McNeely v. Commissioner of Social Security

Filing 30

ORDER signed by District Judge Kimberly J. Mueller on 1/24/2019 NOT ADOPTING 26 Findings and Recommendations, DENYING 23 Motion for Summary Judgment, and GRANTING 20 Motion for Summary Judgment insofar as it requests a rehearing. This matter is REMANDED to the Commissioner for rehearing on the specific issues outlined. CASE CLOSED. (Huang, H)

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UNITED STATES DISTRICT COURT

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FOR THE EASTERN DISTRICT OF CALIFORNIA

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DARYL WAYNE MCNEELY,

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Plaintiff,

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No. 2:17-cv-00335-KJM-KJN

v.

ORDER

COMMISSIONER OF SOCIAL
SECURITY,
Defendant.

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Plaintiff Daryl Wayne McNeely seeks judicial review of a final decision by the

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Commissioner of Social Security (“Commissioner”) denying his Supplemental Security Income

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under Title XVI of the Social Security Act. On December 20, 2017, plaintiff filed a motion for

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summary judgment, arguing that the decision of the Administrative Law Judge (“ALJ”) is based

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on legal error and is not supported by substantial evidence in the record. ECF No. 20. The

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Commissioner opposed plaintiff’s motion and filed a cross-motion for summary judgment on

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January 10, 2018. ECF No. 23. On August 13, 2018, the magistrate judge filed findings and

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recommendations granting summary judgment to the Commissioner. Findings &

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Recommendations (“Findings”), ECF No. 26. Plaintiff filed objections to the findings and

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recommendations, ECF Nos. 27, 28, and the Commissioner responded, ECF No. 29.

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In accordance with the provisions of 28 U.S.C. § 636(b)(1)(C) and Local Rule 304,

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this court has conducted a de novo review of this case. Having reviewed the file, the court finds

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that the findings and recommendations are supported by the record and the proper analysis,

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except with respect to the finding that the ALJ did not err or, in the alternative, committed a

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harmless error, when she found plaintiff could perform past relevant work. Findings at 14–15.

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Accordingly, the court declines to adopt the findings and recommendations and remands the

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matter to the Commissioner for rehearing consistent with this order.

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I.

THE ALJ ERRED BY MISCHARACTERIZING PAST WORK

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In his findings and recommendations, the magistrate judge recommends granting

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defendant’s motion for summary judgment, affirming the ALJ’s finding that plaintiff is “capable

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of performing his past relevant work” under step four of the ALJ’s disability analysis, and is

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therefore not disabled within the meaning of 20 C.F.R. § 416.920. Findings at 14; see also

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Administrative Transcript (AT), ECF No. 13-3 at 32 (citing 20 C.F.R. § 416.920). The

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magistrate judge notes, “[p]ast relevant work is work [1] that [the claimant has] done within the

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past 15 years, [2] that was substantial gainful activity, and [3] that lasted long enough for [the

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claimant] to learn to do it.” Findings at 14 (citing 20 C.F.R. § 416.960(b)(1)) (emphasis added).

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He then finds that the ALJ could reasonably conclude plaintiff’s work as a hand packager

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qualifies as past relevant work. Id. at 14.

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Plaintiff argues that his work as a hand packager cannot be considered past

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relevant work, because it was not “substantial gainful activity” under 20 C.F.R. § 416.974. Objs.

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to Findings & Recommendations, ECF No. 27 at 5–6.

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The regulation plaintiff cites defines an “unsuccessful work attempt” as work that

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the claimant performed for a period of six months or less, that occurs after a period of

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unemployment due to claimant’s impairment, and that ends because of plaintiff’s impairment or

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because special conditions1 are removed. 20 C.F.R. § 416.974(c)(1)–(3). An “unsuccessful work

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“Special conditions” are accommodations or unique circumstances that allow an individual to
perform certain work. See 20 C.F.R. § 416.973(c) (“The work you are doing may be done under
special conditions that take into account your impairment, such as work done in a sheltered
workshop or as a patient in a hospital.”). Examples of special conditions include being allowed to
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attempt” is not considered a substantial gainful activity for the purposes of qualifying an

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applicant’s past work activities as “past relevant work.” Bray v. Comm'r of Soc. Sec. Admin.,

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554 F.3d 1219, 1221 n.1 (9th Cir. 2009) (concluding that, because plaintiff’s stint as a grocery

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clerk was “an unsuccessful work attempt,” it did not amount to “substantial gainful activity” and

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therefore “cannot be considered ‘past relevant work’”) (citing 20 C.F.R. § 404.1560(b)(1)); see

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also § 416.974(c)(1) (“[W]ork you have done will not show that you are able to do substantial

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gainful activity if, after working for a period of 6 months or less, you were forced by your

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impairment to stop working . . . .”).

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According to plaintiff, because he only performed the hand packaging work for

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slightly over a month and quit because of his impairments, that work was instead an

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“unsuccessful work attempt” under 20 C.F.R. § 416.974(c). Id. The Commissioner argues that

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the record does not support plaintiff’s contention that he quit the hand packaging job due to his

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disability, because he had not yet claimed a disability at that time. Def.’s Mot. Summ. J., ECF

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No. 23 at 24 n.10. The record is not entirely clear on this point; plaintiff testified that he left the

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job because he “just . . . couldn’t handle it,” but later elaborated that living very far from the job

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made it difficult to sustain. AT at 59–60. Neither the magistrate judge nor the ALJ address

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whether the short duration of plaintiff’s work as a hand packager and his reasons for leaving the

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job render the work an “unsuccessful work attempt” rather than “substantial gainful activity.” See

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Findings at 15.

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II.

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THE ERROR IS NOT HARMLESS
The magistrate judge finds that, “even if the ALJ erred in finding plaintiff was

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capable of past relevant work, any error would be harmless,” because “even if the ALJ had

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continued to step five of the sequential evaluation, she would have still concluded that plaintiff

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was not under a disability.” Findings at 15 (citing Lester v. Chater, 81 F.3d 821, 828 n.5 (9th Cir.

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1995); 20 C.F.R. § 416.969). The court disagrees. The ALJ’s finding that plaintiff is not under a

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disability hinges on her conclusion that “the claimant is able to perform . . . past relevant work of

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work irregular hours or take frequent rest periods, or being provided with special equipment. 20
C.F.R. § 416.973(c)(2)–(3).
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hand packager as actually performed by the claimant and as generally performed in the regional

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and national economy.” AT 32. The ALJ did not find that either of plaintiff’s other two previous

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occupations were appropriate for plaintiff, given his age, education, work experience, and

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residual functional capacity. AT at 32. The ALJ did not address step five: “whether the claimant

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is able to do any other work considering his residual functional capacity, age, education, and

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work experience.” AT at 18 (citing C.F.R. § 416.960(g); id. at 32–33. The magistrate judge

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merely assumes that, because of the vocational expert’s testimony on the subject, the ALJ would

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still have concluded that plaintiff was not under a disability. Findings at 15. The court cannot

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affirm the ALJ’s decision on a ground she did not invoke in making her decision. See Bray, 554

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F.3d at 1225–26 (“Long-standing principles of administrative law require us to review the ALJ's

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decision based on the reasoning and factual findings offered by the ALJ—not post

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hoc rationalizations that attempt to intuit what the adjudicator may have been thinking.”) (citing

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SEC v. Chenery Corp., 332 U.S. 194, 196 (1947)); Pinto v. Massanari, 249 F.3d 840, 847 (9th

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Cir. 2001) (“[W]e cannot affirm the decision of an agency on a ground that the agency did not

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invoke in making its decision.”). The ALJ’s error in finding plaintiff capable of performing “past

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relevant work” is not harmless, particularly because, if the ALJ had proceeded to step five of the

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disability analysis, the burden would have shifted to the Commissioner to show the claimant has

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the capacity to perform other work. Bowen v. Yuckert, 482 U.S. 137, 146 n.5 (1987); cf.

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Tommasetti v. Astrue, 533 F.3d 1035, 1038 (9th Cir. 2008) (“[T]he court will not reverse an

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ALJ’s decision for harmless error, which exists when it is clear from the record that the ALJ’s

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error was inconsequential to the ultimate nondisability determination.”) (citations and internal

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quotation marks omitted).

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Because the ALJ’s conclusion at step four either was based on legal error or based

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on an undisclosed factual finding that the hand packaging job was not an “unsuccessful work

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attempt,” the court DENIES Commissioner’s motion for summary judgment. The court

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GRANTS plaintiff’s motion for summary judgment to the extent plaintiff requests a rehearing on

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the issues of (1) whether plaintiff’s work as a hand packager qualifies as an “unsuccessful work

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attempt,” and, if so, (2) is “step five” satisfied, “does the claimant have the residual functional
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capacity to perform any other work?” Lester v. Chater, 81 F.3d at 828 n.5. Pl.’s Mot. Summ. J. at

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6 (requesting rehearing).

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Accordingly, IT IS HEREBY ORDERED that:

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The findings and recommendations filed August 13, 2018 are not adopted;

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The Commissioner’s motion for summary judgment is DENIED, and plaintiff’s

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motion for summary judgment is granted insofar as it requests a rehearing, see ECF No. 20 at 6;

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and

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3.

This matter is remanded to the Commissioner for rehearing on the specific issues

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outlined above. See Sprague v. Bowen, 812 F.2d 1226, 1232 (9th Cir. 1987) (“The decision

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whether to remand a case for additional evidence, or simply to award benefits is within the

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discretion of the court.”).

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DATED: January 24, 2019.

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UNITED STATES DISTRICT JUDGE

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