Facts of the Case

After being exposed to asbestos while working for Ingalls Shipbuilding as a shipfitter, Jefferson Yates filed a claim for disability benefits under the Longshore and Harbor Workers' Compensation Act (LHWCA). While Ingalls and Yates settled, Yates also sued the manufacturers and suppliers of the asbestos products that were allegedly present in his workplace when he contracted asbestosis. Yates also settled with some of the manufacturers and suppliers he sued, each of whom required releases from Yates and his wife. Ingalls did not approve of any releases. When Yates died, his wife then filed for benefits under the LHWCA, which provides, "If the person entitled to compensation... enters into a settlement with a third person... for an amount less than the compensation to which the person... would be entitled under this [Act], the employer shall be liable for compensation only if written approval of the settlement is obtained from the employer before the settlement is executed." Ultimately, the Court of Appeals affirmed that at the time Mrs. Yates executed the predeath settlements, she was not a "person entitled to compensation" because her husband was still alive, thus her right to death benefits had not yet vested.

Question

Is an injured worker's spouse, who may be eligible to receive death benefits under the Longshore and Harbor Workers' Compensation Act after the worker dies, a "person entitled to compensation" when the spouse enters into a settlement agreement with a third party before the worker's death?

Conclusion

No. In a unanimous opinion delivered by Justice Sandra Day O'Connor, the Court held that before an injured worker's death, the worker's spouse is not a "person entitled to compensation" for death benefits and did not forfeit the right to collect death benefits under the LHWCA for failure to obtain the worker's employer's approval of settlements entered into by the worker's spouse with third parties before the worker's death. In a 7-2 decision, the Court held that rule 15(a) of the Federal Rules of Appellate Procedure, which provided that the "agency" had to be named respondent in an appeal of an order of a federal administrative agency or board to a Federal Court of Appeals, conferred upon the Director the right to appear as a respondent before the Courts of Appeals in appeals from final orders of the Benefits Review Board.