Is the Sky Falling? Will ALJs Become Political Pawns?

By Thomas C. Fitzhugh, III, Schouest, Bamdas, Soshea & BenMaier PLLC, Houston, Texas

Last month Steve Embry reported the developments in the Administrative Law Judge (ALJ) world following the Supreme Court’s opinion in Lucia v. Securities & Exchange Commission, 201 L.Ed 2d 464 (2018), and the President’s Executive Order 13483 moving ALJ’s from selection by competitive examination to executive appointments. The article ended with speculation that partisan appointment and removal of ALJ’s could bring political pressure to bear in disputed cases. While that is a possibility, experience with the Benefits Review Board shows that it is unlikely.

When I finished law school in 1976 the mechanisms created in the 1972 Amendments to the LHWCA were being road-tested. The Benefits Review Board had only three “members,” and the concept was to have one union representative, one industry, and one public member. Ruth Washington was the original chairperson, and Julius Miller, a long-time longshore union official, represented labor, and Ismene Kalaris was the public member. Titles changed from “Member” to “Administrative Appeals Judge,” and this group worked hard to flesh out the meaning of the 1972 Amendments. The first few volumes of the BRBS ran to several hundred pages of Benefit Review Board cases. The Board then traveled far more than today’s Board does, and oral arguments took place in several locales. Amazingly the Board found Hawaii a convenient place for oral arguments. Nearly every year the Board heard oral arguments in Hawaii.

Ronald Reagan’s election brought a very different perspective to the Department of Labor. Ray Donovan became Secretary of Labor, and following the philosophical lead of the President, he clamped down on what he viewed as excesses. [The story here is apocryphal. I have no hard proof; however, many informed people told me the same version.] Supposedly the BRB was warned not to go to Hawaii or the judges would be replaced. Despite this warning, the Board went to Hawaii, and in 1982 Judges Kalaris and Miller were fired. They sued in federal district court in Washington, D.C., claiming, among other positions, that they were actually Article III judges (similar to U. S. district and circuit judges) who were entitled to life tenure during good behavior. Those were the heady days of judicial activism, and a federal district judge agreed that they could not be terminated without cause, and he enjoined the Secretary of Labor from removing them.

The government appealed, and together with a local claimant’s attorney, I filed an amicus curiae brief in the case supporting Judges Kalaris and Donovan. Even if they were not Article III judges, we contended that since they reviewed decisions of ALJ’s who had supposed life tenure during good behavior and their decisions were reviewed by Article III judges it would be incongruous for only these judges to serve at the pleasure of the Secretary of Labor. The decision in Kalaris v. Donovan, 697 F.3d 376 (D.C. Cir.), cert. denied, 462 U.S. 1119 (1983), supported the administration’s view that BRB judges served at the pleasure of the Secretary of Labor. This was a different time. Judge J. Skelly Wright, author of the opinion, was one of the most liberal circuit judges of his time. He did his job, though, and followed the law. The result of this decision was that BRB members would be replaced at will by the Secretary of Labor. Many feared that the Board would become a political tool of the incumbent party and President. Experience shows those fears were exaggerated. The only thing party change has brought is a change in the Chief Administrative Appeals Judge. During the Clinton administration Betty Jean Hall, who had been a coal union lawyer, was appointed to the Board and named Chief Judge. During the Bush years, Judith Boggs, a former coal lobbyist/lawyer, was named Chief Judge, and when Obama took office, Judge Hall rotated back into the chief’s role. 18 months into President Trump’s term, she remains.

BRB tenure has seemed a very small issue over the decades. Finding people to fill slots has taken time, but once in, BRB judges seem to stick around. Judges Nancy Dolder and Roy Smith were appointed in the mid-80’s and worked nearly 30 years (Judge Dolder took a few years off for another administrative appointment during the Bush years and then returned to the Board), and when they retired, their seats were taken by coal-connected appointees. There are no current judges with any maritime private practice experience, and indeed the maritime industry seems unable to organize enough to push a nominee. The coal industry and unions have dominated selection, since the BRB also hears Black Lung Act appeals.

In Kalaris v. Donovan, Judge Wright briefly adverted to the possibility that BRB judges were “officers of the United States” who required executive appointment. He dismissed that notion in passing. With Lucia on the books now, one wonders if the BRB judges, who review decisions of ALJ’s, now held to be “officers of the United States” under the Constitution and whose decision are reviewed by Article III judges will now be held to be similarly in need of Presidential/executive appointment. The Kalaris decision also referenced Crowell v. Benson, 285 U.S. 22 (1932), a case in which the Supreme Court held that the Constitution’s admiralty and maritime jurisdiction power allowed Congress to dictate how maritime claims were adjudicated. At the time of Crowell, the longshore act only applied to injuries on vessels in navigable waters. Neither Kalaris nor any case I have found ever discusses the power of Congress to change the adjudication of land-based LHWCA claims or those of the extensions to the Longshore Act, viz., District of Columbia Compensation Act (until 1982), Defense Base Act, Non-appropriated Fund Instrumentalities Act, and the Outer Continental Shelf Lands Act.

While Lucia has been dissected by many commentators, the seeds of its decision were, I think, sown in the little-cited decision of the Supreme Court in Federal Maritime Commission v. South Carolina State Ports Authority, et al., 535 U.S. 743 (2002). Justice Thomas’s unanimous opinion addressed the question of whether the Eleventh Amendment prohibited an administrative proceeding against a state by a citizen of that state. Concluding that such actions were not permitted, the Court held that ALJ’s had many powers that Article III judges have, including awarding damages, finding contempt, subpoenaing witnesses, etc. Thus actions before these tribunals were the functional equivalent of a federal district court, and the Eleventh Amendment shielded states from being sued in federal court by their own citizens in administrative proceedings. [Note: Some federal court proceedings against states by their own citizens are permitted under the 13th, 14th, and 15th Amendments (Civil War Amendments), but those rights came after the Eleventh Amendment’s adoption.]

Will someone challenge the jurisdiction of BRB judges now Lucia is the law? If so, I believe their appointment defects, if any, can quickly be cured by a Presidential appointment. And like our experience with BRB judges show, I do not think that even if a President has the power to remove ALJ’s at will, that it will happen. Although 52 ALJ slots are authorized, Congress has only appropriated enough funds to pay 42. Given the short-handed number of judges, replacing any of them unilaterally will just slow the processing of claims. I do not think the sky is falling, and I believe we will continue under the current system, hopefully attracting quality ALJ’s who will be of similar caliber as the hard working ALJ’s we have today.

© Copyright 2018 Thomas C. Fitzhugh, III. All rights reserved. Reprinted with permission. This article will appear in an upcoming issue of Benefits Review Board Service Longshore Reporter (LexisNexis).