Ryan, John Clement v. Reno, Janet

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued December 7, 1998 Decided February 26, 1999

No. 98-5036

John Clement Ryan, Eugene Glynn,

Francis Reale and Joseph Halvey,

Appellants

v.

Janet Reno, United States Attorney General,

United States Department of Justice and

United States Immigration & Naturalization Service,

Appellees

Appeal from the United States District Court

for the District of Columbia

(No. 96cv01015)

William F. Causey argued the cause for the appellants.
Harry J. Kelly, III was on brief for the appellants.

Diane M. Sullivan, Assistant United States Attorney, ar-
gued the cause for the appellees. Wilma A. Lewis, United

States Attorney, and R. Craig Lawrence, Assistant United
States Attorney, were on brief for the appellees.

Before: Ginsburg, Henderson and Rogers, Circuit Judges.

Opinion for the court filed by Circuit Judge Henderson.

Karen LeCraft Henderson, Circuit Judge: Appellants
John C. Ryan, Eugene Glynn, Francis Reale and Joseph
Halvey challenge the district court's dismissal of their em-
ployment discrimination suit. In their complaint the appel-
lants, who are of Irish birth and of dual Irish and American
citizenship, alleged that the United States Department of
Justice (DOJ) and the United States Immigration and Natu-
ralization Service (INS) denied them security clearances and
withdrew offers of employment contingent on the clearances
on account of national origin and citizenship in violation of
Title VII of the Civil Rights Act of 1964, 42 U.S.C. s 2000e-
2.1 The district court dismissed the action, concluding it
lacked jurisdiction to review the reason given for withdrawing
the offers-that because of the length of time the appellants
had lived abroad, DOJ could not conduct adequate back-
ground investigations to grant them the required clearances.
We review the district court's dismissal for lack of jurisdiction
de novo, taking as true the facts alleged in the complaint.
Moore v. Valder, 65 F.3d 189, 196 (D.C. Cir. 1995), cert.
denied, 117 S. Ct. 75 (1996). Applying this standard, we
conclude that the district court's dismissal should be affirmed.

I.

The material facts are undisputed. In April 1998 INS
announced openings for Immigration Inspectors at Shannon

__________
1 Subsection (a)(1) of section 2000e-2 makes it "an unlawful
employment practice for an employer ... to fail or refuse to hire or
to discharge any individual, or otherwise to discriminate against any
individual with respect to his compensation, terms, conditions, or
privileges of employment, because of such individual's race, color,
religion, sex, or national origin." 42 U.S.C. s 2000e-2(a)(1). The
complaint also alleged violation of the Civil Rights Act of 1866, as
amended, 42 U.S.C. s 1981, but the appellants have not pursued the
claim on appeal.

International Airport in Shannon, Ireland and published an
advertisement in Irish newspapers soliciting applicants. The
Immigration Inspector position is a "sensitive" one requiring
background investigations and security clearance of appli-
cants. The appellants, then residents of Ireland, applied for
the openings. In letters dated July 7, 1988 Robert A. Cleary,
Chief of the Operations Services Branch of the INS Person-
nel and Training Division, informed each of the applicants
that each had been "tentatively selected" for the positions
"pending satisfactory completion of security requirements"
and requested that each notify INS of his "acceptance or
declination" and complete and return enclosed security forms.
Joint Appendix (JA) 97-100. Each appellant accepted the
offer and returned the forms as requested. To expedite the
applicants' hiring, INS sent "waiver packages" to DOJ's
Office of Security and Emergency Planning Staff (SEPS). A
memorandum in each package requested "a waiver of the
preappointment full-field investigation" of each applicant and
asserted: "The individual will not have access to classified
information until after the requisite full-field background
investigation has been completed and an appropriate security
clearance granted pursuant to applicable Departmental regu-
lations. Access to sensitive Department of Justice informa-
tion will be kept to a minimum." See, e.g., JA 185, 186. The
waiver requests were "disapproved" on June 27, 1989. In a
memorandum to INS of the same date, SEPS Director Jerry
Rubino explained the disapproval:

Since these applicants have lived in Ireland for a period
of years and cannot be adequately investigated for the
purpose of determining their trustworthiness, and there-
fore their eligibility to occupy sensitive positions, I have
decided to disapprove your waiver request.

... I recommend that full-field [background investiga-
tions] should not be conducted on these individuals. Due
to the sensitivity of these positions, I believe that INS
should find candidates that have lived in the United
States for the last several years so that an adequate full-
field [background investigation] can be conducted.

JA 301. Accordingly, INS personnel chief Cleary informed
each applicant in a letter dated August 15, 1989: "The
Department of Justice Security Office has determined that,
since you have lived in Ireland for an extended period of time,
an adequate background investigation cannot be conducted to
determine your eligibility to occupy a sensitive position.
Therefore, we must withdraw our previous appointment of-
fer." See, e.g, JA 361-63. Later that year DOJ promulgated
a policy requiring that an Immigration Inspector applicant
"have for three of the five years immediately prior to apply-
ing for this position: 1) resided in the United States; 2)
worked for the United States overseas in a Federal or
military capacity; or 3) be [sic] a dependent of a Federal or
military employee serving overseas." JA 358.

In May and June 1990 the four unsuccessful applicants filed
discrimination complaints with DOJ. In a decision dated
September 29, 1993 an administrative law judge (ALJ) found
that "the Agency discriminated against Complainants on the
basis of their national origin, Irish American, when their
offers of tentative employment for the position of Immigra-
tion Inspector at Shannon Airport in Ireland were withdrawn
on August 15, 1989." JA 563. In a final agency decision
dated December 2, 1993 the DOJ Complaint Adjudication
Office rejected the ALJ's finding of discrimination both for
lack of evidentiary support and because the decision not to
issue a security clearance was unreviewable under Egan v.
Department of Navy, 484 U.S. 518 (1988).

On September 9, 1994 the four complainants appealed the
DOJ decision to the United States Equal Employment Oppor-
tunity Commission (EEOC), which affirmed DOJ on the sole
ground that the complainants had failed to prove discrimina-
tion. The EEOC rejected DOJ's conclusion that review of
the security clearance denial was barred, stating: "The Com-
mission has repeatedly held that it has no authority to review
the substance of security clearance determinations or the
validity of the employer's requirement of a security clearance,
but that it does have the authority to determine whether the
grant, denial, or revocation of a security clearance was con-
ducted in a nondiscriminatory manner." JA 606 (citations

omitted). On February 1, 1996 the EEOC denied the com-
plainants' request for reconsideration.

Ryan filed this action in the district court on May 2, 1996
and the three other plaintiffs were joined in December 1996.
On September 30, 1997 the government filed a motion to
dismiss or for summary judgment on the grounds that (1)
only one plaintiff (Ryan) had timely filed suit and (2) the
court lacked jurisdiction to review the security clearance
decision. In a memorandum opinion and order dated Janu-
ary 28, 1998 the district court dismissed the action for lack of
jurisdiction concluding it could not assess the sufficiency of
the plaintiffs' claims without reviewing Rubino's decision not
to grant security clearances-a review that was foreclosed
under Egan. The four plaintiffs appealed the dismissal.

II.

The outcome here is controlled, as DOJ and the district
court concluded, by the Supreme Court's decision in Egan v.
Department of Navy, 484 U.S. 518 (1988). The respondent in
Egan had been hired to work at the Navy's Trident Naval
Refit Facility in Bremerton, Washington contingent on "satis-
factory completion of security and medical reports." 484 U.S.
at 520. When the Director of the Naval Civilian Personnel
Command denied him a security clearance, Egan was dis-
charged as ineligible to work at the facility. Egan appealed
his discharge to the Merit Systems Protection Board (Board)
which concluded it was without authority to review the clear-
ance. Egan then appealed to the Federal Circuit Court of
Appeals, which reversed the Board and remanded for review
of the clearance decision. The Supreme Court granted cer-
tiorari and reversed the Federal Circuit, holding that the
Board lacked authority "to review the substance of an under-
lying decision to deny or revoke a security clearance in the
course of reviewing an adverse action." Egan, 484 U.S. at
520. The Court explained:

For "reasons ... too obvious to call for enlarged discus-
sion," CIA v. Sims, 471 U.S. 159, 170, 105 S.Ct. 1881,

 1888, 85 L.Ed.2d 173 (1985), the protection of classified
information must be committed to the broad discretion of
the agency responsible, and this must include broad
discretion to determine who may have access to it. Cer-
tainly, it is not reasonably possible for an outside nonex-
pert body to review the substance of such a judgment
and to decide whether the agency should have been able
to make the necessary affirmative prediction with confi-
dence. Nor can such a body determine what constitutes
an acceptable margin of error in assessing the potential
risk.

484 U.S. at 529. Three other circuits have held that Egan
applies in a Title VII action to preclude a "nonexpert body"--
whether administrative or judicial--from resolving a discrimi-
nation claim based on an adverse employment action resulting
from an agency security clearance decision. See Becerra v.
Dalton, 94 F.3d 145, 149 (4th Cir. 1996), cert. denied, 117
S. Ct. 1087 (1997); Perez v. FBI, 71 F.3d 513 (5th Cir. 1995),
cert. denied, 517 U.S. 1234 (1996); Brazil v. United States
Dep't of Navy, 66 F.3d 193, 195 (9th Cir. 1995), cert. denied,
517 U.S. 1103 (1996). We now join those courts.

To determine the merits of the appellants' Title VII claims,
it is necessary to apply the burden allocation scheme first
announced in McDonnell-Douglas Corp. v. Green, 411 U.S.
792 (1973):

Under the first step of McDonnell-Douglas the complain-
ant must establish a prima facie case of discrimination.
... If the complainant succeeds in establishing a prima
facie case, the second step of the McDonnell-Douglas
framework shifts the burden to the defendant employer
to articulate a legitimate, nondiscriminatory reason for
its adverse employment action. If the defendant does so,
then under the third step of McDonnell-Douglas the
complainant must produce evidence showing that the
defendant's proffered reason is but a pretext for discrim-
ination.

Paquin v. Federal Nat'l Mortgage Ass'n, 119 F.3d 23, 26
(D.C. Cir. 1997). In a case such as this, however, a court

cannot clear the second step of McDonnell-Douglas without
running smack up against Egan. The nondiscriminatory
reason proffered below for withdrawing the employment of-
fers was that the applicants' long residence abroad prevented
DOJ from conducting an adequate security clearance back-
ground investigation. The appellants could not challenge the
proffered reason's authenticity without also challenging its
validity-as their arguments before the district court made
manifest. See District Court Opinion at 19 (JA 26) n.12
("Plaintiffs repeatedly claim that the fact that the State
Department may have been able to conduct the investigation
abroad acts to undermine Mr. Rubino's decision that no
investigation adequately could assess the Plaintiffs' trustwor-
thiness."). As the Ninth Circuit explained:

The more valid a reason appears upon evaluation, the
less likely a court will be to find that reason pretextual;
the converse is also true. Even when the court faces
independent evidence of a discriminatory motive, it is
still necessary to weigh the validity of the defendant's
proffered reasons when deciding if they are pretextual.
In short, the merit of such decisions simply cannot be
wholly divorced from a determination of whether they
are legitimate or pretextual.

Brazil v. United States Dep't of Navy, 66 F.3d at 197.
Because the district court below could not proceed with the
appellants' discrimination action without reviewing the merits
of DOJ's decision not to grant a clearance, the court was
foreclosed from proceeding at all.

The appellants attempt to circumvent Egan by characteriz-
ing the challenged employment actions as procedural, di-
vorced from any substantive security determination. Accord-
ing to the appellants: "The focus of the district court would
be on the procedure used by DOJ to consider the waiver
requests and the reason why DOJ denied the waivers, and not
on whether the appellants should or should not receive actual
security clearances." Br. of Appellants at 36. But DOJ
denied the waivers because it concluded no clearances should
be granted without more extensive investigations than were

possible here. Thus, the waiver denials were tantamount to
clearance denials and were based on the same sort of "pre-
dictive judgment" that Egan tells us "must be made by those
with the necessary expertise in protecting classified informa-
tion," without interference from the courts. Egan, 484 U.S.
at 529.2

For the preceding reasons we hold that under Egan an
adverse employment action based on denial or revocation of a
security clearance is not actionable under Title VII.3 We
emphasize that our holding is limited to Title VII discrimina-
tion actions and does not apply to actions alleging deprivation
of constitutional rights. See Webster v. Doe, 486 U.S. 592, 603
(1988) ("[W]here Congress intends to preclude judicial review
of constitutional claims its intent to do so must be clear....
We require this heightened showing in part to avoid the
'serious constitutional question' that would arise if a federal
statute were construed to deny any judicial forum for a
colorable constitutional claim.") (citations omitted); National
Federation of Fed. Employees v. Greenberg, 983 F.2d 286, 289
(D.C. Cir. 1993); United States Information Agency v. Krc,
905 F.2d 389, 400 (D.C. Cir. 1990). The district court's
dismissal is

Affirmed.

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2 In fact, to support their "procedural" argument the appellants
expressly assert the feasibility of adequate investigations. See Br.
of Appellants at 41-43.

3 In Egan the Supreme Court noted its holding was "fortified" by
the fact that the Civil Service Reform Act of 1978 "by its terms
does not confer broad authority on the Board to review a security-
clearance determination." 484 U.S. at 530. Our decision is fortified
by Title VII's express language exempting employment actions
based on security clearance possession vel non. See 42 U.S.C.
s 2000e-2(g); see also Becerra v. Dalton, 94 F.3d 145, 149 (4th Cir.
1996) ("We agree that there is no unmistakable expression of
purpose by Congress in Title VII to subject the decision of the
Navy to revoke Becerra's security clearance to judicial scrutiny.").