Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-3_06-cv-05422/USCOURTS-cand-3_06-cv-05422-5/pdf.json

Parties Involved:
Joanne B. Barnhart
Defendant
Beverly J. Stevenson
Plaintiff

Document Text:

United States District Court

For the Northern District of California

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1 On February 12, 2007, Michael J. Astrue became the Commissioner of Social

Security. Pursuant to Federal Rule of Civil Procedure 25(d)(1), Astrue is hereby substituted

in for Commissioner JoAnne B. Barnhart, who was the Commissioner at the time the suit

was filed. 

2 Defendant raises a factual attack on subject matter jurisdiction. Thus, the

Court may consider the Lovan declaration. See Thornhill Publ’n Co. v. General Tel. &

Elecs. Corp., 594 F.2d 730, 733 (9th Cir. 1979). 

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

BEVERLY J. STEVENSON,

Plaintiff,

 v.

MICHAEL J. ASTRUE,

Defendant. /

No. C 06-05422 JSW

ORDER GRANTING

DEFENDANT’S MOTION TO

DISMISS AND DENYING AS

MOOT PLAINTIFF’S MOTION

TO COMPEL DISCOVERY

INTRODUCTION

This matter comes before the Court upon consideration of the motion to dismiss filed by

Defendant Michael J. Astrue (“Defendant”).1 Also before the Court is the motion to compel

discovery filed by Plaintiff Beverly Stevenson (“Plaintiff”).

Having considered the parties’ arguments, relevant legal authority, and having had the

benefit of oral argument, the Court HEREBY GRANTS Defendant’s motion and DENIES AS

MOOT Plaintiff’s motion.

BACKGROUND

On August 9, 2005, Plaintiff filed an application for Disability Insurance and

Supplemental Social Security Income benefits. (See Declaration of Sharon Lovan ¶ 3.)2

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3 Although Plaintiff asserts the Declaratory Judgment Act and the

Administrative Procedure Act as bases for this Court’s subject matter jurisdiction, neither the

APA nor the Declaratory Judgment Act provide an independent basis for subject matter

jurisdiction. See Califano v. Sanders, 430 U.S. 99, 108 (1977) (“the APA does not afford an

implied grant of subject-matter jurisdiction permitting federal judicial review of agency

action”); Luttrell v. United States, 644 F.2d 1274, 1275 (9th Cir. 1980) (“28 U.S.C. §§ 2201

and 2202 create additional remedies in the form of declaratory judgment relief for federal

litigants, but do not in and of themselves confer subject matter jurisdiction on the courts.”).

2

Plaintiff’s application for benefits was denied, and on or about February 13, 2006, Plaintiff filed

a request for reconsideration of Defendant’s decision to deny her benefits. (Am. Compl. ¶ 3;

Lovan Decl. ¶¶ 4-5.) 

Plaintiff alleges that on or about May 10, 2006, she learned that Defendant stopped

working on her claim for reconsideration. (Am. Compl. ¶ 3.) Plaintiff also alleges that her

legal representative in the administrative proceedings “heard from the DDS claim examiner that

all reconsideration cases were on hold in California.” (Id.)

On September 1, 2006, Plaintiff filed this action as a Petition for Writ of Mandamus,

because she had not yet received a decision on her request for reconsideration. In her initial

petition, Plaintiff sought a writ compelling Defendant “to make a reconsideration

determination” on her application for Social Security benefits “within a ‘reasonable time.’” (See

Docket No. 1, Pet. at 1.)

While this action was pending, on November 9, 2006, Plaintiff’s request for

reconsideration was denied. On December 4, 2006, Plaintiff requested a hearing before an

Administrative Law Judge (“ALJ”). (Lovan Decl. ¶¶ 7-8.) On December 26, 2006, Defendant

filed a motion to dismiss the petition on the ground that the case was moot, because Plaintiff

had received a reconsideration decision. Defendant also moved to dismiss on the ground that

the Court lacked jurisdiction, because Plaintiff had not yet exhausted administrative remedies. 

(See Docket No. 7.) 

In response, on January 9, 2007, Plaintiff filed her Amended Complaint, which is the

operative pleading in this action. In her Amended Complaint, Plaintiff asserts that the Court has

jurisdiction pursuant to 28 U.S.C. § 1331, 28 U.S.C. § 1361, 5 U.S.C. § 704, 28 U.S.C. §§ 2201,

2202, and 42 U.S.C. § 405(g).3

 (Am. Compl. ¶ 1.) 

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3

Plaintiff alleges that: (1) Defendant violated her procedural due process rights by failing

to process her claim for benefits without undue delay; (2) Defendant placed an improper hold

on her request for reconsideration of the denial of benefits; (3) Defendant failed to properly

administer reconsideration level processing; and (4) Defendant unduly delayed in administering

all steps to exhaustion of Plaintiff’s administrative remedies. (See id. ¶¶ 2-3.) 

On March 30, 2007, while Defendant’s motion was pending, an ALJ issued a decision in

which he granted Plaintiff’s application for benefits but determined that prior applications

would not be reopened. (See Declaration of Andrew Ragnes, Ex. I.) Plaintiff has not yet

appealed that decision to the Appeals Council.

At the hearing, Plaintiff clarified that she alleges Defendant unduly delayed in the

processing of her application for benefits at the reconsideration stage and failed to follow the

proper procedures in making this determination. Plaintiff stated that she asks the Court to

review the administrative process to date and, if an error is found, order Defendant to administer

her claim properly. 

ANALYSIS

A. Legal Standards on Motions to Dismiss.

Defendant moves to dismiss Plaintiff’s complaint under Federal Rule of Civil Procedure

12(b)(1), on the ground that the Court lacks subject matter jurisdiction over the claims, and also

under Rule 12(b)(6), on the ground that Plaintiff fails to state a claim.

A motion to dismiss for lack of subject matter jurisdiction under Rule 12(b)(1) may be

“facial or factual.” Safe Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004.) Where

an attack on jurisdiction is a “facial” attack on the allegations of the complaint, the factual

allegations of the complaint are taken as true and the non-moving party is entitled to have those

facts construed in the light most favorable to him or her. Federation of African Amer.

Contractors v. City of Oakland, 96 F.3d 1204, 1207 (9th Cir. 1996). If the jurisdictional attack

is “factual,” a defendant may rely on affidavits or other evidence that would be properly before

the Court, and the non-moving party is not entitled to any presumptions of truthfulness with

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respect to the allegations in the complaint. Rather, he or she must come forward with evidence

establishing jurisdiction. Thornhill, 594 F.2d at 733. 

A motion to dismiss is proper under Rule 12(b)(6) where the pleadings fail to state a

claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). A motion to dismiss should

not be granted unless it appears beyond a doubt that a plaintiff can show no set of facts

supporting his or her claim. Conley v. Gibson, 355 U.S. 41, 45-46 (1957); see also De La Cruz

v. Tormey, 582 F.2d 45, 48 (9th Cir. 1978). In ruling on a Rule 12(b)(6) motion, the complaint is

construed in the light most favorable to the non-moving party and all material allegations in the

complaint are taken to be true. Sanders v. Kennedy, 794 F.2d 478, 481 (9th Cir. 1986). The

court, however, is not required to accept legal conclusions cast in the form of factual allegations

if those conclusions cannot reasonably be drawn from the facts alleged. Clegg v. Cult

Awareness Network, 18 F.3d 752, 754-55 (9th Cir. 1994) (citing Papasan v. Allain, 478 U.S.

265, 286 (1986)). 

As a general rule, “a district court may not consider any material beyond the pleadings

in ruling on a Rule 12(b)(6) motion.” Branch v. Tunnell, 14 F.3d 449, 453 (9th Cir. 1994),

overruled on other grounds, Galbraith v. County of Santa Clara, 307 F.3d 1119, 1125 (9th Cir.

2002) (citation omitted). However, a district court may consider documents attached to a

plaintiff's complaint without converting a motion to dismiss into a motion for summary

judgment. Hal Roach Studios, Inc. v. Richmond & Feiner Co., Inc., 896 F.2d 1542, 1555 n.19

(9th Cir. 1989). Similarly, a court may consider documents referenced in, but not attached to a

complaint, where no party questions their authenticity, without converting a motion to dismiss

into a motion for summary judgment. Branch, 14 F.3d at 453-54.

B. Administrative Procedures Regarding Applications for Social Security Benefits.

The Social Security Act and regulations promulgated thereunder “create an orderly

administrative mechanism, with district court review of the final decision of the Secretary.” 

Califano, 430 U.S. at 102. This “orderly administrative mechanism,” is begun when a person

seeking benefits files a claim and receives an initial determination. See 20 C.F.R. §§

404.900(a)(1), 404.905. If an applicant is dissatisfied with the initial determination, he or she

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may seek a reconsideration of that decision. See id. §§ 404.900(a)(2), 404.907-404.909. If the

applicant is dissatisfied with the decision on reconsideration, he or she may request a hearing

before an ALJ. See id. §§ 404.900(a)(3), 404.907, 404.930. If an applicant is not satisfied with

the decision of the ALJ, he or she may ask the Appeals Council to review the decision. See id.

§§ 404.900(a)(4), 404.955, 404.967. Thereafter, an applicant may seek judicial review if he or

she is dissatisfied with the Appeals Council’s decision. See 42 U.S.C. § 405(g) (“Section

405(g)”). 

Section 405(g) provides in pertinent part, “[a]ny individual, after any final decision of

the Commissioner of Social Security made after a hearing to which he was a party, ... may

obtain a review of such decision by a civil action commenced within sixty days after the

mailing to him of notice of such a decision or within such further time as the Commissioner of

Social Security may allow.”

42 U.S.C. § 405(h), provides that: 

[t]he findings and decisions of the Secretary after a hearing shall be

binding upon all individuals who were parties to such hearing. No

findings of fact or decision of the Secretary shall be reviewed by any

person, tribunal, or governmental agency except as provided herein. 

No action against the United States, the Secretary, or any officer or

employee thereof shall be brought under Section 1331 or 1346 of Title

28 to recover on any claim arising under this subchapter. 

42 U.S.C. § 405(h) (emphasis added).

Pursuant to these provisions of the Social Security Act, before seeking judicial review

under of her claims under the Social Security Act, Plaintiff must obtain a final judgment from

Defendant. Johnson v. Shalala, 2 F.3d 918, 921 (9th Cir. 1993.) “A final judgment consists of

two elements: the presentment of a claim to the [Commissioner] and the exhaustion of

administrative remedies. The presentment requirement is jurisdictional and cannot be waived

by the [Commissioner] or the courts.” Id. However, the exhaustion requirement may be waived

in certain circumstances. Id.

//

//

// 

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28 4 Although the court in Kaiser was addressing Medicare, Sections 405(g) and

405(h) apply to review of Medicare determinations as well. See Kaiser, 347 F.3d at 1111.

6

C. The Court Lacks Jurisdiction Over Plaintiff’s Claims Under the Social Security

Act.

With the exception of Plaintiff’s claim for mandamus, Defendant argues that the Social

Security Act provides the exclusive basis for subject matter jurisdiction over Plaintiff’s claims

because they arise under the Social Security Act. The Court agrees. The Supreme Court has

interpreted the term “arising under,” as used in Section 405(h), to require that “virtually all legal

attacks” be channeled through the administrative process. See Shalala v. Ill. Council on Long

Term Care, 529 U.S. 1, 13 (2000); Heckler v. Ringer, 466 U.S. 602 (1984) (“Ringer”;

Weinberger v. Salfi, 422 U.S. 749 (1975). 

In Weinberger, the plaintiffs challenged the application of certain eligibility

requirements, which the defendant relied on to deny the plaintiffs’ applications for benefits. 

The plaintiffs asserted that the eligibility requirements were unconstitutional and that, therefore,

the court had jurisdiction under 28 U.S.C. § 1331. Weinberger, 422 U.S. at 755. Although the

Supreme Court stated that “[i]t would ... be fruitless to contend that [plaintiffs’] claim is one

which does not arise under the Constitution, since their constitutional arguments are critical to

their complaint[,] ... it is just as fruitless to argue that this action does not also arise under the

Social Security Act. For not only is it Social Security benefits which [plaintiffs] seek to

recover, but it is the Social Security Act which provides both the standing and the substantive

basis for the presentation of their constitutional contentions.” Id. at 760. Accordingly, the

Court held that the district court did not have jurisdiction under 28 U.S.C. § 1331 and held that

the plaintiffs were required to exhaust their claim through the administrative process. Id. at

763-67. 

The Ninth Circuit, following Weinberger and its progeny, has articulated two tests “to

determine whether claims arise under” the Social Security Act. See Kaiser v. Blue Cross of

California, 347 F.3d 1107, 1112 (9th Cir. 2003).4

 The first test examines whether the claims are

“‘inextricably intertwined’ with a [Social Security] benefits determination.” If so, they arise

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under the Social Security Act. Id. The second test examines whether the claims are such that

“‘both the standing and the substantive basis for the presentation’ of the claims” is the Social

Security Act. Again, if the answer to that question is yes, the claims “arise under” the act. Id.;

cf. Telecare Corp. v. Leavitt, 409 F.3d 1345, 1349 (9th Cir. 2005) (finding that a cause of action

will arise under Medicare if specialized administrative and judicial review processes provided

for by statute are available to plaintiff). 

Although Plaintiff’s claim of a procedural due process violation arguably “arises under”

the Constitution, much like the plaintiffs’ claim “arose under” the Constitution in Weinberger,

Plaintiff candidly admitted at the hearing that the crux of her complaint is with irregularities in

the processing of her individual claim for benefits and that she seeks to remedy that allegedly

flawed process as it applied to her. Thus, the Court concludes that the allegations in the

Amended Complaint are inextricably intertwined with the determination of her claim for

benefits, and further concludes that the Social Security Act provides the standing and

substantive basis for presenting the claims to this Court. 

Accordingly, with the exception of her claim for mandamus relief, Plaintiff’s claims

“arise under” the Social Security Act. Therefore, the exhaustion requirements of Section 405(g)

apply. 

1. Plaintiff Is Not Entitled to Waiver of the Exhaustion Requirements.

Defendant argues that the Court must dismiss this case for lack of jurisdiction because

Plaintiff has not exhausted her claims and because the exhaustion requirement should not be

waived. As noted, in order to obtain a final judgment from Defendant, Plaintiff must present

her claim and exhaust the administrative process. It is undisputed that Plaintiff has presented

her application for benefits to Defendant. It also is undisputed that Plaintiff has not yet

appealed the ALJ’s March 30, 2007 decision to the Appeals Council and, thus, has not

exhausted administrative remedies. Therefore, unless she establishes that exhaustion should be

waived, the Court must dismiss her case. 

In order to establish that exhaustion of administrative remedies should be waived,

Plaintiff must show her claim is “(1) collateral to a substantive claim of entitlement

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(collaterality), (2) colorable in its showing that refusal to denial of relief will cause irreparable

harm (irreparability), and (3) one whose resolution would not serve the purposes of exhaustion

(futility).” Johnson, 2 F.3d at 921 (citing Briggs v. Sullivan, 886 F.2d 1132, 1139 (9th Cir.

1989)). The Court concludes that Plaintiff has not established the collaterality and futility

prongs of this test.

“A plaintiff’s claim is collateral is if it is not essentially a claim for benefits.” Johnson,

2 F.3d at 921 (citing Bowen v. City of New York, 476 U.S. 467, 483 (1985)). In Ringer, supra,

the plaintiffs challenged a policy by which the Secretary denied benefits for a certain medical

procedure. Although the Court focused on the basis on which subject matter jurisdiction

existed, the Court also found that the plaintiffs’ claim was “at bottom” a claim for benefits, and

thus not collateral, because they asked the Secretary to change her policy so that they might

avoid the administrative process. Ringer, 466 U.S. at 415. 

Similarly, in Kildare v. Saenz, 325 F.3d 1078 (9th Cir. 2003), the plaintiffs alleged that

state officials charged with administering Social Security determinations systematically

disregarded federal regulations and alleged that federal officials failed to exercise adequate

oversight over the state officials. Kildare, 325 F.3d at 1080. The court concluded that although

the plaintiffs “use[d] terms such as ‘policy,’ ‘practice,’ and ‘systematic,’ throughout their

Complaint, ...” the artful use of those terms did not change the fact that all plaintiffs alleged was

“a series of claimed irregularities in individual cases that is entirely dependant on the

[plaintiffs’] underlying claim for benefits and the proceedings before the State Defendants in

making the initial disability determination.” Id. at 1083.

In contrast, in City of New York, the plaintiffs challenged a policy implemented by the

Social Security Administration which mandated a presumption that applicants for benefits who

were mentally disabled were qualified to do unskilled work. City of New York, 467 U.S. at 473-

74. The Supreme Court concluded that because the plaintiffs challenged the Secretary’s failure

to follow applicable regulations, and did not seek or obtain an award for benefits in the district

court, the claim was collateral. Id. 

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Similarly, in Johnson, the Ninth Circuit held that the plaintiffs’ challenge to the

Secretary’s policy of treating in-kind loans as income was collateral to their claim for benefits,

because the plaintiffs sought to invalidate the rule. Id. The Ninth Circuit distinguished Ringer

in the Johnson case, noting that “the plaintiff’s attack is essentially to the policy itself, not to its

application to them, nor to the ultimate substantive determination of their benefits. Their

challenge to the policy rises and falls on its own, separate from the merits of their claim for

benefits.” 2 F.3d at 921-22 (citing Johnson v. Sullivan, 922 F.2d 346, 353 (7th Cir. 1990)). The

Johnson court summarized its conclusion that the plaintiffs’ claim was collateral by stating that

“it is not ‘bound up with the merits so closely that [the court’s] decision would constitute

interference with agency process.’” Id. at 922 (quoting Johnson, 922 F.3d at 353 (in turn

quoting Weinberger, 422 U.S. at 765)).

The Court finds this case to be more like the Ringer and Kildare cases than the City of

New York or Johnson cases. Superficially, Plaintiff challenges a practice or policy that resulted

in a delay in the administrative process. At bottom, however, Plaintiff’s attack is not on this

policy itself, but upon its application to her. Further, to the extent Plaintiff asks this Court to

“expedite” the administrative process or to circumvent it altogether, that decision would

interfere with established agency process. Accordingly, the Court concludes Plaintiff’s claim is

not collateral to her claim for benefits.

The Court also concludes that the purposes of exhaustion would be served in this case

and, thus, Plaintiff has not established the futility prong. In City of New York, the Supreme

Court stated that the “ultimate decision of whether to waive exhaustion should ... be guided by

the policies underlying the exhaustion requirement.” City of New York, 476 U.S. at 484. In

general, those policies are that exhaustion permits the agency to develop a complete factual

record and to apply its own expertise. Johnson, 2 F.3d at 922.

The procedural history of this case demonstrates the general importance of the

exhaustion and supports the Court’s conclusion that the purposes underlying the exhaustion

requirement will be served. Although Plaintiff at first claimed the only irregularity in her case

was the alleged delay in obtaining a reconsideration decision, she now asserts that there are

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5 The Court notes that the Supreme Court’s decision in Heckler v. Day, 467

U.S. 104 (1984) provides some support for Plaintiff’s claim that this Court should review

whether or not there has been undue delay in her case. In Day, the district court issued an

injunction that imposed mandatory deadlines on the Social Security Administration with

respect to the time frame in which applications were processed. The Supreme Court

reversed. Although it noted there was no challenge to the district court’s findings regarding

unreasonable delay in the processing of the plaintiffs’ applications, it noted the tension

between delays in the process and the need to provide quality decision making. Day, 467

U.S. at 111-112. That tension is apparent in this case, because Plaintiff appears to claim that

the ALJ engaged in shortcuts, resulting in the allegedly flawed March 30, 2007 decision.

In Day, the Supreme Court concluded that if Congress was aware of these two

competing concerns and chose not to impose mandatory deadlines on the process, it would

be inappropriate for the courts to impose such deadlines. Id. at 119. The Supreme Court did

note, however, that its decision was not intended to preclude relief for undue delays in

individual cases. Id. at n. 33. A key distinction between the instant case and the Day case is

that, in Day, the Supreme Court concluded that the defendant had waived any argument with

respect to exhaustion and, thus, was not required to address whether the exhaustion

requirement should be waived. It may be that if Plaintiff exhausts the administrative process,

seeks judicial review, and maintains her claim that Defendants unduly delayed, the Court can

provide a remedy by setting some time limits upon remand. The Court concludes, however,

that it cannot provide that relief at this time because she has obtained reconsideration, and

thus the Court cannot direct the Defendant to render that decision in a specific time period. 

Furthermore, it would be speculative to conclude that there will be further delays in the

administrative process. 

10

flaws in the ALJ’s decision making process. However, while Plaintiff concedes that these are

matters which can be addressed by the Appeals Council, she admits that she wants the Court to

allow her to circumvent that step of administrative review because of potential delays. 

Although this might support her claim for mandamus, it does not support a conclusion that

exhaustion of administrative remedies should be waived. See Kildare, 325 F.3d at 1084

(concluding plaintiffs had not established futility because alleged errors in administrative

process “must be determined in the context of individual disability proceedings and require

development of individual factual records”). 

Accordingly, the Court GRANTS Defendant’s motion to dismiss the complaint on the

ground that the Court lacks jurisdiction because Plaintiff has not exhausted her administrative

remedies.5

D. Plaintiff’s Claim for Mandamus Relief Is Dismissed.

Defendant concedes the Court would have jurisdiction over Plaintiff’s complaint under

28 U.S.C. § 1361, but argues that Plaintiff cannot meet the standards necessary for mandamus

review. “Mandamus is an extraordinary remedy and is available to compel a federal official to

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perform a duty only if: “(1) the individual’s claim is clear and certain; (2) the official’s duty is

nondiscretionary, ministerial, and so plainly prescribed as to be free from doubt; and (3) no

other adequate remedy is available.” Kildare, 325 F.3d at 1084. The Court concludes that

Plaintiff cannot establish that mandamus review is appropriate because to the extent she

complains of errors in the process, those errors could be corrected upon administrative review. 

Id. at 1085. Moreover, at this stage, the Court concludes that it would be speculative to

conclude that there will, in fact, be further delays in the process.

CONCLUSION

For the foregoing reasons, Plaintiff’s Amended Complaint is dismissed without

prejudice.

IT IS SO ORDERED.

Dated: May 1, 2007 

JEFFREY S. WHITE

UNITED STATES DISTRICT JUDGE

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