Horner v. Department of Mental Health

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 03-1658
WALTER HARRY HORNER, MD, PhD,
Plaintiff - Appellant,
versus
THE DEPARTMENT OF MENTAL HEALTH, MENTAL
RETARDATION AND SUBSTANCE ABUSE SERVICES; JACK
W. BARBER, MD; MARY CLARE SMITH, MD; JAMES
REINHARD,
Defendants - Appellees.
No. 04-1637
WALTER HARRY HORNER, MD, PhD,
Plaintiff - Appellant,
versus
THE DEPARTMENT OF MENTAL HEALTH, MENTAL
RETARDATION AND SUBSTANCE ABUSE SERVICES; JACK
W. BARBER; MARY CLARE SMITH,
Defendants - Appellees.
Appeals from the United States District Court for the Western
District of Virginia, at Harrisonburg. James H. Michael, Jr.,
Senior District Judge. (CA-02-99-5) James C. Turk, Senior
District Judge. (CA-03-37-5)
Argued: October 26, 2005 Decided: December 2, 2005
Before WILKINS, Chief Judge, and NIEMEYER and KING, Circuit Judges.
Vacated and remanded by unpublished per curiam opinion.
ARGUED: William Richard Goode, Portland, Oregon, for Appellant.
Sydney E. Rab, Senior Assistant Attorney General, OFFICE OF THE
ATTORNEY GENERAL OF VIRGINIA, Richmond, Virginia, for Appellees.
ON BRIEF: Tate C. Love, BLACK, NOLAND & READ, P.L.C., Staunton,
Virginia, for Appellant. Jerry W. Kilgore, Attorney General of
Virginia, Joseph R. Carico, Chief Deputy Attorney General, Judith
Williams Jagdmann, Deputy Attorney General, Edward M. Macon, Senior
Assistant Attorney General, OFFICE OF THE ATTORNEY GENERAL OF
VIRGINIA, Richmond, Virginia, for Appellees.
Unpublished opinions are not binding precedent in this circuit.
See Local Rule 36(c).
2
PER CURIAM:
In these consolidated appeals, Walter Harry Horner challenges
the district court’s dismissals of his employment-related actions
against the Virginia Department of Mental Health, Mental
Retardation and Substance Abuse Services (the “Department”) and
various Department officials. The court dismissed the first of
these suits (“Horner I”) for lack of subject matter jurisdiction
under the Rooker-Feldman doctrine. See Horner v. Dep’t of Mental
Health, Mental Retardation & Substance Abuse Servs., No. CA-02-99-
5, slip op. at 5-9 (W.D. Va. May 1, 2003) (citing, inter alia, D.C.
Court of Appeals v. Feldman, 460 U.S. 462 (1983); Rooker v. Fid.
Trust Co., 263 U.S. 413 (1923)). The court subsequently dismissed
the second suit (“Horner II”) on the ground of collateral estoppel.
See Horner v. Dep’t of Mental Health, Mental Retardation &
Substance Abuse Servs., No. CA-03-37-5, slip op. at 6-7 (W.D. Va.
Apr. 26, 2004).
Each of the district court’s dismissal orders turned on prior
decisions of a state grievance hearing officer. After the court’s
dismissal orders were rendered, however, the Supreme Court of
Virginia determined that Horner’s grievances had not been properly
before the hearing officer. See Horner v. Dep’t of Mental Health,
Mental Retardation & Substance Abuse Servs., 597 S.E.2d 202 (Va.
3
2004). We therefore vacate the dismissal orders of the district
court and remand for further proceedings.1
I.
On May 15, 2001, Horner was discharged from his position with
the Department as a physician at Western State Hospital in
Staunton, Virginia. Horner’s termination was based on his receipt
of three “Group II” disciplinary notices; discharge is warranted on
the accumulation of two such notices. Horner utilized Virginia’s
statutory grievance procedure to contest the alleged workplace
violations underlying the notices. See Va. Code Ann. §§ 2.2-3000to -3008. At some point during the grievance process, he also
raised the contention that he had been fired in retaliation for
being an outspoken critic — both internally and publicly — of
hospital policies and practices.
The grievance procedure in place at that time provided for up
to three levels of management review, followed by a formal hearing.
Horner’s immediate supervisor, as the first-level respondent,
supported reversal of the disciplinary notices and resolved that
Horner should be reinstated with back pay and restoration of fringe
benefits. Horner’s response was to conclude his grievance.
1
In ruling today, we express no opinion on the propriety of
the district court’s dismissal orders under the circumstances that
existed when they were entered, or on the present viability of the
Horner I and Horner II claims.
4
However, the Department proceeded to the second- and third-level
respondents, who each disagreed with the first-level respondent and
pronounced that Horner should be denied relief.
Thereafter, the matter went before the grievance hearing
officer. One of the notices was subsequently dismissed. In
separate decisions issued on August 20, 2001, the hearing officer
upheld the two remaining notices, which together were sufficient to
warrant Horner’s discharge. The hearing officer explicitly
rejected Horner’s allegation that his termination had been
retaliatory, observing that Horner presented no evidence on which
to base a finding of retaliation. See J.A. 26-27, 37-38.2
After losing on reconsideration by the hearing officer and
exhausting his administrative appeals, Horner appealed to the
Circuit Court of the City of Staunton. See Va. Code Ann. § 2.2-
3006(B) (authorizing such appeal on grounds that hearing officer’s
decision was “contradictory to law”). By its opinion of July 11,
2002, the circuit court reversed the hearing officer’s decisions on
one of several grounds asserted by Horner: that under the
statutory grievance procedure, the first-level respondent’s
determination in Horner’s favor was final, and no further
proceedings (including those before the hearing officer) were
authorized. Without reaching Horner’s other contentions, the court
2
This citation to the “J.A.” refers to the contents of the
Joint Appendix filed by the parties in these consolidated appeals.
5
awarded the remedy that had been deemed appropriate by the first-
level respondent — reinstatement with back pay and restoration of
fringe benefits. See Horner v. Dep’t of Mental Health, Mental
Retardation & Substance Abuse Servs., No. CL01000109-00 (Va. Cir.
Ct. entered Sept. 5, 2002).
On September 30, 2002, the Department filed a notice of appeal
in the Court of Appeals of Virginia. In its opinion of April 22,
2003, the court of appeals reversed the ruling of the circuit court
and remanded for consideration of Horner’s other grounds for
challenging the decisions of the hearing officer. See Dep’t of
Mental Health, Mental Retardation & Substance Abuse Servs. v.
Horner, 579 S.E.2d 372, 373 (Va. Ct. App. 2003).3
Meanwhile, during the pendency of the Department’s appeal in
the court of appeals, Horner initiated these federal court
proceedings. Specifically, on October 11, 2002, Horner filed his
complaint in the Western District of Virginia in Horner I, alleging
retaliation claims under 42 U.S.C. § 1983 for infringement of his
free speech rights and under Virginia law for violation of the
Commonwealth’s public policy. The Department and other Horner I
Defendants subsequently filed a motion to dismiss. In a report and
recommendation of March 14, 2003, the magistrate judge advised the
district court to grant the motion to dismiss on the ground that
3
On June 23, 2003, following the denial of rehearing en banc
by the court of appeals, Horner noticed an appeal to the Supreme
Court of Virginia.
6
the court lacked subject matter jurisdiction under the Rooker-
Feldman doctrine. On May 1, 2003, the court dismissed Horner I in
accordance with the magistrate judge’s recommendation — a ruling
that hinged on the administrative decisions of the grievance
hearing officer.
Two weeks later, on May 14, 2003, Horner filed his complaint
in the Western District of Virginia in Horner II, again alleging a
retaliation claim under § 1983 for infringement of his free speech
rights, and for the first time alleging a retaliation claim under
§ 504 of the Rehabilitation Act of 1973, 29 U.S.C. § 794. The
Department and other Horner II Defendants filed a motion to dismiss
and, on November 4, 2003, the magistrate judge recommended
dismissal (as he had in Horner I) under the Rooker-Feldman
doctrine. On April 26, 2004, the district court granted the
motion. Rather than relying on the Rooker-Feldman doctrine,
however, the court concluded that it was obliged under the doctrine
of collateral estoppel to give the decisions of the grievance
hearing officer — including his findings of no retaliation — issue
preclusive effect.
Horner filed timely notices of appeal in both Horner I and
Horner II. Thereafter, by its opinion of June 10, 2004, the
Supreme Court of Virginia reinstated and affirmed the decision of
the Circuit Court of the City of Staunton that Horner’s grievances
had not been properly before the grievance hearing officer, because
7
the determination of the first-level respondent was a final one.
See Horner v. Dep’t of Mental Health, Mental Retardation &
Substance Abuse Servs., 597 S.E.2d 202, 206 (Va. 2004). In
reaching its decision, the supreme court observed that “the
legislature provided the employee with the substantive right to be
afforded a remedy by the first-level respondent.” Id. at 205.
Accordingly, the court held that “[o]nce the employee accepted the
remedy, the statutory scheme existing at the time precluded
management from contesting the first-level decision.” Id. The
Department sought reconsideration, but the court denied rehearing
on October 1, 2004.
With the benefit of the intervening opinion of the Supreme
Court of Virginia, we now address Horner’s appeals of the district
court’s dismissal orders in Horner I and Horner II. We possess
jurisdiction over these appeals under 28 U.S.C. § 1291.
II.
A.
As explained above, the district court dismissed Horner I for
lack of subject matter jurisdiction under the Rooker-Feldman
doctrine. We review the application of this doctrine de novo. See
Burrell v. Virginia, 395 F.3d 508, 511 (4th Cir. 2005).
In applying the Rooker-Feldman doctrine here, the district
court relied on the established principle that federal courts lack
8
jurisdiction to hear “constitutional claims presented or
adjudicated by the state courts,” as well as “claims that are
inextricably intertwined with a state court judgment.” See Jordahl
v. Democratic Party of Va., 122 F.3d 192, 199 (4th Cir. 1997)
(internal quotation marks omitted). The court concluded, first,
that the grievance hearing officer’s decisions (and particularly
his findings of no retaliation) were the result of an adjudicatory
process subject to application of the Rooker-Feldman doctrine, and,
second, that the doctrine was appropriately applied herein because
the Horner I retaliation claims were based on the same essential
facts as the retaliation claims before the grievance hearing
officer.4
Because the state administrative decisions at the heart of the
district court’s Rooker-Feldman ruling were the decisions of the
grievance hearing officer, we must vacate the court’s dismissal
order in Horner I. Although the Virginia courts did not (for
whatever reason) address the hearing officer’s factual findings,
the Supreme Court of Virginia ultimately concluded that the hearing
4
Notably, following entry of the district court’s dismissal
orders and after these appeals were filed, the Supreme Court
decided Exxon Mobil Corp. v. Saudi Basic Industries Corp.,
emphasizing that the Rooker-Feldman doctrine is to be narrowly
applied, only in “cases brought by state-court losers complaining
of injuries caused by state-court judgments rendered before the
district court proceedings commenced and inviting district court
review and rejection of those judgments.” 125 S. Ct. 1517, 1521-22
(2005). The parties have submitted supplemental briefs outlining
their views on the effects of Exxon Mobil herein. That issue,
however, is outside the purview of our ruling today.
9
officer had lacked authority to hear Horner’s claims. In other
words, the hearing officer’s decisions are a nullity and therefore
cannot serve as the basis for the application of the Rooker-Feldman
doctrine.
B.
The district court dismissed Horner II based on its conclusion
that it was obliged under the doctrine of collateral estoppel to
give the decisions of the grievance hearing officer issue
preclusive effect. We review the application of collateral
estoppel de novo. See Tuttle v. Arlington County Sch. Bd., 195
F.3d 698, 703 (4th Cir. 1999).
The district court relied for its collateral estoppel ruling
on the principle “that when a state agency acting in a judicial
capacity resolves disputed issues of fact properly before it which
the parties have had an adequate opportunity to litigate, federal
courts must give the agency’s factfinding the same preclusive
effect to which it would be entitled in the State’s courts.” Univ.
of Tenn. v. Elliott, 478 U.S. 788, 799 (1986) (internal quotation
marks and alteration omitted) (emphasis added). Here, of course,
the Supreme Court of Virginia has now clearly ruled that Horner’s
grievances were not properly before the grievance hearing officer.
Accordingly, the hearing officer’s findings are not entitled to be
given issue preclusive effect, and we are also constrained to
vacate the district court’s Horner II dismissal order.
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III.
Pursuant to the foregoing, we vacate the district court’s
dismissal orders in Horner I and Horner II, and remand for such
other and further proceedings as may be appropriate.
VACATED AND REMANDED
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