Ninth Circuit Publishes Significant Last Responsible Employer Decision

The Ninth Circuit published a new last responsible employer decision based on a mesothelioma death benefits claim made pursuant to Section 9 of the Longshore and Harbor Workers Compensation Act (“LHWCA”).  The decision is significant for its treatment of the Section 20(a) presumption and the sequential (as opposed to simultaneous) evidence analysis approach that it will use in last responsible employer cases involving occupational diseases.

Pursuant to Section 20(a) of the LHWCA, a claimant is given a presumption that their claim comes within the purview of the LHWCA.  To get the presumption, however, a claimant must still make out a prima facie claim alleging that he was injured and that the injury arose both “in the course of” and “out of employment.”  In this case, a question arose as to whether a claimant given the Section 20(a) presumption for one employer automatically receives that presumption for all other employers.  The Ninth Circuit stated:

“Contrary to the Board’s repeated statements in its decisions in this case, the § 20(a) presumption is relevant to the question of liability in a multi-employer case, and not just to the question of whether a claim is compensable in the first instance.  It is illogical to state, as the Board does, that § 20(a) applies to the compensability of a claim, and not to the question of the liable employer, because of the nature of the prima facie case that a claimant is required to make under § 20(a).  The presumption is invoked only if a claimant alleges that his injury arose out of and in the course of his employment.  It is implicit in this language that the employment referred to is employment with a particular employer, against whom a claim has been filed.  Where only a single employer is claimed against, the claimant would of course not be able successfully to assert a claim that fell within the § 20(a) presumption on the basis of evidence relating to employment with some other employer that was not claimed against.  Similarly, in a claim against multiple employers, the claimant should be expected to make out a prima facie case against all of the employers; if the claimant fails to make such a case against one employer, the presumption should not apply against that employer.”

Further, the court reasoned, if the evidentiary burden imposed on a litigant is different from the burden contained in the relevant statute, then it is invalid under Section 7(c) of the Administrative Procedure Act (“APA”).  The APA provides that  the proponent of a rule has the burden of proof unless provided otherwise by statute.

Notably, the Ninth Circuit appears to have created a Circuit Split with its Section 20(a) holding.  The Seventh Circuit previously addressed this issue, determining that Section 20(a) applies to a claim, and not to individual employers.  The Board adhered to the Seventh Circuit’s Marinette Marine decision which determined that “[t]he § 920(a) presumption is about whether the claimant’s injury is compensable–whether it happened in the course of work–not about who has to pay for it.”  Marinette Marine Corp. v. OWCP, 431 F.3d 1032, 1035 (7th Cir. 2005).

In addition to the application of Section 20(a), the Ninth Circuit also addressed how evidence must be analyzed in last responsible employer cases.  The argument presented to the court was that each employer’s evidence must be analyzed sequentially in occupational disease cases.   Not only did the court agree, it provided the framework for a proper sequential analysis:

“Therefore, the ALJ in multiple-employer occupational disease cases should conduct a sequential analysis, as follows: the ALJ should consider sequentially, starting with the last employer, (1) whether the § 20(a) presumption has been invoked successfully against that employer, (2) whether that employer has presented substantial, specific and comprehensive evidence so as to rebut the § 20(a) presumption…and (3) if the answer to the second question is yes, whether a preponderance of the evidence supports a finding that that employer is responsible for the claimant’s injury…  The first employer in the analytical sequence (that is, the last responsible employer in time) who is found to be responsible under this analysis shall be liable for payment of benefits, and the ALJ need not continue with this analysis for the remaining employers.  In conducting this analysis, the ALJ should consider all evidence regarding exposure or lack thereof at a particular employer, and evidence supporting a finding of exposure at a given employer may be submitted either by the claimant or by earlier employers.”

The Ninth Circuit carefully noted that it was choosing the sequential analysis approach for last responsible employer cases involving occupational diseases.  For “two-injury” cases involving cumulative traumas, the simultaneous analysis approach still applies, requiring the fact-finder to consider working conditions at multiple employers.  In other words, the competing employers have concurrent or complimentary duties, with each bearing the burden of persuading the fact-finder “that the disability is due to the injury with the other employer.”  Buchanan v. Int’l Transp. Servs., 33 BRBS 32, *4 (1999).

Albina Engine & Machine v. Director, OWCP, —F.3d—- (9th Cir. 2010)