Hanauer v. Reich, 95-2499

• Decision Date: 06 May 1996
• Docket Number: No. 95-2499,95-2499
• Citation: 82 F.3d 1304
• Parties: James L. HANAUER, Plaintiff-Appellee, v. Robert B. REICH, Secretary of Labor, Defendant-Appellant.
• Court: U.S. Court of Appeals — Fourth Circuit

Page 1304

82 F.3d 1304

64 USLW 2721

James L. HANAUER, Plaintiff-Appellee, v. Robert B. REICH, Secretary of Labor, Defendant-Appellant.

No. 95-2499.

United States Court of Appeals Fourth Circuit.

Argued March 8, 1996.

Decided May 6, 1996.

Appeal from the United States District Court for the Western District of Virginia, at Roanoke. Jackson L. Kiser, Chief District Judge. (CA-94-668-R).

ARGUED: Irene Marietta Solet, Civil Division, United States Department of Justice, Washington, D.C., for Appellant. Charles Robinson Allen, Jr., Roanoke, Virginia, for Appellee. ON BRIEF: Frank W. Hunger, Assistant Attorney General, Robert P. Crouch, Jr., United States Attorney, Michael Jay Singer, Civil Division, United States Department of Justice, Washington, D.C., for Appellant.

Before HAMILTON and WILLIAMS, Circuit Judges, and WILLIAMS, Senior United States District Judge for the Eastern District of Virginia, sitting by designation.

Vacated and remanded by published opinion. Judge HAMILTON wrote the opinion, in which Judge WILLIAMS concurred. Senior Judge WILLIAMS wrote a concurring and dissenting opinion.

OPINION

HAMILTON, Circuit Judge:

James L. Hanauer, a former federal employee receiving benefits under the Federal Employees' Compensation Act, 5 U.S.C. §§ 8101-93 (FECA), brought this action against Secretary of Labor Robert Reich (the Secretary) challenging the Secretary's refusal to consider Hanauer's request to receive his remaining FECA benefits in a lump sum. The district court determined that the Secretary violated a clear statutory mandate in FECA requiring individual adjudications of requests for lump-sum payment of benefits. Accordingly, the district court remanded the case to the Secretary for an individualized adjudication of Hanauer's request. The Secretary appeals. Concluding that FECA does not contain a clear statutory mandate requiring an individual adjudication of Hanauer's request for lump-sum payment of his remaining benefits, we vacate the district court's decision and remand for the district court to dismiss for lack of subject matter jurisdiction.

I.

On June 12, 1986, while acting in the course of his employment with the National Park Service, Hanauer suffered a permanent and disabling injury. Since that date, he has been receiving periodic FECA wage-loss benefits.

In 1994, Hanauer requested that the Secretary pay his remaining benefits in a lump sum pursuant to 5 U.S.C. § 8135(a), which gives the Secretary discretion to order payment of wage-loss benefits and other benefits in a lump sum if, inter alia, the beneficiary is about to become a nonresident of the United States. Hanauer asserted that he intended to move to Canada. The Secretary summarily denied the request, relying on 20 C.F.R, § 10.311, which provides that lump-sum payment of wage-loss benefits will no longer be made. Hanauer then brought this action seeking a declaratory judgment that 20 C.F.R. § 10.311 is void because it violates 5 U.S.C. § 8135(a). Hanauer also sought an order requiring the Secretary to pay his remaining benefits in a lump sum. The Secretary moved to dismiss for lack of subject matter jurisdiction, or, in the alternative, for summary judgment.

The district court concluded that it had subject matter jurisdiction and held that Hanauer was entitled to an individualized determination of his request for lump-sum payment of his remaining benefits. Accordingly, the district court remanded the case to the Secretary to conduct such an individualized determination. The Secretary appeals.

II.

Before turning to the merits of this case, we pause briefly to consider whether the district court's order is final and therefore subject to appellate review. We have jurisdiction over appeals from final decisions of district courts. 28 U.S.C. § 1291. A district court's order remanding a case to an administrative agency is usually not a final, appealable decision under 28 U.S.C. § 1291. See Culbertson v. Secretary of Health & Human Servs., 859 F.2d 319, 323 (4th Cir.1988). But if a district court order remanding a case to an administrative agency will be effectively unreviewable after a resolution of the merits, the order is a final decision for purposes of 28 U.S.C. § 1291. See Travis v. Sullivan, 985 F.2d 919, 922 (7th Cir.1993); cf. Culbertson, 859 F.2d at 323 (holding that the court had jurisdiction over an appeal from an order remanding a case to an agency because the order "operate[d] as a final denial of [a party's] claim").

The decision on appeal here is the district court's order remanding this case to the Secretary for an individualized determination of Hanauer's request for lump-sum payment of his remaining benefits. This order will be unreviewable after the Secretary's decision on remand, because the Secretary's decision "allowing or denying a payment under [FECA] is ... final and conclusive for all purposes" and "not subject to review ... by a court by mandamus or otherwise." 5 U.S.C. § 8128(b). Therefore, the district court's order remanding this case to the Secretary is final and immediately appealable for purposes of 28 U.S.C. § 1291.

Having concluded that the district court's order is final and immediately appealable, we proceed to consider the Secretary's argument that the district court did not have jurisdiction to review the Secretary's refusal to pay Hanauer his remaining benefits in a lump sum.

III.

Courts will decline to review agency actions only upon a showing that Congress clearly intended to restrict access to judicial review. See Lindahl v. Office of Personnel Management, 470 U.S. 768, 778, 105 S.Ct. 1620, 1626-27, 84 L.Ed.2d 674 (1985). Here, the Secretary argues that 5 U.S.C. § 8128(b) manifests Congress' clear intent to bar judicial review. That section provides:

The action of the Secretary or his designee in allowing or denying a payment ... is--

(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).

The Supreme Court has described § 8128(b) as an example of the unambiguous and comprehensive language that Congress uses when it "intends to bar judicial review altogether." Lindahl, 470 U.S. at 779-80 & n. 13, 105 S.Ct. at 1627-28 & n. 13. But even when the statutory language bars judicial review, courts have recognized that an implicit and narrow exception to the bar on judicial review exists for claims that the agency exceeded the scope of its delegated authority or violated a clear statutory mandate. See, e.g., Staacke v. United States Secretary of Labor, 841 F.2d 278, 281 (9th Cir.1988). This exception was first recognized in Leedom v. Kyne, 358 U.S. 184, 79 S.Ct. 180, 3 L.Ed.2d 210 (1958).

In Kyne, the National Labor Relations Board certified a collective bargaining unit consisting of both professional and nonprofessional employees. This certification was in direct conflict with a provision of the National Labor Relations Act (NLRA). The president of a labor organization brought suit against members of the Board in district court, asserting that the Board had exceeded its statutory authority. The Board argued that the NLRA's provisions establishing judicial review of certain Board actions in the court of appeals indicated Congress' intent to bar review of any Board action in the district court. The Supreme Court disagreed, holding that the district court had jurisdiction "to strike down an order of the Board made in excess of its delegated powers and contrary to a specific prohibition in the [NLRA]." Id. at 188, 79 S.Ct. at 183-84.

Although we have relied on the Kyne exception to allow challenges to agency actions on the ground that they exceeded the agency's delegated authority, see, e.g., Champion Int'l Corp. v. United States EPA, 850 F.2d 182, 185-86 (4th Cir.1988), we have not previously considered the applicability of the Kyne exception to § 8128(b). Other courts, however, have recognized that the Kyne exception applies to § 8128(b). See, e.g., Staacke, 841 F.2d at 281 (citing Kyne and holding that "jurisdiction exists where [the Secretary of Labor] is charged with violating a clear statutory mandate or prohibition"); see also Brumley v. United States Dep't of Labor, 28 F.3d 746, 747 (8th Cir.1994), cert. denied, --- U.S. ----, 115 S.Ct. 734, 130 L.Ed.2d 637 (1995); Woodruff v. United States Dep't of Labor, 954 F.2d 634, 639 (11th Cir.1992); Owens v. Brock, 860 F.2d 1363, 1367 (6th Cir.1988); but see Paluca v. Secretary of Labor, 813 F.2d 524, 527-28 (1st Cir.1987) (stating, without considering Kyne, that "[f]ederal employees have no right to appeal compensation decisions on FECA statutory grounds"), cert. denied, 484 U.S. 943, 108 S.Ct. 328, 98 L.Ed.2d 355 (1987).

The district court held that the Kyne exception applies here. The district court acknowledged that § 8128(b) generally bars judicial review of any action by the Secretary denying a payment under FECA. But the district court held that it had jurisdiction under the Kyne exception to review the Secretary's denial of Hanauer's request that his remaining benefits be paid in a lump sum, because Hanauer claimed that this denial violated a clear statutory mandate in FECA.

The Secretary argues that the district court erred in holding that the Kyne exception applies in this case. He relies principally on the decision of the Supreme Court in Board of Governors v. MCorp Financial, Inc., 502 U.S. 32, 112 S.Ct. 459, 116 L.Ed.2d 358 (1991). In MCorp, the plaintiff, a bank holding company, sought to enjoin the Board of Governors of the Federal Reserve System from prosecuting an administrative proceeding against it for its alleged violation of a Board regulation. The applicable banking regulatory statutes established a system for judicial review of Board actions. Under this system, the court of appeals was authorized to review final board orders. But no court had...