Opinion
Civil Action No. 3:99-CV-1989-M.
June 9, 2004
FINDINGS, CONCLUSIONS, RECOMMENDATION OF THE UNITED STATES MAGISTRATE JUDGE
Pursuant to the District Court's Standing Order of Reference, filed May 12, 2003, which referred this case to the undersigned United States Magistrate Judge for pretrial management and recommendation on dispositive motions, the Court has before it the following pleadings:
1. Motion for Summary Judgment on Behalf of Karen Bruton, Kenneth Klein, Bradford Lambert, Rolf Nordstrom, Richard Riccobono and Frederick Teed, filed November 17, 2003;
2. Memorandum in Support of Motion for Summary Judgment on Behalf of Karen Bruton, Kenneth Klein, Bradford Lambert, Rolf Nordstrom, Richard Riccobono and Frederick Teed, filed November 17, 2003;
3. Appendix to Memorandum in Support of Motion for Summary Judgment on Behalf of Karen Bruton, Kenneth Klein, Bradford Lambert, Rolf Nordstrom, Richard Riccobono and Frederick Teed, filed November 17, 2003;
4. Plaintiffs' Response to Defendants Karen Bruton, Kenneth Klein, Bradford Lambert, Rolf Nordstrom, Richard Riccobono and Frederick Teed's Motion for Summary Judgment, filed February 20, 2004;
5. Plaintiffs' Brief in Support of Their Response and Opposition to Defendants' Motion for Summary Judgment, filed February 20, 2004;
6. Plaintiffs' Objections to the Affidavits of Defendants Karen Bruton, Kenneth Klein, Bradford Lambert, Rolf Nordstrom, Richard Riccobono and Frederick Teed in Support of Defendants [sic] Motion for Summary Judgment, filed February 20, 2004;
7. Reply in Support of Motion for Summary Judgment on Behalf of Karen Bruton, Kenneth Klein, Bradford Lambert, Rolf Nordstrom, Richard Riccobono and Frederick Teed, filed March 22, 2004;
8. Motion for Summary Judgment of Defendants Vincent G. Fazzio and Jennifer Gant, filed November 17, 2003;
9. Brief in Support of Motion for Summary Judgment of Defendants Vincent G. Fazzio and Jennifer Gant, filed November 17, 2003;
10. Plaintiffs' Response to Defendants Fazzio Gant's Motion for Summary Judgment, filed February 20, 2004;
11. Plaintiffs' Brief in Support of Their Response and Opposition to Defendants' [sic] Fazzio Gant's Motion for Summary Judgment, filed February 20, 2004;
12. Plaintiff's Objections to the Affidavits of Defendants Fazzio Gant in Support of Defendants [sic] Motion for Summary Judgment, filed February 20, 2004;
13. Reply Brief in Support of Motion for Summary Judgment of Defendants Vincent Fazzio and Jennifer Gant, filed March 22, 2004; and
14. Objections to Plaintiffs' Summary Judgment Evidence of Defendants Vincent Fazzio and Jennifer Gant, filed March 22, 2004.
Based on the pleadings, the evidence submitted therewith, and the applicable law, the Court is of the opinion that the Motion for Summary Judgment of Defendants Vincent G. Fazzio and Jennifer Gant should be GRANTED, the Motion for Summary Judgment on Behalf of Karen Bruton, Kenneth Klein, Bradford Lambert, Rolf Nordstrom, Richard Riccobono and Frederick Teed should be GRANTED, and this action should be DISMISSED with prejudice.
I. BACKGROUND
A. FactsThis is a Bivens action against several federal employees in their individual capacities arising out of the March 22, 1995 convictions of John H. Carney and John R. Fisher ("Plaintiffs") for bank fraud, mail fraud, wire fraud, conspiracy, and making false statements to government officials. Their convictions were later reversed, giving rise to this action.
Actions against federal employees in their individual capacities for constitutional violations may be brought under Bivens v. Six Unknown Named Agents of the Federal Bureau of Narcotics, 403 U.S. 388, 397 (1971). See Melear v. Spears, 862 F.2d 1177, 1182 n. 5 (5th Cir. 1989).
The background facts of this case are undisputed and taken largely from the Fifth Circuit Court of Appeals' opinion reversing Plaintiffs' convictions in the underlying criminal case, United States v. Fisher, 106 F.3d 622 (5th Cir. 1997).
In the summer of 1987, Plaintiffs formed a corporation and bank holding company, United States Savings Associates ("USSA"), in order to purchase a foundering savings and loan institution in Port Charlotte, Florida, named Bayside Savings and Loan Association ("Bayside"). The purchase was approved by the Office of Thrift Supervision ("OTS"), and Plaintiffs raised capital in part by offering repurchase agreements that allowed investors to purchase "units" in USSA. In return, Plaintiffs agreed to obtain refinancing of the investor's residential investments. If refinancing was not timely obtained, USSA was obligated to repurchase each investor's unit.
One investor, Bradley Branson ("Branson"), a professional basketball player living in Spain at the time, purchased two units through his accountant Michael Tannery ("Tannery"). Branson had allegedly granted Tannery full power of attorney, including the authority to enter into and manage his investments. Tannery invested in Bayside on Branson's behalf, but "overpaid" by mistakenly including an additional check for $20,000.
In 1989, Bayside began to suffer severe financial difficulties, due in part to the enactment of the Financial Institutions Reform, Recovery, and Enforcement Act ("FIRREA"). The FIRREA diminished Bayside's capital reserves from nearly $4,000,000 to approximately $800,000; Bayside's lending ability was correspondingly constrained. Some investors sought to recoup their investments, and Tannery attempted to recover the $20,000 overpayment on behalf of Branson. Tannery experienced difficulty in obtaining any money from Bayside, and Plaintiff Fisher allegedly told Tannery to apply for a loan in Branson's name, and Plaintiffs would repay it. Tannery applied for the loan and signed a letter of credit and promissory note in Branson's name, allegedly without Branson's knowledge or approval. Branson claimed to have first learned of Tannery's loan application after the application was submitted in November 1990. (Pls. App. at 12.) On January 14, 1991, Branson revoked Tannery's power attorney and granted power of attorney to Michael Jaccar ("Jaccar"). Branson authorized Jaccar to gather all information regarding Tannery's investment of Branson's money in Bayside.
Plaintiffs have submitted separate responses and a joint appendix in response to both motions for summary judgment. The Court refers to the joint appendix as "App."
On March 13, 1992, an OTS employee (who is not named in this suit) interviewed Jaccar and reported the interview to OTS employee Frederick Teed. In the report, Jaccar stated that Branson was unaware of and did not authorize the loan, did not receive the loan proceeds, and was uncertain of the use of those proceeds. The report further stated that Branson believed that the funds "somehow went to Fisher and Carney," and that Plaintiffs were acting together with Tannery. (Pls. App. at 7.)
Subsequently, Federal Bureau of Investigation ("FBI") agents Vincent Fazzio and Jennifer Gant ("FBI Agents") opened a criminal investigation of Bayside and the Tannery/Branson loan. On August 26, 1992, Jaccar was interviewed by OTS employee Teed, Assistant United States Attorney Richard Kamp, and FBI agent Fazzio. (Pls. App. at 9.) During the interview, Jaccar reiterated Branson's statements that he did not authorize Tannery to take out the loan and he did not obtain the loan proceeds. (Pls. App. at 10.) The FBI memorialized the interview in a report on a standard "302" form used for recording witness interviews, and the parties refer to the report as the "Jaccar 302." On November 24, 1992, the FBI conducted a telephonic interview with Branson in which he substantiated Jaccar's statements. His interview was memorialized in a report referred to as the "Branson 302." (Pls. App. at 12.)
On February 1, 1993, OTS employee Rolf Nordstrom (then known as Rolf Colburn) notified Plaintiffs that the OTS would begin an "on-site examination" of Bayside. (Pls. App. at 13.) Plaintiffs allege that OTS employees Karen Bruton, Kenneth Klein, Bradford Lambert, Rolf Nordstrom, Richard Riccobono, and Frederick Teed ("OTS Defendants") either directly examined or supervised the examination of Bayside and its investors. During the same time, the FBI began a criminal investigation of Bayside.
On March 17, 1994, the Department of Justice ("DOJ") indicted Plaintiffs on charges arising from the FBI's investigation of the Tannery/Branson loan. The indictment charged Plaintiffs together and individually with conspiring to commit mail fraud, wire fraud, and bank fraud, and to make false statements to and obstruct the operation of the OTS. The prosecutors granted Tannery immunity in exchange for his testimony regarding Plaintiff Fisher's alleged offer to repay the Tannery/Branson loan. Tannery testified to the grand jury and at trial that Branson was aware of the loan, and that Branson's power of attorney authorized Tannery to sign Branson's name to the loan application. (Pls. App. at 6.) Tannery's testimony contravened the statements by Branson and Jaccar that Branson was unaware of the loan, did not request it, and did not authorize Tannery to sign his name to the loan application.
Before trial, Fisher's counsel requested all exculpatory evidence including any "information affecting the credibility of any person called as a witness by the Government." Fisher, 106 F.3d at 634. "The Government answered [that] it was unaware of any Brady material at that time." Id. It is undisputed that Plaintiffs were not provided with the Branson 302 at that time. After Tannery testified, the defense filed another motion seeking exculpatory evidence specifically related to Tannery and any purported power of attorney from Branson. On the last day of trial, the prosecution produced to the defense the Branson 302, which contained Branson's statements that he did not request that Tannery obtain a loan from Bayside, he was unaware any such loan was requested in his name, and he did not know what happened to the proceeds. See id. Plaintiff Carney's counsel moved for a new trial on grounds that the Branson 302 was exculpatory evidence because Branson's statements were inconsistent with Tannery's testimony and its late production prevented the defense from using it to impeach Tannery. The district court ruled that the Branson 302 was not inconsistent with Tannery's testimony and denied the motion for a new trial. The jury convicted Plaintiffs, and they were sentenced to prison.
Plaintiffs filed a joint appeal, and on February 13, 1997, the Fifth Circuit Court of Appeals reversed Plaintiffs' convictions on several grounds. See Fisher, 106 F.3d at 635-36. The Fifth Circuit held that the late disclosure of the Branson 302 should have resulted in a new trial for Plaintiff Fisher. See id. The court did not, however, discuss the Branson 302 with respect to Plaintiff Carney. Plaintiff Carney's convictions were reversed on other grounds, including the district court's refusal to admit evidence of a successful arbitration and the admittance of an invalid conviction. The Fifth Circuit remanded both convictions for new trials. On October 3, 1997, the prosecution retried Plaintiffs. Plaintiffs were acquitted of all charges except bank fraud, which had been dropped before trial.
B. Procedural History
The procedural history of this case is long and convoluted. On September 3, 1999, Plaintiffs filed this suit alleging constitutional and common law tort claims against the United States, the OTS, and the FBI as well as DOJ employees, FBI Agents, and OTS Defendants in their official and individual capacities. Plaintiffs' claims are based on their contentions that OTS Defendants improperly used the savings and loan regulatory examination process to assist the FBI and the DOJ in their investigation and prosecution of Plaintiffs, and that all defendants improperly withheld exculpatory evidence. (Third Am. Compl. at ¶ 140.) The district court substituted the United States for all individual federal employees with respect to Plaintiffs' common law claims and dismissed all claims against the United States, the OTS, the FBI, the DOJ employees, and Plaintiffs' official capacity claims against FBI Agents and OTS Defendants.
The procedural history of this case is more fully set forth in the Court's December 5, 2002 recommendation, which was adopted by the District Court by order dated March 31, 2003.
Subsequently, the United States, the FBI, and other federal employees filed separate motions to dismiss Plaintiff's claims. OTS Defendants and FBI Agents did not join in these motions or file their own motions to dismiss. On March 31, 2003, the district court dismissed all of Plaintiffs' claims against the FBI, the United States, and the other federal employees. Thus, Plaintiff's only remaining claims are those against OTS Defendants and FBI Agents.
Plaintiffs' 99-page Third Amended Complaint contains several claims, but it does not clearly identify the particular claims against each individual defendant. The Court held a case management conference on May 30, 2003, to determine which specific claims remained against FBI Agents and OTS Defendants. Based on the conference and the Court's review of the Third Amended Complaint, it is apparent that Plaintiffs do not allege each claim against each defendant individually. Although Plaintiffs' claims are often titled as being against "All Named Defendants," the body of each claim contains specific allegations against particular defendants. Thus, the Court will address the claims only as to the particular defendants against whom specific allegations are actually made.
OTS Defendants and FBI Agents assert the defense of qualified immunity with regard to the remaining claims against them. On July 22, 2003, the Court established a briefing schedule for dispositive motions on the issue of qualified immunity. Subsequently, Plaintiffs propounded written discovery requests, and FBI Agents and OTS Defendants jointly moved for protection from the requests on September 26, 2003. They argued that Plaintiffs' requests exceeded the scope of permissible discovery on the issue of qualified immunity. After a courtroom hearing on the motion on October 23, 2003, the Court determined that Plaintiffs could conduct limited discovery on the issue of qualified immunity with respect to their claims of withholding exculpatory evidence and subornation of perjury. In particular, discovery was allowed on the issues of whether FBI Agents and OTS Defendants deliberately concealed exculpatory evidence and whether OTS Defendants Lambert, Teed, and Nordstrom suborned perjury. Subsequently, Plaintiffs conducted written discovery and orally deposed each of the FBI Agents and OTS Defendants. Plaintiffs have provided transcripts of these depositions. (Pls. App. at 111-118.)
On November 17, 2003, FBI Agents and OTS Defendants filed separate motions for summary judgment with supporting evidence. Plaintiffs filed separate responses with supporting evidence and a joint appendix referred to in both responses. Because FBI Agents' and OTS Defendants' motions relate to substantially the same claims and argue similar grounds for summary judgment, and Plaintiffs cite substantially the same evidence in their responses, the Court addresses the motions together in the interests of judicial economy. The motions are now before the Court and ripe for determination.
II. ANALYSIS
A. Summary Judgment Standard
This case involves issues of law and fact. "Summary judgment is an appropriate mechanism for resolving issues of law arising from a materially complete factual record." Burlington Northern and Santa Fe Ry. Co. v. Brotherhood of Maintenance of Way Employees, 93 F. Supp.2d 751, 756 (N.D. Tex. 2000). "Furthermore, disputes over the legal inferences to be gleaned from the facts in evidence will not prevent summary judgment; thus, where a non-movant merely debates the consequences flowing from admitted facts, summary judgment is proper." Id. Summary judgment is appropriate when the pleadings and record evidence show that no genuine issue of material fact exists and that the movant is entitled to judgment as a matter of law. See Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir. 1994). "[T]he substantive law will identify which facts are material[,]" and only genuine disputes about material facts will preclude summary judgment. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). If the non-movant bears the burden of proof at trial, the movant may satisfy its burden by showing that there is an absence of evidence to support the non-movant's case. Latimer v. Smithkline French Lab., 919 F.2d 301, 303 (5th Cir. 1990). Once the movant makes this showing, the burden shifts to the non-movant to show that summary judgment is inappropriate. Little, 37 F.3d at 1075. The non-movant cannot meet his burden with unsubstantiated assertions, conclusional allegations, or a scintilla of evidence. See id. Furthermore, the court must view all of the evidence in the light most favorable to the non-movant. See Richter v. Merchants Fast Motor Lines, Inc., 83 F.3d 96, 98 (5th Cir. 1996).
Although Plaintiff Carney is proceeding pro se, he is an attorney who has been licensed by the State of Texas since 1981. While pro se parties are normally accorded more leniency in the construction of their pleadings, see Estelle v. Gamble, 429 U.S. 97, 106 (1976), the Court need not afford a licensed attorney such leniency when the attorney appears pro se. See Harbulak v. Suffolk County, 654 F.2d 194, 198 (2d Cir. 1981) (holding that the plaintiff "is a practicing attorney and, therefore, cannot claim the special consideration which courts customarily grant to pro se parties"); Tindall v. Gibbons, 156 F. Supp.2d 1292, 1294 n. 1 (M.D. Fla. 2001) (same); DeFina v. Latimer, 79 F.R.D. 5, 7 (E.D.N.Y. 1997) (same). Plaintiff Fisher is represented by counsel. Accordingly, the Court need not extend the same leniency to Plaintiffs' pleadings that it normally extends to other pro se pleadings.
B. Supervisory Liability
1. Respondeat Superior
Plaintiffs expressly assert claims under the doctrine of respondeat superior against OTS Defendants Riccobono and Klein. It is well-settled that respondeat superior liability is not recognized in a Bivens action. See Cronn v. Buffington, 150 F.3d 538, 544 (5th Cir. 1998) (recognizing that "there is no doctrine of respondeat superior in Bivens actions") (citing Abate v. Southern Pac. Transp. Co., 993 F.2d 107, 110 (5th Cir. 1993) (citing cases)). "Rather, a supervisory official may be held liable when he is either personally involved in the acts causing the deprivation of a person's constitutional rights, or `if he implements a policy so deficient that the policy itself acts as a deprivation of constitutional rights.'" Johnson v. Ramos, 2003 WL 22946476, at *5 (N.D. Tex. March 26, 2003) (quoting Cronn, 150 F.3d at 544). Accordingly, to the extent that Plaintiffs assert a cause of action under the doctrine of respondeat superior, summary judgment should be granted.
Despite express invocation of this doctrine, Plaintiffs do not seek to hold OTS Defendants Riccobono and Klein liable for the conduct of subordinate OTS Defendants. Rather, Plaintiffs allege that OTS Defendants Riccobono and Klein were personally involved in violating their constitutional rights and that they implemented a deficient policy by failing to train the other OTS Defendants with respect to limits on the gathering of evidence in the OTS regulatory examination. (Third Am. Compl. at 95; Resp. at 32-35.) The Court separately addresses these claims below.
2. Deficient Policy
Plaintiffs allege that OTS Defendants Riccobono and Klein implemented a deficient policy that deprived them of their constitutional rights. (Third Am. Compl. at 95.) Plaintiffs' complaint alleges that these defendants are liable for "policies and failure to implement policies[,]" but it does not identify any particular "policies." See id. In Plaintiffs' responses, they allege that the offending "policy" was OTS Defendants Riccobono's and Klein's failure to train other OTS Defendants regarding OTS Regulatory Bulletin 18-4. (Resp. at 32-34.) OTS Regulatory Bulletin 18-4, advises OTS employees against the improper gathering of evidence for the purpose of making a criminal referral:
The OTS's investigative powers may not be used to conduct a criminal investigation or to gather documents for the purposes of making a criminal referral. . . . However, when information obtained for an authorized civil purpose is sufficient to provide a reasonable factual basis that a crime has been or may be committed . . . OTS personnel in the District or in Enforcement will make appropriate criminal referrals, using the OTS's Form 366.
(Resp. App. at Ex. 29.) Plaintiffs allege that OTS Defendants Riccobono and Klein were responsible for ensuring compliance with this bulletin, that they failed to train other OTS Defendants on its commands, and that the failure resulted in the "highly likely consequence" that exculpatory evidence would be withheld with "deliberate indifference" to Plaintiffs' constitutional rights. See id. at 34-35.
A failure to train may show the implementation of a deficient policy. See City of Canton v. Harris, 489 U.S. 378, 380 (1989) (holding that a municipality can be held liable under § 1983 "for constitutional violations resulting from its failure to train municipal employees."), cited in Bradley v. United States, 164 F. Supp.2d 437, 453 (D.N.J. 2001) (explaining that a failure to train claim under Bivens requires that the plaintiff show "the officers acted pursuant to a [federal] custom or policy not to adequately train or supervise."). However, a negligent failure to train is insufficient; a plaintiff must show that the failure to train was done with "deliberate indifference" to his rights. See Board of County Comm'rs of Bryan County, Okla. v. Brown, 520 U.S. 397, 407 (1997) ("A showing of simple or even heightened negligence will not suffice."); accord Ting v. United States, 927 F.2d 1504, 1512 (9th Cir. 1991) (noting that an "inadequacy of police training may serve as a basis for liability under section 1983 or Bivens `only where the failure to train amounts to deliberate indifference'").
A showing of deliberate indifference usually requires "[p]roof of more than a single instance of the lack of training or supervision causing a violation of constitutional rights[.]" Thompson v. Upshur County, TX, 245 F.3d 447, 459 (5th Cir. 2001). For example, Plaintiffs may present evidence showing a pattern of similar violations. See id. "However, a single incident of an alleged constitutional violation resulting from the failure to train may serve as a basis for liability so long as that violation was an obvious consequence of the failure to train." Barnes v. Barnes, 2004 WL 691202, at *10 (N.D. Tex. March 30, 2004) (citing Brown v. Bryan County, Okla., 219 F.3d 454, 460 (5th Cir. 2000)). Finally, the inadequacy of training must be obvious and obviously likely to result in a constitutional violation, and liability attaches only if there is direct causation between the policy and the injury. See Thompson, 245 F.3d at 459; see also Brown, 219 F.3d at 460.
Plaintiffs do not present evidence of a pattern of violations. Rather, Plaintiffs allege that the violations to their rights were the obvious consequences of the alleged failure to train OTS Defendants regarding OTS Regulatory Bulletin 18-4. (Resp. at 33-34.) Plaintiffs cite the deposition testimony of OTS Defendants Riccobono and Klein as evidence of their failure to train. (Resp. at 33-34; App. at 29.) The cited portions of these defendants' deposition testimony reflect that at the time of the OTS examination and FBI investigation, neither defendant implemented or trained other OTS Defendants regarding OTS Regulatory Bulletin 18-4. (Resp. at 33-34.) However, this bulletin does not relate to Plaintiffs' claims that OTS Defendants withheld exculpatory evidence or suborned perjury. Indeed, the bulletin concerns the gathering of information during an OTS regulatory examination, not the handling of evidence during a criminal proceeding. Plaintiffs do not explain how the failure to train other OTS Defendants on this bulletin would have resulted in the "obvious consequence" of violating Plaintiffs' rights.
Viewing all evidence in the light most favorable to Plaintiffs, Plaintiffs have failed to show a genuine issue of law or fact regarding whether the alleged failure to train on this bulletin violated their rights. Because Plaintiffs claim that the offending "policy" was OTS Defendants Riccobono's and Klein's failure to train, and Plaintiffs did not establish a failure to train, Plaintiffs have failed to show a deficient policy. Accordingly, OTS Defendants Riccobono and Klein should be granted summary judgment on Plaintiffs' claims with regard to the implementation of a deficient policy. See id.
C. Malicious Prosecution
Plaintiffs assert constitutional malicious prosecution claims against OTS Defendants and FBI Agents. (Third Am. Compl. at 75-77.) OTS Defendants move for summary judgment on Plaintiffs' constitutional malicious prosecution claims. (OTS Defs. Br. at 12-13.) FBI Agents do not move for summary judgment on Plaintiffs' constitutional malicious prosecution claims. Nevertheless, the Court may raise the issue of summary judgment sua sponte and may grant it sua sponte if the record does not support this claim. See Ficq v. Texas Instruments Inc., 2004 WL 576057, at *1 (N.D. Tex. March 1, 2004) ("it is well settled that a judge not only may raise summary judgment sua sponte, he may grant it sua sponte.") (citing Mo. Pac. R.R. Co. v. Harbison-Fischer Mfg. Co., 26 F.3d 531, 539 (5th Cir. 1994)).
OTS Defendants and FBI Agents both argue that Plaintiffs' malicious prosecution claims are not against them. In their Third Amended Complaint, Plaintiffs assert claims for "STATE AND FEDERAL" malicious prosecution against "ALL NAMED DEFENDANTS." Plaintiffs' state law malicious prosecution claims were dismissed by a previous Order. (9/13/00 Ord. at 6-7.) The Court assumes for the purposes of this analysis that Plaintiffs' constitutional malicious prosecution claims are alleged against all OTS Defendants and FBI Agents.
There is no "freestanding constitutional right to be free from malicious prosecution[.]" Castellano v. Fragozo, 352 F.3d 939, 941 (5th Cir. 2003) ( en banc), cited in Hamilton v. Collett, 83 Fed. Appx. 634, 636, 2003 WL 22965650, at *2 (5th Cir. Dec. 11, 2003) (explaining that "this court has recently held that a claim of malicious prosecution standing alone does not violate the United States Constitution."). Rather, a malicious prosecution claim must specify the particular constitutional right allegedly violated: "This conclusion in turn means that we must insist on clarity in the identity of the constitutional violations asserted." Castellano, 352 F.3d at 941. Despite three opportunities to amend their complaint, Plaintiffs allege only a stand-alone constitutional claim for malicious prosecution. Because the Fifth Circuit does not recognize a stand-alone claim for constitutional malicious prosecution, this claim fails as a matter of law. See id. Accordingly, OTS Defendants and FBI Agents should be granted summary judgment on Plaintiffs' claims for "federal" malicious prosecution. See id.
D. Perjury
Plaintiffs assert perjury claims against OTS Defendants Nordstrom and Lambert. (Third Am. Compl. at 80-86.) OTS Defendants Nordstrom and Lambert move for summary judgment on Plaintiffs' perjury claims on grounds that they testified truthfully and they are otherwise entitled to absolute immunity.
It is well-settled that trial witnesses are entitled to absolute immunity for their trial testimony. See Charles v. Wade, 665 F.2d 661, 666 (5th Cir. 1982) (finding absolute immunity from Bivens action for trial witnesses); see also Briscoe v. LaHue, 460 U.S. 325, 331-334 (1983) (holding that trial witnesses are shielded by absolute immunity). There is an exception to absolute immunity, however, when a witness is a "complaining witness," which is defined as one who "instigates, encourages, or continues the prosecution[.]" Keko v. Hingle, 318 F.3d 639, 643 (5th Cir. 2003).
Plaintiffs argue that OTS Defendants Nordstrom and Lambert were complaining witnesses. (Resp. at 2-4; Third Am. Compl. at ¶¶ 185-187.) Plaintiffs allege that OTS Defendants Nordstrom and Lambert utilized the regulatory examination process as a means of instigating and furthering the criminal investigation and prosecution of Plaintiffs. However, Plaintiffs fail to present any evidence showing that OTS Defendants Nordstrom and Lambert instigated, encouraged, or continued Plaintiffs' prosecution. Plaintiffs' conclusory allegations that OTS Defendants Nordstrom and Lambert were aware of an ongoing criminal investigation and made documents available to the FBI are insufficient to create a genuine issue of fact or law showing that these defendants instigated or furthered the prosecution. See Keko, 318 F.3d at 643. Thus, Plaintiffs have failed to show that OTS Defendants Nordstrom and Lambert were complaining witnesses.
Moreover, even assuming for purposes of this motion that OTS Defendants Nordstrom and Lambert defendants were complaining witnesses, Plaintiffs have presented no evidence that they testified falsely. Plaintiffs allege that these defendants testified falsely about the extent of coordination between the OTS regulatory examination and the FBI's criminal investigation. (Third Am. Compl. at 80-86; Fisher Decl. at 20.) Specifically, Plaintiffs contend that OTS Defendants Nordstrom and Lambert presented testimony that mischaracterized or misrepresented OTS Defendants' coordination with the FBI and Plaintiffs' filings with the OTS. See id. However, Plaintiffs cite no evidence showing that OTS Defendants Nordstrom's and Lambert's testimony was actually false. Accordingly, Plaintiffs have not shown a genuine issue or fact or law as to whether OTS Defendants Nordstrom and Lambert were complaining witnesses or testified falsely. Thus, OTS Defendants Nordstrom and Lambert should be granted summary judgment on Plaintiffs' perjury claims.
E. Subornation of Perjury
Plaintiffs allege claims for subornation of perjury against all OTS Defendants and FBI Agent Fazzio, but not FBI Agent Gant. (Third Am. Compl. at 71-73.) OTS Defendants move for summary judgment on Plaintiffs' subornation of perjury claims on the grounds that they are entitled to qualified immunity. FBI Agent Fazzio has not moved for summary judgment on Plaintiffs' subornation of perjury claim against him. Nevertheless, the Court may raise the issue of summary judgment sua sponte and may grant it sua sponte if this claim is unsupported by the record. See Ficq, 2004 WL 576057, at *1.
1. Qualified Immunity Standard
"Public officials acting within the scope of their official duties are shielded from civil liability by the qualified immunity doctrine." Kipps v. Caillier, 197 F.3d 765, 768 (5th Cir. 1999). Government officials are entitled to qualified immunity "insofar as their conduct does not violate clearly established statutory or constitutional rights of which a reasonable person would have known." Id. (quoting Harlow v. Fitzgerald, 457 U.S. 800, 818 (1982)); see also Jones v. Soles, 2001 WL 1636362, at *3 (N.D. Tex. Dec. 18, 2001). Qualified immunity encompasses claims of conspiracy to commit an alleged violation. See Mowbray v. Cameron County, Tex., 274 F.3d 269, 279-80 (5th Cir. 2001) (finding that because the police office "is entitled to qualified immunity for his actions," "the § 1983 conspiracy claim based on them must fail.").
Analyses of qualified immunity under 42 U.S.C. § 1983 apply equally to Bivens actions. See Wilson v. Layne, 526 U.S. 603, 609 (1999) (recognizing that the analysis is the same).
Once qualified immunity has been asserted, the plaintiff bears the burden of negating it. See Foster v. City of Lake Jackson, 28 F.3d 425, 429 (5th Cir. 1994). The plaintiff must show that there is a genuine issue as to whether the defendant "(1) violated a constitutional right that (2) was clearly established at the time of the violation (3) through conduct that was objectively unreasonable." Mowbray, 274 F.3d at 279-80; see also Weddle v. Ferrell, 2000 WL 256891, at *3 n. 1 (N.D. Tex. March 6, 2000) (noting "Some panels of the Fifth Circuit have condensed the qualified immunity analysis into two steps, but the relevant points of inquiry in each analysis are the same."). If the plaintiff fails to show a genuine issue with respect to each element, the official is entitled to qualified immunity. See Mowbray, 274 F.3d at 280 (finding that a police officer was entitled to qualified immunity because the plaintiff had failed to show a violation to a constitutional right).
2. Failure to Correct
Plaintiffs allege that OTS Defendants and FBI Agent Fazzio "were in possession of the examination workpapers" of OTS Defendant Lambert "that wholly contradicted, impeached and demonstrated that Tannery was committing perjury before the trial jury and they sat silent as the jury considered such evidence in convicting Plaintiffs on Count 10 of the indictment." (Resp. at 29; Third Am. Compl. at 71-73.) Plaintiffs claim that the failure to correct Tannery's testimony resulted in subornation of perjury.
A defendant's due process rights are violated when the prosecution knowingly uses perjured testimony at trial or allows untrue testimony to go uncorrected. See Faulder v. Johnson, 81 F.3d 515, 519 (5th Cir. 1996). "To obtain relief, the defendant must show that (1) the testimony was actually false, (2) the state knew it was false and (3) the testimony was material." Id. (citing Kirkpatrick v. Whitley, 992 F.2d 491, 497 (5th Cir. 1993)). If the prosecutor is aware of the untrue nature of the testimony, the prosecutor bears the burden of correcting that testimony. See Napue v. Illinois, 360 U.S. 264 (1959) (finding that a "failure of State to correct testimony known to be false violates due process"). If the prosecutor is unaware of the untrue nature of the testimony, other members of the prosecutorial team who are aware may be liable for allowing the untrue testimony to go uncorrected. See Burge v. Parish of St. Tammany, 187 F.3d 452, 480 n. 11 (5th Cir. 1999) ("suborning perjury and concealing exculpatory evidence by police officers were constitutional violations."); see also Luna v. Beto, 391 F.2d 329, 332 (5th Cir. 1967) (holding that the state was liable for allowing the testimony to go uncorrected based on a police officer's knowledge of the false nature of the testimony).
With regard to the first element of their claim, Plaintiffs must present evidence showing that Tannery's testimony was actually false in order to maintain their subornation of perjury claims. See Faulder, 81 F.3d at 519. Plaintiffs refer the Court to the Fifth Circuit's opinion in Fisher as evidence that Tannery's testimony was false. However, the Fifth Circuit did not state that Tannery's testimony was false, but rather found that the Branson 302 "was directly contradictory to what Tannery testified to both in the grand jury hearing and at trial." Fisher, 106 F.3d at 634. Plaintiffs conflate falsity with contradiction. Contradiction in witnesses' statements may present a credibility question for the jury but it does not necessarily constitute perjury. See United States v. Brown, 634 F.2d 819, 827 (5th Cir. 1981) (explaining that the proof that a witness's "testimony is challenged by another witness or is inconsistent with prior statements" is insufficient to establish due process violation); see also United States v. Miranne, 688 F.2d 980, 989 (5th Cir. 1982) ("finding that the differing testimony of two government witnesses presented at most a credibility question for the jury"); United States v. Martinez-Mercado, 888 F.2d 1484, 1492 (5th Cir. 1990) (contradictory testimony, standing alone, is not tantamount to perjury); Maki v. Dretke, 2004 WL 719146, at *1 (N.D. Tex. April 1, 2004) (same). Thus, Plaintiffs have not shown that Tannery's testimony was actually false.
Moreover, Plaintiffs fail to present evidence showing a genuine issue of fact on the second element, that OTS Defendants and FBI Agent Fazzio knew of Tannery's testimony when it occurred. All OTS Defendants have provided declarations stating that they did not plan nor encourage Tannery's testimony, nor were they contemporaneously aware of it. (Bruton Decl. at ¶ 9; Klein Decl. at ¶ 5; Lambert Decl. at ¶ 12; Nordstrom Decl. at ¶ 12; Riccobono Decl. at ¶ 5; Teed Decl. at ¶ 10.) In response, Plaintiffs allege that "Defendants coerced Tannery into testifying falsely against Plaintiffs." (Third Am. Compl. at 73.) However, Plaintiffs have failed to present evidence supporting this allegation or showing that OTS Defendants and FBI Agent Fazzio knew of Tannery's testimony when it occurred. Thus, Plaintiffs fail to show a genuine issue of fact or law on two elements of their claims that OTS Defendants and FBI Agent Fazzio suborned perjury. Consequently, OTS Defendants and FBI Agent Fazzio are entitled to summary judgment on Plaintiffs' claims for subornation of perjury.
F. Withholding Exculpatory Evidence
Plaintiffs also allege that all OTS Defendants, except Riccobono, and both FBI Agents withheld and conspired to withhold exculpatory evidence. (Third Am. Compl. at 65-75.) OTS Defendants and FBI Agents move for summary judgment on grounds of qualified immunity. As previously set forth, Plaintiffs must show a genuine issue of law or fact regarding whether OTS Defendants or FBI Agents "(1) violated a constitutional right that (2) was clearly established at the time of the violation (3) through conduct that was objectively unreasonable" to overcome qualified immunity Mowbray, 274 F.3d at 279-80; see also Foster, 28 F.3d at 429.
1. OTS Defendants
OTS Defendants argue that as a matter of law, they are not responsible for the withholding of exculpatory evidence and their actions were objectively reasonable because they submitted all evidence to the FBI. OTS Defendants have proffered declarations stating that they made available to the FBI all documents related to their regulatory examination of Bayside, and no materials were withheld from production to the FBI or the prosecutors. (OTS Defs. App. at 1-6.) Plaintiffs contend that OTS Defendants withheld the Branson 302, the Jaccar 302, other documents containing correspondence with Jaccar and Tannery regarding Tannery's alleged forgery, and documents regarding an investigation of fraud charges against governmental witness Joseph Courrege. (Third Am. Compl. at ¶¶ 132-143, 155-159.) As evidence of such withholding, Plaintiffs refer the Court to the Fifth Circuit's opinion in Fisher, Plaintiff Fisher's declaration, John Roger Coston's declaration, and a 1040-page, two-volume appendix.
Coston is a former agent with the Drug Enforcement Administration. His declaration presents his opinions on the manner in which a federal law enforcement officer should handle exculpatory evidence.
Plaintiffs argue that Fisher, which reversed Plaintiffs' convictions, stands as the "law of the case" that OTS Defendants withheld exculpatory evidence. (Resp. at 36-38.) The "law of the case" doctrine "is an exercise of judicial discretion which merely expresses the practice of the courts generally to refuse to reopen what has been decided." United States v. Phipps, 2004 WL 880154, at *3 (5th Cir. 2004). Although the Fifth Circuit found in Fisher that the Branson 302 was exculpatory, it did not address who was responsible for its late disclosure. See Fisher, 106 F.3d at 635. Rather, the Fifth Circuit referred to the "Government" as the responsible party:
Moreover, Fisher addressed only whether disclosure of the Branson 302 was a violation of Plaintiff Fisher's right to exculpatory evidence: "The Government's failure to release [the Branson 302] to the defense was error, and should have resulted in a new trial for Fisher." Fisher, 106 F.3d at 632-34. Fisher did not address whether the disclosure of the Branson 302 was a violation of Plaintiff Carney's rights.
In its indictment against Carney, Fisher, Noebel and Hughes, the Government charged they conspired to commit mail fraud, wire fraud, and bank fraud, and also conspired to make false statements to and obstruct the operation of the FHLBB and Office of Thrift Supervision. . . . The Government's failure to release this material information to the defense was error, and should have resulted in a new trial for Fisher.Id. at 627-635 (emphasis added). Thus, the Fisher court did not determine which members of the prosecution team withheld exculpatory evidence. Accordingly, Fisher does not stand as "law of the case" with respect to Plaintiffs' allegations that OTS Defendants were responsible for withholding exculpatory evidence.
a. OTS Defendants Teed, Lambert, and Nordstrom
Plaintiffs also refer the Court to Plaintiff Fisher's declaration, which repeats fifteen pages of argument from Plaintiffs' brief and states that OTS Defendants withheld exculpatory "e-mail traffic" from the FBI:
OTS personnel Mr. Teed, Mr. Lambert, Mr. Colburn [Nordstrom] with held [sic] evidence from the FBI investigators by with holding [sic] all the e-mail traffic provided in this case from the investigators. The documents contain significant Brady and Giglio material. I have personal knowledge of this from witnessing their deposition statements and reviewing the nearly 40,000 thousand [sic] images provided as discovery in this case. Their [OTS Defendants'] statements in the [sic] affidavits indicating they provided all the relevant documentation available to the FBI and Prosecutors is [sic] false.
(Fisher Decl. at 20.) Each OTS Defendant has submitted a declaration stating that he or she made available to FBI Agents all documents in their possession, control, or custody that were related to Plaintiffs. (OTS Defs. App. at 1-6.) They each claim that they did not decide what evidence was disclosed to Plaintiffs. Id.
Plaintiff Fisher's declaration conflicts with OTS Defendants' declarations. Ordinarily, Rule 56 does not authorize summary judgment when a court is faced with conflicting sworn statements. See Bowen v. GDMFC of Texas, Inc., 1999 WL 172291, at *4 (N.D. Tex. March 22, 1999) (citing Farbwerke Hoeschst A.G. v. M/V "Don Nicky", 589 F.2d 795, 798 (5th Cir. 1979) ("In making its [summary judgment] determination, the court may not weigh conflicting affidavits to resolve disputed fact issues.")). However, when an sworn statement is conclusory and not based on personal knowledge, then it is entitled to no weight. See Lujan, 497 U.S. at 888 ("The object of [Rule 56(e)] is not to replace conclusory allegations of the complaint or answer with conclusory allegations of an affidavit."); see also Akin v. Q-L Investments, Inc., 959 F.2d 521, 530 (5th Cir. 1992) (explaining that affidavits "shall be made on personal knowledge, shall set forth such facts as would be admissible in evidence, and shall show affirmatively that the affiant is competent to testify as to the matters stated therein.'"). "Affidavits that do not comply with these requirements are legally insufficient and are entitled to no weight." Williamson, 815 F.2d at 383.
OTS Defendants argue that Plaintiff Fisher's declaration is conclusory and fails to meet the requirements of FED. R. Civ. P. 56(e), and thus, should be accorded no weight. (OTS Defs. Reply at 2 n. 2.) Although Plaintiff Fisher refers to and has provided OTS Defendants Teed's, Lambert's, and Nordstrom's deposition transcripts, he does not cite the e-mails that were allegedly withheld nor a specific portion of these transcripts. Rather, Plaintiff Fisher makes the conclusory assertion that these e-mails contain "significant" exculpatory evidence as established by deposition testimony and some 40,000 images. (Fisher Decl. at 20.) The Court is not required to search the record to find support for Plaintiff Fisher's averments; rather, it "need rely only on those portions of the submitted documents to which the nonmoving party directs the Court's attention." Barnes, 2004 WL 691202, at *6; see also Ragas v. Tenn. Gas Pipeline Co., 136 F.3d 455, 458 (5th Cir. 1998) ("The party opposing summary judgment is required to identify specific evidence in the record and to articulate the precise manner in which that evidence supports his or her claim."). Whether evidence is exculpatory is a question for the Court, and Plaintiff Fisher does not direct the Court's attention to any particular allegedly exculpatory e-mail. In fact, Plaintiff Fisher fails to direct the Court's attention to any evidence showing that OTS Defendants Teed, Lambert, and Nordstrom withheld exculpatory evidence. It does not appear from Plaintiff Fisher's affidavit that he has personal knowledge of the withholding of any exculpatory evidence by these defendants.
Accordingly, Plaintiff Fisher's statement that OTS Defendants Teed, Lambert, and Nordstrom withheld exculpatory e-mails does not appear to be based on his personal knowledge, and the Court strikes this statement from the summary judgment evidence. See Strain v. Kaufman County Dist. Attorney's Office, 23 F. Supp.2d 685, 696 (N.D. Tex. 1998) (striking statements that were "self-serving and recount[ing] alleged occurrences of which Plaintiffs have no personal knowledge in violation of FED. R. CIV. P. 56(e).").
b. All OTS Defendants
Plaintiffs also allege that all OTS Defendants are liable for the withholding of Plaintiffs' Exhibits 1-17 and 19-23 as part of the "prosecutorial team." (Fisher Decl. at 8-17.) A Bivens action must be based upon the personal involvement of a particular individual, rather than group liability. See F.D.I.C. v. Meyer, 510 U.S. 471, 485 (1994) (explaining that it "must be remembered that the purpose of Bivens is to deter the officer."); see also Rivera v. Commandant of U.S. Marines Corps, 2000 WL 1581001, at *1 (D.C. Cir. Sept. 26, 2000) (noting that "to the extent appellant is suing a federal official in his individual capacity, the complaint does not allege any personal involvement") (citing Simpkins v. District of Columbia Gov't, 108 F.3d 366, 369 (D.C. Cir. 1997) (explaining that the complaint must allege personal involvement by government official in events giving rise to constitutional claim); Cameron v. Thornburgh, 983 F.2d 253, 258 (D.C. Cir. 1993) (same)); accord Davis v. United States, 2004 WL 324880, at *9 (S.D.N.Y. Feb. 19, 2004) ("Davis' failure to allege that Delia was personally involved in the complained of acts is fatal to his claim.").
Plaintiffs have presented no evidence showing personal involvement by each OTS Defendant with respect to the handling of Plaintiffs' Exhibits 1-17 and 19-23. Rather, Plaintiffs base their claims on impermissible allegations of group liability. Thus, even accepting Plaintiffs' allegations as true and construing all of the evidence in Plaintiffs' favor, allegations of group liability fail as a matter of law in a Bivens action. See F.D.I.C., 510 U.S. at 485; see also Cameron, 983 F.2d at 258.
Plaintiffs have failed to present competent summary judgment evidence showing that a genuine issue of fact or law exists as to whether each OTS Defendant withheld exculpatory evidence. Accordingly, each OTS Defendant is entitled to qualified immunity with regard to Plaintiffs' claims for withholding of exculpatory evidence, and summary judgment should be granted in favor of OTS Defendants on these claims. See Mowbray, 274 F.3d at 280 (finding that a police officer was entitled to qualified immunity because the plaintiff had failed to show a violation to a constitutional right). 2. FBI Agents
OTS Defendants should likewise be granted summary judgment on Plaintiffs' claim for conspiracy to withhold exculpatory evidence because OTS Defendants are qualifiedly immune from the underlying claim. See Mowbray, 274 F.3d at 280.
FBI Agents assert qualified immunity with regard to Plaintiffs' Brady violation claims. Plaintiffs must show a genuine issue with regard to whether FBI Agents were responsible for withholding exculpatory evidence. See Mowbray, 274 F.3d at 280 (concluding that the police officer was entitled to qualified immunity because the plaintiff had failed to show that the officer violated any constitutional right); see also Weddle, 2000 WL 256891, at *3 (noting that the plaintiff had stated a claim that the police officer violated his constitutional rights).
Plaintiffs again refer the Court to the Fifth Circuit's opinion in Fisher as evidence that FBI Agents withheld exculpatory evidence in violation of Plaintiffs' constitutional rights. As explained above, the Fifth Circuit did not attribute the untimely disclosure of the Branson 302 to any particular individual. See Fisher, 106 F.3d at 634-35. Accordingly, Fisher does not necessarily show a genuine issue with regard to whether FBI Agents were responsible for the late disclosure of the Branson 302.
Plaintiffs also refer the Court to Plaintiff Fisher's declaration. Plaintiff Fisher avers that FBI Agents decided what evidence would be provided to Plaintiffs and that FBI Agents provided all evidence to Plaintiffs:
At all relevant times during pre trial [sic] discovery for both criminal trials, I only obtained discovery and access to materials from the FBI through [FBI Agents]. At no time was I ever provided with discovery or access to evidentiary material by the prosecutors or US [sic] Attorney's office. The FBI, Gant and Fazio [sic], determined what materials were made available to our defense team. . . . The FBI agents decided what they produced[,] not the prosecutors[,] based upon my personal knowledge at the time.
(Fisher Decl. at 18.) FBI Agents have provided affidavits stating that they "did not make or participate in the decisions [regarding] . . . what documents, evidence, or other materials would be turned over to [Plaintiffs]. Such decisions were made exclusively by the prosecutors and/or their supervisors in the case." (FBI Agents App. at 1-2.)
Plaintiff Fisher's declaration conflicts with FBI Agents' affidavits. As discussed more fully with respect to the OTS Defendants, if Plaintiff Fisher's declaration is conclusory and not based on personal knowledge, then it is entitled to no weight. See Lujan, 497 U.S. at 888; see also Akin, 959 F.2d at 530; Williamson, 815 F.2d at 383. FBI Agents object to Plaintiff Fisher's declaration as conclusory, speculative, and made without his personal knowledge in violation of Rule 56. While Plaintiff Fisher may have personal knowledge that FBI Agents physically transferred evidence to him or his defense team, he does not explain the basis for his alleged personal knowledge regarding who made the decision to disclose exculpatory evidence. Plaintiffs have identified no supporting evidence in the record that FBI Agents made the disclosure decision. Plaintiff Fisher's statement that FBI Agents made the decision appears to be conclusory and speculative rather than based on his personal knowledge. Speculative or conclusory allegations are incompetent summary judgment evidence. See Loujan, 497 U.S. at 888, quoted in Savariego v. Melman, 2002 WL 1788012, at *2 n. 4 (N.D. Tex. May 10, 2002) (not recognizing unauthenticated hearsay in an affidavit as competent summary judgment evidence) (Lynn, J.). Because Plaintiff Fisher's allegation that FBI Agents decided what would be disclosed is without support in the record, the Court sustains FBI Agents' objections, and strikes this statement from the summary judgment evidence. See Strain, 23 F. Supp.2d at 696 (striking statements as "self-serving and recount[ing] alleged occurrences of which Plaintiffs have no personal knowledge in violation of FED. R. CIV. P. 56(e).").
Plaintiffs present no other evidence supporting their contention that FBI Agents withheld exculpatory evidence. Because Plaintiffs have failed to identify any competent summary judgment evidence in the record that raises a genuine issue of fact or law regarding whether FBI Agents withheld exculpatory evidence, Plaintiffs have failed to show that FBI Agents violated their constitutional rights. Accordingly, FBI Agents are entitled to qualified immunity from Plaintiffs' claims that they withheld exculpatory evidence. See Mowbray, 274 F.3d at 280 (finding that a police officer was entitled to qualified immunity because the plaintiff had failed to show a violation to a constitutional right). Because the FBI Agents are entitled to qualified immunity from the underlying claim, they are also entitled to immunity from Plaintiffs' claim for conspiracy to withhold exculpatory evidence. See id. Accordingly, FBI Agents' motion for summary judgment on the basis of qualified immunity should be granted.
III. RECOMMENDATION
For the foregoing reasons, the court RECOMMENDS that the Motion for Summary Judgment on Behalf of Karen Bruton, Kenneth Klein, Bradford Lambert, Rolf Nordstrom, Richard Riccobono and Frederick Teed be GRANTED, the Motion for Summary Judgment of Defendants Vincent G. Fazzio and Jennifer Gant be GRANTED, and this action be DISMISSED with prejudice against defendants Karen Bruton, Kenneth Klein, Bradford Lambert, Rolf Nordstrom, Richard Riccobono, Frederick Teed, Vincent Fazzio, and Jennifer Gant.