Court Opinion

ID: 2723051
Source: CourtListenerOpinion
Date Created: 2014-09-02 23:12:14.817787+00
Date Added: 2024-06-11T15:40:45.032130
License: Public Domain

UNITED STATES OF AMERICA
                      MERIT SYSTEMS PROTECTION BOARD
                                      2014 MSPB 67

                            Docket Nos. AT-0752-13-0217-I-1
                                        AT-0752-13-0317-I-1
                                        AT-0752-13-0589-I-1

                                    Ricky N. Dawson,
                                        Appellant,
                                             v.
                              Department of Agriculture,
                                         Agency.
                                     August 21, 2014

           Susan G. James, Montgomery, Alabama, for the appellant.

           Jerry D. Dawson, Springfield, Virginia, for the appellant.

           Patsy J. Gallagher, Saint Louis, Missouri, for the agency.

                                         BEFORE

                          Susan Tsui Grundmann, Chairman
                          Anne M. Wagner, Vice Chairman
                             Mark A. Robbins, Member
                  Member Robbins issues a separate, concurring opinion.

                                 OPINION AND ORDER

¶1         Before the Board are three petitions for review of initial decisions
     concerning the appellant’s indefinite suspension, removal, and application for
     early retirement under the Voluntary Early Retirement Authority (VERA). The
     agency has petitioned for review of the two initial decisions that reversed the
     appellant’s indefinite suspension and granted his application for early retirement
                                                                                                2

     and the appellant has petitioned for review of the initial decision that sustained
     his removal.     We JOIN the three appeals under 5 C.F.R. § 1201.36.                 For the
     reasons set forth below, we GRANT the agency’s petitions for review and
     REVERSE the initial decisions insofar as the administrative judge reversed the
     appellant’s indefinite suspension and found that the appellant was entitled to a
     VERA benefit.        We further DENY the appellant’s petition for review and
     AFFIRM the administrative judge’s determination to sustain the removal action.

                                            BACKGROUND
¶2         In   three    separate     appeals,   the   appellant    challenges   the     agency’s
     determinations to indefinitely suspend him from his GS-0301-13 position as an
     Area Director with the agency’s Rural Housing Service in Camden, Alabama,
     effective November 24, 2012; remove him from his position, effective
     January 26, 2013; and deny his application for early retirement under VERA
     pursuant   to      authority   delegated     to   the      agency    by   the     Office   of
     Personnel Management (OPM).
¶3         Before turning to the analysis, a timeline is provided below that sets forth
     the salient facts in this case, which is based on the parties’ stipulations in the
     appeals below.

                                       Chronology of events

                                            November 2012
         November 6, 2012 – Proposed indefinite suspension notice issued.
         November 20, 2012 – The appellant pled guilty to a felony criminal charge
                            of fraud by wire, radio, or television (18 U.S.C. § 1343), due
                            to underlying facts involving his embezzling $6,225,920.76
                            in government funds.
         November 21,         2012     –   Decision   letter    issued   regarding     indefinite
                            suspension.
         November 24, 2012 – Indefinite suspension effected.
                                                                                             3

                               December 2012
• December 5, 2012 – Email memorandum issued announcing the agency’s
                 approval      of     an        early     buyout       under     either     the
                 VERA/Voluntary            Separation          Incentive       Plan   (VSIP).
                 Because the appellant was suspended during the entire
                 month of December 2012, he could not access his agency
                 email account and was unaware of the December 5th
                 memorandum about the VERA/VSIP.
• December 18, 2012 – Proposed removal letter issued.
• December 21, 2012 – End of “window period” for employees to apply for
                 early retirement. The rules allowed that only a single Rural
                 Development district employee would be granted a VERA,
                 based on seniority, as calculated by the employees’ service
                 computation        dates.        Ultimately,      a    coworker      of    the
                 appellant’s, who has a service computation date in 1982, was
                 granted a VERA. The appellant’s service computation date
                 was in 1979.

                                January 2013
• January 24, 2013 – Final removal decision letter issued based on the
                 appellant’s    plea       of    guilty   to    knowingly        devising   or
                 participating in a scheme to defraud and/or obtaining money
                 or property by means of false or fraudulent pretenses,
                 representations, or promises.
• January 26, 2013 – Effective date of the appellant’s removal.
• January 31, 2013 – Coworker retired early and obtained a VERA.

                                    March 2013
• March 8, 2013 – The appellant applied for early retirement, requesting
                 a VERA.
                                                                                       4

        • March 12, 2013 – The appellant was sentenced to 60 months in jail for
                          criminal conviction. He was ordered to report to prison on
                          May 31, 2013.
        • Date uncertain – The agency subsequently denied the appellant’s
                          VERA request.
     See Dawson v. Department of Agriculture, MSPB Docket No. AT-0752-13-0317-
     I-1 (May 16, 2013) Appeal File (AF) 0317, Tabs 5, 10.
¶4         After adjudicating the appeals, the administrative judge issued three initial
     decisions.   In the first initial decision, the administrative judge reversed the
     indefinite suspension for two reasons:    (1) the agency violated the appellant’s
     constitutional right to due process; and (2) the suspension improperly occurred
     simultaneously with the notice of proposed removal period based on the same
     charged misconduct. Dawson v. Department of Agriculture, MSPB Docket No.
     AT-0752-13-0217-I-1, Initial Decision (Mar. 16, 2013) (ID 0217). In a second
     initial decision, the administrative judge sustained the removal action. Dawson v.
     Department of Agriculture, MSPB Docket No. AT-0752-13-0317-I-1, Initial
     Decision, (May 16, 2013) (ID 0317). A third initial decision ordered the agency
     to grant the appellant’s application for early retirement under VERA. Dawson v.
     Department of Agriculture, MSPB Docket No. AT-0752-13-0589-I-1, Initial
     Decision, (Sept. 12, 2013) (ID 0589).     The agency filed petitions for review
     challenging the administrative judge’s determinations in the first and third initial
     decisions. The appellant filed a petition for review contesting the administrative
     judge’s second initial decision.

                                        ANALYSIS
     The administrative judge correctly sustained the removal of the appellant and
     properly determined that the appellant did not prove his harmful error allegation.
¶5         As a preliminary matter, we find that the administrative judge correctly
     affirmed the agency’s decision to remove the appellant based on his guilty plea to
     knowingly devising or participating in a scheme to defraud and/or obtain money
                                                                                    5

     or property by means of false or fraudulent pretenses, representations, or
     promises.   The parties stipulated that the appellant pled guilty to a charge of
     fraud by wire, radio, or television in federal court on November 20, 2012, and
     that he was sentenced to 60 months’ imprisonment, beginning on May 31, 2013.
     Such criminal misconduct is a felony punishable by a fine or imprisonment for up
     to 20 years, or both. See 18 U.S.C. § 1343. As a result, the administrative judge
     correctly determined that the agency proved the charge, nexus, and that the
     penalty of removal was warranted. ID 0317 at 2-4. The administrative judge also
     properly found that the appellant failed to prove his harmful error claims. See
     ID 0317 at 4-6.
     The administrative judge incorrectly reversed the indefinite suspension on the
     ground that the agency improperly imposed the suspension during some of the
     same time that coincided with the proposed removal period.
¶6         Next, the administrative judge found that, because the agency imposed an
     emergency or indefinite suspension that coincided with a notice period for a
     removal action, the indefinite suspension should be deemed improper.         We
     disagree.   It is true that, at times, the Board has held that, where an agency
     imposes a disciplinary or an adverse action because of an employee’s misconduct,
     the agency is barred from subsequently taking another adverse action for the same
     reason. ID 0217 at 6-7 (and cases cited therein). However, the precedent relied
     upon by the administrative judge in the initial decision has not been universally
     applied by the Board or even by our reviewing court. See Graybill v. U.S. Postal
     Service, 782 F.2d 1567, 1573 n.1 (Fed. Cir. 1986) (the court held that the
     agency’s imposition of both a suspension and a removal penalty for the
     appellant’s arrest on charges of sexual misconduct involving a minor and his
     subsequent guilty plea did not constitute an abuse of discretion); Camaj v.
     Department of Homeland Security, 119 M.S.P.R. 95 (2012) (the agency
     indefinitely suspended the appellant based on criminal charges and then removed
     him on charges of conduct unbecoming a law enforcement officer and misuse of
                                                                                        6

     an official government database); Jones v. Department of the Army, 68 M.S.P.R.
     398, 402 (1995) (the appellant was to be indefinitely suspended through the end
     of the criminal proceedings and “through any proposal period for any additional
     action” to be taken against the appellant).        Relying on the case law cited
     immediately above, we find that the administrative judge’s reason for reversing
     the indefinite suspension was erroneous.
¶7           In any event, we find that the appellant is not entitled to back pay for the
     more than 3 weeks of the indefinite suspension period (November 24—
     December 18, 2012), that transpired before the agency issued the notice of
     proposed removal because no overlap occurred with the two disciplinary actions
     during those 3 weeks.
     The administrative judge erroneously determined that the agency did not provide
     the appellant with sufficient notice of the reasons for the indefinite suspension.
¶8           Also, in reversing the indefinite suspension, the administrative judge found
     that the agency violated the appellant’s constitutional right to minimum due
     process of law by failing to specifically notify him in the proposal notice or
     decision letter that the agency had reasonable cause to believe he had committed
     a crime for which a sentence of imprisonment could be imposed.                   The
     administrative judge determined that this omission necessarily prevented the
     appellant from knowing what standard the agency would use to decide his
     indefinite suspension and thus, how he must respond to the proposal. ID 0217
     at 6.
¶9           We disagree with the administrative judge’s conclusion that a due process
     violation    occurred    here.      In   Cleveland    Board     of   Education    v.
     Loudermill, 470 U.S. 532, 546 (1985), the Supreme Court concluded that due
     process requirements entail:      (1) written notice of the charges against the
     employee, with an explanation of the evidence; and (2) an opportunity for the
     employee to present his account of events. Both of these factors were present in
     the instant case, as more fully discussed below.
                                                                                       7

¶10         For the Board to sustain the indefinite suspension under the circumstances
      of this case, the agency must establish by a preponderance of the evidence that it
      had reasonable cause to believe the appellant committed a crime for which a
      sentence of imprisonment may be imposed.            See 5 C.F.R. § 1201.56(a)(ii);
      Pararas-Carayannis v. Department of Commerce, 9 F.3d 955, 957 (Fed. Cir.
      1993); Rittgers v. Department of the Army, 117 M.S.P.R. 182, ¶ 12 (2011). The
      critical factor in ascertaining if the agency had reasonable cause to believe that
      the appellant committed a crime that could result in imprisonment is the record
      that the officials had before them when they effected the action. See Barresi v.
      U.S. Postal Service, 65 M.S.P.R. 656, 665 (1994).
¶11         In this case, the agency’s proposal letter specifically referenced a criminal
      investigation, the potential for a penalty of imprisonment, and the appellant’s
      purported confession to the misconduct at issue. AF 0217, Tab 6; ID 0217 at 3.
      The agency afforded the appellant the requisite substantive proposal letter, which
      annotated the basis for the indefinite suspension and the evidence gathered at that
      point and provided him a reasonable opportunity to reply in accordance with the
      provisions set forth in Cleveland.    Furthermore, the appellant was reasonably
      aware of the grounds by which his indefinite suspension would be decided. The
      November 6, 2012 notice letter described “such cause” as set forth in 5 U.S.C.
      § 7513 and advised the appellant of the following:      (a) the type of action the
      agency planned to take (an indefinite suspension); (b) the expected duration,
      pending: (1) completion of investigations for which a penalty of imprisonment
      could be imposed; and (2) a reasonable time thereafter while the agency decided
      the appropriate administrative action, to include possible removal from federal
      service; and (c) the reasons for the indefinite suspension.      AF 0217, Tab 4,
      Subtab 4f.   In fact, the proposal letter explained the reason for the proposed
      action was that:
           On June 20, 2012, Special Agent Philip Maxey, Office of Inspector
           General (OIG), notified [the proposing official] that: 1) you were
                                                                                                 8

               under investigation for alleged embezzlement of government funds;
               and 2) a criminal investigation was underway and would likely result
               in criminal conviction. On August 16, 2012, Special Agent Maxey
               informed [the proposing official] that the Federal Bureau of
               Investigation (FBI) was also involved. Moreover, on October 5,
               2012, Special Agent Maxey informed [the proposing official] that you
               had confessed to the misconduct under investigation and additional
               misconduct relating to other accounts.
      Id.
¶12            Thus, the agency informed the appellant that:               (1) information was
      provided to the agency in an ongoing criminal investigation; (2) the investigation
      concerned      the    appellant’s   alleged   embezzlement     of    government       funds;
      (3) a criminal investigation would likely result in criminal conviction; (4) the FBI
      was involved in the investigation; (5) the appellant confessed to the misconduct
      under investigation and additional misconduct relating to other accounts; and, as
      set forth below (6) the information obtained during an independent agency
      inquiry reflected the appellant’s mishandling of customer payments he received in
      connection with his grant loan servicing responsibilities.           See id.      The notice
      letter    further    provided   great   detail   in   describing    significant    financial
      discrepancies regarding rural water and utilities accounts over which the
      appellant had responsibility and from which he embezzled substantial government
      funds. See id. In particular, the proposal letter noted that:
            • The appellant received checks for $999,000 and $957,559.29 from the City
               of Thomasville and $799,172.79 from the West Dallas Water Authority
               payable to “Rural Development”; 1 however, the payee on these checks
               reflected “Ryal Development” when the checks cleared the bank.
            • The appellant endorsed a $400,000 check received from Southern Pine
               Electric in unused funds as “For Deposit Only.” His endorsement violated

      1
        Rural Development is the agency’s department that comprises the Rural Housing
      Service for which the appellant worked.
                                                                                   9

   [Rural     Development]       Instruction 1951-B,          Section 1951.54(b)(3).
   Representatives of Southern Pine Electric and Freemanville Water System
   stated they provided the appellant with checks for $400,000, $90,000, and
   $70,000, respectively. However, there was no evidence in the agency’s
   loan files or computer systems to indicate receipt.
• On May 9, 2012, the appellant presented the Chairman of the West Dallas
   Water Authority with a $799,172.79 cashier’s check issued by First
   Community Bank on behalf of Rural Development.                   The check was
   compensation for funds he previously released prematurely to West Dallas
   Water Authority and which West Dallas Water Authority had returned to
   Rural Development.     Rural Development does not have an account with
   First Community Bank.
• On January 11, 2010, the appellant attended Freemanville Water System’s
   board meeting and offered a 20 percent early payoff arrangement for its
   loan. On April 20, 2010, the appellant also signed a letter outlining the
   early payoff terms in the amount of $160,000. Staff Instruction 1782-1,
   Section 1782.20-(a)(8) dictates that the State Director must approve
   such arrangements.
• On February 14, 2011, the appellant hand-delivered a cashier’s check in the
   amount of $13,341 issued by First Community Bank to Freemanville Water
   System. He provided the check to compensate for an erroneous deduction
   of a monthly loan payment due to failure to cancel its pre-authorization
   debit as of February 27, 2010, its alleged loan pay-off date.          As stated
   above,   Rural   Development    does not   have       an    account   with   First
   Community Bank.
• On April 27, 2011, the appellant hand-delivered a cashier’s check issued by
   First Community Bank in the amount of $308,952.06 payable to “USDA”
   to the Rural Development’s Area Technician. He provided the cashier’s
   check as full payment of the Freemanville Water System loan, even though
                                                                                       10

            the customer had given him a check on September 27, 2010, issued by
            United Bank (not First Community Bank), to pay the loan in full.
      See ID 0217, Tab 4, Subtab 4f.
¶13         Based on the information contained in the notice of proposed indefinite
      suspension, we conclude that the agency provided the appellant prior notice of
      the specific reason for the indefinite suspension (i.e., reasonable cause to believe
      that he committed a criminal offense for which a term of imprisonment could be
      imposed).   See Graybill, 782 F.2d at 1573 n.1; Hayes v. Department of the
      Navy, 727 F.2d 1535, 1538 (Fed. Cir. 1984) (the court found that the proposal
      letter provided the appellant with sufficient due process where he had ample
      notice of the charge and an opportunity to respond thereto both at the agency and
      the Board levels, he admitted to the conviction at the Board hearing, and he never
      alleged that he did not know what the charge and specification covered);
      Hernandez v. Department of the Navy, 120 M.S.P.R. 14, 18-21 (2013) (the agency
      had reasonable cause to believe that the employee had committed a crime for
      which a term of imprisonment could be imposed, as required to support indefinite
      suspension; the employee had been arrested, arraigned, and formally charged with
      six misdemeanor counts, including battery and unlawful carrying of a weapon,
      each of which could have resulted in a penalty of at least 6 months’
      imprisonment); Dalton v. Department of Justice, 66 M.S.P.R. 429, 435 (1995)
      (the standard for imposing an indefinite suspension is not whether the agency
      could prevail on the criminal charge but, rather, whether it had reasonable cause
      to believe that the appellant had committed a crime punishable by a term of
      imprisonment at the time it imposed the suspension); see also Crofoot v.
      Government Printing Office, 823 F.2d 495, 498 (Fed. Cir. 1987) (an agency may
      appropriately consider    a guilty plea     in its determination to discipline
      an employee). Therefore, we find that the agency provided the appellant with his
      constitutional right to minimum due process of law. See Pararas-Carayannis,
                                                                                    11

      9 F.3d at 958; Dunnington v. Department of Justice, 956 F.2d 1151, 1157 (Fed.
      Cir. 1992).
¶14         As an aside, given that the appellant admitted to the crime on
      November 20, 2012, or 4 days before the indefinite suspension began, the
      administrative judge’s reliance on Gonzalez v. Department of Homeland
      Security, 114 M.S.P.R. 318 (2010), is misplaced.      See ID 0217 at 4-5.      In
      Gonzalez, the investigation into the appellant’s misconduct that triggered the
      indefinite suspension was still ongoing and the agency was waiting for a possible
      indictment. Here, in contrast, the investigation was cut short by the appellant’s
      guilty plea, obviating the need to complete the investigation and to await a
      criminal indictment. Based on the foregoing, we conclude that the administrative
      judge erred in reversing the indefinite suspension. Accordingly, we SUSTAIN
      the indefinite suspension.
      The appellant failed to demonstrate good cause for his untimely filed application
      to retire with a Voluntary Early Retirement Authority benefit.
¶15         Finally, we disagree with the administrative judge’s determination that the
      appellant demonstrated good cause for his untimely filed application to retire
      with a VERA benefit. There is no dispute that, because the appellant was serving
      an indefinite suspension, he lacked the only means to receive the agency’s
      December 2012 VERA/VSIP notification during the “window” period, i.e.,
      agency email. ID 0589 at 8. The administrative judge determined that, but for
      the indefinite suspension, the appellant would have received the December 2012
      VERA/VSIP notification in the normal manner.          ID 0589 at 8 n.9.      The
      administrative judge further determined that, because the agency did not provide
      the appellant with a copy of the notification during the window period for
      submitting applications or at any time prior to his removal, the appellant was
      effectively denied the opportunity to timely apply for the December 2012
      VERA/VSIP. The administrative judge concluded that, although the appellant’s
      March 8, 2013 application for early retirement was untimely filed (i.e., filed
                                                                                        12

      outside the window period), good cause existed for its untimeliness.        ID 0589
      at 5. For the reasons set forth below, we disagree.
¶16           At the outset, we note that the administrative judge correctly determined
      that the Board has jurisdiction over this matter. ID 0589 at 3-4. According to the
      Standard Form 50 effectuating the appellant’s removal, he was covered under the
      Civil Service Retirement System (CSRS). AF 0589, Tab 3, Subtab 4b, Box 30.
      The Board has jurisdiction over an appeal from “an administrative action or order
      affecting the rights or interests of an individual” under the CSRS.         5 U.S.C.
      § 8347(d). Ordinarily, such an appeal is from an OPM decision. Mandarino v.
      Department of Homeland Security, 118 M.S.P.R. 510, ¶ 7 (2012). Here, however,
      the agency approved or denied early retirement applications from Rural
      Development employees pursuant to an express delegation of authority from
      OPM, and the appellant challenges the agency’s failure to grant his application
      pursuant to that authority. AF 0589, Tabs 1, 6, 10; see 5 C.F.R. § 831.114. Our
      reviewing court has held that an appeal from an adverse VERA determination
      under    such circumstances    falls within the       Board’s   jurisdiction as   “an
      administrative action or order” under 5 U.S.C. § 8347(d). Adams v. Department
      of Defense, 688 F.3d 1330, 1335-36 (Fed. Cir. 2012).
¶17           The agency confirmed below that it did not issue a written response to the
      appellant’s application. AF 0589, Tab 8 at 2. We conclude that the appellant was
      not required to wait for the agency’s written decision before filing his appeal.
      The Board has held under analogous circumstances that, where OPM has
      delegated to an agency the authority to make an enhanced retirement coverage
      determination, and the agency has not issued a final decision on a claim for
      retirement benefits and does not intend to do so, the Board will deem the agency
      to have denied the appellant’s request and take jurisdiction under 5 U.S.C.
      § 8347(d)(1). Mandarino, 118 M.S.P.R. 510, ¶¶ 9-11 (concerning an appellant’s
      request for enhanced retirement benefits available to law enforcement officers).
      Similarly here, OPM has delegated to the agency the authority to make an
                                                                                           13

      enhanced retirement coverage determination and the agency has not issued a final
      decision on the appellant’s claim for benefits. Further, there is no indication that
      the agency intends to do so. We are not persuaded by the agency’s attempt to
      distinguish Mandarino on the ground that the appellant in that case requested
      reconsideration from the agency, whereas the appellant in this case has not.
      Petition for Review File 0589, Tab 1 at 2. First, as stated above, the agency has
      not issued any determination concerning the appellant’s request from which he
      could seek reconsideration.         Second, because the agency has made no
      determination, it has not advised the appellant of any right or obligation on his
      part to seek reconsideration. 2 Under the circumstances of this case, we deem the
      agency to have denied the appellant’s request for application to retire with a
      VERA benefit and take jurisdiction under 5 U.S.C. § 8347(d).               See Adams,
      688 F.3d at 1335-36.
¶18         We next turn to the administrative judge’s determination that the agency’s
      failure to provide the appellant with a copy of the December 5, 2012 VERA/VSIP
      notification during the window period excused his untimely filing of his
      application for early retirement. ID 0589 at 5. Here, OPM’s regulations provide
      that an agency may limit voluntary early retirement offers, inter alia, based on
      “[a]n established opening and closing date for the acceptance of applications that
      is announced to employees at the time of the offer.” 5 C.F.R. § 831.114(h)(1).
      Subject to exceptions not applicable here, an agency may not offer or process

      2
        Although the court in Adams did not decide whether an appellant is first required to
      seek reconsideration of an adverse VERA determination from OPM prior to filing a
      Board appeal, see 688 F.3d at 1335-36, we agree with the administrative judge that the
      appellant was not required to do so, ID 0589 at 3-5. See, e.g., Melvin v. Office of
      Personnel Management, MSPB Docket No. SF-0831-98-0378-I-1, 1998 WL 1981575
      (Initial Decision, July 10, 1998) (stating that OPM had refused to issue a
      reconsideration decision concerning the determination of the appellant’s employing
      agency that he was not entitled to a VSIP, on the ground that it lacked the authority to
      issue such a decision).
                                                                                               14

      voluntary     early    retirements    beyond   the   stated   expiration     date   of    a
      VERA.       5 C.F.R. § 831.114(m).       As stated above, the appellant submitted a
      VERA application on March 8, 2013, after the agency’s window period for filing
      applications had closed on December 21, 2012. AF 0589, Tab 1 at 12. Thus, the
      appellant’s application was untimely.
¶19         The Board has recognized that an agency’s misconduct may preclude
      enforcement of a filing deadline under the doctrine of equitable estoppel, at least
      where such estoppel would not result in the expenditure of appropriated funds in
      contravention     of     statute.        See   Nunes    v.    Office    of     Personnel
      Management, 111 M.S.P.R. 221, ¶ 16 (2009). We find no misconduct on the part
      of the agency in this case that would warrant application of this doctrine. The
      administrative judge appears to have concluded that the agency effectively and
      unfairly denied the appellant the opportunity to timely apply for early retirement
      by indefinitely suspending him, thereby barring his access to his email, and by
      failing to send him the December 2012 VERA/VSIP notification during that
      period.     ID 0589 at 5, 8.        As stated above, however, we conclude that the
      administrative judge erred in reversing the indefinite suspension and that the
      imposition of the suspension was proper.             Because the imposition of the
      indefinite suspension, and the appellant’s consequent lack of access to his email,
      are not attributable to any agency misconduct, these circumstances do not provide
      a basis for waiving the filing deadline on equitable grounds. 3

      3
        The Board has recognized that an agency’s failure to provide a notice of rights and the
      applicable filing deadline may warrant waiver of the deadline if a statute or regulation
      requires that such notice be given, see Nunes, 111 M.S.P.R. 221, ¶ 16. We find,
      however, that the agency’s email announcement was reasonably calculated to provide
      its employees with notice of the December 2012 VERA/VSIP opportunity, and therefore
      satisfied its obligation under 5 C.F.R. § 831.114(h)(1) to announce to employees at the
      time of the offer the established opening and closing dates for the acceptance of
      applications.
                                                                                      15

¶20         We further find that the application of equitable principles here, notably,
      the doctrine of unclean hands, heavily weighs against waiving the filing deadline
      in this case. Cf. Walls v. Merit Systems Protection Board, 29 F.3d 1578, 1582
      (Fed. Cir. 1994) (“‘broad equitable principles of justice and good conscience’
      should be applied in good cause determinations”) (quoting Alonzo v. Department
      of the Air Force, 4 M.S.P.R. 180, 184 (1980)). The doctrine of unclean hands “is
      a self-imposed ordinance that closes the doors of a court of equity to one tainted
      with inequitableness or bad faith relative to the matter in which he seeks relief,
      however improper may have been the behavior of the defendant.”            Princess
      Cruises, Inc. v. United States, 397 F.3d 1358, 1369 (Fed. Cir. 2005) (quoting
      Precision Instrument Manufacturing Co. v. Automotive Maintenance Machinery
      Co., 324 U.S. 806, 814 (1945)) (an equity court has a wide range when exercising
      discretion to refuse to aid an unclean litigant; a court is not bound by formula or
      restrained by any limitation that tends to trammel the free and just exercise of
      discretion); Special Counsel v. Filiberti, 27 M.S.P.R. 37, 39 (the unclean hands
      doctrine holds that “the person who seeks equity must do equity”), modified on
      other grounds, 27 M.S.P.R. 577 (1985).
¶21         The Board has invoked the doctrine of unclean hands rarely, most notably
      in the context of a petition to enforce a settlement agreement. For example, in
      Wofford v. Department of Justice, 115 M.S.P.R. 367, 373 (2010), the Board
      denied the appellant’s petition because the Board determined that she herself
      breached the agreement before she became aware of the agency’s breach, and her
      actions of filing claims against the agency with the Equal Employment
      Opportunity Commission and in U.S. District Court were clearly a material
      breach. The Board further stated that “the appellant’s actions were ‘tainted with
      inequitableness or bad faith relative to the matter in which she seeks relief,
      however improper may have been the behavior of the agency.’”          Id. (quoting
      Precision Instrument Manufacturing, Inc., 324 U.S. at 814); see also Alderete v.
      Department of the Interior, 100 M.S.P.R. 16 (2005) (McPhie, Chairman, separate
                                                                                       16

      opinion, ¶ 13) (the employee’s involuntary retirement appeal should be dismissed
      because she came to the Board with unclean hands).
¶22         It is appropriate to invoke the doctrine of unclean hands when there is an
      element of bad faith shown on the part of one or more of the litigants.         See
      Precision Instrument Manufacturing, Inc., 324 U.S. at 814. It is clear from the
      facts of this case that it was the appellant’s misconduct, rather than any
      misconduct on the part of the agency, that precluded him from accessing the
      agency’s notice. That is, the appellant engaged in a lengthy pattern of bad faith
      and deceitful behavior when he embezzled government funds over which he had
      control. See Promac, Inc. v. West, 203 F.3d 786, 788-89 (Fed. Cir. 2000) (the
      lowest bidder for a government construction project was not entitled to
      reformation of that contract based on the government’s alleged violations of
      regulations during the bidding process, given that the bidder benefitted from and
      actively participated with the government in the challenged procurement process
      and thus had unclean hands and was not entitled to equitable relief); Richards v.
      General Motors Corp., 876 F. Supp. 1492, 1511 (E.D. Mich. 1995) (an employee
      who back-dated asset transfer forms in an attempt to secure retroactive gains in
      his employer’s stock purchase plan had unclean hands and was therefore
      precluded from asserting a claim against his employer under the Employees
      Retirement Income Security Act; the employee knew or should have known that
      back-dating   the   forms    violated   stock   purchase   plan   rules   and   was
      “simply wrong”).    Accordingly, application of equitable principles here weigh
      against waiving the filing deadline in this case.
¶23         Because we conclude that the appellant’s untimely filing was not excused
      and that principles of equity preclude waiver of the filing deadline in this case,
      we REVERSE the administrative judge’s initial decision in MSPB Docket No.
      AT-0752-13-0589-I-1 ordering the agency to grant the appellant’s application for
      early retirement benefits.
                                                                                       17

                                             ORDER
¶24         This is the final decision of the Merit Systems Protection Board in these
      appeals.     Title 5 of the Code of Federal Regulations, section 1201.113(c)
      (5 C.F.R. § 1201.113(c)).

                        NOTICE TO THE APPELLANT REGARDING
                           YOUR FURTHER REVIEW RIGHTS
            You have the right to request review of this final decision by the
      United States Court of Appeals for the Federal Circuit. 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 60 calendar days
      after the date of this order. See 5 U.S.C. § 7703(b)(1)(A) (as rev. eff. Dec. 27,
      2012). If you choose to file, be very careful to file on time. The court has held
      that normally it does not have the authority to waive this statutory deadline and
      that filings that do not comply with the deadline must be dismissed. See Pinat v.
      Office of Personnel Management, 931 F.2d 1544 (Fed. Cir. 1991).
            If you need further information about your right to appeal this decision to
      court, you should refer to the federal law that gives you this right. It is found in
      Title 5 of the United States Code, section 7703 (5 U.S.C. § 7703) (as rev. eff.
      Dec. 27, 2012).    You may read this law as well as other sections of the
      United States Code, at our website, http://www.mspb.gov/appeals/uscode/htm.
      Additional information is available at the court's website, www.cafc.uscourts.gov.
      Of particular relevance is the court's "Guide for Pro Se Petitioners and
      Appellants," which is contained within the court's Rules of Practice, and Forms 5,
      6, and 11.
                                                                           18

      If you are interested in securing pro bono representation for your court
appeal, you may visit our website at http://www.mspb.gov/probono for a list of
attorneys who have expressed interest in providing pro bono representation for
Merit Systems Protection Board appellants before the court. The Merit Systems
Protection Board neither endorses the services provided by any attorney nor
warrants that any attorney will accept representation in a given case.

FOR THE BOARD:

______________________________
William D. Spencer
Clerk of the Board
Washington, D.C.
               CONCURRING OPINION OF MEMBER MARK A. ROBBINS

                                                in

                           Ricky N. Dawson v. Department of Agriculture

                             MSPB Docket No. AT-0752-13-0217-I-1

¶1         I concur fully with the disposition of this case. I write separately on the
     issue of the appellant’s attempt to claim an entitlement to a $25,000 Voluntary
     Early Retirement Authority (VERA)/Voluntary Separation Incentive Plan (VSIP)
     incentive to note the absurdity of his claim in light of equity, as discussed in the
     Opinion and Order, and applicable law and public policy interests that underlie
     this authority.
¶2         As for legal considerations, I cannot agree with the administrative judge
     that the appellant qualified for the VERA incentive under the law. According to
     the Standard Form 50 effectuating the appellant’s removal, he was covered under
     the Civil Service Retirement System.            Appeal File (AF), Tab 3, Subtab 4b,
     Box 30.   Thus, the administrative judge’s reliance on statutory and regulatory
     provisions for employees covered by the Federal Employees’ Retirement System
     was inapposite. Under 5 U.S.C. § 8336(d)(2)(C), an employee is entitled to an
     immediate annuity, so long as he “has not been duly notified that [he] is to be
     involuntarily separated for misconduct or unacceptable performance.” Likewise,
     under 5 U.S.C. § 3521(2)(iii), an employee is not eligible for a VSIP if he is “in
     receipt   of      a   notice   of   involuntary    separation   for   misconduct   or
     unacceptable performance.”
¶3         Here, the proposed removal letter “duly notified” the appellant that he was
     going to be fired. The letter was issued on December 18, 2012, or 3 days before
     December 21, 2012, the end date for the “open window” period for the
     submission of early retirement applications. Based on the undisputed facts, when
     the appellant applied to retire, he had already received a notice of removal letter.
     I believe that the law dictates that the appellant was rendered ineligible to apply
                                                                                            2

     for the VERA incentive on that basis.                 I therefore would find, as did the
     administrative judge, MSPB Docket No., AT-0752-13-0589-I-1, Initial Decision
     at 7-9 (Sept. 12, 2013), that the agency did not commit harmful error by failing to
     notify the appellant of the VERA/VSIP “open window” period, given his receipt
     of the notice of proposed removal prior to the end of the “open window” period,
     see Hickman v. U.S. Postal Service, 991 F.2d 810 (Fed. Cir. 1993) (Table)
     (finding that the appellant, a Postal supervisor criminally convicted of falsifying
     stamp destruction certificates, was not entitled to retire with an early retirement
     incentive because she received the early retirement incentive package after her
     removal became effective; therefore, this retirement option was never available to
     her).
¶4            As for public policy considerations, Title 5 and Office of Personnel
     Management (OPM) regulations give an agency the ability to request VERA
     authority when the agency believes it would serve its need to reduce personnel
     levels due to substantial workforce restructuring or reshaping initiatives. These
     include, but are not limited to, delayering, reorganization, reductions in force, or
     transfers of function. 1 See 5 U.S.C. § 8414(b)(1)(B); 5 C.F.R. § 842.213(c); see,
     e.g., Perrine v. General Services Administration, 81 M.S.P.R. 155, 160-63
     (1999). Stated differently, an agency generally grants VERA incentives for the
     mutual benefit of the agency and the employee. Indeed, that is what happened
     here.     The agency in its December 2012 VERA/VSIP notice stated that it had
     asked OPM to approve its request to offer VERA incentives to employees due to
     budgetary reductions and a need to re-examine priorities.                    AF, Tab 4
     (attachment).       I believe that, while this appellant would certainly benefit by
     receiving $25,000, there would be no benefit to the government to grant a VERA
     to an employee who left the workforce due to his impending incarceration.

     1
         See htt p:// www.op m. go v/e mpl oy/ htm l/v si.ht m.
                                                                                             3

¶5           Recalling the facts of this case, on November 20, 2012, the appellant pled
     guilty to a felony criminal charge of fraud by wire, radio, or television (18 U.S.C.
     § 1343), due to underlying facts involving his embezzling $6,225,920.76 of
     government funds.      Effective January 26, 2013, he was removed from his
     position. He applied for early retirement under the VERA authority on March 8,
     2013, 4 days before he was criminally convicted and sentenced to 60 months in
     jail.
¶6           Clearly the appellant’s primary motive in retiring at that point was to allow
     him or his dependents the opportunity to continue receiving regular income in the
     form of an immediate annuity. The VERA incentive had little, if anything, to do
     with his motive for retiring, especially given that he might have qualified for
     immediate retirement based on his more than 33 years of service. 2 AF, Tab 1;
     Tab 3, Subtab 4b.     It would be a travesty of justice for the appellant to get
     $25,000 after he admitted to embezzling millions of dollars of government funds.
¶7           Occasionally, there are calls from Congress or the public to revoke certain
     federal employment benefits upon the commission of a crime.                And at times
     federal benefits may be revoked or limited after a criminal conviction.               See
     Federal    Statutes    Imposing     Collateral    Consequences      Upon     Conviction
     (Department of Justice), available at http://www.justice.gov/pardon/collateral
     _consequences.pdf; Internal Exile: Collateral Consequences of Convictions in
     Federal Laws and Regulations (the American Bar Association and the Public
     Defender Service for the District of Columbia) at 38-41 (2009), available
     at http://www.pdsdc.org/Resources/Publication/Collateral%20Consequences%20o

     2
       The box containing the date of birth on the Standard Form 50 effectuating the
     appellant’s removal is redacted, so his actual age is not in evidence. AF, Tab 3,
     Subtab 4b, Box 3. But newspaper articles cited by the agency in the removal letter state
     that the appellant was 54 years old at the time he entered a guilty plea. If that is true,
     then it is not clear, when he applied to retire 4 months later, if he met the age
     requirement of 55 years for immediate retirement under the Civil Service Retirement
     System. See 5 U.S.C. § 8336(a).
                                                                                 4

20
Conviction%20in%20Federal%20Laws%20and%20Regulations.pdf.                Some    of
these include:
      • An individual convicted of certain offenses related to national security
         may be prevented, as would be his survivor and his beneficiary, from
         obtaining an annuity or retirement pay from the United States or District
         of Columbia governments, and may be subject to additional penalties
         concerning his collection of old-age, survivors, or disability insurance
         benefits, or health insurance for the aged and disabled. See 5 U.S.C.
         § 8312; 42 U.S.C. § 402(u)(1).
      • An individual who is confined for over 30 days in a jail or penal
         institution upon conviction of a criminal offense may not receive old-
         age, survivors, or disability insurance payments for any month in which
         he was incarcerated. See 42 U.S.C. § 402(x)(1)(A)(i).
      • An individual convicted of fraud in applying for or receiving federal
         workers’ compensation benefits may not receive those benefits for any
         injury occurring on or before the conviction. See 5 U.S.C. § 8148(a).
      • Federal workers’ compensation benefits may not be paid to the offender
         (but may be paid to dependents) during a period of incarceration
         resulting from a felony conviction of a federal employee. See 5 U.S.C.
         §§ 8148(b)(1), (3).
      • Certain convicted drug offenders may be made ineligible for grants,
         licenses, contracts, and other federal benefits, such as Pell grants,
         federal Stafford Loans, federal PLUS Loans, and federal work study.
         See 20 U.S.C. § 1091(r), 21 U.S.C. § 862.     In addition, they may be
         denied food stamps or temporary assistance to needy families.
      • Individuals   convicted   of   illegally   manufacturing   or    producing
         methamphetamine on the site of federally-assisted housing may be
                                                                                         5

              evicted and permanently barred from occupying such housing and from
              receiving federal low-income housing assistance.             See 42 U.S.C.
              § 1437n(f).
           • Individuals convicted of serious sex offenses also may be ineligible for
              federally-assisted housing. See 42 U.S.C. § 13663.
           • An individual found guilty of mutiny, treason, sabotage, or rendering
              assistance to an enemy of the United States, as well as other enumerated
              federal crimes, forfeits his rights to all veterans’ benefits, including
              pension, disability, hospitalization, loan guarantees, and burial in a
              national cemetery. See 38 U.S.C. § 6104 and 38 U.S.C. § 6105.
¶8        I believe that in this particular case the law is clear that the appellant is not
     entitled to a VERA retirement payment.       In light of the above examples (and
     there are many others) of statutory provisions to restrict criminals from receiving
     federally supported benefits, I believe that the appellant’s conviction of
     embezzling millions of taxpayer dollars, most of which money will never be
     recovered, should, as a matter of law and public policy, also prevent him from
     enjoying any potential right to a federal benefit in which he is not legally vested,
     regardless of whether he might otherwise be qualified.

     ______________________________
     Mark A. Robbins
     Member