Schwab v. Colvin

Filing 26

ORDER granting 23 Motion for Attorney Fees in the amount of $7,402.30. This award shall be payable directly to Plaintiff and is subject to offset to satisfy any pre-existing debt that Plaintiff owes the United States pursuant to Astrue v. Ratliff, 560 U.S. 586, 594 (2010). Signed by Senior Judge James A Teilborg on 7/14/2017.(TCA)

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IN THE UNITED STATES DISTRICT COURT

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FOR THE DISTRICT OF ARIZONA

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Kimberly Lynn Schwab,

No. CV-15-01081-PHX-JAT

Plaintiff,

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v.

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Commissioner
Administration,

ORDER

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of

Social

Security

Defendant.

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Pending before the Court is Plaintiff Kimberly Lynn Schwab’s Motion for

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Attorneys’ Fees pursuant to the Equal Access to Justice Act (“EAJA”). (“Motion,”

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Doc. 23). Defendant Carolyn W. Colvin, Acting Commissioner of Social Security, has

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filed a response, (Doc. 24), to which Plaintiff has filed a reply, (Doc. 25). Having

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considered the parties’ filings, the Court now rules on the Motion.

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I.

Background

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In May of 2010, Plaintiff injured her lower back while lifting a table at work.

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(Doc. 17 at 2). Over the next few years, Plaintiff experienced difficulty maintaining even

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sedentary employment, and she “ha[d] not engaged in substantial gainful activity—

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including employment—since May 17, 2011.” (Id.). On September 26, 2011, Plaintiff

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filed a claim for a period of disability and disability insurance benefits with the Social

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Security Administration (“SSA”). (Id. at 3). The SSA denied the claim, and Plaintiff

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appealed to an Administrative Law Judge (“ALJ”), who also denied the claim and

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affirmed that decision upon reconsideration. (Id. at 3–4). The SSA Appeals Council

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denied Plaintiff’s request for review on April 14, 2015 prompting her to appeal to federal

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court on June 12, 2015. (Id. at 4).

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On appeal, this Court reversed the ALJ’s decision and remanded for further

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proceedings. (Id. at 28). The Court affirmed the ALJ’s decision on all issues except the

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finding that Dr. Tromp’s opinion be given “no weight.” (Id. at 23–26). On that issue, the

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Court found that while the ALJ mentioned multiple reasons to discount Dr. Tromp’s

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opinion, the decision to do so ultimately relied on the fact that Dr. Tromp’s examination

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was arranged “through attorney referral” and that this “permeate[d] the finding to such a

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degree that the Court [found] that it constitutes the sole basis for rejecting Dr. Tromp’s

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opinion, which is impermissible.” (Id. at 25–26).

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After the reversal, Defendant filed a Motion to Amend/Correct, (Doc. 19), which

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the Court denied, (Doc. 22). Plaintiff then filed the current Motion requesting attorneys’

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fees and costs under the EAJA. (Doc. 23).

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II.

Legal Standard

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The EAJA allows “a prevailing party other than the United States fees and other

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expenses . . . incurred by that party in any civil action . . . unless the court finds that the

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position of the United States was substantially justified or that special circumstances

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make an award unjust.” 28 U.S.C. § 2412(d)(1)(A) (2012). An applicant for disability

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benefits becomes a prevailing party for the purposes of the EAJA if the denial of her

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benefits is reversed and remanded regardless of whether disability benefits are ultimately

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awarded. Shalala v. Schaefer, 509 U.S. 292, 300–02 (1993).

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The “position of the United States” includes both its litigating position and the

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“action or failure to act by the agency upon which the civil action is based.”

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28 U.S.C. § 2412(d)(2)(D). For this position to be substantially justified, it must be

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“justified in substance or in the main–that is, justified to a degree that could satisfy a

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reasonable person.” Pierce v. Underwood, 487 U.S. 552, 565 (1988) (holding that

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substantially justified means having a reasonable basis both in law and fact). In EAJA

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actions, the government bears the burden of proving that its position was substantially

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justified. Gonzales v. Free Speech Coalition, 408 F.3d 613, 618 (9th Cir. 2005).

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However, “the government’s failure to prevail does not raise a presumption that its

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position was not substantially justified.” Kali v. Bowen, 854 F.2d 329, 332

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(9th Cir. 1988).

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When analyzing the government’s position for substantial justification, the Court’s

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inquiry should be focused on the issue that was the basis for remand and not the merits of

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Plaintiff’s claim in its entirety or the ultimate disability determination. Flores v. Shalala,

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49 F.3d 562, 569 (9th Cir. 2008); see also Corbin v. Apfel, 149 F.3d 1051, 1052

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(9th Cir. 1998) (“The government’s position must be substantially justified at each stage

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of the proceedings.” (citation and internal quotation marks omitted)).

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III.

Analysis

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As the prevailing party after winning remand from this Court, Plaintiff moves for

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an award of attorneys’ fees and costs under the EAJA in the amount of $7,402.30.

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Defendant opposes Plaintiff’s request, arguing that the government’s position was

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substantially justified, (Doc. 24 at 5), and, alternatively, the requested amount is

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unreasonable and should be reduced, (id. at 6).

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A.

Substantial Justification

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Defendant argues that the government’s position was substantially justified

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because it was “reasonably based in both law and fact” and that “one good reason is

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sufficient to affirm the decision.” (Id. at 5). Defendant also asserts that the government’s

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position met the substantial justification standard because there was a “genuine dispute”

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that “reasonable people could differ” about. (Id. at 4).

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The ALJ rejected Dr. Tromp’s opinion for three reasons: (1) it was

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“uncorroborated by the medical evidence of record”; (2) it “appear[ed]” to be “based on

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the claimant’s subjective complaints regarding her pain”; and (3) the examination was

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conducted “through attorney referral and in connection with an effort to generate

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evidence for the current appeal.” (Doc. 17 at 23–26). The Court found the ALJ’s

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reasoning to be improper due to its overwhelming “reliance on attorney referral” and

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remanded on the basis of this sole issue. (Id. at 26).

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Defendant first argues that the government’s defense of the ALJ’s position was

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reasonably based in law and fact because the ALJ provided a “specific and legitimate

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reason for discounting Dr. Tromp’s opinion,” and that “one good reason is sufficient to

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affirm the decision.” (Doc. 24 at 5). The Court finds this argument unpersuasive for three

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reasons. First, this is essentially the same argument the Court has already addressed in its

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order denying Defendant’s Motion to Amend/Correct. (Doc. 22 at 3–6).

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Second, the Court finds Defendant’s argument unpersuasive because it states that

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“the Court concurred that the ALJ provided a specific and legitimate reason for

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discounting Dr. Tromp’s opinion.” (Doc. 24 at 5 (citing Doc. 17 at 24–25)). This

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assertion, however, mischaracterizes the Court’s reasoning because, while Defendant’s

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assertion is correct, it ignores the subsequent paragraph in which the Court explains why

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the ALJ’s improper “reliance on attorney referral” impermissibly overshadowed the other

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stated reasons. Id.; see also Saelee v. Chater, 94 F.3d 520, 522–23 (9th Cir. 1996)

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(finding that an ALJ can question a doctor’s credibility when their opinion is solicited by

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claimant’s counsel, but this does not provide a legitimate basis for rejection).

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Finally, Defendant cites Carmickle v. Comm’r of Soc. Sec., 533 F.3d 1155, 1162

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(9th Cir. 2008) and Batson v. Comm’r of Soc. Sec., 359 F.3d 1190, 1197 (9th Cir. 2004)

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to argue that despite one invalid reason, an adverse credibility finding can remain legally

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valid so long as substantial evidence supporting the ultimate credibility conclusion exists.

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The Court finds that both of these cases are distinguishable from the present case because

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they deal with the credibility of a claimant’s testimony. Here, unlike in Carmickle or

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Batson, the credibility determination at issue is that of a treating physician, whose

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opinion is weighed differently than a claimant’s testimony. Compare Molina v. Astrue,

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674 F.3d 1104, 1112 (9th Cir. 2012) (defining a two-step analysis to determine a

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claimant’s credibility), with Murray v. Heckler, 722 F.2d 499, 502 (9th Cir. 1983)

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(recognizing that an ALJ must have “specific, legitimate reasons” that are “based on

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substantial evidence” in order to disregard the opinion of a treating physician). Also, in

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both cases, the Ninth Circuit Court of Appeals (the “Ninth Circuit”) determined the error

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to be harmless, or an error that is “inconsequential to the ultimate non-disability

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determination.” Carmickle, 533 F.3d at 1162 (citing Stout v. Comm’r of Soc. Sec.,

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454 F.3d 1050, 1055 (9th Cir. 2006)); see also Batson, 359 F.3d at 1196. Here, in

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contrast, the Court found that despite two good reasons, the ALJ’s excessive reliance on

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one bad reason was consequential to the overall non-disability determination and,

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thereby, constituted harmful error. (Doc. 17 at 26). Accordingly, the Court declines to

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follow Defendant’s line of reasoning as it is in direct conflict with this finding.

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Despite the harmful error identified by the Court, Defendant argues that because

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there is a “genuine dispute” about the current action and “reasonable people could differ

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as to [the appropriateness of the contested action],” it has satisfied its burden of proving

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that the government’s position was substantially justified. (Doc. 24 at 4). The Court

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disagrees with Defendant’s conclusion. The law in this area is well-settled and leaves

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little room for dispute as the Ninth Circuit has consistently found that when an ALJ

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commits fundamental procedural errors, the defense of these errors lacks substantial

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justification. See, e.g., Roe v. Comm’r of Soc. Sec., 651 F. App’x 583, 585

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(9th Cir. 2016); Corbin, 149 F.3d at 1052 (finding that “the government’s defense of

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basic and fundamental procedural errors” is “difficult to justify”); see also Shafer v.

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Astrue, 518 F.3d 1067, 1072 (9th Cir. 2008) (recognizing that an ALJ may commit a

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fundamental procedural error by rejecting a treating physician’s opinion in favor of a

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non-treating physician’s opinion without providing convincing reasons). Here, the ALJ’s

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decision to give no weight to Dr. Tromp’s opinion was overwhelmingly influenced by an

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improper reason. (Doc. 17 at 26). Therefore, the government’s defense of the ALJ’s

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procedural errors was not substantially justified, and Plaintiff is entitled to attorneys’ fees

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under the EAJA.

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B.

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Plaintiff requests attorneys’ fees in the amount of $7,002.30, in addition to the

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costs of $400.00, for a total of $7,402.30. (Doc. 23-4 at 6). This amount represents the

Fee Amount

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36.8 hours Plaintiff’s counsel has expended on her case multiplied by the hourly rate of

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$190.28 1. (Docs. 23-4 at 6; 23-5). Defendant argues that if fees are awarded, they should

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be reduced because they are unreasonable. (Doc. 24 at 6). At 36.8 hours, the total amount

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of hours expended by Plaintiff is within the standard range awarded for Social Security

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cases. Costa v. Comm’r of Soc. Sec., 690 F.3d 1132, 1136 (9th Cir. 2012) (“Many district

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courts have noted that twenty to forty hours is the range most often requested and granted

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in social security cases.” (citations omitted)). Therefore, the Court cannot find the

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requested fees unreasonable based solely on the hours Plaintiff’s counsel spent on the

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case.

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Defendant also argues that fees should be reduced because Plaintiff achieved

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limited success. (Doc. 24 at 6). When examining a plaintiff’s level of success, it is

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improper to reduce requested fees solely because he or she prevailed on some claims but

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not on others. Hensley v. Eckerhart, 461 U.S. 424, 436 (1983) (“Litigants in good faith

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may raise alternative legal grounds for a desired outcome, and the court’s rejection of or

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failure to reach certain grounds is not a sufficient reason for reducing a fee.”) Instead,

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where a plaintiff does not succeed on all claims, “the court must evaluate whether the

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successful and unsuccessful claims are ‘distinctly different claims for relief that are based

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on different facts and legal theories’ or whether they ‘involve a common core of facts or

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[are] based on related legal theories.’” Schwarz v. Sec’y of Health & Human Servs.,

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73 F.3d 895, 901 (9th Cir. 1995) (quoting Hensley, 461 U.S. at 434–35). Here, Plaintiff’s

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claims all revolve around her purported disabilities and the weight given to evidence

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about those disabilities. (Doc. 1 at 3). Therefore, Plaintiff’s claims “involve a common

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core of facts” and are “based on related legal theories.” Hensley, 461 U.S. at 435.

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Also, “if the claims are related, the district court ‘should focus on the significance

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of the overall relief obtained by the plaintiff in relation to the hours reasonably expended

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The base hourly rate for EAJA cases is $125 per hour. The rate of $190.28 is
used in Plaintiff’s fee calculation after taking the Ninth Circuit’s cost of living adjustment
into consideration. Statutory Maximum Rates Under the Equal Access to Justice Act,
http://www.ca9.uscourts.gov/content/view.php?pk_id=0000000039 (last visited July 12,
2017).
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on the litigation,’ and ‘a plaintiff who has won substantial relief should not have [her]

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attorney’s fee reduced simply because the district court did not adopt each contention

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raised.’” Schwarz, 73 F.3d at 901 (quoting Hensley, 461 U.S. at 440). In EAJA actions,

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“reversal and remand for further administrative proceedings – does constitute substantial

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relief.” Jones v. Colvin, No. 10-CV-05483-RJB-KLS, 2013 WL 3490630, at *9

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(W.D. Wash. Jun. 28, 2013); see also Eastman v. Astrue, No. 11-CV-701-PK,

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2013 WL 1130762, at *8 (D. Or. Mar. 15, 2013). Therefore, the Court finds that Plaintiff

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won substantial relief when her claim was remanded.

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The Court finds that Plaintiff’s counsel expended a reasonable amount of time to

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raise related claims that achieved substantial relief for Plaintiff. Based on these findings,

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the Court awards Plaintiff the total amount of requested attorneys’ fees, $7,002.30, in

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addition to the filing fee of $400.00, for a total of $7,402.30.

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IV.

Conclusion

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Based on the foregoing,

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IT IS ORDERED that Plaintiff’s Motion for an Award of Attorney’s Fees under

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the EAJA, (Doc. 23), is GRANTED in the amount of $7,402.30. This award shall be

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payable directly to Plaintiff and is subject to offset to satisfy any pre-existing debt that

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Plaintiff owes the United States pursuant to Astrue v. Ratliff, 560 U.S. 586, 594 (2010).

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Dated this 14th day of July, 2017.

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