Court Opinion

ID: 9372797
Source: CourtListenerOpinion
Date Created: 2023-02-22 16:00:42.516136+00
Date Added: 2024-06-11T17:16:47.367082
License: Public Domain

UNITED STATES OF AMERICA
                       MERIT SYSTEMS PROTECTION BOARD
                                       2022 MSPB 2
                             Docket No. CB-1216-16-0018-T-1

                                     Special Counsel,
                                        Petitioner,
                                             v.
                                     Rodney Cowan,
                                       Respondent.
                                      March 29, 2022

           Erica S. Hamrick, Esquire, Washington, D.C., for the petitioner.

           Bryan Delius, Esquire, Sevierville, Tennessee, for the respondent.

                                         BEFORE

                              Raymond A. Limon, Vice Chair
                               Tristian L. Leavitt, Member

                                 OPINION AND ORDER

¶1        This case is before the Board on interlocutory appeal from the
     administrative law judge’s order staying the proceedings and certifying his ruling
     that the parties’ Modified Settlement Agreement cannot be approved because it is
     inconsistent with Board precedent and prohibitions in the Hatch Act set forth at
     5 U.S.C. § 7323(a). For the following reasons, we REVERSE the administrative
     law judge’s ruling, GRANT the parties’ joint motion to approve the agreement,
     FIND, based on stipulations in the agreement, that the respondent violated the
     Hatch Act by being a candidate for election to a partisan political office while he
     was a full-time employee of the U.S. Postal Service (USPS), ORDER USPS to
                                                                                        2

     suspend the respondent without pay for 180 days consistent with the terms of the
     agreement, and DISMISS this matter as settled.

                                      BACKGROUND
¶2         The Office of Special Counsel (OSC) initiated this proceeding by filing a
     complaint for disciplinary action against the respondent for violating the Hatch
     Act, which generally restricts the political activity of Federal employees.
     Complaint File (CF), Tab 1 at 4. Specifically, OSC alleged that the respondent
     violated 5 U.S.C. § 7323(a)(3) and 5 C.F.R. § 734.304 by being a candidate for
     the partisan political office of County Commissioner of Sevier County,
     Tennessee, in the 2014 general election while he was a full-time USPS employee
     at the Seymour Post Office located in Sevier County, Tennessee. CF, Tab 1 at 5.
¶3         After the matter was assigned to an administrative law judge for
     adjudication, the parties filed a joint motion for approval and enforceme nt of their
     settlement agreement.     CF, Tab 3.     Under the terms of the agreement, the
     respondent admitted that he violated the Hatch Act’s prohibition against being a
     candidate for partisan political office while being a full-time USPS employee
     during the 2014 general election, and he agreed and accepted that, as a penalty for
     his action, he would be suspended without pay from his USPS position for
     180 days. Id. at 7-8. OSC agreed not to reinstitute this Hatch Act c omplaint
     absent a material breach of the terms of the settlement agreement. Id. at 8. The
     parties requested that the administrative law judge approve the agreement, order
     USPS to suspend the respondent without pay for 180 days, enter the agreement
     into the record so that the Board will retain jurisdiction to ensure compliance with
     the agreement, and dismiss the complaint with prejudice as settled. Id. at 5-6.
¶4         The administrative law judge raised concerns with the parties about the
     validity of the agreement because the respondent had been elected to and
     continued to hold the state office.    CF, Tab 5.    The administrative law judge
     ordered the parties to file written submissions addressing whether the Hatch Act
                                                                                        3

     and Board precedent permit a settlement agreement allowing a respondent to
     maintain both a Federal and state-elected position, “which generated a Hatch Act
     complaint before the Board.”         Id. at 3.   The administrative law judge further
     ordered that, if the parties maintained that such a settlement is permitted, then
     they must modify the proposed settlement agreement to include language
     specifying whether the respondent may retain both positions. Id.
¶5           OSC responded that the Hatch Act permits a settlement agreement allowing
     a respondent to maintain his Federal position and an elected office that was won
     in violation of the Hatch Act. 1 CF, Tab 6. OSC explained that the Hatch Act
     does not prohibit a Federal employee from holding an elected office but rather
     prohibits a Federal employee from running for the nomination or as a candidate
     for the election to a partisan political office.         Id. at 4-5 (citing 5 U.S.C.
     § 7323(a)(3); 39 U.S.C. § 410(b)(1)). OSC argued that Board precedent did not
     require a Federal employee to vacate an elected office as a condition of a
     settlement agreement and that, to the extent language in prior Board decisions
     may have suggested otherwise, such language was not controlling after the Hatch
     Act Modernization Act of 2012 (Modernization Act), Pub. L. No. 112-230,
     126 Stat. 1616 (2012), which increased the Board’s discretion in imposing
     appropriate penalties for Hatch Act violations. CF, Tab 6 at 5-6. OSC asserted
     that the 180-day suspension is a substantial penalty within the range of
     permissible penalties under the Modernization Act. Id. at 7. OSC submitted a
     Modified Settlement Agreement, executed by OSC and counsel for the
     respondent, which included provisions that, “because the Hatch Act does not
     prohibit [the respondent] from holding the elective County Commissioner office,
     [OSC] will not pursue additional disciplinary action against him for continuing to
     hold the office” and that, “should [the respondent] again become a candidate for

     1
         The respondent did not file any separate response.
                                                                                        4

     partisan political office while employed in a Hatch Act-covered position, such
     action would constitute an additional violation of the Hatch Act for which OSC
     would pursue disciplinary action against him.” Id. at 10-11.
¶6         The administrative law judge found that the Modified Settlement Agreement
     is inconsistent with the Hatch Act and Board precedent indicating that holding an
     elected office is an aggravating factor in determining the penalty for a Hatch Act
     violation. CF, Tab 7 at 2, 4-7 (citing Special Counsel v. Bradford, 62 M.S.P.R.
     239 (1994), as modified on recons., 69 M.S.P.R. 247 (1995)). The administrative
     law judge further found that the Modernization Act does not support allowing an
     individual who knowingly violates the Hatch Act to retain both his Federal
     employment and elected position obtained by the violation.        Id. at 7-11. The
     administrative law judge disapproved the settlement agreement and certified his
     ruling for interlocutory review by the Board. Id. at 11.

                                         ANALYSIS
     The administrative law judge properly certified an interlocutory appeal.
¶7         An interlocutory appeal is an appeal to the Board of a ruling made by a
     judge during a Board proceeding. 5 C.F.R. § 1201.91. The Board’s regulations
     permit a judge, on his own motion, to certify an interlocutory appeal if the issue
     presented is of such importance to the proceeding that it requires the Board’s
     immediate attention. Id. The ruling must involve an important question of law or
     policy about which there is substantial ground for difference of opinion . 5 C.F.R.
     § 1201.92.   Further, the circumstances must be such that either an immediate
     ruling will materially advance the completion of the proceeding or the denial of
     an immediate ruling will cause undue harm to a party or the public. Id. We find
     these requirements are satisfied here.    The Board has not addressed the issue
     presented since the enactment of the Modernization Act, and an immediate ruling
     avoids the potential for the unnecessary expenditure of the parties’ and the
     Board’s resources in litigating matters that, in the interest of justice and judicial
                                                                                        5

      economy, can be appropriately resolved on the existing record pursuant to the
      parties’ settlement agreement.

      The parties’ Modified Settlement Agreement is valid.
¶8         Under 5 U.S.C. § 7323(a)(3), a Federal employee may not “run for the
      nomination or as a candidate for election to a partisan political office.” It is not
      the holding of the office that violates the Hatch Act but rather partisan candidacy
      for that office. E.g., Special Counsel v. Bradford, 69 M.S.P.R. 247, 249 (1995).
      The prohibition against such a candidacy applies to USPS employees such as the
      respondent. See 39 U.S.C. § 410(b)(1); Special Counsel v. Lewis, 121 M.S.P.R.
      109, ¶ 2, aff’d, 594 F. App’x 974 (Fed. Cir. 2014).
¶9         OSC investigates allegations of such prohibited political activity and may
      seek disciplinary action by filing a complaint with the Board.             5 U.S.C.
      §§ 1215(a)(1)(B), 1216.     If the Board finds the employee has engaged in
      prohibited political activity, current law provides that the Board “may impose”
      the following penalties: (1) “disciplinary action consisting of removal, reduction
      in grade, debarment from Federal employment for a period not to exceed 5 years,
      suspension, or reprimand”; (2) “an assessment of a civil penalty not to exceed
      $1,000”; or (3) any combination of such disciplinary actions and civil penalty.
      5 U.S.C. §§ 1215(a)(3)(A), 7326.
¶10        The Board favors the use of settlements to avoid the unnecessary
      expenditure of resources and litigation. Special Counsel v. Giles, 56 M.S.P.R.
      465, 467 (1993).    A settlement must be freely entered and lawful on its face
      before the Board will give it any effect. See id.; Special Counsel v. Reckard,
      69 M.S.P.R. 130, 132 (1995). There are additional considerations when, as here,
      the settled Board proceeding is based on a disciplinary action complaint brought
      by OSC and the employing agency is not a party to the settlement agreement. See
      Special Counsel v. Evans-Hamilton, 29 M.S.P.R. 516, 517 n.1 (1984). In such a
      situation, the Board must exercise its statutory penalty authority to direct the
      nonparty, employing agency to effect any agreed upon and approved discipline.
                                                                                       6

      Id. The Board may reject a settlement of a disciplinary action complaint if it
      provides for a penalty outside the scope of permissible penalties for a Hatch Act
      violation. Reckard, 69 M.S.P.R. at 132.
¶11        Here, the parties have asked the Board to accept their settlement agreement
      under which the respondent would be suspended from his USPS position without
      pay for 180 days. A suspension is within the scope of permissible penalties the
      Board may impose under current law for a Hatch Act violation.             5 U.S.C.
      § 1215(a)(3)(A).   We find nothing in the statute that requires an employee to
      relinquish the elected position before the Board may impose an authorized
      penalty less than removal. See 5 U.S.C. §§ 1215, 7323.
¶12        Prior to the enactment of the Modernization Act, the Board’s penalty
      authority for Hatch Act violations was more restricted. Prior law required that an
      individual found to have violated the Hatch Act would be removed from his
      Federal position unless the Board found by unanimous vote that the violation did
      not warrant removal. Lewis, 121 M.S.P.R. 109, ¶ 20. If that unanimous finding
      was made, the Board could direct the Federal employing agency to impose a
      suspension of not less than 30 days.      Id.; e.g., Special Counsel v. Zanjani,
      21 M.S.P.R. 67, 69 (1984). A respondent found to have violated the Hatch Act
      bore the burden of presenting evidence showing that the presumptive penalty of
      removal should not be imposed. Lewis, 121 M.S.P.R. 109, ¶ 20.
¶13        Given these prior restrictions, the Board generally would not accept a
      settlement of a Hatch Act complaint that would result in a penalty less than
      removal of the Federal employee unless the record contained stipulations or
      admissions as to the circumstances of the violation or to relevant mitigating or
      aggravating factors. See Special Counsel v. Baker, 69 M.S.P.R. 36, 39 (1995);
      Zanjani, 21 M.S.P.R. at 69. In that context, the Board would, as in the Bradford
      case cited by the administrative law judge, take into account an employee’s
      refusal to relinquish his elected position as an aggravating fact or in determining
      the appropriate penalty for a Hatch Act violation. Bradford, 69 M.S.P.R. at 250.
                                                                                      7

      Conversely, an employee’s decision to forgo the elected position could be
      considered a mitigating factor. See Special Counsel v. DeWitt, 113 M.S.P.R. 458,
      ¶¶ 3, 6-7 (2010); Special Counsel v. Pierce, 85 M.S.P.R. 281, ¶¶ 2-5 (2000). To
      the extent, however, that such pre-Modernization Act cases could be read as
      imposing a requirement that a Federal employee relinquish an elected office as a
      condition of accepting a settlement providing for the suspension, rather than
      removal, of the employee from Federal service, we find that such a requirement
      would not apply under current law.
¶14        Under current law, removal is no longer the presumptive penalty for a
      Hatch Act violation, and a unanimous vote of the Board is no longer required to
      impose a penalty of less than removal.      Lewis, 121 M.S.P.R. 109, ¶¶ 20-21.
      Further, the range of appropriate penalties has been expanded to encompass a
      broader array of lesser disciplinary actions, identical to the range of penalties
      available when OSC brings a complaint for disciplinary action based on a
      prohibited personnel practice.   5 U.S.C. § 1215(a)(3)(A); Lewis, 121 M.S.P.R.
      109, ¶ 21; see S. Rep. No. 112-211, as reprinted in 2012 U.S.C.A.A.N. 750,
      754-55. When adjudicating a complaint under the Modernization Act, the Board
      will apply the factors set forth in Douglas v. Veterans Administration, 5 M.S.P.R.
      280, 305-06 (1981), in determining the proper penalty for a Federal employee’s
      violation of the Hatch Act. Lewis, 121 M.S.P.R. 109, ¶ 23.
¶15        We find, however, that a Douglas factors analysis is not required under the
      Modernization Act before the Board may accept and approve a settlement
      agreement that would result in a disciplinary action short of removal for a
      violation of 5 U.S.C. § 7323. The Board has not required such an analysis before
      accepting settlements in another analogous situation within its original
      jurisdiction: disciplinary actions against administrative law judges. By statute,
      certain disciplinary actions against administrative law judges may be taken “only
      for good cause established and determined by the [Board] on the record after
      opportunity for hearing.” 5 U.S.C. § 7521. In such matters, the choice of penalty
                                                                                        8

      is for the Board, which will look to the relevant Douglas factors as guidance in
      making its decision.         E.g., Social Security Administration v. Steverson,
      111 M.S.P.R. 649, ¶ 18 (2009), aff’d, 383 F. App’x 939 (Fed. Cir. 2010). The
      Board has relied on stipulations in a settlement agree ment to find good cause for
      disciplining an administrative law judge and has authorized agreed -upon penalties
      that are lawful on their face without engaging in an independent analysis of the
      Douglas factors.     See Social Security Administration v. Liebling, 71 M.S.P.R.
      465, 466-67 (1996); Social Security Administration, Department of Health &
      Human Services v. Givens, 27 M.S.P.R. 360, 361-62 & n.2 (1985).
¶16            We find that the Modified Settlement Agreement has been freely entered
      into by the parties and is lawful on its face.       The parties’ stipulations are
      sufficient to establish that the respondent violated the Hatch Act, 5 U.S.C.
      § 7323(a)(3), and the discipline to which the respondent has agreed (a 180-day
      suspension without pay), is within the range of statutorily authorized penalties for
      such a violation, see 5 U.S.C. §§ 1215(a)(3)(A), 7326.       We find no basis for
      concluding that settlement of the complaint on the agreed terms would be against
      the interest of justice or prejudicial to the respondent or any other interested
      party.

                                            ORDER
¶17            Accordingly, we APPROVE the parties’ Modified Settlement Agreement,
      ENTER it into the record for enforcement purposes, and DISMISS this matter
      with prejudice as settled.
¶18            We ORDER the USPS to suspend the respondent without pay for 180 days.
      We ORDER the Office of Special Counsel to notify the Board within 30 days of
      this Opinion and Order whether the respondent has been suspended as ordered.
      This is the final decision of the Merit Systems Protection Board in this matter.
      5 C.F.R. § 1201.126.
                                                                                   9

                         NOTICE TO THE PARTIES
                     OF THEIR ENFORCEMENT RIGHTS

      If the petitioner or the respondent has not fully carried out the terms of the
agreement, either party may ask the Board to enforce the settlement agreement by
promptly filing a petition for enforcement with the Office of the Clerk of th e
Board. The petition should contain specific reasons why the petitioning party
believes that the terms of the settlement agreement have not been fully carried
out, and should include the dates and results of any communications between the
parties. 5 C.F.R. § 1201.182; see 5 C.F.R. § 1201.121(b)(2).

                        NOTICE OF APPEAL RIGHTS
      You may obtain review of this final decision. 5 U.S.C. § 7703(a)(1). By
statute, the nature of your claims determines the time limit for seeking such
review and the appropriate forum with which to file.           5 U.S.C. § 7703(b).
Although we offer the following summary of available appeal rights, the Merit
Systems Protection Board does not provide legal advice on which option is most
appropriate for your situation and the rights described below do not represent a
statement of how courts will rule regarding which cases fall within their
jurisdiction.   If you wish to seek review of this final decision, you should
immediately review the law applicable to your claims and carefully follow all
filing time limits and requirements. Failure to file within the applicable time
limit may result in the dismissal of your case by your chosen forum.
      Please read carefully each of the three main possible choices of review
below to decide which one applies to your particular case. If you have questions
about whether a particular forum is the appropriate one to review your case, you
should contact that forum for more information.

      (1) Judicial review in general. As a general rule, an appellant seeking
judicial review of a final Board order must file a petition for review with the U.S.
Court of Appeals for the Federal Circuit, which must be received by the court
                                                                                        10

within 60 calendar days of the date of issuance of this decision.                 5 U.S.C.
§ 7703(b)(1)(A).
      If you submit a petition for review to the U.S. Court of Appeals for the
Federal   Circuit,   you   must   submit    your   petition    to   the   court    at   the
following address:
                              U.S. Court of Appeals
                              for the Federal Circuit
                             717 Madison Place, N.W.
                             Washington, D.C. 20439

      Additional information about the U.S. Court of Appeals for the Federal
Circuit is available at the court’s website, www.cafc.uscourts.gov. Of partic ular
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, 10, and 11.
      If you are interested in securing pro bono representation for an appeal to
the U.S. Court of Appeals for the Federal Circuit, you may visit our website at
http://www.mspb.gov/probono for information regarding pro bono representation
for Merit Systems Protection Board appellants before the Federal Circuit. The
Board neither endorses the services provided by any attorney nor warrants that
any attorney will accept representation in a given case.

      (2) Judicial   or    EEOC    review     of   cases      involving    a   claim     of
discrimination. This option applies to you only if you have claimed that you
were affected by an action that is appealable to the Board and that such action
was based, in whole or in part, on unlawful discrimination. If so, you may obtain
judicial review of this decision—including a disposition of your discrimination
claims—by filing a civil action with an appropriate U.S. district court (not the
U.S. Court of Appeals for the Federal Circuit), within 30 calendar days after you
receive this decision.      5 U.S.C. § 7703(b)(2); see Perry v. Merit Systems
Protection Board, 582 U.S. ____ , 137 S. Ct. 1975 (2017).                 If you have a
representative in this case, and your representative receives this decision before
                                                                                11

you do, then you must file with the district court no later than 30 calendar days
after your representative receives this decision. If the action involves a claim of
discrimination based on race, color, religion, sex, national origin, or a disabling
condition, you may be entitled to representation 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) and 29 U.S.C. § 794a.
      Contact information for U.S. district courts can be found at their respective
websites, which can be accessed through the link below:
      http://www.uscourts.gov/Court_Locator/CourtWebsites.aspx.
      Alternatively, you may request review by the Equal Employment
Opportunity Commission (EEOC) of your discrimination claims only, excluding
all other issues. 5 U.S.C. § 7702(b)(1). You must file any such request with the
EEOC’s Office of Federal Operations within 30 calendar days after you receive
this decision. 5 U.S.C. § 7702(b)(1). If you have a representative in this case,
and your representative receives this decision before you do, then you must file
with the EEOC no later than 30 calendar days after your representative receives
this decision.
      If you submit a request for review to the EEOC by regular U.S. mail, the
address of the EEOC is:
                         Office of Federal Operations
                  Equal Employment Opportunity Commission
                               P.O. Box 77960
                          Washington, D.C. 20013

      If you submit a request for review to the EEOC via commercial delivery or
by a method requiring a signature, it must be addressed to:
                         Office of Federal Operations
                  Equal Employment Opportunity Commission
                              131 M Street, N.E.
                                Suite 5SW12G
                          Washington, D.C. 20507
                                                                                     12

      (3) Judicial    review     pursuant    to   the    Whistleblower      Protection
Enhancement Act of 2012. This option applies to you only if you have raised
claims of reprisal for whistleblowing disclosures under 5 U.S.C. § 2302(b)(8) or
other protected activities listed in 5 U.S.C. § 2302(b)(9)(A)(i), (B), (C), or (D).
If so, and your judicial petition for review “raises no challenge to the Board's
disposition of allegations of a prohibited personnel practice described in section
2302(b) other than practices described in section 2302(b)(8), or 2302(b)(9)(A)(i),
(B), (C), or (D),” then you may file a petition for judicial review either with the
U.S. Court of Appeals for the Federal Circuit or any court of appeals of
competent jurisdiction. 2   The court of appeals must receive your petition for
review within 60 days of the date of issuance of this decision.               5 U.S.C.
§ 7703(b)(1)(B).
      If you submit a petition for judicial review to the U.S. Court of Appeals for
the Federal Circuit, you must submit your petition to the court at the
following address:
                                U.S. Court of Appeals
                                for the Federal Circuit
                               717 Madison Place, N.W.
                               Washington, D.C. 20439

      Additional information about the U.S. Court of Appeals for the Federal
Circuit 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, 10, and 11.

2
   The original statutory provision that provided for judicial review of certain
whistleblower claims by any court of appeals of competent jurisdiction expired on
December 27, 2017. The All Circuit Review Act, signed into law by the President on
July 7, 2018, permanently allows appellants to file petitions for judicial review of
MSPB decisions in certain whistleblower reprisal cases with the U.S. Court of Appeals
for the Federal Circuit or any other circuit court of appeals of competent jurisdiction.
The All Circuit Review Act is retroactive to November 26, 2017. Pub. L. No. 115 -195,
132 Stat. 1510.
                                                                             13

      If you are interested in securing pro bono representation for an appeal to
the U.S. Court of Appeals for the Federal Circuit, you may visit our website at
http://www.mspb.gov/probono for information regarding pro bono representation
for Merit Systems Protection Board appellants before the Federal Circuit. The
Board neither endorses the services provided by any attorney nor warrants that
any attorney will accept representation in a given case.
      Contact information for the courts of appeals can be found at their
respective websites, which can be accessed through the link below:
      http://www.uscourts.gov/Court_Locator/CourtWebsites.aspx.

FOR THE BOARD:

/s/
Jennifer Everling
Acting Clerk of the Board
Washington, D.C.