BOGGS, Circuit Judge.
The Michigan Gaming Control Board (MGCB)
In 2010, the MGCB received an anonymous tip that certain harness-racing drivers were fixing races in concert with certain known gamblers. On May 19, 2010, Michigan State Police Detective Thomas DeClercq informed the harness drivers' then-attorney that the harness drivers would be arrested, criminally charged, and arraigned following an informal investigative hearing that had earlier been scheduled for May 20. At that hearing, the harness drivers asserted their Fifth Amendment right against self-incrimination and refused to answer questions. The following day,
On November 30, 2010, the MGCB issued "orders of exclusion" as to each harness driver. The MGCB took the position that it would not lift the exclusion orders unless the plaintiffs answered questions without legal representation. The harness drivers applied for 2011, 2012, and 2013 licenses without success. In response to the harness drivers' letters that sought to appeal "the deni[a]l of 2011 occupational license," the MGCB indicated that the exclusion orders precluded their consideration of the harness drivers' applications. Letter from Alexander Ernst, Horse Racing Manager, to John R. Moody (Nov. 16, 2011) (Ernst Letter).
In August 2012, the harness drivers filed this suit under 42 U.S.C. § 1983, seeking damages, costs, fees, and injunctive and declaratory relief. On November 27, 2013, the district court granted the MGCB's motion for summary judgment and denied the harness drivers' motion for partial summary judgment. The district court held that the Eleventh Amendment barred plaintiffs' claims for money damages against MGCB and its officials. And the district court held that the MGCB was entitled to qualified immunity because the harness drivers failed to identify the violation of a constitutional right.
"On appeal, this court reviews the district court's grant of summary judgment de novo." T-Mobile Cent. LLC v. Charter Twp. of W. Bloomfield, 691 F.3d 794, 798 (6th Cir.2012). Qualified immunity involves a two-step inquiry. Brown v. Lewis, 779 F.3d 401, 417 (6th Cir.2015). We must determine whether the facts viewed in the light most favorable to the plaintiffs show that a constitutional violation has occurred and whether the violation involved a clearly established constitutional
We consider five actions that may have violated the harness drivers' rights: (1) suspension of license because of refusal to self-incriminate without immunity, (2) exclusion from horse racing for same reason, (3) suspension without hearing, (4) exclusion without hearing, and (5) retaliation.
On the self-incrimination claims, we reverse the district court's grant of summary judgment. Based on the applicable law, the facts viewed in the light most favorable to the harness drivers show that the Constitution entitled the harness drivers to refuse to answer potentially self-incriminating questions, unless the state immunized them from prosecution. To punish the drivers violated the Constitution, and both suspension and exclusion constitute punishment. So the MGCB violated the harness drivers' constitutional rights against self-incrimination. Whether these rights were clearly established at the time remains a question. We remand the case for further proceedings. Cf. Dominque v. Telb, 831 F.2d 673, 677 (6th Cir.1987).
The harness drivers were due hearings on their suspensions and their exclusions. As we explain below, they were granted due process on their suspensions. We affirm the judgment of the district court on the due-process claim concerning suspensions. The harness drivers were not granted due process on their exclusions. But, for reasons explained below, the absence of that process may have resulted from the harness drivers' own failure to act. We reverse the grant of summary judgment on the due-process claims concerning exclusions and remand for further relevant proceedings.
Finally, the retaliation claims are not properly before us.
The privilege against self-incrimination applies more broadly than the bare text of the Fifth Amendment might suggest. A few examples demonstrate the privilege's practical reach. The privilege against self-incrimination applies in civil as well as criminal proceedings. Malloy v. Hogan, 378 U.S. 1, 11, 84 S.Ct. 1489, 12 L.Ed.2d 653 (1964); see also Fieger v. U.S. Att'y Gen., 542 F.3d 1111, 1120 (6th Cir. 2008) (observing that "the fulcrum of the Fifth Amendment privilege is the potential for self-incrimination, not the nature of the instant proceeding" (citing Bialek v. Mukasey, 529 F.3d 1267, 1272 (10th Cir. 2008))). It protects against the use in prosecution of police officers of incriminating statements that they made when given the choice "to forfeit their jobs or to incriminate themselves." Garrity v. New Jersey, 385 U.S. 493, 497, 87 S.Ct. 616, 17 L.Ed.2d 562 (1967).
When the questioned persons make the inverse choice under the same sort of duress, i.e., they prefer to forfeit their jobs rather than incriminate themselves, the privilege protects them. Cf. id. at 498, 87 S.Ct. 616; Union Pac. R.R. Co. v. Pub. Serv. Comm'n, 248 U.S. 67, 70, 39 S.Ct. 24, 63 L.Ed. 131 (1918). It is "clearly established ... that public employers may not coerce their employees to abdicate
Nor does the privilege protect only state employees. It protects a contractor, such as an architect, against the cancellation of state contracts and disqualification from receiving subsequent contracts. Lefkowitz v. Turley, 414 U.S. 70, 94 S.Ct. 316, 38 L.Ed.2d 274 (1973). It protects from dismissal from his position a political-party officer in the same situation. Lefkowitz v. Cunningham, 431 U.S. 801, 97 S.Ct. 2132, 53 L.Ed.2d 1 (1977).
Here, the MGCB did not offer the harness drivers — state licensees — immunity before the hearing on May 20, 2010. So the harness drivers had reason to fear that, had they responded to questions during the 2010 hearing with incriminating answers, prosecutors would use those answers as evidence, although a court would have been unlikely to admit those answers, given the law laid out in Garrity and its sequellae. In this situation, the Constitution entitled the harness drivers to assert the privilege against self-incrimination and thus to refuse to answer the MGCB's questions. To ban them from horse racing for refusing to answer was exactly the sort of "grave consequence solely because [t]he[y] refused to waive immunity from prosecution and [to] give self-incriminating testimony" that the Supreme Court has said unconstitutionally compels self-incrimination. Cunningham, 431 U.S. at 807, 97 S.Ct. 2132.
The district court relied on Chavez v. Martinez, 538 U.S. 760, 123 S.Ct. 1994, 155 L.Ed.2d 984 (2003), for the proposition that mere compulsion does not violate the Fifth Amendment. In that case, a man exchanged gunfire with police and later was interrogated by a police officer while in excruciating pain from face wounds and in emergency treatment for the same. The state never used the fruits of this interrogation for any reason. The man sued the police officer under 42 U.S.C. § 1983 for violating his constitutional rights. The Ninth Circuit held that the officer had violated his rights. A divided Supreme Court, producing five different opinions, reversed and remanded.
Justice Souter, writing for himself and Justice Breyer, suggested that the Court's "decision requires a degree of discretionary judgment greater than Justice Thomas acknowledges." Id. at 777, 123 S.Ct. 1994 (Souter, J., concurring). Given the facts presented, however, Justice Souter agreed with Justice Thomas that the officer had not violated the underlying plaintiff's rights.
This case presents a situation different from that presented by Chavez. In Chavez, the underlying plaintiff did answer the police officer's questions; the state did not use those answers to incriminate him; the Court held that this state of affairs did not violate the plaintiff's constitutional rights. Here, the harness drivers declined to answer questions, standing on their rights not to incriminate themselves. Solely because the harness drivers asserted these rights, the MGCB both suspended their occupational licenses and also banned them from receiving new licenses. Had the state threatened to revoke their licenses but, after the plaintiffs asserted their rights against self-incrimination, not revoked their licenses at all (or revoked their licenses only on account of and only after a process proving their involvement in illegal gambling), we would have a different case. In other words, "Chavez only applies where a party actually makes self-incriminating statements ... [T]he Fifth Amendment would be violated if a public employee were fired for refusing to make self-incriminating statements, even though no self-incriminating statement could ever have been used against the employee." Aguilera v. Baca, 510 F.3d 1161, 1179 (9th Cir.2007) (Kozinski, J., dissenting "for the most part").
Like Chavez, McKinley does not apply here. As Justice Thomas acknowledged in Chavez, "governments may penalize public employees and government contractors... to induce them to respond to inquiries [only] so long as the answers elicited ... are immunized from use in any criminal case against the speaker." Chavez, 538 U.S. at 768, 123 S.Ct. 1994 (plurality op.) (emphasis added). Here, plaintiffs asserted their rights clearly on May 20, 2010. But, for four years, the state declined to offer immunity or to allow plaintiffs to make a living at the racetrack.
The district court cited some cases without precedential authority and inapposite here. First, the district court cited Aguilera v. Los Angeles, 510 F.3d 1161 (9th Cir.2007). In Aguilera, the plaintiffs had been threatened with transfer to less prestigious "job assignments and work shifts," not total discharge. Id. at 1171; see also id. at 1173 (distinguishing "re-assignment from field to desk duty" from "losing one's job").
We turn to the process due to the harness drivers prior or subsequent to their suspension and exclusion. "The touchstone of due process is protection of the individual against arbitrary action of government." Wolff v. McDonnell, 418 U.S. 539, 558, 94 S.Ct. 2963, 41 L.Ed.2d 935 (1974) (citing Dent v. West Virginia, 129 U.S. 114, 123, 9 S.Ct. 231, 32 L.Ed. 623 (1889)). The Supreme Court has explained that identifying
Mathews v. Eldridge, 424 U.S. 319, 335, 96 S.Ct. 893, 47 L.Ed.2d 18 (1976).
"[T]he ordinary principle [is] that something less than an evidentiary hearing is sufficient prior to adverse administrative action." Id. at 343, 96 S.Ct. 893. But the courts, not the state, decide where that principle applies. A state may not condition a statutory entitlement on a beneficiary's acceptance of process so minimal that it fails to satisfy constitutional standards. See Cleveland Bd. of Educ. v. Loudermill, 470 U.S. 532, 105 S.Ct. 1487, 84 L.Ed.2d 494 (1985).
The district court suggested that plaintiffs do not have a liberty interest in an occupation in the horse-racing industry and that plaintiffs do not have a property interest in the "mere expectation of being licensed by the Racing Commissioner" (emphasis added). But the harness drivers need only to demonstrate property interests — the harness drivers can demonstrate that they have a property interest in their licenses in two ways.
First, the Supreme "Court has consistently held that some kind of hearing is required at some time before a person is finally deprived of his property interests. The requirement for some kind of hearing applies to ... the revocation of licenses...." Wolff, 418 U.S. at 557-58, 94 S.Ct. 2963 (citing Joint Anti-Fascist Refugee Cmte. v. McGrath, 341 U.S. 123, 168, 71 S.Ct. 624, 95 L.Ed. 817 (1951) (Frankfurter, J., concurring); and In re Ruffalo, 390 U.S. 544, 88 S.Ct. 1222, 20 L.Ed.2d 117
In Michigan, the racing commissioner can license people to participate in horse racing and wagering and can promulgate rules to that effect. M.C.L. 431.307(1). In addition, "[t]he racing commissioner may ... investigate ... a licensee... to ensure compliance...." M.C.L. 431.307(7). To that end,
M.C.L. 431.316(7). The Michigan Administrative Procedures Act, in turn, provides that "[t]he parties [in a contested case] shall be given a reasonable notice of the hearing, which notice shall include:.... [a] reference to the particular sections of the statutes and rules involved" and "the issues involved." M.C.L. 24.271(2). Because Michigan has established a process for appealing suspensions of licenses, the harness drivers had property interests in their licenses.
Second, although a state statute "does not affront the Due Process Clause by
The harness drivers received a postsuspension hearing in Michigan state court. Whether or not plaintiffs ought to have received, as matter of Michigan state law, an additional hearing in front of an administrative agency does not affect the federal constitutional analysis. So we affirm the district court's grant of summary judgment insofar as it held that the defendants' suspension of plaintiffs did not violate the plaintiffs' due-process rights.
In November and December 2010, Richard Kalm, Executive Director of the MGCB, issued orders of exclusion as to each harness driver. Each order proceeded in the same way. Each identified the harness driver as a licensee suspended for "failing to comply with the conditions precedent for occupational licensure...." See, e.g., Kalm, Order of Exclusion In the Matter of John Moody at 1 (Nov. 30, 2010) (citing M.C.L. 431.316(1); and 1985 M.R. 6, R 431.1035). Reciting that the harness driver had "asserted that he had the right to invoke a 5th Amendment right against self-incrimination in response to questions asking whether he ever failed to give his best efforts in a race or ever accepted money to alter the outcome of a race," the Order stated that "[b]ased on the continued and ongoing administrative investigation into race fixing, information that [the plaintiff] was involved in race fixing, and his failure to cooperate, [he] ... is to be excluded from horse racing tracks.... [Kalm] deems it necessary to be proactive to preserve the integrity of horse racing in the State of Michigan and to protect the public health, safety and welfare." See, e.g., id. at 1-2 (emphasis added).
The harness drivers were due the process of a postexclusion hearing for the two reasons that they were due the same for their suspensions: the general principle of a hearing before final or permanent deprivation, and the Barry Court's holding that the suspension of a jockey's license entitles him to a post-deprivation hearing. We also note that the Exclusion Orders seem to contemplate as much: the Order concluded by acknowledging that "[u]pon written request, [the plaintiff] has a right to a hearing de novo before the Executive Director." Ibid. The harness drivers were due the process of a hearing, which they did not receive.
But the harness drivers would fail on this due-process claim, as well, if they had failed to request a hearing. On the harness drivers' account, they "awaited the outcome in the Michigan Court of Appeals" before requesting a hearing about their exclusion. Appellant Br. 36. That court issued its decision on July 21, 2011, declaring the issue of the suspension of 2010 licenses moot. The harness drivers claim that, in August 2011, they "called and met with Defendants regarding re-licensure...." Ibid. According to the harness drivers, the MGCB ultimately took the position that the relevant rules and regulations entitled plaintiffs to appeal only within ten days of the order of exclusion. Ibid. In a letter dated November 16, 2011, the MGCB's Horse Racing Manager stated that "the time to appeal the Exclusion Order has long passed." Ernst Letter. Similarly, on January 13, 2012, the MGCB told the harness drivers that "an Exclusion Order was entered against you that you did not appeal. As such, you are excluded
The regulation under which the Racing Commissioner excluded the plaintiffs provides that:
Mich. Admin. Code R. 431.1130(3). The language of the regulation seems not to contemplate a deadline for appeal. The harness drivers do not demonstrate that they ever clearly submitted "a written request" for review.
That omission still does not end the inquiry. No one disputes that, despite the Exclusion Orders in late 2010, the harness drivers applied for 2011 licenses (and, subsequently, for 2012, 2013, and 2014 licenses). A reasonable juror might conclude that the MGCB should have construed those applications as requests for the hearings due to them under the federal constitution and state regulations. After all, the MGCB seemed to construe the harness drivers' applications for 2011 licenses as an "attempt[t] to recreate either an administrative or judicial appeal process." Ernst Letter. If the MGCB, in point of fact, did construe the harness drivers' applications as written requests for appeal, then the harness drivers were due the process of a hearing concerning their Exclusion Orders. Such an outcome makes policy sense. If a licensee regards his un-reviewed exclusion from licensure to be an error, and so applies for a license, due-process doctrine favoring hearings prior to final deprivation would seem to require that his application trigger the review owed to him.
We hold that there is a disputed issue of material fact as to whether the defendants denied plaintiffs the process they were due or whether the plaintiffs failed to seek that process. We reverse the grant of summary judgment on plaintiffs' due-process claims that they were denied their rights to a hearing after their exclusion and remand the question to the district court.
After discovery, plaintiffs moved to amend their complaint to include a First Amendment retaliation claim. The district court denied that motion. We do not review the district court's denial because, as the MGCB correctly suggests, "the Harness Drivers have not appealed the District Court's denial of leave to amend the Complaint" to include a First Amendment retaliation claim. Appellee Br. 38.
Because we reverse summary judgment, the case will return to the district court. There, plaintiffs can move for the district court to reconsider its decision to deny plaintiffs' motion to amend its complaint. If the district court denies that motion, the plaintiffs can appeal that denial after final judgment.
In conclusion, we AFFIRM the district court's grant of summary judgment to the MGCB on the harness drivers' due-process claims about their suspensions. We REVERSE the district court's grant of summary judgment to the MGCB on the harness drivers' due-process claims about their exclusions and self-incrimination claims, and REMAND the case to the district court for further proceedings on these three issues: did the harness drivers request hearings on their exclusions, did their self-incrimination and due-process claims involve clearly established rights, and, if so, should an officer in the MGCB's position have known about those rights? If, on a pretrial motion or after trial, the district court finds that the MGCB is liable on one or more of the harness drivers' claims, the district court should determine what damages the MGCB owes the harness drivers.
Chavez resulted in a remand to the Ninth Circuit on substantive-due-process grounds. Had Justices Kennedy, Stevens, and Ginsburg insisted on their "position, there would be no controlling judgment of the Court." Chavez, 538 U.S. at 799, 123 S.Ct. 1994 (Kennedy, J., concurring in part and dissenting in part). Instead, Justice Kennedy allowed the Court to dispose of the case by remanding it and suggested that substantive due process could protect most of the rights outlined in the Self-Incrimination Clause. Ibid.