Hice v. Director, Office of Workers' Compensation Programs

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 1, 1998 Decided September 29, 1998

No. 97-1250

Larry Hice,

Petitioner

v.

Director, Office of Workers' Compensation Programs,

United States Department of Labor

and

Electrospace Systems, Inc.,

Respondents

On Petition for Review of an Order of the

Benefits Review Board

Benjamin T. Boscolo argued the cause and filed the brief
for petitioner.

Samuel J. Oshinsky, Counsel, U.S. Department of Labor,
argued the cause for respondent Director, OWCP. With him
on the brief was Carol A. De Deo, Associate Solicitor.

Roy D. Axelrod argued the cause and filed the briefs for
respondent Electrospace Systems, Inc.

Before: Wald, Williams and Tatel, Circuit Judges.

Opinion for the Court filed by Circuit Judge Tatel.

Tatel, Circuit Judge: In search of a court with jurisdiction
to hear his appeal from a Benefits Review Board decision
denying him workers' compensation benefits for injuries sus-
tained while working on a U.S. military base in Australia,
petitioner first filed his appeal in the Ninth Circuit and now
seeks to have his case heard here, arguing that we have
jurisdiction because the administrative law judge who adjudi-
cated his claim has his office in Washington, D.C. Because
we hold that the location of the office of the District Director
for the Office of Workers' Compensation Programs who han-
dled petitioner's case--the District Director for Baltimore,
Maryland--determines the proper forum to hear petitioner's
appeal, and because Fourth Circuit precedent requires judi-
cial review of Benefits Review Board decisions to occur first
in district courts, we transfer this case to the U.S. District
Court for the District of Maryland.

I.

The jurisdictional issue presented here arises from the fact
that the two statutes involved in this case contain different
provisions for judicial review. The first of these statutes, the
Longshore Act of 1927, Act of Mar. 4, 1927, ch. 509, 44 Stat.
1424 (codified as amended at 33 U.S.C. ss 901-950 (1994)),
established a comprehensive workers' compensation program
to provide medical, disability, and survivor benefits to long-
shoremen and their families for work-related injuries and
death. See 33 U.S.C. ss 902-904 (1970) (amended 1972).
Under the program, injured workers filed claims with local
deputy commissioners for the Office of Workers' Compensa-
tion Programs, who adjudicated disputes. See id. s 919.
Dissatisfied claimants appealed to "the federal district court
in which the injury occurred." Id. s 921(b).

Congress enacted the second statute involved in this case,
the Defense Base Act of 1941, Act of Aug. 16, 1941, ch. 357,
55 Stat. 622 (codified as amended at 42 U.S.C. ss 1651-1654
(1994)), in order to extend the benefits of the Longshore Act
to individuals working on military bases outside the United
States. Because nothing in the Longshore Act provided for
either the filing of claims or the appeal of benefits determina-
tions for injuries occurring outside of the country, section 3 of
the Defense Base Act (1) authorized the Secretary of Labor
to create compensation districts for all regions of the world
and assign them to deputy commissioners throughout the
United States, see 42 U.S.C. s 1653(a) (1994); 20 C.F.R.
s 704.101 (1998), and (2) provided for judicial review "in the
United States district court of the judicial district wherein is
located the office of the deputy commissioner whose compen-
sation order is involved." 42 U.S.C. s 1653(b). As originally
enacted, the two statutes worked together to provide for
benefits determinations and judicial review for covered work-
ers anywhere in the world. All appeals were heard by U.S.
District Courts--for injuries occurring in the United States,
appeals went to the district court for the district where the
injury occurred; for injuries occurring outside the United
States, appeals went to the district court with jurisdiction
over the deputy commissioner who issued the compensation
order.

In 1972, Congress made two changes to the Longshore Act
that created the jurisdictional issue at the heart of this case.
First, it split the role of the deputy commissioner with
respect to the handling of workers' compensation claims by
transferring all hearing functions to administrative law
judges. See Longshoremen's and Harbor Workers' Compen-
sation Act Amendments of 1972, Pub. L. 92-576, s 14, 86 Stat.
1251, 1261 (codified at 42 U.S.C. s 919(d) (1994)). Second, it
established the Benefits Review Board to hear administrative
appeals of ALJ decisions and amended the judicial review
provisions to provide that "[a]ny person adversely affected
or aggrieved by a final order of the Board may obtain a re-
view of that order in the United States court of appeals for
the circuit in which the injury occurred." Pub. L. 92-576,
s 15(a), 86 Stat. 1251, 1261-62 (codified at 42 U.S.C. s 921(c)
(1994)) (emphasis added).

For injuries occurring within the United States, the judicial
review provisions of the amended Longshore Act remained
unambiguous: A dissatisfied claimant now appealed adverse
Benefits Review Board decisions to the U.S. Court of Appeals
for the "circuit in which the injury occurred." But Congress
made no corresponding change to the Defense Base Act,
leaving workers injured outside the United States with some
uncertainty about which courts had jurisdiction to hear their
appeals. Would they still follow the plain language of section
3(b) of the Defense Base Act and take their cases to the
district court "of the judicial district wherein is located the
office of the deputy commissioner whose compensation order
is involved"? Or in view of the 1972 amendments' transfer of
adjudicatory authority to ALJs, would claimants appeal to the
district court "wherein is located the office of the administra-
tive law judge"? And did Congress really intend to create a
dual scheme under which workers injured within the United
States would appeal Benefits Review Board decisions directly
to courts of appeals, while workers injured on military bases
outside the country would appeal first to district courts, and
then to courts of appeals? Or notwithstanding the 1972
amendments' use of the phrase "the circuit in which the
injury occurred," did Congress actually intend to require even
those injured outside the United States also to appeal directly
to circuit courts?

Seven years ago petitioner Larry Hice suffered a heart
attack while working on a military base in Australia for
respondent Electrospace Systems, Inc. He filed his workers'
compensation claim with the district director in Hawaii, who
then transferred the case to the district director in Baltimore
because that office was closest to Hice's U.S. residence. (The
regulations implementing the Longshore Act have substituted
the term district director for deputy commissioner. "The
substitution is purely an administrative one, and in no way
effects (sic) the authority of or the powers granted and the
responsibilities imposed by the statute on that position." 20
C.F.R. s 702.105 (1998).)

The Baltimore District Director assigned Hice's case to an
ALJ in Washington, D.C. Following a hearing, the ALJ

denied Hice's claim. The Benefits Review Board, also in
Washington, affirmed the ALJ's decision. Hice then sought
judicial review of the Board's decision in the Ninth Circuit,
presumably because that circuit's jurisdiction includes the
office of the District Director of Hawaii, or perhaps because
the Ninth Circuit is the circuit closest to Australia. Realizing
that he had chosen the wrong forum for his appeal and
emphasizing that the ALJ who decided his case had his office
in the District of Columbia, Hice asked the Ninth Circuit to
transfer his case either to the U.S. District Court for the
District of Columbia or to this Court. The Ninth Circuit
transferred the case here, relying on its decision in Pearce v.
Director, OWCP, 603 F.2d 763 (9th Cir. 1979), which said that
judicial review of Defense Base Act claims lies in the circuit
court with jurisdiction over the office of the district director
"or administrative law judge whose compensation order is
involved." Id. at 771.

The parties' original briefs in this Court focused exclusively
on the merits of Hice's claim. On our own motion, we
directed the parties to brief the question whether the Defense
Base Act requires transfer of this case to the U.S. District
Court for the District of Columbia or to the U.S. District
Court for the District of Maryland. Hice v. Director, OWCP,
No. 97-1250 (D.C. Cir. Nov. 10, 1997). We also severed this
jurisdictional question from the merits. Hice v. Director,
OWCP, No. 97-1250 (D.C. Cir. Feb. 5, 1998).

II.

In their briefs on the jurisdictional issue, all three parties
argue that the 1972 amendments to the Longshore Act
amended the Defense Base Act and now require that a court
of appeals, not a district court, hear Hice's appeal even
though his injuries were not sustained in the United States.
Both Hice and Electrospace argue that this court should
retain jurisdiction because the ALJ who heard Hice's case has
his office in Washington, D.C. In his brief, the Director of
the Office of Workers' Compensation Programs urges us to
transfer the case to the Fourth Circuit because the office of
the district director handling Hice's claim is in Baltimore.

We understand Hice and Electrospace would prefer to have
this seven-year-old case resolved here and now. We also
understand the Director's preference for a uniform system of
judicial review under which review of both Longshore Act and
Defense Base Act claims would occur only in courts of
appeals. But we cannot quite so easily disregard the Defense
Base Act's requirement that judicial review of claims under
that act occur in the "United States district court of the
judicial district wherein is located the office of the deputy
commissioner [now district director] whose compensation or-
der is involved." 42 U.S.C. s 1653(b) (1994) (emphasis add-
ed). Nothing in either the language or legislative history of
the 1972 amendments to the Longshore Act suggests that
Congress meant to amend section 3(b) of the Defense Base
Act. Indeed, Congress's choice of the words "circuit in which
the injury occurred" suggests that it did not intend the
judicial review provisions of the amended Longshore Act to
cover injuries occurring outside the United States. For these
reasons, and because Hice seeks benefits under the Defense
Base Act, we think it best to begin with that act's jurisdiction-
al provision. Given that the 1972 amendments shifted deputy
commissioners' hearing authority to ALJs, we must deter-
mine whether the district director (in this case, the District
Director for Baltimore) or the ALJ (in this case, with an
office in Washington, D.C.) is, for all practical purposes, the
deputy commissioner as provided in the original statute.

Relying on the Ninth Circuit's decision in Pearce, Hice and
Electrospace argue that ALJs now stand in the shoes of
deputy commissioners for the purpose of determining the
proper court for judicial review. According to Electrospace,
the ALJ, not the district director, decides the dispute as to
compensation, and it is the ALJ's "compensation order [that]
is involved." Id.

The Director argues that the 1972 transfer of hearing
authority from deputy commissioners to ALJs had no effect
on the Defense Base Act's requirement that benefits determi-
nations be reviewed by the district court of the district
"wherein is located the office of the deputy commissioner
whose compensation order is involved." According to the

Director, the location of the ALJ who decides a compensation
claim is "utterly fortuitous" and "generally has no bearing on
any aspect of the case." Director's Brief at 4. "The cite (sic)
of the hearing is generally not the site of the ALJ's office.
Indeed, ALJ's frequently travel nation-wide to hear cases."
Id. In contrast, the Director points out, cases are assigned to
the district director closest to the claimant's U.S. residence.
Although the ALJ adjudicated the claim in this case, district
directors issue compensation orders when no factual dispute
exists between the parties. In every case, moreover, district
directors file and serve compensation orders and retain con-
tinuing jurisdiction to resolve medical disputes that arise
after initial adjudication of claims. See 33 U.S.C. ss 907,
919(e). District directors also have authority to transfer
claims to other districts "for the purpose of making investiga-
tion, taking testimony, making physical examination or taking
such other necessary action therein as may be directed." Id.
s 919(g).

Though we owe the Director no Chevron deference on this
jurisdictional issue, see Ramey v. Bowsher, 9 F.3d 133, 137
n.7 (D.C. Cir. 1993), we agree that the location of the office of
the district director determines the proper forum for judicial
review. Despite the transfer of adjudicative functions to
ALJs, the Director has made a convincing case that district
directors remain the officials in the Department of Labor
primarily responsible for workers' compensation claims. To
hold, as Hice and Electrospace urge, that jurisdiction travels
with the ALJ who happens to hear a particular claim would
add even more variability and uncertainty to the confusion
surrounding judicial review under the Defense Base Act. We
are aware that Pearce mentions the location of the ALJ's
office as a possible basis for determining which court has
jurisdiction, but we view that language as dictum because the
compensation order in that case arose from a deputy commis-
sioner's decision, not an ALJ's. We thus hold that section
3(b) of the Defense Base Act governs the jurisdictional issue
here: The location of the deputy commissioner, now the
district director, who handled Hice's claim determines the
proper court to hear his appeal.

 III.

Interpreting the words "deputy commissioner" in the De-
fense Base Act to mean the district director does not resolve
this case. We must also consider whether, notwithstanding
section 3(b)'s vesting of jurisdiction in district courts, the 1972
amendments to the Longshore Act require that we transfer
this case to the Fourth Circuit. Although the Director's brief
argues that the Fourth Circuit is the proper forum for Hice's
appeal, at oral argument he took what we believe to be a
more sensible position: Relying on the Fourth Circuit's deci-
sion in Lee v. Boeing, 123 F.3d 801 (4th Cir. 1997), the
Director now urges us to transfer this case directly to the
U.S. District Court with jurisdiction over Baltimore. Facing
precisely the same issue presented here, the Fourth Circuit
held that the unambiguous language of the Defense Base Act
requires cases involving injuries occurring outside the United
States to be heard by district courts, not by courts of appeals:

Since section 3(b) of the DBA unambiguously provides
that initial judicial review of Board decisions in DBA
cases lies in the district court, "jurisprudential modifica-
tion of its plain statutory language would amount to
judicial legislation."

We realize that our conclusion results in a somewhat
cumbersome and duplicative review procedure in DBA
cases and that Congress may not have made a conscious
decision to create such a procedure. However, "it is not
our function to correct Congressional oversight.... It
is for Congress to eliminate any redundant steps insinu-
ated by the 1972 amendments to the LHWCA." We
must enforce section 3(b) according to its plain, unambig-
uous language. Accordingly, we conclude that we do not
have jurisdiction to hear the instant appeal.

Lee, 123 F.3d at 806 (internal citations omitted) (ellipsis in
original). The Fifth and Sixth Circuits have reached precise-
ly the same result. See AFIA/CIGNA Worldwide, 930 F.2d

1111 (5th Cir. 1991); Home Indemnity Co. v. Stillwell, 597
F.2d 87 (6th Cir. 1979). While Congress's use of the phrase
"in the United States court of appeals for the circuit in which
the injury occurred" leaves us inclined to agree with the
Fourth, Fifth, and Sixth Circuits, we need not decide that
issue for ourselves. Because we have held that under the
Defense Base Act the location of the district director--here,
Baltimore--identifies the location of judicial review, see pp.
5-7 supra, and because the Fourth Circuit has plainly held
that cases arising within its jurisdiction should be heard first
by U.S. District Courts, we transfer this case to the U.S.
District Court for the District of Maryland.

So ordered.