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March 13, 2026 Get Citation Alerts Download PDF Add Note

John Peterson v. Douglas A. Collins

Court of Appeals for the Seventh Circuit

• Citations: None known
• Docket Number: 25-1004

• Judges: Kolar

• Opinion

• Authorities (8)

• Cited By (0)

• Summaries (0)

• Similar Cases (3.9K)

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Combined Opinion

                        by Kolar

In the

United States Court of Appeals
For the Seventh Circuit

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No. 25-1004
JOHN PETERSON,
Plaintiff-Appellant,
v.

DOUGLAS A. COLLINS, Secretary of Veterans Affairs, and
DEPARTMENT OF VETERANS AFFAIRS,
Defendants-Appellees.

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Appeal from the United States District Court for the
Central District of Illinois.
No. 2:21-cv-02293 — Colin S. Bruce, Judge.

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ARGUED SEPTEMBER 17, 2025 — DECIDED MARCH 13, 2026

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Before SCUDDER, PRYOR, and KOLAR, Circuit Judges.
KOLAR, Circuit Judge. Dr. John Peterson was employed as
a pain-management physician at the Veterans Administration
Illiana Health Care System (“VAIHCS”) in Danville, Illinois.
After concerns arose in 2020 regarding his standard of care,
he was placed on summary suspension and ultimately re-
moved from his position. He appealed the removal through
the Veterans Administration Disciplinary Appeals Board,
2 No. 25-1004

which denied his appeal. Peterson then filed this action in fed-
eral court, seeking judicial review of the Appeals Board’s final
decision and claiming he was subject to procedures that were
arbitrary and capricious and violated his Fifth Amendment
right to due process. Finding otherwise, the district court af-
firmed the Appeals Board’s ruling and dismissed the action.
On appeal, Peterson maintains that the Appeals Board fol-
lowed arbitrary procedures and that he was denied his due
process rights to contest his removal. But the record shows
otherwise: Peterson was given advance notice, multiple op-
portunities to be heard and submit evidence, and months to
prepare for his hearing before the Appeals Board. Because Pe-
terson provides no basis for concluding that these procedures
were inadequate, we affirm.
I. Background
Peterson began his employment as a pain-management
physician at VAIHCS in 2016. In early 2020, however,
VAIHCS placed Peterson on summary suspension due to con-
cerns that his practice “d[id] not meet the accepted standards
of practice and potentially constitute[d] an imminent threat to
patient welfare.” The suspension letter—dated January 17,
2020, and signed by the VAIHCS Director—informed Peter-
son that his suspension was effective immediately and that a
comprehensive review of his treatments was underway. The
letter advised Peterson of his right to provide information re-
garding the cited concerns within fourteen days, but he did
not do so. Though the letter stated that the comprehensive re-
view would be completed within thirty days, VAIHCS
granted itself multiple thirty-day extensions due to the
COVID-19 pandemic and to comply with its internal policies.
It ultimately completed the review on September 14, 2020.
No. 25-1004 3

The next day, the Acting Chief of Staff of VAIHCS, Dr. Gerson
Teran, prepared a memorandum balancing the aggravating
and mitigating factors of the allegations against Peterson,
which arose from his alleged mismanagement of patients’
opioid and benzodiazepine prescriptions. Teran’s memo ulti-
mately proposed that Peterson be removed from duty. On
September 17, the Clinical Executive Board at VAIHCS con-
vened and recommended to the VAIHCS Director that Peter-
son be removed.
Peterson received formal notice that the Clinical Executive
Board had recommended his removal and the permanent rev-
ocation of his clinical privileges on October 13, 2020. The
“Proposed Removal” described the charges against him: one
charge of “failure to provide appropriate medical care,” sup-
ported by twenty-one instances of conduct falling below the
standard of care, and one charge of “failure to follow instruc-
tion,” for an alleged incident in which Peterson interacted
with a patient while on suspension. It further advised Peter-
son of his rights to attorney representation, to review evi-
dence, and to reply to the charges within seven days. The ev-
idence on which the decision was based, or “evidence file,”
was attached to the Proposed Removal. The Proposed Re-
moval was signed by VAIHCS’s Specialty Service Chief.
Peterson’s attorney requested ninety days to review the
charges and prepare a response, but VAIHCS—required by
statute to issue a final decision within fifteen days of the Pro-
posed Removal—denied the request. Peterson filed no writ-
ten reply to the charges and, on November 4, received a Re-
moval Decision letter adopting the Proposed Removal.
Peterson appealed his removal to the Appeals Board, and
a hearing was scheduled for January 6, 2021. Peterson
4 No. 25-1004

immediately submitted a waiver of the Appeals Board’s stat-
utory deadline to render a decision, indicating he would need
more time to prepare, and the Appeals Board moved the hear-
ing to February 24. The Appeals Board also granted Peter-
son’s request to call an expert witness but denied his request
for discovery of VAIHCS internal documents. Peterson then
requested, and was granted, two further postponements of
the hearing date after claiming difficulty in finding an expert.
The Appeals Board’s grant of Peterson’s second request set
June 2 as the new hearing date and May 17 as the deadline to
name an expert but kept March 8 as the deadline for Peterson
to submit other motions and non-expert exhibits. Though the
record is unclear, Peterson appears to have identified his ex-
pert on May 17, and requested for the hearing to be pushed
back, for the third time, to June 30. But the Appeals Board de-
nied this request, noting the three prior extensions and con-
cluding “[t]here is time for the expert witness … to review the
evidence file prior to the hearing.”
For reasons that remain opaque, Peterson’s expert was un-
able to review the evidence file and prepare a report in time
for the June 2 hearing. In lieu of an expert report, Peterson
himself prepared a 154-page Rebuttal responding to each of
the Proposed Removal’s specifications. Peterson’s Rebuttal
was submitted to the Appeals Board at 7:30 PM on June 1—
the night before his hearing was scheduled to take place.
At the hearing, Peterson moved to enter the Rebuttal as an
exhibit, but the Appeals Board denied his request, noting an
objection from the agency—the Department of Veterans Af-
fairs was defending VAIHCS’s decision before the Appeals
Board—that the timing of Peterson’s submission gave it no
time to review the document prior to the hearing. Peterson
No. 25-1004 5

instead attempted to read from the Rebuttal during question-
ing by his attorney. The agency’s attorney objected again, and
the Appeals Board instructed Peterson that he could refer to
the evidence file and his notes (including the Rebuttal), but he
could not read directly from the document. Peterson then re-
fused to answer any further questions from his attorney.
Members of the Appeals Board, wanting more testimony
from Peterson, then questioned him directly, allowing him
thirty seconds per question to review the evidence file and the
Rebuttal before answering.
The Appeals Board issued its decision on July 15, sustain-
ing both charges against Peterson, with an accompanying re-
port detailing the Appeals Board’s findings sustaining ten out
of the twenty-one “failure to provide adequate care” allega-
tions, plus the one “failure to follow instruction” allegation.
The Appeals Board also sustained the penalty of removal and
revocation, noting briefly that “the sustained charges are se-
rious” and that it had reviewed VAIHCS’s discussion of ag-
gravating and mitigating factors.
The report also discussed the procedures used in reaching
its decision. It noted one procedural error—the Proposed Re-
moval was signed by the VAIHCS Chief of Specialty Service
rather than the Acting Chief of Staff, as required by the Veter-
ans Health Administration Handbook (“Handbook”). But it
concluded the error was harmless, as the Acting Chief of Staff
had been part of the Clinical Executive Board that voted on
Peterson’s removal. The report then explained the Appeals
Board’s decision to exclude the Rebuttal from evidence, not-
ing that by the time Peterson submitted it, the deadline to sub-
mit evidence had long passed and the agency lacked advance
opportunity to review the document. The report concluded
6 No. 25-1004

that “the [Appeals Board] gave [Peterson] ample opportunity
to prepare for the hearing and respond to the charges.” On
October 12, 2021, the Deputy to the VA Undersecretary for
Health approved the Appeals Board’s decision to remove Pe-
terson; this marked the agency’s final decision on Peterson’s
appeal.
Peterson then filed suit against the Secretary of Veterans
Affairs and the Department of Veterans Affairs. He argued
that the Appeals Board’s decision to exclude his Rebuttal, its
weighing of aggravating and mitigating factors, and various
procedures taken in tension with the Handbook were arbi-
trary and capricious and violated due process. Peterson then
moved “in support of complaint for judicial review,” effec-
tively a motion for summary judgment, and defendants cross-
moved for summary judgment in opposition.
The district court granted the defendants’ motion, affirm-
ing the Appeals Board’s decision. The court found (1) the Ap-
peals Board’s exclusion of the Rebuttal justified in light of the
document’s untimeliness and the opportunities Peterson had
been afforded to refer to it when providing testimony; (2) the
Appeals Board’s consideration of aggravating and mitigating
factors sufficient—if only “barely”—since the Appeals Board
had cited at least one aggravating factor (the seriousness of
charges) and noted the more thorough analyses performed by
VAIHCS prior to the Appeals Board’s review; (3) Peterson
failed to demonstrate that any harm resulted from the
agency’s diversions from the letter of the Handbook, finding
his arguments either undeveloped or unpersuasive; and (4)
the Appeals Board’s procedures gave Peterson adequate due
process, noting that he had been represented by counsel, per-
mitted to retain an expert, and afforded multiple extensions.
No. 25-1004 7

II. Discussion
A physician employed by the VA can challenge a major
adverse action, such as a suspension or discharge, under 38
U.S.C. § 7462. The statute allows employees to seek judicial
review and overturn a final agency action that is “arbitrary,
capricious, an abuse of discretion, or otherwise not in accord-
ance with law.” 38 U.S.C. § 7462 (f)(2)(A). “Arbitrary and ca-
pricious” is a deferential standard when reviewing agency ac-
tion; “[u]nder it, we will disturb an agency’s determination
only if it lacks a ‘rational basis.’” Dubnow v. McDonough, 30
F.4th 603, 610 (7th Cir. 2022) (quoting White Eagle Co-op. Ass’n
v. Conner, 553 F.3d 467, 474 (7th Cir. 2009)). On appeal, Peter-
son presents the same arguments for review under
§ 7462(f)(2)(A) that he pursued below. We review those chal-
lenges anew without deferring to the district court’s assess-
ment. Id. at 609.
A. Exclusion of the Rebuttal
The Appeals Board’s exclusion of Peterson’s Rebuttal was
neither arbitrary nor capricious. It is undisputed that the Ap-
peals Board communicated the deadlines for submitting ex-
hibits into the record and granted three extensions for Peter-
son to obtain an expert. But Peterson failed to meet these
deadlines, and instead—despite having over six months be-
tween his effective removal and his hearing before the Ap-
peals Board—submitted his own 154-page Rebuttal the even-
ing before the hearing. In both the hearing and its later report,
the Appeals Board explained that this timing gave the agency
no time to review the voluminous Rebuttal before the hearing,
preventing it from being included in the evidence file. This
reasoned application of the Appeals Board’s procedural rules
satisfies the obligation to provide a “rational basis” for its
8 No. 25-1004

decision. Id. at 610; see also Settling Devotional Claimants v. Cop-
yright Royalty, 797 F.3d 1106, 1122 (D.C. Cir. 2015) (holding
that administrative tribunal “reasonably declined to consider
… methodological evidence given its untimely presenta-
tion”).
Moreover, while the Appeals Board ruled that Peterson
could not circumvent its evidentiary ruling by simply reading
the Rebuttal into the record, it allowed him to consult the doc-
ument and any other notes (including the evidence file) when
answering questions. Peterson contends that this arrange-
ment “severely restricted” his ability to use the Rebuttal at the
hearing but makes no attempt to explain how or why.
Instead, Peterson cites to Doe v. Lieberman, another
physician-removal case in which a district court held that the
Appeals Board had acted arbitrarily and capriciously by
excluding “arguably relevant” evidence and “fail[ing] to give
any reason justifying the exclusion.” 2021 WL 4476748, at *8
(D.D.C. Sept. 30, 2021). But we do not find Doe persuasive
here. For one, unlike the plaintiff in Doe, Peterson has not
explained what made the Rebuttal even “arguably relevant”
to the proceedings, or even if it included evidence that was
not already contained in the file. But more importantly, unlike
in Doe, the Appeals Board did give Peterson a reasoned basis
for its exclusion. That is all that is required under the
arbitrary-and-capricious standard, whatever the decision’s
effect may be. See Dubnow, 30 F.4th at 610.
It is also worth noting that the Appeals Board is just that:
an appellate body. The Appeals Board hearing was neither Pe-
terson’s first chance to submit evidence, nor an unfettered op-
portunity to expand the evidentiary record. By applying an
No. 25-1004 9

even-handed and clearly communicated deadline, the Ap-
peals Board acted well within its bounds as an appellate body.
B. Aggravating and Mitigating Factors
We turn next to Peterson’s challenge to the Appeals
Board’s analysis of aggravating and mitigating factors sup-
porting the harsh penalty of removal and revocation. Peterson
argues that the Appeals Board’s decision was deficient be-
cause it failed to consider the twelve factors articulated in
Douglas v. Veterans Administration, 5 M.S.P.B. 313 (1981). Those
factors include “[t]he nature and seriousness of the offense …
[in] relation to the employee’s duties, position, and responsi-
bilities,” “the employee’s past disciplinary record,” “[the]
consistency of the penalty with those imposed upon other em-
ployees,” and “the adequacy and effectiveness of alternative
sanctions to deter such conduct,” among others. Douglas, 5
M.S.P.B. at 332.
We have yet to decide whether the Douglas factors are
binding on the Appeals Board. But even assuming they were,
a thorough accounting of the Douglas factors was conducted
in Peterson’s case. Prior to Peterson’s Proposed Removal,
Teran’s September 2020 memo walked through each of the
twelve Douglas factors in justifying the proposal that Peterson
be removed from employment. The Proposed Removal and
the Removal Decision also contained abridged discussions of
Douglas factors, focusing on the seriousness of the offense, Pe-
terson’s responsibilities as a seasoned provider in regular con-
tact with patients, and lack of rehabilitation potential.
As the district court observed, the Appeals Board’s formal
consideration of aggravating and mitigating factors was less
substantive. The Appeals Board’s report noted only the
10 No. 25-1004

seriousness of the offense in upholding the penalty of removal
and revocation and noted no potentially mitigating factors.
The Appeals Board did, however, refer to the discussions of
aggravating and mitigating factors in the Removal Decision,
Proposed Removal Order, and Teran’s memo. And under the
arbitrary-and-capricious standard, we are to “uphold a deci-
sion of less than ideal clarity if the agency’s path may reason-
ably be discerned.” Motor Vehicle Mfrs. Ass’n of the U.S., Inc. v.
State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983) (quotation
omitted). Here, the Appeals Board’s reference to the fulsome
analysis of the Douglas factors in the preceding documents
provides a discernible path the agency took to upholding the
penalty against Peterson. We thus conclude that the Appeals
Board’s analysis of aggravating and mitigating factors in re-
viewing Peterson’s penalty was sufficient.
C. Violations of the Handbook
Apart from his challenges to the Appeals Board’s proce-
dures and reasoning, Peterson also argues that VAIHCS acted
arbitrarily and capriciously by violating various provisions of
the Handbook in the course of his removal proceeding. These
purported violations include: (1) failing to complete a com-
prehensive review of his charges within thirty days of his sus-
pension, (2) failure of the Chief of Staff or Acting Chief of Staff
to sign his removal letter, and (3) not providing Peterson with
a complete copy of all evidence upon which the charges were
based. But Peterson has failed to either identify a genuine vi-
olation of the Handbook or develop a theory of how he was
harmed by these purported violations.
Starting with Peterson’s assertion of improper delay: sec-
tion 1100.19 of the Handbook does state that, following a sum-
mary suspension, “the comprehensive review… should be
No. 25-1004 11

accomplished within 30 calendar days.” But the Handbook
also provides an exception to this deadline “where the com-
prehensive review cannot be accomplished in 30 days,” re-
quiring only that “the circumstances should be documented
with an expectation of when the comprehensive review will
be completed.” Here, while VAIHCS did not complete its re-
view within the initial thirty-day timeframe, it sent letters to
Peterson each month explaining the reasons for the delay
(generally, due to COVID-19) and setting a new deadline
within thirty days. Peterson makes no argument that VAIHCS
was required to do more under section 1100.19.
Peterson’s other claims about violations of the Handbook
are undeveloped. He maintains that the Proposed Removal
was arbitrary and capricious because it was signed by the
Chief of Specialty Service, not the Chief or Acting Chief of
Staff as required by the Handbook. But as the Appeals Board
observed, the Acting Chief of Staff (Teran) was involved with
the removal process and officially voted to remove Peterson
from his position. Thus, whatever procedural error VAIHCS
committed in having the Chief of Specialty Service sign the
Proposed Removal was harmless. See Zero Zone, Inc. v. United
States Dep’t of Energy, 832 F.3d 654 (7th Cir. 2016) (“[W]e will
not invalidate an agency decision based on procedural error
unless the errors alleged could have affected the outcome.”
(quotation omitted)); Doran v. Wilkie, 768 F. App’x 340, 354
(6th Cir. 2019) (“[O]ur review of administrative agency deci-
sions is subject to harmless-error analysis[.]”).
Finally, Peterson briefly argues that he failed to receive a
complete copy of all the evidence against him, as required by
the Handbook. But the Proposed Removal included the evi-
dence file that VAIHCS relied upon in making the charges
12 No. 25-1004

against him, and even Peterson’s complaint states that he re-
ceived this evidence file—containing over 2,000 pages—in
November 2020. While Peterson faults VAIHCS for omitting
evidence covering “the entire term of [his] treatment of some
patients,” he does not identify any specific evidence that he
believes VAIHCS relied on but did not attach to the Proposed
Removal.
D. Due Process
Alternatively, Peterson argues that the combined effect of
the Appeals Board’s and VAIHCS’s procedural decisions de-
nied him due process in the revocation of his federal employ-
ment. A public employee facing termination has due process
rights to certain pre-deprivation procedures, including “no-
tice of the proposed deprivation, a statement of reasons, and
an opportunity to be heard in response.” Bradley v. Village of
University Park, 929 F.3d 875, 882 (7th Cir. 2019) (quoting Bd.
of Regents v. Roth, 408 U.S. 564, 569–70 (1972)). 1
Contrary to Peterson’s arguments, each of these require-
ments was met here. Peterson was given initial notice of the
concerns over his standard of care when he was placed on
summary suspension, notice of the Clinical Executive Board’s
decision to recommend his removal, and notice of the appeal-
able Removal Decision. When a decision was made following
the comprehensive review, the Proposed Removal gave Pe-
terson a statement of the reasons for the removal and gave

1 We observe that Peterson’s due process challenge goes to his re-
moval from federal employment; he does not raise a separate challenge to
the procedures he received (or lack thereof) prior to his near-ten-month
suspension leading up to the removal. That challenge would be subject to
the balancing test established in Gilbert v. Homar, 520 U.S. 924 (1997).
No. 25-1004 13

him an initial opportunity to be heard by filing a reply within
seven days. The Appeals Board gave Peterson even more pro-
cess, providing him with a hearing to present testimony, call
witnesses, and even granting multiple extensions for him to
produce an expert in his defense.
Peterson supplies no basis to conclude that these proce-
dures were insufficient to meet due process requirements.
While the exclusion of his lengthy Rebuttal and refusal to pro-
vide a fourth extension to prepare his expert may have made
his defense more difficult, Peterson was given months to pre-
pare for his Appeals Board hearing and numerous opportu-
nities to reply to the charges against him.
III. Conclusion
For the reasons stated above, the judgment of the district
court is AFFIRMED.