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Cardew v. Commissioner of Social Security

United States Court of Appeals, Sixth Circuit

July 23, 2018

Bradley A. Cardew, Plaintiff-Appellant,
v.
Commissioner of Social Security, Defendant-Appellee.

          Argued: April 26, 2018

          Appeal from the United States District Court for the Eastern District of Michigan at Detroit. No. 2:16-cv-11278-Mark A. Goldsmith, District Judge.

         COUNSEL

         ARGUED:

          Stephen Sloan, DALEY DISABILITY LAW, P.C., Chicago, Illinois, for Appellant.

          Sean Santen, SOCIAL SECURITY ADMINISTRATION, Boston, Massachusetts, for Appellee.

         ON BRIEF:

          Stephen Sloan, Frederick J. Daley, Jr., DALEY DISABILITY LAW, P.C., Chicago, Illinois, for Appellant.

          Sean Santen, SOCIAL SECURITY ADMINISTRATION, Boston, Massachusetts, for Appellee.

          Before: BATCHELDER, McKEAGUE, and GRIFFIN, Circuit Judges.

          OPINION

          McKEAGUE, Circuit Judge.

         Bradley Cardew-a wheelchair-bound individual with quadriplegia-landed a short-term, highly accommodated summer internship with Lear Corporation thanks to his cousin, a vice president at Lear. But as James Agate once quipped, "Every good deed brings its own punishment." This aphorism surely resonated with Cardew, though with a twist: his cousin's good deed wrought unintended punishment on Cardew. After the internship, an administrative law judge (ALJ) denied Cardew's retroactive child disability benefits solely based on the income he received while at Lear. The ALJ reasoned (and the district court agreed) that because Cardew's earnings over three months exceeded a "bright line" threshold in the regulations, he had been "able to work at the substantial gainful activity level." But this legal framework is both incomplete and more rigid than the regulations require. Even assuming Cardew engaged in "gainful" activity, the ALJ failed to consider all the special conditions attendant to Cardew's internship that could rebut the presumption, created by his income, that he had engaged in "substantial" activity. And even assuming Cardew had exceeded the regulatory threshold after adjusting for his special conditions, the "line" does not burn so bright-adjusted income over the threshold only "ordinarily" shows that a claimant has engaged in substantial gainful activity. Accordingly, we VACATE in part the district court's judgment and REMAND for further proceedings consistent with this opinion.

         I

         At age fifteen, Bradley Cardew suffered a severe spinal injury from an accident that rendered him wheelchair-bound with C5-C6 quadriplegia. Cardew nevertheless attended Oakland University from 1999 until he graduated in 2009, though he has lived with his parents his entire life. In April 2012, Cardew sought assistance and filed an application for retroactive child disability benefits, alleging that he has been continuously disabled since November 30, 1999.[1] The Social Security Administration (SSA) denied his claim, finding Cardew ineligible because he had engaged in substantial gainful work after he turned 22-years old-solely based on a short-term, highly accommodated internship with Lear Corporation.

         In the summer of 2004, Cardew's cousin, Jason-then a vice president at Lear Corporation-secured Cardew a position as a "finance department intern" in Lear's Rochester, Michigan, office. Cardew's supervisor was a family friend who had known Jason Cardew since childhood. For this internship, Cardew's job primarily consisted of completing tasks delegated to him by three or four full-time employees. These tasks included composing and updating spreadsheets regarding client billables, reviewing bills and invoices to determine any deficiencies, and various other forms of basic office work. Over approximately a three-month period, Cardew earned $5, 502.75.

         Lear made numerous accommodations to allow Cardew to perform his work comfortably despite his disability, including: a 30-hour work week, rather than the typical 40-hour week; exemptions from menial tasks typically assigned interns that involved traveling, such as picking up coffee or lunch, or attending meetings; exemptions from clerical tasks because of his difficulty with typing; and more frequent breaks to adjust his position in his wheelchair, in order to avoid skin ulcers and use the restroom. Lear also modified three doors to be wheelchair-accessible at a cost to Lear of $4, 000. Lear's vice president of human resources determined that Cardew was approximately "35% less productive" than other summer interns, though his pay was not reduced for his lower productivity.

         According to Cardew, "[t]he internship ended like it was supposed to" at the end of the term. Cardew noted that his cousin had informally offered to have him back the following year, but that opportunity never came to fruition because an economic downturn caused Lear to cut back the intern program. And, in fact, Cardew was again informally approached by his cousin in 2011 about returning to work for Lear in a full-time capacity, but that opportunity also fell through, mostly due to Cardew's physical limitations and the demands of full-time employment.

         Cardew testified at length before the ALJ and submitted documentary evidence to support his claim for benefits. The issue before the ALJ was limited to whether any of Cardew's employment constituted "substantial gainful activity" under the applicable social security regulations, thereby precluding benefits. The ALJ ultimately denied Cardew's claim for benefits. She found that Cardew had engaged in "substantial gainful activity" during his three-month internship at Lear. Further, the ALJ held that Cardew had not established that his internship was an unsuccessful work attempt, or that employer subsidies or impairment-related work expenses reduced his earnings below the regulatory threshold. In particular, the ALJ held that "the costs incurred by Lear in adapting the workplace to suit the claimant's needs," i.e., the installation of the handicap-accessible automatic doors, "are not impairment-related work expenses because they were not a cost paid by the claimant."

         Cardew sought review from the SSA's Appeals Council. The Appeals Council denied his request, finding that there was no basis to overturn the ALJ's decision. Therefore, the ALJ's decision became the Commissioner's final decision in this case. See 20 C.F.R. § 404.981. Cardew then sued the Commissioner in the U.S. District Court for the Eastern District of Michigan. See 42 U.S.C. § 405(g). The case was assigned to a magistrate judge for a report and recommendation.

         The magistrate judge first found that the Lear internship was substantial gainful activity under the pertinent regulation because it was the type of work that is typically done for pay or for profit; that the internship was not an unsuccessful work attempt since it did not end because of the removal of any special conditions; and that, after reducing Cardew's countable earnings by 35%, his income was still higher than the $810 minimum threshold for substantial gainful activity in 2004. Though describing the result as "harsh," the magistrate judge held that the ALJ correctly excluded the $4, 000 cost incurred by Lear in installing handicap-accessible doors in his work area because substantial evidence supported the ALJ's conclusion that it was an impairment-related work expense borne by Lear, and not a subsidy deductible from Cardew's earnings. Therefore, the magistrate judge recommended that the district court affirm the ALJ's decision.

         Cardew timely filed several objections to the magistrate judge's report. The district court overruled Cardew's objections adopted the magistrate judge's recommendation. Cardew now appeals.

         II

         We generally review the ALJ's decision under the deferential substantial-evidence standard. Biestek v. Comm'r of Soc. Sec., 880 F.3d 778, 782-83 (6th Cir. 2017). If the ALJ's decision is supported by "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion," the decision will generally stand. Richardson v. Perales, 402 U.S. 389, 401 (1971). If such evidence exists, the court should defer "even if there is substantial evidence in the record that would have supported an opposite conclusion." Blakley v. Comm'r of Soc. Sec., 581 F.3d 399, 406 (6th Cir. 2009) (quoting Key v. Callahan, 109 F.3d 270, 273 (6th Cir. 1997)). But we review legal questions de novo, including whether the ALJ applied the appropriate legal standard. See id. at 407; Smith v. Comm'r of Soc. Sec., 482 F.3d 873, 876 (6th Cir. 2007). That is, "if the ALJ commits an error of law, the court must reverse and remand, 'even if the factual determinations are otherwise supported by substantial evidence and the outcome on remand is unlikely to be ...


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