[00:00:00] Speaker 04:
to hear when a judge is trying to ask a question and counsel is speaking.

[00:00:06] Speaker 04:
So what I'd like you to do as counsel is to be alert to the fact that if we raise our hands like this, you should stop speaking and wait for the question.

[00:00:18] Speaker 04:
And with that, Mr. Carpenter, why don't you go ahead?

[00:00:23] Speaker 03:
Thank you very much, Andrew.

[00:00:24] Speaker 03:
May it please the court?

[00:00:25] Speaker 03:
Count Carpenter appearing on behalf of Mr. Dennis DeValle.

[00:00:29] Speaker 03:
The matter before the court is whether or not the Veterans Court erred when it found that Mr. LaValle was not a prevailing party in his IJA application.

[00:00:37] Speaker 03:
Mr. LaValle's appeal resulted in an enforceable judgment in the form of a remand, which materially altered the legal relationship of the parties, in this case, the VA and Mr. DeValle.

[00:00:50] Speaker 03:
Having done so, that made Mr. DeValle a prevailing party as a matter of law.

[00:00:56] Speaker 03:
The Veterans Court set aside

[00:00:59] Speaker 03:
the board's decision and remanded the matter for further proceedings to address Mr. LaValle's argument and this court's decision in Lynch in the first instance.

[00:01:10] Speaker 03:
Lynch in this case had been decided after the board decision that was on appeal.

[00:01:15] Speaker 03:
The Veterans Court in its discretion determined that it would be better to have the board

[00:01:21] Speaker 03:
address that issue in the first instance and therefore ordered a remand.

[00:01:26] Speaker 03:
This conference is now being recorded.

[00:01:28] Speaker 02:
If you have any objections, you may disconnect at this time.

[00:01:35] Speaker 03:
I'm sorry.

[00:01:38] Speaker 03:
Was there a question?

[00:01:40] Speaker 03:
No, that was not the recorded message.

[00:01:43] Speaker 03:
Oh, I'm sorry.

[00:01:44] Speaker 03:
Okay.

[00:01:49] Speaker 03:
I think I lost my train of thought here.

[00:01:53] Speaker 03:
The Veterans Court set aside the board's decision and remanded the matter for further proceedings.

[00:01:57] Speaker 03:
Mr. Carter.

[00:02:00] Speaker 03:
Yes.

[00:02:01] Speaker 02:
Yeah.

[00:02:02] Speaker 02:
So let me ask you this question.

[00:02:04] Speaker 02:
And I think this case kind of focuses on this.

[00:02:08] Speaker 02:
Is a remand due to a change in law?

[00:02:12] Speaker 02:
Or is it due to an actual administrative error, a wrong decision by the board?

[00:02:23] Speaker 03:
I'm not sure that the Veterans Court characterized it one way or the other in this case, although clearly they did not make a finding of administrative error.

[00:02:36] Speaker 02:
I believe that the question- Part of the remand instruction was so that the board could consider in the first instance the application of Lynch, correct?

[00:02:48] Speaker 03:
That's correct, John.

[00:02:49] Speaker 02:
So that's not an administrative error.

[00:02:52] Speaker 02:
Okay.

[00:02:54] Speaker 02:
Well, isn't our precedent pretty clear on this particular point that if it's not an administrative error, and especially if remand is to consider intervening law or changing the law, then that's something different.

[00:03:11] Speaker 03:
Well, as I understood this court's decision in Lynch, they were not changing the law.

[00:03:15] Speaker 03:
They were merely clarifying the law and that

[00:03:20] Speaker 03:
In that decision, they made it clear that in applying the benefit of the Dow rule, that the preponderance of evidence was not the legal standard, and that the legal standard was the standard that had been accepted across the board.

[00:03:40] Speaker 03:
And I believe that the Veterans Court, I'm sorry.

[00:03:43] Speaker 02:
Do you characterize that as an administrative error?

[00:03:51] Speaker 03:
The boards misapplication of the benefit of the doubt rule.

[00:03:55] Speaker 03:
Yes.

[00:03:57] Speaker 03:
Okay.

[00:03:58] Speaker 04:
So, so Mr. Carpenter, as I read the Veterans Court decision here, the remand was not just to consider Lynch, but also to consider the arguments about the preponderance standard that you made in your briefs before the Veterans Court.

[00:04:17] Speaker 04:
So this is not simply a case in which there was new law to be considered on the remand, but also the existing arguments that were made.

[00:04:27] Speaker 03:
That's correct, Your Honor.

[00:04:30] Speaker 03:
And I believe in that context, this is not a typical change of law case, that it is in fact a response by the reviewing court as to whether or not they felt comfortable in making the decision in the first instance based upon the arguments that had been presented by

[00:04:53] Speaker 03:
myself on behalf of Mr. LaValle concerning the preponderance of evidence standard, which this court clarified to some extent in Lynch, but quite candidly, I don't believe addressed the question that was presented by Mr. LaValle in his appeal to the Veterans Court in the first instance.

[00:05:13] Speaker 03:
as it related to making the decision on whether or not he was entitled to a total scheduler rating or an extra scheduler rating based upon TDIU.

[00:05:27] Speaker 04:
Before the Board, I know you argued the preponderance standard was wrong before the Veterans Board.

[00:05:36] Speaker 04:
But in the initial proceeding, did you argue that the preponderance standard was incorrect in your briefing before the board?

[00:05:45] Speaker 03:
Before the board, no, Your Honor.

[00:05:46] Speaker 03:
I had no idea or reason to believe that they were going to be using that standard in their decision.

[00:05:53] Speaker 03:
I found that out when I got the decision.

[00:05:57] Speaker 03:
OK.

[00:05:58] Speaker 03:
Judge Daul, I believe you indicated that.

[00:06:01] Speaker 01:
Yeah, I was just going to ask about

[00:06:04] Speaker 01:
It's my understanding that you were arguing for that the board aired in its application of the standard even before Lynch was decided.

[00:06:15] Speaker 01:
Is that correct?

[00:06:16] Speaker 01:
That is correct.

[00:06:17] Speaker 01:
If you were making that argument?

[00:06:19] Speaker 03:
Yes.

[00:06:19] Speaker 01:
And could you flesh that argument out for me a little bit?

[00:06:22] Speaker 01:
Were you arguing that they aired by applying the benefit of the doubt rule?

[00:06:32] Speaker 03:
Overall, I believe that that was

[00:06:34] Speaker 03:
the direction of the argument.

[00:06:38] Speaker 03:
The argument was essentially that the preponderance of evidence is a separate legal standard and that the Congress created a legal standard with the benefit of the doubt.

[00:06:51] Speaker 03:
And in so doing, the only appropriate legal standard would have been the benefit of the doubt rather than using a

[00:06:59] Speaker 03:
external legal standards such as preponderance of the evidence, which in my view has no place in the veteran system, but was obviously used in this case to defeat an award that we believe under the proper legal standard should have been awarded under either theory.

[00:07:22] Speaker 01:
I noticed that initially you were successful in making that argument before the Veterans Court.

[00:07:30] Speaker 01:
What is your understanding of why the Veterans Court changed its view?

[00:07:36] Speaker 03:
I wouldn't begin to speculate.

[00:07:37] Speaker 03:
I do not understand why they changed their view.

[00:07:43] Speaker 03:
It seemed to me that possibly there was some second thoughts on the part of

[00:07:52] Speaker 03:
the lower court in terms of whether or not Lynch did or didn't constitute a change in the law.

[00:08:03] Speaker 03:
But again, I don't believe that Lynch dealt with this issue per se, although this court in its decision talked about the preponderance of evidence standards.

[00:08:19] Speaker 03:
not being what this court meant in its original decision dealing with the interpretation of the benefit of the Dow.

[00:08:33] Speaker 03:
Unless there's any further questions from the panel, I'm happy to submit it based upon them.

[00:08:38] Speaker 04:
I'll let you reserve the remainder of your time.

[00:08:42] Speaker 04:
Thank you.

[00:08:45] Speaker 04:
Sheila, our courtroom deputy, in my screen there's a bar going across saying this meeting is being recorded, which prevents me from seeing my colleagues.

[00:08:55] Speaker 04:
Is there some way to remove that bar?

[00:08:59] Speaker 04:
Is there an option to say okay?

[00:09:02] Speaker 04:
Yeah, I clicked on that, but it didn't seem to do it.

[00:09:06] Speaker 04:
Now it's gone.

[00:09:07] Speaker 04:
Okay.

[00:09:08] Speaker 04:
Okay, wonderful.

[00:09:14] Speaker 04:
All right, Ms.

[00:09:15] Speaker 04:
Havessy.

[00:09:16] Speaker 00:
Yes, good morning, Your Honors, and may it please the court.

[00:09:20] Speaker 00:
It appears from Mr. Luval's reply brief that the remaining issue in this case is whether there was a material alteration in the legal relationship between the parties.

[00:09:33] Speaker 00:
And that question, if that is the question before the court, is one over which this court lacks jurisdiction, because that is simply an application of the IJA law.

[00:09:44] Speaker 00:
to the facts of this case.

[00:09:48] Speaker 04:
Let me ask you a question.

[00:09:49] Speaker 04:
Suppose the remand order here had said nothing about the Lynch case.

[00:09:55] Speaker 04:
It had simply remanded to consider Mr. Carpenter's arguments about the preponderance standard and the benefit of the doubt rule.

[00:10:05] Speaker 04:
Would that have made Mr. Carpenter's client a prevailing party?

[00:10:11] Speaker 00:
Not necessarily.

[00:10:13] Speaker 00:
That, again, would be an application of the law to the facts because it would be a factual determination on the part of- No, I don't think it's a law.

[00:10:21] Speaker 04:
It's a question whether that kind of action as a legal matter would be sufficient to make him a prevailing party.

[00:10:30] Speaker 04:
What's the answer to that?

[00:10:32] Speaker 00:
Well, the answer is it depends if there was an administrative error or not.

[00:10:38] Speaker 00:
There could be a remand.

[00:10:40] Speaker 04:
You know what the facts of the case are.

[00:10:42] Speaker 04:
And my hypothetical is there was a remand to consider Mr. Carpenter's arguments about the benefit of the doubt standard in his briefs.

[00:10:51] Speaker 04:
Would that remand make him a prevailing party under the Motorola line of cases?

[00:10:57] Speaker 00:
Not necessarily because a remand to consider his arguments that he made before the Veterans Court that could not have been made before the board because before the Veterans Court, he was making an argument based on 7103 D4 that the board decision was not an order of appropriate relief.

[00:11:16] Speaker 00:
That's not an argument that the board could have inherently could have considered because it's an argument about what the board decision contained.

[00:11:24] Speaker 00:
So

[00:11:25] Speaker 00:
to the extent that the court was remanding to consider arguments that were made by the court, before the court, then know that that inherently could not have been error.

[00:11:40] Speaker 04:
Suppose the remand order said, Mr. Carpenter's briefs argue that the preponderance of the evidence standard is the wrong standard.

[00:11:47] Speaker 04:
We remand to have the board consider that question.

[00:11:54] Speaker 00:
Again, that's not necessary.

[00:11:58] Speaker 04:
Go ahead.

[00:11:59] Speaker 00:
That's again not necessarily a finding of agency error.

[00:12:03] Speaker 00:
To say consider these arguments again is not the same thing as saying the board applied the incorrect standard and go back and apply the correct standard.

[00:12:16] Speaker 00:
That would be a finding of error.

[00:12:18] Speaker 00:
But just to say go back and reconsider these arguments without saying anything about whether the board

[00:12:26] Speaker 00:
use the wrong standard or not is not a finding of administrative error.

[00:12:33] Speaker 01:
So there seems to be a case law that says there can be an implicit finding of administrative error.

[00:12:42] Speaker 01:
I mean, there doesn't have to be an express finding of administrative error, right?

[00:12:47] Speaker 00:
Right.

[00:12:47] Speaker 00:
That's correct, Your Honor.

[00:12:48] Speaker 00:
But again, even saying that that's an implicit finding of error, it doesn't have to be.

[00:12:54] Speaker 00:
just sending it back to consider argument is not the Veterans Court either implicitly or explicitly finding error.

[00:13:04] Speaker 02:
In fact, isn't it the case that the Veterans Court remanded with instruction to consider in the first instance?

[00:13:12] Speaker 02:
And that indicates to me that it can go either way.

[00:13:15] Speaker 02:
I mean, we don't have a final decision on this particular point.

[00:13:20] Speaker 02:
under a situation like that, how can there be administrative error?

[00:13:25] Speaker 00:
Yes, Your Honor, I would agree with that.

[00:13:28] Speaker 00:
In this particular case, not necessarily Judge Dyke's hypothetical, but in this case, yes, the Veterans Court did specifically say remand in the first instance to consider Lynch and Mr. Luval's arguments.

[00:13:43] Speaker 00:
So there was no error.

[00:13:46] Speaker 02:
Would your view be different if the remand order instead of saying considering the persistence instructed the board to consider a specific position or a specific point of view as to the proper standard?

[00:14:05] Speaker 02:
In other words, if they would have said you applied the wrong standard, we're going to send it back to you so that you can apply the correct standard.

[00:14:12] Speaker 02:
And here's that correct standard.

[00:14:14] Speaker 02:
Is that a different situation than what we have here?

[00:14:17] Speaker 00:
That's a different situation because in your words the Veterans Court is specifically saying board you applied the wrong standard.

[00:14:25] Speaker 00:
If the Veterans Court is explicitly or even implicitly saying board you applied the wrong standard and here's the correct standard that certainly could be considered an administrative error.

[00:14:37] Speaker 01:
I want to ask a question now.

[00:14:39] Speaker 01:
In this case, I see a little bit of a difference than some of the other cases where we've said a remand for a change in law will not be administrative error.

[00:14:50] Speaker 01:
And one of the reasons why I'm maybe seeing a difference is because here the appellant specifically argued that the standard applied by the board was incorrect.

[00:15:00] Speaker 01:
then the Veterans Court doesn't say that the standard applied by the board is incorrect.

[00:15:04] Speaker 01:
But there's a Lynch-like argument made saying that the standard should be a benefit of the doubt and not preponderance of the evidence.

[00:15:13] Speaker 01:
There shouldn't be confusion about that.

[00:15:15] Speaker 01:
That seems to have been made in the first instance on appeal before Lynch was decided.

[00:15:21] Speaker 01:
Then Lynch is decided, and then the case is remanded.

[00:15:25] Speaker 01:
Now, I could see that as being different than a circumstance where there's just a change in law and the party never presented that change in law.

[00:15:33] Speaker 01:
How do you feel about that, Ms.

[00:15:35] Speaker 01:
Havasie?

[00:15:37] Speaker 00:
I still think that's not necessarily sufficient for a finding of administrative error, just to say, board, go back and rethink about whether you used the wrong standard is not the same thing as the example Judge Raina gave where the court would say, you did use the wrong standard, board, go back and fix it, just to say, go back and

[00:16:05] Speaker 00:
reconsider these arguments is not necessarily administrative error.

[00:16:13] Speaker 04:
which have considered these remand issues and have found that a change in law doesn't make somebody a prevailing party a remand to consider a change in law.

[00:16:25] Speaker 04:
But those cases are all cases in which the change in law was the result of a statute or some new argument that wasn't made by the

[00:16:39] Speaker 04:
a party to the appeal, right?

[00:16:41] Speaker 04:
I mean, for example, in Thompson, the Veterans Court specifically said this isn't a situation in which this is further support for an argument that was already being made.

[00:16:57] Speaker 04:
Those are new issue cases, in other words.

[00:17:01] Speaker 00:
Right, but, but even in Thompson, which uses an example, it was the appellant there argued similar to hear that it was simply a clarification of existing law and this court rejected that argument saying that even

[00:17:19] Speaker 00:
a case that clarifies existing law, which you could argue Lynch did for Ortiz, even such a case falls under the category of a remand for new law, which does not constitute administrative error.

[00:17:36] Speaker 04:
But those were cases in which the new law related to a new issue that hadn't been argued by the party to the appeal, right?

[00:17:46] Speaker 00:
I am not sure about the Thompson case specifically, whether it had been a new issue that had been argued or not argued, although based on the fact that it was a clarification and the argument was that it was a clarification, I would suspect it would have been an issue that at some level had been

[00:18:10] Speaker 00:
before the board initially, because otherwise, how could there be an argument that it was simply a clarification of existing law if that existing law had been argued below in the first place?

[00:18:25] Speaker 04:
Well, I think the Veterans Court there specifically said that this was not an issue that had been raised by the party.

[00:18:40] Speaker 04:
But why if somebody has gone to the trouble of making an argument, spending money developing the argument?

[00:18:49] Speaker 04:
and the argument results in a remand, I'm not sure that I understand why that person shouldn't be a prevailing party, quite apart from whether there was some new case law which supported the argument that the party was already making.

[00:19:07] Speaker 04:
The legal fees were incurred, they were incurred on the particular issue.

[00:19:11] Speaker 04:
Why is it that consistent with the purpose of the statute, there shouldn't be an award of attorney's fees for success?

[00:19:18] Speaker 00:
Well, I mean, Your Honor, this court's precedent holds that in the case of remands, it is clear that administrative error is required to be a prevailing party.

[00:19:30] Speaker 00:
So in that case, fees under the Aegis Statute's definition of prevailing party have to be based on this notion of administrative error.

[00:19:41] Speaker 00:
And this court's precedent is also clear that a remand for new law does not meet that standard.

[00:19:54] Speaker 04:
Do you want to go further?

[00:19:55] Speaker 00:
No, Your Honor.

[00:19:58] Speaker 00:
We respectfully request this court affirm the Veterans Court.

[00:20:03] Speaker 04:
Thank you, Mr. Carpenter.

[00:20:06] Speaker 04:
You have a couple of minutes left, I think.

[00:20:11] Speaker 04:
You're muted.

[00:20:11] Speaker 03:
Excuse me.

[00:20:23] Speaker 03:
Are you ready?

[00:20:24] Speaker 03:
Yes.

[00:20:24] Speaker 03:
Yes, OK.

[00:20:26] Speaker 03:
I'd like to begin by pointing out that the Veterans Court, in its decision at appendix one to two, recognized that administrative error is not the only standard, that it is one of the standards that is established by the case law.

[00:20:43] Speaker 03:
The other is, and this was established by the Supreme Court, that there is a material change in the legal relationship of the parties.

[00:20:51] Speaker 03:
which was applied by this court in Motorola.

[00:20:55] Speaker 03:
And in that context, we have to come back to the fact that this is a fee-shifting statute that we're dealing with here.

[00:21:03] Speaker 03:
We're not dealing with what the change in the law may or may not have been.

[00:21:08] Speaker 03:
We are dealing with whether or not there was a legal relationship, a material change in the legal relationship of the parties.

[00:21:19] Speaker 02:
luval was i'm sorry yeah mr carpenter can you can you please explain that i always have a little bit difficulty in fully understanding that particular uh doctrine the change in the in the legal relationship of the parties how how did that happen here it happened here because mr

[00:21:41] Speaker 03:
Louisville was required to take a civil action, file an appeal based upon an adverse decision by the Board of Veterans Appeals.

[00:21:51] Speaker 03:
That Board of Veterans Appeals decision was set aside by the Veterans Court.

[00:21:57] Speaker 03:
And regardless of what the reason was, that changed the material relationship of the parties because that board decision is no longer final.

[00:22:09] Speaker 03:
It is now subject to a court order

[00:22:11] Speaker 03:
directing that the board's decision be set aside and re-adjudicated.

[00:22:18] Speaker 03:
When it's re-adjudicated, that re-adjudication results in a new decision that is subject to a new appeal.

[00:22:27] Speaker 03:
Therefore, under IJA, he is entitled to be compensated as a prevailing party because he was forced to bring an appeal, which he fully briefed

[00:22:38] Speaker 03:
got a decision, in fact two decisions, from the Veterans Court, changing the court's mind on whether or not he was or wasn't a prevailing party.

[00:22:49] Speaker 03:
But what he was, was a party that received a material alteration in the legal relationship of the parties.

[00:22:56] Speaker 03:
Yes, Joseph, I'm sorry.

[00:22:58] Speaker 01:
That's okay.

[00:23:00] Speaker 01:
What you just said sounds very logical, but the concern I have is that it would undermine our case law that says that when there's a remand because of a change in law, that is not sufficient for Egypt fees, right?

[00:23:16] Speaker 01:
And so that seems inconsistent with the general principle that when you have a judgment against you, but then it's vacated,

[00:23:24] Speaker 01:
for remand, for reconsideration, that automatically results in a change in the relationship between the parties.

[00:23:30] Speaker 03:
And I would suggest that that rule of law, as established by this court, based upon a change in law, constitutes an exception.

[00:23:42] Speaker 03:
But as we have discussed in this argument, Mr. Luvall presented a straight legal argument about whether or not it was lawful and correct

[00:23:53] Speaker 03:
for the board to have relied upon the preponderance of evidence standard as the legal standard for the granting or denying of his benefits.

[00:24:03] Speaker 03:
That was a legal error.

[00:24:05] Speaker 03:
The lower court could have addressed that on its merits.

[00:24:09] Speaker 03:
It did not have to send it back because nothing in this court's decision in Lynch would have required a different outcome on that legal question.

[00:24:20] Speaker 03:
But the court decided in its discretion, and certainly Mr. LaValle understands that, that the matter went back for the board to have an opportunity to address the preponderance of evidence argument that was made to the court and to consider in the first instance the decision made by this court in Lynch, which then touched upon the question of the role of the preponderance of evidence.

[00:24:50] Speaker 03:
But I don't believe that this court went so far in Lynch to say that that was legal error for them to have done that.

[00:24:58] Speaker 03:
That was the argument that was presented by Mr. LaValle to the Veterans Board.

[00:25:04] Speaker 04:
And ultimately, as a result of the remand that he secured, the board applied a different standard, approximate balance, and applying that new standard gave relief to Mr. LaValle, right?

[00:25:20] Speaker 03:
That's correct.

[00:25:22] Speaker 03:
relief that in our judgment could have been afforded by the Veterans Court in the first instance.

[00:25:28] Speaker 03:
And that's the whole purpose, in my view, of judicial review.

[00:25:34] Speaker 03:
The whole notion of what Congress created was a national court to review the decisions of the Board of Veterans Appeals.

[00:25:44] Speaker 03:
He filed an appeal, having been adversely affected by the decision of the board,

[00:25:49] Speaker 03:
to obtain judicial review.

[00:25:51] Speaker 03:
He didn't get judicial review.

[00:25:53] Speaker 03:
He got a remand that gave the board a chance to correct their error, which, as the court has noted, it did.

[00:26:04] Speaker 03:
And to deny him prevailing party status just seems to be inconsistent with the whole purpose from Congress for the creation of Egypt, separate and apart

[00:26:17] Speaker 03:
from the legal questions of preponderance of evidence as a legal standard.

[00:26:24] Speaker 03:
I don't believe I have anything further unless there's further questions from the panel.

[00:26:30] Speaker 04:
Hearing none, thank both counsel.

[00:26:31] Speaker 04:
The case is submitted.

[00:26:34] Speaker 04:
Thank you.