Franks v. Nimmo, 81-2187

• Decision Date: 30 June 1982
• Docket Number: No. 81-2187,81-2187
• Parties: John J. FRANKS, M.D., Plaintiff-Appellee, v. Robert P. NIMMO, in his official capacity as U. S. Administrator of Veterans Affairs; U. S. Veterans Administration; T. P. Mullon, in his official capacity as VA Regional Administrator, Midwestern Region; Mansell G. Piper, individually and in his official capacity as Medical Center Director, Veterans Administration Medical Center, Denver, Colorado; William S. Hammond, M.D., individually and in his official capacity as Chief of Staff, VAMC, Denver, Colorado and Philip A. Varneck, individually and in his official capacity as Personnel Officer, VAMC, Denver, Colorado, Defendants-Appellants.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 1290

683 F.2d 1290

John J. FRANKS, M.D., Plaintiff-Appellee, v. Robert P. NIMMO, in his official capacity as U. S.

Administrator of Veterans Affairs; U. S. Veterans

Administration; T. P. Mullon, in his official capacity as VA

Regional Administrator, Midwestern Region; Mansell G. Piper,

individually and in his official capacity as Medical Center

Director, Veterans Administration Medical Center, Denver,

Colorado; William S. Hammond, M.D., individually and in his

official capacity as Chief of Staff, VAMC, Denver, Colorado

and Philip A. Varneck, individually and in his official

capacity as Personnel Officer, VAMC, Denver, Colorado,

Defendants-Appellants.

No. 81-2187.

United States Court of Appeals, Tenth Circuit.

June 30, 1982.

Rehearing Denied Aug. 18, 1982.

Sheila H. Meer, Denver, Colo. (Jack Kintzele, Denver, Colo., with her on the brief), for plaintiff-appellee.

Nancy E. Rice, Asst. U. S. Atty., Denver, Colo. (Robert N. Miller, U. S. Atty., Denver, Colo., with her on the brief), for defendants-appellants.

Before McWILLIAMS, BARRETT and McKAY, Circuit Judges.

BARRETT, Circuit Judge.

This appeal by defendants below, hereinafter jointly referred to as Veterans Administration or VA, is taken from the district court's issuance of a preliminary injunction sought by plaintiff-appellee, John J. Franks, M.D. (Dr. Franks), arising from an administrative proceeding undertaken by VA to determine whether Dr. Franks should be removed from his full-time salaried administrative position as Associate Chief of Staff for Research and Development (ACOS) performed at the VA Medical Center, Denver, Colorado. Dr. Franks convinced the district court, 519 F.Supp. 902, that he is entitled to greater procedural due process than that accorded him by the VA by virtue of his alleged status as a "permanent employee" rather than that of a "probationary employee".

Dr. Franks first joined the staff of the VA Medical Center at Denver, Colorado, in 1969 where he served as part-time Associate Chief of Staff for Research, without compensation. In 1971, he first received compensation for these part-time services on a one-fourth basis, increased to one-half salaried in 1978. The position occupied by Dr. Franks remained part-time until July 27, 1980, when he became salaried on a full-time basis as a result of a mutual agreement between the CU Medical School, the VA Medical Center and Dr. Franks. It was at this point that Dr. Franks received a permanent appointment as a VA doctor pursuant to 38 U.S.C. § 4104 ¹ and commenced serving the two-year probationary period required by 38 U.S.C. § 4106. ²

After Dr. Franks assumed the full-time salaried position, supra, a group of dissatisfied researchers in the medical center complained to the hospital director about the manner in which Dr. Franks was performing his duties. They asked the director to remedy the situation. The director determined that an in-depth evaluation of the research department should be undertaken, and he requested that a "site visit team" should be called in to evaluate the research department. The site visit team conducted its evaluation. It recommended that Dr. Franks not be retained in his administrative position of ACOS which was the only position evaluated. Dr. Franks' work and undertakings as a medical researcher and as a medical instructor were not involved in the evaluation. There was no recommendation that Dr. Franks give up these positions.

Interviews and discussions between Dr. Franks and VA officials failed to effect a satisfactory solution. When Dr. Franks refused to accept terms of a new position, VA officials commenced an administrative process to determine whether Dr. Franks should be removed from his position as ACOS. At the commencement of the administrative proceeding, Dr. Franks had been on a full-time basis for less than one year. As such, the VA treated Dr. Franks as a probationary employee pursuant to 38 U.S.C. § 4106, supra. Soon after the administrative process was undertaken, Dr. Franks, in accordance with a VA regulation, was granted 90 days within which to improve his performance in accordance with VA management recommendations. During this 90-day period the management personnel are required to submit a rating report. If the report should be unsatisfactory, it would then be reviewed by an independent professional standards board, whose review would be determinative of further proceedings. At the time that Dr. Franks filed the instant action in the district court, neither the management rating report required within the 90-day period or the review by the independent professional standards board had been completed. Thus, neither had made or submitted any findings or rendered any decisions.

The controversy involving Dr. Franks' status is relevant in relation to the nature of the VA administrative proceedings. The proceeding for termination of a probationary doctor is informal in a procedural sense, whereas the process is formal in relation to termination of a full-time, permanent doctor. Dr. Franks testified in the district court that he believed he was a permanent, rather than a probationary employee because his official appointment form does not state that he is subject to the two-year probationary period. However, a Mr. Varnak, Chief of Personnel at the medical center, testified that the omission on the form was simply a computer error, and when it was brought to his attention the form was corrected. Furthermore, Mr. Varnak testified that at least two memos were submitted to Dr. Franks dealing with his probationary status. The original form did, however, clearly state that Dr. Franks' appointment to his ACOS position was made pursuant to 38 U.S.C. § 4104, supra. The significance of this recital, according to VA, is that medical personnel are employed by the VA either on the full-time, permanent basis authorized under 38 U.S.C. § 4104, supra, or the temporary full-time, part-time and without compensation appointments authorized pursuant to 38 U.S.C. § 4014. The latter appointments are "... in addition to personnel described in ... paragraph (1) of section 4104 ..." 38 U.S.C. § 4114(a)(2). In addition to the above statutes dealing with the classification issue, the VA regulations contained in the VA Manual of Procedures spell out prior VA services which may be credited to either diminish or eliminate the two-year probationary period.

The district court's order directed that VA be "... enjoined from treating plaintiff John R. Franks, M.D. as anything but a non-probationary employee for the purposes of Chapter 73 of Title 38 of the United States Code." (R., Vol. I, p. 23). The effect of the injunction was to terminate VA administrative proceedings then in progress. This court, however, entered a stay of the district court's injunction pending appeal.

The district court heard evidence on Dr. Frank's complaint, and following arguments of counsel entered the order granting the preliminary injunction on August 18, 1981. It states in pertinent part that:

... In support of this argument (that Dr. Franks has not exhausted all available administrative remedies) defendants point out that the professional standards board has not yet issued a decision and argue that this matter is therefore not ripe for judicial review. Defendants misperceive the scope of the present motion. The preliminary injunction that I issue here does not impermissibly infringe on administrative discretion. I do not consider the merits of the employment dispute. I only determine plaintiff's employment status, so that the defendants will know what procedures they must follow. This case differs markedly from Sampson v. Murray, 415 U.S. 61 (94 S.Ct. 937, 39 L.Ed.2d 166) (1974). In Sampson the district court ordered that the federal defendants reinstate plaintiff in her federal employment. The Supreme Court reversed, finding that the district court's action impermissibly infringed upon administrative discretion. Id. at 68-78 (94 S.Ct. at 942-947). The Supreme Court's decision relied on several factors that are not present here. First, plaintiff in Sampson was clearly a probationary employee, and therefore, not entitled to the additional procedural protections that the plaintiff claims here. Id. at 80-81 (94 S.Ct. at 948). Second, plaintiff there had not made an adequate showing of irreparable injury. Id. at 84-92 (94 S.Ct. at 950-953). By contrast plaintiff has demonstrated that years of his past research efforts are endangered by defendants' planned actions. Finally, in Sampson the district court's remedy on reinstatement infringed on administrative discretion far more than my action here will. I find that this motion is ripe for the limited scope of relief which I grant. (Emphasis supplied).

(R., Vol. I, pp. 18, 19).

The VA urges that the district court's order should be set aside and the case reversed and remanded with instructions that Dr. Franks be required to exhaust his administrative remedies before seeking judicial relief. The VA contends that the district court erred in (1) entering its order because it lacked jurisdiction inasmuch as Dr. Franks had not exhausted his administrative remedies, (2) basing its findings with respect to the "non-probationary" status of Dr. Franks on an incorrect determination of law, and (3) entering the order which is clearly erroneous and/or the result of an improvident exercise of judicial discretion.

We must hold that the district court erred in issuing the preliminary injunction. The record is devoid of any established evidence of detriment to Dr. Franks in terms of his status, salary or performance of duties. To the extent that he may be personally and/or professionally embarrassed by virtue of the administrative proceedings, this is not the type of "injury" justifying the invocation of the "irreparable injury" standard applied in Lundgrin v. Claytor, 619 F.2d 61 (10th Cir. 1980), wherein we set forth four distinct prerequisites a...