Moran v. State of Wash.

• Citation: 147 F.3d 839
• Decision Date: 02 June 1998
• Docket Number: No. 96-36129,96-36129
• Parties: 13 IER Cases 1845, 98 Cal. Daily Op. Serv. 4158, 98 Daily Journal D.A.R. 5755 Nickie Larelle MORAN, Plaintiff-Appellee, v. STATE OF WASHINGTON; Deborah Senn, Individually and in Her Capacity as State Insurance Commissioner; and Krishna Fells, Individually and in Her Capacity as Chief of Staff, Defendants-Appellants.
• Court: United States Courts of Appeals. United States Court of Appeals (9th Circuit)

Page 839

147 F.3d 839

13 IER Cases 1845, 98 Cal. Daily Op. Serv. 4158,

98 Daily Journal D.A.R. 5755

Nickie Larelle MORAN, Plaintiff-Appellee, v. STATE OF WASHINGTON; Deborah Senn, Individually and in Her

Capacity as State Insurance Commissioner; and

Krishna Fells, Individually and in Her

Capacity as Chief of Staff,

Defendants-Appellants.

No. 96-36129.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Nov. 6, 1997.

Decided June 2, 1998.

Michael P. Lynch, Office of Atty. Gen., Tort Claims Division, Olympia, WA, for appellants.

Paul Lindenmuth, Law Offices of Neil J. Hoff, Tacoma, WA, for appellee.

Appeal from the United States District Court for the Western District of Washington Franklin D. Burgess, District Judge, Presiding. D.C. No. 96-5050-FDB.

Before: FLETCHER and O'SCANNLAIN, Circuit Judges, and SCHWARZER, District Judge. ^*

O'SCANNLAIN, Circuit Judge:

We must decide, on appeal from denial of summary judgment, whether a state agency head may discharge a subordinate who refuses to carry out official agency policy without subjecting herself to the risk of personal liability for breach of constitutional rights.

I

Deborah Senn was elected to the office of Washington State Insurance Commissioner in November 1992. During her campaign, Senn had advocated the expansion of consumer "outreach" and education programs conducted by the Office of the Insurance Commissioner ("OIC"). To that end, in August 1993, she hired Nickie Moran as Deputy Commissioner for Consumer Advocacy and Outreach. ¹

In her capacity as Deputy Commissioner, Moran supervised a staff of more than twenty individuals in two cities, Seattle and Olympia, and reported directly to Krishna Fells, Senn's Chief of Staff. ² As one of her primary duties, Moran was responsible for developing and implementing an "outreach" program for the OIC aimed, according to Senn, at informing and educating Washington citizens regarding insurance matters. The outreach effort envisioned by Senn involved, inter alia, the following activities: setting up informational tables in city halls around Washington; canvassing malls and attending fairs throughout the State and distributing brochures regarding the OIC; participating in local parades; speaking at community groups and organizations about insurance-related issues; sending OIC staff to the sites of natural disasters such as floods, earthquakes, and fires; and obtaining broadcast time on local radio stations to discuss OIC programs. Consumer outreach was, in Moran's own words, a "central theme" of Senn's vision for the OIC--an item "at the top of Senn's agenda."

Senn contends that, despite her position as Deputy Commissioner for Consumer Advocacy and Outreach, Moran insubordinately opposed the development and implementation of the outreach plan. Indeed, Moran's own complaint and declaration frankly confess her opposition to the outreach program, at least as conceived by Senn. Moran believed that the outreach program constituted "unlawful political activity" intended for "Senn's political gain," and, for that reason, she "continually resisted and refused to engage" in outreach activity. She also feared that the proposed expansion of outreach activity would unnecessarily drain Consumer Advocacy and Outreach Division resources, and thus detract from what she viewed as her office's primary responsibility, the servicing of individual consumer complaints. Moran therefore "settled on a strategy of continuing to try to persuade [Senn] that [expanded outreach] would negatively impact productivity." She "reminded and emphasized to" Senn that she believed that the proposed outreach program would be counterproductive. Moran candidly questioned "the logic" of the plan, and cautioned Senn that the proposed shift in focus would "use awfully expensive staff to hand out materials." Despite her knowledge of Senn's "plans to move forward with outreach activities," Moran "continued to object" to the proposal to reallocate 20% of OIC compliance officers' time to outreach activities, and openly discussed her concerns over "productivity and ethical issues" surrounding the outreach program with her co-workers, most of whom adamantly opposed the expansion of outreach activity.

On March 3, 1995, Senn dismissed Moran effective March 17, 1995. She cited a "clear difference in management philosophy" as the reason for Moran's termination.

Moran filed suit in the United States District Court for the Western District of Washington, claiming that Senn had violated her right to free speech protected by the First and Fourteenth Amendments, and that both Senn and the State of Washington were liable under state law for wrongful termination, either intentional or negligent infliction of emotional distress, and the tort of outrage. On May 20, 1996, the district court dismissed all of Moran's state law claims. In its order, the court also ruled that the outreach program did not, contrary to Moran's initial accusations, constitute illegal campaign activity under Washington state law:

During Plaintiff's employment, the Commissioner had not announced her future candidacy for any office, and there are no allegations that Defendants solicited votes or money. Moreover, the Commissioner is under a duty to educate the public about insurance issues. RCW 48.02.160 requires that the Insurance Commissioner disseminate information concerning the insurance laws of the state and provide assistance to the public in obtaining information about insurance products and in resolving complaints involving insurers and other licensees.

Order Granting Motion to Dismiss State Law Claims at 3, Moran v. State of Washington, No. C96-5050-FDB (W.D.Wash. May 20, 1996). ³

Senn then moved for summary judgment both on the merits of Moran's First Amendment claim and on the basis of qualified immunity. The district court deemed it "inappropriate" to consider the merits in light of the discovery stay that it had imposed pending the resolution of the qualified immunity issue. The court did, however, address what it termed the "purely legal" issue of qualified immunity. On that score, the district court held:

Plaintiff Moran spoke about issues of public importance with Defendants Senn and Fells and such speech may not furnish the basis for her dismissal. Dismissal based upon protected speech is impermissible. The contours of that right are sufficiently clear that a reasonable official would understand that termination for exercise of that right would be unlawful.

In concluding that Moran possessed a "clearly established" right to speak, a violation of which would give rise to personal liability, the district court, in accordance with the Supreme Court's decision in Pickering v. Board of Education, 391 U.S. 563, 88 S.Ct. 1731, 20 L.Ed.2d 811 (1968), stated that it would balance Moran's right to criticize OIC initiatives against the State's interest in office efficiency. It acknowledged Senn's contention that Moran's "insubordinate refusal to carry out [her] instructions was disruptive to the expansion of outreach activity." The court, however, explicitly refused to consider Senn's argument, concluding that "[i]t would be illogical to hold Plaintiff's failure to implement the Defendants' proposed outreach plan as disruptive because the proposed program was the very subject of Plaintiff's protected speech." The district court thus rejected Senn's claim of qualified immunity and denied her motion for summary judgment.

This appeal ensued. Senn argues that the district court erred in refusing to consider in its Pickering balancing Moran's disruption of the implementation of the outreach program. Correctly applied, she contends, "the outcome of the Pickering test is either in the State's favor, or so uncertain as not to be clearly established and therefore the defendants are entitled to qualified immunity as a matter of law."

II

In Mitchell v. Forsyth, 472 U.S. 511, 105 S.Ct. 2806, 86 L.Ed.2d 411 (1985), the Supreme Court established that a district court's denial of summary judgment on a claim of qualified immunity is subject to immediate appeal under 28 U.S.C. § 1291 pursuant to the so-called "collateral order" doctrine of Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 69 S.Ct. 1221, 93 L.Ed. 1528 (1949). The scope of appellate jurisdiction in such a case, however, is limited. In Mitchell, the Supreme Court held that a public-official defendant may appeal the "purely legal" issue "whether the facts alleged (by the plaintiff, or, in some cases, the defendant) support a claim of clearly established law." Id. at 528 n. 9. A defendant may not, however, "appeal a district court's summary judgment order insofar as that order determines whether or not the pretrial record sets forth a 'genuine' issue of fact for trial." Johnson v. Jones, 515 U.S. 304, 319-20, 115 S.Ct. 2151, 132 L.Ed.2d 238 (1995). In other words, "we have jurisdiction to review the district court's decision that defendants' alleged conduct violated clearly established law, but the collateral order doctrine does not provide appellate jurisdiction to review the district court's decision that material issues of fact exist for trial." Armendariz v. Penman, 75 F.3d 1311, 1317 (9th Cir.1996) (en banc).

Moran argues that, under Johnson, we are without jurisdiction over Senn's appeal, because the district court concluded in its decision that genuine issues of material fact exist, and because this court may not pass upon "the factual question of whether or not the district court made the appropriate determination on summary judgment as to the existence of disputes (sic) issues of fact for trial." Moran appears, however, to have misapprehended the nature of Senn's challenge. Senn does not dispute the district court's conclusion that genuine issues of fact exist. She is not before this court claiming, as were the defendants in Johnson, that there is insufficient evidence in the record to provide Moran...