Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-3_14-cv-08048/USCOURTS-azd-3_14-cv-08048-0/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 (SSID)

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WO 

IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF ARIZONA 

Carla Louise Lyons, 

Plaintiff, 

v. 

Carolyn W. Colvin, 

Defendant.

No. CV-14-08048-PCT-JZB

ORDER 

 Plaintiff Carla Louise Lyons seeks review of the Social Security Administration 

Commissioner’s decision denying her social security benefits under the Social Security 

Act. (Doc. 1; Doc. 20.) The Court finds that the ALJ committed harmful legal error by 

rejecting Plaintiff’s symptom testimony without providing clear and convincing reasons 

supported by substantial evidence at step two of the five-step sequential analysis. 

Therefore, the Court will vacate the Commissioner’s decision and remand this case for 

further proceedings consistent with this Order.1

I. Background 

 On July 8, 2010, Plaintiff filed an application for disability insurance benefits. 

(AR2

 125.) Plaintiff asserts disability beginning on June 1, 2008.3 (Id.) Plaintiff’s 

 

1

 This matter is suitable for resolution based on the briefs. Accordingly, the Court denies Plaintiff’s request for oral argument. See Fed. R. Civ. P. 78(b); Partridge v. Reich, 141 

F.3d 920, 926 (9th Cir. 1998). 

2

 Citations to “AR” are to the Administrative Record. 

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application was initially denied on November 17, 2010, and upon reconsideration on 

April 6, 2011. (Id. at 79-81, 87-89.) Subsequently, Plaintiff’s application was set for a 

hearing, which was held on September 20, 2012. (Id. at 33, 112.) In a decision dated 

November 30, 2012, Administrative Law Judge (ALJ) Philip E. Moulaison denied 

Plaintiff’s application for benefits. (Id. at 22-29.) On February 6, 2014, the Appeals 

Council denied Plaintiff’s request for review of the ALJ’s decision, making the ALJ’s 

decision the final decision of the Commissioner of the Social Security Administration. 

(Id. at 1-6.) 

 Having exhausted the administrative review process, on March 27, 2014, Plaintiff 

sought judicial review of the ALJ’s decision by filing a Complaint with this Court 

pursuant to 42 U.S.C. § 405(g). (Doc. 1.) On November 25, 2014, Plaintiff filed an 

Opening Brief, seeking remand of this case to the Social Security Administration for an 

award of benefits. (Doc. 20.) On January 23, 2015, Defendant filed a Response Brief in 

support of the Commissioner’s decision. (Doc. 25.) On February 18, 2015, Plaintiff filed 

a Reply Brief. (Doc. 28.) 

II. Standard of Review 

 The Social Security Act, 42 U.S.C. § 405(g), provides for judicial review of the 

Commissioner’s disability benefits determinations. The Court may set aside the 

Commissioner’s disability determination only if the determination is not supported by 

substantial evidence or is based on legal error. Orn v. Astrue, 495 F.3d 625, 630 (9th Cir. 

2007); Marcia v. Sullivan, 900 F.2d 172, 174 (9th Cir. 1990). “‘Substantial evidence’ 

means more than a mere scintilla, but less than a preponderance; it is such relevant 

evidence as a reasonable person might accept as adequate to support a conclusion.” 

Lingenfelter v. Astrue, 504 F.3d 1028, 1035 (9th Cir. 2007); see also Reddick v. Chater,

157 F.3d 715, 720 (9th Cir. 1998). 

 

3

 Plaintiff amended her onset date during the administrative hearing on September 20, 2012. (Id. at 36-37.) 

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 In determining whether substantial evidence supports the ALJ’s decision, the 

Court considers the record as a whole, weighing both the evidence that supports and that 

which detracts from the ALJ’s conclusions. Reddick, 157 F.3d at 720; Tylitzki v. Shalala, 

999 F.2d 1411, 1413 (9th Cir. 1993). The ALJ is responsible for resolving conflicts, 

ambiguity, and determining credibility. Andrews v. Shalala, 53 F.3d 1035, 1039 (9th Cir. 

1995); Magallanes v. Bowen, 881 F.2d 747, 750 (9th Cir. 1989). The Court “must 

uphold the ALJ’s decision where the evidence is susceptible to more than one rational 

interpretation.” Andrews, 53 F.3d at 1039. “However, a reviewing court must consider 

the entire record as a whole and may not affirm simply by isolating a ‘specific quantum 

of supporting evidence.’” Orn, 495 F.3d at 630 (quoting Robbins v. Soc. Sec. Admin., 466 

F.3d 880, 882 (9th Cir. 2006)). The Court reviews only those issues raised by the party 

challenging the ALJ’s decision. See Lewis v. Apfel, 236 F.3d 503, 517 n.13 (9th Cir. 

2001). Similarly, the Court reviews “only the reasons provided by the ALJ in the 

disability determination and may not affirm the ALJ on a ground upon which he did not 

rely.” Garrison v. Colvin, 759 F.3d 995, 1010 (9th Cir. 2014).

III. Step-Two Severity Analysis 

To be eligible for Social Security benefits, a claimant must show an “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); see also Tackett v. Apfel, 180 F.3d 1094, 1098 (9th Cir. 1999). A 

person is under a disability only: 

if his physical or mental impairment or impairments are of 

such severity that he is not only unable to do his previous work but cannot, considering his age, education, and work experience, engage in any other kind of substantial gainful work which exists in the national economy. 

42 U.S.C. § 423(d)(2)(A). 

The ALJ follows a five-step evaluation process to determine whether an applicant 

is disabled under the Social Security Act: 

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The five-step process for disability determinations begins, at the first and second steps, by asking whether a claimant is engaged in “substantial gainful activity” and considering the severity of the claimant’s impairments. See 20 C.F.R. § 

416.920(a)(4)(i)-(ii). If the inquiry continues beyond the 

second step, the third step asks whether the claimant’s 

impairment or combination of impairments meets or equals a listing under 20 C.F.R. pt. 404, subpt. P, app. 1 and meets the duration requirement. See id. § 416.920(a)(4)(iii). If so, the 

claimant is considered disabled and benefits are awarded, 

ending the inquiry. See id. If the process continues beyond the third step, the fourth and fifth steps consider the claimant’s “residual functional capacity” in determining whether the claimant can still do past relevant work or make an adjustment to other work. See id. § 416.920(a)(4)(iv)-(v). 

Kennedy v. Colvin, 738 F.3d 1172, 1175 (9th Cir. 2013). “The burden of proof is on the 

claimant at steps one through four, but shifts to the Commissioner at step five.” Bray v. 

Comm’r of Soc. Sec. Admin., 554 F.3d 1219, 1222 (9th Cir. 2009). Here, the ALJ found 

Plaintiff was not disabled under the Act at step two of the evaluation process. 

 “[A]t the second step of [the] sequential evaluation it must be determined whether 

medical evidence establishes an impairment or combination of impairments ‘of such 

severity’ as to be the basis of a finding of inability to engage in any [substantial gainful 

employment].” SSR 85-28. A “severe” impairment is “any impairment or combination 

of impairments which significantly limits [a claimant’s] physical or mental ability to do 

basic work activities.” 20 C.F.R. § 404.1520(c). Basic work activities include: “(1) 

Physical functions such as walking, standing, sitting, lifting, pushing, pulling, reaching, 

carrying, or handling; (2) Capacities for seeing, hearing, and speaking; (3) 

Understanding, carrying out, and remembering simple instructions; (4) Use of judgment; 

(5) Responding appropriately to supervision, co-workers and usual work situations; and 

(6) Dealing with changes in a routine work setting.” 20 C.F.R. § 404.1521(b). “An 

impairment is not severe if it is merely ‘a slight abnormality (or combination of slight 

abnormalities) that has no more than a minimal effect on the ability to do basic work 

activities.’” Webb v. Barnhart, 433 F.3d 683, 686 (9th Cir. 2005) (quoting SSR 96-3p). 

 “[T]he step-two inquiry is a de minimis screening device to dispose of groundless 

claims.” Smolen v. Chater, 80 F.3d 1273, 1290 (9th Cir. 1996) (citing Bowen v. 

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Yuckert, 482 U.S. 137, 153–54 (1987)). The inquiry “is to do no more than allow the 

[Social Security Administration] to deny benefits summarily to those applicants with 

impairments of a minimal nature which could never prevent a person from working.” 

SSR 85-28 (internal quotations omitted). Therefore, “an ALJ may find that a claimant 

lacks a medically severe impairment or combination of impairments only when his 

conclusion is ‘clearly established by medical evidence.’” Webb, 433 F.3d at 687 (quoting 

SSR 85-28). “‘[I]f an adjudicator is unable to determine clearly the effect of an 

impairment or combination of impairments on the individual’s ability to do basic work 

activities, the sequential evaluation should not end with the not severe evaluation 

step.’” Id. (quoting SSR 85–28). Further, the ALJ “is required to consider the claimant’s 

subjective symptoms, such as pain or fatigue, in determining severity.” Smolen, 80 F.3d 

at 1290 (citing SSR 88-13). Thus, the Court’s task in reviewing a denial of benefits at 

step two is to “determine whether the ALJ had substantial evidence to find that the 

medical evidence clearly established that [Plaintiff] did not have a medically severe 

impairment or combination of impairments.” Webb, 433 F.3d at 687.

IV. The ALJ’s Determination 

 The ALJ concluded that Plaintiff was not “disabled,” as the term is defined in 42 

U.S.C. §§ 416, 423. (AR 22.) In following the five-step sequential evaluation process 

used for determining whether an individual is disabled, see 20 C.F.R. § 404.1520(a)(4), 

the ALJ concluded at step one that Plaintiff “did not engage in substantial gainful activity 

during the period from her alleged onset date of June 6, 2007, through her date last 

insured of June 30, 2011.” (Id. at 24.) At step two, the ALJ found that “[t]hrough the last 

date insured, [Plaintiff] had the following medically determinable impairments: irritable 

bowel syndrome (IBS) and an anxiety disorder.” (Id.) However, the ALJ concluded that 

Plaintiff, “[t]hrough the date last insured, did not have an impairment or combination of 

impairments that significantly limited the ability to perform basic work-related activities 

for 12 consecutive months,” and that Plaintiff’s impairments were therefore not “severe” 

during the relevant period. (Id. at 25.) The ALJ did not continue his analysis beyond 

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step two of the evaluation process. 

 Plaintiff seeks review of the ALJ’s determination that Plaintiff’s IBS and anxiety 

disorder are not, alone, or in combination, severe impairments.4

 (Doc. 20 at 1-2.) More 

specifically, Plaintiff argues that the ALJ erred in rejecting her symptom testimony 

without providing clear and convincing reasons supported by substantial evidence. (Id.) 

Defendant argues that (1) the ALJ properly discounted Plaintiff’s symptom testimony, 

and (2) regardless, the Court should affirm the ALJ’s step-two determination because it is 

supported by substantial evidence. (Doc. 25 at 10-18.) For the reasons detailed below, 

the Court finds that the ALJ erred in rejecting Plaintiff’s symptom testimony at step two, 

and that error is not harmless. 

a. Legal Standard Regarding Symptom Testimony 

 An ALJ engages in a two-step analysis to determine whether a claimant’s 

testimony regarding subjective pain or symptoms is credible. Garrison, 759 F.3d at 

1014-15 (citing Lingenfelter, 504 F.3d at 1035-36). “First, the ALJ must determine 

whether the claimant has presented objective medical evidence of an underlying 

impairment ‘which could reasonably be expected to produce the pain or other symptoms 

alleged.’” Lingenfelter, 504 F.3d at 1036 (quoting Bunnell v. Sullivan, 947 F.2d 341, 344 

(9th Cir. 1991) (en banc)). The claimant is not required to show objective medical 

evidence of the pain itself or of a causal relationship between the impairment and the 

symptom. Smolen, 80 F.3d at 1282. Instead, the claimant must only show that an 

objectively verifiable impairment “could reasonably be expected to produce his pain.” 

Lingenfelter, 504 F.3d at 1036 (quoting Smolen, 80 F.3d at 1282); see also Carmickle v. 

Comm’r, SSA, 533 F.3d 1155, 1160-61 (9th Cir. 2008) (“requiring that the medical 

impairment ‘could reasonably be expected to produce’ pain or another symptom . . . 

requires only that the causal relationship be a reasonable inference, not a medically 

proven phenomenon”).

 

4

 The ALJ did not find any medically determinable impairment related to Plaintiff’s 

reported back and upper extremity pain. (Id. at 24.) Plaintiff does not challenge that finding. (See Doc. 20.) 

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 Second, if a claimant shows that she suffers from an underlying medical 

impairment that could reasonably be expected to produce her pain or other symptoms, the 

ALJ must “evaluate the intensity and persistence of [the] symptoms” to determine how 

the symptoms, including pain, limit the claimant’s ability to work. See 20 C.F.R. § 

404.1529(c)(1). In making credibility determinations, general assertions that the 

claimant’s testimony is not credible are insufficient. See Parra v. Astrue, 481 F.3d 742, 

750 (9th Cir. 2007). The ALJ must identify “what testimony is not credible and what 

evidence undermines the claimant’s complaints.” Id. (quoting Lester, 81 F.3d at 834); see 

also Brown-Hunter v. Colvin, ___ F.3d ____, 2015 WL 4620123 at *6 (9th Cir 2015) 

(finding error where the ALJ stated only that “she found, based on unspecified claimant 

testimony and a summary of medical evidence,” that “‘the functional limitations from the 

claimant’s impairments were less serious than she has alleged’”). 

 In weighing a claimant’s credibility, the ALJ may consider many factors, 

including: “(1) ordinary techniques of credibility evaluation, such as the claimant’s 

reputation for lying, prior inconsistent statements concerning the symptoms, and other 

testimony by the claimant that appears less than candid; (2) unexplained or inadequately 

explained failure to seek treatment or to follow a prescribed course of treatment; and (3) 

the claimant’s daily activities.” Smolen, 80 F.3d at 1284; see Orn, 495 F.3d at 637-39. 

The ALJ also considers “the claimant’s work record and observations of treating and 

examining physicians and other third parties regarding, among other matters, the nature, 

onset, duration, and frequency of the claimant’s symptom; precipitating and aggravating 

factors; [and] functional restrictions caused by the symptoms . . . .” Smolen, 80 F.3d at 

1284 (citing SSR 88-13). 

 At this second step, the ALJ may reject a claimant’s testimony regarding the 

severity of his or her symptoms only if the ALJ “makes a finding of malingering based on 

affirmative evidence,” Lingenfelter, 504 F.3d at 1036 (quoting Robbins, 466 F.3d at 883), 

or if the ALJ offers “clear and convincing reasons” for finding the claimant not credible. 

Carmickle, 533 F.3d at 1160 (quoting Lingenfelter, 504 F.3d at 1036). “‘The clear and 

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convincing standard is the most demanding required in Social Security Cases.’” 

Garrison, 793 F.3d at 1015 (quoting Moore v. Soc. Sec. Admin., 278 F.3d 920, 924 (9th 

Cir. 2002)). 

 Here, because there was no affirmative finding of malingering, the ALJ was 

required to provide clear and convincing reasons supported by substantial evidence for 

concluding that Plaintiff’s subjective complaints were not wholly credible. 

b. The ALJ failed to provide clear and convincing reasons supported by substantial evidence for rejecting Plaintiff’s symptom testimony at step 

two.

 With regard to Plaintiff’s testimony, the ALJ first found that Plaintiff’s medically 

determinable impairments could reasonably be expected to cause the alleged symptoms. 

(AR 26.) The ALJ then found Plaintiff’s “statements regarding the intensity, persistence, 

and limiting effects of [her] symptoms not credible to the extent they are inconsistent 

with finding that [Plaintiff] has no severe impairment or combination of impairments.” 

(Id.) 

 At the hearing, Plaintiff testified that she can only climb a half a flight of stairs, 

walk for 50 yards, stand for 10 minutes, and lift no more than five pounds. (AR 40-41.) 

She also testified that she experiences an average of six bowel movements a day. (Id. at 

44.) Her bowel movements last 15-20 minutes, and if she doesn’t make it to the 

bathroom in time—which she says happens frequently—she has to take a shower 

afterward. (Id.) Plaintiff claimed that she has to take a shower four to six times a day. 

(Id. at 45.) Plaintiff further testified that, even when she is not having a bowel 

movement, she suffers from near-constant abdominal pain, fatigue, and lack of sleep 

related to IBS. (Id. at 44-45.) Plaintiff also testified to having a fistula. She claims she 

was told that if she does not receive surgery, she will die due to related complications, but 

that she does not have the money to pay for the surgery. (Id. at 45.) She also gets many 

yeast infections due to the fistula, and it causes her to have a bowel movement when she 

coughs or sneezes. (Id.) 

 Additionally, Plaintiff testified that she suffers from panic attacks caused by fear 

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of leaving her house. (Id. at 43, 48.) These attacks can last two to three hours, though 

they last on average an hour to an hour-and-a-half, and are triggered by Plaintiff’s fear 

that she will have a bowel movement or urinate in public. (Id.) She explained that, while 

the medications she takes for her panic attacks help for a very short time, they do not ease 

her anxiety completely. (Id. at 43.) She claimed that her husband has to perform most 

work for her. (Id. at 47.) She also suffers from depression caused by her anxiety and 

IBS. (Id. at 48.) 

 The ALJ rejected Plaintiff’s testimony regarding the severity of her impairments 

for the following reasons: (1) there was generally a lack of corroborating medical 

evidence, (2) Plaintiff alleged she suffered from constant diarrhea, but she did not have a 

“significant change in diet or evidence of significant weight loss that might be expected,” 

(3) there was no evidence that her anxiety was not well controlled on her medication, or 

that she experienced any side effects from her medication, (4) she “described a range of 

daily activity to Dr. Shepard that is not as limited as one would expect for a disabled 

individual,” (5) when seen by Dr. Katigbak on September 6, 2012, she denied diarrhea, 

nausea, and vomiting, (6) the existence of a fistula was not proven by medical evidence, 

and (7) none of her treating or examining physicians found any functional limitations. 

(Id. at 27-28.) The Court finds these are not clear and convincing reasons supported by 

substantial evidence for rejecting Plaintiff’s symptom testimony. 

 First, although many of the medical records that the ALJ discussed indicate mild 

symptoms, the absence of fully corroborative medical evidence cannot form the sole 

basis for rejecting the credibility of a claimant’s subjective complaints. See Cotton v. 

Bowen, 799 F.2d 1403, 1407 (9th Cir. 1986) (it is legal error for “an ALJ to discredit 

excess pain testimony solely on the ground that it is not fully corroborated by objective 

medical findings”), superseded by statute on other grounds as stated in Bunnell v. 

Sullivan, 912 F.2d 1149 (9th Cir. 1990); see also Burch v. Barnhart, 400 F.3d 676, 681 

(9th Cir. 2005) (explaining that the “lack of medical evidence” can be “a factor” in 

rejecting credibility, but cannot “form the sole basis”). 

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 Further, with regard to Plaintiff’s weight and diet, the ALJ failed explain how he 

would expect Plaintiff’s weight or diet to change due to her IBS, and how this impacts 

her credibility. There is evidence that Plaintiff’s providers recommended in 2009 a diet 

high in fiber and to include Activia yogurt. (AR 224.) However, the ALJ does not cite to 

evidence that Plaintiff failed to adhere to a prescribed diet. The ALJ failed to explain 

how a lack of change in Plaintiff’s weight or diet undermines her credibility and, 

therefore, Plaintiff’s weight and diet are not clear and convincing reasons supported by 

substantial evidence for rejecting Plaintiff’s symptom testimony. See Lester, 81 F.3d at 

834. 

 Additionally, with respect to Plaintiff’s allegations of anxiety, the ALJ found 

Plaintiff’s testimony not credible because there is no evidence that Plaintiff’s anxiety was 

not well-controlled with her Atarax prescription, and there is no evidence that Plaintiff 

suffered side effects from her medications. (AR 27-28.) In assessing a claimant’s 

credibility about her symptoms, the ALJ may consider “the type, dosage, effectiveness, 

and side effects of any medication” and treatment, other than medication, that the 

claimant has received for relief of pain or other symptoms. 20 C.F.R. § 

404.1529(c)(3)(iv) and (v). Further, evidence that treatment can control a claimant’s 

symptoms may be a clear and convincing reason to find a claimant less credible. See 

Warre v. Comm’r of Soc. Sec. Admin., 439 F.3d 1001, 1006 (9th Cir. 2006) (stating that 

“[i]mpairments that can be controlled effectively with medication are not disabling for 

purposes of determining eligibility for SSI benefits.”) However, here, although the ALJ 

cited to Dr. Javine’s findings, he does not cite to any other medical records that 

specifically address the impact of Plaintiff’s medication. Further, even if there were no 

side effects from her medication, Plaintiff was continuously prescribed medication for 

anxiety and there is some evidence in the record that she continued to have symptoms, 

but could not obtain mental health treatment due to not having insurance. (See AR 214-

38, 243-44, 278-312.) Additionally, this reason does address Plaintiff’s testimony 

regarding the severity of her IBS symptoms. Therefore, the Court does not find that this 

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is a sufficient basis on which to reject Plaintiff’s symptom testimony at step two. 

 The ALJ also relied on Plaintiff’s daily activities in rejecting her symptom 

testimony. (Id. at 28.) However, rather than relying on those daily activities to discredit 

specific testimony, the ALJ concluded simply that Plaintiff “described a range of daily 

activity to Dr. Shepherd that is not as limited as one would expect for a disabled 

individual.” (Id.) The ALJ cites to Dr. Shepherd’s report stating that “[Plaintiff] is able 

to care for her personal needs, . . . perform house work and yard work. She can vacuum. 

She is able to drive. She enjoys reading and swimming. She enjoys working on the 

computer.” (Id. at 247-48.) 

 While an ALJ may discredit a claimant’s allegations if a claimant has “engaged in 

numerous daily activities involving skills that could be transferred to the workplace,” 

Burch, 400 F.3d at 681, “the mere fact that a plaintiff has carried on certain daily 

activities, such as grocery shopping, driving a car, or limited walking for exercise, does 

not in any way detract from her credibility as to her overall disability. One does not need 

to be utterly incapacitated in order to be disabled.” Vertigan v. Halter, 260 F.3d 1044, 

1049-50 (9th Cir. 2001) (citing Fair v. Bowen, 885 F.2d 597, 603 (9th Cir. 1989)) 

(finding “only a scintilla of evidence in the record to support the ALJ’s finding that [the 

claimant] lacked credibility about her pain” where the claimant was able “to go grocery 

shopping with assistance, walk approximately an hour in the malls, get together with her 

friends, play cards, swim, watch television, . . . read. . . . and exercise at home.”). 

 Here, although Plaintiff engaged in some daily activities, the evidence in the 

record suggests those activities were limited. Dr. Javine, to whose opinion, along with 

Dr. Shepherd’s, the ALJ assigned “the most weight” in his decision (AR 27), stated that 

Plaintiff swims “a couple times a week,” and that she “does not vacuum, wash tubs, 

toilets, . . . or do laundry.” (Id. at 240.) According to Dr. Javine’s report, the extent of 

Plaintiff’s housework is that she does the dishes and dusts. (Id.) Plaintiff also testified 

that she only drives about once a week. (Id. at 38.) The ALJ’s single-sentence finding, 

that “[Plaintiff] described a range of daily activity . . . that is not as limited as one would 

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expect for a disabled individual,” does not constitute a specific, clear and convincing 

reason supported by substantial evidence for discrediting Plaintiff’s symptom testimony. 

 The Court also finds that the inconsistencies with the medical record the ALJ 

identified are not clear and convincing reasons supported by substantial evidence for 

rejecting Plaintiff’s testimony at step two. The ALJ specifically noted that although 

Plaintiff testified she has constant diarrhea, she denied experiencing diarrhea to Dr. 

Katigbak in 2012. “Contradiction with the medical record is a sufficient basis for 

rejecting the claimant’s subjective testimony.” Carmickle, 533 F.3d at 1161 (citing 

Johnson v. Shalala, 60 F.3d 1428, 1434 (9th Cir. 1995)). However, in light of the other 

medical evidence in the record regarding Plaintiff’s IBS symptoms, including diarrhea 

and abdominal pain (see, e.g., AR 214-38), the Court finds that the ALJ’s citation to one 

progress report where she denied experiencing diarrhea is an insufficient basis on which 

to reject her testimony regarding the severity of her condition. 

 The ALJ also rejected Plaintiff’s testimony because although there was suspicion 

of a rectovaginal fistula, it “was not proven by medical evidence.” (Id. at 28.) As 

Plaintiff notes, there are medical records that indicate a fistula exists. Records from 

Plaintiff’s gastroenterologist, Dr. Josh Zara, state that “the frequent passage of stool via 

the vagina [is] suggestive of a fistula between the rectum and the vagina,” (id. at 198), 

and, although he could not find the fistula during the 2009 colonoscopy, he did state “but 

based on [Plaintiff’s] history it has to be present.” (Id. at 196.) Further, Dr. Katigbak 

noted that Plaintiff’s gynecologist suspected Plaintiff has a fistula. (Id. at 219.) 

Additionally, the ALJ fails to explain how the lack of proof of a fistula undermines 

Plaintiff’s credibility regarding her symptoms related to her IBS. Lack of proof of a 

fistula is therefore not a sufficient basis on which to reject Plaintiff’s testimony. See 

Cotton, 799 F.2d at 1407. 

 Finally, the ALJ’s general assertion that Plaintiff’s treating and examining 

physicians did not find functional limitations is insufficient. (Id. at 28.) As the Ninth 

Circuit recently reiterated, “[o]ur decisions make clear that we may not take a general 

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finding—an unspecified conflict between Claimant’s testimony . . . and her reports to 

doctors—and comb through the record to find specific conflicts.” Brown-Hunter, 2015 

WL 4620123 at *6 (quoting Burrell v. Colvin, 775 F.3d 1133, 1138 (9th Cir. 2014)). 

Defendant cites to Carmickle, 533 F.3d at 1160, to argue that “contradiction with the 

medical record is a sufficient basis for rejecting the claimant’s subjective complaints.” 

(Doc. 25 at 10.) However, the ALJ in Carmickle cited to specific testimony the plaintiff 

gave regarding the amount of weight he can lift and the length of time he can sit, and the 

ALJ explained how inconsistencies between specific medical records and the plaintiff’s 

testimony undermined the plaintiff’s credibility. See Carmickle, 533 F.3d at 1161. Here, 

although the ALJ notes that Dr. Shepard and Dr. Javine found no functional limitations, 

he fails to identify with specificity inconsistencies between Plaintiff’s testimony and their 

findings regarding her functional limitations, and to explain how the findings specifically 

undermine Plaintiff’s credibility.5

 

 For these reasons, when balanced against the other medical evidence in the record 

regarding Plaintiff’s conditions, the Court cannot find that the ALJ’s reasons for rejecting 

Plaintiff’s testimony were sufficient at step two. See Webb, 433 F.3d at 687 (finding “the 

ALJ’s reasons for rejecting Webb’s complaints at step two are not substantial enough to 

meet the ‘clear and convincing’ standard when balanced against Webb’s doctors’ 

contemporaneous observations, some objective tests and Webb’s subjective complaints”). 

c. The ALJ’s error is not harmless. 

 Although Plaintiff does not specifically challenge the ALJ’s decision as not 

supported by substantial evidence, Defendant appears to argue that regardless of the 

 

5

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imagining and normal examination results on the other. (Doc. 25 at 15.) Although the ALJ discussed this evidence in his decision, he did not specifically make this comparison or reject Plaintiff’s testimony based on this inconsistency. See Brown-Hunter, 2015 WL 

4620123 at *6 (“. . . inconsistencies identified independently by the district court cannot provide the basis upon which we can affirm the ALJ’s decision”). Further, Plaintiff 

testified that she experienced pain and fatigue related to her IBS and stomach pain, which may not necessarily be detected by imaging or physical examinations. (AR 38, 44-45.) 

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ALJ’s treatment of Plaintiff’s symptom testimony, the Court should affirm the ALJ’s 

step-two determination because it is supported by substantial evidence. (Doc. 25 at 8-

11.) The Court disagrees. 

 “A decision of the ALJ will not be reversed for errors that are harmless.” Burch, 

400 F.3d at 679. “So long as there remains ‘substantial evidence supporting the ALJ’s 

conclusions on . . . credibility’ and the error ‘does not negate the validity of the ALJ’s 

ultimate credibility conclusion,’ [the ALJ’s error] is deemed harmless and does not 

warrant reversal.” Carmickle, 533 F.3d at 1162 (quoting Batson v. Comm'r of Soc. Sec. 

Admin., 359 F.3d 1190, 1197 (9th Cir. 2004)). An ALJ’s error is harmless if it is 

“inconsequential to the ultimate nondisability determination.” Stout v. Comm’r, Soc. Sec. 

Admin, 454 F.3d 1050, 1054-55 (9th Cir. 2006). Here, the ALJ explicitly evaluated and 

relied on both medical evidence and symptom testimony in making his step-two 

determination, and he did not continue on to the remaining steps in the five-step 

evaluation process. Therefore, the ALJ’s error in rejecting Plaintiff’s symptom testimony 

was consequential to the ultimate nondisability determination, and his error is not 

harmless.6

 

V. Remand for further proceedings is appropriate here. 

 Having determined that the ALJ erred, the Court must vacate the Commissioner’s 

decision. The remaining issue for the Court is whether to remand this matter for an 

award of benefits or for further proceedings. Such a determination is within the Court’s 

discretion. Smolen, 80 F.3d at 1292. 

 “When an ALJ’s denial of benefits is not supported by the record, the proper 

course, except in rare circumstances, is to remand to the agency for additional 

investigation or explanation.” Hill v. Astrue, 698 F.3d 1153, 1162 (9th Cir. 2012) 

 

6

 By finding harmful legal error, the Court does not suggest a finding regarding whether Plaintiff is disabled under the Act. However, the ALJ must provide clear and convincing reasons supported by substantial evidence for rejecting Plaintiff’s symptom testimony. Ghanim v. Colvin, 763 F.3d 1154, 1159 (9th Cir. 2014) (the ALJ’s decision must be 

reversed only if it “was not supported by substantial evidence in the record as a whole or 

if the ALJ applied the wrong legal standard.”). 

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(quotation omitted); see also Treichler, 775 F.3d at 1101 (noting that a remand for further 

administrative proceedings is generally useful where the record has not been fully 

developed, there are outstanding conflicts and ambiguities to be resolved, or the 

presentation of further evidence may “prove enlightening.”). The Court applies the 

credit-as-true rule to determine that a claimant is disabled and entitled to an award of 

benefits only if there are no “outstanding issues [in the record] that must be resolved” and 

“it is clear from the record that the ALJ would be required to find the claimant disabled 

were [the improperly rejected] evidence credited.” Harman v. Apfel, 211 F.3d 1172, 

1178 (9th Cir. 2000). However, a “claimant is not entitled to benefits under the statute 

unless the claimant is, in fact, disabled, no matter how egregious the ALJ’s errors may 

be.” Strauss v. Comm’r, Soc. Sec. Admin., 635 F.3d 1135, 1138 (9th Cir. 2011). 

 Here, although the Court finds that the ALJ erred in rejecting Plaintiff’s symptom 

testimony, there is insufficient evidence or analysis beyond step-two of the evaluation 

process to award benefits, and there are many outstanding issues that must be resolved 

before a disability determination can be made. Thus, remand for further proceedings is 

appropriate. 

Accordingly, 

IT IS ORDERED that the Commissioner’s decision is vacated and this matter is 

remanded to the Commissioner for further administrative proceedings consistent with this 

Order. 

IT IS FURTHER ORDERED that the Clerk of the Court shall enter judgment 

accordingly and terminate this case. 

 Dated this 29th day of September, 2015. 

Honorable John Z. Boyle

United States Magistrate Judge

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