NOT FOR PUBLICATION FILED

FEB 28 2018

UNITED STATES COURT OF APPEALS

MOLLY C. DWYER, CLERK

U.S. COURT OF APPEALS

FOR THE NINTH CIRCUIT

LORI WERLEIN, No. 16-15359

Plaintiff-Appellant, D.C. No. 1:14-cv-01383-JLT

v.

MEMORANDUM*

NANCY A. BERRYHILL, Acting Commissioner Social Security,

Defendant-Appellee.

Appeal from the United States District Court for the Eastern District of California Jennifer L. Thurston, Magistrate Judge, Presiding

Submitted February 15, 2018** Pasadena, California

Before: THOMAS, Chief Judge, and REINHARDT and FISHER, Circuit Judges.

Lori Werlein appeals from the district court’s judgment affirming the denial

of her application for disability insurance benefits. The administrative law judge

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. ** The panel unanimously concludes this case is suitable for decision without oral argument. See Fed. R. App. P. 34(a)(2). 2

(“ALJ”) found that Werlein was not disabled because she had the residual functional

capacity (“RFC”) to perform her past relevant work as a security guard. We review

the district court’s decision de novo and will uphold the Social Security

Administration’s disability determination “unless it contains legal error or is not

supported by substantial evidence.” Orn v. Astrue, 495 F.3d 625, 630 (9th Cir.

2007).

1. We conclude that the ALJ erred by failing to explain why he rejected

critical aspects of Werlein’s subjective symptom testimony. “In determining a

claimant’s RFC, an ALJ must consider all relevant evidence in the record,

including, . . . medical records, lay evidence, and the effects of symptoms, including

pain, that are reasonably attributed to a medically determinable impairment.”

Robbins v. Soc. Sec. Admin., 466 F.3d 880, 883 (9th Cir. 2006) (internal quotation

marks and citation omitted). To find a claimant’s subjective symptom testimony

unreliable, the ALJ is “required to make ‘a credibility determination with findings

sufficiently specific to permit the court to conclude that the ALJ did not arbitrarily

discredit [the] claimant’s testimony.’” Tommasetti v. Astrue, 533 F.3d 1035, 1039

(9th Cir. 2008) (quoting Thomas v. Barnhart, 278 F.3d 947, 958 (9th Cir. 2002)). If,

as in this case, there is no evidence of malingering, the ALJ may “reject the 3

claimant’s testimony about the severity of her symptoms only by offering specific,

clear and convincing reasons for doing so.” Id. at 1039 (quoting Smolen v. Chater,

80 F.3d 1273, 1281 (9th Cir. 1996)). “This is not an easy requirement to meet: ‘The

clear and convincing standard is the most demanding required in Social Security

cases.’” Garrison v. Colvin, 759 F.3d 995, 1015 (9th Cir. 2014) (quoting Moore v.

Comm’r of Soc. Sec. Admin., 278 F.3d 920, 924 (9th Cir. 2002)).

Here, the ALJ did not provide sufficiently specific, clear, or convincing

reasons—let alone any reasons—for rejecting Werlein’s subjective symptom

testimony regarding missed work. Werlein testified that she is limited in her ability

to work because she “can’t think at all,” has “trouble focusing,” suffers from knee

pain, “barely sleep[s]” and has thyroid problems. In response to her counsel’s

question regarding absenteeism, “whether it was for physical or mental health

problems,” Werlein testified that she would miss on average 8 to 10 days of work

per month. In the context of that questioning, she discussed her depression and also

the fact that her thyroid medication interferes with her ability to sleep. Her testimony

made it clear that her absenteeism related to a combination of physical and mental

health problems, not just her mental health problems as the Government suggests. 4

The ALJ concluded that Werlein suffers from a combination of the following

impairments: obesity, Graves’ disease, and mood disorder with a history of

drug/alcohol addiction. The ALJ noted that Werlein’s “medically determinable

impairments could reasonably be expected to cause some [of] the alleged

symptoms.” However, the ALJ then broadly asserted that Werlein’s “statements

concerning the intensity, persistence, and limiting effects of these symptoms are not

entirely credible . . . . In particular, some of the alleged symptoms and limitations

are inconsistent with medical findings and opinions . . . and this detracts from the

credibility of her allegations.” Although he rejected Werlein’s testimony in large

part, he did “accord some weight to the claimant’s statements regarding her ability

to see, sit, stand and walk.” However, the ALJ never explained why he rejected

some parts of Werlein’s testimony and not others. Critically here, the ALJ never

addressed her testimony that she would miss 8 to 10 days of work per month due to

a combination of mental health and physical problems. He also never addressed her

testimony that her thyroid medication causes sleeplessness, which interferes with her

ability to go to work, even though he concluded that her thyroid problem is

controlled by medication. In fact, he acknowledged that Werlein “alleged [that her]

thyroid medication caused problems with her ability to sleep.” This was error: 5

“General findings are insufficient; rather, the ALJ must identify what testimony is

not credible and what evidence undermines the claimant’s complaints.” Ghanim v.

Colvin, 763 F.3d 1154, 1163 (9th Cir. 2014) (internal quotation marks and citations

omitted).

2. The ALJ’s error was not harmless. “An error is harmless only if it is

inconsequential to the ultimate nondisability determination, or if despite the legal

error, the agency’s path may reasonably be discerned.” Brown-Hunter v. Colvin,

806 F.3d 487, 494 (9th Cir. 2015) (internal quotation marks and citations omitted).

At the hearing, the Vocational Expert (“VE”) was asked: “Assuming that the

claimant’s testimony is credible and that she missed approximately eight days per

month in her previous employment, . . . with that attendance would that preclude any

work in the national economy.” The VE responded, “[t]hat definitely would.”

Although the ALJ cited to medical evidence undermining Werlein’s alleged

“inability to focus and think,” including her reports that she was taking medication

and was in a “happier mood,” we cannot reasonably discern from the record that

Werlein’s absenteeism resulted only from mental impairments or poor concentration

in particular. For instance, Werlein also testified that her knees and lack of sleep

caused by her thyroid medication limited her ability to work. In other words, the 6

ALJ’s failure to address Werlein’s missed-work testimony was anything but

inconsequential.

Because the ALJ’s decision is based on prejudicial legal error, we reverse.

3. We also conclude that remand for an award of benefits is appropriate in

this case. Under our settled “credit-as-true” rule, we remand to calculate and award

benefits when “(1) the record has been fully developed and further administrative

proceedings would serve no useful purpose, (2) the ALJ has failed to provide legally

sufficient reasons for rejecting evidence, whether claimant testimony or medical

opinion; and (3) if the improperly discredited evidence were credited as true, the

ALJ would be required to find the claimant disabled on remand.” Garrison, 759

F.3d at 1020.

As to the first factor, the record in this case is extensive, including hundreds

of pages of medical reports, Werlein’s testimony at the hearing before the ALJ, and

assessments of her capacity to work by multiple consultants. A review of the record

reveals that Werlein consistently reported her impaired sleep to multiple doctors,

including the prescribing doctor for her thyroid medication, and that no doctor

contradicted that side effect. In addition, the vocational expert testified directly as

to whether an individual with Werlein’s alleged limitation of missing 8 to 10 days 7

of work per month would be able to do any work. In light of this extensive record,

additional evidence would not be enlightening. Remand for “the purpose of

allowing the ALJ to have a mulligan” would not be a “useful purpose” for granting

additional administrative proceedings. Id. at 1022.

As to the second factor, we have already discussed the ALJ’s failure to provide

legally sufficient reasons for discrediting Werlein’s symptom testimony that she

would miss 8 to 10 days of work per month.

As to the third factor, if the improperly discredited testimony were credited as

true, it is clear that the ALJ would be required to find Werlein disabled. The VE’s

testimony at the hearing on this issue is clear, unopposed, and uncontradicted: a

limitation of missing 8 to 10 work days per month would “definitely” preclude

employment. Such a finding by the VE is a sufficient basis upon which to remand

for determination of benefits. Thus, if credited as true, Werlein’s testimony

regarding absenteeism would require the ALJ to conclude that she was in fact

disabled.

Finally, we exercise our discretion to grant benefits under the credit-as-true

rule because this case is not one in which “an evaluation of the record as a whole

creates serious doubt that a claimant is, in fact, disabled.” Id. at 1021. The credit- 8

as-true rule “helps to ensure that [subjective symptom] testimony will be carefully

assessed and its importance recognized” in the initial proceeding. Varney v. Sec’y

of Health & Human Servs., 859 F.2d 1396, 1399 (9th Cir. 1988). “Delaying the

payment of benefits by requiring multiple administrative proceedings that are

duplicative and unnecessary only serves to cause the applicant further damage—

financial, medical, and emotional.” Id. Remand in this case is consistent with these

values and appropriate under the credit-as-true rule. Accordingly, we remand to the

district court with instructions to remand to the ALJ for a calculation and award of

appropriate benefits.

REVERSED and REMANDED