Coleman v. Barnhart

Full title: TERESA A. COLEMAN, Plaintiff, v. JO ANNE B. BARNHART, Commissioner of…

Court: United States District Court, N.D. California

Date published: Nov 12, 2003

No. C 03-00089 SI (N.D. Cal. Nov. 12, 2003)

Opinion

No. C 03-00089 SI

November 12, 2003

JUDGMENT

SUSAN ILLSTON, District Judge

In accordance with the Court's Order of November 12, 2003, judgment is hereby entered.

IT IS SO ADJUDGED.

ORDER DENYING PLAINTIFF'S MOTION FOR LEAVE TO WITHDRAW STIPULATION FOR DISMISSAL, DENYING PLAINTIFF'S REQUEST FOR LEAVE TO FILE SECOND AMENDED COMPLAINT, DENYING PLAINTIFF'S MOTION FOR MANDAMUS, AND GRANTING DEFENDANT'S MOTION TO DISMISS BACKGROUND On February 9, 1998, Plaintiff Teresa Coleman filed a claim for Social Security Disability Insurance benefits that was subsequently denied. Compl. ¶ 3. An Administrative Law Judge (ALJ) held a hearing on March 23, 1999, at Plaintiffs request. Compl. ¶ 3. The ALJ upheld the initial determination in an order dated April 21, 1999, which Plaintiff appealed to the Appeals Council on April 28, 1999. Compl. ¶ 3-4. Plaintiff alleges that she contacted the Appeals Council once in writing and twice via telephone between August 2, 2001 and January 6, 2002 to inquire about the status of her appeal, without a response. Compl. ¶ 5-7.

Plaintiff filed the instant "Motion for Mandamus, Declaratory and Injunctory Relief on January 7, 2003. On April 3, 2003, nearly three years after Plaintiffs appeal, the Appeals Council issued an order remanding the case to the ALJ for review of a physician's report submitted after the initial decision. Appeals Council Order at 1. In light of this action by the Appeals Council, the parties entered into a stipulated dismissal on April 9, 2003. One week later, Plaintiff requested leave to withdraw the stipulated dismissal and moved instead for the matter to be remanded to the Commissioner pursuant to sentence six of 42 U.S.C. § 405(g). Pl.'s Req. for Leave to Withdraw Stipulation at 2-3. Defendant thereafter moved to dismiss for lack of subject matter jurisdiction based on failure to exhaust administrative remedies. Def.'s Mot. to Dismiss at 2-3. In response, Plaintiff renewed her motion for mandamus under 28 U.S.C. § 1361, seeking an injunction requiring the Defendant to provide a final decision in a timely manner, or in the alternative, judicial review of the Commissioner's determination on the merits as provided for in 42 U.S.C. § 405(g). Recently, Plaintiff also requested leave to file a second amended complaint. Plaintiffs request for leave to withdraw the stipulated dismissal, her request for leave to file a second amended complaint, her motions for remand, mandamus, and review on the merits, as well as Defendant's motion to dismiss, are now before this court.

LEGAL STANDARDS

A federal district court has jurisdiction to review final decisions of the Commissioner of Social Security. 42 U.S.C. § 405(g), 1383(c)(3).¹ A final decision consists of two elements: a nonwaivable requirement that a claim for benefits be presented to the Commissioner, and a waivable requirement that administrative remedies be exhausted.See Bowen v. City of New York, 476 U.S. 467, 483, 106 S.Ct. 2022, 2031 (1986). A court may waive the exhaustion requirement only if: 1) the claim for which judicial review is sought is collateral to the claimant's substantive claim of entitlement to benefits; 2) the claimant has made a colorable showing that he would suffer irreparable injury if the exhaustion requirement were enforced; and 3) exhaustion of administrative remedies would be futile. See City of New York, 476 U.S. at 483: see also Johnson v. Shalala. 2 F.3d 918, 921 (9th Cir. 1993).

1 The judicial review provisions of 42 U.S.C. § 405(g) (Title II of the Social Security Act) are expressly incorporated into § 1383(c)(3) (Title XVI). See Kildare v. Saenz, 325 F.3d 1078, 1080 (9th Cir. 2003).

The Mandamus and Venue Act of 1961 confers upon district courts original jurisdiction of "any action . . . to compel an officer or employee of the United States or any agency thereof to perform a duty owed to the plaintiff." 28 U.S.C. § 1361. Mandamus will lie against the Commissioner if a plaintiff can demonstrate that the Commissioner has not performed a "clear nondiscretionary duty" owed to her. Briggs v. Sullivan, 886 F.2d 1132, 1142 (9th Cir. 1989). Mandamus is an "extraordinary remedy" available 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." Patel v. Reno. 134 F.3d 929, 931 (9th Cir. 1998).

Once a district court asserts jurisdiction over a social security disability benefits claim, the Commissioner can move, before filing an answer, to remand the case to the agency for further consideration of additional evidence, per sentence six of § 405(g). This is known as a "sentence six remand," and can be pled only by the Defendant. A court will only grant such a remand "upon a showing that there is new evidence which is material and that there is good cause for the failure to incorporate such evidence into the record in a prior proceeding." 42 U.S.C. § 405(g).

The standard used by district courts in deciding whether to allow a party to amend its pleadings should be applied to a plaintiffs request for leave to amend a complaint, as well as leave to withdraw her voluntary dismissal. See Robinson v. Worthington. 544 F. Supp. 956, 963-64 (D.C.Ala. 1982). This standard was construed liberally inFoman v.Davis: "If the underlying facts or circumstances relied upon by a plaintiff may be a proper subject of relief, he ought to be afforded an opportunity to test his claim on the merits." 371 U.S. 178, 182, 83 S.Ct. 227, 230 (1962). However, the leave sought should not be "freely given" where the moving party exhibits "repeated failure to cure deficiencies by amendments previously allowed," or the "futility of amendment." Id. In its discretion, a court will usually modify or vacate a stipulated dismissal only where (1) the court dismissed with prejudice despite the parties' stipulation that the dismissal be without prejudice, or (2) the court imposed conditions on the dismissal that were not part of the stipulation. See O'Connor's Federal Rules, Civil Trials, 363.

DISCUSSION

Defendant contends that this court lacks subject matter jurisdiction under 42 U.S.C. § 405(g) because no final decision has been entered by the Commissioner in Plaintiffs case. Plaintiff responds that she satisfies the conditions for waiver of the exhaustion requirement of § 405(g). In the alternative, Plaintiff suggests, the court has mandamus jurisdiction over the claim, because the Commissioner's duty to provide a timely final decision was not discretionary, and the prospect of continuing delay renders exhaustion of administrative remedies futile. Additionally, Plaintiff seeks to withdraw her motion for voluntary dismissal. Defendant contends that the lack of subject matter jurisdiction renders this request, as well as Plaintiffs request for leave to file a second amended complaint, meritless.

1. Subject matter jurisdiction under 42 U.S.C. § 405(g)

In order to determine whether judicial review of a social security disability benefits claim is appropriate, a court must determine first whether a plaintiff has exhausted all of her administrative remedies, and if not, whether a waiver of this requirement is appropriate. See City of New York. 476 U.S. at 483.

A. Exhaustion

Defendant does not contest that the first element of a final decision, a nonwaivable requirement that a claim for benefits be presented to the Commissioner, has been satisfied. Defendant asserts, however, that Plaintiff fails to satisfy the second element, exhaustion of administrative remedies, because the Appeals Council remanded her case on April 3, 2003 to the ALJ, after Plaintiff filed this case. Def.'s Mot. to Dismiss at 2-3. Plaintiff asserts that her administrative remedies have been exhausted by virtue of the Commissioner's failure to render a timely decision on her appeal. Pl.'s Mem. in Supp. of Mot. for Mandamus at 3. Although the Appeals Council's delay in response frustrated Plaintiff, unexhausted administrative recourse remains available to her in the form of the remand pending before the ALJ. The Appeals Council remanded her claim so that additional evidence may be considered, as Plaintiff requested in her April 28, 1999 letter to the Appeals Council. In light of the recent remand, Plaintiff has not exhausted her administrative recourse.

B. Waiver

The exhaustion requirement can be waived by a court only if: 1) the claim for which judicial review is sought is collateral to the claimant's demand for benefits; 2) the claimant has shown that irreparable injury would occur if the exhaustion requirement were maintained; and 3) exhaustion of administrative remedies would be futile. See City of New York, 476 U.S. at 483; see also Johnson. 2 F.3d at 921. Plaintiff asserts that she satisfies the first of the three waiver requirements because the claim presently before the court is collateral to her demand for benefits, but she does not explain how. Pl.'s Mem. in Supp. of Mot. for Mandamus at 2. Even if the relief prayed were construed as procedural, and would not result directly in an award of benefits, a claim may still be found "inextricably intertwined" with a substantive claim for benefits, and thus not wholly collateral, if it "remove[s] from the Secretary's consideration a substantive factor immediately relevant to [Plaintiffs] underlying claim." Hironymous v. Bowen, 800 F.2d 888, 893 (9th Cir. 1986). In the present case, judicial intervention prior to the ALJ's second decision after remand would do just that — remove a "substantive factor" from the Commissioner's consideration of the claim. Thus the first part of the test goes unmet, as the claim presently before the court is collateral to the substantive claim for benefits.

With regard to the second waiver requirement, Plaintiff alleges that she has "suffered irreparable harm in that the ALJ refused to wait as requested by Plaintiff on treating physician [reports] which were received five weeks of [sic] the hearing." Pl.'s Mem. in Supp. of Mot. for Mandamus at 2. However, following the remand to the ALJ, this contention is moot. The Appeals Council directed the ALJ to consider those reports in its April 3, 2003 remand order. Nor did Plaintiff allege hardship on the basis of financial difficulty. Plaintiff has not demonstrated irreparable injury, and thereby fails the second waiver requirement.

Plaintiff further states that she satisfies the third waiver requirement because the Appeals Council's past delay in responding to her request renders the exhaustion requirement futile. While the prior delay of the Appeals Council upset Plaintiff, it does not predict how the ALJ will rule in light of the additional evidence. Plaintiff apparently fears additional delay on the part of the ALJ following remand, noting that the ALJ is "predisposed to delay," Pl.'s Req. for Leave to Withdraw Stipulation at 4, despite Plaintiffs own admission that the ALJ issued a decision within a month of Plaintiff's initial hearing. Compl. ¶ 3. Plaintiff fails to demonstrate how the remand to the ALJ renders the exhaustion requirement futile, leaving all three parts of the waiver test unmet. Accordingly, this court lacks subject matter jurisdiction to review Plaintiffs demand for benefits.

2. Mandamus jurisdiction under the Mandamus and Venue Act of 1961

In the alternative, Plaintiff asserts mandamus jurisdiction under the Mandamus and Venue Act of 1961, which provides that: "[t]he district courts shall have original jurisdiction of any action in the nature of mandamus to compel an officer or employee of the United States or any agency thereof to perform a duty owed to the plaintiff." 28 U.S.C. § 1361. While the Ninth Circuit Court of Appeals found § 1361 to be an "appropriate basis for jurisdiction in an action challenging procedures used in administering social security benefits,"Kildare, 325 F.3d at 1084, citing Johnson, 2 F.3d at 924-25, mandamus can only be used to compel a federal official to perform a duty owed to the claimant if all three parts of the Patel test have been satisfied.

This Court needs not reach the first two parts of thePatel test, since the third, lack of another adequate remedy, has not been met. Plaintiff retains an adequate alternative remedy in the form of the Appeals Council's remand of the matter to the ALJ. As explained in Hironymous. the exhaustion requirement for mandamus jurisdiction parallels that of judicial review under § 405(g): "there is no mandamus jurisdiction where a plaintiff has failed to exhaust his remedy under § 405(g) . . . when § 405(g) review is the exclusive remedy available." 800 F.2d at 893. InHironymous. as here, the administrative scheme "culminating in review under 42 U.S.C. § 405(g) [is] the exclusive avenue for [plaintiff] to present his claims." Id. at 892. Accordingly, this court lacks mandamus jurisdiction to compel a final decision from the Commissioner at this time.

3. Plaintiffs motion to remand under § 405(g), Sentence Six

Plaintiff moved to remand the matter to the Commissioner under sentence six of § 405(g), as explained in Section II supra. However, only the Defendant Commissioner can move for such a remand: "The court may, on motion of the Commissioner of Social Security made for good cause shown before the Commissioner files the Commissioner's answer, remand the case to the Commissioner of Social Security for further action by the Commissioner of Social Security. . . ." 42 U.S.C. § 405(g) (emphasis added). Defendant has not made such a motion. Plaintiff asserts that she, rather than Defendant, may bring this motion by virtue of a "second prong" based on "good cause . . . as shown by new, material evidence." Pl.'s Req. for Leave to Withdraw Stipulation at 2-3. Plaintiff misinterprets the statute. The "good cause" requirement is not a second prong of the remand requirement, but a subordinate clause in the same sentence, as a condition upon the Commissioner's ability to move for such a remand. Moreover, the Appeals Council's remand to the ALJ has the same effect of a sentence six remand. Plaintiffs motion to remand under sentence six is both moot and without merit.

4. Plaintiffs motion for leave to withdraw stipulated dismissal

A district judge has broad discretion in deciding whether to allow a party to amend a pleading, including a voluntary dismissal. Plaintiff seeks leave to withdraw the stipulated dismissal because the "voluntary dismissal prejudices plaintiff possibly in a subsequent request for Equal Access to Justice [Act attorney] fees as well as for requesting continuing jurisdiction by this court under a sentence six remand."Id. at 2. Plaintiff also stated that the Defendant engaged in "sharp practice [by] getting Plaintiffs attorney to stipulate to a voluntary dismissal without informing him of all his potential rights in this case." Id. at 5.

Unless otherwise stated, voluntary dismissal is without prejudice. Fed.R.Civ.P. 41(a)(1). The voluntary dismissal stipulated by the parties did not include a statement as to prejudice, Stipulation and Order Dismissing Compl. at 1-2, and so should be construed as a dismissal without prejudice.² Dismissal without prejudice is not a final adjudication on the merits and does not invoke res judicata. See In re Corey, 892 F.2d 829, 835 (9th Cir. 1989). With respect to attorney's fees, "a federal court may consider collateral issues after an action is no longer pending." Cooter Gell v. Hartmarx Corp., 496 U.S. 384, 394-95, 110 S.Ct. 2447, 2455-56 (1990). Lower courts have interpreted such "collateral issues" to include attorney's fees. See Brown v. Local 58. Int'l Bhd. of Elec Workers, 76 F.3d 762 (6th Cir. 1996). Therefore, Plaintiffs assertion that the dismissal of this claim would operate with prejudice or would automatically preclude attorney's fees is without merit. Moreover, as Defendant correctly notes, absent subject matter jurisdiction, Plaintiffs request for leave to withdraw the stipulation is without any merit or consequence.

2 The stipulation to dismiss was signed by both parties but not by a judge. Stipulation and Order Dismissing Compl. at 1-2. Stipulation has the legal force of a voluntary dismissal without the signature of a judge. See Fed.R.Civ.P. 41(a)(1)(ii).

5. Plaintiffs request for leave to file Second Amended Complaint

Plaintiff seeks to amend her complaint to request "interim benefits relief along with other "such relief as may be proper." Req. for Leave to File Second Amended Compl. at 2. A judge has broad discretion in denying leave to amend where the amendment is futile, or fails to remedy the defect of the initial pleading. See Foman, 371 U.S. at 182 (1962). As discussed above, the Court lacks subject matter jurisdiction over the complaint because Plaintiff has not exhausted her administrative remedies pending the remand to the ALJ. Nothing in Plaintiffs request for leave remedies this flaw; Plaintiffs administrative remedies remain unexhausted. Without subject matter jurisdiction, Plaintiffs request for leave to amend, like her request for leave to withdraw, is without any merit or consequence.

CONCLUSION

Accordingly, Plaintiffs motions for leave to withdraw stipulation for dismissal, for leave to file a second amended complaint, for mandamus, and for judicial review on the merits of the disability benefits claim are DENIED. Defendant's motion to dismiss is GRANTED. [Docket ##1, 6, 11 and 19.]

IT IS SO ORDERED.