Doughty v. State Employees' Ass'n of N.H.

• Citation: 981 F.3d 128
• Decision Date: 30 November 2020
• Docket Number: No. 19-1636,19-1636
• Parties: Patrick DOUGHTY; Randy Severance, Plaintiffs, Appellants, v. STATE EMPLOYEES' ASSOCIATION OF NEW HAMPSHIRE, SEIU LOCAL 1984, CTW, CLC, Defendant, Appellee.
• Court: U.S. Court of Appeals — First Circuit

981 F.3d 128

Patrick DOUGHTY; Randy Severance, Plaintiffs, Appellants,

v.STATE EMPLOYEES' ASSOCIATION OF NEW HAMPSHIRE, SEIU LOCAL 1984, CTW, CLC, Defendant, Appellee.

No. 19-1636

United States Court of Appeals, First Circuit.

November 30, 2020

Frank D. Garrison, with whom Milton L. Chappell, National Right to Work Legal Defense Foundation, Inc., Springfield, VA, Bryan K. Gould, Cooley Ann Arroyo, and Cleveland, Waters & Bass, P.A., Concord, NH, were on brief, for appellants.

Leon Dayan, with whom Ramya Ravindran, Washington, DC, was on brief, for appellee.

Before Howard, Chief Judge, Thompson and Barron, Circuit Judges.

BARRON, Circuit Judge.

This appeal concerns a suit by two New Hampshire state employees, Patrick Doughty and Randy Severance, against the State Employees' Association of New Hampshire ("the Union") pursuant to 42 U.S.C. § 1983. They seek retrospective relief for themselves and other state employees who were not members of the Union but were forced to pay so-called "agency fees" to it prior to the United States Supreme Court's decision in Janus v. American Federation of State, County & Municipal Employees, Council 31, ––– U.S. ––––, 138 S. Ct. 2448, 201 L.Ed.2d 924 (2018). There, the Court overruled its decades-old decision in Abood v. Detroit Board of Education, 431 U.S. 209, 97 S.Ct. 1782, 52 L.Ed.2d 261 (1977), and held that such "agency fee" arrangements violate the First Amendment of the United States Constitution by compelling the speech and association of non-union governmental employees. The District Court granted the Union's motion to dismiss Doughty and Severance's complaint, and we affirm, aligning ourselves with every circuit to have addressed whether such a backward-looking, Janus-based claim is cognizable under § 1983.¹

I.

A.

New Hampshire state law imposes on unions that serve as the exclusive representative of a bargaining unit for state or local government employees a duty of fair representation to the unit's non-union employees during the collective bargaining process. See Nashua Tchrs. Union v. Nashua Sch. Dist., 142 N.H. 683, 707 A.2d 448, 451 (1998) (citing N.H. Rev. Stat. Ann. § 273-A:3 ). Prior to Janus's overruling of Abood, the New Hampshire Supreme Court held that the State's "overall legislative scheme to promote labor peace" impliedly permitted the negotiation of collective bargaining agreements between unions and governmental employers that called for the payment of agency fees. See id. at 450. In addition, the New Hampshire Supreme Court held that, under Abood, the First Amendment was not violated if a state or local governmental employer made the payment of these fees in connection with such agreements a condition of employment for their employees. Id.

The New Hampshire Supreme Court explained that collective bargaining agreements are contracts forged between the employer and the union that serves as the exclusive bargaining representative for the relevant bargaining unit. Id. at 451. It further explained that agency fees compensate for the fact that, although such a union secures benefits through the collective bargaining process for the bargaining unit's union and non-union employees alike, only the union employees pay dues to the union. Id. Thus, until Janus, New Hampshire permitted "agency fees" to "defray the costs associated with [the union's] exclusive representation and collective bargaining," and such fees were regularly a subject of collective bargaining agreements between unions and public employers in the state. Id. at 449.

B.

On January 14, 2019, following Janus, Doughty and Severance filed suit in the United States District Court for the District of New Hampshire against the Union under § 1983. Their complaint alleged that the Union was the exclusive representative for their respective bargaining units and that they were not themselves members of the Union. The complaint further alleged that, at the time relevant to this suit, they were "forced" to pay agency fees to the Union "as a condition of employment" in connection with the Union's collective bargaining agreements with their respective state employers. Finally, their complaint claimed that "the State" deducted the agency fees from their paychecks and remitted them to the Union, although the record offers no further details about the mechanics of the payment process.

By the time that Doughty and Severance filed their suit, the Union had ceased collecting agency fees, as deductions from the employees' paychecks to pay those fees ended in Janus's wake. Their complaint nevertheless requested, based on Janus's retroactive application, that the District Court certify a class of "all individuals employed by the State, and other public employers, who, as a condition of employment, were forced to pay union fees to [the Union], which distributed some of the fees to its affiliates, any time during the limitations period." Doughty and Severance further claimed that the members of this class were entitled, pursuant to § 1983, to "compensatory damages, refunds, or restitution in the amount of compulsory union fees paid to the Union from their wages without their written consent, and other amounts as principles of justice and equity require."

C.

On March 18, 2019, the Union moved to dismiss the plaintiffs' complaint for failure to state a claim on which relief could be granted under Federal Rule of Civil Procedure 12(b)(6). The District Court held a hearing on that motion on May 30, 2019 and granted it that same day.

The District Court proceeded on the understanding -- which the Union did not contest -- that, due to Janus's retroactive application, the state employers' requirement that the agency fees be paid as a condition of Doughty's and Severance's employment violated the First Amendment. The District Court also assumed -- and, again, without dispute -- that the Union, although a private entity, was a proper defendant under § 1983 for this Janus-based suit, despite the fact that the requirement to pay the agency fees had been imposed on them by their employer as a condition of their employment and not by the Union itself.² Finally, the District Court implicitly recognized that the doctrine of qualified immunity, which protects governmental officials from damages liability when sued in their individual capacities under § 1983 in the absence of their having violated "clearly established" law, see District of Columbia v. Wesby, ––– U.S. ––––, 138 S. Ct. 577, 589, 199 L.Ed.2d 453 (2018), does not protect private defendants, see Wyatt v. Cole, 504 U.S. 158, 168-69, 112 S.Ct. 1827, 118 L.Ed.2d 504 (1992), and so provided no such immunity to the Union here.

Nevertheless, the District Court expressed skepticism that § 1983 permitted Doughty and Severance's claim against the Union to go forward, given their claim's exclusive focus on agency-fee payments made prior to Janus. In that connection, the District Court asked the plaintiffs' counsel at the hearing on the motion to dismiss to "step back for a second" and explain "how in any version of the world" it would be "right to require [the Union] to pay damages for acting consistent with the requirements of state law and ... [S]upreme [C]ourt precedent." The District Court emphasized that the Union's "behavior was entirely constitutional at the time they engaged in it," and that it is an unusual situation where the Supreme Court "decides to flatly overturn its prior precedent." Because, as a general matter, "[o]ne of the reasons that judges express their views in written opinions is so that people can rely on" them, the District Court explained, it would be "arrogant in the extreme" to allow individuals who had so relied to be "subjected to suits for damages" in the rare cases where "judges flip 180 degrees on the law." The District Court added that it was "incomprehensible" that "damage[s] actions [could] be maintained under" the "unique circumstances" of this case.

The District Court then granted the Union's motion to dismiss Doughty and Severance's complaint based on two independent grounds. First, the District Court ruled that "a good faith defense must be available to protect defendants under these kinds of circumstances" (emphasis added), and that Doughty and Severance could not overcome that defense. Second, the District Court held that Doughty and Severance's § 1983 claim was analogous to the common-law tort of abuse of process, for which a "good faith defense has traditionally been recognized."³ For this reason, too, the District Court held, Doughty and Severance would have to overcome a "good faith defense" to succeed in obtaining their requested relief, which they could not do, given that the Union collected the fees at issue before Janus overruled Abood.

The District Court emphasized that it did not find the plaintiffs' claim for retrospective relief -- whether for damages or restitution -- to be "frivolous," but it closed by stating that it did not "see how it [could] possibly proceed." Instead, the District Court suggested that the plaintiffs appeal the case because it "would need guidance from the First Circuit explaining ... why the claim is potentially viable" to recognize it.

D.

Following the District Court's ruling, Doughty and Severance timely filed this appeal on June 21, 2019, in which they challenge the District Court's grant of the Union's 12(b)(6) motion. We have jurisdiction under 28 U.S.C. § 1291. We review the District Court's dismissal of a case under Federal Rule of Civil Procedure 12(b)(6) de novo. See Reisman v. Associated Faculties of Univ. of Me., 939 F.3d 409, 411 (1st Cir. 2019).

II.

As to the claim for damages, Doughty and Severance ask us to focus on § 1983's text, which expressly provides that "[e]very person" responsible for depriving another of their constitutional rights "shall be liable to the party injured in an action at law," 42 U.S.C. § 1983. They then proceed to argue that, because Janus applies retroactively and...