Friday, August 12, 2016

Rules Matter -- Cuevas v. Hartley and Kozinski's Dissent

Run of the mill ... ho hum.  Cuevas v. Hartley is just another habeas case.  But it represents much more -- a practice that Judge Alex Kozinski labels a game of "dare."  From the former Chief Judge's perspective, attorneys file oversized briefs at the last minute with a motion to permit the filing of a brief that violates the court rules that just dare the court to reject the brief and say "no." 

The passive-aggressive posture adopted by counsel that disrespects the court's case load.  A judicial officer has to manage his/er docket.  That is job number one.  Attorneys for a party must act ethically first, as the fiduciary to the client second, and to facilitate the court as a third priority.  I saw this in an order from the Eastern District of California last month, Salinas v. Colvin

The government attorney asked for a third extension of time to file a brief in opposition.  The court did not find good cause and took the matter under submission.  Judge Grossjean previously warned: "extensions based on demands of other cases are disfavored" and that "no further extensions will be permitted absent extraordinary circumstances." The court noted that the extension would put the matter 90 days behind schedule, did not articulate good cause, and got filed after the due date for the brief. 

Cuevas and Salinas may mark a turning point where the courts correct the relationship -- attorneys facilitate the courts' management of their docket; courts do not facilitate attorneys' management of time.  Some balance is in order but filing for a fat brief the day it is due or filing for a late brief after it was due are just disrespectful.  Rules matter, try to comply. 

Wednesday, August 3, 2016

Production Workers, all other SOC 51-9199

During the last couple of years, I have struggled with the administrative notice provisions of the Social Security regulations.  20 CFR 404.1566(d).  The Occupational Outlook Handbook did not have a detailed entry for this massive aggregation of DOT codes.  Nor did it have this group of occupations on the list of occupational groups not covered in detail. 

For the 2014 publication of job numbers, the OOH does now.  Listing 51-9199 on the occupations not covered in detail fills in a large hole in the OOH.  The group contains either 1525 or 1590 different DOT codes.  The 1525 estimate contains 52 sedentary and 395 light unskilled occupations.  Remember -- the sedentary unskilled occupations in the DOT total 137 codes; the light unskilled occupations total about 1400.  This group is HUGE because there are not enough of any one group of occupations in 51-9199 to warrant a separate listing.  The last digit -- the "9" -- means not elsewhere classified.  The "9" says, we don't have a place for these occupations so BLS puts them here,. 

Now that the OOH lists 51-9199 in the not covered in detail page, we now get the full linkage.  The limited discussion addresses educational requirements for most of the occupations -- surprise it is high school or more.  It links to the O*NET listing for the group.  The detail tab of the listing allows the users of the OOH to see that the O*NET lists the group as containing 1590 different DOT codes.  It also links to the employment projections that list the industries in which the occupational group exists. 

BLS publishes the employment projections for all SOC groups.  That list includes the specific spreadsheet for production workers, all other -- group 51-9199

PRACTICE POINTER:  when the vocational expert states that there are 200,000 or even 20,000, even if the vocational expert says 2000 jobs exist within an occupation that is included in 51-9199, ask for the industries in which the occupation exists and cross-index that result on the BLS employment projections.  Don't forget to ask if the witness uses the OOH as well as the linked O*NET and employment projections as well as the County Business Patterns. 

Friday, July 8, 2016

A Dangerous Trend -- Re-Writing the ALJ Decision

Unpublished memoranda -- yawn, they are not precedential.  The only parties that care are the parties to that memorandum and onlookers waiting for trends to develop.  Roy v. Colvin is such a memorandum.

The court found that the ALJ erred in rejecting the opinions of Dr. Eisenhauer.  The question is always materiality -- would it have mattered.  Under Stout v. Commissioner, the thought experiment assumes that the improperly rejected evidence is true and then asks would that credited evidence change the outcome.  Roy finds that the ALJ could have rejected the findings of Dr. Eisenhauer because those findings were brief and conclusory.  But the ALJ never found Dr. Eisenhauer's opinions to be brief and conclusory.  The Ninth Circuit said that.  Neither the District Court before it nor the Ninth Circuit on de novo review gets to weigh the facts.  Did the ALJ commit legal error or did the ALJ make a fact finding lacking the support of substantial evidence?  That is the sole function of the court.

Where the ALJ thinks that the report of a doctor belongs to another person and it turns out the ALJ was wrong and where the ALJ gives no other reasons for rejecting that opinion evidence, the court should NOT re-write the ALJ decision to give a reason that the ALJ did not offer.  "We are constrained to review the reasons that ALJ asserts.  SEC v. Chenery Corp., 332 U.S. 194, 196 (1947)."  Connett v. Barnhart.  The Ninth Circuit lacks the judicial power to add reasons that the ALJ did not articulate.  This stands at the corner of administrative law -- don't excuse a decision because you think this ALJ might have decided it the way that you would because you, the court, are not the fact finder.

Spiva v. Astrue said it best: the government seems "determined to dissolve the Chenery doctrine in an acid of harmless error."

The Ninth Circuit should adopt and follow Spiva lest we all ingest a corrosive acid that gives everyone a jurisprudential ulcer.

Tuesday, July 5, 2016

Attmore v. Colvin - Medical Improvement Standard

The Ninth Circuit published its opinion in Attmore v. Colvin last week.  The court doesn't publish a lot of any kind of decision.  The case has to reinforce a proposition that the districts are getting wrong, and not just in that case, or say something new that the court has not previously addressed.  Most cases are too fact specific to warrant publication.  Which is why memoranda dispositions are not precedent for anything -- too short on the facts.

Attmore is a something new decision.  Once SSA finds the claimant disabled, the ALJ cannot cut the person off of disability without evidence of medical improvement related to the ability to perform work.  20 CFR 404.1594.  From the facts of the case and the district court decision, the ALJ reasonably found Attmore disabled.  It is also inferred from the decision that the ALJ could have reasonably found that Attmore's disability ceased.  But that isn't enough.  The actions, decisions, and determinations of SSA have to make sense in the whole, not in bifurcated analysis.

If Attmore was disabled for a discrete period of time and there is inadequate evidence of improvement, then SSA could not terminate the period of disability or entitlement to SSI.  The facts limit the reach of the holding.  Attmore had isolated pockets of doing well with other periods of not doing well.  Substantial evidence did not permit an inference of sustained capacity to engage in substantial gainful activity.  The keystone in that bridge is "sustained."

Without the prior finding of disability during the earlier period, Attmore would have had a different problem.  Attmore would have had to prove the inability to engage in work for 12 continuous months.  SSA would have argued, as it typically does, that the pockets of improvement destroy the durational requirement.  But that is a specious argument for another day and another case-focus.

Friday, July 1, 2016

The Court Orders the Payment of Benefits and SSA Drags Its Feet

The court ordered the payment of benefits on a date in the past.  Six months later, the agency has failed to process the claim.  The claimant is prejudiced by the delay because SSI benefits are paid in installments.  POMS SI 02101.020 effectuating 7502 of the Deficit Reduction Act of 2005 (P.L. 109-171). 

If SSA does not initiate the payment of benefits within 21 days, file a motion in the court asking the court to issue an order to show cause why the Commissioner of SS should not be held in contempt.  The claimant is entitled to be paid. 

The claimant should take a copy of the memo and judgment to the congressperson's office and start an inquiry. 

The attorney should write to the District Office and to the Appeals Council Court Case Branch with the judgment and the memorandum demanding immediate processing.  

Wednesday, June 22, 2016

Court Scrutiny of EAJA Settlements with a Federal Agency

The parties attempted to settle this matter, twice.  The court denied the opportunity to settle this matter because the Commissioner did not confess a lack of substantial justification.  Counsel  represents to the court that no other court in which he practices requires a confession of error or a confession of a lack of substantial justification in order to permit a represented party to resolve a matter of questionable or certain loss.  Would the court require the United States to admit to negligence in an action under the Federal Tort Claims Act in order to resolve a negligence claim?  Undoubtedly that would prevent resolution of claims because the alleged tort feasor rarely admits to liability in a settlement – the parties settle for reasons that they don’t admit to each other much less the world.  

The United States is never estopped in other cases because the Commissioner settled any claim arising under the EAJA.  New Hampshire v. Maine, 532 U.S. 742, 755 (2001) (citing Heckler v. Community Health Services of Crawford Cty., Inc., 467 U. S. 51, 60 (1984)).  Settlement does not conclusively establish weakness and the court should not penalize or discourage useful settlements.  Pierce v. Underwood, 487 U.S. 552, 568 (1988). 

And the risk to the fisc is significant.  The preparation of serial stipulations, motions, or other documents to evade the court’s requirement that a settlement include a confession of sin eats at the most valuable public and private asset of the parties – the time of their counsel.  Nor does this motion seeking the court finding of a lack of substantial justification help.  But for the settlement, this party would seek $4,600 in fees and expenses already itemized and additional time for the preparation of this motion.  Settlement allows the Commissioner to avoid some of its exposure in exchange for a sacrifice of some of the plaintiff’s potential fee recovery all with the serendipitous result that allowing parties to settle avoids the court’s expenditure of time and effort in the noble quest that the ably represented United States not give away the contents of the Treasury or the Social Security Trust Funds.   

In the final analysis, the court’s oversight of the EAJA process should not amount to a rigorous extraction of itemization and confession of each element of the fee request.  The court need exercise care in approving settlement of class actions because of the divergent interests of the class representatives, class counsel, and the members of the class.  Hanlon v. Chrysler Corp., 150 F.3d 1011, 1026 (9th Cir. 1998) (risk, expense, complexity, likely duration, amount offered, extent of discovery, stage of proceedings, experience and views of counsel, presence of a government entity, and view of the proposed class).   But those factors are not present in individual party litigation after the close of the merits.  Fees should not give rise to a second round of motion practice or litigation.  Hensley, 461 U.S. at 437.  The Supreme Court focused on the desired practice – “Ideally, of course, litigants will settle the amount of a fee.”  Id.  If the parties don’t settle, then and only then does the prevailing party bear the burden of proof of time, rates, and entitlement.  Id.  Where the parties resort to the ideal, the court should not put the parties to the expense of the unideal.  The court should approve the fee agreed upon by the parties.

Wednesday, June 15, 2016

Subsequent Applications and Fees -- Oh My

On June 3, we discussed the ethics and strategy behind a subsequent application while the claimant has a complaint for review pending with the federal courts -- Just Do It.  The problem for the representatives extend beyond the cutting off of the past-due benefit accumulation.  The fees get messy.

1.  The Subsequent Application Gets Paid

Whether by initial determination, reconsideration determination, or hearing, subsequent applications get paid with fair regularity.  These are cases on the cusp where reasonable minds could differ; you contend that the ALJ acted unreasonably in denying the case now pending in court.  These cases get paid, expect it.

The typical paradigm is the fee agreement process.  As long as the operative fee agreement is 25% of the past due benefits or $6,000, whichever is less, applies to the subsequent application, the fee agreement will get approved and the representative will get paid.  HALLEX I-1-2-16 states that the ALJ or the AC will approve or disapprove the fee agreement on the facts before the agency.  POMS GN 03940.038 gets into more detail but to the same result.  When the claimant receives a favorable decision on a subsequent application, SSA will approve the fee agreement and pay the withheld fees so long as the fee agreement meets the requirements and the representative is eligible.

What HALLEX and POMS do make clear is that all the cases that the claimant has constitute one case for fee purposes.  That $6,000 ceiling on the fees for the subsequent application continues to apply if and when the district court remands the case back to the agency for further proceedings.  There is no reset button and the claimant is not liable for up to $6,000 twice.  One continuous period deserves one fee.

     a. No Tiering and Same Representative(s)

The last fee agreement controls the fees in the case.  If the representative had the claimant sign a new fee agreement on filing the subsequent application, that is the fee agreement that controls all the fees.  Remember, one fee for the entire case.  All representatives must sign the same fee agreement.  The usual conditions apply.

If the fee agreement does not make an exception to the ceiling for remanded cases, the fee agreement continues to apply.  If the representative received $2,000 on the subsequent claim, the maximum that representative can get on the remanded case for agency work is $4,000.  The time to request administrative review of the fee ceiling -- that deadline is triggered by the notice of award or other payment document on the first favorable decision, the one on the subsequent application.  Absent that timely request for administrative review of the fee filed before the court remanded the case, the representative is stuck with the ceiling.  HALLEX I-1-2-14.

     b.  Tiering or Different Representatives

If the fee agreement provides for a fee without reference to a ceiling on remand, the conditions for approval of the fee agreement no longer apply.  If the claimant appoints different representatives or they all don't sign the same fee agreement, the conditions for approval of the fee agreement no longer apply.  These circumstances manifest for the first time after a favorable decision and cause a rescission of the approval of the fee agreement on the subsequent application.  HALLEX I-1-2-16

Whatever fee the representative received on the subsequent application, that authorization to charge and receive a fee is no more.  It is gone.  The representative now holds an unauthorized fee with all of the potential ramifications for holding an unauthorized fee.  Prudence suggests that moving that fee amount to a client trust account is the minimum required. 

All the representatives must file a fee petition with the decision maker that made the last favorable decision and order rescinding approval of the fee agreement on the subsequent application.  The representative must cover all the fees that he/she will seek to charge and receive. 


Claude Claimant goes through the process and receives a denial of review from the Appeals Council.  CC and Rachel Representative refer that case to Andy Attorney.  RR advises CC to file a new claim, which he does. 

While AA goes through the litigation process, RR presses the claim forward on the subsequent application.  CC receives a favorable decision and receives an award for $16,000 is past due benefits.  RR receives a fee agreement approval and a fee of $4,000 for her services.  AA wins the federal court action, obtaining a remand for another hearing.  The Appeals Council affirms the subsequent grant and remands the first claim to an administrative law judge to comply with the order of the court. 

On remand, AA represents CC.  The ALJ issues a fully favorable decision awarding CC a finding of disability for the earlier period and rescinding the fee agreement.  For the period not covered by the subsequent claim, SSA owes CC an additional $60,000 in PDB.  RR must now move the $4,000 to trust; she is no longer authorized to hold that fee.  RR and AA must file fee petitions to charge and receive a fee.  AA can also apply for fees in federal court, subject to the offset for any EAJA fee received.

If RR represented CC at the remand hearing without a tiered fee agreement and did not request administrative review after the favorable decision/determination on the subsequent claim, the most that RR could receive for that last hearing (and the first one that lead to the court action) is $2,000. 

It doesn't matter if AA had a tiered fee agreement, AA and RR are not in the same firm and the conditions to approve the fee agreements no longer apply.  The agency will only approve on fee agreement.  Two fee petitions will have to be filed. 

The lesson is that the subsequent application can cause fee issues later.  As we discussed earlier this month -- it is ethically required to advise the client of the advantages and disadvantages to the client of a new application.  Convincing the client not to file a subsequent claim because it makes AA's fees problematic is poor form.  Client's interests first and foremost.  We are fiduciaries and that is how fiduciaries act.