U.S. Office of Special Counsel  1730 M Street, N.W., Suite 218  Washington, D.C. 20036-4505

Board: OSC Not Liable for Attorney Fees
In State/Local Hatch Cases

FOR IMMEDIATE RELEASE - 1/4/07
CONTACT: Loren Smith, 202-254-3714, lsmith@osc.gov
    
WASHINGTON, DC – The U.S. Office of Special Counsel prevailed on a significant legal issue before the Merit Systems Protection Board on December 4, 2006, when the Board ruled that OSC was not liable for attorney fees sought by respondents in state or local Hatch Act prosecutions.

      The case arose on July 21, 2006, when a city employee and his employer filed separate petitions seeking to recover attorney fees following OSC’s prosecution of the employee for violating the Hatch Act. Perkins was a high level employee of the sheriff's office near Las Vegas, was speaker of the state house, and was running for Governor of Nevada. Perkins and his Washington D.C. attorneys created a new agency organizational structure, walling Perkins off from those employees who worked in connection with the millions of dollars of federal money, for the sole purpose of allowing Perkins to run for election without technically violating the Hatch Act.

      In pursuing the case against Perkins, OSC tried to show that this was a subterfuge, but the Board affirmed that the evidence was insufficient to tie Perkins to the millions of dollars of law enforcement grants. Following the Board’s decision, Perkins and the sheriff’s department filed petitions to recover 600,000 dollars in attorney fees that were generated by two Washington, D.C. law firms.

      OSC objected to the petitions, arguing that Congress had not waived the Government’s sovereign immunity from such lawsuits, and that the respondents, therefore, were not entitled to recover attorney fees. The Administrative Law Judge assigned to the case initially rejected OSC’s arguments and found that Congress had waived the Government’s sovereign immunity. Because this finding involved an important question of law about which there were substantial grounds for a difference of opinion, the ALJ certified his decision to the Board for an immediate ruling on this issue of first impression.

      The Board unanimously agreed with OSC, finding that the statute under which respondents sought to obtain attorney fees did not apply to state and local Hatch Act prosecutions and that Congress had not otherwise waived the Government’s sovereign immunity to allow State or local employees and their employers to obtain attorney fees from OSC following unsuccessful Hatch Act prosecutions. As a result of the Board’s decision, the ALJ has now denied the respondents’ petitions for attorney fees.

      Special Counsel Scott Bloch said, “The Board correctly found that attorney fees are unrecoverable in state and local cases. This ruling will help ensure that all suspected violations of the Hatch Act are fully investigated and enforced where violations are found. Workplaces that are federal or federally-funded in nature should not be used for political advocacy or running for partisan elections.”

 

The U.S. Office of Special Counsel (OSC) is an independent investigative and prosecutorial agency. Among other functions, it investigates and prosecutes complaints alleging violations of the Hatch Act and provides advisory opinions regarding the Act’s requirements. For more information about OSC, please visit our web site at www.osc.gov or call 1-800-872-1855.
 

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