Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca13-14-07093/USCOURTS-ca13-14-07093-0/pdf.json

Parties Involved:
American Legion
Petitioner
Robert A. McDonald
Respondent
Michael L. McKinney
Petitioner
Military Order of the Purple Heart
Petitioner
National Veterans Legal Services Program
Petitioner
Secretary of Veterans Affairs
Respondent
Vietnam Veterans of America
Petitioner

Document Text:

United States Court of Appeals 

for the Federal Circuit ______________________ 

MICHAEL L. MCKINNEY, THE NATIONAL 

VETERANS LEGAL SERVICES PROGRAM, THE 

MILITARY ORDER OF THE PURPLE HEART,

VIETNAM VETERANS OF AMERICA, THE 

AMERICAN LEGION,

Petitioners

v.

ROBERT A. MCDONALD, SECRETARY OF 

VETERANS AFFAIRS,

Respondent

______________________ 

2014-7093

______________________ 

Petition for review pursuant to 38 U.S.C. § 502.

______________________ 

Decided: August 11, 2015 

______________________ 

DANIELLE CHRISTINE DOREMUS, Paul Hastings LLP, 

San Francisco, CA, argued for petitioners. Also represented by STEPHEN BLAKE KINNAIRD, Washington, DC; 

PATRICK AARON BERKSHIRE, BARTON F. STICHMAN, National Veterans Legal Services Program, Washington, DC. 

MARTIN F. HOCKEY, JR., Commercial Litigation 

Branch, Civil Division, United States Department of 

Justice, Washington, DC, argued for respondent. Also 

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2 MCKINNEY v. MCDONALD

represented by JOYCE R. BRANDA, ROBERT E. KIRSCHMAN,

JR.; MARTIE ADELMAN, DAVID J. BARRANS, Office of General Counsel, United States Department of Veterans 

Affairs, Washington, DC. 

______________________ 

Before O’MALLEY and WALLACH, Circuit Judges, and 

GILSTRAP, District Judge.*

O’MALLEY, Circuit Judge.

Michael L. McKinney, National Veterans Legal Services Program, Military Order of the Purple Heart, Vietnam Veterans of America, and The American Legion 

(collectively, “Petitioners”) petition this court under 38 

U.S.C. § 502 to review the effective date that the Department of Veterans Affairs (“VA”) assigned to 38 C.F.R. 

§ 3.307(a)(6)(iv) (“the 2011 regulation”), a regulation that 

provides a presumption of herbicide exposure for certain 

veterans who served in or near the Korean demilitarized 

zone (“DMZ”) during the Vietnam era. Petitioners challenge the VA’s decision to make the regulation effective 

prospectively, rather than assigning a retroactive effective 

date. Petitioners also challenge the VA’s denial of their 

petition for rulemaking to amend the effective date of the 

2011 regulation. Because the VA’s decision to assign the 

2011 regulation a prospective effective date was not 

arbitrary, capricious, or contrary to law, we deny the 

petition for review. 

* The Honorable Rodney Gilstrap, District Judge, 

United States District Court for the Eastern District of 

Texas, sitting by designation.

 

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MCKINNEY v. MCDONALD 3

BACKGROUND

A. Veterans Benefits Act of 2003

During the Vietnam War, herbicides were applied 

near the Korean DMZ from April 1968 to July 1969. In 

2003, Congress passed the Veterans Benefits Act, which 

authorized benefits for children with spina bifida born to

certain Korean service veterans. Veterans Benefits Act of 

2003, Pub. L. No. 108-183, 117 Stat. 2651 (2003) (codified 

at 38 U.S.C. § 1821). In relevant part, the Act defines “a 

veteran of covered service in Korea” as “any individual” 

who: (1) served “in or near” the Korean DMZ as determined by the Secretary of the VA, in consultation with the 

Department of Defense (“DoD”), between September 1, 

1967 and August 31, 1971; and (2) is determined by the 

Secretary, in consultation with the DoD, “to have been 

exposed to a herbicide agent during such service in or 

near the Korean [DMZ].” 38 U.S.C. § 1821(c). Although 

Congress knew that herbicide use near the Korean DMZ 

ended in 1969, it extended the covered period through 

August 1971 to account for residual exposure. See 149 

Cong. Rec. S15133-01 (daily ed. Nov. 19, 2003) (“[E]ven 

though herbicide use in or near the Korean DMZ ended in 

1969, the Committees believe it is appropriate to extend 

the qualifying service period beyond 1969 to account for 

residual exposure.”).

B. VBA Manual Rules 

In 2003, the Veterans Benefits Administration 

amended its Adjudication Procedure Manual (“VBA 

Manual”) to state that “[h]erbicide agents were used along 

the southern boundary of the [DMZ] in Korea between 

April 1968 and July 1969,” and that the DoD “has identified specific units that were assigned or rotated to areas 

along the DMZ where herbicides were used.” Historical 

VBA Manual M21-1, part VI, ch. 7, para. 7.20.b.2. The 

VBA Manual indicated that herbicide exposure would be 

conceded for veterans who served in the units DoD identiCase: 14-7093 Document: 58-2 Page: 3 Filed: 08/11/2015
4 MCKINNEY v. MCDONALD

fied between April 1968 and July 1969 (“the 2003 manual 

rule”). Id. 

On November 1, 2004, VBA revised the VBA Manual 

to implement the provisions of the Veterans Benefits Act 

of 2003 providing benefits for “individuals born with spina 

bifida who are the children of veterans who served with 

specific units in or near the DMZ in Korea between September 1, 1967 and August 31, 1971.” VBA Manual 

Rewrite M21-1MR, part VI, ch. 2, § B (Nov. 1, 2004); Joint 

Appendix (J.A.) 69. Like the 2003 manual, the 2004 

revision continued to provide that the VA would concede 

that certain veterans who served in areas along the 

Korean DMZ when the herbicides were applied—between 

April 1968 to July 1969—were exposed to herbicides for 

purposes of their personal claims for benefits connected to 

such exposure. J.A. 74. 

C. Proposed 38 C.F.R. § 3.307(a)(6)(iv)

In 2009, the VA published a proposed rule in the Federal Register to amend its regulations to incorporate 

relevant provisions of the Veterans Benefits Act of 2003. 

Herbicide Exposure and Veterans with Covered Service in 

Korea, 74 Fed. Reg. 36,640 (proposed July 24, 2009) (to be 

codified at 38 C.F.R. pt. 3). The VA explained that 38 

U.S.C. § 1821 “authorizes recognition of herbicide exposure for ‘certain Korean service veterans’ for purposes of 

providing benefits to a child born to them with spina 

bifida.” Id. at 36,641. Based on information received 

from DoD, the VA proposed to “presume herbicide exposure for any veteran who served between April 1968 and 

July 1969 in a unit determined by VA and DoD to have 

operated in an area in or near the Korean DMZ in which 

herbicides were applied.” Id. The VA also proposed that, 

if a veteran “served in or near the Korean DMZ during the

period between September 1, 1967, and August 31, 1971, 

but not within the time periods and geographic locations 

that would qualify for a presumption of exposure under 

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MCKINNEY v. MCDONALD 5

this proposed rule, such service would qualify for benefits 

under 38 U.S.C. § 1821 only if VA determines that the 

veteran was actually exposed to herbicides during such 

service.” Id. at 36,642. 

In the notice of proposed rulemaking, the VA explained that there “is currently no specific statutory 

authority for providing a presumption of exposure to 

herbicide agents to veterans who served in Korea.” Id. 

Although the Veterans Benefits Act of 2003 is silent with 

respect to creating a presumption for the veterans themselves, as distinct from their children, the VA stated that 

it would be “illogical to conclude that the children with 

spina bifida of the covered veterans have the disability 

due to the veteran’s exposure to herbicide agents, but not 

to presume that the veteran himself was exposed to 

herbicide agents and merits VA benefits for any disabilities associated with that exposure.” Id. The VA found 

that “such a presumption would comport with known facts 

and congressional intent and is within VA’s general 

rulemaking authority under 38 U.S.C. 501.” Id. 

D. Final 38 C.F.R. § 3.307(a)(6)(iv)

After receiving comments regarding the proposed 

rules, the VA published a final rule notice on January 25, 

2011, extending the time period in which herbicide exposure is presumed from April 1, 1968 to July 31, 1969 to 

April 1, 1968 to August 31, 1971. Herbicide Exposure and 

Veterans with Covered Service in Korea, 76 Fed. Reg. 

4245, 4245-46 (Jan. 25, 2011). In adopting this change, 

the VA explained that “it is reasonable and consistent 

with the intent of Congress to concede exposure for veterans who served in or near the Korean DMZ after herbicide 

application ceased, because of the potential for exposure 

to residuals of herbicides applied in that area.” Id. at 

4245 (citing 149 Cong. Rec. H11705-01 (2003) (noting that 

“it is appropriate to extend the qualifying service period 

beyond 1969 to account for residual exposure”), see also

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149 Cong. Rec. S15133-01 (2003)). Accordingly, the VA 

revised 38 C.F.R. § 3.307(a)(6)(iv) “to presume herbicide 

exposure for veterans who served in or near the Korean 

DMZ between April 1, 1968, the earliest date of potential 

exposure indicated by DoD, and August 31, 1971, the date 

identified by Congress” in the Veterans Benefits Act of 

2003 as a reasonable outside date for residual exposure. 

Id. at 4246.

The final rule was effective February 24, 2011, and 

made applicable “to all applications for benefits that are 

received by VA on or after February 24, 2011 and to all 

applications for benefits that were pending before VA, the 

United States Court of Appeals for Veterans Claims, or 

the United States Court of Appeals for the Federal Circuit 

on February 24, 2011.” Id. at 4245. 

E. McKinney’s Claim for Benefits 

Petitioner Michael McKinney filed a claim in 2010 for 

service connection based on exposure to Agent Orange 

during his service along the DMZ, which began in August 

1969. The VA Regional Office (“RO”) denied his claim 

based on the applicable VBA manual rule, which established a presumption of exposure to Agent Orange for 

those who served in the DMZ between April 1, 1968 to 

July 31, 1969. Notably, that period of presumed exposure 

expired one month prior to McKinney’s service in the 

DMZ. While McKinney’s claim was still pending, the VA 

finalized the 2011 regulation, which extended the presumed exposure period to and including August 31, 1971. 

In March 2012, the RO granted McKinney’s 2010 

claim for service connection pursuant to the 2011 regulation, but denied him an effective date earlier than the 

regulation’s February 24, 2011 effective date. McKinney 

v. Shinseki, No. 12-3639, 2013 WL 2902799, at *1 (Vet. 

App. June 14, 2013). As a result, McKinney received 

benefits for the post-2011 portion of his claim based on 

the 2011 regulation’s presumption of exposure, but was 

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MCKINNEY v. MCDONALD 7

denied pre-2011 benefits based on a lack of evidence of 

service connection. Petitioners’ Br. 11. 

In December 2012, McKinney filed with the United 

States Court of Appeals for Veterans Claims (“Veterans 

Court”) a “petition for an order to eliminate the inequity 

in the law that would permit the Secretary to avoid 

applying a favorable precedential decision in Mallory v. 

Shinseki, No. 11-0401, to the claims of petitioner and 

other similarly situated claimants.” McKinney, 2013 WL 

2902799, at *1. Mallory was an action then-pending 

before the Veterans Court.1 The Veterans Court dis1 In Mallory, the veteran alleged that he had three 

conditions due to herbicide exposure in the Korean DMZ, 

but was denied benefits under the VBA manual rule 

because his service took place outside the period of presumed exposure. See Mallory v. Shinseki, No. 11-401-E, 

2014 WL 4231304, at *1 (Vet. App. Aug. 27, 2014). After 

the 2011 regulation went into effect, Mallory filed a brief 

arguing that the manual rule “relied upon by the Board in 

denying [his] claims should be set aside as arbitrary, 

capricious, and contrary to law and the Board’s reliance 

upon that provision deprived him of due process.” Id. In 

July 2013, the parties entered into a settlement agreement which awarded Mallory service connection based on 

the date of his various claims. A footnote in the settlement agreement stated that, “[n]otwithstanding the 

absence of any binding precedential effect of this agreement,” the VA anticipated that, “should there be similarly 

situated appeals to the [Veterans Court], those Appellants 

would receive similar treatment.” J.A. 86 n.2. Despite 

this footnote, the text of the settlement agreement stated 

that “[b]oth parties agree that this settlement is based on 

the unique facts of this case and in no way should be 

interpreted as binding precedent for the disposition of 

future cases.” J.A. 86.

 

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missed McKinney’s petition for lack of jurisdiction based 

on his lack of standing. Id. at *3 (finding that McKinney’s 

petition did not “seek to remedy a past injury,” but rather 

sought “to prevent a potential injury that may arise if 

(1) this Court in Mallory issues a precedential decision 

that would entitle him to an earlier effective date for VA 

benefits, and (2) his claim becomes finally adjudicated 

before that decision issues”). McKinney appealed to this 

court, but filed a motion to voluntarily dismiss his appeal, 

which this court granted in November 2013. Order, 

McKinney v. Shinseki, No. 13-7141 (Fed. Cir. Nov. 5, 

2013), ECF No. 11.

F. Petition for Rulemaking

On January 28, 2014, Petitioners sent a letter to the 

Secretary of the VA requesting that he change the effective date of the 2011 regulation from February 24, 2011 to 

November 1, 2004, the date of the 2004 revision to the 

VBA Manual. J.A. 32. Petitioners also requested that the 

VA stay the regulation’s effective date as to nonfinal 

claims of affected veterans. Although Petitioners recognized that the 2011 regulation’s expansion of the “presumptive exposure window was a welcome rule change,” 

they argued that it was “arbitrary and capricious for the 

DVA not to apply the same presumption to all timely filed 

claims for benefits.” J.A. 34. 

In a letter dated July 10, 2014, the VA construed Petitioners’ letter as a petition for rulemaking under 5 U.S.C. 

§ 553(e), and denied Petitioners’ request to revise the 

2011 regulation’s effective date. J.A. 8. In that letter, the 

Acting VA General Counsel explained that the “2011 

amendment to section 3.307(a)(6) was a liberalizing 

substantive rule, which established a presumption of 

herbicide exposure not required by any statute.” Id. The 

VA further stated that the effective date selected was 

consistent with its “usual and longstanding practice 

[which] is to make such substantive rules effective proCase: 14-7093 Document: 58-2 Page: 8 Filed: 08/11/2015
MCKINNEY v. MCDONALD 9

spectively from the date that is thirty days after the date 

of their publication in the Federal Register,” and that this 

approach “ensures that all new liberalizing regulations 

are applied in a fair, consistent, and efficient manner.” 

Id. 

Next, the VA indicated that the 2011 regulation’s

February 24, 2011 effective date is consistent with 38 

U.S.C. § 5110(g), which provides, in part, that “where 

compensation . . . is awarded or increased pursuant to any 

Act or administrative issue, the effective date of such 

award or increase shall be fixed in accordance with the 

facts found but shall not be earlier than the effective date 

of the Act or administrative issue.” J.A. 11. The VA 

further explained that retroactivity is not favored in the 

law, and agencies have limited authority to issue retroactive regulations. Indeed, the VA promulgated 

§ 3.307(a)(6)(iv) pursuant to 38 U.S.C. § 501(a)—which 

provides the Secretary of Veterans Affairs the authority to 

prescribe all “necessary” and “appropriate” rules to carry 

out the laws administered by the VA—and nothing contained therein expressly authorizes retroactive regulations. J.A. 12. 

Finally, the VA noted that assigning the 2011 regulation an earlier effective date could give rise to administrative burdens and confusion in adjudicating claims. For 

example, a retroactive effective date might make it difficult for adjudicators assessing the finality of a claim to 

determine which regulations were in effect at the time of 

the prior decision. J.A. 14. For these reasons, the VA 

declined to change the 2011 regulation’s effective date.2 

Petitioners timely petitioned this court for review. 

2 With respect to the language in the settlement 

agreement in the Mallory case, the VA disagreed with 

Petitioners’ argument that “[v]eterans falling under the 

 

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DISCUSSION

This case arises under our original jurisdiction pursuant to 38 U.S.C. § 502, which provides that: 

An action of the Secretary to which section 

552(a)(1) or 553 of this title 5 (or both) refers is 

subject to judicial review. Such review shall be in 

accordance with chapter 7 of title 5 and may be 

sought only in the United States Court of Appeals 

for the Federal Circuit. 

38 U.S.C. § 502. Under this statute, we have jurisdiction 

to review “the VA’s procedural and substantive rules, any 

amendments to those rules, and the process in which 

those rules are made or amended.” Disabled Am. Veterans v. Gober, 234 F.3d 682, 688 (Fed. Cir. 2000) (“DAV”). 

We review petitions under § 502 in accordance with 

the standard set forth in the Administrative Procedure 

Act (“APA”), 5 U.S.C. §§ 701-706. See Nyeholt v. Sec’y of 

Veterans Affairs, 298 F.3d 1350, 1355 (Fed. Cir. 2002) 

(citing DAV, 234 F.3d at 691). The APA requires a reviewing court to “decide all relevant questions of law, 

interpret constitutional and statutory provisions, and 

determine the meaning or applicability of the terms of an 

agency action.” 5 U.S.C. § 706. The court will “hold 

same exposure window as Mallory should be granted 

similar relief from the 2004 manual rule.” J.A. 14. Although the settlement agreement noted that the VA anticipated “similarly situated appeals” would receive “similar 

treatment,” the VA explained that the meaning of the 

phrase “similar treatment” in the footnote is ambiguous, 

and the text of the agreement made clear that it was 

based on the “unique facts of this case.” Id. As such, the 

VA found nothing in the settlement agreement supporting 

Petitioners’ request for an earlier effective date for the 

2011 regulation. 

 

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MCKINNEY v. MCDONALD 11

unlawful and set aside agency action” that is “arbitrary, 

capricious, an abuse of discretion, or otherwise not in 

accordance with law.” 5 U.S.C. § 706(2)(A); see Mortg. 

Investors Corp. v. Gober, 220 F.3d 1375, 1378 (Fed. Cir. 

2000). “This review is ‘highly deferential’ to the actions of 

the agency.” DAV, 234 F.3d at 691 (citing LeFevre v. 

Sec’y, Dep’t of Veterans Affairs, 66 F.3d 1191, 1199 (Fed. 

Cir. 1995)). 

On appeal, Petitioners argue that the 2011 regulation’s effective date is arbitrary and capricious and contrary to law. According to Petitioners, the regulation’s 

effective date: (1) is inconsistent with the VA’s obligations 

under the “basic entitlement” statute—38 U.S.C. § 1110—

because it denies veterans mandatory benefits for serviceconnected injuries; and (2) irrationally creates the potential for two conflicting evidentiary standards to apply to a 

single pending claim. 

As to the first point, Petitioners argue that, under 

§ 1110, the VA is obligated to compensate veterans once it 

has determined that a veteran has a service-connected 

disability, but the 2011 regulation’s effective date precludes compensation prior to February 24, 2011 for Korean DMZ veterans who cannot prove actual exposure to 

herbicides, do not satisfy the service requirements in the 

2003 manual rule, and filed claims before that date. 

Petitioners’ Br. 24-25. As to the second point, Petitioners 

argue that the February 24, 2011 effective date leads to 

the VA’s application of two different standards for the 

same veteran based on the same service: “[o]n the one 

hand, the [VA] will determine that a veteran is not entitled to compensation for pre-2011 benefits because he 

failed to prove herbicide exposure,” while “[o]n the other, 

the [VA] will find that the same veteran is entitled to 

post-2011 benefits because under the 2011 regulation 

exposure is presumed.” Petitioners’ Br. 30-31. According 

to Petitioners, “no law requires this result.” Id. at 31. 

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While these arguments are not without some force, 

the scope of our review under the “arbitrary and capricious” standard is narrow, and “a court is not to substitute 

its judgment for that of the agency.” Motor Vehicle Mfrs. 

Ass’n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 

(1983). That said, “the agency must examine the relevant 

data and articulate a satisfactory explanation for its 

action.” Id. A regulation is not arbitrary or capricious if 

there is a “rational connection between the facts found 

and the choice made.” Id. (citation and quotation marks 

omitted); Nat’l Org. of Veterans’ Advocates, Inc. v. Sec’y of 

Veterans Affairs, 669 F.3d 1340, 1348 (Fed. Cir. 2012). 

Applying this highly deferential standard of review, 

we conclude that the VA adequately explained the facts 

and policy matters underlying its denial of Petitioners’

request for rulemaking to change the effective date of the 

2011 regulation. In responding to Petitioners’ request for 

rulemaking, the VA explained that “[r]etroactivity is not 

favored in the law” and thus “congressional enactments 

and administrative rules will not be construed to have 

retroactive effect unless their language requires this 

result.” J.A. 11-12 (quoting Bowen v. Georgetown Univ. 

Hosp., 488 U.S. 204, 208 (1988) (quotation marks omitted)). Further, “a statutory grant of legislative rulemaking authority will not, as a general matter, be understood 

to encompass the power to promulgate retroactive rules 

unless that power is conveyed by Congress in express 

terms.” Bowen, 488 U.S. at 208. 

It is well established that “‘the standard for finding 

such unambiguous direction is a demanding one.’” Bernklau v. Principi, 291 F.3d 795, 805 (Fed. Cir. 2002) (quoting INS v. St. Cyr, 533 U.S. 289, 316 (2001)). For 

example, in Liesegang v. Secretary of Veterans Affairs, 312 

F.3d 1368 (Fed. Cir. 2002), we explained that “settled and 

binding precedent preclude[d] us from giving retroactive 

effect to the regulation” at issue, which created a presumption of service connection for Vietnam veterans who 

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developed type-2 diabetes. Id. at 1377, n.1. In Liesegang, 

we found that 38 U.S.C. § 1116, which authorized the 

regulation at issue, did not contain “express and unambiguous permission” for VA to issue a retroactive regulation. Id. 

In its letter denying Petitioners’ request for rulemaking, the VA explained that it issued the 2011 regulation 

pursuant to 38 U.S.C. § 501(a), which provides the Secretary with the ability to prescribe all “necessary” and 

“appropriate” rules to carry out the laws administered by 

the VA, including “regulations with respect to the nature 

and extent of proof and evidence and the method of taking 

and furnishing them in order to establish the right to 

benefits under such laws.” 38 U.S.C. § 501(a)(1). As the 

VA explained, that statute provides no express and unambiguous permission to issue retroactive regulations. 

The VA further indicated that, “[a]lthough there may be 

exceptional circumstances in which it may be appropriate 

to assign a retroactive effective date to a particular regulation, it would be inappropriate and inconsistent with 

section 5110(g) to do so as a routine matter.”3 J.A. 12. 

Therefore, despite Petitioners’ suggestion to the contrary, 

3 Section 5110(g) provides, in part, that:

where compensation . . . is awarded or increased 

pursuant to any Act or administrative issue, the 

effective date of such award or increase shall be 

fixed in accordance with the facts found but shall 

not be earlier than the effective date of the Act or 

administrative issue. In no event shall such 

award or increase be retroactive for more than one 

year from the date of application therefor or the 

date of administrative determination of entitlement, whichever is earlier. 

38 U.S.C. § 5110(g).

 

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the VA did not state that “its hands were tied on the 

effective date by section 5110(g).” Petitioners’ Br. 20. 

Instead, the VA concluded that it was not appropriate to 

assign a retroactive date “as a routine matter,” and that 

there was no basis for doing so here. 

As the government points out, moreover, the issue before us is not whether the VA could have assigned a 

retroactive effective date to the 2011 regulation, but 

rather, whether the VA acted arbitrarily and capriciously 

in assigning a prospective date. In its letter denying 

Petitioners’ request for rulemaking, the VA explained 

that assigning a retroactive effective date “would potentially create administrative concerns affecting VA’s ability 

to adjudicate claims in a fair, consistent, and efficient 

manner.” J.A. 13. The VA further indicated that “it 

would be unfair for VA to assign a retroactive effective 

date to the 2011 regulation . . . while not similarly assigning a retroactive effective date to other regulations VA 

issues that establish entitlement to benefits for other 

groups of Veterans.” Id. And, because assigning a retroactive effective date would be contrary to the VA’s standard practice, “it would create potential confusion among 

both claimants and adjudicators, increasing the complexity of adjudications and the potential for errors and inconsistent results.” Id. There is nothing arbitrary or 

capricious in that analysis. 

As noted, Petitioners argue that the VA’s assignment 

of a prospective effective date contravenes 38 U.S.C. 

§ 1110, which authorizes the VA to provide compensation 

to veterans for service-connected disability.4 But § 1110

4 Section 1110 provides, in part: 

For disability resulting from personal injury suffered or disease contracted in line of duty . . . in 

the active military, naval, or air service, during a 

 

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MCKINNEY v. MCDONALD 15

does not address the effective date for an award of compensation, and Petitioners cite no statutory authority 

requiring the VA to assign retroactive effective dates to its 

regulations. Finally, we agree with the government that 

the 2011 regulation’s effective date is not arbitrary or 

capricious simply because it may require application of 

different standards for different time periods. Indeed, the 

text of § 5110(g) itself makes clear that, if an award is 

based on a liberalizing statute or regulation issued while 

the claim was pending, the effective date of the award 

“shall not be earlier than the effective date of the Act or 

administrative issue.” 38 U.S.C. § 5110(g). And, we find

nothing inherently arbitrary or capricious about “applying 

intervening changes in law to different time periods 

covered by a scheme of benefits payable on an ongoing 

monthly basis.” Respondent’s Br. 37. 

To the extent Petitioners imply that the VA failed to 

comply with at least the spirit of the Mallory settlement, 

that is not a complaint we can address. While the VA’s 

explanation for its failure to treat other claimants as it 

did Mr. Mallory is less than persuasive, the VA is correct 

that its agreement in Mallory contained some room for 

non-compliance in a given case. And, to the extent the VA 

arguably has breached that settlement agreement, it is 

Mr. Mallory who would have standing to allege such a 

breach, and who would be required to establish injury 

flowing therefrom.

period of war, the United States will pay to any 

veteran thus disabled and who was discharged or 

released under conditions other than dishonorable 

from the period of service in which said injury or 

disease was incurred, or preexisting injury or disease was aggravated, compensation as provided in 

this subchapter . . . . 

38 U.S.C. § 1110.

 

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16 MCKINNEY v. MCDONALD

While we, individually or collectively, may have chosen this regulation as one deserving of retroactive treatment, that is not the question before us. We have

carefully considered all of Petitioners’ arguments and find

that Petitioners have failed to show that the VA acted 

arbitrarily or capriciously in assigning the 2011 regulation a prospective effective date.5 

CONCLUSION

For the foregoing reasons, we conclude that the effective date of 38 C.F.R. § 3.307(a)(6)(iv) is not arbitrary, 

capricious, or in violation of law. We therefore deny this 

petition for review. 

DENIED

5 Petitioners contend that, “[f]or the same reasons 

the 2011 regulation’s effective date is arbitrary and 

capricious under 5 U.S.C. § 706(2)(A), it also violates 

veterans’ Fifth Amendment rights.” Petitioners’ Br. 37. 

Petitioners present no additional arguments regarding 

their constitutional claims. Given our conclusion that the 

regulation’s effective date is not arbitrary and capricious, 

we find the Petitioners’ constitutional arguments without 

merit. 

 

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