Hinck v. Social Security Administration, Commissioner of
MEMORANDUM AND ORDER - It is ordered that judgment shall be entered pursuant to the fourth sentence of 42 U.S.C. § 405(g) REVERSING the Commissioner's decision, and REMANDING the case for further proceedings consistent with this opinion. Signed by District Judge John W. Lungstrum on 02/27/2015. (ses)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS
JIMMY A. HINCK,
CAROLYN W. COLVIN,
Acting Commissioner of Social Security,
MEMORANDUM AND ORDER
Plaintiff seeks review of a decision of the Commissioner of Social Security
(hereinafter Commissioner) denying Disability Insurance benefits (DIB) and
Supplemental Security Income (SSI) benefits under sections 216(i), 223, 1602, and
1614(a)(3)(A) of the Social Security Act. 42 U.S.C. §§ 416(i), 423, 1381a, and
1382c(a)(3)(A) (hereinafter the Act). Finding a denial of procedural due process, the
court ORDERS that judgment shall be entered pursuant to the fourth sentence of 42
U.S.C. § 405(g) REVERSING the Commissioner’s decision, and REMANDING for
further proceedings consistent with this opinion.
Plaintiff’s history of applications for disability benefits has been long and tortuous
since his first claim was denied in August, 1995. (R. 119). Suffice it to say that
Plaintiff’s most recent proceedings before the Commissioner resulted in the denial of SSI
and SSD benefits by an Administrative Law Judge (ALJ) in a decision issued on August
9, 2013 after remand from this court. (R. 664-76); see also Hinck v. Astrue, Civ. A. No.
11-1061-JWL, 2012 WL 628250 (D. Kan. Feb. 27, 2012). Since Plaintiff did not appeal
the decision after remand to the Appeals Council, and the Council did not take
jurisdiction within 60 days, the ALJ’s decision became the final decision of the
Commissioner after remand, and the court has jurisdiction to review this case. 20 C.F.R.
§§ 404.984, 416.1484. Plaintiff presents many allegations of error in the argument
section of his brief. Among these is the claim that the ALJ entered a Cooperative
Disability Investigations (CDI) report into the administrative record after the ALJ hearing
and relied upon that report in his decision in this case without providing Plaintiff notice of
the report or an opportunity to be heard with regard to the allegations in the report upon
which the ALJ relied. Because the court finds error in this regard which is of
Constitutional proportions, it remands for a new hearing consistent with the requirements
of due process. Plaintiff may make his other arguments regarding error to the
Commissioner on remand.
The court’s review of a decision of the Social Security Administration (SSA) is
guided by the Act. Wall v. Astrue, 561 F.3d 1048, 1052 (10th Cir. 2009). Section 405(g)
of the Act provides that in judicial review “[t]he findings of the Commissioner as to any
fact, if supported by substantial evidence, shall be conclusive.” 42 U.S.C. § 405(g). The
court must determine whether the ALJ’s factual findings are supported by substantial
evidence in the record and whether he applied the correct legal standard. Lax v. Astrue,
489 F.3d 1080, 1084 (10th Cir. 2007); accord, White v. Barnhart, 287 F.3d 903, 905 (10th
Cir. 2001). Substantial evidence is more than a scintilla, but it is less than a
preponderance; it is “such relevant evidence as a reasonable mind might accept as
adequate to support a conclusion.” Richardson v. Perales, 402 U.S. 389, 401 (1971); see
also, Wall, 561 F.3d at 1052; Gossett v. Bowen, 862 F.2d 802, 804 (10th Cir. 1988).
The court may “neither reweigh the evidence nor substitute [its] judgment for that
of the agency.” Bowman v. Astrue, 511 F.3d 1270, 1272 (10th Cir. 2008) (quoting
Casias v. Sec’y of Health & Human Servs., 933 F.2d 799, 800 (10th Cir. 1991)); accord,
Hackett v. Barnhart, 395 F.3d 1168, 1172 (10th Cir. 2005). Nonetheless, the
determination whether substantial evidence supports the Commissioner’s decision is not
simply a quantitative exercise, for evidence is not substantial if it is overwhelmed by
other evidence or if it constitutes mere conclusion. Gossett, 862 F.2d at 804-05; Ray v.
Bowen, 865 F.2d 222, 224 (10th Cir. 1989).
Denial of Due Process
Plaintiff’s last hearing before an ALJ was held in Topeka, Kansas on March 26,
2013. (R. 664, 688-726). Plaintiff appeared and testified, and was represented at the
hearing by counsel in this case. (R. 688). At the hearing, medical exhibits B-1F through
B-60F were admitted into evidence. (R. 693). Plaintiff testified that he was interested in
hunting and in 2007 and 2008 he had organized some hunting trips wherein he would
make the preparations and get the hunters started, but that “[m]ainly they would always
hunt on their own.” (R. 702). He testified that he had not spent as much time on it
recently. (R. 703). He testified that the only equipment he takes on his hunting trips is
pop-up blinds that weigh about four or five pounds and that he just drives the participants
right up to the timber, sets up the blinds, and picks them up at the timber when the hunt is
over. (R. 715-16).
On March 29, 2013, the Kansas City CDI Unit received a referral from the Topeka
ODAR (Office of Disability Adjudication and Review) to investigate how much the
claimant is involved in the hunting business. (R. 1456). A report of the investigation was
prepared on May 2, 2013, and appears in the record as Exhibit B61F. (R. 1454-64). In
his decision, dated August 9, 2013, the ALJ stated that the “claimant has been seen
performing heavy lifting, walking long distances over rough terrain, and doing bending,
stooping, and crawling,” information which was included in the CDI report. (R.673).
The ALJ also cited to the CDI report, noting that Plaintiff runs a hunting guide business
with his son, recently made a hunting trip to Colorado in which he went horseback riding,
“bagged a bull elk, and carried the elk’s head and rack out of the woods on his back.” (R.
673). He noted that the report indicated that people who knew Plaintiff for years had
never known him to have back problems or problems with walking, and indicated that
Plaintiff “was able to walk miles through fields and pasturelands carrying buckets of corn,
crawling under gates and climbing over gates and fences,” and was able to “climb up and
hang turkeys from wires attached to beams.” (R. 673).
Plaintiff argues that the CDI report was improperly admitted after the hearing, was
never proffered to Plaintiff for comment or explanation, and he was never given the
opportunity to cross-examine the alleged witnesses. He argues that these fact constitute
both a denial of due process and a violation of the SSA’s Hearings, Appeals, and
Litigation Law Manual (HALLEX). He argues that the HALLEX manual requires the
ALJ to notify the claimant if new evidence is being developed, reopen the record if
additional evidence is to be received, and allow the claimant to refute the evidence,
submit additional evidence, request a supplemental hearing, or to cross-examine
witnesses. (Pl. Br. 24-25).
Plaintiff next argues that reliance on a post-hearing report to deny Social Security
benefits constitutes a denial of due process if the ALJ fails to notify the claimant of the
new evidence, and fails to provide an opportunity to be heard to deny or refute the
evidence. (Pl. Br. 25-26) (citing Gullo v. Califano, 609 F.2d 649, 650 (2d Cir. 1979), and
quoting Allison v. Heckler, 711 F.2d 145, 146-47 (10th Cir. 1983)).
The Commissioner states that the error of which Plaintiff complains is a violation
of his due process rights under the HALLEX Manual, and argues that in order to benefit
from such an error, Plaintiff must articulate prejudice flowing from the failure to follow
HALLEX procedures. She argues that Plaintiff cannot show such prejudice because SSA
is permitted to conduct fraud investigations and because the information in the CDI report
is “consistent with Plaintiff’s own statements and the other evidence of record.”
(Comm’r Br. 12).
The court disagrees with the Commissioner. The prejudice of which Plaintiff
complains is the very heart of due process. The Commissioner made a decision based
upon information of which Plaintiff was not informed and to which Plaintiff was not
permitted to object, refute, correct, or otherwise respond. If such is permitted, there is no
reason to allow a claimant to appear, testify, or provide evidence in any disability hearing.
If the information in the CDI report were identical to Plaintiff’s testimony at the hearing
or to the other evidence in the record, Plaintiff would have no basis to complain because
he was afforded notice of the other evidence in the record and had already availed himself
of the opportunity to be heard on that evidence. But, it is fundamentally unfair to
blindside a claimant and make a decision regarding benefits based upon information the
existence of which he is unaware and of which he has been effectively prohibited from
refuting. While disability benefits are not a constitutional right, and their provision is a
creature of statute, “the ‘right’ to Social Security benefits is in one sense ‘earned.’”
Flemming v. Nestor, 363 U.S. 603, 610 (1960). And, “[n]o person shall be . . . deprived
of life, liberty, or property, without due process of law.” U.S. Const., amend. V.
Procedural due process is of Constitutional proportions, and the court need not look to the
HALLEX manual to determine that it has been denied in the circumstances of this case.
Adjudicative proceedings before the Commissioner are subject to procedural due
process considerations. Perales, 402 U.S. at 401-02. The question, then, is what
procedural due process requires with respect to evidence admitted into the record after a
hearing has been completed. As Plaintiff’s Brief suggests, in 1979 the Second Circuit
decided that it was a denial of due process for an ALJ to accept a medical report into the
record after a hearing and to rely upon that report to find no disability without offering the
claimant an opportunity to examine or challenge the report prior to the decision denying
the claim. Gullo, 609 F.2d at 650.
In 1983, the Tenth Circuit reached the same conclusion in Allison, 711 F.2d at
147. That court based its decision in part on the fact that the Act requires “reasonable
notice and opportunity for a[n ALJ] hearing” after a decision denying disability at the
agency level. Id. (quoting 42 U.S.C. § 405(b)(1)). The court went on to note that the
Commissioner “is clearly mandated by statute to determine a claimant’s disability “on the
basis of evidence adduced at the hearing.” Id. (quoting 42 U.S.C. § 405(b)(1)). In a
footnote, the court rejected the SSA’s argument that the regulations allow a decision to be
made “based on evidence offered at the hearing or otherwise included in the record.” Id.
n.2. (quoting 20 C.F.R. § 404.953(a) (1982)1) (emphasis added). The court explained, “a
federal regulation may not be interpreted in a manner at odds with the [Commissioner’s]
statutory authority and the Constitution. If the ALJ’s decision is based on evidence
‘otherwise included in the record,’ the regulation must be construed to require that this
evidence be gathered and presented to the claimant prior to the hearing.” Allison, 711
F.2d at 147.
The current regulation includes language identical to that quoted above.
The court sees no reasonable basis to distinguish Allison from this case. The fact
that Allison concerned the report of a consultative examination performed after the
hearing, whereas this case concerns the report of an investigation completed after the
hearing is of no import to the due process right at issue here. In fact, in Allison, the
plaintiff was aware that a report was forthcoming because after the hearing she had been
sent to the physician for a consultative examination, and it could be argued that she
should have asked for a copy of the report, and affirmatively sought an opportunity to
respond. Here, on the other hand, Plaintiff had no reason to know that an investigation
was taking place, and knew nothing of the matter until after the decision was issued.
Moreover, the regulations support the court’s interpretation because they provide
that an “Administrative Law Judge may also reopen the hearing at any time before he or
she mails a notice of the decision in order to receive new and material evidence.” 20
C.F.R. §§ 404.944, 416.1444. Here, the hearing had been closed for more than a month
when the ALJ accepted the report into the administrative record, but he did not reopen the
hearing. Because a party must affirmatively waive appearance at a hearing, the court
concludes that the claimant must be given the opportunity to appear or to waive his
appearance at a reopened hearing. Id. §§ 404.948(b), 404.950, 416.948(b), 416.950.
The ALJ’s acceptance of the CDI report, and his reliance upon that report without
first providing notice to plaintiff, and an opportunity to be heard on the issue, constitutes
a denial of procedural due process, and requires remand for a hearing at which Plaintiff
may refute, explain, deny, or rebut the CDI report. Relying on Allison, Plaintiff suggests
that the court should order the Commissioner to allow him to subpoena and crossexamine the CDI investigators and witnesses. The court acknowledges that subpoenas
and cross-examinations may be a basis to refute or rebut the report, but also notes that it
may be inappropriate in the circumstances to require a mini-trial on an investigative
report within a disability hearing. Moreover, the regulations provide for subpoenas and
cross-examination in appropriate circumstances, and the court believes the better
approach is to allow the Commissioner to make such decisions in the first instance. Id.
§§ 404.950, 416.1450. After the Commissioner considers and decides those issues and
makes her final decision after remand, Plaintiff may seek judicial review if he believes he
did not receive the process due under the circumstances.
IT IS THEREFORE ORDERED that judgment shall be entered pursuant to the
fourth sentence of 42 U.S.C. § 405(g) REVERSING the Commissioner’s decision, and
REMANDING the case for further proceedings consistent with this opinion.
Dated this 27th day of February 2015, at Kansas City, Kansas.
s:/ John W. Lungstrum
John W. Lungstrum
United States District Judge
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?