Lloyd L. Tunik v. M.S.P.B.

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Error: Bad annotation destination
United States Court of Appeals for the Federal Circuit

03-3286, -3330, -3331

LLOYD L. TUNIK,

Petitioner,
and

VERRELL DETHLOFF, THOMAS S. ROBINSON, MARGUERITE
SCHELLENTRAGER, KAREN BAKER, BRYAN BERNSTEIN, and
TELA L. GATEWOOD,

Petitioners,
and

JOSEPH SCHLOSS,

Petitioner,

v.

MERIT SYSTEMS PROTECTION BOARD,

Respondent,
and

SOCIAL SECURITY ADMINISTRATION,

Intervenor.

Michael J. Kator, Kator, Parks & Weiser, P.L.L.C., of Washington, DC, argued for
petitioners.

Calvin M. Morrow, Attorney, Office of the General Counsel, United States Merit
Systems Protection Board, of Washington, DC, argued for respondent. With him on the
brief were Martha B. Schneider, General Counsel, and Stephanie M. Conley, Reviewing
Attorney.

Douglas K. Mickle, Trial Attorney, Commercial Litigation Branch, Civil Division,
United States Department of Justice, of Washington, DC, for intervenor. With him on the
brief were Peter D. Keisler, Assistant Attorney General, David M. Cohen, Director, and
Todd M. Hughes, Assistant Director. Of counsel on the brief was Shawn S. McGruder,
Office of General Counsel, Social Security Administration, of Baltimore, Maryland.
 Sally M. Tedrow, O’Donoghue & O’Donoghue LLP, of Washington, DC, for amici
curiae Association of Administrative Law Judges, IFPTE, AFL-CIO, et al.

Joyce E. Kitchens, Kitchens/New, L.L.C., of Atlanta, Georgia, for amicus curiae
Federal Bar Association.

Appealed from: United States Merit Systems Protection Board
United States Court of Appeals for the Federal Circuit

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LLOYD L. TUNIK,

Petitioner,

and

VERRELL DETHLOFF, THOMAS S. ROBINSON, MARGUERITE SCHELLENTRAGER,
KAREN BAKER, BRYAN BERNSTEIN, and
TELA L. GATEWOOD,

Petitioners,

and

JOSEPH SCHLOSS,

Petitioner,

v.

MERIT SYSTEMS PROTECTION BOARD,

Respondent,

and

SOCIAL SECURITY ADMINISTRATION,

Intervenor.

__________________________

DECIDED: May 11, 2005
__________________________
Before LOURIE, SCHALL, and LINN Circuit Judges.

Opinion for the Court filed by Circuit Judge LINN. Dissenting opinion filed by Circuit
Judge SCHALL.

LINN, Circuit Judge.

Lloyd L. Tunik (“Tunik”), Verrell Dethloff et al. (“Dethloff”), and Joseph Schloss

(“Schloss”) petition for review of the Merit Systems Protection Board’s (“Board”)

dismissal of each of their appeals for lack of jurisdiction. Tunik v. Social Sec. Admin.,

93 M.S.P.R. 482 (2003); Dethloff v. Social Sec. Admin., 93 M.S.P.R. 574 (2003);

Schloss v. Social Sec. Admin., 93 M.S.P.R. 578 (2003). Their separate appeals were

consolidated before this court because there is a common issue among them. Because

Tunik’s case is moot, we vacate the Board’s opinion in his case and remand with

instructions to dismiss. Because in the remaining cases the Board erred in attempting

to repeal by adjudication its rule adopted pursuant to notice and comment rulemaking,

we reverse and remand.

I. BACKGROUND

Tunik was an Administrative Law Judge (“ALJ”) with the Social Security

Administration (“Agency”). During the course of his employment, Tunik issued an

opinion remanding a disability claim to a state agency due to asserted deficiencies in

the state agency’s consideration of the claim. Subsequently, Tunik informed Acting

Regional Chief Administrative Law Judge Mary Bisantz (“Bisantz”) of his disposition of

the case and his similar disposition of other cases. The state agency refused to comply

with the remand order and sent the case back to the Agency. Several months after

being informed of Tunik’s actions, Bisantz reviewed Tunik’s decision and issued a

memorandum to Acting Spokane Hearing Office Chief Administrative Law Judge Mary

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Reed (“Reed”) asserting that Tunik had improperly dismissed the case. The

memorandum also instructed Reed to inform Tunik that his decision was invalid and to

offer him the opportunity to rectify his alleged mistake by vacating the dismissal order

and hearing the case on its merits. Bisantz also sent a memorandum to Tunik informing

him that his decision in the case was without legal justification and could result in

disciplinary action.

Tunik sent a memorandum to the Agency’s Chief Administrative Law Judge

protesting Bisantz’s actions. Nevertheless, Tunik vacated his original order remanding

the case to the state agency. In his consideration of the case on the merits, Tunik

drafted a new decision holding that the claimant had been denied due process of law by

the lack of a proper decision by the state agency. Reed reviewed the decision prior to

its issuance and notified Bisantz of its contents. Bisantz instructed Reed to prevent the

decision from issuing and to transfer the case file to Bisantz. Bisantz ultimately allowed

the decision to issue with a minor non-substantive change.

During the course of the above events, Tunik remanded a second case to the

state agency on the same grounds as the first remand. Bisantz issued a second

memorandum to Tunik informing him of the state agency’s protest of this second

decision. Reed again informed Tunik that he should vacate his order, or the case would

be reassigned. Tunik vacated his remand order in the second case and took the case

up on the merits.

A few weeks after vacating his remand order in the second case, Tunik filed a

complaint with the Board alleging that Bisantz’s and Reed’s actions had interfered with

his decisional independence. Tunik filed a motion for summary judgment, which the

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ALJ granted on December 14, 2000. Both sides filed petitions for review before the

Board. Before the Board rendered its decision, Tunik voluntarily retired effective May

31, 2003. Nevertheless, on June 27, 2003, the Board reversed the initial decision and

dismissed the appeal for lack of jurisdiction. Tunik v. Social Sec. Admin., 93 M.S.P.R.

482 (2003). In doing so, the Board overruled its prior decision in In re Doyle, 29

M.S.P.R. 170 (1985), which had recognized an action for “constructive” removal before

the Board under 5 U.S.C. § 7521, even though the claimant had not been actually

separated from his or her position. 93 M.S.P.R. at 488-92. The Board based its

reconsideration on our decision in Butler v. Social Security Administration, 331 F.3d

1368 (Fed. Cir. 2003), and on the perceived lack of support for such a construction of

section 7521 even at the time Doyle was decided. Tunik timely filed a petition for review

with this court.

Dethloff and numerous other ALJs with the Agency challenged various Agency

practices that allegedly interfered with the requirement in 5 U.S.C. § 3105 that case

assignments to ALJs occur in rotational order. Dethloff himself was taken out of the

assignment rotation for recommended on-the-record cases. On June 21, 2002, the

Board’s ALJ issued an Interim Decision dismissing most of the claims for lack of

jurisdiction because the ALJs had failed to allege facts showing that the failure to assign

cases on a rotational basis caused their constructive removal. Dethloff v. Social Sec.

Admin., No. CB-7521-02-0008-T-1 (M.S.P.B. June 21, 2002) (interim decision).

Subsequently, on August 7, 2002, the ALJ issued a First Initial Decision denying

reconsideration of the Interim Decision and granting entry of a settlement agreement

with respect to the remaining claims. Dethloff v. Social Sec. Admin., No. CB-7521-02-

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0008-T-1 (M.S.P.B. Aug. 7, 2002) (first initial decision). However, on July 31, 2003, on

the ALJs’ petition for review, the Board re-opened the case sua sponte and issued a

new opinion citing Tunik and holding that the ALJs had not alleged that they were

actually separated from their positions. Dethloff v. Social Sec. Admin., 93 M.S.P.R. 574

(2003). Thus, the Board dismissed the appeals for lack of jurisdiction. Id. at 577.

Dethloff and the other ALJs timely petitioned for review with this court.

Schloss is also an ALJ with the Agency. Schloss was assigned to decide a claim

for disability benefits. The claimant’s representative sent two letters to Schloss seeking

a favorable on-the-record decision on the claim. However, the letters were delayed in

being transmitted to Schloss. After each letter was sent to Schloss, the claimant’s

representative sent a letter to Hearing Office Chief Administrative Law Judge Riley

Atkins (“Atkins”), Schloss’s supervisor. The two letters alleged that Schloss was

imposing an improper legal standard related to a request for an on-the-record decision.

Schloss ultimately denied the request for an on-the-record decision.

After reviewing Schloss’s decision, Atkins reassigned the case to another ALJ.

Schloss filed a complaint with the Board. The presiding judge held that the Agency had

interfered with Schloss’s qualified decisional independence in reassigning the case.

However, on July 28, 2003, the Board reversed the presiding judge’s Initial Decision

and, citing Tunik, held that the Board had no jurisdiction over the case. Schloss v.

Social Sec. Admin., 93 M.S.P.R. 578 (2003). Schloss timely petitioned for review with

this court.

We have jurisdiction pursuant to 28 U.S.C. § 1295(a)(9).

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 II. DISCUSSION

A. Standard of Review

This court must affirm the Board’s decision unless it is: “(1) arbitrary, capricious,

an abuse of discretion, or otherwise not in accordance with law; (2) obtained without

procedures required by law, rule, or regulation having been followed; or (3) unsupported

by substantial evidence.” 5 U.S.C. § 7703(c) (2000). Whether the Board has jurisdiction

to hear an appeal is a question of law reviewed de novo. Diefenderfer v. Merit Sys.

Prot. Bd., 194 F.3d 1275, 1277 (Fed. Cir. 1999). The Board’s jurisdiction is limited to

those actions specifically granted by law, rule, or regulation. 5 U.S.C. § 7701(a) (2000);

Meeker v. Merit Sys. Prot. Bd., 319 F.3d 1368, 1374 (Fed. Cir. 2003).

B. Analysis

1. Tunik’s Appeal

As a preliminary matter, the Agency, as Intervenor, argues that Tunik’s appeal is

moot because he voluntarily retired. Tunik responds that his claim for attorney’s fees

remains alive and that he may choose to claim on remand that his retirement was

involuntary. Moreover, he argues that there remains a risk that the Agency would take

similar actions to impair his decisional independence in the future. First, we are unable

to discern the claim for attorney’s fees to which Tunik refers. He has presented no

claim for attorney’s fees to this court, nor did he present a claim for attorney’s fees to

the Board. Moreover, even if he had presented a claim for attorney’s fees, “[an] interest

in attorney’s fees is, of course, insufficient to create an Article III case or controversy

where none exists on the merits of the underlying claim.” Lewis v. Continental Bank

Corp., 494 U.S. 472, 480 (1990). Second, although Tunik is free to assert a claim that

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his retirement was in fact involuntary, he has not done so before this court, nor has he

done so before the Board. Thus, any claim for involuntary retirement is not a part of this

case and is not before us. Tunik’s complaint only seeks prospective relief to prevent his

supervisors from interfering with his decisional independence. Given that Tunik has

retired, it is difficult to see how any of Tunik’s supervisors could interfere with his

decisional independence in the future. Thus, Tunik’s appeal is moot and must be

dismissed. County of Los Angeles v. Davis, 440 U.S. 625, 631 (1979) (“[J]urisdiction,

properly acquired, may abate if the case becomes moot because (1) it can be said with

assurance that ‘there is no reasonable expectation . . .’ that the alleged violation will

recur and (2) interim relief or events have completely and irrevocably eradicated the

effects of the alleged violation.” (citation omitted)); United States v. Concentrated

Phosphate Exp. Ass’n, 393 U.S. 199, 203 (1968) (“A case might become moot if

subsequent events made it absolutely clear that the allegedly wrongful behavior could

not reasonably be expected to recur.”).

The fact that Tunik’s appeal is moot is not changed by 5 U.S.C. § 7701(j). That

statute states:

In determining the appealability under this section of any case
involving a removal from the service (other than the removal of a
reemployed annuitant), neither an individual’s status under any retirement
system established by or under Federal statute nor any election made by
such individual under any such system may be taken into account.

5 U.S.C. § 7701(j) (2000). In Mays v. Department of Transportation, 27 F.3d 1577,

1579 (Fed. Cir. 1994), we held that “[t]he plain language of section 7701(j) means that

retirement status cannot be taken into account in determining the appealability of ‘any

case involving a removal.’” That case involved an employee of the Department of

Transportation that retired on the effective date of her removal. We held that her

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retirement did not render her appeal moot under the statute. Id. However, Mays

involved an involuntary retirement. Id. at 1580 (“[T]he agency does not dispute that

Mays would not have retired when she did if it had not been for the removal action.”);

see also Heelen v. Dep’t of Commerce, 154 F.3d 1306, 1309 n.1 (Fed. Cir. 1998)

(applying section 7701(j) again in the context of an involuntary retirement). If Mays

prevailed in her action, presumably she would have been entitled to some relief, even

though she retired in the interim. Here, however, even if Tunik prevails, it is “absolutely

clear that the allegedly wrongful behavior could not reasonably be expected to recur.”

Concentrated Phosphate, 393 U.S. at 203. Even if the statute extended to the situation

before us, it could not confer authority on this court to hear a case where that authority

is constitutionally lacking. See Sec. & Exch. Comm’n v. Med. Comm. for Human Rights,

404 U.S. 403, 407 (1972) (“Our lack of jurisdiction to review moot cases derives from

the requirement of Article III of the Constitution under which the exercise of judicial

power depends upon the existence of a case or controversy.” (quotation marks and

citation omitted)).

The fact that Tunik retired prior to the Board’s decision in this case raises an

additional issue. Although the Board is a creature of statute and is not necessarily

subject to the requirements of Article III of the Constitution, Congress has nonetheless

provided that “[t]he Board shall not issue advisory opinions.” 5 U.S.C. § 1204(h) (2000).

Given that Tunik’s appeal was moot when the Board issued its decision in this case, the

Board’s opinion was advisory and must be vacated. Because the remaining appeals

relied on and thus implicate the rationale of the Board’s decision in Tunik’s case, we will

address that rationale to the extent it relates to the other appeals before us.

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 2. Constructive Removal

Because of the number of executive agencies within the Federal Government

that both set policy and adjudicate private rights, and the need for the orderly

administration of claims relating thereto, Congress enacted the Administrative

Procedure Act (“APA”). See H.R. Rep. No. 79-1980, at 7-8 (1946); 28 Cong. Rec. 2149

(1946) (statement of Sen. McCarran). A substantial driving force behind the enactment

of the APA was the need for greater independence of those adjudicating private rights:

Furthermore, the same men are obliged to serve both as prosecutors and
as judges. This not only undermines judicial fairness; it weakens public
confidence in that fairness. Commission decisions affecting private rights
and conduct lie under the suspicion of being rationalizations of the
preliminary findings which the Commission, in the role of prosecutor,
presented to itself.

S. Rep. No. 79-752, at 3 (1945) (quoting Administrative Management in the

Government of the United States: Report of the President’s Committee 40 (1937)); see

also Ramspeck v. Fed. Trial Exam’rs Conference, 345 U.S. 128, 131-32 (1953); Final

Report of the Attorney General’s Committee on Administrative Procedure 203-09

(William S. Hein & Co. 1997) (1941) (discussing the problem of mixing legislative,

prosecutorial, and judicial functions in a single agency and proposed solutions).

To address this concern, the APA, as originally passed in 1946, provided that

agency hearings subject to the APA had to be presided over by the agency, one or

more members of the body comprising the agency, or one or more examiners as

provided in the APA. Administrative Procedure Act, Pub. L. No. 79-404, § 7(a), 60 Stat.

237, 241 (1946) (current version at 5 U.S.C. § 556 (2000)). In an effort to maintain a

level of independence for the examiners, the APA provided for employment of

examiners by each agency subject to certain restrictions. Id. § 11, 60 Stat. at 244.

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Section 11 of the APA stated, “Examiners shall be removable by the agency in which

they are employed only for good cause established and determined by the Civil Service

Commission . . . after opportunity for hearing and upon the record thereof.” Id.

The Civil Service Reform Act of 1978 created the Merit Systems Protection

Board and placed it in the role of the Civil Service Commission as the body with

authority to decide whether an ALJ could properly be disciplined by an employing

agency. Civil Service Reform Act of 1978, Pub. L. No. 95-454, § 202, 92 Stat. 1111,

1121-31. The Civil Service Reform Act also revised section 7521 and placed it

substantially in its current form. Id. § 204, 92 Stat. at 1137. The current version states:

(a) An action may be taken against an administrative law judge
appointed under section 3105 of this title by the agency in which the
administrative law judge is employed only for good cause established and
determined by the Merit Systems Protection Board on the record after
opportunity for hearing before the Board.
(b) The actions covered by this section are—
(1) a removal;
(2) a suspension;
(3) a reduction in grade;
(4) a reduction in pay; and
(5) a furlough of 30 days or less . . . .

5 U.S.C. § 7521 (2000).

In In re Doyle, 29 M.S.P.R. 170 (1985), the Board interpreted an earlier but

substantively similar version of section 7521 to protect ALJs from more than actual

separation from employment. In interpreting “removal” under the statute, the Board

concluded that an ALJ could bring a claim for removal under section 7521 even though

the offending conduct was less than physical separation from federal employment. The

Board based its decision on the history and remedial purpose of the APA. 29 M.S.P.R.

at 174-75. The Board held that “‘removal’ has consistently been interpreted as

protecting an administrative law judge from actions of his employing agency that could

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impair his qualified judicial independence.” Id. at 174. The Board subsequently codified

the holding of Doyle pursuant to notice and comment rulemaking at 5 C.F.R.

§ 1201.142. Merit Systems Protection Board Practices and Procedures, 62 Fed. Reg.

48449, 48455 (Sept. 16, 1997) (interim rule, request for comments); Merit Systems

Protection Board Practices and Procedures, 63 Fed. Reg. 42685 (Aug. 11, 1998) (final

rule).

The Board applied this standard in two subsequent cases that were appealed to

this court. First, in Sannier v. Merit Systems Protection Board, 931 F.2d 856 (Fed. Cir.

1991), a group of ALJs from the Social Security Administration challenged various

management practices allegedly intended to promote productivity at the Lansing,

Michigan Office of Hearings and Appeals. Because the practices complained of

involved, inter alia, refusing to replace ALJs at the particular office until productivity

increased and asking ALJs to transfer out of that office so it could be closed, we held

that the Board properly determined that it did not have jurisdiction over the action. In

reaching this decision, we quoted the Board’s standard set forth in Doyle. Agreeing with

the Board’s standard, we said, “Well-pleaded allegations tying the agency actions to

impairment of their decisionmaking independence are, at minimum, necessary to

establish prima facie Board jurisdiction.” Id. at 858. Further, in rejecting the ALJs’ claim

that they had pled sufficient facts to warrant Board jurisdiction whether or not they would

ultimately prevail, this court applied the Doyle standard. We said that even “assum[ing]

arguendo that the agency explicitly instituted overall targets or goals for the number of

appeals to be adjudicated per month, such production targets simply are not, by

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themselves, probative that the ALJ’s impartiality or independence in a particular appeal

has been or would be compromised.” Id. at 859.

In Stephens v. Merit Systems Protection Board, 986 F.2d 493 (Fed. Cir. 1993),

Stephens argued that the Department of Health and Human Services’ requirement that

Stephens attend a specially designed course of instruction resulted in a constructive

removal under section 7521. We again affirmed the Board’s dismissal of this claim for

lack of jurisdiction. In reaching that conclusion, we noted that section 7521 was

“specifically limited to removals, suspensions, reductions in grade, reductions in pay

and furloughs of 30 days or less.” Id. at 496. Nevertheless, citing Sannier, we said that

“[t]his court has determined . . . that constructive removals are also covered by that

section.” Id. In setting forth the standard, we quoted Sannier’s quotation of Doyle

recognizing a constructive removal where an agency’s actions interfere with an ALJ’s

qualified independence. Id. As in Sannier, the court in Stephens rejected Stephens’s

argument that he was entitled to a hearing on jurisdiction because “even accepting all of

petitioner’s factual allegations as true, the Board still does not have jurisdiction because

the program and instructional course do not impair petitioner’s decisional

independence.” Id. at 497.

The petitioners argue that the Board erred in holding that it does not have

jurisdiction to hear a claim for constructive removal under section 7521 by a person not

actually separated from the position of ALJ because that holding is inconsistent with the

decisions of this court in Sannier and Stephens. In particular, the petitioners assert that

the Board is not free to reject or overrule this court’s interpretation of section 7521

applied in both Sannier and Stephens. The Board raises two arguments in response.

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First, the Board argues that because both Sannier and Stephens affirmed the Board’s

holdings that it lacked jurisdiction, the Board’s later adoption of an additional

requirement for jurisdiction—actual separation from employment as an ALJ—does not

conflict with those decisions. Second, the Board argues that our review in both Sannier

and Stephens was deferential in nature and was not a de novo interpretation of section

7521. According to the Board, this court was merely holding that the Board’s

interpretation was a reasonable one, applying Chevron U.S.A. Inc. v. Natural Resources

Defense Council, Inc., 467 U.S. 837 (1984). Thus, the Board contends it is free to

reconsider its interpretation of the statute.1

We first address the Board’s argument that its adoption of an additional

requirement does not conflict with our prior decisions in Sannier and Stephens. The

Board, citing Watson v. Department of the Navy, 262 F.3d 1292 (Fed. Cir. 2001),

argues that our holdings in Sannier and Stephens merely recognized that the facts of

those cases did not constitute removal under section 7521. According to the Board, its

1
In reaching its decision in Tunik, the Board viewed our decision in Butler v.
Social Security Administration, 331 F.3d 1368 (Fed. Cir. 2003), as requiring that
“removal” in section 7521 have exactly the same meaning as “removal” in 5 U.S.C.
§ 7512, the parallel provision governing removal of federal employees. Tunik, 93
M.S.P.R. at 486-87. The Agency as intervenor makes a similar argument before this
court. Butler concerned the Board’s jurisdiction over an appeal from an agency’s
elimination of administrative duties associated with the position of Hearing Office Chief
ALJ. 331 F.3d at 1370-71. This court held that the action did not fall under section
7521 because “the action taken by the [Social Security Administration] in divesting the
petitioner of his Hearing Office Chief duties did not reduce the petitioner’s grade or pay.”
Id. at 1372. The action also was held not to be a “removal” as defined in a regulation, 5
C.F.R. § 930.214(a) (2003), which covers “reassignment” or “demotion” “to a position
other than that of an administrative law judge.” Id. at 1373. While a claim for
constructive removal was raised before the Board by the petitioner in Butler, the
petitioner “did not properly raise this issue on appeal.” 331 F.3d at 1371 n.2. Butler did
not construe section 7521 as it pertains to constructive removals.

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holding that a removal requires actual separation from employment was not in conflict

with those decisions.

Watson does not support the Board’s argument. Watson involved a

determination as to whether certain personnel met the statutory and regulatory criteria

for early retirement coverage as law enforcement officers. 262 F.3d at 1295. In

considering the petitioners’ claims, the Merit Systems Protection Board “employed a

new approach that more affirmatively considered the reasons for the creation and

existence of the positions than it had used in its prior LEO decisions.” Id. The

petitioners argued that the new approach was inconsistent with the factors employed in

this court’s prior decision in Bingaman v. Department of the Treasury, 127 F.3d 1431

(Fed. Cir. 1997). In rejecting that contention, we said:

In examining the duties performed by these petitioners, the Bingaman
court only addressed prongs (ii) and (iii) of 5 C.F.R. §§ 831.902, 842.802.
The court did not need to consider prong (i) of the test—examining the
basic reasons for the existence of the position—because the court found
that the petitioners had failed to meet their burden of proof regarding the
second and third prongs of 5 C.F.R. §§ 831.902, 842.802.

Watson, 262 F.3d at 1301-02 (citation omitted). Thus, there was nothing in the Board’s

Watson decision that was inconsistent with this court’s analysis in Bingaman.

Moreover, the Board’s argument implies that the statement of the standard

applied in the Sannier and Stephens cases is dictum and need not be followed. The

Supreme Court, however, has rejected such a proposition. In Seminole Tribe of Florida

v. Florida, 517 U.S. 44 (1996), the Supreme Court considered whether to adhere to the

rationale expressed in a line of cases that admittedly did not involve the precise factual

issue presented in the pending case. In applying the rationale of that line of cases, the

Court said,

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 We adhere in this case, however, not to mere obiter dicta, but rather to the
well-established rationale upon which the Court based the results of its
earlier decisions. When an opinion issues for the Court, it is not only the
result but also those portions of the opinion necessary to that result by
which we are bound.

Id. at 66-67.

Our decisions in Sannier and Stephens adopted and applied the Board’s Doyle

standard. In Sannier, we said that removal under section 7521 encompasses

cumulative administrative action or active intervention that prevents the impartial

exercise of judicial function and that has a pernicious effect on qualified judicial

independence. 931 F.2d at 858 (quoting Doyle, 29 M.S.P.R. at 175). We affirmed the

Board’s application of the Doyle rationale in rejecting the ALJs’ assertions that

personnel policies designed to increase productivity constituted constructive removal,

concluding that such policies did not interfere with an ALJ’s independence or

impartiality. Id. at 858-59. Subsequently, in Stephens, we again employed the standard

expressed in Sannier to reject Stephens’s assertion that a mandatory course of

instruction amounted to constructive removal. We stated specifically, in referring to

Sannier, “This court has determined, however, that constructive removals are also

covered by that section.” 986 F.2d at 496. The Board is not free to reject the rationale

employed in reaching those decisions as dictum.

In its opinion in Tunik, the Board concluded that this court in Sannier merely

“recognized” the Doyle theory of jurisdiction. Tunik, 93 M.S.P.R. at 491. The Board

said that this court “did not create the concept or necessarily endorse it.” Id. Such a

position is difficult to reconcile with the language of Sannier and is impossible to

reconcile with Stephens, which the Board did not even mention. This court both found

the Board’s interpretation of section 7521 in Doyle to be reasonable and affirmed the

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Board’s application of the standard derived from its interpretation in deciding the

Sannier and Stephens cases.

We next address the Board’s contention that it was free to reconsider its earlier

decision in Doyle, notwithstanding our decisions in Sannier and Stephens. This entails

our consideration of the deference due the Board’s interpretation of section 7521 and

the extent to which any such deference was employed in our decisions in Sannier and

Stephens. As to the former, the parties dispute whether the Board is entitled to any

deference in its interpretation of section 7521. The Board, citing 5 U.S.C. § 1305,

argues that it is charged with administering section 7521 and that its interpretation is

entitled to deference under Chevron U.S.A. Inc. v. Natural Resources Defense Council,

Inc., 467 U.S. 837 (1984). In United States v. Mead Corp., the Supreme Court

“recognized a very good indicator of delegation meriting Chevron treatment in express

congressional authorizations to engage in the process of rulemaking or adjudication that

produces regulations or rulings for which deference is claimed.” 533 U.S. 218, 229

(2001). Section 1305 provides exactly that for the Board regarding section 7521.

Section 1305 states that “for the purpose of section 7521 of this title, the Merit Systems

Protection Board may investigate, prescribe regulations, appoint advisory committees

as necessary, recommend legislation, subpena [sic] witnesses and records, and pay

witness fees as established for the courts of the United States.” 5 U.S.C. § 1305

(2000). Further, section 7521 authorizes the Board to adjudicate whether an agency

has established good cause for disciplinary action against an ALJ. Id. § 7521 (“An

action may be taken against an administrative law judge . . . only for good cause

established and determined by the Merit Systems Protection Board on the record after

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opportunity for hearing before the Board.”). Both Sannier and Stephens involved such

adjudications. The Board has been charged with administering section 7521 through

both rulemaking and adjudication and is entitled to Chevron deference in these

activities.

In Chevron, the Supreme Court established a two-part test for evaluating an

agency interpretation of a statute. First, “[i]f the intent of Congress is clear, that is the

end of the matter; for the court, as well as the agency, must give effect to the

unambiguously expressed intent of Congress.” Chevron, 467 U.S. at 842-43. However,

“if the statute is silent or ambiguous with respect to the specific issue, the question for

the court is whether the agency’s answer is based on a permissible construction of the

statute.” Id. at 843. Thus, in determining the extent of deference given to the Board in

Sannier and Stephens, the inquiry boils down to which portion of the Chevron analysis

was applied.

Although not expressly framed under either prong of Chevron, the analysis in

Sannier falls into the latter category. The analysis in Sannier begins by quoting section

7521 but acknowledges, “Petitioners do not, and cannot, contend under these facts that

they were subjected to any of the enumerated adverse personnel actions listed in

subsection (b).” 931 F.2d at 858. After observing that the petitioners based their claim

solely on “constructive” removal, the court said, “Although a ‘constructive’ removal is not

specifically enumerated in subsection (b), the Board, as well as this court, has

recognized that certain acts may be the equivalent, for purposes of Board jurisdiction, of

formal removal.” Id. This court’s initial observation that the petitioners’ claim ventured

outside the literal language of the statute is an express acknowledgement that

03-3286, -3330, -3331 17
Congress has not unambiguously expressed its intent on the issue of constructive

removal. Where the statute is silent or ambiguous with respect to a particular issue, this

court must consider whether the agency’s interpretation is permissible. Chevron, 467

U.S. at 843.

The analysis in Sannier continues by stating that “the Board recognizes the

possibility that an ALJ may be constructively removed by ‘cumulative administrative

actions or active intervention . . . [which] prevent the impartial exercise of his judicial

functions . . . [and which have] a pernicious effect on the complaining judge’s qualified

independence.’” Sannier, 931 F.2d at 858 (quoting Doyle, 29 M.S.P.R. at 175)

(alterations in original). This court then said,

We agree with the Board that “even if [it] were to assume that the
ALJs have suffered, among other things, staffing shortages, transfer
restrictions and reduced service areas due to management’s perception
that the Lansing ALJs production rate was low, they have not alleged in
any of the many papers submitted that these actions of management have
interfered with their impartial decisionmaking ability.”

Id. (quoting In re Sannier, 45 M.S.P.R. 420, 426 (1990)) (alteration in original). It is

difficult to view the analysis in Sannier as anything other than deferential to the Board’s

interpretation of section 7521 as a permissible gap-filling in a specific area to which the

statute fails to speak. See Chevron, 467 U.S. at 843-44 (noting that Congress may

implicitly delegate authority to an agency to fill in gaps where there is not an explicit gap

in the statute).

Because the Board’s interpretation of section 7521 was reasonable, the Board’s

interpretation as set forth in Doyle and reiterated in Sannier was properly the law. See

Mead Corp., 533 U.S. at 229 (noting that it may be apparent that Congress conferred

authority on an agency to speak with the force of law even over issues about which

03-3286, -3330, -3331 18
Congress had no intent). When this court again considered the Board’s application of

section 7521, we applied the Board’s constructive removal standard as the governing

law. In Stephens, the court again noted that section 7521 is “specifically limited to

removals, suspensions, reductions in grade, reductions in pay and furloughs of 30 days

or less.” 986 F.2d at 496. Citing Sannier, we said that “[t]his court has determined,

however, that constructive removals are also covered by that section.” Id. Thus, this

court again acknowledged that constructive removal was outside the clear language of

the statute and, by implication, the clear intent of Congress. Although it is possible to

read that statement in Stephens as concluding that section 7521 expressly covers

constructive removal—i.e., that Congress’s intent on this point is clear—as discussed

supra, Sannier held that the statute was silent on this point. Even Stephens

acknowledged that the constructive removal doctrine exceeds the plain language of the

statute. The better reading of Stephens, then, is that it was merely acknowledging that

Sannier’s determination that the Board’s interpretation was permissible was sufficient to

make the Board’s interpretation the governing law. Thus, Stephens also indicates that

this court applied the second prong of Chevron to the Board’s interpretation of section

7521.

The conclusion that Sannier and Stephens reflect appropriate deference to the

Board brings us to the question of whether the Board is free to reconsider its

interpretation of section 7521, despite Sannier and Stephens. The Board relies on

Bankers Trust New York Corp. v. United States, 225 F.3d 1368, 1376 (Fed. Cir. 2000).

In Bankers Trust, this court concluded that the Court of Federal Claims erred in holding

that an Internal Revenue Service regulation trumped a prior conflicting decision of the

03-3286, -3330, -3331 19
Court of Claims. Id. at 1376. In holding that the agency was not free to overturn the

decision of its reviewing court by regulation, we distinguished the Ninth Circuit’s

decision in Mesa Verde Construction Co. v. Northern California District Council of

Laborers, 861 F.2d 1124 (9th Cir. 1988) (en banc). In Mesa Verde, the Ninth Circuit

held that where a prior panel of the court had applied an agency’s interpretation of a

statute after concluding that the agency’s interpretation was reasonable, a later panel of

the court was free to accord deference to a new agency interpretation without en banc

review, even if it conflicted with the interpretation applied in the earlier panel decision.

Id. at 1134-36. In Bankers Trust, we said, “This is not a case like Mesa Verde, in which

the original decision was itself based on deference to the agency; under such

circumstances, we might well consider the agency’s change of heart as a significant

factor.” 225 F.3d at 1376. Because we have concluded that Sannier and Stephens

were based on deference to the Board’s interpretation of section 7521, this court must

now confront directly the question presented in Mesa Verde.

We agree with Mesa Verde that where an earlier panel decision on statutory

construction was based on deference to an agency interpretation, a later panel of this

court is free to consider whether a new agency interpretation is reasonable without en

banc reconsideration of the earlier panel decision. In this circuit, like the Ninth Circuit,

panels of the court are bound by prior panel decisions. Newell Cos. v. Kenney Mfg.

Co., 864 F.2d 757, 765 (Fed. Cir. 1988). Although that rule could be construed to

preclude giving deference to a new agency interpretation even where our prior decision

was based on deference, we think that the better view is that a panel should be free to

consider whether the new interpretation is permissible in keeping with our role as a

03-3286, -3330, -3331 20
reviewing court under the Chevron framework. See Chevron, 467 U.S. at 863-64 (“An

initial agency interpretation is not instantly carved in stone. On the contrary, the

agency, to engage in informed rulemaking, must consider varying interpretations and

the wisdom of its policy on a continuing basis.”). Quoting Chevron, in Rust v. Sullivan,

the Supreme Court said, “This Court has rejected the argument that an agency’s

interpretation ‘is not entitled to deference because it represents a sharp break with prior

interpretations’ of the statute in question.” 500 U.S. 173, 186 (1991) (quoting Chevron,

467 U.S. at 862). Where an agency’s new interpretation is entitled to deference, a

reviewing court should not substitute its judgment for that of the agency unless the

agency’s judgment is unreasonable. Chevron, 467 U.S. at 843-44 (stating that where

Congress has left a gap in a statutory scheme, even implicitly, “a court may not

substitute its own construction of a statutory provision for a reasonable interpretation

made by the administrator of an agency”). Thus, we think the better view, as the Ninth

Circuit held in Mesa Verde, is that a later panel of this court must be free to consider

whether an agency’s new interpretation of a statute that it is charged with administering

is reasonable without being bound by a deferential interpretation applied in a prior panel

decision.

We also agree with the Board that Watson provides some support for this rule in

that this court noted in Watson that its prior decision in Bingaman was deferential.

However, as noted supra, the question was not squarely presented in Watson because

the standard employed in Watson was entirely consistent with the rationale of

Bingaman. Watson, 262 F.3d at 1301-02. Thus, we conclude that the Board was not

03-3286, -3330, -3331 21
bound to interpret section 7521 in the same manner it was interpreted in Sannier and

Stephens.

This leads us next to the question of whether the Board’s new interpretation of

section 7521 is permissible. Chevron, 467 U.S. at 843; Mesa Verde, 861 F.2d at 1130-

31. The Board justified its new interpretation on multiple grounds. Some of the Board’s

proffered justifications for adopting its new standard have been rejected supra, and

there is no need to repeat them here. Because we conclude that the Board’s

interpretation of the plain language of section 7521 is reasonable based on the policy

arguments it has advanced, we will focus on those arguments. The Board, in its Tunik

decision, stated that

if constructive removal means what the Board interpreted it to mean in
Doyle, then an agency would have to first seek the Board’s permission,
with the opportunity for a full evidentiary hearing, every time it wants to
take actions like the ones at issue here, which involve such things as case
processing matters and training requirements.
. . . We cannot believe that this sort of micromanagement, and the
likely slowdown in the agency’s work that it would cause, is what Congress
intended when it used the word “removal” in 5 U.S.C. § 7521. Instead, the
plain language of the statute shows that Congress intended to protect
individuals from losing their positions as ALJs by requiring agencies to
obtain the Board’s permission before separating persons from ALJ
positions. This gives ALJs greater protection than employees covered
under section 7512 because an appeal from a section 7512 action may be
brought only after the action has been taken. The additional protection
afforded by section 7521 sufficiently safeguards the qualified judicial
independence of an ALJ.

Tunik, 93 M.S.P.R. at 492.

We agree with the Board that the plain language of section 7521 reasonably can

be read to apply only to cases of actual separation from employment as an ALJ. As

noted supra, both Sannier and Stephens recognized that the constructive removal

doctrine went beyond the plain language of the statute. If anything, the more natural

03-3286, -3330, -3331 22
reading of section 7521 would preclude the constructive removal doctrine entirely. The

Board’s earlier contrary opinion in Doyle relied in part on the Court of Claims’ decision in

Benton v. United States, 488 F.2d 1017 (Ct. Cl. 1973). Doyle, 29 M.S.P.R. at 174-75.

In Benton, the Court of Claims held that subjecting a hearing examiner to involuntary

retirement under the Civil Service Retirement Act constituted removal under section 11

of the APA. In its analysis, the court said, “We reach our conclusion in recognition of

the fact that the APA was a sweeping piece of remedial legislation which was a long

time in coming. For that reason, we think it should be given a broad and generous

interpretation in light of the objectives sought to be accomplished.” 488 F.2d at 1022.

Benton, however, recognized that “removal” relates to an actual separation from

employment and merely extended such removals to circumstances in which the reason

for such separation was not disciplinary in nature. Id. at 1020-21. Similarly, this court’s

decision in Sannier cited Schultz v. United States Navy, 810 F.2d 1133 (Fed. Cir. 1987),

as supporting a broad understanding of removal. However, Schultz held only that a

voluntary resignation based on agency coercion constituted an adverse action. Id. at

1137. Thus, no decision of this court has construed section 7521 to cover anything

other than actual separation from employment as an ALJ, except in the deferential

context of Sannier and Stephens.

The ALJs argue that the APA was designed to secure decisional independence

of administrative judges. Similarly, the ALJs argue that the legislative history of the APA

indicates the importance of decisional independence to Congress. Although the ALJs

are correct that the APA was concerned with effecting independence for ALJs, neither

the APA itself nor the legislative history behind it indicates that Congress intended to

03-3286, -3330, -3331 23
extend section 7521 to cover anything less than actual separation from employment as

an ALJ. There were some who expressed such views. However, the history of the APA

does not show that those views reflected the intent of Congress in enacting the APA.

See Ramspeck v. Fed. Trial Exam’rs Conference, 345 U.S. 128, 131-33 (1953) (“The

position of hearing examiners is not a constitutionally protected position. It is a creature

of congressional enactment. . . . They hold their posts by such tenure as Congress sees

fit to give them.”); see also S. Rep. No. 79-752, at 30 (1945) (“On those subjects, such

as the separation of examiners from the agencies they serve, there has been a wide

divergence of views. The committee has in such cases taken the course which it

believes will suffice without being excessive.”). We cannot agree with the ALJs that the

term “removal” in section 7521 must be construed to encompass constructive removal.

The ALJs additionally argue that in view of 5 U.S.C. § 3105, section 7521 must

be construed broadly to include constructive removal. Section 3105 provides that

“[a]dministrative law judges . . . may not perform duties inconsistent with their duties and

responsibilities as administrative law judges.” 5 U.S.C. § 3105 (2000). Based on

section 3105, the ALJs argue that “removal” in section 7521 must include anything that

causes ALJs to perform duties that are inconsistent with their duties and responsibilities

as ALJs. In particular, the ALJs argue that interference with their decisional

independence causes them to perform their duties in an unfair manner, which is

inconsistent with their duties as ALJs. It is unclear, however, how an agency’s

interference with an ALJ’s decisional independence causes an ALJ to perform a duty

that is inconsistent with the ALJ’s duties and responsibilities as an ALJ. The ALJs are

not arguing that they are being required to perform duties other than the adjudication of

03-3286, -3330, -3331 24
cases. Instead, they are complaining about the manner of performance of that duty.

Section 3105 does not speak to this issue. Even if the ALJs were correct, there is no

plausible reason to engraft such a contorted interpretation of section 3105 onto section

7521. We thus conclude that the Board’s interpretation of section 7521 to require actual

physical separation from employment as an ALJ is not unreasonable.

The remaining arguments of the ALJs have been considered but are not

persuasive. We thus conclude that the Board’s new interpretation of section 7521 is

reasonable and that our decisions in Sannier and Stephens do not preclude the Board

from adopting such a new interpretation.

3. Overturning the Regulation

Our holding that the Board’s new interpretation of section 7521 is permissible

does not end the inquiry. The Board has promulgated a regulation, 5 C.F.R.

§ 1201.142, codifying the holding of Doyle. The regulation states, “An administrative

law judge who alleges that an agency has interfered with the judge’s qualified decisional

independence so as to constitute an unauthorized action under 5 U.S.C. 7521 may file a

complaint with the Board under this subpart.” 5 C.F.R. § 1201.142 (2004). The Board

recognized the inconsistency between the extant regulation and its desire to overrule

Doyle. In dealing with the regulation, the Board said:

The Board’s regulation at 5 C.F.R. § 1201.142 conforms to the
Doyle theory of jurisdiction. That regulation states that an ALJ may file a
complaint with the Board if he alleges that “an agency has interfered with
[his] qualified decisional independence so as to constitute an unauthorized
action under 5 U.S.C. § 7521.” The fact that a regulation is based on an
erroneous interpretation of a statute does not prevent us from overruling
the case law on which the regulation is based. Rather, the statute takes
precedence over the regulation. We therefore will overrule Doyle and
change our regulations later to conform to the statute and the new
precedent.

03-3286, -3330, -3331 25
Tunik v. Social Sec. Admin., 93 M.S.P.R. 482, 492 (2003) (citation omitted and

alteration in original). Because the Board overturned its regulation through adjudication,

we asked for additional briefing as to whether the holding of American Federation of

Government Employees, AFL-CIO, Local 3090 v. Federal Labor Relations Authority,

777 F.2d 751, 758-60 (D.C. Cir. 1985), might preclude the Board’s decision in this case.

The ALJs, the government, and the Social Security Administration submitted

supplemental briefs on this issue.

We conclude that the Board misunderstood its role as an administrative agency

and failed to consider the question of whether and under what circumstances the Board,

by adjudication, could overturn its regulation. If the Board’s regulation is subject to the

requirements of 5 U.S.C. § 553, requiring notice and comment rulemaking, the Board’s

regulation is the governing law and may not be overturned by the Board outside the

procedural requirements of section 553. United States v. Nixon, 418 U.S. 683, 695-96

(1974) (“So long as this regulation remains in force the Executive Branch is bound by it,

and indeed the United States as the sovereign composed of the three branches is

bound to respect and to enforce it.”). To determine whether the Board improperly

overruled its regulation, we must determine whether the regulation is subject to section

553.

Section 553(b) requires notice of proposed “rule making” to be published in the

Federal Register. 5 U.S.C. § 553(b) (2000). Section 553(c) requires the agency

attempting to promulgate the relevant rule to allow interested persons to participate in

the process by providing comments on the proposed rules. Id. § 553(c). Section 551(5)

expressly defines “rule making” as the “agency process for formulating, amending, or

03-3286, -3330, -3331 26
repealing a rule.” Id. § 551(5) (emphasis added). Thus, to the extent that promulgation

of 5 C.F.R. § 1201.142 was subject to the requirements of section 553, the repeal of

that regulation is also subject to section 553.

Section 553 has numerous exceptions, however, two of which are relevant here.

First, section 553(a)(2) excludes “a matter relating to agency management or

personnel.” Second, section 553(b)(A) excludes “interpretive rules, general statements

of policy, or rules of agency organization, procedure, or practice” from the requirements

of section 553. If either of these exceptions applies, the Board’s rule is not subject to

section 553, and the Board is free to repeal that rule without engaging in formal

rulemaking as prescribed by section 553. On the other hand, if neither exception

applies, then the Board’s rulemaking was governed by section 553 and was subject to

the requirements of notice and comment.

The first exception excludes matters relating to agency management or

personnel. That provision was in the original APA in essentially the same terms as

appear today. Administrative Procedure Act, Pub. L. No. 79-404, § 4, 60 Stat. 237, 238

(1946) (“Except to the extent that there is involved . . . (2) any matter relating to agency

management or personnel . . . .”). Although the legislative history of this provision is

sparse, the Attorney General provided a contemporaneous interpretation of the

provision in the Attorney General’s Manual on the Administrative Procedure Act

published in 1947. Because of the extensive involvement of the Attorney General in the

drafting and enactment of the APA, the Attorney General’s contemporaneous

interpretation of the provision is entitled to some weight. Chrysler Corp. v. Brown, 441

U.S. 281, 302 (1979) (“In prior cases, we have given some weight to the Attorney

03-3286, -3330, -3331 27
General’s Manual on the Administrative Procedure Act (1947), since the Justice

Department was heavily involved in the legislative process that resulted in the Act’s

enactment in 1946.”). Regarding the agency management or personnel exception, the

Attorney General said, “The exemption for matters relating to ‘agency management or

personnel’ is self-explanatory and has been considered in the discussion of ‘internal

management’ under section 3.” Attorney General’s Manual on the Administrative

Procedure Act 27 (1947) (“Attorney General’s Manual”). The exemption in section 3 of

the APA was for “any matter relating solely to the internal management of an agency.”

Administrative Procedure Act, Pub. L. No. 79-404, § 3, 60 Stat. 237, 238 (1946). With

respect to that exemption, the Attorney General said,

If a matter is solely the concern of the agency proper, and therefore does
not affect the members of the public to any extent, there is no requirement
for publication under section 3. Thus, an agency’s internal personnel and
budget procedures need not be published (e.g., rules as to leaves of
absence, vacation, travel, etc.). However, in case of doubt as to whether
a matter is or is not one of internal management, it is suggested that the
matter be published in the Federal Register, assuming it does not require
secrecy in the public interest.

Attorney General’s Manual 18. Although the provision in section 3 is worded differently

from section 4, the Attorney General was of the opinion that the agency management or

personnel exception was essentially of the same scope. The Senate Report seemed to

take a similar view stating, “The exception of matters of management or personnel

would operate only so far as not inconsistent with other provisions of the bill relating to

internal management or personnel.” S. Rep. No. 79-752, at 13 (1945). Few courts

have had the opportunity to interpret this provision.

In Seaboard World Airlines, Inc. v. Gronouski, 230 F. Supp. 44 (D.D.C. 1964),

the plaintiff challenged a new postal regulation requiring mail to be sent by the most

03-3286, -3330, -3331 28
expedient air service without regard to the type of aircraft used. The new regulation

significantly reduced the plaintiff’s business in carrying mail for the U.S. Postal Service.

In replying to the plaintiff’s argument that the rule was required to be promulgated in

accordance with notice and comment rulemaking, the government argued that the

regulation only provided directions to agency personnel as to how to ship mail and thus

was within the agency management or personnel exception. The district court

disagreed, stating that “the policy involved here, although it is directed to the Post Office

personnel, substantially affects outside parties and is therefore NOT subject to the

exception.” Id. at 46. The District of Columbia Circuit rejected a similar argument in

Joseph v. United States Civil Service Commission, 554 F.2d 1140, 1153 n.23 (D.C. Cir.

1977). In Joseph, the court considered the applicability of the agency management or

personnel exception to a Civil Service Commission regulation exempting from the Hatch

Act participation in political campaigns as, or on behalf of, an independent candidate in

a partisan election for local office in the District of Columbia. Relying on Seaboard, the

court said, “Section 553(a)(2) must be narrowly construed, and although the

Commission’s regulation is only directed at government personnel it does not fall within

section 553(a)(2) because outside individuals are substantially affected.” Id. (citation

omitted).

The D.C. Circuit again considered the scope of the agency management or

personnel exception in Stewart v. Smith, 673 F.2d 485 (D.C. Cir. 1982). Stewart

involved a challenge to the Bureau of Prisons’ policy of not considering for employment

any person who is over 34 years of age. Id. at 487. The D.C. Circuit held, over a

vigorous dissent, that the hiring policy was not subject to section 553 because it fell

03-3286, -3330, -3331 29
within the exception for agency management or personnel. Id. at 496-500. The

majority read the exception in section 3 of the APA as being a narrower exception than

the agency management or personnel exception in section 4 based on the plain

language of the two provisions. The dissent, on the other hand, read the two provisions

as being co-extensive based on the legislative history and prior cases. Id. at 502

(Wright, J., dissenting).

This court has twice considered the applicability of the agency management or

personnel exception to section 553. Favreau v. United States, 317 F.3d 1346, 1359

(Fed. Cir. 2002) (holding that memoranda detailing when the United States could seek

recoupment of prepaid bonuses from armed forces personnel were subject to the

agency management or personnel exception of section 553); Hamlet v. United States,

63 F.3d 1097, 1105 (Fed. Cir. 1995) (holding that the Agricultural Stabilization and

Conservation Service personnel management handbook “relates to matters of agency

personnel, [and thus] its promulgation was exempt from the strict procedural

requirements found in the APA”). Because the facts in these two cases bear little

resemblance to the facts of the case before us, we will focus on the more pertinent

cases from the D.C. Circuit.

Although we need not decide whether the section 4 exception carries the same

scope as the section 3 exception, we conclude that the exception in section 4 cannot be

construed to exempt the regulation at issue from notice and comment rulemaking.

Although removal of ALJs could be characterized in a sense as a personnel matter in

the same manner as the hiring policy at issue in Stewart, the removal of ALJs goes to

the heart of the APA and implicates a much broader class of the public than those who

03-3286, -3330, -3331 30
might apply for employment with the Bureau of Prisons. Indeed, the removal of ALJs

implicates not only the rights of an individual ALJ being removed, but also the broader

interest of the public in having private rights adjudicated by persons who have some

independence from the agency opposing them. In that sense, section 7521 is primarily

for the public benefit and only secondarily for the benefit of a particular ALJ in a

particular case. See Stewart, 673 F.2d at 505 (Wright, J., dissenting) (“In the narrow set

of cases where a proposed rule substantially affects parties outside an agency and

implicates broad public concerns, the personnel exemption from rulemaking

requirements surely does not apply.”). Thus, section 7521 is unlike the hiring policy at

issue in Stewart, which was primarily for the internal benefit of the Bureau of Prisons,

although secondarily impacting eligibility of applicants for employment. Indeed, a

substantial justification for the APA, as noted supra, was the need for greater

independence of those adjudicating private rights. Given the importance of the

independence of ALJs to the framework of the APA, it would be unreasonable to

conclude that regulations promulgated pursuant to section 7521, which is a cornerstone

of decisional independence for ALJs, were of so little concern to the public at large that

they should not be subject to notice and comment rulemaking. See S. Rep. No. 79-752,

at 30 (1945) (“[T]here are certain provisions which touch on subjects long regarded as

of the highest importance . . . such as the separation of examiners from the agencies

they serve . . . .”). The public would seem to have at least as much interest in the

subject as it has in whether federal employees may participate in partisan elections.

Moreover, exceptions to the notice and comment requirements of the APA should be

narrowly construed. Joseph, 554 F.2d at 1153 n.23 (“Section 553(a)(2) must be

03-3286, -3330, -3331 31
narrowly construed . . . .”); see also Alcaraz v. Block, 746 F.2d 593, 612 (9th Cir. 1984)

(“The exceptions to section 553 will be narrowly construed and only reluctantly

countenanced.” (quotation marks and citation omitted)). Thus, the regulation at issue

cannot be exempted from notice and comment rulemaking as merely relating to agency

personnel.

Next, we must consider whether the exemption in section 553(b)(A) excluding

“interpretive rules, general statements of policy, or rules of agency organization,

procedure, or practice” from the requirements of section 553 applies to section

1201.142. In Chrysler Corp. v. Brown, the Supreme Court described a substantive, or

legislative, rule—as opposed to an interpretive rule—as “one ‘affecting individual rights

and obligations.’” 441 U.S. 281, 302 (1979) (quoting Morton v. Ruiz, 415 U.S. 199, 232

(1974)). The Supreme Court went on to say that “[t]his characteristic is an important

touchstone for distinguishing those rules that may be ‘binding’ or have the ‘force of

law.’” Id. In Hamlet v. United States, 63 F.3d 1097, 1105 n.6 (Fed. Cir. 1995), this court

said that “procedural requisites in manuals or handbooks for the removal of an agency

employee, such as the procedural requirements held to be binding in Service v. Dulles,”

were substantive rules. This court then held that the regulation at issue was substantive

because “it purports to create a reinstated employee’s right to receive backpay.” Id. at

1106. Similarly, the requirements that the Supreme Court held to be binding in Service

v. Dulles, 354 U.S. 363, 373-75 (1957), related to the Secretary of State’s ability to

remove an employee due to the Secretary’s concern that the employee posed a loyalty

or security risk. Thus, section 1201.142, granting an ALJ a right to bring an action

03-3286, -3330, -3331 32
before the Board for constructive removal, certainly affects individual rights and would

seem to be at least as much a substantive rule as those in the above cases.

The Board, however, argues that it promulgated section 1201.142 under the

authority of 5 U.S.C. § 1204(h), providing authority for the Board “to prescribe such

regulations as may be necessary for the performance of its functions,” and that to the

extent that the regulation describes the Board’s jurisdiction over constructive removals,

it can be no more than an interpretive rule. The Board argues that it lacks delegated

authority to promulgate legislative rules determining the scope of its jurisdiction. The

Board’s position on this issue lacks any merit. When published for notice and comment,

the notice of proposed rulemaking including section 1201.142 referred to 5 U.S.C.

§§ 1204 and 7701 as authority for the regulation. 62 Fed. Reg. 48449, 48451 (Sept. 16,

1997). The Board’s assertion that the notice only referred to section 1204(h) is clearly

incorrect. We need not decide the extent of the Board’s authority to promulgate

regulations governing its jurisdiction under section 7701, because 5 U.S.C. § 1305

states that “for the purpose of section 7521 of this title, the Merit Systems Protection

Board may . . . prescribe regulations . . . .” To the extent there is doubt that the Board

has jurisdiction to prescribe regulations governing its jurisdiction under section 7701,

section 1305 expressly provides the Board with authority to prescribe regulations

governing the provisions of section 7521, which is precisely what section 1201.142

does. While section 1305 was not expressly listed in the statutory authority for the

promulgation of section 1201.142, this lack of notice was not prejudicial. See Trans-

Pacific Freight Conference of Japan/Korea v. Fed. Mar. Comm’n, 650 F.2d 1235, 1259

(D.C. Cir. 1980) (“Although the Commission technically was not in compliance with

03-3286, -3330, -3331 33
section 4(b)(2), we believe that the defect in the notice of proposed rulemaking was not

fatal.”).

Because section 1201.142 is a substantive rule not subject to the exemption in

section 553(b)(A) and because it is not subject to the agency management or personnel

exception of section 553(a)(2), the Board could only repeal the rule through the notice

and comment procedures required by section 553(b). United States v. Nixon, 418 U.S.

683, 695-96 (1974) (“So long as this regulation remains in force the Executive Branch is

bound by it, and indeed the United States as the sovereign composed of the three

branches is bound to respect and to enforce it.”); Am. Fed’n of Gov’t Employees, AFL-

CIO, Local 3090 v. Fed. Labor Relations Auth., 777 F.2d 751, 758-60 (D.C. Cir. 1985)

(“[U]nless and until it amends or repeals a valid legislative rule or regulation, an agency

is bound by such a rule or regulation.”); see also United States ex rel. Accardi v.

Shaughnessy, 347 U.S. 260, 267-68 (1954) (holding that the Attorney General may not

act in contravention of valid regulations “as long as the regulations remain operative”).

The Board and the Agency argue that an exception to the general rule that an

Agency is bound by its own rules applies where the rule is inconsistent with a statute.

See Am. Tel. & Tel. Co. v. Fed. Communications Comm’n, 978 F.2d 727, 733 (D.C. Cir.

1992) (“[T]hen Judge Scalia, concurring in American Federation of Government

Employees, recognized that in some situations, when an agency declines to apply its

own rule in an adjudication ‘we would be justified [on appeal] in looking beyond the

defect of inconsistency, to affirm an adjudication on the ground that its result was

mandated by statute and that the conflicting rule was simply unlawful.’” (quoting Am.

Fed. of Gov’t Employees, 777 F.2d at 760 (Scalia, J., concurring)) (alteration in

03-3286, -3330, -3331 34
original)). However, the argument that section 1201.142 is inconsistent with section

7521 is foreclosed by our decisions in Sannier and Stephens. Thus, this exception does

not apply.

Based on the foregoing, we must conclude that the Board lacked authority to

overrule section 1201.142 by adjudication. That conclusion does not foreclose the

Board from repealing the rule in accordance with section 553(b). However, for

purposes of the present case, the Board must adhere to its legislative rule.

III. CONCLUSION

Because Tunik’s appeal is moot and was moot before the Board, we vacate the

Board’s opinion in his case and remand with instructions to dismiss the appeal.

Because the Board violated the APA in attempting to overturn its regulation through

adjudication in the remaining cases, we reverse the Board’s dismissals in those cases

and remand for further proceedings consistent with this opinion.

REVERSED-IN-PART, VACATED-IN-PART, AND REMANDED

03-3286, -3330, -3331 35
 United States Court of Appeals for the Federal Circuit

03-3286, -3330, -3331

LLOYD L. TUNIK,

Petitioner,

and

VERRELL DETHLOFF, THOMAS S. ROBINSON, MARGUERITE
SCHELLENTRAGER, KAREN BAKER, BRYAN BERNSTEIN, and
TELA L. GATEWOOD

Petitioners,

and

JOSEPH SCHLOSS,

Petitioner,

v.

MERIT SYSTEMS PROTECTION BOARD,

Respondent,

and

SOCIAL SECURITY ADMINISTRATION,

Intervenor.

SCHALL, Circuit Judge, dissenting.

The court’s opinion represents a thorough analysis of the issues in this case.

However, I am unable to agree with the majority that the Merit Systems Protection

Board (“Board”) may not, by adjudication, overrule In re Doyle, 29 M.S.P.R. 170 (1985),
and declare invalid 5 C.F.R. § 1201.142, the regulation embodying the holding of Doyle.

As explained below, in my view Doyle and the attendant regulation are contrary to 5

U.S.C. § 7521 (2000). For that reason, assuming the exceptions of 5 U.S.C. § 553 do

not apply, I still do not think that we should reverse the decision of the Board on the

ground that the Board failed to go through an Administrative Procedure Act (“APA”)

notice-and-comment rule-making process to formally repeal the regulation. Accordingly,

I would affirm the decision of the Board. I therefore respectfully dissent.

I.

In accordance with 5 U.S.C. § 7521, an agency may take certain “actions”

against an administrative law judge (“ALJ”) “only for good cause established and

determined by the [Board] on the record after opportunity for hearing before the Board.”

5 U.S.C. § 7521(a). The statute goes on to state:

The actions covered by this section are—
(1) a removal;
(2) a suspension;
(3) a reduction in grade;
(4) a reduction in pay; and
(5) a furlough of 30 days or less[.]

Id. § 7521(b). In short, under the statute, an employing agency may not remove an

ALJ, suspend an ALJ, reduce an ALJ’s grade, reduce an ALJ’s pay, or put an ALJ on a

furlough of 30 days or less, without first establishing before the Board good cause for

the action.

In Doyle, the Board addressed the issue of whether it had jurisdiction over a

claim of constructive removal under section 7521 even though the statute refers simply

to “removal.” The case arose from, among other things, Judge Doyle’s allegation that

his employing agency, the Department of Health and Human Services (“HHS”),

03-3286, -3330, -3331 2
constructively removed him from his position as an ALJ when it refused to approve his

$350 travel voucher. Doyle, 29 M.S.P.R. at 171-72. The Board noted that while

“constructive removal” was not one of the actions expressly covered by section 7521,

“removal” had consistently been interpreted so as to protect ALJs from agency actions

that might impair the ALJ’s “qualified judicial independence.” Id. at 174. More

particularly, the Board viewed our predecessor court’s decision in Benton v. United

States, 488 F.2d 1017 (Cl. Ct. 1973), as support for the proposition that section 7521

applies to both direct and indirect actions that undermine an ALJ’s qualified judicial

independence:

Consistent with the court’s position in Benton, the Board also
recognizes the possibility of an agency’s constructively
removing an administrative law judge by cumulative
administrative actions or active intervention in a manner
calculated to prevent the impartial exercise of his judicial
functions. . . . Whether the Board takes jurisdiction over an
action as a “constructive removal” within section 7521
depends on the sufficiency of the allegations in showing that
the challenged action has a pernicious effect on the
complaining judge’s qualified independence.

Doyle, 29 M.S.P.R. at 175. Under this standard, the Board ultimately concluded that

Judge Doyle, who remained employed as an ALJ with HHS, had not presented

allegations sufficient to invoke the Board’s jurisdiction. It therefore dismissed his

complaint. Id.

II.

Until its decision in Tunik v. Social Security Administration, 93 M.S.P.R. 482

(2003), the Board continued to apply the Doyle standard to constructive removal claims

brought under 5 U.S.C. § 7521. See, e.g., White v. Soc. Sec. Admin., 76 M.S.P.R. 447,

453 n.3 (1997); Bennett v. Soc. Sec. Admin., 72 M.S.P.R. 116, 119-20 (1996); Lawson

03-3286, -3330, -3331 3
v. Dep’t of Health & Human Servs., 64 M.S.P.R. 673, 678 (1994). In addition, the Board

promulgated a regulation, 5 C.F.R. § 1201.142, embodying the holding in Doyle. The

regulation provides:

An [ALJ] who alleges that an agency has interfered with the
judge’s qualified decisional independence so as to constitute
an unauthorized action under 5 U.S.C. [§] 7521 may file a
complaint with the Board under this subpart.

5 C.F.R. § 1201.142 (2003).

In Tunik, the Board reconsidered the issue and concluded that its holding in

Doyle was inconsistent with section 7521. In particular, the Board concluded that

section 7521 conferred jurisdiction over constructive removal claims only if the ALJ first

showed actual separation from his ALJ position with the agency. Tunik, 93 M.S.P.R. at

493. Separation, the Board held, could be established by showing that the agency

separated or reassigned the ALJ from his position as an ALJ or by showing that the

decision of the ALJ to leave his position was involuntary. Id. The Board determined

that, under this standard, it lacked jurisdiction over Judge Tunik’s constructive removal

claim because he remained in his position as an ALJ with the Social Security

Administration (“SSA”). Id.

The Board recognized that its decision required overturning Doyle and

invalidating 5 C.F.R. § 1201.142, but it concluded that such action was justified because

Doyle was not consistent with 5 U.S.C. § 7521. In reaching this conclusion, the Board

first noted that Congress used almost identical language in listing covered actions under

5 U.S.C. § 7521 and 5 U.S.C. § 7512 (2000).1 Tunik, 93 M.S.P.R. at 486. In that

1
Section 7512 of title 5 lists the actions that an “employee” of an agency
may appeal to the Board. It states that the covered actions are:

03-3286, -3330, -3331 4
regard, the Board pointed out that in Butler v. Social Security Administration, 331 F.3d

1368 (Fed. Cir. 2003), this court held that “section 7521 must be construed consistently

with its sister provision, section 7512,” which has been interpreted to require actual

separation. Tunik, 93 M.S.P.R. at 486-87 (quoting Butler, 331 F.3d at 1372). The

Board stated that its conclusion was also consistent with the ordinary meaning of

“removal”—“to be separated from one’s position of record or not to have a continuing

appointment to that position.” Id. at 487.

The Board also determined that Doyle’s reliance on Benton v. United States, 488

F.2d 1017 (Ct. Cl. 1973), was misplaced. That was because, the Board said, Benton

did not involve a situation where the ALJ filed a constructive removal claim yet retained

his position as an ALJ. Rather, the case involved a constructive removal claim based

on an allegation of involuntary retirement, an allegation over which the Board would also

have jurisdiction under section 7512 (if brought by a qualifying “employee”). Tunik, 93

M.S.P.R. at 488. The Board further determined that the legislative history discussed in

Benton, relating to section 11 of the APA, indicated that Congress intended “removal” to

mean “separation.” Id. at 489.2 Further, the Board noted that Benton also relied on a

(Cont’d. . . .)
(1) a removal;
(2) a suspension for more than 14 days;
(3) a reduction in grade;
(4) a reduction in pay; and
(5) a furlough of 30 days or less[.]
5 U.S.C. § 7512.
2
Specifically, the legislative history cited in Benton states that section 11 of
the APA was intended to make hearing examiners “‘removable only for good cause
determined by the Civil Service Commission [CSC], after opportunity for a hearing,’ and
that the CSC must ‘afford any examiner an opportunity for a hearing before acceding to
an agency request for removal.’” Tunik, 93 M.S.P.R. at 489 (quoting Benton, 488 F.2d
at 1021-22) (emphases added).

03-3286, -3330, -3331 5
CSC regulation which defined “removal” as “an involuntary change in the status of an

[ALJ], including discharge, demotion, and suspension from the position of [ALJ] and

demotion, reassignment, and promotion, to a position other than that of [ALJ].” Id.

(quoting 5 C.F.R. § 930.202(f) (1973)). In short, the Board determined that the Benton

decision was really concerned about the procedures that must be followed before

separating an individual from his or her position as an ALJ. Id. Accordingly, the Board

held that its decision in Doyle “went beyond the Benton decision, the legislative history

[of the APA], and the CSC regulations to create a class of appealable ‘removal’ actions

which have nothing to do with being separated from the position of ALJ.” Id.

The Board also determined that Doyle was inconsistent with 5 C.F.R.

§ 930.202(f) (2003), a regulation of the Office of Personnel Management (“OPM”)

implementing section 7521. The regulation defines “removal” as the “discharge of an

[ALJ] from the position of [ALJ] or involuntary reassignment, demotion, or promotion to a

position other than that of [ALJ].” 5 C.F.R. § 930.202(f). Therefore, the Board

concluded, “[i]f we continue to adhere to the Doyle theory of constructive removal, we

would effectively be invalidating the OPM regulations which implemented section 7521.”

Id.

Finally, the Board concluded that our decision in Sannier v. Merit Systems

Protection Board, 931 F.2d 856 (Fed. Cir. 1991), was not a bar to its decision to

overrule Doyle. First, the Board stated that it was free to address issues involving its

own jurisdiction. Tunik, 93 M.S.P.R. at 490. Second, the Board noted that, in

recognizing the existence of constructive removal claims, Sannier relied on Schultz v.

United States Navy, 810 F.2d 1133, 1136 (Fed. Cir. 1987), a case involving a claim of

03-3286, -3330, -3331 6
involuntary resignation under section 7512. Tunik, 93 M.S.P.R. at 491. This, the Board

stated, indicated that constructive removal claims involving ALJs require actual

separation. Id. Third, the Board determined that in Sannier we merely “recognized” the

Doyle theory of jurisdiction over constructive removal claims. Id. We did not, according

to the Board, “necessarily endorse” the concept created in Doyle. Id. The Board

concluded that, under such circumstances, our decision in Watson v. Department of the

Navy, 262 F.3d 1292 (Fed. Cir. 2001), allowed it to reconsider and overrule its earlier

decision and to invalidate the regulation. Tunik, 93 M.S.P.R. at 491-92.

III.

The majority holds that, under Chevron U.S.A. Inc. v. Natural Resources Defense

Council, Inc., 467 U.S. 837 (1984), the Board’s interpretation of “removal” to require

actual separation is consistent with 5 U.S.C. § 7521 because the statute is ambiguous

and the Board’s interpretation is reasonable.3 The majority states that our decisions in

Sannier and in Stephens v. Merit Systems Protection Board, 986 F.2d 493 (Fed. Cir.

1993), ordinarily would not bar the Board from overruling its prior interpretation because

those two cases were decided based on Chevron deference to the Board’s decision in

Doyle. In this case, however, the majority holds that the process for overturning Doyle,

which the majority states represented a reasonable interpretation of the statute, supra at

18, is complicated by the Board’s regulation codifying Doyle at 5 C.F.R. § 1201.142.

Specifically, the majority states, and I agree, that the APA does not generally permit an

agency to repeal a regulation without following the Act’s notice-and-comment process.

3
As indicated in Part IV below, it is my view that the language of section
7521 is clear.

03-3286, -3330, -3331 7
 The majority, I think, acknowledges, and I agree, that there are situations in

which an agency’s action invalidating a regulation it determines is contrary to statute,

without notice and comment, will be excused. See supra Part II.B.3, citing Am. Tel. &

Tel. Co. v. Fed. Communications Comm’n, 978 F.2d 727, 733 (D.C. Cir. 1992).

However, the majority concludes that that proposition does not apply in this case

because our intervening decisions in Sannier and Stephens recognized the Doyle

theory, and therefore 5 C.F.R. § 1201.142, as a reasonable interpretation of section

7521. Thus, the majority concludes, the Board’s decision invalidating 5 C.F.R.

§ 1201.142 without following the notice-and-comment process of the APA must be

reversed. It is this aspect of the majority opinion with which I disagree.

IV.

I start from the premise that an agency may not promulgate a regulation that is

contrary to statute. See United States v. Mead Corp., 533 U.S. 228, 227 (2001);

Chevron, 476 U.S. at 842-45. And, in this case, I think the Board correctly determined

that 5 C.F.R. § 1201.142 is contrary to the plain language of 5 U.S.C. § 7521.

Additionally, I do not think this court ever determined that Doyle was a reasonable

interpretation of section 7521. Therefore, I am unable to agree with the majority that the

Board’s failure to issue notice and comment before overruling Doyle and invalidating 5

C.F.R. § 1201.142 requires reversal.

Turning first to the language of the statute, I think the ordinary meaning of

“removal” entails “separation” from one’s current position of employment. Benton, 488

F.2d at 1020 (“In the ordinary sense, the word ‘removal’ denotes an involuntary

separation of the employee from his position.”); Black’s Law Dictionary 1322 (8th ed.

03-3286, -3330, -3331 8
2004) (“The transfer or moving of a person or thing from one location, position, or

residence to another.”). In addition, Congress chose to define covered actions under 5

U.S.C. § 7521 with language almost identical to that used in 5 U.S.C. § 7512, which

pertains to action taken against certain federal “employees”:

This subchapter applies to—
(1) a removal;
(2) a suspension for more than 14 days;
(3) a reduction in grade;
(4) a reduction in pay; and
(5) a furlough of 30 days or less[.]

Consequently, we have held that the similarity of the two statutes dictates that they be

construed in the same manner. Butler, 331 F.3d at 1372 (“We conclude that section

7521 must be construed consistently with its sister provision, section 7512.”).

Moreover, while we have recognized constructive removal claims under section 7512,

we, and the Board, have only done so where the employee shows actual separation

from the agency. See, e.g., Shoaf v. Dep’t of Agric., 260 F.3d 1336, 1341 (Fed. Cir.

2001) (“The [Board] possesses jurisdiction over an appeal filed by an employee who

has resigned or retired if the employee proves, by a preponderance of the evidence,

that his or her resignation or retirement was involuntary and thus tantamount to forced

removal. That is, an involuntary resignation constitutes a constructive removal that is

appealable to the [Board].” (citation omitted)); Gutierrez v. United States Postal Serv.,

90 M.S.P.R. 604, 607 (2002) (“An employee-initiated action such as a resignation or a

retirement is not appealable to the Board unless the appellant proves that it was

involuntary and thus constituted a constructive removal.”). Accordingly, I think Doyle

03-3286, -3330, -3331 9
was wrong in suggesting that the Board could have jurisdiction over constructive

removal claims where the ALJ was not separated from the agency.4

I think the Board’s principal error in Doyle was its misplaced reliance on Benton.

The Board initially cited Benton as support for the proposition that, although not

expressly recognized in 5 U.S.C. § 7521, the Board has jurisdiction over constructive

removal claims. Doyle, 29 M.S.P.R. at 174. I agree with this statement of the law. See

Benton, 488 F.2d at 1022. However, the Board subsequently proceeded to create a

new standard for establishing a constructive removal claim, a standard that did not

require removal. The Board further stated that this new standard was “[c]onsistent with

the court’s position in Benton.” This, I submit, is simply not correct.

That is because Benton involved a claim of constructive removal based on an

allegation of involuntary retirement, i.e., the employee was no longer with the agency.

Benton, 488 F.2d at 1019 (stating that the issue before the court was “whether Section

11 of the APA, which requires a hearing[,] as prescribed in that Act[,] for the removal of

a Federal hearing examiner, applies to the [CSC’s] involuntary removal and retirement

of a hearing examiner on a disability annuity under the Civil Service Retirement Act”

(footnote and citation omitted)). Furthermore, although recognizing that the CSC had

jurisdiction over constructive removal claims, the Court of Claims never suggested that

a constructive removal could occur without a showing of actual separation from the

agency. On the contrary, the court stated that “[i]n the ordinary sense, the word

‘removed’ denotes an involuntary separation of the employee from his position.” Id. at

1020 (emphases added).

4
I say “suggesting” because, in Doyle, the Board ultimately concluded that
the ALJ had not alleged a constructive removal claim.

03-3286, -3330, -3331 10
 The legislative history of section 11 of the APA, on which the Benton court relied,

shows that Congress intended to give hearing examiners (now known as ALJs)

protections beyond those afforded other employees. That objective, however, was met

by the good cause requirement. Nothing indicates that Congress intended “removal” to

mean anything other than “separation.” Indeed, the legislative history states that the

CSC “must afford any examiner an opportunity for a hearing before acceding to an

agency request for removal . . . .” S. Doc. No. 248, 79th Cong., 2d Sess. 215 (1946)

(emphasis added); see also Benton, 488 F.2d at 1022.

Prudential considerations also favor interpreting “removal” as requiring actual

separation from the ALJ position. Otherwise, the employing agency may be hesitant to

undertake many day-to-day managerial activities without first obtaining clearance from

the Board through the good-cause procedure set forth at 5 U.S.C. § 7521(a). For

example, in this case Judge Tunik alleged constructive removal based on various

memoranda circulated between Chief Administrative Law Judges at the SSA. Tunik, 93

M.S.P.R. at 484. One of these memoranda related to a requirement that Judge Tunik

receive case-processing training. Id. The majority’s recognition of Doyle as a

reasonable, and, for the time being, binding, interpretation of section 7521 may make

agencies reluctant to circulate such standard memoranda without first establishing good

cause before the Board (and after providing the affected ALJ with an opportunity for a

hearing). I find it difficult to believe that Congress had such a cumbersome scheme in

mind when it enacted 5 U.S.C. § 7521.

In sum, I think Doyle gave an impermissible meaning to “removal” and to our

predecessor court’s decision in Benton. The plain meaning of “removal” requires

03-3286, -3330, -3331 11
separation. I thus think the Board correctly determined in Tunik that it lacked jurisdiction

in this case. Therefore, the Board’s failure to go through a notice-and-comment process

before invalidating 5 C.F.R. § 1201.142 does not require reversal of the Board’s

decision. See Am. Tel. & Tel. Co., 978 F.2d at 733 (“We have never held . . . that an

agency is obliged to apply a rule in an adjudicatory context if intervening events indicate

that the rule is unlawful.”); see also Am. Fed’n of Gov’t Employees v. Fed. Labor

Relations Auth., 777 F.2d 751, 760 (D.C. Cir. 1985) (Scalia, J., concurring) (“Perhaps

there are situations in which we would be justified in looking beyond the defect of

inconsistency [with the APA’s notice-and-comment procedure], to affirm an adjudication

on the ground that its result was mandated by statute and that the conflicting rule was

simply unlawful.”). I think that bypassing the procedures of notice and comment is

especially justified in this case, where the regulation at issue relates to the Board’s

jurisdiction. See New York v. F.E.R.C., 535 U.S. 1, 18 (2002) (“‘[A]n agency literally has

no power to act . . . unless and until Congress confers power upon it.’” (citation

omitted)).

Sannier and Stephens do not change my conclusion. The majority reasons that

Sannier and Stephens recognized the Doyle interpretation as reasonable and,

therefore, preclude us from now finding it inconsistent with section 7521. I disagree. In

my view, neither Sannier nor Stephens presented us with the question of whether the

Doyle interpretation of 5 U.S.C. § 7521 was reasonable. Both cases merely asked us to

review the Board’s conclusion that the petitioners had not sufficiently alleged that their

employing agencies had interfered with their qualified judicial independence. More

importantly, in both cases we affirmed. Therefore, because the Board lacked

03-3286, -3330, -3331 12
jurisdiction in both cases even under the more lenient standard of Doyle, we were not

asked to reach the issue of whether the Board had jurisdiction over a constructive

removal claim where the ALJ was not actually separated from the agency. See Watson

v. Dep’t of the Navy, 262 F.3d 1292, 1301-02 (Fed. Cir. 2001) (holding that we were not

bound by our prior decision in Bingaman v. Department of the Treasury, 127 F.3d 1431

(Fed. Cir. 1997), because that case, while recognizing the Board’s approach, did not

actually adopt it).

The majority, on the other hand, contends that “Sannier and Stephens adopted

and applied the Board’s Doyle standard.” Supra, at 14. Admittedly, in both cases we

quoted relevant portions from the Doyle holding, but I do not think we ever decided

whether the Doyle holding was correct. I would also agree that we applied Doyle to the

extent we affirmed the Board’s findings of no jurisdiction based on the fact that the

petitioners had not shown interference with their qualified judicial independence.

However, because we affirmed a finding of no jurisdiction, the facts of those two cases

did not present us with the issue of whether jurisdiction could be established without

showing actual separation. In other words, in neither Sannier nor Stephens was it

necessary to address the issue of separation given that the petitioners did not even

satisfy the more lenient standard of Doyle. See Seminole Tribe of Florida v. Florida,

517 U.S. 44 (1996) (“When an opinion issues for the Court, it is not only the result but

also those portions of the opinion necessary to that result by which we are bound.”).

For the foregoing reasons, I do not see reversible error in the Board’s decision

overruling its erroneous interpretation in Doyle and invalidating 5 C.F.R. § 1201.142

03-3286, -3330, -3331 13
without following the notice-and-comment process of the APA. I thus would affirm the

decision of the Board. I therefore respectfully dissent.

03-3286, -3330, -3331 14