U.S. Merit Systems Protection Board 
Case Report forJanuary 17, 2014

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Note:  These summaries are descriptions prepared by individual MSPB employees. They do not represent official summaries approved by the Board itself, and are not intended to provide legal counsel or to be cited as legal authority.  Instead, they are provided only to inform and help the public locate Board precedents.

BOARD DECISIONS

Appellant:  Wandra Simmons
Agency:  Department of Housing and Urban Development
Decision Number:  2014 MSPB 1
Docket Number:  DC-0752-12-0784-I-1
Issuance Date:  January 6, 2014
Appeal Type:  Adverse Action by Agency
Action Type:  Constructive Adverse Action

Jurisdiction - Cancellation of Promotion
 - Reduction in Grade or Pay
Constitutional Issues - Due Process

    The agency petitioned for review of an initial decision that reversed the appellant's reduction grade and pay on due process grounds.  Effective July 18, 2010, the agency promoted the appellant from her GS-14 position with the Department of Justice to a GS-15 position with the Department of Housing & Urban Development.  In June 2011, the agency determined that the noncompetitive appointment to the GS-15 position was improper, and transferred the appellant to a GS-14 position retroactive to the initial date of her appointment to the GS-15 position.  On appeal to the Board, the administrative judge found jurisdiction as a reduction in pay and reversed the agency's action on due process grounds.  

Holdings:  The Board denied the agency's petition for review and reversed the agency's action, ordering the agency to restore her to the GS-15 position to which she had been promoted:

1. To establish Board jurisdiction over the cancellation of a promotion or appointment, an appellant must show that:  (1) the promotion was approved by an authorized official; (2) the appellant took some action denoting acceptance of the promotion or appointment; and (3) the promotion or appointment was not revoked before the appellant performed in the position.  It was undisupted that that these requirements were satisfied.

2. Notwithstanding the above, a reduction grade or pay that is to correct a classification error or pay-setting error that is contrary to law or regulation is not appealable to the Board.

3. The agency selected the appellant for a position that was properly graded as a GS-15 position, and the appellant performed GS-15 level work.  Any error in noncompetitively promoting the appellant was in the hiring process, and the agency's action to correct such error by retroactively cancelling the appellant's promotion and placing her in a different GS-14 position is an appealable reduction grade and pay.  The agency's action was not simply a correction of the employee's rate of basic pay within the meaning of 5 C.F.R. 752.401(b)(15).  

4. It was undisputed that the agency did not give the appellant notice of the proposed action or an opportunity to respond.  Reversal on due process grounds is therefore appropriate.  


Appellant:  Lwanda Okello
Agency:  Office of Personnel Management
Decision Number:  2014 MSPB 2
Docket Number:  SF-0845-12-0702-I-1
Issuance Date:  January 16, 2014
Appeal Type:  FERS - Collection of Overpayment - Debts
Action Type:  Retirement/Benefit Matter

Jurisdiction - Final OPM Decision
Annuity Overpayment

    The appellant petitioned for review of an initial decision dismissing his appeal concerning an alleged overpayment of annuity benefits for lack of jurisdiction.  This case has a long and complicated history involving several different OPM decisions and several Board appeals over the course of more than 6 years.  The appellant has been trying unsuccessfully throughout that period for a determination of whether he is indebted to the federal government for an overpayment of annuity benefits, but OPM has failed to issue a final decision.  

Holdings:  The Board granted the appellant's petition for review, vacated the initial decision, and remanded the case to the regional office for adjudication of the merits:

1. The Board has jurisdiction to review an administrative action or order affecting the rights or interests of an individual under the federal retirement laws.

2. Ordinarily, the Board only has jurisdiction to review a retirement matter after OPM issues a reconsideration decision under 5 C.F.R. 841.306, or issues an initial decision without reconsideration rights under 5 C.F.R. 841.307.  The Board will also take jurisdiction over an appeal concerning a retirement matter when OPM has refused or improperly failed to issue a final decision.  

3. The Board found that OPM had refused or improperly failed to issue a final decision.  It has been more than 6 years since OPM first determined that the appellant had received an annuity overpayment.  The appellant has diligently sought a final decision from OPM throughout that period, but to no avail.  Although OPM has represented that it still intends to issue a final decision, the Board has little confidence that OPM will follow through with its stated intention.  The appellant has a right to have this case adjudicated under the law, and a dismissal at this stage could effectively prevent him from obtaining an adjudication.  



Appellant:  Jerry Edward Beck
Agency:  Department of the Navy
Decision Number:  2014 MSPB 3
Docket Number:  DC-4324-13-0128-I-1
Issuance Date:  January 16, 2014
Appeal Type:  Uniformed Services Employment and Reemployment Rights Act (USERRA)

Veterans' Rights/USERRA - Discrimination Claim

    The appellant petitioned for review of an initial decision that dismissed his USERRA appeal for lack of jurisdiction.  The appellant, a Navy Veteran who had previously been employed as a Deputy Protocol Officer, applied for a position as a GS-13 Event Forum Project Chief, but was not selected.  In his USERRA appeal, he alleged that the selecting official made derogatory statements to him concerning his enlisted status in the U.S. Armed Forces.  The appellant further alleged that the selecting official selected a civilian candidate for the position even though the appellant was a disabled veteran and more qualified than the selectee.  In dismissing the appeal for lack of jurisdiction, the administrative judge found that the appellant's contention that the selecting official had spoken disparagingly of his prior military rank, even if true, could not be reasonably interpreted as a nonfrivolous allegation that he had lost of a benefit of employment due to his membership or performance of services in the uniformed service.  

Holdings:  The Board granted the appellant's petition for review, reversed the initial decision, and remanded the case to the regional office for adjudication on the merits:

1. The nondiscrimination provision of USERRA, 38 U.S.C. 4311(a), provides that a "person who . . . has performed . . . in a uniformed service shall not be denied initial employment, reemployment, retention in employment, or any benefit of employment on the basis of that . . . performance of service."  

2. The Board has adopted, and the Federal Circuit has endorsed, a "liberal approach in determining whether jurisdiction exists under USERRA."  In order to establish jurisdiction, the appellant need only allege that (1) he served in the military, (2) he was denied initial employment, reemployment, retention in employment, promotion, or a benefit of employment, and (3) the denial was due to his service in the military.  The relative weakness of the specific factual allegations initially made by an appellant in his USERRA claim should not serve as the basis for dismissing the appeal for lack of jurisdiction.

3. Here, it is undisputed that the appellant is a veteran and was not selected for the Event Forum Project Chief position, and he alleged that his nonselection was due to his prior military service and that his qualifications were superior to the selectee, who was a nonveteran.  This allegation is sufficient to establish jurisdiction under the Board's liberal pleading standard for USERRA claims.  Furthermore, the Board has recently held that, contrary to the initial decision, USERRA prohibits discrimination based not only on the fact of military service but also on the particulars of that service.  

4. Because the appellant has established Board jurisdiction over his USERRA claim, he is entitled to the hearing he requested.  


Appellant:  Robert Kavaliauskas
Agency:  Department of the Treasury
Decision Number:  2014 MSPB 4
Docket Number:  CH-0752-13-0435-I-1
Issuance Date:  January 16, 2014
Appeal Type:  Adverse Action by Agency
Action Type:  Removal

Collateral Estoppel
Judicial Estoppel

    This case was before the Board based on the administrative judge's order certifying an interlocutory appeal of her determination that the appellant was collaterally and judicially estopped from challenging the charge that formed the basis of his removal from employment.  The agency removed the appellant from his position as an internal revenue agent for improperly accessing taxpayer data without official reason to do so.  Prior to his removal, the appellant entered into an agreement with the U.S. Attorneys' Office for pretrial diversion of the potential charge of unauthorized use of a government computer in violation of 18 U.S.C. 1030(a)(2)(B).  Under the agreement, the appellant "accept[ed] responsibility for [his] behavior."  Prosecution was deferred for 18 months, provided the appellant complied with the terms of the agreement.  The appellant was released from the pretrial diversion program 5 months early, and he was never prosecuted for any crime in connection with the charged conduct.  The administrative judge found that the appellant was prohibited from challenging the occurrence of the misconduct underlying his removal because of his entry into the pretrial diversion program.  

Holdings:  The Board reversed the administrative judge's ruling, vacated the order that stayed the processing of the appeal, and returned the case to the regional office for further adjudication:

1. The appellant is not barred by collateral estoppel from litigating the facts underlying his pretrial diversion agreement.

a. The purpose of collateral estoppel is to relieve parties of the costs and vexation of multiple lawsuits, conserve judicial resources, and, by preventing inconsistent decisions, encourage reliance on adjudication.  One of the prerequisites for collateral estoppel to apply is that the issue was actually litigated in the prior action.  

b. The "actually litigated" element is satisfied when the issue was properly raised by the pleadings, was submitted for determination, and was determined.  A conviction based on a guilty plea meets this requirement.  

c. The appellant did not enter a guilty plea, but rather accepted responsibility for his behavior in the pretrial diversion agreement.  The Board did not agree with the judge's conclusion that signing the pretrial diversion agreement was equivalent to entering a guilty plea for purposes of determining whether the underlying conduct was actually litigated.  Neither party intended for the appellant's admission of responsibility to be an admission of guilt with consent that judgment be entered against him.  

d. Because the "actually litigated" element of the test for collateral estoppel has not been met, the appellant is not precluded from denying that he improperly accessed taxpayer data without official reason to do so.  

2. The appellant is not barred by judicial estoppel from litigating the facts underlying his pretrial diversion agreement.

a. Judicial estoppel preserves the integrity of the judicial process by precluding a party from contradicting a tribunal's determination in another proceeding when the determination was based on the position taken by the party in that case.  

b. Where a prior action was settled, judicial estoppel does not bar parties from later taking inconsistent positions to those asserted in the prior action.  The purpose of judicial estoppel, to preserve the integrity of the courts, is not implicated when the action ends in settlement without a disposition by the court because there is no judicial acceptance of the party's prior position.

c. The pretrial diversion agreement is akin to a settlement, and judicial estoppel therefore does not apply.



Appellant:  James Schnedar
Agency:  Department of the Air Force
Decision Number:  2014 MSPB 5
Docket Number:  DE-0752-11-0343-B-1
Issuance Date:  January 16, 2014
Appeal Type:  Adverse Action by Agency
Action Type:  Suspension - Indefinite

Harmful Procedural Error - Violation of Agency Procedures
Indefinite Suspension - Revocation of Eligibility for Access to Classified Information

    The appellant petitioned for review of a remand initial decision that sustained the agency's indefinite suspension.  The appellant was formerly employed as an Information Technology Specialist, a position that required that he obtain and maintain a security clearance.  In December 2009, the agency's Central Adjudication Facility (AFCAF) notified the appellant of its intent to revoke his eligibility for access to classified information.  Following the appellant's timely response, AFCAF notified him of its final decision to revoke his eligibility for access to classified information.  The notice informed the appellant of his right to appeal the revocation to the Personnel Security Appeals Board (PSAB).  In October 2010, the agency proposed to remove the appellant based on the revocation of his security clearance.  In response, the appellant noted that he was in the process of appealing the revocation to the PSAB, with a hearing scheduled before an Administrative Judge.  On March 16, 2011, the agency issued a decision mitigating the removal penalty to an indefinite suspension beginning March 27, 2011, and ending upon either a favorable decision by PSAB or an unfavorable decision and any resulting administrative action.  The appellant filed a timely appeal of his indefinite suspension.  In a previous decision, 119 M.S.P.R. 246 (2013), the Board vacated an initial decision affirming the indefinite suspension, and remanded for a determination whether the agency had complied with its own procedures in effecting the indefinite suspension, and if it did not, whether this constituted harmful procedural error under 5 U.S.C. 7701(c)(2)(A).  On remand, the administrative judge found that the agency regulation in question was inapplicable, and that, even if the agency had committed procedural error by suspending the appellant prior to his receipt of the PSAB decision, he was not harmed by the error.  

Holdings:  The Board granted the appellant's petition for review, reversed the initial decision, and did not sustain the indefinite suspension:

1. It was undisputed that the appellant's position required a security clearance, that this clearance was revoked, and that the agency provided the procedural protections required by the statute.  Section 7513 is not the only source of procedural protections in adverse actions, however.  Agencies must also comply with the procedures set forth in their own regulations.

2. Under the agency's regulations, it may not take an adverse action, including an indefinite suspension, if the employee concerned has filed an appeal with PSAB and is awaiting a written decision on that appeal.  It is undisputed that, at the time the agency effected an indefinite suspension against the appellant, his appeal to the PSAB was still pending.  

3. That the regulation states that it "is intended to provide guidance for the internal operation of the Department of Defense and . . . does not . . . create or enlarge the jurisdiction or review authority of any court or administrative tribunal, including the Merit Systems Protection Board," does not make compliance with the regulation legally irrelevant.  The Board's authority to review whether the agency complied with its regulations derives from it preexisting obligation under 5 U.S.C. 7701(c)(2)(A), and does not stand in need of creation or enlargement.  To the extent the regulation may purport to restrict that authority, the Board does not follow it, as the agency is without authority to relieve the Board of its statutory obligations.  

4. The agency's error was plainly harmful, for if the agency had complied with its regulations it would not have placed the appellant in a non-pay status on March 27, 2011, but would have awaited his receipt of the final decision from PSAB before taking any adverse action.  



COURT DECISIONS

Petitioner:  Amy J. Mitchell
Respondent:  Merit Systems Protection Board
Tribunal:  U.S. Court of Appeals for the Federal Circuit
Docket Number:  2013-3056
Issuance Date:  January 15, 2014

Jurisdiction - "Employee" - Whether Employment was Temporary

    The issue in this case was whether Ms. Mitchell was an "employee" within the meaning of 5 U.S.C. 7511.  The Merit Systems Protection Board had answered this question in the negative.  On December 21, 2008, Ms. Mitchell was hired as an Assistant U.S. Attorney.  Her SF 50-B provided that her appointment was not to exceed 18 months, was "temporary," and was "subject to" the successful completion of a pending backgound investigation.  Ms. Mitchell's background check was completed in late July 2009, and in early August 2009 she was provided another SF 50-B which stated that she was subject to a two-year trial period.  Ms. Mitchell was terminated on July 29, 2011, days before her two-year trial period ended.  Whether the Board had jurisdiction over this termination as a removal depended on whether Ms. Mitchell was an "employee" within the meaning of section 7511(a)(1)(C)(ii), i.e., "an individual in the excepted service  . . . who has completed 2 years of current continuous service in the same or similar positions in an Executive agency under other than a temporary appointment limited to 2 years or less."  As applied to this case, the question was whether the time during which Ms. Mitchell's background check was pending (approximately 7 months) counted towards the required 2 years of current continued service.  

Holdings: A majority of the court, Judge Prost dissenting, held that Ms. Mitchell was an "employee" under section 7511(a) and had the right to contest her removal at the Board:

1. A court must give effect, if possible, to every clause and word of the statute, avoiding, if it may be, any construction which implies that the legislature was ignorant of the meaning of the language it employed.  That principle counsels against reading "temporary" to have no meaning beyond "limited in time" or "for a limited period," because such a reading would erase the term from the provision:  the result would be the same as if the statute referred simply to "other than a[n] appointment limited to 2 years or less."  The word "temporary" should be given independent meaning, if possible.  

2. The court found an appropriate definition for the word "temporary" in OPM's regulation at 5 C.F.R. 213.104(a), which provides that "temporary appointments" are "made for a specified period not to exceed 1 year."  Ms. Mitchell's 18-month appointment did not meet this definition.

3. In addition to OPM's regulation, two additional considerations led to the same conclusion.  First, nothing indicates that the Department of Justice ever contemplated that the job it was giving Ms. Mitchell, even in December 2008, was a short-term job.  The reason for the time limit was not any expectation that the need for Ms. Mitchell's service in the job would come to an end; it simply reflected the fact that, operating under its waiver of the "preappointment investigative requirement," the Department had only "a limited period" to complete the background investigation when appointing Ms. Mitchell.  Second, determining that Ms. Mitchell did not hold a "temporary" appointment after December 2008 serves the statute's purpose; the purpose of the two-year trial period is to ensure that the agency can fully judge an employee's performance and yet vest these employees with important job protections.  Here, the parties stipulated that Ms. Mitchell held the "same or similar" positions from December 2008 through her termination, indicating that nothing meaningful about her job duties changed once the background investigation was completed.  

4. The court distinguished Federal Circuit decisions on which the Board had relied, and stated that its holding did not depart from the doctrine of harmless error.  The subject of the harmless-error doctrine, and of 5 U.S.C. 7701(c)(2), is "error" in the specific sense of a violation of legal requirements.  There has been no suggestion in this case that the agency's December 2008 appointment committed any violation of legal requirements.  It simply made a choice about the terms of the appointment.  

_________________________________________________________

     In her dissenting opinion, Judge Prost stated that the majority concluded that since Ms. Mitchell's 18 month appointment exceeded the 12-month set forth in 5 C.F.R. 213.104(a)(1), her initial appointment cannot be classified as temporary.  Judge Prost said that, even accepting the majority's view that section 213.104(a)(1) applies to 5 U.S.C. 7511(a)(1)(C)(ii), the fact remains that Ms. Mitchell only served less than 8 months of her initial 18-month appointment, making the Department of Justice's alleged error in granting Ms. Mitchell a temporary 18-month appointment harmless.  Judge Prost concluded that Ms. Mitchell's 8 months served pending the successful completion of her background check should not be tacked on to her time served in a permanent position for purposes of determining appeal rights.  


The U.S. Court of Appeals for the Federal Circuit issued nonprecedential decisions in the following cases:

DeOcampo v. Department of the Army, No. 2013-3090 (Jan. 7, 2014) (MSPB Docket No. SF-0752-11-0534-C-1) (affirming the Board's decision, which denied DeOcampo's petition for enforcement)

Adeleke v. Department of Homeland Security, No. 2013-3161 (Jan. 8, 2014) (review of arbitrator's decision) (affirming the arbitrator's decision, which denied Adeleke's request for attorney fees)

Cruz v. Office of Personnel Management, No. 2013-3156 (Jan. 13, 2014) (MSPB Docket No. SF-0842-12-0596-I-1) (affirming the Board's decision, which affirmed OPM's determination that Cruz was not entitled to a deferred retirement annuity)

Laguerra v. Merit Systems Protection Board, No. 2013-3152 (Jan. 13, 2014) (MSPB Docket No. DC-0752-12-0395-I-1) (affirming the Board's decision, which dismissed Laguerra's appeal for lack of jurisdiction)

White v. Merit Systems Protection Board, No. 2013-3146 (Jan. 14, 2014) (MSPB Docket No. DA-3330-12-0297-I-1) (affirming the Board's decision, which dismissed White's petition for review as untimely filed)

Faden v. Merit Systems Protection Board, No. 2013-3167 (Jan. 16, 2014) (MSPB Docket No.NY-0752-12-0231-I-1) (affirming the Board's decision, which dismissed Faden's appeal of a removal action as untimely filed)


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