Tomaiolo v. Mallinoff

United States Court of Appeals
For the First Circuit
____________________

No. 01-1456

MARIE E. TOMAIOLO, ET AL.,

Plaintiffs, Appellants,

v.

MICHAEL D. MALLINOFF, ET AL.,

Defendants, Appellees.

____________________

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF RHODE ISLAND

[Hon. Ronald R. Lagueux, U.S. District Judge]

____________________

Before

Torruella, Lynch, and Lipez, Circuit Judges.

____________________

Thomas W. Kelly for appellants.

Marc DeSisto with whom Kathleen M. Powers was on brief for
appellees Michael D. Mallinoff, Joel Johnson, David B. Okun, John Day,
Audrey Cornell, George Cross, Pamela J. Fontaine, Jane A. Steere,
Frances Shocket, Claudette A. Paine, William A. Hanlon, David L.
Krugman, Henrietta T. Delaga, Carolyn A. Joaquin, Doris M. Yeaw,
Janette H. Hopkins, Dorothy E. Caldwell, Kenneth L. Richardson Jr.,
Robert E. Gordon, Diane Larisa, Dennis Finlay, Maryann Packer, Nancy
Mello, Kathleen A. Raposa, Carol A. Touzin, John Mainville, Bruce
Young, and the towns and cities of Barrington, Bristol, Central Falls,
Coventry, Cumberland, Exeter, Foster, Glocester, Jamestown, Lincoln,
Middletown, Narragansett, North Smithfield, West Warwick, Scituate,
Charlestown, Johnston, Pawtucket, Portsmouth, Smithfield, South
Kingstown, Tiverton, Warren, Woonsocket, and Burrillville, Rhode
Island.

Mark W. Freel with whom Annemarie M. Carney and Edwards &
Angell, LLP were on brief for appellees Transamerica Corporation, James
Houghton, Mark Williams, and Beni Osuna.

____________________

February 19, 2002
____________________
 LYNCH, Circuit Judge. Twenty-three owners of real

property in Rhode Island were disadvantaged by being part of a

group required to pay their real estate taxes annually rather

than quarterly. These property owners, whose mortgage companies

held their tax payments in escrow, were required to pay taxes in

one lump sum; other property owners, who paid their taxes

directly to the municipalities, could choose to pay quarterly.

The quarterly payment method is more favorable to the taxpayer

because it permits the taxpayer to receive the interest on the

escrowed funds until the quarter in which payment is due.

The desires of aggrieved local taxpayers to assert

their claims against municipal tax collectors in federal court

are pitted against the comity interests urging restraint in the

exercise of federal court jurisdiction over state tax matters.

The comity interests prevail: the plaintiffs are left to the

recourse available to them in state court. We reject as well

the claim that certain private actors are state actors and

affirm the dismissal of pendent state claims.

I.

The escrow accounts relevant to this case were held by

federally regulated banks, mortgage companies, and escrow

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agents. Under the authority of the Real Estate Settlement

Procedures Act (RESPA), 12 U.S.C. §§ 2601-2617 (2000), the

federal Department of Housing and Urban Development (HUD), has

promulgated a regulation, known as Regulation X, which reads in

relevant part:

For the payment of property taxes from the escrow
account, if a taxing jurisdiction offers a servicer a
choice between annual and installment disbursements,
the servicer must also comply with this paragraph
(k)(3). If the taxing jurisdiction neither offers a
discount for disbursements on a lump sum annual basis
nor imposes any additional charge or fee for
installment disbursements, the servicer must make
disbursements on an installment basis.

63 Fed. Reg. 3214, 3237 (Jan. 21, 1998) (emphasis added)

(codified at 24 C.F.R. § 3500.17(k)(3) (2001)).1 This

requirement benefits the borrower because quarterly payment

1 We note that HUD issued the rule containing the
language we quote in January 1998, after some but not all of the
events relevant to this litigation had already occurred. HUD
states in its contemporaneous summary of the 1998 rule that this
language merely clarifies its earlier rule, issued in October
1994. See 63 Fed. Reg. 3214, 3214 ("[T]his rule maintains the
current requirements under Regulation X, but clarifies them.");
see also 59 Fed. Reg. 53,890, 53,893 (Oct. 26, 1994) ("Unless
there is a discount to the borrower for early payments, the
regulation does not allow servicers to pay installment payments
on an annual or other prepayment basis."). Exactly what rule
was in force at what time could be important to a resolution of
this case on the merits. Our view of the case, however,
requires no further discussion of the matter.

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generally makes more sense for borrowers than does an up-front

lump sum annual payment. The following paragraph of the

regulation permits the borrower and loan servicer to agree

otherwise, provided the agreement is voluntary and uncoerced.

24 C.F.R. § 3500.17(k)(4). RESPA regulates the mortgage and

escrow companies; it does not regulate municipalities.

After the passage of Regulation X, many lenders in

Rhode Island continued to make annual, rather than quarterly,

payments of property taxes from escrow accounts. The difference

in treatment between payments from escrow accounts and direct

payments from taxpayers had arisen because the taxing

municipalities took the position that taxpayers who paid through

escrow accounts were not "persons assessed" entitled to make

payment on a quarterly basis under the relevant statute, R.I.

Gen. Laws § 44-5-7.2 On this interpretation of Rhode Island law,

2
At the time, that section provided in its entirety:

Every city and town shall make provision for the
payment in installments of any tax levied under the
provisions of § 44-5-1 by adding to and making a part
of the resolution ordering the assessment and the
collection of the tax an option permitting persons
assessed to pay their taxes in equal quarterly
installments if they so desire, the amounts and dates
for payment of the installments to be specified in the

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the municipalities were not "taxing jurisdiction[s which]

offer[ed] . . . a choice," 24 C.F.R. § 3500.17(k)(3), between

annual and quarterly payment, so that Regulation X did not

apply. Understandably unhappy with the "overescrowing" of their

accounts, the taxpayers took their problem to the Attorney

General of Rhode Island, who agreed with them that Rhode Island

law, properly read, did not permit a distinction between the two

groups of taxpayers. In 1998 the Attorney General so advised

the various municipalities and threatened to sue them if they

did not mend their ways.

Thereafter, in 1999, the Rhode Island General Assembly

amended the statute. Under that amendment, "persons assessed"

now expressly includes mortgage companies and escrow agents.

The legislature also provided, however, that local tax

collectors who had read the statute otherwise in the past would

be considered to have followed the law. See 1999 R.I. Pub. Laws

resolution; provided, however, that the city or town
may provide that the option contained in the
resolution shall not apply to any tax levied in an
amount not in excess of one hundred dollars ($100) in
which case the tax shall be payable in a single
installment.

R.I. Gen. Laws § 44-5-7 (1995) (emphasis added) (amended 1999).

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ch. 493 (codified at R.I. Gen. Laws § 44-5-7 (1999)). The local

governments of Rhode Island appear now to comply with the law.

Although the practice of overescrowing had ended, the

plaintiff group of taxpayers still faced the problem of the loss

of the use of their money due to overescrowing from 1995 to

1998. The municipalities, and not the taxpayers, had received

the interest on the sums paid prematurely. The taxpayers felt

they were entitled to be made whole.

II.

Marie E. Tomaiolo and a group of other named plaintiffs

(for simplicity, we will refer from now on to Tomaiolo alone)

sued the tax collectors and almost all of Rhode Island's

municipalities (the "municipal defendants"), Transamerica

Corporation, and individuals employed by Transamerica Real

Estate Tax Service (TRETS). TRETS is the nation’s largest tax

servicing firm and a division of Transamerica. Tomaiolo alleged

that Transamerica and the individual employees (the "escrow

defendants") were state actors and that all the defendants

collectively:

1. deprived affected taxpayers of their property (the tax
payments, or at least the interest on them) without due
process of law (because the process due was that provided

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 by RESPA, Regulation X, and § 44-5-7) in violation of the
Fourteenth Amendment's Due Process Clause;

2. interfered with the taxpayers' rights to fair and equal
taxation under that Amendment's Equal Protection Clause;

3. violated the taxpayers' rights under Article 1, Section 2
of the Rhode Island Constitution, requiring equal
distribution of the burdens of government and guaranteeing
due process and equal protection of the laws;

4. intentionally interfered with the taxpayers' contractual
relationships with their banks.

Tomaiolo alleged other claims, but has since abandoned them.

The parties filed cross-motions for summary judgment.

In a thoughtful opinion, Tomaiolo v. Transamerica Corp., 131 F.

Supp. 2d 280 (D.R.I. 2001), the district court:

1. dismissed without prejudice all federal claims against the
municipal defendants as barred by both the Tax Injunction
Act and the principles of comity articulated in Fair
Assessment In Real Estate Ass'n, Inc. v. McNary, 454 U.S.
100 (1981);

2. dismissed all federal claims against the escrow defendants
because they were not state actors;

3. exercised supplemental jurisdiction over the state law
claims against the escrow defendants and granted summary
judgment for those defendants.

The district court never reached the question whether to certify

this case as a class action. This appeal followed.

III.

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 We review the district court's rulings de novo. See

McCarthy v. N.W. Airlines, 56 F.3d 313, 314-15 (1st Cir. 1995)

(reviewing de novo a grant of summary judgment); Murphy v.

United States, 45 F.3d 520, 522 (1st Cir. 1995) (same for a

dismissal for lack of subject matter jurisdiction); Garita Hotel

Ltd. P'ship v. Ponce Fed. Bank, F.S.B., 958 F.2d 15, 17 (1st

Cir. 1992) (same for a dismissal for failure to state a claim).

We address the questions presented by this appeal in

the following order. First, we hold that Tomaiolo's claims for

injunctive and declaratory relief are moot. Second, we hold

that she may not recover money damages against the municipal

defendants under the authority of Fair Assessment. Third, we

hold that the district court correctly granted summary judgment

on her claim under § 1983 against the escrow defendants because

those defendants were not acting under color of state law, as

that statute requires. Fourth, we hold that the district court

did not abuse its discretion in exercising supplemental

jurisdiction over some, but not all, of the state law claims,

and that it dealt correctly with those it addressed.

A. Mootness of Claims for Injunctive and Declaratory Relief

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 Tomaiolo's claims for injunctive and declaratory relief

are moot and indeed were moot before the district court

dismissed them. The conduct by the municipal defendants of

which Tomaiolo complains -- that is, their demand in alleged

violation of federal and state law that she and her class pay

their property taxes annually rather than quarterly -- has

ceased. There is, of course, the familiar principle that a

request for injunctive or declaratory relief does not become

moot simply because a defendant voluntarily ceases the allegedly

unlawful conduct. E.g., Friends of the Earth, Inc. v. Laidlaw

Envtl. Servs. (TOC), Inc., 528 U.S. 167, 189-93 (2000). The

actions of the municipal defendants, however, were not voluntary

but rather compelled by superior state officials: the Attorney

General in 1998, and the state legislature in 1999. Tomaiolo's

claims for injunctive and declaratory relief concern conduct

with no possibility of recurring, and are moot. See United

States v. W.T. Grant Co., 345 U.S. 629, 633 (1953). Counsel for

Tomaiolo conceded this point at oral argument. Tomaiolo's

claims for damages remain. We will address these claims

separately as to the municipal and the escrow defendants.

B. Dismissal of Federal Claims Against Municipal Defendants

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 The district court dismissed without prejudice the

claims against the municipal defendants on the basis that the

claims were barred by the Tax Injunction Act and by principles

of comity.

1. The Tax Injunction Act, comity, and § 1983

Our analysis of the district court's decision to

dismiss this claim is governed by the standard laid down by the

Supreme Court in the case of Fair Assessment in Real Estate

Ass'n, Inc. v. McNary, 454 U.S. 100 (1981). Under that

standard, Tomaiolo cannot obtain damages for the administration

of a state tax system under § 1983, even though that

administration may have violated federal law, so long as state

law provides her a plain, complete, and adequate remedy. Id. at

116. Before we apply Fair Assessment's standard, however, a

brief discussion of the case and subsequent developments may

clarify the relevant law.

The Tax Injunction Act of 1937 provides in its

entirety:

The district courts shall not enjoin, suspend or
restrain the assessment, levy or collection of any tax
under State law where a plain, speedy and efficient
remedy may be had in the courts of such State.

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28 U.S.C. § 1341 (1994). The Act limits the jurisdiction of the

federal courts, rather than merely restricting the remedies

available in a given civil action. Trailer Marine Trans. Corp.

v. Rivera Vazquez, 977 F.2d 1, 4-5 (1st Cir. 1992).

By its terms the Act applies to actions in which

plaintiffs seek injunctions against state officers. The Supreme

Court did not address the question whether the Act applies to

actions in which plaintiffs seek damages until 1981. That year,

in Fair Assessment, a group of property owners brought a suit

for damages under § 1983, claiming that their county's tax

assessors had denied them equal protection and deprived them of

their property without due process of law by failing to reassess

old properties in a timely fashion and by retaliating against

those who successfully appealed property assessments. 454 U.S.

at 105-06. In deciding the case, the Supreme Court stated that

it would not rely on the Tax Injunction Act. Id. at 107.

Instead, it held that the principle of comity between the

federal and state governments -- a principle embodied in, but

not limited to, the Act -- barred a federal court from

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considering the damages claim. Id. at 107, 116.3 The Court said

as well that the principle of comity would not apply to a case

in which a state provided no "plain, adequate, and complete"

remedy for violations of federal law in the tax collection

process. Id. at 116.4

The Court has since explained that what it did in Fair

Assessment was to construe § 1983, in light of the principle of

comity, to provide no cause of action for damages in state tax

cases. In Lehman v. Lycoming County Children's Services Agency,

458 U.S. 502 (1982), the Court noted that in Fair Assessment it

3 A forceful concurrence by four members of the Court
objected to the application of the principle of comity to an
action for damages. The concurring justices argued that federal
courts properly consider comity in traditionally equitable
actions, such as injunctive proceedings, but cannot properly do
so in traditionally legal ones, such as damages proceedings.
Fair Assessment, 454 U.S. at 117 (Brennan, J., concurring in the
judgment). Some of the concurring justices' concerns have since
been resolved. No reading of Fair Assessment as applying
principles of equitable discretion to a damages action survived
Quackenbush v. Allstate Insurance Co., 517 U.S. 706 (1996),
which is discussed in the text.
4 The Court in Fair Assessment neither recognized nor
wholly ruled out any difference between this requirement, drawn
from its equitable jurisprudence, and the parallel requirement
in the Tax Injunction Act (also drawn from equity) that to
qualify for protection from federal intervention a state must
provide "plain, speedy, and efficient" remedies. 454 U.S. at
116 n.8.

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had "conclude[d] that 42 U.S.C. § 1983 does not confer

jurisdiction on the federal courts to hear suits for tax refunds

when state law provides an adequate remedy." Id. at 512 n.16.

In National Private Truck Council, Inc. v. Oklahoma Tax

Commission, 515 U.S. 582 (1995), the Court stated that "in Fair

Assessment . . . the principle of noninterference with state

taxation led us to construe § 1983 narrowly." Id. at 589. Most

recently, in Quackenbush v. Allstate Insurance Co., 517 U.S. 706

(1996), the Court observed that in National Private Truck

Council it had "indicated that Fair Assessment was a case about

the scope of the § 1983 cause of action." Id. at 719.

Accordingly, it is clear that Fair Assessment applies to this

case, because Tomaiolo is bringing a § 1983 action for damages

suffered in the allegedly unlawful administration of a state tax

system. It is less clear -- as a matter of Supreme Court

precedent -- that the Tax Injunction Act itself applies.5

2. Application to this case

5 The law of this circuit may differ after Cumberland
Farms, Inc. v. Tax Assessor, 116 F.3d 943 (1st Cir. 1997), which
states, citing National Private Truck Council and without
further analysis, that the Tax Injunction Act applies directly
to suits under § 1983 for money damages. See id. at 945. The
result in this case does not depend on such subtleties.

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 We proceed to apply Fair Assessment to this case. If

Tomaiolo is alleging that Rhode Island officials have

administered the tax system of that state in violation of the

federal Constitution, she may not bring a case in federal court

so long as Rhode Island provides a remedy for such violations

that is plain, adequate, and complete.6

Tomaiolo's complaint, summarized above, demonstrates

that she is indeed alleging that the administration of Rhode

Island's tax system violated federal law. She responds,

however, that she is not challenging the validity of applicable

state law (§ 44-5-7), but is merely alleging that the municipal

6 Nothing about this case requires us to ask whether this
question may ever differ from the question whether the remedy is
plain, speedy, and efficient, a question unanswered by the
Supreme Court in Fair Assessment. As we discuss, Rhode Island's
remedies appear plain, speedy, efficient, complete, and
adequate. Moreover, because the two inquiries are identical for
the purposes of this case, we have no occasion to consider
whether the rule of Steel Co. v. Citizens for a Better
Environment, 523 U.S. 83, 93-102 (1998), which requires courts
to decide questions of subject matter jurisdiction before
deciding those that go to the merits, would require us to base
our holding on the Tax Injunction Act rather than on Fair
Assessment if the two inquiries diverged. Indeed, we note that
many courts applying the Tax Injunction Act and Fair Assessment
have in effect rolled the two inquiries into one. See, e.g.,
Kerns v. Dukes, 153 F.3d 96, 101 (3d Cir. 1998) (discussing the
effects of the statute and the case "taken together").

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defendants, conspiring with the escrow defendants,

misinterpreted that state law; that their misinterpretation put

them in conflict with RESPA; 7 and that it also led to

constitutional violations. A claim that a misinterpretation of

state law led to violations of federal rights is still a claim

that local officials broke federal law in interpreting and

applying state law. Tomaiolo's argument amounts to a

distinction without a difference. Moreover, if underlying her

federal arguments is a fundamental assertion that defendants

violated state law, all the more reason to defer to the state

system to determine what state law means.

Tomaiolo does not seriously contest that Rhode Island

provides a plain, adequate, and complete remedy through which

taxpayers may contest their taxes and have their federal claims

heard in state court. See, e.g., Oster v. Tellier, 544 A.2d

128, 132 (R.I. 1988) (holding certain provisions of the Rhode

Island tax code under R.I. Gen. Laws § 44 unconstitutional but

7
Because RESPA does not purport to govern municipal
officials, it is unclear in any event whether their actions
could possibly have violated rights protected by that statute.
To the extent that Tomaiolo bolsters her claim by relying on her
theory of a public-private conspiracy, we reject that theory
below.

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declining to award rebate for failure of proof of an

ascertainable amount of damages); see also Sterling Shoe Co. v.

Norberg, 411 F. Supp. 128 (D.R.I. 1976) ("[P]laintiff's

constitutional attack upon the adequacy of Rhode Island's

statutory scheme to contest tax assessments is wholly

insubstantial . . . ."). Tomaiolo offers nothing to contradict

that conclusion. In fact, she filed an identical action in the

Rhode Island Superior Court, which has effectively been stayed

pending the outcome of this action.

She does raise two additional arguments, which we

discuss briefly. First, she argues that the outcome we reach

conflicts with the historical role of the federal courts as a

forum for the enforcement of federal rights, citing cases such

as Wright v. Roanoke Redevelopment & Housing Authority, 479 U.S.

418 (1980), in which the Court held that § 1983 provided a cause

of action for residents of federally funded public housing

against the local housing authority that administered their

program. In Fair Assessment itself, the Court balanced the

conceded interests of § 1983 plaintiffs in a federal forum

against the interests of state and local defendants in the

uninterrupted operation of their tax systems. 454 U.S. at 116

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(noting that the Court reached its result "despite the ready

access to federal courts provided by" Monroe v. Pape, 365 U.S.

167 (1961), "and its progeny"). Tomaiolo's argument has

therefore already been taken into consideration in formulating

the rule we apply.

Second, she argues that this case differs from Fair

Assessment because in that case the alleged official misconduct

was continuing, so that a federal court's damages award would in

effect have halted it. In this case, she says, the alleged

misconduct has ceased, so that federal intervention would

operate only to cure the past wrong and not to affect the

present operation of the system. We reject this argument

because the procedure by which a state taxpayer may obtain a

refund of an allegedly illegally collected tax is no less a part

of the smooth functioning of the state's tax system than the

collection of the taxes in the first place. Perhaps, as

Tomaiolo maintains, the disruption we would cause by intervening

would be less on the facts of this case. Any such difference

would not be so great as to justify recognizing an exception to

Fair Assessment along the lines she proposes.

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 Thus, we agree that the federal claims against the

municipal defendants were properly dismissed under Fair

Assessment.

C. Dismissal of Federal Claims Against Escrow Defendants

Tomaiolo alleged that the escrow defendants acted under

color of state law and thus could be reached under 42 U.S.C.

§ 1983. Unless the escrow defendants were state actors, either

directly or by a close enough nexus to the state in defined

ways, there is neither a § 1983 claim nor a claim against them

for violation of constitutional rights. See Yeo v. Town of

Lexington, 131 F.3d 241, 248-49 & n.3 (1st Cir. 1997)

(discussing the requirement of state action for claims under the

Fourteenth Amendment and § 1983). We do not reach the question

whether Tomaiolo otherwise asserts a cognizable claim that her

constitutional rights and those of her class were violated.

We summarize briefly the relevant facts. On a grant

of summary judgment, these facts are read in the light most

favorable to Tomaiolo. McCarthy, 56 F.3d at 314. HUD issued

the amendments to Regulation X relevant to this action in

October 1994. TRETS then or shortly thereafter realized that

the amendments would change the way it handled escrow accounts

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across the country. Mark Williams, who managed TRETS operations

across several New England states, directed James Houghton, who

worked for TRETS in Rhode Island, to determine the position of

Rhode Island's municipal tax collectors as to whether their

municipalities required annual payment of property taxes, or

permitted quarterly payment. Williams and Houghton, together

with Beni Osuna, a TRETS employee in Dallas who led the TRETS

task force working on Regulation X, appear at that time to have

believed that Rhode Island state law left this choice to each

municipality.

Houghton visited many of the municipal defendants,

explaining the content and effects of the amendments to

Regulation X, and distributing to at least some of them a two-

page summary of the amendments prepared by TRETS. He also told

them that unless they issued letters requiring annual payment of

property taxes from escrow accounts, TRETS would make quarterly

payments. Shortly thereafter, over thirty of the municipal

defendants sent out a total of thirty-three letters of the sort

Houghton had mentioned. Some of the letters are substantially

the same; Houghton appears to have carried copies from one

municipality to another.

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 Tomaiolo argues that the escrow defendants themselves

misinterpreted Rhode Island law, communicated that

misinterpretation to the municipal defendants, and then induced

the sending of some thirty-three virtually identical letters

from the municipal defendants back to the escrow defendants

adopting that misinterpretation, thus leading to the

constitutional violations. This is a form of "entwinement"

state action theory, under which nominally private action

becomes so mixed and intermingled with state action that it can

no longer be called truly private.

The latest Supreme Court cases to address whether

apparently private actors may be considered state actors on an

entwinement theory are Brentwood Academy v. Tennessee Secondary

School Athletic Ass'n, 531 U.S. 288 (2001), and National

Collegiate Athletic Ass'n v. Tarkanian, 488 U.S. 179 (1988).

Brentwood held that the activities of an athletic association

within a single state could fairly be treated as those of the

state itself, because "[t]he nominally private character of the

Association [was] overborne by the pervasive entwinement of

public institutions and public officials in its composition and

workings, and there is no substantial reason to claim unfairness

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in applying constitutional standards to it." 531 U.S. at 298.

In contrast, in Tarkanian, the activities of a multistate

athletic association were those of a collective membership, and

the association was not the surrogate of any state. 488 U.S. at

193-94.

Here, to be sure, enforcement of state tax laws and

collection of state taxes is emphatically a state function. But

the classic indicia of entwinement, much less pervasive

entwinement, are missing. There is no financial support from

the state to the escrow defendants, much less any support that

interplays with the decisions taken; nor is there any allocation

of traditional state functions to the private entities. Also

lacking is any evidence that the government is the real actor

behind a private facade, joining in a charade designed to evade

constitutional prohibitions.8

8 Thus, for example, in Adickes v. S. H. Kress & Co., 398
U.S. 144 (1970), on which Tomaiolo relies, the Court held in
reversing summary judgment for the defendant, a private
restaurant, that the plaintiff might be able to establish facts
at trial showing that that the restaurant had in effect become
a state actor. In that case, Adickes was refused service in the
restaurant, allegedly because she was a white woman in the
company of black children; she offered evidence that would allow
a jury to find that a police officer (who subsequently arrested
Adickes for vagrancy) had reached an understanding with the

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 At most there is an argument that the escrow defendants

somehow caused or induced the municipal actors to take the steps

they did. An "inducement" theory is a particularly weak and

problematic theory of state action, often rejected. See Roche

v. John Hancock Mut. Life. Ins. Co., 81 F.3d 249, 253-54 (1st

Cir. 1996) (affirming a grant of summary judgment for a

corporate employer whose agents reported to the police their

suspicions that a laid-off employee had made harassing phone

calls); Alexis v. McDonald's Rests. of Mass., Inc., 67 F.3d 341,

351-52 (1st Cir. 1995) (affirming a grant of summary judgment

for a restaurant manager who called the police to remove a

patron); see also Tarkanian, 488 U.S. at 192 (observing that

such a claim "mirrors the traditional state-action case"). It

has sometimes been accepted on particularly compelling facts.

See, e.g., Wagenmann v. Adams, 829 F.2d 196, 210-11 (1st Cir.

1987) (affirming a jury verdict against a private citizen on a

restaurant staff that she was not to be served. Id. at 157-58.
Adickes illustrates that courts will at times hold liable a
private actor who agrees to do the unconstitutional bidding of
a public officer. It does not govern the far different case
presented here, in which at most a public officer -- on whom
rested the ultimate responsibility to uphold the law -- took the
allegedly incorrect advice of a private actor.

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record that enabled the jury to find that because of the

citizen's influence "the . . . police felt constrained to jail

the plaintiff notwithstanding the absence of any legal basis to

do so").

The inducement theory of state action is problematic

for at least two reasons. First, it assumes that state actors

do not exercise their independent judgment in the face of

requests from private citizens, but merely act as puppets.

Second and more importantly, the theory may impose burdens on

the rights of private citizens to communicate with government

officials on topics of concern. Cf. Yeo, 131 F.3d at 255

("Where, as here, there are First Amendment interests on both

sides of the case, the analysis of whether there is state action

must proceed with care and caution.").

Here, there is insufficient evidence that the town

officials abandoned their best judgment as to the meaning of

state law. Tomaiolo produced evidence that many of the letters

sent by the municipal defendants contained similar or identical

language, and that many of the letters were sent soon after

Houghton's visits. She also argues that the municipal

defendants shared an incentive to adopt the reading of state law

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that they did. From this, a jury could find that some of the

municipal defendants saw letters written by the others, that

Houghton had carried the letters from one defendant to another,

and even that Houghton had suggested that the defendants send

the letters out. Such findings would not support the degree of

substitution of private judgment for public judgment required to

convert the escrow defendants' acts into state action.

The second problem with the inducement theory of state

action is very real here. The escrow defendants had every

reason to contact the town officials to obtain clarification of

state law. Indeed, Regulation X by its terms required more

favorable treatment only if state law permitted it. It was thus

in order to comply with a federal law, Regulation X, that they

initiated the contact. A finding that these private actors were

state actors, even if they can arguably be said to have induced

the particular statutory interpretations by the state actors,

might well chill the exercise of their own rights to communicate

with government. Several circuits have held, and this one has

at least hinted, that in view of the First Amendment the courts

should avoid an interpretation of § 1983 so broad as to

encompass petitions for government action. See Tarpley v.

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Keistler, 188 F.3d 788, 793-95 (7th Cir. 1999) (collecting

cases);9 cf. Munoz Vargas v. Romero Barcelo, 532 F.2d 765, 766

(1st Cir. 1976) ("[T]here is no remedy . . . against private

persons who urge the enactment of laws, regardless of their

motives.").

In sum, the inducement theory, acceptable only on

extreme facts, requires far more than Tomaiolo has shown. As a

matter of law, her claim that the escrow defendants engaged in

state action fails.

D. Pendent State-Law Claims

1. Supplemental jurisdiction

Once the federal claims were dismissed, it was within

the discretion of the district court to exercise supplemental

jurisdiction under 28 U.S.C. § 1367 over Tomaiolo's state law

claims. Roche, 81 F.3d at 256-57. The court did not abuse its

9 These courts have relied on the Supreme Court's cases
of Eastern Railroad Presidents Conference v. Noerr Motor
Freight, Inc., 365 U.S. 127 (1961), and United Mine Workers of
America v. Pennington, 381 U.S. 657 (1965), which established
what is now commonly referred to as the Noerr-Pennington
doctrine. That doctrine originated in the law of antitrust, but
in cases such as Tarpley and its predecessors the courts have
extended it to other federal statutes that provide causes of
action so broad as potentially to chill the constitutionally
protected right to petition the government.

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discretion in exercising its jurisdiction over the claims

against the escrow defendants. The litigation was far advanced:

the court had before it cross-motions for summary judgment,

discovery had closed, Tomaiolo had filed her sixth amended

complaint, and all claims arose from the same core of facts.

That exercise of jurisdiction quite furthered judicial economy.

Moreover, we perceive no unfairness: Tomaiolo chose to be in

federal court, and once there received ample opportunity to

litigate all of her claims, federal and state.

2. State constitutional claims

Tomaiolo asserted that both the municipal defendants

and the escrow defendants had violated Article 1, Section 2 of

the Constitution of Rhode Island, which provides that:

The burdens of the state ought to be fairly
distributed among its citizens. No person shall be
deprived of life, liberty or property without due
process of law, nor shall any person be denied equal
protection of the law.

The first sentence of this section, regarding the burdens of the

state, is either judicially unenforceable or else imposes the

same constraint as the later reference to equal protection.

Town of Lincoln v. City of Pawtucket, 745 A.2d 139, 146 (R.I.

2000). The second sentence incorporates language similar to

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that of the Due Process and Equal Protection Clauses of the

Fifth and Fourteenth Amendments to the federal Constitution. In

interpreting that sentence, the Rhode Island Supreme Court has

noted the similarity and has engaged in a state action inquiry

similar to that in Brentwood and Tarkanian. See, e.g., Kleczek

v. R.I. Interscholastic League, Inc., 612 A.2d 734, 735-36 (R.I.

1992). The district court therefore correctly concluded that

without state action by the escrow defendants, Tomaiolo's state

constitutional claim against them could not succeed.

Although the district court did not explicitly discuss

the state constitutional claim against the municipal

defendants, the logic behind dismissing the federal claims out

of deference to the state system would suggest similar deference

as to the state constitutional claim. We understand the court

to have declined to exercise its jurisdiction over this claim,

and approve.

3. State tort claims

We agree with the district court's concise analysis

dismissing these claims against the escrow defendants and see no

need to add to the discussion. 1st Cir. R. 27.1.

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 IV.

We modify the judgment of the district court to dismiss

with prejudice all claims for injunctive and declaratory relief

as moot, and in all other respects we affirm the judgment of the

district court. No costs are awarded.

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