IN THE UNITED STATES DISTRICT COURT 

FOR THE DISTRICT OF OREGON 

NICHOLAS GRAY, 

Plaintiff, 

v. 

CAROLYN W. COLVIN, 

Conunissioner, Social Security 

Administration, 

Defendant. 

RICHARD F. MCGINTY 

McGinty & Belcher, PC 

P.O. Box 12806 

Salem, OR 97309 

(503) 371-9636 

Attorneys for Plaintiff 

BILLY J. WILLIAMS 

United States Attorney 

JANICE E. HEBERT 

Assistant United States Attorney 

1000 S.W. Third Avenue, Suite 600 

Portland, OR 97204-2902 

(503) 727-1011 

1 - OPINION AND ORDER 

6:15-cv-00647-BR 

OPINION AND ORDER 

Case 6:15-cv-00647-BR Document 25 Filed 10/04/16 Page 1 of 11
DAVID MORADO 

Regional Chief Counsel 

JEFFREY E. STAPLES 

Special Assistant United States Attorney 

Social Security Administration 

701 Fifth Avenue, Suite 2900 

Seattle, WA 98104 

(206) 615-3706 

Attorneys for Defendant 

BROWN, Judge. 

This matter comes before the Court on Plaintiff's Motion 

(#21) for Equal Access to Justice Act (EAJA) Fees and Costs 1 in 

which he seeks an award of attorneys' fees pursuant to 28 U.S.C. 

§ 2412. 

For the reasons that follow, the Court DENIES Plaintiff's 

request for EAJA fees. 

BACKGROUND 

Plaintiff filed his application for DIB on September 25, 

2011, and alleged a disability onset date of January 5, 2010. 

His application was denied initially and on reconsideration. An 

Administrative Law Judge (ALJ) held a hearing on December 12, 

2013. 

The ALJ issued a decision on December 20, 2013, in which he 

found Plaintiff is not entitled to benefits. That decision 

1 Plaintiff does not claim any costs or expenses in his 

Motion. 

2 - OPINION AND ORDER 

Case 6:15-cv-00647-BR Document 25 Filed 10/04/16 Page 2 of 11
became the final decision of the Commissioner on February 27, 

2015, when the Appeals .Council denied Plaintiff's request for 

review. 

Plaintiff appealed the decision of the Commissioner to this 

Court. This Court reviewed the Commissioner's denial of 

benefits, and, after reviewing the record, the Court issued its 

Opinion and Order (#19) on June 13, 2016, reversing the decision 

of the Commissioner and remanding the matter pursuant to sentence 

four of 42 U.S.C. § 405(g) for further administrative 

proceedings. 

On August 25, 2016, Plaintiff filed this Motion (#21) for 

EAJA Fees. Plaintiff seeks an award of attorneys' fees in the 

amount of $7,121.87. 

STANDARDS 

Under EAJA the Court may award attorneys' fees and costs to 

a plaintiff's attorney in an action against the United States or 

any agency or official of the United States if (1) the plaintiff 

is the prevailing party, (2) the Commissioner has not met her 

burden to show that her positions during the case were 

substantially justified or that special circumstances make such 

an award unjust, and (3) the requested attorneys' fees and costs 

are reasonable. 28 U.S.C. § 2412 (d) (1) (A). See also PerezArellano v. Smith, 279 F.3d 791, 792 (9th Cir. 2002). 

3 - OPINION AND ORDER 

Case 6:15-cv-00647-BR Document 25 Filed 10/04/16 Page 3 of 11
A ''prevailing party'' is one who has been awarded relief by 

the court on the merits of at least some of his claims. Hanrahan 

v. Hampton, 446 U.S. 754, 758 (1980). "Enforceable judgments and 

court-ordered consent decrees create 'the material alteration of 

the legal relationship of the parties' necessary to permit an 

award of attorney's fees." Buckhannon Bd. and Care Home, Inc. v. 

W. Va. Dep't of Health and Human Res., 532 U.S. 598, 604 

(2001) (internal citation omitted). 

A prevailing plaintiff is not entitled to attorneys' fees 

under EAJA when the Commissioner's positions were substantially 

justified. Lewis v. Barnhart, 281 F.3d 1081, 1083 (9th Cir. 

2002). The Commissioner's positions are substantially justified 

if they are reasonably based both in law and fact. Id. (citing 

Pierce v. Underwood, 487 US. 552, 566 n.2 (1988)). The 

Commissioner's failure to prevail on the merits of his positions 

does not raise a presumption of unreasonableness. U.S. v. 

Marolf, 277 F. 3d 1156, 1162 (9th Cir. 2002) (citing Kali v. Bowen, 

854 F. 2d 329, 332 (9th Cir. 1988)). 

When the Commissioner opposes a claimant's fee request, she 

bears the burden to establish her positions at each stage of the 

proceeding were "substantially justified." Corbin v. Apfel, 149 

F.3d 1051, 1053 (9th Cir. 1998). See also U.S. v. Real Property 

at 2659 Roundhill Drive, Alamo, Ca., 283 F.3d 1146, 1151 (9th 

Cir. 2002). To prevail, therefore, the Commissioner must 

4 - OPINION AND ORDER 

Case 6:15-cv-00647-BR Document 25 Filed 10/04/16 Page 4 of 11
establish the positions taken by the Commissioner in opposition 

to the claimant's efforts to obtain Social Security benefits both 

in the proceedings before this Court and in the underlying 

administrative action were substantially justified. See Lewis, 

281 F.3d at 1085-86. 

The Commissioner's position "'must be justified in substance 

or in the main,' - that is, justified to a degree that could 

satisfy a reasonable person." Gonzales, 408 F.3d at 618 (citing 

Pierce v. Underwood, 487 U.S. 552, 565 (1988)). "Put another 

way, substantially justified means there is a dispute over 

which 'reasonable minds could differ.'" Gonzales, 408 F.3d at 

618 (citing League of Women Voters of Cal. v. FCC, 798 F.2d 1255, 

1257 (9th Cir. 1986)). 

DISCUSSION 

This Court found the ALJ erred when he (1) excluded 

Plaintiff from the hearing during his wife's testimony, 

(2) failed to ask the VE whether his testimony was consistent 

with the DOT, and (3) made inconsistent findings in his 

"paragraph B" analysis at Step Three and in his assessment of 

Plaintiff's Residual Function Capacity (RFC). The Court 

concluded the first two errors were harmless. The Court, 

however, concluded the third error required remand for further 

clarification by the ALJ. 

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Case 6:15-cv-00647-BR Document 25 Filed 10/04/16 Page 5 of 11
Plaintiff argues in his Reply' that he is entitled to 

attorneys' fees because the Commissioner's position was not 

substantially justified either at the administrative hearing or 

on review by this Court. 

I. The ALJ's error in excluding Plaintiff from the hearing when 

his wife testified. 

Plaintiff contends the ALJ's failure to comply with agency 

rules and regulations was not reasonable, and, therefore, the 

Commissioner's position was not substantially justified. 

As noted in the Court's Opinion and Order (#19) on June 13, 

2016, the Court concluded Plaintiff's exclusion from the 

administrative hearing was harmless error because it "was 

inconsequential to the ultimate nondisability determination by 

the ALJ.n Opin. and Order (#19) at 12. 

Plaintiff contends the ALJ failed to follow procedures set 

forth in the Hearings, Appeals and Litigation Law Manual (HALLEX) 

when he excluded Plaintiff from the hearing during his wife's 

testimony. Pl.'s Reply at 2. Plaintiff relies on Gutierrez v. 

Barnhart, 274 F.3d 1255 (9th Cir. 2001), to support his position 

that the ALJ's failure to follow the HALLEX procedure was not 

reasonable. 

In Gutierrez the Ninth Circuit held the ALJ's failure to 

2 In his Motion Plaintiff did not assert any bases for his 

requested fees other than he "is entitled to a reasonable 

attorney fee under EAJA . . upon proper presentation to the 

Court." 

6 - OPINION AND ORDER 

Case 6:15-cv-00647-BR Document 25 Filed 10/04/16 Page 6 of 11
complete a specific form for the evaluation of mental impairments 

and the failure to attach it to his decision as required by 

regulations was not reasonable. Id. at 1261. The regulation 

stated the form "must be completed" and "will be appended to the 

decision." 20 C.F.R. § 404.1520a(d). According to the Guiterrez 

court, there is not any ambiguity as to the requirements of this 

regulation, and, therefore, the failure to comply was not 

reasonable and the Commissioner's position was not substantially 

justified. 

In contrast, the purpose of the HALLEX manual is stated in 

Chapter I-1-0-1 as follows: 

Through HALLEX, the Deputy Commissioner for 

Disability Adjudication and Review conveys guiding 

principles, procedural guidance, and information 

to Office of Disability Adjudication and Review 

staff. HALLEX defines procedures for carrying out 

policy and provides guidance for processing and 

adjudicating claims at the hearing, Appeals 

Council, and civil action levels. 

In Moore v. Apfel the Ninth Circuit noted the HALLEX manual 

"does not provide substantive rules." 216 F.3d 864, 868 (9th 

Cir. 2000). Instead it "is strictly an internal guidance tool, 

providing policy and procedural guidelines to ALJs." The court 

also held HALLEX "does not have the force and effect of law [and] 

. is not binding on the Commissioner." Id. at 868-69. The 

court, therefore, refused to review allegations of noncompliance 

with the manual. See also Lockwood v. Comm'r. Soc. Sec. Admin., 

616 F.3d 1068, 1072 (9th Cir. 2010). Thus, the Court concludes 

7 - OPINION AND ORDER 

Case 6:15-cv-00647-BR Document 25 Filed 10/04/16 Page 7 of 11
on this record that the requirements of the HALLEX manual are not 

regulations "requiredn to be followed by the ALJ, and, therefore, 

the ALJ's error was harmless. 

Accordingly, the Court concludes the ALJ's exclusion of 

Plaintiff from the hearing during his wife's testimony was was 

not unreasonable or unjustified. 

II. The ALJ's error in failing to ask the VE whether his 

testimony was consistent with the DOT. 

The Court found the ALJ erred when he failed to ask the VE 

whether his opinion was consistent with the DOT, but the Court 

concluded the error was harmless because the VE and ALJ 

adequately explained the only possible inconsistency with the 

DOT. Opin. and Order (#19) at 16. 

Plaintiff asserts Social Security Regulations impose "an 

affirmative responsibility to ask about any possible conflict 

between the VE . . evidence and information provided in the 

DOT.n SSR 00-4p. Plaintiff contends the ALJ's failure to comply 

with this regulation was not reasonable, and, therefore, the 

Commissioner's position was not substantially justified. 

In Massachi v. Astrue the Ninth Circuit held for the first 

time that an ALJ may not rely on a VE's testimony regarding the 

requirements of a particular job without first inquiring whether 

the testimony conflicts with the DOT. 486 F.3d 1149, 1152-53 

(9th Cir. 2007). The court noted, however, this procedural error 

could be harmless if the VE provided sufficient support for her 

8 - OPINION AND ORDER 

Case 6:15-cv-00647-BR Document 25 Filed 10/04/16 Page 8 of 11
conclusion so as to justify any potential conflicts. Id. at 1154 

n. 19. 

Here the Court found the ALJ erred when he failed to ask the 

VE whether his opinion was consistent with the DOT, but the Court 

concluded the error was harmless because the VE and ALJ 

adequately explained the only possible inconsistency with the 

DOT. The Court concludes, therefore, the government's position 

was reasonable and substantially justified on this issue. 

III. The ALJ's error in failing to reconcile the inconsistency 

between his analysis in "Paragraph B" at Step Three and his 

assessment of Plaintiff's RFC. 

The Court remanded this matter for further proceedings on 

the basis that the ALJ erred when he made inconsistent findings 

between his "paragraph B" analysis at Step Three (that Plaintiff 

had "moderate difficultiesn with concentration, persistence, and 

pace) and his assessment of Plaintiff's RFC (that Plaintiff had 

an "average ability" to perform sustained work activities 

related to concentration, persistence, or pace in an ordinary 

work setting "on a regular basisn). Opin. and Order (#19) at 14. 

Plaintiff contends the Court's finding of error and Order 

remanding the case for further proceedings entitles Plaintiff to 

an award of attorneys' fees pursuant to EAJA. The Commissioner, 

however, contends because the ALJ's assessment of Plaintiff's RFC 

was based on and supported by medical evidence in the record, the 

ALJ's decision and the Commissioner's subsequent defense thereof 

9 - OPINION AND ORDER 

Case 6:15-cv-00647-BR Document 25 Filed 10/04/16 Page 9 of 11
had a reasonable basis in law and fact despite the ALJ's 

inconsistent finding at Step Three that Plaintiff has "moderate" 

difficulties with concentration, persistence, and pace. As the 

Commissioner points out, an ALJ's RFC assessment of a claimant 

"adequately captures restrictions related to concentration, 

persistence, or pace where the assessment is consistent with 

restrictions identified in the medical testimony." StubbsDanielson v. Astrue, 539 F.3d 1169, 1174 (9th Cir. 2008). 

Here even though the Court noted the ALJ's RFC finding of 

average ability "may be supported by substantial evidence in 

isolation," the Court concluded in its Opinion and Order that the 

ALJ did not adequately explain the inconsistency between his Step 

Three analysis and his assessment of Plaintiff's RFC. The Court, 

therefore, remanded this matter to permit the ALJ to clarify his 

findings. Opin. and Order (#19) at 14. Nevertheless, because 

the ALJ's assessment of Plaintiff's RFC was largely "consistent 

with restrictions identified in the medical testimony," the Court 

concludes, therefore, that the Commissioner's position in this 

regard was not unreasonable nor substantially unjustified. 

10 - OPINION AND ORDER 

Case 6:15-cv-00647-BR Document 25 Filed 10/04/16 Page 10 of 11
CONCLUSION 

For these reasons, the Court DENIES Plaintiff's Motion (#21) 

for EAJA Fees and Costs. 

IT IS SO ORDERED. 

DATED this 4th day of October, 2016. 

/s/ Anna J. Brown 

ANNA J. BROWN 

United States District Judge 

11 - OPINION AND ORDER 

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