The opinion
UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 05-2418
NEWPORT NEWS SHIPBUILDING AND DRY DOCK
COMPANY,
Petitioner,
versus
DIRECTOR, OFFICE OF WORKERS’ COMPENSATION
PROGRAMS; WILLIE M. RICHARDSON,
Respondents.
On Petition for Review of an Order of the Benefits Review Board.
(05-0151)
Argued: May 22, 2007 Decided: August 14, 2007
Before WILLIAMS, Chief Judge, GREGORY, Circuit Judge, and Benson E.
LEGG, Chief United States District Judge for the District of
Maryland, sitting by designation.
Petition for review denied; Board order affirmed by unpublished
opinion. Judge Gregory wrote the opinion, in which Chief Judge
Williams and Judge Legg joined.
ARGUED: Jonathan Henry Walker, MASON, MASON, WALKER & HEDRICK,
P.C., Newport News, Virginia, for Petitioner. Matthew W. Boyle,
UNITED STATES DEPARTMENT OF LABOR, Washington, D.C.; Matthew Harley
Kraft, RUTTER & MILLS, L.L.P., Norfolk, Virginia, for Respondents.
ON BRIEF: Howard M. Radzely, Solicitor of Labor, Allen H. Feldman,
Associate Solicitor, Mark A. Reinhalter, Counsel for Longshore,
UNITED STATES DEPARTMENT OF LABOR, Washington, D.C., for Respondent
Director, Office of Workers’ Compensation Programs. Jennifer W.
Vincent, PATTEN, WORNOM, HATTEN & DIAMONSTEIN, L.C., Newport News,
Virginia, for Respondent Willie M. Richardson.
Unpublished opinions are not binding precedent in this circuit.
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GREGORY, Circuit Judge:
Newport News Shipbuilding and Dry Dock Company (“Newport
News”) contests a benefits award granted, under the Longshore and
Harbor Workers’ Compensation Act, 33 U.S.C. §§ 901-950, (“the
Act”), to Willie M. Richardson by the Workers’ Compensation
Benefits Review Board (“Board”). Newport News argues that the
Board should not have approved the Administrative Law Judge’s
(“ALJ”) award of benefits for Richardson’s chronic obstructive
pulmonary disorder (“COPD”) because Section 33(g) of the Act
prohibits benefits for a person who has previously settled, without
employer approval, with a third party for injuries related to the
same disability. Newport News claims that Richardson’s unapproved
settlement for asbestosis in 1999 should bar his current claim for
COPD benefits because he suffers from only one lung-impairing
disability. For the reasons stated below, we deny the petition and
affirm the award of benefits.
I.
Richardson worked at Newport News as a welder from 1968 until
late 1998. Throughout his career, he was exposed to fumes and dust
from the several different types of welding metals. He also used
asbestos material to protect himself while welding until the early
eighties. For four years of his career, he welded in a shipyard
that was filled with toxic fumes from a banned paint that was
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applied to and then removed from a ship. Throughout the eighties
and nineties, Richardson had difficulty breathing when performing
light activity, but in late 1998 his dyspnea increased to the point
where he had to leave work. Richardson also has a history of
childhood asthma.
Richardson applied for disability benefits on February 16,
1995. In his first application, he claimed that he suffered from
asbestos-related lung disease contracted from his inhaling asbestos
fibers at work. No action was taken on his application. On
February 9, 1999, Richardson filed a second application for
benefits, claiming that he suffered from COPD, a condition that he
contracted by inhaling welding dust and paint fumes at work. Also
in 1999 Richardson negotiated settlements of $112 and $6,500, from
Forty-Eight Insulations and Babcock & Wilcox respectively, for
asbestos-related illness. Richardson did not receive written
approval from Newport News before reaching those settlements.
Richardson’s two disability claims were consolidated for
hearing on July 18, 2000. At the hearing, the ALJ granted
Richardson’s motion to amend his claim to seek benefits related
only to his COPD and ask for medical monitoring related to asbestos
exposure. Richardson’s doctors had determined that he did not
suffer from asbestosis, but they wanted to make sure that it would
not develop in the future. After the hearing, the ALJ allowed the
parties to conduct more depositions of experts and enter them into
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evidence. In an order dated January 30, 2003, the ALJ ruled that
Section 33(g) of the Act barred Richardson from recovery because he
suffered from a lung disability that included asbestosis, the very
disability that was the subject of the earlier, unapproved third-
party settlements:
I find that the preponderance of the evidence establishes
that the Claimant suffers from asbestosis, asbestos
related pleural plaques, and has both restrictive and
obstructive lung impairment. . . . I also find that all
of these conditions contribute at least to some degree to
the Claimant’s impaired lung functioning and combine with
his pre-existing asthma. The result is that the Claimant
suffers from a single disability caused by his
simultaneous exposure to asbestos fibers, smoke, dust,
and fumes while welding.
J.A. 885. Upon finding his claim barred, Richardson appealed to
the Board.
The Board reversed the order of the ALJ based on its
interpretation of Chavez v. Todd Shipyards Corp., 139 F.3d 1309
(9th Cir. 1998). In Chavez the Ninth Circuit deferred to the
Benefits Review Board Director’s understanding of the third-party
settlement rule, which provided that a claimant who has settled
with a third party on the basis of injuries produced by one
disability will not be barred from collecting benefits from the
employer on the basis of a second, separate disability. Id. at
1312. The Board instructed the ALJ in its order:
If, after reviewing the medical evidence in light of
Chavez, the administrative law judge again finds that the
claimant is disabled by both asbestosis and COPD, Section
33(g) cannot bar the claim because, under the aggravation
rule, COPD is considered to be the disabling, compensable
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condition and therefore not the same disability for which
claimant settled his third party claims.
J.A. 893. With this instruction, the ALJ reviewed the evidence,
found that Richardson suffered from COPD as well as asbestosis, and
awarded him permanent partial disability benefits. (J.A. 912.)
Newport News asks us to reverse the Board’s affirmation of the
ALJ’s second order.
II.
This Court reviews the Board’s conclusions of law de novo.
Newport News Shipbuilding & Dry Dock Co. v. Tann, 841 F.2d 540, 542
(4th Cir. 1988). We will uphold the ALJ’s findings of fact if they
are supported by substantial evidence. Id. at 543. Therefore, in
evaluating Newport News’s appeal, we must confront two questions.
We must first ask if the Board interpreted the Act correctly. Then
we must decide if substantial evidence supports the ALJ’s findings
of fact.
A.
The Act states that employers shall be liable to claimants for
“compensation for either disability or death resulting from an
injury occurring in the course of maritime employment.” Brown &
Root, Inc. v. Sain, 162 F.3d 813, 816 (4th Cir. 1998); see 33
U.S.C. § 903(a). The Act defines disability as “incapacity because
of injury to earn the wages which the employee was receiving at the
time of injury in the same or any other employment.” 33 U.S.C. §
6
902(10). It defines injury as “accidental injury or death arising
out of and in the course of employment, and such occupational
disease or infection as arises naturally out of such employment or
as naturally or unavoidably results from such accidental injury.”
33 U.S.C. § 902(2). The Supreme Court has defined “person entitled
to compensation” in Section 33(g) as a person who would be eligible
for benefits whether or not he or she is currently receiving
benefits. Estate of Cowart v. Nicklos Drilling Co., 505 U.S. 469,
477 (1992).
Section 33(g) of the Act requires claimants to secure written
approval from their employers when they negotiate settlements with
third parties and when the basis for the settlement is the
disability for which the employer might be liable under the Act.
If claimants do not get this written approval, then they can
receive no compensation for the disability at issue. The section
provides in relevant part:
(1) If the person entitled to compensation . . . enters
into a settlement with a third person . . . for an amount
less than the compensation to which the person . . .
would be entitled under this chapter, the employer shall
be liable for compensation as determined under subsection
(f) of this section only if written approval of the
settlement is obtained from the employer and the
employer’s carrier, before the settlement is executed,
and by the person entitled to compensation. . . .
(2) If no written approval of the settlement is obtained
and filed as required in paragraph (1), or if the
employee fails to notify the employer of any settlement
obtained from or judgment rendered against a third
person, all rights to compensation and medical benefits
under this chapter shall be terminated, regardless of
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whether the employer or the employer’s insurer has made
payments or acknowledged entitlement to benefits under
this chapter.
33 U.S.C. § 933(g). The point of this “written approval
requirement [is to] prevent[] the claimant from acting unilaterally
to the detriment of the employer by accepting less in settlement
than it might be entitled to and thus reducing the employer’s
offset.” I.T.O. Corp. v. Sellman, 954 F.2d 239, 242 (4th Cir.
1992).
The Board instructed the ALJ to follow the reasoning of Chavez
v. Todd Shipyards Corp., 139 F.3d. 1309 (9th Cir. 1309). Chavez
held that “apportionments of the employer’s credit relative to
third party settlements is unavailable where settlement proceeds
are for injuries different from that upon which the compensation
claim is based.” Id. at 1312. In other words, if the claimant has
two disabilities and has only settled with the third party for
injuries related to one of the disabilities, then the employer
still is liable for benefits based on the second disability.
This Court has approved this rationale. In Brown & Root, we
ruled that the claimant, Sain, was a “person entitled to
compensation” twice for two distinct disabilities, even though they
both arose from the same source: “Although both asbestosis and
mesothelioma are caused by exposure to asbestos, they are distinct
diseases giving rise to distinct disabilities (albeit with similar
symptoms) for which Sain could, and apparently did, bring separate
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LHWCA claims.” Brown & Root, 162 F.3d at 817. We found that Sain
could collect compensation for his mesothelioma despite having
settled with third parties for his asbestosis. Id. at 818.
The Board has interpreted the law correctly in this case.
Congress designed Section 33(g) to prevent injured employees from
recovering double damages for their disabilities from both their
employers and third parties. The section protects an employer from
having to pay for an injury for which someone else has already
paid, at least in part. If an employee suffers from distinct
injuries creating distinct disabilities, then Section 33(g) will
only protect the employer from having to provide benefits for the
specific disability that was the basis for the settlement obtained
without the employer’s approval. Because we have followed the
rationale of both the Board and Chavez in Brown & Root, then the
Board was correct to instruct the ALJ that Newport News could only
invoke Section 33(g) protection if asbestosis was Richardson’s only
disability. Newport News should not be protected if Richardson
also suffers from COPD or a distinct pulmonary disability.
Newport News asks us to reverse the Board and the ALJ because
Richardson suffers only from one disability linked to several
causes. The company argues that the term disability is an economic
construct that defines an inability to earn wages and is only
tangentially related to the underlying injury. It believes that
the Court should understand Richardson’s disability as his
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inability to work at Newport News because of lung ailments, all of
which are related in part to asbestos and for which Richardson was
already compensated in an unapproved settlement.
Newport News’s argument cannot stand in the face of our
precedent. In Brown & Root, we recognized that the concept of
disability is inextricably linked to the injury that causes it. We
also recognized that one claimant can suffer two disabilities, even
if those disabilities affect the same organ system and have similar
symptoms. If Richardson suffers from both asbestosis and COPD,
then he can be compensated for the COPD.
B.
Whether the ALJ’s findings that Richardson suffered from both
asbestosis and COPD are supported by substantial evidence is a more
difficult question. After taking evidence in a hearing and in
post-hearing depositions, the ALJ originally concluded (despite
Richardson’s withdrawal of his claim for asbestosis): “I find that
the preponderance of the evidence establishes that the Claimant
suffers from asbestos, asbestos related pleural plaques, and has
both restrictive and obstructive lung impairment.” The ALJ then
ruled that “all of these conditions contribute at least to some
degree to the Claimant’s impaired lung functioning and combine with
his pre-existing asthma. The result is that the Claimant suffers
from a single disability caused by his simultaneous exposure to
asbestos fibers, smoke, dust, and fumes while welding.” J.A. 885.
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After the Board reversed the order, the ALJ made new findings
of fact. One of those findings included “that Claimant has
established by a preponderance of the evidence that his obstructive
lung disability is causally linked to his working conditions.”
J.A. 907. The ALJ maintained that Richardson had proven that he
was disabled by asbestosis, pleural plagues, and restrictive and
obstructive lung impairment, but understood the lung impairment to
be distinct from the asbestosis, and ruled that Richardson’s COPD
claim was not barred by Section 33(g). J.A. 911-12.
During the hearing, the ALJ heard evidence about Richardson’s
condition from several doctors and lung specialists and received
several medical records into evidence. Dr. James P. Baker, a
pulmonologist who treated Richardson throughout 1999, testified
that Richardson suffered from shortness of breath related to
“significant exposure to a number of volatile materials, plus
asbestos.” J.A. 56, 60. Baker could not diagnose Richardson with
asbestosis but admitted that he had lung abnormalities. His final
diagnosis was that “Mr. Richardson has both restrictive and
obstructive abnormality in his lung function.” J.A. 73. He also
diagnosed him with bronchiectasis, “a condition which occurs when
part of the airway passage is damaged by something.” Id.
Dr. Joseph C. Ross, who is board certified in internal
medicine and pulmonary disease, testified as an expert for Newport
News. Ross had never examined Richardson, but he reviewed his
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medical records. Ross concluded that Richardson had “pretty mild”
lung impairment. J.A. 157. He disagreed that Richardson had
either restrictive or obstructive lung disease but admitted that he
had restricted air flow and obstructive airways. On cross-
examination, Dr. Ross admitted that he was not a specialist in
occupational lung disease and that he had last treated patients in
1989. Richardson also admitted into evidence a letter from Newport
News to Ross that instructed Ross as to the opinion that Newport
News hoped he would espouse during this case.
The ALJ also received medical reports from several different
doctors. One such report, from Dr. James V. Scutero and dated
February 28, 1995, stated that Richardson had mildly decreased
vital capacity and no evidence of asbestosis. Records from Dr.
Baker in 1999 were consistent with his testimony that Richardson
suffered from both restrictive and obstructive lung disorders. In
1998 letters to Richardson’s primary physician, Dr. George G.
Childs, a pulmonary specialist, concluded that Richardson “has
severe obstructive lung disease with a mild restriction.” J.A.
202. Dr. Eric J. Freeman, a lung x-ray B reader who specializes in
diagnosing lung conditions only by reading the x-rays, in 2000
diagnosed Richardson with “a mild restrictive lung defect of
unknown etiology.” J.A. 223. Dr. Carlos F. Acosta, Richardson’s
primary care physician, diagnosed him with “severe chronic
obstructive pulmonary disease.” J.A. 247. In 1998, Dr. Steven M.
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Zimmet diagnoses Richardson with asbestosis, but several other
doctors disputed that diagnosis.
The evidence demonstrates that Richardson has trouble
breathing because he has something wrong with his lungs. The ALJ
was in the best position to judge the credibility of all of the
expert witnesses and medical records, and after sifting through all
of the evidence and agendas, he gave the most weight to the
diagnoses of asbestosis, restrictive lung disease, and obstructive
lung disease. With only the doctor for Newport News, Dr. Ross, who
had never even seen Richardson, disputing that Richardson had lung
injuries besides the asbestosis, there appears to be substantial
evidence to support the ALJ’s finding that Richardson suffered from
COPD, in addition to asbestosis, pleural plaques, and restrictive
lung disease.
III.
We conclude that the Board interpreted the law correctly when
it determined that Section 33(g) prohibits benefits only for
Richardson’s asbestos disability and not for the separate
disability of COPD. We also conclude that substantial evidence
supports the ALJ’s finding that Richardson suffers from COPD in
addition to asbestosis and is thus eligible for compensation. For
these reasons, we affirm the Board’s decision affirming the ALJ’s
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award of permanent partial disability benefits and deny Newport
News’s petition for review.
PETITION FOR REVIEW DENIED;
BOARD ORDER AFFIRMED
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