A publication of Vietnam Veterans of America, Inc. ®
An organization chartered by the U.S. Congress

December 2001/January 2002

Veterans Benefits Update

Adult-onset Diabetes Added To The List

By Leonard J. Selfon, Director, Veterans Benefits Program

Following VVA’s petitions to the VA to amend its regulations to include adult-onset diabetes mellitus Type 2 as a presumptively service-connected disease as the result of exposure to Agent Orange and other herbicides (i.e., eligible for service connection without the need to submit medical evidence of a nexus between exposure and subsequent onset), the National Academy of Sciences’ Institute of Medicine (IOM) issued its findings on the subject. In its report, the IOM concluded that there is "limited/ suggestive evidence" of an association between exposure to herbicides that were used in Vietnam and adult-onset diabetes Type 2. Although the IOM did not find a clear linkage, the level of association found is sufficient to require the VA add diabetes to the presumptive list. Consequently, the VA, in January, 2001, published a proposed regulation that granted presumptive service connection for Type 2 diabetes. The regulation became final on July 9, 2001. Pursuant to the Agent Orange Act of 1991, the effective date of any award of benefits for a disorder that is added to the list of presumptively service-connected Agent Orange-related diseases will be the effective date of the VA regulation that does so. Consequently, the VA’s policy was to make any award of presumptive service connection for Type II diabetes effective as of July 9, 2001, regardless of whether the claimant had filed a claim for service connection prior to that date.

An exception to the effective date rule has been carved out a U.S. district court in California. In Nehmer v. U.S. Veterans Administration, C.A. No. C-86-6160 (THE) (N.D. Cal.), the Court held that the VA is required to provide retroactive benefits to certain claimants who filed claims for service connection for presumptively service-connected Agent Orange-related diseases before their respective implementing VA regulations were finalized. In December, 2000, the Nehmer court issued an order that required the VA to afford retroactive benefits for Type 2 diabetes awards, potentially as far back as the mid-1980s. As a result, the VA Compensation and Pension Service recently directed all VA claims adjudicators to follow the Nehmer rule. Essentially, if a veteran’s claim for service connection for diabetes Type 2 or a survivor’s claim for service connection for diabetes as the cause of the veteran’s death (Dependency or Indemnity Compensation or "DIC") was denied between September 25, 1985, and July 8, 2001, and a subsequent claim for the same benefit was granted after July 9, 2001, the effective date of the award of benefits should be the date that the earlier claim was filed , or the date that the disability arose or when death occurred, whichever is later. The earlier claim must have been for diabetes, but did not have to specifically reference exposure to herbicidal agents.

It is important to note that the VA has appealed the Nehmer court’s ruling to the U.S. Court of Appeals for the Ninth Circuit. Accordingly, all VA awards that grant retroactive benefits for diabetes Type 2 under the Nehmer order contain the following warning: "Payment for any period before July 9, 2001 may be subject to recovery by the VA in the event the United States Court of Appeal overturns the district court’s order." The warning goes on to state that recovery of such payment may include "the withholding of future benefit payments until the retroactive amount has been recovered in full."

Agent Orange Products Liability Suit Allowed to Proceed

On November 30, 2001, the U.S. Court of Appeals for the Second Circuit handed down a decision in the consolidated cases of two Vietnam veterans who are suing the manufacturers of Agent Orange in a civil action. Both veterans allege that they have suffered injuries as the result of being exposed to Agent Orange during the Vietnam war. Similar recent suits have been denied on the basis of the 1984 legal settlement of a class-action lawsuit against the same manufacturers. The original class action ended in a settlement and final judgment that established a fund to compensate class members that had been injured through exposure to Agent Orange during service, as well as certain persons whose injuries had not manifested as of the time of the settlement. The fund consisted of an agreed-upon finite dollar amount. By 1994, all monies from that fund had been disbursed. The settlement agreement prohibited the chemical manufacturers from being sued for products liability by any Vietnam veteran whose disability was not discovered prior to 1994. Since their injuries did not manifest themselves until after the settlement money had been depleted (post-1994), the two veterans in question filed their lawsuits in the late 1990s. In an April, 2000, decision, a U.S. District Court judge dismissed both lawsuits, finding that the veterans were legally precluded from suing the manufacturers at this late date.

In its November, 2000, decision, the Second Circuit Court of Appeals overturned the District Court judge’s dismissal. In so doing, the Court determined that because the veterans’ injuries had manifested after the settlement funds were exhausted, and because persons in this situation were not adequately represented in the earlier class action, they are not bound by the 1984 settlement. Consequently, the Court held that the current Agent Orange-related products liability lawsuits are not barred by that settlement. While the Court expressed no opinion as to the ultimate merits of the plaintiffs’ claims, its decision will at least allow them their day in court.

Agent Orange Products Liability Suit Allowed to Proceed

On November 30, the U.S. Court of Appeals for the Second Circuit handed down a decision in the consolidated cases of two Vietnam veterans who are suing the manufacturers of Agent Orange in a civil action. The veterans allege that they have suffered injuries as the result of being exposed to Agent Orange during the Vietnam War. Similar recent suits have been denied on the basis of the 1984 legal settlement of a class-action lawsuit against the same manufacturers.

The original class action ended in a settlement and final judgment that established a fund to compensate class members who had been injured through exposure to Agent Orange during service, as well as certain those whose injuries had not manifested as of the time of the settlement. The fund consisted of an agreed-upon finite dollar amount.

By 1994, all monies from that fund had been disbursed. The settlement agreement prohibited the chemical manufacturers from being sued for products liability by any Vietnam veteran whose disability was not discovered prior to 1994. Since their injuries did not manifest themselves until after the settlement money had been depleted (post-1994), the two veterans in question filed their lawsuits in the late 1990s. In an April 2000 decision, a U.S. District Court judge dismissed both lawsuits, finding that the veterans were legally precluded from suing the manufacturers at this late date.

In its November 2000 decision, the Second Circuit Court of Appeals overturned the District Court judge’s dismissal. In doing so, the Court determined that because the veterans’ injuries had manifested after the settlement funds were exhausted, and because those in this situation were not adequately represented in the earlier class action, they are not bound by the 1984 settlement. Consequently, the Court held that the current Agent Orange-related products liability lawsuits are not barred by that settlement. While the Court expressed no opinion as to the ultimate merits of the plaintiffs’ claims, its decision will at least allow them their day in court.

   

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