Cameo Convalescent Center, Inc. v. Percy, 85-1356

• Decision Date: 27 August 1986
• Docket Number: No. 85-1356,85-1356
• Citation: 800 F.2d 108
• Parties: CAMEO CONVALESCENT CENTER, INC., Plaintiff-Appellant, v. Donald E. PERCY, et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 108

800 F.2d 108

CAMEO CONVALESCENT CENTER, INC., Plaintiff-Appellant, v. Donald E. PERCY, et al., Defendants-Appellees.

No. 85-1356.

United States Court of Appeals, Seventh Circuit.

Argued May 8, 1986.

Decided Aug. 27, 1986.

Robert M. Hesslink, Jr., Monona, Wis., for plaintiff-appellant.

Charles Hoornstra, Dept. of Justice, Madison, Wis., for defendants-appellees.

Before CUMMINGS, Chief Judge, and BAUER, Circuit Judge, and ESCHBACH, Senior Circuit Judge.

BAUER, Circuit Judge.

Plaintiff Cameo Convalescent Center, Inc. ("Cameo") brought suit against Donald E. Percy, Secretary of the Wisconsin Department of Health and Social Services ("WDHSS"), and nine other state employees claiming that defendants' placement of Cameo on the suspension of referrals list ("SORL") for approximately fourteen days without an evidentiary hearing deprived it of liberty and property interests without due process of law in violation of the First, Ninth, and Fourteenth Amendments and the Civil Rights Act of 1871, 42 U.S.C. Sec. 1983. The district court granted defendants' motion for summary judgment and dismissed Cameo's complaint on the ground that it was not deprived of property without due process since it had full access to post-deprivation remedies under state law. We affirm.

I.

Cameo is a nursing home operating in Milwaukee, Wisconsin. In September 1978, the Bureau of Quality Compliance of the WDHSS inspected the Cameo nursing home. As a result of the inspection, Cameo was cited with thirty-four violations. Under Wisconsin law at that time, the Department was required to place a nursing home with five or more outstanding Class B or C citations on SORL. The effect of placement on this list is to limit referrals to the offending nursing home from county social service agencies and nursing home placement boards. Also under Wisconsin law at that time, a nursing home could not be placed on the list without a prior evidentiary hearing if the nursing home filed a timely request for a hearing. When the inspection revealed uncorrected violations, Cameo was subject to placement on SORL. On March 19, 1979, Cameo was advised by certified mail that it would be placed on SORL if it did not appeal within ten days.

On March 30, 1979, Cameo hand-delivered an appeal request to Ms. Nadene Dreher, a receptionist in the Madison office of the WDHSS. Ms. Dreher, who was authorized to accept appeals, has no recollection of receiving the appeal notice and no memory of what she did with the notice. Because of this confusion, Cameo's name appeared on the April 4, 1979 list. Cameo's March 30, 1979 appeal was discovered on April 12, 1979. There was some doubt as to the timeliness of its filing because no filing date was affixed to the Department's copy. After questioning the Department notary who verified the appeal, the Department decided to give Cameo the benefit of the doubt as to timeliness. The Department issued a corrected list to the same parties who had received the April 4, 1979 list. The Department also issued an apology to Cameo and a retraction removing Cameo from the list. The retraction was sent on April 13, 1979 to all county social service agencies, boards, and interested parties. Cameo received the apology before it knew it had been placed on SORL.

Cameo and three of its officers and directors brought suit against officers and employees of WDHSS alleging that they acted individually and in concert to deprive Cameo of liberty and property interests without due process of law. A bifurcated trial was held. Prior to the end of the liability phase of the trial, the district court dismissed the individual plaintiffs. At the conclusion of the liability phase of the trial, the jury found that the nurse-surveyor had acted with malice in prosecuting the violations against Cameo for ulterior or improper motives. The jury awarded Cameo compensatory damages of $65,000 and punitive damages of $10,000. The nurse and plaintiffs appealed. This court found that the district court erred in failing to instruct the jury on plaintiff's conspiracy theory and that the jury instructions on due process must inform the jury of Cameo's right to a hearing prior to placement on SORL. On remand, the district court then granted defendants' motion for summary judgment in light of Hudson v. Palmer, 468 U.S. 517, 104 S.Ct. 3194, 82 L.Ed.2d 393 (1984), and dismissed Cameo's complaint. This appeal followed.

II.

Cameo first argues that the district court was bound by the doctrine of the "law of the case" and was precluded from ruling on the summary judgment motions because it failed to grant defendants' prior motion to dismiss. Cameo also argues that the district court lacked the discretion to deviate from a mandate of this court and should have followed instructions on remand. We disagree with both arguments.

The district court has the discretion to make a different determination of any matters that have not been taken to judgment or determined on appeal. Pre-judgment orders, such as motions to dismiss, are interlocutory and may be reconsidered at any time. "In the absence of statute the phrase the 'law of the case' as applied to the effect of the previous orders on the later action of the court rendering them in the same case, merely expressed the practice of courts generally to refuse to reopen what has been decided, not a limit to their power." Messinger v. Anderson, 225 U.S. 436, 32 S.Ct. 739, 56 L.Ed. 1152 (1912). Therefore, we reject Cameo's argument that the district court's earlier refusal to dismiss Cameo's case precluded the district court from later granting summary judgment against Cameo.

Further, we find that the district court's refusal to hold to the doctrine is appropriate in this instance because of a change in...