UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

MATTHEW W. STURM,

Plaintiff,

v. No. 24-cv-1298 (DLF) UNITED STATES DEPARTMENT OF DEFENSE,

Defendant.

MEMORANDUM OPINION

Matthew Sturm was medically separated from the United States Navy in 1998 with a

disability rating of 10%. While that rating entitled Sturm to severance pay, it fell short of the 30%

rating required to qualify him for medical retirement and certain lifetime benefits. In 2020, Sturm

submitted an application to the Board for Correction of Naval Records, requesting that the Board

increase his disability rating to 30% and medically retire him from the Navy. The Board denied

Sturm’s application. Sturm filed suit in this Court, challenging the Board’s decision under the

Administrative Procedure Act.

Before the Court is Sturm’s Motion for Summary Judgment, Dkt. 23, and the government’s

Cross-Motion for Summary Judgment, Dkt. 27. For the reasons that follow, the Court will deny

Sturm’s motion and grant the government’s motion. I. BACKGROUND

A. Legal Background

1. Navy Disability Evaluation System

The Secretary of the Navy may retire or separate a servicemember if the Secretary

determines that the member is “unfit to perform the duties of the member’s office, grade, rank, or

rating because of physical disability.”

(a), 1203(a); see Myles v. United States,

No. 21-1618C,

, at *6 (Fed. Cl. June 24, 2022) (“physical disability” may

include certain psychiatric and mood disorders). The unfit servicemember is given a disability

rating—a percentage rating that represents the extent to which the member’s medical conditions

render the member unfit. 10 U.S.C. § 1216a(b); see id. §§ 1201(b), 1203(b). If the servicemember

has fewer than 20 years of service, whether the member is retired or separated depends upon that

rating. See id. §§ 1201(b)(3), 1203(b)(4). If the Secretary finds that the member’s “disability is

at least 30 percent under the standard schedule of rating disabilities,” the member can qualify for

retirement. Id. § 1201(b)(3)(B). If the Secretary finds that the member’s disability falls below

that 30% threshold, the member may be separated from the Navy. See id. § 1203(a), (b)(4).

“[Servicemembers] who are separated are entitled only to severance pay, while [servicemembers]

who are retired receive, inter alia, lifetime retired pay, healthcare, and commissary privileges.”

Sissel v. Wormuth,

(D.C. Cir. 2023) (citation modified).

The Navy makes fitness and ratings determinations using a two-step process set forth in

the Navy’s Disability Evaluation System, as outlined in the Department of the Navy Disability

Evaluation Manual (SECNAVINST). See generally SECNAVINST 1850.4D.1 The first stage of

1 Citations are to SECNAVINST 1850.4D, the Department of the Navy Disability Evaluation Manual in effect at the time of Sturm’s medical evaluations and separation. Cf. Kelly v. United States,

, 889 n.1 (Fed. Cir. 2023).

2 the process is typically conducted by a Medical Evaluation Board (MEB), “which is convened if

a physician determines that a Navy member is unable to perform full military duty or unlikely to

be able to do so within a reasonable period of time.” Havens v. Mabus,

(D.C. Cir.

2024) (citation modified); see SECNAVINST 1850.4D §§ 3102, 3201.

If the Medical Evaluation Board finds a servicemember’s “[f]itness for continued active

service questionable by reason of physical or mental impairment,” the Board refers the member to

a Physical Evaluation Board (PEB). SECNAVINST 1850.4D § 3201(a). At the PEB stage, an

informal PEB first reviews the member’s record and issues preliminary findings regarding the

member’s fitness for duty, degree of disability, and entitlement to disability pay. Id. §§ 1004(b)–

(c), 3102(b). “If the member accepts the preliminary findings, the case is finalized and service

headquarters is requested to make an appropriate disposition (i.e., separate, retire or return to

duty).” Id. § 3102(b). If the member does not agree with the preliminary findings, the member

may request a hearing before a formal PEB. Id.; see id. § 1004(c). The formal PEB conducts a

hearing and makes recommended findings to the President of the PEB, who in turn issues a final

determination. Id. § 1004(f).

“The sole standard to be used in making determinations of physical disability as a basis for

retirement or separation is unfitness to perform the duties of the office, grade, rank or rating

because of disease or injury incurred or aggravated while entitled to basic pay.” Id. § 3301; see

id. § 4302. If the PEB determines that a member is unfit for duty based upon one or more

disabilities, the PEB must assign a compensable percentage disability rating for each unfitting

condition. See id. §§ 3801–3802. Percentage ratings are determined pursuant to the standards set

forth in the Department of Veterans Affairs’ (VA) Veterans Administration Schedule for Rating

3 Disabilities (VASRD), id. § 3801(b), and are “based on the severity of the condition(s),” id.

§ 3802(a).

As explained supra, the member’s disability rating determines the benefits and services to

which the member is entitled upon discharge.

2. Correction Board

A Navy servicemember who believes that his or her military record contains an “error” or

“injustice” may request that the Secretary of the Navy correct the record.

(a).

The Secretary issues such corrections through the Board for Correction of Naval Records

(Correction Board).

. The Correction Board “is not an investigative body.”

§ 723.2(b). Rather, “[i]ts function is to consider applications properly before it for the purpose of

determining the existence of error or injustice in the naval records of current and former members

of the Navy and Marine Corps, to make recommendations to the Secretary or to take corrective

action on the Secretary’s behalf when authorized.” Id. In performing this function, the Correction

Board “relies on a presumption of regularity to support the official actions of public officers and,

in the absence of substantial evidence to the contrary, will presume that they have properly

discharged their official duties.” Id. § 723.3(e)(2). The Correction Board “may deny an

application in executive session if it determines that the evidence of record fails to demonstrate

the existence of probable material error or injustice.” Id.

3. Post-2008 Application of the VASRD

In the National Defense Authorization Act (NDAA) for Fiscal Year 2008, Pub. L. No. 110-

181, § 1642,

, 465 (codified at 10 U.S.C. § 1216a), Congress enacted a new statutory

provision directing that the service branches “shall, to the extent feasible, utilize the schedule for

rating disabilities in use by the Department of Veterans Affairs” (i.e., the VASRD) and “may not

4 deviate from the schedule” unless doing so would result in a greater percentage of disability. At

the time, Department of Defense Instruction 1332.39 (DoDI 1332.39) adopted some—but not all—

of the ratings standards set forth in the VASRD. See DoDI 1332.39, Application of the Veterans

Administration Schedule for Rating Disabilities ¶ 4.2 (Nov. 14, 1996) (“[N]ot all the general policy

provisions in Sections 4.1–4.31 of the VASRD are applicable to the Military Departments. . . .

This Instruction replaces these sections of of [sic] the VASRD.”). As relevant here, DoDI 1332.39

provided that unfitting disability resulting from “Personality Disorder(s), Impulse Control

Disorders, or Substance Use and/or Abuse Disorder(s)” were non-compensable conditions that

should not be included in a servicemember’s disability rating, and instructed that a member’s

“overall rating of psychiatric impairment . . . be reduced to the impairment rating that would be

warranted in the absence of the influence of the non-compensable condition according to generally

accepted medical principles.” Id. ¶ 6.1. In response to the 2008 NDAA, the Department of

Defense issued a memorandum rescinding DoDI 1332.39. See generally DoD Policy

Memorandum on Implementing Disability-Related Provisions of the National Defense

Authorization Act of 2008 (Pub L. 110-181) (Oct. 14, 2008) (2008 DoD Policy Memorandum).

B. Factual and Procedural Background

1. Sturm’s Medical History and Evaluations

On February 2, 1987, Sturm enlisted in the Navy. A.R. 167. From 1989 to 1995, he served

onboard the USS LAKE CHAMPLAIN (CG 57) and the USS JASON (ARS 8), deploying four

times. A.R. 199. From 1995 to 1998, he was stationed at the Shipboard Intermediate Maintenance

Facility in San Diego, California. A.R. 199. In April 1998, he reported aboard the USS GARY

(FFG 51). A.R. 199.

5 On June 22, 1998, Sturm was admitted to the Naval Medical Center San Diego following

a suicide attempt involving an overdose of Motrin tablets. A.R. 73. He reported that he felt as

though “he [wa]s a bad father for having to leave his family and go to sea” and that “he d[id] not

feel that he [wa]s able to handle the rigors of sea duty” and was “concerned” regarding the

“upcoming change of [his] homeport to Japan” in light of his assignment to the USS GARY (FFG

51). A.R. 73. Sturm was diagnosed with Depressive Disorder Not Otherwise Specified and

“Avoidant/Dependent Personality Traits.” A.R. 208. Upon discharge, he was placed on limited

duty. A.R. 208. As part of that limited duty, he was precluded from taking part in both “shipboard”

and “overnight” work. A.R. 208.

On August 3, 1998, Sturm returned to the inpatient ward at the Naval Medical Center San

Diego, expressing suicidal ideation. See A.R. 32. The intake notes indicated that Sturm had

“experienced great dissatisfaction with his job in the Navy” and that the “stress” of his work

environment “appear[ed] to have contributed to a depressed mood.” A.R. 32. He was admitted

into the psychiatric unit for eight days. See A.R. 32. During that time, an MEB determined that

Sturm was “unable to perform further military duties” and referred him to a PEB for a fitness

determination. A.R. 35.

Sturm was discharged from the psychiatric unit on August 11, 1998. A.R. 32. Although

his “Initial Diagnostic Assessment” was “Adjustment Disorder with Mixed Anxiety and Depressed

Mood” along with “Avoidant Personality Features,” his “Discharge Diagnostic Assessment” was

“Depressive Disorder [Not Otherwise Specified]” and “Histrionic [and] Narcissistic Personality

Features.” A.R. 34–35.

Sturm was again psychiatrically hospitalized on November 12, 1998, “after expressing

homicidal ideation toward his senior chief.” A.R. 453; see A.R. 36. He was discharged on

6 November 20, 1998, with diagnoses of “Depressive Disorder [Not Otherwise Specified],”

“Anxiety Disorder [Not Otherwise Specified],” and “Personality Disorder Not Otherwise

Specified (Borderline, Narcissistic, and Passive-Aggressive Traits).” A.R. 39; see A.R. 36.

On January 11, 1999, Sturm received a psychiatric evaluation after reporting to the Naval

Medical Center San Diego following a “verbal altercation in a parking lot.” A.R. 454; see A.R.

230–32. He was discharged from emergency care the same day. A.R. 232.

On January 13, 1999, an informal PEB found Sturm fit for duty by a vote of 2-1. A.R. 19–

20, 454. The panel was comprised of one medical officer and two line officers. A.R. 454. The

medical officer considered Sturm unfit for duty due to “Depressive Disorder.” A.R. 454. The two

line officers, however, considered Sturm fit for service, with one noting that Sturm’s reported

condition was “simultaneous with going to sea and change of homeport to Japan.” A.R. 454.

Sturm learned of the PEB’s determination on January 19, 1999. See A.R. 238. That same

day, he reported to the Naval Medical Center San Diego, where he was psychiatrically hospitalized

until the following day. See A.R. 238, 240–41. His primary diagnosis was “Personality Disorder

Not Otherwise Specified,” “with Depressive Disorder [Not Otherwise Specified] and Anxiety

Disorder [Not Otherwise Specified] considered secondary.” A.R. 455; see A.R. 241.

Sturm sought reconsideration of the PEB’s findings, and, on February 24, 1999, the PEB

issued a decision finding Sturm unfit for service due to “Depressive Disorder [Not Otherwise

Specified].” A.R. 13. The PEB’s notes stated that Sturm was “a disciplinary problem,” “acting

out,” and “determined to NOT go back to sea.” A.R. 18. At the same time, however, the notes

acknowledged Sturm’s prior diagnoses of Depressive Disorder and Personality Disorder, though

they stated that there was a “strong question” whether Sturm was experiencing “‘real’ depression

or personality disorder.” A.R. 18 (citation modified). The PEB ultimately identified Sturm’s

7 Depressive Disorder Not Otherwise Specified as an unfitting condition and assigned it a 10%

disability rating. A.R. 13. It further found that Sturm’s Anxiety Disorder “contribute[d]” to his

Depressive Disorder and identified “Adjustment Disorder with Mixed Anxiety & Depressed

Mood” as a condition that “d[id] not constitute a physical disability.” A.R. 13 (citation modified).

Sturm accepted the PEB’s reconsidered findings on March 1, 1999, and waived a formal

hearing. See A.R. 15–16. The President of the PEB subsequently issued a final decision finding

Sturm unfit for service due to Depressive Disorder Not Otherwise Specified and assessing a 10%

disability rating. A.R. 7.

Sturm was medically discharged on March 25, 1999. A.R. 167–68.

After receiving the PEB’s 10% disability rating, Sturm submitted his medical records to

the VA in order to secure disability compensation benefits. See A.R. 243. On May 14, 1999, the

VA assigned Stum a 30% disability rating for “adjustment disorder with mixed anxiety and

depressed moods.” A.R. 248; see A.R. 248–49. In reaching this determination, the VA noted that

“[a]n evaluation of 30 percent is granted whenever there is occupational and social impairment

with occasional decrease in work efficiency and intermittent periods of inability to perform

occupational tasks (although generally functioning satisfactorily, with routine behavior, self-care,

and conversation normal), due to such symptoms as: depressed mood, anxiety, suspiciousness,

panic attacks (weekly or less often), chronic sleep impairment, mild memory loss (such as

forgetting names, directions, recent events).” A.R. 249.

2. Sturm’s Application to the Correction Board

In 2020, Sturm submitted an application to the Correction Board, requesting that the Board

increase his Navy disability rating to 30% and medically retire him from the Navy. A.R. 147, 152.

He argued that the PEB had violated 10 U.S.C. § 1216a by assessing a disability rating based on

8 the Navy’s “own, more stringent rating criteria,” rather than the criteria required by the VASRD,

resulting in a lower compensable disability rating than that calculated under the VASRD. A.R.

152. In particular, he argued that, rather than applying the VASRD criteria in rating his psychiatric

conditions—under which Sturm was entitled to a 30% disability rating if his condition caused

“occupational and social impairment with occasional decrease in work efficiency and intermittent

periods of inability to perform occupational tasks,” A.R. 249—the PEB applied an impermissibly

stringent standard requiring “proof of actual interference with job performance of such severity as

to result in a pattern of job loss, demotion, disqualification from obtaining employment, or inability

to engage in or maintain reasonable employment,” A.R. 161 (citation modified).

As part of its consideration of Sturm’s application, the Correction Board received two

advisory opinions. See A.R. 3, 76, 452–59. One of the advisory opinions—submitted by a Navy

psychiatric advisor—concluded that, while the VA’s “30% ‘overall rating of psychiatric

impairment’ was appropriate,” 20% of that overall rating was attributable to Personality Disorder

and Adjustment Disorder, which the advisory opinion characterized as “non-compensable

conditions.” A.R. 458. In support of this conclusion, the psychiatric advisor’s opinion noted that,

under SECNAVINST 1850.4D—in place at the time of Sturm’s PEB—not all medical conditions

contributed to a servicemember’s compensable percentage disability rating. See A.R. 457–58. In

particular, the opinion noted that SECNAVINST 1850.4D instructed that “[p]ersonality

disorder(s), impulse control disorders, or substance use and/or abuse disorder(s) [we]re examples

of conditions not constituting a physical disability” and that unfitting disability resulting from such

conditions was to be subtracted from a member’s “overall rating of physical impairment,” reducing

the overall rating “to the impairment rating that would be warranted in the absence of the influence

of the non-compensable condition according to generally accepted medical principles.” A.R. 458.

9 Applying SECNAVINST 1850.4D, the psychiatric advisor’s opinion concluded that Sturm’s 10%

disability rating was appropriate. A.R. 458. Because “[t]he complete record show[ed] Personality

Disorder was considered [Sturm’s] primary diagnosis,” it reasoned, Sturm’s “overall psychiatric

impairment [wa]s appropriately reduced to “a 10% rating for Depressive Disorder [Not Otherwise

Specified] under VASRD Diagnostic Code 9499-9435 and a 20% rating for non-compensable

Personality Disorder and Adjustment Disorder conditions.” A.R. 459.

In reaching this conclusion, the psychiatric advisor’s opinion acknowledged that, “[w]hen

it is not possible to separate the effects of the service-connected condition and the non-service-

connected condition, VA regulations . . . require that reasonable doubt on any issue be resolved in

the appellant’s favor” and “clearly dictate that such signs and symptoms be attributed to the

service-connected condition.” A.R. 458. In Sturm’s case, however, the psychiatric advisor’s

opinion concluded that “the record allow[ed] separation of the effects of compensable and non-

compensable conditions,” as demonstrated by the assignment of Personality Disorder as Sturm’s

“primary condition.” A.R. 458.

Finally, the psychiatric advisor’s opinion rejected Sturm’s argument that the PEB had

imposed an “impermissible rating standard for the 30% ratings threshold applicable to psychiatric

conditions,” concluding that “there [wa]s neither evidence for or against the PEB applying this

standard in its February 1999 adjudication.” A.R. 459.

On October 15, 2020, the Director for the Navy Council of Review Boards issued a letter

concurring with the psychiatric advisor’s opinion. A.R. 76. Like the psychiatric advisor’s opinion,

the Director’s opinion concluded that, “while Enclosure 9 of SECNAVINST 1850.4D imposed an

impermissibly high standard for the 30% rating threshold as applied to psychiatric conditions, there

[wa]s neither evidence for or against the PEB applying this standard in its February 1999

10 adjudication.” A.R. 76. “In fact,” the Director’s opinion noted, Sturm “had already

demonstrate[ed] problematic employment within the Navy, despite the problematic standard.”

A.R. 76. As such, the Director’s opinion concluded that “a 30% overall rating of psychiatric

impairment [wa]s reasonable.” A.R. 76. The opinion further concluded that, in light of Sturm’s

“primary” Personality Disorder diagnosis, that 30% overall rating was “appropriately reduced” to

10%. A.R. 76.

The Correction Board denied Sturm’s application on December 14, 2020. A.R. 3–4.2 In a

letter, the Board noted that it “substantially concurred with the advisory opinions in [Sturm’s]

case.” A.R. 4. In particular, “the Board agreed with the advisory opinions that [Sturm’s]

Depressive Disorder was properly rated at 10% since [his] personality and adjustment disorders

must be deducted from [his] VA assigned rating of 30%.” A.R. 4. In support of this conclusion,

the Board noted that Sturm’s “two most recent hospitalizations resulted in Personality and

Adjustment Disorder diagnoses” and that his “primary diagnosis from the VA was for Adjustment

Disorder vice Depressive Disorder,” which “formed the basis for [his] 30% disability rating.” A.R.

4. Because Sturm’s “depression symptoms were included in the overall 30% VA rating for

Adjustment Disorder,” the Correction Board concluded, “the preponderance of the evidence

support[ed] the PEB rating of 10% for [Sturm’s] Depressive Disorder.” A.R. 4. And, because

Sturm’s “Depressive Disorder did not separately qualify for a disability rating of 30% or greater,

the Board determined [Sturm] did not qualify for placement on the disability retirement list.” A.R.

4. As such, “the Board found insufficient evidence of error or injustice to warrant a change to

[Sturm’s] record.” A.R. 4.

2 Although the Correction Board concluded that Sturm had not filed his application “in a timely manner,” it “found it in the interest of justice to waive the statute of limitations and consider [Sturm’s] case on its merits.” A.R. 3.

11 3. Sturm’s Complaint

In May 2024, Sturm filed suit in this Court, challenging the Correction Board’s decision

under the Administrative Procedure Act (APA),

et seq. See Compl., Dkt. 1.

Sturm’s complaint alleges that “[t]he Board’s decision was arbitrary, capricious, unsupported by

substantial evidence, and contrary to law because the Board unlawfully deviated from the required

[VASRD] criteria and (instead) applied the [Navy’s] own, more stringent, rating criteria, that

resulted in a lower disability rating, in violation of

and 1216a.”

. Sturm

asks this Court to, inter alia, set aside the Correction Board’s decision under

(2)(A)

and order the Secretary of the Navy “to correct [his] military records to reflect the correct combined

disability rating to which he is entitled.”

. The parties cross-moved for summary judgment

on Sturm’s claims. See Pl.’s Mot. for Summ. J., Dkt. 23; Def.’s Opp’n & Cross-Mot. for Summ.

J., Dkt. 27.

II. LEGAL STANDARDS

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 Anderson v. Liberty Lobby, Inc.,

, 247–48 (1986). A “material”

fact is one with potential to change the substantive outcome of the litigation. See Liberty Lobby,

; Holcomb v. Powell,

(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,

; Holcomb,

.

In an APA case, 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,

(D.D.C. 2006).

12 The Court will “hold unlawful and set aside” agency action that is “arbitrary, capricious, an abuse

of discretion, or otherwise not in accordance with law,”

(2)(A), “without observance

of procedure required by law,”

§ 706(2)(D), or “unsupported by substantial evidence,” id.

§ 706(2)(E).

In an arbitrary and capricious challenge, the core question is whether the agency’s decision

was “the product of reasoned decisionmaking.” Motor Vehicle Mfrs. Ass’n of United States, Inc.

v. State Farm Mut. Auto. Ins. Co.,

(1983). In answering this question, the Court

“is not to substitute its judgment for that of the agency.”

. “Nevertheless, the agency must

examine the relevant data and articulate a satisfactory explanation for its action including a rational

connection between the facts found and the choice made.”

(citation modified). The Court, in

turn, “must consider whether the decision was based on a consideration of the relevant factors and

whether there has been a clear error of judgment.”

(citation modified).

“Under the substantial-evidence standard, a court looks to an existing administrative record

and asks whether it contains ‘sufficient evidence’ to support the agency’s factual determinations.”

Biestek v. Berryhill,

(2019) (citation modified) (quoting Consol. Edison Co. v.

NLRB,

(1938)). In this context, sufficient evidence “means—and means only—

‘such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.’”

at 103 (quoting Consol. Edison Co.,

). Indeed, “an agency decision may be

supported by substantial evidence even though a plausible alternative interpretation of the evidence

would support a contrary view.” Morall v. DEA,

(D.C. Cir. 2005) (citation

modified). The arbitrary and capricious standard of § 706(2)(A), however, is a “catchall” that

generally subsumes the “substantial evidence” standard of § 706(2)(E). Ass’n of Data Processing

13 Serv. Orgs., Inc. v. Bd. of Governors of Fed. Rsrv. Sys.,

, 683–84 (D.C. Cir. 1984);

accord Safe Extensions, Inc. v. FAA,

(D.C. Cir. 2007).

III. ANALYSIS

Sturm raises three arguments. First, Sturm argues that the Correction Board’s decision was

contrary to law because the Board (1) unlawfully followed a formally rescinded provision of DoDI

1332.39; and (2) upheld an unlawful deviation from the VASRD by applying a Navy policy that

resulted in a lesser disability rating. Second, Sturm contends that the Correction Board’s decision

was arbitrary and capricious because the Board failed to adequately articulate its reasoning.

Finally, Sturm asserts that the Correction Board’s decision was not supported by substantial

evidence because the Board ignored contrary record evidence.

The Court will address each argument in turn.

A. Forfeiture

At the outset, the government argues that the Court should “disregard” Sturm’s “assertion

that ‘the Board committed legal error’ by relying on the [SECNAVINST] 1850.4D’s direction that

a Medical Board and Physical Board can account for compensable and non-compensable

conditions,” Def.’s Opp’n & Cross-Mot. for Summ. J. 10 (quoting Pl.’s Mem. in Supp. of Mot. for

Summ. J. (Pl.’s Mem.) 19), because Sturm did not raise that argument in his application to the

Correction Board,

at 11 (citing A.R. 159–63). Sturm, for his part, contends that he did not have

an opportunity to raise the argument until the Correction Board erroneously applied

SECNAVINST 1850.4D to his application. See Pl.’s Reply & Opp’n at 4–5.

The Court agrees with Sturm. In his brief to the Correction Board, Sturm argued that the

PEB “violated 10 U.S.C. § 1216a” by providing him “with a disability rating based on its own,

more stringent, rating criteria instead of the required [VASRD].” A.R. 152. Before this Court,

14 Sturm argues that the Board repeated that error twice over—first by upholding the PEB’s unlawful

deviation from the VASRD and again by itself following the rescinded DoDI 1332.39. See Pl.’s

Mem. 18–22. Having clearly presented before the Correction Board the argument that the PEB

unlawfully deviated from the VASRD, Sturm was not required to identify preemptively the

universe of provisions with which the Board need comply to avoid the same alleged error. Put

differently, Sturm argued that the PEB—and, in turn, the Board—was legally obligated to apply

the disability rating criteria set forth in the VASRD; it was not until the Board itself deviated from

the VASRD that Sturm had an opportunity to object to that deviation. Cf. United States. v. L.A.

Tucker Truck Lines, Inc.,

(1952) (“[O]rderly procedure and good administration

require that objections to the proceedings of an administrative agency be made while it has

opportunity for correction in order to raise issues reviewable by the courts.”). As such, Sturm did

not forfeit his argument as to SECNAVINST 1850.4D.

B. Contrary to Law

Sturm argues that the Correction Board’s decision was contrary to law because the Board

(1) unlawfully applied a deviation from the VASRD based on a provision of SECNAVINST

1850.4D modeled after the rescinded DoDI 1332.39; and, correspondingly, (2) upheld an unlawful

deviation from the VASRD by applying a Navy policy—SECNAVINST 1850.4D—that resulted

in a lesser disability rating. Pl.’s Mem. 18–22. Both arguments fail.

1. SECNAVINST 1850.4D

Sturm asserts that the Correction Board unlawfully “applied a deviation from the VASRD

that was expressly banned by the [Department of Defense] in 2008 when it rescinded DoDI

1332.39.” Pl.’s Mem. 19. In particular, Sturm contends that the Board “committed legal error”

by “substantially concurring” with the advisory opinion’s application of SECNAVINST 1850.4D,

15 which required Sturm’s “overall rating of psychiatric impairment” to be “reduced to the

impairment rating that would be warranted in the absence of the influence of the non-compensable

condition.”

(citation modified). Because SECNAVINST 1850.4D “derived from” DoDI

1332.39, Sturm argues, application of SECNAVINST 1850.4D “became unlawful” once the

Department of Defense rescinded DoDI 1332.39 in 2008.

This argument ignores the basic principle that the Correction Board must apply the policies

and regulations in place at the time of the servicemember’s discharge. See Chambers v. United

States,

(Fed. Cir. 2005); Bee v. United States, No. 21-1970,

, at *5 n.4 (Fed. Cl. Aug. 23, 2024). Here, there is no dispute that SECNAVINST 1850.4D

was the Navy Disability Evaluation Manual in place at the time of Sturm’s medical evaluations

and discharge. As such, SECNAVINST 1850.4D was the manual applicable to the Correction

Board’s review of Sturm’s 1998 separation.

The 2008 recission of DoDI 1332.39 does not affect this analysis. To start, that recission

did not itself rescind SECNAVINST 1850.4D, which the Navy had previously cancelled and

replaced with SECNAVINST 1850.4E in 2002.3 Thus, the operative question is not whether

SECNAVINST 1850.4D, or any portion thereof, had been rescinded at the time of Sturm’s

Correction Board review. It had. Rather, the operative question is whether the Department of

Defense’s 2008 recission of DoDI 1332.39 prohibited the Correction Board from applying

SECNAVINST 1850.4D.

It did not. “Retroactivity is not favored in the law.” Bowen v. Georgetown Univ. Hosp.,

(1988). As such, “congressional enactments and administrative rules will not

be construed to have retroactive effect unless their language requires this result.”

Nothing in

3 SECNAVINST 1850.4F cancelled and replaced SECNAVINST 1850.4E in 2019.

16 the text of 10 U.S.C. § 1216a—which prompted the recission of DoDI 1332.39—indicates that

Congress intended the statutory provision to apply retroactively to all prior disability rating

determinations. Nor does anything in the 2008 Department of Defense policy memorandum

rescinding DoDI 1332.39 suggest the same. See 2008 DoD Policy Memorandum.4

This conclusion is bolstered by the fact that Congress in the 2008 NDAA also established

a specific correction board—the Physical Disability Board of Review (PDBR)—to “address the

disparities in the disability ratings issued by the military departments in the Department of Defense

and the VA” to a defined subset of servicemembers. Sissel,

(citation modified).

The PDBR is tasked with reviewing the disability determinations of servicemembers who, between

September 11, 2001, and December 31, 2009, were “separated from the armed forces due to

unfitness for duty due to a medical condition with a disability rating of 20 percent disabled or less”

and “found to be not eligible for retirement.” 10 U.S.C. § 1554a(b); see id. § 1554a(a); Coleman

v. Kendall,

, 613–14 (4th Cir. 2023) (describing the PDBR process as a “retroactive

review[]”). Department of Defense Instruction 6040.44 (DoDI 6040.44) guides the PDBR’s

review. In 2009, the Department of Defense revised DoDI 6040.44 to “expressly provid[e] that

DoDI 1332.39 does not apply to the [PDBR’s] review of a service member’s disability rating if

that service member was separated from the military prior to January 28, 2008.” Hatmaker v.

United States,

(2014) (citing DoDI 6040.44 encl. 3 ¶ 5.e.(1)). Today, DoDI

4 Sturm suggests that application of the 2008 Department of Defense policy memorandum—and its recission of DoDI 1332.39—to the Correction Board’s review would not be retroactive. See Pl.’s Reply & Opp’n 6–7. He bases that argument, in part, on the premise that application of the memorandum would not “impair the rights of, increase the liability of, or impose new legal consequences on the Government because the Board was already prohibited from applying DoDI 1332.39 in any review.” Id. at 6. That reasoning, however, merely assumes its conclusion. The very question before the Court is whether the Correction Board was prohibited from applying DoDI 1332.39 or Department of the Navy Disability Evaluation Manual provisions based thereon.

17 6040.44 instructs that “[t]he PDBR will conduct reviews of the disability rating(s) of the covered

individual in accordance with the VASRD in effect at the time of separation.” DoDI 6040.44 encl.

3 ¶ 4(f). It further specifies that “[a]ny [Department of Defense] provisions, Military Department

regulations, or guidelines inconsistent with the VASRD in effect at the time of the former Service

member’s separation will not be considered by the PDBR.” Id. encl. 3 ¶ 4(f)(2).

The PDBR is instructive in two ways. First, while the Department of Defense specifically

revised DoDI 6040.44 to clarify that DoDI 1332.39 does not apply to the PDBR’s review, Sturm

has pointed to no similar revisions to the guidance and policies governing military correction

boards. Second, if Congress had intended 10 U.S.C. § 1216a to apply to military correction boards’

review of all disability ratings, there would have been no need for Congress to establish a special

review board for a subset of discharged servicemembers. Section 1216a alone would have

sufficed.

Sturm’s counterarguments are unpersuasive.

First, Sturm argues that the 2008 memorandum rescinding DoDI 1332.39 makes clear that

“reliance on DoDI 1332.39 was improper and could not be used by the [Correction] Board moving

forward.” Pl.’s Reply & Opp’n 6; see Pl.’s Mem. 19. But nothing in the memorandum references

the Correction Board or purports to alter the Board’s practice of applying the policies and

regulations that were in place at the time of the servicemember’s discharge. See Chambers,

. Instead, in implementing the 2008 NDAA’s recission of DoDI 1332.39, the

memorandum revised policies and instructions guiding the initial disability evaluation process

itself. See 2008 DoD Policy Memorandum (revising DoDI 1332.18, Separation or Retirement for

Physical Disability (Nov. 4, 1996), and DoDI 1332.38, Physical Disability Evaluation (Nov. 14,

1996)). The memorandum thus does not suggest that it was the “settled expectation” that DoDI

18 1332.39 “could not factor into the [Correction] Board’s consideration.” Pl.’s Reply & Opp’n 6.

Contra

at 6–7.

Second, Sturm invokes DoDI 6040.44 and Hatmaker v. United States,

(2014), to argue that “DoDI 1332.39 does not apply to a Board’s review of a service member’s

disability rating if that service member was separated from the military prior to January 28, 2008.”

Pl.’s Reply & Opp’n 6 (citation modified) (quoting Hatmaker,

). But, as

explained, DoDI 6040.44 guides the PDBR’s review, not the Correction Board’s. And Hatmaker

involved review of a PDBR decision. See Hatmaker,

. As such, neither

authority is instructive here.

Finally, Sturm argues that, because “DoDI 1332.39 was never lawful” and “should not

have been implemented at the time of [Sturm’s] discharge, the Navy may not apply it now.” Pl.’s

Reply & Opp’n 7; see id. at 8 (“[A]pplying DoDI 1332.39’s unlawful deviations from the VASRD

to any service member’s record was wrong in 1999 and is wrong now.”). The Correction Board,

however, did not apply DoDI 1332.39 to its review of Sturm’s disability rating; it applied

SECNAVINST 1850.4D. True, Sturm argues that SECNAVINST 1850.4D “derived from DoDI

1332.39.” Pl.’s Mem. 19. But he nowhere argues that SECNAVINST 1850.4D was unlawful

when implemented. Indeed, he appears to contend that application of SECNAVINST 1850.4D

became unlawful only once DoDI 1332.39 was rescinded. See id.

In any event, this argument is forfeited. In his memorandum in support of his motion for

summary judgment, Sturm argued that the application of “DoDI 1332.39 (even as set forth in

SECNAVINST 1850.4D) became unlawful once the [Department of Defense] issued the 2008

DoD Disability Memo, and was expressly prohibited by DoDI 6040.44.” Id. (emphasis added).

He offered no argument that DoDI 1332.39 was unlawful ab initio. Rather, that argument appears

19 for the first time in Sturm’s combined reply and opposition. And, even then, Sturm provides no

explanation for his shift in position. Because Sturm failed to raise the argument in support of his

motion for summary judgment—and in light of the unexplained shift between Sturm’s conflicting

legal theories—the Court finds the argument forfeited. See Am. Wildlands v. Kempthorne,

(D.C. Cir. 2008) (arguments raised for the first time in reply are forfeited); Jones

Lang LaSalle Ams., Inc. v. NLRB,

(D.C. Cir. 2025) (“[A] litigant has an

obligation to spell out its arguments squarely and distinctly, or else forever hold its peace.”

(citation modified)).

2. Deviation Resulting in Lesser Disability Rating

Sturm further argues that the Correction Board “upheld an unlawful deviation from the

VASRD by applying Navy policy that resulted in a lesser [disability rating].” Pl.’s Mem. 20

(citation modified). In particular, Sturm contends that 10 U.S.C. § 1216a prohibits the Correction

Board from deviating from the VASRD unless “the utilization of such criteria will result in a

determination of a greater percentage of disability than would be otherwise determined through

the utilization of the schedule.” Id. (emphasis in original) (quoting 10 U.S.C. § 1216a). Here, he

argues that the Correction board failed to follow the VASRD because it did not (1) “rate mental

health disorders under the rating criteria of

.130”; or (2) adhere to

.102’s

requirement that reasonable doubt be resolved in his favor.

As to the first argument, Sturm contends that, in concluding that his Depressive Order did

not alone qualify for a disability rating of 30% or greater, the Correction Board applied a more

stringent standard than that set forth in

. See

at 20–21 (contrasting VASRD

standards for 10% and 30% disability ratings). In support of this argument, Sturm notes that the

VA provided him with a 30% disability rating, “analyzing the same record as the Board, without

20 subtracting for [his] allegedly non-compensable conditions.”

(emphasis in original); see

Pl.’s Reply & Opp’n 2 (“The VASRD only assigns a single disability rating for mental disorders.”

(emphasis in original)). Rather than follow

, he argues, the Correction Board

“applied the Navy’s own criteria as set forth in SECNAVINST 1850.4D, which applied the

rescinded DODI 1332.39 provision reducing the ‘overall rating of psychiatric impairment’ to

reflect the ‘impairment rating that would be warranted in the absence of the influence of the non-

compensable condition.’” Pl.’s Mem. 20 (quoting SECNAVINST 1850.4D, § 3802). That

reduction, he concludes, was legal error in violation of 10 U.S.C. § 1216a.

This argument fails for reasons already stated. Nothing in Section 1216a requires

retroactive application of the VASRD to all disability determinations made prior to the provision’s

enactment in 2008. As such, the Correction Board’s application of the instruction in effect at the

time of Sturm’s discharge—which required Sturm’s “overall rating of psychiatric impairment” to

be “reduced to the impairment rating that would be warranted in the absence of the influence of

the non-compensable condition,” SECNAVINST 1850.4D, § 3802(h)—did not constitute legal

error.

Sturm further argues that the Correction Board failed to adhere to

.102’s

requirement that “reasonable doubt” regarding degree of disability “be resolved in favor of the

claimant.”

; Pl.’s Mem. 21–22. In support of this argument, he asserts that the

advisory opinions on which the Correction Board relied failed to address his multiple depression

diagnoses and that the Board, in turn, simply accepted the opinions’ conclusion that Sturm’s record

allowed for “separation of the effects of compensable and non-compensable conditions.” Pl.’s

Reply & Opp’n 4; see Pl.’s Mem. 21–22.

21 The record undercuts Sturm’s argument. After engaging in a detailed review of Sturm’s

medical history, the psychiatric advisor’s opinion acknowledged that, when it is not possible to

separate compensable and non-compensable conditions,

“require[s] that

reasonable doubt on any issue be resolved in the [servicemember’s] favor.” A.R. 458. The opinion

concluded, however, that Sturm’s medical record “allow[ed] separation of the effects of

compensable and non-compensable conditions,” as reflected in the “assignment of the Personality

Disorder as the primary condition.” A.R. 458. The Board “substantially concurred” with that

conclusion, finding that “substantial evidence” supported the PEB’s 10% rating for Sturm’s

Depressive Disorder and 20% rating for his Personality and Adjustment Disorder diagnoses. A.R.

4; see Annicelli v. Kendall, No. 20-CV-02647,

, at *5 (D.D.C. Mar. 30, 2022)

(“Military corrections boards may meet their obligation to provide a ‘reasoned explanation’ for

their decisionmaking by referencing or incorporating the reasoning of an advisory opinion or other

sources.”); Roberts v. United States,

, 158–59 (D.C. Cir. 2014) (similar). Contrast,

e.g., Mittleider v. West,

(1998) (“In this case, there is no medical evidence

in the record separating the effects of the appellant’s service-connected PTSD from his personality

disorders.”).

Sturm does not explain how his “multiple depression diagnoses” give rise to reasonable

doubt regarding the separability of his compensable and non-compensable diagnoses. Pl.’s Mem.

22. True, “Sturm received depressive diagnoses at least four times.”

But diagnosis frequency

is distinct from diagnosis divisibility—the fact that Sturm was repeatedly diagnosed with

Depressive Disorder does not undermine the Correction Board’s conclusion that his Depressive

Disorder could be separated from his non-compensable conditions. As such, Sturm has not

identified any “reasonable doubt” to be resolved in his favor.

.

22 C. Arbitrary and Capricious

Sturm further argues that the Correction Board’s decision was arbitrary and capricious

because the Board “failed to adequately articulate”: “(1) how through anything other than

speculation, it was able to determine which of his mental health symptoms were attributable to

[his] Depressive Disorder NOS and which were attributable only to his non-compensable

conditions; (2) how it grappled with the fact that the VA, at the time of [his] discharge, had been

unable to separate his symptoms by conditions; (3) how [his] Adjustment Disorder and Personality

Disorder was cumulatively rated at 20%, and what percentage was attributable to each condition;

or (4) how a 10% rating for his Depressive Disorder was proper pursuant to

.”

Pl.’s Mem. 23.

The Correction Board provided a reasoned analysis of its determination that the

preponderance of the evidence supported the PEB’s reduction of Sturm’s overall disability rating.

The Board “substantially concurred” with the advisory opinions’ conclusion that Sturm’s

“Depressive Disorder was properly rated at 10%” in light of the fact that his “personality and

adjustment disorders must be deducted from [his] VA assigned rating of 30%.” A.R. 4. In

reaching this conclusion, the Board explained that Sturm’s “two most recent hospitalizations

resulted in Personality and Adjustment Disorder diagnoses,” and pointed out that Sturm’s “primary

diagnosis from the VA was for Adjustment Disorder vice Depressive Disorder.” A.R. 4; see A.R.

458 (“In the present matter, the record allows separation of the effects of compensable and non-

compensable conditions. This is most clearly established by Dr. Bennett’s assignment of the

Personality Disorder as the primary condition.”). Because that primary diagnosis formed the basis

of Sturm’s 30% disability rating—i.e., Sturm’s “depression symptoms were included in the overall

30% VA rating for Adjustment Disorder”—the Board “concluded that the preponderance of the

23 evidence support[ed] the PEB rating of 10% for [Sturm’s] Depressive Disorder.” A.R. 4. Put

differently, the Board’s reasoning, as reflected in the Board’s decision and the advisory opinions

on which it relied, proceeded as follows:

• The VA assigned Sturm a 30% disability rating. • That rating, however, accounted for all of Sturm’s psychological disorders, including Depressive Disorder, Adjustment Disorder, and Personality Disorder. • Only Depressive Disorder was a compensable condition. • When a servicemember’s compensable and noncompensable conditions are separable, SECNAVINST 1850.4D requires noncompensable conditions to be subtracted from the servicemember’s disability rating. • Sturm’s diagnoses were separable, and Depressive Disorder was not Sturm’s primary diagnosis, as evidenced by the fact that: (1) a psychiatrist previously assigned Personality Disorder as Sturm’s primary condition; (2) Sturm’s most recent hospitalizations resulted in Personality and Adjustment Disorder diagnoses; and (3) Sturm’s primary diagnosis from the VA was for Adjustment Disorder vice Depressive Disorder. • Thus, the preponderance of the evidence supported the PEB’s reduction of Sturm’s overall disability rating to account for only Sturm’s Depressive Disorder.

This analysis reflects “reasoned decisionmaking.” Haselwander v. McHugh,

(D.C. Cir. 2014) (citation modified). The Board “examine[d] the relevant data and

articulate[d] a satisfactory explanation,” drawing a “rational connection between the facts found

and the choice made.” State Farm,

(citation modified). Its reasoning was both

“reasonable and reasonably explained.” Nw. Corp. v. FERC,

(D.C. Cir.

2018). No more is required under the APA.

Sturm contests the Correction Board’s apportionment of the 30% disability rating amongst

his various conditions. See Pl.’s Mem. 22–25. This argument takes two forms. First, Sturm

appears to dispute the Correction Board’s determination that his conditions were separable.

Second, he argues that the Board did not provide a reasoned explanation for affirming the PEB’s

24 decision to assign his Depressive Disorder a 10% disability rating. Neither argument is ultimately

successful.

The Board adequately explained its finding that Sturm’s diagnoses were separable. After

conducting a thorough review of Sturm’s medical history, see A.R. 452–57, the psychiatric

advisor’s opinion detailed the manner in which each of Sturm’s three diagnoses manifested in his

behavior, see A.R. 458. The opinion then made a specific finding that Sturm’s medical record

“allow[ed] separation of the effects of [Sturm’s] compensable and noncompensable conditions,”

as reflected in a psychiatrist’s 1999 assignment of Personality Disorder as Sturm’s “primary

condition.” A.R. 458. The Correction Board was entitled to rely on the opinion’s conclusion that

Sturm’s “PEB record show[ed] specific contemplation of both the Depressive Disorder and

Personality Disorder” and that “[t]he complete record show[ed] Personality Disorder was

considered the primary diagnosis.” A.R. 459; see Roberts, 741 F.3d at 158–59.5 And it was

reasonable for the Correction Board to conclude that diagnoses that could be categorized into

primary and secondary conditions were also separable. Sturm has not identified a “clear error of

judgment” regarding that determination. State Farm,

.

Sturm next argues that the Board did not clearly explain the percentages attributable to

each of his conditions. The Court agrees. Although the Correction Board acknowledged that

5 Sturm disputes the Correction Board’s characterization of the VA’s diagnosis as “Adjustment Disorder vice Depressive Disorder,” A.R. 4, arguing that “the VA’s actual diagnosis was for ‘adjustment disorder with mixed anxiety and depressed moods,’ without any separation out of depression and anxiety from the overall diagnosis,” Pl.’s Mem. 24 (quoting A.R. 249). But the Correction Board’s decision elsewhere stated that the VA “assigned [Sturm] a 30% disability rating for Adjustment Disorder with mixed anxiety and depressed moods,” A.R. 4, suggesting that the Board did not perceive a difference between that formulation and “Adjustment Disorder vice Depressive Disorder.” Furthermore, the fact that the VA provided Sturm with a single rating for his psychiatric conditions does not, standing alone, indicate that those conditions were not separable, and Sturm does not point to anything in the VA’s report explicitly stating that the VA found that they were not.

25 Sturm had been diagnosed with Adjustment Disorder, Personality Disorder, and Depressive

Disorder, it provided Sturm with only two ratings: 10% for his Depressive Disorder, and 20% for

his remaining non-compensable conditions. A.R. 4. Furthermore, while the Board suggested that

Sturm’s Depressive Disorder was entitled to a lesser rating than his Adjustment Disorder, see A.R.

4 (noting that Sturm’s “primary diagnosis from the VA was for Adjustment Disorder vice

Depressive Disorder” (emphasis added)), it did not explain the basis of the percentage ratings for

each condition. As such, the Board neither specifically allocated percentage contributions to

Sturm’s Adjustment Disorder and Personality Disorder nor articulated why the preponderance of

the evidence supported the PEB’s 10% and 20% ratings.

Any error, however, was harmless. See Air Canada v. DOT,

, 1156 (D.C.

Cir. 1998) (“As incorporated into the APA, the harmless error rule requires the party asserting

error to demonstrate prejudice from the error.” (citing

)). The logical implication

of the Board’s determination that Sturm’s conditions were separable is that only a portion of

Sturm’s overall 30% disability rating is attributable to Sturm’s Depressive Disorder. And, if

Sturm’s disability rating for Depressive Disorder is less than 30%, that rating is not sufficient to

qualify Sturm for retirement. See

(b)(3)(B). As such, “it would be senseless to

vacate and remand for reconsideration,” PDK Labs., Inc. v. DEA,

(D.C. Cir.

2004)—any allocation of Sturm’s 30% disability rating among his three conditions will result in

the same determination that Sturm is not retirement eligible.

D. Substantial Evidence

Finally, Sturm contends that the Board’s decision was unsupported by substantial evidence

because it “ignored the numerous instances in which physicians diagnosed [Sturm] with

26 Depressive Disorder [Not Otherwise Specified] and assessed all of his behavior and symptoms as

depression-related.” Pl.’s Mem. 23.

For the reasons already stated, the Correction Board’s decision was supported by

substantial evidence. See Ass’n of Data Processing Serv. Orgs., 745 F.2d at 683–84 (“When the

arbitrary or capricious standard is performing that function of assuring factual support, there is no

substantive difference between what it requires and what would be required by the substantial

evidence test, since it is impossible to conceive of a ‘nonarbitrary’ factual judgment supported

only by evidence that is not substantial in the APA sense.”). Sturm’s medical record indicates that

a psychiatrist previously assigned Personality Disorder as Sturm’s primary condition, that Sturm’s

most recent hospitalizations resulted in Personality and Adjustment Disorder diagnoses, and that

Sturm’s primary diagnosis from the VA was for Adjustment Disorder vice Depressive Disorder.

See A.R. 4, 241, 248–49, 453–59. This evidence was sufficient to support the Correction Board’s

determination that Sturm’s conditions were separable and that only a portion of his overall 30%

disability rating was attributable to his Depressive Disorder. See Biestek, 587 U.S. at 102–03.

In response, Sturm points to record evidence indicating that he was “diagnosed with

depressive disorders at least four times.” Pl.’s Mem. 24; see

at 24–25. This evidence, he argues,

“stands in contrast to the few cherrypicked items cited by the Board.” Id. at 24. It is not clear

whether Sturm points to evidence of his prior diagnoses to contradict the Correction Board’s

separability determination, allocation determination, or both. In any event, the evidence is

unpersuasive. The fact that Sturm was repeatedly diagnosed with Depressive Disorder does not,

without more, undermine the Correction Board’s finding that Sturm’s conditions were separable.

See Morall,

(“[A]n agency decision may be supported by substantial evidence

even though a plausible alternative interpretation of the evidence would support a contrary view.”).

27 And, to the extent that Sturm challenges the disability rating attributable to his Depressive

Disorder, any error associated with that attribution is harmless. See supra.

CONCLUSION

For the foregoing reasons, the Court denies Sturm’s Motion for Summary Judgment, Dkt.

23, and grants the government’s Cross-Motion for Summary Judgment, Dkt. 27. A separate order

consistent with this decision accompanies this memorandum opinion.

________________________ DABNEY L. FRIEDRICH United States District Judge September 30, 2025

28