UNITED STATES COURT OF APPEALS FOR VETERANS CLAIMS

No. 16-2174

KEVIN R. GEORGE, APPELLANT,

V.

ROBERT L. WILKIE,

SECRETARY OF VETERANS AFFAIRS, APPELLEE.

On Appeal from the Board of Veterans' Appeals

(Decided January 4, 2019)

Kenneth M. Carpenter, of Topeka, Kansas, was on the brief for the appellant.

Meghan Flanz, Interim General Counsel; Mary Ann Flynn, Chief Counsel; Richard A. 

Daley, Deputy Chief Counsel; and Mark D. Gore, all of Washington, D.C., were on the brief for 

the appellee.

Before DAVIS, Chief Judge, and BARTLEY and MEREDITH, Judges.

Davis, Chief Judge, filed the opinion of the Court. BARTLEY, Judge, filed a dissenting 

opinion.

DAVIS, Chief Judge: U.S. Marine Corps veteran Kevin R. George appeals through counsel 

a March 1, 2016, Board of Veterans' Appeals (Board) decision that found no clear and 

unmistakable error (CUE) in a September 1977 Board decision that denied entitlement to VA 

disability compensation benefits for schizophrenia. Record (R.) at 2-14. On September 6, 2017, 

the Court issued a memorandum decision affirming the Board's decision. On September 19, 2017, 

Mr. George filed a motion for reconsideration. On October 27, 2017, the matter was referred to a 

panel of the Court. On November 15, 2017, the panel granted Mr. George's motion for 

reconsideration, withdrew the September 2017 memorandum decision, ordered the Secretary to 

respond to Mr. George's motion for reconsideration, and permitted Mr. George to reply to the 

Secretary's response. After considering the briefs, the motion for reconsideration, the Secretary's 

response to the motion, and Mr. George's reply, the Court will affirm the Board's March 2016 

decision.
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I. BACKGROUND

In June 1975, Mr. George enlisted in the U.S. Marine Corps. A week after enlistment, he 

was hospitalized and diagnosed with an acute situational reaction. R. at 6; see R. at 1172, 1289. In 

July 1975, Mr. George was discharged from the hospital and ultimately placed in a training 

platoon. The following month, a psychiatrist diagnosed Mr. George with paranoid schizophrenia. 

An August 1975 Medical Board Report confirmed the schizophrenia diagnosis, found that his 

condition preexisted service and was aggravated by service, and recommended referral to the 

Central Physical Evaluation Board for discharge. In contrast, the Physical Evaluation Board found 

that his condition preexisted service but was not aggravated by service. Mr. George was 

discharged from service in September 1975.

In December 1975, Mr. George filed a claim for benefits contending that his schizophrenia 

was aggravated by his military service. A May 1976 regional office (RO) decision denied his claim 

because his condition existed prior to service and there was an acute exacerbation but no permanent 

aggravation during service. In September 1977, the Board denied Mr. George's claim because his 

condition existed prior to service and was not aggravated during service. 

In December 2014, through current counsel, Mr. George filed a motion to revise the 

September 1977 Board decision on the basis of CUE. Mr. George alleged that the Board failed to 

correctly apply 38 U.S.C. § 311,

1

as VA did not rebut the presumption of sound condition with 

clear and unmistakable evidence that his condition was not aggravated by service. R. at 593. 

In the March 2016 decision on appeal, the Board found no CUE in the September 1977 

Board decision. The 2016 Board noted that the September 1977 Board "in conducting its 

presumption of soundness analysis under 3.304(b) (1977) . . . was not required to find clear and 

unmistakable evidence that the disability was not aggravated by service." R. at 5. The Board further 

acknowledged that the U.S. Court of Appeals for the Federal Circuit (Federal Circuit) held that 

section 1111, the presumption of soundness statute, requires clear and unmistakable evidence that 

a condition both existed prior to service and was not aggravated during service, see Wagner v. 

Principi, 370 F.3d 1089 (Fed. Cir. 2004), but stated that "judicial decisions that formulate new 

interpretations of the law subsequent to a VA decision cannot be the basis of a valid CUE claim." 

R. at 6. Relying on Jordan v. Nicholson, 401 F.3d 1296 (Fed. Cir. 2005), the Board explained that 

 

1 The presumption of soundness is now codified as 38 U.S.C. § 1111, but the statutory language is identical 

to the precursor statute, section 311.
3

the interpretation of the presumption of sound condition that the Federal Circuit "articulated in 

Wagner[] does not have retroactive application in a CUE case. Thus, the failure of the Board [in 

September 1977] to find that the [claimant's] condition was not clearly and unmistakably 

aggravated by service as part of its presumption of soundness analysis cannot be considered to be 

CUE." Id.

In its 2016 decision, the Board discussed the evidence before the Board in September 1977 

and concluded that there was evidence that Mr. George's schizophrenia existed prior to service, 

and conflicting evidence as to whether his condition was aggravated by service. The Board noted 

that the Medical Board had concluded that Mr. George's condition had its onset prior to service 

and that his disability was aggravated by service. R. at 8. In contrast, the Board pointed to the

August 1975 "Physical Evaluation Board Proceedings and Findings" form stating that Mr. 

George's condition preexisted service and was not aggravated by service.

The 2016 Board conceded that the September 1977 Board did not discuss the presumption 

of soundness statute, 38 U.S.C. § 311 (1977), discuss its implementing regulation, 38 C.F.R. 

§ 3.304(b) (1977), or explain how there was clear and unmistakable evidence that Mr. George's 

condition existed prior to service and was not aggravated by service. R. at 10. The 2016 Board 

stated, however, that even though the September 1977 Board erred, the error was not outcome 

determinative "because the Board nonetheless considered all relevant evidence of record at the 

time of its September 1977 decision." R. at 11. The 2016 Board concluded that Mr. George's 

allegation of CUE in the September 1977 decision is simply a disagreement with how the Board 

in 1977 weighed the evidence, which does not constitute CUE.

II. PARTIES' ARGUMENTS

On appeal, Mr. George argues that the Board in March 2016 erred in finding that, under 

38 C.F.R. § 3.304(b) (1977), the Board in September 1977 "was not required to find clear and 

unmistakable evidence that the disability was not aggravated by service." R. at 5. He contends that 

his CUE motion specifically challenged the application of section 311, a statute, and not the VA 

regulation in effect in 1977. Mr. George further points out that when a court interprets a statute, 

its interpretation is a statement of what the law has always been, which he argues renders the 

Board's dismissal of Wagner improper. See Appellant's Brief (Br.) at 5. He asserts that the 2016 

Board's reliance on Jordan is misplaced because that case does not address "whether the court's 
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interpretation of the statutory presumption of soundness had a retroactive effect on requests for 

revisions based on an allegation of [CUE] due to the Board's failure to correct[ly] apply the statute,

notwithstanding what the VA's regulatory interpretation of the statute may have been." Id. at 6. In 

support of this argument, Mr. George relies on the Federal Circuit's decision in Patrick v. Shinseki, 

668 F.3d 1325 (Fed. Cir. 2011).

The Secretary agrees that the 2016 Board erred in stating that the 1977 Board, "in 

conducting its presumption of soundness analysis under 3.304(b) (1977)[,] . . . was not required to 

find clear and unmistakable evidence that the disability was not aggravated by service." R. at 5. 

Further, the Secretary recognizes that the 2016 Board also erred in relying on Jordan, 401 F.3d at

1288-89. The Secretary explains that Jordan speaks only to an allegation of CUE based on a 

retroactive effect of a regulation's invalidity and the issue here is an allegation of CUE based on 

the Board's failure to properly apply the statute.

Despite the Board's error, the Secretary contends that it is evident from the decision that 

the 2016 Board conducted the proper analysis, because it recognized that the Board in 1977 was 

"bound by the requirement that there be clear and unmistakable evidence on the aggravation prong

of the analysis." Secretary's Br. at 8. The Secretary argues for the affirmance of the March 2016 

Board decision because Mr. George did not demonstrate that the Board's error in articulating an 

incorrect evidentiary standard in 1977 would have resulted in a manifestly changed outcome. The 

Secretary asserts that the 2016 Board explained that there was evidence before the Board in 1977 

rebutting both prongs of the presumption of soundness, that is, evidence that Mr. George had a 

preexisting condition and that his condition was not aggravated by service. See Secretary's Br. at 

10 (citing R. at 1282-84, 1289, 1294). Accordingly, the Secretary contends that the 2016 Board 

properly found no CUE in the 1977 Board decision.

III. ANALYSIS

Mr. George argues that there was CUE in the September 1977 Board decision because the 

Board misapplied the statutory presumption of soundness. He asserts that, had the presumption of 

soundness been correctly applied, VA would have been required to show by clear and 

unmistakable evidence that his condition existed prior to service and was not aggravated by 

service. Before addressing Mr. George's arguments, the Court will briefly discuss the statutory 

presumption of soundness, the statute and regulation providing for revision of Board decisions on 
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the basis of CUE, and the Federal Circuit's decisions in Wagner, Jordan, and Patrick, which 

provide the context to Mr. George's arguments. 

A. Presumption of Soundness

The presumption of soundness statute, in 1977, as today, stated:

[E]very veteran shall be taken to have been in sound condition when examined, accepted, 

and enrolled for service, except as to defects, infirmities, or disorders noted at the time of 

the examination, acceptance, and enrollment, or where clear and unmistakable evidence 

demonstrates that the injury or disease existed before acceptance and enrollment and was 

not aggravated by such service.

38 U.S.C. § 311 (1977) (now 38 U.S.C. § 1111). Because of Wagner, we now know that the 

presumption may be rebutted only with clear and unmistakable evidence of both preexistence and 

no aggravation. 370 F.3d at 1096. In 1977, however, the implementing regulation for this statute 

required the Secretary to rebut the presumption of soundness only with "clear and unmistakable 

(obvious or manifest) evidence [that] demonstrates that an injury or disease existed prior [to 

service]." 38 C.F.R. § 3.304(b) (1977). In 2003, VA invalidated this version of the regulation. See

VA Gen. Coun. Prec. 3-2003 (July 16, 2003). The regulation was amended, effective May 4, 2005, 

to incorporate the new interpretation requiring evidence of both preexistence and no aggravation. 

See 70 Fed. Reg. 23,027-01, 23,028 (May 4, 2005).

B. CUE: An Exception to Finality

Congress has enacted a statute allowing Board decisions to be challenged on the basis of 

CUE. See 38 U.S.C. § 7111. "CUE proceedings are fundamentally different from direct appeals," 

in that they are a limited statutory exception to the rule of finality. Robinson v. Shinseki, 557 F.3d 

1355, 1360 (Fed. Cir. 2009); see Disabled Am. Veterans v. Gober (DAV), 234 F.3d 682, 686-87

(Fed. Cir. 2000). CUE is a rare kind of error and allows final RO and Board decisions to be reversed 

or revised. 38 U.S.C. §§ 5109A, 7111; see DiCarlo v. Nicholson, 20 Vet.App. 52, 54-58 (2006); 

38 C.F.R. §§ 3.105, 20.1400-11 (2018).

To establish CUE, a claimant must show that either the facts known at the time were not 

before the adjudicator or the law then in effect was incorrectly applied, and an error occurred based 

on the record and the law that existed at the time the decision was made. Russell v. Principi, 

3 Vet.App. 310, 313-14 (1992) (en banc). The error must also have "manifestly changed the 

outcome" of the decision. Id.; see Bustos v. West, 179 F.3d 1378, 1380 (Fed. Cir. 1999). The 

Court's review of a Board decision finding no CUE in a prior final Board decision is limited to 
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determining whether the Board's finding was "arbitrary, capricious, an abuse of discretion, or 

otherwise not in accordance with law." 38 U.S.C. § 7261(a)(3)(A); Russell, 3 Vet.App. at 315.

VA's implementing regulation for section 7111, 38 C.F.R. § 20.1403(e), states that CUE 

"does not include the otherwise correct application of a statute or regulation where, subsequent to 

the Board decision challenged, there has been a change in the interpretation of the statute or 

regulation." The Federal Circuit affirmed VA's rulemaking authority and upheld § 20.1403(e) in 

DAV, 234 F.3d at 698 ("The new interpretation of a statute can only retroactively [a]ffect decisions 

still open on direct review, not those decisions that are final.").

C. Wagner, Jordan, and the Presumption of Soundness

After DAV, the Federal Circuit addressed § 3.304(b), section 1111's implementing 

regulation, in Wagner. In that case, the appellant appealed this Court's affirmance of a Board 

decision that determined that the presumption of soundness had been rebutted because the 

Secretary established with clear and unmistakable evidence that the appellant's injury preexisted 

service. This Court's decision was based on § 3.304(b), which allowed the presumption of 

soundness to be "rebutted solely by 'clear and unmistakable evidence that an injury or disease 

existed prior to service.'" Wagner, 370 F.3d at 1091 (quoting 38 C.F.R. § 3.304(b) (1999)). After 

the appellant filed his appeal to the Federal Circuit, VA's general counsel issued a precedential 

opinion stating that, to rebut the presumption of soundness, the Secretary must show with clear 

and unmistakable evidence that a claimant's disability preexisted service and was not aggravated 

by service. See VA Gen. Coun. Prec. 3-2003 (July 16, 2003). After examining the legislative 

history and the language of section 1111, the Federal Circuit agreed, holding that the Government 

must show both preexistence and no aggravation to rebut the presumption of soundness, consistent 

with the VA General Counsel's opinion. Wagner, 370 F.3d at 1096.

Following its decision in Wagner, the Federal Circuit turned to whether its invalidation of 

§ 3.304(b) had retroactive effect. In Jordan, the appellant had appealed a 1999 Board decision 

finding no CUE in a 1983 decision that, in turn, found the presumption of soundness had been 

rebutted pursuant to § 3.304(b). The appellant contended that the invalidation of § 3.304(b) in 

Wagner should apply retroactively such that the regulation was, in effect, not in existence at the 

time of the 1999 Board decision, thereby requiring the Board to consider whether both prongs of 

the presumption had been rebutted in 1983. The Federal Circuit rejected Mr. Jordan's argument 

that "invalidation of [the] regulation can retroactively affect final decisions." Jordan, 401 F.3d at 
7

1297. Instead, the Federal Circuit applied the rule announced in DAV, holding that "CUE does not 

arise from a new regulatory interpretation of a statute" and that, "because the 1983 Board decision 

was final, Mr. Jordan has no recourse for appeal through a CUE [motion]." Id. at 1299.

D. The Patrick Line of Cases2

One month after issuing Wagner, the Federal Circuit issued Patrick I, a nonprecedential 

decision, which began the Patrick line of cases. The Court will discuss this line of cases for context,

because Mr. George relies heavily on the Federal Circuit's decision in Patrick VI, a decision on 

attorney fees, as well as the Federal Circuit's nonprecedential decisions on the merits that preceded 

it. See Motion for Reconsideration at 5-10. In the Patrick cases, a veteran's widow argued that the 

Board erred in finding no CUE in a March 1986 Board decision because section 1111 requires 

clear and unmistakable evidence both that an injury or disease preexisted service and that any such 

injury or disease was not aggravated by service. See Patrick I, 103 F. App'x at 384. This Court 

affirmed the Board decision and the appellant appealed to the Federal Circuit.

In Patrick I, a nonprecedential decision, the Federal Circuit noted its then-recent decision 

in Wagner and remanded the matter for "further consideration" by this Court in light of that 

precedent. Id. at 385. The Federal Circuit also noted that Mrs. Patrick did not challenge the Board's 

finding that the Secretary had rebutted the preexistence prong but rather argued that the Secretary 

had not shown by clear and unmistakable evidence that there was no aggravation during service. 

Id. On remand, this Court again affirmed the Board decision, finding that the Federal Circuit, in 

its intervening decision in Jordan, had held "that the presumption-of-soundness interpretation 

articulated in Wagner . . . does not have retroactive application in a CUE case." Patrick II, 2006 

 

2 The Patrick line of cases, including precedential and nonprecedential decisions from both this Court and 

the Federal Circuit, is as follows: Patrick v. Principi (Patrick I), 103 F. App'x 383 (2004) (nonprecedential Federal 

Circuit decision remanding the case for this Court to consider Wagner); Patrick v. Nicholson (Patrick II), No. 99-916, 

2006 WL 318822 (Vet. App. Feb. 1, 2006) (single-judge decision of this Court affirming the 1999 Board decision 

finding no CUE in the March 1986 Board decision); Patrick v. Nicholson (Patrick III), 242 F. App'x 695 (Fed. Cir. 

2007) (nonprecedential Federal Circuit decision vacating this Court's affirmance of the 1999 Board decision); Patrick 

v. Peake (Patrick IV), No. 99-916, 2008 WL 331094 (Vet. App. Jan. 31, 2008) (single-judge decision of this Court 

remanding the case for the Board to provide an adequate statement of reasons or bases for its conclusion that Mr. 

Patrick's preexisting heart disorder did not permanently increase during service); Patrick v. Shinseki (Patrick V), 

23 Vet.App. 512 (2010) (panel decision of this Court denying Equal Access to Justice Act (EAJA), 28 U.S.C.

§ 2412(d), fees to Mrs. Patrick because it found that the Government's position was substantially justified); Patrick v. 

Shinseki (Patrick VI), 668 F.3d 1325 (Fed. Cir. 2011) (Federal Circuit's precedential reversal of the denial of EAJA 

fees to Mrs. Patrick for failure to adequately address the totality of the circumstances); Patrick v. Shinseki (Patrick 

VII), No. 08-10899(E), 2012 WL 1860869 (Vet. App. May 23, 2012) (single-judge decision following the Federal 

Circuit's guidance and finding the Secretary's position was not substantially justified).
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WL 318822, at *9 (citing Jordan, 401 F.3d at 1298-99). The appellant again appealed to the 

Federal Circuit. 

In Patrick III, another nonprecedential decision, the Federal Circuit stated that this Court 

had "misread[]" Jordan, which had "addressed whether a change in the regulatory interpretation 

of a statute had retroactive effect on CUE [motions], not whether [its] interpretation of the statute 

in Wagner had retroactive effect on CUE [motions]." 242 F. App'x at 697. The Federal Circuit 

further stated that its holding in Jordan was "limited" and explained that, "[u]nlike changes in 

regulations and statutes, which are prospective, [its] interpretation of a statute is retrospective in 

that it explains what the statute has meant since the date of enactment." Id. at 698 (citing Rivers v. 

Roadway Express, 511 U.S. 298, 312-13 (1994)). More specifically, the Federal Circuit stated that 

its "interpretation of [section] 1111 in Wagner did not change the law but explained what [section] 

1111 has always meant." Id. (emphasis omitted). The Federal Circuit expressly directed this Court 

on remand to consider Mrs. Patrick's CUE motion and if necessary "remand to the Board for a 

determination of whether the government has rebutted the presumption of soundness under 

[section] 1111 by providing clear and unmistakable evidence of no in-service aggravation of Mr. 

Patrick's heart disease." Patrick III, 242 F. App'x at 698. On remand, in Patrick IV, this Court 

vacated the Board decision and remanded the appellant's appeal, and she filed an application for 

attorney fees under EAJA. In Patrick V, this Court denied the application, finding that the 

Secretary's position was substantially justified; Mrs. Patrick again appealed to the Federal Circuit.

In the "Background" section of Patrick VI, the first and only precedential decision in this 

line of cases, the Federal Circuit summarized what it said in Patrick III about the limitations of 

Jordan and the effect of its pronouncement regarding section 1111 in Wagner. 668 F.3d at 1328-

29. In the "Discussion" section of Patrick VI, the Federal Circuit addressed whether EAJA fees 

were warranted, reversed this Court's finding that the Secretary's position was substantially 

justified, and remanded the matter for this Court to consider substantial justification using the 

totality of circumstances test.3Id. at 1334. The Federal Circuit included the following footnote:

Nor did the Veterans Court [in Patrick V] fully assess the question of whether the 

government was substantially justified in arguing, following our decisions in 

Wagner, 370 F.3d at 1094-96, and Patrick I, 103 F[.] App[']x[] at 384-85, that this 

court's interpretation of section 1111 did not apply retroactively in the context of a 

CUE claim. We soundly rejected this argument in Patrick III, where we explained 

 

3 This Court ultimately granted Mrs. Patrick's EAJA application in Patrick VII.
9

that[,] "[u]nlike changes in regulations and statutes, which are prospective, our 

interpretation of a statute is retrospective in that it explains what the statute has 

meant since the date of enactment." 242 F[.] App[']x[] at 698. We emphasized, 

moreover, that "our interpretation of § 1111 . . . did not change the law but 

explained what [section] 1111 has always meant," and should therefore be applied 

to Mrs. Patrick's claim alleging CUE in the [B]oard's previous decision denying her 

application for dependency and indemnity benefits. Id.

Patrick VI, 668 F.3d at 1333 n.6.

E. Retroactivity and CUE

This appeal involves the competing doctrines of finality and retroactivity. In civil cases, 

the need for finality limits the application of retroactivity. James B. Beam Distilling Co. v. Ga.

(Beam), 501 U.S. 529, 541 (1991) (citing Chicot Cty. Drainage Dist. v. Baxter State Bank, 

308 U.S. 371 (1940)). The Federal Circuit has held that "[p]rinciples of finality and res judicata

apply to agency decisions that have not been appealed and become final." Cook v. Principi, 

318 F.3d 1334, 1336 (Fed. Cir. 2002); see id. at 1339 ("The purpose of the rule of finality is to 

preclude repetitive and belated readjudication of veterans' benefit claims."). In Jordan, the Federal 

Circuit noted the importance of finality, commenting that the appellant's argument that § 3.304(b) 

was void ab initio did not "give adequate weight to finality of judgments" and citing Supreme 

Court cases that "denied attempts to reopen final decisions in the face of new judicial 

pronouncements or decisions finding statutes unconstitutional." 401 F.3d at 1299 (citing 

Reynoldsville Casket Co. v. Hyde, 514 U.S. 749, 752 (1995), for the proposition that new judicial 

interpretations of a statute apply to "all pending cases"). 

Generally, courts apply settled principles of law to the disputes before them but, "when the 

law changes in some respect," an argument for retroactivity arises. Beam, 501 U.S. at 534. A new 

rule of law is announced, in the civil context, when the court overrules past precedent or decides a 

case of first impression. Reynoldsville Casket Co., 514 U.S. at 763. Beam makes clear that the 

retroactive application of a judicial pronouncement of the law is not absolute. Rather, as the 

Supreme Court has expressly determined, the application of judicial retroactivity in civil cases is 

bound by principles of res judicata and limited to those cases open on direct review.4In Harper v. 

 

4

In the criminal context, the Supreme Court even distinguishes between applying new rules to cases open on 

direct review and those cases subject to collateral attack. New rules in criminal law are applied to cases open on direct 

review but not to those subject to collateral attacks. Compare Griffith v. Kentucky, 479 U.S. 314 (1987) (applying new 

rules retroactively to criminal cases on direct review), with Teague v. Lane, 489 U.S. 288 (1989) (holding that new 

rules will not relate back to criminal convictions challenged on habeas corpus grounds).
10

Virginia Department of Taxation, the Supreme Court, relying on Beam, held that, when a court

applies a "federal law to the parties before it, that rule is the controlling interpretation of federal 

law and must be given full retroactive effect in all cases still open on direct review." 509 U.S. 86, 

97 (1993) (emphasis added); see Beam, 501 U.S. at 535. 

Generally, there is little opportunity to collaterally attack final judgments in civil cases;

however, in the veterans law universe, limited collateral attacks on final decisions are authorized 

by statute. See Beam, 501 U.S. at 540 (determining whether to apply new rules to cases on direct 

appeal or cases arising collaterally is not a problem in the civil arena as "there is little opportunity 

for collateral attack of final judgments"); see also 38 U.S.C. § 7111; Cook, 318 F.3d at 1339

(noting that CUE is a statutory exception to the rule of finality). An allegation of CUE is a 

statutorily permitted collateral attack on final VA decisions, with allegations of CUE evaluated 

based on the law that existed at the time of the final decision. Russell, 3 Vet.App. at 314 ("A 

determination that there was a '[CUE]' must be based on the record and the law that existed at the 

time of the prior. . . decision."); see Willsey v. Peake, 535 F.3d 1368, 1373 (Fed. Cir. 2008) ("[T]he

record and the law as they existed at the time of the determination do not compel a finding of CUE 

in the 1983 determination.").

The Federal Circuit's interpretation of the presumption of soundness statute announced in 

Wagner is "an authoritative statement of what the statute meant before as well as after the decision 

of the case giving rise to that construction." Rivers, 511 U.S. at 312-13. We do not, as our 

dissenting colleague contends, find that Wagner contained a new interpretation of section 1111. 

Post at 17. Instead, as further explained below, we find that the Federal Circuit's announcement 

in Wagner in 2004 of what section 1111 means cannot defeat the finality of a 1977 Board decision, 

see Harper, 509 U.S. at 97. This is so because consideration of CUE requires the application of 

the law as it was understood at the time of the 1977 decision, see Willsey, 535 F.3d at 1373; Russell, 

3 Vet.App. at 314, and Wagner does not change how section 311 (now section 1111) was

interpreted or understood before it issued. Applying a statute or regulation as it was interpreted 

and understood at the time a prior final decision is rendered does not become CUE by virtue of a 

subsequent interpretation of the statute or regulation by this Court or the Federal Circuit. When 

VA proposed the CUE regulation, VA anticipated that "[a]n interpretation of a statute or regulation 

could, in light of future interpretations – whether by the General Counsel or a court – be viewed 
11

as erroneous. That would not, however, be the kind of error required for CUE, i.e., an error about 

which reasonable persons could not differ." 63 Fed. Reg. 27,534, 27,537 (May 19, 1998).

F. Application of Law to the Facts

Mr. George argues that the 2016 Board erred in stating that the 1977 Board was not

required to find clear and unmistakable evidence that his schizophrenia was not aggravated by 

service in light of the 1977 version of § 3.304(b). Appellant's Br. at 3. Although the Secretary 

concedes error in this regard, the Court does not agree. See Copeland v. Shinseki, 26 Vet.App. 86, 

90 n.4 (2012) (noting that the parties' agreement is not binding on the Court). In 1977, the Board 

was required to apply the law as it existed at that time, including § 3.304(b), requiring the Secretary 

to rebut the presumption of soundness with only clear and unmistakable evidence that an injury or 

disease existed before service. See 38 C.F.R. § 19.1 (1977) ("In its decisions, the Board is bound 

by the regulations of the Veterans Administration, instructions of the Administrator and precedent 

opinions of the chief law officer."). Consequently, it is not clear how the Board could have ignored 

this regulation or why the Board would have been required to find clear and unmistakable evidence 

of aggravation in 1977. This regulatory interpretation of the statutory presumption of soundness,

requiring the Secretary to rebut the presumption only with clear and unmistakable evidence that a 

disability preexisted service, prevailed until 2003. See Doran v. Brown, 6 Vet.App. 283, 286 

(1994) (holding that the presumption of soundness "can be overcome only by clear and 

unmistakable evidence that a disability existed prior to service"); Bagby v. Derwinski, 1 Vet.App. 

225, 227 (1991) (holding that the presumption of soundness had been rebutted when there was 

clear and unmistakable evidence that the appellant entered service with a preexisting ulcer); see 

also VA Gen. Coun. Prec. 3-2003 (July 16, 2003).

While the Federal Circuit's interpretation of the presumption of soundness statute in 

Wagner sets forth what the statute has always meant, it was not the interpretation or understanding 

of the statute before its issuance. See Rivers, 511 U.S. at 312-13; Harper, 509 U.S. at 97; Russell, 

3 Vet.App. at 315. VA issued a precedential general counsel opinion in 2003 that invalidated the 

statute's initial implementing regulation, § 3.304(b). In 2004, the Federal Circuit issued its first 

judicial interpretation of the presumption of soundness statute – a new interpretation and different 

from VA's initial interpretation as expressed in § 3.304(b). Jordan, 401 F.3d at 1298 ("[T]here was 

a change in interpretation of section 1111 with the issuance of the opinion by the VA's General 

Counsel stating that 38 C.F.R. § 3.304 conflicted with the language of section 1111."). Because 
12

we find that Wagner does not apply retroactively to final decisions, we conclude that the 2016 

Board correctly stated the law as it existed in 1977.

With regard to judicial retroactivity, the parties agree that Wagner applies retroactively and 

its holding supports an allegation of CUE based on the misapplication of the presumption of 

soundness as discussed in Patrick III. See Appellant's Motion for Reconsideration at 9; Secretary's 

Response to the Appellant's Motion for Reconsideration at 6. The Court, however, disagrees. See 

Copeland, 26 Vet.App. at 90 n.4. Mr. George's argument is that if the Federal Circuit's 

interpretation of section 1111 in Wagner—that clear and unmistakable evidence is required to 

rebut both prongs of the presumption of sound condition—is what the law "'has meant since the 

date of enactment,'" Patrick VI, 668 F.3d at 1329 (quoting Patrick III, 242 F. App'x at 698), then 

the Board in September 1977 was required to apply that interpretation of the law and its failure to 

do so could constitute CUE. 

As noted above, in Patrick VI, the Federal Circuit commented in a footnote that it had 

"soundly rejected [the argument that Wagner did not apply retroactively in the context of a CUE 

motion] in Patrick III." 668 F.3d at 1333 n.6. Mr. George essentially contends that, by explaining 

in the precedential Patrick VI opinion what the Federal Circuit held in the nonprecedential Patrick 

III opinion, the nonprecedential holding became precedential. Patrick VI, however, addresses 

whether EAJA fees are warranted; it does not directly address whether Wagner supports a basis 

for a CUE motion. Accordingly, we conclude that the Federal Circuit's pronouncement in Patrick 

VI—regarding the effect of Wagner on CUE motions—is dicta. See Jama v. Immigration & 

Customs Enf't, 543 U.S. 335, 352 n.12 (2005) ("Dictum settles nothing, even in the court that utters 

it."); McDaniel v. Sanchez, 452 U.S. 130, 141 (1981) ("[D]ictum unnecessary to the decision in 

[a] case . . . . [is] not controlling in this case.").

Moreover, Patrick III is not binding precedent. See FED. CIR. R. 32.1(d) ("The court may 

refer to a nonprecedential disposition in an opinion or order and may look to a nonprecedential 

disposition for guidance or persuasive reasoning, but will not give one of its own nonprecedential 

dispositions the effect of binding precedent."). In Patrick III, the Federal Circuit clearly stated that 

the interpretation of a statute is retrospective and implied that Wagner could form the basis of an 

allegation of CUE. Patrick III also explained that this Court misread the limited holding of Jordan, 

and that Jordan did not support the proposition that this Court announced, i.e., that Wagner could 

not support an allegation of CUE. Interestingly, to support the legal proposition that a court's 
13

interpretation of a statute is retrospective and explains what a statute has always meant, the Federal 

Circuit in Patrick III cited Rivers, 511 U.S. at 312, which noted that judicial decisions generally 

apply retroactively only to cases open on direct review.

The statements in Patrick III and the footnote in Patrick VI as to Wagner's retroactivity 

conflict with other precedential Federal Circuit caselaw. For example, in DAV, the Federal Circuit 

recognized that CUE is a collateral attack on a final regional office or Board decision and that 

"[t]he new interpretation of a statute can only retroactively [a]ffect decisions still open on direct 

review, not those decision[s] that are final." 234 F.3d at 698 (emphasis added) (citing Harper, 509 

U.S. at 97). The Federal Circuit affirmed VA's regulation in DAV, including the language that CUE 

"does not include the otherwise correct application of a statute or regulation where, subsequent to 

the Board decision challenged, there has been a change in the interpretation of the statute or 

regulation." 38 C.F.R. § 20.1403(e). Mr. George asserts that there was no "otherwise correct 

application" of the law in 1977 because Wagner stated what the law has always meant. At the time 

of the Board's 1977 decision, however, the law was interpreted and understood differently. Russell, 

3 Vet.App. at 312-13. In another case dismissing an appeal from this Court, the Federal Circuit 

commented that, "where the regulations in existence at the time of the original decision imposed a 

different rule, Wagner cannot be the basis for a CUE claim." Joyce v. Nicholson, 443 F.3d 845, 

848 (Fed. Cir. 2006).

Further, it would defy reason to hold, on the one hand, that VA's 2003 change in 

interpretation of § 3.304(b) cannot form the basis of a CUE challenge to the 1977 Board decision 

because the Board in 1977 applied the then-prevailing regulatory interpretation, see Jordan, 

401 F.3d at 1298, and on the other hand that a statement of statutory interpretation announced in 

2004 can form the basis of a CUE challenge to the 1977 Board decision because the statute has 

"always meant" something different than the then-prevailing interpretation, see Patrick III, 242 F. 

App'x at 698. Because the statutory interpretation of section 311 in 1977 was embodied in 

§ 3.304(b) as it then existed, there was no practical difference between the application of section 

311 and § 3.304(b) in 1977. Wagner did not exist in 1977, and therefore the proper application of 

section 311 in 1977 did not require clear and unmistakable evidence that a preexisting condition 

was not aggravated by service. See Berger v. Brown, 10 Vet.App. 166, 170 (1997) ("A new rule 

of law from a case decided in 1993 could not possibly be the basis of an adjudicative error in 

1969.").
14

It is noted that the implications from the Federal Circuit's nonprecedential Patrick opinions 

and the Patrick VI EAJA opinion raise significant issues from the perspective of this specialized 

Court with regard to the review of CUE motions. See Shinseki v. Sanders, 556 U.S. 396, 412 (2009) 

(noting this Court's special expertise and quoting United States v. Haggar Apparel Co., 526 U.S. 

380 (1999), for the proposition that an "Article I court's special 'expertise . . . guides it in making 

complex determinations in a specialized area of the law'"). The impact of allowing judicial 

decisions interpreting statutory provisions issued after final VA decisions to support allegations of 

CUE would cause a tremendous hardship on an already overburdened VA system of administering 

veterans benefits. Each judicial interpretation of a statute which changes a previously accepted 

meaning of the statute could spawn hundreds of allegations of CUE in prior final decisions. As a 

result of a deluge of CUE motions, VA's limited resources would be diverted from processing 

claims and hearing appeals to evaluating allegations of CUE based on new statutory 

interpretations. See Exxon Corp. v. U.S. Dep't of Energy, 744 F.2d 98, 114 (Fed. Cir. 1984) 

(considering the "substantial and impossible burdens on the administration of justice" when 

deciding whether a rule should be retroactive); Cook, 318 F.3d at 1336 (noting that the "[p]rinciples 

of finality and res judicata apply to agency decisions that have not been appealed and have become 

final").

Here, Mr. George's appeal of the denial of benefits for schizophrenia was not open for 

direct review when Wagner was decided. In 1977, Mr. George had exhausted his administrative 

remedy by appealing to the Board and this decision was final. Until 1988, veterans who received 

adverse Board decisions had virtually no recourse to the courts. See Veterans' Judicial Review Act 

(VJRA), Pub. L. No. 100-687, 102 Stat. 4105 (codified as amended at 38 U.S.C. §§ 7251-7198); 

Prinkey v. Shinseki, 735 F.3d 1375, 1382 (Fed. Cir. 2013) ("[B]efore the enactment of [the VJRA] 

in 1988, there was virtually no judicial review of decisions by the VA."). Because Mr. George's 

case was not open for direct review, the judicial interpretation in Wagner does not apply 

retroactively. See Harper, 509 U.S. at 97; Beam, 501 U.S. at 535. Therefore, Wagner's

interpretation of the presumption of soundness statute issued in 2004 did not change how the law 

was interpreted or understood when the Board issued its final decision in September 1977.

Thus, to the extent that Mr. George's CUE motion includes an argument that, in 1977, there 

was not clear and unmistakable evidence to show that his condition preexisted service, the 2016 

Board noted that the evidence before the 1977 Board included evidence that Mr. George began to 
15

hear voices in April 1975 and that he experienced psychiatric symptoms en route to Utah to join 

the military in May 1975. R. at 10-11; see R. at 1244, 1282. The Medical Board and the Physical 

Evaluation Board both concluded that Mr. George's mental condition preexisted service. R. at 11. 

Although the 2016 Board noted that the record contained conflicting statements as to when Mr. 

George stated that his psychiatric symptoms began, it stressed that the September 1977 Board 

considered and weighed the evidence of record. R. at 11. As the 2016 Board concluded, "any 

disagreement with how the [1977] Board evaluated the evidence []and how it concluded from the 

evidence that the [v]eteran's claimed psychiatric disability pre[]existed service . . . is inadequate to 

rise to the level of CUE." R. at 11; see Waltzer v. Nicholson, 447 F.3d 1378, 1380 (Fed. Cir. 2006) 

(explaining that a challenge to the legal sufficiency of the evidence requires an argument of no 

evidence to rebut the presumption of soundness or the kind or character of the evidence is

insufficient as a matter of law, otherwise, the challenge is to the weight or sufficiency of fact 

required to rebut the presumption of soundness); Kent v. Principi, 389 F.3d 1380, 1383 (Fed. Cir. 

2004) ("The clear and unmistakable evidentiary standard . . . does not require the absence of 

conflicting evidence."); 38 C.F.R. § 20.1403(d)(3). Accordingly, Mr. George has not demonstrated 

that the 2016 Board's decision that the 1977 Board decision does not contain CUE is arbitrary, 

capricious, an abuse of discretion, or otherwise not in accordance with the law. Pierce v. Principi, 

240 F.3d 1348, 1356 (Fed. Cir. 2001) (holding that the party challenging a final decision bears the 

burden of proving CUE); Berger, 10 Vet.App. at 169 ("[T]he appellant, who always bears the 

burden of persuasion on appeals to this Court, bears an extra-heavy burden when the appeal is a 

collateral attack, in the form of a CUE [motion], concerning a final decision. A final decision is 

entitled to a strong presumption of validity."); Russell, 3 Vet.App. at 315.

IV. MANIFESTLY CHANGED OUTCOME

Alternatively, assuming that Wagner applies retroactively and can support allegations of 

CUE in final VA decisions, the 2016 Board did in fact assess Mr. George's CUE allegation as to 

both preexistence and aggravation and Mr. George fails to establish that the 2016 Board erred in 

concluding that the 1977 Board's errors as to each prong would not have manifestly changed the 

outcome of its 1977 decision. The 2016 Board conceded that the 1977 Board did not discuss the 

relevant statute or regulation or explain how there was clear and unmistakable evidence of a 
16

preexisting condition or no aggravation of this condition.5 R. at 10. Mr. George, however, must 

demonstrate that these errors, based on the evidence extant in 1977, would have manifestly 

changed the outcome of the 1977 Board's decision to deny benefits for schizophrenia.

Based on the 1977 record, Mr. George suggests that the Secretary could not have satisfied 

his evidentiary burden to rebut the presumption of soundness with clear and unmistakable evidence

of preexistence and lack of aggravation of his schizophrenia. The 2016 Board noted, however, that 

there was conflicting evidence of both preexistence and aggravation, yet Mr. George does not 

allege that this evidence was, as a matter of law, insufficient to establish either preexistence or no 

aggravation of schizophrenia. See Waltzer, 447 F.3d at 1380; Kent, 389 F.3d at 1383. In that regard, 

Mr. George does not in any of his pleadings include analyses or arguments as to specific evidence 

in 1977. Our dissenting colleague makes these findings herself, even though Mr. George's 

pleadings are entirely silent in this regard. See post at 20-22. We decline to find facts to assist a 

represented appellant in addressing arguments he has, presumably strategically, chosen not to 

raise. See Robinson v. Peake, 21 Vet.App. 545, 554 (2008) (presuming that "an experienced 

attorney in veteran's law[ ] says what he means and means what he says"), aff'd sub nom. Robinson 

v. Shinseki, 557 F.3d 1355 (Fed. Cir. 2009).

Here, we conclude that Mr. George has failed to carry his burden of demonstrating that the 

2016 Board erred in concluding that the 1977 Board's failure to cite the relevant statutory and 

regulatory provisions and to explain how the evidence of record rebutted both prongs of the 

presumption of soundness was not outcome determinative. Without evidence of a manifestly 

changed outcome, he has not demonstrated that the 2016 Board's finding of no CUE in the 1977 

Board decision is arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with 

the law. Pierce, 240 F.3d at 1356; Russell, 3 Vet.App. at 315. Although the Court may have 

reached a different conclusion than the 1977 Board based on the evidence in the record, this fact 

does not establish CUE in the 1977 Board decision or error in the 2016 Board decision finding no 

CUE in the 1977 Board decision. King v. Shinseki, 26 Vet.App. 433, 442 (2014) ("[T]here will be 

 

5As noted in Gilbert v. Derwinski, prior to enactment of the Veterans Judicial Review Act, the Board was 

not required to provide reasons or bases for its decisions. 1 Vet.App. 49, 56 (1990) ("Prior to the enactment of the 

VJRA, the decisions of the Board were required only to be in 'writing and . . . contain the findings of fact and 

conclusions of law separately stated.' 38 U.S.C. § 4004(d) (1982). Congress amended 38 U.S.C. § 4004(d), effective 

as of January 1, 1989, to mandate that a 'decision of the Board shall include . . . a written statement of the Board's 

findings and conclusions, and the reasons or bases for those findings and conclusions, on all material issues of fact 

and law presented on the record.' 38 U.S.C. § 4004(d)(1) (1988) (emphasis added).").
17

times when the Court arrives at a different conclusion when reviewing a motion to revise a prior, 

final decision than it would have had the matter been reviewed under the standards applicable on 

direct appeal.").

V. CONCLUSION

For the reasons stated above, the Court AFFIRMS the March 1, 2016, Board decision 

finding no CUE in the September 1977 Board decision.

BARTLEY, Judge, dissenting: I respectfully disagree with the majority in two critical respects. 

First, I believe that my colleagues fundamentally mischaracterize Wagner v. Principi, 370 F.3d 

1089 (Fed. Cir. 2004), particularly in light of Patrick v. Nicholson, 242 F. App'x 695 (Fed. Cir. 

2007) (Patrick III) and Patrick v. Shinseki, 668 F.3d 1325 (Fed. Cir. 2011) (Patrick VI), leading 

them to incorrectly conclude that Wagner contained a new understanding or interpretation of 38 

U.S.C. § 1111 (née 311) not in effect in September 1977. Second, I believe that the Board's March 

2016 conclusion that there was no CUE in the September 1977 decision was arbitrary, capricious, 

an abuse of discretion, or otherwise not in accordance with law because, had the Board properly 

applied the statutory presumption of soundness in September 1977 and not analyzed Mr. George's 

claim as one for service connection based on aggravation of a preexisting mental disorder, it would 

have had no choice but to grant him service connection. Accordingly, I must dissent from the 

majority's decision to affirm the March 2016 Board decision currently on appeal.

Regarding the first matter, I disagree with the majority's characterization of Wagner and 

its effect on the state of the law regarding the presumption of soundness. Although my colleagues 

insist that their decision relates only to the issue of the finality of the September 1977 decision, 

their finality analysis is grounded in an implicit assumption that Wagner contained a new 

understanding or interpretation of section 1111. But Wagner did not, as my colleagues suggest, 

contain a new understanding or interpretation of section 1111 that would need to be applied 

retroactively in order for Mr. George to prevail on his CUE motion. Rather, the Federal Circuit's 

judicial construction of section 1111 in Wagner provided "an authoritative statement of what the 

statute meant before as well as after the decision of the case giving rise to that construction." Rivers 

v. Roadway Express, Inc., 511 U.S. 298, 312-13 (1994); see also Schwartz v. State, 361 P.3d 1161, 

1180 (Haw. 2015) (explaining that when a court "announces a legal principle grounded in its 
18

understanding of a particular statute, it merely expresses in definitive terms what that statute has 

always meant, both before and after that decision is handed down"). Although the Federal Circuit's 

statement of the law differed from VA's pre-2003 interpretation of section 1111 set forth in 

38 C.F.R. § 3.304(b), Wagner's implicit rejection of that interpretation did not constitute a change 

in law. See State v. Ruiz, 164 A.3d 837, 844 (Conn. App. Ct. 2017) ("A decision that corrects a 

mistaken interpretation of the law does not constitute a change in the law."). Instead, 

Wagner recognized that VA had "misinterpreted the will of the enacting Congress" and reaffirmed 

"what the statute has meant continuously since the date when it became law." Rivers, at 313 n.12; 

see United States v. Peppers, 899 F.3d 211, 230 (3d Cir. 2018). 

Because "judicial decisions operate retrospectively" in this manner, United States v. 

Security Indus. Bank, 459 U.S. 70, 79 (1982), Wagner's statement of what section 1111 has 

always meant cannot, as the majority concludes, only apply prospectively to cases decided after 

Wagner was issued in June 2004. Quite the contrary: the only way to give proper effect to 

Rivers and its progeny is to accept that Wagner merely explicated the law governing the 

presumption of soundness since the enactment of section 311, including the law extant in 

September 1977 when the challenged Board decision was issued. See United States v. City of 

Tacoma, Wash., 332 F.3d 574, 580 (9th Cir. 2003) ("The theory of a judicial interpretation of a 

statute is that the interpretation gives the meaning of the statute from its inception, and does not 

merely give an interpretation to be used from the date of the decision."). 

This view of the law is the most concordant with constitutional separation of powers. As 

the Federal Circuit declared in Wagner, the language of section 1111, though complicated, has 

always been "clear on its face" and thus "susceptible of interpretation without resort to Chevron 

deference." 370 F.3d at 1093. In holding that the plain language of section 1111 mandated that 

"the government must show clear and unmistakable evidence of both a preexisting condition and 

a lack of in-service aggravation to overcome the presumption of soundness for wartime service," 

the Federal Circuit decreed that "it [was] clear that Congress intended . . . to effectively convert 

aggravation claims into ones for service connection when the government fails to overcome the 

presumption of soundness under section 1111." Id. at 1096. In effect, the Federal Circuit ruled 

that Congress left no room to debate the meaning and mechanics of section 1111, meaning that, to 

the extent that the principles set forth in Wagner conflicted with VA's interpretations of section 

311 and pre-2003 1111, the will of Congress, not VA, should prevail. See Chevron, U.S.A., Inc. 
19

v. Nat. Res. Def. Council, Inc., 467 U.S. 837, 842-43 (1984) ("If the intent of Congress is clear, 

that is the end of the matter; for the court, as well as the agency, must give effect to the 

unambiguously expressed intent of Congress.").

This is precisely the result that the Federal Circuit prescribed in Patrick III and VI. As my 

colleagues recognize, ante at 8, the Federal Circuit in Patrick III expressly held that an allegation 

that the Board misapplied section 1111 "can serve as the basis for grounding a CUE claim" 

because, "[u]nlike changes in regulations and statutes, which are prospective, our interpretation of 

a statute is retrospective in that it explains what the statute has meant since the date of enactment." 

242 F. App'x at 697 (citing Rivers, 511 U.S. at 312-13). Contrary to the majority's holding in this 

case, the Federal Circuit concluded that "our interpretation of [section] 1111 in Wagner did not 

change the law but explained what [section] 1111 has always meant" and vacated the decision and 

remanded the matter for the Court to consider the CUE motion in light of Wagner. Id. Then, when 

the case returned to the Federal Circuit for an EAJA dispute in Patrick VI, the Federal Circuit 

reiterated that it had "soundly rejected" the argument "that this court's interpretation of section 

1111 did not apply retroactively in the context of a CUE claim." 668 F.3d 1325, 1333 n.6 (Fed. 

Cir. 2011). Unlike my colleagues, I am not willing to dismiss this unambiguous and germane 

guidance from our reviewing court, particularly not when that guidance is grounded in the 

unalterable principle that veteran-friendly congressional intent holds primacy over a VA 

interpretation that is less beneficial to veterans. See Brown v. Gardner, 513 U.S. 115, 118-22 

(1994) (recognizing "the rule that interpretive doubt is to be resolved in the veteran's favor" and 

declining to defer to VA's regulatory interpretation of a statute that "flies against the plain language 

of the statutory text").

Moreover, I do not share the majority's concern that deciding this case in accordance with 

Patrick III and VI would "cause a tremendous hardship on an already burdened VA system of 

administering veterans benefits." Ante at 14. The circumstances of Wagner and this case are 

relatively narrow—both cases involve application of a plain language judicial interpretation of a 

statute to a claim that was denied on the basis of a VA regulation that clearly conflicted with that 

statute. But even if the Rivers's theory of judicial construction would apply more broadly in the 

veterans' benefits CUE context, I have no reservations about requiring VA to remedy decades-old 

errors that prohibit otherwise deserving veterans and their dependents from receiving the benefits 
20

to which they are statutorily entitled. I simply cannot endorse a CUE regimen that is so willing to

exchange justice for administrative efficiency.6

Turning to the merits of the CUE motion, I am convinced, unlike my colleagues, that the 

Board's March 2016 finding that the September 1977 Board decision was not the product of CUE 

was arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law. Each 

of the three CUE requirements is met in this case. First, consistent with Rivers, Wagner, and 

Patrick III and VI, the Board misapplied the law extant in 1977 because it did not afford Mr. 

George the presumption of soundness even though it failed to find a lack of in-service aggravation 

of schizophrenia by clear and unmistakable evidence. See Wagner, 370 F.3d at 1096 (explaining 

that the presumption of soundness applies, "even when there [i]s evidence of a preexisting 

condition, if the government fail[s] to show by clear and unmistakable evidence that a veteran's 

preexisting condition was not aggravated [in service]"). To the contrary, the Board appears to 

have applied the law regarding a claim for aggravation under 38 U.S.C. § 353, which places the 

burden to prove aggravation on the veteran, as opposed to section 311, which shifts the burden to 

the Secretary to show no aggravation by clear and unmistakable evidence. R. at 1176 (faulting the 

veteran for "fail[ing] to provide the Administration with the further information requested in order 

that further consideration may be given to the veteran's claim for aggravation" and concluding that 

his "preexisting schizophrenia was not aggravated by his military service" (citing 38 U.S.C. 

§ 353)). 

Second, that error is undebatable: The Board found that the veteran's "induction 

examination reveals no psychiatric abnormality," triggering section 311, but the Board erroneously 

analyzed the claim under section 353, with its attendant burdens, without rebutting the aggravation 

prong of the presumption of soundness by clear and unmistakable evidence. This is an unequivocal 

violation of the law: 

When no preexisting condition is noted upon entry into service, the veteran is 

presumed to have been sound upon entry. The burden then falls on the government 

to rebut the presumption of soundness by clear and unmistakable evidence that the 

 

6 Even assuming that Wagner announced a new rule of law and raised a retroactivity issue, there is good 

reason to distinguish this case from the Supreme Court's other cases outlined by the majority, which recognize that 

new rules of law do not apply retroactively to civil cases that are final. The animating principle in those cases was 

giving due respect to the finality of judicial decisions. But, unlike the average civil case where there are only very 

limited exceptions for collateral attack, Congress has bestowed on veterans' benefits claimants a statutory right to 

attack a final decision based on CUE. It is against this unusual backdrop, not that underlying the average civil case, 

that we should review this question.
21

veteran's disability was both preexisting and not aggravated by service. . . . [I]f the 

government fails to rebut the presumption of soundness under section 1111, the 

veteran's claim is one for service connection.

Wagner, 370 F.3d at 1096.

Finally, the Board's error was outcome-determinative because, had the Board properly 

applied the presumption of soundness, it would have granted service connection for 

schizophrenia.7 The Board expressly found that the first element of service connection was 

satisfied. R. at 1176 (concluding that "examinations subsequent to the veteran's discharge reveal 

that he has schizophrenia"). 

The second element of service connection would have been met if the proper presumption 

of soundness analysis was conducted because the record in 1977 did not contain clear and 

unmistakable evidence that schizophrenia was not aggravated in service—thereby establishing that 

schizophrenia was incurred in service despite evidence that it preexisted service. See Wagner, 

370 F.3d at 1094 (adopting the Government's position that, when VA fails to rebut the presumption 

of soundness, "whether and to what extent the veteran was entitled to compensation for the injury 

would be determined upon the assumption that the injury was incurred during service"); Horn v. 

Shinseki, 25 Vet.App. 231, 236 (2012) (holding that, "except for conditions noted at induction, the 

presumption of soundness ordinarily operates to satisfy the second [service-connection] 

requirement without further proof"). Evidence need not be uncontroverted to be clear and 

unmistakable, see Kent v. Principi, 389 F.3d 1380, 1383 (Fed. Cir. 2004), and I recognize that the 

record before the Board in September 1977 contained conflicting evidence as to whether 

schizophrenia was aggravated in service. Compare R. at 1280-84 (Aug. 1975 Medical Evaluation 

Board (MEB) finding of aggravation), with R. at 1294 (Aug. 1975 Physical Evaluation Board 

(PEB) finding of no aggravation). But because the record evidence of a lack of aggravation in this 

case is legally insufficient to constitute clear and unmistakable evidence to rebut the second prong 

of the presumption of soundness, schizophrenia must be presumed to have been incurred in service. 

See Kinnaman v. Principi, 4 Vet.App. 20, 27-28 (1993) (noting that the burden of proof to rebut 

 

7 My colleagues accuse me of improperly finding facts on behalf of Mr. George. Ante at 16. However, I am 

finding facts only to the extent necessary to determine whether the error committed by the Board in finding no CUE 

in the September 1977 decision was prejudicial. See Simmons v. Wilkie, 30 Vet.App. 267, 283-84 (2018) (explaining 

that, once the Court finds error in the Board's determination that there was no CUE in a prior final rating or Board 

decision, the Court may examine the facts underlying the prior decision and find any facts necessary to determine 

whether the Board's error was harmless).
22

the prongs of the presumption of soundness is "formidable" and concluding that evidence 

supporting the Board's finding of preexistence that was not "absolutely certain" did not rise to the 

level of clear and unmistakable evidence in light of a contrary PEB report). Thus, in the absence 

of clear and unmistakable evidence of a lack of aggravation, schizophrenia must be presumed to 

have been incurred in service.

Finally, the third element of service connection is satisfied via application of 38 C.F.R. 

§ 3.303(b) (1977). In September 1977, that regulation provided that "[w]ith chronic disease shown 

as such in service (or within the presumptive period under [38 C.F.R.] § 3.307) so as to permit a 

finding of service connection, subsequent manifestations of the same chronic disease at any later 

date, however remote, are service connected, unless clearly attributable to intercurrent causes." 

38 C.F.R. § 3.303(b) (1977). As the Federal Circuit explained in Walker v. Shinseki, pursuant to 

§ 3.303(b)

[i]f a veteran can prove a chronic disease "shown in service," and there are no 

intercurrent causes, the manifestation of the chronic disease present at the time the 

veteran seeks benefits establishes service connection for the chronic disease. By 

treating all subsequent manifestations as service connected, the veteran is relieved 

of the requirement to show a causal relationship between the condition in service 

and the condition for which disability compensation is sought. In short, there is no 

"nexus" requirement for compensation for a chronic disease which was shown in 

service, so long as there is an absence of intercurrent causes to explain post-service 

manifestations of the chronic disease.

708 F.3d 1331, 1335-36 (Fed. Cir. 2013) (quoting 38 C.F.R. § 3.303(b)); see Groves v. Peake, 

524 F.3d 1306, 1309 (Fed. Cir. 2008) ("The plain language of § 3.303(b) establishes a presumption 

of service connection (rebuttable only by 'clearly attributable intercurrent causes') for a chronic 

disease which manifests during service and then again 'at any later date, however remote.'" 

(quoting 38 C.F.R. § 3.303(b)).

In its September 1977 decision, the Board specifically found that Mr. George was 

diagnosed with schizophrenia in service, R. at 1172 (citing R. at 1280, 1282 (Aug. 1975 MEB 

diagnoses of paranoid schizophrenia); 1294 (Aug. 1975 PEB diagnosis of the same)), and was later 

diagnosed with chronic schizophrenia within the 1-year presumptive period following service, R. 

at 1173 (citing a March 1976 VA examiner's "diagnosis of chronic undifferentiated schizophrenic 

reaction"); see R. at 1244 (May 1976 RO decision denying service connection for "Schizophrenic 

Reaction, Chronic Undifferentiated Type"). Because these Board findings are favorable to the 

veteran and reflect that he was diagnosed with a mental disorder in service that was shown to be 
23

chronic within the relevant presumptive period, and the record in September 1977 did not contain 

evidence that attributed his then-current schizophrenia to an intercurrent cause, § 3.303(b) should 

have been applied and the linkage element of service connection should have been presumptively 

established, without the need to present any independent evidence of linkage. See 38 C.F.R. 

§ 3.309(a) (1977) (classifying psychoses as chronic diseases).8 

This is precisely the situation that the Federal Circuit addressed in Groves, where it 

reversed a Court decision affirming a Board decision that found no CUE in a prior RO decision 

that failed to apply § 3.303(b) to a claim for service connection for schizophrenia. Mr. Groves, 

like Mr. George, was diagnosed with paranoid schizophrenia during service, was medically 

discharged for that condition, and was again diagnosed with paranoid schizophrenia "shortly after 

discharge." Groves, 524 F.3d at 1310. The Federal Circuit in Groves held that this Court 

"committed legal error by disregarding the applicability of § 3.303(b) and requiring medical 

evidence to establish a nexus between the two diagnoses," and concluded that proper application 

of § 3.303(b) to the diagnoses in the record established CUE in the prior RO decision "as a matter 

of law" because Mr. Groves was entitled to presumptive service connection. Id. I see no principled 

basis upon which to distinguish Groves from the instant case, meaning that correction of the 

alleged error in this case would have unquestionably resulted in a manifestly different outcome for 

Mr. George.

Again, it is important to keep in mind the error that Mr. George is seeking to remedy. The 

language of section 311 in September 1977 was the same language in section 1111 in June 2004 

that the Federal Circuit in Wagner described as "clear" and susceptible of only one interpretation. 

370 F.3d at 1093. The only reason that Mr. George was deprived of the benefit of the presumption 

of soundness clearly envisioned and expressed by Congress was that a VA regulation, which was 

"inconsistent with the statute" and "impose[d] a requirement not authorized by [the statute]," 

dictated a different result. VA Gen. Coun. Prec. 3-2003 (July 16, 2003). Because, under Rivers 

and Patrick III and VI, the version of section 311 extant in September 1977 meant what the Federal 

Circuit in Wagner said that Congress clearly intended it meant, VA's failure to abide by that 

statutory command constituted an undebatable and outcome-determinative misapplication of the 

law. Because CUE was designed to remedy precisely this type of error, see Joyce v. Nicholson, 

 

8 Both this Court and the Federal Circuit have held that schizophrenia is a psychosis within the meaning of 

§ 3.309(a). See Groves, 524 F.3d at 1309-10; Ford v. Gober, 10 Vet.App. 531, 535 (1997).
24

19 Vet.App. 36, 48 (2005); Russell v. Principi, 3 Vet.App. 310, 313-14 (1992) (en banc), I cannot 

agree with my colleagues that, before the Wagner decision in 2004, VA's failure to rebut the 

statutory presumption of soundness by a showing of clear and unmistakable evidence that a 

condition both preexisted service and was not aggravated by service could not constitute CUE. 

Applying that analysis to this case, I would conclude that the Board in March 2016 committed 

reversible error in finding no CUE in the September 1977 Board decision that denied service 

connection for schizophrenia. Accordingly, I respectfully dissent.