Mangold v. Analytic Services, Inc.

PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
KAREN W. MANGOLD; SANFORD D.
MANGOLD, Colonel,
Plaintiffs-Appellees,
v.
ANALYTIC SERVICES, INCORPORATED
(The Anser Corporation); JOHN
FABIAN, Doctor, individually, and in
his capacity as officer and agent of
the Analytic Services, Incorporated
No. 94-1307
(The Anser Corporation); PAUL A.
ADLER, individually, and in his
capacity as officer and agent of the
Analytic Services, Incorporated
(The Anser Corporation),
Defendants-Appellants,
and
UNITED STATES OF AMERICA,
Defendant.
Appeal from the United States District Court
for the Eastern District of Virginia, at Alexandria.
Leonie M. Brinkema, District Judge.
(CA-93-1635-A)
Argued: January 31, 1995
Decided: March 12, 1996
Before NIEMEYER and MICHAEL, Circuit Judges, and
PHILLIPS, Senior Circuit Judge.
Reversed and remanded by published opinion. Judge Niemeyer wrote
the opinion of the court on immunity, in which Senior Judge Phillips
joined; Senior Judge Phillips wrote the opinion of the court on subject
matter jurisdiction, in which Judge Niemeyer joined; Judge Michael
wrote a dissenting opinion.
_________________________________________________________________
COUNSEL
ARGUED: Thomas R. Bagby, EPSTEIN, BECKER & GREEN,
P.C., Washington, D.C., for Appellants. Darrell Madison Allen,
DARRELL M. ALLEN, P.C., Fairfax, Virginia, for Appellees. ON
BRIEF: Bennett Boskey, VOLPE, BOSKEY & LYONS, Washing-
ton, D.C., for Appellants.
_________________________________________________________________
OPINION
NIEMEYER, Circuit Judge, delivered the opinion of the court in Parts
I, III, and IV (on the issue of absolute immunity), and PHILLIPS,
Senior Circuit Judge, delivered the opinion of the court on the issue
of subject matter jurisdiction.
NIEMEYER, Circuit Judge:
We must decide whether absolute immunity shields a government
contractor from liability arising from statements it made in response
to government investigators during an official investigation. In
response to Air Force queries relating to charges of misconduct by an
Air Force colonel in his dealings with a private government contrac-
tor, the contractor answered questions under oath and provided other
information. When the colonel sued the contractor under common law
for injury to the colonel's reputation and position, the contractor
asserted the defense of absolute immunity, which the district court
rejected. Because we conclude that the government contractor should
not be subjected to state law tort claims based on statements it made
in response to an official government investigation about its dealings
with the government, we reverse the district court's ruling denying
such immunity.
2
I
On the initiative of Lt. Col. James Rooney, a United States Air
Force officer assigned to the Air Force's Resource Allocation team at
the Pentagon, the Air Force Office of Special Investigations and the
Inspector General opened an inquiry into the practices of Col. Sanford
D. Mangold, who headed the team.1 The investigation was undertaken
to determine whether Col. Mangold abused his authority in his treat-
ment of subordinates and in his dealings with the private sector. One
aspect of the investigation focused specifically on allegations that
Col. Mangold improperly exerted his influence to pressure a govern-
ment contractor, Analytic Services, Inc. (which the parties refer to as
"ANSER"), to hire a Mangold family friend. ANSER is a private cor-
poration which contracts with the U.S. government to provide engi-
neering and analysis services in connection with government
acquisitions, particularly by the Air Force.
The investigation into Col. Mangold's activities was conducted by
Air Force Brig. Gen. Raymond Huot. General Huot and his staff
approached ANSER in June 1993 and inquired about Col. Mangold's
effort to have ANSER hire Mrs. Betsy Worrell, a close friend of Col.
Mangold's wife. Three ANSER officers responded to the investiga-
tors' questions and provided cassette tapes of telephone messages left
by Col. Mangold on ANSER's telephone answering machine in
November and December 1992.
In particular, Dr. John M. Fabian, ANSER's CEO, told Gen. Huot
that during the late fall of 1992, Col. Mangold, on behalf of the Air
Force, had requested use of ANSER's consulting services, which
were available to units of the government on an open contract. In con-
junction with his request, Col. Mangold suggested that ANSER hire
Mrs. Worrell to provide those services. Despite the fact that Mrs.
Worrell was not qualified to perform the job, Col. Mangold pressed
the matter, implying that his team's use of ANSER's services
depended on ANSER hiring Mrs. Worrell. Dr. Fabian stated that he
told Col. Mangold, "I value the name of this company and I'm not
interested in hiring somebody who was a friend of your wife's, in
_________________________________________________________________
1 At the time, the team was responsible for administering one quarter
of the Air Force's procurement, involving $20 billion.
3
order to provide contract support." Dr. Fabian explained to Col. Man-
gold that because Mrs. Worrell did not have a college degree, she did
not possess the preestablished qualifications necessary to provide the
services Col. Mangold requested. According to Dr. Fabian, Mangold
responded, "[I]f you can't do this I'll find a contractor who will."
ANSER's vice president, Paul A. Adler, confirmed Dr. Fabian's testi-
mony.
Transcripts of Col. Mangold's telephone messages left on
ANSER's telephone answering machine during the period corroborate
these witnesses' statements. These transcripts contain several mes-
sages in which Mangold repeatedly pressured ANSER to hire Mrs.
Worrell. He stated in various messages:
I'm real frustrated that you guys are not hiring Mrs. Worrell.
I think that ah, this was an excellent opportunity for ANSER
to get involved with XO [the team headed by Col. Man-
gold], to show some responsiveness, and work with us.
* * *
I would like to, uh, talk to you also about the fact that this
is really a test case for ANSER and XO working together
and if this one works out, we could probably see more
opportunities for ANSER . . . .
* * *
I've run out of maneuvering room on, uh, uh, using other
options in getting an individual like Mrs. Worrell on board
by the end of the, ah, ah, by the end of this week, first part
of next week when we expect the avalanche of budgetary
work to come in.
When it became clear that ANSER would not accede to his entreaties,
Col. Mangold canceled the Air Force's request for contract support
from ANSER. According to the answering machine transcripts, he
stated:
4
While the individual you sent to us and brought over is very
pleasant and, ah, and uh, intelligent young lady, we no lon-
ger need to have any ANSER support. . . . I want to make
it absolutely, indelibly, and totally clear that any ANSER
support for the Space CQ Dive team will not be provided
through this office. . . . I appreciate John your help and all
your ability to, in bringing an individual in the office, but I
do not need nor do I contemplate ever needing any ANSER
support for this Space CQ Dive Team.
Col. Mangold's immediate subordinate, Lt. Col. James Rooney,
who was familiar with Col. Mangold's efforts on behalf of Mrs. Wor-
rell, was concerned about the impropriety of Col. Mangold's actions
and consulted with another subordinate of Col. Mangold, Capt.
Anthony J. Russo, about his concern. As Capt. Russo related the
events:
Lt. Col. Rooney took me aside and also expressed serious
concerns about the comments made to ANSER. He stated
that he had already complained to Lt. Col. Mushaw and Col.
Kingsbery (both from XOFS) and that he was going to meet
with M Gen Hard (SAF/AQS) whom he knew well from a
previous assignment. Lt. Col. Rooney stated that Col. Man-
gold was about to go too far and that he did not want to be
involved in anything that might be illegal. He asked for my
support. I agreed that Col. Mangold had made comments
that could be misinterpreted by ANSER and promised that
I would tell the truth about the meeting at ANSER, if asked.
However, I told him that I would not personally go outside
of our chain of command, and that I wanted to more force-
fully express my objections directly to Col. Mangold before
I would think of going over his head.
Following Lt. Col. Rooney's complaints to superior officers, the Air
Force commenced an internal Air Force investigation, and Col. Man-
gold was transferred from his position as head of the Resource Allo-
cation team.
Several months later, Col. Mangold and his wife, Karen, filed suit
in a Virginia state court against ANSER, its executives, and Lt. Col.
5
Rooney for injuring their reputations and Col. Mangold's position
with the United States Air Force and for intentional infliction of emo-
tional distress. The seven-count complaint alleges both that the defen-
dants defamed Col. and Mrs. Mangold by fabricating the charges of
misconduct and that the defendants conspired to damage Col. Man-
gold's reputation and position. The Mangolds demand $15 million in
compensatory damages and $5 million in punitive damages.
Lt. Col. Rooney removed the case to the United States District
Court for the Eastern District of Virginia under 28 U.S.C.
§ 2679(d)(2), and the United States substituted itself for Lt. Col.
Rooney as the party defendant under the Federal Tort Claims Act, 28
U.S.C. § 2679(d)(1). After the United States filed a motion for sum-
mary judgment for lack of jurisdiction,2 the Mangolds voluntarily dis-
missed the United States as a party defendant.
ANSER and its employees also filed a motion for summary judg-
ment, asserting, among other defenses, immunity for claims arising
out of their responses to questioning and requests for information in
the course of an official Air Force investigation into ANSER's con-
tractual arrangement with the Air Force. The district court determined
that it had discretion to retain jurisdiction over the case, even though
the United States was no longer a party, to decide ANSER's immu-
nity defense. After denying ANSER's immunity defense, the court
remanded the case to the state court, purportedly under 28 U.S.C.
§ 1447(c).
This appeal was taken from the district court's ruling denying abso-
lute immunity. See Nixon v. Fitzgerald, 457 U.S. 731 (1982) (denial
of claim of absolute immunity is immediately appealable under collat-
eral order doctrine).
_________________________________________________________________
2 The United States contended that Col. and Mrs. Mangold failed to
exhaust their administrative remedies by filing an administrative claim
with the Air Force; that the United States had not waived its immunity
from the torts alleged in the complaint; and that the Mangolds' claims
were barred by the decision in Feres v. United States, 340 U.S. 135
(1950) (holding that the United States was not liable for servicemen's
injuries arising out of activity incident to military service).
6
II
As a threshold matter, we must address the suggestion that we lack
subject matter jurisdiction to hear this appeal because the district
court's ruling on absolute immunity was included in an order for
remand, and certain remand orders are not reviewable. See 28 U.S.C.
§ 1447(d); Thermtron Products, Inc. v. Hermansdorfer, 423 U.S. 336
(1976) (limiting application of § 1447(d) to remand orders issued
under § 1447(c)).
The appeal in this case challenges only the district court's ruling
on absolute immunity, not its subsequent remand to state court. The
fact that the two dispositions--denial of immunity and remand to
state court--were included in a single order does not deprive us of
jurisdiction to review the immunity ruling. See Waco v. U.S. Fidelity
& G. Co., 293 U.S. 140 (1934). In Waco, the Court held that it had
jurisdiction to review an order dismissing a party, even though the
dismissal was included in a nonreviewable order remanding the case
to state court. See also Jamison v. Wiley, 14 F.3d 222, 233 (4th Cir.
1994) (permitting review of a party-substitution order despite its
inclusion in same paper with order of remand).
Accordingly, I conclude that we have jurisdiction to review the dis-
trict court's interlocutory order denying the appellants absolute
immunity.3 See Nixon, 457 U.S. at 743. Alternatively, I concur in
Judge Phillips' concurring opinion directed to the jurisdictional issue.
III
Much of the law of governmental immunity has been developed as
part of the federal common law to protect a sphere of discretionary
governmental action from the potentially debilitating distraction of
defending private lawsuits. See, e.g. , Barr v. Matteo, 360 U.S. 564,
569-73 (1959) (plurality opinion); Westfall v. Erwin, 484 U.S. 292,
295 (1988). In Barr and Westfall, the Court recognized an absolute
_________________________________________________________________
3 Even if it were necessary to review the remand order, the provisions
of 28 U.S.C. § 1447(d), as limited by Thermtron, do not immunize it
from review. See Phillips, J., op. infra . In any event, we have jurisdiction
to reach the immunity issue.
7
immunity from state law tort liability for federal officials exercising
discretion while acting within the scope of their employment. Protect-
ing government actors with absolute immunity, however, has its costs,
since illegal and even offensive conduct may go unredressed. Such
immunity also tends to undermine the basic tenet of our legal system
that individuals be held accountable for their wrongful conduct. See
Westfall, 484 U.S. at 295. For these reasons, the common law immu-
nity recognized in Barr and Westfall is afforded only to the extent that
the public benefits obtained by granting immunity outweigh its costs.
Id. at 296 n.3.4
The absolute immunity recognized in Barr and Westfall is suffi-
ciently broad to protect, as part of the sphere of discretionary govern-
mental action, official decisions to investigate suspected fraud, waste,
and mismanagement in the administration of government contracts.
Official investigations of that type are critical to the efficient conduct
of government and their value outweighs the interest of affording
individuals redress against persons participating in the investigations
for wrongful action. And because such investigations can be effective
only if investigators are able to obtain the cooperation of witnesses,
cooperating government employees should also be protected through
immunity. If government employees cooperating in such investiga-
tions are left exposed to lawsuits filed by those under investigation,
they might be reluctant to cooperate, even if they were eyewitnesses
to improper conduct. Equally as important, in the absence of such
protection, they might distort information in an effort to avoid expo-
sure to tort liability.
_________________________________________________________________
4 In Westfall, the Court specifically invited Congress to establish legis-
lative standards to define the contours of the official immunity available
to federal employees involved in state law tort actions. 484 U.S. at 300.
Congress responded with the Federal Employees Liability Reform and
Tort Compensation Act, codified at 28 U.S.C. § 2679 and commonly
referred to as the Westfall Act. The Act substitutes the United States as
the sole defendant in any state law tort action against a federal employee
for acts committed within the scope of the employee's office or employ-
ment, regardless of whether the employee's discretion was involved. At
federal common law, absolute official immunity remains limited to dis-
cretionary functions.
8
Whether Barr and Westfall immunity also extends to persons in the
private sector who are government contractors participating in official
investigations of government contracts is less clear. Even though pri-
vate persons under contract with the government act only partly in the
public sphere, the public interest may demand that immunity protect
them to the same extent that it protects government employees. The
public interest in facilitating the government's policing of its contract-
ing process--a process subject to the temptation of conflicting self
interest and to the risks of undue influence and corruption--is perhaps
as important as the public interest in facilitating the government's
policing of itself. And to expose private government contractors who
are responding to and cooperating with such investigations to the risk
of state tort claims would chill the investigative effort to the same
extent that exposing cooperating government employees would. Ulti-
mately, to allow such tort liability, whether against government
employees or private contractors, would tend to make government
less efficient.
Extending such immunity to the private sector, in the narrow cir-
cumstances where the public interest in efficient government out-
weighs the costs of granting such immunity, comports with the
principles underlying the immunity recognized in Barr and Westfall,
since the scope of that immunity is defined by the nature of the
function being performed and not by the office or the position of the
particular employee involved. As the Court in Barr explained:
The privilege is not a badge or emolument of exalted office,
but an expression of a policy designed to aid in the effective
functioning of government. The complexities and magnitude
of governmental activity have become so great that there
must of necessity be a delegation and redelegation of
authority as to many functions, and we cannot say that these
functions become less important simply because they are
exercised by officers of lower rank in the executive hierar-
chy.
360 U.S. at 572-73. If absolute immunity protects a particular govern-
mental function, no matter how many times or to what level that func-
tion is delegated, it is a small step to protect that function when
delegated to private contractors, particularly in light of the govern-
9
ment's unquestioned need to delegate governmental functions. The
government cannot perform all necessary and proper services itself
and must therefore contract out some services for performance by the
private sector. When the government delegates discretionary govern-
mental functions through contracting with private contractors, there-
fore, the same public interest identified in Barr and Westfall--the
interest in efficient government--demands that the government pos-
sess the ability meaningfully to investigate these contracts to ensure
that they are performed without fraud, waste, or mismanagement.
Extending immunity to private contractors to protect an important
government interest is not novel. See, e.g., Boyle v. United Technolo-
gies Corp., 487 U.S. 500 (1988). In holding that a government con-
tractor providing helicopters for the military was not liable under state
tort law for injury caused by a design defect, the Court in Boyle
equated the liability of a private procurement contractor with that of
a government official who might have beencalled upon to design and
manufacture the same product:
The present case involves an independent contractor per-
forming its obligation under a procurement contract, rather
than an official performing his duty as a federal employee,
but there is obviously implicated the same interest in getting
the Government's work done.
Id. at 505 (emphasis added). After observing that designing a helicop-
ter for military performance is "assuredly a discretionary function,"
id. at 511, and that a government official performing the same func-
tion would therefore be protected by immunity under 28 U.S.C.
§ 2680(a) (Federal Tort Claims Act), the Court concluded:
It makes little sense to insulate the Government against
financial liability for the judgment that a particular feature
of military equipment is necessary when the Government
produces the equipment itself, but not when it contracts for
the production. In sum, we are of the view that state law
which holds Government contractors liable for design
defects in military equipment does in some circumstances
present a "significant conflict" with federal policy and must
be displaced.
10
487 U.S. at 512 (footnote omitted). See also Yearsley v. Ross Constr.
Co., 309 U.S. 18, 20-21 (1940).
We believe that the rationale for the protections articulated in Barr,
Westfall, and Boyle also applies to the case before us to the extent that
this case involves a discretionary governmental function which has
been delegated to the private sector. This conclusion, however, does
not fully resolve the issue of whether persons cooperating with an
official government investigation, as distinguished from persons
conducting the investigation, are protected. While the decision to con-
duct an investigation may be a discretionary act involving an exercise
of judgment, see Westfall, 484 U.S. at 300, and as such may be pro-
tected by absolute immunity, the reasoning in Westfall provides only
a partial foundation for protecting witnesses cooperating in an official
investigation. The full justification for such immunity also draws on
principles of that immunity which protects witnesses in government-
sponsored investigations and adjudications.
The law provides immunity of varying degrees to both private citi-
zens and public officials engaged in investigating and adjudicating
disputes in order to ensure a meaningful government-sponsored judi-
cial system. Thus, an absolute immunity shields witnesses testifying
in court, see Briscoe v. LaHue, 460 U.S. 325, 335-36 (1983), and tes-
tifying before a grand jury. See Anthony v. Baker, 955 F.2d 1395,
1400 (10th Cir. 1992); Kincaid v. Eberle, 712 F.2d 1023 (7th Cir.),
cert. denied, 464 U.S. 1018 (1983). And immunity also has been held
to extend to witnesses giving testimony to public prosecutors, see
Holmes v. Eddy, 341 F.2d 477, 480 (4th Cir.), cert. denied, 382 U.S.
892 (1965). The underlying policy for the grant of such immunity is
long-standing:
In the words of one 19th-century court, in damages suits
against witnesses, "the claims of the individual must yield
to the dictates of public policy, which requires that the paths
which lead to the ascertainment of truth should be left as
free and unobstructed as possible." Calkins v. Sumner, 13
Wis. 193, 197 (1860). A witness's apprehension of subse-
quent damages liability might induce two forms of self-
censorship. First, witnesses might be reluctant to come for-
ward to testify. . . . And once a witness is on the stand, his
11
testimony might be distorted by the fear of subsequent lia-
bility.
Briscoe, 460 U.S. at 332-33 (citation omitted). In the absence of a
privilege for such witnesses, the exposure to tort lawsuits would chill
government-sponsored investigatory and adjudicatory efforts, threat-
ening to undermine their reliability and therefore to erode confidence
in the judicial function of government. Those negative consequences
would far outweigh the benefit of giving individuals a right of redress
for false testimony.
Accordingly, in the circumstances of this case, we recognize an
absolute immunity that has two roots, one drawing on the public inter-
est in identifying and addressing fraud, waste, and mismanagement in
government, and the other drawing on the common law privilege to
testify with absolute immunity in courts of law, before grand juries,
and before government investigators. While this immunity has foun-
dations well established in the common law, we take care to apply it
to witnesses in the private sector only to the extent necessary to serve
the greater public interest. Therefore we apply such immunity only
insofar as necessary to shield statements and information, whether
truthful or not, given by a government contractor and its employees
in response to queries by government investigators engaged in an
official investigation. See also Becker v. Philco Corp., 372 F.2d 771,
774 (4th Cir.) (holding a defense contractor immune from liability for
an alleged defamatory report detailing possible security breaches by
two employees), cert. denied, 389 U.S. 979 (1967); Holmes, 341 F.2d
at 480-81 (granting stockbroker immunity for statements made to the
SEC about a suspicion that a company was attempting to "bilk the
public via the securities market"); Gulati v. Zuckerman, 723 F. Supp.
353, 358 (E.D. Pa. 1989) (granting absolute immunity to a defense
contractor and its employees for allegedly defamatory statements
about the company's former president in his dealings with the Depart-
ment of Defense). Cf. Bradley v. Computer Sciences Corp., 643 F.2d
1029, 1033 (4th Cir.) (granting qualified immunity to defense con-
tractor from libel suit for criticism of civil service employee based on
constitutional right to criticize government), cert. denied, 454 U.S.
940 (1981).
Turning to the facts in this case, an official Air Force investigation
was undertaken by Brig. Gen. Huot and the Office of Special Investi-
12
gations to determine whether Col. Mangold had been involved in any
wrongdoing in his dealings with ANSER. Investigations conducted by
the Air Force Office of Special Investigations are official actions
designed to combat fraud, waste, abuse, and mismanagement in gov-
ernment, and the scope of Gen. Huot's investigation was limited, in
his words, to inquiring into "the involvement of Sandy Mangold with
ANSER Corp. . . . in trying to get a budget analyst hired and allega-
tions which surrounded trying to get one Mrs. Betsy Worrell hired
with ANSER in that process." ANSER did not initiate the investiga-
tion, but merely responded to the official Air Force inquiries. And
nothing in the record suggests that ANSER and its employees volun-
teered any information beyond the scope of the Air Force's inquiries.
Cf. Gulati, 723 F. Supp. at 358 (refusing to extend immunity to a let-
ter written by contractor to the Small Business Administration which
was not connected with a governmental investigation and not made
in response to a government request). It was solely on the substance
of the responses given by ANSER and two of its officers to these
inquiries that Mangolds' tort claims against ANSER and its officers
were based.
Because ANSER and its employees provided information only as
requested by the government agency officially investigating Col.
Mangold's dealings with ANSER, we hold that ANSER and its
employees are absolutely immune from state tort liability based on
any statements made and information given in response to queries
made in the course of the Air Force's investigation. Accordingly, the
ruling of the district court that such immunity does not attach is
reversed.
PHILLIPS, Senior Circuit Judge, specially concurring, delivered the
opinion of the court on the issue of subject matter jurisdiction:
I concur in Judge Niemeyer's opinion holding that we have juris-
diction to review the district court's no-immunity ruling and, on the
merits, that the district court erred in that ruling. I write specially
because I believe that under the unusual procedural circumstances, a
proper disposition of the appeal requires that we review the remand
order as well as the immunity ruling; that for that purpose we may
inquire, sua sponte, into our jurisdiction to do so; that upon such an
13
inquiry, we do have jurisdiction for that purpose; and that upon that
review error is apparent, requiring vacatur of the remand order.
I
The ANSER defendants' notice of appeal "designates" as the
"judgment, order, or part thereof appealed from" "the Memorandum
Opinion and Order dated and entered in this action on the 1st day of
February, 1994." JA 327. That Order both denied the absolute immu-
nity defense and remanded the action to the state court. JA 325.
Although none of the parties has challenged our jurisdiction to
review either of these rulings, we must of course in this as any case
satisfy ourselves, sua sponte, of our jurisdiction to resolve any merits
issues properly presented for review. Here, the only merits issue for-
mally presented for review is the propriety of the district court's
immunity ruling. Appellant's Br. i. But, for reasons that follow, in
order to address sua sponte our jurisdiction to review that substantive
ruling, we must also address our jurisdiction to review the remand
order, for the former may turn significantly on the latter.
A.
The principal problem with our jurisdiction to review the remand
order is of course, 28 U.S.C. § 1447(d) which generally bars review,
by any means, of orders remanding removed cases. Although
Thermtron, 423 U.S. 336 (1976), established that only remands
invoking one of the grounds specified in § 1447(c)--defect in
removal procedure or lack of subject matter jurisdiction--come under
§ 1447(d)'s bar, the remand order here arguably does invoke lack of
subject matter jurisdiction, hence does come under the bar. Indeed, at
one point in the order the district court opined that "there is no longer
any basis for federal jurisdiction", and the remand order concludes
that it is entered "pursuant to 28 U.S.C. § 1447." If this was the actual
ground invoked, we may not review this order even if it be mani-
festly, inarguably erroneous. See Gravitt, 430 U.S. 723 (1977).
But, powerful policy considerations and persuasive decisional
authority support our power--and responsibility--to look past con-
14
textually ambiguous allusions and even specific citations to § 1447(c)
to determine by independent review of the record the actual grounds
or basis upon which the district court considered it was empowered
to remand. First, it must be the case, as some courts have had the
occasion to recognize, that neither the citation of§ 1447(c) nor the
failure to cite it as presumed authority for a remand is conclusive of
the real question: whether one of its two grounds is the actual basis
being invoked as authority for remand. See Kolibash, 872 F.2d 571,
573 (4th Cir. 1989) (failure to cite not conclusive;§ 1447(c) basis
found in record review); Kunzi, 833 F.2d 1291, 1293-94 (9th Cir.
1987) (§ 1447(c) cited, but further inquiry made to determine actual
basis). If a review of the record discloses to a reviewing court's satis-
faction that, notwithstanding any indications to the contrary, the
actual basis upon which the court thought it was empowered to
remand was neither of these, § 1447(d) does not bar review. In the
instant case, the only question is whether the basis actually invoked
was lack of jurisdiction.
B.
My reading of the record here satisfies me that, despite evident
confusion and some backing and filling during the process, the district
court remanded in the end not on the assumption that there was a
"lack of jurisdiction" so that remand was compelled, but that though
there was jurisdiction, there was discretion to remand. It is settled that
when a district court remands on such a basis, § 1447(d) does not bar
appellate review. See, e.g., In re Surinam Airways Holding Co., 974
F.2d 1255, 1257 (11th Cir. 1992); see also Carnegie Mellon v. Cohill,
484 U.S. 343 (1988) (court of appeals' review of discretionary
remand of pendant state law claim affirmed by Supreme Court).
My analysis of the record on this point is as follows: The remand
order was actually entered not in response to a motion to remand, but
in consequence of a hearing on a motion by the United States to dis-
miss or for summary judgment on the merits and a motion of the
ANSER defendants for summary judgment on the merits based upon
their immunity defense. At the outset of the hearing it was revealed
that the plaintiff had, in response to the United States' motion, volun-
tarily dismissed the United States. At that point the court's first sug-
gestion of jurisdictional issues occurred. Having determined on
15
inquiry that there was not diversity between the remaining parties, the
court inquired: "Then there is no longer any basis for federal jurisdic-
tion to this, is there?" J.A. 307. Asking to be heard on that matter,
counsel for the ANSER defendants noted that those defendants had
raised a federal-immunity defense and suggested that in the situation
thus presented, it was "appropriate" for the court to "retain[ ] jurisdic-
tion based upon the assertion by the private defendants of a Federal-
immunity defense." J.A. 308. Citing decisional authority, counsel
argued that the existence of such a federal defense"provides the
Court with federal jurisdiction." Id. And in a critical additional point,
counsel (incorrectly) asserted, "Of course, in any event, . . . the Court
under United Mine Workers v. Gibbs may retain jurisdiction over
claims even if a Federal claim no longer exists in the case." Id. To
which the court, also critically for our purposes, responded: "But it's
purely discretionary with the Court whether to hold on to the case in
the posture that it presently is in. [?]." Id. (emphasis added). To which
ANSER counsel responded, with no demur by counsel for plaintiff:
"That's correct, Your Honor. I would urge the Court to go ahead and
decide the summary judgment motion . . . based upon the defendant's
assertion of a Federal-immunity defense . . . ." J.A. 308-09. Counsel
for ANSER then argued the merits of the federal defense in an
extended colloquy with the court during with the court gave no indi-
cation that, at odds with counsel's suggestion, it actually lacked sub-
ject matter jurisdiction over the claim against the ANSER defendants.
J.A. 309-13.
When, following this colloquy, plaintiffs' counsel was asked to
respond, counsel first noted that "to the extent the Court does not feel
it has jurisdiction over this claim, we would . . . welcome a remand
to [the state] Court." J.A. 313. Counsel then turned to an argument on
the merits of the immunity defense with the court engaging in sub-
stantive colloquy without suggesting any reservation about its juris-
diction to do so. J.A. 313-19. At the conclusion of counsels' opposing
arguments on the merits, the district court made critical statements
relevant to its understanding of the jurisdictional posture of the case:
"I am going to take the [ANSER] defendants' motion for summary
judgment under advisement . . . . [I]f I grant the motion for summary
judgment, that moots out the case. It's over. If I do not grant it, I will
be referring [sic] it back to the [state] Court, because there are issues
of essentially state law that are involved in the case. It's more
16
appropriate for them to be handled in a state court. . . . [G]iven the
nature of the charges, they are better handled in State Court if we get
to that point." J.A. 320-21 (emphasis added). The hearing was then
adjourned.
In its "Memorandum Opinion and Order" entered four days later,
the district court, in summarizing the procedural setting, noted that
At the hearing of [the summary judgment] motions, plain-
tiffs' counsel advised the Court that defendant United States
was dismissed from the action. Without the federal defen-
dant there is no longer any basis for federal jurisdiction
because diversity does not exist among the remaining par-
ties. Defendants asked the court to retain jurisdiction solely
for the purpose of deciding [the federal-immunity issue]."
J.A. 323 (emphasis added).
After having then addressed the merits of the immunity issue, the
court opined that, "The defendants are not entitled to absolute immu-
nity . . . and their motion [for summary judgment on that basis] must
by DENIED . . . ." J.A. 325. Then, noting that the defendants also had
raised a defense of judicial proceeding evidentiary privilege, the court
observed that the standard under which such a privilege must be
assessed was one of Virginia state law, and opined that "a determina-
tion of whether defendants have met this standard is better left to a
Virginia tribunal." Id. (emphasis added). The court then "ORDERED
that this action be remanded to [the state court] pursuant to 28 U.S.C.
§ 1447(c)."
I deduce from this course of proceedings, despite some obvious
confusion at points along the way and flat error in the end as to the
court's power to remand, the following evolution of the district
court's understanding of the matter. When the hearing began, the
court had before it motions for summary judgment by both the United
States (as substituted defendant pursuant to the Westfall Act certifica-
tion) and the private defendants. Immediately upon finding out that
the United States had been voluntarily dismissed as a party, and after
learning upon inquiry that there was not diversity between the private
parties, the court perceived and raised a possible question of its juris-
17
diction over the claim against the (now re-substituted?) ANSER
defendants--but only in the form of a query to counsel. J.A. 307.
Having, however, then heard the ANSER defendants' contention that
by reason of their federal-immunity defense the court should "retain"
its jurisdiction over the claims against them, and that in any event it
could do so under the Gibbs rule, the court plainly acquiesced in the
assertion that it did have jurisdiction to do so by its rhetorical com-
ment that the jurisdiction was, however, "purely discretionary." J.A.
308. The fact that this was now the court's perception despite its ear-
lier intimation of doubt as to whether it had any basis for jurisdiction
is strongly borne out by what then occurred. First, the court proceeded
to consider the opposing arguments of counsel on the substantive
defense, expressing no more doubts about its jurisdiction to do so.
This alone might have indicated nothing more than conditional con-
sideration, with the jurisdictional question being reserved. That is
belied, however, by later comments that plainly indicate the court's
continued belief down to entry of its remand order that it had jurisdic-
tion of the claims against the ANSER defendants, but that it also had
discretionary power (as in the erroneously-suggested Gibbs situation)
not to exercise that jurisdiction once the federal defense to those
claims had been ruled out. Specifically, the court indicated to counsel
at that point that if it decided against immunity, it would remand the
case to state court because the issues then remaining would be essen-
tially state law issues, and it would be "more appropriate for them to
be handled in a state court", not that they must be handled there for
lack of its own jurisdiction.
That this perception of the basis for its power to remand persisted
to the time the remand order was entered is then confirmed in the
Memorandum Opinion supporting the remand. There again, the court
opined that with the case now involving only state law issues of claim
and defense, these were "better left to a State tribunal", not that they
must be remanded because of the court's lack of jurisdiction to deter-
mine them. In the face of this compelling evidence, the final citation
to § 1447(c) can only be understood as simple inadvertence, and we
certainly may do so.
On this basis, I conclude that review of the remand order, because
not actually based on either of the grounds specified in § 1447(c), is
not barred by § 1447(d).
18
C.
That leads, however, to the further question whether the remand
order is otherwise barred from review as an interlocutory order. Here,
the law is plain. It may not be reviewed by appeal because it does not
qualify as an appealable collateral order under the Cohen doctrine, but
it may be reviewed, if sufficiently egregious in error, by mandamus.
See Thermtron, 423 U.S. at 352-53. And, we may treat a notice of
appeal as a petition for mandamus when the stringent conditions for
issuing that writ are present. See Jamison v. Wiley, 14 F.3d 222, 234
(4th Cir. 1994). Here, they are. The result of allowing this remand
order to stand, even if erroneous, would be wrongly and unnecessarily
to fragment a claim between state and federal courts in a way fraught
with mischief and capable of producing unnecessary tensions between
the two systems. Principally, it could present difficult and unresolved
issues of a state court's power to re-examine a federal court's decision
on a federal-immunity defense to a remanded state-law claim, and
beyond that to inconsistent decisions were the state court to consider
itself free to re-examine the issue. The conditions for mandamus
review are therefore present and, accordingly we should treat the
notice of appeal as a petition for the writ.
D.
This then leads to the question whether the district court did have
the discretionary power it purported to exercise to remand the state
claim after having denied the federal-immunity defense to it.
On that issue, I am satisfied the court did not have that power but
was obliged to exercise its removal jurisdiction to resolve the whole
claim. I am aware of no direct authority for this conclusion in an
exactly comparable procedural setting. But it is supported by reason-
ing from analogous situations.
Had the ANSER defendants also petitioned for removal--as they
properly could have under § 1442(a)(1), the federal officer removal
statute--there would be specific case authority for this result. We
held in Jamison that in that situation, once removal jurisdiction
attached it was not thereafter defeated by rejection of the immunity
defense, and that there was accordingly no power under § 1441(c) to
19
remand the claim. Jamison v. Wiley, 14 F.3d 222, 239 (4th Cir. 1994).
Here, though removal was effected by the United States under the
Westfall Act, 28 U.S.C. § 2679, the effect recognized in Jamison
surely must be the same: that the jurisdiction properly acquired by the
removal was effectively mandatory and did not permit a discretionary
remand following denial of the federal immunity defense. As Jamison
recognized, the two removal provisions are complementary in their
intended operation, providing alternative means for getting such
claims into the federal courts on the basis of the federal immunity
defense. See id at 237-38 & n.16. Compare Carnegie Mellon v.
Cohill, 484 U.S. 343 (1988) (when removal jurisdiction is based on
§ 1441(a), district court has power to remand--rather than dismiss
without prejudice--pendent state-law claim following dismissal of
federal claims).
On this basis, I conclude that the district court erred in ordering a
remand of the claim (with the federal-immunity defense rejected) to
state court, and that it must therefore be vacated.
II
As to our jurisdiction to review the immunity ruling, I agree with
Judge Niemeyer that under Nixon v. Fitzgerald , 457 U.S. 731, 743
(1982), it is reviewable under the Cohen doctrine as a collateral order
denying absolute immunity. But I believe that our contemporaneous
vacatur of the remand order makes more certain--perhaps is essential
to--the immunity ruling's required finality as a collateral order, since
it removes any question of possible state court power to re-examine
that issue. Furthermore, that vacatur removes any need for concern
whether the remand order was one "preceding it in logic and fact."
See Jamison, 14 F.3d at 233.
ORDER
For the reasons given in parts I, III, and IV of Judge Niemeyer's
opinion and the entirety of Judge Phillips' opinion, we reverse the dis-
trict court's order denying the defense of absolute immunity, vacate
20
the district court's remand order, and remand the case to that court
with instructions to dismiss the action.
IT IS SO ORDERED
MICHAEL, Circuit Judge, dissenting:
I would dismiss this appeal because we do not have jurisdiction to
hear it. Because my able colleagues have taken jurisdiction, I must
also disagree with them on the substantive question. We are giving
away too much by granting absolute immunity to a government con-
tractor who is under no compulsion to report government employee
misconduct. I respectfully dissent.
I.
A.
This action, which was filed in the Circuit Court of Arlington
County, Virginia, included Lt. Col. James Rooney of the United
States Air Force as a defendant. Pursuant to 28 U.S.C. § 2679(d)(2)
the United States certified that Lt. Col. Rooney was"acting within the
scope of his . . . employment at the time of the incident out of which
the [Mangolds'] claim arose." The action, therefore, was deemed to
be one brought against the United States. The United States removed
it to federal court under § 2679(d)(2) and was substituted (by order)
as a defendant in place of Lt. Col. Rooney.
Later, on January 27, 1994, a consent order dismissed the case
against the United States with prejudice. Meanwhile, ANSER (the
corporate defendant) and the individual defendants moved for sum-
mary judgment on the ground that the doctrine of absolute immunity
barred the action against them. The district court heard this motion on
January 28, 1994, the day after the United States was dismissed. At
the beginning of the hearing the district court noted that with the
United States dismissed, "there is no longer any basis for Federal
jurisdiction." Defense counsel nevertheless asked the court to retain
jurisdiction in order to decide the immunity question. The court then
heard argument on immunity and ended the hearing by saying: "If I
21
do not grant [summary judgment to the defendants], I will be referring
[the case] back to the Arlington court, because these are issues of
essentially State law that are involved in the case. It's more appropri-
ate for them to be handled in a State court." The court indicated that
it would rule quickly.
Four days later, on February 1, 1994, the district court issued a
memorandum opinion and order. First, before taking up the immunity
issue, the court decided, "Without the federal defendant there is no
longer any basis for federal jurisdiction because diversity does not
exist among the remaining parties." But the court said it was "re-
tain[ing] jurisdiction," at the request of the defendants, "solely for the
purpose of deciding whether defendants' actions are entitled to an
absolute immunity because the allegedly defamatory statements were
made within the context of an Air Force investigation." The court
next discussed immunity and decided that "the defendants are not
entitled to absolute immunity." The court then returned to the jurisdic-
tional issue and ordered the action remanded to Virginia state court
under 28 U.S.C. § 1447(c). The defendants appealed the order of Feb-
ruary 1, 1994, and also petitioned for a writ of mandamus. We denied
the mandamus petition on March 22, 1994. We should now dismiss
the appeal because we have no jurisdiction to consider it.
B.
The district court's immunity ruling is included in its remand order
of February 1, 1994, and that order is before us on this appeal. The
order is first and last a remand order. The district court decided the
jurisdictional issue first, and only after announcing that it lacked sub-
ject matter jurisdiction did it turn to immunity. Because the ruling on
immunity was incidental to the order's essence -- remand to the Vir-
ginia court -- the immunity ruling was not conclusive. I do not see
any way that we have jurisdiction to review the remand order or any
of its discussion about immunity.
1.
Congress has denied us the jurisdiction to review remand orders:
"An order remanding a case to the State court from which it was
removed is not reviewable on appeal or otherwise," except in limited
22
circumstances not relevant here. 28 U.S.C. § 1447(d). This rule has
long been a part of American jurisprudence. See , e.g., Railroad Co.
v. Wiswall, 90 U.S. (23 Wall.) 507, 508 (1875); Mason v. Calloway,
554 F.2d 129, 130 (4th Cir.) (per curiam), cert. denied, 434 U.S. 877
(1977). Indeed, we have held that a district court lacks power even to
reconsider its own remand order. Three J Farms, Inc. v. Alton Box
Board Co., 609 F.2d 112 (4th Cir. 1979), cert. denied, 445 U.S. 911
(1980). See also John Steinman, Removal, Remand, and Review in
Pendent Claim and Pendent Party Cases, 41 Vand. L. Rev. 923, 997
nn. 349-50 (1988) (collecting cases).
The rule of non-reviewability is designed to allow cases to proceed
expeditiously to the merits. In other words, we are to avoid long, tech-
nical disputes about whether cases should be in state or federal court.
"Congress, by the adoption of [the rule of non-reviewability of
remand orders] established the policy of not permitting interruption
of the litigation of the merits of a removed cause by prolonged litiga-
tion of questions of jurisdiction of the district court to which the cause
is removed." United States v. Rice, 327 U.S. 742, 751 (1946). See also
In re Providencia Devel. Corp., 406 F.2d 251, 252 (1st Cir. 1969)
("The action must not ricochet back and forth depending on the most
recent determination of a federal court."); Charles A. Wright, Law of
Federal Courts 253-54 (1994) ("This ban on review is intended to
spare litigants delay.").
There is an exception to the rule of non-reviewability, the
"Thermtron exception." If the district court orders remand for a reason
not authorized by 28 U.S.C. § 1447(c),1 the remand order may be
challenged in the court of appeals by a petition for a writ of manda-
_________________________________________________________________
1 The authorized reasons for remand are "defect in removal procedure"
and "lack[ ] [of] subject matter jurisdiction" "at any time before final
judgment." 28 U.S.C. § 1447(c). The current version of § 1447 was
enacted in 1988. 102 Stat. 4670 (Pub. L. No. 100-702, Nov. 19, 1988).
Previously, remand was required if "the case was removed improvidently
and without jurisdiction." See 28 U.S.C.§ 1447(e) (1940). An earlier
statute required remand whenever the district court found that the case
was "improperly removed." 36 Stat. 1095 (Pub. L. No. 61-475, Mar. 3,
1911). The earliest history of the rule of non-reviewability of jurisdic-
tional remand orders is discussed at length in Rice, supra.
23
mus. Thermtron Prods., Inc. v. Hermansdorfer, 423 U.S. 336, 351-52
(1976) (remand order based on crowded docket was reviewable). See
also Kolibash v. Comm. on Legal Ethics of W. Va. Bar , 872 F.2d 571,
573 (4th Cir. 1989) (remand order "represent[ing] a discretionary
decision . . . not to hear a certain case on grounds of public policy"
was reviewable).
The scope of the Thermtron exception is extremely narrow. See,
e.g., Things Remembered, Inc. v. Petrarca , 116 S. Ct. 494, 498 (1995)
(Kennedy, J., concurring); Gravitt v. Southwestern Bell Tel. Co., 430
U.S. 723, 723 (1977) (per curiam) ("The district court's remand order
was plainly within the bounds of § 1447(c) and hence was unreview-
able by the Court of Appeals, by mandamus or otherwise."); Volvo of
Am., Corp. v. Schwarzer. 429 U.S. 1331 (Rehnquist, Circuit Justice
1976) (denying stay of remand order). Courts rarely invoke the
Thermtron exception. See Steinman, 41 Vand. L. Rev. at 999 n.364.
(collecting cases). "As the Supreme Court has stated, when a district
court remands a case on grounds contained in the statute ``his order
is not subject to challenge in the court of appeals by appeal, by man-
damus, or otherwise.'" Washington Suburban Sanitary Comm'n v.
CRS/Sirrine, Inc., 917 F.2d 834, 836 (4th Cir. 1990) (quoting
Thermtron, 423 U.S. at 343). Accord Wilkins v. Rogers, 581 F.2d 399,
402-03 (4th Cir. 1978) (per curiam); Noel v. McCain, 538 F.2d 63,
635 (4th Cir. 1976); Wright, supra at 253 n.25 (1994).
Here, the district court said that remand was based on a statutory
ground under § 1447(c), lack of subject matter jurisdiction. Near the
beginning of the hearing on the defendants' summary judgment
motion, the court interrupted defense counsel and said, "there is no
longer any basis for Federal jurisdiction." At the end of the hearing,
the court reiterated its belief that the case belonged in state court.
Before discussing immunity in its written opinion and order, the dis-
trict court expressly found that subject matter jurisdiction was lacking.2
Finally, the district court's order contained the magic reference to
_________________________________________________________________
2 By contrast, Carnegie Mellon Univ. v. Cohill, 484 U.S. 343 (1987),
and In re Surinam Airways Holding Co., 974 F.2d 1255, 1257 (11th Cir.
1992), upon which the majority relies, did not involve remand orders jus-
tified on the ground that jurisdiction was lacking. Thus, in those cases the
district courts did not invoke § 1447(c).
24
§ 1447(c): "it is hereby ORDERED that this action be remanded to
the Circuit Court of Arlington County in the Commonwealth of Vir-
ginia pursuant to 28 U.S.C. § 1447(c)." Because the remand order
expressly rested on the statute, the Thermtron exception does not
apply and this court has no power to review the district court's order.
The majority has concluded that the district court's invocation of
§ 1447(c) was simple inadvertence. But even if the district court
relied on § 1447(c) erroneously, we still have no power to review the
remand order. "[T]he words are indeed magic ones: the order is proof
against review even if it merely ``purports' to remand on the ground
quoted." Richards v. Federated Dep't Stores, Inc., 812 F.2d 211, 212
n.1 (5th Cir.) (per curiam), cert. denied, 484 U.S. 824 (1987). "Under
both Gravitt and Thermtron, a remand order made pursuant to
§ 1447(c) cannot be reviewed if it is based on the grounds that the
court lacks jurisdiction -- even if the court's jurisdictional analysis
was erroneous." Kunzi v. Pan American World Airways, Inc., 833
F.2d 1291, 1292 (9th Cir. 1987). See also Briscoe v. Bell, 432 U.S.
404, 414 n.13 (1977) ("review is unavailable no matter how plain the
legal error in ordering the remand"); Hansen v. Blue Cross of
California, 891 F.2d 1384, 1387 (9th Cir. 1989) ("Section 1447(d)
precludes review of a district court's jurisdictional decision even if it
was clearly wrong.").
2.
The majority says that the immunity ruling is reviewable under the
collateral order doctrine described in Cohen v. Beneficial Indus. Loan
Corp., 337 U.S. 541 (1949); Nixon v. Fitzgerald, 457 U.S. 731
(1982); and Jamison v. Wiley, 14 F.3d 222, 230 (4th Cir. 1994). I dis-
agree.
In Jamison v. Wiley, a remand order held reviewable by mandamus
under the Thermtron exception also contained a ruling that the defen-
dant (a federal employee) was not entitled to have the United States
substituted for him as defendant under the Westfall Act, 28 U.S.C.
§ 2679. We held that the substitution portion of the removal order
"was appealable under Cohen because it finally and conclusively
denied a claim of absolute immunity." Jamison , 14 F.3d at 234.
25
The reliance on Jamison is misplaced for three reasons. First, the
remand order there was not a § 1447(c) order. Instead, the district
court in Jamison described its action as a discretionary remand; it did
not rest on § 1447(c). Id. at 233. Here, by contrast, we have a
§ 1447(c) remand based expressly on the lack of subject matter juris-
diction. This leaves us without a basis for federal appellate jurisdic-
tion. In short, the case is gone, and we have no hook with which to
pull it back into federal court for any purpose, including appellate
review.
Second, the immunity ruling here, unlike the substitution decision
in Jamison, is within § 1447(d)'s barrier to appeal because the immu-
nity ruling did not "precede [the] order of remand, both ``in logic and
in fact.'" Jamison at 233 (quoting Waco v. United States Fidelity &
Guar. Co., 293 U.S. 140, 143 (1934)). In Jamison we noted that the
district court made the substitution ruling "before it decided to
remand the case to state court, while it still had control of the case.
That decision, which was made prior to, and is separable from, the
decision to remand, is not subject to the limitations of § 1447(d)." Id.
at 233 (emphasis in original). The immunity decision in the order
before us can perhaps be separated conceptually from the remand
decision, but the mere fact of separability is not enough under Waco.
Waco is of no help because the immunity decision here was made
after the district court decided to remand the case. 3 Jamison implicitly
recognized that § 1447(d) prevents appellate review of collateral rul-
ings made by a district court after its remand decision.
Third, Jamison does not permit an appeal here because the district
court's order did not "finally and conclusively[deny] a claim of abso-
lute immunity." See id. at 234. In Nixon v. Fitzgerald, 457 U.S. 731
(1982), the Supreme Court held that an interlocutory order denying
absolute immunity to a defendant about to go to trial in the district
court was appealable as a collateral order under Cohen. We have
observed that delaying an appeal from an order denying absolute
_________________________________________________________________
3 The Waco doctrine also does not apply because (as I discuss below)
the district court's immunity ruling would not bind the Virginia courts.
"City of Waco focused on the need to provide appellate review of find-
ings that are conclusive on the rights of the parties." Nutter v. Mononga-
hela Power Co., 4 F.3d 319, 321 (4th Cir. 1993) (emphasis supplied).
26
immunity "would defeat [the defendant's] claim that he should not be
put to trial, which is the initial protection of absolute privilege." Smith
v. McDonald, 737 F.2d 427 (4th Cir. 1984), aff'd, 472 U.S. 479
(1985).
The district court's order neither "finally determined," see Cohen,
337 U.S. at 546, nor "finally and conclusively denied a claim of abso-
lute immunity," see Jamison, 14 F.3d at 234. Nor did the defendants
face the imminent jeopardy of trial after the district court entered its
remand order.
On remand the Virginia courts would quickly recognize that the
district court's immunity ruling did not have preclusive effect. See
Nutter, 4 F.3d at 322 ("any issues that the district court decided inci-
dent to remand may be relitigated in state court"); McIntosh v. Atchi-
son, T. & S.F. Ry., 872 P.2d 11 (Kan. App. 1984) (ignoring federal
court's pre-remand conclusions of law). In particular, the law of the
case doctrine does not bind the Virginia courts to accept the federal
district court's immunity ruling. Steinman v. Clinchfield Coal Corp.,
93 S.E. 684, 688 (Va. 1917) ("the doctrine of the``law of the case'
does not apply to a former decision, in unended litigation, by a court
of a foreign jurisdiction").4 Even if the law of the case doctrine was
to apply, the Virginia courts would still have the power to revisit and
redetermine the immunity question. See, e.g., Capital Investors Co. v.
Executors, 584 F.2d 652, 654 (4th Cir. 1978) ("the principle [of law
of the case] is not absolute nor inflexible."), cert. denied, 440 U.S.
981 (1979); Wilson v. Volkswagen of America, Inc., 445 F. Supp.
1368, 1370 (E.D. Va. 1978) ("the law of the case doctrine ``is not an
inexorable command.'") (quoting Wm. G. Roe & Co. v. Armour &
Co., 414 F.2d 862, 867 (5th Cir. 1969)).
The district court's remand order does not force the defendants to
trial immediately. The defendants would be free to raise the defense
_________________________________________________________________
4 Although Steinman's validity has been questioned, Timms v.
Rosenblum, 713 F. Supp. 948, 954 n.13 (E.D. Va. 1989), aff'd, 900 F.2d
256 (4th Cir. 1990), no Virginia court has given any sign that Steinman
would not be followed. Indeed, the case was cited as good law as
recently as 1993. American Filtrona Co. v. Hanford, 428 S.E.2d 511, 514
(Va. App. 1993).
27
of immunity before the Virginia courts. Indeed, state courts regularly
rule on federal immunity defenses, see e.g., Cooney v. White, 845
P.2d 353 (Wyo.), cert. denied, 114 S. Ct. 60 (1993), and I am confi-
dent that the Virginia courts are well equipped to deal with the issue
in this case.
There is no statute, doctrine or rule that allows an appeal of the dis-
trict court's immunity ruling.
C.
It is tempting to do what the majority has done in this case, that is,
step back in the quiet of appellate review and try to figure out what
the district court really meant, regardless of its exact words. Until
today there was at least one instance where that could not be done:
where, as here, a district court ordered remand (even erroneously)
using the magic words of § 1447(c), review of that order was prohib-
ited under § 1447(d). Whatever the shortcomings of that rigid rule, it
had the benefits of preventing procedural wrangling and of letting the
parties know quickly and decisively whether they were going to be in
state or federal court. I do not believe it is up to us to take away any
of the benefits of that statutory rule.
II.
The majority's election to reach the immunity question forces me
to disagree a second time today. I disagree with the majority's unprec-
edented step of granting absolute immunity to a government contrac-
tor who was not acting pursuant to any duty imposed by contract,
statute or regulation. I do believe that the contractor and its employees
are entitled to a First Amendment qualified privilege. But the long
step from qualified to absolute immunity is a step too far.
A.
The Mangolds allege that the defendants engaged in a campaign of
lies against Col. Mangold with the intent to ruin his career and that
his career was ruined. The defendants say that they voluntarily
responded to queries from Air Force investigators because Col. Man-
28
gold was pressuring them to hire his wife's friend. At bottom, the
defendants claim that they may complain about alleged misconduct of
a government official to his superiors.
The defendants do have the important privilege to report miscon-
duct, but the privilege is not absolute. The only privilege defendants
have is grounded in the First Amendment's Petition Clause: "the right
of the people . . . to petition the Government for a redress of griev-
ances." See McDonald v. Smith, 472 U.S. 479, 483 (1985). However,
the Petition Clause does not give those who complain about the con-
duct of government officials an absolute right to tell lies about those
officials. Id.; White v. Nicholls, 44 U.S. (3 How.) 266 (1845); Bradley
v. Computer Sciences Corp., 643 F.2d 1029, 1033 (4th Cir.), cert.
denied, 454 U.S. 940 (1981). A charge of misconduct against a gov-
ernment official is privileged so long as the person making the charge
does not act with "actual malice," as that term is defined in First
Amendment free speech/free press jurisprudence. McDonald, 472
U.S. at 484-85. See also New York Times Co. v. Sullivan, 376 U.S.
254, 279-80 (1964) (actual malice is knowing falsity or reckless disre-
gard for whether a statement is true or false). Cf. Thorne v. Bailey,
846 F.2d 241, 245 (4th Cir.) (Petition Clause claim analyzed in accord
with First Amendment free speech principles), cert. denied, 488 U.S.
984 (1988).
"[T]hose who conspire intentionally to defame a federal officer in
order to effect that official's discharge" are not protected by the First
Amendment and may be sued for damages. Windsor v. The
Tennessean, 719 F.2d 155, 162 (6th Cir. 1983), cert. denied, 469 U.S.
826 (1984). This rule has long been recognized:
an individual, who maliciously, wantonly, and without prob-
able cause, asperses the character of a public officer in a
written or printed paper, delivered to those who are invested
with the power of removing him from office, is responsible
to the party injured in damages, although such paper is
masked under the specious cover of investigating the con-
duct of such officer for the public good. Public policy
demands no such sacrifice of the rights of persons in an offi-
cial capacity, nor will the law endure such a mockery of its
justice.
29
Gray v. Pentland, 2 Serg. & R. 23, 25 (Pa. 1815) (quoted in
McDonald, 472 U.S. at 483-84).
In short, "[t]he right to petition is guaranteed; the right to commit
libel with impunity is not." McDonald, 472 U.S. at 485. That is where
I would draw the line for the private contractors in this case, because
granting them absolute immunity gives them the right to tell deliber-
ate lies without fear of civil damages.
B.
The majority concludes that absolute immunity should be extended
to the private contractors here to promote the public interest of stamp-
ing out fraud, waste and mismanagement in government. This means,
of course, that if Col. Mangold is correct that the defendants lied and
ruined his career, he is without any remedy whatever.
I do agree that in the limited instances when private contractors are
obligated to speak, they should be granted absolute immunity. If the
defendants answered questions from the Air Force investigators
because they had a pre-existing, contractually-defined duty to do so,
then absolute immunity would be proper. Becker v. Philco Corp., 372
F.2d 771, 775 (4th Cir.) ("an utterance plainly commanded by the
duties of the author to the government has been repeatedly recognized
as unconditionally privileged") (emphasis supplied), cert. denied, 389
U.S. 979 (1967). Similarly, if a statute or Defense Department regula-
tions had imposed detailed reporting duties on the defendants, they
should have complete immunity. See Bushman v. Seiler, 755 F.2d
653, 655 (8th Cir. 1985) (Medicare providers granted absolute immu-
nity for carrying out "administrative responsibilities that the law
imposes").5
_________________________________________________________________
5 The majority's citation to Boyle v. United Technologies Corp., 487
U.S. 500 (1988), is not apposite. Boyle provides that a defense contractor
may not be held liable for certain kinds of products liability claims if "(1)
the United States approved reasonably precise specifications" for the
equipment produced and sold to the government, "(2) the equipment con-
formed to those specifications, and (3) the supplier warned the United
States about the dangers" of using the equipment. Id. at 512. The scope
of the Boyle privilege is extremely narrow and has no relevance here. See
id. at 505 n.1.
30
These defendants, however, were under no duty to report Col.
Mangold's alleged misconduct. Their decision to talk to Air Force
investigators was voluntary and was not compelled by any particular
contract, regulation or statute. See Group Health Inc. v. Blue Cross
Ass'n, 625 F. Supp. 69, 78-79 (S.D.N.Y. 1985) (denying a claim of
absolute immunity), appeal dismissed, 793 F.2d 491 (2d Cir. 1986),
cert. denied, 480 U.S. 930 (1987).
When determining whether absolute immunity should be granted,
courts must balance the harm to individual rights against the need to
promote "effective government." Westfall v. Erwin, 484 U.S. 292,
295-97 (1988). Certainly, granting these defendants absolute immu-
nity promotes effective government to some degree. Absolute immu-
nity encourages voluntary cooperation with the government's efforts
to investigate wrongdoing by its employees. But Westfall requires a
cost-benefit analysis, and the difficult question presented in this case
is whether, at the margin, the benefit resulting from a move from
qualified to absolute immunity outweighs the costs that move imposes
on government employees who are the target of complaints. See id.
at 296 n.3.
Here the marginal costs are substantial. Qualified immunity limits,
but does not eliminate, the rights of targeted employees. The move
from qualified to absolute immunity, however, is quite a jump
because absolute immunity completely extinguishes the rights even of
those employees who have suffered serious wrongs."[O]fficial immu-
nity comes at a great cost. An injured party with an otherwise merito-
rious tort claim is denied compensation simply because he had the
misfortune to be injured by [someone with immunity]. Moreover,
absolute immunity contravenes the basic tenet that individuals be held
accountable for their wrongful conduct." Id. at 295. An additional cost
(or danger) of the move from qualified to absolute immunity stems
from the fact that private government contractors are not subject to
political control. They do not answer to the voter, nor do they answer
to any official who does. There is thus no political check against the
fully immunized contractor who becomes reckless or malicious in his
zeal to expose a government employee. See Nu-Air Mfg. Co. v. Frank
B. Hall & Co., 822 F.2d 987, 995 (11th Cir. 1987), cert. denied, 485
U.S. 976 (1988). The benefit to effective government of giving addi-
tional protection to government contractors who talk voluntarily does
31
not outweigh the harm caused by leaving government employees
defenseless if they ever become the target of reckless and malicious
charges.
C.
Nor can the majority's significant expansion of immunity be justi-
fied on the ground that the defendants are entitled to a species of testi-
monial immunity. What happened here -- statements given in an
internal (non-public) Air Force investigation -- strays too far from
the core use of testimonial immunity. We give witnesses in certain
judicial proceedings, such as trials, absolute immunity so they will
feel free to testify fully and truthfully without fear of being sued for
the words they speak under oath.6
The trial (or adversarial) process contains safeguards to aid in the
search for truth. Most importantly, trial witnesses are subject to cross-
examination. See Briscoe v. LaHue, 460 U.S. 325, 342 (1983). See
also Williams, 844 F.2d at 142 (presence of the"tools of the judicial
process" justifies grant of absolute immunity from civil suit). A trial
also is a public proceeding, and a witness is less likely to lie if he
knows that his lies will be exposed to the entire world.7
_________________________________________________________________
6 Holmes v. Eddy, 341 F.2d 477(4th Cir.) (per curiam), cert. denied,
382 U.S. 892 (1965), cited by the majority, is best understood as a judi-
cial proceedings immunity case. There the defendant assisted the Securi-
ties and Exchange Commission in the prosecution of an ongoing civil
action.
7 Indeed, some courts have refused to grant absolute immunity for
statements made during judicial proceedings lacking the truth-promoting
safeguards of trial in open court. See Malley v. Briggs, 475 U.S. 335
(1986) (police officer not entitled to absolute immunity for false state-
ments made in warrant application); Anthony v. Baker, 955 F.2d 1395,
1400-01 (10th Cir. 1992) (not all grand jury testimony is absolutely priv-
ileged); Wheeler v. Cosden Oil & Chem. Co., 734 F.2d 254, 261 (abso-
lute immunity denied for statements made during pretrial hearing),
modified on other grounds, 744 F.2d 1131 (5th Cir. 1984); Cox v. County
of Suffolk, 780 F. Supp. 103, 108 (E.D.N.Y. 1991) (not all grand jury tes-
timony is absolutely privileged); White v. Frank, 680 F. Supp. 629, 638
(S.D.N.Y.) (same), appeal dismissed, 855 F.2d 956 (2d Cir. 1988). But
see Strength v. Hubert, 854 F.2d 421, 423-24 & n.2 (11th Cir. 1988)
(granting absolute immunity from civil suit to grand jury witness);
Kincaid v. Eberle, 712 F.2d 1023 (7th Cir.) (per curiam) (same), cert.
denied, 464 U.S. 1018 (1983).
32
Here, Col. Mangold had no opportunity to confront or cross-
examine his accusers. With absolute immunity, there is no check
against what they might have said in a shrouded, internal investiga-
tion. I realize that government investigators need the cooperation of
private contractors who witness wrongdoing, but absolute immunity
is too broad a brush for the delicate task of ensuring honest coopera-
tion.
D.
A First Amendment/Petition Clause approach goes just far enough
to protect the substantial public interest in bringing the misconduct of
public employees or officials to light. The qualified privilege under
the Petition Clause is a powerful privilege, and it is one that will ade-
quately protect those who cooperate honestly with government inves-
tigations. Even if a whistleblower is "motivated by financial self-
interest, and [is] aware of and pleased by the prospect of injury result-
ing to the official complained of," the accused employee may not
recover damages absent proof by clear and convincing evidence that
his accusers made statements that were knowingly or recklessly false.
Bradley, 643 F.2d at 1033. Accord Stern , 547 F.2d at 1329.
Again, I recognize the importance of ferreting out wrongdoing by
public officials and employees. My point is that false and malicious
charges of wrongdoing can be made. For those instances I would like
to leave the victim some protection. There is no protection when the
accuser in an internal investigation is given absolute immunity. I
respectfully dissent because I think qualified immunity is sufficient.
33