Hagan v. Quinn

• Citation: 867 F.3d 816
• Decision Date: 02 February 2016
• Docket Number: No. 15-1791,15-1791
• Parties: Kathleen HAGAN, et al., Plaintiffs–Appellants, v. Patrick J. QUINN, et al., Defendants–Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (7th Circuit)

867 F.3d 816

Kathleen HAGAN, et al., Plaintiffs–Appellants,

v.Patrick J. QUINN, et al., Defendants–Appellees.

No. 15-1791

United States Court of Appeals, Seventh Circuit.

Submitted February 2, 2016^*

John A. Baker, Attorney, BAKER, BAKER & KRAJEWSKI, Springfield, IL, for Plaintiffs–Appellants.

Mary Ellen Welsh, Attorney, OFFICE OF THE ATTORNEY GENERAL, Civil Appeals Division, for Defendants–Appellees.

Before Flaum, Manion, and Hamilton, Circuit Judges.

Hamilton, Circuit Judge.

Plaintiffs are former arbitrators for the Illinois Workers' Compensation Commission. In 2011, plaintiffs and another arbitrator brought a due process action challenging the implementation of House Bill 1698, a workers' compensation reform statute that had terminated their six-year appointments under prior law. The district court granted summary judgment for defendants, and we affirmed, concluding that plaintiffs failed to demonstrate a clearly established right that was violated by legislation ending their six-year terms as arbitrators. Dibble v. Quinn , 793 F.3d 803, 814 (7th Cir. 2015) (the "Due Process Suit").¹

In October 2011, while the Due Process Suit was pending, the Illinois governor declined to reappoint plaintiffs, which ended their employment. Two years later, plaintiffs filed this action against the governor and two of his advisors in their individual and official capacities. Plaintiffs alleged that the defendants had retaliated against them for filing the prior suit and that the retaliation violated the First Amendment to the United States Constitution and Illinois state law. Plaintiffs sought damages and an injunction providing either reinstatement or comparable state employment.

The district court dismissed plaintiffs' First Amendment claims, holding that the Due Process Suit was not protected speech under the Connick – Pickering line of cases. See Connick v. Myers , 461 U.S. 138, 103 S.Ct. 1684, 75 L.Ed.2d 708 (1983) ; Pickering v. Board of Education of Township High School District 205 , 391 U.S. 563, 88 S.Ct. 1731, 20 L.Ed.2d 811 (1968). The court declined to exercise supplemental jurisdiction over plaintiffs' state-law claims.²

We affirm, but by a different path. We need not and do not decide whether the Due Process Suit was speech on a matter of public concern as is required for a government employee to show retaliation in violation of the First Amendment. Plaintiffs' claims fail for a more fundamental reason. Plaintiffs were policymakers who could be terminated—or, more precisely, not reappointed—for engaging in "speech on a matter of public concern in a manner that is critical of superiors or their stated policies." Kiddy–Brown v. Blagojevich , 408 F.3d 346, 358 (7th Cir. 2005) (citations omitted). A logical outgrowth of the Elrod – Branti line of cases, see Elrod v. Burns , 427 U.S. 347, 96 S.Ct. 2673, 49 L.Ed.2d 547 (1976), and Branti v. Finkel , 445 U.S. 507, 100 S.Ct. 1287, 63 L.Ed.2d 574 (1980), this policymaker corollary to the standard Pickering analysis allows elected officials to replace high-level and confidential employees not only when those employees merely belong to the "wrong" political party or faction but also when they engage in speech or other First Amendment activity that could undermine the policy or political goals of the officials accused of the retaliation. In this case, plaintiffs publicly challenged the implementation of House Bill 1698 as unconstitutional. They had a constitutional right to do so, but their exercise of that right came with consequences for their positions in state government that the Constitution also permits. In filing their lawsuit, plaintiffs sought to undercut a key component of the administration's workers' compensation reform initiative. That was reason enough for the governor to choose not to reappoint them as arbitrators. Given their positions in government, the First Amendment offers them no redress for the governor's choice.

I. Factual and Procedural Background

We review de novo the district court's dismissal of plaintiffs' First Amendment claims, accepting as true plaintiffs' well-pled factual allegations and drawing reasonable inferences in their favor. E.g., Simpson v. Brown County , 860 F.3d 1001, 1005 (7th Cir. 2017) ; Jakupovic v. Curran , 850 F.3d 898, 901 (7th Cir. 2017). We review for abuse of discretion the district court's decision under 28 U.S.C. § 1367(c)(3) not to exercise supplemental jurisdiction over plaintiffs' state-law claims. Burritt v. Ditlefsen , 807 F.3d 239, 252 (7th Cir. 2015).

A. The Due Process Suit

Plaintiffs were employed as arbitrators with the Illinois Workers' Compensation Commission from 1989 (plaintiffs Kathleen Hagan and Gilberto Galicia), 1990 (plaintiff Joseph Prieto), and 2003 (plaintiff Richard Peterson), until October 14, 2011. Plaintiffs allege that during the spring and early summer of 2011, articles published by Illinois media outlets drew public attention to problems with the state workers' compensation scheme. The legislature responded to these concerns. On June 28, 2011, then-Governor Quinn signed House Bill 1698 (as enacted, Public Act 97–18), amending the Workers' Compensation Act. See 820 Ill. Comp. Stat. 305/1 et seq.

A press release issued by the governor's office (and appended as an exhibit to plaintiffs' complaint) highlighted some of the key changes in the law. These included a substantial reduction in the medical fee schedule, implementation of new provider networks, enhanced enforcement mechanisms, and an electronic billing system. Most relevant here, the new legislation also changed the appointment scheme for arbitrators who decide employer/employee disputes. Notwithstanding prior law that established six-year terms for arbitrators and protected them from early discharge except for cause, the amended Act terminated all appointments effective July 1, 2011, but with the proviso that incumbents would "continue to exercise all of their duties until they are reappointed or their successors are appointed." 820 Ill. Comp. Stat. 305/14. Going forward, appointments were to be made by the governor with the advice and consent of the state senate. Initial appointments would last for one, two, or three years to set up classes of arbitrators with staggered terms. Thereafter, arbitrators would be appointed to three-year terms.

Unhappy with some of these changes—including the abrupt dissolution of their six-year terms—plaintiffs here and fellow arbitrator Peter Akemann sued the governor and members of the Workers' Compensation Commission. In their Due Process Suit, plaintiffs alleged principally that the amended law unconstitutionally deprived them of their property interest in their employment. Plaintiffs sought damages, a declaration that House Bill 1698 was unconstitutional as applied to them, and an injunction prohibiting defendants from removing them from office or "taking any other action in retaliation for the Plaintiffs' protection of their civil rights."

The district court granted summary judgment for defendants, rejecting plaintiffs' due process claim on its merits. Hagan v. Quinn , No. 11-CV-3213, 2014 WL 3052631, at *3 (C.D. Ill. July 7, 2014). We affirmed on alternative grounds, holding that plaintiffs "failed to demonstrate a clearly established right that was violated by legislation ending their six-year terms as arbitrators" and that defendants were thus entitled to qualified immunity. Dibble , 793 F.3d at 814.

B. The Retaliation Suit

On October 14, 2011, after plaintiffs filed the Due Process Suit but long before that case was decided, Governor Quinn decided which arbitrators would continue with their employment and which would be terminated. Plaintiffs were among those who were not reappointed. Two years later, plaintiffs filed this action alleging retaliation in violation of the First Amendment and the Illinois State Officials and Employees Ethics Act, 5 Ill. Comp. Stat. 430/1-1 et seq. Plaintiffs sued Governor Quinn; his chief of staff, Jerome Stermer; and an advisor, Velisha Haddox, in their individual and official capacities.

In their retaliation complaint, plaintiffs allege that their participation in the Due Process Suit was the "sole reason" they were not reappointed as arbitrators. Though plaintiffs concede that they each had a "personal motivation" in bringing the Due Process Suit, they insist that "their justifications for doing so were not limited to their personal interest." Rather, they felt it was "important to, in a public forum, hash out concerns ... regarding the workers' compensation reforms and to outline that the governor of the State of Illinois had violated the United States Constitution." According to plaintiffs, their speech/petitioning was their way of participating in a "significant public debate on an issue of importance to the people of the State of Illinois."

The district court disagreed. In granting defendants' motion to dismiss, the court held that, as a "matter of law, Plaintiffs' lawsuit to protect their jobs was not constitutionally protected speech." Hagan v. Quinn , 84 F.Supp.3d 826, 827 (C.D. Ill. 2015). Applying the Connick – Pickering framework for assessing First Amendment claims by government employees, the district court concluded that the Due Process Suit was not speech on a matter of public concern. Citing the admonition in Connick that courts must take account of the "content, form, and context" of an employee's speech, 461 U.S. at 147–48, 103 S.Ct. 1684, the district court reasoned that the Due Process Suit "cannot fairly be said to be about worker's compensation reform from a public view standpoint" but was instead a "purely personal" attempt by plaintiffs to "protect their jobs and reputations." Hagan , 84 F.Supp.3d at 831–32. The court held in the alternative that defendants were entitled to qualified immunity. Id. at 832–33.

The district court dismissed plaintiffs' First Amendment claims with prejudice. The court dismissed their state Ethics Act claims without...