Taylor v. F.D.I.C., 96-5267

• Decision Date: 23 December 1997
• Docket Number: No. 96-5267,96-5267
• Citation: 328 U.S. App. D.C. 52,132 F.3d 753
• Parties: Jacqueline P. TAYLOR, et al., Appellants, v. FEDERAL DEPOSIT INSURANCE CORPORATION and Ricki Helfer, Chairman, FDIC, Appellees.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 753

132 F.3d 753

328 U.S.App.D.C. 52

Jacqueline P. TAYLOR, et al., Appellants, v. FEDERAL DEPOSIT INSURANCE CORPORATION and Ricki Helfer Chairman, FDIC, Appellees.

No. 96-5267.

United States Court of Appeals, District of Columbia Circuit.

Argued Oct. 17, 1997.

Decided Dec. 23, 1997.

Appeal from the United States District Court for the District of Columbia (No. 94cv01916).

Robert C. Seldon, Washington, DC, argued the cause for appellants. With him on the brief was Joanne Royce.

Marina Utgoff Braswell, Assistant U.S. Attorney, Washington, DC, argued the cause for appellees. With her on the brief was Mary Lou Leary, U.S. Attorney, and R. Craig Lawrence, Assistant U.S. Attorney. John D. Bates, Assistant U.S. Attorney, entered an appearance.

Before: WILLIAMS, SENTELLE and ROGERS, Circuit Judges.

Opinion for the Court filed by Circuit Judge STEPHEN F. WILLIAMS.

Concurring opinion filed by Circuit Judge ROGERS.

STEPHEN F. WILLIAMS, Circuit Judge:

Three former employees of the Resolution Trust Corporation ("RTC") have sued the corporation, claiming that it retaliated against them for making protected disclosures, in violation of the RTC Whistleblower Act, 12 U.S.C. § 1441a(q), and the First Amendment. When the RTC's statutory life expired, its statutory successor, the Federal Deposit Insurance Corporation ("FDIC"), was substituted as defendant. On the FDIC's motion for dismissal or, alternatively, for summary judgment, the district court dismissed the statutory counts of the complaint under Rule 12(b)(6) and entered summary judgment for the defendant on the constitutional counts. This appeal followed. Except to the extent that we vacate for want of jurisdiction, we affirm.

* * *

The Financial Institutions Reform, Recovery, and Enforcement Act of 1989 created the RTC to manage and resolve savings and loan cases. 12 U.S.C. § 1441a(b). With the exception of its CEO, the RTC had no employees of its own; it drew them instead from the FDIC. 12 U.S.C. § 1441a(b)(8). In 1991, appellants Bruce Pederson and Jacqueline Taylor were senior attorneys in the RTC's Western Regional Office in Denver, attached to the Professional Liability Section ("PLS"), whose assigned task was to bring suits against disloyal fiduciaries of failed savings and loans. The third appellant, Juan Luis Burgos-Gandia, occupied a different office (Dallas) and served in a different capacity. A fourth ex-employee plaintiff, Richard Dunn, is not a party to this appeal but will be conspicuous by his absence.

Pederson and Taylor's conflict with the RTC began in 1992, when they took issue with a reorganization of their office initiated in anticipation of the RTC's 1995 statutory sunset. See 12 U.S.C. § 1441a(m)(1). In March of 1992, Pederson circulated a memo to RTC management detailing his concerns that the reorganization would hinder the PLS. Joint Appendix ("J.A.") 786. To no avail; the reorganization went on as planned and on May 11 of 1992, he and Taylor were selected for return to the FDIC as part of the "put-back" program. ¹ In anticipation, they were assigned to a "Special Projects Unit" which occupied a different Denver office and, according to Pederson and Taylor, constituted a professional purgatory--they were denied meaningful work, support staff, computer links and supplies, and they were ostracized by former colleagues afraid to be seen with them. J.A. 754-55.

Having achieved little with his internal memo, Pederson changed forum and theme: During the summer and into the fall of 1992, he and Taylor communicated with the General Accounting Office ("GAO") and testified before the Senate Banking Committee, alleging now that the reorganization was concocted to protect well-connected malefactors by hamstringing their PLS pursuers. The GAO and RTC's Inspector General investigated; reports issued in the summer of 1993 found no illicit cronyism, but concluded that the reorganization had been handled poorly.

The put-back program was canceled in July 1992, but Pederson and Taylor remained in their Special Projects exile. There, they contend, they were subject to continual retaliation and discrimination until their May 1995 resignations (which they characterize as constructive discharges).

Appellant Burgos was employed as a litigator in RTC's Dallas office. His troubles started, he alleges, when he notified his superiors of overbilling by outside counsel. In response, RTC management allegedly assigned him to undesirable cases, including some in which the RTC had already defaulted. Burgos claims that in one of these cases, Crabb v. Federal Home Loan Mortgage Corp., his superiors continued to litigate despite a settlement, against the wishes of the client (another branch of the RTC) and in order to conceal their earlier default. Burgos urged his supervisors to abandon the litigation; when they did not heed him, he directed outside counsel to withdraw a pending motion. Burgos's superiors ordered him to rescind that instruction; when he refused, they countermanded it themselves. Burgos then filed an "Informative Motion" with the Crabb court, disclosing the role of his superiors in the decision to continue litigation, as well as his opposition to that decision.

The RTC notified Burgos that he would be fired for this insubordination; in fact it simply placed him on paid administrative leave. Eventually informed that he would be demoted two pay grades, he resigned on January 8, 1995. Like Taylor and Pederson, Burgos characterizes his resignation as a constructive discharge.

* * *

As we have said, the district court dismissed the statutory claims of Pederson, Taylor and Burgos and granted the FDIC summary judgment on the constitutional ones. But there was another ex-employee, Dunn, who had joined the original claim. (A fifth plaintiff, the Government Accountability Project, was also a party to the district court litigation but has withdrawn from the action.) Although the district court dismissed the statutory claims of all plaintiffs, it initially withheld judgment on Dunn's constitutional claims. To avoid delay in their appeal, the three plaintiffs now before us filed a Motion to Direct Entry of Final Judgment without waiting for the disposition of Dunn's claims, arguing in the words of Rule 54(b) that there was "no just reason for delay." The court then issued an order, observing that grant of the plaintiffs' motion would be "just and proper," and ordering that the clerk "be directed" to enter final judgment dismissing their claims.

Rule 54(b) mediates between the sometimes antagonistic goals of avoiding piecemeal appeals and giving parties timely justice. See Curtiss-Wright Corp. v. General Elec. Co., 446 U.S. 1, 8, 100 S.Ct. 1460, 1464-65, 64 L.Ed.2d 1 (1980). In a case involving multiple claims or parties, it allows the district court to "direct the entry of a final judgment as to one or more but fewer than all of the claims or parties only upon an express determination that there is no just reason for delay and upon an express direction for the entry of judgment." Federal Rule of Civil Procedure 54(b). The district court functions as a "dispatcher," determining in its sound discretion when a claim should proceed on to appellate resolution, and when it should await its fellows. ² Curtiss-Wright, 446 U.S at 8, 100 S.Ct. at 1464-65.

Here, the district court's order clearly gave the "express direction" that the rule requires, but did it make the necessary "express determination"? Given plaintiffs' invocation of Rule 54(b)'s "no just reason for delay" formula in their motion for entry of judgment under that rule, and the court's obvious embrace of their position, it is as clear as these things get that the court was convinced that the rule's criteria were satisfied. Our circuit has never decided precisely what a Rule 54(b) "express determination" requires. In Kelly v. Lee's Old Fashioned Hamburgers, Inc., 908 F.2d 1218 (5th Cir.1990), a deeply split Fifth Circuit considered the issue en banc, the majority finding it sufficient that the order and related parts of the record revealed an "unmistakable intent to enter a partial final judgment under Rule 54(b)." Id. at 1220. There was no need, said the majority, for the district judge to "mechanically recite the words 'no just reason for delay.' " Id. The majority, however, never really answered the dissenters' point that "express," the Rule's modifier of "determination," does not normally mean "implied." Id. at 1222; accord Granack v. Continental Casualty Co., 977 F.2d 1143, 1144-45 (7th Cir.1992).

Without some convincing answer to the Fifth Circuit dissenters' challenge, we do not know how our circuit could reject their analysis. Certainly no such answer emerged at oral argument. Were we to apply the dissenters' view, we would be compelled to dismiss the appeal. Here that would be clearly wasteful in the short run: the case would vanish from the docket of a panel that has invested much time on the merits. Our dismissal of this appeal, besides following the rules as understood by the Fifth Circuit dissenters, would have its pay-off in future cases, by inspiring closer district court focus on the criteria of Rule 54(b) and by removing ambiguities as to what they actually require.

In this case, happily, we need not bite this distasteful bullet. The government raised the Rule 54(b) issue in a motion for dismissal or summary affirmance before a motions panel of this court. The motion was denied, see March 31, 1997 Order, Taylor v. FDIC (No. 96-5267), and that decision is law of the case, preclusive for all matters decided expressly or by necessary implication. See Crocker v. Piedmont Aviation, 49 F.3d 735, 739 (D.C.Cir.1995). The panel's decision is binding, even though the adequacy of the determination is a jurisdictional prerequisite. See LaShawn A. v. Barry, 87 F.3d 1389, 1394 (D.C.Cir.1996) (en banc).

Law of the case, yes; law of the circuit, no. The order of the motions panel went...