good morning ladies and gentleman we are doing the argument today remotely and of course that creates a potential problem of people not knowing when others are trying to ask questions or s so i will listen as carefully as i can and see if i can keep things in order there is always course a problem that there may be occasional communications difficulties we will work that through at no cost to the attorneys time also try to give people warnings when rebuttal time begins or when there is one minute left in the argument so our st oral argument this morning is mr craig thank you your honor and may actually the court in this case presents a question of statutory interpretation the interpretation of the statute offered by the social security administration and adored by the district court rejects the clear statutory definitions provided by congress and by the international agreements between the united states canada and quebec it also disregards is i are very good yes your before we get into the merits i have a question about it is your honor lorraine beeler and the other beneficiaries did present their claims to the agency lorraine beeler herself of the district court noted actually received a final decision while the case was pending but in the meantime the district court as you did surely waived exhaustion of administrative remedies for ms beeler and the other named class members as long as it is on as we are agreed all asked the same question as sony the claim was presented to the agency we don't have a problem under one ok please proceed thank you your honor because we have a case of statutory interpretation we began with the language of the statute and the relevant language is split across various sections of the security act and then that also requires us to look at the international agreements so the key statute in this the st part of it is for you to united states code section fo fifteen specifically subsection seven a two and that section has that section defines the scope of the web and it provides an exclusion from the web and importantly for our game today the beneficiaries argument is based upon the scope of the web and not the exclusion from the web as earlier a case is decided by this court and other courts have been so when we look at the scope apologize your honor so the the statute defines the scope of the when fall emanation provision is sometimes abbreviated the we are we are not specialists so if you would use real in english words i think that would help us  i will i will do so your honor thank you for the reminder and looking at the scope of the windfall emanation provision that section says it applies to people quote who st a person quote who st becomes whole or in part up on his or her our name for a service which did not constitute employment as the five in section four hundred and ten dollars of the title and so then of course we have to look at the definition of employment provided in section fo service regardless of where or by whom performed which is designated as employment or recognizes equivalent to employment under an agreement entered into under section four hundred and thirty three dollars of this title section four hundred and thirty three dollars of the social security act is the statute that authorizes the president to enter into international agreements for social security concerns of security benefits and the agreements themselves leave the determination of what constitutes employment to the domestic laws of the contracting state and importantly it is undisputed that all the members of the class all the beneficiaries here received canada pension plan or quebec pension plan benefits as a result of work that canada recognizes as employment so the social security administration response of the district court accepted this argument that employment means disservice which is designated as employment or recognized as equivalent to employment in the united states system but i think if we agree with your argument does that make the parent exclusion in section four hundred and fifteen of the provision number two with respect to totalization benefits completely unnecessary no it doesn't make it unnecessary your honor section defining the scope of the web so the scope of the web has always been defined the same way in terms of the relevant you know why the the exclusion still has ongoing vitality it makes clear that you know when when people receive a south a security benefit that is based not entirely on service in either country but is kind of put provision is defined in that way it may be unclear whether when the benefits are as a total lived whether that would fall within the definition or not and the exclusion makes clear b the phrase but not under both how are we to read that and consider that of your argument well that makes clear that when employment is to be employment wages are to be taxed or when the when there's going to be a determination of which section which countries so security laws cover the employment it will be  by in this case the united states or canada but not both at the same time but that section doesn't doesn't mean that something that is employment isn't covered under an international agreement if it's not covered by us of security taxes on the contrary the the agreement makes clear that employment can be covered under either canada system or the united states system but not both at the same time and i don't see that phrase at the same time in that in this statute were you getting that qualifier well others and of course as the beneficiaries in this case show at different times it can be subject to you know candidate at one time of the united states as another this  is you know i think this that you just make clear that any employment is going to be allocated to either one system or the others the coverage is bilateral in the sense that it is going to be would you agree that if we agree with your position here that your client's innocence would be getting a windfall no your honor they would not be getting a when fall they are not of the the district court follow and social security's arguments ascribed to beneficiaries the argument that their wages in canada should count for their social security benefits that's never been t the beneficiaries seek only the social security benefits earned by the employment that was covered by us of security taxes and all of the named beneficiaries in this case and all members of the  is reducing those benefits because of benefits that were independently earned in canada so it's not a windfall to the beneficiaries to receive the amount to which they benefit under so security for work that was packed by canada and that's simply not the case but aren't you asking under your construction of this at the time that they worked in canada not that they would get social security benefits for that period of time but the time they worked in canada where they were getting canadian benefits under the us system that time period would essentially be calculated as if they were unemployed  it would be calculated it well they're going to the primary insurance amount under social security calculated without regard to that employment that's true your honor and would it be calculated as if they were unemployed during that period to increase to result in an increase in benefits it doesn't increase their benefit due to the progressive nature of social security payments of time however if it it might be their benefit may be proportionally higher than if they had worked the entire time in the united states that's true so why wouldn't that be a windfall and maybe it is and that's just the way the the statute there's a loophole to it but it seems to me whether you look at it that it's proportionally higher or they're getting more taxes which i understand you're not pursuing that line but wouldn't that still be a windfall if it's proportionally higher i think as well i'm only going to use the word when fall as as  so security act and it's also important to know i think that you know when we talk about windfall the windfall emanation provision was really brought about because of people are on average much higher than the canada pension plan or project pension plan amounts which are are lower or both and so security benefits as well as difficult municipal or state pension benefit and that's significant because i think it's clear from the statutory language of the security act as well as on the international agreements that congress has an attempt was that the contracting parties would work out between themselves if there were going to be reductions based on receipt of other countries you know in other countries benefits and here as we point out canada does not reduce the amounts paid to beneficiaries under the canada pension plan or the thank you your honor and may please the court this official said the commissioner of social security i'd like to get right to this windfall what is the windfall with respect to these plaintiffs we start with the fact based on their work here when they paid into the us system the way that the us benefit is calculated based on the statutory formula that is heavily weighted to give an advantage to people who are low wage earners in that way since the beginning the problem is that the formula averages your wages over the course of about thirty five years and the effect of that between someone who spent thirty five years in low wage covered employment and someone who spent ten years in covered employment of anyway and twenty five years in non covered employment on which they did not pay any social security taxes does that even though these two people are not similarly situated the person who worked in non covered employment typically gets a pension and so when the person in whole or in part on earnings for non covered services and for those people a different adjusted formula applied it's a formula that gives them the correct benefit and it takes away the weighted advantage that was only intended to go who are low wage earners this is this applies this windfall provision applies across the board will guard less of where you actually performed your non covered work it applies to people who work their entire time in the us in covered in non covered employment so for instance as the plaintiff mentions state and local employees such as police and firefighters federal government employees before nine hundred who were hired for ninety four none of them was doing what was defined as employment under the social security act none of them paid social security taxes on that  work if they qualify for social security benefits because at some point they did work and covered it for them and they are getting their civil service pension then the windfall provision applies to them the same way it applies to plan and there's nothing in the statute or in the legislative history that indicates that congress intended it to apply to policemen and firefighters but not to people who work in another country so i hope that explains where the windfall is the windfall is not that these individuals are getting money from canada when fall is this way to benefit that they were never intended to receive and the windfall provision is to get is to give them their correct benefits under an adjusted formula your honor has also asked a question about here and they now want to read characterize past period of employment when they were participating in the canadian system they want to reach character characterize that as both covered by canadian law and covered by the us law and that is inconsistent with the statute for a number of different reasons one of which is that as a district court pointed out there is a provision in the social security act that says employment gives rise to a period of coverage under the us system or under the foreign country's system but not under b that you cannot have a period of coverage a period of work in canada that was both part of the canadian system and part of the us system because being part of the us if the means by definition you were the contribution requirement applied to you that's what the statutes trying to prevent trying to prevent dual taxation it also their interpretation conflicts with another part of the statute which is the authorization for the total station agreement and for totalizing of benefits and that's where it gets into that's where it gets into the exception that it is a windfall provision as well there's the exception for total life form benefits under their interpretation if the work that they did is retroactively covered employment for purposes of the us social security act then you don't need to ever talk like benefit because the formulas look at covered employment you establish your ability to go to based on your periods of coverage meaning you're covered employment so they would simply add the period where you had worked in canada and establish eligibility for coverage there in the new move to the u s but you work only six quarters six quarters isn't enough you have to have forty quarters of coverage in order to get benefits under the u s system so you don't have that you have an effect and a physic totalization agreement in place as there is you are allowed to get credit for the work that you did in canada that was covered under canadian law you benefit because you didn't actually that wasn't actually covered employment us and you didn't pay into the u s so there's a provision that statute that says in that circumstance in your total i think u s benefit you get a pro rated u s benefit that reflects only your period where you work in covered employment in the u s you're going to get a fraction you're going to get six over forty that percentage but in the u s missoni look even though in your your i understand the argument you're making about the intent of the provisions but looking at the plain language the windfall provision incorporates the definition of employment section for ten yes you if i understand your argument you're arguing in the district court agreed that that definition of employment is equated employment as opposed to just employment whether covered or not but again i would take a step back and i would say under the u s system the social security act define employment in section four hundred and ten dollars only for the purpose of determining when the contribution requirement applies if it isn't work if the work is not employment as defined in the social security act then the contribution requirement doesn't apply is there anything in the social security act so that says that it can only be employment in that sense the court's understand it congress understand that if you look at the legislative history of the provisions they use non covered service non covered and point it to me employment on which there was work that was not defined as the provision which is based in whole or in part is not covered service it seems to me that you're reading an extra definition into your hon reason that employment is defined in the statute is for the purposes of determining when the contribution requirement attaches that is the foundation of the social security system benefits are only awarded based on the fact that you have contributed to the system if you didn't contribute to the system you don't get benefit that's why you have to define what is employment for purposes with that so for instance that person who worked for the federal government before nineteen eighty four if they worked their entire career for the federal government and they did not ever work in non covered employees they did not ever work in covered employment they do not get a their entire argument on things and we can just read that text if it is service regardless of where obama who performed which is designated as an appointment or so playing is the thing that means that if the totalization agreement makes it so and it's important and the problem is the totalization agreement with canada does not say that their work in canada or canadian employer in which they contributed to make the system was actually us employment it does not say that this report corrected it correctly recognize that  agreement with canada designate anything as employment within the meaning of section no in fact so if it's helpful to understand what the totalization agreement  to do they are for limited cooperation between two sovereign nations that have their own laws and their own distinct social security system and they are about who ward would the two countries have different systems it's about points of intersection and one point of intersection where someone let us say for the united states goes to work in canada ordinarily under very scared tauriel principles a place where you work for their purposes or their social security system but it totally is a green it says that the countries can come to an agreement and they can say we will recognize there are certain circumstances when in fact it makes more sense for the person's home country to continue to cover them and require contributions and then the place where they work will step back and that would be for continuity of coverage in the benefit to let's say someone who works in a canadian work united states for a number of years but they don't work for forty quarters and they would like to get some eligibility eligibility but the totalization agreement does not say that borrowing of credit that borrowing a period of coverage means that the working canada that you're borrowing would never total i spent doesn't make any sense for provision equally to people who work entirely in the us the people who work in the us and canada they get treated the same it doesn't mean that the us cannot apply the windfall provision unless canada has a windfall provision that that's not  the reason that countries enter into the field of a sion agreement that's not that they can be wired to have the same laws they're going to have their own separate distinct laws they just have to they cannot discriminate against their citizens and other citizens of other countries and they were awarded the benefit i want to make sure to address any questions that the court may have a cause looking for a very long time government's argument were correct the reference from four hundred and fifteen to four hundred and ten would have been entirely unnecessary further when we talk about coverage under an agreement this is not the same thing as covered by a domestic us the social security taxes and in fact the united states in other cases has has argued  really the opposite position for example and the era like case that we've cited in our brief the court agreeing with the government stated that section four hundred and thirty three dollars quote is not limited to situations in which service is recognized as employment or its equivalent of the citizens of both countries but rather extends to employment or self employment or any service which is recognized as equivalent to employment or self employment under this subject after or the so security system of a foreign country which is part of such an agreement and here it's clear that canada does recognize the service of this dealer and the other beneficiaries as employment and their receiving canada pension plan benefits accordingly with with respect to the agreements being silent on employment that is true we're talking about coverage under an international agreement and in article six section one of the us canada agreement period of coverage is defined to mean a period of payment of contributions or a period of earnings from employment or self employment as a sign or recognize as a period of coverage by the laws under which such period has been completed so that you know again the service can be completed under the laws of one party to the agreement or the other party to the agreement here as dealer and others complete severance under canada and therefore that constitutes employment under the terms of the  agreement now some countries of the with a windfall in the nation of course will apply to people receiving benefits from some countries countries with which the united states does not have an agreement i don't think there's any dispute that  f the beneficiaries here came from a country within the united states not have an agreement that when fall in the nation could be applied to the social insurance payments they were receiving and so the the government here is really trying to read out an entire portion of the statute and and the court should reject that interpretation just briefly addressing the the argument concerning the equal protection section it's never been beneficiaries contention that the united states and canada must have the same laws with respect to benefits and in fact we acknowledge and point out that canada provides actually much lower benefits under the c p p than the united states provides under social security payments however and this again we're looking at the we're looking at the actual case cited and our briefs where the d c circuit recognize that it is our responsibility to read them bunch of international agreements in a matter consistent with the shared expectations of the contracting parties and here there was there was no expectation that the benefits would be unilaterally reduced by one country based on receipts by another as evident by the canadians action in this case and so for that reason and the other reasons express an argument in our braves we have to the courts reverse the district court and order judgment in favor of the pl thank you very much the case is taken under advisement