No. 96-1395

IN THE SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1996

 JAMES B. KING, DIRECTOR, OFFICE OF
PERSONNEL MANAGEMENT, PETITIONER

v.

LESTER E. ERICKSON, JR., ET AL.
_____________

JAMES B. KING, DIRECTOR, OFFICE OF
PERSONNEL MANAGEMENT, PETITIONER

v.

HARRY R. MC MANUS, ET AL.
_____________________

ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE FEDERAL CIRCUIT
________________

PETITION FOR A WRIT OF CERTIORARI

LORRAINE LEWIS
General Counsel

STEVEN E. ABOW
JOSEPH E. MCCANN
ANA A. MAZZI
Attorneys
Office of General Counsel
Office of Personnel
Management
Washington, D.C. 20415

WALTER DELLINGER
Acting Solicitor General

FRANK W. HUNGER
Assistant Attorney General

SETH P. WAXMAN
Deputy Solicitor General

JAMES A. FELDMAN
Assistant to the Solicitor
General

DAVID M. COHEN
TODD M. HUGHES
Attorneys

Department of Justice
Washington, D.C. 20530-0001
(202) 514-2217

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QUESTION PRESENTED

Whether the Due Process Clause precludes a fed-
eral agency from sanctioning an employee for making
false statements to the agency regarding allegations
that the employee had engaged in employment-related
misconduct.

(I)

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II

PARTIES TO THE PROCEEDING

    In addition to the parties named in the caption, the
parties to the proceedings in the Federal Circuit
were Jeanette M. Walsh, Michael G. Barrett, Jerome
K. Roberts, Sharon Kye, and the Merit Systems Pro-
tection Board.

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TABLE OF CONTENTS

Page

Opinions below  . . . .  1
Jurisdiction  . . . .  2
Constitutional provision involved  . . . .  2
Statement  . . . .  2
Reasons for granting the petition  . . . .  12
Conclusion  . . . .  23
Appendix A  . . . .  1a
Appendix B  . . . .  24a
Appendix C  . . . .  29a
Appendix D  . . . .  50a
Appendix E  . . . .  59a
Appendix F  . . . .  70a
Appendix G  . . . .  97a
Appendix H  . . . .  106a
Appendix I  . . . .  108a

TABLE OF AUTHORITIES

Cases: 

Boddie  v. Connecticut, 401 U.S. 371 (1971)  . . . .  18
Bryson  v. United States, 396 U.S. 64  (1969)  . . . .  5, 18, 19
Cleveland Bd. of Educ. v. Loudermill, 470 U.S. 532
(1985)  . . . .  17,18
FDIC v. Mallen, 486 U.S. 230 (1988)  . . . .  18
Glickstein  v. United States, 222 U.S. 139(1911)  . . . .  19
Goldberg  v. Kelly, 397 U.S. 254 (1970)  . . . .  18
Goss v. Lopez, 419 U.S. 565 (1975)  . . . .  17
Greene v. McElroy, 360 U.S. 474 (1959)  . . . .  18
Grubka v. Department of the Treasury, 858 F.2d
1570(Fed. Cir. 1988)  . . . .  4
Hewitt  v. Helms, 459 U.S. 460 (1983)  . . . .  18
Kalkines v. United States, 473 F.2d 1391 (Ct.
Cl.  1973)  . . . .  19
Mathews  v. Eldridge, 424 U.S. 319 (1976)  . . . .  18

(III)

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IV

Cases-Continued:            Page

Morgan v. United States, 304 U.S. 1 (1938)  . . . .  18
Nix v. Whiteside, 475 U.S. 157 (1986)  . . . .  20
Rock v. Arkansas, 483 U.S. 44 (1987)  . . . .  20
United States v. Apfelbaum, 445 U.S. 115
(1980)  . . . .  19
United States v. Dunnigan, 507 U.S. 87 (1993)  . . . .  20
United States v. Equihua-Juarez, 851 F.2d 1222
(9th Cir. 1988)  . . . .  15
United  States v.  Fausto, 484 U.S. 439 (1988)  . . . .  22
United  States  v. Grayson, 438 U.S. 41 (1978)  . . . .  20
United States v. Havens, 446 U.S. 620 (1980) . . . .  19, 20
United States v. Holmes, 840 F.2d 246 (4th Cir.),
cert. denied, 488 U.S. 831 (1988)  . . . .  15
United States  v. Knox, 396  U.S.  77 (1969)  . . . .  19-20
United States v. LeMaster, 54 F.3d 1224 (6th Cir.
1995), cert. denied, 116 S. Ct. 701 (1996)  . . . .  15
United States v. Moore, 27 F.3d 969 (4th Cir.),
cert. denied, 115 S. Ct. 459 (1994)  . . . .  15
United States v. Myers, 878 F.2d 1142 (9th Cir.
1989)  . . . .  15
United States  v. Rodriguez-Rios, 14 F.3d 1040 (5th
Cir. 1994)  . . . .  15
United States v. Watts, 117 S. Ct. 633 (1997)  . . . .  21
United States v. Wiener, 96 F.3d 35 (1996), opinion
supplemented, Nos. 95-1294, 95-1403, 95-1597, 1996  . .  15
WL  531009 (2d Cir. Sept. 16, 1996)  . . . .  15
Vitek  v. Jones, 445 U.S. 480 (1980)  . . . .  18
Washington v. Harper, 494 U.S. 210 (1990)  . . . .  18
Wolff  v. McDonnell, 418 U.S. 539 (1974)  . . . .  18

Constitution, statutes and regulations:

U.S. Const. Amend. V (Due Process Clause)  . . . .  2, 10,
                                                                     16, 17, 19, 21
5 U.S.C. 7513(b)  . . . .  10
5 U.S.C. 7513(b)(l)  . . . .  16

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V

Statutes and regulations-Continued:       Page

5 U.S.C. 7513(b)(2)  . . . .  17
5 U.S.C. 7513(d)  . . . .  22
5 U.S.C. 7703  . . . .  22
18 U.S.C. 1001  . . . .  15
Sentencing Guidelines:
 3C1.1  . . . .  20, 21
Application Note 3(g)  . . . .  21
 6A1.3 commentary  . . . .  21

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IN THE SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1996

No.

JAMES B. KING, DIRECTOR, OFFICE OF
PERSONNEL MANAGEMENT, PETITIONER

v.

LESTER E. ERICKSON, JR., ET AL.

JAMES B. KING, DIRECTOR, OFFICE OF
PERSONNEL MANAGEMENT, PETITIONER

v.

HARRY R. MCMANUS, ET AL.

ON PETITION FOR A WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
 FOR THE FEDERAL CIRCUIT

PETITION FOR A WRIT OF CERTIORARI

    The Acting Solicitor General, on behalf of James B.
King, the Director of the Office of Personnel Manage-
ment, respectfully petitions for a writ of certiorari to
review the judgments of the United States Court of
Appeals for the Federal Circuit in these cases.

OPINIONS BELOW

    The decision of the court of appeals in King v.
Erickson (App., infra, 1a-23a) is reported at 89 F.3d
1575.  The decision of the court of appeals in King v.
McManus (App., infra, 24a-28a) is unpublished.  The

(1)

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2

decision of the Merit Systems Protection Board
(MSPB) in Walsh v. Department of Veterans Affairs
(App., infra, 29a-49a) is reported at 62 M.S.P.R. 586.
The decision of the MSPB in Erickson v. Department
of the Treasury (App., infra, 50a-58a) is reported at 63
M.S.P.R. 80.  The decision of the MSPB in Kye v.
Defense Logistics Agency (App., infra, 59a-69a) is
reported at 64 M.S.P.R. 570. The decision of the
MSPB in Barrett v. Department  of the Interior (App.,
infra, 70a-96a) is reported at 65 M.S.P.R. 186. The
decision of the MSPB in McManus v. Department
of Justice (App., infra, 97a-105a) is reported at 66
M.S.P.R. 586.

JURISDICTION

    The judgment of the court of appeals in King v.
Erickson  was entered on July 16, 1996. The judgment
of the court of appeals in King v. McManus was
entered on July 22,-1996. The petitions for rehearing
in both cases were denied on November 4, 1996. App.
infra, 106a-109a. On January 27, 1997, Chief Justice
Rehnquist extended the time for filing a petition for a
writ of certiorari to and including March 4, 1997. The
jurisdiction of this Court is invoked under 28 U.S.C.
1254(1).

CONSTITUTIONAL PROVISION INVOLVED

    The Due Process Clause of the Fifth Amendment
provides: "[N]or [shall any person] be deprived of life,
liberty, or property, without due process of law."

STATEMENT

    These two cases arise from a total of five separate
disciplinary proceedings against government employ-
ees. Each employee appealed his or her discipline to
the Merit Systems Protection Board (MSPB). In

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each ease, the MSPB upheld an underlying charge of
misconduct but reversed a charge that the employee
had made false statements regarding the misconduct.
In light of that reversal, the MSPB also mitigated the
sanction imposed in each case. The Federal Circuit
affirmed each of those decisions.
    1. a. Walsh.  Respondent Jeanette Walsh was
employed as a Social Services Assistant at a medical
center operated by the Department of Veterans
Affairs in St. Cloud, Minnesota. She was charged
with having sexual relations with a patient and other
misconduct. App., infra, 2a. An administrative judge
found that the charges had not been proven. Id. at 30a.
The MSPB reversed in part, finding that, "while em-
ployed as a social services assistant, [Walsh] engaged
in sexual relations with an alcohol-dependent patient
at the agency medical center." Id. at 41a. The MSPB
found that the relations began when the patient was
an inpatient, as early as September 1988, and contin-
ued after he became an outpatient in November 1988.
Id. at 34a-37a. The MSPB noted that her misconduct
"was intentional and continued for some 18 months."
Id. at 42a.
    Walsh was also charged with making false state-
ments concerning her relationship with the patient, a
charge that the administrative judge affirmed. That
charge was based on inconsistent statements Walsh
had given to her employer. In a December 1988
meeting with a supervisor, Walsh had acknowledged
having an intimate relationship with the patient at
that time. App., infra, 2a. Later, in a 1991 affidavit,
Walsh stated that during the December 1988 meeting
she had denied having an intimate relationship with
the patient. Ibid. Moreover, she consistently stated
that she had not had any relationship with the patient

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while he was an inpatient-i.e., during the period
from April 1988 through November 1, 1988.  Id. at  3a.
    The MSPB did not dispute that Walsh had made
false statements regarding her misconduct. Relying
on a new reading of the Federal Circuit's decision in
Grubka v. Department  of the Treasury, 858 F.2d 1570,
1475 (1988), however, the MSPB held that an agency
may not "separately charge an employee with miscon-
duct and making false  statements or a similar offense
regarding the alleged misconduct." App., infra, 41a.
That result was necessary, in the MSPB's view, to
protect the employee's "due process right to have an
opportunity to be hear-d on a charge, and not to have a
falsification type charge automatically sustained by
virtue of the sustaining of an underlying charge." Id.
at 40a. For the same reason, the MSPB held that
Walsh's false statements could not be considered as
aggravating factors that would increase the penalty
imposed on Walsh for the charge of misconduct the
MSPB sustained. Id. at 42a. Reviewing the sanction
imposed on Walsh in light of its reversal of the
falsification charge, the MSPB substituted a 90-day
suspension for the penalty of removal that the agency
had imposed.
    Chairman Erdreich filed a concurring opinion.
App., infra, 45a-49a. In his view, the principle that
"an employee may give an untrue denial statement in
response to an agency investigation * * * without
the possibility of discipline for that statement * * *
seems to conflict with several mandates that require
a federal employee to be truthful in dealings with his
federal employer." Id. at 45a. That leads to the
"anomalous result that an employee may be required
to respond to an agency inquiry, but may not be re-
quired to respond truthfully." Id. at 46a. It also

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"give[s] federal employees a privilege not accorded to
ordinary citizens who `may decline to answer the
question, or answer it honestly, but [who] cannot with
impunity knowingly and willfully answer with a
falsehood.'" Id. at 46a-47a (quoting Bryson v. United
States, 396 U.S. 64, 72 (1969)). Expressing his "con-
cerns about how this decision * * * affects the
standards of employee conduct basic to the ethical
underpinnings of our federal civil service," id. at 49a,
Chairman Erdreich nonetheless concurred on the
ground that Grubka and a later Federal Circuit
decision compelled that result.    See ibid.
    b. Erickson. Respondent Lester Erickson, Jr.,
was employed as a Supervisory Police Officer with
the Bureau of Engraving and Printing. The agency
had apparently been suffering from a series of "Mad
Laugher" harassing telephone calls, in which some-
one would anonymously call agency employees during
work hours, laugh continuously, and then hang up.
Erickson was charged with having encouraged an em-
ployee of an agency contractor to make a "Mad
Laugher" call to an agency police officer. App., infra,
5a.  The MSPB sustained that charge of misconduct.
Id. at 7a, 54a-55a.
    Erickson was also charged with making a false
statement in a matter of official interest, in violation
of the agency's minimum standards of conduct.  App.,
infra, 52a, That charge was based on Erickson's re-
sponses to a series of questions posed by an agency
investigator regarding the "Mad Laugher" calls. In
particular, Erickson had stated that he "never par-
ticipated" in the calls; that he "d[id] not know who"
was making the calls;  and that he "do[es] not know the
true identification of the `Mad Laugher.'" Id. at 5a-
6a, 52a.  Erickson added that "[i]n my opinion it is

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95% of the police unit [and] also possibly personnel in
Production." Id. at 6a, 52a-53a.
    Based on its decision in Walsh, the MSPB did not
sustain the false statement charge, stating that "[a]n
agency may not charge an employee with falsely
denying misconduct when it is separately charging
the employee with the underlying misconduct." App.,
infra, 53a. The MSPB accordingly mitigated the
sanction of removal to a 15-day suspension. Id. at 54a-
55a. c.
     Kye. Respondent Sharon Kye was employed as a
Supervisory General Supply Specialist for the De-
fense Logistics Agency.   She was charged with
failing to safeguard a government Diners Club credit
card, failing to follow instructions for reporting loss,
theft, or compromise of the card, and misuse of the
card.  The card was used on more than 29 different
occasions during March 1993 to make improper cash
withdrawals from ATM machines amounting to more
than 2,000.  Initial Decision at 2.  In addition, Kye
used the card for the rental of a motel room on March
31, 1993, and the agency produced the motel regis-
tration form signed by Kye. Id. at 9. Kye was not
authorized to use the  card at all during that period,
because she was not on official travel. Id. at 2.  The
MSPB sustained the charges of misconduct. App.,
infra, 59a-67a.
    Kye was also charged with providing false infor-
mation in an official investigation.  She repeatedly
maintained that she had not herself used the card for
any of the improper charges.  In addition, she told an
agency investigator on one occasion that she had lost
possession of the card while it was being misused, but
that she had torn it up as soon as she regained
possession of it, on April 2 or 3, 1993.  Initial Decision

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at 5.  At a later interview, she stated that she did not
have possession of the card in early April 1993, but
that she had in fact torn it up during the middle of
April. Id. at 6. In fact, the evidence showed that she
had the card in her possession on March 31, when she
used it at the motel. Id. at 9.
    Based on its decision in Walsh, the MSPB did not
sustain the false statement charge. App., infra, 63a.
The MSPB accordingly mitigated the sanction of re-
moval to a 45-day suspension. Id. at 63a-64a. Member
Amador dissented from the decision to mitigate the
sanction, on the ground that the charges that had
been sustained were sufficient to warrant the sac-
tion of removal. Id. at 67a-69a.
    d. Barrett and Roberts. Respondents Michael Bar-
rent and Jerome Roberts were employed as Soil
Scientists by the Department of the Interior. In June
1988, they left their duty stations in a government
pickup truck to build a fish pond in the backyard of
their supervisor's house.  They did not take leave for
the time they were not on duty. App., infra, 9a, 71a.
As a result of that incident, they were charged with
making a false claim on their time and attendance
reports when they represented that they had been on
duty during the period that they had been assisting
with the fish pond. Id. at 85a.
    Barrett and Roberts also were charged with miss-
representation or concealment of a material fact in
connection with an investigation.  When the agency
personnel officer had inquired about the alleged miss-
conduct, "Roberts stated in response to the inquiry
that he did not remember anything about the build-
ing of a fish pond, while Barrett stated that he only
worked on the fish pond on his own time." App., infra,
86a.  The administrative judge had found that those

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statements were false.  In addition, Barrett and
Roberts were charged with failing to report an act of
fraud, waste, and abuse "when they failed to disclose
to agency officials that [their supervisor] did not
charge them leave for the time that they worked on
the fish pond." Ibid.  The administrative judge us-
tainted that charge as well.
    Based on its decision in Walsh, the MSPB did not
sustain the false statement charge. App., infra, 86a-
87a. In addition, the MSPB held that for similar
reasons the charge of failure to report an act of fraud
also could not be sustained. Id. at 87a.  In the MSPB's
view, respondents' disclosure of the fraud "would have
necessitated implicating themselves in the mission-
duct of filing a false time and attendance report,"
Ibid.  The MSPB concluded that "[a] charge based on
such a requirement of self-implication is contrary to
*** Walsh" and therefore had to be reversed as
well. Ibid. Accordingly, the MSPB substituted a
letter of reprimand for the demotions and 30-day
suspensions the agency had imposed on Barrett and
Roberts. Id. at 71a, 88a-89a.  Member Amador dis-
sented in part, stating that the appropriate punish-
ment in his view was a 30-day suspension. Id. at 91a-
96a.
     e. McManus. Respondent Harry McManus was
employed as a Supervisory Correctional Officer with
the Department of Justice.  He was charged with
conduct unbecoming a supervisor, based on various
sexual comments he had made to a female correctional
officer.  For example, he had referred to her bra size,
had asked her about her preferred sexual positions,
told her he had a "bulge" in his pants when thinking
about that subject, and asked whether the female
officer could see how much she excited him. App.,

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infra, 98a. The MSPB affirmed the administrative
judge's findings that McManus had engaged in
misconduct.  Id. at 97a-105a.
    McManus also was charged with making false
statements during the agency's investigation.  Dur-
ing an initial interview, McManus had denied having
told the female officer that he was disappointed she
had not called one evening when they were on duty
together;  he denied having stated that "he would have
[the female officer] relieved so that she could come
over to [McManus's post] and tease him more"; he
"flatly denied discussing the subject of preferred
sexual positions" with the female officer; and he
"denied that he told [the female officer] that he had a
bulge (in his pants) while talking with her." App.,
infra, 25a-26a.  In a later interview he admitted that
in fact he made all of those statements. Ibid.
    Based on its decision in Walsh, the MSPB did not
sustain the false statement charge.  App., infra, 100a.
The agency argued that the MSPB should nonethe-
less take McManus's false statements into account in
assessing his credibility when he denied that the
female officer had ever specifically discouraged his
remarks.  That testimony contradicted statements
by the female officer that, although she initially par-
ticipated in the sex-related joking, she later told
McManus to stop.  The MSPB, however, categorically
"decline[d] to consider [McManus's] false statement
in analyzing the penalty issue''-even for such im-
peachment purposes. Ibid.  The MSPB accordingly
substituted a 14-day suspension for the demotion the
agency had imposed on McManus.  Id. at 103a.
    2. In its decision in Erickson, the court of appeals
considered appeals from the MSPB's decisions re-
garding Erickson, Walsh, Barrett and Roberts, and

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Kye. App., infra, 1a-23a. Relying on "procedural due
process concerns," id. at 20a, the court held "that an
agency may not charge an employee with falsification
or a similar charge on the ground of the employee's
denial of another charge or of underlying facts relat-
ing to that other charge," id. at 21a.
    The court initially noted "that the government em-
ployees here had a protected property interest in
their employment," App., infra, 10a, and that they
were therefore entitled both under applicable statutes
and under the Due Process Clause to notice and a
meaningful opportunity to be heard before adverse
action is taken against them, id. at 10a-11a (citing 5
U.S.C. 7513(b)).  The court agreed with the MSPB
that its earlier Grubka decision was correctly inter-
preted to hold "that an employee's denial of the factual
basis of a [misconduct] charge may not be used as the
basis for a falsification charge." Id. at 15a.
    The court also rejected- the suggestion that there
should be any distinction between denying an allega-
tion of misconduct and denying the facts underlying
the allegation.  In the court's view, "[allowing an
agency to charge an employee with falsely denying
facts underlying a misconduct charge would deprive
the employee of a meaningful opportunity to respond
to the charges." App., infra, 16a.  The court noted
that "employees might be reluctant to deny charges
for fear that their denials would be construed as
denials of facts, which in OPM's view would subject
them to an additional falsification charge." Ibid. The
court also stated that if falsification charges were
permitted in this context, employees could be "co-
erced into admitting the misconduct, whether they    
believe that they are guilty or not, in order to avoid
the more severe penalty of removal possibly resulting

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from a falsification charge." Id. at 16a-17a. In the
court's view, that "would create a `chilling effect' on
their clear right to defend themselves, a `Catch-22'
situation for employees that is inconsistent with the
due process right provided by federal law to enable
them to defend themselves." Id. at 17a.
    The court stated that its holding did not "mean
* * * that an employee has a right to lie or affirma-
tively mislead an agency engaged in an investiga-
tion." App., infra, 17a.  The court stated that "[b]e-
yond a denial of a charge or of the factual accusations
supporting a charge, an employee may not make up
a false story, or tell `tall tales' in order to defend
against a charge." Ibid.  The court also stated that
"when the agency is in an investigatory mode, prior
to charges having being brought," and "when inves-
tigations are conducted concerning the conduct of
other employees, false statements are actionable." Id.
at 18a.
    Applying the above principles, the court of appeals
affirmed the MSPB's decisions in each of the cases
before it.  In Walsh's case, the court held that the
employee's statements were "mere denials of having
an intimate relationship with the patient" and were
therefore insufficient to support a false statement
charge. App., infra, 22a. In Erickson's case, the
court affirmed the MSPB's decision because the em-
ployee's denials of having knowledge of or participat-
ing in the "Mad Laugher" calls "were denials of hav-
ing engaged in such conduct" and "were thus not
otherwise false." Ibid.  In Kye's case, the court held
that the employee's denials of having misused the
credit card and her other statements "in effect were
***  denials and were not actionable false
statements." Id. at 23a. Finally, in Barrett's and

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Roberts' case, the court held that the employees'
statements that "they knew nothing of the events in
question" were not actionable because they were "in
essence * * * denial[s] and w[ere] not otherwise
false." Ibid.
    3. Eight days after its decision in Erickson, the
Federal Circuit decided McManus in an unpublished
decision. App., infra, 24a-28a.  The court relied on its
decision in Erickson to hold that the employee's
denials of having made sexual comments to the female
officer "were within the range of denials that must be
permitted in order to make meaningful the right to
respond to charges." Id. at 28a. Accordingly, the
court concluded that "the board did not err in revers-
ing the falsification charge against McManus." Ibid.

REASONS FOR GRANTING THE PETITION

    Before the government may deprive one of its em-
ployees of a protected property interest in employ-
ment based on an allegation of misconduct, the
employee must ordinarily be given notice and an
opportunity to be heard on the charges.  The em-
ployee's right to a meaningful opportunity to be
heard, however, has  never been understood to include
the right to make false statements with impunity
during an agency investigation. To the contrary, the
court of appeals' conclusion is inconsistent with
settled principles that the Constitution contains no
right to lie.  Because the court of appeals' decision
threatens to do substantial damage to the ethical
underpinnings of the civil service and represents an
unjustifiable judicial intrusion into the proper scope
of federal employee discipline, further review is
warranted.

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    1. The basic holding of the court of appeals in these
cases is unequivocal: "an agency may not charge an
employee with falsification or a similar charge on the
ground of the employee's denial of another charge or
of underlying facts relating to that other charge."
App., infra, 21a.  That ruling creates a right to lie for
federal employees  suspected of  on-the-job wrongdoing.
Although the court of appeals recognized that "the
agency is entitled to truth-telling" in some circum-
stances, id. at 18a, the holding of the court of appeals
is that federal agencies are not so entitled when their
employees face allegations of misconduct.
    The court of appeals accorded an extraordinary  
breadth of protection to the right that it created. The
Federal Circuit held not only that the employee's
false statements may not serve as a distinct ground
for discipline, but also that "[d]enials of charges and
related facts may not be considered in determining a
penalty" for the underlying misconduct. App., infra,
21a. Thus, if the employee's misconduct is proven, the
agency may not take the employee's false statements
into account in settling upon the appropriate sanc-
tion; the agency must treat the employee as if the
employee had been entirely honest and forthcoming
throughout the investigation.  Moreover, although an
employee who makes false statements regarding the
misconduct of others apparently remains subject to
discipline, see id. at 18a, an employee who takes the
same action to cover up his own misconduct cannot be
made to suffer any consequences on that account.
    2. The Federal Circuit asserted that the protec-
tion it was granting to false statements was limited.
The court stated that its holding "does not mean
** * that an employee has a right to lie or affir-
matively mislead an agency engaged in an investiga-

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14

tion." App., infra, 17a. The court added that "an
employee may not make up a false story, or tell `tall
tales' in order to defend against a charge," and that
"falsehoods which go beyond denial and defense are
actionable by an agency as falsification." Ibid. Those
statements do not, however, mitigate the untoward
consequences of the court's rule.
     First, the Federal Circuit's assurances that an
agency may still sanction ''affirmative[] mislead[ing]"
or "falsehoods which go beyond denial and defense"
are of limited value in light of the court's treatment of
the cases before it.  Respondent Erickson, for exam-
  pie, not only denied having made the "Mad Laugher"
calls, but added that "[i]n my opinion it is 95% of the
police unit [and] also possibly personnel in Produc-
tion" who made the calls. App., infra, 6a.  Respondent
Kye falsely stated that she did not have possession of
the credit card during the time it had been misused
and that she had torn the credit card up as soon as she
regained possession  of it, on April 2 or 3, 1993.  She
then stated (again falsely) that she had in fact torn it
up during the middle of April.  All of those statements
were more than mere "denials" and amounted to
efforts to "affirmatively mislead" the agency.  Yet the
Federal Circuit nonetheless held that the Consti-
tution precluded the agencies involved from bringing
charges based on those false statements or taking the
false statements into account in any way in determin-
ing the appropriate discipline.
    Second, the line between "affirmative misstate-
ments" or "tall tales," on the one hand, and mere "de-
nial and defense," on the other, is inherently unstable.
Government agencies as employers will generally ask
their employees a wide range of questions regarding
their on-the-job activities, particularly when miscon-

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15

duct is suspected.  Such questions frequently require
an employee who wants to retain credibility while
falsely denying misconduct to make other false state-
ments about related matters as well.  In those circum-
stances, protection for the false denials necessarily
shades over into protection for the affirmative mis-
statements. 1.

___________________(footnotes)

    1. The rule adopted by the Federal Circuit is similar in some
respects to the so-called "exculpatory no" doctrine, which has
been used by some courts of appeals to preclude the application
of the federal criminal false statement statute, 18 U.S.C. 1001,
to mere exculpatory denials of wrongdoing.  But see United
States v. Rodriguez-Rios, 14 F.3d 1040, 1044-1045 (5th Cir.
1994) (en banc) (rejecting doctrine); United States v. Wiener,
96 F.3d 35, 37 (1996) (same), opinion supplemented on other
grounds, Nos. 95-1294, 95-1403, 95-1597, 1996 WL 531009 (2d Cir.
Sept. 16, 1996); cf. United States v. LeMaster, 54 F.3d 1224,
1227-1230 (6th Cir. 1995), cert. denied, 116 S. Ct. 701 (1996).
The experience of the courts that have applied that doctrine
is instructive.  Although the courts that accept the doctrine
routinely recite that the doctrine protects only exculpatory
denials and does not extend to affirmative misstatements, the
lines they have attempted to draw between the two categories
of false statements are not stable.  Compare, e.g., United  States
v. Moore, 27  F.3d 969, 979-980 (4th Cir.) (holding that "excul-
patory no" doctrine did not protect a defendant's denials that a
signature was his, that he had prepared certain tax returns,
and that he had ever prepared similar tax returns), cert.
denied, 115 S. Ct. 459 (1994), and United States v. Holmes, 840
F.2d 246, 249 (4th Cir.) (holding that signing a document with
a false name is not protected by "exculpatory no" doctrine),
cert. denied, 488 U.S. 831 (1988), with United States  v. Myers,
878 F.2d 1142, 1143, 1144 (9th Cir. 1989) (holding that "excul-
patory no" doctrine protected a defendant who "concocted a
story about the [defendant] losing his contact lenses while in
flight and, as a result, inadvertently flying into prohibited air-
space") and United States v. Equihua-Juarez, 851 F.2d 1222,
1224-1227 (9th Cir. 1988) (holding that "exculpatory no" doc-

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16

    Third, and perhaps most important, even if the
Federal Circuit's rule could effectively be limited in
the ways suggested by that court, the rule would still
confer a broad and unwarranted immunity on federal
employees who make false statements.  Under any
version of  the Federal Circuit's rule, federal em-
ployees would have substantial latitude to make false
statements to their agencies about their on-the-job
conduct. Indeed, the recognition of even a limited
constitutional right to deceive represents an unwar-
ranted intrusion on the discretion of the govern-
ment to determine under what circumstances on-the-
job misconduct by government employees-including
on-the-job dishonesty-should lead to disciplinary
action. 2.
    3. The court of appeals squarely rested its hold-
ings on the Due Process Clause of the Fifth Amend-

___________________(footnotes)

trine protects defendant who provided a false name to federal
investigators).
    2.  In a further effort to limit its ruling, the Federal Circuit
stated that "when the agency is in an investigatory mode, prior
to charges having been brought, the agency is entitled to truth-
telling by its employees."  App., infra, 18a. In each of the cases
at issue here, however, the employee made some or all of the
false statements in the course of an agency investigation, i.e.,
before a notice of adverse action under 5 U.S.C. 7513(b)(l) was
sent to the employee. Indeed, the Federal Circuit's own de-
scriptions of several of the false statements essentially acknowl-
edge as much.  See App., infra, 5a (Erickson made false state-
ments "when responding to a list of questions from an agency
investigator"), 9a (Barrett and Roberts "provided false infor-
mation in response to the agency's inquiry"), 25a (McManus
made false statements "when McManus was interviewed dur-
ing the agency's investigation").  Nonetheless, the court held
that each of the employees could not be disciplined for the false
statements.

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17

ment.  The court began its discussion in Erickson by
quoting that Clause.  See App., infra, 10a. The court
then cited to Cleveland Board of Education v.
Loudermill, 470 U.S. 532, 546 (1985), a leading case
from this Court holding that the Due Process Clause
grants employees who have property interests in
their government employment a meaningful opportu-
nity to be heard before they may be deprived of those
interests.  See App., infra, 11a.  Throughout its opin-
ion, the court relied on the constitutional right to "a
meaningful opportunity to respond," id. at 16a (em-
phasis omitted), and "the due process right provided
by federal law," id. at 17a, as the bases for its rule. 3.
Although the court did in one place quote the statute
providing employees charged with misconduct with "a
reasonable time * * * to answer orally and in
writing," see 5 U.S.C. 7513(b)(2), the court did so
simply to note that "compliance with the[] [statutory]
procedures satisfies the minimum due process re-
quirements to which the employee is entitled." App.,
infra, 11a. The court did not suggest that the statute
itself grants an employee a right to make false
denials, and nothing in the statutory language would
support creation of such a right.
    The court of appeals' derivation of a right to make
false statements from constitutional procedural due
process principles has no foundation in the decisions
of this Court. No decision of this Court addressing
the scope or nature of the due process right to a

___________________(footnotes)

    3.  See App., infra, 17a ("meaningful opportunity to re-
spond"), 19a ("due process requires that an employee be al-
lowed to deny both a charge and the underlying facts without
being subject to a falsification charge"), 20a ("the holding in
Grubka  was  based on procedural due process concerns").

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18

meaningful opportunity to be heard has suggested
that it includes the right to make false statements
with impunity. 4. In Loudermill, for example, the
Court discussed "`tie root requirement' of the Due
Process Clause as being `that an individual be given
an opportunity for a hearing before he is deprived of
any significant property interest.'" 470 U.S. at 542
(quoting Boddie v. Connecticut, 401 U.S. 371, 379
(1971)). Nothing in Loudermill suggests that the
right to a hearing extends to the right to make false
statements at such a hearing. Nor does any other
case from this Court suggest that the purely proce-
dural right to a meaningful opportunity to be heard
includes a substantive right limiting the govern-
ment's ability to sanction employees who make false
statements. 5.
    4. The Federal Circuit's decision conflicts with de-
cisions of this Court making clear that the Constitu-
tion does not recognize a right to lie and that an indi-
vidual who chooses to answer questions by making
false statements may be made to suffer penalties on
that account. In Bryson v. United States, 396 U.S. 64
(1969), the Court stated the governing legal principle:

___________________(footnotes)

    4  See, e.g., Washington v. Harper, 494 U.S. 210, 228-236
(1990);  FDIC  v. Mallen, 486 U.S. 230, 240-248 (1988); Hewitt v.
Helms, 459 U.S. 460, 472-477 (1983); Vitek v. Jones, 445 U.S.
480, 494-496 (1980); Mathews v. Eldridge, 424 U.S. 319, 339-349
(1976); Goss v. Lopez, 419 U.S. 565, 577-584 (1975); Wolff v.
McDonnell, 418 U.S. 539, 563-572 (1974); Goldberg v. Kelly, 397
U.S. 254, 266-271 (1970); Greene v. McElroy, 360 U.S. 474, 496-
497 (1959); Morgan v. United States, 304 U.S. 1, 14-15, 18-22
(1938)
    5 The Court recognized that in some circumstances, "a post-
deprivation hearing will satisfy due process requirements."
470 U.S. at 542 n.7.

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19

"Our legal system provides methods for challenging
the Government's right to ask questions-lying is
not one of them." Id. at 72 (footnote omitted). The
court explained that "[a] citizen may decline to
answer the question, or answer it honestly, but he
cannot with impunity knowingly and willfully answer
with a falsehood." Ibid.  See also Glickstein v. United
States, 222 U.S. 139, 142 (1911) (Fifth Amendment
"does not endow the person who testifies with a li-
cense to commit perjury").
    Although the Court enunciated those principles in
a criminal case, they apply equally in this context. In
one respect, government employees are in a different
position from most individuals in a criminal setting
who may assert their privilege against compelled self-
incrimination in response to questions; government
employees have an obligation to cooperate with their
employer and therefore do not have the option of
simply remaining silent.  See, e.g., Kalkines v.
United States, 473 F.2d 1391 (Ct. C1. 1973).  But that
difference does not suggest that government employ-
ees should be given a compensating right to respond
to questions with false statements.  If an employee
does not want to answer questions honestly regard-
ing his on-the-job misconduct-i. e., if the employee is
unable to fulfill a basic condition of the employee-
employer relationship-the employee may refuse to
answer and suffer whatever penalties ensue.  In any
event, even if the federal employee were viewed as
having been compelled to answer questions, that
would not affect the analysis.  In the criminal context,
too, even an individual who is compelled to provide the
government information-on a form required by the
National Labor Relations Board, as in Bryson, on a
wagering tax form, as in United States v. Knox, 396

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20

U.S. 77,79 (1969), or because he has been granted use
immunity for his testimony, see United States v.
Apfelbaum, 445 U.S. 115, 126-127 (1980)-must tes-
tify truthfully or suffer the consequences. United
States v. Havens, 446 U.S. 620,626 (1980).
In United States v. Dunnigan, 507 U.S. 87 (1993),
this Court held that Sentencing Guidelines Section
3C1.1, which requires an enhancement of the defen-
dant's sentence if the defendant commits perjury at
trial, does not "undermine[]" the constitutional right
to testify. 507 U.S. at 96.  The Court noted that the
"right to testify does not include a right to commit
perjury." Ibid. (citing Nix v. Whiteside, 475 U.S. 157,
173 (1986); United States v. Havens, 446 U.S. at 626;
United States v. Grayson, 438 U.S. 41,54 (1978)). The
Court also noted that the Guidelines provision does
not "distort[] [the defendant's] decision whether to
testify or remain silent," since there is no "categori-
cal ban on every governmental action affecting the
strategic decisions of an accused, including decisions
whether or not to exercise constitutional rights."
Ibid. 
    The right to testify addressed by the Court in
Dunnigan has its roots in large part in the same due
process principles that produce the right to a
meaningful opportunity to be heard relied upon by the
Federal Circuit in this case.  See Rock v. Arkansas,
483 U.S. 44, 51 & n.9 (1987). Consequently, the prin-
ciple of  Dunnigan that the right to testify does
not include a right to testify falsely conflicts with
the Federal Circuit's holding that the right to a
meaningful opportunity to be heard does include the
right to make false statements.  Indeed, the specific
holding of  Dunnigan that a defendant's sentence may
be enhanced for false testimony is irreconcilable with

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21

the Federal Circuit's conclusion that "one can hardly
justify enhancing a misconduct penalty because of
* * * falsification." App., infra, 21a. 6.

___________________(footnotes)


     6.  The court of appeals' attempts to distinguish Dunnigan
are unavailing.  The court first stated that Dunnigan "only
dealt with enhancement of a sentence in a criminal context,
where there is a heavier burden of proof than agencies have in
proving charges of falsification against employees."  App.,
infra, 21a.  That account is wrong.  The burden of proof in the
federal criminal sentencing context is ordinarily precisely the
same preponderance-of-the-evidence standard that applied to
the charges of falsification in these cases.  See United States v.
Watts, 117 S. Ct. 633, 637 (1997) (per curiam) (citing Sentenc-
ing Guidelines  6A1.3 commentary).  In any event, the heavier
burden of proof  in criminal cases is  a reflection of the fact that
the defendant's liberty-and not merely a property interest-
is at stake.  Even if criminal sentencing determinations had to
be supported by a higher burden of proof, that would have no
bearing on the question whether a defendant-or, in this case,
a government employee-may suffer additional sanctions for
making false statements.
    The court of appeals also stated that "the crime of perjury
consists of lying under oath, a much more serious offense than
violation of 5 C.F.R.  5.4 [which requires federal employees to
cooperate with investigations and to testify truthfully], thereby
justifying a penalty beyond that levied on the basic offense."
App., infra, 21a. Under Dunnigan, however; a federal court
may impose a longer sentence, thereby depriving a defendant
of liberty, on account of false statements made at trial that
materially affect the prosecution.  If the Due Process Clause
does not forbid imposition of that consequence on those who
testify falsely at trial, it surely does not prohibit the much less
severe sanctions at issue here.  Moreover, the Guidelines pro-
vision at issue in Dunnigan permits an enhancement not only
for perjury at trial, but also for unsworn false statements
that obstruct an investigation, similar to the false statement
sanctions the Federal Circuit held to be unconstitutional in
this case. See Guidelines  3C1.1 & Application Note 3(g)
(enhancement applies to obstruction "during the investigation

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22

    5. The rule adopted by the Federal Circuit in these
cases is unprecedented; we have been unable to find
any ease from any other court recognizing a constitu-
tional right to make knowing and intentional false
statements with impunity.  The Federal Circuit
generally has the final say on employee disciplinary
matters.  See 5 U.S.C. 7513(d) (employees may appeal
adverse personnel actions to the MSPB); 5 U.S.C.
7703 (MSPB decisions on employee disciplinary mat-
ters appealable to Federal Circuit).  Accordingly, the
government is unlikely to have the opportunity to
litigate the issues in this case before any other court
of appeals.  See generally United  States v. Fausto, 484
U.S. 439,446-447 (1988).  Moreover, since the Federal
Circuit derived its rule from the Constitution, it
presumably cannot be altered through the issuance of
regulations or even through amendment of the civil
service statutes.  Because the Federal Circuit's deci-
sions in these cases conflict with decisions of this
Court and impose unjustified constitutional re-
straints on the government's ability to manage the
civil service system effectively, review by this Court
is warranted.

___________________(footnotes)

***  of the instant offense,"  including "providing a
materially false statement to a law enforcement officer that
significantly obstructed or impeded the official investigation or
prosecution of the instant offense") (emphasis added).

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APPENDIX A

UNITED STATES COURT OF APPEALS
FOR THE FEDERAL CIRCUIT'

Nos. 95-3745 and 95-3746

JAMES B. KING, DIRECTOR, OFFICE OF
PERSONNEL MANAGEMENT, PETITIONER

v.

LESTER E. ERICKSON, JR., RESPONDENT

and

JEANETTE M. WALSH, RESPONDENT

and

MICHAEL G. BARRETT AND JEROME K. ROBERTS,
      RESPONDENTS

and

SHARON KYE, RESPONDENT

and

MERIT SYSTEMS PROTECTION BOARD, RESPONDENT

[Decided July 16, 1996]

Before: RICH, LOURIE, and RADER, Circuit Judges.

LOURIE, Circuit Judge.

(la)

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2a

    The Director of the Office of Personnel Manage-
ment ("OPM") petitions for review of (1) the final
decision of the Merit Systems Protection Board
holding that an agency may not charge an employee
both with misconduct and with making false state-
ments regarding the alleged misconduct, Walsh v.
Department of Veterans Affairs, 62 M.S.P.R. 586
(1994), and (2) the final decisions of the board revers-
ing falsification charges based on its holding in
Walsh. Erickson v. Department of the Treasury, 63
M.S.P.R. 80 (1994); Kye v. Defense Logistics Agency,
64 M.S.P.R. 570 (1994); Barrett  v. Department of the
Interior, 65 M. S. P.R. 186 (1994). We affirm.

BACKGROUND

A. Walsh

     The Department of Veterans Affairs employed
Jeanette M. Walsh as a Social Services Assistant at
the agency's medical center in St. Cloud, Minnesota.
The agency removed her for engaging in a sexual
relationship with a patient, engaging in improper
financial dealings with patients, and providing false
statements to the agency regarding her alleged re-
lationship with a patient.  In particular, Walsh pro-
vided inconsistent statements regarding when her
relationship with the patient began and how long it
lasted.  In a December 1988 meeting with her super-
visor, Walsh acknowledged that she was having an
intimate relationship with the patient, who at the
time was no longer an in-patient.  However, in a
December 1991 affidavit, she averred that during the
December 1988 melting with her supervisor she
accurately denied having an intimate relationship
with the patient at that time.  In spite of this incon-
sistency, she always stated that she did not have an

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3a

intimate relationship with the patient while he was an
in-patient at the agency's facility from April 1988
until November 1, 1988.
    In an initial decision, an administrative judge (AJ)
found that the agency failed to prove the first two
charges.  Based on his findings regarding these
charges, the AJ did not uphold the third charge.  The
agency petitioned for review by the full board. The
board reversed the AJ's finding that the agency had
failed to prove the first two charges, but held that the
agency improperly charged Walsh with making false
statements regarding the alleged misconduct.  Rely-
ing on our decision in Grubka v. Department of the
Treasury, 858 F.2d 1570, 1575 (Fed. Cir. 1988), the
board held that an agency may not charge an em-
ployee both with misconduct and with making false
statements regarding the alleged misconduct.  The
board recognized that certain of its prior decisions
had held to the contrary.  Walsh, 62 M.S.P.R. at 594
(citing Greer v. United States Postal Serv., 43
M.S.P.R. 180, 184-85 (1990); Kane v. Department of
Veterans Affairs, 46 M.S.P.R. 203, 209 (1990); Ster-
ling v. Department of Defense, 46 M.S.P.R. 177,
185-86 (1990); Hornbuckle v. Department of the
Army, 45 M.S.P.R. 50, 54 n.2 (1990); Hill v. Depart-
ment of the Army, 44 M.S.P.R. 607, 611-12 (1990)).
However, the board also determined that those deci-
sions relied upon a faulty analysis of Grubka. In
Grubka, we stated that a falsification charge based
upon an employee's denial of misconduct "has no sub-
stance, is frivolous, and the decision of the AJ
sustaining it is not supported by substantial evidence
and is erroneous as a matter of law . . . ." Grubka, 858
F.2d at 1575.  The board in Walsh reasoned that,
because we used the conjunction "and" in our holding

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4a

in Grubka, two findings were made, one of which was
that the charge was erroneous as a matter of law.
According to the board, Grubka thus supports the
proposition that a separate charge of making false
statements regarding alleged misconduct is errone-
ous as a matter of law and is therefore improper.
    The board also stated that in Greer and its
progeny, it mischaracterized the due process con-
cerns enunciated in Grubka.  According to the board,
these concerns were not, as stated in previous board
decisions, based upon the Fifth Amendment right
against compulsory self-incrimination but, rather,
were based upon the due process right to be heard on a
charge and to not have a falsification charge auto-
matically sustained on the ground of sustaining the
related misconduct.  The board also determined that it
erred in Greer when it stated that, as an alternative
to providing false statements during an agency
investigation, an employee may simply refuse to
answer questions.  According to the board, such a
statement was contrary to precedential board deci-
sions and Federal Circuit  precedent; an employee may
be removed solely far refusing to answer questions
during an agency investigation if she is warned that
she may be removed for not answering and that her
statements cannot be used against her in a criminal
prosecution.  See Weston v. United States Dep't of
Hous. and Urban Dev., 724 F.2d 943, 949 (Fed. Cir.
1983); see also Haine v. Department of the Navy, 41
M.S.P.R. 462, 469 (1989).  Accordingly, the board
overruled Greer and its progeny to the extent that
their holdings were contrary to Grubka.
    The board mitigated Walsh's penalty to a 90-day
suspension.  In determining the appropriate penalty,
the board noted that it previously had held that an

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5a

employee's false statements may be considered in
determining a maximum reasonable penalty for mis-
conduct.  However, it stated that consideration of
false statements in determining a penalty would
conflict with the holding in Grubka and would in
effect penalize an employee for denying a charge.
Accordingly, the board held that an employee's
alleged false statements in response to an agency
inquiry may not properly be considered in determin-
ing a penalty.
    
B. Erickson

    The Department of the Treasury employed Lester
R. Erickson as a Supervisory Police Officer with the
Bureau of Printing and Engraving.  The agency re-
moved Erickson for conduct unbecoming a supervisor
and for making false statements in matters of official
interest.  The first charge was based on the agency's
allegation that Erickson encouraged an employee of
an agency contractor to make a "mad laugher" tele-
phone call to another agency police officer during
duty hours. The "mad laugher" calls were calls to
employees at their duty stations during which the
caller would laugh continuously and then hang up
without identifying himself or herself.
The falsification charge was based on Erickson's
denials that he participated in the "mad laugher"
calls. In particular, when responding to a list of
questions from an agency investigator, he made the
following allegedly false statements:
  
  Question 2: "Approximate the number of occa-
  sions you made 'Mad Laugher' calls and to
  whom by name?"
  Answer:  "None."

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6a      

Question 6: "Approximate time you quit par-
ticipating in `Mad Laugher' calls."
Answer:  "I never participated."

Question 9: "Specifically, how many times did
you ask your subordinates to cease the `Mad
Laugher' calls?"
Answer:  "None, [b]ecause I do not know who
is doing it."

Question 12: "Are you willing to specifically
state all those that are participants in the `Mad
Laugher' telephone calls."
Answer  "No-I do not know the. true
identification of the `Mad Laugher.' In my
opinion it is 95% of the police unit [and] also
possibly personnel in Production."

    In an initial decision, an AJ upheld both charges.
The agency provided a sworn statement and subse-
quent affidavit by the person who was allegedly
encouraged by Erickson to make one of the "mad
laugher" calls. The statement and affidavit affirmed
the truth of the charges, and the AJ found them to be
credible. The AJ also found that the agency had told
Erickson to refrain from making "mad laugher" calls
and that encouraging another to engage in such a
prank was disruptive to the agency's mission. Fur-
ther, based on the AJ's belief in the credibility of the
statements in the affidavit, as well as affidavits of
others, the AJ found that Erickson had knowledge of
and participated in the "mad laugher" calls and that
he made false statements when he denied such in-
volvement. The AJ also held that Erickson had not
established that the agency's action was based on an

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7a

alleged handicapping condition of alcoholism. Accord-
ingly, the AJ upheld the penalty of removal.
    Erickson petitioned for review by the full board.
The board determined that his petition did not meet
the criteria for review under 5 C.F.R.  1201.115;
however, it reopened the case on its own motion under
5 C.F.R. 1201.117. The board upheld the misconduct
charge. However, based on its Walsh decision, the
board reversed the falsification finding, stating that
the essence of the charge was Erickson's failure to
admit that he participated in "mad laugher" calls, and
that he was charged with encouraging another to
make such a call, not for his own alleged participation,
and that was a matter not within the agency's con-
cern. The board mitigated the penalty to a 15-day sus-
pension, stating that under its Walsh holding it would
not consider Erickson's allegedly false statements in
determining an appropriate penalty for the miscon-
duct.
    C. Kye
    
    The Defense Logistics Agency employed Sharon
Kye as a Supervisory General Supply Specialist at
the Defense Distribution Depot in Norfolk, Virginia.
The agency removed her for several offenses related
to alleged misuse of a Diners Club card that the
agency issued to her for use in official travel. The
agency also charged her with providing false informa-
tion in an official investigation based on her contra-
dictory statements regarding her use of the card
during the time in question.
In an initial decision, an AJ sustained most of the
charges relating to Kye's alleged misuse of the card.
The AJ also sustained the falsification charge, finding
that Kye provided false information regarding her

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8a

control over the card. during the time in question. In
particular, she initially replied to the charges by
stating that the card was missing from the drawer
where she kept it during the period of its alleged
misuse and that she tore it up when it reappeared.
During another interview, she stated that she tore up
the card about three  weeks earlier. Later, however,
she stated that she meant to say that she "confronted
the problem" about three weeks earlier but did not
regain control of the card until about two weeks later.
In addition, the agency claimed that she used the card
at a motel during the  time in question, and it produced
a copy of a signed registration form from the motel.
Kye stated in response that, although the signature
on the registration form resembled her own, she did
not recall being at the motel. The AJ found that
Kye's statements contained many improbabilities and
inconsistencies. For example, the AJ found that in
order to believe Kye's statements that she may have
used the card, he would have had to disbelieve her
statements that she lost control of the card. The AJ
also found that she had not met her burden of proof on
her affirmative defenses of discrimination for making
a protected disclosure and for a handicapping condi-
tion. Accordingly, the AJ found that Kye provided
false statements to the agency, and he upheld the
penalty of removal.
    Kye petitioned for review by the full board. The
board analyzed her affirmative defense of handicap
discrimination and found that it lacked merit. Based
on its decision in Walsh, the board summarily re-
versed the falsification charge and mitigated the
penalty to a 45-day  suspension.      

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9a

D. Barrett and Roberts
    The Department of the Interior, Bureau of Indian
Affairs, employed Michael G. Barrett and Jerome K.
Roberts as Soil Scientists at the Natural Resources
and Engineering Laboratory in Gallup, New Mexico.
The agency alleged that they left work during duty
hours to help their supervisor build a fish pond at his
home. The agency charged them with making a false
claim on a time and attendance report based on their
1.5 hours of claimed duty time when they were
allegedly building the fish pond; failing to report an
act of fraud, waste, and abuse consisting of their
supervisor's alleged misconduct; and misrepresenta-
tion or concealment of a material fact in connection
with an agency investigation.  According to the
agency, they provided false information in response to
the agency's inquiry. Roberts stated that he did not
remember building a fish pond, and Barrett stated
that he only worked on the fish pond on his own time.
The agency demoted both and suspended them for 30
days. In an initial decision, an AJ sustained all
charges and upheld the penalties. With respect to the
falsification charge, the AJ found that Barrett and
Roberts stated in response to agency questionnaires
that they knew nothing of the events in question.
Based on the testimony of others, the AJ found by a
preponderance of the evidence that Barrett and
Roberts were at their supervisor's house during the
time in question and therefore that their statements
to the contrary were false.
    Barrett and Roberts petitioned for review by the
full board, which vacated and remanded the AJ's
initial decision.  On remand, the AJ upheld the
agency's action, and Barrett and Roberts again peti-

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tioned for review by the full board.  Based on its
decision in Walsh, the board reversed the holdings of
falsification and of failing to report an act of fraud,
waste, and abuse.  According to the board, requiring
Barrett and Roberts to report their supervisor's
alleged misconduct would have necessitated implicat-
ing themselves in the misconduct of filing a false time
and attendance report, and such self-implication was
contrary to its holding in Walsh.  The false time and
attendance report charges were sustained; they are
not before us in this appeal.  The board also mitigated
the penalties to letters of reprimand.

DISCUSSION

    We may reverse a decision of the board only if it
was arbitrary, capricious, an abuse of discretion, or
unlawful; procedurally deficient; or unsupported by
substantial evidence.  5 U.S.C.  7703(c) (1994);
Cheeseman v. Office of Personnel Management, 791
F.2d 138, 140 (Fed. Cir. 1986), cert. denied, 479 U.S.
1037 (1987).
    Under the Fifth Amendment, "No person shall . . .
be deprived of... property, without due process of law
. . . . " U.S. CONST. amend. v. Procedural due pro-
cess under the Fifth Amendment protects federal
employees when they obtain a statutorily-created
property interest in their employment.  Board of
Regents v. Roth, 408 U.S. 564, 577-78 (1972) (stating
that property interests are not created by the Con-
stitution, but, rather, are created by existing rules or
understandings).  It is undisputed that the govern-
ment employees here had a protected property inter-
est in their employment.  See 5 U.S.C. 7513 (1994).
Federal workers who meet the definition of  "em-
ployee, 5 U.S.C. 7511, are entitled to the following

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procedures protecting their property interests in
their continued employment
    An employee against whom an action is proposed is
entitled to-
         (1) at least 30 days' advance written notice . . .
         stating the specific reasons for the proposed
         action;
         (2) a reasonable time, but not less than 7 days,
          to answer orally and in writing and to furnish
          affidavits and other documentary evidence in
          support of the answer;
         (3) be represented by an attorney or other
          representative; and
         (4) a written decision and the specific reasons
          there for at the earliest practicable date.
    5 U.S.C.  7513(b) (1994). Section 7513 also states
that actions will be taken against an employee "only
for such cause as will promote the efficiency of the
service."  Id.  7513(a).  When an agency brings
charges against an employee, compliance with these
procedures satisfies the minimum due process re-
quirements to which the employee is entitled.  The
agency may then deprive the employee of his property
interest in continued employment when he has been
shown to have failed to perform his job properly or
engaged in reprehensible conduct.  See Cleveland Bd.
of Educ. v. Loudermill, 470 U.S. 532, 546 (1985) (stat-
ing that the essential requirements of due process
are notice and a meaningful opportunity to respond).
While it is clear that the procedures set out in the
statute provide an employee with procedural due
process, the question before us is whether doubling

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12a

up a misconduct charge with a charge of falsification
in the course of the agency's investigation of the
misconduct deprives the employee of the due process
that the statute intends.  We hold that it does.
    OPM argues that the employees here were given all
the procedural rights due them under 5 U.S.C. 7513.
OPM asserts, therefore, that it was not improper for
the agencies to charge the employees with falsifica-
tion based on their denials of facts related to the
corresponding misconduct charges.
    OPM argues that the-statements in Grubka relied
upon by the board are dicta and that therefore the
board's holding in Walsh is not in accordance with
law.  The employees, on the other hand, argue that the
relevant  statements are not dicta; further, they argue
that a reversal of Walsh would cause agencies to auto-
matically charge employees with falsification when
the employees deny charges of misconduct.  The
board, as respondent, argues that if we determine that
the statements in Grubka are dicta we should remand
for further consideration by the board.
    In Grubka, we reversed a falsification charge that
was based upon an employee's statements regarding
his alleged misconduct. Grubka held a managerial PO-
sition with the Internal Revenue Service, which
charged him with conduct unbecoming an employee in
a managerial position for allegedly "embracing and
kissing a female trainee at an off-duty hours Hallow-
een party.  Grubka, 858 F.2d at 1572-73.  The agency
also charged him with falsification, stating
    Reason II: You made a false statement in a matter
    of official interest.
         Specification 1: On December 12, 1986, during
         an interview conducted by Mr. Curtis S.

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      Jenkins and Ms. Eileen Collins, you denied
      kissing female Revenue Agent Harriet Novak
      on the mouth in a stairwell outside the room in
      which a party was being held at the Hilton
      Hotel, Buffalo, N.Y., on October 30, 1986. You
      then executed a written statement to that
      effect.  This statement was false in that you did
      kiss Ms.  Novak at the Hilton Hotel on that date.
 Id. at 1574.  The board sustained the falsification
charge.  We reversed the board's decision, stating
      It has always been the rule and practice that a
      person charged with an offense can deny the
      charge and plead not guilty, either because he is
      not guilty or to force the charging party to
      prove the charge, and, regardless of the out-
      come, the denial is not itself a separate offense.
      Otherwise, a person could never defend himself
      against a charge, even though frivolous, for fear
      of committing another offense by denying the
      charge.  The decision of the AJ denied Grubka
      his due process rights in that it denied him the
      right to a trial on the charge without due pro-
      cess of law.
   Id. at 1575.
    We do not agree that these statements are dicta.
The word "dicta" is an abbreviation for obiter dicta
(the singular being obiter dictum or, more commonly,
dictum), which are "[w]ords of an opinion entirely
unnecessary for the decision of the case." BLACK'S
LAW DICTIONARY 1072 (6th ed. 1990).  They in-
clude a "remark made, or opinion expressed, by a
judge, in his decision upon a cause, 'by the way,' that
is, incidentally or collaterally, and not directly upon
the question before him, or upon a point not necessar-

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14a

ily involved in the determination of the cause, or in-
troduced by way of illustration, or analogy or argu-
ment." Id.; see Kastigar v. United States, 406 U.S.
441, 454-55 (1972) (stating that broad language in an
opinion unnecessary for the decision cannot be con-
sidered binding authority); Smith v. Orr, 855 F.2d
1544, 1550 (Fed. Cir. 1988) ("[I]t is well established
that a general expression in an opinion, which expres-
sion is not essential to the disposition of the case,
does not control a judgment in a subsequent proceed-
ing.")
    In dismissing the falsification charge in Grubka,
this court's reasons as stated in its opinion for doing
so were not dicta because they were essential to the
decision in question.  They were necessary to support
the holding that "the [falsification] charge has no
substance, is frivolous, and the decision of the AJ
sustaining it is not supported by substantial evidence
and is erroneous as a matter of  law, and is set aside."
Grubka, 858 F.2d at 1575 (emphasis added).  One of the
holdings was that the falsification charge was con-
trary to law, the above-quoted passage from Grubka
was necessary to support that holding and it was
therefore not dictum.  See Woods v. Interstate Realty
Co., 337 U.S. 535, 537 (1949) (stating that alternative
holdings are not dicta); see also Beverly v. United
States Postal Serv., 907 F.2d 136, 137 (Fed. Cir. 1990)
(stating that an AJ properly dismissed a falsification
charge that was based on the petitioner's denial that
she was at a football game, explaining that it was a
mere denial of the misconduct charges and should not
have been stated as a separate offense).  Thus, Grubka
is binding onus and on the Merit Systems Protection
Board.

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15a

The facts of Grubka indicate that its holding was
that an employee's denial of the factual basis of a
charge may not be used as the basis for a falsification
charge.  Not only did Grubka deny the misconduct
charge, conduct unbecoming an employee, he also
denied kissing the trainee on the date in question,
thereby denying the underlying facts related to the
misconduct charge.  Grubka, 858 F.2d at 1574. In par-
ticular, when interviewed by an agency representa-
tive, Grubka denied "kissing female Revenue Agent
Harriet Novak on the mouth in a stairwell outside the
room in which a party was being held at the Hilton
Hotel, Buffalo, N.Y., on October 30, 1986."  He also
executed a written statement to that effect. Grubka
thus specifically denied the facts underlying the mis-
conduct charge.  We explained in Grubka that, never-
theless, "the AJ held by circuitous reasoning that
proof by Novak that Grubka kissed her ipso facto
proved that his denial was false and therefore, his
denial was a separate offense as charged." Id.  We
stated that this was improper because the "effect of it
is to hold that a denial of a charge itself becomes a
separate proven offense if what is denied is proven to
be true."  Id. at 1574-75.
OPM also argues that the relevant statements in
Grubka should be considered dicta because, according
to OPM, the due process issue was not fully briefed to
the court in that case.  OPM cites Church of the
Lukumi Babalu Aye, Inc. v. City of Hialeah, 508
U.S. 520,572-73 (1993) (Souter, J., concurring).  How-
ever, a rule announced without full briefing does not
necessarily lack precedential weight. See id. at 573
(Souter, J., concurring).  Moreover, the due process
issue has been briefed in this case, along with the

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16a

issue concerning whether the relevant statements in
Grubka are dicta.
    OPM would have us draw a distinction between
denying a charge and denying the underlying facts
related to the charge.  While agreeing that an em-
ployee obviously may deny a charge, OPM argues that
an employee's denial of underlying facts should
properly provide a basis for a falsification charge.  We
do not agree.  A denial of underlying facts is in effect
a denial of the charge that they support. Allowing an
agency to charge an employee with falsely denying
facts underlying a misconduct charge would deprive
the employee of a meaningful opportunity to respond
to the charges.
    Drawing a law-fact distinction, as OPM would have
us do, would require employees not trained in the law
to distinguish between a legal statement of miscon-
duct and the facts which define the misconduct. If
this were permitted, employees might be reluctant to
deny charges for fear that their denials would be
construed as denials of facts, which in OPM's view
would subject them to an additional falsification
charge, providing a more severe penalty than a mis-
conduct charge.  In the cases before us, the falsifica-
tion charges resulted in penalties of removal or
demotion, whereas the misconduct charges alone,
once the falsification charges were reversed at the
board, resulted in penalties only of suspension or
letters of reprimand.  If agencies were allowed to in-
form employees under investigation for misconduct
that their denial of facts may subject them to an
additional falsification charge, they may be coerced
into admitting the misconduct, whether they believe
that they are guilty or not, in order to avoid the more
severe penalty of removal possibly resulting from a

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17a

falsification charge.  This dilemma might leave them
without a meaningful opportunity to respond or
provide a defense to the charges.  It would create a
"chilling effect" on their clear right to defend them-
selves, a "Catch-22" situation for employees that is
inconsistent with the due process right provided by
federal law to enable them to defend themselves.
    Moreover, because memories are often faulty,
responses to questions may not always be accurate.
To render such statements constituting denials as
actionable falsehoods might too readily transform
credibility determinations into separate charges of
falsification.
    This does not mean, however, that an employee has
a right to lie or affirmatively mislead an agency
engaged in an investigation.  See Bryson v. United
States, 396 U.S. 64, 72 (1969) ("Our legal system
provides methods for challenging the Government's
right to ask questions-lying is not one of them.").
Beyond a denial of a charge or of the factual accusa-
tions supporting a charge, an employee may not make
up a false story, or tell "tall tales" in order to defend
against a charge.  Such falsehoods which go beyond
denial and defense are actionable by an agency as
falsification.  For example, if an agency questions an
employee regarding alleged misconduct that occurred
in Washington, D. C., and the employee -responds that
he was in Boston at the time, when in fact he was not,
that is a falsification that can constitute the basis for
a charge independent of the charge of misconduct.  For
another example, if an agency questions an employee
regarding a government-owned television set' alleg-
edly stolen from the workplace and found at his home,
and the employee responds that he bought the set
himself when in fact he did not, that similarly would

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be a falsification separately chargeable.  Moreover,
when the agency is in an investigatory mode, prior to
charges having been brought, the agency is entitled
to truth-telling by its employees.  Similarly, when
investigations are conducted concerning the conduct
of other employees, false statements are actionable.
These examples hardly exhaust the situations in
which an agency may charge an employee with mak-
ing a false. statement.
    As further support for its position, OPM cites our
decisions in Gonzales v. Defense Logistics Agency,
772 F.2d 887 (Fed. Cir. 1985) and Ahles v. Department
of Justice, 768 F.2d 327 Fed. Cir. 1985).  The employ-
ees in these cases were charged with both misconduct ,
and altering documents to conceal their misconduct.
    OPM argues that the principle underlying these
cases and Grubka and Walsh is the same, stating that
"[i]f employees can be charged with misconduct and
with falsifying documents to conceal their miscon-
duct,' as was done in Gonzales and Ahles, then it
should be equally true that employees can be charged
with misconduct and with making oral false state-
ments to conceal their misconduct." Altering docu-
ments, however, goes beyond denial and consists of
affirmative acts to mislead the agencies.  These deci-
sions thus do not support OPM's position.
    OPM also argues that Grubka is contrary to an
employee's obligation to cooperate and answer truth-
fully in agency investigations, citing 5 C.F.R. 5.4.
That regulation states  in pertinent part:
    When required by the Office, the Merit Systems
    Protection Board, or the Special Counsel of the
    Merit Systems Protection Board, or by
    authorized representatives of these bodies,

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19a

     agencies shall make available to them, or to
     their authorized representatives, employees to
     testify in regard to matters inquired of under
     the civil service laws, rules, and regulations,
     and records pertinent to these matters.  All
     such employees, and all applicants or eligibles
     for positions cover ed by these rules, shall give
     to the Office, the Merit Systems Protection
     Board, the Special Counsel, or to their author-
     ized representatives, all information, testimony,
     documents, and material in regard to the above
     matters, the disclosure of which is not other-
     wise prohibited by law or regulation.
5 C.F.R. 5.4 (1995).  We do not agree.  OPM's posi-
tion, if accepted, would have the effect of requiring
employees to assist in proving the charges brought
against them.
    The burden is on an agency to prove charges
against an employee.  See 5 U.S.C.  7701(c) (1994);
Jackson v. Veterans Admin., 768 F.2d 1325, 1329
(Fed. Cir. 1985) (stating that an agency has the bur-
den of proof and the burden of persuasion in establish-
ing the factual basis for misconduct).  An agency has
means to prove charges other than through admis-
sions or denials of an employee under investigation.
While it might be easier for an agency to prove a
charge by using the leverage of an added charge of
falsification to compel admissions, due process re-
quires that an employee be allowed to deny both a
charge and the underlying facts without being subject
to a falsification charge.  Accordingly, while an em-
ployee has no right to lie or make a false statement to
an agency, an employee's mere denials of charges and

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20a

their underlying facts may not be used by an agency
as a basis for a falsification or similar charge.
    OPM argues that the Fifth Amendment right
against compulsory self-incrimination does not re-
quire a right of denial.  As discussed above, however,
the board did not err in determining that the holding
in Grubka was based on procedural due process
concerns.  The Fifth Amendment right against com-
pulsory self-incrimination is not dispositive of the
issue here.
    Finally, OPM argues that the board erred in
interpreting Grubka to prohibit consideration of an
employee's alleged false statements in a penalty
determination.  In Walsh, the board declined to con-
sider Walsh's denial of the charges and related facts
as justification for an enhanced penalty. In support of
its position, OPM cites United States v. Dunnigan,
507 U.S. 87 (1993).  The defendant in Dunnigan was
convicted of conspiracy to distribute cocaine.  Her
sentence was enhanced because the trial court found
that she committed perjury.  She appealed to the
Fourth Circuit, which affirmed the conviction but
vacated her sentence, holding that the relevant
sentencing guideline was unconstitutional, and rea-
soning that otherwise "every defendant who takes the
stand and is convicted [would] be given the obstruc-
tion of justice enhancement." United States v. Dun-
nigan, 944 F.2d 178, 183 (4th Cir. 1991), rev'd, 507
U.S. 87 (1993).  On review by the Supreme Court,
Dunnigan argued that enhancing her sentence
because of perjury interfered with her right to
testify.  The Court disagreed, stating that a defen-
dant's right to testify does not include a right to
commit perjury.  Dunningan, 507 U.S. at. 96. Like-
wise, beyond their right to deny charges brought

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21a

against them and to deny facts supporting the
charges, federal employees have no right to lie or
make false statements to the government, and such
false statements made during agency investigations
and relating to alleged misconduct may properly be
subject to separate falsification charges, which pro-
vide their own penalty if the requisite elements of the
charge are proven.
    However, Dunnigan does not provide an agency
with the right to make dual charges of misconduct
and falsification.  That case only dealt with enhance-
ment of a sentence in a criminal context, where there
is a heavier burden of proof than agencies have in
proving charges of falsification against employees.
Moreover, the crime of perjury consists of lying
under oath, a much more serious offense than viola-
tion of 5 C.F.R.  5.4, thereby justifying a penalty
beyond that levied on the basic offense.  Thus, Dun-
nigan is not controlling here.  In any event, if a
falsification charge may not be added to a misconduct
charge on the basis of mere denials, one can hardly
justify enhancing a misconduct penalty because of
such asserted falsification.
    In sum, we hold, consistently with Grubka, that an
agency may not charge an employee with falsification
or a similar charge on the ground of the employee's
denial of another charge or of underlying facts relat-
ing to that other charge.  However, employees do not
otherwise have a right to lie or make false factual
statements to an agency, and such false statements
made during agency investigations and relating to
alleged misconduct may properly be subject to
falsification or similar charges.  Denials of charges
and related facts may not be considered in determin-
ing a penalty.

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22a

    In light of our holding here and the clarification of
our holding in Grubka, we will now review whether
the board's decisions in not sustaining the particular
falsification charges before us were arbitrary, capri-
cious, an abuse of discretion, or unlawful; proce-
durally deficient; or unsupported by substantial evi-
dence.  See 5 U.S.C.  7703(c) (1994).  In Walsh, the
alleged inconsistent statements related to Walsh's
initial acknowledgement of having an intimate re-
lationship with the patient when he was not an
in-patient, and her subsequent denial of that fact.
However, she consistently denied having an intimate
relationship with the patient while he was an
in-patient at the agency's facility.  Her admission of
having an intimate relationship with the patient was
not a false statement, as the board found that she did
have an intimate relationship with him from time to
time while he was not an in-patient.  Her other state-
ments are mere denials of having an intimate
relationship with the patient.  Therefore, the board
did not err in refusing to sustain the falsification
charge against Walsh.
    In Erickson, it was his denials of having knowledge
of or participating in the "mad laugher" calls that
formed the basis for the falsification charges.  He was
charged with conduct unbecoming a supervisor for
encouraging another to make one of the "mad
laugher" calls, and his statements, as they related to
the alleged misconduct, were denials of having en-
gaged in such conduct; they were thus not otherwise
false.  Therefore, the board did not err in reversing
the falsification charge against Erickson.
    In Kye, it was Kye's statements regarding whether
or not she had control of her Diners Club card during
the time in question that formed the basis of the

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23a

falsification charge against her.  While she may have
provided ambiguous statements regarding her control
of the card, she consistently denied using the card
during the time in question.  She also testified that
she suspected her son used the card during the time
in question.  This statement is consistent with her
statement that she may have lost control of the card
and it is also consistent with her denial of using the
card.  Further, she did not affirmatively state that
someone else used the card; rather, she stated her
belief that her son may have used it.  Her statements
in effect were thus denials and were not actionable
false statements.  Therefore, the board did not err in
dismissing the falsification charge against Kye.
    In Barrett, it was Barrett's and Roberts' denial of
alleged misconduct that formed the basis for the
falsification charges.  In answering an investigator's
questionnaire, both indicated that they knew nothing
of the events in question.  That was in essence a de-
nial and was not otherwise false.  Therefore, the board
did not err in reversing the falsification charges
against Barrett and Roberts. Falsifying time cards is
another matter, but it is not before us.

CONCLUSION

    The board's decisions in Walsh, Erickson, Kye, and
Barrett are affirmed.
    
   AFFIRMED.

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APPENDIX B

UNITED STATES COURT OF APPEALS
FOR THE FEDERAL CIRCUIT

No. 96-3028

JAMES B. KING, DIRECTOR
OFFICE OF PERSONNEL MANAGEMENT, PETITIONER

v.

HARRY R. McMANUS, RESPONDENT
AND
MERIT SYSTEMS PROTECTION BOARD, RESPONDENT

Decided: July 22,1996

Before: RICH, LOURIE, and RADER, Circuit
   Judges. 

LOURIE, Circuit  Judge.

DECISION

    The Director of the Office of Personnel Manage-
ment ("OPM") petitions for review of the board's final
decision in  McManus v. Department of Justice, 66
M.S.P.R. 564 (1995), reversing a falsification charge
based upon its holding in Walsh v. Department of
Veterans Affairs, 62 M.S.P.R. 586 (1994).  We  affirm.

DISCUSSION

    The Department of Justice ("the agency") employed
Harry R. McManus as a Lieutenant. The agency de-

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25a

meted him to the position of Correctional Officer,
charging him with (1) conduct unbecoming a supervi-
sor based upon sexual comments that he made to one
of his subordinates, Corrections Officer Judith White,
and (2) making false statements during an official
investigation.  In an initial decision, an administra-
tive judge ("AJ") found that when McManus was in-
terviewed during the agency's investigation he
admitted making sexual comments to White.  Even
though the comments were often made in an atmos-
phere in which workers voluntarily participated,
the AJ found this to be unsuitable conduct for a
supervisor and he therefore sustained the misconduct
charge.
    The AJ found that McManus made the following
false statements during the agency's investigation:

(1) during the interview on October 29, 1993
(interview 1), the appellant responded that he
never told Officer White that he was disappointed
that she did not call during the evening they were
on duty together; during the interview on Novem-
ber 19, 1993 (interview 2), he responded that he had
called Officer White and told her that he was
disappointed that she had not called;

(2) during interview 1, the appellant stated that
he never said he would have Officer White relieved
so that she could come over to FCI and tease him
more; during interview 2, however, the appellant
stated that maybe he had stated he would have
Officer White relieved;

(3) during interview 1, the appellant stated that
he never asked Officer White why she had not
traded posts with Officer Smith so that she

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26a

     (Officer White) could be closer to him at FCI;
     during interview 2, he stated that, indeed, he may 
     have asked her this;

     (4) during interview 1, the appellant flatly denied
     discussing the subject of preferred sexual posi-
     tions with Officer White; during interview 2, the
     appellant responded that he asked the appellant
     [sic], "What (positions) do you like?";

     (5) during interview 1, the appellant flatly denied
      ever discussing Officer White accompanying him
      on a WITSEC trip; however, during interview 2,
      the appellant stated that he had asked her to
      accompany him; and

     (6) during interview 1, the appellant denied that
     he told Officer White that he had a bulge (in his
     pants) while talking with her; during interview 2,
     the appellant responded, "Can you see how much
     you excite me?" (referring to the bulge in his
     pants).

When questioned about these inconsistent statements
during his oral reply to the agency's notice, McManus
stated that he may have "skirted the issue" in an
attempt to end the investigation and that his re-
sponses during the second interview were simply
elaborations of his first responses.  The AJ found that
McManus's explanation was not credible and that he
intentionally made false statements to the agency
during its investigation. Therefore, the AJ sustained
the falsification charge.
However, the AJ found that the agency's penalty of
demotion exceeded the tolerable bounds of reasonable-
ness. The AJ found that McManus's cements were

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27a

mostly delivered in jest among willing participants,
including White, who initiated the comments on more
than one occasion.  With respect to the falsification
charge, the AJ considered that McManus ultimately
told the truth regarding the misconduct. The AJ also
considered that McManus had eleven years of service
without any prior discipline.  Accordingly, the AJ
mitigated the penalty to a fourteen-day suspension.
    The agency petitioned the full board for review.
The board denied the petition as failing to meet the
criteria for review under 5 C.F.R.  1201.115; how-
ever, it reopened the appeal on its own motion under 5
C.F.R. 1201.117.  Based upon its decision in Walsh,
in which it held that an agency may not charge an
employee both with misconduct and with making false
statements regarding the alleged misconduct, the
board reversed the falsification charge against Mc-
Manus.  The board sustained the misconduct charge
and found that the AJ did not err in mitigating the
penalty.  Accordingly, the board affirmed the initial
decision as modified and sustained the mitigation of
the penalty to a fourteen-day suspension.  OPM now
appeals.
    OPM argues that the board's holding in Walsh is
not in accordance with law.  According to OPM, the
board in its Walsh decision relied upon dicta in
Grubka v. Department of the Treasury, 858 F.2d
1570, 1575 (Fed. Cir. 1988).  We recently addressed the
same issue in King v. Erickson, Nos. 95-3745, 95-3746
(Fed. Cir. July 16, 1996).  In Erickson, we stated that
the statements in question in Grubka were not dicta,
and we held that "an agency may not charge an
employee with falsification or a similar charge on the
ground of the employee's denial of another charge or

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28a

of underlying facts relating to that other charge."
Erickson, slip op. at 22.
    We review whether the board's decision in re-
versing the falsification charge against McManus
was arbitrary, capricious, an abuse of discretion, or
unlawful; procedurally deficient; or unsupported by
substantial evidence.  See 5 U.S.C. 7703(c) (1994).
Each of McManus's responses alleged to be false
statements was essentially a denial of the misconduct
under investigation.  During the agency's first inter-
view, he stated that he never said the statements in
question or he denied having said them.  During the
second interview, he stated substantially the opposite.
Under our holding in Erickson, we must conclude
that the first responses were within the range of
denials that must be permitted in order to make
meaningful the right to respond to charges; they were
therefore not separately-actionable `false statements.
Accordingly, the bead did not err in reversing the
falsification charge against McManus.  OPM has not
appealed the issue of mitigation of the penalty, and we
therefore do not address it.

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APPENDIX C

UNITED STATES OF AMERICA
MERIT SYSTEMS PROTECTION BOARD

   No. CH-0752-92-0021 -I-1

JEANETTE M. WALSH, APPELLANT

v.

DEPARTMENT OF VETERANS AFFAIRS, AGENCY

[MAY 31, 1994]

OPINION AND ORDER

    Before: BEN L. ERDREICH, Chairman, JESSICA L.
PARKS, Vice Chairman, and ANTONIO C. AMADOR,
Member.
    Chairman ERDREICH issues  a concurring opinion.

    The agency petitions for review of the initial
decision reversing the appellant's removal from her
position as a GS-6 social services assistant at the
agency's St. Cloud, Minnesota Medical Center. For
the reasons set forth below, we GRANT the petition
for review, REVERSE the initial decision in part,
AFFIRM the initial decision in part, and mitigate the
penalty to a 90-day suspension.

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30a

BACKGROUND

    The agency based its removal action on three
charges: (1) Engaging in an intimate sexual relation-
ship with an alcohol-dependent patient, Richard
Brown; (2) engaging in improper financial dealings
with Brown and another patient; and (3) providing
false statements to the agency concerning her rela-
tionship with Brown.  Agency File, Tab 4h; see also
Initial Appeal File (IAF), Tab 11.
    After allowing the parties to submit written
evidence, 1.  the administrative judge found that the
first and second charges could not be upheld.  He
found that the agency failed to prove that the appel-
lant had engaged in an intimate sexual relationship
with Mr. Brown while he was undergoing treatment
at the medical center, that certain products one
patient apparently purchased were purchased from
the appellant rather than from her sister, or that the
other person with whom the appellant allegedly had
financial dealings was a patient at the time of the
alleged dealings.  The administrative judge declined
to uphold the third charge largely on the basis of his
findings concerning the first and second charges.  He
therefore ordered the agency to cancel the appellant's
removal.
    In its petition for review, 2.  the agency argues that
the administrative judge erred in finding that it failed
to establish that the appellant was involved in an

___________________(footnotes)

    1.  The appellant did not request a hearing, and thus the
administrative judge rendered his decision based on the written
record.
    2. The agency has provided evidence of compliance with
the administrative judge's interim relief order sufficient to
meet the requirements of 5 C.F.R.  1201.115(b).

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31a

intimate sexual relationship with Mr. Brown while he
was an in-patient and an out-patient at the medical
center.  It points to several alleged inconsistencies in
the appellant's statements regarding her relationship
with Mr. Brown, and asserts that the administrative
judge erred in finding the appellant's statements
concerning the relationship to be more specific and
consistent than Mr. Brown's statements that he and
the appellant had an intimate relationship while he
was a patient at the St. Cloud facility.  The agency
argues that the administrative judge further erred in
finding that it had failed to establish that the appel-
lant provided false or misleading information when
she denied having an intimate relationship with Mr.
Brown while he was a patient and in finding that it
had failed to establish that she concealed a fact in
connection with the agency's inquiry into the matter
by persuading Mr. Brown to conceal his relationship
with her. 3.

ANALYSIS

    Contrary to the administrative judge's finding,
the agency did prove that the appellant had an
intimate sexual relationship with Mr. Brown while
he was an in-patient at the medical center.

    The agency's assertion that the appellant has
provided inconsistent explanations of the length of
her relationship with Mr. Brown is correct. In an
affidavit dated December 30, 1991, the appellant stated
that she had sexual relations with Mr. Brown three
or four times in the summer of 1989. Appeal File, Tab

___________________(footnotes)

    3. The agency has not challenged the administrative judge's
findings regarding any of the other specifications on which the
removal was based.

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32a

9. In her statement to agency investigators, however,
she asserted that she had an intimate relationship
with Mr. Brown for approximately a year and half,
beginning in November of 1988. Agency File, Tab 4k
at 5.  The appellant also acknowledged in that state-
ment that, when she met with her supervisor in
December of 1988-when Mr. Brown was no longer an
in-patient-she was having a relationship with him.
Id. at 9-10.  In her December 30, 1991 affidavit, how-
ever, she stated that, during the December 1988
meeting with her supervisor, she correctly denied
having an intimate relationship with Mr. Brown at
the time of the meeting.  Appeal File, Tab 9.  Thus,
the appellant's statements regarding when her rela-
tionship with Mr. Brown started and how long it
lasted are inconsistent.  Despite these inconsisten-
cies, however, the appellant has consistently stated
that she did not have an intimate relationship with
Mr. Brown while he was an in-patient at the medical
center from April of 1988 until November 1, 1988.
    The agency argues, in effect, that the inconsisten-
cies in the appellant's statement discredit that state-
ment, and that, once the statement of a witness has
been discredited on one issue or charge, an adminis-
trative judge may not accept the statement of the
same witness on other charges unless he provides
some reasoned explanation of that acceptance.  See
Petition for Review at 4.  The latter part of this argu-
ment is supported by the Board decision on which the
agency relies, Sternberg v. Department of Defense,
41 M.S.P.R. 46, 54 (1989).  That case also states, how-
ever, that an administrative judge is not required to
discredit all of the statement of a witness when some
of the statement is discredited, but if some of the
statement is to be found credible, the administrative

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33a

judge must provide a reasoned explanation. Id.  In
this case, the administrative judge did not address the
inconsistencies in the appellant's various explana-
tions, and he did not discuss why some of the
appellant's statements are credible while others are
not.  This failure warrants Board review since, as dis-
cussed below, the appellant's statements are in con-
trast with Mr. Brown's statements.  See Weaver v.
Department of the Navy, 2 M.S.P.R. 129, 133 (1980)
(in reviewing an initial decision, the Board is free to
substitute its own determinations of fact for those of
the administrative judge, giving his findings only as
much weight as may be warranted by the record and
by the strength of his reasoning), review denied, 669
F.2d 613 (9th Cir. 198.2) (per curiam).
    The agency's investigation into the appellant's
relationship with Mr. Brown was initiated as a result
of a letter to the agency from Mr. Brown's wife,
Donna. 4.  In that letter, Mrs. Brown complained that
the staff at the medical center had determined that
her husband should be admitted to the agency's
Kennic Falls, Wisconsin, facility, and not the St.
Cloud facility, because of his previous relationship
with the appellant. Mrs. Brown had no direct evi-
dence regarding her husband's relationship with the
appellant, however; her subsequent statement to
agency investigators was based entirely on Mr.
Brown's statements to her about the relationship..
See Agency File, Tab 4s. Although hearsay evidence
is admissible in Board proceedings, the probative
value of Mrs. Brown's statement is slight because of

___________________(footnotes)

    4 Richard and Donna Brown were not married at the time
of the appellant's relationship with Mr. Brown; they did not
meet until April of 1990. Agency File, Tab 4k at 11.

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34a

her lack of direct knowledge and the fact that Mr.
Brown-the source of her knowledge-also provided a
statement.  Borninkhof  v. Department of Justice, 5
M.S.P.R. 77, 83-87 (1981) (assessment of the probative
value of hearsay evidence necessarily depends on the
circumstances of each case).  Further, Mrs. Brown's
statement that her husband was sent to the Kennic
Falls, Wisconsin, facility because of his prior re-
lationship with the appellant is not supported by the
statements of  Mr. Brown's treating therapists, coun-
selors, and social workers.  They stated that Mr.
Brown was admitted to the Kennic Falls facility
based on their assessment of his clinical needs, an
assessment that was unrelated to the appellant's
presence at the St. Cloud facility.  Agency File, Tabs
41 at 1-2 (statement of James Broda), 4n at 3 (state-
ment of John Pucel), 4m at 1 (statement of Siri Kraw-
chuk), 40 at 1-2 (statement of Iran Oberman), and 4t
at 1 (statement of Ronald Williams).
    To support its allegation that the appellant was in-
volved in an intimate sexual relationship, the agency
relied extensively on Mr. Brown's statement to the
investigators.  He maintained in his statement that
he became involved with the appellant in September of
1988, that the relationship lasted six or seven months,
and that they had sexual relations almost every
weekend from mid-September 1988 until his discharge
from the medical center in November of 1988.  See
Agency File, Tab 4j at 1 and 6.  He also maintained
that he lied to the appellant's supervisor in December
of 1988, in order to protect the appellant, when he told
the supervisor that he knew the appellant in North
Dakota in the early 1980s and refused to disclose to
the supervisor the existence of the relationship. Id.
at 2 and 7-8.

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35a    

    Mr. Brown's statement is bolstered by the joint
statement of his Alcoholics Anonymous sponsors,
Dale and Linda Willet.  The Willets corroborate Mr.
Brown's statement that the appellant and Mr. Brown
were friends and that Brown at least occasionally
would spend weekends at the appellant's home in the
autumn of 1988, but they both admitted that they did
not know whether Mr. Brown and the appellant en-
gaged in sexual relations while he was an in-patient.
See Agency File, Tab 4r at 3-4.
    Contrary to the administrative judge's finding that
Mr. Brown's statements were "general and inconsis-
tent," Initial Decision at 9, we find Mr. Brown's
statement about his relationship with the appellant to
be consistent and detailed. Mr. Brown provided sig-
nificant details about his relationship with the
appellant and specifically described the interior of her
home. See Agency File, Tab 4j.  While his statement
is inconsistent with an earlier statement to the
appellant's supervisor, Mr. Brown explained that he
refused to disclose the relationship in an effort to
protect the appellant. Id. at 7-8.  Although the
Willets' limited knowledge is of little probative value,
it does lend some support to Mr. Brown's assertion
that he was involved in a relationship with the appel-
lant. 5

___________________(footnotes)

    5  The administrative judge discredited the Willets' state-
ment because they asserted that they reported the alleged inti-
mate relationship to agency employees in 1989 or 1990, but the
record shows that the report was made in December of 1988.
Initial Decision at 8-9.  The administrative judge also discred-
ited the Willets' statement because of the implausibility of the
statement that Mr. Brown told Mr. Willet that the appellant
purchased alcohol for him. Id. According to the administra-
tive judge, neither Mr. Willet nor the agency presented any

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36a

    Thus, in contrast to the appellant's self-serving
denials of an intimate relationship with Mr. Brown
while he was an in-patient at the medical center, Mr.
Brown's statements have been detailed regarding the
existence of such a relationship.  We can conceive of
no reason for Mr. Brown to fabricate the existence of
such a relationship and the appellant has provided
none.  If Mr. Brown desired to please his current wife,
who was very upset about his being sent to the
Kennic Valley facility for treatment: it is likely that
he would have attempted to minimize the length of his
relationship with the appellant.  Thus, we sustain the
charge of having an intimate relationship with an
in-patient of the medical center.
    Also contrary to the administrative judge's find-
ing, the agency did prove that the appellant engaged
in sexual relations with Mr. Brown while he was an
out-patient at the medical center.
    The agency also argues that the appellant admitted
having sexual relations with Mr. Brown while he was
an out-patient from November 15, 1988, to March 2,

___________________(footnotes)

evidence that the alcohol purchase was ever reported, even
though such a purchase "would have had a far more direct
bearing on Mr. Brown's sobriety than his asserted intimate
relationship with the appellant." Id. at 9.  The agency asserts
that the administrative judge erred in discrediting the Willets'
statement because of the discrepancies in dates, and we agree.
The fact that the Willets erred in recalling the date of a
situation that existed several years earlier is not grounds to
discredit their entire statement.  Additionally, the fact that the
Willets did not report Mr. Brown's statement that the
appellant purchased alcohol for him is not grounds to discredit 
their statement.  Nevertheless, because of their limited knowl-
edge, their statement is of little probative value.

    6  See Agency File, Tabs 4m at 4-5 (statement of Siri
Krawchuk).

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37a

1990. In a December 20, 1991 affidavit, Ronald Wil-
liams stated that Mr. Brown missed several out-pa-
tient appointments at the medical center between
November 15, 1988, and March 2, 1990. See Appeal
File, " Tab 6, Affidavit of Ronald Williams at 1 and
accompanying list.  Thus, we find that Mr. Brown was
an out-patient at the agency medical center after his
early November of 1988 discharge from its domicili-
ary unit.  Since the appellant admitted, as mentioned
above, that she had sexual relations with Mr. Brown
on and off between November of 1988 until April of
1990, see Agency File, Tab 4k at 2, we also sustain the
charge that the appellant had an intimate relationship
with Mr. Brown while he was an out-patient.
    The agency failed to prove the specification of the
falsification charge that the appellant persuaded Mr.
Brown to conceal the existence of their relationship.
    The administrative judge properly found that the
agency failed to prove that the appellant persuaded
Mr. Brown in December 1989 to conceal from the
appellant's supervisor the existence of their relation-
ship.  To support this specification, the agency relied
on Mr. Brown's statement to the agency investiga-
tors that the appellant told him that, if her supervisor
found out about the relationship, she would be in a lot
of trouble and would probably lose her job.  See
Agency File, Tab 4j at 2. Mr. Brown also stated that
he had refused to say that he was involved in a rela-
tionship with the appellant because he wanted to
protect her and because he thought the agency would
"take my sex away." Agency File, Tab 4j at 8.  Thus,
according to Mr. Brown's statement, while the
appellant told him of possible consequences if her
supervisor found out about the relationship, the
appellant never asked him to conceal their relation-

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38a

ship;  instead, his statement indicates that he decided
on his own to lie. Thus, the administrative judge
properly did not sustain this aspect of the falsification
charge.
    The agency improperly charged the appellant with
providing false statements concerning her relation-
ship with Brown.
    As discussed above, the agency charged the appel-
lant with providing false statements concerning her
relationship with Mr. Brown.  Specifically, on review,
the agency points to the inconsistent  statements that
the appellant has provided to it and asserts that these
statements demonstrate that the appellant falsified.
In Grubka v. Department of the Treasury, 858 F.2d
1570, 1574 (Fed. Cir. 1988), the court addressed the
situation where an agency charges an employee with
misconduct and separately charges him or her with
making a false statement in response to an agency
inquiry about the misconduct.  The court in Grubka
found circuitous and without merit the administrative
judge's reasoning in that appeal that, by proving the
underlying misconduct, the agency ipso facto proved
that Grubka's denial of the misconduct was false and
therefore proved the separate offense of making a
false statement. Id. The court in Grubka stated as
follows:

      It has always been the rule and practice that a
      person charged with an offense can deny the
      charge and plead not guilty, either because he is
      not guilty or to force the charging party to
      prove the charge, and regardless of the outcome,
      the denial is not itself a separate offense.
      Otherwise, a person could never defend himself
      against a charge, even though frivolous, for fear

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39a

       of committing another offense by denying the
       charge.  The decision of the [administrative
        judge] denied Grubka his due process rights in
       that it denied him the right to a trial on the
       charge without due process of law.

Id. at 1575. 7.

    We recognize that the Board has previously held
that an agency may separately charge an employee
with misconduct and making false statements regard-
ing the alleged misconduct, when the falsification
concerns a matter of official interest to the agency.
See Greer v. U.S. Postal Service, 43 M.S.P.R. 180,
184-85 (1990); see also, e.g., Kane v. Department of
Veterans Affairs, 46 M.S.P.R. 203, 209 (1990); Ster-
ling v. Department of Defense, 46 M.S.P.R. 177,
185-86 (1990); Hornbuckle v. Department of the
Army, 45 M.S.P.R. 50, 54 n. 2 (1990); Hill v. Depart-
ment of the Army, 44  M.S.P.R. 607, 611-12 (1990).
Upon further consideration, however, we find that
such decisions are based on a faulty analysis of the
Federal Circuit's decision in Grubka.
    The agency specifically charged Grubka with
making a false statement in a matter of official inter-
est. Grubka, 858 F.2d at 1574.  The Federal Circuit
stated, however, that such a charge "has no sub-
stance, is frivolous, and . . . it is not supported by
substantial evidence and is erroneous as a matter of
law. . . ." Id. By using the conjunctive "and" the
court made two separate findings: that the charge was

___________________(footnotes)

    7  The Federal  Circuit  reaffirmed its holding in Grubka  in
Beverly v. U.S. Postal Service, 907 F.2d 136, 137 (Fed. Cir.
1990), in finding that the administrative judge correctly held
that a charge of making a false statement in denial of another
charge should not have been stated as a separate offense.

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40a

erroneous as a matter of law, and that the charge was
nonsupported by substantial evidence. Id. Thus, the
court opined that a separate charge of making a false
statement regarding other alleged misconduct was
erroneous as a matter of law. Id.
    The court also found that the agency's charge must
fail because the appellant's alleged false statement
"was not a denial of a matter of official interest to the
IRS, because it had nothing to do with the work of the
agency." Id. at 1575.  This holding pertained to the
agency's failure to prove every element of its charge,
namely, that Grubka made a false statement and that
the false statement dealt with a matter of official
interest to the agency. Id. Contrary to our previous
holdings, we find that this statement was not intended
to carve out an exception to the court's holding that
the denial of another charge can never itself be a
separate offense; rather, it pertained to the evidence
presented. in support of that charge.
    In Greer and its progeny, the Board also mischar-
acterized the Federal Circuit's due process concerns
by stating that the court was concerned with the
appellant's Fifth Amendment right to remain silent.
On further consideration, we find that the court was
actually more concerned about an appellant's due
process right to have an opportunity to be heard on a
charge, and not to have a falsification type charge
automatically sustained by virtue of the sustaining of
an underlying charge.  See Grubka, 858 F.2d at 1575.
    In addition, the Board's decision in Greer was
erroneous for stating that, as an alternative to falsi-
fying during an agency investigation, an employee
may refuse to answer questions.  Greer, 43 M.S.P.R.
at 186.  That statement ignored the fact that, under
Board and Federal Circuit precedent, an employee

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41a

may be removed solely for remaining silent in re-
sponse to an inquiry if the employee is adequately
informed that he or she is subject to discharge for not
answering questions and that any replies and their
fruits cannot be employed in a criminal case.  See
Weston v. Department of Housing & Urban Develop-
ment, 724 F.2d 943, 949 (Fed. Cir. 1983); Haine v.
Department of the Navy, 41 M.S.P.R. 462,469 (1989).
    Thus, to the extent that Greer, and cases that rely
on its holding, hold that an agency may separately
charge an employee with misconduct and making false
statements or a similar offense regarding the alleged
misconduct, we overrule them.  We find that the
charge of making fake statements was improper and
that the administrative judge erred in considering it.
     A 90-day suspension is the maximum reasonable
penalty for the sustained  misconduct.
When the Board does not sustain all of the agency's
charges and specifications, we must carefully con-
sider whether the sustained misconduct merits the
penalty imposed by the agency.  Douglas v. Veterans
Administration, 5 M.S.P.R. 280, 308 (1981).  In this
case, we have found that, while employed as a social
services assistant, the appellant engaged in sexual
relations with an alcohol-dependent patient at the
agency medical center.  The sustained charge is
serious since, as stated by the chief of the domiciliary
unit, patients are very  vulnerable and dependent and
can be easily manipulated by the staff. Appeal File,
Tab 6 (statement of Ronald Williams) at 2. As further
stated by the chief of the domiciliary unit, personal
relationships can tempt dependency and hamper a
patient's efforts at sobriety. Id. Thus, we find that
the appellant's relationship with Mr. Brown went to
the core of her duties as a social services assistant in

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42a

the domiciliary unit. Moreover, the misconduct was
intentional and continued for some 18 months.
    Although the Board has previously held that an
appellant's false statements may be considered in
determining g the maximum reasonable penalty, we are
not considering the appellant's apparently false state-
ments here.  If we are to give meaning to the Federal
Circuit's statement that a person charged with an
offense may deny the charge and force the charging
party to prove the charge, we must hold that the
denial of misconduct cannot result in harm to the
accused.  Otherwise, we are still saying that the
accused may only deny a charge at his or her own
peril.  Accordingly, to the extent that previous Board
decisions have held that an appellant's false state-
ments in response to an agency inquiry may be
considered in determining the penalty, we overrule
them.
    Despite the seriousness of the appellant's miscon-
duct, she has over 17 years of service with the agency,
at least the last year of which was rated at the highly
successful level.  In addition, the record contains no
indication of any prior disciplinary actions against
her.  Thus, we find that a 90-day suspension is suffi-
cient to impress upon the appellant the seriousness of
her misconduct, and that it constitutes the maximum
reasonable penalty for the sustained misconduct.

ORDER

    Accordingly, we ORDER the agency to cancel the
appellant's removal and to replace it with a 90-day
suspension effective September 26, 1991. See Kerr v.
National Endowment  for the Arts, 726 F.2d 730 (Fed.
Cir. 1984).  The agency must accomplish this action
within 20 days of the date of this decision.

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43a

    We also ORDER the agency to issue a check to the
appellant for the appropriate amount of back pay,
interest on back pay, and other benefits under the
Office of Personnel Management's regulations, no
later than 60 calendar days after the date of this
decision.  We ORDER the appellant to cooperate in
good faith in the agency's efforts to compute the
amount of back pay, interest, and benefits due, and to
provide all necessary information the agency re-
quests to help it comply.  If there is a dispute about
the amount of back pay; interest due, and/or other
benefits, we ORDER the agency to issue a check to
the appellant for the undisputed amount no later than
60 calendar days after the date of this decision.
    We further ORDER the agency to inform the appel-
lant in writing of all actions taken to comply with the
Board's Order and of the date on which the agency
believes it has fully complied.  If not notified, the
appellant should ask the agency about its efforts to
comply.
    Within 30 days of the agency's notification of com-
pliance, the appellant may file a petition for enforce-
ment with the regional office to resolve any disputed
compliance issue or issues.  The petition should con-
tain specific reasons why the appellant believes that
there is insufficient compliance, and should include
the dates and results of any communications with the
agency about compliance.
    This is the final order of the Merit Systems
Protection Board in this appeal.  5 C.F.R. 
1201.113(c).

NOTICE TO APPELLANT

    You have the right to request the United States
Court of Appeals for the Federal Circuit to review the

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44a

Board's final decision in your appeal if the court has
jurisdiction. See 5 U.S.C.  7703(a)(1). You must sub-
mit your request to. the court at the following
address:
               United States Court of Appeals
                     for the Federal Circuit
                   717 Madison Place, N.W.
                    Washington, DC 20439.
    
    The court must receive your request for review no
later than 30 calendar days after receipt of this order
by your representative, if you have one, or receipt by
you personally, whichever receipt occurs first. See 5
U.S.C.  7703(b)(l).
    FOR THE BOARD:  /s/ ROBERT E. TAYLOR
                                           ROBERT E. TAYLOR
                                           Clerk of the Board

Washington, D.C.

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CONCURRING OPINION OF CHAIRMAN
BEN  L. ERDREICH
Jeanette M. Walsh v. Department of Veterans Affairs
     CH-0752-92-0021-I-1

    I concur in the majority opinion in this appeal
because it is consistent with the binding precedent of
the U.S. Court of Appeals for the Federal Circuit.
Nevertheless, I write separately to express my
concerns about how the Federal Circuit's holdings
that control the Board's decision in this case 8. com-
port with federal statutory and regulatory require-
ments.
    In Grubka and Beverly the Federal Circuit estab-
lished and affirmed the principle that a federal em-
ployee may not be disciplined for both an act of mis-
conduct and the false denial of that act of misconduct.
In other words, an employee may give an untrue
denial statement in response to an agency investiga-
tion into his alleged misconduct without the possibil-
ity of discipline for that statement (so long as the
underlying misconduct being investigated ultimately
is used to support a formal disciplinary charge
against the employee).  In application, this principle
seems to conflict with several mandates that require
a federal employee to be truthful in dealings with his
federal employer.
    For example, 18 U.S.C. 1001 requires individuals
to be truthful in any statements given in a matter
within the jurisdiction of a federal agency, or suffer
the penalty of a fine of up to 10,000 and imprisonment

___________________(footnotes)           

    8 Grubka v. Department of the Treasury, 858  F.2d 1570
(Fed. Cir. 1988) and Beverly v. United States Postal Service,
907 F.2d 136 (Fed. Cir. 1990).

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46a

of up to five years. Title 5 of the Code of Federal
Regulations, section 5.4 (Civil Service Rule V)
requires employees to give testimony under oath
when required to by the Office of Personnel Manage-
ment, the Merit Systems Protection Board, or the
Office of Special Counsel.  Agency inspectors general
investigating alleged fraud, federal security special-
ists investigating alleged security breaches, and EEO
investigators investigating alleged discrimination all
conduct inquiries on behalf of agencies and all rou-
tinely rely on the truthfulness of the statements
made by federal employees.
    Under 18 U.S.C.  1001 even individuals who are
being questioned about possible criminal wrongdoing
do not have the right to provide false information, yet
Grubka and Beverly hold that an employee being
questioned about possible non-criminal misconduct is
allowed to provide false information with impunity.
Although the former individual may exercise his
Fifth Amendment right to remain silent, the latter
does not enjoy that right and may not decline to
answer questions from his employer. 9.
    Thus Grubka and Beverly have the anomalous
result that an employee maybe required to respond to
an agency inquiry, but may not be required to respond
truthfully.  They also give federal employees a privi-
lege not accorded to ordinary citizens who "may de-
cline to answer the question, or answer it honestly,
  
___________________(footnotes)
              
    9  See  Weston  v. Department  of  Housing &  Urban Develop-
ment, 724 F.2d 943, 948-49 (Fed. Cir. 1983) (a federal employee
may be removed solely for remaining silent in response to an
agency inquiry if the employee is adequately informed that he
or she is subject to discharge for not answering questions and
that any replies and their fruits cannot be used in a criminal
case).

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47a

but [who] cannot with impunity knowingly and will-
fully answer with a falsehood." Bryson v. United
States, 396 U.S. 64,72 (1969).
    Title 18 U.S.C. 1001 criminalizes the making of a
false, fictitious, or fraudulent statement to a federal
department or agency by an employee regarding his
or her employment. Its application under Grubka and
Beverly apparently means that an employee could be
fined and imprisoned for making false, fictitious, or
fraudulent statements, but the employing agency
could not consider those statements in connection
with an adverse action based in part on any miscon-
duct at issue in the false, fictitious, or fraudulent
statements.
    I am aware that a majority of federal circuit courts
of appeals has adopted the principle that the subject of
a criminal investigation may falsely deny a charge of
misconduct without violating 18 U.S.C.  1001. 10.  How-
ever, I do not find that doctrine analogous to this
situation because (1) the administrative proceedings
in this case do not involve the Fifth Amendment right
to remain silent found in criminal proceedings, (2) the
statements made in Grubka and Beverly are more
than the simple denials of misconduct, and (3) the
false statements made by Ms. Walsh were made for
the purpose of retaining her federal position. This

___________________(footnotes)

    10 The "exculpatory no" doctrine is discussed in United
States v. Taylor, 907 F.2d 801, 803-06 (8th Cir. 1990); United
States v. Cogdell, 844 F.2d 179, 182-84 (4th Cir. 1988); United
States v. Medina De Perez, 799 F.2d 540,542-47 (9th Cir. 1986);
United States v. Tabor, 788 F.2d 714, 716-19 (11th Cir. 1986);
United States v. Fitzgibbon, 619 F.2d 874, 876-81 (10th Cir.
1980); United  States v. Chevoor, 526 F.2d 178, 181-84 (1st Cir.
1975), cert. denied, 425 U.S. 935 (1976).

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48a

last condition has been. specifically referenced as a
situation not protected by the doctrine. 11.
    In Grubka the Court held that Mr. Grubka could
not be disciplined for either the false denial of the
charged misconduct or for giving a written statement
supporting that denial.  In Beverly the Court held
that Ms. Beverly could not be disciplined for either
the false denial of the charged misconduct or for
providing false notarized statements from other
individuals supporting her untruthful denial.  This is
clear direction to the Board that we also should re-
verse disciplinary charges that are based on the
denial of misconduct or on statements made in. sup-
port of that denial.
    Regardless of federal statutory and regulatory
mandates requiring employee honesty in dealings in
matters within the jurisdiction of a federal agency,
under Grubka and Beverly the Board is compelled not
to sustain any charges related to enforcing this
standard of truthfulness if the employee is denying
misconduct that is the basis for a separate formal
disciplinary charge against that employee.
    In this case Ms. Walsh was charged with making
seven false statements. 12.  One of those statements
was found by the Board not to be false.  Of the remain-
ing six statements, five are specific denials of acts
that would constitute engaging in an intimate rela-
tionship with a patient, and the sixth is a falsehood

___________________(footnotes)

    11 Paternostro  v. United  States, 311 F.2d 298, 305 (5th Cir.
1962), overruled by United States v. Rodriguez-Rios, 14 F.3d
1040 (5th Cir. 1994) (en banc); Marzani v. United States, 168
F.2d 133, 141-42 (D.C. Cir.), aff'd on appeal by an equally
divided Supreme Court, 335 U.S. 895 (1948).
12. Agency File, tab 4h.

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49a

about a fact related to her relationship with that
patient.  Since a separate charge that is the basis for
this removal is engaging in an intimate relationship
with a patient, the entire charge of making false
statements in an agency investigation must be set
aside as inconsistent with the rule in Grubka and
Beverly.  This is true even though there are other
statutory or regulatory admonitions requiring truth-
fulness of federal employees.
    I have concerns about how this decision following
Grubka and Beverly affects the standards of em-
ployee conduct basic to the ethical underpinnings of
our federal civil service.  Accordingly, I concur with
the majority opinion but with the reservations
discussed above.

/s/ BEN L. ERDREICH
BEN L. ERDREICH
Chairman

[Decision Sheet Omitted]

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APPENDIX D

UNITED STATES OF AMERICA
MERIT SYSTEMS PROTECTION BOARD

No. DA-0752-93-0295-I-1

LESTER E. ERICKSON, APPELLANT

v.

DEPARTMENT OF THE TREASURY, AGENCY
MERIT SYSTEMS PROTECTION BOARD

[Filed June 1,1994]

    Before: ERDREICH, Chairman, PARKS, Vice Chair-
man, and AMADOR, Member.

OPINION AND ORDER

    The appellant petitions for review of the July 21,
1993 initial decision that upheld his removal. We find
that the petition does not meet the criteria for review
set forth at 5 C.F.R.  1201.115, and we therefore
DENY it. We REOPEN this case on our own motion
under 5 C.F.R.  1201.117, however, AFFIRM the
initial decision IN PART, REVERSE the initial
decision IN PART, and MITIGATE the removal to a
15-day suspension.

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51a

BACKGROUND

    The agency removed the appellant from his Police
Sergeant position for: (1) "Making False Statements
in Matters of Official Interest"; and (2) "Conduct
Unbecoming a Supervisor." Initial Appeal File (IAF),
Tab 8, Subtabs 4a, 4b, 41.  The appellant filed a timely
petition for appeal in which he alleged that, in re-
moving him, the agency discriminated against him on
the basis of a handicapping condition and violated his
constitutional rights. IAF, Tab 2.  The administra-
tive judge, deciding the appeal on the basis of the
parties' written submissions, sustained both charges,
rejected the appellant's claims of handicap discrimina-
tion and violation of his constitutional rights, and
affirmed the removal. IAF, Tab 26.
    The appellant reiterates his handicap discrimina-
tion claim and his constitutional claims in his timely
petition for review. Petition for Review (PRF), Tab
1. The agency opposes the petition for review. PRF,
Tab 3.

ANALYSIS

The petition for review establishes no error; the
initial decision is affirmed in part.

    The appellant does not identify in his petition for
review any legal error on the administrative judge's
part with respect to the charges or his handicap dis-
crimination claim, nor does he identify any relevant
evidence that the administrative judge overlooked or
misinterpreted. We therefore deny the petition for
review. 5 C.F.R.  1201.115(c). Having reopened this
appeal, and discerning no error in the initial deci-
sion's sustaining charge (2) and rejecting the appel-

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52a

lant's handicap discrimination claim, we affirm those
findings.

Charge (1) cannot be sustained.

    The agency specified in support of charge (1) that
the appellant "had knowledge of, and participated in,"
a series of anonymous harassing telephone calls re-
ceived by agency employees.  The caller was referred
to as the "Mad Laugher" because he or she would
laugh wildly into the telephone and then hang up.  The
agency further specified that the appellant gave a
sworn statement to an agency investigator in which
he denied knowing who had made the calls. It
therefore charged him with "Making False State-
ments in Matters of Official Interest" in violation of
the agency's Minimum Standards of Conduct. IAF,
Tab 8, Subtab 41; see IAF, Tab 8, Subtab 4cc  at 2.
    Charge (1) appears to be based on the appellant's
responses to question numbers 2, 6, 9, and 12 on the
list of questions that an agency investigator posed to
him on October 30, 1992.  Question number 2 states,
"Approximate the number of occasions you made `Mad
Laugher' calls and to whom by name?"  The appellant
responded, "None." Question number 6 states, "Ap-
proximate time you quit participating in "Mad
Laugher" calls" The appellant responded,  "I never
participated." Question number 9 states, "Specifi-
cally, how many times did you ask your subordinates
to cease the `Mad Laugher' calls?" The appellant re-
sponded, "None, [b]ecause I do not know who is doing
it." Question number 12 states in pertinent part,
"Are you willing to specifically state all those that
are participants in- the `Mad Laugher' telephone
calls."  The appellant responded, "No-I do not know
the true identification of the `Mad Laugher.' In my

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53a

opinion it is 95% of the police unit [and] also possibly
personnel in Production." See IAF, Tab 8, Subtab 4x
at 5,7,9.  Charge (2), "Conduct Unbecoming a Super-
visor," was based on the appellant's having encour-
aged an employee of an agency contractor to make a
"Mad Laugher" call to another agency police officer
during duty hours.  IAF, Tab 8, Subtab 41.
    An agency may not charge an employee with falsely
denying misconduct when it is separately charging
the employee with the underlying misconduct. Gru-
bka v. Department of the Treasury, 858 F.2d 1570,
1574-75 (Fed. Cir. 1988); Walsh v. Department of
Veterans Affairs, 62 M.S.P.R. 586,595 (1994). Thus,
charge (1) cannot be sustained, for its essence is the
appellant's failure to admit that he was involved in the
misconduct under investigation.
    We note that the agency, in its submission to
the administrative judge, alleged that several police
officers witnessed the appellant making "Mad
Laugher" calls to agency employees during duty
hours. IAF, Tab 25 at 6.  The agency did not charge
the appellant with making such calls, however.
Charge (1) is based entirely on the veracity of state-
ments that the appellant made to an agency official
who was investigating the calls.  Although charge (1)
does make reference to the appellant's "participation]
in" the "Mad Laugher" calls, it is captioned "Making
False Statements in Matters of Official Interest," it
cites a provision of the agency's Minimum Standards
of Conduct that relates solely to making false state-
ments, and the specification in support of the charge
relates only to the appellant's answers to the agency
investigator's questions. IAF, Tab 8, Subtabs 41, 4CC
at 2. Charge (2) is based entirely on the appellant's
having encouraged an employee of an agency contrac-

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54a

tor to make a call. IAF, Tab 8, Subtab 41. Neither
charge, therefore, was sufficient to put the appellant
on notice that he was being charged with making
"Mad Laugher" calls.
    The Board will not sustain an adverse action on the
basis of charges that could have been brought, but
were not. Nazelrod v. Department of Justice, 54
M.S.P.R. 461, 466 (1992).  Accordingly, we disregard
the agency's allegation that the appellant made "Mad
Laugher" calls.
    We therefore reverse the initial decision insofar as
it sustained charge (l).

The penalty of removal is mitigated to a 15-day
suspension.

    Where, as here, not all of the charges upon which an
agency based an adverse action are sustained, the
Board must carefully consider whether the sustained
charges merit the penalty imposed. See Montalvo v.
U.S. Postal Service, 55 M.S.P.R. 128,132-33 (1992).
    Again, charge (2) is based on the appellant's having
encouraged an employee of an agency contractor to
make a "Mad Laugher" call to another agency police
officer during duty hours.  IAF, Tab 8, Subtab 41.
This misconduct reflected poor judgment on the ap-
pellant's part.  On the other hand, it was not "dis-
ruptive," as averred by the deciding official, IAF, Tab
23 at 2, for as stated in the notice of proposed removal,
the contractor's employee did not make the call, IAF,
Tab 8, Subtab 41.
    Further, although the appellant, as a supervisor, is
held to a higher standard of conduct than a non-super-
visory employee, Jackson v. U.S. Postal Service, 48
M.S.P.R. 472,476 (1991), it does not appear from the
affidavit of the contractor's employee that the ap-

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55a

pellant encouraged her to make the telephone call
openly and in front of his subordinates, IAF, Tab 8,
Subtab 4y. Thus, his misconduct was not such that it
destroyed his ability to effectively supervise.
    Additionally, although the deciding official con-
sidered the appellant's having denied his involvement
in the "Mad Laugher" calls to have been "blatant
dishonesty," IAF, Tab 23 at 2, we do not consider it as
an aggravating  factor, see Walsh v. Department of
Veterans Affairs, 62 M.S.P.R. 586,595-596 (1994) (an
employee's false denial of misconduct is not an ag-
gravating factor in assessing the penalty for the
misconduct).
    The appellant performed satisfactory service in his
Police Sergeant position for approximately two years
and four months.  IAF, Tab 8, Subtabs 4a, 4bb.  There
is no evidence to indicate that he has a record of
discipline for misconduct, and in any event, the
agency did not cite elements of his record in the
notice of proposed removal. IAF, Tab 8, Subtab 41; see
Underwood v. Department of Defense, 53 M.S.P.R.
355, 360 (an employee's past disciplinary record can-
not be considered in determining the appropriate
penalty for misconduct if it was not cited in the notice
of adverse action), aff`d, 980 F.2d 744 (Fed. Cir. 1992)
(Table).  For the single instance of encouraging an
employee of an agency contractor to make a "Mad
Laugher" call that the employee did not make, we
conclude that the maximum reasonable penalty, under
the circumstances, is a 15-day suspension.

ORDER

    We ORDER the agency to cancel the appellant's
removal and to replace it with a 15-day suspension,
retroactive to March 20, 1993. See Kerr v. National

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56a

Endowment for the Arts, 726 F.2d 730 (Fed. Cir.
1984).  The agency must accomplish this action within
20 days of the date of this decision.
    We also ORDER the agency to issue a check to the
appellant for the appropriate amount of back pay,
interest on back pay, and other benefits under the
Office of Personnel Management's regulations, no
later than 60 calendar days after the date of this
decision.  We ORDER the appellant to cooperate in
good faith in the agency's efforts to compute the
amount of back pay, interest, and benefits due, and to
provide all necessary information the agency re-
quests to help it comply.  If there is a dispute about
the amount of back pay, interest due, and/or other
benefits, we ORDER the agency to issue a check to
the appellant for the undisputed amount no later than
60 calendar days after the date of this decision.
    We further ORDER the agency to inform the
appellant in writing of all actions taken to comply
with the Board's Order and of the date on which the
agency believes it has fully complied.  If not notified,
the appellant should ask the agency about its efforts
to comply.
    Within 30 days of the agency's notification of com-
pliance, the appellant may file a petition for enforce-
ment with the regional office to resolve any disputed
compliance issue or issues.  The petition should
contain specific reasons why the appellant believes
that there is insufficient compliance, and should
include the dates and results of any communications
with the agency about compliance.
    This is the final order of the Merit Systems Pro-
tection Board in this appeal. 5 C.F.R. 1201. 113(c).

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57a

NOTICE TO APPELLANT

    You have the right to request further review of the
Board's final decision in your appeal.

Discrimination Claims: Administrative Review

    You may request the Equal Employment Opportu-
nity Commission (EEOC) to review the Board's final
decision on your discrimination claims. See 5 U.S.C.
 7702(b)(1). You must submit your request to the
EEOC at the following address:

Equal Employment Opportunity Commission
        Office of Federal Operations
             P.O. BOX 19848
          Washington, DC 20036

    You should submit your request to the EEOC no
later than 30 calendar days after receipt of this order
by your representative, if you have one, or receipt by
you personally, whichever receipt occurs first. See 5
U.S.C.  7702(b)(1).

Discrimination and Other Claims: Judicial Action

    If you do not. request review of this order on your
discrimination claims by the EEOC, you may file
a civil action against the agency on both your
discrimination claims and your other claims in an
appropriate United States district court.  See 5
U.S.C.  7703(b)(2). You should file your civil action
with the district court no later than 30 calendar days
after receipt of this order by your representative, if
you have one, or receipt by you personally, whichever
receipt occurs first.  See 5 U.S.C.  7703(b)(2).  If the
action involves a claim of discrimination based on
race, color, religion, sex, national origin, or a handi-
capping condition, you may be entitled to representa-

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58a

tion by a court-appointed lawyer and to waiver of any
requirement of prepayment of fees, costs, or other
security.  See 42 U.S.C.  2000e-5(f); 29 U.S.C.  794a.

Other Claims: Judicial Review

    If you choose not to seek review of the Board's
decision on your discrimination claims, you may re-
quest the United States Court of Appeals for the
Federal Circuit to review the Board's final decision
on other issues in your appeal if the court has juris-
diction. See 5 U.S.C.  7703(b)(1).  You must submit
your request to the court at the following address:

        United States Court of Appeals
            for the Federal Circuit
          717 Madison Place, N.W.
          Washington, DC 20439

    The court must receive your request for review no
later than 30 calendar days after receipt of this order
by your representative, if you have one, or receipt by
you personally, whichever receipt occurs first. See 5
U.S.C. 7703(b)(1).

FOR THE BOARD:     /s/ ROBERT E. TAYLOR 
                                          ROBERT E. TAYLOR
                                          Clerk of the Board

Washington, D.C.

[Decision Sheet Omitted]

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59a

APPENDIX E

UNITED STATES OF AMERICA
MERIT SYSTEMS PROTECTION BOARD

No. PH-0752-93-0524-I-1
SHARON KYE, APPELLANT

v.

DEFENSE LOGISTICS AGENCY, AGENCY
MERIT SYSTEMS PROTECTION BOARD

[Filed: Oct. 4, 1994]

Before: ERDREICH, Chairman, PARKS, Vice Chair-
man, and AMADOR, Member.

OPINION AND ORDER

    The appellant petitions for review of the November
12, 1993 initial decision that sustained her removal.
For the reasons discussed below, we GRANT the
petition, REVERSE the initial decision in part,
AFFIRM the initial decision in part, and MITIGATE
the penalty to a 45-day suspension.

BACKGROUND

    The agency removed the appellant from the GS-12
position of Supervisory General Supply Specialist
based on the following six charges: failure to safe-
guard her government Diners Club Card and personal
identification number (PIN) (first offense); failure to

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60a

follow specific instructions for reporting loss, theft,
or compromise of her government Diners Club Card
and/or PIN; failure to fully participate in an official
investigation (first offense); misuse of her govern-
ment Diners Club card (first offense); providing false
information in an official investigation (first offense);
and failure to properly notify the agency of an
unscheduled absence (first offense).
    The administrative judge found that the agency did
not prove two of the charges, i.e., failure to fully
participate in an official investigation and failure to
properly notify the agency of an unscheduled absence.
Also, he found that the appellant did not prove her
affirmative defenses of handicap discrimination based
on alcoholism and reprisal for filing an equal employ-
ment opportunity complaint.  The administrative
judge sustained the agency's removal action based on
the appellant's sustained misconduct which included
her response to the agency's inquiry into that matter.
Initial Appeal File (IAF), Tab 18 (Initial Decision at
21).
     In her petition for review, the `appellant alleges that
the administrative  judge erred in finding that she had
not demonstrated that she was an alcoholic, in failing
to address her allegation that the agency discrimi-
nated against her on the basis of  the handicapping
condition of mood disorder and depression, and in not
considering the cumulative effect of these claimed
medical conditions in his adjudication of her handicap
discrimination claim.

ANALYSIS

    The administrative judge erred by limiting his
analysis of the appellant`s handicap discrimination
claim to the condition of alcoholism, but this error

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61a

was not prejudicial; the Board finds no merit to the
claim.
    The appellant raised a claim of handicap discrimina-
tion on the additional basis of depression below by
submission of a letter from her physician diagnosing
her depression, and by counsel at the hearing. IAF,
Tab 17; Hearing Transcript at 6.  Although the admin-
istrative judge alluded to the evidence concerning the
appellant's condition of depression, ID at 16-18, he did
not analyze that matter in connection with the appel-
lant's handicap discrimination claim.  This adjudica-
tory error did not prejudice the appellant's substan-
tive rights, however, because the appellant has failed
to demonstrate that her claimed medical conditions,
either alone or in tandem, caused her sustained mis-
conduct.  See Panter  v. Department of  the Air Force,
22 M.S.P.R. 281,282 (1984).
    Specifically, we find that the appellant has failed to
make out a prima facie case of handicap discrimina-
tion.  The necessary elements of a prima facie case of
handicap discrimination will vary according to the
particular facts and circumstances at issue.  See
Dazey v. Department of the Air Force, 54 M.S.P.R.
658, 661 (1992).  Generally, the elements of a prima
facie case of handicap discrimination based on a
mental illness such as depression include: a showing
that the person is a qualified handicapped person and
that the action appealed was based on his handicap;
and, to the extent possible, an articulation of a rea-
sonable accommodation under which the employee
believes he could perform the essential duties of his
position. Id.  To make out a prima facie case of handi-
cap discrimination based on the condition of alcohol-
ism, an appellant must prove that he is a qualified
handicapped person and that his handicap caused his

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62a

misconduct or that the misconduct was entirely a
manifestation of his handicap. See Davis v. Depart-
ment of the Army, 57 M.S.P.R. 203,208-09 (1993).
    Here, we note that the physician who diagnosed the
appellant's mood disorder and depression, Patrick
Thrasher, M.D., first saw her July 23, 1993, almost
three months after the occurrence of the charged
misconduct. IAF, Tab 18 (ID at 16).  Therefore, this
evidence provides scant support for a finding that the
appellant's misconduct was caused by that condition.
    Further, the administrative judge's finding that the
appellant had not shown a causal relationship between
her claimed alcoholism and the sustained misconduct,
IAF, Tab 18 (ID at 19), similarly leads to a finding of a
lack of causation between the sustained misconduct
and the appellant's depression or a combination of
those two claimed medical conditions.  That is, the
administrative judge, assuming arguendo that the
appellant had established that she suffered from the
handicapping condition of alcoholism, nevertheless
correctly found that:

      The agency did not specifically claim that the
      appellant used her card to withdraw cash; but
      rather, that she failed to safeguard her card and
      PIN, failed to report its loss . . ., and, on one
      occasion, used the card for the rental of a motel
      room.  The appellant has not claimed that she does
      not recall not missing the card, [or] not knowing of
      her responsibilities with the card. . . .

Id.  Therefore, inasmuch as the appellant did not
establish causation, we find that she failed to make
out a prima facie case of handicap discrimination with
regard to the medical conditions of alcoholism or

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63a

depression, or a combination of the two.  See Dazey,
54 M.S.P.R. at 661.
The agency improperly charged the appellant with
providing false information in an official investiga-
tion.
     In Walsh v. Department of Veterans Affairs, 62
M.S.P.R. 586 (1994), the Board, interpreting Grubka
v. Department of the Treasury, 858 F.2d 1570 (Fed.
Cir. 1988), recently held that an agency may not, as a
matter of law, separately charge an employee with
making a false statement in defending a charge of
alleged misconduct.  Here, the agency charged the
appellant with misconduct in connection with her
government Diners Club Card.  Under Walsh, the
agency's additional charge of providing false informa-
tion in an official investigation regarding the alleged
misconduct cannot be sustained.

A 45-day suspension is the maximum reasonable
penalty for the sustained misconduct.

    When not all of the charges are sustained, the
Board will consider carefully whether the sustained
charges warrant the penalty imposed by the agency.
Douglas v. Veterans Administration, 5 MSPB 313,5
M.S.P.R. 280, 308 (1981).  In this case, three of the six
charges against the appellant, including the charges
that the agency considered the most serious, IAF,
Tab 3, Subtab 1, have not been sustained.  The sus-
tained charges, i.e., (1) failing to safeguard a govern-
ment Diners Club Card and PIN; (2) failure to follow
specific instructions for reporting loss, theft, or
compromise of a government Diners Club Card and/or
PIN; and (3) one instance of misuse of a government
Diners Club Card, are serious.  They must, however,

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64a

be balanced against the appellant's unblemished
record, which the agency considered excellent, IAF,
Tab 18 (ID at 21), and the fact that, of her own
volition, the appellant  has taken full responsibility for
repaying the improper charges to her government
credit card.  The Board finds therefore that a 45-day
suspension is the maximum reasonable penalty for
the sustained charges.  See Nelson v. Veterans
Administration, 22 M.S.P.R. 65 (1984); Johnson v.
Department of the Treasury, 15 M.S.P.R. 731 (1983),
aff'd, 770 F.2d 181 (Fed. Cir. 1985) (Table).

ORDER

    We ORDER the agency to cancel the appellant's
removal and to substitute a 45-day suspension. See
Kerr v. National Endowment for the Arts, 726 F.2d
730 (Fed. Cir. 1984).  The agency must accomplish this
action within 20 days of the date of this decision.
    We also ORDER the agency to issue a check to the
appellant for the appropriate amount of back pay,
interest on back pay, and other benefits under the
Office of Personnel Management's regulations, no
later than 60 calendar days after the date of this
decision.  We ORDER the appellant to cooperate in
good faith in the agency's efforts to compute the
amount of back pay, interest, and benefits due, and to
provide all necessary information the agency re-
quests to help it comply.  If there is a dispute about
the amount of back pay, interest due, and/or other
benefits, we ORDER the agency to issue a check to
the appellant for the undisputed amount no later than
60 calendar days after the date of this decision.
    We further ORDER the agency to inform the
appellant in writing of all actions taken to comply
with the Board's Order and of the date on which the

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65a

agency believes it has fully complied. If not notified,
the appellant should ask the agency about its efforts
to comply.
    Within 30 days of the agency's notification of com-
pliance, the appellant may file a petition for enforce-
ment with the regional office to resolve any disputed
compliance issue or issues.  The petition' should con-
tain specific reasons why the appellant believes that
there is insufficient compliance, and should include
the dates and results of any communications with the
agency about compliance.
This is the final order of the Merit Systems Pro-
tection Board in this appeal. 5 C.F.R.  1201.113(c).

NOTICE TO APPELLANT

    You have the right to request further review of the
Board's final decision in your appeal.
Discrimination Claims: Administrative Review

You may request the Equal Employment Opportu-
nity Commission (EEOC) to review the Board's final
decision on your discrimination claims. See 5 U.S.C.
 7702(b)(l), You must submit your request to the
EEOC at the following address:

Equal Employment Opportunity Commission
  Office of Federal Operations
     P.O. BOX 19848
   Washington, DC 20036

You should submit your request to the EEOC no later
than 30 calendar days after receipt of this order by
your representative, if you have one, or receipt by you
personally, whichever receipt occurs first. See 5
U.S.C.  7702(b)(l).

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66a

Discrimination and Other Claims: Judicial Action

    If you do not request review of this order on your
discrimination claims by the EEOC, you may file a
civil action against the agency on both your dis-
crimination claims and your other claims in an appro-
priate United States district court. See 5 U.S.C. 
7703(b)(2). You should file your civil action with the
district court no later than 30 calendar days after re-
ceipt of this order by your representative, if you have
one, or receipt by you personally, whichever receipt
occurs first. See 5 U.S.C.  7703(b)(2). If the action
involves a claim of discrimination based on race, color,
religion, sex, national origin, or a handicapping con-
dition, you may be entitled to representation by a
court-appointed lawyer and to waiver of any require-
ment of prepayment of fees, costs, or other security.
See 42 U.S.C.  2000e5(f); 29 U.S.C.  794a.

Other Claims: Judicial Review

    If you choose not to seek review of the Board's
decision on your discrimination claims, you may
request the United States Court of Appeals for the
Federal Circuit to review the Board's final decision
on other issues in your appeal if the court has
jurisdiction. See 5 U.S.C.  7703(b)(l). YOU must
submit your request to the court at the following
address:
    United States Court of Appeals
     for the Federal Circuit
     717 Madison Place, N.W.
     Washington, DC 20439
The court must receive your request for review no
later than 30 calendar days after receipt of this order
by your representative, if you have one, or receipt by

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67a

you personally, whichever receipt occurs first. See 5
U.S.C.  7703(b)(l).
AMADOR, Member, issues a dissenting opinion.

For the Board

ROBERT E. TAYLOR,

WASHINGTON, DC.

DISSENTING OPINION OF MEMBER  AMADOR.
I dissent.
    In determining whether an agency selected penalty
is to be upheld, the Board has long followed the
principles set forth in Douglas v. Veterans Admini-
stration, 5 MSPB 313, 5 M.S.P.R. 280 (1981). The
majority opinion exhibits a flawed understanding of
this decision and distorts the factual record to
support its conclusion that mitigation is warranted.
    The first and most important of the twelve Douglas
factors is:

      The nature and seriousness of the offense, and its
      relation to the employee's duties, position, and
      responsibilities, including whether the offense
      was intentional or technical or inadvertent, or was
      committed maliciously or for gain, or was
      frequently repeated. Id., 5 M.S.P.R. at 305

    There is no question that, under this factor, the
appellant's offenses were extremely serious.  The
appellant repeatedly and intentionally misused her
government credit card for her (or her son's) personal
gain. A total of over 2000 in cash withdrawals were
made on 29 different occasions using the appellant's
government credit card.
    The second Douglas factor is the employee's job
level and type of employment, including whether the

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68a

employee was a supervisor. The appellant occupied a
supervisory position. at a fairly high position within
the agency (Branch Director, GS-12). The Board has
traditionally held supervisory employees to higher
standards of conduct. See, e.g., Walcott  v. U.S. Postal
Service, 52 M.S.P.R. 277, aff'd, 980 F.2d 744 (Fed. Cir.
1992) (Table).
    In addition, the appellant knew her actions were
wrong, and she was clearly on notice of the rules that
were violated by her misconduct. See Perrodin v.
Department of Justice, 56 M.S.P.R. 407, 413 (1992).
Moreover, when the problem with her credit card was
first brought to her attention by the agency, she
assured the agency that the problem had been
corrected, but additional credit charges were made
after this time. Thus, the administrative judge cor-
rectly found the appellant had forfeited the agency's
trust.
    Finally, the appellant is not a good candidate for
rehabilitation because she has not shown remorse for
her misconduct. See Dolezal v. Department of the
Army, 58 M.S.P.R. 64, 71 (1993), aff'd, 22 F.3d 1104
(Fed. Cir. 1994). To the contrary, in order to explain
away her misconduct and to avoid its consequences,
the appellant presented the obviously manufactured,
and uncorroborated, claim that she was suffering
from depression, drinking heavily, and taking drugs
during this one 30 day period in her life. The ad-
ministrative judge clearly and persuasively analyzed
this claim. He observed that the appellant's testi-
mony concerning the alleged effects of her drinking
was at great variance with that of her supervisors,
who testified that they had had daily contact with the
appellant and that they had never noticed any of the
classic signs of a substance abuse problem, i.e., no

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attendance problems, no appearance of impairment, no
odor of alcohol on her breath, no poor performance, no
incoherency in thought or expression, and no mood
swings or changes from her normal behavior. Based
on this evidence, the administrative judge correctly
found that there was no showing that the appellant's
alleged personal problems had led to or caused her
misconduct.
    The majority's opinion does not provide any sub-
stantial reasoning or logic for its decision to mitigate
the penalty. The majority's refusal to properly apply
Douglas represents a blatant violation of the principle
that the Board will not substitute its judgment for
that of the agency.
    The penalty of removal should be affirmed.

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APPENDIX F

UNITED STATES OF AMERICA
MERIT SYSTEMS PROTECTION BOARD

NOS. DE0752900226-B-2, DE0752900227-B-2
   and DE0752900228-B-2

MERIT SYSTEMS PROTECTION BOARD

MICHAEL G. BARRETT, JEROME K. ROBERTS,
AND THOMAS J. WIGGINS, APPELLANTS

v.

DEPARTMENT OF THE INTERIOR, AGENCY

[Filed Nov. 9, 1994]

    Before:  ERDREICH, Chairman, PARKS, Vice Chair-
man, and AMADOR, Member.

OPINION  AND ORDER

    The appellants have timely petitioned for review of
the September 3, 1993 remand `initial decision that
sustained the agency's actions against them. For the
reasons set forth below, we GRANT the petition for
review under 5 C. F. It.  1201.115, and AFFIRM the
initial decision as MODIFIED, still SUSTAINING
the adverse action with regard to Wiggins, but MITI-
GATING the penalty with regard to Barrett and
Roberts to a letter of reprimand.

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BACKGROUND

    The agency's actions against the appellants were
based on allegations that: (1) On the afternoon of June
9, 1988, Barrett, Roberts, and another agency em-
ployee left duty in a government pickup truck to help
build a fish pond in Wiggins' backyard and took
agency equipment with them; (2) neither Barrett nor
Roberts took leave for the time they were not on duty
and both men subsequently denied knowledge of the
event; (3) Wiggins did not charge his subordinates,
Barrett and Roberts, and two other agency employ-
ees, Ray Ben and Dean Slim, with leave for the time
they worked on the fish pond; 1. and (4) Wiggins
falsified his own time and attendance report for the
following Monday, June 13, 1988, by incorrectly
indicating that he was at work. MSPB Docket No.
DE07529010226, Initial Appeal File (IAF 1), Tab 3,
Subtab 4h; MSPB Docket No. DE07529010227, Initial
Appeal File (IAF 2), Tab 3, Subtab 4h; MSPB Docket
No. DE07529010228, Initial Appeal File (IAF 3), Tab 3,
Subtab 4j. As a result of this misconduct, the agency
suspended Barrett and Roberts for 30 days and re-
duced both of them in grade based on the charges of:
(1) Misrepresentation or concealment of a material
fact in connection with an investigation; (2) failure to
report an act of fraud, waste, and abuse; and (3)
making a false claim on a time and attendance report.
IAF 1, Tab 3, Subtabs 4a-4c, 4h; IAF 2, Tab 3, Subtabs
4a-4c, 4h. The agency reduced Barrett in grade from
a GS-11 soil scientist to a GS-9 soil scientist, IAF 1,

___________________(footnotes)

    1  At the time that the agency took the adverse actions
against the appellants, neither Ben nor Slim were still em-
ployed by the agency. Thus, they were not charged with mis-
conduct.

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Tab 3, Subtab 4b, and reduced Roberts in grade from a
GS-9 soil scientist to a GS-7 physical science techni-
cian, IAF 2, Tab 3, Subtab 4b. The agency removed
Wiggins from his GS-12 supervisory physical scien-
tist position based on the charges of: (1) Misuse of
a government vehicle; (2) misuse of government
equipment; (3) misuse of government employees; (4)
falsification of government time and attendance
reports; and (5) making a false claim on a time and at-
tendance report. IAF  3, Tab 3, Subtabs 4a, 4b, 4j.
    The appellants denied any misconduct and main-
tained that, although Wiggins was at his home during
the afternoon of June 9, 1988, he was on annual leave,
and that Roberts and Barrett were at work during the
period in question.  The appellants claimed that
Wiggins was assisted by three friends and two day
laborers, none of whom were agency employees.
    To support the charges, the agency primarily relied
on four witnesses: Ray Ben, Dean Slim, Stanley
Etsitty, and Ronald Martin. Ben and Slim were
agency employees at the time of the alleged mis-
conduct and testified that they went to Wiggins'
home, along with Barrett and Roberts, and helped
build the fish pond. Hearing Transcript (HT) at 37-40,
testimony of Ben; HT at 51-52, testimony of Slim.
Etsitty, also a former agency employee, testified that
he saw Roberts, Barrett, and Ben leave the agency
facility in the government pickup truck. HT at 7-8.
Martin, the driver of the cement truck that brought
the cement for the fish pond, testified that he saw
Roberts and Ben at Wiggins' home. He also testified
that he saw a pickup truck with a United States
Government license plate parked in front of Wiggins'
home. HT at 69-71.

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73a

    The appellants petitioned the Board for appeal of
the agency's actions . 2.  After affording the appellants
the hearing that they requested, the administrative
judge upheld all of the charges, except for the charge
that Wiggins falsified his own time and attendance
report for June 13, 1988, and sustained the actions.
IAF 1, Tab 20; IAF 2, Tab 20; IAF 3, Tab 20. The
appellants then petitioned for review of that initial
decision.
    In an Opinion and Order, the Board granted the
appellants' petition for review, vacated the initial de-
cision, remanded the appeal for additional fact find-
ings, and directed the administrative judge to issue a
new initial decision. Barrett v. Department of the
Interior, 54 M.S.P.R. 356 (1992). In a remand initial
decision, the administrative judge again upheld all of
the charges, except for the false time and attendance
report charge against Wiggins, and sustained the
actions. MSPB Docket No. DE0752900226B1, Re-
mand Initial Appeal File, Tab 12.
    The appellants petitioned for review of that initial
decision and the Board issued an Opinion and Order
that granted the petition for review, vacated the
initial decision, remanded the appeal for additional
fact findings, and directed the administrative judge to
issue a new initial decision. Barrett v. Department of
the Interior, 57 M.S.P.R. 635 (1993). The administra-
tive judge issued the instant initial decision in which
he complied with the Board's remand instructions and

___________________(footnotes)

    2  Because the issues raised in the appeals of all three appel-
lants are very similar and are interrelated, the appeals were
consolidated by the administrative judge during the original
adjudication of the appeals. IAF 1, Tab 4; IAF 2, Tab 4; IAF 3,
Tab 4; see 5 C.F.R.  1201.36(a)(1). The agency requested that
the appeals be consolidated, and none of the appellants objected.

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74a

again upheld all of the charges, except for the false
time and attendance report charge against Wiggins,
and sustained the actions.  MSPB Docket No.
DE0752900226-B-2, Remand Initial Appeal File, Tab 2,
Remand Initial Decision (RID). The appellants have
petitioned for review-of the remand initial decision.
    On review, the appellants argue that the admin-
istrative judge erred in his fact findings and credibil-
ity determinations in the remand initial decision.
MSPB Docket No. DE0752900226-B-2, Petition for
Review File (PFRF), Tab 1, Petition for Review
(PFR). The agency has timely responded in opposi-
tion to the petition for review.  PFRF, Tab 3.

ANALYSIS

The Board will not consider the appellants' reply to
the agency's response to the petition for review.

    The agency's response to the petition for review is
styled as a "Cross Petition for Review," but it raises
no allegations of error by the administrative judge in
the remand initial decision and thus only constitutes
a response to the petition for review. Id. In a notice
acknowledging the agency's submission, the Clerk of
the Board afforded the appellants 25 days to respond.
PFRF, Tab 4. Because the agency's submission
raises no allegations of error by the administrative
judge, it should not have been treated as a cross
petition for review and the appellants should not have
been afforded the opportunity to respond to it. Thus,
the record on review closed 25 days after the date
of service of the petition for review.  5 C.F.R.
 1201.l14(d), (i); PFRF, Tab 2. A party may not file
additional evidence or argument after the close of the
record on review unless the party shows that the

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evidence was not readily available before the record
closed.  5 C.F.R. 1201.114(i).
    We have not considered the appellants' reply to the
agency's submission titled a "cross petition for re-
view" which, as explained above, only constituted a
response to the petition for review. See PFRF, Tab 5.
Although an appellant has a right to reply to an
agency's cross petition for review, there is no right to
reply to an agency's response to a petition for review.
See 5 C.F.R.  1201.114(d), (i). Even though the appel-
lants were inadvertently informed that they could file
a reply to the agency's misnamed filing, the appel-
lants are not disadvantaged by now having that reply
disallowed because they had no right to file such a
document.

The administrative judge made a number of errors
in his fact findings and credibility determinations,
but those errors do not constitute reversible error.

    The Board will generally defer to an administrative
judge's fact findings and credibility determinations
and will not grant a petition for review based on a
party's mere disagreement with those fact findings
and credibility determinations. Weaver v. Depart-
ment  of the Navy, 2 MSPB 297,2 M.S.P.R. 129, 133-34
(1980), review denied, 669 F.2d 613 (9th Cir. 1982)
(per curiam). The Board is free, however, to sub-
stitute its own determinations of fact for those of an
administrative judge, giving his findings only as
much weight as may be warranted by the record and
by the strength of his reasoning. Id. at 133. In
making credibility determinations, the Board will
consider a number of factors, including  (1) The
witness's opportunity and capacity to observe the
event or act in question; (2) the witness's character;

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76a

(3) any prior inconsistent statement by the witness;
(4) the witness's bias, or lack of bias; (5) the con-
tradiction of the witness's version of events by other
evidence or its consistency with other evidence; and
(6) the inherent improbability of the witness's version
of events. Hillen v. Department of the Army, 35
M.S.P.R. 453,458 (1987).
    It is undisputed that Wiggins constructed a fish
pond at his residence in June 1988 and that Eagle
Readimix Concrete provided the concrete for the
project during the afternoon of June 9, 1988. It is also
undisputed that Wiggins was at his residence on
annual leave at the time of the concrete pour. The
dispositive issue in this appeal is whether appellants
Barrett and Roberts and agency employees Ben and
Slim were also present at Wiggins' residence at the
time of the concrete pour and whether they used
government equipment and a government pickup
truck in the project.

The administrative judge mischaracterized the testi-
mony of Kathleen Meech.

    In his remand initial decision, the administrative
judge found that the agency's chain of evidence began
with the testimony of Kathleen Meech, co-owner of
Eagle Readimix Concrete, that Roberts placed the
order for the concrete. RID at 12; HT at 64. The
administrative judge stated that, although Meech's
testimony did not place Roberts at the concrete pour
on June 9, 1988, it did directly contradict his written
statement that he had no knowledge of the fish pond
project. RID at 12; see IAF 2, Tab 3, Subtab 4p. On
review, the appellants argue that the administrative
judge mischaracterized Meech's testimony. PFR at
12. We agree. When asked on cross examination

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77a

whether she was sure if Roberts was the man who
placed the concrete order, Meech responded that
"[w]e'll, I'm going to have to say that I'm just-I'm
guessing." HT at 66.
    Thus, contrary to the administrative judge's find-
ing, Meech did not identify Roberts as the individual
who placed the concrete order, but rather "guessed"
that he was the individual. In addition, at the hearing,
the administrative judge interrupted the cross exami-
nation of Meech about her identification of Roberts
and stated that who placed the order for concrete was
not material.  HT at 66-67. The administrative
judge's error regarding Meech's testimony is not a
basis to reverse the remand initial decision because
he did not depend on Meech's identification of Roberts
as the sole basis to support additional findings else-
where in the remand initial decision. See RID at 14.

The administrative judge correctly characterized
Martin's testimony and the testimony of another
cement truck driver, and correctly found Martin
credible.

   The appellants also argue that the administrative
judge mischaracterized the testimony of Martin and a
second cement truck driver, Hector Estrada. PFR at
13-14. According to the appellants, the administrative
judge failed to mention that Martin's testimony did
not place Barrett and Slim at the concrete pour and
that Estrada could only identify Wiggins as being at
the concrete pour. Id.; see HT at 69-70, testimony of
Martin, HT at 79-80, testimony of Estrada. The appel-
lants also assert that the administrative judge erro-
neously stated that they offered no candidate for
possible misidentification by Martin when in fact they
suggested that Martin confused K.C. Liggins, a

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78a

friend of Wiggins who allegedly assisted in the pro-
ject, for Roberts. PFR at 13-14.
    We believe that the administrative judge correctly
characterized Martin's testimony and that the admin-
istrative judge's failure to mention every aspect,
limitation, or inconsistency in Martin's and Estrada's
testimony does not mean that he did not fully consider
the testimony. Marques v. Department of Health &
Human Services, 22 M.S.P.R.  129, 132 (1984), aff`d,
776 F.2d 1062 (Fed. Cir. 1985) (Table), cert. denied, 476
U.S. 1141, 106 S.Ct. 2247,90 L.Ed.2d 693 (1986). The
administrative judge did, however, misstate that the
appellants offered no candidates for possible misiden-
tification by Martin. RID at 12. As correctly argued
by the appellants on review, they contended below
that Martin confused Liggins for Roberts.  The re-
cord reflects, however, that Martin testified that
Roberts was present at Wiggins' home on June 9,
1988, and that he remembered the concrete delivery
because of an incident with Wiggins' check and his
driver's license. HT at 72-73.  In addition, we find
Martin's testimony about the white license plate on a
pickup truck parked in front of Wiggins' home
particularly compelling. HT at 71.  The administra-
tive judge correctly noted that New Mexico license
plates are yellow with red letters and that U.S.
Government license plates are white. RID at 4,
    As also found by the administrative judge, there is
no reason for Martin to fabricate his testimony and
his testimony was straightforward and convincing.
See RID at 8; see also Hillen, 35 M.S.P.R. at 458.
Thus, we find his testimony credible.

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79a

The administrative judge considered the testimony
of Etsitty, Slim, and Ben and correctly concluded
that their testimony was credible.

    The appellants also argue on review that the
administrative judge failed to consider bias against
the appellants by Etsitty, Slim, and Ben. PFR at
15-17.  The administrative judge considered the alle-
gations of bias and concluded that the appellants failed
to show that Etsitty, Slim, and Ben had a motive to
give false testimony. RID at 13.  As found by the
administrative judge, as former employees of the
agency, the three witnesses were potentially ad-
versely affecting their future employment oppor-
tunities with the agency by their admissions of
participation in the fish pond project during duty
hours. Id.  We agree with this assessment, at least
with regard to Ben and Slim, who testified that they
participated in the fish pond project.  HT at 37-39,
testimony of Ben; HT at 50-51, testimony of Slim.
Ben's and  Slim's testimony  is compelling because it
was contrary to their interests to admit involvement
in misconduct and thus they would have little
motivation to fabricate. See Hillen, 35 M.S.P.R. at
458.  With regard to Etsitty, we acknowledge that he
grieved a performance rating from Wiggins and that
he apparently had at least one work-related dis-
agreement with Barrett, but as found by the admin-
istrative judge, the appellants failed to show that he
was biased against them. RID at 13.
    The appellants also assert that the administrative
judge failed to consider Ben's inconsistent state-
ments. PFR at 23-24.  According to the appellants,
Ben originally denied any knowledge of the con-
struction of a fish pond, but later, when he allegedly

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80a

sought reemployment by the agency, he remembered
the events in question. Id. The administrative judge
considered the possibility that Ben, Slim, and Etsitty
fabricated their testimony in an effort to gain re-
employment by the agency but, as discussed above, he
found that not to be the case.  RID at 13.  We believe
that it is more likely that Ben initially denied
knowledge of the fish pond project in order to protect
himself and subsequently decided to reveal the truth.
    The appellants also argue that the administrative
judge failed to address a number of inconsistencies in
the testimony of key agency witnesses and failed to
address inconsistencies in the statements, deposition,
and hearing testimony of the individual witnesses.
PFR at 17-21.  For example, Etsitty testified that he
watched Roberts depart from the agency facility in
the agency pickup truck on his way to the concrete
pour and that Barrett was on the passenger side of
the seat and Ben was in the middle. HT at 8.  In
contrast, Ben initially testified that Roberts was on
the passenger side, but later testified that Barrett
was on the passenger side. HT at 38, 43-44.  Simi-
larly, Etsitty contended in his initial statement that
he helped `load shovels, hammers, and power tools"
into the pickup truck, but at the hearing he testified
that he loaded shovels, picks, and trowels into the
pickup truck. 3.  IAF 3, Tab 3, Subtab 40;  HT at 13. Ben
testified, however, that there were only a couple of
shovels in the back of the pickup truck.  HT at 38.

___________________(footnotes)

    3  To the extent that the appellants refer to Etsitty's depo-
sition in their petition for review, we have previously held that
we will not consider it under 5 C.F.R.  1201.115. Barrett, 57
M.S.P.R. at 638 n. 5.

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81a

    Although the administrative judge did not mention
every inconsistency in the statements and hearing
testimony of Etsitty, Slim, and Ben, the administra-
tive judge discussed several of the inconsistencies
and found that they did not affect the credibility of the
three witnesses. RID at 13.  The fact that the admin-
istrative judge did not mention every inconsistency
does not mean that he did not fully consider all of the
evidence.  Marques, 22 M.S.P.R. at 132.  In any event,
we have fully considered the inconsistencies cited
above and all of the other inconsistencies cited by the
appellants in their petition for review and find that
the appellants have failed to show that the administra-
tive judge erred in his fact findings.
    The appellants also argue that the administrative
judge failed to consider that Etsitty admitted that he
had no independent recollection of the date of the
concrete pour and that he only remembered the exact
date after the agency representative informed him of
it. PFR at 22-23.  Although the appellants' assertion
is true, the fact that Etsitty had no independent re-
collection of the date on which the concrete pour
occurred does not reduce the probative value of his
testimony regarding the events on the date of the
concrete pour.
    Thus, we believe that the administrative judge
correctly found the testimony of Etsitty, Ben, and
Slim credible.  See Hillen, 35  M.S.P.R. at 458.  Al-
though there may be some inconsistency regarding
the details, they provided consistent testimony
regarding the core issues in this appeal.  That testi-
mony is also consistent with Martin's testimony.

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82a

The administrative judge correctly found Liggins
and Moser not credible.

    On review, the appellants also argue that the ad-
ministrative judge erred in his credibility  determina-
tions regarding Liggins and another friend of Wig-
gins who allegedly assisted in the fish pond project,
John Moser. PFR at 24-27.  Liggins testified that he
helped Wiggins with the fish pond project for 4 days,
Friday through Monday.  HT at 207-08.  He testified
that he helped set the forms for the fish pond and that
"on that weekend we poured cement for it, and the
following Monday we finished up." HT at 207.  Sub-
sequently, however, Liggins testified that during the
week the work on the fish pond required hammers and
hand saws and that, on Friday, Wiggins was assisted
by himself, two day laborers, and individuals named
John and Andy  HT at 208.  Liggins testified that he
did not know Barrett and that Barrett was not
present at any time, and that he knew Roberts and
Slim and that they were not present on either day.
HT at 209-10.
    Moser testified that he helped dig the hole for the
fish pond and helped pour the cement for the fish pond
approximately a week later. HT at 153.  He testified
that Wiggins was assisted in pouring the cement
by Liggins, an individual named Andy, and two day
laborers.  Id. Moser also testified that neither
Roberts nor Barrett was present at the cement pour
and that he did not know Ray Ben. HT at 153-55.
    The administrative judge discredited Liggin's
testimony because he testified that he completed the
cement forms over the weekend and that the cement
was poured on a Monday. RID at 9.  The evidence
reflects that the cement was poured on a Thursday.

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83a

With regard to Moser's testimony, the administrative
judge discredited it because the appellants did not
offer Moser as an exculpatory witness until the time
of the first hearing and they did not identify him as a
source of evidence in their reply to the notice of
proposed removal or in their petitions for appeal. RID
at 9.  The administrative judge also noted that both
Liggins and Moser admitted that they were longtime
friends of Wiggins. Id.; HT at 151-52, testimony of
Moser;  HT 206-07, testimony of  Liggins.
    With regard to Liggins, we note that the admin-
istrative judge correctly discredited his testimony
because of the inconsistencies in his testimony re-
garding the day of the week of the cement pour.
Liggins' misstatement about the date of the cement
pour is not a minor error, such as stating the cement
was poured on Wednesday or stating that it occurred
on June 8, 1988, but rather goes to the heart of his
version of how the project was done and calls his
credibility into question.  In addition, as noted by the
administrative judge, Liggins is a personal friend of
Wiggins. RID at 9.  Finally, to believe Liggins'
version of events, it is necessary to reject the credi-
ble and consistent testimony of Etsitty, Ben, Slim,
and Martin.  See Hillen, 35 M.S.P.R. at 458.
    After reviewing Moser's testimony, the administra-
tive judge's findings regarding this testimony, and
the appellants' assertions on review, we find that the
administrative judge's reasoning in discrediting
Moser's testimony was faulty.  See RID at 9; PFR at
24-27.  We find that the fact that the appellants did not
offer Moser as a witness before the agency or in their
petitions for appeal is not a proper basis to discredit
his testimony in these appeals.  The point in time at
which a witness is first presented for consideration is

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84a

not, by itself, an appropriate basis by which to deter-
mine credibility.  See Hillen, 35 M.S.P.R. at 458.
    Based on the other evidence in the record, however,
we believe that the administrative judge correctly
discredited Moser's testimony.  As noted by the
administrative judge, Moser is a personal friend of
Wiggins and, more importantly, to believe his version
of events, it is necessary to reject the credible and
consistent testimony of Etsitty, Ben, Slim, and Mar-
tin.  See Hillen, 35 M.S.P.R.  at 458.

The administrative judge correctly found the appel-
lants' testimony not credible.

    The appellants also argue on review that the
administrative judge erred in not properly consider-
ing their testimony, particularly in light of their
combined 38 years of agency employment, their good
work records, their positions of authority, and the
fact that Roberts and Barrett are still employed by
the agency.  PFR at 28-29.  Contrary to the appel-
lants' assertions, the administrative judge considered
the appellants' testimony and simply found them not
credible. RID at 6, 10.  With regard to the specific
factors cited by the appellants on review, they are
irrelevant to a valid credibility determination.  See
Hillen, 35 M.S.P.R.  at 458.
    The appellants also argue that the administrative
judge failed to consider the documentary and testi-
monial evidence that showed that Roberts and
Barrett were at work on June 9, 1988.  PFR at 29-32.
The administrative judge fully considered this evi-
dence and concluded that it did not support the
appellants' version of events.  RID at 10-11.  Simi-
larly, the administrative judge fully considered the
significance of the pickup truck mileage log and

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85a

concluded that it did not support the appellants'
version of events. RID at 11.  The appellants' allega-
tions on review constitute mere disagreement with
the administrative judge's explained fact findings.
With regard to the appellants' claim that it is in-
herently unlikely that Barrett and Roberts would
have the foresight to falsify the laboratory report and
vehicle mileage log more than a year in advance of any
disciplinary action, we note that it is not uncommon
for individuals to cover up evidence of their wrong-
doing.

The administrative judge correctly sustained four of
the charges against Wiggins and one of  the charges
against Barrett and Roberts.

    Based on the discussion above, we find that the
administrative judge correctly sustained the charges
that Wiggins misused a government vehicle, misused
government equipment, and misused government em-
ployees. RID at 15-16.  We also find that the admin-
istrative judge correctly sustained the charge that
Wiggins falsified government time and attendance
reports by representing that his subordinates were
on duty when they were assisting with the cement
pour. RID at 16.  The administrative judge did not
sustain the final charge against Wiggins of making a
false claim on his own time and attendance report,
RID at 2 n. 1, and the agency has not petitioned for
review of that finding.  Thus, we will not consider the
charge further.  We also find that the administrative
judge correctly found that Barrett and Roberts made
a false claim on their respective time and attendance
reports when they represented that they were on
duty during the time period that they were assisting
with the cement pour. RID at 17.

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86a

    With regard to the charge that Barrett and Roberts
misrepresented or concealed a material fact in con-
nection with an agency investigation, the agency
alleged that, when the area personnel officer inquired
about the misconduct, Barrett and Roberts provided
false information. IAF 1, Tab 3, Subtab 4h; IAF 2, Tab
3, Subtab 4h. According to the agency, Roberts stated
in response to the inquiry that he did not remember
anything about the building of a fish pond, while
Barrett stated that he only worked on the fish pond on
his own time. IAF 1, Tab 3, Subtab 4h; IAF 2, Tab 3,
Subtab 4h. The agency also charged that Barrett and
Roberts failed to report an act of fraud, waste, and
abuse when they failed to disclose to agency officials
that Wiggins did not charge them leave for the time
that they worked on the fish pond.  IAF 1, Tab 3,
Subtab 4h; IAF 2, Tab 3, Subtab 4h.  The administra-
tive judge sustained these charges. RID at 16-17.
    After the remand initial decision was issued, the
Board issued Walsh v. Department of Veterans
Affairs, 62 M.S.P.R. 586 (1994).  In Walsh, 62
M.S.P.R. at 594, we recognized that the Board had
previously held, as did the administrative judge in
this appeal, that an agency may separately charge an
employee with misconduct and with making false
statements about the alleged misconduct, when the
falsification concerns a matter of official interest to
the agency.  We determined in Walsh, however, that
these holdings were based on a faulty analysis of the
decision of the U.S. Court of Appeals for the Federal
Circuit in Grubka v. Department of the Treasury,
858 F.2d 1570, 157475 (Fed. Cir. 1988), holding that
such a charge was erroneous as a matter of law.  We
therefore held, following Grubka, that an agency may
not separately charge an employee with misconduct

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87a

and with making false statements regarding the
alleged misconduct. Walsh, 62 M.S.P.R. at 594-95.
    Thus, in these appeals, based on our decision in
Walsh, we find that the agency's charge against
Barrett and Roberts of misrepresentation or conceal-
ment of a material fact in connection with an investi-
gation is improper, and the administrative judge erred
as a matter of law by sustaining them.  Id., at 595.
With regard to the charge that Barrett and Roberts
failed to report an act of fraud, waste, and abuse by
Wiggins, that charge means that Barrett and Roberts
were required to report Wiggins' misconduct of not
charging them leave for the time during which they
worked on the fish pond during duty hours. Such a
disclosure, however, would have necessitated impli-
cating themselves in the misconduct of filing a false
time and attendance report.  A charge based on such a
requirement of self-implication is contrary to our
decision in Walsh, and thus the administrative judge
erred as matter of law by sustaining the charge that
Barrett and Roberts failed to report such an act of
fraud, waste, and abuse. 4.  Id., at 595.
    Although not cited by the agency, we note that 5
C.F.R.  2635.10l(b)(11) sets forth the ethical require-
ment that Federal employees "shall disclose waste,
fraud, abuse, and corruption to appropriate authori-
ties." We discern nothing in the regulation, however,
that calls into question the discussion above and the
Board's holding in Walsh regarding self-implication.
Accordingly, we find that, despite the requirement
of 5 C.F.R.  2635.10l(b)(11), an employee cannot be

___________________(footnotes)

    4  Our holding in no way precludes an agency from bring-
ing a charge of engaging in waste, fraud, and abuse, or similar
charges under other circumstances.

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88a

required to make a disclosure that would implicate
himself or herself in wrongdoing.  See Walsh, 62
M.S.P.R. at 595; see also Walsh, concurring opinion
of Chairman Erdreich, at 599 (stating that the
charge of making false statements in an agency
investigation must be set aside as inconsistent with
Federal Circuit precedent despite statutory and
regulatory admonitions requiring truthfulness of
Federal employees).

    The penalty imposed by the agency against Wiggins
was within the tolerable limits of reasonableness.

    The administrative judge considered the penalty
imposed by the agency against Wiggins in light of the
fact that he did not sustain all of the charges. RID at
19-20. The administrative judge determined that re-
moval was within the tolerable limits of reasonable-
ness for Wiggins' misconduct. RID at 17-20. We have
considered the arguments on review, and find that the
administrative judge did not err in his determination.

    The maximum reasonable penalty for the sustained
misconduct of Barrett and Roberts is a letter of
reprimand.

    Regarding the penalties imposed against Barrett
and Roberts, when not all of the charges are sus-
tained, the Board will consider carefully whether the
sustained charges merit the penalty imposed by the
agency. McIntire v. Federal Emergency Manage-
ment Agency, 55 M.S.P.R. 578, 588 (1992); Douglas v.
Veterans Administration, 5 MSPB 313, 5 M.S.P.R.
280, 308 (1981). In Douglas, 5 M.S.P.R. at 305, the
Board articulated a number of factors to consider in
determining the appropriateness of a penalty.

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89a

    Here, Barrett and Roberts engaged in misconduct
by falsely claiming on their time and attendance
reports that they were at work while assisting
Wiggins with the fish pond, The Board has held that
the falsification of a time and attendance report is a
serious offense that can warrant removal. See Rohn
v. Department of the Army, 30 M.S.P.R. 157, 158-59
(1986).  Whether a particular act of falsification
warrants removal must be determined in light of the
circumstances of each case. Perez v. U.S. Postal
Service, 48 M.S.P.R. 354,356-57 (1991).
    In these appeals, we find that there are a number of
facts that support a lesser penalty than the demotions
and suspensions imposed by the agency.  The length
of time involved is only 2 hours and, because Barrett
and Roberts spent the time working at their supervi-
sor's residence, we cannot find that they acted for
personal gain.  Also, they acted with the knowledge
and approval of their supervisor.  In addition, the
agency cited no prior disciplinary actions against
either Barrett or Roberts and, at the time of the
agency's actions, Barrett had approximately 18 years
of service with the agency and approximately 24 years
of Federal service, and Roberts had 4 years of service
with the agency and nearly 7 years of Federal service.
    Accordingly, in light of all of the circumstances in
these appeals, we find that a letter of reprimand is the
maximum reasonable penalty for the sustained mis-
conduct of  Barrett and Roberts.  This finding is
consistent with the finding in Coppola v. U.S. Postal
Service, 47 M.S.P.R. 307, 315, 319 (1991), where the
Board held that a letter of reprimand was the maxi-
mum reasonable penalty for a single instance of 32 to
37 minutes of absence without leave.

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ORDER

    We ORDER the agency to cancel the demotions and
suspensions of Barrett and Roberts and to replace
those actions with a letter of reprimand. See Kerr v.
National Endowment for the Arts, 726 F.2d 730 (Fed.
Cir. 1984).  The agency must accomplish these actions
within 20 days of the date of this decision.
    We also ORDER the agency to issue checks to
Barrett and Roberts for the appropriate amount of
back pay, interest on back pay, and other benefits
under the Office of Personnel Management's regula-
tions, no later than 60 calendar days after the date of
this decision.  We ORDER Barrett and Roberts to
cooperate in good faith in the agency's efforts to
compute the amount of back pay, interest, and benefits
due, and to provide all necessary information the
agency requests to help it comply.  If there is a dis-
pute about the amount of back pay, interest due,
and/or other benefits, we ORDER the agency to issue
checks to Barrett and Roberts for the undisputed
amount no later than 60 calendar days after the date
of this decision.
    We further ORDER the agency to inform Barrett
and Roberts in writing of all actions taken to comply
with the Board's Order and of the date on which the
agency believes it has fully complied.  If not notified,
Barrett and Roberts should ask the agency about its
efforts to comply.
    Within 30 days of the agency's notification of com-
pliance, Barrett and Roberts may file a petition for
enforcement with the regional office to resolve any
disputed compliance issue or issues.  The petition
should contain specific reasons why Barrett and
Roberts believe that there is insufficient compliance,

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91a

and should include the dates and results of any
communications with the agency about compliance.
    This is the final order of the Merit Systems Pro-
tection Board in these appeals. 5 C.F.R. 1201.113(c).

NOTICE TO APPELLANTS

    You have the right to request the United States
Court of Appeals for the Federal Circuit to review the
Board's final decision in your appeal if the court has
jurisdiction.  See 5 U.S.C.  7703(a)(1).  You must sub-
mit your request to the court at the following
address:

          United States Court of Appeals
             for the Federal Circuit
           717 Madison Place, N.W.
             Washington, DC 20439

    The court must receive your request for review no
later than 30 calendar days after receipt of this order
by your representative, if you have one, or receipt by
you personally, whichever receipt occurs first.  See 5
U.S.C.  7703(b)(1).
    Member Amador issues an opinion concurring in
part and dissenting in part.
For the Board

ROBERT E. TAYLOR,

WASHINGTON, D.C.

SEPARATE OPINION OF MEMBER ANTONIO C.
AMADOR.

    Although I concur in all other aspects of the
Board's decision, I respectfully dissent from the ma-
jority's mitigation of the penalty to be imposed upon
Barrett and Roberts.  I agree that, in light of the

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92a

Board's reversal of three of the four charges against
Barrett and Roberts, the agency-imposed penalty
should be mitigated.  However, I believe that a mere
reprimand is an entirely inappropriate and unreason-
able penalty in light of the seriousness of the sus-
tained charges of falsification of time and attendance
reports.  Moreover, it is entirely inconsistent with
the Board's treatment of falsification cases in the
past.  A 30-day suspension, at a minimum, would be
more appropriate and would meet the Board's respon-
sibility to bring the penalty within the parameters of
reasonableness.  Montalvo  v. U.S. Postal Service, 50
M.S.P.R. 48,51 (1991).
    In this case, there are aggravating factors which
must be considered in tandem with the mitigating
factors noted by the majority.  The Board is unani-
mously sustaining the removal of Wiggins for misus-
ing a government vehicle, government equipment, and
government employees.  It is thus inappropriate, in
determining the appropriate penalty to impose on
Barrett and Roberts, to overlook the Board's con-
clusion that the two were willing participants in an
act of fraud, waste, and abuse, having driven a govern-
ment pickup truck with government equipment to
Wiggins' house, and having falsified their duty logs
and the truck's mileage log to conceal their actions.
    I agree that, in the context of this case, Barrett and
Roberts cannot be charged with failing to come
forward to report this fraud, waste, and abuse, as such
a report would have placed them in the position of
disclosing their own misconduct.  See maj. at 201-202.
However, their willing participation in the under-
lying misconduct should certainly be considered in
determining the reasonableness of the penalty.  This
case is, therefore, quite distinguishable from Coppola

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93a

v. U.S. Postal Service, 47 M.S.P.R. 307(1991), where-
in Coppola extended his lunch hour by 32 to 37
minutes on one occasion.  By contrast, not only were
Barrett and Roberts absent from duty, an absence
covered up with false time and attendance report
claims, but additionally, during that brief absence,
they were willing participants in several counts of
fraud, waste, and abuse.  Although the amount of time
that they were absent from work was brief, this is not
a mere absence-without-leave case, and it is quite in-
credible that the majority treats it as such.  Barrett's
and Roberts' unauthorized absence, which they at-
tempted to cover up by falsifying their time and attain-
dance reports, was attributable to their participation
in illegal activity.
    The majority opinion makes note of the fact that
Barrett and Roberts were doing personal work for
their supervisor with his knowledge and approval as
support for mitigation to a reprimand.  However, this
personal work involved misutilization of government
equipment and a government vehicle, as well as the
involvement of other employees who, along with the
appellants, were charging their "personal work" to
the government.  The appellants clearly knew that
this "personal work" was not authorized-they at-
tempted to cover their tracks by falsifying the daily
log and the truck mileage log.  Moreover, it is of little
relevance that they were acting with the knowledge
and approval of their supervisor such circumstances
would not excuse shoplifting or bank robbery!
    As the majority opinion acknowledges, the Board
has held that the penalty of removal maybe appropri-
ate in falsification cases, depending on the facts of the
individual case.  See maj. at 202.  The substance of a
falsification charge is the issue of an employee's

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94a

honesty. Beardsley v. Department of Defense, 55
M.S.P.R. 504, 511 (1992), aff'd, 5 F.3d 1504 (Fed. Cir.
1993) (Table).  An employee's falsification of an
agency document goes to the core of the employer-
employee relationship and impeaches the employee's
reliability, veracity, trustworthiness, and ethical
conduct.  Wier v. Department of the Army, 54
M.S.P.R. 348,354 (1992); Hanna v. Department of the
Army, 42 M.S.P.R. 233,240 (1989).  On more than one
occasion, the Board has held that removal for falsi-
fication of government documents promotes the effi-
ciency of the service because such falsification raises
serious doubts regarding the employee's honesty and
fitness for employment.  See Hamilton v.  Depart-
ment of the Air Force, 52 M.S.P.R. 45,47 (1991), aff'd,
980 F.2d  744 (Fed. Cir. 1992) (Table); see also  Kuhn v.
Federal Deposit Insurance Corporation, 48 M.S.P.R.
393, 398-99 (1991) (removal was within the tolerable
limits of reasonableness where the offense of inten-
tional submission of an incorrect travel voucher
raised serious doubts as to the employee's trust-
worthiness and reliability), aff'd, 954 F.2d 734 (Fed.
Cir. 1992) (Table); Gonzalez  v. US. Postal Service, 30
M.S.P.R. 82, 85-86 (1986) (where the Board failed to
sustain the charges of lying to postal investigators
and failure to cooperate in a postal investigation, the
charge of filing a false travel voucher and supporting
documentation was sufficient to warrant removal due
to the irretrievable loss of trust and confidence in the
employee's integrity, veracity, and value as a govern-
ment witness), aff`d, 818 F.2d 874 (Fed. Cir. 1987)
(Table); Trybul v. Department of the Army, 22
M.S.P.R. 290,292 (1984), aff'd, 776 F.2d 1059 (Fed. Cir.
1985) (Table); Martinez  v. Department of Defense, 21
M.S.P.R. 556, 558 (1984) (removal penalty sustained,

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95a

despite the de minimis amount of money involved in
the false travel vouchers and the employee's long-
standing successful service, where the agency
demonstrated that the falsification of a travel voucher
directly related to employee's performance of his
official duties and had a negative effect upon his
supervisor's confidence in him and ability to trust
him), aff'd, 765 F.2d 158 (Fed. Cir. 1985) (Table);
Stokes v. Department of Agriculture, 9 MSPB 22, 9
M.S.P.R. 372, 376 (1982) (the Board sustained the
removal of the employee for falsification of a travel
voucher and supporting documents); Initial Decision
at 7.
     Recently, in Tanner v. Department of Transporta-
tion, 65 M.S.P.R. 169 (1994) (Chairman Erdreich dis-
senting), the Board similarly reversed a charge of
misrepresentation, per Walsh, but upheld the penalty
of removal in a case involving a falsification of a travel
voucher.  As in the instant case, the appellant's falsi-
fication of records raised serious concerns about her
judgment, reliability, veracity, trustworthiness, and
ethical conduct. Maj. at 194. In another recent de-
cision, Wier, 54 M.S.P.R. at 354-55, the Board found
that a 30-day suspension was a reasonable penalty for
an employee's filing of a false travel voucher, despite a
number of mitigating factors.  In Hart v. U.S. Postal
Service, 53 M.S.P.R. 228, 231-32 (1992), the Board
mitigated a 60-day suspension to a 30-day suspension
for the employee's falsification of his time and
attendance report by 1 hour.  In Parsons v. Depart-
ment  of the Air Force, 21 M.S.P.R. 438, 446 (1984), the
Board mitigated a removal to a 45-day suspension for
falsifying a sick leave form and for being absent with-
out leave for a day.

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96a

    Certainly, the actions of Barrett and Roberts with
regard to the "fish pond" incident were no less
serious then the offenses of  Wier, Hart, and Parsons
(Tanner's falsification was more serious, due to her
supervisory position).  Thus, in light of the specific
circumstances of this case, a similar substantial
penalty in the form of a suspension is appropriate.
    The Board majority's decision to instead mitigate
the penalty to a mere reprimand illustrates, once
again, the current Board's general disregard for its
own precedent (which the majority decision con-
sciously ignores, citing only the Coppola decision as
support for its mitigation of the penalty to a re-
primand; as noted above, the Coppola case involved a
far less serious offense than the instant case), its
willing usurpation of the agency's role in determining
the appropriate penalty, and the current Board's
arbitrariness and inconsistency in reviewing the
agency's selection of a penalty (indeed, this inconsis-
tency is demonstrated by the removal penalty imposed
upon Wiggins, in contrast to the reprimands applied
to his accomplices).  Accordingly, I strongly dissent
from this aspect of the Board majority's decision.

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APPENDIX G

UNITED STATES OF AMERICA
MERIT SYSTEMS PROTECTION BOARD

  No. AT-0752-94-0313-I-1

HARRY R. MCMANUS, APPELLANT

v.

DEPARTMENT OF JUSTICE, AGENCY

MERIT SYSTEMS PROTECTION BOARD

[Filed: Feb. 17, 1995]

Before: ERDREICH, Chairman, PARKS, Vice Chair-
   man, and AMADOR, Member.

OPINION AND ORDER

    The agency has petitioned for review of an initial
decision that mitigated the appellant's demotion to a
14-day suspension.  For the reasons set forth below,
we DENY the petition for failure to meet the criteria
for review under 5 C.F.R. 1201.115, REOPEN the
appeal on our own motion under 5 C.F.R.  1201.117,
and AFFIRM the initial decision AS MODIFIED by
the Opinion and Order, still MITIGATING the appel-
lant's demotion to a 14-day suspension.

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BACKGROUND

    The appellant petitioned for appeal from the
agency's action demoting him from the position of
Supervisory Correctional Officer, GS-11, step 3, to
the position of  Correctional Officer, GS-8, step 10.  See
Initial Appeal File (IAF), Tab 1; Tab 4, Subtab 4a. The
agency based its action on charges of conduct unbe-
coming a supervisor and making false statements
during an official investigation.  See id., Tab 4, Sub-
tabs 4b, 4g.
    Concerning the former charge, the agency asserted
that the appellant had admitted during an interview
"to making various sexual innuendoes to a female
subordinate." See id., Tab 4, Subtab 4g.  The record of
that interview shows that he admitted having engaged
in a conversation with the subordinate (Officer White)
in which he referred to "a bra size;" asked her about
her preferred sexual positions; told her he had a
"bulge" in his pants thinking about the subject; and
"made a reference to the effect of  Can you see how
much you excite me?' " when talking to Officer White.
See id., Tab 4, Subtab 41.  Regarding its other charge,
the agency produced a sworn statement from the
appellant admitting that he had lied during another
investigative interview regarding these comments.
See id., Tab 4, Subtab 4m.
    The appellant waived his right to a hearing, so the
case was decided based upon the written record.  See
id., Tab 1; Initial Decision (I.D.) at 1-2.  The admin-
istrative judge sustained both charges.  He found that
the appellant had made sexual comments to Officer
White. See I.D. at 2-3.  The administrative judge also
concluded that the appellant had submitted a state-
ment during an investigation denying that he had

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99a

made such remarks with the intent to deceive the
agency. See id. at 3-5.
    Nevertheless, he mitigated the demotion to a 14-day
suspension.  See id. at 6-7.  The administrative judge
conceded that, under the agency's table of penalties, a
charge of conduct unbecoming would warrant a pen-
alty ranging from official reprimand to removal. See
id. at 6, citing IAF, Tab 4, Subtab 4q.  He found, how-
ever, that joking sexual conversations were common
in the workplace and that Officer White often partici-
pated in or initiated them.  See id. at 3 n. 2, 7, citing
IAF, Tab 4, Subtabs 4e, 4n.  He concluded regarding
the comments at issue that "[t]he agency's penalty
may have been warranted had the comments been
totally unwelcome and not mutually exchanged
between the appellant and Officer White, but such was
not the case here."  See id. at 6-7 (emphasis in
original).  He also noted that the appellant had eleven
years of service with the agency without prior disci-
pline.  See  id. at 7. For those reasons, the administra-
tive judge mitigated the agency's penalty selection.
See id.  The agency has petitioned for review of the
initial decision, contending that the administrative
judge erred in mitigating the penalty.  See Petition
for Review File (PFRF), Tab 1.

ANALYSIS

    When the administrative judge issued his initial
decision, he did not have the benefit of the Board's
decision in Walsh v. Department of Veterans Affairs,
62 M.S.P.R. 586, 593-96 (1994).  Relying on the court's
decision in Grubka  v. Department of the Treasury,
858 F.2d 1570, 1574-75 (Fed. Cir. 1988), the Board held
that an agency may not charge an employee with
misconduct and separately charge her with making a

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100a

false statement regarding the alleged misconduct.
See Walsh, 62 M.S.P.R. at 593-96.  As discussed above,
the agency charged the appellant here with conduct
unbecoming a supervisor and with making false state-
ments concerning that conduct.  See IAF, Tab 4,
Subtab 4g.  In accordance with Walsh, then, the latter
charge was improper and may not be considered. See
62 M.S.P.R. at 595-96.  When the Board does not sus-
tain all of the agency's charges and specifications, we
must carefully consider whether the sustained
misconduct merits the penalty imposed by the agency.
See Douglas v. Veterans Administration, 5 MSPB
313, 5 M.S.P.R. 280, 308 (1981).  In doing so, we
analyze whether the agency conscientiously consid-
ered all the relevant factors and exercised manage-
ment discretion within tolerable limits of reason-
ableness.  See id., 5 M.S.P.R. at 306.
    Regarding the penalty issue, the agency asserts
that the false statement made by the appellant re-
garding his comments to Officer White should be
considered for the purpose of  impeaching his credibil-
ity.  It contends that the Board should therefore
credit Officer White's account over the appellant's
and determine that she was not a willing participant
in conversations of a sexual nature with the appellant.
On that basis, the agency argues, mitigation of the
penalty is not warranted. See PFRF, Tab 1 at 6-7. In
Walsh, however, the Board held that a false denial of
misconduct cannot result in harm to the accused and
that an appellant's false statements thus may not be
considered in determining the penalty.  See 62
M.S.P.R. at 595-96.  We therefore reject the agency's
argument and decline to consider the appellant's false
statement in analyzing the penalty issue.

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101a

    The record contains a statement by the appellant
that sexual joking and innuendo were common in the
workplace and that Officer white had a practice of
engaging in sexually explicit conversations; he also
maintained that her complaint about his comments to
her had been motivated by her unhappiness about his
criticism of  her work performance.  See IAF, Tab 4,
Subtab 4e-1.  Nothing in the record specifically con-
tradicts the remarks about the office environment and
Officer White's alleged practice.  A statement by
another employee asserted that Officer White had
been a willing participant in sexually explicit conver-
sations and had engaged in sexually provocative
behavior.  See id., Tab 4, Subtab 4f. Moreover, Officer
White admitted that she had initially participated in
sex-related joking with the appellant, although she
also alleged that she had later become uncomfortable
with the joking and had told him that he could get in
trouble for making such comments; she contended
that she had then told him (apparently after the
comments at issue had been made) that he should
leave her alone.  See id., Tab 4, Subtab 4n-12.  The
appellant, however, has consistently denied that Offi-
cer White ever specifically discouraged his remarks.
See id., Tab 4, Subtabs 4e-1, 4i, 4l, 4n-3.  The record
also does not contain any first-hand accounts by other
individuals confirming Officer White's account of this
matter.  In addition, another statement in the record
by Officer White provides some support for the appel-
lant's assertion that she was angry about his criti-
cism of her work performance.  See id., Tab 4, Subtab
4n-11.
    Based on our review of the record, then, it appears
undisputed that sexual joking and innuendo did occur
in the workplace and that Officer White willingly par-

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102a

ticipated in at least some of that activity.  The agency
nonetheless argues that the appellant's misconduct
was highly serious, especially for a supervisory em-
ployee in a correctional facility, and that the exis-
tence of an atmosphere in which Officer White and
others made sex-related jokes and comments is there-
fore irrelevant to the penalty issue.  See PFRF, Tab 1
at 2-5.  As an initial matter, we certainly agree that
the appellant's comments were improper.  Supervi-
sors are held to a higher standard of conduct than
other employees, and they have a responsibility to
ensure that the work environment is free of offensive
comments of a sexual nature.  See Kirk v. Depart-
ment of the Navy, 58 M.S.P.R. 663, 671-72 (1993);
Jackson v. U.S. Postal Service, 48 M.S.P.R. 472, 476
(1991).  Moreover, correctional officers must conform
to a higher standard of conduct than non-law enforce-
ment employees, and the Department of Justice is
permitted wide discretion in controlling the work-
related conduct of those employees charged with
maintaining the integrity of our prison system.  See
Crawford v. Department of Justice, 45 M.S.P.R. 234,
237 (1990).
    Contrary to the agency's argument, however, see
PFRF, Tab 1 at 5, we have not held that the office
environment is irrelevant to the penalty issue in
cases like this one.  The holding cited by the agency
states that an office atmosphere of sexual joking and
innuendo would not be considered on the issue of
whether the charge of conduct unbecoming a super-
visor/sexual harassment could be sustained; that
holding did not address the issue of whether the
penalty imposed was reasonable.  See Lowe v. Depart-
ment of Justice, 63 M.S.P.R. 73, 76-77 (1994). More-
over, in analyzing whether mitigation was warranted

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103a

in cases involving sexual misconduct, the Board has
explicitly considered whether an office atmosphere of
sexual joking existed and whether the misconduct at
issue fell within the bounds of such an atmosphere or
surpassed it.  See Jordan v. U.S. Postal Service, 44
M.S.P.R. 225, 232-33 (1990), reconsideration denied,
49 M.S.P.R. 544 (1991); Vaughan v. Department of the
Navy, 40 M.S.P.R. 411, 417-18 (1989).  We therefore
reject the agency's argument that this issue may not
be considered in reviewing the penalty issue.
    As the administrative judge noted, the appellant had
11 years of service with the agency and does not
appear to have been disciplined during that period.
See I.D. at 7; IAF, Tab 4, Subtab 4a. Moreover, the
sexual misconduct discussed above did not involve any
physical contact with Officer White.  See Alsedek v.
Department of the Army, 58 M.S.P.R. 229,241 (1993)
(physical contact in sexual misconduct cases is an
aggravating factor which may warrant a more severe
penalty than might otherwise be imposed).  Finally, it
appears that the appellant's sexual comments to
Officer White were made in an environment in which
such remarks were common and in which Officer
White also participated.  See Jordan, 44 M.S.P.R. at
232-33; Vaughan, 40 M.S.P.R. at 417-18. Therefore,
even after considering the undisputed seriousness of
the appellant's misconduct, we find that the adminis-
trative judge did not err in mitigating his demotion to
a 14-day suspension.

ORDER

    We ORDER the agency to cancel the appellant's
demotion and to substitute a 14-day suspension with-
out pay, retroactive to the effective date of the demo-
tion, January 9, 1994.  See Kerr v. National Endow-

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104a

ment for the Arts, 726 F.2d 730 (Fed. Cir. 1984).  The
agency must accomplish this action within 20 days of
the date of this decision.
    We also ORDER the agency to issue a check to the
appellant for the appropriate amount of back pay,
interest on back pay, and other benefits under the
Office of Personnel Management's regulations, no
later than 60 calendar days after the date of this
decision.  We ORDER the appellant to cooperate in
good faith in the agency's efforts to compute the
amount of back pay, interest, and benefits due, and to
provide all necessary information the agency re-
quests to help it comply.  If there is a dispute about
the amount of back pay, interest due, and/or other
benefits, we ORDER the agency to issue a check to
the appellant for the undisputed amount no later than
60 calendar days after the date of this decision.
    We further ORDER the agency to inform the appel-
lant in writing of all actions taken to comply with the
Board's Order and of the date on which the agency
believes it has fully complied.  If not notified, the
appellant should ask the agency about its efforts to
comply.
    Within 30 days of the agency's notification of com-
pliance, the appellant may file a petition for enforce-
ment with the regional office to resolve any disputed
compliance issue or issues.  The petition should con-
tain specific reasons why the appellant believes that
there is insufficient compliance, and should include
the dates and results of any communications with the
agency about compliance.
    This is the final order of the Merit Systems Pro-
tection Board in this appeal. 5 C.F.R.  1201.113(c).

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105a

NOTICE TO APPELLANT

    You have the right to request the United States
Court of Appeals for the Federal Circuit to review the
Board's final decision in your appeal if the court has
jurisdiction. See 5 U.S.C.  7703(a)(l). You must sub-
mit your request to the court at the following ad-
dress:
           United States Court of Appeals
                for the Federal Circuit
              717 Madison Place, N.W.
               Washington, DC 20439

    The court must receive your request for review no
later than 30 calendar days after receipt of this order
by your representative, if you have one, or receipt by
you personally, whichever receipt occurs first. See 5
U.S.C.  7703(b)(l).

For the Board:

ROBERT E. TAYLOR,

WASHINGTON, D.C.

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106a              

APPENDIX H


UNITED STATES COURT OF APPEALS
FOR THE FEDERAL CIRCUIT          

No. 96-3.028

JAMES B. KING, DIRECTOR            
OFFICE OF PERSONNEL MANAGEMENT         

v.

HARRY R. MCMANUS, RESPONDENT
AND                
MERIT SYSTEMS PROTECTION BOARD
RESPONDENT

ORDER

[Filed Nov. 4, 1996]

    A combined petition for rehearing and suggestion
for rehearing in banc having been filed by the
PETITIONER, and the petition for rehearing having
been referred to the panel that heard the appeal, and
thereafter the suggestion for rehearing in bane
having been referred to the circuit judges who are in
regular active service,
UPON CONSIDERATION THEREOF, it is
    ORDERED that the petition for rehearing be, and
the same hereby is, DENIED and it is further
ORDERED that the suggestion for rehearing in
bane be, and the same hereby is, DECLINED.

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107a

    The mandate of the court will issue on November
12,1996.

Dated November 4,1996

FOR THE COURT,
MELVIN L. HALPERN, ACTING CLERK

 By /s/ BRIAN P. LEDUC      
 BRIAN P. LEDUC
  Associate Chief Deputy Clerk

cc:  TODD M. HUGHES
  MARTHA B. SCHNEIDER

KING V MCMANUS, 96-3028
(MSPB - AT0752940313R-1)

    Note: Pursuant to Fed. Cir. R. 47.6, this order is
not citable as precedent. It is a record.

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108a

APPENDIX I

UNITED STATES COURT OF APPEALS
FOR THE FEDERAL CIRCUIT

NOS. 95-3745,-3746

JAMES B. KING, DIRECTOR
OFFICE OF PERSONNEL MANAGEMENT
PETITIONER

v.

LESTER E. ERICKSON, JR.,  RESPONDENT

AND

JEANETTE M. WALSH, RESPONDENT
MICHAEL G. BARRETT AND JEROME K. ROBERTS
RESPONDENTS
SHARON KYE, RESPONDENT
MERIT SYSTEMS PROTECTION BOARD
RESPONDENT

ORDER

[Filed: Nov. 4, 1996]

    A combined petition for rehearing and suggestion
for rehearing in bane having been filed by the PETI-
TIONER, and response thereto having been invited
by the court and filed by two RESPONDENTS, and
the petition for rehearing having been referred to the

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109a

panel that heard the appeal, and thereafter the sug-
gestion for rehearing in bane and response having
 been referred to the circuit judges who are in regular
active service,
    UPON CONSIDERATION THEREOF, it is
    ORDERED that the petition for rehearing be, and
the same hereby is, DENIED and it is further
    ORDERED that the suggestion for rehearing in
bane be, and the same hereby is, DECLINED.
    The mandate of the court will issue on November
12,1996.

Dated: November 4,1996
FOR THE COURT,
    MELVIN  L. HALPERN, ACTING CLERK

By /s/ BRIAN  P. LEDUC
BRIAN P. LEDUC
Associate Chief Deputy Clerk

cc: TODD  M. HUGHES
      J. EUCHLER, P. MARTH, H. BEST, J. KOCH
  
MARTHA B. SCHNEIDER

KING V ERICKSON, 95-3745,-3746
(MSPB - DA0752930295R-1)

Note: Pursuant to Fed. Cir. R. 47.6, this order is
not citable as precedent. It is a public record.