Petition for Writ of Certiorari — Bowen v. Polaski

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In the Supreme Court of the United States

OCTOBER TERM, 1985

MARGARET M. HECKLER, SECRETARY OF HEALTH

AND HUMAN SERVICES, PETITIONER

Vv.

LORRAINE POLASKI, ET AL.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

CHARLES FRIED

Acting Solicitor General

RICHARD K. WILLARD

Acting Assistant Attorney General

KENNETH S. GELLER

Deputy Solicitor General

EDWIN S. KNEEDLER

Assistant te the Solicitor General

WILLIAM KANTER

HOWARD S. SCHER

Attorneys

Department of Justice

Washington, D.C. 20530

(202) 633-2217

emie Court, US,

ik D

JH Ll 1985

ALEXANDER L. STEVAS,

CLERK

~ BEST AVAILABLE COPY

QUESTION PRESENTED

Whether, in this class action under 42 U.S.C. 405(¢)

challenging the weight the Secretary accords to a

person’s allegations of pain in determining whether

he is entitled to disability benefits under the Social

Security Act, the district court correctly included

within the class numerous claimants who had not

exhausted their administrative remedies and there-

fore had not obtained a “final decision” of the Secre-

tary on their individual claims for benefits.

(I)

PARTIES TO THE PROCEEDINGS

The petitioner is the Secretary of Health and

Human Services.

The named respondents are Lorraine Polaski and

Patrick Blaschko. These two respondents are repre-

sentatives of the following class certified by the dis-

trict court (Pet. App. 51a-52a) :

All persons residing in Minnesota, North Dakota,

South Dakota, Missouri, Nebraska, Iowa, or

Arkansas,

a) who have been or will be notified that their

applications for Title II and/or Title XVI ben-

efits have been denied or that their Title II and/

or Title XVI benefits are being terminated on

medical or medical vocational grounds; and

b) who allege that they are unable to work in

whole or in part because of pain or other sub-

jective complaints and/or that their medical con-

dition has not improved; and

¢c) who are pursuing or will pursue timely ad-

ministrative or judicial appeals, or, if not pur-

suing timely appeals, who have received or will

receive an adverse decision at any level of the

administrative review process on or after Jan-

uary 30, 1984, provided however that,

(1) as to those who are residents of Arkan-

sas and who have been or will be notified

that their applications for Title II and/or

Title XVI benefits have been denied, the

class includes only (a) those who are pur-

suing or will pursue timely judicial ap-

peals and (b) those who are pursuing timely

administrative appeals at the Administra-

tive Law Judge or Appeals Council level, and

Ill

adverse decision at the Administrative Law

Judge or Appeals Council level on or after

February 20, 1984;

(2) as to those who are residents of Arkan-

sas and who have been terminated from

Title I] and/or Title XVI benefits, the class

also includes those who have received or will

receive an adverse decision at any level of

the administrative review process on or

after February 12, 1983; and

(3) as to those who are residents of Iowa

and who have been or will be notified that

their applications for Title II and/or Title

XVI benefits have been denied, the class also

includes those who have received an adverse

decision at any level of the administrative

review process on or after November 26,

1983; and

(4) as to those who are residents of Iowa

and who have been or will be terminated

from Title II and/or Title XVI benefits, the

class also includes those who have received

or will receive an adverse decision at any

level of the administrative review process

on or after January 13, 1982;

d) provided, further, however, that the class of

persons whom plaintiffs represent shall exclude

persons who are members of class actions which

have been certified in any court in the Eighth

Circuit which challenge the Secretary’s policy

with regard to a medical improvement standard

or the evaluation of pain and other subjective

complaints; provided that such persons shall be

excluded from this class only with regard to the

issue or issues actually being litigated in such

other certified class actions.

TABLE OF CONTENTS

Page

Opinions below ............ RE EPP een Boone ~ 1

oe ccrecrtsyscs supose ee eed 2

Statutory provisions involved .................... PE SIS IIT 2

NT isa caccsscsnasinw pect ome eerie 2

Reasons for granting the petition -............ MRR AL SS Lae 12

CIO 55k co FLERE LAAN 16

TABLE OF AUTHORITIES

Cases:

City of New York v. Heckler, 742 F.2d 729, petition

for cert. pending, No. 84-1923 _..... 2- 3, 10, 12, 13, 14, 16

Heckler v. Kuehner, No. 83-1593 (Nov. 5, 1984)...... 9,15

Heckler v. Lopez, No. 84-115 (Dec. 10, 1984) - 9

Heckler v. Owens, appeal docketed, No. 84. 1905

Fe | eRe eR RA SIM PE ren LOR RN NUYS SYS 12-13, 16

Heckler v. Ringer, No. 82-1772 (May 14, 1984) _....... 12, 18

Hyatt v. Heckler, 767 F.2d 1455 .................ccc0cccs2520.-.- 12

Mathews Vv. Eldridge, 424 U.S. 319 .................... $3, 11, 12,138

Weinberger V. Salfi, 422 U.S. 749............................... 13,14

Statutes and regulations:

Social Security Act, 42 U.S.C. 301 et seq.:

Title II, 42 U.S.C. 401 et seq.: \

§ 205(g), 42 U.S.C. 405(g).. ... 1, 2, 4,6, 6, 7, 10,

12, 14, 15

§ 223(d) (1) (A), 42 U.S.C. 423(d) (1)

UE ctnccusisuceaaamaaieatt iaamaeuns ie amemmaneteerees 3

3(d) (3), 42 U.S.C. 423 (d) (3) ~...... 3

Title XVI, 42 U.S.C. 1381 et seq.:

§ 1614(d) (8) (A), 42 U.S.C. 1382¢ (a) (3)

YD RRNA Ween arrests CANT CONROE DP 3

§ 1614(a) (3) (C), 42 U.S.C. 1382c(a) (3)

(Vv)

Statutes and regulations—Continued : Page

Socia! Security Disability Benefits Reform Act of

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

§ 2, 98 Stat. 1794 RIND PR ATim nar oe OE 9,10, 15

§ 3, 98 Stat. 1799 ioe me

. Bis Tia: | eee sosac ueacesgectunea aenaeeeane 7

20 C.F.R.:

Section 404.1590 ..........-.-2<<sscscccagesessnssaxveseopanseoe==a= 3

Rae tars BUG GID noises viavccictnciorned recesernneens 3

Iu the Supreme Court of the United States

OCTOBER TERM, 1985

No.

MARGARET M. HECKLER, SECRETARY OF HEALTH

AND HUMAN SERVICES, PETITIONER

Vv.

LORRAINE POLASKI, ET AL.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE EIGHTH CIRCUIT

The Solicitor General, on behalf of the Secretary

of Health and Human Services, petitions for a writ

of certiorari to review the judgment of the United

States Court of Appeals for the Eighth Circuit in

this case.

OPINIONS BELOW

The opinion of the court of appeals (Pet. App. 1la-

26a) is reported at 751 F.2d 943, and the July 17,

1984 order of the court of appeals approving the

parties’ settlement agreement as to one issue (Pet.

App. 27a-8la) is reported at 739 F.2d 1320. The

April 17, 1984 order of the district court certifying

the plaintiffs’ class and entering a temporary re-

straining order (Pet. App. 32a-45a) is reported at

585 F. Supp. 997, and the April 27, 1984 order of

(1)

the district court amending the class certification and

entering a preliminary injunction (Pet. App. 46a-

81a) is reported at 585 F. Supp. 1004.

JURISDICTION

The judgment of the court of appeals (Pet. App.

82a) was entered on December 31, 1984. The order

denying the Secretary’s petition for rehearing (id. at

83a) was entered on pee i] 16, 1985, and an amended

order was entered on April 19, 1985 (id. at 84a). The

jurisdiction of this Court is invoked under 28 U.S.C.

1254(1).

STATUTORY PROVISIONS INVOLVED

Section 205(g) of the Social Security Act, 42

U.S.C. 405(g), and Section 3 of the Social Security

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

98-460, 98 Stat. 1799, are reproduced at Pet. App.

85a-89a.

STATEMENT

This is an Eighth Circuit-wide class action chal-

lenging the weight accorded by the Secretary of

Health and Human Services to a claimant’s allega-

tions of pain in determining whether he is entitled

to disability benefits under Title II or Title XVI of

the Social Security Act. In this petition, we seek

review of the court of appeals’ requirement that the

Secretary reopen decisions of thousands of applicants

for disability benefits who did not exhaust their

administrative remedies and obtain a “‘final decision”’

of the Secretary on their claims for benefits, which is

a prerequisite to jurisdiction under 42 U.S.C. 405(g).

This question concerning exhaustion of administra-

tive remedies is similar to that presented in Heckler

a ee eee

v. City of New York, petition for cert. pending,

No. 84-1923 (filed June 7, 1985).’

1. Under both Title II and Title XVI of the Social

Security Act, the term “disability” is defined to

mean the “inability to engage in any substantial gain-

ful activity by reason of any medically determinable

physical or mental impairment” that can be ex-

pected to result in death or to last for 12 months.

42 U.S.C. 428(d)(1)(A) and 1382¢(a) (3) (A).

The impairment must be one that “results from ana-

tomical, physiological, or psychological abnormalities

which are demonstrable by medically acceptable clin-

ical and laboratory diagnostic techniques.” 42 U.S.C.

423(d)(8) and 1882¢e(a)(3)(C). See Mathews v.

Eldridge, 424 U.S. 319, 386 (1976).

Implementing regulations provide that a claimant

will not be found to be disabled under these statu-

tory standards on the basis of his symptoms, inelud-

ing pain, “unless medical signs or findings show that

there is a medical condition that could be reasonably

expected to produce those symptoms.” 20 C.F.R.

404.1529, 416.929. In Social Security Ruling (SSR)

82-58, the Social Security Administration (SSA) ex-

plained that the decisionmaker must consider the

impact. of the pain or other symptoms on the claim-

ant’s residual functional capacity to do his previous

work or other substantial gainful work that exists in

the national economy. SSR 82-58 required a consid-

eration of both subjective and objective factors in

making this assessment, including the claimant’s al-

legations concerning the frequency and duration of

the pain, precipitating and aggravating factors, the

effect on the claimant’s daily activities, the effect of

1 We are sending a copy of our petition in City of New York

to counsel for respondents.

medication, and recorded observations about the pain

by examining physicians and SSA personnel. See

Pet. App. 10a-14a, 29a-30a, 58a.

2.a. Respondent Lorraine Polaski received dis-

ability benefits under Title II of the Social Security

Act beginning in 1979 (Pet. App. 33a). Her eligibil-

ity subsequently was reviewed, and the state agency

determined that her disability had ceased as of June

1982, because she was then able to engage in sub-

stantial gainful activity. Polaski was so informed

in an initial determination dated July 26, 1982 (P.

Tr. 166).° That decision was sustained on reconsider-

ation (P. Tr. 169), and an Administrative Law

Judge (ALJ) rendered a decision to the same effect

after a hearing (P. Tr. 23-30). The ALJ stated

that Eighth Circuit precedent permits a finding of

disability based on the claimant’s subjective com-

plaints of pain if there is no factual basis in the

record for rejecting the claimant’s testimony (P. Tr.

28). But the ALJ stressed that symptoms, including

pain, are insufficient to establish disability unless

medical findings or signs show that there is a medical

condition that could reasonably be expected to produce

those symptoms, and that the mere assertion of pain

does not foreclose the ALJ from finding that the

claimant’s complaints lack credibility to establish an

impairment of the requisite severity (ibid.). After

reviewing the evidence under these principles, the

ALJ concluded that “the record does not establish

the existence of pain of such intensity and frequency

so as to preclude [Polaski] from engaging in all

2“Pp. Tr.” refers to the transcript of the administrative

record in respondent Polaski’s case that was filed by the Secre-

tary in district court pursuant to 42 U.S.C. 405(g). “B. Tr.”

refers to the transcript in respondent Blaschko’s case.

types of competitive work activity” and that Polaski

could work in a “relatively low-stress, ‘unskilled’

work environment” (7bid.). The Appeals Council

denied review of the ALJ’s decision on November 28,

1983 (P. Tr. 6-7).

After thus exhausting her administrative remedies,

respondent Polaski filed a civil action on January 20,

1984 in the United States District Court for the Dis-

trict of Minnesota pursuant to 42 U.S.C. 405(¢),

seeking judicial review of the Secretary’s final deci-

sion that her disability had ceased. On April 3, 1984,

she sought to amend the complaint to represent a

class of claimants in the Eighth Circuit. Polaski

alleged that the Secretary was “nonacquiescing” in

Eighth Circuit case law (i) that addressed the con-

sideration of subjective complaints of pain and (ii)

that, in Polaski’s view, required the Secretary to

find improvement in a recipient’s medical condition

before terminating his disability benefits (Pet. App.

32a-33a).

b. On April 17, 1984, the district court granted

Polaski’s motion to amend the complaint, certified

an Eighth Circuit-wide class, and entered a Circuit-

wide temporary restrainting order (Pet. App. 32a-

45a).* The class is defined to include all persons re-

3 The district court also granted the motion by respondent

Patrick Blaschko to intervene (Pet. App. 34a). Blaschko,

like Polaski, was a prior recipient of disability benefits whose

benefits were terminated. As in Polaski’s case, the ALJ ex-

pressly cited Eighth Circuit precedent concerning the evalua-

tion of pain, but concluded on the basis of all of the evidence

that Blaschko’s pain was not of sufficient severity to preclude

him from engaging in substantial gainful activity (B. Tr. 14-

16). The Appeals Council denied Blaschko’s request for re-

view on January 17, 1983 (B. Tr. 3-4), and he thereafter filed

an individual action for judicial review in the United States

siding in the Eighth Circuit who have been or will be

notified that their applications for disability benefits

have been denied or that their benefits have been ter-

minated; “‘who allege that they are unable to work in

whole or in part because of pain or other subjective

complaints and/or that their medical condition has

not improved”; and “who are pursuing or will pur-

sue timely administrative or judicial appeals, or, if

not pursuing timely appeals, whe have received or

will receive an adverse decision at any level of the

administrative review process on or after January

30, 1984” (Pet. App. 51a-52a). The latter date was

selected to comply with the requirement in 42 U.S.C.

405(g) that a claimant seek jindicial review within

60 days of the Secretary’s final decision on his claim

for benefits (Pet. App. 28a-24a n.4).*

District Court for the District of Minnesota on March 15,

1983, pursuant to 42 U.S.C. 405(g). Blaschko v. Heckler, Civil

No. 4-83-233. Blaschko’s action was assigned to a different

judge (Murphy, J.) than the judge who decided the instant

case (Lord, C.J.).

By order dated March 7, 1984, the district court remanded

Blaschko’s individual case to the Secretary for further pro-

ceedings in accordance with a magistrate’s report dated Febru-

ary 23, 1984, which concluded that the ALJ had incorrectly

discredited Blaschko’s subjective complaints of pain. Thus,

Blaschko’s own individual action under 42 U.S.C. 405(g) had

already been resolved when the district court permitted him to

intervene in the instant case. We have been informed by

HHS that, after the remand, the Appeals Council rendered a

decision fully favorable to Blaschko on January 12, 1985.

4The district court adopted beginning dates other than

January 30, 1984 for class members in Arkansas and lowa,

concluding that the running of the 60-day period had been

tolled by the filing of separate class actions in those States

(Pet. App. 50a & n.1, 51a-52a). See pages II-III, supra.

In an order dated April 27, 1984, the district court

rejected the Secretary’s contention that the class

could not include any persons who had not exhausted

their administrative remedies, as required by 42

U.S.C. 495(g). The court reasoned that judicial

“waiver” of this requirement was appropriate be-

cause, in its view, members of the class otherwise

would suffer irreparable harm and it would be “futile

and inefficient” to require exhaustion (Pet. App. 49a).

The court also concluded that it could exercise man-

damus jurisdiction under 28 U.S.C. 1361 (7bid.).

The district court then entered a sweeping “pre-

liminary injunction” that directed the Secretary: (i)

to notify all new-applicant class members who then

had administrative appeals pending that they were

entitled to have their claims considered under what

the court defined as the “proper” pain standard, to

submit additional evidence under that standard, to

receive an expedited decision within 60 or 90 days,

and to receive interim benefits if a decision was not

rendered within the applicable time period; (ii) to

notify all class members whose applications had been

denied and who did not have a timely appeal pend-

ing that they were entitled to have their claims re-

opened and readjudicated under the same conditions;

and (iii) to reopen the claims of all class members

in the latter category whose files were still located

at an SSA district office or ‘Appeals Council, whether

or not the individual claimant requested reopening

(Pet. App. 75a-77a, 80a). The court ordered similar

injunctive relief as regards class members whose

benefits had been terminated, requiring the Secretary,

inter alia, to notify class members that they could

have their claims reopened and reconsidered under

what the court determined to be the “proper” pain

standard and under an appropriate “medical im-

provement” standard for determining when a recip-

ient’s disability has ceased (id. at 73a-75a, 79a-80a).

3. The Secretary appealed the district court’s or-

cer entering the preliminary injunction.’ Because the

Secretary argued on appeal that she had been apply-

ing standards for the evaluation of pain that were

consistent with Eighth Circuit precedent, the court

of appeals deferred its decision in order to allow the

parties an opportunity to reach agreement on the

appropriate standards (Pet. App. 28a). The parties

thereafter did reach agreement (7d. at 29a-30a), and

by order dated July 17, 1984 (id. at 27a-31la), the

court of appeals approved that agreement as a cor-

rect restatement of Eighth Circuit precedent on the

subject.°

4. The court of appeals issued its decision on the

‘remaining issues in the case on December 31, 1984

5 The court of appeals granted a stay pending appeal (Pet.

App. 28a).

6 The agreement stated that symptoms, such as pain, are

the individual’s own perceptions of the effects of his impair-

ment and that such symptoms must be considered in terms of

any restrictions they impose beyond those demonstrated by

objective physical manifestations (Pet. App. 29a). The agree-

ment further stated that direct medical evidence of the rela

tionship between the impairment and the degree of a claim-

ant’s subjective complaints need not be produced and that the

adjudicator may not disregard a claimant’s subjective com-

plaints solely because the objective medical evidence does not

fully support them (id. at 29a-30a). The agreement concluded

that the absence of an objective medical basis to support the

severity of the complaints alleged is just one factor to be

considered in evaluating the credibility of the testimony and

complaints, and that the adjudicator must give full considera-

tion to all of the evidence, including the claimant’s prior work

record, his daily activities, the frequency and intensity of the

pain, precipitating and aggravating factors, the effects of

medication, and resulting functional restrictions (id. at 30a).

(Pet. App. la-26a). In the meantime, Congress had

enacted the Social Security Disability Benefits Reform

Act of 1984 (Pub. L. No. 98-460, 98 Stat. 1794),

which had a direct bearing on both the “medical

improvement” and “pain” issues.

a. In Section 2 of the 1984 Act (98 Stat. 1794),

Congress enacted detailed statutory standards for

determining whether a person’s disability benefits

should be terminated, and it required the cases of

individual class members in certified class actions

raising the “medical improvement” issue to be re-

manded to the Secretary for reconsideration under

the new standards. The court of appeals concluded

that ail of the class members in the instant case who

previously had been receiving benefits but whose ben-

efits were terminated were covered by the special

remand provisions of the 1984 Act, and it therefore

remanded the cases of these class members to the

Secretary for consideration under Section 2 of the

1984 Act (Pet. App. 5a-i0a). This disposition was

consistent with this Court’s similar remand orders in

Heckler v. Lopez, No. 84-115 (Dec. 10, 1984), and

Heckler v. Kuehner, No. 88-1593 (Nov. 5, 1984).’

The individual case of respondent Polaski, the class

representative, was covered by the remand provisions

of the 1984 Act.

b. There remained, then, the question of the proper °

disposition of the claims of the class members who

had not previously been receiving disability benefits

‘As the court of appeals held (Pet. App. 18a), any of

these terminated class members are entitled to raise the ‘‘pain”

issue in the course of the administrative reconsideration of

their claims. See the Supplemental Brief (at 9 n.9) filed on

behalf of the Secretary on October 23, 1984 in Heckler v.

Kuehner, supra.

and who therefore were not covered by the special

remand provisions in Section 2 of the 1984 Act. As

to these class members (the new applicants), the in-

stant case raised only the “pain’’ issue.

In Section 3 of the 1984 Act (98 Stat. 1799 (Pet.

App. 87a-89a)), Congress enacted new statutory

standards for the consideration of pain. The Secre-

tary argued (Supp. Br. 18-15; Supp. Reply Br. 10-11)

that Section 3 of the 1984 Act superseded prior law

and that she should be permitted to interpret and

apply the new statutory “pain” provisicns in the first

instance, either by regulation or in the course of the

administrative adjudication of claims presenting that

issue. Nevertheless, the court of appeals chose to

reach the question of the meaning of Section 3 of

the 1984 Act and concluded that it did not affect the

July 17, 1984 settlement agreement between the

parties because, in the court’s view, the 1984 Act

did net depart from prior law embodied in that agree-

ment (Pet. App. 16a-17a).

The majority, over Judge Gibson’s dissent (Pet.

App. 25a-26), also rejected the Secretary’ contention

that the court in any event had no jurisdiction to

resolve the “pain” issue because the new-applicant

class members had not exhausted their administrative

remedies, as required by 42 U.S.C. 405(g) (Pet. App.

18a-25a). Following the Second Circuit’s reasoning

in City of New York v. Heckler, 742 F.2d 729 (1984),

petition for cert. pending, No. 84-1923 (see Pet. App.

20a, 28a), the court of appeals held that judicial

“waiver” of the exhaustion requirement was appro-

priate under what it termed a “pragmatic analysis”

of “the claimants’ interest in judicial review at that

point in the proceedings” and “the relative harm to

the agency’s administrative process” (id. at 20a).

The court of appeals relied on a number of fac-

tors. First, it believed that the class members would

suffer “potentially irreparable harm” because a de-

nial of benefits could result in financial hardship and

cause them to become anxious, depressed, or despair-

ing (Pet. App. 20a-21a). Second, the court reasoned

that deference to the Secretary’s judgment that full

exhaustion is required was “inappropriate” because

respondents concended the administrative adjudicators

at every level had evaluated complaints of pain un-

der an improper standard and because the Secretary

acknowledged that “some adjudicators” had misin-

terpreted her policies (id. at 2la-22a). Third, the

court believed chat it would be “unfair” not to require

reopening of the claims of class members that had

been denied prior to July 17, 1984, because claims

considered after that date would be decided under

the proper standard embodied in the settlement agree-

ment (id. at 22a-23a). Fourth, the court believed

that deference to the agzency’s expertise was “un-

necessary and inappropriate’ because the parties’

stipulation on pain and the 1984 Act had resolved

the controversy over the pain standard (id. at 23a).

Fifth, although the court conceded that the legal issue

concerning the evaluation of pain, unlike the issue in

Mathews yv. Eldridge, 424 U.S. at 330, was nat

“wholly collateral’ to the class members’ claims for -

benefits, the court believed it was sufficient that the

“focus” of the argument on behalf of the class was

“substantially” collateral to their claims for benefits

(Pet. App. 23a).*

8 The court of appeals directed the Secretary to send a notice

to the new-applicant class members informing them of their

right to request reopening, but eliminated the district court’s

requirements that readjudication be accomplished within fixed

ce. The Secretary’s petition for rehearing en banc

on the exhaustion issue was denied, with three judges

dissenting (Pet. App. 84a).

REASONS FOR GRANTING THE PETITION

The decision of the court of appeals dispensing

with the exhaustion prerequisite to jurisdiction un-

der 42 U.S.C. 405(g) is flatly inconsistent with this

Court’s decisions in Weinberger v. Salfi, 422 U.S.

749 (1975); Mathews v. Eldridge, 424 U.S. 319

(1976); and Heckler v. Ringer, No. 82-1772 (May

14, 1984). The court’s ruling on the exhaustion issue

also directly conflicts with the decision of the Fourth

Circuit in an identical class actior. challenging the

manner in which pain is considered. Wyatt v. Heck-

ler, 757 F.2d 1455, 1460 (1985). The vesult of the

decision below is to require reopening of acministra-

tive decisions throughout the Eighth Circuit that

the claimants involved allowed to become final and

binding when they failed to seek further administra-

tive review within the 60 days permitted by govern-

ing regulations. The Department of Health and

Human Services estimates that there are approxi-

mately 9,000 such cases. The decision below there-

fore plainly warrants review by this Court.

The exhaustion issue in this case is similar to that

presented in Heckler v. City of New York, petition

for cert. pending, No. 84-1923, in which the Court

recently granted a partial stay pending certiorari.

No. A-972 (July 1, 1985). Related exhaustion issues

also are presented in the Secretary’s direct appeal in

Heckler v. Owens, appeal docketed, No. 84-1905

deadlines and that the Secretary pay interim benefits to class

members whose claims were not readjudicated within this

period (Pet. App. 24a-25a).

(June 5, 1985). We do not believe it is necessary for

the Court to grant plenary review here as well. In-

stead, we suggest that the Court hold the petition in

this case pending its disposition or decision in City

of New York and Owens. We therefore refer the

Court to the discussion of the exhaustion requirement

in the certiorari petition (at 16-23) in City of New

York and add the following observations:

1. In the petition (at 20-22) in City of New York,

we explain that where, as here, the Secretary has not

waived full exhaustion of administrative remedies,

the Court has recognized only one exception to the

exhaustion requirement. That exception applies

where the legal issue the claimant raises is “entirely”

or “wholly” collateral to the merits of his substantive

claim for benefits and he has advanced a colorable

argument that he will suffer irreparable injury if

judicial review is not immediately available. Mathews

v. Eldridge, 424 U.S. at 330-332; Heckler v. Ringer,

slip op. 14-15. That lone exception plainly has no

application here. The court of appeals conceded that

the legal issue respondents raise concerning the eval-

uation of pain, unlike the asserted right to a pre-

termination hearing in Eldridge, is not “wholly col-

lateral’ to the merits of the class members’ claims

for benefits (Pet. App. 23a); to the contrary, that

issue goes to the very heart of their entitlement to-

benefits under the statutory definition of “disability”

and implementing regulations. Nor have respondents

identified any distinct and irreparable injury that

might result from the Secretary’s allegedly erroneous

evaluation of pain. They allege only the sorts of

hardship any claimant for disability benefits might

suffer if his application is denied on the merits at a

preliminary stage of the administrative review pro-

—————— eS”

cess. That obviously is not a basis for dispensing

with the “final decision” requirement in 42 U.S.C.

405(g). Indeed, the single class representative, re-

spondent Polaski, did exhaust her administrative rem-

edies and obtain the requisite final decision of the

Secretary before seeking judicial review. See also

note 3, supra. There is no reason why the unnamed

class members should be excused from doing the

same.

2. The error of the court of appeals in the in-

stant case is, in one respect, more egregious than

that of the Second Circuit in City of New York. The

court below endorsed the Secretary’s overall approach

to the evaluation of complaints of pain, as reflected

in the settlement agreement the court approved on

July 17, 1984. As a result, there was no reason to

assume that a significant percentage of disability

claims based on allegations of pain had been decided

incorrectly; rather, there were, at most, only occa-

sional misapplications of the Secretary’s concededly

proper approach in an unspecified number of ad-

ministrative decisions affecting particular individual

claimants. Such isolated errors are precisely the sort

that should be left to correction by the Secretary

in further administrative proceedings on the particu-

lar claims involved. Salfi, 422 U.S. at 765-766;

Ringer, slip op. 14-16. Yet the court of appeals has

required the Secretary to provide for the readjudica-

tion of all administrative decisions in the Eighth

Circuit during the relevant time period in which the

applicant alleged disabling pain and the application

was denied on medical or medical vocational grounds

(Pet. App. 51a).

3. Another objectionable result of the erroneous

exhaustion holding in this case is that the court of

appeals proceeded to render a decision regarding the

interpretation of a statutory provision—Section 3

of the 1984 Disability Benefits Reform Act—before

the Secretary even was given an opportunity to inter-

pret and apply that statutory provision in the first

instance, either by regulation or by the administra-

tive adjudication of particular claims for benefits in

which the pain issue was raised. If the court below

had respected the controlling precedents of this Court

on the exhaustion issue, it instead would have re-

manded the case to the district court with instruc-

tions to dismiss for lack of jurisdiction as regards

the new-applicant class members, without reaching

the legal issue concerning the evaluation of pain.’

The correct interpretation of the newly enacted stat-

utory provision then could have been resolved at a

later date on judicial review under 42 U.S.C. 405(g)

of the Secretary’s “final decision” denying a class

member’s claim for benefits, if the pain issue ulti-

mately proved to have any bearing on the Secretary’s

resolution of that claim.

® The court of appeals could not have resolved that issue in

the context of the claims of the two named respondents, since

Blaschko’s individual case already had been remanded and

Polaski’s case was required to be remanded under Section 2

of the 1984 Act without reaching the merits of the pain issue.

See note 7, supra; Heckler v. Kuehner, supra. The court of

appeals acknowledged that the unnamed members of the class

had not exhausted their administrative remedies (Pet. App.

19a).

CONCLUSION

The petition for a writ of certiorari should be held

and disposed of in light of the Court’s disposition in

Heckler vy. City of New York, No. 84-1923, and

Heckler v. Owens, No. 84-1905. If the Court grants

the petition for a writ of certiorari in this case and

remands for further consideration in light of those

cases, it should vacate the judgment below except

insofar as it addresses the cases of the terminated

class members under Section 2 of the Social Security

Disability Benefits Reform Act of 1984.

Respectfully submitted.