Creech v. Apogee Coal Co.

Decision Date28 November 2022
Docket Number20-0322 BLA
CourtCourt of Appeals of Black Lung Complaints


Appeal of the Decision and Order Awarding Benefits of Scott R Morris, Administrative Law Judge, United States Department of Labor.

Michael A. Pusateri (Greenberg Traurig LLP), Washington D.C. for Employer and its Carrier. Joseph E. Wolfe and Brad A Austin (Wolfe Williams &Reynolds), Norton, Virginia, for Claimant.

Ann Marie Scarpino (Seema Nanda, Solicitor of Labor; Barry H. Joyner, Associate Solicitor), Washington, D.C., for the Director, Office of Workers' Compensation Programs, United States Department of Labor.

Before: BOGGS, Chief Administrative Appeals Judge, BUZZARD and GRESH, Administrative Appeals Judges.



Employer and its Carrier (Employer) appeal Administrative Law Judge (ALJ) Scott R. Morris's Decision and Order Awarding Benefits (2018-BLA-06053) rendered on a miner's subsequent claim filed on July 28, 2016,[1] pursuant to the Black Lung Benefits Act, as amended, 30 U.S.C §§901-944 (2018) (Act).

The ALJ found Apogee Coal Company (Apogee) is the responsible operator and Arch Coal, Incorporated (Arch Coal) is the responsible carrier. He found Claimant established 29.47 years of qualifying coal mine employment and a totally disabling respiratory or pulmonary impairment. 20 C.F.R. §718.204(b)(2). Thus, he found Claimant established a change in an applicable condition of entitlement[2] and invoked the rebuttable presumption of total disability due to pneumoconiosis at Section 411(c)(4) of the Act, 30 U.S.C. §921(c)(4) (2018).[3] The ALJ further concluded Employer did not rebut the presumption and awarded benefits.

On appeal, Employer argues the ALJ lacked the authority to decide the case because he was not appointed in accordance with the Appointments Clause of the Constitution, Art. II § 2, cl. 2.[4] It further asserts remand is required because removal provisions applicable to ALJs render his appointment unconstitutional. Next, it contends the ALJ erred in finding Apogee, self-insured through Arch Coal, is the responsible operator. On the merits, Employer argues the ALJ erred in finding Claimant invoked the Section 411(c)(4) presumption and Employer did not rebut it. Claimant responds urging affirmance of the award. The Director, Office of Workers' Compensation Programs (the Director), filed a limited response, urging the Benefits Review Board to reject Employer's constitutional challenge and affirm the ALJ's responsible operator determination. Employer filed a combined reply brief.

The Board's scope of review is defined by statute. We must affirm the ALJ's Decision and Order if it is rational, supported by substantial evidence, and in accordance with applicable law.[5] 33 U.S.C. §921(b)(3), as incorporated by 30 U.S.C. §932(a); O'Keeffe v. Smith, Hinchman &Grylls Assocs., Inc., 380 U.S. 359 (1965).

Appointments Clause

Employer requests the Board vacate the ALJ's Decision and Order and remand the case to be heard by a constitutionally appointed ALJ pursuant to Lucia v. SEC, 585 U.S., 138 S.Ct. 2044 (2018).[6] Employer's Brief at 15-19; Employer's Reply at 5-8. It acknowledges the Secretary of Labor (the Secretary) ratified the prior appointment of all sitting Department of Labor (DOL) ALJs on December 21, 2017,[7] but maintains the ratification was insufficient to cure the constitutional defect in the ALJ's prior appointment. Employer's Brief at 15-19; Employer's Reply at 5-6. We disagree.

An appointment by the Secretary need only be "evidenced by an open, unequivocal act." Marbury v. Madison, 5 U.S. 137, 157 (1803). Ratification "can remedy a defect" arising from the appointment of an official when an agency head "has the power to conduct an independent evaluation of the merits [of the appointment] and does so." Wilkes-Barre Hosp. Co. v. NLRB, 857 F.3d 364, 371 (D.C. Cir. 2017) (internal quotations omitted); see also McKinney v. Ozburn-Hessey Logistics, LLC, 875 F.3d 333, 338 (6th Cir. 2017). It is permissible so long as the agency head: 1) had the authority at the time of ratification to take the action to be ratified; 2) had full knowledge of the decision to be ratified; and 3) made a detached and considered affirmation of the earlier decision. Wilkes-Barre, 857 F.3d at 372; Advanced Disposal Servs. E., Inc. v. NLRB, 820 F.3d 592, 603 (3d Cir. 2016); CFPB v. Gordon, 819 F.3d 1179, 1191 (9th Cir. 2016). Under the "presumption of regularity," courts presume that public officers have properly discharged their official duties, with "the burden shifting to the attacker to show the contrary." Advanced Disposal, 820 F.3d at 603 (citing Butler v. Principi, 244 F.3d 1337, 1340 (Fed. Cir. 2001)).

Congress authorized the Secretary to appoint ALJs to hear and decide cases under the Act. 30 U.S.C. §932a; see also 5 U.S.C. §3105. Under the presumption of regularity, we therefore presume the Secretary had full knowledge of the decision to be ratified and made a detached and considered affirmation. Advanced Disposal, 820 F.3d at 603. Moreover, the Secretary did not generally ratify the appointment of all ALJs in a single letter. Rather, he specifically identified ALJ Morris and gave "due consideration" to his appointment. Secretary's December 21, 2017 Letter to ALJ Morris. The Secretary further stated he was acting in his "capacity as head of [DOL]" when ratifying the appointment of ALJ Morris "as an Administrative Law Judge." Id.

Employer does not assert the Secretary had no "knowledge of all material facts," and generally speculates he did not make a "genuine, let alone thoughtful, consideration" when he ratified the ALJ's appointment. Employer's Reply at 6-7. Employer therefore has not overcome the presumption of regularity.[8] Advanced Disposal, 820 F.3d at 603-04 (mere lack of detail in express ratification is not sufficient to overcome the presumption of regularity); see also Butler, 244 F.3d at 1340. We thus hold the Secretary properly ratified the ALJ's appointment. See Edmond v. United States, 520 U.S. 651, 654-66 (1997) (appointment of civilian members of the United States Coast Guard Court of Criminal Appeals valid where Secretary of Transportation issued a memorandum "adopting" assignments "as judicial appointments of [his] own"); Advanced Disposal, 820 F.3d at 60405 (National Labor Relations Board's retroactive ratification of the appointment of a Regional Director with statement it "confirm[ed], adopt[ed], and ratif[ied] nunc pro tunc" its earlier invalid actions was proper). Consequently, we reject Employer's argument that this case should be remanded for a new hearing before a different ALJ.

Removal Provisions

Employer challenges the constitutionality of the removal protections afforded ALJs. Employer's Brief at 20-22; Employer's Reply Brief at 9-11. It generally argues the removal provisions for ALJs contained in the Administrative Procedure Act (APA), 5 U.S.C. §7521, are unconstitutional, citing Justice Breyer's separate opinion and the Solicitor General's argument in Lucia, 138 S.Ct. 2044. Employer's Brief at 19-21; Employer's Reply Brief at 9-11. In addition, it relies on the United States Supreme Court's holdings in Free Enter. Fund v. Public Co. Accounting Oversight Bd., 561 U.S. 477 (2010), and Seila Law v. CFPB, 591 U.S., 140 S.Ct. 2183 (2020), as well as the opinion of the United States Court of Appeals for the Federal Circuit in Arthrex, Inc. v. Smith &Nephew, Inc., 941 F.3d 1320 (Fed. Cir. 2019), vacated, 594 U.S., 141 S.Ct. 1970 (2021). Employer's Brief at 19-22. For the reasons set forth in Howard v. Apogee Coal Co., BLR, BRB No. 20-0229 BLA, slip op. at 3-5 (Oct. 18, 2022), we reject Employer's arguments.

Responsible Insurance Carrier

Employer does not challenge the ALJ's findings that Apogee is the correct responsible operator and it was self-insured by Arch Coal on the last day Apogee employed Claimant; thus we affirm these findings. See Skrack v. Island Creek Coal Co. 6 BLR 1710, 711 (1983); 20 C.F.R. §§725.494(e), 725.495, 726.203(a); Decision and Order at 1314. In 2005, Arch Coal sold Apogee to Magnum Coal (Magnum), and in 2008 Magnum was sold to Patriot Coal Corporation (Patriot). Director's Brief at 2; Employer's Brief at 28. In 2011, Patriot was authorized to insure itself and its subsidiaries. Director's Brief at 19. Although Patriot's self-insurance authorization made it retroactively liable for the claims of miners who worked for Apogee, Patriot later went bankrupt and can no longer provide for those benefits. Id. at 2, 19. Neither Patriot's self-insurance authorization nor any other arrangement, however, relieved Arch Coal of liability for paying benefits to miners last employed by Apogee when Arch Coal owned and provided self-insurance to that company, as the Director states. Id. at 19-20.

Employer raises several arguments to support its contention that Arch Coal was improperly designated the self-insured carrier in this claim and thus the Black Lung Disability Trust Fund (Trust Fund), not Arch Coal, is responsible for the payment of benefits following Patriot's bankruptcy Employer's Brief at 23-38; Employer's Reply Brief at 11-19. It argues the ALJ erred in finding Arch liable for benefits because: (1) the district director is an inferior officer not properly appointed under the Appointments Clause;[9] (2) the ALJ erroneously excluded its liability evidence; (3) he evaluated Arch Coal's liability for the claim as a responsible operator or commercial insurance carrier rather than as a...

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