Admiralty Coatings Corporation v. William B. Emery

PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
ADMIRALTY COATINGS CORPORATION,
Petitioner,
v.
WILLIAM B. EMERY; DIRECTOR,
No. 97-2639
OFFICE OF WORKERS' COMPENSATION
PROGRAMS, UNITED STATES
DEPARTMENT OF LABOR,
Respondents.
On Petition for Review of an Order of the
Benefits Review Board.
(97-0481)
Argued: May 1, 2000
Decided: September 21, 2000
Before WIDENER, NIEMEYER, and KING, Circuit Judges.
_________________________________________________________________
Petition for review denied by published opinion. Judge King wrote
the opinion, in which Judge Widener and Judge Niemeyer joined.
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COUNSEL
ARGUED: F. Nash Bilisoly, IV, VANDEVENTER BLACK, L.L.P.,
Norfolk, Virginia, for Petitioner. Elizabeth Hopkins, UNITED
STATES DEPARTMENT OF LABOR, Washington, D.C.; Ralph
Rabinowitz, RABINOWITZ, RAFAL, SWARTZ, TALIAFERRO &
GILBERT, P.C., Norfolk, Virginia, for Respondents. ON BRIEF:

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Kelly Outten Stokes, VANDEVENTER BLACK, L.L.P., Norfolk,
Virginia, for Petitioner. Marvin Krislov, Deputy Solicitor for National
Operations, Allen H. Feldman, Associate Solicitor for Special Appel-
late and Supreme Court Litigation, UNITED STATES DEPART-
MENT OF LABOR, Washington, D.C., for Respondent Director.
_________________________________________________________________
OPINION
KING, Circuit Judge:
Admiralty Coatings Corporation petitions for review of the Deci-
sion and Order of the Benefits Review Board ("BRB") awarding to
William B. Emery, on a continuing basis, temporary partial disability
benefits under the Longshore and Harbor Workers' Compensation
Act ("LHWCA") for a shoulder injury sustained in the course of
Emery's employment. For the reasons expressed below, we deny the
petition for review and affirm the award of benefits.
I.
On November 18, 1994, Emery was hurt while sandblasting inside
a ship; a sudden increase in the air pressure delivered to the blaster
hose caused the apparatus to jerk, partially tearing the supraspinatus
tendon in Emery's right shoulder. Although Admiralty Coatings ini-
tially controverted its liability for this injury, it belatedly paid Emery
temporary total disability benefits for the period November 23, 1994,
through January 4, 1995. On this latter date, with no paycheck and no
benefits yet forthcoming, Emery visited his treating orthopedist, Dr.
Jack L. Siegel, seeking permission to return to work. Dr. Siegel duti-
fully examined Emery and granted his request.
Despite Dr. Siegel's authorization, Emery felt as though he could
not resume work as a sandblaster, which is extremely heavy and phys-
ically demanding labor. Although the treatment regimen had
improved his condition and most of the pain had subsided, Emery had
not yet regained full strength in his shoulder, and he was concerned
about the possibility of reinjury.
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With return to his old job thus precluded, Emery accepted work as
a spray painter with Main Industries on February 8, 1995. During his
four-month tenure with Main, Emery saw Dr. Siegel on three occa-
sions. On March 21, 1995, Emery reported only light, infrequent pain,
for which medication was unnecessary. He continued, however, to
lack strength in his right shoulder, most notably when his arm was
fully extended.
Within two weeks, the situation had changed. At Emery's next
visit, on April 4, 1995, he complained of pain and discomfort in his
shoulder. According to Dr. Siegel's report, Emery felt that his symp-
toms were "related to a strain recently at work trying to lift a can of
paint in an overhead and forward position." J.A. 135.1 Dr. Siegel
noted "[e]xacerbation of right shoulder symptoms with mild bursitis
and strain component." Id. Dr. Siegel administered an injection of
painkillers which "helped tremendously," though Emery continued to
report mild discomfort during his next visit, about six weeks later.
Emery was terminated from his painting job on June 1, 1995, after
a confrontation with a co-worker. He was subsequently employed by
JEMM Industries, Inc., from June 20, 1995, until October 26, 1995,
when he was again dismissed. Toward the end of Emery's employ-
ment with JEMM, Dr. Siegel recommended that Emery undergo sur-
gery to repair his shoulder. Although Emery worked about three
weeks in April 1996 for yet another employer, he quit that job in
anticipation of the surgery, which apparently has yet to occur because
of the uncertainty as to whether and how the hospital will be paid.
Admiralty Coatings contested Emery's claim that he was entitled
to medical and wage compensation beyond the six weeks of benefits
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1 At his deposition, Dr. Siegel explained that Emery had actually
described three to five activities, including the lifting of the paint can,
that had caused him pain on the job. Dr. Siegel more or less acknowl-
edged that his report could be construed as documenting a single, trau-
matic incident causing a specific injury, but that such was not his intent.
The report, Dr. Siegel said, had been transcribed from a tape recording,
and he chose to relate the paint can incident as"the one issue that was
most descriptive for me to include in a dictation." J.A. 95. The ALJ cred-
ited Dr. Siegel's testimony clarifying his position.
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paid on account of his temporary total disability, and the matter came
on for hearing before an ALJ on May 29, 1996. By Decision and
Order of November 4, 1996, the ALJ found Emery's shoulder prob-
lems to be the result of his employment with Admiralty Coatings, and
he directed the employer to provide "any and all medical treatment
and/or surgery needed for [Emery's] right shoulder." J.A. 212.2 The
BRB affirmed the ALJ's ruling on October 23, 1997. On November
26, 1997, Admiralty Coatings timely petitioned for our review.
II.
A.
Admiralty Coatings challenges the ALJ's authority to award tem-
porary benefits beyond the date of the May 29, 1996 evidentiary hear-
ing, contending that such a practice violates the mandate of the
Administrative Procedure Act that all findings and conclusions be
supported by the record evidence. See 5 U.S.C. § 557(c)(3) ("All deci-
sions . . . shall include a statement of (A) findings and conclusions,
and the reasons or basis therefor, on all the material issues of fact,
law, or discretion presented on the record . . . ."). According to Admi-
ralty Coatings, there is simply "no evidence" of Emery's disability
having continued beyond the date of the hearing, and thus no basis to
compel the ongoing payment of benefits.
We discern no merit in this argument. If the rationale urged by
Admiralty Coatings were to prevail generally, the courts could never,
for example, grant injunctive relief prospectively, because there
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2 The ALJ also concluded that Emery had suffered a lingering tempo-
rary partial disability, but he rejected Emery's claims of a seriously
impaired earning capacity. The ALJ found that Emery had simply chosen
not to work during his periods of inactivity, and that his earning capacity
was best illustrated by his employment with JEMM, during which he had
earned $600 per week. Because Emery's average weekly wage as a sand-
blaster was $668.08, the ALJ found him entitled to a weekly benefit pay-
ment of only $45.39, representing two-thirds of the difference. See 33
U.S.C. § 908(e) (setting compensation rate). The ALJ determined
Emery's eligibility for benefits to have commenced on October 26, 1995,
and to have not terminated as of the November 4, 1996 order.
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would be "no evidence" today that the actions complained of would
continue tomorrow. Likewise, courts would be precluded from award-
ing damages to injured plaintiffs for their future medical expenses,
simply because these expenses had yet to be actually realized.
Courts, of course, issue injunctions and award future damages with
some frequency, based on nothing more than evidence of the status
quo and extrapolations that may be made therefrom. Indeed, princi-
ples of fairness, finality, and judicial economy dictate no higher
threshold. Very few things can be known with absolute certitude;
thus, we deal in the law -- as in life -- with probabilities, not certain-
ties. That Emery's shoulder keeps him today from being a sandblaster
is a pretty fair indication that, absent the sudden appearance in town
of a tent revival, he will not be seeking work as a sandblaster tomor-
row. It is not required that Emery appear before the ALJ each week,
hat in hand, as a condition of receiving his benefit check.
Moreover, the LHWCA specifically authorizes continuing awards
in situations such as Emery's. See 33 U.S.C.§ 908(e) ("In case of
temporary partial disability resulting in decrease of earning capacity
the compensation . . . [is] to be paid during the continuance of such
disability, but shall not be paid for a period exceeding five years.").
A temporary award may terminate sooner than five years upon a
showing that the condition giving rise to the disability has reached its
"maximum medical improvement"; at that point, if the "improvement"
is less than full recovery, the claimant may receive a permanent dis-
ability award. See Gilchrist v. Newport News Shipbuilding & Dry
Dock Co., 135 F.3d 915, 917 (4th Cir. 1998).
If, prior to the expiration of the five-year maximum, Admiralty
Coatings believes that Emery has regained his pre-injury earning
capacity (by, for example, returning to longshore work or obtaining
another job with similar pay), or has otherwise reached his maximum
medical improvement, it may move under 33 U.S.C.§ 922 for a mod-
ification of the initial award. Admiralty Coatings maintains, however,
that relief under § 922 is inadequate, because the statute forbids it
from recouping any overpayments that may have occurred between
the date that maximum medical improvement is reached and the date
of the modification decision.3 This potential "lag time," Admiralty
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3 In the event that an employer would be liable for further benefits
beyond the modification date, § 922 does permit it to deduct past over-
payments from future benefits due.
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Coatings argues, results in the abridgement of its due process right to
a hearing prior to being deprived of its property.
To the contrary, the initial hearing before the ALJ and the subse-
quent appeals (to the BRB and this court) provided Admiralty Coat-
ings with all the process that it is constitutionally due. The
administrative claim procedure and the statutory scheme itself
afforded Admiralty Coatings with ample notice of (1) Emery's asser-
tion that his injury was ongoing; and (2) the prospect of continuing
payments should the injury be determined to have arisen from the
company's employment of Emery. Admiralty Coatings was thus
given a full opportunity to controvert its liability and contest, if it
could, the ongoing nature of Emery's injury. The potential collateral
consequences of the company's failure to convince the factfinder of
the merits of its case do not amount to a constitutional violation.
B.
With doubt cast aside as to the constitutionality of the administra-
tive process, the substantive question for our consideration is simply
whether Emery's current shoulder condition was caused by the
November 18, 1994 sandblasting incident, at which time he was
employed by Admiralty Coatings. If so, then Admiralty Coatings is
responsible for the costs of Emery's medical treatment and the award
of temporary partial benefits. Admiralty Coatings denies causation,
asserting that Emery's condition is instead the result of his work as
a painter for Main Industries.
Admiralty Coatings maintains that the "aggravation rule" immu-
nizes it from liability in this case. See Director, OWCP v. Newport
News Shipbuilding & Dry Dock Co., 138 F.3d 134, 138 (4th Cir.
1998) ("Under the LHWCA's `aggravation rule,' if an injury at work
aggravates an employee's pre-existing disability, the employer is lia-
ble for the employee's entire resulting disability, not only the disabil-
ity that would have been due to the work-related injury alone."). The
rule is usually applied on behalf of claimants for the purpose of hold-
ing their current employer liable for benefits; in this case, however,
Admiralty Coatings attempts to invoke the rule as a shield, arguing
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that Main Industries (against which Emery has filed no claim) is
responsible for the compensation award.4
The ALJ ruled that Emery's current back problems were the natural
progression of his initial injury, and that his employment with Main
did not give rise to a supervening cause that would break the chain
of relatedness between Emery's employment with Admiralty Coat-
ings and his required surgery:
Employer argues that there was a work-related aggravation
of Claimant's shoulder injury after he returned as a painter
in January 1995. I do not agree. The evidence shows that
Claimant suffered a work-related injury to his right shoulder
on November 18, 1994. All the physicians of record agree
that he partially tore a rotator cuff tendon. Moreover, the
physicians agree that the tear never completely healed.
J.A. 211. The "physicians of record" were Dr. Siegel and Dr. Robert
S. Neff (also an orthopedic surgeon), the latter of whom examined
Emery on February 20, 1996.
In response to counsel's questioning at deposition, Dr. Siegel testi-
fied that
there's probably a small component here of aggravation
from the repetitive phenomena [i.e., the back-and-forth arm
motion required of a spray painter] . . . but I would still --
the majority of the -- of the cause, from a scientific stand-
point . . . it's the underlying etiology of the shoulder prob-
lem which was present from the time of his first injury. . . .
My feelings on the recurrence of his pain is based on the
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4 The Director takes the position that we should reject, as a matter of
law, the "defensive" use of the aggravation rule attempted in this case.
See Br. of Dir. at 12-15. We note, however, that the Ninth Circuit has
sanctioned the approach taken here by Admiralty Coatings. See Kelaita
v. Director, OWCP, 799 F.2d 1308, 1310 (9th Cir. 1986). Because we
hold the ALJ's award of benefits to have been supported by substantial
evidence in any event, we leave for another day the question of whether
an employer may avail itself of the "aggravation rule defense."
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fact that this is a progression of the original underlying etiol-
ogy of his shoulder pain and that the symptoms that he
reported to me after finding a new position is not a reinjury
or a new trauma.
J.A. 107-08. Dr. Siegel's testimony reiterated the position he had
taken a few weeks earlier in a letter to counsel for Admiralty Coat-
ings:
To the best of my knowledge, Mr. Emery's present dysfunc-
tion, disability and pathology are related to his initial injury,
and the disability after April 1995 is from the natural pro-
gression of the original work-related injury. Perhaps the
wording in my note is a bit misleading [see supra note 1],
but there is no question in my mind that all of this is a result
from his initial problem and could have easily occurred
without any "reaggravation, reinjury or new trauma."
J.A. 152.
Dr. Neff's evaluation was, in several respects, not inconsistent with
that of Dr. Siegel. Neff opined that
had [Emery] gone back to work either as a sandblaster or as
a painter, he would have continued right shoulder problems
and the activities which he performed upon returning to his
new job in January 1995 were responsible to some degree
for his worsening of his right shoulder symptoms. Stated
another way, had he not returned to any work activity but
simply kept his arm by his side and performed any active
significant use of the right upper extremity, he would proba-
bly not be having the symptoms which he is having at this
time. His initial problem never, in my opinion, completely
healed and the increased activity which resulted from him
returning to a work environment in January 1995 caused his
symptoms to recur and his right shoulder problem to be
worse as a result of that employment than it was prior to
returning to work.
J.A. 202. Contrary to the position taken by Dr. Siegel, however, Neff
determined that Emery's "current condition is not the natural progres-
sion of his initial work injury absent the second job but is a result of
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the initial work injury plus the second job." J.A. 203. With regard to
the above conclusion, the ALJ observed:
Dr. Neff's reasoning escapes me. He does not explain how
a limb which he feels has been rendered useless for working
purposes by the first injury can somehow be rendered more
useless for working purposes later. Rather, I find that the
weight of the credible medical evidence as shown by Dr.
Siegel's opinions and testimony compels a conclusion that
Claimant's right shoulder disability results from the natural
progression of Claimant's November 1994 injury, notwith-
standing Claimant's subsequent symptoms of shoulder pain
and weakness while working later as a painter.
J.A. 212.
The ALJ's analysis was on target. The "aggravation rule" might
apply, if at all, to a situation where a second trauma occurs in an area
first injured during the claimant's prior employment, but since healed
to the extent possible. In that instance, the subsequent employer is
justifiably responsible for the entire resultant injury, even if the con-
sequences of that injury are made worse by virtue of the area having
been previously weakened or otherwise adversely affected.
Here, however, as Dr. Siegel opined and the ALJ found, there was
no "second trauma"; instead, there was simply an onset of complica-
tions from the first trauma. Admiralty Coatings may be chagrined
about Dr. Siegel's failure to successfully treat Emery's condition at
the outset, but it appropriately bears the risk of that eventuality. The
ALJ's award of benefits is therefore supported by substantial evi-
dence.
III.
In accordance with the foregoing, we deny the petition for review
and affirm the benefit award.
PETITION FOR REVIEW DENIED
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