United States District Court, D. Delaware
GREGORY M. SLEET, District Judge.
The plaintiff Duane Erik Freeman, Sr. ("Freeman"). brought this action under 42 U.S.C. § 405(g), seeking review of a final decision by the defendant Michael J. Astrue, Commissioner of Social Security ("the Commissioner"),  denying Freeman's request for a waiver of overpayment recovery. (D.I. 7 at 17-18.) Freeman applied for disability insurance benefits ("DIB") on February 15, 1993. ( Id. at 14.) The Social Security Administration. ("SSA") granted his application on February 8, 1995, at which point he began receiving and cashing monthly DIB checks. ( Id. ) In March 2002, Freeman resumed full-time employment and notified SSA as much. ( Id. at 14, 148.) Despite his resumed work activity, Freeman continued to receive and cash DIB checks. ( Id. ) On December 18, 2006, SSA informed Freeman that, due to his resumed work activity and earnings, he had been overpaid and was obligated to refund the overpayment. ( Id. at 161-64.) Freeman requested a waiver of overpayment recovery, asserting that he was not at fault for the mistake and could not afford to repay SSA. ( Id. at 75-82.) SSA denied the request. ( Id. at 87.)
On March 11, 2010, the matter was heard before an administrative law judge ("ALJ"). ( Id. at 95, 165-94). In a decision dated April 12, 2010, ALJ Judith Showalter denied Freeman's requested waiver of overpayment recovery. ( Id. at 11-18). On February 10, 2011, the Social Security Appeals Council also denied Freeman's request to have the matter reviewed. ( Id. at 4-8). Freeman then filed this action on April 11, 2011. (D.I. 2, 3.) Presently before the court are the parties' cross-motions for summary judgment. (D.I. 13, 14.) For the reasons that follow, the court will: (1) deny Freeman's motion for summary judgment, and (2) grant the Commissioner's motion for summary judgment.
Freeman began working as a city carrier for the United States Postal Service ("USPS") in 1990. (D.I. 7 at 145, 148.) During his first year of employment, Freeman suffered a disability that rendered him unable to work full-time. ( Id. at 14.) In the wake of his disability, he received worker's compensation benefits. ( Id. ) On February 15, 1993, Freeman protectively filed an application for DIB, alleging disability as of October 18, 1990. ( Id. ) SSA approved Freeman's application on February 8, 1995, finding that he was indeed disabled as of his alleged onset date and eligible for DIB payments as of February 1992. ( Id. ) SSA sent Freeman a notice of award letter dated March 14, 1995, which included a pamphlet entitled "When You Get Social Security Disability Benefits.... What You Need To Know." ( Id. at 17.) The pamphlet explained SSA's reporting requirements in the event of resumption of work or improved health. ( Id. ) Shortly thereafter, Freeman received a lump-sum payment for retroactive benefits. ( Id. at 14.) He also began receiving monthly DIB checks moving forward. ( Id. )
SSA subsequently notified Freeman that his initial lump-sum payment was too high, due to his having received worker's compensation benefits. ( Id. ) An ALJ decision on February 2, 2000, however, determined that Freeman was not at fault and waived the overpayment recovery. ( Id. at 14, 20, 76.) Freeman continued to receive and cash monthly benefit. ( Id. at 14).
In March 2002, Freeman resumed full-time employment as a city carrier for USPS, earning a wage of $21.00 per hour. ( Id. at 147-156.) He reported earnings of $1865.27 in March 2002 and $1521.96 in April 2002. ( Id. at 149.) Freeman promptly reported his changed work status to SSA in March and April 2002, first by telephone and then by completing and returning a Work Activity Report. (D.I. 13, Ex. 1 at 1-8.) SSA acknowledged Freeman's return to work in a subsequent notice dated February 5, 2003, which included a pamphlet entitled "Working While Disabled... How Social Security Can Help, " and a request that he complete additional Work Activity Reports. (D.I. 13, Ex. 2 at 1.) Although SSA acknowledged his resumption of work, Freeman continued to receive monthly DIB for a period of more than four years after March 2002. (D.I. 7 at 14, 137-45.) According to SSA claims representative Rebecca Calloway, the mistaken payments were likely the result of a clerical error in recording Freeman's Work Activity Reports. ( Id. at 192.)
Throughout this period from 2002 to 2006, Freeman repeatedly notified SSA of his renewed employment. ( Id. at 115-36, 147-156.) Specifically, Freeman submitted Work Activity Reports in April 2002, February 2003, November 2005, and November 2006. ( Id. ) These Work Activity Reports indicated that, from March 2003 to December 2005, Freeman earned a minimum of $3395.65 per month and had no special needs pertaining to his employment performance. ( Id. at 115-20.) On several occasions, due to increases in Freeman's monthly earnings, SSA increased Freeman's DIB award amount and sent him Notices of Change in Benefits letters. ( Id. at 137-44.) Freeman continued to receive and cash DIB checks. ( Id. at 176-77.)
On December 18, 2006, SSA sent a letter to Freeman informing him that, from March 2003 through November 2006, he had been overpaid disability benefits after resuming full-time employment. ( Id. at 14, 161-64.) The letter explained that Freeman had mistakenly continued to receive benefits and had thus been paid an excess of $70, 499.00. ( Id. ) On January 16, 2007, Freeman requested a waiver of overpayment recovery, arguing that the overpayment was not his fault and that he could not afford to repay the money. ( Id. at 19-26.) He also submitted documentation indicating his household expenses. ( Id. at 27-51.) On March 5, 2007, SSA acknowledged receipt of Freeman's waiver request and asked for additional documentation of Freeman's household expenses. ( Id. at 52.) Freeman submitted additional documentation. ( Id. at 53-72.) In June 2007, SSA determined that Freeman had sufficient monthly household income- which, including his wife's income, exceeded $5000-to refund the overpayment. ( Id. at 14, 73-74.)
In March 2008, Freeman submitted a second request for a waiver of overpayment recovery, again maintaining that SSA's overpayment was not his fault, that he was financially unable to pay the money, and that it was unfair. ( Id. at 75-82.) After receiving the request, SSA determined that Freeman could afford to repay $216 per month. ( Id. at 84-85.) SSA then sent Freeman a letter informing him that his waiver request was not approved and scheduling a personal conference to determine whether he would be compelled to refund the overpayment. ( Id. at 87.)
Freeman met with an SSA claims representative on December 18, 2008. ( Id. at 88.) He reiterated his contention that he was not at fault for the overpayment because he had promptly and continuously informed SSA of his resumed work activity. ( Id. ) The claims representative advised Freeman that he should have returned the checks. ( Id. ) Freeman advised the claims representative that he wanted a hearing before an ALJ and did not wish to make payment arrangements at that time. ( Id. ) Upon conclusion of the personal conference, the claims representative completed a Waiver Determination form indicating that Freeman was at fault for the overpayment and that Freeman had sufficient means to pay back the benefits. ( Id. at 90-91.) SSA then sent a notification to Freeman officially denying his request for a waiver. ( Id. at 92-94.)
On February 3, 2009, Freeman sent SSA a timely request for a hearing before an ALJ. ( Id. at 95.) SSA acknowledged receipt of the request in a letter dated August 4, 2009, and advised Freeman of his right to representation. ( Id. at 96-102.) SSA scheduled the hearing for March 11, 2010, and again advised Freeman of his right to representation. ( Id. at 106-12.)
A video hearing before ALJ Showalter was held on March 11, 2010, as scheduled. ( Id. at 14, 165-94.) At the outset of the hearing, Freeman was again reminded of his right to legal representation. ...