United States District Court, N.D. Mississippi, Greenville Division
UNITED STATES OF AMERICA ex rel, KELLY NICOLE HORTON WUESTENHOEFER; and KELLY NICOLE HORTON WUESTENHOEFER, individually Plaintiff,
A.J. JEFFERSON, et al., Defendants.
ORDER GRANTING IN PART PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT
DEBRA M. BROWN, District Judge.
This False Claims Act and unlawful retaliation action is brought by Kelly Nicole Wuestenhoefer ("Relator") on behalf of herself and the United States. Doc. #29. Relator alleges that her former employer, Defendant South Delta Regional Housing Authority ("SDRHA"), its Board of Commissioners, and various other persons and entities, engaged in "wrongful, fraudulent and illegal conduct" with regard to funds of the United States Department of Housing and Urban Development. Id. at 12. Relator also alleges that as a result of her cooperation with the Federal Bureau of Investigation's investigation into the defendants' illegal conduct, she experienced retaliation in the terms and conditions of her employment. Id. at 29. Before the Court is Relator's motion for partial summary judgment. Doc. #257.
Summary Judgment Standard
"Summary judgment is appropriate when there are no genuine issues as to any material facts, and the moving party is entitled to judgment as a matter of law." Norwegian Bulk Transport A/S v. Int'l Marine Terminals P'ship, 520 F.3d 409, 411 (5th Cir. 2008) (citing Celotex Corp. v. Catrett, 477 U.S. 317 (1986)). To award summary judgment, "[a] court must be satisfied that no reasonable trier of fact could find for the nonmoving party or, in other words, that the evidence favoring the nonmoving party is insufficient to enable a reasonable jury to return a verdict in her favor." Id. at 411-12 (internal quotation marks omitted). To this end, "[t]he moving party bears the burden of establishing that there are no genuine issues of material fact." Id. at 412. "When considering a motion for summary judgment, the Court "resolve[s] factual controversies in favor of the nonmoving party." Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994).
On February 17, 2012, the United States of America filed an amended superseding indictment against Ann Jefferson and Jimmy Johnson. See U.S. v. Jefferson, No. 4:11-cr-111 (N.D. Miss. Feb. 17, 2012) (" Criminal Case "), at Doc. #47-1. Of relevance here, the indictment charged that Jefferson, in her role as Executive Director for SDRHA: (1) violated 18 U.S.C. § 641 by "willfully and knowingly" aiding and abetting Johnson in embezzling and converting approximately $10, 000 of United States property when she awarded Johnson a contract for construction that had already been completed and then caused SDRHA checks to be written to Johnson for payment on the contract ("Count One"); (2) violated 18 U.S.C. § 641 when she billed personal expenditures to an SDRHA account which she knew "included co-mingled federal funds" ("Count Four"); and (3) violated 18 U.S.C. § 1513(e) when she retaliated against Relator for Relator's assistance in the FBI investigation regarding Jefferson's conduct ("Count Seven").
Following a four-day trial, Jefferson was convicted on multiple counts of the superseding indictment, including Counts One, Four, and Seven. Criminal Case at Doc. #54. On May 1, 2014, the Fifth Circuit Court of Appeals affirmed Jefferson's convictions. U.S. v. Jefferson, 751 F.3d 314 (5th Cir. 2014). In upholding Jefferson's convictions under Counts One and Four, the Fifth Circuit held that:
the evidence presented against Jefferson at trial was overwhelming. Johnson, Jefferson's co-defendant, testified that they embezzled government funds by creating a fraudulent $10, 000 contract for work that had already been completed. [Angela] Brady corroborated Johnson's testimony - she helped Johnson cash a check written on the contract at a pawn shop and returned the funds to Jefferson. Testimony and exhibits at trial established that SDRHA repeatedly, at Jefferson's direction, paid for renovations at her Huddleston property, many of which were incorrectly invoiced to other properties. The receipts and requisition orders for a number of these renovations bore Jefferson's signature.
Id. at 321.
On September 12, 2014, citing Jefferson's convictions, Relator filed a motion for partial summary judgment in this action. Doc. #257.
In her motion, Relator seeks summary judgment "as to defendant Jefferson on the issues of liability as to both the false claims portion of the lawsuit... and the anti-retaliation claims.... [Relator] also seek[s] to impose judgment as a matter of law as to liability with respect to SDRHA on the anti-retaliation claims...." Doc. #257 at 1. As basis for this relief, Relator invokes "Collateral Estoppel and/or Issue Preclusion" arising from Jefferson's convictions in federal court. Doc. #263 at 6.
"In principle, the law of collateral estoppel is clear; in application, it can be a slippery concept indeed." U.S. v. Mock, 604 F.2d 341, 343-44 (5th Cir. 1979). In its most basic form, collateral estoppel bars "litigation of an issue previously decided in another proceeding by a court of competent jurisdiction...." Copeland v. Merrill Lynch & Co., Inc., 47 F.3d 1415, 1421-22 (5th Cir. 1995). Fifth Circuit courts "apply federal law to the question of the res judicata or collateral estoppel effect of prior federal court proceedings, regardless of the basis of federal jurisdiction in either the prior or the present action." Jackson v. FIE Corp., 302 F.3d 515, 529 n.58 (5th Cir. 2002).
Generally, federal courts apply collateral estoppel "when four conditions are met: (1) the issue under consideration is identical to that litigated in the prior action; (2) the issue was fully and vigorously litigated in the prior action; (3) the issue was necessary to support the judgment in the prior case; and (4) there is no special circumstance that would make it unfair to apply the doctrine." Copeland, 47 F.3d at 1421-22. In the Fifth Circuit, "the party seeking collateral estoppel effect has the burden of proving this to be so." Anderson, Clayton & Co. v. U.S., 562 F.2d 972, 992 (5th Cir. 1977) (citing United States v. Int'l Building Co., 345 U.S. 502, 506 (1953)); see also Kendall v. Visa U.S.A., Inc., 518 F.3d 1042, 1050-51 (9th Cir. 2008) ("The burden is on the party seeking to rely upon issue preclusion to prove each of the elements have been met.").
In deciding issues of collateral estoppel, the "[t]he right to a full and fair opportunity to litigate an issue is, of course, protected by the due process clause of the United States Constitution." Hardy v. Johns-Mansville Sales Corp., 681 F.2d 334, 338 (5th Cir. 1982). Accordingly, for collateral estoppel to apply, "a person against whom the conclusive effect of a judgment is invoked must be a party or a privy to the prior judgment." Id .; see also Stichting Ter Behartiging Van de Belangen Van Oudaandeelhouders In Het Kapitaal Van Saybolt Int'l B.V. v. Schreiber, 327 F.3d 173, 184-85 (2d Cir. 2003) (" Stichting "). As a general matter, "[p]rivity can be found if one party controlled the earlier lawsuit and its interests were represented by the party to the first suit." Drier v. Tarpon Oil Co., 522 F.2d 199, 200 (5th Cir. 1975) (internal quotation marks omitted); see also Stichting, 327 F.3d at 184-85 ("we have generally held that a determination in a ...