Deubert v. Gulf Federal Sav. Bank

• Citation: 820 F.2d 754
• Decision Date: 08 July 1987
• Docket Number: No. 86-3411,86-3411
• Parties: Patricia D. DEUBERT and Sonya M. Deroche, Plaintiffs-Appellants, v. GULF FEDERAL SAVINGS BANK, et al., Defendants-Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (5th Circuit)

Page 754

820 F.2d 754

56 USLW 2048

Patricia D. DEUBERT and Sonya M. Deroche, Plaintiffs-Appellants, v. GULF FEDERAL SAVINGS BANK, et al., Defendants-Appellees.

No. 86-3411.

United States Court of Appeals, Fifth Circuit.

July 8, 1987.

Gardner, Robein & Healey, Louis L. Robein, Jr., Metairie, La., for Deubert and Deroche.

Capitelli, Bencomo & Wicker, New Orleans, La., for Farley.

Milling, Benson, Woodward, Hillyer, Pierson & Miller, Frederick J. Plaeger, II, Gerald J. Huffman, Jr., New Orleans, La., for Leone, Gulf Federal, Lucas and Sylve & Farley.

Mahat & Duffy, Metairie, La., for defendants-appellees.

Appeal from the United States District Court for the Eastern District of Louisiana.

Before EDWARDS ^*, POLITZ and HILL, Circuit Judges.

ROBERT MADDEN HILL, Circuit Judge:

Patricia D. Deubert and Sonya M. Deroche (the plaintiffs) appeal the dismissal of their claims against Gulf Federal Savings Bank (Gulf Federal) and several present and former directors, officers, and employees of Gulf Federal (the defendants). ¹ In their suit the plaintiffs claimed that they were former employees of Gulf Federal whose employment was terminated because they "blew the whistle" about alleged irregular practices at Gulf Federal. The plaintiffs assert several claims based on 42 U.S.C. Sec. 1985(2) and (3); the National Housing Act, 12 U.S.C. Sec. 1701 et seq.; and the federal constitution. The district court concluded that the plaintiffs failed to state a claim upon which relief could be granted. After considering the plaintiffs' arguments, we agree with the district court and affirm.

I.

A dismissal for failure to state a claim upon which relief may be granted cannot be upheld "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 101-02, 2 L.Ed.2d 80 (1957). In reviewing such a dismissal, we must examine only the pleadings, accept the factual averments as true, and view them in the light most favorable to the plaintiff. Rankin v. City of Wichita Falls, Texas, 762 F.2d 444, 446 (5th Cir.1985). We set out the facts of the case using these principles.

Deubert and Deroche were long-time employees of Gulf Federal. Deubert was a customer service supervisor; Deroche was a credit manager and credit loan representative. In January 1985 Deubert and Deroche discovered that a vice-president of Gulf Federal was extending questionable loans to customers and performing other internal bank procedures in an irregular manner. In February they contacted a representative of the Federal Home Loan Bank Board (Board), an agency with regulatory authority over Gulf Federal, and reported their concerns.

The bank officer resigned voluntarily shortly after the Board received notice of the problems. Deubert and Deroche contend that they were soon subject to harassment and intimidation from Gulf Federal officers and directors because they had reported their suspicions. They assert that they were reassigned job tasks, lost job status, lost salary, and warned not to expose internal bank activities to the public or government agencies. Deubert and Deroche allege that as a result of this harassment they were forced to resign or were constructively discharged.

On January 31, 1986, Deubert and Deroche sued the defendants. Their basic complaint was that they had lost their positions by way of harassment and constructive discharge because they had reported the suspicious activities of the former vice-president. Their complaint was predicated on four different causes of action:

(1) a claim under 42 U.S.C. Sec. 1985(3) for a conspiracy by defendants to deprive them of an alleged right and/or obligation to report to the Board irregular banking practices;

(2) a claim under 42 U.S.C. Sec. 1985(2) for a conspiracy by defendants to harass and obstruct plaintiff's efforts to institute federal administrative and judicial proceedings;

(3) a claim implied under the National Housing Act which governs associations like Gulf Federal; and

(4) a state law claim for intentional infliction of emotional distress.

Gulf Federal filed a motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(6). Deubert and Deroche amended their complaint to add an implied cause of action in favor of American citizens who have been harassed because they informed federal officials of violations of federal law.

After a hearing on the motion to dismiss, the district court ruled that Deubert and Deroche had failed to state a cause of action cognizable under any federal law. Accordingly, the court dismissed with prejudice the plaintiffs' alleged federal claims and dismissed without prejudice the plaintiffs' pendent state law claims. Deubert and Deroche subsequently filed a notice of appeal.

II.

A.

Deubert and Deroche's first cause of action involves 42 U.S.C. Sec. 1985(3) ². To come within the ambit of section 1985(3), a complaint must allege: (1) a conspiracy of two or more persons; (2) for the purpose of depriving, either directly or indirectly, any person or class of persons of the equal protection of the laws, or of equal privileges and immunities under the laws; and (3) an act in furtherance of the conspiracy; (4) whereby a person is either injured in his person or property or deprived of any right or privilege of a citizen of the United States. United Brotherhood of Carpenters and Joinders of America, Local 610 v. Scott, 463 U.S. 825, 828-29, 103 S.Ct. 3352, 3356, 77 L.Ed.2d 1049 (1983) (citing Griffin v. Breckenridge, 403 U.S. 88, 102-103, 91 S.Ct. 1790, 29 L.Ed.2d 338 (1971); Great American Federal Savings and Loan Association v. Novotny, 442 U.S. 366, 372, 99 S.Ct. 2345, 2349, 60 L.Ed.2d 957 (1979). Furthermore, it is well-established in this circuit that the only conspiracies actionable under section 1985(3) are those motivated by racial animus. See Daigle v. Gulf States Utilities Co., Local 2286, 794 F.2d 974, 978-79 (5th Cir.1986); Eitel v. Holland, 787 F.2d 995, 1000 (5th Cir.1986); Rayborn v. Mississippi State Board of Dental Examiners, 776 F.2d 530, 532 (5th Cir.1985).

Deubert and Deroche do not claim that the alleged actions by the defendants were in any way motivated by racially discriminatory animus. Instead, they contend that the alleged conspirators were motivated by their reporting of alleged improprieties to the Board. Their failure to allege they were victims of a race-based conspiracy, however, forecloses the availability of relief under section 1985(3). Accordingly, we affirm the district court's dismissal of the plaintiffs' first cause of action. ³

B.

The second cause of action asserted by the plaintiffs is based on 42 U.S.C. Sec. 1985(2). ⁴ They allege "a private conspiracy of the defendants to harass and intimidate the plaintiffs as retaliation for their efforts to lawfully institute federal administration [sic] and judicial proceedings ..." This allegation is insufficient to state a cause of action under section 1985(2) for two reasons.

First, even taking the interference allegation as true, and assuming that the plaintiffs have pled a cognizable conspiracy, interference or obstruction of administrative proceedings is not redressable under section 1985(2). Daigle, 794 F.2d at 979-80. Second, the plaintiffs' efforts to institute a federal action are not protected from obstruction by section 1985(2). Plaintiffs seeking to recover under section 1985(2) must allege "a nexus between the alleged conspiracy and a proceeding in federal court." Bradt v. Smith, 634 F.2d 796, 801 (5th Cir. Unit A), cert. denied, 454 U.S. 830, 102 S.Ct. 125, 70 L.Ed.2d 106 (1981). They must further assert that they were injured on account of having attended or testified in federal court. Kimble v. D.J. McDuffy, Inc., 648 F.2d 340, 348 (5th Cir.) (en banc), cert. denied, 454 U.S. 1110, 102 S.Ct. 687, 70 L.Ed.2d 651 (1981).

The plaintiffs allege, however, that they were retaliated against for attempting to institute federal administrative and judicial proceedings. In Kimble we made it clear that alleged retaliation for "attempting" to file a federal lawsuit or even for actually filing such a lawsuit is insufficient to state a claim under section 1985(2). 648 F.2d at 347-48. We concluded that section 1985(2) was intended to protect those parties who were physically present to attend or testify in a federal court; the statute was not intended to create a federal tort remedy for economic retaliation against those who pursue work-related claims. Id. at 348. Since the plaintiffs have not alleged that they were injured as a result of their having attended or testified in a court proceeding, the district court properly dismissed their claim under section 1985(2).

III.

The plaintiffs' third allegation is that a private cause of action can be implied from the National Housing Act, 12 U.S.C. Sec. 1701 et seq., and the regulations which govern the Federal Savings and Loan Insurance Corporation (FSLIC) and the Board so that individuals who report violations of the law and regulations can obtain redress in federal court if adverse employment practices occur. The defendants, on the other hand, claim that Supreme Court precedent leads to the conclusion that no private cause of action can be implied from the National Housing Act. ⁵

The issue of whether a private cause of action can be implied from federal law is a matter of legislative intent. Universities Research Association, Inc. v. Coutu, 450 U.S. 754, 770, 101 S.Ct. 1451, 1461, 67 L.Ed.2d 662 (1981). The leading Supreme Court case in the area, Cort v. Ash, 422 U.S. 66, 95 S.Ct. 2080, 45 L.Ed.2d 26 (1975), sets out the analytical steps for determining whether a private cause of action exists for a violation of federal law. The four factors to consider are:

(1) Is the plaintiff one of the class for whose special benefit the statute was enacted?

(2) Is there any indication of legislative intent, explicit or implicit,...