Jody Kaufmann v. Kilolo Kijakazi, 32 F.4th 843

Jody Kaufmann applied for Social Security Disability benefits with an alleged onset in 2015; an ALJ denied benefits in October 2018, finding her symptom testimony not fully credible and that she could perform past work.
The Appeals Council denied review in July 2019. Commissioner Andrew Saul was head of SSA when the Appeals Council acted; earlier Acting Commissioner Berryhill had overseen ALJ-level processes.
Kaufmann sued; the district court reversed and remanded, concluding the ALJ failed to adequately explain why Kaufmann’s daily activities undermined her testimony.
The Commissioner filed a Federal Rule of Civil Procedure 59(e) motion, arguing the district court had clearly erred by overlooking the ALJ’s full explanation; the district court granted the motion and entered an amended judgment for the Commissioner.
On appeal the Ninth Circuit addressed (1) the constitutionality of 42 U.S.C. § 902(a)(3) (for-cause removal protection for the Social Security Commissioner) and (2) whether the district court abused its discretion in granting the Rule 59(e) motion.
The Ninth Circuit held the removal provision unconstitutional and severable, but concluded Kaufmann failed to show actual harm from the removal restriction, and also held the district court did not abuse its discretion in granting Rule 59(e); the Commissioner’s denial of benefits was therefore affirmed.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Constitutionality of 42 U.S.C. § 902(a)(3) (for-cause removal protection for the Commissioner)	§ 902(a)(3) unconstitutionally restricts the President's removal power and, because SSA acted under that provision, Kaufmann is entitled to a new proceeding.	The removal restriction is unconstitutional and severable, but Kaufmann must show actual, particularized harm from the restriction to upset the agency decision; no such harm shown.	§ 902(a)(3) violates separation-of-powers and is severed; President may remove the Commissioner at will, but Kaufmann failed to demonstrate actual harm, so the agency decision stands.
District court’s grant of Rule 59(e) to amend its judgment	The district court erred/abused discretion in granting the Commissioner’s Rule 59(e) motion after reversing and remanding.	The district court properly exercised its discretion to correct clear error after concluding it had overlooked the ALJ’s explanation.	No abuse of discretion: the district court correctly concluded it had clearly erred and properly amended its judgment; substantial evidence supports the ALJ’s credibility finding.

Seila Law LLC v. Consumer Fin. Prot. Bureau, 140 S. Ct. 2183 (2020) (single‑director independent agency removal restriction unconstitutional; severability analysis)
Collins v. Yellen, 141 S. Ct. 1761 (2021) (applies Seila Law to FHFA; holds removal restriction unconstitutional and explains remedy/harm requirement)
Free Enter. Fund v. Pub. Co. Acct. Oversight Bd., 561 U.S. 477 (2010) (framework for severability and presidential removal authority)
Decker Coal Co. v. Pehringer, 8 F.4th 1123 (9th Cir. 2021) (party must show the unconstitutional provision actually caused harm)
Burrell v. Colvin, 775 F.3d 1133 (9th Cir. 2014) (daily activities can support adverse credibility findings)
Ghanim v. Colvin, 763 F.3d 1154 (9th Cir. 2014) (daily activities inconsistent with alleged symptom severity may support rejecting testimony)