File Name: 08a0626n.06
Filed: October 16, 2008
NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
No. 07-6405
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
RAMONA HILLMAN,
Plaintiff-Appellant,
v. ON APPEAL FROM THE
UNITED STATES DISTRICT
SHELBY COUNTY GOVERNMENT, COURT FOR THE WESTERN
DISTRICT OF TENNESSEE
Defendant-Appellee.
/
Before: MARTIN, DAUGHTREY, and KETHLEDGE, Circuit Judges.
BOYCE F. MARTIN, JR., Circuit Judge. Plaintiff Ramona Hillman appeals the district
court’s sua sponte dismissal of her claims against her former employer, Shelby County Government.
Hillman alleges retaliation in violation of Title VII of the Civil Rights Act of 1964. 42 U.S.C. §
2000e. The district court dismissed her claim after determining that they were barred by issue
preclusion because a state agency had previously ruled on it in a quasi-judicial capacity. We disagree.
In University of Tennessee v. Elliott, 478 U.S. 788 (1986), the Supreme Court held that unreviewed
(in the sense that no state court has reviewed them) administrative findings do not preclude a
subsequent Title VII action. Id. at 795-96. Because the agency determination here was not reviewed
by any state court, we reverse and remand for further proceedings.
I.
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Hillman v. Shelby County
Page 2
Ramona Hillman was a corrections officer at the Shelby County Corrections Center, which
is owned and operated by Shelby County, Tennessee. Shelby County fired her in June 2004
following an investigation into allegations of misconduct. It gave her a hearing, and the hearing
officer recommended termination. Her discharge was upheld internally, and Hillman appealed to the
Shelby County Civil Service Merit Review Board. The board’s three person panel also upheld her
firing.
Shortly before the Board’s hearing, Hillman filed a charge of discrimination with the EEOC,
alleging retaliation. In October 2004, the EEOC issued its Notice of Suit Rights and Hillman filed
her suit the following January. The district court set a trial date, but during the pretrial conference
in September 2007, it observed that, although Shelby County had raised the issue of failure to
exhaust administrative remedies in its answer, it had never moved for dismissal on that ground. The
court removed the trial from the calender and told counsel to submit briefs on the exhaustion
question. Shelby County, however, did not brief the exhaustion question and instead set forth a new
ground for dismissal: issue preclusion. The district court then instructed Hillman to brief that issue
and Shelby County to brief the exhaustion question. The district court then dismissed Hillman’s
claim on issue preclusion grounds, ruling that it was precluded because the issues had already been
addressed by a state agency, the Civil Service Merit Review Board, whose judgment was entitled to
full faith and credit in federal court.
II.
As observed above, because of this case’s unique procedural posture, we construe it as one
where the district court entered summary judgment sua sponte. Thus, we “review[] to determine if
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the court abused its discretion by entering the judgment on its own motion.” Sommer v. Davis, 317
F.3d 868, 696 (6th Cir. 2003) (“Factors to consider in making this determination include whether
the parties who would oppose such a judgment had notice that judgment could be granted against
them and whether they had a facially meritorious defense to the judgment.”). Nevertheless, “[l]egal
determinations . . . will always be reviewed de novo.” K&T Enterprises v. Zurich Ins. Co., 97 F.3d
171, 176-77 (6th Cir. 1996).
III.
This case presents the question whether a federal court may give an unreviewed state agency
decision preclusive effect to bar a Title VII claim. The district court relied upon University of
Tennessee v. Elliott, 478 U.S. 788 (1986), to hold that Hillman’s claim was precluded because the
issues had already been heard by a state agency acting in quasi-judicial capacity. Unfortunately, the
lawyers failed to point out that Elliott stands for an entirely contrary proposition. So we must reverse.
Federal claims that attempt to relitigate issues already heard in a state court (or reviewed by
a state appellate court) are barred in federal court by issue preclusion doctrine via the Full Faith and
Credit statute, 28 U.S.C. § 1738, which extends the principles embodied in the Full Faith and Credit
Clause of the U.S. Constitution. In Kremer v. Chem. Constr. Corp., 456 U.S. 461 (1982), the
Supreme Court held that a plaintiff’s Title VII claim was precluded under § 1738 because (a) he had
already lost before the state agency responsible for hearing his claims and (b) a state appellate court
affirmed that decision. Id. In a footnote, however, the Court stated that the outcome would likely
have been different had there been no state court review:
EEOC review of discrimination charges previously rejected by state agencies would
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be pointless if the federal courts were bound by such decisions . . . . Since it is settled
that decisions by the EEOC do not preclude a trial de novo in federal court, it is clear
that unreviewed administrative determinations by state agencies also should not
preclude such review even if such a decision were to be afforded preclusive effect in
a State’s own courts.
Id. at 470, n.7.
In Elliott, the Supreme Court directly addressed the situation contemplated in the Kremer
footnote. There, an employee, threatened with discharge, sought a state administrative hearing,
alleging that his discharge was racially motivated. An administrative law judge determinated that
there was no evidence of prejudice. Elliott did not seek review of that decision in state court, and
instead pursued Title VII and § 1983 claims in federal court. The defendant moved for summary
judgment, claiming that the ALJ’s determination was entitled to preclusive effect. The district court
agreed. This Court reversed on appeal, concluding that neither of his claims were precluded by the
unreviewed administrative decision.
The Supreme Court affirmed in part and reversed in part. The Court stated that the Full Faith
and Credit statute, § 1738, “governs the preclusive effect to be given the judgments and records of
state courts, and is not applicable [to] unreviewed state administrative fact-finding.” Elliott, 478
U.S. at 794 (emphasis added). Because the clause and statute did not control the case, the Court
“look[ed] to the policies underlying the Clause in fashioning” a “federal common-law rule[] of
preclusion.” Id. at 799. The Court held that, generally, as a matter of federal common law,
unreviewed administrative agency fact-finding must be given “the same preclusive effect to which
it would be entitled in the state courts.” Id. As a result, Elliott’s § 1983 claim was precluded by the
prior agency decision.
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This is the part of Elliott that Shelby County quotes to justify dismissing Hillman’s claims.
Yet this ignores Elliott’s other holding: although federal common law indicates that state agency
determinations may be given preclusive effect for some civil rights claims (like § 1983), the Court
also held that Congress did not intend that logic to apply to Title VII claims. Citing the Kremer
footnote, the Court reasoned that because Congress directed the EEOC to give “substantial weight
to final findings and orders made by State or local authorities in proceedings commenced under State
or local [employment discrimination] law,” 42 U.S.C. § 2000e-5(b), “it would make little sense for
Congress to write such a provision if state agency findings were entitled to preclusive effect in Title
VII actions in federal court.” Elliott, 478 U.S. at 795. Thus “Congress did not intend unreviewed
state administrative proceedings to have preclusive effect on Title VII claims.” Id. at 796. This
remains good law today.
Indeed, “[f]ollowing Elliott, circuit courts have uniformly held that unreviewed
administrative agency findings can never be afforded preclusive effect in a subsequent Title VII
action.” Rao v. County of Fairfax Virginia, 108 F.3d 42 (4th Cir. 1997) (collecting cases). The
Ninth Circuit has explained it well: “The clear teaching of Elliott is that in a Title VII action a prior
state decision enjoys issue preclusive effect only if rendered or reviewed by a court . . . . In contrast,
unreviewed administrative determinations lack preclusive effect in a subsequent Title VII action,
regardless of any preclusive effect state law might accord to them.” McInnes v. California, 943 F.2d
1088, 1093-94 (9th Cir. 1991). And the law of this Circuit is in line with this reading of Elliott. See
e.g., Zanders v. National R.R. Pass. Corp., 898 F.2d 1127, 1130 (6th Cir. 1990) (“Under the
Supreme Court’s interpretation of 28 U.S.C. § 1738, unreviewed state administrative proceedings
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are not entitled to full faith and credit by federal courts and thus have no preclusive effect upon
subsequent Title VII litigation in the federal courts.”).
So the current state of the law of the preclusive effect of administrative decisions on federal
civil rights claims can be summarized by three propositions. First, state agency determinations that
have been reviewed by a state court are entitled to statutory full faith and credit. 28 U.S.C. § 1738;
Kremer, 456 U.S. at 465. Second, as a matter of federal common law, a federal court may give
preclusive effect to the determination of an unreviewed state agency determination, if a state court
would similarly give the agency determination preclusive effect. Elliott, 478 U.S. at 799. And third,
because the law of preclusion is one of common law, Congress may direct that certain claims–like
Title VII claims–will not be precluded by unreviewed agency determinations. Id. at 796. Because
Hillman’s Title VII claim clearly falls into this third category, it was not precluded.
IV.
For the foregoing reasons, we REVERSE the district court’s dismissal of Hillman’s Title VII
claim and REMAND for further proceedings.