FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
ROBERT W. STRAUSS,
Plaintiff-Appellee, No. 10-35139
v.
D.C. No.
6:08-cv-00931-AA
COMMISSIONER OF THE SOCIAL
SECURITY ADMINISTRATION, OPINION
Defendant-Appellant.
Appeal from the United States District Court
for the District of Oregon
Ann L. Aiken, Chief District Judge, Presiding
Argued and Submitted
March 11, 2011—Portland, Oregon
Filed March 28, 2011
Before: Sidney R. Thomas and Susan P. Graber,
Circuit Judges, and James V. Selna,* District Judge.
Opinion by Judge Graber
*The Honorable James V. Selna, United States District Judge for the
District of Central California, sitting by designation.
4151
STRAUSS v. CSSA 4153
COUNSEL
Sydney Foster, Civil Division, United States Department of
Justice, Washington, D.C., for the defendant-appellant.
David B. Lowry, Portland, Oregon, for the plaintiff-appellee.
OPINION
GRABER, Circuit Judge:
Plaintiff Robert W. Strauss seeks social security disability
benefits, which the Commissioner of Social Security
(“Commissioner”) ultimately denied after two hearings. The
district court held that, in rendering his second decision, the
administrative law judge (“ALJ”) had failed to comply with
express directives in remand orders from the court and from
the Social Security Administration’s Appeals Council
(“Appeals Council”) and, for that reason, remanded for pay-
ment of benefits. We reverse and remand to the district court
to consider whether the evidence establishes that Plaintiff is
disabled, because the court is without authority to order pay-
ment of benefits absent a finding of disability.
BACKGROUND
Plaintiff filed for disability benefits on December 23, 2003.
He claimed that he had become disabled on October 31, 2001,
4154 STRAUSS v. CSSA
as a result of left-knee chronic neuropathic pain, hypertension,
and depression. His application was denied initially and upon
reconsideration, and he requested a hearing before an ALJ.
An ALJ conducted a hearing at which he received testi-
mony from Plaintiff, Plaintiff’s wife, their son and daughter,
and a vocational expert. The ALJ issued a decision on Febru-
ary 23, 2006, finding that Plaintiff was not disabled. The
Appeals Council denied Plaintiff’s request for review.
Plaintiff then filed a complaint in district court. Pursuant to
a stipulation of the parties, the court reversed the ALJ’s deci-
sion and remanded the case for further administrative pro-
ceedings. The court’s remand order provided in part:
The ALJ will conduct a new hearing, further develop
the record and issue a new decision;
The ALJ will evaluate and further develop the medi-
cal evidence or record;
The ALJ will consider Plaintiff’s obesity pursuant to
SSR 02-1p;
The ALJ will further consider Plaintiff’s credibility
pursuant to SSR 96-7p;
The ALJ will discuss and evaluate the lay witness
testimony from Plaintiff’s wife, June Strauss, son,
Joshua Strauss, and daughter, Nicole Strauss;
The ALJ will re-evaluate Plaintiff’s [residual func-
tional capacity] pursuant to SSR 96-8p;
The ALJ will re-evaluate step four and if necessary
step five of the sequential evaluation process with
the assistance of a vocational expert, as necessary.
STRAUSS v. CSSA 4155
Consistent with that court order, the Appeals Council
issued its own remand order for further administrative pro-
ceedings. The Appeals Council’s extensive order required,
among other things, that the ALJ “[u]pdate the medical record
with existing evidence from the treating sources, to include
medical source statements (20 CFR [§ ] 404.1512).”1 The
Appeals Council’s remand order also required a further evalu-
ation of Plaintiff’s subjective complaints.
The ALJ conducted a second, supplemental hearing at
which Plaintiff and a vocational expert testified. Again, on
May 29, 2008, the ALJ found that Plaintiff was not disabled,
and again Plaintiff filed a complaint in district court.
The district court held that the ALJ had failed to comply
with the court’s and the Appeals Council’s remand orders to
update and further develop the medical records, to obtain
medical source statements, and to conduct a new credibility
analysis. The court then ruled that the ALJ’s noncompliance
suggested “that the outcome of [P]laintiff’s hearing was pre-
determined” and was “sufficient to merit reversal in this
case.” As a result, the court did not “consider [P]laintiff’s
remaining arguments” concerning alleged errors in the ALJ’s
analysis. Thereafter the Commissioner filed this timely
appeal.
DISCUSSION
Ordinarily, a district court’s decision to direct an award of
benefits, rather than to remand for further agency proceed-
ings, is reviewed for abuse of discretion. Benecke v. Barnhart,
379 F.3d 587, 590 (9th Cir. 2004). Here, the question is
whether the district court exceeded its statutory authority. An
1
A medical source statement is a “statement [from a medical source]
about what [an individual] can still do despite [his] impairment(s),” con-
sidering medical history, clinical and laboratory findings, diagnosis, and
treatment. 20 C.F.R. § 404.1513(b)(6).
4156 STRAUSS v. CSSA
error of law is an abuse of discretion. Koon v. United States,
518 U.S. 81, 100 (1996).
[1] The Social Security Act entitles a claimant to benefits
when it has been determined that the claimant is “disabled,”
as defined by the statute. 42 U.S.C. § 423(a)(1)(E), (d). In
Varney v. Secretary of Health & Human Services, 859 F.2d
1396 (9th Cir. 1988), and its progeny, we have addressed the
circumstances in which a court must remand for an award of
benefits. In Benecke, for example, we summarized:
Remand for further administrative proceedings is
appropriate if enhancement of the record would be
useful. Conversely, where the record has been devel-
oped fully and further administrative proceedings
would serve no useful purpose, the district court
should remand for an immediate award of benefits.
More specifically, the district court should credit evi-
dence that was rejected during the administrative
process and remand for an immediate award of bene-
fits if (1) the ALJ failed to provide legally sufficient
reasons for rejecting the evidence; (2) there are no
outstanding issues that must be resolved before a
determination of disability can be made; and (3) it is
clear from the record that the ALJ would be required
to find the claimant disabled were such evidence
credited.
379 F.3d at 593 (citations omitted).
[2] Notably, the required analysis centers on what the
record evidence shows about the existence or non-existence of
a disability. The ALJ’s errors are relevant only as they affect
that analysis on the merits. A claimant is not entitled to bene-
fits under the statute unless the claimant is, in fact, disabled,
no matter how egregious the ALJ’s errors may be. Briscoe ex
rel. Taylor v. Barnhart, 425 F.3d 345, 357 (7th Cir. 2005)
(“Obduracy is not a ground on which to award benefits; the
STRAUSS v. CSSA 4157
evidence properly in the record must demonstrate disabili-
ty.”).
[3] Here, the district court did not undertake to determine
whether Plaintiff is disabled within the meaning of the statute.
The court did not credit as true any evidence that the ALJ had
improperly excluded or discounted. The court did not con-
sider the alternatives (payment of benefits versus remand to
the agency) through the lens that Benecke provides. Rather,
the court awarded benefits because the ALJ failed to follow
its remand order and that of the Appeals Council.
[4] We do not disturb the district court’s conclusion that,
in fact, the ALJ failed to comply with the remand orders. We
hold only that the court may not move from that conclusion
directly to an order requiring the payment of benefits without
the intermediate step of analyzing whether, in fact, the claim-
ant is disabled. We therefore remand to the district court for
further proceedings.
REVERSED and REMANDED.