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Sloan v. Department of Housing & Urban Development

Court: Court of Appeals for the D.C. Circuit
Date filed: 2000-11-14
Citations: 231 F.3d 10, 343 U.S. App. D.C. 376
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25 Citing Cases

                  United States Court of Appeals

               FOR THE DISTRICT OF COLUMBIA CIRCUIT

      Argued September 11, 2000   Decided November 14, 2000 

                           No. 99-5146

                       Leon Sloan, Sr. and 
                        Jimmie Lee Furby, 
                            Appellants

                                v.

       Department of Housing & Urban Development, et al., 
                            Appellees

          Appeal from the United States District Court 
                  for the District of Columbia 
                         (No. 97cv00764)

     James K. Kearney and Joseph L. Luciana, III argued the 
cause for appellants.  With them on the briefs were James P. 
Gallatin, Jr., David T. Case, and A. Thomas Morris.

     Scott S. Harris, Assistant United States Attorney, argued 
the cause for appellees.  With him on the brief were Wilma 

A. Lewis, United States Attorney, and R. Craig Lawrence, 
Assistant United States Attorney.

     Before:  Edwards, Chief Judge, Henderson and Garland, 
Circuit Judges.

     Opinion for the Court filed by Chief Judge Edwards.

     Edwards, Chief Judge:  Appellants Leon Sloan, Sr. and 
Jimmie Lee Furby were partners and owners of J&L Reno-
vation Company ("J&L"), a small demolition contracting com-
pany specializing in interior demolition.  On August 18, 1995, 
they received a notice from the United States Department of 
Housing and Urban Development ("HUD") that the agency 
was seeking debarment of Sloan, Furby, and J&L from 
government contracting for a period of five years based upon 
allegations of improper clean-up and disposal of waste at a 
public housing construction site.  HUD issued suspensions 
pending a final determination on the debarment action.  In 
August 1996, a HUD Administrative Law Judge ("ALJ") 
denied the five-year debarment and terminated the suspen-
sions.  The ALJ, however, declined to void the suspensions ab 
initio, and the Secretary of HUD affirmed this decision.

     Sloan and Furby sought relief in the District Court, claim-
ing that the agency's failure to void the suspensions ab initio 
violated the Administrative Procedure Act ("APA"), and that 
the actions of various HUD officials deprived them of due 
process.  In a second complaint against individual HUD 
officials, Sloan and Furby sought damages under Bivens v. 
Six Unknown Named Agents of the Federal Bureau of 
Narcotics, 403 U.S. 388 (1971).  The District Court, after 
consolidating the cases, entered an order dismissing the 
consolidated complaint.  In a related, unconsolidated case, 
Sloan and Furby brought claims pursuant to the Federal Tort 
Claims Act ("FTCA").  Appellants' FTCA claims are the 
subject of a separate appeal, Sloan v. United States Depart-
ment of Housing and Urban Development, No. 99-5145, 
heard on the same day as this case.

     Appellants raise two principal issues in the instant appeal.  
Appellants' first claim is that HUD's refusal to void their 

suspensions ab initio was arbitrary and capricious.  Appellee 
HUD contends that there was ample evidence to support the 
suspensions at the time they were imposed, as well as when 
the case was heard by the ALJ.  We disagree.  HUD origi-
nally had based the issuance of the suspensions on three 
distinct charges.  The debarment proceeding conclusively 
revealed that the first and third charges--relating to hazard-
ous waste containment--were completely unsupported.  Fur-
thermore, the ALJ did not find, and HUD does not argue, 
that the second charge alone--relating to improper disposal 
of construction debris--would have supported issuance of the 
suspensions.  Finally, the Secretary's decision is devoid of 
any good reason to justify the denial of the relief sought by 
appellants.  On this record, we hold that the agency's failure 
to void the suspensions ab initio was arbitrary and capricious.

     Appellants' second claim challenges the District Court's 
finding that the APA's comprehensive remedial structure 
precludes recognition of appellants' Bivens claims.  We need 
not reach this issue, however, because we reject appellants' 
claim that individual HUD defendants violated their constitu-
tional rights to due process in conducting and supervising the 
investigations and prosecution associated with the suspen-
sions and debarment proceedings.  We therefore affirm the 
judgment of the District Court dismissing the Bivens claims.

                          I. Background

A.   Factual Background

     In 1989, the Allegheny County Housing Authority 
("ACHA") received funds from HUD to perform moderniza-
tion work at the Burns Heights public housing project in 
Duquesne, Pennsylvania.  Part of the funding was intended 
for lead-based paint testing at the site.  Because a previous 
x-ray fluorescence ("XRF") test for lead-based paint had 
proven inconclusive, ACHA prepared specifications calling for 
the demolition contractor to assume all existing painted sur-
faces contained lead-based paint.

     In November 1992, Mistick Construction, PBT ("Mistick"), 
in conjunction with its bid for demolition work at Burns 
Heights, reviewed ACHA's XRF test and hired an industrial 
hygienist to perform a toxic characteristic leaching procedure 
("TCLP") test of Burns Heights wall debris.  The TCLP test 
established that the lead content of the wall debris was 
substantially less than the United States Environmental Pro-
tection Agency ("EPA") threshold for hazardous waste.  
ACHA subsequently hired Mistick to perform the demolition 
work.

     In January 1993, before beginning the demolition work, 
Mistick conducted a test of the air inside the Burns Heights 
buildings to determine whether hazardous levels of lead were 
present.  The air test results indicated that lead levels were 
significantly less than the Occupational Safety & Health 
Administration ("OSHA") limit;  Mistick therefore concluded 
that OSHA worker protection requirements need not be 
followed when work was done on the site.  Mistick provided 
the TCLP and air test results to ACHA, and ACHA con-
firmed that hazardous lead-based paint protocols were not 
required for demolition work at Burns Heights.  The parties 
agreed, in writing, that the test results were "well within 
EPA guidelines" and that demolition waste from Burns 
Heights need not be disposed of as contaminated waste.  
Mistick Inc. Proposed Hazardous Materials Work Plan for 
the Burns Heights Project (Jan. 7, 1993), reprinted in Appen-
dix ("App.") 416, 419.

     In February 1993, Mistick subcontracted the interior demo-
lition work at Burns Heights to J&L, the company owned by 
appellants Sloan and Furby.  From February 1993 until May 
1995, when J&L completed its demolition work, J&L disposed 
of most of its demolition debris in dumpsters provided by 
Mistick.  For a period beginning in 1994, however, J&L 
began separating plaster from other demolition debris and 
delivering it to an unapproved landfill (the "Perrone site").  
Under the then applicable Pennsylvania regulations, plaster 
was defined as construction/demolition waste which had to be 
dumped in an approved landfill.  See 25 Pa. Code s 271.1 
(1999) (adopted April 8, 1988, effective April 9, 1988).  Appel-

lants were unaware of the change in state regulations.  See 
Matter of Sloan, HUDBCA Nos. 96-C-106-D3, 96-C-107-
D4, 96-C-108-D5, 1996 WL 506267 (H.U.D.B.C.A. Aug. 30, 
1996) (ALJ determination) (finding that appellants "would not 
have dumped the plaster debris in an unapproved landfill if 
they had been aware of the change in state regulations").

     Upon discovering that a rival construction group was fol-
lowing and taping J&L's dumping activities, Mistick request-
ed J&L to discontinue disposing of plaster at the unapproved 
site, which J&L did.  Mistick subsequently informed the 
Pennsylvania Department of Environmental Protection 
("Pennsylvania DEP") of the placement of plaster at the 
Perrone site.  The Pennsylvania DEP determined that no 
action was required.

     In November 1994, during an unrelated HUD debarment 
proceeding, HUD received information that Mistick was not 
properly performing lead-based paint abatement at Burns 
Heights.  Thereafter, two HUD officials, Mark Chandler, an 
auditor in HUD's Office of Inspector General, and Dane 
Narode, an attorney from HUD's Office of Public and Indian 
Housing, began investigating the demolition work at Burns 
Heights.  Chandler conducted the performance audit.

     Chandler and Narode visited the Perrone site, where they 
observed paint chips resembling those from the Burns 
Heights project before allegedly being chased from the site 
by its owner.  Chandler and Narode also visited Burns 
Heights where they photographed J&L's failure to contain 
dirt, dust, and paint chips.  Chandler then spoke with Furby 
on the telephone and also met with David McLean, Director 
of Maintenance and Development for ACHA.  During the 
latter conversation, McLean mistakenly indicated that Burns 
Heights was an ACHA lead-based paint project.  Chandler 
did not inquire as to whether there were hazardous levels of 
lead at Burns Heights nor whether lead-based paint abate-
ment was being performed there.

     Subsequent to his meeting with McLean, Chandler received 
from ACHA copies of the XRF test, the November 1992 
TCLP test, and the January 1993 air test.  These tests 

clearly indicated that there were no hazardous levels of lead 
present at Burns Heights, but Chandler was not qualified to 
interpret or evaluate the test results.  Amazingly, Chandler 
did not ask either ACHA or Mistick what the test results 
meant and he never spoke to Mistick or J&L about whether 
the subcontract covered lead-based paint abatement.  Chan-
dler's final audit report, which was sent to HUD's Pittsburgh 
Area Office on October 18, 1995, stated, without good basis, 
that Mistick and J&L had failed to properly perform lead-
based paint abatement;  on this erroneous finding, Chandler's 
report concluded that Mistick and J&L had not performed 
demolition work at Burns Heights in accordance with contrac-
tual requirements.

B.   Administrative Proceedings

     On August 18, 1995, three months after the demolition 
work at Burns Heights had been completed, Assistant Secre-
tary for Public and Indian Housing Joseph Shuldiner noti-
fied Sloan and Furby that they were suspended from all 
HUD-related government contracting work and that HUD 
was seeking a five-year debarment from participation in 
HUD-funded construction work.  The notice asserted that 
the Department had information "indicating serious irregu-
larities in [J&L's] business dealings with the Government," 
namely:  (1) improper cleanup of waste from the lead-based 
paint abatement process;  (2) improper disposal of construc-
tion debris from the demolition;  and (3) failure to adhere to 
contract requirements or HUD Guidelines by allowing haz-
ardous waste to be tracked outside of containment and al-
lowing workers to perform abatement work without proper 
notification.  See Letters from Joseph Shuldner, Assistant 
Secretary, HUD, to Jimmie L. Furby, Leon Sloan, Sr., and 
J&L Renovation Company (Aug. 18, 1995), reprinted in App. 
151, 153, 155.  George Dickey, a HUD Program Official in 
the Office for Public and Indian Housing, processed the 
sanctions against Mistick and J&L.

     Appellants contend that, during discovery for the debar-
ment proceeding, they requested depositions of Assistant 
Secretary Shuldiner and Dickey.  HUD opposed the deposi-

tions and the ALJ denied the requests.  Appellants also aver 
that, during discovery, HUD failed to produce an exchange of 
letters confirming that ACHA did not find "sufficient grounds 
to pursue a claim for non-performance, and that contamina-
tion and associated costs are non-existent."  See Letter from 
George Arendas, Executive Director, ACHA, to Paul LaMar-
ca, HUD Pittsburgh Area Office (Jan. 17, 1995), reprinted in 
App. 174.  Appellants argue that the failure to produce these 
"exculpatory documents" hindered their efforts at the debar-
ment proceeding.  See Appellants' Br. at 14.

     On August 30, 1996, after a five-day administrative hearing, 
the ALJ rejected the Government's case seeking debarment 
and terminated the suspensions against J&L, Sloan, and 
Furby.  Matter of Sloan, 1996 WL 506267 (ALJ determina-
tion).  The ALJ specifically found that "there was not a lead 
hazard present at Burns Heights that would have made lead-
based paint abatement protocols necessary."  Id.  The ALJ, 
however, denied Sloan and Furby's request to have their 
suspensions voided ab initio.  The ALJ's decision not to void 
the suspensions ab initio was based on an erroneous finding 
that the written contract documents required Mistick to treat 
the job as though there were hazardous levels of lead present 
at Burns Heights.  See id.  After unsuccessfully appealing 
the ALJ's ruling to the HUD Secretary, Sloan and Furby 
filed suit in the District Court.

                           II. Analysis

A.   The APA challenge

     The disputed suspension and debarment actions in this case 
arose pursuant to the federal regulations implementing sec-
tion 3 of Executive Order 12549, 51 Fed. Reg. 6370 (1986), 
which provides that, to the extent permitted by law, Execu-
tive departments and agencies shall participate in a govern-
ment-wide system for nonprocurement debarment and sus-
pension.  24 C.F.R. s 24.100(a) & (b) (1995).  Under the 
applicable regulations, debarment and suspension are discre-
tionary measures taken to protect the public interest and to 
promote an agency's policy of "conduct[ing] business only 

with responsible persons."  24 C.F.R. s 24.115(a) (1995).  
The issuance of a suspension is a "serious action," hence it 
"may be imposed only when:  (1) [t]here exists adequate 
evidence of one or more of the causes set out in s 24.405, and 
(2) [i]mmediate action is necessary to protect the public 
interest."  24 C.F.R. s 24.400(b) (1995);  see also 24 C.F.R. 
s 24.405 (1995).  A party who contests a suspension or possi-
ble debarment may request a hearing before an ALJ pursu-
ant to 24 C.F.R. s 24.313 (1995), followed by an appeal to and 
discretionary review by the Secretary pursuant to 24 C.F.R. 
s 24.314(c) (1995).  Any review taken by the Secretary "shall 
be based on the record of the initial hearing [before the ALJ] 
and shall fully recite the evidentiary grounds upon which the 
Secretary's determination is made."  24 C.F.R. s 24.314(e) 
(1995).

     The parties agree that judicial review of the Secretary's 
final decision in this case is available pursuant to the Adminis-
trative Procedure Act ("APA"), 5 U.S.C. ss 702, 704, 706 
(1994).  Appellants contend that the agency's refusal to void 
their suspensions ab initio was arbitrary and capricious and 
thus violated s 706(2)(A) of the APA, and that the agency's 
administrative procedures infringed their due process rights 
in violation of s 706(2)(B) of the APA.  We find merit in 
appellants' first claim.

     Neither party contests the applicability of the APA's "arbi-
trary and capricious" standard.  Appellee urges, nonetheless, 
that our review of HUD's decision in the instant case should 
be "highly deferential," and "presume the validity of agency 
action."  See Appellees' Br. at 15 (quoting Kisser v. Cisneros, 
14 F.3d 615, 618 (D.C. Cir. 1994)).  It is well-established that, 
when conducting review under the "arbitrary and capricious" 
standard, a court may not substitute its judgment for that of 
agency officials;  rather, our inquiry is focused on whether 
"the agency [ ] examine[d] the relevant data and articulate[d] 
a satisfactory explanation for its action including a 'rational 
connection between the facts found and the choice made.' "  
Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto. Ins. Co., 
463 U.S. 29, 43 (1983) (quoting Burlington Truck Lines, Inc. 
v. United States, 371 U.S. 156, 168 (1962)).  Our deference to 

agency decisionmaking does not require us, however, to coun-
tenance an agency's failure to "consider[ ] ... relevant fac-
tors" or "clear error[s] of judgment."  Id. (quoting Bowman 
Transp., Inc. v. Arkansas-Best Freight Sys., Inc., 419 U.S. 
281, 285 (1974)).

     On the basis of the record before us, we find that HUD's 
decision not to void the suspensions ab initio cannot with-
stand review, because the decision cannot be squared with the 
applicable regulations and, also, because the decisions of the 
ALJ and the Secretary fail to "articulate a satisfactory expla-
nation for [the agency's] action including a 'rational connec-
tion between the facts found and the choice made.' "  State 
Farm, 463 U.S. at 43 (quoting Burlington Truck Lines, Inc., 
371 U.S. at 168).

     Under the applicable regulations, a suspension is justified 
only when there is "adequate evidence" of wrongdoing and 
"immediate action is necessary to protect the public interest."  
24 C.F.R. s 24.400(b).  "In assessing the adequacy of the 
evidence, the agency should consider how much information is 
available, how credible it is given the circumstances, whether 
or not important allegations are corroborated, and what infer-
ences can reasonably be drawn as a result."  24 C.F.R. 
s 24.400(c) (1995).  Moreover, the agency's "assessment 
should include an examination of basic documents such as 
grants, cooperative agreements, loan authorizations, and con-
tracts."  Id.  In applying these regulations, the ALJ and the 
Secretary are required to consider both whether there is 
adequate justification for the suspensions at the time they are 
issued, and whether, in light of the evidence adduced at the 
debarment hearing, there is good reason to terminate the 
suspensions.  See 24 C.F.R. ss 24.313, 24.314 (1995).

     Many years ago, in Horne Brothers, Inc. v. Laird, 463 F.2d 
1268 (D.C. Cir. 1972), Judge Leventhal had occasion to con-
strue what it means for an agency to have "adequate evi-
dence" to justify the "suspension" of a government contrac-
tor:

     The "adequate evidence" showing need not be the kind 
     necessary for a successful criminal prosecution or a 
     
     formal debarment.  The matter may be likened to the 
     probable cause necessary for an arrest, a search warrant, 
     or a preliminary hearing.  This is less than must be 
     shown at the trial, but it must be more than uncorrob-
     orated suspicion or accusation.
     
Id. at 1271.  Obviously, as Horne Brothers suggests, "[a] 
question of judgment is involved" in any agency decision 
to issue a suspension.  Id.  What is noteworthy here, how-
ever, is that, under the controlling regulations, there can 
be no suspension without "adequate evidence," the necessi-
ty of "immediate action...to protect the public interest," a 
consideration of "whether or not important allegations are 
corroborated," "an examination of basic documents," and a 
determination, based on "all available evidence," that rea-
sonable inferences of wrongdoing can be drawn.  24 
C.F.R. ss 24.400, 24.410 (1995).

     At the hearing before the ALJ, the Government withdrew 
the third ground for debarment and suspension--failure to 
adhere to contract requirements or HUD Guidelines--recog-
nizing that the agency had nothing concrete upon which to 
justify this charge.  The ALJ subsequently dismissed the 
first charge--improper cleanup of waste from the lead-based 
paint abatement process--finding no basis in the record.  
Matter of Sloan, 1996 WL 506267 (ALJ determination).  This 
left only the charge that J&L had improperly disposed of 
construction debris from the demolition.  The ALJ did not 
find, and appellee does not argue, that this single remaining 
charge provided cause for the suspensions.  Rather, appellee 
asserts that the decision not to void the suspensions ab initio 
should be upheld because the administrative judge found 
appellants and Mistick largely to blame for the misunder-
standings leading to the faulty audit and resulting sanctions.  
The suggestion that appellants should bear the onus of 
HUD's poor investigatory work is ridiculous.  Had HUD 
officials been more precise in their investigation, they would 
have discovered that the November 1992 TCLP test and the 
January 1993 air test clearly established that there were no 
hazardous levels of lead present at Burns Heights.  The 

auditor had only to examine the test results or request 
assistance with their interpretation.

     We also reject appellee's related argument, that the deci-
sion not to void the suspensions ab initio rests on the ALJ's 
conclusion that government investigators had been misled 
into thinking that lead abatement was part of the disputed 
contract because the change in contract specification regard-
ing lead abatement had not been captured in a written 
amendment.  See Appellees' Br. at 20-21.  The ALJ's finding 
on this point is simply wrong;  the record is clear that the 
parties had agreed in writing that demolition waste from 
Burns Heights need not need be disposed of as contaminated 
waste.  See Mistick Inc. Proposed Hazardous Materials Work 
Plan for the Burns Heights Project, reprinted in App. 416, 
419 (Jan. 7, 1993).

     Whatever agency officials may have thought about the case 
against the appellants when the suspensions were issued, 
their view of the case should have changed rather dramatical-
ly following the hearing before the ALJ.  The hearing made 
it clear that the initial finding of probable cause was flimsy at 
best, riding on the heels of a hastily-conducted and technical-
ly-flawed audit.  In other words, even if HUD officials 
thought they had more than "uncorroborated suspicion or 
accusation" at the time when the suspensions were issued, it 
was abundantly clear at the conclusion of the hearing that 
there had been no basis at the outset to suspend appellants.  
It was therefore arbitrary and capricious for the agency to 
deny full relief to appellants.

     Government contracting has become an economic mainstay 
for a number of commercial enterprises.  It goes without 
saying, therefore, that disqualification from government con-
tracting is a very serious matter for these businesses.  See 
Gonzalez v. Freeman, 334 F.2d 570, 574 & n.5 (D.C. Cir. 
1964).  In this case, appellants have endured economic losses, 
professional indignities, and injuries to their reputations, and 
these sufferings no doubt will continue to linger so long as 
appellants are tarnished by an official record suggesting that 
they engaged in "serious irregularities" in their business 

dealings with the Government.  Even the applicable regula-
tions recognize the potentially harsh consequences that flow 
from suspension, for they make it clear that "[s]uspension is a 
serious action" that should be imposed only "when it has been 
determined that immediate action is necessary to protect the 
Government's interest."  24 C.F.R. s 24.410(c).

     In this case, appellants' claim for relief was sufficiently 
compelling that the Secretary granted review specifically to 
consider the following question:  "Under what circumstances 
is it appropriate for the Secretarial designee to void a suspen-
sion ab initio when, in hindsight, it is clear that the Respon-
dents are not guilty of the charges that led to the suspen-
sion?"  Matter of Sloan, HUDBCA Nos. 96-C-106-D3, 96-C-
107-D4, 96-C-108-D5 (Nov. 18, 1996) (order granting respon-
dent's petition for secretarial review);  see also Matter of 
Sloan, HUDBCA Nos. 96-C-106-D3, 96-C-107-D4, 96-C-
108-D5 (Dec. 18, 1996) (order on Secretarial review), reprint-
ed in App. 452 n.1.  It is not surprising that the Secretary 
accepted discretionary review of the appellants' administra-
tive appeal, for the Secretary's decision does not doubt the 
availability of the relief sought by appellants.  See Matter of 
Guillen, HUDBCA No. 91-1739-DB, 1992 WL 45853 
(H.U.D.B.C.A. Feb. 28, 1992) (ALJ determination).  What is 
surprising, however, is the Secretary's treatment of appel-
lants' claim.

     It is clear that there was no need for "immediate action" to 
be taken against appellants.  See 24 C.F.R. s 24.400(b)(2).  
The Secretary's decision does not suggest that appellants 
should have been suspended for the allegations that prompted 
the first and third charges.  And the Secretary acknowledges 
that appellants' alleged improper activity in connection with 
the second charge--placing debris in an unapproved landfill--
had ceased before the issuance of the suspensions.  In other 
words, the Secretary could not find that there was adequate 
evidence that appellants lacked "present responsibility" when 
the suspensions were issued.  Nonetheless, the Secretary's 
decision suggests that appellants' "past irresponsible acts" in 
connection with the second charge justified the suspensions.  
See Matter of Sloan (order on Secretarial review), reprinted 

in App. 454.  This is a specious conclusion.  First, the 
Secretary's decision simply ignores the requirement that 
there must be a real need for immediate action to protect the 
public interest in order to justify a suspension.  Further-
more, as noted above, the Government does not contend that 
the second charge against appellants, without more, could 
have warranted suspensions, so the Secretary's reason for 
refusing to void the suspensions ab initio makes no sense.

     The Secretary's decision is at best a half-hearted attempt 
to address appellants' claim for relief.  And, as is true with 
portions of the ALJ's decision, the Secretary's decision seems 
to blame the appellants for the blunders committed by agency 
investigators.  In short, the decision fails to "articulate a 
satisfactory explanation for [the agency's] action including a 
'rational connection between the facts found and the choice 
made.' "  State Farm, 463 U.S. at 43 (quoting Burlington 
Truck Lines, Inc., 371 U.S. at 168).  Accordingly, we find the 
agency's action to be arbitrary and capricious.

     Because we find that the decision not to void the suspen-
sions ab initio was arbitrary and capricious, we need not 
linger on appellants' alternative argument that HUD violated 
the due process rights of Sloan and Furby by failing to 
produce critical witnesses and HUD documents.  "An agency 
may not impose even a temporary suspension without provid-
ing the 'core requirements' of due process:  adequate notice 
and a meaningful hearing."  Commercial Drapery Contrac-
tors, Inc. v. United States, 133 F.3d 1, 6 (D.C. Cir. 1998);  see 
also Reeve Aleutian Airways, Inc. v. United States, 982 F.2d 
594, 595, 599-602 (D.C. Cir. 1993).  In the instant case, the 
procedures followed by HUD adequately safeguarded appel-
lants' due process rights.

B.   The Bivens claims

     In asserting their Bivens claims for money damages 
against individual HUD defendants, appellants charge that 
HUD officials violated their due process rights in conducting 
and supervising the audit, processing and issuing the sanc-
tions, and prosecuting the suspensions.  The District Court 
held that any Bivens remedy was precluded by the availabili-

ty of relief under the APA.  Examining the APA, the District 
Court found it to be a comprehensive remedial scheme for 
administering public rights which did not inadvertently omit 
damage remedies for certain claimants.

     We need not decide whether the APA precludes appellants' 
Bivens claims, because we find that appellants have failed to 
allege the violation of a constitutional right.  The focus here, 
in contrast to the APA claim, is on the investigation into 
appellants' alleged misdeeds as well as the decisions to pro-
cess and enforce the administrative sanctions--not the result-
ing records of suspension.  Indeed, with the exception of the 
claim against Attorney Narode for prosecution of the adminis-
trative action, all of appellants' Bivens claims center mainly 
on the investigations conducted before the administrative 
hearing.

     Appellants maintain that the disputed investigations and 
prosecution by government officials violated their due process 
rights.  The law is clear, however, that "there is no constitu-
tional right to be free of investigation," United States v. 
Trayer, 898 F.2d 805, 808 (D.C. Cir.), cert. denied, 498 U.S. 
839 (1990), and appellants have not shown that the investiga-
tion was part of a scheme or conspiracy to deprive them of 
their constitutional rights.  See, e.g., Anthony v. Baker, 767 
F.2d 657, 662 (10th Cir. 1985).

     Appellants contend that individual HUD employees contra-
vened the broad standards incorporated in HUD's Consolidat-
ed Audit Guide for Audits of HUD Programs, but these 
alleged violations do not support a claim for denial of due 
process.  See, e.g., Schweiker v. Hansen, 450 U.S. 785, 789, 
reh'g denied, 451 U.S. 1032 (1981) (stating that Social Securi-
ty Administration claims manual, as opposed to official regu-
lations, had no legal force);  Kugel v. United States, 947 F.2d 
1504, 1507 (D.C. Cir. 1991) (department guidelines "do not 
create a duty in favor of the general public");  Lynch v. 
United States Parole Comm'n, 768 F.2d 491, 497 (2d Cir. 
1985) (finding that Police Commission internal procedures 
manual did not create due process rights enforceable in 
court).  We therefore conclude that the errors committed by 

HUD officials during their investigation of appellants did not 
rise to the level of constitutional infringement.

     Furthermore, as noted above, appellants were given clear 
notice of the charges against them and a fair opportunity to 
prepare a defense;  they were then afforded extensive rights 
to a full hearing before an ALJ, during which the Govern-
ment carried the burden of proof, followed by an appeal to 
the Secretary and then judicial review.  In other words, they 
were given a full panoply of due process protections to 
redress any preceding mistakes that may have occurred 
during the agency investigations.  Assuming, arguendo, that 
appellants had cognizable property or liberty interests justify-
ing due process protections, see, e.g., Old Dominion Dairy 
Prods. v. Secretary of Defense, 631 F.2d 953 (D.C. Cir. 1980), 
the postdeprivation procedures provided under HUD regula-
tions were more than enough to satisfy the requirements of 
procedural due process.  See Hudson v. Palmer, 468 U.S. 
517, 533 (1984);  see also Stuto v. Fleishman, 164 F.3d 820, 
825 (2d Cir. 1999) (quoting Hudson, 468 U.S. at 533) ("[T]he 
negligent or intentional deprivation of property through the 
random and unauthorized acts of a state or federal employee 
does not constitute a deprivation of due process if 'a meaning-
ful postdeprivation remedy for the loss is available.' ").

     Finally, appellants' claims against Attorney Narode for 
prosecution of the administrative sanctions fail because of 
absolute immunity.  See Butz v. Economou, 438 U.S. 478, 
516-17 (1978);  Imbler v. Pachtman, 424 U.S. 409, 424-29 
(1976).  In Butz, the Court held that, in general, federal 
executive officials charged with constitutional violations were 
entitled only to qualified immunity.  See Butz, 438 U.S. at 
507.  The Court noted, however, that there were "some 
officials whose special functions require[d] a full exemption 
from liability," id. at 508, and observed that the adjudicatory 
process within federal administrative agencies "share[d] 
enough of the characteristics of the judicial process that those 
who participate in such adjudication should also be immune 
from suits for damages."  Id. at 512-13.  Finding "no sub-
stantial difference between the function of the agency attor-
ney in presenting evidence in an agency hearing and the 

function of the prosecutor who brings evidence before a 
court," id. at 516, the Court granted absolute immunity to 
federal attorneys whose duties in administrative proceedings 
were functionally similar to those of a prosecutor.  See id. at 
517.  We recognize a fortiori that the actions taken to enforce 
the sanctions against Sloan and Furby, such as presenting 
evidence at the administrative hearing, deserve no less pro-
tection from suit.

     In view of our conclusion that appellants have not alleged 
the violation of a constitutional right, we need not determine 
whether appellants' Bivens claims are precluded by the APA.  
This court has suggested that a Bivens action may be fore-
closed where the possibility of judicial review under the APA, 
along with other "statutes, executive orders and regulations," 
provides a meaningful remedy.  Krodel v. Young, 748 F.2d 
701, 712-13 & 712 n.6 (D.C. Cir. 1984), cert. denied, 474 U.S. 
817 (1985).  The Government, however, did not suggest that 
Krodel was applicable here.

                         III. Conclusion

     For the foregoing reasons, the judgment of the District 
Court is affirmed in part and reversed in part.  The agency's 
refusal to void appellants' suspensions ab initio was arbitrary 
and capricious and is accordingly reversed.  The case is 
hereby remanded to the agency with instructions to make 
void appellants' suspensions ab initio.

                                                        So ordered.