not affect the propriety of concurrent awards
Conclusion
Statement of Related Cases
Certificate of Compliance
TABLE OF AUTHORITIES
Cases
Brady-Hamilton Stevedore Co. v. Director, OWCP (Anderson), 58 F.3d 419 (9th Cir. 1995)
Cordero v. Triple A Machine Shop, 580 F.2d 1331 (9th Cir. 1978)
Foundation Constructors, Inc. v. Director, OWCP, 950 F.2d 621 (9th Cir. 1991)
Hastings v. Earth Satellite Corp., 628 F.2d 85 (D.C. Cir. 1980)
Haughton Elevator Co. v. Lewis, 572 F.2d 447 (4th Cir. 1978)
Independent Stevedore Co. v. O'Leary, 357 F.2d 812 (9th Cir. 1966)
Kelaita v. Director, OWCP, 799 F.2d 1308 (9th Cir. 1986)
LaFaille v. Benefits Review Board, 884 F.2d 54 (2d Cir. 1989)
Lester v. Chater, 81 F.3d 821 (9th Cir. 1995)
Louisiana Ins. Guar. Assn v. Abbot, 40 F.3d 122 (5th Cir. 1994)
Matulic v. Director, OWCP, 154 F.3d 1052 (9th Cir. 1998)
Rashad v. Sullivan, 903 F.2d 1229 (9th Cir. 1990)
Stevedoring Serv. of America v. Director, OWCP (Benjamin), 297 F.3d 797 (9th Cir. 2002)
Stevens v. Director, OWCP, 909 F.2d 1256 (9th Cir. 1990)
Travelers Ins. Co. v. Cardillo, 225 F.2d 137 (2d Cir. 1955)
Walker v. Washington Metro. Area Transit Auth., 793 F.2d 319 (D.C. Cir. 1986)
White v. Bath Iron Works Corp., 812 F.2d 33 (1st Cir. 1987)
Statutes
Longshore and Harbor Workers' Compensation Act (LHWCA), 33 U.S.C. 901 et. seq.
Section 2(10)
Section 3(a)
Section 4(a)
Section 8(a)
Section 8(c)
Section 8(c)
Section 8(h)
Section 10
Section 10(a)
Section 10(c)
Section 19(d)
Section 21
Section 21(b)(3)
Section 21 (c)
STATEMENT OF JURISDICTION
This case involves claims for benefits under the Longshore and Harbor
Workers' Compensation Act (LHWCA or the Act), 33 U.S.C. § 901 et seq.
(1)
The administrative law judge (ALJ) had jurisdiction to hear and decide the
claims pursuant to Section 19(d) of the LHWCA, 33 U.S.C. § 919(d). The
Benefits Review Board (the Board) had jurisdiction to hear the timely appeal
and cross-appeal of Stevedoring Services of America (SSA) and Russell Everitt
(Everitt or the claimant) pursuant to Section 21(b)(3), 33 U.S.C. §
921(b)(3).
Everitt's injuries occurred in Seattle, Washington. The Board's final
decision was issued on October 30, 2002, and Everitt's and SSA's petitions for
review were filed in this Court on December 9, 2002, and December 16, 2002,
respectively, within 60 days of that decision. This Court therefore has
jurisdiction pursuant to Section 21(c) of the LHWCA, 33 U.S.C. § 921(c).
ISSUE PRESENTED
Whether the Benefits Review Board properly affirmed the administrative
law judge's conclusion that Marine Terminals Corporation (MTC) is no longer
liable for payment of permanent partial disability benefits under the LHWCA to
claimant Russell Everitt for a back injury that he suffered while in MTC's
employ.
STATEMENT OF THE CASE
A . Nature of the case, course of proceedings, and disposition
below
During the 1990s, Everitt suffered three lower back injuries while
working as a longshoreman at maritime sites. Excerpts of Record ("Rec. ") at 3.
This appeal principally concerns the second and third of these injuries, which
occurred on August 5, 1996 and October 14, 1997. Rec. at 3, 36. Everitt's
employers at the time of the 1996 and 1997 injuries were MTC and SSA,
respectively. Rec. at 36. At issue is whether MTC's liability for permanent
partial disability benefits under the LHWCA should continue beyond the date of
Everitt's 1997 injury with SSA.
Everitt filed timely claims for LHWCA benefits for the injuries, and an
ALJ conducted a hearing on the claims on October17,2000. Rec. at 2-3. The ALJ
issued a decision and order, as modified by two decisions on reconsideration,
ordering payment of benefits by both MTC and SSA. Rec. at 1-56 (April 4, 2001
Decision and Order); Id. at 59-79 (August 7, 2001 Decision on Motions for
Reconsideration); Id. at 81 (October 12, 2001 Second Decision on Motion for
Reconsideration). The ALJ ordered MTC to pay benefits for periods of temporary
total and temporary partial disability, followed by a period of permanent
partial disability benefits, to redress Everitt's loss of wage-earning capacity
caused by the 1996 injury at MTC. Rec. at 87. He ordered SSA to pay Everitt
temporary total disability benefits, beginning on October 14, 1997, the date of
the injury at SSA. Id.
As to the question whether MTC must pay permanent partial disability
benefits after the October 1997 injury, the ALJ ruled in his first decision on
reconsideration that such an award was appropriate in order to ensure that
claimant was fully compensated for his loss of wage-earning capacity. Rec. at
70-71. In his final decision on a second motion for reconsideration, however,
the ALJ reversed that ruling and concluded that MTC's liability ceased as of
the date of the October 1997 injury at SSA. Rec. at 85-86.
SSA and Everitt appealed to the Board, which on October 30, 2002,
issued a Decision and Order affirming in part and modifying in part the ALJ's
decisions. Rec. at 90-103. The Board modified the amount of total disability
benefits payable by SSA, but rejected SSA's arguments that the ALJ erroneously
terminated the permanent partial disability award against MTC as of the
occurrence of the October 1997 injury. Rec. at 95-98, 103. SSA and Everitt then
filed these petitions for review. (2)
B. Statement of facts
1. The statutory scheme
The LHWCA requires covered employers to provide compensation for
disability arising from injuries suffered in the course of employment. Section
2(10) of the Act defines "disability" in economic terms as "incapacity because
of injury to earn the wages which the employee was receiving at the time of
injury in the same or any other employment." 33 U.S.C. § 902(10). The Act
recognizes four types of disability -- permanent total, temporary total,
permanent partial, and temporary partial -- and prescribes rules for
determining the amount of compensation due in each instance.
(3)
These rules are generally calculated to compensate an employee according
to a formula tied to his actual loss of wage-earning capacity. Thus, an
employee who is totally disabled receives two-thirds of his average weekly wage
at the time of the injury. 33 U.S.C. § 908(a) (permanent total), (b)
(temporary total); see also id. § 10 (determination of average weekly
wage). An employee who is partially disabled is entitled to twothirds of the
difference between his pre-injury average weekly wage and his earning capacity
after the injury. 33 U.S.C. § 908(c)(21), (h).
(4)
2. Everitt's injuries
Everitt was diagnosed with degenerative disc disease following a low
back strain that he suffered on August 16, 1986, before he became a
longshoreman. Rec. at 37. The first of Everitt's three longshoring back
injuries occurred on March 25, 1994, when he twisted his lower back during the
course of an earlier period of employment with SSA. Rec. at 36. At the time of
the 1994 injury, Everitt's average weekly wage was $462.86. See Rec. at 38.
Everitt reached maximum medical improvement on April 28, 1995 and returned to
his regular job without suffering a loss of wage-earning capacity. Rec. at 39.
On August 5, 1996, while employed by MTC, Everitt suffered a second
injury when the cab of the truck he was driving was lifted into the air by a
crane and then dropped. Rec. at 36. At the time of this 1996 injury, Everitt's
average weekly wage was significantly higher - $1,955.01 per week - because he
was working six days per week and had reached "A" status in the union, which
gave him access to a greater range of jobs. Rec. at 38, 47, 87. Everitt was out
of work for six weeks after the 1996 injury.
Everitt returned to work on September 20, 1996. Rec. at 97 n.7. After
the 1996 injury, he could no longer perform the work of a stevedore and was
transferred from the "stevedore dispatch board" to the "bull dispatch board" to
find lighter work. (Supplemental Excerpts of Record (" Supp. Rec. ") at 89,
91-2, 132). Accordingly, his overall work opportunity (. . . continued) the
rules described above. decreased. Supp. Rec. at 94, 132, 151. Moreover, Everitt
was working in "extreme pain and with high dosages of narcotic medications."
Rec. at 39.
On October 14, 1997 - while once again working for SSA - Everitt
strained his lower back when he jumped to the ground from a cargo board. Rec.
at 36. It is undisputed that Everitt has been unable to perform gainful
employment since this injury and thus is totally disabled. Rec. at 41.
Everitt's wage-earning capacity after his 1996 injury and the amount of his
average weekly wage at the time of his 1997 injury have, however, been matters
of dispute between the parties.
3. The decisions on Everitt's claims
a. ALJ decisions
After a hearing, the AU issued an initial decision, followed by two
decisions on reconsideration, that cumulatively determined Everitt's
entitlement to various periods of total and partial disability benefits. Rec.
at 1, 59, 81.
i. The ultimate result of the ALJ's various rulings
As to the 1996 injury at MTC, the AU found that Everitt had an average
weekly wage of $1,955.01 at the time of that injury, and that the injury
"result[ed] in a demonstrated loss of wage-earning capacity." Rec. at 44. He
thus awarded temporary total, temporary partial, and permanent partial
disability benefits, payable by MTC, based on that average weekly wage. Id. at
44, 63, 87. The ALJ awarded permanent partial disability benefits for the
period from March 18, 1997 (the date of Everitt's maximum medical improvement)
to October 13, 1997 (the day before Everitt's injury at SSA). Rec. at 87. He
concluded that Everitt had a residual wage-earning capacity during that period
of $1,328.51 per week, and therefore awarded those benefits in the amount of
2/3 of the difference ($626.50) between Everitt's 1996 average weekly wage
($1,955.01) and that residual earning capacity. Rec. at 87.
As to the 1997 injury at SSA, the ALJ awarded Everitt temporary total
disability benefits, payable by SSA, commencing on the date of the injury,
October 14. Rec. at 87. (5) Based on his determination that Everitt was a 6-
day worker, the ALJ found that Everitt's average weekly wage at the time of the
injury was $1,936.04. Rec. at 83. He therefore calculated total disability
benefits based on the loss of a wage-earning capacity of that amount. Rec. at
87.
ii. The ALJ's rulings on MTC's liability for a concurrent award
The ALJ ultimately held that MTC's liability for permanent partial
disability terminated as of the October 14, 1997 injury at SSA. Rec. at 85. In
his decision after the first motions for reconsideration, however, he ruled
that a continuing award against MTC, to run concurrently with the award against
SSA, was appropriate under the rationale of Hastings v. Earth Satellite Corp.,
628 F.2d 85 (D.C. Cir. 1980). Rec. at 70. The AU found that "[i]f Claimant's
permanent partial disability award resulting from the ... [ 1996] injury is
terminated effective the date he became totally disabled from the ... [1997]
injury, he will have an uncompensated wage loss." Rec. at 70. Significantly, at
the time the AU issued this ruling in favor of a concurrent award, he also
concluded that Everitt had an average weekly wage of $1,328.51 at the time of
the 1997 injury, Rec. at 78, which is significantly lower than Everitt's
average weekly wage at the time of the 1996 injury - $1,955.01.
On MTC's subsequent motion for reconsideration, however, the ALJ
reversed this ruling on the ground that he was no longer persuaded that Everitt
had suffered a reduction in wage-earning capacity from the 1996 injury. Rec.
84-86. At the time he issued this ruling, the AU had also reevaluated Everitt's
average weekly wage at the time of the 1997 injury, concluding that it was
$1,936.04, Rec. at 83, or roughly equivalent to Everitt's average weekly wage
($1,955.01) at the time of the 1996 injury. The ALJ thus reasoned that a
"comparison of Claimant's wages earned both prior to and after 1996 reveal
little difference." Rec. at 86.
The ALJ further stated that claimant's "self-serving testimony" that he
worked beyond his capabilities while in great pain during 1996 and 1997 did not
suffice to establish a connection between the 1996 injury and a loss of earning
capacity. Rec. at 85-86. He concluded as well that no objective medical
evidence linked claimant's alleged wage-loss with the August 1996 injury .Rec.
at 86. The ALJ did not attempt to reconcile these findings with his award of
partial disability benefits for the period from September 1996 to October 13,
1997, which was premised on Everitt's loss of wage-earning capacity
attributable to the 1996 injury, or with his prior decision crediting
claimant's testimony regarding his inability to work. Rec. at 38, 44.
Finally, the ALJ concluded that under the "last employer rule," only SSA
was liable for compensation benefits after the 1997 injury. Rec. at 84 86. He
reasoned that because the subsequent 1997 injury "accelerated or deteriorated"
claimant's condition, SSA is solely liable as the last responsible employer.
Id. at 84.
b. The Board's decision
On appeals by Everitt and SSA, the Board affirmed in part and reversed
in part. Rec. at 90-104. The Board concluded that the ALJ appropriately
utilized Section 10(a) of the LHWCA, 33 U.S.C. § 910(a), rather than
Section 10(c), 33 U.S.C. § 910(c), when calculating Everitt's 1997 average
weekly wage. Rec. at 94-95. It further ruled, however, that the ALJ erroneously
treated Everitt as a six-day, rather than a five-day worker, thereby arriving
at an inflated average weekly wage of 1,936.04, instead of the correct figure
of $1,677.74. Rec. at 95-96.
The Board upheld the ALJ's conclusion that SSA was solely responsible
for benefits payments after October 14, 1997, the date of the SSA injury. Rec.
at 96-98. The Board concluded that SSA was fully liable for Everitt's
disability after the 1997 injury because it was an aggravation of claimant's
pre-existing back condition and the evidence did not show that claimant's
post-October 1997 disability was linked to his 1996 injury with MTC. Rec. at
97.
The Board also upheld the ALJ's ruling that it would be inappropriate to
provide for concurrent awards of partial and total disability to be paid by MTC
and SSA, respectively. Rec. at 97-98. The Board concluded that although such
awards are properly ordered "[w]here claimant suffers an injury which results
in partial disability, and subsequently suffers a second injury which results
in total disability," such an award should not be made where "the evidence at
the time of the second injury indicates that claimant's earnings increased such
that he no longer had a loss in wage-earning capacity." Rec. at 98. The Board
held that this was true with respect to claimant, noting that Everitt's average
weekly wage at the time of the 1997 injury was $1,677.74, compared to Everitt's
wage-earning capacity after the 1996 injury of $1,328.51. Id. The Board did not
compare claimant's average weekly wage at the time of his 1997 injury with his
higher average weekly wage ($1955.01) before the 1996 injury.
SUMMARY OF THE ARGUMENT
When a worker loses all of his earning capacity through a succession of
two (or more) injuries, the courts have recognized that the LHWCA provides for
separate, concurrent awards for the permanent loss of earning capacity
resulting from each injury. Brady-Hamilton Stevedore Co. v. Director, OWCP
(Anderson), 58 F.3d 419,421 (9th Cir. 1995); Hastings v. Earth Satellite Corp.,
628 F.2d 85, 91 (D.C. Cir. 1980). In this case, the Benefits Review Board
appeared to recognize this principle, but failed to require MTC to continue to
pay permanent partial disability benefits for claimant's 1996 injury at MTC
because it believed that, at the time of his subsequent injury in 1997 at SSA,
claimant no longer suffered a loss of wage-earning capacity from his MTC
injury. The Board's decision, however, does not account for the difference
between the ALJ's finding that the claimant's average weekly wage before the
1996 injury was $1,955.01 and the Board's ruling that the claimant's average
weekly earnings at the time of the 1997 injury were $1,677.74. This disparity
indicates that, under the facts as articulated by the Board, claimant continued
to suffer a diminished earning capacity, as a result of his 1996 injury at MTC.
If that is so, the total disability award against SSA, which is based on
claimant's already reduced wage-earning capacity at the time of the 1997
injury, will not fully compensate him. A concurrent permanent partial
disability award should therefore be entered against MTC. Hastings, 628 F.2d at
91.
The Board and AU also improperly relied on the "last employer" and
"aggravation", rules to extinguish MTC's liability. The Board's decision seems
to endorse the theory that because the subsequent 1997 injury at SSA aggravated
Everitt's pre-existing condition, SSA is solely liable even though the 1996 and
1997 injuries were the subjects of two separate claims. Neither the last
employer rule nor the aggravation rule suggests, however, that where an
employee has filed a claim for an injury, his right to relief on a claim is
divested by his subsequent filing of another claim regarding a subsequent
injury. Indeed, this Court in Stevedoring Servs. of America v. Director, OWCP
(Benjamin), 297 F.3d 797, 802-04 (2002), expressly rejected such a "last
employer" argument, holding that the first employer remained liable on a claim
for hearing loss chargeable to its employ, even though the claimant also had a
claim for additional hearing loss against a subsequent employer. In light of
Benjamin's holding that there is no merger of such separate claims for
distinct, quantifiable injuries, it is clear that the last employer rule
provides no basis for upholding the ALJ's termination of the permanent partial
disability award against MTC.
The Board's decision - which on its face fails to fully compensate the
claimant for his loss of wage-earning capacity - should therefore not be
affirmed. At a minimum, the case should be remanded for reconciliation of the
disparity between the pre-injury average weekly wage figures for claimant's
1996 and 1997 injuries and the decision to deny concurrent awards. Then - if
claimant is indeed found to have suffered a loss of wage earning capacity as a
result of the 1996 injury - the ALJ should tailor concurrent awards, including
a continuing permanent partial disability award payable by MTC, so that
claimant is fully compensated.
ARGUMENT
THE BOARD HAS PROVIDED INSUFFICIENT REASONS FOR REFUSING TO REQUIRE
MTC TO PAY ONGOING PERMANENT PARTIAL DISABILITY BENEFITS CONCURRENTLY WITH THE
TOTAL DISABILITY AWARD ASSESSED AGAINST SSA
A. Standard of Review
This Court reviews decisions of the Board for errors of law and for
adherence to the substantial evidence standard of review. Benjamin, 297 F.3d at
801; 33 U.S.C. § 921(b)(3). The Court reviews legal conclusions de novo,
but "[o]n issues of statutory interpretation [under the LHWCA], the Director's
view is to be accorded considerable weight." Benjamin
, 297 F.3d at
801.Moreover, it is the Director, and not the Board, "to whom ... [the Court]
owe[s] Chevron deference." Id. at 801-02.
B. Concurrent Awards of Partial Disability Benefits and Total Disability
Benefits Should be Assessed Against MTC and SSA Respectively If Necessary To
Compensate Claimant for His Overall Loss of Wage Earning Capacity
Under the LHWCA, benefit awards are designed to compensate employees for
their loss of wage-earning capacity due to work injuries. 33 U.S.C. §
908(a), (c)(21). As explained below, where employees have filed claims
regarding successive injuries, it is often necessary to provide concurrent
awards, so that the reduction of wage-earning capacity attributable to each
injury, and hence the employee's overall reduction in wage-earning capacity,
are compensated. Hastings, 628 F.2d at 91. Indeed, the Board in this case
recognized that "where [a] claimant suffers an injury which results in partial
disability and subsequently suffers a second injury which results in total
disability, claimant may receive concurrent awards for the two disabilities."
Rec. at 98, citing Hastings. The Board indicated, however, that it was
appropriate to terminate the first award "if, as here, the evidence at the time
of the second injury indicates that claimant's earnings increased such that he
no longer had a loss in wage-earning capacity." Rec. at 98, citing Anderson, 58
F.3d at 421.
Although the Director takes no position in this brief on the factual
question whether claimant Everitt's wage-earning capacity was affected by the
1996 injury, the Board's decision, concluding that his wage-earning capacity
was not so affected, is flawed on its face. Accordingly, the Director presents
his position that concurrent awards of partial and total disability benefits
should be entered where necessary to fully compensate a claimant, and that
neither the last employer rule nor aggravation rule bars such awards. the last
employer rule nor aggravation rule bars such awards.
1. The Board's and ALJ's reasons for concluding that Everitt did not
suffer a continuing reduction in wage-earning capacity from the 1996 injury are
inadequate
The Board's conclusion that the claimant's earnings had increased at the
time of the 1997 injury, so that he no longer had a loss in wage-earning
capacity from the 1996 injury, is contradicted by the facts of the case as
articulated by the Board. Everitt's average weekly wage at the time of the 1996
injury with MTC was $1,955.01 per week, while, as redetermined by the Board,
his average weekly wage at the time of the 1997 injury at SSA was $1,677.74 per
week. Thus, Everitt's wage-earning capacity was still lower at the time of the
1997 injury than it had been at the time of the 1996 injury.
The Board failed to recognize the continued effect of the 1996 injury
because it erroneously compared Everitt's 1997 average weekly wage ($1,677.74)
to his wage-earning capacity ($1,328.51) after the 1996 injury. Rec. at
97-98.Obviously, this is not an apt comparison since the $1,328.51 figure
already reflects the wage-earning loss caused by the 1996 injury. Thus, the
comparison clearly does not indicate that claimant had regained his pre-1996
injury earning capacity by the time of the 1997 injury at SSA.
Nor does the Board's opinion adequately address the question whether
substantial evidence supports the ALJ's finding, rendered in his second
decision on reconsideration, that the 1996 injury did not have a continuing
effect on claimant's wage-earning capacity. First, the ALJ's conclusion was
based, at least in part, on his finding that claimant's average weekly wage at
the time of the 1997 injury was $1,936.04, see Rec. at 83, 86 -- a figure that
the Board concluded was erroneous and adjusted downward to $1677.74.
Second, the AU otherwise inadequately explained the finding that the
1996 injury had no continuing effect on claimant's wage-earning capacity. This
finding contradicts his earlier determination awarding Everitt permanent
partial disability benefits from March 18, 1997 to October 13, 1997, based upon
an actual residual earning capacity of $1,328.51 per week. Rec. at 87. This
earlier ruling reflects a finding that the 1996 injury did result in lost
earnings of $626.50 per week ($1,955.01-1,328.51=$626.50). Id. The ALJ's
finding also contradicts his earlier assessment that after claimant reached
maximum medical improvement in 1997, "not only did his actual wages go down,
his wage earning capacity went down even further." Rec. at 39; see also id.
("[c]laimant credibly testified before me that he was able to earn those wages
[in March to October 1997] only by working with extreme pain and with high
dosages of narcotic medications"). (6) Without having taken further evidence,
the ALJ in his October 12, 2001 decision derided the Claimant's heretofore
"credibl[e]," "probative and persuasive" testimony about his post-1996
condition, Rec. at 39, 43, as "self-serving" and uncorroborated by medical
evidence. Rec. at 85. In similar circumstances involving a claimant's
entitlement to Social Security disability benefits, however, this Court has
concluded that an ALJ "must provide 'specific, cogent reasons for [his]
disbelief" of a claimant's testimony regarding pain and its limiting effect on
his activities. Lester v. Chater, 81 F.3d 821, 834 (1995), citing Rashad v.
Sullivan, 903 F.2d 1229, 1231 (9th Cir. 1990). The ALJ's conclusory statement
regarding the claimant's lack of credibility does not appear to meet this
standard. (7)
2. To the extent Everitt suffered a loss of wage-earning capacity
from the 1996 injury, MTC should be required to pay permanent partial
disability benefits concurrently with the total disability award against
SSA
As noted, under the LHWCA, the compensation for permanent disability
caused by a "non-scheduled" injury - such as the back injury here - is
determined by calculating two-thirds of the difference between the claimant's
"average weekly wage" at the time of the compensable injury and his or her
"wage-earning capacity" after the injury. LHWCA § 8(c)(21), (h), 33 U.S.C.
§ 908(c)(21), (h). When a worker, such as Everitt, loses all of his
earning capacity through a succession of two (or more) injuries, the courts
have recognized that the Act provides for separate, concurrent awards for the
permanent loss of earning capacity resulting from each injury.
In Hastings, the court of appeals held that concurrent awards were
mandated in a two-claim context similar to that presented here. Hastings
initially suffered a work-related stroke in 1971. 628 F.2d at 86. He
subsequently returned to part-time work for a period of two years. In 1974, he
was diagnosed with pulmonary emboli, aggravated by his intervening work, and
ceased all employment. Id. at 87.
An ALJ awarded Hastings benefits for: (1) permanent partial disability,
beginning in 1972, for his partial loss of wage-earning capacity due to the
stroke, based on actual wage loss under § 8(c)(21) of the Act; and (2)
permanent total disability, beginning in 1974, for the loss of the remainder of
his wage-earning capacity as a result of the emboli. 628 F.2d at 87-88. The ALJ
ruled, however, that permanent partial disability benefits should cease upon
initiation of the permanent total disability award. Id. at 88.
On appeal, the Board reversed, holding that to fully compensate Hastings
for his entire wage-loss as a result of both injuries, the permanent partial
disability award must continue concurrently with the permanent total disability
award. 628 F.2d at 89. The court of appeals affirmed, ruling that the Board's
"conclusion [wa]s compelled," because under the Act, compensation for Hastings'
permanent total disability was based "on his diminished earning capacity" at
the time of the second injury (the emboli), rather than "on [the] ... earning
capacity he possessed before the stroke." Id. at 91. Since Hastings'
"compensation for his original loss of earning capacity was ... addressed in
the permanent-partial disability award," the court concluded that "logic and
fairness require[d] that the permanent-partial disability award continue
concurrently with the permanent-total award." Id.
The court illustrated with a hypothetical:
Consider a worker earning $10,000 per year. An accident permanently
reduces his earning capacity to $6,000. He is awarded compensation based on the
$4,000 diminution in his earning capacity. A second accident disables him
totally. The second compensation award is based on the $6,000 in earning
capacity remaining after the first accident. Terminating the first award at the
onset of the second would deprive the worker of compensation for the permanent
loss of $4,000 in earning capacity.
Id. at 91.
In Anderson, this Court concurred with the D.C. Circuit's "methodology,"
emphasizing that the claimant's "earning capacity at the time of the second
injury must be used in computing the total disability award for that injury,"
so that both the total disability and partial disability awards are necessary
in order to compensate the claimant for all of his lost earning capacity. 58
F.3d at 421. Such awards are proper, the court concluded, unless they exceed
the measure of compensation provided in Section 8 of the Act and permit
"double-dipping," as when the claimant's wage-earning capacity has increased
during the period between the initial and subsequent injury. Id.; see also
Hastings, 628 F.2d at 96 n.30 (acknowledging that an increase in a claimant's
earning capacity between injuries could result in "double-dipping" because the
"aggregate disability payments would ... represent[] more earning capacity than
he had to begin with"). (8)
These principles, when applied to this case, illustrate that a
concurrent award of benefits may be in order. Everitt's total disability award,
as determined by the Board, is based on his loss of a wage-earning capacity of
$1,677.74, his average weekly wage at the time of the 1997 injury. However, his
initial average weekly wage, before the 1996 injury, was $1,955.01. Thus, there
appears to remain an uncompensated decrease in wage-earning capacity in the
amount of $277.27, that will be compensated only if a permanent partial
disability award against MTC continues. (9)
3. The "last employer" and "aggravation" rules do not affect the
propriety of concurrent awards
The ALJ relied on the "last employer" rule as a basis for refusing to
permit a continuing award against MTC. Rec. at 84-85. Although the Board's
decision is not entirely clear in this regard, it also suggests that the "last
employer" and "aggravation" rules support the termination of MTC's liability as
of the time of the 1997 injury at SSA. See Rec. at 96-97; see also MTC Br. 16
(arguing that a concurrent award is inappropriate under "last employer" rule).
As we explain, however, the last employer rule merely provides that an employer
is liable for a worker's injury that occurs in its employ, even though the
injury is an aggravation of an earlier workplace injury or the product of the
worker's earlier workplace exposures. It does not exonerate an employer from
liability on a claim "just because a second employer can also be assigned
liability under the same doctrine for a separate, later injury." Benjamin, 297
F.3d at 805. Thus, the last employer rule does not absolve MTC from continued
liability on Everitt's claim for the portion of disability attributable to his
injury at MTC.
As first formulated in Travelers Ins. Co. v. Cardillo, 225 F.2d 137, 145
(2d Cir. 1955), the "last employer" rule states that
the employer during the last employment in which claimant was exposed
to injurious stimuli ... should be liable for the full amount of the award.
Accord Cordero v. Triple A Machine Shop, 580 F.2d 1331, 1337 (9th Cir.
1978). The rule "facilitates administrative convenience by allowing for full
recovery in a single action after a disability is discovered, as opposed to
piece-meal recovery in a multitude of actions against each contributing
employer." Benjamin, 297 F.2d at 802; Cordero, 580 F.2d at 1336 rejecting
employer's argument that its due process rights are violated by the failure to
reduce its liability by apportioning responsibility among employers who
contributed to employees' exposure to fumes).
In Kelaita v. Director, OWCP, 799 F.2d 1308 (1986), this Court held that
with respect to "cumulative trauma" injuries, the last employer rule required
that
[if] the disability resulted from the natural progression of a prior
injury and would have occurred notwithstanding the subsequent injury, then the
prior injury is compensable and accordingly, the prior employer is responsible.
If, on the other hand, the subsequent injury aggravated, accelerated or
combined with claimant's prior injury, thus resulting in claimant's disability,
then the subsequent injury is the compensable injury and the subsequent
employer is responsible.
Foundation Constructors, Inc. v. Director, OWCP, 950 F.2d 621, 624 (9th
Cir. 1991), quoting Kelaita, 799 F.2d at 1311.
In Kelaita, a worker suffered cumulative trauma injuries to his rotator
cuff while working for two different employers and filed separate claims
against each. 799 F.2d at 1309. The Court applied the last employer rule to
this "two injury" situation and concluded that during more than a year of
employment with the second employer, the claimant aggravated his initial
injury. Id: at 1311-12. It thus found the second employer liable for the full
amount of the award of benefits.
This variant of the last employer rule - which the Court identified as
the "two-injury" rule - is simply a restatement of the long-standing
aggravation rule, first articulated by this Court in Independent Stevedore Co.
v. O'Leary, 357 F.2d 812, 814 (1966). It holds that a work-related aggravation
of an initial injury is considered a new injury, giving rise to a new cause of
action and the imposition of new liabilities on a separate, fully compensable
claim. See Todd Shipyards Corp. v. Director, OWCP, 139 F.3d 1309, 1312 (9th
Cir. 1998); see also Bludworth Shipyard, Inc. v. Lira, 700 F.2d 1046, 1049 (5th
Cir. 1983) (recognizing that "[a]ggravation of a pre- existing condition can be
an 'injury' under the Act").
Neither the last employer rule nor the aggravation rule suggests,
however, that where an employee has filed a claim for an injury, his right to
vindicate that claim is divested by his subsequent filing of another claim 28
regarding a subsequent injury. Certainly, nothing in the text of the statute
supports that result. Rather, the statute imposes liability on an employer for
compensation in cases of permanent partial disability, and gives the employee
the right to obtain compensation for his loss of wage-earning capacity tied to
that injury. 33 U.S.C. §§ 903(a), 904(a), 908(c)(21).
Indeed, in Benjamin, 297 F.3d 797, this Court expressly rejected the
view that the last employer rule absolves a prior employer against whom a claim
has been filed from liability on that claim. In that case, the employee filed
two claims on the basis of successive audiograms, one obtained during his
employ with a prior employer showing a .5% hearing loss, and another from a
subsequent employer showing that the hearing loss had worsen to 34%. Id. at
799-800. The AU treated the two claims as merged, and concluded that the second
employer was solely liable under the "last employer" rule. Id. at 801, 803.
Benjamin held that this was error, stating:
no case holds that two entirely separate injuries are to be treated as
one when the first one causes, or is at least partially responsible for, a
recognized disability .... The Cardillo rule allocates liability to one
employer, the last employer, after a disability determination has been made
with a determinative audiogram. It does not imply that there can be only one
last employer for every worker.
Id. at 803-804.
Furthermore, Benjamin rejected the notion that liability on an earlier
LHWCA claim for a quantifiable injury may be extinguished via the fortuity
"that the case was delayed to the point that the second claim became part of
the same dispute." Id. at 804. Rather, the Court concluded, each employer
remains separately liable on the claim for the impairment caused by the injury
incurred in its employ. Id. at 805 (first employer is liable for 28.5% hearing
loss).
The ALJ and Board cited this Court's decisions in Kelaita, 799 F.2d
1308, and Foundation Constructors, 950 F.2d at 621, as supporting the
termination of MTC's liability. Thus, they appeared to believe that because
SSA's liability was premised on an aggravation of Everitt's back condition
-which they likened to the rotator cuff and back injury aggravations
experienced by the claimants in Kelaita and Foundation Constructors - SSA was
solely liable under the rationale of those cases. Rec. at 96. The Board,
however, failed to recognize that even if Everitt's work at SSA did aggravate
his back condition, any such aggravation did not operate to extinguish MTC's
liability because Everitt had suffered a discrete, documented loss of earning
capacity as a result of his 1996 injury at MTC. Benjamin, 297 F.3d at 805. In
contrast, there is no indication in this Court's opinions in Kelaita or
Foundation Constructors that those claimants suffered a similar reduction of
wage-earning capacity from the first injury.
Accordingly, the guiding precedent for this case is Benjamin. Like the
first employer in Benjamin, MTC retains responsibility for the claim filed for
the injury incurred in its employ, even though Everitt suffered a similar, and
further disabling, injury while working for a subsequent employer.
CONCLUSION
For the reasons stated above, the decision of the Benefits Review Board
should be reversed. The case should be remanded for a determination whether
concurrent awards are needed to compensate the claimant fully for the
cumulative loss of his wage-earning capacity caused by the 1996 and 1997
injuries, and, if so, a permanent partial disability award should be entered
against MTC that runs concurrently with the total disability award against SSA.
Respectfully submitted,
HOWARD M. RADZELY
Acting Solicitor of Labor
DONALD S. SHIRE
Associate Solicitor
MARK S. FLYNN
Acting Counsel for Longshore
WHITNEY R. GIVEN
Attorney
U.S. Department of Labor
Office of the Solicitor
Suite
N-2117
Frances Perkins Building
200 Constitution Ave., N. W.
Washington, D.C. 20210
(202) 693-5784
Attorneys for the Director,
Office of Workers'
Compensation Programs
STATEMENT OF RELATED CASES
The Director is not aware of any pending related cases.
CERTIFICATE OF COMPLIANCE
The text of this brief is double-spaced, with the exception of
quotations more than two lines long, headings and footnotes, which are
single-spaced. The typeface used is 14 points and is proportionately spaced.
The word count according to MS WORD, the processing system used, is 6,888
Mark S. Flynn
Acting Counsel for Longshore
U.S. Department of
Labor
Footnotes
1. Longshore and Harbor Workers' Compensation Act of Mar. 4, 1927, c.
509, 44 Stat. 1424, as amended, 33 U.S.C. §§ 901-950 (2000).
2. SSA has also appealed rulings by the Board upholding determinations by
the ALJ and by the Director, Office of Worker's Compensation Programs
("Director"), on SSA's liability for claimant's attorney's fees. See Rec. at
99103. This brief does not address the attorney's fee issue.
3. The terms "total" and "partial" refer to the degree of disability,
while the terms "temporary" and "permanent" refer to the nature or duration of
the disability. Stevens v. Director, OWCP, 909 F.2d 1256, 1259 (9th Cir. 1990).
A disability is considered temporary until the employee reaches the point of
maximum medical improvement, i. e., the point at which his condition appears to
be of lasting or indefinite duration, as distinguished from one in which
recovery merely awaits a normal healing period. Louisiana Ins. Guar. Ass'n v.
Abbot, 40 F.3d 122, 126 (5th Cir. 1994); Stevens, 909 F.2d at 1257 (maximum
medical improvement is "attained when the injury has healed to the full extent
possible"). Once he reaches maximum medical improvement, an employee's
remaining disability is considered permanent in nature.
4. Although the LHWCA generally compensates according to the employee's
actual loss of wage-earning capacity, an exception exists with respect to
permanent partial disabilities resulting from enumerated "scheduled" injuries.
33 U.S.C. § 908(c). For those disabilities, an employee is provided the
equivalent of two-thirds of his previous average weekly wage for a specified
number of weeks, regardless of his actual loss of wage-earning capacity. This
case does not involve a scheduled injury and is governed by the rules described
above.
5. Everitt's total disability is "temporary" because, at the time the
hearing record closed in this case, he had not reached maximum medical
improvement. Rec. at 41.
6. The ALJ also found that: While [MTC] contend[s] that the 1996 injury
was a temporary aggravation and did not result in any permanent partial
disability, I disagree because I find Claimant's thesis and evidence in support
thereof to be most probative and persuasive. While [MTC] contend[s] that there
is no medical evidence to support such [a] claim, Claimant submits, and I
agree, that the totality of this closed recordleads to the conclusion
that Claimant's low back problems since 1986 were aggravated by his ... 1994
and August 5, 1996 injuries, resulting in a demonstrated loss of wage-earning
capacity.
Rec. at 43 (emphasis added).
7. This Court has recognized that: Once the claimant produces medical
evidence of an underlying impairment, the [ALJ] may not discredit the
claimant's testimony as to subjective symptoms merely because they are
unsupported by objective evidence.... Unless there is affirmative evidence
showing that the claimant is malingering, the [ALJ's] reasons for rejecting the
claimant's testimony must be "clear and convincing.". . . General findings are
insufficient; rather, the ALJ must identify what testimony is not credible and
what evidence undermines the claimant's complaints.
Lester v. Chater,
81 F.3d 821, 834 (9th Cir. 1995) (citations omitted).
8. Anderson's reference to Section 8(a) of the Act as a "statutory limit"
on compensation is somewhat confusing, because that provision provides for
total disability benefits based on the employee's average weekly wage at the
time of the totally disabling injury. 33 U.S.C. § 908(a). If this average
weekly wage were an absolute limit, then no concurrent partial and total
disability awards would be appropriate, a result at odds with Anderson's
endorsement of concurrent awards where appropriate. That is because every total
disability award is 2/3 of the latest injury's average weekly wage, meaning
that in all cases any additional award would violate the "limit." Rather, it
appears from context that Anderson meant to describe situations where
concurrent awards would compensate a claimant for more than his overall
reduction in wage-earning capacity. See 5 8 F.3 d at 422 (noting that "the ALJ
did not address whether Anderson's ability to earn a higher wage increased
during the period between his injuries"). We note, in this regard, that Section
6(b)(1) of the Act, 33 U.S.C. § 906(b)(1), sets a maximum for an award,
but as the D.C. Circuit concluded in Hastings, this provision creates a maximum
compensation rate applying to a single award, and is therefore not relevant to
the combined amount of concurrent awards. Hastings, 628 F.2d at 91.
9. As discussed supra, note 8, this Court in Anderson cautioned that
concurrent awards should not overcompensate a claimant, as where the claimant's
wage-earning capacity has increased since the first permanent partial
disability award, and there has been no modification of that award to reflect
the increase. In this case, claimant's wage-earning capacity after the 1996
injury, as determined under Section 8(h) of the Act, was $1,328.51, while his
average weekly wage at the time of the 1997 injury, as calculated under Section
10(a) of the Act, is $1,677.74. The fact, however, that a claimant's Section
10(a) average weekly wage before the second injury is higher than a claimant's
Section 8(h) wage-earning capacity after the first injury does not necessarily
mean that a claimant's wage-earning capacity has increased in the interim.
First, the Section 8(h) wage-earning capacity figure may have been adjusted
downward from claimant's actual earnings to reflect its time-of-injury
equivalent (in order to account for inflation) or to account for the fact that
the claimant was working beyond his medical restrictions. LaFaille v. Benefits
Review Board, 884 F.2d 54, 61 (2d Cir. 1989) (inflation adjustment); accord,
White v. Bath Iron Works Corp., 812 F.2d 33, 35 (1st Cir. 1987); Walker v.
Washington Metro. Area Transit Auth., 793 F.2d 319, 323 nn.5, 6 (D.C. Cir.
1986); cf. Haughton Elevator Co. v. Lewis, 572 F.2d 447, 450-51 (4th Cir. 1978)
(Winter, J., concurring) (claimant whose work postinjury is only through
"extraordinary effort" or in spite of "excruciating pain" may be totally
disabled despite substantial actual earnings). Second, calculating a worker's
average weekly wages under the Section 10(a) formula, as explained by this
Court in Matulic v. Director, OWCP, 154 F.3d 1052, 1057 (1998), may result in a
measure of legislatively sanctioned "inaccuracy in the estimation of the
worker's earning capacity" that "favor[s] the worker." In any event, questions
about whether particular amounts of concurrent awards would overcompensate
claimant in this case are best considered in the first instance on remand.
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