Eilrich v. Remas

• Decision Date: 17 February 1988
• Docket Number: No. 86-2940,86-2940
• Citation: 839 F.2d 630
• Parties: Mark EILRICH, Plaintiff-Appellant, v. Bernard J. REMAS, et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 630

839 F.2d 630

Mark EILRICH, Plaintiff-Appellant, v. Bernard J. REMAS, et al., Defendants-Appellees.

No. 86-2940.

United States Court of Appeals Ninth Circuit.

Argued and Submitted Oct. 7, 1987.

Decided Feb. 17, 1988.

Amitai Schwartz, Law Offices of Amitai Schwartz, San Francisco, Cal., for plaintiff-appellant.

Charles K. Brunn, Philip W. Harvey, Brunn, Thayer, Flynn & Harvey, and Michael D. Milich, Modesto, Cal., for defendants-appellees.

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

Before SKOPIL, and NELSON, Circuit Judges, and O'SCANNLAIN, ^* Circuit Judge.

NELSON, Circuit Judge:

Appellant Mark Eilrich, a municipal police officer, was discharged by the City of Riverbank ("the City") after making statements about a controversy within the police department to the Riverbank City Council. A city administrative hearing officer, in upholding Eilrich's discharge, determined that the statements were not protected by the first amendment. The district court granted summary judgment for the City, finding that collateral estoppel barred Eilrich's claim for relief under 42 U.S.C. Sec. 1983 (1982). The district court had jurisdiction pursuant to 28 U.S.C. Sec. 1343 (1982). We have jurisdiction pursuant to 28 U.S.C. Sec. 1291 (1982). We affirm.

BACKGROUND

The City discharged Eilrich on November 21, 1984 in response to statements he made as a representative of the Riverbank Police Officer's Association at a city council meeting. Eilrich was discharged for making the following statements, which were part of one speech delivered during the public business portion of the meeting:

1. "Chief Remas has recently commented in the local news media, in response to our publicly made unanimous 'no confidence' vote of his, ah, management practices, that it is his belief that the Riverbank Police Department is currently 'strong and viable' as an organization. It is our equally strong belief, as the actual members of the organization which he is describing, that his contention is simply false."

2. "Over the past several years it has been the policy of the Chief of Police to cause dismissal of traffic citations in the interest of justice."

3. "This practice is an unethical use of the Chief's power for his own personal or political purposes."

4. "There's been a misappropriation of public funds or time by favored members of the Police Department and although this was brought to the attention of the Chief of Police, no action was taken."

5. "Since our attendance at the last Council meeting and resulting local publicity, members of our association have been threatened with job action if they persisted in communicating with the media."

6. "There have been grievances filed through the Chief of Police up to the City Administrator, and not on every particular item."

The City discharged Eilrich, alleging that the statements constituted (1) insubordination; (2) dishonesty; and (3) failure to follow specific grievance procedures. Eilrich appealed his discharge pursuant to Cal.Gov't Code Sec. 3304(b) (West 1980) and the City's Merit System Rules and Regulations ("the City Rules"). The hearing officer, a retired California Superior Court judge, held a 14-day proceeding. The hearing officer had adjudicatory power to resolve all the disputed issues submitted by the parties pursuant to Cal.Gov't Code Secs. 11513 & 19570, et seq., (West 1980 & Supp.1987) and the City Rules. On May 1, 1985, the hearing officer found that the City had not proved that Eilrich violated the City Rules by speaking to the city council rather than following the formal grievance procedures. However, the officer upheld Eilrich's discharge on the grounds of insubordination and dishonesty. He found that Eilrich made the statements at issue; that they constituted insubordination; and that they were "false and were made wilfully, recklessly, and irresponsibly." The hearing officer determined that the statements were not protected by the first amendment because he found, after examining the factual circumstances surrounding the statements, that the City's interest in efficient functioning of the police After the decision, the City Attorney immediately sent a letter notifying Eilrich that judicial review of this determination by a California superior court was available. However, the administrative decision became final when Eilrich failed to appeal within the statutory period. See Cal.Civ.Proc.Code Secs. 1094.5, 1094.6 (West 1980). Eilrich subsequently filed a 42 U.S.C. Sec. 1983 action in the district court on November 14, 1985, claiming that the appellees impermissibly discharged him for exercising his first amendment rights. On November 10, 1986, the district court granted the City's motion for summary judgment, finding that collateral estoppel barred consideration of the claim because the scope of protection afforded the statements by the first amendment had been determined in the prior proceeding. Eilrich timely appealed.

force outweighed Eilrich's interest in expressing his views on a matter of public concern.

ISSUE PRESENTED

Whether collateral estoppel bars consideration of Eilrich's 42 U.S.C. Sec. 1983 claim because the same issues were resolved in a prior unreviewed administrative determination.

STANDARD OF REVIEW

The availability of collateral estoppel is a mixed question of law and fact which this court reviews de novo. Davis & Cox v. Summa Corp., 751 F.2d 1507, 1519 (9th Cir.1985). If collateral estoppel is available, this court reviews the district court's decision giving preclusive effect to the determination of the municipal hearing officer for abuse of discretion. See Plaine v. McCabe, 797 F.2d 713, 718 (9th Cir.1986).

DISCUSSION

I. THE AVAILABILITY OF COLLATERAL ESTOPPEL

Collateral estoppel, or "issue preclusion", requires that "[w]hen an issue of fact or law is actually litigated and determined by a valid and final judgment, and the determination is essential to the judgment, the determination is conclusive in a subsequent action between the parties, whether on the same or a different claim." Restatement (Second) of Judgments Sec. 27 (1982). Federal courts must give preclusive effect to state court reviewed administrative determinations under 28 U.S.C. Sec. 1738, Marrese v. American Academy of Orthopaedic Surgeons, 470 U.S. 373, 105 S.Ct. 1327, 84 L.Ed.2d 274 (1985), and to unreviewed administrative findings under federal common law rules of preclusion. University of Tennessee v. Elliott, 478 U.S. 788, 106 S.Ct. 3220, 3224, 92 L.Ed.2d 635 (1986). In Elliott, the Court held that state administrative proceedings must be given the same preclusive effect they would be given in that state when an administrative agency, "acting in a judicial capacity ... resolves disputed issues of fact properly before it which the parties have had an adequate opportunity to litigate." 106 S.Ct. at 3227 (quoting United States v. Utah Constr. & Mining Co., 384 U.S. 394, 422, 86 S.Ct. 1545, 1560, 16 L.Ed.2d 642 (1966)).

Eilrich argues that the administrative decision was not preclusive because it was not reviewed by the California courts. Under California law, a discharged police officer is entitled to de novo judicial review of administrative agency determinations. See Cal.Civ.Proc.Code Sec. 1094.5 (West 1980); Perea v. Fales, 39 Cal.App.3d 939, 114 Cal.Rptr. 808 (1974). Eilrich failed to seek review by the California courts even though he was advised of its availability. "If an adequate opportunity for review is available, a losing party cannot obstruct the preclusive use of the state administrative decision simply by foregoing [the] right to appeal." Plaine, 797 F.2d at 719 n. 12. In Plaine, we applied preclusion in similar circumstances when an appellant failed to seek judicial review by the California courts. Likewise, the discharged employee in Elliott failed to appeal an administrative determination through the state courts, 106 S.Ct. at 3223, and the Court applied collateral estoppel to bar his Sec. 1983 claim even though the prior determination was unreviewed. Id. at 3225-26.

Eilrich relies on a Ninth Circuit case applying federal common law principles of collateral estoppel to argue that unreviewed administrative findings do not merit preclusive effect. Mack v. South Bay Beer Distributors, Inc., 798 F.2d 1279 (9th Cir.1986). Such reliance is misplaced because the court in Mack declined to give an unreviewed administrative hearing preclusive effect primarily because the plaintiff had had no opportunity to litigate his age discrimination claim, applying the Utah Construction standard. Id. at 1283. The nature of the unemployment compensation hearing had denied him the opportunity to litigate his claim and it was unclear if any evidence at all on the issue of age discrimination had been presented. Id. at 1283-84.

Eilrich also argues that this court should distinguish between according preclusive effect to state and municipal administrative determinations. Federal courts afford preclusive effect to state determinations because of comity and finality concerns. Elliott, 106 S.Ct. at 3226-27. The finality interests in according preclusive effect to both types of determinations are identical. Although the comity interests in affording preclusive effect to municipal and state determinations are not identical, respecting a state court system for review of administrative decisions is furthered by applying collateral estoppel to Eilrich's claim. If collateral estoppel is not applicable to unreviewed municipal decisions, litigants will be encouraged to avoid state court review of municipal administrative determinations in order to obtain federal review of their claims. Looking to California preclusion law, as the Supreme Court instructed in Elliott, we find support for this conclusion. California courts accord collateral estoppel effect to municipal administrative hearings that have sufficient judicial safeguards. See, e.g., ...