FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
TIMOTHY LEE WARD, No. 07-17156
Plaintiff-Appellant,
v. D.C. No.
CV-01-02226-ROS
CHARLES L. RYAN, Director,
OPINION
Defendant-Appellee.
Appeal from the United States District Court
for the District of Arizona
Roslyn O. Silver, District Judge, Presiding
Argued and Submitted
January 12, 2010—San Francisco, California
Filed September 27, 2010
Before: Alex Kozinski, Chief Judge, J. Clifford Wallace and
Richard R. Clifton, Circuit Judges.
Opinion by Judge Clifton
16527
16530 WARD v. RYAN
COUNSEL
Beau Sterling, Las Vegas, Nevada, for the plaintiff-appellant.
Michele L. Forney, Phoenix, Arizona, for the defendant-
appellee.
OPINION
CLIFTON, Circuit Judge:
Timothy Lee Ward, an inmate held by the Arizona Depart-
ment of Corrections (“Department”), appeals from the district
court’s summary judgment in favor of the Director of the Depart-
ment.1 Ward alleges that the Department’s withdrawal of
$50.00 from his prison wages pursuant to an Arizona statute
that requires that amount of money be placed in a dedicated
discharge account, to be paid to him upon his release from
incarceration, violates the Fifth and Fourteenth Amendments.
He seeks immediate access to the funds, because his 197-year
sentence makes it unlikely that he will ever be released prior
to his death. The district court denied Ward’s claim. We
affirm.
I. Background
Ward was sentenced to 197 years in the custody of the
Department as a result of twenty-two felony convictions. As
a prisoner who works, Ward is entitled under Arizona law to
compensation at a rate to be determined by the Director. Ariz.
Rev. Stat. § 31-254(A). For the most part, this compensation
is placed in the inmate’s spendable account and may be with-
drawn for certain enumerated purposes, such as inmate store
1
Charles L. Ryan is substituted for former Director Dora Schriro, who
had herself been substituted for former Director Terry L. Stewart.
WARD v. RYAN 16531
purchases or long distance telephone calls. Withdrawal of
funds requires approval by prison officials.
Pursuant to Section 31-237(A) of the Arizona Revised Stat-
utes, a percentage of the wages earned by a prisoner must be
deposited by the Department into a separate account, called a
dedicated discharge account, until that account registers a
$50.00 balance. The money held in this account is not avail-
able for the prisoner to spend while he in prison but will be
distributed to him as “gate money” when he is discharged or
is transferred to community release or home arrest. See Ariz.
Rev. Stat. § 31-237(B). If a prisoner dies in prison, the gate
money is applied to cremation costs or other related expenses,
and any remaining funds are released to his estate or heir.2 As
required by the Arizona statute, $50.00 was withheld from
Ward’s prison wages and is held by the Department in his
dedicated discharge account.
Ward filed pro se a 42 U.S.C. § 1983 civil rights suit
against the Director alleging denial of access to the courts in
violation of the Sixth Amendment. He amended his complaint
to add a claim that the withholding of his wages constituted
a violation of the Eighth Amendment and sought both com-
pensatory and punitive damages against the Director, as well
as injunctive relief. Ward’s complaint was dismissed by the
district court for failure to state a claim. Ward appealed the
dismissal to this court. We affirmed the dismissal of the
access-to-courts claim but reversed the dismissal of the due-
process claim, remanding for further proceedings, which will
2
Department Order 711.05, providing for the disposal of a deceased
inmate’s property, was amended effective April 16, 2009. It supercedes
the previous 2007 version of the order, which was cited in the district
court’s decision below. The current version makes no specific mention of
the proposition that dedicated discharge account funds will be applied first
to a deceased inmate’s cremation costs, suggesting that the funds may sim-
ply be released to the prisoner’s estate or heir. This amendment has no
effect on our decision.
16532 WARD v. RYAN
be more fully described below.3 See Ward v. Stewart, 81 F.
App’x 229 (9th Cir. 2003) (unpublished).
After the case returned to district court, the Director moved
for summary judgment on the due-process claim, asserting
that he was entitled to qualified and sovereign immunity. The
district court granted partial summary judgment in the Direc-
tor’s favor, holding that the Director was entitled to qualified
immunity regarding his personal liability and to sovereign
immunity for his official actions. The court also granted sum-
mary judgment for the Director on Ward’s due-process claim
for punitive damages. The court did not at that point grant
summary judgment on Ward’s claim for injunctive relief,
instead ordering supplemental briefing on that issue.
In his supplemental brief Ward for the first time alleged
violations of his Fifth and Fourteenth Amendment rights
against the government’s taking of property without just com-
pensation. Following consideration of Ward’s claims, includ-
ing the new takings claim,4 the district court denied Ward’s
request for injunctive relief and dismissed the remainder of
his claims.
This appeal followed.5
II. Discussion
We review the district court’s summary judgment de novo.
See Universal Health Servs., Inc. v. Thompson, 363 F.3d
3
The district court interpreted Ward’s Eighth Amendment claim as a
due-process claim, and we followed this interpretation.
4
The district court elected to consider Ward’s takings claim because the
allegations of a pro se complaint are held to a less stringent standard,
Haines v. Kerner, 404 U.S. 519, 520 (1972) (per curiam), and because the
Director had the opportunity to respond to Ward’s takings claim in his
supplemental reply brief.
5
In this appeal Ward has been represented by counsel appearing pro
bono.
WARD v. RYAN 16533
1013, 1019 (9th Cir. 2004). Our review is governed by the
same standard used by the trial court under Federal Rule of
Civil Procedure 56(c). Adcock v. Chrysler Corp., 166 F.3d
1290, 1292 (9th Cir. 1999). “We must determine, viewing the
evidence in the light most favorable to the nonmoving party,
whether there are any genuine issues of material fact and
whether the district court correctly applied the relevant sub-
stantive law.” Universal Health Servs., 363 F.3d at 1019
(internal quotation marks omitted). Where, as here, the under-
lying facts are not in dispute, we are left to determine whether
the district court correctly applied the law. Id.
[1] Ward’s primary argument on appeal is that the with-
holding of the $50 for gate money constituted a taking of his
private property in violation of his constitutional rights. The
Takings Clause of the Fifth Amendment prohibits the govern-
ment from taking private property for public use without just
compensation. This right is applicable to the states through
the Due Process Clause of the Fourteenth Amendment.
Webb’s Fabulous Pharmacies, Inc. v. Beckwith, 449 U.S. 155,
160 (1980).
[2] To establish a violation of the Takings Clause, Ward
must first demonstrate he has a property interest that is consti-
tutionally protected. Schneider v. Cal. Dep’t of Corr. (Schnei-
der II), 151 F.3d 1194, 1198 (9th Cir. 1998). “Only if [the
plaintiff] does indeed possess such an interest will a review-
ing court proceed to determine whether the expropriation of
that interest constitutes a ‘taking’ within the meaning of the
Fifth Amendment.” Id. Property interests are not constitution-
ally created; rather, protected property rights are “created and
their dimensions are defined by existing rules or understand-
ings that stem from an independent source such as state law.”
Bd. of Regents of State Coll. v. Roth, 408 U.S. 564, 577
(1972).
[3] Inmates forfeit many of their traditional rights to prop-
erty. See Givens v. Ala. Dep’t of Corr., 381 F.3d 1064, 1068
16534 WARD v. RYAN
(11th Cir. 2004). And inmates did not have a protected prop-
erty interest in their wages at common law. See Calero-
Toledo v. Pearson Yacht Leasing Co., 416 U.S. 663, 682
(1974). The Supreme Court of Arizona has recognized, how-
ever, that Arizona created a protected property interest in
inmate wages by statute. See Zuther v. State, 14 P.3d 295, 302
(Ariz. 2000); Ariz. Rev. Stat. § 31-254(A) (“Each prisoner
who is engaged in productive work . . . shall receive for the
prisoner’s work the compensation that the director deter-
mines.”). It is thus undisputed that Ward has a protected prop-
erty interest in his prison wages.
[4] Nonetheless, courts have consistently held that such
statutes granting inmates a protected property interest in their
wages may also limit and define the contours of such interest.
See, e.g., Washlefske v. Winston, 234 F.3d 179, 185 (4th Cir.
2000) (“[A]n inmate has no property interest in any ‘wages’
from his work in prison except insofar as the State might
elect, through statute, to give him rights.”); Rochon v. La.
State Penitentiary Inmate Account, 880 F.2d 845, 846 (5th
Cir. 1989) (“[Petitioner] receives incentive wages solely
because of the state statutory scheme. Thus, the nature of his
property interest in those funds may be defined by the reason-
able provisions of that legislation.”); see also Givens, 381
F.3d at 1069-70 (holding that the statutory provisions creating
a property interest in inmate wages do not create an interest
in the interest accrued on their accounts); Allen v. Cuomo, 100
F.3d 253, 261-62 (2d Cir. 1996) (holding that the statute pro-
viding for payment of inmate wages did not create an entitle-
ment in access to wages prior to release); Hrbek v. Farrier,
787 F.2d 414, 416 (8th Cir. 1986) (holding that the statutory
scheme allowed for deductions from prison wages and stating
that the “statutory provisions clearly establish that [petitioner]
can assert no legitimate claim of entitlement to the full
amount of his wages based upon state law”).
In Tellis v. Godinez, 5 F.3d 1314 (9th Cir. 1993), we con-
sidered a Nevada inmate’s right to interest earned on money
WARD v. RYAN 16535
deposited in his personal property fund. In holding that the
inmate did have a constitutionally protected property interest,
we determined that we needed to look not only at the plain
language of the section of the statute providing for the
inmate’s property interest, but also its context within the sur-
rounding statutory framework. Id. at 1316-17 (“[T]he statute
is to be read as a whole, since the meaning of statutory lan-
guage, plain or not, depends on context.”) (internal quotation
marks omitted).
[5] In turning to the Arizona statutory framework, we
begin by observing that in Zuther, the Supreme Court of Ari-
zona rejected a challenge by a different Department inmate to
the same gate-money requirement that is at issue in this case.
While recognizing that the inmate had a statutorily-created
property interest in his wages, the Arizona court held that the
inmate had “no constitutional right to possess that property
while in prison, and [that] the delay in access to the amount
withheld [was] at most a de minimus deprivation.” Zuther, 14
P.3d at 302.
We pointed out in our previous decision in this case, how-
ever, that Zuther might not be dispositive here because Zuther
had actually been released and granted access to the withheld
funds, see id. at 298 n.2, while Ward is serving a 197-year
sentence and therefore will probably never gain personal
access to the funds. Ward, 81 F. App’x at 229.
On remand, the district court considered the consequences
of Ward’s particular sentence on the withholding of wages in
the dedicated discharge account and concluded that the appli-
cation of the requirement did not alter the outcome for two
reasons. First, even prisoners sentenced to life imprisonment
are sometimes able to obtain release prior to expiration of
their natural life through reversal of their conviction or sen-
tence on appeal; reprieve, commutation, or pardon; or a
reduction of sentence by subsequent law. Second, funds held
in a dedicated discharge account for an inmate who dies in
16536 WARD v. RYAN
prison are applied to his cremation or other final expenses,
and any remaining funds inure to his estate. We agree with the
district court’s conclusion.
[6] Arizona statutes impose several limitations on an
inmate’s spending of his wages and delineate mandatory
deductions from inmates’ accounts. These limitations and
mandatory deductions indicate the state’s intent to place
restrictions on an inmate’s control over the wages he has
earned. Section 31-254 of the Arizona Revised Statutes leaves
the amount of compensation for inmate work to the discretion
of the Director. Ariz. Rev. Stat. § 31-254(A). The statute pro-
vides for mandatory deductions from inmate wages, not only
for the dedicated discharge account, but also for court costs,
room and board costs, and court ordered dependent care. Id.
§ 31-254(D), (E). The Director is also given explicit authority
to regulate inmate usage of the funds in prisoner spendable
accounts. Id. § 31-230(B) (“The director shall adopt rules for
the disbursement of monies from prisoner spendable
accounts.”). Additionally, the statute creating the dedicated
discharge account does not provide for exceptions or adjust-
ments based on the length of an inmate’s sentence. Id. § 31-
237.
[7] These statutes clearly establish a framework under
which inmates’ property interest in their wages is limited by
the oversight of the Director and is subject to mandatory
deductions. The statutes do not give inmates a full and unfet-
tered right to their property but rather restrict their control
over their earnings. Accordingly, Ward does not possess a
protected property interest in the immediate access to wages
held in his dedicated discharge account, because he does not
currently have the statutory right to use these funds in the
account. Ward’s life sentence does not alter this outcome.
While these funds are Ward’s property, the Director may
properly restrict his access to them without offending tradi-
tional notions of property law.
WARD v. RYAN 16537
Ward argues that even if a statute does not explicitly create
a property interest, such right may nonetheless still exist. That
is true. We held in Schneider II that courts must consider
whether the claimed property interest is “a ‘core’ notion of
constitutionally protected property into which state regulation
simply may not intrude without prompting Takings Clause
scrutiny.” 151 F.3d at 1200. Property’s “core” meaning is
determined “by reference to traditional ‘background princi-
ples’ of property law.” Id. at 1201.
In Schneider II we examined the California Department of
Corrections’ failure to pay interest on funds deposited in
inmate trust accounts. Id. at 1195. We held that “[t]he ‘inter-
est follows principal’ rule’s common law pedigree . . . leaves
us with little doubt that interest income of the sort at issue
here is fundamental that States may not appropriate it without
implicating the Takings Clause.” Id. In the fourth round of lit-
igation in Schneider, we held that California’s failure to pay
interest was therefore a taking under the Fifth Amendment
where the interest was diverted to a common inmate welfare
fund. Schneider v. Cal. Dep’t of Corr. (Schneider IV), 345
F.3d 716, 719-21 (9th Cir. 2003).
[8] Ward’s claim does not concern a “core notion of con-
stitutionally protected property.” As we previously explained,
under common law prison inmates lost their rights to unfet-
tered control and use of private property. The dedicated dis-
charge account, while not currently accessible by Ward, is
being held for Ward’s benefit. It will be paid to him upon dis-
charge, used for his final expenses, or left to his heir. It has
not and will not be taken and used by the government for its
own benefit or for the benefit of anyone else, unlike the inter-
est income in the Schneider cases, which was permanently
taken by the California Department of Corrections and placed
in a common fund to be used for the inmate population as a
whole. In light of Ward’s limited property right in his wages
and the fact he has not suffered a permanent taking of his
wages by their placement in a dedicated discharge account,
16538 WARD v. RYAN
Ward has not stated a claim for the unconstitutional taking of
his property. The dedicated discharge account here thus dif-
fers from inmate accounts at issue in other cases where we
held that the Takings Clause was implicated. See, e.g., Schnei-
der IV, 345 F.3d at 719-21; McIntyre v. Bayer, 339 F.3d 1097,
1099-1100 (9th Cir. 2003) (holding that pooling interest on
Nevada inmate trust accounts and requiring inmates to con-
tribute a portion of their wages to a victims’ compensation
fund implicated the Takings Clause).
[9] Ward also makes a due process claim, but that is not
viable either. To establish a due process violation, an inmate
“must demonstrate that [he] ha[s] been deprived of a pro-
tected liberty or property interest by arbitrary government
action.” McKinney v. Anderson, 924 F.2d 1500, 1510 (9th Cir.
1991), vacated on other grounds by Helling v. McKinney, 502
U.S. 903 (1991). As discussed above, Ward does not have a
protected property interest in the current use of the funds in
the dedicated discharge account, and he has not been perma-
nently deprived of any property interest. Furthermore, the
government’s action here is not arbitrary; as the district court
pointed out, “[g]ate money promotes public welfare and the
common good by aiding inmates’ integration into society and
removing the immediate temptation to acquire needed funds
through illegal means.”
III. Conclusion
[10] Ward does not have a current possessory property
interest in the wages withheld in the dedicated discharge
account and he has not been permanently deprived of those
funds, so the Department’s withholding of the $50.00 from
his wages for gate money does not violate his constitutional
rights. The district court properly granted summary judgment
for the Director. Because of our resolution of that issue, we
do not need to address the separate arguments regarding qual-
ified immunity and punitive damages.
AFFIRMED.