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Gulf Coast Research Laboratory v. Amaraneni

October 08, 1998


The opinion of the court was delivered by: Per Curiam







¶1. A majority of the court agrees that the judgment of the trial court must be reversed but fails to agree on the Disposition thereafter. Because we cannot agree on any instructions to guide the lower court, we remand the case to be decided on such principles as the trial Judge may deem right. See McNutt v. Lancaster, 17 Miss. 570 (1848).


¶2. This matter is before the Court on various state and federal claims, most notably a claim by the plaintiffs under 42 U.S.C. § 1983 that their civil rights were violated on account of their race and national origin. We conclude that the State is not a "person" under the federal statute pursuant to the United States Supreme Court's holding in Will v. Michigan Department of State Police, and should have been dismissed from this suit as to that claim. We also conclude that the plaintiffs' procedural due process rights were not violated. The plaintiffs presented a viable claim against the individuals under 42 U.S.C. § 1983. The chancellor, however, applied an erroneous standard under federal law in finding discriminatory intent on the part of the individual defendants and misapplied the law concerning damages. Thus, we reverse and remand for further proceedings. *fn1


¶3. The Board of Trustees of State Institutions of Higher Learning (IHL) has authority over the Gulf Coast Research Laboratory (GCRL) pursuant to Miss. Code Ann. § 37-101-21 (1996). Dr. G. J. Lakshmi was hired in 1970 and Dr. A. Venkataramiah (also referred to as Dr. Ramiah) was hired in 1969 as scientists at GCRL. They were hired to create the Physiology Section of GCRL and conduct research on shrimp. Both were hired by Dr. Gordon Gunter, Director of GCRL. They testified that they were led to believe that they would have continuing employment. Dr. Gunter indicated that he thought their employment was permanent, although there no written contract of employment. Drs. Ramiah and Lakshmi relied on Dr. Gunter's assurance as Director of GCRL in 1969 and 1970 when they were hired that their employment was continuous. In addition, Dr. Ramiah presented documentation from Dr. Howse indicating that Dr. Ramiah was a "permanent" employee of GCRL. Testimony was offered that indicated that Plaintiffs experienced a hostile work environment.

¶4. In 1985, Dr. Howse, the new GCRL Director, learned of budget problems that the State of Mississippi was experiencing that might result in reduced appropriations to GCRL. In May of 1986, after receiving a reduced financial appropriation from the state legislature as expected, Howse requested, and the Board of Trustees for IHL approved, a reduction in force plan. At the time the reduction in force was declared, GCRL had approximately 130 employees, 9 of whom were minorities. Ramiah and Lakshmi were the only minorities on the senior staff. Under the plan 34 people were terminated, 8 of whom were minorities and 26 non-minorities. On May 16, 1986, Drs. Ramiah and Lakshmi received letters from Dr. Howse terminating their employment with GCRL pursuant to the reduction in force plan. Shortly thereafter they submitted written objections to their terminations and requested that a hearing be provided to appeal their terminations. On June 30, 1986, the Workforce Reduction Appeal Panel submitted a final report finding that the plaintiffs' terminations were fair and reasonable.

¶5. Both Ramiah and Lakshmi were offered opportunities for reemployment with GCRL on November 21, 1986. These offers were to assume their previous jobs for a period through June 30, 1987. However, they refused the offers in a letter drafted by legal counsel representing both parties in this matter.

¶6. On May 18, 1987, Ramiah and Lakshmi filed a seven-count complaint in the Chancery Court of Jackson County, Mississippi. Count I charged that Defendants Howse and Cook in their individual capacities conspired to and did induce GCRL to unlawfully discharge the plaintiffs because of their race and national origin. Count II charged that the individual defendants unjustifiably interfered with their contracts of employment with GCRL because of the plaintiffs' race and national origin. Count III charged that the individual defendants interfered with the plaintiffs' prospective economic advantages because of their race and national origin and because the plaintiffs refused to compromise ethical and scientific standards. Count IV charged that GCRL unlawfully breached the plaintiffs' respective contracts of employment as a result of GCRL's policies and practices of discrimination based on race and national origin and because the plaintiffs refused to compromise ethical and scientific standards. Count V charged that the defendants, by their actions, tortiously violated the plaintiffs' constitutional rights by depriving them of due process, equal rights and privileges under the law, and freedom of speech because of the plaintiffs' race and national origin and because they refused to compromise ethical and scientific standards. Count VI charged the defendants with libel per se and per quod. Count VII charged the defendants with a violation of Miss. Code Ann. § 95-1-1, the "actionable words" or "anti-dueling" statute. Ramiah and Lakshmi sought injunctive and declaratory relief as well as compensatory and punitive damages.

¶7. On June 17, 1987, the Attorney General for the State of Mississippi filed a motion to dismiss the complaint. On March 22, 1988, the State's motion to dismiss was denied and the appellants/defendants filed an answer to the complaint on March 30, 1988. Thereafter, trial was commenced in the Chancery Court of Jackson County, Judge Kenneth B. Robertson presiding. The chancellor issued an Opinion of the Court on July 3, 1990, in which injunctive relief for reinstatement was denied. The lower court also issued a Supplemental Opinion Number 1 on October 11, 1990; a Corrected Supplemental Opinion on October 15, 1990; a Supplemental Opinion Number 2 on October 16, 1990; a Supplemental Opinion Number 3 on October 18, 1990; and a Supplemental Opinion Number 4 on October 20, 1990. In spite of the numerous claims listed in the complaint, the findings and Conclusions of the court focused almost exclusively on the plaintiffs' civil rights claim against GCRL and the individual defendants under 42 U.S.C. § 1983. A final judgment was entered in favor of the appellees on January 16, 1991, granting Dr. Ramiah $210,000 and Dr. Lakshmi $180,000 in damages. Also, the plaintiffs were granted $71,000 in legal fees, apparently by authority of 42 U.S.C. § 1988(b), which allows for attorneys' fees where a violation of § 1983 is proved. On February 14, 1991, Defendants filed an appeal to this Court.


¶8. Our standard of review in this appeal is well settled. This Court will not disturb a chancellor's findings "'unless the chancellor was manifestly wrong, clearly erroneous, or applied an erroneous legal standard.'" Merchants & Planters Bank of Raymond v. Williamson, 691 So. 2d 398, 402 (Miss. 1997) (quoting Tinnin v. First United Bank of Mississippi, 570 So. 2d 1193, 1194 (Miss. 1990)); United S. Bank v. Bank of Mantee, 680 So. 2d 220, 222 (Miss. 1996).


¶9. While multiple charges were listed in the complaint filed by Ramiah and Lakshmi, the findings and Conclusions of the court below focused on the liability of GCRL and the individual defendants under 42 U.S.C. § 1983. The appellants/defendants argue that the trial court erred in finding liability under the federal statute because several defenses are applicable to insulate GCRL, and Dr. Howse and Dr. Cook in their official capacities, from liability. They claim that these defendants do not come within the definition of "persons" as defined by 42 U.S.C. § 1983. Next, they claim that the decision which led to the termination of the appellees was an exercise of discretionary authority by a state employee which is protected under the doctrine of sovereign immunity. Finally, the appellants argue that Dr. Howse and Dr. Cook are entitled to qualified immunity because each was operating within the parameters of objective reasonableness and under the mandates of the Board of Trustees which has authority over GCRL. The appellants contend that the foregoing defenses preclude any finding of liability, and that the trial court was manifestly in error when it failed to dismiss the case.

1. The State as Defendant under 42 U.S.C. § 1983

¶10. The appellants' first contention is that the lower court should have dismissed GCRL, as well as Dr. Howse and Dr. Cook in their official capacities, at the outset of the litigation. They claim that states and state agencies are not "persons" for purposes of 42 U.S.C. § 1983. Section 1983 reads as follows: "Civil action for deprivation of rights. Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory or the District of Columbia, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress. For the purposes of this section, any Act of Congress applicable exclusively to the District of Columbia shall be considered to be a statute of the District of Columbia." 42 U.S.C. § 1983 (1994).

¶11. The Institutions of Higher Learning have consistently been held to be agents of the State. See Jagnandan v. Mississippi State Univ., 373 So. 2d 252, 253 (Miss. 1979), overruled on other grounds by Pruett v. City of Rosedale, 421 So. 2d 1046 (Miss. 1982); Bruner v. University of S. Mississippi, 501 So. 2d 1113, 1115 (Miss. 1987); Sorey v. Kellett, 849 F.2d 960 (5th Cir. 1988). Moreover, under Will v. Michigan Department of State Police, 491 U.S. 58 (1989), the United States Supreme Court ruled that states and state agencies are not within the class of potential defendants under § 1983: "[w]e hold that neither a State nor its officials acting in their official capacities are 'persons' under § 1983." Will, 491 U.S. at 71. Will was decided before final judgment was rendered in the court below, and a proper Motion to Dismiss for failure to state a claim had been filed by the Attorney General on June 17, 1987. Thus GCRL, as well as Dr. Howse and Dr. Cook in their official capacities, should have been dismissed as parties to the § 1983 claim.

¶12. Ramiah and Lakshmi incorrectly assert that Will was overruled by Hafer v. Melo, 502 U.S. 21 (1991). Will stands for the proposition that state officials acting in their official capacity are not statutory "persons" under § 1983. In Hafer, the Court took up the separate definitional issue of whether state officials, in their individual capacities, are such statutory "persons." The petitioner in Hafer sought a broad reading of the restriction imposed by Will, arguing that § 1983 does not authorize suits against state officers for damages arising from official acts. See Hafer, 502 U.S. at 23. However, the phrase, "acting in their official capacities" refers not to the capacity in which the officer inflicts the injury, but in the capacity in which the officer is sued. Id. at 26-27. To hold otherwise, the Court observed, would erase the distinction between official and personal capacity suits. Simply stated, individual defendants in § 1983 suits are not automatically shielded from personal liability under § 1983 "solely by virtue of the 'official' nature of their acts." Id. at 31.

¶13. Thus, Hafer does not disturb the holding in Will, which dictates that GCRL, and Dr. Howse and Cook in their official capacities, should have been dismissed in a suit for damages under § 1983. Hafer stands only for the proposition that Dr. Howse and Dr. Cook, in their individual capacities, are "persons" under § 1983, and could properly be sued under the federal statute. Since the mandate of Will is clear, GCRL's defense of sovereign immunity need not be addressed.

2. Qualified Immunity for Individual Defendants Howse and Cook

¶14. Dr. Howse and Dr. Cook claim they are entitled as individuals to the defense of qualified immunity, under both federal and state law standards. While it is a close question, we agree with the appellants on the threshold issue of whether Howse and Cook were performing discretionary duties when they implemented the reduction in force plan. "An official acts within his discretionary authority when he performs nonministerial acts within the boundaries of his official capacity." Tamez v. City of San Marcos, 118 F.3d 1085, 1091-92 (5th Cir. 1997). As head of GCRL, Howse decided whether to request the declaration of financial exigency. And while GCRL was required to get final approval from IHL for actions taken under the reduction in force plan, it was Howse and Cook who designed the criteria for implementing the plan. Their actions here were not pursuant to specific orders, or spelled out in minute detail beforehand. See id. Thus, some degree of deliberation or judgment characterized the actions of the defendants and as such these actions are discretionary.

¶15. Whether an official protected by qualified immunity may be held personally liable for an allegedly unlawful official action generally turns on the "objective legal reasonableness" of the action, assessed in light of the legal rules that were "clearly established" at the time it was taken. The Fifth Circuit has recently outlined this standard as it relates to the employment context: "To determine whether qualified immunity applies, a court must first determine whether the plaintiff has asserted a violation of a constitutional right. Siegert v. Gilley, 500 U.S. 226, 231, 111 S. Ct. 1789, 1793, 114 L.Ed.2d 277 (1991). This determination is made using currently applicable constitutional standards. Nerren v. Livingston Police Department, 86 F.3d at 473. If so, the court must then decide if the defendant's conduct was objectively reasonable, using the standards applicable at the time the events occurred. Id; Johnston v. City of Houston, 14 F.3d at 1059. If, upon viewing the evidence in the light most favorable to the non-movant, reasonable public officials could differ on the lawfulness of the defendant's actions, the defendant is entitled to qualified immunity. Anderson v. Creighton, 483 U.S. 635, 639, 107 S. Ct. 3034, 3038, 97 L.Ed.2d 523 (1987), citing Pfannstiel v. City of Marion, 918 F.2d 1178, 1183 (5th Cir. 1990)." Southard v. Texas Bd. of Criminal Justice, 114 F.3d 539, 550 (5th Cir. 1997). Stated in simple terms, officials performing discretionary functions are shielded from civil damages liability "as long as their actions could reasonably have been thought consistent with the rights they are alleged to have violated." Anderson, 483 U.S. at 638.

¶16. Qualified immunity will not protect officials who knowingly violate the law. See Malley v. Briggs, 475 U.S. 335 (1986). As we will discuss, this Court is remanding for more specific findings and Conclusions on the issue of whether Howse and Cook intentionally discriminated against Ramiah and Lakshmi. The issue of qualified immunity is dependent upon this determination, since it can fairly be said that intentional discrimination on the basis of race or ethnic heritage would constitute objectively unreasonable grounds on which to terminate the plaintiffs.

¶17. The issue of qualified immunity for the various state law claims against Howse and Cook as individuals is resolved similarly. Discretionary duties are those positively imposed by law but which are dependent upon an officer's judgment or discretion. See Bankston v. Pass Rd. Tire Ctr., Inc., 611 So. 2d 998, 1008-09 (Miss. 1992). Common law qualified immunity has traditionally sought to protect the discretion of public officials so that those officials would not be deterred by the threat of suit from making decisions and formulating policies that are in the public good. State of Mississippi ex rel. Brazeale v. Lewis, 498 So. 2d 321, 322 (Miss. 1986); T. M. v. Noblitt , 650 So. 2d 1340, 1343 (Miss. 1995). However, qualified immunity does not protect those who engage in egregious behavior: "Our law thus directs that a governmental official has no immunity to a civil action for damages if his breach of a legal duty causes injury and (1) that duty is ministerial in nature, or (2) that duty involves the use of discretion and the governmental actor greatly or substantially exceeds his authority and in the course thereof causes harm, or (3) the governmental actor commits an intentional tort." ...

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