Tort: Retaliation suit against government agency dismissed

Where a grant recipient alleged the National Science Foundation Office of Inspector General used its investigative powers to retaliate against her after she lodged complaints, but the agency was immune from suits involving discretionary functions, and the decision whether to investigate is a discretionary function, the suit was dismissed.

Background

This case arises from two investigations conducted by the National Science Foundation Office of Inspector General, or OIG. Carol Scarlett, a former recipient of a National Science Foundation, or NSF, grant, alleges that the OIG used its investigative powers to retaliate against her for complaints she lodged against the NSF.

On Sept. 28, 2023, Dr. Scarlett filed the instant action in this court against the OIG, seeking relief “through the Federal Tort Claims Act” or FTCA. The OIG has filed a motion to dismiss.

Analysis

“As a general matter, the United States is immune from suit unless it waives that immunity.” The FTCA waives sovereign immunity for “injury or loss caused by the negligent or wrongful act of a Government employee acting within the scope of his or her employment.”

However, the FTCA does not waive immunity for claims “based upon the exercise or performance or the failure to exercise or perform a discretionary function or duty” by an agency or government employee, “whether or not the discretion involved be abused.” “Where this discretionary function exception applies, the courts lack federal subject matter jurisdiction.”

The discretionary function exception applies where the government action at issue “involves an element of judgment or choice” and the judgment is “based on considerations of public policy.” The first prong of this inquiry “boils down to whether the government conduct is the subject of any mandatory federal statute, regulation, or policy prescribing a specific course of action.” The focus of the second prong is on “the nature of the actions taken and on whether they are susceptible to policy analysis.”

Applying the first prong of the analysis, the court must consider whether the OIG’s conduct “is the subject of any mandatory federal statute, regulation, or policy prescribing a specific course of action.” The only federal provision that Dr. Scarlett raises is 41 U.S.C. § 4712(b), which governs OIG investigations of reprisals by federal contractors or grantees against their employees.

Dr. Scarlett argues that the OIG failed to make a determination regarding her June complaint within 180 days pursuant to § 4712(b)(2)(a) and failed to submit a final report to her and the head of the agency as required by § 4712(b)(1). However, this statute is not relevant here because it applies to investigations of reprisals by a federal “contractor, subcontractor, grantee, subgrantee, or personal services contractor,” and not by the federal government itself.

Other than § 4712(b), Dr. Scarlett does not point to another mandatory federal statute, regulation, or policy that the OIG failed to follow in the course of its investigations of either the April or June complaints. In fact, “[i]t is well-established that decisions by law enforcement regarding whom to investigate, how to investigate, and whether to prosecute constitute discretionary activity by government officials.” Accordingly, Dr. Scarlett has not carried her burden under the first prong of the analysis. However, considering Dr. Scarlett’s pro se status, the court will analyze each of her claims in greater depth.

First, regarding the OIG’s decision to open the April investigation, the OIG’s governing “I- Manual” states that “each complaint is evaluated against investigative functions, priorities, and guidelines,” and that “the highest priority is given to the most serious allegations and those likely to have a substantive and significant impact on NSF.” This discretionary language and the inclusion of multiple factors to be balanced by the OIG, leaves no doubt that the decision to open an investigation involves an element of judgment or choice.

Second, Dr. Scarlett alleges that investigators took retaliatory actions in the course of the April and June investigations, including actions relating to the issuance of a subpoena and conduct during witness interviews. The manner in which the OIG conducted it investigations, including issuing subpoenas and interviewing witnesses, involved an element of “judgement or choice.”

Finally, Dr. Scarlett alleges that the OIG reached erroneous conclusions in both investigations by closing out her June complaint after finding no evidence to support her allegations and by “threaten[ing]” her in demanding repayment through the U.S. Attorney’s Office. As the Fourth Circuit has explained, the “later steps” of enforcement following an investigation “are discretionary because they are bound up in the decisions surrounding the investigatory step.”

Defendant’s motion to dismiss granted.

Scarlett v. National Science Foundation Office of Inspector General, Case No. 1:23-cv-01323, Aug. 1, 2024. EDVA at Alexandria (Nachmanoff). VLW 024-3-381. 13 pp.