PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
NEWPORT NEWS SHIPBUILDING AND DRY DOCK COMPANY, Petitioner,
v.
MARIE STILLEY, Widow of Lyman No. 00-1155 Stilley; DIRECTOR,
OFFICE OF WORKERS' COMPENSATION PROGRAMS, UNITED STATES DEPARTMENT OF LABOR, Respondents.
On Petition for Review of an Order of the Benefits Review
Board. (99-456, 99-456A)
Argued: November 1, 2000
Decided: March 12, 2001
Before MICHAEL, MOTZ, and KING, Circuit Judges.
_________________________________________________________________
Petition for review denied by published opinion. Judge
Michael wrote the opinion, in which Judge Motz and Judge King joined.
_________________________________________________________________
COUNSEL
ARGUED: Lawrence Philip Postol, SEYFARTH, SHAW, FAIR-
WEATHER & GERALDSON, Washington, D.C., for Petitioner. Andrew David
Auerbach, UNITED STATES DEPARTMENT OF
LABOR, Washington, D.C., for Respondent Director; Gary Richard West, PATTEN,
WORNOM, HATTEN & DIAMONSTEIN, New- port News, Virginia, for Respondent
Stilley. ON BRIEF: Henry L. Solano, Solicitor of Labor, Carol A. De Deo,
Associate Solicitor, Mark Reinhalter, Senior Attorney, UNITED STATES DEPART-
MENT OF LABOR, Washington, D.C., for Respondent Director.
_________________________________________________________________
OPINION
MICHAEL, Circuit Judge:
Lyman Stilley's disability and (in part) his death were
caused by mesothelioma, an asbestos-related lung disease. His widow was awarded
benefits under the Longshore and Harbor Workers' Compen- sation Act (LHWCA)
against Newport News Shipbuilding and Dry Dock Company (Newport News) because
of Stilley's exposure to injurious doses of asbestos as a company employee.
Newport News disclaimed liability because Stilley had also been exposed to
asbestos at subsequent, non-maritime employment with the National Aeronau- tics
and Space Administration (NASA). The ALJ nevertheless assigned full LHWCA
liability to Newport News under the "last mari- time employer rule,"
and the Benefits Review Board affirmed. Under this rule the last employer
covered by the LHWCA who causes or contributes to an occupational injury is
fully liable for compensation benefits. Newport News petitions for review,
asking that we reject or substantially modify the last maritime employer rule.
Because the present rule is consistent with the Act and passes constitutional
mus- ter, we deny the employer's petition.
I.
Lyman Stilley worked for Newport News as an electrician's
helper for about nine months in the 1950s. During his employment at New- port
News, Stilley was exposed to airborne asbestos dust and fibers in sufficient
quantity and duration to cause asbestos-related lung dis- ease. After leaving
Newport News, Stilley worked for nearly thirty years (until 1987) as an
electronics technician at NASA, where he was exposed to asbestos for sustained
periods, again in sufficient quantity to cause lung disease. In 1994 Stilley
was diagnosed with mesothelioma, an asbestos-related lung disease. After the
diagnosis Stilley had two options for seeking workers' compensation benefits.
He could file for benefits against Newport News under the LHWCA or he could
seek benefits against NASA under the Federal Employee Compensation Act (FECA).
Stilley chose to file for disability benefits against
Newport News under the LHWCA. He died shortly thereafter, on May 14, 1996, in
part because of mesothelioma. After Stilley's death his widow pur- sued the
basic compensation claim and also filed for death benefits. In the LHWCA
proceedings Newport News stipulated that while Stil- ley worked for the company
he was exposed to asbestos in sufficient quantity and duration to cause
mesothelioma, and the ALJ awarded benefits to the widow. Newport News argued
that it should not be lia- ble for the benefits because Stilley was exposed to
asbestos at his later employment with NASA. Both the ALJ at the hearing and the
Board on appeal applied the "last maritime employer rule" to hold
that New- port News was fully liable because it was the last maritime employer
to expose Stilley to asbestos in sufficient quantity and duration to cause his
disease. Newport News now petitions for review of the Board's decision, arguing
that the last maritime employer rule is unreasonable and unconstitutional.
II.
A.
Whether the Board erred in affirming the use of the last
maritime employer rule is a question of law. We accord no deference to the
Board's legal interpretation of the LHWCA because the Board does not serve a
policy making role. See Norfolk Shipbuilding & Drydock Corp. v.
Hord, 193 F.3d 797, 800 (4th Cir. 1999). However, "[a]bsent a clear
congressional intent to the contrary, we afford deference to a reasonable
construction of the Act by the Director because of his policy-making authority
with regard to the Act." Universal Mar. Corp. v. Moore, 126
F.3d 256, 268 (4th Cir. 1997). The Director has concluded that the last
maritime employer rule should be applied in the administration of claims under
the LHWCA. Newport News does not argue that application of the last maritime
employer rule violates clear congressional intent. Rather, Newport News argues
that the Act does not reasonably allow for application of the rule. Because the
Director's longstanding administrative construction appears to be rea- sonable,
we must disagree with the company.
B.
The LHWCA establishes a workers' compensation system for
workers injured or killed while employed on the navigable waters of the United
States, including any adjoining pier or land areas used to load, unload, build,
or repair ships. See 33 U.S.C. § 903(a). "[T]he general policy of
the Act [is] to encourage the prompt and efficient administration of
compensation claims." Rodriguez v. Compass Ship- ping Co., 451
U.S. 596, 612 (1981). In keeping with this policy, the Director has adopted
the last maritime employer rule, which is under challenge in this proceeding.
Because the last maritime employer rule is an extension of the last
employer rule, we begin with a discussion of the last employer rule.
A number of circuits have affirmed the use of the last
employer rule to govern the assignment of LHWCA liability when there are
multiple employers or insurance carriers in occupational disease cases. See
Norfolk Shipbuilding & Drydock Corp. v. Faulk, 228 F.3d 378, 384 (4th
Cir. 2000); Liberty Mut. Ins. Co. v. Commercial Union Ins. Co.,
978 F.2d 750, 752 (1st Cir. 1992); Avondale Indus., Inc. v. Dir.,
OWCP, 977 F.2d 186, 190 (5th Cir. 1992); Port of Portland v. Dir.,
OWCP, 932 F.2d 836, 840 (9th Cir. 1991); Jacksonville Ship- yards,
Inc. v. Dir., OWCP, 851 F.2d 1314, 1317 n.2 (11th Cir. 1988); Travelers
Ins. Co. v. Cardillo, 225 F.2d 137, 145 (2d Cir. 1955). The last employer
rule is this: "the employer during the last employment in which the
claimant was exposed to injurious stimuli, prior to the date upon which the
claimant became aware of the fact that he was suffering from an occupation
disease . . . [is] liable for the full amount of the [LHWCA] award." Cardillo,
225 F.2d at 145. Let us assume, for example, that a claimant, who is disabled
by asbestos-related lung disease, worked for maritime employer A for thirty years
installing asbestos and next worked for maritime employer B for thirty days
where he also installed asbestos. Employer B is fully liable for the claimant's
LHWCA benefits if the claimant did not learn of his dis- ease until after he
began working for employer B. The last employer rule therefore imposes full
liability on the final maritime employer even though prior maritime employers
might have contributed to the claimant's disease or injury.
When the Second Circuit endorsed the last employer rule
nearly fifty years ago in Cardillo, the court looked to one of
Congress's overriding purposes in establishing a workers' compensation system
for longshoremen: the prompt and simplified processing of claims. See
Cardillo, 225 F.2d at 145. Because longshoremen typically work for numerous
employers over the course of a career, allowing employers to apportion
liability would greatly complicate the claims process. Under an apportionment
scheme many benefit awards would be substantially delayed as employers resorted
to expert testimony and scientific evidence in an effort to prove that other
employers should share a percentage of liability. In the face of this prospect
the congressional goal of streamlined claims administration carried the day,
and the last employer rule was approved.
The last employer rule for LHWCA liability does not take
into account a case like Lyman Stilley's. Newport News is not contending that
it should be excused from liability because of the conduct of a subsequent
maritime (LHWCA-covered) employer. Rather, Newport News is contending that it
should be excused because of the conduct of a subsequent, non-maritime
employer. The question, therefore, is whether the LHWCA reasonably allows for
holding the last maritime employer fully liable for a claimant's injury even
though a subse- quent, non-maritime employer also contributed to the injury.
The "last maritime employer" rule holds the maritime employer
fully liable in such circumstances. The one circuit to squarely consider the
question held that the LHWCA totally supports application of the last maritime
employer rule. See Todd Shipyards v. Black, 717 F.2d 1280, 1286-87 (9th
Cir. 1983). But cf. Bath Iron Works v. Brown, 194 F.3d 1, 7 (1st Cir.
1999) (criticizing the last maritime employer rule in dicta).
The last maritime employer rule is justified by the
same congres- sional purpose that brought about the last employer rule,
specifically, the prompt and simplified processing of compensation claims. If
we were to reject the last maritime employer rule, the potential problems that
prompted the last employer rule decades ago would now ripen into real ones.
LHWCA benefit awards would be delayed in occupa- tional disease claims while
maritime employers attempted to prove that subsequent, non-maritime employers
were responsible for a per- centage of the liability. Indeed, attempting to
apportion liability would present difficult problems of proof for both parties,
the employer and the injured worker. These problems would be particu- larly
acute in cases of asbestos-related disease, which often develops over a long
latency period. As one of Newport News's medical experts in this case
acknowledged, "In patients with multiple expo- sures, it is not possible
by historical means to ascertain which expo- sure resulted in the
mesothelioma." We agree with the Director that rejection of the last
maritime employer rule would bring intractable problems to claims administration.
Without the rule the claims pro- cess would surely become more complicated,
protracted, and expen- sive.
Newport News does not mount any serious challenge to the
Direc- tor's case for simplified claims administration. Instead, the company
devotes much of its brief to pressing the argument that the last mari- time
employer rule is inequitable.
Newport News begins by claiming that the last maritime
employer rule "takes away the fundamental fairness of the last employer
rule." Decisions subsequent to Cardillo have suggested that while
the last employer rule is rather arbitrary, it is fair because "all
[maritime] employers will be the last employer a proportional share of the
time." Cordero v. Triple A Mach. Shop, 580 F.2d 1331, 1336 (9th
Cir. 1978). If this is borne out in practice, the rule would result in an equi-
table distribution of LHWCA liability over the long run. Newport News points
out that this same logic cannot be applied to the last mar- itime
employer rule. Under this rule the subsequent, non-maritime employer will never
be the last employer for purposes of LHWCA liability. Newport News therefore
argues that the last maritime employer rule unfairly holds maritime employers
fully liable for occupational disease caused in part by later, non-maritime
employers. It argues that because of this unfairness, the last employer should
be fully responsible for the injury, thereby relieving the prior maritime
employers of LHWCA liability. As a general matter, this argument is
unconvincing because it hinges on the unsubstantiated proposition that
claimants exposed to injurious stimuli while working first for LHWCA-covered
employers and later for non-covered employers usually file claims only under
the LHWCA. If a claimant was also exposed at subsequent, non-maritime
employment, that claimant might well pursue state or FECA benefits first. (FECA
and LHWCA generally provide equal compensation benefits to claimants in equal
pay categories. Compare 33 U.S.C. § 908 with 5 U.S.C. §§ 8105-
8107.) If the claimant sought state or FECA benefits and later decided to file
a LHWCA claim, the earlier maritime employer would receive a credit for any
state or FECA award. See 33 U.S.C. § 903(e). Accordingly, any inequity
to maritime employers under the last mari- time employer rule only arises when
the claimant seeks a remedy first under the LHWCA.
Newport News anticipates this point and suggests that we
modify the last maritime employer rule in one of two ways. The company suggests
that either (1) a claimant should not be allowed to pursue LHWCA benefits if he
has a compensation remedy against his subse- quent, non-maritime employer or
(2) a claimant should be required to proceed first against the subsequent
employer. The first proposal would hold the last employer, one covered by some
other compensa- tion system, solely liable for the claimant's injury. This
proposal is contrary to the express requirements of the LHWCA. It overlooks the
simple detail that when an employee suffers a compensable injury on a maritime
job, he is entitled to benefits under the LHWCA. See 33 U.S.C. § 903(a).
Nothing in the Act limits the injured worker to his remedy under some other
system that covers his subsequent, non- maritime employment. Moreover, limiting
the employee to his chances under some other scheme is inconsistent with the
LHWCA's goal of adequate compensation for longshoremen. State workers'
compensation programs vary widely with respect to benefit levels. See
U.S. Chamber of Commerce, Analysis of Workers' Compensation Laws
(1997). Thus, under Newport News's proposal, a claimant could be denied
compensation under the LHWCA and left to accept lower benefits under a state
workers' compensation scheme. Because the "dominant intent of Congress [in
enacting the LHWCA was] to help longshoremen," a claimant should not be
denied compensation under the LHWCA simply because he is entitled to some
relief under an alternative scheme. Reed v. The Yaka, 373
U.S. 410, 415 (1963).
Newport News's second proposal -- that claimants should be
forced to seek benefits against the subsequent employer before filing for LHWCA
benefits -- must also be rejected. Such a rule would cer- tainly benefit maritime
employers because they are entitled to a credit under the LHWCA for any
workers' compensation benefits paid to the claimant under any other system. See
33 U.S.C. § 903(e). The company's second proposal would have some advantages.
Forcing injured workers to pursue benefits from subsequent, non-maritime
employers first would result in some rough distribution of liability. And,
because of the LHWCA's credit provision, the claimant would receive benefits
that totaled those available under the LHWCA. Still, nothing in the Act
requires an injured worker to pursue other compen- sation remedies first. In
addition, such a rule would be sure to gener- ate disputes in LHWCA claims
proceedings over whether a claimant might have an alternative remedy against a
subsequent employer. This result would frustrate the LHWCA's overriding purpose
of providing a prompt and uncomplicated claims process.
Newport News also argues that the last maritime employer
rule is inequitable because it makes maritime employers liable for exposure
caused by subsequent employers. This argument is flawed. The last maritime
employer is only liable under the LHWCA if conditions at its own work site
contributed to the worker's disease. Maritime employers can avoid liability
entirely if they do not expose their employees to disease causing conditions. See
Faulk, 228 F.3d at 387- 88. A maritime employer can, in other words, avoid
LHWCA liability in a given case by proving that the employee's disease or
injury resulted exclusively from exposure during work for another employer.
For all of the foregoing reasons, we conclude that the
Director's adoption of the last maritime employer rule is a reasonable adminis-
trative measure that is consistent with the purposes of the LHWCA. The rule
serves Congress's overriding goal of providing injured long- shoremen with
prompt compensation in streamlined proceedings.
C.
Finally, Newport News asserts that the last maritime rule is
uncon- stitutional. The company says that the rule violates the Equal Protec-
tion and Due Process Clauses, but concedes that our review is for rational
basis. See Kimel v. Fla. Bd. of Regents , 528
U.S. 62, 83-84 (2000) (analyzing equal protection claim under rational
basis review); Gen. Motors Corp. v. Romein, 503
U.S. 181, 191 (1992) (same for due process claim). A rule requiring the
final maritime employer to pay compensation benefits under the LHWCA when
conditions at its work site contributed to an employee's disease is a rational
rule because it provides a prompt and simple remedy, one that is consis- tent
with congressional purpose. Newport News also argues that the last maritime
employer rule violates the Takings Clause. Because the rule is a rational
measure that assigns "the costs of the employees' disabilities to those
who have profited from the fruits of their labor," it does not violate the
Takings Clause. Usery v. Turner Elkhorn Min- ing Co., 428
U.S. 1, 18 (1976).
III.
Lyman Stilley's widow qualifies for benefits under the LHWCA
because the medical evidence established that Mr. Stilley's exposure to
asbestos at Newport News was sufficient to cause his meso- thelioma. It is
reasonable to assign full LHWCA liability to Newport News under the last
maritime employer rule even though Mr. Stilley was also exposed to asbestos
with a later, non-maritime employer. The rule is also constitutional.
Accordingly, the company's petition for review is denied.
PETITION DENIED