In the

United States Court of Appeals

For the Seventh Circuit ____________

Nos. 06-3455 & 06-3763

WEYERHAEUSER COMPANY,

Petitioner and Intervening Respondent,

v.

UNITED STATES RAILROAD RETIREMENT BOARD,

Respondent,

and

B.B., K.N., G.S., et al.,

Intervening Respondents and Petitioners.

____________

Petitions for Review of an Order

of the United States Railroad Retirement Board.

No. 06-26 (June 22, 2006)

____________

ARGUED JUNE 1, 2007—DECIDED SEPTEMBER 24, 2007

____________

Before FLAUM, MANION, and ROVNER, Circuit Judges.

MANION, Circuit Judge. Under the Railroad Retirement

Act (“RRA”), an employee who works for a railroad

employer is entitled to benefits based, in part, on the

employee’s years of service with that employer. The

intervening respondents received their paychecks from
2 Nos. 06-3455 & 06-3763

Weyerhaeuser Company (“Weyerhaeuser), but they

worked for DeQueen and Eastern Railroad (“DeQueen”),

which is a subsidiary of Weyerhaeuser. Railroad carriers

such as DeQueen are covered employers under the RRA.

Weyerhaueser did not credit these employees for that

railroad service. The Railroad Retirement Board (“Board”)

found in favor of four of the employees and credited them

for their prior service. Weyerhaeuser does not dispute that

four of the intervening respondents should be credited

retroactively for four years’ service. The Board, however,

determined that the four employees were entitled to

retroactive RRA service credit beyond the four years

automatically allowed by statute. The Board also concluded that the other two intervening respondents were not

entitled to retroactive RRA service credit. Weyerhaeuser

appeals from the Board’s order granting the four employees retroactive service credit beyond four years. The four

employees granted retroactive service credit intervened

and appeal, claiming they were entitled to additional years

of service credit, even beyond the years awarded. The two

employees denied retroactive service credit also intervened, claiming they were also entitled to retroactive

service credit. We affirm in part, reverse in part, and

remand in part.

I.

This case involves the Railroad Retirement Act of 1974,

45 U.S.C. § 231 et. seq. (“RRA”). The RRA provides “a

system of annuity, pension, and death benefits for employees of designated classes of employers,” Railroad Concrete

Crosstie Corp. v. Railroad Retirement Bd., 709 F.2d 1404, 1409

(11th Cir. 1983) (internal citation omitted), similar to the

Social Security Act. See Peppers v. Railroad Retirement Bd.,
Nos. 06-3455 & 06-3763 3

1 Available at http://www.rrb.gov/blaw/bcd/bcd03-40.htm

(last visited Aug. 1, 2007).

2 In their briefs on appeal, the six employees were all identified

solely by their initials. At oral argument, we inquired as to

why, and were informed that it is the Board’s practice so as to

maintain the privacy of the parties. The parties proffered no

other justification. However, “[j]udicial proceedings are supposed to be open, . . . in order to enable the proceedings to be

monitored by the public. The concealment of a party’s name

impedes public access to the facts of the case, which include the

parties’ identity.” Doe v. City of Chicago, 360 F.3d 667, 669 (7th

Cir. 2004). Although “the concealment of a party’s name is [not]

always improper[,] [t]he presumption [is] that parties’ identities

are public information . . . .” Id. That presumption can be

overcome “by showing that the harm to the plaintiff (normally

(continued...)

728 F.2d 404 (7th Cir. 1983) (noting that because of the

similarities between the RRA and the SSA, the same

analysis applies on appeal). The RRA applies only to

employers that provide railroad services. See 45 U.S.C.

§ 231(a) (2000) (defining the term “employer” under the

RRA).

The Board determined that the petitioner in this appeal,

Weyerhaeuser Company (“Weyerhaeuser”), is not an

employer under the RRA. See Weyerhaeuser Car Shop,

B.C.D., 03-40 (U.S. R.R. Ret. Bd. May 8, 2003) (Employer

Status Deter.).1

 However, a Weyerhaeuser subsidiary,

DeQueen and Eastern Railroad (“DeQueen”), is a covered

employer under the RRA.

The intervening respondents and petitioners, Ben

Bramlett, Karen Neumeier, Gil Sharp, Deborah Ruth, Carol

Honea and Larry Potts,2

 were all treated as Weyerhaeuser
4 Nos. 06-3455 & 06-3763

2 (...continued)

the plaintiff is the party whose identity is concealed) . . . exceeds

the likely harm from concealment.” Id. In this case, the parties

provided no justification for the use of pseudonyms, other than

that it is the Board’s practice to do so to protect the privacy of

the employees. (It is clearly not a question of protecting the

employees from retaliation, as Weyerhaeuser knows the

identity of the claimants.) A mere desire for privacy, however, does not overcome the presumption that a party’s identity

is public information. Accordingly, we identify the parties

by their names.

3 An employee is a covered employee under the RRA, if, among

other things, he is “in the service of” an RRA employer. 45

U.S.C. § 231(d)(1). An employee is “in the service of” an RRA

employer if “(A) he is subject to the continuing authority of the

employer to supervise and direct the manner of rendition of his

service, or (B) he is rendering professional or technical services

and is integrated into the staff of the employer, or (C) he is

rendering, on the property used in the employer’s operations,

personal services the rendition of which is integrated into the

employer’s operations . . . .” Id.

employees for payroll purposes, although they all performed services for DeQueen. They each received checks

from Weyerhaeuser and, in turn, Weyerhaeuser charged

DeQueen for their salaries. Weyerhaeuser did not file RRA

returns reporting compensation for Sharp, Ruth, Honea, or

Potts, and only started filing RRA returns for Bramlett and

Neumeier in the mid-1980’s.

In 2002, the Board initiated an audit of Weyerhaeuser.

Following the audit, the Board concluded that certain

employees who were paid by Weyerhaeuser, but who

performed work for DeQueen, should be considered

employees of DeQueen for purposes of RRA coverage.3

Specifically, in May 2003, the Board concluded the because
Nos. 06-3455 & 06-3763 5

4 Available at http://www.rrb.gov/blaw/bcd/bcd03-40.2.htm

(last visited Aug. 1, 2007).

5 Similarly, 45 U.S.C. § 231h provides: “The Board’s record of

the compensation so returned shall be conclusive as to the

amount of compensation paid to an employee during each

period covered by the return, and the fact that the Board’s

records show that no return was made of the compensation

claimed to have been paid to an employee during a particular

period shall be taken as conclusive that no compensation was

(continued...)

Weyerhaeuser employee Potts had provided a portion of

his services to DeQueen and was “integrated” into

DeQueen’s staff and railroad operations, he was covered

by the RRA. Potts, B.C.D. 03-40.2 (U.S. R.R. Ret. Bd. May

12, 2003) (Employee Serv. Deter.).

4 The Board concluded

that Potts’ service should have been credited under the

RRA and granted him retroactive service credit for four

years, “as permitted by section 211.16.” Section 211.16 and

its statutory counterpart, 45 U.S.C. § 231h, both provide

for time limits for correcting records of compensation.

Section 211.16 provides:

The Board’s record of the compensation reported as

paid to an employee for a given period shall be conclusive as to amount, or if no compensation was reported

for such period, then as to the employee’s having

received no compensation for such period, unless the

error in the amount of compensation or the failure to

make return of the compensation is called to the

attention of the Board within four years after the date

on which the compensation was required to be reported to the Board as provided for in § 209.6 of this

chapter.

20 C.F.R. § 211.16.5

 In other words, any compensation
6 Nos. 06-3455 & 06-3763

5 (...continued)

paid to such employee during that period, unless the error in

the amount of compensation returned in the one case, or the

failure to make return of the compensation in the other case,

is called to the attention of the Board within four years after

the day on which return of the compensation was required to

be made.”

possibly due but not paid or not credited more than four

years before the Board receives notice of a deficiency is not

recoverable, i.e., the non-payment is final. Because the

filing deadline for service records for each calendar year is

the last day of February of the following year, when the

Board issued its May 2003 decision as to Potts, the service

records for the years 1998 and earlier were deemed conclusive. Accordingly, as a result of the Board’s May 2003

decision, Potts received retroactive service credit for the

years 1999 through 2002. Potts sought reconsideration of

the Board’s decision, requesting additional retroactive

service credit beyond the four-year limit based on 20 C.F.R.

§ 211.16(b). Section 211.16(b) provides: “The Board may

correct a report of compensation after the time limit set

forth in paragraph (a) of this section where the compensation was posted or not posted as the result of fraud on the

part of the employer.” Potts argued that a 1995 efficiency

study prepared for Weyerhaeuser by Anacostia & Pacific

Company, Inc. (“Anacostia”) showed that Weyerhaeuser

fraudulently failed to file RRA service records on his

behalf. In the efficiency study, Anacostia stated that

DeQueen’s “practice of contracting with [Weyerhaeuser]

for the entire mechanical work force as well as certain

accounting personnel is subject to challenge by the Railroad Retirement Board (’RRB’). In essence, the RRB position is that railroads cannot escape payment of Railroad

Retirement and Unemployment Insurance Taxes by
Nos. 06-3455 & 06-3763 7

6 Available at http://www.rrb.gov/blaw/bcd/bcd05-21.htm

(last visited Aug. 1, 2007).

7 Available at http://www.rrb.gov/blaw/bcd/bcd05-17.htm

(last visited Aug. 1, 2007).

contracting an integral railroad function to an affiliate

under common ownership.” The Board denied Potts’

request for reconsideration, finding that Potts’ allegations

of fraud were “not meritorious.” See Potts, B.C.D. 05-21

(U.S. R.R. Ret. Bd. May 17, 2005) (Employee Serv. Deter.

Recon.).6

 The Board added:

[T]he Board regards the contention that fraud was

committed as a very serious accusation and does not

find that the failure of Weyerhaeuser to report [Potts’]

service and compensation constituted fraud even

though a management study stated that certain

Weyerhaeuser Company employees worked exclusively for [DeQueen] (and another affiliated railroad).

The Board notes that the same report also stated that

the employees had “apparently performed considerable mechanical or maintenance work for

[Weyerhaeuser Company] and third parties.”

Id.

Then, in May 2005, the Board found that Sharp, Ruth,

and Honea, who were all supervised by DeQueen employees and were subject to the continuing authority of

DeQueen, were covered employees. Accordingly, the Board

found their service creditable under the RRA. See

Weyerhaeuser Car Shop, B.C.D. 05-17 at 8 (U.S. R.R. Ret.

Bd. May 4, 2005) (Employer Status/Employee Serv.

Deter.).7

 The Board further granted them retroactive service

credit “to the extent permitted by section 9 of the Railroad

Retirement Act and section 211.16 of the Board’s regula-
8 Nos. 06-3455 & 06-3763

8 Available at http://www.rrb.gov/blaw/bcd/bcd05-39.htm

(last visited Aug. 1, 2007).

9 Potts had already requested reconsideration and the Board

had denied his request for reconsideration.” See Potts, B.C.D. 05-

21. Thus, this was his second request for reconsideration.

tions.” Id. at 8-9. That amounted to retroactive service

credit for Sharp, Ruth, and Honea for the years 2001

through 2004. Sharp, Ruth, and Honea requested additional

service credit beyond four years, also relying on 20 C.F.R.

§ 211.16(b)’s fraud exception. The Board denied their

request for additional service credit, concluding that “as a

general rule the Board’s record of compensation and

service may not be corrected after four years in the absence

of fraud. A majority of the Board finds no evidence of fraud

in the record . . . .” See B.C.D. 05-39 (U.S. R.R. Ret. Bd. Aug.

5, 2005) (Retro. Employee Serv. Credit, Employer Status

Deter.).8

After the Board issued its decision denying Sharp, Ruth,

and Honea’s request for additional service credit, their

attorney, who also represented Potts, requested reconsideration of the Board’s decisions denying all four claimants

retroactive service credit beyond four years.9

 The four

again argued that Weyerhaeuser had committed fraud and

that they were entitled to RRA service credit beyond the

four years already authorized. On June 22, 2006, the Board

reversed its earlier holding as to all four employees and

granted them retroactive service credit back to

1995—beyond the four-year limit set forth in section 211.16.

See Weyerhaeuser Car Shop, B.C.D. 06-26 (U.S. R.R. Ret. Bd.

June 22, 2006) (Employer Status/Employee Serv. Deter. on
Nos. 06-3455 & 06-3763 9

10 Available at http://www.rrb.gov/blaw/bcd/bcd06-26.asp

(last visited Aug. 1, 2007).

Recon.).10 After noting its prior decisions, in which it found

no evidence that Weyerhaeuser committed fraud, the

Board cited the 1995 Anacostia report and concluded that

that report “did or should have put Weyerhaeuser on

notice of the nature of the issue regarding the reporting of

service performed by its employees for the affiliated

carriers and created reasonable expectations that such

service should be creditable under the Acts.” Id. at 3. The

Board added that “neither section 9 of the RRA nor section

211.16 of the [Board’s] regulations should be applied to

bar” the employees from receiving additional retroactive

service credit. Id. at 3-4. Accordingly, the Board ordered

that Sharp, Ruth, Honea, and Potts receive retroactive

service credit back to 1995, id. at 3, which in effect added

six years of service credit for Sharp, Ruth, and Honea and

four years for Potts. Weyerhaeuser filed a petition for

review of the June 22, 2006, decision in this court. Sharp,

Ruth, Honea, and Potts intervened in this appeal, arguing

that the Board erred in limiting the retroactive service

credit to 1995, maintaining they are entitled to retroactive

service credit for every year they worked at Weyerhaeuser.

Two other employees of Weyerhaeuser, Ben Bramlett and

Karen Neumeier, also intervened in this appeal. Bramlett

and Neumeier both were treated as employees subject to

the RRA provisions since 1984, but they claim that they

were entitled to retroactive service credit for the years from

1973 through 1984 and 1975 through 1984, respectively. In

August 2005, the Board concluded that Bramlett and

Neumeier were not entitled to retroactive service credit

because more than four years had passed and there was no
10 Nos. 06-3455 & 06-3763

evidence in the record of employer fraud in connection

with Bramlett and Neumeier. See B.C.D. 05-39.

Bramlett and Neumeier sought reconsideration of that

decision. The Board affirmed its initial determination,

concluding again that there was no evidence of fraud for

the period of 1973 through 1984. B.C.D. 06-26 at 4. In so

ruling, the Board added that Bramlett and Neumeier are

precluded from obtaining retroactive service credit “more

than twenty years after the alleged conduct” by

Weyerhaeuser. B.C.D. 06-26 at 4. Bramlett and Neumeier

seek to overturn the Board’s decision on appeal.

II.

This court has jurisdiction to review the final decisions of

the Board pursuant to 45 U.S.C. § 355. We review the

Board’s decision to determine if it is supported by substantial evidence, which is “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Richardson v. Perales, 402 U.S. 389, 401 (1971) (internal

citation omitted). Moreover, a Board decision must have a

reasonable basis in the law. Holman v. U.S. R.R. Ret. Bd., 253

F.3d 975, 978 (7th Cir. 2001).

On appeal, Weyerhaeuser first claims that the Board’s

decision to grant retroactive service credit beyond four

years to Sharp, Ruth, Honea, and Potts lacks a reasonable

basis in the law because the regulations allow for such

retroactive service credit only in the event of fraud, and the

Board concluded that there was no evidence of fraud. We

agree. As quoted above, 20 C.F.R. § 211.16 provides that the

Board’s records are conclusive unless (1) “RRA employment taxes previously had been paid and either error

correction or principles of equity require that the employee
Nos. 06-3455 & 06-3763 11

received additional retroactive service credit”; or (2) “the

employee’s erroneous service record is due to employer

fraud.” 20 C.F.R. § 211.16. The parties agree that the first

exception does not apply, thus leaving the fraud exception

as the only possible way for the intervening parties to

obtain retroactive service credit beyond four years.

In this case, though, the Board found there was no

evidence of fraud. See Potts, B.C.D. 05-21 at 3. (“[T]he

Board regards the contention that fraud was committed as

a very serious accusation and does not find that the failure

of Weyerhaeuser to report [Potts’] service and compensation constituted fraud even though a management study

stated that certain Weyerhaeuser Company employees

worked exclusively for [DeQueen] (and another affiliated

railroad).”); B.C.D. 05-39 at 1-2 (denying Sharp, Ruth, and

Honea’s request for additional years of retroactive service

credit, concluding that “as a general rule the Board’s record

of compensation and service may not be corrected after

four years in the absence of fraud. A majority of the Board

finds no evidence of fraud in the record . . . .”). Significantly, on reconsideration the Board did not find that

Weyerhaeuser had committed fraud. Rather, the Board

concluded that the 1995 Anacostia report “did or should

have put Weyerhaeuser on notice of the nature of the issue

regarding the reporting of service performed by its employees for the affiliated carriers and created reasonable

expectations that such service should be creditable under

the Acts.” See B.C.D. 06-26 at 3. The Board then added

that “neither section 9 of the RRA nor section 211.16 of the

[Board’s] regulations should be applied to bar” the employees from receiving additional retroactive service

credit. Id. at 3-4.

That, however, is exactly what section 211.16 of the

Board’s regulations does—bars employees from receiving
12 Nos. 06-3455 & 06-3763

additional retroactive service credit absent limited circumstances, such as employer fraud. Specifically, 20 C.F.R.

§ 211.16(c) provides that “[e]xcept as provided in paragraph (b)(1) of this section, no employee may be credited . . . beyond the four year period . . . unless the employee established to the satisfaction of the Board that all

employment taxes . . . have been paid with respect to the

compensation and service.” Because employment taxes

have not been paid on behalf of the six claimants, service

credit is only creditable beyond four years, as provided

in paragraph (b)(1), and that section states that “[t]he

Board may correct a report of compensation after [four

years] where the compensation was posted or not posted

as the result of fraud on the part of the employer.” 20

C.F.R. § 211.16(b)(1).

On appeal, the Board readily admits that it “did not find

that Weyerhaeuser Company committed fraud, as that

term is commonly used, in connection with Weyerhaeuser

Company’s failure to report compensation for the individuals for whom it now concedes are or were employees of the

DeQueen and Eastern Railroad.” Board’s Respondent,

Cross-Respondent Brief at 12-13. The Board attempts to

sidestep this concession in two main ways. First, it notes

that § 211.16(b)(1) does not define “fraud,” and then the

Board points out that it had previously found that the

“knowing failure to report compensation and service as

required under the Railroad Retirement Act, met the

standard set forth in section 211.16(b) and would support

the requirement of retroactive crediting of service and

compensation.” Board’s Respondent, Cross-Respondent

Brief at 11. Similarly, the intervening respondents point to

other Board decisions granting retroactive service credit

beyond four years, which were based on an employer’s

knowing failure to report compensation. Intervening

Respondents and Petitioners’ Brief at 15-16. From this, we
Nos. 06-3455 & 06-3763 13

11 Because the Board did not find that Weyerhaeuser had

knowingly failed to report compensation for the intervening

respondents and concedes that the Board did not find

Weyerhaeuser had committed fraud as that term is commonly

used, we need not decide whether a knowing failure to report compensation would qualify as “fraud” under 20 C.F.R.

§ 211.16(b)(1). Other portions of the regulations provide that

“[u]nlike fraud, fault does not require a deliberate intent to

deceive,” indicating that fraud requires a deliberate intent to

deceive. 20 C.F.R. § 255.11(b). Additionally, the consultant’s

(continued...)

understand the Board and intervening respondents to be

arguing that, since the regulations do not define “fraud,”

the Board has discretion to interpret that term to mean the

“knowing failure to report compensation.” The problem

with this argument is that the Board, in this case, did not

find that Weyerhaeuser had “knowingly failed to report

compensation.” Rather, the Board found that the Anacostia

report “did or should have put Weyerhaeuser on notice of

the nature of the issue regarding the reporting of service

performed by its employees for the affiliated carriers and

created reasonable expectations that such service should be

creditable under the Acts.” See B.C.D. 06-26 at 3. Thus,

rather than apply the “knowing” standard the Board

seemingly puts forth for fraud on appeal, the Board

applied a “did or should have had notice” standard. (And

even then, the Board did not conclude that Weyerhaeuser

knew or should have had notice that it was required to

report compensation under the RRA—it merely concluded

that the report “did or should have put Weyerhaeuser on

notice of the nature of the issue, . . . and created reasonable

expectations that such service should be creditable under

the Acts.”) Thus, the Board’s decision cannot stand even

applying its favored definition of “fraud.”11
14 Nos. 06-3455 & 06-3763

11 (...continued)

report may not prove intent or knowledge, since the report

came from an independent consultant and not the Board and

merely raised the issue with Weyerhaeuser; the report did

not conclude that the employees were definitively subject to

taxes, but rather that the practice may be “subject to challenge.”

The Board also puts forth an equitable argument for

sustaining its decision: It argues that because

“Weyerhaeuser Company knew or should have known that

the individuals should be receiving credit for service

performed for DeQueen and Eastern while they were on

the Weyerhaeuser Company payroll,” Board’s Respondent,

Cross-Respondent Brief at 13, “it is equitable that these

individuals receive credit under these circumstances.” Id.

Initially, we note that in its decision on reconsideration, the

Board never found that Weyerhaeuser “knew or should

have known that the individuals should be receiving

credit . . . .” Rather, as noted above, the Board found that

Weyerhaeuser knew or should have known “of the issue.”

Knowing that something is an issue is quite different than

knowing that you are legally required to report service

credit. Regardless, the regulations that the Board itself

promulgated do not provide an equitable exception to the

four-year bar. Rather, the only exception relevant to this

appeal is the fraud exception. Yet on reconsideration the

Board did not address the question of fraud, instead stating that it “need not make a finding as to whether

Weyerhaeuser willfully failed to report certain of its

employees under the [RRA].” B.C.D. 06-26 at 3. The Board

cannot ignore its own regulations merely because it finds

them inequitable under the circumstances of this case. See

Rhodes v. Johnson, 153 F.3d 785, 789 (7th Cir. 1998) (noting

that while an agency has discretion to reasonably interpret

its regulations, this “must not be confused with the power
Nos. 06-3455 & 06-3763 15

to rewrite” unambiguous regulations); Pearce v. Director,

Office of Workers’ Comp. Programs, 647 F.2d 716, 726 (7th Cir.

1981) (stating that “it is well settled that reasonable regulations promulgated pursuant to statutory authority have the

force and effect of law. . . . [and] an agency is bound by its

own regulations”). See also Panhandle E. Pipe Line Co. v. Fed.

Energy Regulatory Comm’n, 613 F.2d 1120, 1136 (D.C. Cir.

1979) (noting that “[t]he fact that a regulation as written

does not provide [the agency] a quick way to reach a

desired result does not authorize it to ignore the regulation

or label it ‘inappropriate’ ”). Therefore, there is no basis in

law for the Board’s decision on reconsideration that

Sharp, Ruth, Honea, and Potts are entitled to retroactive

service credit beyond four years.

Weyerhaeuser argues that upon overturning the Board’s

decision on reconsideration, there is no need for remand

because the Board had already concluded that there was no

evidence of fraud. The Board in its earlier decisions had

found that there was no evidence of fraud. See B.C.D. 05-

21; B.C.D. 05-39. But those decisions are not before this

court. Rather, the only decision before this court is the

Board’s decision on reconsideration. Although the Board’s

decision on reconsideration cannot stand because it failed

to apply the fraud standard established in its own regulations, the intervening respondents had sought reconsideration of the Board’s initial decision that there was no

evidence of fraud. The Board never addressed that question on reconsideration. See B.C.D. 06-26 at 3 (stating that

the Board “need not make a finding as to whether

Weyerhaeuser willfully failed to report certain of its

employees under the [RRA]”). Accordingly, we must

remand this case to the Board to rule on the motion for

reconsideration applying the proper standard, at least as to

intervening respondents Sharp, Ruth, and Honea. There is
16 Nos. 06-3455 & 06-3763

12 A “final determination” is defined as “[a]ny determination

rendered by the Board at the initial or reconsideration

stages.” 20 C.F.R. § 259.6.

no need to remand for intervening respondent Potts

because, as discussed below, the Board violated its own

regulations in reopening Potts’ case.

As set forth above, the Board originally concluded in

May 2003 that Potts was entitled to retroactive service

credit for the years 1999 through 2002. Potts sought reconsideration of that decision, arguing that he was entitled to

credit for additional years that he had worked for

Weyerhaeuser. The Board denied Potts’ request for reconsideration in May 2005, and Potts did not appeal that

decision. However, when the Board granted Sharp, Ruth,

and Honea’s request for reconsideration, the Board also

“reopen[ed] the decision regarding [Potts’] request for

reconsideration,” and then concluded that Potts should

receive credit back to 1995. See B.C.D. 06-26 at 4. The

regulations, though, limit the Board’s authority to reopen

decisions relating to employee status determination. The

Board’s regulations provide for the “Finality of determinations issued under this part,” stating:

Any determination rendered by the Board at the initial

or reconsideration stages shall be considered a final

determination and shall be binding with respect to all

parties unless reversed on reconsideration or upon

judicial review. A final determination may be reopened

at the request of a party who was, or could have been,

a party to the final determination when the party

alleges that the law or the facts upon which the final

determination was based . . . changed sufficiently to

warrant a contrary determination.[12]
Nos. 06-3455 & 06-3763 17

13 In making the equitable argument on appeal, the Board relies

on the fact that on reconsideration, it granted Sharp, Ruth,

and Honea retroactive service credit to 1995. That decision,

however, has no basis in law, see supra at 15, and the only

way that Sharp, Ruth, or Honea will receive additional service credit is if on remand the Board reverses its previous

factual finding that there was no fraud on the part of

Weyerhaeuser. Conversely, if the Board stands by its original

(continued...)

20 C.F.R. § 259.6. Thus, the Board only had the power to

reopen Potts’ case if “the law or the facts upon which the

final determination was based . . . changed sufficiently to

warrant a contrary determination.” Id.

On appeal, the Board does not claim that the law

changed. Rather, the Board asserts that its decision granting Sharp, Ruth, and Honea reconsideration is a “change of

facts” which justifies the Board’s reopening of its decision

as to Potts. Board’s Respondent, Cross-Respondent Brief

at 15. Section 259.6 of the regulations, however, only allows

for the reopening of a decision if there was a change in

facts “upon which the final determination was based. . . .”

Id. But in denying Potts’ request for reconsideration, the

Board did not base its decision on the fact that Sharp, Ruth,

and Honea were also denied retroactive service credit

beyond four years; rather, the Board based its decision on

the lack of evidence of fraud. Thus, none of the underlying

facts upon which the Board’s final determination as to

Potts’ request for reconsideration changed. Therefore,

section 259.6 of the regulations does not authorize the

Board to reopen Potts’ case. While the Board argues that it

would be inequitable to treat Potts differently than Sharp,

Ruth, and Honea,13 “[w]hen an administrative agency
18 Nos. 06-3455 & 06-3763

13 (...continued)

factual finding of no fraud, then there will be no disparate

treatment.

promulgates rules to govern its proceedings, these rules

must be scrupulously observed . . . for once an agency

exercises its discretion and creates the procedural rules

under which it desires to have its actions judged, it denies

itself the right to violate these rules.” Black v. Interstate

Commerce Comm’n, 737 F.2d 643, 652 n.3 (7th Cir. 1984). We

further noted in Black, “[i]f an agency in its proceedings

violates its rules and prejudice results, any action taken as

a result of the proceedings cannot stand.” Id.

The Board also attempts to justify its decision to reopen

Potts’ case by noting that the three-member Board reopened Potts’ case on its own initiative and that “the Board

has the discretion to reopen any case where the Board

deems it proper to do so.” Board’s Respondent, CrossRespondent Brief at 15. In support of its position, the Board

cites 20 C.F.R. § 261.11, entitled: “Discretion of the threemember board to reopen or not to reopen a final decision.”

Potts likewise relies on section 261.11 as a basis for reopening his case. That section provides:

In any case in which the three-member Board may

deem proper, the Board may direct that any decision,

which is otherwise subject to reopening under this

part, shall not be reopened or direct that any decision,

which is otherwise not subject to reopening under this

part, shall be reopened.

20 C.F.R. § 261.11

While section 261.11 provides the Board with discretion

to reopen cases that are not otherwise subject to reopening,
Nos. 06-3455 & 06-3763 19

14 Specifically, Section 260.1(a) provides: “Claims for benefits

shall be adjudicated and initial decisions made by the Board

concerning: (1) Applications for benefits under the Railroad

Retirement Act; (2) The withdrawal of an application; (3) A

change in an annuity beginning date; (4) The termination of an

annuity; (5) The modification of the amount of an annuity or

lump-sum benefit; (6) The reinstatement of an annuity which

had been terminated or modified; (7) The existence of an

erroneous payment; (8) The recovery of the amount of an

erroneous payment; (9) The eligibility of an individual for a

supplemental annuity or the amount of such supplemental

annuity; (10) Whether representative payment shall serve the

best interests of an annuitant as a result of that individual’s

incapacity to manage his annuity payments; and (11) Who

shall be designated or continued as representative payee on

behalf of an annuitant.” 20 C.F.R. § 206.1(a).

that language is modified by “under this part.” “This part”

is part 261. Further, 20 C.F.R. § 261.1(b) provides that “[a]

final decision as that term is used in this part means any

decision of the type listed in § 260.1 of this chapter . . . .”

Section 260.1 provides for decisions by the Board on claims

for benefits under the RRA.14 Potts, however, was not

seeking benefits under the RRA and the Board was not

reopening a final decision of the type listed in § 260.1.

Rather, the Board’s decision concerned Potts’ status as an

employee under the RRA and that decision involved part

259. See 20 C.F.R. § 259. Thus, by its own terms, 20 C.F.R.

§ 261.11 does not apply to this case.

The Board does not cite any other statutory or regulatory

provisions that would authorize it to reopen Potts’ case,

and thus has forfeited any other basis for reopening the
20 Nos. 06-3455 & 06-3763

15 In his brief, Potts also points to 20 C.F.R. § 261.2(a) and

§ 261.2(b) as possible authority for the Board’s decision reopening his case. Section 261.2 provides for conditions for reopening

“[a] final decision,” but as noted above, “final decision” for

purposes of part 260 “means any decision of the type listed in

§ 260.1.” Because Potts’ case did not involve a type listed in

§ 260.1, it was not a final decision for purposes of § 261.2 and

thus the grounds for reopening in § 261.2(a) and (b) do not

apply.

case.15 Since the only regulation applicable limits the

Board’s authority to reopen cases to circumstances not

present here, the Board acted contrary to the law in reopening Potts’ case, and that decision must be reversed. The

Board may not like its regulations, but as noted above,

“[w]hen an administrative agency promulgates rules to

govern its proceedings, these rules must be scrupulously

observed . . . for once an agency exercises its discretion

and creates the procedural rules under which it desires to

have its actions judged, it denies itself the right to violate

these rules.” Black, 737 F.2d 643 n.3.

That brings us to Sharp, Ruth, Honea, and Potts’ claim

that the Board erred in limiting retroactive credit to 1995.

While we must remand this case for the Board to apply the

required fraud standard to determine whether Sharp, Ruth

and Honea were entitled to retroactive credit to 1995,

remand is not necessary to resolve Sharp, Ruth, Honea and

Potts’ petition challenging the Board’s refusal to grant them

credit for the earlier years. We review the Board’s decision

for substantial evidence. Wassenberg v. U.S. R.Ret. Bd., 75

F.3d 294, 296 (7th Cir. 1996). Given this deferential standard, we conclude that the Board did not err in concluding

that Sharp, Ruth, Honea, and Potts were not entitled to
Nos. 06-3455 & 06-3763 21

additional years of service credit. The Anacostia Report

was not issued until 1995, and it was this report that the

Board concluded put Weyerhaeuser on notice of the issue

that it might need to treat some of its employees as employees under the RRA. While we leave for remand the question of whether this report established fraud, we conclude

that the Board’s decision that prior to that date there was

no evidence of fraud is supported by substantial evidence.

Accordingly, under these circumstances, we affirm the

Board’s decision to deny these four claimants service credit

pre-dating the report.

Finally, Bramlett and Neumeier claim that the Board

erred in denying them any retroactive credit. Both Bramlett

and Neumeier were treated as employees subject to the

RRA since 1984, but they claim they were entitled to

retroactive service credit for all of the years they worked at

Weyerhaeuser, which would date back to the early 1970’s.

The Board rejected their claim, concluding that it was the

1995 report that put Weyerhaeuser on notice of the RRA

reporting issue and that since those claimants had received

service credit since the 1980’s, they were not entitled to any

additional retroactive service credit.

Again, our review is for substantial evidence. See

Wassenberg, 75 F.3d at 296. Given this deferential standard,

we conclude that the Board did not err in concluding that

Bramlett and Neumeier were not entitled to additional

years of service credit. The Anacostia Report was not

issued until 1995, and it was this report that the Board

concluded put Weyerhaeuser on notice of the issue that it

might need to treat some of its employees as employees

under the RRA. By 1995, however, Weyerhaeuser had

already been treating Bramlett and Neumeier as employees

under the RRA. While Bramlett and Neumeier point to
22 Nos. 06-3455 & 06-3763

16 Bramlett and Neumeier, along with intervening respondents

Sharp, Ruth, Honea, and Potts, note that “[i]n the event that

this Court finds evidence of intent to mislead insufficient to

substantiate a finding of employer fraud on the current record, then on remand for a hearing, the RRB could subpoena

all individuals who have provided information in this case.”

Brief of Intervening Respondents and Petitioners at 25. They

further note that they “specifically requested evidentiary

hearing [s] on at least ten (10) occasions in the record [but] [t]hey

never were given a hearing, . . . .” Id. at 27. It is unclear from

these passing comments whether the six claimants were attempting to argue on appeal that the Board erred in denying

their request for an evidentiary hearing. Their brief did not

identify that as an issue on appeal. More significantly, the

claimants did not cite any case law addressing whether this

court has jurisdiction to review the Board’s decision not to

hold an evidentiary hearing, and, if so, the appropriate standard of review. By not presenting or developing this argument

on appeal, the claimants have waived any challenge to the

Board’s decision not to hold an evidentiary hearing. See

Weinstein v. Schwartz, 422 F.3d 476, 477 n.1 (7th Cir. 2005) (noting that failure to develop arguments on appeal constitutes

waiver).

other evidence that they believe shows that Weyerhaeuser

should have treated them as RRA employees since 1973,

the Board did not find that evidence indicative of fraud,

and it is not our place to second-guess the Board’s factual

determination. Accordingly, under these circumstances, the

Board’s decision to affirm its original decision denying

Bramlett and Neumeier additional retroactive credit is

affirmed.16
Nos. 06-3455 & 06-3763 23

III.

The Board’s regulations limit retroactive service credit

to four years, absent an exception to the general four-year

bar. The Board initially concluded as to Sharp, Ruth,

Honea, and Potts’ claims for additional service credit that

the only exception possibly applicable in this case—

employer fraud—did not apply because there was no

evidence that Weyerhaeuser had committed fraud. On

reconsideration, the Board granted retroactive service

credit beyond the four years, to 1995, without finding

that Weyerhaeuser had committed fraud. This contravened

the governing regulations and was thus contrary to law.

Accordingly, we reverse the Board’s decision on reconsideration as to Sharp, Ruth, Honea, and Potts. We further

remand this case to the Board for it to rule on Sharp, Ruth,

and Honea’s motion for reconsideration applying the

fraud standard mandated by the Board’s regulations.

Because the Board had already denied Potts’ motion for

reconsideration and violated its own regulations in reopening that decision, there is no basis for a remand for Potts.

As to Bramlett and Neumeier: the Board’s decision denying

them retroactive service credit is supported by substantial

evidence and, accordingly, we affirm that decision. We also

affirm the Board’s decision denying Sharp, Ruth, Honea

and Potts retroactive credit for years pre-dating the

1995 report, as that decision was also supported by substantial evidence.
24 Nos. 06-3455 & 06-3763

A true Copy:

Teste:

 _____________________________

Clerk of the United States Court of 

Appeals for the Seventh Circuit 

USCA-02-C-0072—9-24-07