Ellis v. Commissioner Social Security Administration
Filing
19
OPINION & ORDER: This court REVERSES the Commissioner's final decision and REMANDS this matter pursuant to sentence four of 42 U.S.C. § 405(g) for further proceedings consistent with this opinion and order. See 20-page opinion & order attached. Ordered by Judge Marco A. Hernandez. (mr)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON
PORTLAND DIVISION
DANIEL GENE ELLIS,
Plaintiff,
No. CV-10-6253-HZ
v.
MICHAEL J. ASTRUE, Commissioner,
Social Security Administration,
Defendant.
Kathryn Tassinari
Harder, Wells, Baron & Manning, P.C.
474 Willamette, Suite 200
Eugene, Oregon 97401
Attorney for Plaintiff
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1 - OPINION & ORDER
OPINION & ORDER
Amanda Marshall
UNITED STATES ATTORNEY
District of Oregon
Adrian L. Brown
ASSISTANT UNITED STATES ATTORNEY
1000 S.W. Third Avenue, Suite 600
Portland, Oregon 97204-2902
Kathy Reif
SPECIAL ASSISTANT UNITED STATES ATTORNEY
Office of the General Counsel
Social Security Administration
701 5th Avenue, Suite 2900
Seattle, Washington 98104-7075
Attorneys for Defendant
HERNANDEZ, District Judge:
Plaintiff Daniel Ellis (“Ellis”) brings this action for judicial review of the Commissioner’s
final decision denying his application for Disability Insurance Benefits (“DIB”) under Title II of the
Social Security Act. I have jurisdiction under 42 U.S.C. § 405(g) (incorporated by 42 U.S.C. §
1382(c)(3)). For the following reasons, I REVERSE and REMAND the Commissioner’s decision
for further proceedings.
BACKGROUND
Born in 1961 (Tr. 96), Ellis has a general equivalency degree (Tr. 136) and reports past work
as a logger, heavy equipment repair person, and welder. Tr. 130. Ellis initially alleged disability
since October 7, 2007, due to bipolar disorder, diabetes, lumbar strain, spinal sclerosis, sciatica, and
“possible learning disability.” Tr. 129.
The Commissioner denied Ellis’ applications initially and upon reconsideration (Tr. 58-64),
and an Administrative Law Judge (“ALJ”) held a hearing on January 6, 2010. Tr. 35-57. The ALJ
2 - OPINION & ORDER
found Ellis not disabled on January 25, 2010. Tr. 10-23. The Appeals Council declined review of
the matter on June 18, 2010, making the ALJ’s decision the final decision of the Commissioner. Tr.
1-3.
SEQUENTIAL DISABILITY ANALYSIS
A claimant is disabled if unable to “engage in any substantial gainful activity by reason of
any medically determinable physical or mental impairment which . . . has lasted or can be expected
to last for a continuous period of not less than 12 months[.]” 42 U.S.C. § 423(d)(1)(A). In making
a disability determination, the Commissioner engages in a sequential process encompassing between
one and five steps in determining disability under the meaning of the Act. Bowen v. Yuckert, 482
U.S. 137, 140 (1987); 20 C.F.R. § 404.1520.
At step one, the ALJ determines if the claimant is performing substantial gainful activity.
If he is, the claimant is not disabled. 20 C.F.R. § 404.1520(a)(4)(i). At step two, the ALJ determines
if the claimant has “a severe medically determinable physical or mental impairment” that meets the
twelve month duration requirement. 20 C.F.R. §§ 404.1509; 404.1520(a)(4)(ii). If the claimant does
not have such a severe impairment, he is not disabled. Id.
At step three, the ALJ determines whether the severe impairment meets or equals an
impairment “listed” in the regulations. 20 C.F.R. § 404.1520(a)(4)(iii). If the impairment is
determined to equal a listed impairment, the claimant is disabled.
If adjudication proceeds beyond step three the ALJ must first evaluate medical and other
relevant evidence in assessing the claimant’s residual functional capacity (“RFC”). The claimant’s
RFC is an assessment of work-related activities the claimant may still perform on a regular and
continuing basis, despite limitations imposed by his impairments. 20 C.F.R. § 404.1520(e); Social
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Security Ruling (“SSR”) 96-8p, 1996 WL 374184 (July 2, 1996).
The ALJ uses this information to determine if the claimant can perform his past relevant
work at step four. 20 C.F.R. § 404.1520(a)(4)(iv). If the claimant can perform his past relevant
work, he is not disabled. If the ALJ finds that the claimant’s RFC precludes performance of her past
relevant work, or that the claimant has no past relevant work, the ALJ proceeds to step five.
At step five the Commissioner must determine if the claimant is capable of performing work
existing in the national economy. Yuckert, 482 U.S. at 142; Tackett v. Apfel, 180 F.3d 1094, 1099
(9th Cir 1999); 20 C.F.R. §§ 404.1520(a)(4)(v), 404.1520(f). If the claimant cannot perform such
work, he is disabled. Id.
The initial burden of establishing disability rests upon the claimant. Tackett, 180 F.3d at
1098. If the process reaches step five, the burden shifts to the Commissioner to show that “the
claimant can perform some other work that exists in the national economy, taking into consideration
the claimant’s residual functional capacity, age, education, and work experience.” Id at 1100. If the
Commissioner meets this burden the claimant is not disabled. 20 C.F.R. § 404.1520(g).
THE ALJ’S DECISION
The ALJ found Ellis’ adjustment disorder with depression, bipolar I disorder, personality
disorder, diabetes, lumbar strain, and “status post cervical fusion” “severe” at step two in the
sequential proceedings. Tr. 13. The ALJ found that these impairments did not meet or equal a
disorder listed in the Commissioner’s regulations at step three, and assessed Ellis’ RFC:
[T]he claimant has the residual functional capacity to lift and/or carry
20 pounds occasionally and 10 pounds frequently, stand and/or walk
two hours in an eight hour workday, and sit six hours in an eight hour
workday. He requires the option to change his position from sitting
to standing every 15 to 30 minutes. The claimant is precluded from
climbing ladders, ropes and scaffolds. He can occasionally reach
4 - OPINION & ORDER
overhead, stoop, crouch, and crawl. He should have no more than
occasional contact with the public and coworkers. He should not be
required to work in a team. Tr. 14.
The ALJ found that this RFC did not allow Ellis to perform his past relevant work (Tr. 21), but
found that Ellis could perform work in the national economy at step five. Tr. 22. The ALJ therefore
found Ellis not disabled under the Commissioner’s regulations. Tr. 23.
STANDARD OF REVIEW
The reviewing court must affirm the Commissioner’s decision if the Commissioner applied
proper legal standards and the findings are supported by substantial evidence in the record. 42
U.S.C. § 405(g); Batson v. Comm’r for Soc. Sec. Admin., 359 F.3d 1190, 1193 (9th Cir. 2004).
“Substantial evidence” means “more than a mere scintilla, but less than a preponderance.” Bray v.
Comm’r of the Soc. Sec. Admin., 554 F.3d 1219, 1222 (9th Cir. 2009) (quoting Andrews v. Shalala,
53 F.3d 1035, 1039 (9th Cir. 1995)). It is “such relevant evidence as a reasonable mind might accept
as adequate to support a conclusion.” Id.
This court must weigh the evidence that supports and detracts from the ALJ’s conclusion.
Lingenfelter v. Astrue, 504 F.3d 1028, 1035 (9th Cir. 2007) (citing Reddick v. Chater, 157 F.3d 715,
720 (9th Cir. 1998)). The reviewing court may not substitute its judgment for that of the
Commissioner. Id. (citing Robbins v. Soc. Sec. Admin., 466 F.3d 880, 882 (9th Cir. 2006)); see also
Edlund v. Massanari, 253 F.3d 1152, 1156 (9th Cir. 2001). Variable interpretations of the evidence
are insignificant if the Commissioner’s interpretation is a rational reading. Id.; see also Batson, 359
F.3d at 1193. However, this court cannot now rely upon reasoning the ALJ did not assert in
affirming the ALJ’s findings. Bray, 554 F.3d at 1225-26 (citing SEC v. Chenery Corp., 332 U.S.
194, 196 (1947)); see also Connett v. Barnhart, 340 F.3d 871, 874 (9th Cir. 2003) (citing same).
5 - OPINION & ORDER
DISCUSSION
Ellis asserts that the ALJ erroneously assessed (1) his credibility; (2) the opinions of an
examining and a reviewing physician; and (3) the lay witness testimony. Ellis consequently claims
the ALJ should have found him disabled at step five of the sequential proceedings.
I.
Credibility
Ellis asserts that the ALJ erroneously evaluated his testimony. Pl.’s Opening Br. 19-20.
A.
Credibility Standards
The ALJ must consider all symptoms and pain which “can be reasonably accepted as
consistent with the objective medical evidence, and other evidence.” 20 C.F.R. § 404.1529(a). Once
a claimant shows an underlying impairment which may “reasonably be expected to produce pain or
other symptoms alleged,” absent a finding of malingering, the ALJ must provide “clear and
convincing” reasons for finding a claimant not credible. Lingenfelter, 504 F.3d at 1036 (citing
Smolen v. Chater, 80 F.3d 1273, 1281 (9th Cir. 1996)).
The ALJ’s credibility findings must be “sufficiently specific to permit the reviewing court
to conclude that the ALJ did not arbitrarily discredit the claimant’s testimony.” Orteza v. Shalala,
50 F.3d 748, 750 (9th Cir. 1995) (citing Bunnell v. Sullivan, 947 F.2d 341, 345-46 (9th Cir. 1991)(en
banc)). The ALJ may consider objective medical evidence and the claimant’s treatment history, as
well as the claimant’s daily activities, work record, and observations of physicians and third parties
with personal knowledge of the claimant’s functional limitations. Smolen, 80 F.3d at 1284. The
ALJ may additionally employ ordinary techniques of credibility evaluation, such as weighing
inconsistent statements regarding symptoms by the claimant. Id. The ALJ may not, however, make
a negative credibility finding “solely because” the claimant’s symptom testimony “is not
6 - OPINION & ORDER
substantiated affirmatively by objective medical evidence.” Robbins, 466 F.3d at 883; see also
Bunnell, 947 F.2d at 346-47.
B.
Analysis
The ALJ recited Ellis’ written and hearing testimony in detail (Tr. 15, 20), and discussed
factors pertaining to Ellis’ credibility at several instances in the analysis accompanying his RFC
assessment. Tr. 14-21. This analysis cited Ellis’ activities of daily living, inconsistent statements,
failure to seek treatment, and receipt of unemployment benefits. Tr. 16-21. Ellis challenges the
ALJ’s findings pertaining to each of these. Pl.’s Opening Br. 14-16.
1.
Activities of Daily Living
The ALJ noted Ellis’ own reports of his activities of daily living submitted as part of his DIB
application (Tr. 15), and his reports to examining psychologist James Wahl, Ph.D. Tr. 19. Here the
ALJ cited Ellis’ report that he could attend to his personal care, perform household chores such as
laundry and preparing simple meals, and shop for essentials every three days. Tr. 15. The ALJ also
cited Ellis’ report that he could shop, barbecue, clean his house for hours, bow hunt, and care for two
dogs and two horses (including hauling hay to the horses). Tr. 19. The ALJ concluded that Ellis’
daily activities supported a finding that he was not credible. Tr. 21.
The ALJ may cite a claimant’s activities of daily living in his credibility analysis, Smolen,
80 F.3d at 1284, and may cite such activities in finding them inconsistent with a claimant’s
allegation of total disability. Batson, 359 F.3d at 1196. The record reflects the ALJ’s findings
regarding Ellis’ reports of his daily activities. Tr. 117-24, 263. This court must defer to an ALJ’s
interpretation of a claimant’s daily activities, even where other interpretations more favorable to the
claimant may arise. Rollins v. Massinari, 261 F.3d 853, 857 (9th Cir. 2001). This finding is
7 - OPINION & ORDER
therefore affirmed.
2.
Inconsistent Statements
The ALJ also found numerous inconsistencies in Ellis’ statements throughout the record, and
relied upon these inconsistencies in rejecting Ellis’ symptom testimony. Tr. 20-21. The ALJ may
cite such statements in assessing a claimant’s testimony. Smolen, 80 F.3d at 1284.
a.
Inconsistent Statements Regarding Activities of Daily Living and
Work Activity
The ALJ first discussed Ellis’ inconsistent statements regarding his activities of daily living
to his healthcare providers, noting that Ellis reported that he could not perform any household
chores, but also reported that he was “bored at home because he had already repaired everything he
could and completely cleaned his home to no avail.” Tr. 20. The record shows that on May 9, 2008,
Ellis told Coos County Mental Health (“CCMH”) counselor Cindy Bengtson that “he is getting bored
being home all the time and has fixed everything around the house that is broken.” Tr. 390. This
finding is therefore affirmed.
The ALJ also discussed Ellis’ work activity performed after his October 7, 2007, alleged
onset date at several instances in his decision. Tr. 12, 15-16. The ALJ first found that this effort
constituted “substantial gainful activity”1 under the Commissioner’s regulations, but also found that
it did not occur throughout the adjudicatory period. Tr. 12. The ALJ subsequently referred to Ellis’
report denying that he performed work activity after his alleged onset date (Tr. 15), and Ellis’ work
activity “while dealing with” his leg condition. Tr. 16.
1
To constitute “substantial gainful activity,” the activity must be substantial, involving
significant physical or mental activities, even if done part-time or on a modified schedule. 20
C.F.R. § 404.1572(a). It must also be done for pay or profit. 20 C.F.R. § 404.1572(b).
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The record shows that Ellis consistently reported working at various endeavors to CCMH
counselors throughout the period under review. Tr. 360, 367, 372, 390, 402-04, 412, 420, 423, 439,
441, 457-58, 506-07. The ALJ’s finding that Ellis promulgated inconsistent reports regarding his
work activity is based upon the record and therefore affirmed.
b.
Inconsistent Statements Regarding Medical Symptoms and
Diagnoses
The ALJ also found that Ellis “reported symptoms to one provider, which he denied to
another provider despite almost no time passing between the reports.” Id. The ALJ provided no
further description of this alleged inconsistency, provided no citation for this finding, and the
Commissioner does not presently point to inconsistent reports separated by “almost no time passing.”
Def.’s Br. 6. This court cannot now determine what reports the ALJ referenced. The ALJ’s finding
must be based upon substantial evidence. Batson, 359 F.3d at 1193. Because this court cannot now
make such a determination, this finding is rejected.
The ALJ noted that Ellis reported that he needed to recline throughout the day, but told
Robert Gerber, M.D., that he “did best when he was active,” and reported to CCMH counselors that
he did not have enough to do at home. Tr. 21. The ALJ provided no citation for this statement to
CCMH counselors, the Commissioner does not now point to such a statement in the record, and this
court does not find it in the record. This finding is not supported by the record and therefore not
affirmed.
Finally, the ALJ found that Ellis inconsistently reported facts pertaining to his medical
record. Here the ALJ cited Ellis’ report regarding the source of his leg injury and his alleged
hepatitis C diagnosis. Tr. 21.
The record clearly shows that Ellis’ 2006 leg injury was due to a third-degree cigarette burn,
9 - OPINION & ORDER
subsequent infection, skin grafts, additional infections, and surgery. Tr. 223-33, 315, 322. Ellis’
report that he nearly lost his leg due a work accident contradicts this evidence. The ALJ’s finding
on this matter is therefore affirmed.
A report from treating physician Walter Hunter, M.D.,and CCMH records also indicate that
Ellis carried a hepatitis C diagnosis. Tr. 319, 478, 519. Though the ALJ correctly stated that the
record did not contain diagnostic tests pertaining to this alleged condition, the record does not
support the ALJ’s finding that Ellis inconsistently reported this diagnosis to the ALJ. This finding
is therefore not affirmed.
3.
Failure to Seek Treatment
The ALJ also found that Ellis failed to seek treatment pertaining to his alleged hepatitis C.
Tr. 21. The ALJ subsequently stated that Ellis “alleged these [sic] were somehow related to his lack
of motivation secondary to his mental health issues; however, he admitted that the work he
performed after the alleged onset date was on time and up to par.” Id.
Ellis challenges this reasoning. Pl.’s Opening Br. 16. Ellis is correct in his assertion that the
ALJ’s citation to his mental health and work history is tangential in reference to his hepatitis C.
However, an ALJ may cite a claimant’s failure to seek treatment in finding a claimant not credible.
Smolen, 80 F.3d at 1284. The ALJ’s initial finding on this matter, without reference to Ellis’ mental
health and work history, is therefore affirmed.
4.
Unemployment Insurance
Finally, the ALJ’s credibility analysis discussed Ellis’ receipt of unemployment benefits. Tr.
21. The ALJ reasoned that Ellis represented himself as available for work, which contradicted his
application for disability benefits. Id.
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Receipt of unemployment benefits may undermine a claimant’s alleged inability to work full
time. Carmickle v. Comm’r, Soc. Sec. Admin., 533 F.3d 1155, 1162 (9th Cir. 2008) (citing
Copeland v. Bowen, 861 F.2d 536, 542 (9th Cir. 1988)). This is because unemployment benefit
applications may require that a claimant hold herself out as available for full time work. Copeland,
861 F.2d at 542.
Ellis asserts that Oregon law allows receipt of unemployment benefits if an individual is able
to perform “some” work, which is consistent with the Social Security Administration’s definition
of disability based upon an individual’s inability to perform full time work. Pl’s Opening Br., 16.
The Commissioner responds that Ellis in fact held himself out as unable to perform any work in
conjunction with his disability application, and that this is inconsistent with Ellis’ report that he
could perform “some” work in seeking unemployment benefits. Def.’s Br. 7.
Ellis’ unemployment benefits application is not in the record before this court. The record
presently under review therefore does not establish the manner in which Ellis held himself available
for work. In such circumstances, the court cannot determine that the claimant made an assertion
regarding his availability for work, and an ALJ’s inference on the matter does not constitute a clear
and convincing reason for discrediting a claimant. Carmickle, 533 F.3d at 1162. The ALJ’s finding
on the matter is therefore not affirmed.
C.
Credibility Conclusion
In summary, the ALJ’s citation to Ellis’ activities of daily living, inconsistent statements
regarding his activities and work history, and failure to seek treatment are based upon the record and
appropriate legal standards. This court may affirm an ALJ’s overall credibility conclusion when not
all of the ALJ’s reasons are upheld. Batson, 359 F.3d at 1197. The ALJ’s credibility conclusion is
11 - OPINION & ORDER
therefore affirmed.
II.
Medical Source Statements
Ellis alleges that the ALJ improperly evaluated the opinions of examining physician
Raymond Nolan, M.D., and reviewing psychologist Dorothy Anderson, Ph.D.
A.
Standards: Medical Source Statements
Disability opinions are reserved for the Commissioner. 20 C.F.R. § 404.1527(e)(1). When
making that determination, the ALJ generally must accord greater weight to the opinion of a treating
physician than that of an examining physician. Lester v. Chater, 81 F.3d 821, 830 (9th Cir. 1995).
The ALJ must also generally give greater weight to the opinion of an examining physician over that
of a reviewing physician. Id. If two opinions conflict, an ALJ must give “specific and legitimate
reasons” for discrediting a treating physician in favor of an examining physician. Id. at 830. The
ALJ may reject physician opinions that are “brief, conclusory, and inadequately supported by clinical
findings.” Bayliss v. Barnhart, 427 F.3d 1211, 1216 (9th Cir. 2005).
B.
Examining Physician Dr. Nolan
Ellis asserts that the ALJ failed to fully assess examining physician Dr. Nolan’s opinion
regarding his head and neck limitations. Pl.’s Opening Br. 17.
Dr. Nolan examined Ellis in conjunction with his disability application on May 10, 2008.
Tr. 267-68. Dr. Nolan recorded Ellis’ reported history pertaining to his back and neck impairments,
and performed a clinical examination. Id. Dr. Nolan diagnosed “chronic back pain,” with
nonspecific radicular leg symptoms, and pointedly noted that an MRI study did not correlate this
interpretation. Tr. 268. Dr. Nolan also diagnosed “chronic neck pain syndrome, status post fusion
with limitation of range of motion and presentation compatible with cervical radiculopathy,
12 - OPINION & ORDER
specifically of the arm symptoms associated with lateral bending.” Id. Dr. Nolan concurrently
suggested work-related limitations:
In reference to functional capabilities this man at this point would
want to greatly minimize any bending, twisting and turning and limit
lifting and carrying to no more than 20 pounds. He should avoid
activities with frequent head and neck movement. He should be able
to sit for about six hours in an eight-hour day, with opportunity for
position changes, as needed for comfort. He should be able to stand
and/or walk about two hours. His communication skills are adequate.
Tr. 268.
The ALJ reiterated Dr. Nolan’s clinical findings. Tr. 18. Regarding work restrictions, the
ALJ discussed Dr. Nolan’s lifting restrictions and suggestion that Ellis be allowed to change
positions in the course of the day, and minimize bending, twisting, and turning. Id. The ALJ did
not mention Dr. Nolan’s restriction regarding “frequent head and neck movement.” However, the
ALJ later stated that he accepted all of Dr. Nolan’s work-related restrictions. Tr. 21. Because the
ALJ’s RFC does not cite head and neck limitations (Tr. 14), the ALJ’s cursory statement that he
accepted all of Dr. Nolan’s restrictions is inaccurate.
Neither Ellis nor the Commissioner address the effect of the ALJ’s error regarding Dr.
Nolan’s head and neck limitations. Pl.’s Opening Br. 17; Def.’s Br. 11. The Commissioner instead
points to Tonapetyan v. Halter, 242 F.3d 1144, 1149 (9th Cir. 2001). This citation addresses an
ALJ’s rejection of physician opinions predicated upon reports of a claimant found not credible. Id.
(citing Tonapetyan v. Halter, 242 F.3d 1144, 1149 (9th Cir. 2001). While the ALJ found Ellis not
credible (Tr. 21), he made no finding regarding Ellis’ credibility and Dr. Nolan’s opinion. This court
cannot now rely upon reasoning the ALJ did not assert. Bray, 54 F.3d at 1225-26. The effect of the
ALJ’s omission regarding Dr. Nolan’s restriction is discussed below.
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C.
Reviewing Psychologist Dr. Anderson
Ellis also asserts that the ALJ failed to include all limitations assessed by reviewing
psychologist Dorothy Anderson, Ph.D. Pl.’s Opening Br. 18-19.
Dr. Anderson reviewed Ellis’ medical records for Disability Determination Services (“DDS”)
on May 19, 2008. Tr. 291-93. Dr. Anderson assessed no limitations in Ellis’ understanding and
memory, ability to carry out simple instructions, perform activities within a schedule, sustain an
ordinary routine without special supervision, make simple work-related decisions, sustain
concentration and persistence, ask simple questions or ask for assistance, accept instructions and
respond to workplace criticism, maintain socially appropriate behavior, and adapt appropriately to
work situations. Tr. 291-92. Dr. Anderson found Ellis “moderately” limited in his ability to carry
out detailed instructions, maintain attention and concentration for extended periods, work in
coordination with others without distraction, interact appropriately with the public, and get along
with coworkers. Id.
Following this analysis, Dr. Anderson wrote:
Passive-aggressive/antisocial personality style, some distraction
secondary to discomfort; [claimant] is capable of work in an
environment with restricted/directed social interactions ([claimant]
reports that he works best alone), no more than [occasional] contact
with the general public, he will benefit from regular supervision to
redirect him as necessary and ensure he remains on task. Tr. 293.
The ALJ reiterated Dr. Anderson’s limitations (Tr. 20), and stated that he accepted them. Tr.
21. Ellis now asserts that the ALJ erroneously omitted Dr. Anderson’s opinion that he “would
benefit from regular supervision to redirect him as necessary and ensure he remains on task.” Pl.’s
Opening Br. 18-19. Dr. Anderson did not restrict Ellis to a work environment with “regular
14 - OPINION & ORDER
supervision;” she stated only that such an environment “will” be beneficial (Tr. 293) and that Ellis
did not require “special” supervision. Tr. 291. A plain reading of this language does not establish
that Dr. Anderson restricted Ellis to a work environment with “regular” supervision. Ellis therefore
fails to establish reversible error regarding the ALJ’s omission of this clause.
III.
Lay Testimony
Ellis also asserts that the ALJ erroneously evaluated lay testimony submitted by his girl
friend, Sharon Burcher. Pl.’s Opening Br. 17-18.
A.
Standards: Lay Testimony
The ALJ has a duty to consider lay witness testimony. 20 C.F.R. §§ 404.1513(d),
404.1545(a)(3); Bruce v. Astrue, 557 F.3d 1113, 1116 (9th Cir. 2009). Friends and family members
in a position to observe the claimant's symptoms and daily activities are competent to testify
regarding the claimant's condition. Dodrill v. Shalala, 12 F.3d 915, 918-19 (9th Cir. 1993). The ALJ
may not reject such testimony without comment and must give reasons germane to the witness for
rejecting her testimony. Bruce, 557 F.3d at 1115; Nguyen v. Chater, 100 F.3d 1462, 1467 (9th Cir.
1996).
B.
Analysis
Sharon Burcher completed two “third party report” forms submitted to the record, on
December 15, 2007, and August 23, 2008. Tr. 168-75; 197-204.
On her December 15, 2007 form, Burcher stated that Ellis cares for his dog and pet chicken,
can no longer work or perform many activities, sometimes has trouble dressing himself, and “has
problems with his leg” including circulation and putting on shoes and socks. Tr. 169. Burcher stated
that Ellis can prepare “quick food,” and cannot perform household chores due to back, knee, and leg
15 - OPINION & ORDER
impairments. Tr. 170-71. Ellis is unable to handle a checking or savings account. Tr. 171. His
hobbies include watching movies, fishing, and “work on things.” Tr. 172. Ellis must change
positions “a lot” and fishing is “uncomfortable.” Id. Burcher wrote that Ellis is antisocial, does not
get along well with others, and “authority is a problem.” Tr. 173. Finally, Burcher indicated
limitations in Ellis’ ability to lift, walk, climb stairs, squat, sit, bend, kneel, stand, and reach, and in
talking, memory, completing tasks, concentration, following instructions, using his hands, and
getting along with others. Tr. 173. Burcher stated that Ellis can walk five minutes, and that he does
not follow written instructions. Tr. 173. He uses a sacroiliac joint belt. Tr. 174.
Burcher completed the same form a second time on August 23, 2008. Here she noted similar
activities and limitations, and additionally stated that Ellis does not bathe on a regular basis, won’t
cook, must be asked whether he took his medication daily, will not “take the time” and cannot
concentrate sufficiently to prepare meals, no longer “tinkers” with hobby projects, and cannot
concentrate to watch a full movie. Tr. 198-201. Burcher again stated that Ellis “does not do well”
with others, and additionally indicated limitations in seeing. Tr. 202. She also wrote that Ellis was
fired from jobs because he would scream and yell during episodes associated with his bipolar
disorder. Tr. 203. Finally, Burcher wrote that, as of August 2008, Ellis experiences more manic
episodes due to his bipolar disorder, and additionally has diabetes and hepatitis C. Tr. 204.
The ALJ did not discuss Burcher’s reported observations, but concluded that “Ms. Burcher’s
statements also lack credibility in that she has secondary gain motive behind supporting her live-in
boyfriend’s claim and the extent of limitations she alleged in her reporting has been directly
contradicted by the claimant admittance of his real abilities and limitations. Her observations are
given little, if any, weight.” Tr. 21.
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1.
Secondary Gain
The ALJ may not reject lay testimony simply because the lay witness is an “interested party.”
Valentine v. Comm’r Soc. Sec. Admin., 574 F.3d 685, 694 (9th Cir. 2009). This is because lay
witness testimony derives its value from the witness’ observations of the claimant. Id. While an
ALJ may reject lay testimony if he finds that the lay witness “exaggerated a claimant’s symptoms
in order to get access to his disability benefits, as opposed to being an “interested party” in the
abstract,” the ALJ must explain such findings. Id. (emphasis original). The ALJ presently
articulated no such rationale. The ALJ’s reasoning that Burcher’s testimony should be rejected
because Burcher lives with Ellis and therefore has a “secondary gain motive” is therefore not
affirmed.
2.
Claimant Credibility and Lay Testimony
The ALJ also rejected Burcher’s testimony because he found it contradicted by Ellis’ own
testimony regarding his “real abilities and limitations.” Tr. 21.
The ALJ’s findings regarding Ellis’ activities of daily living and inconsistent statements are
based upon the record. Supra, 8-9. Ellis testified that he could perform some household chores,
shop, barbecue, clean his house, bow hunt, and care for dogs and horses. Tr. 117-24, 263. Burcher
testified that Ellis could not perform household chores, could walk only five minutes, and could not
concentrate well enough to prepare meals. Tr. 199-202. The ALJ’s subsequent rejection of
Burcher’s testimony, to the extent it contradicted Ellis’ testimony regarding his activities of daily
living, constitutes a sufficiently germane reason to reject Burcher’s testimony. This finding is
affirmed.
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3.
RFC Assessment and Lay Testimony
Finally, the Commissioner states that the ALJ accepted Ellis’ limitations regarding his
exertional restrictions expressed in his RFC. Def.’s Br. 9. The Commissioner subsequently asserts
that the ALJ rejected Burcher’s testimony “to the extent” she reported symptoms in excess of these
limitations. Id.
The ALJ must consider lay witness testimony in assessing a claimant’s RFC. 20 C.F.R. §
404.1545(a)(3).
The Commissioner’s assertion that the limitations accepted in Ellis’ RFC
assessment themselves constitute a sufficiently “germane” reason for rejecting Burcher’s testimony
is not sustained.
C.
Conclusion: Lay Testimony
In summary, while the ALJ erred in referring to Burcher’s alleged secondary gain motive in
rejecting her testimony, the ALJ’s remaining findings regarding Burcher’s testimony are adequately
based upon the record. These findings are affirmed.
IV.
Remand
The ALJ erroneously evaluated Dr. Nolan’s opinion regarding Ellis’ head and neck
limitations. The decision whether to remand for further proceedings or for immediate payment of
benefits is within the discretion of the court. Harman v. Apfel, 211 F.3d 1172, 1178 (9th Cir. 2000),
(cert. denied, 531 US 1038 (2000)). The issue turns on the utility of further proceedings. A remand
for an award of benefits is appropriate when no useful purpose would be served by further
administrative proceedings or when the record has been fully developed and the evidence is
insufficient to support the Commissioner’s decision. Strauss v. Comm’r, 635 F.3d 1135, 1138-39
(9th Cir. 2011) (quoting Benecke v. Barnhart, 379 F.3d 587, 593 (9th Cir. 2004)). The court may
18 - OPINION & ORDER
not award benefits punitively, and must conduct a credit-as-true analysis to determine if a claimant
is disabled under the Act. Id. at 1138.
Under the “crediting as true” doctrine, evidence should be credited and an immediate award
of benefits directed where “(1) the ALJ has failed to provide legally sufficient reasons for rejecting
such evidence, (2) there are no outstanding issues that must be resolved before a determination of
disability can be made, and (3) it is clear from the record that the ALJ would be required to find the
claimant disabled were such evidence credited.” Id. The “crediting as true” doctrine is not a
mandatory rule in the Ninth Circuit, but leaves the court flexibility in determining whether to enter
an award of benefits upon reversing the Commissioner’s decision. Connett, 340 F3d at 876 (citing
Bunnell, 947 F.2d at 348). The reviewing court declines to credit testimony when “outstanding
issues” remain. Luna v. Astrue, 623 F.3d 1032, 1035 (9th Cir. 2010).
The ALJ erred by failing to properly address Dr. Nolan’s opinion. The ALJ’s subsequent
RFC assessment and hypothetical questions to the vocational expert at step five in the sequential
disability analysis are therefore not based upon the proper legal standards.
However, it is not clear from the record that crediting the omitted evidence establishes that
Clark is disabled at step five in the sequential proceedings. Neither the ALJ nor Ellis’ counsel asked
the vocational expert to address the effect of the additional head and neck limitations described by
Dr. Nolan. This court therefore has no vocational expert testimony to credit as evidence supporting
a finding of disability at step five in the sequential proceedings.
In such instances, award of benefits is inappropriate. Harman, 211 F.3d at 1180; see also
Luna, 623 F.3d at 1035. The matter must be remanded for further proceedings to address Dr.
Nolan’s head and neck limitations and the lay witness testimony. The ALJ must also clarify the role
19 - OPINION & ORDER
of his finding that Ellis has “moderate” limitations in concentration, persistence, and pace (Tr. 14)
upon Ellis’ RFC. If necessary, the ALJ must then revise his RFC determination. Finally, the ALJ
must make adequate step four and five findings incorporating any revised findings.
CONCLUSION
For these reasons, this court REVERSES the Commissioner’s final decision and REMANDS
this matter pursuant to sentence four of 42 U.S.C. § 405(g) for further proceedings consistent with
this opinion and order.
IT IS SO ORDERED.
Dated this 20th
day of October, 2011.
/s/ Marco A. Hernandez
MARCO A. HERNANDEZ
United States District Judge
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