Román v. Colegio De Abogados De P.R.

• Decision Date: 23 July 2010
• Docket Number: No. 08-2432.,08-2432.
• Citation: 613 F.3d 44
• Parties: Herbert W. BROWN III; José L. Ubarri; David W. Román, Plaintiffs, Appellees, v. COLEGIO DE ABOGADOS DE PUERTO RICO, Defendant, Appellant.
• Court: U.S. Court of Appeals — First Circuit

613 F.3d 44

Herbert W. BROWN III; José L. Ubarri; David W. Román, Plaintiffs, Appellees,

v.COLEGIO DE ABOGADOS DE PUERTO RICO, Defendant, Appellant.

No. 08-2432.

United States Court of Appeals,First Circuit.

Heard May 3, 2010.

Decided July 23, 2010.

COPYRIGHT MATERIAL OMITTED.

Harold D. Vicente with whom Nelson N. Cordova-Morales and Vicente & Cuebas were on brief for appellant.

David C. Indiano with whom Seth A. Erbe, María Ligia Giráldez, Indiano & Williams, P.S.C., Andrés W. López and The Law Offices of Andrés W. López were on brief for appellees.

Before LYNCH, Chief Judge, BOUDIN and LIPEZ, Circuit Judges.

BOUDIN, Circuit Judge.

Colegio de Abogados de Puerto Rico (“Colegio”) is a state-created, integrated bar association; membership has been statutorily required in order to practice law before the Commonwealth of Puerto Rico's courts. P.R. Laws Ann. tit. 4, § 774 (2009). At the time the present dispute began, Colegio had for many years provided compulsory life insurance to its members, funded by a portion of their annual dues. The present appeal is the latest phase of litigation stemming from this compulsory insurance.

The procedural history traces back to a law suit filed in 1994. Carlos Romero, Jr., a Colegio member, claimed that the organization was acting unlawfully by requiring him to purchase life insurance in order to practice before Puerto Rican courts. The district court granted summary judgment in Colegio's favor and dismissed the claim in 1999 but was reversed on appeal by this court. Romero v. Colegio de Abogados de Puerto Rico, 204 F.3d 291, 295-96, 304-06 (1st Cir.2000).

This court held that the First Amendment allowed Colegio to compel its members to purchase life insurance only if this was germane to the purposes that justify compelling membership in an integrated bar association, id. at 302; but, to avoid needlessly deciding a constitutional question, we directed the district court to certify the question of Colegio's authority, id. at 305-06. The Puerto Rico Supreme Court affirmed that authority as a matter of local law. The district court then held that the life insurance program was not germane and was therefore unconstitutional, awarded Romero damages-the amount of his dues attributable to the life insurance program since he had initially objected-and entered an injunction “prohibit[ing] [Colegio] from collecting ... that portion of his future annual dues attributable to the Colegio's mandatory group life insurance program.” Romero v. Colegio de Abogados de Puerto Rico, No. 94-2503, slip op. at 9, 14-16 (D.P.R. Sept. 26, 2002).

Despite the injunction, Colegio continued to provide life insurance funded by its members' annual dues after the district court's decision became final, and although mentioning the decision in its 2003 and 2004 Treasurer's Reports, did not otherwise advise its members that insurance need no longer be purchased. In late 2005 and early 2006, two groups of attorneys requested and received reimbursements for those dues attributable to their life insurance coverage, but only after much delay by Colegio. ¹

The named plaintiffs in this law suit are Colegio members who neither objected to their participation in Colegio's life insurance program nor requested reimbursement. They filed this class action on June 27, 2006, requesting declaratory judgment and an injunction forbidding Colegio from charging its members for life insurance; the complaint was later amended to add a claim for damages reflecting forced participation in the program between the 2002 Romero decision and the time the program was eventually canceled. The plaintiffs sought to certify two classes, one for damages and another for declaratory relief, and moved for summary judgment, arguing that Romero had preclusive effect.

Colegio ended its life insurance program on August 29, 2006, and then filed a motion to dismiss, arguing that the case was now moot. The district court denied its motion, finding that “Colegio's prior pattern of contradictory behavior [left] the Court with no assurance that the alleged constitutional violations [would] not recur.” On July 31, 2008, the court certified both of the requested classes: a declaratory class encompassing all present and future Colegio members, and a damages class consisting of attorneys who were members between the conclusion of the Romero litigation in 2002 and the ending of the life insurance program in 2006.

Not long afterwards, the district court granted summary judgment for the plaintiffs, finding (based on non-mutual offensive collateral estoppel ² ) that Colegio's compulsory life insurance program violated the federal constitution. The court then issued a permanent injunction barring Colegio from using its members' annual dues for purposes of operating the compulsory life insurance program, later amending its judgment to add damages in the amount of $4,156,988.70, plus costs, interest and attorneys' fees. Colegio now appeals.

Colegio's jurisdictional objection, which we consider first, is that the case is moot because, after this law suit began, it ceased to offer life insurance. See Iron Arrow Honor Soc'y v. Heckler, 464 U.S. 67, 70, 104 S.Ct. 373, 78 L.Ed.2d 58 (1983) (“Federal courts lack jurisdiction to decide moot cases....”); County of Los Angeles v. Davis, 440 U.S. 625, 631, 99 S.Ct. 1379, 59 L.Ed.2d 642 (1979). The district court found that it was “not ‘absolutely clear’ that the Colegio [would] permanently enforce its internal decision to eliminate the compulsory life insurance component from the annual dues collection.”

The substantive standard for mootness is variously expressed in the cases; behavior certain not to recur ought not be enjoined, Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 189, 120 S.Ct. 693, 145 L.Ed.2d 610 (2000), but absent such certainty, likelihood of reoccurrence might not be the only factor to be considered. E.g., Horizon Bank & Trust Co. v. Massachusetts, 391 F.3d 48, 54 (1st Cir.2004)(ability of a harm to evade review). As for the standard of appellate review, some cases speak of de novo review without qualification although conceivably factual findings might deserve some deference. ³ [3] We need not resolve these issues because, even if review were entirely de novo and confined purely to risk of repetition, the district court's conclusion is sound. Indeed, as a general rule of thumb, a defendant may not render a case moot by voluntarily ceasing the activity of which the plaintiff complains; were the opposite true, a defendant could immunize itself from suit by altering its behavior so as to secure a dismissal, and then immediately reinstate the challenged conduct afterwards. See City of Mesquite v. Aladdin's Castle, Inc., 455 U.S. 283, 289, 102 S.Ct. 1070, 71 L.Ed.2d 152 (1982); United States v. W.T. Grant Co., 345 U.S. 629, 632, 73 S.Ct. 894, 97 L.Ed. 1303 (1953).

Nevertheless, a case may become moot if the defendant meets the “heavy burden” of showing that it is “absolutely clear that the allegedly wrongful behavior could not reasonably be expected to recur.” Friends of the Earth, Inc., 528 U.S. at 189, 120 S.Ct. 693 (quoting United States v. Concentrated Phosphate Export Ass'n, 393 U.S. 199, 203, 89 S.Ct. 361, 21 L.Ed.2d 344 (1968)); see also Adams, 313 F.3d at 613. But Colegio's past obstinacy and its own claims that one board's action does not bind the next (see note 1, above) justify a fear of repetition.

After Romero, Colegio did not fully advise its members that they no longer had to buy insurance, threw obstacles in front of those trying to opt out, and delayed refunds. In fact it moved to disbar one member who refused to pay the portion of his dues attributable to the program, see In re Rivera, No. TS-9645, 2006 WL 3782863 (P.R. Nov. 14, 2006). This sorry record answers the claim of mootness and also defeats any claim that the district court abused its discretion on the separate issue of whether as a matter of discretion an injunction was warranted.

In a related argument against the injunction, Colegio says that it was wrongly granted because there was no irreparable harm, ordinarily a requirement for such relief. See eBay Inc. v. MercExchange, L.L.C., 547 U.S. 388, 391, 126 S.Ct. 1837, 164 L.Ed.2d 641 (2006). In particular, Colegio claims that the damages are quantifiable and hence not “irreparable,” and that the plaintiffs suffered no injuries because they received the benefit of the life insurance policy and because objectors were ultimately reimbursed. The first part of the argument is readily disposed of; the second part is complicated.

When a preliminary injunction is sought, the merits are often an open question and, where it is clear that damages are easily determined, this may well counsel against injunctive relief. But where the merits have been determined and repetition is a risk, it is fanciful to argue that a vast number of members should be relegated to bringing law suits-possibly every year based on Colegio's notion that one board does not bind another. This is sufficient without even considering the relevance of First Amendment rights. ⁴ Colegio now claims in its brief that the Puerto Rico legislature has recently enacted a law converting Colegio into a voluntary bar association. Depending on Colegio's new status-most importantly, whether it is truly voluntary-it may no longer be prohibited by Romero from operating a mandatory life insurance program. But there is nothing in record about such matters. On remand, Colegio is free to ask the district court to consider them and seek dismissal of the injunctive element of the relief granted on the ground that it is no longer appropriate.

This brings us to damages. The district court granted class certification-relevant primarily to damages since an injunction and declaratory judgment could have been granted to any named plaintiff-and ultimately awarded large damages to the class....