Director of the Office of Personnel Management v. Ronald L. Moulton, Merit Systems Protection Board

United States Court of Appeals
for the Federal Circuit
______________________
DIRECTOR OF THE OFFICE OF PERSONNEL
MANAGEMENT,
Petitioner
v.
RONALD L. MOULTON, MERIT SYSTEMS
PROTECTION BOARD,
Respondents
______________________
2024-1774
______________________
Petition for review of the Merit Systems Protection
Board in No. DE-0841-18-0053-I-1.
______________________
Decided: October 10, 2025
______________________
K YLE SHANE BECKRICH , Commercial Litigation Branch,
Civil Division, United States Department of Justice, Wash-
ington, DC, argued for petitioner. Also represented by
ELIZABETH M ARIE HOSFORD, P ATRICIA M. MCCARTHY ,
YAAKOV R OTH ; ROXANN SAMANTHA J OHNSON , Office of Gen-
eral Counsel, Office of Personnel Management, Washing-
ton, DC.
EVAN J ENNINGS MANN, Munger, Tolles & Olson LLP,
San Francisco, CA, argued for respondent Ronald L.
Moulton. Also represented by G INGER A NDERS , RACHEL
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OPM v. MOULTON 2
MILLER-ZIEGLER, Washington, DC.
D EANNA SCHABACKER , Office of the General Counsel,
United States Merit Systems Protection Board, Washing-
ton, DC, argued for respondent Merit Systems Protection
Board. Also represented by ALLISON J ANE BOYLE,
K ATHERINE M ICHELLE SMITH .
______________________
Before P ROST , WALLACH , and CHEN, Circuit Judges.
P ROST , Circuit Judge.
The Director of the Office of Personnel Management
(“OPM”) petitions for review of a final order of the Merit
Systems Protection Board (“Board”).1 This case presents a
purely legal question of statutory interpretation—whether,
under 5 U.S.C. §§ 8421(c) and 8467(a), OPM apportions the
annuity supplement only when the terms of a court order
(e.g., a divorce decree) expressly provide for division of the
supplement. For the reasons below, we conclude that OPM
cannot divide a retiree’s annuity supplement unless the di-
vision of the supplement is expressly provided for in a court
order. Thus, we affirm.
BACKGROUND
I
Before turning to the facts of this case, we provide a
summary of the relevant statutory scheme—the Federal
Employees’ Retirement System Act (“FERS”). In 1986,
Congress enacted FERS, Pub. L. No. 99-335, 100 Stat. 514
(1986), as a successor to the retirement benefits scheme for
federal employees under the Civil Service Retirement
1 This court granted OPM’s petition for review under
5 U.S.C. § 7703(d). OPM v. Moulton, No. 24-109, 2024 WL
1953955, at *1 (Fed. Cir. May 3, 2024).
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OPM v. MOULTON 3
System. FERS generally provides a three-part plan for fed-
eral retirees: (1) Social Security benefits, (2) a Thrift Sav-
ings Plan (a retirement savings and investment plan
similar to 401(k) plans available to private-sector employ-
ees), and (3) a basic annuity payment.
Some federal employees retire before the age of sixty-
two and thus do not have access to their Social Security
benefits immediately upon retirement. As a result, these
retirees may receive an annuity supplement until they
reach the minimum age to qualify for Social Security ben-
efits. 5 U.S.C. § 8421(a). The supplement is approximately
the same value of the Social Security benefit a retiree may
receive starting at age sixty-two. Id. § 8421(b).
Congress recognized that a retiree might allocate some
portion of his or her benefits to a former spouse. Section
8467(a) provides that “[p]ayments under this chapter
which would otherwise be made to an employee . . . shall
be paid (in whole or in part) . . . to another person if and to
the extent expressly provided for in the terms of– (1) any
court decree of divorce, annulment, or legal separation, or
the terms of any court order or court-approved property
settlement agreement incident to any court decree of di-
vorce, annulment, or legal separation.” Id. § 8467(a) (em-
phasis added). Section 8421(c) provides that annuity
supplements “be treated in the same way as” the basic an-
nuity. Id. § 8421(c).
Before 2016 and for almost thirty years, “OPM did not
include the [a]nnuity [s]upplement in the calculation of an-
nuity benefits to be paid to a former spouse, except under
certain circumstances where the state court order expressly
addressed the [a]nnuity [s]upplement.” J.A. 182 (emphasis
added). “OPM previously considered the [a]nnuity [s]up-
plement to be a Social Security-type benefit and thus not
allocable as between former spouses.” Id.
In 2016, OPM “reverse[d]” the way it apportioned an-
nuity supplements. Id. This change caused the Federal
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OPM v. MOULTON 4
Law Enforcement Officers Association to “raise[] concerns
that OPM’s non-public change was made without prior no-
tice.” Id. Under OPM’s new interpretation, if a court order
required that basic annuity be divided, then the retiree’s
annuity supplement must also be divided the same way,
even if the court order did not expressly provide that the
supplement should be divided. OPM implemented these
changes despite its own Office of the Inspector General con-
cluding that “OPM may not adopt or apply this change
without undergoing notice and comment rulemaking.”
J.A. 194; see also J.A. 4–6. OPM characterized its new in-
terpretation as correcting an “operational error.” Oral Arg.
at 1:20–31, 7:22–8:24.2 OPM also applied its new interpre-
tation retroactively—again, despite OPM’s Office of the In-
spector General reporting that “OPM lacks the authority
to” do so. J.A. 197.
II
Mr. Moulton is a former air traffic controller with the
Department of Transportation. He divorced from his ex-
wife, Jill Moulton, in July 2004. J.A. 1, 23. A Colorado
state court issued a “Decree of Dissolution of Marriage”
stating in relevant part that Ms. Moulton was entitled to a
“pro[ ]rata share” of Mr. Moulton’s “gross monthly annuity”
and “any benefit [he] earn[ed] based on [his] special [Air
Traffic Controller] service.” J.A. 119, 120 ¶ 6.3 The decree
2 No. 24-1774, https://www.cafc.uscourts.gov/oral-
arguments/24-1774_08082025.mp3.
3 OPM uses the terms “gross annuity,” “gross
monthly annuity,” and “basic annuity” interchangeably to
refer to the basic annuity. J.A. 190 n.30; see also 5 C.F.R.
§ 838.103 (defining “[g]ross annuity”). The divorce decree
explicitly adopted the terminology of 5 C.F.R. part 838,
J.A. 119–20 ¶ 3, and the relevant section is almost identi-
cal to the model language provided in 5 C.F.R. part 838,
subpart F, Appendix A ¶ 204.
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OPM v. MOULTON 5
did not explicitly mention allocation of his annuity supple-
ment.
Mr. Moulton retired in May 2010 at age forty-seven.
Because he was younger than sixty-two, he was entitled to
and received an annuity supplement under 5 U.S.C.
§ 8421.
On August 25, 2016, OPM issued a letter to
Mr. Moulton informing him that it had miscalculated the
amount owed to his ex-wife and that he owed her nearly
$25,000. J.A. 90–91. The letter stated that his payments
will be reduced by $250 per month going forward (except
the final installment, which will be reduced by $35.30).
Id.4 Mr. Moulton requested reconsideration of OPM’s deci-
sion, but OPM affirmed its initial decision. J.A. 25. Mr.
Moulton eventually challenged OPM’s decision at the
Board.5 J.A. 25–26. The administrative judge rejected
OPM’s reinterpretation and concluded § 8421(c) requires
OPM to divide an annuity supplement only if expressly pro-
vided for in a court order. See J.A. 35–36.
OPM petitioned the Board for review. The Board de-
nied OPM’s petition and affirmed the administrative
judge’s decision. Moulton v. OPM, No. DE-0841-18-0053-I-
1, 2023 WL 8254628 (M.S.P.B. Nov. 28, 2023). OPM then
timely petitioned this court for review. We have jurisdic-
tion under 28 U.S.C. § 1295(a)(9).6
4 OPM has since waived collection of the overpay-
ment (nearly $25,000) to Mr. Moulton. Pet’r’s Br. 5 n.2.
5 There were several intervening events between
when OPM issued its reconsideration decision and when
Mr. Moulton challenged OPM’s decision at the Board that
are not relevant to this appeal.
6 This court stayed “the Board’s November 28, 2023
opinion and order . . . until further notice of this court.” Or-
der at 2 (Apr. 21, 2025), ECF No. 49.
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OPM v. MOULTON 6
D ISCUSSION
We review a Board decision for whether it is “(1) arbi-
trary, capricious, an abuse of discretion, or otherwise not
in accordance with law; (2) obtained without procedures re-
quired by law, rule, or regulation having been followed; or
(3) unsupported by substantial evidence.” 5 U.S.C.
§ 7703(c). This case presents an issue of statutory inter-
pretation, which we review de novo. O’Farrell v. Dep’t of
Def., 882 F.3d 1080, 1083 (Fed. Cir. 2018).
The question before us is whether, under 5 U.S.C.
§§ 8421(c) and 8467(a), OPM may apportion a federal re-
tiree’s annuity supplement only when expressly provided
for in a court order. OPM answers in the negative; Mr.
Moulton and the Board in the affirmative. For the follow-
ing reasons, we agree with Mr. Moulton and the Board and
conclude that the statutory text demands—and the statu-
tory scheme and history confirm—OPM apportion a re-
tiree’s annuity supplement only when expressly provided
for in a court order.
I
We begin our analysis with the statutory text. See
Lackey v. Stinnie, 604 U.S. 192, 199 (2025). Section 8467(a)
is the first of two statutory provisions at the heart of this
dispute. That section, titled “Court orders,” states in rele-
vant part that “[p]ayments under this chapter . . . shall be
paid (in whole or in part)” to the former spouse if “expressly
provided for in the terms of . . . any court decree of divorce,
annulment, or legal separation, or the terms of any court
order or court-approved property settlement agreement in-
cident to any court decree of divorce, annulment, or legal
separation.” 5 U.S.C. § 8467(a).
The other statutory provision at the heart of this dis-
pute is § 8421, titled “Annuity supplement,” which refer-
ences § 8467 and states:
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OPM v. MOULTON 7
An amount under this section shall, for purposes of
section 8467, be treated in the same way as an
amount computed under section 8415.
5 U.S.C. § 8421(c) (emphasis added).
Section 8421(c), thus, sets forth a rule for apportioning
the annuity supplement. It refers to two different
amounts, using two different phrases. Compare id. (“[a]n
amount under this section,” i.e., an annuity supplement),
with id. (“an amount computed under section 8415,” which
governs the computation of the basic annuity). The statute
then establishes the relationship between these two
amounts—the annuity supplement “shall . . . be treated in
the same way” as the basic annuity amount. Id.
Around the time FERS was enacted, American Herit-
age Dictionary defined “treat” to mean “regard or consider
in a certain way.” Treat, American Heritage Dictionary (2d
college ed. 1982); see also Treat, American Heritage Dic-
tionary (3d ed. 1992) (“To regard and handle in a certain
way”). It also defined “way” as a “manner of doing some-
thing,” like for example, there are “several ways of solving
this problem.” Way, American Heritage Dictionary (2d col-
lege ed. 1982); see also Way, American Heritage Dictionary
(3d ed. 1992) (“A manner or method of doing”).
In the context of § 8421(c), therefore, the phrase “shall
. . . be treated in the same way” means that the annuity
supplement shall be regarded (or handled) using the same
manner (or method) as the basic annuity. The basic annu-
ity is apportioned to another person only if apportionment
is “expressly provided for” in a court order. 5 U.S.C.
§ 8467(a). To treat annuity supplements “in the same way”
means that the supplement may be apportioned only if ex-
pressly provided for in a court order.
Section 8421(c) also states that the annuity supple-
ment “for purposes of section 8467” will be treated in the
same way as the basic annuity. This language provides
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OPM v. MOULTON 8
context and additional clarity for OPM to follow the proce-
dural requirements of § 8467 (among them, that a payment
must be “expressly provided for”) as to annuity supple-
ments. See Fort Stewart Schs. v. FLRA, 495 U.S. 641, 646
(1990) (provisions that, although “technically unneces-
sary,” are sometimes “inserted out of an abundance of cau-
tion—a drafting imprecision venerable enough to have left
its mark on legal Latin (ex abundanti cautela).” (italics in
original)).
II
The broader statutory scheme further supports
Mr. Moulton’s and the Board’s interpretation. See City &
Cnty. of San Francisco v. EPA, 604 U.S. 334, 350 (2025) (“It
is a fundamental canon of statutory construction that the
words of a statute must be read in their context and with a
view to their place in the overall statutory scheme.”
(cleaned up)). First, the annuity supplement was created
for early retirees who are not yet eligible to receive their
Social Security benefits. For nearly thirty years and until
2016, OPM viewed the supplemental annuity as a Social
Security-type benefit, which was presumptively not alloca-
ble between former spouses. Only a “state court order
[that] expressly addressed the [a]nnuity [s]upplement”
could result in division. J.A. 182; see also J.A. 192;
Mr. Moulton’s Br. 4; Board’s Br. 6 n.4.
Second, Congress has shown that it knows how to spec-
ify when annuity supplements will be included in any an-
nuity division. When Congress enacted the FERS
provisions at issue here, Congress also addressed the treat-
ment of annuities for Central Intelligence Agency (“CIA”)
employees. Section 506 of FERS amended the CIA Retire-
ment Act of 1964, allowing certain CIA employees to re-
ceive benefits under FERS, with some modifications. One
of those modifications is outlined in § 304(g), covering “Spe-
cial Rules for Former Spouses,” which provided that:
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OPM v. MOULTON 9
The entitlement of a former spouse to a portion of
an annuity of a retired officer or employee of the
Agency under this section shall extend to any sup-
plementary annuity payment that such officer or
employee is entitled to receive under section 8421
of title 5, United States Code.
FERS, Pub. L. No. 99-335, sec. 304(g), 100 Stat. at 627 (em-
phasis added); see also 50 U.S.C. § 2154(c)(2) (codifying a
similar rule). “[W]hen Congress includes particular lan-
guage in one section of a statute but omits it in another
section of the same Act, it is generally presumed that Con-
gress acts intentionally and purposely in the disparate in-
clusion or exclusion.” Barnhart v. Sigmon Coal Co., 534
U.S. 438, 452 (2002) (cleaned up). Congress chose to have
annuity supplements be included in the benefits payable to
a former spouse of a CIA employee by stating that such an
entitlement to a basic-annuity portion “shall extend to any
supplementary annuity payment,” but chose not to do so in
§ 8421(c), instead requiring the annuity supplement be
“treated in the same way” as the basic annuity. Accord-
ingly, under §§ 8421(c) and 8467(a), Congress intended to
have court orders resolve how the annuity supplement is
allocated.
Third, adopting OPM’s interpretation—that the annu-
ity supplement should be subject to the same allocation as
the basic annuity, even if the annuity supplement is not
expressly provided for in a court order—would result in
OPM effectively rewriting divorce decrees and departing
from the express will of the parties. For example, if a court
order allocates the basic annuity and annuity supplement
in different proportions—e.g., 50/50 for basic annuity and
20/80 for annuity supplement—under OPM’s interpreta-
tion, OPM would ignore the annuity-supplement allocation
and apply the 50/50 basic-annuity allocation to both bene-
fits. To take another example, if a court order allocates the
basic annuity 50/50 and states that the parties will not al-
locate the annuity supplement, under OPM’s
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OPM v. MOULTON 10
interpretation, it will honor the parties’ 50/50 allocation as
to the basic annuity but also require a 50/50 allocation of
the annuity supplement. “OPM is neither qualified nor ob-
ligated to resolve disputes about the import of state divorce
decrees[;] OPM’s task is purely ministerial with respect to
court ordered property settlements.” Hayward v. OPM,
578 F.3d 1337, 1345 (Fed. Cir. 2009) (cleaned up) (address-
ing survivor annuity under the Civil Service Retirement
System); see also 5 C.F.R. § 838.101(a)(2) (“In executing
court orders . . . OPM will not supply missing provisions,
interpret ambiguous language, or clarify the court’s intent
by researching individual State laws. In carrying out the
court’s instructions, OPM performs purely ministerial ac-
tions.” (emphasis added)); Oral Arg. at 6:47–7:07 (OPM’s
counsel describing OPM’s role as “ministerial”).
III
Central to OPM’s position is its argument that Mr.
Moulton’s and the Board’s interpretation would render
§ 8421(c) superfluous. See, e.g., Pet’r’s Br. 16–18; Reply
Br. 2, 7. Section 8467 applies to “[p]ayments under this
chapter,” here chapter 84, which includes both the basic
annuity and the annuity supplements. So, according to
OPM’s superfluity argument, under Mr. Moulton’s and the
Board’s interpretation, there is no need for § 8421(c), be-
cause § 8467 already applies to all FERS payments, includ-
ing annuity supplements. To address this purported
superfluity issue, OPM argues that § 8421(c) requires the
inclusion of annuity supplements in the calculations of the
basic annuity for purposes of a court-ordered apportion-
ment—even when, as is the case here, that apportionment
says nothing regarding annuity supplements.
There are several flaws with OPM’s superfluity argu-
ment. To start, OPM’s interpretation has its own superflu-
ity problems by rendering the “expressly provided for”
language in § 8467(a) superfluous. If annuity supplements
are always allocated in the same manner as the basic
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OPM v. MOULTON 11
annuity, as OPM argues, then § 8467(a)’s language that
“[p]ayments under [chapter 84]” will be apportioned only
when “expressly provided for” by a court order is superflu-
ous.
Further, the canon against surplusage is not absolute
and has limited force here because both parties’ interpre-
tations do not give effect to every word. See Microsoft Corp.
v. i4i Ltd. P’ship, 564 U.S. 91, 106 (2011) (“[T]he canon
against superfluity assists only where a competing inter-
pretation gives effect to every clause and word of a statute.”
(cleaned up)). And “[w]hile it is generally presumed that
statutes do not contain surplusage, instances of surplusage
are not unknown.” Arlington Cent. Sch. Dist. Bd. of Educ.
v. Murphy, 548 U.S. 291, 299 n.1 (2006); see also Rimini
St., Inc. v. Oracle USA, Inc., 586 U.S. 334, 346 (2019) (“Re-
dundancy is not a silver bullet.”). Congress is no stranger
to redundancies. See Barton v. Barr, 590 U.S. 222, 239
(2020) (“[R]edundancies are common in statutory draft-
ing—sometimes in a congressional effort to be doubly sure,
sometimes because of congressional inadvertence or lack of
foresight, or sometimes simply because of the shortcomings
of human communication.”). In any event, “[s]ometimes
the better overall reading of the statute contains some re-
dundancy,” Rimini St., 586 U.S. at 346, as is the case here.
Moreover, and as discussed above, redundancies can
also serve a clarifying purpose, which they appear to do
here. Section 8421(c) clarifies for OPM how the annuity
supplements should be treated for the purposes of
§ 8467(a)—i.e., annuity supplements should only be appor-
tioned if expressly provided for in a court order. OPM reads
§ 8421(c) as designed to depart from how § 8467 would oth-
erwise apply to annuity supplements. But there is no sug-
gestion in the statute that Congress sought to effect a
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OPM v. MOULTON 12
departure from the ordinary rule by enacting language that
expressly requires treatment in the same way.7
* * *
Accordingly, for the foregoing reasons, we interpret
5 U.S.C. §§ 8421(c) and 8467(a), together, to require OPM
to apportion a retiree’s annuity supplement only when ex-
pressly provided for in a court order.
CONCLUSION
We have considered OPM’s remaining arguments and
find them unpersuasive. For the foregoing reasons, we af-
firm.8
AFFIRMED
7 OPM’s reliance on Federal Law Enforcement Offic-
ers Association v. Ahuja, No. 19-cv-735, 2021 WL 4438907
(D.D.C. Sep. 28, 2021), is also unpersuasive. The district
court’s opinion is not binding on us, and the D.C. Circuit
vacated the district court’s decision because it determined
the district court lacked jurisdiction. Fed. L. Enf’t Officers
Ass’n v. Ahuja, 62 F.4th 551, 555 (D.C. Cir. 2023).
8 The previously imposed stay of the Board’s Novem-
ber 28, 2023 opinion and order, ECF No. 49, is lifted on the
same day the mandate issues.
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