Key Takeaways from Laird v. Bisignano

For practitioners litigating mental-health disability claims, the Fifth Circuit’s decision in Laird v. Bisignano, No. 25-50347 (5th Cir. Jan. 8, 2026), offers both guidance and caution. The case delves into the application of Listings 12.04 and 12.06, particularly under Paragraph C – marginal adjustment.

Overview of the Case

The claimant in Laird alleged disability based on bipolar disorder and anxiety, asserting that he met the criteria under Paragraph C of the relevant mental health listings. The Administrative Law Judge (ALJ) denied the claim, providing a brief Paragraph C discussion.

On appeal, the claimant argued that the ALJ’s explanation was conclusory and legally insufficient. The Fifth Circuit partially agreed but ultimately upheld the ALJ’s decision.

Key Legal Principles Affirmed by the Fifth Circuit

The Fifth Circuit reaffirmed two critical points that are shaping step-three disability litigation:

• Procedural deficiencies alone are not enough: Even if an ALJ’s listing analysis is flawed, claimants must still prove they were harmed by it.

• Substantive findings in other parts of the ALJ’s decision can compensate: Courts may connect the dots using the ALJ’s broader findings outside of Paragraph C.

  
  

What Supported the ALJ’s Denial

Although the ALJ’s Paragraph C reasoning was minimal, the court found that other findings filled the gap. These included:

• Independent performance of daily activities

• Positive response to medication

• Generally stable mental condition

• Lack of inpatient or emergency psychiatric care

  
  

These points, found in the ALJ’s Paragraph B findings and Residual Functional Capacity (RFC) analysis, weakened the argument that the claimant had marginal adjustment.

Q: How did Audler v. Astrue factor into the argument?

A: The claimant relied on Audler, which held that a conclusory ALJ analysis could warrant reversal. However, the Fifth Circuit distinguished Audler on the grounds that the evidence in Audler was uncontroverted and clearly supported the listing, whereas in Laird, the evidence supported the ALJ’s denial, including State Agency psychologist opinions.

Q: What should advocates know about arguing Paragraph C?

A: If you're challenging a Paragraph C finding, don’t rely solely on poor drafting. You must:

• Highlight record evidence of:

  • Psychiatric fragility

  • Hospitalizations

  • Repeated episodes of decompensation

  • Inability to function without structured support

• Explain why the ALJ’s other findings fail to rebut Paragraph C criteria.

  
  

Practice Tip: Form vs. Substance

While form matters, Laird underscores that in the Fifth Circuit, substance rules the day. A well-structured but factually unsupported Paragraph C argument is unlikely to prevail.

Got any questions? Schedule a consultation with us. I’m here to help. It’s a lot to take in, but we’ll get through it together. After all, navigating these waters is always easier when you’ve got someone to chat with.