Bethenergy Mines, Inc. v. Cunningham

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
BETHENERGY MINES, INCORPORATED, 
Petitioner,
v.
DAVID L. CUNNINGHAM; DIRECTOR,  No. 03-1651
OFFICE OF WORKERS’ COMPENSATION
PROGRAMS, UNITED STATES
DEPARTMENT OF LABOR,
Respondents.

On Petition for Review of an Order
of the Benefits Review Board.
(02-0592-BLA)
Argued: February 24, 2004
Decided: July 20, 2004
Before WILLIAMS and MICHAEL, Circuit Judges, and
William D. QUARLES, Jr., United States District Judge
for the District of Maryland, sitting by designation.
Petition for review denied by unpublished per curiam opinion. Judge
Williams wrote a separate opinion, concurring in part and concurring
in the judgment.
COUNSEL
ARGUED: William Steele Mattingly, JACKSON KELLY, P.L.L.C.,
Morgantown, West Virginia, for Petitioner. Barry H. Joyner, Office
2 BETHENERGY MINES v. CUNNINGHAM
of the Solicitor, UNITED STATES DEPARTMENT OF LABOR,
Washington, D.C., for Federal Respondent; Robert F. Cohen, Jr.,
COHEN, ABATE & COHEN, Morgantown, West Virginia, for
Respondent Cunningham. ON BRIEF: Howard M. Radzely, Acting
Solicitor of Labor, Donald S. Shire, Associate Solicitor, Christian P.
Barber, Counsel for Appellate Litigation, Sarah M. Hurley, Office of
the Solicitor, UNITED STATES DEPARTMENT OF LABOR,
Washington, D.C., for Federal Respondent.
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
OPINION
PER CURIAM:
BethEnergy Mines, Inc. (BethEnergy) petitions for review of the
decision of the U.S. Department of Labor’s Benefits Review Board
(BRB) affirming an award of benefits to David Cunningham under
the Black Lung Benefits Act (the Act), 30 U.S.C. § 901 et seq.
BethEnergy first argues that Cunningham’s claim was not timely
filed, but we conclude that the company has waived that issue.
BethEnergy also raises evidentiary challenges to the award of bene-
fits, which we reject. We therefore affirm the award of benefits and
deny BethEnergy’s petition for review.
I.
David Cunningham is a retired coal miner. He worked underground
for 28 years, beginning in the early 1950s. In 1982 the mine where
Cunningham worked shut down, and he was out of work for five
years before being called back in 1987. He last worked as a mine
mechanic, a job that required heavy labor. Cunningham quit in 1991
after shortness of breath made it difficult for him to do his job. He
was 58 years old at the time.
BETHENERGY MINES v. CUNNINGHAM 3
Cunningham filed his first claim for black lung benefits with the
Department of Labor in 1986, while he was out of work. A claims
examiner in the Department’s Office of Workers’ Compensation Pro-
grams (OWCP) denied the claim later that year, and Cunningham
made an untimely attempt to appeal. The adjudication of Cunning-
ham’s first claim is therefore final. He filed his second claim for ben-
efits in July 1997; that claim, which BethEnergy contested, made its
way to a hearing before an ALJ. The ALJ found that Cunningham had
established a material change in condition, the existence of a totally
disabling respiratory or pulmonary condition, and the existence of
pneumoconiosis (by chest x-ray and medical opinion evidence) that
was a contributing cause of his total disability. The ALJ thus awarded
benefits. BethEnergy appealed the award to the BRB, and Cunning-
ham cross-appealed the ALJ’s determination of the onset date. The
BRB affirmed the award of benefits, but remanded for reconsideration
of the issue of onset date. On remand the ALJ issued a second order
awarding benefits and establishing an earlier onset date. BethEnergy
again appealed to the BRB, which affirmed the ALJ. BethEnergy now
petitions this court for review, asserting that Cunningham’s claim is
untimely and, in the alternative, that the ALJ erred in finding the exis-
tence of coal workers’ pneumoconiosis and total disability due to
pneumoconiosis. In considering the petition, we "undertak[e] an inde-
pendent review of the record to determine whether the ALJ’s findings
of fact were supported by substantial evidence." Island Creek Coal
Co. v. Compton, 211 F.3d 203, 207 (4th Cir. 2000) (internal quotation
marks omitted). The legal conclusions of the ALJ and the BRB are
reviewed de novo. Id. at 208.
II.
BethEnergy first argues that Cunningham’s 1997 claim must be
rejected as untimely because it was not filed within three years after
he learned that he had been medically diagnosed as totally disabled
due to pneumoconiosis. See 30 U.S.C. § 932(f); 20 C.F.R.
§ 725.308(a) ("[a] claim" must be filed "within three years after a
medical determination of total disability due to pneumoconiosis
which has been communicated to the miner."). We conclude that
BethEnergy has waived the statute of limitations argument because it
stipulated at the first hearing before the ALJ that Cunningham’s claim
was timely. Administrative waiver is a "flexible" concept. Rana v.
4 BETHENERGY MINES v. CUNNINGHAM
United States, 812 F.2d 887, 889 n.2 (4th Cir. 1987). When a litigant
presents an issue to us that is "within the purview of agency exper-
tise," without having first properly presented the issue to the agency,
we will normally regard the issue to be waived. Rana, 812 F.2d at
890. This makes sense because one of the reasons for administrative
waiver is to encourage the exhaustion of administrative remedies.
Thorn v. Itmann Coal Co., 3 F.3d 713, 717 (4th Cir. 1993). Exhaus-
tion is important because "it is normally desirable to let the agency
develop the necessary factual background upon which decisions
should be based," and "judicial review may be hindered by the failure
of the litigant to allow the agency to make a factual record." McKart
v. United States, 395 U.S. 185, 194 (1969). Moreover, "practical
notions of judicial efficiency come into play as well" because if a liti-
gant "is required to pursue his administrative remedies, the courts
may never have to intervene." Id. at 195. Adequate administrative
consideration also gives the agency "a chance to discover and correct
its own errors." Id. Finally, the reasons for requiring "administrative
issue exhaustion" as a prerequisite to appellate review are most com-
pelling when "the parties are [competing] in an adversarial adminis-
trative proceeding" instead of participating in a proceeding that is not
adversarial. Sims v. Apfel, 530 U.S. 103, 109-10 (2000).
In black lung cases, developing a factual record and making find-
ings of fact is delegated to the ALJ. The respect afforded to an ALJ’s
factual findings is reflected by the rule that we (and the BRB) affirm
the ALJ’s factual findings so long as they are supported by substantial
evidence. Compton, 211 F.3d at 207 (appellate review standard); 30
U.S.C. § 932(a), incorporating 33 U.S.C. § 921(b)(3) (BRB review
standard). Moreover, ALJ hearings in black lung cases are adver-
sarial. Dep’t of Labor v. Triplett, 494 U.S. 715, 733-34 (1990) (Mar-
shall, J., concurring in the judgment). In this case, rather than
participating in the development of a factual record on the timeliness
of Cunningham’s claim, BethEnergy stipulated that the claim was
timely at the beginning of the first hearing before the ALJ. The ALJ
then relied on the stipulation to limit the hearing to consideration of
contested issues, which did not include any statute of limitations
issue. BethEnergy compounded the problem by not raising the timeli-
ness issue when the case was first appealed to the BRB and by failing
to ask the ALJ to reopen the record on this issue on remand.
BethEnergy finally raised the timeliness issue on its second appeal to
BETHENERGY MINES v. CUNNINGHAM 5
the BRB, when the BRB applied its rule that the statute of limitations
does not apply to second (or duplicate) claims like Cunningham’s.
See Faulk v. Peabody Coal Co., 14 BLR 1-18 (1990); Andryka v.
Rochester & Pittsburgh Coal Co., 14 BLR 1-34 (1990).
We conclude that BethEnergy waived the timeliness argument
because its stipulation prevented the agency from adequately address-
ing it. We are hindered in our review of the BRB’s decision because
the Board never had an opportunity to reexamine its legal rule on
timeliness in the context of all of the facts that would bear on whether
Cunningham’s claim was filed on time. See McKart, 395 U.S. at 194-
95. We would be in a better position to consider the limitations issue
with respect to a duplicate claim if we had a developed set of facts.
BethEnergy does assert that a couple of documents that happen to be
in the record would support a finding that Cunningham’s claim was
not timely filed. However, it is the ALJ’s job in the first instance, not
ours, to say what those documents mean (specifically, whether they
constitute a medical determination of total disability due to pneumo-
coniosis that was communicated to Cunningham). See Compton, 211
F.3d at 207. BethEnergy’s failure to bring these documents to the
ALJ’s attention in either hearing supports our conclusion that
BethEnergy has waived this issue. Indeed, BethEnergy suggests that
if we apply the statute of limitations to Cunningham’s claim and
"question still exists . . . the case should be remanded for the purpose
of examining Mr. Cunningham about the timeliness of his 1997 appli-
cation." Pet. Br. at 31. The company’s suggestion illustrates the
uncertain position we would be in if we considered the timeliness
issue: we would be reviewing an agency decision without a fully
developed record or findings of fact. We may invoke waiver here
because the inadequacy of the record was caused by the stipulation of
BethEnergy, a represented party, during adversary proceedings. Cf.
Sims, 530 U.S. at 110 (holding that the issue exhaustion requirement
is more appropriately invoked when the administrative proceedings
were adversarial); Rana, 812 F.2d at 889 n.2 (discussing how pro se
litigants are held to a more lenient waiver standard).
Considerations of judicial efficiency are also relevant. McKart, 395
U.S. at 195. If BethEnergy had explored whether Cunningham’s
claim was timely filed during the proceedings before the ALJ — for
instance by questioning Cunningham about when he was told he was
6 BETHENERGY MINES v. CUNNINGHAM
totally disabled by pneumoconiosis — we would know how the facts
stack up for each side, and we would be in a better position to decide
whether the company could assert a valid limitations defense. Instead,
we are being asked to intervene now — in a case that has been liti-
gated for seven years — to address the BRB’s timeliness rule just
because BethEnergy might be able to show in a third hearing before
the ALJ that Cunningham’s claim was not timely filed. See id.Finally, BethEnergy argues that we should not hold the timeliness
issue waived because it would have been futile to raise it before the
agency in light of the BRB’s rule. We do not agree. We simply do
not know whether the BRB would have reconsidered its rule if
BethEnergy had developed a compelling factual record showing that
Cunningham was advised of a medical determination of total disabil-
ity more than three years before he filed his current claim. This is
especially so because the Director of OWCP takes the position that
the BRB’s rule is incorrect. Moreover, the two circuits that have con-
sidered the limitations issue have avoided application of the BRB’s
timeliness rule. See Wyoming Fuel Co. v. Director, O.W.C.P., 90 F.3d
1502, 1507 n.7 (10th Cir. 1996); Sharondale Corp. v. Ross, 42 F.3d
993, 996 (6th Cir. 1994); see also Tenn. Consolidated Coal Co. v.
Kirk, 264 F.3d 602, 606-07 (6th Cir. 2001) (affirming an award of
benefits where the BRB did not attempt to apply its rule).* We do not
believe, in other words, that the BRB had a full opportunity to evalu-
ate its rule in the context of Cunningham’s facts, and that is a factor
in favor of finding a waiver. See McKart, 395 U.S. at 195. In any
event, regardless of whether the BRB would have revisited its rule,
BethEnergy was still "required to exhaust the fact-finding mecha-
*The Director takes a position similar to the Tenth Circuit in Wyoming
Fuel Co. v. Director, OWCP, 90 F.3d 1502, 1507 (10th Cir. 1996), that
the denial of a miner’s first claim because he is not totally disabled due
to pneumoconiosis "repudiates any earlier medical determination to the
contrary . . . render[ing it] ineffective to trigger the running of the statute
of limitations." We are not sure there is that much difference in practical
effect between the Director’s position and the BRB’s limitations rule.
Likewise, we are not exactly sure how the Director’s position squares
with what the Sixth Circuit has said in Sharondale Corp. and Tenn. Con-
solidated Coal Co. To fully understand what the differences, if any, are,
we would need more extensive briefs than we have here.
BETHENERGY MINES v. CUNNINGHAM 7
nisms" of the agency so that we could consider the issue in the con-
text of a developed set of facts. Dooley v. Ploger, 491 F.2d 608, 615
(4th Cir. 1974).
In sum, because the policy reasons for requiring administrative
exhaustion indicate that this is an appropriate case to find waiver, and
because we appear to have an inadequate factual record as a result of
BethEnergy’s stipulation to timeliness in the adversary proceedings
before the ALJ, we conclude that BethEnergy has waived its statute
of limitations defense.
III.
Because the statute of limitations defense is waived, we turn to
BethEnergy’s substantive challenges to the BRB’s decision to affirm
the ALJ’s award of benefits. To receive an award of black lung bene-
fits the claimant must prove by a preponderance of the evidence that
"(1) he has pneumoconiosis; (2) the pneumoconiosis arose out of his
coal mine employment; (3) he has a totally disabling respiratory or
pulmonary condition; and (4) pneumoconiosis is a contributing cause
to his total respiratory disability." Milburn Colliery Co. v. Hicks, 138
F.3d 524, 529 (4th Cir. 1998). BethEnergy makes two main argu-
ments for vacating the BRB’s affirmance of the award. First, the com-
pany argues that the ALJ erred by giving the most weight to the x-ray
interpretations of "dually qualified" physicians. Second, it argues that
the ALJ failed to follow Island Creek Coal Co. v. Compton, 211 F.3d
203 (4th Cir. 2000), when he did not weigh together all the evidence
in the record bearing on the issue of whether Cunningham has pneu-
moconiosis. For the reasons that follow, we reject all of BethEnergy’s
arguments directed at the ALJ’s substantive decision to award bene-
fits, and we affirm that award.
A.
BethEnergy first argues that the ALJ erred by mechanically defer-
ring to the opinions of "dually qualified" x-ray readers. The term "du-
ally qualified" physician is not defined in the regulations, but the ALJ
here used that term to refer to physicians that were both B-readers and
board-certified in radiology. A B-reader is a physician who has
passed a specific examination testing his or her ability to classify x-
8 BETHENERGY MINES v. CUNNINGHAM
rays for the presence and severity of pneumoconiosis. See 20 C.F.R.
§ 718.202(a)(1)(ii)(E). A board-certified radiologist is certified "in
radiology or diagnostic roentgenology by the American Board of
Radiology, Inc. or the American Osteopathic Association." Id.§ 718.202(a)(1)(ii)(C). The regulations provide that in evaluating con-
flicting x-ray reports, "consideration shall be given to the radiological
qualifications of the physicians" that interpreted the x-rays. Id.
§ 718.202(a)(1) (emphasis added). The regulations do not establish a
hierarchy of radiological qualifications, but by defining the terms B-
reader and board certified radiologist, they suggest that those are rele-
vant qualifications. See also id. § 718.102(c) (generally requiring x-
ray reports to include the qualifications of the reader, but specifically
requiring board certified radiologists and B-readers to indicate those
qualifications).
In Cunningham’s case there were 18 recent x-rays, read a total of
27 times. Thirteen of the readings were positive for pneumoconiosis.
The ALJ refused to consider three positive readings because the
reader, who was dually qualified, acknowledged that she could not
accurately assess the presence of pneumoconiosis due to Cunning-
ham’s "vascular congestion." The ALJ then rejected three more read-
ings because there was no record of the identity of the readers or the
degree of pneumoconiosis found. He also gave little weight to another
reading because the reader failed to classify the film. Finally, the ALJ
noted that the record contained two negative readings of a film from
1986, but he gave these readings "little weight" because Cunningham
experienced significant exposure to coal mine dust after the x-ray was
taken. The ALJ then evaluated the radiological qualifications of the
physicians reading the remaining x-rays, giving the "most weight" to
dually qualified physicians and "great weight" to the interpretations
of B-readers. Applying this evaluation of the relative qualifications of
the readers, the ALJ concluded that two of the x-rays were positive
for pneumoconiosis because they had been read as such by dually
qualified physicians and there were no negative readings of those x-
rays. He also concluded that a third x-ray was positive for pneumoco-
niosis because it was read as positive by two dually qualified readers
and negative by the other readers, all of whom were only B-readers.
Three physicians read the final x-ray as negative; two of the physi-
cians were B-readers and the third was neither a B-reader nor a board
certified radiologist. The ALJ concluded that the x-ray evidence as a
BETHENERGY MINES v. CUNNINGHAM 9
whole, "and in particular the positive readings by the most qualified
readers of record," established the existence of pneumoconiosis by a
preponderance of the x-ray evidence.
The regulations require ALJs to consider the radiological qualifica-
tions of the physicians when x-ray readings conflict. 20 C.F.R.
§ 718.202(a)(1). Although the dually qualified physicians and B-
readers have both passed examinations testing their proficiency in
classifying x-rays for pneumoconiosis, the dually qualified physicians
have board certifications in radiology or diagnostic roentgenology
that the physicians that are only B-readers lack. As a result, the ALJ’s
finding that these dually qualified physicians were more qualified
than the other x-ray readers was supported by substantial evidence.
See, e.g., Zeigler Coal Co. v. Director, O.W.C.P., 326 F.3d 894, 898-
99 (7th Cir. 2003) (affirming award of benefits where ALJ gave
greater weight to similar dually qualified physicians). Moreover, the
ALJ did not mechanically defer to readings by dually qualified physi-
cians. Rather, he gave careful consideration to several relevant factors
and even rejected three readings by a dually qualified physician. We
conclude that the ALJ did not err in his treatment of the x-ray read-
ings made by dually qualified physicians.
B.
BethEnergy also argues that we should vacate the benefits award
under Island Creek Coal Co. v. Compton, 211 F.3d 203, 209-11 (4th
Cir. 2000), because the ALJ should have weighed all of the relevant
evidence together before deciding that Cunningham has pneumoconi-
osis. A miner may prove the first element of his claim, that he has
pneumoconiosis, by any of the four methods described in 20 C.F.R.
§ 718.202(a). We consider only the two methods, chest x-ray evi-
dence, see id. § 718.202(a)(1), and physician opinion evidence, see id.
§ 718.202(a)(4), used in this case. After careful consideration of the
conflicting evidence in each category, the ALJ found by a preponder-
ance of both the x-ray evidence and the physician opinion evidence
that Cunningham has pneumoconiosis. The ALJ did not explicitly
weigh together the x-ray evidence with the physician opinion evi-
dence. However, in evaluating the physician opinion evidence, the
ALJ did point out that the opinions he found most credible were "in
accordance with the objective medical evidence of record." J.A. 734.
10 BETHENERGY MINES v. CUNNINGHAM
In Island Creek Coal Co. v. Compton the ALJ found that the claim-
ant did not establish that he had pneumoconiosis by a preponderance
of the x-ray evidence. However, the ALJ found that a preponderance
of the physician opinion evidence did establish the existence of pneu-
moconiosis. 211 F.3d at 207. The ALJ then awarded benefits without
weighing the conflicting x-ray and physician opinion evidence. Id. at
208. The BRB approved, reasoning that benefits can be awarded so
long as an ALJ finds the existence of pneumoconiosis by a preponder-
ance of the evidence in one of the categories. Id. We concluded, how-
ever, that the BRB’s legal analysis was erroneous because the Act
"states that ‘in determining the validity of claims . . . all relevant evi-
dence shall be considered.’" Id. (quoting 30 U.S.C. § 923(b)) (alter-
ation omitted). We further reasoned that "weighing all of the relevant
evidence together makes common sense. Otherwise, the existence of
pneumoconiosis could be found even though the evidence as a whole
clearly weighed against" finding that a miner has pneumoconiosis. Id.
at 209.
This case is not like Compton because the ALJ here found that the
evidence in each of the two categories offered, x-ray and physician
opinion, established pneumoconiosis. Assuming, however, that it is
error under Compton when an ALJ fails to weigh two categories of
evidence together after each one leads to a finding of pneumoconio-
sis, we conclude that the error is harmless in this case. "[W]hen a mis-
take of the administrative body is one that clearly had no bearing on
. . . the substance of [the] decision reached," that error is harmless.
Mass. Trustees of E. Gas & Fuel Assocs. v. United States, 377 U.S.
235, 248 (1964). Because the ALJ found that the most credible x-ray
and opinion evidence each showed the presence of pneumoconiosis,
it would be irrational for him to conclude on remand that "the evi-
dence as a whole . . . weighed against" finding that Cunningham has
pneumoconiosis. Compton, 211 F.3d at 209. In sum, because any fail-
ure by the ALJ to weigh the evidence together in this case could not
have influenced the outcome, we will not remand for application of
Compton.
C.
We have considered BethEnergy’s other arguments — that the evi-
dence is insufficient to establish that Cunningham’s disability was
BETHENERGY MINES v. CUNNINGHAM 11
due to pneumoconiosis and that the ALJ failed to explain adequately
his reasons for crediting evidence of pneumoconiosis and disability
due to pneumoconiosis. As to these arguments, we affirm on the rea-
soning of the BRB. Cunningham v. BethEnergy Mines, Inc., BRB
Nos. 00-0841 BLA and 00-0841 BLA/A.
IV.
The award of benefits is affirmed, and the petition for review is
denied.
PETITION FOR REVIEW DENIED
WILLIAMS, Circuit Judge, concurring in part and concurring in the
judgment:
I concur in parts I, III (with the exception of the first sentence), and
IV of the majority opinion. I concur only in the judgment, however,
as to Part II. Unlike the majority, I do not believe that BethEnergy
waived the issue of timeliness because, given the Benefit Review
Board’s (BRB) pronouncement that the three year statute of limita-
tions does not apply to duplicate claims, see Faulk v. Peabody Coal
Co., 14 BLR 1-18 (1990), it would have been futile for BethEnergy
to have raised the issue. Furthermore, the BRB addressed BethEner-
gy’s argument that the statute of limitations did apply to duplicate
claims, and it rejected that argument in continuing to adhere to Faulk.
I agree with the Director, who’s interpretation of regulations pro-
mulgated under the Black Lung Benefits Act is owed substantial def-
erence, see Clinchfield Coal Co. v. Harris, 149 F.3d 307, 309 (4th
Cir. 1998), that "[t]he plain language of the statute and the imple-
menting regulation demonstrate that the limitations period applies to
all claims filed by a miner." (Federal Respondent’s Br. at 9.) I concur
in the judgment, however, because, applying the standard advocated
by the Director, BethEnergy has failed to show that Cunningham did
not file his claim within three years of a "medical determination of
total disability due to pneumoconiosis which ha[d] been communi-
cated to the miner." 20 C.F.R. § 725.308(a) (2003).