                             UNPUBLISHED ORDER
                          Not to be cited per Circuit Rule 53




           United States Court of Appeals
                             For the Seventh Circuit
                             Chicago, Illinois 60604

                              Argued January 25, 2006
                              Decided March 30, 2006

                                        Before

                          Hon. RICHARD A. POSNER, Circuit Judge

                          Hon. DANIEL A. MANION, Circuit Judge

                          Hon. DIANE P. WOOD, Circuit Judge


No. 05-1813                                      Appeal from the United States
                                                 District Court for the Eastern
DONALD A. BOYD,                                  District of Wisconsin
             Plaintiff-Appellant,
                                                 No. 03 C 453
      v.
                                                 William C. Griesbach, Judge.
JO ANNE B. BARNHART,
Commissioner of Social Security,
                Defendant-Appellee.


                                      ORDER

      Donald Boyd sought attorney’s fees in this Social Security case under the
Equal Access to Justice Act (EAJA), 28 U.S.C. § 2412, after the district court
remanded the case to the Commissioner for reconsideration. The district court
denied Boyd’s request for fees, holding that the Commissioner’s prelitigation
conduct and litigation position were “substantially justified” despite the remand.
Boyd contends on appeal that the district court abused its discretion in refusing to
grant his fee request. We agree.
No. 05-1813                                                                     Page 2



                                  I. Background

      Boyd was injured when a mobile home that he was working on at his place of
employment apparently fell off the hoist and basically crushed his chest and ribs.
Miraculously he survived, and apparently recovered substantially. Nevertheless, he
applied for disability benefits in July 1999, claiming disability beginning in
September 1997 as a result of the injury. His application was denied on both initial
examination and on reconsideration, and he requested a hearing.

       At the hearing Boyd testified that he experienced persistent arm, shoulder
and back pain, blood flow problems in his right arm, coldness in his hands and feet,
an inability to support his upper body with his back, difficulty with routine
household tasks, and an inability to play basketball with his son. In his written
decision, the ALJ made no explicit determination of whether Boyd’s testimony
regarding his pain was credible. Instead the ALJ noted generally that “[w]hile
claimant may have some degree of pain and limitation it is not as severe or limiting
as claimant has alleged.” The ALJ denied Boyd’s application based almost entirely
on the objective medical evidence and the credibility of Boyd’s treating physician,
Dr. Siepmann. The Appeals Council denied Boyd’s request for review, and the
ALJ’s opinion became the Commissioner’s final decision.

        Boyd then filed a civil action in the district court under 42 U.S.C. § 405(g).
The district court reversed the Commissioner’s decision and remanded the case for
further consideration. The court concluded that the ALJ did not comply with SSR
96-7p when she discounted Boyd’s complaints of pain in a cursory manner without
going through the seven criteria in the regulation. The court reasoned that the
credibility determination was flawed because the ALJ (1) wrongly concluded that
Boyd’s reported activities of daily living necessarily contradicted his claim of
disabling pain; (2) failed to identify any other, permissible basis such as the
functional capacity evaluation, to justify rejecting Boyd’s testimony about his pain;
(3) failed to recognize evidence that Boyd’s treatment for pain had continued for at
least two years past the point at which the ALJ thought it had ended; and (4) failed
to fully consider the medications Boyd was taking for pain. Because the ALJ’s
failure to assess Boyd’s credibility in the manner required by SSR 96-7p was
enough to require a remand, the court did not reach Boyd’s second argument:
whether proper weight was given to Dr. Siepmann’s testimony under SSR 96-2p.

       Boyd then filed a petition under the EAJA to recover the $7,435 in attorney’s
fees associated with his appeal of the ALJ’s decision. The district court denied the
petition. The court reasoned that the underlying appeal had been “close,” and thus,
despite the remand, the Commissioner’s prelitigation conduct and litigation position
No. 05-1813                                                                                 Page 3



were “substantially justified.” The court noted that “this was not a case in which
the ALJ failed to discuss the credibility of the claimant at all,” or ignored every
factor set forth in SSR 96-7p. The court also concluded that the ALJ’s failure to
account for all of Boyd’s medications was partly Boyd’s fault in not fully explaining
his medication regimen when offered the opportunity to do so.1

                                          II. Analysis

        We review the denial of attorney’s fees under the EAJA for abuse of
discretion. Pierce v. Underwood, 487 U.S. 552, 559 (1988); Conrad v. Barnhart, 434
F.3d 987, 990 (7th Cir. 2006). Boyd is entitled to recover his attorney’s fees
provided that: (1) he was a “prevailing party”; (2) the Commissioner’s position was
not “substantially justified”; (3) there exist no “special circumstances” that would
make an award unjust; and (4) he filed a timely and complete application with the
district court. 28 U.S.C. § 2412(d)(1)(A); Conrad, 434 F.3d at 989. The
Commissioner does not dispute that Boyd meets all of the prongs except the second.
The Commissioner bears the burden of proving that her position was substantially
justified. Conrad, 434 F.3d at 990.

       EAJA fees may be awarded if either the Commissioner’s prelitigation conduct
or her litigation position were not substantially justified. Cunningham v. Barnhart,
No. 05-1981, 2006 WL 538252, at *1 (7th Cir. Mar. 7, 2006). The ALJ’s decision,
because it is part of the action that gave rise to the litigation in district court,
constitutes part of the Commissioner’s prelitigation conduct. Id. In order for the
Commissioner’s position to be substantially justified, it must have reasonable
factual and legal bases, and there must exist a reasonable connection between the
facts and her legal theory. See Pierce, 487 U.S. at 565; Conrad, 434 F.3d at 990.
The outcome of a case is not conclusive evidence of the justification for the
government’s position. Bricks, Inc. v. EPA, 426 F.3d 918, 922 (7th Cir. 2004).

       After examining the Commissioner’s conduct as a whole, we have determined
that in this case she was not substantially justified. The ALJ issued a decision that
did not comport with the Commissioner’s own rulings. SSR 96-7p requires that,
“once an underlying physical or mental impairment(s) that could reasonably be
expected to produce the individual’s pain or other symptoms has been shown,” the
ALJ “must make a specific finding on the credibility of the individual’s statements


       1
          At this time we do not know the status of Boyd’s hearing on remand. In determining
that the award of attorney’s fees is appropriate at this juncture, we do not reach any conclusion
on the merits of Boyd’s petition.
No. 05-1813                                                                      Page 4



based on a consideration of the entire case record.” SSR 96-7p, 1996 WL 374186 at
*2 (S.S.A. July 2, 1996). In addition to the objective medical evidence, the ALJ
must then consider seven criteria:

              1. The individual’s daily activities;

            2. The location, duration, frequency, and intensity of the individual’s
      pain or other symptoms;

              3. Factors that precipitate and aggravate the symptoms;

             4. The type, dosage, effectiveness, and side effects of any medications
      the individual takes or has taken to alleviate pain or other symptoms;

             5. Treatment, other than medication, the individual receives or has
      received for relief of pain or other symptoms;

              6. Any measures other than treatment the individual uses or has used
      to relieve pain or other symptoms (e.g., lying flat on his or her back, standing
      for 15 to 20 minutes ever hour, or sleeping on a board); and

            7. Any other factors concerning the individual’s functional limitations
      and restrictions due to pain or other symptoms.

Id.; see generally Golembiewski v. Barnhart, 322 F.3d 912, 915-16 (7th Cir. 2003).
The ALJ’s credibility determination must be sufficiently specific to enable
meaningful appellate review, Brindisi ex rel. Brindisi v. Barnhart, 315 F.3d 783,
787-88 (7th Cir. 2003); SSR 96-7p at *3, and the reasons for the ALJ’s credibility
finding must be specified, not implied, Golembiewski I, 322 F.3d at 916.

       The extent of Boyd’s pain and whether it was disabling was the entire issue
in Boyd’s claim for disability payments. Because the ALJ found that Boyd had
suffered serious injuries in the 1997 accident that could have caused pain, he was
under a duty to evaluate the credibility of Boyd’s testimony as to that pain using all
the factors listed in SSR 96-7p. See SSR 96-7p at *3; Carradine v. Barnhart, 360
F.3d 751, 753 (7th Cir. 2004); Clifford v. Apfel, 227 F.3d 863, 871-72 (7th Cir. 2000).
In order to discredit Boyd’s testimony regarding his pain, the ALJ was required to
articulate specific reasons for doing so that were supported by the record. Schmidt
v. Barnhart, 395 F.3d 737, 746-47 (7th Cir. 2005); Skarbek v. Barnhart, 390 F.3d
500, 505 (7th Cir. 2004). That did not happen here.
No. 05-1813                                                                    Page 5



       More significantly, however, the Commissioner subsequently compounded
the prelitigation error by defending the ALJ’s decision in the district court without
confronting the basic deficiency in the ALJ’s credibility finding. The Commissioner,
in her submission to the district court, instead ignored SSR 96-7p entirely and
defended the ALJ’s decision by relying on the objective medical evidence, the
testimony of the vocational expert, and a brief discussion of Boyd’s daily living
activities. The position of the Commissioner at the litigation stage was that the
record in total provides substantial evidence to support the ALJ’s decision. But as
this court said in Golembiewski–which Boyd prominently cited in his filing in the
district court along with SSR 96-7p–the agency rule does not permit a credibility
finding to be “implied” from the record. See Golembiewski, 322 F.3d at 916 (“[T]he
cases make clear that the ALJ must specify the reasons for his finding so that the
applicant and subsequent reviewers will have a fair sense of the weight given to the
applicant’s testimony.” (emphasis in original)); Brindisi, 315 F.3d at 788 (holding
that implied credibility determination does not allow for appropriate appellate
review). The ALJ’s decision does not provide an explicit credibility determination,
and it was unreasonable for the Commissioner to defend that decision without so
much as acknowledging Boyd’s argument about SSR 96-7p.

       Because the ALJ’s decision, and therefore the Commissioner’s prelitigation
conduct, did not adhere to our precedent and the Commissioner’s own regulations
by failing to explicitly discuss Boyd’s credibility, and because the Commissioner
went on to defend the ALJ’s decision in district court even though it lacked a
reasonable basis in law for that defense, the Commissioner’s position was not
substantially justified. It would have been better for the Commissioner to have
acknowledged the ALJ’s deficient decision and sent the case back to the ALJ to
make a credibility determination rather than to prolong the case.

        Boyd also argues on appeal that the district court abused its discretion
because the ALJ committed legal error in his assessment of the treating physician’s
opinion by not according it controlling weight. However, as the Commissioner
points out, the district court did not reach the merits of the issue of the ALJ’s
evaluation of Dr. Siepmann’s testimony. Additionally, Boyd did not argue in the
district court that the ALJ’s assessment of Dr. Siepmann’s testimony was a basis
for concluding that the Commissioner’s prelitigation position was not substantially
justified. Therefore, because the district court did not have an opportunity to rule
on this issue in the context of the EAJA petition, the matter is not properly before
us. See McGoffney v. Vigo County Div. of Family and Children, Family and Soc.
Serv. Admin., 389 F.3d 750, 753 (7th Cir. 2004) (explaining that parties may only
raise on appeal issues that have been presented to district court); Williams v. REP
No. 05-1813                                                                   Page 6



Corp., 302 F.3d 660, 666 (7th Cir. 2002) (“A party waives any argument that it does
not raise before the district court.”)

                                 III. Conclusion

      For the foregoing reasons, we REVERSE the order the district court and
REMAND to the district court with instructions to grant Boyd’s petition for
attorney’s fees.
