Craig Tobeler v. Carolyn W. Colvin , 749 F.3d 830 ( 2014 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
CRAIG DOUGLAS TOBELER, No. 12-16392
Plaintiff-Appellant,
D.C. No.
v. 3:09-cv-00309-
ECR-RAM
CAROLYN W. COLVIN,
Defendant-Appellee. OPINION
Appeal from the United States District Court
for the District of Nevada
Edward C. Reed, Jr., District Judge, Presiding
Argued and Submitted
March 14, 2014—San Francisco, California
Filed April 18, 2014
Before: Raymond C. Fisher and Marsha S. Berzon, Circuit
Judges, and Gordon J. Quist, District Judge.*
Opinion by Judge Fisher
*
The Honorable Gordon J. Quist, Senior United States District Judge for
the Western District of Michigan, sitting by designation.
2 TOBELER V. COLVIN
SUMMARY**
Equal Access to Justice Act / Attorney’s Fees
The panel reversed the district court’s order denying a
claimant’s motion for attorney’s fees under the Equal Access
to Justice Act.
The panel held that the underlying federal agency action
lacked a reasonable basis in law because the Social Security
administrative law judge disregarded competent lay witness
evidence without comment. The panel also held that the
position of the United States in the underlying action was not
substantially justified, and the claimant was entitled to an
award of attorney’s fees. The panel held that a fee award was
appropriate even if the government’s litigation position may
have been justified because the government’s underlying
position was not substantially justified.
COUNSEL
Linda S. Ziskin (argued), Lake Oswego, Oregon; John C.
Boyden and John A. Aberasturi, Erickson, Thorpe &
Swainston, Ltd., Reno, Nevada, for Plaintiff-Appellant.
**
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
TOBELER V. COLVIN 3
Elizabeth Barry (argued), Special Assistant United States
Attorney, Daniel G. Bogden, United States Attorney, Donna
L. Calvert, Acting Regional Chief Counsel, Social Security
Administration, San Francisco, California, for Defendant-
Appellee.
OPINION
FISHER, Circuit Judge:
Craig Tobeler appeals the district court’s order denying
his motion for attorney’s fees under the Equal Access to
Justice Act (EAJA). We have jurisdiction under 28 U.S.C.
§ 1291, we review for an abuse of discretion, see Meier v.
Colvin, 727 F.3d 867, 869–70 (9th Cir. 2013), and we
reverse.
“EAJA provides that ‘a court shall award to a prevailing
party other than the United States fees and other expenses . . .
incurred by that party in any civil action . . . unless the court
finds that the position of the United States was substantially
justified or that special circumstances make an award
unjust.’” Meier, 727 F.3d at 870 (quoting 28 U.S.C.
§ 2412(d)(1)(A)). “It is the government’s burden to show
that its position was substantially justified.” Id. (citing
Gutierrez v. Barnhart, 274 F.3d 1255, 1258 (9th Cir. 2001)).
“Substantial justification means ‘justified in substance or in
the main – that is, justified to a degree that could satisfy a
reasonable person.’” Id. (quoting Pierce v. Underwood, 487
U.S. 552, 565 (1988)) (internal quotation marks omitted).
“Put differently, the government’s position must have a
‘reasonable basis both in law and fact.’” Id. (quoting Pierce,
487 U.S. at 565). “The ‘position of the United States’
4 TOBELER V. COLVIN
includes both the government’s litigation position and the
underlying agency action giving rise to the civil action.” Id.
Thus, if “the government’s underlying position was not
substantially justified, we [must award fees and] need not
address whether the government’s litigation position was
justified.” Id. at 872.
Here, the underlying agency action lacked a reasonable
basis in law because the administrative law judge (ALJ)
disregarded competent lay witness evidence on Tobeler’s
symptoms without comment. Under our case law, “[l]ay
testimony as to a claimant’s symptoms is competent evidence
that an ALJ must take into account, unless he or she expressly
determines to disregard such testimony and gives reasons
germane to each witness for doing so.” Lewis v. Apfel, 236
F.3d 503, 511 (9th Cir. 2001); accord Stout v. Comm’r, Soc.
Sec. Admin., 454 F.3d 1050, 1053 (9th Cir. 2006).
Disregarding competent lay witness testimony without
comment, therefore, constitutes “legal error[],” and it
“deprive[s] the Commissioner of substantial justification.”
Sampson v. Chater, 103 F.3d 918, 922 (9th Cir. 1996); see
also Li v. Keisler, 505 F.3d 913, 920–21 (9th Cir. 2007)
(explaining that an agency’s decision lacks substantial
justification when it is “contrary to clearly established law”).
Noting that our case law requiring a reasoned explanation
for rejecting lay witness evidence applies solely to competent
evidence, the government contends that the evidence at issue
here was irrelevant, and hence, that the ALJ would have been
substantially justified in treating it as incompetent. We
disagree.
First, the ALJ would not have been substantially justified
in treating the evidence as irrelevant. Tobeler’s friend and
TOBELER V. COLVIN 5
former employer, George Bandy, submitted a letter
describing Tobeler’s inability to handle work as a floor
installer during three periods of employment in the early
1980s, 2001 and 2003. Although the government maintains
that this evidence was irrelevant to whether Tobeler was
capable of working during the relevant period between
January 1 and September 30, 1999, it offers no legal support
for that contention. Evidence is relevant when it has “any
tendency to make a fact more or less probable than it would
be without the evidence.” Fed. R. Evid. 401(a). Bandy’s
statement that Tobeler was incapable of working in 2001 is
relevant to his ability to work in 1999, at least in the absence
of any evidence that Tobeler’s condition worsened between
1999 and 2001. See Lingenfelter v. Astrue, 504 F.3d 1028,
1036–37 (9th Cir. 2007) (claimant’s failed attempt to work in
1999 relevant to his ability to work during the relevant time
period between 1993 and June 1998); cf. Lester v. Chater, 81
F.3d 821, 832 (9th Cir. 1995) (“[M]edical evaluations made
after the expiration of a claimant’s insured status are relevant
to an evaluation of the pre-expiration condition.” (quoting
Smith v. Bowen, 849 F.2d 1222, 1225 (9th Cir. 1988))).
Kimberli Tobeler, Tobeler’s wife, submitted a detailed
statement describing Tobeler’s problems with depression,
anxiety and anger and contrasting Tobeler’s condition before
and after the onset of his disability. The government argues
that Mrs. Tobeler’s statements are irrelevant because she
completed the questionnaire in 2006, not in 1999. There is no
reason to assume, however, that Mrs. Tobeler was describing
Tobeler’s limitations solely in 2006, rather than throughout
his period of disability. Furthermore, in the absence of any
indication that Tobeler’s condition worsened between 1999
and 2006, we do not see why his condition in 2006 would not
be at least minimally relevant to his condition in 1999.
6 TOBELER V. COLVIN
Finally, to the extent that Mrs. Tobeler’s statement was vague
as to time, it was within the power of the ALJ to clarify the
record. See Tonapetyan v. Halter, 242 F.3d 1144, 1150 (9th
Cir. 2001). We note that Mrs. Tobeler provided her
information by completing a form created by the Social
Security Administration – Form SSA-3380-BK. Mrs.
Tobeler should not be faulted for failing to provide details as
to time that the form did not ask her to provide.
Second, even if the lay witness evidence could be
considered irrelevant, the ALJ was not substantially justified
in disregarding it without comment. Our case law is clear
that the ALJ must provide germane reasons for rejecting
competent lay witness evidence, and relevance and
competence are not the same thing. Under our case law, lay
witness testimony is “incompetent” when it consists of a
medical diagnosis, because “medical diagnoses are beyond
the competence of lay witnesses” to make. Nguyen v. Chater,
100 F.3d 1462, 1467 (9th Cir. 1996). But “lay witness
testimony as to a claimant’s symptoms or how an impairment
affects ability to work is competent evidence and therefore
cannot be disregarded without comment.” Id. (citations
omitted). The evidence provided by Bandy and Mrs. Tobeler
was plainly competent, see Dodrill v. Shalala, 12 F.3d 915,
918–19 (9th Cir. 1993) (“[F]riends and family members in a
position to observe a claimant’s symptoms and daily
activities are competent to testify as to her condition.”);
Sprague v. Bowen, 812 F.2d 1226, 1232 (9th Cir. 1987)
(“Descriptions by friends and family members in a position
to observe a claimant’s symptoms and daily activities have
routinely been treated as competent evidence.”), and therefore
could not be disregarded without comment, regardless of its
relevance.
TOBELER V. COLVIN 7
The government’s reliance on Vincent ex rel. Vincent v.
Heckler, 739 F.2d 1393, 1394–95 (9th Cir. 1984) (per
curiam), is misplaced. Although we held in Vincent that the
ALJ did not err by ignoring lay witness evidence without
comment, the lay witnesses at issue there had made medical
diagnoses – diagnoses that they were not competent to make.
See Nguyen, 100 F.3d at 1467. We explicitly limited Vincent
in Nguyen, where we made clear that lay witness testimony
as to a claimant’s symptoms or how an impairment affects
ability to work is competent evidence that cannot be
disregarded without comment. See id.
Because the ALJ disregarded competent lay witness
evidence without comment, the position of the United States
in the underlying action was not substantially justified. See
Li, 505 F.3d at 920–21; Sampson, 103 F.3d at 922. Tobeler
is therefore entitled to an award of attorney’s fees.
The government points out that its litigation position was
substantially justified because it reasonably argued in the
district court that the ALJ’s error was harmless under Molina
v. Astrue, 674 F.3d 1104, 1122 (9th Cir. 2012). To avoid an
award of EAJA fees, however, the government must show
that its position was substantially justified at each stage of the
proceedings. See Meier, 727 F.3d at 872; Li, 505 F.3d at 919
(“[W]e have consistently held that regardless of the
government’s conduct in the federal court proceedings,
unreasonable agency action at any level entitles the litigant to
EAJA fees.”). Because the government’s underlying position
was not substantially justified, we award fees, even if the
government’s litigation position may have been justified.
The district court concluded that the government’s
position was substantially justified because, “[w]hile Plaintiff
8 TOBELER V. COLVIN
prevailed on the issue of lay witness testimony, the remainder
of the ALJ’s conclusions were affirmed.” This rationale
conflicts with our case law, which requires us to award fees
when “the Secretary’s position on the . . . issues that led to
remand was not substantially justified.” Flores v. Shalala, 49
F.3d 562, 564 (9th Cir. 1995) (emphasis added). As we
explained in Flores:
We conclude that we may resolve the question
of Flores’ entitlement to attorney’s fees by
considering only the procedural issues on
which the district court reversed –
specifically, the Secretary’s failure to take
into account the vocational report discussing
the claimant’s cognitive limitations. In this
case, we need not consider the Secretary’s
position on any other questions, including the
ultimate issue of disability.
Id. at 566; see also Lewis v. Barnhart, 281 F.3d 1081, 1083
(9th Cir. 2002) (“Under the Act, attorneys’ fees are to be
awarded to a party winning a . . . remand unless the
Commissioner shows that his position with respect to the
issue on which the district court based its remand was
‘substantially justified.’” (citing Flores, 49 F.3d at 568–69)).1
1
Like this case, Flores involved a mixed result in the district court. The
district court affirmed the ALJ on one issue (sustaining the ALJ’s
determination that the claimant was not disabled at step two in the familiar
five-step sequential process) but remanded on a second issue (holding that
the ALJ had improperly failed to account for the claimant’s cognitive
limitations, both in the hypothetical question posed to the vocational
expert and in the ALJ’s ultimate disability decision). See Flores, 49 F.3d
at 565. In determining that the government’s position was not
substantially justified, we focused exclusively on “whether the Secretary
TOBELER V. COLVIN 9
This principle accords with “the policy goal of EAJA,” which
“is to encourage litigants to vindicate their rights where any
level of the adjudicating agency has made some error in law
or fact and has thereby forced the litigant to seek relief from
a federal court.” Li, 505 F.3d at 919. The issue that led to
remand here was the ALJ’s disregard of competent lay
witness testimony without comment, and the government’s
position on that issue was not substantially justified. Tobeler
is therefore entitled to an award of fees.
We conclude that the district court abused its discretion
by finding the position of the United States substantially
justified. We therefore reverse the order denying Tobeler’s
motion for EAJA fees. Because the parties dispute the
amount of the award, we remand for an award of fees to be
determined by the district court.
REVERSED AND REMANDED.
was substantially justified with respect to the procedural issue on which
Flores prevailed in district court.” Id. at 566.