## Facts

- Gordon Stout applied for DIB and SSI, alleging disability beginning April 18, 1997 based on back and mental impairments.
- At an ALJ hearing, Stout’s sister testified that his mental impairments and behavior negatively affected his ability to work.
- Stout’s brother-in-law (a long-time employer and supervisor) submitted a statement that Stout could not perform even simple tasks without constant supervision and workplace accommodations.
- A vocational expert testified that a need for constant supervision would not be tolerated in competitive employment.
- The ALJ found Stout not disabled, concluding he could perform past relevant work as a vine pruner, but did not discuss the sister’s testimony or the brother-in-law’s statement.
- The district court affirmed, holding the ALJ’s failure to address lay testimony was harmless given Stout’s work history.
- Stout appealed to the Ninth Circuit.

## Issues

1. Whether an ALJ commits legal error by failing to address competent lay witness testimony favorable to a claimant.
2. Whether such an omission is harmless when the lay testimony, if credited, could alter the residual functional capacity assessment and the disability determination.

## Decision

- The Ninth Circuit reversed the district court and remanded with instructions to remand to the Commissioner for further proceedings.
- The court held the ALJ erred by ignoring competent lay testimony without providing germane reasons for rejecting it.
- The court held the error was not harmless because the lay evidence, if credited, could require a finding of disability given the vocational expert’s testimony about constant supervision.

## Legal Principles

- An ALJ must consider competent lay witness testimony about a claimant’s symptoms and functional limitations and may reject it only by giving germane reasons.
- In Social Security review, an error is harmless only if it is inconsequential to the ultimate nondisability determination when the record is considered as a whole.
- A reviewing court may find an omission harmless only when it can confidently conclude that no reasonable ALJ, fully crediting the ignored evidence, could reach a different disability determination.

## Conclusion

Because the ignored lay evidence described limitations (including constant supervision) that the vocational expert indicated would preclude competitive work, the ALJ’s failure to address and evaluate that evidence could have affected the disability outcome and therefore required remand for proper consideration.


Stout v. Comm'r, Soc. Sec. Admin., 454 F.3d 1050 (9th Cir. 2006)