Gray v. Commissioner Social Security Administration
Opinion and Order - Because Ms. Gray has identified harmful error in the ALJ's assessment of the medical opinions of record and her symptom allegations, which resulted in an erroneous RFC formulation and subsequent error at step five, the Commis sioner's decision is not based on proper legal standards or supported by substantial evidence. Therefore, Ms. Gray's request for remand (ECF 1 ) is GRANTED. The Commissioner's decision is REVERSED, and this case is REMANDED for immediate calculation and payment of benefits beginning on October 16, 2010. Signed on 2/9/2018 by Judge Michael H. Simon. (mja)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON
DEBORAH J. GRAY,
Case No. 6:17-cv-43-SI
OPINION AND ORDER
NANCY A. BERRYHILL,
Commissioner of Social Security,
Drew L. Johnson and Sherwood J. Reese, DREW L. JOHNSON PC, 1700 Valley River Drive,
Eugene, OR 97401. Of Attorneys for Plaintiff.
Billy J. Williams, United States Attorney, and Renata Gowie, Assistant United States Attorney,
UNITED STATES ATTORNEY’S OFFICE, DISTRICT OF OREGON, 1000 SW Third Avenue, Suite 600,
Portland, OR 97204; Martha A. Boden, Special Assistant United States Attorney, OFFICE OF THE
GENERAL COUNSEL, SOCIAL SECURITY ADMINISTRATION, 701 Fifth Avenue, Suite 2900
M/S 221A, Seattle, WA 98104. Of Attorneys for Defendant.
Michael H. Simon, District Judge.
Deborah Gray seeks judicial review of the final decision of the Commissioner of the
Social Security Administration (“Commissioner”) denying her applications for Disability
Insurance Benefits (“DIB”) and Supplemental Security Income (“SSI”). Because the
Commissioner’s decision was not based on the proper legal standards and the findings were not
supported by substantial evidence, the decision is REVERSED and REMANDED for immediate
payment of benefits.
PAGE 1 – OPINION AND ORDER
STANDARD OF REVIEW
The district court must affirm the Commissioner’s decision if it is based on the proper
legal standards and the findings are supported by substantial evidence. 42 U.S.C. § 405(g); see
also Hammock v. Bowen, 879 F.2d 498, 501 (9th Cir. 1989). “Substantial evidence” means
“more than a mere scintilla but less than a preponderance.” Bray v. Comm’r of Soc. Sec.
Admin., 554 F.3d 1219, 1222 (9th Cir. 2009) (quoting Andrews v. Shalala, 53 F.3d 1035, 1039
(9th Cir. 1995)). It means “such relevant evidence as a reasonable mind might accept as adequate
to support a conclusion.” Id. (quoting Andrews, 53 F.3d at 1039).
Where the evidence is susceptible to more than one rational interpretation, the
Commissioner’s conclusion must be upheld. Burch v. Barnhart, 400 F.3d 676, 679 (9th
Cir. 2005). Variable interpretations of the evidence are insignificant if the Commissioner’s
interpretation is a rational reading of the record, and this Court may not substitute its judgment
for that of the Commissioner. See Batson v. Comm’r of Soc. Sec. Admin., 359 F.3d 1190, 1193,
1196 (9th Cir. 2004). “[A] reviewing court must consider the entire record as a whole and may
not affirm simply by isolating a specific quantum of supporting evidence.” Orn v. Astrue, 495
F.3d 625, 630 (9th Cir. 2007) (quoting Robbins v. Soc. Sec. Admin., 466 F.3d 880, 882 (9th
Cir. 2006) (quotation marks omitted)). A reviewing court, however, may not affirm the
Commissioner on a ground upon which the Commissioner did not rely. Id.; see also Bray, 554
F.3d at 1226.
Ms. Gray filed applications for DIB and SSI in March 2010, alleging disability as of
June 25, 2008. AR 93. The claims were denied initially and upon reconsideration, and Ms. Gray
PAGE 2 – OPINION AND ORDER
did not timely file a request for hearing. AR 11. In May 2011, Ms. Gray applied for DIB and SSI,
again alleging an onset date of June 25, 2008. AR 118, 200-01. The applications were denied
initially and on reconsideration, and this time Ms. Gray timely requested hearing before an
Administrative Law Judge (“ALJ”), which was held on June 13, 2013. AR 30-91. After the
hearing, ALJ Elizabeth Watson found Ms. Gray not disabled in a decision dated June 27, 2013.
AR 11-21. After the Appeals Council rejected Ms. Gray’s request for review, she filed an action
in this court, Gray v. Comm’r Soc. Sec. Admin., Case No. 6:14-cv-01552-BR. In that action, the
parties stipulated to remand the case for further proceedings to reconsider the opinions of Sharon
Beickel, Ph.D., and state agency physician Joshua Boyd, which ALJ Watson did not consider in
her decision. AR 626-27, 639-40. A second hearing was convened on remand on May 25, 2016,
this time before ALJ Ted W. Neiswanger. AR 562-600. In a decision dated September 15, 2016,
an ALJ again found that Ms. Gray was not disabled. AR 539-551. The decision became the final
decision of the Commissioner when the Appeals Council declined to assume jurisdiction of the
remanded case on its own motion. See 20 C.F.R. § 404.984(c)-(d). Ms. Gray now seeks review in
Born in August 1961, Ms. Gray was 46 years old on the alleged disability onset date
and 54 at the time of the second administrative hearing. AR 92. She speaks English, and stated
she attended school through the ninth grade, but did not obtain a GED. AR 35, 214. She alleges
disability due to: degenerative disc disease of the lumbar spine, depression, tendonitis, and
chronic obstructive pulmonary disease (“COPD”). AR 104.
The Sequential Analysis
A claimant is disabled if he or she is unable to “engage in any substantial gainful activity
by reason of any medically determinable physical or mental impairment which . . . has lasted or
PAGE 3 – OPINION AND ORDER
can be expected to last for a continuous period of not less than 12 months[.]” 42 U.S.C.
§ 432(d)(1)(A). “Social Security Regulations set out a five-step sequential process for
determining whether an applicant is disabled within the meaning of the Social Security Act.”
Keyser v. Comm’r Soc. Sec. Admin., 648 F.3d 721, 724 (9th Cir. 2011); see also 20 C.F.R.
§ 404.1520; Bowen v. Yuckert, 482 U.S. 137, 140 (1987). Each step is potentially dispositive. 20
C.F.R. § 404.1520(a)(4). The five-step sequential process asks the following series of questions:
Is the claimant performing “substantial gainful activity?” 20 C.F.R. §
404.1520(a)(4)(i). This activity is work involving significant mental or
physical duties done or intended to be done for pay or profit. 20 C.F.R. §
404.1510. If the claimant is performing such work, she is not disabled
within the meaning of the Act. 20 C.F.R. § 404.1520(a)(4)(i). If the
claimant is not performing substantial gainful activity, the analysis
proceeds to step two.
Is the claimant’s impairment “severe” under the Commissioner’s
regulations? 20 C.F.R. § 404.1520(a)(4)(ii). An impairment or
combination of impairments is “severe” if it significantly limits the
claimant’s physical or mental ability to do basic work activities. 20 C.F.R.
§ 404.1521(a). Unless expected to result in death, this impairment must
have lasted or be expected to last for a continuous period of at least 12
months. 20 C.F.R. § 404.1509. If the claimant does not have a severe
impairment, the analysis ends. 20 C.F.R. § 404.1520(a)(4)(ii). If the
claimant has a severe impairment, the analysis proceeds to step three.
Does the claimant’s severe impairment “meet or equal” one or more of the
impairments listed in 20 C.F.R. Part 404, Subpart P, Appendix 1? If so,
then the claimant is disabled. 20 C.F.R. § 404.1520(a)(4)(iii). If the
impairment does not meet or equal one or more of the listed impairments,
the analysis continues. At that point, the ALJ must evaluate medical and
other relevant evidence to assess and determine the claimant’s “residual
functional capacity” (“RFC”). This is an assessment of work-related
activities that the claimant may still perform on a regular and continuing
basis, despite any limitations imposed by his or her impairments. 20
C.F.R. §§ 404.1520(e), 404.1545(b)-(c). After the ALJ determines the
claimant’s RFC, the analysis proceeds to step four.
Can the claimant perform his or her “past relevant work” with this RFC
assessment? If so, then the claimant is not disabled. 20 C.F.R.
PAGE 4 – OPINION AND ORDER
§ 404.1520(a)(4)(iv). If the claimant cannot perform his or her past
relevant work, the analysis proceeds to step five.
Considering the claimant’s RFC and age, education, and work experience,
is the claimant able to make an adjustment to other work that exists in
significant numbers in the national economy? If so, then the claimant is
not disabled. 20 C.F.R. §§ 404.920(a)(4)(v), 404.1560(c). If the claimant
cannot perform such work, he or she is disabled. Id.
See also Bustamante v. Massanari, 262 F.3d 949, 954 (9th Cir. 2001).
The claimant bears the burden of proof at steps one through four. Id. at 953; see also
Tackett v. Apfel, 180 F.3d 1094, 1100 (9th Cir. 1999); Yuckert, 482 U.S. at 140-41. The
Commissioner bears the burden of proof at step five. Tackett, 180 F.3d at 1100. At step five, the
Commissioner must show that the claimant can perform other work that exists in significant
numbers in the national economy, “taking into consideration the claimant’s residual functional
capacity, age, education, and work experience.” Id.; see also 20 C.F.R. § 404.1566 (describing
“work which exists in the national economy”). If the Commissioner fails to meet this burden, the
claimant is disabled. 20 C.F.R. § 404.1520(a)(4)(v). If, however, the Commissioner proves that
the claimant is able to perform other work existing in significant numbers in the national
economy, the claimant is not disabled. Bustamante, 262 F.3d at 953-54; Tackett, 180 F.3d
The ALJ’s Decision
The ALJ performed the sequential analysis. At step one, the ALJ found Ms. Gray met the
insured status requirements for DIB through December 31, 2013, and had not engaged in
substantial gainful activity since the alleged onset date, July 25, 2008. AR 541. At step two, the
ALJ concluded that Ms. Gray had the following severe impairments: degenerative disc disease
and degenerative joint disease of the lumbar spine; depression related to chronic pain; COPD;
and “an alcohol use disorder in remission since 2012.” Id. At step three, the ALJ determined that
PAGE 5 – OPINION AND ORDER
Ms. Gray did not have an impairment or combination of impairments that met or equaled a listed
impairment. AR 542.
The ALJ next assessed Ms. Gray’s RFC and found that she could perform light work with
the following caveats: she can lift 20 pounds occasionally and ten pounds frequently; sit, stand,
and walk for six hours in an eight-hour day; occasionally push and pull with the right upper
extremity; occasionally climb ramps and stairs, but never ladders, ropes, or scaffolds;
occasionally balance, stoop, kneel, crouch, and crawl; must avoid even moderate exposure to
hazards; can understand only simply instructions; can perform only simple, routine work tasks
consistent with a General Educational Development (“GED”) reasoning level of two and a
Specific Vocational Preparation (“SVP”) level of two. AR 544; see Dictionary of Occupation
Titles (“DOT”), available at 1991 WL 645958 (4th ed. 1991).
At step four, the ALJ found that Ms. Gray could not perform her past relevant work of
clothing sorter or home attendant. AR 549. At step five, the ALJ concluded that Ms. Gray could
perform jobs that exist in significant numbers in the national economy, including electronics
worker, laundry articles sorter, and router clerk. AR 549-50. Accordingly, the ALJ found Ms.
Gray not disabled. AR 550-51.
Ms. Gray contends the ALJ made the following legal errors in evaluating her case: (1)
failing to properly consider and incorporate the medical opinions of several providers; (2) failing
to provide legally sufficient reasons to discredit Ms. Gray’s symptom testimony; and (3) failing
to carry the burden of proof by identifying other work Ms. Gray is capable of performing; and, in
the alternative; (4) that the ALJ erred by failing to order further consultative examinations.
Medical Opinion Evidence
PAGE 6 – OPINION AND ORDER
The ALJ is responsible for resolving conflicts in the medical record, including conflicting
physicians’ opinions. Carmickle v. Comm’r, Soc. Sec. Admin., 533 F.3d 1155, 1164 (9th Cir.
2007). The Ninth Circuit distinguishes between the opinions of three types of physicians: treating
physicians, examining physicians, and non-examining physicians. The opinions of treating
physicians are generally accorded greater weight than the opinions of non-treating physicians.
Lester v. Chater, 81 F.3d 821, 830 (9th Cir. 1995). A treating doctor’s opinion that is not
contradicted by the opinion of another physician can be rejected only for “clear and convincing”
reasons. Baxter v. Sullivan, 923 F.2d 1391, 1396 (9th Cir. 1991).
If a treating doctor’s opinion is contradicted by the opinion of another physician, the ALJ
must provide “specific, legitimate reasons” for discrediting the treating doctor’s opinion. Murray
v. Heckler, 722 F.2d 499, 502 (9th Cir. 1983). Additionally, the ALJ must accord greater weight
to the opinion of an examining physician than that of a non-examining physician. Lester, 81 F.3d
at 830. As is the case with a treating physician’s opinion, the ALJ must provide “clear and
convincing” reasons for rejecting the uncontradicted opinion of an examining physician. Pitzer v.
Sullivan, 908 F.2d 502, 506 (9th Cir. 1990). If the opinion of an examining physician is
contradicted by another physician’s opinion, the ALJ must provide “specific, legitimate reasons”
for discrediting the examining physician’s opinion. Lester, 81 F.3d at 830. Specific, legitimate
reasons for rejecting a physician’s opinion may include its reliance on a claimant’s discredited
subjective complaints, inconsistency with the medical records, inconsistency with a claimant’s
testimony, or inconsistency with a claimant’s ADLs. Tommasetti, 533 F.3d at 1040. It is error to
ignore an examining physician’s medical opinion without providing reasons for doing so; an ALJ
effectively rejects an opinion when he ignores it. Smolen, 80 F.3d at 1286.
PAGE 7 – OPINION AND ORDER
Ms. Gray argues that although the ALJ purported to accord “substantial weight” to state
agency psychologist Dorothy Anderson, Ph.D., the ALJ failed to incorporate some of
Dr. Anderson’s assessed limitations into the RFC. Specifically, Dr. Anderson opined that Ms.
Gray “is capable of brief structured routine interactions with the public but is limited to areas that
do not demand frequent unstructured or persuasive public communications. [She] would benefit
from work that does not require tasks that require [sic] interaction or close coordination with coworkers.” AR 411. Ms. Gray notes that at the first administrative hearing, when the ALJ
included in the hypothetical questions a limitation to only occasional interaction with the public
and coworkers, the VE was unable to identify any light or sedentary jobs Ms. Gray would be
able to perform. AR 82, 85-86. Accordingly, argues Ms. Gray, the social interaction limitation is
material and should have been included in the second RFC formulated by the second ALJ and in
hypotheticals at the hearing on remand.
The Commissioner concedes that Dr. Anderson’s assessed limitations should have been
included in the RFC, but that any error was harmless because the jobs the ALJ ultimately
identified at step five require no “significant dealings” with people. Def.’s Br. at 5-6 (citing
Molina v. Astrue, 674 F.3d 1104, 1115 (9th Cir. 2012) (remand is not required to address
inconsequential ALJ error)). Although the Commissioner identifies the DOT codes for the jobs
of laundry sorter, electronics worker, and router clerk, no further information is provided in
support of the Commissioner’s argument, aside from the conclusory assertion that these jobs
“accommodated” the social limitations set forth by Dr. Anderson. As Ms. Gray accurately points
out, however, the VE at the initial hearing noted that there were no light or sedentary jobs
available for claimants with limitations to simple tasks and only occasional interaction with
PAGE 8 – OPINION AND ORDER
others.1 AR 82, 85-86. The Commissioner’s argument is undermined by the VE testimony at the
initial hearing. Therefore, based on the record before the Court, omitting Dr. Anderson’s
assessed social interaction limitations was not inconsequential to the ultimate non-disability
decision. Remand is appropriate.
Ms. Gray argues the ALJ erred in evaluating medical opinion testimony provided by
DeWayde Perry, M.D., following consultative examinations in 2009 and 2011. In 2009,
Dr. Perry opined that Ms. Gray could be expected to stand and walk for up to four hours of an
eight-hour workday, while Dr. Perry doctor opined in 2011 that Ms. Gray could stand and walk
for up to six hours. AR 352, 459. The ALJ accorded “substantial weight” to the 2011 assessment,
but gave “less weight” to the 2009 assessment because it was “an underestimate of the
claimant[‘s] overall level of functioning.” AR 547. Aside from the different stand/walk
limitation, however, Dr. Perry’s assessments were essentially identical. Compare AR 349-53
with AR 455-60.
The Commissioner argues that the ALJ did not err; rather, the ALJ appropriately found
that Dr. Perry’s “detailed observations” were supported by the record as a whole, and moreover,
as Dr. Perry stated in his 2011 opinion, his “findings were inconsistent with [Ms. Gray’s]
complaints of severe back pain.” AR 459, 547. The Commissioner further argues that the ALJ
identified specific evidence in support of his assessment, noting relatively unremarkable findings
by Dr. Perry in both consultative exams, aside from complaints of severe pain. As Dr. Perry’s
reports bear out, however, the same clinical testing was done in both 2009 and 2011, with nearly
At the second hearing, the VE was not asked a hypothetical question that included the social
limitations at issue.
PAGE 9 – OPINION AND ORDER
identical results. The only difference is that in 2009, Dr. Perry assessed a four-hour stand/walk
limitation, while in 2011 he used the same information to assess a six-hour stand/walk limitation.
Although the ALJ was within his authority to choose which of the stand/walk limitations was
better supported, the ALJ was compelled to provide a specific and legitimate reason to reject one
conclusion over the other. Lester, 81 F.3d at 830. Instead, the ALJ only gave the conclusory
statement that the 2009 assessment was an “underestimate” of Ms. Gray’s “overall level of
functioning.” AR 547. Because the ALJ did not provide a legally sufficient basis for rejecting the
earlier report, the ALJ erred.
Mary E. Gabriele, M.D. treated Ms. Gray from 2009 through June 2015. AR 533. She
provided two medical opinion letters in support of Ms. Gray’s claim, one in April 2013, and
another in May 2013. AR 486, 533. In the April letter, Dr. Gabriele explained that she treated
Ms. Gray for chronic back pain with methodone and norco, that she was informed by Ms. Gray
that a surgeon felt her back was not operable, that there was no recent medical imagining of
Ms. Gray’s back, and that her pain caused substantial functional limitation. AR 486. The
following month, Dr. Gabriele wrote a second letter, explaining that an MRI of Ms. Gray’s
lumbar spine had been performed in the interim that revealed degenerative changes and
supported allegations of ongoing pain and disability. AR 533. In both letters, Dr. Gabriele added
that Ms. Gray likely has psychological or cognitive limitations as well, but the doctor did not
have sufficient information to form an opinion on the issue. AR 486, 533. The ALJ accorded
“little weight” to the doctor’s opinions, stating that they were “poorly explained,” and because
they were “based on limited objective information,” it suggested Dr. Gabriele’s assessments
were primarily based on subjective complaints. AR 548.
PAGE 10 – OPINION AND ORDER
Ms. Gray’s first assignment of error is that the ALJ failed to consider the appropriate
regulatory factors for weighing treating physician opinions. Ms. Gray specifically argues that
recent Ninth Circuit precedent established that an ALJ’s failure to consider length of treating
relationship, frequency of medical examinations, nature and extent of treatment relationship
constitutes reversible error. Trevizo v. Berryhill, 871 F.3d 664, 676 (9th Cir. 2017) (as amended)
(citing 20 C.F.R. § 404.1527(c)(2)-(6)). Indeed, the ALJ did not explicitly recognize that
Dr. Gabriele was Ms. Gray’s treating physician, nor did he evaluate the nature, length, and extent
of the doctor’s treatment relationship.2 AR 544. Thus, the ALJ erred. Trevizo, 871 F.3d at 676.
Moreover, the ALJ’s assertion that Dr. Gabriele’s opinion was not supported by the
objective medical record is contradicted by the record. As the doctor’s second letter explained,
Ms. Gray’s back pain complaints were substantiated by the MRI results, which demonstrated
“severe and chronic changes to her lumbar spine,” specifically, “mild concentric canal stenosis at
the L4-L5 level secondary to a small broad-based central disc protrusion and posterior element
hypertrophy with ligamentum flavum thickening and moderate lumbosacral face joint arthrosis.”
AR 533. Although the Commissioner argues MRI results demonstrate only mild changes
inconsistent with disabling pain, it is error for an ALJ to rely on “the mildness” of spinal imaging
in assessing functional limitation due to pain. Trevizo, 871 F.3d at 676-77.
Robert Hsiang-Sen Yeh, M.D., replaced Dr. Gabriele as Ms. Gray’s treating physician,
and he provided a medical opinion in April 2016, noting that Ms. Gray had been in his care “for
a little while,” had “disabling symptoms of intractable lower back pain due to lumbar arthritis,”
and had “very little tolerance for exertion.” AR 858. The ALJ rejected the opinion, stating that
The Commissioner’s brief is non-responsive to Ms. Gray’s assignment of error under Trevizo.
PAGE 11 – OPINION AND ORDER
the opinion touched on the ultimate issue of disability which was reserved to the Commissioner,
and was inconsistent with his own treatment notes and the record in general. AR 548.
A discrepancy between a treating source’s medical opinion and the source’s own
treatment notes is a clear and convincing reason to reject that doctor’s opinion. Bayliss v.
Barnhart, 427 F.3d 1211, 1216 (9th Cir. 2005). The Commissioner argues the ALJ accurately
determined that Dr. Yeh’s chart notes demonstrated Ms. Gray was not as limited as his 2016
opinion suggested, citing his report that Ms. Gray walked her dog daily without pain flares, “but
still has trouble doing heavier work.” AR 833. The Court disagrees. Dr. Yeh’s statement that
Ms. Gray has “trouble doing heavier work” is consistent with Dr. Yeh’s opinion that Ms. Gray
has “little tolerance for exertion.” Further, minimal activities such as walking a dog once per day
or occasionally shopping for groceries do not necessarily preclude a valid disability claim. See,
e.g., Reddick v. Chater. 157 F.3d 715, 722 (9th Cir. 1998) (claimants should not be penalized for
attempting to lead normal lives in the face of their limitations).
The ALJ also noted that Dr. Yeh’s opinion was accorded diminished weight because his
“notes d[id] not show a significant change in the claimant’s impairments or functional ability.”
AR 548. Ms. Gray, however, has not alleged a significant change in her condition since she
began treating with Dr. Yeh. Rather, she asserts she has been disabled for the entirety of their
treating relationship. As such, the ALJ’s finding is unsupported by substantial evidence.
Finally, the ALJ concluded that Dr. Yeh’s opinion is not consistent with the record as a
whole or with the opinions of the state agency physicians. AR 548. This finding, however, fails
to consider the fact that the state agency opinions were rendered four years before Dr. Yeh’s
opinions, without the benefit of the MRI of May 2013, which provided a basis for the opinions of
PAGE 12 – OPINION AND ORDER
the treating physicians of record. See AR 140. Thus, none of the reasons provided by the ALJ for
rejecting Dr. Yeh’s opinion meet the specific-and-legitimate legal standard.
There is a two-step process for evaluating the credibility of a claimant’s testimony about
the severity and limiting effect of the claimant’s symptoms. Vazquez v. Astrue, 572 F.3d 586,
591 (9th Cir. 2009). First, the ALJ “must determine whether the claimant has presented objective
medical evidence of an underlying impairment ‘which could reasonably be expected to produce
the pain or other symptoms alleged.’” Lingenfelter v. Astrue, 504 F.3d 1029, 1036 (9th Cir.
2007) (quoting Bunnell v. Sullivan, 947 F.2d 341, 344 (9th Cir. 1991) (en banc)). When doing so,
the claimant “need not show that her impairment could reasonably be expected to cause the
severity of the symptom she has alleged; she need only show that it could reasonably have
caused some degree of the symptom.” Smolen v. Chater, 80 F.3d 1273, 1282 (9th Cir. 1996).
Second, “if the claimant meets this first test, and there is no evidence of malingering, ‘the
ALJ can reject the claimant’s testimony about the severity of her symptoms only by offering
specific, clear and convincing reasons for doing so.’” Lingenfelter, 503 F.3d at 1036 (quoting
Smolen, 80 F.3d at 1281). It is “not sufficient for the ALJ to make only general findings; he must
state which pain testimony is not credible and what evidence suggests the complaints are not
credible.” Dodrill v. Shalala, 12 F.3d 915, 918 (9th Cir. 1993). Those reasons 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, 947 F.2d at 345-46).
Effective March 28, 2016, the Commissioner superseded Social Security Ruling (“SSR”)
96-7p, governing the assessment of a claimant’s “credibility,” and replaced it with SSR 16-3p.
PAGE 13 – OPINION AND ORDER
See SSR 16-3p, available at 2017 WL 5180304 (republished Oct. 25, 2017). SSR 16-3p
eliminates the reference to “credibility,” clarifies that “subjective symptom evaluation is not an
examination of an individual’s character,” and requires the ALJ to consider all of the evidence in
an individual’s record when evaluating the intensity and persistence of symptoms. Id. at *2; see
also Trevizo, 871 F.3d at 678 n.5. The Commissioner recommends that the ALJ examine “the
entire case record, including the objective medical evidence and individual’s statements about
the intensity, persistence, and limiting effects of symptoms statements and other information
provided by medical sources and other persons; and any other relevant evidence in the
individual’s case record.” Id. at *7. The Commissioner recommends assessing: (1) the claimant’s
statements made to the Commissioner, medical providers, and others regarding the claimant’s
location, frequency and duration of symptoms, the impact of the symptoms on daily living
activities, and other methods used to alleviate symptoms; (2) medical source opinions,
statements, and medical reports regarding the claimant’s history, treatment, responses to
treatment, prior work record, efforts to work, daily activities, and other information concerning
the intensity, persistence, and limiting effects of an individual’s symptoms; and (3) non-medical
source statements, considering how consistent those statements are with the claimant’s
statements about his or her symptoms and other evidence in the file. See id. at *6-7.
The ALJ’s credibility decision may be upheld overall even if not all of the ALJ’s reasons
for rejecting the claimant’s testimony are upheld. See Batson, 359 F.3d at 1197. The ALJ may
not, however, make a negative credibility finding “solely because” the claimant’s symptom
testimony “is not substantiated affirmatively by objective medical evidence.” Robbins, 466 F.3d
PAGE 14 – OPINION AND ORDER
At the hearings, Ms. Gray testified that back pain and fatigue require her to lie down to
nap for 1½ to 2 hours each day, and that she has shooting pain down her left leg when standing
or when seated. AR 42-44, 68-69, 574, 587. Ms. Gray stated that although she can cook, she is
unable to wash her dishes because of the pulling and twisting motions involved. AR 53-54. In a
function report Ms. Gray completed for her disability application, she stated she could walk only
one block before she needed to rest for 20 minutes. AR 311.
Both ALJs found that Ms. Gray’s statements concerning the intensity, persistence, and
limiting effects of her pain symptoms were not entirely credible.3 AR 24, 545. Indeed, the
findings in the second ALJ decision regarding Ms. Gray’s subjective symptoms appear to have
been transposed in large part from the first ALJ decision. For example, the second ALJ
transposed, word-for-word, a full paragraph regarding Ms. Gray’s history of substance abuse,
about which the ALJ found she had been “less than completely honest.” Compare AR 18 with
Before the promulgation of SSR 16-3p, ALJs regularly made overarching credibility
findings regarding the reliability of a claimant’s testimony. Generally, ALJs could support a
negative credibility finding by identifying any testimony that was inconsistent with prior
testimony or other evidence of record, and cast doubt upon all the statements of record attributed
to the claimant. See, e.g., Smolen, 80 F.3d at 1284 (ALJs may use “ordinary techniques of
credibility evaluation, such as a claimant’s reputation for lying . . . .”). Under SSR 16-3p,
In the period between the first and second ALJ decisions in this case, the Social Security
Administration promulgated SSR 16-3p. Accordingly, the second ALJ stated that Ms. Gray’s
allegations were “not entirely consistent with the medical evidence and other evidence in the
record,” rather than using the term “credibility.” AR 545. Although the second ALJ did not cite
SSR 16-3p in his decision, on review the Commissioner appears to concede the ruling is
applicable. See Def.’s Br. at 12 (citing SSR 16-3p).
PAGE 15 – OPINION AND ORDER
however, ALJs “must limit their evaluation to the individual’s statements about his or her
symptoms and the evidence in the record that is relevant to the individual’s impairments . . .
[and] will not assess an individual’s overall character or truthfulness in the manner typically used
in an adversarial court litigation.” SSR 16-3p, at *11. Although the second ALJ in this case was
bound to apply SSR 16-3p in his September 15, 2016 decision, the ALJ’s finding that Ms. Gray
“was less than completely honest” about her history of substance use essentially functioned as an
assessment of her character or truthfulness. AR 547. Thus, the finding constitutes legal error.
The second ALJ also ran afoul of SSR 16-3p by transposing other findings from the first
ALJ decision. For example, the second ALJ found that Ms. Gray’s allegations were undermined
by her ability to take a cruise to Mexico in 2011, in a paragraph taken from the first ALJ
decision. AR 18, 547. Although it may be appropriate for the two ALJs independently to reach a
similar conclusion about the cruise, both ALJs misstated the year of the excursion. The record
reflects that Ms. Gray took the cruise in 2010, rather than in 2011. This strongly suggests the
second ALJ did not arrive at the finding entirely independently from the first ALJ’s decision.
AR 476. Regardless, the second ALJ failed to connect the purportedly inconsistent activity,
walking around on a cruise ship, with any specific allegation. AR 547. Rather than “explain[ing]
which of an individual’s symptoms [the ALJ] found consistent or inconsistent with the
evidence,” the ALJ simply provided the general comment that Ms. Gray’s allegations were not
fully supported. AR 547; SSR 16-3p, at *8.
Similarly, the ALJ referred only generally to Ms. Gray’s alleged limitations in finding
that she “got a job babysitting a three-month old baby.” AR 547. The ALJ did not identify any
specific allegation that the activity necessarily belied, and further, the ALJ did not solicit or
explain how often Ms. Gray performed the activity, or why babysitting a three-month old baby
PAGE 16 – OPINION AND ORDER
requires a greater capacity than that endorsed by Ms. Gray. Recently, the Ninth Circuit
determined that the ability to undertake childcare activities does not preclude a disability finding,
particularly where there is very little information describing those activities. Trevizo, 871 F.3d
at 682. The facts and the reasoning in Trevizo directly parallel the issue of Ms. Gray’s
babysitting. The ALJ’s rationale is not legally sufficient. Id.
The ALJ also found that Ms. Gray’s “alleged limitations” were inconsistent with her
ability to perform self-care, prepare simple meals, go to the store, attend Alcoholics Anonymous,
and volunteer to feed the homeless with members of her church. AR 547. The ALJ, however, did
not connect the activities with specific symptoms, but merely provided a boilerplate statement
that the “activities indicated a higher level of function than that alleged by claimant.” Id. The
rationale fails because it is contrary to the guidance set forth in SSR 16-3p, and moreover, it does
not meet the longstanding clear-and-convincing standard for discrediting symptom testimony.
See, e.g., Dodrill, 12 F.3d at 918 (it is not sufficient for the ALJ to make only general findings).
Moreover, the ability to perform minimal activities does not translate into the ability to perform
full-time work, nor does a claimant need to be completely incapacitated in order to receive
benefits. See Fair v. Bowen, 885 F.2d 597, 603 (9th Cir. 1989); Vertigan v. Halter, 260
F.3d 1044, 1050 (9th Cir. 2001).
The Commissioner argues that the ALJ properly found that Ms. Gray’s allegations were
undermined by her course of conservative treatment. Although conservative treatment can be a
valid reason to find a claimant’s allegations of disabling symptoms unsupported, the ALJ must
still provide a clear and convincing rationale in support. Here, the ALJ’s finding was merely that
“treatment has been generally conservative. [Ms. Gray] has not generally received the type of
orthopedic or other specialty medical treatment that one would expect for a totally disabled
PAGE 17 – OPINION AND ORDER
individual.” AR 547. As such, the generalized finding does not meet the clear and convincing
standard. Dodrill, 12 F.3d at 918. Further, assuming arguendo the ALJ had successfully linked
the conservative treatment rationale to one of Ms. Gray’s allegations, “[d]isability benefits may
not be denied because of the claimant’s failure to obtain treatment [s]he cannot obtain for lack of
funds.” Trevizo, 871 F.3d at 681 (quoting Gamble v. Chater, 68 F.3d 319, 321 (9th Cir. 1995)).
The Commissioner does not contest Ms. Gray’s assertion that she had limited financial resources
and did not have health insurance for the entire time she was treated by Dr. Gabriele. See
AR 486. Although Ms. Gray eventually acquired health insurance by June 2013, her uncontested
testimony to the first ALJ was that she was told that her insurance would not cover a surgical
consult. AR 48-49. Thus, the ALJ’s suggestion that Ms. Gray’s allegations were unsupported
because she did not seek specialty medical treatment is not a valid rationale.
The ALJ also found that Ms. Gray’s pain was controlled with narcotic medication.
AR 545. Impairments that can be controlled effectively with treatment are not disabling. See
Warre ex rel. E.T. IV v. Comm’r of Soc. Sec. Admin., 439 F.3d 1001, 1006 (9th Cir. 2006). In
support, the ALJ noted that Ms. Gray was having good results with her pain medications in
October 2010 and April 2011. AR 545. Although improvement was reported, at the subsequent
treatment visit in July 2011, Ms. Gray explained that she was still experiencing enough back pain
that it was difficult for her to stand to do the dishes. AR 481. Ms. Gray’s report to her provider
in 2011 is consistent with her testimony at her hearings, and testimony from her medical
providers and third parties of record. See Pl.’s Reply at 6-7; AR 18, 314, 319, 387, 424, 438 44950, 481, 491, 498, 548, 796-97, 843, 849. Accordingly, it was error for the ALJ to ascribe
reported improvement with pain medications as evidence that Ms. Gray’s pain testimony was
inconsistent with the record as a whole.
PAGE 18 – OPINION AND ORDER
The ALJ also determined that Ms. Gray’s pain allegations were not supported because,
despite alleging longstanding pain, Ms. Gray had been able to maintain employment as a clothes
sorter at the Goodwill. AR 545. The ALJ’s rationale, however, is inconsistent with his own
findings, which established that based on her RFC, she could not return to her prior work due to
her impairments. AR 549, 591. Thus, the ALJ’s conclusion is invalid.
The ALJ also held that limitations arising from Ms. Gray’s mental impairments were not
supported by the record, but the ALJ’s reasoning also fails to meet the legal threshold.
Specifically, the ALJ found that “claimant was not referred to mental health counseling and was
not prescribed antidepressant medications.” AR 546. The ALJ’s finding is erroneous. Ms. Gray
was prescribed a variety of antidepressants in the period between the first and second ALJ
decisions. AR 788, 798, 829, 841-42, 851, 855. Furthermore, in response to questioning by the
ALJ, Ms. Gray explained that her depression seemed to be associated with her back pain. AR 60.
Ms. Gray’s explanation is consistent with Dr. Beickel’s observation that Ms. Gray’s
concentration “is related to the amount of pain and depression she is experiencing,” as well as
the ALJ’s own express finding that “depression related to chronic pain” is a severe impairment.
AR 361, 541. Additionally, Ms. Gray presumably would have had difficulty paying for therapy
even if she had decided to pursue it, because as noted above, she was uninsured for much of the
relevant time period. For all of these reasons, the ALJ’s assessment of Ms. Gray’s subjective
symptom testimony was failed to meet the clear and convincing standard, and remand is
At step five of the sequential evaluation process, the burden of proof rests with the
Commissioner to establish whether other work exists in the national economy that a worker of
PAGE 19 – OPINION AND ORDER
claimant’s age, education, work experience, and RFC is able to perform. See 20 C.F.R.
§§ 404.1569, 416.969; Tackett, 180 F.3d at 1099. In posing hypothetical questions to the VE to
determine if other work exists, the ALJ must include all of the claimant’s functional limitations
which are supported by substantial evidence. Osenbrock v. Apfel, 240 F.3d 1157, 1162 (9th
Cir. 2001). The Commissioner must further establish that the claimant can make an adjustment to
work that “exists in significant numbers . . . in the country . . . .” 20 C.F.R. §§ 404.1566(a),
416.966(a). Here, the ALJ identified three jobs in his decision: electronics worker, laundry
articles sorter, and router clerk. AR 550.
None of the jobs identified by the ALJ, however, were discussed by the VE at the
hearing. See AR 591-92 (VE identifying bakery worker, laminating machine off-bearer, and
school bus monitor). Accordingly, Ms. Gray asserts the Commissioner failed to carry the burden
of proof because there was “no evidence” to support the ALJ’s step five finding. In response, the
Commissioner contends any error was harmless because the jobs identified by the ALJ comport
with Ms. Gray’s RFC requirements.
The ALJ’s RFC formulation was not supported by substantial evidence because of the
legal errors he made in assessing the medical opinion evidence and Ms. Gray’s symptom
testimony. Consequently, the ALJ’s findings at step four and step five also were not based on
substantial evidence. Therefore, the Court does not reach the issue of whether the ALJ erred by
basing his step five findings on jobs that were not identified by the VE.
Remand for Further Proceedings
Within the Court’s discretion under 42 U.S.C. § 405(g) is the “decision whether to
remand for further proceedings or for an award of benefits.” Holohan, 246 F.3d at 1210 (citation
omitted). Although a court should generally remand to the agency for additional investigation or
PAGE 20 – OPINION AND ORDER
explanation, a court has discretion to remand for immediate payment of benefits. Treichler v.
Comm’r of Soc. Sec. Admin., 775 F.3d 1090, 1099-1100 (9th Cir. 2014). 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. Id. at 1100. A
court may not award benefits punitively and must conduct a “credit-as-true” analysis on evidence
that has been improperly rejected by the ALJ to determine if a claimant is disabled under the Act.
Strauss v. Comm’r of Soc. Sec. Admin., 635 F.3d 1135, 1138 (9th Cir. 2011).
In the Ninth Circuit, the “credit-as-true” doctrine is “settled” and binding on this Court.
Garrison, 759 F.3d 995, 999 (9th Cir. 2014). The Ninth Circuit articulates the rule as follows:
The district court must first determine that the ALJ made a legal
error, such as failing to provide legally sufficient reasons for
rejecting evidence. If the court finds such an error, it must next
review the record as a whole and determine whether it is fully
developed, is free from conflicts and ambiguities, and all essential
factual matters have been resolved. In conducting this review, the
district court must consider whether there are inconsistencies
between the claimant’s testimony and the medical evidence in the
record, or whether the government has pointed to evidence in the
record that the ALJ overlooked and explained how that evidence
casts into serious doubt the claimant’s claim to be disabled. Unless
the district court concludes that further administrative proceedings
would serve no useful purpose, it may not remand with a direction
to provide benefits.
If the district court does determine that the record has been fully
developed and there are no outstanding issues left to be resolved,
the district court must next consider whether the ALJ would be
required to find the claimant disabled on remand if the improperly
discredited evidence were credited as true. Said otherwise, the
district court must consider the testimony or opinion that the ALJ
improperly rejected, in the context of the otherwise undisputed
record, and determine whether the ALJ would necessarily have to
conclude that the claimant were disabled if that testimony or
opinion were deemed true. If so, the district court may exercise its
discretion to remand the case for an award of benefits. A district
court is generally not required to exercise such discretion,
PAGE 21 – OPINION AND ORDER
however. District courts retain flexibility in determining the
appropriate remedy and a reviewing court is not required to credit
claimant’s allegations regarding the extent of their impairments as
true merely because the ALJ made a legal error in discrediting
Dominguez v. Colvin, 808 F.3d 403, 407-08 (9th Cir. 2015) (internal citations and quotation
Here, the ALJ committed reversible errors in assessing the medical opinions of
Drs. Anderson, Perry, Gabriele, and Yeh; and failed to provide legally sufficient rationales for
rejecting the symptom testimony provided by Ms. Gray. Thus, the first prong of the Garrison
credit-as-true test is met.
In support of the position that the record is not fully developed, the Commissioner argues
that further proceedings would allow an ALJ “to resolve conflicts between Ms. Gray’s testimony
and the opinions of the State agency consulting physicians, each of whose opinions were
consistent with sustained competitive employment[,]” although the Commissioner does not
identify any specific conflicts. Furthermore, the Commissioner’s argument does not reflect the
record. For example, the ALJ erred by failing to incorporate into the RFC the entirety of the
assessment of reviewing physician Dr. Anderson, who opined that Ms. Gray would have social
interaction limitations in the workplace. Moreover, the Commissioner conceded that the
omission of Dr. Anderson’s assessed social limitation was erroneous, although the
Commissioner argued the error was harmless. As demonstrated in the first ALJ hearing, the
addition of such a limitation to Ms. Gray’s RFC would preclude all light and sedentary work. See
AR 82-85. Accordingly, the Commissioner’s argument fails.
The Court, therefore, next considers whether an ALJ, on remand, would be required to
find Ms. Gray disabled if the erroneously discredited evidence were credited as true. As noted,
the VE testimony of record establishes Ms. Gray would be disabled if Dr. Anderson’s limitations
PAGE 22 – OPINION AND ORDER
were credited. Id. The conclusion is further supported by the opinion of longtime treating
physician Dr. Gabriele, who indicated Ms. Gray’s pain allegations were supported by objective
evidence, namely, the 2013 MRI, and that Ms. Gray had additional “social obstacles” that were
likely to hinder her effectiveness in the workplace. AR 533. Ms. Gabriele’s opinion is consistent
with the erroneously discredited opinion of Dr. Yeh, who noted that Ms. Gray has “multiple
medical and mental health issues,” including “disabling” pain symptoms and little tolerance for
exertion, as well as “anxious depression and memory loss.” AR 858. Those opinions are
consistent with the opinion of consultative psychologist Sharon L. Beickel, Ph.D., who opined
that Ms. Gray was not able to remember instructions, and could only be expected to sustain
concentration for short periods of time based on the amount of pain and depression she was
experiencing. AR 361. ALJ accorded “significant weight” to Dr. Beickel’s opinion despite
finding it was “vague and subject to multiple interpretations,” and further indicated it was
consistent with the opinions of the reviewing physicians, including Dr. Anderson. AR 548.
Because Dr. Perry provided two contradictory opinions regarding the number of hours
Ms. Gray could be expected to stand and walk, it is not possible to establish an unequivocal
conclusion about his findings by crediting them as true. Compare AR 352 (four-hour stand/walk
limitation) with AR 459 (six-hour stand/walk limitation). This ambiguity, however, does not
require further proceedings because fully crediting the opinions of Drs. Anderson, Beickel,
Gabriele, and Yeh would direct a finding of “disabled,” even if Dr. Perry’s less limiting six-hour
stand/walk limitation were credited as true. Finally, both VEs opined that Ms. Gray would not be
able to sustain gainful employment if she needed to lie down every day for 1½ to 2 hours. AR
68-69, 597-98. Thus, if her allegations were credited as true, Ms. Gray would be found disabled
under the Act.
PAGE 23 – OPINION AND ORDER
This record leaves little doubt that Ms. Gray is disabled. This case marks the
Commissioner’s second opportunity to demonstrate to the District Court that Ms. Gray is not
disabled. After a remand hearing, the second ALJ issued a decision that repeated several of the
first ALJ’s errors of fact and law, failed to follow a binding SSR, and provided only a
perfunctory analysis of the opinions of Ms. Gray’s treating physicians. Further, the second
decision’s RFC formulation failed to include all of Ms. Gray’s accepted limitations, and despite
purporting to rely on VE testimony, the second ALJ appeared to completely disregard the VE’s
testimony regarding “other work” and instead derived his own findings. Compare AR with
Setting aside the legal errors in both the decisions in this case, Ms. Gray was twice found
to be limited to less than a full range of light work. Ms. Gray is now 56 years old, and her
disability applications have been in process for nearly seven years. If, on remand, a new RFC
were formulated that limited Ms. Gray to sedentary work, the Medical-Vocational Guidelines
would direct a finding of disabled, based on the second VE’s assertion that she has no
transferable job skills. See AR 593; 20 C.F.R. Part 404, Subpart P, Appendix 2; SSR 83-10, 1983
WL 31251, at *6. These facts strongly militate against remanding this matter for further
proceedings, as the Commissioner has had ample opportunity to establish non-disability, and
additional proceedings would cause additional delay and a waste of resources. See Benecke v.
Barnhart, 379 F.3d 587, 595 (9th Cir. 2004) (“Allowing the Commissioner to decide the issue
again would create an unfair ‘heads we win; tails, let’s play again’ system of disability benefits
adjudication.’”) (citation omitted); see also Garrison, 759 F.3d at 1021-22.
The Court additionally notes that despite finding Ms. Gray could not return to her prior work as
a “clothing sorter” at step four, the second ALJ, in an apparent contradiction, nevertheless
determined at step five that Ms. Gray could perform the work of “laundry article sorter.” See
PAGE 24 – OPINION AND ORDER
As the first ALJ noted, res judicata applies to this case because of a final denial made on
a prior application for benefits on October 15, 2010. AR 11-12. Accordingly, the Court remands
this case for immediate calculation and payment of benefits for the period beginning October 16,
Because Ms. Gray has identified harmful error in the ALJ’s assessment of the medical
opinions of record and her symptom allegations, which resulted in an erroneous RFC formulation
and subsequent error at step five, the Commissioner’s decision is not based on proper legal
standards or supported by substantial evidence. Therefore, Ms. Gray’s request for remand
(ECF 1) is GRANTED. The Commissioner’s decision is REVERSED, and this case is
REMANDED for immediate calculation and payment of benefits beginning on October 16,
DATED this 9th day of February, 2018.
/s/ Michael H. Simon
Michael H. Simon
United States District Judge
PAGE 25 – OPINION AND ORDER
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