Bloch, Felix S. v. Powell, Colin L.

Notice: This opinion is subject to formal revision before publication in the

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before the bound volumes go to press.

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued October 14, 2003 Decided November 21, 2003

No. 02-5311

FELIX S. BLOCH,

APPELLANT

v.

COLIN L. POWELL, SECRETARY OF STATE,

APPELLEE

Appeal from the United States District Court

for the District of Columbia

(No. 98cv00301)

Michael J. Kator argued the cause for appellant. With him

on the briefs was William S. Aramony.

William G. Kanter, Deputy Director, U.S. Department of

Justice, argued the cause for appellee. With him on the brief

were Peter D. Keisler, Assistant Attorney General, Roscoe C.

Howard, Jr., U.S. Attorney, and Katherine S. Dawson, Attor-

ney, U.S. Department of Justice.

Bills of costs must be filed within 14 days after entry of judgment.

The court looks with disfavor upon motions to file bills of costs out

of time.

2

Before: HENDERSON, TATEL, and ROBERTS, Circuit Judges.

Opinion for the Court filed by Circuit Judge ROBERTS.

ROBERTS, Circuit Judge: Appellant Felix S. Bloch was a

member of the Senior Foreign Service when he resigned in

1990, after the Department of State initiated proceedings to

remove him from the Service on national security grounds.

In 1992, the Department notified Bloch that the Secretary of

State had decided to withhold consent to Bloch’s receipt of an

immediate retirement annuity. Bloch then withdrew the

compulsory retirement contributions he had made to the

Foreign Service Retirement System. Bloch argues that the

Secretary lacked discretion to withhold the immediate annui-

ty, and that the denial of an immediate annuity constituted a

deprivation of property without due process of law. Bloch

also contends that his withdrawal of retirement contributions

cannot be construed as a waiver of his right to a deferred

annuity, because the Department did not inform him at that

time that a deferred annuity was an available option. The

Foreign Service Grievance Board held that the Secretary had

the discretion to withhold the immediate annuity, that such

action did not violate due process, and that Bloch had waived

the deferred annuity when he elected the lump-sum with-

drawal. The district court found that the Board’s decision

was not arbitrary or capricious. We affirm.

I.

Bloch, who joined the Foreign Service in 1958, was sus-

pended without pay in February 1990 when the Federal

Bureau of Investigation provided the Department of State

with information indicating that his continued employment

might not be consistent with national security. In a letter to

Bloch, the Assistant Secretary of State for Diplomatic Securi-

ty explained that Bloch, while serving overseas, had trans-

ferred national security information to an unauthorized indi-

vidual, had undertaken counter-surveillance measures when

traveling to meet with the individual, and had given false

information to FBI agents conducting a national security

investigation. Letter from Sheldon J. Krys to Felix S. Bloch

3

(Feb. 7, 1990), at 1–2 (JA 171, SA 171a). No criminal charges

were brought against Bloch, but the Department initiated a

removal proceeding under 5 U.S.C. § 7532. That statute

provides that the head of a federal agency may suspend an

employee without pay ‘‘when he considers that action neces-

sary in the interests of national security,’’ id. § 7532(a), and

may subsequently remove the employee after providing notice

and an opportunity to respond (including a hearing, at the

request of the employee) if the agency head ‘‘determines that

removal is necessary or advisable in the interests of national

security.’’ Id. § 7532(b); see also id. § 7532(c).

Bloch requested the hearing to which he was entitled under

the statute, but on July 3, 1990 — one week before the

scheduled hearing date — Bloch tendered a letter of resigna-

tion to the Secretary. On the same day, Bloch withdrew his

request for a hearing and submitted an application for volun-

tary retirement, including a request for payment of an imme-

diate retirement annuity. On July 18, the Department noti-

fied him by letter that his offer to resign had been taken

under advisement pending review by the Secretary. On

November 5, the Department wrote to Bloch to inform him

that the Secretary had determined that it was necessary and

advisable to remove Bloch in the interests of national securi-

ty, and that his removal from the Foreign Service would be

effective that day.

By the summer of 1991, the Department had not yet

responded to Bloch’s application for an immediate annuity,

and he renewed his request. In a letter dated April 2, 1992,

the Department notified Bloch that the Secretary had ‘‘decid-

ed to withhold consent to [his] voluntary retirement and

receipt of an immediate annuity.’’ Letter from John F.W.

Rogers, Under Secretary of State for Management, to Felix

S. Bloch (Apr. 2, 1992), at 1 (JA 157). As authority for the

Secretary’s right to withhold consent, the letter cited Section

811 of the Foreign Service Act of 1980 (codified as amended

at 22 U.S.C. § 4051), which provides:

Any participant who is at least 50 years of age and has 20

years of creditable service, including at least 5 years of

4

service credit toward retirement under the [Foreign

Service Retirement] System (excluding military and na-

val service), may on his or her own application and with

the consent of the Secretary be retired from the Service

and receive retirement benefitsTTTT

The Department indicated two reasons for withholding con-

sent in Bloch’s case: that his removal from the Foreign

Service in November 1990 was an involuntary separation

(rather than a voluntary retirement under Section 811) and

that the ‘‘serious national security reasons underlying’’ his

removal ‘‘furnish[ed] sufficient ground to withhold consent.’’

Letter from John F.W. Rogers, supra, at 1 (JA 157). The

letter also stated that ‘‘persons separated from the service

without benefit of an annuity are entitled to receive a refund

of contributions made to the retirement system during the

period of employment,’’ and indicated that Department staff

would contact Bloch about completing the paperwork needed

to receive the refund. Id.

On August 7, 1992, Bloch applied for the refund of his

retirement contributions; in October of that year he received

a lump sum of approximately $76,000. Some two and a half

years later, in March 1995, he initiated a grievance with the

Department alleging that the Secretary’s April 1992 decision

to withhold consent to his retirement and immediate annuity

was arbitrary and capricious, violated pertinent statutory

provisions, and contradicted a 1983 decision of the Foreign

Service Grievance Board (FSGB). The Department rejected

his grievance on February 20, 1996, holding that ‘‘there is

nothing in Section 811 which would suggest that removal on

national security grounds could not serve as a basis for the

withholding of the consent of the Secretary.’’ Letter from

Ruth A. Whiteside, Deputy Assistant Secretary for Personnel,

U.S. Department of State, to Herbert R. Rubenstein, Counsel

for Felix Bloch (Feb. 20, 1996), at 3 (JA 108). The letter

referenced and attached the April 2, 1992 letter to Bloch from

Under Secretary Rogers, explaining the bases for the Secre-

tary’s decision to withhold consent. Id. at 3–4 (JA 108–09).

5

Having thus disposed of the question of Bloch’s entitlement

to an immediate annuity, the Department’s letter went on to

address whether he was entitled to a ‘‘discontinued service’’

annuity pursuant to Section 810 of the Act (codified at 22

U.S.C. § 4050). Section 810 provides that any Foreign Ser-

vice member who ‘‘voluntarily separates’’ from the Service

after at least 5 years of service credit can withdraw his

contributions to the pension fund or leave them in place and

receive an annuity beginning at age 60. Unlike Section 811,

Section 810 does not require the consent of the Secretary for

the disbursement of an annuity at age 60 (often a deferred

annuity, as it would have been for Bloch, who was 54 years

old when he left the Foreign Service). The Department

concluded that Bloch was not entitled to a Section 810 annuity

because he had waived his right to it when he withdrew his

contributions in August 1992. As the Department empha-

sized, the form that Bloch submitted to request his refund

included a prominent section entitled ‘‘NOTICE TO APPLI-

CANT’’ stating that ‘‘[i]f you have five or more years of

Federal civilian service you may be entitled to an annuity

which will be forfeited by payment of this refund.’’ Applica-

tion for Refund of Compulsory Retirement Contributions

(Aug. 7, 1992) (JA 141). Even in the absence of such a

waiver, the Department noted, Bloch would not be entitled to

a deferred annuity under Section 810 because the statute

applied only to voluntary separations, and his separation in

November 1990 was involuntary.

Bloch then filed a grievance with the FSGB. He relied

principally on the Board’s decision in a redacted (and thus

untitled) 1983 case, No. G–083–054–AID–11 (FSGB 83–54),

which interpreted a Department regulation contained in 3

Foreign Affairs Manual (FAM) § 763.6. The regulation gov-

erns ‘‘separation for cause’’ (defined as ‘‘separation from the

Service because of the unsatisfactory performance of duties

or for such other cause as will promote the efficiency of the

Service,’’ id. § 761.2(i)), and states that ‘‘[a]n employee is free

to resign or retire at any time on a mutually agreed effective

date, and to have the employee’s reasons for resigning or

retiring entered’’ on the employee’s personnel record. Id.

6

§ 763.6(a). In FSGB 83–54, the Board considered the inter-

play between 3 FAM § 763.6 and the requirement in Section

811 that the Secretary consent to voluntary retirements. The

case involved an employee who had sought to retire after

removal proceedings had been initiated pursuant to Section

610 of the Act (codified as amended at 22 U.S.C. § 4010), a

general separation-for-cause provision that establishes proce-

dures for separating employees ‘‘for such cause as will pro-

mote the efficiency of the Service.’’ Id. § 4010(a)(1). In

FSGB 83–54, the Board determined that ‘‘[i]t is not necessary

TTTto decide in this case whether the statute [Section 811]

imposes any limits on the agencies’ power to grant or with-

hold consent to early retirement,’’ because ‘‘the agencies, by

regulation, have imposed such limitations on themselves.’’

FSGB 83–54 at 6–7 (citing 3 FAM § 763.6) (JA 150–51). The

Board concluded that, given the Section 763.6 regulation, the

employee could resign even without the Secretary’s consent,

and even though removal proceedings were pending against

him under Section 610. Id. at 7 (JA 151).

Bloch argued that because the Board had concluded that

‘‘an employee will be permitted to resign in the face of a

proposed separation for cause,’’ id., the Secretary had no

authority to withhold consent to Bloch’s retirement or his

receipt of an immediate annuity. As for the deferred annuity,

Bloch argued that his application for the refund of his contri-

butions could not be read as a waiver of his right to such an

annuity, because he did not know that there was any right to

waive: he applied for the refund after assuming (based on the

fact that the April 1992 letter described him as an employee

‘‘separated from the service without benefit of an annuity,’’

see Letter from John F.W. Rogers, supra, at 1 (JA 157)) that

he was not entitled to any annuity.

The FSGB denied Bloch’s grievance. As an initial matter,

the FSGB held that Bloch’s resignation was effective on the

day it was tendered (July 3, 1990) and that his separation

from the Service occurred on that day, rather than in Novem-

ber 1990 when the Department purported to remove him

from the Service. In re Bloch, FSGB Case No. 96–019 (Jan.

15, 1997), at 8–9 (JA 49–50) (Initial Board Decision). Such a

7

result, the Board stated, was compelled by 3 FAM § 751.1,

which provides that ‘‘[a]n employee is free to resign at any

time and to propose the effective date of resignation.’’ Id.

In a brief footnote, the Board described FSGB 83–54 as

holding that an employee can resign even when removal

proceedings are in progress. Initial Board Decision at 8–9

n.6 (JA 49–50). The Board added, however, that resignation

‘‘does not trigger entitlement to an annuity.’’ Id. at 9 (JA 50).

But the Board opted not to define the scope of the Secre-

tary’s authority to withhold consent to the annuity under

Section 811 of the Act, reasoning that ‘‘[s]uch a definition

would have profound implications.’’ Id. at 11 (JA 52). In-

stead, it focused on whether Bloch had waived his right to an

annuity. The Board first noted that the form Bloch used

when he applied for the refund of his retirement contributions

‘‘gave him clear notice that a refund would forfeit any entitle-

ment to an annuity’’ and ‘‘expressed no limitation on the type

of annuity being waived.’’ Id. at 12, 13 (JA 53, 54). More-

over, the Board observed that Bloch was ‘‘an experienced,

very senior officer’’ who was presumably able to make in-

formed and competent choices. Id. at 13 (JA 54). It also

pointed out that even during the two months between apply-

ing for the funds and receiving the refund check, Bloch could

have changed course and filed a grievance, but did not. Id.

The Board concluded that Bloch’s ‘‘waiver and forfeiture of

any entitlement to an annuity was unambiguous, valid, and

binding.’’ Id.

Bloch sought review of the Board’s decision in the District

Court for the District of Columbia, see 22 U.S.C. § 4140,

arguing that the FSGB had erred in failing to consider the

question whether the Secretary had discretion to withhold

consent to the immediate annuity. He pointed out that if he

were eligible to receive an immediate annuity when he ap-

plied for the refund, then Section 815(a)(1)(D) of the Act

(codified as amended at 22 U.S.C. § 4055(a)(1)(D)) — which

bars such refunds if the recipient becomes eligible for an

annuity within 31 days of filing the refund application —

raised a legal bar to the disbursement of the refund. Under

such circumstances, the refund (and thus, he argued, his

8

waiver of any entitlement to an annuity) would have been

unlawful and therefore invalid. The district court did not

reach the merits of this argument, but held that it was ‘‘an

argument that the Board should have addressed before reach-

ing its conclusion that Mr. Bloch’s waiver was valid and

binding,’’ Bloch v. Albright, 43 F. Supp. 2d 17, 21 (D.D.C.

1999), and thus remanded to the Board.

On remand, the Board resolved the issue that it had left

open in Bloch’s first grievance: the scope of the Secretary’s

authority under Section 811 of the Act. The Board concluded

that ‘‘the plain language ofTTTsection 811 confers broad dis-

cretionary authority upon the Secretary of State to grant or

withhold consent to the benefits available under that section.’’

In re Bloch, FSGB Case No. 99–026 (Mar. 30, 2000), at 23 (JA

316) (Decision on Remand). It then examined the two rea-

sons for withholding consent that the Department had listed

in its April 1992 letter to Bloch: the fact that he had been

removed from the Service involuntarily in November 1990,

and the fact that his removal was based on national security

concerns. The Board concluded that the first reason was

insufficient to warrant withholding consent to Bloch’s retire-

ment and annuity, because (as the Board had found in its

previous ruling) Bloch’s separation from the Service occurred

immediately upon his resignation in July 1990. Id. at 20, 25

(JA 313, 318). But the second reason was sufficient, in the

Board’s view: ‘‘[T]he serious national security con-

cernsTTTwhich prompted the filing of charges against

BlochTTTconstitute legitimate and rational grounds to support

and justify the Secretary’s withholding of consent to an

immediate annuity.’’ Id. at 25 (JA 318).

This holding defeated Bloch’s Section 815 argument: be-

cause the Secretary had validly denied an immediate annuity

for Bloch, he was not eligible to receive an annuity within 31

days of when he applied for his refund, so the refund was not

in violation of Section 815. Id. at 30–31 (JA 323–24). The

Board noted, however, that Bloch had remained entitled to a

deferred annuity under Section 810 of the Act, even after the

Secretary had withheld consent to the immediate annuity.

Id. at 25 (citing 3 FAM § 672.4) (JA 318); see also id. at 29

9

(JA 322) (‘‘The Department’s regulations make it clear that a

withholding of Secretarial consent to voluntary retirement

status with a consequential immediate annuity does not extin-

guish a right to a deferred annuity under section 810.’’). The

Board then restated its earlier conclusion that Bloch had

waived his right to this deferred annuity: ‘‘by submitting [the

refund application] with its clear warning language, together

with the receipt of his mandatory contributions, Bloch forfeit-

ed any entitlement to an annuity.’’ Id. at 27 (JA 320). The

Board finally discussed the argument that the Secretary’s

decision deprived Bloch of property without due process of

law; that argument failed, concluded the Board, because the

discretion accorded the Secretary in Section 811 precluded

the creation of a constitutionally protected property right to

an immediate annuity. Id. at 29 (JA 322).

Bloch again sought review in the district court, which

entered summary judgment in favor of the Department.

Bloch v. Powell, 227 F. Supp. 2d 25, 38 (D.D.C. 2002) (‘‘[A]c-

cording due deference to the FSGB, this court determines

that the FSGB’s decision is not arbitrary or capricious and

that the [Department] did not deny [Bloch]’s right to due

process.’’). This appeal followed. We review the FSGB

decision directly, ‘‘according no particular deference’’ to the

district court’s judgment. Holland v. National Mining

Ass’n, 309 F.3d 808, 814 (D.C. Cir. 2002).

II.

A. The Secretary’s Discretion to Withhold Consent

The crux of Bloch’s argument is that the Secretary did not

have the discretion to withhold consent to Bloch’s receipt of

an immediate annuity. Bloch concedes that Section 811 of

the Act vests the Secretary with significant discretion — as

indeed he must. The statute is perhaps a paradigmatic

vesting of unfettered discretion, placing no constraints on the

Secretary’s authority to withhold consent (other than to re-

quire that consent be withheld if an employee has served

fewer than five years, see 22 U.S.C. § 4051). But Bloch

10

argues that the Department’s regulations and its decision in

FSGB 83–54 have cabined the Secretary’s discretion.

As to the regulations, Bloch argues that 3 FAM §§ 751.1

(‘‘An employee is free to resign at any time and to propose

the effective date of resignation.’’) and 763.6(a) (‘‘An employee

is free to resign or retire at any time on a mutually agreed

effective date’’) limit the discretion of the Secretary to setting

a date for retirement, and eliminate any authority to withhold

an immediate annuity. The first provision concerns only

resignation, not retirement, and there is no longer any dis-

pute that Bloch’s resignation was effective despite the ab-

sence of Secretarial consent. As for the second provision, the

Department correctly explains that it cannot be read to

establish a right to retire ‘‘at any time’’ without regard to the

specific requirements for retirement detailed in applicable

statutes and regulations — age, length of service, and so on.

Indeed, the provisions spelling out those requirements note

that participants who meet the requirements for age and

length of service ‘‘may be retired on application and with the

consent of the participant’s agency from the Service with

entitlement to an immediate annuity.’’ 3 FAM § 672.1–1(a)

(emphasis added). The FSGB considered these arguments in

the Decision on Remand and ruled in favor of the Secretary,

noting the admonition in 3 FAM § 672.1–1b that Foreign

Service members planning to retire should ‘‘request the ap-

proval’’ of appropriate personnel officers. See Decision on

Remand at 24 (JA 317).

Bloch next argues that the Secretary’s discretion was cab-

ined by the Board’s decision in FSGB 83–54 and that the

Board’s Decision on Remand in this case is an unexplained

departure from FSGB 83–54 and therefore arbitrary and

capricious, in violation of the Administrative Procedure Act.

See 5 U.S.C. § 706(2)(A); see also Greater Boston Television

Corp. v. FCC, 444 F.2d 841, 852 (D.C. Cir. 1970). The Board

was certainly aware of FSGB 83–54 in its Decision on Re-

mand, relying on FSGB 83–54 to reiterate the conclusion in

the Initial Board Decision that the Department could not

reject Bloch’s resignation simply because it was seeking to

separate him under 5 U.S.C. § 7532. Decision on Remand at

11

20 n.2 (JA 313). The fact that removal proceedings were

pending for national security reasons under 5 U.S.C. § 7532

rather than under the general ‘‘efficiency of the Service’’

rubric of Section 610, as in FSGB 83–54, made no difference,

and it is indeed hard to imagine how the addition of national

security concerns could make the arguments in favor of

involuntary retention of the employee any more compelling

than they were in FSGB 83–54.

The right to an immediate annuity was — in the Board’s

view — a separate issue, because ‘‘merely leaving the rolls

through a resignation does not trigger eligibility and entitle-

ment to an annuity.’’ Id. at 20 (JA 313). As to this latter

issue, the Board concluded that the plain language of Section

811 of the Act confers broad discretion on the Secretary to

withhold consent to immediate annuities. Id. at 23 (JA 316).

In Bloch’s case, the Board found, ‘‘the serious national securi-

ty concerns harbored by his agency and which prompted the

filing of charges against Bloch — charges which he chose not

to contest — constitute[d] legitimate and rational grounds’’

for the Secretary to deny an immediate annuity. Id. at 25

(JA 318). Those concerns were not present in FSGB 83–54.

Our review under the arbitrary-and-capricious standard is

narrow; we will ‘‘uphold an agency decision ‘of less than ideal

clarity if the agency’s path may reasonably be discerned.’ ’’

Common Cause v. Federal Election Comm’n, 906 F.2d 705,

706 (D.C. Cir. 1990) (per curiam) (quoting Bowman Transp.,

Inc. v. Arkansas–Best Freight Sys., 419 U.S. 281, 286 (1974)).

The Board’s reasoning on the issue of the Secretary’s discre-

tion to withhold consent is more than sufficient to satisfy this

test; the Board adequately articulated the respects in which

it found the precedent in FSGB 83–54 controlling and the

respects in which it found the instant case different from

FSGB 83–54. The Board’s Decision on Remand was thus not

arbitrary or capricious.

B. Due Process

Bloch also presses the argument that the Secretary has

deprived him of property without due process of law. To

prevail, Bloch must first show that the interest he asserts is a

12

constitutionally protected property interest. Reeve Aleutian

Airways, Inc. v. United States, 982 F.2d 594, 598 (D.C. Cir.

1993) (citing Cleveland Bd. of Educ. v. Loudermill, 470 U.S.

532, 538–41 (1985)). The Supreme Court’s formulation in

Board of Regents of State Colleges v. Roth, 408 U.S. 564, 577

(1972), instructs that ‘‘[t]o have a property interest in a

benefit, a person clearly must have more than an abstract

need or desire for it. He must have more than a unilateral

expectation of it. He must, instead, have a legitimate claim

of entitlement to it.’’ The Court elaborated that property

interests are created and circumscribed ‘‘by existing rules or

understandings that stem from an independent source such as

state law — rules or understandings that secure certain

benefits and that support claims of entitlement to those

benefits.’’ Id.

Bloch argues that his interest in an immediate annuity

upon retirement from the Foreign Service is a protected

property interest. In his view, the Foreign Service Act, the

Department’s regulations implementing the Act, and the De-

partment’s conduct in prior cases combine to provide the

basis for a legitimate claim of entitlement to an immediate

annuity. As to the Act itself, Bloch relies primarily on

Congress’s stated desire to maintain conformity between the

Civil Service Retirement and Disability System and the For-

eign Service Retirement and Disability System. See 22

U.S.C. § 4067(a) (providing that laws that apply to the civil

service retirement system should generally be extended to

the foreign service retirement system). Given the parallel

nature of the two systems, Bloch argues, cases such as

American Postal Workers Union, AFL–CIO v. United States

Postal Serv., 707 F.2d 548, 554 (D.C. Cir. 1983) — which held

that a protected interest in retirement benefits arises when

an employee separates from the federal civil service — sup-

port his claim that he had a protected interest in an immedi-

ate annuity. He concedes that the statutes governing civil

service retirements do not contain language analogous to the

phrase ‘‘with the consent of the Secretary’’ in Section 811 of

the Foreign Service Act, but argues that those six words

13

cannot have the drastic consequence of negating a Foreign

Service employee’s property interest in an annuity.

Turning to the Department’s regulations, Bloch cites this

court’s observation in Kizas v. Webster, 707 F.2d 524, 539

(D.C. Cir. 1983), that in the context of federal employment,

regulations can create protected property interests. As for

the Department’s practices, Bloch emphasizes FSGB 83–54

and the Department’s own admission that no employee other

than Bloch had ever been denied a pension in the face of

separation proceedings. See Letter from Joanne M. Lish-

man, Director, Grievance Staff, U.S. Department of State, to

Herbert R. Rubenstein, Counsel for Felix Bloch (June 20,

1996), at 1 (JA 74). Given that this court has held that ‘‘[i]t is

possibleTTTfor a legitimate expectation to arise based upon

the consistent practice of a decisional body — even in the

absence of express regulatory language,’’ Tarpeh-Doe v. Unit-

ed States, 904 F.2d 719, 724 (D.C. Cir. 1990), Bloch argues

that the Department’s practices buttress his claim of entitle-

ment to an immediate annuity.

Bloch’s argument runs headlong, however, into a line of

precedent holding that when a statute leaves a benefit to the

discretion of a government official, no protected property

interest in that benefit can arise. In Washington Legal

Clinic for the Homeless v. Barry, 107 F.3d 32, 36 (D.C. Cir.

1997), this court held that when ‘‘the legislature leaves final

determination of which eligible individuals receive benefits to

the ‘unfettered discretion’ of administrators, no constitutional-

ly protected property interest exists’’ (quoting Roth, 408 U.S.

at 567). See also Dungan v. Slater, 252 F.3d 670, 676 (3d Cir.

2001) (federal employee had no protected interest in receiving

a waiver of a mandatory retirement rule because Congress

had granted broad discretion to the Secretary of Transporta-

tion to make decisions about such waivers); cf. Beitzell v.

Jeffrey, 643 F.2d 870, 874 (1st Cir. 1981) (Breyer, J.) (noting

that Roth and its progeny ‘‘provide no perfect touchstone for

identifying ‘property’ ’’ but at least ‘‘suggest that the more

circumscribed is the government’s discretionTTTto withhold a

benefit, the more likely that benefit constitutes ‘property’ ’’).

14

As we concluded in part II.A above, the Department’s

regulations and the Board’s decision in FSGB 83–54 did not

cabin the Secretary’s statutorily unbounded discretion to

withhold consent to an immediate annuity when national

security concerns prompt an employee’s separation from the

Service. To create a protected property interest, regulations

must limit discretion by ‘‘ ‘explicitly mandatory language,’ i.e.,

specific directives to the decisionmaker that if the regulations’

substantive predicates are present, a particular outcome must

follow.’’ Kentucky Dep’t of Corr. v. Thompson, 490 U.S. 454,

463 (1989); see also Tarpeh–Doe, 904 F.2d at 722–23. The

Department’s regulations do not do so.

Bloch’s heavy reliance on Garrott v. United States, 340

F.2d 615 (Ct. Cl. 1965) (en banc), is misplaced. He extracts

from Garrott the principle that ‘‘irrespective of whether the

interest is characterized as a ‘right,’ i.e., property, or a

‘privilege,’ i.e., subject to the discretion of the Secretary,’’ due

process is required before the government can act against an

individual’s substantial interests on loyalty or security

grounds. Reply Br. at 10. This principle is starkly at odds

with post-Garrott Supreme Court cases such as Roth and

Thompson, which make discretion the touchstone of the due

process analysis in the property context. Moreover, Garrott

and the cases on which it relies (such as Greene v. McElroy,

360 U.S. 474 (1959)) involved situations in which an employee

was not given a meaningful opportunity to respond to the

underlying allegations of national security violations; here, by

contrast, Bloch had the right to a hearing under Section 7532

but chose to waive that right.

The Secretary’s broad discretion to withhold consent to

retirement and an immediate annuity negates the existence of

any constitutionally cognizable property interest in Bloch, and

so his due process claim must be rejected. We emphasize

that our holding today does not mean, as Bloch has argued,

that employees of the Foreign Service have no property

interest in their retirement annuities. This case requires us

to determine only whether an employee has a protected

interest in an immediate annuity under Section 811 upon

resignation from the Service; the question whether employ-

15

ees have such an interest in a deferred annuity is not before

the court. In fact, the Department concedes that Bloch

would have been entitled to the deferred annuity had he not

withdrawn his contributions, and the statutory and regulatory

scheme indicates that the Secretary has no discretion with

respect to deferred annuities. See 22 U.S.C. § 4050 (defining

eligibility for deferred annuities without reference to any

requirement of obtaining consent of the Secretary); 3 FAM

§ 672.4 (stating that any participant who is not eligible for an

immediate annuity and who meets length-of-service require-

ments can elect a deferred annuity, with no reference to

consent); id. § 672.5–1(b) (same).1

C. Waiver of the Deferred Annuity

Bloch’s last argument is another APA claim: that the

FSGB acted arbitrarily and capriciously when it held that his

withdrawal of his compulsory retirement contributions in 1992

was a waiver of his right to receive a deferred annuity under

Section 810 of the Act. This court’s review is again highly

deferential; we are ‘‘not to substitute [our] judgment for that

of the agency’’ but must ‘‘consider whether the decision was

based on a consideration of the relevant factors and whether

there has been a clear error of judgment.’’ Southern Co.

Servs., Inc., v. FCC, 313 F.3d 574, 579–80 (D.C. Cir. 2002)

(quoting Motor Vehicle Mfrs. Ass’n v. State Farm Mut. Auto.

Ins. Co., 463 U.S. 29, 43 (1983)) (internal quotation marks

omitted).

1 The distinction between immediate and deferred annuities dem-

onstrates the weakness of another of Bloch’s statutory arguments.

He emphasizes that in Section 610 of the Act, Congress provided

that most employees who are separated for cause can elect an

annuity beginning at age 60 and established specific procedures that

must precede any separation for cause, creating a protected entitle-

ment to such an annuity. According to Bloch, it would be ‘‘per-

verse’’ to hold that employees who are separated for cause under

Section 610(b) have a property right in their annuities while ‘‘all

other Foreign Service employees’’ lack any property right in their

annuities. Appellant’s Br. at 17. It is clear, however, that any

property right created under Section 610(b) is a right to a deferred

annuity, not a right to an immediate annuity.

16

In this appeal, Bloch has not renewed the argument that

prompted the remand from the district court to the FSGB

earlier in these proceedings — that because he was eligible

for an immediate annuity at the time he applied for his

refund, Section 815 of the Act rendered the payment of the

lump sum unlawful (and any consequent waiver invalid).

Instead, Bloch’s principal argument is that his purported

waiver was made on the basis of incomplete information. He

points to the Department’s April 1992 letter, which mentioned

that he had the option of applying for a refund of his

contributions, but did not mention that he also had a different

option — leaving the contributions in place and receiving a

deferred annuity when he reached age 60. Bloch also empha-

sizes that when the Department rejected his first grievance in

February 1996 it stated (erroneously, it now concedes) that

‘‘there was no inchoate pension right which would ripen on

Mr. Bloch’s sixtieth birthday.’’ Letter from Ruth A. White-

side, supra, at 5 (JA 110).2

The FSGB addressed the waiver issue in both of its deci-

sions in Bloch’s case. The Initial Board Decision emphasized

that the application form gave Bloch ‘‘clear notice that a

2 At oral argument, counsel for Bloch emphasized the fact that

Section 810 of the Act, which governs eligibility for deferred

annuities, applies only to retirees who separate from the Service

voluntarily. Bloch could not have known that he was eligible for a

deferred annuity when he applied for the refund of his retirement

contributions, counsel argued, because the Department’s April 2,

1992 letter had made clear that the Department considered his

separation to be involuntary. (Only later, after the FSGB’s first

decision held that the Secretary had no right to refuse Bloch’s

resignation, was it certain that Bloch’s separation should be treated

as voluntary.) We cannot consider this argument because it was

not raised during the FSGB’s proceedings on remand from the

district court. See Wabash Valley Power Ass’n v. FERC, 268 F.3d

1105, 1108 (D.C. Cir. 2001). In any event, Bloch’s consistent

position from the outset was that his separation had in fact been

voluntary. See, e.g., Application for Retirement (July 3, 1990) (JA

163); Grievance of Felix Bloch to the FSGB (Apr. 17, 1996), at 10–

11 (JA 94–95). He should not have ignored the consequences of

being right.

17

refund would forfeit any entitlement to an annuity;’’ the

FSGB also observed that Bloch was an experienced officer

and that he had time, even after applying for the refund, to

change his mind and file a grievance to challenge the denial of

the immediate annuity. Initial Board Decision at 12, 13 (JA

53, 54). Bloch’s decision to waive the annuity, the Board

concluded, was ‘‘informed’’ and ‘‘intentional.’’ Id. at 13 (JA

54).

In the Decision on Remand, the Board found that the form

Bloch used to apply for the refund contained ‘‘readily observ-

able language’’ warning him that payment of the refund

would forfeit any annuity to which he may have been entitled.

Decision on Remand at 27 (JA 320). The Board also cited 3

FAM § 672.5 (entitled ‘‘Separation Without Annuity’’), which

provides that ‘‘[a]ny participant who is separated from the

Service with at least 5 years of creditable serviceTTTmay elect

to receive a lump-sum paymentTTTor to [leave] the contribu-

tions in the Fund and received a deferred annuity.’’ 3 FAM

§ 672.5–1(b). As the FSGB further noted, the regulation

then provides that ‘‘[a]n election to receive a lump-sum pay-

ment cannot be changed once it becomes final.’’ Id. More-

over, the misstatements in the February 1996 letter could not

have formed the basis of Bloch’s decision to withdraw his

retirement contributions in 1992, and thus are irrelevant in

deciding whether Bloch waived the deferred annuity at that

time.

We cannot say that the Board failed to consider the rele-

vant factors or made a clear error of judgment when it

concluded that Bloch had waived his right to a discontinued

service annuity; its decision thus was not a violation of the

APA.

III.

For the foregoing reasons, we affirm the judgment of the

district court.