Sanchez-Lopez v. Fuentes-Pujols

• Decision Date: 15 July 2004
• Docket Number: No. 03-1865.,No. 03-1866.,03-1865.,03-1866.
• Citation: 375 F.3d 121
• Parties: Alicia SANCHEZ-LOPEZ; Hector Santiago-Gonzalez; Conjugal Partnership Santiago-Velez; Elmer Sauri-Santiago; Eric Boneta-Marrero; Nelly Colon-Ortiz; Ivelisse Velez De Santiago, Plaintiffs, Appellees, v. Maria FUENTES-PUJOLS; Governmental Development Bank for Puerto Rico; Ada Diaz-Rivera, Defendants, Appellants.
• Court: U.S. Court of Appeals — First Circuit

375 F.3d 121

Alicia SANCHEZ-LOPEZ; Hector Santiago-Gonzalez; Conjugal Partnership Santiago-Velez; Elmer Sauri-Santiago; Eric Boneta-Marrero; Nelly Colon-Ortiz; Ivelisse Velez De Santiago, Plaintiffs, Appellees, v. Maria FUENTES-PUJOLS; Governmental Development Bank for Puerto Rico; Ada Diaz-Rivera, Defendants, Appellants.

No. 03-1865.

No. 03-1866.

United States Court of Appeals, First Circuit.

Heard April 7, 2004.

Decided July 15, 2004.

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Joan S. Peters, with whom Andrés Guillemard-Noble, Monique Guillemard-Noble, and Nachman & Guillemard were on brief, for appellees.

Enrique J. Mendoza Méndez, with whom Mendoza Law Offices was on brief, for the Governmental Development Bank and the individual appellants in their official capacities.

Carlos A. Del Valle Cruz, with whom Anabelle Rodriguez and Ivonne Palerm Cruz were on brief, for the individual appellants in their personal capacities.

Before LYNCH, Circuit Judge, LIPEZ, Circuit Judge, and GARCIA-GREGORY,^* District Judge.

LYNCH, Circuit Judge.

In this political discrimination case from Puerto Rico, six plaintiffs were awarded a jury verdict in the total sum of $646,000, plus reinstatement, costs, and attorneys fees. We vacate the verdict and remand.

The appeal involves both the First Amendment prohibition on discrimination based on political affiliation, Elrod v. Burns, 427 U.S. 347, 96 S.Ct. 2673, 49 L.Ed.2d 547 (1976), and the Mt. Healthy defense available to government employers, Mt. Healthy City Sch. Dist. Bd. of Educ. v. Doyle, 429 U.S. 274, 97 S.Ct. 568, 50 L.Ed.2d 471 (1977). The Supreme Court's decision in Mt. Healthy established that even if a plaintiff can demonstrate that her political affiliation was a substantial factor in the adverse employment action taken against her, there is no constitutional violation if the defendant can show both (i) that it would have taken the same action in any event, and (ii) that it would have taken that action for reasons that are not unconstitutional. See Mt. Healthy, 429 U.S. at 286-87, 97 S.Ct. 568. In other words, it is not true that all a plaintiff needs to show in order to win is that political discrimination was a motivating reason for the employment action. The fact that the constitutionally protected activity played a substantial part in the actual decision to take adverse employment action does not necessarily amount to a constitutional violation. Id.

The two distinct questions composing the Mt. Healthy defense must be answered before a finder of fact may determine that political discrimination was the ultimate "but for" cause of an adverse employment action. In this case, a misapprehension of the Mt. Healthy defense led to an error in the jury form and instructions. There is a sufficient likelihood of jury confusion from those errors that we vacate the judgment for plaintiffs and remand.

I.

Puerto Rico has two major political parties that dominate the electoral landscape: the Popular Democratic Party (PDP) and the New Progressive Party (NPP). Control of the government periodically switches between the two parties. Entirely too often, the political party assuming office terminates the employment of public employees who are affiliated with the party going out of power and then fills those vacancies with its own members. By the same token, the outgoing party attempts to secure the continued tenure of its members in public jobs through a variety of devices, such as reclassifying policy-type appointments as career positions or making appointments in violation of Puerto Rico law.

In 1976, the United States Supreme Court held that public employees have a First Amendment right not to lose their jobs because of their political affiliation, unless political affiliation is an appropriate requirement for the effective performance of the position involved. Elrod, 427 U.S. at 372-73, 96 S.Ct. 2673; see also Cordero v. De Jesus-Mendez, 867 F.2d 1, 9 (1st Cir.1989). That doctrine has been refined over the years. In Branti v. Finkel, 445 U.S. 507, 100 S.Ct. 1287, 63 L.Ed.2d 574 (1980), for example, the Court held that an employee need not prove that he or she was coerced into changing political affiliation in order to prevail under the First Amendment. Id. at 517, 100 S.Ct. 1287. In Rutan v. Republican Party of Ill., 497 U.S. 62, 110 S.Ct. 2729, 111 L.Ed.2d 52 (1990), the Court defined the scope of employment decisions subject to scrutiny to include promotion, transfer, recall, hiring, and firing. Id. at 78, 110 S.Ct. 2729. And in O'Hare Truck Serv., Inc. v. City of Northlake, 518 U.S. 712, 116 S.Ct. 2353, 135 L.Ed.2d 874 (1996), the Court extended the protections of Elrod and Branti to contractors and regular providers of services to the government. Id. at 726, 116 S.Ct. 2353.

In the original political discrimination cases, Branti and Elrod, there were already findings that the employment decisions at issue were made on political patronage grounds. See Branti, 445 U.S. at 510, 100 S.Ct. 1287; Elrod, 427 U.S. at 351, 96 S.Ct. 2673. The initial issue presented by those cases was whether historic patronage practices violated the First Amendment at all. See Elrod, 427 U.S. at 353-54, 96 S.Ct. 2673. The next set of issues concerned whether a plaintiff needed to show that there had been coercion to change political affiliation, see Branti, 445 U.S. at 517, 100 S.Ct. 1287, and what types of jobs and job changes (e.g., reappointment) could give rise to claims, see Rutan, 497 U.S. at 68-69, 110 S.Ct. 2729. Rutan presented the question whether a First Amendment claim was stated where a governor had imposed an across-the-board hiring freeze but had given his "express permission" for exceptions to the freeze only for members of his own party, thus denying hiring, promotion, transfer, and recall to applicants who were members of other parties. 497 U.S. at 65-66, 110 S.Ct. 2729. A majority of the Court held that a First Amendment claim was indeed stated on those facts. Id. at 78, 110 S.Ct. 2729. For present purposes, it is important that Rutan did not involve the uniform application of a neutral employment policy, but rather the selective application of exceptions according to political party affiliation. See id. at 66, 110 S.Ct. 2729.

To the best of our knowledge, the Supreme Court has never addressed the question whether a political discrimination claim may be pursued where the new party in power uniformly applies a personnel practice to all employees — such as by reviewing all personnel actions taken during a certain period to determine whether those actions conformed to local law and undoing them in every case in which there was a violation.

Despite the thirty years since Elrod, administrations in Puerto Rico have continued to take employment actions against public employees because of their political affiliations. With each change in administration — at both the commonwealth and municipal levels — the federal district courts in Puerto Rico are flooded with hundreds of political discrimination cases, many of which are appealed. See, e.g., Gomez v. Rivera Rodriguez, 344 F.3d 103 (1st Cir.2003) (claims by 24 NPP members who were fired from municipal jobs after the PDP won the 2000 mayoral election in Gurabo); Acevedo-Garcia v. Vera-Monroig, 351 F.3d 547 (1st Cir.2003) (claims by 82 NPP members who were fired from municipal jobs after the PDP assumed power following the 1996 mayoral election in Adjuntas); Acosta-Orozco v. Rodriguez-de-Rivera, 132 F.3d 97 (1st Cir.1997) (claims by six PDP members who were fired after the NPP won the 1992 general election); Kauffman v. P.R. Tel. Co., 841 F.2d 1169 (1st Cir.1988) (claims by ten NPP members who were fired after the PDP won the 1984 general election). The practice is so pervasive that jury awards in cases of political discrimination threaten to bankrupt local governments in Puerto Rico. See Acevedo-Garcia v. Vera-Monroig, 368 F.3d 49, 55 n. 7 (1st Cir.2004) (verdict exceeded town budget). And yet the culture of political discrimination continues.

II.

The most recent series of political discrimination cases to reach this court arose out of the 2000 general elections, in which the PDP prevailed over the NPP at the commonwealth level. As a result of the 2000 elections, defendant Puerto Rico Government Development Bank (the "Bank") came under the control of the PDP, and the Bank's NPP board members were replaced with PDP board members. Defendant Maria Fuentes-Pujols ("Fuentes") was appointed the new president of the Bank and, according to plaintiffs, defendant Ada Díaz-Rivera ("Diaz") constructively functioned as the new director of human resources of the Bank.

Under Puerto Rico law, there is a period of time, called the electoral moratorium period ("veda electoral"), during which no "movement[s] of personnel" are to take place absent emergencies. See 3 P.R. Laws Ann. § 1337. The moratorium period comprises the two months preceding and the two months following a general election.¹ Id. The law was enacted "[f]or the purpose of guaranteeing the faithful application of the merit principle in public service during the period before and after elections." Id.

In early 2001, the newly-appointed Fuentes decided to review all personnel actions taken by the former Bank regime between August 1, 2000 (one month prior to the beginning of the electoral moratorium) and the elections in November 2000. For purposes of this opinion, we will simply refer to that period as the "review period." Fuentes hired an outside consulting firm called Applied Management Consulting, Inc. to perform the review, and a consultant named Ana Bonet conducted the audit. A total of twenty-three personnel actions had taken place during the review period, and Bonet's audit determined that all twenty-three were in violation of the Bank's personnel regulations.

The outside audit revealed that the positions of director of human resources and director of...