DISABLED AMERICAN VETER. v. SEC., VETERANS AFFAIRS, 04-7117

• Decision Date: 03 August 2005
• Docket Number: No. 04-7117,04-7128.,04-7117
• Citation: 419 F.3d 1317
• Parties: DISABLED AMERICAN VETERANS, Petitioner, and The American Legion and the National Veterans Legal Services Program Petitioners, v. SECRETARY OF VETERANS AFFAIRS, Respondent.
• Court: U.S. Court of Appeals — Federal Circuit

419 F.3d 1317

DISABLED AMERICAN VETERANS, Petitioner, and The American Legion and the National Veterans Legal Services Program Petitioners, v. SECRETARY OF VETERANS AFFAIRS, Respondent.

Nos. 04-7117, 04-7128.

United States Court of Appeals, Federal Circuit.

August 3, 2005.

Ronald L. Smith, Disabled American Veterans, of Washington, DC, argued for petitioner Disabled American Veterans. With him on the brief was Donald E. Purcell.

Ana Holmes, Steptoe & Johnson LLP, of Washington, DC, argued for petitioners The American Legion and The National Veterans Legal Services Program. On the brief was Jeffrey E. McFadden. Of counsel on the brief was Barton F. Stichman, National Veterans Legal Services Program, of Washington, DC.

Martin F. Hockey, Jr., Senior Trial Counsel, Commercial Litigation Branch, Civil Division, United States Department of Justice, of Washington, DC, argued for respondent. With him on the brief were Peter D. Keisler, Assistant Attorney General and David M. Cohen, Director. Of counsel were Mark A. Melnick, Assistant Director, and Cristina C. Ashworth, Attorney. Of counsel on the brief were Michael J. Timiniski, Deputy Assistant General Counsel, and Martin J. Sendek, Staff Attorney, United States Department of Veterans Affairs, of Washington, DC.

Before MICHEL, Chief Judge, MAYER and DYK, Circuit Judges.

Opinion for the court filed by Circuit Judge DYK.

Dissenting opinion filed by Circuit Judge MAYER.

DYK, Circuit Judge.

Disabled American Veterans, the American Legion, and the National Veterans Legal Services Program (collectively "petitioners") petition for review of a regulation promulgated by the Secretary of Veterans Affairs, 38 C.F.R. § 20.901(a). We hold that the regulation is valid and accordingly deny the petition for review.

BACKGROUND

This case involves a regulation that authorizes the Board of Veterans Appeals (hereinafter "Board") to secure medical opinions from health care professionals within the Department of Veterans Affairs ("VA"). Some background on the administration of veterans benefits is helpful to understanding the operation of this regulation.

Among the most important of benefit programs administered by the VA is the disability compensation program, which provides compensation to veterans who suffer a "disability resulting from personal injury suffered or disease contracted in line of duty." 38 U.S.C. § 1110 (2000). A veteran claiming benefits submits an application to the VA, and an initial decision on benefits is rendered by the Secretary of Veterans Affairs ("Secretary") under 38 U.S.C. § 511(a). As a practical matter the initial decision is usually made by the Secretary's delegate at the regional office under the authority of 38 C.F.R. § 3.100. The entity that renders the initial decision is known as the "agency of original jurisdiction," 38 C.F.R. § 20.3(a) (2004), but for convenience we will refer to it as the regional office.

Generally, a veteran who claims entitlement to disability compensation benefits must show (1) a current disability; (2) an in-service precipitating disease, injury or event; and (3) nexus between the current disability and the in-service events. See Epps v. Gober, 126 F.3d 1464, 1468 (Fed.Cir.1997); see also Shedden v. Principi, 381 F.3d 1163, 1167 (Fed.Cir.2004) (presumption that an injury incurred during active duty is service-connected). Medical evidence and medical opinion is important to the questions of whether there is a disability and whether that disability is service-connected.

Recognizing the importance of such medical evidence and opinion, Congress specifically vested the VA with a duty to provide a medical examination and to obtain a medical opinion "when such an examination or opinion is necessary to make a decision on the claim." 38 U.S.C. § 5103A(d) (2000). The statute deems medical evidence and opinion to be necessary when the record "contains competent evidence that the claimant has a current disability . . ., indicates that the disability or symptoms may be associated with the claimant's active ... service" and "does not contain sufficient medical evidence for the Secretary to make a decision on the claim." Id. Thus, when necessary to the making of an initial determination on a claim, the VA is generally required by statute to make reasonable efforts to obtain relevant medical records, to provide medical examinations, and to secure medical opinions.

The Board is an appellate body within the VA that reviews initial decisions made under 38 U.S.C. § 511. "Decisions of the Board are based on the entire record." 38 U.S.C. § 7104(a) (2000). As we have noted, the Board conducts de novo review of regional office proceedings based on the record. See Donovan v. West, 158 F.3d 1377, 1381 (Fed.Cir.1998). The Board decides approximately 35,000 to 40,000 cases per year.

In a departure from the Board's primary function as an appellate body, VA regulations have since the early 1960s allowed the Board to secure medical opinions from within the VA from the Chief Medical Director (now the Under-Secretary of Health). In 1999, the Board obtained 482 medical opinions from the Chief Medical Director. The securing of such opinions by the Board avoids a remand.

The regulation permitting the obtaining of medical opinions from the Chief Medical Director was first adopted in 1964,¹ but the practice has existed since at least 1962. The regulation was renumbered and several minor amendments were made over the next 35 years.² In 2001, the present, somewhat broader regulation was adopted as an interim final rule, but the Secretary invited comments concerning the proposed final rule. 66 Fed.Reg. 38158, 38159 (July 23, 2001). After receiving comments, the interim final rule was adopted as the final rule without any change in the text. 69 Fed.Reg. 19935, 19937 (Apr. 15, 2004). The regulation states:

Opinion from the Veterans Health Administration. The Board may obtain a medical opinion from an appropriate health care professional in the Veterans Health Administration of the Department of Veterans Affairs on medical questions involved in the consideration of an appeal when, in its judgment, such medical expertise is needed for equitable disposition of an appeal.

38 C.F.R. § 20.901(a) (2004). The regulations also provide that the veteran must be furnished with a copy of the opinion and given 60 days to respond. 38 C.F.R. § 20.903(a) (2004). In the final rule, the Secretary cited 38 U.S.C. §§ 5103A and 7109 as authority for the regulation. 38 C.F.R. § 20.901(a) (2004).

Petitioners contend that 38 C.F.R. § 20.901(a) is invalid because it is contrary to the appellate function of the Board and the "one review on appeal" requirement of 38 U.S.C. § 7104(a). We have jurisdiction pursuant to 38 U.S.C. § 502.

DISCUSSION

I

There is no doubt that the challenged regulation does allow the Board to consider evidence that was not before the regional office as an original matter. Nor is there any doubt that the Board generally functions in an appellate capacity.

The Board was first established by Executive Order and then by statute in 1946. Act of June 22, 1946, ch. 448, 60 Stat. 299. Its functions were codified into statute by the Veterans Benefits Act of 1957, Pub.L. No. 85-56, 71 Stat. 83. As described in Bates v. Nicholson, 398 F.3d 1355, 1363-64 (Fed.Cir.2005), the Board's existence and performance of an appellate function long predated judicial review of veterans claims, which was not provided until 1988. See Veterans' Judicial Review Act, Pub.L. No. 100-687, 102 Stat. 4105 (1988).

Incorporating the prior regulation, section 1304(a) of the Veterans' Benefits Act of 1957 provided that:

All questions on claims involving benefits under the laws administered by the Veterans' Administration shall be subject to one review on appeal to the Administrator. Final decisions on such appeals shall be made by the Board.

Veterans' Benefits Act § 1304(a), 71 Stat. at 128. This provision has been subject to only minor amendments, and currently appears at 38 U.S.C. § 7104(a), which provides, in pertinent part:

All questions in a matter which under section 511(a) of this title is subject to decision by the Secretary shall be subject to one review on appeal to the Secretary. Final decisions on such appeals shall be made by the Board. Decisions of the Board shall be based on the entire record in the proceeding.

(emphasis added). As we held in Disabled American Veterans v. Secretary of Veterans Affairs, 327 F.3d 1339, 1346-47 (Fed. Cir.2003) ("DAV I"), this "one review on appeal" provision of section 7104(a) generally bars the Board from considering new evidence that was not before the regional office.

In DAV I, the petitioner challenged the validity of 38 C.F.R. § 19.9(a)(2) (2002), which provided:

If further evidence . . . or any other action is essential for a proper appellate decision, a Board Member or panel of Members may . . . direct Board personnel to undertake the action essential for a proper appellate decision.

We held that § 19.9(a)(2) was "inconsistent with 38 U.S.C. § 7104(a), because § 19.9(a)(2) denies appellants `one review on appeal to the Secretary' when the Board considers additional evidence." DAV I, 327 F.3d at 1347. However, in DAV I we also noted that there were several exceptions where "Congress has provided express statutory authority to permit the Board to obtain additional evidence, such as expert medical opinions in specific cases." Id.³

II

The government argues that 38 U.S.C. § 7109, relied on by the Secretary as authority for promulgating the regulation, creates the necessary exception to the "one review on appeal" rule in section 7104. The government also argues that, even if the statutory authority is ambiguous, deference should be given to the Secretary's interpretation of the statute under Chevron U.S.A. Inc. v. Natural Resources Defense Council. Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984). We conclude that the...