Mаrilyn FINKELSTEIN, Appellee, v. Otis R. BOWEN, M.D., Secretary of Health and Human Services, Appellant.
No. 88-5318
United States Court of Appeals, Third Circuit
March 3, 1989
Rehearing and Rehearing In Banc Denied May 24, 1989
869 F.2d 215
Argued Sept. 8, 1988. As Amended May 19, 1989.
John E. Biggiani (argued), Gelman & Gelman, Elmwood Park, N.J., for appellee.
Before BECKER, HUTCHINSON and SCIRICA, Circuit Judges.
OPINION OF THE COURT
HUTCHINSON, Circuit Judge.
The Secretary of Health and Human Services (Secretary) appeals an order of the United States District Court for the District of New Jersey. The district court had remanded this action for widow‘s disability benefits under the Social Security Act to the Secretary for consideration of the applicant‘s residual funсtional capacity. That order is not final for purposes of appellate review. We will therefore dismiss this appeal for lack of jurisdiction.
I.
On November 25, 1983, Mrs. Marilyn Finkelstein applied for disabled widow‘s benefits pursuant to
Pursuant to
On the merits, the Secretary argues that, in the case of widow‘s disability benefits, the statute and applicable regulations require him to look only to whether an applicant‘s impairment meets or equals an impairment listed in the regulations.2 The inquiry, he contends, does not extend, as in the case of a wage earner‘s disability, to examination of residual functional capacity.3 Instead, the Secretary argues, a wid
II.
At the threshold, we are faced with the question of appellate jurisdiction. Both parties initially asserted5 that we have jurisdiction under
Case law does provide examples of a narrow exception to the normal rule of non-appealability. Application of this exception is limited to cases in which an important legal issue is finally resolved and review of that issue would be foreclosed “as a practical matter” if an immediate appeal were unavailable. See, e.g., AJA Assocs. v. Army Corps of Eng‘rs, 817 F.2d 1070, 1073 (3d Cir.1987). Whether applying the normal rule or the exception, our inquiry focuses on “the particular order brought to this court.” Bachowski v. Usery, 545 F.2d 363, 372 (3d Cir.1976); see also United Steelworkers, 648 F.2d at 909 (“To assess these contentions, we must consider the nature of the district court‘s order.“). After examining the circumstances of the cases applying the normal rule of non-appealability and those holding that appellate jurisdiction over particular remand orders is available, we have concluded that the exception to the normal rule does not apply. Therefore, we lack appellate jurisdiction.
A.
We turn first to cases in which we applied the normal rule and hеld district court remand orders interlocutory rather than final. In Marshall v. Celebrezze, 351 F.2d 467 (3d Cir.1965) (per curiam), a Social Security disability case, the Secretary asked the district court to remand so he could take additional evidence. The district court granted the motion and the applicant appealed. We dismissed the appeal as interlocutory. See also Mayersky v. Celebrezze, 353 F.2d 89 (3d Cir.1965) (district court remand to obtain additional evidence in Social Security disability case not finаl).
Our decision in Bachowski is particularly relevant. Alleging violations of the Labor-Management Reporting and Disclosure Act and other irregularities, Bachowski sought to overturn the results of a union officer election. The Secretary of Labor refused to file suit to set aside the election, but gave no reasons. Bachowski filed an action against the Secretary, in district court, seeking an order compelling him to file suit. The district court dismissed the case for lack оf subject matter jurisdiction. On appeal, we held that the district court did have subject matter jurisdiction and that the scope of judicial review extended to the factual basis for the Secretary‘s decision
On appeal, we held this remand order was interlocutory. Bachowski, 545 F.2d at 372. Ultimately, the complaint sought an order directing the Secretary to file suit. The district court remanded only for further proceedings. We distinguished “the ultimate substantive issue presented by [the] appeals” from “the final question posed by Mr. Bachowski‘s complaint.” Id. at 372 n. 58. “It is the answer to the latter, not the former inquiry that constitutes a final judgment under the traditional test of finality.” Id. We also said that the issue of the proper method for counting votes might not escape later review. “By way of illustration, if the Secretary, after remand, would continue in his refusal to bring suit, and the district court ordered him to do so, the viability of the mode of review employed by [the court] would be before us on review.” Id.
B.
This case does not present circumstances analogous to the cases in which we held there was appellate jurisdiction. United Steelworkers is an example of such a case. We expressly based our holding on the peculiar circumstances of the case. There, the district court‘s order set aside the decision of a public law board, directed that on remand one member of the board be removed, and further directed the board to remand the case to the railroad for a de novo investigative hearing into the termination of one of its employees. United Steelworkers, 648 F.2d at 909. In analyzing the order to decide if it was “final” and therefore appealable for purposes of
Horizons Int‘l, Inc. v. Baldrige, 811 F.2d 154 (3d Cir.1987), is another example illustrating the exception to the normal rule of non-appealability. It involved the issuance of a certificate of review6 by the Secretary of Commerce for a proposed joint venture in the export sale of caustic soda and chlorine. Horizons challenged the issuance of the certificate and moved to limit discovery to the administrative record. The government moved for summary judgment. The district court remаnded the case to the Secretary and the Attorney General to consider five specific questions “which raise genuine issues of material fact concerning whether the grant of a certificate of review . . . was arbitrary, capricious, and an abuse of discretion.” Id. at 158. The five questions necessarily involved material outside of the administrative record. We held this order was final on two grounds. As in United Steelworkers, it acted both as a final disposition of the issues оn appeal and an effective preclusion of future review. We reasoned that a remand would require further proceedings based on evidence outside of the agency record, thereby mooting the agency‘s contention that the present record was adequate to support its action. Id. at 160. We distinguished this order from an order postponing final disposition where the plaintiff did not yet have a vested interest in obtaining the relief he
In AJA Associates, the Army Corps of Engineers (Corps) had denied AJA‘s application for a dredge-and-fill permit in connection with property it owned in Florida. AJA filed suit to set aside the denial and the Corps moved for summary judgment. The district court held that AJA was entitled to appear at an “‘informal oral hearing before a proper agency officer‘” to respond to the Corps’ reasons for denying the permit. AJA Associates, 817 F.2d at 1072 (quoting district court order). We said this order was final bеcause the district court‘s decision “opens up for all applicants the argument, raised after permit denial, that due process requires a hearing in their particular cases.” Id. at 1073. If the Corps conducted a hearing and either denied or granted a permit, the right-to-hearing issue would have been moot on appeal. Id. “[W]hen a district court finally resolves an important legal issue in reviewing an administrative agency action and denial of appellate review before remand to the agency would foreclose appellate review as a practical matter, the remand order is immediately appealable.” Id.
Likewise, in United States v. Spears, 859 F.2d 284 (3d Cir.1988), we held that a district court order directing a federal agency to comply with a Pennsylvania statute requiring notice before foreclosure proceedings was final. As in AJA Associates, the issue would have become moot and escaped review whether or not, on remand, the agency complied and gave the notice. Spears, 859 F.2d at 287.
III.
The Secretary argues that he will be unable to raise the issue of whether a widow‘s residual functional capacity is relevant to her claim for widow‘s disability benefits later if we do not exercise appellate jurisdiction over this particular remand order. We rejected the same argument by the Secretary of Labor in Bachowski and by Conrail in Brotherhood of Maintenance of Way Employees v. Consolidated Rail Corp., 864 F.2d 283 (3d Cir.1988). As in Bachowski, “it is not inexorably so” that consideration of this issue will escape review.
Bachowski is similar in its procedural posture to this case. If the Secretary, after consideration of Mrs. Finkelstein‘s residual functional capacity on remand, persists in refusing benefits and the district court orders that they be granted, the issue of whether residual functional capacity is relevant would be subject to our review. The рossibility that it would be unreviewable if the Secretary awards benefits is no different than the possibility in Bachowski that the district court‘s order directing certain vote counting procedures would be unreviewable if the Secretary decided to file suit to set aside the election after utilizing those procedures. Review may become unavailable, but it is not necessarily unavailable, as in AJA Associates.
Recently we held that a district court order remanding a railroad emplоyees’ discipline case to the National Railroad Adjustment Board “to ‘hear evidence as to whether [the employees] were sufficiently responsible for the accidents in question to warrant their dismissal‘” was interlocutory. Brotherhood of Maintenance of Way Employees, id. at 285 (quoting district court order). Although Brotherhood is distinguishable on the ground that the Adjustment Board, there the agency, was not a party, we nevertheless relied on the general principle “that district court orders remanding cases to administrative agencies are not final and appealable.” Id. at 285-86. We did so despite expressing concern over the district court‘s apparent interference with the arbitration board‘s power. Id. at 289. We distinguished United Steelworkers because there the order “had the practical effect of dismissing the present litigation and review of the legal questions raised by this appeal will be foreclosed if not permitted now.” Id. at 286, (quoting United Steelworkers, 648 F.2d at 909). In discussing Bachowski, Judge Sloviter went on to say:
The Secretary and the union appealed the district court‘s remand ordеr to this court arguing, as Conrail argues here, that if this court did not accept jurisdiction the Secretary “may very well [be] deprive[d] . . . of any opportunity to test the correctness of the scope of review employed by [the district court].” Id. at 372. We rejected this argument on the ground that the mode of review used by the district court would be reviewable if the district court later ordered the Secretary to file suit, an issue that remained undecided.
Id. Despite the fact that the agency was not a party, Brotherhood points uр how strongly the finality principle of avoiding piecemeal review pulls in favor of permit
Here, too, the ultimate question of whether the district court correctly ordered the Secretary to consider Mrs. Finkelstein‘s residual functional capacity would become reviewable if the district court orders the Secretary to grant benefits because she is so lacking in residual functional capacity that she cannot engage in any gainful activity. Although the Secretary may be denied review if he orders benefits to be paid upon consideration of Mrs. Finkelstein‘s residual functional capacity, that possibility is of no more significance than the possible unavailability of review was to Conrail in Brotherhood of Maintenance of Way Employees. Of course, if benefits are denied, Mrs. Finkelstein may obtain review.
The principle of finality serves important institutional functions. In sеrving them, issues which seem burning to the litigants in the course of an individual dispute often disappear, become subsumed in the final decision, and escape review in a particular case. When they involve questions of general significance they are likely to recur in future cases in a posture which does present them for appellate review. Such is this case. It deals with an issue likely to recur in future cases and arises in an administrative proсedure strongly analogous to common law adjudication of individual disputes.
The particular district order here at issue is interlocutory, not final. The district court remanded Mrs. Finkelstein‘s case to the Secretary “for further proceedings.” It ordered the Secretary to consider her residual functional capacity before deciding the question of eligibility. This remand concerned the factors for consideration in the adjudicatory process and not, as in AJA Associates, only the form that process must take.
Here, as in Bachowski, the district court remanded for further consideration according to its guidelines. In Bachowski, the guidelines related to the method of vote counting; here, they relate to consideration of residual functional capacity. Unlike the appellant in Horizons Int‘l, Mrs. Finkelstein has no vested right in anything; the court did not take away something which she had already been given, but postponed final disposition in her case until the Secretary had considered an additional factor. Unlike AJA Associates, the district court did not order a hearing when the issue was whether the statute or the regulations required a hearing; instead, it ordered consideration of an additional factor before final administrative adjudication of the benefit issue.
The institutional concerns precluding appellate review of non-final orders prevail and deprive this Court of appellate jurisdiction over the district court‘s order remanding this case to the agency for consideration of residual functional capacity. The district court‘s order remanding Mrs. Finkelstein‘s case to the Secretary for consideration of her residual functional capacity in determining her eligibility for widow‘s disability benefits is interlocutory, not final. Accordingly, we will dismiss this appeal for lack of appellate jurisdiction.
STATEMENT SUR DENIAL OF REHEARING IN BANC
BECKER, Circuit Judge.
I joined in the panel opinion, because I felt bound by our decision in Bachowski v. Usery, 545 F.2d 363 (3d Cir.1976), even though that opinion seems inconsistent at least with the spirit of our later jurisprudence. See United States v. Spears, 859 F.2d 284 (3d Cir.1988); AJA Associates v. Army Corps of Engineers, 817 F.2d 1070 (3d Cir.1987); Horizons International, Inc. v. Baldrige, 811 F.2d 154 (3d Cir.1987). I would hear this case in banc and hold that we have appellate jurisdiction, following the rule adopted by the D.C. Circuit in the case of Occidental Petroleum Corp. v. Securities and Exchange Commission, 873 F.2d 325, 328-32 (D.C.Cir.1989) (D. Ginsburg, J.).
In that case, Judge Ginsburg, speaking for the court, expressed the view that Congress did not intend that the final order rule place an agency in a position of dependence upon the self-interest of others in order to get review of a legal decision that dictates the standards and procedures to be applied by the agency in making its decisions. Here, as in Occidental, the Secretary is between the proverbial rock and a hard place. If the Secretary, bound by the district court‘s opinion, grants benefits on remand to Mrs. Finkelstein, he cannot appeal. If the Secretary does not grant benefits on remand, whether or not the legal issue will be reviewed depends on whether Mrs. Finkelstein decides to press an appeal.
I believe that the D.C. Circuit rulе is a sensible application of our existing jurisprudence, which provides a narrow exception to the normal rule of non-appealability in cases in which an important legal issue is finally resolved and review of that issue would be foreclosed “as a practical matter” if an immediate appeal were unavailable. See AJA, 817 F.2d at 1073. Unfortunately, I read Bachowski as foreclosing our applying that rule to this fact pattern, hence my vote for reheаring.
Judge SLOVITER and Judge STAPLETON agree with this statement.