The opinion of the court was delivered by: Michael A. Telesca United States District Judge
Plaintiff Marcia A. Lynch brings this action pursuant to Title II of the Social Security Act seeking review of a final decision of the Commissioner of Social Security ("the Commissioner")which found that Plaintiff was not disabled within the meaning of the Social Security Act ("the Act"). Plaintiff alleges that the decision of the Appeals Council and the findings it incorporated from the decision of Administrative Law Judge ("ALJ") Timothy McGuan did not apply the correct legal standards and were not supported by substantial evidence in the record.
The Commissioner moves for judgment on the pleadings on the grounds that the decision of the Appeals Council was supported by substantial evidence in the record and was based upon the application of the correct legal standards. Plaintiff cross-moves for judgment on the pleadings and opposes the Commissioners's motion on the grounds that the Commissioner's decision was not supported by substantial evidence. For the reasons discussed below, the Court denies the Commissioner's motion for judgment on the pleadings, grants Plaintiff's cross-motion for judgment on the pleadings, and remands this claim to the Commissioner for further proceedings consistent with this decision.
Over thirteen years ago, on January 12, 1998, plaintiff filed an application for Social Security Disability benefits under Titles II and XVIII of the Social Security Act. (Tr. 248-50.) On March 23, 1998, the Social Security Administration initially denied her application. (Tr. 248-51.) Plaintiff applied for reconsideration, and her application was again denied on June 2, 1998. (Tr. 187-88.) Lynch then requested a hearing, which took place on July 27, before ALJ Eugene Bond.*fn1 On September 23, 1999, ALJ Bond issued an unfavorable decision (Tr. 153-63), and Plaintiff then requested a review of the decision. On June 20, 2002, the Appeals Council remanded the case for further proceedings. (Tr. 202-04.)
On December 19, 2002, a hearing took place before ALJ Timothy McGuan. (Tr. 74-106.) On June 26, 2003, ALJ McGuan issued a partially favorable decision, finding that Plaintiff was disabled from June 1, 1996 to June 2, 1998. (Tr. 205-20.) On August 12, 2003, Plaintiff appealed ALJ McGuan's decision to the Appeals Council. (Tr. 222.) On several occasions over the following years, Plaintiff's counsel requested a transcript of the hearing before ALJ McGuan, which she did not receive. (Tr. 221-25.)
On October 18, 2006, after three years of inaction by the Social Security Administration, the Appeals Council informed Plaintiff that the exhibit file for her case had been lost, and it remanded the case to ALJ McGuan for a supplemental hearing with respect to Plaintiff's disability status after June 2, 1998. (Tr. 226-28.)
One year later, on November 5, 2007, Plaintiff attended her third hearing (the second before ALJ McGuan). (Tr. 107-49.) On December 26, 2007, ALJ McGuan found that from June 2, 1998 to the date of that ruling, Plaintiff was not under a disability. (Tr. 52-62.) Plaintiff requested reversal of ALJ McGuan's decision from the Appeals Council. (Tr. 49-50.)
Over a year later, on May 13, 2009, the Appeals Council issued a final decision on behalf of the Commissioner and found that Plaintiff was entitled to disability benefits beginning June 1, 1996, but that Plaintiff's disability had ended June 2, 1998 and Plaintiff's eligibility for benefits had ended September 31, 1998. (Tr. 16-21.) On July 8, 2009, Plaintiff filed this action.
I. Jurisdiction and Scope of Review
Under 42 U.S.C § 405(g), the District Court has jurisdiction to review final decisions of the Commissioner denying Social Security benefits. Matthews v. Eldridge, 424 U.S. 319, 320, 96 S.Ct. 893, 47 L.Ed.2d 18 (1976). The Court reviews decisions of the Commissioner to determine whether its factual findings are supported by substantial evidence and whether the Commissioner applied the proper legal standards. Schaal v. Apfel, 134 F.3d 496, 501 (2d Cir. 1998). Review is not de novo. Id.
The Court must accept all factual findings made by the Commissioner that are supported by "substantial evidence." 42 U.S.C. § 405(g); Bubnis v. Apfel, 150 F.3d 177, 181 (2d Cir. 1998); Perez v. Chater, 77 F.3d 41, 46 (2d Cir. 1996). Substantial evidence is "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Metropolitan Stevedore Co. v. Rambo, 521 U.S. 121, 149, 117 S.Ct. 1953, 138 L.Ed.2d 327 (1997) (quoting Consolidated Edison Co. v. NLRB, 305 U.S. 197, 229, 59 S.Ct. 206, 93 L.Ed. 126 (1938)). When the Appeals Council modifies a ruling of the ALJ, "review by the district courts... is to be governed by the substantial evidence standard in terms of the Secretary's final decision as expressed by the final action of the Appeals Council." Mullen v. Bowen, 800 F.2d 535, 545 (6th Cir. 1986); see also, Bauzo v. Bowen, 803 F.2d 917, 921 (7th Cir. 1986); White v. Schweiker, 725 F.2d 91, 94 (10th Cir. 1984).
Both Plaintiff and Commissioner move for judgment on the pleadings under U.S.C. 405(g) and Rule 12(c) of the Federal Rules of Civil Procedure. Under Section 405(g), the Court "shall have power to enter, upon the pleadings and transcript of the record, a judgment affirming, modifying, or reversing the decision of the Commissioner of Social Security, with or without remanding the cause for a rehearing." 42 U.S.C. § 405(g). The District Court should remand for a calculation of disability benefits when persuasive evidence of disability exists and no purpose would be served by further evidentiary proceedings. Carroll v. Secretary of Health and Human Serv., 705 F.2d 638, 644 (2d Cir. 1981). When the record contains sufficient evidence for the court to enter a judgment and the case has experienced significant delay, it may be inappropriate to remand the case for further evidentiary proceedings. Curry v. Apfel, 209 F.3d 117 (2d Cir. 2000); Randall v. Sullivan, 956 F.2d 105.109 (5th Cir. 1992).
Rule 12(c) allows judgment on the pleadings when it is possible to rule on the merits from the contents of the pleadings alone and when there is no material dispute of fact. Sellers v. M.C. Floor Crafters, Inc., 842 F.2d 639 (2d Cir. 1988). When a complaint fails to state a valid basis for relief, judgment on the pleadings may be appropriate. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 558 (2007). Because this Court finds that (1) the decision of the Appeals Council was not supported by substantial evidence and (2) the record contains substantial evidence of Plaintiff's disability such that further evidentiary proceedings would serve no further purpose, judgment on the pleadings is hereby granted in favor of the Plaintiff.
II. Process of Disability Determinations
The Social Security Act defines disability as the "inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months. 42 U.S.C § 423(d)(1)(A). "Substantial gainful activity" is defined by regulation as "work that--(a) Involves doing significant and productive physical or mental duties; and (b) Is done (or intended) for pay or profit." 20 C.F.R. § 404.1510.
A worker will not be considered disabled if he can perform "substantial gainful work which exists in the national economy, regardless of whether such work exists in the immediate area in which he lives, or whether a specific job vacancy exists for him, or whether he would be hired if he applied for work." 42 USC § 423(d)(2)(A).
SSA regulations at 20 CFR § 404.1520(a)(4)(i)-(v) establish a five-step sequential process for evaluating disability claims:
(1) If the claimant is engaged in substantial gainful activity, then he is not disabled. If he is not, the evaluator proceeds to the next step.
(2) If the claimant does not have a severe medically determinable physical or mental impairment or combination of impairments, then he is not disabled. If he does, then the evaluator proceeds to the next step.
(3) If the claimant's impairment or combination of impairments meets or equals one of the impairments listed in 20 CFR Part 404, Appendix 1 to Subpart P, then he is disabled. Otherwise the evaluator proceeds to the next step.
(4) The evaluator determines the claimant's residual functional capacity. If the claimant's capacity allows him to perform his past relevant work, then he is not disabled. If it does not, then the evaluator proceeds to the next step.
(5) If the claimant has the capacity to engage in employment consistent with his vocational experience, then he is not disabled. If he does not, then he is disabled.
Once a claimant establishes disability via this process, the Commissioner bears the burden of showing that a medical improvement has ended the disability. Waters v. Barnhart, 276 F.3d 716, 719 (5th Cir. 2002), Griego v. Sullivan, 940 F.2d 942, 94, 946 (5th Cir. 1991). In particular, the Commissioner must determine that there is a medical improvement, and that the medical improvement is related to the claimant's ability to do work. 20 CFR § 404.1594(f)(3)-(4). Finally, the Commissioner bears the burden of showing that the substantial gainful activity that claimant can fulfill exists in significant numbers in the national economy. Parker v. Harris, 626 F.2d 225, 231 (2d Cir. 1980).
In determining Plaintiff's disability status, the Appeals Council adopted the statement of pertinent statutes, regulations, rulings, issues, and evidentiary findings made by AlJ McGuan. (Tr. at 16.) At step one of the determination process, the Appeals Council found that Plaintiff had not been engaged in substantial gainful activity since 1996. (Tr. at 19.) At step two, The Appeals Council found multiple severe impairments, including: bilateral knee dysfunction secondary to arthritis; lumbar spine ...