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IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ALASKA

DIANE E. HUGHES, CLARENCE O.

HUGHES,
Case No. 3:20-cv-281 RRB
Plaintiffs,
VS. ORDER ALLOWING PLAINTIFFS
TO APPLY TO WITHDRAW
KILOLO KIJAKAZI, Acting APPLICATIONS

Commissioner of Social Security,

Defendant.

Plaintiffs, Diane and Clarence Hughes, proceeding pro se, filed a Complaint
alleging that Social Security Administration (SSA) employees failed to give them complete
and accurate information to make informed decisions regarding Social Security Retirement
when they filed their Early Social Security Retirement applications in 2006 and 1993.
Plaintiffs wish to withdraw one or both of their applications and refile pursuant to SSA’s
established procedure for doing so.!

The facts and applicable law are discussed in more detail in the Order at
Docket 13. Briefly, Plaintiffs complain that the SSA Claims Representatives who assisted

them in 1993 and 2006 failed to provide information critical to making an informed

' Docket 1.

INFORMATION

Hughes v. Social Security Administration 	Case No. 3:20-cv-281 RRB
Order Allowing Plaintiffs to Apply to Withdraw Applications 	Page 2
retirement decision and, as a result, they both took Early Retirement resulting in a
significant loss of income compared to other retirement options that were available.2
Plaintiffs say they have attempted since 2016 to resolve the issue, and “wish to withdraw
and refile their Social Security Options.”3 	An unfavorable ALJ decision issued on
March 25, 2021, concluding that SSA employees did not provide misinformation to
Plaintiffs, and that Mrs. Hughes “cannot withdraw her 2006 application for retirement
benefits and retroactively refile for retirement benefits,” because on December 8, 2010, the
Agency established a 12-month time limit, from the first month of entitlement, for the
withdrawal of retirement applications.4
Noting that this matter had languished in the system for far too long, and that
it turned on a relatively straightforward legal question, the Court offered relevant legal
analysis sua sponte.5 In summary, before December 8, 2010, the SSA allowed retirement
beneficiaries to withdraw their retirement application, for any reason and at any point in
time, and refile it at a later date. The Court noted that at least two courts have found that
the 12-month time limit was “impermissibly retroactive” as applied to individuals similarly
situated to Plaintiffs.6 The Court explained that regulations cannot be applied retroactively
2 Docket 1. They estimate a loss between $120,000 and $140,000.
3 Dockets 1-1, 11. Plaintiffs alternatively seek to recoup their alleged damages by seeking relief
under 20 CFR § 404.633(c), alleging damages as a result of misinformation provided by SSA employees.
Id. 4 Docket 11-8 at 3, citing 20 CFR § 404.623; compare 20 C.F.R. § 404.640 (Effective December 8,
2010) and 20 CFR 404.640 (Effective to December 7, 2010).
5 Docket 13.
6 See Low v. Berryhill, 334 F. Supp. 3d 1165, 1170 (W.D. Wash. 2018) (finding 12-month time
limit impermissibly retroactive as applied to Plaintiff); Terwilleger v. Comm’r of Soc. Sec., 2019 WL
336877, at *7 (S.D. Ohio Jan. 28, 2019), report and recommendation adopted sub nom., Terwilliger v.
Comm’r of Soc. Sec., 2019 WL 1317880 (S.D. Ohio Mar. 22, 2019).
Case 3:20-cv-00281-RRB Document 21 Filed 11/12/21 Page 2 of 9

Hughes v. Social Security Administration 	Case No. 3:20-cv-281 RRB
Order Allowing Plaintiffs to Apply to Withdraw Applications 	Page 3
unless several conditions are met, and that generally the SSA does not have any authority
to engage in retroactive rule-making.7
The ALJ did not address the fact Diane Hughes first filed for retirement in
2006, before the 12-month restriction, and this Court concluded that the ALJ improperly
applied the new regulation retroactively to Plaintiffs. When considering a Social Security
administrative appeal, this Court “must affirm the Commissioner’s decision if it is
supported by substantial evidence and if the Commissioner applied the correct legal
standards.”8 Accordingly, this Court concluded that “reversal of the ALJ is warranted due
to a purely legal error.”9 	The Court stated that “it appears that Plaintiffs are entitled to
withdraw and refile their retirement applications which were filed prior to December 8,
2010, pursuant to the SSA’s established procedure,” but gave Defendant the opportunity
to respond before ruling.10
Without specifically conceding the issue of retroactivity, the Commissioner
agrees 	that 	remand 	is 	required 	in 	this 	case, 	but 	disagrees 	that 	Plaintiffs 	should
“automatically” be allowed to withdraw and refile their applications. 	Instead, the
Commissioner submits that this Court should remand this matter to the Appeals Council,
which in turn “will instruct the ALJ to conduct efforts to develop the record and evaluate
7 Docket 13, citing Kokal v. Massanari, 163 F. Supp. 2d 1122, 1134 (N.D. Cal. 2001) and Low v.
Berryhill, 334 F. Supp. 3d 1165, 1170 (W.D. Wash. 2018) (“Congress generally has not granted the SSA
retroactive rulemaking authority.).
8 Larson v. Saul, 967 F.3d 914, 922 (9th Cir. 2020) (citing Holohan v. Massanari, 246 F.3d 1195,
1201 (9th Cir. 2001)).
9 Moreover, this Court concluded that “a decision based upon this straightforward legal analysis
of the regulation eliminates the need to wade into the murky waters of ‘misinformation,’ which would be
intensely factual and unnecessarily time-consuming.” Docket 13 at 13.
10 Id.
Case 3:20-cv-00281-RRB Document 21 Filed 11/12/21 Page 3 of 9

Hughes v. Social Security Administration 	Case No. 3:20-cv-281 RRB
Order Allowing Plaintiffs to Apply to Withdraw Applications 	Page 4
whether Plaintiffs meets all requirements in accordance with 20 C.F.R. § 404.640(b)(1)-
(3) to withdraw and refile their applications.”11 	Thus, the Commissioner argues that
“further factfinding on the part of the ALJ is required,” because the regulations “contain
additional requirements before an application may be withdrawn.”12
According to 20 C.F.R. § 404.640 (effective until December 7, 2010),
applications such as Plaintiffs’ could be withdrawn if four conditions were met:
• 	A written request for withdrawal is filed at a place described in § 404.61413
by the claimant or a person who may sign an application for the claimant
under § 404.612;14
• 	The claimant is alive at the time the request is filed;15
• 	Any other person whose entitlement would be rendered erroneous because
of the withdrawal consents in writing to it;16 and
• 	All benefits already paid based on the application being withdrawn are repaid
or we are satisfied that they will be repaid.17
The Commissioner correctly identifies a flaw in the Court’s prior statement that “it appears
that Plaintiffs are entitled to withdraw and refile their retirement applications . . . pursuant
to the SSA’s established procedure.”18 	A more accurate statement is that Plaintiffs are
entitled to apply to withdraw their retirement applications, pursuant to the SSA’s
11 Docket 20.
12 Id.
13 “[A]n application for benefits, or a written statement, request, or notice is filed on the day it is
received by an SSA employee at one of our offices or by an SSA employee who is authorized to receive it
at a place other than one of our offices.” 20 C.F.R. § 404.614(a).
14 20 C.F.R. § 404.640(a)(1).
15 20 C.F.R. § 404.640(a)(2).
16 20 C.F.R. § 404.640(b)(2).
17 20 C.F.R. § 404.640(b)(3). The regulation is silent as to what is satisfactory evidence of future
repayment.
18 Docket 13 at 13.
Case 3:20-cv-00281-RRB Document 21 Filed 11/12/21 Page 4 of 9

Hughes v. Social Security Administration 	Case No. 3:20-cv-281 RRB
Order Allowing Plaintiffs to Apply to Withdraw Applications 	Page 5
established procedure. But the Court disagrees with the remainder of the Commissioner’s
arguments.
The procedure the Commissioner suggests could take months, if not years,
to complete. 	Plaintiffs are now 76 and 91 years old.19 	In light of the requirement of 20
C.F.R. § 404.640(a)(2), time is of the essence. Moreover, according to the SSA website,20
an individual wishing to withdraw their retirement application simply must fill out Social
Security Form SSA-521, and “send the completed form to your local Social Security office.
We will notify you when there is a decision about your request and let you know the amount
of benefits you need to repay.”21 The two-page form contains checkboxes for SSA use in
the event that “benefits not repaid” or “consent(s) not obtained” prevents approval of the
request.22 But there is no requirement that an ALJ “conduct efforts to develop the record
and evaluate whether Plaintiffs meet all requirements.” A signature of an “SSA Employee”
such as “Claims Authorizer” is all that is required for approval. 	However, there is no
indication on the form as to how long the SSA may take to consider the application, the
fact that the decision is not made locally, how the supplemental information is obtained by
SSA, 	or the possibility that once the form is submitted, 	existing payments could
immediately cease pending a decision.
While administrative procedure may require this Court to remand to the ALJ,
nothing prevents Plaintiffs from promptly filing their applications without waiting for
19 As of May 3, 2021. Docket 11.
20 https://www.ssa.gov/benefits/retirement/planner/withdrawal.html#how (Last visited Novem-
ber 10, 2021).
21 A copy of this form is attached to this Order.
22 20 C.F.R. § 404.640(b)(2) and (3).
Case 3:20-cv-00281-RRB Document 21 Filed 11/12/21 Page 5 of 9

Hughes v. Social Security Administration 	Case No. 3:20-cv-281 RRB
Order Allowing Plaintiffs to Apply to Withdraw Applications 	Page 6
“permission” from the ALJ to do so.23 Plaintiffs’ rights to file withdrawal applications are
not contingent on the ALJ’s blessing. Rather, Plaintiffs currently have this right for reasons
explained in this Court’s prior Order. 	But nothing about this Court’s analysis considers
whether an application to withdraw and refile is in the Plaintiffs’ best interests. 	That
decision is between Plaintiffs and their financial, tax, legal, and any other advisors.
Plaintiffs are correct that they should have been permitted to apply to withdraw their
applications under the pre-December 10, 2010, rules, but whether or not it is wise to do so
remains up to them.
CONCLUSION
In light of the foregoing, it is hereby ordered as follows:
1. 	The 	ALJ’s 	March 	25, 	2021, 	decision 	is 	REVERSED 	and
REMANDED based upon legal error with respect to the retroactivity of 20 C.F.R. § 404.640
(Effective December 8, 2010);
2. 	The Court makes no findings with respect to the ALJ’s conclusion that
SSA employees did not provide misinformation to Plaintiffs; and
3. 	This matter will be held open for 60 days. 	If no further filings are
received, it will be DISMISSED WITHOUT PREJUDICE at that time.24
23 Plaintiffs may wish to attach copies of this Court’s orders to any SSA-521 application.
24 The Supreme Court defines “dismissal without prejudice” as “dismissal without barring the
plaintiff from returning later, to the same court, with the same underlying claim.” 	Semtek Int’l Inc. v.
Lockheed Martin Corp., 531 U.S. 497, 505, 121 S. Ct. 1021, 1027, 149 L. Ed. 2d 32 (2001).
Case 3:20-cv-00281-RRB Document 21 Filed 11/12/21 Page 6 of 9

Hughes v. Social Security Administration 	Case No. 3:20-cv-281 RRB
Order Allowing Plaintiffs to Apply to Withdraw Applications 	Page 7
IT IS SO ORDERED this 12th day of November, 2021, at Anchorage,
Alaska.
/s/ Ralph R. Beistline
RALPH R. BEISTLINE
Senior United States District Judge
Case 3:20-cv-00281-RRB Document 21 Filed 11/12/21 Page 7 of 9

Form SSA-521 (11-2018) UF

Discontinue Prior Editions Page 1 of 2
Social Security Administration TOE 420 OMB No. 0960-0015
REQUEST FOR WITHDRAWAL OF APPLICATION Do not write in this space

IMPORTANT NOTICE - This is a request to withdraw your application. If we approve it, the
decision we made on your application will have no legal effect. You will forfeit all rights attached
to an application, including the rights of appeal. You will have to return any payment we made to
you or anyone else on the basis of that application. You must then reapply if you want a
determination of your Social Security rights at any time in the future. Any subsequent application
may not involve the same retroactive period. We intend for you to use this procedure only when
your decision to file has resulted, or will result, in a disadvantage to you. Your local Social
Security office will be glad to explain whether, and how, this procedure will help you.

NAME OF WAGE EARNER, SELF-EMPLOYED INDIVIDUAL, OR ELIGIBLE SOCIAL SECURITY NUMBER
INDIVIDUAL

IF DIFFERENT, PRINT YOUR NAME (First name, middle initial, last name) YOUR SOCIAL SECURITY NUMBER
TYPE OF BENEFIT YOU WANT TO WITHDRAW DATE OF APPLICATION | IF APPLICABLE, DO YOU WANT TO KEEP

MEDICARE BENEFITS? [_] Yes [_] No

| hereby request the withdrawal of my application, dated as above, for the reasons stated below. | understand that (1) this request
may not be cancelled after 60 days from the mailing of notice of approval; and (2) if a determination of my entitlement has been
made, there must be repayment of all benefits paid on the application | want withdrawn, and all other persons whose benefits
would be affected must consent to this withdrawal. | further understand that the application withdrawn and all related material will
remain a part of the records of the Social Security Administration and that this withdrawal will not affect the proper crediting of
wages or self-employment income to my Social Security earnings record.

Give reason for withdrawal. (if you need more space, use the reverse of this form.)

1. [_] lintend to continue working. (| have been advised of the alternatives to withdrawal for applicants under full retirement
age and still wish to withdraw my application.)

2. [_] Other (Please explain fully):

[_] Continued on reverse

SIGNATURE OF PERSON MAKING REQUEST
Signature (First name, middie initial, last name) (Write in ink) Date (Month, day, year)

SIGN
HERE

Mailing Address (Number and Street, Apt. No., P.O. Box, or Rural Route)

Telephone Number (include area code)

City and State ZIP Code Enter Name of County (if any) in which you now live

Witnesses are required ONLY if this request has been signed by mark (X) above. If signed by mark (X), two witnesses to
the signing who know the person making the request must sign below, giving their full addresses.

1. Signature of Witness 2. Signature of Witness

Address (Number and Street, City, State and ZIP Code) Address (Number and Street, City, State and ZIP Code)

FOR USE OF SOCIAL SECURITY ADMINISTRATION

BECAUSE REPAID OBTAINED (Attach special determination)
SIGNATURE OF SSA EMPLOYEE TITLE [_] OTHER (Specify) DATE
O CLAIMS
AUTHORIZER

Case 3:20-cv-00281-RRB Document 21 Filed 11/12/21 Page 8 of 9

Form SSA-521 (11-2018) UF Page 2 of 2
Additional Remarks:

Privacy Act Statement
Collection and Use of Personal Information

Sections 202, 205, 223 and 1872 of the Social Security Act, as amended, allow us to collect this information. Furnishing us this
information is voluntary. However, failing to provide us with all or part of the information may cause continued consideration of
your benefits claim.

We will use the information you provide to cancel your application for benefits. We may also share your information for the
following purposes, called routine uses:

* To student volunteers and other workers, who technically do not have the status of Federal employees, when they are
performing work for Social Security Administration (SSA) as authorized by law, and they need access to personally
identifiable information in SSA records in order to perform their assigned agency functions; and

* To contractors and other Federal agencies, as necessary, for the purpose of assisting SSA in the efficient administration
of its programs.

In addition, we may share the information in accordance with the Privacy Act and other Federal laws. For example, where
authorized, we may use and disclose this information in computer matching programs, in which our records are compared with
other records to establish or verify a person’s eligibility for Federal benefit programs and for repayment of incorrect or delinquent
debts under these programs.

A list of additional routine uses is available in our Privacy Act System of Records Notice (SORN) 60-0089, entitled Claims Folders
Systems, as published in the Federal Register (FR) on April 1, 2003, at 68 FR 15784. Additional information and a full listing of all
our SORNs are available on our website at www,ssa.gov/privacy.

Paperwork Reduction Act Statement - This information collection meets the requirements of 44 U.S.C. § 3507, as amended by
Section 2 of the Paperwork Reduction Act of 1995. You do not need to answer these questions unless we display a valid Office of
Management and Budget contro! number. We estimate that it will take about 5 minutes to read the instructions, gather the facts,
and answer the questions. SEND OR BRING THE COMPLETED FORM TO YOUR LOCAL SOCIAL SECURITY OFFICE. You
can find your local Social Security office through SSA's website at www.socialsecurity.gov. Offices are listed under U.S.
Government agencies in your telephone directory or you may call Social Security at 1-800-772-1213

(TTY 1-800-325-0778). You may send comments on our time estimate above to: SSA, 6401Security Bivd., Baltimore, MD
21235-6401. Send only comments relating to our time estimate to this address, not the completed form.

Case 3:20-cv-00281-RRB Document 21 Filed 11/12/21 Page 9 of 9