United States District Court, E.D. Kentucky, Southern Division, Pikeville
MEMORANDUM OPINION AND ORDER
R. Thapar, United States District Judge.
trust us: We're the government.” That's not
something you are supposed to hear every day. For good
reasons, the Constitution limits the government's freedom
to act simply on trust. One reason is that withholding this
freedom from the government protects the freedom of its
citizens. Alexander Hamilton, a founding father before he was
a Broadway star, put the point this way: “To bereave a
man of life . . . or by violence to confiscate his estate,
without accusation or trial, would be so gross and notorious
an act of despotism as must at once convey the alarm of
tyranny throughout the whole nation.” The Federalist
No. 84, at 512 (Alexander Hamilton) (Clinton Rossiter ed.,
1961) (quoting 1 William Blackstone, Commentaries *136; 4
id. at *438). Hence provisions like the Due Process
Clause. The main point of that clause, to put it less
eloquently than Hamilton would have, is that the government
cannot do things to you without telling you why and without
giving you a chance to speak for yourself.
the Social Security Administration (“SSA”) has
asked the Court to trust it in two ways: First, to trust that
it correctly cancelled Amy Jo Hicks's benefits without
letting a judge consider all the evidence in the record; and
second, to trust that it has correctly interpreted the Social
Security Act to require this procedure. In its previous
opinion, the Court declined both invitations. R. 36. It did
so for two reasons, one rooted in the formal principles
planted in the Due Process Clause, see id. at 7-16,
the other in the Supreme Court's newer, more functional
approach to due process, see id. at 22-31. The SSA
now asks the Court to change its opinion. R. 39.
Jo Hicks, it all started when the SSA's Inspector General
(“OIG”) found reason to believe that fraud was
involved in Hicks's application for disability benefits.
When the OIG discovers fraud, a statute requires the SSA to
“immediately redetermine” whether someone
deserves her benefits and to “disregard any evidence if
there is reason to believe that fraud” was involved in
producing that evidence. 42 U.S.C. §§
405(u)(1)(A)-(B). As the SSA has interpreted that statute,
the SSA “must disregard evidence” completely when
the OIG (rather than the SSA itself) finds reason to believe
that the evidence is fraudulent. See Social Security
Administration Hearings, Appeals, and Litigation Law
Manual (“HALLEX”) § I-1-3-25(C)(4)(a).
Thus, while redetermining her entitlements, the
administrative law judge (“ALJ”) excluded any
evidence that Hicks had submitted from her lawyer, and
alleged fraudster, Eric Conn or anyone associated with his
alleged scam. Hicks could not challenge the exclusion; under
the SSA's internal regulations, even the ALJ “d[id]
not have discretion to reconsider” whether that
evidence should have been excluded. Id. When the OIG
believes that a piece of evidence is fraudulent, that
evidence becomes invisible.
sued, arguing among other things that the redetermination
procedure violated her right to due process. R. 1 ¶ 14.
The SSA responded that the Court should defer to its
understanding of its statutory obligations; that the SSA
already provided Hicks with so many procedural safeguards
that one more would have been unnecessary; and that if the
SSA had been wrong about Hicks, she was only the
“needle in the haystack.” R. 25 at 17, 20, 27.
The Court disagreed. Due process does not permit trust; it
demands a space for doubt. Or as the Court has put it:
“When the government asserts a fact, and when that fact
affects someone's right to life, liberty, or property,
due process requires the government to let that person speak
for himself.” R. 36 at 12-13. And Hicks never got that
Rule 59 motion, the SSA does not accuse the Court of
misinterpreting the Due Process Clause. Actually, the SSA
seems to agree that due process requires meaningful hearings
and that those meaningful hearings must offer a chance to
challenge the government's factual assertions.
See R. 39 at 3-4. The SSA believes that the Court
simply misapplied that principle in this case. In support,
the SSA runs through-with great attention to detail-all the
evidence that was already in Hicks's file for the ALJ to
consider during her redetermination hearing. R. 39 at 6-11.
With four hundred pages already before the ALJ, the SSA says,
a few extra ones would not have made much difference.
Id. at 11. After all, no one complains that novels
are too short. If the Court had understood the context
correctly, the SSA believes, the Court would have realized
that Hicks has already received all the process she is due.
Id. at 12.
Rule 59(e), a court must amend its opinion if it was premised
on a “clear error of law.” GenCorp, Inc. v.
Am. Int'l Underwriters, 178 F.3d 804, 834 (6th Cir.
1999); see Fed. R. Civ. P. 59(e). The Court will
therefore consider whether either ground for its
opinion-i.e., the formal meaning or the functional
application of the Due Process Clause- was clearly erroneous.
Ground one: The Due Process Clause
The formal meaning of due process
SSA's digest of the record provides helpful context. But
context is not the point. The Court did not hold that the
SSA's redetermination procedure-specifically the
regulation that insulates the OIG's “reason to
believe” finding from review-was unconstitutional only
as applied to Hicks. The Court held that, as a
result of the regulation, the redetermination procedure was
facially unconstitutional under the Due Process
Clause. R. 36 at 31 (“[T]he redetermination process is
unconstitutional.”); id. at 32 (“But to
be clear, the Court only considers one part of the
redetermination process unconstitutional. That is the
paragraph in the HALLEX manual providing, in relevant part:
‘[A]djudicators do not have discretion to reconsider
the issue of whether the identified evidence should be
disregarded when based on an OIG referral of information or a
referral based on information obtained during a criminal or
other law enforcement investigation.'” (quoting
HALLEX § I-1-3-25(C)(4)(a))).
case that disposition was unclear before, the Court is happy
to clarify it now. Striking down a rule on its face is, of
course, an “exceptional remedy, ” Carey v.
Wolnitzek, 614 F.3d 189, 201 (6th Cir. 2010), and one
that courts should use only if they can “leave nothing
standing, ” see Speet v. Schuette, 726 F.3d
867, 872 (6th Cir. 2013) (quoting Connection Distrib. Co.
v. Holder, 557 F.3d 321, 335 (6th Cir. 2009) (en banc)).
One reason not to leave a regulation standing is if it
violates the Constitution. And as discussed here and in the
Court's previous opinion, due process requires that
people receive meaningful hearings before the government
takes away their property for good. See Mathews v.
Eldridge, 424 U.S. 319, 339-40 (1976). Although no two
hearings are alike, all “meaningful” hearings
give people an opportunity to rebut the government's
assertions about facts that affect their rights. See
R. 36 at 9-16 (touring cases that establish and apply this
rule). An internal SSA regulation forecloses that
opportunity. As such, the regulation-and consequently the
SSA's redetermination procedure-violates the
result is dictated by the formal meaning of due process. Not
to get too academic, but formalism is the basic idea that law
is a science and that all one needs to practice that science
is access to a law library. See Christopher Columbus
Langdell, Speech at the Quarter Millennial Celebration of
Harvard University, reprinted in 3 Law Q. Rev. 123,
124 (1887) (“[T]he library is . . . to us all that the
laboratories of the university are to the chemists and
physicists, all that the museum of natural history is to the
zoologists, all that the botanical garden is to the
botanists.”). Rules have a definite shape that
anyone-judges, lawyers, and average citizens alike-can
discern if they just read the relevant cases, laws, and
provisions. And the textbook definition of due process is
that a person deserves a “meaningful hearing”
before the government takes something from her. See
Armstrong v. Manzo, 380 U.S. 545, 552 (1965); see
also R. 36 at 9-16 (collecting cases).
complied with only half of that rule: Hicks got a hearing.
Due process also required that hearing to be
meaningful. To be considered meaningful, a hearing
must provide a chance “to rebut the [g]overnment's
factual assertions before a neutral decisionmaker.”
Hamdi v. Rumsfeld, 542 U.S. 507, 533 (2004). In this
case, however, the government (here played by the OIG)
asserted a fact: that some of Hicks's medical evidence
was fraudulent. Hicks then got a hearing. But she never got a
chance to rebut the OIG's factual assertion- the very