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November 8, 1993

OPHELIA BLACKMAN, individually and on behalf of all others similarly situated, Plaintiff,
DONNA SHALALA, Secretary of Health and Human Services, Defendant.


The opinion of the court was delivered by: SUZANNE B. CONLON

Ophelia Blackman, as class representative, *fn1" sues Donna Shalala ("the Secretary"), Secretary of Health and Human Services ("HHS"), for declaratory and injunctive relief regarding the Secretary's administration of the Supplemental Security Income ("SSI") program under the Social Security Act, 42 U.S.C. §§ 1381, et seq. Blackman contends that the Secretary violates the Social Security Act, federal regulations, and the Constitution by forwarding SSI applications of claimants who have prior claims on appeal to HHS' Appeals Council ("the appeals council"). Both Blackman and the Secretary move for summary judgment.


 Blackman, representing a class of similarly-situated claimants, challenges the internal administrative rule by which the Secretary forwards a claimant's SSI application to the appeals council when that claimant has a prior application pending before the appeals council. Blackman contends that the Secretary's rule, which defers a ruling on the subsequent claim, violates federal law and the Constitution.

 The gravamen of Blackman's complaint is that claimants filing SSI applications who already have an application pending on appeal face a no-win situation: HHS forwards the subsequent application to the appeals council, although the appeals council may not rule upon the subsequent claim; thus, even if the claimant is entitled to benefits in light of her new claim, she must wait out the lengthy appeals process on her initial application before receiving benefits. The only way for the claimant to obtain a speedier resolution for her subsequent claim would be to abandon the appeal of her initial claim, and any potential benefits for the period between filing the initial claim and filing the subsequent claim. SSI claimants whose circumstances deteriorate after filing initial applications (e.g., because of an illness) paradoxically must wait longer to receive benefits.

 The Secretary responds that it is HHS that faces the no-win situation. Were HHS not to forward new claims to the appeals council, there would be a duplication of effort and a waste of agency resources. She asserts that the practice conserves resources and prevents duplicate claims from being adjudicated concurrently in separate forums. She argues that were it not for her practice of forwarding claims to the appeals council, SSI applicants would face even longer delays. The Secretary contends that subsequent applications are forwarded to the appeals council in the interest of administrative efficiency.

 On October 23, 1992, the court certified a circuit-wide class of all claimants who have a claim pending before the appeals council and have had a subsequent application forwarded to the council without receiving an initial determination on the subsequent application from the Secretary. *fn2" Blackman's certification motion was granted as unopposed after repeated procedural defaults by the Secretary. The Secretary twice moved for reconsideration of the certification, but both times failed to present any ground for reconsideration, or any reason for her inattention to the certification motion when the motion was pending. The Secretary moved to dismiss for lack of jurisdiction and for improper venue, and moved for summary judgment. These motions were denied. See Memorandum Order and Opinion, No. 92 C 5472 (N.D. Ill. May 25, 1993); Memorandum Order and Opinion, No. 92 C 5472 (N.D. Ill. July 15, 1993). Blackman and the Secretary now move for summary judgment, pursuant to Fed. R. Civ. P. 56.


 1. Summary Judgment

 A movant is entitled to summary judgment when the moving papers and affidavits show there is no genuine issue of material fact and that the movant is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 322, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986); Local 103 v. Babcock & Wilcox, 1 F.3d 589, 591 (7th Cir. 1993). A genuine issue of material fact exists when "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 91 L. Ed. 2d 202, 106 S. Ct. 2505 (1986).

 In considering a motion for summary judgment, the court must consider all evidence in the light most favorable to the nonmoving party. Local 103, 1 F.3d at 591; Biddle v. Martin, 992 F.2d 673, 675 (7th Cir. 1993). However, once the moving party meets its burden of production, the nonmoving party must go beyond the pleadings and set forth specific facts showing that there is a genuine issue for trial. Fed. R. Civ. P. 56(e); Anderson, 477 U.S. at 248; Hickey v. A.E. Staley Mfg., 995 F.2d 1385, 1388 (7th Cir. 1993). Where the nonmovant fails to make a sufficient showing on an essential element of the case on which it would bear the burden of proof at trial, summary judgment is proper. Celotex, 477 U.S. at 322-23.

 In this case, there are no genuine issues of material fact; *fn3" summary judgment therefore is appropriate. The only contested question in this case is the legal effect of the Secretary's forwarding rule. Blackman and the Secretary move for summary judgment, both contending that they must prevail as a matter of law. Accordingly, the court must decide not whether summary judgment is appropriate, but which side should prevail.

 2. The SSI Program And The Forwarding Rule

 The SSI program provides basic subsistence to certain classes of needy persons. Howard v. Bowen, 823 F.2d 185, 187 (7th Cir. 1987). Under Title XVI of the Social Security Act, the Secretary must pay benefits under the SSI program to "every aged, blind, or disabled individual who is determined . . . to be eligible on the basis of his income and his resources." 42 U.S.C. §§ 1381a, 1382(a).

 The Secretary has prescribed by regulation a four-step eligibility determination process for SSI benefits. See 20 C.F.R. § 416.1001, et seq. A claimant first must apply with the state Disability Determination Service ("the state DDS") for an initial determination of eligibility. *fn4" If the state DDS denies the claimant's application, she may seek reconsideration. If the claim again is denied or reconsideration is denied, the claimant is entitled to a hearing before an administrative law judge ("ALJ"). Finally, if the ALJ rejects the claim, the claimant may request review of the ALJ's decision by the appeals council. *fn5"

 To assist in implementing the foregoing regulations, the Secretary has established internal operating rules, set forth in the Program Operations Manual System ("the manual"). The manual provides that when a claimant files an application while she has a prior claim pending before the appeals council, the subsequent application is forwarded to the appeals council for consideration without an initial determination being made by the state DDS. See Manual § DI 20101.025(C)(1) ("the forwarding rule"). *fn6" The appeals council may consider new and material evidence attached to the subsequent application relating to the period before the ALJ's decision on the first ...

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