Markham v. U.S., 04-15616.

• Decision Date: 17 January 2006
• Docket Number: No. 04-15616.,04-15616.
• Parties: James MARKHAM, and as to the third claim, on behalf of others similarly situated, Plaintiff-Appellant, v. UNITED STATES of America; Elaine Chao, as Secretary of Labor; U.S. Department of Labor; Jane Doe; John Doe, 2-10; Doe Partnerships 1-10; Doe Entities 1-10; Melanie Galen; Two Unknown OWCP Claims Examiners; Two Unknown OWCP Nurses, Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1185

434 F.3d 1185

James MARKHAM, and as to the third claim, on behalf of others similarly situated, Plaintiff-Appellant, v. UNITED STATES of America; Elaine Chao, as Secretary of Labor; U.S. Department of Labor; Jane Doe; John Doe, 2-10; Doe Partnerships 1-10; Doe Entities 1-10; Melanie Galen; Two Unknown OWCP Claims Examiners; Two Unknown OWCP Nurses, Defendants-Appellees.

No. 04-15616.

United States Court of Appeals, Ninth Circuit.

Submitted November 22, 2005.^*

Filed January 17, 2006.

Stephen M. Shaw, Honolulu, HI, for the appellant.

Edward H. Kubo, Jr., United States Attorney, and Thomas A. Helper, Assistant United States Attorney, United States Department of Justice, District of Hawaii, Honolulu, HI, for the appellees.

Appeal from the United States District Court for the District of Hawaii; Susan Oki Mollway, District Judge, Presiding. D.C. No. CV-03-00257-SOM.

Before: MICHAEL DALY HAWKINS, McKEOWN, and CLIFTON, Circuit Judges.

McKEOWN, Circuit Judge:

In this appeal we consider whether the district court lacked subject matter jurisdiction over James Markham's complaint alleging constitutional violations in the handling of his injury claim by the Office of Workers' Compensation Programs of the United States Department of Labor ("OWCP"). Markham launches a broad indictment against various policies of the agency, labeling its practices a "campaign of terror." Rhetoric cannot, however, transform an unreviewable administrative practice into a constitutional violation. This case presents a clear example of a litigant making wholly insubstantial constitutional allegations to frame otherwise unreviewable administrative decisions. We affirm the district court's dismissal of Markham's complaint.

BACKGROUND

Markham filed a Federal Employee's Compensation Act ("FECA") claim after he was injured while serving as an electrician with the U.S. Department of the Navy. OWCP accepted Markham's claim and authorized continued compensation and medical benefits. A few weeks later, OWCP notified Markham that he was required to undergo vocational rehabilitation at the direction of OWCP, absent a good reason for not doing so.¹ The letter advised that a nurse had left Markham numerous unreturned voice mail messages trying to set up a time and place to meet and discuss his vocational rehabilitation. The letter warned Markham that if he continued to not cooperate with the nurse without good cause, OWCP would reduce his compensation benefits to zero pursuant to 5 U.S.C. § 8113(b) and 20 C.F.R. § 10.519.² In conclusion, Markham was warned that a reduction in compensation benefits would continue until he complied in good faith with OWCP's vocational rehabilitation efforts.

The letter had its intended effect. Shortly after receiving it, Markham cooperated with the nurse and OWCP and began receiving benefits. OWCP informed him that it would not take action or reduce his benefits for his initial non-cooperation. Markham concedes that he has received all benefits owed him.

Taking great offense to the threat of reduced benefits, Markham filed suit against the Department of Labor, the Secretary of Labor ("Secretary"), OWCP, and various individuals within OWCP. Markham alleged that he was denied due process through OWCP's "campaign of terror," which resulted in a threat to reduce compensation benefits without adequate pre-deprivation notice or a meaningful opportunity to be heard.

Markham also alleged a litany of due process violations in various other OWCP administrative practices and customer service facilities. For example, Markham claimed that OWCP violates the Constitution by: failing to maintain a claims office in his home state of Hawaii; requiring that beneficiaries participate in telephone conferences with multiple parties in different time zones; using a Kentucky address and San Francisco telephone number for notices and correspondence with beneficiaries in Hawaii; using nurses who lack contact information beyond voice mail; delegating authority to nurses and retaining employees whom he regards as unqualified; and using misleading non-cooperation letters.

To remedy these supposed constitutional violations, Markham seeks an injunction against these practices and a broad declaratory judgment "that all statutes, codes[,] proceedings, practice[s], and agency common-law authorizing administrative remedies by the OWCP are inadequate, unconstitutional and void."

The district court dismissed Markham's complaint pursuant to Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction under 5 U.S.C. § 8128(b), stating that "Markham raised wholly insubstantial constitutional challenges." We review de novo the district court's dismissal for lack of subject matter jurisdiction. Federal Deposit Ins. Corp. v. Nichols, 885 F.2d 633, 635 (9th Cir.1989).

DISCUSSION

FECA establishes a comprehensive and exclusive workers' compensation scheme for federal employees. The Act provides that "[t]he United States shall pay compensation. . . for the disability or death of an employee resulting from personal injury sustained while in the performance of his duty. . . ." 5 U.S.C. § 8102(a). The Secretary has the authority to administer and decide all questions under FECA, 5 U.S.C. § 8145, and may formulate rules and regulations necessary to administer the Act, 5 U.S.C. § 8149.

Section 8128(b) explicitly provides that the courts do not have jurisdiction to review FECA claims challenging the merits of benefit determinations:

The action of the Secretary or his designee in allowing or denying a payment under this subchapter 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); see Staacke v. United States Sec'y of Labor, 841 F.2d 278, 281 (9th Cir.1988).

The courts have fashioned two narrow exceptions to this absolute jurisdictional bar. Courts retain jurisdiction to consider constitutional challenges or claims for violation of a clear statutory mandate or prohibition. Staacke, 841 F.2d at 281; see Rodrigues v. Donovan, 769 F.2d 1344, 1347-48 (9th Cir.1985).

Markham's first claim is that his benefits were denied without notice, at least as to the period of his non-cooperation. Besides his own declaration, the only thing that Markham cites to support this allegation is the OWCP non-cooperation letter. This letter does not help Markham, however, because the plain language of the letter provides notice only of a potential reduction of benefits if Markham did not comply with the unambiguous instructions of the letter. The letter was in fact notice of the intended action in the event Markham did not cooperate. Although Markham was never denied benefits, any such challenge is precluded by § 8128(b).

Recognizing this bar, Markham tries to transform a garden-variety administrative action into a case of constitutional magnitude. Even assuming there was a transitory denial of benefits for the period of non-cooperation, Markham does not claim he was...