Federal Circuits, 2nd Cir. (June 12, 1996)
Docket number: 95-6226
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U.S. Code - Title 5: Government Organization and Employees - 5 USC 553 - Sec. 553. Rule making
Code of Federal Regulations - Title 5: Administrative Personnel - 5 CFR 731.202 - Criteria.
U.S. Court of Appeals for the 2nd Cir. - Golden Pacific Bancorp, for Its Own Account and Derivatively on Behalf of and in the Name of Golden Pacific National Bank, Plaintiff-Appellant, Golden Pacific Bancorp, Counter-Defendant-Appellant, v. Federal Deposit Insurance Corporation, in Its Corporate Capacity and in Its Capacity as Receiver for Golden Pacific National Bank, Defendant-Appellee, Federal Deposit Insurance Corporation, Counter-Claimant., 375 F.3d 196 (2nd Cir. 2004) for Its Own Account and Derivatively on Behalf of and in the Name of Golden Pacific National Bank, Plaintiff-Appellant, Golden Pacific Bancorp, Counter-Defendant-Appellant, v. Federal Deposit Insurance Corporation, in Its Corporate Capacity and in Its Capacity as Receiver for Golden Pacific National Bank, Defendant-Appellee, Federal Deposit Insurance Corporation, Counter-Claimant.
Laurie Edelstein, New York City (Eric M. Lieberman, Michael Ludwig, Rabinowitz, Boudin, Standard, Krinsky & Lieberman, PC, New York City, of counsel), for Plaintiffs-Appellants.
Nancy A. Miller, Assistant United States Attorney, Brooklyn, NY (Zachary W. Carter, United States Attorney for the Eastern District of New York, Varuni Nelson, Assistant United States Attorney, Paul M. Geier, Rosalind A. Lazarus, Office of General Counsel, United States Department of Transportation, James Hicks, Steve Abel, Office of General Counsel, Office of Personnel and Management, of counsel), for Defendants-Appellees.Before: MINER, WALKER and LEVAL, Circuit Judges.MINER, Circuit Judge:Plaintiffs-appellants James S. Clarry, Archer Bailey, George G. Faulkner, David B. McCollum, and David P. Robertson (together, the "plaintiffs") appeal from a judgment entered in the United States District Court for the Eastern District of New York (Platt, J.) dismissing their amended complaint pursuant to Fed.R.Civ.P. 12(b)(6) for failure to state claims upon which relief may be granted. Clarry v. United States, 891 F.Supp. 105 (E.D.N.Y.1995). The district court found that the policy of the Office of Personnel Management ("OPM") that barred air traffic controllers who had participated in a strike against the federal government from employment with the Federal Aviation Administration ("FAA"), and from employment with private entities under contract with the FAA, did not violate the Due Process Clause of the Fifth Amendment or the Administrative Procedure Act ("APA"). The district court also determined that the plaintiffs did not have standing to challenge the FAA's policy of inserting in its contracts with private companies a prohibition against the employment of air traffic controllers who had participated in a strike against the federal government.For the reasons set forth below, we affirm the judgment of the district court.BACKGROUNDThis appeal arises from the 1981 air traffic controllers strike against the federal government. From approximately 1970 through 1981, the Professional Air Traffic Controllers Organization ("PATCO") was the exclusive bargaining representative for air traffic controllers employed by the FAA. On August 3, 1981, the members of PATCO commenced a nationwide strike against the federal government (the "strike").At the time of the strike, 5 U.S.C. 7311 provided that "[a]n individual may not accept or hold a position in the Government of the United States ... if he ... participates in a strike, or asserts the right to strike, against the Government of the United States." In addition, a regulation promulgated by OPM provided:When a person is disqualified for any reason named in § 731.202, OPM, in its discretion, may deny that person examination for and appointment to a competitive position for a period of not more than 3 years from the date of determination of disqualification. On expiration of the period of debarment, the person who has been debarred may not be appointed to any position in the competitive service until his fitness for appointment has been redetermined by OPM.5 C.F.R. § 731.303.1 Among the many reasons for disqualification enumerated in 5 C.F.R. § 731.202 was "[a]ny statutory disqualification which makes the individual unfit for the service."2 Section 7311 provided such a statutory disqualification.On August 3, 1981, President Reagan issued an ultimatum, stating that the striking air traffic controllers must return to work within 48 hours or forfeit their jobs. Thereafter, the federal government discharged approximately 11,000 striking air traffic controllers who had failed to return to work by August 5, 1981 (the "strikers"). The plaintiffs were among the strikers.Following the strike, OPM announced that it would bar the strikers from employment with the federal government for three years pursuant to 5 C.F.R. § 731.303. On December 9, 1981, President Reagan issued a memorandum to the Director of OPM ("President Reagan's Directive") that stated:The Office of Personnel Management has established the position that the former air traffic controllers who were discharged for participating in a strike against the Government initiated on August 3, 1981 shall be debarred from federal employment for a period of three years. Upon deliberation I have concluded that such individuals, despite their strike participation, should be permitted to apply for federal employment outside the scope of their former employing agency.Therefore, pursuant to my authority to regulate federal employment, I have determined that the Office of Personnel Management should permit federal agencies to receive applications for employment from these individuals and process them according to established civil service procedures. Your office should perform suitability determinations with respect to all such applicants according to established standards and procedures under 5 CFR, Part 731.After reviewing reports from the Secretary of Transportation and the Administrator of the Federal Aviation Administration, I have further determined that it would be detrimental to the efficiency of operations at the Federal Aviation Administration and to the safe and effective performance of our national air traffic control system to permit the discharged air traffic controllers to return to employment with that agency. Therefore, these former federal employees should not be deemed suitable for employment with the Federal Aviation Administration.I direct you to process their applications for reemployment with the federal government accordingly.17 Weekly Comp. Pres. Doc. 1364 (Dec. 9, 1981).OPM interpreted President Reagan's Directive as barring the strikers for an indefinite period from reemployment with the FAA and private entities under contract with the FAA. On January 6, 1982, OPM issued a bulletin stating that all strikers "shall be determined not to be suitable for reinstatement or appointment in any position in the Federal Aviation Administration, because it would be detrimental to the efficiency of that agency by interfering with or preventing its effective performance of its duties and responsibilities." Federal Personnel Manual Bulletin 731-6. In August of 1985, OPM reiterated its position by issuing a new bulletin stating that "[t]he debarment against reemployment of discharged controllers within the scope of the FAA is indefinite in duration." Federal Personnel Manual Bulletin 731-9.On August 27, 1992, Clarry filed a complaint in district court naming as defendants the United States, Andrew Card, as Secretary of Transportation, and Thomas Richards, as Administrator of the FAA. Clarry alleged that he had been denied employment with a private company because the company's contract with the FAA prohibited the company from hiring former FAA employees who had participated in the strike against the government. Clarry claimed that the FAA's policy of requiring parties that it contracted with not to employ the strikers violated his right to due process and equal protection. Clarry sought declaratory, injunctive, and monetary relief.On August 12, 1993, President Clinton issued a memorandum to the Director of OPM ("President Clinton's Directive"), in which the President stated that he was repealing the bar against employment of the strikers. OPM responded by issuing a bulletin declaring that the strikers would no longer be barred from employment with the FAA or any private entity under contract with the FAA. See Federal Personnel Manual Bulletin 731-10.By motion dated March 30, 1994, Clarry moved in the district court for leave to file an amended complaint. The amended complaint added Bailey, Faulkner, McCollum, and Robertson as plaintiffs and James B. King, as Director of OPM, as a defendant. In the amended complaint, Clarry alleged that, in 1991, he applied for and was denied a position with a company because the company's contract with the FAA prohibited it from hiring any of the strikers. In addition, each plaintiff alleged that he had applied to the FAA for reinstatement as an air traffic controller but was denied a suitability determination by OPM. The plaintiffs alleged four causes of action in the amended complaint. First, the plaintiffs claimed that OPM's policy of barring the strikers from employment with the FAA for an indefinite period violated their right to due process. Second, the plaintiffs alleged that OPM's policy of barring the strikers from employment with the FAA for an indefinite period violated OPM's existing regulations and therefore deprived them of their due process rights. Third, the plaintiffs claimed that OPM failed to comply with the APA's notice and comment rulemaking procedures in implementing the policy. Finally, the plaintiffs alleged that the FAA's practice of inserting in all its contracts with private companies a prohibition against the employment of the strikers violated the Due Process Clause of the Fifth Amendment.On November 18, 1994, the district court granted Clarry's motion to amend the original complaint, but indicated that it would consider both the original complaint and the amended complaint when addressing the government's motion to dismiss. On July 5, 1995, the district court granted the government's motion to dismiss the original complaint and the amended complaint pursuant to Fed.R.Civ.P. 12(b)(6). The district court found that the plaintiffs did not have a property interest protected by the Fifth Amendment, and therefore that OPM's policy did not violate the plaintiffs' due process rights. In addition, the district court determined that OPM's policy did not violate the APA. Finally, the district court found that the plaintiffs did not have standing to pursue their claim that the FAA's policy of inserting in its contracts with private entities a prohibition against the employment of the strikers violated their due process rights. The plaintiffs appealed, challenging the district court's dismissal of the amended complaint.DISCUSSIONThe district court's dismissal of a complaint pursuant to Fed.R.Civ.P. 12(b)(6) is reviewed de novo by this Court. Christ Gatzonis Elec. Contractor, Inc. v. New York City Sch. Constr. Auth., 23 F.3d 636, 639 (2d Cir.1994). In reviewing such a dismissal, we must accept the material facts alleged in the complaint as true, and dismiss only where the plaintiffs can prove no set of facts in support of their claim that would entitle them to relief. Staron v. McDonald's Corp., 51 F.3d 353, 355 (2d Cir.1995).I. Indefinite Bar on Employment with the FAAThe plaintiffs' first claim is that the policy of OPM that barred the strikers for an indefinite period from employment with the FAA deprived them of a protected property interest without due process. In connection with this claim, the plaintiffs argue that 5 U.S.C. 7311 does not provide an indefinite bar on employment for a federal employee who strikes against the government. The plaintiffs further argue that OPM incorrectly interpreted President Reagan's Directive as imposing an indefinite bar on employment with the FAA, when, in fact, the Directive imposed only a three-year bar. Finally, the plaintiffs argue that 5 C.F.R. § 731.303 conferred upon them a constitutionally protected property interest in the right to reemployment with the FAA between 1984 and 1993, when President Clinton's Directive was issued. We reject each of these contentions and hold that the district court properly dismissed the plaintiffs' claim.First, Congress made it clear that any person who participates in a strike against the federal government has no right to federal employment. Section 7311 explicitly provides that "[a]n individual may not accept or hold a position in the Government of the United States ... if he ... participates in a strike, or asserts the right to strike, against the Government of the United States." This language unambiguously provides an absolute bar on employment without any temporal limitation. As the Federal Circuit held, "[t]he conclusion is inescapable that Congress meant exactly what it said [in § 7311]--that persons who participated in a strike against the government are barred indefinitely from employment in the government." Wagner v. Office of Personnel Management, 783 F.2d 1042, 1046 (Fed.Cir.), cert. denied,Try vLex for FREE for 3 days
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