author: HAIGHT, District Judge:

text:
    UNITED STATES of America, v. Ida MOSS, Defendant.
    No. 85 Cr. 576-CSH.
    United States District Court, S.D. New York.
    Jan. 22, 1986.

      Rudolph W. Giuliani, U.S. Atty., S.D. N.Y., New York City, for the U.S.; David Spears, Asst. U.S. Atty., of counsel.

      Caesar D. Cirigliano, The Legal Aid Society, Federal Defender Services Unit, New York City, for defendant; Leonard F. Joy, of counsel.
   MEMORANDUM OPINION AND ORDER

HAIGHT, District Judge:

The United States charged defendant Ida Moss in a two count indictment with two substantive violations of 18 U.S.C. § 656. The defendant having waived a jury, trial was to the Court. The Government asserts alternative bases of Moss’s culpability: as a principal, and as an aider and abettor under 18 U.S.C. § 2.

At the pertinent times Moss was an employee of the Chemical Bank branch at 55 Water Street in Manhattan. The Chemical Bank (hereinafter “Chemical”) is insured by the Federal Deposit Insurance Corporation.

18 U.S.C. § 656 provides in part: “Whoever, being an ... employee of ... any insured bank ... embezzles, abstracts, purloins or willfully misapplies any of the moneys, funds or credits of such bank or any moneys, funds, assets or securities intrusted to the custody or care of such bank, or to the custody or care of any such ... employee ..., shall be fined not more than $5,000 or imprisoned not more than five years, or both; ...” (emphasis added).

In quoting from the statute, I have emphasized the phrase upon which, given the facts of the case, the Government particularly relies.

I.

Chemical’s “Lockbox” Operation

At its 55 Water Street branch, Chemical maintains a “remittance banking” department, also known as a “lockbox” department. I shall use the latter phrase.

Chemical offers its lockbox services to depositors whose business generates large numbers of checks payable to the depositors. Rather than bringing its checks to the bank for individual deposit, such a depositor instructs its debtors to mail checks to a post office box maintained by Chemical. A bank employee picks up the mail at the post office daily. The mail is then delivered to the lockbox department of the bank, which at the pertinent times employed about 70 people.

Checks coming into the lockbox department are processed by bank employees with such titles as “mail extractors,” “work flow coordinators,” “listers,” and “data capture clerks.” These job titles accurately reflect what the individuals do. In short, each check coming into the lockbox department is “extracted” from its envelope, photocopied, reviewed for negotiability, entered on a listing tape compiled in respect of the particular payee-depositor, and its details punched into the computer. The checks are then deposited in the appropriate account. The photocopies of the checks, together with accompanying invoices or other documents, are mailed to the depositor.

II.

The Scheme By Which the Lockbox Operation Was Compromised

The record shows that on five separate occasions, Chemical’s lockbox operation was victimized by individuals employing essentially the same method of operation.

That method involved removing a check from the lockbox department; altering the name of the payee; opening a bank account in the name of the altered payee; depositing the check in that account; and thereafter withdrawing the proceeds.

The method may be illustrated by what happened to the check referred to in count one of the indictment. That check, GX8, was drawn by the Peltz Food Corporation in the amount of $5,131.34, and made payable to “Aicco.” “Aicco” is an acronym for the A-l Credit Corporation, a premium finance company. That is to say, Aicco funds the large insurance premiums of its commercial customers, and then bills its customers for reimbursement (plus commissions) on a monthly basis. Thus Aicco is the sort of Chemical depositor whose business generates large numbers of checks, making it a suitable recipient of lockbox services.

The check in question, as the analysis of the evidence' infra will show, was stolen from the lockbox department. The name of the payee, “Aicco,” was altered so that it read “Aicconetta Winston.” Thereafter an account was opened in the name of “Aicconetta Winston” at the 15 Beaver Street branch of the Seamen’s Bank for Savings, and the Peltz Food Corporation check in question deposited in that account under a forged endorsement in blank reading “Aicconetta Winston.” Thereafter the funds were withdrawn.

The Peltz Food Corporation check referred to in the first count of the indictment, GX8, was dated May 10, 1983. The check described in the second count of the indictment, GX9, dated May 9, 1983, was drawn by Boson Equipment, Inc. to the order of Aicco in the amount of $5,870.84. That check suffered the same fate.

Evidence adduced by defendant shows that the same method of operation was followed both before and after the diversion of the two checks referred to in the indictment. Specifically, on January 10, 1983 the New Haven News Agency, Inc. drew a check in the amount of $4,423.35 to the order of “Dell,” presumably the well-known publishing house, and a Chemical depositor. The name of the payee was altered to “Dellamarva de Hargrove,” and deposited in an account opened under that fictitious name at the Greenpoint Savings Bank in Brooklyn. This check is DXA on the trial.

On June 21, 1983, Labor King Temporaries drew a check, DXC, in the amount of $5,836.11 payable to Aicco. The payee’s name was altered to read “Aiccoriel Ram,” and deposited in an account opened under that name at the Wall Street branch of the Emigrant Savings Bank.

Finally, on July 5, 1983, Top Form Mills, Inc. drew a check, DXB, in the amount of $7,078.88 to the order of Aicco. Again, Aicco’s name was changed to “Aiccoriel Ram” and deposited at the Wall Street branch of Emigrant Savings Bank.

These funds were, in consummation of the scheme, eventually withdrawn from those accounts.

III.

The Employment of Ida Moss at Chemical Bank

The evidence shows that the Aicco check, GX8, was processed in Chemical’s lockbox department on May 12, 1983. The Aicco check, GX9, was processed on May 16, 1983.

At those times, defendant Ida Moss was employed in the lockbox department as a lister and data capture clerk. She worked the second shift in the lockbox department, which operates from 8:00 a.m. to 4:00 p.m. The first shift is from 10:00 p.m. to 6:00 a.m. Ms. Moss was originally sent to Chemical by Office Force, a temporary employment agency. She worked at Chemical approximately a year, leaving Chemical’s employ on July 15, 1983. Chemical’s personnel file, GX27, contains the notation for her leaving: “Not enough money.”

IV.

The Evidence of Defendant’s Involvement With the Two Checks Referred to in the Indictment

The Government offered evidence from witnesses qualified to testify on the subjects of fingerprints and handwriting. I found these witnesses, during their direct and cross-examination, to be forthright and candid. I regard their findings and opinions, as testified to, to be honestly held, and accurate within the limitations of the respective disciplines.

Having said that much, I turn first to the documentary evidence relevant to the opening of the “Aicconetta Winston” account at the Seamen’s Savings Bank, and the subsequent deposits and withdrawals. These transactions had the inevitable consequence of generating pieces of paper.

The Aicconetta Winston account at Seamen’s was opened on May 13, 1983. The person opening an account is required to fill out a new account card giving certain personal information. The new account card in question is in evidence as GX11. Charles Haywood, the Government’s handwriting expert, concluded on the basis of his comparison with the new account card and known exemplars of Moss’s handwriting, that Moss filled out all entries on the new account card except for two initials, presumably those of a teller. I reach the same conclusion on the basis of my own lay examination.

Furthermore, certain of the information furnished on the new account card ties Moss to its subscriber, in a strongly suggestive fashion. The Social Security number put down for “Aicconetta Winston” was identical to that of Ida Moss, except for the change of two numbers of the 9-dig-it series. The year of birth for Aicconetta Winston is the same as defendant’s year of birth. The name of Aicconetta Winston’s equally fictitious father is given as “Nathan Winston”; “Nathan” is the middle name of Moss’s husband. Defendant says all this is coincidence, arguing that these easily avoidable similarities would be so foolish as to be almost exculpatory of defendant. But I think it more plausible to infer that defendant, a relatively unsophisticated individual, confronted with an unexpected need to furnish biographical details on the spot, simply could not improvise that quickly.

In short, the Government has satisfied me beyond a reasonable doubt that defendant executed the Aicconetta Winston new account card at Seamen’s.

At the same time, a $10 cash deposit was made to open the account. That generated a new account deposit slip, GX13. Haywood gave his opinion that the handwriting on the deposit ticket is probably not that of Moss. That is not surprising, since the testimony of John McGloin, a Seamen’s officer, indicated that the new account deposit ticket is customarily filled out by the teller opening the account, and not by the depositor.

However, the Peltz Food Corporation check originally payable to Aicco, GX8, was also deposited into the Aicconetta Winston account at Seamen’s on May 13. Haywood testified, and I accept, that the endorsement on the back of that check, “Aicconetta Winston,” was written by Moss. So was the deposit ticket, GX14, covering that deposit.

Turning to the Boson Equipment, Inc. check, GX9, it was deposited in the Aicconetta Winston account at Seamen’s on May 18, 1983. Haywood testified that the endorsement on that check and the deposit slip executed on that date, GX15, were probably written by the same person; but that that person was probably not Ida Moss.

The situation is different with respect to the three withdrawal slips which evidence the next activity in the Aicconetta Winston account. A withdrawal of $5,000 was made on May 23, 1983; $3,000 was withdrawn on June 1; and $2,800 on June 3. Haywood testified, and I accept, that, with the exception of one or two entries which I do not consider material, these withdrawal slips, GX19, 22 and 23 respectively, were filled out by Ida Moss.

As for fingerprints, no probative evidence emerged. Max Jarrell, an FBI fingerprint expert, examined the checks and other documents generated by the Aicconetta Winston account: GX8, 9, 11, 13, 14, 15, 18, 19, 22 and 23. Latent prints could be detected only on GX14, 15, 22 and 23. The other exhibits yielded no latent prints at all. The prints recovered from the four identified exhibits did not match those of defendant Moss; but I do not regard this as exculpatory in any real sense, owing to the fact (reflected by these very exhibits) that a document can be handled by many people, and yet not yield a single latent print.

It is also worth noting that none of the three other checks deposited to fictitious accounts in other banks, or the documents generated by those accounts, contained handwriting identified as that of defendant Moss. Latent fingerprints were found on some of those documents; they did not belong to Moss. Indeed, Government counsel stipulated on the trial record that Moss “had nothing to do” with the three other checks, or the fictitious accounts through which those checks were cleared.

Y.

Sufficiency of the Government’s Proof Against Ida Moss

The elements expressly derived from 18 U.S.C. § 656, in the context of this case, require the Government to prove beyond a reasonable doubt that Ida Moss, while (1) an employee of (2) a federally insured bank, (3) embezzled, abstracted, purloined or willfully misapplied funds of the bank, or funds intrusted to its custody or care; or that she aided and abetted another in doing so, 18 U.S.C. § 2.

In cases involving bank officers charged with “misapplication” of bank funds, the Second Circuit has in a series of decisions engrafted an additional element upon the offense: that the defendant have the specific intent to injure or defraud the bank. See, e.g., United States v. Clark, 765 F.2d 297 (2d Cir.1985); United States v. Docherty, 468 F.2d 989 (2d Cir.1972); United States v. Iannelli, 461 F.2d 483 (2d Cir.J, cert. denied, 409 U.S. 980, 93 S.Ct. 345, 34 L.Ed.2d 243 (1972); United States v. Fortunato, 402 F.2d 79 (2d Cir.1968), cert. denied, 394 U.S. 933, 89 S.Ct. 1205, 22 L.Ed.2d 463 (1969). Comparable authority is found in other circuits, see, e.g., United States v. Beran, 546 F.2d 1316, 1322 (8th Cir.1976), cert. denied, 430 U.S. 916, 97 S.Ct. 1330, 51 L.Ed.2d 595 (1977).

In the case at bar, there is no doubt that defendant Moss was an employee at Chemical, a federally insured bank, at the time when the two AICCO checks described in the indictment were wrongfully removed from the bank’s care and custody. Defendant’s able counsel disputes none of these elements.

Defendant’s arguments, in summation and subsequent briefs of counsel, were:

(1) Moss’s apparent non-involvement in three of the five checks diverted in this manner showed that someone else was the mastermind of the scheme, and presumably the actual thief.

(2) The only evidence against Moss was that of the handwriting expert in respect of the two Seamen’s Bank deposits, together with the noted biographical similarities on the new account card. Defendant challenges the accuracy of the handwriting expert, and seeks to explain away the similarities.

(3) The Government had not proved that Moss stole the checks from Chemical, or (within the context of aiding and abetting) that she knew someone else had done so.

(4) The Government had not proved the requisite element of intent to injure Chemical economically. That argument was expanded in defendant’s first post trial brief as follows:

“It is clear, then, that to convict a defendant for violating § 656, it must be shown beyond a reasonable doubt that the alleged conduct placed the bank in a position where there was a potential for economic loss. But here the Government’s case involved no evidence of Chemical’s risk of economic loss. Furthermore, the circumstances were such that Chemical in fact was exposed to no risk of economic loss. Seamen’s Bank for Savings accepted the altered checks and therefore it became liable for the losses. UCC §§ 3-405, 3-417, 3-419, 4-207; See generally White & Summers, Handbook on the Uniform Commercial Code §§ 15, 16 (2d Ed.1980). There was no risk to Chemical, no way that the ‘natural result’ of Ida Moss’s alleged conduct could have been to injure or defraud Chemical. Even if Ida Moss knew that the checks came from Chemical, there is no showing that Chemical faced any risk of economic loss.”

As for defendant’s arguments listed under (2), I reject them for the reasons already given. I find that the handwriting expert correctly identified defendant’s handwriting; and that the biographical similarities are incriminatory of Moss, rather than the reverse.

I do accept defense counsel's submission that the Government has not proved, beyond a reasonable doubt, that Moss herself stole the two checks charged in the indictment. Clearly other people were involved in this rather original scheme. There is no reason to suppose that Moss was the only Chemical lockbox employee so involved. The probabilities, in my view, point the other way. In consequence, while it is certain that the checks were stolen, and possible that Moss stole them, it is equally possible that someone else stole them. That proof is not sufficient to brand Moss as the thief.

Hence the Government’s reliance upon that alternative basis of criminal liability: aiding and abetting. If Moss is to be convicted in this case, it must be as an aider and abettor. That implicates the question of knowledge: has the Government proved Moss knew the checks were “embezzled, abstracted, purloined or willfully misapplied” from Chemical Bank?

The proof shows this much: Moss had to know something illicit was going on. She executed the forms necessary to open the Seamen’s Bank account in the fictitious name of “Aieconetta Winston,” using a fictitious personal history for that purpose; and fraudulently endorsed the name “Aicconetta Winston” on the back of the first check listed in the indictment. The only reasonable inference I can draw is that Moss knew this check was stolen.

But did she know it was stolen from the custody or care of Chemical Bank? I accept Mr. Joy’s submission that such knowledge is necessary to sustain a conviction under § 656 and the indictment as drawn. But I conclude that the Government’s evidence is sufficient.

I would perhaps take a different view if Moss had not been an employee of the Chemical lockbox department at the time these checks were diverted, altered, deposited and then withdrawn. In those hypothetical circumstances, defense counsel could argue with more force that such an individual, while assisting another in a clearly suspect scheme, had not been shown to know the source of the altered checks.

But Moss, employed by Chemical’s lock-box department for about a year when she left in July 1983, had accordingly been so employed for nine months prior to the diversion of the checks in question. She was a “lister” and a “data capture clerk.” Those activities are clarified by the testimony of George Sandoval, the Chemical officer in charge of the department:

Q. Tell the court what the Chemical Bank lockbox department does with checks that are remitted to it on behalf of its customers.
A. Well, we pick them up at the post office daily. It is then delivered to the lockbox department where we have what we call mail extractors. The mail extractors are then responsible for pulling out the check and bill out of the envelope. While pulling the checks and documents, they are making a batch of checks and a batch of documents.
Subsequent to that they batch the documents in one group, the checks in another. The documents or what I call bills stay with them. Checks go to what we call the work flow coordinator. The work flow coordinator then delivers these checks to what we call a photocopy room. Each and every check is photocopied, the checks are banded again, the' photocopies are banded again and returned to the work flow coordinator. The work flow coordinator then reviews each check for negotiability, basically making sure that the documents and signatures are in order and they are not postdated or stale dated. Once that is complete, they will take the photocopies and checks to what we call a lister. The lister is then responsible for listing the dollar amount from each photocopy and creating what we call a listing tape. The listing tape is then banded to the photocopies as well as the checks, and then delivered or picked up by another work flow coordinator who brings it to a data entry station.
The data entry station area is then responsible for keying in the check amount, and they are responsible for keying in the check amount and making sure that the checks prove back to the listing. All that data is fed into a computer where it is maintained. The photocopies go back to the mail personnel or the extractor where he staples the photocopy to a corresponding envelope and bill and sends it back out to the customer.
Q. Now, you said that after they go to the photocopy area they go to a lister; is that correct?
A. After they go to the photocopy area they go back to the work flow coordinator, then the lister.
Q. And then to the lister, and from the lister you said that they go to the data capture area or the data entry area? A. That’s correct.
Q. What relationship if any is there between the individuals who work as listers and the individuals who work in the data entry area?
A. Basically they are interchangeable. One works as a data capture and simultaneously works — and on occasion works as a lister as well.
Q. How is it decided who will work as a lister on any particular day?
A. Normally either the work floor coordinator or the supervisor will select somebody at the beginning of the day. Tr. 23-24, 26.

I find that when defendant Moss fraudulently endorsed the Peltz Food Corporation check payable to the order of “Aicco” and altered to “Aicconetta Winston,” she knew she was dealing with a check payable to a Chemical depositor, namely Aicco, which had been improperly removed from the bank. I base that finding on three factors:

(a) Moss had been processing the checks of Chemical lockbox depositors long enough to become familiar with their names. I appreciate the force of Mr. Joy’s argument that Moss’s responsibilities focused upon preparation of lists of numbers, or the feeding of numbers into a computer. I accept his characterization, as did Mr. Sandoval in cross-examination, that this is a repetitive, “mind-numbing job.” Nevertheless, the lister has before her the entire check or its photocopy when she prepares her lists; Aicco used Chemical’s lockbox service precisely because its business generated large quantities of checks; and it is not fanciful to suppose that, over time, an employee such as Moss picks up and retains the names of depositor-payees, even by a sort of visual, subliminal osmosis.

(b) As the checks work their way through the system described by Sandoval, pencilled notations are made on them. Such a notation appears on this check. Moss would have been familiar with it.

(c) For the reasons stated, it is more likely that at least one other Chemical employee was involved in the scheme. Accepting that the Government has not proved that Moss stole the checks herself, I infer from the evidence that she aided and abetted another Chemical lockbox employee, which implies discussions between them about what they were doing; and that they were each well aware of the source of the checks.

I do not regard this finding of knowledge as impermissibly speculative. It seems to me a fair inference to draw from all the evidence; and to establish knowledge on the part of Moss beyond a reasonable doubt.

What I have just said disposes of a subsidiary argument made on behalf of defendant with respect to the second check identified in count two of the indictment. That is the Boson Equipment Incorporated check in the amount of $5,870.84, also payable to Aicco. That check was deposited in the “Aicconetta Winston” account at Seamen’s Bank on May 18, 1983. As noted, the Government’s handwriting expert has concluded that the endorsement on that check and the deposit slip were probably written by the same person; but that that person was probably not defendant Moss. From this, Moss argues that there is no evidence connecting her with the check referred to in the second count of the indictment.

I do not agree. This particular evidence does no more than confirm what we already knew: that someone else besides Moss was involved in the scheme. However, Moss again appears on the scene, through the testimony of the handwriting expert, when, on May 23, June 1, and June 3, 1983, by means of three separate withdrawal slips, all the money was taken out of the Aieconetta Winston account with the exception of a few hundred dollars. Moss executed each withdrawal slip. That is to say: while Moss did not make one of the deposits, she made all the withdrawals. I may reasonably infer that, from the total amount of the withdrawals, Moss knew that an additional, fraudulent deposit had been made into this fraudulent account; and that another stolen Aicco was used for the purpose. That is sufficient evidence to impute the requisite knowledge to Moss, as an aider and abettor, on both counts.

The last issue is that of intent: an element which I asked counsel to brief particularly.

The requisite intent underlying a § 656 violation, whatever that intent may be, must be shown by the Government even on an aiding and abetting theory. As stated in United States v. Docherty, supra:

“A violation of 18 U.S.C. § 656 requires, so far as here relevant, a situation where a bank officer, director, agent or employee ‘embezzles, abstracts, purloins or willfully misapplies any of the moneys, funds or credits of such bank____” When a defendant is charged simply as an aider or abettor, submission to the jury is warranted only if there is enough evidence to show that he knew of such activity of the principal and desired to forward it.”
468 F.2d at 992 (emphasis added).

The line of Second Circuit authority including Docherty and ending (for the present) with United States v. Clark, supra, all deal with (1) bank officers who are charged with (2) willful misapplication of bank funds. In that particular context, the Second Circuit has said that “intent to injure or defraud the bank” is a “basic element of the crime,” United States v. Fortunato, supra, at 402 F.2d 80. In Clark the court concluded:

“...to constitute ‘misapplication’ within the meaning of the statute the bank officer’s conduct must involve some risk of pecuniary loss to the bank, not simply the violation of a rule or policy not designed to protect the bank’s assets against loss.”

The Second Circuit’s approach to these cases was shaped by Judge Friendly’s analysis in Docherty. Judge Friendly pointed out that the predecessor to § 656:

“...expressly made intent ‘to injure .or defraud’ the bank an essential element of the crime of misapplication but that these words were eliminated when the statute was revised and shortened in 1948, with the Reviser stating that the revision did not change ‘in any way the meaning or substance of existing law.’ Prior to that time it was clear that proof of some intention to injure or defraud the bank was essential and that an officer’s maladministration of the bank by violating its rules without such an intent would not contravene the statute. See United States v. Britton, 107 U.S. 655, 667, 17 Otto 655, 2 S.Ct. 512, 522, 27 L.Ed. 520 (1883).”
United States v. Clark, 765 F.2d at 302.

A bank officer’s “application” of his bank’s funds may be subject to more than one interpretation. The bank officer may show bad judgment, for which a reprimand may await him in the executive suite; and yet fall short of that “willful misapplication” constituting a felony under § 656. Docherty furnishes an example. There, the bank officer approved loans to an individual who immediately turned them back to the officer as the true recipient. The requisite “intent to injure or defraud the bank” was not present because the nominal borrower was solvent and had not misrepresented the purpose of the loan in his application. In Clark, by contrast, the bank officer approved loans to the individuals in excess of bank limitations, thereby exposing the bank to that increased risk of loss which, in the Second Circuit’s view, satisfied the element of intent. 765 F.2d at 303.

Defendant Moss was not a bank officer. She was an employee. Her actions cannot possibly be viewed in an innocent light. I conclude that in this case, the Government need not prove a specific “intent to injure or defraud” Chemical Bank, in the sense of subjecting it to increased economic risk. I base that conclusion on two reasons.

First, the crime proved at trial may fairly be characterized as “embezzlement”: one of the four crimes embraced by § 656. They constitute “possible theories of violation of the statute,” Fortunato, supra, at 80 (per Feinberg, Ct.J.) (emphasis added). See also 80 n. 2.

Furthermore, these possible theories of violation may contain different elements. In United States v. Sayklay, 542 F.2d 942 (5th Cir.1976), the Government alleged only embezzlement in violation of § 656. The conviction was reversed because, while the evidence proved willful misapplication of bank funds, it did not prove embezzlement. See also United States v. Holmes, 611 F.2d 329, 331 (10th Cir.1979):

“Embezzlement is ‘the fraudulent appropriation of property by a person to whom such property has been entrusted, or into whose hands it had lawfully become.’ ... Misapplication covers acts not covered by embezzlement.”

Two circuits have held that, in charging juries in embezzlement cases, the court need not specifically charge that it must find a specific intent to injure or defraud a bank. It is sufficient to charge that the defendant committed acts that he knew the law forbade, and that he intended to break the law. United States v. Scheper, 520 F.2d 1355, 1357-58 (4th Cir.1975); United States v. Johnson, 447 F.2d 31, 34 (7th Cir.1971).

I hold that there is sufficient evidence in this case to establish Moss’s criminal intent to aid and abet others in the crime of embezzlement under § 656.

However, assuming that the Government must prove specific intent to injure or defraud the bank, either because this must be regarded as a “misapplication” case, or because the element applies to all four crimes embraced by § 656, I hold that the evidence is sufficient.

I do not find at all appealing Mr. Joy's submission that this intent cannot exist in law because, under the Uniform Commercial Code, the economic loss will fall upon Seamen’s Bank and not upon Chemical Bank. In point of fact, the question of who reimbursed whom for these checks and when is not resolved by the evidence at trial. But assuming that counsel is correct in the ultimate resolution he suggests under the UCC, I decline to apply that salutary body of commercial legislation to relieve a faithless bank employee such as defendant from the consequences of her actions, even if I were to indulge the fanciful assumption that she researched the UCC before acting.

Furthermore, the argument based on the UCC relates only to whether the Chemical Bank will be actually out of pocket; that is to say, suffer economic injury. But the intent with which we are concerned is “to injure or defraud” the bank; and those concepts are not the same. In United States v. Angelos, 763 F.2d 859 (1985), the Seventh Circuit dealt with a bank officer named Angelos who made unauthorized loans to himself. He appealed from his conviction on the ground that the requisite intent under § 656 had not been shown. The Seventh Circuit rejected the argument:

“Moreover, it is important to distinguish between intent to injure and intent to defraud; either will do, and they are not the same. By lending the bank’s money in effect to himself in violation of accepted banking procedures, Angelos breached his fiduciary obligation to the bank, and it is irrelevant whether he thought, and thought correctly, that the bank would not be hurt. Intent to defraud— which means, to take financial advantage of a confidential relationship, as we noted recently in United States v. Dial, 757 F.2d 163, 168 (7th Cir.1985) — is all that is required to make out a violation of section 656; intent to injure the bank need not be shown.”
763 F.2d at 861-62.

This analysis in Angelos is consistent with a line of cases holding that the breach of a bank employee’s fiduciary duty, in reckless disregard of the bank’s interest, is sufficient to establish the requisite intent to defraud. United States v. Cyr, 712 F.2d 729, 732 (1st Cir.1983); United States v. Krepps, 605 F.2d 101, 104 (3rd Cir.1979); United States v. Welliver, 601 F.2d 203, 210 (5th Cir.1979); United States v. Franklin, 608 F.2d 241, 244 (6th Cir.1979); United States v. Larson, 581 F.2d 664, 667 (7th Cir.1978).

In the case at bar, I conclude that defendant Ida Moss, at the time she was an employee of Chemical Bank’s lockbox department, aided and abetted others with knowledge, and with the requisite specific intent to defraud the bank by a course of conduct in breach of fiduciary responsibilities and in reckless disregard of the bank’s interest, exposing it to inconvenience, embarrassment and claims (which the trial evidence reveals actually occurred). That is sufficient, whether or not economic injury resulted.

Conclusion

It follows that I convict defendant Ida Moss on both counts of this indictment.

I will require a presentence report on defendant Moss.

I will sentence her on March 19, 1986 at 4:30 p.m. in Courtroom 307.

It is SO ORDERED.


source: Caselaw Access Project

author: FLANNERY, District Judge.

license: Public Domain

text:
    Paul NEWMAN, et al., Plaintiffs, v. LEGAL SERVICES CORPORATION, et al., Defendants.
    Civ. A. No. 84-3345.
    United States District Court, District of Columbia.
    Jan. 27, 1986.

      Lisa B. Rovin, Marc Efron, Rochelle M. Gunner, Ridgway M. Hall, Jr., Crowell & Moring, Washington, D.C., for plaintiffs.
    Jacob A. Stein, Robert F. Muse, Stein, Mitchell & Mezines, Washington, D.C., for defendant Potack.
    D. Clifford Crook, III, Asst. Gen. Counsel, and Robert T. Thompson, John P. Mann, Harold P. Coxson, Dannie B. Fogleman, Thompson, Mann & Hutson, Washington, D.C., for defendant Legal Services.
    Griffin B. Bell, James Miller, King & Spaulding, Washington, D.C., for defendant Bogard.
   MEMORANDUM

FLANNERY, District Judge.

This matter is before the court on defendants’ motions for summary judgment.

I. Background

Plaintiff Newman was the regional director of Legal Services Corporation’s (hereinafter “LSC”) Denver regional office and Plaintiff Gilbert was regional director of LSC’s Boston regional office. On August 10, 1984, Defendant Potack, LSC’s President fired both plaintiffs.

Defendants in the case are the Legal Services Corporation; and Donald P. Bogard, LSC’s President arid Gene Potack LSC's Director of Office of Field Services at the time plaintiffs were fired. The Legal Service Corporation Act provides that neither the LSC nor its employees (with certain exceptions not relevant in this case) are to be deemed part of the federal government. 42 U.S.C. § 2996d(e)(l). However, all of LSC’s funding is from the federal government, it publishes its regulations in the Code of Federal Regulations, and it is subject to FOIA.

Plaintiffs have alleged four types of claims against defendants. First, plaintiffs contend that they were wrongfully terminated in violation of their employment contract and in violation of public policy. Second, plaintiffs claim that their terminations violate the First and Fifth Amendments of the United States Constitution. Third, plaintiffs claim that defendants defamed them in their testimony to a Congressional committee and by sending a copy of that testimony to someone under FOIA, in statements allegedly made to LSC employees and directors, and in a letter to the Massachusetts Bar Association. Finally, plaintiffs complain of intentional infliction of emotional distress based on defendants allegedly outrageous conduct of preventing plaintiffs from communicating with coworkers and from keeping plaintiffs from immediately removing their personal belongings from their offices.

Defendants contend, first, that plaintiffs had no employment contracts and thus were at-will employees who could be dismissed for any reason at any time. Second, defendants argue that they are not federal or state actors and, therefore, cannot be sued for alleged constitutional violations. Third, defendants state that their communications to Congress are absolutely privileged from suit and that communications within LSC are qualifiedly immune. Finally, defendants argue that they did not act outrageously, and as a matter of law, cannot be liable to plaintiffs for intentional infliction of emotional distress. Defendants have moved for summary judgment on all plaintiffs’ claims.

II. Discussion

At the outset, it must be noted that there is a potential conflict of laws issue in this case. LSC is a District of Columbia corporation and, at the time of their firings, plaintiff Newman was a Massachusetts resident and plaintiff Gilbert was a Colorado resident. However, the case law of the three jurisdictions on the non-federal issues involved in the motions for summary judgment is not in conflict, and the parties do not raise choice of law as an issue for purposes of this motion. Thus, the court will apply District of Columbia law to the nonfederal issues involved in this case.

A. Wrongful Termination Claims

The individual defendants, Potack and Bogard, argue that they cannot be held personally liable to plaintiffs for violation of their employment contracts. Rather, Potack and Bogard argue that only LSC can be liable since LSC was plaintiffs’ employer, not them. Since plaintiffs do not allege that they had an employment contract with either individual defendant, summary judgment is granted to individual defendants on plaintiffs’ violation of employment contract claim.

The next set of questions the court must address is whether plaintiffs were at-will employees, and if so, whether there is a public policy exception to the at-will employment doctrine in this jurisdiction.

Plaintiffs contend that they had an employment contract with defendant LSC. While plaintiffs admit that there is no single document regarding their employment entitled “employment contract”, they argue that LSC’s written offer (Plaintiffs Appendix, Tab 1), each plaintiff’s written acceptance {Id. at Tab 2), and the LSC Personnel Procedures Manual (Id. at Tab 3) constitute an employment contract.

That argument is not well taken. As this court has stated, an employment contract is terminable at will unless it is for a specified term. Prouty v. Nat’l Passenger R.R. Corp., 572 F.Supp. 200, 204 (D.D.C.1983) (June Green, J.). None of the documents plaintiffs rely on contain a specified term of employment. Moreover, the LSC Act specifically provides that the President of LSC may terminate employees at will. 42 U.S.C. 2996d(b)(1) (1982). Thus, this court holds that plaintiffs were at-will employees.

Having decided that plaintiffs were at-will employees, the court must now consider whether this jurisdiction would recognize a public policy exception to the at-will employment doctrine.

In Ivy v. Army Times Publishing Co., 428 A.2d 831 (D.C.Ct.App.1981), the court denied a petition for rehearing en banc a panel decision which held that there was no public policy exception in the District. However, there was no majority opinion, and four judges dissented from the decision not to grant rehearing en banc. A dissent in which three of the dissenting justices fully joined, indicates with convincing force that the District would recognize a public policy exception to the at-will employment doctrine.

The general rule in the District of Columbia is that an at-will employee may be terminated for any reason — right or wrong — or for no reason at all. See Taylor v. Greenway Restaurant, Inc., 173 A.2d 211 (D.C.Mun.App.1961). And that rule had been the rule in most, if not all, American jurisdictions.

On the federal level, the at-will employment rule was modified by the enactment of labor relations legislation, see NLRB v. Jones & Laughlin Steel Corp., 301 U.S. 1, 57 S.Ct. 615, 81 L.Ed. 893 (1937). Similarly, many states have recognized the need to control an employer’s right to discharge employees who are not parties to a collective bargaining agreement. Those states have recognized a so-called “public policy” exception to the at-will employment doctrine.

The landmark state case was Petermann v. Int’l Brotherhood of Teamsters, 174 Cal.App.2d 184, 344 P.2d 25 (1959). In Petermann, an at-will employee was fired for refusing to commit perjury at a legislative hearing. The court held that the employer’s conduct violated the state’s declared public policy of encouraging truthful testimony. In the wake of Petermann, many states have adopted a “public policy” exception. Only two states, Florida and Alabama, have refused to recognize the exception. See Martin v. Tapley, 360 So.2d 708 (Ala.1978); Segal v. Arrow Industrial Corp., 364 So.2d 89 (Fl.Ct.App.1978).

Granted, terminated employees should not be allowed to haul their employers into court and require them to assert a good reason for the employee’s termination. An employer has the right to hire and fire who he will. Thus, courts, in cases like Monge v. Beebe Rubber Co., 114 N.H. 130, 316 A.2d 549 (1974), have balanced the employee’s interest in maintaining employment, the employer’s interest in running a business, and the public interest. Other courts have held that they will recognize the exception only where a clear mandate of public policy is involved. See, e.g., Percival v. General Motors Co., 400 F.Supp. 1322 (E.D.Mo.1975), aff'd 539 F.2d 1126 (8th Cir.1976). Perhaps the most lucid statement and analysis of the clear mandate test came in Pierce v. Ortho Pharmaceutical Corp., 84 N.J. 58, 417 A.2d 505 (N.J.1980). There the court stated:

We hold that an employee has a cause of action for wrongful discharge when the discharge is contrary to a clear mandate of public policy. The sources of public policy include legislation; administrative rules, regulations or decisions; and judicial decisions____ Absent legislation, the judiciary must define the cause of action in case-by-case determinations. An employer’s right to discharge an employee at will carries a correlative duty not to discharge an employee who declines to perform an act that would require a violation of a clear mandate of public policy. However, unless an employee at will identifies a specific expression of public policy, he may be discharged with or without cause.

Id., 417 A.2d at 512.

This court holds that the District of Columbia would recognize a public policy exception to the at-will employment doctrine consistent with the Supreme Court of New Jersey’s decision in Pierce. The District has long recognized a public policy exception to a landlord’s right to evict a tenant-at-will. Edwards v. Habib, 397 F.2d 687 (D.C.Cir.1968), cert. denied, 393 U.S. 1016, 89 S.Ct. 618, 21 L.Ed.2d 560 (1969). The right to employment is as fundamental a right as the right to housing. Thus, this court holds that the District of Columbia would recognize a public policy exception to the at-will employment doctrine.

Having concluded that such an exception would be recognized for violations of clear mandates of public policy, the court next examines whether such a clear mandate of public policy exists as a matter of law in this case.

Plaintiffs argue that their terminations violated public policy in three ways. First, plaintiffs state that they were terminated “because defendants perceived them to be ideologically opposed to defendants’ notions of delivery of legal services to the poor.” (Plaintiffs’ Rule 1 — 9(i) Statement at 7). Second, plaintiffs contend that they were terminated “for exercising constitutional rights to freedom of speech and association and to petition the government. (Id.). Finally, plaintiffs claim that they were terminated for informing defendants of violations of the LSC Act. (Id. at 8). This memorandum will now address each of those claims.

The court holds that there is no clear mandate of public policy which prevents an employer from terminating an employee who disagrees with the organizational or managerial ideology of his or her employer. For one, plaintiffs have not pointed to a source which states such a policy. The only possible source is a provision of the LSC Act which requires that there be no political test or qualification for employment with LSC. 42 U.S.C. § 2996e(b)(2) (1982). However, that provision speaks in terms of political party differences between an LSC employee and the LSC. It says nothing about ideological differences concerning how the corporation should conduct its business. Moreover, an employer has a strong interest in assuring that employees follow the employer’s policies and managerial ideology. And so the courts recognizing the public policy exception have held. See, e.g., Percival v. General Motors Corp., 400 F.Supp. 1322 (E.D.Mo.1975), aff'd 539 F.2d 1126 (8th Cir.1976); Trombetta v. Detroit, Toledo & Ironton R. Co., 81 Mich.App. 489, 265 N.W.2d 384 (Ct.App.1978); Lampe v. Presbyterian Medical Center, 41 Colo.App. 465, 590 P.2d 513 (1979). As stated by the New Jersey Supreme Court in Pierce: “In evaluating claims for wrongful discharge, courts have been careful not to interfere with the employer’s right to make business decisions and to choose the best personnel for the job.” 417 A.2d 510-511.

Similarly, the court holds that plaintiff’s second identified violation of public policy is not actionable. Plaintiffs claim that they were terminated for exercising their First Amendment rights. There is one overriding problem with plaintiffs’ identification of the First Amendment as a clear mandate of public policy in this case: By its own terms, the First Amendment applies only to federal or state governmental actors. If LSC is held not to be a state actor {see discussion infra), the First Amendment could not serve as a clear source of public policy constraining LSC. If, on the other hand, LSC is held to be a state actor, plaintiffs’ remedy for violations of the First Amendment lie in an action for constitutional violation, not for wrongful termination. See Mt. Healthy v. Doyle, 429 U.S. 274, 97 S.Ct. 568, 50 L.Ed.2d 471 (1977). Since plaintiffs make such a claim, it will be discussed below.

Finally, the court rejects plaintiffs’ third claimed mandate of public policy. Plaintiffs claim that they were fired for informing their superiors of violations of the LSC Act. Plaintiff Newman specifically claims that he was fired for informing defendants that they were not properly monitoring LSC grant recipients. (Plaintiffs’ Memo in Opposition at 16-17). Plaintiff Newman points to alleged unreasonable travel restrictions and understaffing as evidence of LSC’s failure to monitor. Plaintiff Gilbert specifically claims he was terminated for sending two staff members to investigate an alleged violation of the LSC Act in Laredo, Texas.

While plaintiffs cite specific sections of the LSC Act which provide that LSC must monitor grant recipients and investigate alleged violations, those sections are not clear mandates of public policy. Those sections only mandate that LSC monitor and investigate; those sections do not mandate how LSC should carry out its monitoring and investigatory functions. Plaintiffs’ complaints focus around their disagreement with LSC over how to monitor recipients and how to investigate violations. In essence, the controversy involved a difference of professional opinions. Courts recognizing the public policy exception to the at-will employment doctrine have consistently held that such disagreements are not actionable violations of public policy. See, e.g., Pierce, 417 A.2d at 513-514; Lampe, 590 P.2d at 515-517.

For those reasons, the court grants defendants’ motion for summary judgment on plaintiffs’ claims alleging that they were terminated in violation of public policy.

The final part of plaintiffs’ wrongful termination claims is against the individual defendants. Plaintiffs allege that Potack and Bogard intentionally interfered with plaintiffs’ employment contract with LSC. The individual defendants have moved for summary judgment on that claim arguing that they cannot be held liable for intentional interference because that cause of action requires the intervention of a third party.

Defendants’ argument accurately states the law in this jurisdiction. In Donohoe v. Watt, 546 F.Supp. 753 (D.D.C.1982) , aff'd without opinion, 713 F.2d 864 (D.C.Cir.1983), a discharged employee sued the president of his former employer and alleged that the president tortiously interfered with plaintiff’s employment. The court (Jackson, J.) granted summary judgment to the president, stating, “[i]t is a well settled principle of law that this tort arises only when there is interference with a contract between the plaintiff and a third party.” 546 F.Supp. at 757. A corporate officer is not a third-party to a contract between his corporation and one of its employees. Thus, summary judgment is granted to individual defendants on plaintiffs’ claim of intentional interference.

B. Constitional Law Claims

Defendants are only liable for constitutional violations if they are federal or state actors. Thus, the court must determine whether any, all or none of the defendants are federal or state actors before it can address plaintiffs’ constitutional law claims.

LSC is a corporation which was established by the federal government and which receives all its funding from the federal government. LSC has the power to promulgate regulations which must be published in the Federal Register, LSC is subject to the Freedom of Information Act, see 42 U.S.C. § 2996d(g), and LSC is prohibited from terminating recipients of its funds without providing notice and an opportunity for a hearing before a hearing examiner, see 42 U.S.C. § 2996j. However, Congress has specifically provided that LSC’s officers and employees shall not be considered officers and employees of the Federal Government. 42 U.S.C. § 2996d(e)(1).

While there are several cases cited by defendants which hold that local legal service organizations funded by LSC are not federal actors, see, e.g., Gerena v. Puerto Rico Legal Services, Inc., 538 F.Supp. 754 (D.P.R.1982), aff'd, 697 F.2d 447 (1st Cir.1983) , only one has specifically addressed whether LSC itself is a federal actor. In Eligible Residents of Garfield-Austin v. Legal Assistance Foundation, Civ. No. 82-C-1007 (N.D.Ill. May 24, 1982, unpublished, see Plaintiffs’ Appendix at Tab 14), the court held that LSC was a federal actor. That case, unfortunately, was decided one-month prior to three recent Supreme Court decisions which set forth the tests for finding state or federal action. Therefore, this court rejects the holding in the Eligible Residents decision and, instead, applies the tests and standards set forth in the recent Supreme Court decisions.

. On June 25, 1982, the Supreme Court decided three cases involving the state action requirement: Lugar v. Edmondson Oil Co., Inc., 457 U.S. 922, 102 S.Ct. 2744, 73 L.Ed.2d 482 (1982); Rendell-Baker v. Kohn, 457 U.S. 830, 102 S.Ct. 2764, 73 L.Ed.2d 418 (1982); and Blum v. Yaretsky, 457 U.S. 991, 102 S.Ct. 2777, 102 S.Ct. 2777, 73 L.Ed.2d 534 (1982). In Lugar the Court set forth a two-part test to be used in deciding whether an entity is a federal or state actor. First, the alleged constitutional deprivation must be caused by the exercise of some right or privilege created by the governmental actor or by a rule of conduct imposed by the government. Second, the party charged with the deprivation must be a person who may fairly be said to be a state actor. 457 U.S. at 937, 102 S.Ct. at 2753-2754.

Rendell-Baker, the second of the Supreme Court’s June 25, 1982, trilogy of state action cases, is the decision that dealt with facts most identical to the facts of the case at hand. In Rendell-Baker, the named petitioner sued her former employer, the New Perspectives School, and New Perspectives’ director, Sandra Kohn. Plaintiff claimed she had been terminated for exercising her First Amendment rights by supporting a student petition. The School, although privately owned, received almost all of its funding from the state, and petitioner Rendell-Baker’s position was funded by a grant from the federal Law Enforcement Assistance Administration distributed from a state committee. As a condition of the grant, the committee had the right to ápprove or disapprove of the school’s initial hiring decisions. Because of these factors, petitioners claimed that the school and its director were state actors.

In its decision, the Supreme Court concluded that neither the school nor its director were state actors. The court held that neither the fact that virtually all the school’s income was from governmental sources nor the fact that the initial hiring decision was subject to state regulation, nor that the school was carrying out a “public function”, justified a holding finding state action.

In reaching that conclusion, the court cited a particularly relevant case to the facts of the present case, Polk County v. Dodson, 454 U.S. 312, 102 S.Ct. 445, 70 L.Ed.2d 509 (1981). In Polk County, the Court held that a public defender, although an employee of the state, was not a state actor because “a public defender is not amenable to administrative direction in the same sense as other employees of the State” and because of the state’s obligation “to respect the professional independence of the public defenders whom it engages.” 454 U.S. at 321, 102 S.Ct. at 451.

Application of these legal principles to the undisputed facts of this case, compels a holding that neither LSC nor the individual defendants here are governmental actors. As in Rendell-Baker, there is no indication or allegation that the decisions to fire plaintiffs were compelled or even influenced by federal governmental regulation. As mentioned above, the president of LSC has the power to terminate employees, a power which is not subject to any federal governmental regulation. See 2996d(b)(l). Furthermore, the legislative history of the LSC Act indicates that LSC was formed for the very reason that it should have independence from federal government regulation. See H.R.Rep. No. 247, 93d Cong., 1st Sess. (1973), reprinted in 1974 U.S.Code Cong. & Adm.News 3872, 3873. For those reasons, the court holds that defendants are not federal actors and should grant defendants’ motions for summary judgment on plaintiff’s constitutional law claims.

C. Defamation Claims

Plaintiffs first claim that defendants defamed them in a submission to a subcommittee of the House Judiciary Committee. By letter dated September 14, 1984, Rep. Kastenmeier requested the following material “in preparation for the hearing”:

A copy of any written materials relating to the terminations of Messrs. Newman and Gilbert, including but not limited to: (a) memoranda, if any, of Potack or any other corporation employee or officer to the personnel officer prior to or subsequent to the terminations; (b) any personnel action form or termination form related to the termination; (c) a detailed explanation of the specific facts, activites or events which form the basis of the terminations [footnote omitted]; and (d) any other information relevant to the reason for the terminations.

Pl.Ex. 14.

The law is well established in this circuit that testimony and statements are absolutely privileged when presented to legislative proceedings at the express request of those conducting such hearings. Webster v. Sun Co., Inc., 731 F.2d 1 (D.C.Cir.1984). However, the Court did state in footnote 9 that: “This privilege insulates statements made only to the legislature or its investigative arm. Publication to individuals not associated with the legislature and republication by the legislator are not covered by this privilege,” Thus, the court must determine whether dissemination of the statement pursuant to the Freedom of Information Act (FOIA) was privileged.

FOIA provides:

“... each agency upon any request for records which (A) reasonably describes the records and (B) is made in accordance with published rules stating the time, place, fees (if any), and procedures to be followed, shall make the records promptly available to any person.

5 U.S.C. § 552(a)(3) (1982).

Thus, a person need not title a request for government documents a “FOIA request”. Absent an applicable exception, the government must provide the requested documents. Because defendants were required to produce the document, that production maintains absolute immunity-

As to plaintiffs’ other defamation claims, summary judgment is inappropriate at this time. There is a dispute as to one of the alleged statements as to whether it was actually said or merely inferred from defendants’ conduct; and plaintiffs are correct to note that even if some intra-corporate communications are conditionally privileged, a condition of that privilege is that the statements not be made with ill-will, an issue of fact. See, e.g., Arsenault v. Allegheny Airlines, Inc., 485 F.Supp. 1373, 1379 (D.Mass.), aff'd without opinion, 636 F.2d 1199 (1st Cir.1980), cert. denied, 454 U.S. 821, 102 S.Ct. 105, 70 L.Ed.2d 93 (1981). Plaintiffs have also alleged other instances of defamation which defendants did not address in their initial motion for summary judgment. See Plaintiffs’ Opposition to Defendant Legal Service’s Motion for Summary Judgment at 25-26. Those allegations present questions of fact as to whether each of the statements were made. Thus, summary judgment is not granted to defendants on those issues.

D. Emotional Distress Claims

Defendants argue that plaintiffs’ sole remedy for emotional distress is under the Federal Employment Compensation Act (FECA). That statute provides that "... the liability of the United States or an instrumentality thereof under this subchapter or any extension thereof with respect to the injury or death of an employee is exclusive ...”. 5 U.S.C. § 8116(c) (1982). “Injury” is defined as including “... in addition to injury by accident, a disease proximately caused by the employment, and damage to or destruction of medical braces, artificial limbs, and other prosthetic devices ...”. 5 U.S.C. § 8101(5) (1982).

A claim for emotional distress clearly appears not to be an injury covered under FECA and therefore, FECA does not provide the exclusive remedy for emotional distress. See Sullivan v. United States, 428 F.Supp. 79, 81 (E.D.Wis.1977); DeFord v. Secretary of Labor, 700 F.2d 281, 290 (6th Cir.1983).

In Sere v. Group Hospital Inc., 443 A.2d 33, 37 (D.C.Ct.App.1982), the District of Columbia Court of Appeals set out the three elements of the tort of intentional infliction of emotional distress: 1) extreme and outrageous conduct by defendant which 2) intentionally or recklessly 3) causes the plaintiff severe emotional distress. Defendants contend that their conduct was neither extreme and outrageous nor did plaintiffs suffer any emotional distress, and that therefore, summary judgment must be granted in their favor. Plaintiffs counter that defendants’ conduct was extreme and outrageous and that it caused them distress.

It is true that, “in the first instance, whether the defendant’s conduct may reasonably be regarded as so extreme and outrageous as to permit recovery” is for the court to determine. Sere, 443 A.2d at 38. Examining the facts in this case in such a light, it appears that summary judgment is appropriate. There has been no evidence of sufficient severity of the distress to state a claim under the Sere test. The court also notes that there is grave doubt whether defendants’ alleged conduct was extreme and outrageous, although the court does not decide defendants’ motion on that ground.

An appropriate Order accompanies this Memorandum.

ORDER

This matter came before the court on defendants’ motions for summary judgment. For reasons stated in the accompanying Memorandum filed this day, it is, by the court, this 27th day of January, 1986,

ORDERED that defendants’ motions for summary judgment are granted in all respects except as to plaintiffs’ claims for defamation not based on the statement submitted to Congress and subsequently released under FOIA.

      . Indeed, there is even less of an indication of governmental influence over the employment decision here than there was in Rendell-Baker. In Rendell-Baker the governmental actor had the authority to approve of the initial hiring decision of the plaintiff. See 457 U.S. at 833, 102 S.Ct. at 2767. Despite this governmental influence over the hiring decision, the Supreme Court held that because the government had nothing to do with the decision to terminate Ms. Rendell-Baker, there was no state action in that decision. 457 U.S. at 841-42; 102 S.Ct. at 2771-2772.


author: HATFIELD, District Judge.

text:
    Pamela Keller McNABB, as Guardian Ad Litem for James McNABB, a minor person, Plaintiff, v. Margaret HECKLER, Secretary of the Department of Health and Human Services, her agents, employees and successors; Everett R. Rhodes, M.D., Director of Indian Health Service; the United States Department of Health and Human Services; and the United States Government, and J.T. Brownlee, as Director of Roosevelt County Department of Public Welfare, his agents, employees and successors; the Roosevelt County Department of Public Welfare; James Halvorson, Al Harvey, and Al Kashubein, as County Commissioners of Roosevelt County; the Roosevelt County Board of Commissioners; and Roosevelt County, Defendants.
    No. CV-83-051-GF.
    United States District Court, D. Montana, Great Falls Division.
    Jan. 27, 1986.
    Steven L. Bunch, Montana Legal Services, Helena, Mont., for plaintiff.
    Carl E. Rostad, Asst. U.S. Atty., Great Falls, Mont., James McCann, Co. Atty., Roosevelt County, Wolf Point, Mont., for defendants.
    Richard A. Weber, Jr., Hamilton, Mont., Dave Rice, Havre, Mont., for amicus curiae.
   HATFIELD, District Judge.

On December 4, 1981, Pamela Keller McNabb, the non-Indian, common law wife of Raymond McNabb, a Chippewa-Cree Indian, gave birth to James McNabb. At the time of James’ birth, which was eight weeks premature, and at the time this action was filed, Pamela and Raymond McNabb resided on the Fort Peck Indian Reservation. Pamela McNabb has applied with both the Indian Health Service (“IHS”) and Roosevelt County for payment of the medical bills accrued by herself and son James, who spent considerable time in intensive care. Roosevelt County eventually agreed to pay Pamela’s bills. Neither entity has chosen to pay the bills accrued by James. This lawsuit results from the named defendants’ refusal to pay those bills. The unique feature to this dispute, however, is that each side refused to pay for the same reason, i.e., because each contends that the other is primarily responsible for payment for the medical services. The federal and county defendants have cross-claimed against each other for summary judgment on the basis that their programs are residual. Plaintiff has taken the position in various comprehensive memoranda that both defendants are liable for James’ bills, but that the IHS, as the party first approached, should pay. Several Montana counties were allowed to file memoranda as amicus curiae. After careful consider of this perplexing issue, the court is prepared to rule.

LIABILITY OF EACH DEFENDANT GROUP

There can be no dispute that Pamela and James McNabb, as residents of Roosevelt County, and indigent within the meaning of Title 58, Chapter 3, Montana Code Annotated, are eligible, under Montana’s general relief laws, for county medical assistance from defendant county. Roosevelt County does not seriously contest this, but instead predicates its position upon the assertion that its responsibility is merely secondary or residual to IHS. Having concluded that the county would ordinarily be responsible for these expenses, the court deems extended discussion unnecessary.

The federal defendants concede, as they must, that “the child, James McNabb, is an Indian eligible for health services from the Indian Health Services (IHS).” (Federal Defendants’ brief in support of motion for summary judgment, filed April 13, 1984, at p. 1). In this case, the relevant services consist of IHS contract health care services. 42 C.F.R. §§ 36.21 et seq. IHS refuses payment on the grounds that Roosevelt County is primarily responsible, and that IHS’ liability is merely residual. Thus we are faced with the unusual dilemma where an individual is apparently eligible for benefits under two programs yet serviced by neither.

This case presents the court with two unfortunate realities. First, both parties to this action are having considerable difficulty making their obviously finite financial resources meet the needs of their respective constituencies. The decision in this case can only darken an already bleak economic picture for one of the defendants. Second, there is a paucity of case law squarely on point. The court is confident, however, that the result achieved herein is most consonant with the relevant statutes and cases, viewed in conjunction with the history of our government’s involvement in Indian affairs.

RESIDUALITY CLAIMS

The basis for Roosevelt County’s assertion that it is merely secondarily responsible for James McNabb’s medical bills is Montana administrative rule § 46.9.509, A.R.M. That regulation states, in part:

Medical Resources: (1) County medical programs are to be considered only after all other medical assistance resources have been determined and, where available, used. Resources include but are not limited to:
(a) medical assistance (medicaid);
(b) Indian health services; ____

The federal defendants claim that this rule was repealed prior to the date when Roosevelt County decided to refuse payment of the contested charges. The record reflects that the effective date of repeal was August 13, 1982, that the County’s initial decision to deny coverage was made in February, 1982, but further, that this decision was reconsidered during a period subsequent to repeal. Additionally, the federal group contends that the County is liable because, not having promulgated a state approved county medical assistance plan, said county was required to use Montana’s Medicaid eligibility rules, which disallow consideration of IHS as a prior resource. Consideration of these contentions is unnecessary, because the court accepts the premise that Roosevelt County, under different circumstances, would be responsible for payment.

IHS relies on the so-called “alternate resource” rule, 42 C.F.R. § 36.23(f), which provides:

(f) Alternate resources. Contract health services will not be authorized by the Indian Health Service when, and to the extent that, alternate resources for the provision of necessary medical services are available and accessible to the individual requesting the services or would be available and accessible upon application of the individual to the alternate resource.

Alternate resources are defined as:

... resources other than those of the Indian Health Service contract health services program, available and accessible to the individual, such as health care providers and institutions (including facilities operated by the Indian Health Service), health care payment sources, or other health care programs for the provision of health services (e.g., medicare or medicaid) for which the individual may be eligible.

Absent the availability of alternate resources, therefore, IHS is responsible for providing medical care and or payment.

Plaintiff’s frustration is understandable. Neither defendant can deny responsibility, but neither will accept it. Plaintiff's position, which this court deems entirely reasonable, is that “available and accessible” (federal regulation) and “available” (state regulation) mean actually available. She cites several cases, dealing with various public entitlement programs, which support her view. In Shea v. Vialpando, 416 U.S. 251, 94 S.Ct. 1746, 40 L.Ed.2d 120 (1974), the Court invalidated a state regulation which failed to consider actual work expenses in computing AFDC benefits, because that regulation merely presumed expenses of $30 per month. In Van Lare v. Hurley, 421 U.S. 338, 95 S.Ct. 1741, 44 L.Ed.2d 208 (1975), also an AFDC case, the Court struck down New York’s “lodger” regulations, because “they are based on the assumption that the non-paying lodger is contributing to the welfare household, without inquiry into whether he in fact does so.” 421 U.S. at 346, 95 S.Ct. at 1747. A similar regulation was found objectionable in Lewis v. Martin, 397 U.S. 552, 90 S.Ct. 1282, 25 L.Ed.2d 561 (1970); there, the Court held that a step parent could not be considered a bread winner “.. unless bread is actually put on the table.” 397 U.S. at 559, 90 S.Ct. at 1286. See also, Heckler v. Turner, — U.S. -, -, 105 S.Ct. 1138, 1147, 84 L.Ed.2d 138 (1985).

Research into recent decisions brought this court’s attention to the Ninth Circuit holding in Schrader v. Idaho Dept. of Health and Welfare, 768 F.2d 1107 (9th Cir.1985), which considered whether real property should be counted as an available resource in computing AFDC benefits. The Circuit Court reversed the decision of the district court, and remanded the matter for consideration of an Idaho regulation which, the court found, failed to adequately weigh whether certain non-liquid assets were reasonably available to the needy family. For present purposes, one aspect of the opinion is especially instructive. The Circuit Court was quite careful to emphasize that it was not attempting to encourage malingering, or to reward AFDC recipients who were not attempting in good faith to find a reasonable market, and price, for their real property. 768 F.2d at 1115. The court merely felt that an assessment of “availability” required some inquiry into the realities of the particular situation. The same can be said here. The record provides ample evidence that Pamela McNabb made considerable effort to obtain medical assistance payments from two parties with statutory responsibility to help her. She went initially, as the mother of an Indian child, to IHS. They sent her “across the street.” She went to the County, and they told her to look to IHS. Neither entity discharged its duty. However, in view of the federal government’s “unique obligation toward Indians,” Morton v. Mancari, 417 U.S. 535, 555, 94 S.Ct. 2474, 2485, 41 L.Ed.2d 290 (1974), discussed infra, IHS’ initial handling of Pamela McNabb, and steadfast refusal to pay her bills, continuing to date, cannot be upheld. TRUST RELATIONSHIP

This court need not present a treatise on the existence of, or duties arising from, the trust relationship existing between the federal government and the Indian people of this nation. That unique and important relationship exists, and has been recognized at least since the opinion of Chief Justice Marshall in Cherokee Nation v. Georgia, 30 U.S. (5 Pet.) 1, 80 L.Ed. 25 (1831), to the effect that the relationship of the Indian people and the United States “resembles that of a ward to his guardian.” Subsequent decisions in Worcester v. Georgia, 31 U.S. (6 Pet.) 515, 8 L.Ed. 483 (1832) and United States v. Kagama, 118 U.S. 375, 6 S.Ct. 1109, 30 L.Ed. 228 (1886), were to the same effect. Though Congressional interest and action in the area of Indian health was slow to progress, several legislative enactments over the years have addressed their health needs. See, Cohen, HANDBOOK OF FEDERAL INDIAN LAW, pp. 696-97. Prompted by the sobering results of several surveys, President Taft sent a special message to Congress concerning the “deplorable health and sanitary conditions on reservations.” Cohen, at 697, citing S. Tyler, A History of Indian Policy 107 (Wash.: Gov’t Printing Office, 1973). One result was the Snyder Act of 1921, 25 U.S.C. §§ 13, et seq. (as amended), setting aside funds for “the relief of distress and conservation of health” of Indians. Though the Snyder Act provides statutory authority for the IHS program, the federal defendants take strong exception with the view that this legislation establishes Indian health care as the sole responsibility of the federal government.

This court agrees that neither the Snyder Act nor the federal government’s historical involvement with general Indian welfare totally relieves the various reservation states of responsibility for Indians’ well being. The express language of Snyder, however, cannot be ignored. In arguing that the Indian Health Care Improvement Act of 1976 (“IHCIA”), discussed infra, did not supersede Snyder, the federal group maintains that “the Snyder Act is still the basic Indian Health Service authority.” They cite to the House of Representatives’ report of April 9, 1976, which states that the Snyder phrase “for the relief of distress and conservation of the health of Indians” remains “the basic legislative statement of the Federal Government’s obligation to provide health services to Indians.” Regardless of whether or not passage of IHCIA was intended to undermine the importance of the Snyder Act, this language from Snyder hardly condones or ratifies the federal government’s treatment of Pamela McNabb. It is not necessary that this court adopt the holding of Bullchild v. Mathews, No. C75-606V (W.D.Wash.1981), to the effect that the Snyder Act and related regulations create an entitlement on the part of Indians to contract health care. Amicus persuasively argues this position, but this court need not adopt it when fashioning the relief ordered below. Instead, the importance of Snyder results from two related observations. First, as the Ninth Circuit held more than ten years ago, the Snyder Act was enacted out of the federal government’s “overriding duty of fairness when dealing with Indians, one founded upon a relationship of trust for the benefit of” Indian persons. Fox v. Morton, 505 F.2d 254, 255 (9th Cir.1974), citing, Seminole Nation v. United States, 316 U.S. 286, 62 S.Ct. 1049, 86 L.Ed. 1480 (1942). As such, the Snyder Act programs must be “liberally construed in their [Indians] favor.” Fox, 505 F.2d at 255. Fox therefore undermines any argument that the federal trust responsibility to Indians arises only where Indian property held in trust by the federal government is at issue. Second, the court believes that while Snyder may not, in itself, create an entitlement in favor of Indians, it cannot be viewed in isolation from the trust responsibility. Accordingly, consideration of Snyder, IHCIA, and the facts of this case must be performed against the background of the federal government’s pervasive involvement in Indian affairs.

In the well reasoned and lengthy opinion of White v. Califano, 437 F.Supp. 543 (D.So.Dak.1977), aff'd., 581 F.2d 697 (8th Cir.1978), the district court did not reject a Snyder/entitlement analysis, but instead relied on IHCIA, because the 1976 enactment was more recent, and “on point.” 437 F.Supp. at 558. Briefly, White presented the question of whether local government coffers or federal programs would be tapped in supplying emergency mental health care for a seriously ill reservation Indian. The court concluded, inter alia, that state and county officials lacked the authority to involuntarily commit an allegedly mentally ill Indian person residing on a reservation. The federal defendants in the case sub judice attempt to distinguish White from the case at bar on the basis of this first conclusion. All of the other parties to this action, however, urge a complete reading of White. Indeed, the court believes that the real importance of White lies in its extended discussion of the federal government’s trust responsibility to Indians. Further, this court believes that the trust analysis employed in White was equally responsible for the result reached therein, to be accorded equal footing with the court’s conclusion that local governments had no authority to involuntarily commit mentally ill Indian persons.

The South Dakota court began by citing portions of IHCIA, which provide:

The Congress finds that—
(a) Federal health services to maintain and improve the health of the Indians are consonant with and required by the Federal Government’s historical and unique legal relationship with, and resulting responsibility to, the American Indian people. (Emphasis ours.)
(b) A major national goal of the United States is to provide the quantity and quality of health services which will permit the health status of Indians to be raised to the highest possible level and to encourage the maximum participation of Indians in the planning and management of those services. 25 U.S.C. § 1601.

IHCIA further provides:

The Congress hereby declares that it is the policy of this Nation, in fulfillment of its special responsibilities and legal obligations to the American Indian people, to meet the national goal of providing the highest possible health status to Indians and to provide existing Indian health services with all resources necessary to effect that policy. 25 U.S.C. § 1602.

After finding that the above-quoted language “is the latest statement of Congress on the trust responsibility of the federal government in relation to Indian tribes in the area of health services,” the court found a duty to act on the part of the federal parties, emanating from that trust responsibility “as recognized and defined by statute.” 436 F.Supp. at 556-57.

Plaintiff embraces the holding in White, and bolsters her position through an impressive discussion of the legislative history underlying IHCIA. Reports and hearing testimony repeatedly refer to IHS as the “primary” provider of Indian health care. Section (g) of IHCIA (25 U.S.C. § 1601(g)) indicates that improved federal Indian health services will foster Indians’ confidence in those services, which will result in “better Indian health.” Health care was described as the “cornerstone” for all other federal programs benefitting Indians. Finally, plaintiff points out that the residuality regulation (42 C.F.R. § 36.21(a)) itself specifically refers to Medicare and Medicaid as possible “alternate resources,” with no mention of state or local programs. This specific reference to other federal programs lends credence to the view that the federal government has taken the ultimate responsibility for Indian health care upon itself, and that this responsibility cannot be sidestepped in the manner attempted here.

Therefore, this court does not find in the trust doctrine, the Snyder Act, or IHCIA, standing alone, an entitlement in favor of Indian persons to health care dollars. It does find, however, that those statutes, read in conjunction with the trust doctrine, place the burden, in the first instance, upon the IHS programs to assure reasonable health care for eligible members. This is particularly true where, as here, the federal program was approached initially. As Judge Bogue so succinctly stated in White, the question simply becomes whether the federal defendants can abandon the plaintiff entirely. There, given its set of facts, the court found that an individual requiring an involuntary commitment could not be abandoned. Though a mental commitment and resulting jurisdictional impediments are not involved here, the principle remains the same. The policies underlying the trust doctrine, and the holdings in White and Bullchild, coupled with the clear intention of Congress to provide “the highest possible health status to Indians,” as manifested by Snyder and IHCIA, mandate that the federal defendants cannot abandon. Pamela McNabb either.

The court acknowledges that this is a difficult issue with no simple answers. Finite resources are involved. The difficult issues inherent in the field of Indian law arise. The result achieved herein best comports with the state of the law as it exists today, shaped by the federal government’s many years of dealing in Indian affairs. The better avenue for resolution of disputes of the type presented here rests with the legislative branch. This court can only interpret the limited legislative enactments and statements of Congressional intent available to it. Congress could quickly resolve a question which this court has wrestled with for many months. Unless and until it does so, the ultimate responsibility for this eventuality rests with the federal government, which is also the only entity which can itself solve the problem.

Accordingly, for the foregoing reasons, IT IS HEREBY ORDERED AND ADJUDGED that the federal defendants’ motion for summary judgment is DENIED, a similar motion filed by the county defendants is GRANTED, and judgment shall be entered to the effect that the Indian Health Service shall pay the relevant medical bills incurred by James McNabb from its contract care allocation. The question of attorneys’ fees shall be considered upon motion by plaintiff.


author: HILLMAN, District Judge.

text:
    Michael SWARTS, Plaintiff, v. Perry JOHNSON, Director of the Michigan Department of Corrections; Richard Handlon, Warden at Michigan Training Unit; and Rudy Davidson, Defendants.
    No. G83-1378CA6.
    United States District Court, W.D. Michigan, S.D.
    Jan. 27, 1986.

      Chambers, Steiner, Mazur, Omstein & Amlin by Franklin J. Chambers, Kalamazoo, Mich., for plaintiff.
    Frank J. Kelley Atty. Gen. by David G. Edick, Asst. Atty. Gen., Corrections Div., Lansing, Mich., for defendants.
   OPINION RE MOTION FOR SUMMARY JUDGMENT

HILLMAN, District Judge.

This matter is before the court on defendants Johnson’s and Handlon’s motion for summary judgment pursuant to Fed.R. Civ.P. 56. For the reasons stated below, defendants’ motion is granted.

FACTUAL BACKGROUND

At all relevant times, plaintiff Michael Swarts and defendant Rudy Davidson were incarcerated at the Michigan Training Unit (“MTU”) in Ionia, Michigan, defendant Richard Handlon was the Warden at MTU, and defendant Perry Johnson was the Director of the Michigan Department of Corrections (“MDoC”). On November 27, 1980, plaintiff was assaulted by another MTU inmate, allegedly defendant Davidson, and sustained trauma to and loss of sight in the right eye.

Plaintiff filed suit under 42 U.S.C. § 1983, alleging that the acts and omissions of defendants Johnson and Handlon deprived him of his eighth amendment right to be free from cruel and unusual punishment. His complaint also asserts pendent state negligence claims against defendants Johnson and Handlon and a pendent state assault and battery claim against defendant Davidson. Defendant Davidson has apparently never been served.

The essence of plaintiffs federal claim against defendant Johnson is that he failed to promulgate appropriate rules to “avoid the foreseeable risk of harm to other inmates caused by unreasonably dangerous inmates” like Davidson; that this failure to promulgate rules was a proximate cause of plaintiffs injuries and constitutes cruel and unusual punishment. The essence of plaintiffs federal claim against defendant Handlon is that he knew or should have known that Davidson was violent, and his failure to remove Davidson from the general prison population constitutes cruel and unusual punishment and was a proximate cause of plaintiff’s injuries.

Defendants Handlon and Johnson move for summary judgment on grounds that the facts establish only an isolated assault and no foreknowledge on their part of any threat or danger specific to plaintiff, facts insufficient to state an eighth amendment deprivation. Alternatively, defendants argue that qualified immunity and/or eleventh amendment immunity bar the claims against them. Additional facts necessary to resolve the motion will be presented in the body of the opinion.

STANDARD OF REVIEW

On a motion for summary judgment, movant bears the burden of showing conclusively that no genuine issue of material fact exists. Smith v. Hudson, 600 F.2d 60 (6th Cir.), cert dismissed, 444 U.S. 986, 100 S.Ct. 495, 62 L.Ed.2d 415 (1979); Tee-Pak, Inc. v. St. Regis Paper Co., 491 F.2d 1193 (6th Cir.1974); Fed.R.Civ.P. 56(a). In determining whether issues of fact exist, “the inferences to be drawn from the underlying facts contained in [the attached exhibits and depositions] must be viewed in the light most favorable to the party opposing the motion.” United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 994, 8 L.Ed.2d 176 (1962). A court may not resolve disputed questions of fact in a summary judgment decision, and if a disputed question of fact remains, the district court should deny the motion, and proceed to trial. United States v. Articles of Device, 527 F.2d 1008, 1011 (6th Cir.1976).

DISCUSSION

1. Section 1983 claim.

Plaintiff’s section 1983 claim against defendants Johnson and Handlon is that they, acting under color of state law, subjected him to cruel and unusual punishment in violation of the eighth amendment by exposing him to an unreasonable risk of assault from other inmates.

Mere negligence on the part of prison officials is insufficient to establish such an eighth amendment violation. Stewart v. Love, 696 F.2d 43, 44 (6th Cir.1982). Plaintiff must instead show an unreasonable risk of injury and “acts or omissions [of prison officials] sufficiently harmful to evidence deliberate indifference” to plaintiff’s physical wellbeing. Estelle v. Gamble, 429 U.S. 97, 106, 97 S.Ct. 285, 292, 50 L.Ed.2d 251 (1976). As noted in Little v. Walker, 552 F.2d 193, 198, n. 8 (7th Cir.1977), cert. denied, 435 U.S. 932, 98 S.Ct. 1507, 55 L.Ed.2d 530 (1978), citing Estelle, supra:

“[w]hile mere inadvertence or negligence cannot support a Section 1983 action raising Eighth Amendment issues, deliberate indifference, ‘[r]egardless of how evidenced] — either by actual intent or recklessness — will provide a sufficient foundation.”

Generally, “an isolated or occasional attack” is insufficient to state an eighth amendment violation, Stewart, supra; Williams v. Fields, 416 F.2d 483 (9th Cir.1969), cert. denied, 397 U.S. 1016, 90 S.Ct. 1252, 25 L.Ed.2d 431 (1970). As a general rule,

“... there must be a showing of either a pattern of indisputed and unchecked violence or, on a different level, of an egregious failure to provide security to a particular inmate, before a deprivation of constitutional right is stated.”

Penn v. Oliver, 351 F.Supp. 1292, 1294 (E.D.Va.1972). This court has defined “egregious” as “flagrant, blatant, outrageous.” Webster v. Foltz, 582 F.Supp. 28 (W.D.Mich.1983).

Further, section 1983’s language demands a degree of personal involvement connecting a defendant to the claimed deprivation of a constitutional right, and “in § 1983 actions public officials cannot be held vicariously liable for the wrongdoing of others.” Monell v. N.Y. City Dept. of Social Services, 436 U.S. 658, 98 S.Ct. 2018, 56 L.Ed.2d 611, (1978); Coffy v. Multi-County Narcotics Bureau, et al, 600 F.2d 570, 580 (6th Cir.1979); Redmond v. Baxley, 475 F.Supp. 1111, 1115 (E.D.Mich.1979).

Applying the foregoing principles to plaintiffs claims against defendant Johnson, I am satisfied that his motion for summary judgment should be granted for the following reasons. Plaintiffs complaint seeks to hold defendant Johnson liable on grounds that he failed to promulgate appropriate rules to avoid the foreseeable risk of harm to other inmates caused by unreasonably dangerous inmates such as defendant Davidson. The record provides no factual basis for this claim and instead reveals that Johnson in fact promulgated numerous policies addressing security procedures and the specific problem of foreseeable violence inherent in any prison. See, e.g., PD-DWA 30.01; PD-DWA 30.06.

Without amending his complaint, plaintiff now claims that Johnson may be held personally liable on grounds that as Director of MDoC at the time of plaintiffs injury, Johnson was the person responsible for overcrowding in the state’s prisons. Plaintiff theorizes that this overcrowding, in combination with security classification and chain of command policies promulgated by Johnson, led to the events and decisions regarding Davidson which kept him in the general prison population and allegedly permitted his assault on plaintiff to occur. In plaintiff’s answer to defendants’ motion for summary judgment, these claims are summarized as follows:

“Granted, Johnson is not liable on a respondeat superior doctrine. However, since Michael Swartz’ constitutional rights have been deprived, in part, due to the overcrowding and inability to transfer dangerous inmate Davidson, Johnson is sufficiently involved for liability to attach. He was the Director of the Department of Corrections at that time. He was responsible for setting up this system whereby a person such as Dr. Houseworth, who did not have the benefit of the file itself, or the opportunity to discuss the issue of transfer in detail with the requesting personnel [sic]. In fact, Dr. Houseworth indicated that he originally approved the recommendation for transfer and agreed with it, and then crossed off his signature and wrote in a denial. He indicated that this could have been due to overcrowding. As director of the Department of Corrections at that time, Defendant Johnson is the person responsible for this overcrowding. In addition, he was responsible for the employee handbook and rules which prevented people such as Roxanne Thibault, who knew Rudy Davidson was dangerous and needed to be transferred to a closer custody facility, from stepping out of line and going over Dr. Houseworth’s head, or even calling Dr. Houseworth herself. As indicated in her deposition, rules promulgated by the department prevented her from doing that.”

Plaintiff's new theory of liability as to defendant Johnson is deficient on a number of levels. I would note, without ruling, that defendant Johnson’s purported contribution to plaintiff’s injury is, from an analytical standpoint, so attenuated that it cannot seriously be argued that the assault on plaintiff was a natural consequence of Johnson’s conduct. The evidence is undisputed that Johnson never had any prior awareness or knowledge of a threat to plaintiff’s safety — plaintiff never asked for protective custody prior to being assaulted on November 27, 1980. Plaintiff’s own deposition testimony negates any inference that a pattern of inmate assaults occurred in the area of the prison where plaintiff was housed. Further, there is Sixth Circuit authority for the proposition that a prison official cannot be held personally liable in damages for prison overcrowding and the consequences of that overcrowding. Schmidt v. Wingo, 499 F.2d 70, 74 (6th Cir.1974). I also agree with defendants that the challenged security classification and chain of command policies were not the moving force nor cause in fact of any purported constitutional violation. Finally, the record contains the uncontroverted deposition testimony of Johnson that security classification recommendations made by the Security Classification Committee (“SCC”) were ultimately decided by Dr. Houseworth, the regional administrator, who possessed absolute discretion, within reason, to deny or approve a recommended transfer or security reclassification, and Johnson himself had no responsibility or obligation to oversee the day-today operations of any MDoC facility or sub-unit.

In short, plaintiff has failed to show the requisite degree of personal involvement connecting defendant Johnson to the claimed deprivation of plaintiff’s constitutional rights, nor has plaintiff established any act or omission on his part sufficiently harmful to evidence deliberate indifference to plaintiff’s physical well-being. Accordingly, defendant Johnson’s motion for summary judgment should be granted.

I am also satisfied that defendant Handlon is entitled to summary judgment dismissing the claims against him. As indicated, plaintiff’s own deposition testimony reveals that this is an isolated assault case, not a case involving a pattern of undisputed and unchecked violence at MTU. Plaintiff’s deposition testimony further establishes that Handlon had no prior awareness or knowledge of any specific threat to plaintiff and indeed could have had none, since plaintiff never requested protection before he was assaulted and plaintiff’s only contact with Handlon occurred after the assault, when plaintiff requested a transfer.

Viewing the record in the light most favorable to plaintiff, there is evidence that Handlon, because of the passage of SCC documents over his desk, knew of Davidson’s assaultive propensities. He knew that the SCC had recommended his transfer to a closer custody facility, he approved that recommendation, and knew that Dr. Houseworth, the regional administrator, had subsequently denied the recommended transfer. There is further evidence that after denial of that transfer recommendation by Dr. Houseworth, Handlon, on November 13, 1980, approved Davidson’s application requesting transfer to a resident “halfway” home, even though comments on the transfer application indicated that Davidson was a very poor case for such a transfer and indicated that the SCC had earlier recommended that he be transferred to closer supervision. Handlon admitted that there was a strong possibility that overcrowding problems influenced his decision to approve Davidson’s halfway house transfer application, even though that decision seemed to inherently contradict the SCC recommendation that he be transferred to closer rather than less restrictive custody. There is further evidence that the halfway house transfer application was subsequently denied by Handlon’s superiors on November 17, 1980, only ten days prior to Davidson’s assault on plaintiff.

Plaintiff claims that Handlon’s conduct regarding Davidson was callously indifferent because he did not care whether Davidson was moved to closer custody or to a halfway house, as long as he was moved out of the MTU. There is an inherent illogic in plaintiff’s approach. Plaintiff damns Handlon for allowing Davidson to remain in the general prison population despite his violent propensities, but relies upon evidence which, on even the most liberal reading, establishes that Handlon consistently did what he could to get Davidson out of the MTU. Handlon approved the closer custody transfer recommendation which Houseworth ultimately denied. Handlon approved Davidson’s halfway house transfer application, which Handlon’s superiors ultimately denied.

The record establishes that Handlon’s position did not permit him to overrule final security classification and transfer recommendation decisions made by his superior, Dr. Houseworth. Handlon testified that as warden, he could contact Dr. Houseworth if he disagreed with a denial of a transfer requested. He testified that he probably did not bother to speak to Dr. Houseworth about denial of the closer custody transfer recommendation, or about the problems generally presented by Davidson, because in his opinion as warden, “we had many other young men in this institution who had records just as bad and a behavior pattern just as bad as Rudy Davidson.”

Finally, Handlon certainly would have been obligated to provide plaintiff with protection if plaintiff had requested it. In the absence of such a request, and in the absence of some conduct by Davidson allowing punitive segregation and disciplinary action to be taken against him, plaintiff has pointed to no authority on Handlon’s part to simply remove Davidson from the general population and impose restrictions upon him.

Even the most liberal reading of the evidence leads to only one conclusion — if plaintiff has established anything against Handlon, at the very most he has established a weak inference of potential simple negligence on Handlon’s part in failing to call Dr. Houseworth to lobby for a reversal of Houseworth’s denial of the closer custody transfer recommendation. The record is barren of facts to support an inference that Handlon’s conduct regarding Davidson was egregious or sufficiently harmful to evidence deliberate indifference to plaintiff’s physical well-being. The case law consistently holds that there must be more than an isolated incident of negligent failure to protect to establish an eighth amendment deprivation claim under section 1983. See Webster v. Foltz, Penn v. Oliver, and Williams v. Fields, supra.

Finally, the following observations, distressing as they may be, are pertinent here and worthy of note:

“Indeed it is doubtful that inmate against inmate violence can ever be prevented within a prison setting no matter how carefully a prison might be operated. Courts must comprehend the magnitude of the prison administrators’ problem and recognize the distinctly unique situation caused by confining human beings in a tension-filled atmosphere. Inmate assaults upon inmates are not unusual in the best run prisons.”

Campbell v. Anderson, 335 F.Supp. 483, 486 (D.Del.1971). For the reasons stated above, defendant Handlon’s motion for summary judgment is granted.

2. Pendent State Claims.

Plaintiff’s federal claims thus being dismissed prior to trial, plaintiff’s pendent state claims are hereby dismissed as well. United Mine Workers v. Gibbs, 383 U.S. 715, 726-727, 86 S.Ct. 1130, 1139-1140, 16 L.Ed.2d 218 (1966). See also Nash & Associates, Inc. v. Lum’s of Ohio, Inc., 484-F.2d 392 (6th Cir.1973).

Conclusion

The motion for summary judgment filed by defendants Johnson and Handlon is granted. Plaintiff’s federal claims against them are dismissed with prejudice. Plaintiff’s pendent state claims against them are dismissed, without prejudice.

Since the sole claim against defendant Davidson is a pendent state claim for assault and battery, that claim is also dismissed without prejudice.