NATIONAL ORGANIZATION OF VETERANS ADVOCATES, INC. (NOVA) 1425 K St, NW, Suite 350 Washington, DC 20005 www.vetadvocates.

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March 22, 2013 FOR IMMEDIATE RELEASE Contact: Cathy Cuddy, Executive Coordinator Tel: (202) 587-5708 Email: ccuddy@vetadvocates.org

Federal Circuit Court of Appeals Upholds NOVA Position to Preserve Veterans Due Process Rights
Orders VA to Show Cause Why Sanctions Should Not Be Imposed on the Responsible Officials

Washington, D.C . The U.S. Court of Appeals for the Federal Circuit yesterday ruled in favor of the National Organization of Veterans Advocates, Inc. (NOVA) in its case against the Department of Veterans Affairs (VA) involving due process rights for military veterans before the agencys Board of Veterans Appeals (BVA). In its Order, the Federal Circuit confirmed that the VA acted unlawfully in 2011 when it promulgated a regulation that eliminated certain procedural and appellate rights for veterans appearing before the BVA. The Court also rebuked VA for failing to live up to its promise to stop enforcing its unlawful rule on March 5, 2012. In an extraordinary move, the Court ordered VA to show cause why sanctions should not be imposed for the failure to keep its word. As a result of VAs actions, a substantial number of cases may have been decided using an illegal rule that deprived veterans of critical due process rights, potentially costing those veterans the benefits they had earned. The Order called VAs conduct entirely unacceptable, highlighting its harmful effects on NOVA, its attorneys, the Court, and most importantly of all the veterans affected by the illegal rule. As the Order explained, [t]he unwarranted denial of benefits means real-world consequences to veterans. Promises of hypothetical relief do not pay for food or provide needed medical care. The Order went on to note that VAs conduct and written communications refute its assertions that its violations were unintentional, concluding that VA was well aware of [its] commitment and intentionally elected not to fulfill it.

The Order also made clear that the Court was considering imposing sanctions as a result of VAs conduct, and it required the agency to show cause why sanctions should not be imposed on the responsible officials. It noted that sanctions may be needed to motivate VA in the future to treat its commitments and representations to this court and opposing counsel with the seriousness to which they are entitled. The Court indicated that it will take VAs efforts to remedy the harm it has caused veterans into consideration when determining whether sanctions are appropriate. The Order grants VA sixty days in which to present a plan by which it will remedy any harm suffered by veterans as a result of its unlawful conduct. The Court emphasized that VA should confer with NOVA in developing its plan. Yesterdays ruling reaffirms NOVAs stance on preserving due process rights for veterans with hearings before the BVA. As Roman Martinez of Latham & Watkins LLP, NOVAs Counsel of Record in the case, stated: The Courts favorable decision is a big win for veterans. Its a testament to the principle that our government must keep faith with the brave men and women who have served their country in uniform. Over the course of more than a year, NOVA has sought to protect these critical due process rights and ensure that all veterans have the opportunity for a meaningful appeal, Martinez added. We are gratified that the Court has declared VAs conduct unlawful and is taking active steps to ensure that VA now remedies the harm it has inflicted on veterans. The rule change occurred on August 23, 2011, when VA promulgated a new regulation that exempted the BVA from certain due process procedures outlined in 38 C.F.R. 3.103, governing claimant hearings before the agency. VA made the new rule effective immediately, without the formal public comment period required by law. The resulting rule change stated that Section 3.103 rights would extend only to hearings conducted by the Agency of Original Jurisdiction (i.e., regional offices) and no longer apply to BVA hearings. Under Section 3.103, VA employees who conduct such hearings are required to fully explain the issues and suggest the submission of evidence that may have been overlooked by the claimant and could be advantageous to the claimants position. Also, VA is obligated to assist a claimant in assembling facts to support their claim. On September 9, 2011, NOVA filed a Petition for Review in the Court of Appeals for the Federal Circuit opposing the VAs denial of due process rights at BVA hearings. On behalf of NOVA, Mr. Martinez argued that the VAs rule failed to comply with the Adminis trative Procedure Act (APA) because it had been promulgated without the mandatory notice-andcomment procedure. VA originally intended to defend its regulation, but the Department of Justice concluded that NOVAs arguments were correct and refused to defend the August 2011 regulation in court.

VA then began the process of repealing the invalid rule in March 2012. When VA informed NOVA that it was repealing the invalid rule, it promised NOVA and the Court that the BVA would stop applying the rule on March 5, 2012, even before the repeal formally took effect. Despite this promise, the BVA continued to apply the rule. The repeal of the rule took effect on June 18, 2012. On November 7, 2012, Mr. Martinez urged the Federal Circuit at oral argument to hold that the repeal was retroactive to August 2011. He also asked the Court to hold VA accountable for its broken promise to cease applying the invalid rule in March 2012. Shortly thereafter, VA promulgated a Final Rule that accepted NOVAs position that the repeal of the rule should be retroactive to August 23, 2011, the date it was unlawfully promulgated in the first place. To view the Federal Circuit's Order in its entirety click here. About NOVA The National Organization of Veterans' Advocates is a not for profit educational membership organization incorporated in the District of Columbia in 1993. NOVA is a national organization of attorneys and other qualified members who act as advocates for disabled veterans. Our goal is to provide excellent representation before the U.S. Court of Appeals for Veterans Claims, the Board of Veterans Appeals, and the Department of Veterans Affairs, to veterans who have disability claims against the government resulting from their service as members of the armed forces. Offices are at 1425 K St NW, Suite 350, Washington, DC 20005. Phone: (202) 587- 5708, Fax: (202) 587- 5600, Email: ccuddy@vetadvocates.org. ###