Ok, the same thing literally just happened to me. LITERALLY!!! I got my letter 10 days ago. The judge denied me, my lawyer challenged, because we didn't agree with many of the reasons he gave for the denial. He seemed to pick and choose and even take things from one doctor and things from another doctor to make contradictory statements. My lawyer also failed to get some paperwork in on time and she thought could get it submitted , because the due date for paper work was new and felt since it was so new they may have given her a "pass". The challenge went to a 3 panel judge and they would decide if it would even get reviewed to go in front of the judge again. They refused to even review it. I received a letter from my lawyer saying I could challenge in federal court or reapply, but that she would not (in all caps) be able to represent me in federal court, as she had exhausted all options. WTF? I feel like going to federal court would be a mistake, I would have to hire a new lawyer and God only knows how long it would take to get a court date. I'm a little wiser now, so I feel like if I reapply it may be a little "easier " (for lack of a better word).
Good luck in whatever you chose to do. I hope it works out!!