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Schulman v. Small Business Administration

Decided: October 20, 1993.

BERTRAM F. SCHULMAN, PETITIONER,
v.
SMALL BUSINESS ADMINISTRATION, RESPONDENT.



Appeal from the Merit Systems Protection Board.

Before Archer, Lourie, and Clevenger, Circuit Judges.

Per Curiam

Per Curiam.

DECISION

Bertram F. Schulman petitions for review from the March 15, 1993 decision of the Merit Systems Protection Board (board) affirming the Small Business Administration's (SBA) removal of Mr. Schulman from his position. Because the decision is based in part on clear factual error that could have materially impacted the result, we vacate and remand this case for reconsideration of the question of whether the government acted for legitimate managerial considerations.

Discussion

Mr. Schulman was an attorney advisor in the New York District Office (NYDO) of the SBA. In 1991, prior to his assignment to the NYDO, Mr. Schulman had been the subject of proposed disciplinary action while working out of a NYDO branch office in Melville, New York. On February 25, 1992, Mr. Schulman accepted a "permanent" reassignment to the NYDO from the Melville Office as part of an agreement settling the proposed disciplinary action. One month later, on March 25, 1992, Mr. Schulman was advised by his superiors that his "services as an attorney advisor, GS-905-13, could be better utilized in the Buffalo District Office." The letter further advised Mr. Schulman that if he declined the assignment, "it will be necessary to propose your removal from federal service." In spite of this warning, Mr. Schulman declined the assignment to the Buffalo District Office (BDO) and was removed from his position in June 1992.

Mr. Schulman appealed this decision to the board which affirmed the SBA's removal decision. The board found that the SBA demonstrated a legitimate managerial reason for the reassignment, and that Mr. Schulman had adequate notice of the reassignment and refused to accept it. The board also found the removal was not a reduction in force (RIF) action and that the SBA had not acted in bad faith. Mr. Schulman timely appealed the board's decision to this court.

We review decisions of the board under a narrow standard. The board's decision must be affirmed by this court unless it is found to be

(1) arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with the law;

(2) obtained without procedures required by law, rule, or regulation having been followed; or

(3) unsupported by substantial evidence.

5 U.S.C. § 7703(c) (1988); True v. Office of Personnel Management, 926 F.2d 1151, 1153 (Fed. Cir. 1991). In this case, because factual errors undermine the board's Conclusions, we cannot say the decision is supported by substantial evidence.

The board considered Mr. Schulman's reassignment to Buffalo to have been made for legitimate management considerations. In reaching this Conclusion, one of the important witnesses relied on by the board was Mr. Hallock, the New York Regional Counsel in charge of reviewing attorney assignments. Hallock testified, and the board found, that there was an immediate need for an attorney in the BDO and that there was an oversupply of attorneys in the NYDO. Hallock relied on agency statistics for his testimony, stating that, in his opinion, they provided a "rough" indicator of the relative workloads of the NYDO and BDO. The board credited Hallock as establishing that "the BDO carried a larger number of loan closings than the NYDO and 99 litigation cases, which is about half the number maintained in the NYDO." Yet, during the cross-examination of Hallock, Mr. Schulman demonstrated at least two errors in the statistical data that had been relied upon by Hallock. When confronted with the first error, Mr. Hallock testified "I'm not surprised and I'm not happy about it. We do a lot of things and we make mistakes." The second error related to the number of litigation cases of the BDO. Whereas the total number ...


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