WHEREAS the parties desire to resolve all of the claims and issues raised
in this action without the time and expense of further litigation;
NOW, THEREFORE, plaintiffs and defendants enter into this Settlement
Agreement, stipulate that it constitutes a full and complete resolution of
plaintiffs' claims, and agree to the following:
Definitions
As used in this Settlement Agreement, the following terms have the
meanings stated below:
1. “Named Plaintiffs” means plaintiff Janette L. Surrell and
plaintiff-intervenor Tammy Schutt.
2. “Plaintiffs” means the Named Plaintiffs and all members of
the Plaintiff Class (as that term is defined below), named or unnamed.
3. “Plaintiffs' Counsel” means the undersigned counsel for
the class.
4. “Defendants” means Douglas Willman, Director of the
Nebraska Disability Determinations Service, and Kenneth S. Apfel,
Commissioner of Social Security (the “Federal Defendant”), in
their official capacities, or their successors in office.
5. “SSA” means the Social Security Administration.
6. “Nebraska DDS” or “NDDS” means the Nebraska
Disability Determinations Service.
7. “Parties” means the Plaintiffs and the Defendants.
8. “Plaintiff Class” means, subject to the exclusions stated
in the last sentence of this paragraph:
all Nebraska residents who -
(1)(A) received a final reconsideration denial by the NDDS, at Step 4 or
Step 5 of the sequential evaluation process, on or after September 25,
1997, through February 8, 1999, and did not appeal the reconsideration
level denial at issue to an administrative law judge; and
(B) applied, or apply, for disability benefits under Title II, Title XVI,
or both, after February 8, 1999, through October 31, 2000 [by
amendment], and receive an allowance at the reconsideration level;
or
(2)(A) received, or receive, a final initial denial by the NDDS, at Step 4
or Step 5 of the sequential evaluation process, on or after September 25,
1997, through January 1, 2000, and did not, or do not, appeal the initial
level denial at issue to the reconsideration level; and
(B) apply for disability benefits under Title II, Title XVI, or both,
after January 1, 2000, through January 1, 2001, and receive an allowance
at the initial level; and
all Nebraska residents who meet either paragraph 8(a)(1)(A) or paragraph
8(a)(2)(A) above, and -
(1) were receiving Title II and/or Title XVI disability benefits on the
Effective Date of the Settlement Agreement; or
(2) have a claim for Title II and/or Title XVI benefits pending at any
administrative level or in federal court on the Effective Date of this
Settlement Agreement, and subsequently receive a medical allowance on that
claim; or
(3) apply for Title II and/or Title XVI benefits within one year after the
Effective Date and receive -
(i) at the reconsideration level, a res judicata
denial based on the prior denial referred to in paragraph 8(a)(1)(A);
or
(ii) at the initial level, a res judicata denial
based on the prior denial referred to in paragraph 8(a)(2)(A) above.
The Plaintiff Class excludes those individuals who (1) have already
received a subsequent award of benefits with respect to the same time
period as the denial identified in paragraph 8(a) or 8(b) above; or (2)
appealed, or appeal, all of their denials to an Administrative Law Judge,
the Appeals Council, or a court; or (3) have received a determination on
reconsideration from the NDDS after February 8, 1999, covering the same
time period as the denial identified in paragraph 8(a)(1)(A) above; or (4)
have received an initial determination from the NDDS after January 1,
2000, covering the same time period as the denial identified in paragraph
8(a)(2)(A) above; or (5) applied for children's benefits, regardless of
whether they applied under Title II or Title XVI, or both; or (6) are not
eligible for relief for reasons unrelated to disability.
9. “Class Member” or “Member of the Class” means
a person who falls within the definition of the Plaintiff Class.
10. “Effective Date” means the later of the following:
if no notice of appeal is filed from the Judgment approving this
Settlement Agreement, the day after the expiration of the time for the
filing of a notice of appeal under Rule 4 of the Federal Rules of
Appellate Procedure;
if a notice of appeal is filed, the day after the expiration of the time
for the filing of a petition for a writ of certiorari from the appellate
affirmance; or, if a petition for a writ of certiorari is filed and
granted, the date of final affirmance of the Judgment following review
pursuant to that grant; or
the date of final dismissal of any appeal from the Judgment, or the date
of final dismissal of any proceeding on a writ of certiorari granted to
review the Judgment.
11. “Judgment” means the final judgment to be rendered by the
District Court approving this Settlement Agreement.
12. “Title II” and “Title XVI” refer to Title II
and Title XVI of the Social Security Act, 42 U.S.C. §§ 301
et seq., as amended.
Prospective relief
13. The SSA and the Nebraska DDS will complete the phase-in of enhanced
documentation and explanation of disability determinations in Nebraska as
follows:
Requests for reconsideration received by the NDDS on or after February 8,
1999, will be processed under enhanced documentation and explanation
practices;
Initial requests for disability benefits received by the NDDS on or after
January 1, 2000, will be processed under enhanced documentation and
explanation practices.
14. Within ninety days after the Effective Date of this Settlement
Agreement, SSA will have completed providing training to the NDDS in the
following three areas:
Evaluation of subjective complaints and credibility;
Obtaining a proper consultative examination and report; and
Documentation of residual functional capacity assessments.
15. The training referred to in paragraph 14 above must address, at a
minium, the Commissioner's regulations at
20 C.F.R.
§§ 404.1529 and
416.929; Social
Security Rulings 82-41, 82-61, 82-62, 96-3p, 96-7p, and 96-8p; and
Polaski v. Heckler, 739 F.2d 1320 (8th Cir
1984).
16. SSA will seriously consider the input of Plaintiffs' Counsel in
setting the agenda for the training described in paragraphs 14 and 15
above. SSA will notify Plaintiffs' Counsel of the above-described training
at least one month in advance of the date any such training is scheduled
to take place. Upon request conveyed to SSA at least two weeks before any
such training, Plaintiffs' Counsel and/or their designee(s) may attend to
observe any such training session.
17. Within ninety days after the Effective Date of this Settlement
Agreement, SSA will prepare a reference guide for the NDDS to follow in
processing complex vocational cases.
18. Beginning within ninety days after the Effective Date of this
Settlement Agreement, in addition to federal quality-assurance reviews of
NDDS denials, SSA's Office of Quality Assurance and Performance Assessment
will conduct EIS (“Early Information Systems”) reviews of
disability determinations and rationales prepared by the NDDS under the
enhanced documentation and explanation practices referred to in paragraph
13 above, as follows:
Twenty-five (25) NDDS denials on reconsideration, after implementation of
enhanced documentation and explanation practices at the reconsideration
stage; and
Fifty (50) initial NDDS denials, after implementation of enhanced
documentation and explanation practices at the initial stage.
Retroactive Relief
Availability of relief
19. Any Class Member who requests redetermination as provided for herein
will receive a redetermination of the NDDS's denial of the Class Member's
claim for disability benefits, as stated below.
20. The redetermination referred to in the immediately preceding paragraph
will occur at the reconsideration level, with full administrative and
judicial review rights under 42 U.S.C. § 405(g).
21. The policies and procedures to be applied in the redetermination of
claims pursuant to this Settlement Agreement are found in the Social
Security Act, Social Security regulations, Social Security Rulings, and
the Program Operations Manual System (“POMS”). Such
redeterminations will be consistent with the Commissioner's regulations
found at 20 C.F.R.
§§ 404.1529 and
416.929 (as
amended); Social Security Rulings 96-3p, 96-7p, and 96-8p (unless
rescinded); and Polaski v. Heckler, 739 F.2d 1320
(8th Cir. 1984) (subsequent history omitted).
22. If any Class Member has received more than one denial that falls
within the definition of the Plaintiff Class in paragraph 8 above, then
all such denials will be subjected to one redetermination covering the
aggregate period of disability alleged in all such denied claims.
23. SSA will promulgate instructions, as part of the POMS, to all
personnel charged with implementing the retroactive relief of this
Settlement Agreement. SSA will provide a copy of the instructions to
Plaintiffs' Counsel prior to their distribution.
Notice of availability of relief
Mail notice
24. SSA will send individual notices to the last known addresses of
persons who fall within paragraph 8(a)(1)(A) or 8(a)(2)(A) above, inviting
such persons to file a new claim for benefits by the dates specified in
paragraphs 8(a)(1)(B) and 8(a)(2)(B) above, and informing them that, if
the new claim results in a finding of disability, they will be able to
request a redetermination of the NDDS's denial of the prior claim.
25. SSA will send a request for review form to the last known addresses of
persons who fall within paragraph 8(a)(1)(B), 8(a)(2)(B), or 8(b) above,
asking whether the Class Member wants a redetermination of the NDDS's
denial of the prior claim. The request for review form will be accompanied
by a postage-paid, pre-addressed envelope.
26. SSA will provide to Plaintiffs' Counsel copies of the notices and
forms referred to in paragraphs 24 and 25 above, prior to the distribution
of such notices and forms.
27. To receive a redetermination, a Class Member must return the request
for review form within sixty (60) days of the date on which he or she
receives the form. If a Class Member does not timely request review in
accordance with this paragraph, the prior denial will not be redetermined
absent a showing of good cause. A Class Member will be presumed to have
received the request for review five (5) days after mailing, unless the
Class Member establishes that he or she actually received the request for
review at a later date, in which case the sixty (60) days to request
redetermination shall be counted from the date of actual receipt.
Poster notice
28. Upon issuance of the POMS instructions referred to in paragraph 23
above, the Federal Defendant shall prepare a poster notice. The posters
shall inform Class Members of their potential right to redetermination of
their claims under the terms of this Settlement Agreement.
29. The Federal Defendant shall distribute posters to all SSA field
offices in Nebraska for posting in such offices. Posters shall remain
posted in the SSA field offices for a period of one hundred eighty (180)
days.
30. The Federal Defendant shall also provide a reasonable supply of
posters to Plaintiff's Counsel that Plaintiff's Counsel may post in
locations that Plaintiffs' Counsel determines would best reach potential
Class Members during the same 180-day period referred to in paragraph 29
above. This paragraph does not give Plaintiff's Counsel any right to enter
property of the United States government or the Nebraska state
government, or to display posters on property of the United States
government or the Nebraska state government other than offices of the SSA
or the Nebraska DDS.
31. Class Members not receiving notice by mail shall notify the Federal
Defendant in writing not later than ninety (90) days after the poster
display period ends, if they desire to have a claim redetermined. However,
potentially-eligible individuals who receive notice by first-class mail
shall not, by responding to the poster notice, be eligible to have the
time period extended within which they must respond.
Screening of requests for redetermination
32. SSA will decide, based on its data processing systems and/or
documentation submitted by the individual, whether a person who completes
and returns the request for review form described above is entitled to
redetermination of a past denial as described herein. If SSA decides that
a person who has completed and returned the form is not entitled to a
redetermination, SSA will send a notice of its decision to the person's
last known address, to the last known address of the person's
representative of record, if any, and to Plaintiffs' Counsel. The notice
will specify the reason or reasons for SSA's decision; will indicate that
the individual may contact Plaintiffs' Counsel if he or she wishes to
contest the decision; and will indicate the time in which the decision
must be contested, as stated in paragraph 37 below.
33. Plaintiffs' Counsel may, upon request, inspect the claim file and
other materials relied upon by SSA in making any decision that a claimant
is not entitled to a redetermination. Such files and other materials will
be made available for inspection at a mutually-agreeable time at an office
of the SSA. A request to inspect such materials will be made, in writing,
to both of the following:
Surrell Trial Attorney
Federal Programs Branch
Civil Division,
Room 986
U.S. Department of Justice
901 E Street, N.W.
Washington, DC 20530
Surrell Reviewer
Office of the General Counsel
Social Security
Administration
601 East 12th Street, Room 535
Kansas City, MO
64106
34. Absent a showing of good cause by the claimant, SSA need not make
available claim files or other materials under Part III.C. of this
Settlement Agreement, if the request to inspect such materials is
postmarked more than sixty (60) days after the claimant's receipt of the
notice described in paragraph 32 above. The claimant will be presumed to
have received the notice five days after mailing, unless the claimant
establishes that he or she actually received the notice on a later date,
in which case the 60-day period required by this paragraph will begin on
the date of actual receipt.
35. Files and materials that are made available under paragraph 33 above
will remain available for a maximum of ninety (90) days after SSA notifies
Plaintiffs' Counsel of their availability.
36. Files and materials that are made available under paragraph 33 above
will be used only for the purpose of pursuing the individual's claim
pursuant to this Settlement Agreement, or as authorized by the
claimant.
37. The Parties will negotiate in good faith to resolve any disputes as to
whether a person who has completed and returned a request for review form
is entitled to a redetermination as stated in this Settlement Agreement.
If the Parties are unable to resolve any such dispute, SSA will send to
Plaintiffs' Counsel a written confirmation of the decision that the person
is not entitled to a redetermination. Plaintiffs' Counsel may, by motion
within sixty (60) days after the written confirmation, submit the
unresolved matter to the Court for resolution.
Inspection of redeterminations by plaintiffs' counsel to ascertain
possible systemic problems
38. After one year from the Effective Date of this Settlement Agreement,
Defendants will make available for inspection by Plaintiffs' Counsel, as
stated herein, the redeterminations made by the Nebraska DDS pursuant to
this Settlement Agreement during a continuous six-month period. Such files
will be made available for inspection at a mutually-agreeable time at an
office of SSA.
39. Each file made available under the immediately preceding paragraph
will remain available for a maximum of ninety days after SSA notifies
Plaintiffs' Counsel of its availability. The files may not be removed from
the custody of SSA.
40. Plaintiffs' counsel shall send written notification of any alleged
pattern or misapplication of SSA policy that pertains to the claims
settled by this Settlement Agreement. The notification will specify the
case files upon which Plaintiffs base their allegations, and shall be sent
to both of the following:
Surrell Trial Attorney
Federal Programs Branch
Civil Division,
Room 986
U.S. Department of Justice
901 E Street, N.W.
Washington, DC 20530
Surrell Reviewer
Office of the General Counsel
Social Security
Administration
601 East 12th Street, Room 535
Kansas City, MO
64106
41. Within ninety (90) days after receipt of any written notification
specified in paragraph 40 above, SSA will complete its review of the files
identified by Plaintiffs' Counsel. The Parties will negotiate in good
faith to resolve any disputes. These negotiations will be the final
mechanism for resolution of any dispute pertaining to any issues in this
lawsuit.
Quarterly Reports
42. Beginning six months after the date that the Federal Defendant begins
sending notices with request for review forms pursuant to paragraph 25
above, the Federal Defendant shall, once each quarter, file with the Court
and serve on Plaintiffs' Counsel a status report setting forth the
following information with respect to the preceding quarter:
the number of notices with request for review forms sent pursuant to
paragraph 25 above;
the number of persons who have requested redeterminations pursuant to Part
III of this Settlement Agreement;
the number of Nebraska DDS claimants whom SSA has determined to be Class
Members eligible for redetermination;
the number of Nebraska DDS claimants determined by SSA not to be Class
Members; and
the numbers of allowances and denials in the redeterminations made
pursuant to this Settlement Agreement.
Protection of class member privacy
43. Simultaneously with this Settlement Agreement, counsel for the Parties
will execute a Stipulation and Privacy Act Protective Order to protect
the privacy of Class Member claim files and other materials made
available to Plaintiffs' Counsel under this Agreement, and to comply with
the requirements of the Privacy Act of 1974, as amended, 5 U.S.C. §
552a.
44. The Stipulation and Privacy Act Protective Order shall be submitted to
the Court within five days after its execution.
45. Plaintiffs' Counsel may not inspect claim files or other materials, as
provided for in this Settlement Agreement, until after the Court enters a
Privacy Act Protective Order in this action.
46. Notwithstanding any other provision of this Settlement Agreement,
Defendants will not make available to Plaintiffs' Counsel any materials
that are protected by 42 U.S.C. § 290dd-2, as amended, and the
regulations thereunder. Before making any files or other materials
available to Plaintiffs' Counsel under this Settlement Agreement,
Defendants will review such files and materials, and will remove any files
or documents that contain material protected by 42 U.S.C. § 290dd-2,
as amended, and the regulations thereunder.
Enforcement
47. The Court will retain jurisdiction solely for the purpose of enforcing
compliance with this Settlement Agreement. The Parties will attempt to
resolve any claim of material breach of this Agreement through
negotiations. An attempt at informal resolution will be a prerequisite to
any party's request for relief from the Court for an alleged material
breach of this Agreement. A material breach, for purposes of this
Agreement, is defined as the failure by any party, without substantial
justification, to perform a specific duty assumed under this Settlement
Agreement.
48. Before relief is sought from the Court, the following process will be
used by the Parties:
The party claiming that a material breach has occurred under this
Agreement will, within thirty (30) days after its alleged occurrence, give
notice of the claim in writing to the other Parties, and will propose a
resolution of the issue.
The other Parties will have thirty (30) days following receipt of the
written claim to respond, unless this period is enlarged by agreement of
the Parties.
If, after the thirty-day period referred to in paragraph 48(b) above, the
party asserting the claim is dissatisfied with the other Parties'
responses, or if the other Parties have not responded, then the party
asserting the claim may, after giving the other Parties fourteen (14)
days' written notice of the intent to do so, pursue relief before the
Court consistent with paragraph 47 above.
Attorneys' fees, expenses, and costs
49. Notice to the Plaintiff Class, as required by the Court, shall be at
Defendants' expense.
50. Plaintiffs' Counsel are entitled to payment of reasonable attorneys'
fees, expenses, and costs in prosecuting this action for work that
materially advanced the litigation, consistent with applicable legal
standards. In the event that the Parties cannot agree to the amount of
reasonable attorneys' fees, expenses, and costs as defined above,
Plaintiffs shall, within ninety (90) days after the Effective Date of this
Agreement, file a fee application to the Court covering the period before
execution of this Settlement Agreement.
Dismissal of the action
51. Upon the Effective Date of this Settlement Agreement, this action
shall be dismissed with prejudice, subject to paragraphs 47 and 48 above.
The relief set forth in this Agreement constitutes full and final relief
for all Class Members for claims set forth in the Plaintiffs' complaint
and complaint in intervention, as amended, or arising from the facts set
forth in the complaint or the complaint in intervention, as amended, up to
and including the Effective Date of this Agreement.
Court approval of settlement
52. Promptly after execution of this Agreement, but no later than thirty
(30) days after the Agreement is signed by counsel for all Parties (unless
such time is extended by the written agreement of Plaintiffs' Counsel and
Defendants' counsel), counsel for the Parties shall jointly submit the
following to the Court:
a joint motion for approval of this Settlement Agreement under Rule 23(e)
of the Federal Rules of Civil Procedure;
a proposed Order regarding notice to Class Members under Rule 23(e);
and
a proposed Order and Judgment approving this Settlement Agreement and
dismissing this action with prejudice, but retaining jurisdiction to
enforce compliance with this Settlement Agreement, as stated in paragraph
47 above.
53. The joint motion referred to in paragraph 52 above shall request that
the Court:
Certify the Plaintiff Class under Rule 23(b)(2) of the Federal Rules of
Civil Procedure;
Preliminarily approve this Agreement and the settlement set forth herein
as being fair, adequate, and reasonable for the Plaintiff Class;
Approve the form of Notice of Pendency and Settlement of Class Action
(“Notice”), as well as the proposed method of giving notice
to the Members of the Class by means of publication of the Notice in the
Sunday Omaha World Herald and the Sunday
Lincoln Journal Star on four successive Sundays,
beginning within twenty-one days after the Court approves the form of
Notice;
Find that such Notice constitutes the best notice practicable under the
circumstances, and constitutes valid, due, and sufficient notice to all
Members of the Class, complying fully with the requirements of Rule 23 of
the Federal Rules of Civil Procedure, the Constitution of the United
States, and any other applicable law;
Schedule the fairness hearing to be held by the Court to determine whether
the proposed settlement contained in this Agreement should be approved as
fair, adequate, and reasonable and whether the Judgment approving the
settlement should be entered;
Provide that, pending final determination of whether the settlement
contained in this Agreement should be approved, neither the Named
Plaintiffs, nor any Class Member, either directly, representatively, or in
any other capacity, will commence or prosecute any action or proceeding
in any court or tribunal asserting any of the class claims against any of
the Defendants;
Provide that any objections to the proposed settlement contained in this
Agreement or to the entry of Judgment approving the settlement shall be
heard only if, on or before a date specified in the Notice Order, persons
making objections have filed and served on all Parties notice of their
intention to appear (which will set forth each objection and the basis
therefor), along with copies of any papers in support of their objections;
and
Provide that the fairness hearing may, from time to time and without
further notice to the Plaintiff Class, be continued or adjourned by order
of the Court.
Miscellaneous provisions
54. The Parties hereby stipulate to the certification of the Plaintiff
Class under Rule 23(b)(2) of the Federal Rules of Civil Procedure.
55. With the sole exception of any claim for attorneys fees, expenses, and
costs, this Settlement Agreement completely and forever resolves,
satisfies, and releases all claims that Plaintiffs alleged or could have
alleged against any of the Defendants in connection with this action, or
against any of Defendants' departments, agencies, officers, or
employees.
56. The terms of this Settlement Agreement constitute the entire and
exclusive agreement of the Parties, and no statement, remark, agreement,
or understanding, whether oral or written, which is not contained herein,
shall be recognized or enforced. This paragraph does not apply, however,
to any agreement between the defendants regarding the payment of
Plaintiffs' attorneys' fees, expenses, and costs.
57. This Settlement Agreement shall not be construed as an admission of
the truth of any allegation or the validity of any claim asserted in this
action, and it may not be introduced or used in any proceeding other than
this action.
58. Neither the content of the negotiations leading up to this Settlement
Agreement, nor any information or communication exchanged by the Parties
in the course of those negotiations, may be offered, taken, construed, or
introduced as evidence for any purpose, neither in this action nor in any
other pending or subsequent proceeding of any kind.
59. In absence of final court approval of this Settlement Agreement
pursuant to Rule 23 of the Federal Rules of Civil Procedure, this
Agreement shall be null and void.
60. The headings in this Agreement are for the convenience of the Parties
only, and shall not limit, expand, modify, or aid in the interpretation or
construction of this Agreement.
61. The Plaintiffs' Counsel who are signatories hereto represent, warrant,
and guarantee that they are duly authorized to execute this Settlement
Agreement on behalf of Plaintiffs.
62. This Settlement Agreement is executed in triplicate, and each executed
copy will be deemed an original that is binding upon all Parties.
ATTORNEYS FOR DEFENDANT DOUGLAS WILLMAN, DIRECTOR OF NEBRASKA DISABILITY
DETERMINATIONS SERVICE
ATTORNEYS FOR DEFENDANT KENNETH S. APFEL, UNITED STATES COMMISSIONER OF
SOCIAL SECURITY
