McDougal-Saddler v. Secretary Labor

Opinions of the United

1999 Decisions States Court of Appeals

for the Third Circuit

7-2-1999

McDougal-Saddler v. Secretary Labor

Precedential or Non-Precedential:

Docket 98-1068

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Filed July 2, 1999

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No. 98-1068

CLEOPATRA McDOUGAL-SADDLER

Appellant

v.

ALEXIS M. HERMAN, Secretary,

U.S. Department of Labor,

Appellee

ON APPEAL FROM THE

UNITED STATES DISTRICT COURT

FOR THE EASTERN DISTRICT OF PENNSYLVANIA

(D.C. No. 97-1908)

District Judge: Honorable Jan E. DuBois

Argued October 8, 1998

Before: McKEE, RENDELL, Circuit Judges, and

DEBEVOISE, Senior District Judge*

[Filed: July 2, 1999]

Jeffrey P. Zeelander [Argued]

1608 Walnut Street,

Suite 1300

Philadelphia, PA 19103-5407

_________________________________________________________________

*Honorable Dickinson R. Debevoise, United States Senior District Judge

for the District of New Jersey, sitting by designation.

Richard B. Cappalli

Klein Hall

1719 N. Broad Street

Philadelphia, PA 19122

Counsel for Appellants

Karen B. Kracov [Argued]

Assistant United States Attorney

Michael R. Stiles

United States Attorney

James G. Sheehan

Assistant United States Attorney

Chief, Civil Division

Nadine M. Overton

Assistant United States Attorney

615 Chestnut Street, Suite 1250

Philadelphia, PA 19106-4476

Counsel for Appellees

OPINION OF THE COURT

DEBEVOISE, Senior District Judge:

Appellant, McDougal-Saddler, appeals the district court's

order granting the motion of Cynthia Metzler, Acting

Secretary, United States Department of Labor ("DOL")1 to

dismiss the complaint for lack of subject matter

jurisdiction. We have jurisdiction over this appeal pursuant

to 28 U.S.C. S 1291.

In an earlier opinion we affirmed the district court on the

ground that McDougal-Saddler lacked standing to bring

this action. Upon her petition for panel rehearing we

vacated that opinion and asked for supplemental briefing.

We will now affirm, holding that by virtue of 5 U.S.C.

S 8128(b) the district court did not have jurisdiction.

_________________________________________________________________

1. Alexis M. Herman is presently United States Secretary of Labor.

2

I. The Facts

On May 14, 1982 McDougal-Saddler, then a 39-year old

U.S. Postal Service distribution clerk, filed a claim with the

Office of Workers' Compensation Program ("OWCP") for an

injury to her back, upper neck and shoulder sustained on

May 8 when handling trays of mail. On June 24 the OWCP

began payment of compensation for temporary total

disability. Dr. David S. Schwartz, a Board-certified internist

and cardiologist, began treating McDougal-Saddler on

August and diagnosed cervical and lumbosacral strains. He

found his patient to be totally disabled.

After a February 1985 fitness-for-duty evaluation,

McDougal-Saddler was offered and accepted reemployment

as a distribution clerk with limited duties. She returned to

work on March 31, 1985 but again stopped working on

April 5, stating that because of pain in her neck, shoulder,

arm and back she could not continue. Dr. Schwartz

examined her the next day; he diagnosed cervical and

lumbar strain and stated she was totally disabled.

On May 7, McDougal-Saddler filed a claim for a

traumatic injury to her neck, shoulders and upper and

lower back sustained on April 5 when casing mail. On May

20 the OWCP again began payment of compensation for

temporary total disability. In a June 17, 1985 report Dr.

Schwartz diagnosed cervical radiculopathy. In a May 22,

1986 report he diagnosed chronic pain syndrome including

chronic lumbosacral strain and chronic cervical strain. In

an April 10, 1987 report Dr. Schwartz wrote, "Because of

chronic debilitating pain and limited range of motion due to

muscle stiffness and spasm, despite intensive physical

therapy and medication, [McDougal-Saddler] is totally

disabled from work at this time and for the near indefinite

future."

The OWCP referred McDougal-Saddler to Dr. William H.

Simon, a Board-certified orthopedic surgeon for a second

opinion. In a May 4, 1987 report Dr. Simon diagnosed

cervical and lumbar discogenic syndrome with cervical and

lumbar nerve root irritation. He concluded that "[t]here is

no evidence that she sustained any acute injury that is

responsible for this but that she has a slowly developing

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degenerative condition which limits the amount of work

that she can do."

On December 31, 1987 the OWCP notified McDougal-

Saddler that it proposed to terminate her compensation on

the ground that her disability resulting from her

employment injuries had ceased. In response McDougal-

Saddler submitted another report of Dr. Schwartz in which

he stated that her symptoms were "specifically due" to her

May 8, 1982 injury and that her April 5, 1985 injury

"added to her previous cervical and lumbosacral strain."

Effective November 20, 1988 the OWCP terminated

McDougal-Saddler's compensation on the ground that the

weight of the medical evidence established that her

disability from her employment injuries ceased by that

date. After a hearing an OWCP hearing representative

found in a February 21, 1989 decision that McDougal-

Saddler had not been afforded due process because she

had not been provided with a copy of Dr. Simon's May 4,

1987 report. The hearing representative remanded the case

for reinstatement of compensation and a re-evaluation by

Dr. Simon.

At Dr. Simon's request a Board-certified radiologist

performed a computerized tomography scan of McDougal-

Saddler's lumbosacral and cervical spine. On the basis of

the resulting report Dr. Simon revised his original opinion,

stating in a November 15, 1989 report, "we now have

objective evidence that this patient has cervical discogenic

abnormalities beyond degenerative changes both in her

neck and back."

Based on the entirety of the reports which had been

submitted to it, the OWCP found that there was a conflict

of medical opinion. On October 22, 1991, it referred the

case to Dr. John T. Williams, a Board-certified orthopedic

surgeon, to resolve the conflict. The OWCP purported to act

pursuant to the provisions of 5 U.S.C. S 8123(a), which

provides: "If there is disagreement between the physician

making the examination for the United States [Dr. Simon]

and the physician of the employee [Dr. Schwartz], the

Secretary shall appoint a third physician who shall make

an examination." According to the Federal (FECA)

4

Procedure Manual, "The [Employees' Compensation Appeals

Board] has stated that `an impartial specialist's report is

entitled to greater weight than other evidence of record as

long as his conclusion is not vague, speculative or

equivocal and is supported by substantial medical

reasoning'." Part Two, Chapter 2-810.11 c.(2).

Dr. Williams conducted a physical examination of

McDougal-Saddler, reviewed the medical records and in a

March 4, 1992 report stated, among other things, that

"what we are seeing here is the progression of degenerative

joint and degenerative disc disease over a period of

approximately seven years secondary to the normal wear

and tear on the body and the aging process. The work-

related injury did not cause the degenerative pathology first

noted in 1987."

The OWCP terminated McDougal-Saddler's compensation

on September 20, 1992, concluding that the weight of the

medical evidence, represented by Dr. Williams's reports,

established that the effects of her April 5, 1985 and May

11, 1982 injuries had ceased. On appeal an OWCP hearing

representative found in a November 24, 1993 decision that

the opinion of Dr. Williams, the impartial medical specialist,

resolved the conflict of medical opinion and established that

the effects of the 1982 and 1985 injuries had ceased by

September 20, 1992. By letter dated February 27, 1995

McDougal-Saddler requested reconsideration, contending,

among other things, that Dr. Williams was not an impartial

medical specialist entitled to special weight because Dr.

Simon's November 15, 1989 report did not conflict with the

conclusions of Dr. Schwartz. The OWCP denied the request

for reconsideration, and McDougal-Saddler appealed to the

Employees' Compensation Appeals Board ("ECAB").

The ECAB authored a detailed opinion. It weighed the

evidence which had been developed during the years

following McDougal-Saddler's original injury in May 1982.

It contrasted the qualifications of Drs. Williams and

Schwartz and analyzed the basis and reasoning of their

respective reports. It found "that the weight of the medical

evidence establishes that [McDougal-Saddler's] disability

related to her May 8, 1982 and April 5, 1985 employment

injuries ended by September 20, 1992."

5

The ECAB, however, agreed with McDougal-Saddler's

contention that Dr. Williams was not an impartial medical

specialist because at the time of his appointment there was

no conflict of medical opinion.

The consequence which the ECAB attributed to the

denial of impartial medical specialist status to Dr. Williams

was ". . . the reports of Dr. Williams are thus not entitled

to the special weight afforded to the opinion of an impartial

medical specialist resolving a conflict of medical opinion

. . ." The ECAB treated Dr. Williams's reports in the same

manner as it treated the other medical evidence, giving it

no special deference. It weighed the totality of the evidence

and on March 20, 1996 affirmed the decision of the OWCP.

Thereafter it denied a petition for reconsideration.

McDougal-Saddler contends that the procedures leading

to the denial of her benefits were in violation of the clear

mandate of 5 U.S.C. S 8123(a) which provides in relevant

part:

If there is disagreement between the physician making

the examination for the United States and the

physician of the employee, the Secretary shall appoint

a third physician who shall make an examination.

(emphasis added).

This mandate is implemented by regulation:

If there should be disagreement between the physician

making the examination on the part of the United

States and the injured employee's physician, the Office

shall appoint a third physician, qualified in the

appropriate specialty, who shall make an

examination . . . . (emphasis added).

20 C.F.R. S 10.408.

The ECAB's opinion held that Dr. Williams was not an

impartial expert because there was no conflict of medical

opinion at the time his opinion was sought. Thus the

"disagreement between the physician making the

examination for the United States and the physician of the

employee" arose at the time Dr. Williams rendered his

opinion. Notwithstanding the dictate of S 8123(a), the ECAB

did not require appointment of "a third physician". Instead

6

it weighed the evidence before it, affirmed the decision of

the OWCP terminating compensation and later denied a

petition for reconsideration.

Notwithstanding the explicit language of S 8123(a) and

implementing regulations, OWCP weighs the medical

reports when determining whether to appoint a third

physician. In its Federal (FECA) Procedural Manual and in

practice, according to McDougal-Saddler, OWCP appoints a

third physician only "where the analysis of the evidence

demonstrates conflicting opinions or conclusions which are

supported almost equally." Generally "[c]areful analysis of

the medical evidence should allow for resolution of most

issues without resorting to a referee or `impartial'

specialist." (Federal (FECA) Procedure Manual, Part Two,

Chapter 2-810-11 a, App. 53).

It is difficult to square this weighing process with the

S 8123(a) mandate that "[i]f there is disagreement [between

the government and employee physicians] the Secretary

shall appoint a third physician." (emphasis added).

McDougal-Saddler filed in the district court a complaint

and petition for declaratory and injunctive relief, alleging

that DOL has adopted procedures that violate the statutory

directive regarding the appointment of a third physician.

II. The District Court Opinion

The DOL moved to dismiss McDougal-Saddler's complaint

for lack of subject matter jurisdiction, relying on 5 U.S.C.

S 8128(b) which provides:

(b) The action of the Secretary or his designee in

allowing or denying a payment under this subchapter

is--

(1) final and conclusive for all purposes and with

respect to all questions of law and fact; and

(2) not subject to review by another official of the

United States or by a court by mandamus or

otherwise.

McDougal-Saddler urged in opposition to the motion to

dismiss that two exceptions to the prohibition on judicial

7

review applied. She asserted that the bar did not apply

because she presented evidence of a cognizable

constitutional violation. She asserted further that the bar

did not apply because the actions of the DOL violated a

clear statutory mandate.

The district court rejected McDougal-Saddler's

constitutional claims. It held that FECA PM 2-810-11a

providing for a weighing of the medical evidence before

appointing a third physician was simply an interpretive rule

clarifying the word "disagreement" in S 8123(a) and

therefore did not require public notice or a public comment

period to be valid. Its application to McDougal-Saddler did

not violate her due process rights or otherwise create a

cognizable constitutional claim. McDougal-Saddler does not

challenge this ruling in her appeal.

The district court assumed for the purposes of its

decision that a violation of a clear statutory mandate

creates subject matter jurisdiction for a court to hear a

case brought under FECA. It found, however, that because

the ECAB interpretation was plausible, there was no such

violation, holding:

The Court concludes that FECA PM 2-810 instructs

claims examiners in how to determine whether a

"disagreement" between physicians exists, and that

defendant's interpretation of 5 U.S.C. S 8123(a), using

FECA PM 2-810, is plausible. Under that

interpretation, it was appropriate for ECAB to decide

plaintiff's claim based on the weight of the medical

evidence. ECAB did not violate a clear statutory

mandate in evaluating plaintiff 's claim. The statute did

not, under the facts presented, require ECAB to

remand the case for the appointment of an

independent physician to conduct an examination of

plaintiff.

The court granted DOL's motion to dismiss.

III. Discussion

The statutory provision at issue here provides that "[t]he

action of the Secretary or his designee in allowing or

8

denying a payment is - (1) final and conclusive for all

purposes with respect to all questions of law and fact; and

(2) not subject to review by another official of the United

States or by a Court by mandamus or otherwise." 5 U.S.C.

S 8128(b). Although Congress is ordinarily presumed to

have intended judicial review of agency action, "Congress is

absolutely free to limit the extent to which it consents to

suit" against the United States or its instrumentalities.

Clinton County Com'rs v. United States E.P.A., 116 F.3d

1018, 1025 (3d Cir. 1997) cert. denied sub nom. Arrest the

Incinerator Remediation (A.I.R.), Inc., 118 S.Ct. 687. 139

L.Ed.2d 633 (1998).

The starting point for the determination of Congress's

intent is the language of the statute. See New Rock Asset

Partners, L.P. v. Preferred Entity Advancements, Inc., 101

F.3d 1492, 1498 (3d Cir. 1996). In the present case there

can hardly be plainer language than that which S 8128(b)

employs. The Supreme Court has referred to S 8128(b) as

an example of language that Congress uses when it

"intends to bar judicial review altogether." Lindahl v. Office

of Personnel Management, 470 U.S. 768, 779-780, 105

S.Ct. 1620, 84 L.Ed.2d 674 (1985).

The question whether a statute precludes judicial review

"is determined not only from its express language, but also

from the structure of the statutory scheme, its objectives,

its legislative history, and the nature of the administrative

action involved." Block v. Community Nutrition Institute, 467

U.S. 340, 345, 104 S.Ct. 2450, 81 L.Ed.2d 270 (1984).

Both McDougal-Saddler and the DOL have reviewed the

legislative history of FECA and in particular the evolution of

S 8128(b). Each side argues that the legislative history

supports its position.

In Czerkies v. United States Dep't of Labor, 73 F.3d 1435

(7th Cir. 1996), Chief Judge Posner examined the same

history and found that it "reveals the limited scope of the

door-closing provision." Id. at 1440, and that adoption of

the provision "may well have been an accident." Id. at 1441.

That case, however, concerned a constitutional challenge to

action of the DOL. The court held that "[t]he history of the

Federal Employees Compensation Act provides no basis for

rebutting the presumption of judicial review of

9

constitutional claims. It is distasteful to suppose that an

administrative agency would claim to receive from Congress

by sheer inadvertence a license to ignore the Constitution."

Id. at 1441. Although the district court had jurisdiction to

hear Czerkies' constitutional claim, the Supreme Court

affirmed the judgment dismissing the suit because the

constitutional claim was insubstantial.

Unlike Czerkies the present appeal does not involve a

constitutional claim. The district court held that adoption

and compliance with the provisions in the procedural

Manual providing for a weighing of the medical evidence did

not violate McDougal-Saddler's due process rights or

otherwise create a cognizable constitutional claim.

McDougal-Saddler does not challenge that conclusion on

this appeal, and we are not required to decide whether

S 8128(b) would deprive a district court of jurisdiction to

hear such a claim.

It is necessary to decide whether an asserted violation of

a clear statutory mandate constitutes a second exception to

the statutory bar. We conclude that there is nothing in the

legislative history which would permit a departure from the

unequivocal language of S 8123(b) to review such an

asserted violation, and that the decisions of our court

preclude such a departure.

McDougal-Saddler relies primarily upon two United

States Supreme Court cases, Oestereich v. Selective Serv.

Sys., 393 U.S. 233, 89 S.Ct. 414, 21 L.Ed.2d 402 (1968)

and Leedom v. Kyne, 358 U.S. 184, 79 S.Ct. 180, 3 L.Ed.2d

210 (1958). In Oestereich the draft law gave a "plain and

unequivocal" service exemption to students preparing for

the ministry. Notwithstanding the exemption, Oestereich's

draft board reclassified him I-A as a form of discipline when

he returned his registration certificate to protest the

Vietnam War. Oestereich brought suit in the United States

District Court to restrain his induction. Unambiguously

S 10(b)(3) of the Military Service Act of 1967 provided that

"No judicial review shall be made of the classification or

processing of any registrant by local boards, appeal boards,

or the President, except as a defense to a criminal

prosecution instituted under section 12 of this title, after

the registrant has responded either affirmatively or

10

negatively to an order to report for induction . . .." The

Court declined to apply S 10(b)(3) literally, holding that

"[s]ince the exemption granted divinity students is plain

and unequivocal . . . pre-induction judicial review is not

precluded . . . ." 393 U.S. at 238-239.

In Leedom the National Labor Relations Board included

both professional and nonprofessional employees in a

collective bargaining unit in clear violation of the National

Labor Relations Act. The association representing the

professional employees brought suit in the United States

District Court challenging the NLRB's action. The NLRA

permitted judicial review of a Board certification order by a

petition for enforcement or review of an order made under

S 10(c) of the Act restraining an unfair labor practice; the

Board argued that its order was not otherwise subject to

judicial review. The Court held that the review provisions of

the NLRA did not preclude an action "to strike down an

order of the Board made in excess of its delegated powers

and contrary to a specific prohibition in the Act." 358 U.S.

at 188.

More recent decisions of the Supreme Court and of our

Court establish that Oestereich has not been extended

beyond its particular facts and that the Kyne "clear

statutory mandate" exception will not be applied when the

statute provides clear and convincing evidence that

Congress intended to deny district court jurisdiction. In

Board of Governors of Fed. Reserve Sys. v. MCorp Fin., Inc.,

502 U.S. 32, 112 S.Ct. 459, 116 L.Ed.2d 358 (1991),

MCorp sought to enjoin administrative proceedings

instituted against it by the Federal Reserve Board on the

ground that the proceedings were in excess of the Board's

authority. It relied upon the Kyne doctrine to overcome the

statutory bar to district court jurisdiction. The Court

advanced two reasons for applying the statutory bar

notwithstanding a claim of violation of a clear statutory

mandate. First, MCorp had an alternative means of review.

Second:

. . . [a] related factor distinguishing this litigation from

Kyne is the clarity of the congressional preclusion of

review in FISA. In Kyne, the NLRB contended that a

statutory provision that provided for judicial review

11

implied, by its silence, a preclusion of review of the

contested determination. By contrast, in FISA Congress

has spoken clearly and directly: "[N]o court shall have

jurisdiction to affect by injunction or otherwise the

issuance or enforcement of any [Board] notice or order

under this section." 12 USC S 1818(i)(1) (1988 ed, Supp

II) [12 USCS S 1818(i)(1)] (emphasis added). In this way

as well, this litigation differs from Kyne.

Viewed in this way, Kyne stands for the familiar

proposition that "only upon a showing of `clear and

convincing evidence' of a contrary legislative intent

should the courts restrict access to judicial review."

Abbot Laboratories v. Gardner, 387 US 136, 141, 18 L

Ed 2d 681, 87 S Ct 1507 (1967). As we have explained,

however, in this case the statute provides us with clear

and convincing evidence that Congress intended to

deny the District Court jurisdiction to review and

enjoin the Board's ongoing administrative proceedings.

502 U.S. at 44 (footnote omitted).

In Hindes v. F.D.I.C., 137 F.3d 148, 164 (3d Cir. 1998),

we noted the "limited exception to a statute's withdrawal of

jurisdiction where the plaintiff claims that the agency acted

in a blatantly lawless manner or contrary to a clear

statutory prohibition" and emphasized "that an integral

factor in determining the applicability of the exception is

the clarity of the statutory preclusion."

In Clinton County plaintiffs sued the United States

Environmental Protection Agency ("EPA") to enjoin EPA

from proceeding with a trial burn and incineration remedy.

The district Court dismissed for lack of subject matter

jurisdiction, citing statutory provisions precluding judicial

review until EPA's remedial activities were completed.

Rejecting plaintiffs' contention that under the Kyne doctrine

violation of a clear statutory prohibition constituted an

exception to the statutory bar, we stated "[s]ubsequent

cases have refined the Kyne doctrine. In Briscoe v. Bell, 432

U.S. 404, 97 S.Ct. 2428, 53 L.Ed.2d 439 (1977), the Court

held that jurisdiction to review agency action allegedly in

excess of statutory authority cannot be inferred when

language in the statute itself expressly forecloses judicial

12

review . . . . More recently, in Board of Governors v. MCorp

Financial, Inc., . . . the [Supreme] Court reiterated that a

right to judicial review under Kyne may be inferred only if

there is no clear statutory prohibition of such review." 116

F.3d at 1028-1029.2

The language of S 8128(b) provides clear and convincing

evidence that Congress intended to deny the district courts

jurisdiction to review decisions of the DOL. The language is

broad enough to include both policy or rule making

decisions of the Secretary as well as individual benefit

determinations. Paluca v. Secretary of Labor, 813 F.2d 524,

527-28 (1st Cir.), cert. denied sub nom. Roberts v. Secretary

of Labor, 484 U.S. 943, 108 S.Ct. 328, 98 L.Ed.2d 355

(1987).

McDougal-Saddler seeks to distinguish MCorp, Hindes

and Clinton County from the present case, arguing that (i)

MCorp, the CERCLA case (Clinton County) and the FIRREA

case (Hindes) each involves claims with language, history

and function very different from those applicable in FECA

cases and (ii) in MCorp, Hindes and Clinton County some

form of relief was available in future proceedings. The

principles of statutory construction set forth in those cases,

however, are equally applicable here, regardless of the

context. When a plaintiff seeks to rely upon the Kyne

doctrine these circumstances are insufficient to overcome a

clear statutory prohibition of judicial review such as

S 8128(b).

_________________________________________________________________

2. In dicta four circuits have stated S 1331 jurisdiction exists to review

claims that OWCP policy violated clear statutory commands. See Staacke

v. United States Secretary of Labor, 841 F.2d 278, 281-82 (9th Cir.

1988), citing Oestereich v. Selective Serv. Sys. , 393 U.S. 233, 89 S.Ct.

414, 21 L.Ed.2d 402 (1968) and Leedom v. Kyne, 358 U.S. 184, 79 S.Ct.

180, 3 L.Ed.2d 210 (1958) (finding no clear statutory command);

Woodruff v. United States Dep't of Labor, 954 F.2d 634, 639-40 (11th Cir.

1992); (same); Brumley v. United States Dep't of Labor, 28 F.3d 746 (8th

Cir. 1994), cert. denied, 513 U.S. 1082, 115 S.Ct. 734, 130 L.Ed.2d 637

(1995) (same); Hanauer v. Reich, 82 F.3d 1304, 1307-09 (4th Cir. 1996).

These opinions, however, predate our Court's opinions in Hindes and

Clinton County.

13

IV. Conclusion

For the foregoing reasons, we will affirm the district

court's order granting the DOL's motion to dismiss the

complaint.

A True Copy:

Teste:

Clerk of the United States Court of Appeals

for the Third Circuit

14