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David S. v. Berryhill

United States District Court, W.D. Washington, Tacoma

April 18, 2019

David S., Plaintiff,
v.
Nancy A. Berryhill, Deputy Commissioner of Social Security for Operations, Defendant.

          ORDER REVERSING AND REMANDING DEFENDANT'S DECISION TO DENY BENEFITS

          David W. Christel United States Magistrate Judge

         Plaintiff David S. filed this action, pursuant to 42 U.S.C. § 405(g), for judicial review of Defendant's denial of Plaintiff's application for disability insurance benefits (“DIB”). Pursuant to 28 U.S.C. § 636(c), Federal Rule of Civil Procedure 73 and Local Rule MJR 13, the parties have consented to have this matter heard by the undersigned Magistrate Judge. See Dkt. 5.

         After considering the record, the Court concludes the Administrative Law Judge (“ALJ”) erred in failing to properly consider the medical opinion of H. Richard Johnson, M.D. Had the ALJ properly considered the medical opinion evidence, the ALJ may have determined Plaintiff is disabled or included additional limitations in the residual functional capacity (“RFC”) assessment. Therefore, the ALJ's error is harmful and this matter should be reversed and remanded pursuant to sentence four of 42 U.S.C. § 405(g) to the Deputy Commissioner of the Social Security Administration for Operations (“Commissioner”) for further proceedings consistent with this Order.

         FACTUAL AND PROCEDURAL HISTORY

         On March 10, 2016, Plaintiff filed an application for DIB with a disability onset date of April 17, 2015. See Dkt. 7, Administrative Record (“AR”) 287-88, 298-99. The application was denied upon initial administrative review and on reconsideration. See AR 196-217, 223-28. A hearing was held before ALJ David Johnson (“the ALJ”) on July 17, 2017. See AR 147-95. In a decision dated October 12, 2017, the ALJ determined Plaintiff to be not disabled. See AR 37-58. Plaintiff's request for review of the ALJ's decision was denied by the Appeals Council, making the ALJ's decision the final decision of the Commissioner. See AR 1-6; 20 C.F.R. § 404.981, § 416.1481.

         In Plaintiff's Opening Brief, Plaintiff maintains the ALJ erred by: (1) determining Plaintiff had chronic fatigue syndrome; (2) determining Plaintiff did not meet a mental health listing; (3) improperly evaluating the medical opinion evidence; (4) improperly evaluating Plaintiff's subjective symptom testimony; and (5) improperly evaluating the lay witness testimony. Dkt. 9 at 3-4.

         STANDARD OF REVIEW

         Pursuant to 42 U.S.C. § 405(g), this Court may set aside the Commissioner's denial of social security benefits if the ALJ's findings are based on legal error or not supported by substantial evidence in the record as a whole. Bayliss v. Barnhart, 427 F.3d 1211, 1214 n.1 (9th Cir. 2005) (citing Tidwell v. Apfel, 161 F.3d 599, 601 (9th Cir. 1999)).

         DISCUSSION

         I. Whether the ALJ properly considered all of Plaintiff's impairments at Step Two of the sequential evaluation process.

         Plaintiff contends the ALJ erred by finding Plaintiff had chronic fatigue syndrome and by finding Plaintiff did not meet a mental health listing at Step Two of the sequential evaluation process. Dkt. 9 at 2-5.

         Step Two of the Administration's evaluation process requires the ALJ to determine whether the claimant “has a medically severe impairment or combination of impairments.” Smolen v. Chater, 80 F.3d 1273, 1290 (9th Cir. 1996) (citation omitted); 20 C.F.R. §§ 404.1520(a)(4)(ii), 416.920(a)(4)(ii) (1996). An impairment is “not severe” if it does not “significantly limit” the ability to conduct basic work activities. 20 C.F.R. §§ 404.1522, 416.922 (2017). “Basic work activities are ‘abilities and aptitudes necessary to do most jobs, including, for example, walking, standing, sitting, lifting, pushing, pulling, reaching, carrying or handling.'” Smolen, 80 F.3d at 1290 (quoting 20 C.F.R. § 140.1521(b)).

         At Step Two, the ALJ found Plaintiff had “the following severe impairments: obesity, degenerative joint disease (DJD), degenerative disc disease (DDD), hepatitis C, lumbar sprain strain, spondylosis, radiculopathy, meralgia paresthetica, generalized anxiety disorder (GAD), major depressive disorder (MDD), and pain disorder.” AR 42 (internal citations omitted).

         First, Plaintiff argues the ALJ erred by finding Plaintiff's pain disorder[1] as a severe impairment due to evidence from Dr. Johnson. Dkt. 9 at 5-6. Plaintiff concedes this issue is “not determinative of the unfavorable decision itself, ” but because the error at Step Two “sets the stage” for the ALJ's analysis of the medical opinion evidence, Plaintiff's testimony and the lay witness testimony, the entire sequential evaluation process is tainted and a new sequential evaluation must be undertaken. Dkt. 9 at 5-6. Plaintiff also argues the ALJ erred because he assigned no weight to Dr. Johnson's opinion, which was the sole opinion containing the pain disorder diagnosis.[2] Dkt. 9 at 5-6. Defendant argues the inclusion of an impairment at Step Two is without prejudice because Step Two was decided in Plaintiff's favor. Dkt. 10 at 3-4.

         Here, the Court concludes ALJ's error with respect to Plaintiff's pain disorder was harmless. See Molina v. Astrue, 674 F.3d 1104, 1111 (9th Cir. 2012) (“we may not reverse an ALJ's decision on account of an error that is harmless”). While failing to list a severe impairment at Step Two could potentially mean an ALJ fails to consider an entire category of impairments (i.e. physical or mental), here the ALJ's alleged error was one of over-inclusion. Moreover, because the ALJ found other physical and mental impairments to be severe, AR 43, he proceeded with the remaining steps of the sequential evaluation process. Plaintiff has failed to demonstrate the ALJ's inclusion of Plaintiff's pain disorder at Step Two impacted the ALJ's analysis of his testimony, consideration of the lay witness testimony or at the subsequent steps of the analysis. Accordingly, the Court finds no prejudicial error at Step Two.

         Next, Plaintiff contends the ALJ erred because the ALJ's decision “conducts a cursory analysis of the ‘Paragraph B' criteria for evaluation of mental health impairments.” Dkt. 9 at 6. The Social Security Regulations set forth a specific procedure for evaluating mental impairments. 20 C.F.R. § 404.1520a(a). This procedure applies “at each level in the administrative review process, ” including the ALJ's written decision issued after a hearing. See Id. According to this procedure, the ALJ first must determine whether or not a medically-determinable mental impairment exists by evaluating the relevant symptoms, signs and laboratory findings. 20 C.F.R. § 404.1520a(b)(1); see also 20 C.F.R. §§ 404.1508, 404.1528.

         Once it is determined a mental impairment exists, the ALJ “must rate the degree of functional limitation resulting from the impairment(s).” 20 C.F.R. § 404.1520a(b)(2). The ALJ must also rate the degree of functional limitation in activities of daily living; social functioning; concentration, persistence or pace; and episodes of decompensation. 20 C.F.R. § 404.1520a(c)(3). The regulations require the ALJ rate the degree of functional limitation in the four areas described above. Id. As quoted by the Ninth Circuit, the ALJ's written decision “‘must incorporate the pertinent findings and conclusions based on the technique,' and ‘must include a specific finding as to the ...


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