleged, inter alia, that the ap-

pellees: (1) improperly accelerated the starting date of the

CDR process from the statutory effective date of January

1982 to the earlier date of March 1, 1981; (2) illegally

nonacquiesced in the law of this circuit; (3) failed to apply

any uniform written standards in implementing the CDR

process; (4) failed to render decisions consistent with

allegedly dispositive evidence; and (5) used an impermissi-

ble “quota system” under which state agencies were re-

quired to terminate a certain number of recipients.’

On November 15, 1982, prior to submission of an answer,

appellees filed a motion to dismiss under Fed. R. Civ. P.

12(b)(6), asserting, inter alia, a lack of both subject matter

jurisdiction and personal jurisdiction for insufficiency of

service of process.

copy of either the complaint or the amended complaint and,

therefore, dismissed Heckler and McSteen in their individual capacity

from the lawsuit. Appellants do not contest this ruling on appeal. We

note, however, that the district court correctly ruled that, without per-

sonal service in accordance with Fed. R. Civ. P. 4(d), the district court

lacked jurisdiction to render a personal judgment against these ap-

pellees. See Hutchinson v. United States, 677 F.2d 1322, 1328 (9th

Cir. 1982). .

* The complaint sought: (1) certification of a class of disability

benefit recipients whose benefits had been terminated through the

CDR process; (2) a declaratory judgment that the CDR process, as

then administered, violated federal law and the Fifth Amendment's

due process clause, (3) preluminary and permanent injunctions enjoin-

ing the CDR process, (4) writs of mandamus directing the appellees to

perform duties owed plaintiffs under federal law and the Fifth

Amendment, (5) restoration of benefits; and (6) monetary awards for

damages for “emotional distress and for loss of food, shelter and

other necessities proxmmately caused by defendants’ denial of benefits

without due process -

On July 15, 1983, the district court stayed the pro-

ceedings pending disposition of Lopez v. Heckler. See

Lopez v. Heckler, 725 F.2d 1489, 1493-96 (9th Cir. 1984)

(detailing procedural history), vacated and remanded __

U.S. __, 105 S. Ct. 583, 83 L.Ed.2d 694 (1984). The

district court vacated the stay on April 6, 1984.

Because of the Lopez decision and actions taken by

HHS prior to, and as a result of, the 1984 Disability

Benefits Reform Act, appellants withdrew their requests

for class certification and for declaratory and injunctive

relief. Thus, the only claim remaining was their claim for

money damages against appellees in their individual

capacities for due process violations in implementing the

CDR process. Appellants’ surviving claim is predicated on

the constitutional tort theory of Bivens v. Six Unknown

Named Agents, 403 U.S. 388 (1971). On October 16, 1984,

the district court dismissed the claim, ruling as a matter of

law that all appellees were insulated from liability under

the doctrine of qualified immunity. The district court

found that the acceleration of the CDR process, the prob-

lems encountered at the state level, and the standards

utilized in the review process, including the purported

nonacquiescence policy of the Secretary in decisions of the

Ninth Circuit, were not violations of clearly established

Slatutory or constitutional rights of which a reasonable

person should have known.

DISCUSSION

A. Jurivdiction

1. Subject Matier

Appellees argue that the district court lacks subject mat-

ter jurisdiction of appellants’ constitutional tort cause of

action. Their argument is predicated on the assumption

that appellants’ action “arises under” the Social Security

Disability Act; thus, appellees contend, section 405(h), 42

U.S.C. § 405(h) (1982), precludes appellants’ lawsuit. We

disagree.

Section 405(g), 42 U.S.C. § 405(g) (1982) provides that

“[a}ny individual, after any final decision of the Secretary

made after a hearing to which he was a party .. . may

obtain a review of such decision by a civil action ...

brought in the district court of the United States. . .” and

that the “court shall have the power to enter, upon the

pleadings and transcript of the record, a judgment af-

firming, modifying, or reversing the decision of the

Secretary... .”

Section 405(h) states:

The findings and decision of the Secretary after a

hearing shall be binding upon all individuals who

were parties to such hearing. No findings of fact or

decision of the Secretary shall be reviewed by any per-

son, tribunal, or governmental agency except as

herein provided. No action against the United States,

the Secretary, or any officer or employee thereof shall

be brought under section 1331 or 1346 of Title 28 to

recover on any claim arising under [Title Il of the

Social Security Disability Act].

We agree with appellees that appellants’ claim for

money damages may not be raised under section 405(g);

that section does not expressly grant the district court the

power to award money damages to remedy the emotional

distress caused by erroneous administrative decisions or

processes. Rather, the only remedy available under section

405(g) is the retroactive payment of disability benefits that

were wrongfully terminated. Appellants have already had

their benefits retroactively restored by the Secretary; they

now seek further compensation by instituting a lawsuit for

money damages. Section 405(g) affords no such relief.

We disagree, however, with appellees’ contention that

section 405(h) prohibits any non-section 405(g) action

against the appellees from being brought under the Fifth

Amendment due process clause.’ Section 405(h) only

precludes actions “arising under” Title Il of the

Security Disability Act, a section 405(g)-type action for

disability benefits, from being instituted prior to exhaus-

tion of administrative remedies. Heckler v. Ringer, 466

U.S. 602, 104 S. Ct. 2013, 2021-22 (1984); Weinberger v.

Salfi, 422 U.S. 749, 764-66 (1975). Appellants do not pur-

sue their remaining claim in an effort to have their disabili-

ty benefits restored; this has been done. Rather, they seck

damages for constitutional violations purportedly com-

mitted by appellees in terminating appellants’ disability

benefits. Consequently, the action does not arise under

Title Il of the Social Security Disability Act and is thus not

barred by section 405(h). The district court has subject

matter jurisdiction under 28 U.S.C. § 1331 over ap-~

pellants’ due process claim against all appellees. Ellis v.

Blum, 643 F.2d 68, 75-76 (2d Cir. 1981). See also Kuehner

v. Schweiker, 717 F.2d 813, 816-17, 819 (3d Cir. 1983),

vacated and remanded on other grounds, _._ U.S. ___.,

105 S. Ct. 376 (1984); Ostroff v. State of Florida Dept. of

Health and Rehabilitation Services, $54 F . Supp. 347, 354

(M.D. Fla. 1983) (federal defendants).

' Arguably, section 405(hy's ban on actions “against the Unned

States, the Secretary, or any officer of employer thereof” does not ap-

ply to suits agaunst state officials, such as Sims. Because the state

defendant Sums administers the federally-funded disatiiny program, «

can be argued that Sums was acting under color of federal law as an

agemt of the Secretary and, as such, is within the ambu of section

405(h) For jurmdictional purposes only, we conclude that Sims was

acting under color of federal law. “To hold otherwise arguably would

mvne appl rants for Tule Il benefits to crcumvent sections 405(g) and

(h) by Bringing sun under section 1331 against the state officials m-

stead of the Secretary " Eilts «. Blam, 643 F.2d 68, 76 (2d Cw

1981)

2. Personal Jurisdiction

Although not expressly decided by the district court,

Schweiker and Svahn contend that venue in the District

Court of Arizona was improper and that the district court

lacked personal jurisdiction over them because (1) the is-

suance of service of process was unauthorized and, thus,

defective; and (2) there were not sufficient minimum con-

tacts between the federal defendants and the State of

Arizona necessary to satisfy the requirements of /nterna-

tional Shoe Co. v. Washington, 326 U.S. 310, 316 (1945),

and the Arizona long-arm statute.‘ Appellants argue that

the district court did have personal jurisdiction over

Schweiker and Svahn in their individual capacities, but

that even if service of process was insufficient, personal

jurisdiction under the Arizona long-arm statute was lack-

ing, and venue was improper, these appellees waived their

objections under Fed. R. Civ. P. 12(g) and (h).

Fed. R. Civ. P. 12, and specifically subdivisions (g) and

(h), promote the early and simultaneous presentation and

determination of preliminary defenses. Rule 12(g) requires

that a party who raises a defense by motion prior to an

* answer raise all such possible defenses in a single motion;

omitted defenses cannot be raised in a second, pre-answer

* Arizona’s long-arm statute, Ariz. R. Civ. P. 4(e)(2), provides:

When the defendant is a resident of this state, or is a corpora-

tion doing business in this state, or is a person, partnership, cor-

poration or unincorporated association subject to suit in a com-

mon name which has caused an event to occur in this state out of

which the claim which is the subject of the complaint arose, serv-

ice may be made as herein provided, and when so made shall be

of the same effect as personal service within the state. In case of a

corporation or partnership or unincorporated association, service

under this Rule shall be made on one of the persons specified in

Section 4(d)(6).

motion.> Rule 12(h) imposes a higher sanction with respect

to the failure to raise the specific defenses of (1) lack of

personal jurisdiction, (2) improper venue, (3) insufficiency

of process, and (4) insufficiency of service of process.* If a

party files a pre-answer motion, but does not raise one of

the defenses enumerated above, the party waives the omit-

ted defense and cannot subsequently raise it in his answer

or otherwise. See Myers v. American Dental Association,

695 F.2d 716, 720-21 (3d Cir. 1982), cert. denied, 462 U.S.

1106 (1983); Rauch v. Day & Night Manufacturing Corp.,

576 F.2d 697, 701 (6th Cir. 1978); 2A J. Lucas & J.

Moore, § 12.23, at 2446-47 (2d ed. 1982).

[A}ny time defendant makes a pre-answer Rule 12

motion, he must include, on penalty of waiver, the

defenses set forth in subdivisions (2) through (5) of

Rule 12(b). If one or more of these defenses are omit-

ted from the initial motion but were “then available”

to the movant, they are permanently lost. Not only is

defendant prevented from making it the subject of a

> Fed. R. Civ. P. 12(g) provides that:

A party who makes a motion under this rule may join with it any

other motions herein provided for and then available to him. If a

party makes a motion under this rule but omits therefrom any

defense or objection then available to him which this rule permits

to be raised by motion, he shall not thereafter make a motion bas-

ed on the defense or objection so omitted, except a motion as pro-

vided in subdivision (h)(2) hereof on any of the grounds there

Stated.

* Fed. R. Civ. P. 12(h) provides that:

(1) A detense of lack of jurisdiction over the person, improper

venue, insufficiency of process, or insufficiency of service of

process is waived (A) if omitted from a motion in the cir-

cumstances described in subdivision (g), or (B) if it is neither

made by motion under this rule nor included in a responsive

pleading or an amendment thereof permitted by Rule 15(a) to be

made as a matter of course.

second preliminary motion but he may not even assert

the defense in his answer.

5 C. Wright & A. Miller, Federal Practice and Procedure,

§ 1391 at 852-53 (1969).

Appellees maintain that their first responsive pleading,

Motion to Dismiss filed on August 20, 1982, preserved

their objection to lack of jurisdiction over the person. We

disagree. The only ground stated in the motion to dismiss

was the lack of service of process, or a Rule 12(b)(5)

defense. The specific defenses —lack of jurisdiction of the

person under the Arizona long-arm statute, a Rule

12(b)(2) defense, and improper venue, a Rule 12(b)(3)

defense — were not raised, and are thus waived. Appellees

have abandoned their Rule 12(b)(5) defense, absence of

service of process, and now claim that service of process

against these appellees for money damages is not author-

ized by statute. This specific defense was not raised,

however, in the motion to dismiss; this objection is also

waived.

We do not accept the argument that by objecting to the

lack of service of process, appellees are deemed to have

raised a Rule 12(b)(2) defense. Rules 12(b)(4) and (5) were

not designed to challenge personal jurisdiction allegedly

obtained pursuant to a long-arm statute; rather, they were

designed to challenge irregularities in the contents of the

summons (Rule 12(b)(4)) and irregularities in the manner

of delivery of the summons and complaint (Rule 12(b)(5)).

Appellees’ personal jurisdiction challenge was made pur-

suant to Rule 12(b)(5); they now contest personal jurisdic-

tion under Rule 12(b)(2). Appellees were required, but

failed, to consolidate all their Rule 12 defenses in their mo-

tion to dismiss. As such, they waived their Rule 12(b)(2)

defense.

10a

B. Immunity of the Appellees’

The appellees argued, and the district court agreed, that

they are entitled to qualified immunity on at least two of

appellants’ claims: acceleration of the CDR process and

nonacquiescence in the law of this circuit. With qualified

immunity, federal officials performing discretionary func-

tions generally are shielded from liability for civil damages

insofar as their conduct does not violate “clearly estab-

lished” statutory or constitutional rights of which a

reasonable person would have known. Harlow v. Fitz-

gerald, 457 U.S. 800, 818-19 (1982); Guerra v. Sutton, 783

F.2d 1371, 1374 (9th Cir. 1986). Under Harlow, the stand-

ard is the objective reasonableness of the federal official’s

conduct. Harlow, 457 U.S. at 818. “Even defendants who

violate constitutional rights enjoy a qualified immunity

that protects them from liability for damages ‘unless it is

further demonstrated that their conduct was unreasonable

under the applicable standard.’ ”" Capoeman v. Reed, 754

F.2d 1512, 1513 (9th Cir. 1985) (quoting Davis v. Scherer,

468 U.S. 183, 104 S. Ct. 3012, 3018 (1984)). In this case,

the federal defendants are entitled to immunity if they can

prove “that they acted under a reasonable (even if

mistaken) belief that what they were doing was lawful.”

Guerra, 783 F.2d at 1374 (emphasis in original) (citing

Bilbrey v. Brown, 738 F.2d 1462, 1466-67 (9th Cir. 1984)).

The issue, as properly framed by the district court, is

’ All defendants were sued in their individual as well as official

capacity. The district court ruled that the appellants’ action against

appellees in their individual capacit:.. was defeated by the application

of the doctrine of qualified immunity to these appellees. Although the

district court did not directly address appellants’ action against ap-

pellees in their official capacities, the doctrine of sovereign immunity

must be found to have been implicitly applied by the district court. To

the extent that appellees were sued in their official capacities, these

claims are barred by the doctrine of sovereign immunity. See Gi/beri

v. DaGrossa, 756 F.2d 1455, 1458-59 (9h Cir. 1985).

whether the law at the time of the appellees’ alleged

unlawful and unconstitutional activity clearly prohibited

such conduct.* We review de novo the district court’s

order, dismissing the appellants’ Bivens claims on the

ground that appellees as a matter of law are entitled to

qualified immunity. Bilbrey v. Brown, 738 F.2d 1462,

1467 (9th Cir. 1984).

The district court expressly found that (1) the accelera-

tion of the CDR process, and (2) the nonacquiescence in

the law of the Ninth Circuit were not violations of clear

statutory or constitutional law so that a reasonable person

would have acted otherwise, and granted to all appellees

qualified immunity from appellants’ claims.

The parties agree that Congress lawfully authorized the

CDR process. Appellants object, however, to the Social

Security Administration’s acceleration of the CDR proc-

ess, complaining that the states were ill-equipped to handle

this increase in caseload. As the district court noted, Con-

gress elected to delay implementation of the CDR process

to allow the states time to employ and train personnel to

handle the projected increase in disability review termina-

tions. This staffing problem at the state level, however, ex-

tended beyond the congressionally-enacted effective date.

Appellants’ complaint, therefore, cannot be with the ac-

celeration itself, but with the quality of the decisions

rendered. Appellants’ claimed erroneous disability ter-

minations were redressable through the administrative

review process; each appellant successfully utilized this

mechanism. Neither the lawfully authorized CDR process,

nor the acceleration of that program deprived appellants

of any statutory or constitutional rights.

* Neither the parties nor the district court address the merits of the

appellants’ Bivens claims. As the merits of the Bivens claims are not

before us on appeal, we do not pass on the legitimacy of appellants’

claimed constitutional deprivations.

12a

Appellants also challenge the actual review procedures

adopted and utilized by the appellees, contending that

these procedures differ from court-established standards.’

Specifically, appellants argue that the Secretary lacks

authority to nonacquiesce in decisions of the courts. We

do not need to address this issue, however, because under

Harlow and Capoeman we are concerned only with the

question of whether appellees’ conduct, at the time it oc-

curred, was clearly a violation of appellants’ statutory and

constitutional rights.

Harlow’s “clearly established” standard requires that, in

the absence of binding precedent, the court look to all

available decisonal law, including decision of state courts,

other circuit courts, and district courts to determine

whether the law is clearly established. Capoeman, 754

F.2d at 1514; see also Ward v. County of San Diego, 783

F.2d 1385, 1387 (%h Cir. 1986) (amended June 16, 1986).

Absent binding precedent, the court should also evaluate

the likelihood that the Supreme Court or this circuit would

have reached the same result as courts that had already

considered the issue. Capoeman, 754 F.2d at 1515; Ward,

slip op. at 5.

* The Secretary issued formal notice of nonacquiescence im

Finnegan v. Matthews, 641 F.2d 1340, 1345 (9th Cir. 1981), and Parti

v. Schweiker, 669 F.2d 582, 586-87 (9th Cir. 1982), which hold that

under the applicable statutes, the Secretary was required, before ter-

minating a recipient's Social Security benefits, to come forward with

evidence that a recipient's medical condition had improved. The

Secretary advised all administrative law judges that the Social Security

Administration's policy, tyat termination of benefits is called for if

evidence shows the reciprent is not disabled under current criteria, was

to be followed in all Crcun Courts of Appeal, even the Ninth Circuit,

without obeying the Ninth Circun’s requirement that proof of im-

provement im the clammant’s medical condition must be made before

termination of diabiluy benefits. SSR 82-10c; SSR 82-1459.

— ——

l3a

Our examination of relevant statutory and decisional

law at the time of the termination of benefits compels us to

concur with the district court’s evaluation: the law was not

sufficiently clear in 1981 so as to expose to civil liability

under Bivens those public officials, who in effect ter-

minated disability benefits. At that time, there were no

reported cases that held nonacquiescence by the Executive

Branch in judicial decisions to be clearly unlawful. The of-

ficials charged with the responsibility of implementing and

administering the CDR process were confronted with a

congressionally mandated program designed to terminate

benefits, a Presidential directive to implement that pro-

gram some 10 months earlier than its effective date, and

an administrative policy guideline instructing Social

Security Administration officials to ignore certain case

authority. In view of these factors, we find that appellees

acted within the bounds of Harlow’s reasonable person

standard. The constant tension between the Executive and

Judicial Branches over the appropriate standard for ter-

minating disability benefits, together with the Secretary's

nonacquiescence policy, rendered assessment of the legal-

ity of the CDR process by even a legal scholar extremely

difficult. Most government officials are not charged with

“the kind of legal scholarship normally associated with law

professors and academicians. A reasonable person stand-

ard adheres at all times.” Ward, slip op. at 6.

The complaint alleges that some or all of the appellees

violated the due process rights of the appellants in these

other respects:

1. Knowing use of unpublished criteria and rules

and standards contrary to the Social Security

Act.

2. Intentional disregard of dispositive favorable

evidence.

3. Purposeful selection of biased physicians and

staff to review claims.

Denial of benefits based on the type of disabling

impairment.

8. Unreasonable delays in receiving hearings after

termination of benefits.

It cannot be determined as a matter of law that the ap-

pellants could prove no state of facts under the. allega-

tions that resulted in violations of their due process rights

and consequent damages. Nor does the present state of the

record establish as a matter of law that these appellees

would be shielded from liability by qualified immunity.

Although we agree with the district court that qualified

immunity precludes some of appellants claims, the case

must be remanded for further proceedings on those claims

above mentioned.

The decision of the district court is AFFIRMED in part,

REVERSED in part, and REMANDED for further pro-

ceedings.

APPENDIX B

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

No. CIV 82-528 GLO ACM

JAMES CHILICKY, ET AL, PLAINTIFFS,

Vv.

MarGaret HECKLER, SECRETARY OF HEALTH AND HUMAN

SERVICES, ET AL, DEFENDANTS.

[Filed Oct. 16, 1984]

ORDER

The defendants have moved to dismiss this action. The

suit Originally involved claims by a class of recipients of

social security benefits against the Secretary of Health and

Human Services, the Commissioner of the Social Security

Administration and the director of the Arizona Disability

Determination Service. The claims arose when the Ad-

ministration under President Reagan ordered a large

number of disability reviews for recipients of social secu-

rity.

The plaintiffs asserted various claims for relief claiming

that the review procedure violated their Sth amendment

due process rights. Plaintiffs originally sought declaratory

and injunctive relief plus damages in the form or retroac-

tive benefits and compensation for emotional distress.

Through various legislative, judicial and administrative

actions, the need to determine the declaratory and injunc-

tive requests is no longer necessary. Each of the named

plaintiffs had their benefits reinstated retroactively.

Counsel for the plaintiffs has also withdrawn his motion

to certify the class, leaving only a suit by ten named plain-

tiffs for emotional distress.

16a

Suit was originally filed against Richard Schweiker,

John Svahn and Robert Sims in their official and in-

dividual capacities. During the pendency of this action,

Margaret Heckler succeeded Richard Schweiker as

Secretary of Health and Human Services. Martha A.

McSteen succeeded John Svahn as Commissioner of

Social Security. Under Rule 25(d) of the Federal Rules of

Civil Procedure these parties were substituted for the

named plaintiffs.

The complaint in this action was served on Schweiker,

Svahn and Sims. At no time were the substituted defend-

ants Heckler and McSteen served although substitution

occurred more than a year and a half ago. Dismissal as to

these two defendants in their individual capacities is

therefore appropiate. See Rule 4(j), Federal Rules of Civil

Procedure. The court finds that there is no just cause for

failure to serve during that time period.

One ofthe grounds asserted for dismissal of this action

is immunity, both absolute and qualified. This court finds

that plaintiffs’ emotional distress claims are barred by the

application of qualified immunity and therefore the

defendants’ motion to dismiss this action is granted.

To find qualified immunity for these governmental of-

ficials, it must be determined whether the conduct violated

“clearly established statutory or constitutional rights of

which a reasonable person would have known.” Harlow v.

Fitzgerald, 102 $.Ct. 2727, 2739 (1982). The issue then is

whether the law at the time of the alleged violations clearly

prohibited the conduct of the defendants. It must be con-

cluded that the law did not so clearly provide.

The parties agree that the action taken by the Depart-

ment of Health and Human Services was authorized by

Congress. See Pub. L. No. 96-265 (1980). However, the

date of implementing such a program was accelerated by

the Administration. As the pleadings indicate, Congress

desired to delay implementation in order to allow the state

a a nooo, ~a

17a

agencies to hire and train sufficient personnel to handle

the increased workload. See report entitled “Oversight of

Social Security Disability Terminations” by the Senate

Subcommittee on the oversight of Governmental Manage-

ment at page |. The President ordered the implementation

of the program on March 1, 1981 rather than the January

1982 effective date proposed in the legislation.

The plaintiffs claim that it was knowingly improper to

require the state review agencies to handle the increased

case load. This court holds that it was not a violation of

clear statutory or constitutional rights. The fact that the

states were still ill equipped to handle the caseload well

into 1982, as the plaintiffs state in their opposition papers,

indicates that no relief is available. lt appears that it is the

failure of the states to provide the necessary personnel

even well after the Congressional authorization would

have taken effect, that caused a large portion of the delay

asserted by the plaintiffs. At that point, it was clearly

within the statutory duty of the defendants to have the

state agencies review the caseload that they did. Relief is

not appropriate on this ground as the courts will not in-

tervene in the administrative procedures. Heckler v. Day, -

104 S.Ct. 2249 (1984). The early implementation is then

not sufficient to justify a Bivens type action for damages.

Plaintiffs also contend that the review procedures

adopted by the defendants differed from standards im-

posed by the courts. The Secretary has in fact issued formal

notice of non-acquiesence [sic] in decisions from the 9th

Circuit. See Social Security Rulings 82-10c and 82-49c; Par-

ti v. Schweiker, 669 F.2d 582 (9th Cir. 1982) and Finnegan

v. Mathews, 641 F.2d 1340 (9th Cir. 1981).

The plaintiffs challenge the Secretary's ability to “non-

acquiesce” [sic] in case law. Neither party has cited any

cases to this court indicating that such policy is per se in-

valid. In fact, the courts have been reluctant to intervene

in administrative procedures. See Heckler v. Day, supra,

(courts will not issue mandatory injunction requiring

Social Security appeals to be resolved in 90-day statutory

period); Heckler v. Ringer, 104 S.Ct. 2013 (1984) (exhaus-

tion of administrative remedies required prior to judicial

review).

Defendants’ implementation of the review in fact oc-

curred prior to the 9th Circuit rulings cited above. Lopez

v. Heckler, 725 F.2d 1489 (9th Cir. 1984). Although the

Constitution provides that the Courts shall be the inter-

preters of Federal Law, no case has been cited holding that

non-acquiesence [sic] by the Executive branch is clearly in-

valid. This court notes that it is a common practice at

other agencies such as the National Labor Relations Board

and the Department of the Treasury in Internal Revenue

matters. lt cannot be concluded therefore that defendants’

conduct, at the time it occurred initially, was clearly a

violation of plaintiffs’ statutory and constitutional rights

so that a reasonable person would have acted otherwise.

All defendants must therefore be protected by qualified

immunity from damages relief as provided in Harlow v.

Fitzgerald, supra.

Since there are no claims stated upon which any plain-

tiff may obtain relief, the case must be dismissed.

IT 1S ORDERED that the defendants’ Motion to

Dismiss is granted.

DATED this 16th day of October, 1984.

/s/ A .. Zz

Alfredo C. Marquez

United States District Judge

19a

APPENDIX ©

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

No. 84-2828

DC No. CIV 82-528 ACM

James Cunicky, Dora ADELERTE, AND Spencer Hares.

PLAINTIFFS-APPELLANTS,

RICHARD SCHWEIKER, FORMER SECRETARY OF HEAT TH AND

HUMAN Services, Jon SVAHN, FORMER COMMISSIONER OF

THE SociaAL SECURITY ADMINISTRATION; AND Witiam R.

Sims, Director OF THE Arizona Disasiity

DETERMINATION SERVICE, IN THEIR INDIVIDUAL CAPACITIES,

DEFENDANTS. APPELLEES.

[Filed Dec. 19, 1986)

JUDGMENT

Appeal from the United States District Court for the

District of Arizona (Tucson).

THIS CAUSE came on to be heard on the Transcript of

the Record from the United States District Court for the

District of Arizona (Tucson) and was duly submited.

ON CONSIDERATION WHEREOF, It is now here or-

dered and adjudged by this Court, that the judgment of

the said District Court in this Cause be, and hereby is af-

firmed in part, reversed in part and remanded.

A TRUE COPY

ATTEST DEC 16 1986

CATHY A. CATTERSON

Clerk of Court

by: /s/ OSCAR LAGLE

Oscar Lagle

Deputy Clerk

Filed and entered August 12, 1986

2la

APPENDIX D

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

No. 84-2828

DC No. CIV 82-528 GLO ACM

James CHILICKY, SPENCER HARRIS AND Dora ADELERTE,

PLAINTIFFS-APPELLANTS,

MARGARET HECKLER, SECRETARY OF HEALTH AND HUMAN

SERVICES; JOHN SVAHN, COMMISSIONER, SOCIAL SECURITY

ADM.; AND WILLIAM R. Sims, Director, ARIZONA

DitsaBiLiTy DETERMINATION SERVICE, DEFENDANTS-

APPELLEES.

Appeal from the United States District Court for the

District of Arizona

[Filed Dec. 8, 1986]

Before: BROWNING, SNEED, and HUG, Circuit

Judges.

The panel, as constituted in the above case, has voted

unanimously to deny the petition for rehearing and to re-

ject the suggestion for a rehearing en banc.

22a

The full court has been advised of the en banc sug-

gestion and no judge of the court has requested a vote on

it. Fed. R. pp. P. 35(b).

The petition for rehearing is denied and the suggestion

for a rehearing en banc is rejected.

23a

APPENDIX E

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

No. CIV-82-528-TUC-ACM

JAMES CHILICKY, ET AL, PLAINTIFFS,

Vv.

MARGARET HECKLER, DEFENDANTS.

[Filed Oct. 16, 1984]

JUDGMENT IN A CIVIL CASE

Before: ALFREDO C. MARQUEZ

X Decision by Court. This action came to hearing before

the Court with the judge named above presiding. The

issues have been heard and a decision has been rendered.

IT iS ORDERED AND ADJUDGED

Judgment is entered in favor of the defendants and

against the plaintiffs.

Clerk: W. J. Furstenau

(By) Deputy Clerk

/S/ RENEE LUDEKE

Renee Ludeke

Date 10/16/84

405(g), provides:

24a

APPENDIX F

STATUTORY PROVISIONS INVOLVED

Section 205(g) of the Social Security Act, 42 U.S.C.

Judicial review.

Any individual, after any final decision of the

Secretary made after a hearing to which he was a

party, irrespective of the amount in controversy, may

obtain a review of such decision by a civil action com-

menced within sixty days after the mailing to him of

notice of such decision or within such further time as

the Secretary may allow. Such action shall be brought

in the district court of the United States for the

judicial district in which the plaintiff resides, or has

his principal place of business, or, if he does not

reside or have his principal place of business within

any such judicial district, in the United States District

Court for the District of Columbia. As part of his

answer the Secretary shall file a certified copy of the

transcript of the record including the evidence upon

which the findings and decision complained of are

based. The court shall have power to enter, upon the

pleadings and transcript of the record, a judgment af-

firming, modifying, or reversing the decision of the

Secretary, with or without remanding the cause for a

rehearing. The findings of the Secretary as to any

fact, if supported by substantial evidence, shall be

conclusive, and where a claim has been denied by the

Secretary or a decision is rendered under subsection

(b) of this section which is adverse to an individual

who was a party to the hearing before the Secretary,

because of failure of the claimant or such individual

to submit proof in conformity with any regulation

prescribed under subsection (a) of this section, the

25a

court shall review only the question of conformity

with such regulations and the validity of such regula-

tions. The court may, on motion of the Secretary

made for good cause shown before he files his

answer, remand the case to the Secretary for further

action by the Secretary, and it may at any time order

additional evidence to be taken before the Secretary,

but only upon a showing that there is new evidence

which is material and that there is good cause for the

failure to incorporate such evidence into the record in

a prior proceeding; and the Secretary shall, after the

case is remanded, and after hearing such additional

evidence if so ordered, modify or affirm his findings

of fact or his decision, or both, and shall file with the

court any such additional and modified findings of

fact and decision, and a transcript of the additional

record and testimony upon which his action in modi-

fying or affirming was based. Such additional or

modified findings of fact and decision shall be re-

viewable only to the extent provided for review of the

orignial findings of fact and decision. The judgment

of the court shall be final except that it shall be sub-

ject to review in the same manner as a judgment in

other civil actions. Any action instituted in accord-

ance with this subsection shall survive notwithstanding

any change in the person occupying the office of Sec-

retary Or any vacancy in such office.

2. Section 205(h) of the Social Security Act, 42 U.S.C.

(Supp. I11) 405(h), provides:

finality of Secretary's decision.

The findings and decision of the Secretary after a

hearing shall be binding upon all individuals who

were parties to such hearing. No findings of fact or

decision of the Secretary shall be reviewed by any pe: -

son, tribunal, or governmental agency except as

26a

herein provided. No action against the United States,

the Secretary, or any officer or employee thereof shall

be brought under section{s] 1331 or 1346 of title 28 to

recover on any claim arising under this subchapter.

US GOVERNMENT PRINTING OFFICE 1987 — 161 46340309

OPPOSITION

BRIEF

James Chilicky, ET AL.

Wut E. Moras

Attorney for Respondents

Southern Arizona Legal Aid, Ine.

155 East Alameda Stree:

Tucson, AZ 85701-1299

(602) 623-9461

coos Lae ee

Petitioners are Richard Schweiker, former Secretary

of Health and Human Services; John Svahn, former Com-

missioner of the Social Security Administration ; and Wil

liam R. Sims, Director of the Arizona Disability Deter.

mination Service. Respondents are James Chilicky, Dora

Adelerte, and Spencer Harris.

‘i

TABLE OF CONTENTS

Statement Of The Case

This Court Should Not Grant The Petition _.

Coodusion

—— oes

TABLE OF AUTHORITIES

Page

Cases:

Bivens v. Siz Unknown Named Federal Narcotics

Agents, 403 U.S. 388 (1971) a passim

Bowen v. Michigan Academy my Family Physi-

cians, — U.S. —, 106 S.Ct. 2133 (1986) 17

Bush v. Lucas, 462 U.S. 367 (1983) 0 passvm

Carey v. Piphus, 435 U.S. 247 (1978) 6, 12,13

Carlson v. Green, 446 U.S. 14 (1980) —_ . 9

Ellis v. Blum, 643 F.2d 68 (2d Cir. 1981)... 2

Flemming v. Nestor, 363 U.S. 603 (1960) 0 20

Heckler v. Day, 467 U.S. 104 (1984) ao YS

Heckler v. Ringer, 466 U.S. 602 (1984) 17, 18, 19, 20

Mathews v. Eldridge, 424 U.S. 319 (1976) _____.6, 16, 18

19, 20, 22

Medical Fund-Philadelphia Geriatric Society v.

Heckler, 804 F.2d 33 (3rd Cir. 1986) . —

United States v. Gilman, 347 U.S. 507 (1954) 00 —si88

United States v. Standard Oil Co., 332 U.S. 301

(1947) 8,9

Weinberger v. Salfi, 422 U.S. 749 (1975) 15, 16, 17,

18, 19, 20

Constitution, Statutes and Regulations:

US. Const.:

Amend. I —_ au ©

Amend. V (Due Process Clause) 2, 3, 11, 17

TABLE OF AUTHORITIES—Continued

Page

Social Security Act:

Tit. I, 42 U.S.C. (& Supp. II1) 4 401 et seq. 5

42 U.S.C. § 405(g) 4, 15, 16, 21

42 U.S.C. § 406(h) ci

42 U.S.C. (Supp. IIT) §423 00

Tit. XVI, 42 U.S.C. (& Supp. IIT) $1381 et seq. 5

28 U.S.C. § 1331 dG, 7, 18, 19

No. 86-1781

In The

Supreme Court of the United States

October Term, 1986

Richard Schweiker, ET AL., PETITIONERS

James Chilicky, ET AL.

RESPONSE TO THE PETITION FOR WRIT OF

CERTIORARI TO THE UNITED STATES COURT

OF APPEALS FOR THE NINTH CIRCUIT

Respondents James Chilicky, Dora Adelerte and Spen-

cer Harris hereby oppose the Petition for a Writ of Cer-

tiorari to review the judgment of the United States Court

of Appeals for the Ninth Circuit in this case.

—o

STATEMENT OF THE CASE

1. Respondents are recipients of disability benefits

paid under Title II or Title XVI of the Social Security Act

of 1934, as amended.' All had regularly received benefits

prior to 1980, when they underwent continuing disability.

reviews (‘‘CDRs’’) conducted to determine whether they

still met the disability requirements of federal law. As the

petition for certiorari notes, the Arizona Disability Deter-

mination Service (‘‘ADDS’’), headed by Petitioner Sims,

had immediate responsibility for both the CDRs and an

initial decision on Respondents’ continued medical eligibil-

ity under Title II or Title XVI. Petitioner Sims and his

staff acted, however, at the continuing direction of federal

administrators. See Ellis v. Blum, 643 F.2d 68, 70, 72, 75-

76 (2d Cir. 1981).

This threshold review culminated in termination of

Respondents’ disability benefits. Respondents pursued

available administrative remedies and won reinstatement

of benefit payments.

They also filed suit against Petitioners alleging, inter

alia, that Petitioners had knowingly conducted, directed or

authorized a CDR process which resulted in initial benefit

terminations without due process of law. In part, the Com-

plaint indicated that these violations of the Fifth Amend-

ment inhered in decisions by Petitioners Schweiker and

Svahn to accelerate the CDR process, thus forcing the

ADDS to dispose of far more cases than its staff could re-

' The Petition adequately cites to all matters, also set forth

herein, by referencing the accompanying appendices, which re-

view with minimal fairness to recipients. The Complaint

also cited Petitioners’ willful refusal to acquiesce in the

law of the circuit, when conducting CDRs, as a further

denial of due process.

The Court of Appeals correctly noted, however, that

Respondents alleged additional violations of the Fifth

Amendment in the course of CDRs, including:

1. Knowing use of unpublished criteria, rules and

standards contrary to the Social Security Act.

2. Intentional disregard of dispositive evidence

favorable to beneficiaries.

3. Purposeful selection of biased physicians and

staff to review claims.

4. Imposition of quotas, requiring a minimum

number of terminations regardless of the evidence in

any given case.

5. Failure to review impartially adverse de-

cisions.

6. Arbitrary reversal of favorable decisions.

7. Denial of benefits based on the type of dis-

abling impairment.

8. Unreasonable delays in receiving hearings af-

ter termination of benefits.

The District Court dismissed all corresponding dam-

age claims’ on the ground that they were barred by Peti-

2 Respondents had previously withdrawn claims for declara-

tory and injunctive relief on behalf of a class of disability recip-

(Continued on following page)

tioners’ qualified immunity from any such liability. In

doing so, however, it expressly considered only the allega-

tions of improper acceleration of the CDR process and non-

acquiescence in the law of the circuit.

and necessitated by allegedly unconstitutional benefit ter-

minations afforded all the process due Respondents.

The Court of Appeals denied Petitioners’ Motion for

Rehearing and suggestion for a rehearing en banc, which

raised the question of subject matter jurisdiction over Re-

spondents’ damage claims.

THIS COURT SHOULD NOT GRANT THE PETITION

factors are not present here, nor does 4 405(h) compel the

same result in this case.

Petitioners warn of countless damage actions, disrupt-

she can never obtain more thar. nominal damages in a Biv-

ens action claiming an original deprivation without due

process. Carey v. Piphus, 435 U.S. 247 (1978).

This principle provides an adequate safeguard against

an avalanche of litigation proceeding without regard for

the normal operation of the administrative process. In-

deed, it positively encourages pursuit of administrative

remedies as an essential predicate to any Bivens action a

recipient might plausibly choose to maintain.

Furthermore, success in the administrative arena

merely wins reinstatement of modest benefit payments.

An inordinate number of severely-disabled persons, depen-

dent on subsistence incomes regained only through a con-

test with the SSA bureaucracy, will scarcely have the

wherewithal to sue its representatives in an outpouring of

subsequent Bivens actions.

Petitioners characterizes the damage claims in this

ease as bordering on the frivolous, apparently because Re-

spondents eventually did regain benefits through the ad-

ministrative process. The implication that they can no

longer point to any uncompensated losses, entitling them

to damages, is untenable. Mathews v. Eldridge, 424 US.

319, 331 (1976) (unconstitutional termination of bene-

fits may ‘0! st losses that simply cannot be compensated

through a »-*reactive award after an administrative hear-

ing).

This Court should decide the instant petition on its

own merits, rather than postponing its consideration until

it rules on the petition pending in Cooper v. Kotarski. The

question presented in Kotarski deals with application of

Bush to a Bivens claim based on disciplinary action against

a probationary fed. ral employee. 1: merely invites further

consideration of the Bush doctrine in its traditional setting.

Whatever the disposition, it cannot aid materially in de-

termining whether Bush should control in the far different

context of social welfare programs.

la. The litigation in Bush implicated three compet-

ing interests, each of considerable significance in itself.

The Federal Government depends, for its very functioning,

on a loyal, efficient and well-disciplined civil service. These

underpinnings are inevitably weakened if civil -ervants

can pursue a Bivens remedy against their superiors. The

judicial process affords a limited, unsatisfactory means

of determining the ultimate impact on the Government's

own functioning. Bush, 462 U.S. at 388-59.

Conversely, adequate protection for the constitutional

rights of personnel forming a vast national workforce re-

mains a paramount concern in a society dedicated to basic

civil liberties for all citizens. Neither loyalty, morale nor

efficiency thrives if civil servants are remediless in the

face of adverse employment action flouting those guaran-

tees. Bush, 462 U.S. at 382-86. Such considerations be-

come especially significant where, as in Bush itself, their

exercise of First Amendment rights animates personnel

disputes. The public interest in learning the truth about

governmental affairs peerliarly within the knowledge of

civil servants may suffer real damage, if federal employees

are silenced by untoward and unchecked sanctions. Id., 462

U.S. at 390-91 n. 37.

Congress has recognized the necessity for delicate, but

comprehensive, adjustments among these unusually im-

portant national interests, which remain in constant ten-

of damage remedies would invade a domain properly re-

served for the legislature. /¢., 403 U.S, at 396, citing

United States v. Gilman, 347 U.S. SOT (1954) and Uwited

States v. Standard Oil Co., 332 U.S. 301 (1947). Resolu-

tion of the claims in both Gilman and Standard Oi ulti-

-— 6 —s—

mately turned on the nature and significance of juridical

relationships between the United States and its employees.

Congress had the demonstrable, paramount interest as well

as expertise in regulating them, and in determining whether

a breach of their attendant legal duties should be answer-

able in damage actions. Bush, 462 U.S. at 378-80, citing

Bivens, supra and emphasizing that its references to u-

man as well as Standard Oil foreshadowed the principles,

if not the result, handed down in Buch itself.

Bivens neither cited nor alluded to any sphere of fed-

eral activity, outside Government employment, presenting

special circumstances in which the damage remedy i broad:

ly sanctioned might prove unavailable, as a matter of sound

judicial deference to Congress. Id., 403 U.S. at 396-06.

Bush represented the logical application of doctrines can’

vassed in Bivens. It did not inaugurate a retreat from the

principle that Bivens remedies are the norm, rather than

the exception, where federal officials commit constitutional

torts. See, eg., Bush, 462 U.S, at 377-78, citing Carleon ©.

Green, 446 U.S. 14 (1980) (Bivens remedy lies against fed.

eral employees even if injured party may sue the Govern

ment itself for damages caused by the same tortious com

duet). In short, this Court has never yet precluded nor

warned against a Bivens remedy outside the minutely reg

ulated, peculiarly-sensitive context provided by the Gov.

ernment's relations with its own employees.

b. Petitioners’ attempts to draw a close analogy be-

tween the considerations operative here and in Bush do

not succeed in raising a substantial question of federal law.

Their reliance on Heckler v. Day, 467 US. 104, 111-15

(1984) is misplaced because it ignores the narrow focus

of the decision. Dew originated as a challenge to delays

in processing disability benefit claims through the admin

istrative appellate process. /4., 467 U.S. at 110-11 That

was the particular problem which had “inspired almost

annual Congressional debate."’ J4., 467 U.S. at 112.

Such continued legislative attention to it proved =

nificant simply because it revealed Congressional intent

with unusual clarity: Congress had repeatedly considered

but expressly rejected measures establishing mandatory

deadlines for claims adjudications, I4., 467 U.S. at 111,

117-18 and 2.30. Where Congress consistently focuses on

deficiencies in one facet of agency operations it has ample

power to address, but regularly withholds a particlar, pro-

posed remedy, the judiciary should not act in its stead by

ordering the very steps the legislature has explicitly re-

jected. Jd. 467 U.S. at 119.

Congress has never grappled, over and again, with

the extent to which the administrative process adequately

compensates individuals for all losses caused by wrongful

termination of their disability benefits. The legislature

has never deliberated on any form of redress except even:

tual reinstatement of payments, coupled with an award of

benefits denied in the interim. Provisions to that effect

appeared in the legislation creating the disability benef!

programs now at issue. They have not occupied Congres

sional attention at any subsequent time. They have cer:

tainly not attracted continuing debate, demonstrating an

affirmative Congressional intent to foreclose any addi-

tional redress for the victims of unlawful terminations.

Petitioners cite recent amen’ oats to the Socal Se-

curity Act affecting operation of agency appeal procedures

im termination cases, See, eg. 42 U.S.C. (Supp. IIT) § 423

(a). They analogize them to the constant, close regulation

Congress has pursued in adjusting relations between the

Government and its civil servants. The amendments on

which they rely merely seek to minimize the incidence of

erroneous terminations. If they succeed in furthering that

objective, they will reduce the potential for Biecms actions

alleging that agency officials terminated benefits without

due process of law.

The amendments do not, however, reflect continuing

Congressional oversight of the compensation indi vidual

should receive in either administrative or judicial forums,

if they are nonetheless denied property interests through

agency action violating the Fifta Amendment. Bush. by

contrast, turned on the fact that Congress had expressly

considered and then decided, in comprehensive terms, every

specific form of redress the administrative process had te

afford victims of unconstitutional acts provable in agen y

adjucheations themselves.

c. The Federal Government does not maintain jurich.

cal or other relationships with disability reeiprents remotely

similar to those obtaining between the United States and

ite civil servants. It obviously does not depend, for its

own functioning, on constant, fine adjustments in its deal:

ings with severely disabled citizens. Those transactions

are largely matters of bureaucratic routine. (mee the Se:

cial Security Administration finds applicants eligible for

benefits, it simply sends them periodic payments in pre-

scribed amounts dutil they no longer meet the relatively

few requirements of substantive law.

Reciments do not continuously render serviers or any

other performance to the Government, which might lead

to the complex disputes reflected in the conveluted admin-

istrative and judicial proceedings at issue in Bush, 462

US. at 369-72 The public interest im civil service rege-

lations protecting valuable sources of information on na-

tienal affairs has no analog in the present context. Hence,

Congress need not resort te repeated, intricate adjust-

ments among governmental, individual and public inter-

ests, which it may deem best served by the fullest possible

administrative redress for unconst:(utional acts jeopardis-

ing all three.

Congress has not in fact done sa, ewen where, as here,

the Government pernodieally evaluates the continued med-

ical eligibility of SSA recipients and terminates any it

then finds unqualified for the program. The legislature

has merely established and, occasionally, extended certain

safeguards against erroneous cessations, It has never

specifically addressed the separate question of the redress

due victims of unconstitutional deprivations. They may

obtain lest payments through an administrative appeal,

but actly the same procedure is open te any terminated

recient who was not victimized by unconstitutional acts.

Henee, the remedy «amply cannet embedy a Congressional

determination of the only redress appropriate im cases such

as that at bar.

Allowance of a Berens remedy does net upset any bal-

ance of interests struck by this scheme: A terminated re-

ciprent who fails to re-establish eligibality through its mech-

ahis™ms cannot recover more than nominal damages for any

deprivation inflicted witheat due process. Carey v. Piphus,

supre. Uf it bas any effect im this particular instance, a

Bivens remedy actually encourages terminated recipients

to pursue the one force of administrative redress Con-

gress has considered, before they can assert any substan-

tial basis for a damage action. In Bush, by contrast, a

Bivens remedy for First Amendment violations appeared

an immediate, attractive alternative to lengthy adminis-

trative proceedings : The potential recovery on such a claim

did not depend upon a prior agency adjudication deter-

According to the Government, the SSA administrative

scheme also affords Respondents adequate compensatory

relief for any deprivations they have suffered. See Bush,

462 U.S. at 388. Indeed, Petitioners imply that their op-

ponents lack any real damages precisely because they pre-

vailed in the administrative appellate process. In fact,

these procedures merely enable a wrongfully-terminated

recipient to regain benefits that should never have been

denied him in the first place. Their loss certainly does not

represent the only harm individuals suffer when govern-

ment officials deprive them of property interests without

due process. Carey, 435 U.S. at 262-64 and n. 20 (damages

for emotional distress, including mental suffering or emo-

tional anguish, recoverable when caused by unjustifiable

deprivation accomplished without due process).

Petitioners do not claim that this principle is inap-

plicable in Bivens actions. They do not deny that a bene-

fit cut-off represents an objective, quantifiable injury,

separate and distinct from subjective distress attributable

to the same unconstitutional action. Carey, 435 U.S. a

262-64.

Unlike the petitioner in Bush, 462 US « 86, Re-

spondents could not present their constitutional claims to

agency adjudicators. Hence, Congress has never had oc-

casion to determine whether SSA administrative remedies

afford the fullest manageabie redress for all injuries flow-

ing from the unconstitutional acts of Government officers.

The legislature could not possibly have made a judgment,

now entitled to judicial deference, that the optimum pos-

sible redress is availabie in agency forums. |

Petitioners warn that a Bivens remedy will deter

federal officials from properly discharging their duties

in continuing disability investigations. The Government

thus draws another unpersuasive parallel to Bush. Offi-

cials responsible for disciplinary action against a civil ser-

vant claiming a denial of her constitutional rights must ap-

pear and defend their conduct in trial-type administrative

proceedings. /d., 462 U.S. at 386-88. If that already sub-

stantial obligation were accompanied by a need to defend

Bivens suits, the cumulative burden on administrators

might well deter them from proper disciplinary action in

future cases. /d., 462 U.S. at 388.

The administrative process governing adjudication of

disability benefit claims is non-adversarial, by design.

Agency officials responsible for benefit termination need

not appear at any stage to defend, present evidence on or

argue in support of their decisions. The first and only

occasion on which they might have to do so would arise in

a Bivens action itself. This Court has never credited the

notion that a Bivens remedy should be denied because the

mere obligation to defend the litigation might chill forth-

right administrative action in future encounters with the

same subject matter.

In sum, Petitioners fail to establish any special circum-

stances, within a tenable reading of this Court’s prece-

dents, counseling against a judicial grant of the Bivens

remedy Respondents obtained.

d. According to Petitioners, Congress has, how-

ever, expressly declared its intent to limit Respondents to

the redress afforded by the administrative process. They

rely on 42 U.S.C. §§ 405(g) and (h), read against a few

decisions of this Court.

Petitioners do not invoke either provision to mount a

direct, unqualified attack on subject matter jurisdiction

over Bivens claims. Rather, they deem the jurisdictional

concerns of §§ 405(g) and (h) plainly indicative of a Con-

gressional intent to foreclose all damage claims traceable

to benefit terminations.

Petitioners note that the second sentence of § 405(h)

shields the Secretary's findings of fact and decisions from

any form of review, except that provided elsewhere in

§ 405. Section 405(g) sets forth the permissible means of

obtaining such review. Since §405(g) merely contem-

plates proceedings for restoration of lost benefits, Con-

gress must have intended that as the sole, permissible re-

dress for terminations, whatever their actual consequences.

The second sentence of § 405(h) clearly refers to the

first. See Weinberger v. Salfi, 422 U.S. 749, 757-58 (1975).

The opening sentence, in turn, restricts the scope of the

second to ‘‘findings and decisions of the Secretary after a

hearing."” Emphasis supplied. Respondents, however,

never disputed the findings or decisions reached in their

cases after administrative hearings. Rather, their Bivens

claim arose from the initial actions of state officials in

summarily terminating their benefits and forcing them to

seek Secretarial hearings, subject to the extraordinary de-

lays recounted in Day, 467 U.S. at 111-18 and acknowledged

as constitutionally significant in Mathews v. Eldridge, 424

U.S. at 341-42. Those actions did not amount to the See-

retary’s findings or decisions after any hearing within the

contemplation of §405(h). See Weinberger v. Salfi, 422

U.S. at 764-67.

This Court need not decide whether Petitioners’ com-

bined reading of Bush and § 405(h) might have some color-

able appeal in a setting other than that now before it. The

argument simply does not demonstrate that Congress in-

tended to bar all relief, except benefit restorations, where

the Secretary’s state delegates lawlessly* extinguish entitle-

ments with the conscious approval of the Secretary and the

The Court of Appeals permitted maintenance of a cor-

responding Bivens action under 28 U.S.C. $1331. That,

Petitioners contend, flouts other provisions of 42 U.S.C.

§§ 405(¢) and (h), which must, therefore, be read as a

Congressional prohibition against Bivens remedies.

In part, they attack the Circuit's allowance of § 1331

jurisdiction as an open invitation to bypass administrative

remedies at the core of the adjudicatory scheme. As Re-

spondents have shown, a Bivens claim based on due process

violations lacks any tangible value unless a disability re-

cipient not only exhausts SSA administrative remedies,

but prevails at the conclusion of the process, before prose-

cuting a damage action.

¢ Eg. by deliberately failing to follow the procedures re-

extend ey dae process batare os eral ovidiantiany hansien on on

ensuing termination, as set forth in Eldridge, 424 U.S. at 332-47.

The Government relies primarily on Heckler v. Ringer,

466 U.S. 602 (1984) to support its reading of the interplay

between 42 U.S.C. § 405(h) and 28 U.S.C. $1331. Ringer

(466 U.S. at 615-16) construed 42 U.S.C. § 1395ii, the Medi-

care provision incorporating the third sentence of 4 405(h).

According to Petitioners, Ringer established that litigants

cannot evade the strictures of § 405, by pleading constitu-

tional infirmities in the methods used to determine benefit

claims, and thus invoke federal question jurisdiction. The

Government concludes that Respondents have resorted to

that very technique in presenting their Bivens claims.

Petitioners, however, do not even cite Bowen v. Michs-

gan Academy of Family Physicians, — U.S. —, 106 8. Ct.

2133 (1986). There, physicians challenged Medicare regu-

lations differentiating the benefit amounts payable for

similar professional services. They claimed, in part, that

the rules violated the Fifth Amendment. The Sixth Circuit

held and, on remand, reaffirmed that 28 U.S.C. § 1331 pro-

vided jurisdiction over the subject matter, notwithstand-

ing this Court’s decision in Ringer. Id., 106 8. Ct. at 2135.

Citing Weinberger v. Salfi, 422 U.S. at 756-62 and

Ringer, supra, the Government argued that 42 U.S.C.

§ 405(h) ‘‘prevents any resort to the grant of general fed-

eral question jurisdiction contained in 28 U.S.C. § 1331."

Michigan Academy, 106 8. Ct. at 2140; footnote omitted.

This Court rejected that absolute view. In creating the

Medicare program, Congress hed clearly manifested an in-

tent to preclude judicial review of administrative decisions

fixing individual benefit amounts. It had not expressed an

equally clear intent to bar parties from obtaining review

where they presented ‘‘substantial . . . constitutional chal.

lenges to the Secretary's administration of Part B of the

Medicare program."’ /d., 106 S. Ct. at 2144; footnote

omitted.

The fact remains that Ringer (466 U.S. at 607-609)

also arose from a constitutional challenge to a Secretarial

policy prohibiting certain Medicare reimbursements. This

Court then held that 42 U.S.C. § 1395ii must be construed

and applied in exactly the same manner as 42 U.S.C.

§405(h). It followed that § 1331 jurisdiction did not lie

over claims indistinguishable from those at issue in Mich:-

gan Academy. Ringer, 466 U.S. at 615-16. In Michigan

Academy, 106 S. Ct. at 2141, the Court avoided a result

Ringer apparently mandated by simply noting that while

§ 1395ii was modeled on § 405(h), the two provisions are

adapted to different statutory schemes. Nothing in

Ringer suggested such a ready means of distinguishing the

effect each has on § 1331 jurisdiction, especially in the

same operative circumstances.

The conclusion that ‘Michigan Academy . . . severely

restricted the decision in Rimger’’ seems inescapable.

Medical Fund-Philadelphia Geriatric Center v. Heckler,

804 F.2d 33, 38 (3rd Cir. 1986). It is even more doubtful

that Ringer, a case ultimately dealing with the jurisdiction-

al consequences of § 1395ii, remains a leading pronounce-

ment on the extent to which § 405(h) forecloses § 1331 jur-

isdiction. That is especially true where an action brought

under § 1331 challenges routine methods of determining

benefit claims. Petitioners’ Bivens claims, like those pre-

sented in Michigan Academy, had precisely that founda-

tion.

In any event, neither Ringer nor such antecedents as

Weinberger v. Salfi and Mathews v. Eldridge assist Pe-

titioners’ reading of § 405(h) and $1331. As Salfi (422

U.S. at 760-61) observed, the ultimate objective of litiga-

tion in this area’ is ordinarily receipt of social security

benefits. Since accompanying constitutional claims are

merely designed to remove a legal impediment to an award,

they “‘arise under” Title II of the Social Security Act,

within the meaning of 4 405(h). /d. In cases typified by

Eldridge (424 U.S. at 331), continued receipt of benefits

or protecting an SSA entitlement, they would never be

tendered. /d.; accord, Ringer, 466 US. at 614-15.

That is simply ot this case. Respondents lacked any

tangible interest in maintaining Biers’ claims based on

due process violations until they had re-established their

entitlement to continued benefits. At that juncture, all

efforts at winning benefits, whether by overcoming some

impediment to their receipt, or by eliminating obstacles to

adequate protection of uninterrupted payments, were nec-

essarily at a complete end. Respondents’ sole objective

was an award of damages compensating them for such in-

juries as emotional distress, occasioned by a deprivation of

benefits they had already reversed. Nothing in Ringer,

Salft or Eldridge® supports the notion that corresponding

claims arose under Title Il. Rather, those cases analyzed

the ‘‘arising under’’ proviso based on a premise—receipt

of benefits remains the ultimate unachieved goal of con-

stitutional litigation—that could not obtain in this Bivens

action.

2. Even if the Court grants the petition in K otarski,

the ultimate disposition of the case will have little, if any,

significance here. Presumably, the Government thinks

otherwise because the Court might not only grant it, but

hold that even though a probationary federal employee

lacks the administrative remedies discussed in Bush, he

is still without a Bivens remedy for unconstitutional in-

juries to his employment interests. Petitioners would un-

doubtedly analogize his circumstances to those of Respon-

dents: They, too, could not seek redress for emotional

distress, stemming from deprivations of property without

due process, in the only administrative forum open to them.

Congress intended that result and no other in both instanc-

es, or so Petitioners will apparently argue.

® Sprety acting, in ent, Gus 0 due grees calm con be

maintained novo in District Court, even if it was not pre-

viously raised in the course of fully exhausting administrative

remedies. Eldridge, 424 U.S. at 329 n. 10, citing to Flemming v.

Nestor, 363 U.S. 603 (1960).

——

Assuming that this extended line of conjecture is

sound, such developments in Kotarski will have little

consequence for the instant case. They would merely af-

firm that as Bush concluded, Congress has repeatedly con-

sidered all conceivable questions touching on the redress

due any federai employee claiming unconstitutional mis-

treatment at the hands of his superiors. Its decision not

to afford particular redress for probationary employees

should again enjoy judicial deference. ‘The history of

the social security program does not include similar leg-

islative attention to the redress properly due terminated

disability recipients, especially where they are denied

constitutional rights by initial agency action extinguishing

longstanding entitlements.

Respondents respectfully submit that this Court should

rule on the instant petition without regard to any action

it may take in Kotarski.

CONCLUSION

After successfully exhausting administrative remedies,

Respondents sought damages under Bivens for unredressed

injuries flowing from a threshold denial of continued bene-

fits. This Court has never indicated that such a claim

runs afoul of either the doctrine enunciated in Bush or

proper administration of 42 U.S.C. §§ 405(g) and (h).

Nothing in the applicable statutory scheme, as amended,

supports Petitioners’ reliance on Bush, nor do its provi-

sions otherwise bar a Bivens remedy here.

At bottom, the Government is arguing that its repre-

sentatives may direct initial benefit terminations, flout

the due process requirements Eldridge (424 U.S. at 332-47)

contemplated prior to an oral hearing on the deprivations,

and still remain unaccountable for every ensuing injury,

other than eventual restoration of benefits to those vic-

tims who persevere in regaining the very property they

should never have lost. It would require far more per-

suasive evidence than Petitioners adduce to conclude that

Congress affirmatively approved or desired such untoward

results, especially in fashioning a program of income main-

tenance for dependent, severely-disabled citizens.

Respondents request that the Court deny certiorari in

the instant case.

Respectfully submitted,

Sovruern Arizona Lecat An, Inc.

/s/ Wiut441,M E. Morris

William E. Morris

Attorney for Respondents

June 1987

PETITIONER’S

BRIEF

~ Sees Coot 8

(\\ FILED

No. 86-1781 VY DEC 8 987

Iu the Supreme Court of the United <i

OCTOBER TERM, 1987

RICHARD SCHWEIKER, ET AL., PETITIONERS

Vv.

JAMES CHILICKY, ET AL.

ON WRIT OF CERTIORARI TO THE UNITED STATES

COURT OF APPEALS FOR THE NINTH CIRCUIT

BRIEF FOR THE PETITIONERS

CHARLES FRIED

Solicitor General

RICHARD K. WILLARD

Assistant Attorney General

DONALD B. AYER

Deputy Solicitor General

MICHAEL K. KELLOGG

Assistant to the Solicitor General

WILLIAM KANTER

HOWARD 8S. SCHER

Attorneys

Department of Justice

Washington, D.C. 20530

(202) 633-2217

QUESTION PRESENTED

Whether a Bivens remedy should be implied for

alleged due process violations in the denial of social

security disability benefits.

(1)

PARTIES TO THE PROCEEDINGS

The petitioners are Richard Schweiker, former

Secretary of Health and Human Services; John

Svahn, former Commissioner of Social Security; and

William R. Sims, Director of the Arizona Disability

Determination Service. Respondents are James

Chilicky, Dora Adelerte, and Spencer Harris.*

* In the original complaint there were, besides respondents,

seven other plaintiffs. These seven, who did not pursue the

appeal to the Ninth Circuit, were Atanacio Alamanza, Arthur

Flynn, Donald Bond, Demitrio Higuera, Joseph Tellez, Bonnie

Bircher, and Connie Diaz.

TABLE OF CONTENTS

Statutory provisions involved ............----------

Statement:

A. The statutory and regulatory framework ___-__-_

1. Procedural provisions _.» .....__._______-_-

A disability claimant challenging the termination of

his benefits must follow the administrative and ju-

dicial review procedures prescribed by Congress

and may not also seek damages under an implied

constitutional cause of action against officials re-

sponsible for the termination .__..........--____

EE LLL, Oe

B. Congress has expressely declared that the Social

Security Act provides the exclusive mode of re-

dress for a wrongful termination of disability

C. Congress has completely occupied the field of

social security disability benefits with a care-

fully drawn, comprehensive set of procedures

that provide meaningful remedies for any con-

stitutional violations that might occur in the

processing of claims for benefits _._._.__._______

D. The sheer size of the social security system is a

special factor that counsels against judicial crea-

tion of a damages remedy _..-.......________

TABLE OF AUTHORITIES

Cases: Page

Bell v. Hood, 327 U.S. 678 (1946) -------------- 26

Bivens v. Six Unknown Fed. Narcotics Agents, 403

See passim

Bollman, Ex parte, 8 U.S. (4 Cranch) 75 (1807) -- 25

Bowen Vv. City of New York, No. 84-1923 (June 2,

ee 4,44

Bowen Vv. Michigan Academy of Family Physicians,

No. 85-225 (June 9, 1986) .................-.- 32, 33

Bush v. Lucas, 462 U.S. 367 (1983) .._---------- passim

Butz v. Economou, 438 U.S. 478 (1978) --------- 45

Califano v. Boles, 443 U.S. 282 (1979) -_----- Eprene 46

Califano v. Sanders, 430 U.S. 99 (1977) ~---9, 32, 34, 39,

41-42

Califano v. Yamasaki, 442 U.S. 682 (1979) __-_-- 44

Carlson Vv. Green, 446 U.S. 14 (1980) .-.------- 27, 29, 30

Chappe" v. Wallace, 462 U.S. 296 (1983)-_-_----- 29-30

Davis v. Passman, 442 U.S. 228 (1979) ..--- 26, 27, 29, 30

De Leon v. Secretary of HHS, 734 F.2d 930 (2d

GR, Fe secteniceanideiiaintepentnns 14-15

Dotson v. Schweiker, 719 F.2d 80 (4th Cir. 1985) - 15

Ellis v. Blum, 643 F.2d 68 (2d Cir. 1981) ...----- 35

Gist v. Secretary of HHS, 736 F.2d 352 (6th Cir.

a 15

Goldberg Vv. Kelly, 397 U.S. 254 (1970) ..-------- 11, 40

Harlow v. Fitzgerald, 457 U.S. 800 (1982) ____20, 45, 47

Haynes v. Secretary of HHS, 734 F.2d 284 (6th

RMR Ra. EP Rs 2 onl a 15

Heckler v. Campbell, 461 U.S. 458 (1983) .______-_ 7,46

Heckler v. Day, 467 U.S. 104 (1984) -___-- 5, 6, 39, 41, 42,

44, 45, 46

Heckler v. Ringer, 466 U.S. 602 (1984).___-_- 7, 34, 35, 36,

37, 42, 44

Hudson v. Palmer, 468 U.S. 517 (1984)._-_----_- 43

Kuehner Vv. Schweiker, 717 F.2d 813 (3d Cir. 1983),

vacated and remanded, 469 U.S. 977 (1984)_.___- 14, 16

Kuzmin v. Schweiker, 714 F.2d 1233 (3d Cir.

SE canccmassbenssecsedaneseasiebcaseasse 15

Cases—Continued : Page

Lopez V. Heckler, 572 F. Supp. 26 (C.D. Cal. 1983),

aff’d and rev’d, 725 F.2d 1489 (9th Cir. 1984),

vacated and remanded, 469 U.S. 1082 (1984) _14, 16, 19

Mathews v. Eldridge, 424 U.S. 319 (1976) ___6, 10, 12, 14,

34, 36, 37, 43, 44, 48

Montana-Dakota Utilities Co. v. Northwestern Pub.

Serv. Co., 341 U.S. 246 (1951) .-.-----.------- 26

Parratt v. Taylor, 451 U.S. 527 (1981) ______---- 43

Patti v. Schweiker, 669 F.2d 582 (9th Cir. 1982) _ 15

Richardson Vv. Perales, 402 U.S. 389 (1971) -__-_5, 44, 46

Rush v. Secretary of HHS, 738 F.2d 909 (8th Cir.

ED cinuicinsttiibinin atid iantdnece 14

Sheldon v. Still, 49 U.S. (8 How.) 441 (1850) .___- 25

United States v. Erika, Inc., 456 U.S. 201 ...---- 35

United States v. Hudson & Goodwin, 11 US. (7

gO, FSCS AN er oe 25

United States v. Standard Oil Co., 332 U.S. 301

AAS et eet thine 42

Weinberger v. Salfi, 422 U.S. 749 (1975) ___33, 35, 36, 44

Constitution, statutes, regulations and rule:

U.S. Const.:

TESS SE A ae ae a 28

ELE AES Sa a 26

Amend. V (Due Process Clause) .......___-_- 12, 27

TNT 27

Amend. XIV (Due Process Clause) .________- 43

Act of Jan. 12, 1983, Pub. L. No. 97-455, 96 Stat.

2497: .

§ 2, 96 Stat. 2498-2499 (42 U.S.C. (& Supp.

SD MID. ‘Sidharth ventetuiliidetntnlintimiabeneyit 12-13, 40

§ 3, 96 Stat. 2499 (42 U.S.C. 421(i) (2)) ____- 13

§ 4, 96 Stat. 2499-2500 (42 U.S.C. 405(b) (2)) - 13

§ 6, 96 Stat. 2500-2501 (42 U.S.C. 421(i) (3))- 13

Act of Oct. 11, 1983, Pub. L. No. 98-118, 2, 97 Stat.

A Ri EE 13

Civil Rights Act of 1964, Tit. VII, 42 U.S.C. 2000e

et seq.:

S Tit, 48 USB.G. B6G0e-16 ... ...n200022-220~-- 27

§ 717(a), 42 U.S.C. 2000e-16(a)....-._-_--_- 27

vi vil

Statutes, regulations and rule—Continued : Page Statutes, regulations and rule—Continued : Page

Federal Tort Claims Act: Social Security Act Amendments of 1939, ch. 666,

28 U.S.C. 1881 .....------ 23, 24, 26, 33, 34, 35, 37, 38 6 SUSER), SS Stes, 1998 ~-------------------—- =

RRR ar ei ar ages 27 Social Security Disability Amendments of 1980,

i eueine 27 ne L. aa “+ own 94 Stat. 460 (42 .

. S.C. (& Supp. 0)

Social Security Act, 42 U.S.C. (& Supp. III) 301 Social Security Disability Benefits Reform Act of

et seq. : 1984, Pub. L. No. 98-460, 98 Stat. 1794:

Tit. II, 42 U.S.C. (& Supp. ITI) 401 et seq.__5, 8, 17, 23 § 2, 98 Stat. 1794-1797 (42 U.S.C. (Supp. IIT)

42 U.S.C. (& Supp. III) 405(b) -...--------- 7 I a lh SR 15

42 U.S.C. (& Supp. III) 405(b) (1) .--------- 7 Se Gr a BUS EEE cancccceccceccecce 16

er 13, 40 ELT 19

Te 2-3, passim § 5, 98 Stat. 1801 (42 U.S.C. (Supp. III) 421

42 U.S.C. (& Supp. IIT) 405(h) ____3-4, 21, 23, 24, 31, LEE ee SS CO ae 16

32, 33, 34, 36, 37, 38 § 6(d), 98 Stat. 1802 (42 U.S.C. (Supp. III)

et Lg oe 10 Ea a Ee I 17

42 U.S.C. (Supp. ITI) 421 note___--- 16, 17, 40, 41, 42 Ie VN 40

42 U.S.C. (& Supp. ITI) 421(a)._..__-------- 6, 18 § 7(a) (2), 98 Stat. 1803 (42 U.S.C. (Supp.

42 U.S.C. (& Supp. ITI) 421(d) ____--------- 6,8 A ee 16

42 U.S.C. (& Supp. IIT) 421(i) ......-------- 9, 44 § 10, 98 Stat. 1805 (42 U.S.C. (Supp. IIT)

I 13 | ee en 16

a 13 § 15, 98 Stat. 1808 (42 U.S.C. (Supp. III) 421

42 U.S.C. (Supp. ITI) 421(k) (1) _----------- 16, 41 Ee a a a. 16

42 U.S.C. (& Supp. III) 428 ............--.-- 4

42 U.S.C. (& Supp. IIT) 423(a) _.----------- 12 Se een eneseraalibemsantataicnee -

42 U.S.C. 428(a) (1)..--------------------- 9 20 C.F.R.:

42 U.S.C. (& Supp. ITI) 423(d) (2) (A) —----- 5 Pt. 404:

BUSS. GG) 200000<---.-.-.......- 10 Section 404.900(a) (5) _....._._._--______- 8

42 U.S.C. (Supp. III) 423 (f) eececceoes -- .15, 16, 41 Section 404.903 (1) es eae er ee 9

42 U.S.C. (& Supp. TM) 428(6) ---------.-. 18, 40 —................ }

0.0. (Supp. §) --------------- Section 404.905 .......______- a ae 6

42 U.S.C. (& Supp. III) 425 --..------------ 9 Sections 404.907-404.921................___ 6

Tit. XVI, 42 U.S.C. (& Supp. III) 1381 et seq.__5, 8, 17 Section 404.909(a) (1) ..----------.-------- 6

42 U.S.C. (& Supp. ITI) 1381a -.....--..---- 4 Section 404.917 - ----.-------------- ------- 13

42 U.S.C. (& Supp. IIT) 1382(a) --.----.---- 4 Section 404.920 .-..----------------------- 7

42 U.S.C. (& Supp. III) 1382¢ -....-..------ 16, 41 Section 404.981 ..-.----------------------- 7

42 U.S.C. 1382c(a) (3) (B) .---------------- 5 Section 404.929 .-------------------------- 7

42 USC. 1988(6) (1) ................-.-.- 7 Section 404.983 (b) --.--------------------- 7

I iain nc cdcarace 8, 32 Section 404.944 .- .- - - --------------------- 7

42 U.S.C. 1383b ( os oe 6 Sections 404.944-904.965_.................- 7

Vill IX

Regulations and rule—Continued : AN Page Regulations and rule—Continued: Page

a ee ee 7 a 7

ELIE CS OE 7 eT 7

a a ae ae 7 Section 416.1455(a) ......---~-- a a ~

SSS ee ae x Sections 416.1467-416.1483 ._.____.__________- 8

Sections 404.967-404.983 ._........__________ 8 cpp bt tg cae 8

Section 404.968 (a) (1)......----__________- 8 eters chery 8

ES a x a ~

a a g ee x

Sections 404.987-404.989 _....__-s—it 9 Sections 416.1487-416.1489 .___._._.__..________- 9

Sl iimoneceneassnanconceses 6 Pt. 422:

Section 404.1579 (1981) -......-..--------- 14 Sections 408.900 of cse__...—........-_.._.. 7

Section 404.1586 (1981) O680G20eeeeeeneenee 14 en x

ER 10 ES ee 7

Section 4041895 ---------ss 10 Fed. R. Civ. P.25(@) = "

By SY otin-tiaskabidkdbthonala ae aie tebe 9 Miscell

ve 130 Cong. Rec. $11454 (daily ed. Sept. 19, 1984 __ 15,43

Section 416.903 -- - ------------------------ 6 H.R. Conf. Rep. 96-944, 96th Cong., 2d Sess.

a 10 ERE TEE A el le Dc 9

Section 416.994 (1981) -...--.------------- 9, 10 H.R. Conf. . 98-1039, ng.,

Section 416.1331 (b) ----------------------- 9 (1984) Severe treet YN 42-43

Section 416.1336()b) ----------------------- 12, 40 H.R. Rep. 728, 76th Cong., Ist Sess. (1939)_...... 32

Section 416.1400(a) (5) .------------------- 8 H.R. Rep. 98-618, 98th Cong., 2d Sess. (1984) __7, 10, 41,

Section 416.1403 (a) (5) euaGeeareousnedbanda g 42, 43, 47

Section 416.1404 .------------------------- 6 S. Rep. 734, 76th Cong., Ist Sess. (1939) __.______ 32

Section 416.1404 (b) (3).------------------- 7 S. Rep. 97-648, 97th Cong., 2d Sess. (1982) ______ 11, 12

Section 416.1406 -------------------------- 6,7 S. Rep. 98-466, 98th Cong., 2d Sess. (1984) __7, 41, 47, 48

Section 416.1407 - ------------------------- 6 SSA 1986 Ann. Rep. to the Congress (1986) ______ 46

Sections 416.1407-416.1421 .-------------__- 6 SSA 1987 Ann. Rep. to the Congress (1987) .______ 5, 45

Section 416.1409 -_-.-----.---------------- 6 SSA Office of Hearings and Appeals Key Workload

Section 416.1409 (a)-...------------------- 6 Indicators (Aug. 1987)_........ 45

OSTIR SEE. BGNS 02 one 6 it ail tae alana Naa 14

ES eee ane 7

ER ee ee 7

CS 7

Sections 416.1429-416.1465 .___..........___- 7

TS eS ee 7

a a ea, 7

DGD .cdedenddtnenenaeneeadane 7

Iu the Supreme Court of the United States

OCTOBER TERM, 1987

No. 86-1781

RICHARD SCHWEIKER, ET AL., PETITIONERS

JAMES CHILICKY, ET AL.

ON WRIT OF CERTIORARI TO THE UNITED STATES

COURT OF APPEALS FOR THE NINTH CIRCUIT

BRIEF FOR THE PETITIONERS

OPINIONS BELOW

The opinion of the court of appeals (Pet. App. 1la-

14a) is reported at 796 F.2d 1131. The opinion of the

district court (Pet. App. 15a-18a) is unreported.

JURISDICTION

The judgment of the court of appeale (Pet. App.

19a-20a) was entered on August 12, 1986. A peti-

tion for rehearing with suggestion for rehearing en

bane was denied on December 8, 1986 (Pet. App.

2la-22a). On February 27, 1987, Justice O’Connor

extended the time for filing a petition for a writ of

certiorari to and including May 7, 1987, and the

petition was filed on May 6, 1987. The petition for

a writ of certiorari was granted on October 5, 1987.

(1)

2 3

The jurisdiction of this Court is invoked under 28 conformity with any regulation prescribed under

U.S.C. 1254(1). subsection (a) of this section, the court shall re-

view only the question of conformity with such

STATUTORY PROVISIONS INVOLVED caps and the we way Ay beg a

, : , court may, on motion o Secretary m

1. Section 205(g) of the Social Security Act, 42 for good aaa diearn before be Glen oy

U.S.C. 405(g), provides: remand the case to the Secretary for further ac-

Judicial review.

Any individual, after any final decision of the

Secretary made after a hearing to which he was

a party, irrespective of the amount in contro-

versy, may obtain a review of such decision by a

civil action commenced within sixty days after

the mailing to him of notice of such decision or

within such further time as the Secretary may

allow. Such action shall be brought in the dis-

trict court of the United States for the judicial

district in which the plaintiff resides, or has his

principal place of business, or, if he does not re-

side or have his principal place of business within

any such judicial district, in the United States

District Court for the District of Columbia. As

part of his answer the Secretary shall file a certi-

fied copy of the transcript of the record includ-

ing the evidence upon which the findings and de-

cision complained of are based. The court shall

have power to enter, upon the pleadings and tran-

script of the record, a judgment affirming, modi-

fying, or reversing the decision of the Secretary,

with or without remanding the cause for a re-

hearing. The findings of the Secretary as to any

fact, if supported by substantial evidence, shall

be conclusive, and where a claim has been denied

by the Secretary or a decision is rendered under

subsection (b) of this section which is adverse

to an individual who was a party to the hearing

before the Secretary, because of failure of the

claimant or such individual to submit proof in

tion by the Secretary, and it may at any time

order additional evidence to be taken before the

Secretary, but only upon a showing that there is

new evidence which is material and that there is

good cause for the failure to incorporate such

evidence into the record in a prior proceeding;

and the Secretary shall, after the case is re-

manded, and after hearing such additional evi-

dence if so ordered, modify or affirm his findings

of fact or his decision, or both, and shall file with

the court any such additional and modified find-

ings of fact and decision, and a transcript of the

additional record and testimony upon which his

action in modifying or affirming was based. Such

additional or modified findings of fact and deci-

sion shall be reviewable only to the extent pro-

vided for review of the original findings of fact

and decision. The judgment of the court shall be

final except that it shall be subject to review in

the same manner as a judgment in other civil ac-

tions. Any action instituted in accordance with

this subsection shall survive notwithstanding any

change in the person occupying the office of Sec-

retary or any vacancy in such office.

2. Section 205(h) of the Social Security Act, 42

U.S.C. (Supp. III) 405(h), provides:

Finality of Secretary's decision.

The findings and decision of the Secretary

after a hearing shall be binding upon all individ-

uals who were parties to such hearing. No find-

ings of fact or decision of the Secretary shall be

reviewed by any person, tribunal, or governmen-

tal st provided. No action

against the United States, the Secretary, or any

officer or employee thereof shall be brought un- .

der sections 1331 or 1346 of title 28 to recover

on any claim arising under this subchapter.

STATEMENT

This is a Bivens suit brought by three recipients

of Social Security disability benefits whose benefits

were terminated pursuant to disability reviews con-

ducted by the Social Security Administration. The

benefits of all three respondents were fully restored

during administrative review or on a subsequent ap-

plication for new benefits. Respondents nonetheless

seek personal damages from the former Secretary of

Health and Human Services and two other high-

level officials for alleged due process violations in the

handling of their claims.

A. The Statutory and Regulatory Framework

The Federal Government provides benefits to dis-

abled persons under two distinct programs adminis-

tered by the Social Security Administration (SSA).

Title II of the Social Security Act provides for the

payment of disability insurance benefits to persons

who have contributed to the program and who suffer

from a mental or physical disability, 42 U.S.C.

(& Supp. III) 423. Disability benefits are also pay-

able to indigent disabled persons under the Supple-

mental Security Income (SSI) program established

by Title XVI of the Act, 42 U.S.C. (& Supp. III)

1382(a). See generally Bowen v. City of New York,

No, 84-1923 (June 2, 1986), slip op. 1-2. Under both

programs, a person is considered disabled if, because

of a physical or mental impairment, he is unable to

do his previous work or to “engage in any * * *

kind of substantial gainful work which exists in the

national economy.” 42 U.S.C. (& Supp. III) 423

(d) (2) (A), 1382e(a) (3) (B).

The disability programs administered under Titles

II and XVI “are of a size and extent difficult to com-

prehend.” Richardson v. Perales, 402 U.S. 389, 399

(1971). “Approximately two million disability claims

were filed under these two titles in fiscal year 1983.”

Heckler v. Day, 467 U.S. 104, 106 (1984). In fiscal

year 1987, an estimated 1.3 million new claimants

sought benefits under Title II, and 1.49 million

sought disability benefits under Title XVI. It was

further estimated that approximately 7 million per-

sons would be receiving disability benefits under the

two titles as of September 30, 1987. See SSA 1987

Ann. Rep. to the Congress 29, 31 (1987). The Secre-

tary of Health and Human Services has promulgated

detailed regulations governing the procedures for the

adjudication of claims for benefits. In addition, Con-

gress has mandated continuing review of those per-

sons receiving benefits who are not permanently dis-

abled to ensure their continued eligibility.

1. Procedural Provisions

“To facilitate the orderly and sympathetic ad-

ministration of the disability program[s] * * * the

Secretary and Congress have established an unusu-

ally protective * * * process for the review and ad-

judication of disputed claims.” Heckler v. Day, 467

U.S. at 106. If it is determined at any stage of this

process that the individual is eligible for benefits

(and if he has not been receiving benefits), he is en-

titled to retroactive payments for the entire period

of his eligibility, up to 12 months prior to his initial

application. See Mathews \. Eldridge, 424 U.S. 319,

339 (1976).

a. Congress has directed that the determination

whether an individual is under a disability shall be

made in the first instance by a state agency, pur-

suant to regulations, guidelines, and performance

standards established by the Secretary through SSA.

42 U.S.C. (& Supp. ITI) 421(a), 1383b(a) ; 20 C.P.R.

404.1503, 416.903. See Mathews v. Eldridge, 424

U.S. at 335; Heckler v. Day, 467 U.S. at 106. The

state agency renders an initial determination on the

basis of its consideration of an application submitted

by a person seeking benefits for the first time. See

Mathews v. Eldridge, 424 U.S. at 337-338.

b. If the state agency initially determines that a

new applicant is not disabled, the individual may re-

quest a de novo reconsideration by the state agency.

20 C.F.R. 404.904, 404.907-404.921, 416.1404,

416.1407-416.1421. Governing regulations provide—

and the claimant is personally notified—that the ad-

verse initial determination becomes “binding” if he

does not request reconsideration within 60 days of

his receipt of the adverse initial determination.

20 C.F.R. 404.904, 404.905, 404.909(a) (1), 416.1404,

416.1405, 416.1409(a).'

ce. Under 42 U.S.C. (& Supp. ITI) 421(d), if an

individual is dissatisfied with the decision by the

state agency after its initial determination and re-

consideration of the claim, he “shall be entitled to

' The Secretary has not provided for a separate state-agency

reconsideration stage in disability cessation cases under Title

XVL. An SSI recipient therefore may proceed directly to an

ALJ hearing if he requests one within 60 days of the initial

determination. 20 C.F.R. 416.1407, 416.1415.

a hearing thereon by the Secretary to the same ex-

tent as is provided in [42 U.S.C. (& Supp. III)

405(b)].” See also 42 U.S.C. 1383(c) (1); 20 C.F.R.

404.944-404.965, 416.1429-416.1465. The Act re-

quires—and the claimant is personally notified—that

the state agency’s decision becomes binding upon the

claimant if he does not request such a hearing within

60 days of his receipt of the state agency’s deter-

mination. 42 U.S.C. (& Supp. III) 405(b)(1); 42

U.S.C. 1383(c)(1); 20 C.F.R. 404.920, 404.921,

404.933(b), 416.1404(b)(3), 416.1405, 416.1420,

416.1421, 416.1433(b).

The evidentiary hearing is conducted by an ad-

ministrative law judge (ALJ) within SSA’s separate

Office of Hearings and Appeals (20 C.F.R. 404.929,

416.1429, 422.201 et seg.). The ALJ is directed to

“look[] fully into the issues” (20 C.F.R. 404.944,

416.1444). See Heckler v. Campbell, 461 U.S. 458,

469 n.12 (1983). Either the claimant or the ALJ

may develop new evidence or raise new issues that

were not presented to the state agency, and the claim-

ant or his representative has a right to make an oral

or written statement regarding the facts and applica-

ble law. 20 C.F.R. 404.929, 404.944, 404.946, 404.949,

404.950, 416.1429, 416.1444, 416.1446, 416.1449,

416.1450. In rendering his decision, the ALJ must

follow SSA’s published regulations and formal Social

Security Rulings (20 C.F.R. 422.408), but he is not

bound by the Programs Operations Manual System

and other instructional material that SSA furnishes

to the state agencies to guide them in their prelimi-

nary evaluation of disability claims. See Heckler v.

Ringer, 466 U.S. 602, 607-608 (1984); S. Rep.

98-466, 98th Cong., 2d Sess. 18-19 (1984); H.R. Rep.

98-618, 98th Cong., 2d Sess. 20-22 (1984).

d. If the decision by the ALJ after a hearing

under either Title II or Title XVI is adverse to the

claimant, he then may seek review by the Appeals

Council in SSA. 20 C.F.R. 404.967-404.983, 416.1467-

416.1483. Governing regulations provide—and the

claimant is once again personally notified—that the

adverse ALJ’s decision becomes binding if the claim-

ant does not seek Appeals Council review within 60

days or such further period as the Secretary permits.

20 C.F.R. 404.955(a), 404.968(a)(1), 416.1455(a),

416.1468.

e. The Appeals Council’s denial of review or deci-

sion on the merits constitutes the Secretary’s “final

decision” on the individual’s claim for benefits. At

that point, the Act and implementing regulations

provide for the claimant to seek judicial review in

federal district court, pursuant to 42 U.S.C. 405(g).

See 42 U.S.C. (& Supp. III) 421(d), 1383(c) (3);

20 C.F.R. 404.900(a) (5), 404.981, 416.1400(a) (5),

416.1481, 422.210. Section 405(g) requires that the

claimant seek such review “within sixty days after

the mailing to him of notice of [the final] decision

or within such further time as the Secretary may al-

low,” and the notice of the Appeals Council’s decision

informs the claimant of this requirement. See 20

C.F.R. 404.982, 416.1482 (Secretary may extend

time for filing for good cause shown). If judicial

review is not sought within the time allowed, the

Appeals Council’s decision (or the ALJ’s decision,

if the Appeals Council denied review) is expressly

made binding upon the claimant. 20 C.F.R. 404.981,

404.982, 416.1481, 416.1482.

f. Although an adverse decision at any step of

the administrative process becomes binding upon the

claimant if he does not seek further review within

the time allowed, the Secretary has provided by regu-

lation that such a decision may be reopened within

12 months of the initial determination for any rea-

son, within either two or four years for good cause,

and at any time if the decision was obtained by

fraud or similar fault. 20 C.F.R. 404.987-404.989,

416.1487-416.1489. However, the Secretary’s denial

of a request to reopen is not subject to administra-

tive or judicial review. 20 C.F.R. 404.903(/),

416.1403(a)(5). See Califano v. Sanders, 430 U.S.

99, 108 (1977).

2. Continuing Disability Review

An individual who is found to be disabled under

either Title II or Title XVI is entitled to benefits

only for as long as he continues to be disabled under

the statutory definition of disability. 42 U.S.C. (&

Supp. III) 423(a)(1), 425, 138la; 20 C.F.R.

404.1594, 404.1597, 416.994, 416.1331(b). Prior to

legislation enacted in 1980 (effective January,

1982), however, “[a]dministrative procedures * * *

provide[d] that a disability beneficiary’s continued

eligibility for benefits be reexamined only under a

limited number of circumstances.” H.". Conf. Rep.

96-944, 96th Cong., 2d Sess. 60 (1980). The 1980

legislation sought to ensure that only those qualified

received payments by amending Title II of the Social

Security Act to require that, “except * * * where

a finding has been made that [a claimant’s] disabil-

ity is permanent,” “the case shall be reviewed * * *

for purposes of continuing eligibility, at least once

every 3 years * * * .” Pub. L. No. 96-265, § 311

(a), 94 Stat. 460, codified at 42 U.S.C. (& Supp. III)

421(i). Notwithstanding the January 1, 1982, statu-

tory effective date of this continuing disability re-

view (CDR) program (42 U.S.C. 421 note), the

Secretary began the CDR process in March, 1981

(Pet. App. 2a; H.R. Rep. 98-618, supra, at 10).°

a. When an individual’s case is reviewed he bears

the burden of showing, “by means of ‘medically ac-

ceptable clinical and laboratory diagnostic tech-

niques,’”’ that he continues to have a physical or

mental impairment of sufficient severity to satisfy

the statutory standard of disability. Mathews v.

Eldridge, 424 U.S. 319, 336 (1976) (quoting 42

U.S.C. 423(d)(3)). The individual is first notified

by the state that his case has been selected for review

and is requested to furnish information about his

current medical condition and the identity of his

treating physician. 20 C.F.R. 404.1593, 416.993. If

the state agency then makes a tentative determina-

tion that his disability has ceased, the individual is

given an advance written notice and explanation and

is informed that he has 10 days within which to sub-

mit any additional information. 20 C.F.R. 404.1594-

404.1595, 416.994. After this 10-day period and the

receipt of any further evidence, the state agency

makes its initial determination. See Mathews v.

Eldridge, 424 U.S. at 337-338 (describing continu-

ing-eligibility investigation process as it existed be-

fore the 1980 amendment). Once the state has made

an initial determination that a recipient is no longer

disabled, the process of administrative and judicial

review follows, with certain exceptions, the same

path as that for new claimants.

2 Although the CDR program only applied directly to Title

II claimants, many persons were receiving benefits under both

the Title II insurance program and the Title XVI SSI program

and, thus, were subject to reviews that examined their eligi-

bility under both programs.

b. The CDR process generated considerable con-

troversy because of the high number of state deter-

minations that individuals had ceased to be disabled

and the high percentage of subsequent reversals of

those determinations. “In the early stages of the

continuing disability investigation (CDI) review

process,” the Senate Finance Committee in 1982

found that, “while reviews have been focused on

cases most likely to be found ineligible, States have

been terminating benefits in approximately 45 per-

cent of the cases reviewed. Of those cases which ap-

peal, approximately 65 percent have benefits rein-

stated by an administrative law judge.” S. Rep.

97-648, 97th Cong., 2d Sess. 6 (1982).°

From the commencement of the CDR process in

1981, the Secretary had assured compliance with

Goldberg v. Kelly, 397 U.S. 254 (1970), in the need-

based Title XVI program by allowing an SSI recipi-

ent to elect to continue to receive benefits from the

date of the state agency’s determination that he no

longer is disabled until the ALJ has rendered his

’ The Senate Report provided some explanation for this

high reversal rate: “This wide variation between the deci-

sions made by State agencies and ALJs, a long recognized

problem, stems from a number of factors. For example, the

beneficiary can introduce new medical evidence at the ALJ

hearing; the ALJ hearing is the first face-to-face contact be-

tween the reviewed beneficiary and a decision-maker; and

the standards of disability used by State agencies and ALJs

differ in some important respects.” S. Rep. 97-648, supra, at

6. See also id. at 21 (Additional Views of Sen. Long): “While

this is a very high reversal rate, it is not strikingly different

from the administrative law judge reversal rate in prior

years, nor from the administrative law judge reversal rate of

initial claims. * * * Most reversals are due to the application

of easier eligibility standards [by the ALJs].”

decision following a hearing. 20 C.F.R. 416.1336(b).

But in view of the Court’s decision in Mathews v.

Eldridge, 424 U.S. at 349, that the Due Process

Clause does not require the Secretary to continue

non-need-based Title II payments until the individ-

ual has had an opportunity for an ALJ hearing, no

similar protection was provided to Title II bene-

ficiaries. Rather, at the time the CDR process was

begun, Title II benefits were terminated effective

two months after the month in which the recipient

ceased to be disabled, regardless of the recipient’s

pursuit of administrative or judicial review. 42

U.S.C. (& Supp. III) 423(a). See Mathews v. Eld-

ridge, 424 U.S. at 338; H.R. Conf. Rep. 98-1039,

98th Cong., 2d Sess. 33 (1984). Thus;-during the

pendency of their administrative appeals, Title II

beneficiaries were without benefits.*

Concluding that “some emergency relief” was war-

ranted (S. Rep. 97-648, supra, at 6), Congress en-

acted legislation, the Act of Jan. 12, 1983, Pub. L.

No. 97-455, 96 Stat. 2497, making temporary provi-

sion for Title II claimants to continue to receive bene-

fits following the state agency’s termination decision,

pending receipt of the ALJ’s decision, and subject to

recoupment if the ALJ affirms the state agency’s

determination. Pub. L. No. 97-455, §2, 96 Stat.

* As a general rule, however, an individual’s disability was

not found to have “ceased” until the month in which the

agency made the “no disability” determination. Thus, termi-

nated recipients generally enjoyed two months of continued

benefits, whether or not they pursued their administrative

remedies. See S. Rep. 97-648, supra, at 6 (“As an administra-

tive practice, individuals are now generally found to be ‘not

disabled’ no earlier than [the] month in which the agency

makes the termination decision.” ).

2498, codified at 42 U.S.C. (& Supp. III) 423(g).°

Congress also provided that following the initial de-

termination by the state that a recipient is no longer

disabled, the state must provide a face-to-face hearing

on any motion for reconsideration. § 4, 96 Stat. 2499-

2500, codified at 42 U.S.C. 405(b) (2). See 20 C.F.R.

404.917.

At the same time, Congress eliminated the require-

ment that beneficiaries with nonpermanent disabili-

ties be reviewed every three years, and instead pro-

vided that the Secretary should, after consultation

with the state agency and based on a number of fac-

tors, determine the number of cases to be reviewed

in each State. Pub. L. No. 97-455, § 3, 9° Stat. 2499,

codified at 42 U.S.C. 421(i)(2). Finally, Congress

required that the Secretary file semiannual reports

to the appropriate congressional committees, includ-

ing statistics on the actual operation and results of

the continuing disability review process. § 6, 96 Stat.

2500-2501, codified at 42 U.S.C. 421(i) (3).

c. Despite these amendments, the CDR process con-

tinued to generate widespread controversy and litiga-

tion, primarily centered on the so-called “medical

improvement” issue. That issue concerns the eviden-

tiary standards that the Secretary must utilize in

determining whether a person receiving disability

* The temporary authorization (as briefly extended by the

Act of Oct. 11, 1983, Pub. L. No. 98-118, § 2, 97 Stat. 803)

applied to any case in which the initial determination that

the disability had ceased was made on or after (or was pend-

ing on administrative review on) the effective date of the

Act (January 12, 1983), but before December 7, 1983. The

Secretary was authorized to continue to pay benefits in such

cases through June 1984 or until the ALJ rendered his deci-

sion, whichever occurred first.

benefits continues to be disabled. When the CDR proc-

ess began in 1981, the Social Security Act did not im-

pose any special standards for continuing disability

reviews, and the claimant bore the burden of proving

by medical evidence that he met the statutory stand-

ard of eligibility when his status was reviewed. See

Mathews v. Eldridge, 424 U.S. 319, 336 (1976). The

Secretary determined that the continuing eligibility

inquiry should focus on whether the claimant’s cur-

rent condition satisfied applicable standards, rather

than on whether his condition had changed. It was

not the Secretary’s position, however, that the prior

finding of disability was irrelevant, because it might

well shed light on the claimant’s current condition.

SSR 81-6 (1981); 20 C.F.R. 404.1579, 404.1586,

404.1594, 416.994 (1981).

Many claimants challenged the Secretary's ap-

proach, often in the form of massive class actions

that substantially disrupted the orderly administra-

tion of the Social Security disability program. See,

e.g., Lopez v. Heckler, 725 F.2d 1489 (9th Cir. 1984),

vacated and remanded, 469 U.S. 1082 (1984); Kueh-

ner v. Schweiker, 717 F.2d 813 (3d Cir. 1983), va-

cated and remanded, 469 U.S. 977 (1984). They

typically argued that if an individual was once found

to be disabled he was entitled to a presumption that

he continued to be disabled when his eligibility was

subject to review, thereby effectively shifting to the

Secretary the burden of producing evidence that the

individual no longer was disabled. A number of

courts of appeals agreed and held that the claimant

should be afforded a presumption of continuing dis-

ability."

* See, e.g., Rush v. Secretary of HHS, 738 F.2d 909, 915-916

(8th Cir. 1984) ; De Leon v. Secretary of HHS, 734 F.2d 930,

Citing the “pressing need to end the acrimonious

litigation that has engulfed this program” * (130 Cong.

Rec. 811454 (daily ed. Sept. 19, 1984) (remarks

of Sen. Dole, Chairman of the Senate Finance Com-

mittee)), Congress passed the Social Security Dis-

936-987 (2d Cir. 1984); Haynes v. Secretary of HHS, 734

F.2d 284, 288 (6th Cir. 1984) ; Dotson v. Schweiker, 719 F.2d

80, 82 (4th Cir. 1983); Patti v. Schweiker, 669 F.2d 582,

586-587 (9th Cir. 1982). But see Gist v. Secretary of HHS,

736 F.2d 352, 355-357 (6th Cir. 1984) ; Kuzmin v. Schweiker,

whose case is reviewed may be determined not to be entitled

individual’s impairment and that he is now able to engage in

substantial gainful activity; (2) new medical evidence and a

ficiary of advances in medical or vocational therapy or tech-

solve the existing controversy over the medical im-

provement issue in the courts” (id. at 27) by prohib-

iting the certification of new classes on the issue and

by mandating a remand of pending actions to the

Secretary for reconsideration under the new stand-

ards. Pub. L. No. 98-460, § 2(d), 98 Stat. 1797-1798.

See Heckler v. Lopez, 469 U.S. 1082 (1984); Kueh-

ner v. Schweiker, 469 U.S. 977 (1984).

Congress made a number of other adjustments to

the CDR program in the same Act. Among other

actions,’ Congress extended the interim benefits au-

thorization under Title II until January 1, 1988.

Pub. L. No. 98-460, § 7(a) (2), 98 Stat. 1803, codified

at 42 U.S.C. (Supp. III) 423(g). It also required the

nology and is now able to engage in substantial gainful ac-

tivity; (3) substantial evidence based on new or improved

diagnostic techniques demonstrating that the individual's im-

pairment is not as disabling as it previously was considered to

be and that he is now able to engage in substantial gainful

activity: or (4) substantial evidence that the prior determina-

tion of disability was in error. Congress expressly provided,

however, that there is no presumption of continuing disability

and that the determination whether the person is currently

disabled is to be made on a neutral basis after considering

all evidence available in the file. 42 U.S.C. (Supp. III) 423(f),

1382c.

* Congress also required the Secretary to promulgate within

180 days final regulations establishing standards for deter-

mining the frequency of CDR reviews, Pub. L. No. 98-460

§ 15, 98 Stat. 1808, 12 U.S.C. (Supp. IIT) 421 note, to publish

revised mental impairment criteria and to delay resumption

of periodic review of most mentally impaired individuals unti!

the new standards were in place, § 5, 98 Stat. 1801, 42 U.S.C.

(Supp. TIl) 421 note, and to publish uniform standards for

disability determinations that would be binding at all levels

of adjudication, § 10, 98 Stat. 1805, codified at 42 U.S.C.

(Supp. ITT) 421(k) (1).

Secretary to establish demonstration projects in at

least five states, pursuant to which the Secretary

gives Title II and Title XVI recipients subject to a

continuing disability review the opportunity for a

personal appearance prior to the initial determination

of ineligibility, rather than afterwards. § 6(d), 98

Stat. 1802, codified at 42 U.S.C. (Supp. III) 421 note.

B. The Proceedings in This Case

1. Respondents are three individuals ° who were

recipients of disability benefits under Title Il. They

filed suit against Richard Schweiker, John Svahn, and

William R. Sims in their official and individual capac-

ities." Richard Schweiker is the former Secretary of

’° Respondents withdrew their earlier motion for class cer-

tification following passage of the 1984 Disability Reform Act

claims against them in their individual capacities (Pet. App.

2a-3a n.1, 16a). By the time the case reached the court of

appeals, only claims against officials in their individual ca-

pacities remained (id. at 4a), and consequently Heckler and

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claims, but apparently determined that they

barred by qualified immunity as well (see id. at

18a).

3. Respondents appealed to the U

Court of Appeals for the Ninth Circuit, af-

firmed in part, reversed in part, and remanded the

‘

(Pet. App. la-l4a). On appeal, the

raised by respondents pertained to their Bivens”

claims for money damages against petitioners in

their individual capacities (see Resp. C.A. Br. ii).

™ See Bivens v. Siz Unknown Fed. Narcotics Agents, 403

U.S. 388 (1971).

tioners contended that there was no subject

entertain respondents’ claims,

forth in 42 U.S.C. 405(g)

redress for actions “aris-

the relevant provisions of the Social Se-

42 U.S.C. (& Supp. III) 405(h).

out that the existence of the Act’s

procedures for resolving disability claims

against judicial implication of a

and that there could be no colorable

due

process when respondents were

afforded the protections of Section 405(g). Petition-

event, respondents’ claims were barred by qualified

immunity.

The court of appeals found that the district court

had subject matter jurisdiction (Pet. App. 4a-6a).

It reasoned that the action was not for restoration of

disability benefits, but rather for damages stemming

from alleged constitutional violations committed in

terminating those benefits, so that it did not “arise

under” the Social Security Act and was not barred

by Section 405(h) (Pet. App. 6a). The court then

ruled that the officials waived their personal jurisdic-

tion defense by not raising it at the appropriate stage

in the district court proceedings (id. at 7a-9a). Fi-

nally, the court of appeals affirmed the district court’s

dismissal on qualified immunity grounds of respond-

ents’ acceleration of review and nonacquiescence

claims (id. at lla-13a), but reversed the district

court’s dismissal on qualified immunity grounds of

the balance of respondents’ claims” and remanded

** As described by the court of appeals (Pet. App. 13a-14a),

the remaining allegations are:

for further proceedings (id. at 13a-l4a). The court

of appeals concluded that under the current record

it could not determine that respondents could prove

no state of facts establishing an actionable due proc-

ess violation for the latter claims (id. at 14a).

The court of appeals denied petitioners’ petition

for rehearing with a suggestion of rehearing en

bane, which was limited to the question of subject

matter jurisdiction (Pet. App. 2la-22a).

SUMMARY OF ARGUMENT

The issue presented in this case is whether a dis-

ability claimant may bring a Bivens action to chal-

lenge alleged violations of his constitutional rights

occurring in the course of proceedings leading to the

termination of his disability benefits. In its decisions,

this Court has recognized that three distinct but not

mutually exclusive lines of reasoning may render

such an implied cause of action inappropriate. First,

Congress may expressly preclude such a remedy, by

declaring that other remedies of its own creation are

exclusive. Second, Congress may implicitly preclude

a constitutional remedy by creating its own remedy,

equally effective in the eyes of Congress, or by other-

1. Knowing use of unpublished criteria and rules and

standards contrary to the Social Security Act.

2. Intentional disregard of dispositive favorable evidence.

3. Purposeful selection of biased physicians and staff to

review claims.

4. Imposition of quotas.

5. Failure to review impartially adverse decisions.

6. Arbitrary reversal of favorable decisions.

7. Denial of benefits based on the type of disabling im-

pairment.

8. Unreasonable delays in receiving hearings after termi-

nation of benefits.

wise occupying the field with a comprehensive legis-

lative scheme. Third, even apart from any express

or implied decision by Congress, there may exist spe-

cial factors counselling hesitation in the recognition of

a constitutional remedy, because of the identifiable

consequences such a remedy would have. All three of

these lines of reasoning indicate that a Bivens remedy

should not be recognized in this case.

1. Section 405(h) of Title 42, United States Code,

should be taken as an express declaration by Con-

gress that a Bivens remedy is precluded in this con-

text. The second sentence of Section 405(h) states

that the Secretary’s findings of fact and decisions

shall not be reviewed “except as herein provided,”

and Section 405(g) provides the exclusive avenue of

review under the Act with specified forms of relief.

Because a Bivens action seeking damages from an

individual for alleged constitutional violations is not

provided under Section 405(g), it is foreclosed by

the explicit terms of Section 405(h).

Furthermore, the third sentence of Section 405(h)

provides, inter alia, that no action “arising under”

the Title II disability provisions shall be brought

against an employee of the United States pursuant to

28 U.S.C. 1331, which is the essential jurisdictional

predicate for a Bivens action. The present action,

seeking relief for alleged constitutional wrongs oc-

curring in the course of the administrative process

leading to the temporary termination of respondents’

benefits, plainly “arises under” the Title II provi-

sions. This conclusion is not altered by either the

constitutional nature of respondents’ claims or by the

fact that the relief they seek is not provided by the

statute. Otherwise the bar to Section 1331 jurisdic-

tion would exist only where it is redundant because

a Section 405(g) remedy was already available. Be-

cause respondents’ claims “arise under” the statute,

and because Section 1331 is the essential jurisdic-

tional predicate for a Bivens action, the third sen-

tence of Section 405(h) expressly bars that avenue

of relief.

2. By the creation and refinement of an elaborate,

multi-step system of remedies for persons claiming

entitlement to disability benefits, Congress has oc-

cupied the field and implicitly foreclosed the recogni-

tion of additional judicial remedies. Like the Civil

Service Reform Act at issue in Bush v. Lucas, 462

U.S. 367 (1983), the Social Security Act and its

statutory review procedures are the product of a

carefully considered, step-by-step fine-tuning by Con-

gress. In fact, Congress twice modified the Continu-

ing Disability Review (CDR) process in which each

of respondents was involved, first in 1983 and again

in 1984, after consideration of the very concerns

raised by respondents here.

The four-step review process provided by statute

is designed to assure that no beneficiary loses benefits

as a result of arbitrary decision-making. It has been

liberally construed by this Court in various ways,

and while the statute does not allow the full measure

of damages that would be available under Bivens, it

is in several respects, including speed and the absence

of an immunity defense, more favorable to claimants

than an implied constitutional remedy would be. As

in Bush v. Lucas, Congress’s statutory remedial

scheme under the Social Security Act is both compre-

hensive and provides meaningful relief for the alleged

constitutional wrongs related to the termination of

benefits. Accordingly, it should be viewed as barring

implication of an additional constitutional remedy.

8. Finally, the sheer size of Social Security Act -

programs, and particularly the Title II disability pro-

gram at issue here, is a special factor counselling

hesitation in the implication of such a judicial

remedy. The millions of claims processed by the

Social Security Administration mean that a remedy

recognized here would bring major additional burdens

to the courts and to the government officials who

would be named as defendants and would participate

in the defense of these cases. Given the already enor-

mous commitment of resources to these programs and

the serious governmental concern to control the

future expansion of costs, the implication of such a

further remedy could have seriously disruptive conse-

quences.

ARGUMENT

A DISABILITY CLAIMANT CHALLENGING THE

TERMINATION OF HIS BENEFITS MUST FOLLOW

THE ADMINISTRATIVE AND JUDICIAL REVIEW

PROCEDURES PRESCRIBED BY CONGRESS AND

MAY NOT ALSO SEEK DAMAGES UNDER AN

IMPLIED CONSTITUTIONAL CAUSE OF ACTION

AGAINST OFFICIALS RESPONSIBLE FOR THE TER-

MINATION

A. Introduction

1. Although the Constitution establishes rights, it

does not in general specify the remedy for violations

of those rights. Congress and the courts, therefore,

must prescribe remedies for constitutional violations.

It is, however, axiomatic that unless the Constitution

itself requires a particular form of relief, a federal

court cannot provide a remedy unless it is authorized

to do so explicitly or implicitly by statute. See, e.9.,

Sheldon yv. Still, 49 U.S. (8 How.) 441, 448-449

(1850); United States v. Hudson & Goodwin, 11 US.

(7 Cranch) 32, 33 (1812); Ex parte Bollman, 8 U.S.

(4 Cranch) 75, 94 (1807) (Marshall, C.J.) (“the

power to award the writ [of habeas corpus] by any

of the courts of the United States, must be given by

written law’’).

In Bivens v. Six Unknown Fed. Narcotics Agents,

403 U.S. 388 (1971), this Court allowed a plaintiff

to seek damages from federal officials for an alleged

violation of his Fourth Amendment rights. The Court

specifically noted that it was not holding that the

Constitution itself required the creation of the remedy

(id. at 396), and Congress had not explicitly author-

ized such relief. But the Court noted that Congress

had granted federal district courts general jurisdic-

tion (28 U.S.C. 1331) to entertain claims arising

under the Constitution, see 403 U.S. at 396, quoting

Bell v. Hood, 327 U.S. 678, 684 (1946); 403 U.S. at

405 (Harlan, J., concurring in the judgment), and

that Congress itself had not prescribed a more spe-

cific remedy for Fourth Amendment violations, see

403 U.S. at 390, 397. Since Congress had created

courts with jurisdiction over the claims, but had not

established a specific remedy, the Court in Bivens

concluded that federal courts were free to implement

the remedies, including damages, that courts “[h]is-

torically” and “normally” have provided. See 403

U.S. at 395, 397; see also id. at 405, 408 n.8 (Harlan,

J., concurring in the judgment); Montana-Dakota

Utilities Co. v. Northwestern Pub. Serv. Co., 341 U.S.

246, 261 (1951) (Frankfurter, J., dissenting)

(“Courts, unlike administrative agencies, are organs

with historic antecedents which bring with them well-

defined powers. They do not require explicit statu-

tory authorization for familiar remedies * * *.’’).

In two subsequent cases, the Court followed the

Bivens reasoning in recognizing an implied damage

remedy under the Constitution. Davis v. Passman,

442 U.S. 228 (1979), recognized a plaintiff’s claim

that she had been discharged from her position as a

congressional employee because of her sex, in

tion of the Fifth Amendment. 442 U.S. at 241-242,

245. In Davis, unlike Bivens, there

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