Outlaw v. McHugh et al

Filing 18

ORDER GRANTING DEFENDANT JOHN M. MCHUGH'S MOTION TO DISMISS re 14 Motion to Dismiss. Signed by JUDGE LESLIE E. KOBAYASHI on 06/30/2015. Plaintiff shall have until August 14, 2015 to move for leave to file an amended complaint, if he so chooses. The Court emphasizes that Plaintiff may not add new parties, claims or theories of liability, unless those additions are specifically requested in the motion. The Court CAUTIONS Plaintiff that, if he does not file a motion to amend by August 14, 2015, the Court will direct the Clerk's Office to close this case. (eps)CERTIFICATE OF SERVICEParticipants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Participants not registered to receive electronic notifications were served by first class mail on the date of this docket entry

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
JAMES F. OUTLAW,
Plaintiff,
vs.
JOHN MCHUGH, Secretary,
Department of the Army; and
DEPARTMENT OF THE ARMY,
Defendants.

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CIVIL 14-00371 LEK-KSC

ORDER GRANTING DEFENDANT JOHN M. MCHUGH’S MOTION TO DISMISS
On March 11, 2015, Defendant John McHugh, Secretary,
Department of the Army (“Army” and “McHugh”), filed his Motion to
Dismiss (“Motion”).

[Dkt. no. 14.]

Pro se Plaintiff James F.

Outlaw (“Plaintiff”) failed to file a memorandum in opposition,
although this Court extended his deadline to do so.
Order, filed 4/24/15 (dkt. no. 16).

See Entering

The Court finds this matter

suitable for disposition without a hearing pursuant to Rule
LR7.2(d) of the Local Rules of Practice of the United States
District Court for the District of Hawai`i (“Local Rules”).
After careful consideration of the Motion, McHugh’s supporting
memorandum, and the relevant legal authority, the Motion is
HEREBY GRANTED for the reasons set forth below.
BACKGROUND
On August 20, 2014, Plaintiff filed his “Complaint for
Damages and Injunctive Relief - 1. Invalid/Fraudulent Settlement

Agreement and for Specific Performance and Suspension;
Discrimination/Reprisal and Damages” (“Complaint”), asserting
federal question jurisdiction pursuant to Title VII of the Civil
Rights Act of 1964 (“Title VII”), as amended, 42 U.S.C. § 2000e1, et seq.

Along with the five-page Complaint, Plaintiff

attaches five exhibits.1

The gist of the lawsuit appears to be

an attempt to undo a negotiated settlement agreement (“NSA” or
“Settlement Agreement”) between Plaintiff and the Army resolving
various discrimination complaints, and the consequences of the
NSA.
On July 27, 2011, Plaintiff, his representative, and an
Army representative executed the NSA.2
at 8.]

[Complaint, Exh. 1 (NSA)

In the NSA, the Army agreed to: pay Plaintiff a lump sum

of $48,000.00; purge from Plaintiff’s personnel file all
documents referring to Plaintiff’s absence without leave from

1

Although he numbers the exhibits 1 through 6, he only
includes a cover sheet for Exhibit 2, with a handwritten note
stating, “presently missing.”
2

Since Plaintiff is proceeding pro se, this Court must (and
does) construe the Complaint liberally. See Nordstrom v. Ryan,
762 F.3d 903, 908 (9th Cir. 2014) (“[p]ro se complaints are
construed liberally” (citations and internal quotation marks
omitted)). Moreover, the Court here considers the exhibits as
part of the Complaint. See, e.g., Davis v. KHNL/KGMB, LLC, Civil
No. CIV. 14-00483 SOM/BMK, 2015 WL 3448737, at *1 (D. Hawai`i May
28, 2015) (“[C]ourts may ‘consider certain materials — documents
attached to the complaint, documents incorporated by reference in
the complaint, or matters of judicial notice — without converting
the motion to dismiss into a motion for summary judgment.’”
(quoting United States v. Ritchie, 342 F.3d 903, 908 (9th Cir.
2003)).
2

November 2, 2010 to February 18, 2011; and cancel Plaintiff’s
removal from federal service.

Plaintiff agreed to, inter alia:

withdraw various Equal Employment Opportunity (“EEO”) complaints
and appeals that he had made over the previous years;3 consider
the NSA to be a global settlement of all of these claims; and
voluntarily retire from federal service with an effective
retirement date of November 1, 2010.

The NSA provides an

enforcement mechanism whereby, if Plaintiff believes the Army has
failed to comply with the terms of the NSA, he must notify the
EEO/Civil Rights Office within thirty days of when he learned (or
should have learned) of the failure, and he may appeal the
decision on the notice to the Equal Employment Opportunity
Commission (“EEOC”).

[NSA at ¶¶ 4, 5, 8.]

Further, it provides

that, “[t]he parties agree that [Plaintiff’s] sole remedy for an
alleged agency breach of this Settlement Agreement is to request
that the terms of the Settlement Agreement allegedly breached be
implemented.”

[Id. at ¶ 8.]

While the agency was processing his retirement, on
August 18, 2011, he submitted a request for sick leave from
November 1, 2010, the termination date provided by the NSA, to
July 27, 2011, the NSA execution date.

3

On August 27, 2011, he

Plaintiff alleges that the complaints were “among other
basis [sic], discrimination by the Defendant Army at the U.S.
Army Yuma Proving Ground in Yuma, Arizona.” [Complaint at ¶ 10.]
This is the sole allegation as to the substance of any of his EEO
claims.
3

submitted another request from July 28, 2011 to August 25, 2011.
[Complaint, Exh. 3 (Outlaw v. Army, Docket Number DE-0752-110514-I-1, Initial Decision, Before Glen D. Williams,
Administrative Judge, Mar. 7, 2012 (“AJ Decision”)), at 3.]
Apparently, both of these requests were denied.

Then, on August

30, 2011, Plaintiff filed a Complaint with the Merit Systems
Protection Board (“Board”), alleging that he was suspended from
duty (“Suspension Complaint”).

[Complaint at ¶ 12.]

On

September 14, 2011, the agency processed Plaintiff’s retirement.
On March 7, 2012, the AJ dismissed the Suspension Complaint,
finding that the AJ did not have jurisdiction over the suspension
claim because Plaintiff was not an employee as of November 1,
2010, and thus the AJ could not consider his claim for a
suspension thereafter.

[AJ Decision at 1-5.]

On October 19, 2012, the Board affirmed the AJ
Decision.

[Complaint, Exh. 4 (Outlaw v. Army, Docket Numbers DE-

0752-11-0279-I-2, DE-0752-11-0514-I-1, Final Order, Oct. 19, 2012
(“Board Decision”)) at 5.]

Further, the Board also rejected

Plaintiff’s argument that the NSA was invalid, as unsupported.4
[Board Decision at 2-3.]
On October 23, 2013, Plaintiff filed an appeal with the

4

It appears from the Board Decision, and other exhibits,
that Plaintiff raised this argument before a different AJ, and
that in another initial decision, that AJ rejected it. This
decision is not part of the record and it is immaterial, in any
event, because the Board Decision rejected the argument.
4

United States Court of Federal Claims.5

[Complaint at ¶ 18; id.,

Exh. 6 (Outlaw v. United States, No. 13-833 C, Opinion and Order
of Dismissal, June 17, 2014 (“Claims Court Opinion”)), at 2.]

On

June 17, 2014, the Claims Court found that it did not have
jurisdiction to review the AJ and Board decisions regarding the
Suspension Complaint, and the NSA’s validity, because exclusive
review of the Board rests with the United States Court of Appeals
for the Federal Circuit.6

[Claims Court Opinion at 7.]

In

addition, the Claims Court concluded that it did not have
jurisdiction over Plaintiff’s claims to void the NSA and for
breach of the NSA, since it only has jurisdiction over claims for
money damages.

[Id. at 9, 12.]

Plaintiff thereafter filed the

instant Complaint.
The Complaint appears to allege the following claims:
discrimination and retaliation; cancellation of the NSA because
it was invalid and/or fraudulent; and breach of contract against
the Army for suspending Plaintiff and failing to properly execute

5

In the interim, on June 27, 2013, Plaintiff also attempted
to appeal the Board Decision to the EEOC, which rejected the
appeal on the ground that it had no jurisdiction to consider a
procedural matter decided by the Board. [Complaint, Exh. 5
(Outlaw v. McHugh, Petition No. 0320130033, MSPB No.
DE075211027912, Denial of Reconsideration, September 19, 2013
(“EEOC Decision”)), at 1-2.]
6

The Claims Court Opinion explains that Plaintiff had
already appealed to the Federal Circuit, but his appeal had been
rejected as untimely. [Claims Court Opinion at 6 n.5.]
5

his retirement application.7

[Complaint at ¶¶ 21-27.]

Plaintiff

requests the following relief: declaratory judgments that the NSA
is invalid and/or fraudulent, and the AJ erred in ruling
Plaintiff was not an employee up through September 13, 2011;
reinstatement of Plaintiff’s employment at Schofield Barracks in
Hawai`i or, alternatively, compensation for loss of salary and
benefits; general, compensatory, and incidental damages;
attorneys’ fees and costs; interest; and all other appropriate
relief.

[Id. at pgs 4-5.]

McHugh’s Motion followed thereafter.8
DISCUSSION

I.

Discrimination and Retaliation
To bring a Title VII case before this Court, Plaintiff

must first exhaust his administrative remedies.

He is obligated

to make contact with an EEO counselor within forty-five days of
the purported discrimination, and then file a formal complaint
within fifteen days of receipt of the right to file letter.

See

Johnson v. Henderson, 314 F.3d 409, 414-17 (9th Cir. 2002)
(considering both elements as required); see also Kraus v.

7

Based on the Claims Court Opinion, which quotes amply from
the complaint before it, it appears that Plaintiff essentially
used the same complaint in this case. Compare, e.g., Claims
Court Opinion at 7 (quoting complaint); with Complaint at ¶ 23
(identical language, including punctuation).
8

Although the Complaint also appears to name the Army
itself as a defendant, only McHugh moves to dismiss.
Notwithstanding, the following discussion applies equally to both
Defendants, and this Court rules as to the Army as well. See
Conclusion Section.
6

Presidio Trust Facilities Div./Residential Mgmt. Branch, 572 F.3d
1039, 1043 (9th Cir. 2009).
in his Complaint.

Further, he must allege these facts

See Williams v. California, 764 F.3d 1002,

1018 (9th Cir. 2014) (dismissing the plaintiffs’ Title VII claim
since they “failed to allege that they exhausted their
administrative remedies with respect to any such claim” (citation
omitted)).
Here, Plaintiff has not alleged that he made contact
with an EEO counselor or that he filed a formal EEOC complaint
regarding any discrimination or retaliation claims.

The only

allegation related to the EEOC at all is that Plaintiff filed a
petition with the EEOC “asking for review of the [Board
Decision],” and that the EEOC “rendered a final decision[.]”
[Complaint at ¶¶ 16-17.]

This claim, however, related to the NSA

and had nothing to do with any Title VII claim, just as the EEOC
concluded:
[W]e find that, even if [Plaintiff] had sought our
review of this matter in a timely fashion, the
[EEOC] has no jurisdiction in this matter because
the [Board’s] decisions have not addressed an
allegation of discrimination. The [Board’s]
determination regarding [Plaintiff’s] settlement
agreement with the [Army] that resolved his
[Board] appeal is clearly a procedural matter that
the [EEOC] cannot review.
[EEOC Decision at 1-2.]

That is, Plaintiff has not alleged that

he met with an EEO counselor or filed a complaint with the EEOC
related to any claims of discrimination.

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Instead, he offered

evidence that he filed a complaint that had nothing to do with
Title VII claims.

Plaintiff, therefore, has failed to exhaust

his administrative remedies, and this Court has no jurisdiction
to consider his Title VII claims.

The Court thus GRANTS the

Motion as to this issue and DISMISSES WITH PREJUDICE the
Complaint insofar as it alleges discrimination and retaliation
claims.

See, e.g., Heilman v. Sanchez, 583 F. App’x 837, 839-40

(9th Cir. 2014) (holding that “the district court did not abuse
its discretion by refusing to grant leave to amend because those
aspects of the complaint could not be cured by amendment” (citing
Weilburg v. Shapiro, 488 F.3d 1202, 1205 (9th Cir. 2007))).
II.

Breach of NSA
Plaintiff also appears to allege that, in essence, the

Army breached the NSA in denying him sick leave, and improperly
submitting the retirement application.
the NSA.

This claim is to enforce

Such a claim requires an independent basis for

jurisdiction.

Kokkonen v. Guardian Life Ins. Co. of Am., 511

U.S. 375, 378 (1994).

Plaintiff does not provide such a basis.

Also, since Plaintiff is suing a federal agency, he may
only bring this claim if McHugh (and the Army) waives sovereign
immunity.

The Ninth Circuit has clearly held that, in a case

challenging an EEOC settlement agreement, Title VII does not
provide such waiver.

See Munoz v. Mabus, 630 F.3d 856, 860-61

(9th Cir. 2010) (“We now join our sister circuits in holding that

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Congress’ waiver of sovereign immunity under Title VII does not
extend to suits to enforce settlement agreements entered into
without genuine investigation, reasonable cause determination,
and conciliation efforts by the EEOC.” (citations omitted)).
Since Plaintiff provides neither a basis for this Court’s
jurisdiction over the breach of NSA claims, nor a basis for
waiver of the Army’s sovereign immunity, this Court has no
jurisdiction over Plaintiff’s contract claims.9

The Court GRANTS

the Motion as to these claims and DISMISSES WITH PREJUDICE.
III. Validity of NSA
Finally, to the extent that Plaintiff attempts to undo
the NSA by alleging it is invalid or fraudulent, his Complaint
fails.

A court “will set aside a [military] settlement agreement

only if it can be shown that it is unlawful, entered into
involuntarily, or was the result of fraud or mutual mistake.”
Robbins v. Dep’t of the Navy, 502 F. App’x 951, 954 (Fed. Cir.
2013) (citing Sargent v. Dep’t of Health and Human Servs., 229
F.3d 1088, 1091 (Fed. Cir. 2000) (per curiam)).

The sum total of

allegations relating to the validity of the NSA are as follows:

9

Moreover, insofar as Plaintiff is attempting to bring an
appeal of the Board Decision, this Court may not review it. This
Court does not have any general appellate jurisdiction over Board
decisions, since exclusive appellate jurisdiction of the Board
rests with the Federal Circuit. See Elgin v. Dep’t of Treasury,
132 S. Ct. 2126, 2131 (2012) (“The Federal Circuit has ‘exclusive
jurisdiction’ over appeals from a final decision of the [Board].”
(citing 28 U.S.C. § 1295(a)(9); 5 U.S.C. § 7703(b)(1))).
9

22.

The July 27, 2011 NSA is invalid/fraudulent
and not signed by an ‘Official with Approval
Authority’ as required by statute. A
fraudulent NSA cannot resolve Plaintiff’s
appeal.

. . . .
24.

The NSA contains mutual mistakes (settlement
agreement cannot over-ride/void a Judge’s
ruling).

25.

The NSA was coerced, is unfair and Plaintiff
suffered numerous compensatory damages
(return of social security benefits already
paid, payment of Federal Income Taxes on
income not received, illegal taking
performance award and salary already paid
(without due process), as well as Life
Insurance coverage not requested).

. . . .
28.

Incidental and collateral to monetary relief,
Plaintiff hereby seeks a declaration by the
Court that the NSA is
invalid/fraudulent . . . .

[Complaint at ¶¶ 22, 24-25, 28.]

Other than bald assertions,

Plaintiff provides no facts as to: what makes the NSA invalid;
who coerced him and how exactly the NSA is fraudulent; what are
the mutual mistakes in the NSA; and how the terms of the NSA are
unfair.

The law is that “[t]hreadbare recitals of the elements

of a cause of action, supported by mere conclusory statements, do
not suffice” to state a claim for relief.
U.S. 662, 678 (2009).

Ashcroft v. Iqbal, 556

Plaintiff must allege more facts that show

how he was coerced into the NSA, or that the basis for the NSA
was mistaken or invalid, beyond his mere conclusory allegations.

10

Insofar as he does not do so, it appears that Plaintiff simply
regrets his decision to enter into the NSA.

“However, ‘mere

postsettlement remorse or change of heart cannot serve as a basis
for setting aside a valid settlement agreement.’”

Gipson v.

Dep’t of the Treasury, 549 F. App’x 979, 981 (Fed. Cir. 2013)
(quoting Hinton v. Dep’t of Veterans Affairs, 119 M.S.P.R. 129,
132 (2013)).
Since Plaintiff provides no factual allegations for his
claim that the NSA is invalid, the Court DISMISSES those claims.
The dismissal, however, is WITHOUT PREJUDICE.

See Akhtar v.

Mesa, 698 F.3d 1202, 1212 (9th Cir. 2012) (“A district court
should not dismiss a pro se complaint without leave to amend
unless it is absolutely clear that the deficiencies of the
complaint could not be cured by amendment.” (citation and
internal quotation marks omitted)).

Conceivably, Plaintiff could

amend his Complaint to assert a valid claim of coercion against
the Army.

However, he must allege at least some specific facts

supporting the claim that could give rise to a plausible claim.
See Iqbal, 556 U.S. at 678 (“To survive a motion to dismiss, a
complaint must contain sufficient factual matter, accepted as
true, to state a claim to relief that is plausible on its face.”
(citation and internal quotation marks omitted)).
CONCLUSION
On the basis of the foregoing, Defendant John McHugh’s

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Motion to Dismiss, filed March 11, 2015, is HEREBY GRANTED in its
entirety.

Insofar as his “Complaint for Damages and Injunctive

Relief - 1. Invalid/Fraudulent Settlement Agreement and for
Specific Performance and Suspension; Discrimination/Reprisal and
Damages,” filed August 20, 2014, asserts claims for
discrimination and retaliation and breach of contract, and
appeals rulings made by the Merit Systems Protection Board, this
Court has no jurisdiction and those claims are DISMISSED WITH
PREJUDICE.

Insofar as Plaintiff attempts to assert claims that

the negotiated settlement agreement between himself and the
Department of the Army was entered into involuntarily, or was the
result of fraud or mutual mistake, those claims are DISMISSED
WITHOUT PREJUDICE.

These rulings apply equally as to both McHugh

and the Army.
Plaintiff shall have until August 14, 2015 to move for
leave to file an amended complaint, if he so chooses.

The Court

emphasizes that Plaintiff may not add new parties, claims or
theories of liability, unless those additions are specifically

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requested in the motion.

The Court CAUTIONS Plaintiff that, if

he does not file a motion to amend by August 14, 2015, the Court
will direct the Clerk’s Office to close this case.
IT IS SO ORDERED.
DATED AT HONOLULU, HAWAII, June 30, 2015.

/s/ Leslie E. Kobayashi
Leslie E. Kobayashi
United States District Judge

JAMES F. OUTLAW VS. JOHN MCHUGH, ET AL.; CIVIL 14-00371 LEK-KSC;
ORDER GRANTING DEFENDANT JOHN M. MCHUGH’S MOTION TO DISMISS

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