Centro Medico Del Turabo, Inc. v. Feliciano De Melecio

United States Court of Appeals
For the First Circuit

No. 04-1967

CENTRO MEDICO DEL TURABO, INC., ET AL.,

Plaintiffs, Appellants,

v.

CARMEN FELICIANO DE MELECIO,

Defendant, Appellee.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF PUERTO RICO

[Hon. Salvador E. Casellas, U.S. District Judge]

Before

Selya, Circuit Judge,
Coffin, Senior Circuit Judge,
and Lipez, Circuit Judge.

Fernando E. Agrait, with whom Orlando H. Martínez-Echeverría
was on brief, for appellants.
Doraliz E. Ortiz-de-León, Assistant Solicitor General, with
whom Roberto J. Sánchez Ramos, Solicitor General, Kenneth Pamias
Velázquez, Deputy Solicitor General, and Camelia Fernández-Romeu,
Office of the Solicitor General, were on brief, for appellee.

April 19, 2005
 SELYA, Circuit Judge. In this appeal, the plaintiffs

challenge the district court's dismissal of their complaint,

brought under 42 U.S.C. § 1983, for failure to state a claim upon

which relief might be granted. After careful consideration of the

briefs and the record, we conclude that the most recent incident

described in the complaint was not actionable; that the earlier

incidents fell outside the limitations period; and, therefore, that

the district court properly dismissed the complaint.

I.

Background

Beginning in 1993, the Commonwealth of Puerto Rico

embarked on a process of privatizing its extensive network of

public health facilities. That effort provides the backdrop for

this litigation.

On November 22, 1999, plaintiffs-appellants Centro Medico

del Turabo, Inc., Turabo Medical Center Partnership, Hospital

Interamericano de Medicina Avanzada de Humacao, and Joaquín

Rodríguez García (Rodríguez) filed a civil action against Carmen

Feliciano de Melecio (the Commonwealth's Secretary of Health). The

complaint charged that, between 1993 and 1999, the Secretary had

refused to grant certificates of necessity and convenience required

to develop certain medical facilities at two of the plaintiffs'

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hospitals,1 denied them permission to transfer a license from one

hospital to another, and awarded contracts for the purchase, lease,

and/or administration of various public health facilities to

entities not affiliated with the plaintiffs. The complaint further

alleged that these acts and omissions were discriminatory,

transgressed due process, denied the plaintiffs the equal

protection of the laws, and were taken in retaliation for the

plaintiffs' exercise of their First Amendment rights (i.e., their

persistent challenges to various of the Secretary's actions in the

local courts). The suit sought both damages and injunctive relief

to redress these alleged constitutional harms.

The Secretary filed a motion to dismiss, arguing, inter

alia, that the statute of limitations had run. The plaintiffs

rejoined that the described incidents comprised an interrelated

series of constitutional violations, one of which occurred within

the limitations period, and, thus, that the "continuing violation"

doctrine salvaged all of their claims. The district court

disagreed and granted the motion to dismiss. See Centro Medico del

Turabo v. Feliciano de Melecio, 321 F. Supp. 2d 285 (D.P.R. 2004).

In pertinent part, the district court concluded that the

complaint, on its face, demonstrated that the plaintiffs were aware

as early as 1996 of the need to assert their rights in response to

1
The plaintiffs are related parties, controlled in the final
analysis by Rodríguez. The precise relationships among them are
not relevant to the issues on appeal.

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the Secretary's actions, but nevertheless failed seasonably to

invoke section 1983. See id. at 292. The court then focused on

the one timeous incident described in the complaint — the

Secretary's contractual assignment of the Caguas Regional Hospital

(CRH) to the control of a medical school, Escuela de Ciencias

Medícas San Juan Bautista (San Juan Bautista), in July of 1999 —

and concluded that the circumstances there were neither

sufficiently similar to those underlying the time-barred claims to

justify treating it as a continuation of the earlier episodes nor

independently sufficient to ground a cognizable constitutional

claim. See id. at 292-94. This appeal ensued.

II.

Discussion

In this venue, the plaintiffs argue that the 1999 grant

to San Juan Bautista of the right to administer CRH was one in a

series of discriminatory actions taken against them by the

Secretary; that the 1999 incident falls within the limitations

period; and that the events underlying the time-barred claims are

so substantially related to that incident that the entire series of

claims should be deemed timely filed under the continuing violation

doctrine. We limn the standard of review, chart the contours of

the pertinent legal landscape, and then turn to the plaintiffs'

argument.

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 A.

Standard of Review

The court below dismissed the plaintiffs' action for

failure to state a claim under Fed. R. Civ. P. 12(b)(6). We review

that determination de novo, adhering to the same criteria that

bound the lower court. In re Colonial Mortg. Bankers Corp., 324

F.3d 12, 15 (1st Cir. 2003). The tools of this trade include the

complaint, documents annexed to it or fairly incorporated into it,

and matters susceptible to judicial notice. Rodi v. S. New Eng.

Sch. of Law, 389 F.3d 5, 12 (1st Cir. 2004).

In a civil rights case, there is no heightened pleading

standard. Educadores Puertorriqueños en Acción v. Hernández, 367

F.3d 61, 66-67 (1st Cir. 2004). Therefore, a district court

charged with the adjudication of a motion to dismiss under Rule

12(b)(6) must apply the notice pleading requirements of Fed. R.

Civ. P. 8(a)(2). Rivera v. Rhode Island, 402 F.3d 27, 33 (1st Cir.

2005); Educadores, 367 F.3d at 66. A complaint satisfies that

standard if it contains "a short and plain statement of the claim

showing that the pleader is entitled to relief," Fed. R. Civ. P.

8(a)(2), and "give[s] the defendant fair notice of what the

plaintiff's claim is and the grounds upon which it rests," Conley

v. Gibson, 355 U.S. 41, 47 (1957).

In measuring a complaint against this benchmark, a

reviewing court must "assume the truth of all well-pleaded facts

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and indulge all reasonable inferences that fit the plaintiff's

stated theory of liability." Colonial Mortg. Bankers, 324 F.3d at

15. Still, such a court is not bound to credit "bald assertions,

unsupportable conclusions, periphrastic circumlocutions, and the

like." Aulson v. Blanchard, 83 F.3d 1, 3 (1st Cir. 1996).

Once the court has performed this tamisage, dismissal for

failure to state a claim will be appropriate if the pleadings fail

to set forth "factual allegations, either direct or inferential,

respecting each material element necessary to sustain recovery

under some actionable legal theory." Berner v. Delahanty, 129 F.3d

20, 25 (1st Cir. 1997) (quoting Gooley v. Mobil Oil Corp., 851 F.2d

513, 515 (1st Cir. 1988) (internal quotation marks omitted)). We

will affirm a dismissal only if it is transparently clear that the

complaint, in light of the facts alleged, engenders no viable

theory of liability. Educadores, 367 F.3d at 66; Blackstone Realty

LLC v. FDIC, 244 F.3d 193, 197 (1st Cir. 2001).

Under this rubric, it is sometimes permissible to grant

a motion to dismiss based on an affirmative defense, such as the

statute of limitations. That happens "when the pleader's

allegations leave no doubt that an asserted claim is time-barred."

LaChapelle v. Berkshire Life Ins. Co., 142 F.3d 507, 509 (1st Cir.

1998). This is the test that we apply here.

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 B.

The Limitations Period

Section 1983 creates a private right of action for

redressing abridgments or deprivations of federally assured

rights.2 Cox v. Hainey, 391 F.3d 25, 29 (1st Cir. 2004); McIntosh

v. Antonino, 71 F.3d 29, 33 (1st Cir. 1995). Because it does not

contain a built-in limitations period, a federal court adjudicating

a section 1983 action must borrow the forum state's general statute

of limitations for personal injury actions. Owens v. Okure, 488

U.S. 235, 240-41, 249-50 (1989); Nieves v. McSweeney, 241 F.3d 46,

51 (1st Cir. 2001). In Puerto Rico, the limitations period for

injuries to the person is one year. See 31 P.R. Laws Ann. §

5298(2). Accordingly, that term applies here. See Rodríguez-

Garcia v. Municipality of Caguas, 354 F.3d 91, 96 (1st Cir. 2004);

Rivera-Muriente v. Agosto-Alicea, 959 F.2d 349, 353 (1st Cir.

1992).

2
That statute provides in pertinent part:

Every person who, under color of any statute, ordinance,
regulation, custom, or usage, of any State or Territory
or the District of Columbia, subjects, or causes to be
subjected, any citizen of the United States or other
person within the jurisdiction thereof to the deprivation
of any rights, privileges, or immunities secured by the
Constitution and laws, shall be liable to the party
injured in an action at law, suit in equity, or other
proper proceeding for redress.

42 U.S.C. § 1983.

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 Puerto Rico's one-year limitations period begins to run

one day after the date of accrual. See Carreras-Rosa v. Alves-

Cruz, 127 F.3d 172, 175 (1st Cir. 1997) (per curiam). The accrual

date, however, is determined in accordance with federal law.

Rivera-Muriente, 959 F.2d at 353. In a section 1983 case, a claim

ordinarily accrues "when the plaintiff knows, or has reason to

know, of the injury on which the action is based." Id.; see also

Nieves-Márquez v. Puerto Rico, 353 F.3d 108, 119-20 (1st Cir. 2003)

(noting that a claim accrues "when facts supportive of a civil

rights action are or should be apparent to a reasonably prudent

person similarly situated" (citation and internal quotation marks

omitted)).

Here, the plaintiffs do not dispute that they knew, or

had reason to know, of their injuries immediately following the

occurrence of each of the various incidents. It is likewise

undisputed that the only stand-alone claim of injury that falls

chronologically within the limitations period is the claim relating

to the Secretary's July 1999 transfer of administrative

responsibility over CRH to San Juan Bautista. The plaintiffs

nevertheless seek to salvage their earlier claims by bringing them

under the umbrella of the continuing violation doctrine. To that

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end, they allege that the CRH contretemps was part of a long-

running serial violation.3

Under the serial violation branch of the continuing

violation doctrine, a plaintiff may link a number of discriminatory

acts emanating from the same discriminatory animus, even though

each act constitutes a separate wrong. See Provencher v. CVS

Pharmacy, 145 F.3d 5, 14 (1st Cir. 1998); Jensen v. Frank, 912 F.2d

517, 522 (1st Cir. 1990). If the plaintiff can forge that link and

can also show that at least one act in the series occurred within

the limitations period, the suit may be considered timely as to all

the acts. See Lawton v. State Mut. Life Assur. Co., 101 F.3d 218,

221-22 (1st Cir. 1996); Kassaye v. Bryant Coll., 999 F.2d 603, 606

(1st Cir. 1993).

In order for the serial violation theory to apply, the

act that falls within the limitations period must itself constitute

an actionable violation. Lawton, 101 F.3d 222 ("Common sense

teaches that a plaintiff cannot resuscitate time-barred acts, said

to be discriminatory, by the simple expedient of linking them to a

non-identical, non-discriminatory, non-time barred act."); Muniz-

Cabrero v. Ruiz, 23 F.3d 607, 610-11 (1st Cir. 1994) (refusing to

3
The continuing violation doctrine encompasses both serial
violations and systemic violations. Jensen v. Frank, 912 F.2d 517,
522 (1st Cir. 1990). The plaintiffs have not alleged a systemic
violation. See Centro Medico del Turabo, 321 F. Supp. 2d at 292;
see also Appellants' Br. at 10 (accepting the district court's
determination that no systemic violation was alleged).

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apply the serial violation theory when the plaintiff had failed to

show that the timely acts were "separate and actionable § 1983

violations"); Mack v. Great Atl. & Pac. Tea Co., 871 F.2d 179, 183

(1st Cir. 1989) (stating that the plaintiff "retain[s] the burden

of demonstrating that some discriminatory act transpired within the

appropriate time frame"). It follows inexorably that if the

plaintiffs have failed to state an independently actionable claim

based on the CRH incident, they cannot rely on that incident to

anchor the rest of their claims (each of which arose out of events

that occurred well prior to November 21, 1998 — the earliest day

within the limitations period). Consequently, we examine that

claim before proceeding further.

C.

The July 1999 Incident

In their complaint and their brief, the plaintiffs have

proposed, without meaningful elaboration, that the assignment to

San Juan Bautista of the right to administer CRH's affairs

contravened their due process, equal protection, and First

Amendment rights. We address each of these suggested bases for

liability.

1. Procedural Due Process. The plaintiffs have made a

general suggestion that the Secretary's failure to award them the

right to purchase, lease, or manage CRH violated due process. To

the extent that they hope to maintain a procedural due process

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claim, they must first point to a protected liberty or property

interest. Bd. of Regents v. Roth, 408 U.S. 564, 569 (1972) ("The

requirements of procedural due process apply only to the

deprivation of interests encompassed by the Fourteenth Amendment's

protection of liberty and property."). There is no liberty

interest implicated here,4 so the plaintiffs' claim stands or

falls, in the first instance, on the existence of a

constitutionally protected property interest.

In order to establish a constitutionally protected

property interest, the plaintiffs must identify a "legitimate claim

of entitlement" to the property in question — a claim of

entitlement created and defined by "existing rules or

understandings that stem from an independent source such as state

law." Id. at 577. For this purpose, "an abstract need or desire"

or a "unilateral expectation" are not sufficient to cement a

constitutionally protected interest. Id.

The plaintiffs allege that, on two occasions, they wrote

to the Secretary to express an interest in purchasing, leasing, or

managing CRH. That is not enough: they have wholly failed to

identify any legally cognizable property interest in acquiring a

4
To invoke a liberty interest, the plaintiffs would have to
identify "a right or status previously recognized by state law
[that] was distinctly altered or extinguished" by state action.
Paul v. Davis, 424 U.S. 693, 711 (1976); see also Johnson v.
Rodriguez, 943 F.2d 104, 109 (1st Cir. 1991). They have made no
effort to convince us that any such right or status is implicated
here, and we can think of none.

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right to purchase, lease, manage, or otherwise participate in the

privatization of CRH. Puerto Rico law governing the Department of

Health's authority to grant contracts for the privatization of

publicly-owned health care facilities dispels any doubt. The

statutory scheme not only explicitly allows the Secretary to award

such contracts to medical schools without following the usual

bidding protocol but also directs that she prefer such

institutions. See 24 P.R. Laws Ann. §§ 3322, 3306. These statutes

make it pellucid that the plaintiffs had no legally cognizable

right to vie for the CRH contract on an equal footing with San Juan

Bautista, let alone an entitlement to have that contract awarded to

them rather than to a medical school. The short of it is that the

plaintiffs had nothing more than a unilateral desire to secure a

stake in CRH's privatization. The frustration of such a subjective

desire is a far cry from the deprivation of a constitutionally

protected property interest. For this reason, the plaintiffs'

procedural due process claim fails.

2. Substantive Due Process. Next, the plaintiffs

contend that the Secretary's awarding of a contract to San Juan

Bautista was "[a]rbitrary, capricious, unfounded, and

discriminatory," thus violating their right to substantive due

process. This contention rings hollow.

The Fourteenth Amendment protects against deprivation of

life, liberty, or property without due process of law. See U.S.

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Const. amend XIV. The substantive component of this guarantee

guards against "certain government actions regardless of the

fairness of the procedures used to implement them." Daniels v.

Williams, 474 U.S. 327, 331 (1986). In the substantive due process

context (as in the procedural due process context), a plaintiff, as

a condition precedent to stating a valid claim, must exhibit a

constitutionally protected interest in life, liberty, or property.

See Washington v. Glucksberg, 521 U.S. 702, 722 (1997); Rivera, 402

F.3d at 33-34; Macone v. Town of Wakefield, 277 F.3d 1, 9 (1st Cir.

2002). As explained above, see supra Part II(C)(1), the plaintiffs

have failed to identify such an interest. Consequently, their

substantive due process claim founders.

3. Equal Protection. The plaintiffs asseverate that the

Secretary's grant of the CRH contract to San Juan Bautista denied

them a fair shake in the potentially lucrative process of

privatization of public health facilities, in violation of the

Equal Protection Clause. This asseveration is frivolous. The

plaintiffs failed, even when pressed at oral argument, to position

their claim within the familiar equal protection framework: they

have not claimed membership in a protected class or demonstrated

that other entities, similarly situated, were treated differently

concerning the award of hospital contracts. Their inability to

identify these doctrinal rudiments is fatal to their equal

protection challenge. See Barrington Cove Ltd. P'ship v. R.I.

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Hous. & Mortg. Fin. Corp., 246 F.3d 1, 7-10 (1st Cir. 2001);

Hennessy v. City of Melrose, 194 F.3d 237, 244 (1st Cir. 1999);

Gilbert v. City of Cambridge, 932 F.2d 51, 66 (1st Cir. 1991).

4. First Amendment. The plaintiffs' last-gasp claim is

that the award of the CRH contract to an unrelated entity was part

of a "punitive campaign" to retaliate against them for availing

themselves of commonwealth court remedies following the Secretary's

denial of their applications for certain hospital permits. The

Supreme Court has made it plain that "even though a person has no

'right' to a valuable governmental benefit and even though the

government may deny him the benefit for any number of reasons,

there are some reasons upon which the government may not rely."

Perry v. Sindermann, 408 U.S. 593, 597 (1972). The exercise of

First Amendment rights is among the constitutionally proscribed

reasons for the denial of a government benefit. Id. Thus, we have

recognized, as a general matter, that "[c]laims of retaliation for

the exercise of First Amendment rights are cognizable under §

1983." Powell v. Alexander, 391 F.3d 1, 16 (1st Cir. 2004).

It is an open question, however, whether First Amendment

retaliation claims presented by disappointed bidders or applicants

for new government contracts are cognizable. In Board of County

Commissioners v. Umbehr, 518 U.S. 668, 673 (1996), the Court held

that First Amendment protections extend to independent contractors

alleging termination or prevention of automatic renewal of at-will

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government contracts in retaliation for the exercise of the freedom

of speech. On that basis, the Court held that a person so situated

could state a valid cause of action under section 1983. See id. at

686. In so holding, the Justices "emphasize[d] the limited nature

of [their] decision," which concerned only "the termination of a

pre-existing commercial relationship with the government," and,

accordingly, declined to address "the possibility of suits by

bidders or applicants for new government contracts who cannot rely

on such a relationship." Id. at 685.

Following Umbehr and a closely related decision

recognizing similar protections for independent contractors

alleging politically motivated discrimination, see O'Hare Truck

Serv., Inc. v. City of Northlake, 518 U.S. 712, 714-15 (1996), we

have acknowledged this uncertainty, observing that "[t]he next area

of contest appears to revolve around those who wish for the first

time to bid for government contracts." Prisma Zona Exploratoria v.

Calderon, 310 F.3d 1, 7 (1st Cir. 2002). In Prisma Zona, however,

we found it unnecessary to resolve that question, see id. — and we

have the same luxury today.

Even assuming, for argument's sake, that an entity that

has no preexisting contractual relationship with the Commonwealth

can state a claim under section 1983 for an allegedly retaliatory

denial of a bid, we nevertheless find that the plaintiffs have

failed to state a valid retaliation claim because they have not

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identified any action taken against them by the Secretary in

connection with the privatization of CRH, whether in the form of an

actual denial of a bid or an improper refusal to consider an

application. To the contrary, the Secretary, in accordance with

her authority under 24 P.R. Laws Ann. §§ 3306, 3322, never issued

an invitation for bids. Consequently, the plaintiffs' status does

not rise to that of disappointed bidders, and the grant of the CRH

contract to San Juan Bautista cannot be characterized as an action

taken against them so as to satisfy the threshold requirement of

alleging a retaliatory decision. We explain briefly.

If the protections recognized in Umbehr were to extend to

unsolicited bids for new government contracts — a matter on which

we take no view — establishing a First Amendment retaliation claim

would necessitate a showing "that [the plaintiff's] conduct was

constitutionally protected, and that this conduct was a

'substantial factor' [or] . . . a 'motivating factor'" driving the

allegedly retaliatory decision. Mt. Healthy City Sch. Dist. Bd. of

Educ. v. Doyle, 429 U.S. 274, 287 (1977). Even so, the defendant

could then avoid a finding of liability by way of the so-called Mt.

Healthy defense, which requires a showing that "it would have

reached the same decision . . . even in the absence of the

protected conduct." Id.; see also Umbehr, 518 U.S. at 685.

In this case, the plaintiffs have alleged that, on three

occasions occurring in 1996 and 1997, they successfully appealed

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denials of applications for hospital licenses. As a general

matter, this type of conduct — seeking to avail oneself of judicial

remedies — is constitutionally protected. See Powell, 391 F.3d at

17. Thus, we assume that the plaintiffs have stated the first

material element of a retaliation claim.

That is about as far as the allegations of the complaint

take the plaintiffs. Although they have shown constitutionally

protected conduct, they have failed to identify any retaliatory

decision made by the Secretary, within the limitations period, in

response to that conduct.

The complaint provides no support for the contention that

the Secretary's grant of a contract to administer CRH to San Juan

Bautista was connected in any way to the plaintiffs, let alone to

their earlier court activities. The Secretary, pursuant to a

statutory preference that the plaintiffs do not challenge, elected

to award the contract to an accredited medical school without

conducting an open application process. At no point did she deny

any application or bid submitted by the plaintiffs. By like token,

the grant to San Juan Bautista did not involve any omission on the

part of the Secretary: she was not required to extend a request

for bids; the plaintiffs had no constitutionally protected interest

in participating in such a process; and, therefore, the failure to

respond to the plaintiffs' unsolicited notices of interest cannot

plausibly be characterized as the neglect of an obligation owed to

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the plaintiffs. In the absence of some action directed against the

plaintiffs or some omission that diminishes a constitutionally

protected interest or entitlement, the Secretary's conduct cannot

be said to have been taken against the plaintiffs. See LaRou v.

Ridlon, 98 F.3d 659, 662-63 (1st Cir. 1996) (finding that the

decision to post a job listing without first making offer to

plaintiff was not retaliatory because defendant had no obligation

to give preference to the plaintiff).

Even if the Secretary's action could, by some

thaumaturgical feat, be characterized as one directed against the

plaintiffs (rather than one that merely has an incidental effect on

an unprotected interest), the plaintiffs would have to show that

the adverse action was substantially attributable to the exercise

of their rights of appeal and not to some other (unrelated) reason.

See Mihos v. Swift, 358 F.3d 91, 108 (1st Cir. 2004). Other than

making a vague mention of the "timing of the acts" and a conclusory

reference to the defendant's "hostility," the plaintiffs have not

made any allegation that their earlier recourse to the Puerto Rico

courts was a substantial or motivating factor in the Secretary's

decision to award the CRH contract to San Juan Bautista.5

5
In point of fact, the lapse of time between the exercise of
the plaintiffs' rights of appeal and the Secretary's allegedly
retaliatory action (roughly two years) undercuts rather than
supports the plaintiffs' effort to demonstrate a causal connection.
Although close temporal proximity between two events may give rise
to an inference of causal connection, see, e.g., Lewis v. City of
Boston, 321 F.3d 207, 219 (1st Cir. 2003), intervals similar to the

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 Moreover, the record establishes that, even without the

protected activity, the same result would have obtained. After

all, the Secretary, on this occasion, took no action against the

plaintiffs. She was mandated by law to prefer medical schools in

the awarding of hospital contracts — and that is precisely what she

did.

To recapitulate, we conclude that the plaintiffs have

failed to state a constitutionally cognizable claim related to the

July 1999 contract award. Because that incident cannot support an

actionable claim under section 1983, it cannot anchor the remainder

of the plaintiffs' (time-barred) claims. See Muniz-Cabrero, 23

F.3d at 610-11. Thus, we do not reach the question of whether the

other criteria necessary for a serial violation claim are satisfied

here.

III.

Conclusion

We need go no further. Concluding, as we do, that the

complaint fails to state a cause of action upon which section 1983

one involved here are simply too long to support such an inference,
see, e.g., id. (noting that the passage of eighteen months between
the protected conduct and the allegedly retaliatory action undercut
the temporal proximity argument); Dressler v. Daniel, 315 F.3d 75,
79-80 (1st Cir. 2003) (finding causal connection tenuous because of
passage of two years); Lewis v. Gillette Co., 22 F.3d 22, 25 (1st
Cir. 1994) (finding that lapse of two years undermined inference);
see also Mesnick v. Gen. Elec. Co., 950 F.2d 816, 828 (1st Cir.
1991) (holding that nine-month period between relevant events
weakened any inference of causation).

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relief can be granted, we affirm the district court's order of

dismissal.

Affirmed.

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