Lovell v. One Bancorp

• Decision Date: 27 February 1989
• Docket Number: No. 88-1915,88-1915
• Citation: 878 F.2d 10
• Parties: Ann B. LOVELL, etc., Plaintiff, Appellee, v. The ONE BANCORP, et al., Defendants, Appellees. Appeal of Frederick W. PAPE, Jr., Defendant. . Heard
• Court: U.S. Court of Appeals — First Circuit

Page 10

878 F.2d 10

58 USLW 2082

Ann B. LOVELL, etc., Plaintiff, Appellee, v. The ONE BANCORP, et al., Defendants, Appellees Appeal of Frederick W. PAPE, Jr., Defendant.

No. 88-1915.

United States Court of Appeals First Circuit.

Heard Feb. 27, 1989.

Decided June 22, 1989.

Rufus E. Brown with whom Jay S. Blumenkopf and Drummond Woodsum Plimpton & MacMahon were on brief, for defendant, appellant.

John S. Campbell with whom Richard E. Poulos and Poulos, Campbell & Zendzian were on brief, for plaintiff, appellee Ann B. Lovell.

Before CAMPBELL, Chief Judge, COFFIN, Senior Circuit Judge, and FUSTE, ^* District Judge.

LEVIN H. CAMPBELL, Chief Judge.

Frederick W. Pape, Jr., defendant-appellant, has filed this interlocutory appeal from the district court's denial of his claim of qualified immunity. Because we find that Pape, a private party, has no right to an interlocutory appeal under the circumstances of this case, we dismiss his appeal for lack of jurisdiction.

I.

In 1984, the board of trustees of the Maine Savings Bank ("Bank") adopted a Plan of Conversion ("Plan") to convert Bank from a mutual association into a stock corporation pursuant to Me.Rev.Stat.Ann. tit. 9-B, Sec. 344 (1980) and the Federal Home Loan Bank Board's regulations on mutual-to-stock conversions, 12 C.F.R Sec. 563b (1988). ¹ Under the Plan, a holding company, The One Bancorp ("Bancorp"), was created to hold Bank's capital stock after conversion. Bancorp would then raise capital through two offerings of Bank's stock, one to subscription holders and one to the public. The plan included Bank's depositors among these subscription holders, giving them nontransferable subscription rights to buy Bank's stock.

The Plan was approved by the Federal Reserve Board and also conditionally approved by the Superintendent of Maine's Bureau of Banking. Eligible depositors were notified of the Superintendent's conditional approval, the details of the conversion plan, and various rights they had regarding the conversion, including their right to vote for or against conversion at an upcoming meeting. On May 11, 1984, eligible depositors approved the conversion. After Bancorp conducted the two stock offerings, the Superintendent issued a certificate declaring the conversion final.

Plaintiff, Ann B. Lovell, ² brought this action under 42 U.S.C. Sec. 1983 (1982) challenging Bank's conversion, the process by which it was approved, and the Maine statutes that authorized it. The complaint named as defendants Bank, Bancorp, Robert Masterton, the chief executive officer and director of Bank and Bancorp, and the appellant, Frederick Pape, the chairman of the executive committee of Bank's and Bancorp's boards of directors. The complaint essentially asserted that as a depositor in a preconversion mutual association, plaintiff "owned" a portion of the association proportionate to his deposits there, and thus had a protected property interest for which he was entitled to be compensated. Plaintiff claimed that the conversion deprived him of that property interest without affording him due process, equal protection or the protection of the contract clause of the federal Constitution. The complaint alleged that the actions of the private defendants constituted "state action" because they had acted jointly with the Superintendent who gave them substantial encouragement and assistance, and because defendants utilized state procedures, statutes, and orders of state officials in allegedly violating plaintiff's constitutional rights. Plaintiff also asserted various pendent state claims. ³

Pape moved under Fed.R.Civ.P. 12(c) for judgment on the pleadings. Among the various arguments advanced in his motion, Pape argued that he was entitled to qualified immunity from plaintiff's claims. While not expressly addressing Pape's qualified immunity claim, the district court denied Pape's Rule 12(c) motion. Lovell v. One Bancorp, 690 F.Supp. 1090 (D.Me.1988). Pape has filed this interlocutory appeal from the district court's denial of his qualified immunity claim. Plaintiff has moved to dismiss this appeal for lack of jurisdiction.

II.

This court's jurisdiction stems primarily from 28 U.S.C. Sec. 1291 (1982), which provides that the courts of appeals may review "final decisions of the district courts of the United States." The Supreme Court has explained the importance and purpose of the "finality" requirement embodied in the statute:

The statutory requirement of a "final decision" means that "a party must ordinarily raise all claims of error in a single appeal following final judgment on the merits." Firestone Tire & Rubber Co. v. Risjord, 449 U.S. 368, 374 [101 S.Ct. 669, 673, 66 L.Ed.2d 571] (1981). As the Court noted in Firestone, the final judgment rule promotes efficient judicial administration while at the same time emphasizing the deference appellate courts owe to the district judge's decisions on the many questions of law and fact that arise before judgment. Ibid.; Flanagan v. United States, 465 U.S. , at 263-264 [104 S.Ct. 1051, 1054, 79 L.Ed.2d 288 (1984) ]. Immediate review of every trial court ruling, while permitting more prompt correction of erroneous decisions, would impose unreasonable disruption, delay, and expense. It would also undermine the ability of district judges to supervise litigation. In Sec. 1291 Congress expressed a preference that some erroneous trial court rulings go uncorrected until the appeal of a final judgment, rather than having litigation punctuated by "piecemeal appellate review of trial court decisions which do not terminate the litigation." United States v. Hollywood Motor Car Co., 458 U.S. 263, 265 [102 S.Ct. 3081, 3082, 73 L.Ed.2d 754] (1982).

Richardson-Merrell Inc. v. Koller, 472 U.S. 424, 429-30, 105 S.Ct. 2757, 2760-61, 86 L.Ed.2d 340 (1985).

The Supreme Court has recognized a "narrow exception" to the final judgment rule, known as the collateral order doctrine, for a " 'small class' of prejudgment orders which 'finally determine claims of right separable from, and collateral to, rights asserted in the action, [and are] too important to be denied review and too independent of the cause itself to require that appellate consideration be deferred until the whole case is adjudicated.' " Id. at 430, 105 S.Ct. at 2761 (quoting Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 546, 69 S.Ct. 1221, 1225-26, 93 L.Ed. 1528 (1949)). See also In re Recticel Foam Corp., 859 F.2d 1000, 1003-04 (1st Cir.1988). Pape argues that the district court's denial of his qualified immunity claim falls within the narrow confines of the collateral order doctrine and thus provides the basis for this interlocutory appeal. In support of his argument, he cites Mitchell v. Forsyth, 472 U.S. 511, 105 S.Ct. 2806, 86 L.Ed.2d 411 (1985).

In Forsyth, the Supreme Court held that a district court's denial of a government official's claim of qualified immunity fell within the collateral order doctrine, and thus gave the government official the right to an immediate appeal. The Court's holding was based primarily on its ruling that a government official's right to qualified immunity embodies not only an immunity from damages but also an entitlement not to stand trial. Id. at 525-27, 105 S.Ct. at 2814-16. See also Harlow v. Fitzgerald, 457 U.S. 800, 813-19, 102 S.Ct. 2727, 2735-39, 73 L.Ed.2d 396 (1982). The Court reasoned that this entitlement not to stand trial was necessary to avoid the "distraction of officials from their governmental duties, inhibition of discretionary action, and deterrence of able people from public service" caused by the burdens of litigation which "can be peculiarly disruptive of effective government." Forsyth, 472 U.S. at 526, 105 S.Ct. at 2815 (quoting Harlow, 457 U.S. at 816-17, 102 S.Ct. at 2737-38). Because an entitlement not to stand trial would be "effectively lost if a case is erroneously permitted to go to trial," the Court held that the denial of qualified immunity should be immediately appealable. Id. at 526-27, 105 S.Ct. at 2815-16.

We do not believe that Forsyth 's rationale applies to Pape. Forsyth, as indicated above, turned upon the harm done to effective government and to government officials when the right of the official not to stand trial was violated. These concerns are not present in this case. Pape is a private party, not a government official. His allegedly unlawful actions did not take place in the course of the performance of public duties. Rather, he was an officer in a private company engaged in private, commercial activity. ⁴ If a private party like Pape is entitled to bypass the rule against piecemeal review, one might wonder why any private person raising unsuccessfully a defense which, if meritorious, would confer victory prior to trial, should not also be granted an interlocutory appeal. Yet to do so...