Cushman v. Shinseki

United States Court of Appeals for the Federal Circuit
2008-7129

PHILIP E. CUSHMAN,

Claimant-Appellant,

v.

ERIC K. SHINSEKI, Secretary of Veterans Affairs,

Respondent-Appellee.

Kevin A. Calia, Morrison & Foerster LLP, of San Francisco, California, argued for
claimant-appellant.

Martin F. Hockey, Jr., Assistant Director, Commercial Litigation Branch, Civil
Division, United States Department of Justice, of Washington, DC, argued for
respondent-appellee. With him on the brief were Jeanne E. Davidson, Director, and
Allison Kidd-Miller, Trial Attorney. Of counsel on the brief were David J. Barrans,
Deputy Assistant General Counsel, and Tracey P. Warren, Attorney, Office of the
General Counsel, United States Department of Veterans Affairs, of Washington, DC.

Appealed from: United States Court of Appeals for Veterans Claims

Judge Mary J. Schoelen
 United States Court of Appeals for the Federal Circuit

2008-7129

PHILIP E. CUSHMAN,

Claimant-Appellant,

v.

ERIC K. SHINSEKI, Secretary of Veterans Affairs,

Respondent-Appellee.

Appeal from the United States Court of Appeals for Veterans Claims in 05-3207, Judge
Mary J. Schoelen.

__________________________

DECIDED: August 12, 2009
__________________________

Before SCHALL, PLAGER, and PROST, Circuit Judges.

PROST, Circuit Judge.

This case involves an alleged violation of a veteran’s right to due process under

the Fifth Amendment to the United States Constitution, where the medical record on

which his service-connected disability claim was evaluated contained an improperly

altered document. In contending that a veteran has a protected property interest

requiring fair adjudication of his claim for disability benefits, the Appellant raises a

constitutional issue of first impression for this court. For the reasons discussed below,

we find that a veteran alleging a service-connected disability has a due process right to

fair adjudication of his claim for benefits. We further find that Mr. Cushman’s due
process rights were violated in this case by the consideration of tainted medical

evidence. We vacate the contrary decision of the Court of Appeals for Veterans Claims

(“Veterans Court”) and remand the case with instructions for a new hearing.

I. BACKGROUND

Philip Cushman served in a United States Marine Corps combat infantry battalion

in Vietnam during the Vietnam War. While he was fortifying a bunker in Vietnam, a

heavy sandbag fell on Mr. Cushman’s back and damaged his spine. He was honorably

discharged in January of 1970. Mr. Cushman underwent four spinal surgeries to treat

his injury and has received continuous pain medication.

In October of 1974, Mr. Cushman filed a disability claim with the Department of

Veterans Affairs (“DVA”) at the Portland Regional Office. Following three years of

interaction with medical examiners and Adjudication Officers at the Regional Office, the

Board of Veterans’ Appeals (“Board”) found that Mr. Cushman’s injury was service

connected, and classified his symptoms as “pronounced” (a grade above “severe”) with

“persistent symptoms” and “little intermittent relief.” See 38 C.F.R. § 4.71a (1982)

(diagnostic code 5293). Mr. Cushman received a 60% disability rating, which is the

maximum scheduled rating for a back injury.

Mr. Cushman secured a job as a manager at a flooring store. The job required

some bending and lifting work, as well as supervision and paperwork. During his time

on the job, Mr. Cushman’s back condition worsened. Mr. Cushman avoided sitting and

standing at work whenever possible. During his last few months at work he would

typically lie flat on his back behind the store counter to fill out paperwork and whenever

2008-7129 2
it was not necessary to move around. In November of 1976, Mr. Cushman was asked

to resign his position at the warehouse due to his inability to perform his job duties.

In October of 1976, Mr. Cushman went to the Portland DVA Outpatient Clinic to

have his condition reassessed. Records from that visit diagnosed him as having a

postoperative ruptured intervertebral disc, with radiculopathy and degenerative joint

disease affecting his lumbar and lumbosacaral spine. In November of 1976, when Mr.

Cushman resigned from his job, he returned to the DVA Outpatient Clinic for another

assessment. This assessment, dated November 15, 1976, was the last entry in Mr.

Cushman’s medical record before his files were sent to the Portland Regional Office.

The last comment in the record stated, “Is worse + must stop present type of work.”

Mr. Cushman filed a request with the DVA for a total disability based upon

individual unemployability (“TDIU”) rating in May of 1977. With his request, Mr.

Cushman included a letter from his former employer explaining that Mr. Cushman could

not continue to work at the flooring store because he was always lying on his back to do

paperwork. The following July, the Regional Office denied Mr. Cushman’s claim without

obtaining his medical records. Mr. Cushman appealed to the Board. In February of

1978, the Board vacated the denial and remanded the case to the Regional Office with

instructions to consider medical evidence in evaluating Mr. Cushman’s claims.

The Regional Office obtained Mr. Cushman’s medical records from the DVA

Outpatient Clinic, and gave him a new hearing. In November of 1978, the Regional

Office again denied Mr. Cushman’s claim. The Regional Office did not discuss any

medical evidence in its decision, although Mr. Cushman’s medical file was included in

the record. Mr. Cushman appealed again to the Board.

2008-7129 3
 In April of 1980, the Board affirmed the decision of the Regional Office. Although

the Board did not cite any particular evidence on which it relied in making its decision,

the Board concluded that “the evidence fails to show the presence of symptomology

which would preclude sedentary employment.” The medical record before the Regional

Office and Board, however, differed from the medical record on file at the DVA

Outpatient Clinic. Namely, one of the doctor’s entries had been altered to change the

language “Is worse + must stop present type of work” to instead read, “Is worse + must

stop present type of work, or at least [] bend [] stoop lift.” (emphasis added, brackets

indicate illegible or stray marks). The altered record also contained the additional entry,

“says he is applying for reevaluation of back condition,” which does not appear in the

official record on file with the Outpatient Clinic. The alterations appeared in the last, i.e.,

most recent, doctor’s notes documenting Mr. Cushman’s condition.

Mr. Cushman sought reconsideration of the Board’s 1980 decision. In 1982, the

Board affirmed its prior decision based on the same evidentiary record.

During this time, Mr. Cushman also filed a claim for disability benefits from the

Social Security Administration (“SSA”). The SSA requested Mr. Cushman’s medical

records from the DVA to consider in determining Mr. Cushman’s eligibility for SSA

disability benefits. The DVA sent to the SSA the version of Mr. Cushman’s medical

record that was on file with the Regional Office, i.e., the altered version. The SSA

denied Mr. Cushman’s claim, repeating in its decision language that appears only in the

altered version of Mr. Cushman’s record.

Mr. Cushman requested reevaluation and a TDIU rating in 1994. He returned to

the Outpatient Clinic for another assessment of his back condition. Based on the

2008-7129 4
medical record of that visit, the DVA found him to be incapable of substantially gainful

employment, and granted his TDIU rating. Mr. Cushman has received TDIU benefits

since August of 1994.

Mr. Cushman first discovered that there were two versions of his medical record

in October of 1997. Mr. Cushman went to the DVA hospital to review his records in

preparation for another hearing before the Board, this time seeking an earlier effective

date for his TDIU rating. He also reviewed the record from his prior proceedings before

the Regional Office and Board. He noticed that the medical record attached to his claim

adjudication did not match the medical record on file at the DVA hospital. The file at the

DVA hospital contained only the original, unaltered document.

Mr. Cushman wrote to the DVA about the discrepancy between the two versions

of his medical record. The DVA conducted an investigation that confirmed that Mr.

Cushman’s medical record had been altered. In response to Mr. Cushman’s inquiry, the

Chief Executive Officer of the Portland Regional Office sent Mr. Cushman a letter in

which he acknowledged the discrepancy between the two medical records, and

explained that the DVA was unable to locate the original (wet ink) record among its files.

He also apologized that the DVA was unable to “arrive at a reasonable explanation” for

the nonconforming records. He confirmed that the official record is the one without the

additional entries. The DVA instructed the Portland Regional Office to destroy all copies

of the altered document in Mr. Cushman’s file. The Office of Inspector General opened

an investigation for fraud, but closed it three weeks later as unsubstantiated, two days

after receiving the DVA’s response to the complaint.

2008-7129 5
 Upon learning of the nonconforming records, Mr. Cushman challenged the

Regional Office’s 1977 decision, and the Board’s 1980 and 1982 decisions as

containing clear and unmistakable error (“CUE”). He argued that those decisions were

based on medical records that were improperly altered to understate his disability. In

February of 1999, the Board denied his claim on grounds that the 1977 decision was

subsumed by the 1980 and 1982 decisions by the Board. The Board did not address

Mr. Cushman’s argument that the 1980 and 1982 decisions imported the same CUE.

Mr. Cushman timely appealed to the Veterans Court. In November of 2001 the

Veterans Court affirmed the Board with respect to the 1977 decision, and found that it

did not have jurisdiction to review the 1980 and 1982 decisions because Mr. Cushman

did not properly raise a CUE claim for those decisions.

Mr. Cushman timely appealed to this court, and argued again that the 1977,

1980, and 1982 decisions contained CUE. He also argued that the process used to

adjudicate his claims violated his due process rights. During oral argument, this court

questioned Mr. Cushman’s counsel about the consideration given to the merits of his

CUE claims below. This court then asked the government’s counsel whether the merits

of Mr. Cushman’s claim had ever been decided, and how he could receive such a

hearing. The government’s counsel explained that the CUE claims were not decided,

and if this court affirmed the Veterans Court’s decision, Mr. Cushman would be free to

raise those claims before the Board. In April of 2002, this court summarily affirmed the

Veterans Court.

In October of 2003, Mr. Cushman moved the Board to reverse its 1980 and 1982

decisions. Mr. Cushman argued that consideration of the improperly altered medical

2008-7129 6
record constituted CUE. He also argued that the Board incorrectly interpreted the

governing regulations and failed to construe the term “substantially gainful

employment.” In August of 2005, the Board ruled that the 1980 and 1982 decisions did

not contain CUE because the decisions gave no indication that the Board relied

specifically on the altered document. It was therefore not possible to prove that

consideration of the altered document was outcome determinative, as required by the

CUE standard. The Board also rejected Mr. Cushman’s arguments regarding the

Board’s previous interpretation of the governing regulations and statutory construction.

Meanwhile, Mr. Cushman filed a civil action in the United States District Court for

the District of Oregon regarding the denial of his social security disability claim. The

district court remanded Mr. Cushman’s case for further evaluation by the Social Security

Office. Mr. Cushman appealed to the United States Court of Appeals for the Ninth

Circuit. In April of 2006, the Ninth Circuit reversed the district court and remanded his

disability claim for immediate payment of benefits. The Ninth Circuit also found that Mr.

Cushman’s medical record had been “fraudulently altered” and remanded the claim to

determine whether he was entitled to retroactive disability benefits from an earlier date.

Cushman v. Soc. Sec. Admin., 175 Fed. Appx. 861, 862 (9th Cir. 2006). In August of

2007, the Social Security Administration Appeals Council (“Council”) reconsidered Mr.

Cushman’s claim and found that he had been continuously disabled since February of

1976. The Council extended his benefits accordingly.

With respect to his veteran’s claim, Mr. Cushman appealed the Board’s August

2005 decision to the Veterans Court, challenging the Board’s statutory interpretation

and making CUE and due process arguments related to the consideration of his

2008-7129 7
nonconforming medical records. In February of 2008, a single-judge panel of the

Veterans Court affirmed the Board. Mr. Cushman moved for reconsideration by a full

panel. The motion was denied in May of 2008 and judgment was entered in June. In

July, Mr. Cushman timely appealed the case to this court.

II. THE GOVERNMENT’S POST-ARGUMENT
MOTION FOR VOLUNTARY REMAND

As a threshold matter, we consider the government’s motion for voluntary

remand, submitted after oral argument before this court. During oral argument, the

panel questioned the government attorney as to why the DVA was reluctant to give Mr.

Cushman a new hearing without the presence of the altered document. The

government attorney indicated a willingness to reassess its position, and asked for two

weeks in which to consider whether the parties could resolve the matter.

Following oral argument, the panel suspended proceedings in the case for thirty

days in order to allow the parties to reach a settlement. At the conclusion of the thirty-

day period, the government informed the panel that no settlement was reached. The

panel resumed proceedings. The following week the government submitted a motion

for voluntary remand to allow the Board to reconsider its 1980 and 1982 decisions and

in the alternative to send the case to “mandatory mediation.” Mr. Cushman opposed the

motion, arguing that voluntary remand would not provide the requested relief and would

preclude Mr. Cushman from petitioning for attorneys fees as a prevailing party. He also

argued that the government previously opposed mediation and should not now be

allowed to change its position.

The government’s motion for voluntary remand was accompanied by a proposed

order stating only that the case was remanded “to enable the Board to reconsider its

2008-7129 8
1980 and 1982 decisions.” We find that mere voluntary reconsideration does not

guarantee Mr. Cushman adequate relief. The terms of the proposed order give no

assurance that Mr. Cushman would receive a new hearing, that the determination would

be reviewed de novo, or that the proceedings would be conducted without the presence

of the altered document. Although the government represents in its supporting

memorandum that it will pursue such process, we have no authority to enforce those

representations. Moreover, the government’s representations do not bind the Board.

We therefore must deny the government’s motion for voluntary remand, even though

the government contends that granting the motion would provide Mr. Cushman the

alternate relief that he seeks.

We also deny the government’s alternative request for “mandatory mediation.”

Mr. Cushman did not oppose mediation initially. The government did. We decline to

compel Mr. Cushman to mediation at this juncture, after the briefs have been filed, oral

arguments have been heard, and the thirty-day suspension to allow settlement has

lapsed. We now turn to the merits of Mr. Cushman’s appeal.

III. DUE PROCESS

This court reviews legal determinations of the Veterans Court de novo. Prenzler

v. Derwinski, 928 F.2d 392, 393 (Fed. Cir. 1991). If the decision of the Veterans Court

is not in accordance with law, this court has authority to modify, reverse, or remand the

case as appropriate. 38 U.S.C. § 7292(e)(1).

This court has jurisdiction to interpret constitutional provisions “to the extent

presented and necessary to a decision,” id. § 7292(c), and authority to “decide all

relevant questions of law, including interpreting constitutional and statutory provisions.”

2008-7129 9
Id. § 7292(d)(1). This court has jurisdiction and authority to consider a free-standing

constitutional issue independently from the CUE framework typically applicable to

appellate review of veterans’ claims. See In re Bailey, 182 F.3d 860, 869-70 (Fed. Cir.

1999).

Mr. Cushman asserts that he was denied a full and fair hearing on the factual

issues of his claim due to the presence of the altered medical record. Mr. Cushman

therefore raises a genuine issue of procedural due process under the Fifth Amendment

to the Constitution. Cf. Pierre v. West, 211 F.3d 1364, 1367 (Fed. Cir. 2000). We find

that this court has jurisdiction to resolve the due process issue in deciding his claim.

In order to allege that the denial of his claim involved a violation of his due

process rights, Mr. Cushman must first prove that as a veteran alleging a service-

connected disability, he has a constitutional right to a fundamentally fair adjudication of

his claim. The right to due process of applicants for veterans’ benefits is an issue of first

impression for this court.

The Due Process Clause of the Fifth Amendment guarantees that an individual

will not be deprived of life, liberty, or property without due process of law. U.S. Const.

amend. V. Due process of law has been interpreted to include notice and a fair

opportunity to be heard. See Mullane v. Cent. Hanover Tr. Co., 339 U.S. 306, 313

(1950). To raise a due process question, the claimant must demonstrate a property

interest entitled to such protections. Richard v. West, 161 F.3d 719, 723 (Fed. Cir.

1998).

It is well established that disability benefits are a protected property interest and

may not be discontinued without due process of law. See Atkins v. Parker, 472 U.S.

2008-7129 10
115, 128 (1985); Mathews v. Eldridge, 424 U.S. 319, 332 (1976). The Supreme Court

has not, however, resolved the specific question of whether applicants for benefits, who

have not yet been adjudicated as entitled to them, possess a property interest in those

benefits. See Lyng v. Payne, 476 U.S. 926, 942 (1986); Walters v. Nat’l Ass’n of

Radiation Survivors, 473 U.S. 305, 312, 320 n.8 (1985); Peer v. Griffith, 445 U.S. 970

(1980) (Rehnquist, J., dissenting).

The Supreme Court has, however, offered guidance relevant to our resolution of

this question by explaining, “‘[t]o have a property interest in a benefit, a person clearly

must have more than an abstract need or desire’ and ‘more than a unilateral

expectation of it. He must, instead, have a legitimate claim of entitlement to it.’” Town

of Castle Rock, Colo. v. Gonzales, 545 U.S. 748, 756 (2005) (quoting Bd. of Regents of

State Colls. v. Roth, 408 U.S. 564, 577 (1972)). The Court has also clarified that “a

benefit is not a protected entitlement if government officials may grant or deny it in their

discretion.” Id. at 756 (citing Ky. Dep’t of Corr. v. Thompson, 490 U.S. 454, 462-63

(1989)).

In Richardson v. Perales, the Supreme Court strongly implied that certain due

process protections are applicable to the adjudicative administrative proceedings

associated with social security disability claim hearings. 402 U.S. 389, 401-02 (1971).

The Court has also noted “that the benefits at stake in DVA proceedings, which are not

granted on the basis of need, are more akin to the Social Security benefits involved in

2008-7129 11
Eldridge than they are to the welfare payments” at issue in Goldberg. 1 Nat’l Ass’n of

Radiation Survivors, 473 U.S. at 333. We believe the protected property interests

implicated in social security proceedings provide a helpful analogy in assessing the

property interests of veteran applicants for service-connected disability benefits.

Like the statutorily created right of an eligible recipient to social security benefits,

entitlement to veteran’s benefits arises from a source that is independent from the DVA

proceedings themselves. 38 U.S.C. § 1110 (2000) (providing for wartime disability

compensation); id. § 1121 (providing for wartime death compensation for designated

heirs and dependents); id. § 1131 (providing for peacetime disability compensation); id.

§ 1141 (providing for peacetime death compensation for designated heirs and

dependents). These statutes provide an absolute right of benefits to qualified

individuals.

Although the due process question is one of first impression for this court, the

Ninth Circuit has previously held that “both applicants for and recipients of [service-

connected death and disability] benefits possess a constitutionally protected property

interest in those benefits.” Nat’l Ass’n of Radiation Survivors v. Derwinski, 994 F.2d

583, 588 n.7 (9th Cir. 1992). Additionally, seven of our sister circuits have addressed

similar questions concerning statutorily mandated benefits. “Every regional circuit to

1
The Court has also commented that recipients in Goldberg, who had not
yet shown that they were within the statutory terms of eligibility, “had a right to a hearing
at which they might attempt to do so.” Roth, 408 U.S. at 577 (commenting on Goldberg
v. Kelly, 397 U.S. 254 (1970)). The right to a hearing necessarily implies the right to a
fair hearing. See, e.g., Mullane, 339 U.S. at 315 (“[P]rocess which is a mere gesture is
not due process.”). As such, Roth suggests that at least some due process protections
attach to procedures for determining eligibility for benefits even outside of the social
security context.

2008-7129 12
address the question . . . has concluded that applicants for benefits, no less than

benefits recipients, may possess a property interest in the receipt of public welfare

entitlements.” Kapps v. Wing, 404 F.3d 105, 115 (2d Cir. 2005); see, e.g., Kelly v. R.R.

Ret. Bd., 625 F.2d 486, 489-90 (3d Cir. 1980) (holding an applicant for a disabled child’s

annuity was denied due process); Mallette v. Arlington Cnty. Employees’ Supplemental

Ret. Sys. II, 91 F.3d 630, 634-35 (4th Cir. 1996) (concluding that a statute’s mandatory

language gives an applicant a property interest in retirement benefits which triggers

procedural due process protection); Hamby v. Neel, 368 F.3d 549, 559-60 (6th Cir.

2004) (affirming that eligible applicants for Medicaid benefits have a legitimate claim of

entitlement which invokes procedural due process); Wright v. Califano, 587 F.2d 345,

354 (7th Cir. 1978) (“[Benefit] denials do not necessarily deserve less due process than

terminations.”); Daniels v. Woodbury Cnty., Iowa, 742 F.2d 1128, 1132 (8th Cir. 1984)

(refusing to distinguish between applicants and recipients when analyzing the due

process requirements for determining eligibility for Iowa welfare benefits); Gonzalez v.

Sullivan, 914 F.2d 1197, 1203 (9th Cir. 1990) (“An applicant for social security benefits

has a property interest in those benefits.”); Ressler v. Pierce, 692 F.2d 1212, 1214 (9th

Cir. 1982) (affirming that applicants for federal rent subsidies are entitled to due process

protection); Griffeth v. Detrich, 603 F.2d 118, 119 (9th Cir. 1979) (holding that applicants

for welfare benefits had a property interest or legitimate claim of entitlement and were

entitled to due process to protect that interest); see also Cook v. Principi, 318 F.3d

1334, 1352 (Fed. Cir. 2002) (en banc) (Gajarsa, J. dissenting) (concluding that the

statutory mandate of veteran disability benefits entitles applicants to procedural due

process).

2008-7129 13
 In response, the government cites three cases in which circuit courts found that

an individual did not obtain a protected property interest merely by applying for benefits.

See Banks v. Block, 700 F.2d 92 (6th Cir. 1983) (declining to find a property interest in

food stamp benefits after expiration of the eligibility period); Holman v. Block, 823 F.2d

56 (4th Cir. 1987) (same); DeJournett v. Block, 799 F.2d 430 (8th Cir. 1986) (finding

that an applicant had no protected property interest in a discretionary loan). The cited

cases, however, are distinguishable from the present case. Banks and Holman deal

with the rights of an applicant who is no longer eligible for benefits. DeJournett deals

with the denial of a discretionary benefit. As cited above, the respective circuits of these

three cases have found that due process attaches in the context of nondiscretionary

benefits.

Veteran’s disability benefits are nondiscretionary, statutorily mandated benefits.

A veteran is entitled to disability benefits upon a showing that he meets the eligibility

requirements set forth in the governing statutes and regulations. We conclude that such

entitlement to benefits is a property interest protected by the Due Process Clause of the

Fifth Amendment to the United States Constitution.

IV. MR. CUSHMAN’S DUE PROCESS CLAIM

We now turn to the issue of whether Mr. Cushman acquired a due process right

in his claim for benefits that was violated by the process he received from the Portland

Regional Office, Board, and Veterans Court. 2

2
We note that Mr. Cushman challenged the 1977 denial of his claim
promptly upon discovering the nonconforming versions of his medical record. It is not
disputed that his free-standing due process claim was timely raised.

2008-7129 14
 When Mr. Cushman was injured while serving in a United States combat infantry

battalion in Vietnam, he acquired a legitimate claim of entitlement to veteran’s disability

benefits under 38 U.S.C. § 1110 et seq. Applications for benefits cannot be denied

unless the DVA factually determines that the applicant does not suffer from a disability

originating from service. Id.

The government asserts that even if due process attaches to veteran’s benefits,

Mr. Cushman received adequate process, citing his multiple hearings before the

Regional Office and appeals before the Board, Veterans Court, and this court. The

sheer number of times that Mr. Cushman has appealed the denial of his claim, however,

is not relevant to the question of whether he has ever received a fair hearing. The initial

determination of Mr. Cushman’s TDIU claim was tainted by the presence of an

improperly altered document. That initial determination has been subject to nothing but

deferential review, on a record that still contained the altered document. The source of

the fundamental unfairness that tainted the initial evaluation of Mr. Cushman’s claim

was never removed from any prior proceedings. Therefore, none of the subsequent

appeals and rehearings that Mr. Cushman received satisfied his due process right to a

fair hearing on the merits of his disability claim.

The government argues that the question of what process is due does not turn

upon the allegations of an individual claimant. The government cites language from

National Association of Radiation Survivors, stating that “a process must be judged by

the generality of cases to which it applies, and therefore, process which is sufficient for

the large majority of a group of claims is by constitutional definition sufficient for them

all.” 473 U.S. at 330. The government reasoned in its brief, and elucidated in oral

2008-7129 15
argument, that because the veteran’s claims procedures provide due process

“generally,” there is no violation when due process is denied on the basis of an error in

an individual case. The government’s position is predicated on a misinterpretation of

National Association of Radiation Survivors.

The challenger in National Association of Radiation Survivors alleged that the

$10 fee limitation for attorneys representing veterans in disability cases denied him a

meaningful opportunity to obtain legal counsel. Id. at 307. The Court reasoned that the

statutorily imposed fee limitation did not violate due process because a majority of

veterans are able to effectively pursue their claims without counsel. Id. at 330.

Unlike the veteran in National Association of Radiation Survivors, Mr. Cushman

does not challenge an entire statutory scheme. He does not challenge the adequacy of

any procedures in place for filing a claim for veteran’s benefits. He does not challenge

the constitutionality of the CUE framework provided in 38 U.S.C. § 7111. 3 Mr.

Cushman instead argues that the government failed to fairly apply the existing

procedures in his case due to the introduction and consideration of improperly altered

medical records. 4 We agree.

3
Mr. Cushman does not challenge the constitutionality of CUE itself, but he
does assert that the burdens of proof applicable to CUE claims do not apply to his free-
standing due process claim. We agree that the burdens of proof typically applicable to
due process claims also apply to such claims raised in the context of veteran’s benefits.
4
Mr. Cushman also raises allegations concerning unpublished DVA policies
aimed at reducing TDIU ratings. Such allegations are entirely speculative and Mr.
Cushman can show no nexus between such policies and the denial of his claim. We
therefore confine our due process analysis to the presence of altered documents in Mr.
Cushman’s medical record.

2008-7129 16
 The procedural framework for adjudicating claims must be sufficient for the large

majority of a group of claims in order to be constitutionally adequate for all. See Nat’l

Ass’n of Radiation Survivors, 473 U.S. at 330. A fundamentally fair adjudication within

that framework, however, is constitutionally required in all cases, and not just in the

large majority. Cf. Romano v. Oklahoma, 512 U.S. 1, 12-13 (1994) (explaining that the

admission of improper evidence is a denial of due process where it infects the

proceedings with fundamental unfairness.) The government’s application of the

generality standard to Mr. Cushman’s claim is therefore misdirected.

The presentation of improperly altered material evidence has been found to

constitute a due process violation in analogous cases. See, e.g., Grillo v. Caughlin, 31

F.3d 53, 56-57 (2d Cir. 1994) (finding that the presentation of an altered urinalysis

record was a violation of due process in the criminal context); Stemler v. City of

Florence, 126 F.3d 856, 872 (6th Cir. 1997) (applying Grillo in the civil context).

Fraudulent intent on the part of the presenter of the false evidence is not required to find

a due process violation. See Brady v. Maryland, 373 U.S. 83, 87 (1963) (finding that

the state’s inadvertent but prejudicial suppression of favorable evidence was a due

process violation). Alterations of evidence are material for due process purposes if

there is a “reasonable probability of a different result” absent those alterations. Cf.

Kyles v. Whitley, 514 U.S. 419, 434 (1995).

We find, in this case, that the presentation of the altered medical document was

indeed prejudicial. The Regional Office was instructed by the Board on remand to

consider medical evidence in determining Mr. Cushman’s employability. The altered

document was the only piece of medical evidence that addressed Mr. Cushman’s then

2008-7129 17
current employability. The substance of the alterations spoke directly to the type of

work that Mr. Cushman could perform in light of his progressing disability. Although, as

the government argues, the Regional Office and Board did not discuss which evidence

was determinative, any reasonable fact finder would have at least considered the

altered medical record under these circumstances. The content of the altered

document indicated that Mr. Cushman was more employable than did the content of the

unaltered document. We find that there is a reasonable probability that the result of Mr.

Cushman’s TDIU hearing would have been different in the presence of the unaltered

document instead of the altered document.

Accordingly, consideration of the altered document instead of the unaltered

document in adjudicating Mr. Cushman’s claim was a violation of his constitutional right

to a fair hearing. Mr. Cushman is entitled to a new hearing without the presence of the

altered document. We therefore vacate the decision of the Veterans Court and remand

the case with instructions to further remand to the Board for a de novo determination of

Mr. Cushman’s 1977 TDIU request.

V. MR. CUSHMAN’S CUE CLAIMS

In addition to raising a due process claim, Mr. Cushman raises CUE claims

relating to the statutory employability standard applied to his determination, as well as

the consideration of his altered medical record. 5 Mr. Cushman argues that his CUE

claims compel this court to reverse the decision of the Veterans Court and issue an

5
Mr. Cushman’s allegations concerning the unpublished DVA policies
discussed in note 4, above, are also raised in his CUE claims and we similarly reject
such allegations.

2008-7129 18
order directing the Veterans Court to grant Mr. Cushman a TDIU rating effective May 3,

1977.

Mr. Cushman’s CUE arguments challenging the consideration of his altered

medical record and the statutory construction and interpretation of the employability

standard applied to his TDIU claim fall within the scope of this court’s review under 38

U.S.C. §§ 5109 and 7292. CUE is a “very rare and specific kind of error.” 38 C.F.R.

§ 20.1403(a). To establish CUE, an appellant must prove (1) either the correct facts, as

they were known at the time, were not before the Board, or the statutory or regulatory

provisions in effect at the time of the decision were incorrectly applied, and (2) the

alleged error was outcome determinative. Id.

Mr. Cushman argues that consideration of the altered medical record constitutes

CUE because the correct facts, as they were known at the time, were not before the

Board. We agree with Mr. Cushman that the correct facts as known were not before the

Board. Mr. Cushman is unable to show, however, whether this error was outcome

determinative because the Board did not specify the evidence on which it relied in

denying Mr. Cushman’s claim. A remand to the Board for a more appropriate

explanation of its reasoning is nonetheless unnecessary in view of our resolution of Mr.

Cushman’s due process claim and the relief awarded in Part IV above.

With respect to Mr. Cushman’s employability standard argument, we find that the

Board’s 1980 and 1982 statutory construction and interpretation of the relevant standard

did not constitute CUE based on the altered medical record. Mr. Cushman alleges that

the 1980 and 1982 Board decisions applied the wrong employability standard in denying

his claim for TDIU. Mr. Cushman’s claim for TDIU under 38 C.F.R. § 4.16 requires him

2008-7129 19
to demonstrate that his injury precludes him from securing “substantially gainful

employment.” “Unemployability” under 38 C.F.R. § 4.18 requires an individual to

satisfactorily show preclusion from all further employment.

Although the Board uses TDIU language and mentions the “substantially gainful

employment” standard in its discussion, the sentence in which the Board states its

ultimate holding uses only the word “unemployable.” Mr. Cushman argues that this

language indicates that, notwithstanding the mention of the correct standard elsewhere

in the discussion, the ultimate decision of the Board was actually based on the wrong

standard.

The Board noted in its discussion that Mr. Cushman completed an electronics

course and was doing electronics repair work from home at the time of the decision.

The Board considered this evidence that “sedentary employment was not precluded.”

Mr. Cushman argues that his repair work consisted of odd jobs, earning him about $100

per month (less than 25% of the poverty level at the time), and can hardly be

considered “substantially gainful.” Mr. Cushman argues that neither the Board nor the

Veterans Court construed the term “substantially gainful employment,” which was a

legal error resulting in application of an incorrect statutory standard.

Although the Board uses the term “unemployable” in its decision, Mr. Cushman

has not shown that the Board actually employed the wrong standard. The majority of

the Board’s explanation for its decision uses language from the correct section of the

statute. It is only the final sentence that uses language from the wrong section. The

choice of wording appears to have been the result of a clerical error or the use of stock

language from prior decisions, rather than substantive error.

2008-7129 20
 We also find Mr. Cushman’s argument that the Board failed to construe the

phrase “substantially gainful employment” to be without consequence. The Board

found, in light of the altered medical document, that Mr. Cushman was not incapable of

substantially gainful employment because he had electronics training and his condition

did not preclude him from sedentary employment. Whether Mr. Cushman’s actual

electronics work was substantially gainful is irrelevant. The DVA may find that a veteran

is physically capable of substantially gainful employment even if he is not currently

engaged in such employment. Mr. Cushman has thus failed to show that the outcome

of his case would have been different if the Board construed the term as he proposes.

We therefore deny Mr. Cushman’s request for an order directing the grant of an earlier

TDIU effective date. Mr. Cushman is free to argue to the Board or Regional Office on

remand that his service-connected disability precluded electronics work that was

substantially gainful.

VI. CONCLUSION

Mr. Cushman demonstrated that his injury meets the service connection

requirement of 38 U.S.C. § 1110. Mr. Cushman has a constitutional right to have his

claim for veteran’s disability benefits decided according to fundamentally fair

procedures. We find that this right was violated due to the presence of an improperly

altered medical record in Mr. Cushman’s file. We vacate the June 6, 2008 decision of

the Veterans Court and remand the case with instructions to grant Mr. Cushman a new

hearing before the Board to determine de novo and without the presence of the

alterations in his medical record whether Mr. Cushman was unable to secure a

2008-7129 21
substantially gainful occupation between May 3, 1977 and August 31, 1994, because of

his service-connected disability.

COSTS

Costs are awarded to Appellant.

VACATED AND REMANDED

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