Whistleblower Gets a Win in Court

A financial economist complained that her supervisor took adverse personnel actions against her in retaliation for whistleblowing. The administrative judge and the MSPB blew off the allegations but a federal court sends the case back to the Board. It found, among other things, that the Board erred in holding that an action that never actually occurred cannot serve as the basis for a protected disclosure.

A financial economist in the Federal Transit Administration won her court appeal challenging the Merit Systems Protection Board’s dismissal of her whistleblower individual right of action. The court has reversed and remanded to the Board for further processing. (Reid v. Merit Systems Protection Board and Department of Transportation, C.A.F.C. No. 2007-3056, 11/19/07)

Reid’s problems at FTA began after she was detailed to work for the Budget Director, Kristin Clarke. Reid charges that Clarke instructed her to prepare a statement of work and procurement for a managerial cost accounting project in order to justify a sole source contract to a large business. Reid informed Clarke, as well as Reid’s regular and second level supervisors that a sole source contract under the circumstances would violate Federal Acquisition Regulations. (Opinion p. 2)

Reid claims that when she returned to her position, her regular supervisor took adverse personnel actions against her—namely, loss of her telecommuting privileges and refusal to accommodate an unspecified disability. She claims that this was in retaliation for her whistleblowing. (pp. 3-4)

Reid took her complaint to the MSPB. However, the Administrative Judge dismissed her appeal without a hearing for failure to make nonfrivolous allegations so as to establish Board jurisdiction. The AJ concluded that Reid had made her disclosures to officials not in a position to remedy them; that since the sole source procurement never took place Reid could not have believed that her disclosure evidenced a violation; and Reid had failed to tie the disclosure to a covered personnel action. The full Board declined to review the AJ’s dismissal and Reid took her case to court. (p. 3)

The Federal Circuit rules that the Board erred in holding that an action that never actually occurred cannot serve as the basis for a protected disclosure, stating: “…[A] cramped reading of the statute to exclude potential violations not carried out would be counter to [Congress’] intent.” (pp. 4-5) However, the court goes to pains to temper this: “[W]e do not intend to convey the idea that any mere thought, suggestion, or discussion of an action that someone might consider to be a violation of a law, rule, or regulation is a justification for a whistleblower complaint….The determination depends on the facts.” (pp. 5-6)

Next, the court rules that the Board also erred in its holding that alerting an “innocent” supervisor is insufficient to qualify as making a protected disclosure, pointing out that any supervisor can remedy a situation by going to a higher authority. (p. 6) Finally, making it three-for-three for Reid, the court disagrees with the AJ’s conclusion that she failed to tie her disclosure to a covered personnel action. The court rules that the Board was arbitrary: “Reid clearly has alleged facts sufficient, if true, to meet the prima facie standard, and it was contrary to law for the AJ to conclude otherwise.” (p. 7; citation omitted)

In short, the court has reversed the Board’s decision and remanded the case for further proceedings.

About the Author

Susan McGuire Smith spent most of her federal legal career with NASA, serving as Chief Counsel at Marshall Space Flight Center for 14 years. Her expertise is in government contracts, ethics, and personnel law.