The opinion of the court was delivered by: Skretny, District Judge.
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
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.
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
On February 17, 1991 plaintiff filed this lawsuit seeking
reversal or a remand of the Secretary's final decision.
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.
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
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 ...