FOR PUBLICATION
  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

PRISCILLA VASQUEZ,                             No. 06-16817
                 Plaintiff-Appellant,             D.C. No.
                 v.
                                              CV-05-03857 JW
MICHAEL J. ASTRUE, Commissioner                 ORDER AND
of Social Security,                              AMENDED
               Defendant-Appellee.
                                                 DISSENT

        Appeal from the United States District Court
          for the Northern District of California
          James Ware, District Judge, Presiding

                  Argued and Submitted
          May 15, 2008—San Francisco, California

                    Filed November 5, 2008
                     Amended July 8, 2009

            Before: Diarmuid F. O’Scannlain and
          Michael Daly Hawkins, Circuit Judges, and
              James V. Selna,* District Judge.

                   Opinion by Judge Selna;
                Concurrence by Judge Hawkins;
                 Dissent by Judge O’Scannlain




  *The Honorable James V. Selna, United States District Judge for the
Central District of California, sitting by designation.

                               8397
                     VASQUEZ v. ASTRUE                 8401




                        COUNSEL

James Hunt Miller, Oakland, California, for the plaintiff-
appellant.

John C. Cusker, Special Assistant United States Attorney,
Office of the General Counsel, Social Security Administra-
tion, San Francisco, California, for the defendant-appellee.
8402                  VASQUEZ v. ASTRUE
                           ORDER

   The opinion issued on November 5, 2008 is amended by
inserting the following after the first paragraph of Judge
O’Scannlain’s dissent on page 15123:

       Subsequent to our decision in this case, the gov-
    ernment petitioned for rehearing en banc, arguing
    that the crediting-as-true rule is invalid because it is
    contrary to both statute and Supreme Court prece-
    dent. Vasquez did not respond to the government’s
    arguments in detail, and so I do not opine whether
    the government is right. However, the case appears
    strong. The government asserts that under the Social
    Security Act, the Commissioner — not a federal
    court — is the factfinder. See 42 U.S.C. § 405(g)
    (findings of Commissioner are conclusive so long as
    substantial evidence supports them). While the stat-
    ute prohibits a claimant’s testimony concerning pain
    or other symptoms alone from establishing a disabil-
    ity, this appears to be exactly what the crediting-as-
    true rule would require. Cf. 42 U.S.C. § 523(d)(5)(A)
    (“An individual’s statement as to pain or other symp-
    toms shall not alone be conclusive evidence of dis-
    ability as defined in this section; there must be
    medical signs and findings . . . which show the exis-
    tence of a medical impairment . . . which could rea-
    sonably be expected to produce the pain or other
    symptoms alleged and which, when considered with
    all evidence . . . would lead to a conclusion that the
    individual is under a disability.” (emphasis added)).
    The government notes that the general rule (subject
    to “rare” exceptions) “is to remand to the agency for
    additional investigation or explanation.” INS v. Ven-
    tura, 

, 16 (2002) (per curiam). We do not
    credit-as-true in only “rare” cases; according to the
    government, we took some factfinding responsibility
                  VASQUEZ v. ASTRUE                       8403
away from the Commissioner in at least twenty-two
cases during 2007 and 2008.

   The government finally notes that other circuits
will remand for determination of benefits only in
narrow circumstances. See, e.g., Faucher v. Sec’y of
Health & Human Servs., 

, 176 (7th Cir.
1994) (“If a court determines that substantial evi-
dence does not support the Secretary’s decision, the
court can reverse the decision and immediately
award benefits only if all essential factual issues
have been resolved and the record adequately estab-
lishes a plaintiff ’s entitlement to benefits.”); see
also Miller v. Chater, 

(10th Cir. 1996)
(remanding for a fifth administrative hearing, but
warning that “the Secretary is not entitled to adjudi-
cate a case ad infinitum until [he] correctly applies
the proper legal standard and gathers evidence to
support [his] conclusion” (internal quotation marks
omitted)). If, as the government argues, crediting-as-
true is a de facto finding of disability, then our cir-
cuit’s precedent is badly misaligned with that of
other circuits.

   Of course, because the crediting-as-true rule is
part of our circuit’s law, only an en banc court can
change it. Although no judge has chosen to call for
en banc rehearing in this case, I am hopeful that the
en banc court will consider the argument when it is
presented more directly in another case (e.g., one
where there is an explicit remand for immediate pay-
ment of benefits based on the rule). Because the
crediting-as-true rule applies in every case where a
court finds no substantial evidence to support the
Commissioner’s decision, the issue is of exceptional
importance. This is particularly so because the “So-
cial Security hearing system is probably the largest
adjudicative agency in the western world.” Heckler
8404                  VASQUEZ v. ASTRUE
    v. Campbell, 

, 461 (1983) (noting that
    2.3 million claims for disability benefits were filed
    in 1981).

                               II

  Judge O’Scannlain has voted to grant the petition for
rehearing en banc and Judge Selna has so recommended.
Judge Hawkins has voted to deny the petition for rehearing en
banc.

   The full court has been advised of the petition for rehearing
en banc and no active judge has requested a vote on whether
to rehear the matter en banc. Fed. R. App. P. 35.

  The petition for rehearing en banc is DENIED. No further
petitions for rehearing or rehearing en banc may be filed.


                          OPINION

SELNA, District Judge:

                         OVERVIEW

   Priscilla Vasquez (“Vasquez”) appeals from the district
court’s grant of summary judgment for the Commissioner of
Social Security (“the Commissioner”) upholding a denial of
Disability Insurance Benefits under 42 U.S.C. § 401 et seq.
and Supplemental Security Income benefits under 42 U.S.C.
§ 1381 et seq. Vasquez claims that the Commissioner improp-
erly discounted her symptom reporting, failed to consider evi-
dence of her severe mental impairment, and improperly
applied principles of res judicata.

   We vacate the district court’s judgment and remand to the
Commissioner for a hearing on the issue of whether Vasquez
is entitled to benefits.
                     VASQUEZ v. ASTRUE                  8405
                FACTUAL BACKGROUND

   Vasquez applied for Disability Insurance Benefits and Sup-
plemental Security Income benefits in September 1997, alleg-
ing an inability to work since October 1995 because of low
back pain and other musculoskeletal impairments. The appli-
cation was denied initially and again on reconsideration. At
the initial hearing, Administrative Law Judge (“ALJ”) Rich-
ard Stacy (“ALJ Stacy”) also found that Vasquez was not dis-
abled and denied her application. The decision of ALJ Stacy
discussed Vasquez’s back injuries and limited education, but
did not discuss whether Vasquez may have also suffered from
cognitive impairments because Vasquez did not raise that
issue in her application. The Social Security Administration
(“SSA”) Appeals Council denied review of ALJ Stacy’s deci-
sion.

   Vasquez subsequently filed a new application for benefits,
alleging an inability to work since November 2001. After the
Commissioner denied her application, she requested an ALJ
hearing. Vasquez’s application specified that she suffered
from ongoing problems due to a back injury, as well as cogni-
tive impairments resulting in significant learning problems.

   ALJ Sandra Rogers (“ALJ Rogers,” or “the ALJ”) found
that while Vasquez was not able to perform her past work as
a housekeeper due to a “severe” back disorder, she retained
the residual function capacity to perform “light exceptional
work activity” and therefore was not disabled. Although ALJ
Rogers did not make any explicit findings regarding
Vasquez’s alleged cognitive impairments, she discussed the
mental health and capacity evidence presented, and seems to
have implicitly found that these impairments were not “se-
vere” and/or did not impact Vasquez’s residual function
capacity.

  In appealing this decision to the SSA Appeals Council,
Vasquez presented additional evidence of psychological test-
8406                 VASQUEZ v. ASTRUE
ing from Dr. Ubaldo Sanchez (“Dr. Sanchez”) to bolster her
claims of cognitive impairment. The Appeals Council
reviewed the ALJ’s findings as well as the additional evi-
dence and found that Dr. Sanchez’s report did not warrant any
change in the ALJ’s decision. The district court affirmed the
ALJ’s decision when it granted summary judgment in favor
of the Commissioner and declined to set aside the ALJ’s
denial of benefits.

                       DISCUSSION

Standard of Review

   We review the district court’s order affirming denial of
benefits de novo. Schneider v. Comm’r of Soc. Sec. Admin.,

, 973 (9th Cir. 2000). It may “set aside the Com-
missioner’s denial of benefits when the ALJ’s findings are
based on legal error or are not supported by substantial evi-
dence in the record as a whole.” 

means more than a mere scintilla but less than a preponder-
ance; it is such relevant evidence as a reasonable mind might
accept as adequate to support a conclusion.” Andrews v. Sha-
lala, 

, 1039 (9th Cir. 1995). This Court “re-
view[s] the administrative record as a whole” to determine
whether substantial evidence supports the ALJ’s decision. 

is responsible for determining credibility, resolving
conflicts in medical testimony, and for resolving ambigui-
ties.” 

evidence is susceptible to more than
one rational interpretation,” the ALJ’s decision must be
affirmed. 

Credibility of Vasquez’s Symptom Reporting

  Vasquez argues that ALJ Rogers did not properly credit her
symptom reporting when she found that Vasquez’s allegations
as to the “intensity, persistence, and limits effects of [her]
symptoms were not well supported by the probative evidence
and [were] not wholly credible.”
                       VASQUEZ v. ASTRUE                    8407
   [1] In evaluating the credibility of a claimant’s testimony
regarding subjective pain, an ALJ must engage in a two-step
analysis. Lingenfelter v. Astrue, 

, 1035-36 (9th
Cir. 2007). “First, the ALJ must determine whether the claim-
ant has presented objective medical evidence of an underlying
impairment which could reasonably be expected to produce
the pain or other symptoms alleged.” 

(internal cita-
tions and quotation marks omitted). The claimant is not
required to show that her impairment “could reasonably be
expected to cause the severity of the symptom she has
alleged; she need only show that it could reasonably have
caused some degree of the symptom.” 

v.
Chater, 

, 1282 (9th Cir. 1996)). If the claimant
meets the first test and there is no evidence of malingering,
the ALJ can only reject the claimant’s testimony about the
severity of the symptoms if she gives “specific, clear and con-
vincing reasons” for the rejection. 

that she is in “chronic pain.” She stated
that it “hurts to sit in chairs” and “hurts walking.” In the pain
questionnaire she filled out as part of her benefits application,
she specified that she feels a “stabbing pain” in her back,
which spreads to her legs and toes, brought on by movement
and seeming to worsen when she sits or walks, “everyday
throughout the day.” Complaints of ongoing, unrelieved pain
were also recorded by her physicians and incorporated in
Vasquez’s medical reports.

  [2] After finding that Vasquez “has a back disorder which
is a severe impairment,” the ALJ acknowledged that
Vasquez’s injuries “could reasonably be expected to produce
some of the pain and other symptoms alleged.” (Emphasis
added.) This satisfied the first prong of the ALJ’s inquiry
regarding the credibility of Vasquez’s complaints. See Lin-

.

   The ALJ went on, however, to reject Vasquez’s allegations,
stating:
8408                        VASQUEZ v. ASTRUE
       after carefully considering all of the medical and
       documentary evidence, the undersigned finds that, in
       light of discrepancies between the claimant’s asser-
       tions and information contained in the reports of the
       treating and examining physicians, the allegations by
       the claimant as to the intensity, persistence, and lim-
       iting effects of his [sic] symptoms were not well sup-
       ported by the probative evidence and are not wholly
       credible. The claimant’s complaints regarding the
       frequency, severity and duration of her back pain
       and lower extremity pain are not consistent with the
       objective medical evidence and are generally consis-
       tent [sic] with the limitations found.

   [3] This statement does not comport with the requirements
laid out by the Court in 

. The
ALJ did not cite any evidence of malingering, and therefore,
her adverse credibility findings may only be supported by
“specific, clear and convincing reasons.” 

ALJ made no specific findings in support of her conclusion
that Vasquez’s claims were not credible, other than the vague
allegation that they were “not consistent with the objective
medical evidence.”1
  1
   Although the Court in Lingenfelter rejected the ALJ’s substantive
grounds for rejecting the claimant’s testimony, the opinion suggests the
level of detail and specificity required:
         In finding a consensus, the ALJ cited to the three state agency
      physicians, the two doctors who examined Lingenfelter for the
      California Workers’ Compensation Appeals Board, and Dr.
      Ovadia, who each made findings consistent with a capacity for
      sedentary work. Without explanation, however, the ALJ com-
      pletely ignored the medical opinions of Lingenfelter’s two pri-
      mary treating physicians, who expressly corroborated his alleged
      pain and limitations and found him incapable of any work.

(emphasis in original). Here, there was no
level of comparable analysis from which we could evaluate the sufficiency
of the credibility determination.
                          VASQUEZ v. ASTRUE                         8409
   [4] To support a lack of credibility finding, the ALJ was
required to “point to specific facts in the record which demon-
strate that [Vasquez] is in less pain than she claims.” Dodrill
v. Shalala, 

, 918 (9th Cir. 1993). The Commis-
sioner’s argument that the “ALJ found that Claimant’s com-
plaints were inconsistent with the findings reported by Drs.
Capen and Singh” is not supported by the record. The cited
portion of the ALJ’s opinion does discuss the findings of Drs.
Capen and Singh, but the ALJ did not discuss these findings,
or any specific medical evidence when she rejected Vasquez’s
subjective complaints of pain.2

   The Commissioner’s argument that the ALJ’s findings
were proper under 20 C.F.R. §§ 404.1529(c)(3) and
416.929(c)(3)3 is similarly incorrect. Both regulations deal
with evidence the Commissioner should consider in determin-
ing how a claimant’s symptoms may affect her capacity to
function under the guidelines; neither describe what findings
are required before an ALJ can reject a claimant’s allegations
of disabling pain.4 In any event, it does not appear that the
ALJ complied either with the requirements laid out by this
Court, see 

; 

, or its own regulations, see §§ 404.1529(c)(3) and
  2
     Moreover Dr. Capen’s findings would be an inadequate basis for dis-
counting Vasquez’s symptom reporting given that the ALJ specifically
found that “Dr. Capen’s opinion is not supported by the overall evidence
of the record” and not “afforded significant weight in the deci-
sion[ ]making process.” (ER 26.)
   3
     References to all regulations are to Title 20 of the Code of Federal
Regulations, last updated in 2006. No relevant changes were made to any
regulations between the time the ALJ heard Vasquez’s case and the last
update to the regulations.
   4
     Sections 404.1529(c)(3) and 416.929(c)(3) merely state that the ALJ
will consider any evidence presented by the claimant regarding her subjec-
tive symptoms, and list some relevant factors that may be included in
assessing the impact of those symptoms. Neither section states what find-
ings are required before an ALJ may discredit a claimant’s subjective
reports of pain.
8410                       VASQUEZ v. ASTRUE
416.929(c)(3), in assessing Vasquez’s subjective complaints
of disabling pain.

   [5] The appropriate judicial response in situations where
the ALJ fails to give an adequate justification for rejecting a
claimant’s pain testimony was first discussed in Varney v.
Secretary of Health and Human Services (Varney II), 

, 1398-99, 1401 (9th Cir. 1988). There, we adopted
the Eleventh Circuit’s credit-as-true rule, holding that the
Commissioner must accept, as a matter of law, a claimant’s
subjective pain testimony if the ALJ fails to articulate suffi-
cient reasons for refusing to credit it. 

hold-
ing in Varney II was specifically limited to cases “where there
are no outstanding issues that must be resolved before a
proper disability determination can be made, and where it is
clear from the administrative record that the ALJ would be
required to award benefits if the claimant’s excess pain testi-
mony were credited.” Id at 1401.

   [6] Since Varney II, a split in authority has developed over
whether the rule is mandatory or discretionary in this Circuit.
Compare, e.g., Lester v. Chater, 

, 834 (9th Cir.
1995) (holding that when an ALJ improperly rejects a claim-
ant’s testimony regarding his limitations, and the claimant
would be disabled if his testimony were credited, the testi-
mony must be credited as a matter of law); with Connett v.
Barnhart, 

, 876 (9th Cir. 2003) (discussing the
Circuit’s conflicting case law and holding that the doctrine is
not mandatory because the court has “some flexibility in
applying the crediting as true theory” (internal quotation
marks omitted)). It is not necessary for us to resolve the con-
flict at this time, however, because, unlike Varney II or Les-
ter, here there are outstanding issues that must be resolved
before a proper disability determination can be made.5 See
  5
    This is the distinction which the dissent fails to perceive in suggesting
that only an en banc panel may properly resolve this case. That would cer-
tainly be true if we applied the credit-as-true rule because no further find-
                          VASQUEZ v. ASTRUE                          8411
Varney II at 

(declining to address whether the
credit-as-true rule should be adopted in cases where a remand
for further proceedings is required before a disability determi-
nation can be made); 

(holding that the
credit-as-true rule is mandatory, but only where the claimant
would be disabled if his testimony were credited).

   [7] This Court has recognized that there are other factors
which may justify application of the credit-as-true rule, even
where application of the rule would not result in the immedi-
ate payment of benefits. In Hammock v. Bowen, 

(9th Cir. 1989), we compared the limited application of the
credit-as-true rule in Varney II with the rule in the Eleventh
Circuit, which credits the claimant’s pain testimony whenever
the ALJ fails to articulate its reasons for doing so. 

(citing Hale v. Bowen, 

, 1012 (11th Cir. 1987)).
Without adopting a general rule, we found that, because
claimant was of advanced age and had already experienced a
severe delay in her application, it was appropriate to apply the
credit-as-true rule in that case. 

. We applied the rule
even though we remanded for a further determination of
whether benefits were due, and in doing so instructed the ALJ
to credit the claimant’s symptom testimony. 

-04.

   [8] Similar facts are present in this case. Vasquez filed her
application for benefits in October 2002. At present, she is 58
years old. Further, as we noted in Varney II, the purpose of
the credit-as-true rule is to discourage ALJs from reaching a
conclusion about a claimant’s status first, and then attempting
to justify it by ignoring any evidence in the record that sug-
gests an opposite result. Varney 

. By

ings are required on remand. United States v. Hardesty, 

,
1348 (9th Cir. 1992) (en banc) (per curiam). But that is not this case, and
it is no “dodge” to avoid a choice among rules which this case does not
require. (Dissent at 8428-29 n.2.) To be sure, orderly development of the
Circuit’s law in this area might benefit from an en banc review (see 

but not because this case compels it.
8412                      VASQUEZ v. ASTRUE
requiring the ALJ to specify “any factors discrediting a claim-
ant at the first opportunity,” the rule ensures that pain testi-
mony is carefully assessed, and helps prevent unnecessary
duplication in the administrative process. 

all these reasons, we follow Hammock in applying
the credit-as-true rule in this instance. On remand, the ALJ is
instructed to accept Vasquez’s symptom testimony as true in
determining whether she is entitled to benefits.

Evidence Vasquez was Severely Impaired

   [10] In the five-step sequential process used to evaluate an
applicant’s disability status, step two consists of determining
whether a claimant has a “medically severe impairment or
combination of impairments.” Bowen v. Yuckert, 

, 140-41 (1987). Vasquez argues that the ALJ’s finding of
no mental impairment was improper and not supported by
substantial evidence. We hold that the ALJ should have been
afforded an opportunity to consider additional evidence gen-
erated between the ALJ’s decision and the Appeals Council
hearing, and remand for that purpose.

   The medical evidence confirms at least some degree of
cognitive impairment. In February 2004, Owen Lum, M.D.
(“Dr. Lum”) interviewed and evaluated Vasquez without
administering any tests. Dr. Lum diagnosed Vasquez as hav-
ing “adjustment disorder with mixed moods” and assessed a
Global Assessment of Functioning (“GAF”) Level of 67. This
number indicates an assessment of mild symptoms and some
difficulty functioning.6 Assessing her functional capacity, Dr.
  6
    American Psychiatric Association, Diagnostic and Statistical Manual
of Mental Disorders, Fourth Edition Text Revision (2000) (“DSM IV-
TR”), p. 34 (describing the GAF scale and noting that a level between 60
and 70 indicates a patient with “some mild symptoms” or “some difficulty
in social, occupational, or school functioning,” but who is “generally func-
tioning pretty well, [and] has some meaningful interpersonal relation-
ships”).
                      VASQUEZ v. ASTRUE                   8413
Lum wrote that Vasquez is able to perform simple and repeti-
tive tasks, and in the absence of major psychiatric problems,
could perform detailed tasks. He stated that she “is able to
accept instructions from supervisors and interact with
coworker[s] and the public,” and further, that she could “work
on a consistent basis” and “attend a regular work situation[,]
secondary to the absence[ ] of major cognitive deterioration.”

   The month after Dr. Lum’s interview, Vasquez was inter-
viewed and tested by psychologist Ute Kollath, Ph.D. (“Dr.
Kollath”). Dr. Kollath administered WMS-III, WAIS-III and
Bender-Gestalt examinations. She reported that Vasquez’s IQ
score was a 62, placing her in the “mildly mentally retarded
range”; however, Dr. Kollath further stated that “this appears
to be an underestimate of her intellectual level of functioning
and variable motivation might account for this.” Her clinical
impression was that Vasquez placed in “at least the borderline
range.” Her Global Measure of Impairment (“GMI”) score
was less than 50, which demonstrates a memory in the “im-
paired range”; however, Dr. Kollath reported that this score
“appears to be an underestimate of her memory functioning”
because she was “able to recall some, detailed autobiographi-
cal information.”

   Dr. Kollath stated that her overall impression was “of an
individual who could well have cognitive impairment,” but
stated that Vasquez’s “limited engagement towards the testing
process interfered with a full assessment.” Dr. Kollath diag-
nosed an “Adjustment Disorder with Depressed Mood,”
“Learning Disorder NOS,” and a GAF of 60. This GAF score
indicates “moderate symptoms” or moderate difficulty in “so-
cial, occupational, or school functioning.” DSM IV-TR, p. 34.
She specifically noted that Vasquez appeared “to be able to
maintain concentration, persistence, and pace,” was able to
“relate well in the interview and would be able to appropri-
ately interact with supervisors and co-workers in a job set-
ting.” She found her able to perform “simple repetitive tasks,”
but “unable to perform detailed and complex tasks.”
8414                       VASQUEZ v. ASTRUE
   The ALJ referenced the findings of Drs. Lum and Kollath
in her decision, though she made no specific findings regard-
ing Vasquez’s mental health. In assessing the objective evi-
dence of impairment obtained from Dr. Kollath’s testing, the
ALJ noted Dr. Kollath’s observations that the scores were
likely “underestimates of her true abilities.”

  After the ALJ issued her decision denying benefits,
Vasquez was seen by Dr. Sanchez for further psychological
evaluation and testing. Vasquez argues that this additional
evidence, which she submitted to the Appeals Council, clearly
demonstrates that she did suffer from a mental impairment
during the relevant time period.7

   Dr. Sanchez reviewed Vasquez’s records and administered
the following examinations: WAIS-III adult intelligence
scale; WMS-III memory scale; 3(WRAT3) wide range
achievement test; Reyes 15 Items; and a mental status exami-
nation. His report noted that she put forth “full effort” during
the evaluation, demonstrated no indication of malingering
during the Reyes 15 Items test, and “appeared as a credible
claimant.”

   Dr. Sanchez’s report indicates that Vasquez’s Full Scale IQ
score is a 65, which “indicates that she is currently function-
ing in the mentally retarded range of measured intelligence.”
It further states that,

        all of her scores fall within the borderline and
      mentally retarded range indicating limited general
      verbal intelligence; conceptual thinking; numeric
      manipulation; immediate auditory recollection; gen-
  7
    Because this evidence was submitted to and considered by the Appeals
Council, and is part of the administrative record, this Court may consider
it in reaching its final decision even though the ALJ did not have the bene-
fit of this information during the initial application hearing. Bilby v. Schw-
eiker, 

, 718 n.2 (9th Cir. 1985).
                      VASQUEZ v. ASTRUE                      8415
    eral knowledge; social judgment, common sense,
    reality awareness, judgment in practical situation;
    limited ability to differentiate between essential and
    non-essential details; limited capacity for sustained
    effort, attention, concentration and mental efficiency
    ...

   Her scores on the memory examination demonstrated “sig-
nificantly below average memory skills.” Dr. Sanchez
assessed that Vasquez could read at a third grade level, spell
at a fourth grade level, and perform arithmetic at a first grade
level. He diagnosed “Major Depressive Disorder,” “Pain Dis-
order,” “Reading Disorder,” “Disorder of Written Expres-
sion,” “Mathematics Disorder,” and “Borderline Intellectual
Functioning,” with an overall GAF of 49. The GAF score
indicates an assessment that Sanchez suffered from “serious
symptoms” or a serious “impairment in social, occupation, or
school functioning.” DSM IV-TR, p. 34.

  Dr. Sanchez further stated that while Vasquez “would not
have any difficulty being socially appropriate, “[s]he would
have moderate difficulty in concentrating, focusing and keep-
ing up with the pace of a working environment given [her]
preoccupation with pain and her current level of emotional
functioning.” He stated that she was “viewed as being able to
perform simple and repetitive tasks,” but was not able to
determine whether she would be able to tolerate the stress of
an 8-hour day, 40-hour week on a consistent basis.

   Dr. Sanchez’s report suggests that Vasquez may suffer
from cognitive impairments. While Dr. Kollath reported
Vasquez’s IQ score at 62, she noted that the score “appear[ed]
to be an underestimate of her intellectual level of function-
ing.” She further stated that while Vasquez appeared to be an
“individual who could well have cognitive impairment,” her
“limited engagement towards the testing process interfered
with a full assessment.” In comparison, Dr. Sanchez reported
that Vasquez was a “credible claimant” and found that
8416                  VASQUEZ v. ASTRUE
Vasquez’s IQ was slightly higher (a Full Scale score of 65)
but still within the “mentally retarded range of measured
intelligence.”

   [11] If credited, Dr. Sanchez’s statements could certainly
support a finding of mental impairment. His report plainly
states that Vasquez has “significantly below average memory
skills,” and test scores indicating limited social judgment,
common sense, capacity for sustained effort, attention and
mental efficiency. Further, his GAF assessment indicates “se-
rious symptoms” or a “serious impairment in social, occupa-
tion, or school functioning.” See DSM IV-TR, p. 34.

   The Commissioner argues that Dr. Sanchez’s findings are
contrary to the evidence presented to the ALJ (e.g., the testi-
mony of Drs. Lum and Kollath), and therefore, should not be
credited. However, if the Appeals Council had remanded the
case for additional review, Dr. Sanchez’s findings would have
enhanced the information available to the ALJ and provided
additional, rather than contradictory, evidence of Vasquez’s
condition.

   Though the ALJ expressed some hesitancy regarding the
credibility of Dr. Kollath’s findings, as explained above, Dr.
Sanchez arrived at a similar diagnosis. Because Dr. Sanchez’s
findings are based on objective clinical tests, and buttressed
by his statement that Vasquez appeared to be a credible claim-
ant, they could be sufficient to show a mental impairment. See
Magallanes v. Bowen, 

, 751 (9th Cir. 1989)
(quoting Miller v. Heckler, 

, 849 (9th Cir. 1985)
(where a “nontreating physician’s opinion rests on objective
clinical tests, it must be viewed as substantial evidence”)).
Moreover, to the extent Drs. Kollath and Sanchez’s testimony
supports a finding of mental impairment that would not have
been supported by Dr. Lum’s testimony, the Court may con-
clude that the evidence is not actually contradictory, because
Dr. Lum did not perform any of the clinical tests on which
Drs. Kollath and Sanchez based their opinions.
                           VASQUEZ v. ASTRUE                           8417
   [12] When viewed as a whole, the medical reports suggest
that Vasquez may suffer from a cognitive impairment.
Because the ALJ did not have access to Dr. Sanchez’s reports
in deciding otherwise, she also did not account for Vasquez’s
mental impairments in determining her residual functioning
capacity at step four of the disability determination. See
§ 404.1523 (noting that where a claimant has a combination
of impairments, “the combined impact of the impairments
will be considered throughout the disability determination
process”); § 404.1545 (noting that where a claimant has more
than one impairment, the SSA will consider all of them, even
those that are not severe, in determining the claimants residual
functioning capacity).

   Neither party has presented any argument regarding how
Vasquez’s impairments would affect a determination of her
residual functioning capacity under the guidelines.8 Thus,
there are no facts presented that clearly indicate the proper
outcome of steps four and five of the disability determination
evaluation. For this reason, the Court cannot find Vasquez
disabled and order an immediate payment of benefits. See
Harman v. Apfel, 

, 1178-79 (9th Cir. 2000)
(allowing an immediate award of benefits directed when,
among other things, it is clear from the record that the ALJ
would be required to find the claimant disabled if the evi-
dence is credited). Rather, in cases such as these, “where the
testimony of the vocational expert has failed to address a
claimant’s limitations as established by improperly discred-
ited evidence,” this Circuit has “consistently . . . remanded for
further proceedings rather than payment of benefits.” 

we remand to allow the ALJ to consider
Dr. Sanchez’s reports in determining whether Vasquez suffers
from a mental impairment, and to consider how these limita-
  8
   Vasquez did not argue that she meets a disability “listing” for mental
impairment on appeal, so that she is only entitled to benefits, if at all, if
she is determined to be disabled at step five of the sequence.
8418                  VASQUEZ v. ASTRUE
tions affect her residual functioning capacity and ability to
perform other work at steps four and five of the disability
determination sequence.

Res Judicata

   [14] “[T]he principle of res judicata should not be rigidly
applied in administrative proceedings.” Lester v. 

(citing Gregory v. Bowen, 

, 666 (9th
Cir. 1988)). Normally, an ALJ’s findings that a claimant is
not disabled “creates a presumption that the claimant contin-
ued to be able to work after that date.” 

(quoting

). However, the presumption does not
apply “where the claimant raises a new issue, such as the exis-
tence of an impairment not considered in the previous appli-
cation.” 

Lester, the Court found that the Commissioner
could not apply res judicata principles to an earlier ALJ deci-
sion in determining a claimant’s eligibility where the claimant
(1) alleged a mental impairment not raised in his earlier appli-
cation and (2) turned 50 after the date of the earlier decision
and thus entered the “approaching advanced age” category as
defined by the applicable regulations. 

The facts in
this case are exactly parallel to Lester in that Vasquez did not
raise the issue of her mental impairment during her 1997
application before ALJ Stacy, but did raise the issue during
her 1999 application before ALJ Rogers.

   [16] Additionally, Vasquez turned 50 after the date of ALJ
Stacy’s decision and entered the “closely approaching
advanced age” category. Thus, ALJ Rogers improperly
applied res judicata. ALJ Rogers explicitly noted that she
gave “weight to the prior determination of [ALJ] Stacy” in
reaching her determination, and because Vasquez was unable
to provide evidence of “changed circumstances,” applied prin-
ciples of res judicata in her decision. However, because
Vasquez raised a new issue not before ALJ Stacy and entered
                           VASQUEZ v. ASTRUE                            8419
the “closely approaching advanced age” category, it was
improper for ALJ Rogers to apply a presumption of continu-
ing non-disability when deciding Vasquez’s second applica-
tion. See 

   [17] Where an ALJ has committed legal error, this Court
may set aside the Commissioner’s denial of benefits. Schnei-

. However, for the reasons outlined
above, we believe that, after crediting Vasquez’s pain testi-
mony and taking into account the evidence of her mental
impairment, the ALJ should make a determination as to
Vasquez’s residual functioning capacity and entitlement to
benefits in the first instance. The ALJ is further instructed that
the principles of res judicata are not applicable in this case,
and therefore, that ALJ Stacy’s previous decision is not enti-
tled to any degree of deference in the ultimate decision as to
whether Vasquez is entitled to an award of benefits.

                             CONCLUSION

   We grant Vasquez’s petition and remand with instructions
to remand to the Commissioner for a further determination of
whether benefits are due.

  VACATED AND REMANDED. Costs on appeal to
Appellant.
  9
    The Commissioner argues that because ALJ Roger’s found “no severe
mental impairment,” Vasquez could not establish “changed circum-
stances” during the relevant period. This argument is irrelevant, because
as noted above, a claimant defeats the presumption of continuing non-
disability by raising a new issue in a later application. See 

. To the extent the Commissioner’s argument implies that res judi-
cata is barred only when an applicant establishes a new, severe impairment
in a later proceeding, the argument is circular. As the Court explained in
Lester, all an applicant has to do to preclude the application of res judicata
is raise a new issue in the later proceeding. See 

of course,
be little point in saying that a claimant raising a new issue can escape the
presumption of continuing non-disability, but only after the claimant has
already proven the impairment is severe.
8420                     VASQUEZ v. ASTRUE
HAWKINS, Circuit Judge, concurring:

                   I.         INTRODUCTION

   This case involves application of the so-called “credit-as-
true” rule. When an Administrative Law Judge (“ALJ”)
makes an adverse credibility finding with respect to a wit-
ness’s testimony in a Social Security case, he or she “must
make specific findings justifying that decision.” Hammock v.
Bowen, 

, 502 (9th Cir. 1989) (citing Varney v.
Sec’y of Health and Human Servs. (Varney I), 

,
584 (9th Cir.), modified on reh’g, 

(Varney II)
(9th Cir. 1988); Cotton v. Bowen, 

, 1407 (9th
Cir. 1986)). According to the credit-as-true rule, when an ALJ
fails to provide specific, articulable reasons to support an
adverse credibility finding, this court should “ ‘not remand
solely to allow the ALJ to make specific findings regarding
that testimony. Rather, [it should] take that testimony to be
established as true.’ ” 

).

   I concur with the entirety of Judge Selna’s opinion, includ-
ing application of the credit-as-true rule in this case. In the
dissent’s view, however, there is an internal conflict among
Ninth Circuit case law that makes resolution of the credit-as-
true issue impossible here. I write separately to clarify why
application of the credit-as-true rule is appropriate and why
this case does not present an opportunity for en banc review
of the conflict identified by the dissent.

                        II.    DISCUSSION

   This court first articulated the credit-as-true rule in Varney
II, 

. There we stated that when an ALJ has not
provided specific reasons for disbelieving a claimant’s testi-
mony, a credibility hearing is “insufficient, in itself, to war-
rant further proceedings.” 

Thus
                       VASQUEZ v. ASTRUE                     8421
    [i]n cases where there are no outstanding issues that
    must be resolved before a proper disability determi-
    nation can be made, and where it is clear from the
    administrative record that the ALJ would be required
    to award benefits if the claimant’s excess pain testi-
    mony were credited, we will not remand solely to
    allow the ALJ to make specific findings regarding
    that testimony.

Instead, the testimony will be “established as
true” as a matter of law, and the case will be remanded with
instructions to grant benefits. 

panel concluded that “the ‘crediting as true’ doc-
trine is [not] mandatory in the Ninth Circuit.” Connett v.
Barnhart, 

, 876 (9th Cir. 2003). Surveying con-
flicting cases, Connett determined that there was “no other
way to reconcile” those cases than to hold that “[i]nstead of
being a mandatory rule, we have some flexibility in applying
the ‘crediting as true’ theory.” 

Accordingly, the
court declined to enter judgment instructing the ALJ to award
benefits and instead remanded the case for the sole purpose of
determining “whether Connett’s testimony should be credited
as true.” 

II and Connett do appear to be in conflict
over the applicability of the credit-as-true rule where there is
no other reason to remand the case to the ALJ, this case does
not and should not provide an opportunity to resolve that dis-
pute en banc. Varney II expressly “reserve[d] judgment as to
whether to follow the [credit-as-true] rule in cases in which a
remand is required for other reasons.” 

no conflict
over the credit-as-true rule as applied to cases that require
remand for other reasons. Because this case requires remand
regardless of application of the credit-as-true rule, it does not
implicate any conflict between Varney II and Connett.

  We first addressed the question left open by Varney II in
Hammock v. Bowen, 

(9th Cir. 1989), where we
8422                  VASQUEZ v. ASTRUE
considered a case in which further proceedings other than a
credibility determination were necessary before benefits could
be granted. There, we “extend[ed] Varney II to cover the pres-
ent case because the delay experienced by Hammock has been
severe and because of Hammock’s advanced age.” 

.
We therefore “accept[ed] as a matter of law” the truth of the
claimant’s testimony and remanded for further proceedings.

argues that Hammock also conflicts with Con-
nett. That would be true only if Hammock announced a bind-
ing extension of Varney II’s credit-as-true rule to all cases in
which an ALJ had not provided specific reasons for disbeliev-
ing a claimant’s testimony, regardless whether further pro-
ceedings other than a credibility determination were required.
Hammock has not and cannot be interpreted so broadly.

   To support its claim of a conflict in this case, the dissent
asserts that because “disabilities disproportionately affect
older individuals,” any effort to limit Hammock’s holding to
the facts of that case is “unavailing.” It also cites Lester v.
Chater, 

(9th Cir. 1995), Harman v. Apfel, 

(9th Cir. 2000), and Benecke v. Barnhart, 

(9th Cir. 2007), to argue that later panels of this court
have interpreted Hammock broadly to apply to all cases,
regardless of the need for remand. Dissent at 8428-29 & n.2.
Neither of these arguments holds water.

   First, Hammock says in plain language that the credit-as-
true rule should apply only in “the present case because the
delay experienced by Hammock has been severe and because
of Hammock’s advanced 

(emphasis
added). Nothing in Hammock indicated the court intended to
establish a rule applicable beyond the limited factual context
of that particular case. The dissent’s empirical observation
that the factors motivating Hammock are common to most
Social Security cases does not render that court’s decision
logically categorical. It only makes it more likely that future
                       VASQUEZ v. ASTRUE                     8423
panels will exercise their discretion to apply the credit-as-true
rule when remand is necessary for other reasons. (This is one
such case.) That Social Security claimants are commonly
elderly and their benefits typically delayed is therefore beside
the point.

   Nor do Lester, Harman, and Benecke provide a basis for
concluding otherwise. The dissent argues that Lester stands
for the broad proposition that “[w]here the Commissioner
fails to provide adequate reasons for rejecting [testimony], we
credit that [testimony] ‘as a matter of law,’ 

,
regardless of the need for remand on other issues. Dissent at
8429. Setting aside whether such an expansive interpretation
of that statement has any merit, it simply was not relevant to
the outcome of that case. There, after applying the credit-as-
true rule, the Lester panel “remand[ed] for payment of bene-
fits” because no other proceedings were necessary. 

Thus, even assuming arguendo that Lester concluded Ham-
mock extended Varney II across the board, that conclusion
had no bearing on the result in that case and is therefore non-
binding dicta. See Coalition of Clergy, Lawyers, and Profes-
sors v. Bush, 

, 1166 (9th Cir. 2002) (analysis
that is “in no way relevant to any holding” is “dicta [which]
does not bind [future] panel[s] of this court”).

   Harman provides even less support for the conclusion that
Varney II has been extended to all cases like this one. There,
we expressly addressed the circumstances under which “evi-
dence should be credited and an immediate award of benefits
directed.” 

(emphasis added). We
concluded that testimony should be credited as true only when

    (1) the ALJ has failed to provide legally sufficient
    reasons for rejecting such evidence, (2) there are no
    outstanding issues that must be resolved before a
    determination of disability can be made, and (3) it is
    clear from the record that the ALJ would be required
8424                  VASQUEZ v. ASTRUE
    to find the claimant disabled were such evidence
    credited.

v. Chater, 

, 1292 (9th
Cir.1996)). In conformity with Varney II, we determined that
if these three elements were met, “then remand for determina-
tion and payment of benefits [would be] warranted regardless
of whether the ALJ might have articulated a justification for
rejecting [the testimony].” 

concluded, application
of the rule was not appropriate in that particular case because
the vocational expert had not addressed the limitations posed
by the conditions sought to be established by application of
the rule. 

Accordingly, “[t]he appropriate remedy
. . . [was] to remand this case to the ALJ.” 

Harman
demonstrates anything, it is that Hammock established judicial
discretion to apply (or not apply) the credit-as-true rule in
cases where remand is necessary for other reasons. Certainly
it cannot be read to mean what the dissent claims—that we
must apply the credit-as-true rule in cases where remand is
necessary for other reasons.

   Benecke is also readily distinguishable. The dissent is cor-
rect to note that the Benecke panel “appl[ied] the crediting-as-
true rule and only then discuss[ed] whether there were ‘out-
standing issues that must be resolved before a determination
of disability [could] be made . . . .’ ” Dissent at 8428 n.1
(quoting 

). It would be dubious at
best, however, to interpret Benecke’s misconstruction of the
Harman test as a binding extension of Varney II to cases in
which remand is still necessary. But in any event, again
assuming arguendo that such an interpretation had merit, it
still would be non-binding dicta since the Benecke court “con-
clude[d] that there are no outstanding issues that must be
resolved before a determination of disability can be made”
and remanded with instructions to grant benefits. 

-95 (emphasis added).
                      VASQUEZ v. ASTRUE                    8425
                    III.   CONCLUSION

   According to Hammock, we are free to exercise our discre-
tion (but not required) to apply the credit-as-true rule in this
case. This conclusion conflicts with neither Varney II nor
Connett. Whatever the merits of the claim that the en banc
court should resolve the conflict between Varney II and Con-
nett, this case simply does not provide an opportunity for
doing so.



O’SCANNLAIN Circuit Judge, dissenting:

   Because I believe that this Circuit’s precedents cannot be
reconciled, I must respectfully dissent from that part of the
court’s opinion (slip op. at 8410-12) that discusses the
crediting-as-true rule. In my view, this issue can only be
resolved by the court en banc. I do agree with the court’s
treatment of the remaining issues, including its conclusion
that the Administrative Law Judge improperly rejected
Vasquez’s testimony and that the case should be remanded for
consideration of Vasquez’s ability to perform other work dur-
ing steps four and five of the disability determination process.

   Subsequent to our decision in this case, the government
petitioned for rehearing en banc, arguing that the crediting-as-
true rule is invalid because it is contrary to both statute and
Supreme Court precedent. Vasquez did not respond to the
government’s arguments in detail, and so I do not opine
whether the government is right. However, the case appears
strong. The government asserts that under the Social Security
Act, the Commissioner — not a federal court — is the fact-
finder. See 42 U.S.C. § 405(g) (findings of Commissioner are
conclusive so long as substantial evidence supports them).
While the statute prohibits a claimant’s testimony concerning
pain or other symptoms alone from establishing a disability,
this appears to be exactly what the crediting-as-true rule
8426                  VASQUEZ v. ASTRUE
would require. Cf. 42 U.S.C. § 523(d)(5)(A) (“An individual’s
statement as to pain or other symptoms shall not alone be con-
clusive evidence of disability as defined in this section; there
must be medical signs and findings . . . which show the exis-
tence of a medical impairment . . . which could reasonably be
expected to produce the pain or other symptoms alleged and
which, when considered with all evidence . . . would lead to
a conclusion that the individual is under a disability.” (empha-
sis added)). The government notes that the general rule (sub-
ject to “rare” exceptions) “is to remand to the agency for
additional investigation or explanation.” INS v. Ventura, 

, 16 (2002) (per curiam). We do not credit-as-true in
only “rare” cases; according to the government, we took some
factfinding responsibility away from the Commissioner in at
least twenty-two cases during 2007 and 2008.

   The government finally notes that other circuits will
remand for determination of benefits only in narrow circum-
stances. See, e.g., Faucher v. Sec’y of Health & Human
Servs., 

, 176 (7th Cir. 1994) (“If a court deter-
mines that substantial evidence does not support the Secre-
tary’s decision, the court can reverse the decision and
immediately award benefits only if all essential factual issues
have been resolved and the record adequately establishes a
plaintiff ’s entitlement to benefits.”); see also Miller v.
Chater, 

(10th Cir. 1996) (remanding for a fifth
administrative hearing, but warning that “the Secretary is not
entitled to adjudicate a case ad infinitum until [he] correctly
applies the proper legal standard and gathers evidence to sup-
port [his] conclusion” (internal quotation marks omitted)). If,
as the government argues, crediting-as-true is a de facto find-
ing of disability, then our circuit’s precedent is badly mis-
aligned with that of other circuits.

   Of course, because the crediting-as-true rule is part of our
circuit’s law, only an en banc court can change it. Although
no judge has chosen to call for en banc rehearing in this case,
I am hopeful that the en banc court will consider the argument
                      VASQUEZ v. ASTRUE                    8427
when it is presented more directly in another case (e.g., one
where there is an explicit remand for immediate payment of
benefits based on the rule). Because the crediting-as-true rule
applies in every case where a court finds no substantial evi-
dence to support the Commissioner’s decision, the issue is of
exceptional importance. This is particularly so because the
“Social Security hearing system is probably the largest adjudi-
cative agency in the western world.” Heckler v. Campbell,

, 461 (1983) (noting that 2.3 million claims for
disability benefits were filed in 1981).

                               I

   When a panel is faced with an irreconcilable conflict in the
law of the circuit, it is required to make a sua sponte call for
en banc review. In Atonio v. Wards Cove Packing Co., Inc.,
the en banc court held that the three-judge panel facing con-
flicting circuit precedent erred in relying on one line of the
court’s authority on the basis that “it expressed the ‘correct
view’ or, alternatively, because it was the decision ‘first in
line.’ ” 

, 1478 (9th Cir. 1987) (en banc). Rather,
the court stated that “the appropriate mechanism for resolving
an irreconcilable conflict is an en banc decision. A panel
faced with such a conflict must call for en banc review.” 

(emphases added). The en banc court later
affirmed this holding in United States v. Hardesty, 

, 1348 (9th Cir. 1992) (en banc) (per curiam). In
Hardesty, the court specifically rejected the view that “where
there are two opposing lines of authority, a panel may, with-
out calling for en banc review, follow the rule which has ‘suc-
cessfully posed as the law of the circuit for long enough to be
relied on.’ 

(overruling Greenhow v. Sec.
of Health & Human Servs., 

, 636 (9th Cir.
1988)).
8428                      VASQUEZ v. ASTRUE
                                    II

                                    A

   The crediting-as-true rule creates an irrebutable presump-
tion that testimony before an administrative law judge and
rejected by him for no adequate reason is true. “[I]f the Secre-
tary fails to articulate reasons for refusing to credit . . . testi-
mony, then the Secretary, as a matter of law, has accepted that
testimony as true.” Varney v. Sec. of Health and Human
Servs. (Varney II), 

, 1398 (9th Cir. 1988) (quot-
ing Hale v. Bowen, 

, 1012 (11th Cir. 1987)).
The crediting-as-true rule is related to the decision on whether
to remand for award of benefits; however, they are separate
inquires.1

    The court is correct to point out that the crediting-as-true
rule was initially limited to cases “where there are no out-
standing issues that must be resolved before a proper disabil-
ity determination can be made, and where it is clear from the
administrative record that the ALJ would be required to award
benefits if the claimant’s excess pain testimony were credited
. . . .” 

However, the court in Hammock v. Bowen,

(9th Cir. 1989), extended the Varney II rule,
holding it applicable where “the delay experienced by [claim-
ant] has been severe and because of [her] advanced age.”2 

.
  1
     See Lester v. Chater, 

, 834 (9th Cir. 1995) (inquiries are
“similar[ ]”); Harman v. Apfel, 

, 1178-80 (9th Cir. 2000)
(applying the crediting-as-true rule but remanding for further consider-
ation rather than immediately awarding benefits); Benecke v. Barnhart,

, 594 (9th Cir. 2004) (applying the crediting-as-true rule and
only then discussing whether there were “outstanding issues that must be
resolved before a determination of disability [could] be made . . . .”).
   2
     The Hammock claimant was fifty-seven at the time of her hearing, and
the period between the ALJ hearing and the ruling by the court was about
three years. Unfortunately, it is not uncommon for three years to transpire
between an ALJ decision and a decision by this court. This is as true of
                           VASQUEZ v. ASTRUE                            8429
                                     B

   Later decisions extend the crediting-as-true rule to all
cases. As stated by the court in Lester v. Chater, 

,
(9th Cir. 1995), “[w]here the Commissioner fails to provide
adequate reasons for rejecting the opinion of a treating or
examining physician, we credit that opinion ‘as a matter of
law.’ ” 

Harman v. Apfel, 

, 1178 (9th
Cir. 2000) (same); Benecke v. Barnhart, 

(9th
Cir. 2007) (“Because the ALJ failed to provide legally suffi-
cient reasons for rejecting Benecke’s testimony and her treat-
ing physicians’ opinions, we credit the evidence as true.”).
The Lester, Harman, and Benecke courts did not require any
other conditions to be fulfilled before the court credited testi-
mony as true.3 Rather, the Harman and Benecke courts fol-

cases where the crediting-as-true is applied as it is of cases in which it is
not applied. See Nguyen v. Chater, 

(9th Cir. 1996) (seven-
year delay between first ALJ decision and Ninth Circuit decision; no
crediting-as-true); Byrnes v. Shalala, 

(9th Cir. 2005) (over
three years’ delay; no crediting-as-true); Connett v. Barnhart, 

(9th Cir. 2003) (four-year delay; no crediting-as-true) Also, it is com-
mon knowledge that disabilities disproportionately affect older individu-
als. Accordingly, the court’s attempt to dodge the split between the
mandatory and discretionary crediting-as-true rules based on age and
delay is unavailing. See slip op. at 8411-12. The court’s opinion identifies
the policy rationales behind the crediting-as-true rule, slip op. at 8411-12,
but fails to identify why those rationales apply to the case at bar more than
to cases in which the rule has not been applied.
   3
     In Harman, the court justifies the use of the crediting-as-true rule with
the policy rationales from Varney II. 

Such rationales —
that the crediting-as-true rule encourages ALJs to reach a correct decision
the first time, and that the rule minimizes the wait time for deserving
claimants — are present in every case the crediting-as-true rule touches.
The Harman court rejected the government’s attempt to distinguish Lester
on the basis that there actually was evidence to dispute the physician’s tes-
timony. 

Likewise, because the court remanded for further pro-
ceedings rather than for an award of benefits, Harman cannot be
distinguished away by limiting the crediting-as-true rule to cases where
remand for benefit calculation is appropriate. 

8430                      VASQUEZ v. ASTRUE
lowed the bright-line rule first set forth in Lester: that
testimony which was improperly rejected will be credited as
true as a matter of law.4

                                    C

   However, at least one other panel has explicitly held that
the crediting-as-true rule is not mandatory. Connett v. Barn-
hart, 

, 876 (9th Cir. 2003) (“[W]e are not con-
vinced that the ‘crediting as true’ doctrine is mandatory in the
Ninth Circuit.”) The Connett court identifies several cases in
which remands were made to allow the ALJ to make specific
credibility findings:

      In Dodrill, for example, our court specifically
      remanded for the ALJ to “articulat[e] specific find-
      ings for rejecting [the claimant’s] pain testimony and
      the testimony of lay witnesses.”. In Nguyen v.
      Chater, where the ALJ failed to consider the claim-
      ant’s testimony with regard to his asthma, our court
      remanded with the specific proviso that “[i]t is not
      our intent . . . to preclude the ALJ from reopening
      the hearing to receive additional evidence,” includ-
      ing, presumably, evidence regarding the claimant’s
  4
   The concurrence states that Harman is inapplicable because the court
held that the claimant was not eligible for her “evidence [to] be credited
and an immediate award of benefits directed” made under our test in
Smolen v. Charter, 

(9th Cir. 1996). 

(emphasis added). The dissent overlooks that the Harman court
acknowledges the Lester rule, in fact stating that the Smolen rule is “built
upon” it. 

the evidence before the ALJ, even if believed,
was not enough to direct payment of benefits. Instead, the case was
remanded for consideration of further evidence that was not before the
ALJ but was presented to the Appeals Council. On remand, “the ALJ
[might] then consider, the Commissioner then [might] seek to rebut and
the VE then [might] answer questions with respect to the additional evi-
dence.” 

Although admittedly the court could be clearer, it
never states that the ALJ may reconsider evidence already presented to the
ALJ — evidence which should be credited as true under Lester.
                          VASQUEZ v. ASTRUE                         8431
      credibility. See also Byrnes v. Shalala, 

,
      642 (9th Cir.1995) (“We therefore remand this case
      to the ALJ for further findings evaluating the credi-
      bility of [the claimant’s] subjective complaints
      . . . .”).

original).

The Connett court concluded that the court has “some flexi-
bility” in applying the crediting-as-true doctrine.5 

the cases cited by the Connett court address the crediting-as-
true doctrine, however. Furthermore, the court acknowledged
the existence of “seemingly compulsory language” in other
opinions of this court. 

court decided to
remand without crediting-as-true “[b]ecause there are insuffi-
cient findings as to whether Connett’s testimony should be
credited as true.” 

Connett court argued that “the propriety of remanding
for reconsideration of credibility determinations was implic-
itly approved by our court en banc in Bunnell v. Sullivan, 

, 348 (9th Cir.1991).” 

en banc court
never discussed the crediting-as-true rule. Thus, Bunnell is not
particularly helpful in defining the scope of the rule. Further-
more, the decisions in Lester, Harman, and Benecke all came
years after the Bunnell decision. While the Connett court’s
view that crediting-as-true is discretionary may draw support
from Bunnell, it is hardly compelled by the en banc court’s
reasoning. Accordingly, I do not believe that we can ignore
  5
    The Connett court does not provide guidance on how this “flexibility”
is to be employed, other than by explaining that there were “insufficient
findings” to justify invoking the crediting-as-true rule. Presumably this
does not mean that judges of this court are supposed to make factual find-
ings concerning technical medical matters and without the benefit of being
present at a hearing.
8432                   VASQUEZ v. ASTRUE
binding circuit precedent because of a case which merely sug-
gests that crediting-as-true is discretionary. Indeed, even if
Lester, Harman, and Benecke are inconsistent with Bunnell,
we lack the authority as a three-judge panel to overturn those
decisions.

                               III

    Until the court sitting en banc resolves this conflict and
clarifies how the crediting-as-true rule is to be applied in this
circuit, three-judge panels will have to continue to pick
among the competing lines of precedent, in violation of
Atonio and Hardesty. District court judges and administrative
law judges will be equally confused. Confusion is bad
enough; but when panels can choose which rules apply, there
is at least the perception that we do not dispense equal justice
under law. Litigants will be concerned — perhaps not without
cause — that sympathetic claimants will get the benefit of the
crediting-as-true rule, while less sympathetic claimants are
denied the benefit of the rule because the panel decides that
the rule is discretionary and should not apply. This court and
the district courts from which it hears appeals will be subject
to litigation that would be unnecessary if the en banc court
would clarify when the crediting-as-true rule applies. Of
course, any step that could reduce the amount of unnecessary
litigation in this Circuit would help speed up the process for
other litigants — a most worthy goal indeed.

   Because we lack authority to ignore either line of crediting-
as-true cases, I must respectfully dissent from the court’s
attempt to wade through the morass that our crediting-as-true
jurisprudence has become. I would stay the proceeding pend-
ing action by an en banc court.