United States of America Merit Systems Protection Board Western Regional Office



Docket Number SF-1221-08-0562-S-1


INTRODUCTION On July 17, 2008 Hon. LuNell Anderson issued an order denying Appellant‟s request for a stay finding that “appellant has not yet shown that there is substantial likelihood that she will prevail on the merits of her claim of reprisal for whistleblowing.” For the reasons stated herein, including but not limited to the irrefutable evidence that Stan Koutstaal was on notice of Appellant‟s whistleblower activities prior to May 16, 2008, we respectfully submit that Appellant has shown that there is a substantial likelihood that she will prevail on the merits of her claim of reprisal for whistleblowing and seek immediate relief for the retaliatory substantial change in her duties mandated by the May 16, 2008 (Exhibit A) letter from Mr. Koutstaal.


Appellant is a Federal Program Officer charged with the duty of oversight of the Runaway and Homeless Youth program ensuring that grantees are in compliance with terms and

conditions of their respective grant awards. This has included significant contact with grantees to confirm their information, onsite monitoring, answering technical questions, handling emergencies such as wild fires, responding to inquires and ensuring program performance goals are met in a timely manner. The Agency‟s May 16, 2008 letter ordered appellant to cease all contact with grantees stating in pertinent part, “you are hereby ordered not to contact any of the grantees that are/were assigned to you for any reason” and “[y]ou are prohibited from contacting grantees in any manner.” The author, Stan Koutstaal, goes on to explain that discussions with grantees via an intermediary are also prohibited. The May 16, 2008 letter contains a subject line entitled “Direct Orders/ Temporary Assignment to Other Duties.” Additionally, the letter includes the statement, “[y]ou are hereby assigned „other‟ duties, as specified herein.” Stan Koutstaal then specifies that the “other” duties are a review and comparison of the Awarding Agency Grants Administration Manual (AAGAM) and the HHS Grants Policy Statement (GPS) and that a report is to be written. Mr. Koutstaal then states that other than contact with Team Leader Bill Clair, appellant is ordered to have no contact with other federal staff without obtaining advance approval from Bill Clair or Stan Koutstaal. The Agency‟s argument that the May 16, 2008 letter does not constitute a personnel action under 5 U.S.C. § 2302(a)(A) rings hollow. Mr. Koutstaal‟s own characterization of the purpose of his letter (Exhibit A--“Reassignment to other duties” and “You are hereby assigned „other‟ duties, as specified herein”) contradicts the agency‟s subsequent argument that the May 16 letter did not constitute a significant change in Appellant‟s responsibilities. It is clear from Mr. Koutstaal‟s own writing that Appellant had been maintaining significant contact with grantees assigned to her and that she was in possession of working files pertaining to these

grantees (Exhibit A-“You are hereby ordered to immediately surrender all working files and any/all other documentary information related to these grantees.”). Therefore, the May 16 letter removes her from these regular duties that involve contact with grantees and maintenance of working grantee files and orders her to perform “other” duties which essentially amount to a needle in a hay stack research assignment within the vacuum of an isolation chamber wherein she is explicitly prohibited contact with anyone other than Stan Koutstaal and Bill Clair. The new duties assigned appellant the enormous task of reading literally thousands of pages of documents including the CFR, OMB Circulars, AAGAM, ACF GAM, public policy documents looking for discrepancies and then writing a report within a very short and unreasonable timeframe. This assignment does not appear to have a useful purpose. Not only has appellant clearly established that the May 16, 2008 letter substantially changed her duties from actively managing grants and oversight of RHY grantees to an esoteric research assignment, she has also established that the change was intended to be punitive in nature based on the stated blatant goal of restricting freedom of speech and communication by isolating appellant from any and all colleagues other than Bill Clair and Stan Koutstaal.



A. STAN KOUTSTAAL HAD ACTUAL KNOWLEDGE OF APPELLANT’S WHISTLEBLOWER STATUS In addition to the substantial change in duties mandated by the May 16 letter, appellant has further shown that Stan Koutstaal, the author of the May 16, 2008 letter, had actual knowledge of appellant‟s whistleblower status. On or about July 14, 2008 appellant submitted copies of four letters from appellants‟ counsel to the Agency to the Board in support of her

motion for stay along with a copy of appellant‟s own email/letter to Stan Koutstaal dated January 23, 2008. Moreover, three of the letters from appellant‟s counsel were issued to the Agency prior to May 16, 2008 on the following dates: January 23, 2008, February 7, 2008 and April 28, 2008. Two of these letters were emailed directly to Stan Koutstaal (January 23, 2008, February 7, 2008). Region IX. The letters contain the following excerpts which are useful in assessing Stan Koutstaal‟s knowledge of appellant‟s whistleblower activities prior to his May 16, 2008 letter to appellant: 1) As your (sic.) aware, Ms. Brown Remple has filed several EEO complaints regarding your discriminatory treatment of her. Additionally, she has repeatedly invoked her rights under the Whistleblower Protection Act to no avail. (January 23, 2008 email to Mr. Koutstaal and Mr. Clair from counsel). (Exhibit B). 2) You are again taking disciplinary action against me in reprisal and retaliation for filing EEO Complaints and Whistleblowing activity. (January 23, 2008 email to Stan Koutstaal from Appellant). (Exhibit C). 3) You are once again on notice, that you and your agency are continuing your course of retaliation against Ms. Brown Remple in violation of federal law, including but not limited to the Federal Whistleblower Protection Act and the No Fear Act. (February 7, 2008 email to Stan Koutstaal. ) (Exhibit D). 4) I am writing to you on behalf of Ms. Brown Remple. She has retained me because she is being harassed in retaliation for whistleblowing. In a nutshell, she is an extremely wellqualified employee of the DHHS who has uncovered and reported fraud and nonperformance of grantees in the runaway youth shelter program. Her reward for doing so has been unrelenting harassment with the obvious goal of driving her out. (April 28, 2008 letter from Richard Rogers to Richard K. Waterman, Chief Counsel, DHHS, Region IX). (Exhibit E). The April 28, 2008 letter was sent to Richard K. Waterman, Chief Counsel, DHHS,

Mr. Koutstaal and counsel for the agency certainly had an opportunity to respond to these letters if there were any questions, comments or desired clarification. However, no one from the Agency, including Mr. Koutstaal, responded to any of the letters. For unknown reasons, there is no reference to the letters submitted to the Board on or

about July 14, 2008 in the Board‟s order denying appellant‟s motion for stay.


there is overwhelming evidence that Stan Koutstaal had actual knowledge of appellant‟s whistleblowing activities. The Agency‟s recent claim that Stan Koutstaal lacked knowledge of appellant‟s whistleblowing activities defies credulity. Accordingly, the Administrative Judge‟s conclusion that appellant did not meet her burden of establishing that Stan Koutstaal had knowledge of appellant‟s alleged whistleblowing activities is unsupported.

B. BASED UPON THE CLOSENESS IN TIME OF APPELLANT’S ONGOING WHISTLEBLOWER DISCLOSURES BEGINNING IN SEPTEMBER 2007 AND THE LETTERS TO MR. KOUSTAAL AND THE AGENCY, APPELLANT HAS SHOWN THAT HER WHISTLEBLOWING ACTIVITIES WERE A CONTRIBUTING FACTOR IN THE PERSONNEL ACTION An appellant may show that her whistleblowing activities were a contributing factor to a personnel action through circumstantial evidence such that the official taking action against the employee knew of disclosures and that the personnel action occurred within a period of time such that a reasonable person could conclude that the disclosures were a contributing factor to the personnel action. See Powers v. Department of the Navy, 69 M.S.P.R. at 155 (1995); 5 U.S.C. § 1221(e). In the instant case, there is direct and circumstantial evidence supporting the conclusion that appellant‟s whistleblowing activities were a contributing factor. Appellant‟s Whistleblower Stay Request initially filed June 30, 2008 included an explanation that appellant engaged in whistleblower activity by reporting gross fraud, gross waste, gross abuse and gross mismanagement to the Inspector General of the Agency beginning in September 2007. Additionally, appellant filed an EEOC complaint outlining her claim of reprisal based on both discrimination and whistleblowing activities. This investigation remains in progress.

In her stay request, appellant also described that since the end of September 2007, the Agency has engaged in numerous acts of retaliation or reprisal including, but not limited to creating a hostile work environment, subjecting appellant to disparate employment conditions, refusing two requests for reassignment, refusing alternative dispute resolution, soliciting negative comments from co-workers and non-compliant grantees. This activity was followed by the letters previously discussed (Exhibits B-E) requesting relief from the Agency‟s reprisal. These letters ranged from January 2008 to the last letter dated April 28, 2008. Stan Koutstaal‟s May 16 letter changing appellant‟s duties from grants management and oversight to a research project was sent just slightly over two weeks after the last letter to the Agency requesting relief from reprisal. The ongoing pattern of reprisal beginning in the Fall of 2007 just after appellant‟s September 2007 whistleblower disclosures culminating in the issuance of the May 16 letter, certainly create a suspicion strong enough to warrant a finding that a reasonable person would conclude that the appellant‟s protected disclosure was a contributing factor under 5 U.S.C. §1221(e). III. A STAY SHOULD BE GRANTED BECAUSE THE ISSUE PRESENTED IS OF SUCH IMPORTANCE THAT IS REQUIRES THE BOARD’S IMMEDIATE ATTENTION

An Administrative Judge may certify an interlocutory appeal if she determines that the issue presented “is of such importance to the proceeding that it requires the Board‟s immediate attention.” 5 C.F.R.§ 1201.91. An administrative Judge may only certify a ruling for interlocutory appeal if the record shows: (a) The ruling involves an important question of law or policy about which there is substantial ground for difference of opinion; and (b) An immediate ruling will

materially advance the completion of the proceeding, or the denial of an immediate ruling will cause undue harm to a party or the public. 5 C.F.R. §1201.92. The question of law or policy at issue in the instant case begins with whether the federal government must comply with State Licensure laws and local laws in overseeing compliance of grantees caring for runaway and homeless youth with the terms and conditions of grant awards including federal grants policy statement, federal agency policies such as the AAGAM rules, and other rules and regulations such as those promulgated by the Office of Management & Budget, Code of Federal Regulations. The question of law or policy at issue then expands to the duties of federal employees. Specifically, the question really becomes whether the obligation to the duties of federal service duties are higher than obeying orders from management which would by necessity place the employee in the position of being complicit in the gross fraud, gross waste, gross abuse and gross mismanagement. The circumstances surrounding appellant‟s situation are such that she discovered a number of grantee compliance problems including a grantee who was accepting money even though they had no building and were housing no runaway and homeless youth. Other circumstances include the following: On or about June/July 2007, appellant brought to light her concerns about a government agency, (City), that was an RHY grantee. On January 22, 2008, appellant again expressed her concerns that the City was passing through almost all of the grant award money to a non-profit agency. City used a pass through contract to task a nongovernmental organization that was actually carrying out the program including, writing the reports, answering questions, holding the licenses, etc. The government grantee performed none of the work to justify the expenditure of

government funds provided to them by their withholding approximately $3,500.00 per year of a $100,000 grant award. This situation was of concern since more than a substantial amount of the money awarded was being handed over with little to no oversight by the City. Appellant wanted to get things in order so that the program goals and grant award could be achieved in a manner that was not questionable. At that time, there was no record of any documentation that City and YMCA had any type agreement/contract on record at ACF. This was of great concern because City was not responding to inquiries and the Agency did not know who was running the program or how much money had been drawdown by City. Through her efforts, appellant obtained a copy of the new pass through contract from City. Upon her review of the contract, appellant read that it released City from all liabilities and all responsibilities. Betty White, fiscal specialist, was given a copy of the contract, shared appellant‟s concerns, and did not know what to do with this type of arrangement. Appellant and Ms. White decided the best course of action would be to bring the matter to the attention of Daphne Weeden, Director of Discretionary Grants, Washington D.C. Headquarters. Ms. Weeden thanked appellant for sending the contract to her electronically and promised to get back to appellant. It should be noted for the record, that appellant spoke to Ms. Weeden and Division of Grants Policy staff in September of 2007 about the contract and confirmed this was not an acceptable situation. In the past, grants officer Pat Colonnese was difficult to work with, had taken only a few grants management classes herself and knew little about the Awarding Agency Grants Administration Manual (AAGAM). Appellant had been trained to use the AAGAM during her work in Grants Policy and to answer questions of grants management. In addition, appellant had successfully completed at least five (5) grants management classes and COTR training twice. Ms. Colonnese and her staff often said that appellant was making them look bad because they

had not been through the training and were not applying the AAGAM principles. Appellant suspects Ms. Colonnese was the person who informed management of her efforts to resolve the problem with City. After Ms. Colonnese learned appellant had contacted Daphne Weeden, she sent an email to Mr. Koutstaal suggesting he have Mr. Clair be apprised and copied in on everything appellant did in the future. The very next day (January 23, 2008) Mr. Koutstaal sent an email to appellant citing her contact with Ms. Weeden about the City of Oceanside and imposed punitive controls and restrictive procedures. Mr. Koutstaal‟s email had the effect of preventing her from doing her job because she was forbidden to do virtually anything without first clearing it through a male team leader (Bill Clair) located over 2000 miles away in Chicago, Illinois. Specifically, she was ordered to consult with and obtain approval from Mr. Clair before communicating telephonically or electronically with any grantee or agency employee in another office regarding a grantee. Appellant was also ordered to telephone Mr. Clair by 10:00 am each morning regarding all work she was performing and to obtain advance approval if there was a need to deviate from this schedule. This turn of events was a complete reversal of the relationship between appellant and her previous supervisors who frequently relied upon her and her relationships with Grants Policy and Grants Management and appellant‟s expertise to benefit FYSB. No other employee was being treated in this punitive way. Over the course of several months and including November and early December, appellant was complimented on my work by both Mr. Koutstaal and Mr. Clair. However, there was a systematic attempt to keep appellant from discussing any problems with upper management including now blocking her from reporting improprieties beyond the first supervisory level. This created an extremely hostile working environment.

Another grantee was required to provide a minimum of four (4) beds for homeless or runaway youths. Appellant found that they only had two (2) beds, both of which were only available to boys. Their facility was a boys group home. There were no sleeping arrangements for girls at the grantee‟s location. Appellant was told by grantee that an agreement had been made with another grantee to provide the two (2) beds needed for girls. However, when appellant contacted this other grantee, they reported that the agreement with grantee was no longer in effect. In sum, grantee was not only in violation of the minimum four (4) bed requirement, but they were also receiving federal monies for which no services were being rendered. This brought this grantee out of compliance and appellant was deeply concerned that grantee could be violating the EEOC law. About ten months went by without the grantee taking any corrective actions even though appellant had requested plans to correct the deficiency, had several conference calls, and actions aimed at achieving compliance. Since this collaborative approach was not successful, grantee considered that the withholding of federal funds was a warranted approach. Appellant made several requests for cooperation from Ms. Colonnese and Mr. Clair, however, they did nothing. Appellant sent an email to grantee stating that she was requesting the Grants Officer place a hold on their funding until they corrected the deficiency. Once again, Ms. Colonnese complained to Mr. Clair and Mr. Koutstaal about appellant‟s actions. However, ultimately the grantee realized the gravity of the situation and immediately began working to correct the deficiency. Subsequently, appellant received two (2) thank you letters to appellant for helping them. Appellant was under the supervision of several officials since April 2007. Curtis Porter alone became her supervisor after Stan Chappell threatened her in September 2007. When Mr. Porter was appointed to take Karen Morrison‟s position after she left in November 2007, Mr.

Koutstaal became her supervisor. In January 2008, Mr. Koutstaal sent appellant orders to report to Mr. Clair each day, a non-supervisor. In April 2008 appellant made a second request for reassignment to another supervisor because of the way she had been treated by Mr. Koutstaal and Mr. Clair. To appellant‟s knowledge, Mr. Koutstaal never forwarded any of her requests up the chain of command as required by the Union/Management Agreement. Between Fall 2007 and May 2008 Mr. Koutstaal threatened appellant on numerous occasions with termination, however, appellant had acted within her job description and the requirements of Federal Program Officers outlined in the AAGAM. Had she not taken actions that were her duty and allowed the grantee problems to continue, she would have been complicit in ignoring our ethical duties as federal employees and committed fraud. As discussed, supra, letters were sent directly to Mr. Koutstaal and the Agency requesting them to cease their reprisal. The foregoing examples of grantee compliance problems and the Agency‟s retaliator y responses are only the tip of the iceberg. However, it is clear that instead of focusing on how to resolve grantee compliance problems, the Agency, including Stan Koutstaal, sought to silence appellant so that they would avoid the consequences for allowing all kinds of grantee situations to continue uncorrected in violation of applicable law, rules and regulations. Therefore, an immediate ruling will advance the completion of appellant‟s request for stay and appeal by resolving the progressive disciplinary actions imposed against appellant for raising questions of gross fraud, gross mismanagement, gross waste, gross abuse of authority and danger to public health and safety. The denial of an immediate ruling will cause undue harm to appellant because it remains clear that the Agency will continue, with impunity, to engage in a pattern of reprisal for appellant‟s whistleblower activities 5 C.F.R. §1201.92.

CONCLUSION Based on the facts and arguments, the attached exhibits and the previous filings by appellant, there is a substantial likelihood that appellant will prevail on the merits in her whistleblower appeal. Further, we respectfully urge the Administrative Judge to certify an interlocutory appeal because 1) an agency employee‟s duty to perform their ethical duty in grants management and oversight where the employee‟s ethical duties are in conflict Agency‟ orders is an important issue or question of law; 2) an immediate ruling will materially advance the completion of appellant‟s claims; and 3) the denial of an immediate ruling will cause continued undue harm to appellant who will continue to be subjected to the warrantless stripping of her job duties and by the imposition of isolation from grantees and federal staff. Date: July 26, 2008

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