## United States Court of Appeals for the Federal Circuit

04-7034

TIMOTHY J. JORDAN, Claimant-Appellant,

v.
R. JAMES NICHOLSON, Secretary of Veterans Affairs, Respondent-Appellee.

Helen S. Irza , Morrison & Foerster LLP, San Diego, California, argued for claimant-appellant. On the brief was Ronald L. Smith . Of counsel was Donald E. Purcell , Disabled American Veterans, of Washington, DC. Martin F. Hockey, Jr. , Senior Trial Counsel, Commercial Litigation Branch, Civil Division, United States D epartment of Justice, of Washington, DC, argued for respondent-appellee. With him on the brief were Peter D. Keisler , Assistant Attorney General and David M. Cohen , Director. Of counsel on the brief were Michael J. Timinski , Deputy Assistant General Counsel and David J. Barrans , Staff Attorney, United States Department of Veter ans Affairs, of Washington, DC. Appealed from: United States Cour t of Appeals for Veterans Claims Judge Jonathan R. Steinberg

## United States Court of Appeals for the Federal Circuit

04-7034 TIMOTHY J. JORDAN, Claimant-Appellant,

v. R. JAMES NICHOLSON, Secretary of Veterans Affairs, Respondent-Appellee.

__________________ _________ DECIDED: March 15, 2005

__________________ _________ Before NEWMAN, RADER, and BRYSON, Circuit Judges

. RADER, Circuit Judge

. The Court of Appeals for Veterans Cla ims (Veterans Court) affirmed the Board of Veterans’ Appeals’ (Board’s) dec ision, which rejected Timothy Jordan’s claim. Mr. Jordan had asserted that a 1983 Board decision denying him service connection status on a knee disorder contained clear and unmistakable error (CUE). Jordan v. Principi , No. 00-206 (Vet. App. Sep t. 24, 2003). Because the Veterans Court correctly determined that CUE does not arise from a change in the interpretation of a statut e, this court affirms.
I. Mr. Jordan served in the militar y for one month and nineteen days, from November 1969 through January 1970. Fifteen months before entering service, Mr. Jordan suffered left and right knee inju ries from a motorcycle accident. Mr.Jordan’s m edical entrance exam ination repo rt records a scar below the left knee but otherwise makes no ment ion of these injuries. Less than o ne month after service entry, Mr. Jordan complained of right knee pain, which a doctor diagn osed as chondromalacia p a tella. T he military discharged Mr. Jordan in January 1970. In August 1981, Mr. Jordan filed for se rvice connection status on his right knee injury with the VA regional office ( R O). The RO denie d this c l aim in November 1981. The RO concluded that Mr. Jordan’s right knee injury predated his servic e entry, and that his service h ad not aggravat ed that injury. Mr. Jordan then appealed the RO decision to the Bo ard. The Board affirmed the RO’s decision in April 1983 finding “clear and unmistakable evidence t hat the veteran suffered a right kneec ap trauma prior to entr ance on active servic e.” Additionally , the Board determined that “[ d]uring the veteran’s perio d of service there was no increase in the severity of his pr eexisting right k nee disorder.” In 1999, Mr. Jordan filed a CUE claim disputing t he 1983 Board decision. In November 1999, the Board ruled that there was no CUE in its 1983 decis ion. In so holding, the Board noted that “there was more than adequate evidence showing that the veteran’s right k nee disorder underwent no permanent increase in sev e rity during his period of active serv ice.” Mr. Jordan next appealed the 1999 Boar d ruling to the Court of Appeals for Veterans Claims. Mr. Jordan argued that the 1983 Board decision mis i nt erpreted provisions in 38 U. S.C. § 1111 that govern the pres umption of soundness. In particular, Mr. Jordan contended that the 19 83 Board decision did not requi re the Government to rebut

04-7034 2the presumption of soundnes s with clear and unmistakable evidence th at his disab ility was not ag gravated during service. While Mr. Jordan’s Veterans Co urt appeal was pending, the VA’s General Counse l issued an opinion stating that 38 C.F.R. § 3. 304, the VA regu lation that implements se ction 1111, conflicted with the language of section 1111. Nevertheless, in 2003, the Veterans Court affirmed the 1999 Board decis ion, fi nding no CUE because CUE “does not include the otherwis e correct application of a statute or regulation wh ere, subsequent to the Board decision chal lenged, there has been a change in the interpretation of the statute or regulat ion” under 38 C.F.R. § 20.1403(e).
II. This court has jurisdic tion to review Veterans Court decisions on issues of law under 38 U.S. C. § 7292. Szemraj v. Principi , 357 F.3d 1370, 1374-75 ( F ed. Cir. 2004) (citation omitted). This cour t reviews the asserted legal error withou t deference. Id. at 1372. On appeal, Mr. Jordan contends that 38 C.F.R. § 3.304, the VA regulation implementing section 1111, is void ab in itio . Mr. Jordan notes that the VA interpreted section 1111 contrary to its facially apparent meaning. As such, Mr. Jordan would hav e this court hold that invalidation of this regulation can retroactively affect final decis ions, unlik e a new interpretation of a regulation, which “can only retro a ctively [a]ffect dec isions still open on dir e ct review, not those decisions that are final.” Disabled Am. Veterans v. Gober , 234 F.3d 682, 698 (Fed. Cir. 2000).

04-7034 3The Gover n ment responds that this court’s decision in Gober , interpreting 38 C.F.R. § 20.1403(e), cont rols this is sue of retr oactive applic ation of an erroneous regulatory interpretation. The Government further notes that even later-invalidated statutes and regulations do not have retroacti ve effect under U.S. Supreme Court precedent. F i nally, the Government contends that even if invalidated regulations did have retroacti ve effect, the VA r egulation in question is not void ab initio because s e ction 1111 is ambi guous wh en read in lig h t of section 1153. The VA regulation in question, Section 3.304(b), provides: The veteran will be c onsidered to have been in sound condition when examined, accepted and enroll ed f o r service, except as to defects, infirmities, or disorders not ed at entrance into service, or where clear and unmistakable (obvious or manifest) evidence demonstrates that an injury or disease existed prior thereto . Only such conditions as are recor ded in examination r eports are considered as noted. (Emphasis added.) In contrast, section 1111 provides: For the purposes of section 1110 of th is title, every veteran shall be taken to have been in sound co ndition when e x amined, accept ed, and enrolled for service, exc e pt as to defects, infirmities, or disorders noted at the time of t he examination, acc eptance, and enrollment, or where clear and unmistakable evidence demonstrates that the injury or disease exis ted before acceptance and enrollment and was not aggravated by such service

. (Emphasis added.) Section 3. 304(b), when compared to section 1111, notably omits the requirement of clear and unmis takable ev idence for aggravation of an injury. This court recently held that section 1111 requires that “the Government must

04-7034 4show 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.” Wagner v. Principi , 370 F.3d 1089, 1096 (Fed. Cir. 2004). This appeal does not question again the correct legal standard under section 1111. Wagner governs that issue. Rather , this case asks whether the change in legal sta ndards in the inter p retation of the regulatio ns should retroactively affect CUE claims. Mr. Jo rdan seeks to avoid this court’s precedent in Gober , arguing that the prior, now in valid, regulation was void ab initio and therefore did not really exist at the time of his entry. Thus, Gober would not apply to this case. Although creative, Mr. Jordan’s argument finds no legal support. Mr. Jordan fails to recognize that there wa s a change in interpretation of section 1111 with the issuanc e of the opinion by the VA’s General Couns el stating that 38 C.F.R. § 3.304 c o nflicted with the language of s e ction 1111. Wagner , 370 F.3d at 1092. Mr. Jordan believes that secti on 3.304 was inacc u rate in setting forth the proper legal standar d and that it was void ab initio . Howev e r, the accuracy of the regulation as an interp retation of the governing legal standard does not negate the f a ct that the regulat ion did prov ide the first commentary on section 1111, and was t herefore the initial interpreta tion of section 1111. Hence, Gober applies to the change in interpretation of that statute as affected by the issuance of the General Couns el’s opinion. First, 38 C.F.R. § 20.1403(e) plainly st ates: “Clear and unmistakable error does not include the otherwise correct app lic ation of a stat ute or regulation

04-7034 5where, subsequent to the B oard decision cha llenged, there has been a chan ge in the interpretation of the statute or regulation.” This c ourt in Gober has affirmed that rule: “The new interpretation of a st atute can only retroactively [a]ffect decisions s t ill op en on direct review, not those decis ion s that are final.” Gober , 234 F.3d at 698. In this case, the inte rpretation of the regulat ion has in deed changed, but becaus e the 1983 Board decision was final, Mr. Jordan has no recourse for appeal through a CUE c l ai m; 38 C.F.R. § 20.1403(e) clearly proscribes Mr. Jordan’s claim. Moreover, Mr. Jordan’s void ab initio argument does not give adequate weight to the finality of judgments. The Supreme Court has repeatedly denied attempts to reopen final dec isions in the fac e of new judicial pronouncement s or decisions finding statutes uncons titutional. Se e , e. g. , Reynoldsville Casket Co. v. Hyde , 514 U.S. 749, 752 (1995) (new judic i al interpretations of a statute apply to “all pending cases”); Chicot County Drainage Dis t. v. Baxter State Bank , 308 U.S. 371, 374-75 (1940) (uphol ding a decision that was based on a statute later found unconstitutional)

. Thus, even in t he extreme instance of unconstitutional application of a stat ute, the Supreme Court does not supply a retroactive remedy for final judgments. In sum, Mr. Jordan’s void ab initio argument has no leg a l s upport and does not accord suffi cient respect to a fi nal judgment. Accordingly, this court affirms the Veterans Court’s determinati on that CUE does not arise from a new regulatory interpretation of a statute.

04-7034 6COSTS Each party shall bear its own costs. AFFIRMED

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