Bethenergy Mines, Inc. v. Director, Office of Workers' Compensation Programs, U.S. Dept. of Labor, 89-3364

• Decision Date: 06 February 1990
• Docket Number: No. 89-3364,89-3364
• Citation: 890 F.2d 1295
• Parties: BETHENERGY MINES INC., Petitioner, v. DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, Respondent, and John C. Pauley, Respondent.
• Court: U.S. Court of Appeals — Third Circuit

Page 1295

890 F.2d 1295

BETHENERGY MINES INC., Petitioner, v. DIRECTOR, OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED

STATES DEPARTMENT OF LABOR, Respondent,

and

John C. Pauley, Respondent.

No. 89-3364.

United States Court of Appeals, Third Circuit.

Argued Nov. 8, 1989.

Decided Dec. 7, 1989.

Rehearing and Rehearing In Banc Denied Feb. 6, 1990.

John J. Bagnato (argued), Spence, Custer, Saylor, Wolfe & Rose, Johnstown, Pa., for petitioner.

Timothy P. Creany (argued), Blair V. Pawlowski, Pawlowski, Creany & Tulowitzki, Ebensburg, Pa., for respondent John C. Pauley.

Robert P. Davis, Sol. of Labor, Donald S. Shire, Associate Sol., Marta Kusic (argued), Atty., Michael J. Denney, Counsel for Appellate Litigation, U.S. Dept. of Labor, Office of the Sol., Washington, D.C., for respondent Director, Office of Workers' Compensation Programs.

Before MANSMANN and GREENBERG, Circuit Judges, and GAWTHROP, District Judge ^*.

OPINION OF THE COURT

GREENBERG, Circuit Judge.

This matter, involving a claim under the Black Lung Benefits Act of 1972, codified at 30 U.S.C. Sec. 901 et seq., is before this court on a petition for review of a decision and order of March 28, 1989, of the Benefits Review Board by Bethenergy Mines Inc., the employer of the respondent John C. Pauley.

The factual and procedural history of the case is as follows. On April 21, 1978, Pauley filed a claim under the Benefits Act with the Office of Workers' Compensation Programs which, after initially approving the claim, notified Bethenergy of its potential liability as the responsible operator. Though Bethenergy controverted the claim, upon further consideration the Office of Workers' Compensation Programs adhered to its position. Bethenergy then requested a formal hearing which was held before an administrative law judge.

In his decision of May 3, 1988, the administrative law judge first analyzed Pauley's claim as a Part C claim under the interim regulations at 20 C.F.R. Part 727 since the claim was filed prior to April 1, 1980, the effective date of the permanent regulations for black lung claims. The judge noted that 20 C.F.R. Sec. 727.203(a) contains a presumption for the benefit of miners with at least ten years coal mine experience that the miner has been totally disabled due to pneumoconiosis caused by his coal mine employment if he adduces medical evidence satisfying any of four requirements principally directed to establishing the presence of pneumoconiosis or a respiratory or pulmonary impairment. ¹ Pauley was entitled to the benefit of the presumption because Bethenergy conceded that he suffered from coal workers' pneumoconiosis and stipulated that he had 30 years coal mining experience.

The judge then considered whether Bethenergy had rebutted the presumption as permitted in various methods by 20 C.F.R. Sec. 727.203(b). He first concluded that it had not done so under 20 C.F.R. Sec. 727.203(b)(1) because Pauley had not worked since August 2, 1978, and thus was not doing his usual coal mine work or comparable and gainful work, a showing which if made would have rebutted the presumption. The judge also considered the claim under 20 C.F.R. Sec. 727.203(b)(2) which permits rebuttal if, in light of all relevant evidence, it is established that the miner is able to do his usual coal mine work or comparable and gainful work. The judge did not find rebuttal under that provision because he concluded that Pauley had "several medical problems, including severe arthritis, residual hemiparesis as the result of a stroke, and pulmonary disease." The judge further set forth that "[a]lthough not all of the physicians agree as to the cause or causes of [Pauley's] total disability, the more recent medical evidence, supported by [Pauley's] credible testimony, clearly establishes that [Pauley] is totally disabled from returning to coal mine employment."

The judge next considered 20 C.F.R. Sec. 727.203(b)(3) which provides for rebuttal if the "evidence establishes that the total disability or death of the miner did not arise in whole or in part out of coal mine employment." The judge, citing Carozza v. United States Steel Corp., 727 F.2d 74 (3d Cir.1984), set forth that under this subsection rebuttal could be established only if there was a finding that "pneumoconiosis does not contribute even in part to [a] claimant's total disability." After a thorough weighing of the evidence the judge concluded that Bethenergy "has sustained its burden of establishing that pneumoconiosis is not a contributing factor in [Pauley's] disability" and thus had succeeded in rebutting the presumption in Pauley's favor. ² This finding is not challenged on this appeal.

The judge indicated, however, citing our opinions in Halon v. Director, Office of Workers' Compensation Programs, 713 F.2d 30 (3d Cir.1982), reinstated on rehearing, 713 F.2d 21 (3d Cir.1983), that inasmuch as this case arises within the jurisdiction of this court he was required to consider the claim under the regulation at 20 C.F.R. Sec. 410.490. He found that in view of Bethenergy's concession that Pauley suffered from pneumoconiosis arising out of coal mine employment, Pauley was entitled to the presumption of total disability due to pneumoconiosis in that section. He then said that 20 C.F.R. Sec. 410.490 provides only two methods of rebuttal, either that there was evidence that the claimant was doing his usual coal mine work or comparable and gainful work or that evidence establishes that the claimant was able to do his usual coal mine work or comparable and gainful work. 20 C.F.R. Sec. 410.490(c). Bethenergy could not show either type of rebuttal because Pauley had not worked since August 2, 1978, and was, as the judge found, "clearly disabled from performing his usual coal mine work or comparable work as a result of his arthritis and residual hemiparesis." The judge further indicated that "[t]here is no evidence that [Pauley] is able to work in light of these conditions" and that, unlike 20 C.F.R. Sec. 727.203(b), 20 C.F.R. Sec. 410.490(c) "does not allow for rebuttal of the presumption by showing that the claimant's total disability is unrelated to his coal mine employment." Thus, Pauley was entitled to benefits.

After a motion for reconsideration by the administrative law judge was denied, Bethenergy appealed to the Benefits Review Board which affirmed in a two paragraph per curiam decision and order of March 28, 1989. The Board, after setting forth a concise history of the matter, held that: "In view of the decision of the United States Supreme Court in [Pittston Coal Group v. Sebben, --- U.S. ----, 109 S.Ct. 414, 102 L.Ed.2d 408 (1988) ], we reject [Bethenergy's] argument that the administrative law judge erred in applying [20 C.F.R.] Section 410.490 herein. Accordingly, the administrative law judge's Decision and Order awarding benefits is affirmed." (Omitting citations). The petition for review, over which we have jurisdiction under 30 U.S.C. Sec. 932(a) and 33 U.S.C. Sec. 921(c), followed. ³

Disposition of this appeal requires an explication of the relationship between claims under Parts B and C of the Benefits Act. ⁴ The purpose of the Act is to provide for disability payments to a miner totally disabled at least in part by pneumoconiosis if the disability arose out of coal mine employment. See Pittston v. Sebben, 109 S.Ct. at 417; Mullins Coal Co. v. Director, Office of Workers' Compensation Programs, 484 U.S. 135, 108 S.Ct. 427, 431, 98 L.Ed.2d 450 (1987); see also Bonessa v. United Steel Corp., 884 F.2d 726, 729 (3d Cir.1989). The program, as originally conceived, provided for a bifurcated system of administration. The Secretary of Health, Education and Welfare was to adjudicate claims pursuant to a temporary program of federally funded benefits under Part B of the Act. 30 U.S.C. Sec. 901(c), 30 U.S.C. Sec. 921, Pub.L. No. 91-173, 83 Stat. 792-98 (1969). ⁵ Pittston v. Sebben, 109 S.Ct. at 417. Congress envisioned, however, that there would be a more permanent program, operating under the auspices of the Secretary of Labor, relying on state workers' compensation programs. In fact, no state programs were approved by the Secretary of Labor and thus Part C has become an exclusively federally run workers' compensation program administered by the Secretary of Labor. Claims filed for living miners prior to July 1, 1973, and by survivors of miners who died prior to January 1, 1974 were Part B claims and those filed on or after those dates are Part C claims.

Eventually Congress became dissatisfied with the operation of the program and thus enacted the Black Lung Benefits Reform Act of 1977, Pub.L. No. 95-239, 92 Stat. 95 (1978), largely codified, as is the Benefits Act itself, in various sections of 30 U.S.C. Sec. 901 et seq. The Reform Act substantially altered the black lung regulatory scheme and amended 30 U.S.C. Sec. 902(f) to provide the Secretary of Labor with authority to determine eligibility criteria for Part C claims. See 30 U.S.C. Sec. 902(f)(1); Pittston v. Sebben, 109 S.Ct. at 418. In addition, the Reform Act required the reopening and, in some cases, readjudication of Part B claims previously denied by the Secretary of Health, Education and Welfare. See 30 U.S.C. Sec. 945; Halon v. Director, 713 F.2d at 22. Furthermore, Part C claims filed or pending before the effective date of the Department of Labor's permanent regulations, April 1, 1980, as well as reopened Part B claims, were to be evaluated in accordance with interim standards promulgated by the Secretary of Labor. See 30 U.S.C. Sec. 945.

The Reform Act in its subsection defining "total disability" placed the important restriction on the discretion of the Secretary of Labor in determining eligibility, that the criteria for any claim evaluated by him under 30 U.S.C. Sec. 945 and any claim filed on or before the effective date of the permanent regulations, "shall not be more restrictive than the criteria applicable to a claim...