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Eves v. Lepage

United States Court of Appeals, First Circuit

June 19, 2019

MARK W. EVES, Plaintiff, Appellant,
v.
PAUL R. LEPAGE, Defendant, Appellee.

          APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MAINE HON. GEORGE Z. SINGAL, U.S. DISTRICT JUDGE.

          David G. Webbert, with whom Carol J. Garvan and Johnson, Webbert & Young, LLP were on brief, for appellant.

          Patrick Strawbridge, with whom Bryan K. Weir, Caroline A. Cook, and Consovoy McCarthy Park PLLC were on brief, for appellee.

          Before Howard, Chief Judge, Torruella, Stahl, Lynch, Thompson, Kayatta [*] , and Barron, Circuit Judges.

          OPINION EN BANC

          LYNCH, Circuit Judge.

         This court took this case en banc, which then caused the withdrawal of the panel opinion, Eves v. LePage, 842 F.3d 133 (1st Cir. 2016), while we reconsidered the case. A divided panel there had affirmed the district court's dismissal of this First Amendment retaliation suit brought by the then-Speaker of Maine's House of Representatives, Mark Eves, against the then-Governor of Maine, Paul LePage.[1] Eves alleged that, while governor, LePage leveraged discretionary state funding, in a yet unpassed state budget, to coerce an organization, Good Will-Hinckley ("GWH"), to terminate Eves's upcoming employment as its President.

         In his en banc petition, Eves has narrowed his legal claims by dropping all damages claims for the alleged violation of his free speech rights by LePage. Eves continues to pursue damages against LePage for his claim of political affiliation discrimination, which is now the only damages claim before us.

         The en banc court holds that LePage, on these unique facts, is entitled to qualified immunity because a reasonable governor in LePage's situation could have believed Eves's position as the new President of GWH to be a policymaking position for which political affiliation was relevant. We do not reach LePage's arguments that he is also entitled to immunity on other grounds. We also reinstate in part our prior panel opinion and affirm the dismissal of this action.

         I.

         Background

         The qualified immunity issues presented in this case are ultimately issues of law, which receive de novo review. Elder v. Holloway, 510 U.S. 510, 516 (1994). Like the district court, we assume the truth of the complaint's well-pleaded facts and draw all reasonable inferences in Eves's favor.[2] See Ashcroft v. Iqbal, 556 U.S. 662, 678-79 (2009); Feliciano-Hernández v. Pereira-Castillo, 663 F.3d 527, 532 (1st Cir. 2011) (quoting New York v. Amgen Inc., 652 F.3d 103, 109 (1st Cir. 2011)).

         A. Maine's Government and Budget Process

         We begin with background information on Maine law as of June 2015, the time of the events in this case, and other facts as found by the district court.

         Serving in the Maine Legislature is not a full-time job for most representatives. The legislature typically sits twice in each session: once from December to June in year one, then again from January to April in year two. See Me. Rev. Stat. Ann. ("M.R.S.A.") tit. 3, § 2. A legislator's salary was $24, 056, spread over the two years, plus a $38 per diem, when the legislature was active, "for housing or mileage and tolls." Eves v. LePage, No. 1:15-cv-300, 2016 WL 1948869, at *2 (D. Me. May 3, 2016). Most legislators have at least one other source of income, often in the private sector. Id. In fact, "[n]early all legislators depend on a career outside of the State House to provide for their families." Id. at *5 (relaying statement by Maine Senate President Mike Thibodeau).

         Maine's biennial budget process starts when the Department of Administrative and Financial Services "prepare[s] and submit[s] . . . a state budget document" to the governor, having considered submissions from various agencies and policy committees. M.R.S.A. tit. 5, § 1662. The governor then reviews the draft budget, alters it, and sends it to the legislature before the statutory deadline "in January of the first regular legislative session." Id. § 1666. The legislature must "enact a budget no later than 30 days prior to the date of adjournment prescribed" by law. Id. § 1666-A. The legislature's proposed budget then returns to the governor, who has line-item veto power, permitting him to reduce "any dollar amount" in the budget. Me. Const. art. IV, pt. 3, § 2-A. The legislature can override any such line-item vetoes with a simple majority of both the House and the Senate. Id. The governor can also veto the entire budget, like any other piece of legislation, in which case a two-thirds majority of both the House and Senate is necessary to override the veto. Id. art. IV, pt. 3, § 2.

         The events in this case, which occurred mostly in June 2015, arose in the midst of the biennial budget process and involved serious political conflict between Governor LePage and the legislature. The complaint sets forth reports from others about statements LePage made about Speaker Eves. Those statements, which are at the heart of this case, occurred on June 5, June 8, and June 9, before the legislature had passed any budget. The complaint also sets forth allegations about later statements by LePage on June 29, July 7, and July 30 as to his reasons for his actions.

         In a press conference on May 29, 2015, LePage stated that he planned to veto "every bill sponsored by a Democrat" for the rest of his term in office "unless the Legislature agreed to support his plan to have a referendum vote on eliminating Maine's income tax." Eves, 2016 WL 1948869, at *4. LePage did, in fact, veto ten bills on June 8, 2015, stating that he had done so purely because of their Democratic sponsorship.

         After the legislature passed a budget on June 17, 2015, LePage issued sixty-four line-item vetoes, each of which the legislature overrode on June 18 and 19, 2015. On June 29, 2015, LePage vetoed the entire budget. The legislature also overrode that veto on June 30, enacting the budget for fiscal years 2016 and 2017 into law. The enacted budget included discretionary funding for GWH, which was disbursed to GWH after Speaker Eves's contract with GWH was terminated.

         B. Good Will-Hinckley, The Center of Excellence for At-risk Students ("the Center"), and The Maine Academy of Natural Sciences ("MeANS")

         GWH is a nonprofit charitable organization, which serves a public purpose, located in Fairfield, Maine. The nonprofit aims to provide services to at-risk children throughout the state. Founded in 1889 as a "farm, school and home for needy boys," GWH now has a broader mission and a portfolio encompassing a "college step-up program," a "Learning Center for youth with emotional or behavioral challenges," a nutrition program, a library, and a museum. Id. at *2. The organization has long depended on both private donations and government grants.

         GWH was designated by the Maine Legislature in 2009 "to serve as the nonprofit charitable corporation with a public purpose to implement the Center of Excellence for At-risk Students," a statutorily-established public entity. Id. at *3; see 2009 Me. Legis. Serv. Ch. 296 (West) (codified at M.R.S.A. tit. 20-A, §§ 6951-54). The legislature gave the governor discretion to fund the Center. See M.R.S.A. tit. 20-A, § 15689-A.20. In order to implement the Center, GWH opened a charter school in 2012, called the Maine Academy of Natural Sciences ("MeANS"), which it continues to operate. Eves's counsel conceded at oral argument that the operation of MeANS is the only way in which the Center has been implemented.

         The complaint is silent as to whether MeANS is considered a "public" charter school and whether state funding intended for MeANS is simply passed on from GWH to MeANS as such. The complaint contains no allegations as to the exact legal relationship between the Center, MeANS, and GWH, and no allegations as to any contracts between them. Nor has Eves appended to the complaint any such contracts, nor quoted from them. However, three things are clear: (1) although MeANS has its own board and principal, the school relies on "discretionary state funding pursuant to its [statutory] designation as 'the Center for Excellence for At-risk Students, '" Eves, 2016 WL 1948869, at *3 (citing M.R.S.A. tit. 20-A, § 15689-A.20); (2) GWH fulfills its public function of implementing the Center only by administering MeANS, see 2009 Me. Legis. Serv. Ch. 296, § 2; and (3) the Center is, by legislative designation, a public entity, see id.

         The Maine state budget for fiscal years 2014 and 2015 -- which covered the period from July 1, 2013 to June 30, 2015 -- had allocated $1, 060, 000 in discretionary funding to GWH for the purpose of operating MeANS. Governor LePage disbursed all of the discretionary funding in that period; however, during that period, GWH was under a different President: first, Glenn Cummings, who was himself a former Speaker of the Maine House and a Democrat, and then under an interim President, Richard Abramson. The 2015- 2017 budget under debate in spring 2015 contained a discretionary appropriation of $1, 060, 000 to GWH to be paid in quarterly installments, as in previous years.

         C. Selection of Speaker Eves as President of GWH

         GWH began searching for a successor after Glenn Cummings resigned as President of GWH in September 2014. Eves, who was then Speaker of the Maine House, was one of the nineteen applicants.[3]

         GWH's eight-member search committee interviewed Eves on April 24, 2015. He visited the campus as one of three finalists, and on April 30, the GWH Senior Leadership Team unanimously recommended him as the best of the three. The Team's memo "cited his 'extensive clinical experience,' his 'balance of executive administration and fundraising experience,' and his 'leadership style and polished approach' as reasons" for their conclusion. Eves, 2016 WL 1948869, at *3. After Eves interviewed with the full boards of GWH and MeANS on May 15, GWH's Board voted unanimously to offer him the job of GWH President.

         On June 5, 2015, Eves, who was then still the Speaker of the Maine House, entered into a two-year employment agreement with GWH, beginning on July 1, 2015. Id. at *4. That agreement contained a "for-cause termination provision," and "no conditions or contingencies" related to any actions or funding decisions by the State. Id. Most of Eves's employment at GWH would overlap with his final term as Speaker. GWH announced Eves as its new President on June 9.

         D. Governor LePage's Intervention

         On June 5, Governor LePage learned that GWH had decided to hire Speaker Eves and promptly called GWH's interim President. Id. According to the complaint, LePage stated "that he was extremely upset" about the news and "used profanity to describe [Speaker Eves] and his work." That same day or "soon after," LePage also sent a handwritten note to GWH's Board Chair, which, as characterized in the complaint, "referred very negatively to Speaker Eves" and called him a "hack." This note was not appended to the complaint. The Board Chair's belief, after reading the note, was "that GWH would lose $1, 060, 000 in [discretionary] state funding if it retained Eves as its new President." Id.

         On June 8, Governor LePage "sent a public letter to the Board Chairs of GWH and MeANS, urging that they reconsider." Id. According to the complaint, the letter characterized Eves as "a longtime opponent of public charter schools" who had fought against "every effort to reform Maine's government." Id. This letter was also not appended to the complaint.

         The GWH Board, "which includes people of various political affiliations," discussed the letter and "agreed that their selection of Speaker Eves [had been] well-supported and . . . not based on political considerations." Id.

         On June 8, LePage also received a call from Gregory Powell, the Chairman of the Board of Trustees of the Harold Alfond Foundation ("the Foundation"), who was responding to a June 5 voicemail from LePage. The complaint alleges Powell was left with the impression that LePage was "withdrawing all support," including financial support, from GWH as long as Eves remained as President of the organization. The complaint alleges that Powell responded to the news by sending a letter to GWH's Board on June 18, warning them that the Foundation had "serious concern[s] . . . regarding [GWH's] future financial viability" if LePage were to follow through on his threat to withhold the $1, 060, 000 in discretionary state funding. Those concerns, Powell further warned, made the Foundation uneasy about committing to a $2, 750, 000 grant that the Foundation had been planning to give to GWH. Powell's letter was not appended to the complaint.

         On or about June 9, the complaint alleges Governor LePage told the Acting Commissioner of the Department of Education not to send any more payments to GWH "that [were] not required by law." The Commissioner, in response, froze $132, 500 in discretionary funding that was scheduled to be sent to GWH at the beginning of the next quarter (on July 1), assuming the enacted budget contained an appropriation of those funds. As of June 9, the legislature had not yet passed the budget or appropriated any funding for GWH. It would have been a violation of Maine law to have sent the $132, 500 to GWH before the budget was final and enacted. See M.R.S.A. tit. 5, § 1543.

         The lawyers for Eves and Governor LePage spoke on June 22. Eves's lawyer asked LePage to withdraw his threats, but LePage refused to change his stance. However, LePage took no further steps "to reduce or eliminate the $1, 060, 000 in discretionary funds allotted in the proposed state budget for GWH." Eves, 2016 WL 1948869, at *5.

         After that conversation between the attorneys, GWH terminated Speaker Eves's employment contract on June 24, one week before his planned July 1 start date. Eves was Speaker of the Maine House at the time. Eves immediately stated publicly that "his firing was caused by LePage's threat to withhold funding." Id. Months later, on October 15, GWH's Board Chair stated in a legislative hearing that Eves's employment would not have been terminated but for Governor LePage's intervention. Some of Eves's colleagues in the legislature also spoke out. State Senate President Mike Thibodeau, a Republican, publicly stated that he was "very saddened by this situation and shocked by what is being alleged. Nearly all legislators depend on a career outside of the State House to provide for their families." Id.

         Initially, Governor LePage declined to confirm or deny that he had made any statement to influence GWH's decision-making process. However, as the complaint alleges, when local reporters interviewed LePage on June 29 and asked whether he had "threatened to withhold money" from GWH, he responded:

Yeah, I did! If I could, I would! Absolutely; why wouldn't I? Tell me why I wouldn't take the taxpayer money, to prevent somebody to go into a school and destroy it. Because his heart's not into doing the right thing for Maine people.

         In a radio address on July 7, LePage further explained:

[Eves] worked his entire political career to oppose and threaten charter schools in Maine. He is the mouthpiece for the Maine Education Association. Giving taxpayers' money to a person who has fought so hard against charter schools would be unconscionable.

         And in another interview on July 30, LePage called Eves "a plant by the unions to destroy charter schools." LePage drew an analogy: "[O]ne time I stepped in . . . when a man was beating his wife. Should I have stepped in? Legally, no. But I did. And I'm not embarrassed about doing it."

         E. Procedural History of This Litigation

         Eves filed this lawsuit on July 30, 2015, and then filed a First Amended Complaint on December 18, 2015. Governor LePage moved to dismiss the suit on January 5, 2016, arguing in his supporting memo that the complaint failed to state any claim and that the subject matter of the lawsuit was "a political dispute that does not belong in court." He explicitly asserted, inter alia, that his actions as to Eves were protected by both absolute and qualified immunity. On April 13, 2016, Eves was granted leave (without opposition) to file a Second Amended Complaint.[4]

         On May 3, 2016, the district court issued an opinion granting Governor LePage's motion to dismiss. Eves, 2016 WL 1948869, at *1. The court entered judgment for LePage the next day, and Eves filed a notice of appeal that same day.

         On November 22, 2016, a divided panel of this court affirmed the district court's dismissal of Eves's equitable claims, and dismissed his § 1983 damages claims on the basis of qualified immunity. Eves, 842 F.3d at 144-45. It also directed the district court to dismiss Eves's state law claim without prejudice. Id. at 146. Eves petitioned for rehearing en banc, and his petition was granted on January 19, 2018.

         Eves has narrowed his claims for en banc review. The conduct by Governor LePage he is now challenging is limited to LePage's alleged threat to withhold discretionary funding, and the stop order that was placed, before the budget was finalized, on GWH's first quarterly payment for fiscal year 2015. Eves is no longer pursuing damages for his free speech claim, but continues to pursue damages for political affiliation discrimination. Eves is also still pursuing equitable relief, especially declaratory relief.

         II.

         We Hold that Qualified Immunity Bars Eves's Claim for Damages for Political Affiliation Discrimination

         A. Qualified Immunity Framework

         The Supreme Court has long established that, when sued in their official capacities, government officials are immune from damages claims unless "(1) they violated a federal statutory or constitutional right, and (2) the unlawfulness of their conduct was 'clearly established at the time.'" District of Columbia v. Wesby, 138 S.Ct. 577, 589 (2018) (quoting Reichle v. Howards, 566 U.S. 658, 664 (2012)). The second step of the qualified immunity inquiry, in turn, involves several factors.

         The plaintiff must demonstrate that "the law was '"sufficiently clear" [such] that every "reasonable official would understand that what he is doing" is unlawful.'" Id. at 589 (quoting Ashcroftv.al-Kidd, 563 U.S. 731, 741 (2011)). The Supreme Court has "repeatedly told courts" not to define the qualified immunity inquiry "at a high level of generality." City & Cty. of S.F.v.Sheehan, 135 S.Ct. 1765, 1775-76 (2015) (quoting al-Kidd, 563 U.S. at 742). Rather, clearly established law must define "the right allegedly violated . . . in a 'particularized' sense so that the 'contours' of the right are clear ...


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