On June 18, 1992, the United States District Court for the Southern District of New York issued an order approving a settlement in Stieberger v. Sullivan, which provides relief to individuals who were New York State residents at the time that their claims were denied or terminated under an SSA policy which allegedly did not require decisionmakers to apply Second Circuit case law. On July 29, 1992, the court modified the settlement.

All medical decisionmakers (and reviewers) of disability claims of New York State residents shall apply Second Circuit case law, as set forth in the settlement, in adjudicating disability claims.

The settlement requires that SSA distribute the following material to medical decisionmakers (and reviewers) of disability claims of New York State residents:

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  Stieberger settlement e:mail message (Exhibit 1, DI 12586.095).

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  Stieberger settlement agreement (one per office).

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  Manual of Second Circuit Disability Decisions.

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  Volume containing copies of Second Circuit disability decisions issued after June 18, 1992 (one per office).

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  Instructions about Second Circuit disability decisions issued after June 18, 1992, explaining each holding (optional for OHA decisionmakers and reviewers).

The Stieberger class consists of all individuals who were New York State residents at the time their claims for benefits were finally denied or terminated during the period October 1, 1981, through July 2, 1992 (the date of issuance of the Stieberger Teletype; see Exhibit 1, DI 12586.095), inclusive, based on a determination that they did not have a disability that prevented them from engaging in substantial gainful activity (SGA) and whose benefits have not been fully granted or restored through subsequent appeals.

A class member who properly responds to a Stieberger notice (see DI 12586.005) will have the opportunity to have his/her case reopened, if:

1. a. 

   He/she resided in New York State when his/her disability claim was denied or terminated for medical reasons:

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     at any level of administrative review from October 1, 1981, through October 17, 1985; or

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     at the Administrative Law Judge (ALJ) or Appeals Council (AC) level from October 18, 1985, through July 2, 1992.

      

   - AND -

    

2. b. 

   The claim discussed in a., above, was not later:

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     decided by a DDS or ALJ outside of New York State, or

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     fully allowed on appeal or reopening, or

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     affirmed on the merits in court, or

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     followed by another claim, involving the same issues and time period, which either was decided after July 2, 1992, or outside of New York State.

The following are some key points about development of Stieberger cases (also, see DI 12586.035 through DI 12586.040):

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  The settlement is intended to generally limit the DDS development to a basic period (the DEVELOPMENT PERIOD) starting 48 months before SSA's receipt of a class member's request for review and running to the present.

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  The 48 month period may be adjusted if certain exclusions apply (DI 12586.035).

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  If the individual is found not disabled during the DEVELOPMENT PERIOD and certain conditions are met, the DDS may have to develop back to the alleged onset of disability (AOD) in the earliest title II Stieberger claim, the date of filing of the earliest title XVI Stieberger claim, or to the month of cessation in cessation cases.

The following criteria define the PAYMENT PERIOD for Stieberger cases (also, see DI 12586.045 through DI 12586.050):

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  The settlement limits Stieberger payments for months prior to 12/1/91 to a period (the PAYMENT PERIOD) not to exceed 48 months.

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  The PAYMENT PERIOD will occur immediately before 12/1/91, if the individual was disabled then, unless certain payment exclusions (e.g., months class member already received benefits) require an earlier payment period.

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  Benefits are continued (or begun) after 11/30/91, if the claimant meets SSA's disability entitlement and eligibility criteria.

The Stieberger claims file(s) will be obtained only if it is necessary to develop all the way back to the AOD (or date of cessation) in the earliest title II Stieberger claim, or to the date of filing of the earliest title XVI Stieberger claim (or date of cessation).

The following presumptions apply or do not apply to a claimant's disability and insured status as indicated:

1. a. 

   If the DDS finds the class member disabled back to the start of his/ her DEVELOPMENT PERIOD (see DI 12586.035), his/her PAYMENT PERIOD ordinarily will start in 12/87 (see 8., above). The DDS is expected to establish an adjusted onset of disability by presuming that the individual was:

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     disabled as of 5 months before the first month of the PAYMENT PERIOD for title II cases involving waiting periods or, for title II non-waiting period cases and title XVI cases, the first month of the PAYMENT PERIOD.

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     insured for title II as of the presumed onset, if the individual was insured as of an earlier AOD in a Stieberger claim.

2. b. 

   In those cases where the DDS must obtain the prior file(s) and develop all the way back to the alleged onset of the earliest title II Stieberger claim, or the date the earliest title XVI claim was filed, the DDS will have the FO determine, rather than presume, insured status.

Work activity prior to 12/1/91 will be used in making determinations of initial disability but will not be used in assessing trial work months or in otherwise making determinations of SGA. NOTE: This restriction does not apply to work activity performed after 11/30/91, or while the class member was on the rolls based on another claim and the work was already counted as trial work or SGA. (See DI 12586.040 and DI 12586.060).

Apart from the retroactive relief available to certain class members (see 6. above), the settlement agreement also bars SSA from using res judicata to deny a subsequent claim if:

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  the earlier claim was medically denied or terminated at any administrative level (NYDDS or the Office of Hearings and Appeals - OHA); and

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  the earlier denial or cessation took place between 10/1/81 and 7 /2/92, inclusive; and

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  the claimant was a resident of New York State at the time of the earlier denial or cessation.

Res judicata denials (DI 27516.001 ff.) may continue to be made when the final decision on the prior claim was issued after July 2, 1992, AND the basic agency rules for res judicata are met; AND, also, where:

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  the class member was not a resident of New York State at the time of the prior administrative determination/decision rendered between 10/1/81 and 7/2/92, inclusive; OR

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  an action for judicial review or administrative appeal of the prior determination/decision was filed or would be timely if filed after July 2, 1992; OR

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  the issue(s) is non-medical; e.g., assets, income, quarters of coverage, earnings of the claimant, fraud, or whether the claimant had engaged in SGA.

Stieberger cases are usually reopened at the reconsideration level. For a complete discussion of reopening jurisdiction, see DI 12586.015 ff.