Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_17-cv-00025/USCOURTS-casd-3_17-cv-00025-1/pdf.json

Nature of Suit Code: 863
Nature of Suit: Social Security - DIWC/DIWW (405(g))
Cause of Action: 42:0405id Review of HHS Decision (SSID)

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FILED 

MAR 2 7 2018 

CLERK US DISTHIC I COURT 

SOU N DISTHICI OF CALIFORNIA 

BY OEPUTY 

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UNITED STATES DISTRICT COURT 

SOUTHERN DISTRICT OF CALIFORNIA 

10 LEE WESLEY OVERTON, 

11 Plaintiff, 

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NANCY A. BERRYHILL, Acting 

Commissioner of Social Security, 

Defendant1

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Case No.: 3:17-cv-00025-BEN-BLM 

ORDER: 

(1) ADOPTING REPORT AND 

RECOMMENDATION; 

(2) GRANTING PLAINTIFF'S 

MOTION FOR SUMMARY 

JUDGMENT; 

(3) DENYING DEFENDANT'S 

CROSS-MOTION FOR SUMMARY 

JUDGMENT; 

(4) DENYING DEFENDANT'S 

MOTION FOR 

RECONSIDERATION; and 

(5) REMANDING FOR FURTHER 

PROCEEDINGS 

27 1 The Court substitutes Nancy A. Berryhill, the Acting Commissioner of Social Security, 

for Carolyn W. Colvin, the former Acting Commissioner of Social Security, as Defendant 28 in this suit. See Fed. R. Civ. P. 25. 

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1 Plaintiff Lee Overton filed this action seeking judicial review of the Social 

2 Security Commissioner's denial of his application for disability insurance benefits. 

3 Plaintiff filed a motion for Summary Judgment. (Doc. No. 15.) The Commissioner filed 

4 a cross-motion for Summary Judgment. (Doc. No. 18.) On November 6, 2017, the 

5 Honorable Barbara L. Major issued a thoughtful and thorough Report and 

6 Recommendation ("Report") recommending that this Court grant Plaintiff's motion, deny 

7 the Commissioner's motion, and remand the case for further proceedings. (Doc. No. 21.) 

8 The Commissioner filed a timely motion for Reconsideration/Objection to the Report. 

9 (Doc. No. 22.) 

10 Where a party files a timely objection to a Report and Recommendation, the Court 

11 reviews de novo those portions of the report or specific proposed findings or 

12 recommendations to which an objection is filed. 28 U.S.C. § 636(b)(l). Having 

13 conducted a de novo review, the Court adopts the Report and Recommendation. 

14 BACKGROUND 

15 Plaintiff applied for Title II disability and disability insurance benefits claiming 

16 disability due to, among other impairments, post-traumatic stress disorder ("PTSD") and 

17 "chemical exposure" during operations in Saudi Arabia. Administrative Record (AR at 

18 39, 167, 191.)2 Plaintiff alleged the disability began on March 31, 2015 ("AOD"). (Id.) 

19 The claims were denied initially on August 4, 2015, and upon reconsideration on January 

20 7, 2016, resulting in Plaintiff's request for an administrative hearing on January 14, 2016. 

21 (AR at 106-109, 113, 119.) 

22 At the hearing before Administrative Law Judge Robin L. Henrie ("ALJ") on June 

23 9, 2016, Plaintiff and an impartial vocational expert, Victoria Ray, testified as to 

24 Plaintiff's alleged disability. (Id. at 36-74.) In a written decision dated August 24, 2016, 

25 the ALJ determined that Plaintiff was not disabled under section 216(i) and 223(d) of the 

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28 2 AR refers to the Administrative Record in case no. 3: 17-cv-00025 found at Doc. No. 10. 

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1 Social Security Act. (Id. at 21-31.) On November 9, 2016, the Appeals Council found 

2 no basis for reviewing the ALJ's ruling, and the ALJ's decision became the final decision 

3 of the Commissioner. (Id. at 1-3.) 

4 On January 6, 2017, Plaintiff filed this action seeking judicial review by the federal 

5 district court. (Id.) In his motion, Plaintiff argues that the ALJ's residual functional 

6 capacity ("RFC") finding was not supported by substantial evidence and was the product 

7 of legal error. (Pl.'s Mot. at 15.) In support of this contention, Plaintiff asserts four 

8 arguments. First, Plaintiff argues that the "ALJ ignored the opinion of a treating source, 

9 Dr. Vargas, and thereby fail[ed] to provide 'specific and legitimate' reasons for 

10 discounting the opinion ofa treating source." (Id. at 15.) Second, the "ALJ fail[ed] to 

11 account for moderate limitations in concentration, persistence, and pace by reducing 

12 Plaintiff's RFC to 'simple work', which thereby deprived the Step 5 determination of 

13 substantial evidence in support." (Id. at 20.) Third, the "ALJ's analysis of Plaintiff's 

14 100% Veterans Administration ("VA") disability rating fail[ed] to 'accurately reflect the 

15 approaches taken' in the Social Security Administration ("SSA") and VA disability 

16 systems." (Id. at 24.) And finally, the ALJ failed to provide clear and convincing 

17 reasons for discounting Plaintiff's testimony regarding his alleged limitations. (Id. at 26.) 

18 On November 6, 2017, Magistrate Judge Barbara L. Major issued a thoughtful and 

19 thorough Report. (Doc. No. 21.) 

20 STANDARD OF REVIEW 

21 An applicant may seek judicial review of a final agency decision pursuant to 42 

22 U.S.C. § 405(g), 1383(c)(3). An ALJ's decision will be reversed by the reviewing court 

23 only if"it is based upon legal error or is not supported by substantial evidence." Bayliss 

24 v. Barnhart, 427 F.3d 1211, 1214 n.1 (9th Cir. 2005) (citation omitted). "Substantial 

25 evidence means more than a mere scintilla but less than a preponderance; it is such 

26 relevant evidence as a reasonable mind might accept as adequate to support a 

27 conclusion." Andrews v. Shala/a, 53 F.3d 1035, 1039 (9th Cir. 1995). The Court must 

28 consider the record as a whole, weighing both the evidence that supports and detracts 

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from the ALJ's conclusion. See Mayes v. Massanari, 276 F.3d 453, 459 (9th Cir. 2001); 

Desrosiers v. Sec '.Y of Health & Human Servs., 846 F.2d 573, 576 (9th Cir. 1988). "The 

ALJ is responsible for determining credibility, resolving conflicts in medical testimony, 

and for resolving ambiguities." Andrews, 53 F.3d at 1039. Where the evidence is 

susceptible to more than one rational interpretation, the ALJ's decision must be upheld. 

(Id. at 1039-40.) The Court may not reverse an ALJ's decision on account of an error 

that is harmless. Molina v. Astrue, 674 F.3d 1104, 111 (9th Cir. 2012). 

DISCUSSION 

Plaintiff argues the ALJ erred by (1) ignoring the opinion of a treating source, Dr. 

Vargas, and thereby fail[ed] to provide 'specific and legitimate' reasons for discounting 

the opinion of a treating source"; (2) failed to account for moderate limitations in 

concentration, persistence and pace by reducing Plaintiffs RFC to 'simple' work, which 

thereby deprived the Step 5 determ~nation substantial evidence in support"; (3) the 

"ALJ's analysis of Plaintiffs 100% VA disability rating fail[ed] to 'accurately reflect the 

approaches taken' in the SSA and VA disability systems; and (4) failed to provide clear 

and convincing reasons for discounting Plaintiffs testimony regarding his alleged 

limitations. 

I. The ALJ Erred in Ignoring Dr. Vargas's Opinion 

Plaintiff assigns error to the ALJ' s evaluation for failing to provide legally 

sufficient reasons for ignoring Dr. Vargas's opinion while determining Plaintiffs RFC. 

Specifically, Plaintiff contends the "ALJ ignored the opinion of a treating source, Dr. 

Vargas, and thereby fail[ed] to provide 'specific and legitimate' reasons for discounting 

the opinion." (Pl.' s Mot. at 15.) 

In the Commissioner's cross-motion for Summary Judgment (Doc. No. 18) and 

Motion for Reconsideration (Doc. No. 22), it is alleged that while the ALJ did not 

explicitly reject Dr. Vargas's opinion, "the ALJ credited the State agency doctors who 

explicitly reviewed Dr. Vargas's opinion and determined that it was not supported by the 

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1 objective medical evidence of record." (Def.'s Mot. at 9.) Thus, the Commissioner 

2 contends the ALJ's decision should be upheld. 

3 The Court finds that the ALJ erred in ignoring Dr. Vargas's opinion. 

4 A. Failure to Mention Dr. Vargas's Opinion 

5 The ALJ's failure to mention Dr. Vargas's treatment records and opinion 

6 constitutes harmful error. Lester v. Chater, 81F.3d821, 830-31 (9th Cir. 1995). Ifa 

7 treating or examining physician's opinion is contradicted by another doctor's opinion, as 

8 here, an ALJ may only reject it by providing specific and legitimate reasons that are 

9 supported by substantial evidence. Bayliss v. Barnhart, 427 F.3d 1211, 1216 (9th Cir. 

10 2005). An ALJ meets this requirement by "'setting out a detailed and thorough summary 

11 of the facts and conflicting clinical evidence, stating his interpretation thereof, and 

12 making findings. The ALJ must do more than state conclusions. He must set forth his 

13 own interpretations and explain why they, rather than the doctors', are correct." Garrison 

14 v. Colvin, 759 F.3d 995, 1012 (9th Cir. 2014). 

15 In this case, the medical records most relevant to determining Plaintiffs disability 

16 status come from Dr. Vargas since she was his primary care physician.3 Dr. Vargas 

17 diagnosed several of Plaintiffs multiple health issues as well as provided follow-up care. 

18 She prescribed him multiple prescription medications and worked collaboratively with 

19 his psychiatrist, Dr. Emmit Lampkin. (Doc. No. 21 at 8-11.) She provided Plaintiff with 

20 "work excuse" letters and completed the necessary paperwork for his Family Medical 

21 Leave Act ("FMLA") leave. (AR at 348.) Moreover, Dr. Vargas's one-hundred 

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24 3 Dr. Vargas was Plaintiffs treating physician who diagnosed him with multiple medical 

conditions that were ongoing and severe. These included (1) General Anxiety Disorder; 

(2) Chronic PTSD; (3) Irritable Bowel Syndrome; ( 4) Elbow joint pain; (5) Knee pain; 

(6) Shoulder joint pain; (7) Insomnia; (8) Gastroesophageal reflux disease; (9) 

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27 Hematochezia; and (10) Chronic Colitis. (AR at 338-339, 348-349, 380, 406, 471.) Dr. 

Vargas prescribed PlaintiffTemazepam, Fluoxetine, Hyoscamine Sulfate, Trazodone, 28 Mesolamine, and Omeprazole. (See Id. at 354.) 

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1 ("l 00%") percent disabled finding due to PTSD is consistent with the VA and other 

2 examining physicians and providers findings as well. (Id. at 172-73.) 

3 Here, the ALJ failed to discuss Dr. Vargas's opinion or even mention that she 

4 treated the Plaintiff for over a year during the relevant time period. Report and 

5 Recommendation ("Report") at 17. In response, the Commissioner cited to the following 

6 perceived inconsistencies in the record to justify the ALJ's action: (1) treatment notes 

7 show normal findings during the same period that Dr. Vargas ... opined that Plaintiff 

8 could not bend, stoop, or lift (AR at 460); (2) despite Plaintiffs claim of severe colitis and 

9 gastrointestinal issues, medical evidence reflected his condition was under control4 (Id. at 

10 457); (3) in August 2015, Plaintiff only took Advil for the allegedly disabling physical 

11 pain instead of prescription pain medication (Id. at 4 7 4 ); ( 4) Plaintiff engaged in 60 to 90 

12 minutes of weightlifting and 25 minutes of cardio six times a week (Id. at 585); and (5) 

13 He traveled to Mexico to see his sons and participated in hiking activities despite his 

14 impairments. (Id. at 569.) 

15 Even assuming the aforementioned was correct, the ALJ failed to weigh, discuss, 

16 or evaluate the asserted inconsistencies with Dr. Vargas's opinion to provide "specific 

17 and legitimate reasons supported by substantial evidence in the record" to justify 

18 disregarding a treating physician's opinion. Orn v. Astrue, 495 F.3d 625, 632 (9th Cir. 

19 2007). 

20 Thus, on this record, the ALJ's reason for disregarding Dr. Vargas's opinion and 

21 treatment notes is not clear, convincing, or supported by substantial evidence. 

22 B. Failure to Give Any Deference or Weight to Dr. Vargas's Opinions 

23 The ALJ gave no weight to the medical opinion of Dr. Vargas while giving great 

24 weight to non-treating consulting State agency medical examiners, Dr. Doig and Dr. 

25 Masters. The medical examiners "explicitly reviewed Dr. Vargas's opinion and 

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4 On June 16, 2015, Nathaniel Ranney, M.D., reported that Plaintiff was "much 

improved" on medication (Id. at 457.) 

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1 determined that it was not supported by the objective medical evidence of record." 

2 (Def.'s Mot. at 9.) 

3 An ALJ is not a medical professional. Nguyen v. Chater, 172 F.3d 31, 35 (9th Cir. 

4 1999). While the ALJ has the duty to resolve conflicts in the medical evidence, the ALJ 

5 may not do so through speculation, or by substituting his opinion for that of a doctor. See 

6 Nguyen, 172 F.3d at 35. Agency regulations and rulings require weighing all opinions, 

7 "[r ]egardless of its source" (20 C.F .R. § 404.14527( c )), including the opinions of agency 

8 consultants (see SSR 96-6p (ALJ "may not ignore" opinions from state agency medical 

9 and psychological consultants)) and thereby erred in failing to evaluate this opinion. 

10 Sawyer v. Astrue, 303 F. App'x 453, 455 (9th Cir. 2008) (ALJ reversibly erred in failing 

11 to weigh SAMC opinions). Further, the ALJ is required to "give deference to and accord 

12 some weight to [Dr. Vargas's] opinion." Kinzer v. Colvin, 567 Fed. App'x 529, 530 (9th 

13 Cir. 2014) (finding that an ALJ erred in failing to give any deference to or accord any 

14 weight to a treating physician's opinion despite finding the opinion non-controlling). 5 

15 Here, the ALJ failed on both points when she refused to consider Dr. Vargas's 

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5 In assessing a disability claim, an ALJ may rely on medical "opinions of three 

types of physicians: (1) those who treat the claimant (treating physicians); (2) those who 

19 examine but do not treat the claimant (examining physicians); and (3) those who neither 

20 examine nor treat the claimant (non-examining physicians)." Lester v. Chafer, 81 F.3d 

821, 830 (9th Cir. 1995). It is the ALJ's responsibility to resolve conflicts in presented 

21 medical opinions. Carmickle v. Comm 'r, Soc. Sec. Admin., 533 F.3d 1155, 1164 (9th Cir. 

22 2008). In doing so, the Commissioner applies a hierarchy of deference to these three 

types of opinions. Lester, 81 F.3d at 830 (citation omitted). The medical opinion of a 

23 claimant's treating physician is given "controlling weight" ifit is "well-supported by 

24 medically acceptable clinical and laboratory diagnostic techniques and is not inconsistent 

with the other substantial evidence in [the claimant's] case record." 20 C.F.R. § 

25 404.1527(c)(2). When a treating physician's opinion is not controlling, it is weighted 

26 according to factors such as length of the treatment relationship and the frequency of 

examination, the nature and extent of the treatment relationship, supportability, 

27 consistency with the record, and specialization of the physician. (Id.§ 404.1527(c)(2)-

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1 opinion or accord it any weight, instead relying on State agency medical examiners 

2 findings to determine the Plaintiff's SSI disability eligibility. In this situation, the ALJ 

3 needed to identify the conflict between medical opinions and articulate specific and 

4 legitimate reasons for disregarding Dr. Vargas's opinion. 

5 Thus, the Court finds that the ALJ erred by failing to provide specific, legitimate 

6 reasons supported by substantial evidence for ignoring and failing to attribute any weight 

7 to Dr. Vargas's opinions. 

8 II. The ALJ Erred in Failing to Account for Moderate Limitations in 

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Concentration, Persistence, and Pace by Reducing Plaintiff's RFC to 'Simple' 

Work 

11 Plaintiff contends that the "ALJ fail[ ed] to account for moderate limitations in 

12 concentration, persistence, and pace by reducing Plaintiff's RFC to 'simple' work, which 

13 thereby deprived the Step Five determination of substantial evidence in support." (Id. at 

14 20.) The RFC reflects the most an individual can do. 20 C.F.R. §§ 404.1545, 416.945. 

15 In formulating an RFC, the ALJ considers all medically determinable impairments, 

16 including those that are not "severe," and evaluates "all of the relevant medical and other 

17 evidence," including the claimant's testimony. (Id.) An ALJ may rely on the testimony 

18 of a Vocational Expert ("VE") to determine whether a claimant retains the ability to 

19 perform past relevant work at Step Four, or other work in the national or regional 

20 economy at Step Five. Osenbrockv. Apfel, 240 F.3d 1157, 1162 (9th Cir. 2001). The 

21 ALJ is required to include only those limitations which are supported by substantial 

22 evidence in the hypothetical posed to a VE. See id. at 1163-65. "Conversely, an ALJ is 

23 not free to disregard properly supported limitations." Robbins v. Soc. Sec. Admin. 466 

24 F.3d 880, 886 (9th Cir. 2006). In other words, limitations supported by substantial 

25 evidence must be incorporated into the RFC and, by extension, the dispositive 

26 hypothetical question posed to the VE. Osenbrock, 240 F.3d at 1163-65. 

27 Here, Plaintiff argues the ALJ "erred [in failing to explicitly acknowledge Dr. 

28 Liss's opinion]" thereby preventing the only opinion in the record containing moderate 

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1 limitations in Concentration, Persistence, and Pace ("CPP") to be included in the RFC 

2 analysis. (Def.'s Mot. at 10-12.) As a result, the ALJ reduced moderate limitations on 

3 CPP to "simple" unskilled work in Plaintiff's RFC without any opinion evidence 

4 explicitly supporting her decision, thereby depriving the RFC and Step Five 

5 determination of substantial evidence in support. Brinkv. Comm 'r SSA, 343 Fed. App'x 

6 211, 212 (9th Cir. 2009).6 

7 The Commissioner concedes "the ALJ may have erred [in failing to explicitly 

8 acknowledge Dr. Liss's opinion]. However, because the "ALJ cited to substantial 

9 evidence in support of Plaintiff's RFC findings by citing to the treatment notes indicating 

10 benign mental status examination findings throughout the relevant period, any error is 

11 harmless as Dr. Liss's opinion supports the ALJ's decisions.7 (Def.'s Mot. at 10-12.) 

12 The Court disagrees. 

13 The ALJ's failure to properly consider Dr. Liss's opinion was not harmless 

14 because the opinion is directly relevant to the ultimate issue of whether Plaintiff can 

15 perform light work. Sawyer v. Astrue, 303 F. App'x 453, 455 (9th Cir. 2008). Moreover, 

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6 Dr. Liss opined that Plaintiff's anxiety disorders met the following criteria: (1) Plaintiff 

had "mild" restrictions of activities of daily living; (2) Plaintiff had "moderate" difficulty 

in maintaining social functioning; and (3) Plaintiff had "moderate" difficulty in 

maintaining concentration, persistence or pace." (Id.) Dr. Liss noted that "ADLs 

indicate limitations in CPP and social which are considered reasonable given MDis 

established in MER ... Overall, the totality of evidence indicates that claimant would be 

capable of simple work tasks with limited public contact." (Id. at 96.) Dr. Liss explained 22 that "[t]he claimant's mental condition is not currently of listing level severity but does 

impose moderate functional limitations." (Id. at 102.) Dr. Liss further opined that 

Plaintiff would "function best in work situations that preclude ongoing interaction with 

the public" and that Plaintiff"may exhibit variable difficulty in getting along with coworkers due to psychiatric sxs; therefore a work environment with low social stimulation 

is recommended." (Id. at 103.) 

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7 Defendant contends that although Dr. Liss found "moderate limitations in Plaintiff's 

ability to maintain concentration and attention for extended periods," ultimately he found 

that "Plaintiff could attend to and perform simple tasks for 2+ hours without special 

supervision." (Def.'s Mot. at 12.) 

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1 the inaccurate RFC prevented the vocational expert from identifying jobs that may be 

2 available to the Plaintiff. 

3 As such, because the ALJ failed to craft an RFC accounting for all of Plaintiff's 

4 limitations supported by substantial evidence in the record and the ALJ is directed to 

5 reevaluate this entire matter on remand. 

6 III. The ALJ Erred in the analysis of Plaintiff's 100% VA Disability Rating 

7 Third, Plaintiff contends the "ALJ' s analysis of Plaintiff's 100% VA disability 

8 rating fail[ed] to 'accurately reflect the approaches taken' in the SSA and VA disability 

9 systems." (Id. at 24.) Defendant argues the ALJ properly considered evidence of 

10 Plaintiff's VA disability rating "because the ALJ validly determined that the rating was 

11 not useful to the disability analysis because it was done in April 2014, nearly a year 

12 before Plaintiff even claimed he was disabled." (Id. at 14.) Defendant further argues that 

13 the VA "did not have the benefit of the full record of evidence, including treatment 

14 records, State agency doctor's opinions, Plaintiff's subsequent work history, activities of 

15 daily living, and the vocational expert testimony." (Id.) 

16 "[A]n ALJ must ordinarily give great weight to a VA determination of disability" 

17 because there is a "marked similarity between these two federal disability programs." 

18 McCartey v. Massanari, 298 F .3d 1072, 1076 (9th Cir. 2002); accord McLeod v. Astrue, 

19 640 F.3d 8812, 888 (9th Cir. 2011). However, because "VA and SSA criteria for 

20 determining disability are not identical ... the ALJ may give less weight to a VA 

21 disability rating if he gives persuasive, specific, valid reasons for doing so that are 

22 supported by the record." (Id.) 

23 On April 30, 2014, the VA rated Plaintiff 100% disabled due to his psychiatric 

24 disorder, Posttraumatic Stress Disorder ("PTSD"). (Pl. 's Mot. at 22-24.) In reaching this 

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determination, the VA found: 

Plaintiffs condition caused a persistent danger of hurting himself and others; 

difficulty in adapting to work and stressful circumstances; suicidal ideation 

and impaired impulse control; difficulty in adapting to a work like setting 

including establishing and maintaining effective work and social 

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relationships; mild memory loss; depressed mood; chronic sleep impairment; 

anxiety; and occupational and social impairment with occasional decrease in 

work efficiency and intermittent periods of inability to perform occupational 

tasks (although generally functioning satisfactorily, with routine behavior, 

self-care, and conversation normal). (AR at 172-73.) Specifically, the VA 

found that Plaintiff had a disability rating of 100% for PTSD and 3 0% for 

contact dermatitis and maculopapular rash. (Id. at 172-75.) 

Despite the VA's significant findings and 100% disabled rating for Plaintiff, the 

ALJ discounted the VA's disability determination arguing "[t]he criteria for the two 

separate disability programs have completely different standards for establishing 

disability." (Id. at 30.) "The VA rating of disability does not necessarily compel the 

undersigned to reach an identical result." (Id.) In fact, the Social Security 

Administration "uses a more 'rigorous standard' wherein the subjective complaints must 

be reasonably consistent with the objective medical findings." 

Here, although the ALJ did mention the VA's disability rating, she did not provide 

persuasive, specific, and valid reasons supported by the record for assigning "less 

weight" to the rating. To the extent the ALJ asserts that she assigned less weight to the 

VA disability rating because the criteria used by the VA is not the same as the one used 

by the Social Security Administration, this is not a valid reason to discount the VA's 

disability rating. (AR at 34.) When the ALJ gives less weight to a VA determination, as 

here, she shall provide "persuasive, specific, valid reasons for doing so that are supported 

by the record." McCartey v. Massanari, 298 F.3d 1072, 1076 (9th Cir. 2002). 

When the ALJ considered the VA's determination, she specifically accorded it 

little weight for two reasons: (1) because the VA disability standards differ from the SSI 

disability standards; and (2) because the VA did not have the benefit of more recent 

medical evidence before her. 8 (AR at 167-91.) 

27 8 The ALJ specifically pointed to "the opinions of the State agency medical and 

psychological consultants, evidence of the claimant's work history, and post-resignation 28 activities, and the input of the vocational expert" and then further pointed to other 

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1 In Valentine v. Comm 'r Soc. Sec. Admin., 574 F.3d 685, 695 (9th Cir. 2009), the 

2 court of appeals found that the ALJ ran afoul of McCartey insofar as she "distinguished 

3 the VA's disability rating on the general ground that the VA and SSA disability inquiries 

4 are different." So too here. The ALJ erred to the extent that she relied on the difference 

5 between the VA and SSA disability determinations. 

6 In Valentine, the court went on to find that "[t]he ALJ was justified in rejecting the 

7 VA's disability rating on the basis that she had evidence that the VA did not." (Id.) The 

8 ALJ there rejected the VA determination because it relied on a treating physician's 

9 opinion that the ALJ had properly rejected. Valentine held that this was a persuasive, 

10 specific, and valid reason supported by the record for according little weight to the VA 

11 determination. That is not the case here. Plaintiff filed a Title II application for disability 

12 and disability insurance benefits alleging disability beginning on March 31, 2015, due to 

13 his PTSD, among other illnesses, injuries and conditions. (See AR at 167-68.) Plaintiff 

14 concedes in his Motion that the VA rating was issued approximately eleven months prior 

15 to Plaintiffs resignation from his job at the U.S. Postal Service. (PL 's Mot. at 26.) 

16 However, Plaintiff further argues that the PTSD ultimately resulted in Plaintiffs 

17 resignation eleven months later, and the ALJ failed to set forth substantial evidence 

18 supporting her decision to discount the 100% VA rating merely because Plaintiff 

19 continued to work. (Id.) Neither the difference between the VA and SSA disability 

20 standards nor a discrepancy with a PTSD onset date because Plaintiff continued to work 

21 constitute a persuasive, specific, valid reason for discounting Plaintiffs VA 

22 determination, supported by the record. Thus, the ALJ erred in giving little weight to the 

23 VA determination. 

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27 contradicting opinion evidence (delineated in AR 28-29), Plaintiffs extensive daily 

activities (delineated in AR 28), and the VA's own progress notes after the disability 28 rating was issued (AR 29). 

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1 IV. The ALJ Erred in Discounting Plaintiff's Testimony Regarding His 

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Limitations 

Finally, Plaintiff contends that the ALJ failed to provide clear and convincing 

reasons for discounting Plaintiffs testimony regarding his alleged limitations. (Id. at 26.) 

In assessing a claimant's testimony regarding subjective pain or the intensity of 

symptoms, the ALJ engages in a "Two-Step" analysis. 20 C.F .R. § 404.1529, 416.929. 

The first stage is a threshold test in which the claimant must present objective medical 

evidence of an underlying impairment that could reasonably be expected to produce the 

symptoms alleged. Molina v. Astrue, 674 F.3d 1104, 1112 (9th Cir. 2012). At the second 

stage of the analysis, absent affirmative evidence of malingering, the ALJ must provide 

clear and convincing reasons for discrediting the claimant's testimony regarding the 

severity of the symptoms. Carmickle v. Comm 'r Soc. Sec. Admin., 533 F.3d 1155, 1166 

(9th Cir. 2008). 

The ALJ must make findings that are sufficiently specific to permit the reviewing 

court to conclude that the ALJ did not arbitrarily discredit the claimant's testimony. 

Ghanim v. Colvin, 763 F.3d 1154, 1163 (9th Cir. 2014). Factors the ALJ may consider 

when making such determinations include the objective medical evidence, the claimant's 

treatment history, the claimant's daily activities, and inconsistencies in the testimony. 

Ghanim, 763 F.3d 595 at 1163. In addition, conflicts between a claimant's testimony and 

the objective medical evidence in the record can undermine a claimant's credibility. 

Morgan v. Comm 'r Soc. Sec. Admin., 169 F.3d 595, 600 (9th Cir. 1999). 

When the ALJ's credibility findings are supported by substantial evidence in the 

record, the reviewing court "may not engage in second-guessing." Thomas v. Barnhart, 

278 F.3d 947, 959 (9th Cir. 2002). However, a general assertion that plaintiff is not 

credible is insufficient; the ALJ must "state which ... testimony is not credible and what 

evidence suggests the complaints are not credible." Dodrill v. Shalala, 12 F.3d 915, 918 

(9th Cir. 1993). 

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1 Here, neither party contests the ALJ's determination that Plaintiff has the 

2 following impairments: "post-traumatic stress disorder, generalized anxiety disorder, 

3 sleep apnea, right shoulder degenerative joint disease, and right knee degenerative joint 

4 disease." (AR at 22; see also Pl.'s Mot.; Def.'s Mot.) Because the ALJ concluded 

5 Plaintiffs "medically determinable impairments could reasonably be expected to cause 

6 the alleged symptoms," a finding which is not contested by either party, the first prong of 

7 the ALJ's inquiry regarding Plaintiffs subjective symptoms is satisfied. (See AR at 26.) 

8 Further, neither party alleges that the ALJ found that Plaintiff was malingering. (See 

9 Pl.'s Mot.; Def.'s Mot.) Thus, the Court must determine whether the ALJ provided clear 

10 and convincing reasons for discounting Plaintiffs subjective claims regarding his 

11 symptoms.9 See Lingerfelter v. Astrue, 504 F.3d 1028, 1036 (9th Cir. 2007). 

12 A. Activities of Daily Living 

13 Plaintiff argues that the ALJ erred in finding that his allegations about the severity 

14 of his impairments were inconsistent with his activities of daily living. (Pl.' s Mot. at 27.) 

15 Specifically, he asserts the ALJ incorrectly determined that Plaintiffs subjective 

16 complaints were "out of proportion with the record as a whole." (AR at 26.) 

17 Contradiction with a claimant's activities of daily living is a clear and convincing 

18 reason for rejecting a claimant's testimony. Tommasetti v. Astrue, 533 F.3d 1035, 1039 

19 (9th Cir. 2008). There are two grounds for using daily activities to form the basis of an 

20 adverse credibility determination: (1) when activities meet the threshold for transferable 

21 work skills and (2) when activities contradict a claimant's other testimony. Orn v. 

22 

23 

24 

25 

9 With regards to Plaintiffs claim that he is unable to "work full-time due to symptoms 

and limitations," the ALJ stated: The medical evidence in this case does not fully support 

the claimant's allegations to the extent alleged. Upon determining the residual functional 

26 capacity, the undersigned does not adopt all of the claimant's subjective allegations 

concerning the intensity, persistence, and limiting effects of symptoms mainly because 

they are out of proportion with the record as a whole, and therefore not consistent with 

28 the medical evidence. (AR at 27.) 

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1 Astrue, 495 F.3d 625, 639 (9th Cir. 2007). However, "disability claimants should not be 

2 penalized for attempting to lead normal lives in the face of their limitations," Reddick v. 

3 Chafer, 157 F.3d 715, 722, (9th Cir. 1998), and "the mere fact that a plaintiff has carried 

4 on with certain daily activities, such as grocery shopping ... does not in any way detract 

5 from his credibility," Webb v. Barnhart, 433 F.3d 683, 688 (9th Cir. 2005) (citing 

6 Vertigan v. Halter, 260 F.3d 1044, 1050 (9th Cir. 2001)). In order to impact a claimant's 

7 credibility, the activity has to be "inconsistent with claimant's claimed limitations." 

8 Reddick, 157 F.3d at 722. The ALJ cannot mischaracterize statements and documents in 

9 the record or take these out of context in order to reach his conclusion on the claimant's 

10 credibility. (Id. at 722-23.) 

11 Here, the ALJ contends Plaintiffs testimony is contradicted by the fact he 

12 performs certain daily activities that are inconsistent with the symptoms alleged. 

13 Specifically, Plaintiff testified that he painted his mother's house, worked on craft 

14 projects, hikes with the Canyoneers or by himself, traveled to Mexico, biked, lifted 

15 weights and reading. (AR at 28, 46, 560, 561, 568, 579.) The Commissioner argues 

16 these extensive activities of daily living clearly belie Plaintiffs claims of total disability 

17 and the R & R's findings that Plaintiff had extreme mental limitations. However, none of 

18 Plaintiffs activities is inconsistent with his claimed physical and mental limitations. 

19 Plaintiff can engage in all of the basic activities noted and still experience PTSD, anxiety, 

20 fatigue, and "serious memory deficit", particularly given that he testified his symptoms 

21 fluctuate, often unpredictably, from mild to severe. (AR 47-48, 66-67.) Thus, because 

22 Plaintiffs daily activities do not contradict his testimony, Plaintiffs level of activity is 

23 not a legitimate ground for discrediting his testimony. See, e.g., Vertigan v. Halter, 260 

24 F.3d 1044, 1050 (9th Cir. 2001). 

25 Nor are Plaintiffs daily activities indicative of transferable work skills such that 

26 they can be the basis of an adverse credibility determination. Under Ninth Circuit law, "if 

27 a claimant engages in numerous daily activities involving skills that could be transferred 

28 to the workplace, the ALJ may discredit the claimant's allegations upon making specific 

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1 findings relating to those activities." Burch v. Barnhart, 400 F.3d 676, 681 (9th Cir. 

2 2005). Here, there is no indication that Plaintiffs daily activities involve skills that are 

3 transferable to a work setting. Indeed, the ALJ makes no argument or specific findings 

4 on this point, and so the transferability of Plaintiffs daily activities is not a legitimate 

5 grounds for rejecting his testimony. 

6 The Court finds that this reason is not a clear and convincing reason supported by 

7 substantial evidence to discount Plaintiffs credibility. 

8 B. Conservative Treatment 

9 The ALJ also found that Plaintiff received "conservative treatment with prescribed 

10 medications for his medical conditions." (AR at 27.) Specifically, the Commissioner 

11 contends the ALJ was delineating what treatment regimen she found inconsistent with 

12 Plaintiffs allegedly disabling right knee and shoulder impairments which were treated 

13 with medication in place of more proactive measures. (AR at 26.) Moreover, the ALJ 

14 noted the successful treatment of Plaintiffs colitis using steroids in June 2015, as well as 

15 the treatment of his sleep apnea utilizing a CPAP device to further illustrate Plaintiffs 

16 history of successful conservative treatment. (AR at 27.) 

17 While the ALJ notes some of Plaintiffs physical improvements with conservative 

18 treatment, the ALJ fails to take into account all of Plaintiffs numerous medical issues by 

19 merely focusing on his physical impairments. A conservative course of treatment 

20 sometimes can justify the rejection of a claimant's testimony, at least where the testimony 

21 concerns only physical problems. See, e.g., Tommasetti, 533 F.3d at 1040; Meanel v. 

22 Apfel, 172 F.3d 1111, 1114 (9th Cir. 1999). However, Plaintiffs situation is far more 

23 complicated. 

24 Here, in addition to being treated for his physical impairments, from at least 

25 September 29, 2014, forward, Plaintiff has been under the continuous care of mental 

26 health professionals, including psychiatrists and psychiatric social workers. (AR at 399-

27 602.) This care has taken the form of frequent therapy sessions and the prescribing of 

28 antidepressant medications including Citalopram and Fluoxetine. (Id. at 349, 359, 380, 

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1 382, 401.) His medical records indicate that he has been compliant with his medication 

2 regimen of antidepressants, but still suffers from his PTSD and anxiety disorder. (See 

3 Report at 38-39.) Accordingly, the Court finds that without more, Plaintiffs treatment 

4 has not been "conservative" on these issues. 

5 The Court does not find that this is a clear and convincing reason supported by 

6 substantial evidence for discrediting Plaintiffs credibility. 

7 C. Personal Observation 

8 While an ALJ can include personal observations of a plaintiff during a hearing, a 

9 negative credibility determination based on those observations is proper only if it is 

10 supported by other evidence. See Garcia v. Astrue, 2013 WL 1797029, at *17 (S.D. Cal. 

11 Mar. 13, 2013) (citing Larsen v. Astrue, 2011WL3359676, at *9 (E.D. Cal. Aug. 3, 

12 2011); Nyman v. Heckler, 779 F.2d 528, 531 (9th Cir. 1986)). 

13 Here, the ALJ noted that "[Plaintiff] followed along and participated at the hearing 

14 in a sufficient manner." (AR at 24.) However, the ALJ failed to explain how Plaintiffs 

15 ability to participate in the administrative hearing related to his PTSD, anxiety disorder, 

16 and/or other medical impairments or undermined his testimony that he was not able to 

17 work. Nevertheless, the Commissioner asserts the ALJ did not cite to his personal 

18 observations of Plaintiff at the hearing when evaluating Plaintiffs symptoms, but in fact 

19 cited to the proper considerations and supported each with substantial evidence. (Report 

20 38; AR at 25-29, 53-54, 56-58.) The Commissioner's argument is unavailing. 

21 The ALJ's observation in this instance is less detailed than in those cases 

22 suggesting that personal observations can form a portion of the credibility analysis-it is 

23 not clear from the decision what it was about Plaintiffs demeanor that made him 

24 unpersuasive and on which issues he failed to persuade. Thus, while Plaintiffs demeanor 

25 can play some role in the credibility analysis, it is not, in this instance, a dispositive one. 

26 The Court does not find that this is a clear and convincing reason supported by 

27 substantial evidence for discrediting Plaintiffs credibility. 

28 /// 

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1 V. Remand Is Appropriate 

2 The decision ''whether to remand the case for additional evidence or simply to 

3 award benefits is within the discretion of the court." Stone v. Heckler, 761 F.2d 530, 533 

4 (9th Cir. 1985). Generally, "[w]hen an ALJ's denial of benefits is not supported by the 

5 record, 'the proper course, except in rare circumstances, is to remand to the agency for 

6 additional investigation or explanation."' Hill v. Astrue, 698 F.3d 1153, 1162 (9th Cir. 

7 2012), quoting Benecke v. Barnhart, 379 F.3d 587, 595 (9th Cir. 2004). 

8 Here, the ALJ erred when evaluating the medical opinion evidence. The ALJ's 

9 decision, therefore, is not supported by substantial evidence. In light of the 

10 aforementioned, this Court remands for further proceedings. 

11 CONCLUSION 

12 Having conducted a de novo review of the Report, the parties' cross-motions for 

13 summary judgment, Defendant's motion for reconsideration/objections to the Report, and 

14 relevant portions of the administrative record, the Court concludes that Judge Major's 

15 reasoning is sound. Therefore, the Court ADOPTS the Report. (Doc. No. 21.) See 28 

16 U.S.C. § 636(b)(l). Plaintiffs motion for Summary Judgment is GRANTED. (Doc. No. 

17 15.) Defendant's cross-motion for Summary Judgment and Motion for Reconsideration 

18 are DENIED. (Doc. Nos. 18-22.) Plaintiffs disability benefits application is 

19 REMANDED to the Social Security Administration for further proceedings consistent 

20 with this Order. 

21 IT IS SO ORDERED. 

~: DATED' M=h~18 24 

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