4th Cir.: Civil Service Reform Act May Have "Been So Undermined" That District Courts Should Take Over Federal Employee Lawsuits

"Because Congress intended for the Civil Service Reform Act to strip district courts of jurisdiction only if federal employees were otherwise able to receive adequate and independent review of their claims, we vacate and remand to the district court to consider whether the text, structure, and purpose of the Civil Service Reform Act has been so undermined that the jurisdiction stripping scheme no longer controls"

An excerpt from today's long Fourth Circuit decision in Nat'l Ass'n of Immig. Judges v. Owen (Judge Nicole Berner, joined by Judges Pamela Harris and Toby Heytens):

The National Association of Immigration Judges brought this [First Amendment] challenge to an employee policy that requires immigration judges to obtain permission before speaking publicly on issues relating to immigration…. The district court dismissed the case …, concluding that the policy could only be challenged through the administrative procedures established by the Civil Service Reform Act…. When a federal employee seeks relief from an action covered by the Civil Service Reform Act, she is required to comply with the prescribed scheme of administrative and judicial review and may not generally bring an initial claim in federal court. Constitutional challenges and pre-enforcement challenges are no exception.

When the Civil Service Reform Act functions as designed, we agree with the district court that the National Association of Immigration Judges would be required to bring its case through its administrative scheme.

It is not clear, however, that the Civil Service Reform Act is currently so functioning. The Civil Service Reform Act requires a strong and independent Merit Systems Protections Board and Special Counsel. That foundational principle, that functioning and independent bodies would receive, review, and decide in the first instance challenges to adverse personnel actions affecting covered federal employees, has recently been called into question. Because Congress intended for the Civil Service Reform Act to strip district courts of jurisdiction only if federal employees were otherwise able to receive adequate and independent review of their claims, we vacate and remand to the district court to consider whether the text, structure, and purpose of the Civil Service Reform Act has been so undermined that the jurisdiction stripping scheme no longer controls….

We must answer a single question: Does the CSRA strip the district court of jurisdiction over NAIJ's pre-enforcement challenge to the Speech Policy? If so, NAIJ's members must pursue their claims through the scheme outlined in the CSRA…. [Under] Thunder Basin Coal Co. v. Reich (1994), … we look to the statute's language, structure, and purpose to assess whether Congress intended to funnel covered federal employees' claims through the CSRA's administrative scheme, stripping district courts of jurisdiction.

We conclude that this step requires further examination by the district court. The CSRA's adjudicatory scheme was predicated on the existence of a functioning and independent MSPB and Special Counsel. We take notice that the function of the MSPB and Special Counsel, contrary to the CSRA's text and purpose, has recently been called into question. The district court must address this issue in the first instance….

The Supreme Court has recognized that the CSRA, when functioning as Congress intended, was designed to strip district courts of jurisdiction…. Those cases would have, until recently, made our analysis at step one of the Thunder Basin test simple. It has been well-established that Congress's intent for the CSRA to preclude district court jurisdiction is "fairly discernible in the statutory scheme." That conclusion can only be true, however, when the statute functions as Congress intended. During the pendency of this case, whether the CSRA functions as Congress intended has been called into question.

To maintain Congress' intent, the MSPB and Special Counsel must function such that they fulfill their roles prescribed by the CSRA…. [But] during the pendency of this case, the President removed the Special Counsel, and two members of the MSPB such that it currently lacks a quorum. These removals and the lack of quorum in the MSPB raise serious questions as to whether the CSRA's adjudicatory scheme continues to function as intended. Such a question, which turns on a factual record, is best addressed by the district court in the first instance. We therefore remand to the district court to assess the functionality of the CSRA's adjudicatory scheme.

In addition to providing a functioning adjudicatory process, the CSRA was designed to protect the independence of the agencies reviewing federal employees' claims…. The MSPB was hailed as "the Cornerstone of Civil Service Reform." In order to carry out its role of preserving the merit system for all federal employees, Congress recognized that the MSPB must be "insulated from the kind of political pressures that [had] led to violations of merit principles in the past." Congress explained that "absent such a mandate for independence for the merit board, it is unlikely that [it] would have granted the Office of Personnel Management the power it has or the latitude to delegate personnel authority to the agencies."

The CSRA established the same independence for the Special Counsel, who it tasked to "investigate and prosecute political abuses and merit system violations," and "safeguard the rights" of employees who "'blow the whistle' on violations of laws." …

Congress left little doubt about the importance of an independent MSPB and Special Counsel free from "any control or direction by the President." The MSPB and the Special Counsel "exercise statutory responsibilities independent of any Presidential directives." For this reason, the CSRA mandates that the members of the MSPB and the Special Counsel can be removed by the President "only for inefficiency, neglect of duty, or malfeasance in office." …

Put simply, Congress enacted the CSRA on the bedrock principle that the members of the MSPB and the Special Counsel would be protected from removal on political grounds, providing them independence from the President…. [But] in lawsuits challenging the removals of the Special Counsel and members of the MSPB, the Government has argued that the removal protections enshrined in the CSRA are violations of separation of powers, thereby calling into question the constitutionality of a critical aspect of the CSRA, and the continued vitality of the statute's adjudicatory scheme. This issue has yet to be resolved, however. At present, reinstatement of the MSPB Board members has been stayed by the Supreme Court. Trump v. Wilcox (2025).

The resolution of this issue could also call into question whether the CSRA continues to function as Congress intended for purposes of the Thunder Basin analysis. As described above, Congress may well have intended the CSRA to strip district courts of jurisdiction only because it understood that the President could not exercise unfettered control over the Special Counsel and MSPB. If that understanding proves to be incorrect, then a reevaluation of Congress's intent under Thunder Basin may be required. We leave that issue, should it arise, to the district court to address in the first instance.

At the time the district court considered its jurisdiction over this matter, the functionality and independence of the MSPB and Special Counsel had not been called into question. This is no longer necessarily true…. Accordingly, we remand to the district court to conduct a factual inquiry whether the CSRA continues to provide a functional adjudicatory scheme….