UNITED STATES OF AMERICA

MERIT SYSTEMS PROTECTION BOARD

CRAG T. COONS )

)

V. ) DOCKET NUMBER

) SE07528110128

DEPARTMENT OF THE NAVY )

OPINION AND ORDER

Appellant, Crag T. Coons, was removed from his position

as a Digital Computer Systems Administrator, GS-13, with the

Puget Sound Naval Shipyard (agency) based on the charges of

(!) creating an appearance of conflict of interest; and

(2) interfering with the agency investigation concerning

allegations in charge (1). He filed an appeal with the

the Board's Seattle Regional Office. Following a four-day

hearing, the presiding official issued an initial decision

in which he found both charges supported by a preponderance

of the evidence, although the seriousness of charge (1) was

mitigated. However, he reversed the removal action finding

that the agency had committed harmful procedural error under

5 C.F.R. §1201.56 (c)(3) because of the serious lack of

impartiality on the part of the proposing official, Robert

Borquist. The presiding official reached this conclusion

because the deciding official testified that he relied

heavily upon a memorandum prepared by Borquist recommending

removal and that he :*ould have accepted a recommendation by

Borquist of any lesser penalty short of no action at all.

The agency filed a timely petition for review alleging

first, there is new and material evidence now available that,
despite due diligence, was not available prior to the close

of the record and second, that the presiding official misinterpreted appellant's burden of proof as to affirmative

defenses under 5 C.F.R. § 1201.56 (b) (1) and that in lieu of

reversing the action, the Board should examine the record

de novo, applying the standards set forth in Douglas

v« Veterans Administration, 5 MSPB 313 (1981) in selecting

an appropriate penalty.

The agency contends that there exists new and material

evidence consisting of a cost-factor analysis between

several shipyards and an examination of the overhaul of a

single class of submarine, that, despite due diligence, was

not available prior to the close of the record. However,

this evidence was not enclosed with the petition for review.

Further, even assuming the allegations contained in the

petition for review concerning the document to be truef this

evidence merely attempts to impeach the testimony of one

witness, Victor Peters, and relates only to issues collateral

to the appeal. Impeaching evidence does not constitute new

and material evidence. Fleming v. Department of Health

and Human Services, 4 MSPB 277 (1980).

The presiding official did err, however, in reversing

the agency action based on harmful procedural error under

5 C.F.R. § 1201.56 (c) (3) because he found that the deciding

official would have taken an action less severe than removal

had—that---been recommended by Borquist, a person found to be

so biased against appellant that he was incapable of giving

an impartial recommendation.

The Board finds that the bias of the proposing official

in this case is not the kind of factor that should have been

analyzed under the harmful error standard set forth at 5 C.F.R.
§ 1201.56(c)(3) and our decision in Parker v. Defense

Logistics Agency, 1 MSPB 489 (1980) but rather is a factor

that goes towards determining whether the penalty imposed by

the agency was within the parameters of

reasonableness.Douglas, supra*

The deciding official, Commander John Huntley Boyd, Jr.,

testified at the hearing that he woulci have imposed any penalty

short of no penalty at all had it been recommended by Borquist.

[Hearing Transcript [Tr.] at 624, 629/639], Therefore,

although he also testified that he considered various factors

in removing appellant [Tr. 626-28], the Board finds that it

must reanalyze the relevant mitigating factors without the

taint of the proposing official's recommendation having any

weight in our determination*i/

In order to determine what penalty, if any, is

appropriate, the Board will consider the following Douglas

factors: (1) nature and seriousness of the offenses;

As found by the presiding official, the proposing official,

Borquist, was biased against appellant because:

(1) Borquist had opposed appellant's initial

appointment to the position as head of

appellant's division but!had been overruled

by other members of the selection committee;

(2)Borquist and the appellant just didn't like

each other;

/ 1

(3) Borquist was dissatisfied with appellant's

administrative management and personnel

practices. The record shows that 10 months

prior to the notice of proposed removal

Borquist had attempted to have appellant

transferred out of his department;

, (Continued)
(2) employee's job level; (3) past disciplinary record;

(4) past work record; (5) clarity with which appellant was

on notice of any rules that were violated in committing

the offense; and (6) mitigating circumstances surrounding

the offense.

Appellant, employed as a Digital Systems Administrator,

was the division head of the Automated Data Processing (ADP)

Division, and supervised approximately 80 persons. The

agency charged him with, and supported by a preponderance

of the evidence, the following offenses: 1) that he had

created the appearance of a conflict of interest because

of his association with James Blodgett and Blodgett Keypunching, Inc., over a period of time during which Blodgett

Keypunching held a contract with the Shipyard. As a result

of this association, appellant became interested in a

computer package which Blodgett designed to serve pharmacists

and sold to individuals who would operate it on their own.

In the course of exploring the feasibility of this venture,

appellant started to recruit other employees, attended a

meeting-demonstration with two area pharmacists who assumed

(Note 1 continued)

(4) Appellant was uniformly respected for his

competence and upgrading his division while

Borquist was generally considered incompetent

(in fact, the strongest testimony regarding

Borquist's competence was that he was an

"average" supervisor);

(5) As proposing official, Borquist was not merely

a conduit through which appellant passed his

written reply. He wrote, and presented to the

deciding official, a cover memorandum denigrating

the evidence favoring appellant.
him to be a Blodgett employee, and arrangedf paid for and

attended a meeting at the Holiday Inn in which the computer

package was demonstrated; Initial decision at 12; and

2) when the above incident was under investigation by the

agency, appellant told two witneses whom he suspected of

being his accusers that "he would find out who was behind

this and 'sue the bastards1 not caring who won or lost, only

to cost those involved a largo amount of money." Initial:

decision at 16. These individuals interpreted his remarks

as threats and as found by the presiding official, constituted

interference with the investigation.

Although there is some conflict in the record concerning

whether or not appellant was on notice that there were agency

standards of conduct concerning activities that could be considered as a conflict of interest, the presiding official

correctly found that the standards of conduct are largely

a matter of common sense and cover an area for which

employees must be presumed to know the law. Initial decj.^ion

at 14.

Appellant presented the following evidence in support

of mitigation.

Appellant has been employed by the agency for 13 years

beginning as a GS-5 and worked his way up to a GS-13 head

of the ADP division. He had no previous disciplinary record

and several performance appraisals prepared by Borquist show

that his work was considered satisfactory.

In addition, several witnesses testified regarding

respect for appellant's competence and his upgrading of

the ADP unit.I/

j/See Initial decision at 21. The presiding official

found these witnesses, including the former Commander Victor

Peters to be credible. Even Borquist, while denigrating

appellant, recognized appellant's technical ability and

contributions to the ADP unit.
Furtherf the presiding official found that although

the agency had proven the chargesV:b<r.;/a';, preponderance ^of. the

evidence, he found-the following mitigating factors concernif

'' ' ' ..,, ,

 /( • ,;''.. , ;. . . .' ' ' • , ••''••,•' ' '

the conflict of interest charges 1) Borqulst was aware of

''•'. , ' .•'.'•'; . : . • •• • ' / ' • • f , • ' f '

appellant's involvement with Blodgett but said nothing about

-:,, . . '"''•',.' •

 ; . •'•.... . '• • . ' ' / ' ''' //' •

it; 2} appellant's involvement with Blodgett was common

knowledge around the office and appellant made no effort

to conceal his activities? and 3) appellant did not believe

or realize that he was creating a conflict situation at the

time. Initial decision at 14-15.

The charges for which appellant was removed are serious

This Board has sustained removals based on the charge of

creating an appearance of conflict of interest. Se_e_

Wilkes v. Veterans Administration/ 6 MSPB 611 (1981)?

Lavelle v. DeBartmentof the Air Force, MSPB Docket Number

DA075209157 (December 10, 1S81) . Creating the appearance of

a conflict of interes '"••. , I t ' constitute ' • • - s a : seriou . ' s breach of trust.

The Government clearly has an interest in prohibiting such

conduct, and in ensuring that its agents and employees are

not compromised in the; performance of their duties as a

result of any outside influences. See Deal v.

of Justice, MSPB Docket Dumber SL07528QXQ006 (May 10, 1982);

Lavelle, supra. Appellant's actions could place into

question his integrity and the propriety of decisions he

would have to make concerning the ADP unit. Further,

threatening one's subordinate and one's supervisor with

''•.'... ' . •.•-,.. • '

frivolous legal action is conduct that represents poor

judgment, especially from a person who is a supervisor of

approxmately eighty persons.

In light of the mitigating factors in this case,

howeverV the Board cannot find that appellant's removal
is within the parameters of reasonableness. The evidence

of record shows that the bias of Borquist was instrumental

in the agency's decision to remove appellant since the

deciding official repeatedly stated that he would have

taken any penalty recommended by Borquist short of no

penalty at all. Appellant has a long and satisfactory

^performance record and it would hot promote the efficiency

of the service to remove him based on the sustained charges.

Nonetheless, this Board cannot and will not condone

appellant's behavior. Because bf his poor judgment in

matters involving his supervisory and managerial capacity,

some doubt exists as to appellant's ability to satisfactorily

''•i i''''* '-''•'

perform his supervisory and managerial duties. Under these

;

circumstances, a reduction in grade to the next lower nonsupervisory position for which appellant is qualified is

the maximum penalty which the Board could find to be within

the parameters of reasonableness. Davis v. Department of

MSPB Docket Number NY075209075 (October 2,

1981). 'V . • ,|

Accordingly, the findings of fact concerning the two

charges contained in the initial decision are AFFIRMED as

MODIFIED herein and the finding of harmful error is VACATED.

The agency is- hereby ORDERED to cancel the removal of Crag

Coons and substitute in its place a reduction-in-grade to

the next lower nonsupervisory position for which appellant

fsTquaiTf led .' T Proof of compliance with this Order shall be

submitted by the agency to the Office of the Secretary of

the Board within 20 days of the date of issuance of this

opinion. Any petition for enforcement of this Order shall

tie made to the Seattle Regional Office in accordance with

5 C.F.R. § 1201.181 (a) .
8

This is the final Order of the Merit Systems Protection

Board in this appeal. 5 C.F.R. § 1201.113(c).

Appellant is hereby notified of the right to seek

judicial review of the Board's action by filing a petition

i

for review in the United States Court of Appeals for the

Federal Circuit, 717 Madison Place, N. W., Washington,

D. C. 20439. The petition for judicial review must be

filed no later than thirty (30) days after the\ appellant's

receipt of this order.

FOR THE BOARD:

APR 4 1983

(Date)

Wash ington, D. C.

Secretary •'

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