Schmidt v. United States

• Decision Date: 25 April 2014
• Docket Number: No. 13–5007.,13–5007.
• Parties: Jeffry SCHMIDT, also known as Jeff Schmidt, Appellant v. UNITED STATES of America, Appellee.
• Court: U.S. Court of Appeals — District of Columbia Circuit

749 F.3d 1064

Jeffry SCHMIDT, also known as Jeff Schmidt, Appellant

v.UNITED STATES of America, Appellee.

No. 13–5007.

United States Court of Appeals,District of Columbia Circuit.

Argued March 18, 2014.

Decided April 25, 2014.

Appeal from the United States District Court for the District of Columbia (No. 1:10–cv–00570).

Michael D.J. Eisenberg argued the cause and filed the briefs for appellant.

Benton G. Peterson, Assistant U.S. Attorney, argued the cause for appellee. With him on the brief were Ronald Machen, Jr., U.S. Attorney, and R. Craig Lawrence, Assistant U.S. Attorney.

Before: HENDERSON and WILKINS, Circuit Judges, and SENTELLE, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge WILKINS.

WILKINS, Circuit Judge:

Appellant Jeffry Schmidt, a Marine Corps veteran, was honorably discharged from the military in 1989 by reason of physical disability. In 1990, he filed an application with the Board for Correction of Naval Records (BCNR) seeking an increase in his disability rating. His request was denied. In 2008, he asked the BCNR to reconsider its earlier decision based, at least in part, on his having been diagnosed with post-traumatic stress disorder and depression by the Department of Veterans Affairs (VA). After the BCNR's Acting Executive Director denied his application, Schmidt filed suit in the Court of Federal Claims, which later transferred one aspect of Schmidt's case to the U.S. District Court for the District of Columbia: his claim that the BCNR's procedure allowing for the Acting Executive Director (rather than the Board) to render a decision on his application was improper. Following transfer, the parties agreed to a remand to the BCNR, whereupon the Board itself considered Schmidt's claim anew. It was denied. Schmidt then sought to challenge, before the District Court, the merits of the BCNR's denial, filing an amended complaint without leave of court or the other side's consent. After disallowing the amended complaint, the District Court dismissed the case as moot, reasoning that Schmidt's only claim for relief had been fully resolved. Alternatively, the District Court ruled that Schmidt's challenge to the BCNR's 2011 decision would be time-barred and that, because he sought money damages, jurisdiction over the claim would lie with the Court of Federal Claims. Schmidt now appeals. Agreeing that the only claim ever properly placed at issue before the District Court was rendered moot by the stipulated remand to the BCNR, we affirm the District Court's dismissal on this basis and do not reach the other issues briefed on appeal.

–I–

Jeffry Schmidt served in the U.S. Marine Corps from February 1983 until March 1989, when he was honorably discharged by reason of physical disability due to a lower back condition. Schmidt was given a 10% disability rating, entitling him to a one-time severance payment of about $13,000. Almost immediately after his discharge, Schmidt filed for disability benefits with the Department of Veterans Affairs, and the VA initially awarded Schmidt a 30% combined disability rating (accounting for his lower back issues and a few other medical conditions). Armed with this higher disability rating, Schmidt filed a request for correction of his records with the BCNR, arguing that he was given an unjust rating at the time of discharge.¹ The Board denied Schmidt's request in March 1992, explaining that his new disability ratings were not dispositive “because the VA, unlike the military departments, may assign disability ratings without regard to the issue of fitness for military service.” Joint Appendix (“J.A.”) 74.

Sixteen years later, in March 2008, Schmidt sought reconsideration of the BCNR's decision, raising what he believed to be new and material evidence. Specifically, he pointed to the fact that the VA had since diagnosed him with post-traumatic stress disorder and depression, and that his overall disability rating from the VA had increased even more since the Board's original decision, totaling 100% (full disability) by that time. J.A. 68–74. In May 2008, the Acting Executive Director of the BCNR denied Schmidt's application; according to the letter of decision, though some of Schmidt's evidence was seen as “new,” it was not considered “material.” J.A. 65.

Schmidt then filed suit in the U.S. Court of Federal Claims, alleging that he was discharged from the Marine Corps with an incorrect disability percentage rating. He sought back pay and benefits in excess of $10,000, along with an order deeming him medically retired from the military at the disability rating assigned by the VA or, alternatively, a new medical examination board. In addition, Schmidt challenged the BCNR's denial of his reconsideration application, arguing that the decision was not only wrong on the merits, but also procedurally infirm under the Administrative Procedure Act (APA) insofar as the Acting Executive Director—and not members of the Board—acted on his request. J.A. 11–14. The Court of Federal Claims, ruling on cross-motions for summary judgment, dismissed the near entirety of Schmidt's claims as time-barred under 28 U.S.C. § 2501. With respect to Schmidt's procedurally-focused APA challenge, though, the Court of Federal Claims transferred that claim—and only that claim—to the U.S. District Court for the District of Columbia. See Schmidt v. United States, 89 Fed.Cl. 111 (Ct.Cl.2009) (transferring Schmidt's APA claim attacking “the promulgation of a Naval regulation that allows a staff member of the BCNR and not the BCNR itself to deny a petition for reconsideration”).²

Following transfer, the parties jointly agreed to remand to the BCNR Schmidt's remaining claim, which the parties described as “his claim that the Navy's regulation allowing denial of a request for reconsideration by the BCNR Acting Executive Director and not BCNR board members violated the APA.” J.A. 34–35. The Government agreed to set aside the earlier decision and to have members of the Board (and not the Acting Executive Director) consider Schmidt's request for reconsideration anew. Schmidt's application was no more successful before the Board, however. The BCNR denied his reconsideration request via letter dated March 17, 2011. In the Board's view, Schmidt failed to present any new arguments warranting correction of his records. Despite his subsequent diagnoses and heightened disability ratings from the VA, the Board concluded that Schmidt failed to show he was suffering from these conditions at the time of his discharge in 1989, or that they would have rendered him unfit for duty at the disability ratings he claimed. J.A. 45–47.

After the Board's ruling, Schmidt filed a “Status Report and Proposed Briefing Schedule” in the District Court, followed by an “Amended Complaint.” The amended complaint—filed without the Government's consent and without leave of court—purported to “challenge[ ] the March 17, 2011, BCNR decision as arbitrary, capricious, unsupported by substantial evidence, and contrary to law.” J.A. 37–41. The Government objected to Schmidt's amendment, noting, among other things, his failure to comply with Federal Rule of Civil Procedure 15(a)(2). J.A. 42 n. 1. At that point, in the Government's eyes, “[t]he only APA issue before [the] [c]ourt (the alleged improper participation by the Executive Director of the BCNR in Plaintiff's request for reconsideration before the BCNR) ha[d] been rectified.” J.A. 44. The District Court agreed and issued an order disallowing the amended complaint and adopting the Government's description of Schmidt's sole pending claim. J.A. 48–49.

Schmidt proceeded to file a “Motion to be Heard on the APA Issue,” arguing that the District Court had “APA jurisdiction” to hear his substantive appeal from the BCNR's reconsideration decision. Therein, Schmidt “agree[d] with the Government that the issue of the procedural APA violation [was] now moot”; he argued, however, that the Board's decision after remand “[was] itself subject to judicial review,” and he asked the District Court “to find that it has jurisdiction to hear [his] challenge to the March 17, 2011, final decision by the BCNR.” J.A. 50–55. Meanwhile, the Government moved to dismiss the case as moot, contending that the Board's decision on Schmidt's reconsideration application afforded him all the relief sought through his only remaining claim. The Government also argued, seemingly in the alternative, that any claim challenging the substance of the BCNR's 2011 decision would be time-barred and subject to the Court of Federal Claims' exclusive Tucker–Act jurisdiction in any event.

The District Court granted the Government's motion and dismissed Schmidt's case for lack of jurisdiction. It ruled that “[t]he Board's review on remand totally remedied and disposed of Plaintiff's sole argument that the Navy's regulation ... permitting the Executive Director to make such a decision” was improper. Finding that Schmidt had secured “the only remedy he sought in the remand,” the District Court thus dismissed the case as moot. Alternatively, the District Court also found that Schmidt's proposed “substantive” challenge to the merits of the 2011 BCNR decision would be barred by the statute of limitations and, as a claim seeking money damages, would be subject to the exclusive jurisdiction vested in the Court of Federal Claims. J.A. 56–61.

The District Court entered judgment on December 21, 2012, and Schmidt timely appealed. We have jurisdiction under 28 U.S.C. § 1291, and we review de novo the District Court's dismissal for lack of subject matter jurisdiction, including on mootness grounds. Del Monte Fresh Produce Co. v. United States, 570 F.3d 316, 321 (D.C.Cir.2009).

–II–

“Simply stated, a case is moot when the issues presented are no longer live or the parties lack a legally cognizable interest in the outcome.” Larsen v. U.S. Navy, 525 F.3d 1, 3–4 (D.C.Cir.2008) (quoting Cnty. of Los Angeles v. Davis, 440 U.S. 625,...