Shinault v. Hawks

• Decision Date: 22 January 2015
• Docket Number: No. 13–35290.,13–35290.
• Citation: 782 F.3d 1053
• Parties: Lester R. SHINAULT, Plaintiff–Appellant, v. Dick HAWKS; Tami Dohrman; Martha McDaniel; Oregon Department of Corrections General Service Division, Defendants–Appellees.
• Court: U.S. Court of Appeals — Ninth Circuit

782 F.3d 1053

Lester R. SHINAULT, Plaintiff–Appellant

v.Dick HAWKS; Tami Dohrman; Martha McDaniel; Oregon Department of Corrections General Service Division, Defendants–Appellees.

No. 13–35290.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted Dec. 8, 2014.

Filed Jan. 22, 2015.

Amended April 6, 2015.

Daniel H. Bookin and Anna–Rose Mathieson (argued), O'Melveny & Myers LLP, San Francisco, CA, Pro Bono Counsel for Plaintiff–Appellant.

Ellen F. Rosenblum, Attorney General, Anna M. Joyce, Solicitor General, Peenesh H. Shah (argued), Assistant Attorney General, Salem, OR, for Defendants–Appellees.

Appeal from the United States District Court for the District of Oregon, Anna J. Brown, District Judge, Presiding. D.C. No. 3:11–cv–00436–PK.

Before: MICHAEL DALY HAWKINS, M. MARGARET McKEOWN, and RICHARD C. TALLMAN, Circuit Judges.

ORDER

The opinion filed on January 22, 2015, and published at 776 F.3d 1027, is hereby amended as follows:

On page 1032, the following text should be placed in a new footnote inserted after the words :

Our holding is of course limited to circumstances in which the government's interest arises from recouping incarceration costs. We need not and do not decide here whether, or when, a pre-deprivation hearing is required when the state's action is motivated by concerns other than those at stake when the government is seeking to defray the costs of incarceration.

With this amendment, the petition for panel rehearing is denied. Judges McKeown and Tallman have voted to deny the petition for rehearing en banc and Judge Hawkins so recommends. The full court has been advised of the petition for rehearing en banc and no judge of the court has requested a vote on whether to rehear the matter en banc. Fed. R. App. P. 35.

Appellees' petition for rehearing and petition for rehearing en banc are DENIED . No further petitions for rehearing or rehearing en banc will be entertained.

OPINION

HAWKINS, Circuit Judge:

Lester Shinault (“Shinault”) appeals the adverse grant of summary judgment on his claim that state officials violated his rights under the Eighth and Fourteenth Amendments when the Oregon Department of Corrections (“ODOC”) froze more than $60,000 in his inmate trust account to recover the cost of his incarceration. The district court held that Shinault received sufficient process because the State held a hearing prior to withdrawing the funds and that he did not suffer an injury under the Eighth Amendment. We affirm the district court on the Eighth Amendment claim because a state's obligation to provide medical care does not extend to shielding assets in inmate accounts. We disagree with the district court's due process determination because a state must provide a pre-deprivation hearing before freezing substantial inmate assets. Yet, we ultimately affirm on the basis of qualified immunity because the constitutional obligation was not clearly established at the time of the conduct.¹

FACTUAL BACKGROUND AND PROCEDURAL HISTORY

Lester Shinault was incarcerated with ODOC from May 19, 2005, until February 5, 2007, and again from October 23, 2008, until August 14, 2009, for felony convictions. During the latter term of incarceration, Shinault received a $107,416.48 settlement from a medical liability claim against a drug manufacturer whose products (prescribed while not in custody) caused him to develop diabetes.

Shinault's counsel in the product liability suit deposited the settlement proceeds into Shinault's inmate trust account. ODOC establishes trust accounts for each inmate, which are subject to various regulations governing accrual of interest, limitations on use and access, and offset for indebtedness. OR. Admin . R. 291–158–0015 et seq. Oregon law establishes that inmates are liable for the full cost of their incarceration, subject to various limitations. OR. Rev. Stat . §§ 179.620 ; 179.640. For instance, officials must take into consideration the inmate's ability to pay, id. § 179.620(1) -(2), and “the inmate's need for funds for personal support after release.” OR. Admin . R. 291–203–0040(5). Officials have discretion to waive collection “based on the best interest of the inmate or the department.” Id. 291–203–0080.

Relying on this authority, ODOC issued an order on May 29, 2009, requiring Shinault to pay $65,353.94, the estimated cost of his current and previous incarceration. Oregon calculates the cost of incarceration by multiplying the daily cost of care and the number of days an inmate is incarcerated. The daily cost of care is the quotient of the total cost of inmate care across the ODOC system divided by the number of inmates. The order advised Shinault of his right to contest the order, which he pursued by requesting a case hearing on June 2, 2009.

On the same day that Shinault requested a case hearing, ODOC transferred $65,353.94 into a “reserved miscellaneous” sub-account in Shinault's name. The record indicates that, after the transfer, Shinault could no longer access or use the funds in the “reserved miscellaneous” sub-account. ODOC took the position at the administrative hearing that it was “holding” and had “set aside” the funds.

After requesting and receiving a postponement of the administrative hearing, Shinault's privately retained counsel withdrew for unclear reasons about one month prior to the hearing. Shinault received ODOC's exhibits and filings the morning of the hearing and struggled to represent himself (“Your Honor, I don't know what I'm doing here ... I'm in left field here.”). He asked for a delay and the opportunity to hire new counsel, both of which were denied by the Administrative Law Judge (“ALJ”).² The ALJ ultimately ordered Shinault to pay $61,352.39, and the funds were withdrawn about one year later.³

Shinault did not appeal the ALJ order. Instead, he filed this action, alleging various constitutional harms. Defendants moved for summary judgment on all claims. A magistrate judge issued findings and recommended granting summary judgment on all claims. Over Shinault's objections, the district court adopted those recommendations.

JURISDICTION AND STANDARD OF REVIEW

We have jurisdiction under 28 U.S.C. § 1291. A grant of summary judgment is reviewed de novo. Lopez v. Smith, 203 F.3d 1122, 1131 (9th Cir.2000) (en banc). The court, viewing the facts in the light most favorable to the plaintiff, must determine whether any genuine issues of material fact exist.Id.

ANALYSIS

I. Procedural Due Process

The Fourteenth Amendment provides that no State shall “deprive any person of life, liberty, or property, without due process of law.” Due process “is a flexible concept that varies with the particular situation.” Zinermon v. Burch, 494 U.S. 113, 127, 110 S.Ct. 975, 108 L.Ed.2d 100 (1990). Due process protections extend only to deprivations of protected interests. See Bd. of Regents of State Colls. v. Roth, 408 U.S. 564, 569–70, 92 S.Ct. 2701, 33 L.Ed.2d 548 (1972).

An individual's property is a fundamental example of a protected interest. See Fuentes v. Shevin, 407 U.S. 67, 86, 92 S.Ct. 1983, 32 L.Ed.2d 556 (1972). More specifically, “[t]here is no question that [an inmate's] interest in the funds in his prison account is a protected property interest.” Quick v. Jones, 754 F.2d 1521, 1523 (9th Cir.1985). Shinault's trust account funds are within the scope of the Fourteenth Amendment.

Once a protected interest is found, we employ the three-part balancing test of Mathews v. Eldridge, 424 U.S. 319, 96 S.Ct. 893, 47 L.Ed.2d 18 (1976), to determine whether a pre-deprivation hearing is required and what specific procedures must be employed at that hearing given the particularities of the deprivation. Brewster v. Bd. of Educ., 149 F.3d 971, 983–84 (9th Cir.1998). The Mathews test balances three factors: (1) the private interest affected; (2) the risk of erroneous deprivation through the procedures used, and the value of additional safeguards; and (3) the government's interest, including the burdens of additional procedural requirements. Mathews, 424 U.S. at 335, 96 S.Ct. 893.

Recalling that due process varies depending on the particularities of a case, every action affecting an inmate trust account does not necessarily implicate a substantial private interest under the first Mathews prong. Here, however, Shinault's interest was clearly substantial, because ODOC deprived him of access to a significant amount of his funds. See Quick, 754 F.2d at 1522–23 ($66 charge merits pre-deprivation process); cf. Sickles v. Campbell Cnty., Ky., 501 F.3d 726, 730 (6th Cir.2007) (withdrawals of $110 and $20 do not implicate substantial private interest).

In terms of the second Mathews factor, two aspects of Oregon's regulatory scheme risk erroneous deprivation. The first—calculating the daily cost of care—involves mere arithmetic, but the calculations are more complex than flat fee arrangements found to involve minimal risk of error. See, e.g., Slade v. Hampton Roads Reg'l Jail, 407 F.3d 243, 253–54 (4th Cir.2005) (charging inmate $1 per day is a “ministerial” act); Tillman v. Lebanon Cnty. Corr. Facility, 221 F.3d 410, 413, 422 (3d Cir.2000) (taking $10 per day from inmate is a “routine matter[ ] of accounting.”). In fact, ODOC admits that it erred slightly by using the incorrect daily rate for one period of incarceration. In addition, the State's obligation to determine an inmate's ability to pay based on the inmate's estate, need for funds for personal support, and availability of benefits is an individualized decision that poses a risk of error. Or. Admin. R. 291–2030040(5).

As to the third Mathews factor, the government's interest in conserving taxpayer resources by sharing incarceration costs is substantial. Sickles, 501 F.3d at 731. Yet, the third factor is balanced by the need to assure that additional procedural safeguards are not administratively burdensome. Montanez v. Sec'y Pa. Dep't of Corr., 773 F.3d 472, 484–85 (3d Cir.2014).

The Supreme Court “usually has held that the Constitution requires...