Advanced Tech. Bldg. Solutions, L.L.C. v. City of Jackson

• Decision Date: 14 March 2016
• Docket Number: No. 15–60069.,15–60069.
• Citation: 817 F.3d 163
• Parties: ADVANCED TECHNOLOGY BUILDING SOLUTIONS, L.L.C.; Donald Hewitt, "Don", Plaintiffs–Appellants, v. CITY OF JACKSON, MISSISSIPPI, Defendant–Appellee.
• Court: U.S. Court of Appeals — Fifth Circuit

817 F.3d 163

ADVANCED TECHNOLOGY BUILDING SOLUTIONS, L.L.C.; Donald Hewitt, "Don", Plaintiffs–Appellants,

v.CITY OF JACKSON, MISSISSIPPI, Defendant–Appellee.

No. 15–60069.

United States Court of Appeals, Fifth Circuit.

March 14, 2016.

Robert Nicholas Norris, Louis Hanner Watson, Jr., Esq., Watson & Norris, P.L.L.C., Jackson, MS, for Plaintiffs–Appellants.

Claire Barker, Esq., Gail Wright Lowery, Esq., Pieter Teeuwissen, Esq., City Attorney's Office for the City of Jackson, Jackson, MS, for Defendant–Appellee.

Before JONES and SMITH, Circuit Judges, and BOYLE, District Judge.^*

JERRY E. SMITH

, Circuit Judge:

Advanced Technology Building Solutions, L.L.C. ("ATBS"), and Donald Hewitt, its owner, brought a First Amendment retaliation claim against the City of Jackson, alleging that the mayor, acting through city employees, ended support for a development project proposed by ATBS after Hewitt had made public statements claiming corruption in city government. Because the city council was the final policymaker with ultimate authority to approve (or reject) project funding, we affirm the judgment as a matter of law ("JML") in favor of the city.

I.

Through his company, ATBS, Hewitt wanted to redevelop a bank building in Jackson, seeking support and approval from the city. He reached out to the Jackson Redevelopment Authority ("JRA"), a distinct public entity, which is tasked with investing in urban renewal projects. See MISS.CODE ANN. §§ 43–35–31

, 43–35–33 (2015). He received initial support that was memorialized in a letter. The JRA and ATBS also entered into a memorandum of understanding whereby the JRA pledged to "use its best efforts to pursue issuance" of $5 million in bonds, which would be turned into a loan to ATBS to fund the project. Support for the project stalled in the JRA's finance committee and never made it to the city council, which would have had to give approval of the funding.¹

The city claims the project failed to move forward because of concerns regarding the city's ability to take on more debt through the issuance of bonds and because ATBS never provided certain financial documents. ATBS contends that the project was stopped by the mayor (acting through city and JRA employees) in retaliation for statements Hewitt had made to local press about cronyism in the mayor's office in regard to a different Jackson development project (a convention center and hotel), which Hewitt had bid for and lost despite offering a less expensive proposal.

ATBS and Hewitt sued the city under 42 U.S.C. § 1983

, alleging a variety of constitutional claims. After a four-day trial on allegations of First Amendment retaliation, the jury found in favor of ATBS and Hewitt and awarded $600,000. Jackson moved for judgment notwithstanding the verdict, contending that the mayor lacked final policymaking authority for the city and thus could not subject it to liability for his actions. The district court construed that as a request for JML under Federal Rule of Civil Procedure 50(b) and granted a JML, determining that the city council was the final policymaker in regard to funding.

II.

We review a JML de novo, applying the same standard as did the district court. Weiser–Brown Operating Co. v. St. Paul Surplus Lines Ins. Co., 801 F.3d 512, 525 (5th Cir.2015)

; Laxton v. Gap Inc., 333 F.3d 572, 577 (5th Cir.2003). JML is appropriate when "a party has been fully heard on an issue during a jury trial and ... a reasonable jury would not have a legally sufficient evidentiary basis to find for the party on that issue." FED.R.CIV.P. 50(a)(1). We "draw all reasonable inferences in favor of the nonmoving party, and [we] may not make credibility determinations or weigh the evidence." Laxton, 333 F.3d at 577 (alteration in original) (quoting Russell v. McKinney Hosp. Venture, 235 F.3d 219, 222 (5th Cir.2000) ). Nevertheless, we are permitted to give "credence to evidence supporting the moving party that is uncontradicted and unimpeached if that evidence comes from disinterested witnesses." Id.

III.

Parties can sue a municipality that has violated their constitutional rights "under color of any statute, ordinance, regulation, custom, or usage." 42 U.S.C. § 1983 (2015)

; see also Monell v. Dep't of Soc. Servs., 436 U.S. 658, 690, 98 S.Ct. 2018, 56 L.Ed.2d 611 (1978) (holding that municipalities are "persons" for purposes of § 1983 ). Thus, ordinarily, municipal liability must be based on "an official policy." Monell, 436 U.S. at 694, 98 S.Ct. 2018. In Pembaur v. City of Cincinnati, 475 U.S. 469, 480–81, 106 S.Ct. 1292, 89 L.Ed.2d 452 (1986), the Court further explained that a "single decision" by an authorized policymaker may represent "an act of official government policy." Nevertheless, "liability attaches only where the decisionmaker possesses final authority to establish municipal policy with respect to the action ordered." Id. at 481, 106 S.Ct. 1292. "The fact that a particular official—even a policymaking official—has discretion in the exercise of particular functions does not, without more, give rise to municipal liability based on an exercise of that discretion." Id. at 481–82, 106 S.Ct. 1292. Indeed, a municipality cannot be liable for the actions of its employees under the theory of respondeat superior. Monell, 436 U.S. at 691, 98 S.Ct. 2018

. Thus, the critical question is to decide who is the final policymaker, which is an issue of state law. See Jett v. Dall. Indep. Sch. Dist., 7 F.3d 1241, 1245 (5th Cir.1993).

A.

All of the evidence of alleged wrongdoing centered on Jackson's mayor. Thus, as both parties acknowledge, the critical question is whether he or the city council is the final policymaker in regard to funding decisions. ATBS and Hewitt contend that under Mississippi law the mayor is the final policymaker because he has "superintending control of all the officers and affairs of the municipality." MISS.CODE ANN. § 21–8–15

.

That theory carries little weight. Apart from any control that the mayor might exercise over city employees, both sides agree that the city council's approval would have been required for the issuance of any bonds or the expenditure of public funds for ATBS's project. The city points to Mississippi law, which confers the "legislative power" of a municipality on the city council. Id. § 21–8–9. The statute does not define explicitly whether the power of the purse is legislative or executive, but the city cites an opinion of the Mississippi Attorney General explaining that "the power to appropriate funds through a budget is a fundamental legislative power." In re McNeil, 1990 WL 547708, at *2 (Miss.A.G. Feb. 8, 1990)

. Thus, according to that opinion, it is the city council, not the mayor, that has final say over funding decisions. Id.

Under Mississippi law, "Attorney General opinions are not binding," though "they are certainly useful in providing guidance to [courts]."² We need not decide the persuasiveness of the Mississippi Attorney General's conclusion, however, because ATBS and Hewitt concede that the "Council would ultimately have had to approve any contract or agreement for project funding."

Thus, by ATBS's own admission, the city council holds the power of the purse. The obvious conclusion is that the city is likewise the final policymaker for funding decisions. It is true that the mayor can veto council resolutions (and every ordinance passed by the council must be submitted to the mayor for approval or rejection); nevertheless, the council can override a veto, thus giving the council ultimate say. See MISS.CODE ANN. § 21–8–17(2)

. Because the council has the right of final review, it is the final policymaker.

This conclusion is consistent with cases in which we have found reviewability by another political body "relevant to showing that an official is not a final policymaker." Bolton v. City of Dall., 541 F.3d 545, 550 n. 4 (5th Cir.2008)

(per curiam). Indeed, in Worsham v. City of Pasadena, 881 F.2d 1336, 1337, 1340–41 (5th Cir.1989), where the mayor had suspended a city employee and the city council later reinstated him, we held that the mayor was not a final policymaker for purposes of Monell liability. "[M]eaningful review by the City Council indicates that the [mayor] ... w[as] not ... [a] final policymaker[ ]". Id. at 1341. Thus, we agreed with the Eighth Circuit that "the existence of effective review procedures" could prevent "employees from wielding final responsibility." Id. (citing Williams v. Butler,

863 F.2d 1398 (8th Cir.1988) (en banc)).

Likewise, in Barrow v. Greenville Independent School District, 480 F.3d 377, 381–82 (5th Cir.2007)

, we held that a school superintendent, who had the "sole authority" to make personnel recommendations to the school board, was not a final policymaker when the board could reject those recommendations, even though it had statutory power to delegate final authority over personnel decisions to the superintendent. Similarly, in Beattie v. Madison County School District, 254 F.3d 595, 603 (5th Cir.2001), we held that a superintendent was not a final policymaker when she merely presented her recommendation of an employee's termination to the board, which effected the actual termination.

Thus, in multiple cases, we have affirmed that officials are not final policymakers when a supervisory board has the authority to accept or reject their decisions. In contrast, in Brady v. Fort Bend County, 145 F.3d 691, 700 (5th Cir.1998)

, we held that a sheriff was the final policymaker when his exercise of discretion was "unreviewable by any other official or governmental body in the county." Reviewability can be a significant factor when determining whether a public employee is a final policymaker.

Although in Gelin v. Housing Authority of New Orleans, 456 F.3d 525, 530 (5th Cir.2006)

, we interpreted Jett to "eschew[ ] the importance of administrative reviewability in distinguishing final decisionmaking authority from final policymaking authority," we nevertheless affirmed the relevance of ...