No Fraud in Coal Firm's Legal Maneuverings
(CN) - A West Virginia coal company did not defraud the family of a deceased miner by withholding evidence in a black lung disease benefits case, the 4th Circuit ruled.
The evidence in question involves two pathology reports that diagnosed miner Gary Fox with the irreversible pulmonary condition known as pneumoconiosis.
Although it described the company's behavior as "hardly admirable," a three-judge panel of the Richmond, Va.-based federal appeals court nevertheless concluded that the failure to disclose the reports "did not, under clear Supreme Court and circuit precedent, demonstrate the commission of a fraud upon the court."
Fox, who had worked as a coal mine his entire adult life, originally filed a claim for benefits under the Black Lung Benefits Act in 1999, shortly after his pathologist identified a mysterious black mass revealed in an x-ray of his right lung as an inflammatory "pseudo tumor."
After the district director of the U.S. Department of Labor granted Fox's claim, Elk Run requested a hearing before an administrative law judge.
In the meantime, the company acquired its own set of slides from Fox's procedure and submitted them to several radiologists and two other pathologists to review.
The Fox family would go on to allege that Elk Run was unhappy with the pathologists' conclusions and advanced only the radiologists' findings and Fox's original diagnosis of an inflammatory pseudo tumor to four pulmonary specialists who concluded that Fox was not suffering from black lung disease.
Black lung disease is caused by lengthy exposure to coal dust. Under the Black Lung Benefits Act, coal companies have to compensate miners and their families if they have been determined to have the disease.
At the hearing before the administrative law judge, Fox appeared pro se, explaining that he had not been able to find an attorney to represent him.
Elk Run submitted the reports from its pulmonary specialists, but did not disclose the existence of the two pathologists' reports to either the administrative law judge or to Fox, according to the 4th Circuit's recitation of the case.
Based on the evidence before him, the administrative law judge denied the miner's request for benefits in 2001.
Nearly six years later, Fox filed a new claim and was again deemed eligible, prompting Elk Run to once again request an evidentiary hearing.
This time, however, Fox was represented by an attorney who conducted vigorous discovery and requested the company handover the pathology slides as well as any additional documents and reports it had pertaining to Fox's medical condition.
It was at this point that the two pathologists' reports came to light. Fox moved to have the administrative law judge's denial of his benefits set aside, arguing that Elk Run had committed fraud on the court because it had not disclosed the existence of the two reports.
Fox was dead two years by the time an administrative law judge concluded in 2011 that the pathologists had indeed diagnosed Fox with "complicated pneumoconiosis," and that Elk Run had engaged in a scheme to prevent the miner from receiving any benefits.
The judge set aside the earlier judgment and awarded Fox's widow benefits dating back to January 1997.
On appeal, a benefits review board accepted the factual findings of the administrative law judge, but concluded the company's conduct didn't rise to the level of fraud on the court.
The U.S. Supreme Court has defined fraud on the court as a deliberately planned and carefully executed scheme to undermine the integrity of judicial process. For the benefits review board said, Elk Run's actions simply didn't reach that high bar.
As a result, it said, Fox was only entitled to benefits beginning in June 2006.
The 4th Circuit affirmed that conclusion Friday.
"We bestow no blessing and place no imprimatur on the company's conduct, other than to hold that it did not, under a clear chain of precedent, amount to a fraud upon the court," Judge J. Harvie Wilkinson wrote for the panel.
The 20-page ruling highlights the "self-policing" properties of the adversary process.
"The relevant provision of the APA contains no requirement that a party present the most probative evidence in its possession; instead, it is permitted to offer any evidence it would like so long as that evidence is relevant," Wilkinson wrote, abbreviating the Administrative Procedures Act.
Elk Run's lawyers with Jackson Kelly applauded the court's finding "that our client had no obligation to turn over reports from non-testifying consultants."
"As the court noted, under our legal system, parties on all sides of a dispute are entitled to effective representation," it added.
The Fox family's attorney Allan Karlin meanwhile voiced his disappointment.
Karlin emphasized in a statement how "the court did not endorse the firm's conduct nor did it consider or resolve the more important question as to whether the firm committed common law fraud."
"We are surprised that the court failed to appreciate the difficulty that Mr. Fox and so many other miners have in getting competent counsel in federal black lung claims to protect them from litigation tactics that undermine the pursuit of the truth," Karlin added.