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Johnson v. Berryhill

United States District Court, D. Kansas

December 20, 2017

JAMES EDWARD JOHNSON, Plaintiff,
v.
NANCY A. BERRYHILL, Acting Commissioner of Social Security, [1]Defendant.

          MEMORANDUM AND ORDER

          Sam A. Crow, U.S. District Senior Judge.

         This is an action reviewing the final decision of the Commissioner of Social Security denying the plaintiff disability insurance benefits and supplemental security income payments. The matter has been fully briefed by the parties.

         I. General legal standards

         The court's standard of review is set forth in 42 U.S.C. § 405(g), which provides that "the findings of the Commissioner as to any fact, if supported by substantial evidence, shall be conclusive." The court should review the Commissioner's decision to determine only whether the decision was supported by substantial evidence and whether the Commissioner applied the correct legal standards. Glenn v. Shalala, 21 F.3d 983, 984 (10th Cir. 1994). Substantial evidence requires more than a scintilla, but less than a preponderance, and is satisfied by such evidence that a reasonable mind might accept to support the conclusion. The determination of whether substantial evidence supports the Commissioner's decision is not simply a quantitative exercise, for evidence is not substantial if it is overwhelmed by other evidence or if it really constitutes mere conclusion. Ray v. Bowen, 865 F.2d 222, 224 (10th Cir. 1989). Although the court is not to reweigh the evidence, the findings of the Commissioner will not be mechanically accepted. Nor will the findings be affirmed by isolating facts and labeling them substantial evidence, as the court must scrutinize the entire record in determining whether the Commissioner's conclusions are rational. Graham v. Sullivan, 794 F.Supp. 1045, 1047 (D. Kan. 1992). The court should examine the record as a whole, including whatever in the record fairly detracts from the weight of the Commissioner's decision and, on that basis, determine if the substantiality of the evidence test has been met. Glenn, 21 F.3d at 984.

         The Social Security Act provides that an individual shall be determined to be under a disability only if the claimant can establish that they have a physical or mental impairment expected to result in death or last for a continuous period of twelve months which prevents the claimant from engaging in substantial gainful activity (SGA). The claimant's physical or mental impairment or impairments must be of such severity that they are not only unable to perform their previous work but cannot, considering their age, education, and work experience, engage in any other kind of substantial gainful work which exists in the national economy. 42 U.S.C. § 423(d).

         The Commissioner has established a five-step sequential evaluation process to determine disability. If at any step a finding of disability or non-disability can be made, the Commissioner will not review the claim further. At step one, the agency will find non-disability unless the claimant can show that he or she is not working at a “substantial gainful activity.” At step two, the agency will find non-disability unless the claimant shows that he or she has a “severe impairment, ” which is defined as any “impairment or combination of impairments which significantly limits [the claimant's] physical or mental ability to do basic work activities.” At step three, the agency determines whether the impairment which enabled the claimant to survive step two is on the list of impairments presumed severe enough to render one disabled. If the claimant's impairment does not meet or equal a listed impairment, the inquiry proceeds to step four, at which the agency assesses whether the claimant can do his or her previous work; unless the claimant shows that he or she cannot perform their previous work, they are determined not to be disabled. If the claimant survives step four, the fifth and final step requires the agency to consider vocational factors (the claimant's age, education, and past work experience) and to determine whether the claimant is capable of performing other jobs existing in significant numbers in the national economy. Barnhart v. Thomas, 124 S.Ct. 376, 379-380 (2003).

         The claimant bears the burden of proof through step four of the analysis. Nielson v. Sullivan, 992 F.2d 1118, 1120 (10thCir. 1993). At step five, the burden shifts to the Commissioner to show that the claimant can perform other work that exists in the national economy. Nielson, 992 F.2d at 1120; Thompson v. Sullivan, 987 F.2d 1482, 1487 (10th Cir. 1993). The Commissioner meets this burden if the decision is supported by substantial evidence. Thompson, 987 F.2d at 1487.

         Before going from step three to step four, the agency will assess the claimant's residual functional capacity (RFC). This RFC assessment is used to evaluate the claim at both step four and step five. 20 C.F.R. §§ 404.1520(a)(4), 404.1520(e, f, g); 416.920(a)(4), 416.920(e, f, g).

         II. History of case

         On April 28, 2015, administrative law judge (ALJ) Michael Comisky issued his decision (R. at 18-32). Plaintiff alleged that he has been disabled since October 24, 1990 (R. at 18). Plaintiff was found to be disabled on May 28, 1991. Plaintiff's disability was determined to continue on June 18, 1999 (R. at 18).

         On January 25, 2013, defendant notified the plaintiff that it had been determined that his condition was not severe enough to have been considered disabling and the previous determination that he was disabled was being changed. Plaintiff appealed this decision, and the case was heard by the above-listed ALJ (R. at 18). The ALJ issued his decision on April 28, 2015 (R. at 32).

         Plaintiff is insured for disability insurance benefits through March 31, 2016 (R. at 21). At step one, the ALJ found that plaintiff has not engaged in substantial gainful activity since the alleged onset date (R. at 21). At step two, the ALJ found that plaintiff has severe impairments (R. at 21). At step three, the ALJ determined that plaintiff's impairments do not meet or equal a listed impairment (R. at 22). After determining plaintiff's RFC (R. at 23-24), the ALJ found at step four that plaintiff is unable to perform any past relevant work (R. at 29). At step five, the ALJ found that plaintiff could perform other jobs that exist in significant numbers in the national economy (R. at 30). Reopening of the prior allowance dated May 28, 1991 was found to be supported by fraud having been committed in this case (R. at 31). Therefore, the ALJ concluded that plaintiff was not disabled (R. at 31-32).

         The Appeals Council reviewed the ALJ decision, and issued its own decision on November 22, 2016 (R. at 6). The Appeals Council did not agree with the ALJ that fraud was committed. Rather, the Appeals Council found that plaintiff committed acts of “similar fault” (R. at 6F-6H). The Appeals Council found that plaintiff's date last insured was September 30, 1993 (R. at 6I, n.2). At step one, the Appeals Council found that plaintiff engaged in substantial gainful activity beginning on June 16, 2008. At step two, the Appeals Council found that plaintiff had severe impairments, and at step three found that plaintiff's impairments do not meet or equal a listed impairment. After determining plaintiff's RFC, the Appeals Council found at step four that plaintiff is unable to perform past relevant work (R. at 6I). At step five, the Appeals Council found that plaintiff could perform other work that exists in significant numbers in the national economy. Therefore, the Appeals Council concluded that plaintiff was not disabled based on his application of September 12, 1990 (R. at 6J).

         III. Did the Appeals Council err in its decision that the disability determination of May 28, 1991 should be reopened because it was obtained by similar fault?

         A decision that a claimant is disabled may be reopened at any time if it was obtained by fraud or similar fault. 20 C.F.R. §§ 404.988(c)(1); 416.1488(c). Similar fault is defined as an: (1) incorrect or incomplete statement that is material to the determination is knowingly made; or (2) information that is material to the determination is knowingly concealed. 42 U.S.C. § 405(u)(2); SSR 16-1p, 2016 WL 1029284 at *3; SSR 16-2p, 2016 WL 1029285 at *3. Material is defined as a statement or information, or an omission from a statement or information that could influence the agency in determining entitlement to benefits. Knowingly describes a person's awareness or understanding regarding the correctness or completeness of the information he or she provides, or the materiality of the information he or she conceals from the agency. SSR 16-1p, 2016 WL 1029284 at *4; SSR 16-2p, 2016 WL 1029285 at *4.

         The Commissioner shall disregard any evidence if there is reason to believe that fraud or similar fault was involved in the providing of such evidence. 42 U.S.C. § 405(u)(1)(B). If, after redetermining entitlement to or eligibility for benefits, the agency determines that without the disregarded evidence, the evidence does not support entitlement or eligibility, the agency may terminate such entitlement or eligibility and may treat benefits paid based on such evidence as overpayment. SSR 16-2p, 2016 WL 1029285 at *2; see 42 U.S.C. § 405(u)(3).

         Plaintiff argues that reopening of the determination that plaintiff was disabled in 1991 is precluded on the basis of res judicata. Plaintiff notes that on June 18, 1999, the Commissioner informed the plaintiff that it had recently reviewed the evidence in his disability claim and had determined that his disability was continuing (R. at 98). Plaintiff contends that this decision to continue disability benefits precludes reopening of the 1991 disability determination (Doc. 14 at 22-23).

         Res judicata applies in the social security context when there has been a previous determination or decision about the claimant's rights on the same facts and on the same issue or issues, and this previous determination has become final by either administrative or judicial action. Poppa v. Astrue, 569 F.3d 1167, 1170 (10th Cir. 2009); 20 C.F.R. §§ 404.957(c)(1), 416.1457(c)(1).

         However, as noted above, a decision that a claimant is disabled “may be reopened at any time if it was obtained by fraud or similar fault.” Good cause for reopening exists if new and material evidence is furnished. 20 C.F.R. § 404.989(a)(1). The Commissioner alleges that new and material evidence which was not available in 1999 justified reopening this case.[2] Thus, this case can be distinguished from the case of Hulett v. Chater, 1997 WL 8026 at *2 (10th Cir. Jan. 10, 1996), in which the Secretary did not allege the existence of any new indices of fraud that she currently possessed which were unavailable when the Secretary made the prior continuation determinations.

         The court will next address the evidence regarding whether the disability determination in 1991 was obtained by similar fault. Defendant had made an initial determination that plaintiff was not disabled on March 15, 1991 (R. at 33). This had followed psychological evaluations of November 15, 1990 by Dr. Vandenberg (R. at 196-197), and by Dr. Day on February 12, 1991 (R. at 203-205). A psychological assessment on March 12, 1991, which reviewed the above evaluations, found that plaintiff had only a slight degree of limitation in 3 functional areas (R. at 213), and a mental RFC assessment of that same date showed moderate limitations in only 3 out of 20 categories (R. at 215-216).

         On May 15, 1991, another psychological evaluation was performed by Dr. FitzGerald. He performed a Wechsler Adult Intelligence (IQ) test, a Benton Visual Retention Test, and a Wechsler Memory Scale test on plaintiff. The IQ test showed a verbal IQ of 60, a performance IQ of 51 and full scale IQ of 52. On the Wechsler/IQ test, Dr. FitzGerald noted that plaintiff's performance subscales were affected by time and an inability to comprehend task requirements. The Benton test was marked by omissions, perseverations, and size errors and was moderately suggestive of organic impairment. The results of the memory scale were inconclusive. Plaintiff was unable or unwilling to complete the subtests and responded repeatedly “I don't know, ” or “don't remember that.” Dr. FitzGerald concluded that plaintiff was mentally retarded (R. at 219-220).

         On May 28, 1991, defendant concluded that plaintiff was disabled as of October 24, 1990 because of mental retardation; plaintiff was found to meet listed impairment 12.05B. Dr. FitzGerald's report was cited as the basis for deciding plaintiff's claim (R. at 34, 104-105, 224).

         Plaintiff submitted to a more recent psychological assessment on November 13, 2012 with Dr. Neufeld (R. at 311-315). Dr. Neufeld ...


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