NOT PRECEDENTIAL
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
_____________
No. 16-4223
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JESSIE DENKINS; CHERYL SHELTON;
EMMA WARING; MAXINE CAMPBELL,
Appellants
v.
STATE OPERATED SCHOOL DISTRICT OF
THE CITY OF CAMDEN; PAYMON ROUHANIFARD;
ANGELA GILBERT; JOHN DOE; JANE DOE 1-10
______________
On Appeal from the United States District Court
for the District of New Jersey
(D.N.J.. No. 1-16-cv-00653)
District Judge: Honorable Jerome B. Simandle
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Submitted Under Third Circuit L.A.R. 34.1(a)
May 11, 2017
______________
Before: AMBRO, RESTREPO, and COWEN, Circuit Judges.
(Filed: November 9, 2017)
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OPINION*
______________
*
This disposition is not an opinion of the full Court and, pursuant to I.O.P. 5.7,
does not constitute binding precedent.
RESTREPO, Circuit Judge.
Jessie Denkins and other former school leaders in the city of Camden, New Jersey,
appeal the decision of the District Court to dismiss their § 1983 suit for deprivation of a
property interest without due process against the State Operated School District,
Superintendent Paymon Rouhanifard, former evaluator Angela Gilbert, and others, on the
basis of sovereign and qualified immunity. We will affirm.
I
As we write for the benefit of the parties, we set out only the facts necessary for
the discussion that follows. In 2013, the state of New Jersey took over the Camden
School District. As part of the full takeover, the State appointed a new superintendent,
Rouhanifard, accountable directly to the State’s Commissioner of Education. Early in his
tenure, Rouhanifard hired a group of school leader trainer/evaluators, including Angela
Gilbert. Those evaluators’ duties included observing and grading all school leaders in the
District on a four-point scale. Leaders with average scores falling below 3.0 stood at risk
of removal on the basis of ineffectiveness. Denkins and the other Plaintiff-Appellants
received evaluations, including at least one each from Gilbert, that prompted the District
to begin (or to threaten to begin) proceedings to adjudicate them as ineffective and
abrogate their tenure. Because such a finding would cause collateral consequences with
respect to their professional licensure and state pension, each of the Appellants
preemptively resigned rather than contest the low ratings.
2
While conducting school leader evaluations, Gilbert did not possess the license
required by then-existing state law for a person in her position. Prior to her hire, Gilbert
informed the District of this fact, but the District hired her anyway and allowed her begin
her job without even a provisional certification. When Appellants discovered this fact in
2015, they instituted this suit, alleging that they had been deprived of a property right to
their continued, tenure-protected employment without due process of law.1 The District
Court granted Defendants’ motions to dismiss pursuant to Federal Rule of Civil
Procedure 12(b)(6). For the State Operated School District, the District Court applied
sovereign immunity under the Eleventh Amendment. Rouhanifard received sovereign
immunity, as well. For Gilbert, the District Court dismissed on the basis of qualified
immunity. Plaintiffs appeal the dismissals as to all three Defendants.
II2
A
Under the Eleventh Amendment, a state is immune to suit from its own citizens.
Pennhurst State Sch. & Hosp. v. Halderman, 465 U.S. 89, 100 (1984). That immunity
1
Plaintiffs also raised other causes of action under state law, over which the
District Court declined to exercise supplemental jurisdiction after dismissing the federal
claims. The New Jersey state court is currently holding those state claims in abeyance
pending the outcome of this action.
2
The District Court had jurisdiction pursuant to 28 U.S.C. § 1331. We have
jurisdiction pursuant to 28 U.S.C. § 1291. Our standard of review of a District Court’s
grant of a motion to dismiss is plenary. N.Y. Shipping Ass’n Inc. v. Waterfront Comm’n
of N.Y. Harbor, 835 F.3d 344, 352 (3d Cir. 2016). On review, we apply the same
standard as the District Court. Id. To survive a motion to dismiss, a complaint must state
a claim to relief that is plausible on its face. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).
3
extends to entities that are not the state itself if the state is the real party in interest in the
suit. Edelman v. Jordan, 415 U.S. 651, 663 (1974). In assessing whether the state is the
real party in interest in suits against non-state public entities, our Court has set out a
comprehensive list of nine factors, Urbano v. Bd. of Managers, 415 F.2d 247 (3d Cir.
1969), cert. denied, 397 U.S. 948 (1970), and subsequently “divide[d] the nine Urbano
factors into three larger questions.” Fitchik v. N.J. Transit Rail Ops., Inc., 873 F.2d 655,
659 (3d Cir. 1989) (en banc). Those questions are: (1) whether the money that would pay
the judgment would come from the state treasury; (2) the status of the entity under state
law; and (3) the degree of autonomy of the entity. Id. Although we formerly assigned
primacy to the funding factor, we have recalibrated those factors at the direction of the
Supreme Court, and now weight them co-equally. First Jud. Dist. of Penn. v. Benn, 426
F.3d 233, 240 (3d Cir. 2005); see also Regents of Univ. of Calif. v. Doe, 519 U.S. 425,
431 (1997).
Our Court last addressed the sovereign immunity status of the Camden School
District in 2006, holding that the Board of Education was not an arm of the state and
therefore not deserving of sovereign immunity. Febres v. Camden Bd. of Educ., 445 F.3d
227, 228 (3d Cir. 2006). The parties agree that factual changes since Febres—
specifically, the full state takeover and the relocation of responsibilities from the Board to
the state-appointed Superintendent—necessitate a reassessment of that analysis. We
address each factor in turn.
4
State Treasury Factor
In assessing the state treasury prong of the Fitchik analysis, “[w]e consider three
subfactors: (1) a State’s legal obligation to pay a money judgment entered against the
alleged arm of the State; (2) alternative sources of funding (i.e., monies not appropriated
by the State) from which the entity could pay such judgments; and (3) specific statutory
provisions that immunize the State from liability for money judgments.” Maliandi v.
Montclair State Univ., 845 F.3d 77, 86 (3d Cir. 2016). Although the District Court
assessed this prong as supporting a grant of sovereign immunity for the School District,
we disagree.
With respect to the first subfactor, the State is not legally obligated to pay a
judgment entered against the District. Although the District might pay a judgment with
funds that originated with the State, the State is not legally obligated to pour additional
money into the budget to fund such a judgment. “Although the [state] might well choose
to appropriate money to [an entity] to enable it to meet a shortfall caused by an adverse
judgment, such voluntary payments by a state simply do not trigger Eleventh Amendment
immunity.” Febres, 445 F.3d at 234. By contrast, “a state’s legal liability (or lack
thereof) for an entity’s debts merits far greater weight, and is therefore the key factor in
our assessment of the state-treasury prong.” Id. at 236.
With respect to the second subfactor, alternative sources of funding, the Febres
Court explicitly rejected the argument that, because (at the time) 85% of the Camden
School District’s funding came from the State of New Jersey, the District could not
satisfy a judgment except with State money. Id. at 233. Noting that non-State funds
5
“still total a significant sum,” the Court rejected the idea that the city’s “relatively poor
tax base” ought to control the outcome. Id. at 233, 234. Holding to the contrary would
work an injustice against people seeking redress for wrongs committed by (or by
employees of) poorer school districts with less robust local tax bases. To the extent that
State dollars come with strings that abrogate local autonomy or increase State control, we
consider that dynamic under the appropriate Fitchik factor that addresses autonomy and
control.
The state treasury factor thus cuts against immunity.
Status Under State Law
“The second Fitchik factor requires us to ascertain the status of the agency under
state law, which includes such considerations as how state law treats the agency
generally, whether the entity is separately incorporated, whether the agency can sue or be
sued in its own right, and whether it is immune from state taxation.” Maliandi, 845 F.3d
at 91 (internal quotations omitted). In considering status under state law, “we have also
considered the entity’s authority to exercise the power of eminent domain, application of
state administrative procedure and civil service laws to the entity, the entity’s ability to
enter contracts and make purchases on its own behalf, and whether the entity owns its
own real estate.” Id.
The District Court found that “in light of the specific circumstances of the State
take-over,” the status under state law prong cut in favor of immunity. J.A. 18. We agree.
As Plaintiffs acknowledged in their complaint, N.J. Stat. Ann. § 18A:7A-34, titled
“Creation of school district under full State intervention upon determination of failure of
6
local school district,” applies to the Camden State Operated School District. J.A. 287.
Subsequent statutes concerning full State takeover make the status of such districts quite
clear.3
The second Fitchik factor weighs in favor of immunity.
Autonomy of the Entity
“Fitchik directs that autonomy be analyzed as a distinct factor, focusing on the
entity’s governing structure and the oversight and control exerted by a State’s governor
and legislature.” Maliandi, 845 F.3d at 96. “The lesser the autonomy of the entity and
greater the control by the State, the greater the likelihood the entity will share in the
State’s Eleventh Amendment immunity.” Id. In assessing state control, the Maliandi
Court looked to whether local boards were empowered to act “without recourse or
reference to any department or agency of the state,” id., and the number of “state-
imposed limitations” with minimal effect. Id. at 97. It considered whether the entity
N.J. Stat. Ann. § 18A:7A-35(a) (“The schools of a school district under full State
3
intervention may be conducted by and under the supervision of a State district
superintendent of schools appointed by the State board upon recommendation of the
commissioner.”); id. at 7A-35(f) (“The State district superintendent may, if deemed
appropriate by the commissioner, make, amend and repeal district rules, policies and
guidelines, not inconsistent with law for the proper conduct, maintenance and supervision
of the schools in the district.”); N.J. Stat. Ann. § 18A:7A-39(a)(1) (providing that the
State district superintendent takes over the power to “sue in the district’s corporate
name.”); id. at 7A-39(1)(d) (“all warrants for claims or expenditures approvable by a
district board of education . . . may be authorized by the State district superintendent.”);
id. at 7A-39(1)(e) (“Authority . . . relative to the acquisition and disposition of property
. . . may, in a school district under full State intervention, be exercised by the State
district superintendent.”); id. at 7A-39(1)(f) (“[T]he authority and powers vested in
boards of education by . . . New Jersey Statutes may in a school district under full State
intervention, be exercised by the State district superintendent.”).
7
could make “unregulated spending decisions,” and whether the people with decision-
making authority enjoyed for-cause protection. Id. at 98.
At the time of Febres, Camden’s school district was under a more limited form of
state intervention under the New Jersey Municipal Rehabilitation and Economic
Recovery Act (“MRERA”). Febres, 445 F.3d at 231. Under that law, the local school
board retained decision-making power, but its powers were subjected to the Governor’s
“constrained” veto power under MRERA’s “limited school district oversight.” Id. Even
under that fact pattern, the Febres Court held that the autonomy factor favored immunity.
Id. at 232. Since Febres, the Camden School District has transitioned from limited
intervention under the MRERA to full State intervention under N.J. Stat. Ann. § 18A:7A-
34 et seq. As described above, control of budgetary decisions and the day-to-day
governance of the school system is vested with a superintendent appointed by the State,
who enjoys no for-cause protection and exerts State policy and will. Given that the State
exercises more control over the District now than it did when the Febres Court
considered this issue and held that even that more limited intervention favored immunity,
we similarly hold that the autonomy factor weighs in favor of immunity.
In sum, two of the three co-equal Fitchik factors—status under state law, and
autonomy—weigh strongly in favor of immunity. Accordingly, we affirm the District
Court’s grant of sovereign immunity to the State Operated School District. See Benn,
426 F.3d at 240.
B
8
The District Court also granted Rouhanifard’s 12(b)(6) motion on the basis of
sovereign immunity. Sovereign immunity extends to both state agencies and state
officers, as long as the state is the real party in interest. Estate of Lagano v. Bergen Cty.
Prosecutor’s Office, 769 F.3d 850, 857 (3d Cir. 2014) (quoting Fitchik, 873 F.2d at 659).
Appellants’ primary argument for reversing the District Court on sovereign immunity for
Rouhanifard relies on the proposition that the State Operated District does not deserve
sovereign immunity for itself. Appellants’ Br. at 25. That argument is unavailing.
Even if analyzed distinctly, Rouhanifard deserves sovereign immunity in this
context, as the State is the real party in interest. As the State-appointed superintendent,
Rouhanifard “shall perform such duties and possess such powers as deemed appropriate
by the commissioner.” N.J. Stat. Ann. § 18A:7A-35(d). “[N]o person so appointed shall
acquire tenure nor shall the commissioner, with approval of the State board, be precluded
from terminating the superintendent’s services pursuant to the terms of the
superintendent’s individual contract of employment.” Id. at 7A-35(b). Appellants argue
that the New Jersey statutory section mandating that “[f]or the purpose of the New Jersey
Tort Claims Act . . . the State district superintendent shall be considered a State officer,”
N.J. Stat. Ann. § 18A:7A-35(b), does not answer the immunity question as to federal law
issues. Regardless of the answer to that question, the superintendent’s appointment by
the State’s Commissioner of Education, his/her lack of for-cause protection, and his/her
earning a salary set by the Commissioner, all suggest the superintendent’s status under
state law is as a state official, and that the superintendent lacks autonomy from the State.
We will affirm the District Court’s grant of sovereign immunity to Rouhanifard.
9
C
The District Court also granted Defendant Gilbert’s 12(b)(6) motion after finding
that she was entitled to qualified immunity. “The doctrine of qualified immunity protects
government officials from liability for civil damages insofar as their conduct does not
violate clearly established statutory or constitutional rights of which a reasonable person
would have known.” Pearson v. Callahan, 555 U.S. 223, 231 (2009). That two-step
analysis—was there a violation of a Constitutional right, and was the right clearly
established—may begin with either step. Id. at 236. We exercise our discretion to begin
with the second step of the analysis. Appellants may well make out a constitutional due
process violation in having been deprived of a property interest in continued tenure-
protected public employment, see Bd. of Regents v. Roth, 408 U.S. 564, 576 (1972), by
the District having obtained their involuntary resignations “by deceiving or mispresenting
a material fact to the employee,” Leheny v. City of Pittsburgh, 183 F.3d 220, 227 (3d Cir.
1999). At step two, however, we must assess whether a “reasonable official would
understand that what [s]he [did] violate[d] that right.” Anderson v. Creighton, 483 U.S.
635, 640 (1987).
To determine the objective reasonableness of an official’s action, “there must be
sufficient precedent at the time of action, factually similar to the plaintiff’s allegations, to
put defendant on notice that his or her conduct is constitutionally prohibited.” Mammaro
v. N.J. Div. of Child Protec. & Permanency, 814 F.3d 164, 169 (3d Cir. 2016) (citation
omitted). In context, we consider whether a reasonable school evaluator-trainer in
Gilbert’s position would have believed that her conduct was unlawful. Here, as Plaintiffs
10
admitted in their initial complaint, “[a]fter her acceptance of employment but prior to the
actual hire date, Defendant Gilbert provided to the Defendant District information that
she did not possess a valid New Jersey Administrator certificate/endorsement.” J.A. 289.
There exists no precedent “factually similar to the plaintiff’s allegations” that would have
put Gilbert on notice that evaluating the Plaintiffs after the District knowingly hired her
without a license might amount to a due process violation.
Therefore, we affirm qualified immunity as to Gilbert.
III
For the foregoing reasons, we will affirm the judgment of the District Court.
11
Jessie Denkins v. State Operated School District
Combined Opinion