Jimenez v. Weinberger

• Decision Date: 07 November 1975
• Docket Number: No. 75-1046,75-1046
• Citation: 523 F.2d 689
• Parties: Eugenio and Alicia JIMENEZ, by their father and next friend, Ramon Jimenez, Plaintiffs-Appellees, v. Caspar WEINBERGER, Secretary of Health, Education and Welfare, Defendant-Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 689

523 F.2d 689

Eugenio and Alicia JIMENEZ, by their father and next friend, Ramon Jimenez, Plaintiffs-Appellees, v. Caspar WEINBERGER, Secretary of Health, Education and Welfare, Defendant-Appellant.

No. 75-1046.

United States Court of Appeals, Seventh Circuit.

Argued April 2, 1975.

Decided Sept. 12, 1975.

Rehearing Denied Nov. 7, 1975.

Carla A. Hills, Asst. Atty. Gen., John K. Villa, Atty., Appellate Section, Civ. Div., Dept. of Justice, Washington, D. C., Samuel K. Skinner, U. S. Atty., Gary L. Starkman, Asst. U. S. Atty., Chicago, Ill., for defendant-appellant.

Jane G. Stevens, Chicago, Ill., for plaintiffs-appellees.

Before McALLISTER, Senior Circuit Judge, ^* and STEVENS and SPRECHER, Circuit Judges.

STEVENS, Circuit Judge.

This appeal is a sequel to Jimenez v. Weinberger, 417 U.S. 628, 94 S.Ct. 2496, 41 L.Ed.2d 363, in which the Supreme Court held unconstitutional the portion of the Social Security Act which had provided the basis for the Secretary's denial of plaintiffs' application for benefits. On remand, the district court granted relief to the plaintiffs and to other similarly situated applicants. The Secretary has appealed, questioning (1) whether the district court had the power to certify the case as a class action after a decision on the merits, and (2) if so, whether the award of retroactive relief to the unnamed plaintiffs was proper. Because of the novelty and importance of the issues, we recite the procedural history of the case in some detail.

I

Plaintiffs are the illegitimate children of a disabled wage earner. On August 21, 1969, their father, acting on their behalf, applied for insurance benefits under the Social Security Act. Because plaintiffs were born after the onset of their father's disability, § 216(h)(3)(B) of the Act, 42 U.S.C. § 416(h)(3)(B), required the Secretary to deny their application. ¹ They exhausted their administrative remedies; on June 15, 1971, which was less than 60 days after the final adverse decision of the Secretary, they commenced this action, invoking the jurisdiction of the federal court under 42 U.S.C. § 405(g). ²

The complaint sought both individual and class relief.

The class allegations met the requirements of subparagraph (b)(2) of Fed.R.Civ. 23 rather than subparagraph (b)(3). ³ Plaintiffs prayed for a judgment declaring the statutory exclusion unconstitutional, enjoining the Secretary from denying benefits to plaintiffs or to any other members of the class, and for such other relief as might be appropriate.

The Secretary's answer admitted the facts alleged in the complaint, averred that the statute foreclosed relief, and denied that the case was appropriately brought as a class action. No separate motion directed at the question whether the case should be certified as a class action was filed by either party. The Secretary moved for summary judgment, contending (1) that the case should not be treated as a class action, and (2) that he should prevail on the merits. The plaintiffs filed a cross motion for summary judgment, arguing the converse of both issues. Thereafter, in May 1972 plaintiffs filed a motion to convene a three-judge court pursuant to 28 U.S.C. § 2282. ⁴

The three-judge court was appointed and proceeded to decide the merits, apparently without giving any consideration to the class action issue. In their opinion sustaining the constitutionality of the statute, the majority said nothing about the class action; Jimenez v. Richardson, 353 F.Supp. 1356 (N.D.Ill.1973). In his dissent, however, Circuit Judge Fairchild stated that he would have enjoined enforcement of the statutory exclusion as applied to the unnamed plaintiffs "and others similarly situated." Id. at 1363.

Plaintiffs appealed directly to the Supreme Court pursuant to 28 U.S.C. § 1253. By accepting jurisdiction, that Court implicitly decided that the three-judge court was properly convened, ⁵ and also, again implicitly, that the district court had the power to grant injunctive relief in an action brought under § 405(g) of the Social Security Act. ⁶ The only question formally presented by plaintiffs' appeal was whether the statute was constitutional; at the end of their brief, however, plaintiffs "submitted that the case should be remanded to the district court for consideration of proper relief with respect to restitution for members of the plaintiffs' class." ⁷

On June 19, 1974, the Supreme Court reversed on the merits, vacated the judgment of the district court, and remanded the case "to provide appellants an opportunity, consistent with this opinion, to establish their claim of eligibility as 'children' of the claimant under the Social Security Act." 417 U.S. at 637-638, 94 S.Ct. at 2502. Neither the opinion of the Chief Justice for the Court, nor the dissent of Mr. Justice Rehnquist, made any reference to the class action issue. After the mandate issued, plaintiffs moved for the entry of an order reconvening the three-judge court, certifying the case as a class action, and granting relief to the named as well as the unnamed plaintiffs. The Secretary opposed that motion and filed his own motion for remand to the agency for a final determination of the eligibility of the named plaintiffs. After those motions had been briefed, the plaintiffs filed a separate motion for a ruling on the named plaintiffs' right to relief without further administrative proceedings. Without addressing any other pending issue, on October 21, 1974, the single district judge remanded the case to the Secretary for final disposition within three weeks. The Secretary then found that plaintiffs were eligible for benefits and so advised the district court.

On November 15, 1974, the single district judge entered two orders. In the first, he declared the relevant portion of the statute null and void and ordered the Secretary to pay benefits to the plaintiffs for the period after August 21, 1969, the date of their original application. In the second order, the court directed the Secretary to give notice of the resultant change in the statute

to all those applicants for Social Security benefits who have been denied benefits solely by reason of the provisions of the Act now declared unconstitutional, together with an explanation of how they should proceed in order to obtain the benefits(.)

He further ordered the Secretary

to provide benefits to all those denied benefits since the date of the filing of this action solely by reason of that portion of the Act declared unconstitutional. Such benefits shall cover the period from which said persons would originally have been entitled but for the provisions invalidated herein, and payment of said benefits and ongoing monthly benefits to all eligible persons shall begin forthwith(.)

In support of a motion for reconsideration, which was denied, and a motion for stay pending appeal, which was granted in part, the Secretary added certain factual matter to the record. There are about 7,000 members of the class; their aggregate claims amount to about $5,000,000. Although the Secretary challenges the court's power to order retroactive relief to the unnamed members of the class, he represents that he is now paying them benefits for the period after the date of the Supreme Court decision on June 19, 1974, and that he has paid the named plaintiffs back to the date of their original application, as ordered by the district court. The amount in dispute therefore includes claims which were denied by the Secretary after the litigation commenced on June 15, 1971, and which accrued prior to June 19, 1974.

II

The Supreme Court's recent decision in Weinberger v. Salfi, --- U.S. ---, 95 S.Ct. 2457, 45 L.Ed.2d 522 (1975), reminds us to confront at the outset the question whether the district court had jurisdiction of the class aspects of this litigation. ⁸

As the Court held in Salfi, 42 U.S.C. § 405(g) is the only statute authorizing the district court to grant relief from a denial of benefits under the Social Security Act. The language of the statute confers authority to affirm, modify or reverse a decision of the Secretary, but contains no suggestion that a reviewing court is empowered to enter an injunctive decree whose operation reaches beyond the particular applicants before the Court. 95 S.Ct. 2457, note 8. Nevertheless, as we have already noted, the Court's acceptance of appellate jurisdiction in this very case was a holding, albeit unarticulated, that such jurisdiction does exist. Moreover, if the Court did not believe a class action could ever be maintained under the Social Security Act, there would have been no need to analyze the shortcomings of the particular class which Salfi represented. Unquestionably § 405(g) conferred jurisdiction on the district court to hear a timely claim by each individual member of the class; we think Rule 23 provides a procedure by which such power may be exercised in a single appropriate proceeding. Unnamed, as well as named, plaintiffs are "applicants before the court" in a properly maintained class action.

In the Salfi case, the Court held that § 405(g) did not provide jurisdiction over the claims of the unnamed members of the class because they had not satisfied one of the three statutory requirements for judicial review of an adverse decision by the Secretary, ⁹ specifically, the requirement of a final decision by the Secretary. The complaint was deficient because it did not contain any allegation that those plaintiffs had "even filed an application with the Secretary, much less that he had rendered any decision, final or otherwise, review of which (was) sought."

In this case, although the complaint is somewhat ambiguous, the order of the district court overcomes this objection because it limits the class to "applicants" who have been denied benefits solely by reason of the invalid provisions of the Act. By definition, therefore, in this case the class is limited to persons satisfying the requirement of a...