No. 93-1783 In the Supreme Court of the United States OCTOBER TERM, 1994 DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, PETITIONER v. NEWPORT NEWS SHIPBUILDING AND DRY DOCK COMPANY, ET AL. ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT REPLY BRIEF FOR THE PETITIONER THOMAS S. WILLIAMSON, Jr. Solicitor of Labor Department of Labor Washington D.C. 20210 DREW S. DAYS, III Solicitor General Department of Justice Washington, D.C. 20530 (202)514-2217 ---------------------------------------- Page Break ---------------------------------------- TABLE OF AUTHORITIES Cases: Page Albemarle Paper Co. V. Moody, 422 U.S. 405 ( 1975) . . . . 2 Carozza v. United States Steel Corp., 727 F.2d 14 (3d Cir. 1984) . . . . 10 Director, OWCP v. Cargill, Inc., 718 F.2d 886 (9th Cir. 1983) . . . . 17 Director, OWCP v. Eastern Coal Corp., 561 F.2d 632 (6th Cir. 1977) . . . . 10 Director, OWCP V. General Dynamics Corp., 982 F.2d 790 (2d Cir. 1992) . . . . 17 Director, OWCP v. Greenwich Collieries, 114 s. ct. 2251 (1994) . . . . 17, 18 Director, OWCP v. National Van Lines, Inc., 613 F.2d 972 (D.C. Cir. 1979), cert. denied, 448 U.S. 907 (1980) . . . . 17 Director, OWCP v. Newport News Shipbuilding & Dry Dock Co., 676 F.2d 110 (4th Cir. 1982) . . . . 17 Director, OWCP V. Rochester & Pittsburgh Coal Co., 678 F.2d 17 (3d Cir. 1982) . . . . 15 Far East Conference v. United States, 342 U.S. 570 (1952) . . . . 16 General Tel. Co. V. EEOC, 446 U.S. 318 (1980) . . . . 5 Gibas v. Saginaw Mining Co., 748 F.2d 1112 (6th Cir. 1984), cert. denied, 471 U.S. 1116 (1985) . . . . 10 INS V. Chadha, 462 U.S. 919 (1983) . . . . 12 Ingalls Shipbuilding Div. V. White, 681 F.2d 275 (5th Cir. 1982) . . . . 12 International Primate Protection League V. Ad- ministrators of Tulane Educ. Fund, 500 U.S. 72 (1991) . . . . 16 Kalaris V. Donovan, 697 F.2d 376 (D.C. Cir.), cert. denied, 462 U.S. 1119 (1983) . . . . 9-10 McCord v. Benefits Review Bd., 514 F.2d 198 (D.C. Cir. 1975) . . . . 7 Maine V. Taylor, 477 U.S. 131 (1986) . . . . 12 Martin V. OSHRC, 499 U.S. 144 (1991) . . . . 11 Monell V. Department of Social Serv., 436 U.S. 658 (1978) . . . . 16 (I) ---------------------------------------- Page Break ---------------------------------------- II Cases Continued: Page NLRB V. E.D.P. Medical Computer Sys., Inc., 6 F.3d 951 (2d Cir. 1993) . . . . 4 Nacirema Operating Co. v. Benefits Review Bd., 538 F.2d 73 (3d Cir. 1976) . . . . 7 Nathanson v. NLRB, 344 U.S. 25 (1952) . . . . 4 Nevada V. United States, 463 U.S. 110 (1983) . . . . 7 Newpark Shipbuilding & Repair, Inc. V. Roundtree, 723 F.2d 399 (5th Cir.), cert. denied, 469 U.S. 818 (1984) . . . . 12 Ohio V. Helvering, 292 U.S. 360 (1934) . . . . 16 Oil, Chem. & Atomic Workers Int'1 Union V. OSHRC, 671 F.2d 643 (D.C. Cir.), cert. denied, 459 U.S. 905 (1982) . . . . 7 Perry, In re, 882 F.2d 534 (lst Cir. 1989) . . . . 11 Ryan-Walsh Stevedoring Co. V. Trainer, 601 F.2d 1306 (5th Cir. 1979) . . . . 10 Shepard V. NLRB, 459 U.S. 344 (1983) . . . . 3-4 United States v. Nixon, 418 U.S. 683 (1974) . . . . 12 Vaca V. Sipes, 386 U.S. 171 (1967) . . . . 4 Vermont Yankee Nuclear Power Corp. v. Natural Resources Defense Council, Inc., 435 U.S. 519 (1978) . . . . 13 Weiss V. United States, 114 S. Ct. 752 (1994) . . . . 10 Constitution, statutes, regulations and rule: U.S. Const. Art. III . . . . 2, 3, 4, 6, 12 Administrative Procedure Act, 5 U.S.C. 551 et seq.: 5 U.S.C. 551 (2) . . . . 17 5 U.S.C. 556 (C) (7(c)) . . . . 18 5 U.S.C. 701 (b) (2) . . . . 17 5 U.S.C. 702 . . . . 17 5 U.S.C. 703 . . . . 18 Black Lung Benefits Act, 30 U.S.C. 932 (k) . . . . 14, 15 Civil Rights Act of 1964, Tit. VII, 42 U.S.C. 2000e et seq . . . . . 2, 3 Employee Retirement Income Security Act, 29 U.S.C. 1001 et seq . . . . . 3 Fair Labor Standards Act of 1938, 29 U.S.C. 201 et seq . . . . . 3 ---------------------------------------- Page Break ---------------------------------------- III Statutes, regulations and rule-Continued: Page Longshore and Harbor Workers' Compensation Act, 33 U.S.C. 901 et seq. . . . . 1 33 U.S.C. 902 (1) . . . . 15 33 U.S.C. 902 (4) . . . . 16 33 U.S.C. 902 (6) . . . . 15 33 U.S.C. 906 . . . . 2 33 U.S.C. 907 (a) . . . . 5 33 U.S.C. 907 (b) . . . . 5 33 U.S.C. 908 . . . . 2 33 U.S.C. 908 (f) (8 (f)) . . . . 17 33 U.S.C. 908 (i) . . . . 3, 5, 11 33 U.S.C. 909 . . . . 2 33 U.S.C. 910 . . . . 2 33 U.S.C. 915 (b) . . . . 3 33 U.S.C. 916 . . . . 3 33 U.S.C. 919 (d) . . . . 17 33 U.S.C. 921 (b) (1) . . . . 9 33 U.S.C. 921 (b) (2) . . . . 9 33 U.S.C. 921 (b) (3) . . . . 10 33 U.S.C. 921 (b) (4) ( 21 (b) (4)) . . . . 13 33 U.S.C. 921 (c) (21 (c)) . . . . 6, 7,13, 15, 16, 17, 18 33 U.S.C. 921 (d) . . . . 3, 6 33 U.S.C. 921a ( 21a) . . . . 11, 13 33 U.S.C. 939 (a) . . . . 13 33 U.S.C. 939 (c) (1) . . . . 3, 5 33 U.S.C. 941 . . . . 6 33 U.S.C. 944 . . . . 6 29 U.S.C. 661 . . . . 10 42 U.S.C. 1983 . . . . 16 20 C.F.R.: Sections 725.410-725.422 . . . . 14 Section 725.522 . . . . 15 Section 801.104 . . . . 10 Sup. Ct. R. 12.3. . . . 17 Miscellaneous: H.R. Rep. No. 1441, 92d Cong., 2d Sess. (1972) . . . . 2, 9, 14 S. Rep. No. 1125, 92d Cong., 2d Sess. (1972) . . . . 9, 13 S. Rep. No. 209, 95th Cong., 1st Sess. (1977) . . . . 14 Sec. Order 38-72,38 Fed. Reg. 90 (1973) . . . . 10 ---------------------------------------- Page Break ---------------------------------------- In the Supreme Court of the United States OCTOBER TERM, 1994 No. 93-1783 DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, PETITIONER v. NEWPORT NEWS SHIPBUILDING AND DRY DOCK COMPANY, ET AL. ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT REPLY BRIEF FOR THE PETITIONER 1. Respondent's contention that the Director, Office of Workers' Compensation Programs, does not have standing to seek judicial review of an erroneous determination by the Benefits Review Board (Board ) of a claims award under the Longshore and Harbor Workers' Compensation Act, 33 U.S.C. 901 et seq. (LHWCA), is premised on a misconception of the matter as a purely private dispute. See Resp. Br. 6-7, 26, 28, 29. It also rests on the er- roneous assertion that because the Director is a "neutral" administrator, she cannot "advocate" for either a claimant or an employer without creating an impermissible conflict of interest. Id. at 19, 25-28. Congress created the federal compensation scheme of the LHWCA to further interests broader than merely those (1) ---------------------------------------- Page Break ---------------------------------------- 2 of the particular employer and employee involved in an individual dispute. The program was enacted to "provide adequate income replacement for disabled workers cov- ered" under the LHWCA, "to mee[t] the needs of the injured employee and his family," and also to ensure "that the employer bears the cost of unsafe conditions," thereby "strengthen[ing] the employer's incentive to pro- vide the fullest measure of on-the-job safety." H.R. Rep. No. 1441, 92d Cong., 2d Sess. 1 ( 1972). Proper deter- mination of award disputes affects the incentive placed by the Act on employers to enhance on-the-job safety; it also affects the extent to which surviving dependents of de- ceased workers as well as disabled workers themselves wi11 have to seek financial assistance from other public programs-a result Congress specifically intended to avoid. See Pet. Br. 17-18.1 Cf. Albemarle Paper Co. v. Moody, 422 U.S. 405, 417-418 ( 1975) (backpay award decisions under Title VII of 1964 Civil Rights Act must "be measured against the purposes which inform Title VII"; "the reasonably certain prospect of a backpay award" provides "the spur or catalyst which causes em- ployers and unions to self-examine and to self-evaluate their employment practices"). Accordingly, under the LHWCA, the Director, who is the person charged with administering and enforcing the Act, has Article III stand- ing to seek judicial review of improper awards to vindicate these public interests entrusted to her responsibility-in- ___________________(footnotes) 1 Accordingly, in contrast to the ordinary situation in purely private disputes, the remedy under the LHWCA is carefully cir- cumscribed by the Act's detailed standards for calculating benefits under the LHWCA. The Act specifies what time periods compensa- tion may cover and establishes formulae for determining the amount of compensation (including minimum and maximum amounts) based on a percentage of weekly wages that varies according to such factors as the degree of disability, the part of the body injured, and in cases of death, the number of dependents. See 33 U.S.C. 906, 908, 909, 910. ---------------------------------------- Page Break ---------------------------------------- 3 terests that neither the employer nor the employee may have the same incentive to protect. 2 As we show in our opening brief, the Director also has legally cognizable interests in the propriety and sufficiency of an award under the LHWCA because of the many spe- cific duties imposed on her by Congress, see Pet. Br. 15- 16, 22-25, including her power to bring actions to enforce compensation awards, 33 U.S.C. 921 (d).3 The Director's standing to protect against injury to her duties under the Act, by challenging erroneous decisions on claims for ben- efits, cannot be distinguished materially under Article III from ether statutory schemes in which government officials seek to protect the public interest and obtain relief that also benefits private individuals. See Pet. Br. 18 (discuss- ing government's authority under Title VII of the Civil Rights Act, the Employee Retirement Income Security Act, and the Fair Labor Standards Act ); see also Shepard ___________________(footnotes) 2 Congress recognized that in some cases employers and employees might prefer to reach a settlement or to arrange their financial relationship in a different manner that might better serve their individual interests but not the public goals, but it significantly restricted their ability to do so. See 33 U.S.C. 908 (i) (employer's liability not discharged unless settlement approved by deputy com- missioner or ALJ, and settlement may be approved only if adequate and not procured by duress); 33 U.S.C. 915 (b) (prohibiting em- ployees from waiving their rights to compensation under the LHWCA); 33 U.S.C. 916 (providing that "[n] o assignment, release, or commutation of compensation or benefits due or payable" under the Act, except as provided by the Act, shall be valid). 3 One of the issues raised by the Director in the court of appeals concerned whether the Board erred in resolving as a matter of law the question whether the claimant made diligent efforts to obtain employment in the circumstances of this case, since the claimant reasonably relied on employer statements about a possible position and cooperated with a vocational counselor. How that question is resolved affects the Director's policies on vocational rehabilitation services and her duty to advise employees' regarding their obligations to seek employment during transition periods and vocational rehabilitation. See 33 U.S.C. 939 (c) (1); see also Pet. Br. 19. ---------------------------------------- Page Break ---------------------------------------- 4 v. NLRB, 459 U.S. 344, 351-352 ( 1983); Vaca v. Sipes, 386 U.S. 171, 182-183 (1967); Nathanson v. NLRB, 344 U.S. 25, 27 (1952) (NLRB is creditor within meaning of Bankruptcy Act of company against whom Board has issued backpay order); NLRB v. E.D.P. Medical Com- puter Sys., Inc., 6 F.3d 951 (2d Cir. 1993) (NLRB acts in public interest when it seeks backpay for workers in- jured by unfair labor practices). Respondent and its amici attempt to distinguish those statutes by arguing that Congress in those schemes "spe- cifically conferred standing" on a government official (Amici Br. 13) or set forth a "central governmental en- forcement mechanism" (Resp. Br. 34). These, however, are statutory, not constitutional, arguments against stand- ing. If, as we maintain, the LHWCA allows the Director to participate in LHWCA adjudications and their judicial review, then the Director has Article 111 standing to seek a compensation order that will provide the claimant his rightful benefits, just as government officials have Article III standing under numerous other statutes to vindicate the public interest by obtaining relief that benefits private individuals. Respondent contends (Br. 25-27, 28) that the Director is a "neutral" administrator. To the extent respondent means that the Director argues in favor of an accurate award under the Act regardless of who stands to benefit from any necessary correction, we agree. To the extent, however, respondent argues that the Director therefore cannot "advocate" for the position advanced by either claimants or employers (Resp. Br. 19, 25-27), we dis- agree. In any instance where a claimant seeks an accurate, adequate award of the maximum benefits to which he is entitled under the Act, the Director's interests necessarily coincide with those of the claimant. In other instances, when a claimant is seeking an award greater than what he is due under the Act, the Director's interests coincide with the employers. In either instance, the fact that the em- ployee or employer shares her interest does not mean that ---------------------------------------- Page Break ---------------------------------------- 5 the Director is either biased or no longer protecting the governmental interests conferred by the Act. Cf. General Tel. Co. v. EEOC, 446 U.S. 318, 326 ( 1980) (when "EEOC acts, albeit at the behest of and for the benefit of specific individuals, it acts also to vindicate the public interest in preventing employment discrimination" ).4 The Director has a material interest in the proper construction and application of the Act, and that interest is engaged each time the Director concludes that the Board has in- correctly adjudicated a particular claim, no matter who stands to benefit from the resolution of the dispute-the affected employee, employer, or insurer. Respondent also argues (Br. 19, 31-32) that if the Director participates in proceedings where a claim award is being determined, it "may result in the Director taking positions which are in direct conflict with her pecuniary interest in protecting the assets of the Special Fund." Resp. Br. 31. As respondent points out, even in this case, there is a potential to increase the liability of the Special Fund, depending on what degree of disability is ___________________(footnotes) 4 Respondent's assertions that "there is no need for the Director to act as an advocate for claimants" (Br. 29) ignores the fact that by urging an accurate award for the claimant in this case, the Director is espousing her own interests as the official charged with administering and enforcing the Act, which here coincide with those of the claimant. In any event, there is no legal prohibition against the Director's acting as an advocate for or protector of a claimant's interests, inasmuch as Congress determined that in some instances there is a need for her to do so. See, e.g., 33 U.S.C. 939 (c) (1) (authorizing Director to provide legal assistance to claimants): 33 U.S.C. 908(i) (authorizing Director to approve settlements only after review to ensure not inadequate and not procured by duress). Similarly, Congress determined that the Director's interests would sometimes coincide with the employers' interests. See, e.g., 33 U.S. C. 907 (b) (Secretary has authority to determine sufficiency of medical care and may on his own, or at request of employer, order a change of physicians or hospitals when desirable, including when the charges (which the employer pays, 33 U.S.C. 907 (a) ) exceed customary community charges ). ---------------------------------------- Page Break ---------------------------------------- 6 determined, what length of time payments are awarded, ibid., and whether respondent becomes insolvent. Id. at 32. Respondent reasons that as administrator of the Special Fund, the Director "is obligated to protect its assets," id. at 31, and that there is therefore a potential conflict of interest when the Director advocates a position that could increase the financial burden on the Special Fund. Id. at 31-32. Again, respondent misperceives the duties Congress im- posed on the Director under the LHWCA. As adminis- trator of the Special Fund, the Director's role is not to resist payment of meritorious claims; to the contrary, her duty is to authorize payment on claims that meet the criteria for Special Fund payment. The fact that an in- crease of a claimant's award would increase the liability of the Fund does not present a conflict of interest; it is wholly consistent with the duties assigned to the Director under the Act, as long as the award is an accurate deter- mination of what is due the claimant under the Act.5 Cf. ___________________(footnotes) 5 Respondent concedes that the Director has Article III stand- ing to appeal awards decisions in certain circumstances, e.g., where the award affects the Special Fund or where the decision deals "with her procedural rules for administering Longshore Act claims." See Resp. Br. 28. Respondent also states that the Director "arguably has Article III standing to appeal decisions on the jurisdictional scope of the Longshore Act, since such decisions define her administration." Ibid. Likewise, amici acknowledge (Br. 21, 18-19) that the Director "may well incur injury in fact * * * when [ ] a [Board] order conflicts with her delegated statu- tory enforcement responsibilities," which amici identify (Br. 19) as: the Secretary's authority to enforce final compensation awards, 33 U.S.C. 921 (d) ; his authority over the Special Fund, 33 U.S.C. 944: and his authority to promulgate and enforce safety rules, 33 U.S.C. 941. Respondent and amici suggest, however. that the Director does not have statutory standing under 33 U.S.C. 921 (c) to protect even those concededly legally cognizable interests against injury because, they assert, the Director is not a "person" within the meaning of 921 (c). Resp. Br. 38-39; Amici Br. 19. That contention is contrary to the court of appeals' express holding (Pet. App. 9a, 13a), and, as we show, pp. 15-17, infra, is in error. ---------------------------------------- Page Break ---------------------------------------- 7 Nevada v. United States, 463 U.S. 110, 127-128 ( 1983) (noting responsibility of Secretary of the Interior to per- form and reconcile competing statutory duties affecting private interests). 2. Respondent and amici repeatedly argue (Resp. Br. 7-9, 25, 28-29, 38; Amici Br. 13-14) that because the purpose underlying the 1972 amendments to the LHWCA was to separate the administrative and adjudicatory func- tions under the LHWCA, Congress therefore intended to restrict the administrator's right to judicial review. While we agree that a major purpose of the 1972 amendments was to remove the administrator from also serving the role of adjudicator, that rearrangement undermines rather than supports respondent's position that the administrator can- not seek judicial review of the Board's decisions. A purely adjudicatory entity has no legally cognizable interest in defending its decision on review; hence, a dis- trict court does not appear in the court of appeals to defend its decisions. For the same reason, an administra- tive agency whose role is purely adjudicatory "has no duty or interest in defending its decision on appeal." Oil, Chem. & Atomic Workers Int'1 Union v. OSHRC, 671 F.2d 643, 652 (D.C. Cir.) (per curiam), cert. denied, 459 U.S. 905 ( 1982). That is one of the reasons courts have declined to accord respondent status to the Benefits Review Board, a purely adjudicatory body, in Section 21( c) review proceedings before the court of appeals. Nacirema Operating Co. v. Benefits Review Bd., 538 F.2d 73, 75 (3d Cir. 1976) (Board "performs a review func- tion which prior to the 1972 amendments was performed by the district courts [and like] * * * those courts ha[s] no duty or interest in defending [its] actions on appeal"); McCord v. Benefits Review Bd., 514 F.2d 198,200 (D.C. Cir. 1975) ("[t]o require the Board to appear as a party would parallel requiring the [d]istrict court to appear and defend its [own] decision [on] * * * appeal"). Prior to 1972, the situation under the LHWCA was different. The administrative function was vested in the ---------------------------------------- Page Break ---------------------------------------- 8 same persons as the adjudicatory function-the deputy commissioners. A deputy commissioner was accorded standing to seek court of appeals review of a district court judgment overturning the commissioner's decision on a claim, even in the absence of an appeal by another party. See Pet. Br. 26. (Neither respondent nor amici dispute the deputy commissioners' pre-1972 authority to seek court of appeals review of district court decisions. ) This was so because the interest that supported the deputy com- missioners' standing to appear before courts and secure judicial review was premised on their policy making, ad- ministrative, and enforcement interests, not on their ad- judicatory function. When the 1972 amendments sepa- rated those functions, the natural inference is that Con- gress acted on the premise that the administrator, now in the person of the Director, would retain the right to seek federal court of appeals review of claim determinations she believes to be erroneous. Neither respondent nor amici point to any evidence that the 1972 amendments eliminated the authority of the administrator to seek judicial review. Their argument appears to view any official who participates as a party in an adjudication as exercising some type of "adjudica- tory" authority. The adjudicator itself (the Board) is, of course, the only entity serving an adjudicatory function in the proceedings. The participation of the parties (includ- ing the Director ) does not mean they too are performing an adjudicatory role. Rather, the parties are properly ad- vocating their distinct interests. Respondent claims that Congress "did not intend the administrative function to be involved in the adjudication process." Resp. Br. 8. Yet, the excerpt from the 1972 House Report cited by respond- ent in support of that proposition merely reveals an intent to keep separate the functions of administering the pro- gram and "sitting in judgment" at the hearing, i.e., being the adjudicator; it does not indicate an intent to prevent the administrator from participating as a party in the ---------------------------------------- Page Break ---------------------------------------- 9 adjudicatory process. See Resp. Br. 8, quoting H.R. Rep. No. 1441, supra, at 11; Amici Br. 6 (same). In fact, by transferring the administrator's adjudicatory role to ALJs and the Board, the administrator's enforce- ment role and concomitant interest in securing judicial review of decisions adverse to her position was enhanced, not diminished. The amendments freed the administrator to play a fuller role in the claims process, without inter- fering with the independent role of the Board. The sep- aration of functions accords the Director greater ability to advocate her administrative interest as a participant in proceedings under the Act. See S. Rep. No. 1125, 92d Cong., 2d Sess. 14 (1972) ("it will be extremely impor- tant to have full time able administrators who will not also have to wear the dual hat of being hearing officers for purposes of the disputes brought under this statute"). 3. Respondent contends that the Secretary is impermis- sibly seeking an "advisory opinion" on the correctness of competing interpretations of the Act by seeking, through one of his delegates (the Director), review of the decision of another of his delegates (the Board). See Resp. Br. 22 n. 13, 23-25, 29, 36-38, 39. This argument miscompre- hends the nature of the Benefits Review Board. The Board, insofar as it issues decisions on claims, is not a delegate of the Secretary; that adjudicatory duty is assigned by statute directly to the Board itself. See 33 U.S.C. 921(b)(2). In arguing to the contrary, respond- ent mistakenly relies (Br. 37) on 33 U.S.C. 921 (b)(1), which permits the Secretary to delegate to the Board's chairman oversight of "all administrative functions" nec- essary to operate the Board. That provision does not con- cern delegation of adjudicatory functions, which are statu- torily lodged in the Board in the first instance. Congress clearly intended the Board's adjudicatory function to be exercised independently of the administra- tion of the Act, and it entrusted the Secretary with the obligation to ensure that independence. See H.R. Rep. No. 1441, supra, at 11; see also Kalaris v. Donovan, 697 ---------------------------------------- Page Break ---------------------------------------- 10 F.2d 376, 390 & 392 n.64 (D.C. Cir.), cert. denied, 462 U.S. 1119 ( 1983); Director, OWCP v. Eastern Coal Corp., 561 F.2d 632, 649 (6th Cir. 1977) (Board is independent of Secretary "as far as policy and decision making are concerned"). The Secretary has therefore accorded the Board complete independence from both the Director and the Secretary in its decisionmaking. See Sec. Order 38-72, 38Fed. Reg. 90, 91 ( 1973) ( Secretary's order establish- ing Board directs Under Secretary of Labor to "promul- gate such rules and regulations as may be necessary or appropriate for effective operation of the Board as an independent quasi-judicial body in accordance with the provisions of the statute"); see also 20 C.F.R. 801.104. Indeed, courts have held that the Board has the power to declare the Secretary's regulations to be contrary to law. Gibas v. Saginaw Mining Co., 748 F.2d 1112, 1119-1120 (6th Cir. 1984), cert. denied, 471 U.S. 1116 (1985); Carozza v. United States Steel Corp., 727 F.2d 74,77 (3d Cir. 1984). The Board does not, however, have authority to engage in administration of the LHWCA by promulgating rules. See Ryan-Walsh Stevedoring Co. v. Trainer, 601 F.2d 1306, 1314 n.7 (5th Cir. 1979); 33 U.S.C. 921(b)(3). To be sure, the Board differs somewhat from other fully independent adjudicatory bodies, such as the Occu- pational Safety and Health Review Commission (OSHRC), see 29 U.S.C. 661, in that the Board is placed within the Department of Labor and the Secretary has the power to appoint and remove members as well as to exercise other operational control over the Board. Kalaris, 697 F.2d at 390-391. Cf. Weiss v. United States, 114 S. Ct. 752 (1994). Nonetheless, the Secretary plays no part in the Board's determination of an award.6 Thus, although the ___________________(footnotes) 6 Amici err in chastising (Br. 16 & n.12) the Department for "commingling [administrative and adjudicatory] functions" by permitting "the OWCP and the `quasi-independent' BRB [to] share the same attorneys and legal advice from the Office of the ---------------------------------------- Page Break ---------------------------------------- 11 Board is located within the Department of Labor, it, like OSHRC, deviates "from the conventional agency model in that it is purely an adjudicator; there is no intermixing of regulatory, prosecutorial, and adjudicative functions." in re Perry, 882 F.2d 534, 537 (lst Cir. 1989); see also Martin v. OSHRC, 499 U.S. 144, 151 ( 1991). The Board's decisions therefore cannot be considered "unitary" agency decisions, as respondent and amici sug- gest (Resp. Br. 20; Amici Br. 15), because they are not decisions of the Secretary and do not reflect the Secre- tary's resolution of the claim. In fact, the bifurcated structure of the administrative scheme established by the LHWCA reinforces the fact that the Secretary and the Board may reach differing positions in light of their dif- ferent roles. The Secretary "enjoys readily identifiable structural advantages" over the Board in certain respects because he participates in informal resolutions of claims, 33 U.S.C. 908 (i), and "comes into contact with a much greater number of regulatory problems than does the [Board], which encounters only those regulatory episodes resulting in contested [claims] ." Martin V. OSHRC, 499 U.S. at 152. Thus, the Secretary, through the Director, is free to seek judicial review of Board decisions when, in his view, the Board incorrectly has resolved a claim. The Director is clearly not seeking an advisory opinion from the court of appeals, as respondent suggests (Br. 22 n. 13, 24). If the Secretary were to prevail on the merits in this case, the victory would have a concrete effect: It would result in entry by an OWCP district director of a new compensation order requiring the employer to pay a ___________________(footnotes) Solicitor of Labor." In fact, the Board employs its own staff of attorneys, who are in the Board's Office of General Counsel, wholly apart from the Office of the Solicitor of Labor. The Office of the Solicitor represents the Board, in conformity with 33 U.S.C. 921a, only in the rare instances when the Board has been the subject of a mandamus action, and it is the Solicitor's policy to assign those cases to attorneys from the Solicitor's Office who do not represent the Director before the Board. ---------------------------------------- Page Break ---------------------------------------- 12 higher level of benefits to his injured employee. The Sec- retary cannot provide such relief; under the terms of the LHWCA, such relief can come only from the court of appeals once a final Board decision has been entered. Cf. Maine v. Taylor, 477 U.S. 131, 137 ( 1986) (a State, as intervenor in federal criminal prosecution, has standing to appeal ruling invalidating state law even though federal prosecutor did not seek further review, because contro- versy remained live inasmuch as reversal of judgment would result in automatic reinstatement of defendant's conviction ); United States v. Nixon, 418 U.S. 683, 692- 697 (1974).7 4. Although respondent and its amici do not dispute that the Secretary's regulations specifically identify the Director as a party entitled to assert his interest in the administrative process and seek judicial review, they sug- gest that those regulations conflict with the Act. Amici Br. 5-1 1; Resp. Br. 24 n. 14, The amici go so far as to contend (Br. 8), without any supporting authority, that the Secretary overstepped his authority by authorizing the Director to appear as a "part[y] in interest" in adminis- trative proceedings. That contention has no merit. See Ingalls Shipbuilding Div. v. White, 681 F.2d 275, 288 (5th Cir. 1982) (upholding Director's party-in-interest status in administrative proceedings), overruled in part on other grounds, Newpark Shipbuilding & Repair, Inc. v. Roundtree, 723 F.2d 399 (5th Cir.), cert. denied, 469 U.S. 818 ( 1984). The Act expressly authorizes the Secre- tary to issue rules and regulations for purposes of admin- ___________________(footnotes) 7 Respondent errs in suggesting (Br. 7, 20, 22 & n.13, 36-37) that petitioner lacks Article III standing because the sole contro- versy here is between the Director and the Board, and that the Director's injury is not attributable to respondent, It is respond- ent that has refused to pay what the Director contends is the appropriate disability benefit for the period in question; thus, there is a controversy between the parties "attributable to the [conduct of the] opposing party (the employer) [as] required for Article III * * * standing." Resp. Br. 20. Compare INS V. Chadha, 462 U.S. 919, 939-940 (1983) . ---------------------------------------- Page Break ---------------------------------------- 13 istering the Act, 33 U.S.C. 939(a), and it is a "very basic tenet of administrative law that agencies should be free to fashion their own rules of procedure." Vermont Yankee Nuclear Power Corp. v. Natural Resources De- fense Council, Inc., 435 U.S. 519, 544 ( 1978). That tenet is particularly applicable here, because Congress in 1972 intended "that the Secretary take full advantage of the requirement of separating the functions under this statute to consider a complete reorganization of the * * * administration of th[e] Act" and "to revise the regulations under this Act which ha[d] not been amended for many years." S. Rep. No. 1125, supra, at 14. Amici also argue (Br. 8-9) that 33 U.S.C. 921 (b) (4), which permits the Board to remand a case to the ALJ without the consent of "parties in interest," somehow es- tablishes that the Director cannot be a party in interest and therefore precludes her from participating in the ad- ministrative process. To the contrary, the most natural reading of that statutory provision is that the Secretary is one of the parties in interest before the Board. The Secre- tary is expressly accorded the authority to request a re- mand from the Board in recognition of his special role in protecting the public interest through accurate claim deter- minations. Indeed, the most natural way for the Secretary to make such a request would be by participating as a party to the administrative proceeding. The arguments pressed by respondent and amici with regard to the Director's seeking judicial review are un- availing as well. Respondent attempts (Br. 9) to limit the significance of 33 U.S.C. 921a, which allows attor- neys appointed by the Secretary to represent him "in any court proceeding]." Contrary to respondent's contention (Br. 9) that the provision is limited to "enforcement pro- ceeding[s]," the provision by its terms is not so limited, and clearly encompasses Section 21 (c) review proceed- ings in the court of appeals.8 ___________________(footnotes) 8 The amendment to Section 21a of the Act was described in the legislative history as follows: "Under present law, it is the obliga- ---------------------------------------- Page Break ---------------------------------------- 14 5. Respondent attempts (Br. 35) to downplay the sig- nificance of the Black Lung Benefits Act (BLBA), which adopted the pertinent LHWCA procedures. See also Amici Br. 14-15 & n. 11. Respondent points out that the BLBA contains a provision that specifies that the Director has party status. 30 U.S.C. 932(k). We show in our opening brief, however, that the legis- lative history of the BLBA provision makes clear that at the time Congress enacted that provision, it viewed the Secretary as already having standing under the LHWCA to seek judicial review based on his "interest as the offi- cer charged with the responsibility for carrying forth the intent of Congress with respect to the Act." S. Rep. No. 209, 95th Cong., 1st Sess. 22 ( 1977). Congress enacted 30 U.S.C. 932(k) to confirm that understanding at the time it brought the BLBA under the same administrative scheme. Neither respondent nor its amici provide sound reasons for rejecting that considered judgment or for treating the black lung scheme differently than the longshore scheme. Both respondent and the amici assert (Resp. Br. 35-36; Amici Br. 15 n. 11 ) that the BLBA is different because in some cases the Black Lung Disability Trust Fund, which the Director administers, is liable on a claim. Many claims under the BLBA, however, do not implicate the Black Lung Disability Trust Fund,9 and there is no indication ___________________(footnotes) tion of the United States attorney in the district where a case is pending to represent the Secretary or deputy commissioner in cases under the Act. Under the amendment made by this section, attor- neys will be appointed by the Secretary to represent the Secretary, the deputy commissioner, a hearing officer, or the Board, except in proceedings in the Supreme Court." H.R. Rep. No. 1441, supra, at 21-22. 9 Respondent states (Br. 36) that in the majority of black lung claims the Black Lung Disability Trust Fund is primarily liable for the claim. This is an overstatement. The Director estimates, for example, that of claims decided during fiscal year 1994 at the district director level, see 20 C.F.R. 725.410-725.422, no more than ---------------------------------------- Page Break ---------------------------------------- 15 that 30 U.S.C. 932(k) was intended to apply only to cases implicating the Fund. Indeed, the legislative history of the provision makes clear that a financial stake is not a prerequisite to the Director's standing, and the Direc- tor's standing has been upheld under the Act even in the absence of a pecuniary interest. Director, OWCP v. Rochester & Pittsburgh Coal Co., 678 F.2d 17, 18 n.2 (3d Cir. 1982). Denying the Director standing under the LHWCA, or limiting her standing to cases in which she has a financial interest, would create unwarranted divergence between LHWCA and BLBA procedures, whereas Congress intended that the procedures for ad- ministrative and judicial review under the statutes be the same. 6. Finally, respondent and amici argue (Resp. Br. 20, 23, 38-39; Amici Br. 3, 11-13) that the Director does not have statutory standing under 33 U.S.C. 921 (c) as a "person adversely affected or aggrieved," because she is not a "person" within the meaning of the LHWCA. Their argument appears to be that because the statutory defini- tion of "person" (33 U.S.C. 902(1)) does not in terms include "Secretary," and because there also is a statutory definition of "Secretary" (33 U.S.C. 902(6)), the Secre- tary is necessarily excluded from being considered a per- son under the Act. That argument is illogical and inconsistent with the structure of the Act. "Person" is defined for purposes of the Act as an "individual, partnership, corporation, or association." 33 U.S.C. 902(1). "Secretary" is defined to be the Secretary of Labor. 33 U.S.C. 902(6). The mere fact that there is a separate definition to explain who ___________________(footnotes) 30% are claims in which the Director arguably has a financial interest, i.e., are claims in which the Trust Fund is primarily liable or are claims on which, although a responsible operator has been identified, the Trust Fund is paying interim benefits, pending final resolution, based on the district director's initial finding of en- titlement. See 20 C.F.R. 725.522. ---------------------------------------- Page Break ---------------------------------------- 16 is referred to by the term "Secretary" does not mean that the Secretary is not an "individual" for purposes of the definition of "person." In fact, if respondent's logic were correct, employers would not have standing under 33 U.S.C. 921(c), because "Employer" is defined separately in 33 U.S.C. 902(4) and the definition of "person" does not specifically include "employer." It is clear that the Director is an "individual," and hence a "person" entitled to obtain review under 33 U.S.C. 921 (c). The term "person" may encompass a govern- mental official, such as the Director, where the context of the statute so indicates. See generally Ohio v. Helvering, 292 U.S. 360, 370 ( 1934) (whether term "person" in- cludes a State or United States depends upon the legisla- tive context in which the word is found); see also Interna- tional Primate Protection League v. Administrators of Tu- lane Educ. Fund, 500 U.S. 72, 83 ( 1991) ("conventional reading of `person' [as excluding the sovereign] may * * * be disregarded if `[t]he purpose, the subject matter, the context, the legislative history, [or] the executive interpre tation of the statute * * * indicate an intent, by the use of the term, to bring state or nation within the scope of the law' "); Monell V. Department of Social Serv., 436 U.S. 658 ( 1978) (municipal officials are persons under 42 U.S.C. 1983); Far East Conference v. United States, 342 U.S. 570, 576 ( 1952) (United States is "person" who may file a complaint under Shipping Act of 1916). The LHWCA'S structure and history compel the conclu- sion that the Director is a "person." Indeed, were this not so, the Director would be powerless to seek review of any Board decision, a result that would be inconsistent with the holding of the court below and of every court of appeals that has addressed the question of the Director's standing. The court of appeals expressly held that the Director is a "person adversely affected or aggrieved" by the Board's ruling on whether respondent was entitled to relief from ---------------------------------------- Page Break ---------------------------------------- 17 the Special Fund under Section 8(f) of the Act, 33 U.S.C. 908(f), and reversed the Board's ruling on that issue. See Pet. App. 9a, 13a (Director is "person * * * aggrieved" by a Board ruling that the Special Fund is liable under Section 8(f)). Thus, contrary to respond- ent's assertion (Br. 39) that the court of appeals "did not * * * have to reach the issue," the court of appeals' holding necessarily includes a determination that the Di- rector is a "person" within the meaning of the Act-a holding that respondent did not challenge by filing a cross- petition for certiorari under this Court's Rule 12.3. Moreover. no court has suggested that the Director is without any authority to seek review under 33 U.S.C. 921 (c), which would be the necessary consequence of holding that the Director is not a "person" under the Act. Every court that has addressed the issue in the con- text of a Section 8(f) dispute has accorded the Director standing to seek judicial review. See, e.g., Director, OWCP v. Cargill, Inc., 718 F.2d 886, 888 (9th Cir. 1983); Direc- tor, OWCP v. Newport News Shipbuilding & Dry Dock Co., 676 F.2d 110, 114 (4th Cir. 1982); Director, OWCP V. National Van Lines, Inc., 613 F.2d 972, 977 n.6 (D.C. Cir. 1979), cert. denied, 448 U.S 907 ( 1980); see also Director, OWCP v. General Dynamics Corp., 982 F.2d 790 (2d Cir. 1992) (petition for review granted). Amici (Br. 16-1 7; 21-22) err in suggesting that the Director's statutory standing is precluded by the Adminis- trative Procedure Act (APA), which, unlike the LHWCA, expressly excludes federal agencies from those "persons" that it authorizes to obtain judicial review of agency ac- tion. See 5 U.S.C. 702, 701 (b) (2), 551 (2). That provi- sion is not applicable to judicial review proceedings under the LHWCA 10 because, according to the APA itself, "[t]he ___________________(footnotes) 10 As we note in our opening brief, the LHWCA specifies that hearings before ALJs shall be conducted in accordance with APA procedures. See 33 U.S.C. 919 (d). Although amici cite (Br. 17 n.13) Director, OWCP V. Greenwich Collieries, 114 S. Ct. 2251 ---------------------------------------- Page Break ---------------------------------------- 18 form of proceeding for judicial review is the special statu- tory review proceeding relevant to the subject matter in a court specified by statute." 5 U.S.C. 703. In the case of Benefits Review Board decisions under the LHWCA, that special statutory review proceeding is the proceeding authorized by Section 21 (c) of the LHWCA, 33 U.S.C. 921 (c), which must be interpreted according to its own terms and the structure and purposes of the LHWCA as a whole. For the foregoing reasons and those stated in petition- er's opening brief, the judgment of the court of appeals should be reversed, and the case should be remanded for further proceedings. Respectfully submitted. DREW S. DAYS, III Solicitor General THOMAS S. WILLIAMSON, JR. Solicitor of Labor DECEMBER 1994 ___________________(footnotes) (1994), that decision is inapposite. The Court there held that Section 7 (c) of the APA, 5 U.S.C. 556 (c), placing the burden of proof on a proponent of an order, governs in ALJ hearings because the LHWCA does not indicate that a contrary rule applies. * U.S. GOVERNMENT PRINTING OFFICE; 1994 387147 20025 ---------------------------------------- Page Break ---------------------------------------- No. 93-1783 In the Supreme Court of the United States OCTOBER TERM, 1993 DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, PETITIONER v. NEWPORT NEWS SHIPBUILDING AND DRY DOCK COMPANY, ET AL. PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT THOMAS S. WILLIAMSON, Jr. Solicitor of Labor ALLEN H. FELDMAN Associate Solicitor STEVEN J. MANDEL Deputy Associate Solicitor MARK S. FLYNN Senior Appellate Attorney Department of Labor Washington D.C. 20210 DREW S. DAYS, III Solicitor General EDWIN S. KNEEDLER Deputy Solicitor General BETH S. BRINKMANN Assistant to the Solicitor General Department of Justice Washington, D.C. 20530 (202)514-2217 ---------------------------------------- Page Break ---------------------------------------- QUESTION PRESENTED Whether the standing of the Director of the Office of Workers' Compensation Programs in the United States Department of Labor, to petition the court of appeals for review of a decision of the Benefits Review Board under Section 21(c) of the Longshore and Harbor Workers' Compensation Act, 33 U.S.C. 921(c), is limited to issues that affect the Director's pecuniary interest or disrupt a specific administrative function. (I) ---------------------------------------- Page Break ---------------------------------------- II PARTIES TO THE PROCEEDINGS Jackie Harcum was the claimant in the proceeding below where the employer, Newport News Shipbuilding and Dry Dock Company, was the respondent and the Director of the Office of Workers' Compensation Pro- grams in the United States Department of Labor was the petitioner. ---------------------------------------- Page Break ---------------------------------------- TABLE OF CONTENTS Opinions below . . . . 1 Jurisdiction . . . . 2 Statutory and regulatory provisions involved . . . . 2 Statement . . . . 2 Reasons for granting the petition . . . . 10 Conclusion . . . . 25 Appendix A . . . . 1a Appendix B . . . . 25a Appendix C . . . . 27a Appendix D . . . . 37a Appendix E . . . . 63a TABLE OF AUTHORITIES Cases: Alfred L. Snapp & Son, Inc. v. Puerto Rico, 458 U. S. 592 (1982) . . . . 21 American Ship Bldg. Co. v. Director, OWCP, 865 F.2d727(6th Cir. 1989) . . . . 24 Baker v. Carr, 369 U.S. 186(1962) . . . . 20 Be/iv. New Jersey, 461 U.S. 773 (1983) . . . . 19 Boudreaux v. American Workover, Inc., 680 F.2d 1034 (5th Cir. 1982), cert. denied, 459 U.S. 1170 (1983) . . . . 24 Coleman v. Miller, 307 U.S. 433 (1939) . . . . Curtis v. Schlumberger Offshore Serv., Inc., 849 F.2d 805(3d Cir. 1988) . . . . 11, 12 Debs, ln re,158U.S. 564(1895) . . . . 21 Director, OWCP v. Alabama By-Products Corp., 560 F.2d 710(5th Cir. 1977) . . . . 19-21 (III) ---------------------------------------- Page Break ---------------------------------------- IV Cases-Continued: Page Director, OWCP v. Bethlehem Steel Corp. 949 F.2d 185(5th Cir. 1991) . . . . 13, 24 Director, OWCP v. Donzi Marine, Inc., 586 F.2d 377(5th Cir. 1978) . . . . 8, 9, 1O, 2O, 24 Director, OWCP v. Eastern Coal Corp., 561 F.2d 632 (6th Cir. 1977) . . . . 16, 17, 20, 22 Director, OWCP v. General Dynamics Corp., 982 F.2d 790(2d Cir. 1992) . . . . 24 Director, OWCP v. National Mines Corp., 554 F.2d 1267(4th Cir. 1977) . . . . 19 Director, OWCP v. National Van Lines, Inc., 613 F.2d 972 (D.C. Cir. 1979), cert. denied, 448 U.S. 907(1980) . . . . 10 Director, OWCP v. Newport News Shipbuilding & Dry Dock Co., 676 F.2d 110 (4th Cir. 1982) . . . . 9 Director, OWCP v. O'Keefe, 545 F.2d 337 (3d Cir. 1976) . . . . 13 Director, OWCP v. Peabody Coal Co., 554 F.2d 310(7th Cir. 1977) . . . . 20 Director, OWCP v. Perini N. River Assocs., 459 U. S. 297(1983) . . . . 10, 14 Director, OWCP v. Rochester & Pittsburgh Coal Co., 678 F.2d 17(3d Cir. 1982) . . . . 13 Donovan v. University of Texas at El Paso, 643 F.2d 1201(5th Cir. 1981) . . . . 22 Flast v. Cohen, 392 U.S. 83(1968) . . . . 15 Fusco v. Perini N. River Assocs., 601 F.2d 659 (2d Cir. 1979), vacated and remanded, 444 U.S. 1028, reinstated on remand, 622 F.2d 1111 (2d Cir. 1980), cert. denied, 449 U.S. 1131 (1981) . . . . 10 General Tel. Co. v. EEOC, 446 U.S. 318 (1980) . . . . 22 Gladstone, Realtors v. Village of Bellwood, 441 U. S. 91 (1979) . . . . 23 Goldsmith v. Director, OWCP, 838 F.2d 1079 (9th Cir. 1988) . . . . 11 Heckman v. United States, 224 U.S. 413 (1912) . . . . 22 ---------------------------------------- Page Break ---------------------------------------- V Cases-Continued: Page Henderson v. Glens Falls Indem. Co., 134 F.2d 320 (5th Cir.), cert. denied, 319 U.S. 756 (1943) . . . . 17 I. T. O. Corp. v. Benefits Review Bd., 563 F.2d 646 (4th Cir. 1977), reinstating in pertinent part, 542 F.2d 903 (4th Cir. 1976), vacated and re- manded, 433 U. S. 904(1977 ) . . . . 9, 11 Ingalls Shipbuilding Div., Etc. v. White, 681 F.2d 275 (5th Cir. 1982), overruled in part on other grounds, Newpark Shipbuilding & Repair, Inc. v. Roundtree, 723 F.2d 399 (5th Cir.), cert. denied,469 U. S. 818(1984) . . . .1 Kalaris v. Donovan, 697 F.2d 376 (D.C. Cir.), cert. denied, 462 U.S. 1119(1983) . . . . 4, 5, 12 Krolick Contracting Corp. v. Benefits Review Bd., 558 F.2d 685(3d Cir. 1977) . . . . 19 Lujan v. Defenders of Wildlife, 112 S. Ct. 2130 (1992) . . . . 15, 23 Moe v. Confederated Salish & Kootenai Tribes, 425 U. S. 463(1976) . . . . 22 Mullins Coal Co. v. Director, OWCP, 484 U.S. 135 (1987 ) . . . . 24 Newport News Shipbuilding & Dry Dock Co. v. Howard, 904 F.2d 206 (4th Cir. 1990) . . . . 24 Northeast Marine Terminal Co. v. Caputo, 432 U. S. 249 (1977 ) . . . . 21 Potomac Elec. Power Co. v. Director, OWCP, 449 U. S. 268 (1980) . . . . 24 Sea-Land Service, Inc. v. Rock, 953 F.2d 56 (3d Cir. 1992) . . . . 24 Secretary of Labor v. Fitzsimmons, 805 F.2d 682 (7th Cir. 1986) . . . . 22 Shahady v. Atlas Tile & Marble Co., 673 F.2d 479 (D. C. Cir.1982) . . . . ll, 15, 17, 22 Sierra Club v. Morton, 405 U.S. 727 (1972) . . . . 15 Stevens v. Director, OWCP, 909 F.2d 1256 (9th Cir. 1990), cert. denied, 498 U.S. 1073 (1991) . . . . 6 ---------------------------------------- Page Break ---------------------------------------- VI Cases - Continued: Page Stevens v. Lockheed Shipbuilding Co., 22 Ben. Rev. Bd. Serv. (MB) 155 (1989), rev'd, 909 F.2d 1256 (9th Cir. 1990), cert. denied, 498 U.S. 1073 (1991 ) . . . . 6 Thornton v. Brown & Root, Inc., 707 F.2d 149 (5th Cir. 1983), cert. denied, 464 U.S. 1052 (1984) . . . . 11 Tiger v. Western investment Co., 221 U.S. 286 (1911) . . . . 19 Trafficante v. Metropolitan Life Ins. Co., 409 U.S. 205 (1972 ) . . . . 20, 23 United States v. Federal Maritime Comm'n, 655 F.2d247(D.C. Cir. 1980) . . . . 22 United States v. Federal Maritime Comm'n, 694 F.2d793(D.C. Cir. 1982) . . . . 22 United States ex rel. Chapman v. Federal Power Comm'n, 345 U.S. 153(1953) . . . . 21 Valley Forge Christian College v. Americans United for Separation of Church & State, Inc., 454 U. S. 464(1982 ) . . . . 23 Voris v. Eike/, 346 U.S. 328(1953) . . . . 21 West Virginia Univ. Hospitals, Inc. v. Casey, 499 U. S. 83 (1991 ) . . . . 19 Zapata Haynie Corp. v. Barnard, 933 F.2d 256 (4th Cir. 1991) . . . . 24 Constitution, statutes, regulations and rules: U. S. Const. Art. 111 . . . . 10, 14, 15, 20, 23 Black Lung Benefits Act, 30 U.S.C. 932(a) . . . . 18 Black Lung Benefits Reform Act of 1977, Pub. L. No.95-239, 92 Stat. 95 . . . . . . . . . . . . . . . . . . . . . . 18 7(h), 92 Stat. 99(30 U.S.C. 932(k)) . . . . . . . . 18, 19 Longshore and Harbor Workers' Compensation Act, as amended, 33 U.S.C. 901 et seq . . . . 2 33 U.S.C. 907 . . . . 2, 16 33 U.S.C. 908(f) (8( f)) . . . . 5 ---------------------------------------- Page Break ---------------------------------------- VII Statutes, regulations and rules - Continued: Page 33 U.S.C. 908(i) . . . . 2, 16 33 U.S.C. 913(a) . . . . 3 33 U.S.C. 919(c) . . . . 3 33 U.S.C. 919(d) . . . . 3 33 U.S.C. 919(e) . . . . 3 33 U. S. C. 921(b) . . . . 2, 63a 33 U. S. C. 921(b)(l) . . . . 4 33 U. S. C. 921(b)(3) . . . . 4, 6 33 U.S.C. 921(c) (21(c)) . . . . passim 33 U. S. C. 921(d) . . . . 2, 3, 65a 33 U. S. C. 921a . . . . 2, 3, 16, 65a 33 U. S. C. 928(a) . . . . 23 33 U. S. C. 939(a) . . . . 2, 3, 15, 65a 33 U. S. C. 939(b) . . . . 3 33 U. S. C. 939(c) . . . . 2, 3, 16, 66a 33 U. S. C. 941 . . . . 3, 16 33 U. S. C. 944 . . . . 3, 16 33 U. S. C. 944(a) . . . . 5 Longshoremen's and Harbor Workers' Compensa- tion Act, ch. 509, 21(b), 44 Stat. 1436 (1927) (33 U. S. C. 921(b) (1970)) . . . . 17 Longshoremen's and Harbor Workers' Compensa- tion Act Amendments of 1972, Pub. L. No. 92-576, 86 Stat. 1251 . . . . 4 28 U. S. C. 1254( 1) . . . . 14 28 U. S. C. 1291 . . . . 4,17 20 C. F. R.: Section 701.201 . . . . 2, 3, 67a Sections 701.201-701.203 . . . . 3 Section 701.202 . . . . 2, 3, 67a Section 701.202(a) . . . . 19 Section 701.202( f) . . . . 19 Section 701.301 (a)(7) . . . . 3 Sections 702.301 -702.317 . . . . 3 Section 702.333 . . . . 2, 67a ---------------------------------------- Page Break ---------------------------------------- VIII Regulations and rules - Continued: Page Section 702.333 (a) . . . . 3 Section 702.333( b) . . . . 4, 15 Sections 702.348-702 349. . . . 3 Section 801.2(a)(10) . . . . 4, 15 Section 801.102 . . . . 2, 6, 8a Section 802.201 (a)(l) . . . . 4, 15 Section 802.410 . . . . 2, 5, 68a Section 802.410(b) . . . . 4, 15, 68a Fed. R. App. P. 15(a) . . . . 11, 12 Fed. R. Civ. P. 24 . . . . 11 Miscellaneous: E. Chemerinsky, Federal Jurisdiction (1989) . . . . 8 42 Fed. Reg. 16,133 (1977 ) . . . . 5 55 Fed. Reg. 9033 (1990) . . . . 3 H.R. Rep. No. 1441, 92d Cong., 2d Sess. (1972 ) . . . . ...16, 8, 21 A. Larson, The Law of Workmen's Compensation (1993): Vol. 1 . . . . 21 VoI. 3 . . . . 21 S. Rep. No. 1125, 92d Cong., 2d Sess. (1972) . . . . 18, 21-22 S. Rep. No. 209, 95th Cong., 1st Sess. (1977) . . . . 19 ---------------------------------------- Page Break ---------------------------------------- OCTOBER TERM, 1993 No. DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, PETITIONER NEWPORT NEWS SHIPBUILDING AND DRY DOCK COMPANY, ET AL. PETITION FOR A WRIT OF CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT The Solicitor General, on behalf of the Director of the Office of Workers' Compensation Programs in the Department of Labor, respectfully petitions for a writ of certiorari to review the judgment of the United States Court of Appeals for the Fourth Circuit in this case. OPINIONS BELOW The opinion of the court of appeals (App., infra, la-24a) is reported at 8 F.3d 175. The decision of the Benefits Review Board (App., infra, 27a-36a) is un- reported. The decision of the administrative law judge (App., infra, 37a-62a) is reported at 23 Ben. Rev. Bd. Serv. 515. (1) ---------------------------------------- Page Break ---------------------------------------- 2 JURISDICTION The court of appeals entered its judgment on October 29, 1993, and denied a petition for rehearing on January 7, 1994. App., infra, 25a-26a. On March 28, 1994, the Chief Justice extended the time within which to file a petition for a writ of certiorari to and including May 7, 1994. The jurisdiction of this Court is invoked under 28 U.S.C. 1254(1). STATUTORY AND REGULATORY PROVISIONS INVOLVED Pertinent provisions of the Longshore and Harbor Workers' Compensation Act (33 U.S.C. 921(b), 921(c), 921 (d), 921 a, 939(a), 939(c)) are reprinted at App., infra, 63a-66a. Pertinent provisions of the Department of Labor's regulations (20 C.F.R. 701.201,701.202,702.333, 801.102, 802.4 10) are reprinted at App., infra, 67a-68a. STATEMENT This case concerns the standing of the Director of the Office of Workers' Compensation Programs in the Department of Labor to petition the court of appeals to review a decision of the Benefits Review Board under the Longshore and Harbor Workers' Compensation Act (LHWCA), 33 U.S.C. 901 et seq. 1. The LHWCA creates a comprehensive federal scheme to compensate workers injured or killed while em- ployed upon the navigable waters of the United States. Congress directed the Secretary of Labor to "administer the provisions" of the Act and authorized him to issue "rules and regulations" necessary to the Act's administra- tion. 33 U.S.C. 939(a), Congress also specifically provided that the Secretary shall actively supervise the medical care rendered to injured employees, 33 U.S. C. 907; approve ---------------------------------------- Page Break ---------------------------------------- 3 settlements, 33 U.S. C. 908(i); appear before courts of ap- peals through attorneys appointed to represent him, 33 U.S.C. 921a; bring actions in district court to enforce compensation awards, 33 U.S.C. 921(d); furnish informa- tion to claimants, assist them in obtaining medical and rehabilitate ion services, and, upon request, provide legal assistance in processing a claim, 33 U.S.C. 939(c); ad- minister a Special Fund for payment of benefits in speci- fied circumstances, 33 U.S.C. 944; and issue and enforce rules and regulations pertaining to employee safety, 33 U.S.C. 941. The Secretary has delegated most of his re- sponsibilities under the LHWCA to the Director of the Of- fice of Workers' Compensation Programs (Director). 20 C.F.R. 701.201, 701.202; see 55 Fed. Reg. 9033 (1990) (Secretary of Labor's delegation of some safety and health responsibilities to Assistant Secretary for Occupational Safety and Health). Workers seeking compensation under the Act must file a claim with one of the local district directors (referred to in the LHWCA as "deputy commissioners") in the Office of Workers' Compensation Programs (OWCP), who carry out the day-to-day administration of the Act. 33 U.S.C. 913(a), 939(a) and (b); 20 C.F.R. 701.201-701.203, 701.301 (a)(7). The district director conducts such investi- gation of the claim as he deems necessary and, if able to resolve the claim informally, is authorized to issue a com- pensation order; if he is unable to resolve the claim infor- mally, it is forwarded for hearing to an administrative law judge (ALJ), who is then empowered to issue a compensa- tion order. 33 U.S.C. 919(c), (d) and (e); 20 C.F.R. 702.301-702.317, 702.348-702.349. Implementing regula- tions provide that the claimant and the employer (or its in- surance carrier) are necessary parties for a hearing, 20 C.F.R. 702.333(a), and that the Solicitor of Labor, or his ---------------------------------------- Page Break ---------------------------------------- 4 designee may participate on behalf of the Director, as an "interested party. " 20 C.F.R. 702.333(b). An ALJ's decision is reviewable by the Benefits Review Board (Board) whose members are appointed by the Secre- tary. 33 U.S.C. 92 l(b)(l). The Board reviews the ALJ's decision to determine if it is supported by substantial evi- dence and is in accordance with law. 33 U.S.C. 921(b)(3); 20 C.F.R. 801. 102; see generally Kalaris v. Donovan, 697 F.2d 376, 382 (D.C. Cir.), cert. denied, 462 U.S. 1119 (1983). Any "party in interest" may file an appeal from the ALJ to the Board. 33 U.S.C. 921(b)(3). The term "party in interest" is defined by regulation to mean "the Secretary or his designee and any person or business entity directly af- fected by the decision or order from which an appeal to the Board is taken." 20 C.F.R. 801.2(a)(10); see also 20 C.F. R. 802.201(a)(l). The Board's decision is reviewable by the court of ap- peals. Under Section 21(c) of the LHWCA, any "person adversely affected or aggrieved" may petition the court of appeals for such judicial review. 33 U.S.C. 921(c). The Secretary's regulations provide that the Director, as the designee of the Secretary "responsible for the administra- tion and enforcement" of the Act, "shall be deemed to be the proper party on behalf of the Secretary of Labor in all review proceedings conducted pursuant to section 21(c) of the LHWCA [33 U.S.C. 921(c), i.e., in the court of ap- peals]." 20 C.F.R. 802.410(b).1 ___________________(footnotes) 1 The procedures for adjudication of claims reflect substantial modifications made by the 1972 amendments to the LHWCA. See Pub. L. No. 92-576,86 Stat. 1251. Before those amendments, OWCP deputy commissioners conducted hearings and issued compensation orders in disputed cases. Those decisions were reviewable in an injunc- tive action against the deputy commissioner in district court, subject to further review by appeal to the court of appeals under 28 U.S.C. 1291. See Kalaris, 697 F.2d at 381-382. The 1972 amendments trans- ---------------------------------------- Page Break ---------------------------------------- 5 2. Jackie Harcum, an employee of Newport News Shipbuilding and Dry Dock Co. (Newport News), suffered a work-related, disabling back injury and filed a claim for benefits under the LHWCA. App., infra, 2a. The claim was referred to an ALJ to resolve several disputed issues, including whether claimant Harcum was entitled to benefits for temporary total disability (not merely partial disability) from the date that he stopped work at the shipyard (May 6, 1988) until the date he found alternative employment (February 16, 1989). Id. at 6a, 39a.2 ___________________(footnotes) ferred the deputy commissioners' hearing authority to ALJs and replaced the district court injunctive proceedings with appeals to the Board, whose decisions are subject to review by the court of appeals under 33 U.S.C. 921(c). Under the new regime, "[t]he Board * * * performs a review function identical to that which the [d]istrict [c]ourts performed" before the 1972 amendments. Kalaris, 697 F.2d at 382. As a purely adjudicatory body, the Board, like a district court, does not participate as a party in appeals from its decisions. See 42 Fed. Reg. 16,133 (1977) (notice accompanying promulgation of 20 C.F.R. 802.410 stating that "[a]s a quasi-judicial body the Board does not participate in any court proceedings challenging the validity of its decisions"). 2 Newport News also asserted that the claimant suffered from a pre- existing permanent partial disability that contributed to his current disability, and that Newport News was entitled to a reduction in the amount of benefits it was required to pay because the Special Fund ad- ministered by the Secretary should assume payment for part of the benefits under Section 8(f) of the Act. App., infra, 7a. See 33 U.S.C. 908(f) (Special Fund assumes liability for compensation payment for injury after 104 weeks of permanent disability if claimant had pre- existing permanent partial disability that combined with his compen- sable injury to render him more disabled than he would have been from the injury alone); 33 U.S.C. 944(a). The ALJ and the Board agreed with Newport News that Section 8(f) applied to this case. App., infra, 7a, 33a-36a, 59a-61a. The court of appeals, however, rejected both parties' interpretations of Section 8(f), reversed the Board's rul- ing and remanded the" case for further proceedings. App., infra, 14a-24a. Newport News filed a petition for rehearing and suggestion ---------------------------------------- Page Break ---------------------------------------- 6 The ALJ applied the rationale of the Board's decision in Stevens v. Lockheed Shipbuilding Co., 22 Ben. Rev. Bd. Serv. (MB) 155 (1989) (total disability becomes partial when claimant regains residual wage-earning capacity and it relates back to date of maximum medical improvement). The ALJ reasoned that the claimant was entitled only to permanent partial (rather than temporary total) disability benefits as of May 6, 1988, because that was the date he left employment at Newport News and because the date of his maximum medical improvement had already passed. App., infra, 6a, 56a-57a. The ALJ held that the claimant regained residual wage-earning capacity as of May 6, 1988, and that he therefore should have received compen- sation after that date based only on a permanent partial disability. Id. at 57a. The Director appealed the ALJ's ruling to the Board as a "party in interest," pursuant to 33 U.S.C. 921(b)(3). App., infra, 7a. The Director contended that the claimant was entitled to benefits based on permanent total disability until February 16, 1989, when he secured other employ- ment. The claimant responded in support of the Director's argument and Newport News responded in support of af- firmance. Id. at 29a. The Board affirmed the ALJ's ruling, although it clari- fied the underlying rationale. The Board vacated the ALJ's reliance on its Stevens decision because the decision had subsequently been reversed on judicial review. App., infra, 29a-31a; Stevens v. Director, OWCP, 909 F.2d 1256 (9th Cir. 1990), cert. denied, 498 U.S. 1073 (1991). The Board affirmed, however, on the alternative rationale that ___________________(footnotes) of rehearing en bane on the Section 8(f) issue, which the court of ap- peals denied. App., infra, 25a-26a. Although the Director disagrees with the court's Section 8(f) ruling, she does not believe that review of that issue by this Court is warranted. ---------------------------------------- Page Break ---------------------------------------- 7 Newport News' uncontradicted evidence showed that there was suitable alternate employment for the claimant as of May 1988, and that the claimant had not shown that he was unable to obtain such employment. App., infra, 31a-33a. The Board also ruled that a statement by New- port News to the claimant that it would determine whether it had a light-duty position available for him, and its sub- sequent hiring of a vocational consultant to assist the claimant in securing alternate employment, did not affect that finding, because Newport News was not under any obligation to rehire claimant or to find him an actual job offer. Id. at 32a-33a. The Board therefore concluded that the claimant was only partially disabled as of May 1988. 3. The Director filed a petition in the court of appeals for review of the Board's decision pursuant to 33 U.S.C. 921 (c). The claimant did not file a petition for review. In response to an inquiry from the court of appeals (follow- ing the Director's motion to amend the case caption and Newport News' statement that it did not object), the claim- ant stated that he had not appealed, but that the Director could pursue the case as she chose. See Attachments A and B to Respondent's Answer to Petitioner's Petition for Rehearing. The court of appeals granted the Director's motion and amended the caption to show Harcum as a claimant in the proceedings below. The Director challenged the Board's holding as to suit- able alternative employment, contending that the Board usurped the ALJ's fact-finding role. The Director also contended that, even if the employer made a showing of suitable alternative employment, the claimant had legiti- mately relied on the employer's vocational rehabilitation program, rather than independently seeking work, during the period in question. Thus, the Director argued that the Board's decision erroneously denied total disability bene- ---------------------------------------- Page Break ---------------------------------------- 8 fits for the period between May 1988 and February 1989. App., infra, 2a. Although the issue of standing was not raised or briefed by the parties, the court of appeals held that the Director did not have standing to petition for review of the Board's ruling as to the onset date of claimant's partial disability. App., infra, 9a n.1, 13a-14a. The LHWCA provides in relevant part that "[a]ny person adversely affected or ag- grieved by a final order of the Board may obtain a review of that order" in the court of appeals. 33 U.S.C. 921(c). The court concluded that 33 U.S. C. 921(c) "codifies the constitutional requirement that limits standing to those persons who can allege `that they personally have suffered or imminently will suffer an injury.' " App., infra, 9a n. 1 (quoting E. Chemerinsky, Federal Jurisdiction 2.3.2, at 52 (1989)). In the court's view, the Director suffers such an injury only when a Board decision "alter[s] the Director's ability to carry out his or her responsibilities under the LHWCA or to protect the fiscal integrity of the special fund." App., infra, 14a. In holding that the Director lacks standing, the court of appeals relied upon Director, OWCP v. Donzi Marine, Inc., 586 F.2d 377 (5th Cir. 1978). App., infra, 10a-12a. The court explained that in Donzi Marine, the Fifth Cir- cuit held that the Director "would have standing only if an interest of the Director arising from his or her specifically delegated responsibilities was adversely affected by the Board's decision." App., infra, 10a. The court below indi- cated that, under the Donzi Marine rationale, the Director "may redress Board decisions that adversely affect the Director's legitimate administrative interests. * * * For example, if a Board decision substantially augmented the nature of the administrative duties delegated to the Direc- tor, increased the Director's necessary expenditure of ad- ministrative resources, or created confusion as to how the ---------------------------------------- Page Break ---------------------------------------- 9 Director was to carry out specific functions, the Director's responsibilities under the LHWCA would be bound up suf- ficiently with the merits of the appeal to evidence a cogniz- able administrative injury." App., infra, 1 la, citing Donzi Marine, 586 F.2d at 381-382. The court of appeals noted that it had adopted the logic of Donzi Marine in Director, OWCP v. Newport News Shipbuilding & Dry Dock Co. (Langley), 676 F.2d 110 (4th Cir. 1982), where it had questioned whether "the Board's decision sufficiently implicated an administrative or eco- nomic interest of the Director so as to give rise to a redress- able injury. " App., infra, 13a. The court treated its decision in Langley as holding that the Director had standing because of his interest in protecting the fiscal integrity of the Special Fund. App., infra, 13a, citing 676 F.2d at 114.3 Applying the foregoing analysis to this case, the court concluded that the Director had standing to seek review of the portions of the Board's decision that would result in in- creased payments from the Special Fund administered by the Director (see note 2, supra), but did not have standing to appeal the issue of the onset date of the claimant's partial disability. The court reasoned that although the Director contended that the Board misapprehended the LHWCA'S requirements, the Board's conclusion as to when claimant's disability became partial neither altered the Director's abili- ty to carry out her responsibilities under the LHWCA nor affected the fiscal integrity of the Special Fund. App., in- fra, 13a-14a.4 ___________________(footnotes) 3 The court below also noted its own prior holding that the Director is not a proper respondent to a petition for review under 33 U.S.C. 921 (c). App., infra, 12a n.2 (citing I. T.O. Corp. v. Benefits Review Bd., 563 F.2d 646, 648 (4th Cir. 1977) (en bane)), discussed at note 6, infra. 4 The court denied the Director's petition for rehearing and sugges- tion of rehearing en bane on the standing issue. Two judges voted to rehear the case en bane. App., infra, 25a-26a. ---------------------------------------- Page Break ---------------------------------------- 10 REASONS FOR GRANTING THE PETITION The court of appeals erred in holding that the Director does not have standing to petition the court of appeals for review of a ruling by the Benefits Review Board unless the Director has a pecuniary interest or the Board's ruling will disrupt the Director's performance of specific administra- tive functions. The court of appeals failed to recognize that the Director is "aggrieved or adversely affected" by the Board's ruling in the instant case, and thus has stand- ing to appeal, due to the interests created by Congress in the Secretary and the Director in their broad authority to administer the LHWCA and to participate in the claims adjudication process. This Court specifically noted, but left unresolved, the issue of the Director's standing in Director, OWCP v. Perini N. River Assocs., 459 U.S. 297, 302-305 (1983), and that issue continues to divide the courts of appeals. Review by this Court therefore is war- ranted. 1. Although the decision below is in accord with deci- sions of the Second Circuit and Fifth Circuit, 5 it conflicts with decisions of the D.C. Circuit. In Director, OWCP v. National Van Lines, Inc., 613 F.2d 972 (1979), cert. denied, 448 U.S. 907 (1980), the D.C. Circuit held that the Director "has standing as a petitioner in this proceeding ___________________(footnotes) 5 See Fusco v. Perini N. River Assocs., 601 F.2d 659 (2d Cir. 1979), vacated and remanded on other grounds, 444 U.S. 1028, reinstated on remand, 622 F.2d 1111, 1113 (2d Cir. 1980), cert. denied, 449 U.S. 1131 (1981); Donzi Marine, Inc., 586 F.2d at 382. Fusco and Donzi Marine hold that the Director lacks statutory standing under 33 U.S.C. 921 (c) to appeal Board orders denying compensation claims. Fusco, 601 F.2d at 670, 622 F.2d at 1113; Donzi Marine, 586 F.2d at 382. Neither Fusco nor Donzi Marine addressed whether the Director would have standing under Article III if she was statutorily authorized to seek review. Fusco, 601 F.2d at 670; Donzi Marine, 586 F.2d at 378 n.2. ---------------------------------------- Page Break ---------------------------------------- 11 both because of his official responsibility for administra- tion of the LHWCA and because of his financial interest as administrator of the special fund." 613 F.2d at 977 n.6. The D.C. Circuit reinforced that ruling in Shahady v. Atlas Tile & Marble Co., 673 F.2d 479 (1982), where it ex- plained that it had "previously held that the Director's general supervisory and enforcement interest, apart from any pecuniary interest, is sufficient to convey upon the Director standing to file a petition for review under section 921(c)." 673 F.2d at 483.6 The Fourth Circuit in Langley ___________________(footnotes) 6 Shahady specifically involved the question whether the Director is a proper respondent in proceedings before the court of appeals. The D.C. Circuit held that "[b]ecause the statutory scheme of the LHWCA and regulations promulgated thereunder clearly contemplate that the Secretary or his delegate shall participate as a matter of course in sec- tion 921 (c) review proceedings, we hold the Director should be named a party-respondent in all review proceedings brought under section 921(c), whether or not the Director supports the Board's order." 673 F.2d at 480. Other courts of appeals have agreed with Shahady that the Director is a proper respondent under the Act. See Goldsmith v. Director, OWCP, 838 F.2d 1079, 1080 (9th Cir. 1988); Thornton v. Brown & Root, Inc., 707 F.2d 149, 154 (5th Cir. 1983), cert. denied, 464 U.S. 1052 (1984); Ingalls Shipbuilding Div., Etc. v. White, 681 F.2d 275, 286-287 (5th Cir. 1982), overruled on other grounds by Newpark Shipbuilding & Repair, Inc. v. Roundtree, 723 F.2d 399 (5th Cir.) (en bane), cert. denied, 469 U.S. 818 (1984); see also Curtis v. Schlumberger Offshore Serv., Inc., 849 F.2d 805, 807 n.4 (3d Cir. 1988). But see I. T. O. Corp. v. Benefits Review Bd., 563 F.2d 646,648 (4th Cir. 1977) (en bane), reinstating in pertinent part, 542 F.2d 903 (4th Cir. 1976) (en bane), vacated and remanded, 433 U.S. 904 (1977) (Director limited to intervention under Fed. R. Civ. P. 24). Some of the decisions upholding the Director's status as respondent are based on 33 U.S.C. 921(c) and some are based solely on Fed. R. App. P. 15(a), which provides that petitions for review of administrative agen- cy orders must name the agency as a respondent. Brown & Root, Inc., 707 F.2d at 154; Ingalls Shipbuilding, 681 F.2d at 282-284. ---------------------------------------- Page Break ---------------------------------------- 12 understood National Van Lines as holding that the Direc- tor "has standing to appeal because of his general admini- strative responsibility and his financial interest in the special fund. " 676 F.2d at 113. And in the instant case, the Fourth Circuit specifically recognized that its ruling is in- consistent with Shahady. See App., infra, 12a. 7 The Third Circuit has indicated its approval of Shahady, as "sound on policy because the Director's supervisory and enforcement interest should be sufficient to entitle him to participate as a party; his responsibility to oversee the development of a consistent body of law in this area should not depend upon the vagaries of the parties' private, albeit adversary, interests ." Curtis v. Schlum- berger Offshore Serv., Inc., 849 F.2d 805, 807 n.4 (1988). The Third Circuit did not decide the issue in Curtis be- cause the employer and employee were both parties before that court. In an earlier case under the Black Lung Bene- fits Act which incorporates the same judicial review proc- ess as under the LHWCA, however, the Third Circuit noted that the Director had standing to petition the court of appeals for review of a Board ruling even though the Director lacked a pecuniary interest in the litigation. The court explained that it concurred "in the Director's view ___________________(footnotes) 7 Although Shahady presented the question of whether the Director may appear as respondent when a private party has petitioned for review of a Benefits Review Board decision, its holding that the Direc- tor is an automatic respondent in review proceedings is based not on Fed. R. App. P. 15(a), but rather on National Van Lines, which held that the Director has standing as a petitioner and which Shahady inter- preted as holding that the Director's general interest in enforcement of the LHWCA is an independent basis for standing. 673 F.2d at 483. Thus, Shahady clearly establishes in the D.C. Circuit that the Direc- tor, based on her status as administrator of the Act, may appear as petitioner or respondent in proceedings under 33 U.S. C. 921(c). See Kalaris v. Donovan, 697 F.2d 376, 381 n.8 (D.C.Cir.), cert. denied, 462 U.S. 1119 (1983). ---------------------------------------- Page Break ---------------------------------------- 13 that he has standing because of his responsibility to ensure the proper enforcement and lawful administration of the black lung benefits program ." Director, OWCP V. Rochester & Pittsburgh Coal Co., 678 F.2d 17, 18-19 n.2 (3d Cir. 1982); see also Director, OWCP v. O'Keefe, 545 F.2d 337, 339 & n.7 (3d Cir. 1976) (assuming Director has authority under 33 U.S.C. 921(c) to petition court of ap- peals for review of Board decision). Significantly, moreover, the Fifth Circuit itself appears to have retreated from the standard it set forth in Donzi Marine, on which the court below relied. In Director, OWCP v. Bethlehem Steel Corp., 949 F.2d 185, 186-187 (1991), the Fifth Circuit held that the Director has statutory standing to challenge a Board ruling as to when a total disability becomes a partial disability - an issue that is, for present purposes, analytically indistinguishable from the one the Fourth Circuit held that the Director did not have standing to raise in this case. The Fifth Circuit reasoned that the Director was "faced by the ruling of three Courts of Appeals that the Board of Review is simply wrong," which "poses a major problem in the administration of an Act which was conceived out of the * * * constitutional de- mand for a nationwide uniformity." Id. at 187. The court pointed out that if the Director did not have standing to seek relief from the Board's ruling, "injured workers in the extensive maritime activities in the Fifth Circuit must en- dure a ruling fraught with substantial dollar loss."" Ibid. 8 Thus, the Fifth Circuit standard appears to permit the court to substitute its judgment for the Director's judgment as to the impact that a Board decision has on the administration of the LHWCA, thereby leading to great unpredictability. ___________________(footnotes) 8 The Fifth Circuit also noted that although the claimant had not filed his own petition for review of the Board's decision, the claimant had entered a formal appearance in the case and had adopted the Direc- tor's briefs and argument. 949 F.2d at 186. ---------------------------------------- Page Break ---------------------------------------- 14 In Director, OWCP v. Perini N. River Assocs., 459 U.S. 297, 302-305 (1983), this Court took note of the ques- tion whether the Director has statutory and Article III standing to file a petition for a writ of certiorari. The Court found it unnecessary to decide the question, how- ever, because the employer in Perini conceded that the Direct or was a proper respondent before the court of ap- peals and, as such, was entitled to petition for a writ of certiorari under 28 U.S. C. 1254(1). 459 U.S. at 304. More- over, the claimant in Perini participated before this Court and filed briefs in support of the Director thereby ensuring that the Court was presented with an admittedly justifi- able controversy. Id. at 304-305. The Court noted that in some earlier cases, the Director had petitioned for writs of " certiorari that were granted by the Court, but because of the procedural posture, resolution of the standing issue had been unnecessary in those cases as well. Id. at 303 n. 11.9 The Court should now resolve the standing issue that it has left open and that continues to divide the lower courts. 2. a. The panel's holding that the Director does not have standing to petition the court of appeals for review of the Board's ruling on the partial disability issue is incor- rect. There is an ongoing dispute in this case as to the proper amount of benefits that the claimant should be ___________________(footnotes) 9 The Court also pointed out that the courts of appeals that had re- jected the Director's standing argument in Fusco, Donzi Marine, and I. T. O. Corp., had relied on statutory grounds and did not address the Article 111 standing issue. 459 U.S. at 302 n.9. The Court concluded in the Perini case that "the Director has statutory authority to seek review in this Court," but that the Director "may not have Art. 111 standing to argue the merits of [claimant's] claim because the Director's presence does not guarantee the existence of a justifiable controversy with respect to the merits of [claimant's] coverage under the LHWCA." 459 U.S. at 304. ---------------------------------------- Page Break ---------------------------------------- 15 awarded. And "where a dispute is otherwise justifiable, the question whether the litigant is a `proper party to re- quest an adjudication of a particular issue,' * * * is one within the power of Congress to determine. " Sierra Club v. Morton, 405 U.S. 727, 732 n.3 (1972) (quoting Flast v. Cohen, 392 U.S. 83, 100 (1968)). Congress thus may determine whether an interest is "legally-protected," see Lujan v. Defenders of Wildlife, 112 S. Ct. 2130, 2136 (1992), such that an invasion of that interest results in an "injury in fact" for standing purposes. In this case, Congress has vested the Secretary of Labor with authority to promulgate regulations to aid in his ad- ministration of the LHWCA (33 U.S. C. 939(a)); those regulations grant the Director standing to participate at all levels, administrative and judicial, of a LHWCA dispute. Shahady, 673 F.2d at 483. The regulations specifically provide that the Director, as the designated official "re- sponsible for the administration and enforcement" of the Act, "shall be deemed to be the proper party on behalf of the Secretary of Labor in all review proceedings" in the courts of appeals. 20 C.F.R. 802.410(b).1'J In holding that the Director nevertheless lacks Article 111 standing, the court of appeals failed to recognize the extensive duties conferred on the Director (through the Secretary) by Congress and the attendant interests the Secretary and Director are entitled to advance. As noted above, Congress has vested the Secretary of Labor with the following duties: "administer[ing] the provisions" of the Act and issuing necessary "rules and regulations," 33 U.S.C. 939(a); actively supervising the medical care ___________________(footnotes) 10 The regulations also make clear that the Director has standing to participate in administrative proceedings, including by appealing to the Board from an ALJ decision with which she disagrees. 20 C.F. R. 702.333(b), 801.2(a)(10), 802.201(a)(l). ---------------------------------------- Page Break ---------------------------------------- l6 rendered to injured employees, including maintaining a list of health care providers not authorized to render serv- ices under the LHWCA and regulating the medical ex- penses, 33 U.S.C. 907; approving settlements, 33 U.S.C. 908(i); appearing before courts of appeals through at- torneys appointed to represent him, 33 U.S.C. 921a; bringing actions (through deputy commissioners) in district court to enforce compensation awards, 33 U.S.C. 921 (d); furnishing information to claimants, assisting them in obtaining medical and rehabilitation services, and, upon request, providing them with legal assistance in proc- essing a claim, 33 U.S. C. 939(c); administering a Special Fund for payment of benefits in specified circumstances, 33 U.S.C. 944; and issuing and enforcing rules and regula- tions pertaining to employee safety, 33 U.S.C. 941. In sum, the Secretary is charged with ensuring that employers fulfill their statutory responsibility to pay valid claims (thereby relieving the claimant and the public at large of that cost), assisting claimants in both administra- tive hearings and the courts, and defending the special fund against invalid claims. Cf. Director, OWCP v. Eastern Coal Corp., 561 F.2d 632,641-648 (6th Cir. 1977) (discussing Secretary's analogous duties under Black Lung Benefits Act). The Secretary's role in ensuring payment by employers and assisting claimants not only serves the in- terest in "meeting the needs of the injured employee and his family," but also "by assuring that the employer bears the cost of unsafe conditions, serves to strengthen the employer's incentive to provide the fullest measure of on- the-job safety." H.R. Rep. No. 1441, 92d Cong., 2d Sess. 1 (1972). This statutory assignment of authority to the Secretary and, by delegation, to the Director, gives the Director standing to petition for review of Board decisions that she believes are erroneous. ---------------------------------------- Page Break ---------------------------------------- 17 b. The history of the LHWCA strongly supports the conclusion that the Director is "adversely affected or ag- grieved" by Board orders that incorrectly reject a claim for benefits under the Act. Prior to the 1972 Amendments to the Act (see note 1, supra), the deputy commissioners (field administrators under the authority of the Director's predecessor) conducted hearings on claims, and their deci- sions were subject to review in injunctive proceedings in district court. The deputy commissioner was denominated as a respondent in such district court proceedings, see former Section 21(b), 44 Stat. 1436 (1927) (codified at 33 U.S.C. 921(b) (1970)), and it was clear that the deputy commissioner had standing to appeal under 28 U.S.C. 1291 from a district court ruling enjoining his decision, even in the absence of an appeal by another party. See Henderson v. Glens Falls Indem. Co., 134 F.2d 320 (5th Cir.), cert. denied, 319 U.S. 756 (1943). The 1972 Amendments transferred the authority to con- duct hearings to ALJs and replaced district court injunc- tive actions with review by the Board, subject to review in the court of appeals. There is no indication, however, that those changes were intended to divest the LHWCA'S ad- ministrator of authority to seek review in the courts of ap- peals of decisions on benefits claims that are adverse to her position. Cf. Director, OWCP v. Eastern Coal Corp., 561 F.2d 632, 649 (6th Cir. 1977) ("[w]e do not find in the [1972 Amendments] any Congressional intention * * * to compel the Secretary or his duly designated representative to accept [Board decisions] without recourse to the courts when he conscientiously disagrees"); Shahady, 673 F.2d at 485. Indeed, such a restrictive interpretation of 33 U.S.C. 921 (c) would thwart the Director's policymaking, admini- strative and protective roles under the LHWCA, and would be directly at odds with a major purpose of the 1972 ---------------------------------------- Page Break ---------------------------------------- 18 Amendments, which was to augment these roles. See S. Rep. No. 1125, Cong., 2d Sess. 13-14 (1972) (placing responsibility for hearings with ALJs will better enable deputy commissioners to perform their administrative responsibilities under the Act); see generally id. at 14-15 (ensuring Director's active involvement at all stages of claim-processing under LHWCA); H.R. Rep. No. 1441, 92d Cong., 2d Sess. 12-13 (1972) (same). That the Director's interest in the resolution of benefit claims is sufficient to confer standing is confirmed by the text and legislative history of the Black Lung Benefits Act, as amended in 1977, Pub. L. No. 95-239, 92 Stat. 95 (BLBA). The BLBA generally incorporates the procedures of the LHWCA, 30 U.S. C. 932(a), and explicitly provides that "[t]he Secretary shall be a party in any proceeding relative to a claim" for black lung benefits. 30 U.S.C. 932(k). The Senate Committee on Human Resources (the successor to the Committee on Labor and Public Welfare that drafted the 1972 amendments to the LHWCA) ex- plained that this provision reflects the intent that the Director have standing under both Acts: Some question has arisen as to whether the adjudica- tion procedures applicable to black lung claims incor- porating various sections of the amended Longshore- men's and Harbor Workers' Compensation Act con- fers standing upon the Secretary of Labor or his designee to appear, present evidence, file appeals or respond to appeals filed with respect to the litigation and appeal of claims. In establishing the Longshore Act procedures it was the intent of this Committee to afford the Secretary the right to advance his views in the formal claims litigation context whether or not the Secretary had a direct financial interest in the out- come of the case. The Secretary's interest as the of- ficer charged with the responsibility for carrying forth ---------------------------------------- Page Break ---------------------------------------- 19 the intent of Congress with respect to the Act should be deemed sufficient to confer standing on the Secre- tary or such designee of the Secretary who has the re- sponsibility y for the enforcement of the Act, to active- ly participate in the adjudication of claims before the Administrative Law Judge, Benefits Review Board, and appropriate United States Courts. S. Rep. No. 209, 95th Cong., 1st Sess. 21-22 (1977) (em- phases added). "When several acts of Congress are passed touching the same subject-matter, subsequent legislation may be considered to assist in the interpretation of prior legislation upon the same subject ." Tiger v. Western In- vestment Co., 221 U.S. 286, 309 (191 1); Bell v. New Jersey, 461 U.S. 773, 784 (1983). See also West Virginia Univ. Hospitals, Inc. v. Casey, 499 U.S. 83, 100-101 (1991). That is especially so here. Congress specifically in- tended that the procedures for administrative and judicial review under the LHWCA and BLBA be the same. To recognize the Director's standing under one Act but not the other would be inconsistent with that intent and would introduce unwarranted complexity into the implementa- tion of the statutory mandates. 11 ___________________(footnotes) 11 The Director, OWCP, administers both the LHWCA and the BLBA. 20 C.F. R. 701 .202(a) and (f). As set forth above, a specific provision of the BLBA (30 U.S.C. 932(k)), as well as its legislative history establish that Congress intended to permit the Director to seek review of Board decisions on BLBA claims, even in the absence of a financial interest in the outcome. Nonetheless, the lower court's con- stitutional ruling could have implications for the BLBA, which incor- porates 33 U.S.C. 921(c) from the LHWCA. Although several courts of appeals, even before the addition of 30 U.S.C. 932(k), recognized the Director's standing to petition for review of Board decisions on black lung claims, the courts gave at least some weight to the Director's interest in those cases in obtaining reimbursement from mine operators for benefits paid from the Black Lung Disability Trust Fund. See Krolick Contracting Corp. v. Benefits Review Bd., 558 F.2d 685, 689-690 (3d Cir. 1977); Director, OWCP v. National Mines Corp., 554 F.2d 1267, 1271-1272 (4th Cir. 1977); Director, OWCP v. ---------------------------------------- Page Break ---------------------------------------- 20 c. The court of appeals correctly viewed 33 U.S.C. 921 (c) in this context as authorizing standing as broadly as is permitted by Article III of the Constitution. App., in- fra, 9a n. 1; see Trafficante v. Metropolitan Life Ins. Co., 409 U.S. 205, 209 (1972). In concluding that the Director lacks the "injury in fact" required for constitutional stand- ing, however, the court of appeals confused the Director's interest in the resolution of LHWCA cases with the inter- ests of private parties, whose standing to litigate the merits of a particular case depends upon an economic or other personal stake in the outcome of a controversy. See Baker v. Carr, 369 U.S. 186, 204-208 (1962). "[T] he Director in this litigation is no private party required to show `that he has suffered injury in fact' * * * [;] [t]he question in this case is whether or not the interest of the Department of Labor of the United States Government has been adverse- ly affected or aggrieved." Eastern Coal Corp., 561 F.2d at 646. Because the Director appears "not as a private indi- vidual in any sense, but as the authorized representative of the Department of Labor" who is entrusted with responsi- bility for the administration of the LHWCA, ibid., her in- terest is analogous not to that of private parties, but rather to that of other government officials carrying out their public duties under particular statutes. See, e.g., United ___________________(footnotes) Alabama By-Products Corp., 560 F.2d 710, 717 (5th Cir. 1977); Eastern Coal Corp., 561 F.2d at 646; Director, OWCP v. Peabody Coal Co., 554 F.2d 310, 336-338 (7th Cir. 1977); see Donzi Marine, 586 F.2d at 380 (distinguishing black lung cases on ground that, unlike LHWCA case before the court, government had an interest in estab- lishing its right to recover funds already disbursed). The Director may also, however, wish to petition for review of Board decisions in some BLBA cases in which the Director did not initially find eligibility on behalf of the claimant and interim benefits therefore have not been paid out of the Black Lung Disability Trust Fund. In those cases, government would not have a pecuniary interest in the case. ---------------------------------------- Page Break ---------------------------------------- 21 States ex rel. Chapman v. Federal Power Comm`n, 345 U.S. 153, 155-156 (1953); In re Debs, 158 U.S. 564, 584-586 (1895); cf. Alfred L. Snapp & Son, Inc. v. Puerto Rico, 458 U.S. 592, 607 (1982) (State has parens patriae standing based on the health and well being of its residents in general). The benefits scheme established by the LHWCA does far more than provide for adjudication and vindication of purely private rights. As a workers' compensation system, it has many of the elements of social insurance, and as such is designed to promote the public interest: [T]he entire [workers'] compensation system has been set up and paid for, not by the parties, but by the public. The public has ultimately borne the cost of compensation protection in the price of the product, and it has done so for the specific purpose of avoiding having the disabled victims of industry thrown on private charity or public relief. * * * . 3 A, Larson, The Law of Workmen's Compensation $82.41 (1993); 1 id. 1.20 ("like social insurance, but unlike tort, the right to benefits and amount of benefits are based largely on a social theory of providing support and preventing destitution, rather than settling accounts between two individuals according to their personal deserts or blame"); see Northeast Marine Terminal Co. v. Caputo, 432 U.S. 249,268 (1977) (LHWCA, as amended, is remedial legislation that "must be liberally construed in conformance with its purpose, and in a way which avoids harsh and incongruous results," quoting Voris v. Eikel, 346 U.S. 328, 333 (1953)). The United States has an in- terest in ensuring that claimants receive the maximum benefits to which they are entitled under such protective legislation. See H.R. Rep. No. 1441, 92d Cong., 2d Sess. 12-13 (1972); S. Rep. No. 1125, 92d Cong., 2d Sess. 15 ---------------------------------------- Page Break ---------------------------------------- 22 (1972). It may advance that interest through its agent, the Director, in the courts of the United States. Compare, e.g., Heckman v. United States, 224 U.S. 413, 437-444 (19 12); Moe v. Confederated Salish & Kootenai Tribes, 425 U.S. 463, 473-474 (1976).12 Given her broad responsibilities and the public interest inhering in them, the Director has a material interest in the administration and application of the LHWCA beyond the narrow range that the court of appeals grudgingly acknowledged. The Director's interest, on behalf of the United States, is engaged every time she concludes that the Board has improperly denied a particular claim. Shahady, 673 F.2d at 483; cf. Eastern Coal Corp., 561 F.2d at 645 (Director is "adversely affected or aggrieved" under 33 U.S.C. 921(c) "in that * * * he is seeking what he deems to be lawful administration of the [BLBA] and assisting ___________________(footnotes) 12 Cf. General Tel. Co. v. EEOC, 446 U.S. 318, 326 (1980) (when EEOC acts under Title VII of the Civil Rights Act of 1964, albeit at the behest of and for the benefit of specific individuals, it acts also to vindicate the public interest in preventing employment discrimina- tion); Secretary of Labor v. Fitzsimmons, 805 F.2d 682, 692-693 (7th Cir. 1986) (en bane) (Secretary's interest in bringing enforcement ac- tion under Employee Retirement Income Security Act is based not only on his duty to protect individual beneficiaries of specific pension programs, but also on the public interest in protecting "the very in- tegrity, heart and lifeline of the program itself."); Donovan v. Univer- sity of `Tex. at El Paso, 643 F.2d 1201, 1208 (5th Cir. 1981) (Secretary sues to protect the public interest under Fair Labor Standards Act); United States v. Federal Maritime Comm'n, 694 F.2d 793, 800-802 (D.C. Cir. 1982) (Federal Maritime Commission's order approving rate agreement between shippers interfered with Justice Department's responsibility to enforce antitrust laws, and that injury established that Justice Department was "party aggrieved" entitled to assert public interest under Shipping Act and seek judicial review of Commission order); United States v. Federal Maritime Comm`n, 655 F.2d 247, 251-252 (D.C. Cir. 1980). ---------------------------------------- Page Break ---------------------------------------- 23 claimants * * * whose awards of benefits have been vacated by the Benefits Review Board, as well as defend- ing the regulations he is charged with administering"). According standing to the Director in these circum- stances does not impugn any of the core concerns under- lying Article II I's "case or controversy" requirement. Here there is a concrete dispute as to the onset date of the claim- ant's permanent partial disability, the resolution of which will af feet the amount of benefits awarded to the claimant. And the Director's presence advocating that a greater pay- ment of benefits by the employer is required "assure[s] that the * * * questions presented to the court will be re- solved, not in the rarified atmosphere of a debating socie- ty, but in a concrete factual context conducive to a realistic appreciation of the consequences of judicial act ion." Valley Forge Christian College v. Americans United for Separation of Church & State, Inc., 454 U.S. 464, 472 (1982); see also Lujan, 112 S. Ct. at 2136; Trafficante, 409 U.S. at 211; Gladstone, Realtors v. Village of Bellwood, 441 U.S. 91, 112-115 (1979). 3. The court of appeals' ruling presents a serious obstacle to the Director's enforcement of the LHWCA. Under the court of appeals' narrow view of standing, the Director is left powerless to challenge erroneous Board rulings in many circumstances. Although the Act author- izes recovery of attorneys' fees by a prevailing claimant, 33 U.S.C. 928(a), because of the relatively modest amount of most awards, and the significant legal costs and risks asso- ciated with appellate review, an individual claimant may lack the incentive or ability to petition for review in a par- ticular case in which his claim is meritorious and import- ant legal issues are involved. The decision below also undermines the Director's dis- tinct policymaking role under the LHWCA. It is the Direc- tor's views on questions of statutory and regulatory inter- pretation, not the views of the Board, that are entitled to ---------------------------------------- Page Break ---------------------------------------- 24 deference from the courts. See Director, 0WCP v. General Dynamics Corp., 982 F.2d 790, 795 (2d Cir. 1992); Zapata Haynie Corp. v. Barnard, 933 F.2d 256,258 (4th Cir. 1991); Newport News Shipbuilding & Dry Dock Co. v. Howard, 904 F.2d 206, 208 (4th Cir. 1990); Boudreaux v. American Workover, Inc., 680 F.2d 1034, 1046 (5th Cir. 1982) (en bane), cert. denied, 459 U.S. 1170 (1983); 13 see also Potomac Elec. Power Co. v. Director, 0WCP, 449 U.S. 268, 278 n. 18 (1980) (Board is not a policymaking agency and its interpretations are not en- titled to special deference from the courts); cf. Mullins Coal Co. v. Director, OWCP, 484 U.S. 135, 159-160 (1987) (Director's construction of BLBA is entitled to deference). Under the Fourth Circuit's ruling, the Direc- tor's ability to advance her expert views, and thereby maintain uniform administration of the LHWCA, would be substantially impaired. See, e.g., Director, OWCP v. Bethlehem Steel Corp., 949 F.2d 185, 187 (5th Cir. 1991) (LHWCA was conceived out of a "constitutional demand for a nationwide uniformity"). Finally, the test applied by the court below, which was drawn from the Fifth Circuit's decision in Donzi Marine, creates confusion over what constitutes injury to a "legiti- mate administrative interest" of the Director. Compare, e.g., the Fifth Circuit's ruling in Donzi Marine, 586 F.2d at 381-382 (Director's legitimate administrative interests are not adversely affected by Board's legal ruling that recreational boat industry employees are not covered by LHWCA), with the Fifth Circuit's more recent decision in Bethlehem Steel Corp., 949 F.2d at 186-187 (Director's ___________________(footnotes) 13 But see Sea-Land Service, Inc. v. Rock, 953 F.2d 56, 59 (3d Cir. 1992); American Ship Bldg. Co. v. Director, OWCP, 865 F.2d 727, 730 (6th Cir. 1989) (neither Board nor Director is entitled to special deference). ---------------------------------------- Page Break ---------------------------------------- 25 interest adversely affected by Board ruling concerning when a total disability becomes a partial disability, when three courts of appeals had already rejected Board's posi- tion). A more straightforward approach to standing in this context, fully justified under the terms of the LHWCA and fully in accord with the Constitution, would permit the Director to petition for review of any Board decision resolving a benefits controversy that she, as a party to pro- ceedings before the Board, regards as erroneous. The D.C. Circuit has endorsed this approach to the Director's stand- ing, and the Third Circuit has expressed its approval of that approach as well. See pages 10-13, supra. The Court should resolve this important and recurring issue. CONCLUSION The petition for a writ of certiorari should be granted. Respectfully submitted. THOMAS S. WILLIAMSON, JR. Solicitor of Labor ALLEN H. FELDMAN Associate Solicitor STEVEN J. MANDEL Deputy Associate Solicitor MARK S. FLYNN Senior Appellate Attorney Department of Labor DREW S. DAYS III Solicitor General EDWIN S. KNEEDLER Deputy Solicitor General BETH S. BRINKMAN Assistant to the Solicitor General MAY 1994 ---------------------------------------- Page Break ---------------------------------------- APPENDIX A UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT No. 92-1864 DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, PETITIONER v. NEWPORT NEWS SHIPBUILDING AND DRY DOCK COMPANY, RESPONDENT v. JACKIE H. HARCUM, CLAIMANT On Petition for Review of an Order of the Benefits Review Board (90-1287) Argued: February 5, 1993 Decided: October 29, 1993 Before: ERVIN, Chief Judge, NIENEYER, Circuit Judge, and WARD, Senior United States District Judge for the Middle District of North Carolina, sitting by designation. (la) ---------------------------------------- Page Break ---------------------------------------- 2a OPINION ERVIN, Chief Judge: Jackie Harcum ("Claimant"), a former employee of Newport News Shipbuilding & Dry Company ("Newport News"), suffers from a work-related, disabling back in- jury. As an employee covered under the Longshore and Harbor Workers' Compensation Act ("LHWCA"), 33 U.S.C. 901-950, the Claimant filed a request for com- pensation benefits, which was partially granted and denied. On appeal, the Director of the Office of Worker's Compensation Programs in the United States Department of Labor ("Director") challenges the Benefits Review Board ("Board") as to its construction of the LHWCA on two grounds. First, the Director asserts that the Board im- properly determined that the Claimant's disability shifted from the status of temporary total disability to that of per- manent partial disability on May 6, 1988. In addition, the Director challenges the Board's application of a provision of the LHWCA to lessen substantially Newport News's obligation to pay benefits and to shift responsibility for compensation to a special fund organized under the LHWCA. Because we believe the Director lacks standing to raise the first issue, we decline to address it. Finding, however, that the Board erred in implicating the special fund and that the Director is the proper party to redress improper use of the fund, we reverse the Board's decision to limit Newport News's obligation to pay benefits. I The Claimant worked for Newport News as a machine installer from February 26, 1963 until May 6, 1988. Dur- ing his tenure with Newport News, the Claimant suffered a series of back injuries. According to his medical records, the Claimant sustained a lumbar strain on June 3, 1965, ---------------------------------------- Page Break ---------------------------------------- 3a and a more severe lumbosacral strain on February 8, 1966. At the time of this second injury, an x-ray of the Claimant's back revealed a sacral arch defect. The Claim- ant again experienced a lumbar strain on February 7, 1977, and was unable to work from February 27, 1977 through March 28, 1977 as a result. After two more related injuries in 1981 and 1983, the Claimant's physician referred him to a neurosurgeon. The neurosurgeon diagnosed the Claimant with a herniated disc in the cervical spine area and performed a hemilami- nectomy on January 24, 1984 to remove the disc. The Claimant responded well to the surgery and was able to return to work on March 5, 1984. On October 24, 1984, the Claimant suffered the injury that serves as the subject of this appeal. While bending down in the bilge area of a steam barge, the Claimant was struck in the lower back by a piece of falling grating. After a month of unabated leg and back pain, the Claimant returned to the neuro- surgeon. Tests revealed another herniated disc, this time in the lumbar spine area, and on January 11, 1985, the neurosurgeon removed the disc. On March 15, 1985, addi- tional surgery was performed to free a pinched nerve root and remove retained fragments of disc material. After a protracted recovery, the Claimant returned to light-duty work at Newport News on October 4, 1985, but immediately experienced back pain and was "passed out" of service temporarily to recuperate. Newport News paid the Claimant benefits under the LHWCA for temporary total and temporary partial disability until the Claimant again returned to Newport News's light duty facility in April 1987. On November 4, 1987, the Claimant's neuro- surgeon formulated restrictions by which he could return to his regular department. The doctor rated the Claimant as having an eighteen-percent whole body impairment and restricted his lifting to thirty pounds. The Claimant also ---------------------------------------- Page Break ---------------------------------------- 4a was to alternate regularly between sitting and standing and to refrain from ladder climbing. The Claimant returned to his regular department in January 1988, but was unable to perform the necessary tasks. Therefore, on May 6, 1988, the Claimant was passed out of the shipyard once again. Newport News of- ficials informed the Claimant that they would look for another job for him in the shipyard within his restrictions. The Claimant suggests that, based upon this reassurance, he did not look for a job outside of the shipyard at the time he was passed out. In August 1988, however, New- port News's supervisor of employee relations at the shipyard arranged a meeting with the Claimant. At the meeting, the Claimant was told that the shipyard had no work to offer him within his restrictions and that he was being referred to a rehabilitation counselor. The Claimant met with the rehabilitation counselor for the first time on September 20, 1988, and the two began developing a job placement and rehabilitation program for the Claimant. The Claimant then started his search for a new job. After following several leads supplied by the rehabilitation counselor, the Claimant was able to secure a job with the Hampton Sheet Metal Company ("Hampton Sheet Metal") on February 16, 1989. The Claimant still works at Hampton Sheet Metal in a job that is comfort- ably within his disability restrictions. At the time of the hearing on this matter before the Administrative Law Judge ("ALJ"), the Claimant was earning $5.00 per hour and working fort y hours per week. Subsequent to the Claimant's employment by Hampton Sheet Metal, New- port News requested that the rehabilitation counselor con- duct a labor survey of the available jobs for which the Claimant may have qualified during the period of May 6, 1988 to February 15, 1989. The completed survey listed eleven job possibilities. ---------------------------------------- Page Break ---------------------------------------- 5a The Claimant filed a request for compensation benefits under the LHWCA, and a hearing was held before an ALJ on October 20, 1989. In addition to the above facts, the parties presented medical opinions of three doctors. A doctor opined, at Newport New's behest, that [i]t is obvious the Mr. Harcum's current low back condition was not caused by any one injury. Rather, it is clear that Mr. Harcum's current low back condi- tion is the result of cumulative and repeated lumbar injuries. Each injury aggravated Mr. Harcum's low back problems and made him more susceptible to fur- ther back injuries, and each injury increased the severity of the subsequent injuries. This clearly con- stitutes a pre-existing permanent partial disability, and a cautious employer would not have hired Mr. Harcum with this manifest condition. Additionally, Mr. Harcum's cervical spine condition also substantially contributes to his current level of disability. As a result of shoulder injuries in 1981 and 1983, surgery was performed on Mr. Harcum's cer- vical spine. As I noted previously, this equates to a five percent (5070) whole body impairment. I agree with Dr. Peach's statement in his December 1, 1987 letter. Dr. Peach indicated that Mr. Harcum's level of whole body impairment is a result of two surgical pro- cedures: the 1984 surgery on Mr. Harcum's cervical spine and the 1985 surgery on his lumbar spine. The cervical and lumbar injuries, and the surgery they necessitated, clearly combined to create a greater im- pairment than would otherwise have occurred. This condition was manifest in Mr. Harcum's clinical record, and a cautious employer would not have hired him with this condition ---------------------------------------- Page Break ---------------------------------------- 6a Dr. Peach, the Claimant's neurosurgeon, indicated, in a December 1, 1987 letter, that the Claimant's permanent partial disability was due in part to both surgical pro- cedures involving the Claimant's cervical and lumbar spinal areas. Another doctor opined that "[i]t is clear that Mr. Harcum had a pre-existing partial impairment or disability that was materially increased by the second in- jury and disc herniation." After disposing of two issues not raised on this appeal, the ALJ addressed whether the Claimant was entitled to a temporary total disability award from May 6, 1988 until February 16, 1989. Citing Stevens v. Lockheed Ship- building Co., 22 BRBS 155, 157-59 (1989), the ALJ established the date of maximum medical improvement as the onset of permanent partial disability. As the parties had stipulated that date to be December 7, 1987, several months before the Claimant was passed out of the shipyard permanently, the ALJ determined that, for the purpose of benefit payments, permanent partial disability began when the Claimant was passed out or on May 6, 1988. Alternatively, the ALJ held that Newport News had shown successfully the availability of suitable alternate jobs that the Claimant was capable of performing from May 6, 1988 to February 15, 1989. Therefore, the Claim- ant's disability ceased to be a total disability on May 6, 1988, when the Claimant regained wage-earning capacity. The ALJ concluded that, from May 6, 1988, the Claim- ant should have received compensation based on a perm- anent partial disability rather than a temporary total disability. Based on the improper classification, the Claimant had received $101.34 per week in excess benefits during the period from May 6, 1988 to February 16, 1989. The ALJ held that Newport News was entitled to a credit against future benefits payments owed to the Claimant in ---------------------------------------- Page Break ---------------------------------------- 7a the amount of $101.34 per week for approximately forty weeks, the period of the overpayment. The ALJ addressed, as the final issue, whether Newport News was entitled to a reduction in the benefits it was re- quired to pay the Claimant pursuant to section 8(f) of the LHWCA, 33 U.S.C. 908(f). Section 8(f) limits an employer's responsibility to pay disability benefits to one hundred and four weeks if the employee's work-related in- jury was substantially exacerbated by a pre-existing per- manent partial disability. See id. 908(f)(1). Finding that Newport News had established each of the elements need- ed to enjoy section 8(f) relief, the ALJ limited Newport News's obligation to pay weekly benefits to the Claimant accordingly. The Director appealed the ALJ's decision to the Benefits Review Board as a "party in interest" pursuant to 33 U.S.C. 921(b)(3). On appeal, the Board affirmed the ALJ's decision in all respects, but with one clarification. The ALJ had relied, for its determination of the com- mencement of partial disability, on Stevens v. Lockheed Shipbuilding Co., 22 BRBS 155 (1989), which the Ninth Circuit court of appeals subsequently reversed. Stevens v. Director, Office of Workers' Compensation Programs, 909 F.2d 1256 (9th Cir. 1990), cert. denied sub nom. Lockheed Shipbuilding Co. v. Director, Office of Workers' Compensation Programs, 498 U.S. 1073 (1991). The Ninth Circuit court held that the date total disability becomes partial is the date on which the employer establishes that suitable alternate employment is available, not the date on which maximum medical improvement oc- curs. Id. at 1259-60. The Board vacated "the ad- ministrative law judge's reliance on the Board's decision in Stevens to commence Claimant's award of benefits for permanent partial disability on May 6, 1988." The Board ---------------------------------------- Page Break ---------------------------------------- 8a noted, however, that the ALJ alternatively held that May 6, 1988 was the proper date because Newport News had established job availability as of that date. On that basis, the Board affirmed the ALJ's decision. The Director petitioned this court for review of the Board's decision pursuant to 33 U.S.C. 921(c). The Director raises two issues on appeal: (1) whether the Board erred as a matter of law in accepting the ALJ's determina- tion of the Claimant's injury status change from that of temporary total disability to that of permanent partial disability; and (2) whether, in determining Newport News's entitlement to section 8(f) relief, the Board applied the incorrect standard. II The ALJ is the only adjudicative body handling a benefits determination that may make factual findings. See Lavino Shipping Co. v. Donovan, 267 F.2d 59, 61-62 (3d Cir. 1959). Therefore, the Board's review of the ALJ's factual findings is limited by the statutory requirement that "[t]he findings of fact in the decision under review by the Board shall be conclusive if supported by substantial evidence in the record considered as a whole. " 33 U.S. C. 921(b)(3). We review the Board's decision for errors of law and to ascertain whether the Board adhered to its statutorily-mandated standard for reviewing the ALJ's factual findings. Newport News Shipbuilding & Dry Dock Co. v. Tann, 841 F.2d 540, 543 (4th Cir. 1988). The Board's adjudicatory interpretation of the LHWCA is entitled to no special deference because the Board serves no policy-making role. See Zapata Haynie Corp. v. Bar- nard, 933 F.2d 256, 258 (4th Cir. 1991). The Director is charged with administration of the LHWCA; therefore, we should respect a reasonable interpretation of the ---------------------------------------- Page Break ---------------------------------------- 9a LHWCA by the Director. See id.; Newport News Ship- building & Dry Dock Co. v. Howard, 904 F.2d 206, 209 (4th Cir. 1990). We are guided by Chevron U. S. A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842-43 (1984) when deciding whether to accept a reasonable interpretation of the LHWCA advocated by the Director. Zapata, 933 F.2d at 258; Howard, 904 F.2d at 208. Absent clear congressional intent as to the proper construction of the LHWCA, we must give deference to the Director's reasonable and permissible interpretation. Zapata, 933 F.2d at 259; Howard, 904 F.2d at 209. Before reviewing the Board's determinations, however, we must address whether the Director has standing to peti- tion this court for review of the issues raised.1 The LHWCA permits "[a]ny person adversely affected or ag- grieved by a final order of the Board [to] obtain a review of that order in the United States court of appeals for the circuit in which the injury occurred." 33 U.S. C. 92 l(c). Unlike the provision of the LHWCA permitting "any par- ty in interest" to seek review before the Board, id. 921(b)(3), section 921(c) requires that the appellant be a "person . . . aggrieved," id. 921(c), or a party that has suffered an injury in fact, economic or otherwise. See Director, Office of Workers' Compensation Programs v. Newport News Shipbuilding & Dry Dock Co., 676 F.2d ___________________(footnotes) 1 Although not raised by the parties, standing presents an issue of the very justifiability of the claim presented and strikes at the core of the constitutional limitations placed upon this court by Article III of the Constitution. In this case, the LHWCA codifies the constitutional requirement that limits standing to those person who can allege "that they personally have suffered or imminently will suffer an injury." Er- win Chemrinsky, Federal Jurisdiction 2.3.2, at 52 (1989); see 33 U .S.C. 921(c). Before we can address the merits of the Director's ap- peal, we must determine whether this basic and nonwaivable mandate is met. ---------------------------------------- Page Break ---------------------------------------- 10a 110, 113 (4th Cir. 1982). We must decide whether the issues raised on appeal represent an actual injury to the Director. The Fifth Circuit court of appeals was the first circuit court to address the extent of the Director's standing to ap- peal pursuant to 33 U.S.C. 921(c). See Director, Office of Workers' Compensation Programs v. Donzi Marine, Inc., 586 F.2d 377 (5th Cir. 1978). In Donzi Marine, the Director questioned the extent to which the LHWCA ap- plied to the employees of small boat builders, marine operators, and other firms in the recreational boating in- dustry. Id. at 377. The court recognized that, before it could address the merits of the appeal, it must resolve "whether the Director, the sole petitioner, is `adversely af- fected or aggrieved' by the Board's decision [not to award benefits] as required by section 921(c). " Id. at 379 (quoting 33 U.S.C. 921(c)). The Donzi Marine court began its analysis by outlining the responsibilities conferred upon the Director by the LHWCA. The court concluded that the Director would have standing only if an interest of the Director arising from his or her specifically delegated responsibilities was adversely affected by the Board's decision. Id. The LHWCA confers four responsibilities upon the Director: (1) the performance of an assortment of general ad- ministrative and supervisory responsibilities, e.g. 33 U.S.C. 906(b)(3), 907, 914, 919, 923(b), 930, 932; (2) the provision of assistance to persons covered by the LHWCA in processing their claims and receiving compen- sation, id. 939; (3) the promulgation and enforcement of safety rules and regulations, id. 941; and (4) the duty to administer the special fund established for the payment of certain benefits, id. 944. See Donzi Marine, 586 F.2d at 379-80. ---------------------------------------- Page Break ---------------------------------------- lla The court suggested that the nature of the Director's responsibilities presented two avenues by which the Direc- tor might have standing to petition for appellate review. First, the Director may redress Board decisions that adversely affect the Director's legitimate administrative in- terests. Id. at 381. For example, if a Board decision substantially augmented the nature of the administrative duties delegated to the Director, increased the Director's necessary expenditure of administrative resources, or created confusion as to how the Director was to carry out specific functions, the Director's responsibilities under the LHWCA would be bound up sufficiently with the merits of the appeal to evidence a cognizable administrative in- jury. Id. at 381-82. In addition, the Director may seek review of a Board decision adversely impacting the special fund created to pay employees in certain instances in which the employer is relieved of that obligation. Id. at 380-81; see 33 U.S.C. 944. If the Board's decision favors payment out of the fund as opposed to by the employer, the depletion of the fund represents an injury in fact to the Director as ad- ministrator of the fund. The Donzi Marine court determined that, under the facts at hand neither the Director's legitimate ad- ministrative interests nor his or her pecuniary interest in protecting the fund was implicated. Id. at 380-82. Therefore, the court held that [the Director] does not meet the standing requirement imposed by section 921(c) and may not, on his own initiative and without the company of the claimant, petition to review the Board's decision to this court. At bottom, the Director appears here to claim no more than an interest in receiving from the Board an interpretation of the [LHWCA]'S coverage consistent ---------------------------------------- Page Break ---------------------------------------- 12a with his own belief as to what that coverage should be. The mere fact that the Board has chosen not to ac- cept the Director's view does not aggrieve the Director in any meaningful sense and, hence, cannot give him standing to appeal. We are unable, therefore, under the statute to render the advisory legal opinion which the Director seeks by his petition to this court. Id. at 382; see also Director, Office of Workers' Compen- sation Programs v. Bethlehem Steel Corp., 620 F.2d 60, 63 (5th Cir. 1980) (holding that Director is not a person "adversely affected or aggrieved" by an order of the Board which denies disability payments under the LHWCA); but see Shahady v. Atlas Tile & Marble Co., 673 F.2d 479,483 (D.C. Cir. 1982) ("[T]he Director's general supervisory and enforcement interest, apart from any pecuniary in- terest, is sufficient to confer upon the Director standing to file a petition for review under section 921(c)."). We adopted the clear logic of the Fifth Circuit court's Donzi Marine holding in Director, Office of Workers' Compensation Programs v. Newport News Shipbuilding & Dry Dock Co., F.2d 110 (4th Cir. 1982).2 In that case, we ___________________(footnotes) 2 We had decided previously that the Director is not a proper respondent in a petition for review under section 921(c), "although upon application and for good cause shown he may be permitted to in- tervene therein." I. T. O. Corp. v. Benefits Review Bd. (I.T.O. Corp. II), 563 F.2d 646, 648 (4th Cir. 1977) (en bane) (adopting in full the view expressed in I. T. O. Corp. v. Benefits Review Bd. (I. T. O. Corp. I), 542 F.2d 903,906-909 (4th Cir. 1976) (en bane), vacated sub nom. Adkins v. I.T.O. Corp., 433 U.S. 904(1977)). In I.T.O. Corp. I, we recognized that section 921 (c) requires an injury in fact, economic or otherwise. 542 F.2d at 907. We held the Director's asserted stake - that "[h]e is directly affected in his official capacity by the cor- rectness of the Board's decision involving the pro