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Herrmann v. Berryhill

United States District Court, N.D. Indiana, Fort Wayne Division

December 20, 2017

NANCY A. BERRYHILL, Acting Commissioner of Social Security, Defendant.



         This matter is before the Court on the Defendant's “Motion for Reversal with Remand for Further Administrative Proceedings and Development Under Sentence Four of 42 U.S.C. § 405(g), ” filed on October 17, 2017 (ECF 20). Plaintiff Michelle A. Herrmann filed a response in opposition on October 26, 2017 (ECF 21). The Commissioner chose not to file a reply brief and so the motion is ripe for resolution. Also before the Court is Herrmann's opening “merits” brief, filed pursuant to Local Rule 7-3(b) on July 11, 2017 (ECF 15). The Commissioner chose to file the motion for remand in lieu of a response to the merits brief. For the reasons discussed below, the decision of the Commissioner is REVERSED and the Court REMANDS this case to the Social Security Administration for an award of disability benefits to the Plaintiff for the period from June 9, 2003, to September 6, 2010.


         The process of obtaining Social Security benefits can take years, given the agency level administrative procedures and subsequent federal court litigation that many cases, like this one, go through before they are resolved. A few examples from recent social security cases filed in this district illustrate this. See Keys v. Berryhill, 679 F.App'x 477, 478 (7th Cir. 2017) (claimant/plaintiff applied for benefits in December 2011; decision by ALJ denying benefits on April 22, 2013; complaint filed on August 15, 2014; decision by this Court on February 5, 2016, affirming ALJ's denial of benefits; affirmed by Seventh Circuit on February 9, 2017); Parker v. Colvin, 660 F.App'x 478, 479 (7th Cir. 2016) (claimant/plaintiff applied for benefits in May 2012; decision by ALJ denying benefits on August 15, 2013; complaint filed on January 10, 2014; decision by this Court on November 5, 2015, affirming ALJ's denial of benefits; affirmed by Seventh Circuit on October 20, 2016); Reed v. Colvin, 656 F.App'x 781, 782 (7th Cir. 2016) (claimant/plaintiff applied for benefits in June 2011; decision by ALJ denying benefits on January 10, 2013; complaint filed on March 14, 2014; decision by this Court on August 18, 2015, affirming ALJ's denial of benefits; affirmed by Seventh Circuit on August 16, 2016).

         The present case has been winding its way laboriously through the system much longer than most-about 10 years longer. Michele Herrmann filed her application for Supplemental Security Income on June 9, 2003, alleging a disability onset date of January 1, 1980. Administrative Record Transcript (“Tr.”) (ECF 10), p. 31.[1] Herrmann's application was rejected initially, after reconsideration, and in a decision issued by Administrative Law Judge Bryan Bernstein on March 27, 2007. Tr., pp. 31-40. Herrmann requested review by the Appeals Council but was denied on August 7, 2007 (Tr., p. 14), at which point the ALJ's decision became the final decision of the Commissioner. Herrmann filed a complaint in this Court on October 12, 2007, in case number 1:07-CV-255. Tr., p. 392. United States Magistrate Judge Roger B. Cosbey issued an opinion on August 8, 2008, reversing ALJ Bernstein's decision (Tr., pp. 391-413) and the Appeals Council remanded the matter to the ALJ. Tr., pp. 387-88. ALJ Bernstein conducted a second hearing and again denied Herrmann's application in a decision issued on January 26, 2011. Tr., pp. 337-50. Herrmann again requested review by the Appeals Council, which this time issued a partially favorable decision on May 9, 2012, finding that Herrmann became disabled as of September 6, 2010, and was entitled to benefits as of that date. Tr., pp. 326-29. The Appeals Council, however, upheld the ALJ's determination that Herrmann was not disabled between the filing date and September 6, 2010. Id. It is that period-from June 9, 2003, through September 6, 2010-that is in dispute now. Herrmann continues to insist that she was disabled during that period and therefore entitled to benefits. Herrmann filed a second complaint in this Court on July 6, 2012, in cause number 1:12-CV-229. Tr., p. 706. United States Magistrate Judge John E. Martin affirmed the Commissioner's decision on September 24, 2013. Tr., p. 710. Herrmann appealed that judgment to the Seventh Circuit, which issued an opinion on December 4, 2014, reversing the Magistrate's decision. Tr., pp. 697-705. Magistrate Judge Martin remanded the matter to the Commissioner for further proceedings in light of the Seventh Circuit's decision. Tr., p. 711. Following a third hearing, ALJ Stephanie Katich once again concluded that Herrmann was not disabled during the period in question and entered a decision on October 13, 2016, explaining her reasoning. Tr., pp. 648-68. Herrmann did not file exceptions with the Appeals Council and the Appeals Council did not take jurisdiction of the claim. Thus, ALJ Katich's decision became the (most recent) final decision of the Commissioner. Herrmann then filed this case on February 10, 2017 (ECF 1). In compliance with this district's Local Rule 7-3, Herrmann filed her opening brief in support of her Complaint on July 11, 2017, asking this Court to “reverse the decision of the ALJ and remand this matter for an award of benefits, or, in the alternative, reverse the ALJ's decision and remand for further proceedings[.]” Plaintiff's Merits Brief (ECF 15), p. 26.

         The Commissioner responded by filing the pending motion to remand in lieu of a typical response brief, arguing that “[r]emand is warranted because the ALJ failed to properly evaluate part of the opinion of consultative examiner Michael E. Holton, M.D. . . . contrary to the Seventh Circuit's decision remanding the case in December 2014. . . . Accordingly, the Defendant moves this court to remand this case to SSA for a new hearing and decision pursuant to the fourth sentence of 42 U.S.C. § 405(g), which provides that this ‘court shall have power to enter, upon the pleadings and transcript of the record, a judgment affirming, modifying, or reversing the decision of the Commissioner of Social Security, with or without remanding the cause for a rehearing.'” Defendant's Motion for Remand, p. 1. The Commissioner states that “[s]pecifically, this Court should order that, on remand, the Commissioner: 1) will conduct further administrative proceedings; 2) give consideration to the opinion of consultative examiner Holton, and explain the weight assigned to such; 3) and [sic] issue a new decision.” Id., pp. 1-2. The Commissioner acknowledges that “Plaintiff's counsel . . . indicated he did not consent to a remand motion with this language.” Id., p. 2. That is because Herrmann contends “the appropriate remedy is an award of benefits to Ms. Herrmann, for the period at issue-June 2003 through September 6, 2010.” Plaintiff's Response, p. 1. Furthermore, argues Herrmann, “[t]he Commissioner failed to address numerous errors in the ALJ's decision which Plaintiff discussed at length in her opening merits brief. By filing this motion for remand, following Plaintiff having filed a 25 page detailed brief, asserting numerous errors in the ALJ's decision, the Commissioner has put the case in a procedurally awkward position. The lack of response to an argument creates a negative inference, waiving defense of the issue. . . . Thus, if the Court does not find remand for an award of benefits to be the appropriate remedy in this matter, the Court should remand on each issue raised by Plaintiff in her opening merits brief, because the Commissioner has waived a defense to any and all issues raised by Plaintiff.” Id., p. 2. In her opening brief, Herrmann contends that 1) the ALJ erred by not giving proper weight to, and by improperly assessing, the medical opinions of her treating physician, Dr. Bauscher, as well as consultative examining physicians, Drs. Holton, Bacchus, and Ksionski; 2) that the ALJ erred when calculating her residual functional capacity; 3) that the ALJ erred in assessing Herrmann's testimony regarding the severity of her impairments; and 4) that the ALJ erred by relying on the testimony of a vocational expert. Plaintiff's Merits Brief, pp. 15-25. Herrmann contends that for all these reasons “the Court [should] reverse the decision of the ALJ and remand this matter for an award of benefits, or, in the alternative, reverse the ALJ's decision and remand for further proceedings consistent with the argument set forth above.” Id., p. 26.

         So, Herrmann wants the Court to remand for the granting of benefits or, in the alternative, issue a remand order that protects her ability to raise before the ALJ all the arguments she presents in her merits brief. The Commissioner seeks remand on a much more limited scope.


         The Social Security Act authorizes judicial review of a final decision denying benefits, but also provides that an ALJ's findings must be accepted as conclusive if supported by substantial evidence. Visinaiz v. Berryhill, 243 F.Supp.3d 1008, 1011 (N.D. Ind. 2017). “Thus, a court reviewing the findings of an ALJ will reverse only if the findings are not supported by substantial evidence or if the ALJ has applied an erroneous legal standard.” Id. (citing Briscoe v. Barnhart, 425 F.3d 345, 351 (7th Cir. 2005)). Substantial evidence consists of “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Id. (citations omitted).

         The district court “reviews the entire administrative record but does not reconsider facts, re-weigh the evidence, resolve conflicts in evidence, decide questions of credibility, or substitute its judgment for that of the ALJ.” Id. (citing Boiles v. Barnhart, 395 F.3d 421, 425 (7th Cir. 2005); Clifford v. Apfel, 227 F.3d 863, 869 (7th Cir. 2000); Butera v. Apfel, 173 F.3d 1049, 1055 (7th Cir. 1999)). The question on judicial review of an ALJ's finding that a claimant is not disabled within the meaning of the Social Security Act is not whether the claimant is, in fact, disabled, but whether the ALJ “‘uses the correct legal standards and the decision is supported by substantial evidence.'” Id. at 1011-12 (quoting Roddy v. Astrue, 705 F.3d 631, 636 (7th Cir. 2013) and citing O'Connor-Spinner v. Astrue, 627 F.3d 614, 618 (7th Cir. 2010); Prochaska v. Barnhart, 454 F.3d 731, 734-35 (7th Cir. 2006); Barnett v. Barnhart, 381 F.3d 664, 668 (7th Cir. 2004)). “‘[I]f the Commissioner commits an error of law, ' the Court may reverse the decision ‘without regard to the volume of evidence in support of the factual findings.'” Id. at 1012 (quoting White v. Apfel, 167 F.3d 369, 373 (7th Cir. 1999)). Put another way, this Court must review an ALJ's findings and conclusions to ensure that they are not contrary to applicable law and that the ALJ adequately explains his or her reasoning for those conclusions. As Magistrate Judge Martin explained in Visinaiz:

At a minimum, an ALJ must articulate his or her analysis of the evidence in order to allow the reviewing court to trace the path of her reasoning and to be assured that the ALJ considered the important evidence. See Scott v. Barnhart, 297 F.3d 589, 595 (7th Cir. 2002); Diaz v. Chater, 55 F.3d 300, 307 (7th Cir. 1995); Green v. Shalala, 51 F.3d 96, 101 (7th Cir. 1995). An ALJ must “‘build an accurate and logical bridge from the evidence to [the] conclusion' so that, as a reviewing court, we may assess the validity of the agency's final decision and afford [a claimant] meaningful review.” Giles v. Astrue, 483 F.3d 483, 487 (7th Cir. 2007) (quoting Scott, 297 F.3d at 595)); see also O'Connor-Spinner, 627 F.3d at 618 (“An ALJ need not specifically address every piece of evidence, but must provide a ‘logical bridge' between the evidence and his conclusions.”); Zurawski v. Halter, 245 F.3d 881, 889 (7th Cir. 2001) (“[T]he ALJ's analysis must provide some glimpse into the reasoning behind [the] decision to deny benefits.”).

Id. This case presents an added dimension in that the Court must apply the established standard of review against the backdrop of the Seventh Circuit's decision remanding the case.


         Herrmann is correct that this case is “in a procedurally awkward position.” An ALJ issues a decision that is favorable to the Commissioner; the claimant files suit in federal court challenging that decision; the Commissioner, rather than defend that favorable decision by filing a response to the claimant's merits brief, seeks remand on the basis that the decision failed in some unspecified way to comply with the Seventh Circuit's decision reversing the previous ALJ's decision. Adding another wrinkle to this case, as Herrmann points out, is that the Commissioner's decision to forgo filing a response to Herrmann's merits brief gives rise to waiver issues (as discussed below). But while the case is certainly in a quirky posture, the path to resolving it is clear and starts with the Seventh Circuit's decision in Herrmann v. Colvin, 772 F.3d 1110 (7th Cir. 2014).

         The appellate court reversed ALJ Bernstein's decision (and Magistrate Judge Martin's decision affirming it) for several reasons, of which the issue of Dr. Holton's opinion was one. Beginning there, the Seventh Circuit noted that the ALJ “discussed at great[] length the evidence of Dr. Michael Holton, ” but concluded that the ALJ's explanation of his assessment of Dr. Holton's opinion-that is, his decision to give it no weight-was “garbled.” Herrmann, 772 F.3d at 1112. The appellate court concluded that “[t]he district court's statement that ‘the ALJ's evaluation of Dr. Holton's opinion may not be perfect' is a considerable understatement. Coupled with the administrative law judge's unreasoned brush off of the evidence offered by the other consulting physicians, his confused rejection of Dr. Holton's evidence should have persuaded the [magistrate] judge to reverse the denial of relief to [Herrmann] and remand the matter to the Social Security Administration.” Id.

         So, this peripatetic case went back to the SSA and landed with ALJ Katich, who reviewed the case yet again, conducted another hearing, and concluded that “the undersigned largely agrees with the findings of the prior Administrative Law Judge, whose opinion has since been vacated. There is little basis in the objective medical evidence for the severity and frequency of symptoms alleged by the claimant. While the physical examinations from 2003 through June 2010 revealed some abnormalities, they were neither persistent nor preclusive of all work activity[.]” ALJ Katich Decision, Tr., p. 666.

         Herrmann filed the present case to challenge this conclusion for the reasons set out in her merits brief. The Commissioner also wants the case remanded, but for only one reason-so an ALJ can “give consideration to the opinion of consultative examiner [Dr. Michael] Holton, and explain the weight assigned to such[.]” Motion for Remand, p. 2. The Commissioner states that since “[t]he Seventh Circuit, considering Dr. Holton's opinion, did not find reversal for payment to be the appropriate remedy . . . [i]t is still not the appropriate remedy.” Id. The Commissioner contends that since the Seventh Circuit remanded the case for further proceedings rather than reverse for an award benefits, this Court should likewise deny Herrmann's request for benefits and remand the case so yet another ALJ can take a stab at assessing Dr. Holton's opinion and explaining-finally and properly, in keeping with the Seventh Circuit's decision-why it should be credited or not credited.

         The Commissioner claims that ALJ Katich failed to apply the Seventh Circuit's decision when she reheard the case, specifically with regard to Dr. Holton's opinion. The Commissioner is silent though-completely silent-with regard to how ALJ Katich erred or why her decision is flawed. As Herrmann puts it, “the Commissioner does not include any specific reasons the ALJ should reconsider Dr. Holton's opinion, explain which portion(s) of the opinion the ALJ did not properly consider, or explain any particular error in the ALJ's prior consideration of the opinion. As this case has been pending with the Agency for 14 years, such a generic remand is hardly appropriate.” Plaintiff's Response, p. 1. The Commissioner wants a remand and wants an ALJ to “issue a new decision.” Id., p. 2. But for what reason and to what end? The Commissioner's argument is nothing more than a request for a remedy-remand and a new decision-but she fails to identify a single issue with ALJ Katich's decision that allegedly requires further administrative review. Instead, the Commissioner bases her request on the unadorned conclusion that Judge Katich failed to heed the decision of the appellate court, without bothering to explain how she failed to do that.

         Notwithstanding the Commissioner's failure to present a developed argument in support of remand, the Court cannot resolve this case now without determining whether ALJ Katich's decision corrects or avoids the problems identified in the Seventh Circuit's December 4, 2014, decision. In other words, even though the Commissioner fails to explain how ALJ Katich's decision runs afoul of the Seventh Circuit's decision, this Court has to review her decision in light of that opinion anyway. So in essence the Commissioner wins a battle here-the case must be remanded because the ALJ's decision is flawed, in part due to her incorrect assessment of Dr. Holton's opinion as the Commissioner contends-but loses the war because the Court concludes that remand for an award of benefits is the proper resolution for several reasons in addition to the issue of Dr. Holton's opinion.

         I. Herrmann v. Colvin, 772 F.3d 1110 (7th Cir. 2014).

         The Seventh Circuit began by noting that Herrmann's application for benefits “was turned down by an administrative law judge of the Social Security Administration for the benefit she sought for years before she turned 55. But because of the less demanding showing of disability required of applicants that age and older, she was deemed to have become disabled when she reached 55.” Herrmann, 772 F.3d at 1110. Next, addressing the period from June 2003 to September 2010, the Seventh Circuit summarized the medical evidence as follows:

The applicant's treating physicians, together with three consultative physicians selected by the Social Security Administration who examined the applicant and studied her medical records, advised the administrative law judge that she suffers from fibromyalgia, spinal disk disease, “photophobia” (abnormal sensitivity to light), and other ailments unnecessary to discuss, and that as a result she walks haltingly, has difficulty gripping objects, experiences difficulty in rising from a sitting position, has trouble concentrating in a bright room or when looking at a computer screen, and as a result of this assemblage of impairments cannot do even light work on a full-time basis. If this is right she was disabled before she turned 55 and is therefore entitled to a back payment of Supplemental Security Income.

Id. at 1111. That last sentence states the issue in this case: if substantial evidence supports the summary of impairments, then Herrmann should be awarded benefits beyond what she has received.

         The Seventh Circuit was displeased with ALJ Bernstein's decision because the Court felt that he botched the assessment of physicians' opinions (not just Dr. Holton's) and gave weight to unreliable statistical evidence presented by a vocational expert. As to the first issue, the appellate court concluded that “the [ALJ] brushed aside the physicians' findings. Typical was his statement that the opinion of Dr. Dauscher, one of the applicant's treating physicians, would be ‘given no significant weight, because the functional limitations are not supported by Dr. Dauscher's sparse treatment statement notes or by examination findings made by other physicians.' The [ALJ] seems to have thought that a physician's evidence can be disregarded unless he has detailed notes to back it up and other physicians can provide identical evidence even if they don't contradict him-in other words no credibility without corroboration. These are insufficient grounds for disbelieving the evidence of a qualified professional.” Id. (italics added). The Court held that even though ALJ Bernstein “discussed at greatest length the evidence of Dr. Michael Holton, ” . . . his findings and conclusions regarding that evidence were “garbled” and “confused.” Id. at 1112. In other words, ALJ Bernstein's decision failed to provide a “‘logical bridge' between the evidence and his conclusions[, ]” O'Connor-Spinner v. Astrue, 627 F.3d 614, 618 (7th Cir. 2010), so the case had to be remanded.

         The Seventh Circuit also found that “[t]here is more wrong with [ALJ Bernstein's] opinion. The more involves an issue we discussed in Browning v. Colvin, 766 F.3d 702, 708-12 (7th Cir. 2014), concerning testimony by vocational experts regarding the number of jobs in the local, state, and national economy that an applicant for social security benefits is capable of performing.” Id. The appellate court expressed concerns about the reliability of the testimony of the vocational expert in this case. The Seventh Circuit's criticism of VE testimony is not limited to this case and some other circuits share the concern. Id. at 1113 (“[w]e are not alone in harboring such doubts.”) (citing Brault v. Social Security Administration, 683 F.3d 443, 446-47 (2d Cir. 2012) (“we agree with the Seventh Circuit that evidence cannot be substantial if it is ‘conjured out of whole cloth.'”) (quoting Donahue, 279 F.3d at 446)); Guiton v. Colvin 546 F.App'x 137, 143-45 (4th Cir. 2013) (questioning reliability of VE testimony). The Seventh Circuit pointed out that the statistics relied on by VEs are based, at least in large part, on “the Dictionary of Occupational Titles (4th ed. 1991) (the ‘DOT' as it is called)[, ]” which the court concluded is “an obsolete catalog of jobs (most of the entries in it date back to 1977) but it contains no statistics regarding the number of jobs in a given job category that exist in the local, state, or national economy.” Id. To arrive at those numbers, vocational experts use additional data, such as census data, and then arrive at an estimate of the number of jobs in the local and national economy that an applicant could perform-a process the Seventh Circuit believes “would be an arbitrary estimate[.]” Id. at 1114. As the court put it, “[i]f the only jobs that the applicant is physically and mentally capable of doing no longer exist in the American economy (such as pin setter, phrenologist, leech collector, milkman, pony express rider, and daguerreotypist), the applicant is disabled from working, and likewise, as a realistic matter, if there is an insignificant number of such jobs.” Id. at 1113. More specific to this case, according to the Seventh Circuit, was that “[w]e do not know how the vocational expert in this case calculated the numbers to which he testified. Nothing in the record enables us to verify those numbers, which the administrative law judge accepted.” Id. at 1114.

         For those reasons the Seventh Circuit remanded this case and the unenviable task of hearing the matter all over again fell to ALJ Katich. This Court must determine whether Judge Katich's decision is “supported by substantial evidence or if the ALJ has applied an erroneous legal standard.” Visinaiz v. Berryhill, 243 F.Supp.3d at 1011 (citing Briscoe v. Barnhart, 425 F.3d 345, 351 (7th Cir. 2005)). In this case that determination turns mostly on whether ALJ Katich addressed the issues identified by the appellate court.

         II. ALJ decision of October 13, 2016 (Tr., pp. 648-68).

         It is curious and rather disappointing that while ALJ Katich discussed Dr. Holton's opinion in her decision, and also relied on statistical vocational evidence, her only mention of the Seventh Circuit's decision is her statement that ALJ Bernstein's prior decision “has since been vacated.” She didn't even cite the case, let alone discuss it or indicate whether-and if so how-it affected her review. Let's be frank here-the Seventh Circuit thought that ALJ Bernstein's decision stunk, but ALJ Katich concluded after reviewing this case that she “largely agrees with the findings” contained in Bernstein's decision. If her assessment of the evidence was proper and her reasoning supported by substantial evidence then her decision would have to be affirmed, even if it might seem counterintuitive that her determination could be based on the fact that she “largely agrees with the findings” of a decision that the Seventh Circuit concluded was fundamentally flawed. Put another way, if ALJ Katich applied the proper legal standards to her review of the evidence and if her conclusions are supported by substantial evidence, then her decision should be affirmed even though her ultimate determination-that Herrmann was not disabled during the period of time in question-is the same as ALJ Bernstein's. The Court agrees with Herrmann, however, that the ALJ's decision is inconsistent with the Seventh Circuit's decision. And, given that the Commissioner has waived any arguments that she could have raised in response to the arguments presented by Herrmann in her merits brief, remand for an award of benefits is warranted.

         After she reviewed the record and conducted a hearing, the ALJ made the following ...

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