73 F.3d 1365 (5th Cir. 1996), 94-50702, Vander Zee v. Reno

Docket Nº:94-50702.
Citation:73 F.3d 1365
Party Name:Harlan D. VANDER ZEE, Plaintiff-Appellant, v. Janet RENO, Attorney General, The Honorable Attorney General of the United States, et al., Defendants, United States of America, et al., Defendants-Appellees.
Case Date:February 02, 1996
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit

Page 1365

73 F.3d 1365 (5th Cir. 1996)

Harlan D. VANDER ZEE, Plaintiff-Appellant,


Janet RENO, Attorney General, The Honorable Attorney General

of the United States, et al., Defendants,

United States of America, et al., Defendants-Appellees.

No. 94-50702.

United States Court of Appeals, Fifth Circuit

February 2, 1996

Page 1366

Walter T. Charlton, Arlington, VA, Kathleen McCulloch, Odessa, TX, for appellant.

Sean A. Lev, Mark Stern, Jacob M. Lewis, Barbara L. Herwig, Asst. Director, Dept. of Justice, Washington, DC, Rick Strange, Midland, TX, for U.S., et al.

Appeal from the United States District Court for the Western District of Texas.

Before GARWOOD, DUHE and PARKER, Circuit Judges.

GARWOOD, Circuit Judge:

Plaintiff-appellant Harlan D. Vander Zee (Vander Zee) appeals the district court's dismissal of his Bivens action against federal prosecutors and claims for declaratory and injunctive relief against the United States based upon alleged violations of due process arising from a settlement agreement entered into between the Department of Justice and his former employer. We affirm.

Facts and Proceedings Below

Vander Zee was formerly employed as an executive vice-president at Stone Oak National Bank (Stone Oak) in San Antonio, Texas. During his tenure at Stone Oak, Vander Zee became aware of large cash deposits being made by Mario Alberto Salinas-Trevino (Salinas). After consulting with the bank's president, Herbert E. Pounds, Jr. (Pounds), Vander Zee properly reported these deposits to federal authorities and apparently continued to do so throughout the period in question.

In March 1989, Salinas was indicted and arrested on drug trafficking charges, although he subsequently escaped from custody. On May 10, 1990, the United States Attorney obtained a superseding indictment naming Pounds and Vander Zee, which alleged violations of federal money laundering statutes relating to the handling of the Salinas deposits. After his indictment, Vander Zee tendered his resignation to Stone Oak by letter dated May 22 pursuant to a formal resolution by the Board of Directors. Although the charges lodged against Pounds and Vander Zee proceeded to trial, the district court granted a Motion for Judgment of Acquittal by Vander Zee and Pounds at the close of the government's case-in-chief.

Page 1367

However, the government continued to pursue five related civil forfeiture actions against assets seized at the time of Salinas' arrest. Although Salinas' interest in these assets was defaulted at the time of his escape from custody, Stone Oak remained a party to the forfeiture actions by virtue of having filed a lienholder's claim. Among these assets were nine certificates of deposit held by Stone Oak with a principal face value of $850,000 that had been pledged as security for loans made by the bank. Stone Oak retained possession of the certificates of deposit pending the outcome of the litigation. Ultimately, these forfeiture actions were consolidated for purposes of settlement, and the government and Stone Oak entered into a "Stipulation and Settlement Agreement and Hold Harmless Agreement" (Agreement) and Addendum. The Agreement and Addendum provided that Stone Oak would retain the certificates of deposit to apply towards its recapitalization "in order to achieve and satisfy the capital and financial requirements as set forth by the Office of the Comptroller of the Currency (OCC) in order to remain and maintain itself as a viable, financial and banking institution in the community." In exchange, Stone Oak released any claim to the assets sought in the remaining forfeiture actions.

However, the Agreement and Addendum contained additional recitals and conditions which are relevant to the present action. Among these conditions was that

"Stone Oak National Bank in recognition of the allegations concerning the conduct of Herbert E. Pounds, Jr. and Harlan D. Vanderzee [sic], as set forth in the verified complaint for forfeiture in United States v. U.S. Currency Including Nine (9) Certificates of Deposit, et al, SA-90-CA-113, agrees to provide no further attorney fees nor other forms of financial assistance to Herbert E. Pounds, Jr. and Harlan D. Vanderzee [sic] except for such within the normal and usual course of any other banking customer's business, or unless the Bank becomes legally obligated to do so."

The Agreement contained additional recitals impugning the conduct of Pounds and Vander Zee. 1 The Addendum further required Stone Oak to provide "assurances in writing that Stone Oak National Bank shall not rehire Herbert E. Pounds, Jr., or Harlan D. Vander Zee [sic] in any capacity, because of the poor judgment they exercised in dealing with Mario Salinas." The Agreement and Addendum were expressly made contingent upon approval by the district court, which was obtained, and an order accepting the settlement was entered by the district court on August 14, 1992.

On August 13, 1993, Vander Zee filed this suit against a host of governmental and private defendants. However, we are now concerned only with Vander Zee's claims against the federal officials sued in their individual capacities and certain claims against the United States as these claims presently before us on this appeal were dismissed and severed from the original action. 2 The individual defendants to the claims now before us are former Assistant Attorney General Robert S. Mueller, III, former United States

Page 1368

Attorney Ronald Ederer, former Assistant United States Attorney Jack C. Frels, and United States Attorney Helen M. Eversberg. 3 Vander Zee brought Bivens actions against these individual defendants claiming that the recitals and conditions contained in the Agreement and Addendum operated to deprive him of protected liberty and property interests in violation of the Due Process Clause of the Fifth Amendment. Vander Zee also asserted state law tort claims against the individual defendants and the United States pursuant to the Federal Tort Claims Act (FTCA). Finally, Vander Zee asserted claims under the Administrative Procedure Act (APA) as well as seeking various forms of declaratory and injunctive relief against the United States.

The defendants filed motions to dismiss pursuant to Fed.R.Civ.P. 12(b)(1) and 12(b)(6), which were granted by the district court by order of June 6, 1994. The district court held that (1) Vander Zee's APA claims should be dismissed because the Agreement and Addendum were settlement decisions within the "exclusive discretion" of the Department of Justice, and therefore were not reviewable pursuant to Sec. 701(a)(2) of the APA; (2) the Bivens claims should be dismissed because Vander Zee failed to allege the violation of any constitutionally protected interest, or alternatively, the individual defendants were entitled to qualified immunity because the interests allegedly infringed were not "clearly established;" and (3) the FTCA claims should be dismissed for lack of subject matter jurisdiction because Vander Zee had failed to first present the claims to the Department of Justice as required by 28 U.S.C. Sec. 2675, and additionally because the claims for defamation and interference with contractual rights fell within the sovereign immunity reserved by Sec. 2680(h). 4 These claims, which are those now before us, were subsequently severed from the original action, and a final judgment was entered on August 26, 1994. 5


We review the district court's dismissal under Rules 12(b)(1) and 12(b)(6) de novo, taking the allegations of the complaint to be true. Carney v. Resolution Trust Corp., 19 F.3d 950, 954 (5th Cir.1994). The district court's dismissal will be affirmed only if it appears beyond doubt that the plaintiff can prove no set of facts which would entitle him to relief. Id.

I. Qualified Immunity

The qualified immunity defense affords government officials not just immunity from liability, but immunity from suit. Mitchell v. Forsyth, 472 U.S. 511, 525-26, 105 S.Ct. 2806, 2815, 86 L.Ed.2d 411 (1985). "Unless the plaintiff's allegations state a claim of violation of clearly established law, a defendant pleading qualified immunity is entitled to dismissal before the commencement of discovery." Id. (citing Harlow v. Fitzgerald, 457 U.S. 800, 817-19, 102 S.Ct. 2727, 2738, 73 L.Ed.2d 396 (1982)). Even limited discovery on the issue of qualified immunity "must not proceed until the district court first finds that the plaintiff's pleadings assert facts which, if true, would overcome the defense

Page 1369

of qualified immunity." Wicks v. Mississippi State Employment Serv., 41 F.3d 991, 994 & n. 10 (5th Cir.1995) (emphasis in original). However, "[a] necessary concomitant to the determination of whether the constitutional right asserted by a plaintiff is 'clearly established' at the time the defendant acted is the determination of whether the plaintiff has asserted a violation of a constitutional right at all." Siegert v. Gilley, 500 U.S. 226, 232, 111 S.Ct. 1789, 1793, 114 L.Ed.2d 277 (1991). We agree with the district court that Vander Zee failed to allege the violation of any constitutionally protected interest, at least not of any that was clearly established, and therefore, dismissal pursuant to Rule 12(b)(6) was proper.

Vander Zee alleges that in drafting the conditions of the Agreement and Addendum, the defendants acted to deprive him of various liberty and property interests in violation of the Due Process Clause of the Fifth Amendment. Specifically, Vander Zee urges that he was deprived of: (1) his liberty interest in future employment within the savings and loan industry; (2) his property interest in his employment with Stone Oak because the defendants both coerced his termination and...

To continue reading