Dyer v. Cenex Harvest States Co-Op.

• Decision Date: 01 May 2009
• Docket Number: No. 07-73549.,07-73549.
• Citation: 563 F.3d 1044
• Parties: Rex DYER, Petitioner, v. CENEX HARVEST STATES COOPERATIVE; Director, Office of Workers' Compensation Programs, Respondents.
• Court: U.S. Court of Appeals — Ninth Circuit

563 F.3d 1044

Rex DYER, Petitioner, v. CENEX HARVEST STATES COOPERATIVE; Director, Office of Workers' Compensation Programs, Respondents.

No. 07-73549.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted November 17, 2008.

Filed May 1, 2009.

Charles Robinowitz, Portland, OR, Joshua Thomas Gillelan II (argued), Longshore Claimants' National Law Center, Washington, DC, for the petitioner.

John Randall Dudrey (argued), Williams Fredrickson, Portland, OR; Michael Niss, Mark A. Reinhalter, Rita Ann Roppolo, U.S. Department of Labor, Thomas Shepard, Benefits Review Board, Washington, DC, Karen P. Staats, OWCP Longshore and Harbor Workers Programs, Seattle, WA, for the respondents.

On Petition for Review of an Order of the Office of Workers' Compensation Programs. OWCP No. 07-0164.

Before: W. FLETCHER and RAYMOND C. FISHER, Circuit Judges, and JOHN M. ROLL, District Judge.¹

WILLIAM A. FLETCHER, Circuit Judge:

Rex Dyer prevailed in a workers' compensation claim under the Longshore and Harbor Workers' Compensation Act ("LHWCA"). Dyer then sought attorney's fees pursuant to Section 28(a) of the LHWCA, 33 U.S.C. § 928(a). The Benefits Review Board ("BRB") held that Dyer was entitled to recover only those attorney's fees incurred after his employer, Cenex Harvest States Cooperative ("Cenex"), refused to pay his claim. The BRB held that Dyer was not entitled to recover attorney's fees for the period between his injury and Cenex's refusal. In the jargon of this area of the law, the BRB allowed attorney's fees for the "post-controversion" period but denied fees for the "pre-controversion" period. In addition, the BRB affirmed the District Director's reduction of Dyer's lawyer's requested hourly rate from $350 to $235. Dyer petitions for review in this court.

We hold that Dyer is entitled to both pre- and post-controversion attorney's fees. We do not decide the proper hourly rate for Dyer's attorney. We vacate and remand to the BRB so that it may decide that question under the principles we recently articulated in Christensen v. Stevedoring Services of America, 557 F.3d 1049 (9th Cir.2009), and Van Skike v. Director, OWCP, 557 F.3d 1041 (9th Cir.2009).

I. Factual and Procedural Background

On May 3, 2005, Dyer filed a claim for hearing loss under the LHWCA against Cenex and its workers' compensation insurance carrier, Liberty Mutual Insurance Company. See 33 U.S.C. § 908(c)(13). On June 23, 2005, Cenex received notice of Dyer's claim. On June 30, 2005, Cenex contested—or "controverted"—liability and refused to pay. On June 27, 2006, the parties entered into a settlement agreement under which Dyer was awarded a settlement of $33,497.57. The settlement provided that Dyer's attorney was entitled to reasonable attorney's fees and costs under the LHWCA. An Administrative Law Judge from the Office of Workers' Compensation Programs ("OWCP") approved the agreement.

On July 26, 2006, Dyer's attorney submitted an application for attorney's fees to the OWCP. He sought fees from January 31, 2005, when he first began representing Dyer, through July 10, 2006, the date of the fee request. Cenex objected to paying attorney's fees incurred prior to June 30 2005, the date of controversion. The OWCP's District Director ruled in favor of Cenex. The BRB affirmed in an unpublished order, holding that 33 U.S.C. § 928(a) authorizes payment of attorney's fees only for services performed after controversion.

We heard oral argument on Dyer's petition for review on November 17, 2008. After argument, we requested that the Director of OWCP file a brief advising us of his position on pre-controversion attorney's fees under § 928(a). The Director has now filed a brief, and the parties have had an opportunity to respond.

II. Standard of Review

We review the BRB's rulings "for errors of law and adherence to the substantial evidence standard." Hurston v. Dir., OWCP, 989 F.2d 1547, 1548 (9th Cir.1993) (internal quotation marks omitted). Because the BRB is not a policy-making body, we give no special deference to its interpretations of the LHWCA. See Potomac Elec. Power Co. v. Dir., OWCP, 449 U.S. 268, 278 n. 18, 101 S.Ct. 509, 66 L.Ed.2d 446 (1980). However, we "accord `considerable weight' to the construction of the [LHWCA] urged by the Director of the Office of Workers' Compensation Programs, as he is charged with administering it." Hunt v. Dir., OWCP, 999 F.2d 419, 421 (9th Cir.1993). "Where the relevant statute or statutes are `easily susceptible to the Director's interpretation, we need go no further.'" Id.

III. Discussion

A. Legal Background

The LHWCA, 33 U.S.C. §§ 901-950, was enacted in 1927 to provide "compensation for employees injured while working on the navigable waters or adjoining land areas of the United States." Day v. James Marine, Inc., 518 F.3d 411, 414 (6th Cir.2008). As originally enacted, the LHWCA followed the American rule on attorney's fees, which requires litigants to pay their own attorney's fees whether they win or lose. See id.; Dir., OWCP v. Robertson, 625 F.2d 873, 876-77 (9th Cir.1980). In 1972, the LHWCA was amended to provide that under certain circumstances employers must pay "a reasonable attorney's fee" to a successful claimant. 33 U.S.C. § 928.

The LHWCA provides that a successful claimant is entitled to recover attorney's fees from his or her employer in two situations: (1) when the employer denies liability out-right, id. § 928(a); and (2) when the employer accepts liability and pays or tenders some compensation, but a controversy develops over additional compensation, id. § 928(b). Dyer seeks attorney's fees under § 928(a).

Section 928(a) provides for attorney's fees as follows:

If the employer or carrier declines to pay any compensation on or before the thirtieth day after receiving written notice of a claim for compensation having been filed from the deputy commissioner, on the ground that there is no liability for compensation within the provisions of this chapter and the person seeking benefits shall thereafter have utilized the services of an attorney at law in the successful prosecution of his claim, there shall be awarded, in addition to the award of compensation, in a compensation order, a reasonable attorney's fee against the employer[.]

(emphasis added).

Section 928(b) provides in part:

If the employer or carrier pays or tenders payment of compensation without an award pursuant to section 914(a) and (b) of this title, and thereafter a controversy develops over the amount of additional compensation, [and if the deputy commissioner or Board recommends additional compensation, the employer shall pay or tender that additional amount.] If the employee refuses to accept such payment or tender of compensation, and thereafter utilizes the services of an attorney at law, and if the compensation thereafter awarded is greater than the amount paid or tendered by the employer or carrier, a reasonable attorney's fee based solely upon the difference between the amount awarded and the amount tendered or paid shall be awarded in addition to the amount of compensation.

(emphasis added).

Section 928(d) provides in part:

The amounts awarded against an employer or carrier as attorney's fees, costs, fees and mileage for witnesses shall not in any respect affect or diminish the compensation payable under this chapter.

Regulations implementing § 928, promulgated by the Director of OWCP, essentially repeat the statutory language. See 20 C.F.R. § 702.134.

The attorney's fees provisions of the LHWCA have been incorporated into the Black Lung Benefits Act ("BLBA"), 30 U.S.C. §§ 901-944. See 30 U.S.C. § 932(a) (incorporating 33 U.S.C. § 928). The Secretary of Labor has broad discretion under the BLBA to depart from the LHWCA by promulgating BLBA-specific regulations. See id. That discretion has been delegated to the Director of OWCP. In 2000, the Director of OWCP promulgated regulations under the BLBA that explicitly provide that a prevailing claimant is entitled to pre-controversion attorney's fees. See 20 C.F.R. § 725.367.

B. Discussion

Section 928(a) imposes four conditions that must be satisfied in order to receive attorney's fees: (1) the claimant must file a claim with the Deputy Commissioner of OWCP; (2) the employer must receive notice of the claim from the Deputy Commissioner; (3) the employer must decline to pay compensation or not respond within 30 days; and (4) the claimant must "thereafter" utilize the services of an attorney to prosecute his claim. Day, 518 F.3d at 414. The parties agree without qualification that Dyer has met the first three conditions.

The parties also agree that Dyer has met the fourth condition, in that Cenex "declined to pay compensation" and that Dyer "thereafter" employed an attorney. But they disagree as to the amount of attorney's fees Dyer is entitled to recover. The source of their dispute, and the issue in this case, is the meaning of "thereafter" in § 928(a).

Dyer contends that the word "thereafter" requires only that he have employed an attorney after Cenex declined to pay. Once that condition was satisfied, Dyer contends, he became entitled to all reasonable fees paid to that attorney in connection with the prosecution of his claim. Cenex contends, however, that the word "thereafter" operates in two ways. First, Cenex contends (and Dyer agrees) that it requires that Dyer have employed an attorney after Cenex declined to pay. Second, Cenex contends that it limits the amount of attorney's fees to services performed after Cenex declined to pay.

For the reasons that follow, we hold that "thereafter" means only that the claimant must employ an attorney after the employer declines to pay the claim. That is, we hold that a successful claimant is entitled to both pre- and post-controversion attorney's fees.

"The starting point for our interpretation of a statute is always its language." Tahara v. Matson Terminals, Inc., 511 F.3d 950, 953 (9th Cir.20...