Ceres Gulf v. Cooper

UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT

_______________________

No. 91-2097
_____________________

CERES GULF and ESIS/INA,

Plaintiffs-Appellees,

versus

CLEASTER COOPER

Defendant,

DIRECTOR, OFFICE OF
WORKERS' COMPENSATION PROGRAMS (U.S.
Department of Labor),

Intervenor-Appellant.

____________________________________________

Appeal from the United States District Court
for the Southern District of Texas
______________________________________________

(March 27, 1992)

Before HIGGINBOTHAM and BARKSDALE, Circuit Judges, and McBRYDE,
District Judge.1

BARKSDALE, Circuit Judge:

Primarily at issue is subject matter jurisdiction vel non for

an original action in district court against a former employee to

recover advance payments made under the Longshore and Harbor

Workers' Compensation Act, 33 U.S.C. § 901 et seq. (LHWCA), when

additional LHWCA compensation is not owed the employee and the

relief sought is not permitted, either procedurally or

1
District Judge of the Northern District of Texas
sitting by designation.
substantively, by the Act. After being denied such recovery in

LHWCA administrative proceedings, but without seeking review in a

court of appeals as allowed by the Act, the employer and its

compensation insurer filed this separate suit. Several months

later, when a default judgment was being considered, the Director,

Office of Workers' Compensation Programs, fortuitously became aware

of this action and immediately sought to intervene, based on his

authority as administrator of the LHWCA. This notwithstanding, the

district court entered the judgment and later denied intervention.

The Director bases error, inter alia, on the denial and lack of

subject matter jurisdiction. We agree and REVERSE and REMAND with

instructions.

I.

Ceres Gulf is a stevedoring company subject to the LHWCA;

ESIS/INA, its worker's compensation insurer.2 Almost immediately

after Ceres Gulf employed Cooper, he claimed that he had been

injured in the course of that employment and sought compensation

and medical benefits under the LHWCA. Ceres Gulf did not promptly

controvert Cooper's LHWCA claim; instead, over a period of almost

18 months, it made advance payments to him totalling approximately

$36,000.3

2
Unless the context specifies otherwise, Ceres Gulf and
ESIS/INA will be referred to collectively as Ceres Gulf.
3
If a claim is timely controverted as prescribed by the
LHWCA, advance payments are not required. 33 U.S.C. § 914(a),
(d) and (e).

2
 Ceres Gulf did, however, contest the claim; and following a

hearing, an Administrative Law Judge (ALJ) denied it, finding that

a work injury had not occurred.4 Concomitantly, the ALJ denied

Ceres Gulf's request for reimbursement of the advance payments,

ruling that "33 U.S.C. § 914(j) which is the only known authority

for allowing reimbursement for overpayments applies only in cases

where it is contemplated that additional [LHWCA] compensation will

become due." Cooper and Ceres Gulf appealed to the Department of

Labor Benefits Review Board (BRB); and it affirmed, holding in

part:

The [LHWCA] ... provides for reimbursement of
advance compensation payments only if unpaid
installments of compensation remain owing. Since
the [ALJ] found that [Cooper] had failed to
establish a compensable injury and, therefore, was
not entitled to any further compensation, [Ceres
Gulf] cannot receive reimbursement.

The LHWCA provides for review of the BRB ruling in the courts

of appeals. Ceres Gulf did not utilize this next step in the

statutory scheme. Instead, within a month of the BRB's ruling, it

brought this separate action for reimbursement in district court,

asserting that the remedy sought was "essentially one to enforce

the provisions of an administrative order" and that jurisdiction

existed under the general federal question statute, 28 U.S.C. §

1331, and "the equitable powers of the Court".

Cooper did not answer the complaint. Accordingly, the

district court entered a default and "asked [Ceres Gulf] to answer

4
The ALJ found that "the main reason for [Cooper's]
hospitalization ... was his alcohol abuse not his alleged knee
injury."

3
the question of recoverability." Ceres Gulf v. Cooper, 756 F.

Supp. 303, 304 (S.D.Tex. 1990). In its "Memorandum On Recovery of

Excess Benefits", and based upon its analysis of the statutory

framework, the district court held that it had jurisdiction and

that Ceres Gulf was entitled to recover. In so holding, it cited

in support "a case involv[ing] similar facts and many of the same

issues", Stevedoring Services of America, Inc. v. Eggert, 23 Ben.

Rev. Bd. Serv. 25 (CRT) (W.D. Wash. Oct. 24, 1989). 756 F.Supp. at

306. (As discussed infra, that decision has been recently reversed

by the Ninth Circuit. 953 F.2d 552 (9th Cir. 1992)).

The district court's opinion and final judgment were signed

(but the latter not entered) on December 11. Pursuant to earlier

communication with the district court, the Director moved to

intervene of right on December 12, one day before entry of the

judgment; to set aside the default judgment; and to dismiss.

Subsequent to entry of the judgment on December 13, the district

court denied the motions.

II.

The Director timely appealed both the default judgment and the

order denying its motions.5 In addition to raising the

intervention issue, the Director asserts that the district court

5
"The denial of ... interven[tion] of right is
appealable...." Jones v. Caddo Parish Sch. Bd., 704 F.2d 206,
217-18 (5th Cir. 1983), aff'd on reh'g, 735 F.2d 923 (5th Cir.
1984) (en banc); see, e.g., Cajun Elec. Power Coop., Inc. v. Gulf
States Utils. Inc., 940 F.2d 117, 118-19 (5th Cir. 1991).

4
lacked subject matter jurisdiction.6 We opt to first address

intervention.7

A.

Intervention of right, unless conferred unconditionally by a

federal statute, Fed. R. Civ. P. 24(a)(1), is addressed in Rule

24(a)(2). Rule 24(a) provides in part:

Upon timely application anyone shall be permitted
to intervene in an action ... (2) when the
applicant claims an interest relating to the
property or transaction which is the subject of the
action and the applicant is so situated that the
disposition of the action may as a practical matter
impair or impede the applicant's ability to protect
that interest, unless the applicant's interest is
adequately represented by existing parties.

See also New Orleans Public Serv., Inc. v. United Gas Pipe Line

Co., 732 F.2d 452, 463-64 (5th Cir.) (en banc), cert. denied, 469

U.S. 1019 (1984). The district court denied intervention without

listing reasons. Intervention of right rulings are reviewed de

novo.8 In so doing, we are cognizant that "`the inquiry under

6
The Director also contends that, assuming jurisdiction,
the district court erred in holding that Ceres Gulf could
recover. Lack of jurisdiction renders this issue moot.
7
Even though subject matter jurisdiction, always a
threshold matter, is in issue, we elect to first address the
intervention issue, without deciding that one of the two issues
must be addressed first in cases such as this, where (1) subject
matter jurisdiction is not only a threshold issue, but is the
central issue, and (2) the rights and role of the intervenor are
inextricably tied to that issue. But cf. Gregory-Portland Indep.
Sch. Dist. v. Texas Educ. Agency, 576 F.2d 81, 83 n.1 (5th Cir.
1978), cert. denied, 440 U.S. 946 (1979); see id. at 83 (Godbold,
J., concurring).
8
Normally, we review the district court's findings on
timeliness under the abuse of discretion standard. Mothersill
D.I.S.C. Corp. v. Petroleos Mexicanos, S.A., 831 F.2d 59, 62 (5th
Cir. 1987). Here, however, we can only review de novo its

5
[Rule 24](a)(2) is a flexible one, which focuses on the particular

facts and circumstances surrounding each application'"; that

"`intervention of right must be measured by a practical rather than

technical yardstick.'" United States v. Texas E. Transmission

Corp., 923 F.2d 410, 413 (5th Cir. 1991) (citation omitted).

Timeliness is the first factor. Default was entered under

Fed. R. Civ. P. 55(a) in mid-October 1990. The Director was not

notified by Ceres Gulf of the pendency of this action; instead, he

learned of it on November 28, 1990, when he saw it referenced in a

reply brief in Eggert.9 He contacted Ceres Gulf's counsel the next

day to advise that he intended to intervene; by letter to the

district court and counsel, filed the following day (November 30),

he confirmed that intent, requested a stay, and enclosed a motion

for leave to appear; and he received the pleadings and other court

papers on December 3. By order signed on December 6 and entered on

December 10, counsel for the Director was granted leave to appear;

and on December 12, the motion to intervene was filed. The

district court's opinion and the judgment had been signed, however,

on December 11; the judgment was entered on December 13. Ceres

Gulf concedes that the Director was not dilatory in seeking to

ultimate determination, because, as noted, it did not provide
findings on the intervention factors.
9
The Director participated in the Eggert appeal as
amicus curiae, because he learned of the suit only after it had
been appealed to the Ninth Circuit and briefs had been filed.
Ceres Gulf urges that the Director can adequately represent his
interest through amicus participation. As discussed infra, we
reject this contention. Needless to say, had the Director not
sought to intervene, there would not have been an appeal in which
the Director could have participated, as amicus or otherwise.

6
intervene. Instead, it contests timeliness because the motion was

filed after the judgment was signed, asserting that the efforts to

set it aside are prejudicial to Ceres Gulf, because of the

additional expense and delay incurred in seeking to satisfy its

judgment. The prejudice to be considered in ruling on intervention

of right, however, is that created by the intervenor's delay in

seeking to intervene after it has learned of its interest in the

action, not prejudice to existing parties if intervention is

allowed. Stallworth v. Monsanto Co., 558 F.2d 257, 265 (5th Cir.

1977). We have allowed post-judgment intervention in other cases.

E.g., Thurman v. Federal Deposit Ins. Corp., 889 F.2d 1441, 1446

(5th Cir. 1989); Baker v. Wade, 769 F.2d 289, 292 (5th Cir. 1985)

(en banc), cert. denied, 478 U.S. 1022 (1986). See also

Stallworth, 558 F.2d at 266 (whether intervention motion filed

before or after entry of final judgment is "of limited

significance" as a measure of timeliness).

In Stallworth, this court established four timeliness factors,

558 F.2d at 264-66; their application supports finding the

Director's motion timely. First, he knew of his interest in the

case only a short time before he moved to intervene. Second,

because he moved just after learning this action was pending, there

was no prejudice to existing parties from delay in seeking to

intervene. Third, the prejudice to the Director if he is not

allowed to intervene to assert his jurisdictional arguments is

significant. And fourth, the existence of a substantial question

about the district court's jurisdiction -- a matter the Director is

7
uniquely qualified to address -- is a special factor that supports

finding timeliness.

Pursuant to Rule 24(a)(2), we next determine whether the

Director "claims an interest relating to the property or

transaction which is the subject of the action and ... is so

situated that the disposition of the action may as a practical

matter impair or impede [his] ability to protect that interest".

Ceres Gulf contends that this action is outside the administrative

process; that it "is not challenging the Director's jurisdiction or

authority to administer the LHWCA"; that the "property" in issue is

the compensation payments Cooper received; and that the Director

has no "interest" in claimants being allowed to retain such

"property" when obtained improperly.

We need not define Rule 24(a)(2) "property or transaction" so

narrowly. See New Orleans Public Serv., 732 F.2d at 463-64.10 The

Director's interest springs from his role in administering the

LHWCA. The Secretary of Labor has delegated to him all functions

with respect to its administration. 20 C.F.R. § 701.201,

701.202(a) (1991); Ingalls Shipbuilding Div., Litton Sys., Inc. v.

White, 681 F.2d 275, 286 (5th Cir. 1982). Under the LHWCA and its

regulations, the Director is vested with an important "watchdog"

role "to ensure the fair and adequate compensation of injured

employees." 681 F.2d at 287. Accordingly, the Director's interest

10
See also Nuesse v. Camp, 385 F.2d 694, 700 (D.C. Cir.
1967) ("in the intervention area the `interest' test is primarily
a practical guide to disposing of lawsuits by involving as many
apparently concerned persons as is compatible with efficiency and
due process").

8
is, among other things, consistent application of the LHWCA, a

statutory scheme he is charged with administering. For example, in

a 1977 report, the Senate Committee on Human Resources stated:

In establishing the Longshore Act procedures it was
the intent of this Committee to afford the
Secretary the right to advance his views in the
formal claims litigation context whether or not the
Secretary had a direct financial interest in the
outcome of the case. The Secretary's interest as
the officer charged with the responsibility of
carrying forth the interest of Congress with
respect to the Act should be deemed sufficient to
confer standing on the Secretary or such designee
of the Secretary who has the responsibility for
enforcement of the Act, to actively participate in
the adjudication of claims before the
Administrative Law Judge, Benefits Review Board,
and appropriate United States Courts.

S.Rep. No. 95-209, 95th Cong., 1st Sess. 22 (1977) (quoted in

Ingalls, 681 F.2d at 287).

Newport News Shipbuilding & Drydock Co. v. Peninsula

Shipbuilders' Association, 646 F.2d 117 (4th Cir. 1981), concerned

the denial of the National Labor Relations Board's motion to

intervene (the district court had instead allowed amicus status) in

an action by a shipbuilding company against a union, in which the

company sought a judicial construction of the collective bargaining

agreement. While the action was pending, the NLRB initiated an

administrative proceeding against the company and union and moved

to intervene in, and stay, the court action, pending the NLRB

proceeding.

The Fourth Circuit reversed the denial of intervention,

finding sufficient interest in the NLRB's "role as the primary

tribunal for the adjudication of unfair labor practices and from

9
its statutory responsibility for preventing and remedying those

practices." Id. at 120 (citations omitted). It relied on the

existence of common issues in the two proceedings and noted the

NLRB's "legitimate interest ... in being able in the district court

fairly to protect its jurisdictional claims". Id. at 121. And, as

in this case, "a substantial question of the district court's

jurisdiction" existed. Id.11 The Director seeks intervention for

substantially the same reasons, including to exercise the

administrative authority delegated to it under a statutory scheme

and to protect his jurisdiction.

As for the last Rule 24(a)(2) factor, it is obvious that the

Director's interest is not adequately represented by existing

parties. Cooper never appeared in the district court to represent

his interests, much less the Director's. And, Ceres Gulf's

interest in bringing this action is directly opposed to the

Director's concern for enforcing the statutory scheme.

We conclude that the district court erred in denying Rule

24(a)(2) intervention. The Director's interest that justifies

intervention is the protection of administrative jurisdiction over

LHWCA claims. In addition, denying intervention impairs, if not

prevents, his ability to provide his interpretation of the law he

11
Similar reasoning has been followed in other cases
where the NLRB was allowed to intervene under Rule 24 under
analogous circumstances. See Bevona v. Field Bridge Assocs., No.
90 Civ. 5191, 1991 WL 274467 (S.D.N.Y. Dec. 6, 1991);
Pennsylvania Truck Lines v. Teamsters, No. 88-6968, 134 L.R.R.M.
2223 (BNA) (E.D. Pa. May 14, 1990); International Bhd. of
Boilermakers v. Combustion Eng'g, Inc., 337 F. Supp. 1349 (D.
Conn. 1971); International Bhd. of Teamsters v. Ace Enters., 332
F. Supp. 36 (S.D. Cal. 1971).

10
is charged with administering and would be harmful in allowing a

precedent, reached without his input, on an important LHWCA related

issue. Moreover, his interest is impaired by the stare decisis

effect of the district court's judgment, which creates a new cause

of action outside agency jurisdiction. See Nuesse v. Camp, 385

F.2d 694, 702 (D.C. Cir. 1967).

B.

Subject matter jurisdiction is a question of law; our review

is plenary. E.g., Taylor-Callahan-Coleman Counties Dist. Adult

Probation Dept. v. Dole, 948 F.2d 953, 956 (5th Cir. 1991).

Needless to say, federal courts have limited jurisdiction. The

district court held that it had "jurisdiction because this is a

federal question, arising directly under a federal statutory

compensation plan. 28 U.S.C. § 1331; [LHWCA,] 33 U.S.C. § 921(d)."

756 F.Supp. at 304. (As discussed infra, § 921(d) allows claimants

and deputy commissioners, but not employers, to obtain district

court enforcement of a compensation order making an award.)

In this case, subject matter jurisdiction can be viewed only

against the backdrop of the LHWCA statutory scheme. The employer's

liability under the LHWCA is "exclusive and in place of all other

liability of such employer to the employee ...." 33 U.S.C. §

905(a). As with other worker's compensation schemes, "the LHWCA

... represents a compromise between the interests of injured

workers, who receive a certain and immediate recovery, and the

interests of employers and insurers, who in turn receive `definite

and lower limits on potential liability than would have been

11
applicable in common-law tort actions for damages.'" In re Claim

for Compensation Under the Longshore & Harbor Workers Compensation

Act, 889 F.2d 626, 632 (5th Cir. 1989) (quoting Potomac Elec. Power

Co. v. Director, Office of Workers' Comp. Programs, 449 U.S. 268,

281-82 (1980)), cert. denied, 494 U.S. 1082 (1990).

This immediate recovery is translated through § 914, which

provides for prompt payment, unless the right to compensation is

timely controverted by the employer, § 914(d).12 "Thus, the scheme

of the LHWCA is that the employer is absolutely required to pay

compensation promptly on notice of injury and in the absence of a

timely written controversion." Atkinson v. Gates, McDonald & Co.,

838 F.2d 808, 810 (5th Cir. 1988). The LHWCA provides for

penalties of 10% for, among other things, failure to make timely

advance (without an award) payments, unless a notice to controvert

is timely filed, § 914(e), and 20% if an award is not timely paid,

unless review is sought and payment of the award is stayed, §

914(f).

Here, rather than timely controvert, Ceres Gulf made advance

payments to Cooper for approximately 18 months, until shortly

12
Section 914(d) provides:

If the employer controverts the right to
compensation he shall file with the deputy
commissioner on or before the fourteenth day after
he has knowledge of the alleged injury or death, a
notice, in accordance with a form prescribed by
the Secretary, stating that the right to
compensation is controverted, the name of the
claimant, the name of the employer, the date of
the alleged injury or death, and the grounds upon
which the right to compensation is controverted.

12
before he reached maximum medical improvement. As noted, the ALJ

and BRB held that the LHWCA, § 914(j), provides for reimbursement

of those payments only if unpaid installments of LHWCA compensation

remain owing. Section 914(j) states that "[i]f the employer has

made advance payments of compensation, he shall be entitled to be

reimbursed out of any unpaid installment or installments of

compensation due." The only other two sections of the LHWCA which

provide for recovery of overpayments are § 922, which provides for

such recovery after a final award is modified, but only out of

unpaid LHWCA compensation, and § 908(j), which provides for an

employer's recovery of compensation, but again only out of

compensation payable, for periods during which a disabled employee

fails to report, omits, or understates, employment-related

earnings. None of the three sections provides for the employer

recovering overpayments directly from the employee, as sought here;

such recovery, under the LHWCA, can only be an offset against

future LHWCA compensation.

Ceres Gulf contends that Cooper's claim that resulted in the

advance payments was fraudulent. The ALJ and BRB did not so hold.

But, in any event, the LHWCA, addresses fraudulent claims in ways

different from that urged by Ceres Gulf. First, it provides for a

fine or imprisonment for "[a]ny claimant ... who knowingly and

willfully makes a false statement or representation for the purpose

of obtaining a benefit or payment under" the LHWCA, § 931(a)(1).

The penalty does not include recovery of payments obtained as a

result of the false statement or representation. Second, an

13
employer may "discharge or refus[e] to employ a person who has been

adjudicated to have filed a fraudulent claim", § 948a. These were

part of the amendments in 1984 to the LHWCA to address a perceived

problem of claimant fraud. See S. Rep. No. 81, 98th Cong., 1st

Sess. 20-21, 37 (1983); 128 Cong. Rec. 18018-18019 (daily ed. July

27, 1982) (statement of Sen. Nunn); 127 Cong. Rec. 9835-9836 (daily

ed. May 14, 1981) (statement of Sen. Nunn). At that time, Congress

declined to provide for recovery of benefits to combat such fraud,

other than by the established offset method against LHWCA payments

owing. See H. Rep. No. 570, 98th Cong., 1st Sess. pt. 1 at 18

(1983), reprinted in 1984 U.S.C.C.A.N. 2734, 2751 (if the employee

failed to report earnings, § 908(j), "[t]he Committee does not

contemplate that the employer could bring a cause of action to

recover compensation paid in the past").

"Prior to the 1972 amendments to the Act, compensation orders

were directly reviewable by the district court. However, in 1972

Congress created the BRB to hear all direct appeals of compensation

orders. This replaced the district court's exercise of that

function." In re Claim, 889 F.2d at 629 (citations omitted). The

LHWCA still provides several bases for filing suit in district

court; but, as Ceres Gulf concedes, recovery of overpayments is not

one of them.13

13
For example, "if an employer fails to secure payment of
compensation as required by [the LHWCA], an injured employee ...
may ... maintain an action at law or in admiralty for damages on
account of such injury", § 905(a); the employer may sue a third
party to recover certain benefits if the "employee was injured
through the fault or negligence of [that] third party not in the
same employ", § 907(h); if the employer defaults in payment of

14
 As discussed, compensation orders may be reviewed by the BRB

and courts of appeals, § 921(b) and (c); orders making an award may

be enforced through the district courts, § 921(d). Of special

significance, § 921(e) provides that "[p]roceedings for suspending,

setting aside, or enforcing a compensation order, whether rejecting

a claim or making an award, shall not be instituted otherwise than

as provided in this section [§ 921] and section 918 ...."

Arguably, as discussed infra, the action filed by Ceres Gulf was

for the purpose of "suspending" or "setting aside" a "compensation

order ... rejecting a claim" and, therefore, prohibited by the

LHWCA, because it was a proceeding not included within the

statutory scheme.

1.

As noted, Ceres Gulf concedes that the LHWCA does not provide

an employer with a right to recover advance payments wrongfully

paid, such as through fraud, when no LHWCA compensation is owed.

The same conclusion was reached recently in Stevedoring Services of

America, Inc. v. Eggert, 953 F.2d 552 (9th Cir. 1992), where the

Ninth Circuit reversed the decision by the district court in

Washington State that was cited for support by the district court

in this action. It held, consistent with the Director's position

here, that the district court lacked jurisdiction to consider a

compensation due under an award, the employee, following
administrative proceedings, may obtain a default judgment in
district court, § 918(a); and likewise, and as noted earlier,
upon failure "to comply with a compensation order making an
award, that has become final", the employee or deputy
commissioner making the order may apply for enforcement of the
order in district court, § 921(d).

15
claim under the LHWCA by an employer to recover payments, although

wrongfully paid, when no future compensation payments were owed.

The Ninth Circuit examined various LHWCA provisions advanced

as bases for federal court jurisdiction. After determining that 33

U.S.C. §§ 918, 921 and 927 did not confer jurisdiction,14 it noted

that § 921(e) requires that "proceedings for suspending, setting

aside, or enforcing a compensation order ... not be instituted

otherwise than as provided" by §§ 918 and 921. 953 F.2d at 555.

Next, the court rejected the employer's contention that an

implied cause of action existed under the LHWCA, under either §

914(j) (employer entitled to reimbursement for advance payments out

of unpaid compensation due), § 922 (review of ALJ order because of

mistake or change in conditions), or § 908(j) (compensation paid

where employee misstates earnings recoverable through compensation

payable). Its analysis is similar to our basis, presented infra,

for finding jurisdiction lacking under 28 U.S.C. § 1331. It held

that:

Congress did not intend to permit an employer a
federal cause of action against a claimant for
repayment of alleged overpayments of compensation.
Although Congress did not expressly preclude an
employer action for repayment, its intent on this
issue is understood by the express provisions we
have examined. We will not rewrite or engraft new
remedies upon the provisions Congress has
affirmatively and specifically enacted. The

14
The court rejected jurisdiction based on §§ 921(d) and
918(a) because "[b]oth of these provisions concern employers who
are in default in payment of a compensation award and are thus
inapplicable here." 953 F.2d at 555. It likewise held that §
927(b) did not confer jurisdiction, because the employer's
complaint "was not an action to enforce compliance with a direct
order of the ALJ". Id.

16
 district court erred in holding that [the employer]
had an implied remedy under the LHWCA. Because
[the employer's] federal claims for recoupment are
without merit, the district court lacked
jurisdiction to entertain them.

953 F.2d at 557.

Thus, as Ceres Gulf concedes, and as the Ninth Circuit held

in Eggert, the LHWCA does not vest jurisdiction in the district

court for an employer's action to recover compensation wrongfully

received.15

2.

Ceres Gulf contends, instead, that the district court had

jurisdiction under the general federal question statute, 28 U.S.C.

§ 1331, which provides that the "district courts shall have

original jurisdiction of all civil actions arising under the

Constitution, laws, or treaties of the United States."16 It

15
Prior Fifth Circuit cases have assumed or implicitly
held an employer could not recover overpaid benefits except as
offsets against future payments. See Phillips v. Marine Concrete
Structures, Inc., 877 F.2d 1231, 1234 (5th Cir. 1989), vacated,
877 F.2d at 1237, rev'd on other grounds, 895 F.2d 1033 (5th Cir.
1990) (en banc); Rivere v. Offshore Painting Contractors, 872
F.2d 1187, 1191 (5th Cir. 1989); Henry v. Gentry Plumbing &
Heating Co., 704 F.2d 863, 865 (5th Cir. 1983).
16
Contrary to Fed. R. App. P. 28, Ceres Gulf, at oral
argument and in a subsequent letter brief, advanced for the first
time on appeal the theory that jurisdiction also exists under
admiralty and maritime law, pursuant to 28 U.S.C. § 1333. It is
more than well-established that legal theories may not be raised
on appeal in this fashion; we decline to consider this
contention. Because of our limited jurisdiction, we must always
be vigilant to ensure that we have subject matter jurisdiction,
addressing the issue sua sponte if need be. But, this discipline
is separate from our declining to address untimely raised legal
theories in support of that jurisdiction. We cannot allow such
legal theories to crop up at any point during the appeal; it is
not our role to exercise jurisdiction over any disputes that
might possibly fall within our limited reach. Considering Ceres

17
maintains that this case arises under the federal common law of

fraud and unjust enrichment; that the LHWCA does not prohibit this

"equitable action for reimbursement". It does not assert that this

form of action has been recognized by the federal courts. Rather,

it asks that we create a new cause of action under federal common

law, outside the LHWCA, citing Federal Marine Terminals, Inc. v.

Burnside Shipping Co., 394 U.S. 404 (1969), where the Supreme Court

found, outside the LHWCA, a right of subrogation by a stevedoring

contractor against a shipowner for LHWCA compensation payments. As

the Supreme Court noted:

The exclusivity of the [LHWCA] statutory
compensation remedy against the employer was
designed to counterbalance the imposition of
absolute liability; there is no comparable quid pro
quo in the relationship between the employer and
third persons. On the contrary, as we emphasized
in Ryan Stevedoring Co. v. Pan-Atlantic S. S.
Corp., 350 U.S. 124, the Act is concerned only with
the rights and obligations as between the
stevedoring contractor and the employee or his
representative. It does not affect independent
relationships between the stevedoring contractor
and the shipowner.

394 U.S. at 413. But here, of course, we are "concerned only with

the rights and obligations as between the [employer] and the

employee."

Gulf's belatedly asserted maritime jurisdiction theory would run
afoul of the well established procedures for timely presentation
of legal issues on appeal, in which all parties have the
opportunity to brief and argue issues within the established time
frame for doing so. This is not exalting form over substance;
far from it. Instead, in light of numerous obvious factors, such
as the skyrocketing cost of litigation, our burgeoning caseload,
and the ever increasing demands on overstrained judicial
resources, it is a necessity for the orderly and fair
administration of justice.

18
 We lack jurisdiction to even consider this asserted federal

common law right. The LHWCA creates no remedy, enforceable in the

district court, for an employer to recover overpayments. Moreover,

the LHWCA is the only potential source for federal court

jurisdiction in this case. But, § 1331 jurisdiction is unavailable

where, as here, Congress has created a specific, statutorily-

defined scheme that clearly supplants the general jurisdictional

statute. See Whitney Nat'l Bank in Jefferson Parish v. Bank of

New Orleans & Trust Co., 379 U.S. 411, 420 (1965) ("where Congress

has provided statutory review procedures designed to permit agency

expertise to be brought to bear on particular problems, those

procedures are to be exclusive"); Compensation Dept. of Dist. Five,

United Mine Workers of Am. v. Marshall, 667 F.2d 336, 341 (3d Cir.

1981) (applying Whitney to the LHWCA).

As outlined, through the LHWCA Congress has provided a

detailed scheme for presentation, payment, adjudication and review

of claims covered by the LHWCA. Among other things, it empowers

the deputy commissioner to order a hearing before an ALJ, § 919(c),

and authorizes appeals of claim determinations to the BRB, §

921(b), with review of its orders in a court of appeals, § 921(c).

And, the district courts have authority to enforce compensation

orders making an award against employers, § 921(d). The LHWCA

neither expressly, or impliedly, allows the action in issue. In

fact, it is contrary to the statutory scheme. This case is not

here on review of the BRB ruling. Ceres Gulf has avoided that

statutorily prescribed method of review by filing a separate action

19
in the district court. The LHWCA provides, however, in § 921(e)

that its method for deciding and reviewing claims is exclusive.

Accordingly, we lack jurisdiction to consider Ceres Gulf's

federal common law theory. See Watson v. Massman Constr. Co., 850

F.2d 219, 224 & n.27 (5th Cir. 1988) (no jurisdiction to resolve

question of entitlement to benefits under LHWCA because litigant

did not comply with statutory administrative scheme and judicial

review). See also Connors v. Amax Coal Co., 858 F.2d 1226 (7th

Cir. 1988), concerning a claim for equitable reimbursement under

the Black Lung Benefits Act, 30 U.S.C. § 901 et seq., which

incorporates the LHWCA claim procedures. In rejecting an assertion

that it had § 1331 jurisdiction stemming out of a federal common

law right, the court stated:

To establish a cause of action in district court
under section 1331 the [plaintiffs] must show first
that their action against [defendant] "arises
under" ... federal common law and second that
section 1331 jurisdiction is not preempted by a
more specific statutory provision conferring
exclusive jurisdiction elsewhere.

858 F.2d at 1229-30.17 Restated, we lack jurisdiction because,

under the facts of this case, § 1331 jurisdiction, if any, for this

asserted right is preempted by the LHWCA.

Ceres Gulf contends, however, that it is not seeking review of

the administrative adjudication; that, instead, it is seeking to

enforce an administrative order or seeking a remedy that the

17
See also Owner-Operators Indep. Drivers' Ass'n of Am.,
Inc. v. Skinner, 931 F.2d 582, 589 (9th Cir. 1991); Connors v.
Oglebay Norton Co., 848 F.2d 84, 85 (6th Cir. 1988); Connors v.
Tremont Mining Co., 835 F.2d 1028, 1029-30 (3d Cir. 1987).

20
federal courts, but not the agency, are competent to give; that the

remedy it seeks is derived outside the LHWCA, so that its exclusive

review provisions do not apply.

We disagree. As noted, the ALJ and BRB held -- and Ceres Gulf

concedes -- that, under the LHWCA, it was not entitled to recovery.

Ceres Gulf is attempting an impermissible end run around the LHWCA,

seeking to replace review of the BRB determination with suit in

district court. It is not seeking to enforce the agency rulings;

it pursues a contrary result. It is seeking, in essence, to set

aside the compensation order, which § 921(e) expressly prohibits

being done except through the procedures established in §§ 921 and

918.

In sum, allowing this separate action would run counter not

only to the express provisions of the LHWCA -- which, alone, ends

the inquiry -- but also to the underlying purpose of the Act. To

allow this separate action, we would have to ignore the compromise

effected by the exclusivity aspects of the LHWCA, under which the

employee is barred from suing the employer, in exchange for more

prompt and certain, although possibly lower, recovery. The LHWCA

precludes the employee's suit, yet Ceres Gulf seeks to hale the

employee into federal court because of a claimed gap in the LHWCA,

concerning recovery of wrongful advance payments.18 The cure lies

with Congress, not federal courts.

18
One remedy against such payments is the employer's
statutorily prescribed right to timely controvert -- a right
Ceres Gulf did not exercise.

21
 III.

For the foregoing reasons, the order denying intervention and

the judgment are REVERSED and this case is REMANDED with

instructions to dismiss for lack of subject matter jurisdiction.

REVERSED and REMANDED.

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