Opposition Brief — Barnhart v. Walton

RECORD NO.00-1937 (2) i Qu o 2001

3S HE CLERK Bric

Suyreme Cont of Che nited e

LARRY G. MASSANARI, ACTING COMMISSIONER

OF SOCIAL SECURITY,

Petitioner,

V.

CLEVELAND B. WALTON,

Respondent.

ON PETITION FOR WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

BRIEF IN OPPOSITION

TO PETITION FOR WRIT OF CERTIORARI

Comet Vi inia Legal Aid Society, Inc

irginia , Inc.

Post Office Box 12206

Richmond, VA 23241

(804) 648-1012

Counsel of Record

LANTAGNE LEGAL PRINTING 801 East Main Street Suite 100 Richmond, Virginia 23219 (804) 644-0477

A Division of Lantagne Duplicating Services

RESTATEMENT OF QUESTIONS PRESENTED

1. Whether a claimant is entitled to disability benefits if he has a severe

physical or mental impairment which has lasted or is expected to last at least 12

months, but he engages in substantial gainful activity within 12 months of his onset

date.

2. Whether a claimant under Title II is entitled to a trial work period if

he has a severe impairment which has lasted or is expected to last more than 12

months, even though he returns to substantial gainful activity after the five month

waiting period but within 12 months of his onset date.

TABLE OF CONTENTS

Page

RESTATEMENT OF QUESTIONS PRESENTED ..........-00+-0005: i

TABLE OF AUTHORITIES ...........cccccceeceeeereeeeeseevees iii

STATEMENT OF THE CASE ..........ceecceeceecceeereeeeenees |

REASONS FOR DENYING THE PETITION ......... 6. sees eee eeees 2

I. The Fourth Circuit Properly Concluded that, According to the Plain

Language of the Statute and Relevant Regulations, it is the Impairment,

Not the Inability to Engage in SGA, Which Must Last 12 Months. ........ 4

Il. In Accordance With Four Other Courts of Appeals and

Numerous District Courts, the Fourth Circuit Properly Found That

Walton Was Entitled to a Trial Work Period. ........-..-eeeeeeeeeeees 15

CII go iki ik bcc dopdac vabacatccdnvagetcvccessencctenessy 32

TABLE OF AUTHORITIES

CASES

Page

Alexander v. Richardson, 451 F.2d 1185 (10" Cir. 1971), cert. denied,

rf Et rer ree Si 7

Bowen v. Yuckert, 482 U.S. 137 (1987) .........cccecececeeeeeeeeees 32

Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc.,

OODLE FITC OOO 5. 00 svcvcgss0nesctss oknvess epee 29

Cieutat v. Bowen, 824 F.2d 348 (5™ Cir. 1987). .......ccceecceeceueees 29

Darring v. Callahan, 1997 U.S. Dist. LEXIS 15187, 15161

re Se 21

Deihl v. Secretary of Health & Human Services, 835 F.Supp.

S902 GOING, BGUUD oc cincccccceecvaccneseneasauaeeeeeeee 21

Fabel v. Shalala, 891 F.Supp. 202 (D.N.J. 1995) ...........eeeeees 20, 31

Goldstein v. Harris, 517 F.Supp. 1314 (S.D.N.Y. 1981) ............0:. 21

Hunter v. Department of Health & Human Services, 851 F.Supp.

73 GRBILY. BOD 6 voceccsccncsédns cshuietueaeen 10, 16, 20, 29, 31

Jenkins v. Heckler, 783 F.Supp. 998 (D.S.C. 1992). .........2.e0005 10, 22

Kendrick v. Califano, 460 F.Supp. 561 (E.D.Va. 1978)...........00008: 25

McDonald v. Bowen, 818 F.2d 559 (7th Cir. 1986) . .3, 8, 10, 18, 20, 22, 27, 31

Mulderig v. Sullivan, 1993 WL 22152 (S.D.N.Y. 1993) .............055 20

Nappa v. Secretary of U.S. DHHS, 731 F.Supp. 579 (E.D.N.Y. 1990)..... 27

Newton v. Chater, 92 F.3d 688 (8th Cir. 1996) ........... 3, 8, 19, 20, 22, 30

© ©@

Page

i issi 221 F 3d 828

PP attced bendascdudededaidls sectesene 3, 8, 19, 27, 28, 30

Sierakowski v. Weinberger, 504 F.2d 831 (6th Cir. 1974)......... 24, 25, 27

Singletary v. Bowen, 798 F.2d 818 (5™ Cir. 1986) ...........0.0000- 8,9

Stone v. Heckler, 752 F.2d 1099 (5™ Cir. 1985) ........ cece ccc ceeeee 7

EN ea NORRIE vne — . Anca 21

Titus v. Sullivan, 4 F.3d 590 (8 Cir. 1993)... 2.2... ccc ccceccececeee 7

Walker v, Secretary of Health & Human Services, 943 F.2d 1257

SE IE ok ee vhbdincde'sstastccachie licsccess 3, 8, 18, 20, 22, 31

White y. Finch, 311 F.Supp. 307 (DD. Mass. 1970). ............000c000. 10

Wilson y. Shalala, 841 F.Supp. 1491 (B.D. Wash. 1994) ............... 21

STATUTES

No oi ods Caarcn Chet tetabes anda niaded aces 15

I ons s.ccnwiarcdbedidiks talbii coess cddeksce 15, 28

42 U.S.C. § 423(d)(1(A).......... EE A ea SAE — lk 4, 17, 28

REGULATIONS

SIE £5, 44 Ueda dulalanehd cUEb ewes dee ccnesacaee’ 15

RU ao i ey ee a ee aa 16

Is Cine) die? ta bal Daucwstsncéas thao, 16

Page

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SOR OIA 0 6s cccccccdccscccccesnscecesscessavenbbenkes 6

BO GOR TIED Soc ccccvccccccccecccsoccssocevetsoegedeces 6

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OR FP ORIEEE 6 occ cccncccondeksabeuwésdseccesecusunee 14, 15

TOGA. 0 606s i tbddesdscctsncckchanieeaeee 15

BOE GREED Secccccccccccdeceeeséecconeséasvennenebeunne 12

DOGMA GRNSS cece ccccccuvececoceusncedsenecubemeebenseu 12

SOCIAL SECURITY RULINGS

Pa ov cctvcccceccncdedndénesce sn ensentaaeembal 4, 9, 19, 30

Notice of Proposed Rule Making (NPRM), 60 Fed. Reg. 12166

QRREE BEING, GEER oo a cov ckscncessvbccuscensetitnususne 4, 30

SP Hs BR Gee 0 ccc cuceccevedsniccetcésceansdscaeteneuenal 3,5

LEGISLATIVE HISTORY

Report of the Senate Committee on Finance, S.Rep. No. 1987, 83d Cong.,

SEGUE, SE ococccccve cebdccdvcesondesteddsnbe caueeieeaned 7

Report of the House Committee on Ways and Means, H. Rep. No. 231,

SES Cong, TTB. . 2.0. 20000 sdedces adden baddehabeteaennenee 16

STATEMENT OF THE CASE

Cleveland Walton, a college graduate and teacher, was denied disability

benefits, despite his continuing Listing-level psychiatric impairment, for the sole

reason that he returned to work (as a grocery store clerk) despite his continuing

impairment, within 12 months of his October 1994 onset date. Walton’s return to

work occurred after his application for benefits and after the five month waiting

period, but before his disability was adjudicated and before 12 months had elapsed

from the date he first became disabled.

features, in October 1990 and again in May 1994. Appendix to Petition (“App.”)

55a. After losing his job as a teacher in October 1994, Walton attempted a series

of jobs, but he was fired from each after a brief work period, such that the

Administrative Law Judge (“ALJ”) deemed them to be unsuccessful work

attempts. App. 53a. Walton was hospitalized a third time in March 1995 and was

diagnosed at this time as suffering with paranoid schizophrenia. App. 56a. At the

time of both administrative hearings in July 1996 and June 1997, the ALJ

concluded that Walton had a Listing-level psychiatric impairment. App. 59a, 45a.

However, because Walton had attempted to work as a grocery store clerk,

beginning with part-time work in May 1995, and because he earned more than the

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substantial gainful activity (“SGA”) level of $500 in October 1995, the ALJ, after

a second administrative hearing, concluded that Walton was not under a disability

and consequently was not entitled to a period of disability, cash benefits, or a trial

work period since he had not been prevented from engaging in SGA for a

continuous period of at least 12 months. App. 44a, 45a.

‘The Appeals Council and the District Court subsequently upheld the ALJ’s

conclusions. App. 36a-38a; App. 15a-26a. On appeal, the Fourth Circuit Court of

Appeals affirmed the district court’s holding that Walton had returned to SGA in

October 1995, when his earnings exceeded $500, but reversed the district court’s

holding that Walton was not under a disability when he engaged in SGA prior to

the lapse of 12 months from his onset date and prior to adjudication of his claim

and reversed the lower court’s holding that Walton was not entitled to a trial work

period. Walton v. Apfel, 235 F.3d 184 (4 Cir. 2000), App. 2a, 7a.

REASONS FOR DENYING THE PETITION

This Court should deny the Commissioner’s Petition for a Writ of Certiorari.

The Petition buries in a footnote on the last full page of the Petition the fact that the

Fourth Circuit’s opinion in this case is in accordance with the rulings of four other

Courts of Appeals in holding that a trial work period is available if the claimant has

an impairment which has lasted, or is expected to last, at least 12 months even if he

returns to work after the five month waiting period but before 12 months from

onset of the disability. Salamalekis v. Commissioner of Soc. Sec., 221 F.3d 828

(6" Cir. 2000); Newton v. Chater, 92 F.3d 688 (8" Cir. 1996); Walker v.

Secretary of Health and Human Services, 943 F. 2d 1257 (10" Cir. 1991);

McDonald vy. Bowen, 818 F.2d 559 (7™ Cir. 1986). There is no split in the circuits

necessitating the guidance of this Court. On the issue of the availability of a trial

work period under the facts of this case, five Courts of Appeals have ruled with

one voice (and without one dissenting opinion) and no circuits have ruled

otherwise. Only the Commissioner remains unconvinced by the rulings of these

Courts of Appeals and numerous district courts which have repeatedly concluded

that Social Security’s policy is contrary to the unambiguous language of the statute

governing entitlement to disability benefits and governing entitlement to a trial

work period.

Having virtually no case law to support its position, the Commissioner relies

instead upon a new regulation which is irrelevant to this action because it did not

become effective until August 2000 and cannot be retroactively applied to this

case, 65 Fed. Reg. 42,772 (2000), and upon dire and unsubstantiated statements

regarding the supposed fiscal and programmatic impact the Fourth Circuit’s ruling

allegedly would have upon Social Security’s operations. These arguments are

without merit and are in any event inappropriate to the court’s determination

—

i

regarding the proper construction of the statute governing entitlement to disability

benefits and entitlement to a trial work period. The Fourth Circuit Court of

Appeals properly construed that statute; consequently, its ruling, and the rulings of

the four other courts of appeals, should be upheld by denying the Petition for a

Writ of Certiorari.

“Disability” is defined by the Social Security Act and regulations as the:

inability to engage in any substantial gainful activity by reason of any

medically determinable physical or mental impairment which can be

expected to result in death or which has lasted or can be expected to last for

a continuous period of not less than 12 months[.]

42 U.S.C. § 423 (d)(1)(A). As the Fourth Circuit concluded, it is evident from the

plain ianguage of the statute that the phrase “which has lasted or can be expected to

last for a continuous period of not less than 12 months” refers to the impairment,

not to the inability to engage in SGA. App. 8a. Social Security Ruling (“SSR”) 82-

52 and its successor 1995 Notice of Proposed Rulemaking, 60 Fed. Reg. 12166,

upon which the Commissioner relies', however, construes the language to mean

that “It is the inability to engage in SGA because of the impairment that must last

the required 12-month period.” SSR 82-52. Such a construction of the language is

absurd, leading, as it must, to the conclusion that the inability to engage in SGA

can be expected to result in death.

The Fourth Circuit noted: “In addition to the facial clarity of the language,

the grammatical structure and logic of the statute further compel the conclusion

that the clause, “which can be expected to result in death or which has lasted or can

be expected to last for a continuous period of not less than 12 months,’ refers to the

impairment, not to the inability to engage in SGA; the clause manifestly does not

modify ‘substantial gainful activity’.” App. 7a-8a.

The fact that it is the impairment, not the inability to engage in SGA, which

must last 12 months is supported by the language of other regulations which

further define the disability statute.

Unless your impairment is expected to result in death, it must have lasted or

must be expected to last for a continuous period of at least 12 months. We

Il this the durati

20 CFR § 404.1509 (emphases added). This is quite explicit language, clearly

linking the 12 month requirement to the impairment, not to the inability to engage

in SGA. Equally compelling is the regulation regarding unrelated severe

impairments:

We cannot combine two or more unrelated severe impairments to

meet the 12-month duration test. If you have a severe impairment(s)

' The Commissioner also relies heavily—and inappropriately—upon new final regulations found

at 65 Fed. Reg. 42,772 (2000). These regulations became effective August 10, 2000, 65 Fed.

Reg. 42772, and are inapplicable to this case.

and then develop another unrelated severe impairment(s) but neither

one is expected to last for 12 months, we cannot find you disabled,

even though the two impairments in combination last for 12 months.

20 CFR § 404.1522(a). If it were the inability to engage in SGA which must last

12 months, then it would not matter whether two or more unrelated severe

impairments were combined to meet the 12-month duration test. Instead, it is

evident from the language of these regulations that the duration requirement is met

if the impairment, not the inability to perform SGA, has lasted or is expected to last

at least 12 months.

The regulation describing the purpose of the Listing of Impairments

distinguishes between the severity of the impairment and the duration of the

impairment:

The Listing of Impairments describes, for each of the major body

systems, impairments which are considered severe enough to prevent

a person from doing any gainful activity. Most of the listed

impairments are permanent or expected to result in death, or a specific

statement of duration is made. For all others, the evidence must show

that the impairment has lasted or is expected to last for a continuous

period of at least 12 months.

20 CFR § 404.1525(a). This distinction between the severity and duration

requirements is also reflected in 20 CFR § 404.1520, regarding the evaluation of

disability in general, which states:

Your impairment(s) must be severe and meet the duration requirement

before we can find you to be disabled.

The distinction between the duration requirement and severity requirement is

also consistent with the legislative history of the disability provisions. Considering

the definition of “disability,” which was first added to the Social Security Act in

1954, the Senate Committee on Finance stated that the determination of disability

has two aspects: “(1) There must be a medically determinable impairment of

serious proportions which is expected to be of long-continued and indefinite

duration or to result in death, and (2) there must be a present inability to engage in

substantial gainful work by reason of such impairment." Stone v. Heckler, 752

F.2d 1099, 1105 (5™ Cir. 1985), quoting S. Rep. No. 1987, 83d Cong., 2d Sess. 21.

The Tenth Circuit in Alexander v. Richardson, 451 F.2d 1185 (10 Cir.

1971), cert. denied 407 U.S. 911 (1972), and the Eighth Circuit in Titus v.

Sullivan, 4 F.3d 590 (8" Cir. 1993), relied upon by the Commissioner in support of

its position that the inability to engage in SGA and the impairment must both last

12 months, blurred the distinction between the duration requirement and the

severity requirement. The Alexander court voncluded that the “Inability to engage

in any gainful activity and the impairment which causes it cannot be separated.

The two components of disability must exist at the same time.” 451 F.2d at 1186.

While the statute does require that the severity requirement (inability to engage in

SGA) and the duration requirement exist at the same time, it does not require that

? The “long-continued and indefinite duration” language was changed to the current 12 month

they coexist for 12 months in order to qualify for benefits. In addition, the facts of

Alexander and Titus suggest that no consideration was given to the availability of a

trial work period, or to the expectancy language (See pages 24-26, infra) and the

need to consider the entitlement criteria prospectively from the point of application

and to award benefits—and a rial work period--from the first month all eligibility

criteria are met (See pages 25, 27-28, infra).

Significantly, in more recent cases, the Tenth Circuit in Walker v. Secretary

of Health & Human Services, 943 F.2d 1257 (10" Cir. 1991), and the Eighth

Circuit in Newton v. Chater, 92 F.3d 688 (8" Cir. 1996), construed the language of

the statute governing entitlement to disability benefits and the statute governing

eligibility for a trial work period to conclude that benefits are payable and a trial

work period is available if the impairment was expected to last at least 12 months,

even if the return to work occurred within 12 months of onset. Although, in these

two cases, the claimant’s return to work actually occurred more than 12 months

after onset, the Tenth and Eighth Circuits’ construction of the entitlement and the

trial work period statutes is in accordance with the Fourth Circuit’s decision in this

case, the Seventh Circuit’s decision in McDonald v. Bowen, 818 F.2d 559 (7" Cir.

1986), the Sixth Circuit’s decision in

221 F.3d 828 (6 Cir. 2000), and numerous district courts’ rulings. In each of

duration requirement in 1965.

these cases, benefits were payable and a trial work period was available despite the

return to work within 12 months of onset. See pages 18-22 infra. Even if the

impairment and the inability to engage in SGA must coexist for 12 months, the

language of the entitlement statute requires that benefits be payable from the first

month all criteria are met. A trial work period is also available from the very first

month of eligibility. Therefore, if, at the time Walton returned to work, he had an

impairment--and an inability to engage in SGA--which was expected to last 12

months, then he met all the criteria of entitlement and was entitled to disability

benefits and to a trial work period.

The Fourth Circuit’s holding that the 12 month duration requirement applies

only to the impairment, in sharp contrast te the agency’s position as reflected in

SSR 82-52, properly construes the language of the statute and is consonant with

the rulings of many courts before it. The Fifth Circuit in Singletary v. Bowen, 798

F.2d 818, 821 (5" Cir. 1986), concluded that the ALJ’s determination that, because

Singletary’s condition had not prevented him from working for more than 12

continuous months, he was not entitled to disability benefits, “confuses the

duration requirement, which applies only to the impairment, with the severity

requirement, which determines whether the impairment prevents the claimant from

working.” After quoting the disability definition, the Court stated: “The statute

quite clearly requires that it is the impairment only which must last for a

continuous period. Normally, of course, when a claimant has an impairment

severe enough to prevent him from working, he will be unable to work for as long

as the impairment lasts .... The statute, however, dces not require that a claimant

be unable to engage in work during the entire 12 month period.” Id. at 821.

Other courts, construing the statutory language and the legislative history,

have also held that the duration requirement applies, not to the inability to engage

in SGA, but to the impairment itself. See, e.g.. McDonald v. Bowen, 818 F.2d

559 (7" Cir. 1986); White v. Finch, 311 F.Supp. 307 (D. Mass. 1970)(holding that

claimant was entitled to benefits because his impairment had lasted more than 12

months even though he had not been unable to work for 12 continuous months);

Hunter v. fH H ices, 851 F.Supp. 75 (E.D.N.Y.

1994); Jenkins v. Heckler, 783 F.Supp. 998 (D.S.C. 1992).

There is no doubt that Walton’s impairment has lasted more than 12 months.

The ALJ found, in his first decision, that Walton’s impairment met the criteria of

Listing 12.03, (App. 59a); and the ALJ concluded in his second hearing decision,

more than two and one-half years after Walton’s October 1994 onset date, that

Walton continued to suffer with a Listing-level impairment, App. 45a. That fact is

uncontested.

The Commissioner erroneously suggests that the Fourth Circuit’s decision

converts a long-term disability program into a short-term disability program in

contravention of Congressional intent. Petition 16. The two requirements that the

impairment be expected to last 12 months and that it be of such severity at that

time as to preclude SGA, in combination, eliminate short-term, transient

disabilities. Some impairments, although of long-term duration—e.g. controlled

hypertension—are never so severe as to prevert SGA and therefore do not meet the

severity requirement, while other impairments, although of substantial severity at

the outset, would never be expected to last 12 months and consequently do not

meet the duration requirement. In either instance, the person would be denied

disability benefits. In sharp contrast, Walton’s schizophrenia is an impairment

which satisfies both criteria: it is of such severity as to prevent SGA and it is of

documented long-term duration.

The Commissioner also suggests that there is no plausible reason why

Congress would have insisted that the impairment last 12 months, but not place a

minimum duration requirement upon the inability to work. Petition 23. This

argument is flawed for several reasons. First, there is a minimum requirement

under Title II of a five month waiting period during which disability benefits are

not payable and a trial work period is not available. In contradiction to the

Commissioner’s apparent suggestion that the five month waiting period should in

effect be expanded to a 12 month waiting period before benefits are payable,

Congress took action in 1972 to reduce the waiting period from six to five months.

The Commissioner’s argument with regard to the Supplemental Security

Insurance (“SSI”) program is also without merit.’ The SSI regulations quite

clearly show that one can engage in SGA and still have a disabling impairrnent:

“Under these rules an individual who works despite a disabling impairment may

qualify for special SSI cash benefits ... when his or her gross earned income

exceeds the applicable dollar amount which ordinarily represents SGA... .”

20 CFR § 416.260, App. 102a. This regulation demonstrates that a disabling

impairment and performance of SGA can coexist in a courageous and deterrnined

claimant, such as Cleveland Walton, who struggles against considerable odds to

work despite continuing impairment.

These regulations and Congress’ action to reduce the waiting period suggest

the reason Congress did not insist that the inability to perform SGA last 12 months.

Congress wanted to encourage disabled persons to try to work as soon as possible.

The statute regarding the trial work period and the SSI regulations both reflect

Congress’ intention to encourage, not discourage, early returns to work. The

> Although Walton applied for both Title II and SSI disability wenefits, the SSI portion has never

been at issue in this appeal. Because Walton did not appiy for SSI until April 1995, after the

five month waiting period from his October 1994 onset date had elapsed, and because SSI

benefits are not payable prior to the date of application, 20 CFR § 416.501, SSI benefits were

never truly at issue. Walton’s primary concern. ‘has always been his entitlement to Title I

disability benefits and to a trial work period under Title II.

In any event, the Commissioner’s axgument regarding SSI benefits is misplaced. SSI

claimants, like Title [I claimants, must ha:ve an impairment which is expected to last 12 months

or result in death (satisfying the duration requirement) and that impairment must be of such

severity as to prevent SGA (satisfyimg the severity requirement).

12

Commissioner’s long-standing policy, in sharp contrast, effectively penalizes those

claimants, like Cleveland Walton, who persistently try to return to work despite

continuing severe impairment. Social Security’s policy essentially tells claimants

to remain home at least 12 months before they try to work. By doing so, Social

Security discourages good faith efforts to try to work and undermines initiative, in

stark contrast to Congress’ intent to encourage early returns to work, as expressed

in the trial work period statute which makes a trial work period available from the

very first month a person is entitled to benefits.

The Commissioner’s complaints of the “profound programmatic and fiscal

implications for the Social Security programs,” Petition 17, are vague and

unsubstantiated, of doubtful accuracy, ard in any event misplaced in the judicial

arena. There is no documentation whatsoever for the dire prediction that

implementation of the Fourth Circuit decision would cost $9.8 billion over the next

ten years in the Fourth Circuit alone. Petition 15, 18. This unsupported claim was

never raised in the lower courts. Furthermore, these projected fiscal implications

seem to be based upon a fundamentally flawed characterization of Walton’s

position. Walton has never suggested that he is entitled to an award of disability

benefits for an indefinite period of time while engaged in SGA.* Rather, Walton is

* Walton was later approved for disability benefits based upon a second application and those

benefits are continuing. Walton has been unable to perform any work since November 1999 due

to his psychiatric tmpairmert.

simply seeking the award of benefits during his trial work period’ and three

successive months and for any months, during the 36 month re-entitlement period,

when he has been unable to engage in SGA. Moreover, even if these

unsubstantiated figures are accurate, they are more appropriately presented in the

legislative forum, not before this Court charged with the construction of the law. If

proper construction of the law demands that benefits be paid, the judiciary may not

refuse benefits on the basis of ill-defined fiscal constraints. Such considerations, if

valid, must be addressed to the legislative branch, not the judiciary.

The Commissioner’s argument regarding the increased administrative

burden upon the agency from the “dramatic[] increase [in] the number of

applications the agency must process” [Petition 18] if the Fourth Circuit’s decision

is implemented is also of doubtful validity. As a practical matter, claimants do not

decide whether or not to apply for disability benefits based upon a court decision

of which most claimants will be completely unaware. Further, it should not be

Social Security’s desire “to hide the ball” by discouraging disabled persons from

applying simply because there will be an increased administrative burden on the

agency.

* The regulations provide that after the trial work period has ended, the work done during the

trial work period will be evaluated to determine whether the disability ended at any time afer the

trial work period. 20 CFR § 404.1592(a).

14

A trial work period “is a period during which you may test your ability to

work and still be considered disabled.” 20 CFR § 404.1592(a). “A period of trial

insurance cash benefits. . . It cannot begin before the month in which you file your

application for benefits . .. .” 20 CFR § 404.1592(e) (emphasis added).

The requirements for entitlement to disability benefits are set out in 42

U.S.C. § 423(a\(1):

Every individual who—

(A) is insured for disability insurance

benefits. . .,

(B) has not attained retirement age . . . ,

(C) has filed an application for disability insurance benefits, and

(D) is under a disability (as defined in

subsection (d) of this section),

SS ee ee en Se © 2. ae

Inne Tr ITs) 1. JOT IOC (as defined in

subsection (cX(2) of this section) in wich he becomes so entided to euch

insurance benefits{.]

42 U.S.C. § 423(aX1 (emphasis added); See also, 20 CFR § 404.315(a).

The statute and the regulations make clear that a claimant is “entitled” to

disability benefits beginning with “the first month covered by your application in

which you meet all the other requirements for entitlement.” 20 CFR § 404.316(a)

(emphasis added). “Your period of disability begins on the day your disability

begins if you are insured for disability on that day.” 20 CFR § 404.321(a).

There is no requirement that a claimant wait 12 months prior to becoming

‘entitled’ to benefits. In fact, Congress did not intend such a delay in the award of

benefits. Congress initially imposed a six month waiting period, but chose in 1972

to reduce the waiting period to five months, in apparent recognition of the financial

hardship caused by the six month wait. “Reducing the waiting period from 6

months to 5 months would diminish the financial hardships faced by those workers

who have little or no savings or other resources to fall back on during the early

months of long-term total disability.” H. Rep. No. 231, 92d Cong., 1" Sess.

Congress obviously intended to get benefits to disabled applicants sooner rather

than later and there was no intent to make applicants wait for 12 months to see

whether they might recover from their impairment. “Congress could have easily

required, as does S.S.R. 82-52, a waiting period of a year before awarding any

benefits. But it is evident from an analysis of the statute that, as a matter of policy,

it chose not to do so.” Hunter, supra, 851 F.Supp. at 77.

Based upon the plain language of the statute and regulations, Walton was

“entitled” to disability benefits, and consequently to a trial work period, beginning

with the first month he met all the requirements. As of April 1995, prior to the

beginning of his attempt to work at Food Lion, Walton met all the requirements for

entitlement status: he was insured; he had not reached retirement age; he had

applied; and he had been disabled for five consecutive months. He had a disability

as defined by 42 U.S.C. § 423 (d)(1XA) because he had a severe mental

impairment which was expected to last for a continuous period of at least 12

months.’ Because Walton met all the criteria in April 1995, he was “entitled” to

disability benefits beginning that month; and therefore, according to the plain

language of the statute and supportive regulations, he was also entitled, at that

time, to a trial work period.

The Fourth Circuit’s construction of the statute and regulations is in

accordance with the rulings of four other Courts of Appeals and numerous district

courts throughout the nation which have held that a claimant is entitled to a trial

work period if he has an impairment which has lasted, or is expected to last, at

least 12 months even if he returns to work after the five month waiting period but

before 12 months from onset of the disability. These Courts, consistent with the

language of the statute and regulations, have focused quite properly on the five

month waiting period because the statuie and regulations require that benefits be

° A medical expert concluded prior to Walton’s first hearing that Walton’s impairment met the

criteria of Listing 12.03 and that his impairments had lasted or could be expected to last at least

12 months. App. 56a-57a. The ALJ found that Walton’s did meet the criteria of

Listing 12.03 and that his impairment “has precluded him from working for at least 12

continuous months.” App. 59a.

17

paid in the first month all criteria are met, including passage of the waiting period,

and they clearly state that a trial work period is available from the very first month

in which a person becomes entitled to benefits.

The precedential case of McDonald y. Bowen, 818 F.2d 559, 564 (7 Cir.

1986), held that an “individual who suffers from an impairment that is expected to

last at least twelve consecutive months is entitled to benefits (as well as to a trial

work period) after completing the five-month waiting period.” Even though the

claimant had returned to work before the hearing and before 12 months had

elapsed from the date of onset, the Court concluded that the Secretary was required

to determine whether the claimant suffered from an impairment which was

reasonably expected to last 12 months and whether the claimant had been disabled

for five continuous months prior to her return to work; if so, then the Secretary was

required to decide whether a nine-month trial work period covered her return to

work and could not deny benefits to one enjoying a trial work period “on the basis

that she had thereby demonstrated an ability to engage in substantial gainful

activity.” Id. at 565.

Likewise, the Tenth Circuit in Walker v. Secretary of Health & Human

Services, 943 F.2d 1257 (10” Cir. 1991), concluded that an individual who suffers

with an impairment which has lasted, or is expected to last, 12 months is entitled to

disability benefits and to a trial work period after waiting five months. Similarly,

the Eighth Circuit in Newton v. Chater, 92 F.3d 688, 694 (8 Cir. 1996), rejected

the rationale of SSR 82-52 and held:

According to the statute and regulations, though, a trial work period

starts in the month that entitlement to disability benefits begins, which

is the month following five consecutive months of being under a

disability that has lasted or is expected to last a total of twelve

continuous months. . . In other words, under the statute, a claimant

need not have had a disability for twelve consecutive months before

he may test his ability to work.

Most recently, the Sixth Circuit in Salamalekis v. Commissioner of Social

Security, 221 F.3d 828 (6" Cir. 2000), ruled that the claimant was entitled to

disability benefits and to a trial work period despite his return to work within 12

months of his onset date. The Court noted that, pursuant to the plain language of

the Act, a person can take advantage of a trial work period once he becomes

entitled to disability benefits—that is, once he establishes the five prerequisites of

entitlement: insured status, is under retirement age, has filed an application, the

five month waiting period has expired, and is under a disability. The Court

explicitly rejected the Commissioner’s position that Salamalekis’ return to work

within 12 months of onset precluded a finding of disability:

This position ignores the complete definition of disability under the

Act, which covers not only those impairments that actually last 12

months, but also those impairments expected to last 12 months. At

the time Salamalekis returned to work on March 2, 1992, his

impairment was ongoing and was expected to last for 12 months, and

the SSA so found. A claimant who meets Congress’s prospective

standard for disability cannot be denied benefits based on hindsight.

Id. at 832.

Repeatedly, district courts throughout the nation have adopted the rationale

of the McDonald, Walker, Newton and Salamalekis courts, and their construction

of the statute and regulations, to conclude that a claimant who has an impairment

which has lasted, or is expected to last, at least 12 months is entitled to a trial work

period, after the five month waiting period, even if he or she returns to work within

12 months of the onset date. See, e.g., Mulderig v. Sullivan, 1993 WL 22152

(S.D.N.Y. 1993)retum to work 11 months after onset date did not preclude

entitlement to a trial work period and to disability benefits. “Therefore, if a

claimant has filed an application, and has been disabled for five months from an

impairment which is expected to last for at least twelve months, he is ‘entitled’ to

benefits and, in turn, a trial work period.”); Fabel v. Shalala, 891 F.Supp. 202

(D.N.J. 1995)(despite claimant’s return to SGA eight months after her onset date,

she was entitled to benefits and to a trial work period because she had met the four

statutory requirements and was therefore “entitled” to benefits five months after

the date her disability commenced, regardless of when SSA formally awarded

benefits, and a person “entitled” to benefits may also engage in a trial work

period); ices, 851 F.Supp. 75

(E.D.N.Y. 1994)(because there was the expectation that Hunter would remain

disabled, she was entitled to disability benefits and to a trial work period even

though she returned to work within 12 months of her onset date); Wilson v.

Shalala, 841 F.Supp. 1491(E.D. Wash. 1994)(despite claimant's return to work six

months after onset, she was entitled to disability benefits, and therefore to a trial

work period, once she had filed an application and been disabled for a period of

five consecutive months); 17

F.Supp. 156 (W.D. Ark. 1989)(claimant who returned to work 11 months after

onset was entitled to a trial work period unless, at the time of the return to work,

her disability had not laste*, and could not have been expected to last, 12 months);

Goldstein v. Harris, 517 F.Supp. 1314, 1316-17 (S.D.N.Y. 1981)(ALJ erred in ©

concluding that claimant’s return to work more than five months after onset

precluded entitlement to disability benefits and eligibility for a trial work period.

“Once a person becomes eligible for disability-insurance benefits—i.e., five

months after the onset of the disability, 42 U.S.C. § 423—he may commence a trial

work period.”); Darring v. Callahan, 1997 U.S. Dist. LEXIS 15187, 15161 (S.

Ala. 1997)(follows Seventh, Eighth and Tenth Circuit precedent to conclude that

Commissioner had erred in failing to consider whether work performed within 12

months of onset date should be considered trial work if claimant suffered from an

impairment which, as of the onset date, was reasonably expected to last at least 12

months and if claimant had been disabled five months prior to his return to work);

ices, 835 F.Supp. 1182 (C.D. Cal.

21

1993) (conc,uding that claimant, whose impairment was expected to last more than

12 months, was entitled to a trial work period after the five month waiting period

even though he had returned to work within 12 months of onset); Jenkins v.

Heckler, 783 F.Supp. 998 (D.S.C. 1992).

In each’ of these cases, the claimant had returned to work prior to final

adjudication of their claim and within 12 months of their onset date. Each court

interpreted the language of the statute and regulations regarding entitlement to

benefits and to a trial work period to hold that a claimant is “entitled” to disability

benefits—and therefore to a trial work period—in the first month he meets all the

criteria, including passage of the five month waiting period, and therefore held that

these claimants were entitled to a trial work period.

Likewise, in the case at bar, if, as the medical record clearly establishes,

Walton had an impairment which was expected to last at least 12 months, then he

was entitled to disability benefits beginning in April 1995, when his five month

waiting period had elapsed. Consequently, his return to work in May 1995 must be

considered as part of a trial work period and Social Security may not deny. benefits

to Walton on the basis that he had, by that work, demonstrated an ability to engage

in SGA. McDonald, supra, 818 F.2d at 565 (“Absent any medical or other

” With the exception of Newton and Walker, where the return to SGA occurred more than 12

months after onset, in all the other cited cases the return to SGA occurred after the five month

waiting period but within 12 months of the onset date.

22

evidence that demonstrates that plaintiff was able to engage in substantial gainful

activity, the Secretary may not deny benefits to an individual enjoying a trial work

period on the basis that she had thereby demonstrated an ability to engage in

substantial gainful activity.”).

In contrast to the Commissioner’s position, the Fourth Circuit and other

courts’ conclusion is fully in accordance with the language of the statute and

regulations and is consistent with the legislative history as well. Congress did not

intend for claimants to wait 12 months to see whether their impairment would

improve--or, under the Commissioner’s interpretation of the disability definition--

to see whether they would return to work, within 12 months. Congress did impose

a waiting period during which no Title II disability benefits could be paid to

accommodate its concern that persons with truly short-term impairments would not

be paid disability benefits. Congress certainly could have imposed a 12 month

waiting period, but it chose not to do so. In sharp contrast to Congress’ 1972 action

to reduce the waiting period, the Commissioner’s interpretation would effectively

increase the waiting period to 12 months.

To interpret the statute as the Commissioner does leads to a result which is

either contrary to the language of the statute and regulations, or which is patently

unfair and-arbitrary on its face. The Commissioner suggests that the Agency could

decide a claim within 12 months of the alleged onset and apply the “can be

expected to last at least 12 months” language to approve benefits. Petition 25.

Applying the Commissioner’s reasoning, a person could be approved for benefits

prior to the end of the 12 months based upon an expectancy and still return to work

within 12 months of onset. What then? Either the benefits, which had already

been awarded, would be deemed overpayments and subject to recoupment, in clear

contradiction to the expectancy language of the statute, or, if the beneficiary is

allowed to retain those benefits, he is arbitrarily being treated in a more favorable

manner than the claimant whose disability case is not finally adjudicated until

more than 12 months after onset. Neither result is justifiable.

If the person who is paid benefits based upon the expectation that he would

be unable to engage in SGA for more than 12 months but who then returns to SGA

within 12 months of onset is forced to repay those benefits, then the Commissioner

has effectively eliminated the “can be expected to last” provision out of the statute,

because no one is entitled to keep benefits unless their disability has, in fact, lasted

at least 12 months. Such an interpretation effectively changes the five month

waiting period to a 12 month waiting period, in contradiction to the explicit

language of the statute and regulations and in contradiction to the expressed

intention of Congress.

The Sixth Circuit considered this problem in Sierakowski y. Weinberger,

504 F.2d 831 (6" Cir. 1974). In that case, the claimant had been approved for

disability benefits based upon the belief that his impairment wes reasonably

expected to last for more than 12 months. When he returned to work within 12

months of his onset date, the Appeals Council, on its own motion, concluded that

he was never entitled to a period of disability because he had returned to work

within 12 months of onset. The Sixth Circuit concluded that Sierakowski’s return

to work did not oblige him to repay the benefits he had received.

The result reached by the Secretary and by the District Court is to read

into the statute a provision for the conditional payment of benefits,

repayable where the expected duration does not develop, unless

excused under Section 404(b). We find nothing in the statutory

language to support such a view, and much in the legislative history to

refute it. The statute plainly says that it permits benefits where the

inability “can be expected to last for a continuous period of not less

than twelve months.” We conclude that by the use of the cited

language the Congress established a prospective standard whereas the

Secretary urges one governed by hindsight.

We recognize that the construction urged by the Secretary results

perhaps in more certainty and is thus easier of application, but this

does not, in our view, justify a departure from Congressional intent.

Furthermore, that construction tends to penalize good faith and

diligence. It takes little imagination to conclude that a claimant less

motivated than plaintiff here would be sorely tempted to sit out the

full twelve months if he knew that the law imposed such a forfeiture

for an earlier return to gainful activity.

Id, at 833-35.

Similarly, in Kendrick y. Califano, 460 F.Supp. 561 (E.D. Va. 1978), the

Court declined to require the repayment of benefits received despite the claimant’s

return to work within 12 months of onset.

It is apparent . . . that the Secretary construed the Social Security Act

as allowing benefits only when the claimant is in fact precluded from

working for a continuous twelve-month period. Applying this

interpretation, the Secretary denied benefits because plaintiff's disease

has never forced him to refrain completely from work for a period of

one year. The Court finds that this interpretation of the Act is

erroneous in two respects.

First, the Act requires neither that the disability actually continue for

12 months nor that the claimant in fact be unable to work for 12

months. There are two steps to a finding of ‘disability’: first, a

finding of a medically determinable physical or mental impairment

which can be expected to result in death or has lasted or can be

expected to last for a continuous period of at least 12 months; second,

a finding that the impairment in fact causes an inability to engage in

any substantial gainful activity .... The Act clearly allows benefits

not only for those whose impairments last for a continuous i12-month

period, but also for those whose impairments are expected to last for

12 months. The expectation, not the reality, of a 12-month

impairment is sufficient.

The significant point here is that a claimant whose disability was

expected to last at least twelve months does not automatically lose

entitlement to all benefits he received merely because he worked

within the 12-month period.

Id. at 567 (citations omitted).

The Commissioner suggests that the Fourth Circuit’s ruling regarding the

availability of a trial work period is dependent upon its resolution of the duration

requirement. Petition 23 and fn. 8, p. 23. The Court concluded that under the

statute a trial work period “shall begin with the month in which [the claimant]

becomes entitled to disability insurance benefits.” App. 9a-10a. Because Walton

met all requirements of entitlement as of April 1995, he was entitled to benefits

and to a trial work period. Id. The availability of a trial work period under the

facts of this case is not dependent upon a finding that the 12 month duration

requirement applies to the impairment, not the inability to engage in SGA. Rather,

the expectancy language of the disability definition and the prospective perspective |

required by the entitlement statute, in combination, assure that a trial work period

is available in this case even if the 12 month duration requirement applies to the

inability to engage in SGA.

The language of the statute requires that a prospective perspective be used

from the date of application to assess whether all five prerequisites are met.

Congress dictates this result by stating that benefits must be payable from the first

month that all requirements are met, including passage of the five month waiting

period. The Court in Nappa v. Secretary of U. S. DHHS, 731 F.Supp. 579, 585

(E.D.N.Y. 1990), concluding that the claimant was not entitled to a trial work

period because her work was performed prior to her application, recognized the

prospective standard which Sierkowski and McDonald applied. “Although the

requirement of a swelve month continuous disability is ‘forward-looking and is not

to be nullified by hindsight,’ it is evident that it is forward-looking from the point

an application is filed.” Id. (emphasis added). Likewise, the Sixth Circuit in

Salamalekis applied a prospective standard for assess.ng disability which could not

be reversed in hindsight. Salamalekis, supra, 221 F.3d at 832.

At the point Walton filed his application, he had an impairment—and an

inability to engage in SGA--which was expected to last 12 months and therefore he

was entitled to disability benefits and to tris! work period once his five month

waiting period passed. To consider the requirements in hindsight after the 12

months have elapsed is contrary to the statute and regulations because it fails to

award benefits in the first month in which all the statutory requirements are

satisfied and in each successive month thereafter. Moreover, it reads into the

statute a 12 month waiting period, which Congress did not impose and did not

intend.

Even if the Commissioner’s interpretation allows a claimant already

approved for benefits to retain those benefits if he returns to work within 12

months of onset, that result would be unfair and arbitrary with respect to those

claimants, like Walton, whose disability is not finally adjudicated within 12

months of onset. They are treated differently for the sole reason that Social

Security did not adjudicate their case in a timely manner. As the Fourth Circuit

noted, neither § 423 (a1) nor § 423(d) mentions adjudication as a prerequisite to

disability or entitlement to disability benefits. App. 13a. Similarly, the Sixth

Circuit in Salamalekis refused to make the award of benefits, a factor dependent

upon the agency’s conduct, an additional prerequisite to trial work eligibility,

finding such a prerequisite to be contrary to Congress’ unambiguous intent. 221

© . ©

F.3d at 833-4. The Hunter Court also recognized the inequity of making an award

of benefits or a trial work period contingent upon agency action: “The point at

which the Secretary comes to acknowledge the existence of a disability is not and

should not be a consequential factor in the calculus of entitlement, let alone a

determinative one.” Hunter, supra, 851 F.Supp. at 77.

Finding that a trial work period is available despite a return to work within

12 months of onset is not, as the Commissioner suggests (Petition 23, fn 8), in

conflict with the holding of Cieutat v. Bowen, 824 F.2d 348 (5" Cir. 1987). That

case held only that a trial work period cannot begin prior to filing an application

for benefits. Id. at 359. Walton’s trial work period did not begin until after his

application for benefits and therefore his position in no way conflicts with the

Cieutat holding.

Because the Commissioner’s interpretation of the statute and regulations is

inconsistent with the plain language of the Act, this Court should not defer to the

Agency’s interpretation. “If the intent of Congress is clear, that is the end of the

matter; for the court, as well as the agency, must give effect to the unambiguously

expressed intent of Congress.” Chevron, U.S.A.. Inc. v. Natural Resources

Defense Council, Inc., 194 S.Ct. 2778, 2781 (1984). The Fourth Circuit in its

decision recognized Chevron deference where it is due, but concluded that in this

case no deference was due: “In the first place, agency interpretation of the Act is

_ Mot appropriate because the language of the statute is clear and unambiguous.

Moreover, even if interpretation were required, the Commissioner’s

interpretation—which assumes either a duration period or adjudication requirement

and does violence tc the grammatical structure of the statute—conflicts with the

very statute it purports to elucidate. We are bound to reject such constructions.”

‘App. 6a-7a. Similarly, the Sixth Circuit in Salamalekis concluded that no

deference was due: “Here, however, no deference is due because we find SSR 82-

52, and the agency’s position in this case, to contradict the plain language of the

governing statute, 42 U.S.C. § 422 (c).” 221 F.3d at 832.

The lengthy list of cases rejecting SSR 82-52° demonstrates that the courts,

while explicitly recognizing the deference due the Agency, have repeatedly

concluded that no deference was due in this instance because the Agency’s

position is contrary to the express language of the statute and regulations. The

Newton court certainly recognized the deference often due an agency’s

interpretation of its own regulations but nevertheless rejected the Agency policy of

SSR 82-52. “While courts must give deference to an agency’s interpretation of its

* The Agency’s March 6, 1995 Notice of Proposed Rulemaking (“NPRM”) is merely a

restatement of the policy of SSR 82-52. “These revisions . . . do not represent a change in

policy. ...” 60 Fed. Reg. 12166, 12168 (March 6, 1995). There is nothing in the NPRM to

suggest that those courts which rejected the policy of SSR 82-52 would rule any differently when

considering the very same policy as explained anew in the NPRM. Both the Fourth Circuit in this

therein.

own regulations, courts are not bound by them and they are not conclusive . . . .

The agency ruling, SSR 82-52, is inconsistent with the statutory provision

governing the start of the trial work period.” Newton, supra, 92 F.3d at 693-4.

Likewise, the court concluded in Hunter, supra, 851 F.Supp. at 77, that “On its

face, S.S.R. 82-52 contradicts the plain language of the Social Security Act’s

definition of ‘disability.’ More importantly, S.S.R. 82-52 undercuts, if it does not

nullify, the Act’s ‘trial work period’ policy, which seeks to encourage the disabled

to return to work as soon as possible ... .” Similarly, the Fabel court recognized

the level of deference due the Agency’s interpretation of the statute but nonetheless

concluded: “Despite this level of deference, the Court finds the SSR 82-52 is

plainly erroneous and inconsistent with the Act.” Fabel, supra, 891 F.Supp. at 206.

The Tenth Circuit in Walker, supra, 943 F.2d at 1260, also recognized the

deference due the Agency but nonetheless rejected its policy and its failure to

apply the ruling of McDonald nationwide: “In our view, the Social Security

Administration’s rejection of the Seventh Circuit’s position in McDonald is

inconsistent with the language of the Act and, therefore, Acquiescence Ruling 88-

3(7) is entitled to no deference.”

~

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Fee oe

Ms iS

CONCLUSION

The Petition for a Writ of Certiorari should be denied. In marked contrast to

the circumstances under which this Court granted certiorari in Bowen v. Yuckert,

482 U.S. 137 (1987), there is no difference of opinion among the courts of appeals

regarding entitlement to a trial work period under the facts of this case. In|

Yuckert, nearly all of the circuits had considered the validity of the severity

regulation and the courts of appeals had split nearly evenly on the question of the

regulation’s validity. Id. at 145, fn 4, 155 fn 1, 2. In the instant case, however,

five courts of appeals have considered the question of when a trial work period is

available and five courts of appeals have ruled consistently and without variation

or even a dissenting opinion, all concluding that a trial work period is available to a

claimant with a severe impairment which has lasted or is expected to last 12

months, even if the claimant returns to substantial gainful activity within 12

months of onset. Because there is no conflict among the circuits, there is no need

for this Court’s guidance on this issue and therefore no need for this Court to grant

The fact that the Commissioner’s policy is of longstanding duration provides

no compelling reason to accept this case for review. During the several decades

that Social Security has implemented this policy, it has been repeatedly advised by

court after court (See pages 18-22, infra) that its’ policy was contrary to the

explicit language of the statutes governing entitlement to benefits and governing

entitlement to a trial work period. The fact that the Commissioner has chosen to

ignore scores of court rulings throughout the nation and has chosen to continue to

implement its flawed policy outside the Seventh, Tenth, Eighth, and Sixth Circuits

only underscores the need for finality here. By refusing to grant a writ of certiorari

in this case, this Court could send a message to Social Security that the decisions

of those circuits must stand and that the decision of the Fourth Circuit Court of

Appeals must be applied throughout the circuit. Denial of this certiorari petition

will also allow Cleveland Walton to finally reach some closure on this case which

has been ongoing in one forum or another for more than six years.

The petition for a writ of certiorari should be denied.

Respectfully submitted,

Cleveland B. Walton, Jr.

By Counsel

Kathryn L. Pryor

Counsel for Cleveland B. Walton, Jr.

Central Virginia Legal

Aid Society, Inc.

101 West Broad Street, Suite 101

P. O. Box 12206

Richmond, Virginia 23241

(804) 648-1012

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