Supreme Court Refuses To Hear Conn Case

      The Supreme Court has declined to hear one of the Conn cases. The issue in this case is the statutory provision requiring that the agency act “immediately” when it detects fraud. In the Conn cases the agency didn’t act for 15 years. Did this failure give affected claimants who were not themselves guilty of fraud (their lawyer, Eric Conn, was the one who did that) a get out of jail free card? The lower courts didn’t buy that argument and the Supreme Court has refused to hear the case.

About That Footnote

     Social Security is trying to worm its way out of the federal courts applying the new rule changing past relevant work from 15 years to 5 by saying in a footnote to a Social Security ruling that it expected the courts to apply the law in effect at the time of the administrative decision. 

    I wrote earlier that I didn't think that Social Security was getting out of this problem with a simple footnote.

    Here's a quote that may be of interest:

It is in the general true that the province of an appellate court is only to enquire whether a judgment when rendered was erroneous or not. But if subsequent to the judgment and before the decision of the appellate court, a law intervenes and positively changes the rule which governs, the law must be obeyed, or its obligation denied. If the law be constitutional . . . I know of no court which can contest its obligation. It is true that in mere private cases between individuals, a court will and ought to struggle hard against a construction which will, by a retrospective operation, affect the rights of parties, but in great national concerns . . . the court must decide according to existing laws, and if it be necessary to set aside a judgment, rightful when rendered, but which cannot be affirmed but in violation of law, the judgment must be set aside.

    Chief Justice John Marshall wrote that in United States v. Schooner Peggy, 5 U.S. 1 (1801). You don't have to go back that far to find the same principle applied. Try Bradley v. Richmond School Board, 416 U.S. 696 (1974). Want a case where this was applied to Social Security? See Hicks v. Califano, 600 F.2d 1048 (4th Cir. 1979). That one is especially applicable because it was a case arising from the initial adoption of the grid regulations.

    There won't be that many cases where the difference between 15 years and 5 years is outcome determinative,  I don't know why Social Security wants to fight over these few cases. Get it over with and accept the voluntary remands.

    For that matter, apply this at the Appeals Council. Don't apply res judicata to cases affected and grant reopenings within the two and four time periods allowed by law when requested.

A New Funding Mechanism For Agency Operations?

     The Consumer Financial Protection Bureau (CFPB) has an unusual funding mechanism. The law says it can draw funds “reasonably necessary to carry out” its operations without an annual appropriation. This has been challenged on the grounds that it violates the Appropriations Clause of the Constitution which provides that “[n]o Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law.” To the great surprise of many the Supreme Court has just upheld the CFPB funding mechanism. 

    This decision suggests that it would be constitutional if there were a similar funding mechanism in the Social Security Act for agency operations, such as a certain small percentage of benefits paid. If I remember correctly, the National Council of Social Security Management Associations (NCSSMA), an organization of agency management personnel, has called for this in the past.

    Would such a thing ever come to Social Security? Only if Democrats control the White House, House of Representatives and Senate and want to do it and can get past the filibuster in the Senate. This could not be done at the moment. Maybe it will never be possible. However, my guess is that this will be proposed. What we've got at the moment is seriously dysfunctional. 

    By the way, if CFPB had lost this case, doubt would have been thrown on the funding mechanism for Social Security benefits themselves. Annual appropriations might have been required for benefit payments, so this CFPB case was a big win for Social Security.

More On Supreme Court Ethics

      Because an article about Supreme Court ethics issues I quoted mentioned a gift offered by a Social Security claimant to a federal judge, I posted about it here. The problem isn't limited to Justice Thomas but he is the prime offender because of his acceptance of gifts and lavish vacations from those interested in the work of the Court.

     I thought I was mostly writing for other attorneys who knew a little about judicial ethics but many of the comments made here were along the lines of “Well, you can’t prove Justice Thomas changed his vote because of what he received so there’s no problem.” Let me clue in the non-attorneys. There is a code of conduct for federal judges. Canon 2 of those rules is titled “A Judge Should Avoid Impropriety and the Appearance of Impropriety in all Activities.” I’m sure that just about every state judiciary has the same rule. I don’t think you can reasonably argue that there’s no appearance of impropriety in Justice Thomas’ conduct. So why hasn’t this story blown up even more than it has? The code of conduct for federal judges doesn’t apply to Supreme Court justices. There is no code of conduct for Supreme Court justices.

     The lack of a code of conduct for Supreme Court justices is shocking. Even without a rule in place, Thomas’ conduct is shocking.

What A Contrast

     Michael Ponsor, a Senior U.S. District Court judge in Massachusetts, has written an op ed for the New York Times titled A Federal Judge Asks: Does the Supreme Court Realize How Bad It Smells?    

    Ponsor relates a couple of incidents from his time on the bench. Once he was having a casual conversation with an attorney who mentioned that he had two tickets to a Major League baseball game that he couldn't use. He asked if Judge Ponsor would like them. Even though he would have loved to take his young child to the game, Ponsor said no even though there was a good chance that the tickets wouldn't be used if he didn't take them. He later talks about another case:

... I issued a decision reversing the Social Security Administration’s denial of disability benefits to an older plaintiff. I was in our clerk’s office one day when the man and his wife approached me with a package. He had a woodworking hobby, and inside the package was an exquisitely crafted oak pencil case with bronze hinges. My ruling had made a big difference for them, and they wanted to extend this modest, personal gesture of gratitude. Again, they were obviously not being underhanded. Their lawsuit was over, and this was probably the last they would ever see of me. Nevertheless, as my police officer friends tell me, the road to perdition starts with a free cup of coffee. As politely as I could, I turned the pencil case down. It still pains me to remember their embarrassed, crestfallen faces. ...

    Contrast Judge Ponsor's appropriate behavior with that with some Supreme Court Justices who have accepted costly vacations and other valuable considerations from people whom they knew had an interest in the work of the Court. Ponsor's the kind of judge I know. Clarence Thomas (to pick the most prominent example) is something else.

    If you're an attorney and you're thinking, "What Justice Thomas has done is wrong but he's a reliable right wing vote on the Supreme Court so we can't force him out of office while a Democrat is in the White House", what is wrong with you? What Thomas has done is what judicial corruption looks like. You know that as well as me. You'd be apoplectic if a Justice appointed by a Democrat had done this and I'd be with you.  We can't accept this behavior from any Supreme Court justice, ever.

High Standards Required

     When I read that Supreme Court Justice Clarence Thomas received private extremely valuable considerations from those interested in the Court’s business, I am reminded of a Social Security Administrative Law Judge who got into trouble because a local attorney allowed the ALJ to park his boat on a vacant lot the attorney owned.

SSNs Exposed In Court Records

From a letter from Senator Ron Wyden to John Roberts, the Chief Justice:

I write with concern that federal courts are failing in their legal obligations to protect Americans’ private information, putting Americans at needless risk of identify theft, stalking and other harms. Each year, federal courts make available to the public court filings containing tens of thousands of Americans’ personal information, such as their Social Security Numbers (SSNs) and dates of birth. However, federal court rules — required by Congress — mandate that court filings be scrubbed of personal information before they are publicly available. These rules are not being followed, the courts are not enforcing them, and as a result, cach year tens of thousands of Americans are exposed to needless privacy violations. 

The Judicial Conference, the courts’ policy-making body, has known about this problem for at least a decade and has refused to act.  …

The most recent report, which was provided to my office in draft form, says the Federal Judicial Center (FIC), the courts’ research arm, has twice studied the problem of personal data appearing in public court records, in 2010 and 2015, and in both cases found significant violations of the judiciary’s privacy rules. In the most recent study, the FIC examined 3.9 million court records filed duringa one month period in 2013. It found 5,437 of these documents included one or more SSNs. If these statistics are representative of the problem, it would mean that the courts have made available to the public roughly half a million documents containing personal data since 2015. …

     I hope this isn’t happening in Social Security cases. Many, many years ago we used to put the claimant’s Social Security number in the case caption but those days are long gone. 

Supreme Court Holds That Denying SSI In Puerto Rico Is Constitutional

      Earlier this week I had noted that 16 of the 19 of the cases argued before the Supreme Court around the same time as U.S. v. Vaello-Madero, the case presenting the issue of whether it is constitutional to deny SSI to U.S. citizens who reside in Puerto Rico and other U.S. territories, had already been decided. My point was to expect a decision soon. The decision was announced today in U.S. v. Vaello-Madero. In an 8-1 decision the Court held that it is constitutional to deny SSI benefits in U.S. territories. Justice Sotomayor was the only dissenter. This issue goes back to the political arena. 

    Social Security has dodged a bullet. The agency would have had a terrible time dealing with an avalanche of SSI claims from Puerto Rico. If Congress does change the law so residents of U.S. territories can get SSI, the agency will have time to fully plan and staff up for the change and the change can be phased in.

Hanging Fire

     The Supreme Court heard oral arguments in nineteen cases in October and November 2021. By this time, opinions have been announced in sixteen of the nineteen cases. One of the three still awaiting an opinion is U.S. v. Vaello-Madero, on the constitutionality of denying SSI to U.S. citizens who reside in Puerto Rico. I don't know what we can infer from the delay other than that there probably won't be a unanimous opinion.

Supreme Court Opinion On Obscure Windfall Offset Issue

      From the syllabus of the Supreme Court's opinion in Babcock v. Kijakazi:

This case concerns retirement benefits due under the Social Security Act for a retired “military technician (dual status)" ... Like all dual-status technicians, Babcock was required to maintain membership in the National Guard. ... Upon retirement, Babcock applied to the Social Security Administration for benefits. The agency granted Babcock benefits but applied a statutory “windfall elimination provision” and reduced the amount of benefits to reflect Babcock’s receipt of civil-service pension payments for his work as a technician. ...

Held: Civil-service pension payments based on employment as a dual-status military technician are not payments based on “service as a member of a uniformed service” ...

     In other words, Babcock loses. Social Security will continue to apply the windfall offset to his Social Security benefits.

     While this seems like an obscure question to me, it probably affects at least hundreds of people, maybe thousands. That's the way it is with Social Security. It's so big that even tiny changes affect significant numbers of people.

Yesterday's Supreme Court Argument

     After yesterday's oral argument before the Supreme Court I had expressed optimism that the Court would find it unconstitutional to deny SSI benefits to U.S. citizens who live in Puerto Rico. Others, including a writer for the highly-regarded SCOTUSblog, felt otherwise.

     Let me explain. There were a number of questions asked by the justices about whether finding this exclusion unconstitutional would trigger litigation claiming denial of equal protection because certain laws favor one state or one region over another. Although the attorney representing Mr. Vaello-Madero could have done a better job of expressing it, the answer seemed simple to me. This sort of lawsuit can already be brought but seldom is because all that is required to withstand an equal protection challenge is a "rational basis" for a law. That's a minimal requirement that would normally be met. It's just that in this case, the exclusion of SSI is so obnoxious that it cannot even meet a minimal requirement.  If a statute is found that is as obnoxious as this one, then by all means the Court should find it unconstitutional but such a statute should be almost nonexistent. The states have representation in Congress. Puerto Rico doesn't. My interpretation of the questioning was that the Justices want to make sure they write a narrow decision finding it unconstitutional to deny SSI in Puerto Rico and were inquiring about how they should do it. Another interpretation would be that the justices were expressing reasons why it would be too dangerous to give relief to Mr. Vaello-Madero.

     Anyway, listen to the oral argument yourself and tell us what you think.

Oral Arguments In Vaello-Madero

      I listened to the oral argument is U.S. v. Vaello-Madero. You can't always tell from oral arguments and maybe I heard what I wanted to hear but my impression was that the only issue was how broad the opinion will be -- that all or virtually all of the justices are ready to hold it unconstitutional to deny SSI to U.S. citizens who reside in Puerto Rico and other territories. 

     If you also listened to the oral arguments, what was your take?

     Update: The Supreme Court reporter at the Washington Post thinks the Supreme Court is reluctant to extend SSI to Puerto Rico.  However, court reporters at The Hill seem uncertain about how the Court will come down.

Great Summary Of Upcoming SCOTUS Case On SSI For Puerto Rico

      Ian Millhiser has written an excellent summary for Vox of the legal issues presented by U.S. v. Vaello-Madero, which is to be heard by the Supreme Court tomorrow. Vaello-Madero presents the issue of whether it is constitutional to deny SSI benefits to U.S. citizens who reside in Puerto Rico and other U.S. territories. 

     The old precedents supporting the denial of SSI to Puerto Ricans, the so-called Insular Cases are so disreputable that they cannot be used to turn down Mr. Vaello-Madero. The Court could come up with new reasoning to justify turning down Mr. Vaello-Madero but would it? There probably won't be some liberal-conservative split on this case. Every amicus brief filed supported Mr. Vaello-Madero.

Budget Reconcilation Bill Extends SSI To Territories

      I spoke too soon about SSI changes not being in the budget reconciliation bill. The legislative text is now available and it includes one SSI change (page 1682) -- extending SSI to U.S. territories effective January 1, 2024. However, a case pending at the Supreme Court could extend SSI to the territories a lot sooner than that.

     Update to include some speculation: Maybe there won't be an oral argument in U.S. v. Vaello-Madero. Maybe an agreement was quietly made in that case and related cases. If the Biden Administration gets SSI for territories legislatively, the cases get dropped. That allows for an easier implementation -- giving Social Security almost two more years. (And I really think the government is going to lose this case if it is argued.) However, such an agreement would deprive claimants of benefits for that time period. That kind of deal is what I would have urged if I had been in the Solicitor General's office. I guess we'll see soon. The oral argument in U.S. v. Vaello-Madero is scheduled for November 9.

Oral Argument At SCOTUS On Social Security Case

      From SCOTUSblog:

Wednesday’s argument in Babcock v Kijakazi displayed a bench still uncertain about how to resolve a problem about the Social Security benefits available to a small group of National Guard workers.

The case involves a special rule that protects certain members of the “uniformed services” from a rule that limits Social Security benefits for people with irregular work histories over the course of their lifetime. … The case involves a group of about 50,000 people still living who worked before 1984 as a “dual-status military technician.” Although paid as civilians, those technicians provide a variety of services involving the National Guard and are obligated to maintain membership with an appropriate rank in the National Guard and to wear the corresponding uniform while on duty. At bottom, the question is whether the pay they receive for that work is “wholly” based on service “as” a member of a uniformed service, even though much of it is civilian rather than military work.

None of the justices seemed to approach the case with certainty. Two main threads of analysis dominated the argument. For Chief Justice John Roberts, it seemed obvious that some of the pay was for the serviceman’s work “as” a member of the National Guard, but much of it was for the various civilian duties of his technician status. …

Justice Elena Kagan – the only justice who seemed to state a settled view during the argument – seconded Roberts’ perspective, commenting “that we can sort of make this simpler” by following his lead, “and this is the way I read the language too.”

Conversely, Justice Neil Gorsuch found most relevant the statutory requirement that dual technicians must be members of the National Guard. In a colloquy with Nicole Reaves (appearing on behalf of the government), Gorsuch commented that “the work may be civilian for a bunch of other purposes, but it can only be performed by someone who is serving in the capacity of a National Guardsman.” …

Supreme Court Hearing Social Security Case Today

      From Scotusblog:

Wednesday’s argument in Babcock v Kijakazi will take the justices deep into the intersection of the Social Security Act and a host of statutes defining the obligations and compensation of National Guard workers. This will definitely not be the most closely watched case of the month — but the court’s resolution of the arcane question in the case may determine how much money certain veterans can receive in retirement benefits.

At the highest level of generality, the case involves an exception from a “windfall elimination provision” of the Social Security Act. To understand the issues before the justices, it is enough to know that Congress has adopted a statute designed to eliminate what it regards as “windfalls” that some workers would receive – unjustly large Social Security awards that would flow to workers who spent a substantial share of their working years in jobs not covered by Social Security. The exception to the windfall-elimination provision describes some payments to which that provision doesn’t apply – employees for whom Congress would tolerate what it generally would regard as a windfall. Specifically, the exception protects any “payment based wholly on service as a member of a uniformed service,” a defined term that includes among other things the Army National Guard of the United States. To put that another way, the “uniformed-services exception” at issue here allows members of uniformed services a windfall Social Security payment that is barred for members of the general public.

The question before the court is whether the benevolence of that uniformed-services exception reaches dual-status military technicians who serve in the National Guard. Those technicians provide a variety of services involving the equipment and supplies of the National Guard. Although they are paid as civilian employees, they routinely wear military uniforms and are obligated to maintain membership with an appropriate rank in the state National Guard where they are located, which carries with it (by law) membership in the Army National Guard of the United States. …

This Argument Seems Strong To Me

     From the Supreme Court amicus brief of the American Bar Association in U.S. v. Vaello-Madero, the case presenting the question of whether it is constitutional to deny SSI benefits to American citizens who reside in Puerto Rico:  

... As a threshold issue, all of the government’s justifications for the SSI law start from the premise that it has legitimate interests in treating Puerto Rico differently because of its territorial status. ...     

However, “[i]t is well settled that the Equal Protection Clause ‘protects persons, not groups.’” Engquist v. Or. Dep’t of Agric., 553 U.S. 591, 597 (2008) (citing Adarand Constructors, Inc. v. Peña, 515 U.S. 200, 227  (1995)). The “persons” whose equal-protection rights are implicated in this case are the particular Puerto Rico residents such as Mr. Vaello-Madero who would otherwise qualify for SSI, which is only a subset of Puerto Rico residents as a “group” or “jurisdiction.” The government’s justifications for the law must supply a rational basis for treating these particular individuals differently than similarly situated individuals who do qualify for SSI because they reside elsewhere. But because the government only focuses on how all Puerto Rico residents can be treated as a group, it fundamentally fails to provide a rational basis for discriminating against Mr. Vaello-Madero and similarly situated individuals who happen to reside in Puerto Rico. ...

Vaello-Madero Scheduled For Oral Argument On November 9

      The Supreme Court has revised its November argument calendar and added U.S. v. Vaello-Madero on November 9. Vaello-Madero presents the issue of whether it is constitutional to deny SSI benefits to U.S. citizens who reside in Puerto Rico.

     By the way, many amicus briefs have been filed already in this case. Every one supports the argument that it is unconstitutional to deny SSI to Puerto Rican residents.

    Also, by the way, the Supreme Court is going back to in person oral arguments for its October term. Will Justice Thomas go back to his silent ways?

Briefs Filed In Puerto Rico SSI Case

      Probably before the end of this year the Supreme Court will hold an oral argument in the case of U.S. v. Vaello-Madero, which presents the issue of whether it is constitutional to deny SSI benefits to U.S. citizens who reside in Puerto Rico. If the Supreme Court holds that it is unconstitutional it is estimated that several hundred thousand Puerto Ricans will file SSI claims. The brief on the merits on behalf of the U.S. was filed on June 7. The brief on the merits on behalf of Mr. Vaello-Madero was filed on August 30.

Hoist With Their Own Petard And Getting No Sympathy From Me

      From the Washington Post:

Ousted Social Security commissioner Andrew Saul, the Trump appointee who declared Friday he would defy his firing by President Biden, on Monday found his access to agency computers cut off, even as his acting replacement moved to undo his policies.

“I’m here to do the job,” Saul said from his home in Katonah, N.Y., where he had led the agency since the coronavirus pandemic forced most operations to shift in March 2020 to remote work, “but I can’t do anything with the communications shut down.”

 Saul, 74, called his firing and that of his deputy David Black, in an email from the White House Personnel Office, a “palace coup” ...

“There will be more,” said Saul, a wealthy former women’s apparel executive and prominent Republican donor who had served on the board of a conservative think tank that has called for cuts to Social Security benefits. “Stay tuned.” ...

His acting successor, Biden appointee Kilolo Kijakazi, took the reins Monday and was briefed by her staff on the agency’s top priorities, advocates in touch with her office said, including much anticipated planning for the safe reopening of Social Security’s national network of 1,200 field offices. ...

Senate GOP aides, speaking on the condition of anonymity to discuss political strategy, said they plan floor speeches starting this week ... to express their dismay with the White House. ...

Republicans also said they are considering procedural actions to block any permanent Biden nominees to the agency on the Senate floor.

“It’s not like Saul was a blazing partisan,” said one Senate GOP aide. “Our view is that longer terms for agencies like this exist for a reason.” ...

     There's so much here! Saul calls his ouster a "palace coup." What? Did he think he was a king? A threat of litigation? I'm sure the President is quaking in fear. Read the recent opinions of the Supreme Court and see if you think whatever lawsuit Saul files is going to get anywhere. Dark threats of procedural actions to block a nomination? I'm pretty sure that's not possible under current Senate rules. Saul not a "blazing partisan"? Are you kidding me? I can't even imagine what they think a "blazing partisan" would look like at Social Security if Saul wasn't one. Now they think that longer terms exist for a reason. Republicans are the ones who came up with the unitary executive theory that blew up longer terms. Do they think they're the only ones who get to use the unitary executive theory? Hoist with their own petard and getting no sympathy from me.