May 28, 2019

Supreme Court Decides Smith v. Berryhill

On May 28, 2019, the U.S. Supreme Court decided Smith v. Berryhill, holding a dismissal by the Social Security Administration’s Appeals Council on timeliness grounds after a claimant has had an administrative law judge hearing on the merits qualifies as a “final decision . . . made after a hearing” for purposes of allowing judicial review under 42 U.S.C. § 405(g).

The Social Security Act requires claimants generally to proceed through a four-step process before obtaining review from a federal court: (1) the claimant must seek an initial determination as to eligibility; (2) the claimant must seek reconsideration of the initial adverse determination; (3) the claimant must request a hearing, which is conducted by an administrative law judge; and (4) the claimant must seek review of the administrative law judge’s opinion by the Social Security Administration’s Appeals Council. Petitioner Ricky Lee Smith’s claim for disability benefits under Title XVI was denied at the initial-determination stage, upon reconsideration, and on the merits after a hearing before an administrative law judge. The parties disputed what happened next. Smith claimed that he timely requested Appeals Council review within the 60-day deadline, but the Social Security Administration asserted that it did not receive a request for review within the deadline. The Appeals Council determined that Smith’s claim was untimely, concluded that he lacked good cause for missing the deadline, and dismissed the request for review.

Smith sought judicial review of the Appeals Council’s dismissal. The district court held that it lacked jurisdiction to hear the suit. The U.S. Court of Appeals for the Sixth Circuit affirmed, on the ground that an Appeals Council decision to refrain from considering an untimely petition for review was not a “final decision” subject to review in federal court.

The Supreme Court reversed, concluding that the text, context, and presumption in favor of reviewability of agency action all support the conclusion that dismissal by the Appeals Council on timeliness grounds after a claimant has received an administrative law judge hearing on the merits qualifies as a “final decision . . . made after a hearing” for purposes of allowing judicial review under § 405(g).

As to the text, the Court found that the phrase “final decision” clearly denotes some kind of terminal event, and Congress’ use of “any” suggests an intent to use that term expansively. Moreover, the Court held that the clause “made after a hearing” most naturally suggests an administrative law judge hearing on the merits, which Smith had obtained.

As to the statutory context, the Court analogized to the administrative-law context of the Administrative Procedure Act, which provides that an action is “final” if it both marks the consummation of the agency’s decisionmaking process and is one by which rights or obligations have been determined or from which legal consequences will flow. According to the Court, both conditions are satisfied when a Social Security claimant has reached the fourth and final step of the Social Security Act’s four-step process and has had his request for review dismissed as untimely. The Court further reasoned that the statute as a whole reflects that Congress wanted more oversight by the courts in the Social Security context, not less.

Finally, the Court also found that the presumption in favor of reviewability of agency action supported its conclusion. The presumption is rebuttable, but the Court noted that burden for rebutting it is “heavy” and concluded that the agency had not rebutted the presumption here because Congress had not suggested any intention for the Social Security Administration to be the unreviewable arbiter of whether claimants had complied with the procedures that claimants must follow.

Justice Sotomayor delivered the opinion for a unanimous court.

Download Opinion of the Court.

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