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BARBER v. SULLIVAN

May 17, 1991

KENNETH BARBER, PLAINTIFF,
v.
LOUIS W. SULLIVAN, M.D., SECRETARY OF HEALTH AND HUMAN SERVICES, DEFENDANT.



The opinion of the court was delivered by: Skretny, District Judge.

DECISION AND ORDER

Now before this Court is the motion of defendant Louis W. Sullivan, M.D., the Secretary of Health and Human Services ("Secretary"), for a judgment on the pleadings pursuant to Fed.R.Civ.P. 12(c).

Plaintiff Kenneth Barber ("plaintiff") filed this lawsuit pursuant to § 205(g) of the Social Security Act, 42 U.S.C. § 405(g) ("Act"), seeking review of the Secretary's final decision terminating plaintiff's disability insurance benefits.

This Court has jurisdiction over this lawsuit pursuant to 42 U.S.C. § 405(g).

The Secretary moves for judgment on the pleadings, arguing that substantial evidence in the factual record supports his final determination. In support of his motion, the Secretary submits a legal memorandum ("S. memo.") and the transcript of the administrative record. ("R."). In opposition to the Secretary's motion, plaintiff submits a legal memorandum ("p. memo."). This Court has considered these submissions and has reviewed the entire record.

Conclusion: For the reasons set forth below, this Court holds that substantial evidence in the factual record supports the Secretary's final determination and, therefore, grants the Secretary's motion and dismisses plaintiff's lawsuit.

PROCEDURAL HISTORY

On August 18, 1978 plaintiff filed an application for social security disability benefits due to his deteriorating health caused by Multiple Sclerosis.

Subsequently, the Social Security Administration's ("Administration") Department of Health and Human Services ("Department") granted plaintiff's application for disability insurance benefits, finding plaintiff disabled within the Act since January 20, 1978, and awarded plaintiff, his wife and son benefits retroactive to July 1978. (R., p. 7).

Subsequently, in late 1986, after reviewing plaintiff's relevant tax returns and concluding that plaintiff's work and earnings were substantial and gainful within the Act, the Department determined plaintiff no longer disabled within the Act since January 1980.

Upon reconsideration, the Department's internal review process affirmed the decision that plaintiff's disability ceased due to plaintiff's substantial gainful activity.

On August 30, 1988, after a hearing held on June 3, 1988 (the "hearing"), at which plaintiff, represented by counsel, testified, an Administrative Law Judge ("ALJ"), after a de novo review of the record, denied plaintiff's appeal of the termination of his disability benefits. Affirming the Department's determination, the ALJ found plaintiff no longer disabled within the Act.

On January 9, 1989, the ALJ's decision became the final decision of the Secretary when the Administration's Appeals Council denied plaintiff's request for review of the ALJ's decision.

On February 17, 1991 plaintiff filed this lawsuit seeking reversal or a remand of the Secretary's final decision.

FACTS

Plaintiff is the sole owner of an insurance agency which he operates through his home. (R., p. 115). Plaintiff's business presently employs two additional people, plaintiff's wife, who does all the clerical work and works about twenty hours per week, and another employee who does much of the agency's underwriting. (R., pp. 116, 61-63).

Plaintiff testified that his insurance business works as follows: prospective business comes to his home via telephone and consequently applications are completed and sent to insurance carriers. The insurance carrier then bills the insured directly. (R., pp. 52, 56). Plaintiff testified that he does not solicit business but that it comes to him ". . . purely by word of mouth, from one client to another." (R., p. 51).

Plaintiff testified that he is not involved in the day-to-day activities of the insurance business, (R., pp. 50, 51, 59), and that he contributes about one hour per week to the business. (R., p. 53). Plaintiff also testified that his insurance business could not operate without his state insurance license (R., p. 54).

According to a June 27, 1986 Work Activity Report (the "Report") completed by plaintiff, since January 20, 1978, he averaged $500.00 monthly self-employment income and earned at least $75.00 per month. The Report states that plaintiff worked at his business approximately eight hours per month. (R., p. 115). According to the Report, plaintiff makes management decisions for the business, "determining [insurance] companies for coverage. . . ."

As noted above, on August 18, 1978 plaintiff applied for social security disability benefits and, shortly thereafter, the Administration awarded him benefits retroactive to July 1978.

In 1986, by virtue of certain tax returns, the Administration learned that plaintiff reported net earnings from self employment while at the same time receiving his disability benefits. These net earnings were $612.71 in 1978, $2,442.63 in 1979, $4,739.90 in 1980, $6,792.01 in 1981, $5,014.52 in 1982, $10,736.17 in 1983, $3,432.33 in 1984 and $20,400.14 in 1985. (R., pp. 94-112). Based on this newly acquired information, the Administration concluded that plaintiff engaged in substantial gainful activity within the Act as of January 1980 following plaintiff's completion of a ...


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