Babcock v. Comm'r of Soc. Sec.

• Decision Date: 11 May 2020
• Docket Number: No. 19-1687,19-1687
• Parties: David Bryon BABCOCK, Plaintiff-Appellant, v. COMMISSIONER OF SOCIAL SECURITY, Defendant-Appellee.
• Court: U.S. Court of Appeals — Sixth Circuit

959 F.3d 210

David Bryon BABCOCK, Plaintiff-Appellant,

v.COMMISSIONER OF SOCIAL SECURITY, Defendant-Appellee.

No. 19-1687

United States Court of Appeals, Sixth Circuit.

Argued: March 10, 2020

Decided and Filed: May 11, 2020

ARGUED: Nicholas A. Kipa, BAHRIE LAW, PLLC, Lansing, Michigan, for Appellant. Sushma Soni, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellee. ON BRIEF: Nicholas A. Kipa, BAHRIE LAW, PLLC, Lansing, Michigan, for Appellant. Sushma Soni, Alisa B. Klein, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellee.

Before: COLE, Chief Judge; BOGGS and SUTTON, Circuit Judges.

COLE, Chief Judge.

This case asks us to decide whether a federal civil-service pension based on work as a National Guard dual-status technician qualifies as "a payment based wholly on service as a member of a uniformed service" under the Social Security Act. We agree with the district court that it does not.

I.

Plaintiff-Appellant David Babcock joined the Michigan National Guard in 1970 as an enlisted soldier. After serving for three-and-a-half years, Babcock went to flight school, received his pilot license and, in 1975, became employed as a National Guard dual-status technician. He worked in that position for over 33 years.

By statute, a National Guard dual-status technician "is a Federal civilian employee" who "is assigned to a civilian position as a technician" while maintaining membership in the National Guard. 10 U.S.C. § 10216(a)(1) ; see also 32 U.S.C. § 709(e) (providing that National Guard dual-status technicians are employees of both the United States and either the Department of the Army or the Department of the Air Force). These technicians are responsible for "the organizing, administering, instructing, or training of the National Guard" or "the maintenance and repair of supplies issued to the National Guard or the armed forces." 32 U.S.C. § 709(a)(1)–(2) ; accord 10 U.S.C. § 10216(a)(1)(C). Babcock, for his part, served in various roles as a test pilot and pilot instructor for the Michigan National Guard. Additionally, as is required of all dual-status technicians, Babcock held the appropriate military grade for his position, wore a uniform that displayed his rank and unit insignia while working, and attended weekend drills. See 32 U.S.C. § 709(b) ; see also id. § 502(a) (requiring National Guard members to complete certain drills and training). Dual-status technicians may also be required to support operations or missions undertaken by their units. See 32 U.S.C. § 709(a)(3)(A). Indeed, for a period between 2004 and 2005, Babcock was deployed to Iraq on active duty.

Babcock received military pay for his active-duty service in Iraq and his inactive-duty training, including weekend drills. See generally 37 U.S.C. §§ 204(a), 206 (military pay provisions). But otherwise, he received civil pay and participated in the Civil Service Retirement System ("CSRS"). See generally 5 U.S.C. §§ 5301 et seq . (describing the federal civil pay system); id. § 8332(b)(6) (providing that employment as a dual-status technician is eligible for the CSRS). In accordance with the Social Security Act, Babcock paid Social Security taxes on the wages for his active-duty service in Iraq and for his inactive-duty training from 1988 onwards. See 42 U.S.C. § 410(l)(1). He did not pay Social Security taxes on his wages for inactive-duty training before 1988 or on his civil-service wages. See id. ; see also id. § 410(a)(5).

Babcock retired from his position as a dual-status technician on January 31, 2009. At the time, he was classified as a grade 13, step 10, Aircraft Flight Instructor. Upon his retirement, he began receiving monthly CSRS payments from the Office of Personnel Management ("OPM"). He also began receiving separate military retirement pay from the Defense Finance and Accounting Service ("DFAS"). For several years after his retirement from his role as a dual-status technician, Babcock flew medical-evacuation helicopters for hospitals. His income from this private-sector employment was subject to Social Security taxes. Babcock fully retired in 2014.

On September 30, 2014, Babcock applied for Social Security retirement benefits. On his application, he confirmed that he was receiving monthly CSRS payments. The Social Security Administration ("SSA") granted Babcock's application but reduced his benefits under the Windfall Elimination Provision of the Social Security Act ("WEP") because of his CSRS pension. See 42 U.S.C. § 415(a)(7)(A). Babcock asked the SSA to reconsider its decision, citing an exception to the WEP for payments "based wholly on service as a member of a uniformed service." See id. § 415(a)(7)(A)(III). Babcock argued that this uniformed-services exception applied to his CSRS pension based on his work as a dual-status technician.

At the time, the only federal court of appeals to have addressed the applicability of the uniformed-services exception to a dual-status technician's CSRS pension was the Eighth Circuit. According to the Eighth Circuit, the text of the exception imposes only the "limited" requirement that "service be as a member of the uniformed service." Petersen v. Astrue , 633 F.3d 633, 637 (8th Cir. 2011). The Eighth Circuit held that service as a dual-status technician meets this requirement, and therefore, the uniformed-services exception unambiguously applies to a pension based on service as a dual-status technician. Id. at 637–38.

In response to the Petersen decision, the SSA issued Acquiescence Ruling ("AR") 12-1(8) to explain how it would apply the WEP and the uniformed-services exception for claimants residing within the Eighth Circuit. See 77 Fed. Reg. 51,842 (Aug. 27, 2012). Under AR 12-1(8), the WEP does not apply when a claimant receives a federal pension based wholly on employment as a dual-status technician for the National Guard; the claimant resides in a state within the Eighth Circuit; and the agency makes a benefits determination after February 3, 2011, the date of the Petersen decision. See id. at 51,842 –43. For claimants residing outside of the Eighth Circuit, however, the WEP would continue to apply if the claimant receives a federal pension based on employment as a dual-status technician. See id. Accordingly, because Babcock was not a resident of the Eighth Circuit, the SSA refused to alter its initial determination that the WEP applied to Babcock's Social Security retirement benefits. An administrative law judge ("ALJ") upheld the SSA's determination, and the Appeals Council affirmed the ALJ's decision.

Babcock then sought judicial review by filing suit against the Commissioner of Social Security in the United States District Court for the Western District of Michigan. While his case was pending before the district court, the Eleventh Circuit decided Martin v. Social Security Administration, Commissioner , in which it rejected the Eighth Circuit's analysis and held that the uniformed-services exception does not apply to dual-status technicians. 903 F.3d 1154, 1168 (11th Cir. 2018) (per curiam). Focusing on the words "wholly" and "as" in the text of the statute, the Eleventh Circuit concluded that "even if dual status technician employment is essentially military, it is not subject to the uniformed services exception if it is not wholly military in nature." Id. at 1166 (emphasis in original). Finding it "difficult to conclude that a dual status technician wholly performs that role as a member of the National Guard," the Eleventh Circuit decided that the Commissioner had the more persuasive reading of the statute. See id. at 1166, 1168.

Faced with both the Petersen and Martin decisions, the district court concluded that the Eleventh Circuit's analysis in Martin was "more persuasive than the Petersen court's analysis" and was "based on the correct application of the language of the exception," and thus, the uniformed-services exception was inapplicable (and the WEP applied) in Babcock's case. Babcock v. Comm'r of Soc. Sec. , 2019 WL 2205712, at *2 (W.D. Mich. May 22, 2019). The district court also rejected Babcock's claim that his rights to due process and equal protection were violated because the WEP applied differently to claimants within the Eighth Circuit. Id. at *3. The district court accordingly entered judgment in favor of the Commissioner, and this timely appeal followed.

II.

We review the district court's decision de novo. Valley v. Comm'r of Soc. Sec. , 427 F.3d 388, 390 (6th Cir. 2005). Because our review involves interpreting a statute that the Commissioner has authority to administer, 42 U.S.C. § 405(a), we start by asking "whether Congress has directly spoken to the precise question at issue." See Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, Inc. , 467 U.S. 837, 842, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). If we can ascertain "the unambiguously expressed intent of Congress," the inquiry ends, and we must give effect to Congress's unambiguous construction of the statute. Id. at 842–43, 104 S.Ct. 2778 ; accord Pereira v. Sessions , ––– U.S. ––––, 138 S. Ct. 2105, 2113, 201 L.Ed.2d 433 (2018). Only if the statute is silent or ambiguous on the particular issue do we turn to the question of whether to defer to the Commissioner's interpretation of the statute. See Chevron , 467 U.S. at 843, 104 S.Ct. 2778 ; see also Epic Sys. Corp. v. Lewis , ––– U.S. ––––, 138 S. Ct. 1612, 1629–30, 200 L.Ed.2d 889 (2018).

In deciding whether Congress has spoken directly to the issue at hand, we do not confine ourselves "to examining a particular statutory provision in isolation." FDA v. Brown & Williamson Tobacco Corp. , 529 U.S. 120, 132, 120 S.Ct. 1291, 146 L.Ed.2d 121 (2000). Rather, we must read the words of the statutory provision "in their context and with a view to their place in the overall statutory scheme." Id. at 133, 120 S.Ct. 1291 (quoting Davis v. Mich. Dep't of Treasury , 489 U.S. 803, 809, 109 S.Ct. 1500, 103 L.Ed.2d 891 (1989) ); see also United States...