HOWARD L. TADLOCK, JR. v. DENIS MCDONOUGH, SECRETARY OF VETERANS AFFAIRS
2020-1762
United States Court of Appeals for the Federal Circuit
July 15, 2021
Appeal from the United States Court of Appeals for Veterans Claims in No. 18-1160, Judge Joseph L. Toth.
CARL RICHARD HENNIES, Quinn Emanuel Urquhart & Sullivan, LLP, Houston, TX, argued for claimant-appellant. Also represented by WILLIAM ADAMS, MATTHEW A. TRAUPMAN, New York, NY.
RETA EMMA BEZAK, Commercial Litigation Branch, Civil Division, United States Department of Justice, Washington, DC, argued for respondent-appellee. Also represented by JEFFREY B. CLARK, TARA K. HOGAN, ROBERT EDWARD KIRSCHMAN, JR.; BRIAN D. GRIFFIN, DEREK SCADDEN, Office of General Counsel, United States Department of Veterans Affairs, Washington, DC.
Before NEWMAN, LINN, and CHEN, Circuit Judges.
This case presents the question of whether and to what extent the United States Court of Appeals for Veterans Claims (“Veterans Court“) may make findings of fact in the course of considering whether an error of the Board of Veterans Appeals (“Board“) was prejudicial. Because the Veterans Court‘s jurisdiction to consider prejudicial error does not give it the right to make de novo findings of fact or otherwise resolve matters that are open to debate, we vacate the Veterans Court‘s determination that Howard L. Tadlock, Jr. (“Tadlock“) is not entitled to presumptive service connection and remand for further proceedings consistent with this opinion.
BACKGROUND
Tadlock served in the Army from 1982 until 2003, including service in the Persian Gulf. In 2010, he suffered a pulmonary embolism (“PE“) that resulted in a heart attack. Tadlock sought presumptive service connection for the PE and the heart attack under
(2) . . . [A] chronic disability resulting from any of the following:
(A) An undiagnosed illness. (B) A medically unexplained chronic multisymptom illness (such as a chronic fatigue syndrome, fibromyalgia, and irritable bowel syndrome) that is defined by a cluster of signs or symptoms.
(C) Any diagnosed illness that the Secretary determines in regulations prescribed under subsection (d) warrants a presumption of service-connection.
Id. at
After several rounds of examinations, appeals, and remands, Tadlock underwent a final medical examination conducted in July 2017 by a Veterans Affairs (“VA“) physician (“examiner“). The examiner diagnosed Tadlock with a pulmonary embolism, noting that “Pulmonary Embolism (PE) is diagnosed and well documented by generally well accepted diagnostic procedure, that being pulmonary CT angiogram.” In re Tadlock, No. 13-15 547, at *9 (Bd. of Vet. App. 2019) (“VA Op.“) (quoting VA examiner‘s opinion). The examiner explained that because Tadlock‘s PE “is diagnosed, it is not an undiagnosed illness.” Id. The examiner also explained that Tadlock‘s PE was not “medically unexplained.” Id. at 11. The examiner thus concluded that “[i]t is less likely as not that pulmonary embolism is related to his active service, to include exposure to environmental hazards in [] Southwest Asia during the Gulf War.” J.A. 214.
The Board explicitly adopted the 2017 examiner‘s opinion and largely based its conclusion denying service connection on that opinion. Id. at 13. The Board ultimately held:
[T]he pulmonary embolism has been competently and credibly associated with a known etiology and diagnosis, pulmonary embolism, and therefore service connection based on the law and regulations pertaining to undiagnosed illness incurred due to Persian Gulf service is not warranted.
Id. (citing
With the benefit of pro bono counsel, Tadlock appealed to the Veterans Court, arguing that the definition of a “qualifying chronic disability” in
The Veterans Court, in a single-judge memorandum decision by Judge Toth, agreed with Tadlock: “Since a MUCMI, by definition, must be a diagnosed illness, denying
The Veterans Court went on, however, to find that the error was not prejudicial. The Veterans Court noted that both
that “[t]he acute PE that [Tadlock] suffered nearly 10 years ago is not characterized by overlapping signs and symptoms and unique features such as pain, fatigue, and disproportional disability when compared with physical findings.” Id. at 4. It therefore held that “any error in the Board decision regarding whether his diagnosed illness could count as a MUCMI is harmless.” Id. On that basis, the Veteran‘s Court affirmed.
The Veterans Court granted Tadlock‘s subsequent motion for a panel decision. A split panel adopted the memorandum decision as the decision of the court. Tadlock v. Wilkie, 2020 WL 738550, at *1–2 (Vet. App. Feb. 14, 2020). In dissent, Judge Pietsch noted that “the Court, under a prejudicial error analysis, applied a provision that the Board did not apply and made factual findings that the Board did not make,” characterizing this case as “the latest in a recent string of aggressive prejudicial error analyses” by the Veterans Court. Id. at *2. Judge Pietsch opined that the Veterans Court‘s decision was based “on a record not developed to answer” whether Tadlock‘s disability was a MUCMI, and “made medical findings despite its lack of medical competency.” Id.
Tadlock timely appeals.
DISCUSSION
I
As a preliminary matter, the government argues that we do not have jurisdiction to review the Veterans Court‘s decision in this case because Tadlock‘s arguments on appeal require consideration of whether the Board‘s error was prejudicial, a factual determination outside this court‘s jurisdiction to review. See Newhouse v. Nicholson, 497 F.3d 1298, 1302 (Fed. Cir. 2007) (”Newhouse II“) (holding that this court‘s jurisdiction does not allow considering appellant‘s “contentions regarding actual prejudice“); Pitts v. Shinseki, 700 F.3d 1279, 1286–87 (Fed. Cir. 2012)
(applying Newhouse II in a similar circumstance); Conway v. Principi, 353 F.3d 1369, 1375 (Fed. Cir. 2004) (“[T]he ultimate conclusion of the effect of the rule of prejudicial error on this case is beyond our jurisdiction“). The government proffers a rule that “when the Veterans Court has undertaken a review for prejudicial error and determined that an error is harmless, this court lacks jurisdiction to disturb that determination.” Appellee‘s Br. at 13.
The government‘s proposed rule is overly broad and is expressly rejected. This court may review legal questions, including the validity of any statute or regulation or any interpretation thereof.
Tadlock‘s challenge here is not to the factual determination of the Veterans Court that his illness was not a MUCMI, but instead to the Veterans Court‘s authority to make that fact-determination in the first instance in its consideration of prejudicial error. Although we cannot review and do not here decide whether the Veterans Court was correct to hold that Tadlock‘s illness was not a MUCMI, we can review the question of law whether the Veterans Court exceeded its jurisdiction in making that
determination in the first instance. Indeed, we made this distinction explicitly in Newhouse II. 497 F.3d at 1301–02 (first considering whether the Veterans Court exceeded its jurisdiction in violation of Sec. & Exch. Comm‘n v. Chenery Corp., 318 U.S. 80 (1943), then holding that we could not consider the veterans challenge to the Veterans Court‘s factual determination of no actual prejudice).
We conclude that we have jurisdiction over this case under
II
A
On the merits, Tadlock argues that the Veterans Court improperly engaged in de novo fact finding in making its determination of no prejudicial error. He argues that his case is analogous to Hensley in which we held that the Veterans Court had exceeded its jurisdiction in finding no prejudicial error on an insufficiently developed factual record. He also argues that the Veterans Court violated Chenery by substituting a different rationale in support of its finding of no prejudicial error, citing Mayfield v. Nicholson, 444 F.3d 1328 (Fed. Cir. 2006). The government argues in opposition that the Veterans Court was not only correct in reviewing the Board‘s decision for prejudicial error, but was required to do so, and that this analysis allows the Veterans Court to go outside the facts found by the Board, relying on Mlechick v. Mansfield, 503 F.3d 1340 (Fed. Cir. 2007) and Newhouse II.
B
“The Court of Appeals for Veterans Claims shall have exclusive jurisdiction to review decisions of the Board of Veterans’ Appeals.”
provided in section 7261 of this title.” Id. at
While the Veterans Court is also empowered to “hold unlawful and set aside or reverse [a finding of material fact adverse to the claimant] if the finding is clearly erroneous,”
C
The Veterans Court, in deciding all cases before it, is also statutorily charged with taking “due account of the
rule of prejudicial error.”
In Newhouse v. Nicholson, 21 Vet. App. 65 at *5 (2006) (unpublished) (”Newhouse I“), the Veterans Court determined that the VA failed to provide Newhouse proper notice of the evidence he needed to submit to substantiate his claims. Newhouse alleged that with the required notice, he would have resubmitted a July 1985 examination or would have sought additional audiology examination to substantiate his claim, and that the proper course for the Veterans Court was to vacate the Board‘s denial of benefits and remand. Id. at *4. The Veterans Court disagreed because it determined that the notice deficiency was
This court, without considering whether Newhouse was actually prejudiced, endorsed the Veterans Court‘s prejudicial error analysis, noting that the “[t]he statute does not limit the Veterans Court‘s inquiry to the facts as found by the Board, but rather requires the Veterans court to ‘review the record of the proceedings before the Secretary and the Board’ in determining whether the VA error is prejudicial.” Newhouse II, 497 F.3d at 1302 (quoting
The government relies on Newhouse II and Mlechick for the broad proposition that prejudicial error review allows—indeed, requires—the Veterans Court to consider whether the Board‘s error was prejudicial based on the record, unfettered by the particular fact-findings made by the VA or the Board. The government‘s argument is overstated and its reliance on these cases is misplaced. The Veterans Court‘s decision in Newhouse I was based on a determination that the record unquestionably revealed no prejudice from the VA‘s notice error: the 1985 letter Newhouse alleged he would have submitted with proper notice was already in the record, and he had already requested the audiological examinations he alleged he would have sought with proper notice. 21 Vet. App. 65, at *5 (“[T]he appellant could not have been prejudiced by such notice.“). The Veterans Court thus did not need to make a factual determination that was open to debate in the first instance. Moreover, there is no indication in Newhouse II that the
veteran even argued that the Veterans Court‘s affirmance was based on new fact-findings. 497 F.3d at 1301–02. Newhouse II thus does not support the government‘s position.
Mlechick also does not support the government‘s position. At best, both Newhouse II and Mlechick expressly and correctly recognized that the prejudicial error analysis must be performed in every case and must be done so on the record made before the agency. Newhouse II, 497 F.3d at 1301 (“[T]he Veterans Court was required to examine whether any errors by VA were prejudicial and [] it must do so based on the administrative record” (emphasis added)); Mlechick, 503 F.3d at 1345 (“The statutory obligation [to consider prejudicial error] permits the Veterans Court to go outside of the facts as found by the Board to determine whether an error was prejudicial by reviewing ‘the record of the proceedings before the Secretary and the Board‘” (quoting Newhouse II, 497 F.3d at 1302) (emphasis added)). While “the record of the proceedings before the Secretary and the Board” is broader than “the facts as found by the Board,” nothing in either case, however, requires or even
In Shinseki v. Sanders, 556 U.S. 396, 406 (2009), the Supreme Court explained that the Veterans Court prejudicial error mandate “requires the Veterans Court to apply the same kind of ‘harmless error’ rule that courts ordinarily apply in civil cases” and when reviewing agency action under the Administrative Procedure Act (“APA“). In reviewing agency action under the APA, “[t]he task of the reviewing court is to apply the appropriate APA standard of review,
reviewing court.” Camp v. Pitts, 411 U.S. 138, 142 (1973). The appellate courts “should not simply . . . [make] factual findings on [their] own.” Icicle Seafoods, 475 U.S. at 714.
Tadlock relies on Mayfield in arguing that the Veterans Court exceeded its jurisdiction by affirming on a ground other than the VA‘s stated ground. In that case, the Veterans Court concluded that Mayfield did not receive adequate notice under the Veterans Claims Assistance Act (“VCAA“) via a series of statements and decisions that occurred after an initial decision by the VA but were statutorily required to be provided before such a decision. 444 F.3d at 1334. Rather than remand, the Veterans Court held that a 2001 letter provided the necessary notice and therefore affirmed the Board‘s denial of service connection. Id. On appeal, we held that “the Veterans Court would have been in a position to decide whether the insufficiency in the notice was prejudicial” only if the Board “had considered the March 15, 2001, notice and found it sufficient, and if the Veterans Court had ruled that the March 15, 2001, notice was insufficient.” Mayfield, 444 F.3d at 1337. Because the Board had not considered the March 15, 2001 letter, the Veterans Court could not affirm on prejudicial error grounds based on that letter. Id.
D
Notwithstanding the foregoing, the Veterans Court may affirm on a ground not considered by the Board and the VA if it is clear that the factual basis for such conclusion is not open to debate and the Board on remand could not have reached any other determination on that issue. See Mayfield, 444 F.3d at 1336 (“[T]his case is not one in which we can conclude that there was no violation of the Chenery doctrine on the ground that it is clear that . . . the agency would have reached the same ultimate result under the court‘s legal theory” (alteration in original) (quoting Grabis v. Office of Pers. Mgmt., 424 F.3d 1265, 1270 (Fed. Cir. 2015))); Fleshman v. West, 138 F.3d 1429, 1433 (Fed.
Cir. 1998) (affirming Veterans Court‘s affirmance on a different legal rubric because it seems clear to us that the agency would have reached the same conclusion if it had addressed the legal issue on which the Court of Veterans Appeals rested its judgment“). This is consistent with appellate review in APA cases. See, e.g., NLRB v. Wyman-Gordon Co., 394 U.S. 759, 766 n. 6 (1969) (affirming agency action
E
It is well-settled that the veterans’ benefits system is intended to be pro-veteran. Henderson v. Shinseki, 562 U.S. 428, 440–41 (2011). That does not mean, however, that the processing and resolution of a claim filed by a veteran should be open-ended and never-ending. To the contrary, it is in the interests of both the veteran and the government that all claims be brought to a full, just, prompt and efficient conclusion. To obviate unnecessary remands and unnecessarily protracted proceedings, Congress, while otherwise broadly supporting the rights of veterans, statutorily mandated consideration of prejudicial error in the determination of appeals before the Veterans Court. But obviating unnecessarily protracted proceedings
does not suggest that Congress intended to override the statutory constraint imposed on the Veterans Court not to engage in de novo fact finding. When questions of fact are open to debate, veterans are entitled to present whatever evidence and arguments they have to the agency charged with administering veterans’ benefits and possessed with the expertise to render informed judgments and to have that evidence and those arguments considered by that agency in the first instance. “The rule of harmless error cannot be invoked to allow the Court of Appeals for Veterans Claims to decide a matter that is assigned by statute to the [VA] for the initial determination,” nor can the rule be invoked to support an affirmance that “may [] have required it to make improper de novo findings of fact.” Winters v. Gober, 219 F.3d 1375, 1380 (Fed. Cir. 2000); Deloach, 704 F.3d at 1381 (“[W]hen the Board misinterprets the law and fails to make the relevant initial factual findings, ‘the proper course for the Court of Appeals for Veterans Claims is to remand the case to the Board for further development and application of the correct law‘” (quoting Byron v. Shinseki, 670 F.3d 1202, 1205 (Fed. Cir. 2012))).
For the above reasons, we hold that
III
A
Turning to the present case, the determination of whether an illness is “defined by a cluster of signs or symptoms,”
Neither the Board nor the VA here considered whether Tadlock‘s condition was characterized by overlapping symptoms or signs. Rather, the Board‘s decision denied service connection for Tadlock‘s PE because his PE had a diagnosis and etiology, and thus did not qualify as an MUCMI under
Because “a MUCMI, by definition, must be a diagnosed illness,” the Veterans Court held that the VA‘s denial of presumptive service connection was clearly erroneous. Tadlock, 2019 WL 2707830, at *2. It affirmed only by determining, in the first instance, that “Tadlock has not
identified, any overlapping symptoms or signs related to his PE or any other features of his condition that would suggest it as a MUCMI.” Veterans Court Op. at 4. The Veterans Court did not cite any fact-finding by the Board or by the VA examiner and the record does not show such a determination by the VA examiner or the Board.1 Indeed, the government readily admits that “the [B]oard had not addressed whether Mr. Tadlock‘s PE met the additional [cluster of signs or symptoms] criteria to be considered a MUCMI.” Appellee‘s Br. at 21; Id. at 22 (“Here, the board did not address the specific issue of whether Mr. Tadlock‘s PE was characterized by overlapping signs and symptoms and had features such as fatigue, pain, disability out of proportion to physical findings, and inconsistent demonstration of laboratory abnormalities.“). The determination that Tadlock‘s symptoms did not constitute a MUCMI because they did not feature such overlapping signs or symptoms was thus the Veterans Court‘s alone.
B
We agree with Tadlock that this case is substantially similar to Hensley.
connection between heart disease and toxic gas exposure. Id.
The Board held that Hensley‘s claim for secondary service connection was not well-grounded because the absence of heart disease in the regulation precluded presumptive service connection for heart disease through a secondary disability route. Id. The Board therefore did not consider the reports Hensley submitted. Id. On appeal, the Veterans Court held that the Board‘s construction was erroneous because the absence of heart disease in the regulation did not preclude service connection for heart disease as a secondary disability. Id. at 1258. Nevertheless, the Veterans Court affirmed the Board‘s holding that Hensley claim was not well-grounded after analyzing the reports in the first instance to conclude that Hensley failed to establish a nexus between his heart disease and his exposure to mustard gas during service. Id. See also Hensley v. West, 16 Vet. App. 284 at *3–5 (1998) (Table).
On appeal, this court held that the Veterans Court had exceeded its jurisdiction. We explained that “[a]s a consequence of [the Board‘s erroneous determination with respect to the interpretation of
This court applied Hensley in Elkins. There, a veteran sought service connection for a headache condition due to a car accident in service. Id. at 1371. The VA denied his claim and the Board affirmed, holding that Elkins had failed to submit a well-grounded claim because he did not provide competent medical evidence of a current headache condition. Id. at 1372. The Veterans Court held that the Board had clearly erred in this determination and that Elkins had indeed provided sufficient medical evidence of a current headache condition. Id. at 1377. Nevertheless, the Veterans Court affirmed, finding a lack of evidence of nexus between the headache condition and Elkins‘s service based on its own initial review. Id. Relying on Hensley, we held that this was error because the Veterans Court‘s affirmance “involve[d] finding facts in the first instance.” Id.
Like the Veterans Court‘s determinations of well-groundedness in Hensley and Elkins, the Veterans Court here sought to consider in the first instance whether Tadlock‘s symptoms constituted a MUCMI, an inquiry delegated to the VA. As noted
The government attempts to distinguish Hensley and Elkins as based not on prejudicial error but clear error. What the government overlooks is that in each of Hensley and Elkins, the Veterans Court not only held that the Board‘s denial of benefits was based on clear error, but went on to affirm for lack of prejudice on other grounds requiring additional fact finding. Indeed, in Hensley, we stated: “The Court of Appeals for Veterans Claims then held that the [Board‘s] error was therefore not prejudicial
to Mr. Hensley,” 212 F.3d at 1258, a conclusion that we vacated as improperly dependent on fact-finding in the first instance. There is no basis to distinguish this case from Hensley and Elkins.
C
Finally, the government argues that the Veterans Court‘s determination that Tadlock‘s condition was not a MUCMI was not based on its finding of facts in the first instance but was based “entirely on factual determinations made by the board” and that the “factual record here was sufficient.” Appellee‘s Br. at 30 (citing Veterans Court Op., 2019 WL 2707830 at *3, Fleshman, 138 F.3d 1429, and Mayfield, 444 F.3d at 1335); id. at 25. The government asserts that the Board “specifically noted that the PE was diagnosed and that it was not medically unexplained, and so it could not serve as the basis for a grant of service connection.” Id. at 25. This argument is inexplicable. As the government immediately thereafter recognizes, the Veterans Court found that determination to be clearly erroneous. Id. The basis for prejudicial error cannot be the identical determination the Veterans Court found to be erroneous. Contrary to the government‘s argument, we agree with Judge Pietsch‘s observation that the Veterans Court “applied a provision that the Board did not apply and made factual findings that the Board did not make.” Tadlock, 2020 WL 738550, at *2 (Pietsch, J., dissenting). Moreover, as noted above, the government admits that the Board did not rule on whether Tadlock‘s condition was characterized by overlapping symptoms or signs.
CONCLUSION
For the reasons discussed above, the Veterans Court exceeded its authority in making a fact finding in the first instance that Tadlock‘s illness did not qualify as a MUCMI because of a lack of overlapping symptoms. We thus vacate
the decision of the Veterans Court and remand for further proceedings consistent with this opinion.2
VACATED AND REMANDED
Each party shall bear its own costs.