Stephen Stem v. Ruben Gomez

Case: 15-50264 Document: 00513372971 Page: 1 Date Filed: 02/08/2016
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
United States Court of Appeals
Fifth Circuit
No. 15-50264 FILED
February 8, 2016
STEPHEN C. STEM, Lyle W. Cayce
Clerk
Plaintiff - Appellant
v.
RUBEN GOMEZ; CITY OF HEARNE, TEXAS,
Defendants - Appellees
Appeal from the United States District Court
for the Western District of Texas
Before PRADO, SOUTHWICK, and GRAVES, Circuit Judges.
LESLIE H. SOUTHWICK, Circuit Judge:
City councilmembers in Hearne, Texas, terminated former police officer
Stephen Stem’s employment without notice or a hearing. Stem filed suit
alleging the councilmembers’ actions violated state law and denied him
constitutional due process. The district court dismissed the suit. We AFFIRM
in part and REVERSE and REMAND in part.
FACTS AND PROCEDURAL BACKGROUND
On May 6, 2014, Stephen Stem, a second-year officer at the Hearne
Police Department, was dispatched to Hearne resident Pearlie Golden’s home
on a 9-1-1 call. Roy Jones, Golden’s nephew, placed the emergency call. Jones
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said Golden, who had recently failed a driver’s license renewal test, threatened
him with a gun after he had taken away her car keys. Stem alleged that when
he arrived at the home, Golden pointed the gun at him and refused to put it
down upon Stem’s direction. Stem said he then fired his weapon “in response
to the immediate and deadly threat.” Golden was wounded and later died.
Stem alleged that following the shooting there were “considerable
protests from residents of Hearne” and groups from outside Hearne. The
Hearne City Council posted a notice for a May 10 meeting, listing Stem’s
employment as an agenda item. The mayor and city attorney announced prior
to the meeting that they would recommend terminating Stem. At the May 10
meeting, councilmembers discharged Stem. Stem said he never received a
signed, written complaint from any city official prior to his dismissal.
In September 2014, a Texas grand jury failed to indict Stem on any
charges related to the incident. One month later, Stem filed this lawsuit
against the city of Hearne, Texas, and its mayor in his individual and official
capacities (collectively, the “defendants”). Stem alleged that Texas
Government Code Section 614.023 created a “constitutionally protected
property interest” in his employment as a police officer. Section 614.023
provides that where a “complaint” is filed against an officer covered by the
statute 1:
(a) A copy of a signed complaint . . . shall be given to the officer
. . . within a reasonable time after the complaint is filed.
(b) Disciplinary action may not be taken against the officer . . .
unless a copy of the signed complaint is given to the officer . . . .
(c) . . . [T]he officer . . . may not be indefinitely suspended or
terminated from employment based on the subject matter of the
1The parties do not contest that Stem was a “peace officer” under Texas Government
Code Chapter 614.
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complaint unless:
(1) the complaint is investigated; and
(2) there is evidence to prove the allegation of misconduct.
Tex. Gov’t Code Ann. § 614.023.
Stem argues that the defendants’ “prejudg[ment]” of him and failure to
provide due process in connection with his termination deprived him of due
process under the Fourteenth Amendment. Stem brought suit for the
deprivation under 42 U.S.C. § 1983. Stem also sought a declaratory judgment
that the defendants violated his constitutional rights and state law by
terminating his employment without following the requirements of Section
614.023. The defendants moved to dismiss for lack of subject matter
jurisdiction and failure to state a claim. Stem opposed the motion and also
sought leave to amend any deficiencies in his complaint. In January 2015, the
district court denied leave to amend and dismissed for failure to state a claim
and for lack of jurisdiction. Stem timely appealed.
DISCUSSION
A district court decision to dismiss for failure to state a claim or for lack
of subject matter jurisdiction is reviewed de novo. Bowlby v. City of Aberdeen,
681 F.3d 215, 219 (5th Cir. 2012) (failure to state a claim); Ghanem v.
Upchurch, 481 F.3d 222, 223 (5th Cir. 2007) (lack of subject matter
jurisdiction). In analyzing the claims, all well-pleaded facts are accepted as
true and should be examined “in the light most favorable to the plaintiff.”
Bowlby, 681 F.3d at 219. Dismissal is appropriate if a complaint fails to plead
sufficient “facts to state a claim . . . that is plausible[, rather than merely
conceivable,] on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).
“A claim has facial plausibility when the . . . [complaint’s] factual content . . .
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allows the court to draw the reasonable inference that the defendant is liable.”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
Denial of a motion to amend is reviewed for abuse of discretion. Ackerson
v. Bean Dredging LLC, 589 F.3d 196, 208 (5th Cir. 2009).
I. Dismissal for Lack of Jurisdiction
The defendants argue that the district court lacked subject matter
jurisdiction. They contend that because Stem had no property interest in
continued employment, there was no jurisdiction to consider his Section 1983
claim. The argument blurs jurisdiction with the merits. If the challenge to
jurisdiction “is also a challenge to the existence of a federal cause of action,” a
district court should assume jurisdiction exists and “deal with the objection as
a direct attack on the merits of the plaintiff’s case.” Williamson v. Tucker, 645
F.2d 404, 415 (5th Cir. May 1981) (relying on Bell v. Hood, 327 U.S. 678, 682
(1946)). So long as a complaint is drafted “to seek recovery directly under the
Constitution or laws of the United States,” a “failure to state a proper cause of
action calls for a judgment on the merits and not for a dismissal for want of
jurisdiction.” Bell, 327 U.S. at 681–82. More recently, the Supreme Court
explained that “the nonexistence of a cause of action [is] no proper basis for a
jurisdictional dismissal.” Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83,
96 (1998). The only exceptions are where the claim was clearly made “for the
purpose of obtaining jurisdiction” or is “frivolous.” Bell, 327 U.S. at 682–83.
Stem stated a claim for relief under a federal statute. See 42 U.S.C.
§ 1983; 28 U.S.C. § 1331. It was not frivolous, and the Bell exceptions are
inapplicable. The district court erred in dismissing Stem’s claims for lack of
jurisdiction.
The court also dismissed for failure to state a claim. We turn to whether
that dismissal was valid.
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II. Dismissal of Section 1983 Claim
To state a claim under Section 1983, a plaintiff must assert facts to
support that a person acting under color of state law denied the plaintiff a right
under the Constitution or federal law. Martin v. Thomas, 973 F.2d 449, 452–
53 (5th Cir. 1992). A “person” includes a local governing body if the action
claimed to be unconstitutional implemented a “decision officially adopted and
promulgated by that body’s officers.” Monell v. Dep’t of Soc. Serv., 436 U.S.
658, 690 (1978). When a government official is sued under Section 1983, the
plaintiff must allege that the official “was either personally involved in the
deprivation or that his wrongful actions were causally connected” to it. James
v. Tex. Collin Cnty., 535 F.3d 365, 373 (5th Cir. 2008).
Stem asserts that Section 614.023, particularly subsection (c) which
established a procedure for addressing complaints, provided him with a
constitutionally protected property interest in his job. He alleges that he was
unlawfully denied due process guaranteed to him under the Fourteenth
Amendment when the mayor recommended discharging him without notice or
a hearing and the Hearne City Council acted on that recommendation.
A property interest is more than “an abstract need,” a “desire,” or a
“unilateral expectation” to continued employment. Board of Regents v. Roth,
408 U.S. 564, 577 (1972). A claimant must show a “legitimate claim of
entitlement” to a procedure which is intended to protect an interest “acquired
in specific benefits,” in this case, a job. See id. at 576–77. A property interest
will exist in continued employment if the right to terminate without cause is
eliminated. See Bolton v. City of Dallas, 472 F.3d 261, 264 (5th Cir. 2006).
Conversely, an employee who is terminable at will generally has no
constitutionally-protected property interest. See Muncy v. City of Dallas, 335
F.3d 394, 398–99 (5th Cir. 2003).
A property interest is not derived from the Constitution but from an
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independent source such as state law, a contract, or other “understandings.”
Evans v. City of Dallas, 861 F.2d 846, 848 (5th Cir. 1988). Therefore, a property
interest “cannot be defined by the procedures provided for its deprivation.”
Cleveland Bd. of Educ. v. Loudermill, 470 U.S. 532, 541 (1985). Though state
law is the source of the right, the question of whether a property interest is
created is answered by federal constitutional law. Town of Castle Rock v.
Gonzales, 545 U.S. 748, 756–57 (2005).
Stem argues that because his dismissal related to “complaints about his
use of force against Ms. Golden,” Section 614.023 provided him with a right to
continued employment unless the city could produce corroborating evidence
that proved the alleged misconduct. See Tex. Gov’t Code Ann. § 614.023(c). He
expanded that assertion at oral argument, contending that Section 614.023
sets a for-cause threshold for dismissal of an officer protected by the statute
whenever either a citizen complaint or a criticism from inside city government
“may lead to disciplinary action.”
For support, Stem cites a state appellate decision. See Turner v. Perry,
278 S.W.3d 806 (Tex. App.—Houston [14th Dist.] 2009, pet. denied). There, a
school district terminated a peace officer’s employment for job performance
deficiencies including “inappropriate interaction with students.” Id. at 813.
The officer filed a lawsuit which included a due process claim stemming from
the school district’s failure to follow the requirements of Section 614.023(c) in
firing him. Id. at 813, 821–22. The intermediate Texas court agreed. It held
that state law and district policy adopting Section 614.023(c) conferred a
property interest on the officer: “in the absence of complaints that were signed,
delivered, investigated, and supported by evidence, [the officer] had a
legitimate expectation of continued employment.” Id. at 822.
A different Texas intermediate court seemingly disagreed with this
reasoning, holding that the statute did not alter the general rule of at-will
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employment. Staff v. Wied, 470 S.W.3d 251, 258 (Tex. App.—Houston [1st
Dist.] 2015, pet. filed).
The defendants in this case argue that Section 614.023(c) provides
nothing more than a “procedure for terminating an officer when the
termination from employment is ‘based on the subject matter’ of a complaint.”
The district court agreed, citing Texas’s presumption of an at-will employment
relationship and finding nothing in the statute that would affect the
presumption. Dismissing Stem’s reliance on the Turner decision, the district
court said its result “was the combination of the statute and [a] policy manual”
specifically adopting Section 614.023, “which created the property interest
found in that case, and which is not present in this case.”
The district court was correct that Turner emphasized the school
district’s incorporation of Section 614.023 into its manual. See Turner, 278
S.W.3d at 822 & n.21. Nonetheless, state statutes themselves can create a
property right in continued employment. See Henderson v. Sotelo, 761 F.2d
1093, 1095–96 (5th Cir. 1985) (citing Slochower v. Bd. of Higher Educ., 350
U.S. 551, 554, modified on denial of reh’g, 351 U.S. 944 (1956)). The statutory
procedures at issue are to be applied in certain disciplinary situations without
any stated requirement that they first be adopted by the governing body itself
as policy. See Tex. Gov’t Code Ann. §§ 614.021–.023.
Stem argues that Section 614.023 grants covered employees the right to
a finding of cause before they can be fired. A causal basis for termination is
generally not needed in Texas, where employment is at-will unless a contract,
statute, or other authority overrides that presumption. See Mott v.
Montgomery Cnty., 882 S.W.2d 635, 637–38 (Tex. App.—Beaumont 1994, writ
denied). Section 614.023 certainly does not explicitly provide that an officer
facing a complaint can only be terminated for cause. Section 614.023 also does
not resemble other statutes that clearly establish such a rule. For example, a
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stronger argument for a property interest would arise from a statute that
requires a Civil Service Commission authorized by a city’s electorate to “adopt
rules that prescribe cause for removal or suspension” for police and fire
personnel. Tex. Loc. Gov’t Code Ann. §§ 143.008, 143.051; see also 59 TEX. JUR.
3D POLICE, ETC. § 28 (explaining the process due before an officer may be
terminated under Section 143.051). We also must consider that “courts should
not insert words in a statute except to give effect to clear legislative intent.” In
re Bell, 91 S.W.3d 784, 790 (Tex. 2002).
Before a property interest would exist, Section 614.023 would have to
constrain the city in a meaningful way from discharging a protected employee.
There is no property right if rules only provide considerations for the exercise
of discretion. See Moore v. Otero, 557 F.2d 435, 437 n.6 (5th Cir. 1977). To
determine whether the statute meaningfully limits the city’s discretion, we
examine how the statute operates, its relevant legislative history, and case
law.
First, Section 614.023’s protections apply when disciplinary action is
based on the subject of a “complaint.” One implication is that in all other
situations, an officer may be discharged for a good reason, a bad reason, or no
reason without the process provided. Stem does not assert that his termination
was the result of any particular person’s submission to his employer of an
objection to Stem’s conduct. Regardless, as discussed in more detail below, we
decline to delve into the question of whether a “complaint” exists. No authority
from the Texas Supreme Court has been discovered defining that state
statutory term, and we may avoid announcing a non-authoritative definition.
Second, the relevant legislative history, including a staff-prepared “bill
analysis,” is instructive. In determining the meaning of a statute, the Texas
Supreme Court analyzes statements by the legislation’s authors, testimony at
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committee hearings, and bill analyses. 2 Quick v. City of Austin, 7 S.W.3d 109,
123 (Tex. 1998). When Section 614.023(c) was enacted in 2005, the bill analysis
prepared by the Texas House Research Organization stated that the original
draft of the legislation required that there be “sufficient evidence,” not just
“evidence” as provided in the final statute. TEX. H. RESEARCH ORG., BILL
ANALYSIS, H.B. 639, 79th Leg., Reg. Sess. (2005). Legislative drafters
intentionally declined to define what would constitute “sufficient evidence to
prove an allegation of misconduct,” so that “discretion to decide what is
sufficient [would be] in the hands of the state and local departments, where it
lies already.” Id. Additionally, before sending the bill to the Texas Senate for
consideration, state representatives removed the term “sufficient” altogether,
thereby eliminating any threshold amount of evidence that must be present
before disciplinary action may be taken. TEX. H. JOURNAL, H.B. 639, 79th Leg.,
Reg. Sess., 565–66 (2005).
Third, in other cases, we have considered laws requiring a specific
procedure to be followed prior to termination and held that no property interest
existed. One of our decisions dealt with a building inspector who filed suit
under Section 1983 against a city because his employment was summarily
terminated. Henderson, 761 F.2d at 1094–95. The inspector claimed he was
unlawfully deprived of property without due process of law. Id. at 1095. He
claimed a property interest in continued employment in the city charter, which
2 The Texas Legislature’s House Research Organization and Senate Research Center
prepare bill analyses to explain the “version of [a] bill as it was reported by [a] . . . committee
and first considered by” the corresponding body. Tex. H. Research Org., Bill Analyses, TEX.
HOUSE OF REPRESENTATIVES, http://www.hro.house.state.tx.us/BillAnalysis.aspx (last
visited Dec. 6, 2015); Tex. Senate Research Ctr., Bill Analyses, TEX. SENATE,
http://www.senate.state.tx.us/SRC/BA.htm (last visited Dec. 6, 2015). Texas courts consider
bill analyses as persuasive legislative history in determining legislative intent. See Quick v.
City of Austin, 7 S.W.3d 109, 123 (Tex. 1998).
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“provide[d] that the City Manager ‘shall . . . appoint and/or remove all
department heads . . . with the advice and consent of the [City] Commission.’”
Id. at 1096. We held that the charter provision was a pre-termination
procedure that did not create a property right. Id. at 1097. One of the Texas
courts of appeals, when analyzing Section 614.023, relied in part on Henderson
to hold that “either the State or the employer may implement policies and
procedures for resolving complaints and grievances without altering the
employee’s status as an at-will employee.” Staff, 470 S.W.3d at 258.
In summary, there is no authoritative decision from the Texas Supreme
Court as to whether Section 614.023(c) creates a property interest. When
interpreting state law, we are “guided by the decisions of state intermediate
appellate courts unless other persuasive data indicate[] that the [state’s]
Supreme Court would decide otherwise.” Patin v. Thoroughbred Power Boats
Inc., 294 F.3d 640, 646 (5th Cir. 2002). Here, there is a disagreement among
the state courts of appeals. Compare Staff, 470 S.W.3d at 258, with Turner,
278 S.W.3d at 821–22. In our view, Section 614.023 assures that an officer
against whom a complaint is filed understands the allegations against him and
receives a meaningful investigation into the accuracy of those allegations. A
right to an investigation, though, does not create a property right. See
Henderson, 761 F.2d at 1097–98; Davis v. Dallas Indep. Sch. Dist., 448 F. App’x
485, 496 (5th Cir. 2011). A city’s “‘merely conditioning an employee’s removal
on compliance with certain specified procedures’ does not necessarily mean
that an employee has a substantive property right in continued employment.”
Irby v. Sullivan, 737 F.2d 1418, 1422 n.4 (5th Cir. 1984) (quoting Bishop v.
Wood, 426 U.S. 341, 345 (1976)). We also know that the legislation was not
aimed at abrogating the right to discharge at will. TEX. H. RESEARCH ORG.,
BILL ANALYSIS, H.B. 639, 79th Leg., Reg. Sess. (2005). Finally, it is not even
clear that the statute applies here, because the statutory meaning of a
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“complaint” is unsettled.
The district court did not err in dismissing Stem’s Section 1983 claim.
Section 614.023 is analogous to the charter provision in Henderson. Both laws
require some action to be taken before termination of employment can occur,
but no property right is created by that requirement.
III. Dismissal of State-Law Claims
The district court implicitly dismissed Stem’s claims under the Federal
Declaratory Judgment Act and against the mayor in his individual capacity
when it dismissed the case. Stem does not argue on appeal that this was error.
If a party fails to mention a district court’s disposition of certain claims in its
briefing, such claims “are considered abandoned.” Huckabay v. Moore, 142
F.3d 233, 238 n.2 (5th Cir. 1998). Thus, we decline to discuss the Federal
Declaratory Judgment Act or the individual claim against the mayor.
Stem’s state-law declaratory relief claim was brought under the Texas
Uniform Declaratory Judgment Act, Texas Civil Practice and Remedies Code
Chapter 37. He seeks back pay and benefits against the city and mayor in his
official capacity. The district court concluded that sovereign immunity barred
such relief. Additionally, the district court held that Stem failed to sue the
proper parties and that Section 614.023 is inapplicable to Stem’s situation.
Under Texas law, sovereign immunity protects the state, its political
subdivisions, and cities from lawsuits for money damages or other retroactive
relief by depriving a court of subject matter jurisdiction. See City of El Paso v.
Heinrich, 284 S.W.3d 366, 375–76 (Tex. 2009); Reata Constr. Corp. v. City of
Dallas, 197 S.W.3d 371, 374 (Tex. 2006). Immunity still applies when a
plaintiff mischaracterizes a suit for money damages as one for a declaratory
judgment. City of Dallas v. Albert, 354 S.W.3d 368, 378 (Tex. 2011). Though
sovereign immunity may be waived, there is no waiver in Section 614.023 and
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its related sections. See Tex. Gov’t Code Ann. §§ 614.021–.023. Because
sovereign immunity has not been waived, we agree that Stem is not entitled to
seek back pay or benefits.
Stem, however, also seeks prospective relief in the form of reinstatement.
He contends that the ultra vires exception to sovereign immunity allows his
claim for prospective relief to proceed. The Texas Supreme Court has clarified
the law related to claims for declaratory relief and this exception. See
Heinrich, 284 S.W.3d at 375–76. In Heinrich, the widow of a police officer filed
suit under the Texas Uniform Declaratory Judgment Act claiming a city
violated her statutory rights when it altered her pension benefits. Id. at 369–
70. The court explained that an ultra vires lawsuit aimed at “requir[ing] state
officials to comply with [a] statut[e] . . . [is] not prohibited by sovereign
immunity.” Id. at 372. Such lawsuits, however, must be brought against state
actors in their official capacity and not the state itself, even though the claims
are effectively against the state. Id. at 372–73. Ultra vires lawsuits also must
“allege, and ultimately prove, that [such state officials] acted without legal
authority or failed to perform a purely ministerial act.” Id. at 372. The court
allowed the widow to pursue her claims for prospective relief against the state
officials pursuant to the ultra vires exception but dismissed her claims for
retrospective monetary relief and her claims against the city and other
governmental entities. Id. at 369, 379–80.
Here, Stem has filed suit against the City of Hearne and the mayor in
his individual and official capacity for trampling on Stem’s rights guaranteed
by Section 614.023. Under Heinrich, sovereign immunity insulates the city
from the lawsuit. Id. at 379–80. The district court properly dismissed that
claim. Stem’s claim against the mayor in his official capacity does fall under
the ultra vires exception, and is not initially barred. Id. at 372–73.
Despite clearing the hurdle related to sovereign immunity, Stem’s claim
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against the mayor in his official capacity was nonetheless properly dismissed.
Section 614.023(c) expressly provides that a covered individual “may not be
indefinitely . . . terminated from employment based on the subject matter of
the complaint unless . . . the complaint is investigated[,] and . . . there is
evidence to prove the allegation of misconduct.” Therefore, the proper
defendants are the city officials who had the power to terminate Stem’s
employment, actually did terminate his employment, and now have the power
to reinstate him.
Stem alleges in his complaint that the mayor recommended his dismissal
and that the Hearne City Council acted on that recommendation. Yet, the only
official capacity claim Stem brought was against the mayor. The complaint
does not assert that the mayor has a statutory role in City Council meetings,
claim the mayor actually cast a vote to dismiss Stem, or recount the final tally
among those who did vote. Stem explains in his brief that “[t]he mayor called
the meeting, set the agenda, and presided over the meeting where he and the
Council voted to terminate” him. The Supreme Court has said that a court
may draw reasonable inferences in determining “facial plausibility” for
purposes of a Rule 12(b)(6) motion. Iqbal, 556 U.S. at 678. Without more
details, though, the only reasonable inference that can be drawn from the
complaint is that the mayor simply recommended dismissal. Thus, Stem failed
to state a claim against the mayor in his official capacity. The district court
properly dismissed his claim.
The district court also stated that “Chapter 614 is inapplicable to
[Stem’s] separation.” As previously discussed, we do not find it necessary to
determine the statute’s applicability. Texas courts have not resolved
important questions about Section 614.023, such as the kind of complaint and
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complainant that activate the procedural safeguards in the statute. 3 Section
614.023 applies to a broad array of law enforcement officers and others. See
Tex. Gov’t Code Ann. § 614.001(3). Therefore, any interpretation of Section
614.023 could have a far-reaching impact on governmental entities’ internal
operations and the way community members interact with their police, fire
safety, and other peace-keeping personnel. We have held that Stem’s claim for
declaratory relief against the city and mayor in his official capacity fail for
other reasons. Principles of federalism and comity must be considered as to
every aspect of a suit, and “judicial economy, convenience, fairness, and
comity” require us to avoid unnecessarily deciding novel and significant
matters of state law. See Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350
(1988). One clear benefit of pretermitting such issues is that before they again
present themselves in federal court, a clear answer from Texas precedent may
be available.
IV. Motion for Leave to Amend
Stem moved for leave to amend his complaint as to his state-law
declaratory judgment claim. Leave to amend should be “freely give[n] . . . when
justice so requires.” FED. R. CIV. P. 15(a)(2). A court must have a “‘substantial
reason’ to deny a party’s request for leave to amend.” Marucci Sports, L.L.C.
v. Nat’l Collegiate Athletic Ass’n, 751 F.3d 368, 378 (5th Cir. 2014) (quoting
Jones v. Robinson Prop. Grp., L.P., 427 F.3d 987, 994 (5th Cir. 2005)).
3See Guthery v. Taylor, 112 S.W.3d 715, 721–23 (Tex. App.—Houston [14th Dist.]
2003, no pet.) (holding that a complainant is any “person claiming to be the victim of
misconduct by a[n] . . . officer” by referencing Local Government Code Section 143.123);
Treadway v. Holder, 309 S.W.3d 780, 784 (Tex. App.—Austin 2010, pet. denied) (holding 2–1
that a “complaint” includes internal complaints by an agency head); City of Houston v.
Wilburn, 445 S.W.3d 361, 365 (Tex. App.—Houston [1st Dist.] 2013, no pet.) (avoiding the
“question of whether Chapter 614 requires a signed complaint in all circumstances resulting
in disciplinary action against employees under its purview”).
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“[F]ailure to provide an adequate explanation to support . . . denial of leave”
may be grounds for reversal. Marucci Sports, 751 F.3d at 378 (quotation marks
omitted). When an amended complaint would still “fail to survive a Rule
12(b)(6) motion,” it is not an abuse of discretion to deny the motion. Id.
When requesting leave to amend, Stem specifically provided that his
amended complaint would (1) plead that Section 614.023 has been adopted by
the city, (2) plead that the city had followed the mandates of Section 614.023
in the past, (3) name each councilmember who voted to terminate his
employment and/or the police chief as defendants, and (4) request prospective
relief. The district court failed to address Stem’s request in its opinion
dismissing the lawsuit, judgment denying all outstanding motions, and opinion
in response to Stem’s motion for reconsideration.
The first and second proposed amendments, which might correct
pleading deficiencies related to Stem’s Section 1983 claim, would have been
futile. We have held that Section 614.023 creates no property interest in
employment. Therefore, Stem cannot plead that he was deprived of a
constitutional right. Denying an amendment to the Section 1983 claim was
not error. Stem’s third and fourth proposals, though, would have cured
previously discussed deficiencies in Stem’s complaint related to his state-law
claim for declaratory relief. The amendment would not have been futile.
We find that in this situation, the “failure to provide an adequate
explanation to support” the denial of leave to amend is grounds for reversal.
Marucci, 751 F.3d at 378. There may have been unarticulated but valid
reasons, such as that the amendment would have merely corrected the
pleading of a state-law claim after the dismissal of all federal claims. Courts
are to consider “judicial economy, convenience, fairness, and comity,” and
specifically whether it “has dismissed all claims over which it has original
jurisdiction,” when deciding whether to exercise supplemental jurisdiction. See
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Carnegie-Mellon, 484 U.S. at 350; 28 U.S.C. § 1367(c). Because the decision is
to be made at the discretion of the district court, we remand for an explanation
of the discretion’s exercise.
***
We REVERSE the district court’s denial of Stem’s motion for leave to
amend his complaint, and REMAND. We REVERSE the district court’s
dismissal for lack of jurisdiction. We otherwise AFFIRM.
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