Markham v. United States

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
JAMES MARKHAM, and as to the 
third claim, on behalf of others
similarly situated,
Plaintiff-Appellant,
v.
No. 04-15616
UNITED STATES OF AMERICA; ELAINE
CHAO, as Secretary of Labor; U.S.  D.C. No.
CV-03-00257-SOM
DEPARTMENT OF LABOR; JANE DOE;
JOHN DOE, 2-10; DOE PARTNERSHIPS OPINION
1-10; DOE ENTITIES 1-10; MELANIE
GALEN; TWO UNKNOWN OWCP
CLAIMS EXAMINERS; TWO UNKNOWN
OWCP NURSES,
Defendants-Appellees.

Appeal from the United States District Court
for the District of Hawaii
Susan Oki Mollway, District Judge, Presiding
Submitted November 22, 2005*
Honolulu, Hawaii
Filed January 17, 2006
Before: Michael Daly Hawkins, M. Margaret McKeown, and
Richard R. Clifton, Circuit Judges.
Opinion by Judge McKeown
*This panel unanimously finds this case suitable for decision without
oral argument. See Fed. R. App. P. 34(a)(2).
757
MARKHAM v. UNITED STATES 759
COUNSEL
Stephen M. Shaw, Honolulu, Hawaii, for the appellant.
Edward H. Kubo, Jr., United States Attorney, and Thomas A.
Helper, Assistant United States Attorney, United States
Department of Justice, District of Hawaii, Honolulu, Hawaii,
for the appellees.
760 MARKHAM v. UNITED STATES
OPINION
McKEOWN, Circuit Judge:
In this appeal we consider whether the district court lacked
subject matter jurisdiction over James Markham’s complaint
alleging constitutional violations in the handling of his injury
claim by the Office of Workers’ Compensation Programs of
the United States Department of Labor (“OWCP”). Markham
launches a broad indictment against various policies of the
agency, labeling its practices a “campaign of terror.” Rhetoric
cannot, however, transform an unreviewable administrative
practice into a constitutional violation. This case presents a
clear example of a litigant making wholly insubstantial consti-
tutional allegations to frame otherwise unreviewable adminis-
trative decisions. We affirm the district court’s dismissal of
Markham’s complaint.
BACKGROUND
Markham filed a Federal Employee’s Compensation Act
(“FECA”) claim after he was injured while serving as an elec-
trician with the U.S. Department of the Navy. OWCP
accepted Markham’s claim and authorized continued compen-
sation and medical benefits. A few weeks later, OWCP noti-
fied Markham that he was required to undergo vocational
rehabilitation at the direction of OWCP, absent a good reason
for not doing so.1 The letter advised that a nurse had left
Markham numerous unreturned voice mail messages trying to
set up a time and place to meet and discuss his vocational
rehabilitation. The letter warned Markham that if he contin-
ued to not cooperate with the nurse without good cause,
OWCP would reduce his compensation benefits to zero pursu-
ant to 5 U.S.C. § 8113(b) and 20 C.F.R. § 10.519.2 In conclu-
1
Under 5 U.S.C. § 8104, OWCP has the discretion to direct an
employee making a FECA claim to undergo vocational rehabilitation.
2
Section 8113(b) provides:
If an individual without good cause fails to apply for and undergo
MARKHAM v. UNITED STATES 761
sion, Markham was warned that a reduction in compensation
benefits would continue until he complied in good faith with
OWCP’s vocational rehabilitation efforts.
The letter had its intended effect. Shortly after receiving it,
Markham cooperated with the nurse and OWCP and began
receiving benefits. OWCP informed him that it would not take
action or reduce his benefits for his initial non-cooperation.
Markham concedes that he has received all benefits owed
him.
Taking great offense to the threat of reduced benefits,
Markham filed suit against the Department of Labor, the Sec-
retary of Labor (“Secretary”), OWCP, and various individuals
within OWCP. Markham alleged that he was denied due pro-
cess through OWCP’s “campaign of terror,” which resulted in
a threat to reduce compensation benefits without adequate
pre-deprivation notice or a meaningful opportunity to be
heard.
Markham also alleged a litany of due process violations in
various other OWCP administrative practices and customer
service facilities. For example, Markham claimed that OWCP
violates the Constitution by: failing to maintain a claims
office in his home state of Hawaii; requiring that beneficiaries
participate in telephone conferences with multiple parties in
different time zones; using a Kentucky address and San Fran-
vocational rehabilitation when so directed under section 8104 of
this title, the Secretary [of Labor], on review under section 8128
of this title and after finding that in the absence of the failure the
wage-earning capacity of the individual would probably have
substantially increased, may reduce prospectively the monetary
compensation of the individual in accordance with what would
probably have been his wage-earning capacity in the absence of
the failure, until the individual in good faith complies with the
direction of the Secretary.
Sections 10.519(b) and (c) are similar in scope.
762 MARKHAM v. UNITED STATES
cisco telephone number for notices and correspondence with
beneficiaries in Hawaii; using nurses who lack contact infor-
mation beyond voice mail; delegating authority to nurses and
retaining employees whom he regards as unqualified; and
using misleading non-cooperation letters.
To remedy these supposed constitutional violations, Mark-
ham seeks an injunction against these practices and a broad
declaratory judgment “that all statutes, codes[,] proceedings,
practice[s], and agency common-law authorizing administra-
tive remedies by the OWCP are inadequate, unconstitutional
and void.”
The district court dismissed Markham’s complaint pursuant
to Federal Rule of Civil Procedure 12(b)(1) for lack of subject
matter jurisdiction under 5 U.S.C. § 8128(b), stating that
“Markham raised wholly insubstantial constitutional chal-
lenges.” We review de novo the district court’s dismissal for
lack of subject matter jurisdiction. Federal Deposit Ins. Corp.
v. Nichols, 885 F.2d 633, 635 (9th Cir. 1989).
DISCUSSION
[1] FECA establishes a comprehensive and exclusive work-
ers’ compensation scheme for federal employees. The Act
provides that “[t]he United States shall pay compensation . . .
for the disability or death of an employee resulting from per-
sonal injury sustained while in the performance of his duty
. . . .” 5 U.S.C. § 8102(a). The Secretary has the authority to
administer and decide all questions under FECA, 5 U.S.C.
§ 8145, and may formulate rules and regulations necessary to
administer the Act, 5 U.S.C. § 8149.
[2] Section 8128(b) explicitly provides that the courts do
not have jurisdiction to review FECA claims challenging the
merits of benefit determinations:
The action of the Secretary or his designee in allow-
ing or denying a payment under this subchapter is —
MARKHAM v. UNITED STATES 763
(1) final and conclusive for all purposes and with
respect to all questions of law and fact; and
(2) not subject to review by another official of the
United States or by a court by mandamus or
otherwise.
5 U.S.C. § 8128(b); see Staacke v. United States Sec’y of
Labor, 841 F.2d 278, 281 (9th Cir. 1988).
[3] The courts have fashioned two narrow exceptions to
this absolute jurisdictional bar. Courts retain jurisdiction to
consider constitutional challenges or claims for violation of a
clear statutory mandate or prohibition. Staacke, 841 F.2d at
281; see Rodrigues v. Donovan, 769 F.2d 1344, 1347-48 (9th
Cir. 1985).
[4] Markham’s first claim is that his benefits were denied
without notice, at least as to the period of his non-cooperation.
Besides his own declaration, the only thing that Markham
cites to support this allegation is the OWCP non-cooperation
letter. This letter does not help Markham, however, because
the plain language of the letter provides notice only of a
potential reduction of benefits if Markham did not comply
with the unambiguous instructions of the letter. The letter was
in fact notice of the intended action in the event Markham did
not cooperate. Although Markham was never denied benefits,
any such challenge is precluded by § 8128(b).
[5] Recognizing this bar, Markham tries to transform a
garden-variety administrative action into a case of constitu-
tional magnitude. Even assuming there was a transitory denial
of benefits for the period of non-cooperation, Markham does
not claim he was entitled to any specific benefits during this
gap of less than two weeks. And any potentially imprudent
denial of benefits was corrected when Markham complied
with OWCP’s rehabilitation requirements. A cognizable due
process claim must be more than an ephemeral and insubstan-
764 MARKHAM v. UNITED STATES
tial denial of benefits to which a plaintiff does not claim enti-
tlement. See Czerkies v. U.S. Dept. of Labor, 73 F.3d 1435,
1443 (7th Cir. 1996) (en banc) (“The government does not
violate the Constitution every time it mistakenly denies a
claim for benefits. . . . This is a case of a claim for benefits
‘cloaked in constitutional terms.’ Czerkies has affixed the
constitutional label to a garden-variety claim for benefits
plainly barred by 5 U.S.C. § 8128(b).”); Raditch v. United
States, 929 F.2d 478, 481 (9th Cir. 1991) (“A violation of pro-
cedural rights requires only a procedural correction, not the
reinstatement of a substantive right to which the claimant may
not be entitled on the merits.”)
[6] Nor did the district court have jurisdiction under
§ 8128(b) to review Markham’s remaining laundry list of due
process claims. FECA vests the Secretary (and hence OWCP)
with the authority to “administer, and decide all questions
arising under, [FECA].” 5 U.S.C. § 8145. As such, the Secre-
tary’s discretion to make policy choices under FECA is “vir-
tually limitless.” Staacke, 841 F.2d at 282.
[7] Despite being expressed in constitutional terms, Mark-
ham’s challenges to the administration of FECA claims
involve questions of claims processing and customer service,
not questions of due process. His effort to hitch these alleged
inadequacies to a constitutional star is unavailing. Pure policy
decisions concerning the administration of FECA are entirely
within the discretion of the Secretary. Although in certain
instances an administrative procedure can give rise to a due
process violation, see Rodrigues, 769 F.2d at 1348, it is the
due process violation and not the administrative procedure
that forms a basis for jurisdiction.
Nor can these claims be saved by Markham’s complaint
that even if the last notice of potential termination never came
to fruition, as a consequence of OWCP policies and proce-
dures, he is constantly at risk for a future termination. Apart
from the rank speculation inherent in this argument, Markham
MARKHAM v. UNITED STATES 765
has suffered no injury. “[T]he ‘injury in fact’ test requires
more than an injury to a cognizable interest. It requires that
the party seeking review be himself among the injured.”
Sierra Club v. Morton, 405 U.S. 727, 734-35 (1972).
To be sure, it can be frustrating to penetrate a telephone
system where the customer is relegated to voice mail. From
Markham’s standpoint, in a perfect world, he would be able
to meet with nurses at a local office in Hawaii. But these pur-
ported inconveniences, which he labels a “campaign of terror”
and a “modern system of slavery,” do not even remotely rise
to the level of cognizable constitutional claims.
[8] Markham’s alleged constitutional violations are simply
a disagreement with the Secretary’s administrative structure
and claims process. Sprinkling the brief with multiple due
process references and affixing a constitutional label does not
change the essence of the claims. Markham’s purported con-
stitutional claims are wholly insubstantial, rendering the fed-
eral courts without subject matter jurisdiction.
AFFIRMED.