Aronovsky v. Berryhill, 5:19-cv-02356

Robert M. Aronovsky, an SSI recipient since 1987, received a $160,000 inheritance in October 2015.
On October 29, 2015, Aronovsky withdrew $159,800 and transferred it to a joint account with his two brothers.
The brothers used the inheritance to pay down $401,889.27 of mortgage debt on the house where Aronovsky lives with his mother; Aronovsky did not obtain any ownership interest in the property.
SSA determined the transfer was for less than fair market value and imposed a 3-year SSI ineligibility period (Nov 1, 2015–Oct 1, 2018); reconsideration and Appeals Council review were denied.
At hearing, the ALJ found Aronovsky used the funds to help pay the mortgage but concluded he failed to rebut the presumption that the transfer was made to establish SSI eligibility; ALJ also rejected Aronovsky’s equitable-life-estate argument based on a POMS entry.
The district court reviewed the ALJ’s decision, found substantial evidence supporting the penalty, denied Aronovsky’s summary judgment motion, and granted the Commissioner’s cross-motion.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the 3-year penalty for a transfer for less than fair market value was improperly applied without considering that the transfer served a non-eligibility purpose	Aronovsky: transfer was made to pay his mother’s mortgage and avoid foreclosure, not to qualify for SSI	Commissioner: regulation presumes transfers < FMV are to establish eligibility unless rebutted by "convincing evidence"; Aronovsky did not meet that burden	Court: Affirmed ALJ; substantial evidence shows Aronovsky failed to rebut the presumption, so penalty applies
Whether an equitable life estate (per POMS) or other exception excused the transfer penalty	Aronovsky: claimed POMS-based equitable life estate or other exception	Commissioner: POMS guidance cited is regional and in any event requirements not met; statutory/regulatory exceptions not demonstrated	Court: ALJ properly rejected equitable-life-estate claim and no other statutory exception was shown; exception does not apply

Morgan v. Comm’r of Soc. Sec. Admin., 169 F.3d 595 (9th Cir. 1999) (standard for overturning Commissioner’s decision)
Moncada v. Chater, 60 F.3d 521 (9th Cir. 1995) (substantial-evidence review and deference to Commissioner)
Drouin v. Sullivan, 966 F.2d 1255 (9th Cir. 1992) (consideration of whole administrative record)
Hammock v. Bowen, 879 F.2d 498 (9th Cir. 1989) (substantial-evidence standard in disability cases)
Kennedy v. Colvin, 738 F.3d 1172 (9th Cir. 2013) (POMS not binding law on courts or ALJs)
Carrillo-Years v. Astrue, 671 F.3d 731 (9th Cir. 2011) (POMS nonbinding status)