Abbington v. Berryhill
Filing
26
ORDER denying 18 Motion to Remand; the Commissioner must file and serve her brief in accordance with the scheduling order 5 no later than 30 days following the date of entry of this order. Signed by Magistrate Judge Katherine P. Nelson on 12/13/18. (srr)
IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF ALABAMA
SOUTHERN DIVISION
BETTY A. ABBINGTON,
Plaintiff,
)
)
)
)
)
)
)
)
v.
NANCY A. BERRYHILL, Acting
Commissioner of Social Security,
Defendant.
CIVIL ACTION NO. 1:17-00552-N
ORDER
This action is before the Court on the Motion for Order of Remand (Doc. 18)
filed by Plaintiff Betty A. Abbington.
The Defendant Commissioner of Social
Security (“the Commissioner”) has timely filed a response (Doc. 24) in opposition to
the motion, Abbington has timely filed a reply (Doc. 25) to the response, and the
motion is now under submission. (See Doc. 23). Upon consideration, the Court
finds that Abbington’s motion (Doc. 18) is due to be DENIED.1
Abbington’s present motion asserts that her case must be remanded to the
Commissioner for a new hearing because the Administrative Law Judge (“ALJ”) who
issued an unfavorable decision on her applications for Social Security benefits
should be considered an “Officer of the United States” who was not properly
appointed in accordance with the Appointments Clause of Article II, Section 2 of the
United States constitution, based on the reasoning in the United States Supreme
With the consent of the parties, the Court has designated the undersigned
Magistrate Judge to conduct all proceedings in this civil action, in accordance with
28 U.S.C. § 636(c), Federal Rule of Civil Procedure 73, and S.D. Ala. GenLR 73.
(See Docs. 19, 20).
1
Court’s recent decision in Lucia v. SEC, 138 S. Ct. 2044 (2018). In response, the
Commissioner argues that Abbington forfeited this claim by failing to raise it at the
administrative level. The Court agrees.2
“[O]ne who makes a timely challenge to the constitutional validity of the
appointment of an officer who adjudicates his case is entitled to a decision on the
merits of the question and whatever relief may be appropriate if a violation indeed
occurred.”
Ryder v. United States, 515 U.S. 177, 182-83 (1995) (emphasis added).
Accord Lucia, 138 S. Ct. at 2055 (“This Court has held that ‘one who makes a timely
challenge to the constitutional validity of the appointment of an officer who
adjudicates his case’ is entitled to relief.” (quoting Ryder, 515 U.S. at 182-83)). In
Ryder, petitioner Ryder was an enlisted Coast Guard member challenging his
conviction by court-martial.
Ryder, 515 U.S. at 179.
Ryder appealed his
conviction to the Coast Guard Court of Military Review, raising an Appointments
Clause challenge to the composition of that court for the first time on a request for
rehearing.
Id.
After the Court of Military Review rejected his Appointments
Clause challenge and largely affirmed his conviction, Ryder appealed to the United
States Court of Military Appeals, which agreed that two of the three judges on the
Court of Military Review panel had been appointed in violation of the Appointments
The Commissioner expressly declines to argue whether Social Security ALJs are
“Officers of the United States” subject to the Appointments Clause (see Doc. 24 at 2
n.1), and the Court expresses no opinion on that issue.
2
Clause, but nevertheless affirmed Ryder’s conviction on the ground that the actions
of these judges were valid de facto. Id. at 179-80.3
On certiorari review, the Supreme Court reversed the Court of Military
Appeals, holding that the lower court had “erred in according de facto validity to the
actions of the civilian judges of the Coast Guard Court of Military Review.”
Ryder,
515 U.S. at 188. In finding that Ryder had timely raised his Appointment Clause
challenge, thus “entitl[ing him] to a hearing before a properly appointed panel of”
the Court of Military Review, the Court noted that Ryder “challenged the
composition of the Coast Guard Court of Military Review while his case was pending
before that court on direct review” and “raised his objection to the judges’ titles
before those very judges and prior to their action on his case.”
Id. at 182.
Lucia involved a situation more analogous to Social Security disability
adjudications, in which an ALJ issues a decision that is then subject to appellate
review by a higher administrative body prior to judicial review.
In that case, the
Court, citing Ryder’s “timely challenge” holding, held that the petitioner had made
such a timely challenge to the appointment of the Securities and Exchange
Commission ALJ who heard his case when “[h]e contested the validity of [the ALJ]’s
“The de facto officer doctrine confers validity upon acts performed by a person
acting under the color of official title even though it is later discovered that the
legality of that person's appointment or election to office is deficient. The de facto
doctrine springs from the fear of the chaos that would result from multiple and
repetitious suits challenging every action taken by every official whose claim to office
could be open to question, and seeks to protect the public by insuring the orderly
functioning of the government despite technical defects in title to office.” Ryder,
515 U.S. at 180 (citation and quotation omitted).
3
appointment before the Commission, and continued pressing that claim in the Court
of Appeals and th[e Supreme] Court[,]”
Lucia, 138 S. Ct. at 2055, even though the
petitioner had not raised the challenge to the ALJ himself. See id. at 2050 (“On
appeal to the SEC, Lucia argued that the administrative proceeding was invalid
because [the ALJ] had not been constitutionally appointed.”).4
The commonality between Ryder and Lucia is that both petitioners first raised
their Appointments Clause challenges to the entities utilizing the deficiently
appointed official or officials.5 On the other hand, in Freytag v. Commissioner of
Internal Revenue, 501 U.S. 868 (1991), the Court, at least implicitly, determined that
the petitioners had waived their Appointments Clause challenge to special trial
judges appointed by the United States Tax Court by “not only by failing to raise a
timely objection to the assignment of their cases to a special trial judge, but also by
Abbington argues that “[t]he Lucia court dealt with a different statutory scheme,
the Securities Exchange Act of 1934, which has explicit issue exhaustion
requirements.” (Doc. 25 at 4). However, there is no indication that the Lucia
majority relied on that statutory exhaustion requirement in finding the petitioner’s
Appointments Clause challenge timely there. Rather, Lucia cited only to Ryder’s
“timely challenge” holding, see Lucia, 138 S. Ct. at 2055, which also did not concern a
statutory exhaustion requirement.
4
See also NLRB v. RELCO Locomotives, Inc., 734 F.3d 764, 796 (8th Cir. 2013)
(“The waiver doctrine requires a party to make each argument it wishes to preserve
for appeal in a timely fashion before the original decisionmaker.” (emphasis
added)).
5
consenting to the assignment[,]” despite later raising the challenge in the circuit
court of appeals. 501 U.S. at 872, 878.6
Citing Lucia, the Ninth Circuit Court of Appeals has held, albeit in an
unpublished decision, that petitioners forfeited an Appointments Clause challenge to
an SEC hearing officer’s decision “by failing to raise it in their briefs or before the
agency.”
Kabani & Co., Inc. v. U.S. Sec. & Exch. Comm'n, 733 F. App'x 918, 919
(9th Cir. 2018) (emphasis added) (citing Lucia, 138 S. Ct. at 2055). In addressing
Appointment Clause challenges to Social Security ALJs since Lucia was decided,
numerous district courts have held that a claimant forfeits such a challenge by
failing to raise it at the administrative level.7
Nevertheless, the Court in Freytag considered the merits of the petitioners’
Appointments Clause challenge after determining that it could exercise discretion to
excuse the waiver. See infra.
6
See Trejo v. Berryhill, No. EDCV 17-0879-JPR, 2018 WL 3602380, at *3 n.3 (C.D.
Cal. July 25, 2018) (Rosenbluth, M.J.) (“To the extent Lucia applies to Social
Security ALJs, Plaintiff has forfeited the issue by failing to raise it during her
administrative proceedings.”); Davis v. Comm'r, No. 17-CV-80-LRR, 2018 WL
4300505, at *8 (N.D. Iowa Sept. 10, 2018) (Reade, J.) (“Unlike the plaintiff in Lucia,
Davis did not contest the validity of the Social Security Administration ALJ who
decided his case at the agency level. The record clearly demonstrates that Davis did
not raise his Appointments Clause argument before either the ALJ or the Appeals
Council. Rather, Davis raised this issue for the first time to this court on judicial
review, after Judge Williams had issued the Report and Recommendation. Because
Davis did not raise his Appointments Clause challenge before the ALJ or Appeals
Council, the court finds that he has waived this issue.”); Thurman v. Comm'r, No.
17-CV-35-LRR, 2018 WL 4300504, at *9 (N.D. Iowa Sept. 10, 2018) (Reade, J.) (same
as Davis); Iwan v. Comm'r, No. 17-CV-97-LRR, 2018 WL 4295202, at *9 (N.D. Iowa
Sept. 10, 2018) (Reade, J.) (same as Davis and Thurman); Stearns v. Berryhill, No.
C17-2031-LTS, 2018 WL 4380984, at *5 (N.D. Iowa Sept. 14, 2018) (Strand, C.J.)
(“In Lucia, the Supreme Court acknowledged the challenge was timely because it
7
Here, Abbington concedes that her Appointment Clause challenge was not
raised at any point during her administrative proceedings.
Nevertheless,
Abbington argues that, under the reasoning of Sims v. Apfel, 530 U.S. 103 (2000), the
judicially-imposed rule that an Appointments Clause challenge must be “timely”
raised does not apply to administrative proceedings in Social Security disability
determinations. 8
In Sims, the majority opinion first explained general “issue
exhaustion” principles as follows:
was made before the Commission… In the context of Social Security disability
proceedings, that means the claimant must raise the issue before the ALJ's decision
becomes final…Lucia makes it clear that this particular issue must be raised at the
administrative level.”); Davidson v. Comm’r of Social Security, No. 2:16-CV-00102,
2018 WL 4680327, at *2 (M.D. Tenn. Sept. 28, 2018) (Crenshaw, C.J.) (“Because
Plaintiff did not raise her as applied constitutional challenge at the administrative
level or argue that she had good cause for her failure to do so, Plaintiff has waived
her challenge to the appointment of her Administrative Law Judge.”); Garrison v.
Comm'r, No. 1:17-CV-00302-FDW, 2018 WL 4924554, at *2 (W.D.N.C. Oct. 10, 2018)
(Whitney, C.J.) (same as Trejo); Pearson v. Berryhill, No. 17-4031-SAC, 2018 WL
6436092, at *4 (D. Kan. Dec. 7, 2018) (“In light of the fact that plaintiff never raised
this issue before the Social Security Administration, the court finds that plaintiff did
not make a timely challenge to the constitutional validity of the appointment of the
ALJ.”); Willis, v. Commissioner of Social Security, No. 1:18-CV-158, 2018 WL
6381066, at *3 (S.D. Ohio Dec. 6, 2018) (“[T]he Court finds that plaintiff forfeited her
Appointments Clause challenge because she failed to present it to the Appeals
Council or the ALJ.”); Faulkner v. Comm'r of Soc. Sec., No. 117CV01197STAEGB,
2018 WL 6059403, at *3 (W.D. Tenn. Nov. 19, 2018) (“Plaintiff's failure to raise his
Appointments Clause challenge at any point in the administrative process or show
good cause why he did not do so forfeits his claim.”).
Sims recognized that, at least at the time it was decided, “SSA regulations do not
require issue exhaustion[,]” though the majority “th[ought] it likely that the
Commissioner could adopt a regulation that did require issue exhaustion.” 530
U.S. at 108. The Commissioner’s brief cites various regulations that she argues
“require a claimant to raise all issues – including constitutional issues – to the
agency at the earliest possible juncture.” (Doc. 24 at 6). The undersigned
8
The basis for a judicially imposed issue-exhaustion requirement is an analogy
to the rule that appellate courts will not consider arguments not raised before
trial courts. As the Court explained in Hormel v. Helvering, 312 U.S. 552, 61 S.
Ct. 719, 85 L. Ed. 1037 (1941):
“Ordinarily an appellate court does not give consideration to issues not
raised below. For our procedural scheme contemplates that parties shall
come to issue in the trial forum vested with authority to determine
questions of fact. This is essential in order that parties may have the
opportunity to offer all the evidence they believe relevant to the issues
which the trial tribunal is alone competent to decide; it is equally
essential in order that litigants may not be surprised on appeal by final
decision there of issues upon which they have had no opportunity to
introduce evidence. And the basic reasons which support this general
principle applicable to trial courts make it equally desirable that parties
should have an opportunity to offer evidence on the general issues
involved in the less formal proceedings before administrative agencies
entrusted with the responsibility of fact finding.” Id., at 556, 61 S. Ct.
719.
As we further explained in [United States v. ]L.A. Tucker Truck Lines,[ 344
U.S. 33, 73 S. Ct. 67, 97 L. Ed. 54 (1952),] courts require administrative issue
exhaustion “as a general rule” because it is usually “appropriate under [an
agency’s] practice” for “contestants in an adversary proceeding” before it to
develop fully all issues there. 344 U.S., at 36–37, 73 S. Ct. 67. (We also spoke
favorably of issue exhaustion in Unemployment Compensation Comm'n of
Alaska v. Aragon, 329 U.S. 143, 154–155, 67 S. Ct. 245, 91 L. Ed. 136 (1946),
without relying on any statute or regulation, but in that case the waived issue
had not been raised before the District Court, see id., at 149, 155, 67 S. Ct.
245.)
But, as Hormel and L.A. Tucker Truck Lines suggest, the desirability of a court
imposing a requirement of issue exhaustion depends on the degree to which
the analogy to normal adversarial litigation applies in a particular
administrative proceeding. Cf. McKart v. United States, 395 U.S. 185, 193, 89
S. Ct. 1657, 23 L. Ed. 2d 194 (1969) (application of doctrine of exhaustion of
expresses no opinion on whether those regulations, whether considered singly or in
the aggregate, impose a regulatory issue exhaustion requirement.
Ryder’s
requirement that an Appointments Clause challenge be “timely” raised is a judicially
imposed exhaustion requirement independent of any statutory or regulatory scheme,
and the undersigned finds that Abbington has failed to satisfy Ryder’s requirement.
administrative remedies “requires an understanding of its purposes and of the
particular administrative scheme involved”)….Where the parties are expected
to develop the issues in an adversarial administrative proceeding, it seems to
us that the rationale for requiring issue exhaustion is at its greatest. Hormel,
L.A. Tucker Truck Lines, and Aragon each involved an adversarial proceeding.
See Hormel, supra, at 554, 556, 61 S. Ct. 719; L.A. Tucker Truck Lines, supra,
at 36, 73 S. Ct. 67; Aragon v. Unemployment Compensation Comm'n of Alaska,
149 F.2d 447, 449–452 (C.A. 9 1945), aff'd. in part and rev'd in part, 329 U.S.
143, 67 S. Ct. 245, 91 L. Ed. 136 (1946). (In Hormel, we allowed an exception to
the issue-exhaustion requirement. 312 U.S., at 560, 61 S. Ct. 719.) Where, by
contrast, an administrative proceeding is not adversarial, we think the
reasons for a court to require issue exhaustion are much weaker. More
generally, we have observed that “it is well settled that there are wide
differences between administrative agencies and courts,” Shepard v. NLRB,
459 U.S. 344, 351, 103 S. Ct. 665, 74 L. Ed. 2d 523 (1983), and we have thus
warned against reflexively “assimilat[ing] the relation of ... administrative
bodies and the courts to the relationship between lower and upper courts,”
FCC v. Pottsville Broadcasting Co., 309 U.S. 134, 144, 60 S. Ct. 437, 84 L. Ed.
656 (1940).
Sims, 530 U.S. at 108–10. After considering these principles, a four-justice plurality
of the Court then stated:
The differences between courts and agencies are nowhere more pronounced
than in Social Security proceedings. Although “[m]any agency systems of
adjudication are based to a significant extent on the judicial model of
decisionmaking,” 2 K. Davis & R. Pierce, Administrative Law Treatise § 9.10,
p. 103 (3d ed.1994), the SSA is “[p]erhaps the best example of an agency” that
is not, B. Schwartz, Administrative Law 469–470 (4th ed. 1994). See id., at 470
(“The most important of [the SSA's modifications of the judicial model] is the
replacement of normal adversary procedure by ... the ‘investigatory model’ ”
(quoting Friendly, Some Kind of Hearing, 123 U. Pa. L. Rev. 1267, 1290
(1975))). Social Security proceedings are inquisitorial rather than adversarial.
It is the ALJ’s duty to investigate the facts and develop the arguments both for
and against granting benefits, see Richardson v. Perales, 402 U.S. 389, 400–
401, 91 S. Ct. 1420, 28 L. Ed. 2d 842 (1971), and the Council’s review is
similarly broad. The Commissioner has no representative before the ALJ to
oppose the claim for benefits, and we have found no indication that he opposes
claimants before the Council. See generally Dubin, Torquemada Meets Kafka:
The Misapplication of the Issue Exhaustion Doctrine to Inquisitorial
Administrative Proceedings, 97 Colum. L. Rev. 1289, 1301–1305, 1325–1329
(1997).
The regulations make this nature of SSA proceedings quite clear. They
expressly provide that the SSA “conduct[s] the administrative review process
in an informal, nonadversary manner.” 20 CFR § 404.900(b) (1999). They
permit—but do not require—the filing of a brief with the Council (even when
the Council grants review), § 404.975, and the Council's review is plenary
unless it states otherwise, § 404.976(a). See also § 404.900(b) ( “[W]e will
consider at each step of the review process any information you present as well
as all the information in our records”). The Commissioner's involvement in the
Appeals Council's decision whether to grant review appears to be not as a
litigant opposing the claimant, but rather just as an adviser to the Council
regarding which cases are good candidates for the Council to review pursuant
to its authority to review a case sua sponte. See §§ 404.969(b)-(c); Perales,
supra, at 403, 91 S. Ct. 1420. The regulations further make clear that the
Council will “evaluate the entire record,” including “new and material
evidence,” in determining whether to grant review. § 404.970(b). Similarly, the
notice of decision that ALJ’s provide unsuccessful claimants informs them that
if they request review, the Council will “consider all of [the ALJ's] decision,
even the parts with which you may agree,” and that the Council might review
the decision “even if you do not ask it to do so.” App. 25–27. Finally, Form HA–
520, which the Commissioner considers adequate for the Council's purposes in
determining whether to review a case, see § 422.205(a), provides only three
lines for the request for review, and a notice accompanying the form estimates
that it will take only 10 minutes to “read the instructions, gather the
necessary facts and fill out the form.” The form therefore strongly suggests
that the Council does not depend much, if at all, on claimants to identify issues
for review. Given that a large portion of Social Security claimants either have
no representation at all or are represented by non-attorneys, see Dubin, supra,
at 1294, n. 29, the lack of such dependence is entirely understandable.
Thus, the Hormel analogy to judicial proceedings is at its weakest in this area.
The adversarial development of issues by the parties—the “com[ing] to issue,”
312 U.S., at 556, 61 S. Ct. 719—on which that analogy depends simply does
not exist. The Council, not the claimant, has primary responsibility for
identifying and developing the issues. We therefore agree with the Eighth
Circuit that “the general rule [of issue exhaustion] makes little sense in this
particular context.” Harwood[ v. Apfel], 186 F.3d[ 1039,] 1042[ (8th Cir. 1999)].
Accordingly, we hold that a judicially created issue-exhaustion requirement is
inappropriate. Claimants who exhaust administrative remedies need not also
exhaust issues in a request for review by the Appeals Council in order to
preserve judicial review of those issues.
Id. at 110–12.9
Assuming without deciding that the reasoning of Sims would permit an
Appointments Clause challenge not raised at the Appeals Council level to still be
“timely” under Ryder and Lucia,10 Sims expressly noted that “[w]hether a claimant
must exhaust issues before the ALJ is not before us.” 530 U.S. at 107. Unlike the
Appeals Council’s ability to review an ALJ’s decision even if a claimant does not
request it, an ALJ will only hold a hearing if a request is made, see 20 C.F.R. §
404.930(b), and the right to an ALJ hearing can be forfeit if one is not timely
requested. Id. § 404.390(c). Unlike the cursory form request for Appeals Council
review examined in Sims, which “strongly suggest[ed] that the Council does not
In her concurring opinion, Justice O’Connor stated that she declined to join the
plurality’s reasoning because, “in [her] view, the agency’s failure to notify claimants
of an issue exhaustion requirement in th[e] context [presented] is a sufficient basis
for our decision.” Sims, 530 U.S. at 113 (O’Connor, J., concurring in part and
concurring in the judgment). Because “the SSA told petitioner (1) that she could
request review by sending a letter or filling out a 1–page form that should take 10
minutes to complete, (2) only that failing to request Appeals Council review would
preclude judicial review, and (3) that the Appeals Council would review her entire
case for issues[,]” and because the petitioner “did everything that the agency asked of
her[,]” Justice O’Connor stated that she “would not impose any additional
requirements” to exhaust issues before the Appeals Council. Id. at 114.
9
Under 20 C.F.R. § 404.940, if a claimant objects to an ALJ’s ability to conduct the
hearing and the ALJ “does not withdraw, [the claimant] may, after the hearing,
present [her] objections to the Appeals Council as reasons why the hearing decision
should be revised or a new hearing held before another administrative law judge.”
Arguably, then, § 404.940 requires a claimant to specifically raise objections to the
Appeals Council regarding the ALJ’s fitness to issue a decision in order for the
Appeals Council to consider them.
10
depend much, if at all, on claimants to identify issues for review[,]” 530 U.S. at 112, a
request for an ALJ hearing requires the claimant to provide, inter alia, “the reasons
[the claimant] disagree[s] with the previous determination or decision” and a
“statement of additional evidence to be submitted…” 20 C.F.R. § 404.933(a)(2)-(3).
Unlike the “plenary review” exercised by the Appeals Council, which might even
review portions of a decision with which a claimant agrees, generally “[t]he issues
before the administrative law judge include all the issues brought out in the initial,
reconsidered or revised determination that were not decided entirely in [the
claimant’s] favor[,]” Id. § 404.946(a), which can hardly be expected to include a
constitutional challenge to the ALJ’s authority.
While “[t]he administrative law judge or any party may raise a new issue[,]”
even if “it arose after the request for a hearing and even though it has not been
considered in an initial or reconsidered determination[,]” the ALJ is not required to
consider new issues, and can only do so “if he or she notifies [the claimant] and all the
parties about the new issue any time after receiving the hearing request and before
mailing notice of the hearing decision.” Id. § 404.946(b)(1). Moreover, the Social
Security regulations appear to require an ALJ to withdraw from hearing a case on
his or her own initiative only “if he or she is prejudiced or partial with respect to any
party or has any interest in the matter pending for decision.”
Id. § 404.940.
Otherwise, a claimant is required to “notify the administrative law judge at [the]
earliest opportunity” if she objects to that ALJ conducting the hearing.
Id.
Considering the foregoing, and given that the “timely” Appointments Clause
challenges in Ryder and Lucia were both first raised to the entities utilizing the
deficiently appointed officials, the undersigned finds that Abbington was required to
raise her Appointments Clause challenge at least to the ALJ for it to be a “timely
challenge” on judicial review.11
Abbington also argues the forfeiture of her Appointments Clause challenge
should be excused under the reasoning of Freytag.12 In that case, the Internal
Revenue Commissioner argued that the petitioners had waived their right to assert
this challenge, “not only by failing to raise a timely objection to the assignment of
their cases to a special trial judge, but also by consenting to the assignment.”
Freytag, 501 U.S. at 878. The Court held that it could consider the merits of the
challenge regardless of any such waiver, explaining:
This Court in the past…has exercised its discretion to consider
nonjurisdictional claims that had not been raised below. See Grosso v. United
States, 390 U.S. 62, 71–72, 88 S. Ct. 709, 715, 19 L. Ed. 2d 906 (1968); Glidden
Co. v. Zdanok, 370 U.S. 530, 535–536, 82 S. Ct. 1459, 1464–1465, 8 L. Ed. 2d
671 (1962); Hormel v. Helvering, 312 U.S. 552, 556–560, 61 S. Ct. 719, 721–
723, 85 L. Ed. 1037 (1941). Glidden expressly included Appointments Clause
Other district courts have similarly rejected the argument that Sims excuses a
Social Security claimant’s failure to raise an Appointments Clause challenge at the
administrative level. Pearson, 2018 WL 6436092, at *4; Willis, 2018 WL 6381066,
at *2-3; Stearns, 2018 WL 4380984, at *4-6.
11
As Abbington correctly notes, the Eleventh Circuit has recognized Sims for the
proposition that “a Social Security claimant’s failure to raise an issue at the
administrative level does not deprive a court of jurisdiction to consider the issue
when it is raised for the first time during judicial proceedings.” Loudermilk v.
Barnhart, 290 F.3d 1265, 1268 n.1 (11th Cir. 2002) (per curiam) (generally citing
Sims).
12
objections to judicial officers in the category of nonjurisdictional structural
constitutional objections that could be considered on appeal whether or not
they were ruled upon below:
“And in Lamar v. United States, 241 U.S. 103, 117–118[, 36 S. Ct. 535,
539–540, 60 L. Ed. 912 (1916) ], the claim that an intercircuit
assignment ... usurped the presidential appointing power under Art. II,
§ 2, was heard here and determined upon its merits, despite the fact
that it had not been raised in the District Court or in the Court of
Appeals or even in this Court until the filing of a supplemental brief
upon a second request for review.” Glidden, 370 U.S., at 536, 82 S. Ct.,
at 1465 (Harlan, J., announcing the judgment of the Court).
Like the Court in Glidden, we are faced with a constitutional challenge that is
neither frivolous nor disingenuous. The alleged defect in the appointment of
the Special Trial Judge goes to the validity of the Tax Court proceeding that is
the basis for this litigation. It is true that, as a general matter, a litigant must
raise all issues and objections at trial. But the disruption to sound appellate
process entailed by entertaining objections not raised below does not always
overcome what Justice Harlan called “the strong interest of the federal
judiciary in maintaining the constitutional plan of separation of powers.” Ibid.
We conclude that this is one of those rare cases in which we should exercise
our discretion to hear petitioners’ challenge to the constitutional authority of
the Special Trial Judge.
Id. at 878–79.
Abbington’s constitutional challenge here is also “neither frivolous nor
disingenuous.”
However, the undersigned is not convinced that this is “one of those
rare cases” as in Freytag where forfeiture should be excused.13 First, regularly
See Freytag, 501 U.S. at 893–94 (Scalia, J., concurring in part and concurring in
the judgment) (“Appointments Clause claims, and other structural constitutional
claims, have no special entitlement to review. A party forfeits the right to advance on
appeal a nonjurisdictional claim, structural or otherwise, that he fails to raise at
trial. Although I have no quarrel with the proposition that appellate courts may, in
truly exceptional circumstances, exercise discretion to hear forfeited claims, I see no
basis for the assertion that the structural nature of a constitutional claim in and of
itself constitutes such a circumstance; nor do I see any other exceptional
13
excusing forfeiture of Appointments Clause challenges under Freytag risks eroding
the rule in Ryder, decided nearly four years after Freytag and recently reaffirmed in
Lucia, that an Appointments Clause challenge must be “timely” to afford the
challenger relief. Second, the undersigned notes that Freytag, Glidden, and Lamar
all involved Appointments Clause challenges concerning entities of a more judicial
nature than the Social Security Administration – the U.S. Tax Court in Freytag, and
the U.S. courts of appeal and/or district courts in Glidden and Lamar. See United
States v. Jones, 74 M.J. 95, 96 (C.A.A.F. 2015) (“Citing Ryder…, the Government
urges that we treat the issue of Mr. Soybel’s appointment[ to the United States Air
circumstance in the present case.”); Evans v. Stephens, 387 F.3d 1220, 1238 (11th
Cir. 2004) (en banc) (Wilson, J., dissenting) (“The Supreme Court has held that
Appointments Clause objections are ‘nonjurisdictional’ and thus are subject to
forfeiture and waiver analysis. Freytag v. Comm'r of Internal Revenue, 501 U.S. 868,
878, 111 S. Ct. 2631, 2639, 115 L. Ed. 2d 764 (1991) (citations omitted). In Freytag,
the Supreme Court chose to address the Appointments Clause challenge before it,
but never suggested that it was compelled to do so. In fact, the majority
characterized its exercise of its discretion in that case as ‘rare.’ Id. at 879, 111 S. Ct.
at 2639. Four Justices would not have reached the merits of the claim at all. See id.
at 892, 111 S. Ct. at 2646 (Scalia, J., concurring in part and concurring in the
judgment, joined by Justices O'Connor, Kennedy, and Souter).”); NLRB v. RELCO
Locomotives, Inc., 734 F.3d 764, 795 (8th Cir. 2013) (“Freytag indicates that a
reviewing court generally is permitted (though not obliged) to hear a belated
appointments clause challenge.”); In re DBC, 545 F.3d 1373, 1380 (Fed. Cir. 2008)
(“Like this case, Freytag…and Glidden involved constitutional challenges under the
Appointments Clause. The Supreme Court has never indicated that such challenges
must be heard regardless of waiver. See Freytag, 501 U.S. at 893, 111 S. Ct. 2631
(Scalia, J., concurring in part and concurring in the judgment) (observing that the
court did not create a general rule excusing waiver). Rather, the Court has proceeded
on a case-by-case basis, determining whether the circumstances of the particular
case warrant excusing the failure to timely object. See id., 501 U.S. at 879, 111 S. Ct.
2631 (‘We conclude that this is one of those rare cases in which we should exercise
our discretion to hear petitioners' challenge to the constitutional authority of the
Special Trial Judge.’).”).
Force Court of Criminal Appeals] as forfeited by the failure of Appellant to raise the
issue prior to petitioning this Court. The problem with this approach is that it
ignores the consistent treatment of the de facto officer doctrine by the Supreme
Court, which has drawn a distinction between deficiencies which are ‘merely
technical’ and may be forfeited if not timely raised, and those which ‘embod[y] a
strong policy concerning the proper administration of judicial business,’ which the
Court will reach on direct review whether raised below or not.” (quoting Glidden,
370 U.S. at 535–36)).
Finally, Ryder’s rule that relief is due for “timely” challenges was created as
an incentive “to raise Appointments Clause challenges with respect to questionable
judicial appointments.”
Ryder, 515 U.S. at 182–83.
Regularly permitting
unsuccessful claimants to raise Appointments Clause challenges for the first time on
judicial review, especially when the arguments underlying those challenges were
available at the administrative level, would “encourage the practice of ‘sandbagging’:
suggesting or permitting, for strategic reasons, that the [adjudicative entity] pursue
a certain course, and later—if the outcome is unfavorable—claiming that the course
followed was reversible error.”
Freytag, 501 U.S. at 895 (Scalia, J., concurring in
part and concurring in the judgment).
Here, Freytag itself, decided in 1991, gave
Abbington sufficient authority to raise the present Appointments Clause challenge
at the administrative level.
Though Abbington claims that her challenge is brought under the reasoning of
the recent Lucia decision, Lucia relied almost exclusively on Freytag’s reasoning,
noting that Freytag involved “adjudicative officials who are near-carbon copies of the
[SEC]’s ALJs[,]” and that the “analysis there (sans any more detailed legal criteria)
necessarily decides this case.”
Lucia, 138 S. Ct. at 2052.14 Lucia itself is hardly
facially dispositive of whether Social Security ALJs are “Officers of the United
States” subject to the Appointments Clause, and nowhere in her briefing does
The undersigned concedes that, Lucia’s assertions to the contrary, Freytag’s
applicability to SEC ALJs was not readily apparent to at least some lower courts.
See Bandimere v. United States Sec. & Exch. Comm'n, 855 F.3d 1128, 1129 (10th
Cir. 2017) (Lucero, J., joined by Moritz, J., dissenting from the denial of rehearing en
banc) (“[T]he panel decision needlessly and improvidently expands the reach of
Freytag v. Commissioner, 501 U.S. 868, 111 S. Ct. 2631, 115 L. Ed. 2d 764 (1991),
which involved judges on the Tax Court, to the unrelated issue of agency
administrative law judges (‘ALJs’). In light of the significant consequences of this
decision, it is not our office to expand the holding in Freytag, to the contrary, any
such expansion should remain in the sole discretion of the Supreme Court.”).
Nevertheless, the argument was available to Abbington at the time of her ALJ
hearing. See Island Creek Coal Co. v. Wilkerson, -- F.3d ---, No. 18-3147, 2018 WL
6301617, at *2 (6th Cir. Dec. 3, 2018) (“Island Creek also cannot hold the line on the
ground that its Appointments Clause challenge lacked merit until the Supreme
Court decided Lucia v. Securities & Exchange Commission, ––– U.S. ––––, 138 S. Ct.
2044, 201 L. Ed. 2d 464 (2018). No precedent prevented the company from bringing
the constitutional claim before then. Lucia itself noted that existing case law ‘says
everything necessary to decide this case.’ Id. at 2053. The Tenth Circuit, before
Lucia, held that administrative law judges were inferior officers. Bandimere v. SEC,
844 F.3d 1168, 1188 (10th Cir. 2016). And many other litigants pressed the issue
before Lucia. See, e.g., Tilton v. SEC, 824 F.3d 276, 281 (2d Cir. 2016); Bennett v.
SEC, 844 F.3d 174, 177–78 (4th Cir. 2016); Burgess v. FDIC, 871 F.3d 297, 299 (5th
Cir. 2017); Jones Bros.[ v. Sec’y of Labor], , 898 F.3d [669,] 672[ (6th Cir. 2018)]. That
the Supreme Court once denied certiorari in a similar Appointments Clause case
adds nothing because such decisions carry no precedential value. See Teague v. Lane,
489 U.S. 288, 296, 109 S. Ct. 1060, 103 L. Ed. 2d 334 (1989).”).
14
Abbington attempt to substantively compare Social Security ALJs to the SEC ALJ at
issue in Lucia.15
See DBC, 545 F.3d at 1380 (“We decline DBC’s invitation to consider a[n
Appointments Clause] challenge it failed to timely raise, as we do not view the
circumstances of this case to warrant such an exceptional measure. Primarily, we
reemphasize that while this issue could have been raised before the Board[ of Patent
Appeals], it was not. Although DBC may not have appreciated the argument until
discovering Professor Duffy’s article, that article was not an intervening change in
law or facts, nor was it based on any legal or factual propositions that were not
knowable to DBC when it was proceeding before the Board. We are not persuaded to
overlook DBC's lack of diligence to present an issue of which it was, or should have
been, aware. To permit litigants like DBC to raise such issues for the first time on
appeal would encourage what Justice Scalia has referred to as sandbagging, i.e.,
‘suggesting or permitting, for strategic reasons, that the trial court pursue a certain
course, and later—if the outcome is unfavorable—claiming that the course followed
was reversible error.’ Freytag, 501 U.S. at 895, 111 S. Ct. 2631 (Scalia, J., concurring
in part and concurring in the judgment).”); RELCO Locomotives, 734 F.3d at 795–96
(“RELCO first attempts to argue that it did not waive its appointments clause
challenge, for it raised the issue only a few weeks after Noel Canning[ v. NLRB, 705
F.3d 490 (D.C. Cir. 2013)],was decided. RELCO asserts that it had no way of
anticipating ‘the relatively arcane constitutional grounds’ that led to the decision in
Noel Canning, and complains that it cannot be asked to ‘raise (or risk waiving) every
potential legal argument, no matter how novel and lacking in legal support.’ …
Nothing about this case indicates we should deviate from [the waiver doctrine]. All of
the facts and legal arguments necessary to make an appointments clause challenge
were available to RELCO when its case was heard by the Board. RELCO was aware
that the NLRB’s quorum included recess appointees, and it was aware of when and
by what means those members were appointed. Indeed, according to RELCO the
legal argument has been available since the 1789 ratification of the Constitution.
The fact that RELCO initially decided not to pursue this argument because it viewed
it as ‘arcane,’ ‘novel,’ and ‘lacking in legal support’ is a strategic decision whose
consequences it must accept. The decision in Spiegla v. Hull, 481 F.3d 961 (7th Cir.
2007), on which RELCO relies, grew out of circumstances not present here. In
Spiegla, a party did not raise an argument which had been specifically rejected by a
Seventh Circuit panel in an earlier appeal. Id. at 964. The Seventh Circuit allowed
the party to raise the issue later because an intervening Supreme Court decision had
called the earlier panel opinion into question. Id. Here by contrast, there was no
binding precedent which would have foreclosed RELCO's appointments clause
challenge. Noel Canning itself is not binding on us and did not change the state of
15
Accordingly, the undersigned finds that Abbington has forfeited her
Appointments Clause challenge to the ALJ who heard her case by failing to raise
that challenge before the Social Security Administration, and Abbington has not
shown sufficient cause to excuse the forfeiture. Thus, Abbington’s Motion for Order
of Remand (Doc. 18) is DENIED.
As directed in the Court’s order dated August 22, 2018 (see Doc. 23 at 2), the
Commissioner must file and serve her brief in accordance paragraphs 4 and 5 of the
scheduling order (Doc. 5) no later than 30 days following the date of entry of this
order.
DONE and ORDERED this the 13th day of December 2018.
/s/ Katherine P. Nelson
KATHERINE P. NELSON
UNITED STATES MAGISTRATE JUDGE
the law in this circuit.”); United States v. Suescun, 237 F.3d 1284, 1288 (11th Cir.
2001) (“[E]ven if we were to assume that Keefer's appointment as temporary United
States Attorney was invalid1-because it was not made in conformance with the
Appointments Clause-we conclude that the appointment did not deprive the district
court of jurisdiction to entertain the case and to adjudicate Suescun guilty of the
charged offenses. Suescun waived his objection to the validity of the indictment
because he did not present it as required by Rule 12(b), and the jurisdictional
exception does not apply.” (footnote omitted)); Faulkner, 2018 WL 6059403, at *2-3
(declining to excuse forfeiture of Lucia claim under reasoning of Freytag).
Advanced Disposal Servs. E., Inc. v. NLRB, 820 F.3d 592 (3d Cir. 2016), cited
by Abbington in support of her Freytag argument, is not persuasive. That case
involved excusing a belated challenge to the statutory authority of the National
Labor Relations Board’s to act without a valid quorum, rather than an Appointments
Clause challenge. Moreover, whereas Freytag calls for waiver in “rare cases,” the
Third Circuit excused waiver in Advanced Disposal under the specific statutory
authority allowing courts to consider issues not first raised to the NLRB when the
failure to raise them was due to “extraordinary circumstances.” 29 U.S.C. § 160(e).
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