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Schmidt v. Spencer

United States District Court, District of Columbia

August 8, 2018

RICHARD V. SPENCER, Secretary, U.S. Department of the Navy, Defendant.



         Jeffrey Schmidt challenges a 2011 decision by the Board for Correction of Naval Records. The Board declined to reconsider a decision it made nineteen years earlier. In that 1992 decision, the Board refused to change the separations disability rating assigned by the Navy when Schmidt was discharged in 1989. Before the Court is the Secretary of the Navy's Motion for Summary Judgment. Dkt. 33. For the reasons that follow, the Court will grant the motion.

         I. BACKGROUND

         A member of the military “may be separated” from the military if a military secretary, such as the Secretary of the Navy, determines that the member is “unfit to perform [his or her] duties” due to physical disability. 10 U.S.C. § 1203(a). The secretary assesses whether the member can perform his or her duties through a physical evaluation board. See Disability Evaluation System, Department of Defense Instruction No. 1332.18 at 16-19 (Aug. 5, 2014). The physical evaluation board may recommend separation and certain disability ratings that affect pay and benefits upon separation. See 10 U.S.C. §§ 1203(b), 1212(a); Department of Defense Instruction No. 1332.18 at 18; Navy Disability Evaluation Manual, SECNAVINST 1850.4E § 3801. The “sole standard” for separations disability ratings is fitness to perform military duties. SECNAVINST 1850.4E §§ 3301, 3306. This suit arises from Jeffrey Schmidt's encounter with a physical evaluation board.

         Schmidt enlisted in the United States Marine Corps in 1983. Administrative Record (AR) 18, Dkt. 30. During his time in service, he served as a field radio operator, rose to the rank of corporal, and was awarded the Good Conduct Medal and the Sea Service Deployment Ribbon. Id. In December 1988, a Navy physical evaluation board found that Schmidt had suffered from non-combat-related lower back pain for several years, and a water-skiing incident had caused the pain to increase in the months before the evaluation board. AR 76, 80. Due to the pain, Schmidt had been unable to run for the prior two and a half years, AR 80, and according to his commanding officer, Schmidt's injuries “ke[pt] him from participating in physical fitness tests, field duty, troop marches, any prolonged walking or standing and other activities required of the basic Marine, ” AR 83. The physical evaluation board concluded that Schmidt was unfit for full duty and would not be fit for full duty within a reasonable period of time. AR 76, 81. The board also rated Schmidt's lower back condition as 10% disabling. AR 76. After receiving counseling on the board's findings from a Disability Evaluation System counselor, Schmidt signed a certification stating that he accepted the findings of the physical evaluation board. AR 78.

         The next month, after the Navy Judge Advocate General performed a legal review, the physical evaluation board notified the Commandant of the Marine Corps of its finding that Schmidt was unfit for duty and recommended that Schmidt be separated from the Marine Corps under 10 U.S.C. § 1203. AR 74, 77. On March 1, 1989, the Marine Corps honorably discharged Schmidt with a 10% separations disability rating and severance pay. AR 18.[1]

         Such decisions, however, are not always final. A military secretary “may correct any military record”-including records related to separations-“when the [s]ecretary considers it necessary to correct an error or remove an injustice.” 10 U.S.C. § 1552(a)(1). A secretary makes such corrections through civilian boards for correction, established under procedures promulgated by the secretary. Id. § 1552(a)(1), (a)(3)(A). Relevant here, the Secretary of the Navy's Board for Correction of Naval Records “determin[es] the existence of error or injustice in the naval records of current and former members of the Navy and Marine Corps” and “take[s] corrective action on the Secretary's behalf when authorized.” 32 C.F.R. § 723.2(b). Also, the Board for Correction may reconsider its prior decisions in certain narrow circumstances: “After final adjudication, further consideration will be granted only upon presentation by the applicant of new and material evidence or other matter not previously considered by the Board.” Id. § 723.9. New evidence is “evidence not previously considered by the Board and not reasonably available to the applicant at the time of the previous application.” Id. To be material, evidence must be “likely to have a substantial effect on the outcome.” Id.

         Schmidt first availed himself of this review process when he submitted an application to the Board for Correction in 1990. AR 58. The application requested that the Board for Correction increase his 10% disability rating because the physical evaluation board's rating was “unjust” and his “medical evaluations were incomplete and unjust.” Id. In support, the application noted that the Department of Veterans Affairs (VA) had assigned him a 34% disability rating, “with an upgrade pending, effective date 04-01-89.” Id. The Board for Correction ultimately denied Schmidt's application in 1992, explaining that the higher VA rating was “insufficient to demonstrate that [Schmidt's] discharge from the Marine Corps was erroneous, because the VA, unlike the military departments, may assign disability ratings without regard to the issue of fitness for military service.” AR 39.

         Sixteen years later, in 2008, Schmidt asked the Board for Correction to reconsider its 1992 decision. AR 11-41; see also Def.'s Mot. at 3 n.1, Dkt. 33. Schmidt again challenged the physical evaluation board's 10% separations disability rating by pointing to the higher rating assigned by the VA. AR 14-16. He attached a 2007 VA letter showing that his total VA rating had increased to 100%, including a 70% disability rating for “major depressive disorder/PTSD, ” 40% for “degenerative arthritis of the spine, ” 30% for “hypertensive heart disease, ” and 10% for both clavicle/scapula impairment and “residuals of foot injury.” AR 17. According to Schmidt, “[t]o go from a 10% service-connected military medical discharge to a 100% service-connected VA disability evaluation offends common sense.” AR 15. The Board for Correction's Acting Executive Director rejected Schmidt's request for reconsideration, AR 7, but this decision was later set aside voluntarily and the request was remanded to the Correction Board for further consideration, AR 9-10.

         On remand, the Board for Correction denied Schmidt's request for reconsideration in 2011. AR 1-4. The Board for Correction stated that Schmidt's request was untimely and did not present new material evidence. Id. The Board therefore refused to reconsider its 1992 decision. AR 3.

         In 2014, Schmidt filed this action against the Secretary of the Navy, asserting that the Board for Correction's 2011 decision was arbitrary and capricious, unsupported by substantial evidence, and contrary to law. Compl. at 7, ¶¶ 2, 5, Dkt. 1.[2] The Court dismissed the action for lack of jurisdiction, Dkt. 19, but on appeal, the Secretary's counsel noted that the Court's decision may have conflicted with D.C. Circuit precedent. Therefore, the Secretary moved to vacate the Court's decision and remand for further proceedings, which the D.C. Circuit did in late 2016. See Dkt. 22-1; see also Schmidt v. Mabus, No. 15-5298 (D.C. Cir.), Doc. 1643066 (Secretary's motion), Doc. 1648618 (per curiam order). Following the remand, the Secretary moved for summary judgment in April 2017, Dkt. 33, and the case was reassigned to the undersigned judge on December 5, 2017.


         A court grants summary judgment if the moving party “shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986). A “material” fact is one with potential to change the substantive outcome of the litigation. See Liberty Lobby, 477 U.S. at 248; Holcomb v. Powell, 433 F.3d 889, 895 (D.C. Cir. 2006). A dispute is “genuine” if a reasonable jury could determine that the evidence warrants a verdict for the nonmoving party. See Liberty Lobby, 477 U.S. at 248; Holcomb, 433 F.3d at 895. When a plaintiff seeks review of an agency decision under the Administrative Procedure Act (APA), summary judgment “serves as the mechanism for deciding, as a matter of law, whether the agency action is supported by the administrative record and otherwise consistent with the APA standard of review.” Sierra Club v. Mainella, 459 F.Supp.2d 76, 90 (D.D.C. 2006). “[T]he entire case . . . is a question of law” and the district court “sits as an appellate tribunal.” Am. Biosci., Inc. v. Thompson, 269 F.3d 1077, 1083 (D.C. Cir. 2001) (quotation marks and footnote omitted).

         The APA requires courts to set aside agency decisions that are arbitrary and capricious, not in accordance with law, or unsupported by substantial evidence. 5 U.S.C. § 706(2).[3] When the agency decision was made by a military correction board, judicial review proceeds “under an ‘unusually deferential application of the arbitrary or capricious standard.'” Roberts v. United States, 741 F.3d 152, 158 (D.C. Cir. 2014) (quoting Kreis v. Sec'y of the Air Force, 866 F.2d 1508, 1514 (D.C. Cir. 1989)). This “unusual deference” arises from the statute permitting the Secretary of a military department-acting through correction boards-to correct military records “when the Secretary considers it necessary . . . .” 10 U.S.C. § 1552(a)(1); see also Roberts v. Harvey, 441 F.Supp.2d 111, 119 (D.D.C. 2006). Due to that language, “[i]t is simply more difficult to ...

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