Cranford v. McDonough

Case: 21-1973    Document: 34     Page: 1   Filed: 12/19/2022




   United States Court of Appeals
       for the Federal Circuit
                  ______________________

                KRISTOPHER CRANFORD,
                    Claimant-Appellant

                             v.

       DENIS MCDONOUGH, SECRETARY OF
              VETERANS AFFAIRS,
               Respondent-Appellee
              ______________________

                        2021-1973
                  ______________________

     Appeal from the United States Court of Appeals for
 Veterans Claims in No. 19-6580, Judge Joseph L. Falvey,
 Jr.
                 ______________________

                Decided: December 19, 2022
                  ______________________

    KENNETH DOJAQUEZ, Carpenter Chartered, Topeka,
 KS, argued for claimant-appellant.

     KYLE SHANE BECKRICH, Commercial Litigation Branch,
 Civil Division, United States Department of Justice, Wash-
 ington, DC, argued for respondent-appellee. Also repre-
 sented by BRIAN M. BOYNTON, CLAUDIA BURKE, PATRICIA M.
 MCCARTHY; EVAN SCOTT GRANT, Y. KEN LEE, Office of Gen-
 eral Counsel, United States Department of Veterans Af-
 fairs, Washington, DC.
                   ______________________
Case: 21-1973     Document: 34     Page: 2    Filed: 12/19/2022




 2                                   CRANFORD   v. MCDONOUGH




     Before REYNA, HUGHES, and STOLL, Circuit Judges.
     Opinion for the court filed by Circuit Judge HUGHES.
      Concurring Opinion filed by Circuit Judge REYNA.
 HUGHES, Circuit Judge.
     Kristopher Cranford appeals a decision by the United
 States Court of Appeals for Veterans Claims affirming the
 denial of his request for benefits. Because Mr. Cranford is
 not a “veteran” entitled to receive benefits under 

(2), we affirm.
                               I
     Mr. Cranford is a former service member for the United
 States Army. In 2011, while on active duty, he was charged
 with possession and use of Spice, an unregulated intoxi-
 cant, in violation of a lawful general order. Captain Lucas
 Lease recommended that Mr. Cranford be tried by general
 court-martial and forwarded the charges to Lieutenant
 Colonel (LTC) Erick Sweet. Cranford v. McDonough,
 No. 19-6580, 

, at *1 (Vet. App. Mar. 2,
 2021). LTC Sweet received the charges and recommended
 that a pretrial investigating officer be appointed. 

     In response, Mr. Cranford submitted a request to be
 discharged in lieu of trial by court-martial. 

 In that doc-
 ument, Mr. Cranford stated that he “underst[oo]d that [he]
 may request discharge in lieu of trial by court-martial be-
 cause . . . [the] charges . . . against [him] under the Uni-
 form Code of Military Justice [(UCMJ)] . . . authorize the
 imposition of a bad conduct or dishonorable discharge.” 

 (final alteration in original). Mr. Cranford further admitted
 guilt for at least one of the charges and acknowledged that,
 by accepting a discharge in lieu of trial by general court-
 martial, he would instead qualify for an “other than honor-
 able” (OTH) discharge, potentially barring him from receiv-
 ing benefits. 

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 CRANFORD   v. MCDONOUGH                                     3



      Captain Lease and LTC Sweet recommended that Mr.
 Cranford’s request for discharge be approved. 

. The
 general court-martial convening authority agreed and or-
 dered that Mr. Cranford receive an OTH discharge in lieu
 of trial. 

 Mr. Cranford was then separated from service.
     Mr. Cranford later filed a request for benefits with a
 Veterans Affairs (VA) regional office. The regional office de-
 nied that request on the grounds that Mr. Cranford’s dis-
 charge status barred him from receiving benefits.
 Cranford, 

, at *2. Mr. Cranford then filed
 a Notice of Disagreement, to which the VA responded with
 a Statement of the Case affirming its prior determination.
 

     Mr. Cranford appealed the VA’s decision to the Board
 of Veterans’ Appeals. 

 The Board affirmed the denial of
 benefits based on Mr. Cranford’s OTH discharge, reasoning
 that Mr. Cranford had requested the OTH discharge to es-
 cape trial by general court-martial. Applying 

(d)(1), the Board concluded that Mr. Cranford had
 been discharged under dishonorable conditions and was
 thus ineligible for benefits as a non-veteran under
 

(2).
     Mr. Cranford appealed the Board’s decision to the Vet-
 erans Court, arguing that (1) the Board mischaracterized
 his discharge as being “in lieu of a general court-martial,”
 instead of a summary court-martial, Cranford,
 

, at *2 (emphasis added), and (2)
 § 3.12(d)(1) did not apply to him because he had accepted
 an OTH discharge, not an “undesirable discharge,” id.
     The Veterans Court rejected both arguments, reason-
 ing that (1) Mr. Cranford had been referred for a general
 court-martial, since he had acknowledged as much in his
 request for discharge, id. at *2–3, and (2) an OTH dis-
 charge accepted in lieu of a general court-martial is equiv-
 alent to an undesirable discharge—despite the military
 service departments’ shift in terminology, id. at *3–4
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 4                                  CRANFORD   v. MCDONOUGH



    Mr. Cranford appeals. We have jurisdiction under
 

.
                              II
     At issue in this appeal is whether the service depart-
 ments’ shift in terminology from “undesirable” to “OTH”
 discharge affects Mr. Cranford’s eligibility for benefits un-
 der 

(d)(1). 1 Under 

(a), we
 have jurisdiction to review the Veterans Court’s interpre-
 tation of that regulation. We review questions of statutory
 and regulatory interpretation de novo. Martinez-Bodon v.
 McDonough, 

, 1243 (Fed. Cir. 2022).
                              A
     

(2) defines a veteran as a “person who
 served . . . and who was discharged or released therefrom
 under conditions other than dishonorable.” The Secretary
 of the VA has the “authority to prescribe all rules and reg-
 ulations which are necessary or appropriate to carry out
 the laws administered by the department and are con-
 sistent with those laws.” 

(a). The nature of
 this rulemaking authority is “broad.” Snyder v.
 McDonough, 

, 1003 (Fed. Cir. 2021). Apart from
 certain statutory bars, the Secretary has discretion to de-
 fine what conditions fall outside “conditions other than dis-
 honorable,” and thus bar a former service member from
 receiving benefits. Garvey v. Wilkie, 

, 1340
 (Fed. Cir. 2020) (holding that “the VA has authority to de-
 fine the term [‘conditions other than dishonorable’] con-
 sistent with Congressional purpose.”).
     In promulgating 

(d), the Secretary of
 the VA used this broad rulemaking authority to define



     1  Mr. Cranford did not appeal the Veterans’ Court’s
 determination that he was facing a general court-martial
 when he accepted discharge.
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 CRANFORD   v. MCDONOUGH                                   5



 which discharges are issued under dishonorable condi-
 tions. See Character of Discharge, 

 (Mar. 26, 1976) (“The Veterans Administration is charged
 with the responsibility of determining whether such dis-
 charges were granted under conditions other than dishon-
 orable. The provisions of § 3.12(d) were established for the
 purpose of making such determinations.”). Under
 § 3.12(d)(1), one discharge issued under dishonorable con-
 ditions is “[a]cceptance of an undesirable discharge to es-
 cape trial by general court-martial.” 

 (Jan.
 4, 1963). The VA has understood § 3.12(d)(1) to bar service
 members who accepted discharges to avoid general court-
 martial from accessing benefits because such discharges
 are considered “dishonorable” and disqualify those individ-
 uals from the definition of “veteran” in 

(2).
 See Veterans Benefits: Character of Discharge, 

,936–37 (Dec. 5, 1975) (currently codified as 

) (discussing the relationship between § 3.12
 and the legislative bars to benefits, including 

(2)).
     At the time § 3.12(d)(1) was implemented, the service
 departments used five terms to describe categories of dis-
 charge, including “undesirable discharge.” 

; Major Bradley K. Jones, The Gravity of Adminis-
 trative Discharges: A Legal and Empirical Evaluation, 59
 MIL. L. REV. 1, 3 (1973) (citing Army Reg. No. 635-200,
 para. 1–5 (July 15, 1966)). In 1977, after the Vietnam War,
 the service departments stopped using the term “undesira-
 ble” to describe such discharges, opting instead to use the
 “OTH” descriptor to refer to the same class of individuals.
 Update and Clarify Regulatory Bars to Benefits Based on
 Character of Discharge, 

 (proposed July
 10, 2020).
     The VA did not update § 3.12(d)(1) at the time the ser-
 vice departments shifted terminology, and the regulation
 continues to use the old term. In 2020, the VA proposed to
 clarify § 3.12(d)(1) by replacing “undesirable discharge”
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 6                                     CRANFORD   v. MCDONOUGH



 with “other than honorable discharge or its equivalent.” 

,474–75. The stated purpose of this update was
 to “conform” to the current terminology used by the service
 departments. 

. The VA has not yet imple-
 mented its proposal.
                                B
      The only question before us is one of interpretation:
 whether those who accept an OTH discharge in lieu of trial
 by general court-martial are barred from receiving VA ben-
 efits based on the meaning of “undesirable discharge” in
 § 3.12(d)(1). 2, 3 When interpreting a regulation, we start by
 exhausting all traditional tools of interpretation to deter-
 mine whether the plain meaning of the regulation can be


     2    The concurrence would have us decide this case
 based on waiver alone. Concurring Op., 5–6. But we decline
 to do so here. The Veterans Court did not rely on waiver as
 a legal basis for its determination, and therefore, we lack
 jurisdiction to consider that issue. 

(a)
 (providing jurisdiction to review the Veterans Court’s deci-
 sion “on a rule of law or of any statute or regulation . . . that
 was relied on by the Court in making the decision” (empha-
 sis added)); see also, e.g., Carr v. Wilkie, 

,
 1176–77 (Fed. Cir. 2020) (declining to consider an issue
 that was not relied upon by the Veterans Court). In any
 case, the acknowledgment Mr. Cranford made when ac-
 cepting his request for discharge was that “he understood
 that if his request for discharge was accepted, he might be
 discharged under conditions other than honorable and
 that, as a result, he might be ineligible for VA benefits.”
 Cranford, 

, at *1 (emphasis added). We do
 not view this as an unequivocal waiver of benefits.
     3    Moreover, it is not for this court to decide, as a mat-
 ter of policy, whether veterans who accept an OTH dis-
 charge in lieu of general court-martial should receive VA
 benefits. That is a responsibility for Congress and the VA.
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 CRANFORD   v. MCDONOUGH                                      7



 discerned or whether it is truly ambiguous. Kisor v. Wilkie,
 

 (2019). Here, because we determine
 that the regulation is unambiguous on its face, we need not
 address any non-textual canons of interpretation. 

.
     That § 3.12(d)(1) applies to Mr. Cranford is clear “from
 the text, structure, history, and purpose” of § 3.12(d)(1). Id.
 The VA’s usage of the term “undesirable discharge” has not
 been rendered ambiguous or as having any interpretative
 doubt simply because the service departments have up-
 dated their terminology. See id.
     First, the VA’s recent proposed clarification of
 § 3.12(d)(1) confirms that “undesirable discharge” is unam-
 biguous. 

 (proposed July 10, 2020).
 Along with proposed substantive amendments to § 3.12,
 the VA’s proposal recognizes that “undesirable discharge”
 and “OTH discharge” have been understood as equivalents
 for over four decades. Id. (finding that replacing the term
 “undesirable discharge” with “a discharge under other than
 honorable conditions or its equivalent” will simply “con-
 form to the terminology that has been used since 1977.”).
 More than 70 comments were filed in response to the VA’s
 notice of proposal. 

 (Sept. 9, 2021).
 These comments did not protest that changing “undesira-
 ble” to “OTH” would somehow change the class of individ-
 uals to which it referred. To the contrary, while the
 commenters’ substantive objections varied, the comments
 reflected a general understanding that an OTH discharge
 is equivalent to an undesirable discharge. In other words,
 the definition of “undesirable discharge” was clear; the is-
 sue debated was whether those who fall within that defini-
 tion should be barred from receiving VA benefits.
     Second, the history of the term “undesirable discharge”
 further supports that the term is unambiguous. Although
 the VA determines whether a discharge bars an individual
 from receiving benefits, it is the service departments—not
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 8                                    CRANFORD   v. MCDONOUGH



 the VA—that provide the terms used for discharges. See 

,655–56 (Mar. 26, 1976) (acknowledging that
 the service departments are responsible for making the dis-
 charge determinations, and the VA is only responsible for
 deciding whether the given discharge disqualifies them
 from receiving benefits). Section 3.12(d)(1) was introduced
 at a time the service departments were still using the term
 “undesirable discharge” to describe a particular class of in-
 dividuals. See, e.g., 

(c) (1961); 

(n) (1967). At that time, the service departments de-
 fined “undesirable discharge” as “separation from the ser-
 vice ‘Under Conditions Other than Honorable.’” 

(c) (1961); see also 

(n) (1967) (defining
 the term as “[s]eparation from an Armed Force under con-
 ditions other than honorable”). It was in this context that
 the VA chose to use this same term in § 3.12(d)(1). In doing
 so, the VA understood “undesirable discharge” to describe
 the same class of individuals designated as “undesirable”
 by the service departments. See 

,655–56.
     When the service departments transitioned from the
 term “undesirable discharge” to “OTH discharge” in the
 1970’s, they did not change the class of individuals to which
 the terms refer. Compare 

(n) (1975) (defin-
 ing “Undesirable Discharge” as “[s]eparation from an
 Armed Force under conditions other than honorable”), with
 

(l) (1977) (“The three characterizations are:
 (1) Honorable, (2) Under Honorable Conditions (General
 Discharge), and (3) Under Other Than Honorable Condi-
 tions (Undesirable Discharge).”). See also, e.g., 

(b)(4)(i) (“An Other than Honorable (formerly unde-
 sirable) Discharge . . .”). The only change was the term the
 service departments used to refer to that class of individu-
 als. The class of individuals itself remained the same, as
 did the meaning of “undesirable discharge” in § 3.12(d)(1).
    Accordingly, all the available evidence points to the
 same unambiguous reading of § 3.12(d)(1): Mr. Cranford’s
 OTH discharge in lieu of trial by court-martial falls within
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 CRANFORD    v. MCDONOUGH                                   9



 the meaning of and is equivalent to an undesirable dis-
 charge.
                             III
     We have considered Mr. Cranford’s remaining argu-
 ments and find them unpersuasive. Because the plain
 meaning of § 3.12(d)(1), as implemented by the VA, has not
 changed, we affirm the Veterans Court’s decision to deny
 Mr. Cranford benefits.
                       AFFIRMED
                            COSTS
 No costs.
Case: 21-1973    Document: 34      Page: 10   Filed: 12/19/2022




    United States Court of Appeals
        for the Federal Circuit
                   ______________________

                KRISTOPHER CRANFORD,
                    Claimant-Appellant

                              v.

        DENIS MCDONOUGH, SECRETARY OF
               VETERANS AFFAIRS,
                Respondent-Appellee
               ______________________

                         2021-1973
                   ______________________

     Appeal from the United States Court of Appeals for
 Veterans Claims in No. 19-6580, Judge Joseph L. Falvey,
 Jr.
                 ______________________

 REYNA, Circuit Judge, concurring.
     The majority affirms a decision by the U.S. Court of
 Appeals for Veterans Claims affirming the denial of Cran-
 ford’s request for veterans’ benefits. For the following rea-
 sons, I concur only in the result reached.
                               I
     The Secretary has broad authority to prescribe rules
 and regulations that are necessary or appropriate to carry
 out the laws administered by the Department of Veterans
 Affairs (“VA”). See Snyder v. McDonough, 

,
 1003 (Fed. Cir. 2021); 

(a). Accordingly, the
 Secretary has the authority to determine the conditions
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 2                                  CRANFORD   v. MCDONOUGH



 under which individuals, other than those who receive dis-
 honorable discharges, might be precluded from receiving
 veterans’ benefits. See Camarena v. Brown, 

 (1994), aff’d, 

 (Fed. Cir. 1995).
     The issue presented in this appeal is whether the VA
 can deny benefits under 

(d)(1) where the
 servicemember receives a “discharge under other than hon-
 orable conditions” (“OTH discharge”) in lieu of a trial by
 general court-martial. Under that regulation, a service-
 member’s “[a]cceptance of an undesirable discharge to es-
 cape trial by general court-martial” is considered a
 dishonorable discharge, which thereby constitutes a bar to
 benefits. 

(d)(1) (emphasis added); see
 

(2).
     In the 1960s, a servicemember separating from service
 could be discharged under one of five discharge characteri-
 zations: honorable, general, undesirable, bad conduct, or
 dishonorable. J.A. 37. A servicemember facing trial by
 general court-martial could request a punitive administra-
 tive discharge (then-characterized as an undesirable dis-
 charge) as a plea bargain to avoid trial and the potential
 consequences of trial. See 

     This process of issuing punitive administrative dis-
 charges in lieu of trial by court-martial perpetuated the
 wrongful discrimination of minority servicemembers upon
 their return to civilian life. See General Accounting Office,
 FPCD-80-13, Military Discharge Policies and Practices Re-
 sult in Wide Disparities: Congressional Review Is Needed,
 at 71 (1980) (“Those most frequently given less than hon-
 orable discharges [we]re the less educated and minorities,
 who are already at a competitive disadvantage in the labor
 market.”). For example, servicemembers might have been
 fooled into requesting a quick discharge to skip trial when
 the punitive consequences would be more severe than what
 would have otherwise been imposed by a military court.
 See 

 (“In most cases a discharge in lieu of court-
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 CRANFORD   v. MCDONOUGH                                      3



 martial is not a bargain for the accused in the long run. . . .
 [M]ilitary courts were far more hesitant to impose a sen-
 tence which included a punitive discharge than were dis-
 charge authorities to approve discharges in lieu of court-
 martial. . . . [W]e question whether they understand its po-
 tential long-term consequences.”).
     In 1976, amidst growing awareness of the harms
 caused by discriminatory discharge practices, the Depart-
 ment of Defense (“DoD”) directed the service branches to
 cease issuing the “undesirable” discharge characterization
 altogether. See 

. The military complied with the
 directive, but it has continued to issue punitive adminis-
 trative discharges in lieu of trial by court-martial, and it
 has characterized those discharges as being issued “under
 other than honorable conditions.” See id.; Cranford v.
 McDonough, No. 19-6580, 

, at *3–4 (Vet.
 App. Mar. 2, 2021).
     Despite the change in DoD discharge policy,
 § 3.12(d)(1) was not amended to reflect the DoD directive.
 As a result, the regulation still employs the old characteri-
 zation term, “undesirable discharge,” instead of “discharge
 under other than honorable conditions.” See 

(d)(1). Based on this agency practice and Cranford’s
 acceptance of an OTH discharge in lieu of trial by court-
 martial, the VA denied Cranford benefits under
 § 3.12(d)(1), and the Board of Veterans’ Appeals (“Board”)
 and U.S. Court of Appeals for Veterans Claims (“Veterans
 Court”) affirmed. See Cranford, 

, at *3–4.
     On appeal, Cranford’s sole argument is that the Board
 and Veterans Court violated the plain language of
 § 3.12(d)(1) by barring him from receiving benefits as a re-
 sult of his acceptance of an OTH discharge in lieu of trial
 by general court-martial. Cranford insists that § 3.12(d)(1)
 applies only to discharges characterized as “undesirable,”
 which his was not. See Appellant’s Br. 6–12.
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 4                                    CRANFORD   v. MCDONOUGH



                               II
     I begin my review of § 3.12(d)(1) with the plain lan-
 guage of the regulation and the common meaning of the
 terms. See Aqua Prods., Inc. v. Matal, 

 (Fed. Cir. 2017) (en banc). Section 3.12(d)(1) provides that
 a discharge is considered to be issued under dishonorable
 conditions if it results from “acceptance of an undesirable
 discharge to escape trial by general court-martial.” See
 also 

(a) (providing that benefits are “not
 payable unless the period of service on which the claim is
 based was terminated by discharge or release under condi-
 tions other than dishonorable”).
     The Veterans Court determined that the purpose of
 § 3.12(d)(1) is to preclude benefits for those who accept any
 punitive administrative discharge in lieu of a trial by gen-
 eral court-martial. Therefore, according to the Veterans
 Court, the operative trigger of § 3.12(d)(1) depends only on
 the basis for discharge (in lieu of trial by general court-
 martial), not the servicemember’s characterization of ser-
 vice. See Cranford, 

, at *3.
      Neither the parties nor the Veterans Court have cited
 any legal authority demonstrating why that must be the
 case. Cranford only maintains that § 3.12(d)(1) does not
 apply to him because the military began using the term
 “other than honorable” in place of “undesirable” when issu-
 ing administrative discharges in lieu of court-martial, and
 the Secretary failed to timely update the language of the
 regulation. See Appellant’s Br. 5–6; Oral Arg. 10:30–35
 (“[Q:] You’re just making a technical argument, right?
 They changed the name, so it no longer applies? [A:] That’s
 correct, your Honor . . . .”). And the Secretary only recites
 the Veterans Court’s conclusions without explaining why
 the sole criterion for applying § 3.12(d)(1) should be the ba-
 sis for discharge. See Appellee’s Br. 6–7. In addition, the
 mere fact that the basis of discharge is distinguishable
 from the characterization of service does not explain why
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 CRANFORD   v. MCDONOUGH                                     5



 one criterion ought to be ignored for the other when both
 are expressed in § 3.12(d)(1).
      The majority fails to resolve these issues. The majority
 first explains that “the VA’s recent proposed clarification of
 § 3.12(d)(1) confirms that ‘undesirable discharge’ is unam-
 biguous.” Op. 7. But the fact that the proposal is still pend-
 ing, and necessary in the first place, indicates that
 § 3.12(d)(1) may not be unambiguous. Next, the majority
 reviews the regulatory history, Op. 7–8, but I do not think
 the history is clear enough on the current record to resolve
 the dispute.
     Further, the majority engages in interpretation, with
 the result of deciding policy concerning the scope of veter-
 ans’ benefits, when it is unnecessary to do so. See Guillory
 v. Shinseki, 

 (Fed. Cir. 2012) (declining
 to interpret a regulation where it was unnecessary to re-
 solve the appeal); see also Viale v. Wilkie, 

,
 845 n. 1 (Fed. Cir. 2018). I find this particularly concerning
 because the majority opinion results in a regulatory inter-
 pretation that precludes a veteran from receiving benefits,
 but the majority never mentions the pro-veteran canon.
 See Brown v. Gardner, 

 (1994) (“[I]nter-
 pretive doubt is to be resolved in the veteran’s favor.”); see
 also Hudgens v. McDonald, 

 (Fed. Cir.
 2016).
     Interpreting § 3.12(d)(1) is unnecessary here because
 Cranford does not dispute that he received notice of, and
 recognized, the consequences of his requested plea bar-
 gain—namely, an OTH discharge and a bar to veterans’
 benefits. See Appellant’s Br. (raising no argument that no-
 tice was inadequate); Oral Arg. 3:24–42 (acknowledging
 that Cranford received notice his request for discharge
 could result in a bar to benefits and that the issue of notice
 was not asserted on appeal). Nor does Cranford argue or
 demonstrate that he was forced into making a hasty or ill-
 informed decision. What Cranford ultimately seeks to
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 6                                   CRANFORD   v. MCDONOUGH



 obtain through this action is access to benefits that the rec-
 ord demonstrates he voluntarily relinquished. He cannot
 escape the fact that in 2011, he requested a plea bargain
 discharge to avoid trial by court-martial, and he acknowl-
 edged that acceptance of his request meant relinquishing
 future entitlement to veterans’ benefits. See Cranford,
 

, at *1; see also generally Munoz-Perez v.
 Shulkin, 

 (Fed. Cir. 2017) (dismissing an
 appeal of a denial of benefits under § 3.12(d)(1), based on
 an OTH discharge in lieu of trial by general court-martial,
 where the appellant failed to identify a due process issue
 by pointing to lack of notice or an opportunity to be heard).
 On this record, I cannot say that the Veterans Court erred
 in affirming the Board’s decision to deny Cranford benefits
 as a result of that plea bargain.
      Thus, while I agree with the majority’s ultimate con-
 clusion, I do not believe is it necessary, or prudent on this
 record, to resolve whether § 3.12(d)(1) applies to an OTH
 discharge. I would instead find that the VA properly de-
 nied benefits to Cranford under the terms of the plea bar-
 gain, in which he accepted the potential loss of benefits and
 a discharge under other than honorable conditions in lieu
 of trial by court-martial.