Erma E. Klinger, aka Erma Klinger, Plaintiff,
Carolyn W. Colvin, Commissioner of Social Security,  Defendant.
G. MURRAY SNOW, District Judge.
Pending before the Court is the appeal of Plaintiff Erma E. Klinger, which challenges the Social Security Administration's decision to deny benefits. (Doc. 14.) For the reasons set forth below, the Court vacates that decision.
On August 21, 2009, Klinger applied for disability insurance benefits, alleging a disability onset date of August 11, 2008. (R. at 11.) Klinger subsequently amended the onset date to October 1, 2010. ( Id. ) Klinger's date last insured ("DLI") for disability insurance benefits, and thus the date on or before which she must have been disabled, is December 31, 2013. ( Id. at 13.) Klinger's claim was denied both initially and upon reconsideration. ( Id. at 11.) Klinger then appealed to an Administrative Law Judge ("ALJ"). ( Id. ) The ALJ conducted a hearing on the matter in Phoenix, Arizona on July 26, 2011. ( Id. )
In evaluating whether Klinger was disabled, the ALJ undertook the five-step sequential evaluation for determining disability. ( Id. at 12-13.) At step one, the ALJ determined that Klinger had not engaged in substantial gainful activity since the alleged onset date. ( Id. at 13.) At step two, the ALJ determined that Klinger suffered from the severe impairments of mild anterior lumbar spurring and mild AC joint degenerative joint disease. ( Id. ) At step three, the ALJ determined that none of these impairments, either alone or in combination, met or equaled any of the Social Security Administration's listed impairments. ( Id. at 14.)
At that point, the ALJ made a determination of Klinger's residual functional capacity ("RFC"),  concluding that Klinger could perform light work as defined in 20 C.F.R. § 404.1567(b) except for the following limitations: Klinger is capable of lifting no more than fifteen to twenty pounds occasionally and is permitted to exercise a sit/stand option at will with customary breaks during an eight-hour workday. ( Id. ) The ALJ thus determined at step four that Klinger retained the RFC to perform her past relevant work as a fast food worker and restaurant manager. ( Id. at 16.) The ALJ therefore did not reach step five. ( Id. ) Given this analysis, the ALJ concluded that Klinger was not disabled. ( Id. at 17.)
The Appeals Council declined to review the decision. ( Id. at 1.) The Council accepted the ALJ's statements of the law, the issues in the case, and the evidentiary facts, as well as the ALJ's findings and ultimate conclusions regarding whether Klinger was disabled. ( Id. ) The Council thereupon agreed that Klinger was not disabled. ( Id. )
Klinger filed the complaint underlying this action on September 19, 2012, seeking this Court's review of the ALJ's denial of benefits. (Doc. 1.) The matter is now fully briefed before this Court. (Docs. 14, 16, 17.)
I. Standard of Review
A reviewing federal court will address only the issues raised by the claimant in the appeal from the ALJ's decision. See Lewis v. Apfel, 236 F.3d 503, 517 n.13 (9th Cir. 2001). A federal court may set aside a denial of disability benefits only if that denial is either unsupported by substantial evidence or based on legal error. Thomas v. Barnhart, 278 F.3d 947, 954 (9th Cir. 2002). Substantial evidence is "more than a scintilla but less than a preponderance." Id. (quotation omitted). "Substantial evidence is relevant evidence which, considering the record as a whole, a reasonable person might accept as adequate to support a conclusion." Id. (quotation omitted).
However, the ALJ is responsible for resolving conflicts in testimony, determining credibility, and resolving ambiguities. See Andrews v. Shalala, 53 F.3d 1035, 1039 (9th Cir. 1995). "When the evidence before the ALJ is subject to more than one rational interpretation, we must defer to the ALJ's conclusion." Batson v. Comm'r of Soc. Sec. Admin., 359 F.3d 1190, 1198 (9th Cir. 2004). This is so because "[t]he [ALJ] and not the reviewing court must resolve conflicts in evidence, and if the evidence can support either outcome, the court may not substitute its judgment for that of the ALJ." Matney v. Sullivan, 981 F.2d 1016, 1019 (9th Cir. 1992) (citations omitted).
Harmless errors in the ALJ's decision do not warrant reversal. Stout v. Comm'r, Soc. Sec. Admin., 454 F.3d 1050, 1055-56 (9th Cir. 2006). Errors are harmless if they are "inconsequential to the ultimate nondisability determination." Molina v. Astrue, 674 F.3d 1104, 1115 (9th Cir. 2012) (quoting Carmickle v. Comm'r, Soc. Sec. Admin., 533 F.3d 1155, 1162 (9th Cir. 2008)). Thus, for example, an error is harmless if the record shows that "the ALJ would have reached the same result absent the error" or "it was clear [the errors] did not alter the ALJ's decision." Id. "[T]he burden of showing that an error is harmful normally falls upon the party attacking the agency's determination." Shinseki v. Sanders, 556 U.S. 396, 409 (2009).
Klinger argues that the ALJ erred by: (A) improperly rejecting Klinger's treating physician's opinion, (B) misinterpreting evidence to Klinger's detriment, (C) failing to fully and fairly develop the record, and (D) improperly rejecting Klinger's ...