Alan J. Vogan v. Eric K. Shinseki ( 2010 )

UNITED STATES COURT OF APPEALS FOR VETERANS CLAIMS
NO . 09-0049
ALAN J. VOGAN , APPELLANT ,
v.
ERIC K. SHINSEKI,
SECRETARY OF VETERANS AFFAIRS, APPELLEE.
On Appeal from the Board of Veterans' Appeals
(Decided November 15, 2010)
Theodore C. Jarvi, of Tempe, Arizona, was on the brief for the appellant.
Will A. Gunn, General Counsel; R. Randall Campbell, Assistant General Counsel; Kenneth
A Walsh, Deputy Assistant General Counsel; and Jessica M. Schwartz, Appellate Attorney, all of
Washington, D.C., were on the brief for the appellee.
Before HAGEL, MOORMAN, and DAVIS, Judges.
DAVIS, Judge: U.S. Marine Corps veteran Alan J. Vogan appeals through counsel from a
September 23, 2008, Board of Veterans' Appeals (Board) decision that denied an increased rating
for postoperative residuals of gynecomastia1 in both breasts. For the following reasons, the Court
will affirm the Board's September 2008 decision.
The appellant had active service from December 1998 to September 2001. Possibly as a
result of losing a large amount of weight in order to enlist in the Marine Corps, he experienced
gynecomastia in service. Therefore, in 1999, he underwent a bilateral mastectomy and two more
subsequent surgeries to perform cosmetic repairs on the scars remaining from the original surgery.
1
"Gynecomastia" is "[e]xcessive growth of the male mammary glands; transitory enlargement of the male breast
developing during rehabilitation and recovery from a state of malnutrition or starvation." D O RLAN D 'S I LLU STRATED
M ED ICAL D ICTION ARY 824 (31st ed. 2007).
In a January 2003 rating decision he received service connection for his scars, each rated as 10%
disabling, effective the date of his separation from service. These ratings were reduced to 0% for
a time, but a 2006 Board decision found the reduction to be in error and restored the 10% ratings.
In the decision here on appeal, the Board denied disability ratings in excess of 10%. The Board's
analysis was based solely on the diagnostic codes (DCs) for scars.
The appellant presents three arguments for consideration by the Court. He argues first that
both the regional office (RO) and the Board approached his disability rating with "tunnel vision"
focused on scars, ignoring other DCs that potentially offered higher ratings in view of all of his
symptoms. He further argues that he presented new evidence after a previous remand, which the
Board considered without remanding to the regional office (RO), thereby depriving him of his
statutory right to one review on appeal to the Secretary. See 38 U.S.C. § 7104(a); Disabled Am.
Veterans v. Sec'y of Veterans Affairs, 327 F.3d 1339 (Fed. Cir. 2003). Finally, the appellant argues
that the Board's statement of reasons or bases was inadequate for failure to consider evidence
favorable to his claim.
I. ANALYSIS
The Board's selection of the applicable diagnostic code may be set aside "only if such
selection is 'arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.'"
Butts v. Brown, 5 Vet.App. 532, 539 (1993) (en banc) (quoting 38 U.S.C. § 7261(a)(3)(A)). A
decision of the Board must include a written statement of the reasons or bases for the findings and
conclusions on all material issues of fact and law presented on the record. See 38 U.S.C.
§ 7104(d)(1). The statement must identify the findings that the Board deems crucial to its decision,
account for the evidence it finds persuasive or unpersuasive, and be adequate to allow the claimant
to understand the precise basis for the decision and facilitate review in this Court. Davis v. Principi,
17 Vet.App. 54, 57 (2003); Allday v. Brown, 7 Vet.App. 517, 527 (1995).
A. Selection of Appropriate Diagnostic Code
The appellant has consistently argued that the residuals of his bilateral mastectomy include
a wider range of symptoms than is addressed by the application of the DCs for scars. He further
argues that the examination requests from the RO inappropriately limited the scope of the
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examinations by focusing solely on the DCs for scars. He points to lay and medical evidence of
disfigurement, adhesions, hypopigmentation, discharge, pain, and tenderness associated with the
bilateral breast surgeries. The appellant does not suggest specific DCs that the Board should have
considered in connection with these symptoms. Instead, he submits an appendix listing every DC
that mentions "adhesions," including adhesions of the intestine and uterus, as well as DCs that have
some connection to the breasts. With one exception, discussed below, none of the DCs listed in the
appellant's appendix have any apparent application to rating the residuals of surgery for
gynecomastia.2
VA may undertake rating by analogy where the disability in question is analogous in terms
of the functions affected, the anatomical localization, and the symptomatologies of the ailments. See
Lendenman v. Principi, 3 Vet.App. 349, 351 (1992); 38 C.F.R. § 4.20 (2010). In this case, however,
the appellant has not set forth any argument or explanation of how any other DC would apply to the
residuals of his surgery beyond scars. His implicit suggestion that there ought to be a DC that would
apply to his symptoms falls under the heading of "conjectural analogies." See 38 C.F.R. § 4.20("Conjectural analogies will be avoided.").
The appellant does reference one DC that requires further discussion. This DC pertains to
"breast, surgery of." See 38 C.F.R. § 4.116, DC 7626 (2010). The appellant identified this DC "as
a likely code for application if examiners were allowed to consider the symptoms associated with
it." Appellant's Reply Brief (Br.) at 1. Although the provisions of this DC are primarily directed to
surgical procedures undertaken because of breast cancer, they appear to also have some applicability
to the appellant's surgical procedure. In fact, as discussed below, under this DC, a noncompensable
rating is warranted for criteria that are arguably met in this case based on the undisputed facts. "The
Secretary recognizes that the Board, arguably, should have addressed this DC in relation to
Appellant's claim." Secretary's Br. at 13. The Court concludes that the Board erred in not
considering DC 7626 in its discussion, and therefore the Board's statement of reasons or bases for
denying a disability rating higher than 10% was inadequate. See Schrafath v. Derwinski, 1 Vet.App.
2The DCs mentioning adhesions focus on interference either with the digestive process, the heart, or the female
reproductive system; there is no factual basis in this case for applying any of these rating codes. The only DC that
provides a potentially higher disability rating for scars does so on the basis of limitation of motion and require that the
scars have more surface area than the appellant's scars.
3
589, 593 (1991) (decisions of the Board shall be based on all applicable provisions of law and
regulation).
Ordinarily, the Court's inquiry would end here, with directions for the Board to consider DC
7626 on remand, as this Court has made clear that "VA and the [Board] possess specialized expertise
in identifying and assessing the medical nature of a claimed condition." Butts v. Brown, 5 Vet.App.
532, 539 (1993) (en banc). However, as discussed below, in this case, the facts are so clear when
examined in light of the specific and limited criteria of the DC for "breast, surgery of," that the
Court concludes that a remand is not required. See Valiao v. Principi, 17 Vet.App. 229, 232 (2003)
(holding that "[w]here the facts averred by a claimant cannot conceivably result in any disposition
of the appeal other than affirmance of the Board decision, the case should not be remanded for
development that could not possibly change the outcome of the decision").
B. Prejudicial Error Analysis
The Court must proceed to determine whether this error prejudiced the appellant. See
38 U.S.C. § 7261(b)(2) (stating that the Court shall take due account of the rule of prejudicial error);
Newhouse v. Nicholson, 497 F.3d 1298, 1301 (Fed. Cir. 2007); Conway v. Principi, 353 F.3d 1369,
1374-75 (Fed. Cir. 2004). At the outset, there is a question as to the permissible scope of review in
conducting a harmless error analysis. The Secretary argues that the Court may "go outside of the
facts as found by the Board to determine whether an error was prejudicial by reviewing 'the record
of proceedings before the Secretary and the Board.'" Mlechick v. Mansfield, 503 F.3d 1340, 1345
(Fed. Cir. 2007) (quoting Newhouse, 497 F.3d at 1302). The appellant counters that these cited cases
allow the Court such latitude only in the context of considering errors in complying with the notice
requirements of the Veterans Claims Assistance Act of 2000 (VCAA), Pub. L. No. 106-475, § 3(a),
114 Stat. 2096 (codified in part at 38 U.S.C. § 5103(a)).
1. The Law of Prejudicial Error
The appellant's position derives from a doctrine set forth by the U.S. Supreme Court
concerning the basis of review of agency decisions:
[In a previous ruling in the case], we emphasized a simple but fundamental rule of
administrative law. That rule is to the effect that a reviewing court, in dealing with
a determination or judgment which an administrative agency alone is authorized to
make, must judge the propriety of such action solely by the grounds invoked by the
agency. If those grounds are inadequate or improper, the court is powerless to
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affirm the administrative action by substituting what it considers to be a more
adequate or proper basis. To do so would propel the court into the domain which
Congress has set aside exclusively for the administrative agency.
Sec. & Exchange Comm'n v. Chenery Corp., 332 U.S. 194, 196 (1947) (emphasis added); but see
Newhouse, 497 F.3d at 1301 ("the Chenery doctrine is not implicated when the new ground of
affirmance 'is not one that calls for "a determination or judgment which an administrative agency
alone is authorized to make.'") (quoting Fleshman v. West, 138 F.3d 1429, 1433 (Fed. Cir. 1998)).
In a previous opinion, the Supreme Court overturned an order of the Commission concerning
management ownership of preferred stock during a reorganization of a public utility holding
company. The Commission stated that it was merely applying the broad equitable principles of
established common law. The Supreme Court overturned the Commission's order, finding that the
case precedent cited by the Commission did not forbid what the management of the holding company
proposed to do. Rejecting arguments that the order should be upheld as otherwise within the powers
of the Commission, the holding of the case was that "an administrative order cannot be upheld unless
the grounds upon which the agency acted in exercising its powers were those upon which its action
can be sustained." Sec. & Exchange Comm'n v. Chenery Corp., 318 U.S. 80, 196 (1943) (emphasis
added). On remand, the Commission proffered a new order, premised on its expertise and
experience; the Supreme Court upheld the order on these grounds. See Chenery Corp., 332 U.S. at
209. These cases stand for the proposition that the correctness of an action of an agency must be
judged only on the grounds advanced by the agency.
The U.S. Court of Appeals for the Federal Circuit (Federal Circuit) has applied this doctrine
in veterans benefits cases. See Mayfield v. Nicholson, 444 F.3d 1328, 1334 (Fed. Cir. 2006) (holding
that this Court's decision sustaining Board determination of sufficient VCAA notice "violate[d] the
longstanding principle of law that a court reviewing an agency decision generally may not sustain
the agency's ruling on a ground different from that invoked by the agency") (emphasis added).
In conducting a prejudicial error analysis, however, the Court is not reviewing a Board
determination to assess whether it should be sustained on the grounds advanced by the Board. The
Court has already determined that an error has been made. Rather, the Court is applying a statutory
mandate to consider whether an error "affects a substantial right so as to injure an interest that the
statutory or regulatory provision involved was designed to protect such that the error affects 'the
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essential fairness of the [adjudication].'" Mayfield v. Nicholson, 19 Vet.App. 103, 116 (2005)
(quoting McDonough Power Equip., Inc. v. Greenwood, 464 U.S. 548, 553-54 (1984)), rev'd in part
by Mayfield v. Nicholson, 444 F.3d 1328 (Fed. Cir. 2006).3 Additionally, the Court in Mayfield
stated that "a demonstration by one party that an error did not affect the outcome of a case would
establish that there was or could be no prejudice." Id. at 120. It is important to note that the
foregoing principles of prejudicial error analysis were all set forth in the 2005 Mayfield decision
before this Court ever took up the application of these principles in the context of a VCAA notice
error.
"[T]he direction to us in [38 U.S.C. §] 7261(b)(2) to 'take due account' of the rule [of
prejudicial error] leaves us with considerable latitude as to how to 'take due account.'" Mayfield, 19
Vet.App. at 114 (quoting section 7261(b)(2)). The wording of the statute itself places no limitations
on the scope of the Court's inquiry regarding prejudicial error. The U.S. Supreme Court has stated
that "the statute, in stating that [this Court] must 'take due account of the rule of prejudicial error,'
requires [this Court] to apply the same kind of 'harmless error' rule that courts ordinarily apply in
civil cases." Shinseki v. Sanders, 129 S. Ct. 1696, 1704 (2009) (quoting 38 U.S.C. § 7261(b)(2)).
The Federal Circuit recognized that the statutory obligation to take due account of the rule
of prejudicial error "permits the Veterans Court to go outside of the facts as found by the Board to
determine whether an error was prejudicial by reviewing 'the record of the proceedings before the
Secretary and the Board.'" Mlechick, 503 F.3d at 1345 (quoting Newhouse, 497 F.3d at 1302).
Furthermore, the Federal Circuit stated that "the principles announced by the Supreme Court in
[Chenery] are not violated when the Veterans Court makes a determination regarding prejudicial
error in the first instance solely because Congress has specifically required that court to do so by
statute." Id. These cases recognize that Congress removed consideration of the administrative
record in a prejudicial error analysis from the domain of matters that are committed exclusively to
the administrative agency. See Newhouse, 497 F.3d at 1301 ("the Veterans Court was required to
3
This Court's decision in Mayfield was overruled by the Federal Circuit based on Chenery to the extent that this
Court relied on documents not relied on by the Board in affirming the Board's finding that VA had satisfied its duty to
notify. Mayfield, 444 F.3d at 1334. The Federal Circuit's decision in Mayfield, however, did not disturb this Court's
discussion of the definition of "prejudicial error."
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examine whether any errors by VA were prejudicial and [] it must do so based on the administrative
record.").
The reason behind these holdings is obvious. The Board cannot predict every instance in
which it might be found to have committed error. If it could, presumably, it would never err.
Therefore, the Board cannot be expected to make specific factual findings that might facilitate a
prejudicial error analysis. If the Court's review were restricted to findings made by the Board, the
usefulness of Congress's direction that we examine an error for prejudice would be marginalized as
a tool for avoidance of remands that entail no realistic prospect of an outcome more favorable to a
veteran. Indeed, the Court has previously recognized that it is the Court's responsibility to apply the
rule of prejudicial error, not the Board's. See Medrano v. Nicholson, 21 Vet.App. 165, 171 (2007)
("Deferring to any Board determinations in the context of prejudicial error would be tantamount to
ceding the authority that Congress has vested in this Court; reassignment of the Court's statutory
obligation is something we are not inclined, nor authorized, to do."). That all the cases cited above
are VCAA notice cases is a distinction without a difference. The underlying imperative of all of
these cases is that prejudice should be analyzed from the standpoint of the interest protected by the
statutory or regulatory provision involved, to determine whether an error affected the essential
fairness of the adjudication. This Court and the Federal Circuit simply applied that methodology to
the statute and implementing regulations having to do with VCAA notice, as it would apply them
to any other statutory and regulatory provisions.
Given the statutory duty to consider prejudicial error in all cases, and finding no reasoning
in Mlechick or Newhouse that is unique to the notice-error context, the Court is not persuaded by the
appellant's argument. The Court therefore holds that in assessing the prejudicial effect of any error
of law or fact, the Court is not confined to the findings of the Board but may examine the entire
record before the Agency, which includes the record of proceedings. See U.S. VET . APP . R. 10,
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28.1.4 The Court will therefore proceed to examine the question of prejudicial error in this case
employing the full scope of the record in its consideration.
2. Application of Law to this Case
The purpose of the rating schedule is to evaluate "disability resulting from all types of
diseases and injuries encountered as a result of or incident to military service." 38 C.F.R. § 4.1(2010) (emphasis added). "[I]t is the obligation of VA . . . to render a decision which grants every
benefit that can be supported in law . . . ." 38 C.F.R. § 3.103 (2010). Thus, the appellant will have
established prejudice if he shows that the Board failed to consider any DC under which he potentially
may be entitled to additional benefits. The Court will examine the potential prejudice resulting from
the Board's failure to consider DC 7626 in that light.
DC 7626 provides for progressively higher disability ratings for residuals of breast surgery
according to whether the claimant has undergone a "wide local excision," a "simple mastectomy,"
a "modified radical mastectomy, " or a "radical mastectomy." 38 C.F.R. § 4.116, DC 7626 (2010).
A radical or a modified radical mastectomy involves the removal of lymph nodes in addition to
removal of breast tissue. Id. at Notes (1) and (2). The Secretary correctly asserts there is no
evidence of record that the appellant's mastectomy included removal of lymph nodes. Thus, the
ratings for radical mastectomy and modified radical mastectomy are inapplicable. A simple
mastectomy involves the removal of all breast tissue, including the nipples, but leaving the lymph
nodes and pectoral muscles intact. Id. at Note (3). The Secretary correctly notes that the evidence
of record excludes the possibility that the appellant underwent a simple mastectomy. See Record
(R.) at 259 ("He also reports having increased sensitivity of the nipples.").
It is clear, however, that the appellant has undergone a "wide local excision," which the DC
defines as "removal of a portion of the breast tissue." DC 7626 at Note (4). He would be entitled
to a compensatory rating under DC 7626 only if the wide local excision produced "significant
alteration of size or form" of one breast (30%) or both breasts (50%). 38 C.F.R. § 4.116, DC 7626.
4
Although the Court may, in its discretion, direct the filing of additional record material, its review will typically
be confined to the record of proceedings (ROP). See U.S. V ET . A PP . R. 28.1. Therefore, the party with the burden of
proof as to prejudice, typically the appellant, see Shinseki,129 S. Ct. at 1705-06, should take care to make sure that any
portions of the record pertaining to a showing of prejudice, or lack thereof, are cited in the briefing, thereby assuring that
they will be included in the ROP.
8
While the surgery for gynecomastia was specifically undertaken to reduce abnormally enlarged male
breasts, such a reduction does not constitute a compensable injury under the DC. Rather, the very
purpose of the surgery, to which the appellant agreed, was to return the appellant's breasts to the size
and form that is normal for males. Cf. Nielson v. Shinseki, 23 Vet.App. 56, 61 (2009) (finding that
the anticipated and desired outcome of the in-service removal of teeth as a result of periodontal
disease cannot constitute a compensable injury).
The appellant complains of "disfigurement," with some supporting citations to medical
evidence of record.5 It is not at all clear what the medical examiners, one of whom was a specialist
in internal medicine, and another an M.D. performing a psychiatric examination, may have meant
with references to "disfiguring scars." Another medical examiner, while noting that "the information
is obtained from the veteran," lists "tissue removed from chest/deformed due to surgery" in the
medical history section of the report. R. at 936-37. Later, upon examination, the report reads as
follows: "he has two scars under each breast, about 4 cm each, white in color, slightly depressed."
R. at 938. The meaning of the word "disfigure" is: "To mar or spoil the appearance or shape of."
WEBSTER 'S II NEW COLLEGE DICTIONARY 326 (3d ed. 2001). The Court notes that any visible scar
mars the appearance of the area on which it exists.
In any view of the matter, the Secretary is correct that these medical reports furnish no
evidence that the appellant's 4 cm. scars altered the size or form of the appellant's male breasts such
that they are abnormal in any way. One examiner noted that "[t]here is no significant breast
asymmetry, but there is mild skin retraction of the right upper breast, due to surgery." R. at 741. In
another examination report, the appellant was said to have "mild underlying tissue loss of the outer
superior quadrant of the right breast and the inner superior quadrant of the left breast." R. at 262.
This tissue loss is precisely the goal of the original surgery. Thus, there is no evidence on which the
Board could find "significant alteration of the size or form" that might furnish a basis for a
compensable disability rating under DC 7626.
5
He asserts that "[d]isfigurement is a significant element of skin ratings under [DC] 7800." Appellant's Br. at
16. This DC, however, pertains to facial, head, or neck disfigurement and does not constitute a general DC for scars
anywhere on the body. W e nevertheless consider the appellant's cited medical evidence in our discussion of DC 7626.
9
Therefore, the appellant's surgical residuals would be classified as "wide local excision
without significant alteration of size or form." DC 7626 (emphasis added). DC 7626 provides a
noncompensable rating for such classification. The appellant, however, is receiving a 10% disability
rating for each of his scars as residuals of gynecomastia. Accordingly, he would obtain no additional
disability rating beyond that which he already has under the rating for scars.
The remaining symptoms of which the appellant complains–adhesions, hypopigmentation,
discharge, pain, and tenderness–are simply not pertinent to DC 7626 and would not enter into an
analysis regarding the criteria for DC 7626. Thus, even if the Board had applied DC 7626, there is
no basis on which the appellant would have been entitled to a compensable disability rating for
breast surgery. The Court therefore concludes that neither the appellant nor the record demonstrates
prejudice from the Board's failure to apply DC 7626. See Soyini v. Derwinski, 1 Vet.App. 540, 546
(1991) (Court will not strictly adhere to reasons-and-bases requirement when such adherence "would
result in . . . unnecessarily imposing additional burdens on [the Board] with no benefit flowing to
the veteran").
As noted above, the appellant has suggested no other DC under which his additional
symptoms might lead to an increased rating, either directly or by analogy. He states that he made
a conscious choice to refrain from identifying any additional DCs because the VA examinations did
not furnish evidence pertaining to other DCs. Appellant's Reply Br. at 1. As shown in the foregoing
discussion, however, the evidence of record is sufficient to evaluate the potential application of DC
7626. Moreover, the Board stated that both the 2004 and 2005 VA examinations noted "no evidence
of adherence, disfigurement, ulceration, instability, keloid, . . . abnormal texture, or limitation of
motion." R. at 27, 28. The Court's review confirms the Board's account of the evidence. The record,
therefore, does not sustain the appellant's contention that the examiners' focus on evidence pertaining
to scars prevented him from evaluating the potential applicability of other DCs.
In sum, the Board's error in failing to discuss potentially relevant DC 7626 was not
prejudicial because the highest rating to which the appellant could possibly be entitled under DC
7626 is a noncompensable rating, which is lower than the rating he is receiving. In addition, the
appellant has not shown that any other DC is potentially relevant based on the facts of this case.
Accordingly, the Court concludes that the Board's selection of the DC for scars was not "arbitrary,
10
capricious, and abuse of discretion, or otherwise not in accordance with law." 38 U.S.C.
§ 7261(a)(3)(A); see Butts v. Brown, supra (holding that selection of a DC is a question of
application of law to facts and is subject to Court review under the arbitrary-and-capricious
standard).
C. Other Arguments
This case was previously before the Court, but the appeal was terminated on the basis of a
joint motion for remand (JMR). Although the appellant does not specifically cite noncompliance
with the JMR as an error, he notes that the JMR stipulated that the prior Board decision was to be
remanded for "development and readjudication consistent with the contents" of the motion. R. at
113-14. He complains that no additional development was conducted with respect to the
gynecomastia claims before they were readjudicated. Appellant's Br. at 12. A review of the JMR
reveals that the reason for the remand was that the Board's explanation was "not clear as to the
disposition of Appellant's spinal and bi-lateral foot disabilities," particularly as to whether the
appellant received notice of his appellate rights with respect to those issues. R. at 113. The JMR
acknowledged no deficiencies in the Board's handling of the gynecomastia claims and mandated no
specific actions to be taken on remand with respect to those claims. The Court also notes in this
regard that the appellant was represented by an attorney who negotiated the JMR.
Our law is clear: Had the appellant's lawyer bargained for specific development on remand,
the development should have been specified to a degree sufficient for the Secretary to comply with
the remand. See Forcier v. Nicholson, 19 Vet.App. 414, 426 (2006) (holding that before the Court
can conclude that the Board erred by failing to enforce a joint motion, it must determine that the joint
motion enumerated clear and specific instructions to the Board). In a joint motion, it is the
responsibility of both represented parties to state clearly the purpose of the remand and to set forth
detailed directions to describe the action the Board should take upon remand. See U.S. VET .APP . R.
27(a)(2) & (3). Thus, any complaint made now regarding noncompliance with the JMR falls on deaf
ears here as the general prescription "for development and reajudication" leaves the extent of
development conducted on remand within the discretion of the Secretary, the execution of that
discretion being limited only by the law.
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Similarly, the appellant's other arguments have no merit. The Court's review of the
appellant's letter to VA after the last Supplemental Statement of the Case reveals it to be only
argument about evidence that was previously before the Board. In particular, there was evidence of
adhesions before the Board prior to the submission of the document containing the appellant's
argument. See R. at 836. Therefore, the Board had no obligation to remand to the RO for initial
consideration of new evidence. Finally, the Court regards the Board's explanation of its rating
decision to be adequate, with the exception of its neglect of DC 7626, which the Court concludes
is harmless error.
II. CONCLUSION
On consideration of the foregoing, the Court AFFIRMS the September 23, 2008, Board
decision.
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