Shannon v. Bepko

• Decision Date: 14 March 1988
• Docket Number: No. IP 87-327-C.,IP 87-327-C.
• Citation: 684 F. Supp. 1465
• Parties: Johnathan SHANNON, Plaintiff, v. Gerald L. BEPKO, In His Official Capacity as Vice-President of Indiana University-Purdue University at Indianapolis (IUPUI), G. Chris Keeley, In Her Official Capacity as Director of the Personnel Department of Indiana University-Purdue University at Indianapolis (IUPUI), Theresa S. Martin, In Her Official Capacity as Labor Relations Representative of Indiana University-Purdue University at Indianapolis (IUPUI), Clyde V. McAdams, In His Official Capacity as Manager of Stock Division of IUPUI-IU Medical Center, Defendants.
• Court: U.S. District Court — Southern District of Indiana

684 F. Supp. 1465

Johnathan SHANNON, Plaintiff, v. Gerald L. BEPKO, In His Official Capacity as Vice-President of Indiana University-Purdue University at Indianapolis (IUPUI), G. Chris Keeley, In Her Official Capacity as Director of the Personnel Department of Indiana University-Purdue University at Indianapolis (IUPUI), Theresa S. Martin, In Her Official Capacity as Labor Relations Representative of Indiana University-Purdue University at Indianapolis (IUPUI), Clyde V. McAdams, In His Official Capacity as Manager of Stock Division of IUPUI-IU Medical Center, Defendants.

No. IP 87-327-C.

United States District Court, S.D. Indiana, Indianapolis Division.

March 14, 1988.

COPYRIGHT MATERIAL OMITTED

David J. Dreyer, Krieg DeVault Alexander & Capehart, Indianapolis, Ind., for plaintiff.

Albert J. Velasquez, Associate University Counsel, Bloomington, Ind., for defendants.

ENTRY

BARKER, District Judge.

This case requires the court to address a basic question of constitutional law, a question that has apparently remained unanswered (at least unanswered in any published opinion) in both the state and federal courts of Indiana. Specifically, this court is asked to determine whether Indiana University — and in turn Indiana University-Purdue University at Indianapolis — share in the sovereign immunity of the state of Indiana under the Eleventh Amendment. Furthermore, this case necessitates that the court examine the far more familiar, but no less important issue of the scope and requirements of due process.

I. BACKGROUND

There is little, if any, dispute about the relevant facts in this case.¹ On April 24, 1974, Indiana University-Purdue University at Indianapolis (IUPUI) hired the plaintiff Johnathan Shannon for an indefinite term as an hourly employee. By June 9, 1986, Mr. Shannon was working as an evening shift supervisor in the Materials Management Department, Stock Division. On June 10, 1986, the defendant Clyde V. McAdams, Manager of I.U. Medical Center's stock division, handed Mr. Shannon a letter informing him that he was suspended from work subject to termination. Mr. McAdams also gave the plaintiff a copy of a signed memorandum that had been written by Mr. McAdams. In that memorandum Mr. McAdams included a narrative of the facts and circumstances regarding Mr. Shannon's employment that concluded with the following sentence: "I am therefore recommending that Jonathan Shannon be suspended for a period of five (5) days beginning June 10, 1986, for just cause." That same day Mr. McAdams and an individual not a party to this suit, Mr. John Bleu, met personally with Mr. Shannon, explained to him the reason for his suspension, and advised him that within five days he would be informed as to whether he would be permitted to return to work. The next day, after consulation between Mr. McAdams, Frank Davis, and the defendant Theresa Martin, a termination letter dated June 11, 1986, was sent to Mr. Shannon. The letter stated that Mr. Shannon was being terminated "in accordance with Personnel Policy Section 30-B, `Immediate Suspension Pending Discharge for Just Cause'...." Parties' Joint Statement, Exhibit C. In its relevant portion Policy 30-B states:

An employee may be suspended without advance notice and without pay subject to discharge without further notice at the end of five workdays of suspension for just cause.

Parties' Joint Statement, Exhibit A.

Mr. McAdams has testified under oath that the sole "just cause" for Mr. Shannon's termination was the "falsifying of a University document." Apparently, on June 7, 1986, Mr. Shannon wrote on his time sheet that he had worked from 3:00 p.m. until 11:00 p.m. when in fact he had only worked from 3:00 p.m. to 6:00 p.m. Mr. Shannon has testified that the discrepancy was simply an "honest mistake." He alleges that he wrote all of his hours down on his time sheet when he first arrived for work and that, when he was later unexpectedly required to leave early, he simply forgot to correct his time sheet to reflect the shortened hours he had actually worked. Plaintiff's Brief in Support of Motion for Summary Judgment Plaintiff's Brief in Support at 11. Mr. McAdams did not accept Mr. Shannon's allegation of an "honest mistake" and took the problem to the personnel department. According to Mr. McAdams, the personnel department stated that, as far as they were concerned, allegedly falsifying a University document was enough to justify an immediate discharge pursuant to Policy 30-B.

On April 2, 1987, Mr. Shannon filed suit in federal district court alleging that his termination "without any kind of pre-deprivation hearing, adequate appeal opportunity, or just cause" violated his Fourteenth Amendment right to due process. Complaint at 5. As relief, Mr. Shannon sought reinstatement, back pay, attorneys fees, and $1.5 million in damages for violation of his constitutional rights. The complaint named four defendants, each of whom is being sued solely in his or her official capacity as a university employee.² The parties have now filed cross-motions for summary judgment. The plaintiff argues that as a matter of law he had a protectible property interest in his continued employment with IUPUI and that, therefore, his dismissal without any form of predeprivation hearing was a clear violation of his procedural due process rights. Plaintiff's Brief in Support at 3-8. Furthermore, he urges that the undisputed facts show that the defendants violated his substantive due process rights by arbitrarily dismissing him in a manner that lacked both a rational basis and fundamental fairness. Id. at 9-12. The defendants counter the plaintiff's arguments by asserting that they are in fact entitled to summary judgment in their favor. They argue that Mr. Shannon's claim is not actionable because the Eleventh Amendment bars claims against the named defendants in their official capacities. If this court finds that the action is not barred, they assert that as a matter of law Mr. Shannon had no protectible property interest in his continued employment— and that, even if he did, he was given all the pretermination procedure he was due. Defendants' Memorandum in Support of Their Corss-Motion for Summary Judgment Defendants' Memorandum in Support at 1-2. The plaintiff in turn replies that Eleventh Amendment immunity does not apply to the defendants and that, even if it does, it would not bar his equitable claims for reinstatement, attorneys' fees, and back pay. Plaintiff's Reply to Defendant's Memorandum in Support of Cross-Motion for Summary Judgment Plaintiff's Reply at 6-11.

II. ELEVENTH AMENDMENT IMMUNITY

Because a finding of complete immunity would obviate the need for the court to further address the substance of the plaintiff's claims, the court turns first to the Eleventh Amendment issue. The defendants' immunity argument basically pivots around their assertion that, because Indiana University is an "alter ego" of the state of Indiana, the university's officials are immune from suit for money damages by virtue of the Eleventh Amendment. The plaintiff questions, however, whether Indiana University and IUPUI are entitled to share in the state's Eleventh Amendment immunity.³ Furthermore, he argues, Congress overrode the state's immunity by enacting 42 U.S.C. § 1983. Even assuming the Eleventh Amendment fully applies to the defendants, the plaintiff asserts that those of his claims that are equitable must survive.

These various arguments in fact raise three distinct subsidiary issues which must be addressed separately in order for the court to make a determination of the Eleventh Amendment's impact on this case. First, this court must determine whether Indiana University and IUPUI are entitled to assert Eleventh Amendment immunity at all — for if they are not, the court must then turn directly to the substance of the plaintiff's claims. If the universities generally do enjoy Eleventh Amendment immunity, the second question must be whether or not that immunity has been waived for the purpose of section 1983 claims. Third, if the immunity has not been waived, the court must determine which of the plaintiff's claims are barred by that immunity and which of the claims survive.

A. The Applicability of the Eleventh Amendment to Indiana University and IUPUI

The Eleventh Amendment to the Constitution of the United States declares:

The Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State.

Despite the express language of the Amendment, the Supreme Court has consistently held that the Eleventh Amendment also grants to states immunity from suits in federal court when their own citizens are plaintiffs. Lincoln County v. Luning, 133 U.S. 529, 10 S.Ct. 363, 33 L.Ed. 766 (1890); Quern v. Jordan, 440 U.S. 332, 99 S.Ct. 1139, 59 L.Ed.2d 358 (1979). Thus, "as the Amendment has been construed, it prohibits suit against a state by a citizen of another state, a citizen of the state itself, or an alien, except where the state has consented to suit."⁴ C. Wright, Law of Federal Courts § 109 at 767-68 (1983). As a general matter, Indiana has not waived its immunity. See Ind. Code § 34-4-16.5-5(d).

In determining whether an entity is an "alter ego" of the state for Eleventh Amendment purposes, state law should be given primary consideration. See Wellman v. Trustees of Purdue University, 581 F.Supp. 1228, 1229 (N.D.Ind.1984) (citing Mount Healthy City School District v. Doyle, 429 U.S. 274, 97 S.Ct. 568, 50 L.Ed. 2d 471 (1977)). The ultimate determination, however, clearly raises a question of federal law. See Miller-Davis Co. v. Illinois State Toll Highway Authority, 567 F.2d 323, 330 (7th Cir.1977) (noting that a "state would have too much self-interest in extending sovereign immunity to as many of its agencies and corporate creations...