                            NOT FOR PUBLICATION

                    UNITED STATES COURT OF APPEALS                             FILED
                            FOR THE NINTH CIRCUIT                              MAY 02 2014

                                                                           MOLLY C. DWYER, CLERK
                                                                             U.S. COURT OF APPEALS

SHIRLEY K. KLAHN,                                No. 12-16140

              Plaintiff - Appellant,             D.C. No. 3:10-cv-08201-MHB

  v.
                                                 MEMORANDUM*
CAROLYN W. COLVIN, Commissioner
of Social Security,

              Defendant - Appellee.


                   Appeal from the United States District Court
                            for the District of Arizona
                  Michelle H. Burns, Magistrate Judge, Presiding

                       Argued and Submitted April 11, 2014
                            San Francisco, California

Before: KLEINFELD, NGUYEN, and WATFORD, Circuit Judges.

       We need not resolve at this time Appellant Shirley Klahn’s arguments

challenging the administrative law judge’s (ALJ) rulings finding her not fully

credible and rejecting her doctors’ opinions about the extent of her disability.

Even if Klahn’s arguments on those issues fail, it appears she may nonetheless be


        *
             This disposition is not appropriate for publication and is not precedent
except as provided by 9th Cir. R. 36-3.
                                                                          Page 2 of 2
entitled to benefits under our holding in Lounsburry v. Barnhart, 468 F.3d 1111

(9th Cir. 2006). The ALJ has not yet addressed Lounsburry’s impact on this case,

so we remand to the ALJ for further consideration of Klahn’s claim in light of

Lounsburry.

      The Commissioner contends that Klahn waived any argument based on

Lounsburry by not raising it until she submitted a Rule 28(j) letter shortly before

oral argument. We may consider an argument not presented in the opening brief if

“the failure to raise the issue properly did not prejudice the defense of the opposing

party.” United States v. Ullah, 976 F.2d 509, 514 (9th Cir. 1992). The

Commissioner points to no prejudice caused by Lounsburry’s late appearance,

which is not surprising. The Commissioner was aware of Lounsburry, having cited

the case in her own brief. If the Commissioner believes there are grounds for

denying Klahn benefits even under the rule established in Lounsburry, she will

have a full opportunity to raise those arguments before the ALJ on remand.

      The parties shall bear their own costs on appeal.

      VACATED AND REMANDED.
                                                                             FILED
Klahn v. Colvin, 12-16140                                                    MAY 02 2014

                                                                          MOLLY C. DWYER, CLERK
                                                                           U.S. COURT OF APPEALS

KLEINFELD, Senior Circuit Judge, dissenting:


      I respectfully dissent. Substantial evidence supports the ALJ’s findings as to

Klahn’s credibility and the limited weight given to Klahn’s treating and examining

physicians. See Flaten v. Sec’y of Health & Human Servs., 44 F.3d 1453, 1457

(9th Cir. 1995).

      Klahn’s argument under Lounsburry v. Barnhart, 468 F.3d 1111 (9th Cir.

2006) ought to be treated as waived because she did not raise it in her opening

brief. Klahn first made this argument in a Rule 28(j) letter citing Lounsburry, but

that case was decided six years before she submitted her brief on the merits. Klahn

has offered no excuse for making an entirely new argument after briefing. See

United States v. Gomez-Mendez, 486 F.3d 599, 606 n.10 (9th Cir. 2007).
