In the Matter of the Complaint Against                   )
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WILLIE J. BLOCKER                                                )
4506 Payne Drive                                                   )
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at                                                                            )
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Fort Washington, MD 20748-1152                         )    P.S. Docket No. PF-14

APPEARANCE FOR POSTAL SERVICE:                 Nan K. McKenzie, Esq.
Law Department
United States Postal Service
Washington, DC 20260-1144

APPEARANCE FOR RESPONDENT:                        Douglas E. Sapp
P.O. Box 2670
Merrifield, VA 22116-2670

POSTAL SERVICE DECISION

Willie J. Blocker (Respondent) has filed an appeal from the Initial Decision of an Administrative Law Judge in which it was concluded that Respondent was liable to the Postal Service under the Program Fraud Civil Remedies Act (PFCRA), 31 U.S.C. § § 3801-3812, for an assessment and civil penalty in the total amount of $9,866.56 less the amount of any restitution paid by Respondent pursuant to the Order of the United States District Court. The Postal Service opposes Respondent's appeal.

BACKGROUND

The General Counsel, United States Postal Service (Complainant), initiated this proceeding by filing a Complaint alleging that Respondent filed false claims with the Postal Service in order to obtain disability compensation for a work related injury sustained during the course of his employment. Specifically, the Complaint alleged that Respondent submitted a Form CA-1, Federal Employee's Notice of Traumatic Injury and Claim for Continuation of Pay/Compensation, and thereafter presented for payment three Continuation of Pay (COP) checks by which he falsely claimed to have been totally disabled by a back injury suffered while performing his duties as a Postal Service employee. The Complaint further alleged that during the time Respondent claimed to be totally disabled, he was employed full time as a maintenance engineer at a shopping mall. As a result the Complaint asked that Respondent be ordered to pay a penalty of $5,000 for the false CA-1 form which was submitted, plus an assessment of $4,810.64, representing twice the amount paid to Respondent by the Postal Service. In the alternative, the Complaint asked that Respondent be ordered to pay $15,000 for the three false claims made when Respondent presented the three COP checks for payment, plus the same $4,810.64 assessment of damages.

Respondent filed a timely Answer and Petition for Hearing in which he admitted he had been working at a full time job during the period he claimed to be disabled but denied having filed false claims with the Postal Service.

Respondent also denied that he was not disabled when he received the COP checks. Respondent in addition denied that the Postal Service had jurisdiction over the matter under 31 U.S.C. § 3803. As additional defenses, Respondent alleged that (1) his claim had been approved by the Department of Labor; (2) his physician had "disabled" him from work; (3) the Postal Service failed to process his compensation forms in a timely manner; (4) the Postal Service "refused return of checks;" and (5) the actions of the Postal Service were racially motivated and in reprisal for his having filed for compensation on this and past occasions. Respondent also requested the appointment of an attorney.

At a hearing before the Administrative Law Judge, both parties called witnesses and introduced documentary evidence. Following the filing of proposed findings of fact and conclusions of law, the Administrative Law Judge issued the Initial Decision in which he concluded that: (1) he had jurisdiction to consider the matter under the PFCRA; (2) Respondent's conviction in a United States District Court of willfully making a false statement on the Form CA-1 was "binding" in this proceeding;^1/ and (3) there was ample evidence in the record of this proceeding to independently support the same finding. As a result, the Administrative Law Judge further concluded that Respondent was liable to the Postal Service for an assessment of $4,866.56 plus a civil penalty of $5,000, for a total liability of $9,866.56, reduced by the amount of any restitution paid by Respondent pursuant to the Order of the District Court.

Thereafter, Respondent filed this appeal taking exception to the findings and conclusions of the Initial Decision. Complainant filed a reply to the appeal requesting that the Initial Decision be affirmed.

EXCEPTIONS AND DISCUSSION

Respondent's primary contention on appeal is that he was denied due process in this matter because, (1) the Complaint, which is dated November 15, 1990, was held until December 1990 when Respondent was imprisoned, thereby denying him the right to obtain counsel and creating an unreasonable obstacle to his filing a Petition for Hearing; (2) he was denied the right to a jury trial; (3) he was denied the right to appointed counsel; and (4) he was denied the right to proceed in forma pauperis, thus preventing him from having witnesses present at the hearing and from acquiring a copy of the transcript. Respondent also contends that under the PFCRA the Postal Service does not have jurisdiction to review or alter decisions on compensation claims made by the Department of Labor. Respondent, in addition, argues that, having been previously tried in a criminal case, this action is prohibited by the Double Jeopardy clause of the Fifth Amendment to the Constitution. Respondent next argues that the Postal Service was collaterally estopped from finding liability based on his having cashed the three COP checks because he was found not guilty on this count in the criminal case. Finally, Respondent argues that the evidence does not support the Administrative Law Judge's finding that he is guilty of fraud.

In response, Complainant argues that Respondent was accorded the requisite due process in this administrative proceeding since he knew the basis for the charges against him, understood the issues, and was afforded a full opportunity to meet those charges. According to Complainant, there was no impropriety in the service of the Complaint, Respondent was not prevented from filing his Petition or obtaining counsel, Respondent had no right to a jury trial or appointed counsel, Respondent was not prevented from proceeding in forma pauperis and Respondent has made no showing that he was prevented from calling witnesses essential to his case or that he was prejudiced by his alleged inability to obtain a transcript of the hearing. Complainant also argues the Postal Service has jurisdiction to bring this action, that Respondent has not been subjected to the double jeopardy prohibition of the Constitution, and that the doctrine of collateral estoppel is inapplicable in the case of an acquittal on a criminal charge. Finally, Complainant argues that the Administrative Law Judge's conclusion that Respondent submitted a false claim is amply supported by the evidence introduced at the hearing and by Respondent's criminal conviction under the False Claims Act.

Based on a review of the record and consideration of the parties' arguments, it is concluded that the Administrative Law Judge correctly determined that Respondent is liable to the Postal Service for an assessment and civil penalty in the amount of $9,866.56, less any restitution made pursuant to the Order of the United States District Court.

DUE PROCESS
Service of the Complaint

In his appeal from the Initial Decision Respondent, for the first time, contends that the delay in obtaining service of the Complaint denied him the right to obtain counsel and created an "unreasonable obstacle" to his filing a Petition for Heairng. In its response to the appeal Complainant submitted documents showing that the Complaint was mailed to Respondent by certified mail at the time it was issued, but returned to Complainant as unclaimed and thereafter served on Respondent while he was in prison. Although Respondent argues that the delay created an "unreasonable obstacle" to his filing a Petition for Hearing, he has provided no support for this argument. Moreover, since Respondent's Petition was filed timely, it is unlikely that any such showing could be made. Respondent has also failed to offer any evidence to show that the delay in service had any adverse effect on his ability to obtain counsel or to present a defense to the allegations in the Complaint. Therefore, Respondent's arguments concerning service of the Complaint have no merit.

Jury Trial

This issue was also first raised by Respondent on appeal without any supporting precedent showing that he was entitled to a jury trial. As argued by Complainant, neither the PFCRA nor the Seventh Amendment to the Constitution requires a jury trial in cases brought under the PFCRA. Where the matter in issue involves the adjudication of "public rights," Congress may assign, and in the PFCRA has assigned, such adjudicative responsibilities to administrative agencies which are not authorized to conduct jury trials. See Granfinanciera v. Nordberg, 492 U.S. 33 (1989); Northern Pipeline Const. Co. v. Marathon Pipe Line Co., 458 U.S. 50 (1982); Atlas Roofing Co. Inc. v. Occupational Safety and Health Review Commission, 430 U.S. 442 (1977). Accordingly, there is no merit to Respondent's argument that he is entitled to a jury trial.

Right to Appointed Counsel

Respondent argues that, as an indigent litigant, he was entitled to have counsel appointed to represent him in this proceeding because the "[assessment] of penalty and subsequent inability to pay could result in imprisonment." Absent the threat of the loss of physical liberty, due process does not require the appointment of counsel for an indigent litigant. See Lassiter v. Dept. of Social Services, 452 U.S. 18, 25, rehearing denied 453 U.S. 927 (1981); Walker v. McLain, 768 F.2d 1181 (10th Cir. 1985), cert. denied. 474 U.S. 1061 (1986). Respondent has provided no support for his contention that his inability to pay the amounts assessed could lead to imprisonment. The PFCRA does not provide for imprisonment as one of its penalties. Moreover, a person may not be imprisoned for the genuine inability to pay a fine or assessment. Bearden v. Georgia, 461 U.S. 660, 668 (1983); Tate v. Short, 401 U.S. 395, 399 (1971). Since no threat of imprisonment exists, the Administrative Law Judge was not required to appoint counsel to represent Respondent in this matter.

Right to proceed in forma pauperis

Respondent's argument that he was denied the right to proceed in forma pauperis and thereby prevented from calling witnesses and obtaining a copy of the transcript is not supported by the record. An initial difficulty with Respondent's argument with respect to this issue is that he first raised the issue on appeal.^2/ Further, Respondent has provided no legal basis for his argument that he should have been allowed to proceed in that manner or that he was prevented from obtaining the testimony of any witness or that his failure to obtain the transcript of the hearing prejudiced him in any manner. Accordingly, Respondent's argument that he was improperly denied the right to proceed in forma pauperis provides no basis for relief.

JURISDICTION

Respondent argues that the decision to pay or not to pay a disability compensation claim is the sole responsibility of the Department of Labor (DOL) under § 8128(b) of the Federal Employees Compensation Act, and that the Postal Service lacks jurisdiction to review those decisions. The Administrative Law Judge concluded that he had jurisdiction to consider the Complaint brought under the PFCRA, ruling that the Department of Labor's decision whether to grant or deny a compensation claim did not affect the jurisdiction of the Postal Service to determine whether a false claim has been made and, if so, the penalty and assessment due under the Act.

The Court of Appeals for the Federal Circuit has determined that a decision by DOL on a claim for compensation under 5 U.S.C. § 8128 does not deprive an agency of the right to determine whether the claim had been falsely made. Minor v. Merit Systems Protection Board, 819 F.2d 280 (Fed. Cir 1987), see Cox v. Merit Systems Protection Board, 817 F.2d 100 (Fed. Cir. 1987); Miller v. United States Postal Service, 26 M.S.P.R. 210 (1985). We have taken a similar position in prior cases arising under the PFCRA. See Sheila Martin Underwood, P.S. Docket No. PF-34, P.S.D. March 31, 1993; Neldie E. Nelson, P.S. Docket No. PF-3, P.S.D. August 19, 1992. Absent a showing that contrary precedent exists, we are unable to conclude that a decision by DOL on a disability compensation claim deprives the Postal Service of the authority to decide in a PFCRA proceeding whether a false claim has been made. Thus, the Administrative Law Judge correctly determined that he had jurisdiction to consider the allegatons against Respondent.

COLLATERAL ESTOPPEL

Respondent's appeal does not challenge the Administrative Law Judge's conclusion that Respondent is collaterally estopped from challenging the effect of his conviction under count II of the indictment. However, Respondent argues that the Administrative Law Judge should also have found that the "not guilty" verdict on count I of the indictment prohibited Complainant from asserting, and the Administrative Law Judge from considering, a PFCRA claim based on Respondent's cashing of the COP checks he received.

The Administrative Law Judge concluded that, under the circumstances of this case, Respondent's cashing of the COP checks did not constitute a "claim" within the meaning of the PFCRA. He therefore did not impose any civil penalty or assessment for Respondent's cashing of those checks. Absent the imposition of a penalty or assessment based on the COP checks, there is no reason to address this issue on appeal.

DOUBLE JEOPARDY

Respondent argues that the Double Jeopardy clause of the Fifth Amendment precludes the Postal Service from bringing this PFCRA case because he was previously tried in a United State District Court for a criminal offense based on the same acts. As correctly concluded by the Administrative Law Judge, an action under the PFCRA is civil rather than criminal in nature and therefore the assessment of civil penalties would not ordinarily be considered a vioolation of the Double Jeopardy clause. See United States v. Halper, 490 U.S. 435 (1989). However, as also correctly pointed out by the Administrative Law Judge, the amount of the penalty must be examined to complete the inquiry, since a disproportionate civil penalty may be found to constitute a second punishment, prohibited by the Double Jeopardy clause of the Fifth Amendment. United States v. Halper, supra at 442-43

In this case, Respondent was subjected to a civil penalty of $5,000 in addition to an assessment of $4,866.56. These amounts are within the guidelines of the PFCRA and bear a rational relation to the $2,433.28 amount claimed by Respondent, given the funds necessarily consumed by Complainant in the investigation and prosecution of this case. The facts here are clearly distinguishable from the facts in Halper, where the Court agreed that the imposition of a civil penalty of more than 220 times the amount received by the Respondent would have constituted a second punishment and a violation of the Double Jeopardy clause. The amount assessed against Respondent here is restitutional in nature and not so disproportional to the amount of the false claims as to be considered a violation of the Fifth Amendment prohibition against punishing a person twice for the same act. Accordingly, Respondent's argument is rejected.

SUFFICIENCY OF THE EVIDENCE

Respondent next argues that the Administrative Law Judge erred in finding Respondent guilty of fraud. Respondent contends that the evidence presented establishes that he sustained an injury and that it was not fraud to seek compensation for that injury even though he was otherwise employed while obtaining disability compensation. Complainant argues that the Administrative Law Judge properly concluded that a preponderance of the evidence establishes that Respondent knowingly presented a false claim for disability benefits.

Apart from the collateral effect of Respondent's criminal conviction for making false statements under 18 U.S.C. § 1001, a review of the evidence of record confirms that Respondent was properly found liable under the PFCRA. A preponderance of the evidence^3/ supports the Administrative Law Judge's findings that during the time Respondent collected pay for his alleged disability and while complaining to his physician that he was in severe pain and unable to stand erect, he was working approximately 40 hours per week as a maintenance engineer repairing heating and air conditioning equipment (I.D., FOF 3-6); that those duties required him to lift and carry up to 50 pounds, climb in ceilings, stoop, bend, walk and work in confined places (I.D., FOF 6); and that he performed all of those tasks during that period without complaint or apparent difficulty attributable to any injury (Id). The Administrative Law Judge rejected as not credible Respondent's testimony that his duties consisted of "sitting around talking ... reading the newspapers, ... drinking ... coffee." The Administrative Law Judge heard the testimony and observed the demeanor of the witnesses, and his determination is accorded great weight. Rockwell International Corp. v. NLRB, 814 F.2d 1530 (11th Cir. 1987); Griessenauer v. Depart. of Energy, 754 F.2d 361 (Fed. Cir. 1985). Respondent has shown no basis for reversing the Administrative Law Judge's determination. Accordingly, it is concluded that the Administrative Law Judge properly determined that Respondent submitted a false claim.

CONCLUSION

After consideration of the record and Respondent's exceptions, it is concluded that Respondent is liable to the Postal Service under the PFCRA, 31 U.S.C. § § 3801-3812, for an assessment of $4,866.56 plus a civil penalty in the amount of $5,000 for a total liability of $9,866.56, less the amount of any restitution actually made pursuant to the Order of the United States District Court. Accordingly, Respondent's appeal is denied.

James A. Cohen
Judicial Officer

1/ Respondent was indicted on August 22, 1990, on three counts. Following a jury trial, Respondent was convicted on Count II of the indictment for violation of the False Claims Act, 18 U.S.C. § 1001. Count II states:

On or about October 25, 1989, ... [Respondent] willfully and knowingly did make and cause to be made a false, fictitious, and fraudulent statement and entry as to material facts ... in that in a Form CA-1 ... [Respondent] stated and represented that he was disabled for work because of an injury incurred while working at ...[USPS] on October 23, 1989, whereas in truth of fact, as he then knew, he was not disabled for work by any injury.

Respondent was found innocent of Count I of the indictment, which alleged [Respondent]

... willfully and knowingly did embezzle, steal, purloin and convert to his use property of the United States and a department or agency thereof, that is, cash totalling the amount and value of approximately $3,770.

Count III of the indictment was withdrawn by the prosecutor. Respondent was sentenced to serve 90 days in prison, two years of supervised probation and was ordered to pay $3,770 in restitution to Postal Service.

2/ There is no indication in the record Respondent sought to proceed in forma pauperis during the pendency of this matter before the Administrative Law Judge.

3/ Under 31 U.S.C. § 3803(f), the determination of liability and the amount of a civil penalty and assessment are to be based on a preponderance of the evidence.