Newman v. Apfel

The Social Security Administration (SSA) (defendant) calculated supplemental security income benefits based on the recipient’s income two months prior to the current month. In 1982 Congress enacted an exception to this method because the delay between month of calculation and month of receipt of benefits resulted in occasional overpayments. Under the exception, the SSA could calculate a recipient’s current-month needs rather than basing the recipient’s payments on her needs from two months prior. The SSA never created a rule for when the exception would apply and instead promulgated a regulation announcing that it would never apply the exception. Juanita Newman (plaintiff) was adversely affected by the SSA’s decision to never apply the exception when her income fell below the minimum income level set by the SSA for two months. Newman challenged the regulation and sought injunctive relief requiring the SSA to adopt a rule for using the exception to calculate current-month needs. The United States Court of Appeals for the Ninth Circuit held that the SSA must issue a regulation regarding the exception, but the SSA determined that there was no reliable information that could be used to calculate current-month needs as allowed by the exception. Newman challenged this determination in federal district court. The SSA argued that the district court lacked subject-matter jurisdiction to hear the case because the decision of whether to utilize the exception was within the SSA’s discretion. The district court held that it had jurisdiction to hear the case but upheld the SSA’s decision to not utilize the exception. Newman appealed.