Equitable Equipment Co. v. Director, Office of Worker's Compensation Programs

UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT

No. 98-60640
Summary Calendar

EQUITABLE EQUIPMENT COMPANY,
PART OF TRINITY MARINE GROUP,
A DIVISION OF TRINITY INDUSTRIES, INC.;

Petitioner,

v.

DIRECTOR, OFFICE OF WORKER’S COMPENSATION PROGRAMS,
U.S. DEPARTMENT OF LABOR;
FIDELITY AND CASUALTY COMPANY OF NEW YORK;
AETNA CASUALTY AND SURETY COMPANY; AND,
WAUSAU INSURANCE COMPANIES;

Respondents,

Petition for Review of an Order of the
Benefits Review Board

October 15, 1999

Before HIGGINBOTHAM, JONES, and DENNIS, Circuit Judges.

EDITH H. JONES, Circuit Judge:

This case, initially involving a claim for compensation

under the Longshore and Harbor Workers’ Compensation Act (“LHWCA”),

has evolved into a dispute between Equitable Equipment Company

(“Equitable”) and its former insurers. The Benefits Review Board

(“BRB”) dismissed Equitable’s claim for attorneys’ fees for lack of

jurisdiction. We affirm.

I. FACTUAL AND PROCEDURAL HISTORY

E. Elliot Jourdan died from injuries sustained while

employed, from December 17, 1940, to July 1, 1973, at Equitable’s

Madisonville Shipyard. Jourdan’s wife filed a claim for LHWCA
benefits, and an administrative law judge (“ALJ”) awarded benefits

in a decision and order filed March 22, 1988. Mrs. Jourdan died on

December 18, 1997, and the claim for LHWCA benefits died with her.

The insurance dispute between the parties lives on.

When the original LHWCA claim was asserted, Equitable’s

insurer, Employers Insurance of Wausau (“Wausau”), denied coverage.

In the original benefits decision, the ALJ found that Wausau was not

a responsible carrier, yet failed to make a finding concerning which

former Equitable insurer, if any, was liable for the payment of

Jourdan’s benefits. On petition for modification, Equitable

requested that the ALJ decide Jourdan’s date of exposure to the

asbestos that caused his injuries and determine the insurer

responsible for coverage of those injuries. Aetna Casualty & Surety

Company (“Aetna”) and Fidelity & Casualty Company of New York

(“Fidelity”), both former insurers of Equitable, were joined as

parties to the modification proceedings. On August 16, 1994, an ALJ

found that Aetna was the insurer responsible for payment of the

benefits award. On October 22, 1996, the ALJ’s decision was affirmed

by this court.

Meanwhile, Equitable filed a claim for attorneys’ fees

against Wausau, Aetna, and Fidelity. Equitable grounded its claims

on the LHWCA, 33 U.S.C. § 928(a), and on Louisiana law. The ALJ

dismissed Equitable’s petition for lack of jurisdiction, and the BRB

affirmed. Equitable appeals the BRB’s dismissal.

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 II. ANALYSIS

This court reviews the BRB’s interpretation of the LHWCA,

an issue of law, de novo, affording no special deference to the BRB’s

construction because it is not a policymaking agency. See Wilkerson

v. Ingalls Shipbuilding, Inc., 125 F.3d 904, 906 (1997), citing

Potomac Elec. Power Co. v. Dir., OWCP, 449 U.S. 268, 279 n.18, 101

S.Ct. 509, 515 n.18 (1980).

The LHWCA vests jurisdiction in an ALJ over “a claim for

compensation.” 33 U.S.C. §§ 919(a), 919(d). An ALJ has “full power

and authority to hear and determine all questions in respect of such

claim.” Id. (emphasis added). Equitable argues that its claim for

attorneys’ fees, which resulted from a breach of its insurers’ duty

to defend a compensation claim, is a question “in respect of” a

compensation claim. In Gray & Co., Inc. v. Highlands Ins. Co., 9

BRBS 424, 427-28 (1978), the BRB agreed, permitting an employer to

prosecute a claim for attorneys’ fees against its insurers under §

919(a). When Equitable filed its claim for attorneys’ fees, however,

the BRB overruled Gray and dismissed Equitable’s claim for lack of

jurisdiction. Equitable argues that this dismissal violated BRB

procedural rules and constitutes too narrow an interpretation of §

919(a). Because BRB correctly held that the LHWCA does not provide

for jurisdiction over this claim, we need not address Equitable’s

procedural arguments.

BRB precedent has steadily eroded the foundation of Gray.

In Busby v. Atlantic Dry Dock Corp., the BRB refused to assert

jurisdiction over a claim filed by an insurer for reimbursement of

overpaid benefits from another insurer. See 13 BRBS 222, 224 (1981).

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The BRB noted, “[N]o aspect of any employee’s claim was presented or

decided by the [ALJ],” and the “equitable dispute between the

carriers was therefore . . . not properly before the [ALJ] since this

dispute is not a question in respect to a compensation claim properly

before the [ALJ].” Id. at 225 & n.1 (emphasis added). In Rodman v.

Bethlehem Steel Corp., 16 BRBS 123, 126 (1984), the BRB held that an

ALJ had jurisdiction to resolve a coverage disputed between an

insurer and its insured only to the extent that resolution of the

dispute was “necessary in order to determine compensation liability

in claims under the Act.” Id. at 126. Underpining these cases is

a concern, expressed in Rodman, that the jurisdiction of a non-

article III tribunal like those under the LHWCA workers compensation

statute should be consistent with the post-Gray decision in Northern

Pipeline Const. Co. v. Marathon Pipeline Co., 458 U.S. 50, 102 S.Ct.

2858 (1982).

Gray is inconsistent with the later cases; its

interpretation of § 919(a) stretches an ALJ’s jurisdiction beyond

questions “in respect of” compensation claims. The only issue to be

resolved in Gray was whether an insurer had breached its duty to

defend an employer. See Gray, 9 BRBS at 427-28. Jurisdiction in

Gray, and this case, rests on too thin a reed, however. The

contractual dispute between the insurer and the employer in Gray was

not integral to deciding the compensation claim from which the duty

to defend arose. The ALJ was not called upon to address an

employee’s right to compensation, to determine the carrier

responsible for the payment of benefits, or to resolve a coverage

dispute related to the payment of compensation. As in Gray, the sole

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issue in this case is a state law breach of contract claim between

an insurer and its insured. Such a claim is beyond the

jurisdictional reach of § 919(a), particularly when the underlying

compensation claim has been resolved and no factual dispute regarding

the compensation claim itself must be decided.1

Equitable maintains that its claim is cognizable under 33

U.S.C. § 928(a); however, this argument flies in the face of the

statute. Section 928(a) applies to a “person seeking benefits” that

“utilize[s] the services of an attorney . . . in the successful

prosecution of his claim.” The statute concludes, “[A] reasonable

attorney’s fee against the employer or carrier . . . shall be paid

directly by the employer or carrier to the attorney for the

claimant.” 33 U.S.C. § 928(a). Under § 928(a), an award of

attorneys’ fees is “in addition to the award of compensation.” Id.

Based on the express language of the statute, only a “person seeking

benefits” may assert an attorneys’ fee claim. The statute does not

provide for an award of attorneys’ fees to an employer or carrier.

The BRB has reached a similar conclusion in two cases. See Medrano

v. Bethlehem Steel Corp., 23 BRBS 223, 226 (1990); Mackey v. Marine

Terminals Corp., 21 BRBS 129, 132 (1988).

III. CONCLUSION

The BRB’s decision and order, dismissing Equitable’s claim

for lack of jurisdiction, correctly interpreted the applicable law.

Section 919(a) does not vest jurisdiction in ALJs to decide a

1
Because we agree with the BRB that Gray was improperly decided, we
need not determine whether a three-judge panel of the BRB may overrule a prior
panel or whether en banc consideration by the BRB is required under 20 C.F.R.
§ 801.301(c).

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contract dispute between an employer and its carriers when the cause

of action is wholly unrelated to an underlying claim for

compensation. Equitable’s claim involves neither a determination of

which carrier must pay compensation benefits nor a dispute over

potential coverage of a benefits claim. Accordingly, the ALJ lacked

jurisdiction to adjudicate Equitable’s claim for attorneys’ fees.

Likewise, § 928(a) does not confer a federal cause of action on an

employer for the prosecution of, or vest jurisdiction in ALJs to

resolve, an attorneys’ fees claim of this nature.

AFFIRMED.

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