Sperry v. Werholtz

                                                                      FILED
                                                          United States Court of Appeals
                                                                  Tenth Circuit

                                                                 April 16, 2009
                    UNITED STATES COURT OF APPEALS
                                                 Elisabeth A. Shumaker
                                                                  Clerk of Court
                                 TENTH CIRCUIT



 JEFFREY J. SPERRY,

               Plaintiff - Appellant,                   No. 08-3274
          v.                                            (D. Kansas)
 ROGER WERHOLTZ, Secretary,                   (D.C. No. 5:04-CV-03125-CM)
 Kansas Department of Corrections, in
 his individual and official capacity,

               Defendant - Appellee.


                            ORDER AND JUDGMENT *


Before HARTZ, McKAY, and O’BRIEN, Circuit Judges.


      Jeffrey Sperry, an inmate in the custody of the Kansas Department of

Corrections (KDOC), brought this pro se action under 42 U.S.C. § 1983 in the

United States District Court for the District of Kansas against Roger Werholtz,




      *
       After examining the briefs and appellate record, this panel has determined
unanimously that oral argument would not materially assist the determination of
this appeal. See Fed. R. App. P. 34(a)(2); 10th Cir. R. 34.1(G). The case is
therefore ordered submitted without oral argument. This order and judgment is
not binding precedent except under the doctrines of law of the case, res judicata,
and collateral estoppel. It may be cited, however, for its persuasive value
consistent with Fed. R. App. P. 32.1 and 10th Cir. R. 32.1.
Secretary of KDOC (the Secretary). 1 Mr. Sperry challenged two Kansas prison

rules. One is a regulation that bans the possession of sexually explicit materials

by inmates in state correctional facilities. He contended that this regulation

violates his First Amendment right to freedom of expression, his Fourth

Amendment right to freedom from illegal seizures, and his Fourteenth

Amendment right to due process of law. The second is a prison policy requiring

each Kansas inmate to place 10% of funds received from sources outside of

KDOC into a “mandatory savings account” for the prisoner’s use when he is

released from prison. R. Vol. 2 at 71. He contended that this policy violates his

Fourth Amendment right to freedom from illegal seizures and his Fourteenth

Amendment right to due process of law. He also contended that this policy

constitutes criminal deprivation of property, conversion, and illegal taxation

under Kansas law.

      On July 6, 2007, the district court granted summary judgment to the

Secretary on all claims relating to the ban on sexually explicit materials,

concluding that Mr. Sperry lacked standing to challenge the regulation. On

September 12, 2008, the court granted summary judgment to the Secretary on


      1
        Mr. Sperry was originally joined in this action by three fellow inmates in
the custody of KDOC. The district court dismissed the entire action for failure to
exhaust administrative remedies. We affirmed the dismissal as to the three other
inmates. But because Mr. Sperry had exhausted administrative remedies, we
reversed and remanded his claims to the district court. See McGoldrick v.
Werholtz, 185 F. App’x 741 (10th Cir. 2006).

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Mr. Sperry’s Fourteenth Amendment challenge to the mandatory-savings policy,

concluding that it did not violate his substantive or procedural due-process rights.

That same day, the court also entered an order concluding that Mr. Sperry’s

remaining challenges to the mandatory-savings policy were waived because they

were omitted from the pretrial order.

      Mr. Sperry appeals the district court’s summary-judgment orders and its

conclusion that his Fourth Amendment and state-law challenges to the mandatory-

savings policy were waived. He contends (1) that he suffered an injury-in-fact

sufficient to establish standing to challenge the ban on sexually explicit materials;

(2) that he has been permanently deprived of the funds in his mandatory savings

account in violation of his rights to substantive and procedural due process

because he is serving a life sentence and will therefore never get the money; and

(3) that dismissal of his other claims on the ground that they were waived was

improper because he was assured at the final pretrial conference that the pretrial

order encompassed all the claims raised in his complaint. We have jurisdiction

under 28 U.S.C. § 1291. We hold that Mr. Sperry established his standing to

challenge the regulation regarding sexually explicit material, so we must reverse

and remand for further proceedings on that claim. In all other respects, we affirm

the judgment below.




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I.    BAN ON SEXUALLY EXPLICIT MATERIALS

      Mr. Sperry challenges Kansas Administrative Regulation (KAR) 44-12-313,

which was amended, effective April 1, 2004, to prohibit the possession of

sexually explicit materials by inmates in state correctional facilities. He contends

that the amended regulation violates his First, Fourth, and Fourteenth Amendment

rights. The district court ruled that Mr. Sperry lacked standing because he had

failed to allege that KDOC had seized or threatened to seize his materials, or that

there was an immediate danger that KDOC would seize his materials.

      We disagree. On April 1, 2004, KDOC officials set a May 1 deadline for

inmates to destroy or dispose of sexually explicit materials in their possession.

Mr. Sperry possessed sexually explicit materials, which he mailed to the district

court on April 29, 2004—just before the regulation became effective—to comply

with the regulation and to serve as evidence in this case. The natural inference

from these events is that KDOC would discipline inmates who possessed sexually

explicit material after May 1, 2004, and that Mr. Sperry would have had such

material on that date if he had not exercised self-censorship. These circumstances

suffice to establish Mr. Sperry’s standing to challenge the regulation. See

Virginia v. Am. Booksellers Ass’n, Inc., 484 U.S. 383, 393 (1988) (book seller had

standing to challenge statute even before effective date, when state did not

suggest that statute would not be enforced and danger of self-censorship can be

realized even without prosecution); Ward v. Utah, 321 F.3d 1263, 1264 (10th Cir.

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2003); Am. Civil Liberties Union v. Johnson, 194 F.3d 1149, 1154–55 (10th Cir.

1999); Meisberger v. Donahue, 245 F.R.D. 627, 629 (S.D. Ind. 2007).

      We therefore reverse the district court’s grant of summary judgment on this

issue and remand for further proceedings.

II.   MANDATORY-SAVINGS POLICY

      Mr. Sperry also challenges KDOC Internal Management Policy and

Procedure (IMPP) 04-103, which requires Kansas inmates to place 10% of all

funds received from sources outside of KDOC into a “mandatory savings

account.” R. Vol. 2 at 71. While incarcerated, an inmate has very limited access

to funds in this account. The funds and any accrued interest are provided to the

inmate upon his release or, if the inmate dies while in custody, to his estate.

Mr. Sperry claims that this mandatory-savings policy deprives him of both

substantive and procedural due process.

      We first address the substantive-due-process claim. A prison regulation

does not violate a prisoner’s substantive-due-process rights unless the prisoner

proves that the regulation lacks “a rational relation to legitimate penological

interests.” Overton v. Bazzetta, 539 U.S. 126, 132 (2003) (upholding restrictions

on visitation). In Steffey v. Orman, 461 F.3d 1218 (10th Cir. 2006) we upheld a

prison regulation that prohibited inmates from receiving money from family

members of other inmates because the regulation served a “legitimate penological

interest in preventing inmates from using their family members to pay off their

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drug, gambling or other debts to fellow inmates, or from extorting money from an

inmate’s family with threats of harm.” Id. at 1222.

      KDOC has asserted that its mandatory-savings policy is intended to

“enhance success” of inmates upon their release from custody. R. Vol. 1 at 62.

Mr. Sperry does not contend that this is not a legitimate penological interest.

Rather, he contends that this interest does not apply to him because he is serving

a life sentence. But Mr. Sperry is not serving a life sentence without parole; there

is a possibility that he will be released. He admits that he will “see the parole

board [in] 18 years.” Id. at 60. Even if his release is “a great many years into the

future,” Aplt. Br. at 22, KDOC retains a legitimate interest in providing

Mr. Sperry with a source of funds upon his release to ease his transition into

society. Accordingly, we reject Mr. Sperry’s substantive-due-process claim.

      Mr. Sperry’s procedural-due-process claim is that he was entitled to a

hearing before the money he received was moved to a mandatory savings account.

When evaluating whether an individual’s procedural-due-process rights were

violated, we consider (1) whether the individual possessed a protected property

interest and (2) whether the individual was afforded an appropriate level of

process. See Camuglia v. City of Albuquerque, 448 F.3d 1214, 1219 (10th Cir.

2006). We assume, without deciding, that Mr. Sperry had a protected property

interest in the money he received from outside of KDOC. See Gillihan v.

Shillinger, 872 F.2d 935, 938 (10th Cir. 1989) (inmate had property interest in

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“monies received from friends and family outside the prison”). Even so, he

received all the process he was due. No hearing was necessary to determine

whether 10% of the money received belongs in the savings account. IMPP

04-103 is a general prison policy applicable to all KDOC inmates. There would

be no factual issue to resolve if Mr. Sperry were provided a hearing. He does not

dispute that he is a KDOC inmate and that the money came from outside the

prison. Thus, the matter was effectively decided when the policy itself was

enacted. And Mr. Sperry had no right to participate in the enactment process.

See Bi-Metallic Inv. Co. v. State Bd. of Equalization, 239 U.S. 441, 445 (1915)

(“Where a rule of conduct applies to more than a few people, it is impracticable

that everyone should have a direct voice in its adoption.”); Okla. Educ. Ass’n v.

Alcoholic Beverage Laws Enforcement Comm’n, 889 F.2d 929 (10th Cir. 1989)

(individual state employees had no procedural-due-process right to a hearing to

challenge state law prohibiting all state employees from working in liquor

industry).

       We therefore affirm the district court’s order granting summary judgment

to the Secretary on Mr. Sperry’s due-process challenges to the mandatory-savings

policy. 2


       2
       Mr. Sperry’s brief on appeal also complains that the funds of all prisoners
in mandatory savings accounts are pooled. But we can discern no constitutional
claim based on this factual allegation. Mr. Sperry does not suggest that his
personal funds are not accounted for separately.

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III.   OTHER CLAIMS

       Finally, Mr. Sperry appeals the district court’s ruling that his Fourth

Amendment and state-law challenges to the mandatory-savings policy were not

included in the pretrial order and were therefore waived. Federal Rule of Civil

Procedure 16(d) dictates that the pretrial order “controls the course” of the

litigation, unless modified by the court. “[C]laims, issues, defenses, or theories

of damages not included in the pretrial order are waived even if they appeared in

the complaint.” Wilson v. Muckala, 303 F.3d 1207, 1215 (10th Cir. 2002).

       Mr. Sperry contends that he did not waive any claims because he approved

the pretrial order only “with the court’s understanding that it encompasse[d] all of

the claims [he] ha[d] raised in his complaint.” Aplt. Br. at 12. Yet he provides

no evidentiary support for this assertion. One cannot reasonably read the pretrial

order as setting forth any state-law claims or claims based on the Fourth

Amendment. With respect to the governing law, the pretrial order states that “the

parties believe and agree the substantive issues in this case are governed by the

Fourteenth Amendment to the United States Constitution.” R. Vol. 3 at 244. This

statement clearly forecloses any state-law claims. True, the Fourteenth

Amendment incorporates the Fourth Amendment as applied to the States; but the

pretrial order’s section that summarizes Mr. Sperry’s theories of recovery

mentions nothing that could be construed as relating to the law governing search




                                         -8-
and seizure. Hence, we agree with the district court that Mr. Sperry waived his

Fourth Amendment and state-law challenges to the mandatory-savings policy.

IV.   CONCLUSION

      We REVERSE the summary judgment on Mr. Sperry’s challenges to the

sexually-explicit-material regulation and REMAND for further proceedings on

that claim; but we AFFIRM the remainder of the judgment below.

                                      ENTERED FOR THE COURT


                                      Harris L Hartz
                                      Circuit Judge




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