Torres v. Shalala ( 1995 )

United States Court of Appeals,
Fifth Circuit.
No. 93-9001.
Gabriel G. TORRES, Plaintiff-Appellant,
v.
Donna E. SHALALA, Secretary of Health and Human Services,
Defendant-Appellee.
March 30, 1995.
Appeal from the United States District Court for the Northern
District of Texas.
Before JONES, DUHÉ and STEWART, Circuit Judges.
DUHÉ, Circuit Judge:
Gabriel Torres (Appellant), appeals from the district court's
dismissal of his action for judicial review of the Social Security
Administration's (Secretary) denial of his request for
reconsideration and for a hearing before an Administrative Law
Judge (ALJ) on his application for disability insurance benefits
(DIB). We affirm.
I. BACKGROUND
Appellant sustained gunshot wounds to his left hip and abdomen
in 1969, while serving in the United States Army during the Vietnam
conflict. Immediately after he was wounded, he underwent a series
of operations. Appellant underwent additional hip surgery in 1975,
1979 and 1985. Despite these surgeries, Appellant's left leg
remains approximately 3 cm shorter than his right leg, he has
restricted motion in his lumbar spine and left hip and continues to
suffer pain and discomfort.
1
Appellant was employed, for short periods of time, after
returning from Vietnam. Appellant worked as a hospital orderly in
1973-74, and as a detailer for a car dealer in 1974-75. Appellant
apparently left his job as a detailer in 1975 after sustaining a
fractured hip as a result of an on the job injury.1 There is no
dispute that Appellant has not worked since 1975,2 and that
Appellant was last eligible for disability insurance benefits on
March 31, 1985.3 Therefore, Appellant must show that he was
disabled as of that date. Appellant initially applied for social
security DIB in 1975.4 He was found to be disabled as of November
10, 1976. Appellant received benefits until March 31, 1983, when,
after a review of recent medical evidence, the Secretary determined
Appellant was no longer disabled. Appellant did not appeal this
determination.
Appellant filed his second application for DIB in September
1986. An ALJ held a hearing and determined that Appellant was not
1
The 1975 surgery was apparently necessitated by Appellant's
on the job injury. The record does not clearly disclose what
role Appellant's gunshot wounds played in the cause or extent of
this injury.
2
Appellant apparently enrolled in, but did not complete, a
training program for watch repair and a training program for lens
grinding.
3
Determination of eligibility for DIB has two primary
components. See 42 U.S.C. § 423. Appellant must meet the DIB
earnings requirement set out in 42 U.S.C. § 423(c)(1), and must
be under a disability as defined by 42 U.S.C. § 423(d).
4
Appellant seeks only Title II benefits (disability
insurance), under 42 U.S.C. § 401 et seq. Appellant apparently
does not seek Supplemental Security Income (SSI) benefits under
Title XVI because his veteran's disability benefits place him
above the financial cut-off for SSI.
2
disabled because he could perform sedentary work and had a
favorable vocational profile.5 The written decision of the ALJ
sets forth a detailed review of Appellant's extensive medical
history and complaints. The ALJ concluded "claimant has the
residual functional capacity to perform the full range of sedentary
work.... [therefore,] considering the claimant's residual
functional capacity, age, education, and work experience, he is not
disabled." After considering additional medical evidence, the
Appeals Council denied Appellant's request for review. Appellant
did not seek judicial review of the decision.
Appellant filed his third application for DIB in December
1989, alleging disability onset in 1975. He supported this
application with new medical evidence, including reports from two
doctors delineating the progress of his disability since the 1988
decision. However, as mentioned above, Appellant's insured status
expired on March 31, 1985 and therefore he was required to show
disability prior to that date. Because his date of eligibility
preceded his second application for DIB, the ALJ treated
Appellant's application as a request for reopening of the 1988
decision. The ALJ enlisted the aid of a medical expert, and
forwarded the exhibits from the 1988 record and the new exhibits to
him for evaluation. After reviewing the expert's report, the ALJ
concluded that the new evidence "does not show considerable changes
or progression of the claimant's condition since it was reviewed in
5
The profile was based on Appellant's age, 37, and the fact
that he held a high school equivalency certificate (GED).
3
1988. Therefore, the new evidence is not material and does not
warrant any revision of" the 1988 decision. The ALJ applied res
judicata and dismissed Appellant's request for a hearing.
Appellant then sought judicial review and the matter was
referred to the magistrate judge who concluded the court lacked
jurisdiction because the Secretary denied benefits on res judicata
grounds, and Appellant had failed to raise a colorable
constitutional claim. The district court adopted the findings,
conclusions and recommendations of the magistrate, and dismissed
the action without prejudice. Appellant timely appealed to this
Court.
II. JURISDICTION
The starting point in our analysis must be an examination of
the court's jurisdiction of an appeal from the Secretary's denial
of a request to reopen a denied application for DIB. The statutory
scheme specifically provides for judicial review of the initial
administrative determination. See Califano v. Sanders, 430 U.S.
99, 97 S. Ct. 980, 51 L. Ed. 2d 192 (1977). However, the statute does
not provide for judicial review of the Secretary's denial of a
request to reopen a claim. The Supreme Court has found no
independent jurisdictional foundation which would provide for
review of such denial. See id. at 108-09, 97 S.Ct. at 985-86.
Thus, federal court review of the Secretary's denial of a motion to
reopen a claim lies only where a colorable constitutional question
is at issue. Id. at 109, 97 S.Ct. at 986.
Appellant raises three issues on appeal which he claims
4
constitute colorable constitutional questions. First, Appellant
claims that he was denied due process because the Secretary settled
a class action suit, but limited the application of the settlement
to residents of New York. Second, Appellant contends that the
language of the denial notices he received in conjunction with his
second application violated his right to due process because they
implied that he would have the right to refile an application at
any time regardless of whether he appealed the Secretary's denial
of his application. Finally, Appellant contends that the use of
res judicata violated his right to due process. We shall address
these arguments seriatim.
III. THE STIEBERGER SETTLEMENT
Appellant's first argument is that he was denied due process
because the Secretary has treated him differently than similarly
situated residents of New York. This disparity in treatment
allegedly arose as a result of the Secretary's settlement of
Stieberger v. Sullivan.6 In compromise of the Stieberger
litigation, the Secretary agreed to reopen and review de novo the
previously denied applications for Social Security benefits of a
class defined as:
All New York residents whose claims for benefits or
continuation of benefits have been, or will be denied or
terminated since October 1, 1981, based on a determination
that they do not have a disability that prevents them from
6
The district court's decisions on motions for summary
judgment in this matter are reported at 615 F. Supp. 1315
(S.D.N.Y.1985) and 738 F. Supp. 716 (S.D.N.Y.1990). The
settlement agreement at issue is reported at 792 F. Supp. 1376
(S.D.N.Y.1992) and modified in part at 801 F. Supp. 1079
(S.D.N.Y.1992).
5
engaging in substantial gainful activity and whose benefits
have not been granted or restored through subsequent appeals.
Stieberger, 792 F. Supp. at 1377. Appellant alleges, and Appellee
conceded at oral argument, that Torres satisfies all of the
criteria for class membership except New York residency.
It is long settled that although the Fifth Amendment does not
contain a counterpart to the Fourteenth Amendment's right to equal
protection, "equal protection" and "due process" are not mutually
exclusive. Therefore, a discriminatory application of law by the
federal government, where unjustifiable, can constitute a denial of
due process. See Bolling v. Sharpe, 347 U.S. 497, 498-99, 74 S. Ct.
693, 694, 98 L. Ed. 884 (1954); United States R.R. Retirement Bd.
v. Fritz, 449 U.S. 166, 173 n. 8, 101 S. Ct. 453, 458 n. 8, 66
L. Ed. 2d 368 (1980),
Although "the Fifth Amendment contains no equal protection
clause, it does forbid discrimination that is "so
unjustifiable as to be violative of due process.' " Thus, if
a federal statute is valid under the equal protection
component of the Fifth Amendment, it is perforce valid under
the Due Process Clause of that Amendment.
(citations omitted). We employ the same test to evaluate the
alleged violation of the equal protection component of the Fifth
Amendment as we would to evaluate an alleged violation of the
Fourteenth Amendment's Equal Protection Clause. See e.g., Bowen v.
Gilliard, 483 U.S. 587, 598-601, 107 S. Ct. 3008, 3015-17, 97
L. Ed. 2d 485 (1987). Generally, unless governmental classifications
affect a fundamental right, they need only "bear a rational
relation to a legitimate governmental purpose." See Regan v.
Taxation With Representation, 461 U.S. 540, 547, 103 S. Ct. 1997,
6
2001, 76 L. Ed. 2d 129 (1983). The parameters of "rational basis"
review are well settled.
In the area of economics and social welfare, a State does not
violate the Equal Protection Clause merely because the
classifications made by its laws are imperfect. If the
classification has some "reasonable basis," it does not offend
the Constitution simply because the classification "is not
made with mathematical nicety or because in practice it
results in some inequality." "The problems of government are
practical ones and may justify, if they do not require, rough
accommodations—illogical, it may be, and unscientific." "A
statutory discrimination will not be set aside if any state of
facts reasonably may be conceived to justify it."
Dandridge v. Williams, 397 U.S. 471, 485, 90 S. Ct. 1153, 1161, 25
L. Ed. 2d 491 (1970).
In the present case, the rational basis for the settlement's
geographic limitation is clear.7 The settlement was intended to
recompense only those persons who had been harmed. The Stieberger
plaintiffs contended they suffered harm from certain policies of
the Secretary. However, actual harm occurred because of the way
those policies were implemented. Because the improper
implementation of the policies was geographically limited, the
settlement was also geographically limited.
Specifically, the original Stieberger plaintiffs, Theresa
7
Appellant cites Califano v. Yamasaki, 442 U.S. 682, 99
S. Ct. 2545, 61 L. Ed. 2d 176 (1979) for the proposition that class
actions involving governmental policy should be nationwide in
scope. We do not read Yamasaki for that proposition, and, in
fact, note that the Supreme Court advised federal courts to
exercise caution before certifying a nationwide class. See id.
at 702, 99 S.Ct. at 2558 ("[A] federal court when asked to
certify a nationwide class should take care to ensure that
nationwide relief is indeed appropriate in the case before it,
and that certification of such a class would not improperly
interfere with the litigation of similar issues in other judicial
districts.").
7
Stieberger and the City of New York,
challenge[d] two policies implemented by the United States
Department of Health and Human Services ("HHS") and the Social
Security Administration ("SSA"): "non-acquiescence" and
"Bellmon Review." "Non-acquiescence" is the agency's alleged
policy of adjudicating claims without implementing the
holdings in decisions of United States Court of Appeal.
Bellmon review is the agency's policy pursuant to which the
decisions of Administrative Law Judges ("ALJs"), who had
rendered a high percentage of pro-claimant determinations in
disability benefits cases, were subject to agency-initiated
review. Plaintiffs mov[ed] for full summary judgment but
address[ed] only the non-acquiescence issue on the theory that
they would be entitled to the same relief if they prevailed on
one or both issues.
Stieberger v. Sullivan, 738 F. Supp. at 722. The Stieberger
plaintiffs alleged non-acquiescence in thirteen Second Circuit
holdings. The district court found that the policy of
non-acquiescence was unlawful, but granted summary judgment in only
four of the thirteen claims. Summary judgment on three other
claims was denied without prejudice, and summary judgment was
denied with prejudice on the final six claims. See id. at 758-59.
The Secretary elected to settle the matter rather than proceeding
to trial on the remaining claims.
As stated previously, the Stieberger class suffered harm as a
result of the implementation of the policies, not as a result of
the policies themselves. In other words, the district court found
harm only where a specific Second Circuit precedent was not
applied. The settlement agreement was intended to compensate
persons who were harmed because of the Secretary's failure to
correctly apply these Second Circuit precedents. Therefore,
assuming, ad arguendo, that non-acquiescence is unlawful, to prove
a violation of due process Appellant must show that he, like the
8
Stieberger class, was harmed by the Secretary's failure to apply
Second Circuit precedent. Because Second Circuit precedent is not
binding in this jurisdiction, Appellant can show no harm. In fact,
Appellant fails to show non-acquiescence in any relevant
precedent,8 and therefore fails to show any due process violation
resulting from his exclusion from the settlement agreement.
Appellant also argues that the scope of the settlement is
broader than the alleged harm because the right to reopen was not
specifically limited to those persons whose claims were denied as
a result of the Secretary's non-acquiescence. Therefore, Appellant
contends that the settlement lacks a rational relationship to the
harm alleged. Appellant's argument assumes too much. We must bear
in mind that, as stated by the district court, the settlement is a
compromise intended to establish
"a reasonable balance, especially bearing in mind the length
of time that would elapse, absent a settlement, before any
concrete benefits could be delivered to any class member and
the costs and complexity of implementing a settlement which
followed literally the contours of the Court's liability
determinations."
Stieberger v. Sullivan, 792 F. Supp. at 1377 (emphasis supplied).
While there may not be a one-to-one relationship between the harm
suffered and the relief provided, it cannot be said that the scope
of the settlement and the harm are not rationally related.
The fact that the Secretary found it more efficient to offer
relief to a broad group of applicants rather than attempt to find
8
In our only case on point, we found the evidence
insufficient to show the Secretary was disregarding our
precedents. See Floyd v. Bowen, 833 F.2d 529 (5th Cir.1987).
9
a method to discern which applicants had been actually harmed by
the Secretary's non-acquiescence is of no moment to our analysis.
The terms of the settlement agreement make clear that the purpose
behind reopening the applications is to ensure that the Secretary
properly applied Second Circuit precedent in evaluating the
claims.9 In other words, unless the applicant was in fact harmed
by the failure to apply Second Circuit precedent, the Secretary
will conclude that benefits were properly denied, and the applicant
will gain absolutely no advantage from the relief provided by the
settlement agreement. The terms of the settlement clearly bear a
rational relationship to the harm alleged.
In summary, the plaintiffs in Stieberger demonstrated harm by
proving to the satisfaction of the district court that the
Secretary had engaged in non-acquiescence as to certain Second
Circuit precedents. The Secretary chose to compromise the
litigation rather than allowing the court to fashion a remedy.
Because the harm proved was limited geographically, so also were
the terms of the settlement geographically limited.10 The
geographic distinction is rationally based, and Appellant can show
no violation of due process.
IV. NOTICE
9
This purpose is further evidenced by the fact that persons
whose claims have been judicially reviewed are not entitled to
have their claims reopened except in one limited circumstance.
See Stieberger v. Sullivan, 801 F. Supp. at 1089.
10
See Valtsakis v. Commissioner, 801 F.2d 622, 624 (2nd
Cir.1986) ("The existence of divergent results in different
circuits ... does not amount to a violation of equal
protection.").
10
Appellant next urges us to follow the Ninth Circuit's holding
in Gonzalez v. Sullivan.11 In Gonzalez, the court found that the
applicant had been denied his right to due process because of
certain language in the Secretary's notice of adverse decision.
Specifically, the notice stated,
If you believe that this determination is not correct,
you may request that your case be reexamined. If you want
this reconsideration, you must request it not later than 60
days from the date you receive this notice. You may make your
request through any social security office. If additional
evidence is available, you should submit it with your request.
Please read the enclosed leaflet for a full explanation of
your right to question the determination made on your claim.
If you do not request reconsideration of your case within
the prescribed time period, you still have the right to file
another application at any time.
Id. at 1203 (emphasis added). The Ninth Circuit determined that
the underscored language mislead the applicant because it did "not
clearly indicate that if no request for reconsideration is made,
the determination is final." Id. The court found that the notice
thereby violated the applicant's Fifth Amendment right to due
process.
There is no dispute that, in conjunction with his second
application for DIB, Appellant received a total of four adverse
determination notices during various stages of the administrative
process. The first two notices contained language identical to
that found unconstitutional in Gonzalez. However, unlike the
applicant in Gonzalez, Appellant continued through the
administrative process. After receiving the first notice,
11
914 F.2d 1197 (9th Cir.1990).
11
Appellant filed a request for reconsideration. After the second
notice, Appellant again exercised his right to appeal and requested
a hearing on his application.
After hearing, Plaintiff received the third notice of the
denial of his application. This notice, however, did not contain
the language complained of in Gonzalez, but explicitly set out the
process by which Appellant could ask for discretionary review by
the Appeals Council. Appellant followed this process. Finally,
Appellant was notified of the Appeals Council's denial of his
request for review. Again, the notice explicitly set out the
process by which Appellant could obtain judicial review of the
denial of his application, but contained none of the language found
unconstitutional in Gonzalez.
Whether the language contained in the first two notices
violated due process is a matter of first impression in this
Circuit. However, we need not reach this issue because we find
that Appellant lacks standing to raise the due process claim. As
set out recently by the Tenth Circuit, to show standing to raise a
constitutional claim:
First, the plaintiff must have suffered an invasion of a
legally-protected interest that is "concrete and
particularized," and "actual or imminent," not "conjectural or
hypothetical." Second, there must be a causal connection
between the injury and the complained of conduct; that is,
the injury must be "fairly ... trace[able] to the challenged
action of the defendant, and not ... th[e] result [of] the
independent action of some third party not before the court.'
"
Gilbert v. Shalala, 45 F.3d 1391, 1393 (10th Cir.1995) (quoting
Lujan v. Defenders of Wildlife, 504 U.S. 555, 112 S. Ct. 2130, 119
12
L. Ed. 2d 351 (1992)). Appellant has not shown any causal connection
between the allegedly misleading language in the first two notices
and his subsequent failure to seek judicial review. Appellant
continued to appeal his denial of benefits, and did not stop until
he reached the end of the administrative process.
To satisfy the causal connection requirement of Defenders of
Wildlife, Appellant must show that he relied on the challenged
language in the first two notices. See Gilbert v. Shalala at 1394;
Day v. Shalala, 23 F.3d 1052, 1066 (6th Cir.1994); Burks-Marshall
v. Shalala, 7 F.3d 1346, 1349 (8th Cir.1993). Appellant's claim
that he may have sought judicial review but for the language in the
first two notices is simply too attenuated to satisfy the causal
connection requirement. Appellant exercised his right to appeal
despite the language in the first two notices, and chose not to
seek judicial review despite the fourth notice's detailed
instructions. Appellant's retrospective speculation is
insufficient to create standing.
V. SUFFICIENCY OF THE RECORD
In his final constitutional claim, Appellant contends that
application of res judicata to his December 1989 application for
DIB violated due process for two reasons. First, Appellant
contends that the 1989 application and the 1986 decision lack
factual identity. Second, Appellant contends that the 1986 record
was constitutionally inadequate to support the application of res
judicata because the recording of the 1986 hearing was lost. These
arguments are easily disposed.
13
Appellant's first argument represents a misapprehension of
the doctrine of res judicata. If simply submitting new evidence
rendered a prior decision factually distinct, res judicata would
cease to exist, and the application process would continue ad
infinitum. Appellant filed a new claim on the same medical
problems, with the same onset date and alleging the same
disability. The submission of additional medical reports to show
a degeneration of his condition does not transform the application
of res judicata into a violation of due process.12
Appellant's second argument is equally misplaced. In the
primary case relied on by the Appellant, the Ninth Circuit
determined that res judicata had been improperly applied where the
record was "patently inadequate to support the findings [of] the
ALJ." Thompson v. Schweiker, 665 F.2d 936, 941 (9th Cir.1982). In
this case, there is no claim that the record is patently
inadequate. Only the tape recording of the hearing was lost. The
ALJ had the full benefit of all of the exhibits from the previous
hearing, as well as new exhibits and testimony from the Appellant.
In this case, Appellant has not demonstrated that loss of the
recording affected the ability of the ALJ to render an informed
decision, and no violation of due process has been proven.13
12
In addition, as discussed above, Appellant's insured
status expired as of March 31, 1985. Evidence showing the
degeneration of his condition after that date was not relevant to
the Secretary's analysis.
13
See, e.g., Cottrell v. Sullivan, 987 F.2d 342, 345 (6th
Cir.1992) (per curiam) ("[T]here is no constitutional requirement
that the Appeals Council have a complete transcript before
deciding whether to grant an application to reopen.").
14
VI. CONCLUSION
Appellant has failed to raise a colorable constitutional
claim, and therefore we are without jurisdiction to address his
arguments on the merits of the denial to reopen. The decision of
the district court is AFFIRMED.
15