The opinion of the court was delivered by: SAND
HONORABLE LEONARD B. SAND, U. S.D.J.
Plaintiffs, Theresa Stieberger and the City of New York, have instituted this action to challenge two policies of the United States Department of Health and Human Services ("HHS") and the Social Security Administration ("SSA"), as implemented by the abovenamed defendants.
Plaintiffs challenge: (1) the "nonacquiescence" policy, under which Administrative Law Judges ("ALJs") have been instructed to disregard the decisions of federal courts within the circuit in which they sit when those decisions conflict with the Secretary's own policies; and (2) the "Bellmon Review" policy, under which, inter alia, the decisions of ALJs with a high percentage of pro-claimant determinations in disability benefit cases were subject to agency-initiated review by the agency's Appeals Council.
Plaintiffs contend that the non-acquiescence policy has deprived them of access to impartial and decisionally independent ALJs and has unlawfully discriminated between those claimants who are able to secure judicial review and those who do not have access to judicial review in violation of the Administrative Procedure Act ("APA"), the Social Security Act, the Due Process Clause of the Fifth Amendment to the United States Constitution, and the principle of separation of powers. Plaintiffs contend that the Bellmon Review policy has deprived them of access to impartial and decisionally independent ALJs in violation of the APA, the Social Security Act, and the Due Process Clause of the Fifth Amendment to the United States Constitution and has unlawfully discriminated against disability benefits claimants in violation of the Due Process Clause of the Fifth Amendment
by subjecting ALJ decisions to Bellmon Review because such decisions are unfavorable to the government. Plaintiffs seek declaratory and injunctive relief pursuant to 28 U.S.C. §§ 2201 and 2202.
Six motions are presently pending before this Court. Plaintiffs' four motions were filed on October 23, 1984. First, Patricia Happy and Angel Vega have moved pursuant to F.R.Civ.P. 24 to intervene. Second, Milagros Sullivan and Harold Johnson have moved pursuant to F.R.Civ.P. 42 to have their cases consolidated with the above-captioned action. Third, plaintiffs
have moved pursuant to F.R.Civ.P. 23 to certify this action as a class action. Fourth, plaintiffs have moved pursuant to F.R.Civ.P. 65 for a preliminary injunction (1) enjoining defendants from continuing their Bellmon Review and non-acquiescence policies, (2) notifying agency employees and their agents who adjudicate disability claims in New york that they are to decide cases in accordance with the precedents of the United States Court of Appeals for the Second Circuit, (3) an order granting the individual named plaintiffs interim benefits pending final judgment;
and (4) ordering defendants to (a) identify class members, (b) notify them that their denial or termination of benefits may have been wrongful,
and (c) develop a procedure for claimants to renew their claims.
On October 4, 1984, defendants moved pursuant to 42 U.S.C. § 405(g) to remand plaintiff Stieberger's case to the Secretary. Defendants subsequently moved on February 4, 1985 to dismiss pursuant to F.R.Civ.P. 12(b)(1) and (6) or alternatively for summary judgment pursuant to F.R.Civ.P. 56. Defendants' motion to dismiss or for summary judgment seeks to dismiss the Bellmon Review claim in its entirety based on lack of standing, mootness, waiver, and on the merits, and seeks to dismiss the nonacquiescence claim on mootness grounds based on alleged congressional ratification of the Secretary's policy for evaluating the opinion of a claimant's treating physician. See Defendants' Memorandum of Law (i) In Support of Motion to Dismiss, etc., at 2, 12-24.
On February 4, 1985, oral argument was held on the aforementioned motions. At that time, the Court directed counsel for defendants to secure a review of the SSA's non-acquiescence policy by officials at the highest levels of HHS and to submit a supplemental memorandum concerning the legal issues raised by the policy. See Transcript of Oral Argument ("Tr. I") 52, 58, 64. After a review of the policy by the Undersecretary of HHS, the Acting Commissioner of Social Security and the Acting General Counsel of HHS, defendants filed their Memorandum Concerning Instruction to Administrative Law Judges on March 4, 1985. The Court also requested plaintiffs to address the issue of the scope of the proposed class and to give consideration to whether the proposed class definition could be narrowed so as to exclude claimants whose claims were denied for reasons unrelated to the issues in this case. Tr. I 22-23.
By order dated March 8, 1985, plaintiffs' class certification and preliminary injunction motions were referred to Magistrate Naomi Reice Buchwald for report and recommendation. After conducting an oral argument on April 1, 1985, see Transcript of Oral Argument ("Tr. II"), the Magistrate issued her report and recommendation on May 8, 1985. The Magistrate recommended that plaintiffs' motion for class certification be granted and that plaintiffs' motion for preliminary injunctive relief enjoining defendants from continued implementation of the Bellmon Review and non-acquiescence policies be granted as well. The Magistrate also recommended that defendants be ordered to identify with reasonable promptness all members of the class.
On June 3, 1985, defendants filed objections to virtually all of the Magistrate's Report.
Plaintiffs filed responsive papers on June 21, 1985, in which they essentially objected to that portion of the Magistrate's Report concerning defendants' alleged non-acquiescence in Second Circuit predecent concerning the evaluation of a claimant's complaints of pain. Defendants filed a supplemental memorandum on July 15, 1985 concerning recent developments in two cases which are relevant to this action and a reply memorandum on July 16, 1985 in response to plaintiffs' responsive papers. Pursuant to 28 U.S.C. § 636, we have reviewed de novo those portions of the Report to which objection has been made.
For the reasons set forth below, (1) Patricia Happy's motion to intervene is granted and Angel Vega's motion to intervene is dismissed as moot; (2) the motion to consolidate the cases of Milagros Sullivan and Harold Johnson with this action is granted; (3) the motion to certify this action as a class action is granted as set forth in the Order issued in conjunction with this Opinion (Appendix A); (4) the motion to enjoin the defendants' current non-acquiescence policy is granted under the terms set forth in this Court's Order; and (5) the motion to enjoin the defendants' current Bellmon Review program is denied. Defendants' motion to dismiss, or in the alternative for summary judgment, is denied, and defendants' motion to remand plaintiff Stieberger is denied.
In light of the Magistrate's thorough and helpful description of the facts and administrative review process and the absence of objections thereto, we hereby adopt and set forth this portion of the Magistrate's Report:
The Individual Plaintiffs
"This action was originally commenced by plaintiff Theresa Stieberger pro se on February 23, 1984. On August 3, 1984, before defendants had answered the Complaint, an Amended Complaint was filed as of right by plaintiff Stieberger, individually, and on behalf of all similarly situated persons who had been denied disability benefits, and by the City of New York. Two other individual plaintiffs, Patricia Happy and Angel Vega, moved to intervene in this action on behalf of themselves and all others similarly situated. In addition, individual plaintiffs Milagros Sullivan and Harold Johnson seek to have their cases consolidated with this pending action.
Plaintiffs assert that Judge Sand's order granting interim benefits constitutes a de facto denial of defendants' motion for remand filed on October 4, 1984 and a grant of the motions for intervention and consolidation. Tr. II 97-98.) A brief description of the individual plaintiffs and their claims follow.
"Theresa Stieberger is 54 years old, and was first given SSI benefits because of mental problems in 1974. In 1978, she missed an appointment with a consulting physician because her son was ill, and her benefits were cut off. Not allowed to reapply immediately, she reapplied on April 7, 1983 for SSI and SSDI benefits. Her applications were rejected on June 21, 1983 and after two reconsiderations, she appeared pro se before an ALJ for a hearing [held in July 1983]. In August, 1983, the ALJ rendered a decision against Mrs. Stieberger. He rejected the determination of her treating physician that she was totally disabled by degenerative joint disease in the lower thoracic and lumbar spine, calcific peritendonitis of the right shoulder that prevented her from lifting her right arm, depression, and asthma. Amended Complaint, Ex. II, ALJ Decision at 3. The Appeals Council also rejected her claim. Mrs. Stieberger alleges that she is in constant pain and cannot work. Her 15 year old son does the shopping and heavy housework. They live in $237 in welfare payments and $135 in food stamps per month. See Stieberger Aff. Ex. C.
Each of the affidavits of the individual plaintiffs is annexed to the affidavit of Mary McCorry, sworn to an October 22, 1984, submitted in support of plaintiffs' notice of motions.)
" Patricia Happy suffers from severe back pain and muscle spasms caused by degenerative joint disease and a leg injury received in a motorcycle accident. Ms. Happy alleges that she is unable to cook, clean, wash, iron, or do other basic household chores. The New York Department of Social Services found her disabled and provided a housekeeper to perform those chores for her. Ms. Happy must lie in bed for most of the day. She applied for disability on August 19, 1983. After her application and request for reconsideration were rejected, she requested a hearing before an ALJ. Ms. Happy did not attend the hearing [held in May 1984] and was not presented by counsel. Plaintiffs assert that in a decision contrary to the detailed reports of Ms. Happy's treating physicians, the ALJ relied on the government physician's examination report to reject her claim on June 14, 1984. Ms. Happy's appeal to the Appeals Council was denied on January 23, 1985. See Happy Aff. Ex. D.
"Angel Vega is an eleven-year old retarded boy with severe asthma and emotional problems. His mother applied for SSI on his behalf on October 28, 1982. In February, 1983 the SSA rejected the application and rejected his request for reconsideration in November, 1983. Denying his request after a hearing on July 2, 1984, an ALJ apparently rejected the uncontradicted reports of Angel's treating physicians. He has received no payments, however, and his public assistance and Medicaid were terminated as of the date of notification. Angel, his mother, father, and his three siblings live on $78 for rent and $156 for the rest of their expenses every 15 days, plus $193 in food stamps every month. See Vega Aff. Ex. E.
Because Angel has not received any payment on his award, his counsel has requested that his claim not be found moot. Kubitschek Aff., sworn to on January 31, 1985.)
"Plaintiff Milagros Sullivan suffers from constant pain in the lower right back and right leg caused by the spinal tap administered during childbirth in 1972. Her treating physician testified that she lives in acute pain, is unable to move and is confined to bed. She applied for SSI on October 6, 1982. After her application and request for reconsideration were rejected, she had a hearing before an ALJ on January 17, 1984. According to plaintiffs, in a decision contrary to the findings of Ms. Sullivan's treating physician and two consulting physicians, the ALJ relied on the findings of the third consulting physician in denying her claim. The Appeals Council also rejected her claim. She and her 12 year old daughter live on $399 in public assistance and $98 in food stamps each month. See Sullivan Aff. Ex. F.
"Harold Johnson was polymyositis, a rare disease that causes extreme fatigue, muscle weakness and shortness of breath. Mr. Johnson applied for SSI on December 2, 1982. His application and request for reconsideration were rejected by SSA. After a hearing, on March 30, 1984, plaintiffs assert that the ALJ rejected his claim without directly confronting the treating physician's findings that he was disabled. The Appeals Council denied his request on September 11, 1984. Mr. Johnson lives on welfare payments of $268 monthly, $60 food stamps monthly, and on money borrowed from his church. See Johnson, Aff. Ex. G.
The Administrative Review Process
"To place this case in context, we will briefly describe the administrative process for reviewing applications for disability benefits, which is essentially the same whether the request is for Social Security Disability Insurance ("SSDI") under Title II of the Act or for Supplemental Security Income ("SSI") under Title XVI of the Act. The administrative process for determining social security claims as established by the statute and implementing regulations consists of four levels of administrative consideration, followed by three levels of judicial review.
"First, the claim is reviewed by a state agency. 42 U.S.C. § 421(a). The Secretary may on her own motion review the state agency's initial determination of disability or lack of disability, either before or after any action is taken to implement that initial determination. 42 U.S.C. § 421(c).
"Next, the claimant may ask that the state agency to consider the claim de novo, with the decision upon reconsideration again reviewable by the Social Security Administration. 20 C.F.R. § 404.907 (1982).
If the initial determination is that the disability has ceased due to medical reasons, and the claimant has a right to a hearing on the same issue in connection with a claim for SSI, the claimant need not request reconsideration, but may request a hearing right after the initial determination. 20 C.F.R. § 404.907 (1982).)
"If the claimant is dissatisfied with the reconsideration outcome, he may request a de novo hearing before an ALJ. At the hearing, the claimant may appear in person, submit new evidence, examine the evidence used in making the determination or decision under review, and present and question witnesses. The hearing is not adversarial, and the ALJ who conducts it may ask the claimant questions. At the hearing, the SSA is not represented by counsel. The claimant may be represented by counsel or other representative such as a paralegal. Mathews v. Eldridge, 424 U.S. 319, 339, 47 L. Ed. 2d 18, 96 S. Ct. 893 (1976); 20 C.F.R. § 404.950. Whether or not the claimant is represented by counsel or other representative, the ALJ has an affirmative duty to inquire into all the matters at issue, so as to fully develop the record. 20 C.F.R. § 416.1444; Mimms v. Heckler, 750 F.2d 180 (2d Cir. 1984) (duty where the claimant is pro se); Decker v. Harris, 647 F.2d 291 (2d Cir. 1981) (duty remains where counsel present). The ALJ's decision is to be based on the hearing record. 20 C.F.R. § 404.929.
"The fourth level of administrative consideration is review of the ALJ's decision by the Appeals Council in the Office of Hearings and Appeals, either at the claimant's request or sua sponte. The latter form of review is known as "own motion" review. 20 C.F.R. §§ 404.967, 404.1467, 416.1468. The Appeals Council may deny or dismiss the request for review, or it may grant the request and either issue a decision or remand the case to an ALJ. 20 C.F.R. § 416.1467. The Appeals Council may consider evidence beyond that which was before the ALJ. 20 C.F.R. § 404.976(b). If the Appeals Council decides that the case raises an important issue of law or policy or that oral argument would be helpful, it may grant a claimant leave to present oral argument. 20 C.F.R. 404.976(c). The Appeals Council's decision, or the ALJ's decision if the request for review is denied, is the final administrative decision. 20 C.F.R. 404.981. The claimant may appeal this decision in federal district court, 42 U.S.C. § 405(g). The district court's decision is subject to further review in the same manner as other civil actions."
III. MOTIONS CONCERNING INDIVIDUAL NAMED PLAINTIFFS
A. Defendants' Motion to Remand (Stieberger)
Prior to plaintiffs' motions for class certification and preliminary injunctive relief, defendants moved to remand plaintiff Stieberger's case to the Secretary pursuant to 42 U.S.C. § 405(g). This section provides in pertinent part that the "Court may, on motion of the Secretary made for good cause shown before he filed his answer, remand the case to the Secretary for further action by the Secretary ...." Defendants note that Stieberger is a member of the class in Dixon v. Heckler, 589 F. Supp. 1494 (S.D.N.Y. 1984), in which the Court invalidated a number of the Secretary's regulatory provisions relating to the assessment of the severity of impairments. Defendants argue that this Court should remand plaintiff Stieberger's case pursuant to the relief accorded members of the Dixon class.
This motion is denied. First, a remand to the Secretary is not the only form of relief available to members of the Dixon class. The order certifying the class in Dixon expressly provides that persons such as Stieberger may continue individual court actions such as this one. See Dixon v. Heckler, No. 83-7001 (MEL), Order, at 11-12, [P] 19 (S.D.N.Y. July 25, 1984) "Nothing in this order shall be construed as precluding members of the plaintiff class from obtaining greater relief on alternative grounds... Nothing in this order shall be construed as precluding class members who choose to proceed with their individual court cases from seeking preliminary relief in those cases.") (annexed to Plaintiffs' Memo in Opposition to Remand). While Stieberger could also have chosen to have her case remanded, see id. at 8, [P] 10, this is an option which she has chosen not to exercise.
Second, were the only action taken by this Court with respect to Stieberger a remand, she would continue to be subject to the very policies of which she complains in this action -- non-acquiescence and Bellmon Review. Such a remand might well be an exercise in futility.
This Court will be in a better position to determine the appropriate relief, if any, to grant plaintiffs at the completion of these proceedings on the merits. In addition to the above-quoted portion of § 405(g), this subjection also provides in pertinent part that "[t]he court shall have power to enter, upon the pleadings and transcript of the record, a judgment affirming, modifying, or reversing the decision of the Secretary, with or without remanding the cause for a hearing." Defendant's suggestion that this Court remand this case to the Secretary prior to review of the administrative record and over the objection of plaintiff is clearly premature. Indeed, although defendants suggest that a remand is appropriate when the Secretary has applied an erroneous legal standard, see, e.g., Marcus v. Califano, 615 F.2d 23 (2d Cir. 1979), plaintiff contends that the evidence of her disability is so persuasive that outright reversal of the Secretary's unfavorable determination is warranted. See, e.g., Parker v. Harris, 626 F.2d 225 (2d Cir. 1980).
The proper remedy which may eventually be awarded to plaintiff Stieberger, as well as to other members of the certified class, is best formulated at the completion of these proceedings.
Accordingly, defendants' motion to remand is denied.
B. Motions to Intervene (Happy, Vega)
Patricia Happy and Angel Vega have moved to intervene in this action. Defendants initially objected to Happy's motion based on her failure to exhaust administrative review procedures. At that time, happy's request for reconsideration was pending before the Appeals Council. On January 23, 1985, her request was denied. According to plaintiffs, defendants no longer oppose Happy's motion to intervene. See Plaintiffs' Reply Memo, at 31. Defendants have not indicated a position to the contrary. Happy's claims are the same in relevant respects to those of other plaintiffs and intervention will not delay or prejudice the adjudication of the rights of the original parties. Accordingly, Happy's motion to intervene is granted.
Defendants contend that Vega's receipt of a favorable determination by the Appeals Council on December 10, 1984 renders his challenge moot. In response to this contention, Vega's attorney submitted an affidavit stating that, as of January 31, 1985, Vega had not yet received any disability benefit payments from HHS, although his other government benefits were terminated as soon as he received a favorable disability determination. Kubitschek Aff. [P] 5. Subsequently, this Court ordered the Secretary to pay SSI benefits to Vega in accordance with her administrative determination of eligibility. See Order dated February 11, 1985. Accordingly, Vega's motion to intervene is dismissed as moot without prejudice to Vega's right, if any, to recover any amounts to which he is entitled for the period during which he received neither SSI benefits nor state public assistance.
C. Motions to Consolidate (Sullivan Johnson)
Plaintiffs Milagros Sullivan has moved to consolidate her pending individual action, 84 Civ. 5804 (GLG), with this action. Plaintiff Harold Johnson has also moved to consolidate his pending individual action, 84 Civ. 7613 (LBS), with this action. Defendants do not oppose these motions. See Defendants' Memo in Support of Motion to Dismiss, at 3. Both plaintiffs challenge the Bellmon Review and non-acquiescence policies of defendants. Both allege that the ALJ who reviewed his or her disability claim gave insufficient weight to the opinion of his or her treating physician. See Kubitschek Aff. [P][P] 16-21; Sullivan Aff. [P][P] 8-9; Johnson Aff. [P][P] 6-7. Plaintiffs' motions to consolidate are granted.
Plaintiffs have moved pursuant to F.R.Civ.P. 23(a) and (b)(2) for certification of this action as a class action. Plaintiffs originally proposed that the class consist of
All New York residents whose claims for benefits or continuation of benefits have been or will be denied or terminated pursuant to hearings before administrative law judge since October 1, 1981, and whose benefits have not been granted or restored through subsequent appeals.
See Kubitschek Aff. [P] 22.
In response to questions raised by the Court concerning the scope of the class, plaintiffs also proposed a narrower definition of the class, namely,
All New York residents whose claims for benefits or continuation of benefits have been or will be denied or terminated pursuant to hearings before administrative law judges since October 1, 1981, based on a determination that they do not have a disability that prevents them from engaging in substantial gainful activity; and whose benefits have not been granted or restored through subsequent appeals.
Id. at 11. According to plaintiffs, this narrower class definition would exclude
All persons denied benefits based on a determination that they were engaged in substantial gainful activity, despite their impairment.
All persons denied benefits based on a determination of financial ineligibility (e.g., under SSI), expiration of entitlement period (e.g., under SSDI), or any other ineligibility requirement unrelated to their medical impairment or residual functional capacity to work.$
%Id. at 12. According to plaintiffs, the latter two groups of cases "are the kinds of cases that are less likely to have resulted in wrongful denials." Id.
Two overarching determinations must be made by the Court at this stage of the litigation: first, whether this action is properly maintainable as a class action; and second, which claimants are properly includable as members of the class.
Rule 23 governs our analysis of the first issue. Plaintiffs assert, Magistrate Buchwald found, and defendants do not contest, that this action meets the requirements of F.R.Civ.P. 23 and is thus properly maintainable as a class action. Plaintiffs allege that thousands of claimants have been affected by the challenged policies, see McCorry Aff. [P][P] 7, Kubitschek Aff. [P] 23, thus satisfying the numerosity requirement. The commonality requirement is satisfied since the class members all allege that their disability claims were decided by ALJs whose allowance decisions were subject to a discriminatory review system and who were instructed by the SSA to disregard circuit court precedents when in conflict with the Secretary's own policy, in violation of their constitutional and statutory rights. Common questions also predominate since plaintiffs seek only to invalidate the challenged policies and obtain administrative redeterminations of their disability claims rather than an individualized consideration of the underlying merits of their disability claims by this Court. The typically requirement is met since the named plaintiffs all allege that their disability claims were rejected by ALJs while the Bellmon Review program was in effect and on the basis of SSA rules which conflicted with precedents of the Second Circuit. The adequacy requirement is met since the interests of the named plaintiffs are not antagonistic to those of the class and the relief sought for class representatives (with the possible exception of plaintiff Stieberger; see note 10 supra) unnamed members is identical. In addition, the qualifications of the plaintiffs' attorneys are undisputed. The action is properly maintainable as a 23(b)(2) class action since defendants have acted "on grounds generally applicable to the class" through implementation of the Bellmon Review program and the nonacquiescence policy and injunctive relief is requested with respect to the class as a whole. The requirements of F. R.Civ.P. 23(a) and (b)(2) have thus been satisfied, and plaintiffs' motion for class certification is granted as set forth in the Order issued in conjunction with this Opinion. See Appendix A to this Opinion. This class certification is granted subject to alteration or amendment by the Court at a future stage of these proceedings, if appropriate. F.R.Civ.P. 23(c)(1); see Holden v. Heckler, 584 F. Supp. 463, 489 (N.D.Ohio 1984); Schisler v. Heckler, 80 Civ. 572E, slip op. at 14 (W.D.N.Y. Dec. 5, 1984) (annexed to Plaintiffs' Class Certification Memo), appeal argued, No. 85-6092, 6096 (2d Cir. Aug. 14, 1985).
The jurisdictional issues raised by defendants relate primarily to the proper scope of the class. Defendants contend that the class should be limited to those claimants who satisfy the requirements of 42 U.S.C. § 405(g), and that mandamus jurisdiction under 28 U.S.C. § 1361 is unavailable. We consider each of these contentions in turn.
A. Social Security Act Jurisdiction: Section 405(g)
Section 405(g) provides in pertinent part that:
Any individual, after any final decision of the Secretary made after a hearing to which he was a party, irrespective of the amount in controlvery, may obtain a review of such determinetion by a civil action commenced within sixty days after the mailing such further time as the Secretary may allow... The Court shall have the power to enter, upon the pleadings and transcript of the record, a judgment affirming, modifying, or reversing the decision of the Secretary, with or without remanding the cause for a rehearing....
The "final decision" requirement consists of two elements -- a jurisdictional, non-waivable requirement that a claim for benefits has been presented to the Secretary, and a waivable requirement that the administrative remedies prescribed by the Secretary have been exhausted. See Mathews v. Eldridge, 424 U.S. 319, 328-30, 47 L. Ed. 2d 18, 96 S. Ct. 893 (1976); Weinberger v. Salfi, 422 U.S. 749, 764-65, 45 L. Ed. 2d 522, 95 S. Ct. 2457 (1975); City of New York v. Heckler, 742 F.2d 729, 734 (2d Cir. 1984), petition for rehearing denied, 755 F.2d 31, partial stay pending cert. granted, 473 U.S. 902, 105 S. Ct. 3552, 87 L. Ed. 2d 671 (1985).
Defendants contend that the class should not include claimants who have failed to (1) present their claims to the Secretary, (2) exhaust their administrative remedies, or (3) seek judicial review of the Secretary's decision within the sixty day period delineated in the statute.
The presentment requirement is satisfied when an application for benefits is made to the Secretary or, in the case of a claimant whose benefits have been terminated, notification is given to the agency that the claimant is still disabled. Mental Health Association of Minnesota v. Heckler, 720 F.2d 965, 969 (8th Cir. 1983). According to the definition of the class, class members include those claimants whose applications for benefits or the continuation of benefits have been or will be denied or terminated pursuant to hearings before ALJs and unsuccessful appeals to the Appeals Council. This is clearly sufficient to satisfy the presentment requirement of § 405(g). See Mathews v. Eldridge, supra, 424 U.S. at 329 (presentment element satisfied when claimant asserts to administrative agency that "benefits should not be terminated because [claimant is] still disabled"); City of New York v. Heckler, supra, 742 F.2d at 735; Jones v. Califano, 576 F.2d 12, 18 (2d Cir. 1978) ("It is undisputed that [plaintiffs], by filing claims with the SSA, have satisfied the non-waivable requirement."); Dixon v. Heckler, 589 F. Supp. 1494, 1500 (S.D.N.Y. 1984); cf. Heckler v. Lopez, 463 U.S. 1328, 1335, 77 L. Ed. 2d 1431, 104 S. Ct. 10 (1983) (Rehnquist, J., as Circuit Justice) (questioning whether presentment requirement satisfied by "individuals who have never questioned the initial determination that they cease to be disabled"); Wheeler v. Heckler, 719 F.2d 595 (2d Cir. 1983) (terminated recipient who fails to initiate even informal communications with SSA does not satisfy presentment requirement). Future class members, i.e., those who will have their benefits denied or terminated by ALJs and not granted or restored by the Appeals Council, will also satisfy the presentment requirement upon the occurrence of these events and thus are properly included within the class. See State of New York v. Heckler, 105 F.R.D. 118, 122-23 (S.D.N.Y. 1985); Dixon v. Heckler, supra, 589 F. Supp. at 1512.
The requirement that a claimant exhaust administrative remedies prior to seeking judicial review of an unfavorable disability determination requires the claimant to "press his claim through all designated levels of administrative review." Heckler v. Ringer, 466 U.S. 602, 104 S. Ct. 2013, 2017, 80 L. Ed. 2d 622 (1984). The exhaustion requirement is designed to preserve a variety of interest in the proper functioning of the administrative process. As the Supreme Court has described it,
Exhaustion is generally required as a matter of preventing premature interference with agency processes, so that the agency may function efficiently and so that it may have an opportuneity to correct its own errors, to afford the parties and the courts the benefit of its experience and expertise, and to compile a record which is adequate for judicial review.
Weinberger v. Salfi, supra, 422 U.S. at 765.
The exhaustion requirement of § 405(g) is waivable either by the Secretary, id. at 766-67, or by the court in appropriate circumstances. See Mathews v. Eldridge, supra, 424 U.S. at 330-32; City of New York v. Heckler, supra, 742 F.2d at 736. Judicial waiver is appropriate where plaintiffs' legal claims are collateral to the demand for benefits, where exhaustion would be futile, or where the harm suffered pending exhaustion would be irreparable. See City of New York v. Heckler, supra, 742 F.2d at 736; Mental Health Association of Minnesota v. Heckler, supra, 720 F.2d at 969-71; see also Heckler v. Ringer, supra, 104 S. Ct. at 2023.
In many Social Security class actions, the precise issue of exhaustion is whether claimants can become members of the class simply by virtue of having presented a claim for benefits to the Secretary without pursuing further administrative channels of review. See, e.g., City of New York v. Heckler, supra, 742 F.2d at 736-37; State of New York v. Heckler, supra, 105 F.R.D. at 122; Dixon v. Heckler, supra, 589 F. Supp. at 1511; Hyatt v. Heckler, 579 F. Supp. 985, 1003-04 (W.D.N.C. 1984), vacated and remanded, 757 F.2d 1455 (4th Cir. 1985); Aldrich v. Schweiker, 555 F. Supp. 1080, 1090 (D.Vt. 1982); see also Heckler v. Ringer, supra, 104 S. Ct. at 2019 (individual claimants had filed Medicare reimbursement claims with fiscal intermediary but had not exhausted further administrative remedies). Because of the manner in which the class is defined in this case, however, no such exhaustion issue arises. As already noted, the class will include those claimants whose claims for benefits have been denied or terminated pursuant to ALJ hearings and who have pursued their claims through the Appeals Council level. Thus, by definition, all claimants will have pursued all avenues of administrative relief before members of the class. At this point, administrative remedies will have been exhausted for purposes of § 405(g). See Mathews v. Eldridge, supra, 424 U.S. at 328; Lopez v. Heckler, 713 F.2d 1432, 1439 (9th Cir.) ("Some of the named plaintiffs and an unknown number of the plaintiff class have exhausted all administrative remedies and obtained final decisions; these plaintiffs indisputably are properly before the district court."), partial stay of district court order granted on other grounds, 463 U.S. 1328, 104 S. Ct. 10, 77 L. Ed. 2d 1431 (Rehnquist, J., as Circuit Justice), application to vacate stay denied, 464 U.S. 879, 104 S. Ct. 221, 78 L. Ed. 2d 217 (1983), order of district court aff'd in part and rev'd in part, 725 F.2d 1489 (9th Cir.), partial stay pending cert. granted, 104 S. Ct. 2164, judgment vacated and remanded, 469 U.S. 1082, 105 S. Ct. 583, 83 L. Ed. 2d 694 (1984), order remanding and clarifying class definition, Civ. No. 83-0697, WPG[T] (C.D.Cal. Dec. 17, 1984) (Ex. GG to Plaintiffs' Reply Memo), partial stay denied, 753 F.2d 1464 (9th Cir. 1985).
Under § 405(g), a claimant must seek judicial review of a final decision of the Secretary within sixty days of the mailing of notice of the decision to the claimant. Defendants contend that the class must therefore be limited to those claimants who received notice of their final determinations on or after June 4, 1984, i.e., claimants whose final decisions were rendered on May 30, 1984. See Dixon v. Heckler, supra, 589 F. Supp. at 1550 n.18 (class includes claimants whose final decisions were rendered sixty-five days prior to filing of complaint); Holden v. Heckler, supra, 584 F. Supp. at 503.
Although Supreme Court precedent may be unclear as to whether the sixty day requirement is a non-waivable jurisdictional one, compare Mathews v. Eldridge, supra, 424 U.S. at 328 n.9 (sixty day requirement is a statute of limitations waivable by the parties); Weinberger v. Salfi, supra 422 U.S. at 763-64 (same); and Heckler v. Lopez, supra, 104 S. Ct. at 226 (Brennan and Marshall, JJ., dissenting) ("I am far from convinced that the injunction issued by the District Court was jurisdictionally barred.") with Heckler v. Lopez, supra, 104 S. Ct. at 223 (Stevens and Blackmun, JJ., dissenting) (district court had no jurisdiction under § 405(g) over class members who received final decision more than sixty days prior to filing of class action); see also City of New York v. Heckler, supra, 742 F.2d at 737 (Supreme Court's position on issue "is not free from doubt"), the Second Circuit has recently held that this requirement is a waivable statute of limitations. City of New York v. Heckler, supra, 720 F.2d at 973 n.19 (Sixty day requirement is waivable by the Secretary); Johnson v. Heckler, 604 F. Supp. 1070, 1073-74 (N.D.Ill. 1985). But see Hyatt v. Heckler, 757 F.2d 1455, 1460-61 (4th Cir. 1985) (sixty day requirement is jurisdictional); Whipp v. Weinberger, 505 F.2d 800, 801 (6th Cir. 1974) (same). In City of New York v. Heckler, the Second Circuit ruled that the sixty day period should be considered tolled for the period during which the SSA's policy of applying a challenged presumption concerning residual functional capacity was operative but undisclosed. The Court held as follows:
All of the class members who permitted their administrative or judicial remedies to expire were entitled to believe that their Government's determination of ineligibility was the considered judgment of an agency faithfully executing the laws of the United States. Though they knew of the denial or loss of benefits, they did not and could not know that those adverse decisions had been made on the basis of a systematic procedural irregularity that rendered them subject to court challenge. Where the Government's secretive conduct prevents plaintiffs from knowing of a violation of rights, statutes of limitations have been tolled until such time as plaintiffs had a reasonable opportunity to learn the facts concerning the cause of action... Since in this case the full extent of the Government's clandestine policy was uncovered only in the course of this litigation, all class members may pursue this action notwithstanding the 60-day requirement.
Id. at 738 (citations and footnotes omitted). A number of other courts have also held that the sixty day limitations period should be tolled. See State of New York v. Heckler, supra, 105 F.R.D. at 123-24; Schisler v. Heckler, supra, slip op. at 9-13; W.C. v. Heckler, C83-865R, slip op. at 10-12 (W.D.Wash. July 11, 1985) (Magistrate's Report and Recommendation).
Application of these principles to the policies challenged in this case yields the conclusion that the sixty day period should be tolled. With respect to the non-acquiescence policy, plaintiffs had little basis to know, or reason to suspect, that the Secretary was refusing to apply the relevant precedents of judicial authorities in resolving their claims. Defendants note that the Secretary's policy was published in the Office of Hearings and Appeals ("OHA") Handbook used by ALJs in deciding disability cases, and that the Handbook is available for public inspection. See Mason Aff. [P][P] 4-5. As a matter of availability and claimant awareness, however, we find it difficult to distinguish the internal SSA memorandum which contained the challenged policy in City of New York v. Heckler, and the OHA Handbook at issue here. See Schisler v. Heckler, supra, slip op. at 12 (use of non-acquiescent disability termination standard which appeared in Disability Insurance State Mutual provided to states and available to public was sufficiently secretive to toll sixty day limitations period). The non-acquiescence policy was not published in the United States Code or the Code of Federal Regulations. Unlike other non-acquiescence cases, see, e.g., Lopez v. Heckler, supra. 713 F.2d at 1434, the SSA in this case issued no SSR which expressed the Secretary's nonacquiescence in Second Circuit precedents dealing with treating physicians, pain or the ALJ's duty to develop the record in pro se claimant cases. There is no indication that either the ALJs who decided plaintiffs' cases or the Appeals Council which reviewed them expressly stated their disagreement with Second Circuit precedent on these issues. The only manner in which the policy could have been detected is by a careful comparison of the Secretary's rules and the relevant case law; but surely the claimants "were entitled to believe that their Government's determination of ineligibility was the considered judgment of an agency faithfully executing the laws of the United States," City of New York v. Heckler, supra, 742 F.2d at 738, rather than the judgment of an agency which refused to adhere to Second Circuit precedent construing the Social Security Act. Where the allegation is that agency officials deliberately failed to apply federal appellate court precedents in rendering their determinations, the justification for tolling the sixty day period is substantial. We hold that insofar as nonacquiescence is concerned, the class need not be limited to those claimants who satisfied the sixty day requirement under § 405(g).
The circumstances surrounding the implementation of the Bellmon Review program also provide a a strong basis for tolling the sixty day limitations period. While defendants are correct in noting that the concept of own motion review expressly authorized by the Bellmon Amendment was not concealed or otherwise undisclosed, the particular manner in which defendants chose to implement this statutory mandate was considerably more circumspect. The statute itself made no reference to the particular emphasis which the Secretary placed on allowance decisions but spoke only of own motion review of "decisions" in general. A claimant interested enough in pursuing Senator Bellmon's remarks concerning high allowance ALJs would also have been aware of the deletion of the Senate's proposal for ALJ targeting, thus giving the claimant reason to believe that such a practice was not in effect. The SSR issued by defendants in January 1982 made reference to the need for particular emphasis on allowance decisions, but made no reference to the Secretary's policy of exclusively focusing on allowance decisions and placing primary reliance on ALJs with the highest allowance rates as the source of such decisions. No regulation was issued concerning the implementation of Bellmon Review; no publication of the program was made in the Federal Register or codified in the Code of Federal Regulations. A memorandum, written by defendant Louis B. Hays in September 1982, described the individual ALJ portion of Bellmon Review but was apparently restricted in its circulation to agency ALJs. See Ex. H,
at 204. A lawsuit filed in 1983 by the Association of ALJs challenging the legality of Bellmon Review, did not produce written decision until September 1984, three months after the sixty day limitation cutoff point in this case. See Association of Administrative Law Judges, Inc. v. Heckler, 594 F. Supp. 1132 (D.D.C. 1984) "AALJ v. Heckler "), motion for new trial denied, No. 83-0124, Order (D.D.C. June 29, 1985) (annexed to Defendants' Memo on Recent Developments). This decision thus could not have constituted notice of the particulars of Bellmon Review to class members whose administrative appeals concluded prior to May 30, 1984. The primary evidence, then, of the manner in which the Secretary implemented Bellmon Review was contained in congressional reports -- a January 1982 report written by the Secretary and submitted to Congress as required by statute,
and a October 1983 Senate Subcommittee report concerning Bellmon Review and non-acquiescence.
While we do not understand plaintiffs to argue that mere lack of knowledge of one's legal rights is sufficient grounds for waiving the sixty day limit, there are at least some indications that such lack of awareness was not purely accidental in this case. Defendants knew well before October 1981 that individual ALJ review was controversial and raised serious legal questions. Yet no effort was made either to subject the program to APA provisions concerning publication, hearings, notice and comment or other form of public disclosure. ALJs were informed in September 1982 about the nature and scope of the Bellmon Review program during its first year of operation. Their reaction was emphatically negative, prompting the institution of a lawsuit less than four months later. And while defendants complied with their statutory reporting requirement, at least one court has concluded that the Secretary's failure to publish the Bellmon Review program in the Federal Register or subject the program to statutory notice and comment requirements constituted a violation of the APA's rulemaking provisions. See W.C. v. Heckler, supra. The Magistrate in that case found that the Secretary's failure to publish the details of the Bellmon Review program "may be viewed as an attempt to shield" the program from "public scrutiny," id. at 25, and that the sixty day limitation period should be tolled for claimants challenging the validity of the program. Cf. State of New York v. Heckler, supra, 105 F.R.D. at 124 (failure to publish and proved to have been required," provides basis for tolling sixty day period). Finally, it is unclear at this stage of the proceedings whether, as a practical matter, the Secretary's report to Congress was accessible in such a manner that one could reasonably expect class members to have familiarized themselves with the program or even to have had an opportunity to do so. These circumstances, if proved, would support a conclusion that the sixty day limitations period should be tolled. Accordingly, jurisdiction over the proposed class is appropriate notwithstanding the sixty day rule.
Defendants also point out that the controversy surrounding Bellman Review was "bruited in the nightly news" by virtue of an attorney's criticism of Bellmon Review on the February 14, 1983 segment of the McNeil-Lehrer Report, and that defendants disclosed information concerning the Bellmon Review program in response to Freedom of Information Act ("FOIA") requests. See Defendants' Objections to Report, at 42; Ex. 3-17 to Mason Aff. We are not persuaded that the former type of public disclosure, by an individual unaffiliated with the SSA to an obviously limited audience, constitutes either notice to class members or disclosure by the defendants of the Bellmon Review policy. As for the FOIA responses, we note that not all of the responses disclose the use of individual ALJ "targeting" as one of the means by which the Bellmon Amendment was implemented; of those that do, all but two were issued in or after September 1983. As with the SSA's submission of its Report to Congress, we do not believe that the SSA's performance of these statutory obligations obviates the difficulties noted earlier.
It is undisputed that the Secretary's particular interpretation and implementation of the Bellmon Amendment was not disclosed in the statute, a regulation, an SSR, an operating annual or a handbook. There is even some question as to whether the SSA's implementation of Bellmon Review failed to conform to the rulemaking requirements of the APA. We need not and do not decide whether the Bellmon Review policy was promulgated in violation of the APA's rulemaking provisions, thus invalidating cases in which decisions rendered by ALJs were subject to own motion review and reversal by the Appeals Council. Cf. W.C. v. Heckler, supra, slip op. at 27. We only find that the consequence of the SSA's failure to disclose its implementation of Bellmon Review in accordance with these procedures or in some other manner reasonably ascertainable by claimants is that such claimants should not be precluded from even presenting their constitutional and statutory challenge to Bellmon Review to the federal courts solely by virtue of their failure to do so within sixty days of their denials. It would be an unduly stringent interpretation of the congressional intent underlying § 405(g)'s sixty day limitation to foreclose claimants from asserting a legal challenge to an agency policy which is in seeming conflict with the legislative intent underlying the authorizing statute itself, which raises colorable constitutional concerns, and where the specific methods used to implement the statute were disclosed in a less than obvious manner.
B. Mandamus Jurisdiction: Section 1361
Plaintiffs also assert that jurisdiction is proper under the mandamus statute, 28 U.S.C. § 1361. The significance of the availability of mandamus jurisdiction in this case is that the presentment and sixty day requirements of § 405(g) need not be satisfied where jurisdiction is predicated on § 1361. See City of New York v. Heckler, supra, 742 F.2d at 739 n.7. In light of the uncertain state of the law concerning the sixty day requirement and the preliminary stage of these proceedings, we believe it appropriate to consider whether mandamus proceedings, we believe it appropriate to consider whether mandamus jurisdiction is available so as to properly include within the class those claimants whose final decisions were rendered between October 1, 1981 and May 30, 1984 (the cut-off date under § 405(g)).
The mandamus statute, 28 U.S.C. § 1361, provides that
The district courts shall have original jurisdiction of any action in the nature of mandamus to compel an officer or employee of the United States or any agency thereof to perform a duty owed to the plaintiffs.
The availability of mandamus jurisdiction in Social Security cases in complicated by § 405(h), which provides in pertinent part that "No action against the United States, the Secretary, or any officer or employee thereof shall be brought under section 1331 or 1346 of Title 28 to recover on any claim arising under this subchapter."
The Supreme Court has repeatedly declined to resolve the question whether mandamus jurisdiction is available in cases involving claims arising under the Social Security Act notwithstanding the jurisdictional limitations expressed in § 405(h). See Heckler v. Ringer, supra, 104 S. Ct. at 2022; Califano v. Yamasaki, 442 U.S. 682, 698, 61 L. Ed. 2d 176, 99 S. Ct. 2545 (1979) (jurisdiction otherwise available under § 405(g)); Norton v. Mathews, 427 U.S. 524, 529-31, 49 L. Ed. 2d 672, 96 S. Ct. 2771 (1976) (merits of mandamus claim clearly insubstantial); Mathews v. Eldridge, supra, 424 U.S. at 332 n.12 (jurisdiction otherwise available under § 405(g)). A number of circuit and district courts, including the Second Circuit, have held that mandamus jurisdiction is available under circumstances where the writ would otherwise be available. See Ganem v. Heckler, 241 U.S. App. D.C. 111, 746 F.2d 844, 850 (D.C.Cir. 1984); City of New York v. Heckler, supra, 742 F.2d at 739 (CA2) (and Second Circuit cases cited therein); Mental Health Association of Minnesota v. Heckler, supra, 720 F.2d at 968-69 (CA8); Kuehner v. Schweiker, 717 F.2d 813, 819 (3d Cir. 1983), vacated and remanded on other grounds, 469 U.S. 977, 105 S. Ct. 376, 83 L. Ed. 2d 312 (1984); Leschniok v. Heckler, 713 F.2d 520, 522 (9th Cir. 1983); Martinez v. Richardson, 472 F.2d 1121, 1125-26 (10th Cir. 1973); Dixon v. Quern, 537 F. Supp. 990, 991-92 (N.D.Ill. 1982); McMahon v. Califano, 476 F. Supp. 978, 983-84 (D.Mass. 1979). The Second Circuit's precedent on this point is substantial, see Dietsch v. Schweiker, 700 F.2d 865, 867-68 (2d Cir. 1983); Ellis v. Blum, 643 F.2d 68, 78-82 (2d Cir. 1981); Barnett v. Califano, 580 F.2d 28, 31 (2d Cir. 1978); White v. Mathews, 559 F.2d 852, 856 (2d Cir. 1977), cert. denied, 435 U.S. 908, 98 S. Ct. 1458, 55 L. Ed. 2d 500 (1978), and the reasoning underlying these decisions has been thoroughly examined and persuasively established. See Ellis v. Blum, supra (Friendly, J.).
Given the principle that mandamus jurisdiction is available notwithstanding § 405(h), we need to determine whether the assertion of mandamus jurisdiction is appropriate in this case. A writ of mandamus will not issue unless (1) the plaintiffs have all right to have the act performed, (2) the defendant is under a clear nondiscretionary duty to perform the act requested, and (3) plaintiff has exhausted all other avenues of relief. See Heckler v. Ringer, supra, 104 S. Ct. at 2022; City of New York v. Heckler, supra, 742 F.2d at 739. While the assertion of mandamus jurisdiction is not to be perfunctorily made, many courts have found that mandamus jurisdiction will lie where a constitutional challenge to a generally applicable Social Security policy or procedure is raised. See City of New York v. Heckler, supra, 742 F.2d at 739 (mandamus jurisdiction exists to require Secretary to make eligibility determinations for claimants with mental impairments based on individualized determinations of residual functional capacity, as required by statute, rather than challenged presumption); Mental Health Association of Minnesota v. Heckler, supra, 720 F.2d at 971-72 n.17 (same) ("Thus the claim raised its procedural in nature and order would not infringe the Secretary's duly delegated authority to make the eligibility determinations."); Kuehner v. Schweiker, supra, 717 F.2d at 819 (suit challenging standards used in Secretary's "high volume review" process for termination of disability benefits); Ellis v. Blum, supra, 648 F.2d at 68-71 (challenging adequacy of pretermination notices to Social Security recipients); Elliott v. Weinberger, 564 F.2d 1219, 1225-27 (9th Cir. 1977) (challenge to Secretary's failure to provide hearing prior to termination of disability benefits in transition from state to federal disability program). These courts have emphasized that the Secretary's duty to provide procedures which comply with constitutional requirements is not a discretionary one, but is an unambiguous duty with compliance is mandated. See Ellis v. Blum, supra, 643 F.2d at 78; Elliott v. Weinberger, supra, 564 F.2d at 1226 (question of whether Secretary must provide pre-recoupment hearing "is a strict fifth amendment issue, and the question of discretion does not arise. The Secretary has either met his constitutional duty to provide a certain minimum, or he has not. He has no discretion to provide less than that constitutionally required."). Courts have also noted that the exercise of mandamus jurisdiction in these circumstances is appropriate since the relief sought is compliance with constitutional or statutory requirements governing the disability determination rather than the issuance of a particular substantive outcome with respect to such a determination. See Mental Health Association of Minnesota v. Heckler, supra, 720 F.2d at 971-72 n.17 ("A writ of mandamus would not rule on the outcome of the factual determination, but merely would compel the same to be made lawfully"); Ellis v. Blum, supra, 643 F.2d at 82 (mandamus jurisdiction exists where plaintiff raises "procedural challenge, the adjudication of which will not affect the substantive question of continued entitlement to disability payments", rather than "run-of-mine type" claim to recover benefits); cf. Heckler v. Ringer, supra, 104 S. Ct. at 2021, 2023 (Secretary's decision whether particular medical service is "reasonable and necessary" and whether such decision should be promulgated by rule or adjudication "are clearly discretionary decisions"; since relief sought included declaration that expenses incurred by claimant for surgical procedure were reimbursable under Medicare Act, claim was "at bottom, a claim that [plaintiffs] should be paid for their BCBR surgery").
Judged under these standards, plaintiffs' claim that the Bellmon Review program deprived them of their right to a full and fair hearing by an impartial hearing examiner is well within the class of claims for which mandamus jurisdiction is appropriate. Plaintiffs contend that the Bellmon Review program has deprived them of their right to a determination by an impartial and unbiased hearing examiner. This claim relates to the overall fairness of the agency fact-finding process and not to the substantive standards used by agency officials in rendering disability determinations. The issue confronting this Court is not whether the Secretary may or may not decide to conform ALJ hearings to constitutional or statutory standards of fairness and impartiality; it is whether the Secretary has in fact provided claimants with hearings which conform to these legal requirements. The underlying merits of each claimant's disability claim is irrelevant for these purposes, and the exercise of mandamus jurisdiction will thus not be tantamount to an award of benefits. Cf. Heckler v. Ringer, supra. This is also not a challenge to an isolated instance in which an ALJ's failure to adhere to agency procedures resulted in an unfair hearing and was promptly remedies by the Appeals Council by providing a new hearing. See Mercer v. Birchman, 700 F.2d 828 (2d Cir. 1983). Rather, it is a case in which the Secretary's own policy and practice has allegedly resulted in unfair hearings for all claimants and can be remedied only by providing redeterminations subsequent to the Secretary's revocation of an agencywide policy. While redeterminations before impartial ALJs may well increase claimants' chances for recovery of benefits, this Court, in exercising mandamus jurisdiction, will not be concerned with whether the Secretary has adhered to requirements of procedural fairness in rendering disability determinations pursuant to hearing before ALJs who were operating under the Bellmon Review program.
For similar reasons, mandamus jurisdiction is also appropriate with respect to the Secretary's non-acquiescence policy. Many courts have held in similar contexts that jurisdiction under § 1361 is appropriate. See City of New York v. Heckler, supra, 742 F.2d at 739 (failure to perform statutorily-required individualized assessment of residual functional capacity); Schisler v. Heckler, supra, slip op. at 13 (failure to apply medical improvement standard in termination cases); Holden v. Heckler, supra, 584 F. Supp. at 484 (failure to apply Sixth Circuit's medical improvement standard in termination cases); Rivera v. Heckler, 568 F. Supp. 235, 242-43 (D.N.J. 1983) (non-acquiescence in Third Circuit decisions concerning weight given to opinion of treating physician and subjective complaints of pain); Aldrich v. Schweiker, supra, 555 F. Supp. at 1089 (state agency's failure to apply Second Circuit decisions concerning weight given to treating physician's opinion, another agency's disability determination, and claimants' subjective complaints). But see Hyatt v. Heckler, supra, 757 F.2d at 1461 (§ 405(g) provides adequate remedy for challenge to Secretary's non-acquiescence policy). As with their Bellmon Review claim, plaintiffs do not seek an award of benefits, but only a redetermination of their claims in accordance with this Circuit's precedents. Plaintiffs assert that the Secretary is constitutionally required to render determinations in accordance with relevant judicial required to render determinations in accordance with relevant judicial precedent and that they have a right to determinations made in this manner. While application of these requirements may eventually lead to awards of benefits, it will not be this Court's function to award this type of merits-based relief to class members; this Court will determine only whether claimants are entitled to the redetermination they seek. In this respect, if plaintiffs ultimately prevail in this action, the Court would require only that certain guidelines be followed in rendering disability determinations rather than that certain results be reached.
The exercise of mandamus jurisdiction also requires a determination that other avenues of relief have been exhausted. We note that a number of courts have held that the analysis of the circumstances under which exhaustion under §§ 405(g) and 1361 should be waived are similar, and that claimants need not pursue administrative review procedures prior to raising their claims in federal court pursuant to § 1361 if exhaustion under § 405(g) is not required. See City of New York v. Heckler, supra, 742 F.2d at 739 n.7; Ellis v. Blum, supra, 643 F.2d at at 78-79; Mental Health Association of Minnesota v. Heckler, supra, 720 F.2d at 971 n.16; Kuehner v. Schweiker, supra, 717 F.2d at 827 (Becker, J., concurring). All class members herein have exhausted or will exhaust their administrative remedies prior to seeking judicial resolution of their claims. It is readily apparent that little purpose would be served by requiring claimants to again raise their claims to an agency which continues to adhere to policies which plaintiffs contend are unlawful. The potential harm to claimants from further administrative proceedings and the likely futility of further exhaustion clearly outweigh any benefit in requiring claimants to reassert their entitlement to benefits. Even if individual claimants were to succeed in obtaining an award of benefits, the policies of which they complain would remain in place and continue to affect other similarly situated claimants. If jurisdiction under § 405(g) is limited by the sixty day rule, some claimants will be precluded altogether from raising their constitutional and statutory challenges to the Secretary's policies in federal court.
In these circumstances, we find that claimants have no adequate alternative available to them for resolution of their claims.
According, this Court has mandamus jurisdiction under § 1361 over plaintiffs' claims.
C. Standing of City of New York
The City of New York, as a named plaintiff suing in its own behalf, has asserted claims against the defendants concerning the Secretary's non-acquiescence and Bellmon Review policies. Defendants contend that the City of New York lacks standing to raise these claims.
The Constitution requires at a minimum that a plaintiff have a "person stake" in the outcome of a controversy. A plaintiff must show that it has suffered some actual or threatened injury, that such injury can be traced to the challenged action of the defendant, and that the injury is likely to be redressed by a favorable decision. See Valley Forge Christian College v. Americans United for Separation of Church and State, Inc., 454 U.S. 464, 472, 70 L. Ed. 2d 700, 102 S. Ct. 752 (1982). In addition, a court must consider whether prudential considerations weigh against permitting a party to challenge the conduct at issue. A plaintiff must show that it asserts its own legal rights and not those of third parties, that its injury is not simply a "generalized grievance" which is shared by a large class of citizens, and that the plaintiff's interest falls within the "zone of interests" arguably protected or regulated by the law in question. See id. at 474-75.
The question of whether a governmental entity has standing to maintain an action such as this one in its own behalf has provoked conflicting responses.
Compare State of New York v. Heckler, 719 F.2d 1191, 1195 (2d Cir. 1983) (New York State has standing to challenge Secretary's contraceptive notification regulation); City of New York v. Heckler, 578 F. Supp. 1109, 1119-22 (E.D.N.Y.) (City of New York has standing in its own behalf to challenge Secretary's procedures for determining residual functional capacity of disability claimants with mental impairments), aff'd on other grounds, 742 F.2d 729 (2d Cir. 1984) (expressly reserving the issue), and Dixon v. Heckler, supra, 589 F. Supp. at 1516 & n.7 (New York State has standing as plaintiff-intervenor to challenge Secretary's severity regulation) with Hyatt v. Heckler, supra, 757 F.2d at 1462 (North Carolina Department of Human Resources lacks standing to sue in its own behalf to challenge Secretary's non-acquiescence policy; only beneficiaries may sue under § 405(g)) and Doe v. Heckler, 568 F. Supp. 681, 683 (D.Md. (1983) (State of Maryland and its officials lack standing to sue in their own behalf to challenge Secretary's policy for termination of disability benefits). In this case, the City bases its standing on its role in providing public assistance benefits and other social services to individuals who have been improperly denied or terminated from disability benefits by reason of the defendants' non-acquiescence and Bellmon Review policies. See First Amended Complaint [P] 6; McCorry Aff. [P][P] 82,83,86. If in fact the challenged policies have resulted in the improper denial or termination of disability benefits and thereby relegated these claimants to state public assistance programs funded in part by city tax revenues, the City has indeed suffered its own economic "injury in fact" which likely will be redressed by a favorable decision in this case. Such a decision, if rendered, will result in the rendering of disability determinations pursuant to redetermination by impartial ALJs in accordance with federal circuit court precedent and thus will likely result in the granting or restoration of disability benefits to at least some Social Security claimants. In addition, given the partial purpose underlying the Social Security disability and SSI programs to relieve state and local governments from the burden of providing for the disabled, and the unique and legitimate interest of such localities in insuring the appropriate and lawful administration of such programs, see City of New York v. Heckler, supra, 578 F. Supp. at 1121-22, we do not find (and defendants do not identify) any prudential considerations which should cause this Court to deny standing to the City. While claimants themselves have asserted their rights in this action to lawful disability determinations, the City also has a strong interest in obtaining relief for the Secretary's alleged unlawful ALJ review and non-acquiescence policies.
The decision of the Fourth Circuit in Hyatt does not compel a contrary conclusion. First, the purported standing of the state agency in Hyatt was based not on economic injury resulting from the Secretary's policies but on its role in administering the Social Security disability program at the initial state agency level. Second, while Hyatt correctly observed that only "individual" beneficiaries may seek judicial review of a final decision of the Secretary under § 405(g), this does not necessarily preclude the City from asserting its constitutional and other statutory challenges to the defendants' policies pursuant to this Court's general federal question or mandamus jurisdiction.
Finally, D'Amico v. Schweiker, 698 F.2d 903 (7th Cir. 1983), upon which Hyatt relies, is distinguishable. In D'Amico, the court held that administrative law judges lacked standing to challenge an instruction by the SSA that ALJs send certain notices to Social Security claimants who were terminated from disability benefits, which notice allegedly had as its objective the discouragement of claimant-initiated challenges to such terminations. The court's holding, however, was based on "the danger to judicial impartiality that is created by allowing judicial officers to sue the government because they think they are being asked to enforce unlawful policies." 698 F.2d at 906. Here, not only is there an absence of similar considerations favoring judicial restraint, but, ironically, the Bellmon Review policy which the City seeks to invalidate is alleged to have caused the very evil of judicial bias or lack of impartiality (albeit of a different character) which D'Amico sought to avoid.
Accordingly, we conclude that the City of New York has standing to challenge the Secretary's non-acquiescence and Bellmon Review policies.
VI. PRELIMINARY INJUNCTION
In order to be accorded preliminary injunctive relief in this Circuit, a party must typically demonstrate "(a) irreparable harm and (b) either (1) likelihood of success on the merits or (2) sufficiently serious questions going to the merits to make them a fair ground for litigation and a balance of hardships tipping decidedly toward the party requesting the preliminary relief." Jack Kahn Music Co. v. Baldwin Piano & Organ Co., 604 F.2d 755, 758 (2d Cir. 1979); Jackson Dairy, Inc. v. H.P. Hood & Sons, Inc., 596 F.2d 70, 72 (2d Cir. 1979). "A movant seeking to avail himself of the first alternative need not show that success is an absolute certainty. He need only make a showing that the probability of his prevailing is better than fifty percent. There may remain considerable room for doubt." Abdul Wali v. Coughlin, 754 F.2d 1015, 1025 (2d Cir. 1985). As the Magistrate recognized, an additional factor that should be considered in determining whether to grant a preliminary injunction in a case such as this one is whether the relief requested will adversely affect the public interest. See Mental Health Association of Minnesota v. Heckler, 720 F.2d 965, 972 (8th Cir. 1983); Lopez v. Heckler, 713 F.2d 1432, 1435 (9th Cir. 1983). The burden is on the party seeking the preliminary injunction to establish its entitlement to such relief. See Standard & Poor's Corp. v. Commodity Exchange, Inc., 683 F.2d 704, 707 (2d Cir. 1982).
Defendants contend that the more rigorous standard of "substantial likelihood of success on the merits" applied in Wali should be applied in this case. See Defendants' Objections to Report, at 6-7. We do not agree. In Wali, the court emphasized that such a standard should be applied where the grant of preliminary injunctive relief "may serve to provide all the relief that is sought on the merits." Abdul Wali v. Coughlin, supra, 754 F.2d at 1026. In Wali, such standard was applied since the suit involved a claim by prisoners that prison officials unlawfully interfered with their receipt of a report concerning conditions at the Attica Correctional Facility, and the injunctive relief requested was an order prohibiting such officials from interfering with the receipt of the report. That is far from the case at hand. By virtue of this Court's grant of preliminary injunctive relief, plaintiffs have not been awarded agency redeterminations for the many claimants whose claims were decided by the SSA from October 1, 1981 to the present. In addition, plaintiffs have not been granted an injunction prohibiting defendants from continuing their Bellmon Review program. Even with respect to prospective relief for the Secretary's modified non-acquiescence policy, our order of preliminary injunctive relief expressly reserves the defendants' right to recover any benefits paid to claimants as an indirect consequence of this Court's order in the event that defendants ultimately prevail on the merits of this action. Finally, the scope of the relief granted here is considerably more circumscribed than is often the case in proceedings such as this one, where class-wide interim benefits and notice requirements are not infrequently ordered. See page 169 infra. The preliminary injunction standard we use is consistent with the standard employed by other courts in Social Security disabled class action cases. See, e.g., Mental Health Association of Minnesota v. Heckler, supra, 720 F.2d at 972; Dixon v. Heckler, 589 F. Supp. 1494, 1501 (S.D.N.Y. 1984); Schisler v. Heckler, supra, 574 F. Supp. 1538, 1546 (W.D.N.Y. 1983); see also Lopez v. Heckler, 713 F.2d 1432, 1435 (9th Cir. 1983); cf. Holden v. Heckler, 584 F. Supp. 463, 490 (N.D.Ohio 1984) (plaintiff must generally show strong or substantial likelihood or probability of success on the merits). We conclude that plaintiffs' motion for preliminary injunctive relief should be evaluated in accordance with the likelihood of success standard.
In order to properly analyze plaintiffs' request for preliminary injunctive relief, it must be understood that the proposed class essentially consists of two groups of claimants: those who have already presented their claim for benefits to all levels of the agency, and those who have yet to do so. With respect to the former "retrospective" group, plaintiffs request, for immediate relief with respect to both Bellmon Review and non-acquiescence, an order directing defendants to identify such claimants, to provide a summary of the basis for the Secretary's unfavorable determination of their claims and other information pertaining thereto, and to provide the docket number and court of any pending cases involving these claimants. See Ex. NN (proposed order of relief), at 3. We view this request as being more in the nature of a request for discovery made subsequent to the denial of a motion to dismiss, as has occurred herein. We assume that such discovery shall take place expeditiously subsequent to the filing of this decision and that such discovery shall include all information which is necessary and relevant to the complete identification of the claims of class members and the administrative and judicial proceedings in which such class members have been involved. No further order of this Court is necessary at this time.
Plaintiffs also request that defendants notify claimants who have received an unfavorable decision from any ALJ and whose claims are currently pending in the administrative or judicial review process that they may raise the issue of non-acquiescence and Bellmon Review in their pending appeals. Id. at 3-4. We hereby instruct the Secretary to deem claimants currently in the administrative review process to have raised such objections, thus obviating the need for individualized notice to claimants at this early stage of the proceedings concerning legal challenges of which the Secretary is fully aware. With respect to claimants whose cases are pending before New York federal district courts, our previous discussion makes clear that these courts are well aware of this Circuit's treating physician rule and the Secretary's failure to adhere to this rule, and will take these factors into consideration to the extent they deem appropriate in deciding the cases pending before them.
In light of the above, and in the absence of any requests for further preliminary injunctive relief with respect to claimants who have already exhausted their administrative remedies, we conclude that such claimants will not be irreparably harmed if this Court does not order the retrospective relief which plaintiffs seek.
On the other hand, there is no question but that future class members will suffer considerable harm which will not be fully remedied by a retroactive award of benefits if injunctive relief is denied. Plaintiffs whose claims have yet to be resolved by the agency will be subject to erroneous deprivations of disability benefits if the policies they challenge are permitted to continue and are ultimately determined to be unlawful. Yet the withholding or erroneous termination of benefits in these circumstances is not an event of negligible monetary consequence. Whether or not "disabled" within the statutory meaning of the term, the class members in this case are physically and mentally impaired individuals who rely heavily on the receipt of disability benefits to provide for the bare necessities of life. All of the named plaintiffs, for example, rely on some form of public assistance and are barely, if ever, able to afford little more than rent, utilities, and transportation. Plaintiffs Stieberger and Happy have frequently been threatened with the loss of electricity because of their inability to pay their bills. Plaintiff Happy has had to borrow money from a friend in order to pay her rent. Plaintiffs Stieberger and Sullivan cannot even afford to buy their children new clothing. The loss or inability to obtain disability benefits is not simply an inconvenience for such claimants; it frequently involves a serious, detrimental impact on the individual's quality of life. And while these named plaintiffs are now receiving interim benefits by order of this Court, hundreds of similarly situated individuals will not be similarly provided for during the pendency of this action. Even if the Secretary goes beyond what is required under her own policy and acquiesces at the Appeal Council level in all Second Circuit decisions, claimants will nevertheless face considerable delays
while they attempt to press their claims through the lengthy administrative review process. There is also the considerable risk that some claimants will not succeed in reaping the ultimate benefits of the new non-acquiescence policy (see pages 103-09 infra), thus being not just temporarily delayed but completely deprived of disability benefits. Finally, we recognize that the harm suffered by virtue of arguably erroneous denials of benefits for many claimants is not only monetary; protracting the adjudicatory process by requiring claimants to pursue potentially futile procedures is frequently therapeutically detrimental to a claimant's mental and physical condition. As one court has stated, "the irreparable harm inherent in the pursuit of administrative relief ... [is] not alleviated but rather [is] exacerbated by the high reversal rate on appeal." Mental Health Association of Minnesota v. Heckler, supra, 720 F.2d at 970; Holden v. Heckler, supra, 584 F. Supp. at 463. Indeed, the denial of injunctive relief in this case may well subject class members to two rounds of administrative review: one which will occur during the pendency of this action if preliminary relief is denied, and another which will occur if plaintiffs ultimately prevail. The City, too, will incur additional burdens on already overextended public assistance programs and facilities if claimants are wrongfully denied federal disability benefits and thus are forced to rely on state and local assistance in order to subsist. In short, the showing of irreparable harm in this case is compelling. See Mental Health Association of Minnesota v. Schweiker, 554 F. Supp. 157, 166 (D.Minn. 1982), aff'd, 720 F.2d 965, 972 (8th Cir. 1983); Caswell v. Califano, 583 F.2d 9, 14 (1st Cir. 1978).
C. Likelihood of Success on the Merits
It is important at the outset to set forth the precise nature of the "non-acquiescence" with which we are concerned in this case. Defendants acknowledge that they are bound by the judgments or orders of federal courts in the specific cases in which they are issued. See Defendants' Memo on ALJs, at 3 n.3. Thus, this case does not involve the "law of the case" doctrine or principles of res judicata. At the other end of the legal spectrum, plaintiffs do not contend that the Secretary is legally obligated to follow a circuit court decision in a circuit other than the circuit in which the decision was rendered. Thus, plaintiffs do not argue that the decision of the first circuit court to decide an issue should have controlling, nationwide effect. What is at issue in this case is the Secretary's refusal to follow a circuit court ruling in subsequent cases within the same circuit.
Apart from defending the legality of the SSA's policy of intra-circuit non-acquiescence, defendants contend as an initial in Social Security disability cases and that the Secretary's challenged policies have been ratified by Congress as part of the 1984 amendments to the Social Security Act. Thus, defendants argue, this Court need not reach the issue of whether plaintiffs are likely to succeed in demonstrating that the Secretary's non-acquiescence policy is invalid. Defendants also argue, based on Hyatt v. Heckler, 757 F.2d 1455 (4th Cir. 1985), that preliminary injunctive relief is inappropriate under the circumstances of this case. We will address each of these arguments in turn.
a. Non-Acquiescence in Second Circuit Precedent
Preliminarily, we address defendants' contention that there is no need for this Court to evaluate the legality of its non-acquiescence policy because the Secretary's standards for evaluating the opinion of a claimant's treating physician are consistent with Second Circuit decisions on this issue.
Defendants contend that its rules concerning the weight to be given to the opinion of a treating physician are not inconsistent with the various ways in which the Second Circuit has articulated these legal standards. Implicit in their argument are two propositions: the Second Circuit's standards are less than consistent, and the Secretary's policy is consistent with the Second Circuit's. We reject both propositions.
The Second Circuit's rules on the opinion of a treating physician are a firmly embedded part of its Social Security jurisprudence. The Second Circuit has recently written:
It is well-established in this circuit that "[t]he expert opinions of a treating physician as to the existence of a disability are binding on the fact finder unless contradicted by substantial evidence to the contrary." Bastien v. Califano, 572 F.2d 908, 912 (2d Cir. 1978); see also Donato, 721 F.2d at 419 ("we have re- garded a treating physician's diagnosis, to the extent it is uncontradicted, as binding"); Rivera v. Schweiker, 717 F.2d at 723 ("expert opinion of a treating physician on the subject of disability is binding on the Secretary unless substantial evidence is presented to the contrary"); Eiden v. Secretary of Health, Education and Welfare, 616 F.2d 63, 64 (2d Cir. 1980) ("we have repeatedly stated that when 'no contradictory evidence is presented, a treating physician's expert opinion is binding on the Secretary'") (quoting Alvarado v. Califano, 605 F.2d 34, 35 (2d Cir. 1979) (per curiam)). Moreover, it is equally well-established that there is no requirement that the physician's "medical testimony 'be supported by "objecttive" clinical or laboratory findings.'" Eiden, 616 F.2d at 65 (quoting Cutler v. Weinberger, 516 F.2d at 1287).
Bluvband v. Heckler, 730 F.2d 886, 892-93 (2d Cir. 1984); see Carroll v. Secretary of Health and Human Services, 705 F.2d 638, 642 (2d Cir. 1983) ("The opinion of a treating physician is entitled to considerable weight ... and in the absence of contradictory evidence is binding on the Secretary") (citations omitted); Hankerson v. Harris, 636 F.2d 893 (2d Cir. 1980) ("It is settled law in this circuit that in the absence of substantial contradictory evidence, the opinion of the claimant's treating physician is binding on the Secretary.").
As the dates of the above decisions indicate, these rules are not novel or recent ones, but have origins which precede the October 1, 1981 date set forth in this Court's class definition. As early as 1972, the Second Circuit held that "[t]he expert opinions of [a claimant's] treating physicians as to [the claimant's] disability ... are binding upon the referee if not controverted by substantial evidence to the contrary." Gold v. Secretary of Health, Education and Welfare, 463 F.2d 38, 42 (2d Cir. 1972) (quoting Walker v. Gardner, 266 F. Supp. 998, 1002 (S.D.Ind. 1967)). And by 1980, the Second Circuit had similarly established the rule that such opinions need not be supported by objective clinical or laboratory findings. See Eiden v. Secretary of Health, Education and Welfare, supra.
The court in Bluvband not only stated the general rule concerning treating physicians but also articulated a detailed methodology, established by prior cases, for application of the rule:
The cited cases established a sequence, and in effect posit an analytical framework, which the ALJ should follow. Initially, the ALJ should see whether the treating physician has determined that the claimant is disabled. He should then examine the record for conflicting evidence. Upon finding conflicting evidence, he should compare the probative value of the treating physician's opinion with the probative value of the conflicting evidence. He should do so with the recognition that the treating physician's determination is generally "entitled to more weight than that of a doctor who has only seen the claimant once (E.D.N.Y. 1974).
Id. at 893. The court then indicated how the agency determination at issue had departed from this well-established rule. First, the court noted that the ALJ failed at the outset to accord the treating physician's opinion appropriate weight:
In contrast to the above sequence, the ALJ herein assumed, ab initio, that "the weight to be given to [Dr. Nash's] statement ... depends upon the extent to which it is supported by specific and complete clinical findings ...." App. 7. It was improper for the ALJ to disregard the above framework by requiring from the start that Dr. Nash's expert opinion be accompanied by concrete and detailed clinical support. Obviously, this does not mean that specific and concrete clinical findings supporting a treating physician's position would not be useful to the Secretary in evaluating such an opinion of disability in light of conflicting evidence.
Id. The court then found that apart from the failure to give the treating physician's opinion appropriate weight, the ALJ improperly rejected the opinion in the absence of substantial contradictory evidence. The court thus concluded that "Since Dr. Nash's opinion is not 'contradicted by substantial evidence to the contrary,' Bastien v. Califano, 572 F.2d at 912, his 'expert opinion ... on the subject of disability is binding on the Secretary....' Rivera v. Schweiker, 717 F.2d at 723." Id. at 895.
Defendants cite two other decisions -- Mongeur v. Heckler, 722, F.2d 1033 (2d Cir. 1983) and Aponte v. Secretary of Health and Human Services, 728 F.2d 588 (2d Cir. 1984) -- as evidence of the "variety of ways" in which the Second Circuit has articulated the treating physician rule. See Defendants' Objections to Report, at 50-52. Acknowledging the fact that the treating physician rule has been articulated in opinions written by no fewer than five circuit judges in the cases cited above and that slight linguistic variations will thus, inevitably occur, we find these two decisions entirely consistent with the standard articulated in Bluvband and the cases cited therein. In Mongeur, the court stated that "the opinion of a treating physician is not binding if it is contradicted by substantial evidence, ... and the report of a consultative physician may constitute such evidence[,]" 722 F.2d at 1039 (citations omitted), a negative articulation of the treating physician standard which is virtually identical to Bluvband. In Aponte, the court noted that "the opinions of a treating physician deserve special respect" but that "genuine conflicts in the medical evidence are for the Secretary to resolve." 728 F.2d at 591. The court cited Carroll, supra, and Parker v. Harris, 626 F.2d 225 (2d Cir. 1980), which essentially reiterates the standard enunciated in Bastien, supra.
In short, ten different decisions of the Second Circuit have established one consistent standard concerning the opinions of treating physicians in disability cases: absent substantial evidence to the contrary, such opinions are binding on the Secretary; these opinions need not be supported by objective clinical or laboratory findings in order to be accorded such weight.
The Secretary's rule on treating physicians is contained in Social Security Ruling ("SSR") 82-48c (Oct. 1982), which provides that other things being equal, the fact that a physician treated a claimant will increase the weight which his or her opinion is accorded. This standard is derived from the Fifth Circuit's statement in Oldham v. Schweiker, 660 F.2d 1078, 1084 (5th Cir. 1981), that "although the opinion of an examining physician is generally entitled to more weight than the opinion of a non-examining physician, the ALJ is free to reject the opinion of any physician when the evidence supports a contrary conclusion." In addition, the Secretary's regulations suggest that the opinion of a treating physician must be supported by clinical or laboratory findings in order to be considered as evidence of disability. See 20 C.F.R. §§ 404.1526(b), 416.926(b); see also Oldham v. Schweiker, supra, F.2d at 1084.
A comparison of the standards used by the Second Circuit and the SSA reveals a significant difference in the weight accorded to the opinion of a treating physician. Under the Secretary's standard, a treating physician's opinion is generally weightier than that of a non-treating physician. No mention is made, however, that such an opinion is itself binding on the Secretary absent substantial evidence of a contradictor nature. Plaintiffs also point to a number of SSRs which instruct ALJs to treat a state agency physician as a medical expert and to give "appropriate" or "probative" weight to the opinion of such a physician, without mentioning the relative weight to be given to a treating physician. See Plaintiffs' Response to Defendants' Memo on ALJs, at 17-18. Also, plaintiffs observe that the Secretary has also adopted a Seventh Circuit decision, Cummins v. Schweiker, 670 F.2d 81, 84 (7th Cir. 1982), which states that a treating physician who had greater knowledge of the claimant's medical condition and had examined him more extensively than anyone else "might have been leaning over backwards to support the application for disability benefits" and that his conclusion was therefore not entitled to controlling weight. SSR 83-6c (1983). The Secretary's standards also suggest that a treating physician's opinion may be rejected if unsupported by clinical or laboratory findings even in the absence of contradictory evidence. Read together, these various SSRs and the language of the Secretary's treating physician's opinion which understates the significance of such an opinion and which is not in accord with the views of the Second Circuit.
Defendants point to § 401.085 of the Disability Insurance Program Operations Manual System as evidence of the SSA's recognition that "treating physicians are 'unique' and 'invaluable' sources of medical information whose evidence should be sought '[w]herever possible.'" Defendants' Objections to Report, at 52. While this provision does describe the treating physician in somewhat more flattering terms than SSR 82-48c, this section nevertheless does not refer to the weight to be given to a treating physician's opinion by merely the importance of obtaining evidence of one. Defendants' argument that § 401.085 is evidence of acquiescence in Second Circuit treating physician precedents is therefore unpersuasive.
Any doubt that the standards applied by the Second Circuit and the Secretary are indeed different, and that defendants have not been applying the Second Circuit's standard, is put to rest by the Secretary's litigation record on this issue. The sheer volume of cases in this Circuit in which an administrative denial of benefits was overturned due to a failure to properly apply the Second Circuit's treating physician rule is strong evidence that the Secretary's policy on the weight to be given to treating physician opinions is not in accord with Second Circuit case law. While ALJ determinations in this area have been overturned with more than modest frequency in this Circuit for some time, see, e.g., Aubeuf v. Schweiker, 649 F.2d 107, 112 (2d Cir. 1981); Parker v. Harris, supra, 626 F.2d at 232-33; Singletary v. Secretary of Health, Education and Welfare, 623 F.2d 217, 219 (2d Cir. 1980); Eiden v. Secretary of Health, Education and Welfare, 616 F.2d 63, 64 (2d Cir. 1980) (treating physician rule "has been ignored in this case"); Alvarado v. Califano, 605 F.2d 34 (2d Cir. 1979); Bastien v. Califano, 572 F.2d 908, 912 (2d Cir. 1978), the pace of such reversals has increased markedly in recent years. See, e.g., Bluvband v. Heckler, supra, 730 F.2d at 892-93; Fiorello v. Heckler, 725 F.2d 174, 176 (2d Cir. 1983) (ALJ should not have "rejected summarily" the expert opinions of treating physicians); Donato v. Secretary of Health and Human Services, 721 F.2d 414 (2d Cir. 1983); Rivera v. Schweiker, 717 F.2d 719, 723-24 (2d Cir. 705 F.2d at 642-43. In the past two years alone, no fewer than 26 reported decisions have been issued by 18 different judges of the federal district courts of New York in which disability determination of the Secretary was overturned based upon its inconsistently with the Second Circuit's treating physician rule. See, e.g., Pagan v. Heckler, 605 F. Supp. 1237, 1240-41 (S.D.N.Y. 1985) (Carter,J.) (ALJ incorrectly concluded at the outset that treating physician's report was entitled to less weight than consultative physician's report based on lack of clinical findings); Carrillo v. Heckler, 599 F. Supp. 1164, 1169 (S.D.N.Y. 1984) (Kennan, J.) (insufficient evidence to rebut opinion of treating physician); Hughes v. Heckler, 598 F.Supp 765, 767 (W.D.N.Y. 1984) (Elfvin,J.) (Appeals Council improperly rejected unrebutted conclusions of treating physician); Frost v. Heckler, 596 F. Supp. 1132, 1138 (S.D.N.Y. 1984) (Cooper,J.) (ALJ gave insufficient weight to treating physicians' opinion); Masella v. Heckler, 592 F. Supp. 621, 624 (S.D.N.Y. 1984), (Elfvin,J.) (ALJ failed to properly evaluate treating physician's opinion as to claimant's residual capacity); Irvin v. Heckler, 592 F. Supp. 531, 540-41 (S.D.N.Y. 1984) (Ward,J.) (Secretary failed to give proper weight to unrefuted opinion of treating physician; Secretary's determination was "patently contrary to the well-settled principles governing disability benefits proceedings" and was "in direct contradiction with the overwhelming weight of precedent in the Second Circuit"); Sellers v. Heckler, 590 F. Supp. 1141, 1145-46 (S.D.N.Y. 1984) (Edelstein,J.) (Secretary incorrectly discounted treating physician's opinion based on alleged lack of objective clinical findings and testimony of non-examining physician); McGuire v. Heckler, 589 F. Supp. 718, 721-24 (S.D.N.Y. 1984) (Weinfeld,J.) (ALJ's decision "not rendered with due regard for the rules governing the considerations of expert medical opinions," including reliance on questionable observation regarding lack of supporting objective clinical findings "directly contrary to the repeated admonition by our Court of Appeals" regarding absence of such a requirement); LaFace v. Heckler, 589 F. Supp. 192, 196-196-197 (S.D.N.Y. 1984) (Sand,J.) (ALJ improperly rejected opinion of treating physician in absence of substantial contradictory evidence); O'Grady v. Heckler, 588 F. Supp. 850, 855 (E.D.N.Y. 1984) (Wexler,J.) (Secretary improperly rejected opinions of treating physicians in absence of substantial contradictory evidence); Mazzella v. Secretary of Health and Human Services, 588 F. Supp. 603, 606 (S.D.N.y. 1984) (Ward,J.) (Secretary improperly rejected uncontradicted opinion of treating physician); Walker v. Heckler, 588 F. Supp. 819, 822-24 (S.D.N.Y. 1984) (Weinfeld,J.) (ALJ improperly rejected treating physician's opinion based, inter alia, on fact that opinion was based on symptomatology rather than on clinical findings); Keppler v. Heckler, 587 F. Supp. 1319, 1322-23 (S.D.N.Y. 1984) (Ward,J.) (ALJ improperly rejected uncontroverted opinions of treating and examining physicians based on fact that opinions were based on symptoms rather than objective findings); Moruzzi v. Secretary of Health and Human Services, 587 F. Supp. 16, 18 (S.D.N.Y. 1984) (Sweet,J.) (ALJ
improperly rejected uncontradicted opinion of treating physician); Hernandez v. Heckler, 585 F. Supp. 338, 342 (S.D.N.Y. 1984) (Pollack,J.) (ALJ improperly disregarded opinions of consultative physicians and treating hospital); Scanlon v. Heckler, 584 F. Supp. 791, 796-98 (S.D.N.Y. 1984) (Kram,J.) (ALJ improperly discredited opinion of treating physician "based upon an apparent failure to apply proper legal principles"); Queenan v. Heckler, 581 F. Supp. 1216, 1219 (S.D.N.Y. 1984) (Owen,J.) (Appeals Council improperly rejected ALJ's recommendation where opinion of treating physician was uncontradicted); Barrett v. Secretary of Health, Education and Welfare, 581 F. Supp. 484, 489 (S.D.N.Y. 1984) (Sofaer,J.) (Appeals Council improperly remanded case to ALJ based on determination that ALJ, in favoring the report of treating physician, was stating a general rule that opinion of treating physician is necessarily more persuasive than that of consulting physician); Bayersdorfer v. Secretary of Health and Human Services, 578 F. Supp. 131 (S.D.N.Y. 1983) (Broderick,J.) (ALJ improperly rejected opinion of treating physician in absence of substantial contradictory evidence); Zayas v. Heckler, 577 F. Supp. 121, 126-27 (S.D.N.Y. 1983) (Duffy,J.) (Appeals Council improperly rejected opinion of treating physician); Brown v. Heckler, 576 F. Supp. 289, 292 (S.D.N.Y. 1983) (Carter,J.) (Appeals Council improperly rejected ALj's findings which were based, inter alia, on opinion of treating physician); Sherrer v. Secretary of Health and Human Services, 575 F. Supp. 1503, 1504 (S.D.N.Y. 1983) (Weinfeld,J.) (remanding case based in part upon
failure to explain why opinions of treating physicians were "virtually rejected out of hand ... the record is bare of any indication that the ALJ or the Appeals Council acknowledged the weight to be accorded opinions of treating physicians"); Tingling v. Secretary of Health and Human Services, 575 F. Supp. 905, 908-09 (S.D.N.Y. 1983) (Carter,J.) (ALJ improperly rejected opinion of treating physician based on opinion of non-examining doctor); Edwards v. Secretary of Health and Human Services, 572 F. Supp. 1235 (E.D.N.Y. 1983) (Weinstein,J.) (ALJ improperly rejected opinion of treating physicians in absence of substantial contradictory evidence and improperly required opinion to be supported by objective findings); Chrzan v. Heckler, 572 F. Supp. 844 (W.D.N.Y. 1983) (Telesca,J.) (Secretary improperly rejected opinions of treating and examining physicians); Newton v. Heckler, 568 F. Supp. 1044, 1046-47 (W.D.N.Y. 1983) (Telesca,J.) (ALJ improperly rejected opinions of treating physician which were consistent with those of two other examining physicians in favor of form completed by non-examining physician).
Most recently on the appellate level, in DeLeon v. Secretary of Health and Human Services, 734 F.2d 930 (2d Cir. 1984), the Second Circuit reversed an ALJ's denial of disability benefits based on th improper application of three legal standards: the failure to apply the medical improvement standard (a standard in which the Secretary had previously expressed her non-acquiescence; see pages 96-97 infra), the failure to consider the claimant's impairments in combination (a standard which was held unlawful in Dixon v. Heckler, 589 F. Supp. 1494 (S.D.N.Y. 1984)), and the failure to give proper weight to the treating physician's testimony. As for the last error, the Court observed that "[t]he cases in this circuit are almost legion where the court has reversed administrative findings due to the factfinder's failure to give appropriate weight to the expert opinion of the treating physician ... Once again, we find that the Secretary failed to give sufficient weight to the evidence of the treating mental health professionals and gave no justification for not doing so." Id. at 937-38 (citations omitted). The Court rejected the ALJ's determination and awarded attorney's fees to the claimant under the Equal Access to Justice Act. Id. at 938.
The evidence of agency non-acquiescence in the Second Circuit's treating physician rule is overwhelming. One or two decisions reversing the ALJ's improper consideration of treating physician opinion testimony might be nothing more than the ordinary aberrations of the administrative agency adjudicative process. The striking pattern of consistent disregard for clear, repeatedly articulated standards is evidence of a wholly different character. Moreover, while the present record is not complete with full administrative records of plaintiffs' individual disability determinations, defendants have made no attempt to even begin to refute the assertions of non-acquiescence contained in the affidavits of the individual plaintiffs, see Ex. C,D,E,F,G to Plaintiffs' Motion for a Preliminary Injunction; see also Kubitschek Aff. [P] 10-20, concerning the agency's blatant disregard of the Second Circuit's treating physician rule.
Defendants may well be correct in observing that cases involving the opinion of a treating physician involve a panoply of different factual circumstances including, inter alia, the nature of the physician's opinion (i.e., medical, vocational, or a "legal" opinion on the ultimate issue of disability); the length of the doctor/patient relationship; the physician's expertise in the subject matter of his or her opinion, or the consistency of a treating physician's opinion with that of another treating physician. We fail to see, however, how these variables in any way refute or explain the overwhelming evidence of the Secretary's persistent failure to apply the Second Circuit's legal standards governing the evaluation of the opinion of a claimant's treating physician. While the Secretary's non-acquiescence could arguably be even more explicit, such as in those situations in which the Secretary issues a formal statement of non-acquiescence, we believe that the preliminary showing here is virtually as strong a showing of de facto non-acquiescence as can be made.
We are mindful of the fact that the relationship between the judiciary and the executive branch's administrative agencies is normally one of respect and deference, and that this relationship goes to the essence of the administrative process and the intent of Congress in initially creating such agencies. The administrative agency is typically entrusted with the faithful execution of the laws, and deference is accorded to the agency's institutional expertise and judgment in implementing the letter and spirit of the laws. However, the sheer volume of decisions in which courts have overturned determinations of the SSA based on irreconcilability with this Circuit's treating physician rules has ...