# Petition for Writ of Certiorari — Department of Labor v. Triplett > Briefs, arguments, decisions, and more. URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385012_0495%3A02 ## Record - **Collection:** Supreme Court brief - **Document type:** Petition for Writ of Certiorari - **Published:** January 1, 1990 - **Citation:** 494 U.S. 715 ## Text APR 12 1809 aosere rs an a ; * Octoser TERM, 1988 UNITED STATES DEPARTMENT OF LABOR, PETITIONER v. GEORGE R. TRIPLETT, ET AL. 3 ‘ PETITION FCR A WRIT OF CERTIORARI TO THE : t SUPREME COURT OF APPEALS OF WEST VIRGINIA ' , - WILLIAM C. BRYSON Acting Solicitor General JOHN R. BOLTON q Assistant Attorney General >: DAVID L. SHAPIRO J : ; Deputy Solicitor General oe MICHAEL R. DREEBEN - 4 Assistant to the Solicitor General ‘ WILLIAM KANTER | JOHN S. KOPPEL . Attorneys Y Department of Justice i Washington, D.C. 20530 } (202) 633-2217 5 JERRY G. THORN : Acting Solicitor of Labor ; ALLEN H, FELD*AAN : ‘ Associate Solicitor g MARY-HELEN MAUTNER j % Counsel for Appellate Litigation 3 = EDWARD D. SIEGER ; Altorney | Department of Labor Washington, D.C. 20210 QUESTION PRESENTED Whether the attorney’s fee provisions of the Black Lung Benefits Act, as applied, violate the Due Process Clause of the Fifth Amendment by denying claimants access to counsel. (1) PARTIES TO THE PROCEEDING Petitioner, intervenor below, is the United States Department of Labor. Respondent, the respondent below, is George R. Triplett. The Committee on Legal Ethics of the West Virginia State Bar, the petitioner below, is a respondent in this Court under Rule 19.6 of the Rules of this Court. TABLE OF CONTENTS Page EY Pee eee l ee ke liccecesececesten l Statutory and regulatory provisions involved ............... 2 eh CRs cin cca de ec edbdecccenccces 2 Reasons for granting the petition ...................000005 11 Ree Cdl cen aceeesee veceseecuseceses 24 OE EE eee Tree ee ey EEE YE ET la ah Cita. Whe hon acebdss sevens eeesnen 37a ie Cie hav ehh wdndae ceeecceeeceecébecaces 42a es Liane ece cess Gd bee eiesceetes 52a a a seep db ctencesse 53a TABLE OF AUTHORITIES Cases: Banks v. Chicago Grain Trimmer’s Ass’n, 390 U.S. 459 EE «Oe oe a dae ccc eccecccess 14 Blanchard v. Bergeron, 109 S. Ct. 939 (1989) ........... 16 Blodgett v. Holden, 275 U.S. 142 (1972) ............... 12 Camp v. Herzog, 104 F. Supp. 134(D.D.C. 1952) ....... 22 Director, Office of Workmen’s Compensation Programs v. Hemingway Transport, Inc., | Ben. Rev. Bd. Serv. a Oe ccc ceebeedecetécees 3 Fisch, In re, 188 App. Div. 525, 177 N.Y.S. 338 (1919) ... 14 General Dynamics Corp. v. Horrigan, 848 F.2d 321 (ist Cir.), cert. denied, 109 S. Ct. 554 (1988) ............. 3 Goldberg v. Kelly, 397 U.S. 254 (1970) ........... ren, = Hobbs v. Director, Office of Workers’ Compensation Programs, 820 F.2d 1528 (9th Cir. 1987) ............. 4, 16 Lassiter v. Department of Social Services, 452 U.S. 18 CE eae CSU TCU Ch cS ccctececcdcccveseces 19 Levins v. Benefits Review Board, 724 F.2d 4 (ist Cir. ERE M eS 2 CL Sebi ewe gacedesesescceesess 16 Lyng v. Payne, 476 U.S. 926 (1986) .................4.. 20 Mathews v. Eldridge, 424 U.S. 319 (1976) ............ 7, 13, 20 (III) ae IV Vv Cases — Continued: Page Statutes and regulations — Continued: Page Pennsylvania v. Delaware Valley Citizens’ Council for ; ro - “ery ay Cee eeccecccceccccuses sy ron Clean Air, 107 S. Ct. 3078 (1987) ............eeee eee 15-16 c), 33 U.S.C. 928(c) ........... 222s eee eee , 5, 55a Pittston Coal Group v. Sebben, 109 S. Ct. 414 (1988) .... 3 § 28(€), 33 U.S.C. 928(e) (1982 & Supp. IV 1986) ... 22, 56a Rostker v. Goldberg, 453 U.S. 57 (1981) ............45. 12 Federal Coal Mine Health and Safety Act of 1969, Pub. Schweiker v. Wilson, 450 U.S. 221 (1981) .............. 18 L. No. 91-173, Tit. IV, § 422, 83 Stat. 796 ........... 14 Shoemaker, In re, 11 Black Lung Rep. 3-145 (ALJ as rae eS ae 23 Pe. megane, pti ibeitiaas °° peeing se! 23 EE a 23 udent ic Interest Research Group v. 42 9 Laboratories, 842 F.2d 1436 (3d Cir. 1988) ........... 16 - mee Tee eg bee bkaeeaee 16 Taylor v. Director, Office of Workers’ Compensation aan 725.351(aXs » Programs, 9 Black Lung Rep. 3-184 (ALJ 1988) ...... 23 re pag Dive ce eee eee e ene e eee eens ; Thompson v. Potashnick Construction Co., 812 F.2d roger a 5 362-725 3 67 > seshtythy adhe lp Cathal ated ahicin avs . SR A HE Ca cb cb bcdcntewbecsecccccesceecs 4, 16 Section 725 363 gt etter mca tai 3 United States v. Carte’, 760 F.2d 266 (4th Cir. 1985) ..... 22 Section 125.365 es NTS 3.5 Velasquez v. Director, Office of Workers’ Compensation Sections 725.365-725.367 ....................... 2, $Ta Programs, 844 F.2d 738 (10th Cir. 1988) ............. 4, 16 aii RRR RE en 3, $7a Walters v. National Association of Radiation Survivors, a aa —_ Gp ls Eb Grind Knee cenensencnss seeeees passim Nene nnn evncueuccel 4 Wells v. Director, Office of Workers’ Compensation Pro- nu casesewcne 59a grams, 9 Black Lung Rep. 1-63 (Ben. Rev. Bd. 1986)... 23 ii Sa Ra ee esa ol 4 Yeiser v. Dysart, 267 U.S. $40 (1925) ..........--20005- 15 SE ee eR 4 i 4 Constitution, statutes, and regulations: TEE De ee eee eee 4 rey a eee 4 U.S. Const.: : PI ee See a 21 Section 802.202(e) ....... 2.6... e cece e ence eees 22 Amend. V (Due Process Clause) ................ 2, 20, 24 es os a dis pysehieaunaen 22 Act of Mar. 4, 1927, ch. 509, § 28, 44 Stat. 1438 ........ l : Miscellaneous: Black Lung Benefits Act, 30 U.S.C. 901 ef seg. ......... 115 Cong. Rec. (1969): TN ac ansacoswess >. 37,970 - Gs Ps TEE oc ockccencccacceceesececcess 53a >. 39.709 es Tr ee ee Meee eee» 14 § 422(a), 30 U.S.C. 932(a) (1982 & Supp. IV 1986) .. 2, 3, 4 nm agg anak aeanemat amen Black Lung Benefits Act Amendments of 1981, Pub. L. eS wales ches cevéceviunesscee st 14 No. 97-119, 95 Stat. 1643 ... 2.0... cece eee eee ees 18 a ee ie, 14 Longshore and Harbor Workers’ Compensation Act, 33 i as Solas oh'deeae ed navens evans 14 U.S.C. 921 ef seq. Bier Gy EID ok ccc ccccesccvicceces 18 § 21(c), 33 U.S.C. 921(C) .... 0... eevee eee eee: ‘ SO PET GRIIP ORI os 5... oe ec csecceceesss 22 § 28, 33 U.S.C. 928 (1982 & Supp. IV 1986) ........ 2, 3, J. Stein, G. Mitchell & B. Mezines, Administrative Law 4, 13, 54a "EES a a pf oma RR aa 22 Vi Miscellaneous — Continued: H.R. 9498, 69th Cong., Ist Sess. (1926) ................ H.R. Conf. Rep. No. 761, 91st Cong., Ist Sess. (1969) ... H.R. Rep. No. 1441, 92d Cong., Ist Sess. (1972) ........ Hearing on H.R. 9498 Before the House Comm. on the Judiciary, 69th Cong., Ist Sess. (1926) .............. Hearnigs on S. 3170 Before a Subcomm. of the Senate Comm. on the Judiciary, 69th Cong., Ist Sess. (1926) . . House Comm. on Education and Labor, 96th Cong., Ist Sess., Black Lung Benefits Reform Act and Black Lung Benefits Revenue Act of 1977 (Comm. Print 1979) .... Investigation of the Backlog in Black Lung Cases: Hear- ings before the Subcomm. on Labor Relations of the House Comm. on Education and Labor, 99th Cong. ff FO See re ee ee ee Oversight Hearing on the Administration of the Black Lung Program: Hearing Before the-Subcomm. on Labor Standards of the House Comm. on Education and Labor, 100th Cong., 2d Sess. (1988) ............. Report to the Honorable Donald J. Pease, House of Representatives by the U.S. General Accounting Office, Adjudication of Black Lung Claims by Labor’s Office of Administrative Law Judges and Benefits Review ED bed cbkn ede Cecadeds cdvedecess S. 3170, 69th Cong., Ist Sess. (1926) .............0555. U.S. Department of Labor, Employment Standards Ad- ministration, A Sample Survey of All Sources of Both Monetary and Non-Monetary Income of vlack Lung PET 0.6 00:6 06:40:00 c00600eseredbonnees 23 6, 18 Jn the Supreme Court of the Gnited States OCTOBER TERM, 1988 No. UNITED STATES DEPARTMENT OF LABOR, PETITIONER V. GEORGE R. TRIPLETT, ET AL. PETITION FOR A WRIT OF CERTIORARI TO THE SUPREME COURT OF APPEALS OF WEST VIRGINIA The Acting Solicitor General, on behalf of the United States Department of Labor, petitions for a writ of cer- tiorari to review the judgment of the Supreme Court of Appeals of West Virginia in this case. OPINIONS BELOW The opinion of the Supreme Court of Appeals (App., infra, 1a-32a), is reported at 376 S.E. 2d 818. A dissenting opinion (App., infra, 33a-36a) and an opinion on rehear- ing (App., infra, 37a-41a) are unreported. The Findings of Fact, Conclusions of Law, and Recommendation Con- cerning Discipline of the Committee on Legal Ethics of the West Virginia State Bar (App., infra, 42a-5la), are unreported. JURISDICTION The judgment of the Supreme Court of Appeals was entered October 26, 1988. A petition for rehearing was denied on December 21, 1988 (App., infra, 52a). On March 14, 1989, Chief Justice Rehnquist extended the time for filing a petition for a writ of certiorari to and (1) 2 including April 20, 1989. The jurisdiction of this Court is invoked under 28 U.S.C. 1254(1). STATUTORY AND REGULATORY PROVISIONS INVOLVED Section 422(a) of the Black Lung Benefits Act, 30 U.S.C. 932(a) (1982 & Supp. IV 1986), incorporating various provisions of the Longshore and Harbor Workers’ Compensation Act (LHWCA), and Section 28 of the LHWCA (33 U.S.C. 928 (1982 & Supp. IV 1986)), which is one of the provisions so incorporated, are set forth in an appendix (App., infra, 53a-56a). The Department of Labor’s regulations governing the payment of claimants’ attorney’s fees in black lung cases, 20 C.F.R. 725.365-725.367, are set forth in an appendix (App., infra, 57a-60a). STATEMENT In this case the Supreme Court of Appeals of West Virginia determined that the system for awarding attorney’s fees in black lung cases violates the Due Process Clause of the Fifth Amendment, by denying claimants ac- cess to counsel. The court concluded that the attorney’s fee system produces undue delays in payment and provides in- adequate compensation, thereby discouraging most at- torneys in West Virginia from representing claimants for black lung benefits. The court thus held that, as apnlied, the attorney’s fee provisions are unconstitutional, and, consequently, the violation of those provisions cannot serve as the basis for attorney disciplinary proceedings. 1. The Black Lung Benefits Act, 30 U.S.C. 901 ef seq. (1982 & Supp. IV 1986), “provides benefits to those who have become totally disabled because of pneumoconiosis, a chronic respiratory and pulmonary disease arising from coal mine employment,” and to their eligible survivors. 3 Pittston Coal Group v. Sebben, 109 S. Ct. 414, 417 (1988). A claimant for benefits may be represented “in any pro- ceeding for determination of a claim” by a qualified repre- sentative, including an attorney. 20 C.F.R. 725.362, 725.363. As part of its protection for eligible beneficiaries, the Act regulates the payment of fees for a claimant’s at- torney. See 30 U.S.C. 932(a) (1982 & Supp. IV 1986) (incorporating, inter alia, 33 U.S.C. 928 (1982 & Supp. IV 1986)). The Department of Labor has also issued com- prehensive regulations governing the a‘‘ard of such fees. 20 C.F.R. 725.362-725.367. Under the Act and the Department of Labor’s regula- tions, an attorney for a black lung claimant is prohibited from charging a fee unless the fee has been approved by the appropriate agency or court. 33 U.S.C. 928(c); 20 C.F.R. 725.365. The regulations also provide that “[n]o contract or prior agreement for a fee shall be valid.” 20 C.F.R. 725.365. When the claimant does not prevail in his effort to win benefits, no fee is approved. See General Dynamics Corp. v. Horrigan, 848 F.2d 321 (Ast Cir.), cert. denied, 109 S. Ct. 554 (1988); Director, Office of Work- men’s Compensation Programs v. Hemingway Transport Inc., 1 Ben Rev. Bd. Serv. 73 (Ben. Rev. Bd. 1974). When the claimant does prevail in a contested case, the coal mine operator, its insurance carrier, or, in certain instances, the Black Lung Disability Trust Fund (administered by the Director of the Office of Workers’ Compensation Pro- grams in the Department of Labor) pays “a reasonabie at- torney’s fee.” 30 U.S.C. 932(a) (1982 & Supp. IV 1986) (in- corporating 33 U.S.C. 928(a)); 20 C.F.R. 725.367. The black lung regulations establish the procedures for applying for a fee and the criteria for its award. See 20 C.F.R. 725.366. The application must itemize the work done and note “the customary billing rate” of the person who performed it. /bid. An approved fee “shall be reason- 7 + ably commensurate with the necessary work done.” 20 C.F.R. 725.366(b). The regulation identifies as factors to be taken into account in setting a fee “the quality of the representation, the qualifications of the representative, the complexity of the legal issues involved, the level of pro- ceedings to which the claim was raised, the level at which the representative entered the proceedings, and any other information which may be relevant to the amount of fee requested.” Ibid. An attorney must apply separately to the “deputy com- missioner, administrative law judge, or appropriate appel- late tribunal” before whom the services were performed. 20 C.F.R. 725.366(a). A claim begins with processing by a Department of Labor deputy commissioner. 20 C.F.R. 725.401. Any party can then request a de novo hearing before an administrative law judge (ALJ). 20 C.P.R. 725.419. The ALJ’s decision is subject to review by the Benefits Review Board, and review of that decision is available in a court of appeals. 30 U.S.C. 932(a) (1982 & Supp. IV 1986) incorporating, inter alia, 33 U.S.C. 921(c); 20 C.F.R. 725.481, 725.482. An award of attorney’s fees is not enforceable until the claimant receives a final award of benefits (33 U.S.C. 928(a)). An approved fee at that point “shall be paid promptly and directly by the operator or carrier to the claimant’s attorney in a lump sum after the order becomes final.” 20 C.F.R. -725.367(a). The fees ultimately paid do not include interest. See Hobbs v. Director, Office of Workers’ Compensation Programs, 820 F.2d 1528, 1530-1531 (9th Cir. 1987). Nevertheless, the attorney’s risk of loss and the delay in payment can be reflected in the hourly rate charged by claimant’s attorney. See Velasquez v. Director, Office of Workers’ Comyeisa- tion Programs, 844-F.2d 738, 739 (10th Cir. 1988); Hobbs, 820 F.2d at 1529; Thompson v. Potashnick Construction Co., 812 F.2d 574, 577 (9th Cir. 1987). 5 2. a. Beginning in 1978, respondent, a West Virginia lawyer, entered into contingent fee agreements with ap- proximately fifteen black lung claimants (see App., infra, 2a, 46a-48a). These agreements entitled him to 25% of the back benefits recovered by the claimants as a result of his representation. Jbid. Between 1978 and 1983, claimants represented by respondent were awarded benefits, and he collected fees under the contingent fee arrangements. Since these fees were never approved by the appropriate agency or court, they were collected in violation of the Statute and Department of Labor regulations. Jd. at 47a-49a; see 33 U.S.C. 928(c), 20 C.F.R. 725.365. In 1987, the Committee on Legal Ethics of the West Virginia State Bar began a disciplinary proceeding against respondent based on his violations of the Department’s fee regulations. Following a hearing, the Committee found re- spondent to have engaged in professional misconduct. App., infra, 42a-44a. The misconduct consisted of “{h]is failure to abide by the [Department] regulation,” a failure that constituted among other things, “conduct that is prej- udicial to the administration of justice” and that “adverse- ly reflects on his fitness to practice law”. Jd. at 50a (citing West Virginia Code of Professional Responsibility, DR 1-102(A)(4), (5), and (6) (1982)). The Committee filed a complaint in the Supreme Court of Appeals of West Virginia to enforce a recommended six-month suspension. App., infra, la. b. The Supreme Court of Appeals denied enforcement of the suspension. App., infra, la-32a. The court held that the provisions for awarding attorney’s fees under the black lung statute and the Department’s regulations, as applied, “severely restrict [black lung] claimants’ ability to find competent lawyers to represent them, and therefore the system violates due process.” Jd. at 24a. The court con- cluded that because the attorney’s fee limitations were un- constitutional, respondent’s failure to comply with the 6 Department’s regulations did not violate West Virginia ethical rules.' Jd. at 30a. The court acknowledged that the Department’s regu- lations “appear[{] to provide for attorneys’ fees that will fairly compensate cumpetent counsel,” but it nevertheless found that “the factual record before us reveals that this is not the case.” App., infra, 16a. This “factual record” con- sisted solely of the affidavits of five attorneys submitted to the court as attachments to an amicus brief and of at- torney testimony before a House of Representatives Sub- committee in 1985. Jd. at 17a-20a (citing Investigation of the Backlog in Black Lung Cases: Hearings Before the Subcomm. on Labor Relations of the House Comm. on Education and Labor, 99th Cong., Ist Sess. (1985)). Based on that record, the court determined that the fee provi- sions manifested two inadequacies that deter “most” at- torneys from taking on black lung cases. Those problems were “the long delay in payment, without any provision for interest, and the lack of premiums to offset the con- tingent nature of the work.” App., Infra, 20a. The court added that “[t}his latter factor has become increasingly prominent as the approval rate [for claimants] has steadily declined” as a result of tighter eligibility criteria under 1981 amendments to the black lung statute. /bid. The court cited an approval rate of 22.7% for claimants before an ALJ and 5.8% overall under the 1981 amendments. Ibid. The low approval rate, the court believed, estab- lished “not only the necessity of lawyer representation, but [also] the substantial risk that a lawyer will receive no fee at all for his work.” Jbid. ' The court rejected the Committee’s charge in its complaint that Triplett had misrepresented his fee arrangements to the Department, finding that the Committee had not adequately alleged such a viola- tion and that the evidence did not support it in any event. App., infra, Sa-6a. — 7 The court then evaluated the attorney’s fee system under the three-factor test articulated by this Court in Mathews v. Eldridge, 424 U.S. 319 (1976), and Walters v. National Association of Radiation Survivors, 473 U.S. 305 (1985). App., infra, 20a-24a. Under this test, the court noted, it must weigh “the private interest that will be affected by the official action; the risk of an erroneous deprivation of such interest through the procedures used, the probable value, if any, of additional or substitute procedural safe- guards; and the Government’s interest in adhering to the existing system.” Jd. at 8a (quoting Walters, 473 U.S. at 321). Applying those factors, this Court in Walters had upheld Congress’s $10 fee limitation for attorneys in Veterans’ Administration (VA) benefits proceedings, find- ing no due process violation. The court here applied the same factors to reach the opposite result. First, the court identified two government interests in the regulation of fees in the bl.ick lung program: (1) the fee approval requirement serves “to ensure that neither the responsible operator nor the Trust Fund will be over- charged,” and (2) the prohibition of private fee agreements serves “to protect claimants from improvident agreements that needlessly deplete their benefits.” App., infra, 21a. The court discounted these interests, however, because of its view that the fee system in operation has made lawyers “almost enti ‘ely unavailable to claimants,” with the result that “under the current system the claimant seldom has an award to share.” bid. Turning to the second factor, the court surmised that the absence of counsel poses a serious risk of an erroneous result. While acknowledging that it lacked statistics com- paring the s’*ccess rates of black lung claimants with and without counsel, the court asserted that the “black lung claims process is procedurally, factually and legally com- plex,” and that “lawyer representation is virtually essential 8 to prevent erroneous deprivations of benefits for victims of black lung.” App., infra, 22a-23a. The court found sup- port for its determination in the experiences of respondent’s clients, who, the court stated, had failed to win benefits without counsel but had succeeded in winning benefits with counsel. Jd. at 22a. The court speculated that respondent’s “clients can probably be taken as representa- tive of most claimants.” Jbid. The court added that the advantage of having an attorney in a black lung case dis- tinguished this case from Walters, where veterans repre- sented by counsel were only “marginally more successful” than those who proceeded without lawyers. Jd. at 2la-22a. The court also observed that, in contrast to the network of veterans’ groups in Walters, nonlawyer representatives are not widely available for black lung claimants. Jd. at 23a. Finally, the court evaluated the weight of the private in- terests at stake. In Walters, this Court had emphasized that VA benefits are awarded on the basis of disability rather than need, which reduced their weight in the analysis of the process that was due. 473 U.S. at 333. Although black lung benefits are also awarded on the basis of disability, not need, the court here insisted that the in- terest in obtaining black lung benefits deserved a weight comparable to the strong interest in retaining subsistence welfare benefits that was recognized in Goldberg v. Kelly, 397 U.S. 254 (1970). App., infra, 23a-24a. The court ex- plained that since black lung benefits are awarded for total disability or death, they “may well provide the only means of subsistence” to claimants. Jd. at 24a. Summarily balancing these factors, the court concluded that “the system as currently administered denies claim- ants for black lung benefits property without due process of law by severely restricting their right to obtain epre- sentation by competent counsel.” App., infra, 28a; id. at 24a. Without citing any specific provision of the Constitu- 9 tion, the court also discovered an “independent” constitu- tional ground for invalidating the fee system: it effectively denies “qualified claimants the procedural safeguards pro- vided by Congress that are essential to vindicate the right to benefits granted by Congress.” Jd. at 24a-25a.? Two justices dissented. App., infra, 33a-36a. The dis- senting opinion noted that the majority had decided a con- stitutional question never raised below, and, as a conse- quence, “there is no factual record developed.” /d. at 33a. In particular, the dissent stated that “[t]he ex parte affi- davits” of attorneys practicing in the black lung field were “woefully inadequate” to sustain the finding that the black on fee system deprived claimants of access to counsel. id. The dissent also found the majority’s reliance on Walters to be “completely misplaced.” App., infra, 33a. The dissent took issue with the majority’s failure to give the appropriate deference to the “ ‘duly enacted and care- fully considered decision’” of Congress (id: at 34a (quoting Walters, 473 U.S. at 319)), and recalled that this Court in Walters had stressed that “ ‘{i]t would take an extraordinarily strong showing of ‘probability of ‘error under the present system—and the probability that the presence of attorneys would sharply diminish that possibility—to warrant a holding that the fee limitation denies claimants due process of law.’” App., infra, 34a-35a (quoting Walters, 473 U.S. at 326). Applying that standard, the dissent was convinced that no such “ ‘ex- traordinarily strong showing’ has been made based on the generalized ex parte affidavits filed with this Court.” App., infra, 35a (footnote omitted). ? While not purporting to direct the Labor Department to adopt any particular fee regulations, the court suggested that the Depart- ment “could provide for a contingent fee,” or could use a “multiplier * * * to enhance the ‘normal’ hourly fee to compensate for the risk of loss.” App., infra, 2Sa. 10 : 3. Recognizing that its decision “involves an important question of federal law,” the majority invited the Depart- ment of Labor to intervene as a party. App., infra, 30a. In response, the Department of Labor did intervene, to sup- plement the record and to petition for rehearing, but the petition for rehearing was denied (App., infra, 37a-4la). In a brief opinion, the court rejected or ignored the Department’s arguments that the fee system advances im- portant government interests and does not unduly hinder black lung claimants in obtaining counsel. In particular, the court ignored the argument that Congress specifically intended, in regulating fees, to shield claimants from im- provident fee agreements and to prevent dissipation of their benefits through payments to attorneys. The court also ascribed no significance to the Department’s argu- ment that, especially in view of the Trust Fund’s $3 billion debt to the government, the fee system serves an important governmental interest in avoiding overpayment. The court viewed this to be an argument that the current system of fees is justified as a way to keep down the number of suc- cessful claimants. Jd. at 39a-40a. As to the factual record, the Department presented statistics with its rehearing petition regarding the outcome of recent black lung cases before administrative law judges. App., infra, 40a. The statistics indicated that in 92% of cases resulting in an award or denial of benefits, the claimants had attorneys, and prevailed 29% of the time; in the remaining 8% of cases, the claimants pro- ceeded pro se, and prevailed 11.6% of the time. /bid. Without commenting on the overwhelming rate of repre- sentation at the ALJ level shown by these figures, the court read the statistics to mean only that claimants with counsel “have a likelihood of prevailing that is 2.5 times greater than claimants appearing pro se.” Ibid. Thus, the court concluded, the Department “has simply reinforced 1] with more elaborate statistics the conclusion that we reached in the original opinion — namely, that a claimant’s chance of prevailing when he is represented by counsel is substantially higher than when he appears pro se.” Ibid. REASONS FOR GRANTING THE PETITION The court below has declared unconstitutional the federal black lung attorney’s fee system, as applied, in one of the nation’s principal coal-mining states. That holding cannot be reconciled with the decisions of this Court ad- dressing due process challenges to administrative pro- cedures, and, in particular, is wholly at odds with the reasoning and result in Walters v. National Association of Radiation Survivors, supra. In Walters, this Court sus- tained against a due process challenge Congress’s decision to limit to $10 the attorney’s fee available in VA proceed- ings. Contrary to Walters, the court below failed to pay any deference to the congressional policy in favor of fee regulation, and relied on a factual showing far too meager to justify a sweeping conclusion that an Act of Congress is heing unconstitutionally applied. The decision below has important, and detrimental, practical ramifications. The black lung benefits program handles thousands of claims each year. The decision below substantially deprives black lung claimants in West Virginia of the protection against overreaching and against unjustified diminution of their benefits that Con- gress mandated in regulating attorney’s fees. Although the decision does not preclude the Department’s own enforce- ment of the attorney’s fee limitations, it does remove the primary method on which the Department relies to enforce the fee provisions in West Virginia —state bar disciplinary proceedings. If not reversed by this Court, the decision may also encourage attorneys in other coal-mining States 12 to flout the black lung fee requirements. Because the deci- sion below is wrong, and because it undermines the protec- tion for black lung claimants envisioned by Congress, review by this Court is warranted. 1. The court’s holding that the black lung fee system is unconstitutional cannot be squared with this Court’s deci- sions regarding the regulation of attorney’s fees. From the outset, the court below starkly misconceived its proper role by failing to pay the necessary deference owed to an Act of Congress. This Court has admonished that “[jJudg- ing the constitutionality of an Act of Congress is properly considered the gravest and most delicate duty that [the judiciary] is called upon to perform, and we begin our analysis here with no less deference than we customarily must pay to the duly enacted and carefully considered decision of a coequal and representative branch of our Government.” Walters, 473 U.S. at 319 (citations and in- ternal quotation marks omitted); Rostker v. Goldberg, 453 U.S. 57, 64 (1981); Blodgett v. Holden, 275 U.S. 142, 148 (1927) (Holmes, J.). The court below failed to heed that guiding principle. Instead, it insisted on drawing broad and unsound conclusions from a record far too sparse to serve as the basis for overturning an Act of Con- gress as administered by a federal agency. ~—tn finding the black lung-attorney’s fee system to be un- constitutional, the court purported to follow this Court’s established framework for assessing due process chal- lenges. In executing that task, however, the lower court misapplied all three factors to which this Court has directed inquiry: (1) the private interest that will be af- fected, (2) the risk of an erroneous deprivation of that in- terest through the procedures used, and the probable value of additional or alternative procedural safeguards, and (3) the government’s interest in adhering to the present system, including the fiscal and administrative burdens the 13 additional requirements would entail. Walters, 473 U.S. at 321; Mathews, 424 U.S. at 335. a. The court significantly undervalued the government interests served by the black lung attorney’s fee limits. Congress’s purpose in regulating black lung attorney’s fees is to protect claimants from improvident agreements that needlessly deplete their benefits. The regulation of at- torney’s fees in the black lung program results from Con- gress’s incorporation of Section 28 of the Longshore and Harbor Workers’ Compensation Act (LHWCA) (33 U.S.C. 928) into the Black Lung Benefits Act. The LHWCA has protected claimants against imprudent fee arrangements since its enactment in 1927. Act of Mar. 4, 1927, ch. 509, § 28, 44 Stat. 1438. The same reasons that prompted the regulation of attorney’s fees in the LHWCA context are equally applicable here. Section 28 of the LHWCA, as originally enacted, pro- vided that no one may charge a claimant a fee unless ap- proved by the appropriate court or administrative officer. Ibid. This provision was specifically designed to protect a class of unsophisticated workers who had been subjected to “sharp practices” of people who represented them. See Hearing on H.R. 9498 Before the House Comm. on the Judiciary, 69th Cong., Ist Sess. 40 (1926) (statement of Harry S. Austin, attorney for the International Long- shoremen’s Association) (1926 House Hearings); Hearings on S. 3170 Before a Subcomm. of the Senate Comm. on the Judiciary, 69th Cong., Ist Sess. 68-69 (1926) (state- ment of O.G. Brown, Council of American Shipbuilders and the New York and New Jersey Dry Dock Association) (1926 Senate Hearings).* The provision was modeled on > Both the Senate and the House considered bills requiring approval of claims for “legal services” for claimants’ representatives. See H.R. 9498, 69th Cong., Ist Sess. § 38 (1926), reprinted in the 1926 House 14 an early New York worker’s compensation law, see Banks v. Chicago Grain Trimmer’s Ass'n, 390 U.S. 459, 466 (1968), that was intended to “insure as large a return to the injured workman in compensation for injuries incurred in the course of his employment as possible.” Jn re Fisch, 188 App. Div. 525, 177 N.Y.S. 338, 341 (1919). The Black Lung Benefits Act has included the LHWCA fee provision since its enactment in 1969. See Federal Coal Mine Health and Safety Act of 1969, Pub. L. No. 91-173, Tit. IV, § 422, 83 Stat. 796.4 As with LHWCA claimants, Hearings, supra, at 11; S. 3170, 69th Cong., Ist Sess. § 38 (1926), reprinted in 1926 Senate Hearings, supra, at 11. The attorney for the International Longshoremen’s Association proposed a criminal sanc- tion, modeled on New York’s worker’s compensation law, to strengthen the fee provision. 1926 House Hearings, supra, at 40. The attorney for the Council of American Shipbuilders and the New York and New Jersey Dry Dock Association pointed out that limiting ap- proval requirements to “legal services” allowed non-lawyers to exploit injured workers and suggested that only lawyers be allowed to repre- sent claimants. 1926 Senate Hearings, supra, at 68-69. The Senate later passed a bill incorporating a criminal sanction and requiring ap- proval of claims for legal services “or for any other services rendered in respect of a claim,” 1926 House Hearings, supra, at 129; the full provision of that bill was enacted without change in 1927. In 1972, when Congress added a fee shifting provision to Section 28, it re- affirmed the principle that “no fee may be received unless approved” by the appropriate court or administrative official. H.R. Rep. No. 1441, 92d Cong., 2d Sess. 21 (1972). 4 The fee provisions, and other portions of the Longshore .tatute, were added to Part C of the black lung statute in conference. See H.R. Conf. Rep. No. 761, 91st Cong., Ist Sess. 89-91 (1969). During debate on the conference report, supporters of the legislation uniformly stated their intent to incorporate into Part C the enumerated Long- shore provisions. See 115 Cong. Rec. 39,707, 39,709 (Rep. Perkins), 39,712-39,713 (Rep. Dent); 39,718 (Rep. Burton); 39,996 (section-by- section analysis of the Conference Report, presented by Sen. Williams); 39,999 (Sen. Javits). 15 black lung claimants are susceptible to exploitation because they typically have limited education. See U.S. Department of Labor, Employment Standards Admin., A Sample Survey of All Sources of Both Monetary and Non- Monetary Income of Black Lung Beneficiaries 14 (1983) (while some widows have more education, three-fourths of miners did not attend high school). “[RJational paternal- ism” in restricting fees is a proper legislative purpose (Walters, 473 U.S. at 323), especially when, as in this in- stance, the claimant population is susceptible to exploita- tion that might deprive them of their full share of benefits. This Court long ago recognized the legitimacy of pro- tecting claimants “against improvident contracts, in the in- terest not only of themselves and their families, but of the public.” Yeiser v. Dysart, 267 U.S. 540, 541 (1925) (up- holding provision in Nebraska worker’s compensation statute requiring approval of fees charged a claimant). The court below gave that congressional policy short shrift be- cause of its view that “under the current system the claim- ant seldom has an award to share.” See App., infra, 21a. Like the district court in Walters (473 U.S. at 323), the West Virginia court erred by “cavalierly dismissing” Con- gress’s long-asserted purpose. The court also erred by ignoring the impairment of other government interests that would flow from its pre- ferred fee system. The court suggested that the Depart- ment could adopt a statewide “multiplier” to compensate claimant’s attorneys for their risk of loss. App., infra, 25a. But that approach would drive up costs to operators and, more particularly, to the Black Lung Disability Trust Fund, which is already some $3 billion in debt to the federal treasury. See /d. at 39a. Moreover, it is unclear what kind of a multiplier would be permissible in view of this Court’s opinion in Pennsyl- 16 vania v. Delaware Valley Citizens’ Council for Clean Air, 107 S. Ct. 3078 (1987), where four Members opposed any risk of loss enhancement in fee-shifting arrangements (id. at 3087) and a fifth Member found an enhancement per- missible only when limited to the range necessary to attract competent counsel in the local market (id. at 3090-3091 (O’Connor, J., concurring)). Judging from the experience of lower courts, see, e.g., Student Public Interest Research Group v. AT&T Bell Laboratories, 842 F.2d 1436, 1451-1452 (3d Cir. 1988), the court’s proposed multiplier would likely lead to expensive and counterproductive litigation over fees. See also Levins v. Benefits Review Board, 724 F.2d 4 (ist Cir. 1984) (employers have due process rights to hearings to contest attorney’s fees). Likewise, the court’s proposal (App., infra, 25a) to allow contingent fees would defeat Congress’s purpose of pre- serving as much as possible of the pool of benefits for the claimant. Those problems underscore the government s in- terest in adhering to the present system, which fairly com- pensates claimants’ attorneys without the complications caused by the alternatives proposed by the court.’ b. Given the weight of these government interests, as the dissent here recognized, “{iJt would take an extra- ordinarily strong showing of probability of error under the 5 As discussed above (at 4), the hourly component of the fee — can now take into account the delay in payment, as well as the risk o loss borne by the attorney. See Velasquez, 844 F.2d at 739; ogo 820 F.2d at 1529; Potashnick Construction Co., 812 F.2d at 577. These provisions for delay and risk of loss satisfy the statutory a quirement that a prevailing attorney obtain a “reasonable fie” G U.S.C. 928(a)). Indeed, for meritorious claims, existing procedures could result in a greater attorney’s fee for the claimant’s lawyer than would be available under a contingent fee arrangement. cf . Blanchard v. Bergeron, 109 S. Ct. 939 (1989) (reasonable attorney’s fee under 42 U.S.C. 1983 not limited to contingent fee agreement). 17 present system —and the probability that the presence of attorneys would sharply diminish that possibility —to war- rant a holding that the fee limitation denies claimants due process of law.” App., infra, 34a-35a (quoting Walters, 473 U.S. at 326). There plainly was no such showing here. To begin, the court’s pivotal conclusion—that the fee system had produced a shortage of lawyers—lacks any adequate foundation in the record. The court relied solely on a few attorney affidavits, together with excerpts from congressional testimony expressing a general unhappiness with the fee system and a belief that there was a conse- quent shortage of attorneys. App., infra, 16a-20a. That sort of impressionistic evidence is not sufficient to sustain a finding of unconstitutionality for an administrative pro- gram receiving 7,000 or 8,000 new claims a year —as the Department of Labor says is the case with the Black Lung Program — particularly when the Department presented Statistics showing a 92% rate of representation at the ALJ level. This Court has made clear its rejection of such “anecdotal evidence” to sustain across-the-board findings about the operation of vast federal programs. See, é.g., Walters, 473 U.S. at 324 n.11. The court here failed even to acknowledge the Department’s evidence of the high rate of representation of black lung claimants at the ALJ level, thereby overlooking its obligation to consider “the risk of error inherent in the truth-finding process as applied to the generality of cases.” Walters, 473 U.S. at 321 (emphasis added). Moreover, even assuming that substantial numbers of attorneys are generally unavailable, the court never ade- quately explained how the present fee system bears re- sponsibility for the attorney shortage. The 5% initial ap- proval rate of claims under the 1981 amendments to the black lung statute may well be a significant factor dis- couraging attorney representation (App., infra, 14a n.15, 20a. This low rate derives naturally from Congress’s deci- 18 i 6 i igibility standards in 1981. ion to tighten black lung eligibi | nvm Black Lung Benefits Son ap ope . 97-119, 95 Stat. 1643 (J : siete ann (statement of pre gpa a ace ees : ing a 4% approval rate under the reat attorney interest — menacing rete _ igati ith limi ances : litigation area with limited c an i buted to the fee sys result cannot rationally be attri eae a Similar! , the court erroneously seize | vnc tana aed ~ wa ge viele veound _ ilability of c key reason for the unavai ee. ji . Delays also exist for claims ad) (App., infra, 20a). De eon i i law that are more fa under earlier versions of the |! om dely available to ha claimants—and attorneys are wi Syren | the Backlog_in such claims. See Investigation of sora j Subcomm. on Cases: Hearings Before the rt ow of the House Comm. on Education and rp 99th Cong., Ist Sess. 103 (1985) ewe 4 sone Soa es . . ; ay ; , counsel for District 28, UM el pints is not the determinative factor in any attorney shortage that may exist.’ 6 Of course, Congress’s choice to tighten eligibility Sree Po no due poe question. See Schweiker v. Wilson, 450 U.S. ' 1981). : : , pile and the Department of Labor = eee bow resulting from the 1978 amendments to the blac re ome ae ired the reopening of about 200,000 claims. by the U.S. presi ble Donald J. Pease, House of Representatives, by the rn pune nee Office, Adjudication = ew ~~ : — ae pony ag rhe ccm has made eam ae my ape the backlog at the ALJ level, though de = sill exist at the Benefits Review Board. See Oversight a, a peter seat of the Black ne shy ceePsemsatyy B iieenaion poy pode 9 oo A (1988) (statement of Rep. Wise). an , . I Ne —_ : | 19 The court also marshalled no persuasive evidence to show that in the “generality of cases” (Walters, 473 U.S. at 330), attorneys materially improve the results for black lung claimants. In its initial opinion, the court relied ex- Clusively on the experiences of the handful of claimants represented by respondent. The court found it significant that after retaining respondent as their lawyer, those claimants had obtained benefits that had been previously denied. App., infra, 22a. But even if the improved results in those few cases were attributable to respondent’s ef- forts, there was no basis for the court’s speculation that these claimants “can probably be taken as representative of most claimants.” Jbid. Moreover, in its opinion on rehearing, the court serious- ly misconstrued the Department’s statistics as showing that lawyers necessarily produce a better outcome for claim- ants. Jd. at 40a (characterizing the Statistics as “con- Clusively demonstrat[ing] that at the [ALJ] level, claimants represented by counsel have a likelihood of prevailing that is 2.5 times greater than claimants appearing pro se”). The Department’s figures do not support any inference that at- torneys were the reason for the difference in outcome noted by the court. Most critically, almost all (92%) of the claimants were represented by counsel and Only a small percentage of the claimants proceeded pro se. That fact significantly undercuts the use of comparative success rates as a ground for concluding that pro se claimants win less frequently because they lack lawyers. An equally likely explanation of the results is that the pro se claimants sim- ply failed to attract lawyers because their Cases were not strong enough. Compare Lassiter v. Department of Social Services, 452 U.S. 18, 29 n.5 (1981) (similar statistics were “unilluminating”). Even if the fee system discourages representation in such marginal cases, it remains true that “a process which is sufficient for the large majority of a 20 group of claims is by constitutional definition sufficient for all of them.” Walters, 473 US. at 330. i c. Finally, by giving too much weight to the priv i terest affected, the court erred in its nee : — ba “s i Walters an ' n the Mathews test. In both W aa ca stressed that the disability benefits involved por not based on need, nor did they — a recipient’s sole means of wines a8 et somes pew : a i ack lu The court’s efforts to categorize hae i ts in Goldberg v. imilar to the subsistence welfare benefi ! poe mye this Court’s previous assessment . on relative weight of disability gna “ mse ne M a _ As the Court explain in Ma { U.S. 340), the unusually heavy weight given ve pep — ique na in Goldberg came from the uniqu ee i the very margin “assistance * * * given to persons on the | rer ***” Terminating aid may a on eligible recipient of the on - neg + ep wo oo its.’ ” Ibid. (quoting Golaverg). we the an of * * * virtually anyone else whose pararcictie entitlements are ended. ae Goldberg; ellipsis in Mathews). Here, as in a a disability benefits sought are but one form o ” = aid that claimants may seek. Id. at 342. Thus, the cou a low erred in placing black lung benefits on the same p as the welfare payments in Goldberg. y . —— . t ® Additionally, the court appeared to believ- a ee applicants for benefits, who have not yet been found lig cd = ~ 2 rty” interest in benefits as current recipients, ~~ me Pi eli ible for benefits under an entitlement program. - pret held that applicants have any property interest at al aa i satis hanentailial much less that an applicant's ee is pe a recipient’s. See Lyng v. Payne, 476 U.S. 926, 942 (1986). 21 In sum, the lower court erred by ignoring or trivializing important government interests, overemphasizing claim- ants’ interests, and failing adequately to assess the effect of the fee system on the availability of claimants’ at- torneys. The court’s determination that the black lung fee system violates the due process rights of claimants rests on an entirely inadequate factual record, and should be reversed. ° 2. The court’s declaration that the black lung fee system is unconstitutional allows West Virginia attorneys to enter into fee arrangements with black lung claimants without the risk of state bar disciplinary sanctions. At- torneys may thus charge claimants contingent fees, con- trary to the Department’s regulations and to the intent of Congress that a claimant’s contested award be preserved intact for the claimant. Also contrary to the statute, at- torneys may charge fees to claimants who will never even receive benefits. _ West Virginia is an important state for such a gap in protection to emerge. The Department of Labor informs us that, in fiscal year 1987, approximately 18% of the 8,292 black lung filings arose in West Virginia, and it esti- mates that a comparable percentage of the approximately 7,000 benefit filings in fiscal year 1988 were in that State. The court’s decision therefore affects attorneys who han- dle almost one-fifth of the claims filed in the black lung program. * The alternative theory advanced by the court —that it was uncon- stitutional for the Department to administer a process that denied claimants access to benefits that Congress has provided —simply restates the due process claim in a different guise and therefore has no “independent significance.” ‘Walters, 473 U.S. at 335 (rejecting claim that the $10 fee limitation violated the First Amendment because that claim is “at base, * * * inseparable from the[] due process claim”). 22 Removing the state bar’s disciplinary proceedings as a sanction will significantly damage the Department of Labor’s ability to protect claimants from inappropriate and unlawful fees. The Department advises us that it relies on such proceedings as the primary means of enforcing the black lung fee requirements. Existing regulations are un- likely to fill the void left by the court’s holding here. As a practical matter, the Department's multi-level, case-by- case system of adjudication is simply not equipped to undertake an investigation into conduct that typically in- volves multiple claimants and comes to light after claims have been finally adjudicated.'® Moreover, criminal pros- ecution is not an effective tool to deal with unlawful fee arrangements. Indeed, while the LHWCA authorizes fines or imprisonment for unauthorized fee activities (33 U.S.C. 928(e)), that provision has been held not to be incor- porated into the black lung statute. United States v. Carter, 760 F.2d 266 (4th Cir. 1985) (per curiam).'! 10 As discussed above (at 4), black lung claims and fee petitions are processed first by deputy commissioners in the Office of Workers’ Compensation Programs (OWCP) and may then go to ALJs and the - Benefits Review Board. Deputy commissioners have general authority to issue “appropriate orders” (20 C.F.R. 725.351(a)(5)), but such a provision may not be specific enough to allow discipline. See Camp v. Herzog, 104 F. Supp. 134, 137-138 (D.D.C. 1952); J. Stein, G. Mitchell & B. Mezines, Administrative Law § 42.02(1}, at 42-17 (1987). While an ALJ has authority to exclude an attorney from the proceeding because of unethical or improper conduct (29 C.F.R. 18.34(g)(3)), the provision has not been tested as a general means of enforcing the fee requirements. The Benefits Review Board may ex- clude attorneys whose conduct merits a suspension or loss of license (see 53 Fed. Reg. 16,519 (1988), adding 20 C.F.R. 802.202(e)), but this provision cannot be used against West Virginia lav yers in light of the Supreme Court of Appeals’ decision here that violations of the Department’s regulations are not unethical. '! It is also generally difficult to prove that entering into a fee agree- ment satisfies the elements, for example, of mail fraud or obstruction 23 It is difficult, of course. to j ; » to predict the extent to whi ne - — will encourage noncompliance Fe a irements either in West Virgini where. But based on past experi i eo. But! perience in the black lun - ~~ = on some lawyers will take cannot ee me — entering _ unsupervised fee ar- 7 y years, the black lung s nessed certain lawyers “soakin i lie toe ! Oal miners with f. for very little work” (see H C on ng ouse Comm. on Ed i 2 ucation and a a a eo ssc Benefits Reform Act and enue Act of 1977, at 1(C Print 1979) (Statement of R , — ep. Heckler)), and the De ment advises us that it continues t onl i to see attorneys enteri — contingent fee agreements or other et ig ey See, e. g., Wells v. Director, Office of ne i —e Programs, 9 Black Lung Rep -63 (Ben. Rev. Bd. 1986); In re Shoemak : ; er, 11 Black pi Rep. 3-145 (ALJ 1988); Taylor v. Director, Office of ers’ Compensation Programs, 11 Black L 3-184 (ALJ 1988),2 — As a practical matter, while isi ) ca A the decision below will directly prohibit the Department from enforcing its a of justice (see 18 U.S.C. 134] ; =. » 1505; cf. RXs 16,17: A i pa beg ten ieee conduct did not pace” tg > eve Ss happened here, the threat of pro i ; in an attorney's agreement to reimburse clients, te Bie te "Fe hearing before Commi ttee on Le j : pre-trial diversion). gal Ethics concerning respondent’s 12 : . aus be [ney rtm case substantiates the prevalence of such con- before the State Bar: “I thint Oy respondent's attorney at the hearing of edema nae ~ think we all know that it’s something that a lot these Black Lun ims taking their contingent fee contracts on fatmnar tianlian ~ es ); Tr. 178 (testimony by Floyd Gibson. a feeling, discussed prsnrene ieaanaee nye “yey strong not have any business regulating bateamuten’” os 24 regulations, it threatens to expose black lung claimants to precisely the harms that Congress has sought to prevent. It is not for the courts to revise Congress’s economic and social policies under the aegis of general constitutional guarantees, particularly on a factual record as frail as the one here. The policy choices in the black lung program reflect a careful balance of competing values, after ex- amination by Congress and by the agency charged with ad- ministering the program. Courts should not use the Due Process Clause as the vehicle for redetermining federal policy with respect to the reasonable regulation of at- torney’s fees. CONCLUSION The petition for a writ of certiorari should be granted. Respectfully submitted. WILLIAM C. BRYSON Acting Solicitor General JOHN R. BOLTON Assistant Attorney General DAVID L. SHAPIRO Deputy Solicitor General MICHAEL R. DREEBEN Assistant to the Solicitor General WILLIAM KANTER JOHN S. KOPPEL JERRY G. THORN Altorneys Acting Solicitor of Labor Department of Justice ALLEN H. FELDMAN Associate Solicitor MARY-HELEN MAUTNER Counsel for Appellate Litigation EDWARD D. SIEGER Attorney Department of Labor APRIL 1989 APPENDIX A IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA No. 18396 COMMITTEE ON LEGAL ETuics OF THE WEST VirGINIA STATE BAR Vv. GEORGE R. TRIPLETT [Filed Oct. 26, 1988] Chief Justice McHu : ; gh and Justice Miller dj reserve the right to file a dissenting Prasad me a Disciplinary Proceeding Attorney Exonerated NEELY, Justice: This is a disciplinar i lary proceeding brought b tc on Legal Ethics of the West Virginia Prd — on ee ) against George R. Triplett, a member of the - The Committee has recommended a six mo 2a i = lawyer shall not: (4) 1-102 — Misconduct (A) a en in conduct involving dishonesty, f —— or misrepresentation; (5) Engage in conduct prejudicial to the administration of justice; (6) Engage in any other conduct that adversely reflects on his fitness to practice law. 7 | i ide by regulations promut espondent failed to abide Be am the federal Black Lung Benefits nd - U S.C. 901, ef seq., for the collection of attorneys lung cases. . coo ceniuaene at issue in this proceeding require that any attorney fee be approved by the Department of Labor; £ contingent fees are prohibited. Mr. ry not ~ Se clients to execute dryer = od ne son “op soa ent of accru nefits. : erg pe approval for these seengnners = _—_ - fee whatsoever from the Department. agi evailed, they paid Mr. Triplett, who put —— be k accounts in his name as agent, trustee, or “attor y se escrow” for the individual clients.’ The committee ; : found the respondent guilty of geome romper reflecting on his fitness to practice law in vio ation 1-102(A)(4), (5) and (6). | Introduction initiated when a miner files a claim k lung cases are! es a ian Renan of Labor (DOL). The claim is then i ong the i that he heard discussion am aol regulations might be changed to allow he money into escrow accounts i fees and, therefore, he putt on per eg time. Record at 235, 257-8, 269. Respondent has turned all of the fee money, with interest, to his clients. ' Respondent test plaintiffs bar that the ee eee ct ene Ts la — 3a reviewed at the administrative level by a claims examiner or the deputy commissioner, and approved or denied after a medical examination by a DOL doctor. The claimant and defendant operator (if one can be identified) are then allowed to submit additional evidence and have the case reconsidered, again at the deputy commissioner level. Either side can then appeal the decision of the deputy com- missioner to the Office of Administrative Law Judges (OALJ) and, from that decision, appeal to the Benefits Review Board (BRB). Appeal from a decision of the BRB lies in the U.S. Court of Appeals for the circuit in which the injury (last exposure) arose. 33 U.S.C. § 921(C). Bene- fits are awarded on a finding of total disability or death due to pneumoconiosis (“black lung”), and are payable by either the responsible operator (if one can be identified) or the Black Lung Disability Trust Fund. Who pays the claim depends on a number of factors including whether a responsible operator can be identified, when the claim was filed, and the date of last exposure. Section 932 of the Black Lung Benefits Act (30 U.S.C. § 901 ef seg.) incorporates several provisions of the Long- shore and Harbor Workers’ Compensation Act (33 U.S.C. § 901 et seq.) including 33 U.S.C. § 928 which provides that no one who represents a claimant shall be paid a fee unless it is approved by the deputy commissioner, the board or the court before whom the work is performed. Anyone who receives an unapproved fee is subject to a fine of $1,000 or imprisonment for not more than one year, or both.? If a defendant employer declines to pay compensa- tion within thirty days of receiving written notice of the claim, and the claimant thereafter uses the services of a lawyer to win his claim, the deputy commissioner, the board or the court awards a reasonable attorney’s fee to be 2 33 U.S.C. 928(c) and (e). 4a chanedhpaishonne qusstaaguatate tin tex BUR elt sae oa ae benefits when a claimant oe = the lawyer files a fee petition that, when approved, is p gan screen under the oo oe iy — fas ghee bo ogits air in part: No fee charged for representation services rendered i i laim under this part laimant with respect to any c shall be valid unless approved under this subpart. No e contract or prior agreement for a fee shall b valid. ... ‘ ; ides i rt: 20 C.F.R. § 725.366 provides in pa | . A representative seeking a fee for services “al formed on behalf of a claimant shall make app — tion therefor to the deputy commissioner, administr i tribunal, as judge, or appropriate appellate ' re bs ae be, before whom the services were per formed. The application shall be supported by a Fo. plete statement of the extent and character o necessary work done... ; | The criteria for determining fees are listed gma § 725.366(b).* Subsection (e) of 20 C.F.R. § p 3 33 U.S.C. 928(a). Bapeseyinvte tn h (a) of this section shall be rea- an pont, engin work done and shall i 10 Isic) account the quality of the representation, om aa fc - ns of the representative, the complexity of the lega nawiay nee the level of proceedings to which the claim was “aa ‘ level at which the representative entered the pro- saa pte any other information which may be relevant to the pe fee requested. No fee approved shall include payment a ~~. =~ Cases. The Committee, in a Supplemental Memorandum, argues that any problems associated with black lung fee limitations are irrelevant because they did not charge Re- rather with “, , . misrepresentation to the Department of Labor regarding his intentions to collect a fee.” Complain- ant’s Supplemental Memorandum. However, this argu- ment is not supported by the Committee’s own Full Hear- approval was required and, in several Cases, that he au- thorized the DOL to release to the respective clients the Portion of benefits retained to pay attorneys’ fees. In these cases, Respondent also informed the DOL that he was not going to submit fee applications for their approval. The Committee Says these documents + + are all strong evidence of the knowledge of Re- spondent that the way to have a fee paid for his suc- cessful representation of his Black Lung clients was to file a petition for fees as provided by Section 725.365 of the Regulations. His ailure to abide by the regu- for time spent in Preparation of a fee application. No fee shall be approved for work done on claims filed between December 30, 1969, and June 30, 1973, under Part B of Title IV of the Act, ex- cept for services rendered on behalf of the claimant in regard to the review of the claim under section 435 of the Act and Part 727 of this subchapter. 6a lation make [sic] him guilty of violation of DR 1-102 (A)(4), (5) and (6)... It is evident, then, that the Committee found Réspond- ent’s misconduct to be his knowing violation of the DOL regulations, not his alleged misrepresentation to the DOL regarding his intentions to collect a fee. Moreover, had the Committee stated in its Conclusions of Law that Respond- ent lied to the DOL, such a finding would not have been supported by the record. The evidence establishes that Re- spondent communicated to DOL representatives that he would not submit fee applications to them in most of his cases. There is no evidence in the record that Respondent told the DOL he would not collect fees directly from his clients. In fact, the record suggests that the DOL, at least in one case, suspected the Respondent was collecting fees directly in violation of the regulations because they sent him an admonition against doing so.‘ The gravamen of Respondent’s alleged professional mis- conduct is not statements he made to the DOL, but his col- lection of fees in knowing violation of DOL regulations. The defendant argues in mitigation that the black lung at- torneys’ fees provisions, as they are applied, make it almost impossible for claimants to find competent counsel to represent them. Several lawyers who appeared on be- half of respondent testified about their own experience representing black lung claimants.* These lawyers were, at best, not paid adequately or promptly. Some were not > See State Bar exhibit 3. * Record at 196-198, testimony of William M. Miller stating that he has won three or four cases for claimants but has not been paid in any of them, including a case in which his client was awarded over thirty thousand dollars in back benefits in 1980; record at 206, testimony of James F. Cain stating that he no longer accepts black lung cases due to the difficulty of getting paid. Il The Constitutional Issue Due Process Analysis under Walters : “apie The fee limitation was first enacted in 1862 during the Civil Wa r. 8a tion, the Supreme Court pointed out that due process Is . flexible concept that requires a balancing of interests; thus, there is no absolute right either to a trial-like pe or to representation by counsel in every genoa 3 t ns adjudicates a property right. More specifically, Y - applied the test set out in Matthews v. Eldridge, 4 S. 319 (1976): | | | _ . . which requires a court to consider the private in- terest that will be affected by the official action, the risk of an erroneous deprivation of such = through the procedures used, the probable value » additional or substitute procedural safeguards, an the government’s interest in adhering to the existing system ... In applying this test we must keep in mind, in addition to the deference owed to Congress, the fact that the very nature of the due process inquiry indicates that the fundamental fairness of a particular procedure does not turn on the result obtained in any individual case; rather, “procedural due process rules are shaped by the risk of error inherent in the truth- finding process as applied to the generality of cases, not the rare exceptions.” [citations omitted] 473 U.S. at 321. The Court went on to conclude that the government interest in the fee limitation in veterans cases was to ensure: , 7 _. . that the system for administering benefits should be managed in a sufficiently informal way that there should be no need for the employment of an attorney to obtain benefits to which a claimant was entitled, so that the claimant would receive the entirety of the award without having to divide it with a lawyer. [cita- tions omitted] Id. 9a mee In Walters, the Court pointed out that destruction of the fee limitation in VA cases would result not only in claimants’ paying over part of their Lenefits to lawyers, but would also complicate a process that Congress intend- ed to keep uncomplicated and non-adversarial. The result- ing transformation of the current VA system to a compli- cated, adversarial one would then virtually require claim- ants to hire lawyers to be successful. 473 U.S. at 323-324. The increased complexity, in turn, would require greater administrative costs, which would leave less money avail- able for benefits. Accordingly, the Court reasoned, the government interest in the fee limitation was entitled to great weight. To prevail against such a reasonable con- gressional policy required an “. . . extraordinarily strong showing of probability of error under the present system — and the probability that the presence of attorneys would sharply diminish that possibility . . .” 473 U.S. at 326. The Court frankly admitted in Walters that it was not possible to quantify exactly the danger of erroneous depri- vation under the present system. However, the Court was quick to point out that only 16 percent of the cases that are appealed to the Board of Veterans Appeals (BVA) are re- versed, which suggests a relatively low danger of errone- ous deprivation if one assumes the BVA decision to be the “correct” result in every case. 473 U.S. at 327. In Walters, the court made an important factual finding that lifting the fee limitation would not significantly re- duce the danger of erroneous deprivation of--veterans’ benefits. For this finding the Court relied on statistics cor- relating the rate of ultimate success by claimants before the BVA by mode of representation. These Statistics demonstrated that claimants who were represented by lawyers (pro bono) were only marginally more successful than pro se claimants or claimants represented by veterans’ 10a organizations.* The Court noted that various veterans’ ser- vice organizations supply high quality representation for any claimant who requests it regardless of a claimant’s af- filiation with a veterans’ organization. 473 U.S. at 311-312. Congress had recently considered proposals to modify the fee limitation, and a Senate Committee report in 1982,° stated that body’s concern “that any changes relating to attorneys’ fees be made carefully so as not to induce unnecessary retention of attorneys by VA claimants and not to disrupt un- necessarily the very effective network of non-attorney resources that has evolved in the absence of signifi- cant attorney involvement in VA claims matters.” 473 U.S. at 322. The Court in Walters specifically rejected the veterans’ argument that the Veterans Administration’s procedures are so complex, procedurally and factually, that they re- quire lawyer representation of claimants. Although the Court conceded that cases of agent orange or radiation ex- posure might be considered “complex,” these cases consti- ‘ The following statistics were taken from the record and relied upon by the Court. 473 U.S. at 327. ULTIMATE SUCCESS RATES BEFORE THE BOARD OF VETERANS APPEALS BY MODE OF REPRESENTATION American Legion 16.2% American Red Cross 16.8% Disabled American Veterans 16.6% 16.7% Veterans of Foreign Wars Other non-attorney 15.8% No representation 15.2% Attorney/Agent 18.3% ® The proposed bill allowed limited judicial review of BVA deci- sions and payment of attorneys’ fees for representation in that review, but the bill was never enacted. 473 [U.S.] at 322, note 10. lia tuted, at most, two percent of a st, “re ppeals to the BVA. In con- ae with the principle that the fundamental litte ee depends on the risk of error inherent in the 7 - re ng process as applied to the generality of cases ror than the rare exceptions, the Court was not per- Pe tem the VA process should be changed to accom- rar . ” “ ” ~ araoe € exception” of “complex” cases. 473 U.S. Finally, the Court examined 7 the nature of the remy : er In Goldberg v. Kelly, 397 U.S 254 i370, ourt held that a welfare recipient subje ible termination of benefits was entitled may corey ) . to a lawyer. In Mat- a ve Eldridge, supra, the Court held that nana nes, . lisability benefit recipients had no right to a pre-termi- pgp gore a The Court found that the bene- pr ings, which are not the basis of need, are closer i Diane ‘ to the social security be By in than they are to welfare payments “ ae ‘h the recipients in Goldberg d heir dai subsistence.” 473 U.S. at 332-333. ~ esemianaemiiaaed IV History of Black Lung Legislation There currently exists in the State of West Virgini . . = ae 0p of elderly, sick coal miners, their seat eir survivors. Many have waited for vii . extend Perk for administrative review of their black _ : oe have had their claims denied, and have sub n unable to obtain i ; ee counsel to review and “ te. py — - demanded of those who extract the life’s irginia’s economy from the arteries j mountains. As his lungs become cl ith insidi ce . Ogged with insidio and pervasive dust, the miner is given a graphic rene 12a of the quality of life that lies ahead. The nature of the disease being progressive, the miner feels himself increas- ingly weakened and helpless, unable to provide even the most modest means of support for his family. The full extent of the debilitating impact of long term exposure to coal dust was recognized with the passage of Title IV of the Federal Coal Mine and Safety Act of 1969.'° This legislation was Congress’ acknowledgement of the failure of state workers’ compensation programs to address the devastating effects of black lung. The original legislation covered only underground miners and their wives or widows, and allowed recovery of benefits only in cases of total disability or death. The original legislation divided claims into Part B claims—those filed before 31 December 1972, to be administered by the Secretary of Health Education and Welfare (HEW), and Part C claims —thiose filed after 31 December 1972. Part C claims were to be administered by the Secretary of Labor under certain provisions of the Longshoreman’s and Harbor Workers’ Compensation Act of 1927.'' Payment of Part C claims was to be made by the responsible operator, or if no responsible operator could be found, from federal revenues. , In 1972, Congress passed the Black Lung Benefits Act'? which amended the earlier legislation. In addition to ex- tending coverage to surface miners and changing some of the eligibility criteria, the 1972 Act postponed Department of Labor jurisdiction to claims filed after 31 December 1973, established a transitional category for claims filed between | July 1973 and 31 December 1973, and required coal companies to carry insurance or to qualify for self- 10 Pub.L.No. 91-173, 83 Stat. 742 (1969). '! 33 U.S.C. § 901 ef seq. '2 Pub.L. No. 92-3-3 [sic], 86 Stat. 153 (1972). a... l3a insurance. The Act also allowed the Secretary of HEW to promulgate regulations to reopen all pending or denied claims and review them under the new legislation. The Secretary established a set of liberal “interim” regulations that caused a surge in Part B approvals. Part B claims were decided without any individual employer liability. See Lopatto, “The Federal Black Lung Program: A 1983 Primer” 85 W.Va.L.Rev. 677 at 686 (1983). The DOL en- countered much difficulty in finding “responsible opera- tors” to pay Part C claims due to the changing structure of the coal industry. In spite of considerable expense and ef- fort by the government, responsible operators were being identified in only twenty-five to thirty percent of the cases. Id. at 689-690. In response to the expense resulting from the surge in approvals without a corresponding increase of responsible operators to pay the claims, Congress passed the Black Lung Benefits Reform Act of 1977'? and the Black Lung Benefits Revenue Act of 1977.'* These amendments estab- lished the Black Lung Disability Trust Fund to be financed by an excise tax on each ton of surface or underground mined coal. In addition, the fund was made liable for all valid Part C claims in which the miner’s last covered em- ployment ended before 1 January 1970. These 1978 amendments also contained liberal eligibility criteria that resulted in a relatively high approval rate. Almost immediately, the Trust Fund became insolvent. The 1978 amendments also directed that all previously denied and pending cases be reviewed under the new criteria. This new review created a large backlog of cases and systemic backlog has continued. Congress amended the legislation again in 1981, raising the excise tax and '? Pub. L. No. 95-239, 92 Stat. 95 (1978). '* Pub. L. No. 95-227, 92 Stat. 11 (1978). l4a restricting eligibility criteria in an effort to make the Trust Fund solvent. The 1981 amendment has resulted in a sharply reduced approval rate for claims. DOL statistics show that for the period January 1982, through March 1988, the number of initial claims filed was 58,680, and the number of final approvals (after appeals to an Ad- ministrative Law Judge and the BRB) was 3,383—a total approval rate of 5.8 percent.'® Vv Black Lung Claims Process and Attorney Fee Provisions Without considering the detailed eligibility criteria and regulations promulgated under each of the amendments discussed in part V, the history of black lung legislation demonstrates that even the filing of a claim for benefits is complex. It often requires a lawyer to determine which benefit structure applies to a particular claim. When re- sponsible operators are represented by lawyers of their choice, at a fee set by whatever agreement they make (there is no regulation of defense attorneys’ fees), and the trust fund is represented by the Office of the Solicitor in the DOL, a claimant who appears without a lawyer is in for a baffling and frustrating experience. Black lung liti- gation has none of the homey, claimant-oriented ambi- ance that one finds in the Veterans’ Administration. 1S See Brief of Amicus Curiae, Jane Moran, DOL Statistics at 4, note 5. Also, a Government Accounting Office report confirr .s that the Office of Workers’ Compensation which makes the initial deter- mination of claims at the administrative level in the DOL approves only about 5% of claims made under the 1981 amendments. Delays in Processing and Adjudicating Black Lung Claims: Hearing Before the Employment and Housing Subcommittee of the House Committee on Government Operations, 9%h Cong., 1st Sess. at 55-56 (1985) (GAO Report HRD-85-19). = oe oe 15a Furthermore, in black lung cases the legislation and regulations specifically contemplate representation by lawyers and, unlike the VA claim process in Walters, for payment of attorneys’ fees. For Part B claims (filed before December 31, 1972), claimants are responsible for the at- torneys’ fees. For claims filed after December 31, 1973, either the responsible operator (if one can be identified) or the Trust Fund is liable for the attorneys’ fees. But in either situation the fee must be approved under 20 C.F.R. §§ 725.365 and 755.366. In our consideration of the constitutionality of the fee provisions, we must examine not only the words of the Statute and regulations, but also the manner of their ad- ministration. In this regard we do not find that the statu- tory requirements assuring “reasonable” fees are unconsti- tutional on their face as a matter of principle; rather we find that the total regulatory scheme is unconstitutionally applied. As the U.S. Supreme Court stated in overturning a state compulsory work statute in U.S. v. Reynolds, 235 U.S. 133 (1914): If such state statutes, upon their face, or in the man- ner of their administration, have the effect to deny rights secured by the Federal Constitution or to nul- lify statutes passed in pursuance thereto, they must fail. [citations omitted, emphasis supplied] 235 U.S. at 149. In Griffin v. Illinois, 351 U.S. 12 (1956) the U.S. Supreme Court held unconstitutional a state law which, in effect, required a transcript to perfect a criminal appeal but did not provide a free transcript to indigents. The Court pointed out that: Dissenting opinions here argue that the Illinois Law should be upheld since by its terms it applies to rich and poor alike. But a law nondiscriminatory on its face may be grossly discriminatory in its operation. 351 U.S. at 17, note 11. l6a As we explained above, 20 C.F.R. § 725.366(a) provides that the claimant’s lawyer should file a fee application with the deputy commissioner, the administrative law judge or the Benefits Review Board for the services performed before that individual or tribunal. The fee is then to be determined from the information provided in the applica- tion and in accordance with the criteria provided in 20 C.F.R. § 725.366(b). In addition, the Benefits Review Board has ruled that the contingent nature (i.e., risk of loss) of the litigation may be included as a criterion under the provision in part (b) that allows consideration of “any other information which may be relevant to the amount of fee requested.” Risden v. Director, BRB No. 78-488, 11 BRBS 819 (1980). Although 20 C.F.R. § 726.366(b) appears to provide for attorneys’ fees that will fairly compensate competent counsel, thus guaranteeing claimants’ due process rights, an examination of the factual record before us reveals that this is not the case. Numerous attorney affidavits filed in this case as well as testimony before the House of Repre- sentatives Subcommittee on Labor Standards establishes that the attorney fees policy of the DOL discourages lawyers from representing black lung claimants so that many claimants, with cxses of at least arguable merit, are unable to find counsel to represent them. vi Actual Implementation of the DOL’s Attorneys’ Fee System The DOL will not award any attorneys’ fee until a “final” decision has been made in a case. See 33 U.S.C. § 928(a) and Thompson v. Potashnick, 812 F.2d 574 (9th Cir. 1987). Although a claimant may prevail before the Deputy Commissioner and Administrative Law Judge (assuming an appeal is taken at each stage) and his at- a . 17a torney files a fee petition that is approved at each stage, the fee will not be paid until after a final decision by the Benefits Review Board (BRB). If the BRB remands the case to the Administrative Law Judge, the attorney must wait even longer for his fee. The record reveals that lawyers wait for years, often five to ten years, before re- ceiving any payment.'* There is no provision in the law for payment of interest on attorneys’ fees.'’? One affiant at- torney states that he is currently owed more than $30,000 in fees that have been awarded but not paid. Brief of Amicus Curiae Jane Moran, affidavit of Robert F. Cohen, Jr. at 7. In a small, depressed West Virginia town $30,000 is a substantial amount of money for an individual practi- tioner. In the long run, as John Maynard Keynes once ob- served, we are all dead. In the short run, lawyers have of- fices to run, mortgages to pay and children to educate. '6 A report by the Government Accounting Office, relying on DOL Statistics, states that 78% of cases disposed of by the Office of Ad- ministrative Law Judges between October 1, 1983, and August 21, 1984 took more than two years to adjudicate. When time is added for the initial administrative determination as well as an appeal to the BRB, it is clear that it does, indeed, take years to resolve a claim. Delays in Processing and Adjudicating Black Lung Claims: Hearing Before the Employment and Housing Subcommittee of the House Committee on Government Operations, 99th Cong., Ist Sess. at 41 (1985) (GAO Report HRD-85-19). '? Although the DOL seems cavalier about the fact that lawyers must wait for years to collect fees without also receiving interest on the fees, we note that the Internal Revenue Service is Rhadamanthine in its collection of interest when the U.S. government is a payee rather than a payor. In addition to any penalty that might be properly as- sessed, the IRS collects interest on any overdue or unpaid taxes, even if the taxpayer has been granted an extension of time in which to pay. See 26 U.S.C. § 6601, 26 CFR § 301.6601-1 ef seg. We also note that a responsible operator must pay interest if it fails to pay benefits award- ed either initially by the deputy commissioner, or on appeal. 30 U.S.C. § 934, 20 CFR § 725.608. 18a Another affiant attorney states that the DOL has an in- formal policy'* of allowing a maximum hourly rate of $85.00 for proceedings before the Deputy Commissioner, and a maximum hourly rate of $125.00 for proceedings before the Office of Administrative Law Judges or BRB. Id., affidavit of Frederick Muth at 3. This same affiant states that a typical case will average between two and eight years, depending on the length of appellate litiga- tion, and that because of this factor and the low rate of compensation (in light of its contingent nature), fewer qualified attorneys are accepting black lung claims than are required to process existing meritorious claims. He also points out that “. . . it has become increasingly com- mon to find instances of U.S. Department of Labor hear- ing dockets populated primarily with pro se claimants .. .” and that his law firm has been inundated with pro- spective clients who have been unsuccessful in their efforts to retain competent representation. /d. at 4. Another affiant attorney, employed for five years by the United Mine Workers of America, who has handled black lung cases during all five years, and worked exclusively on black lung cases for two years, states that few attorneys are willing to represent black lung claimants due to the risk of no recovery (and, therefore, no fee). This affiant also points out that because a lawyer generally accepts the case before either parties’ medical evidence is complete, the lawyer is usually unable to assess the merits of a black lung claim until after he agrees to represent the claimant. Fur- thermore, it is nearly impossible to handle a few cases on a pro bono basis because the complexity of black lung liti- gation requires a level of expertise that is consistent only '® The DOL does not have a formal policy establishing a maximum hourly rate. Ashmore v. Director, BRB No. 79-639, 3 BLR 1-374 (1981). 19a with a large number of cases due to the enormous invest- ment of time necessary to learn the law and keep current with changes.'® In 1985, the House Subcommittee on Labor Standards?° held several hearings in coal regions to study the problem of the systemic backlog of black lung cases. Two lawyers who testified before the Subcommittee in Wise, Virginia, who have been representing black lung claimants since the first law was enacted, provided ten specific examples where fees were approved, but no payment was received for at least two years, and in some cases, for five years or more.?' Another lawyer testified that there are 26 cases in his office in which fees were awarded but not paid for more than three years.?? Even if we assume that these ex- amples are “exceptional” in some way, the very existence of “exceptional” cases in which lawyers are required to subsidize the operation of the federal government must have a chilling effect on lawyer willingness to enter the system. Finally, one lawyer testified that many of his colleagues had “. . . stated unequivocally that they would not take black lung cases because of the delay in receiving the pay for their work as well as the possibility that they may re- ceive no fee at all.”?3 Virtually all of the lawyers who testi- fied before this subcommittee stated that they rarely, if ever, took black lung cases due to the long delay before a '9 See Appendix A. 20 Subcommittee of the House Committee on Education and Labor. 2! Investigation of the Backlog in Black Lung cases: Hearings before the Subcomm. on Labor Relations of the House Comm. on Education and Labor, 99th Cong., Ist Sess. 82-83 and 88-89 (1985). 22 Id. at 194. 23 Id. at 188. 20a decision, the additional delay in having fees paid, and the uncompensated risk of receiving no payment, particularly in light of the significantly lower approval rate under the 1981 eligibility rules. It is hardly surprising then, that most lawyers, at least most who have any choice, choose to handle cases that do not require a five year delay for fee payment. The two fac- tors that currently keep most attorneys from accepting black lung cases are the long delay in payment, without any provision for interest, and the lack of premiums to offset the contingent nature of the work. This latter factor has become increasingly prominent as the approval rate has steadily declined following the enactment of the 1981 amendments. DOL statistics demonstrate an approval rate for claims decided under the 1981 law of 22.7% for claim- ants before the Administrative Law Judges, and an overall approval rate of 5.8% .?* This approval rate is significantly smaller than that for VA claims,?5 and demonstrates not only the necessity of lawer representation, but the substan- tial risk that a lawyer will receive no fee at all for his work. Vil Application of Walters Criteria to Black Lung Litigation When the criteria set forth by the U.S. Supreme Court in Walters to assess the constitutionality of fee limitations are applied to black lung cases, it becomes apparent that the Fifth Amendment’s due process clause requires that the provisions for awarding attorneys’ fees in black lung cases-must, in fact, allow claimants representation by competent counsel. 24 See supra, note 15. 25 Of 800,000 VA claims in 1978, more than 400,000 were allowed at the initial level and approximately 14,400 more were allowed after appeals. Walters, 473 U.S. at 309. A EAS NR So om 2la When the Court in Walters examined the nature of the government interest in limiting fees in veterans’ cases, it found that the purpose of the limitation was to avoid lawyers’ needlessly sharing claimants’ benefits. The Court found that VA procedures are designed to be non-adver- sarial, and that if lawyers become involved on a large scale a more complicated and adversarial process will evolve without any improvement in terms of rates of error over the current system. However, in black lung litigation, it is clear that Congress intended that lawyers be used by claimants because it specifically provides for lawyers, and for payment of a “reasonable” attorney’s fee. 33 U.S.C. § 928. And although the VA benefits process is relatively simple and non-adversarial, the black lung process is both complex and adversarial.?® The government interest in requiring approval of at- torneys’ fees in black lung cases is to ensure that neither the responsible operator nor the Trust Fund will be over- charged. The prohibition against direct agreement be- tween a claimant and his lawyer is to protect claimants from improvident agreements that needlessly deplete their benefits. See Moore v. Califano, 471 F.Supp. 146 at 149 (1979). Unfortunately, the result of these regulations has been to make lawyers almost entirely unavailable to claim- ants. Indeed, although the ordinary claimant is not called upon to share his award with a lawyer, under the current system the claimant seldom has an award to share. This turns our attention, then, to the second factor the Court analyzed in Walters, namely, the risk of erroneous deprivation of benefits under the existing VA procedure, and the probable value of additional or substitute safe- guards. Relying on the statistics before it in Walters (supra, note 8), which demonstrated that claimants with 26 See discussion, supra, at Sections IV and V. 22a lawyers are only marginally more successful in VA cases than claimants without lawyers, the Court found that allowing claimants free access to lawyers would not sig- nificantly increase the number of prevailing claimants. Factually, this is decidedly not the situation in black lung cases. The black lung claims process is procedurally, factually and legally complex. Furthermore, at least in cases where a responsible operator is potentially liable for benefits, it is viciously adversarial.?”? Unfortunately, we do not have be- fore us the kind of statistical evidence that the Court had in Walters. However, the Respondent’s clients can prob- ably be taken as representative of most claimants; they were all refused benefits before they reiained Respondeni who then won their cases.?* Ironically, a responsible operator is free to retain lawyers to resist claims. Because benefits are expensive, operators often oppose claims vigorously.?® In causes where the award will be paid by the 27 Although the Office of Workers’ Compensation in the Depart- ment of Labor (which is responsible for ihe initial decision of black lung claims) approves only about 5% of claims filed, responsible operators appeal more than 90% cf these approvals to the Office of Administrative Law Judges. Of the 95% of the claims denied, appli- cants appeal about 40% to the OALJ. Delays in Processing and Ad- judicating Black Lung Claims: Hearing Before the Employment and Housing Subcommittee of the House Committee on Government Operations, 9%h Cong., Ist Sess. at 55-56 (1985) (GAO Report HRD-85-19). 2* Record at 34, 66-70, 82-83, 95, 111, 138-9, and 152. 29 Brief of Amicus Curiae, Jane Moran, affidavit of Robert Cohen at 8-9, affidavit of Frederick Muth at 5-6. “The actuarial value of a 1982 claim by a living miner with a spouse is nearly $150,000 dollars.” Lopatto, “The Federal Black Lung Program: A 1983 Primer,” 85 W. Va.L.Rey. 677 (1983) at 086, citing actuarial chart in Black Lung Benefits Act Annuai Report, U.S. Department of Labor 33 (Jan. 198i). a a A A 23a Trust Fund, the Fund is represented by lawyers from the DOL Office of the Solicitor. Finally, although the veter- ans’ service organizations provide knowledgeable repre- sentatives to aid claimants for VA benefits, a fact that greatly impressed the Court in Walters, no such system of alternative representation exists to aid black lung claim- ants.3° Therefore, lawyer representation is virtually essen- tial to prevent erroneous deprivations of benefits for vic- tims of black lung. The third 2nd final factor considered by the Court in Walters was the nature of the private interest at stake. The Court found that VA benefits are more akin to the social security benefits considered in Matthews than they are to the welfare benefits considered in Goldberg.*'! Because 3® Although the United Mine Workers of America (UMWA) has provided substantial representation for claimants in the past, District 31 of the UMWA, one of three districts serving West Virginia, has ceased such representation due to lack of money. Brief of Amicus Curiae, Jane Moran, attached letter of January 26, 1987 from Eugene Claypole, John Darcus and James Slusser of UMWA. 3! The District Court in the Walters case held that applicants for benefits, no less than persons already receiving them, have a “prop- erty” interest if the applicants meet the statutory criteria for benefits. The Supreme Court has thusfar held only that a recipient of benefits has a “property” interest in their continued receipt. Since at ‘east one of the claimants in Walters alleged a diminution of benefits already being received, the Court did not decide whether a mere claimant has a “property” interest in his prospective benefits. 473 U.S. at 320, note 8. Respondent Triplett represented one claimant from whom the govern- ment sought repayment of an alleged overpayment of benefits. Record at 100-102. Because this client clearly had a vested property interest in these benefits, we need not rule on the nature of a claimant’s property interest in prospective benefits, a question the Supreme Court has so far deferred. However, we here siate our belief that a claimant who meets all the criteria making him eligible for benefits should not be deprived of due process safeguards simply because he is not already receiving benefits. Black lung benefits are not a form of government 24a black lung benefits are awarded only in cases of total disability or ¢d_ath,?? they may well provide the only means of subsistence. This makes them similar to the welfare benefits “... upon which the recipients in Goldberg depended for their daily subsistence.” Walters, 473 U.S. at 332-333. Accordingly, we find that the DOL system of awarding attorneys’ fees does, in fact, severely restrict claimants’ ability to find competent lawyers to represent them, and, therefore, the system violates due process in accordance with the decision of the U.S. Supreme Court in Walters. Alternatively, there is an independent basis for finding a violation of due process in a fee l'mitation scheme that ef- fectively denies claimants the right to benefits granted by Congress. It is fundamentally unfair for the government to confer a right with one hand, and take it away with the other hand. As Chief Justice John Marshall said in Mar- bury v. Madison, 5 U.S. (1 Cranch) 49 (1803): “In all other cases,” he says, “it is a general and in- disputable rule, that where there is a legal right. there is also a legal remedy by suit, or action at law, when- ever that right is awarded.” [quoting Blackstone]. . . The goveinment of the United States has been em- phatically termed a government of laws, and not of largesse, but rather are compensation for which the miner has paid ~~ @éarly, either with total disability or death. If due process is truly a flexible concept, as the U.S. Supreme Court has repeatedly held, there can be no justification for an inflexible rule that claimants have no property interest in benefits for which they qualify but which they do not yet receive. 32 The statute has one exception that allows payment of benefits to eligible survivors of a miner who dies before March 1, 1978, and who was employed at least 25 years in coal mines prior to June 30, 1971, unless it is established that when the miner died, he was not partially or totai!y disabled due to black lung. 30 U.S.C. § 921(c)(S) 1981. 25a men. It will certainly cease to deserve this high ap- pellation, if the laws furnish no remedy for the viola- tion of a vested legal right. 5 U.S. (1 Cranch) at 58-59. Congress has conferred upon qualified claimants the right to receive black lung-benefits. Congress has also pre- scribed the remedy (the claims process) to guarantee this right, an essential part of which is the right to counsel. It is, therefore, unconstitutional for the Department of Labor by its regulations to deny qualified claimants the procedural safeguards provided by Congress that are essential to vindicate the right to benefits also granted by Congress. Vinl The Risk of Loss Problem There are several possible ways to award attorneys’ fees that take into account the risk of loss factor in black lung cases. Most directly, the law could provide for a con- tingent fee based on a set percentage of any lurip sum awarded, as the Respondent contracted for in this case. In the alternative, a multiplier could be used to enhance the “normal” hourly fee to compensate for the risk of loss. The U.S. Supreme Court has recently examined the use of “contingen-y multipliers” in the context of fee-shifting Statutes. In Pennsylvania v. Delaware Valley Citizens Council, 483 U.S. _., 107 S.Ci. 3078 (1987), the Court reversed a U.S. District Court’s use of a contingency multiplier to en- hance an award of attorneys’ fees to successful plaintiffs under the fee-shifting provisions of the Clean Air Act (42 U.S.C.S. § 7604(d)). Justice White, writing for a plurality, said “The issue before us is whether, when a plaintiff pre- vails, its attorney should or may be awarded separate com- pensation for assuming the risk of not being paid.” 483 26a U.S. _., 107 S.Ct. at 3081. Although Justice O’Connor joined the plurality to make a majority, she limited her concurrence to the circumstances of the particular case be- cause she concludec that Congress”. . . did not intend to foreclose consideration of contingency in setting a reason- able fee under fee-shifting provisions such as the Clean Air Act...” Id. at 3089. In addition to the mathematical difficulty of computing contingency multipliers, the Court pointed out that one of the strongest objections to them is that “. . . it penalizes the defendant with the strongest defense, and forces him to subsidize the plaintiff's attorney for bringing other un- successful actions against other defendants.” Jd. at 3085, citing Leubsdorf, “The Contingency Factor in Attorney Fee Awards,” 90 Yale L.J. 473 at 488-491. The Court also noted that a contingency multiplier might encourage risky litigation because the less chance there is of prevailing, the higher the multiplier. Jd. at 3086. However, Justice O’Connor, as well as the four dissenting Justices,** argued that this reasoning correctly suggests that awarding con- tingency enhancement based on the merits of a particular case may be undesirable, but the fact that it may be un- desirable in a particular case does not, as a matter of prin- ciple, undercut the substantial justification for contingen- cy enhancement in some types of cases. Jd. at 3097 (Black- mun, J., dissenting). The Court held that enhancement of a fee for the risk of loss in fee-shifting cases should be made only in excep- tional cases when the risk of no recovery is clear from the outset of a case and when, without risk-enhancement, plaintiff “. . . would have faced substantial difficulties in finding counsel in the local or other relevant market.” Jd. at 3089. The Court concluded that these elements were not 33 Justices Blackman, Brennan, Marshall and Stevens. ee ee ee Coe a 27a present in the case before it and held that the District Court’s use of a multiplier in that case was improper. The Court’s decision in Delaware Valley does not pre- clude the use of a contingency multiplier in black lung cases. Delaware Valley applies to cases involving fee- shitting statutes that are different from the attorney fee provisions in black lung cases. Most importantly, fee- shifting statutes do not affect the ability of plaintiffs to enter into whatever contracts they desire with their lawyers and thus increase the lawyer’s ultimate fee beyond the amount awarded under a fee-shifting statute. In black lung cases, however, no contract between a claimant and his lawyer is allowed, so lawyers are forced to accept the risk of receiving no fee at all in the large majority of cases. Furthermore, in black lung cases, when either the claim- ant or the Trust Fund must pay attorneys’ fees, there is no danger of losing defendants’ compensating plaintiffs’ lawyers for not prevailing against other defendants in other cases—the factor that so disturbed the Court in Delaware Valley. Also, it is clear from the evidence before us that the administration of the black lung attorneys’ fee provisions has, in fact, caused claimants to face substan- tial difficulties in finding counsel willing to represent tiem, a factor specifically required by the Court in Delaware Valley for enhancement of fees in fee-shifting cases. Id. IX It is clear from the evidence before us that most lawyers are unwilling to represent black lung claimants because of the inadequate fees awarded by the DOL. On the one hand, it takes a matter of years to litigate a case, and often an additional two years after a successful conclusion for a lawyer to be paid his fee. When there is no provision for interest, and a lawyer faces overhead costs that cannot be postponed, any lawyer will turn his attention to paying 28a cases. In addition, because there is no systematic enhance- ment of fees to compensate lawyers for the risk of loss—a very substantial risk in cases decided under the 1981 law — most lawyers who have a choice will prefer contingent fee cases that provide premiums for risk. We do not suggest what would be the best system for awarding attorneys’ fees in black lung cases. That decision is properly left to Congress and the DOL promulgating regulations pursuant to congressional legislation within the bounds set by the Constitution. We do, however, find that the system as currently administered denies claimants for black lung benefits property without due >rocess of law by severely restricting their right to obtain representa- tion by competent counsel in the highly adversarial process of black lung litigation. The respondent, George Triplett, was forced into mak- ing a tragic choice between conflicting duties. He either had to refuse to represent deserving, disabled miners, run the risk of bankrupting his practice, or violate the DOL regulations. The U.S. Supreme Court stated in Ex Parte Siebold, 100 U.S. 371 (1879) that: An unconstitutional law is void, and is as no law. An offence created by it is not a crime. A conviction under it is not merely erroneous, but is illegal and void, and cannot be a legal cause of imprisonment. 100 U.S. at 376-377. Accord, Norton v. Shelby County, 118 U.S. 425 (1885); 16 Am.Jur.2d § 256.*4 34 Generally we do not believe it is sound practice to cite Am. Jur. because the treatise often states the majority and minority positions on a given issue with equal force. However, we deviate from our general rule here because with regard to the effect of unconstitutional laws, it appears that the weight of authority for the proposition quoted is so overwhelming that there is no minority position. 16 Am.Jur.2d § 256, in relevant part, reads: A le a * ee ae 29a Six black lung clients of Respondent testified at the ethics hearing before the Committee. One client was dissatisfied and said that he never agreed to pay Mr. Triplett anything for his work, although the client testified that the signature of his name on a 25 percent contingent fee contract did appear to be his. Record at 31. The Respondent testified that he explained the fee azreement fully to this client (and all of his other clients) before the client signed it. Record at 144. The other five clients testified that they agreed to pay Mr. Triplett 25 percent of any past benefits they were awarded, and that they were satisfied with Mr. Triplett’s work and felt he deserved to be paid the 25 percent fee. The Respondent put the fee money he received into interest-bearing escrow accounts in the vain hope that the regulations would be changed to allow contingent fee agreements. We do not believe that this constitutes clear evidence of professional misconduct by Respondent. The general rule is that an unconstitutional statute, whether federal or state, though having the form and name of law, is in reality no law, but is wholly void, and ineffective for any pur- pose; since unconstitutionality dates from the time of its enact- ment, and not merely from the date of the decision so branding it, an unconstitutional law, in legal contemplation, is as inoperative as if it had never been passed. Such a statute leaves the question that it purports to settle just as it would be had the statute not been enacted. No repeal of such an enactment is necessary. Since an unconstitutional law is void, the general principles follow that it imposes no duties, confers no rights, creates no of- fice, bestows no power or authority on anyone, affords no pro- tection, and justifies no acts performed under it. A contract which rests on an unconstitutional statute creates no obligation to be impaired by subsequent legislation. No one is bound to obey an unconstitutional law and no courts are bound to enforce it. Persons convicted and fined under a Statute subsequently held unconstitutional may recover the fines paid. [Footnotes omitted] 30a The Committee on Legal Ethics has the burden to prove by full, preponderating and clear evidence that Respond- ent is guilty of professional misconduct under DR 1-102(A)(4), (5) and (6) of the West Virginia Code of Pro- fessional Responsibility. Accordingly, we find the Re- spondent, George Triplett, not guilty of any ethical viola- tion for resisting an administrative system that clearly and unambiguously violates the Fifth Amendment to the Con- stitution of the United States. Because our decision involves an important question of federal law, we grant leave to the Department of Labor to intervene as a party litigant, either for the purpose of filing a petition for rehearing before this Court, or for the pur- pose of prosecuting an appeal to the Supreme Court of the United States. Attorney Exonerated. ae 3la APPENDIX A AFFIDAVIT SUPPLIED BY AMICUS, JANE MORAN I, THOMAS H. ZERBE, being first duly sworn, states as follows: I am an attorney employed with District 17, United Mine Workers of America in Charleston, West Virginia. I have been employed by District 17, U.M.W.A. for five (5) years. During all my five year tenure, I have either handled federal black lung claims or supervised attorneys who handled federal black lung claims. For two (2) years, my work was almost exclusively handling federal black [lung] claims. Currently, | am Director of Benefits, and as part of that job I supervise the black lung attorney as well as handle some claims myself. I am familiar with virtually every attorney in West Virginia who represents clients in federal black [lung] cases. I have spoken personally with many of these at- torneys about the economics of handling federal black lung cases. I have also spoken with clients and ad- ministrative law judges about the problem of claimants, who are not members of the United Mine Workers of America, in getting attorneys to represent them in federal black [lung] claims. The number of attorneys willing to accept federal black lung claims has always been limited, but it has declined even more in recent years. Of those attorneys who do not accept federal black lung cases, many have a policy of ac- cepting them only as a service to clients, whom they repre- sent on other matters. The reason attorneys are unwilling to represent claim- ant’s in federal black lung claims is simple economics. The cases are difficult to win and the fee awards are too low considering the contingent nature of a fee. The federal statute prohibits the attorney from charging the client. If 32a the attorney wins the case, he submits a fee petition based on the number of hours that he has in the claim to the ad- ministrative law judge, who awards attorney’s fees against the defendant. Most of the administrative law judges award an hourly rate that would be generous were i: not a contingent fee, but it is still not enough considering the | contingent nature of the fee and the very low win rate. The win rate for claimants before the Department of Labor ad- ministrative law judge[s] deciding claims filed after January 1, 1982, under the post-amendment law is only 22[.]7 percent. Since the attorney generally accepts the case before either parties’ [sic] medical evidence is fully developed, the attorney is often unable to evaluate the merits of the case at the time he accepts the client. This compounds the at- torney’s risk. It is impossible for attorneys to handle only a few cases pro bono because it is necesssary to handle a substantial number of cases in order to justify the time the attorney needs to invest to learn and keep current in this complex law. By prohibiting attorneys from taking a percentage of the back award, the statute was designed to protect coal miners and their widows from gouging attorneys. Unfor- tunately, the effect has been to make lawyers unavailable to the miners and widows whom the law was designed to protect. The only way the system will work is to drastically increase the fee awards. [Signature and acknowledgements omitted] | 33a IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA No. 18396 COMMITTEE ON LEGAL ETHICS OF THE WEST VIRGINIA STATE BAR v. GEORGE R. TRIPLETT MILLER, Justice, dissenting: We have traditionally stated that the scope of appellate review is confined to those issues decided at the trial level except where the lower court lacked jurisdiction to act in the first instance. This has coalesced into the language reflected in Syllabus Point 2 of Duquesne Light Co. v. State Tax Dep’t, __ W. Va. __, 327 S.E.2d 683 (1984): “ *This Court will not pass on a nonjurisdictional question which has not been decided by the trial court in the first in- stance.’ Syllabus Point 2, Sands v. Security Trust Co., 143 W.Va. 522, 102 S.E.2d 733 (1958).” Here the question of the constitutionality of the black lung fee statute could have been raised below, but it was not. Because the issue was not raised below, there is no factual record developed. The ex parte affidavits filed as attachments to the amicus brief of Jane Moran are, to my mind, woefully inadequate to predicate the factual conclu- sion reached by the majority. Furthermore, the majority’s reliance on Walters v. Na- tional Ass’n of Radiation Survivors, 473 U.S. 305, 87 L. Ed. 2d 220, 105 S. Ct. 3180 (1985), is completely mis- placed. I find, contrary to the majority’s statement, slip op. at 7, that Walters does not set “clear, bright line stand- ards.” What Walters did was to uphold the ten dollar fee Statutorily authorized for a lawyer or agent who represented a veteran who was seeking veteran’s benefits. 34a It did so chiefly because it began with this fundamental legal proposition: “Judging the constitutionality of an Act of Con- gress is properly considered ‘ “the gravest and most delicate duty that this Court is called upon to per- form.” ’ Rostker v. Goldberg, 453 U.S. 57, 64 [69 L. Ed. 2d 478, 486, 101 S. Ct. 2646, 2651] (quoting Blodgett v. Holden, 275 U.S. 142, 148, 276 U.S. 594, 72 L. Ed. 206, 48 S. Ct. 105 (1927) (Holmes, J.)), and we begin our analysis here with no less deference than we customarily must pay to the duly enacted and carefully considered decision of a coequal and representative branch of our Government.” 473 U.S. at 319, 87 L. Ed. 2d 232, 105 S. Ct. at 3188. The Supreme Court’s bottom line in Walters was that there was no factual showing that the fee system deprived veterans of due process under Mathews v. Eldridge, 424 U.S. 319, 47 L. Ed. 2d 18, 96 S. Ct. 893 (1976): “We accordingly conclude that under the Mathews v. Eldridge analysis great weight must be accorded to the Government interest at stake here. The flexibility of our approach in due process cases is intended in part to allow room for other forms of dispute resolu- tion; with respect to the individual interests at stake here, legislatures are to be allowed considerable leeway to formulate such processes without being forced to conform to a rigid constitutional ccde of procedural necessities. See Parham v. J.R., 422 U.S.., at 608, n.16, 61 L. Ed. 2d 101, 99 S. Ct. 2493. It would take an extraordinarily strong showing of probability of error under the present system—and the probability that the presence of attorneys would Sharply diminish that possibility—to warrant a holding that the fee Jimitation denies claimants due 35a process of law. We have no hesitation in deciding that no such showing was made out on the record before the District Court.” 473 U.S. at 326, 87 L. Ed. 2d at 236, 105 S. Ct. at 3192.! In this case, I simply do not believe that such an “ex- tradorinarily strong showing” has been made based on the generalized ex parte affidavits filed with this Court.? Here the main complaint by the several affiants is not so much the amount of the fee received, but the delay in receiving fees because of the backlog of black lung cases. I know of no court which has seized on this fact to void a fee system. Finally, there appears to me to be a lamentable lack of due process extended to the Department of Labor, which now finds its attorney’s fee mechanism declared un- ' Mathews v. Eldridge, 424 U.S. at 355, 47 L. Ed. 2d at 33, 96S. Ct. at 903, formulated this set of factors to determine the appropriate due process requirements: “[F]irst, the private interest that will be affected by the official ac- tion; second, the risk of an erroneous deprivation of such interest through the procedures used, and the probable value, if any, or additional or substitute procedural safeguards; and finally, the Government’s interest, including the function involved and the fiscal and administrative burdens that the additional or substitute procedural requirement would entail.” 2 In Walters, the Supreme Court was confronted with similar generalized assertions about the unfairness of the administrative pro- cedures in the Veteran’s Administration and made this telling com- ment: “Anecdotal evidence such as this may well be sufficient to sup- port a finding by a judge or jury in litigation between private par- ties that a particular fact did or did not exist. But when we deal with a massive benefits program provided by Congress in which 800,000 claims per year are decided by 58 regional offices, and 36,000 claims are appealed to the BVA, it is simply not the sort of evidence that will permit a conclusion that the entire system is operated contrary to its governing regulations.” 473 U.S. at 324 n.1i, 87 L. Ed. 2d at 235 n.11, 105 S. Cv 3191 n.11. 36a constitutional without ever having the opportunity to be neard before this Court announced its decision. i am authorized to state that Justice McHugh joins me in this dissent. | ; : : | 37a . APPENDIX B IN THE SUPREME COURT OF APPEALS OF WEST VIRGINIA No. 18396 COMMITTEE ON LEGAL ETHICS OF THE WEST VIRGINIA STATE BAR V. GEORGE R. TRIPLETT [Filed Dec. 20, 1988] NEELY, Justice: On a former day, to-wit the 14th day of December 1988, came the United States Department of Labor by its Solicitor of Labor, George R. Salem, Esq., and pursuant to leave heretofore granted, intervened to petition the court to grant a rehearing in this matter. Intervenor, the United States Department of Labor, also petitioned to supplement the record by the inciusion of the following: Affidavit of James L. De Marce, Associate Director, Divi- sion of Coal Mine Workers’ Compensation; Affidavit of Jane G. Denney; Affidavit of Nahum Litt; Department of Labor Letters CM-1000a and CM-1000b; and the awards and/or decisions in the cases of Charles Ice, Raymond Corley, Thelma Beam, Jacob B. Godwin, Peter Guire, Anna J. Poling, Euna Ball, Harry Hedrick, William F. Scott, and Inobelle Stevenson. All of the aforesaid Me 38a material is hereby ordered filed and made a part of the vecord in this case for all purposes. The court has carefully considered the supplemental material filed by the Department of Labor in support of its petition for rehearing, and has also carefully considered the factual representations and legal arguments set forth in intervenor’s brief in support of its petition for rehearing. The court concludes that the arguments advanced by the Department of Labor were maturely considered upon the initial submission of this case and are adequately ad- dressed in the court’s original opinion. intervenor seeks to overcome the court’s conclusion that lawyers are paid inadequately and too slowly under the current Department of Labor fee limitation system through the following representation: “Nor is it reasonable to conclude from the record that respondent would have experienced inordinate delays in having his fee pet.tions approved. In the one in- stance where he submitted a fee petition after obtain- ing a Trust Fund award at the deputy commissioner level, he received payment, at the requested rate and for more hours than he documented (but less than he requested), approximately eight months after his ap- plication. . . In the one instance where he applied to an ALJ for a fee award in a responsible operator case, he received an award, despite the operator’s objec- tions, within 11 months of the date of his application, and within 7 months of the ALJ’s receipt of it.” Intervenor’s Brief at p. 7. We find that an eight month and eleven month delay in fee payments simply support the findings of fact and conclusions of law set forth in the court’s Original opinion. Intervenor , defends the constitutionality of the fee sy’ tem as apphied by arguing that a different system would 39a be more expensive both in terms of the cost of lawyers’ fees and in terms of the added burden on the system of af- fording claimants a fair opportunity to be heard. In this regard intervenor asserts: “Another legitimate government interest is to ensure that responsible operators and the Trust Fund will not be overcharged. The Court recognized (slip op. 23) but gave very little weight to this interest. This interest is substantial because of operators’ constitutional rights (Levins, 724 F.2d at 9) and because the Trust ‘Fund, which is financed by the coal industry (26 U.S.C. (& Supp. IV) 4121(a), 9501), is currently almost $3 billion in debt to the United States Treasury. See Affidavit of James L. De Marce, supra. Higher attorney’s fees could increase this debt, as could the expense of more prolonged claims process- ing from attorney participation in cases (cf. Walters, 473 U.S. at 324-326), the latter by requiring the hiring of more personnel at the ALJ and Benefits Review Board levels to prevent a rebuilding of a case backlog. . . Such increased costs to the Fund; and thereby to the government in the form of increased debt, must be given serious consideration, as the Court admonished in Mathews, 424 U.S. at 348, even though they are not controlling. At some point, the costs to government and the public (including the resulting need to cut limited~ resources elsewhere) outweigh the benefit to the individual of the addi- tional safeguard.” Intervenor’s brief at pp. 16, 17. We infer that the Solicitor is arguing that the current fee limitation system, which discourages adequate representation, is justified on the grounds that if claimants had access to lawyers, claimants would prevail more often and raise the costs of the black \ f 40a lung program. We do not find that Congress’s purpose in authorizing limitations on fees was to reduce the number of eligible claimants who would prevail and receive benefits. Intervenor makes explicit reference to statistics com- piled specially for its rehearing petition in this case. The Department of Labor’s own specially compiled statistics (the Solicitor’s best shot) conclusively demonstrate that at the administrative law judge level, claimants represented by counsel have a likelihood of prevailing that is 2.5 times greater than claimants appearing pro se. In this regard the Sol.citor says: “Statistics compiled by the Department in a sample of recent cases resulting in awards or denials of benefits show that claimants are represented at the ALJ level in 92% of the cases, and prevail 29% of the time when represented. While the statistics also show that the small minority of pro se claimants have an 11.6% success rate, this difference certainly is not so signifi- cant as to establish that lawyers are indispensable in the BLBA claims process — particularly in light of the 92% representation rate.” Intervenor’s brief at p. 23. We find that the Solicitor has simply reinforced with more elaborate statistics the con- clusion that we reached in the original opinion— namely, that a claimant’s chance of prevailing when he is represented by counsel is substantially higher than when he appears pro Se. When claimants represented by counsel prevail 2.5 times as frequently [as] pro se claimants, we cannot agree with the Solicitor that the difference is not constitutionally sig- nificant for due process purposes. The Solicitor argues that: “Assuming, without conceding, that applicants have a property interest under the due process clause, their ia Ae ee ’ : : / : . : 4la interest is only the intangible interest in receiving fair consideration of their applications. They risk losing only a chance at benefits rather than the benefits themselves.” . Intervenor’s brief at p. 19. However, we stand by our original conclusions: We believe that “receiving fair con- sideration” is exactly the type of abstract entitlement that due process principles are designed to protect and en- chance. Finally, we have carefully considered the following argument of the Solicitor: “Moreover, as in Walters, 473 U.S. at 326, there is also a risk that increased attorney representation may exacerbate the adversarial nature of the black lung adjudicatory system, resulting in an [sic] increased administrative costs to the government and delay to deserving claimants.” Intervenor’s brief at p. 23. Because responsible operators may be as adversarial as they wish in the defense of claims, and may spend as much money as they choose on lawyers’ fees, we have a hard time understanding how claimant representation by lawyers is liable t [Text truncated at 120,000 characters. The full text is on the page linked above.] --- Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385012_0495%3A02. Public record. Not legal advice.