USCA1 Opinion

UNITED STATES COURT OF APPEALS

UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
FOR THE FIRST CIRCUIT

_________________________

No. 96-1460

ASTRID L. PORTELA-GONZALEZ, ET AL.,

Plaintiffs, Appellants,

v.

SECRETARY OF THE NAVY, ET AL.,

Defendants, Appellees.

_________________________

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF PUERTO RICO

[Hon. Jaime Pieras, Jr., Senior U.S. District Judge]

__________________________

_________________________

Before

Torruella, Chief Judge,

___________

Selya and Stahl, Circuit Judges.

______________

_______________________

Alex Gonzalez, with whom

______________

Gonzalez & Vilella

__________________

was on brief,

for appellants.
Isabel Mu oz Acosta, Assistant
___________________
whom Guillermo Gil, United
______________

United States Attorney, with

States Attorney,

appellees.

_______________________

was on

brief, for

March 26, 1997

_______________________

SELYA,
SELYA,

Circuit Judge.
Circuit Judge.
______________

In

this

appeal,

plaintiff-

appellant

Astrid

L.

Portela-Gonzalez

summary judgment entered

reasoning differs in

in favor

F.3d 502, 504 (1st

court

of the Navy.1

one salient respect

the court below, we affirm the

96

(Portela)

judgment.

Although

our

from that employed

by

See Hachikian v. FDIC,

___ _________
____

Cir. 1996) (explaining

is not committed to

challenges

the trial court's

that an appellate

rationale, but may

affirm on any alternative ground made manifest by the record).

I.
I.

BACKGROUND
BACKGROUND

The

uncontested.

facts

essential

Portela worked

civilian employee

for

at the Roosevelt

1985 forward, she occupied

Navy Exchange.

to

She had

our

nearly

review

are

three decades

Roads Naval

as

Station.

the position of sales manager

an unblemished

largely

From

at the

employment record

and

achieved consistently high performance ratings.

On

December 14,

clothing on layaway at

sale

items

(known

1989, Portela

placed 28

the Exchange, 25 of which

colloquially

The

anticipated purchase price of the merchandise was $484.10.

When

the prices of

drastically

during

the

opportunity

for

arrangement

(paying

tag"

all red tag items

post-Christmas lull,

increased

"red

were clearance

items).

the Exchange slashed

as

articles of

savings,

$5.00

Portela

canceled

penalty),

even more

and

spied an

her

layaway

simultaneously

____________________

1Portela's

husband,

conjugal partnership

Juan

are also

Enrique

Del

Valle,

and

plaintiffs; the Secretary

their

of the

Navy and the Naval Resale and Services Support Office (NRSSO) are
additional

defendants.

For simplicity's sake, we treat the case

as involving only Portela and the Navy.

repurchased the articles she had removed from layaway status

a price of $330.79.

not

for

Portela contends that these machinations did

transgress any policy, rule, or

regulation of the Exchange;

the Navy contends otherwise.

II.
II.

THE AFTERMATH
THE AFTERMATH

On April

9, 1990, L.H.

Charge (OIC) of the Navy Exchange,

Arcement, Jr., the

Officer in

suspended Portela without pay

pending

anticipated disciplinary

notified Portela

that she would

action.

On May

29, Arcement

be terminated for

"applying an

unauthorized 40% price reduction to red tagged clothing items you

had

placed on

policy,

layaway in

resulting

Pursuant to the

in

violation of

loss

to

the Exchange's

the

Exchange of

controlling administrative procedure,

in a Secretary of the

informed Portela

layaway

$197.32."2

contained

Navy Instruction (SECNAVINST), the

of the

charges against

her

letter

and outlined

her

procedural rights.

Portela contested the proposed disciplinary action.

June

22,

1990,

the

OIC

terminated her employment

overrode

Portela's

as of July 3, 1990.

grievance

On

and

The Navy advised

Portela of her right to appeal this decision and she proceeded to

do so.

Her first

appeal was heard pro forma by the OIC who, not

___ _____

surprisingly, affirmed

his original

determination.

Her second

appeal culminated in a

full evidentiary hearing, following which

____________________

2While simple
the
sheds

arithmetic indicates

vicinity of 40% of
no further light

that this figure

the original purchase

on its genesis.

is in

price, the record

We need

not probe the

point, however, because Portela does not challenge the amount.

Michael F. O'Brien, the Commanding Officer of the Roosevelt Roads

Naval Station, upheld her termination.

Portela

level.

On

pursued

March

25,

the

1991,

appellate

Rear

process to

Admiral

H.D.

the

next

Weatherson,

Commander of the NRSSO, headquartered at Staten Island, New York,

affirmed her

right

to

termination.

take

final

This decision informed Portela of her

administrative appeal

to

the

Deputy

Assistant Secretary of the Navy, Civilian Personnel Policy, Equal

Employment Opportunity

Office, in Washington, D.C.

Rather than

pursue this fourth level of administrative redress, Portela filed

suit.

After some preliminary

the

district

court

addressed

skirmishing, not relevant here,

the Navy's

motion

for

summary

judgment.

The

court ruled

available

administrative remedies

merits of her suit

that Portela had

but

failed to

exhaust

nonetheless reached

in the exercise of its

the

perceived discretion.

See Portela Gonzalez v. Secretary of Navy, 913 F. Supp. 122, 126___ ________________
_________________

28 (D.P.R.

as

the

1996).

Portela's victory

court concluded

arbitrary nor capricious.

III.
III.

that

proved ephemeral, however,

the Navy's

See id. at 128.

___ ___

actions

were neither

This appeal ensued.

DISCUSSION
DISCUSSION

We

agree

with

the

district

court

that

Portela

impermissibly failed to exhaust

her administrative remedies.

disagree,

court

however,

circumstances

omission.

that

the

of this case,

had

to relieve her

discretion,

of the

in

We

the

onus of her

A.
A.

Starkly

"no

one is

The Exhaustion Doctrine.

The Exhaustion Doctrine.
_______________________

contoured, the exhaustion

entitled

to

judicial

relief

doctrine holds that

for

threatened injury until the prescribed administrative

been exhausted."

supposed

or

remedy has

Myers v. Bethlehem Shipbuilding Corp., 303 U.S.

_____
____________________________

41, 50-51 (1938).

than this

Pierce,

ed.

In

practice, the doctrine

language implies.

absolutely

Although exhaustion

required

if

McCarthy v. Madigan, 503

________
_______

latitude in

remained

15.2,

of administrative

explicitly

mandated by

Darby v.
_____

Cisneros, 509
________

144.

at 307 (3d

remedies is

Congress,

U.S. 140, 144 (1992), courts

(1993); McCarthy, 503 U.S. at

________

of

Treatise
________

dealing with exhaustion questions

silent, see
___

edges

See Kenneth Culp Davis & Richard J.

___

Jr., II Administrative Law

______________ ___

1994).

has softer

see
___

have more

when Congress has

U.S.

137, 153-54

In such purlieus, the

court

first instance possesses a modicum of discretion to relax the

exhaustion

requirement.

See
___

Salus
_____

v.

Corp., 104 F.3d 131, 138 (7th Cir. 1997).

_____

GTE Directories Serv.

______________________

The

understanding

Court's

opinion in

of the

parameters of

recognizing that the

McCarthy
________

is

integral to

this discretion.

exhaustion doctrine ordinarily

twin purposes of protecting

Although

"serves the

administrative agency authority

promoting judicial efficiency," and,

an

and

thus, should customarily be

enforced, the Court identified "three broad sets of circumstances

in which

the interests of

the individual weigh

requiring administrative exhaustion."

146.

heavily against

McCarthy, 503 U.S. at 145,

________

First,

unreasonable or

a court

may

consider relaxing

indefinite delay

threatens unduly

the subsequent bringing of a judicial action.

And,

relatedly,

plaintiff

may

if the

suffer

situation

irreparable

the rule

is such

harm

if

when

to prejudice

See id. at 146-47.

___ ___

that

"a particular

unable

to

secure

immediate judicial consideration of his claim," exhaustion may be

excused even though

"the administrative decisionmaking

is otherwise reasonable and definite."

schedule

Id. at 147.
___

Second, McCarthy acknowledges that

________

it sometimes may be

inappropriate for a court to require exhaustion if a

doubt

exists about

whether

meaningful redress.

Berryhill,
_________

example,

411

may

requested.

is

See id. at 147-48, 154;

___ ___

U.S.

lack

the agency

564, 574

authority

See, e.g.,
___ ____

n.14

to

empowered to

grant

see also Gibson v.

___ ____ ______

(1973).

grant

substantial

An agency,

the

type

McNeese v. Board of Educ.,

_______
______________

of

for

relief

373 U.S. 668,

675 (1963).

Finally, McCarthy teaches that the

________

be relaxed where there

of administrative taint.

biased or can be

to exploit

exhaustion rule may

are clear, objectively verifiable indicia

Thus, if the potential decisionmaker is

shown to have predetermined the

an available

administrative remedy may

See McCarthy, 503 U.S. at 148.

issue, failure

be forgiven.

___ ________

B.
B.

Application of the Doctrine.

Application of the Doctrine.
___________________________

Congress has excluded Navy Exchange

strictures of the

2105(c),

and

personnel from the

Administrative Procedure Act,

has not

otherwise

mandated

see 5 U.S.C.
___

that such

employees

always

must

exhaust

administrative

remedies

as

condition

precedent to

suit.

exercise the

final level

not

Accordingly, Portela's admitted

of available administrative

necessarily fatal to her

depends

failure to

instead upon whether

claim; the effect

review is

of her omission

the circumstances of

her case can

justify that omission.

1.
1.

this phase

argument,

level

The Availability of Fourth-Level Review.

The Availability of Fourth-Level Review.
________________________________________

of our

analysis by addressing

raised for

the first

of review was not in fact

time on

We start

Portela's halfhearted

appeal, that

available to her.

a fourth

The argument

is bogus.

The facts are as

follows.

The original administrative

procedure, SECNAVINST 5300.22A, did not mention a fourth level of

review.

On November 15, 1989, however, the Secretary of the Navy

promulgated SECNAVINST 5300.22B,

to implement it within

directing subordinate

120 days.

The new

regulation (5300.22B)

explicitly canceled the old regulation (5300.22A).

on January 24, 1990, the

Management,

granted an

commands

Nevertheless,

Director, Officer of Civilian Personnel

extension

to the

NRSSO, deferring

effective date of SECNAVINST 5300.22B until July 15, 1990.

the notice of

and

Thus,

suspension issued to Portela on April 9, 1990, the

notice of proposed disciplinary

1990,

the

the

notice of

action issued to her on

decision

dated

June

May 29,

22, 1990,

all

referenced SECNAVINST 5300.22A as the controlling regulation.

From

understood

that

indeed,

point

urged

forward,

that

however,

Portela

SECNAVINST 5300.22B,

clearly

which

unarguably

contains a

governed her case.

August

12, 1990,

fourth

level

of administrative

She mentioned it in her second appeal, dated

and

at the

ensuing

evidentiary hearing

counsel insisted that 5300.22B, rather than

her

case.

question,

While

the

review,

the

ultimate

hearing

officer

decisionmaker

her

5300.22A, controlled

did

at

not rule

that

on

level

the

(the

Commanding Officer of the Roosevelt Roads Naval Station) accepted

Portela's

argument

and

reviewed

the

accordance with SECNAVINST 5300.22B.

the

administrative

process,

hearing

transcript

in

Throughout the remainder of

both

sides proceeded

under

that

regulation.3

We do

not aspire

terms, SECNAVINST

to add

hues to a

5300.22B applies

here.

rainbow.

And,

By its

moreover, since

Portela consistently argued for its application during the latter

stages

of the administrative process, she cannot now be heard to

complain

Equitable

judicial

13.5,

and

that

the

doctrines

agency

of

surrendered

estoppel

apply in

fora, see generally Davis

___ _________

a party

cannot take

administrative proceeding

to

one

and then

her

exhortation.

administrative

& Pierce, supra,

_____

and

13.1 to

position in

an underlying

disclaim it in

a subsequent

suit arising out of the agency proceedings.

Cf. Patriot Cinemas,

___ ________________

Inc. v. General Cinema Corp., 834 F.2d 208, 212 (1st

____
_____________________

Cir. 1987)

____________________

3We cite two episodes which confirm this conclusion.

third-level

notice of

appeal,

Portela

stated

expressly

"[t]his appeal arises under SECNAVINST 5300.22B."

in

resolving

commandant

that

appeal

specifically

adversely

informed

to

Portela

fourth-level appeal under SECNAVINST 5300.22B.

that

By like token,

Portela,
of her

In her

the
right

NRSSO
to

(explaining that

party

the doctrine of judicial

estoppel "precludes a

from asserting a position in one legal proceeding which is

contrary to a position it has already asserted in another").

2.
2.

The Futility Exception.

The Futility Exception.
_______________________

remains is whether Portela's

The only

question that

failure to mount the final

the administrative ladder is fatal to the court case.

below

that the

court should

excuse her

rung of

She argued

omission, asseverating

that a final appeal to the Deputy Assistant Secretary of the Navy

would have been a

futile gesture because it would

in an automatic affirmance of her dismissal.

good argument.

McCarthy Court,

Consistent

we

have

In theory, this is

with the exceptions

recognized

the

have resulted

limned by the

inappropriateness

of

________

requiring

futile.

184,

exhaustion when

proceedings

would be

See, e.g., Pihl v. Massachusetts Dep't of Educ., 9 F.3d

___ ____ ____
____________________________

190

Comm.,
_____

further agency

(1st Cir.

877

F.2d

1993);

1089,

Christopher W.
______________

1095

(1st

Cir.

v.

Portsmouth Sch.
_______________

1989);

Ezratty
_______

v.

Commonwealth of P.R., 648 F.2d 770, 774 (1st Cir. 1981).

____________________

But

asking.

the futility

Reliance on

the

exception is

not available

for the

exception in

must be

anchored in demonstrable reality.

hunch

that

further

given case

A pessimistic prediction

administrative

proceedings

will

unproductive is not enough to sidetrack the exhaustion rule.

Christopher W., 877 F.2d

______________

or a

prove

See
___

at 1095-96; see also Gilbert v. City of

___ ____ _______
_______

Cambridge, 932 F.2d 51, 61 (1st Cir. 1991) (admonishing that "the
_________

mere possibility,

or even the probability,

that the responsible

agency may deny [a]

permit should not

[futility exception]").

Accordingly,

be enough to trigger

the

"[a]n essential element of

the claim of futility . . . is

that all reasonable possibilities

of

relief

adequate

administrative

have

been

effectively

foreclosed."

Tucker
______

v.

Defense
Mapping
Agency
_____________________________

Hydrographic/Topographic Ctr., 607

______________________________

1985).

seek

Indeed, the

F. Supp. 1232,

Seventh Circuit has held that

1243 (D.R.I.

claimants who

safe harbor under the futility exception "must show that it

is certain that their claim will be denied on appeal,

that they doubt an

Smith v.
_____

appeal will result in a

not merely

different decision."

Blue Cross & Blue Shield United, 959 F.2d 655, 659 (7th
_______________________________

Cir. 1992).4

Portela

futility

is

cannot surmount

merely

circumstances of

this

self-serving

this case.

the Deputy Assistant Secretary

hurdle.

The claim

pronouncement

in

of

the

The evidence is uncontradicted that

is an impartial official

reversed termination decisions affecting Navy

who has

Exchange personnel

in

the

past.

Though

administrative

modest,

appeal may

neither

courts

pessimism with futility.

424

the

(5th Cir. 1974).

prognosis

have been

nor

See
___

for

Portela's

poor and

litigants are

unused

her expectations

allowed

to

equate

Hodges v. Callaway, 499 F.2d 417,

______
________

Because there

is nothing in the record to

____________________

4For

our part, we are tempted to set the benchmark slightly

below absolute certainty, cf.

___
within the exception, a
prospect
case

does not

("To come

sort of inevitability is required:

of refusal must be

at hand

Gilbert, 932 F.2d at 61

_______

certain (or nearly

require us to

formulations.

10

the

so)."), but the

choose between

these two

suggest

that Portela's lack of success at the previous levels of

review necessarily signified that the final level of review would

be

an

empty

administrative

gesture,

remedy

her

failure

cannot be

to

exhaust

overlooked

on

an

available

the ground

of

futility.

3.
3.

The District Court's Rationale.

The District Court's Rationale.
______________________________

are in agreement with the court below.

at

126-27

(declaring

that

Portela's nonexhaustion).

alleged

To this point, we

See Portela, 913 F. Supp.

___ _______

futility

did

not

excuse

After finding the plaintiff's futility

argument futile, however, the district

to

relax

the

exhaustion

judge nonetheless elected

requirement "[i]n

the

interests

of

minimizing cost and delay in the judicial system and avoiding the

waste

of resources."

perceived waste

excusing

of

Id. at
___

127.

resources, in

nonexhaustion of

The judge

and

reasoned that a

of itself,

administrative

can

remedies.

justify

We

think

not.5

Were

we

to adopt

the

lower

court's reasoning,

the

resulting exception would swallow the exhaustion rule in a single

gulp.

Once

retreat

an aggrieved party has brought suit,

to any
___

unused administrative appeal

forcing her to

potentially wastes

____________________

5To

be

sure, we

stated

in Ezratty

that

"[s]ometimes to

_______
require exhaustion
severe harm
context, this

upon

will not only

a litigant."

statement is

prejudice/irreparable

waste resources but

also work

648 F.2d

Taken

at

774.

entirely compatible with

harm"

consideration

in

the "undue

outlined

by

the

McCarthy Court in its discussion of the first potential exception

________
to the exhaustion rule.
there is no

503 U.S. at 146-47.

hint that taking

In the case at bar,

an appeal to the

Deputy Assistant

Secretary would have caused Portela irreparable harm or otherwise

seriously prejudiced her rights.

11

resources.

The

Supreme Court has

disavowed such

a resupinate

approach.

In McKart
______

the Court

explained that a

doctrine

is

v. United States, 395 U.S. 185, 193 (1969),

_____________

"primary purpose" of

"the avoidance

administrative

of

process."

inefficient to permit a

first exhausting her

premature

the exhaustion

interruption of

Consequently,

it

is

generally

party to seek judicial recourse

administrative remedies.

the

without

See id. at
___ ___

194.

Following this train of thought, the Court has concluded that, by

and large,

rather

than

doctrine.

195;

concerns regarding

against,

See
___

strict

application

McCarthy, 503 U.S.

________

see also Ezratty, 648

___ ____ _______

exhaustion

efficiency militate in

doctrine "serves

at 145;

F.2d at 774

interests of

agency autonomy and judicial economy").

of

the

favor of,

exhaustion

McKart, 395 U.S.

______

at

(acknowledging that the

accuracy, efficiency,

This view

on exhaustion

seriously,

judicial

forces parties to take

allows

correct their

is steeped in real-world

administrative

own errors,

involvement

available

into overcrowded courts and

Insisting

administrative proceedings

agencies

and potentially

altogether.

administrative

wisdom.

an

opportunity

avoids the

Furthermore,

processes thrusts

to

need for

disregarding

parties prematurely

weakens an agency's effectiveness by

encouraging end-runs around it.

See McCarthy, 503 U.S.

___ ________

at 145;

McKart, 395 U.S. at 195.

______

4.
4.

is

The Bottom Line.

The Bottom Line.
_______________

unavailable to

reason

for

Portela

excusing

her

To sum up, the futility exception

and the

failure

district court's

to

exhaust

professed

administrative

12

remedies

any

neither passes muster on its own terms nor falls within

of the

dictate

hallmark

the result

McCarthy exceptions.6
________

we

available administrative

case, howsoever

must

reach.

The

Those

plaintiff

remedy untapped and the

construed,

reveals no

left

an

record in this

sufficiently

circumstances to warrant spurning that remedy.

conclusions

excusatory

First,

would have

there

is

no indication

sort.

Although Portela had

fairly lengthy administrative process, it

as

Rear

began when the OIC

of July 3, 1990, and

Admiral Weatherson,

appeal on March

harm, or unusual

already pursued

terminated Portela's employment

denied her

and the

in the person of

penultimate administrative

Deputy Assistant

to respond to her final

namely,

SECNAVINST

Second, the agency (here, the Navy) was

fully capable of granting all

sought,

Secretary

appeal "within

calendar days of receipt of the official record."

5300.22B Ch.V (9)(d)(3).

had moved celeritously

ended when the NRSSO,

25, 1991

would have been required

60

full exhaustion

caused undue prejudice, irreparable

hardship of any

the pavane

that

the relief that Portela originally

reinstatement, reassignment,

and

quashing the

charges against her.

Third, there is no meaningful indication of

any institutional bias.

any

other

special

Fourth, the plaintiff has not identified

circumstance warranting

relaxation

of

the

exceptions

to

the

____________________

6We
exhaustion

do

not

suggest

that

rule delineated

exclusive compendium.

by

But to

the

three

the McCarthy
________
the extent that

appropriately may lie, they must be on a

described by the
here

Court.

contains nothing

As

further exception.

13

an

other exceptions

par with the exceptions

explained in the

which suggests

Court comprise

text, the

plausible basis

record

for a

exhaustion

rule, and

reveals none.

dismissed

our

careful perlustration

It follows

that the district

the complaint for failure of

of the

record

court should

have

the plaintiff to exhaust

available administrative remedies.

IV.
IV.

CONCLUSION
CONCLUSION

It may

seem hypertechnical to

believes herself aggrieved by

series of

weigh

exhaustion

of administrative

done, our

seek out a judicial

regarding agency autonomy

efficiency

heavily

system of justice

person who

agency action must jump

hoops before she can

long-recognized concerns

some that a

in

favor

remedies.

of

forum.

depends on litigants'

But

and judicial

requiring

When all

through a

complete

is said

and

adherence to

well-defined rules.

Where, as here, a party decides unilaterally

to forsake those rules, she does so at her peril.

We need go no further.

lacked a legally sufficient

judicial venue.

her complaint

remedies.

The short of it is that Portela

reason for leaping prematurely

Thus, the district court should

for

failure to

In the end, however,

exhaust available

to a

have dismissed

administrative

the district court's error is of

no moment; though the court entered judgment in favor of the Navy

on

an inappropriate ground, the Navy

judgment.

Affirmed.
Affirmed.
________

is nonetheless entitled to

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