Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_06-cv-03003/USCOURTS-azd-2_06-cv-03003-0/pdf.json

Nature of Suit Code: 863
Nature of Suit: Social Security - DIWC/DIWW (405(g))
Cause of Action: 42:405 Review of HHS Decision (DIWC)

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IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Douglas S. Gibson, 

Plaintiff, 

vs.

Michael J. Astrue, Commissioner of Social

Security, 

Defendant. 

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No. CV 06-3003-PHX-JAT

ORDER

Plaintiff appeals the decision of the Social Security Commissioner (“Commissioner”)

denying his application for supplemental security income and disability insurance benefits.

Because the Administrative Law Judge (“ALJ”) failed to properly consider the treating

physician’s opinion, the Court will reverse the Commissioner’s decision and remand for

further proceedings.

I. Background

On February 18, 2004, Plaintiff applied for supplemental security income and

disability insurance benefits, alleging a disability onset date of August 5, 2003. Plaintiff

alleged that he was disabled due to a combination of psychological impairments, including

paranoid schizophrenic disorder and borderline personality disorder. At the time of his

alleged onset date, Plaintiff had a more than thirty-five-year history of substance abuse and

had been diagnosed with several substance abuse disorders. Plaintiff’s claims were denied

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initially and on reconsideration. On May 3, 2005, upon Plaintiff’s request, an ALJ held a

hearing at which Plaintiff testified and was represented by counsel. The ALJ issued an

unfavorable decision and denied Plaintiff’s claims. Thereafter, the Social Security Appeals

Council granted Plaintiff’s request for review and remanded the case for further proceedings,

directing the ALJ to consider, among other things, the opinion of Plaintiff’s treating

physician.

On March 20, 2006, Plaintiff appeared and testified at a supplemental hearing before

the ALJ. Following this hearing, the ALJ issued another unfavorable decision, which had

two main components. First, the ALJ found that all of Plaintiff’s various impairments

(including his substance abuse disorders) rendered him disabled. In reaching this conclusion,

he relied on the opinion of Dr. Jasbir Bisla, Plaintiff’s treating physician. Second, the ALJ

found that Plaintiff’s substance abuse was a contributing factor material to the disability

determination and that, as a result, Plaintiff was not disabled within the meaning of the Social

Security Act. The ALJ based this conclusion on the opinions of two state agency doctors;

he did not mention Dr. Bisla’s opinion.

Plaintiff filed a request for review, which the Social Security Appeals Council denied.

Plaintiff then timely filed this appeal on December 13, 2006.

II. Standard of Review

The district court has a limited role in reviewing denials of disability benefits. The

Commissioner’s decision stands unless “‘it is not supported by substantial evidence or . . .

is based on legal error.’” Thomas v. Barnhart, 278 F.3d 947, 954 (9th Cir. 2002) (quoting

Jamerson v. Chater, 112 F.3d 1064, 1066 (9th Cir. 1997)). “Where the evidence is

susceptible to more than one rational interpretation, one of which supports the ALJ’s

decision, the ALJ’s conclusion must be upheld.” Id.

III. Discussion

A. Did the ALJ Commit Reversible Error?

Disability claims are typically resolved within the framework of a five-step sequential

process. 20 C.F.R. §§ 404.1520, 416.920. The claimant bears the burden of proof at the first

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four steps, but the burden shifts to the Commissioner at step five. Bustamante v. Massanari,

262 F.3d 949, 954-55 (9th Cir. 2001). A finding of “not disabled” at any step in the

sequential process will end the inquiry. Id. §§ 404.1520(a)(4), 416.920(a)(4). At step one,

the ALJ determines whether the claimant is “doing substantial gainful activity.” Id. §§

404.1520(a)(4)(i), 416.920(a)(4)(i). At step two, the ALJ determines whether the claimant’s

impairment, or combination of impairments, is “severe.” Id. §§ 404.1520(a)(4)(ii),

416.920(a)(4)(ii). At step three, the ALJ determines whether the impairment “meets or

equals” one of the impairments listed in the regulations. Id. §§ 404.1520(a)(4)(iii),

416.920(a)(4)(iii). At step four, the ALJ determines whether, despite the impairment or

impairments, the claimant can still perform “past relevant work.” Id. §§ 404.1520(a)(4)(iv),

416.920(a)(4)(iv). Finally, at step five, the ALJ determines whether, despite the impairment

or impairments, the claimant “can make an adjustment to other work” that exists in the

national economy. Id. §§ 404.1520(a)(4)(v), 416.920(a)(4)(v).

When substance abuse is involved, however, this five-step process may not be enough

to resolve the disability claim. Since certain 1996 amendments to the Social Security Act,

an individual is not disabled under Title II or Title XVI of the Act “if alcoholism or drug

addiction would (but for this subparagraph) be a contributing factor material to the

Commissioner’s determination that the individual is disabled.” 42 U.S.C. §§ 423(d)(2)(C),

1382c(a)(3)(J). Thus, even if the ALJ finds that all the claimant’s limitations are disabling,

if there is medical evidence of substance abuse, the ALJ must next determine whether the

substance abuse was a contributing factor material to the disability determination. 20 C.F.R.

§§ 404.1535(a), 416.935(a). In substance-abuse cases, therefore, a finding of “disabled”

under the five-step sequential process does not automatically result in an award of benefits;

it merely overcomes the first hurdle to that end. Bustamante, 262 F.3d at 954-55 (holding

that a finding of disability as to all impairments is a prerequisite to evaluating the materiality

of the claimant’s substance abuse).

Two more hurdles follow. After finding the claimant disabled when considering all

impairments, the ALJ must determine which of the claimant’s “current physical and mental

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 The Ninth Circuit has not yet addressed this issue.

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limitations” would remain if he “stopped using drugs or alcohol.” 20 C.F.R. §§

404.1535(b)(2), 416.935(b)(2). The Ninth Circuit has described this step as “separating out

the impact” of the substance abuse. Bustamante, 262 F.3d at 955. The ALJ is not free to

speculate. As with any other aspect of his decision, his finding must be supported by

substantial evidence. See Thomas, 278 F.3d at 954. One circuit has held that if the ALJ is

unable to separate out the impact of substance abuse, the claimant is entitled to benefits.1

Brueggemann v. Barnhart, 348 F.3d 689, 693 (8th Cir. 2003) (citing Soc. Sec. Admin.

Emergency Teletype, No. EM-96-94 at Answer 29 (Aug. 30, 1996)).

If the ALJ is able to separate out the impact of substance abuse, the ALJ must then

determine whether the claimant’s remaining limitations would be disabling. Bustamante, 262

F.3d at 955. To make this determination, the ALJ repeats the five-step sequential process

described above but only analyzes the claimant’s non-substance-abuse-related limitations

when doing so. Id. If the non-substance-abuse-related limitations would be disabling, then

the claimant is entitled to benefits. If the non-substance-abuse-related limitations would not

be disabling, then the claimant’s substance abuse is a contributing factor material to the

disability determination, and the claimant cannot receive benefits. Id.

In sum, substance-abuse-related disability claims involve a three-step inquiry. First,

considering all impairments, including substance abuse, is the claimant disabled? Second,

if the claimant stopped using drugs or alcohol, what would his remaining limitations be?

And third, are the remaining limitations disabling?

Here, after properly finding Plaintiff disabled at step one of this inquiry, the

Commissioner concedes that the ALJ committed legal error at step two by failing to consider

the treating physician’s opinion. Dr. Bisna opined that Plaintiff’s impairments caused him

to suffer several moderately severe limitations. The ALJ relied on this opinion to conclude

that Plaintiff was disabled at step one of the inquiry. But when the ALJ determined

Plaintiff’s non-substance-abuse-related limitations at step two, the ALJ relied wholly on the

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 Plaintiff also argues that the old adage “justice delayed is justice denied” requires

an immediate award of benefits. But vague proverbs and sayings, however laudable they

may be, do not trump Ninth Circuit precedent. Moreover, the present ambiguity in the record

makes it impossible for this Court to detect the just result in this case. An immediate award

of benefits would work an injustice if Plaintiff is ineligible to receive them.

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opinions of two state agency doctors without addressing the significance (or insignificance)

of Dr. Bisna’s opinion. This omission constitutes legal error and mandates reversal.

B. Remand for Further Proceedings or an Award of Benefits?

The remaining issue to be decided is whether to remand for further proceedings or for

an award of benefits. A district court has the discretion to award benefits only when “the

record has been fully developed and where further administrative proceedings would serve

no useful purpose.” Smolen v. Chater, 80 F.3d 1273, 1292 (9th Cir. 1996). Remanding for

benefits is appropriate where (1) the ALJ has failed to properly reject the opinion of a

treating physician and (2) “it is clear from the record that the ALJ would be required to find

the claimant disabled were such evidence credited.” Id.

In this case, even if the Court were to credit Dr. Bisna’s testimony as true, the Court

could not conclude on this record that Plaintiff is entitled to disability benefits. Dr. Bisna

opined that Plaintiff’s impairments resulted in limitations that would, the Commissioner

concedes, qualify as disabling. But on the record before this Court, it is not clear whether

Dr. Bisna based his opinion on Plaintiff’s non-substance-abuse impairments alone. If Dr.

Bisna considered Plaintiff’s substance abuse when he opined about Plaintiff’s limitations,

then his opinion is not necessarily inconsistent with the ALJ’s decision. But if he did not,

then Dr. Bisna’s opinion squarely conflicts with the opinions of the state agency doctors

relied on by the ALJ. Resolution of this ambiguity in the evidence requires remand.2

IV. Conclusion

The ALJ erred by “separating out” the impact of Plaintiff’s substance abuse without

addressing the treating physician’s opinion. An ambiguity in that opinion, however, prevents

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this Court from simply crediting the opinion as true and then deciding whether Plaintiff is

entitled to benefits. Accordingly,

IT IS ORDERED that, consistent with the terms of this Order, Defendant’s Motion

to Remand to the Social Security Administration (Doc. # 24) is GRANTED;

IT IS FURTHER ORDERED that Plaintiff’s Motion for Summary Judgment (Doc.

# 17) is GRANTED to the extent consistent with this Order and DENIED in all other

respects. Because the Court finds error in the ALJ’s determination of Plaintiff’s nonsubstance-abuse limitations, it does not address the remaining claims of error raised in this

appeal.

DATED this 31st day of March, 2008.

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