Hyatt v. Heckler, C-C-83-655-M.

• Decision Date: 31 March 1989
• Docket Number: No. C-C-83-655-M.,C-C-83-655-M.
• Citation: 711 F. Supp. 837
• Court: U.S. District Court — Western District of North Carolina
• Parties: Patrick H. HYATT, Herman O. Caudle and Mary P. Lovingood, on behalf of themselves and all others similarly situated, Plaintiffs, v. Margaret M. HECKLER, or her successor in office, Secretary of the United States Department of Health and Human Services, Defendant.

711 F. Supp. 837

Patrick H. HYATT, Herman O. Caudle and Mary P. Lovingood, on behalf of themselves and all others similarly situated, Plaintiffs, v. Margaret M. HECKLER, or her successor in office, Secretary of the United States Department of Health and Human Services, Defendant.

No. C-C-83-655-M.

United States District Court, W.D. North Carolina.

March 31, 1989.

Charles M. Sasser, Legal Services of Southern Piedmont, Inc., John Wester, Robinson, Bradshaw & Hinson, P.A., Charlotte, N.C., for plaintiffs.

A. George Lowe, Office of Gen. Counsel, Dept. of HHS, Baltimore, Md., and Jeffrey L. Bishop, Charlotte, N.C., for Dept. of N.C. Human Resources.

ORDER

McMILLAN, District Judge.

PROCEDURAL HISTORY

This is a class action brought against the Secretary of the United States Department of Health and Human Services ("Secretary"), challenging the policy of the Social Security Administration ("SSA") of denying and terminating social security benefits in various circumstances, in open violation of applicable decisions of the Fourth Circuit Court of Appeals. The individual plaintiffs and class members are applicants for or former recipients of disability benefits under Titles II and XVI of the Social Security Act, 42 U.S.C. §§ 401-433; 1381-1383c (1982 and Supp. IV 1986).¹

On February 14, 1984, in the first opinion in this case, Hyatt v. Heckler, 579 F.Supp. 985 (W.D.N.C.1984), this court found that the Secretary, in conscious and willful disregard of pertinent controlling decisions of the Fourth Circuit Court of Appeals, was:

(1) Denying claims for social security disability benefits based on hypertension or diabetes mellitus upon the theory that without end-organ damage (to heart, eyes, kidneys or brain), the claimant does not have a "severe impairment";

(2) Denying claims for social security disability benefits based on pain, upon the theory that subjective manifestations of pain cannot be considered disabling unless they are supported by objective clinical findings;

(3) Terminating social security benefits without substantial evidence that the recipient's disability has ceased.

The court ordered the Secretary to: (1) cease immediately the policy of refusing to follow the law of the Fourth Circuit; (2) help identify individuals who may be entitled to relief under the judgment; (3) begin following the law of the Fourth Circuit; and (4) issue written directives to SSA officials and other persons responsible for the administration of social security disability programs in North Carolina, ordering such persons to follow Fourth Circuit standards.

On March 16, 1984, the court certified a class of North Carolina residents, including those residents who had not exhausted their administrative remedies or had not sought judicial review of a final decision of the Secretary pursuant to Section 205(g) of the Social Security Act, 42 U.S.C. § 405(g) (1982).

The decision cited above was appealed, and on March 20, 1985, the Fourth Circuit Court of Appeals vacated this court's order of injunctive and declaratory relief. Hyatt v. Heckler, 757 F.2d 1455 (4th Cir.1985). The Court of Appeals held that the claims of those class members who had not exhausted their administrative remedies, pursuant to 42 U.S.C. § 405(g), before seeking judicial review, must be dismissed. The case was remanded to this court with instructions, among other things, to (1) direct the Secretary to identify and notify certain claimants for initial benefits, and (2) to remand to the Secretary for reconsideration, pursuant to the interim pain standard of Section 3(a) of the 1984 Social Security Disability Benefits Reform Act, the claims of certain class members who met the requirements of 42 U.S.C. § 405(g). On June 9, 1986, the United States Supreme Court granted plaintiffs' petition for writ of certiorari, vacated the opinion of the Fourth Circuit Court of Appeals and remanded to the Fourth Circuit for further consideration in light of Bowen v. City of New York, 476 U.S. 467, 106 S.Ct. 2022, 90 L.Ed.2d 462 (1986). Hyatt v. Bowen, 476 U.S. 1167, 106 S.Ct. 2886, 90 L.Ed.2d 974 (1986).

On remand, the Fourth Circuit Court of Appeals held that exceptional circumstances justified a waiver of the exhaustion of administrative remedies requirement of 42 U.S.C. § 405(g). 807 F.2d 376 (4th Cir. 1986).

On May 22, 1987, the Secretary filed a petition for a writ of certiorari in the Supreme Court. On October 5, 1987, the Supreme Court denied the Secretary's petition for a writ of certiorari. ___ U.S. ___, 108 S.Ct. 79, 98 L.Ed.2d 41 (1987).

On December 10, 1987, the court entered an order in which counsel were required to inform the court of the terms of the implementation plan adopted for the readjudication of the claims of Hyatt class members, 118 F.R.D. 572. On July 22, 1988, the Secretary filed a report setting forth the required information.

CURRENT CONTROVERSY

On August 8, 1988, plaintiffs moved for entry of an order enforcing the court's judgment, reported in Hyatt v. Heckler, 579 F.Supp. 985 (W.D.N.C.1984), supra. Plaintiffs allege that implementation of the plan proposed by the Secretary in a document filed July 28, 1988, if carried out, will accomplish indirectly what the Secretary's policy of "nonacquiescence" sought to do directly; that is, to flout binding precedents of the Fourth Circuit Court of Appeals and a critical feature in the holding of this court in this case. That feature is the direction that the Secretary abide by the ruling in Myers v. Califano, 611 F.2d 980, 983 (4th Cir.1980), requiring that the Secretary evaluate the disabling effects of a disability claimant's pain even if the degree or intensity of the pain is shown only by subjective evidence. 579 F.Supp. at 1002; 757 F.2d at 1462 (4th Cir.1985).²

On August 30, 1988, defendant filed a preliminary response to plaintiffs' motion, followed by a full response and a supplemental response filed on September 1, 1988.

On September 1, 1988, plaintiffs filed a supplemental memorandum in support of their motion for enforcement of the court's judgment and decrees. Oral argument was heard by the court on September 7, 1988. On October 7, 1988, the court entered an order finding that the Secretary has not clearly instructed Administrative Law Judges ("ALJ's") to observe and follow Fourth Circuit law as required by the law of this case. The court directed plaintiffs to tender proposed findings in accordance with the October 7, 1988, order, no later than October 31, 1988.

On October 12, 1988, the court received a letter from plaintiff's counsel requesting clarification of the October 7, 1988, order. That letter brought to the court's attention some imprecise language in the October 7 order. The court reviewed the order and found that a possible interpretation of that order was that objective medical evidence of an underlying impairment or ailment that could reasonably be expected to cause pain was not required for a finding of disabling pain. Under the Social Security Disability Benefits Reform Act of 1984, 42 U.S.C. § 423(d)(5)(A) ("DIBRA") (enacted October 9, 1984, expired January 1, 1987) and Myers v. Califano, 611 F.2d 980, 981-82 (4th Cir.1980), a requirement of medical evidence of the existence of an underlying impairment or ailment that could reasonably be expected to cause pain is acknowledged. This court has consistently respected the Myers ruling in this litigation. The court did not intend, in its October 7, 1988, order, to imply any abrogation of the requirement of medical evidence of an underlying impairment.

On October 14, 1988, seeking to clarify the October 7, 1988, order quickly and precisely, pursuant to Rule 60, the court directed plaintiffs to submit a proposed order revised "to the minimum extent necessary to achieve the clarification requested." That revised order was entered on October 21, 1988.

On October 21, 1988, subsequent to the entry of the revised order, the court received a motion to file responses to plaintiffs' proposed amended order and proposed instruction. The Secretary alleged that the amended order "far exceeded the statements contained in this court's earlier October 7, 1988 order." In fact, as discussed above, the one purpose and effect of the amended order was to narrow statements contained in the earlier order that were unintentionally broad. Although the court did not receive the Secretary's request until after the amended order was signed, the court has subsequently given full consideration to the Secretary's full response and motion for reconsideration filed on October 31, 1988. However, because the Secretary has already filed an appeal from those orders, this court will not directly address the motion for reconsideration.

On October 26, 1988, plaintiffs filed proposed findings pursuant to the orders of October 7 and October 21, 1988. Defendant filed his response on November 7, 1988. On November 18, 1988, plaintiffs filed a memorandum in support of the proposed findings and instructions.

The court has carefully reviewed the events, the evidence from the hearings, and pleadings regarding plaintiffs' proposed findings and instructions.

It is regrettably obvious that the Secretary has continued to refuse to take those measures necessary to assure that, in the Hyatt reviews, the law of this circuit will apply with full force and effect.

FINDINGS OF FACT AND CONCLUSIONS OF LAW

The Secretary's most recent indication of his policy views for this case appeared in his July 28, 1988, report to this court. In that report the Secretary provided the text of instructions his North Carolina decision-makers are to apply in Hyatt reviews in which claims are based on pain as a disabling condition.

At no point in the Hyatt instructions proposed by the Secretary does he state or even acknowledge this court's and the Fourth Circuit's findings, in this case, that the Secretary has refused to apply the binding precedent of this circuit with respect to...