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4th Circuit sides with coal firm in black lung case

Read the decision: http://blogs.wvgazette.com/coaltattoo/ CHARLESTON, W.Va. -- Calling the behavior "hardly admirable," a federal appeals court said Friday that the actions of coal industry lawyers who withheld key medical evidence in a black lung benefits case did not rise to the level of "fraud on the court."

The 4th U.S. Circuit Court of Appeals questioned the actions of the Jackson Kelly lawyers but, at the same time, declined to wade too deeply into a dispute that has focused attention on the law firm's work opposing benefit claims for miners.

A three-judge panel ruled against the widow of a black lung victim, a deceased West Virginia miner named Gary Fox. Fox's widow, Mary, has been pursuing the case. Her husband was denied black lung benefits after Jackson Kelley lawyers, representing Elk Run Coal Co., withheld reports from two pathologists whose findings might have been helpful in proving he had black lung.

The case was featured in an October series by the Center for Public Integrity, a nonprofit journalism organization, which criticized coal industry lawyers and doctors it alleged abused the system to block disabled miners from receiving federal black lung benefits.

In a 20-page decision, the 4th Circuit ruled that concealing the pathology reports did not constitute "fraud on the court."

The U.S. Supreme Court has defined fraud on the court as a "deliberately planned and carefully executed scheme" that severely undermines the "integrity of the judicial process." Even perjury and fabricated evidence alone aren't enough to meet the extraordinary standard, the courts have said.

Judge J. Harvie Wilkinson wrote that the 4th Circuit saw "no reason to address" the case's broader implications when a "plain, narrow disposition is available.

"We bestow no blessing and place no imprimatur on the company's conduct, other than to hold that it did not, under a clear chain of precedent, amount to a fraud upon the court," Wilkinson wrote in a 20-page decision. "We now affirm and find that Elk Run's conduct, while hardly admirable, did not, under clear Supreme Court and circuit precedent, demonstrate the commission of a fraud upon the court."

Wilkinson wrote that the Fox case illustrates the way litigation is supposed to work.

"The adversary process exists because it permits each side to present its own case as well as to test its opponent's in order to expose vulnerabilities of every sort and variety," he wrote. "It is, to some extent, a self-policing mechanism."

Mary Hendrix, a spokeswoman for Jackson Kelly issued a statement saying the firm is pleased with the 4th Circuit's decision in that regard.

"We have always believed that the actions of our attorneys were lawful," the statement said. "For nearly 200 years, Jackson Kelly has represented clients across West Virginia and the nation, and we have always been known as strong and able advocates and we believe our conduct in this case was consistent with our duty to represent our client."

Morgantown lawyer Al Karlin, who represented Mary Fox, said he is disappointed in the decision but noted that the 4th Circuit neither endorsed Jackson Kelly's conduct nor resolved whether a lesser type of fraud had occurred or not.

"We are surprised that the court failed to appreciate the difficulty that Mr. Fox and so many other miners have in getting competent counsel in federal black lung claims to protect them from litigation tactics that undermine the pursuit of truth," Karlin said.

Along with the Fox case, Jackson Kelly faces a fraud lawsuit in Raleigh Circuit Court that alleges the firm wrongly concealed black lung evidence.

The Fox case and the Center for Public Integrity's investigation looked at issues that have long been simmering in the coalfields, where miners and their families routinely tell horror stories about their struggles to obtain black lung benefits promised to disabled miners by a law Congress passed in 1969.

Fox died in 2009, after working as a West Virginia coal miner for more than 30 years. Ten years before his death, Fox filed a claim for federal black lung benefits, proceeding in that effort without the help of an attorney. Elk Run, represented by Jackson Kelly, fought Fox's application.

Among other things, Elk Run hired two pathologists, Dr. Richard Naeye and Dr. P. Raphael Caffrey, to review slides of Fox's chest X-rays. Reports from those pathologists suggested Fox might have had black lung or, at least, that his work history put him at greater risk of lung disease.

During a hearing, though, Elk Run did not use the reports from Naeye and Caffrey as evidence. Instead, the company used reports from other pulmonary specialists, who -- like Fox and an administrative law judge -- were not shown the Naeye and Caffrey reports. Fox lost that case.

In 2006, Fox got a lawyer and filed a new benefits claim. Elk Run was forced to turn over the Naeye and Caffrey reports.

The company admitted liability for the 2006 claim, but Fox sought to set aside the 2001 ruling and obtain benefits going back to 1997.

Under the law, he had to prove that Elk Run committed "fraud on the court" -- rather than a lesser standard of fraud on one litigant -- to have a ruling that was more than one year old set aside.

An administrative law judge ruled in Fox's favor. The Benefits Review Board, which hears black lung appeals, granted Fox benefits going back to 2006 but overturned the judge's decision that the company had committed fraud on the court. Both sides appealed different portions of the board's ruling to the 4th Circuit.

In the 4th Circuit ruling, Wilkinson said that if any fraud occurred in the Fox case, it did not amount to "anything more than fraud involving injury to a single litigant.

"Elk Run's alleged fraud does not directly impact the integrity and workings of the black lung benefits process," the ruling said. "Fox does not allege that Elk Run bribed or otherwise improperly influenced any officials involved in the benefits process, nor does she claim that Elk Run encouraged or conspired with its witnesses to suborn perjury."

Wilkinson said that, in his initial black lung case, Gary Fox could have cross-examined company experts or asked if the company had additional pathology reports it had not disclosed -- or hired a lawyer to do so for him.

"That he did none of those things is not so much an indictment of the adversary system as it is a statement that he did not fully avail himself of it," Wilkinson wrote.

Wilkinson was appointed by President Ronald Reagan. Also on the 4th Circuit panel were Judges William B. Traxler Jr. and Henry F. Floyd. Traxler was appointed to district court by President George H.W. Bush and to the 4th Circuit by President Bill Clinton. Floyd was appointed to the district court by President George W. Bush and to the 4th Circuit by President Obama.

Reach Ken Ward Jr. at kward@wvgazette.com or 304-348-1702.


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