Hubbard v. Commissioner of Social Security

Background

Susan Hubbard sought judicial review under 42 U.S.C. § 405(g) of the Commissioner of Social Security’s final decision denying her application for disability insurance benefits. The parties filed competing motions for judgment on the pleadings, which ask the court to decide the case based on the existing record and the parties’ legal arguments.

Hubbard argued that the administrative law judge (ALJ) who conducted her hearing and issued the agency decision had not been properly appointed under the Constitution’s Appointments Clause. Her challenge relied on the Supreme Court’s decision in Lucia v. SEC, which held that certain administrative law judges were improperly appointed. The ALJ hearings in Hubbard’s case occurred in 2017, and the ALJ issued the decision that year, before the Acting Commissioner later ratified the appointments of Social Security Administration ALJs.

Issue-Exhaustion Argument

The Commissioner did not argue in the motion papers that Social Security ALJs were employees rather than officers for purposes of the Appointments Clause. Instead, the Commissioner argued that Hubbard had waived or forfeited the constitutional challenge by failing to raise it during the administrative proceedings and raising it for the first time in federal court.

While the case was pending, the Supreme Court decided Carr v. Saul. Carr held that claimants were not required to raise Appointments Clause challenges to Social Security ALJs during the agency proceedings in order to preserve those challenges for judicial review. The court therefore concluded that Hubbard’s challenge was timely even though she first presented it in federal court.

Remand and Unresolved Arguments

The court applied Lucia’s remedy for an adjudication affected by an appointment violation: a new hearing before a properly appointed official. The court also concluded that the matter had to be assigned to a different ALJ from the one who had conducted the original hearing and issued the original decision, because that ALJ could not be expected to reconsider the case as though it had not previously been decided.

Because the Appointments Clause issue required remand, the court did not address Hubbard’s argument that the ALJ improperly weighed the medical-opinion evidence. It also did not address the Commissioner’s argument that the ALJ’s residual functional capacity finding was legally correct and supported by substantial evidence. The court stated that the parties could raise those arguments again later if Hubbard were again denied benefits on similar grounds after remand.

Disposition

The court ordered that Hubbard’s motion for judgment on the pleadings be granted in part as to the Appointments Clause challenge and that the case be remanded to the Commissioner for further proceedings before a properly appointed ALJ. It further ordered that the case be assigned to an ALJ different from the one who conducted the original hearing and issued the original agency decision. The Commissioner’s cross-motion for judgment on the pleadings was denied. The clerk was directed to enter judgment in Hubbard’s favor directing remand.