[Federal Register Volume 68, Number 200 (Thursday, October 16, 2003)]
[Rules and Regulations]
[Pages 59540-59542]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-26252]


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DEPARTMENT OF VETERAN AFFAIRS

38 CFR Part 3

RIN 2900-AL55


Disease Associated With Exposure to Certain Herbicide Agents: 
Chronic Lymphocytic Leukemia

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: This document amends the Department of Veterans Affairs (VA) 
adjudication regulations concerning presumptive service connection for 
certain diseases for which there is no record during service. This 
amendment is necessary to implement the decision of the Secretary of 
Veterans Affairs that there is a positive association between exposure 
to herbicides used in the Republic of Vietnam during the Vietnam era 
and the subsequent development of chronic lymphocytic leukemia (CLL). 
The effect of this amendment is to establish presumptive service 
connection for that condition based on herbicide exposure.

DATES: Effective Date: October 16, 2003.

FOR FURTHER INFORMATION CONTACT: Cheryl Konieczny, Regulations Staff, 
Compensation and Pension Service, Veterans Benefits Administration, 810 
Vermont Avenue, NW., Washington, DC 20420, telephone (202) 273-6779.

SUPPLEMENTARY INFORMATION: In a document published in the Federal 
Register on March 26, 2003 (68 FR 14567-14570), VA proposed to amend 
its adjudication regulations to provide for a presumption of service 
connection for CLL based on herbicide exposure. VA provided a 60-day 
comment period which ended on May 27, 2003. We received a written 
comment from Vietnam Veterans of America (VVA) and a joint written 
comment from two individuals.

Comments Supporting the Proposed Rule

    The joint comment from two individuals expressed support for the 
proposed rule.

Outreach Mechanisms

    One commenter urged that the final rule specifically state that VA 
will develop and implement outreach mechanisms by which attempts will 
be made to contact all in-country Vietnam veterans who are eligible for 
this benefit.
    VA has already initiated a number of outreach activities. In 
January 2003, VA issued a news release concerning the Secretary's 
decision regarding CLL. This news release has also been distributed at 
health fairs, health care conferences, and on the National Mall in 
conjunction with Public Service Recognition Week. An article conveying 
this information can currently be found on VA's Web site. The lead 
article of the July issue of the Agent Orange Review, which will be 
sent to hundreds of thousands of Vietnam veterans, is about the 
Secretary's decision regarding CLL. Further, outreach efforts are 
procedural in nature, and are outside the scope of this rulemaking; 
therefore, no change is made based on this comment.

Establish a Retroactive Effective Date

    The same commenter urged that the final rule state that 
compensation for CLL will be retroactive for those eligible in-country 
Vietnam veterans who had previously applied for benefits based on CLL 
and were denied. We will make no change based on this comment because 
VA does not have authority to award such retroactive benefits. As 
explained below, existing statutes make clear that VA may not award 
retroactive benefits based on this final rule for any period before the 
date this final rule is published in the Federal Register. Those 
statutes prohibit VA from granting benefits retroactive to the date of 
a previously denied claim. No statute or judicial decision authorizes 
VA to ignore those statutory requirements for purposes of this final 
rule.
    Title 38 U.S.C. 1116(c)(2) clearly and unambiguously requires that 
regulations promulgated as a result of a decision of the Secretary of 
Veterans Affairs that a positive association exists between exposure to 
herbicides and a specified condition or disease ``shall be effective on 
the date of issuance.'' The effective date established by this rule is 
in accordance with 38 U.S.C. 1116(c)(2). Under 38 U.S.C. 5110(g), when 
benefits are awarded based on a new regulation, the effective date of 
the award may not be earlier than the effective date of the regulation. 
In view of 38 U.S.C. 1116(c)(2) and 5110(g), VA does not have authority 
to provide in this rule for assignment of an effective date earlier 
than the date on which this rule is issued.
    We note that a series of orders from the United States District 
Court for the Northern District of California in the class-action 
litigation in Nehmer v. U.S. Veterans' Administration requires VA to 
pay retroactive benefits for certain diseases associated with herbicide 
exposure, in certain circumstances, in a manner that would otherwise be 
prohibited by 38 U.S.C. 1116(c)(2) and 5110(g). We conclude, however, 
that those orders do not apply to benefits based on a disease for which 
the Secretary of Veterans Affairs establishes a presumption of service 
connection after September 30, 2002.
    The Nehmer court orders rely upon a May 1991 Final Stipulation and 
Order between the parties to that litigation. The 1991 stipulation and 
order required VA to accord retroactive effect to presumptions of 
service connection established by VA pursuant to the Agent Orange Act 
of 1991, Public Law 102-4. The Agent Orange Act of 1991, Public Law 
102-4, established a sunset date of September 30, 2002, for the 
Secretary to establish such presumptions. Accordingly, the Nehmer 
stipulation and order applies only to awards based on presumptions 
established within the

[[Page 59541]]

time frame specified in the Agent Orange Act of 1991, Public Law 102-4.
    The Agent Orange Act of 1991, Public Law 102-4, added section 1116 
to title 38, United States Code. Section 1116(b) authorized the 
Secretary of Veterans Affairs to issue regulatory presumptions of 
service connection for diseases associated with herbicide exposure. 
Section 1116(e), as added by the Act, stated that section 1116(b) would 
cease to be effective 10 years after the first day of the fiscal year 
in which the NAS transmitted its first report to VA. The first NAS 
report was transmitted in June 1993, during the fiscal year that began 
on October 1, 1992. Accordingly, under the Act, VA's authority to issue 
regulatory presumptions as specified in section 1116(b) would have 
expired on September 30, 2002.
    In December 2001, Congress enacted the Veterans Education and 
Benefits Expansion Act of 2001 (Benefits Expansion Act), Public Law 
107-103, section 201(d) of which extended VA's authority under section 
1116(b) through September 30, 2015. Pursuant to this statute, VA may 
issue new regulations between October 1, 2002, and September 30, 2015, 
establishing additional presumptions of service connection for diseases 
that are found to be associated with herbicide exposure based on 
evidence contained in future NAS reports. Because presumptions 
established pursuant to the authority of the Benefits Expansion Act, 
Public Law 107-103 are beyond the scope of the Nehmer stipulation and 
order, the effective-date provisions of the stipulation and order would 
not apply to benefit awards based on those presumptions.
    The United States District Court for the Northern District of 
California and the United States Court of Appeals for the Ninth Circuit 
stated that the Nehmer stipulation and order applies only to awards 
based on presumptions issued within the time period established by the 
Agent Orange Act of 1991, Public Law 102-4. The district court noted 
that the retroactive payment provisions of the stipulation and order 
are ``expressly tied'' to the Agent Orange Act of 1991, Public Law 102-
4, and that ``the Stip. & Order is not therefore boundless.'' Nehmer v. 
United States Department of Veterans Affairs, No. CV-86-6160 TEH (N.D. 
Cal. Dec. 12, 2000). The Ninth Circuit stated that ``the district court 
was careful to prescribe temporal limits on the effect of the consent 
decree, with which we agree.'' Nehmer v. Veterans' Administration, 284 
F.3d 1158, 1162 n.3 (9th Cir. 2002).
    In its December 12, 2000, order, the district court held that the 
1991 stipulation and order must be interpreted in accordance with 
general principles of contract law. It is well established that, unless 
the parties provide otherwise, a contract is presumed to incorporate 
the law that existed at the time the contract was made. See Norfolk & 
Western Ry. Co. v. American Train Dispatchers' Ass'n, 499 U.S. 117, 
129-30 (1991). The terms of a contract ``do not change with the 
enactment of subsequent legislation, absent a specific contractual 
provision providing for such a change.'' Winstar Corp. v. United 
States, 64 F.3d 1531, 1547 (Fed. Cir. 1995), aff'd, 518 U.S. 839 
(1996). A subsequent change in the law cannot retrospectively alter the 
terms of the agreement. See Florida East Coast Ry. Co. v. CSX 
Transportation, Inc., 42 F.3d 1125, 1129-30 (7th Cir. 1994). 
Accordingly, the enactment of the Benefits Expansion Act of 2001 cannot 
expand the Government's authority under the May 1991 stipulation and 
order.
    VA is required to give effect to the clear statutory requirements 
in 38 U.S.C. 1116(c)(2) and 5110(g), in the absence of authority to the 
contrary. To the extent the Nehmer court orders require action 
seemingly at odds with those statutes, we believe they are most 
reasonably viewed as creating a non-statutory exception to the 
requirements of 38 U.S.C. 1116(c)(2) and 5110(g). We believe it would 
be inappropriate, however, to disregard the clear requirements of 
section 1116(c)(2) and 5110(g) in cases that are not within the scope 
of the Nehmer court orders. The United States Court of Appeals for the 
Federal Circuit and the United States Court of Appeals for Veterans 
Claims have held that 38 U.S.C. 5110(g) governs the effective date of 
awards made pursuant to regulatory presumptions of service connection 
for diseases associated with herbicide exposure, at least in cases that 
are not clearly within the scope of the Nehmer court orders. See 
Williams v. Principi, 15 Vet. App. 189 (2001) (en banc); aff'd, 310 
F.3d 1374 (Fed. Cir. 2002). Accordingly, the district court orders in 
the Nehmer case do not permit VA to ignore the clear requirements of 38 
U.S.C. 1116(c)(2) and 5110(g) as they apply to this final rule or to 
grant retroactive benefits in a manner prohibited by those statutes. We 
therefore make no change based on this comment.

Eligibility of Widows

    The commenter urged that the final rule state that widows of in-
country Vietnam veterans who died as a result of CLL are eligible for 
dependency and indemnity compensation (DIC). This rule is not intended 
to define the criteria governing eligibility for DIC or any other 
benefit. Several existing statutes and regulations already provide that 
veterans and their survivors are entitled to benefits for disability or 
death due to a service-connected disease or injury. This rule would 
establish a presumption that CLL is service connected in veterans who 
were exposed to certain herbicide agents used in Vietnam and who 
subsequently developed that disease. That presumption will assist 
claimants in establishing entitlement to specific benefits under the 
statutes and regulations authorizing such benefits, and will apply 
whether the claimant is a veteran seeking compensation or a survivor 
seeking service-connected death benefits. We therefore make no change 
based on this comment, because the suggested change is beyond the scope 
of this rule and is unnecessary.

Extend Eligibility to Those Who Served on Naval Vessels

    The commenter urged that we extend eligibility to service 
connection for CLL to all Vietnam veterans who served within the 
geographical boundaries of the Republic of Vietnam and those who served 
on naval vessels within the territorial waters of the Republic of 
Vietnam. As revised by this final rule, 38 CFR 3.309(e) will expressly 
provide that CLL will be presumed service connected in any veteran who 
was exposed to certain herbicide agents during service. Veterans who 
served in the Republic of Vietnam between January 9, 1962, and May 7, 
1975, are presumed to have been exposed to such herbicide agents. 
Veterans who served only in other locations or at other times, 
including those who served on naval vessels in the territorial waters 
of Vietnam but never set foot within the Republic of Vietnam, would 
need to establish that they were exposed to herbicide agents during 
service.
    Title 38 U.S.C. 1116 requires that a veteran have served ``in the 
Republic of Vietnam'' to be eligible for the presumption of exposure to 
herbicides. 38 CFR 3.307(a)(6)(iii) provides that ``Service in the 
Republic of Vietnam'' includes service in offshore waters or other 
locations only if the conditions of service involved duty or visitation 
within the Republic of Vietnam. In interpreting similar language in 38 
U.S.C. 101(29)(A), VA's General Counsel has concluded that service in a 
deep-water vessel in waters offshore the Republic of Vietnam does not 
constitute service ``in the Republic of Vietnam.'' (See VAOPGCPREC 27-
97.) VA's regulatory definition of ``Service in the Republic of 
Vietnam'' predates the

[[Page 59542]]

enactment of section 1116(a)(3) (see former 38 CFR 3.311a(a)(1)(1990)), 
and we find no basis to conclude that Congress intended to broaden that 
definition. The commenter cited no authority for concluding that 
individuals who served in the waters offshore of the Republic of 
Vietnam were subject to the same risk of herbicide exposure as those 
who served within the geographic boundaries of the Republic of Vietnam, 
or for concluding that offshore service is within the meaning of the 
statutory phrase ``Service in the Republic of Vietnam.'' We therefore 
make no change based on this comment.

CLL and Non-Hodgkin's Lymphoma

    The commenter stated that because of the common etiology and shared 
symptoms between CLL and non-Hodgkin's lymphoma (NHL), all in-country 
Vietnam veterans who are eligible for compensation because of NHL 
should also be eligible for CLL diagnoses, treatment plans, and 
compensation.
    We disagree. While CLL and NHL may share certain traits and 
symptomatology, they are, nonetheless, distinct diagnostic entities, 
both of which VA presumes to result from herbicide exposure. We believe 
the responsibilities of diagnosing disease and establishing treatment 
plans must rest with health care professionals. Further, it would be 
improper and contrary to current statutes to provide for automatic 
compensation for a disease that the claimant may not even have. Whether 
a veteran has one of these conditions, or which one, must be 
established by competent medical evidence. Therefore, no changes have 
been made based on this comment.
    Based on the rationale set forth in the proposed rule document and 
this document, we are adopting the provisions of the proposed rule as a 
final rule without change.

Unfunded Mandates

    The Unfunded Mandates Reform Act requires, at 2 U.S.C. 1532, that 
agencies prepare an assessment of anticipated costs and benefits before 
developing any rule that may result in an expenditure by State, local, 
or tribal governments, in the aggregate, or by the private sector, of 
$100 million or more in any given year. This rule would have no such 
effect on State, local, or tribal governments, or the private sector.

Paperwork Reduction Act

    This document contains no provisions constituting a collection of 
information under the Paperwork Reduction Act (44 U.S.C. 3501-3521).

Executive Order 12866

    This final rule has been reviewed by the Office of Management and 
Budget under Executive Order 12866.

Regulatory Flexibility Act

    The Secretary hereby certifies that this regulatory amendment will 
not have significant economic impact on a substantial number of small 
entities as they are defined in the Regulatory Flexibility Act, 5 
U.S.C. 601-612. The reason for this certification is that this 
amendment would not directly affect any small entities. Only VA 
beneficiaries could be directly affected. Therefore, pursuant to 5 
U.S.C. 605(b), this amendment is exempt from the initial and final 
regulatory flexibility analysis requirements of 603 and 604.

Catalog of Federal Domestic Assistance Numbers

    The Catalog of Federal Domestic Assistance program numbers are 
64.109 and 64.110.

List of Subjects in 38 CFR Part 3

    Administrative practice and procedure, Claims, Disability benefits, 
Health care, Pensions, Veterans, Vietnam.

    Approved: August 27, 2003.
Anthony J. Principi,
Secretary of Veterans Affairs.


0
For the reasons set forth in the preamble, 38 CFR part 3 is amended as 
follows:

PART 3--ADJUDICATION

Subpart A `` Pension, Compensation, and Dependency and Indemnity 
Compensation

0
1. The authority citation for part 3, subpart A continues to read as 
follows:

    Authority: 38 U.S.C. 501(a), unless otherwise noted.

0
2. In Sec.  3.309, paragraph (e), the listing of diseases is amended by 
adding ``Chronic lymphocytic leukemia'' between ``Hodgkin's disease'' 
and ``Multiple myeloma'' to read as follows:


Sec.  3.309  Disease subject to presumptive service connection.

* * * * *
    (e) * * *
    Chronic lymphocytic leukemia
* * * * *
[FR Doc. 03-26252 Filed 10-15-03; 8:45 am]
BILLING CODE 8320-01-P