137 F.

3d 197

Armando VENICASSA, Petitioner,

v.
CONSOLIDATION COAL COMPANY and Director, Office of
Workers'
Compensation Programs, United States Department of
Labor, Respondents.
No. 96-3736.

United States Court of Appeals,

Third Circuit.
Argued Sept. 25, 1997.
Decided Feb. 27, 1998.

Robert L. Johnson (Argued), Paul A. Tershel, Tershel & Associates,

Washington, PA, for Armando Venicassa.
J. Davitt McAteer, Acting Solicitor of Labor, Donald S. Shire, Associate
Solicitor, Christian P. Barber, Jeffrey S. Goldberge (Argued), United
States Department of Labor, Washington, DC, for Director, Office of
Workers' Compensation Programs, United States Department of Labor.
William S. Mattingly (Argued), Jackson & Kelly, Morgantown, WV, for
Consolidated Coal Company.
Before: COWEN, ROTH and LEWIS, Circuit Judges.
OPINION OF THE COURT
ROTH, Circuit Judge:

Armando Venicassa has filed a Petition for Review from the decision of the
Benefits Review Board ("Board"), affirming the denial by the Administrative
Law Judge ("ALJ") of Venicassa's claim for black lung benefits under the
Black Lung Benefits Act, 30 U.S.C. 901, et. seq. (the "Act"). In an earlier
hearing, the ALJ had dismissed United States Steel Corporation, the
responsible coal mine operator, designated by the Office of Worker's

Compensation Programs ("OWCP"), and had awarded benefits to Venicassa, to

be paid by the Black Lung Disability Trust Fund ("Trust Fund"). The Director
of the OWCP appealed this decision to the Board. The Board then remanded
Venicassa's claim to the OWCP to permit the OWCP to identify a second
responsible operator to pay benefits. We must decide whether, after the award
on the merits to Venicassa, the Board could vacate that award so that the ALJ
might designate a second responsible operator and begin the process all over
again.
2

For the reasons we discuss below, we conclude that the Board erred when it
remanded this case for designation of a second responsible operator. We will,
therefore, grant the petition for review, vacate the decision of the Board, and
remand this case to the Board to reinstate the ALJ's ruling, granting Venicassa's
claim for benefits and ordering the Trust Fund to pay them.1

We have appellate jurisdiction in this matter pursuant to the Longshoreman's

and Harbor Workers' Compensation Act, 33 U.S.C. 902, made applicable to
Black Lung Benefits cases by 30 U.S.C. 932(a). The decision of the Benefits
Review Board is a final order under Section 21(c) of the Longshoreman's and
Harbor Workers' Compensation Act, 33 U.S.C. 921(c) as incorporated by
section 422(a) of the Black Lung Benefits Act, 30 U.S.C. 932(a).

FACTS AND PROCEDURAL BACKGROUND

4

This case comes to us with a lengthy procedural history, due in large part to the
long delay by the OWCP in processing Venicassa's claim and to the
acknowledged error by the OWCP in designating the responsible coal mine
operator.2

The petitioner in this case, Armando Venicassa, worked in and around coal
mining operations for 43 years before he retired in 1985. In 1986, he filed a
claim with the OWCP for benefits under the Black Lung Benefits Act. Under
the Act, benefits are awardable to persons who are totally disabled due to
pneumoconiosis, a disease known as "black lung." The OWCP processed
Venicassa's claim for benefits with the information he supplied. Venicassa
indicated clearly on his claim form that his most recent employer was
Consolidation Coal Company, for whom he worked from January 1984 until
his retirement in August 1985. However, despite being supplied with accurate
information, the OWCP erroneously designated United States Steel
Corporation ("U.S.Steel") as the responsible operator.3

Venicassa's claim was then referred to the Department of Labor's Office of

Venicassa's claim was then referred to the Department of Labor's Office of

Administrative Law Judges for a formal hearing. In February 1987, the
Director of the OWCP moved to remand the case for identification of another
responsible operator. This motion to remand came 13 months after Venicassa
had provided the OWCP with the information to identify the proper responsible
operator. In August 1988, prior to the formal hearing on Venicassa's claim, the
ALJ denied the motion to remand.4 Citing the Benefits Review Board decision
in Crabtree v. Bethlehem Steel Corp., 7 BLR 1-354 (1984), the ALJ held that
due process concerns dictated that the hearing go forward and that, if U.S. Steel
was not the responsible operator, it would be dismissed and the Director of the
OWCP substituted to defend the claim. At the hearing, Venicassa testified that
U.S. Steel had been improperly designated as the responsible operator. The ALJ
then dismissed U.S. Steel and substituted the Director.

To succeed on a claim for black lung benefits, a claimant must establish that he
suffers from pneumoconiosis and, as a result, is totally disabled. In addition, the
claimant must establish that the pneumoconiosis is the result of coal mining.
Under the Act, pneumoconiosis may be established by x-ray evidence or by a
finding of a physician that the miner suffers from the disease. 30 U.S.C.
902(f)(1) (1986); 20 C.F.R. 718.202.

At the hearing, the ALJ concluded that Venicassa's chest x-rays did not
establish pneumoconiosis. However, the ALJ also heard five medical experts,
four of whom diagnosed some form of lung disease related to coal dust
exposure. The one physician, who did not find lung disease related to coal
exposure, did so without providing his reasoning. The ALJ, therefore, ascribed
little weight to that opinion. The ALJ concluded that the weight of medical
opinion established the finding of pneumoconiosis. Since Venicassa had at least
10 years of coal mining employment, the ALJ found that Venicassa was
entitled to the statutory presumption that his pneumoconiosis arose as a result
of coal mine employment. 30 U.S.C. 921(c) (1986). The ALJ credited
Venicassa with 43 years of coal mine employment and found evidence
sufficient to establish the existence of pneumoconiosis due to that employment.
As a result, on June 23, 1989, the ALJ awarded benefits to Venicassa.

The Director appealed this decision to the Benefits Review Board. In its review
of the ALJ's decision, the Board did not address the merits of the entitlement to
benefits. Instead, it vacated the award and remanded the case to the deputy
commissioner for determination of another responsible operator. The Board
found it significant that the Director had filed the Motion to Remand before a
formal hearing had been held. For this reason, the Board held that the due
process concerns of relitigating the case were less compelling than those facing
the Crabtree Court.

10

On remand, the OWCP designated Consolidation Coal as the responsible

operator. Venicassa's benefits were then stopped. In December 1994, a second
hearing on Venicassa's eligibility for benefits was held before the same ALJ.
Consolidation Coal submitted evidence in addition to that presented at the first
hearing. Venicassa submitted only the record of the medical evidence from the
first hearing. In addition, Venicassa testified about the deterioration of his
health during the more than five years since the initial award of benefits. The
physicians, who had presented medical testimony at the first hearing regarding
Venicassa's respiratory problems, did not testify in person at the second
hearing.

11

At the conclusion of the second hearing, the ALJ denied Venicassa's claim for
benefits. Venicassa appealed to the Benefits Review Board on June 23, 1995.
On October 22, 1996, the Board issued a final decision, affirming the decision
of the ALJ. Venicassa then timely filed his petition for review with this Court.

ANALYSIS
12

We review decisions of the Benefits Review Board and of the ALJ for errors of
law. Lango v. Director, OWCP, 104 F.3d 573, 575 (3d Cir.1997); Kowalchick
v. Director, OWCP, 893 F.2d 615, 619 (3d Cir.1990).

13

The petitioner contends that the Board's reversal of the award of benefits and its
decision to remand this case for the designation of a second responsible
operator violated due process and subjected him to substantial prejudice. He
argues that to make him relitigate a claim, on which he has already won an
award of benefits on the merits, violates due process. He further contends that,
under the rationale of the Benefits Review Board in Crabtree, the efficient
administration of the Black Lung Benefits Act dictates that the case should not
have been remanded and that the Trust Fund should be reinstated as payor.

14

The Director argues that, although a mistake occurred in the designation of U.S.
Steel as the responsible operator at the outset, the Director attempted to correct
the mistake with the motion to remand for designation of another responsible
operator. The Director further contends that the ALJ's denial of that motion was
in error and that the Trust Fund is not the appropriate payor because ultimately
Consolidation Coal was identified as the responsible operator.

15

We begin our review with an examination of the regulations, under the Black
Lung Benefits Act, which govern the designation of a responsible operator.
These regulations provide:

16 any time during the processing of a claim under this part, after sufficient evidence
At
has been made available to the deputy commissioner, the deputy commissioner may
identify a coal mine operator ... which may be liable for the payment of the claim....
Such identification shall be made as soon after the filing of the claim as the evidence
obtained permits....
17

20 C.F.R. 725.412(a). The responsible operator is defined as "the operator or

other employer with which the individual had the most recent periods of
cumulative employment of not less than one (1) year." 20 C.F.R. 725.493(a)
(1).

18

It is uncontested that, as of January 1986 when Venicassa first filed his claim,
the OWCP had all the evidence necessary to designate the proper responsible
operator. However, the Director argues that, under the Act and the applicable
regulations, a coal mine operator may be designated as responsible operator for
the purposes of defending a claim for Black Lung Benefits "at any time" during
the processing of the claim. The Director claims, therefore, that the ALJ
improperly refused to remand the case for the designation of a second
responsible operator.

19

The regulations also state, however, that the identification of the responsible
operator shall be made "as soon after the filing of the claim as the evidence
obtained permits." For this reason, Venicassa argues that, since from the outset
the Director had enough information to name the proper responsible operator,
Venicassa should not be penalized for the Director's failure to do so. Venicassa
contends that, because the OWCP did not make a prompt resolution of the
responsible operator issue, the ALJ's decision to go forward with the hearing on
the merits was appropriate; to proceed otherwise would have subjected
Venicassa to further substantial delay in the processing of his claim.

20

When the ALJ considered the Director's motion to remand the case for
designation of another responsible operator, he relied on the decision of the
Benefits Review Board in Crabtree. In Crabtree, the Board dismissed
Bethlehem Steel as the responsible operator. Instead, however, of remanding
the case for identification of another responsible operator, the Board held that
the Trust Fund would be liable for benefits because the delay involved in
relitigating the claim would offend due process. In Crabtree, the Board
concluded that "the Department of Labor is not entitled to a second opportunity
to identify another putative responsible operator." Id. at 1-356-357.

21

Remand for reconsideration of the operator issue would be tantamount to

relitigating the claim. If the Department identifies another responsible operator,

then that operator is entitled to contest the claim, develop its own evidence,
request a hearing, etc., until it has exhausted the full gamut of available
procedures for adjudicating entitlement. The fact that claimant has established
entitlement against employer does not bind any other operator(s) who were not
a party to the proceedings. This piecemeal approach encourages two
undesirable results. First, a claimant who has established entitlement in the first
round of proceedings may lose his award in a later round against another
operator. A first finding of entitlement, even though fully developed and
litigated, can be defeated in subsequent proceedings by a different operator, and
not always on the merits. Second, piecemeal litigation obviously is not
compatible with the efficient administration of the Act and expeditious
processing of claims.
22

In view of the aforementioned considerations, the Department must resolve the

operator issue in a preliminary proceeding, see 20 C.F.R. 725.412(d), and/or
proceed against all putative responsible operators at every stage of the claims
adjudication. Even a separate preliminary proceeding on the operator issue
alone is more desirable than fully litigating the claim against each operator
individually.... The Trust Fund therefore must assume liability in the absence of
any other potentially liable operator.

23

Id. at 1-357.

24

The Director contends, however, that Crabtree should not have prevented the
OWCP from identifying Consolidation Coal as the responsible operator even
after the ALJ had awarded benefits payable by the Trust Fund. The Director
urges that the critical distinction between Venicassa's case and the Crabtree
decision is that here a motion to remand was filed before the hearing on the
merits. Therefore, Crabtree does not apply. The Director contends that remand,
at the time that the motion was filed, would have been appropriate under
Crabtree because remand would have been prior to litigation of the claim;
Crabtree held only that the Director could not wait until after the ALJ had
awarded benefits against the Trust Fund before seeking to identify a second
responsible operator. Because the motion to remand was filed 18 months before
the hearing on the merits and was denied prior to the hearing, the Director
claims he did not have an opportunity to ascertain the correct responsible
operator.5

25

In resolving the motion to remand in the instant case, the ALJ concluded that
the "Director blew it" in failing to name the proper responsible operator.
(Appendix 56). For this reason, the ALJ dismissed U.S. Steel and substituted

the Trust Fund as the responsible party. The ALJ's decision places the
incentives in the proper place--the Director should have gotten it right the first
time. That would not have been an onerous task because, from the outset, the
OWCP had in its possession all the information necessary to name the proper
responsible operator.
26

The Director, however, argues that the plain language of the regulations allows
for the designation of a responsible operator "at any time" during the
processing of the claim. Therefore the OWCP should be allowed to rectify its
mistake. The Director relies on the Sixth Circuit's decision in Director,
O.W.C.P. v. Oglebay Norton Company, 877 F.2d 1300 (6th Cir.1989).

27

Although we have not decided a case involving the failure of the OWCP to
correctly name the responsible operator in the first instance, Oglebay addresses
such a situation in a black lung, widow's benefits case. In Oglebay, the court
considered the identification of a responsible operator nearly ten years after the
claim was filed. The Director appealed a decision of the Benefits Review Board
which had dismissed the company as responsible operator. The Sixth Circuit
held that the identification of the company as "responsible operator" nearly ten
years after the claim was filed was valid and that the transfer of liability to the
Fund was improper. In reaching this conclusion, the Sixth Circuit interpreted
the regulation, governing the identification of the responsible operator (20
C.F.R. 725.412(a)). The Court noted that the regulation permits identification
of the responsible operator at any time during the processing of the claim. In
addition, the Sixth Circuit found the transfer of liability to the Trust Fund to be
improper when there is an affirmative identification of a responsible operator.
Oglebay, 877 F.2d at 1304. The court reasoned that neither the applicable
statutes nor regulations indicated that identification of the responsible operator
should be disregarded merely because it was inefficiently reached; the operator
would not be substantially prejudiced in defending the matter on its merits.

28

The Director asks us to disregard Crabtree and follow the Sixth Circuit's
reasoning in Oglebay. We are not, however, bound by Oglebay. Moreover, the
instant case is easily distinguishable from Oglebay. First, Oglebay involved a
dispute between the OWCP and the responsible operator. The case before us
involves a dispute between the claimant, the Director, and the putative
responsible operator. Second, in Oglebay the ALJ decided to remand the case
for determination of another responsible operator prior to holding a hearing on
the merits. In the instant case, the decision to remand was made after a formal
hearing on the merits and after the ALJ had awarded benefits. In other words,
the Crabtree concerns about due process and piecemeal litigation--relied on by
the ALJ in denying the motion to remand--are greater in the instant case than

were those faced by the court in Oglebay.

29

Moreover, there is another important distinction between this case and

Oglebay. The Oglebay court reasoned that inefficient identification of the
responsible operator does not invalidate that identification. In our case,
however, the Director had before it all the relevant information necessary to
designate the proper responsible operator--but failed to do so. The OWCP's
failure here is more than mere inefficiency. Indeed, this failure penalized
Venicassa, who had already litigated the case on the merits and won. It also
penalized Consolidation Coal, which had to litigate a 10 year old claim.

30

The Director contends, however, that, because the motion to remand was made
prior to litigation of the claim on the merits, remand and designation of a
responsible operator were appropriate and did not raise due process concerns.
Consolidation Coal argues, on the other hand, that the critical issue here is not
the timing of the motion to remand but the timing of the identification of the
responsible operator. To resolve this dispute, we must go back to the language
of the regulation.

31

The regulation allows for the designation of a responsible operator "at any
time." Thus, the Director asserts that, upon receiving the motion to remand, the
ALJ should have allowed the designation of a second responsible operator. The
Director argues that, while the OWCP clearly erred in failing to identify
Consolidation Coal as the responsible operator at the outset, the ALJ erred in
denying the motion to remand the case in order to correct the problem. The
Director contends that the Act gives the OWCP sole responsibility for
identifying the responsible operator who may be liable for payment of benefits.
20 C.F.R. 725.410(b), 725.412. The Director relies on the regulatory
language which provides for designation of a responsible operator "at any time
during the processing of a claim" and contends that a claim is still being
"processed" even after it is referred to the ALJ for a hearing.

32

While the regulation clearly states that the designation of the responsible
operator may be made "at any time," the language of the regulation triggers the
process by providing that the designation be made "after sufficient evidence has
been made available to the deputy commissioner." The regulation then further
limits the process by providing that the designation "shall be made as soon after
the filing of the claim as evidence obtained permits." 20 C.F.R. 725.412(a).
The focus of the regulation is clearly on the swift and accurate designation of
the responsible operator so that the claim may be resolved through the
presentation of evidence to the fact finder by the appropriate parties.

33

Because the OWCP did not make a timely designation of the proper responsible
operator, nor did it even make a timely attempt to correct its misdesignation or
to add Consolidation Coal as a potential responsible operator, we conclude that
the ALJ at the first hearing correctly designated the Trust Fund as the
defending party.6

34

Moreover, this result is consistent with the purpose behind the establishment of
the Trust Fund. The Trust Fund was established by the Black Lung Benefits
Revenue Act of 1977 "to provide a more effective means of transferring the
responsibility for the payment of benefits from the Federal government to the
coal industry...." 20 C.F.R. 725.490(a). The Black Lung Benefits Revenue
Act of 1977, (Pub. Law 95-227) (92 Stat. 11) (1978 U.S.C.C.A.N.) (codified at
30 U.S.C. 934a). The fund is financed by the coal industry through an excise
tax on the sale of coal. 26 U.S.C. 9501.

35

The Director argues that the Trust Fund should not be liable in this instance
because the Trust Fund was created to assume liability for benefits in the event
that no responsible operator could be found. The statute provides that the Trust
Fund is available for the payment of benefits in any case in which the Secretary
determines that "there is no operator who is required to secure the payment of
such benefits." 26 U.S.C. 9501(d)(1)(B).7

36

In order to support its argument that the Trust Fund should be liable only in the
absence of an identifiable responsible operator, the Director emphasizes a
portion of the Act's legislative history which states that Congress intended to
ensure that individual coal operators, rather than the Trust Fund, would be
liable for claims.8 The Sixth Circuit relied on these statements in holding that,
where a responsible operator has been identified, the transfer of liability to the
Trust Fund is improper. Oglebay, 877 F.2d at 1304.

37

However, investigation into the legislative history indicates that Congress did
not contemplate the situation before us. Indeed, the Trust Fund's architects were
motivated by a desire to curb the ability of coal mine operators to transfer assets
in order to sidestep liability as responsible operators.

38

At the time of the Trust Fund's creation, its drafters were cognizant of the
structural changes in the coal industry which resulted in the consolidation of
numerous coal companies and the disappearance of others. They were
particularly conscious of the impact of these changes on future claimants and of
their effect on the responsibility of successor and former operators.9

During
the last two decades, the coal industry has undergone major structural
39
changes. Of the 50 largest coal companies, 29 have become captive of other
industries ... In most instances, these acquisitions transferred intact the ownership of
the mines and operations of existing coal producers to the larger and more
diversified parent corporations.... It was originally the intent of Congress that such
entities should bear the liability for black lung diseases arising out of employment in
their mines....
40

S. Rep. 209, at 9.

41

Thus, while the Act evidences an intent that individual coal mine operators,
rather than the Trust Fund, assume liability for the payment of black lung
benefits, the rationale behind this determination is the protection of claimants
from the denial of benefits due to the disappearance of any responsible
operator. Here, because of the failure of the OWCP to identify the responsible
operator "as soon after the filing of the claim as the evidence obtained permits,"
it is the claimant who will suffer unless the Trust Fund assumes responsibility
for payment of the benefits. This result will protect the claimant, which is the
purpose of the Act.

CONCLUSION
42

The Black Lung Benefits Act was enacted in order to ensure benefits for coal
miners who have been totally disabled due to black lung disease as a result of
their work in coal mines. Despite possessing accurate information regarding
Venicassa's employment history, the Office of Worker's Compensation
Programs failed to designate the proper responsible operator to defend the
claim. As a result of this failure, the Benefits Review Board ruled that
Venicassa had to relitigate his claim. We conclude, however, that the OWCP's
failure to make a timely designation of the proper responsible operator should
not have jeopardized the award of benefits which had been made to Venicassa.
We will, therefore, grant the petition for review, vacate the decision of the
Benefit's Review Board, and remand this case for reinstatement of the June 23,
1989, order and award of the Administrative Law Judge.

43

COWEN, Circuit Judge, dissenting.

44

Today the majority holds that a district director is not authorized, under any
circumstances, to correct a mistaken responsible operator identification.
Because this holding is contrary to, inter alia, the Director's reasonable
interpretation of 20 C.F.R. 725.412(a) and (c), congressional intent, and the

Sixth Circuit's decisions in Caudill Construction Co. v. Abner, 878 F.2d 179
(6th Cir.1989) and Director, OWCP v. Oglebay Norton Co., 877 F.2d 1300 (6th
Cir.1989), I must respectfully dissent.
I.
45

The standards governing our review of an agency's interpretation of its own

regulations are well known and not in dispute. We owe "substantial deference"
to the agency's interpretation, which has " 'controlling weight unless it is plainly
erroneous or inconsistent with the regulation.' " Thomas Jefferson Univ. v.
Shalala, 512 U.S. 504, 512, 114 S.Ct. 2381, 2386, 129 L.Ed.2d 405 (1994)
(quoting Bowles v. Seminole Rock & Sand Co., 325 U.S. 410, 414, 65 S.Ct.
1215, 1217, 89 L.Ed. 1700 (1945)); see also Sekula v. FDIC, 39 F.3d 448, 453
(3d Cir.1994). Absent constitutional or statutory violations, the only
circumstance in which we do not defer is where "an 'alternative reading is
compelled by the regulations's plain language or by other indications of the
[agency's] intent at the time of the regulation's promulgation.' " Thomas
Jefferson Univ., 512 U.S. at 512, 114 S.Ct. at 2386-87 (quoting Gardebring v.
Jenkins, 485 U.S. 415, 430, 108 S.Ct. 1306, 1314, 99 L.Ed.2d 515 (1988)). "In
addition, we give judicial deference to the Director, as policymaker, rather than
to the Board, which is purely an adjudicator." Director, OWCP v. Eastern Coal
Corp., 54 F.3d 141, 147 (3d Cir.1995) (citations omitted). I believe that the
majority fails to adhere to these fundamental principles. Indeed, the most
striking aspect of the majority's opinion is its complete failure even to mention
our duty, under most circumstances, to defer to an agency's interpretation of its
own regulations.

II.
46

Section 725.412 provides, in pertinent part, as follows:

47

(a) At any time during the processing of a claim under this part, after sufficient
evidence has been made available to the [district director], the [district director]
may identify a coal miner [sic] operator (see 725.491) which may be liable
for payment of the claim.... Such identification shall be made as soon after the
filing of the claim as the evidence obtained permits....

48

....

49

(c) If within one year after the final adjudication of a claim, the adjudication
officer determines that an operator which may be liable for the payment of
benefits has not been notified under this section, such adjudication officer shall

give notice of possible liability and an opportunity to respond to such operator.

The adjudication officer shall then take such further action on the claim as may
be appropriate.
50

20 C.F.R. 725.412(a), (c).

A. The Director's Interpretation

51

According to the Director, section 725.412 provides that: (1) a district director1
is authorized to correct mistaken responsible operator identifications; (2) such
corrections may occur "at any time" during the processing of a claim, and up to
one year after final adjudication; and (3) a district director has no duty--beyond
the "at any time" limitation above--to identify a responsible operator within a
reasonable time after the information necessary to make an identification
becomes available to him. Each of these contentions will be addressed in turn.

1. Ability to Make Corrections

52

The Director asserts that section 725.412 "clearly authorizes the correction of a
mistaken responsible operator identification...." Respondent's Br. at 12. I agree.
There is simply nothing in the regulation that is inconsistent with this
interpretation. Nor does this interpretation conflict with any statutory or
constitutional provisions. On the contrary, the Director's view effectuates clear
congressional intent to limit Trust Fund liability to those instances in which no
responsible operator can be identified. See 26 U.S.C. 9501(d). Moreover, it is
supported by two persuasive Sixth Circuit decisions. See Oglebay, 877 F.2d at
1305 (corrections permitted pursuant to section 725.412(a)); Caudill Const.,
878 F.2d at 181 (corrections permitted pursuant to section 725.412(c)).
Consequently, we must defer to the Director's reasonable interpretation.

2. Timing of Corrections
53

The Director next contends that section 725.412(a) and (c) authorize the district
director or ALJ to correct a mistaken responsible operator identification "at any
time" during the processing of a claim, and up to one year after a final
adjudication. The Director also contends that the ability to make such
corrections is not limited to cases--such as this one--where an attempt to correct
a mistaken identification occurs prior to final adjudication of a claim.

54

Once again, the Director's interpretation is not inconsistent with the regulation.
Moreover, it is not inconsistent with due process. Due process is simply not

implicated when--as here--an attempt to correct a misidentification is made

prior to final adjudication of the claim.2 Cf. Caudill Const., 878 F.2d at 181
(district director authorized to correct misidentification of responsible carrier
"even where a final compensation order has been issued against the operator").
While it might seem unfair to require a claimant who has already proven
entitlement once to have to prove it again, relitigation of a finally-decided claim
is not unprecedented in the black lung program. The statutorily prescribed
modification procedure, for example, allows a fact finder, upon any party's
motion, to review previously-considered facts and find a "mistake in a
determination of fact." 20 C.F.R. 725.310. Indeed, the Supreme Court has
observed that
55 plain import of [the modification statute] was to vest a [district director] with
the
broad discretion to correct mistakes of fact, whether demonstrated by wholly new
evidence, cumulative evidence, or merely further reflection on the evidence initially
submitted.
56

O'Keeffe v. Aerojet-General Shipyards, Inc., 404 U.S. 254, 256, 92 S.Ct. 405,
407, 30 L.Ed.2d 424 (1971) (per curiam). Thus, "the statute and regulations
give the [district director] the authority, for one year after the final order on the
claim, to simply rethink a prior finding of fact." Jessee v. Director, OWCP, 5
F.3d 723, 724-25 (4th Cir.1993).

57

In addition, Venicassa had no expectation of finality in the ALJ's 1989 award of

benefits. See id. ("[T]he "principle of finality" just does not apply to Longshore
Act and black lung claims as it does in ordinary lawsuits."). The Director
appealed that decision to the Board, arguing not only that the ALJ had
erroneously denied the remand motion, but that he had erred in awarding
benefits.3 Venicassa had no reason, therefore, to believe that the ALJ's award
settled the issue of his entitlement to benefits. His entitlement remained at issue
regardless of the identity of the liable party. We must defer to the Director's
interpretation of this regulation.

3. Duty to Identify as Soon as Evidence Permits

58
59

Finally, the Director asserts that it is inappropriate to mandate identification of

a responsible operator within a reasonable time after the information necessary
to make an identification becomes available to the district director. Such a
reading, according to the Director, "essentially reads a time limitation into the
regulation that 'would inject a degree of uncertainty into future responsible
operator identifications.' " Respondent's Br. at 30 (quoting Oglebay, 877 F.2d at
1303).

60

The Director's interpretation of this language is inconsistent with the regulation.

While section 725.412(a) includes the phrase "at any time during the processing
of the claim," it also includes the phrase "[s]uch identification shall be made as
soon after the filing of the claim as the evidence obtained permits." Thus, the
Director impermissibly reads the second phrase completely out of the
regulation for all practical purposes. See Oglebay, 877 F.2d at 1306-07
(Wellford, J., dissenting). Because meaning must be given to every word "so
that no part will be inoperative or superfluous, void or insignificant," Sekula, 39
F.3d at 454-55 n. 16, this aspect of the Director's interpretation is entitled to no
deference.

4. Conclusion
61

Based on the foregoing, I conclude that a district director is authorized to

correct a mistaken responsible operator identification at any time prior to final
adjudication of a claim. However, such corrections must be made within a
reasonable time after the information necessary to make such a correction
becomes available to him. Because the Director sought to correct the mistaken
identification in this case approximately eighteen months before final
adjudication of the claim, he acted within a reasonable time, and the ALJ
should have granted his motion to remand. I would therefore affirm the Board's
decision to vacate Venicassa's award so that the ALJ could designate the proper
responsible operator.
B. The Majority's Interpretation

62

According to the majority, section 725.412(a) must be interpreted as follows:

63

While the regulation clearly states that the designation of the responsible
operator may be made "at any time," the language of the regulation triggers the
process by providing that the designation be made "after sufficient evidence has
been made available to the deputy commissioner." The regulation then further
limits the process by providing that the designation "shall be made as soon after
the filing of the claim as evidence obtained permits." 20 C.F.R. 725.412(a).
The focus of the regulation is clearly on the swift and accurate designation of
the responsible operator so that the claim may be resolved through the
presentation of evidence to the fact finder by the appropriate parties.

64

Maj. Op. at 203.

65

While the majority properly concludes that section 725.412(a) requires the

designation of a responsible operator as soon as the evidence reasonably

permits, see Oglebay, 877 F.2d at 1306-07 (Wellford, J., dissenting), it fails to
provide any mechanism for the correction of a mistaken responsible operator
identification, regardless of how quickly and reasonably the attempted
correction is made. See Maj. Op. at 202 ("The ALJ's decision [to deny the
Director's motion to remand] places the incentives in the proper place--the
Director should have gotten it right the first time. That would not have been an
onerous task, because, from the outset, the OWCP had in its possession all the
information necessary to name the proper responsible operator.") (emphasis
added). This view is incorrect for several reasons.
66

First, the majority's interpretation is inconsistent with, and completely ignores,

our obligation to defer to an agency's interpretation of its own regulations
unless it is plainly erroneous or inconsistent with the regulation.4 Here, the
Director reads section 725.412 to permit the correction of mistaken responsible
operator identifications. Because this view is not "plainly erroneous or
inconsistent with the regulation," see Caudill Const. Co., 878 F.2d at 181;
Oglebay, 877 F.2d at 1305, it is entitled to substantial deference.

67

Second, the majority's conclusion that a district director is never authorized to

correct a mistaken responsible operator identification fails to give any effect
whatsoever to section 725.412(c). Such a reading violates our duty "to give
each word of the [regulation] operative effect[,]" Smith v. Magras, 124 F.3d
457, 462 (3d Cir.1997), and renders this provision "inoperative or superfluous,
void or insignificant." Sekula, 39 F.3d at 454-55 n. 16 (quotation marks
omitted).

68

Third, the majority view is at odds with clear congressional intent, expressed
over a period of years, to limit Trust Fund liability to instances in which no
responsible operator can be identified. See 26 U.S.C. 9501(d). In creating the
Trust Fund, Congress intended to "ensure that individual coal operators rather
than the trust fund bear the liability for claims arising out of such operator's
mines to the maximum extent feasible." S.Rep. No. 95-209, 95th Cong., 1st
Sess. 9 (1977), reprinted in House Comm. on Educ. and Labor, 96th Cong.,
Black Lung Benefits Reform Act and Black Lung Benefits Revenue Act of
1977, 612 (Comm. Print 1979); see also Old Ben Coal, 826 F.2d at 693.

69

Finally, the majority's interpretation also conflicts with the Sixth Circuit's
decision in Oglebay, where at least two judges (and possibly a third 5 ) concluded
that section 725.412(a) authorizes the correction of a mistaken responsible
operator identification. 6 It is also at odds with Caudill Construction, where the
Sixth Circuit observed that subsection (c) "permits notification of a new

operator where investigation reveals that prior identification was mistaken...."

878 F.2d at 181. Contrary to the majority's interpretation of the regulation, it is
clear that section 725.412(a) and (c) both authorize the correction of mistaken
responsible operator identifications.
70

I respectfully dissent.

We are also asked to decide whether the ALJ's determination at a second

hearing, denying benefits, was supported by substantial evidence. Venicassa
submits that the denial of benefits by the ALJ on remand was irrational because
the ALJ relied on the same medical evidence that he had relied on to make the
initial award of benefits. Because of our decision on the second designation
issue, we do not need to reach this question

Unfortunately, the OWCP's failure to designate the proper responsible operator

at the outset has exacerbated a problem all too familiar to us. We have
confronted a disturbing record of delay in processing claims for black lung
benefits in prior cases. See Kowalchick v. Director, OWCP, 893 F.2d 615 (3d
Cir.1990) (Benefits awarded 17 years after the initial claim was filed); Lango v.
Director, OWCP, 104 F.3d 573 (3d Cir.1997) (noting long delay in processing
claim for benefits)

Venicassa indicated on his claim form that he was employed by U.S. Steel from
1942 until January 1984. The regulations define "responsible operator" as "the
operator or other employer with which the miner had the most recent periods of
cumulative employment of not less than one (1) year ..." 20 C.F.R.
725.493(a)(1)

The record reflects that the ALJ, who ruled on the remand motion in August
1988, did not receive the case until May or June of that year even though the
case was referred to the Office of Administrative Law Judges in September of
the previous year. Appendix 56-57

In making this argument, the Director also relies on Director, OWCP v. Trace
Fork Coal Company, 67 F.3d 503 (4th Cir.1995). However, Trace Fork does
not in fact support the Director's position. In Trace Fork, the ALJ dismissed the
coal company as responsible operator, refusing to remand the case for the
designation of another responsible operator, and then named the Trust Fund as
payor. The ALJ awarded benefits and the Director appealed the ALJ's finding
that the Trust Fund was liable. The Benefits Review Board affirmed the ALJ's
ruling. The Fourth Circuit held that dismissal of Trace Fork as responsible

operator was proper and affirmed the refusal to remand for the naming of
another responsible operator. The Board and the Fourth Circuit based their
decisions on Crabtree and on the holding in that case that the Director must
resolve the responsible operator issue in a preliminary proceeding or else
proceed against all potential operators at each stage of the adjudication in order
to avoid piecemeal litigation and due process concerns. The Trace Fork court
found that to remand the case would allow a second operator to challenge the
claimant's entitlement to benefits. The court concluded, "We are unwilling to
potentially upset the finding that [claimant] is entitled to benefits, a matter
already fully litigated on the merits. The Director had full opportunity, and even
a motion, to ascertain the responsible operator as a preliminary matter, but
simply refused." Trace Fork, 67 F.3d at 508
6

Contrary to the approach of the petitioner, and to the views expressed in the
dissent, we do not ground our decision on due process considerations

The provision reads that the Trust Fund shall be liable for the payment of
benefits in any case in which the Secretary determines that:
(a) the operator liable for the payment of such benefits-(i) has not commenced payment of such benefits within 30 days after the date of
an initial determination of eligibility by the Secretary, or
(ii) has not made a payment within 30 days after the payment is due,
(b) there is no operator who is required to secure payment of such benefits, ...
26 U.S.C. 9501(d) (emphasis added).

"It is further the intention of this section, with respect to claims related to which
the miner worked on or after January 1, 1970, to ensure that individual coal
operators rather than the trust fund bear the liability for claims arising out of
such operator's mines, to the maximum extent feasible." S. Rep. 209, 95th
Cong., 1st Sess. 9 (1977), reprinted in House Comm. On Educ. And Labor,
96th Cong., Black Lung Benefits Reform Act and Black Lung Benefits
Revenue Act of 1977, 612 (Comm. Print 1979). See also Old Ben Coal Co. v.
Luker, 826 F.2d 688, 693 (7th Cir.1987)

"When the black lung benefits provisions of the Federal Coal Mine Health and
Safety Act of 1969 were first enacted, it was the expectation of Congress that
after the Federally financed portion of the program terminated, individual coal
mine operators would assume the liability for benefits either under an approved
state workers' compensation program or under Part C of the Federal Act. In

order to facilitate assessment of liability against coal mine operators, Section

422(I) prohibited the avoidance of such liability by coal mine operators through
the mechanism of a post enactment transfer of assets...." S. Rep. 209 at 8
1

A district director is a person authorized to develop and adjudicate claims for

black lung benefits. For administrative purposes only, regulations substitute the
term district director for the term deputy commissioner, which is found in the
Longshore Act. See 20 C.F.R. 725.101(a)(11)

Because a motion to remand was made prior to final adjudication of the merits
in this case, we need not consider the Director's position that due process would
not bar a district director's attempt to correct a mistaken responsible operator
identification when that attempt is not made until after final adjudication

By filing a motion to remand, and then renewing it at the hearing, the Director
did everything within his control to correct the mistaken responsible operator
identification before the ALJ awarded benefits payable by the Trust Fund. The
Director could not order the ALJ to grant the motion, see Director, OWCP v.
Newport News Shipbuilding and Dry Dock Co., 514 U.S. 122, 134, 115 S.Ct.
1278, 1287, 131 L.Ed.2d 160 (1995); Old Ben Coal Co. v. Luker, 826 F.2d
688, 696 n. 4 (7th Cir.1987), and an appeal to the Board at that point would
have been interlocutory

The majority expressly disavows reaching its conclusion on due process

grounds. See Maj. Op. at 203 n. 6. It does not, however, offer any reason why
the Director's interpretation is not owed "substantial deference." Indeed, rather
than defer to the Director's interpretation of its own agency guidelines, the
majority defers to the Benefit Review Board's interpretation of section 725.412
in Crabtree v. Bethlehem Steel Corp., 7 BLR 1-354 (1984). See id. at 202 ("In
other words, the Crabtree concerns about due process and piecemeal litigation
... are greater in the instant case than were those faced by the court in
Oglebay."). Such deference, however, is improper for two reasons. First, "we
give judicial deference to the Director, as policymaker, rather than to the Board,
which is purely an adjudicator." Eastern Assoc. Coal Corp., 54 F.3d at 147
(citations omitted). Second, Crabtree was wrongly decided because it fails to
provide for the correction of mistaken responsible operator identifications and
improperly injects a requirement into the regulation that the responsible
operator must be identified at a preliminary proceeding. Crabtree; 7 BLR at 1357; see also Director, OWCP v. Trace Fork Coal Co., 67 F.3d 503, 508 (4th
Cir.1995) (requiring identification of a responsible operator at a preliminary
proceeding)

Although Judge Wellford expressed concern in his Oglebay dissent with

"giving the [district director] unfettered discretion to name a responsible

operator at any time, virtually without limitation[,]" 877 F.2d at 1306
(Wellford, J., dissenting), and with "encourag[ing] sloppy and unreasonable
administration of the Act[,]" id. at 1307 (Wellford, J., dissenting), he did not
consider whether section 725.412 authorized the correction of mistaken
responsible operator identifications. It is interesting to note, however, that
Judge Wellford joined the majority opinion in Caudill Construction, a case
decided just seven days before Oglebay, which observed that section
725.412(c) "permits notification of a new operator where investigation reveals
that prior identification was mistaken...." 878 F.2d at 181
6

The majority correctly observes that Oglebay is somewhat distinguishable from

the instant case because correction of the mistaken responsible operator
identification was made prior to final adjudication of the claim. However, this
distinction is immaterial because, as noted above, relitigation of a finallydecided claim is: (1) consistent with the regulation; (2) consistent with
congressional intent; (3) not uncommon in the black lung program; and (4)
does not violate due process