Stepp v. Colvin
795 F.3d 711
| 7th Cir. | 2015Background
- Sheila Stepp (b. 1962) applied for Social Security Disability Insurance alleging degenerative disc disease and depression with onset Nov. 18, 2009; she underwent multiple spinal surgeries and pain treatments between 2009–2011.
- Treating and consulting records were mixed: some physicians (Dr. Ritter, state consultants) found improvement and cleared or limited her to sedentary/light work, while others (Dr. McCormick, pain specialists) at times gave work‑preclusive opinions or reported substantial pain.
- ALJ denied benefits (Nov. 21, 2011), finding severe impairments but that Stepp retained capacity for sedentary work based on record evidence and vocational expert testimony identifying alternative jobs.
- After the ALJ decision, Stepp submitted new treatment notes (Sept.–Oct. 2011) from pain specialist Dr. Allan MacKay to the Appeals Council showing ongoing severe pain, additional degenerative findings on MRI, nerve blocks, and a planned cervical fusion.
- The Appeals Council denied review summarily, stating it had considered the additional evidence but that it did not provide a basis for changing the ALJ’s decision; it listed Dr. MacKay’s records as an exhibit but did not explicitly analyze them.
- The district court affirmed the ALJ on the merits but (initially) remanded to let the ALJ consider Dr. MacKay’s records; after a Rule 59(e) motion the court amended its judgment; on appeal the Seventh Circuit affirmed the ALJ’s substantive ruling but reversed and remanded because the Appeals Council erred in treating the MacKay records as non‑qualifying.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether ALJ’s RFC/findings were supported by substantial evidence | Stepp: ALJ ignored/discounted treating opinions, manipulative limitations, obesity, and credibility of her testimony | Comm’r: ALJ reasonably weighed conflicting opinions, credibility, and medical evidence; decision supported by substantial evidence | ALJ’s RFC decision was supported by substantial evidence (affirmed in part) |
| Whether Appeals Council treated Dr. MacKay’s notes as "new and material" under 20 C.F.R. §404.970(b) | Stepp: MacKay notes were new, time‑relevant, and material; Appeals Council erred by failing to consider them | Comm’r: Listing of the exhibit and boilerplate language show Council accepted and considered the notes but found they did not change the result | Court treated Council’s silence as a rejection of the evidence as non‑qualifying and reviewed that legal determination de novo; found Council erred |
| Whether MacKay notes are “new” | Stepp: Notes were created after the hearing and not available to her then | Comm’r: Delay in submission criticized but not dispositive | Court: Notes were new—created after the hearing and reasonably submitted shortly thereafter |
| Whether MacKay notes are “material” (would likely change outcome) | Stepp: Notes contradict ALJ’s premise of improvement and show severe, ongoing degeneration and planned fusion | Comm’r: Notes insufficient to alter ALJ’s conclusion | Court: Notes were material because they undermined the ALJ’s finding of improvement and could reasonably change the outcome; remand required |
Key Cases Cited
- Craft v. Astrue, 539 F.3d 668 (7th Cir. 2008) (describing SSA five‑step sequential evaluation)
- Elder v. Astrue, 529 F.3d 408 (7th Cir. 2008) (standard for substantial evidence review)
- Perkins v. Chater, 107 F.3d 1290 (7th Cir. 1997) (when Appeals Council explicitly addresses new evidence, its decision is discretionary and unreviewable)
- Farrell v. Astrue, 692 F.3d 767 (7th Cir. 2012) (Ambiguous Appeals Council boilerplate may be read as rejecting new evidence; such legal determinations are reviewable)
- Eads v. Sec’y of HHS, 983 F.2d 815 (7th Cir. 1993) (ALJ need not weigh evidence never presented to him; limits district court review if Appeals Council deemed evidence qualifying)