McCarthy v. Mayo

• Decision Date: 30 October 1987
• Docket Number: No. 86-2591,86-2591
• Citation: 827 F.2d 1310
• Parties: Michael F. McCARTHY, Plaintiff-Appellant, v. Stephen A. MAYO, individually, and in his capacity as Special Deputy Attorney General for the State of Hawaii and as Special Assistant U.S. Attorney; William J. Eggers, III, individually, and in his capacity as Special Deputy Attorney General for the State of Hawaii; Roy Y. Yempuku, individually, and in his capacity as attorney for Pacific Loan and for Thrift Guaranty; Susan Ichinose, individually, and in her capacity as attorney for Pacific Loan and for Thrift Guaranty Corporation; Mary Bitterman, individually, and as Director of Regulatory Agencies for the State of Hawaii and in her capacity as head of the Bank Examiner Division of that body; Tany S. Hong, individually, and as former Director of the Department of Regulatory Agencies for the State of Hawaii and in his capacity as Attorney General for the State of Hawaii; Lester Wee, individually, and in his capacity as Bank Examiner for the State of Hawaii; Edward R. Lebb, individually, and in his capacity as Attorney for the Bank Examiner for the State of Hawaii; et al., Defendants-Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1310

827 F.2d 1310

Michael F. McCARTHY, Plaintiff-Appellant, v. Stephen A. MAYO, individually, and in his capacity as Special Deputy Attorney General for the State of Hawaii and as Special Assistant U.S. Attorney; William J. Eggers, III individually, and in his capacity as Special Deputy Attorney General for the State of Hawaii; Roy Y. Yempuku individually, and in his capacity as attorney for Pacific Loan and for Thrift Guaranty; Susan Ichinose, individually and in her capacity as attorney for Pacific Loan and for Thrift Guaranty Corporation; Mary Bitterman, individually and as Director of Regulatory Agencies for the State of Hawaii and in her capacity as head of the Bank Examiner Division of that body; Tany S. Hong, individually, and as former Director of the Department of Regulatory Agencies for the State of Hawaii and in his capacity as Attorney General for the State of Hawaii; Lester Wee, individually, and in his capacity as Bank Examiner for the State of Hawaii; Edward R. Lebb, individually, and in his capacity as Attorney for the Bank Examiner for the State of Hawaii; et al., Defendants-Appellees.

No. 86-2591.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted May 13, 1987.

Decided Sept. 14, 1987.

As Amended Oct. 30, 1987.

Peter A. Donahoe, Honolulu, Hawaii, for plaintiff-appellant.

Richard J. Archer, Steven S. Michaels and Linda M. Katsuki, Honolulu, Hawaii, for defendants-appellees.

Appeal from the United States District Court for the District of Hawaii.

Before SKOPIL, FARRIS and O'SCANNLAIN, Circuit Judges.

FARRIS, Circuit Judge:

Michael F. McCarthy appeals the district court's summary judgment and dismissal for failure to state a claim in favor of the numerous defendants to his civil rights action. He also appeals from the court's denial of his post-judgment motion to reconsider. We affirm.

BACKGROUND

McCarthy was an executive officer and investor in American Resources, Ltd., which developed land in Hawaii and Alaska. American Resources and its partner, Velzeyland, borrowed approximately six million dollars from Pacific Loan, for the alleged purpose of consolidating previous corporate and individual loans from Pacific Loan. Pacific Loan is an industrial loan company regulated by the State of Hawaii. It is required to belong to the Thrift Guaranty Corporation, which was created to stabilize the industrial loan industry and avoid the consequences of industrial loan company failures by guaranteeing payment of outstanding obligations. Thrift Guaranty has the authority to oversee the financial status of member companies.

In March 1981, American Resources transferred a real estate subdivision to Pacific Loan, which the latter apparently accepted in full satisfaction of a prior debt. In June 1981, the Hawaii Bank Examiner, through defendant Bitterman, directed Thrift Guaranty to take action regarding Pacific Loan's precarious financial condition. Thrift Guaranty took over the assets and management of Pacific Loan. By paying off claims against Pacific Loan, Thrift Guaranty assumed Pacific Loan's claims against its debtors. Because McCarthy and his associates had borrowed substantial sums from Pacific Loan, they were suspected of being responsible for Pacific Loan's financial collapse. This suspicion led to civil and criminal suits. Civil litigation resulted in a district court judgment that the transfer of property from Velzeyland and American Resources, Ltd. to Pacific Loan was illegal and did not satisfy the prior debt, which therefore remained due and owing.

Hawaii Special Deputy Attorneys General Mayo and Eggers brought the first criminal indictment against McCarthy. The indictment was dismissed because the statute of limitations had run. The Hawaii Supreme Court affirmed the dismissal. Defendant Mayo was then appointed Special Assistant United States Attorney and sought a federal grand jury indictment. Some of the counts were dismissed before trial, and McCarthy was acquitted of the others after the prosecution rested its case. See McCarthy v. Pacific Loan, Inc., 629 F.Supp. 1102, 1104 (D.Hawaii), appeal dismissed, 789 F.2d 921 (9th Cir.1986).

On February 14, 1986, McCarthy filed suit in federal court alleging violation of his constitutional and civil rights by numerous defendants. He contended that the criminal prosecutions constituted malicious prosecution. Motions by the defendants for summary judgment and dismissal caused McCarthy to move to amend his complaint. Those motions were argued in the same proceeding. The district court granted McCarthy leave to amend, and then granted summary judgment in favor of the state defendants because: the prosecutors had absolute immunity; Plotnick and Creative Resources, Inc. (private investigators) enjoyed qualified immunity to the extent that they were agents of the state; and the regulatory defendants enjoyed qualified immunity since there was no allegation that they acted beyond the scope of their discretion. The district court dismissed the action against the non-governmental defendants because the amended complaint failed to state a claim upon which relief could be granted under 42 U.S.C. Secs. 1983 and 1985 and failed to allege a claim for malicious prosecution. Three orders were signed by the district judge and filed on June 13, 1986. The judgment dismissing the case with prejudice was entered on June 17, 1986.

On June 19, 1986, McCarthy wrote a letter to the judge objecting to the form of the orders. The judge treated the letter as a motion for reconsideration pursuant to Rule 59(e). On July 9, 1986, McCarthy filed an amended motion to reconsider or in the alternative for relief under Rule 60(b) on the basis of new developments.

On July 31, 1986, the district court ordered the three previous orders stricken from the record as inappropriate and ruled that "[t]he reporter's transcript of the proceedings held on May 27, 1986, adequately sets forth the court's rulings and the bases for those rulings". McCarthy filed a timely notice of appeal on August 28, 1986.

DISCUSSION

1. Scope of Review, Standards of Review

Defendants contend that McCarthy's notice of appeal on August 28 brings before us only the district court's denial of his motions under Rule 60(b). They argue that the notice of appeal does not indicate clearly McCarthy's intent to appeal from the June 17 summary judgment and dismissal of claims. We reject this argument. ¹

A mistake in designating the order being appealed is not fatal "as long as the intent to appeal a specific judgment can be fairly inferred and the appellee is not prejudiced or misled by the mistake." United States v. One 1977 Mercedes Benz, 708 F.2d 444, 451 (9th Cir.1983), cert. denied, 464 U.S. 1071, 104 S.Ct. 981, 79 L.Ed.2d 217 (1984); see Foman v. Davis, 371 U.S. 178, 181, 83 S.Ct. 227, 229, 9 L.Ed.2d 222 (1962) (It violates the spirit of the Federal Rules of Civil Procedure to avoid a decision on the merits on the basis of mere technicalities.). It can be fairly inferred that McCarthy intended to challenge the original summary judgment and dismissal when he designated the denial of his post-judgment motions as the order being appealed. In denying McCarthy's post-judgment motion, the district court incorporated the prior order of summary judgment and dismissal: "The reporter's transcript of proceedings on May 27, 1986, adequately sets forth the Court's rulings and the bases for those rulings." See United States v. Walker, 601 F.2d 1051, 1058 (9th Cir.1979). McCarthy's opening brief addressed the propriety of the district court's initial ruling. See One 1977 Mercedes Benz, 708 F.2d at 451. The defendants cannot claim prejudice because they also fully briefed the issues. We therefore consider the merits of the initial judgment.

We review a summary judgment de novo, determining whether there is a genuine issue of material fact and whether the law was correctly applied. Fernhoff v. Tahoe Regional Planning Agency, 803 F.2d 979, 982 n. 2 (9th Cir.1986). We review de novo a dismissal under Rule 12(b). Mack v. South Bay Beer Distributors, Inc., 798 F.2d 1279, 1282 (9th Cir.1986). We review the denial of motions under Rules 59(e) and 60(b) for abuse of discretion. Federal Kemper Insurance Co. v. Rauscher, 807 F.2d 345 (3d Cir.1986) (Rule 59(e)); Browder v. Director, Dep't of Corrections, 434 U.S. 257, 263 n. 7, 98 S.Ct. 556, 560 n. 7, 54 L.Ed.2d 521 (1978) (Rule 60(b)); Swimmer v. IRS, 811 F.2d 1343, 1345 (9th Cir.1987) (Rules 59(e) and 60(b)).

2. Governmental Defendants

A. Prosecutors

The district court granted summary judgment in favor of Mayo and Eggers on the ground that, as prosecutors, they enjoyed absolute immunity from suit. McCarthy contends that this was error. They acted without authority, McCarthy argues, because their appointments as Special Deputy Attorneys General violated state and federal law. McCarthy also contends that public policy requires a bad faith exception to absolute prosecutorial immunity.

A prosecutor is entitled to absolute immunity for quasi-judicial actions taken within the scope of his authority. Imbler v. Pachtman, 424 U.S. 409, 96 S.Ct. 984, 47 L.Ed.2d 128 (1976); Ashelman v. Pope, 793 F.2d 1072, 1076 (9th Cir.1986) (en banc). To determine whether an act is quasi-judicial and whether it is within a prosecutor's authority, we look to the nature or function of the ultimate act. Ashelman, 793 F.2d at 1076-78; Ybarra v. Reno Thunderbird Mobile Home Village, 723 F.2d 675, 678 (9th Cir.1984); see also Lerwill v. Joslin, 712 F.2d 435 (10th Cir.1983) (Authority does not rest on technicalities of local law; the issue is whether the prosecutor is arguably empowered to perform the act).

McCarthy argues that the appointments of Mayo and Eggers as Special Deputy Attorneys General for the State of Hawaii violated the statutes providing for such appointments because they received too much compensation. He concludes that any actions they took were ipso facto...