Background
Nathan Strong worked in information technology for the U.S. Office of Special Counsel. After the agency issued a performance appraisal and proposed his removal, Strong appealed to the Merit Systems Protection Board. In July 2022, Strong and the agency entered a settlement under which he released employment-related claims through the agreement’s effective date and the agency promised, among other things, to return him to duty, rescind the appraisal, leave him unrated for at least 90 days, assign any later rating to specified officials, and withdraw the proposed removal. Strong resigned in November 2022, alleging constructive discharge.
Strong later sued in the Court of Federal Claims, asserting breach of the settlement agreement, fraudulent inducement, alteration of his timesheet, unpaid overtime, and several tort, statutory, and employment-related theories. The trial court dismissed the complaint, concluding principally that Strong had not plausibly alleged a contractual breach or viable pay claim and that certain employment claims belonged before the Merit Systems Protection Board. It also denied his motions to supplement or amend the complaint and to take judicial notice.
The Court’s Holding
In a nonprecedential per curiam opinion, the Federal Circuit affirmed most of the dismissal. The court agreed that the Court of Federal Claims had jurisdiction over Strong’s contract claims but held that he had not plausibly alleged violation of any settlement term. The agreement did not restrict who could participate in preparing an appraisal before a final rating, and no post-settlement rating was issued before Strong resigned. The covenant of good faith and fair dealing could not expand the agreement beyond its terms, while the agreement’s whistleblower clause did not incorporate the other statutes and regulations on which Strong relied.
The court held that Strong’s pre-settlement timesheet claim was barred by his release and that his overtime claim failed because the record showed he was exempt from the Fair Labor Standards Act, although the trial court had overlooked his allegation that the overtime was ordered. The Federal Circuit also affirmed the jurisdictional dismissal of claims belonging before the Merit Systems Protection Board and upheld the procedural rulings. It vacated the trial court’s merits analysis of fraudulent inducement because that pre-contract tort claim fell outside the Court of Federal Claims’ jurisdiction, while leaving the dismissal in place on jurisdictional grounds. Finally, it dismissed the portion of the appeal challenging denial of reconsideration because Strong did not file the required amended notice of appeal.
Key Takeaways
- The Court of Federal Claims had Tucker Act jurisdiction over Strong’s settlement-contract claims, but his allegations did not plausibly establish breach of an express or implied contractual duty.
- A fraudulent-inducement claim based on conduct preceding contract formation sounded in tort and therefore fell outside the Court of Federal Claims’ jurisdiction.
- Strong’s release barred his earlier timesheet claim, his FLSA-exempt status defeated his overtime claim, and failure to amend his notice of appeal foreclosed review of the reconsideration ruling.
Why It Matters
The decision illustrates the jurisdictional and pleading boundaries governing federal employees who bring settlement-related claims in the Court of Federal Claims. That court may adjudicate a claim for damages arising from breach of an employment settlement, but it generally cannot hear independent tort claims or employment disputes committed to the Merit Systems Protection Board.
The opinion also underscores that the implied covenant of good faith and fair dealing must remain tied to the bargain reflected in the contract and cannot create obligations the parties did not undertake. On appeal, litigants must separately satisfy procedural requirements for obtaining review of post-judgment rulings.