859 F.2d 1543 (9th Cir. 1988), 87-3839, Brady v. Gebbie

Docket Nº:87-3839, 87-3877.
Citation:859 F.2d 1543
Party Name:William J. BRADY, M.D., Plaintiff-Appellee, Cross-Appellant, v. Kristine M. GEBBIE, Director, Human Resources, Administrator, Health Division of the State of Oregon, Defendant-Appellant, Cross-Appellee.
Case Date:October 31, 1988
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit
 
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Page 1543

859 F.2d 1543 (9th Cir. 1988)

William J. BRADY, M.D., Plaintiff-Appellee, Cross-Appellant,

v.

Kristine M. GEBBIE, Director, Human Resources,

Administrator, Health Division of the State of

Oregon, Defendant-Appellant, Cross-Appellee.

Nos. 87-3839, 87-3877.

United States Court of Appeals, Ninth Circuit

October 31, 1988

Argued and Submitted July 11, 1988.

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[Copyrighted Material Omitted]

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Michael D. Reynolds, Asst. Atty. Gen., Salem, Or., for defendant-appellant, cross-appellee.

Bernard Jolles, Jolles, Sokol & Bernstein, Portland, Or., for plaintiff-appellee, cross-appellant.

Appeal from the United States District Court for the District of Oregon.

Before GOODWIN, Chief Judge, ALARCON and FERGUSON, Circuit Judges.

FERGUSON, Circuit Judge:

Kristine M. Gebbie ("Gebbie") appeals from the district court order denying her motions for directed verdict and JNOV as to the liberty interest claim of William J. Brady, M.D. ("Brady"). Gebbie argues that the undisputed evidence shows that 1) Gebbie did not deprive Brady of a constitutionally protected liberty interest; 2) Brady received all the process he was due; and 3) Gebbie was protected by qualified immunity. Gebbie also appeals the denial of her motion for a new trial or remittitur on the grounds that the jury's award of damages was not supported by the evidence and was excessive and grossly disproportionate.

Brady cross-appeals from the district court's grant of a directed verdict for Gebbie on Brady's property interest claim. Brady argues that he had a constitutionally protected property interest in both his unclassified position as State Medical Examiner and his alleged right to return to classified service after termination of his unclassified job. He also appeals the district court's grant of partial summary judgment for Gebbie on the issue of his right to reinstatement. We affirm the decision of the district court on all of the issues.

I.

Brady, a board-certified hospital, clinical and forensic pathologist, was hired as Deputy Medical Examiner for the State of Oregon on January 1, 1969. In May, 1969, he became the State Medical Examiner. At that time, the position of State Medical Examiner was in the classified civil service. In January, 1977, the position was taken out of classified service and placed in management service; in September, 1977, the position was moved to the unclassified service.

From 1969 until January, 1979, Dr. Edward Press was Brady's supervisor. Dr. Press was succeeded by Gebbie, who remained Brady's supervisor until his discharge in October, 1985. At all times during his employment as State Medical Examiner, Brady received satisfactory or better evaluations from his supervisors. In addition to performing his official duties, Brady maintained a private practice, taught, and testified as an expert witness on numerous occasions.

On June 20, 1985, Brady was interviewed by a newspaper reporter who told him that she had information that he was selling body parts to finance parties in the morgue. After the interview, Brady called Gebbie and arranged to meet with her at her home that evening. At that meeting, Brady informed Gebbie about the interview. He also told her about a bank account which he had started while a county coroner and continued to keep after becoming State Medical Examiner. The unsolicited funds for the account apparently came primarily from small amounts of money forwarded to the coroner's office by the

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National Pituitary Foundation. 1 Though the funds were deposited into an account in Brady's name, they were used for various amenities for the Medical Examiner's Office. The account was openly kept; all of the employees in the office knew about it. Gebbie refused Brady's offer to resign at that time, but agreed to meet with him after she met with the State Attorney General the next day.

On June 21, 1985, Gebbie learned from the Attorney General that there was a pending criminal investigation against Dr. Brady. One area of the investigation concerned the account Brady had discussed with Gebbie. Gebbie met with Brady later that day and again refused his offer to resign. She then gave him a letter of suspension and informed him that he was suspended without pay pending an investigation into charges of misuse of public funds. Gebbie also issued a press release in which she stated that 1) Brady had been suspended "pending a Department of Justice investigation into allegations that miscellaneous fees coming to the Medical Examiner's office were put into a special account, apparently for the purchase of office amenities"; 2) Brady had reported to Gebbie that the fund was set up to help with office extras and had been in existence for years; and 3) the Department of Justice was conducting an impartial investigation into the matter.

After the suspension, Brady was the subject of extensive--and often unfavorable--press coverage. On September 17, 1985, the Attorney General issued a report which concluded that criminal sanctions against Brady were not warranted. On September 25, 1985, Brady, his attorneys Ronald Hoevet and Judy Snyder, and Dr. Homer Harris, the former Chairman of the State Medical Advisory Board, met with Gebbie. After Brady refused to resign, Gebbie handed him a letter of proposed termination.

The letter charged Brady with violating various state and departmental policies and accounting procedures by 1) using the proceeds given in reimbursement for specimens and autopsy report transcriptions to establish and maintain a "slush fund" for office parties and amenities; 2) using state and county facilities to conduct private autopsies for personal gain and in violation of conflict of interest policies; and 3) causing the state to be billed and to pay for toxicological reports made in connection with private autopsies which Brady performed. The letter also stated that on October 2, 1985, Brady would have the opportunity to come to Gebbie's office with his attorney to respond to the charges, and present mitigating or rebuttal information. Gebbie then issued a press release about the proposed termination. 2

Brady's attorney subsequently asked Herb Hirst, a Health Division employee, for a continuance of the forthcoming meeting. Hirst responded that the meeting was being held as a courtesy and indicated that Brady would not be allowed to summon or subpoena witnesses.

The meeting was held in Gebbie's office on October 2, 1985 and was attended by Gebbie, Brady, Brady's attorneys, Dr. Harris, and Brady's wife. Gebbie asked Brady for specific information regarding whether he had used particular state-owned equipment when he performed private autopsies. Brady stated that in order to answer her questions he needed time to check his records. He asked for a continuance to gather the necessary information to outline his response to the charges. Gebbie denied the request. She also denied Brady's request for a fair and public hearing.

The next day, October 3, 1985, Gebbie discharged Brady. The letter of discharge stated as the reasons for Brady's termination the same charges as were contained in the earlier letter of suspension. Gebbie also issued a press release in which she

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stated, inter alia, that Brady, "through his systematic 16-year diversion of public funds" had "knowingly violated public trust and confidence." She further stated that "[t]rust and confidence in Oregon State Government cannot be restored if Dr. Brady continues to work."

Gebbie's press release also stated that the findings of a comprehensive investigation by the Attorney General revealed four major areas of violations that led to Brady's dismissal. Those areas were identified as: 1) establishing a private autopsy business that Brady conducted from the State Medical Examiner's Office--using state employees working at the state's expense--and depositing the payments received into his personal and private bank accounts; 2) collecting and depositing into his private bank accounts payments received from the federal government for private autopsies which Brady had performed for federal agencies, when such services should have been done by the state and at state expense; 3) diverting and placing into a private bank account $16,000 of the state's money and using it for "lunches, staff parties, coffee, and other items not authorized by state government regulations"; and 4) using state contracted laboratory services for Brady's private autopsy business while charging the state for them.

On October 4, 1985, Brady's attorney delivered to Gebbie a seven-page letter which detailed Brady's response to the charges. On October 21, 1985, Gebbie informed Brady's attorney by letter that her decision to terminate Brady was unchanged.

Brady subsequently filed suit in the United States District Court for the District of Oregon, pursuant to 42 U.S.C. Sec. 1983, for monetary damages and reinstatement. Brady contended that in discharging him from public employment, Gebbie deprived him of his constitutionally protected property and liberty interests without due process of law. On November 4, 1986, the district court granted Gebbie's motion for partial summary judgment on the issue of reinstatement.

At the close of evidence, the court granted Gebbie's motion for a directed verdict on the property interest claims. The liberty interest claim was submitted to the jury, which returned a verdict in favor of Brady for $300,000. The court denied Gebbie's motions for JNOV, new trial, and remittitur. Gebbie timely appealed and Brady timely cross-appealed. We have jurisdiction pursuant to 28 U.S.C. Sec. 1291.

II.

Brady contends that the district court erred in directing a verdict for Gebbie on his property interest...

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