Hudgens v. McDonald
| Decision Date | 18 May 2016 |
| Docket Number | No. 2015–7030.,2015–7030. |
| Citation | 823 F.3d 630 |
| Parties | Michael A. HUDGENS, Claimant–Appellant v. Robert A. McDONALD, Secretary of Veterans Affairs, Respondent–Appellee. |
| Court | U.S. Court of Appeals — Federal Circuit |
Thomas Edward Andrews III, Andrews Law Office LLC, Columbia, SC, argued for claimant-appellant.
Igor Helman, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, DC, argued for respondent-appellee. Also represented by Benjamin C. Mizer, Robert E. Kirschman, Jr., Martin F. Hockey, Jr., Courtney D. Enlow; David J. Barrans, Amanda Blackmon, Office of General Counsel, United States Department of Veterans Affairs, Washington, DC.
Before O'MALLEY, PLAGER, and WALLACH, Circuit Judges.
Mr. Hudgens appeals from the judgment of the Court of Appeals for Veterans Claims (“Veterans Court”). That court (1) held that Mr. Hudgens is not entitled to compensation for his prosthetic knee replacement under 38 C.F.R. § 4.71a, Diagnostic Code 5055 (“DC 5055”); (2) vacated and remanded the decision of the Board of Veterans' Appeals (“Board”) denying Mr. Hudgens a disability rating of greater than 10 percent for degenerative joint disease in the right knee; (3) vacated and remanded the decision of the Board denying entitlement to a compensable disability rating for instability in the right knee for a prior time period; and (4) remanded to the Board for a determination of whether Mr. Hudgens's partial knee replacement can be rated by analogy to DC 5055. Hudgens v. Gibson, 26 Vet.App. 558 (2014). The issue before us on appeal is whether Mr. Hudgens is entitled to compensation for his prosthetic knee replacement under DC 5055. For the reasons below, we reverse and remand for further proceedings consistent with this opinion.
Mr. Hudgens injured his right knee while serving on active duty in the U.S. Army. Joint Appendix (“JA”) 2. In 2003, Mr. Hudgens had partial knee replacement surgery on his right knee. Id. On August 16, 2006, Mr. Hudgens sought benefits with the Department of Veterans Affairs (“VA” or “Secretary”) for his service-connected knee injury. JA 105.
Mr. Hudgens filed claims for (1) degenerative joint disease in the right knee; (2) instability in the right knee; and later (3) an evaluation for his prosthetic knee replacement. On December 29, 2006, the VA Regional Office (“RO”) granted Mr. Hudgens's claim for benefits based on his degenerative joint disease of the right knee and assigned a 10 percent evaluation. JA 105. On September 28, 2007, Mr. Hudgens filed a claim for an increased evaluation for instability in his right knee. JA 260. On November 21, 2007, the RO assigned an additional 10 percent evaluation for Mr. Hudgens's instability in his right knee. JA 260, 263.
On February 3, 2009, after receiving the results of Mr. Hudgens's then-recent VA orthopedic exam, the RO reduced the rating for Mr. Hudgens's right knee instability from 10 to 0 percent. JA 267. The RO still continued the previously assigned 10 percent evaluation for degenerative joint disease. JA 266. After filing a second claim for increased evaluation of his knee instability and having it denied by the RO on April 22, 2009, Mr. Hudgens filed a Notice of Disagreement. JA 275. Mr. Hudgens underwent another VA orthopedic exam, but the RO again found that the 0 percent evaluation for right knee instability was warranted. JA 288.
On March 16, 2010, Mr. Hudgens filed a second Notice of Disagreement, this time arguing that he should be awarded 100 percent evaluation for his prosthetic knee replacement under DC 5055. Under the heading “Prosthetic Implants” DC 5055 states:
On March 31, 2010, the RO denied the increase in evaluation, finding that DC 5055 applied only to total knee replacements, not partial knee replacements. JA 305.
Mr. Hudgens appealed the RO's rating decisions to the Board. JA 70. On December 26, 2012, the Board denied Mr. Hudgens: (1) a disability rating of greater than 10 percent for degenerative joint disease of the right knee; (2) a disability rating of greater than 10 percent for instability in the right knee; and (3) entitlement to a compensable disability rating for instability in the right knee for the time period between the two VA orthopedic exams. JA 79. The Board additionally concluded that DC 5055 does not apply to Mr. Hudgens because he “underwent only a ‘partial’ knee replacement, and not the total prosthetic replacement of the knee joint contemplated [by DC 5055].” JA 77. The Board did not address whether DC 5055 can be applied to Mr. Hudgens by analogy. Id.
On January 30, 2013, Mr. Hudgens appealed the Board's decision to the Veterans Court. JA 16. Mr. Hudgens argued that the Board erred in finding that DC 5055 does not apply to partial knee replacements. Hudgens, 26 Vet.App. at 560. The Veterans Court disagreed. Id. at 565. In rendering its decision, the Veterans Court considered the plain meaning of the term “knee joint” in DC 5055. Id. at 561. After looking to a medical dictionary for guidance, the Veterans Court concluded that DC 5055 is unambiguous and applies to the prosthetic replacement of the whole knee joint, which must include all three components of the knee. Id. The Veterans Court also concluded that such a definition was “consistent with the overall statutory scheme.” Id. In particular, the Veterans Court looked to a related regulation, DC 5054, which addresses prosthetic hip replacements. Hudgens, 26 Vet.App. at 561. The Veterans Court reasoned that, since DC 5054 explicitly includes language relating to a partial hip replacement, the VA Secretary “knew how to provide benefits for a prosthesis replacing part of a joint, as opposed to the entire joint, when he intended to.” Id. Finally, because the Veterans Court found DC 5055 to be unambiguous, it was not swayed by the fact that the majority of prior Board decisions were inconsistent with the Veterans Court's current interpretation of this regulation. Id. at 562–63.
After disposing of this interpretive issue, the Veterans Court remanded several of Mr. Hudgens's other claims to the Board. Id. at 565. The Veterans Court asked the Board to address whether Mr. Hudgens's partial knee replacement can be rated by analogy to DC 5055.1 Id. at 564. The Veterans Court also vacated the Board's decision on the issues of right knee instability and degenerative joint disease, remanding these matters to the Board for further adjudication. Hudgens, 26 Vet.App. at 565. Specifically, the Veterans Court found that the Board “failed to address the evidence of right knee dislocation, swelling, and pain or explain why they are not evidence of ‘cartilage, semilunar, removal of, symptomatic.’ ” Id. at 564–65 (citing DC 5259).
Chief Judge Kasold dissented with respect to the majority's holding that DC 5055 does not apply to partial knee replacements, finding the regulation to be ambiguous. Id. (Kasold, C.J., dissenting).
In particular, Chief Judge Kasold pointed out that the majority of Board decisions to address DC 5055 had found that the regulation does apply to partial knee replacements. Id. In addition, Chief Judge Kasold argued that, in view of the inconsistent interpretation of the regulation by the agency, the Secretary's current interpretation does not warrant deference. Id. at 567. Instead, Chief Judge Kasold insisted that the ambiguity “be interpreted in the light most favorable to the veteran.” Id. (citing, inter alia, Brown v. Gardner, 513 U.S. 115, 118, 115 S.Ct. 552, 130 L.Ed.2d 462 (1994) ).
On July 17, 2014, Mr. Hudgens filed a motion for reconsideration regarding the Veterans Court's interpretation of DC 5055. Hudgens v. McDonald, No. 13–0370, 2014 WL 5325233, at *1, 2014 U.S.App. Vet. Claims LEXIS 1769, at *1 (Vet.App. Oct. 20, 2014). On October 20, 2014, the Veterans Court denied the motion, with Chief Judge Kasold again dissenting. Id. at *1–2, 2014 U.S.App. Vet. Claims LEXIS 1769, at *3. Mr. Hudgens timely appealed to this court.
On July 16, 2015, twelve days before the Secretary's final brief was due with this court, the VA published a final informal rule relevant to this litigation. Appellant Reply Br. at 1 (). The regulation explains that “[i]n view of the ... VA's longstanding interpretation, VA is amending its regulations to clarify that the language of § 4.71a, Prosthetic Implants, which refers to replacement of the named joint, refers to replacement of the joint as a whole, except where it is otherwise stated under DC 5054.” Agency Interpretation at 42,040 –41.
“We have the authority to decide all relevant questions of law and can set aside a regulation or an interpretation of a regulation relied upon by the Court of Appeals for Veterans Claims when we find it to be arbitrary, capricious, and an abuse of discretion, or otherwise not in accordance with law; contrary to constitutional right, power, privilege, or immunity; in excess of statutory jurisdiction, authority, or limitations, or in violation of a statutory right; or without observance of procedure required by law.” Bustos v. West, 179 F.3d 1378, 1380 (Fed.Cir.1999) ; see 38 U.S.C. § 7292(d)(1). “We review statutory and regulatory interpretations of the Veterans Court de novo. ” Johnson v. McDonald, 762 F.3d 1362,...
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