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Social Security Off the Hook for Improper Denial

(CN) - A woman with multiple sclerosis who was improperly denied Social Security benefits cannot recover attorneys' fees, the 9th Circuit ruled Tuesday.

In denying benefits to Jill Campbell, an administrative law judge, or ALJ, concluded that she failed to demonstrate that she was disabled because of multiple sclerosisas of June 30, 1996, the last date she was insured.

A unanimous three-judge panel of the 9th Circuit later concluded that this holding was in error, and Campbell moved for attorneys' fees.

This time, a divided panel sided with Social Security Commissioner Michael Astrue.

"In this case, the ALJ had to determine whether Campbell's multiple sclerosis rendered her disabled by June 30, 1996," the unsigned decision states. "The ALJ did not have any records from 1996 to examine. Instead, the ALJ had medical records from 1989 and 2000. The ALJ also had to consider circumstantial evidence that Campbell cared for her children and worked during that time, which justified doubts that Campbell was fully disabled. While the ALJ erred in her determination, the fact that she was trying to extrapolate what Campbell's injury may have been in 1996 from other evidence regarding a disease which may worsen at varying rates leads this court to conclude that the ALJ's decision was 'substantially justified.'"

Campbell cannot collect attorneys' fees but is entitled to recover $805 in filing costs, according to the Tuesday ruling.

Judge Kim Wardlaw dissented from the opinion, arguing that her colleagues had misinterpreted the Equal Access to Justice Act.

The dissent cites Campbell's testimony to the ALJ her symptoms generally progressed between 1995 and 1996 with several periods where she found it difficult to get out of bed. Cambell testified that she was sometimes forced to crawl to the bathroom or scoot on her butt to descend stairs.

Wardlaw emphasized that the ALJ discounted Campbell's testimony despite the fact that "not a single physician contradicted Campbell's description of her disability as of her last date insured." (Emphasis in original.)

"The commissioner was not 'substantially justified' in failing to apply the clearly established law that compelled the result we reached in this case," Wardlaw added. "Nor was the government justified in defending the agency's erroneous decision through multiple stages of litigation at taxpayer expense."

Citing precedent, Wardlaw said that "neither Campbell nor her attorney should be made to bear the burden of the ALJ's egregious error, and the government's zealous defense of it. Congress enacted the EAJA to prevent precisely such outcomes."

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