Subsequent Applications -- Just Do It

For representatives that have clients whose cases go to federal court, the filing of a subsequent application can cause problems with the fees charged.  This is true whether the representative is also a lawyer that handles the case in federal court while pursuing a subsequent claim; the representative refers out the federal court claim and represents the claimant on the subsequent claim; or refers the client for the federal court claim and the subsequent claim to an attorney. 

1.  The Subsequent Claim

First things first, representatives have a duty to advise their clients on the ability to file a new claim with Social Security while the other claim is in federal court.  A grant of a subsequent claim cuts off the accrual of past due benefits for fees.  That works to the net benefit of the claimant and the net loss of the attorney.  Attorneys "shall consult with the client as to the means by which they are to be pursued."  ABA Model Rule 1.2(a).  This fits with the obligation to provide competent representation.  POMS GN 03970.010.    Absent an expired "date last insured" for Title II benefits, the only reason to endure the risk of litigation without putting all the eggs in one basket is to protect the prospective fee interests of the representative(s).  Attorneys must advise their clients of the right and effects of a subsequent claim under the ABA Model Rule.  See also California Rules of Professional Conduct Rule 3-500.

Most claimants will take the option to spread the risk of loss of past and future benefits and file a new claim.  The claimant can do so with or without representation.  If the claimant appoints a representative as to that claim and the prosecution of that claim results in the payment of benefits, that representative may charge and receive a fee under the fee agreement process. 

2.  The Court Action

On average, the courts grant relief in under half of the claims for relief presented.  Successful claimants may receive fee relief under the Equal Access to Justice Act.  Attorneys may take a lien or accept an assignment in those EAJA fees.  Attorneys may receive fees from the past due benefits, up to 25% of the benefits that result from the action for review.  The most common form of relief in a court proceeding to review the final decision of the Commissioner is a remand for further proceedings. 

3.  Consolidation

If the claimant receives a remand order from the court with the subsequent claim pending, SSA may consolidate the two claims for a single decision.  HALLEX I-1-10-25.  Two claims under the same title with abutting or overlapping periods of time present a single question of whether and when disability exists.  Two claims under different titles with overlapping periods of time present issues of collateral estoppel as to the whether and when disability exists to the extent of temporal congruence.  Two applications that do no overlap or abut the periods of time should not get consolidated. 

If the claimant receives a remand order from the court with a subsequent claim already in pay status, SSA may consider reopening and revising that grant of benefits.  Reopening puts the onus of quick action on the agency to resolve the matter diligently.  Carillo-Yeras v. Astrue.

If the claimant receives a remand order from the court with a subsequent claim already in pay status, SSA may affirm the grant of benefits on the subsequent application.  The claimant can proceed to decision on remand without concern that the agency will disturb the current pay status.  This is the best case scenario and more likely now than it was prior to SSR 11-1p. 

4.  The Potential Downside

The filing of a subsequent claim with a prior claim pending in federal court continues the development of the medical file.  SSA, through the state agency, will collect records to develop the subsequent claim and may send the claimant out for consultative examinations.  The presence of a subsequent claim permits the representative to have access to a drop point for newly developed medical evidence.  Those are positive points.  So is there a downside?

The potential downside to filing a new claim for benefits is that the state agency will collect records and possibly send the claimant out for new examinations while developing new opinion evidence from the state agency physicians.  New evidence may cut both ways.  With the 2015 revision to the regulations requiring the claimant and the representative to submit all evidence that relates to the claim, the perception of a way to avoid new harmful evidence takes on an illusory characteristic. 

The ALJ also has the right and perhaps the responsibility to send the claimant out for new consultative examinations on remand.  The remand refloats the application and the ALJ must adjudicate through the date last insured to deny the claim and through the date of decision to allow the claim or for an unexpired date last insured.  That makes evading the subsequent application to prevent development of other non-treating medical evidence a mirage. 

5.  Should the Claimant File a Subsequent Application While Pursuing a Federal Court Action?

For SSI - yes.
For DIB - yes if the claimant has an unexpired date last insured beyond the date of the administrative decision. 

Just do it. 

Social Security Rulings 16-3p and 96-7p

The Commissioner rescinded SSR 96-7p when she published SSR 16-3p.  The banner headline across SSR 96-7p says it all -- Superseded.

The demise of one of the Process Unification Rulings -- the 96 series.  The rulings that sought to bring harmony between the initial, reconsideration, hearings, and review processes.  With the demise of SSR 96-7p, the Commissioner changes the interpretation of the stable regulation.  So, what was wrong with SSR 96-7p?

The first thing wrong with the old ruling was its title, emphasizing credibility.  It is not that the person has general credibility, but rather whether the symptoms of a medically determinable impairment could cause the limitations described.  The Commissioner phrases it:

Rather, our adjudicators will focus on whether the evidence establishes a medically determinable impairment that could reasonably be expected to produce the individual's symptoms and given the adjudicator's evaluation of the individual's symptoms, whether the intensity and persistence of the symptoms limit the individual's ability to perform work-related activities.

 The Commissioner keeps the two-step process of first establishing the medically determinable impairment.  That keeps with the statutory mandate that every disabling impairment get proved by clinically accepted laboratory or diagnostic techniques.  Then the adjudicator assesses the subjective perception of pain -- are the symptoms within the range of reasonable?

The practical effect of the ruling is to remove certain cards from the adjudicators deck of reasons to reject the complaints of limitation.  If it isn't about credibility, then criminal history should not matter.  The Commissioner explains:

our adjudicators will not assess an individual's overall character or truthfulness in the manner typically used during an adversarial court litigation

 Nor should the dearth of a work history matter in terms of evaluating symptoms.  There in paragraph 2.b, the Commissioner tells the adjudicator to consider "prior work record."  So we can't get too excited about the death of the credibility finding.  Most of these cases turn on the residual functional capacity analysis.  To that point, the Commissioner directs the adjudicators:

We consider the individual's symptoms when determining his or her residual functional capacity and the extent to which the individual's impairment-related symptoms are consistent with the evidence in the record.

 SSR 16-3p changed the lay of the excess pain analysis.  Credibility is not the focus but some of the factors will continue to have a credibility flavor.  Shed a tear for the death of 96-7p and hail the new regent, SSR 16-3p.

Just in case you were wondering -- yes, SSR 16-3p probably applies to pending cases.  The application of a new interpretation to a stable regulation (20 CFR secs. 404.1529 and 416.929) applies unless the claimant would be prejudiced by application of the new interpretation.  Montgomery Ward & Co. v. FTC. Other circuits have their own variation of the retroactivity analysis.  This is the California Social Security Attorney blog. 

The Limited Utility of Unpublished Opinions

In Garcia v. Commissioner, Judge Kozinski quipped to the hapless attorney, "I know how fond you are of unpublished dispositions."  In the published opinion, the court noted the prior unpublished opinion:

We recognize that our holding here is contrary to Andrade v. Commissioner of Social Security, 474 Fed.Appx. 642 (9th Cir.2012). We are not bound by our earlier decision. See 9th Cir. R. 36-3(a).

Judges Kozinski and Reinhardt addressed the problem of unpublished opinions in a piece originally published in the California Lawyer.  Please Don't Cite This.   Judge Kozinski wrote a history lesson on the advent of precedent in Hart v. Massanari.  Yep, same hapless attorney and the quip in Garcia reminded at least two people in the room about Hart.

But why the fuss about unpublished dispositions?  Because they lack the in depth discussion of the facts and the legal nuances.  The stuff that calls for the attorney to distinguish what happened before to what the court now considers -- legally and factually.  The law is contextual.  Using unpublished memoranda as the best persuasive argument is just poor lawyering.

So what is the value of the unpublished memorandum?  The memoranda give the legal kernels that point to the core of the issue.  Some of the facts might be there but the disposition is typically way too short to resolve the issue.  Go back to Please Don't Cite This and the decision in Hart to understand the reason why the courts don't have time for a precedential decision in every case.

Notes on McLean v. Colvin — and EAJA Case

In an unpublished opinion, the Ninth Circuit decided McLean v. Colvin, reversing the District Court's denial of fees and expenses under the Equal Access to Justice Act.  The case is important because it reinforces in a persuasive manner the proposition that an ALJ decision that lacks the support of substantial evidence or violates the law, the cases, or the rulings will lack safe refuge under the cloak of reasonableness.  Congress passed and Pres. Reagan signed the EAJA to offset the expense and burden of proceeding to court against the United States.  And unduly strict reading of the substantial justification doctrine defeats the purpose and intent of the act to reimburse partially that expense.

One word of caution is in order.  The court cites to Social Security Ruling 96-7p.  the Commissioner superseded that ruling with Social Security Ruling 16-3p on March 28, 2016.  Look for synthesis and comparison of the two rulings on this blog in the near future.


The Legal Kernels Derived from McLean

The court has jurisdiction pursuant to 28 USC § 1291.

The court reviews the decision of the district court for an abuse of discretion.  Tobeler v. Colvin, 749 F.3d 830, 832 (9th Cir. 2014). 

The ALJs mischaracterization of, and failure to weigh properly, the record evidence cannot be said to be justified to a degree that would satisfy a reasonable person.  Meier v.  Colvin, 727 F.3d 867, 870, 872 (9th Cir. 2013); cf. Sampson v.  Colvin, 103 F.3d 918, 921–22 (9th Cir. 1996).

The ALJ violated the Commissioner’s own regulations by failing to discuss side effects of medication and failing to explicitly state whether the side effects had adequately supported the temporary discontinuation of other medication.  Gutierrez v. Barnhart, 274 F.3d 1255, 1259 (9th Cir. 2001); Social Security Ruling 96-7p; 20 C.F.R. §§ 404.1529(c)(3)(iv); 416.929(c)(3)(iv). 

The ALJ’s failure to credit the testimony was not harmless because it affected the ultimate determination on the issue of medical improvement.  Molina v. Astrue, 674 F.3d 1104, 1115 (9th Cir. 2012).  

Notes on Finnegan-Crews v. Colvin

The Ninth Circuit made a number of pedestrian observations in the unpublished opinion of Finnegan-Crews v. Colvin.  These unpublished opinions give insight into how we can expect the court to handle similar questions in other cases.  Unpublished opinions are never precedent and may have dubious persuasive value.  Attorneys should always use caution in resorting to unpublished opinions.

The most troubling part about the court's decision is the reference to ALJ issue waiver.  It is easy to read the language contained in the decision for the proposition that this person who proceeded at least in the Ninth Circuit without the benefit of an attorney waived an issue.  The courts generally give people proceeding without benefit of counsel a break in terms of the rules.

Government counsel will likely read this decision as permitting the agency to argue that the claimant for benefit that fails to raise an issue before an ALJ may not raise it in court.  That really isn't the point of this decision nor the authority relied upon by the Ninth Circuit (Greger).  Finnegan-Crews didn't raise the hip injury issue either before the ALJ or the District Court.  Properly read and parsed, raising the issue of the disabling hip injury before either the ALJ or the District Court may have saved Finnegan-Crews from the waiver doctrine.

The Legal Kernels Derived from Finnegan-Crews

The court has jurisdiction pursuant to 28 USC § 1291.

The court reviews the District Court’s decision to novo.  Ghanim v. Colvin, 763 F.3d 1154, 1159 (9th Cir. 2014).

Finnegan-Crews waived her contention regarding a disabling hip injury by failing to raise it before the administrative law judge (“ALJ”) or the district court.  See Greger v.  Barnhart, 464 F.3d 968, 973–74 (9th Cir. 2006). 

The ALJ may reject the opinions of the treating physician for specific and legitimate reasons, supported by substantial evidence.  Ghanim v. Colvin, 763 F.3d 1154, 1160–61 (9th Cir. 2014); Batson v. Comm’r of Soc.Sec. Admin.,  359 F.3d 1190, 1195 (9th Cir. 2004). 

The ALJ must use a two-step analysis to provide specific, clear, and convincing reasons to reject testimony and to find other statements not fully credible.  Rounds v. Comm’r of Soc. Sec.Admin., 807 F.3d 996, 1006 (9th Cir. 2015) (ordinary tests of credibility and observations permitted); Treichler v.Comm’r of Soc. Sec. Admin.,  775 F.3d 1090, 1102–03 (9th Cir. 2014) (the ALJ must specifically identify the testimony he finds not credible and explain what testimony undermines that testimony); Molina v. Astrue, 674 F.3d 1104, 1113 (9th Cir. 2012) (rejecting testimony where the medical evidence showed the anxiety disorder well-controlled with medication and other self-combing measures).

Minimal or Superficial Contact with Coworkers and Supervisors -- A Debilitating Limitation

The ALJ finds a limitation to simple, repetitive tasks with limited or no contact with the public, coworkers, or supervisors.  Can that person work?  The answer is "no."

According to the Social Security Administration's regulations, a basic work function includes responding appropriately to supervision, coworkers, and usual work situations.  20 CFR §404.1521(b)(5).   So far we have a severe impairment, this person cannot tolerate and cannot respond appropriately to supervisors or coworkers according to the residual functional capacity assessment described by the ALJ.   The Commissioner of Social Security specifically recognizes that limitations in the amount of supervision a person can tolerate constitutes an important part of the rating of the ability to perform the social requirements of work activity.  20 CFR §404.1520a(c)(2).   The ability to respond appropriately to supervision and coworkers is also at the core of a residual functional capacity assessment.  20 CFR §404.1545(c).

So in this hypothetical situation, the ALJ finds a person cannot tolerate coworkers or supervisors, or at most can tolerate limited contact with coworkers or supervisors.  People engaged an unskilled work, or anyone who acts as an employee, must have the ability to interact with coworkers and supervisors unless that person works alone.   The Social Security Administration has a published policy that describes the ability to respond appropriately to supervision, coworkers, and work situations as a basic mental demand of competitive, remunerative, unskilled work activity.   POMS DI 25020.010 ¶ A.3.   Later, the policy memorandum states that mental abilities for performing unskilled work includes the ability to work in coordination with our proximity to others without being unduly distracted by them; asking simple questions or requesting assistance; accepting instruction and responding appropriately to criticism from supervisors; getting along with coworkers were peers without unduly distracting them or exhibiting behavioral extremes; and responding appropriately to changes in a routine work setting.   POMS DI 25020.010 ¶ B.3.

A common theme of this log has stressed that vocational experts will testify to pretty much anything depending on the identity of the person asking them the question.  I call that professional prevarication.

The Social Security Administration deals with the problem of a vocational experts testifying contrary to agency policy.  Social Security Ruling 00-4p.   An ALJ can accept vocational expert testimony that contradicts the DOT or other sources of administrative notice for any reasonable articulated basis.  However, no Social Security Administration adjudicators may accept testimony that is based on underlying assumptions or definitions that are inconsistent with regulatory policies.  Evidence That Conflicts with SSA Policy.   The regulatory policies are explained in POMS.   Social Security Ruling 13-2p.

The forewarned, the ALJ or the attorneys representing the agency before a court will claim that the vocational expert has special expertise that permits them to point to jobs and occupations that do not require interacting with coworkers or supervisors on any significant level.  We do not leave commonsense at the door to the hearing office.  The Social Security Administration adjudicates nearly 3 million disability claims every year.  Based upon that vast experience, the agency publishes POMS and sets out agency policy that an individual who cannot tolerate direction and criticism from supervisors, ask questions of supervisors, or get a passing grade in the "plays well with others" requirement of work activity — that person cannot engage in a function that is critical to performing unskilled work.  A vocational expert may be entitled to her opinion, but she is not entitled to her own national economy.

The Fallacy of the Labor Value Matrix - Contingency Fees

I start with the assumption that a "lawyer's time and advice are his stock in trade."  Abraham Lincoln.  Lincoln identified two components that a lawyer sells:  time; and advice.  They represent two different commodities that do not share a correlation.  The problem comes in the value of time spent by a lawyer.

Time does not Determine Value

The value of services provided to a client does not depend on the amount of time that a lawyer spends on an endeavor.  Rather, the time that an endeavor requires may determine that the value conferred is not worth the expense.  Time does not correlate to value.

Time correlates to complexity or lack of skill of the practitioner.  The more complex a matter, the more time it will require.  That provides a direct correlation between complexity and time.  The more experienced and adept the lawyer, the less time the matter will require.  That provides an inverse correlation between skill and time.  Neither implicates the value conferred.

In Burlington v. Dague, the Court observed that it had held in the lodestar (reasonable time multiplied by a reasonable hourly rate) had "become the guiding light of our fee-shifting jurisprudence."  Dauge relied on Pennsylvania v. Delaware Valley Citizens' Council for Clean Air.  The Court did not hold that a lodestar represented the best measure for assessing the value conferred on the client.  Rather, the Court consistently holds that the lodestar is the beacon by which to shift fees from the loser to the winner in cases where the statute shifts fees.  The lodestar does not implicate value.

Value has Intrinsic Measurement

A client walks in with a contract proposal from a potential customer.  The contract has the potential of making the client $1,000.  The lawyer agrees to look over the contract at $300 per hour with an estimated completion time of two hours.  Is it worth the client's expense to hire the lawyer for $600 on the assumption that the deal could make $1,000 later?  Probably not.  The value of the services anticipated absorbs most of the value in expectation.

Same situation but the client anticipates making $1 million.  The lawyer agrees to look over the contract proposal at $300 per hour and anticipates that the project will take 33.3 hours of time.  The client assesses the $10,000 anticipated charges against the $1 million in anticipated net income.  Same type of services but a much higher estimated cost but the client sees the value in the cost of the services as 1% of the anticipated benefit.

In neither situation does the amount of time dictate the value to the client.  The value is in the deal, not in the ancillary cost of the services provided.  In the Dague and Delaware Valley scenarios, the client opts to retain the services of the lawyer, value be damned, because someone else is going to have to pay the bill.

The idea that labor determines or influences value has its roots in ancient civilization.  David Ricardo, Karl Marx, and others advocated that labor determines or influences value.  But the person digging a ditch for drainage and the person digging the ditch to extract gold from the hill have the same effort involved but the prospector provides more value and will receive more compensation -- if they find gold -- than the ditch digger providing drainage.  The property owner assesses value of the ditch and makes a decision to excavate based on the exchange value of the services versus the change in the property.  The prospector speculates on the gold market and the chance of finding more gold.

Time does not determine value.  Rather, value determines whether to invest time.  Scott Turow makes a powerful pitch that The Billable Hour Must Die.  The time equals value of services model encourages investing more time on cases or issues that don't warrant more time. 

Contingent Fee Rests on Value

Contingency fees are common in the United States.  They open the doors of the courthouse to those that cannot afford to pay for legal services on an hourly basis by exchanging part of the value of the claim for the lawyer's time and advice.  No reasonable lawyer would exchange time and advice for a claim that had little or no value (absent the market-distorting impact of fee shifting).  The presence of time and advice from lawyers depends on the presence of value.  The time and advice do not create the value but arise because of the value.

There are several arenas where the lawyer and the client may not take a joint interest in the value of the services provided.  ABA Model Rule 1.5(d) provides

(d) A lawyer shall not enter into an arrangement for, charge, or collect:

(1) any fee in a domestic relations matter, the payment or amount of which is contingent upon the securing of a divorce or upon the amount of alimony or support, or property settlement in lieu thereof; or

(2) a contingent fee for representing a defendant in a criminal case.

Outside of those identified areas of law, contingency fees are generally ethical under the ABA Model Rules. 

The contingency model tracks value and makes the lawyer a partner in the outcome of the claim.  The lawyer stops working on claims that have no perceivable merit because of the improbability of receiving value in the end.  Lawyers will take cases that have perceived value assessing the time expected to be invested against that eventual outcome.  Again, time does not create or transfer value but operates as a lever counseling for or against cases with high time expectations and low value.  Conversely, time counsels in favor of claims that have relatively low time expectations and relatively high value.