MEMORANDUM OPINION AND ORDER

GAIL J. STANDISH, Magistrate Judge.

I. PROCEDURAL HISTORY

Plaintiff Daniel G. ("Plaintiff") filed a complaint seeking review of the decision of the Commissioner of Social Security denying his applications for Disability Insurance Benefits ("DIB") and Supplemental Security Income ("SSI"). [Dkt. 1.] The parties filed consents to proceed before the undersigned United States Magistrate Judge [Dkts. 11 & 12] and briefs addressing disputed issues in the case [Dkt. 22 ("Pl.'s Br."), Dkt. 23 ("Def.'s Br.") & Dkt. 24 ("Pl. Rep.")]. The Court has taken the parties' briefing under submission without oral argument. For the reasons discussed below, the Court finds that this matter should be remanded.

II. ADMINISTRATIVE DECISION UNDER REVIEW

In April 2014, Plaintiff filed applications for DIB and SSI. [Dkt. 17, Administrative Record ("AR") 15, 286-92, 295-96.] Plaintiff alleged disability commencing on January 6, 2016.3 [AR 15, 37-38.] Plaintiff's claims for benefits were denied initially and upon reconsideration. [AR 155-59, 165-69.] A hearing was held before Administrative Law Judge Joseph P. Lisiecki III ("the ALJ") on September 24, 2017. [AR 36-74.]

On October 4, 2017, the ALJ issued an unfavorable decision applying the five-step sequential evaluation process for assessing disability. [AR 15-26]; see 20 C.F.R. §§ 404.1520(b)-(g)(1), 416.920(b)-(g)(1). At step one, the ALJ concluded that Plaintiff had not engaged in substantial gainful activity since the alleged onset date of January 6, 2016. [AR 18.] At step two, the ALJ found that Plaintiff has the following severe impairments: bipolar disorder; status-post right hand partial amputation of the second and fifth digits; bilateral knee osteoarthritis; cervical and lumbar degenerative disc disease; obesity; sleep apnea; and a history of deep vein thrombosis. [Id.] At step three, the ALJ determined that Plaintiff did not have an impairment or combination of impairments that meets or medically equals the severity of one of the listed impairments. [Id.]; see 20 C.F.R. part 404, subpart P, appendix 1. Next, the ALJ found that Plaintiff had the residual functional capacity ("RFC") for a range of medium work and was able to: lift and carry 50 pounds occasionally and 25 pounds frequently; stand and walk 6 hours in an 8-hour workday; sit for 6 hours in an 8-hour workday; perform postural activities frequently; handle, finger, feel, and reach overhead and all other directions with the right dominant upper extremity frequently; operate foot controls bilaterally frequently; and interact with coworkers, supervisors, and the general public occasionally. [AR 20 (citing 20 C.F.R. §§ 404.1567(c), 416.967(c)).] The ALJ further found that Plaintiff was limited to performing simple and object-oriented tasks and was precluded from climbing ladders, ropes, and scaffolds and performing work involving dangerous moving machinery, unprotected heights, humidity, wetness, dusts, odors, fumes, pulmonary irritants, and extremes in cold or heat. [AR 20.] At step four, the ALJ found that Plaintiff was not able to perform his past relevant work as a tile setter. [AR 24.] At step five, the ALJ found that Plaintiff was capable of performing other work that exists in significant numbers in the economy, including the representative occupations of laundry worker, food service worker, and warehouse worker. [AR 25.]

The Appeals Council denied review of the ALJ's decision on August 30, 2018. [AR 1-3.] This action followed.

Plaintiff raises the following arguments: 1) the ALJ failed to properly consider medical opinion evidence in assessing Plaintiff's mental and physical impairments; 2) the ALJ failed to cite sufficient reasons for rejecting Plaintiff's subjective symptom testimony; 3) the ALJ failed to properly consider third-party testimony; and 4) the ALJ's finding that Plaintiff could perform other work was not supported by substantial evidence. [Pl. Br. at 3-16; Pl. Rep. at 1-5.] Plaintiff requests reversal and remand for payment of benefits or, in the alternative, remand for further administrative proceedings. [Pl. Br. at 17.] The Commissioner asserts that the ALJ's decision should be affirmed. [Def. Br. at 3-17.]

III. GOVERNING STANDARD

Under 42 U.S.C. § 405(g), the Court reviews the Commissioner's decision to determine if: (1) the Commissioner's findings are supported by substantial evidence; and (2) the Commissioner used correct legal standards. See Carmickle v. Comm'r Soc. Sec. Admin., 533 F.3d 1155, 1159 (9th Cir. 2008); Brewes v. Comm'r Soc. Sec. Admin., 682 F.3d 1157, 1161 (9th Cir. 2012) (internal citation omitted). "Substantial evidence is more than a mere scintilla but less than a preponderance; it is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Gutierrez v. Comm'r of Soc. Sec., 740 F.3d 519, 522-23 (9th Cir. 2014) (internal citations omitted).

The Court will uphold the Commissioner's decision when the evidence is susceptible to more than one rational interpretation. Molina v. Astrue, 674 F.3d 1104, 1110 (9th Cir. 2012). However, the Court may review only the reasons stated by the ALJ in his decision "and may not affirm the ALJ on a ground upon which he did not rely." Orn v. Astrue, 495 F.3d 625, 630 (9th Cir. 2007). The Court will not reverse the Commissioner's decision if it is based on harmless error, which exists if the error is "inconsequential to the ultimate nondisability determination, or if despite the legal error, the agency's path may reasonably be discerned." Brown-Hunter v. Colvin, 806 F.3d 487, 492 (9th Cir. 2015) (internal quotation marks and citations omitted).

IV. DISCUSSION

A. Medical Opinion Evidence

Plaintiff contends the ALJ erred by failing to properly consider the medical opinion evidence, including the opinion of his treating psychiatrist Dau Nguyen, M.D. [Pl. Brief at 3-8; Pl. Rep. at 1-3.] The Court agrees.

"There are three types of medical opinions in social security cases: those from treating physicians, examining physicians, and non-examining physicians." Valentine v. Comm'r Soc. Sec. Admin., 574 F.3d 685, 692 (9th Cir. 2009); Lester v. Chater, 81 F.3d 821, 830 (9th Cir. 1995). In general, a treating physician's opinion is entitled to more weight than an examining physician's opinion and an examining physician's opinion is entitled to more weight than a nonexamining physician's opinion.4 See Lester, 81 F.3d at 830. "The medical opinion of a claimant's treating physician is given controlling weight so long as it is well-supported by medically acceptable clinical and laboratory diagnostic techniques and is not inconsistent with the other substantial evidence in [the] case record." Trevizo v. Berryhill, 871 F.3d 664, 675 (9th Cir. 2017) (internal quotation marks and citation omitted).

An ALJ must provide "clear and convincing" reasons supported by substantial evidence to reject the uncontradicted opinion of a treating or examining physician. Bayliss v. Barnhart, 427 F.3d 1211, 1216 (9th Cir. 2005) (citing Lester, 81 F.3d at 830-31). Where such an opinion is contradicted, however, an ALJ may reject it only by stating "specific and legitimate" reasons supported by substantial evidence. Bayliss, 427 F.3d at 1216 (citing Lester, 81 F.3d at 830-31); Trevizo, 871 F.3d at 675. The ALJ can satisfy this standard by "`setting out a detailed and thorough summary of the facts and conflicting clinical evidence, stating his interpretation thereof, and making findings.'" Garrison v. Colvin, 759 F.3d 995, 1012 (9th Cir. 2014) (quoting Reddick v. Chater, 157 F.3d 715, 725 (9th Cir. 1998)); see also 20 C.F.R. §§ 404.1527(c)(2)-(6) (when a treating physician's opinion is not given controlling weight, factors such as the nature, extent, and length of the treatment relationship, the frequency of examinations, the specialization of the physician, and whether the physician's opinion is supported by and consistent with the record should be considered in determining the weight to give the opinion), 416.927(c)(2)-(6) (same).

Plaintiff began receiving treatment at the San Bernardino Department of Behavioral Health in May 2016. [AR 1085.] Dr. Nguyen was one of Plaintiff's physicians. [AR 1062-67.] Dr. Nguyen's records reflect that Plaintiff often had a depressed and anxious mood with a constricted affect and sometimes complained of sleep issues. [AR 1062-67.] In September 2017, Dr. Nguyen completed a mental impairment questionnaire.5 [AR 1115-19.] He diagnosed Plaintiff with bipolar disorder, unspecified and stated that Plaintiff suffers from "episodic flare ups of severe depression." [AR 1115.] Dr. Nguyen cited numerous clinical findings to demonstrate the severity of Plaintiff's mental impairment and symptoms, including poor memory, somatic complaints, sleep disturbance, severe depressed mood, poor ability to complete activities of daily living, anxiety, daily crying spells, episodic flare ups, social isolation, poor ability to sustain concentration to complete tasks or organize a plan to complete tasks, and lack of energy. [AR 1115.] Dr. Nguyen also noted that Plaintiff's psychiatric condition exacerbated Plaintiff's pain and physical symptoms, which included knee pain, sleep apnea, hypertension, deep vein thrombosis (legs), pain with movement, and obesity. [AR 1117.] Dr. Nguyen opined that Plaintiff had "moderate" limitations in the ability to understand, remember or apply information, "marked" limitations in the ability to interact with others, "marked" limitations in the ability to concentrate, persist, or maintain pace, and "extreme" limitations in the ability to adapt or manage himself. [AR 1117.] Dr. Nguyen further found that Plaintiff had a "[m]edically documented history of a chronic organic mental ... or affective disorder of at least 2 years' duration with evidence of both: [m]edical treatment [or] mental health therapy ... that diminishes the symptoms and signs of the mental disorder; and [m]arginal adjustment, that is, ... minimal capacity to adapt to changes in [ ] one's environment or to demands that are not already part of one's daily life." [AR 1118.] Dr. Nguyen concluded that Plaintiff's impairments or treatment would cause him to be absent from work "more than four days per month" due to "episodic flare ups of severe depression and/or mood lability . . . lasting 3 days to several weeks." [AR 1118.]

The ALJ gave "little weight" to Dr. Nguyen's opinion. [AR 23.] The ALJ found that "the level of impairment alleged [was] not consistent with the other objective medical evidence of record," as it "[did] not match the claimant's presentation to the other treating sources." [AR 23.] The ALJ also stated that Dr. Nguyen's assessment was inconsistent with Plaintiff's "presentation" to his regular treating physician, Dr. Gilbert Zini, which demonstrated that he was "doing well psychiatrically and that the treatment [was] effective in controlling his symptoms." [AR 23, 1020-22, 1025-26.] The ALJ failed to state legitimate reasons for rejecting Dr. Nguyen's opinion.

First, the ALJ's broad and conclusory statements that Dr. Nguyen's findings were "not consistent with the other objective medical evidence of record" and did not "match" Plaintiff's "presentation to the other treating sources" were not specific and legitimate reason for discounting Dr. Nguyen's opinion. See Embrey v. Bowen, 849 F.2d 418, 421-22 (9th Cir. 1988) ("To say that medical opinions are not supported by sufficient objective findings or are contrary to the preponderant conclusions mandated by the objective findings does not achieve the level of specificity our prior cases have required . . . The ALJ must do more than offer his conclusions. He must set forth his own interpretations and explain why they, rather than the doctors', are correct."); Rodriguez v. Bowen, 876 F.2d 759, 762 (9th Cir. 1989) (same).

Second, the ALJ's assertion that Dr. Nguyen's opinion was inconsistent with Dr. Zini's alleged findings that Plaintiff's symptoms were controlled with treatment merely stated a conflict in the medical evidence, which triggered, rather than satisfied, the ALJ's obligation of stating specific, legitimate reasons for rejecting Dr. Nguyen's treating opinion. See Bayliss, 427 F.3d at 1216; Trevizo, 871 F.3d at 675; Wood v. Colvin, No. EDCV 16-534-E, 2016 WL 5496267, at *2 (C.D. Cal. Sept. 28, 2016). Moreover, a review of Dr. Zini's records shows that despite describing Plaintiff as "doing well" on two occasions, Dr. Zini also reported that Plaintiff experiences depression, anxiety, and chronic fatigue. [AR 1021, 1025, 1109, 1111-12.] It was improper for the ALJ to rely on isolated signs of alleged improvement in Dr. Zini's records to discredit Dr. Nguyen's opinion. See, e.g., Garrison, 759 F.3d at 1017 (reasoning that the ALJ cannot rely on isolated evidence of improvement when the record as a whole shows continuing cycles of debilitating and less severe symptoms); Attmore v. Colvin, 827 F.3d 872, 878 (9th Cir. 2016) ("[i]t is the nature of bipolar disorder that symptoms wax and wane over time."); Scott v. Astrue, 647 F.3d 734, 740 (7th Cir. 2011) ("The very nature of bipolar disorder is that people with the disease experience fluctuations in their symptoms, so any single notation that a patient is feeling better or has had a `good day' does not imply that the condition has been treated.").

Accordingly, the ALJ's reasons for rejecting Dr. Nguyen's opinion were not specific and legitimate or supported by substantial evidence in the record. Remand is warranted on this issue.

V. REMAND FOR FURTHER PROCEEDINGS

The Court has discretion to remand or reverse and award benefits. See Trevizo, 871 F.3d at 682. Where no useful purpose would be served by further proceedings and the record has been fully developed, it may be appropriate to exercise this discretion to direct an immediate award of benefits. See id. at 682-83. But where there are outstanding issues that must be resolved before a determination of disability can be made or it is not clear from the record that the ALJ would be required to find a claimant disabled if all the evidence were properly evaluated, remand is appropriate. See Garrison, 759 F.3d at 1021 (if "an evaluation of the record as a whole creates serious doubt that a claimant is, in fact, disabled," a court must remand for further proceedings).

In this case, there are outstanding issues that must be resolved before a final determination can be made. Because the ALJ failed to provide specific and legitimate reasons for discounting Dr. Nguyen's opinion, the record is not fully developed, Plaintiff's entitlement to benefits remains unclear, and remand for further administrative proceedings would be useful. See Garrison, 759 F.3d at 1020-21. On remand, the ALJ should conduct a review of the entire record in a manner that is consistent with the Court's findings.6

IT IS ORDERED.