United States Court of Appeals,
Fifth Circuit.
No. 95-10314
Summary Calendar.
Ray VERA, dba Vera's Bonding Company, and Larry Vera, dba Vera's
Bonding Company, Plaintiffs-Appellants,
v.
Charles TUE, Sheriff of Hale County, TX, et al., Defendants-
Appellees.
Jan. 31, 1996.
Appeal from the United States District Court for the Northern
District of Texas.
Before KING, SMITH and BENAVIDES, Circuit Judges.
BENAVIDES, Circuit Judge:
The principal issue on this appeal is whether the district
court properly held that the Sheriff was entitled to immunity from
this civil rights suit. Finding that the Sheriff was not so
entitled, we reverse in part and affirm in part.
I. FACTS AND PROCEDURAL HISTORY
Ray Vera, d/b/a Vera's Bonding Company, and Larry Vera, d/b/a
Vera's Bonding Company (collectively the Bonding Company), filed
the instant civil rights suit under 42 U.S.C. § 1983 against
Charles Tue, Sheriff of Hale County, Texas, and Hale County, Texas,
alleging libel, slander, official misconduct, and denial of due
process and equal protection in suspending the Bonding Company's
right to act as surety on bail bonds. The Bonding Company alleged
the following facts in the complaint. The Bonding Company provided
surety bonds in Hale County, Texas, for persons accused of criminal
1
offenses seeking to obtain release pending trial. The surety bonds
were tendered to various courts and officers for approval,
including Sheriff Tue.
In October 1990, Sheriff Tue gave written notice "[t]o Whom It
May Concern" that "Vera Bonding Company will not be allowed to make
a bond exceeding $500...." After receiving the notice, Larry Vera,
through counsel, contacted Sheriff Tue; the parties compromised,
and the notice was withdrawn.
Two years later, on October 29, 1992, Sheriff Tue sent a
letter to the Bonding Company advising that "[e]ffective November
5, 1992, all your bonding privileges in Hale County will be
suspended." The letter listed certain reasons for the suspension.
Sheriff Tue purported to act for all magistrates and other officers
located in Hale County, Texas, authorized by law to approve surety
bonds. The letter indicated that copies were sent to nine judges
of various courts in Hale County, Texas. The Bonding Company
replied to the letter through counsel, requesting that Sheriff Tue
substantiate his contentions. Sheriff Tue responded but refused to
furnish much of the information requested.
The Bonding Company filed suit in state court against Sheriff
Tue and Hale County seeking a temporary injunction, a permanent
injunction, and damages. After a hearing, the trial court denied
the request for a temporary injunction. Ultimately, the suit was
dismissed without prejudice for want of prosecution.
The Bonding Company subsequently filed the instant suit in the
district court. The defendants answered the Bonding Company's
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complaint, raising the defenses of qualified and sovereign
immunity. The defendants also filed a motion for summary judgment,
or in the alternative a motion to dismiss, attaching Sheriff Tue's
affidavit in support of the motion. Sheriff Tue asserted that he
suspended the Bonding Company's bail bond writing privileges
because: Larry Vera solicited jail trustees for assistance in
making bonds, Larry Vera perused jail records without authorization
to discover information, Vera was disrespectful to the judges, and
the Bonding Company's ratio of collateral to outstanding bonds fell
below the acceptable level after Raul Vera withdrew his portion of
the company's collateral. Sheriff Tue also stated that he was
"aware of no statute, court decision, or other law which provides
for a procedure to follow when a Texas sheriff, in exercising his
duty of oversight under the state law of Texas, determines that
bail bonds should not be accepted from certain sureties."
The Bonding Company filed a response, attaching Larry Vera's
affidavit in support. In that affidavit, Larry Vera denied, among
other things: violating the terms of the 1990 compromise between
Sheriff Tue and the Bonding Company; looking at the jail records
without permission; entering any secured part of the jail without
authorization; bonding anyone over the amount of $7,500 without
authorization. The affidavit also provided that:
Sheriff Tue's actions taken against me are based on personal
grievances and personal interests. Sheriff Tue's wife, Kay
Tue, was working for Ace Bail Bonding, in Hale County, in
October of 1992. Sheriff Tue's sister-in-law is also employed
and/or is the owner of Exit Bail Bonds in Hale County. I
believe that since my business made the majority of the bonds
in Hale County that Sheriff Tue was trying to put me out of
business so that Exit Bail Bonding would thereafter prosper.
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The district court granted summary judgment for the
defendants, concluding that the Bonding Company failed to indicate
how its right to earn a living by writing bail bonds was deprived
by the Sheriff. It also determined that because the Bonding
Company "failed to demonstrate that Defendant's acts were
irrational, [the Bonding Company] ... failed to properly establish
their equal protection claim." The court concluded that because
the Bonding Company "failed to establish deprivation of a property
or liberty interest, Defendant's qualified immunity remains intact,
protecting him from liability in this matter." In its order
granting summary judgment, the district court did not address
explicitly the Bonding Company's claims against Hale County, Texas.
Nonetheless, its written judgment granted summary judgment in favor
of both defendants.
II. STANDARD OF REVIEW
This Court reviews a grant of summary judgment de novo, using
the same standard applicable in the district court. Matagorda
County v. Law, 19 F.3d 215, 217 (5th Cir.1994). "Summary judgment
is appropriate if the record discloses "that there is no genuine
issue as to any material fact and that the moving party is entitled
to judgment as a matter of law.' " Id. (quoting Fed.R.Civ.P.
56(c)). "The pleadings, depositions, admissions, and answers to
interrogatories, together with affidavits, must demonstrate that no
genuine issue of material fact remains." Id. at 217. Inferences
from the facts are drawn most favorably to the nonmovant. If the
record as a whole could not lead a rational trier of fact to find
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for the nonmovant, then there is no genuine issue for trial. Id.
III. QUALIFIED IMMUNITY
We must determine whether the district court erred in
granting Sheriff Tue qualified immunity. The first step in this
two-step analysis is to determine whether the plaintiff has
asserted the violation of a clearly established constitutional
right under the prevailing state of the law. Al-Ra'id v. Ingle, 69
F.3d 28, 31 (5th Cir.1995). If so, we then must decide whether the
defendant's conduct was objectively reasonable in light of the law
at the time of the conduct in question. Id. In other words, if a
reasonable official would know that his actions were in violation
of the plaintiff's constitutional rights, it would lead to a
conclusion that the conduct was not objectively reasonable.
The Bonding Company contends that the right to earn a living
by writing bail bonds is a property interest protected by the Texas
Constitution. In support of that contention, it cites Font v.
Carr, 867 S.W.2d 873 (Tex.App.—Houston [1st Dist.] 1993) and Smith
v. Decker, 158 Tex. 416, 312 S.W.2d 632 (1958). Sheriff Tue argues
that the cases cited by the Bonding Company are inapplicable
because those cases deal with the effect of Texas statutes that
govern the bail bond business in counties containing populations of
a certain size, and Hale County does not fall within that statutory
range. See Tex.Rev.Civ.Stat.Ann., Art. 2372p-3.1
1
Article 2372p-3 applies to counties with a population of
more than 110,000 or counties of less than 110,000 if a bail
board has been created. That provision governs the licensing and
regulation of bail bondsmen.
5
Although it is true that, unlike the bail bond businesses
involved in Font and Smith, the bond business in Hale County is not
governed by article 2372p-3 or its predecessor, we are not
convinced that the above-cited cases may be read so narrowly.
Indeed, in Font, the Texas Supreme Court plainly stated that "[t]he
right to earn a living by writing bail bonds is a property interest
protected by the Texas Constitution." 867 S.W.2d at 875.
Moreover, in Smith, the Texas Supreme Court explained that the
appellants, who were in the business of writing bail bonds, had "a
vested property right in making a living, subject only to valid and
subsisting regulatory statutes...." Accordingly, it appears that
article 2372p-3 does not create the property interest but instead,
Additionally, the parties agree that Article 17.11 of
the Texas Code of Criminal Procedure governs the bail bond
business in Hale County. Art. 17.11 provides as follows:
Every court, judge, magistrate or other officer
taking a bail bond shall require evidence of the
sufficiency of the security offered; but in every
case, one surety shall be sufficient, if it be made to
appear that such surety is worth at least double the
amount of the sum for which he is bound, exclusive of
all property exempted by law from execution, and of
debts or other encumbrances; and that he is a resident
of this state, and has property therein liable to
execution worth the sum for which he is bound.
Provided, however any person who has signed as a
surety on a bail bond and is in default thereon shall
thereafter be disqualified to sign as a surety so long
as he is in default on said bond. It shall be the duty
of the clerk of the court wherein such surety is in
default on a bail bond, to notify in writing the
sheriff, chief of police, or other peace officer, of
such default. A surety shall be deemed in default from
the time the trial court enters its final judgment on
the scire facias until such judgment is satisfied or
set aside.
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serves only to regulate the property interest of writing bail
bonds.
Alternatively, assuming for purposes of this appeal that
Sheriff Tue's restricted interpretation of the Texas cases is
correct, we find that the Bonding Company has shown the existence
of an interest protected by due process. The Supreme Court has
explained that "[w]here a person's good name, reputation, honor, or
integrity is at stake because of what the government is doing to
him, notice and an opportunity to be heard are essential." Board
of Regents of State Colleges v. Roth, 408 U.S. 564, 573, 92 S.Ct.
2701, 2707, 33 L.Ed.2d 548 (1972) (internal quotation marks and
case citations omitted) (brackets in opinion). As such, due
process requires an opportunity to refute the allegations before
the accusing officials.
In the case at bar, in the previously mentioned 1990 written
notice, Sheriff Tue declared that Vera Bonding Company was not
allowed to make a bond exceeding $500 "due to being eight to ten
times overextended on their collateral." Sheriff Tue asserted that
"on several occasions Larry Vera has exhibited some very bad
conduct toward both Judge Frank Curry and to Judge Bill Hollars.
(one case almost resulting in Judge Curry holding him in contempt
of court)." Also in that letter, Sheriff Tue accused Vera of
offering to pay the jail trusty to solicit bonding business.
Subsequently, a compromise was reached, and the notice withdrawn.
Two years later, Sheriff Tue notified the Bonding Company that
all its bonding privileges in Hale County were suspended. Sheriff
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Tue set forth certain reasons for the suspension; including
allegations that Vera had solicited bonds for gain, nineteen bond
forfeitures (some of which had settled), complaints from the judges
regarding Vera's dress and demeanor, and the amount of outstanding
bonds exceeded the "limit" (especially after Raul Vera removed his
collateral). As previously set forth, the letter indicated that
Sheriff Tue sent copies of this letter to nine judges.
In view of the allegations made by Sheriff Tue against Vera in
the process of suspending the Bonding Company's privileges, it is
clear that Vera's reputation and integrity were at stake. See
Roth, 408 U.S. at 573, 92 S.Ct. at 2707. Therefore, notice and an
opportunity to be heard were essential to protect Vera's rights.
In the letter suspending the Bonding Company's privileges, Sheriff
Tue expressly denied Vera an opportunity to refute the allegations;
instead, Sheriff Tue derisively invited Vera to file suit.
Accordingly, the Bonding Company has asserted the violation of a
clearly established constitutional right under the current state of
the law.
We must now determine whether Sheriff Tue's conduct was
objectively reasonable at the time he suspended the Bonding
Company's privileges. In Edmonson v. County of Van Zandt, Nos. 92-
4727, 93-4079, 93-4431, 15 F.3d 180 (5th Cir. Jan. 14, 1994)
(unpublished), the owner of Canton Bail Bonds (Edmonson) filed a §
1983 action against several defendants, including the Sheriff of
Van Zandt County, alleging a conspiracy to monopolize the bail bond
business in the County and to drive him out of business. The
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district court found the defendants liable and enjoined them from
impeding Edmonson's bail bond business.
On appeal, this Court noted that the Sheriff had revoked
Edmonson's bail bonding license on at least three occasions without
providing any notice and thereafter refused to provide Edmonson
with access to the information on which the suspension was based.
We easily concluded that Edmonson's bail bonding license was a
property right that entitled him to some due process protection,
explaining that "[i]t is well established that "a reasonable,
continued expectation of entitlement to a previously acquired
benefit constitutes a cognizable property interest for purposes of
due process protection.' " Edmonson, slip op. at 4 (citations and
internal quotation marks omitted).2 We then opined that "it was
clearly established that some process was due before Edmonson could
be deprived of his license." Edmonson, slip op. at 4. Because the
sheriff's department provided no process to Edmonson prior to the
revocation of the license, a clearly established right was
violated.
In regard to the second step of the qualified immunity
analysis, the Sheriff in Edmonson argued that simply preferring one
bail bonding company over another had not been previously held to
2
Our opinion provided that Edmonson had a bail bondsman
license in Van Zandt County, which indicates that the bonding
business in Van Zandt County was governed by Article 2372p-3.
Therefore, although we found that Edmonson, a Texas bail
bondsman, had a clearly established property right entitling him
to due process protection, we did not address the question
(raised by the instant defendants) whether a bondsman in a county
that was not regulated by article 2372p-3 had a protected
property interest in writing bonds.
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be unlawful and thus the sheriff's conduct was objectively
reasonable at that time. We rejected that argument, concluding
that "[t]he contours of the rights at issue were sufficiently clear
that a reasonable official would understand that Defendants'
particular acts did violate those rights." Edmonson, slip at 4-5.
We then listed the particular acts3 and explained that "[n]o
reasonable officer could conclude that such invidiously
discriminatory conduct and policies would not infringe Edmonson's
rights." Id. at 5.
Similarly, in the instant case, we find that no reasonable
official could conclude that suspending Vera's bonding privileges
without providing him an opportunity to refute the previously
referenced allegations would not violate Vera's procedural due
process rights. Therefore, we reverse the district court's grant
of summary judgment in favor of Sheriff Tue on this claim.
Hale County, citing Monell v. Department of Social Services,
436 U.S. 658, 98 S.Ct. 2018, 56 L.Ed.2d 611 (1978), argues that it
may not be held liable for the actions of Sheriff Tue because the
matters in question are not under the control of the Commissioners
Court, the governing body of Hale County. We have previously
3
We listed the following acts:
[T]hey enforced discriminatory treatment of Edmonson by
instructing employees to deny Edmonson and his company
privileges enjoyed by [Free State Bail Bond Service],
by harassing or intimidating jailers who questioned the
policy of favoritism towards [Free State Bail Bond
Service], by rewarding jailers or trusties who approved
of their policy or treated her business preferentially,
by harassing Edmonson, and by allowing and encouraging
solicitation of business only for Free State.
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determined that holding a Texas county liable for the actions of
its sheriff "does not run afoul of Monell's admonition against
respondeat superior liability on the part of the county for the
actions of its employees." Turner v. Upton County, Tex., 915 F.2d
133, 137 (5th Cir.1990), cert. denied, 498 U.S. 1069, 111 S.Ct.
788, 112 L.Ed.2d 850 (1991). We explained that the Sheriff, an
elected county official, had equal authority to the county
commissioners in that jurisdiction and that his actions constituted
those of the county just as much as those of the commissioners.
Id.; accord Familias Unidas v. Briscoe, 619 F.2d 391, 404 (5th
Cir.1980). Hale County is therefore liable for Sheriff Tue's
actions. The district court's grant of summary judgment in favor
of Hale County on this claim also must be reversed.
IV. EQUAL PROTECTION CLAIM
The Bonding Company argues that the defendants violated its
equal protection rights because the defendants' actions were not
rationally related to any governmental interest. The equal
protection clause "essentially" directs states to treat "all
persons similarly situated" alike. City of Cleburne, Tex. v.
Cleburne Living Center, 473 U.S. 432, 439, 105 S.Ct. 3249, 3254, 87
L.Ed.2d 313 (1985). It is violated only by intentional
discrimination. Lavernia v. Lynaugh, 845 F.2d 493, 496 (5th
Cir.1988). "Discriminatory purpose ... implies more than intent as
violation or as awareness of consequences[.] ... It implies that
the decisionmaker singled out a particular group for disparate
treatment and selected his course of action at least in part for
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the purpose of causing its adverse effect on an identifiable
group[.]" Id. (internal quotations, citations, and footnote
omitted) (emphasis in opinion). A violation of the equal
protection clause occurs only when, inter alia, the governmental
action in question classifies or distinguishes between two or more
relevant persons or groups. Brennan v. Stewart, 834 F.2d 1248,
1257 (5th Cir.1988).
The Bonding Company contends that it submitted summary
judgment evidence to the district court showing that Sheriff Tue's
sister-in-law and Sheriff Tue's wife had financial interests in
competing bonding companies in the Hale County area. Vera's
allegations, however, do not indicate that the Bonding Company was
a member of an identifiable group for equal protection purposes.
"[I]f the challenged government action does not appear to classify
or distinguish between two or more relevant persons or groups, then
the action—even if irrational—does not deny them equal protection
of the laws." Brennan, 834 F.2d at 1257. Viewing the facts in the
light most favorable to the Bonding Company, all it has shown is
nepotistic favoritism on the part of Sheriff Tue. Thus, the
district court did not err in granting summary judgment for Sheriff
Tue and Hale County on the Bonding Company's equal protection
claim.
Accordingly, the district court's grant of summary judgment is
AFFIRMED IN PART and REVERSED IN PART.
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