STEWART v. MABUS

Filing 38

AMENDED MEMORANDUM OPINION (this amended document corrects typos in numbering of some headings only). Signed by Judge Gladys Kessler on 2/24/16. (CL)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA

ALEXANDER E. STEWART,
Plaintiff,
v.

Civil Action No. 15-576{GK)

RAY MABUS,
Defendant.

AMENDED MEMORANDUM OPINION

This is a sad case. A distinguished, award-winning doctor who
has served the Navy for more than 24 years, whose undergraduate
education,

medical studies,

and advanced medical education were

paid for by the United States Government, and who received regular
salary increases in exchange for agreeing to remain in the military
for a specific number of years, is suing the Government because it
miscalculated the years he was required to serve. Because of that
miscalculation,
signed

which the Government does not deny,

agreements

to

remain

with

the

Navy

until

the doctor
2015.

The

Government now claims that he must remain on active duty until
2018 -- a difference of three years.

****
Plaintiff
"Stewart")
Mabus

Captain

Alexander

E.

Stewart

("Plaintiff"

or

brings this action against Secretary of the Navy Ray

("Defendant,"

"the

Government,"

or

"the

Navy")

seeking

review of certain determinations by the Board for Correction of
Naval

Records

("the

Board")

regarding

the period of Stewart's

obligation to remain on active duty in the Navy in exchange for
substantial
Compl.

educational

and

financial

benefits.

See

generally

[Dkt. No. 1].

In exchange

for

Special

Pay offered to

naval

physicians,

Stewart executed several contracts, which, by their written terms,
extended his active duty obligation to the Navy to at least 2015.
When

the

Navy

discovered

that

the

service

obligation

dates

specified in the contracts had been miscalculated and failed to
account

for

pre-existing

service

obligations,

it

amended

its

records and the contracts with Stewart to reflect a later service
obligation date of 2018. Stewart petitioned the Board to reverse
these amendments, and the Board denied Stewart's request. Stewart
then appealed the Board's decision to this Court.
This matter is currently before the Court on the Government's
Motion

to

Judgment
Judgment

Dismiss
[Dkt.
[Dkt.

No.
No.

or,

in

12]

and Plaintiff's Cross Motion for Summary

16] .

the

For

Alternative,

the

reasons

Motion

that

for

Summary

follow,

the

Government's Motion to Dismiss shall be denied, the Government's
Motion for Summary Judgment shall be granted, and Plaintiff's Cross
Motion for Summary Judgment shall be denied.
-2-

I .

BACKGROUND

A. Factual Background1

1.

Stewart's Early Career

Captain Stewart has had a long and distinguished career in
the United States Navy. He has served for over twenty-four years
in

the

Navy's

numerous

awards

accomplishments.
Stewart's

Medical
for

Corps

See~,

career

a

physician

academic,

his

as

and

research,

has

and

received

professional

AR 117.

with

the

Navy

began

in

1987

when

he

matriculated at the United States Naval Academy ("USNA"). Stewart
graduated from the USNA in 1991 and, in exchange for his studies,
incurred

an

10 U.S.C.

§

obligation

to

6959(a); AR 6; Compl.

From 1991 to 1995,
Uniformed

serve

Services

in
~

the

Navy

for

five

years.

8.

Stewart attended medical school at the

University

of

Health

Sciences

("USUHS").

Because Stewart remained in school, he did not accrue credit toward
his

initial

five-year

service

obligation while

at

USUHS.

When

Because this matter is an appeal from final agency action, see
5 U.S.C.
§ 704,
the Court relies upon the
facts
in the
Administrative Record ("AR") [ Dkt. No. 32] before the Board when
it reached its decision, 5 U.S.C. § 706. IMS, P.C. v. Alvarez, 129
F.3d 618, 623 (D.C. Cir. 1997) ("If a court is to review an agency's
action fairly, it should have before it neither more nor less
information than did the agency when it made its decision.").
1

-3-

Stewart

graduated

from

USUHS

in

May

of

1995,

he

incurred

an

additional seven-year service obligation to the Navy to be served
consecutively with his existing five-year obligation.
§

2114 (c); AR 10;

Fontana v.

White,

334 F.3d 80,

86

10 U.S. C.
(D.C.

Cir.

2003).
Thus, upon receipt of his medical degree in 1995, Stewart had
a

12-year

service

obligation,

requiring

that

he

engage

in

qualifying service in the Navy until at least May of 2007. In other
words,

May

2007

constituted

Stewart's

approximate

obligated

service date ("OSD"), which is the time at which a service member
may

leave

active duty

in

the

Navy without

having

to

complete

additional required service or pay back money or other benefits
received from the Government.

See e.g.,

37 U.S.C.

§

302 (f)

("An

officer who does not complete the period for which the payment was
made under [relevant subsections] shall be subject to the repayment
provisions of section 303a(e) of [title 37] .").
From

1995

to

1996,

Stewart

completed

a

one-year

medical

internship, during which time his 12-year service obligation was
stayed. 10 U.S.C.
his

medical

§

2114(d). Accordingly, when Stewart completed

internship

in

1996,

-4-

his

twelve-year

obligation

remained,

committing him to remain in the Navy -- and extending

his OSD -- until at least 2008. 2
From 1996 to 1999, Stewart served as a flight surgeon, which
satisfied

three

years

of

his

12-year

active

duty

service

obligation. Upon completion of his tour of duty in 1999, Stewart
owed nine years of service, and his OSD remained at 2008.
From 1999 to 2004, Stewart completed a medical residency in
otolaryngology. This period of further training again stayed his
service

obligation

to

the

Navy.

10

U.S.C.

§

2114(d).

Upon

completion of the residency in 2004, Stewart still owed nine years
of service, and his OSD was moved up to 2013. 3

2·

The sources in the Administrative Record and the Parties' briefs
are generally not precise with respect to the exact date of
Stewart's OSD. They often state that the OSD falls in a particular
month in a particular year or simply state the year of the OSD.
Because resolution of this case does not require any more precision
than reference to a particular year, the Court follows the Record
and the Parties' practice.
3

Stewart did incur an additional service obligation by entering
the residency program; however, Department of Defense regulations
allow service members to fulfill obligations generated by medical
residencies conducted in military facilities concurrently with
obligations incurred by undergraduate studies and medical school.
Magnusson Deel. at <JI 7 [ Dkt. No. 12-3] (citing DODI 6000. 13
<JI 6.6.3.1). Accordingly, while Stewart's otolaryngology residency
stayed completion of the years of service he owed, it did not
extend his OSD.
-5-

2.

MSP Agreements

In July of 2004,
Special

Pay"

agreements

("MSP")

provide

Stewart applied for his first "Multi-Year
agreement

Navy

with

Medical

the

Corps

Navy.

AR

officers

45-46.
with

MSP

annual

lump-sum payments in addition to their normal pay in exchange for
the commitment to remain on active duty in the Navy for a specified
period of time.

See 37 U.S.C.

§

302.

Section 302 provides that

"[a]n officer may not be paid additional special pay

or

incentive special pay . . . for any twelve-month period unless the
officer first executes a written agreement under which the officer
agrees to remain on active duty for a period of not less than one
year beginning on the date the officer accepts the award of such
special pay." 37 U.S.C.

§

302(c) (1).

Stewart's first MSP request was for a two-year MSP agreement
effective July 27, 2004 ("the first MSP Agreement"). AR 45. In the
formal request that he executed, Stewart stated, "If my application
for MSP is approved, I agree to not tender a resignation or request
release from active duty that would be affected during this MSP
service obligation.

This obligation will be for a period of two

years beyond any existing active military service obligation for
education or training." AR 45 (emphasis in original). As described
above, as of July 2004, Stewart was already obligated to remain on

-6-

active duty for

at

least nine more

years

in exchange

extensive education and training he had received.

for

the

Since Stewart's

OSD was set at 2013 before he requested the first MSP agreement,
an additional two-year obligation in exchange for Special Pay would
have increased his OSD to 2015.
Unfortunately,

when

Stewart

requested

the

first

MSP

agreement, the Navy made a significant mistake in calculating his
OSD. That error was not discovered until nearly seven years later.
When the Navy calculated Stewart's OSD in response to the first
MSP request,

it neglected to include Stewart's five-year service

obligation incurred by his attendance at the USNA. AR 42.

Thus,

the Navy's OSD calculation worksheet mistakenly set Stewart's preMSP OSD at July 2008; two additional years yielded a post-MSP OSD
of July 31, 2010. Id.
This error was included in the first MSP agreement itself,
which states, "Pursuant to [cited authority],

[Stewart's first MSP

request] is approved for Otolaryngology, for two years, at $12,000
per year, effective 27 July 2004. [Stewart's] new obligated service
date, as computed on enclosure (2)

[the OSD calculation worksheet]

is July 2010." AR 40.
After having received one annual payment of $12,000 under the
first

MSP

agreement,

Stewart

decided

-7-

to

request

a

new

MSP

agreement. In a request dated November 8, 2004, Stewart requested
that his first MSP agreement be terminated in favor of a longer,
four-year MSP agreement

("the second MSP agreement")

attractive annual payments of $25, 000.
acknowledged that the "obligation
shall

be

for

a

period

of

request,

Stewart

[under the new MSP agreement]

4 years

military service obligation for

In his

with more

beyond

any

existing

active

education or training." AR 54.

Stewart also acknowledged that he would "repay the unearned portion
of [the July 2004] MSP contract[.]" Id.
Stewart's second MSP agreement was approved on December 10,
2004. AR 51. The second MSP agreement had a retroactive effective
date of October 1,
MSP

agreement

as

2004 and served to terminate Stewart's first
of

September

30,

2004.

Id.

In

calculating

Stewart's new OSD pursuant to the second MSP agreement, the Navy
again included its previous error. AR 56. Failing to account for
Stewart's

five-year

USNA

obligation,

the

Navy

set

Stewart's

pre-MSP OSD in July 2008, added two months for the period that the
first MSP agreement was in force,

and added an additional four

years to account for the second MSP agreement.

4

Id. 4 Accordingly,

The typed portion of the calculation table at AR 56 purports to
add three months for the period the first MSP agreement was in
force; however, the agreement appears to have been in force only
from July 27, 2004 to September 30, 2004 (i.e., just over two
months) . AR 56. That apparent arithmetic error appears to have
-8-

the second MSP agreement reflects a new OSD of "September 2012."
AR 51.
On October 20, 2005, Stewart requested a third MSP agreement
("the third MSP agreement")

with even more favorable terms than

the last: $33,000 per year in lump-sum payments for four years. AR
63.

In his

additional

request,
service

Stewart stated that he would undertake
obligation

"of

active military service obligation
AR 63.

As before,

4

years

for

beyond any

an

existing

education or training."

this third MSP agreement would terminate and

replace the then-existing second MSP agreement. Id.
On November 9,
was approved,

2005,

Stewart's third MSP agreement request

establishing the third MSP agreement.

third MSP agreement had a retroactive effective date of

AR 62.
~ctober

The
1,

2005 and terminated the second MSP agreement effective September
30, 2005. AR 62.
Again,

the Navy included its initial failure to account for

Stewart's five-year USNA service obligation. It set Stewart's OSD
prior to the second MSP agreement at September 30, 2008. 5 AR 69.

been corrected by hand and is not reflected in the MSP agreement
itself. AR 51, 56.
This OSD already included two months governed by the very first
MSP agreement executed in July of 2004.
5

-9-

The Navy then added one year to the OSD for the payment received
under the second MSP agreement and four years for the anticipated
payments under the newly executed third MSP agreement.

Id.

calculation yielded an OSD of September 2013,

which is

AR 69,

reflected in the third and final MSP agreement, AR 62.

3.
From
graduate

July

This

6

Rhinology Fellowship
2009

medical

to

July

education

2010,
("GME")

Stewart

participated

rhinology

in

fellowship.

a
By

participating in the program, Stewart incurred an additional oneyear

service

obligation.

This

obligation

was

to

be

served

consecutively with Stewart's -Obligations incurred by the Navy's

The Administrative Record shows that Stewart made efforts to
understand the implications of entering into each of the three MSP
agreements and posed several clarifying questions to Karen M.
Gaston, Assistant Program Director for Navy Medical Special Pays,
and Bill Marin, Director of Navy Medical Special Pays. AR 84-96.
Several e-mails suggest Stewart's desire to not incur any service
obligations that would require him to stay in the Navy beyond 2015,
see AR 88, 94, 103, and on at least one occasion, Stewart noted
that he "went to the Naval Academy and then to the Uniformed
Services University[,]" AR 103. Although on several occasions, Ms.
Gaston and Mr. Marin confirmed the incorrect OSDs reflected in the
MSP agreements, "no one person or officer within the Navy Medicine
[was] responsible for ensuring the accuracy of DOW physicians'
overall OSD.
." AR 89, 92, 101.
6

None of Stewart's e-mails caused the Navy to recognize its
mistake. However, there is no evidence in the Administrative Record
that Stewart kept his own tally of the obligations he incurred nor
that he ever challenged the Navy's calculation of his OSD before
entering into any of the three MSP agreements.
-10-

sponsorship of his undergraduate and medical education, AR 77-78,
but could be served concurrently with obligations incurred through
MSP agreements, AR 86.
In

order

to

formalize

rhinology fellowship,

Stewart's

participation

in

the Navy prepared a GME agreement,

stated that upon completion of his fellowship,
a five-year obligation to the Navy. AR 78

the
which

Stewart would owe

("When I complete this

GME, my total [active duty service obligation] will be: 5 years").
Ironically,

the

worksheet

used

to

calculate

this

obligation

actually includes Stewart's five-year obligation incurred by his
attendance

at

the

USNA,

but

omits

any

reference

to

service

obligations incurred through Stewart's multiple MSP agreements.
AR 75.
The worksheet notes that as of July 2004, Stewart still had
an obligation to serve nine additional years to account for his
remaining USNA and USUHS obligations.

Id.

It accounts for five

years of creditable service performed between July 2004 and July
2009.

Id.

The

worksheet

then

notes

obligations during the fellowship,

the

stay

of

Stewart's

and adds a year of additional

service for the fellowship, arriving at an OSD of July 2015. Id.
This

OSD

could

not

have

been

correct

given

the

lack

of

reference to obligations incurred under the MSP agreements.
-11-

any

The Government ·asserts that the .GME agreement worksheet was
not meant to account for MSP obligations and that "anyone familiar
with the acronyms MSP and MISP [Multi-year Incentive Special Pay]
should have known that these obligations were not included in the
OSD calculation of 2015." Gov't's Reply at 3.

4.

Recapitulation

For the sake of clarity,
have happened if

the Court will sum up what would

Stewart had made

each of

the

same

three MSP

requests and the Navy had correctly calculated his OSD in each MSP
agreement.

As

of

July

2004,

Stewart

still

owed nine

years

of

service in exchange for his education at the USNA and USUHS, and
thus, had an OSD of July 2013. He entered a two-year MSP agreement
(the first MSP agreement), which would have moved his OSD to July
2015. However, that first MSP agreement was terminated after just
two months in favor of a four-year MSP agreement
agreement).

Under the second MSP agreement,

have been September 2017
months

under the

second).

Finally,

first

(the second MSP

Stewart's OSD would

(a date which takes account of the two
MSP agreement and four

years

under the

after just a year under the second agreement,

Stewart signed a third MSP agreement, terminating the second MSP
agreement. Thus, Stewart's OSD should have been adjusted again to
September 2018 (beginning at July 2013, adding two months for the
-12-

first MSP agreement,

one year for the second MSP agreement, and

four years for the third and final MSP agreement) .
The one-year obligation incurred as a
rhinology

fellowship

obligation

incurred

could
under

be
an

served
MSP

result of Stewart's

concurrently

agreement.

Because

with

any

any

MSP

agreement necessarily increased Stewart's OSD by at least a year,
37

U.S.C.

§

302 (c) (1),

participation in the fellowship program

would not have affected Stewart's OSD.
If the Navy had never made its initial error, and Stewart had
entered into MSP agreements of the same duration, his OSD clearly
would be in September of 2018, not September of 2013 as the third
MSP agreement states, AR 62,

nor July 2015 as the GME worksheet

states, AR 75.
5.

Error Correction Letters

In 2010, the Chief of Naval Personnel became concerned that
many contracts with Navy medical officers contained incorrectly
calculated OSDs and requested that the Naval Audit Service perform
a review. See Pl.'s Ex. 1 [Dkt. No. 16-2]. The auditors identified
eight

Navy

physicians

affected

by

including Stewart. Pl.'s Ex. 1; Compl.
On February 9,

2011,

OSD
~

computation

errors,

29.

the Navy notified Stewart that it had

discovered that his MSP contracts failed to account for his five-13-

year

USNA

service

obligation.

inaccurate pre-MSP OSD of

July

AR

80.

2008,

The
id.,

letter
which

notes

the

had been the

baseline for the calculation of Stewart's OSD in his very first
MSP agreement, AR 42, and states that his OSD had been adjusted to
August 2013, AR 80. The letter goes on to warn that "[a]s a result
of this OSD adjustment,

it is possible any Multiyear Special Pay

(MSP) agreement you entered into may be affected." Id.
A second letter arrived two days later on February 11, 2011.
That letter again noted the original OSD calculation error,

and

correctly

MSP

identified

its

source

as

Stewart's

"initial

agreement executed July 27, 2004." AR 82. In order to correct the
error,

the Navy stated that it would amend the OSD contained in

Stewart's third and final MSP agreement from September 2013 to
October 2018. AR 82. 7

7

Given that the third MSP agreement lists an OSD of "September
2013," AR 62, and the Navy's correction letters of February 9 and
11, 2011 purport to add Stewart's five~year USNA service obligation
to his OSD, AR 80 & 82, it is not immediately clear why Stewart's
.amended OSD should be October 2018 rather than September 2018.
However, the worksheet appended to the third MSP agreement shows
an OSD of "2013/09/30," AR 69, so any difference may just be a
matter of a single day. Moreover, the Parties' briefs and the
Administrative Record do not consistently track shifts in
Stewart's OSD by days. Instead, they generally measure changes to
his OSD in months or even just years. Finally, Plaintiff has not
raised this issue, so the Court will treat the difference between
a September 2018 and an October 2018 OSD as de minimis and will
not address it further.
-14-

Both letters advised Stewart that he could "submit a request
to the Board for Correction of Naval Records

(BCNR)

to dispute

[the] decision." AR 82; accord AR 80.
B. Procedural

Backg~ound

Nearly three years later,

on January 12,

2014,

Stewart did

petition the Board to overturn the amendments referred to in the
two letters of February 9 and 11, 2011. Compl.

~

36. Specifically,

he requested that the Navy reinstate his pre-MSP OSD as July 2008
and recognize as binding the OSD of July 27, 2015 reflected in the
worksheet accompanying the GME agreement Stewart executed before
beginning his rhinology fellowship. AR 18-19.
On July 16, 2014, in response to Stewart's petition, the Board
requested an advisory opinion from the Navy Medicine Professional
Development Center, AR 27, and on September 15, 2014, the Navy's
Bureau of Medicine and Surgery responded, recommending disapproval
of Stewart's petition, AR 24. On November 7, 2014, the Board denied
Stewart's petition. AR 3-4.
On April 16, 2015, Stewart filed his Complaint [Dkt. No. 1]
challenging the
asserts

three

Board's

causes

Procedure Act, 5 U.S.C.

denial

of
§§

of

action,

his
all

petition.
under

the

702, 706(2) (A). Compl.

-15-

The

Complaint

Administrative
~~

40-79.

Stewart's first claim alleges that it was contrary to law for
the

Navy to

amend I his

OSD to

a

date

different

from

contained in his third and final MSP agreement. Compl.

the
~~

date

40-53.

Stewart's second claim alleges that it was contrary to law for the
Navy to amend Stewart's OSD to a date different

f ram the date

contained

he

in

the

GME

rhinology fellowship.

agreement
Compl.

~~

executed
54-67.

before

Finally,

began

his

Stewart's third

claim alleges that the Navy's amendments of Stewart's OSD were
arbitrary, capricious, and an abuse of discretion. Compl.

~~

68-

7 9.

On August 3, 2015, the Government filed its Motion to Dismiss
or, in the Alternative, Motion for Summary Judgment [Dkt. No. 12].
On August 31,

2015,

Plaintiff filed his combined Memorandum in

Opposition and Cross Motion for Summary Judgment [Dkt. No. 16]. On
October

13,

2015,

the

Government

filed

its

combined

Reply

to

Plaintiff's Opposition and Memorandum in Opposition to Plaintiff's
Cross Mot.ion for Summary Judgment
2015,

[Dkt. No.

23]. On November 3,

Plaintiff filed his Reply to the Government's Opposition

[Dkt. No. 26] .s

8

Plaintiff also filed a Motion for Leave to File a Surreply in
Opposition to Defendant's Motion to Dismiss or, in the Alternative,
Motion for Summary Judgment ("Pl.' s Mot. for Leave") [Dkt. No.
27]. On November 19, 2016, the Government filed its Opposition to
Plaintiff's Motion for Leave [Dkt. No. 28]. The Court denied
-16-

II.

STANDARD OF REVIEW
A.

Motion to Dismiss for Lack of Jurisdiction

Under Fed.

R. Civ.

P.

12 (b) (1),

burden of invoking the court's

"[t]he plaintiff bears the

subject matter

hear his or her claims. Arpaio v.

Obama,

jurisdiction" to

797 F.3d 11,

19

(D.C.

Cir. 2015). In deciding whether to grant a motion to dismiss for
lack of jurisdiction, the Court must "accept all of the factual
allegations

in

[the]

[C]omplaint

as

true[.]"

Jerome

Stevens

Pharm., Inc. v. Food & Drug Admin., 402 F.3d 1249, 1253 (D.C. Cir.
2005)

(quoting United States v. Gaubert, 499 U.S. 315, 327 (1991))

(internal quotation marks omitted). However, "[w]here necessary to
resolve a jurisdictional challenge under Rule 12(b) (1), the court
may

consider

evidenced

in

the

complaint

the

record,

supplemented
or

the

by

complaint

undisputed

facts

supplemented

by

undisputed facts plus the court's resolution of disputed facts."
Banneker Ventures, LLC v. Graham,
2015)

798 F.3d 1119, 1129

(D.C. Cir.

(internal citation and quotation marks omitted).
B.

Summary Judgment

Summary judgment may be granted only if the moving party has
shown that there is no genuine dispute of material fact and that

Plaintiff's Motion for Leave on February 2, 2016. Memorandum Order
of Feb. 2, 2016 [Dkt. No. 35].
-17-

the moving party is entitled to judgment as a matter of law. See
Fed. R. Civ. P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 325
(1986); Waterhouse v. Dist. of Columbia, 298 F.3d 989,

991

(D.C.

Cir. 2002).
Plaintiff's
§

706 (a) (2),

hold

challenge

arises

under

the

APA,

u.s.c.

5

which provides that reviewing courts "shall

unlawful

and

set

aside

conclusions found to be .

agency

action,

findings,

and

. arbitrary, capricious, an abuse of

discretion, or otherwise not in accordance with law[.]" Courts in
this Circuit routinely apply the APA's standards to the Board's
decisions.
2006)

See Piersall v. Winter,

435 F.3d 319,

321

(D.C.

Cir.

("These are not uncharted waters. We have many times reviewed

the decisions of boards for correction of military records in light
of familiar principles of administrative law." (internal quotation
marks omitted)).
When

a

district

court

reviews

an

administrative

action,

"[t] he entire case on review is a question of law." Am. Bioscience,
Inc. v. Thompson, 269 F.3d 1077, 1083-84 (D.C. Cir. 2001)
quotation marks omitted).
mechanism for deciding,
action is
consistent

"Summary judgment thus

as a matter of law,

(internal

serves as the

whether the agency

supported by the administrative record and otherwise
with

the

APA

standard
-18-

of

review."

Sierra

Club

v.

Mainella, 459 F. Supp. 2d 76, 90 (D.D.C. 2006)
INS,

554 F.2d 1173,

1177

&

n.28

(D.C. Cir.

(citing Richards v.

1977)).

Finally,

the

Court's review on summary judgment is limited to the Administrative
Record. Holy Land Found. for Relief and Dev. v. Ashcroft, 333 F.3d
156, 160 (D.C. Cir. 2003)

(citing Camp v. Pitts, 411 U.S. 138, 142

(1973)); Fund for Animals v. Babbitt, 903 F. Supp. 96, 105 (D.D.C.
1995) amended, 967 F. Supp. 6 (D.D.C. 1997)

("Summary judgment is

an appropriate procedure for resolving a challenge to a federal
agency's administrative decision when review is based upon the
administrative record.").
III. ANALYSIS

A.

Jurisdiction

"Federal courts have limited jurisdiction and may not presume
the existence of jurisdiction in order to decide a case on other
grounds." Morrison v. Sec'y of Def., 760 F. Supp. 2d 15, 17 (D.D.C.
2011)
Cir.

(citing Tuck v. Pan Am. Health Org., 668 F.2d 547, 549 (D.C.
1981)). On its face,

Plaintiff's Complaint seeks review of

the Board's failure to correct his OSD to follow his third MSP and
GME agreements as originally written,

see Compl.

~~

53,

67,

79,

rather than to enforce those agreements directly. Although this
distinction is subtle, it is critical to this Court's jurisdiction.

-19-

Sovereign immunity ordinarily protects the federal government
from suit without its consent. See Trans-Bay Engineers & Builders,
Inc. v. Hills, 551 F.2d 370, 376 (D.C. Cir. 1976). In this case,
Plaintiff

invokes

§

702

of

the

APA,

sovereign immunity for "action[s]
money damages[.]" 5 U.S.C.
As

already

noted,

which

partially

waives

seeking relief other than

702.

§

judicial

review

of

determinations under the APA is well established.

Board's

the

Piersall,

435

F.3d at 321. However, our Court of Appeals has also held that "the
waiver of sovereign immunity in the Administrative Procedure Act
does not run to actions seeking declaratory relief or specific
performance in contract cases[.]" Sharp v.
1521,
bases.

1523

(D.C.

First,

Cir.

1986).

"[the APA's]

Weinberger,

798 F.2d

The holding in Sharp rests on two

waiver

[of sovereign immunity]

is by

its terms inapplicable if 'any other statute that grants consent
to

suit

expressly

sought[.]'" Id.

or

impliedly

(quoting 5 U.S.C.

forbids
§

and Little Tucker Act" provide the

the

relief

which

is

702). Second, "the Tucker Act
exclusive

remedies

for

any

alleged breach of contract by the federal government and thereby
"impliedly

forbid"

the

federal

courts'

jurisdiction

to

grant

declaratory relief or specific performance in contract cases. Id.

-20-

The Government contends that Plaintiff's case is effectively
one for breach of contract because he seeks to enforce the original
terms of his MSP and GME agreements. However, in construing Sharp,
our Court of Appeals has stated "that a federal district court may
accept jurisdiction over a statutory or constitutional claim for
injunctive relief even where the relief sought is an order forcing
the government to obey the terms of a contract--that is, specific
performance.

The Sharp Court ruled that

immunity for

[the plaintiff's]

his transfer,
Department

an order,

to

plaintiff]."

abide

prayer for an injunction against

in other words,

by

702 waived sovereign

§

compelling the Defense

the

of

its

Sav.

Transohio

terms

agreement

Bank

v.

Dir.,

Office

with
of

[the

Thrift

Supervision, 967 F.2d 598, 610 (D.C. Cir. 1992).
Plaintiff's
Transohio.
contract

Complaint

Stewart

claim.

is

follows

the

not bringing

Instead,

he

a

outline

described

free-standing

challenges

the

in
of

failure

Board's

breach

to

correct the Navy's unilateral amendment of the OSD reflected in
his MSP and GME agreements. If Plaintiff were to prevail, the Navy
might be

required to abide by the

terms

of the

agreements

as

written, but even so, that result would not transform Plaintiff's
case

from

one

contract claim.

seeking
Id.,

administrative

review

967 F. 2d at 610-11
-21-

into

a

breach

of

("The mere fact that a

does not,

court may have to rule on a contract issue

by

triggering some mystical metamorphosis, automatically transform an
action based on trespass or conversion into one on the contract
and deprive the court of jurisdiction it might otherwise have."
(internal brackets, citation, and quotation marks omitted)); see
also Spectrum Leasing Corp. v.
(D.C. Cir. 1985)

United States,

764 F.2d 891,

893

("A court will not find that a particular claim

is one contractually based merely because resolution of that claim
requires some reference to a contract." (emphasis in original)).
Accordingly, the Court holds that it has jurisdiction to hear
Plaintiff's

claims

and

shall

deny

the

Government's

Motion

to

series

of

Dismiss for lack of jurisdiction.
B.

As

Merits

described

above,

Stewart

entered

into

a

agreements with the Navy entitling him to Special Pay in exchange
for promises to extend his term of active duty service.

Those

agreements contained specific dates indicating when he would be
permitted to resign from naval service. By its own admission, the
Navy miscalculated the
Stewart,

and

upon

unilaterally alter

dates

?iscovery
Stewart's

contained in
of
OSD.

its

its

error,

Stewart

agreements
took

argues

that

with

steps

to

his

OSD

should be reset to conform to the written terms of his agreements
-22-

with

the

Navy

because

the

Navy's

unilateral

amendments

are

arbitrary, capricious, and contrary to law.
Plaintiff contends that the Court should employ the common
law of contracts to hold that the Navy's amendments to his OSD and
MSP agreements were contrary to law. The relief he seeks amounts
to

reinstatement

drafted.
Court

of

See Compl.

"[e]nforce

Agreement;

the
pp.

the

MSP

and

GME

agreements 9

17-18

(requesting,

parties'

November

as

initially

inter alia,
9,

2005

that the

[third]

MSP

[d]eclare [] Stewart's MSP OSD is November 1, 2015;

. . [p]ermanently enjoin the [Navy] .

. from enforcing, applying,

or implementing . . . any obligation dates other than July 1, 2015
(GME) and November 1, 2015 (MSP) "). Thus, Plaintiff seeks to retain
the

Special

inaccurate

Pay
OSD

and

benefits . he

reflected

in

his

received
final

MSP

from

the

admittedly

agreement

and

GME

agreement.
The Supreme Court has held that "[a] soldier's entitlement to
pay is depentjent upon statutory right." See Bell v. United States,
366 U.S.

393,

401

(1961).

"The rights of

.

service members

must be determined by reference to the statutes and regulations

9

The Navy's letters of February 9 and 11, 2011 do not purport to
amend Stewart's GME agreement. AR 6, 7. Rather, they amend his OSD
itself, and the OSD as listed in his third and final MSP agreement.
Id.
-23-

governing

the

[particular

benefit],

contract principles." United States v.

rather

than

Larionoff,

to

ordinary

4 31 U.S.

8 64,

869 (1997); see also Combs v. U.S., 50 Fed. Cl. 592, 605 (Fed. Cl.
2001)

(rejecting plaintiff's argument that he should be paid at

E-6 pay rate when Air Force forms

so indicated because statute

made clear that plaintiff was entitled to only E-1 pay rate).
Plaintiff contends that the Court can resolve this dispute
with

reference

only

to

ordinary

contract

law

because

"[t]o

determine whether the military has breached an enlistment contract
or whether an enlistment contract is invalid, courts apply general,
common law principles of contract law." Qualls v. Rumsfeld, 357 F.
Supp. 2d 274, 279-80 (D.D.C. 2005). It is true that "[m]any cases
hold

that

civilian

courts

may·

apply

traditional

contract

principles in construing the rights and obligations arising under
enlistment

contracts

and,

by analogy,

active

duty agreements."

Cinciarelli v. Carter, 662 F.2d 73, 78 (D.C. Cir. 1981). However,
Qualls acknowledges that cases "concern[ing] soldiers' entitlement
to pay" must be resolved according to statutory and regulatory
provisions, rather than ordinary contract law. Qualls, 357 F. Supp.
2d at 280 n.1.
This
entitlements

case
and

unquestionably
service

contains

obligations;
-24-

elements
however,

the

of

pay
relief

Plaintiff requests depends upon the validity of his MSP and GME
agreements, and the validity of those agreements, in turn, depends
upon the statutory and regulatory provisions authorizing Special
Pay.

Cf.

United States v.

Larionoff,

431 U.S.

864,

869

(1997)

(holding that plaintiffs' entitlement to "Variable Re-enlistment
Bonus" payments "must be determined by reference to the statutes
and regulations governing the [Bonuses],
contract

principles.") .

Thus,

rather than to ordinary

before

the

Court

may

consider

whether to enforce Stewart's agreements as written, it must first
consider whether

the

agreements

comport

regulations that authorize their creation.

with

the

statutes

and

Therefore, Plaintiff's

entitlement to the Special Pay he received and the validity of the
agreements he executed is governed by the statutory and regulatory
provisions underlying Special Pay agreements.
Section
Incentive

302 ( c) ( 1)

Special

Pay

permits

the

only when

an

payment

of

"officer

Special

first

Pay

executes

or
a

written agreement in which the officer agrees to remain on active
duty for a period of not less than one year beginning on the date
the officer accepts
§

the award of such special pay."

37

U.S. C.

302 (c) (1).
Navy

service

regulations

obligation

for

further

clarify

[Multi-year
-25-

that

Special

"[t] he
Pay

active

duty

and Multi-year

Incentive Special Pay] begins after any preexisting obligation for
medical

education

and

training

or

previous

MSP

agreement

is

served." OPNAVINST 7220.17 at 250(2) (a) . 10 The same regulation at
251(1)

requires the medical officer applying for Special Pay to

"execute[] a written agreement to remain on active duty for 2, 3,
or 4 years beyond any existing active duty service obligation for
medical education and training or a previous MSP agreement." Id.
at

251(1).

Plaintiff

acknowledges

that

these

regulations

are

binding. Pl.'s Reply at 2 ("USNA and USUHS obligations are required
to be served prior to any MSP obligations. See OPNAVINST 7220.17")
(emphasis added).
As initially drafted, the third and final MSP agreement would
have

obligated

Stewart

to

remain

on

active

duty

until

only

September 2013, despite the fact that he was already obligated to
remain on active duty until his UNSA and USUHS obligations were
met

in

July

2013.

Thus,

it

is

clear

that

the

MSP

agreement

conflicts with the requirements that officers receiving Special
Pay must agree to remain on active duty service for at least one
year,

37

U.S.C.

§

302 (c) (1),

and that active duty obligations

incurred through MSP agreements must

follow

the

completion of

Available at
http://www.med.navy.mil/bumed/Special Pay/Documents/HomeLinks/Re
ferences/OPNAVINST%207220.17.pdf (last visited Feb. 12, 2016).
-26-

·10

pre-existing service commitments,

OPNAVINST 7220.17 250(2) {a).

Given that Stewart's written agreements with the Navy would permit
him to keep five years'

worth of Special Pay distributions and

leave military duty before completing five years of service beyond
his pre-existing obligations,

those agreements are invalid.

See

Larionoff, 431 U.S. at 869.
If

enforced

as

written,

Plaintiff's

third

and

final

MSP

agreement would violate the statutory and regulatory provisions
that authorize the creation of MSP agreements. By refusing to take
action that would violate those provisions, the Navy is obviously
not acting arbitrarily, capriciously, or contrary to law.
Next,

the

Court

cannot

enforce

Stewart's

GME

Plaintiff asks the Court to "[e]nforce the parties'

agreement.

December 12,

2008 GME agreement" and to "[d]eclare [that] Stewart's GME OSD is
July 1, 2015 [.]" Compl. p. 1 7. As an initial matter,

Plaintiff's

GME agreement does not even contain the date July 1, 2015; that
date

is

contained

agreement itself.

only
AR 7 5.

in

the

worksheet

used

to

prepare

the

The agreement simply states "[w] hen I

complete this GME, my total ADO [active duty obligation] will be:
5 years[.]" AR 78.

It is far from clear whether the "total ADO"

referred to in the GME agreement is intended to include active
duty oblig.ations incurred through MSP agreements or whether it is
-27-

meant only to reflect the "total ADO" incurred through education
and training.
More importantly, however, enforcement of a July 1, 2015 OSD
would also conflict with 37 U.S.C.

302(c) and OPNAVINST 7220.17

§

at 250 (2) (a) because Plaintiff would retain five years' worth of
Special

Pay distributions

without

providing

the

required

five

additional years of active duty service beyond July 2013. Again,
the

Navy's

effort

to

comply

with

the

applicable

statute

and

regulation cannot be deemed arbitrary, capricious or contrary to
law.
In

short,

drafted,

Stewart's

violated

37

GME

U.S.C.

and MSP
§

agreements,

302(c) (1)

as

initially

and OPNAVINST

7220.17

250 (2) (a), and therefore could not be enforced as Plaintiff argues.
Finally,
terminate

his

undergraduate

the

practical

service
education,

with

reality
the

medical

is

that

Navy
school,

Stewart

which

wants

paid

internship,

for

to
his

medical

residency in the specialty of otolaryngology, and Special Pay of
annual lump-sum payments on top of his regular pay - without having
to pay for his end of the bargain quality,

namely,

provision of high

specialized medical care to the Navy for the period of

time he agreed to.

In sum, he would be unjustly enriched.

-28-

As the

Court said in Fontina v. White, 334 F.3d 80, 87 (D.C. Cir. 2003),
ruling in a similar situation,
Such a windfall would be inconsistent with one of the
Army's primary purposes, as stated in the regulations,
for
requiring
such
obligations
in
exchange
for
educational assistance: ensuring "a reasonable return to
the Army following the expenditure of public funds." AR
350-100, at P7 (a) (4); cf. Schaefer v. Cheney, 725 F.
Supp. 40 49, (D.D.C. 1989) (stating that "one of the
fundamental purposes of requiring" service obligations
is to provide the Army with "a fair quid pro quo for
[its] investment in personnel").
IV.

CONCLUSION

For the forgoing reasons, the Government's Motion to Dismiss
shall be denied, the Government's Motion for Summary Judgment shall
be granted, and Plaintiff's Cross Motion for Summary Judgment shall
be denied.

<Q~/~

February 24, 2016

GladySKeSSJ:r
United States District Judge

Copies to: attorneys on record via ECF

-29-