Opposition Brief — Hollins v. Barnhart

No. 02-1489

Jn the Supreme Court of the Gnited States

LINDA HOLLINS, PETITIONER

Vv.

JO ANNE B. BARNHART,

COMMISSIONER OF SOCIAL SECURITY

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

BRIEF FOR THE RESPONDENT IN OPPOSITION

THEODORE B. OLSON

Solicitor General

Counsel of Record

ROBERT D. MCCALLUM, JR.

Assistant Attorney General

WILLIAM KANTER

MICHAEL E. ROBINSON

Attorneys

Department of Justice

Washington, D.C. 20530-0001

(202) 514-2217

QUESTION PRESENTED

Whether, after a district court remands a Social

Security disability case to the Commissioner of Social

Security pursuant to sentence four of 42 U.S.C. 405(g),

an Administrative Law Judge (ALJ) is limited to de-

ciding only the specific issues identified by the district

court’s decision, or whether the ALJ may reconsider

other issues where doing so is not inconsistent with the

district court’s judgment.

(1)

TABLE OF CONTENTS

Page

Opinions below ........ 1

Jurisdiction 1

Statement 2

Argument nine 8

Conclusion 18

TABLE OF AUTHORITIES

Cases:

Bowen v. Yuckert, 482 U.S. 187 (1987) 3

Chrupcala v. Heckler, 829 F.2d 1269 (3d Cir.

1987) 9, 13, 14-15

Clay v. United States, 123 S. Ct. 1072 (2008) ...........sssseee 18

Cleveland v. Policy Mgmt. Sys. Corp., 526 U.S.

795 (1999) 3

FPC v. Idaho Power Co., 344 U.S. 17 (1952) .........scsceseees 11

Federated Dep’t Stores, Inc. v. Moitie, 452 U.S.

394 (1981) 16

Fogel v. Chestnutt, 668 F.3d 100 (2d Cir. 1981),

cert. denied, 459 U.S. 828 (1982) 16

Heckler v. Campbell, 461 U.S. 458 (1988) ........ccccccssseseees 3

Hooper v. Heckler, 752 F.2d 83 (4th Cir. 1985) ............000 16

Horrell v. Chater, 54 F.3d 787 (10th Cir. 1995) ................ 16

INS v. Ventura, 123 S. Ct. 353 (2002) 11

Key v. Sullivan, 925 F.2d 1056 (7th Cir. 1991) ................ 16

Mefford v. Gardner, 383 F.2d 748 (6th Cir. 1967) ............ 9

Port of Portland v. United States, 408 U.S. 811

(1972) 11

Quern v. Jordan, 440 U.S. 332 (1979) 17

Rivet v. Louisiana, 522 U.S. 470 (1998) 16

Ruiz v. Apfel, 24 F. Supp. 2d 1045 (C.D. Cal. 1998) ........ 15

SEC v. Chenery Corp., 332 U.S. 194 (1947) .........000+ 11, 15, 16

(IIT)

IV

Cases—Continued: Page

Semtek Int'l, Inc. v. Lockheed Martin Corp., 531 U.S.

497 (2001) .... 17

Shalala v. Schaefer, 509 U.S. 292 (1993) 18

Sullivan v. Hudson, 490 U.S. 877 (1989) 8,9, 10 -

United States v. Campbell, 168 F.3d 263 (6th Cir.),

cert. denied, 528 U.S. 882 (1992) 10, 11

United States v. Moore, 131 F.3d 595 (6th Cir. ~

1997) - 11

United States v. Washington, 172 F.3d 1116

(9th Cir. 1999) 10

United States v. Young, 66 F.3d 830 (7th Cir.

1995) . 10

Statutes and regulations:

~ Equal Access to Justice Act, 28 U.S.C. 2412 et seq. ......... 10

Social Security Act, Tit. II, 42 U.S.C. 401 et seq. .........0000 2

42 U.S.C. 402(e)(1)(B) 2

42 U.S.C. 402(e)(4) 2

0

2

2

42 U.S.C. 405(g) 1

42 U.S.C. 423(d)(1)(A)

42 U.S.C. 423(d)(2)(A)

20 C.F.R. Pt. 404:

Subpt. J:

OI GGT itadicersceniciinennicninianientnitieninnieieninin 14, 15

Section 404.983 10, 14, 15

Subpt. P:

Section 404.1520(a)

Section 404.1520(b)

Section 404.1520(c)

Section 404.1520(d)

Section 404.1520(f)

App. 1 . ”

Listing 12.05C 4, 5, 12,1

3

3

3

3

Section 404.1520(e) 4

4

3

3

Miscellaneous: Page

OS FOG, Oe: BTU I itive 10, 14

a

oe

In the Supreme Court of the Gnited States

No. 02-1489

LINDA HOLLINS, PETITIONER

Vv.

Jo ANNE B. BARNHART,

COMMISSIONER OF SOCIAL SECURITY

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

BRIEF FOR THE RESPONDENT IN OPPOSITION

OPINIONS BELOW

The opinion of the court of appeals (Pet. App. 3a-15a)

is unreported. The opinion of the district court (Pet.

App. 16a-30a) is reported at 160 F’. Supp. 2d 834. A

previous opinion of the district court remanding the

ease to the Commissioner (Pet. App. 75a-78a) is unre-

ported.

JURISDICTION

The judgment of the court of appeals was entered on

Octoher 17, 2002. A petition for rehearing was denied

on January 10, 2008. The petition for a writ of certio-

rari was filed on April 7, 2003. The jurisdiction of this

Court is invoked under 28 U.S.C. 1254(1).

(1)

2

STATEMENT

1. Title II of the Social Security Act, 42 U.S.C. 401 et

seq., provides disability insurance benefits to covered

workers and, in certain circumstances, te the disabled

widows and widowers 01 covered workers. The Act

defines “disability” 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 ir 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). An indi-

vidual may be found to be under a disability, moreover,

“only if his physical or mental impairment or impair-

ments are of such severity that he is not only unable to

do his previous work but cannot, considering his age,

education, and work experience, engage in any other

kind of substantial gainful work-which exists in the

national economy.” 42 U.S.C. 423(d)(2)(A). To qualify

for widow’s insurance benefits, a claimant must estab-

lish that she became disabled sometime between her

50th birthday and the seventh year following the death

of her spouse. 42 U.S.C. 402(e)(1)(B), 402(e)(4).

Petitioner filed a claim for benefits as the disabled

widow of a covered worker. Her claim was denied

initially and on reconsideration. Pet. App. 96a. Peti-

tioner then sought a hearing before an Administrative

Law Judge (ALJ), who conducted the hearing in April,

1996. Ibid. The ALJ determined that petitioner had

several physical impairments and limited intellectual

functioning. Jd. at 108a. Nonetheless, the ALJ deter-

mined that petitioner was not disabled. Petitioner’s

residual functional capacity, the ALJ found, permitted

her to perform a significant number of light jobs. Id. at

106a-107a, 110a; see id. at 4a, 19a. The ALJ concluded

3

that petitioner’s “capacity for light work has not been

significantly compromised by the functional limitations

imposed by her impairments.” Jd. at 107a.

Petitioner sought review in district court, arguing

that the ALJ’s determination was not supported by

substantial evidence. Specifically, petitioner argued

that she should have been found disabled based on the

Social Security Administration’s “Listing of Impair-

ments.” See 20 C.F.R. Pt. 404, Subpt. P, App. 1. The

Listings identify impairments that are presumed to be

So severe as to preclude all gainful activity. If a claim-

ant has a listed impairment (and is not currently

engaged in substantial gainful activity), the claimant

generally will be found disabled without further in-

quiry. 20 C.F.R. 404.1520(d).! If the claimant’s impair-

ments do not meet the Listing requirements, however,

the ALJ will evaluate her “residual functional capacity”

and decide whether she can perform her former work

or any other work. Such a claimant will be found

disabled only if (a) she is functionally incapable, because

1 The Listings are employed at step three of the five-step se-

quential evaluation process the Commissioner uses to decide dis-

ability claims. See Heckler v. Campbell, 461 U.S. 458, 460-461

(1983); Cleveland v. Policy Mgmt. Sys. Corp., 526 U.S. 795, 804

(1999); Bowen v. Yuckert, 482 U.S. 187, 147-148 (1987). Under that

process, a claimant can be found disabled or not disabled at various

points. If that occurs, the evaluation does not proceed further. 20

C.F.R. 404.1520(a). At step one, the Commissioner asks whether

the claimant is currently engaging in substantial gainful activity; if

the claimant is, she is not disabled. 20 C.F.R. 404.1520(b). At step

two, the Commissioner asks whether the claimant has a severe

impairment, or combination of impairments, “which significantly

limits” her “ability to do basic work activities,” such as lifting,

standing, and walking, 20 C.F.R. 404.1520(c); if the impairment or

impairments are not so severe as to significantly limit such activi-

ties, the claimant is not disabled. Jbid.

eee eas

4

of her impairment or combination of impairments, of

performing the kind of work she has done in the past,

and (b) she cannot perform any other work in the

national economy, considering her residual functional

capacity, age, education, and work experience. 20

C.F.R. 404.1520(e), 404.1520(f).?

In this case, petitioner argued that her combined

physical and mental impairments were equivalent to

the Listing for mental retardation, 20 C.F.R. Pt. 404,

Subpt. P, App. 1, Listing 12.05C. See Pet. App. 4a, 83a.

In addition, petitioner argued that the ALJ should have

found that she was illiterate. Jbid. Adopting the

recommendations of a magistrate judge, id. at 79a-87a,

the district court agreed that the ALJ had not ad-

dressed those issues with sufficient clarity, but declined

to rule that petitioner’s impairments were equivalent to

Listing 12.05C (mental retardation). Pet. App. 75a-76a,

86a; see id. at 4a. Instead, the court remanded the case

to the agency “for further proceedings.” Jd. at 75a.

2. On remand, the ALJ reconsidered the specific

issues identified by the district court, taking new evi-

dence and conducting a new hearing. The ALJ ex-

plained that, following a psychological examination, Dr.

West had reported that petitioner’s IQ test scores

ranged from 68 to 79. Pet. App. 45a. However, Dr.

West concluded that those scores were “invalid due to

low effort, interest, and motivation on [petitioner’s]

part.” Jbid. In addition, Dr. West found “no indication

2 The inquiry into whether the claimant can do her former work

is step four of the five-step sequential evaluation process. 20

C.F.R. 404.1520(e). The inquiry into whether the impairment

prevents the claimant “from doing any other work,” considering

her residual functional capacity, age, education, and work ex-

perience, is step five. 20 C.F.R. 404.1520(f).

‘

nn SRE SEEN TR Nl cy nee nN ER A oe

enema

5

of a formal thought disorder, hallucinations, or delu-

sional thinking.” Jd. at 46a. Although petitioner

suffered from depression, Dr. West stated that peti-

tioner “would be able to relate appropriately with

fellow workers and supervisors,” could follow simple

instructions, and could maintain adequate concentration

to accomplish assigned tasks. Ibid. Dr. West con-

cluded: “The findings indicate that [petitioner] would

have minimal impairment in being able to deal with day

to day work activity, given her current cognitive and

psychological functioning.” Ibid.

To determine whether petitioner’s impairments

“equalled” the Listing for mental retardation, Listing

12.05C, the ALJ also obtained the “medical expert

opinion” of Dr. Serednesky. Pet. App. 47a. Dr.

Serednesky reported that petitioner did not meet the

Listing for mental retardation because “the subtest

scatter between * * * IQ testing contained in the

record * * * demonstrated malingering, the IQ scores

conflicted with memory testing, and [petitioner] put

forth no effort during the testing.” Jbid. Dr. Sered-

nesky also stated that “the record contained no data

that would suggest medical equivalence to any Listing.”

Ibid. The ALJ therefore determined that petitioner did

not meet Listing 12.05C. Pet. App. 56a-57a, 62a.

The ALJ further determined, however, that he had

erred in his previous evaluation of petitioner’s physical

impairments. In particular, the ALJ concluded that

petitioner did not have any severe physical impair-

ments and that her non-exertional (e.g., mental) impair-

ments did not preclude substantial gainful activity. The

ALJ explained that his earlier (pre-remand) finding

that plaintiff could perform only a reduced range of

light work was incorrect because it was based not on

medical evidence but rather “on plaintiff’s age and

6 —_

general deconditioning,” which are irrelevant to the

determination of residual functional capacity. Pet. App.

48a, 49a; see id. at 102a. Examining the medical evi-

dence in the record, the ALJ found that “the evidence

documented no severe nerve or muscle damage which

might cause significant weakness or limited move-

ment.” Id. at 52a-538a. The ALJ continued:

The evidence of record documents no bony changes,

muscle atrophy or weakness, or reflex or sensory

changes. Accordingly, as there is no objective evi-

dence of a significant physical impairment, and

[petitioner] has refused to cooperate in an assess-

ment of her physical condition, a “severe” physical

impairment cannot be found.

Id. at 58a.2 Relying on the testimony of a vocational

expert, the ALJ concluded that there was a range of

jobs that someone with petitioner’s residual functional

capacity could perform. Id. at 59a-6la. The ALJ there-

fore found that petitioner was not disabled. Jd. at 64a.

3. Petitioner again sought review in district court.

This time, petitioner argued that the ALJ was bound

by the earlier determination that she did have severe

physical impairments that greatly restricted the range

of work she can do. Pet. App. 25a-26a; see id. at 5a.

The district court disagreed, concluding that the earlier

decision of the ALJ was no longer binding, because

petitioner had sought judicial review and the court had

entered an order reversing and remanding. Id. at 27a;

see id. at 5a.

3’ The ALJ had determined that a formal orthopedic evaluation

was necessary. Pet. App. 49a. Petitioner, however, declined to

participate in the evaluation based on the advice of counsel. Jd. at

49a, 52a.

7

Petitioner also argued that the district court’s initial

decision established the law of the case regarding her

physical capacity; in the alternative, she relied on issue

preclusion. Pet. App. 27a. The district court rejected

those arguments. Petitioner, the district court ob-

served, could not rely on res judicata principles because

critical requirements for issue preclusion—a final judg-

ment on the merits and resolution of the specific issues

as a “necessary” or “essential” component of that

judgment—were absent. See id. at 27a-28a.

4. The court of appeals affirmed in an unpublished

decision. Pet. App. 3a-15a. Before the court of appeals,

petitioner did not argue that the ALJ was bound by his

own earlier determination that petitioner had severe

physical impairments. Jd. at 5a. Instead, relying on the

district court’s earlier decision remanding the case,

petitioner argued that reconsideration was barred by

the law-of-the-case doctrine or res judicata (claim and

- issue preclusion). Ibid. The court of appeals rejected

those arguments, explaining that a district court ruling

is preclusive with respect to claims and issues only if

there is a final judgment on the merits, and that issue

preclusion applies only as to an issue “actually litigated

and decided in the prior action” and only if “resolution

of the issue was necessary and essential to a judgment

on the merits.” Jd. at 5a-6a (citation omitted).

In this case, the court of appeals found that the

district court’s initial decision “did not constitute a

decision on the merits regarding [petitioner’s] residual

functional capacity.” Pet. App. 6a. To the contrary, the

court explained, the decision addressed only “the two

narrow errors committed by the ALJ in the initial

hearing.” Ibid. “The merit of the ALJ’s determination

regarding [petitioner’s] physical capacity,” the court

continued, was merely “assumed” but not decided.

8

“The fact that the ALJ made certain factual findings”

may have been important, the court explained, “but the

truth of those findings” was not at issue. Jbid.

The court of appeals also rejected petitioner’s argu-

ment that the ALJ had exceeded the scope of the

district court’s initial remand order. The court agreed

that an agency may not deviate from the court’s

remand order in later administrative proceedings. Pet.

App. 7a (citing Sullivan v. Hudson, 490 U.S. 877, 886

(1989)). But the court of appeals held that that limit

“do[es] not preclude the ALJ from acting in ways that

go-beyond, but are not inconsistent with, the district

court’s opinion.” Jbid. In this case, the court concluded

that “(rjeconsideration of [petitioner’s] physical impair-

ments was not inconsistent with any express or implied

order of the district court.” Jd. at 7a-8a.

The court of appeals also observed that the ALJ did

not need a mandate from a federal court to consider the

extent of petitioner’s physical impairments, because the

power to do so derives from the legislative grant of

authority contained in the Social Security Act. The

court noted that the Social Security Administration has

promulgated a regulation informing claimants that,

upon remand by a federal court, “any issues relating to

your claim may be considered by the administrative law

judge whether or not they were raised in the admini-

strative proceedings leading to the final decision in your

case.” Pet. App. 8a (quoting 20 C.F.R. 404.983). The

court held that “(t]he ALJ therefore did not act outside

his authority” in examining petitioner’s “physical capa-

city.” Ibid. :

ARGUMENT

The decision of the court of appeals is correct and

does not conflict with any decision of this Court or any

SR ennnen enone REPRISE pins rn ¥ ene rn OH ETO SMES lin] 8e NaN Gg OestSere UBT LeSV LICR Shai OE Tn Sts aa Tee ca a

FERRER == SS

9

other court of appeals. Further review therefore is not

warranted.

1. Petitioner argues (Pet. 10) that the court of

appeals’ unpublished decision is inconsistent with this

Court’s decision in Sullivan v. Hudson, 490 U.S. 877,

886 (1984), and conflicts with Chrupcala v. Heckler, 829

F.2d 1269 (3d Cir. 1987). According to petitioner,

“CwJhere a remand order expressly states the terms of-

the remand, then neither the Appeals Council nor

the ALJ may revisit previous determinations on other

issues.” Pet: 10. Petitioner argues that “the original

remand order” in this case “was for such a limited,

specific purpose,” and therefore foreclosed recon-

sideration of issues “beyond the scope of [that] order.”

Ibid. Those arguments lack merit.

a. In Hudson, this Court observed that “the district

court’s remand order will often include detailed instruc-

tions concerning the scope of remand, the evidence to

be adduced, and the legal or factual issues to be

addressed.” 490 U.S. at 885. In those circumstances,

the Court noted, “[dJeviation from the court’s remand

order in the subsequent administrative proceedings is

itself legal error, subject to reversal on further judicial

review.” Id. at 886; see also Mefford v. Gardner, 383

F.2d 748, 758 (6th Cir. 1967) (noting “the general rule

that, on the remand of a case after appeal, it is the duty i

of the lower court, or the agency from which appeal is

taken, to comply with the mandate of the court and to

obey the directions therein without variation and with-

out departing from such directions”). As the court of

appeals explained in this case, however, Hudson did not

address the extent to which an ALJ might consider

issues “that go beyond, but are not inconsistent with,

the district court’s opinion.” Pet. App. 7a.

10

Indeed, Hudson did not involve any issue concerning

the limits on an ALJ’s authority after a remand; rather,

the issue in Hudson was whether the Equal Access

to Justice Act, 28 U.S.C. 2412 et seq., entitles a Social

Security claimant to attorney’s fees for representation

in administrative proceedings before the agency

following a district court remand. 490 U.S. at 879.

Hudson thus had no reason to address, and did not

address, the effect of the Commissioner’s regulations,

including 20 C.F.R. 404.983, which provides that, after

“a Federal court remands a case to the Commissioner

for further consideration,” any “issues relating to your

claim may be considered by the administrative law

judge whether or not they were raised in the admini-

strative proceedings leading to the final decision in your

case.” |

In any event, remands (whether to a lower court or

an administrative agency) generally can be categorized

either as “limited” or “general” in scope. See, ¢.g.,

United States v. Washington, 172 F.3d 1116, 1118 (9th

Cir. 1999); United States v. Campbell, 168 F.3d 263, 265

(6th Cir.), cert. denied, 528 U.S. 882 (1999); United

States v. Young, 66 F.3d 830, 835 (7th Cir. 1995).

“Limited remands explicitly outline the issues to be

addressed by the [lower] court and create a narrow

framework within which the [lower] court must

operate. * * * General remands, in contrast, give

[lower] courts authority to address all matters as long

4 Petitioner mistakenly argues that 20 C.F.R. 404.983 “does not

apply to sentence four remands under 42 U.S.C. § 405(g),” the type

of remand at issue here. Pet. 12. Petitioner identifies no support

for such a conclusion, and nothing in the language of the regulation

limits Section 404.983 to sentence six remands. See 54 Fed. Reg.

37,789 (1989). If the agency had wanted to limit the regulation to

sentence six remands, it certainly could have done so.

11

as remaining consistent with the remand.” Campbell,

168 F.3d at 265 (citation omitted). It is generally under-

stood that, “[{iJn the absence of an explicit limitation, [a]

remand order is presumptively a general one.” Jd. at

268 (quoting United States v. Moore, 131 F.3d 595, 598

(6th Cir. 1997)).

That presumption has special force in the context of

judicial review of agency action, for “the function of the

reviewing court ends when an error of law is laid bare.

At that point the matter once more goes to the [agency]

for reconsideration.” F'PC v. Idaho Power Co., 344 U.S.

17, 20 (1952). The reviewing court’s role, in other

words, “is limited to considering whether the announ-

ced grounds for the agency decision comport with the

applicable legal principles,” Port of Portland v. United

States, 408 U.S. 811, 842 (1972), not to limit the agency’s

authority to re-examine the case (perhaps through the

receipt of new evidence) and identify other grounds for

decision. See INS v. Ventura, 123 S. Ct. 353, 356 (2002).

Indeed, in SEC v. Chenery Corp., 332 U.S. 194 (1947),

this Court rejected the contrary view, upholding an

agency decision that, following the Court’s remand,

reaffirmed the agency’s initial decision on new grounds.

See id. at 200-201. “After the remand was made,” the

Court explained, “the [agency] was bound to deal with

the problem afresh, performing the function delegated

to it by Congress. * * * Only in that way could the

legislative policies embodied in the Act be effectuated.”

Id. at 201. General remands, moreover, are particularly

appropriate in disability cases such as this one, because

disability determinations turn on numerous variables,

some of which change with the passage of time. To

construe remand orders with undue rigidity would in

many cases prejudice claimants—particularly those

12

with progressive diseases—by precluding consideration

of additional evidence supporting their disability claims.

In this case, petitioner’s argument rests on the mis-

taken premise that the district court’s initial remand

order was “limited” to the specific issues discussed in

the district court’s opinion. While the district court

remanded the case to permit the agency to give further

consideration to the equivalency issue—+.e., petitioner’s

contention that her impairments should be considered

the equivalent of the impairment described in Listing

12.05(C)—and petitioner’s claim that she was illiterate,

see Pet. App. 84a-86a, neither the magistrate judge’s

Report and Recommendation, nor the district _court’s

order adopting that Report and Recommendation, con-

tained detailed or specific instructions regarding the

scope of the remand, the evidence to be adduced on

remand, or limitations on the legal or factual issues that

the ALJ could address. Instead, both simply concluded

that the case should be remanded “for further pro-

ceedings pursuant to 42 U.S.C. § 405(g), sentence four.”

See Pet. App. 75a-76a, 86a.

Thus, as the court of appeals explained, “[rJecon-

sideration of [petitioner]’s physical impairments was

not inconsistent with any express or implied order of

the district court.” Pet. App. 7a-8a. In any event,

whether or not the particular district court judgment at

issue here contained language expressly or impliedly

foreclosing the ALJ’s consideration of a given matter is

a highly fact-bound issue that does not warrant this

Court’s review. In fact, further review is especially

unwarranted because resolution of that issue turns in

the first instance on the district court’s interpretation

of its own prior judgment in the case, based on its

familiarity with the prior and current proceedings, and

the court of appeals sustained the district court’s ruling.

13

_The issues addressed by the ALJ on remand, more-

over, were within the scope of the remand order even as

petitioner would narrowly construe it. That order

directed reconsideration of whether petitioner met the

Listing for mental retardation, Listing 12.05C. Listing.

12.05(C) provides that an individual will be presumed

disabled if: (1) her IQ is between 60 and 70; (2) she has

another physical or mental impairment that imposes

“an additional and significant work-related limitation of

function”; and (3) her mental deficiency manifested

before age 22. 20 C.F.R. Pt. 404, Subpt. P, App. 1,

Listing 12.05C. Thus, in applying that Listing, the ALJ

was permitted to examine not only petitioner’s IQ but

also her other physical and mental impairments, and to

determine whether they impose “significant work-

related limitation[s].” Nothing in the district court’s re-

mand order required that the ALJ, after having done

so, ignore the resulting findings insofar as they relate to

other disability issues (e.g., ability to perform jobs in

the national economy).

b. Contrary to petitioner’s claims, the decision below

does not conflict with the Third Circuit’s decision in

Chrupcala v. Heckler, supra, decided more than 15

years ago. In Chrupcala, the ALJ determined that the

claimant had been disabled for a year and a half and

awarded benefits for that period. Because the ALJ

determined that the disability had ceased, however, he

also denied the claim for continued benefits. The

claimant sought judicial review of the determination

that his disability had ended, and the district court

remanded the case for a further administrative hearing.

On remand, the ALJ determined that the claimant was

not entitled to any period of disability. 829 F.2d at

1270-1271. Reversing, the court of appeals held that

the ALJ lacked authority to examine issues on remand

14

other than those that were actually raised by the

claimant in his civil action in district court. The court

concluded that, absent adequate notice, the claimant

had no reason to question the finality of the portion of

the agency decision finding him disabled for a certain

period of time, which was favorable to the claimant and

therefore not subject to judicial review on the prior

occassion. See id. at 1270, 1273-1274.

The court rested its decision in significant part, how-

ever, on the fact that the agency’s regulations regard-

ing remands at that time “provide[d] no clear guidance

as to the scope of issues that may be reviewed when the

district court remands a case to the Secretary.” 829

F.2d at 1272 (discussing 20 C.F.R. 404.983 and 404.977

(1986)). After Chrupcala was decided, the agency

amended its regulations to provide explicit guidance as

to the scope of issues that may be reviewed by the

agency following a remand. Thus, 20 C.F.R. 404.983

now states that, when a federal court remands a case to

the Commissioner for further consideration, “[a]ny

issues relating to [the claimant’s] claim may be

considered by the administrative law judge whether or

not they were raised in the administrative proceedings

leading to the final decision in [the] case.” See 54 Fed.

Reg. 37,791 (1989). In light of that amendment, it is

doubtful that the Third Circuit would consider Chrup-

cala binding precedent today.

Chrupcala, moreover, involved action on remand

quite different from the actions at issue here. In

Chrupcala, the ALJ did not merely reach the same

result on remand—a denial of benefits—based on new

evidence and additional reasoning. Instead, the ALJ in

Chrupcala reached a new result that took away an

award of benefits that the agency had previously

_ granted and that had not been at issue on appeal. 829

15

F.2d at 1271. Whatever Chrupcala’s current vitality,

there is no reason to believe that the Third Circuit

would extend the decision beyond that distinct context

so as to preclude an ALJ from invoking alternative

grounds to reaffirm the results of the ALJ’s initial

decision. See Chenery, 332 U.S. at 200-201; pp. 11-12,

supra.

5 Petitioner also contends (Pet. 10-11) that the decision below

conflicts with Ruiz v. Apfel, 24 F. Supp. 2d 1045 (C.D. Cal. 1998).

Because Ruiz is a district court decision, it does not implicate a

circuit conflict. Ruiz is, in any event, distinguishable. In that case,

the district court remanded the case to permit the ALJ to make

complete credibility findings. Jd. at 1050. On appeal from the re-

mand decision, the district court relied on Chrupcala to hold that

the ALJ had erred in going beyond that remand and re-deciding an

issue that had previously been decided in the claimant’s favor (and

that, as a result, had not previously been addressed on judicial

review). Ibid. The court recognized, however, that “(rjegulations

promulgated after Chrupcala appear to conflict with its holding to

some extent, in that they authorize the ALJ, in a case remanded by

a federal court, to examine ‘{aJny issues relating to your claim . . .

whether or not they were raised in the administrative proceedings

leading to the final decision in your case.’” Jd. at 1050-1051 n.7

(quoting 20 C.F.R. 404.983). The district court therefore also

relied on the fact that the order of the Social Security Admini-

stration Appeals Council in that case—which remanded the case to

the ALJ—could not “reasonably be construed to authorize a

review” of the additional issues given the “very specific and limited

* * * scope” of the district court’s remand order. Ibid. The

district court therefore held that the ALJ’s actions violated the

Social Security Administration’s rule that an ALJ must “follow the

Appeals Council’s remand order ‘and may not take any additional

action that is not inconsistent with the Appeals Council’s remand

order.’” Ibid. (quoting 20 C.F.R. 404.983, 404.977). The court also

distinguished remands that, like the one at issue here, “con-

template[] the taking of new evidence and a de novo adjudication

on the merits.” bid.

16

aa

2. Petitioner further contends that, to the extent

that the decision below “allowed relitigation of an issue

that was or could have been litigated” in the prior

proceeding, it conflicts with this Court’s decisions in

Rivet v. Louisiana, 522 U.S. 470 (1998), and Federated

Department Stores, Inc. v. Movtie, 452 U.S. 394 (1981).

Pet. 11. Those cases hold that “‘{a] final judgment on

the merits of an action precludes the parties or their

privies from relitigating issues that were or could have

been raised in that action.” Rivet, 522 U.S. at 476

(quoting Moitie, 452 U.S. at 398). Alternatively, peti-

tioner argues that the decision below conflicts with

other circuit court decisions holding that, under the

“law of the case” doctrine, “[w]Jhen an appellate court

has either expressly or by necessary implication de-

cided an issue, that decision is binding in all later pro-

ceedings in the same case.” Pet. 16 (citing Key v.

Sullivan, 925 F.2d 1056 (7th Cir. 1991); Horrell v.

Chater, 54 F.3d 787 (10th Cir. 1995) (Table); Fogel v.

Chestnutt, 668 F.2d 100, 108 (2d Cir. 1981), cert. denied,

459 U.S. 828 (1982); and Hooper v. Heckler, 752 F.2d 83,

88 (4th Cir. 1985)).

As an initial matter, petitioner does not claim that

the court of appeals’ unpublished decision announces a

new and incorrect standard for deciding claim pre-

clusion, issue preclusion, and law-of-the-case issues.

Instead, petitioner appears to argue that the court of

appeals misapplied those doctrines to the facts of this

case. The fact-bound claim that a court of appeals

misapplied settled law (in an unpublished opinion) does

not warrant this Court’s review.

Petitioner’s arguments are, in any event, unper-

suasive._.As the court of appeals explained, petitioner

cannot prevail under a law-of-the-case or preclusion

theory because the district court did not issue “a final

17

decision on the merits regarding her physical iripair-

ments and residual functional capacity.” Pet. App. 5a-

6a. See Semtek Int'l Inc. v. Lockheed Martin Corp., 531

U.S. 497, 502 (2001) (“a judgment ‘on the merits’ trig-

gers the doctrine of res judicata or claim preclusion”);

Quern v. Jordan, 440 U.S. 332, 347 n.18 (1979) (noting

that the “doctrine of law of the case comes into play

only with respect to issues previously determined”). As

the court of appeals explained:

[The district court’s first opinion] did not constitute

a decision on the merits regarding [petitioner’s]

residual functional capacity. The district court’s

opinion addressed only the two narrow errors com-

mitted by the ALJ in the initial hearing. The merit

of the ALJ’s determination regarding [petitioner’s]

physical capacity was assumed for the purposes of

evaluating [petitioner’s] claims regarding the ALJ’s

treatment of her combined mental and physical

capacity. In other words, the district court held that

given the ALJ’s findings regarding physical capac-

ity, the ALJ should have considered the combined

effect of her mental and physical impairments and

compared that full picture to Listing 12.05C.

Pet. App. 6a.

Construing its own opinion, the district court judge

likewise found no issue preclusion because (a) “neither

party in the earlier action actually litigated the finding

that [petitioner] was limited to a reduced range of light

work,” and (b) “a finding regarding [petitioner’s] re-

sidual functional capacity was not essential to the

judgment actually rendered * * * in the earlier

action.” Pet. App. 28a. Furthermore, in the context of

judicial review of agency action—where a reviewing

court’s task ends once it uncovers error in the an-

-

18

nounced grounds of the particular agency decision be-

fore it, see pp. 11-12, supra—principles of claim and

issue preclusion should not be applied in a manner that

precludes the agency having primary jurisdiction from

re-examining the case on remand. Cf. Chenery, 332

US. at 200-201; p. 11, supra.

CONCLUSION

The petition for a writ of certiorari should be denied.

Respectfully submitted.

THEODORE B. OLSON

Solicitor General

ROBERT D. MCCALLUM, JR.

Assistant Attorney General

WILLIAM KANTER

MICHAEL E. ROBINSON

Attorneys

JUNE 2003

6 Petitioner also argues (Pet. 14) that the court of appeals’

decision conflicts with Shalala v. Schaefer, 509 U.S. 292 (1993),

because it renders remand orders (even those that grant less than

all the relief requested) “non-final.” Petitioner appears to confuse

the issue of finality for purposes of permitting appeal to a court of

appeals with the concept of a final judgment on the merits for pur-

poses of determining claim and issue preclusion. See Clay v.

United States, 123 S. Ct. 1072, 1076 (2003) (“Finality is variously

defined; like many legal terms, its precise meaning depends on

context.”). In this case, the district court’s initial decision did not

conclusively resolve the ultimate issue of petitioner’s entitlement

to benefits.