Woodard v. Commissioner of Social Security

Filing 29

REPORT AND RECOMMENDATIONS that 23 MOTION for Attorney Fees be denied. Objections due w/in fourteen (14) days. Signed by Magistrate Judge Terence P Kemp on 6/27/2013. (kk2)

IN THE UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF OHIO
EASTERN DIVISION
Nancy S. Woodard,

:

Plaintiff,

:

v.

:

:
Commissioner of Social Security,
Defendant.

Case No. 2:11-cv-1055
JUDGE GREGORY L. FROST
Magistrate Judge Kemp

:

REPORT AND RECOMMENDATION
Plaintiff, Nancy S. Woodard, filed this action seeking review
of a decision of the Commissioner of Social Security denying her
applications for disability insurance benefits and supplemental
security income.

In a decision filed on February 14, 2013, the

Court remanded the case to the Commissioner for further
proceedings.

Plaintiff’s counsel have now filed an application

for attorneys’ fees under the Equal Access to Justice Act, 28
U.S.C. §2412.

Responsive and reply memoranda have been filed,

and the motion is now ready to decide.
I.

Legal Standard

The Equal Access to Justice Act, 28 U.S.C. §2412, provides,
in pertinent part, that the Court shall award to a prevailing
party other than the United States attorneys' fees and expenses
"unless the court finds that the position of the United States
was substantially justified or that special circumstances make an
award unjust."
The party seeking an award of such fees and expenses is
required to submit a fee application to the court within 30 days
of the date that the judgment became final and non-appealable.
The application must demonstrate that the party is a prevailing
party and is eligible to receive a fee award.

It must also

document the amount sought, including an itemized statement from
the attorney or attorneys involved, and must allege that the
position of the United States was not substantially justified.
The court is then required to determine, on the basis of the
record, whether the position of the United States was
substantially justified.

Attorneys' fees are limited to the rate

of $125.00 per hour "unless the court determines that an increase
in the cost of living or a special factor, such as the limited
availability of qualified attorneys for the proceedings involved,
justifies a higher fee."
Once a petition has been filed alleging that the position of
the United States was not substantially justified, the United
States has the burden of demonstrating such justification.

See

Miller v. United States, 831 F. Supp. 1347, 1351 (M.D. Tenn.
1993) ("The burden lies with the government to demonstrate that
its position was substantially justified ...."); Weber v.
Weinberger, 651 F.Supp. 1379, 1388 (E.D. Mich. 1987) ("with
respect to an application for attorney's fees the Government has
the burden of showing that its position was substantially
justified."); see also Howard v. Heckler, 581 F. Supp. 1231, 1233
(S.D. Ohio 1984).

The question of whether the United States’

position is substantially justified is determined based upon the
standards set forth in Pierce v. Underwood, 487 U.S. 552 (1988).
In Pierce, the Court concluded that the phrase "substantially
justified" as used in the EAJA means justified "to a degree that
could satisfy a reasonable person."

Pierce, supra, at 565.

As

the Court noted, that test "is no different from the 'reasonable
basis both in law and fact' formulation adopted by the Ninth
Circuit and the vast majority of other Courts of Appeals that
have addressed this issue."

Id., citing, inter alia, Trident

Marine Construction, Inc. v. District Engineer, 766 F.2d 974 (6th
Cir. 1985). An agency decision that is not supported by
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substantial evidence may still be one that has a reasonable basis
in law and fact.
1989).

Jankovich v. Bowen, 868 F.2d 867 (6th Cir.

Consequently, this Court is required to apply the

"reasonable basis in law and fact" test set forth in Trident
Marine Construction to this application for attorneys’ fees.
II.

The Application for Fees

In this case, two attorneys, Charles E. Binder and Eddy
Pierre Pierre, represented plaintiff.

According to their

application, they expended, in total, 35.5 hours on the case.
They request an award of $6,418.05, plus $550.00 in expenses, for
the time spent, an hourly rate of $180.79.

The bulk of the time

(approximately 25 hours) was spent drafting the statement of
specific errors, and the balance was devoted to filing objections
to the Report and Recommendation (6.6 hours), preparing the fee
petition, and other miscellaneous activities.

Counsel also

attached an assignment of any fee recovery under the EAJA, signed
by the plaintiff, Nancy S. Woodard.
In the response, the Commissioner does not take issue either
with the number of hours spent on the case or the proposed hourly
rate of compensation.

Rather, the Commissioner’s memorandum

identifies a single issue for the Court to decide: “Whether the
Court should deny Plaintiff’s application for attorneys’ fees
because the Commissioner’s position was substantially justified?”
Memorandum in Opposition to Plaintiff’s Motion for Attorney’s
Fees, Doc. 27, at 1.

The Court now turns to this question.
III.

Discussion

A brief review of the case’s procedural history is in order.
Plaintiff had applied for benefits on the basis of disability due
to knee and back problems.

An ALJ credited evidence that she

suffered from severe knee and back impairments but concluded that
she could do a reduced range of sedentary work.

The primary

issue raised by plaintiff’s statement of errors was the ALJ’s
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decision to reject opinions from her treating source, Dr.
Franklin, although plaintiff also raised an issue about the ALJ’s
failure to accept in its entirely the report of Dr. Smith, a
consultative examiner.
In a Report and Recommendation, the undersigned Magistrate
Judge recommended sustaining the Commissioner’s decision.

That

recommendation was based on a finding that Dr. Franklin’s reports
did not really address whether plaintiff had the physical ability
to do jobs other than her prior work as a fast-food restaurant
manager.

The Court also concluded that the ALJ articulated valid

reasons for discounting Dr. Smith’s report to a slight extent.
In sustaining plaintiff’s objections to the Report and
Recommendation, Judge Frost concluded that reasoning process
through which Dr. Franklin’s earlier report was rejected was
“problematic.”

In particular, Judge Frost found that Dr.

Franklin did not, as the first ALJ decision stated, improperly
cite to vocational factors in expressing an opinion about
plaintiff’s functional capacity, and that inconsistencies between
Dr. Franklin’s views and the views of non-treating sources could
not be used to discount his opinion because the later ALJ also
disagreed with the non-treating source opinions.

Judge Frost

also concluded that the ALJ did not explain adequately why he
accepted parts of Dr. Franklin’s opinions but rejected others,
not mentioning limits imposed by Dr. Franklin on plaintiff’s use
of left hand and arm, the need for a sit-stand option, or the
likelihood that plaintiff would miss more than three days of work
per month.

Finally, the Opinion and Order (Doc. 21) noted the

possibility of a closed period of disability, and directed the
Commissioner to assess that issue on remand.

The Commissioner

did not appeal the Court’s decision.
In the memorandum in opposition, the Commissioner argues
that his litigation position was substantially justified because,
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first, the Magistrate Judge accepted that position, and, second,
the only errors found by the District Judge were errors in
articulation, and not substantive errors.

The Commissioner cites

to a number of decisions, such as Anderson v. Comm’r of Social
Security, 1999 WL 1045072 (6th Cir. Nov. 12, 1999) and Stein v.
Sullivan, 966 F.2d 317 (7th Cir. 1992) which, according to the
Commissioner, hold that if there is conflicting evidence on the
issue of disability and remand is ordered only because the ALJ
did not explicitly describe how conflicts in the evidence were
resolved, the Commissioner’s litigation position is substantially
justified.
In reply, plaintiff notes that the mere fact that the
Magistrate Judge accepted the Commissioner’s arguments is not
dispositive of the question of whether they were substantially
justified.

Further, she argues that Anderson and Stein are

distinguishable because the errors found by Judge Frost were not
articulation errors only, but involved a mischaracterization of
the record.

Finally, she points out that the articulation errors

which did occur violated controlling circuit precedent (Wilson v.
Comm’r of Social Security, 378 F.3d 541, 544 (6th Cir. 2004)) as
well as the Commissioner’s own regulations and that the ALJ’s
failure in this regard could not reasonably be defended.
Plaintiff is correct that the mere fact that an
administrative or judicial tribunal accepted the Commissioner’s
position does not immunize the Commissioner from a fee award
under the EAJA.

See, e.g, Patrick V. Shineski, 668 F.3d 1325

(Fed. Cir. 2011).

Rather, the Court must look at both the

agency’s litigation position and the underlying agency decision
in order to determine, as a whole, if the position of the
Commissioner was substantially justified.
Anderson, the primary case relied on by the Commissioner,
held that “[a] reversal of the denial of benefits and a remand

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for further clarification does not automatically mean the
Commissioner's decision to defend the ALJ's decision to deny
benefits was unreasonable.”

Id. at *4.

The converse is not

true, however - that if lack of clarity or articulation of the
Commissioner’s position is the basis of remand, defending the
ALJ’s decision is always substantially justified.

It is

important to remember that Anderson pre-dated Wilson’s
authoritative interpretation of §404.1527 by a number of years,
and Anderson did not involve the same regulation.

Stein also

does not appear to have involved §404.1527 - the remand there was
based on a finding that the ALJ did not “articulate that he
considered all the evidence in the case before arriving at a
decision.”

Id. at 319.

Thus, the issue is not so clear-cut as

the Commissioner contends, and there are decisions from this
Court which have awarded fees under the EAJA precisely because
the ALJ did not articulate with sufficient specificity the
rationale for rejecting a treating source opinion.

See, e.g.,

Woodie v. Astrue, 2008 WL 4878915 (S.D. Ohio Nov. 12, 2008).
Here, it is true that the Court has held that the ALJ did
not properly follow Wilson and §404.1527 by giving adequate
reasons for rejecting the opinions of Drs. Franklin and Smith.
The error was not just one of articulation, however; at least
part of the Court’s decision hinged on the fact that the ALJ (at
least the one who decided the application in the first instance,
and on whose opinion the second ALJ relied) did not cite to
substantial reasons for discounting Dr. Franklin’s opinion - in
other words, his rationale was clearly explained or articulated,
but not supported by substantial evidence.

Again, of course, the

absence of substantial evidence is not the equivalent of the
absence of substantial justification.
The Court also found that portions of the second ALJ’s
decision were erroneous because that decision simply ignored

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specific physical limitations contained in Dr. Franklin’s later
opinion.

That, too, is more than an error in articulation, as is

the failure to offer substantial support for the reasons given
for rejecting Dr. Smith’s conclusion that plaintiff could not
sustain work activities for more than seven hours per day.
But were these conclusions by the ALJ, even if erroneous,
not substantially justified, and was the Commissioner’s decision
to defend them here lacking a reasonable basis in law and fact?
The Court cannot reach that conclusion.

The ALJ did offer a

detailed explanation for his decision, and it did not involve a
total misreading of the record or a total misapplication of the
law.

The Commissioner presented substantial arguments why the

Court should have accepted the ALJ’s findings as being supported
by the record.

They included the fact that the ALJ made a

residual functional capacity finding which was not dramatically
different from Dr. Franklin’s opinion, the fact that plaintiff’s
condition actually improved over time with surgery, and the fact
that she had fairly extensive activities of daily living which
seemed to conflict with Dr. Franklin’s more pessimistic view of
her abilities.
These arguments did not ultimately carry the day, but they
were reasonably grounded in the record and were based on the
Commissioner’s interpretation of how the applicable law applied
to these facts.

This is not a case like Meyers v. Heckler, 625

F.Supp. 228, 235 (S.D. Ohio 1985) where the ALJ “failed to apply
the correct legal standard.”

Rather, the ALJ identified and

attempted to follow that standard, but simply did not marshal
enough support in favor of the result reached.

Under these

circumstances, although the case is admittedly a close one
(primarily, in the Court’s view, due to the second ALJ’s failure
to confront head-on some of the significant limitations found by
Dr. Franklin in his second report), it is not one where an award

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of fees under the EAJA should be made.
IV.

Recommended Decision

For these reasons, it is recommended that the plaintiff’s
motion for an award of fees under the Equal Access to Justice Act
(Doc. 23) be denied.
V. Procedure on Objections
If any party objects to this Report and Recommendation,
that party may, within fourteen (14) days of the date of this
Report, file and serve on all parties written objections to
those specific proposed findings or recommendations to which
objection is made, together with supporting authority for the
objection(s).

A judge of this Court shall make a de novo

determination of those portions of the report or specified
proposed findings or recommendations to which objection is
made.

Upon proper objections, a judge of this Court may

accept, reject, or modify, in whole or in part, the findings
or recommendations made herein, may receive further evidence
or may recommit this matter to the magistrate judge with
instructions.

28 U.S.C. §636(b)(1).

The parties are specifically advised that failure to
object to the Report and Recommendation will result in a
waiver of the right to have the district judge review the
Report and Recommendation de novo, and also operates as a
waiver of the right to appeal the decision of the District
Court adopting the Report and Recommendation.

See Thomas v.

Arn, 474 U.S. 140 (1985); United States v. Walters, 638 F.2d
947 (6th Cir. 1981).

/s/ Terence P. Kemp
United States Magistrate Judge

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