202 F.3d 676 (4th Cir. 2000), 98-2696(CA-95-248-2, Suarez Corp. Indus. v. McGraw

Docket Nº:98-2696(CA-95-248-2).
Citation:202 F.3d 676
Party Name:SUAREZ CORPORATION INDUSTRIES; EMERSON SONNY CLOPPER; PATRICIA CLOPPER; ELIZABETH PISHNER, Plaintiffs-Appellees, v. DARRELL V. MCGRAW, JR., Attorney General of the State of West Virginia, in his official capacity; THOMAS RODD, individually, Defendants-Appellants, and JOHN DOE, I-III, individually, Defendants, THOMAS TINDER, Party in Interest.
Case Date:February 02, 2000
Court:United States Courts of Appeals, Court of Appeals for the Fourth Circuit

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202 F.3d 676 (4th Cir. 2000)



DARRELL V. MCGRAW, JR., Attorney General of the State of West Virginia, in his official capacity; THOMAS RODD, individually, Defendants-Appellants, and JOHN DOE, I-III, individually, Defendants, THOMAS TINDER, Party in Interest.

No. 98-2696(CA-95-248-2).

United States Court of Appeals, Fourth Circuit

February 2, 2000

        Argued: October 26, 1999.

        Appeal from the United States District Court for the Southern District of West Virginia, at Charleston.

        Charles H. Haden II, Chief District Judge.

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[Copyrighted Material Omitted]

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        COUNSEL ARGUED: Rebecca Ann Baitty, REBECCA A. BAITTY, P.A., Sarasota, Florida, for Appellants. C. Allen Foster, PATTON BOGGS, L.L.P., Washington, D.C., for Appellees. ON BRIEF: Rudolph L. DiTrapano, DITRAPANO, BARRETT & DIPIERO, Charleston, West Virginia, for Appellant McGraw; Robert F. Cohen, Jr., COHEN, ABATE & COHEN, L.C., Fairmont, West Virginia, for Appellant Rodd. Eric C. Rowe, PATTON BOGGS, L.L.P., Washington, D.C.; Herbert L. Hively, II, Hurricane, West Virginia, for Appellees.

        Before LUTTIG and MOTZ, Circuit Judges, and HAMILTON, Senior Circuit Judge.

        Vacated and remanded by published opinion. Senior Judge Hamilton wrote the opinion, in which Judge Luttig and Judge Motz joined.


         HAMILTON, Senior Circuit Judge:

        Darrell V. McGraw (McGraw), the Attorney General of West Virginia, and Thomas Rodd (Rodd), a former West Virginia Deputy Attorney General, appeal

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from that portion of a district court order that denied their motion for summary judgment on the 42 U.S.C. § 1983 claim asserted by Suarez Corporation Industries (SCI) alleging that McGraw and Rodd retaliated against SCI for exercising its First Amendment right to free speech. McGraw and Rodd contend that the district court erred in denying them summary judgment on this claim because they are entitled to qualified immunity. We agree. Accordingly, we vacate that portion of the district court's order appealed from and remand for further proceedings consistent with this opinion.


        SCI, an Ohio corporation, markets a variety of consumer goods, under various trade names, through direct mail marketing that invites potential customers to participate in sweepstakes or other promotions. Prior to September 1994, SCI, under the trade name Lindenwold Fine Jewelers (Lindenwold), conducted business in West Virginia by soliciting mail orders for its products. Three of these solicitations are relevant to this case: (1) a "free" 1-carat Lindenwold cubic zirconium diamond simulant, already set in a mounting, for which the consumer must pay $19 for the mounting and an enhanced opportunity to win $10,000 (the CZ solicitation); (2) a cash prize of"as much as" $1000 contained in a clutch purse ensemble, for which the consumer must pay $12, plus $2 shipping and handling (the clutch purse solicitation); and (3) leaded crystal candlesticks, for which the consumer must pay $19 in order to receive the candlesticks, a free glass heart-shaped dish, and an enhanced opportunity to win a $1000 cash prize (the candlesticks solicitation).

        The CZ solicitation notified consumers that they had won a 1-carat Lindenwold cubic zirconium diamond simulant, and further that they were eligible to win an additional $10,000 prize. The "free" cubic zirconium diamond simulant, however, was already mounted in a ring or necklace that consumers could purchase for $19. The solicitation informed consumers that their opportunity for winning the $10,000 was enhanced if the mounting was purchased. If consumers only wanted the "free" simulant, they had to affix a label from one form to another form, handwrite a "code number" on the new form, then fill out a release form, and return it to SCI in a #10 white envelope. Failure to properly follow these procedures resulted in the forfeiture of the simulant and eligibility to win the $10,000. If consumers were willing to pay the $19 for the mounting, to claim their simulant and be eligible for the enhanced prize, they only needed to complete a simple form and return it to SCI in a self-addressed envelope. Anytime consumers attempted to claim just the simulant, SCI would send a follow-up solicitation informing them that unless they purchased the mounting, their file would be closed. The language of the follow-up solicitation intimated that if a consumer's file was closed, the consumer would no longer be eligible for the $10,000 prize.

        The clutch purse solicitation notified consumers that they had won a cash prize of "as much as $1000." The cash prize was contained in a five piece clutch purse ensemble that consumers could purchase for $12, plus $2 for special packaging, shipping, and insurance. For 99.5% of the time, the cash prize was $1. Although consumers were informed that they need not purchase the ensemble to claim their prize, SCI claimed that because it would have to remove the prize from the purses, those who ordered the ensemble would receive priority handling. Moreover, to claim the cash prize without ordering the ensemble, consumers were required to: (1) cut out the prize confirmation bar code from the order form; (2) paste it onto a 3-1/2" x 5-1/2" index card furnished by the consumers; (3) write their name, address, and phone number on the index card; and (4) return it in a #10 white envelope. If the consumers failed to follow these procedures, they forfeited the cash prize. In

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contrast, consumers willing to purchase the ensemble simply had to complete an order form and return it in a selfaddressed envelope.

        Finally, the candlesticks solicitation offered consumers a pair of leaded crystal candlesticks for $19, plus a bonus glass heart-shaped dish at no additional cost. All consumers receiving the solicitation were eligible to win a $1000 cash prize, but purchasers of the candlesticks received priority handling and "immediate security processing." The text of the solicitation led consumers to believe that their chances of winning the $1000 were enhanced if they purchased the candlesticks. Consumers who did not want to purchase the candlesticks, but who wanted to remain eligible for the $1000, were required to print their name, address, and customer number onto a 3-1/2" x 5-1/2" index card and return it, along with the envelope provided by SCI for those who did choose to purchase the candlesticks, in a second envelope.

        Based on solicitations analogous to SCI's, in January 1994, the West Virginia Attorney General's office (the AG's office) initiated an action in the Circuit Court of Kanawha County, West Virginia, against four direct marketing companies alleging violations of the state's Consumer Credit and Protection Act, W.Va. Code §§ 46A-1101 to -8-102 (1998), and the Prizes and Gifts Act, id. §§ 46A-6D-1 to -10.1 In August 1994, the AG's office moved to join 102 additional defendants, including SCI. At the same time, the AG's office applied for a preliminary injunction against all of the defendants. The state circuit judge granted the motion to join the additional defendants but instructed the AG's office to select a representative number of defendants against whom it wished to proceed. Thereafter, the AG's office notified the state circuit court that it would proceed only against SCI.2

        Following the initiation of the state court litigation, SCI and the AG's office had a number of less than congenial confrontations. SCI claims that, in August 1994 it met with Rodd, who was then the West Virginia Deputy Attorney General assigned to the Consumer Protection Division, about a possible settlement, but that Rodd responded by "launch[ing] into a tirade that was not factually substantive," and "calling Lindenwold a bunch of crooks." (J.A. 113). Rodd allegedly stated that it would "become his mission to `cause as much pain, damage and injury as possible to SCI,'" unless SCI voluntarily withdrew its direct marketing business from the State of West Virginia. Id. Rodd testified in a deposition that he gave SCI the choice of "[a]gree[ing] to a temporary injunction or [the AG's office would] go forward and seek to inflict the maximum degree of penalty."3 (J.A. 84 n.7). SCI's response to this meeting was to file a complaint with the Better Government Bureau (BGB), which in turn filed a Freedom of Information Act request with the AG's office.4

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        In late August 1994, a number of newspaper articles were published in which members of the AG's office accused SCI/Lindenwold of cheating West Virginia residents out of their money. There is also an indication that, at approximately the same time these articles were published, the AG's office had received information from the Washington State Attorney General's Office that SCI's modus operandi for fighting state investigations was to engage in an extensive media campaign criticizing public officials. Based on this information, the West Virginia Managing Deputy Attorney General, Fran Hughes, informed both McGraw and Rodd about her concerns with respect to the beginnings of an SCI media campaign.

        On September 2, 1994, SCI published a two-page ad in The Charleston Gazette newspaper. The ad was in the form of a letter from Lindenwold employees to McGraw and Rodd, which read, in part, "DO NOT PLAY POLITICS WITH OUR LIVELIHOOD OR THE RIGHTS OF OUR 20,000 SATISFIED CUSTOMERS IN THE STATE OF WEST VIRGINIA." (SCI's Response to Motion for Summary Judgment Exhibit A-1). The employees proceeded to criticize McGraw for his prosecution of the lawsuit against SCI and demanded "to know why [McGraw and Rodd] are wasting taxpayer's dollars when we have...

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