N O T FO R PUB L ICAT IO N UNITED STATES C OUR T OF APPEALS FOR THE NINTH C IR C UIT
AR I NAVALO, Pe titione r,
v. C OC HISE C ONSULTANC Y, INC . a nd AC E AM E R IC AN INSUR ANC E C O. a

nd DIR EC TOR , OFFIC E OF W OR KER S’ C OM PENSATION PR OGR AM S, UNITED STATES DEPAR TM ENT OF LAB OR , R

e sponde n t s. No. 14-73181 B R B No. 14-0095 M EM O R ANDUM *

On Pe tition for R e vie w of a n Orde r of the B e ne fits R e vie w B oa

rd Argue d a nd Subm itte d Oc tobe r 21, 2016 Sa n Fra n c isc o , C a lifornia B e fore : KLEINFELD a

nd M
. SM ITH, C irc uit Judge s, a nd KOR M AN, ** Distric t Judge
. 

# FIL ED
DEC 01 2016 M OLLY C. DW Y ER, CLERK U

. S. CO URT O F APPEALS

* This disposition is not a ppropria te for public a t ion a

nd is not pre c e de nt e xc e pt a s provide d

by 9th C ir. R . 36-3. ** The Honora

ble Edwa rd R . Korm a n, Se n i or Distric t Judge for the U.S. Distric t C ourt for the Ea s te rn Distric t of Ne w York, sitting by de signa tion.Pe titione r Ari Na v a lo wa s injure d while wor k i n g for R e sponde nt C oc hise

C onsulta nc y under a c ontra c t c ove re d by the Longshore A c t (la te r re fe re nc e s to Co ch i s e inc l u de its insura nc e c a rrie r, R e sponde nt Ac e Am e ric a n Insura n c e ). An Adm inistra

tive L a w Judge a warde d Na va lo c om pe nsation unde r the Ac t. For e a c h pe riod of disa

bility , the ALJ found Na va lo’ s a ve ra ge we e k l y wa ge , a nd the n sta te d that Na v a lo wa s e ntitle d to two-thirds of t h e d i f f ere nc e be twe e n that wa ge a nd his stipula te d pre -disa

bility w a ge . Although, for two pe riods o f disa bility , that c a lc ulation would output a figure e x c e e ding the Longshore Ac t ’ s m a xim um c a p on c om p e nsation,
se e 33 U.S.C
. § 906(b)(1), t he ALJ did not ex p re ssly sta te that t he c a p a pplie d. The A L J al s o did n ot a ward a spe c ific a m ount o f c o m pe nsation. R a the r, it orde re d the distric t dire c tor— a De pa rtm e nt of La

bor func tiona

ry with only m iniste ria l
a uthority

— to c a lc ulat e one ba se d on the ALJ’ s findings a nd c onc lusions. The distric t dire c tor i n itia lly fa i le d t o a pply § 906(b)(1), a nd c a lc ulate d that C oc hise o we d m o re tha

n the m a xim

um a llowe d by t

he L ongshore Ac t. W he n C oc hise pa id a t the m a xim

u m ra te notwithsta

nding t ha t e rror, Na va lo c om

pla ine d to t

he distric t dire c tor, who issue d a n a m e nde d c a lc ulation that a pplie d § 9 06(b)(1). Na va lo
m a inta ine d that t

he initia l c a lc ulations we re fina l a nd binding, a nd a s ke d for a n orde r finding C oc hise i n de fa

u lt. The distric t dire c t or de nie d that re que st, a nd o n a ppe a l, the B e ne fits R e vie w B oa

rd a ffirm e d. Na va lo pe t itions for re vie w of the B R B ’ s de c ision.

2At the thre shold, Na v a lo ha s it wrong w he n h e f r am e s this c a se in te rm s of C oc hise ’ s fa ilure to tim e ly a ppe a l the ALJ’ s de c ision t o the B R B
. This c a se doe s not
c om e to us (nor did it t o t

h e B R B ) a s a n a tta c k on t he ALJ’ s n ow-fina l c om

pe nsation orde r. R a the r, we a re re vie wing the distric t dire c t or’ s re fusa l to issue a de fa ult orde r. O n c e the ALJ’ s ruling dispose s of a ll the outsta n ding le ga l i ssue s, t

he dis t r i ct dire c tor’ s role is “ pure ly m iniste ria l a nd a dm inistra tive .” C orne lius v . Dru m m ond C oal C o. , 9 B la c k Lung R e p . 1-40 (B e n. R e v. B d
. 1986). So if t he ALJ de c ide d the que stion o f § 9 06(b)(1)’ s a p plic a bility , that e n ds the c a se
— the ALJ’ s now-fina l ruling would c ontrol, a

nd inc onsiste nt a c tion by

the distric t dire c t or would be ultra v ire s . W e c a n sa fe ly sa

y that the ALJ did n ot rule § 906(b)(1) i napplic a ble
. Na va lo
ar g u es th a t the A LJ did so sub sile ntio whe n it a warde d two-thirds of his lost wa ge s without e xpre ss l y s t at i ng t ha t c om pe nsation wa s l im ite d by § 906(b)(1). B ut “ [w] e pre s um e that ALJs know the la w a nd a pply it in m a king the i r de c i sions.” Loc k w ood
v . C ommissione r of Soc ial Se c urity , 6 16 F.3d 1068, 1072 n.3 (9th C i r. 2010). The l a w is, a s the Supre m e C ourt ha s hel d , t ha t § 906(b)(1)— fixing the m a xim um
c om p en s at i on ra te

— “ a

pplie s globa lly , to a ll disa bility c l a im s.” Robe rts v . S e a-Land Se rv s., Inc

. , 132 S. C t. 1350, 1358 (2012). Prude nc e a nd co m m on s e nse c a ution
a ga inst re a d ing a

n ALJ de c ision to sa

y the opposite unle ss that is c le a rly its inte nde d
m e a ning. The A LJ ga ve no indic a tion that it wa s ruling § 906(b)(1) ina pplic a ble ; 3inde e d, it on ly re fe re nc e d the c a p a t a ll to note that Na va l o ha d a ppe a re d to a gre e to its a p plic a tion. B y c ontra st, in Hoffman v . C e le bre zze , 405 F.2d 833 (8th C ir. 1969),
on w hic h the disse nt re lie s to “ illustra te [] ” t he princ iple that fina lity m a y prote c t e v e n
c le a rly e rrone ous judgm e nts, the distric t c ourt e xpre ssly e nte re d a n orde r, from whic h
no a ppe a l w a s tak en , th at t h e pla intiff be pa id “ pa st d ue be ne fits a t six pe r c e nt inte re s t,” de spite the fa c t that the Soc ia l Se c urity Ac t did not pe rm it inte re st pa y m e n ts. Id. a t 834. W e n e e d not p a

rse the A LJ’ s o rde r furthe r, b e c a u se a n y othe r c onstruc tion
r eq u i re s us to de ny the p e tition. Obviously , if t he ALJ rule d that § 906(b)(1) doe s
a pply , the n the distric t dire c tor a nd the p a rtie s we re b ound by that finding, n ot by the d i s t r ic t dire c tor’ s initia l m ista ke n c a lc ulat ions. And if the ALJ m a de no ruling one
way or a nothe r, the distric t d i re c tor’ s own a p plic a tion of § 906(b)(1) would still ha ve be e n prope r a s a p ure ly m i n i s t er i a l a c t. C a lc ulating c om pe nsation is a le ga l de te rm i na tion a s m

uc h a s a m a the m a t i cal one . W ha t the B R B d e sc ribe s a s

“ c a lc ulating” c om

pe nsation is the

proc e s s of ide ntify i ng a

nd a p ply ing the provisions of the L ongshore Ac t that spe ll out the c ontrolling a rithm e tic
. Wha t give s t he job its
m iniste ria l c a st is t

h e fa c t t ha t the la w— a n d thus the a rithm e tic

— is ina rgua bly c le a r. In m a ny c a se s that c la

rity will ste m from the ALJ’ s e xpre ss d e te rm ination. B ut the l a w

4is no le s s c le a r he re , a nd the distric t d ire c tor’ s a pplic a tion no le ss m i niste ria l, be c a use § 906(b)(1)’ s a

pplic a b ility wa s se ttle d by the Supre m e C ourt inste a d
. PE T IT IO N DE NIE D.

5Navalo v. Coc hise Consultanc y , Inc . No. 14-73181

KLEINFELD, Se n ior C i rc uit Judge , disse nting
I would gra

nt the pe tition for re vie w be c a use onc e the c om

pe nsation orde r be c a m e fina l, the distric t

dire c tor la c k e d

the a uthority to a m e nd it. The ALJ instruc te d C oc h ise to pa

y Na va lo two-thirds of $2,114.56 pe r we e k, a n am ount gre a te r tha

n the sta tutory m a xim um . The ALJ did not sa

y tha t this a ward wa s
c a ppe d by § 906(b)(1).

The ALJ rule d tha

t “ E m ploy e r owe s C la im a

nt two-thirds of the

diffe re nc e ,”
a nd found tha

t the diffe re n c e wa s $2,114.56. She furthe r rule d tha

t “ [a ] ll
c a lc ulat ions of disa

bility pa y m e nts a re to be ba se d

on the C la i m a nt’ s stipula te d
a ve ra ge wa ge of $2,594.56.” As is a ppa re ntly c ustom a ry , she e n de d he r orde r with the l a ngua ge “ The distric t dire c tor sha l l m a ke a ll c a lc ulations ne c e ssa ry to c a rry out this orde r.”

The ALJ e rre d. She e vide ntly ove rlooke d the sta

tutory c a p, e ve n though it ha d be e n brought to he r a tte ntion a nd she ha d note d in the de sc riptive portion of he r de c ision tha

t the c la im a n t

a gre e d tha

t the m a xim

u m c om pe nsat ion ra

te wa s 

# FIL ED
DEC 01 2016 M OLLY C. DW Y ER, CLERK U

. S. CO URT O F APPEALS

1$1,047.16 pe r we e k. He r de c ision is not a m b iguous, though. The

distric t dire c tor ha d nothing to do but de

te rm ine wha t two-thirds of $2,114.56 wa s, a nd the
e m ploy e r ha d nothing to do, unde r he r orde r, but pa

y tha t a m ount, $1,409.71.

Ha d C oc hise a

ppe a le d the e rror, a n d the c a lc ulation ba se d on the ALJ’ s
e rror, doubtle ss C oc hise would ha ve pre va ile d a

nd the e rror would ha

ve be e n
c orre c te d
. 1 B ut C oc hise did not a ppe a l. Inste a d , it pa id the sta tutory m a xim um
a nd not the a m o unt orde re d. The e rror wa s brought to light only whe n Na va lo
c om pla i ne d tha

t he wa s not ge t ting the a m ount orde re d. I do not a gre e with the
m a jority vie w tha t the e rror in the award wa s “ pure ly m iniste ria l a

nd
a dm inistra

tive .” The ALJ m a de an e rror of la w . The only

m iniste ria l
a dm inistra

tive a spe c t wa s doing the

arithm e t ic to put a

dolla r am ount on the fra c tion, two-thirds of $2,114.56.
Judge s m a ke e rrors from

tim e to tim e , a

nd the y are c orre c te d by

m otions to
re c o nside r, m otions to a

m e nd, a ppe a ls, a n d othe r de vic e s . 2 Pa rtie s m a y not m ove for re lie f from

an e rrone o u s fina l judgm e nt whe n a judge ’ s e rror “ involve d a

1 33 U.S.C . § 921(a ); 20 C .F.R . § 802.205(a ).
2 Se e R e sta

te m e n t (Se c ond) of Judgm e nts § 71 c m t . e (Am . La

w Inst. 1982). 2funda

m e nta l m isc onc e ption of la w a n d the m otion wa s not m a de until a fte r the tim e for a ppe a l ha d run.” 3

Hoffm a n v. C e le bre z z e illustra te s this princ iple
. 4 The re , the distric t c ourt
e nte re d a n orde r re quiring the gove rnm e n t to pa y the pla intiff inc re a se d soc ia l
se c urity be n e fits a s we ll a s 6% inte re st on a ll pa s t due be ne fits. 5 The gove rnm e nt did not a ppe a l, but la

te r m ove d unde r Fe de ra l R ule of C ivil Proc e dure 60 to de le te the i nte re st pa

y m e nt provision from

the orde r be c a

use the Soc ia l Se c urity

Ac t did not pe rm i t inte re st pa

y m e n t s. 6 The distric t c ourt gra nte d the m otion, but the

Eighth C irc uit re ve rse d, re a soning tha t “ [i] f the Gove rnm e nt is of the vie w tha t e rror wa s
c om m itte d in a

warding inte re st in the fina l judgm e nt . . . the norm a l a nd
a ppropria te m e thod of a

tta c k is a tim e ly a ppe a l.” 7 A pa

rty c ould not invoke

R ule 60(b) to “ e xte nd[] the tim e for a ppe a l whic h ha d a lre a dy

e xpire d .” 8 The Hoffm a n

3 11 C ha rle s Ala n W right, Arthur R . M ille r, & M a ry Ka y Ka ne , Fe de ra l Pra c tic e a nd Proc e dure § 2858.1 (4th e d. 2012).
4 405 F.2d 833 (8th C ir. 1969).
5 Id. a t 834.
6 Id.
7 Id. a t 837.
8 Id. 3opinion re c ogniz e d tha t the inte re st in fina lity

re quire s c ourts to uphold e ve n
e rrone ous a

wards whe n the tim e to a

ppe a l ha s e xpire d.

In this c a se , C oc hise a lso c ould not c orre c t this e rror by de fy ing a judic ia l orde r. 9 Nor did the distric t dire c tor ha ve a uthority to c orre c t the ALJ’ s e rror, be c a use only the B e ne fits R e vie w B oa rd is a uthoriz e d to fix le g a l e rrors. 1 0 This rule is sim ila

r to tra ditiona l c ivil litiga

tion whe re a judge only , a nd not a c le rk, ha s the a uthority to a m e nd a judgm e nt or gra

nt re lie f from

an e rrone ous judgm e nt. 1 1

The fina lity

of a judgm e nt is e spe c i a lly

im porta nt in a disa bility c a se , be c a use a pa rty m a y pla n for the future (re nt a

n a pa rtm e nt, e t c .) ba s e d on a

n
e xpe c te d inc om e stre a m . Nava lo would re c e ive ne a rly $19,000 m ore pe r y e a r if the d istric t dire c t or ha d not m e ddle d ultra v i re s with the orde r. B e c a

use of the

9 Se e Za pon v. U.S. De p’ t. of Justic e , 53 F.3d 283, 285 (9th C ir. 1995).
1 0 33 U.S.C
. § 921(b)(3).
1 1 Fe d R . C i v. P. 59; 60. B oth rule s a uthoriz e “ the c ourt,” ra the r tha n the c le rk, to a lte r a

judgm e nt. Se e a lso M oro v. She ll Oil C o ., 91 F.3d 872, 876 (7th C ir. 1996) (“ R

ule 59(e ) a llows a

pa rty to dire c t the distric t c ourt’ s a tte ntion to ne wly disc ove re d m a te ria l e vide nc e or a m a nife st e rror of la w or fa c t, a

nd e na ble s the c ourt to c orre c t its own e rrors a nd thus a void unne c e ssa

ry a ppe lla t e proc e d ure s.” ). 4e xte nt of his injurie s
— he wa s shot in the

ba c k a nd hit by a

roa dside IED while working a s re a r gunne r in Ira q— he will like ly

ne ve r re a c h his pre -injury e a rning pote ntia l . Onc e an origina l c om pe nsation orde r be c om e s fina l, a disa b ility
c la im a nt m a y

put a down pa y m e nt on a house , a lloc a te m one y for future m e dic a l
e xpe nse s , or sta

rt sa ving for a c hild’ s c olle ge tuition. This re lia nc e inte re s t furthe r
c a utions a ga inst e x c using a

n e m ploy e r’ s fa ilure to c om

ply with or tim e ly

a ppe a l the A LJ’ s binding de c ision.

The distric t dire c t or e xc e e de d his sta tutory a u thority by a m e nding the
c om pe nsa tion orde r, a nd Na

va lo should not be

punishe d for re ly ing on the ALJ’ s de c ision onc e it be c a m e fina l.

I re spe c tfully

disse nt.

5