Wheaton v. Golden Gate Bridge, Highway & Transportation District

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

GALE WHEATON, 
Petitioner,
v.
GOLDEN GATE BRIDGE, HIGHWAY & No. 07-72141
TRANSPORTATION DISTRICT;
NATIONAL UNION FIRE INSURANCE  BRB No.
06-0672
COMPANY OF PITTSBURGH,
PENNSYLVANIA, and DIRECTOR, OPINION
OFFICE OF WORKERS’ COMPENSATION
PROGRAMS, UNITED STATES
DEPARTMENT OF LABOR,
Respondents.

On Petition for Review of a
Final Order of the
Benefits Review Board

Argued and Submitted
December 12, 2008—San Francisco, California

Filed March 16, 2009

Before: Betty B. Fletcher and M. Margaret McKeown,
Circuit Judges, and William T. Hart*, District Judge.

Per Curiam Opinion

*The Honorable William T. Hart, United States District Judge for the
Northern District of Illinois, is sitting by designation.

3375
3378 WHEATON v. GOLDEN GATE BRIDGE

COUNSEL

John Ralph Hillsman, Esquire, McGuinn, Hillsman & Palef-
sky, San Francisco, California, for the petitioner.

Helen Hart Cox, Attorney, U.S. Department of Labor, Wash-
ington, DC, for the respondents.
 WHEATON v. GOLDEN GATE BRIDGE 3379
OPINION

PER CURIAM:

Gale Wheaton appeals the denial of his claim for disability
benefits under the Longshore and Harbor Workers’ Compen-
sation Act (“LHWCA”). Gale Wheaton was a ferry repairman
and mechanic in the Ferry Division of the Golden Gate
Bridge, Highway & Transportation District (the “District”). In
October 1999, he suffered a back injury while working aboard
a vessel on navigable waters of the United States. Wheaton
has been paid benefits under California workers’ compensa-
tion law. If covered by the LHWCA, he would be entitled to
additional disability benefits. The dispute turns on whether
the District is a “subdivision” of a state as that term is used
in § 3(b) of the LHWCA, 33 U.S.C. § 903(b), which provides:
“No compensation shall be payable in respect of the disability
or death of an officer or employee of the United States, or any
agency thereof, or of any State or foreign government, or any
subdivision thereof.”

An administrative law judge (“ALJ”) found, relying on
facts stipulated to by the parties, that the District was a subdi-
vision of the State of California and therefore was excluded
from coverage under the LHWCA. Wheaton timely appealed
to the LHWCA Benefits Review Board (“BRB”), which
affirmed. Before this court, both the District and the United
States Department of Labor, by the Director of the Office of
Workers’ Compensation Programs (the “Director”), argue for
affirmance.

The parties agree that the District is not an arm of the state
entitled to the protections of the Eleventh Amendment nor
entitled to state sovereign immunity from federal claims. Case
law supports those conclusions. See Michaeledes v. Golden
Gate Bridge, Highway & Transp. Dist., 202 F. Supp. 2d 1109,
1112-13 (N.D. Cal. 2002). See also Dougherty v. Golden Gate
Bridge, Highway & Transp. Dist., 31 F. Supp. 2d 724, 727 &
3380 WHEATON v. GOLDEN GATE BRIDGE
n.3 (N.D. Cal. 1998) (dictum that the District “likely” is not
an arm of the state). They also agree that, under California
law, the District has the status of a local public agency such
as a county or municipality. The parties further stipulated to
a number of facts related to the District’s creation, administra-
tion, operations, and powers.

The ALJ applied, and the BRB affirmed, application of a
multifactor test for determining whether a public entity is a
subdivision. This test was derived from our precedent as well
as guidance from the United States Supreme Court and the
Benefits Review Board. See Tyndzik v. Director, OWCP, 53
F.3d 1050, 1052-53 (9th Cir. 1995); Keating v. City of Titus-
ville, 31 BRBS 187 (BRB 1997); NLRB v. Natural Gas Util.
Dist. of Hawkins County, Tenn., 402 U.S. 600, 605-09 (1971)
(interpreting “political subdivision” as used in the NLRA, 29
U.S.C. § 152(2)).

[1] In Tyndzik, 53 F.3d at 1052-53 & n.5, we held that the
University of Guam was not a subdivision of a state1 as that
term is used in the LHWCA. We noted that the University
was created by the legislature, had a Board of Regents
appointed by the legislature, and had a budget controlled by
the legislature. However, we held the University was not a
subdivision of Guam because the Guam government did not
otherwise control the University and the University could not
perform basic government functions on its own, take property
by eminent domain, enact ordinances, or impose taxes. In so
holding, we stated that the University was not “akin” to a
municipality, which would qualify it as a subdivision, citing
dictum from Purnell v. Norned Shipping B.V., 801 F.2d 152,
154 n.2 (3d Cir. 1986). Tyndzik, 53 F.3d at 1053. We cited the
NLRA definition of “political subdivision” as being analo-
gous and the facts that we relied on are among the factors
considered in determining whether an entity is a “political
1
As used in the LHWCA, “State” includes a territory. 33 U.S.C.
§ 902(8).
 WHEATON v. GOLDEN GATE BRIDGE 3381
subdivision” as that term is used in § 2(2) of the NLRA,
29 U.S.C. § 152(2). See Hawkins County, 402 U.S. at 606-09;
Molina v. Union Independiente Autentica De La AAA, 555
F. Supp. 2d 284, 299 (D.P.R. 2008).

[2] Factors that may be considered under the Hawkins
County test in determining whether the entity’s actual opera-
tions and characteristics support the conclusion that it is a
subdivision of a state include: (a) whether the entity was cre-
ated by state law; (b) whether the entity was granted all the
powers necessary to exercise its functions; (c) whether the
entity has the power of eminent domain; (d) whether the
entity has the power to assess or collect taxes; (e) the entity’s
status under state law; (f) whether the entity is exempt from
federal taxation; (g) whether the entity’s operations are sub-
ject to public hearing and its records open to the public; (h)
whether the officials administering the entity are responsible
to the public or public officials; (i) whether social security
benefits for the entity’s employees are provided through vol-
untary rather than mandatory coverage; (j) whether the enti-
ty’s officers receive nominal compensation; and (k) whether
the entity has the power of subpoena. See Hawkins County,
402 U.S. at 606-09; see also Ayres v. International Bhd. of
Elec. Workers, 666 F.2d 441, 442 (9th Cir. 1982).

Petitioner contends that the BRB erred in relying on
Tyndzik and the Hawkins County factors in determining that
the District is a subdivision for purposes of the LHWCA.
Petitioner also contends that, even if the BRB properly relied
on the Hawkins County factors, it misapplied them to the stip-
ulated facts. This court has established the standard for review
in LHWCA benefits cases, including a determination based
on stipulated facts.

Whether an employee who seeks benefits is cov-
ered by the LHWCA is a mixed question of fact and
law. Harbor Tug & Barge Co. v. Papai, 520 U.S.
548, 553-54 (1997). Where, as here, the underlying
3382 WHEATON v. GOLDEN GATE BRIDGE
facts are undisputed, LHWCA coverage is decided
as a matter of law. See id. We review “questions of
law, including interpretations of the LHWCA,” de
novo. Gen. Const. Co. v. Castro, 401 F.3d 963, 965
(9th Cir. 2005). Because the BRB is not a policy-
making body, its construction of the LHWCA is not
entitled to any “special deference.” M. Cutter Co. v.
Carroll, 458 F.3d 991, 993 (9th Cir. 2006) (internal
quotation marks omitted). However, we will “ ‘re-
spect the Board’s interpretation of the [LHWCA]
where such interpretation is reasonable and reflects
the policy underlying the statute.’ ” Id. (quoting
McDonald v. Dir., OWCP, 897 F.2d 1510, 1512 (9th
Cir. 1990)).

Peru v. Sharpshooter Spectrum Venture LLC, 493 F.3d 1058,
1061 (9th Cir. 2007). Additionally, the Director’s interpreta-
tion of the LHWCA, even when advanced during litigation,
will be accorded “considerable weight.” Healy Tibbitts Build-
ers, Inc. v. Director, OWCP, 444 F.3d 1095, 1098 (9th Cir.
2006) (citing Mallott & Peterson v. Director, OWCP, 98 F.3d
1170, 1172 (9th Cir. 1996)); Christensen v. Stevedoring Serv.
of Am., Inc., 430 F.3d 1032, 1034-35 (9th Cir. 2005) (quoting
Force v. Director, OWCP, 938 F.2d 981, 983 (9th Cir. 1991)).
“Where the relevant statute is ‘easily susceptible’ of the
Director’s interpretation, ‘we need go no further.’ ” Christen-
sen, 430 F.3d at 1035 (quoting Force, 938 F.2d at 984).
Accord Healy, 444 F.3d at 1098 (quoting Mallott, 98 F.3d at
1172).

As originally enacted and until amended in 1984, the perti-
nent provision was contained in § 3(a)(2) of the LHWCA,
33 U.S.C. § 903(a)(2), and read the same except that the word
“political” was before “subdivision.” See Pub. L. 98-426 § 3,
98 Stat. 1640 (Sept. 28, 1984). The LHWCA contains no defi-
nition of “subdivision” and there are no regulations providing
a definition. The legislative history from the original enact-
ment in 1927 contains nothing addressing this term nor is
 WHEATON v. GOLDEN GATE BRIDGE 3383
there any legislative history from the 1984 amendment that
aids in interpreting the term or explaining why “political” was
dropped from the statutory language.

[3] Along with Tyndzik, other courts have consistently held
that municipalities and agencies of municipalities fall within
the meaning of subdivision as that term is used in the
LHWCA. See O’Brien v. City of New York, 822 F. Supp. 943,
950 (E.D.N.Y. 1993); Bagrowski v. American Export
Isbrandtsen Lines, Inc., 305 F. Supp. 432, 433 (E.D. Wis.
1969), rev’d on other grounds, 440 F.2d 502 (7th Cir. 1971);
City of Plantation v. Roberts, 342 So. 2d 69, 71 & n.1 (Fla.
1976). Also, when the LHWCA was passed in 1927, the term
“political subdivision” was commonly used to include munic-
ipalities. See, e.g., First Nat’l Bank v. City of Hartford, 273
U.S. 548, 551 (1927) (quoting Wis. Stat. § 70.11) (“any
county, town, city village, school district, or other political
subdivision of this state”); General Am. Tank Car Corp. v.
Day, 270 U.S. 367, 371-72 (1926) (referring to municipalities
and parishes of Louisiana as “political subdivisions”); Joslin
Mfg. Co. v. City of Providence, 262 U.S. 668, 674 (1923)
(“[m]unicipalities are political subdivisions of the state”); City
of Trenton v. State of N.J., 262 U.S. 182, 185-86 (1923) (“The
city is a political subdivision of the state, created as a conve-
nient agency for the exercise of such of the governmental
powers of the state as may be intrusted to it.”).

Wheaton argues that the consistent line of cases that hold
the plain meaning of “subdivision” includes municipalities,
schools districts, and the like should not be followed in inter-
preting § 3(b) because such a construction is inconsistent with
the purposes and structure of the LHWCA. Wheaton reasons
that (a) only a federal law such as the exclusive remedy provi-
sion of § 5 of the LHWCA, 33 U.S.C. § 905, can immunize
a municipal entity against federal maritime law; (b) if a
municipality, which is not protected by the Eleventh Amend-
ment or state sovereign immunity from federal claims, is
excluded from the LHWCA as a political subdivision, it will
3384 WHEATON v. GOLDEN GATE BRIDGE
not have protection from maritime tort liability claims of its
maritime employees; and (c) this result would be inconsistent
with a purpose of the LHWCA, which is to protect employers
from such liability to its employees. Thus, Wheaton argues
that “subdivision” in the LHWCA should be read to include
only arms of the state, which the parties agree the District is
not.

[4] A key problem with this reasoning is that there is no
legislative history supporting Wheaton’s view. Instead, the
legislative history indicates that the primary purposes of the
LHWCA were to provide workers’ compensation protection
for those maritime workers who would not be covered by
state workers’ compensation laws under Southern Pac. Co. v.
Jensen, 244 U.S. 205 (1917), and its progeny, and to protect
employers, not from maritime tort liability, but from the
uncertainty of whether employees were or were not covered
by state compensation laws. See Calbeck v. Travelers Ins.
Co., 370 U.S. 114, 119-24 (1962). Wheaton argues that a pur-
pose of protecting the employer from tort liability should be
assumed for the LHWCA because the LHWCA contains an
exclusive remedy provision, 33 U.S.C. § 905, and a purpose
of most workers’ compensation acts is that they provide a
tradeoff between liability without the need to prove fault and
a more limited recovery. See Bradford Elec. Light Co. v.
Clapper, 286 U.S. 145, 159 (1932), overruled on other
grounds, Crider v. Zurich Ins. Co., 380 U.S. 39 (1965). No
legislative history, however, supports that this was a principal
purpose for passing the LHWCA; nor that the exclusion for
political subdivisions was in any way related to respect for
sovereign immunity.

[5] Wheaton contends that, in the phrase “any State or for-
eign government,” “State” should be read as a modifier of
“government.” The pertinent statutory language would then
read: “any State . . . government, or any subdivision thereof.”
That language referring to a subdivision of State government
then is meant to be limited to departments or arms of the State
 WHEATON v. GOLDEN GATE BRIDGE 3385
government. The more natural reading, however, is to read
“State” or “foreign government” as two separate nouns. The
original language of the statute containing “political subdivi-
sion” was understood as referring to an entity in the state, not
just a department of the government. There is nothing to indi-
cate that dropping “political” from the statute was meant to
effect a substantive change.

[6] The plain language of the statute—“a State . . . or any
subdivision thereof”—should be read as including municipali-
ties of a state, not just arms of a state as Petitioner contends.
Cf. Pacific Mar. Ass’n v. Local 63, Int’l Longshoremen’s &
Warehousemen’s Union, 198 F.3d 1078, 1081 (9th Cir. 1999)
(construing similar language in the NLRA). Moreover, even
were the statutory language open to more than one interpreta-
tion, the BRB’s and Director’s construction should be
respected and upheld as long as it is reasonable. Peru, 493
F.3d at 1061; Healy, 444 F.3d at 1098. It is reasonable to con-
strue subdivision of a State as including municipalities of a
State. Such a construction by the BRB and Director is also
reasonable in light of the consistent case law so construing
§ 3(b). See O’Brien, 822 F. Supp. at 950; Bagrowski,
305 F. Supp. at 433; Roberts, 342 So. 2d at 71; see also
Tyndzik, 53 F.3d at 1053; Purnell, 801 F.2d at 154 n.2. See
also Pacific Mar., 198 F.3d at 1081. The Hawkins County test
should be applied to determine whether the District is a subdi-
vision of California.

[7] We further find, contrary to Petitioner’s contention, that
the BRB weighed the Hawkins County factors correctly in
finding that the District is a subdivision of the state. As stipu-
lated by the parties, the District was created pursuant to state
law and following a vote in a six-county area. The District’s
directors are appointed by local elected officials. Meetings of
the District’s board are open to the public and the District
must follow state competitive bidding requirements. The Dis-
trict is a corporate body that may take action in its own name.
Its employees are employees of the District, not employees of
3386 WHEATON v. GOLDEN GATE BRIDGE
the state. In accordance with applicable statutes, the District
has full power to perform and fund all its functions. Actions
of the District’s board are effected through ordinances, resolu-
tions, and motions. The District cannot levy taxes, but it
establishes and collects tolls and can issue bonds in its own
name to finance its functions. It also may obtain federal fund-
ing in its own name. The District also has the power of emi-
nent domain. It may enter into contracts, including contracts
with other public entities. It may establish rules and regula-
tions governing the use of its property. Within the confines of
the California Vehicle Code, the District establishes traffic
regulations for traveling on its facilities and the California
Highway Patrol enforces violations of the District’s traffic
rules. Under California law, it is considered a local public
agency with the same status and tort immunities as a county
or municipality.

[8] The factors that were considered in Hawkins County
and Tyndzik support the BRB’s holding that the District is a
subdivision of the state. Although the BRB did not have
before it stipulated facts relevant to every factor, the District
possessed sufficient characteristics of a political subdivision
to render the BRB’s finding reasonable. Petitioner contends
the facts do not support that the District is a subdivision of the
State because it is financially independent of the state, none
of the members of its board are elected, and providing mass
transportation by ferry is not a basic governmental function.
Being financially independent of the state helps establish that
the District is not an arm of the state, but not necessarily that
it is a private corporation. Municipalities and other local enti-
ties are financially independent of the state, but are still politi-
cal subdivisions. Having the District’s board appointed by
local officials is a factor favoring a determination that it is a
subdivision; it is not necessary that the board itself be elected
or composed of officials elected to other positions.2 Appoint-
2
The ALJ cited Cal. Streets & Highway Code § 27510 for the proposi-
tion that 8 members of the 19-member board must be elected local offi-
cials.
 WHEATON v. GOLDEN GATE BRIDGE 3387
ment of the governing board by elected officials favors the
conclusion that the entity is a subdivision of the state. Haw-
kins County, 402 U.S. at 605. The District manages a bridge,
including the highway that goes over it. It also manages pub-
lic transportation by bus and ferry. These are governmental
functions. See Commissioner of Internal Revenue v. Harlan,
80 F.2d 660, 661-62 (9th Cir. 1935) (in holding, for purposes
of a tax ruling, that the District was engaged in governmental
functions, the court stated “the maintenance of highways, and
consequently of bridges and ferries connecting the same, by
the government or its subdivisions” is “well established” to be
the “exercise of an essential governmental function”); United
States v. Washington Toll Bridge Auth., 307 F.2d 330, 332-33
(9th Cir. 1962). The other factor raised by petitioner is that
the District has no taxing powers. Highways and bridges are
often funded by tolls instead of local taxes, as is the District.
The BRB’s determination that “subdivision,” as used in § 3(b)
of the LHWCA, 33 U.S.C. § 903(b), includes local municipal
entities is consistent with the language of the statute and the
case law. We uphold the BRB’s determination that the Dis-
trict is a subdivision of the state as reasonable.

The decision of the BRB, denying LHWCA benefits, is

AFFIRMED.