United States Court of Appeals for the Federal Circuit
MILITARY-VETERANS ADVOCACY,
Petitioner
v.
SECRETARY OF VETERANS AFFAIRS,
Respondent
2019-1600
Petition for review pursuant to 38 U.S.C. Section 502.
NATIONAL ORGANIZATION OF VETERANS’
ADVOCATES, INC.,
Petitioner
PARALYZED VETERANS OF AMERICA,
Intervenor
v.
SECRETARY OF VETERANS AFFAIRS,
Respondent
2019-1680
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MILITARY-VETERANS ADVOCACY v.
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Petition for review pursuant to 38 U.S.C. Section 502.
CARPENTER CHARTERED,
Petitioner
v.
SECRETARY OF VETERANS AFFAIRS,
Respondent
2019-1685
Petition for review pursuant to 38 U.S.C. Section 502.
PHILLIP BOYD HAISLEY, NATIONAL VETERANS
LEGAL SERVICES PROGRAM,
Petitioners
v.
SECRETARY OF VETERANS AFFAIRS,
Respondent
2019-1687
Petition for review pursuant to 38 U.S.C. Section 502.
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Decided: July 30, 2021
ROBBIE MANHAS, Orrick, Herrington & Sutcliffe LLP,
Washington, DC, argued for petitioner Military-Veterans
Advocacy. Also represented by MELANIE L. BOSTWICK;
JOHN B. WELLS, Law Office of John B. Wells, Slidell, LA.
MICHAEL BERN, Latham & Watkins LLP, Washington,
DC, argued for petitioner National Organization of Veterans’
Advocates, Inc. and intervenor Paralyzed Veterans of
America. National Organization of Veterans’ Advocates,
Inc. also represented by GENEVIEVE PATRICIA HOFFMAN,
ROMAN MARTINEZ, BARRETT TENBARGE.
LINDA E. BLAUHUT, Paralyzed Veterans of America,
Washington, DC, for intervenor Paralyzed Veterans of
America.
KENNETH M. CARPENTER, Law Offices of Carpenter
Chartered, Topeka, KS, argued for petitioner Carpenter
Chartered.
ALEX SCHULMAN, Paul Hastings LLP, Washington, DC,
argued for petitioners Phillip Boyd Haisley, National Veterans
Legal Services Program. Also represented by
STEPHEN BLAKE KINNAIRD; BARTON F. STICHMAN, National
Veterans Legal Services Program, Washington, DC.
SOSUN BAE, Commercial Litigation Branch, Civil Division,
United States Department of Justice, Washington,
DC, argued for respondent in 2019-1600, 2019-1687. Also
argued by WILLIAM JAMES GRIMALDI in 19-1680, DAVID
PEHLKE in 2019-1685. Also represented by ERIC P.
BRUSKIN, JEFFREY B. CLARK, MARTIN F. HOCKEY, JR.,
ROBERT EDWARD KIRSCHMAN, JR.; BRIAN D. GRIFFIN,
ANDREW J. STEINBERG, Office of General Counsel, United
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States Department of Veterans Affairs, Washington, DC;
DAVID J. BARRANS in 2020-1687, Commercial Litigation
Branch, Civil Division, United States Department of Justice,
Washington, DC.
Before REYNA, CLEVENGER, and CHEN, Circuit Judges.
CHEN, Circuit Judge.
In 2017, Congress enacted the Veterans Appeals Improvement
and Modernization Act (AMA) to reform the administrative
appeals system of the Department of Veterans
Affairs (VA). See Pub. L. No. 115–55, 131 Stat. 1105 (2017)
(codified at scattered sections of 38 U.S.C.). The AMA replaced
the existing VA appeals system, which had shepherded
all denials of veteran disability claims through a
one-size-fits-all appeals process. Under the AMA, claimants
may now choose between three procedural options in
response to an unfavorable initial decision: (1) filing a supplemental
claim based on additional evidence, (2) requesting
higher-level review within the VA based on the same
evidentiary record, and (3) filing a notice of disagreement
(NOD) to directly appeal to the Board of Veterans Appeals
(Board). Pursuant to its notice-and-comment rulemaking
authority, the VA promulgated a series of regulations to
implement the AMA. See VA Claims and Appeals Modernization,
84 Fed. Reg. 138 (Jan. 18, 2019) (Final Rule). Several
veterans’ service organizations, a law firm, and an
individual (collectively, Petitioners) filed four separate petitions
raising thirteen rulemaking challenges to these regulations
under 38 U.S.C. § 502.1
1 Specifically, Petitioners include: Military-Veterans
Advocacy (MVA) in Military-Veterans Advocacy v. Sec’y
of Veterans Affs., Appeal No. 19-1600; National
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Before oral argument, we requested supplemental
briefing on whether Petitioners have standing to challenge
the regulations identified in their petitions. We conclude
that two veterans’ service organizations, MVA and PVA,
have demonstrated associational standing based on
claimed injuries to their members to collectively bring
three of their seven challenges. Because we conclude that
no Petitioner has demonstrated standing to raise any of the
remaining challenges, we dismiss the petitions with respect
to those challenges.
The three regulations for which MVA and PVA have
standing to challenge all relate to supplemental claims—
one of the three review lanes established by the AMA. Specifically,
38 C.F.R. § 14.636(c)(1)(i) limits when a veteran’s
representative may charge fees for work on supplemental
claims; 38 C.F.R. § 3.2500(b) bars the filing of a supplemental
claim when adjudication of the same claim is pending
before a federal court; and 38 C.F.R. § 3.155 excludes
supplemental claims from the intent-to-file framework.
We hold that all three regulations are invalid for contravening
the unambiguous meaning of their governing
statutory provisions. Accordingly, we grant-in-part and
dismiss-in-part MVA’s and PVA’s petitions in Appeal Nos.
Organization of Veterans’ Advocates, Inc. (NOVA) and Paralyzed
Veterans of America (PVA) in Nat’l Org. of Veteran’
Advocates, Inc. v. Sec’y of Veterans Affs., Appeal No. 19-
1680; Carpenter Chartered in Carpenter Chartered v. Sec’y
of Veterans Affs., Appeal No. 19-1685; and Phillip Boyd
Haisley and National Veterans Legal Services Program
(NVLSP) in Haisley v. Sec’y of Veterans Affs., Appeal No.
19-1687. These four appeals were treated as companion
cases for purposes of oral argument. Because they involve
overlapping legal issues and raise rulemaking challenges
to related regulations, we address all four companion cases
in this single opinion.
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19-1600 and 19-1680, and we dismiss the remaining two
petitions in Appeal Nos. 19-1685 and 19-1687 in their entirety.
BACKGROUND
I
Congress enacted the AMA in 2017 to reform the existing
VA administrative appeals system, which was, by all
accounts, “broken,” marked by lengthy delays, and plagued
with a formidable backlog of cases. See H.R. Rep. No. 115–
135, at 5–8 (2017) (“The current backlog for appeals exceeds
470,000 claims and is growing.”). Under the previous
appeals system, often described as the “legacy system,”2
veteran disability claimants had only one pathway to seek
administrative review of an unsatisfactory initial decision
on their disability claim from the agency of original jurisdiction
(AOJ). This one-size-fits-all-claims pathway was
long and complicated, regardless of the extent or nature of
the claimant’s disagreement with the initial decision.
Claimants initiated an appeal by filing a NOD to the AOJ’s
decision, and after an elaborate set of steps, could have
their claim reviewed by the Board.3
2 The legacy system still applies to claims filed before
the AMA effective date.
3 Specifically, under the legacy system, after a veteran
submits a claim to the VA, that claim is reviewed by
the AOJ, typically one of the Veterans Benefits Administration’s
(VBA) fifty-six regional offices. J.A. 109. The
AOJ’s initial decision decides whether the claimant is entitled
to compensation and, if so, how much. A claimant who
is unsatisfied with that initial decision may initiate an appeal
within one year of the decision’s notification date by
filing a NOD. J.A. 110. After receiving the NOD, the AOJ
reviews the claim again, and if the disagreement cannot be
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More problematic, however, was the “continuous evidence
gathering and readjudication of the same matters”
that caused appeals to “churn” in the system. See S. Rep.
115–126, at 29 (2017) (Jennifer S. Lee, Deputy Under Secretary
for Health and Policy Services) (“Veterans and VA
adjudicators are . . . engaged in continuous evidence gathering
and repeated readjudication of the same appeal. This
cycle of evidence gathering and readjudication means that
appeals often churn for years between the Board and the
[AOJ] to meet complex legal requirements, with little to no
benefit flowing to the Veteran.”). Because the legacy system
permitted claimants to submit new evidence at virtually
any time prior to a final Board decision—including at
the Board hearing—nearly half of the appeals before the
Board resulted in a remand to the AOJ for additional development
and readjudication. The VA, moreover, had a
statutory duty to assist the claimant in obtaining evidence
in support of the appeal throughout the entire appeals process.
The introduction of new evidence at the Board would
resolved, it issues a statement of the case (SOC) setting
forth the agency’s legal and factual position with respect to
the disagreement. Id. The claimant then has sixty days to
file a “[s]ubstantive [a]ppeal” to the Board (and request a
hearing) by filing a form that provides “specific allegations
of error of fact or law . . . related to specific items in the
[SOC].” See § 20.202 (2018). The Board subsequently reviews
the case and can either grant the requested relief,
deny that relief, or remand the case to the AOJ for additional
fact finding and readjudication. J.A. 111. A claimant
dissatisfied with the Board’s final decision may
continue an appeal to the United States Court of Appeals
for Veterans Claims (Veterans Court), and beyond the VA
to our court and even to the Supreme Court. Id. Additionally,
clear and unmistakable error (CUE), see § 5109A, and
new and material evidence, see § 5108 (2016), claims allow
for review of final judgments.
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often result in a remand to the AOJ for readjudication of
the claim in light of that evidence. Collectively, these features
resulted in a protracted administrative appeals system
in which claimants waited “an average [of] five years
for a final decision” from the Board, which was expected to
increase to “an average [of] ten years for a final appeals
decision by the end of 2027.” See H.R. Rep. No. 115–135,
at 5.
As relevant here, the AMA sought to reduce inefficiencies
of the legacy appeals system by introducing several
statutory reforms. These amendments reflect Congress’s
goal of streamlining the administrative appeals system
while still protecting claimants’ due process rights. See id.
(“To help ensure that veterans receive timely appeals decisions
in the future . . . [t]he new appeals procedures created
by this bill would reduce [the] VA’s workload and help
ensure that the process is both timely and fair.”); see also
S. Rep. No. 115–126, at 27 (“[T]he current system allows
for repeated revisions and resubmissions of claims while
maintaining an effective date for benefits based upon the
original filing date of the claim. . . . The proposed changes
are intended to significantly streamline the appeal process,
which would allow appeals to be finalized in a shorter period
of time with fewer employees.”).
Central to the AMA’s many reforms, claimants may
now choose from three procedural lanes to obtain review of
their claim within one year of the initial decision (in contrast
to the legacy system’s single pathway for appeal to
the Board). 38 U.S.C. § 5104C(a)(1). Claimants may use
only one lane at a time. § 5104C(a)(2)(A). Each lane has
varying limitations on the submission of new evidence and
the VA’s duty to assist the claimant in obtaining such evidence.
The first lane is the filing of a supplemental claim,
which allows a claimant to submit additional evidence to
an AOJ for “readjudication” of the claim.
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§§ 5104C(a)(1)(B), 5108. The second lane is a request for
“higher-level review” made within one year of the AOJ’s decision.
§§ 5104B(b)(1)(B), 5104C(a)(1)(A). This lane offers
review of the claim by a higher-level claims adjudicator at
the AOJ that is based on the same evidentiary record as
the initial claim (i.e., the claimant may not submit new evidence),
and the VA has no duty to assist during the review.
§§ 5104B(d), 5103A(e). The third lane is a direct appeal to
the Board,4 which a claimant initiates by filing a NOD
within one year of the AOJ’s initial decision. As with the
legacy appeals system, this lane permits claimants to submit
additional evidence and request a Board hearing, if
they wish. Unlike the legacy system, however, claimants
must specify in the NOD their intention to add to the record
and submit the additional evidence within a certain
time frame (i.e., within 90 days of the NOD’s filing or the
Board hearing). In another departure from the legacy system,
wherein the VA’s duty to assist continued while a
claim was on appeal before the Board, the VA has no duty
to assist during a Board appeal under the AMA’s modified
procedures. § 5103A(e).
Should one lane of review prove unsuccessful, claimants
may sequentially pursue another lane of review while
maintaining the original effective date of the initial claim,
so long as they “continuously pursue” that claim by selecting
an appropriate alternative lane within one year of an
unsatisfactory AOJ, Board, or Veterans Court decision.
§ 5110(a)(2)–(3). But two consequences arise when the
claim is no longer in continuous pursuit—that is, when a
claimant waits more than one year to seek further review
of an unsatisfactory AOJ, Board, or Veterans Court
4 In contrast to legacy Board appeals, this third lane
eliminates “intermediate and duplicative steps . . . such as
the [SOC] and the Substantive Appeal [form].” S. Rep. No.
115–126, at 30.
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decision. First, at that time, claimants can no longer seek
higher-level review or appeal to the Board but can only file
a supplemental claim. See § 5104C(b). And second, any
award under such a supplemental claim is no longer entitled
to the initial claim’s original effective date and will instead
be assigned an effective date tied to the supplemental
claim’s date of receipt. § 5110(a)(3).
II
On August 10, 2018, pursuant to its authority under
38 U.S.C. § 501(a) to “prescribe all rules and regulations
which are necessary or appropriate to carry out the laws
administered by the [agency],” the VA published a notice of
proposed rulemaking in the Federal Register inviting the
public to comment on its proposed rules for implementing
the AMA’s reforms. See VA Claims and Appeals Modernization,
83 Fed. Reg. 39,818 (Aug. 10, 2018) (Proposed Rule).
After receiving comments on the Proposed Rule, the VA
promulgated the Final Rule on January 18, 2019, which
along with the AMA5 became effective on February 19,
2019.
Petitioners subsequently filed four separate petitions
under § 502, collectively raising thirteen rulemaking
5 The amendments under the AMA apply to all
claims for which notice of a decision is provided by the Secretary
on or after the later of: (1) the date that is 540 days
after August 23, 2017, and (2) the date that is 30 days after
the Secretary submits to the appropriate committees of
Congress a certification of required resources and a summary
of performance outcomes. See 131 Stat. at 1115. As
the VA submitted the required documentation to Congress
on January 18, 2019, the effective date of the amendments
made by the AMA was February 19, 2019. The date 540
days after the date of enactment of the AMA was February
14, 2019.
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challenges to the validity of several regulations.6 Specifically,
Mr. Haisley and NVLSP’s petition challenged 38
C.F.R. § 3.105(a)(1)(iv). MVA’s petition also challenged
§ 3.105(a)(1)(iv) in addition to 38 C.F.R. § 14.636(c)(1)(i)
and 38 C.F.R. § 20.202(c)(2). NOVA and PVA’s petition
challenged 38 C.F.R. § 3.155(b), 38 C.F.R. § 3.156(b), 38
C.F.R. § 3.2500(b), and 38 C.F.R. § 3.2500(d)–(e) and 38
C.F.R. § 20.205(c). And finally, Carpenter Chartered’s petition
raised all but three of the above challenges
(§ 3.105(a)(1)(iv),7 § 3.2500(d)–(e) and § 20.205(c), and
§ 14.636(c)(1)(i)) and further raised six additional challenges,
to: 38 C.F.R. § 3.1(p)(1)–(2), 38 C.F.R. § 3.103(c)(2),
38 C.F.R. § 3.151(c)(1)–(2), 38 C.F.R. § 14.636(c)(2)–(3), 38
C.F.R. § 20.202(a), and 38 C.F.R. § 20.800(e).
The government’s opening briefs opposed only
NVLSP’s and Carpenter Chartered’s standing to challenge
the implementing regulations. However, pursuant to our
independent duty to verify standing, we requested supplemental
briefing from each Petitioner to address “the precise
grounds upon which it asserts standing to make each
of the specific challenges raised by the petition.” See, e.g.,
Order Requesting Suppl. Briefing, No. 19-1600 (Sept. 16,
2020), ECF No. 55, at 1–2. Specifically, we asked
6 The Petitioners presented the thirteen challenges
as follows: (1) 38 C.F.R. § 3.1(p)(1)–(2); (2) 38 C.F.R.
§ 3.103(c)(2); (3) 38 C.F.R. § 3.105(a)(1)(iv); (4) 38 C.F.R.
§ 3.151(c)(1)–(2); (5) 38 C.F.R. § 3.155; (6) 38 C.F.R.
§ 3.156(b); (7) 38 C.F.R. § 3.2500(b); (8) 38 C.F.R. § 3.2500
(d)–(e) and 38 C.F.R. § 20.205(c); (9) 38 C.F.R.
§ 14.636(c)(1)(i); (10) 38 C.F.R. § 14.636(c)(2)–(3); (11) 38
C.F.R. § 20.202(a); (12) 38 C.F.R. § 20.202(c)(2); and (13) 38
C.F.R. § 20.800(e).
7 Shortly before oral argument, Carpenter Chartered
withdrew its challenge to § 3.105(a)(1)(iv). Petitioner’s
Notice, No. 19-1685 (Sept. 25, 2020), ECF No. 52.
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Petitioners to demonstrate the “actual or imminent injuries
in fact, which are (a) concrete and particularized, and
(b) traceable to a specific regulation” being challenged. Id.
at 2. We also requested briefing on issues specific to the
precise theory of standing asserted. See, e.g., id. (requesting
each Petitioner relying on associational standing to
“demonstrate that they have a member that would otherwise
have personal standing to challenge the specific regulations”).
We have jurisdiction under § 502 to “directly review the
validity of both the rulemaking process and the challenged
VA regulations” in the Final Rule. See Paralyzed Veterans
of Am. v. Sec’y of Veterans Affs., 345 F.3d 1334, 1339 (Fed.
Cir. 2003).
DISCUSSION
I. Standing
Before reaching the merits of Petitioners’ challenges,
we must first satisfy our “independent obligation to assure
that standing exists, regardless of whether it is challenged
by any of the parties.” Summers v. Earth Island Inst., 555
U.S. 488, 499 (2009). “[S]tanding is an essential and unchanging
part of the case-or-controversy requirement of
Article III.” Lujan v. Defs. of Wildlife, 504 U.S. 555, 560
(1992). This obligation to assure standing extends to when
a party seeks judicial review of final agency action, as Petitioners
do here.
The “irreducible constitutional minimum of standing”
consists of three elements. Id. First, a plaintiff must personally
present an “injury in fact,” meaning “an invasion of
a legally protected interest which is (a) concrete and particularized,
and (b) actual or imminent, not conjectural or
hypothetical.” See id. (cleaned up). This requirement ensures
that the plaintiff has a “personal stake in the outcome
of the controversy.” Warth v. Seldin, 422 U.S. 490,
498 (1975). Second, there must be a causal connection
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between the injury and the conduct complained of—that is,
plaintiff’s injury must be “fairly traceable” to the challenged
“putatively illegal conduct of the defendant,” and
not the result of independent action of some third party not
before the court. See Valley Forge Christian Coll. v. Ams.
United for Separation of Church & State, Inc., 454 U.S.
464, 472 (1982); see also California v. Texas, 141 S. Ct.
2104, 2113–15 (2021) (no causation where plaintiffs’ injury—
cost of purchasing health insurance—is not “fairly
traceable” to any “allegedly unlawful [government] conduct”
because the challenged Patient Protection and Affordable
Care Act (ACA) provision mandating health
insurance coverage was rendered “unenforceable” upon
elimination of the tax penalty for noncoverage). Lastly, it
must be “likely” that the injury will be redressable by the
requested relief. Lujan, 504 U.S. at 561; see also California,
141 S. Ct. at 2116 (no standing to challenge unenforceable
ACA provision where plaintiffs sought only a
declaratory judgment that provision is unconstitutional,
which, by itself, is not an “acceptable Article III remedy”
that can “redress a cognizable Article III injury”).
Petitioners bear the burden of establishing these elements
under the same standard that is applied at the summary
judgment stage. See Phigenix, Inc. v. Immunogen,
Inc., 845 F.3d 1168, 1172–73 (Fed. Cir. 2017) (adopting the
summary judgment burden of production in cases challenging
final agency action). In other words, instead of resting
on “mere allegations,” a plaintiff must set forth by affidavit
or other evidence “specific facts” to adequately support its
contentions. See Lujan, 504 U.S. at 561 (quoting Fed. R.
Civ. P. 56(e)).
With respect to injury in fact, the Supreme Court has
cautioned that “‘some day’ intentions—without any description
of concrete plans, or indeed even any specification
of when the ‘some day’ will be—do not support a finding
of . . . actual or imminent injury.” Lujan, 504 U.S. at 564
(cleaned up) (no actual or imminent injury where affiants
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merely professed intent to visit endangered species without
concrete plans to do so). Nor can generalized allegations of
harm untethered to the “application of the challenged regulations”
establish a “concrete and particularized” injury.
See Summers, 555 U.S. at 495 (no standing where harm
alleged was “not tied to application of the challenged regulations”
and did not identify a particular project subject to
the challenged regulations that would impede petitioner’s
specific and concrete interests); see also Lujan, 504 U.S. at
566–67 (“pure speculation and fantasy” or an “ingenious
academic exercise in the conceivable” is insufficient to establish
injury for standing).
Plaintiffs claiming standing to challenge the validity of
a statute or regulation must generally assert an injury that
is caused by that statute’s or regulation’s “actual or threatened
enforcement, whether today or in the future.” California,
141 S. Ct. at 2114. Where, as here, plaintiffs seek preenforcement
review, the Supreme Court has required
plaintiffs to show that “the likelihood of future enforcement
is ‘substantial.’” Id. In other words, while a plaintiff need
not “await the consummation of threatened injury to obtain
preventive relief,” it must demonstrate “a realistic danger
of sustaining a direct injury as a result of the statute’s operation
or enforcement” or show that the injury is “certainly
impending.” Biotechnology Indus. Org. v. District of
Columbia, 496 F.3d 1362, 1370 (Fed. Cir. 2007) (citing Babbitt
v. United Farm Workers Nat’l Union, 442 U.S. 289, 298
(1979)); see also Massachusetts v. Mellon, 262 U.S. 447, 488
(1923) (plaintiff must demonstrate that “he has sustained
or is immediately in danger of sustaining some direct injury
as the result of its enforcement”); Clapper v. Amnesty
Int’l USA, 568 U.S. 398, 409, 414 n.5 (2013) (allegation of
future injury may suffice if threatened injury is “certainly
impending” or there is a “substantial risk” the harm will
occur).
We now turn to Petitioners’ thirteen rulemaking challenges.
All but two of these challenges address regulatory
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provisions concerning procedural and substantive requirements
for obtaining VA benefits—involving, e.g., initial
claims, administrative review, and CUE claims. The remaining
two challenges involve regulatory provisions governing
attorneys’ fees for representing claimants in VA
proceedings.
Petitioners consist of several veterans’ service organizations,
a law firm, and an individual. Collectively, they
assert numerous theories of associational standing (on behalf
of both veteran and attorney members), organizational
standing, third-party standing, and personal standing. We
address each in turn.
A. Associational Standing
MVA, NOVA, and PVA (collectively, the Associations)
claim associational standing on behalf of their members,
which requires an Association to demonstrate that “(a) its
members would otherwise have standing to sue in their
own right; (b) the interests it seeks to protect are germane
to the [Association’s] purpose; and (c) neither the claim asserted
nor the relief requested requires the participation of
individual members in the lawsuit.” Hunt v. Wash. State
Apple Advert. Comm’n, 432 U.S. 333, 343 (1977). The Associations
assert different theories of associational standing
on behalf of both their veteran members and their
attorney members.
We note, as an initial matter, that as to Hunt’s second
and third prongs, the parties’ only dispute is whether
NOVA (and no other Petitioner) satisfies the second prong
of associational standing—i.e., whether the interests
NOVA seeks to protect are germane to its purpose. The
government argues that NOVA’s petition is not germane to
the purposes enumerated in its bylaws, which are focused
on ensuring that its members, as advocates, offer informed
representation to veterans seeking benefits from the VA.
Resp’t Suppl. Br. (No. 19-1680) at 12–13. This court, however,
recently resolved this dispute in NOVA’s favor in
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National Organization of Veterans’ Advocates, Inc. v. Secretary
of Veterans Affairs, where we explained that NOVA’s
purpose is not as narrow as the government contends and
more generally relates to “helping veterans obtain fair compensation
for their claims”—which is “precisely the interest
NOVA now seeks to protect in challenging” these rules.
981 F.3d 1360, 1371 (Fed. Cir. 2020) (en banc) (NOVA). Accordingly,
we conclude that the Associations satisfy the second
and third prongs of associational standing. Below, we
address only Hunt’s first prong as to the Associations’ veteran
and attorney members.
- Hunt’s First Prong: Veteran Members
The Associations make six rulemaking challenges8 asserting
associational standing on behalf of their veteran
members, relying on Disabled American Veterans v. Gober,
234 F.3d 682 (Fed. Cir. 2000) (DAV). DAV held, in relevant
part, that petitioner NOVA had satisfied Hunt’s first prong
of associational standing because “NOVA includes at least
one veteran as a member,” and all veterans are “personally
affected by the [challenged] rules,” which impact their abilities
to bring CUE claims. See id. at 689. Notably, DAV
did not require NOVA to identify a specific veteran member
that presented an injury that is actual or imminent, concrete,
particularized, and fairly traceable to the challenged
CUE rules.
Shortly after oral argument occurred in this case, however,
this court, sitting en banc in NOVA, partially overruled
DAV insofar as “it held that [standing] can be
8 (1) § 3.105(a)(1)(iv); (2) § 20.202(c)(2); (3)
§ 3.2500(b); (4) § 3.2500 (d)–(e) and § 20.205(c); (5) § 3.155;
and (6) § 3.156(b). The Associations assert associational
standing to challenge § 14.636(c)(1)(i) only on behalf of
their attorney members, discussed infra, not their veteran
members.
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established solely on the basis of NOVA member veteran
status without identification of an individual affected
member, the nature of [the] claimed injury, and the reasons
that the challenged interpretive rule would adversely
affect [that] member.” 981 F.3d at 1369. Instead, an organization
challenging VA rulemaking based on associational
standing must show that it has at least one veteran
member with an actual or potential claim that could be affected
by the challenged rule. See id. at 1369–70.
As applied here, we begin our associational standing
analysis by asking whether at least one Association has at
least one veteran member with an actual or potential claim
that could be affected by the challenged rules at issue. In
response to our request for supplemental briefing on this
issue, the Associations submitted evidence in the form of
signed declarations by some of their members. For the reasons
below, we conclude that PVA has met its burden as to
Hunt’s first prong for only two of the six rulemaking challenges.
First, § 3.2500(b) bars claimants from filing a supplemental
claim based on new and relevant evidence while judicial
review of their initial claim is pending on appeal in
federal court. Clarence Noble, a PVA member and veteran,
appealed the denial of his initial benefits claim to federal
court, and while that appeal was pending, received new
and relevant evidence he sought to submit in a supplemental
claim. Under § 3.2500(b), however, Mr. Noble was
barred from filing a supplemental claim because of his
pending judicial appeal, thereby preventing him from
timely applying for (and receiving) benefits based on this
new evidence.
Second, § 3.155 excludes supplemental claims from the
intent-to-file framework, which, by contrast, continues to
apply to initial claims. Under this rule, a claimant filing a
supplemental claim cannot rely on a preliminary submission
to serve as an effective date placeholder. Stephen C.
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Schwenker, a PVA member and veteran of the United
States Air Force, submitted his intent to file a supplemental
claim, which the VA received on July 24, 2018.
Mr. Schwenker believed he had one year from that date to
gather the evidence necessary to demonstrate service-connection
for his multiple sclerosis claim. While he was eventually
awarded service-connection, the effective date of his
award was September 17, 2019 (presumably, the day his
formal supplemental claim was received), rather than July
24, 2018. Section 3.155 thus deprived him of an earlier effective
date (and, as a result, additional benefits) based on
the date of his intent-to-file submission.
Accordingly, we conclude that the facts alleged as to
Mr. Noble and Mr. Schwenker establish that these PVA
veteran members suffered an injury in fact that is fairly
traceable to the alleged shortcomings of the challenged regulations,
see Spokeo, Inc. v. Robins, 136 S. Ct. 1540, 1547
(2016), and as a result, PVA has associational standing on
behalf of its veteran members to challenge § 3.2500(b) and
§ 3.155, see NOVA, 981 F.3d at 1370. Moreover, this evidence
is in the form of signed member declarations setting
forth specific facts, which is sufficient to meet the summary
judgment burden of production applied to direct challenges
of agency action. See id. (citing Phigenix, 845 F.3d at 1172–
73, and Lujan, 504 U.S. at 561).
By contrast, the allegations pertaining to the four remaining
challenges are too vague or speculative to establish
an injury in fact. The allegations with respect to
§ 20.202(c)(2) and § 3.156(b), for example, fail to identify
any particular veteran member who has presented an actual
or imminent harm as a result of these regulations.
NOVA and PVA also challenge § 3.2500(d)–(e) and
§ 20.205(c), which collectively limit a claimant’s options for
switching administrative review lanes more than a year after
the initial decision. But the declarants merely allege
that they are currently pursuing one form of administrative
review and speculate that they may want to switch to
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another lane of administrative review at some point in the
future. While standing may be predicated on future harm,
these declarations express nothing more than “‘some day’
intentions,” which fail to demonstrate that a particular veteran
member faces “actual or imminent injury” if foreclosed
from switching lanes after one year. See Lujan, 504 U.S.
at 564.
Lastly, MVA challenges § 3.105(a)(1)(iv), which precludes
a change in law (e.g., a change in the interpretation
of a statute) from serving as the basis for a CUE claim. The
only affected veteran member MVA specifically identifies
is Michael Hodge, who is a Blue Water Navy veteran. Such
veterans were previously ineligible for benefits based on a
statutory interpretation that was later overturned in Procopio
v. Wilkie, 913 F.3d 1371 (Fed. Cir. 2019) (en banc).
Based on this new statutory interpretation, Mr. Hodge
filed a CUE claim seeking revision of the pre-Procopio VA
decision that denied his original claim for benefits in 2010.
But the VA, citing § 3.105(a)(1)(iv), purportedly disregarded
Mr. Hodge’s CUE claim and, instead, required him
to file a supplemental claim. One difference between a supplemental
claim and a CUE claim pertains to the claim’s
original effective date: While a successful CUE claim provides
benefits retroactive to the effective date of the claimant’s
original claim, a supplemental claim filed more than
one year after the initial decision generally provides no retroactive
benefits and is effective only as of the date the supplemental
claim itself is filed. See § 5110(a)(3).
But as MVA concedes, Congress has already provided
Blue Water Navy veterans with the relief they would have
obtained had their CUE claim been allowed to proceed. See
Pet’r Suppl. Br. (No. 19-1600) at 4 n.1. The Blue Water
Navy Vietnam Veterans Act, Pub. L. No. 116–23, 133 Stat.
966 (2019) (codified at scattered sections of 38 U.S.C.), allows
such veterans to receive retroactive effective dates for
finally denied claims reconsidered and granted under the
new law. Because the Act provides Blue Water Navy
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veterans with the same benefits that they otherwise would
have received under the CUE pathway, we discern that as
to Mr. Hodge, MVA failed to sufficiently present an actual
or imminent harm fairly traceable to § 3.105(a)(1)(iv). We
therefore conclude that Mr. Hodge lacks personal standing
to challenge this regulation, and MVA cannot claim associational
standing on his behalf. - Hunt’s First Prong: On Behalf of Attorney Members
The Associations also claim associational standing on
behalf of their attorney members to make two sets of rulemaking
challenges: the same six challenges to rules governing
a veteran’s claim for benefits addressed in the
previous section (supra § I.A.1), and a challenge to
§ 14.636(c)(1)(i), which limits when attorneys’ fees may be
charged for work on veterans’ benefits proceedings. Because
we have previously concluded that PVA has standing
on behalf of its veteran members to make two of these challenges
(the challenges to § 3.2500(b) and § 3.155), we only
address the Associations’ arguments as to the remaining
four challenges, to: (1) § 3.105(a)(1)(iv); (2) § 20.202(c)(2);
(3) § 3.2500 (d)–(e) and § 20.205(c); and (4) § 3.156(b). We
also address the Associations’ arguments as to
§ 14.636(c)(1)(i).
With respect to the four challenges addressed above,
the Associations argue that their attorney members are injured
because these rules make it more difficult for their
veteran clients to obtain benefits, which, in turn, “diminish[
es] the contingency fees [attorneys] will be able to earn”
under such rules. Pet’rs Suppl. Br. (No. 19-1680) at 8. The
Associations contend that both this court and the Supreme
Court have already recognized that “these sorts of direct
economic injuries to lawyers are adequate injury in fact to
meet the constitutional minimum of Article III standing.”
Id. at 11 (citing Caplin & Drysdale, Chartered v. United
States, 491 U.S. 617, 623 n.3 (1989); Kowalski v. Tesmer,
543 U.S. 125, 129 n.2 (2004); and Willis v. Gov’t
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Accountability Off., 448 F.3d 1341, 1348 (Fed. Cir. 2006)).
For the reasons below, we decline to find the Associations
have associational standing on behalf of their attorney
members to make these four challenges, which concern the
benefits that claimants can receive and not the contingency
fees that their attorneys can recover.
As an initial matter, all three of the Associations’ cited
cases involve third-party standing, and not associational
standing. In third-party standing, an attorney seeks to assert
a legal right belonging to a third party—i.e., the attorney’s
client—based on a close attorney-client relationship
and the client’s inability to assert its own rights. See Kowalski,
543 U.S. at 130. The Associations’ proposed theory
of associational standing, on the other hand, purports to
assert a legal right to fees belonging to their attorney members,
such that those members “would otherwise have
standing to sue in their own right.” See Hunt, 432 U.S. at - We are unaware of any binding authority recognizing
that attorneys have a “legally protected interest” in safeguarding
their fees against regulations that govern a client’s
benefits claim; nor have we seen a case holding that
attorneys personally have standing to challenge such regulations
in their own right. To decide otherwise would lead
to the peculiar conclusion that an attorney has personal
standing (and the service organization to which the attorney
belongs has associational standing) to raise a rulemaking
challenge whenever an agency promulgates a
regulation that could negatively impact a client’s ability to
obtain benefits.
Even setting aside the fundamental distinctions between
third-party standing and associational standing, the
Associations’ cited cases are readily distinguishable. Both
Caplin and Willis, for instance, emphasize the petitioner’s
certainty of recovery in establishing injury in fact based on
attorneys’ fees. Caplin concluded that a law firm asserting
third-party standing on behalf of its client had established
an injury in fact fairly traceable to the challenged action
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because the action prevented the firm from collecting a fee
to which it was “almost certainly” entitled. See 491 U.S. at
623 n.3 (“[T]here can be little doubt that petitioner’s stake
in $170,000 of the forfeited assets—which it would almost
certainly receive if the Sixth Amendment claim it advances
here were vindicated—is adequate injury in fact to meet
the constitutional minimum of Article III standing.”).
Likewise, in Willis, the outcome of the proceedings had already
been adjudicated in the client’s favor, and the attorney
was undisputedly entitled to fees as a result. See 448
F.3d at 1348. This certainty is especially important where,
as here, “[petitioner] is not himself the object of the government
action . . . he challenges” because standing is “substantially
more difficult to establish.” Lujan, 504 U.S. at
561–62. Under such circumstances, standing hinges on the
“unfettered choices made by independent actors not before
the courts and whose exercise of broad and legitimate discretion
the courts cannot presume either to control or to
predict.” Id. at 562. Petitioners, then, bear the burden to
“adduce facts showing that those choices have been or will
be made in such a manner as to produce causation and permit
redressability of injury.” Id.
Here, however, the Associations’ allegations lack the
certainty of recovery demonstrated in Caplin and Willis
and, instead, are based on mere speculation that the challenged
rules will preclude their clients from obtaining benefits
that they otherwise could have filed for and might
have been awarded, which, in turn, would “diminish” their
contingency fees. NOVA and PVA, for instance, challenge
§ 3.156(b)—which governs the submission of new and material
evidence while a claim is pending under the legacy
system—yet fail to identify a single attorney member with
a client subject to this rule, let alone a concrete and specific
set of circumstances that would lead to diminished fees.
See Pet’rs Suppl. Br. (No. 19-1680) at 10 (“[S]ome NOVA
members reasonably expect to represent veterans harmed
by the elimination of effective date protection for such
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evidence.” (emphasis added)). MVA challenges
§ 20.202(c)(2) but, at most, asserts that this rule has dissuaded
its attorneys from taking on clients they feel are
likely to receive denials. See Pet’r Suppl. Br. (No. 19-1600)
at Tab 3, Decl. of Robin Hood ¶ 4 (asserting that
§ 20.202(c)(2) has caused him to “turn down [claimants]
that [have] chosen a [Board] lane that does not let them
adequately develop their claim and [are] foreclosed
. . . from amending their choice” because the “claimant
will most likely get a denial and [he] won’t be able to
earn any fees on a denial”). Similarly, for § 3.2500(d)–(e)
and § 20.205(c), which limit switching of administrative review
options after one year, NOVA and PVA allege that an
attorney member represents a client who originally selected
one lane but, because of this rule, is unable to switch
into a potentially faster lane without losing his effective
date. See Pet’rs Suppl. Br. (No. 19-1680) at Tab 3, Decl. of
Robert Chisholm ¶ 8. But these alleged facts fail to establish
that the rule presents a concrete threat of diminished
attorneys’ fees and, at best, merely indicate a possible delay
in when the client receives benefits. Accordingly, even
if diminished attorneys’ fees can suffice as an injury in fact
in some instances, the Associations’ allegations as to these
challenged regulations are simply too speculative.
As for § 3.105(a)(1)(iv), which excludes a change in judicial
interpretation as a basis for CUE, MVA contends
that this rule precludes its Blue Water Navy veteran clients
from filing Procopio-based CUE claims, leaving them
with only supplemental claims as a route for administrative
review. This purportedly harms its attorneys because
§ 14.636 precludes them from recovering any fees for the
majority (if not all) of their work on such supplemental
claims. See Pet’r Suppl. Br. (No. 19-1600) at Tab 1, Decl.
of John B. Wells ¶ 7. We decline to subscribe to this theory
of standing for several reasons. As a threshold matter, we
recently addressed and rejected a similar challenge to the
validity of this regulation in George v. McDonough, 991
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F.3d 1227 (Fed. Cir. 2021) (holding that CUE cannot arise
from a subsequent change in interpretation of law by the
agency or judiciary). Having already resolved the merits of
MVA’s challenge to § 3.105(a)(1)(iv), we decline to hold that
it has standing based on a potential loss of attorneys’ fees,
given that “an ‘interest in [attorneys’] fees is insufficient to
create an Article III case[-]or[-]controversy where none exists
on the merits of the underlying claim.’” See Thole v.
U.S. Bank N.A., 140 S. Ct. 1615, 1619 (2020) (quoting
Lewis v. Cont’l Bank Corp., 494 U.S. 472, 480 (1990)); see
also Vermont Agency of Nat. Res. v. United States ex rel.
Stevens, 529 U.S. 765, 773 (2000) (“[A]n interest that is
merely a ‘byproduct’ of the suit itself cannot give rise to a
cognizable injury in fact for Article III standing purposes.”).
We also observe that MVA’s alleged injury to its
attorneys’ ability to recover fees for supplemental claims is
not directly caused by § 3.105(a)(1)(iv) but rather § 14.636,
which MVA also challenges. Thus, even assuming that
MVA has established a concrete injury in fact, it has nonetheless
failed to demonstrate that this injury is “directly
traceable” to the specific rule being challenged. See California,
141 S. Ct. at 2117; see also Summers, 555 U.S. at
495 (no standing where harm alleged was “not tied to application
of the challenged regulations”).
Moreover, far from approving the fee-based theory of
injury that the Associations advance here, Kowalski carefully
“assume[d], without deciding” that petitioners’ allegations
regarding economic injury as to their diminished fees
were “sufficient” to demonstrate injury in fact. See 543
U.S. at 129 n.2 (emphasis added); id. at 129 (“In this case,
we do not focus on the constitutional minimum of standing,
which flows from Article III’s case-or-controversy requirement.
Instead, we shall assume the attorneys have satisfied
Article III and address the alternative threshold
question whether they have standing to raise the rights of
others.” (cleaned up)). Accordingly, the Associations’ cited
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cases fail to support standing on behalf of their attorney
members.9
Lastly, we address MVA’s claimed standing to challenge
§ 14.636(c)(1)(i). Unlike the other four challenges at
issue, this rule directly affects attorneys’ fees—by restricting
fees for work performed on supplemental claims filed
more than a year after the initial decision, but not for any
other type of claim. Looking to the specific facts alleged,
we find them sufficient to establish constitutional standing.
Specifically, John B. Wells, an MVA member and attorney,
alleges that, under this rule, he personally was
denied “over $50,000 in fees . . . for work [performed on] a
supplemental claim older than one year.” We thus hold
9 Even if we were to conclude that the Associations
have constitutional standing to challenge these regulations
on behalf of their attorney members, we are skeptical that
these members would fall within the class whom Congress
has authorized to seek review under the Administrative
Procedure Act (APA). See Lexmark Int’l, Inc. v. Static Control
Components, Inc., 572 U.S. 118, 127 (2014) (clarifying
that the zone-of-interests analysis asks the statutory question
of whether a “legislatively conferred cause of action encompasses
a particular plaintiff’s claim”). While the zoneof-
interests test is not especially demanding, the Associations’
grievance of diminished attorneys’ fees appears to be
“so marginally related to or inconsistent with the purposes
implicit in the statute that it cannot reasonably be assumed
that Congress intended to permit the suit.” Clarke
v. Sec. Indus. Ass’n, 479 U.S. 388, 399–400 (1987). Nothing
in the relevant AMA statutory provisions speaks to or even
suggests that Congress intended to authorize attorneys to
challenge these rules to protect their fees; instead, these
provisions were “obviously enacted to protect the interests
of” veterans and the VA itself, not attorneys. See Lujan v.
Nat’l Wildlife Fed’n, 497 U.S. 871, 883 (1990).
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that MVA has associational standing on behalf of its attorney
members to challenge the validity of this regulation.
B. Organizational Standing
Petitioners NVLSP, MVA, NOVA, and PVA (collectively,
the Organizations) next claim that they have organizational
standing in their own right (and not on behalf of
their members) to make the seven rulemaking challenges
discussed above. Because we previously concluded that
PVA and MVA collectively have standing to make three of
these challenges, we only address the Organizations’ arguments
as to the remaining four challenges, to: (1)
§ 3.105(a)(1)(iv); (2) § 20.202(c)(2); (3) § 3.2500 (d)–(e) and
§ 20.205(c); and (4) § 3.156(b).
Organizational standing, like any other theory of
standing, requires an Organization to demonstrate the
three elements of injury in fact, causation, and redressability.
See Friends of the Earth, Inc. v. Laidlaw Env’t Servs.
(TOC), Inc., 528 U.S. 167, 180–81 (2000). To prove an injury
in fact, an Organization must establish a “concrete and
demonstrable injury to the [O]rganization’s activities”—
such as a “perceptibl[e] impair[ment]” of the Organization’s
mission—“with the consequent drain on the [O]rganization’s
resources.” See Havens Realty Corp. v. Coleman, 455
U.S. 363, 379 (1982).
In the present case, the Organizations claim that the
challenged rules purportedly make it more difficult for veterans
to obtain benefits, thereby frustrating the Organizations’
general purpose of helping veterans obtain benefits
and draining their resources on educational guidance. We
conclude that this asserted harm does not satisfy the Havens
standard for organizational standing.
Demonstrating a concrete organizational injury requires
more than showing a “setback to [an] organization’s
abstract social interests.” Id. at 379. The injury thus cannot
be merely ideological, meaning that damage to the
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“special interest” of an organization does not qualify as an
injury in fact; otherwise, “there would appear to be no objective
basis upon which to disallow a suit by any other
bona fide ‘special interest’ organization, however small or
short-lived.” Sierra Club v. Morton, 405 U.S. 727, 738
(1972); see also Food & Water Watch, Inc. v. Vilsack, 808
F.3d 905, 919 (D.C. Cir. 2015) (FWW) (“An organization
must allege more than a frustration of its purpose because
frustration of an organization’s objectives ‘is the type of abstract
concern that does not impart standing.’” (quoting
Nat’l Taxpayers Union, Inc. v. United States, 68 F.3d 1428,
1433 (D.C. Cir. 1995))).
As our sister court, the D.C. Circuit, has explained, allegations
that “the defendant’s conduct perceptibly impaired
the organization’s ability to provide services,” such
as when “the defendant’s conduct causes an ‘inhibition of
[the organization’s] daily operations,’” suffice to establish a
concrete injury to an organization’s interest. FWW, 808
F.3d at 919 (quoting PETA v. U.S. Dep’t of Agric., 797 F.3d
1087, 1094 (D.C. Cir. 2015)). Moreover, the consequent
“drain” on resources must go beyond normal operating
costs—that is, an organization does not suffer an injury in
fact where it “expend[s] resources to educate its members
and others” unless doing so subjects the organization to
“operational costs beyond those normally expended.” Nat’l
Taxpayers Union, 68 F.3d at 1434; see also Nat’l Ass’n of
Home Builders v. EPA, 667 F.3d 6, 12 (D.C. Cir. 2011) (organization’s
expenditures must be for “operational costs beyond
those normally expended to carry out its advocacy
mission”). An organization’s use of resources for litigation,
investigation in anticipation of litigation, or advocacy are
likewise insufficient to give rise to an Article III injury.
FWW, 808 F.3d at 919.
Havens itself is instructive on this point. There, the
organization’s (HOME) purpose was to provide clients with
equal opportunity housing opportunities and information,
pursuant to a federal law that provided a legal right to
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truthful, nondiscriminatory housing information. HOME
claimed organizational injury when a real estate company,
Havens Realty, engaged in unlawful racial steering practices,
which directly unraveled and frustrated HOME’s
nondiscriminatory counseling and referral services, requiring
it to expend additional resources to counteract Havens
Realty’s misinformation. 455 U.S. at 379; see also PETA,
797 F.3d at 1100 (Millett, J., dubitante) (“Put simply, what
HOME used its own resources, information, and client base
to build up, Havens Realty’s racist lies tore down. That is
the type of direct, concrete, and immediate injury that Article
III recognizes.”).
Here, the Organizations’ allegations are insufficient to
satisfy the Havens test. What the Organizations describe
falls short of a “perceptibl[e] impair[ment]” to their conduct
of daily operations or to advancing their purpose and mission
of providing services. The challenged rules, as discussed,
merely seek to streamline procedures for filing and
obtaining administrative review of benefits claims, not directly
foreclose claimants from obtaining benefits; nor can
it be argued that these rules impair or unwind the Organizations’
efforts in counseling and representing veterans in
the benefits process (or otherwise block the Organizations’
efforts to carry out their missions). As for the purported
drain on the Organizations’ resources, expenditures on educational
programs to inform veterans of the governing
regulatory provisions are merely part of the ordinary
course of the Organizations’ operations. For these reasons,
we decline to conclude that NVLSP, MVA, NOVA, and PVA
have organizational standing to challenge these rules.
C. Third-Party Standing and Personal Standing - Mr. Haisley and NVLSP
Mr. Haisley and NVLSP filed a joint petition challenging
the validity of a single regulation, § 3.105(a)(1)(iv), pertaining
to the scope of CUE. Mr. Haisley argues that he
has personal standing to challenge this regulation as a
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Blue Water Navy veteran. We already addressed and rejected
this argument with respect to MVA’s challenge to
this same regulation, and we do so again here.
Mr. Haisley also separately argues personal standing
based on his plans to allege CUE with respect to the Regional
Office’s decision on his claim for prostate cancer.
Specifically, he contends that he was initially awarded a
100% disability rating for this claim in June 2016 while he
had “active malignancy,” which was then lowered to 20%
in March 2020 after he had completed cancer treatment
and was left with “residual complications of prostate cancer.”
See Pet’rs Suppl. Br. (No. 19-1687) at Tab 1, Decl. of
Phillip B. Haisley ¶ 3. We decline to find standing on these
facts. When Mr. Haisley’s declaration was filed, the ratings
decision lowering his disability rating to 20% was still
nonfinal. We find it difficult to understand why Mr. Haisley
would purportedly let that decision become final to pursue
a CUE claim, instead of timely initiating
administrative review within one year based on the alleged
error. Second, and more importantly, based on the specific
facts alleged, if Mr. Haisley were to file a CUE claim, it appears
that it would be based on an erroneous application of
the ratings schedule, and not a change in judicial interpretation
as addressed by § 3.105(a)(1)(iv). For these reasons,
we conclude that Mr. Haisley fails to establish personal
standing to challenge this regulation.
Next, NVLSP argues that it has third-party standing
to challenge the CUE regulation. Third-party standing requires
a Petitioner to demonstrate that (1) it has suffered
an injury in fact giving it a sufficiently concrete interest in
the outcome of the issue in dispute and otherwise satisfies
Article III’s case-or-controversy requirement; (2) it has a
“close” relationship with the third party that possesses the
right being asserted; and (3) there exists some “hindrance’’
to that third party’s ability to protect its own interests.
Kowalski, 543 U.S. at 130. Here, NVLSP alleges it has
third-party standing because it “currently represents”
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unnamed veterans before the Veterans Court “who seek review
of a [Board] decision that rejected the argument that
the challenged final agency decision contains CUE.” See
Pet’rs Suppl. Br. (No. 19-1687) at Tab 2, Decl. of Barton F.
Stichman ¶ 5. We disagree.
NVLSP does not identify a single veteran with whom it
has a close relationship who has had the CUE rule applied
to them, or who has an imminent, “substantial risk” of having
the rule applied to them. Nor do NVLSP’s allegations
specify if the CUE argument these veterans seek to advance
is premised on a change in judicial interpretation, as
specified in the challenged regulation. But even aside from
these issues, it is unclear what injury in fact NVLSP suffers
that shows it has a personal stake in the outcome of a
challenge to this regulation. NVLSP first relies on organizational
injury—an argument which we have already considered
and rejected above. Next, citing United States
Department of Labor v. Triplett, 494 U.S. 715 (1990),
NVLSP argues that advocates have standing to challenge
restrictions preventing them from pursuing desired relationships
with claimants and, here, the CUE rule purportedly
restricts its ability to represent certain veterans
whose claims are excluded from the scope of CUE. Pet’rs
Suppl. Br. (No. 19-1687) at 8–9. But Triplett (and similar
cases in this line) addressed enforcement of a fee restriction
statute that applies directly “against the litigant [i.e., advocate]”
and “prevents a third party from entering into a
relationship with the litigant . . . , to which relationship
the third party has a legal entitlement,” i.e., “due process
right to obtain legal representation.” 494 U.S. at 720 (emphasis
added); Kowalski, 543 U.S. at 131 (explaining that
Triplett “falls within that class of cases where we have allowed
standing to litigate the rights of third parties when
enforcement of the challenged restriction against the litigant
would result indirectly in the violation of third parties’
rights”). Here, however, the challenged regulation applies
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to the third-party claimant’s CUE claim, and not to the attorney
or to the attorney’s relationship with the claimant.
Turning to the hindrance prong of third-party standing,
NVLSP argues that claimants face significant obstacles
to bringing suit in their own right due to the difficulties
of navigating the VA administrative system. Pet’rs Suppl.
Br. (No. 19-1687) at 13–14 (citing Rosinski v. Wilkie, 31
Vet. App. 1, 10 (2019)). But the generic obstacle NVLSP
describes would purportedly hinder all veterans from protecting
their interests with respect to any VA regulation
and fails to demonstrate how any of its clients are hindered
from challenging the CUE regulation at issue. Kowalski,
moreover, rejected a similar argument that indigent criminal
defendants are generally hindered from advancing
their own constitutional rights because they are unable to
navigate the appellate process pro se. See 543 U.S. at 132.
While an attorney would be valuable to veterans challenging
the validity of the CUE regulation, we do not think that
the lack of an attorney here is the type of hindrance necessary
to allow another to assert the claimant’s rights, particularly
in view of Kowalski’s finding that even pro se
criminal defendants were not hindered enough for thirdparty
attorney standing. See id.; see also In re Stanley, 9
Vet. App. 203, 213 (1996) (“VA claimants do not face the
type of obstacles to bringing their own challenges that ordinarily
weigh in favor of finding third-party-rights standing.”).
Additionally, NVLSP’s clients appear to have
representation to advance their interests—NVLSP itself. - Carpenter Chartered
Lastly, Carpenter Chartered, a law firm, asserts both
personal standing and third-party standing on behalf of its
clients. Its petition makes all but three of the challenges
addressed above (§ 3.105(a)(1)(iv), § 3.2500(d)–(e) and
§ 20.205(c), and § 14.636(c)(1)(i)), and also raised six additional
challenges, to: § 3.1(p)(1)–(2), § 3.103(c)(2),
§ 3.151(c)(1)–(2), § 14.636(c)(2)–(3), § 20.202(a), and
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§ 20.800(e), mostly pertaining to the procedures and substance
of claim filings and administrative review, with the
exception of § 14.636(c)(2)–(3), which governs attorneys’
fees.
Carpenter Chartered’s theory of personal standing
bears similarities to organizational standing; as a law firm
specializing in VA benefits law, it urges that it should be
treated like a veterans’ service organization. Carpenter
Chartered also cites Rosinski, 31 Vet. App. 1, as purportedly
establishing that law firms may have personal standing
to challenge regulations such as those at issue here. We
decline to conclude that a law firm has personal standing
to challenge these rules for reasons similar to those already
expressed for associational standing on behalf of attorney
members. Carpenter Chartered has failed to establish how
it suffers an injury in fact as a result of the challenged
rules—especially where none of those rules (save for one)
implicates attorneys. The one exception for which we
might have found personal standing is § 14.636(c)(2)–(3),
governing attorneys’ fees for claims assessed under prior
versions of § 5904(c)(1). Carpenter Chartered contends
that § 5904(c)(1) as amended under the AMA must apply
to all claims regardless of when a decision issued, and that
§ 14.636(c)(2)–(3), which limit the applicability of amended
§ 5904(c)(1) to claims with a decision issued on or after the
AMA’s effective date, are invalid. Pet’r Br. (No. 19-1685)
at 42–45. Yet Carpenter Chartered merely alleges by declaration
that these regulations will harm both the firm and
its clients—it fails to point to an example claim in which it,
under its interpretation, could receive retroactive effect or
allege any specific facts demonstrating how this rule may
cause such injury. We therefore decline to find personal
standing here.
Finally, Carpenter Chartered claims that it has thirdparty
standing on behalf of its veteran clients and, to that
end, submits several signed declarations from those clients.
But as we explained for NVLSP’s third-party
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standing argument, we reject this theory for at least the
reason that Carpenter Chartered has failed to establish
that its clients are hindered from bringing suit in their own
right. This rings especially true as each and every one of
Carpenter Chartered’s declarants avers that he is a client
of Carpenter Chartered and would have pursued an action
in his own right, if requested. See, e.g., Pet’r Suppl. Br. (No.
19-1685) at Tab 1, Decl. of Randy B. Bomhoff, Jr. ¶ 3 (“I
would have allowed Carpenter Chartered to have filed this
challenge in my name.”). Accordingly, we also decline to
find third-party standing under these circumstances.
II. Validity of Challenged Regulations
A. Standard of Review
Having determined that Petitioners lack standing to
challenge all but three of the regulations raised in their petitions,
we now turn to the merits of those challenges.
We review petitions under § 502 in accordance with the
APA, as codified in relevant part at 5 U.S.C. § 706. See
Nyeholt v. Sec’y of Veterans Affs., 298 F.3d 1350, 1355 (Fed.
Cir. 2002). Under § 706, we must “hold unlawful and set
aside agency action” we find “arbitrary, capricious, an
abuse of discretion, or otherwise not in accordance with
law.” § 706(2); see also Motor Veh. Mfrs. Ass’n v. State
Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983) (regulation
must be set aside for being arbitrary and capricious where
agency “has relied on factors which Congress has not intended
it to consider, entirely failed to consider an important
aspect of the problem, offered an explanation for
its decision that runs counter to the evidence before the
agency, or is so implausible that it could not be ascribed to
a difference in view or the product of agency expertise”).
Our review of an agency’s interpretation of a statute
that it administers is further governed by the framework
articulated in Chevron U.S.A., Inc. v. Natural Resources
Defense Council, Inc., 467 U.S. 837, 842–43 (1984). See
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Veterans Just. Grp., LLC v. Sec’y of Veterans Affs., 818 F.3d
1336, 1346 (Fed. Cir. 2016) (VJG). Under Chevron, we first
ask “whether Congress has directly spoken to the precise
question at issue.” 467 U.S. at 842. If we conclude that it
has, “that is the end of the matter,” and the only question
remaining is whether the regulation at issue accords with
congressional intent. Id. at 842–43. Under such circumstances,
we “must reject administrative constructions
which are contrary to clear congressional intent,” as ascertained
by the “traditional tools of statutory construction”
and statutory history. Id. at 843 n.9.
If, however, the statute “is silent or ambiguous with respect
to the specific issue, the question for the court is
whether the agency’s answer is based on a permissible construction
of the statute.” Id. at 843. The administering
agency, under these circumstances, is entitled to make a
“reasonable policy choice.” Id. at 845. Because a court may
not simply substitute its own construction of a statutory
provision for an agency’s reasonable interpretation, such
interpretations are afforded “controlling weight unless
they are arbitrary, capricious, or manifestly contrary to the
statute.” Id. at 844 (footnote omitted).
B. Supplemental Claims under the AMA
The three regulations for which we find Petitioners
MVA and PVA have standing to challenge all pertain to one
of the new procedural lanes of AMA review—supplemental
claims. Specifically, (1) § 14.636(c)(1)(i) limits when a veteran’s
representative may charge fees for work on supplemental
claims; (2) § 3.2500(b) bars the filing of a
supplemental claim when adjudication of the same claim is
pending before a federal court; and (3) § 3.155 excludes
supplemental claims from the intent-to-file framework.
Supplemental claims, as mentioned, permit a claimant to
request readjudication of an initial claim based on “new
and relevant evidence.” § 5108(a). Under the AMA, such
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claims have replaced claims to reopen from the legacy system.
Compare § 5108 (2016), with § 5108 (2019).
Several statutory provisions form the basis for the regulations
at issue here. First, § 5104C(a) and § 5104C(b) recite
a claimant’s options for administrative review
following an AOJ decision, including the filing of a supplemental
claim. Section 5104C(a) governs administrative review
“within one year” of an AOJ decision, whereas
§ 5104C(b) governs administrative review after “more than
one year has passed.”10
10 38 U.S.C. § 5104C recites, in relevant part:
(a) Within one year of decision.
(1) Subject to paragraph (2), in any case in which
the Secretary renders a decision on a claim, the
claimant may take any of the following actions on
or before the date that is one year after the date on
which the [AOJ] issues a decision with respect to
that claim:
(A) File a request for higher-level review
under section 5104B of this title.
(B) File a supplemental claim under section
5108 of this title.
(C) File a [NOD] under section 7105 of this
title.
(2)
(A) Once a claimant takes an action set
forth in paragraph (1), the claimant may
not take another action set forth in that
paragraph with respect to the same claim
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Within one year of an AOJ decision, a claimant may
generally pursue “any” one of three lanes of administrative
review by filing: a request for higher-level review, a supplemental
claim, or a NOD for Board review. See
§ 5104C(a)(1). This general rule, however, is not without
limits, as a claimant cannot simultaneously pursue two or
more administrative review options for the same claim or
issue. See § 5104C(a)(2)(A). But nothing can prohibit that
claimant from pursuing each administrative review option
in succession. See § 5104C(a)(2)(B).
or same issue contained within the claim
until—
(i) the higher-level review, supplemental
claim, or [NOD] is adjudicated;
or
(ii) the request for higher-level review,
supplemental claim, or
[NOD] is withdrawn.
(B) Nothing in this subsection shall prohibit
a claimant from taking any of the actions
set forth in paragraph (1) in
succession with respect to a claim or an issue
contained within the claim.
. . .
(b) More than one year after decision. In any case
in which the Secretary renders a decision on a
claim and more than one year has passed since the
date on which the [AOJ] issues a decision with respect
to that claim, the claimant may file a supplemental
claim under section 5108 of this title.
§ 5104C (emphases added).
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By contrast, after more than one year has passed since
the AOJ’s decision, a claimant is left with only one option
for administrative review—filing a supplemental claim.
See § 5104C(b). Collectively, then, § 5104C establishes two
types of supplemental claims based on when the claim is
filed: § 5104C(a) supplemental claims filed within a year
of an AOJ decision, and § 5104C(b) supplemental claims
filed more than a year after an AOJ decision.
Aside from the timing of when they are filed,
§ 5104C(a) and § 5104C(b) supplemental claims also differ
in two additional ways: their effective dates and the VA’s
duty to notify. Section 5110(a)(2) governs the effective date
of awards and explains that supplemental claims “continuously
pursued”—i.e., filed within one year of a prior decision
from the AOJ, Board, or Veterans Court—are entitled
to an effective date reaching back to “the date of filing of
the initial application for a benefit” (i.e., the initial claim’s
filing date). But “supplemental claims received more than
one year” after an AOJ or Board decision have an effective
date “[no] earlier than the date of receipt of the supplemental
claim.” See § 5110(a)(3). Thus, § 5104C(a) supplemental
claims filed in continuous pursuit may reach back
to the initial claim’s effective date, whereas § 5104C(b) supplemental
claims not filed within continuous pursuit are
accorded an effective date as of their date of receipt by the
VA. See § 5110(a)(3). The VA, moreover, has a duty to notify
claimants of any information or evidence necessary to
substantiate their claims—including § 5104C(b) supplemental
claims, see § 5103(a)(1)—but § 5104C(a) supplemental
claims filed within one year after an AOJ or Board
decision are expressly excluded from this duty, see
§ 5103(a)(3).
The final statutory provision at issue in this appeal is
§ 5904(c)(1), which, unlike the other provisions discussed,
does not explicitly reference supplemental claims. This
provision generally applies to all VA proceedings and appeals
and governs when an attorney or agent may begin to
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charge fees for services rendered in connection with a veteran’s
claim for benefits:
(c)(1) Except as provided in paragraph (4), in connection
with a proceeding before the Department
with respect to benefits under laws administered
by the Secretary, a fee may not be charged, allowed,
or paid for services of agents and attorneys with respect
to services provided before the date on which
a claimant is provided notice of the [AOJ’s] initial
decision under section 5104 of this title with respect
to the case. The limitation in the preceding sentence
does not apply to fees charged, allowed, or
paid for services provided with respect to proceedings
before a court.
§ 5904(c)(1) (emphases added). Under this provision, the
triggering event for when an attorney may begin to charge
fees is when the claimant receives notice of the AOJ’s “initial
decision . . . with respect to the case.” Id.
Below, we address each of Petitioners’ three challenges
in turn.
C. 38 C.F.R. § 14.636(c)(1)(i): Attorneys’ Fees
MVA first challenges the VA’s regulation governing attorneys’
fees and asserts that this regulation is invalid for
treating § 5104C(a) and § 5104C(b) supplemental claims
differently, contrary to the clear meaning of § 5904(c)(1).
1
To begin, we find it worthwhile to review the statutory
history of restrictions on attorneys’ fees for VA benefits
claims. Congress has thrice changed the triggering event
for when attorneys’ fees may be charged, each time shifting
the entry point for such fees—and thus a claimant’s ability
to retain paid representation—earlier in the administrative
appeals process.
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Previously, attorneys’ fees had been strictly limited to
$10 since 1864 due to the “relatively uncomplicated procedure”
of “applying for VA benefits” in “the initial claim
stages,” see S. Rep. No. 100–418, at 63 (1988), which were
“informal and non-adversarial,” see H.R. Rep. No. 100–963
(1988), at 15. This limitation was left unchanged until
1988, when Congress enacted the Veterans’ Judicial Review
Act (VJRA), Pub. L. No. 100–687, 102 Stat. 4105
(1988) (codified at scattered sections of 38 U.S.C.), to allow,
for the first time, judicial review of VA decisions. H.R. Rep.
No. 100–963, at 16. At the same time, Congress also enacted
§ 5904(c)(1) (formerly 38 U.S.C. § 3404(c)(1)) to relax
the existing limitations on attorneys’ fees, recognizing the
importance of retaining legal counsel in both judicial proceedings
and administrative appeals. See S. Rep. No. 100–
418, at 63–64; H.R. Rep. No. 100–963, at 28.
When first enacted, § 5904(c)(1)’s predecessor permitted
attorneys’ fees to be charged only after “the [Board]
first makes a final decision in the case.” See § 3404(c)(1)
(1988). This was intended to “preserve the non-adversarial
initial benefits process, while providing the veteran with
the assistance of an attorney when that process has failed
and the veteran is faced with the complexities of appealing,
reopening, and/or correcting prior adverse decisions.” See
Carpenter v. Nicholson, 452 F.3d 1379, 1383 (2006); see also
Stanley v. Principi, 283 F.3d 1350, 1356 (2002) (“[S]ection
5904(c) was designed to allow veterans to retain paid counsel
in connection with VA proceedings to reopen final Board
decisions, but to bar the retention of paid counsel in connection
with the original VA proceedings, which were
viewed as presenting less complex issues.”). The Senate
Report distinguished reopening and reconsideration proceedings
from the initial proceedings, explaining that “once
the [Board] renders a decision adverse to the claimant on
the merits, the need for the assistance of an attorney is
then markedly greater with respect to such issues as seeking
a reopening and reconsideration and deciding whether
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to proceed to court.” See S. Rep. No. 100–418, at 63–64
(emphasis added).
Subsequently, in 2006, Congress amended § 5904(c)(1)
to shift the triggering event for allowing paid representation
from a final Board decision to when “a [NOD] is filed
with respect to the case.” See § 5904(c)(1) (2006). The accompanying
legislative remarks explained that the amendment
would permit claimants to obtain paid representation
“before [the] VA,” and not just after a final Board decision.
152 Cong. Rec. S11854, at S11855 (2006) (Sen. Akaka); see
also 152 Cong. Rec. H8995-02, at H9018 (2006) (Rep. Miller)
(“Current law prohibits an attorney from receiving a
fee for representing a claimant until the [Board] renders
its first decision on the claim. Unfortunately, the claims
process has become very complex and can be very overwhelming
to some claimants. This provision would give
veterans the option of hiring an attorney earlier in the process
if the veterans believe they need assistance with their
claim.”). Because fees could be charged “only after a [NOD]
has been filed in a case,” the amended statute continued to
bar attorneys’ fees for the initial application of benefits
while, at the same time, expanding a claimant’s ability to
retain counsel to seek review of an unsatisfactory initial
decision by the AOJ. See 152 Cong. Rec. S11854, at
S11855.
Now, under the AMA, the triggering event for attorneys’
fees has once again shifted earlier to permit paid representation
after a claimant receives notice of the AOJ’s
“initial decision . . . with respect to the case.” See
§ 5904(c)(1) (2019); see also H.R. Rep. No. 115–135, at 3 (explaining
this amendment permits “veterans to retain the
services of attorneys and accredited agents who charge a
fee when the [AOJ] provides notice of the original decision”
(emphasis added)). As the VA acknowledged in its Final
Rule, this amendment was necessary “to allow paid representation
with respect to the claimant’s expanded options
for seeking review of an initial decision on a claim.” Final
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Rule, 84 Fed. Reg. at 150 (emphasis added). In other
words, because claimants are no longer limited to filing a
NOD to seek review of an unsatisfactory initial AOJ decision
(and can instead file a supplemental claim or request
for higher-level review), “Congress necessarily had to shift
the entry point for paid representation to the AOJ decision
itself” in order “to permit paid representation regardless of
the form of review.” Id. (emphasis added). This shift was
part of a continuing congressional effort to enlarge the
scope of activities for which attorneys can receive compensation
for assisting veterans.
2
Section 14.636(c)(1)(i),11 titled “[c]ircumstances under
which fees may be charged,” permits attorneys to charge
11 38 C.F.R. § 14.636(c)(1)(i) states:
(c) Circumstances under which fees may be
charged. Except as noted in paragraph (d) of this
section, agents and attorneys may only charge fees
as follows:
(1)(i) Agents and attorneys may charge claimants
or appellants for representation provided after an
[AOJ] has issued notice of an initial decision on the
claim or claims. . . . For purposes of this paragraph
(c)(1)(i), an initial decision on a claim would include
an initial decision on an initial claim for an
increase in rate of benefit, an initial decision on a
request to revise a prior decision based on [CUE]
(unless fees are permitted at an earlier point pursuant
to paragraph (c)(1)(ii) or paragraph (c)(2)(ii)
of this section), and an initial decision on a supplemental
claim that was presented after the final adjudication
of an earlier claim. However, a
supplemental claim will be considered part of the
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fees for work performed after an AOJ has issued “an initial
decision on the claim.” See § 14.636(c)(1)(i). The regulation,
however, treats § 5104C(b) supplemental claims differently
from all other forms of administrative review,
including § 5104C(a) supplemental claims. See Final Rule,
84 Fed. Reg. at 150 (explaining that the regulation “treats
supplemental claims differently based on whether they
were filed within one year of a prior decision”). Specifically,
§ 5104C(a) supplemental claims, which are “continuously
pursued” within one year of a prior decision, “will be considered
part of the earlier [initial] claim,” such that attorneys
may charge fees for any work performed on the
supplemental claim. Id. But for § 5104C(b) supplemental
claims, which involve claim issues that are no different in
substance from § 5104C(a) supplemental claims, fees may
only be charged for work performed after “an initial decision
on [the] supplemental claim” itself. Id. This regulation
thus permits claimants to receive paid representation
for all work on a § 5104C(a) supplemental claim—including
the preparation and filing of such a claim—but requires
earlier claim if the claimant has continuously pursued
the earlier claim by filing any of the following,
either alone or in succession: A request for higherlevel
review, on or before one year after the date on
which the [AOJ] issued a decision; a supplemental
claim, on or before one year after the date on which
the [AOJ] issued a decision; a [NOD], on or before
one year after the date on which the [AOJ] issued a
decision; a supplemental claim, on or before one
year after the date on which the Board of Veterans’
Appeals issued a decision; or a supplemental claim,
on or before one year after the date on which the
Court of Appeals for Veterans Claims issued a decision.
§ 14.636(c)(1)(i) (emphases added).
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a § 5104C(b) supplemental claim to be first denied before
paid representation is available.
MVA urges us to invalidate § 14.636(c)(1)(i) for contravening
the clear statutory basis for this regulation as
set forth in § 5904(c)(1). Specifically, MVA argues that the
regulation’s unequal treatment of § 5104C(a) and
§ 5104C(b) supplemental claims violates the AMA’s “unambiguous[]
require[ment] that all work on supplemental
claims be capable of compensation.” Pet’r Br. (No. 19-1600)
at 49. MVA contends that nothing in the statute limits fees
for § 5104C(b) claims or otherwise distinguishes fees for
different types of supplemental claims. Instead,
§ 5904(c)(1) restricts only fees charged before an AOJ’s “initial
decision . . . with respect to the case,” and a supplemental
claim is part of the same “case” as the initial claim,
whether continuously pursued within a year of a prior decision
or not.
The government does not attempt to argue that
§ 5904(c)(1)’s text directly supports differential treatment
of § 5104C(a) and § 5104C(b) supplemental claims as to
paid representation. Instead, it argues that the VA’s regulation
deserves deference because the VA has an established
practice of treating motions to reopen “finallydecided
claims based on new evidence” as a “separate
case[]” for the purposes of attorneys’ fees, which it purports
are analogous to § 5104C(b) supplemental claims under the
AMA, and nothing in the AMA or its statutory history indicates
that Congress intended for the VA to deviate from
this practice. Resp’t Br. (No. 19-1600) at 41. The government
also contends that the regulation is consistent with
congressional intent because the AMA itself treats
§ 5104C(a) and § 5104C(b) supplemental claims differently
by assigning different effective dates and imposing different
notification duties on the VA. We disagree and conclude
that § 14.636(c)(1)(i) contradicts the unambiguous
meaning of § 5904(c)(1), which permits paid representation
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for all forms of administrative review under the AMA, including
§ 5104C(b) supplemental claims.
Starting with the words of the statutory provision itself,
§ 5904(c)(1) states that attorneys’ fees may not be
charged for services provided before the date a claimant receives
notice of the AOJ’s “initial decision . . . with respect
to the case.” On its face, the provision recites no other restriction
on attorneys’ fees. Nor does the provision distinguish
between work performed on different types of
administrative review under the AMA. Because all such
review work necessarily occurs after the AOJ issues an “initial
decision . . . with respect to the case,” a straightforward
reading of § 5904(c)(1) indicates that work on all
forms of review under the AMA—including § 5104C(b) supplemental
claims—should be compensable.
Our reading of the statutory provision also comports
with legislative intent, as supported by the statutory history.
As the VA acknowledges, Congress shifted
§ 5904(c)(1)’s entry point for paid representation from the
filing of a NOD to receiving notice of the AOJ’s initial decision
“to permit paid representation regardless of the form
of review” a claimant chooses. See Final Rule, 84 Fed. Reg.
at 150 (emphasis added). After receiving the AOJ’s initial
decision, a claimant may initiate review of that decision by
either filing a NOD, requesting higher-level review, or filing
a supplemental claim—even if that supplemental claim
is filed “more than one year [after] the date on which the
[AOJ] issues a decision with respect to [the initial] claim.”
See § 5104C(b); see generally § 5104C (titled “[o]ptions following
decision by [AOJ]” and including both § 5104C(a)
and § 5104C(b) supplemental claims among such options).
All are “form[s] of review” under the AMA. Section
5904(c)(1), moreover, is devoid of any indication that
§ 5104C(b) supplemental claims should be treated differently
from other types of administrative review for purposes
of attorneys’ fees. Yet, no other form of review is
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subject to the same restrictions on attorneys’ fees under the
VA’s regulation.
We also reject the government’s argument that a
§ 5104C(b) supplemental claim filed more than a year after
a prior decision is not part of the same “case” as that earlier
decision, thereby barring attorneys from charging fees for
any work on such claims until the supplemental claim itself
is rejected. Logic dictates that § 5104C(b) supplemental
claims, like any other form of administrative review under
the AMA, should be construed as part of the same “case” as
the initial AOJ decision being reviewed, just as an appeal
or motion for reconsideration in litigation is considered
part of the same “case” as the underlying decision. See 38
U.S.C. § 101(36) (defining “supplemental claim” as “a claim
for benefits . . . filed by a claimant who had previously filed
a claim for the same or similar benefits on the same or similar
basis” (emphases added)). While neither § 5904(c)(1)
nor any other provision of the AMA defines the term “case,”
the parallel language in § 5104C(a) and § 5104C(b) suggests
that supplemental claims belong to the same “case”
as the initial decision being reviewed, regardless of when
they are filed. Compare § 5104C(a) (“in any case in which
the Secretary renders a decision on a claim, the claimant
may” file a supplemental claim within one year of when the
AOJ issues a decision with respect to that claim (emphasis
added)), with § 5104C(b) (“[i]n any case in which the Secretary
renders a decision on a claim and more than one year
has passed since the date [the AOJ] issues a decision with
respect to that claim, a claimant may file a supplemental
claim” (emphasis added)).
Although the government correctly notes that
§ 5104C(b) supplemental claims may have a different effective
date and duty to notify than § 5104C(a) supplemental
claims, see §§ 5110(a)(3), 5103(a)(3), we see no reason why
these distinctions should matter in the context of charging
attorneys’ fees. That § 5104C(b) supplemental claims are
not entitled to an effective date reaching back to the initial
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claim merely reflects Congress’s efforts to “streamline” the
“broken” legacy appeals process that allowed for “repeated
revisions and resubmissions of claims while maintaining
an effective date for benefits based upon the original filing
date of the claim.” See H.R. Rep. 115–135, at 8. Restricting
the effective date of § 5104C(b) supplemental claims simply
reflects a legislative choice to award claimants who delayed
seeking review of their claims for over a year fewer benefits
than those who “continuously pursued” administrative review.
It says nothing of Congress’s intent to restrict attorneys’
fees or limit a claimant’s ability to retain paid
representation for § 5104C(b) supplemental claims. The
government, moreover, has not identified any differences
in the work that an attorney would perform on a § 5104C(a)
claim as opposed to a § 5104C(b) claim that would justify
compensating the former but not the latter.
As for the VA’s “longstanding interpretation” of legacy
reopening claims as belonging to a “case” separate from
that of the original claim for benefits, the government argues
that “Congress has now amended section 5904(c)
twice and has not overruled [the] VA’s statutory interpretation.”
Resp’t Br. (No. 19-1600) at 46. From this purported
inaction, the government presumes that Congress
has implicitly ratified the VA’s practice of restricting paid
representation for legacy reopening claims and, by extension,
for any “post-final decision claims based on new evidence.”
Id. at 47. This argument suffers from several
flaws. Included among them is our express rejection of the
VA’s interpretation in both Stanley and Carpenter, discussed
infra.
To begin with, an implicit ratification theory holds no
water where, as here, the regulation at issue clearly contradicts
the requirements of the statutory provision. See
Brown v. Gardner, 513 U.S. 115, 121 (1994) (“There is an
obvious trump to the reenactment argument . . . in the rule
that where the law is plain, subsequent reenactment does
not constitute an adoption of a previous administrative
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construction.”); id. at 122 (“A regulation’s age is no antidote
to clear inconsistency with a statute, and the fact [that the
regulation] flies against the plain language of the statutory
text exempts courts from any obligation to defer to it.”).
Reenactment, moreover, “[cannot] carry the day” where
“there is no . . . evidence to suggest Congress was even
aware of the VA’s interpretative position.” Id. Here, as we
have concluded, § 14.636(c)(1)(i)’s differential treatment of
§ 5104C(b) supplemental claims clearly contravenes
§ 5904(c)(1)’s requirement that paid representation be
available for all forms of administrative review under the
AMA. We also see no indication that Congress was aware
of the VA’s regulations restricting paid representation for
reopening claims or distinguishing such claims as separate
from “the case” of the initial claim. Under such circumstances,
we reject the government’s implicit ratification argument.
Far from “inaction” that would suggest implicit ratification
of preexisting practices, the AMA dramatically overhauled
the VA appeals process by replacing the “broken,”
one-size-fits-all legacy system with a new three-lane system.
Given the extent and nature of the AMA’s reforms,
we think it unlikely that Congress intended to preserve the
VA’s “longstanding interpretation” of the fee statutory provision
from the superseded legacy system, especially where
the regulation at issue contradicts both the plain and ordinary
meaning of the statutory provision and the statutory
history. The AMA’s three-lane system was intended to alleviate
the legacy system’s growing appeals backlog by allowing
claimants to choose from new and more efficient
administrative review pathways specifically tailored for
their needs. But the AMA’s reforms can only succeed if
claimants are able to avail themselves of these additional
pathways, and Congress, in turn, amended the fee provision
to provide claimants with paid representation regardless
of the form of administrative review sought. We would
do little justice to Congress’s amendments by clinging to a
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legacy administrative practice that markedly restricts paid
representation for one lane of review. Cf. Stanley, 283 F.3d
at 1356 (explaining that Congress amended the fee provision
in 1988 because the “new right to judicial review” under
the VJRA “would be a hollow right indeed without some
easing of the limitation on attorneys’ fees” (quoting S. Rep.
No. 100–418, at 63)).
Lastly, we reject the government’s proposition that this
court has previously endorsed the VA’s longstanding interpretation
of the fee provision—that is, “the basic principle
that a reopening proceeding is separate from the original
case” and thus foreclosed from paid representation until
the VA issues a decision on the reopening claim itself.
Resp’t Br. (No. 19-1600) at 39 (citing Stanley, 283 F.3d at
1358). Even assuming, as the government contends, that
§ 5104C(b) supplemental claims under the AMA are analogous
to legacy reopening claims, we have never denied attorneys’
fees for work performed on reopening proceedings
based on the VA’s understanding of “case.” To the contrary,
our decisions in Stanley and Carpenter reinforce our textual
analysis that § 5904(c)(1) plainly permits paid representation
for all forms of administrative review after the
AOJ’s initial decision on the original claim for benefits.
In Stanley, we considered an earlier (and more restrictive)
version of the fee provision prohibiting attorneys from
collecting fees until “the [Board] first makes a final decision
in the case.” See § 5904(c) (2000). The issue before us was
whether an attorney could collect fees for work performed
on a legacy reopening claim filed more than a year after an
AOJ’s initial decision, which thus became final. We held
that such fees were permissible because § 5904(c) “was designed
to allow attorneys’ fees after the initial claims proceeding,
in connection with proceedings to reopen a claim
on the ground of new and material evidence or [CUE],” 283
F.3d at 1352 (emphasis added), and “[t]he retention of paid
counsel would have been permissible at the point when the
[AOJ’s initial] decision became ‘final,’” id. at 1357. In other
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words, even under a more limited version of the fee provision,
we permitted paid representation for administrative
review proceedings filed more than a year after the AOJ’s
initial decision and based on new and material evidence.
While Stanley described the “reopening proceeding . . . [as]
a separate ‘case’” having a “final decision,” that statement
was made to allow, rather than deny, paid representation
for reopening work under the then-existing fee provision,
which required a “final decision” for attorneys’ fees to be
charged. See id. at 1358.
We later clarified Stanley’s reasoning in Carpenter, explaining
that “a veteran’s claim based on the specified disability
does not become a different ‘case’ at each stage of
the often lengthy and complex proceedings, including remands
as well as reopenings as in Stanley.” 452 F.3d at
1384 (emphasis added). Specifically, in Carpenter, we concluded
that a later CUE challenge (which is necessarily
filed after a decision on the original claim has become final
and cut off from direct review) is part of the same “case” as
other challenges to the initial decision. See id. at 1384. Attorneys
may charge fees for work on CUE claims, we explained,
because the fee provision “was designed to
authorize compensation for attorney services rendered after
the initial proceedings, undertaken by the veteran,
have failed.” Id. A “case” therefore “encompasses all potential
claims raised by the evidence, applying all relevant
laws and regulations, regardless of whether the claim is
specifically labeled.” Id. Just as a CUE claim belongs to
the same “case” as a veteran’s original claim for benefits,
thereby permitting paid representation for work performed
after an AOJ’s initial decision, so too does a § 5104C(b) supplemental
claim seeking the “same or similar benefits on
the same or similar basis” as the original claim. See
§ 101(38).
For these reasons, we hold that § 14.636(c)(1)(i) is contrary
with the plain and ordinary meaning of § 5904(c)(1),
and we thus invalidate that regulatory provision.
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D. 38 C.F.R. § 3.2500(b): Prohibition on Concurrent Supplemental
Claim and Federal Court Appeal
Section 3.2500(b) places two restrictions on the use of
administrative review:
(b) Concurrent election prohibited. With regard to
the adjudication of a claim or an issue as defined in
§ 3.151(c), a claimant who has filed for review under
one of the options available under paragraph
(a) of this section12 may not, while that review is
pending final adjudication, file for review under a
different available option. While the adjudication
of a specific benefit is pending on appeal before a
federal court, a claimant may not file for
12 38 C.F.R. § 3.2500(a), titled “[r]eviews available,”
summarizes a claimant’s three “administrative review options”
under the AMA:
(1) Within one year from the date on which the
[AOJ] issues a notice of a decision on a claim or issue
as defined in § 3.151(c), except as otherwise
provided in paragraphs (c), (e), and (f) of this section,
a claimant may elect one of the following administrative
review options by timely filing the
appropriate form prescribed by the Secretary:
(i) A request for higher-level review under
§ 3.2601 or
(ii) An appeal to the Board under § 20.202
of this chapter.
(2) At any time after VA issues notice of a decision
on an issue within a claim, a claimant may file a
supplemental claim under § 3.2501.
§ 3.2500(a) (emphases added).
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administrative review of the claim under any of
[the] options listed in paragraph (a) of this section.
§ 3.2500(b) (emphases added). First, this regulation prohibits
claimants from pursuing two concurrent lanes of administrative
review for the same “claim or [] issue.”
Separately, § 3.2500(b) also prohibits claimants from filing
for administrative review of a claim “[w]hile adjudication
of a specific benefit is pending on appeal before a federal
court.”
PVA challenges only the validity of § 3.2500(b)’s second
prohibition on concurrent administrative and judicial review.
We note, as an initial matter, that the only form of
administrative review that is potentially available for a
claim already pending on appeal before a federal court is a
supplemental claim.13 Thus, this prohibition primarily affects
claimants who have already appealed their claim to a
federal court (from an adverse Board decision) but believe
they have “new and relevant evidence” for that same claim
that could entitle them to benefits.14 This regulation bars
such claimants from filing a supplemental claim with the
VA based on that “new and relevant evidence” while judicial
appeal of their initial claim remains pending before
this court or the Supreme Court. They must instead wait
13 This follows because only a final Board decision (initiated
by filing a NOD) may be appealed to a federal court,
and there can be no higher-level review by the AOJ of a
final Board decision.
14 We assume that the VA meant “federal court” in
§ 3.2500(b) to include the Veterans Court, even though the
Veterans Court is “an Executive Branch entity,” United
States v. Arthrex, Inc., 141 S. Ct. 1970, 1984 (2021). Regardless,
we hold that § 5104C, our statutory basis for invalidating
§ 3.2500(b), permits a veteran to file a
supplemental claim at any time after receiving an adverse
Board decision.
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until the judicial appeal concludes to file any such supplemental
claims.
This prohibition, PVA argues, is invalid because it “imposes
new restrictions that are not contemplated in the
statute.” Pet’rs Br. (No. 19-1680) at 24. While
§ 5104C(a)(2)(A)15 appears to provide a statutory basis for
§ 3.2500(b)’s first prohibition against concurrent lanes of
administrative review, no statutory provision directly supports
§ 3.2500(b)’s second prohibition against concurrent
administrative and judicial review. Id. PVA further contends
that this prohibition harms claimants in two ways.
First, § 3.2500(b) can delay a claimant’s receipt of benefits.
A claimant possessing “new and relevant evidence” that
would entitle the claimant to benefits must wait until an
ongoing judicial appeal concludes before a supplemental
claim requesting readjudication based on that new evidence
can be filed.
But more importantly, PVA contends, claimants seeking
to appeal an adverse Veterans Court decision are forced
to make a “hard choice” between pursuing appellate review
beyond the Veterans Court and filing a supplemental claim
within continuous pursuit. Pet’rs Br. (No. 19-1680) at 24– - This follows because § 5110(a)(2)—the statutory provision
governing effective dates of “continuously pursued”
claims—does not, on its face, recite that supplemental
claims filed within one year of a Federal Circuit or Supreme
Court decision are entitled to their original effective
date. Such effective date protections are instead only expressly
recited for supplemental claims filed within one
year of a Veterans Court decision, a Board decision, or an
15 Section 5104C(a)(2)(A) explains that once a claimant
pursues one lane of administrative review, the claimant
cannot pursue another lane of administrative review
“with respect to the same claim or issue until” that first
review is “adjudicated” or “withdrawn.”
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AOJ decision. See § 5110(a)(2)(B), (D)–(E);16 see also
§ 3.2500(c), (h)(1) (implementing regulations reflecting
same). Accordingly, while a claimant may still file a supplemental
claim after unsuccessfully appealing an adverse
Veterans Court decision to this court or the Supreme
16 38 U.S.C. § 5110(a)(2) recites:
(2) For purposes of determining the effective date
of an award under this section, the date of application
shall be considered the date of the filing of the
initial application for a benefit if the claim is continuously
pursued by filing any of the following, either
alone or in succession:
(A) A request for higher-level review under
section 5104B of this title on or before the
date that is one year after the date on
which the [AOJ] issues a decision.
(B) A supplemental claim under section
5108 of this title on or before the date that
is one year after the date on which the
[AOJ] issues a decision.
(C) A [NOD] on or before the date that is
one year after the date on which the [AOJ]
issues a decision.
(D) A supplemental claim under section
5108 of this title on or before the date that
is one year after the date on which the
[Board] issues a decision.
(E) A supplemental claim under section
5108 of this title on or before the date that
is one year after the date on which the [Veterans
Court] issues a decision.
§ 5110(a)(2) (emphases added).
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Court, the claimant risks losing entitlement to the original
effective date for any benefits awarded on that supplemental
claim. On the other hand, a claimant who chooses
not to appeal an adverse Veterans Court decision and instead
files a supplemental claim within continuous pursuit
will retain the initial claim’s original effective date for any
benefits awarded. § 5110(a)(2)(E). But in doing so, that
claimant gives up the opportunity to have this court review
the Veterans Court’s legal rulings under 38 U.S.C. § 7292.
Consequently, PVA argues, § 3.2500(b) improperly forces
claimants “to choose between pursuing the appeal rights
granted to them by statute . . . and protecting their effective
date of benefits.” Pet’rs Br. (No. 19-1680) at 23.
The government responds that, as a threshold matter,
the primary harm PVA complains of—loss of effective
date—will soon be irrelevant because the “VA plans to propose
a regulatory change [to § 3.2500(c), (g)] to protect the
effective dates of supplemental claims” filed within one
year of a decision by this court or the Supreme Court.
Resp’t Br. (No. 19-1680) at 17. But more to the point, the
government argues, § 3.2500(b)’s requirement that claimants
pursue administrative review sequentially (rather
than concurrently) with judicial review in the federal
courts is consistent with the AMA and should be sustained
because it “reasonably promotes systemic efficiency without
prejudicing claimants.” Id. at 10.
We note that it has been over a year since the government
filed its brief, and we have yet to see a notice of proposed
rulemaking for the regulatory changes mentioned.
Instead, on March 19, 2020, the VA issued a policy letter
stating that “[e]ffective immediately, claims adjudicators
must consider supplemental claims . . . filed within one
year of a Federal Circuit or Supreme Court decision as continuously
pursued and apply the provisions of 38 C.F.R.
§ 3.2500(h)(1) when adjudicating the claim.” See VA Policy
Letter 20–01 (Mar. 19, 2020).
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It is unclear what effect, if any, the VA’s unfulfilled
promise of forthcoming regulatory amendments and subsequent
policy letter has on our analysis of § 3.2500(b)’s validity.
But we ultimately need not resolve that question
here. For even if the VA had amended its regulations
through notice-and-comment rulemaking to extend effective
date protections for supplemental claims filed within a
year of a Federal Circuit or Supreme Court decision,17 we
would nonetheless conclude that § 3.2500(b)’s bar on filing
a supplemental claim during the pendency of a federal
court appeal is invalid for contradicting the plain and ordinary
meaning of § 5104C.
Both parties agree that while § 5104C expressly bars
concurrent lanes of administrative review, see
§ 5104C(a)(2)(A), it does not expressly prohibit concurrent
administrative and judicial review. Thus, nothing in this
statutory provision nor any other provision of the AMA expressly
prohibits filing a supplemental claim during a
pending appeal in federal court. The government interprets
the absence of such a provision as a statutory gap for
the VA to fill. See Resp’t Br. (No. 19-1680) at 15–16. It
contends that § 3.2500(b) is a reasonable construction of
§ 5104C(a)(2)(A) warranting deference because the additional
prohibition against concurrent administrative and
judicial review is consistent with the AMA’s efficiency
goals. We disagree and conclude that § 5104C leaves no
gap to be filled because it unambiguously permits claimants
to file supplemental claims while judicial review of the
same underlying claim or issue is pending in federal court.
Section 5104C broadly authorizes a claimant to file a
supplemental claim “[i]n any case in which the Secretary
renders a decision on a claim,” whether filed within one
year of an AOJ decision or not. See § 5104C(a)(1)(B), (b)
17 We make no conclusions as to whether such an
amended regulation, if promulgated, would be valid.
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(emphasis added); see also H.R. Rep. No. 115–135, at 10
(explaining that § 5104C(b) would “[c]larify that in any
case in which more than one year has passed in which the
AOJ has issued a decision denying a claim, the claimant
may file a supplemental claim”). Yet this broad authorization,
as we have noted, is not without limits. Once a claimant
has initiated one lane of administrative review, that
claimant “may not” pursue another lane, such as filing a
supplemental claim, “until the higher-level review, supplemental
claim, or [NOD] is adjudicated[] or . . . withdrawn.”
§ 5104C(a)(2)(A) (emphasis added). But while the adjudication
or withdrawal of any prior administrative review is
a prerequisite to filing a subsequent supplemental claim,
no provision of the AMA requires completion of an ongoing
judicial review as yet another hurdle to filing a supplemental
claim.
To the contrary, § 5104C(a)(2)(A) demonstrates that
Congress knew how to bar two simultaneous forms of review
but chose to only bar concurrent lanes of administrative
review. That Congress did not include an analogous
provision also barring concurrent administrative and judicial
review suggests that it simply did not intend to do so.
Cf. Hamdan v. Rumsfeld, 548 U.S. 557, 578 (2006) (“A familiar
principle of statutory construction . . . is that a negative
inference may be drawn from the exclusion of
language from one statutory provision that is included in
other provisions of the same statute.”); Jama v. Immigr. &
Customs Enf’t, 543 U.S. 335, 341 (2005) (“We do not lightly
assume that Congress has omitted from its adopted text
requirements that it nonetheless intends to apply, and our
reluctance is even greater when Congress has shown elsewhere
in the same statute that it knows how to make such
a requirement manifest.”). At the same time,
§ 5104C(a)(2)(B) makes clear that “[n]othing in this subsection
shall prohibit a claimant from taking [administrative
review actions] in succession.” See § 5104C(a)(2)(B) (emphases
added). Section 5104C(a)(2)(B), then, protects a
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claimant’s ability to file a supplemental claim following an
unsatisfactory Board decision, and we see nothing in the
AMA that would change this outcome once that Board decision
is appealed to the Veterans Court. Accordingly,
§ 5104C, read in its entirety, makes clear that a claimant
whose initial claim is on appeal before a federal court does
not have to wait until the completion of that appeal to file
a supplemental claim.
The government responds that our reading of § 5104C
undermines Congress’s broad intent to improve the timely
administration of the VA benefits program and reintroduces
some of the inefficiencies the AMA sought to eliminate.
Resp’t Br. (No. 19-1680) at 19–20. But nothing in the
AMA’s text or statutory history suggests that the concerns
driving Congress’s reforms to the VA’s legacy administrative
review process are also implicated by concurrent judicial
and supplemental claim review. Instead, permitting a
claimant to file a supplemental claim during the long pendency
of a judicial appeal could result in an earlier award
of benefits, which is consistent with, and not contrary to,
the AMA’s goal of reducing protracted wait times for receiving
a final decision on benefits. The statutory text and statutory
history, moreover, indicate that Congress intended to
allow supplemental claims to be filed “in any case in which
more than one year has passed in which the AOJ has issued
a decision denying a claim.” H.R. Rep. No. 115–135, at 10;
see also § 5104C(b). To the extent that the broad availability
of supplemental claims undermines the AMA’s efficiency
goals, Congress already addressed that concern
through § 5104C(a)(2)(A)’s express prohibition on simultaneously
pursuing two different lanes of administrative review,
and nothing indicates that Congress had similar
concerns about concurrent judicial and supplemental claim
review. For these reasons, we conclude that our reading of
§ 5104C is consistent with, and not contrary to, congressional
intent under the AMA.
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Because we conclude that § 5104C’s statutory text unambiguously
permits filing a supplemental claim during
the pendency of an appeal before a federal court, we need
not proceed to Chevron’s second step to consider the VA’s
policy justifications for the regulation. We therefore hold
that § 3.2500(b) is invalid for contravening § 5104C’s clear
statutory text.
E. 38 C.F.R. § 3.155: Intent-to-File Framework
For claimants to receive VA benefits, “[a] specific claim
in the form prescribed by the Secretary . . . must be filed.”
See § 5101(a)(1). The VA, however, has long permitted
claimants to establish a claim’s effective date through a
preliminary submission indicating an intent to apply for
benefits, which serves as a placeholder until the claimant
files a formal application for benefits within a specified period.
See VJG, 818 F.3d at 1341. Under the current “intent-
to-file” framework,18 a claimant who signals an
intention to apply for benefits through a format specified
by regulation, and later completes a formal application for
benefits within one year, will be afforded an effective date
as of the day the intent-to-file was signaled. See id. at
1342.
18 The “intent-to-file” framework was implemented in
September 2014 to replace the previous “informal claims”
framework. See Standard Claims and Appeals Forms, 79
Fed. Reg. 57,660 (Sept. 25, 2014); see also § 3.155(a) (2014).
Under the “intent-to-file” framework, a claimant may signal
a preliminary intent to apply for benefits by (1) saving
an electronic application within a VA web-based claims application
system; (2) submitting a VA standard form in either
paper or electronic form; or (3) oral communication
with designated VA personnel regarding the claimant’s intent
to file a claim. See § 3.155(b)(1)(i)–(iii).
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Section § 3.155 governs the “manner and methods in
which a claim can be initiated and filed,” including the intent-
to-file process set forth in § 3.155(b). The regulation’s
preamble expressly excludes supplemental claims—but not
initial claims—from § 3.155(b)’s intent-to-file framework:
The following paragraphs describe the manner and
methods in which a claim can be initiated and filed.
The provisions of this section are applicable to all
claims governed by part 3, with the exception that
paragraph (b) of this section, regarding intent to file
a claim, does not apply to supplemental claims.
§ 3.155 (emphasis added).
In the Final Rule, the VA explained that the AMA’s
amendments to § 5110 required differential treatment of
initial and supplemental claims. See 84 Fed. Reg. at 142.
Because § 5110 “prescribes a one-year filing period” during
which claimants may pursue supplemental claims while
maintaining the initial claim’s effective date, applying the
intent-to-file framework “would allow for supplemental
claim[s] [submitted] beyond the one-year period” to retain
an earlier effective date, contrary to § 5110(a)(3)’s requirement
that the effective date of such supplemental claims
“shall not be earlier than the date of receipt.” See id.
PVA argues that this regulation is arbitrary and capricious
because the VA interprets “virtually identical” statutory
language in § 5110(a)(1) and § 5110(a)(3)
inconsistently. Section 5110(a)(3) states that the effective
date of § 5104C(b) supplemental claims “shall not be earlier
than the date of receipt of the supplemental claim,” and
§ 5110(a)(1) likewise requires that the effective date of an
initial claim “shall not be earlier than the date of receipt of
application therefor.” It thus makes little sense, PVA contends,
for the VA to interpret this substantially similar language
to forbid an intent-to-file submission in one instance
but not another. PVA also argues that the VA’s explanation
for this rule runs counter to another regulatory
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provision that permits claimants who have filed an incomplete
supplemental claim form to retain that filing date as
their effective date so long as they submit a complete supplemental
claim form within 60 days. See § 3.155(d)(1)(i)
(“Upon receipt of a communication indicating a belief in entitlement
to benefits that is submitted . . . on a supplemental
claim form . . . that is not complete,” the Secretary
“shall notify the claimant . . . of the information necessary
to complete the application form” and “[i]f VA receives a
complete claim within 60 days of notice by VA that an incomplete
claim was filed, it will be considered filed as of the
date of receipt of the incomplete claim.”).
The government, for its part, does not defend the validity
of § 3.155’s preamble. Rather than litigate the regulation
on the merits, the government asks that we dismiss
and remand this challenge back to the agency. Specifically,
“without conceding that [PVA’s] challenge is meritorious,”
it avers that the “VA plans to propose a regulation to
amend [§] 3.155 to apply the intent[-]to[-]file rule to
[§] 5104C(b) supplemental claims” such that “[PVA’s] challenge
will become moot.” Resp’t Br. (No. 19-1680) at 43.
But if the proposed amendments to § 3.155 have not materialized
by the time we render judgment in this matter, the
government requests a voluntary remand for the VA to
complete its rulemaking process. See id. at 43–44.
We decline, as a threshold matter, to grant the government’s
request for voluntary remand. Much as was the
case for the promised regulatory changes to § 3.2500(b), we
have yet to see any indication that the VA will amend
§ 3.155’s preamble to include supplemental claims within
the intent-to-file framework. While courts have discretion
to grant a request for voluntary remand so that the agency
can reconsider its previous position, see SKF USA Inc. v.
United States, 254 F.3d 1022, 1029 (Fed. Cir. 2001), the VA
has already had quite some time to revise a plainly invalid
regulation but failed to do so. Although the VA assured
this court that it would make certain amendments to two
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of its regulations, several months have now passed since
oral argument, and not one of these regulatory amendments
has materialized. Nor has the VA provided any updates
or a timeline for when such changes might occur.
Under these circumstances, we are unpersuaded that a remand
to the VA would be of any benefit, and we see no reason
to avoid resolving the ultimate question of validity.
Turning to the merits, we agree with PVA that
§ 3.155’s exclusion of supplemental claims from the intentto-
file framework is arbitrary and capricious. The VA’s
proffered explanation for this rule squarely contradicts
other provisions of this regulation (i.e., § 3.155(d)(1)(i))
demonstrating that the effective date of a supplemental
claim can, in fact, be earlier than the date that the VA receives
the completed supplemental claim. Much like
§ 3.155(b)’s intent-to-file framework, this provision effectively
permits a preliminary submission “indicating a belief
in entitlement to benefits” to serve as an effective date
placeholder for the later completed supplemental claim.
Moreover, it is a well-established canon of statutory
construction that Congress is presumed to have intended
for “identical words used in different parts of the same
act . . . to have the same meaning.” See Sorenson v. Sec’y
of the Treasury, 475 U.S. 851, 860 (1986) (quoting Helvering
v. Stockholms Enskilda Bank, 293 U.S. 84, 87 (1934)
(in turn quoting Atl. Cleaners & Dyers, Inc. v. United
States, 286 U.S. 427, 433 (1932))). To overcome this presumption,
the VA must demonstrate that it engaged in reasoned
decision-making by providing an “adequate
explanation” for its difference in interpretation of similarly
worded statutory provisions. See Nat’l Org. of Veterans’
Advocs. v. Sec’y of Veterans Affs., 260 F.3d 1365, 1380 (Fed.
Cir. 2001) (setting aside regulation because the VA “purport[
ed] to interpret virtually identical language contained
in related veterans’ benefits statutes to mean different
things, without providing an adequate explanation for the
inconsistency”); see also State Farm, 463 U.S. at 34
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(arbitrary and capricious standard requires that an agency
demonstrate that it engaged in reasoned decision-making
by providing an “adequate basis and explanation” for its
decision). Here, the VA has not offered any explanation for
why it interpreted the substantively identical language in
§ 5110(a)(1) and § 5110(a)(3) inconsistently. If the application
for an initial claim is “deem[ed] . . . to have been received
as of the date of the intent to file a claim,” we see no
reason why that same interpretation may not also apply to
deem a supplemental claim received as of the date of the
intent-to-file submission. For these reasons, we hold that
the VA acted arbitrarily and capriciously in excluding supplemental
claims from the intent-to-file framework. Section
3.155’s preamble, to the extent that it does so, is
invalid.
CONCLUSION
In sum, MVA and PVA collectively have associational
standing to challenge the validity of § 14.636(c)(1)(i),
§ 3.2500(b), and § 3.155, and no Petitioner has demonstrated
standing to challenge the validity of any other regulatory
provisions raised in the petitions. We hold that all
three regulatory provisions that MVA and PVA have standing
to challenge are invalid. Section 14.636(c)(1)(i)’s restriction
on attorneys’ fees for § 5104C(b) supplemental
claims is invalid because it contravenes the plain and ordinary
meaning of § 5904(c)(1), which permits paid representation
once a claimant receives notice of the AOJ’s “initial
decision . . . with respect to the case.” Section 3.2500(b)’s
bar on filing supplemental claims during the pendency of a
judicial appeal is invalid for contravening § 5104C’s clear
authorization for filing supplemental claims “[i]n any case
in which the Secretary renders a decision on a claim.”
Lastly, § 3.155’s preamble excluding only supplemental
claims from the intent-to-file framework is arbitrary and
capricious because the VA failed to adequately explain its
inconsistent treatment of initial and supplemental claims
given the substantially similar statutory language in
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§ 5110(a)(1) and § 5110(a)(3). Accordingly, we grant-inpart
and dismiss-in-part MVA’s and PVA’s petitions in Appeal
Nos. 19-1600 and 19-1680, and we dismiss the remaining
two petitions in Appeal Nos. 19-1685 and 19-1687 in
their entirety.
GRANTED-IN-PART AND DISMISSED-IN-PART
COSTS
No costs.
Case: 19-1600 Document: 67 Page: 63 Filed: 07/30/2021
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