Wabakken v. California Department of Corrections & Rehabilitation

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
DAVID WABAKKEN, No. 13-56075
Plaintiff-Appellant,
D.C. No.
v. 2:12-cv-01503-
GW-DTB
CALIFORNIA DEPARTMENT OF
CORRECTIONS AND
REHABILITATION; J. W. MORGAN; OPINION
GEORGE DIMAGGIO; GARY GROVER;
KEITH MAYFIELD; FRANK CHAVEZ;
FRANK MARTINEZ,
Defendants-Appellees.
Appeal from the United States District Court
for the Central District of California
George H. Wu, District Judge, Presiding
Argued and Submitted
May 8, 2015—Pasadena, California
Filed September 14, 2015
Before: Harry Pregerson, Richard C. Tallman,
and Jacqueline H. Nguyen, Circuit Judges.
Opinion by Judge Pregerson
2 WABAKKEN V. CAL. DEP’T OF CORR. & REHAB.
SUMMARY*
Collateral Estoppel
The panel reversed the district court’s summary judgment
in favor of prison officials in an action brought by a former
employee of the California Department of Corrections and
Rehabilitation, alleging violations of 42 U.S.C § 1983 and
California’s Whistleblower Protection Act, and intentional
infliction of emotional distress.
The district court found that the plaintiff was collaterally
estopped from relitigating the whistleblower retaliation issue
because it had been litigated during State Personnel Board
proceedings.
The panel held that, pursuant to State Board of
Chiropractic Examiners v. Superior Court, 45 Cal. 4th 963,
976 (2009), the State Personnel Board’s decision did not have
preclusive effect under theories of res judicata and collateral
estoppel and thus did not prevent the plaintiff from litigating
his whistleblower retaliation damages claim in the district
court.
COUNSEL
Derek T. Anderson (argued), Attorney at Law, San Diego,
California, for Plaintiff-Appellant.
*
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
WABAKKEN V. CAL. DEP’T OF CORR. & REHAB. 3
Mark Schreiber (argued), Deputy Attorney General; Kamala
D. Harris, Attorney General; Alicia M. B. Fowler, Senior
Assistant Attorney General; Jerald L. Mosley, Supervising
Deputy Attorney General; and Patricia Nevonen, Deputy
Attorney General; California Department of Justice, Los
Angeles, California, for Defendants-Appellees.
OPINION
PREGERSON, Circuit Judge:
Appellant David Wabakken was a Lieutenant with the
California Department of Corrections and Rehabilitation
(“Corrections Department”). Between August 2010 and April
2011, the Corrections Department sent Wabakken three
notices of adverse action, each of which contained multiple
charges of misconduct. The third notice of adverse action
resulted in Wabakken’s dismissal from employment with the
Corrections Department. Wabakken appealed the three
adverse actions to the California State Personnel Board.
The Administrative Law Judge (“ALJ”) determined that
the Corrections Department failed to establish by a
preponderance of the evidence the charges against Wabakken
in the first and second notices of adverse action. The ALJ also
determined that the Corrections Department had proved by a
preponderance of the evidence some of the less serious
charges of misconduct alleged in the third notice of adverse
action, but that dismissal from employment was too harsh a
penalty. The State Personnel Board adopted the ALJ’s
decision.
4 WABAKKEN V. CAL. DEP’T OF CORR. & REHAB.
Wabakken filed suit in the United States District Court
against the Corrections Department, J.W. Morgan, George
DiMaggio, Gary Grover, Keith Mayfield, Frank Chavez,
Frank Martinez, and Does 1–10 (“Defendants”) alleging
violations of both 42 U.S.C. § 1983 and California
Government Code § 8547 (known as the California
Whistleblower Protection Act) and intentional infliction of
emotional distress. Defendants moved for summary
judgment, arguing that the State Personnel Board’s decision
precluded further litigation of these issues under collateral
estoppel.
The district court granted the Defendants’ motion for
summary judgment finding Wabakken was collaterally
estopped from relitigating the whistleblower retaliation issue
because it had been litigated during the State Personnel Board
proceedings. We reverse because, pursuant to State Board of
Chiropractic Examiners v. Superior Court, 45 Cal. 4th 963,
976 (2009), the State Personnel Board’s decision does not
have preclusive effect under theories of res judicata and
collateral estoppel and thus does not prevent Wabakken from
litigating his whistleblower retaliation damages claim in the
district court.
BACKGROUND
Appellant David Wabakken started working for the
Corrections Department around September 1995. Wabakken
was promoted to Correctional Sergeant in 2000 and
Correctional Lieutenant in 2004. In June 2007, Wabakken
was transferred to Pilot Rock Conservation Camp. Pilot Rock
is a Corrections Department camp where the inmates “have
less direct supervision and more freedom than inmates housed
at institutions.”
WABAKKEN V. CAL. DEP’T OF CORR. & REHAB. 5
Between June 18, 2007, and May 6, 2011, Wabakken
disclosed alleged improper governmental activities to his
superiors including the following: negligent supervision of
inmates resulting in the temporary escape of one inmate;
exhibiting a movie to inmates that violated the Corrections
Department policy; attempts to collect overtime for work not
done; and allowing contraband into the camp. During the
period that Wabakken made these disclosures, he received
three notices of adverse action.
On August 5, 2010, Wabakken received his first notice of
adverse action. This notice alleged that Wabakken had
discussed the contents of an interview regarding another
Correctional Officer’s misconduct with the officer under
investigation, in violation of the interviewer’s instructions.
Wabakken received a 5% reduction in salary for 36 months
and was transferred to another Corrections Department
facility.
On April 6, 2011, Wabakken received his second notice
of adverse action. The second notice alleged that he
“repeatedly made racially derogatory comments about staff,
inmates, and others[;] . . . repeatedly made derogatory
comments about an employee’s age;” and dishonestly denied
these allegations. As a result, Wabakken was demoted from
Correctional Lieutenant to Correctional Officer.
On April 22, 2011, Wabakken received his third and final
notice of adverse action. The third notice accused Wabakken
of the following: transporting inmates to family residences to
retrieve items; using an unauthorized carpet cleaner at Pilot
Rock; encouraging an inmate to place his penis through a
PVC pipe; falsifying an inmate violation report; exposing his
buttocks to inmates; using Corrections Department equipment
6 WABAKKEN V. CAL. DEP’T OF CORR. & REHAB.
for personal purposes; bringing an inappropriate DVD to Pilot
Rock and showing it to inmates; falsifying a report about a
Correctional Officer’s conduct; making inappropriate racial
and sexual comments to inmates and staff; and dishonestly
denying this conduct. The third notice of adverse action
resulted in his dismissal from service with the Corrections
Department on May 6, 2011.
The California State Personnel Board reviews disciplinary
actions taken against state employees. State Pers. Bd. v. Dep’t
of Pers. Admin., 37 Cal. 4th 512, 521 (2005). Wabakken
appealed the three adverse actions to the State Personnel
Board and the Board consolidated the three matters for
hearing. Wabakken raised multiple affirmative defenses to
the charges that formed the basis for his discipline. The
affirmative defense relevant to this appeal is Wabakken’s
defense that the adverse actions taken against him by the
Corrections Department constituted “retaliation for testifying
against [the Corrections Department’s] witnesses.” California
Government Code § 8547.8(e) provides that an employee can
use whistleblower retaliation as “a complete affirmative
defense.”
Section 8547.8(a) allows employees to use whistleblower
retaliation as a legal sword to file complaints against
employers. In September 2011, Wabakken filed a
whistleblower retaliation complaint with the State Personnel
Board alleging that the Defendants retaliated against him
after he made protected disclosures of their improper
government activities. Wabakken sought damages and
requested the State Personnel Board to take disciplinary
action against the Defendants. On October 20, 2011, the State
Personnel Board dismissed Wabakken’s whistleblower
retaliation complaint after determining that he had failed to
WABAKKEN V. CAL. DEP’T OF CORR. & REHAB. 7
demonstrate that the adverse actions taken against him by the
Corrections Department were in retaliation for his protected
disclosures. See Cohen v. Fred Meyer, Inc., 686 F.2d 793,
796 (9th Cir. 1982) (a prima facie case of retaliation requires
a showing that “a causal link exists between” the protected
disclosures and the adverse employment action).
During the pre-hearing conference regarding Wabakken’s
appeal of the Corrections Department’s disciplinary actions,
the Corrections Department attempted to bar Wabakken from
presenting whistleblower retaliation as an affirmative
defense. The ALJ denied the Corrections Department’s
motion because even though Wabakken’s attempt to use
whistleblower retaliation as a sword had failed, that did not
preclude Wabakken “from asserting retaliation as an
affirmative defense to the charges at hearing.”
The merits hearing before the ALJ1 took place from June
4–8, and June 11–13, 2012. The ALJ issued a 49-page
decision. The ALJ determined that the Corrections
Department had failed to establish by a preponderance of the
evidence the charges against Wabakken in the first and
second notices of adverse action. However, the ALJ
determined that the Corrections Department had proved by a
preponderance of the evidence some of the less serious
charges of misconduct alleged in the third notice of adverse
1
Two different ALJs presided over Wabakken’s case. ALJ Douglas A.
Purdy presided over the hearing on the merits and rendered the decision,
while ALJ Gregory W. Brown presided over the pre-hearing conference.
8 WABAKKEN V. CAL. DEP’T OF CORR. & REHAB.
action, but that his dismissal was too harsh a penalty.2 The
ALJ found that a salary reduction for one year was the
appropriate penalty.
The ALJ also explicitly addressed three of Wabakken’s
affirmative defenses, but did not address his whistleblower
retaliation defense. The State Personnel Board adopted and
accepted the ALJ’s decision.
On September 7, 2012, in the United States District Court
Wabakken filed a second amended complaint against the
Corrections Department, the warden at Pilot Rock, and
several other correctional officers. His second amended
complaint alleged violation of the Whistleblower Protection
Act (Cal. Gov’t. Code § 8547), intentional infliction of
emotional distress, and violation of 42 U.S.C. § 1983.3 The
Defendants moved for summary judgment arguing that the
State Personnel Board decision precluded further litigation of
these issues under res judicata (claim preclusion) and
collateral estoppel (issue preclusion). The district court
rejected Defendants’ res judicata argument. The Defendants
2
The ALJ found that the Corrections Department had proved by a
preponderance of the evidence that Wabakken participated in the
following misconduct, and thus that there was cause for at least some of
his discipline: used a state vehicle and state camera for personal purposes
while on duty; posed for an inappropriate photo while in an office at Pilot
Rock; and brought a DVD to Pilot Rock for training purposes that had not
been approved.
3
Each of these claims was based on the Defendants’ alleged retaliation
against Wabakken for disclosing improper government activities. The
court granted Defendants’ motion to dismiss the fourth claim for relief
during the pleading stage.
WABAKKEN V. CAL. DEP’T OF CORR. & REHAB. 9
do not challenge the district court’s decision on the res
judicata issue.
The district court, however, applied collateral estoppel
and concluded that whether adverse employment action was
taken against Wabakken as a result of whistleblower
retaliation had been litigated and decided against Wabakken
during the State Personnel Board proceedings. The district
court reasoned that the whistleblower retaliation issue before
it was identical to the issue considered by the State Personnel
Board. In addition, the district court determined that the issue
was actually litigated because Wabakken raised
whistleblower retaliation as an affirmative defense and
submitted evidence to support this defense. Further, the
district court found that the ALJ necessarily decided the
whistleblower retaliation issue against Wabakken because the
ALJ applied the preponderance of the evidence standard
which is consistent with a rejection of the retaliation defense.
Under California Government Code § 8547.8(e), the
initial burden of going forward with the evidence rests with
the employee. The employee must produce evidence
sufficient to support a finding based on the preponderance
standard that whistleblower retaliation occurred. If the
employee meets this initial burden, then the burden shifts to
the employer to prove by clear and convincing evidence that
retaliation was not the reason for the adverse employment
action. Cal. Gov’t Code § 8547.8(e). Because the ALJ
employed the preponderance standard when considering
whether the adverse employment actions were warranted, and
not the clear and convincing standard, the district court
determined that the ALJ had implicitly decided the
whistleblower retaliation issue against Wabakken because he
had failed to meet his initial burden of showing under the
10 WABAKKEN V. CAL. DEP’T OF CORR. & REHAB.
preponderance standard evidence sufficient to support a
finding that whistleblower retaliation occurred.
In short, the district court reasoned that because the ALJ
failed to apply the clear and convincing standard, the ALJ
implicitly “never found sufficient credence in [Wabakken’s]
retaliation-based affirmative defense.” For these reasons, the
district court granted the Defendants’ motion for summary
judgment. Wabakken timely appealed.
STANDARD OF REVIEW
The Ninth Circuit reviews a district court’s grant of
summary judgment de novo. Travelers Cas. & Sur. Co. of
Am. v. Brenneke, 551 F.3d 1132, 1137 (9th Cir. 2009).
Summary judgment should be granted “if the pleadings, the
discovery and disclosure materials on file, and any affidavits
show that there is no genuine issue as to any material fact and
that the movant is entitled to judgment as a matter of law.” Id.
(internal quotation mark omitted) (citing Fed. R. Civ. P.
56(c)). Wabakken conceded before the district court, and
again before us in his reply brief, that he raised retaliation as
an affirmative defense before the State Personnel Board, so
there was no genuine dispute as to any material fact. Whether
the Defendants were entitled to judgment as a matter of law
is all that is in dispute.
Whether collateral estoppel bars a party’s claims “is a
mixed question of law and fact in which legal issues
predominate.” United States v. Geophysical Corp. of Alaska,
732 F.2d 693, 697 (9th Cir. 1984). Thus, whether or not
collateral estoppel applies is reviewed de novo. Id. “If
collateral estoppel is available, this court reviews the district
court’s decision giving preclusive effect to the determination
WABAKKEN V. CAL. DEP’T OF CORR. & REHAB. 11
of the municipal hearing officer for abuse of discretion.”
Eilrich v. Remas, 839 F.2d 630, 632 (9th Cir. 1988).
DISCUSSION
The doctrine of collateral estoppel, or issue preclusion, is
“grounded on the premise that ‘once an issue has been
resolved in a prior proceeding, there is no further fact-finding
function to be performed.’” Murray v. Alaska Airlines, Inc.,
50 Cal. 4th 860, 864 (2010) (quoting Parklane Hosiery Co. v.
Shore, 439 U.S. 322, 336 n.23 (1979)). Collateral estoppel
both “protect[s] litigants from the burden of relitigating an
identical issue with the same party or his privy and . . .
promot[es] judicial economy, by preventing needless
litigation.” Id. (quoting Parklane Hosiery Co., 439 U.S. at
326).
Collateral estoppel bars “relitigation of an issue decided
at a previous proceeding if (1) the issue necessarily decided
at the previous [proceeding] is identical to the one which is
sought to be relitigated; (2) the previous [proceeding] resulted
in a final judgment on the merits; and (3) the party against
whom collateral estoppel is asserted was a party or in privity
with a party at the prior [proceeding].” People v. Carter,
36 Cal. 4th 1215, 1240 (2005) (alterations in original)
(internal quotation marks omitted). “[O]nly issues actually
litigated in the initial action may be precluded from the
second proceeding under the collateral estoppel doctrine.” Id.
(citation omitted). “An issue is actually litigated [w]hen [it]
is properly raised, by the pleadings or otherwise, and is
submitted for determination, and is determined.” Id. (quoting
People v. Sims, 32 Cal. 3d 468, 484 (1982)) (internal
quotation marks omitted).
12 WABAKKEN V. CAL. DEP’T OF CORR. & REHAB.
Significantly, under California Supreme Court precedent,
“a court may not give preclusive effect to the decision in a
prior proceeding if doing so is contrary to the intent of the
legislative body that established the proceeding in which res
judicata or collateral estoppel is urged.” State Bd. of
Chiropractic Exam’rs v. Superior Court, 45 Cal. 4th 963, 976
(2009) (citations omitted). We find that Wabakken should not
have been collaterally estopped from pursuing his
whistleblower retaliation claim in district court.
In State Board of Chiropractic Examiners, a case with a
similar procedural history, the California Supreme Court held
that “the Legislature did not intend the State Personnel
Board’s findings [in a whistleblower retaliation case] to have
a preclusive effect against the complaining employee.” Id.
When the Legislature drafted the California Whistleblower
Protection Act it “expressly authorized a damages action in
superior court for whistleblower retaliation (§ 8547.8(c)), and
in doing so it expressly acknowledged the existence of the
parallel administrative remedy” with the State Personnel
Board. Id. As a prerequisite to the damages action authorized
in § 8547.8(c), the Whistleblower Protection Act requires the
filing of a complaint with the State Personnel Board. See Cal.
Gov’t Code § 8547.8(c) (“[A]ny action for damages shall not
be available to the injured party unless the injured party has
first filed a complaint with the State Personnel Board
pursuant to subdivision (a), and the board has issued, or failed
to issue, findings pursuant to Section 19683.”).
The employee in State Board of Chiropractic Examiners
filed a complaint alleging whistleblower retaliation with the
State Personnel Board. 45 Cal. 4th at 969. After conducting
an investigation the State Personnel Board’s executive officer
issued a 16-page “Notice of Findings” recommending
WABAKKEN V. CAL. DEP’T OF CORR. & REHAB. 13
dismissal of the complaint. Id. Then the employee brought
suit in state court under the same whistleblower retaliation
theory. Id. at 970. The California Supreme Court held she
was not precluded from bringing this claim in court, even
though the State Personnel Board decision was not in her
favor. Id. at 978.
The California Supreme Court held that § 8547.8(c)
“means what it says: An employee complaining of
whistleblower retaliation may bring an action for damages in
superior court, but only after the employee files a complaint
with the State Personnel Board and the board ‘has issued, or
failed to issue, findings.’” Id. (quoting § 8547.8(c)) (emphasis
omitted). Thus, once the State Personnel Board has issued
findings, or failed to do so, “the employee may proceed with
a damages action in superior court regardless of whether the
[State Personnel Board’s] findings are favorable or
unfavorable to the employee.” Id.
“When interpreting state law, federal courts are bound by
decisions of the state’s highest court.” In re Bartoni-Corsi
Produce, Inc., 130 F.3d 857, 861 (9th Cir. 1997) (quoting
Lewis v. Tel. Emps. Credit Union, 87 F.3d 1537, 1545 (9th
Cir. 1996)). Thus, the California Supreme Court’s
interpretation of § 8547.8 is binding.
Here, Wabakken filed a complaint with the State
Personnel Board alleging whistleblower retaliation, and the
complaint was dismissed by a State Personnel Board
executive officer. Thus, after filing his complaint with the
State Personnel Board and receiving an unfavorable
dismissal, Wabakken was eligible to seek relief in court under
§ 8547.8(c).
14 WABAKKEN V. CAL. DEP’T OF CORR. & REHAB.
Around the same time that Wabakken filed the
whistleblower retaliation complaint with the State Personnel
Board, he filed a claim challenging the disciplinary actions
taken against him by the Corrections Department. The ALJ
also held a merits hearing on whether the Corrections
Department’s discipline of Wabakken was warranted.
Wabakken raised whistleblower retaliation as an affirmative
defense to the disciplinary actions taken against him by the
Corrections Department. The ALJ’s decision upholding some
of the discipline was adopted by the State Personnel Board.
State Board of Chiropractic Examiners explains that
§ 8547.8(c) explicitly reserves a whistleblower retaliation
cause of action in a court for employees. Thus, the decisions
by the State Personnel Board in Wabakken’s case similarly
have no preclusive effect. Even if the State Personnel Board’s
merits decisions were unfavorable to Wabakken,4 they do not
prevent Wabakken from seeking relief on his retaliation claim
in court. See id. at 977 (“[T]he . . . conclusion that the State
Personnel Board’s findings are binding in a court action for
damages under Government Code section 8547.8(c) would
unduly restrict that remedy.”).
CONCLUSION
California Government Code § 8547, California’s
Whistleblower Protection Act, as interpreted by the California
Supreme Court, provides employees with the ability to file
4
We do not reach the issue whether the State Personnel Board decision
rejected Wabakken’s whistleblower retaliation affirmative defense
because even if it did, Wabakken still is not precluded from bringing a
whistleblower claim in court. See State Bd. of Chiropractic Examiners,
45 Cal. 4th at 978 (“[T]he employee may proceed with a damages action
in superior court regardless of whether the [State Personnel Board’s]
findings are favorable or unfavorable to the employee.”).
WABAKKEN V. CAL. DEP’T OF CORR. & REHAB. 15
whistleblower retaliation claims in court after filing a
complaint with the State Personnel Board, regardless of the
favorability of the State Personnel Board’s decision to the
employee. Thus, State Personnel Board decisions do not have
preclusive effect and the district court erred in granting the
Defendants’ summary judgment motion.
REVERSED AND REMANDED.