Articles Posted in US Court of Appeals for the Federal Circuit

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The Customs and Border Patrol (CBP) Discipline Review Board sent Boss a proposed 30-day suspension based on disciplinary infraction charges: failure to follow a policy related to overtime sheets, failure to follow supervisory instructions, and conduct unbecoming a U.S. Border Patrol Agent. The deciding official interviewed witnesses and received arguments from the agency and Boss and sent a decision letter, concluding that Boss should be disciplined on all three charges, but reducing the suspension to 15 days. Boss requested arbitration. During the arbitration hearing, the deciding official admitted that he had considered three documents that had not been provided to Boss or his union. The documents were agency policies regarding administratively uncontrollable overtime pay. The arbitrator agreed that the agency violated the contractual due process provision, and vacated Charge One. The parties agreed that the undisclosed documents solely relate to Charge One. The arbitrator analyzed Charges Two and Three on their merits, apparently concluding that he need not address Boss’s contractual and constitutional due process arguments, concluded that the agency carried its burden of proof, and reduced the discipline to a 10- day suspension. The Federal Circuit affirmed. The arbitrator properly treated the three charges separately and independently. View "Boss v. Department of Homeland Security" on Justia Law

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Sihota worked for the IRS for over 25 years. A 2011 IRS audit determined that, in 2003, Sihota reported a loss based on her purported ownership of NKRS, which was actually owned by Sihota’s son. The parties reached a settlement: Sihota acknowledged she had “acted negligently … resulting in an underpayment of ... $5341.00.” Sihota paid the assessment and penalty. The IRS terminated her employment, stating that Sihota was charged with either violating 5 CFR 2635.809 or 26 U.S.C. 7804, which requires the IRS to terminate any employee who willfully understates their federal tax liability, “unless such understatement is due to reasonable cause and not willful neglect.” The Union invoked arbitration. A hearing was held four years after the IRS contacted the Union about scheduling. The arbitrator concluded that inclusion of the loss on her return was not willful neglect, reinstated Sihota’s employment, imposed a 10-day suspension, and held that Sihota was not entitled to back pay, citing laches and the scheduling delay. The Federal Circuit vacated and remanded, stating that it could not discern which charges were properly considered or would support the suspension. If the only charge before the arbitrator was under the statute, the arbitrator could not impose any penalty. While the Union’s delay is inexplicable and might have barred the claim if the IRS could show prejudice, after allowing Sihota’s claim to proceed, the arbitrator cannot rely on laches to reduce her back pay. View "Sihota v. Internal Revenue Service" on Justia Law

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In 2009, RNB and GAF entered into an agreement under which GAF would promote RNB’s “Roof N Box” product, a three-dimensional roofing model, to building construction contractors affiliated with GAF. The agreement required the parties to submit disputes “arising under” the agreement to arbitration. GAF terminated the agreement after about a year. In 2016, RNB, together with its founder and president, Evans, brought suit against GAF based on GAF’s activities in marketing its own product that competes with the Roof N Box. The complaint alleged design patent infringement, trade dress infringement, and unfair competition. GAF moved to dismiss or stay the action pending arbitration. The district court denied that motion. The Federal Circuit affirmed, stating that GAF’s assertion that the arbitration provision covers the claims stated in the complaint is “wholly groundless.” The complaint challenges actions whose wrongfulness is independent of the 2009 agreement’s existence. View "Evans v. Building Materials Corp." on Justia Law