Negrón-Almeda v. Santiago

• Decision Date: 26 August 2009
• Docket Number: No. 08-2360.,08-2360.
• Court: U.S. Court of Appeals — First Circuit
• Parties: Maribel NEGRÓN-ALMEDA, et al., Plaintiffs, Appellees, v. Carlos Gabriel SANTIAGO, et al., Defendants, Puerto Rico Trade and Export Company, Intervenor, Appellant.

579 F.3d 45

Maribel NEGRÓN-ALMEDA, et al., Plaintiffs, Appellees, v. Carlos Gabriel SANTIAGO, et al., Defendants, Puerto Rico Trade and Export Company, Intervenor, Appellant.

No. 08-2360.

United States Court of Appeals, First Circuit.

Heard April 6, 2009.

Decided August 26, 2009.

Eyck O. Lugo-Rivera, with whom Martinez Odell & Calabria were on brief, for appellant.

Claudio Aliff-Ortiz, with whom Eliezer A. Aldarondo-López and Aldarondo & López Bras, PSC were on brief, for appellees.

Before BOUDIN and LIPEZ, Circuit Judges, and SINGAL,^* District Judge.

LIPEZ, Circuit Judge.

Plaintiffs were employees of a government agency in Puerto Rico. After being dismissed, they brought suit for political discrimination in violation of the First Amendment. They sought, among other things, reinstatement to their former positions. By the time plaintiffs obtained a jury verdict in their favor, their former employer no longer existed, and its assets had been transferred by the legislature to another entity, the Puerto Rico Trade and Export Company ("COMEX"). COMEX moved to intervene, but the district court denied the motion while still ordering the remedy of reinstatement. In an earlier appeal, we vacated the district court's denial of COMEX's motion for intervention and reversed the judgment of the district court awarding the plaintiffs reinstatement. On remand, the district court permitted COMEX to intervene, but again imposed the reinstatement remedy against it.

On appeal, COMEX argues that the district court should not have enforced the reinstatement remedy against it for two reasons. First, COMEX argues that reinstatement was not available as a remedy, because the district court previously dismissed the official-capacity claims against the defendants and is barred from revisiting that order by the law of the case doctrine. Second, COMEX argues that reinstatement could not be ordered against it because it was not a party to the litigation and cannot be substituted for a party under Federal Rule of Civil Procedure 25(c) or 25(d).

Finding no error in the district court's rejection of these claims, we affirm.

I.

Because we have stated the facts of this case in our previous decisions (this is the third appeal in this case), we only briefly recapitulate them here. See Negrõn-Almeda v. Santiago, 528 F.3d 15, 18-21 (1st Cir.2008); cf. Peguero-Moronta v. Santiago, 464 F.3d 29, 34-53 (1st Cir.2006) (discussing evidence presented in first trial). Plaintiffs Maribel Negrõn-Almeda, Aracelis Gascot-Cuadrado, and Nilda Perez-Montalvo (collectively "plaintiffs") were career employees of Puerto Rico's Commercial Development Administration ("CDA"). After general elections in 2000 produced a change in political leadership, Carlos Gabriel Santiago ("Santiago") was appointed as Director of the CDA. Santiago and a subordinate, Susana Hernandez, dismissed the plaintiffs from their jobs.

In April 2001, plaintiffs brought suit against Santiago in his official and personal capacities and Susana Hernandez in her personal capacity (collectively "defendants").¹ The complaint asserted, inter alia, that the defendants had violated 42 U.S.C. § 1983 by terminating the plaintiffs from their positions at CDA on the basis of their membership in an opposition political party, in violation of the First Amendment. Discovery was conducted and both sides moved for summary judgment. On March 31, 2004, the district court entered summary judgment ("the March 31, 2004 order") dismissing the section 1983 claim brought against Santiago in his official capacity, concluding that sovereign immunity precluded the claim.²

The remaining claims went to trial, and the district court twice granted motions for judgment as a matter of law in favor of the defendants. See Fed.R.Civ.P. 50(a). Plaintiffs appealed, and we affirmed in part and reversed in part, concluding that the evidence was sufficient for several of the plaintiffs' claims to go to the jury. See Peguero-Moronta, 464 F.3d at 54. Notably, plaintiffs did not appeal the district court's earlier entry of summary judgment in favor of Santiago on the section 1983 claim brought against him in his official capacity.

The case was retried, and the jury found for the plaintiffs on the section 1983 claim, awarding them both compensatory and punitive damages. Plaintiffs then moved the district court to award the equitable relief sought in the complaint, including "reinstatement to career positions equal or similar to" positions they would have occupied if they had not been unlawfully terminated. Defendants opposed the request for equitable relief, arguing that reinstatement was inappropriate because no public officer remained in the case. Defendants also pointed out that during the pendency of the litigation, CDA had been dissolved and replaced with a new public corporation, COMEX, which had eliminated plaintiffs' former positions. The court denied the defendants' motion and, on April 30, 2007, entered judgment ordering the plaintiffs' reinstatement ("the April 30, 2007 judgment").

Defendants subsequently moved to clarify the April 30, 2007 judgment, again drawing the district court's attention to the fact that it had previously dismissed the official-capacity claims from the case, and the remedy of reinstatement was unavailable against the individual defendants. COMEX moved to intervene as of right, see Fed.R.Civ.P. 24(a), arguing that it had only recently learned of the suit, that CDA had not adequately represented its interests in the litigation, and that it had an interest in the action and would suffer undue prejudice if forced to reinstate plaintiffs. Simultaneously, COMEX filed a provisional motion with the district court to alter or amend the April 30, 2007 judgment, or in the alternative to vacate it.³ See Fed.R.Civ.P. 59(e), 60(b). COMEX argued that judgment could not be enforced against it, see Fed.R.Civ.P. 25, and that the controversy was moot in light of the dissolution of the CDA. The district court dismissed COMEX's motion to intervene as untimely, ruling that its March 31, 2004 order, see supra note 2, had "left reinstatement within the realm of remedial possibilities," and concluding that the order should have apprised COMEX that its interests might be affected.

On appeal, we vacated the district court's denial of intervention. See Negrõn-Almeda, 528 F.3d at 27. We noted that the March 31, 2004 order had unambiguously dismissed the official-capacity claim against Santiago and removed the reinstatement remedy from the case. Thus, "COMEX had no reason to believe that its interests, as opposed to the interests of the individual defendants, were implicated in the ongoing litigation." Id. at 23-24. We remanded the matter to the district court, and expressly left open the possibility that the plaintiffs, on remand, may seek to vacate or amend the pertinent provision of the [March 31] 2004 order so as to revive the issue of reinstatement. Should such a motion be made, the district court shall first reconsider COMEX's motion for intervention. Thereafter, it shall afford the intervenor ... and the defendants an opportunity to be heard on the motion to vacate and/or amend.

In that regard, the court shall consider, among other things, that in their earlier appeal to this court the plaintiffs could have, but did not, mount a challenge to the [March 31,] 2004 order. Thus, the court will have to determine whether that foregone opportunity precludes it from revisiting the [March 31,] 2004 order.

Id. at 27 (internal citations omitted).

On remand, COMEX again moved to intervene and to alter or amend the April 30, 2007 judgment. In the latter motion, COMEX argued that the district court could not revisit its March 31, 2004 order because the order now constituted the law of the case. Even if the district court could revisit the order, COMEX argued, the district court could not enforce reinstatement against COMEX. In response, plaintiffs asked the court to revisit the March 31, 2004 order, permit them to reintroduce the claim for reinstatement into the case, and enforce a judgment against COMEX under Federal Rule of Civil Procedure 25(c), which governs substitution of parties in cases where a party transfers an interest during litigation.

The district court granted COMEX's motion to intervene and denied its motion to alter or amend the April 30, 2007 judgment ordering reinstatement of the plaintiffs. The district court agreed that the March 31, 2004 order constituted the law of the case, but concluded that it could nonetheless revisit the order under the "manifest injustice" exception to that doctrine. The court then determined that reinstatement was an appropriate equitable remedy for the plaintiffs' section 1983 claim, and that judgment could be enforced against COMEX pursuant to Federal Rule of Civil Procedure 25(c).

COMEX appeals. It argues that the law of the case doctrine barred the district court from revisiting the March 31, 2004 order, and that the reinstatement remedy could not be enforced against it under Rules 25(c) or 25(d).

II.

We turn first to COMEX's contention that the district court erred in revisiting the March 31, 2004 order. We then address COMEX's argument that the reinstatement remedy can not be enforced against it.

A. Law of the Case

We review de novo whether the law of the case doctrine applies. Harlow v. Children's Hosp., 432 F.3d 50, 55 (1st Cir.2005). Under the law of the case doctrine, "when a court decides upon a rule of law, that decision should continue to govern the same issues in subsequent stages in the same case." United States v. Wallace, 573 F.3d 82, 87-88 (1st Cir.2009) (internal quotation marks and citation omitted). We have sometimes said that law of the case has "two branches" or two forms. See, e.g., United States v. Moran, 393 F.3d 1, 7 (1st Cir.2004); Ellis v. United States, 313 F.3d 636, 646 (1st Cir.2002). The first branch, called the "mandate rule," ...