Federal District Court Appeals
Overview of the Appeal Process. The administrative process designed by Congress to implement the Social Security Disability claim process is non-adversarial in nature. Richardson v. Perales, 402 U.S. 389, 403 402, 91 S.Ct. 1420, 1428 28 L.Ed.2d 842 (1971) (we bear in mind that the agency operates essentially, and is intended so to do, as an adjudicator and not as an advocate or adversary. This is the congressional plan); Sims v, Apfel 530 U.S. 103, 120 S.Ct. 2080, 147 L.Ed.2d 80 (2000) (Social Security Proceedings are “inquisitorial rather than adversarial”); Cannon v. Harris, 651 F.2d 513, 519 (7th Cir.1981) (hearings to determine whether claimants are entitled to disability benefits are not adversary hearings). Up to this point, the process has been informal and more or less relaxed. The strict rules of evidence have not applied in the administrative case.
However, with the decision of the Appeals Council affirming the denial of the application for disability benefits, a new chapter is about to open. This chapter is litigation in the Federal District Court with local rules and Federal Rules of Civil Procedure (along with deadlines) all strictly applied. Importantly, there is now, for the first time in the case, an opposing counsel.
At the end of fiscal year 2011, 14,236 cases were filed in the United States district courts fro review of Social Security disability denials by the administrative agency. During that same year period, 13,271 cases were decided. 3% resulted in allowances, 9% were dismissed, 46% were remanded and 42% were denied.
This litigation is more docile than the stuff that typically comprises cases normally understood to be full-throated civil litigation (e.g. personal injury, contract disputes, domestic). Social Security Disability appeals in District Court do not contemplate mediation, depositions, direct or cross-examination of witnesses or even the need to meet opposing counsel. There are no evidentiary hearings. There is no trial. The claimant does not meet the judge. On occasion there may be oral arguments on the briefs that have been filed (depending on the discretion of the District Court judge). But oral arguments are rare. Basically, there is the filing of a complaint for review, a briefing schedule entered, briefs submitted and a written court decision with a judgment entered. As simple as the process seems from a 5,000 foot overview, the rules of procedure are technical and lined with traps for the unwary.
When considering whether there are issues on appeal, it is important to remember that the U.S. Supreme Court held in the case of Sims v, Apfel 530 U.S. 103, 120 S.Ct. 2080, 2086, 147 L.Ed.2d 80 (2000) that “[c]laimants who exhaust administrative remedies need not also exhaust issues in a request for review by the Appeals Council in order to preserve judicial review of those issues.” This case stands for the proposition that there is no claim preclusion for failure to raise an issue to the Appeals Council. All issues and errors may be raised at the district court level. Experienced Social Security litigators have developed an intuitive sense that enables them to assess the merits of the case after speaking with the client. That said, the record of the case is paramount. It is only the record that will be before the court. In the final analysis, the two questions to be answered is whether the ALJ committed error and if so was it harmful.
Time Is Critical. Time is normally critical in appealing a case to the U. S. District Court. The claimant has sixty (60) after having received [SSA presumes that the decision has been received five (5) days after the date stamped on the decision] an unfavorable decision from the Appeals Council in which to file an appeal.
Filing Fee. The filing fee in the U. S. District court is $350. It is possible that the court may waive the requirement to pay the filing fee. Those claimants who cannot afford the costs of fling fees may seek such a waiver of filing fees using form AO 239 “Application to Proceed in District Court Without Prepaying Fees or Costs (long Form)” (for the U.S. District Court for the Southern and Northern Districts of Indiana).
Attorney Fees. All district court cases for social security appeals are contingent. Therefore, a written fee agreement signed by the client is necessary under the Indiana Rules of Professional Conduct, Rule 1.5(c). This fee agreement is separate from the fee agreement for the administrative case. All fees for worked performed in the district court are limited to 25% of the past due benefits [See 42 U.S.C. § 406(b)(1)(A)]. If the decision results in an outright award, then a petition for a court order awarding attorney fees will be filed. In making the decision, the court looks at the fee agreement and then tests that fee for reasonableness. [Gisbrecht v. Barnhart, 122 S.Ct. 1817, 1828 (2000).] In the very common situation of a remand (versus an outright award) the case will be sent back to ODAR for further action. If, upon return to the administrative level, a favorable decision is made, the attorney is entitled to return to the district court to make a request for attorney’s fee under the fee agreement. In either case, the attorney will make a request for an award under the Equal Access to Justice Act (28 U.S.C. § 2412(d)).