United States District Court, E.D. Louisiana
REPORT AND RECOMMENDATION
C. WILKINSON, JR. UNITED STATES MAGISTRATE JUDGE
Velasquez, on behalf of her deceased husband, David
Velasquez, seeks judicial review pursuant to Section 405(g)
of the Social Security Act (the “Act”) of the
final decision of the Commissioner of the Social Security
Administration (the “Commissioner”), denying
David Velasquez's claim for disability insurance benefits
under Titles II and XVI of the Act. 42 U.S.C.
§§423, 1382c. This matter was referred to a United
States Magistrate Judge pursuant to 28 U.S.C. § 636(b)
and Local Rule 73.2E(B).
filed his applications for DIB and SSI on June 6, 2014,
alleging disability since May 9, 2009 due to cracked
vertebrae, herniated discs, limited movement in neck and
shoulders, uncontrolled headaches, neck and shoulder
arthritis, hypertension, pain, cholesterol, obesity and
hepatitis C. (Tr. 21, 67-68, 155-66, 184, 219). He later
amended his alleged onset date to August 26, 2014. (Tr. 21,
45). After his claim was denied at the agency level,
plaintiff requested a hearing before an Administrative Law
Judge (ALJ), which was held on June 14, 2016. (Tr. 43-66).
The ALJ issued a decision denying the applications on July
14, 2016. (Tr. 8-31). Velasquez requested review by the
Appeals Council on July 25, 2016 (Tr. 5) and submitted new
evidence on January 24, 2017. (Tr. 39-41). After the Appeals
Council denied review on July 11, 2017, the ALJ's
decision became the Commissioner's final decision for
purposes of this court's review. (Tr. 1-4). Plaintiff
filed a timely memorandum of facts and law. Record Doc. No.
14. Defendant filed a timely reply memorandum. Record Doc.
issued a report and recommendation, Record Doc. No. 16, in
which I recommended that the presiding district judge dismiss
the plaintiff's claim with prejudice. In her Objection to
Magistrate Judge's Report and Recommendation, Record Doc.
No. 17, plaintiff argued-for the first time at any stage of
these proceedings-that the initial decision by the Social
Security administrative law judge ("ALJ") was
invalid because he was not properly appointed pursuant to the
Appointments Clause. The objection relied upon the United
States Supreme Court's recent decision in Lucia v.
S.E.C., 138 S.Ct. 2044 (2018). Record Doc. No. 17 at pp.
9-10. Judge Africk remanded and again referred the matter to
me. Record Doc. No. 19. I conducted a status conference with
counsel for both parties on September 24, 2018. At that
conference, I requested supplemental briefing from both
parties addressing the Lucia issue. Record Doc. No.
23. Defendant submitted its supplemental brief on October 17,
2018, Record Doc. No. 24, arguing that because plaintiff did
not raise the Appointments Clause issue at the agency level,
the objection had been waived. Plaintiff submitted her
supplemental brief on November 20, 2018, arguing that the
Lucia issue had not been waived. Record Doc. No. 27
at p. 8. Plaintiff also urges the court to reconsider the
merits of the instant matter, rather than merely the
Lucia Appointments Clause issue. Record Doc. No. 27
at p. 1. I note however that Judge Africk's order, Record
Doc. No. 19, referred and remanded the instant matter to me
only to address Lucia. In addition, I see no reason
or basis to reconsider my previous recommendation, which
stands unaltered. Accordingly, I will consider only the
Lucia Appointments Clause issue in this report and
LAW AND ANALYSIS
21, 2018, the United States Supreme Court in Lucia
determined that executive agency ALJs are “officers of
the United States” and subject to the Appointments
Clause of the United States Constitution, Art. II, s.2, cl.
2. Lucia, 138 S.Ct. at 2055. The Appointments Clause
. . . [the President] shall nominate, and by and with the
Advice and Consent of the Senate, shall appoint Ambassadors,
other public Ministers and Consuls, Judges of the [S]upreme
Court, and all other Officers of the United States, whose
Appointments are not herein otherwise provided for, and which
shall be established by Law: but the Congress may by Law
vest the Appointment of such inferior Officers, as they
think proper, in the President alone, in the Courts of
Law, or in the Heads of Departments.
U.S. Constitution, Art. II, § 2, cl.2 (emphasis added).
The Court found that the Securities and Exchange
Commission's ("SEC") ALJ, who conducted the
claimant's hearing and issued an unfavorable decision on
July 14, 2016, had been appointed by SEC staff members,
not the SEC department head, and therefore was
not appointed in accordance with the Appointments
Clause of the Constitution. Lucia, 138 S.Ct. at
Lucia, after determining that the ALJ was appointed
in violation of the Appointments Clause, the Supreme Court
remanded the matter to the SEC for a remedial hearing by
either a properly appointed ALJ or the Commission itself.
Lucia, 138 S.Ct. at 2055. The Court found that such
a hearing was the "'appropriate' remedy" in
that case. Id. (quoting Ryder v. United
States, 515 U.S. 177, 188 (1995)). The Lucia
Court also found that, even if the unconstitutionally
appointed ALJ had received a constitutional appointment since
the first hearing, because he had already heard the case, he
could not conduct the second hearing.
Lucia, 138 S.Ct. at 2055.
before Lucia was decided, "[c]ourts have
reasoned that a constitutional challenge under the
Appointments Clause is nonjurisdictional, and, thus,
a party may forfeit his Appointments Clause claim by failing
to raise it at the administrative level." Faulkner
v. Comm'r of Social Security, 2018 WL 6059403, at *2
(W.D. Tenn. Nov. 19, 2018) (citing NLRB v. RELCO
Locomotives, Inc., 734 F.3d 764, 798 (8th Cir. 2013)
(emphasis added); Intercollegiate Broad. Sys. v.
Copyright Royalty Bd., 574 F.3d 748, 755-56 (D.C. Cir.
2009) (per curiam); In re DBC, 545 F.3d 1373,
1378-81 (Fed. Cir. 2008)).
Lucia, courts outside the Fifth Circuit have
required the plaintiff to assert the Appointments Clause
issue before the presiding ALJ or the Appeal Council; if the
issue is raised afterwards, it is deemed waived. The United
States District Court for the Northern District of Iowa in
Davis v. Comm'r of Soc. Sec., 2018 WL 4300505,
at *8 (N.D. Iowa Sept. 10, 2018) has cited Lucia for
the proposition that "'one who makes a timely
challenge to the constitutional validity of the
appointment of an officer who adjudicates his case is
entitled to relief.'" Davis, 2018 WL
4300505, at *8 (quoting Lucia, 138 S.Ct. at 2055)
(internal citations omitted) (emphasis added). The
Davis court noted that the Lucia plaintiff
made such a timely challenge by objecting at the
administrative level to the constitutionality of the
ALJ's appointment. Id. Unlike the plaintiff in
Lucia, the Davis plaintiff did not
object to the ALJ's appointment until after the
magistrate judge issued a report and recommendation, as in
the instant matter. Davis, 2018 WL 4300505, at *8.
Because the plaintiff did not raise the issue "before
the ALJ or the Appeals Council," the Davis
court found that he had waived the objection. Id.
(citing RELCO Locomotives, Inc., 734 F.3d at 798
(concluding that a plaintiff who raised an Appointments
Clause challenge “waived its challenge to the
Board's composition because it did not raise the issue
before the Board”); Anderson v. Barnhart, 344
F.3d 809, 814 (8th Cir. 2003) (finding that a claimant's
failure to raise a disability claim during the administrative
process “waived [the claim] from being raised on
appeal”); Shaibi v. Berryhill, 883 F.3d 1102,
1109 (9th Cir. 2017) (“[W]hen claimants are represented
by counsel, they must raise all issues and evidence at their
administrative hearings in order to preserve them on
appeal.”) (quoting Meanel v. Apfel, 172 F.3d
1111, 1115 (9th Cir. 1999)); Trejo v. Berryhill,
2018 WL 3602380, at *3 n.3 (C.D. Cal. July 25, 2018)
(“To the extent Lucia applies to Social
Security ALJs, [p]laintiff has forfeited the issue by failing
to raise it during her administrative proceedings.”).
Other courts have decided this issue in the same way.
See, e.g. Garrison v. Berryhill, 2018 WL
4924554, at *2 (W.D. N.C. Oct. 10, 2018); Stearns v.
Berryhill, 2018 WL 4380984, at *6 (E.D. Iowa Sept. 14,
2018); Holcomb v. Berryhill, 2018 WL 3201869, at *3
n. 3 (C.D. Cal. June 21, 2018); Kabani & Company,
Inc. v. U.S. Securities & Exchange Commission, 733
Fed.Appx. 918, 919 (9th Cir. Aug. 13, 2018);
Faulkner, 2018 WL 6059403 at *2-3; Page v.
Commissioner of Social Security, 2018 WL 5668850 at *2-3
(E.D. Mich. Oct. 31, 2018); Salmeron v. Berryhill,
2018 WL 4998107 at *3 n.5 (C.D. Cal. Oct. 15, 2018);
Davidson v. Commissioner of Social Security, 2018 WL
4680327 at *1-2 (M.D. Tenn. Sept. 28, 2018).
cites Sims v. Apfel, 530 U.S. 103, 112 (2000), to
argue that she did not waive any issues by not raising those
issues in her request to the Appeals Council. Record Doc. No.
27 at p. 8. In Sims, the Supreme Court held that,
"[t]he Council, not the claimant, has primary
responsibility for identifying and developing the
issues," Sims, 530 U.S. at 112, and plaintiff
argues that "[i]t is defendant, not claimant, who should
have raised the issue [of the constitutionality of the
ALJ's appointment], so that claimant's failure to do
so cannot bar his raising the issue at Federal Court."
Record Doc. No. 27 at p. 10. The district court in
Davis addressed and rejected a similar argument by
the plaintiff in that case. The Davis court noted
that "'Sims concerned only whether a
claimant must present all relevant issues to the Appeals
Council to preserve them for judicial review; the
[Supreme] Court specifically noted that "[whether] a
claimant must exhaust issues before the ALJ is not before
us.'"" Davis, 2018 WL 4300505, at *9
(citing Shaibi, 883 F.3d at 1102 (quoting
Sims, 530 U.S. at 107)) (emphasis in original). In
Davis, as in the instant matter, "[plaintiff]
did not present his Appointments Clause challenge to the ALJ
or the Appeals Council." Davis, 2018
WL 4300505, at *9 (emphasis in original). Many other courts
addressing this ...