Yi v. Social Security Administration et al

Filing 17

REPORT AND RECOMMENDATIONS re 14 MOTION to Dismiss filed by Social Security Administration Signed by: Judge Magistrate Judge Stephanie A Gallagher. Signed by Magistrate Judge Stephanie A Gallagher on 12/3/2015. (c/m 12/03/2015 bus, Deputy Clerk)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND

CHONG SU YI,

v.
COMMISSIONER, SOCIAL SECURITY
ADMINISTRATION,
*

*

*

*

*

*

*
*
*
*
*
*
*
*
*
* *

Civil Case No. TDC-15-1453

*

*

*

*

*

*

REPORT AND RECOMMENDATIONS
Pursuant to Standing Order 2014–01, the above-captioned case has been referred to me to
review the parties’ dispositive motions and to make recommendations pursuant to 28 U.S.C. §
636(b)(1)(B) and Local Rule 301.5(b)(ix). Plaintiff Chong Su Yi filed this appeal of the denial
of his claim for disability benefits by the Social Security Administration (“SSA”). The SSA has
filed a Motion to Dismiss for lack of subject matter jurisdiction pursuant to Fed. R. Civ. P.
12(b)(1), on the grounds that Mr. Yi failed to exhaust his administrative remedies prior to filing
his complaint. [ECF No. 14]. I have considered that motion and Plaintiff’s Opposition thereto
[ECF No. 16]. No hearing is deemed necessary. See Local Rule 105.6 (D. Md. 2014). For the
reasons stated below, I recommend that the SSA’s Motion to Dismiss be granted.
I.

Facts
On May 27, 2010, Mr. Yi filed for disability benefits with the SSA. [ECF No. 14-1, ¶

3a]. His claim was denied at the initial level. Id. Mr. Yi filed a new application for disability
benefits on January 7, 2013, and the 2013 claim was again denied initially and on
reconsideration.

[ECF No. 14-1, ¶ 3b].

In the interim, Mr. Yi requested that his 2010

application for benefits be reopened. [ECF No. 14-1, ¶ 3c]. An Administrative Law Judge

(“ALJ”) held a hearing on both the 2010 and 2013 applications, and issued an unfavorable
decision on December 12, 2014.

[ECF No. 14-1, ¶ 3d].

The accompanying “Notice of

Decision” informed Mr. Yi that an appeal had to be filed with the Appeals Council within 60
days of the notice (plus a 5 day grace period for mailing). [ECF No. 14-1, Exh. 1]. Mr. Yi did
not seek an appeal with the Appeals Council, and instead filed this civil action on May 21, 2015.
[ECF No. 14-1, ¶ 3e].
II.

Standard of Review
Motions to dismiss for lack of subject matter jurisdiction are governed by Fed. R. Civ. P.

12(b)(1). While the plaintiff bears the burden of proving that the court has jurisdiction over the
claim or controversy at issue, a 12(b)(1) motion should only be granted if the “material
jurisdictional facts are not in dispute and the moving party is entitled to prevail as a matter of
law.” Ferdinand-Davenport v. Children’s Guild, 742 F. Supp. 2d 772, 777 (D. Md. 2010)
(quoting Evans v. B.F. Perkins Co., a Div. of Standex Int’l Corp., 166 F.3d 642, 647 (4th Cir.
1999)) (citation omitted).

In a motion to dismiss for lack of subject matter jurisdiction, the

pleadings should be regarded as “mere evidence on the issue,” and courts may “consider
evidence outside the pleadings without converting the proceeding to one for summary
judgment.” Evans, 166 F.3d at 647 (quoting Richmond, Fredericksburg & Potomac R. Co. v.
United States, 945 F.2d 765, 768 (4th Cir. 1991)).
III.

Discussion
The SSA contends that this Court does not have jurisdiction over Mr. Yi’s claim because

he failed to exhaust administrative remedies and is not appealing from a “final decision.”
See [ECF No. 14]. Under Social Security Act sections 205(g) and (h), an individual may only
obtain judicial review of the Commissioner’s “final decision” after he has exhausted all

2

administrative remedies. 42 U.S.C. §§ 405(g)-(h). Because there is no formula for determining
whether a decision is final, the meaning of that term is left to federal and state agencies to define
by regulation. Weinberger v. Salfi, 422 U.S. 749, 766 (1975). With respect to Social Security
cases, the Commissioner has set forth administrative procedures which must be exhausted to
achieve a final decision. See 20 C.F.R. §§ 404.900 et seq. and 416.1400 et seq. The final step in
that process is Appeals Council review. See 20 C.F.R. §§ 404.967-83 and §§ 416.1444-65; see
also Bowen v. Yuckert, 482 U.S. 137, 142 (1987) (outlining three-step process for exhausting
administrative remedies, in which the third step is to “seek review by the Appeals Council.”).
The Fourth Circuit has not considered any cases in the exact procedural posture of this
case, where all of the other procedural steps were exhausted but the claimant did not seek
Appeals Council review.

However, the Fourth Circuit has determined that a claimant’s

administrative remedies were not exhausted where she belatedly filed a request for review by the
Appeals Council, and the Appeals Council therefore declined to review her claim. See Adams v.
Heckler, 799 F.2d 131, 133 (4th Cir. 1986) (“We therefore affirm the district court’s conclusion
that no final decision by the Secretary has been presented by the facts herein and thus no
jurisdiction for judicial review of the merits of Adams’ disability claim exists.”). If no final
decision is presented where the Appeals Council is asked belatedly to review a case, then it
follows logically that no final decision is presented where, as here, the Appeals Council is never
asked to perform review. Most other federal courts to have considered this precise issue have
reached the same conclusion, and have determined that a claimant has not exhausted his
administrative remedies if he has failed to seek review by the Appeals Council. See, e.g., Puente
v. Callahan, No. 97-1056, slip op. at 2 (10th Cir. July 18, 1997) (“Examining plaintiff’s SSI
claim under §405(g), we agree that plaintiff failed to exhaust the claim because she did not seek

3

review before the Appeals Council.”); Goff v. Sullivan, No. CV-90-955-MFM, slip op. at 2 (9th
Cir. Sept. 2, 1992) (“Because Goff did not appeal the ALJ’s adverse decision to the Appeals
Council, he failed to exhaust his administrative remedies in a timely manner and could not seek
judicial review in district court.”); Alexander v. Sullivan, Civ. A. No. 92-1950, 1992 WL 315105,
at *1 (E.D. La. Oct. 16, 1992) (“In situations where a claim has proceeded to a hearing before an
administrative law judge and has been denied on the merits, the Secretary’s ‘final decision’
comes only after the claimant has sought review by the Appeals Council.”); Hylton v. Bowen,
No. 87-0091-CV-W-8, 1987 WL 123574, at *3 (W.D. Mo. July 31, 1987) (“Thus, there cannot
be a “final decision” of the Secretary when petitioner has failed to file a timely request for
Appeals Council review as Hylton has failed to do.”); Goodreau v. Bowen, 647 F. Supp. 1409
(W.D. Pa. 1986) (“Review by the Appeals Council is necessary to obtain a ‘final decision’ which
is subject to review.”). In light of the Fourth Circuit’s analysis in Adams and the general
consensus among other federal courts, the law as determined by Congress and the Commissioner
requires Appeals Council review before a “final decision” can be obtained.
Mr. Yi’s opposition to the Commissioner’s motion to dismiss essentially questions the
large number of steps in the administrative process, suggesting that “Plaintiff had at least five
administrative appeals remedy’ (sic) in five plus years.” Pl. Resp. at 2. While Mr. Yi’s
frustration with the length of the administrative process may be understandable, the law permits
the Commissioner to define all of the steps that must be followed to obtain a final decision and to
achieve complete exhaustion of administrative remedies. In this case, because Mr. Yi did not
follow all of the required steps, this Court lacks subject matter jurisdiction to adjudicate his
appeal.

4

CONCLUSION
For the reasons set forth above, I respectfully recommend that:
1.

the Court GRANT Defendant’s Motion to Dismiss [ECF No. 14]; and

2.

the Court close this case.

Any objections to this Report and Recommendations must be served and filed within
fourteen (14) days, pursuant to Federal Rule of Civil Procedure 72(b) and Local Rule 301.5(b).
NOTICE TO PARTIES
Failure to file written objections to the proposed findings, conclusions, and
recommendations of the Magistrate Judge contained in the foregoing report within fourteen (14)
days after being served with a copy of this report may result in the waiver of any right to a de
novo review of the determinations contained in the report, and such failure shall bar you from
challenging on appeal the findings and conclusions accepted and adopted by the District Judge,
except upon grounds of plain error.

Dated: December 3, 2015

/s/
Stephanie A. Gallagher
United States Magistrate Judge

5