Lissy Pentzke v. Department of the Treasury ( 2024 )

UNITED STATES OF AMERICA
MERIT SYSTEMS PROTECTION BOARD
LISSY G. PENTZKE, DOCKET NUMBER
Appellant, AT-0432-18-0439-I-1
v.
DEPARTMENT OF THE TREASURY, DATE: March 14, 2024
Agency.
THIS ORDER IS NONPRECEDENTIAL 1
Stephanie Bernstein , Esquire, and Tyler Sroufe , Esquire, Dallas, Texas, for
the appellant.
Lisa Pyle , Esquire, Washington, D.C., for the agency.
BEFORE
Cathy A. Harris, Vice Chairman
Raymond A. Limon, Member
REMAND ORDER
¶1 The appellant has filed a petition for review of the initial decision, which
affirmed her removal for unacceptable performance pursuant to 5 U.S.C.
chapter 43. For the reasons discussed below, we GRANT the appellant’s petition
for review, VACATE the initial decision, and REMAND the case to the regional
office for further adjudication in accordance with this Remand Order and
1
A nonprecedential order is one that the Board has determined does not add
significantly to the body of MSPB case law. Parties may cite nonprecedential orders,
but such orders have no precedential value; the Board and administrative judges are not
required to follow or distinguish them in any future decisions. In contrast, a
precedential decision issued as an Opinion and Order has been identified by the Board
as significantly contributing to the Board’s case law. See 5 C.F.R. § 1201.117(c).
2
Santos v. National Aeronautics and Space Administration, 990 F.3d 1355 (Fed.
Cir. 2021).
DISCUSSION OF ARGUMENTS ON REVIEW
¶2 In Santos, 990 F.3d at 1360-63, the U.S. Court of Appeals for the Federal
Circuit held for the first time that, in addition to the elements of a chapter 43 case
set forth by the administrative judge and discussed below, an agency must also
show that the initiation of a performance improvement plan (PIP) was justified by
the appellant’s unacceptable performance before the PIP. Id. Prior to addressing
the remand, however, we address the appellant’s arguments on review concerning
the administrative judge’s findings on the elements of a chapter 43 appeal as they
existed at the time of the initial decision.
The administrative judge properly found that the agency proved its chapter 43
removal action under pre- Santos law.
¶3 At the time the initial decision was issued, the Board’s case law stated that,
in a performance-based action under 5 U.S.C. chapter 43, an agency must
establish the following by substantial evidence 2 : (1) the Office of Personnel
Management approved its performance appraisal system and any significant
changes thereto; (2) the agency communicated to the appellant the performance
standards and critical elements of her position at the beginning of the appraisal
period; (3) the appellant’s performance standards are valid under 5 U.S.C.
§ 4302(b)(1); (4) the agency warned the appellant of the inadequacies of her
performance during the appraisal period and gave her a reasonable opportunity to
demonstrate acceptable performance; and (5) the appellant’s performance
remained unacceptable in one or more of the critical elements for which she was
provided an opportunity to demonstrate acceptable performance. See 5 U.S.C.
2
The agency’s burden of proof in an action taken under chapter 43 is “substantial
evidence,” defined as the degree of relevant evidence that a reasonable person,
considering the record as a whole, might accept as adequate to support a conclusion,
even though other reasonable persons might disagree. 5 C.F.R. § 1201.4(p). This is a
lower burden than preponderant evidence.
3
§§ 4302(b), 7701(c)(1)(A); Lee v. Environmental Protection Agency,
115 M.S.P.R. 533, ¶ 5 (2010).
¶4 On petition for review, the appellant largely reargues her case without
identifying specific errors in the initial decision. For example, she repeatedly
contends that the administrative judge ignored evidence, including her oral reply,
affidavits, exhibits, deposition, close of record submission, rebuttal, and
pleadings. Petition for Review (PFR) File, Tab 1 at 8, 12, 17-19, 31. However,
she fails to cite to specific evidence and explain its relevance or how it would
alter the outcome of the appeal. To the extent the appellant does not identify
specific errors in the administrative judge’s analysis, the Board will not embark
upon a complete review of the record. See Baney v. Department of Justice,
109 M.S.P.R. 242, ¶ 7 (2008); Tines v. Department of the Air Force, 56 M.S.P.R.
90, 92 (1992); 5 C.F.R. § 1201.115(a)(2) (stating that a petitioner who alleges
that the administrative judge made erroneous findings of material fact must
explain why the challenged factual determination is incorrect and identify
specific evidence in the record that demonstrates the error); see also Keefer v.
Department of Agriculture, 92 M.S.P.R. 476, ¶ 18 n.2 (2002) (stating that it is not
the Board’s obligation to pore through the record to construe and make sense of
allegations set forth at various parts of a voluminous case file and the appellant is
required to articulate her claims with reasonable clarity and precision).
Nonetheless, we address those issues and findings regarding which the appellant
has presented specific arguments on review.
¶5 The appellant argues that the administrative judge erred in finding that the
agency’s performance standards were valid because she contends that they are
vague, ambiguous, and subjective. PFR File, Tab 1 at 9-10. However, the
administrative judge acknowledged that the agency’s performance standards were
somewhat subjective; but she found that they were not impermissibly vague in
light of the appellant’s position as an Investigator, which she determined could
not be assessed using a mechanical or quantitative formula but rather necessarily
4
involved a degree of subjective professional judgment. Initial Appeal File (IAF),
Tab 35, Initial Decision (ID) at 7. 3
¶6 Moreover, the administrative judge further found that the agency’s PIP
along with the feedback that the appellant’s supervisor provided to her during the
PIP meetings cured any deficiency by fleshing out the required standards. ID
at 8. We discern no error in the administrative judge’s analysis. See, e.g.,
Salmon v. Social Security Administration, 663 F.3d 1378, 1381-82 (Fed. Cir.
2011) (finding that the agency’s performance standards of demonstrates job
knowledge and achieves business results, as fleshed out by the appellant’s
supervisor’s direct and precise feedback regarding the deficiencies in the
appellant’s work and how to remedy such deficiencies, were sufficiently
objective); Greer v. Department of the Army, 79 M.S.P.R. 477, 484 (1998)
(finding that a reasonable person could find that the appellant’s performance
standards were valid considering the scientific expertise required and the
independence and discretion he had in carrying out his work and that any lack of
specificity was cured because the agency continually gave the appellant
3
The appellant also argues that her performance standards were invalid because, similar
to the standards in Van Prichard v. Department of Defense, 117 M.S.P.R. 88 (2011),
aff’d, 484 F. App’x 489 (Fed. Cir. 2012), they failed to define the minimum level of
performance required to avoid removal. PFR File, Tab 1 at 9. However, we find
Van Prichard distinguishable. In Van Prichard, the agency’s performance standards
failed to define the levels of performance for each critical element and only defined
Marginal performance in a general definitions section as performance that is “less than
Fully Successful and supervisory guidance and assistance is more than normally
required.” Van Prichard, 117 M.S.P.R. 88, ¶ 17. The Board found that the Marginal
performance standard was an invalid backwards standard because it described what the
appellant should not do instead of what was required to obtain an acceptable level of
performance. Id., ¶ 18. In contrast, here, the agency’s performance plan defines
minimally satisfactory performance as performance “between the levels described for
Fully Successful and Unacceptable” and also defines the levels of performance for each
critical element at the Outstanding, Fully Successful, and Unacceptable levels. IAF,
Tab 10 at 44, 47, 50. Thus, we find that the agency’s standard is not an invalid
backwards standard. Nor does the agency’s minimally satisfactory performance
standard improperly require extrapolation more than one level above and below which
there is a written standard. PFR File, Tab 1 at 9; see, e.g., Donaldson v. Department of
Labor, 27 M.S.P.R. 293, 297-98 (1985).
5
comments on his work assignments during the PIP); Melnick v. Department of
Housing and Urban Development, 42 M.S.P.R. 93, 99 (1989) (stating that the fact
that a performance standard may call for a certain amount of subjective judgment
on the part of the employee’s supervisor does not automatically invalidate it),
aff’d, 899 F.2d 1228 (Fed. Cir. 1990) (Table); Donaldson v. Department of Labor,
27 M.S.P.R. 293, 301-02 (1985) (finding that the work of a GS-12 coal mine
inspector who performed a wide range of independent investigations could not be
measured by mechanical standards, but rather required subjective judgment by the
appellant’s supervisor on the appropriateness of the appellant’s actions). Thus,
we find that the appellant’s arguments on review fail to establish any error in the
administrative judge’s findings.
The administrative judge properly found that the appellant failed to prove that she
made protected disclosures in August 2015.
¶7 Regarding her affirmative defense of whistleblower reprisal, the appellant
alleged that, in August 2015, she disclosed to her supervisor that (1) another
investigator told her that there was no need for two companies that she was
investigating to obtain wholesaler’s basic permits, a determination with which the
appellant disagreed, and (2) her supervisor denied her request for a cease and
desist letter to be issued to the two companies to instruct them not to sell alcohol
without a permit. IAF, Tab 27 at 32-34. On review, the appellant argues that the
administrative judge erred in finding that she failed to prove that she reasonably
believed that she was disclosing a violation of a law, rule, or regulation because
she identified a specific law, 27 U.S.C. § 203. PFR File, Tab 1 at 19-22.
However, the administrative judge did not find that the appellant failed to identify
a specific law. Rather, as set forth below, she found that the appellant failed to
prove that she reasonably believed she was disclosing a violation of a law, rule,
or regulation. ID at 14. On review, the appellant has not established any error in
the administrative judge’s finding.
6
¶8 The appellant’s description of the events surrounding the investigation of
the two companies as well as her alleged disclosures to her supervisor concerning
her disagreement with the other investigator regarding permitting requirements
lack sufficient detail and clarity. IAF, Tab 27 at 45-54. For example, the
appellant states that she called her supervisor regarding an email from the other
investigator, which the appellant considered to provide “partially false and
misleading information” about permit regulations. Id. at 48. However, she fails
to describe in any detail what she disclosed to her supervisor. Thus, she has not
established by preponderant evidence that she reasonably believed she was
disclosing one of the categories of wrongdoing set forth in 5 U.S.C. § 2302(b)(8).
¶9 Even assuming the appellant reasonably believed she was disclosing that the
two companies were operating without a permit in violation of 27 U.S.C. § 203(a)
and (c), such a disclosure does not amount to a protected disclosure because it
fails to implicate Government wrongdoing. See Aviles v. Merit Systems
Protection Board, 799 F.3d 457, 463-66 (5th Cir. 2015); Arauz v. Department of
Justice, 89 M.S.P.R. 529, ¶¶ 6-7 (2001); cf. Covington v. Department of the
Interior, 2023 MSPB 5, ¶¶ 20-31 (finding that the appellant’s disclosures
regarding the Navajo Nation’s activities implicated the Government’s interests
and good name based on the unique relationship between the agency and the
Navajo Nation in which the agency had fiduciary duty and statutory trust
responsibility to oversee Indian forest lands).
¶10 Additionally, to the extent the appellant alleges that she reasonably believed
that the other investigator and/or her supervisor were concealing potential
smuggling or other illegal activity because she faced “adamant opposition” during
the investigation that was “suspicious,” IAF, Tab 27 at 35, we find that she has
not alleged facts sufficient to show by preponderant evidence that she had a
reasonable belief that the Government was implicated in any wrongdoing, see,
e.g., Aviles, 799 F.3d at 466-67 (finding that the appellant’s vague and conclusory
allegations of a Government “cover up” of alleged tax fraud by Exxon alone were
7
insufficient to establish even a nonfrivolous allegation of a protected disclosure).
Rather, the appellant’s alleged disclosures amount to her disagreement concerning
the application of the permitting requirements to the facts of the two
investigations. See, e.g., 5 U.S.C. § 2302(a)(2)(D) (communications concerning
policy decisions that lawfully exercise discretionary authority are not protected
unless they separately constitute a protected disclosure of one of the categories of
wrongdoing listed in section 2302(b)(8)(A)); IAF, Tab 27 at 52 (affidavit of the
appellant) (stating that ultimately it was within her supervisor’s discretion
whether to issue the permits).
On remand, the administrative judge shall reconsider whether the appellant’s
protected activity was a contributing factor in her removal.
¶11 To establish her prima facie case of whistleblower reprisal, the appellant
must prove that a protected disclosure or activity was a contributing factor in a
personnel action taken against her. Skarada v. Department of Veterans Affairs ,
2022 MSPB 17, ¶ 6 (2022). One way to prove contributing factor is by the
knowledge/timing test under which an appellant may show that her protected
disclosure or activity was a contributing factor in a personnel action through
circumstantial evidence, such as evidence that (1) the official taking the personnel
action knew of the disclosure or activity; and (2) the personnel action occurred
within a period of time such that a reasonable person could conclude that the
disclosure or activity was a contributing factor in the personnel action. 5 U.S.C.
§ 1221(e)(1); Smith v. Department of the Army, 2022 MSPB 4, ¶ 19.
¶12 The appellant alleged that in May 2017, she reported to the agency’s Office
of the Inspector General (OIG) the issues described in disclosures 1 and 2 above. 4
IAF, Tab 27 at 35, 53. Although a disclosure to the OIG constitutes protected
activity under 5 U.S.C. § 2302(b)(9)(C), the administrative judge found that the
appellant failed to prove that her protected activity was a contributing factor in
4
The initial decision incorrectly states the appellant’s OIG report occurred in
May 2016, ID at 12, when the appellant alleged that it occurred in May 2017, IAF,
Tab 27 at 35, 53.
8
her removal because she failed to show that her supervisor, who was the
proposing official, was aware that she had filed an OIG complaint. ID at 14. On
review, the appellant asserts that the administrative judge erred because the
agency admitted that her supervisor was aware of three grievances she filed,
including a May 19, 2017 grievance. PFR file, Tab 1 at 23-24; IAF, Tab 30 at 27.
However, it is unclear whether this refers to the appellant’s disclosure to the OIG
in May 2017. In her sworn declaration, the appellant’s supervisor stated that she
was not aware of the appellant’s OIG complaint at the time she rated the appellant
unacceptable in her midyear performance review, which led to the appellant’s
placement on the PIP and ultimately her removal. IAF, Tab 26 at 16.
¶13 However, it is the agency, not its individual officials, from whom an
appellant seeks corrective action, and actual knowledge by a single official is not
dispositive. See Dorney v. Department of the Army, 117 M.S.P.R. 480, ¶ 14
(2012). In addition to the knowledge/timing test, there are other possible ways
for an appellant to satisfy the contributing factor standard. See id. Thus, the
Board has held that, if an administrative judge determines that an appellant has
failed to satisfy the knowledge/timing test, she shall consider other evidence,
such as evidence pertaining to the strength or weakness of the agency’s reasons
for taking the personnel action, whether the whistleblowing was personally
directed at the proposing or deciding officials, and whether they had a desire or
motive to retaliate against the appellant. Id., ¶ 15. Accordingly, on remand, the
administrative judge shall apply the factors set forth in Dorney as well as
consider any other evidence that may be relevant to a contributing factor
determination. If the administrative judge finds that the appellant met her burden
of proving contributing factor, she shall address whether the agency met its
burden of proving, by clear and convincing evidence, that it would have taken the
same personnel action in the absence of the appellant’s protected activity.
5 U.S.C. § 1221(e)(2); Karnes v. Department of Justice, 2023 MSPB 12, ¶ 23.
9
The administrative judge properly found that the appellant failed to prove her
affirmative defenses of due process violations and harmful procedural error.
¶14 On review, the appellant argues that the administrative judge erred in
finding that she failed to timely raise her affirmative defenses of due process
violations and harmful procedural error. PFR File, Tab 1 at 6. However, any
such error does not provide a basis for reversal because the administrative judge
also found that the appellant failed to prove her claims. See Panter v.
Department of the Air Force, 22 M.S.P.R. 281, 282 (1984) (finding that an
adjudicatory error that is not prejudicial to a party’s substantive rights provides
no basis for reversal of an initial decision). In particular, the administrative judge
found that the appellant was provided the materials relied upon by the agency and
she was allowed a reasonable opportunity to review such materials before
presenting her reply. ID at 12 n.11. We discern no error in the administrative
judge’s conclusion. The record reflects that the agency proposed the appellant’s
removal on January 9, 2018, and allowed her 21 days to respond to the proposal,
orally and in writing. IAF, Tab 10 at 307, 333. However, the deadline was
extended, and the appellant responded on March 8, 2018. Id. at 373. Moreover,
the appellant acknowledges in her affidavit that, once the agency resolved her
technical difficulties in accessing the materials relied upon, she had 7 days to
review the materials and prepare her oral and written reply. IAF, Tab 27 at 62;
see 5 U.S.C. § 7513(b)(2).
Remand is required under Santos .
¶15 Although the appellant has identified no basis for us to disturb the
administrative judge’s findings below that the agency proved its
performance-based action under pre-Santos law, we nonetheless must remand the
appeal. During the pendency of the petition for review in this case, the Federal
Circuit held in Santos, 990 F.3d at 1360-61, that, in addition to the five elements
of the agency’s case set forth in the initial decision, the agency must also justify
the institution of a PIP by proving by substantial evidence that the employee’s
10
performance was unacceptable prior to the PIP. The Federal Circuit’s decision in
Santos applies to all pending cases, including this one, regardless of when the
events took place. Lee v. Department of Veterans Affairs, 2022 MSPB 11, ¶ 16.
Although the record in this appeal already contains evidence suggesting that the
appellant’s performance leading up to the PIP was indeed unacceptable, we
remand the appeal to give the parties the opportunity to present argument and
additional evidence on whether the appellant’s performance during the period
leading up to the PIP was unacceptable in one or more critical elements. See Lee,
2022 MSPB 11, ¶¶ 15-17. On remand, the administrative judge shall accept
argument and evidence on this issue and shall hold a supplemental hearing if
appropriate. Id., ¶ 17.
¶16 The administrative judge shall then issue a new initial decision consistent
with Santos. See id. If the agency makes the additional showing required under
Santos on remand that the appellant’s performance in at least one critical element
was at an unacceptable level prior to her placement on the PIP, the administrative
judge may incorporate her prior findings and the Board’s findings here on the
other elements of the agency’s case and the appellant’s affirmative defenses in
the remand initial decision. See id. Regardless of whether the agency meets its
burden, if the argument or evidence on remand regarding the appellant’s pre-PIP
performance affects the administrative judge’s analysis of the appellant’s
affirmative defenses, she should address such argument or evidence in the remand
initial decision. See Spithaler v. Office of Personnel Management , 1 M.S.P.R.
587, 589 (1980) (explaining that an initial decision must identify all material
issues of fact and law, summarize the evidence, resolve issues of credibility, and
include the administrative judge’s conclusions of law and his legal reasoning, as
well as the authorities on which that reasoning rests).
11
ORDER
¶17 For the reasons discussed above, we grant the appellant’s petition for
review and remand this case to the regional office for further adjudication in
accordance with this Remand Order.
FOR THE BOARD: ______________________________
Gina K. Grippando
Clerk of the Board
Washington, D.C.