Although LHWCA claims arising from injuries sustained in California fall within the Ninth Circuit Court of Appeals, issues addressed by sister circuits can nonetheless be persuasive. This is especially true when other circuits address issues of first impression.
In Charpentier, the Fifth Circuit Court of Appeals addressed an issue of first impression at the appellate level. Specifically, the Court interpreted the definition of “final decision” as used in Section 921(c) of the LHWCA.
Section 921(c) provides in pertinent part:
Any person adversely affected or aggrieved by a final order of the [Benefits Review] Board may obtain a review of that order in the United States court of appeals for the circuit in which the injury occurred…The payment of the amounts required by an award shall not be stayed pending final decision in any such proceeding unless ordered by the court. No stay shall be issued unless irreparable injury would otherwise ensure to the employer or carrier.
As practitioners under the LHWCA are well aware, a compensation order of the Administrative Law Judge (ALJ) becomes effective when it is filed in the office of the deputy commissioner and payment based thereon is required even if that order is appealed to the Benefits Review Board (BRB) or to the Court of Appeals. 33 U.S. C. §§921(a), 921(b)(3), 921(c). The fact that payments must be made during the appellate process often factors into the employer or carrier’s economic assessment as to whether or not to appeal a compensation order in the first place. This is because an effective mechanism to recoup such payments after a successful appeal does not exist. As such, it is relevant to the LHWCA practitioner to know when payments can be terminated. It was this issue that the Court addressed in Charpentier.
In Charpentier, following the death of her husband, petitioner (hereinafter “widow”) sought and obtained a compensation award for the payment of death benefits from the ALJ. The BRB affirmed the ALJ award and the employer appealed to the Court of Appeals. The Court of Appeals vacated the BRB’s order and remanded the case. The employer immediately ceased paying benefits to the widow on the date the Court of Appeal issued its opinion. The widow filed a petition for writ of certiorari with the Supreme Court which was denied months later.
The issue before the Court of Appeals was the date on which the employer was no longer obligated to pay benefits per Section 921(c). The widow argued that in the absence of any stay order, the employer was required to continue payments until the Supreme Court denied her petition. The employer, on the other hand, argued that once the Court vacated the BRB’s orders, there was no longer any “award” under which payments were due.
As this was an issue of first impression at the appellate level, neither party cited any legal authority for their respective position and both parties relied on what they considered to be a “plain reading” of Section 921(c). According to the Court of Appeal, both parties were incorrect in their interpretation.
In rejecting the widow’s argument, the appellate court noted that Section 921(c) references the “final decision” from the court of appeals. It does not refer to the final resolution of the petitioner’s request for benefits, which may include proceedings before the Supreme Court. On the other hand, the Court also rejected the employer’s argument that there was no longer any “award” requiring payment once the Court issued its opinion vacating the BRB’s order.
Relying in part on authority arising from the Ninth Circuit Court of Appeals (Bryant v. Ford Motor Co. 886 F.2d 1526, 1529 (9th Cir. 1989), it was determined that an appellate court’s decision is not final until its mandate issues. Until the appellate court mandate issues, the Court retained the power to alter or modify its judgment. Thus, the employer was required to continue payments until a stay order issued or until a “final decision” issued, which coincided with the issuance of a mandate nearly two months (51 days) after the opinion vacating the BRB’s order.
As noted above, the opinion of the Fifth Circuit is not binding on cases arising within the Ninth Circuit (covering California), however, it is instructive and persuasive on issues of first impression. Thus, the holding in Charpentier provides useful guidance to employers and carriers when appealing compensation orders under the LHWCA.
The holding in Charpentier is largely favorable to employers and/or carriers. Specifically, if an employer or carrier is successful in overturning a compensation order at the appellate level, the employer or carrier need not continue payment of the underlying compensation order throughout any supplemental proceedings before the Supreme Court. Thus, a worker cannot prolong the payment of benefits by petitioning to the Supreme Court.
Charpentier is also relevant to the extent it provides guidance to avoid a penalty situation based upon a premature termination of benefits. In particular, benefits should not be terminated based upon a favorable appellate opinion until that becomes final, i.e. when the appellate mandate issues.
Although the issue addressed in Charpentier is a narrow one and arises only after a successful appeal, it is relevant to employers and carriers who currently have appeals pending before the circuit courts or who are contemplating the appeal of an ALJ compensation order. This case should be looked to as persuasive authority when the issue of terminating benefits following a successful appeal does arise.