source: Caselaw Access Project

author: BEA, Circuit Judge:

license: Public Domain

text:
    Maria BRANDON, Plaintiff-Appellee, v. MARICOPA COUNTY; Sandra Wilson; Rocky Armfield; Paul Wilson; Chris Armfield, Defendants-Appellants.
    No. 14-16910
    United States Court of Appeals, Ninth Circuit.
    Argued and Submitted October 20, 2016, San Francisco, California
    Filed February 23, 2017

      Kimberly A. Demarchi (argued) and Jared L. Sutton, Lewis Roca Rothgerber LLP, Phoenix, Arizona; Michele M. Iaf-rate, Iafrate- & Associates, Phoenix, Arizona; for Defendants-Appellants.
    Larry' J. Cohen (argued), Cohen Law Firm, Phoenix, Arizona, for Plaintiff-Ap-pellee.
    Before: CARLOS T. BEA and SANDRA S. IKUTA, Circuit Judges, and JANE A. RESTANI, International Trade Judge.

       The Honorable Jane A. Restani, Judge for the United States Court of International Trade, sitting by designation.

   OPINION

BEA, Circuit Judge:

Appellee Maria Brandon worked for many years as a civil litigation attorney for the Maricopa County Attorney’s Office (MCAO), and later (briefly) as a direct employee of Maricopa County, defending the county and related entities in civil lawsuits, before again returning to her previous employment at the MCAO. During her time as a direct employee of the county she received a call at her office from a newspaper reporter inquiring about a case she was handling for the Maricopa County Sheriffs Department. One of her comments to the reporter about the case was later published in an article in that newspaper. This article suggested that the county substantially increased settlement offers to avoid having key county officials testify.

After Brandon returned to the MCAO, county officials responsible for overseeing risk management and civil lawsuits against the county thought her conduct in talking about the case mentioned was unprofessional for a lawyer representing the county. In light of what they considered were justifiable misgivings regarding Brandon’s judgment, these officials requested that Brandon not be assigned further cases in which the county was a party and which involved risk management. Brandon was later terminated from employment with the MCAO. She filed a lawsuit against the county and certain county officials. A jury found for Brandon and against Maricopa County on her claim that she had been fired in retaliation for her exercise of First Amendment rights in speaking to the newspaper reporter, and against certain county officials for state-law based tortious interference with her employment contract. The district court entered judgment on the basis of the jury’s verdicts.

We reverse.

I.

Maria Brandon, Appellee-Plaintiff, was employed by the MCAO for several decades as a civil litigation attorney. She left the MCAO in 2009 to take a job with the “Special Litigation” department formed by Maricopa County to substitute for the MCAO in certain civil lawsuits. While at Special Litigation and still representing Maricopa County as an attorney, Brandon spoke to an Arizona Republic reporter who called her office line to elicit comment on the county’s settlement of a lawsuit, which claimed sheriff department brutality towards protestors, in which Brandon was an attorney of record. The newspaper reporter called Brandon because a confidential memo Brandon had written was leaked by person(s) other than Brandon. Brandon expressly authorized the newspaper to publish her spoken comments but refrained from commenting directly on the memo. The newspaper article suggested that the county made an overly generous settlement offer to prevent embarrassing certain county officials who might have been required to answer questions in depositions. On this issue, the newspaper related that Brandon said: “I don’t know why they did what they did, and I’m sure they have their reasons.”

Special Litigation was later disbanded after the Arizona courts ruled that the county did not have statutory authority to reassign commonplace legal work outside the MCAO. Brandon was then rehired in 2011 by the MCAO with a contract that included a probationary period. During the probationary period, her employment was terminated ostensibly because of an altercation she had with another staff member.

After being fired, Brandon filed a lawsuit against Maricopa County and various county officials for multiple claims related to her termination. The case was narrowed to four claims eventually tried to a jury: 1) that Maricopa County and her MCAO supervisor had retaliated against her for exercising her First Amendment rights, by talking to the newspaper reporter, in violation of 42 U.S.C. § 1983; 2) that the County and her supervisors violated her due process rights in violation of 42 U.S.C. § 1983 by terminating her without following proper procedures; 3) that the County had wrongfully terminated her employment under state law; and 4) that County risk management officials, Sandra Wilson and Rocky Armfield, had tortiously interfered with her employment contract by asking the MCAO to reassign her cases to another lawyer.

Following a seven day trial, the jury returned a verdict in favor of Brandon against Maricopa County on her claim of violation of her First Amendment rights in connection with the newspaper interview and awarded nominal damages of $1. The jury also returned a verdict in favor of Brandon against defendants Armfield and Wilson for tortious interference with her employment contract and awarded damages of $638,147.94. The jury found for defendants on Brandon’s due process and wrongful termination claims, which claims are not at issue in this appeal. Defendants later filed a motion for judgment as a matter of law or, alternatively, for a new trial, as to the First Amendment and contract interference claims, which the district court denied. The district court subsequently awarded $802,175.28 to the plaintiff for attorney fees under 42 U.S.C. § 1988(b) as the prevailing party on the First Amendment claim, a 42 U.S.C. § 1983 claim.

On appeal Appellants first argue that, as a matter of law, the jury wrongfully imposed liability for the tortious interference with contract claim, for their conduct did not create legal liability under Arizona tort law. Appellants next argue that Brandon’s speech to the newspaper was, again as a matter of law, made pursuant to her official duties and, therefore, not protected by the First Amendment from discipline, such that any adverse employment actions taken against Brandon by her employer because of the newspaper interview do not give rise to any legal liability under 42 U.S.C. § 1983. Appellants seek reversal on both claims.

II.

Under Arizona tort law, a necessary element of tortious interference with contract is that such interference be “improper.” Wagenseller v. Scottsdale Mem’l Hosp., 147 Ariz. 370, 388, 710 P.2d 1025 (1985) (superseded by statute on other grounds). Impropriety “generally is determined by weighing the social importance of the interest the defendant seeks to advance against the interest invaded.” Snow v. W. Sav. & Loan Ass’n, 152 Ariz. 27, 34, 730 P.2d 204 (1987). The Arizona Supreme Court has recognized that an action is not “improper” when an alleged interferer “(1) ... has or honestly believes he has a legally protected interest, (2) which he in good faith asserts or threatens to protect, and (3) he threatens to protect it by proper means.” Id. at 34-35, 730 P.2d 204 (discussing Restatement (Second) of Torts § 773). Earlier Arizona case law also cited in Snow explained: “One is privileged to interfere with a contract between others when he does so in the bona fide exercise of his own rights or when he possesses an equal or superior interest to that of the plaintiffs in the subject matter.” McReynolds v. Short, 115 Ariz. 166, 170-71, 564 P.2d 389 (App. 1977).

This doctrine placing a limit on what is “improper” makes good practical sense. Individuals (such as county representatives Wilson and Armfield) who have a legitimate interest in the performance of a contract between two third parties (such as the employment contract between Brandon and the MCAO entered into to provide legal services to their employer, the county) should not face potential tort liability for concerning themselves with the performance of that contract. In a word, certain county employees have a legitimate interest in who is a lawyer for their agency-

The communications of a client (the county, as represented by Wilson and Armfield) speaking to its attorney (the MCAO) requesting specific legal personnel be removed from certain county matters fits the situation contemplated by Snow and McReynolds. The district court, however, rejected Appellants’ argument on this point by finding that Maricopa County’s risk management office (where Wilson and Armfield worked) was “not the ‘client’ for purposes of this analysis.” This conclusion is factually incorrect because the record is undisputed that the risk management office coordinated, on behalf of the county, with the MCAO to manage the resolution of civil lawsuits against the county. The record establishes that the County was acting through its risk management office and personnel in its interactions with the MCAO. No reasonable jury could find otherwise from the record here.

As such, risk management officials Wilson and Armfield had a legally protected interest in ensuring the MCAO provided quality legal services to the county. Wilson and Armfield requested reassignment of risk management cases because Brandon publicly commented on a sensitive and ongoing county legal matter in a manner they reasonably perceived as unprofessional and betraying her duty of loyalty. On this record, requesting that MCAO supervisors remove from certain cases one of their lawyers reasonably perceived as a liability to the county certainly cannot be considered an improper means for protecting the county’s legitimate legal interests, even if Wilson and Armfield did not have statutory authority to fire Brandon. Under Snow and McReynolds, no reasonable jury could conclude that Wilson and Armfield “improperly” interfered with Brandon’s employment contract (made for the express purpose of serving the county’s legal needs) when they requested reassignment of risk management cases to other MCAO lawyers. Arizona law’s respect for a client’s broad discretion in the selection of a legal representative of his or her own choosing further undergirds the propriety of Wilson and Armfield’s actions. Ariz. Sup. Ct. 42, ER 1.16 cmt. 4 (“A client has a right to discharge a lawyer at any time, with or without cause, subject to liability for payment for the lawyer’s services”); State Farm Mut. Ins. Co. v. St. Joseph’s Hosp., 107 Ariz. 498, 501, 489 P.2d 837 (1971) (“[T]he law in Arizona is clear that a client has the absolute right to terminate the attorney-client relationship at any time, with or without cause”).

No reasonable jury could conclude on this record that the county’s risk management office was “not the ‘client.’ ” The tortious interference with contract judgment entered upon the jury’s verdict against defendants Wilson and Armfield is thus reversed because, as a matter of law, their conduct was not improper.

III.

Speech made by public employees in their official capacity is not insulated from employer discipline by the First Amendment but speech made in their private capacity as a citizen is. Garcetti v. Ceballos, 547 U.S. 410, 421, 126 S.Ct. 1951, 164 L.Ed.2d 689 (2006) (“We hold that when public employees make statements pursuant to their official duties, the employees are not speaking as citizens for First Amendment purposes, and the Constitution does not insulate their communications from employer discipline.”). The Supreme Court has explained that neither an employee’s job description nor the location or content of the allegedly protected speech dispositively determines whether an employee was speaking as a citizen. Id. at 420-25, 126 S.Ct. 1951. Rather, the Supreme Court emphasized that:

The proper inquiry is a practical one. Formal job descriptions often bear little resemblance to the duties an employee actually is expected to perform, and the listing of a given task in an employee’s written job description is neither necessary nor sufficient to demonstrate that conducting the task is within the scope of the employee’s professional duties for First Amendment purposes.

Id. at 424-25, 126 S.Ct. 1951. Later interpreting the Garcetti ease, the Ninth Circuit affirmed that generally “the question of the scope and content of a plaintiffs job responsibilities is a question of fact.” Posey v. Lake Pend Oreille Sch. Dist. No. 84, 546 F.3d 1121, 1130 (9th Cir. 2008) (dispute over whether a school security guard’s duties related to student discipline extended to internal communications on security policies). See also Eng v. Cooley, 552 F.3d 1062, 1071 (9th Cir. 2009) (“the question of the scope and content of a plaintiffs job responsibilities is a question of fact”) (internal quotation marks and citation omitted). Yet in synthesizing relevant Ninth Circuit precedent since Garcetti, an en banc panel of this Court in Dahlia v. Rodriguez, 735 F.3d 1060, 1074-76 (9th Cir. 2013), announced three guiding principles for undertaking the practical factual inquiry of whether an employee’s speech is insulated from employer discipline under the First Amendment. Dahlia involved a First Amendment retaliation suit brought by a police detective for being placed on leave after reporting beatings and serious physical abuse of certain arrested individuals by other members of the Burbank Police Department. Id. at 1063-64. The guiding principles are:

1. “First, particularly in a highly hierarchical employment setting such as law enforcement, whether or not the employee confined his communications to his chain of command is a relevant, if not necessarily disposi-tive, factor in determining whether he spoke pursuant to his official duties. When a public employee communicates with individuals or entities outside of his chain of command, it is unlikely that he is speaking pursuant to his duties.” Id. at 1074 (internal citations omitted).
2. “Second, the subject matter of the communication is also of course highly relevant to the- ultimate determination whether the speech is protected by the First Amendment... When an employee prepares a routine report, pursuant to normal departmental procedure, about a particular incident or occurrence, the employee’s preparation of that report is typically within his job duties... By contrast, if a public employee raises within the department broad concerns about corruption or systemic abuse, it is unlikely that such complaints can reasonably be classified as being within the job duties of an average public employee, except when the employee’s regular job duties involve investigating such conduct.” Id. at 1074-75 (internal citations omitted).
3. “Third, we conclude that when a public employee speaks in direct contravention to his supervisor’s orders, that speech may often fall outside of the speaker’s professional duties. Indeed, the fact that an employee is threatened or harassed by his superiors for engaging in a particular type of speech provides strong evidence that the act of speech was not, as a ‘practical’ matter, within the employee’s job duties notwithstanding any suggestions to the contrary in the employee’s formal job description.” Id. at 1075 (internal citations omitted). ■

The Dahlia court went on to apply these principles to find that the record showed that Dahlia’s statements disclosing police brutality raised triable issues of fact as to whether the statements were “protected by the First Amendment.” Id. at 1078.

With this legal standard in mind, we now turn to Appellants’ argument on appeal. Appellants claim that Brandon’s comment quoted by the Arizona Republic was made in her official capacity and thus not protected by the First Amendment for three reasons: 1) the comment involved a case she worked on as a county employee, 2) the comment discussed her work product, and 3) the comment was made on her county office phone in response to a call during normal business hours. The Appellants conclude from this that “the only reasonable conclusion that can be drawn is that Ms. Brandon commented to the press about one of her cases in her capacity as an attorney for the County,” such that her speech would not be citizen speech constitutionally protected under ' the First Amendment.

The district court rejected this same reasoning explaining that “[t]he key inquiry in determining whether speech is public or private is whether the speech was made pursuant to the employee’s official duties.” Garcetti, 547 U.S. at 421, 126 S.Ct. 1951. The district court emphasized that “the mere fact that a citizen’s speech concerns information acquired by virtue of his public employment does not transform that speech into employee — rather than citizen — speech” and, in fact, public employees speaking out based on information they learned in their employment “holds special value.” Lane v. Franks, — U.S. —, 134 S.Ct. 2369, 2379, 189 L.Ed.2d 312 (2014). The district court accepted that the county’s “authority to discipline its employees for improper or harmful comments to the press” could bar Brandon’s First Amendment retaliation claim, but found that the defendants provided no evidence to show that Brandon’s statement violated any policy, contained confidential information, harmed the county, or interfered with her duties so as to outweigh her First Amendment protections. Connick v. Myers, 461 U.S. 138, 150-51, 103 S.Ct. 1684, 75 L.Ed.2d 708 (1983). As such, the district court concluded that “Brandon’s speech was entitled to First Amendment protection” and declined to overturn the jury’s conclusion that Brandon was speaking as a citizen.

The error in the district court’s conclusion stemmed from its failure to undertake the “practical inquiry” required by Garcetti. Under Arizona law, as an attorney for the county Brandon had a broad fiduciary duty to her client — the county. In re Zang, 166 Ariz. 426, 430, 803 P.2d 419 (1990) (the “fiduciary duty to a client [is] the most important ethical duty a lawyer owes”). See also Restatement (Third) of the Law Governing Lawyers § 16 (“To the extent consistent with the lawyer’s other legal duties and subject to the other provisions of this Restatement, a lawyer must, in matters within the scope of the representation: (1) proceed in a manner reasonably calculated to advance a client’s lawful objectives, as defined by the client after consultation; (2) act with reasonable competence and diligence; (3) comply ivith obligations concerning the client’s confidences and property, avoid impermissible conflicting interests, deal honestly with the client, and not employ advantages arising from the client-lawyer relationship in a manner adverse to the client; and (4) fulfill valid contractual obligations to the client.”) (emphasis added). The scope of this fiduciary duty of loyalty extends broadly. Matter of Evans, 113 Ariz. 458, 462, 556 P.2d 792 (1976) (“An attorney’s loyalty to his client is not just a casual obligation to be turned on or off as the dictates of the moment indicate or particular employment may demand.”); see also In re Piatt, 191 Ariz. 24, 26, 951 P.2d 889 (1997) (“A lawyer is a fiduciary with a duty of loyalty, care, and obedience to the client. The relationship is, and must be, one of utmost trust.”). Moreover, Arizona’s rules of professional conduct for lawyers anticipate public statements made to media outlets to be part of an attorney’s duties representing a client. See Ariz. Sup. Ct. 42, ER 3.6(a); cf. Cox Ariz. Publ’ns, Inc. v. Collins, 175 Ariz. 11, 14-15, 852 P.2d 1194 (1993) (noting that Arizona’s rules of Professional Conduct for attorneys permit certain, but not all, interactions with the media relating to pending cases).

With the legally defined scope of an attorney’s duties in mind, it becomes obvious that Brandon’s comments to the newspaper could not constitute constitutionally protected citizen speech under the principles from Dahlia. First, while Brandon was not speaking within her chain of command, she was inevitably speaking as a lawyer representing the county as her public statements touched on the very matter on which she represented the county. Second, unlike in Dahlia, Brandon did not bring up any allegation of corruption or other serious misconduct in her statement to the newspaper, she merely suggested that she disagreed with the settlement figures authorized by the county’s representatives. While the newspaper article suggested the county paid too much to protect certain employees from public criticism, Brandon’s published statement made no such allegation but merely reflected negatively on her client. That the attorney who handled the case did not “know why [the client] did what they did” implies the client was acting without professional advice when paying the settlement. Brandon’s statement that they must “have their reasons” cements the implication that the client was acting unprofessionally. Indeed, if Brandon alleged any sort of misconduct this would be a different case. Third, as was expressly recognized by various witnesses at trial, Brandon’s statements to the Arizona Republic did not violate any MCAO policy, to the extent applicable, or County policy, which according to Dahlia iá'relevant to the analysis of whether Brandon’s speech was made in an official capacity 735 F.3d at 1075. Taken together, the only possible outcome of the “practical inquiry” required by Garcetti was that Brandon’s speech to the Arizona Republic fell under the broad set of official duties she owed Maricopa County as its attorney, and so was not constitutionally protected citizen speech. Unlike the police detective’s statements at issue in Dahlia, Brandon’s official speech could not be relegated only to certain times or places but, given the fiduciary duties imposed by her role as an attorney for the county, extended to what she said about matters relating to her representation of Maricopa County. For these reasons, the First Amendment retaliation verdict must be also reversed.

IV.

Because we remand for the district court to enter judgment for Appellants, there are no successful claims that could serve as the basis for a fee award. As such, the- district court’s fee award must be vacated.

REVERSED.

      . The Arizona Supreme Court incorporated seven factors from the Second Restatement of Torts § 767 to guide the analysis of the impropriety of an action: "(a) the nature of the actor's conduct, (b) the actor’s motive, (c) the interests of the other with which the actor’s conduct interferes, (d) the interests sought to be advanced by the actor, (e) the social interests in protecting the freedom of action of the actor and the contractual interests of the other, (f) the proximity or remoteness of the actor's conduct to the interference and (g) the relations between the parties.” Wagenseller, 147 Ariz. at 387, 710 P.2d 1025.

      . Restatement (Second) of Torts § 773 states: “One who, by asserting in good faith a legally protected interest of his own or threatening in good faith to protect the interest by appropriate means, intentionally causes a third person not to perform an existing contract or enter into a prospective contractual relation with another does not interfere improperly with the other’s relation if the actor believes that his interest may otherwise be impaired or destroyed by the performance of the contract or transaction.”

      . Indeed even Appellee-Plaintiffs counsel during trial referred to Wilson and Armfield as the county’s representatives to the MCAO: "... the representative of the County, including the Board of Supervisors, and high-level person in County government Sandi Wilson and the head of Risk Management Rocky Armfield all don't want you working on these Risk Management cases?”

      . Subsequent Arizona case - law explained: "An interest is 'legally protected’ within the meaning of Restatement § 773 if society recognizes the interest as so legitimate that everyone is under a duty not to invade it by interfering with its realization, and those who do so would be civilly liable to the possessor.” Strojnik v. Gen. Ins. Co. of Am., 201 Ariz. 430, 434, 36 P.3d 1200 (App. 2001). The relationship between a county and its legal counsel would certainly seem to satisfy this definition.

      . The content of Brandon's confidential mem-oranda to her client (leaked to the press by someone other than Brandon) obviously could not constitute citizen speech protected by the First Amendment as these memoranda were attorney work product that Brandon generated to aid her client in settling potential legal claims.


text:
    Lorraine BATES; Charles Ehrman Bates; Eileen Burke; Jaci Evans, as Successor Personal Representative for the Estate of Thomas Marier; and Dalla Francis, as Personal Representative for the Estate of George Alexander, Plaintiffs-Appellants, v. BANKERS LIFE AND CASUALTY COMPANY, an Illinois insurance company; CNO Financial Group, Inc., a Delaware corporation, Defendants-Appellees.
    No. 14-35397
    United States Court of Appeals, Ninth Circuit.
    Filed February 24, 2017
    D.C. No. 3:13-cv-00580-PK
    Rachele R. Selvig (argued) and Christopher L. Cauble, Cauble & Cauble LLP, Grants Pass, Oregon; Michael L. Williams and Leslie W. O’Leary, Williams O’Leary LLC, Portland, Oregon; for Plaintiffs-Appellants.
    Adam J. Kaiser (argued), Jeffrey J. Am-ato, and Matthew A. Stark, Winston & Strawn LLP, New York, New York; Ban Wurman, Winston <& Strawn LLP, Washington, D.C.; Vicki L. Smith, Lane Powell PC, Portland, Oregon; for Defendants-Appellants.
    Before: RICHARD R. CLIFTON, MARY H. MURGUIA, and JACQUELINE H. NGUYEN, Circuit Judges.
   ORDER

Pursuant to Oregon Revised Statutes § 28.200, we certify to the Oregon Supreme Court the following question:

Does a plaintiff state a claim under Oregon Revised Statutes § 124.110(l)(b) for wrongful withholding of money or property where it is alleged that an insurance company has in bad faith delayed the processing of claims and refused to pay benefits owed under an insurance contract?

The answer to this question will determine the outcome of this appeal. We find no controlling precedent in the decisions of the Oregon Supreme Court or intermediate appellate courts. We will adhere to the answer provided by the Oregon Supreme Court. We do not presume to bind the Oregon Supreme Court to our framing of this question of state law, and we recognize that the Oregon Supreme Court may, in its discretion, answer this question in any form that it chooses. If the Oregon Supreme Court declines certification, we will resolve the question according to our best understanding of Oregon law.

I.

Plaintiffs are elderly Oregonians or then-successors who purchased long-term healthcare insurance policies sold by Bankers Life and Casualty Company and its parent company, CNO Financial Group, Inc. (“Bankers”). These policies are designed to provide health services for elderly people who can no longer care for themselves and are intended to cover expenses for in-home care providers, assisted living facilities, and nursing homes.

Plaintiffs allege that Bankers developed onerous procedures to delay and deny insurance claims. Examples of these procedures include failing to answer phone calls, losing documents, delaying or denying claims without notifying policyholders, de-' nying claims for reasons that did not comport with Oregon law, and paying policyholders less than what they were owed under their policies. Bankers allegedly collected premium payments and, without good cause, delayed and denied insurance benefits to which Plaintiffs were entitled under their policies.

Plaintiffs brought suit in the District Court of Oregon, seeking damages and equitable relief. They asserted claims for breach of contract, intentional misconduct, fraud, and violations of Oregon’s financial abuse statute. Pursuant to Federal Rule of Civil Procedure 12(b)(6), the district court dismissed, inter alia, Plaintiffs’ financial abuse claim on the ground that Oregon’s financial abuse statute applies only in the “bailment or trust scenarios expressly referenced in the statutory language.” Bates v. Bankers Life & Cas. Co., 993 F.Supp.2d 1318, 1345 (D. Or. 2014).

On appeal, Plaintiffs challenge the dismissal of their claim under Oregon’s financial abuse statute. We now certify to the Oregon Supreme Court the question regarding the scope of Oregon’s financial abuse statute and ask the Court to exercise its discretion to accept and answer this question.

II.

Oregon ■ Revised Statutes §§ 124.100 through 124.140 establish a framework for bringing a civil action for abuse of a vulnerable person. The financial abuse statute states in relevant part:

(1) An action may be brought ... for financial abuse in the following circumstances:
(b) When a vulnerable person requests that another person transfer to the vulnerable person any money or property that the other person holds or controls and that belongs to or is held in express trust, constructive trust or resulting trust for' the vulnerable person, and the other person, without good cause, either continues to hold the money or property or fails to take reasonable steps to make the money or property readily available to the vulnerable person when:
(A) The ownership or control of the money or property was acquired in whole or in part by the other person or someone acting in concert with the other person from the vulnerable person; and
(B) The other person acts in bad faith, or knew or should have known of the right of the vulnerable person to have the money or property transferred as requested or otherwise made available to the vulnerable person.

Or. Rev. Stat. § 124.110. Plaintiffs contend that this statute allows them to recover the insurance benefits to which they are contractually entitled.

Plaintiffs argue that the statute is broad enough to encompass claims against insurance companies for benefits due under their insurance policies. A claim is actionable, they assert, when a person “continues to hold” or “fails to take reasonable steps” to make available the vulnerable person’s money or property. Id. at § 124.110(l)(b). Plaintiffs also contend that the statute imposes liability as long as the defendant “acts in bad faith, or knew or should have known of the right of the vulnerable person to have the money or property transferred as requested.” Id. at § 124.110(l)(b)(B). In addition to the text of the statute, Plaintiffs rély on a statutory list of exempted institutions that does not include insurance companies, Or. Rev. Stat. § 124.115, the 1999 expansion of the financial abuse statute, 1999 Or. Laws, ch. 305, and federal district court decisions construing California’s financial abuse statute, see Rosove v. Cont’l Cas. Co., No. 14-CV-01118, 2014 WL 2766161, at *5 (C.D. Cal. June 2, 2014); Johnston v. Allstate Ins. Co., No. 13-CV-574, 2013 WL 2285361, at *4 (S.D. Cal. May 23, 2013).

Bankers on the other hand argues that the scope of Oregon’s financial abuse statute, by its plain language, does not include claims against insurance companies for benefits. Bankers focuses on the language, “acquired in whole or in part ... from the vulnerable person,” to argue that the statute does not cover typical sales or services transactions. Or. Rev. Stat. § 124.110; see also Hoffart v. Wiggins, 226 Or.App. 545, 204 P.3d 173, 175 (2009). Bankers reasons that the vulnerable person is limited to a return of the same money or property that the insurer acquired from that vulnerable person, as in a bailment or trust scenario. In addition to the text of the statute, Bankers relies on the elements of a claim for financial abuse set forth in Hoffart v. Wiggins, 204 P.3d at 175.

Without guidance from the Oregon Supreme Court or any Oregon appellate court, we are not confident of the correct interpretation of Oregon’s financial abuse statute. While the statute’s legislative history suggests that the statute may be applied to contractual relationships, it does not shed light on whether the statute’s breadth encompasses the wrongful withholding of insurance benefits owed under a policy. See Wyers v. Am. Med. Response Nw., Inc., 360 Or. 211, 377 P.3d 570, 580 (2016); Abuse of the Elderly and Incapacitated: Hearing on S.B. 6 Before the H. Comm, on Judiciary, 1999 Leg., 70th Sess., Tape 166, Side A (Or. 1999) (statement of Rep. Lane Shetterly). Because the resolution of this case turns solely on Oregon law, we can only predict how the Oregon Supreme Court would rule. See Patton v. Target Corp., 580 F.3d 942, 948 (9th Cir. 2009). Therefore, we certify this question of law to the Oregon Supreme Court so that we, as well as the Oregon bar, might benefit from an authoritative decision on this issue. See id.

III.

In an opinion published concurrently with this order, we resolved a separate question of whether our court has jurisdiction to review the district court’s decision to strike the class allegations. All other further proceedings in this case are stayed pending receipt of the answer to the certified question or notification by the Oregon Supreme Court that it declines to answer the certified question. The parties shall notify this court within ten days after the Oregon Supreme Court accepts or rejects certification. In the event that the Oregon Supreme Court accepts certification, the parties shall file a joint status report with this court six months after the date of acceptance and every six months thereafter, or within ten days of the Oregon Supreme Court’s decision, whichever is earlier.

The Clerk shall file a certified copy of this order with the Oregon Supreme Court under Oregon Revised Statutes § 28.215. The Clerk shall also provide a copy of the record in this case, in whole or in part, to the Oregon Supreme Court upon request.

IT IS SO ORDERED.

      . Although Plaintiffs had alleged that Bankers induced them to enter into their long-term healthcare policies, Plaintiffs have abandoned that theory and expressly do not pursue a fraudulent inducement or wrongful taking of premiums claim under subsection (l)(a) of Oregon Revised Statutes 124.110. Plaintiffs press only a wrongful withholding of money or property claim under subsection (l)(b) on the basis of Bankers’ bad faith denial and delay of insurance claims.


author: MURGUIA, Circuit Judge:

text:
    COMPASSION OVER KILLING, a non-profit organization; Animal Legal Defense Fund, a non-profit organization; Elizabeth Barrett; Andrea Bock; Linda Calbreath; Jason Canada; Jeri Opalk; Humberto Retana, Plaintiffs-Appellants, v. U.S. FOOD & DRUG ADMINISTRATION; Margaret Hamburg, M.D., Commissioner; Agriculture Marketing Service; David R. Shipman, Administrator; Food Safety and Inspection Service; Alfred V. Almanza, Administrator; Federal Trade Commission; Edith Ramirez, Chairwoman, Defendants-Appellees.
    No. 15-15107
    United States Court of Appeals, Ninth Circuit.
    Argued and Submitted December 14, 2016, San Francisco, California
    Filed February 27, 2017

      Monte M.F. Cooper (argued), Orrick Herrington & Sutcliffe LLP, Menlo Park, California; Karen G. Johnson-McKewan, Orrick Herrington & Sutcliffe LLP, San Francisco, California; for Plaintiffs-Appellants.
    Jeffrey E. Sandberg (argued) and Mark B. Stern, Attorneys, Appellate Staff; Brian Stretch, Acting United States Attorney; Benjamin C. Mizer, Principal Deputy Assistant Attorney General; Civil Division, United States Department of Justice, Washington, D.C.; for Defendants-Appel-lees.
    Before: MICHAEL DALY HAWKINS, MARSHA S. BERZON, and MARY H. MURGUIA, Circuit Judges.
   OPINION

MURGUIA, Circuit Judge:

Plaintiffs Compassion Over Killing, the Animal Legal Defense Fund, and six individual egg consumers submitted rule-making petitions to Defendants U.S. Food and Drug Administration (“FDA”), Federal Trade Commission (“FTC”), Agricultural Marketing Service (“AMS”), and Food Safety and Inspection Service (“FSIS”), requesting that each agency promulgate regulations that would require all egg cartons to identify the conditions in which the egg-laying hens were kept during production. Each agency denied Plaintiffs’ rule-making petition. Plaintiffs initiated the underlying lawsuit claiming that each agency had acted arbitrarily and capriciously in dismissing their rulemaking petitions. The district court concluded that Defendants had each acted reasonably in denying Plaintiffs’ petitions and granted summary judgment in favor of Defendants. We have jurisdiction pursuant to 28 U.S.C. § 1291, and we affirm.

I.

Plaintiffs submitted similar rulemaking petitions to the FDA, FTC, AMS, and FSIS requesting that each agency “take regulatory action to revise the current labeling requirements for eggs at [21 C.F.R. §§ 101, 115, 160], and/or to promulgate new regulations” that would require all egg cartons to identify the conditions in which the egg-laying hens were kept during production. The petitions specifically proposed that each agency develop regulations that would require all egg cartons to bear the labels “Free-Range Eggs,” “Cage-Free Eggs,” or “Eggs from Caged Hens,” consistent with the living conditions of the hens. In support of the proposed regulations, Plaintiffs argued that there is a strong consumer interest in buying eggs that are produced in cage-free environments. Plaintiffs also argued that, without the proposed regulations, consumers are being misled by certain statements and images on egg cartons that imply that the hens are being raised in cage-free environments. Plaintiffs provided several examples of various egg labels that present images of uncaged hens and contain phrases such as “all natural” or “animal friendly,” arguing that these images and phrases likely mislead a consumer to believe that the hens are not being raised in cages. Plaintiffs also maintained that their proposed regulations are necessary because eggs from caged hens are nutritionally inferior to and carry a greater risk of Salmonella contamination than eggs from free-range hens.

Each agency denied Plaintiffs’ petition for rulemaking. The FSIS and AMS explained that they could not promulgate the proposed regulations because they lacked the authority to take the requested action. The FTC explained that, based on the information Plaintiffs provided in the petition, it could not conclude that current egg-labeling practices were either “unfair or deceptive.” The FTC also concluded that the petition had not sufficiently demonstrated that any misleading practice was “prevalent,” as statutorily required for rulemaking. Lastly, the FTC explained that the agency’s resources would be better used by combating any potentially deceptive practices through individual enforcement actions, rather than by promulgating new regulations.

The FDA denied Plaintiffs’ request for rulemaking because it determined that Plaintiffs had failed to show that current egg labels omitted a “material” fact by not indicating the living conditions of the egg-laying hens. The FDA specifically explained that it could not determine that this information was material because Plaintiffs had not provided persuasive evidence that eggs from caged hens are either less nutritious or more likely to be contaminated with Salmonella than eggs from uncaged hens. The FDA also explained that consumer interest in the hens’ living conditions, alone, is insufficient to establish that egg-production methods are a material fact that would permit the FDA to issue the requested regulations. Lastly, the FDA stated that it declined to promulgate the proposed labeling regulations because it could bring individual enforcement actions against any misbranded eggs, and “it would choose to use its limited' resources on rulemakings of higher priority, such as those that are of greatest public health significance or are statutorily-mandated.”

Plaintiffs filed this lawsuit, alleging that the FSIS, AMS, FTC, and FDA had each acted arbitrarily and capriciously in dismissing their rulemaking petitions. Plaintiffs moved for summary judgment, and Defendants filed a cross-motion for summary judgment, arguing that each agency had acted reasonably in denying Plaintiffs’ rulemaking requests. The district court granted summary judgment for Defendants. Plaintiffs timely appealed.

II.

This Court reviews challenges to final agency action decided on summary judgment de novo and pursuant to Section 706 of the Administrative Procedure Act (“APA”). Turtle Island Restoration Network v. Nat’l Marine Fisheries Serv., 340 F.3d 969, 973 (9th Cir. 2003). The APA requires the Court to “hold unlawful and set aside agency action, findings, and conclusions found to be ... arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C.' § 706(2). When an agency refuses to exercise its discretion to promulgate proposed regulations, the Court’s review “is ‘extremely limited’ and ‘highly deferential.’ ” Massachusetts v. EPA, 549 U.S. 497, 527-28, 127 S.Ct. 1438, 167 L.Ed.2d 248 (2007) (quoting Nat’l Customs Brokers & Forwarders Ass’n of Am., Inc. v. United States, 883 F.2d 93, 96 (D.C. Cir. 1989)); see also Nat’l Mining Ass’n v. Mine Safety & Health Admin., 599 F.3d 662, 667 (D.C. Cir. 2010) (stating that an “ ‘agency’s refusal to institute rulemaking proceedings is at the high end of the range’ of levels of deference we give to agency action under our ‘arbitrary and capricious’ review” (quoting Defenders of Wildlife v. Gutierrez, 532 F.3d 913, 919 (D.C. Cir. 2008))).

A.

Plaintiffs argue that the FSIS acted arbitrarily and capriciously by denying their rulemaking petition based on the agency’s conclusion that it lacks the authority to promulgate the proposed regulations. Plaintiffs specifically argue that the FSIS has'the authority to regulate the labeling of shell eggs under the Egg Products Inspection Act (“EPIA”), 21 U.S.C. §§ 1031-56.

The FSIS correctly concluded that it lacks the authority to promulgate Plaintiffs’ proposed labeling regulations for shell .eggs. The EPIA expressly distinguishes between the terms “egg products” and “eggs,” and grants broad authority to the FSIS to regulate the labeling only of “egg products.” See 21 U.S.C. § 1036(a) (stating that the FSIS may promulgate regulations mandating the disclosure of information “to assure that [egg products] will not have false or misleading labeling”); see also id. § 1033(f) (defining “egg product” as “any dried, frozen, or liquid eggs, with or without added ingredients, excepting products which contain eggs only in a relatively small proportion”); id. § 1033(g) (defining “egg” as “the shell egg of the domesticated chicken, turkey, duck, goose, or guinea”). Because Plaintiffs’. proposed labeling regulations concern only shell eggs, they fall outside of the FSIS’s labeling jurisdiction under the EPIA. Accordingly, we conclude that the FSIS did not act arbitrarily or capriciously in denying Plaintiffs’ rulemaking petition.

B.

Plaintiffs also argue that the AMS acted arbitrarily and capriciously in denying their rulemaking petition based on the agency’s conclusion that it lacks the authority to promulgate mandatory labeling regulations. Plaintiffs maintain that the AMS has the authority to issue their proposed regulations under the Agricultural Marketing Act of 1946 (“AMA”), 7 U.S.C. §§ 1621 — 39j.

The AMS correctly concluded that it lacks the authority to promulgate mandatory labeling requirements for shell eggs. The relevant grant of authority in the AMA only authorizes the AMS “[t]o develop and improve standards of quality, condition, quantity, grade, and packaging, and recommend and demonstrate such standards in order to encourage uniformity and consistency in commercial practices.” 7 U.S.C. § 1622(c) (emphasis added). There is no indication from this statutory language that Congress intended to authorize the AMS to promulgate mandatory labeling requirements for all shell eggs. Further, although Plaintiffs correctly note that the AMS has previously developed voluntary programs related to food labels, these programs do not demonstrate that the AMS has the authority to promulgate the mandatory regulations Plaintiffs sought. See, e.g., Regulations Governing the Voluntary Grading of Shell Eggs, 7 C.F.R..pt. 56. We therefore conclude that the AMS also did not act arbitrarily or capriciously in denying Plaintiffs’' rulemaking petition because the agency correctly concluded that it lacks the authority to promulgate mandatory labeling requirements for shell eggs.

C.

Plaintiffs argue that the FTC acted arbitrarily and capriciously by denying their rulemaking petition without completing an appropriately substantive analysis of the petition. Plaintiffs also argue that, because the FTC did not appropriately review the rulemaking petition, the agency should not be permitted to exercise its discretion to address any misleading egg labeling through ad hoc enforcement actions.

The Federal Trade Commission Act (“FTCA”), 15 U.S.C. §§ 41-58, authorizes the FTC to prescribe “rules which define with specificity acts or practices which are unfair or deceptive” and “requirements ... for the purpose of preventing such acts or practices.” 15 Ú.S.C. § 57a(a)(l)(B). The FTC may initiate such rulemaking proceedings, however, “only where it has reason to believe that the unfair or deceptive acts or practices ... are prevalent.” Id. § 57a(b)(3). The FTCA states that an act or practice is “prevalent” if the FTC has previously issued cease- and-desist orders regarding the act or practice, or if “any other information available to the [FTC] indicates a widespread pattern of unfair or deceptive acts or practices.” Id. § 57a(b)(3)(A)-(B).

In its letter denying Plaintiffs’ petition, the FTC explained that it could not conclude that the potentially unfair or deceptive labeling practices Plaintiffs challenge are “prevalent” as that term is used in the FTCA. The FTC specifically concluded, and Plaintiffs do not dispute, that the agency has not issued any cease-and-desist orders concerning the egg-labeling practices identified in their petition. The FTC also reasonably concluded that Plaintiffs had submitted insufficient evidence to establish that any potentially unfair or deceptive egg-labeling practices were “widespread.” While Plaintiffs submitted isolated examples of potentially misleading egg labels and survey evidence concerning consumer confusion over the word “natural,” Plaintiffs have not identified any evidence submitted to the FTC tending to indicate that such practices were sufficiently widespread to justify promulgating their proposed regulations. In light of the limited evidence before the FTC showing any “prevalent” unfair or deceptive practices, the FTC’s decision to deny Plaintiffs’ petition on this basis was reasonable. See Massachusetts, 549 U.S. at 533, 127 S.Ct. 1438 (requiring a “reasonable explanation as to why [an agency] cannot or will not exercise its discretion” to decline rulemaking).

The FTC also reasonably denied Plaintiffs’ rulemaking petition based on its discretion to combat any potentially misleading egg labeling through ad hoc enforcement proceedings. See SEC v. Chenery Corp., 332 U.S. 194, 203, 67 S.Ct. 1760, 91 L.Ed. 1995 (1947) (“[T]he choice made between proceeding by general rule or by individual, ad hoc litigation is one that lies primarily in the informed discretion of the administrative agency.”)- Here, the FTC explained that it has been successful in pursuing individual enforcement efforts concerning misleading shell egg labeling in the past. Further, the FTC considered its “limited ... resources” and explained that, in light of the numerous statutory requirements for rulemaking under the FTCA, the “resource commitment necessary to adopt a rule” similar to what Plaintiffs requested “would be considerable:” These considerations provide a separate, reasonable basis for denying Plaintiffs’ rulemak-ing request that is also sufficient to withstand judicial review. See Massachusetts, 549 U.S. at 527, 127 S.Ct. 1438 (“[A]n agency has broad discretion to choose how best to marshal its limited resources and personnel to carry out its delegated responsibilities.”). We therefore conclude that the FTC did not act arbitrarily or capriciously in denying Plaintiffs’ rulemak-ing petition.

D.

Plaintiffs argue that the FDA acted arbitrarily and capriciously in denying their rulemaking petition because the agency failed to consider their claims that egg cartons are widely misbranded not only because their labels omit material information, but also because current labeling practices affirmatively misrepresent the nature of the hens’ living conditions. PlainTiffs also argue that the FDA improperly rejected their scientific evidence that the egg-laying hens’ living conditions increase the risk of Salmonella-contamination and negatively affect the nutritional value of the eggs. Lastly, Plaintiffs contend that because the FDA failed to appropriately review their petition, the agency should not be permitted to summarily exercise its discretion to prioritize other agency goals in order to avoid addressing Plaintiffs’ request for rulemaking.

The Federal Food, Drug, and Cosmetic Act (“FDCA”), 21 U.S.C. §§ 301-399f, prohibits the sale of misbranded food items. See 21 U.S.C. §§ 331(a). The FDA possesses discretionary authority to “promulgate regulations for the efficient enforcement of [the FDCA].” Id. § 371(a). Under the FDCA a food item is “misbranded” if its label “is false or misleading in any particular.” Id. § 343(a)(1). Food labeling may be misleading through affirmative representations or through an omission of a material fact. See id. § 321(n).

To the extent Plaintiffs’ petition argued that egg production methods were an omitted material fact that required disclosure because the hens’ living conditions affect the likelihood of Salmonella-contamination or the nutritional value of the eggs, the FDA explained that Plaintiffs had provided insufficient reliable scientific evidence to support these claims. While Plaintiffs dispute the FDA’s decision to reject their scientific evidence, the Court will not second guess the FDA’s conclusion that these studies were insufficiently reliable, largely because they failed to control for relevant variables. See N. Plains Res. Council, Inc. v. Surface Transp. Bd., 668 F.3d 1067, 1075 (9th Cir. 2011) (“A court generally must be ‘at its most deferential’ when reviewing scientific judgments and technical analyses within the agency’s expertise.” (quoting Balt. Gas & Elec. Co. v. Nat. Res. Def. Council, Inc., 462 U.S. 87, 103, 103 S.Ct. 2246, 76 L.Ed.2d 437 (1983))).

To the extent Plaintiffs’ petition argued that egg-production methods were an omitted material fact that required disclosure in light of misleading affirmative representations that appear on egg cartons, the FDA explained that it could bring individual enforcement actions against any such misbranded food, as it has done in the past. The FDA also detailed its competing priorities given its limited resources and explained it had determined that, even if certain egg-labeling practices are misleading, proposed rulemaking was not the best use of its limited resources.

The decision to take enforcement action against misbranded eggs on a case-by-case basis, as opposed to promulgating regulations that would apply to all egg producers, is left to the broad discretion of the FDA. See Chenery Corp., 332 U.S. at 203, 67 S.Ct. 1760. Similarly, the agency’s decision to prioritize other projects is entitled to great deference by a reviewing court. See Massachusetts, 549 U.S. at 527, 127 S.Ct. 1438; see also In re Barr Labs., Inc., 930 F.2d 72, 76 (D.C. Cir. 1991) (“[W]e have no basis for reordering [the FDA’s] priorities. The agency is in a unique — and authoritative — position to view its projects as a whole, estimate the prospects for each, and allocate its resources in the optimal way.”).

We note, however, that such broad discretion should not be construed as providing a blanket exception to APA review in any matter involving the allocation of agency resources. See WWHT, Inc. v. F.C.C., 656 F.2d 807, 814 (D.C. Cir. 1981) (“[W]e reject the suggestion that agency denials of requests for rulemaking are exempt from judicial review.”). In denying a petition for rulemaking, an agency must, at a minimum, clearly indicate that it has considered the potential problem identified in the petition and provide a “reasonable explanation as to why it cannot or will not exercise its discretion” to initiate rule-making. Massachusetts, 549 U.S. at 533, 127 S.Ct. 1438; Ctr. for Biological Diversity v. U.S. Fish & Wildlife Serv., 807 F.3d 1031, 1042-43 (9th Cir. 2015) (stating that an agency action is considered “arbitrary and capricious” if the agency has “entirely failed to consider an important aspect of the problem” (quoting Pac. Coast Fed’n of Fisherman’s Ass’ns v. Nat’l Marine Fisheries Serv., 265 F.3d 1028, 1034 (9th Cir. 2001))).

Here, the FDA’s explanation for denying Plaintiffs’ rulemaking petition barely meets this low burden. The FDA could have better addressed Plaintiffs’ evidence of misleading representations that appear on egg cartons to demonstrate that the agency fully appreciated one of the primary bases for Plaintiffs’ rulemaking petition — that information concerning egg-laying hens’ living conditions is necessary in order to correct the affirmative representations that frequently appear on egg labels and convey misleading information. The FDA’s denial letter, however, reflects that the agency did consider Plaintiffs’ evidence of affirmative misrepresentations that appear on egg labels but ultimately decided that individual enforcement actions would be preferable to promulgating the proposed regulations. Because the FDA is generally free to choose its procedural mode of administration and prioritize agency goals, we see no reason to remand the matter to the FDA to reconsider Plaintiffs’ petition in this case.

III.

For the reasons stated above, the FSIS, AMS, FTC, and FDA each acted reasonably in denying Plaintiffs’ rulemaking petitions. Accordingly, we affirm the district court’s grant of summary judgment to Defendants.

AFFIRMED.

      . We grant Plaintiffs’ request for judicial notice of documents that were omitted from the administrative record (Doc. No. 50). See Fed. R. App. P. 10(e)(2)(C).
      We deny Plaintiffs’ request for judicial notice of two recent newspaper articles (Doc. No. 67). These articles were not part of the administrative record on which the agencies based their decisions to deny Plaintiffs’ rule-making petitions, and Plaintiffs have not "met [their] heavy burden to show that the additional materials ... are necessary to adequately review" the agencies’ decisions. See Fence Creek Cattle Co. v. U.S. Forest Serv., 602 F.3d 1125, 1131 (9th Cir. 2010).


author: WATFORD, Circuit Judge:

text:
    Gary RAMSEY, Plaintiff-Appellee, v. Esther L. MUNA, individually and in her official capacity as CEO of the Commonwealth Healthcare Corporation; Jeanolivia Grant, individually and in her official capacity as Chief of the OB/GYN Department, Commonwealth Healthcare Corporation; Sherleen Osman, individually and in her official capacity as Director of Medical Affairs, Commonwealth Healthcare Corporation; Joseph Kevin Villagomez; Commonwealth Healthcare Corporation; Commonwealth of the Northern Mariana Islands, Defendants-Appellants, and Does 1-10, Defendants.
    No. 15-16309
    United States Court of Appeals, Ninth Circuit.
    Argued and Submitted October 18, 2016, Honolulu, Hawaii
    Filed February 28, 2017
    James M. Zarones (argued), Chief Solicitor Division, Office of the Attorney General, Saipan, Commonwealth of the Northern Mariana Islands, for Defendants-Appellants.
    Stephen C. Woodruff (argued), Saipan, Commonwealth of the Northern Mariana Islands, for Plaintiff-Appellee.
    Before: J. CLIFFORD WALLACE, JEROME FARRIS, and PAUL J. WATFORD, Circuit Judges.
   OPINION

WATFORD, Circuit Judge:

This is an action against the Commonwealth of the Northern Mariana Islands and one of its agencies, brought by a doctor who used to work at the public hospital on Saipan. (The case also involves claims against certain individual defendants, but those claims are not before us.) The plaintiff alleges that the Commonwealth and the public corporation that runs the hospital wrongfully denied him privileges at the hospital. As relevant here, he asserts contract and tort claims under Commonwealth law; his claims under federal law were dismissed on grounds not at issue in this appeal. The defendants moved to dismiss the contract and tort claims on the basis of sovereign immunity. The district court reluctantly denied the motion, believing itself bound by our decision in Fleming v. Department of Public Safety, 837 F.2d 401 (9th Cir. 1988). We have jurisdiction to hear the Commonwealth’s interlocutory appeal challenging the denial of sovereign immunity. See Del Campo v. Kennedy, 517 F.3d 1070, 1074 (9th Cir. 2008).

In Fleming, we held that the Commonwealth does not enjoy sovereign immunity in federal court with respect to claims brought under federal law. 837 F.2d at 407-08. We reached that conclusion after examining the foundational document that created the Commonwealth, known as the Covenant to Establish a Commonwealth of the Northern Mariana Islands in Political Union with the United States of America. See 48 U.S.C. § 1801 (setting out the text of the Covenant). Although the Covenant does not explicitly address sovereign immunity, we concluded that a waiver of •immunity could be inferred from one of its provisions, § 501(a). That section states: “To the extent that they are not applicable of their own force, the following provisions of the Constitution of the United States will be applicable within the Northern Mariana Islands as if the Northern Mariana Islands were one of the several States.... ” Section 501(a) then lists roughly two dozen provisions of the United States Constitution. Absent from that list .is the Eleventh Amendment, which recognizes States’ immunity from private suits in federal court. See Hans v. Louisiana, 134 U.S. 1, 15, 10 S.Ct. 504, 33 L.Ed. 842, (1890). We held that the omission of the Eleventh Amendment signaled an intention to waive the Commonwealth’s sovereign immunity in federal court with respect to claims arising under federal law. Fleming, 837 F.2d at 407.

We found confirmation of this implied waiver in the Section by Section Analysis of the Covenant to Establish a Commonwealth of the Northern Mariana Islands (1975), an authoritative source of the Covenant’s legislative history prepared by the Marianas Political Status Commission. Id. at 408. The Section by Section Analysis states that the Covenant provides the people of the Northern Mariana Islands with the right to local self-government under a constitution of their own making, thereby ensuring that the “Northern Mariana Islands government will be an independent government, like that of the states.” Sec-tion by Section Analysis, p. 11. As a consequence, “the Government of the Northern Mariana Islands will have sovereign immunity, so that it cannot be sued on the basis of its oum laws without its consent.” Id. (emphasis added). We concluded that this reference to sovereign immunity, limited to claims arising under the Commonwealth’s own laws, supplied “persuasive evidence” that the drafters of the Covenant intended to waive the Commonwealth’s sovereign immunity with respect to claims arising under federal law. Fleming, 837 F.2d at 408.

We hold that Fleming does not control the outcome in this case. Fleming held only that the Commonwealth waived its sovereign immunity with respect to “suits in federal court arising under federal law.” Id. at 407. The court did not have occasion to say whether the Commonwealth also waived its sovereign immunity with respect to claims arising under Commonwealth law, for no such claims were at issue there. What the court suggested on that subject, based on the statement in the Section by Section Analysis quoted above, is that the Commonwealth did not waive its immunity from suit with respect to claims arising under its own laws.

Confronting the waiver issue as a matter of first impression, we agree with the suggestion in Fleming that the Commonwealth retained its sovereign immunity with respect to claims arising under Commonwealth law. That conclusion is dictated by two lines of Supreme Court precedent.

In the first line, the Supreme Court held that Puerto Rico and Hawaii, both United States territories at the time, enjoyed sovereign immunity from suits arising under their own laws. People of Porto Rico v. Rosaly y Castillo, 227 U.S. 270, 273-74, 33 S.Ct. 352, 57 L.Ed. 507 (1913); Kawananakoa v. Polyblank, 205 U.S. 349, 353, 27 S.Ct. 526, 51 L.Ed. 834 (1907). The Court held that each territory had been granted the power to enact its own laws and thus enjoyed a level of autonomy similar to that of the States. Sovereign immunity barred suits arising under their own laws because, absent consent, “there can be no legal right against the authority that makes the law on which the right depends.” Kawananakoa, 205 U.S. at 353, 27 S.Ct. 526.

The same rule applies with equal force to the Commonwealth. Like territorial Hawaii and Puerto Rico, the Commonwealth' has the power to enact its own laws and indeed enjoys an even greater level of legislative autonomy than Hawaii and Puerto Rico did back then. Puerto Rico’s Organic Act provided that the federal government could unilaterally annul any laws the territory enacted. Foraker Act, ch. 191, § 31, 31 Stat. 77, 83 (1900). Hawaii’s Organic Act authorized Congress to repeal or amend any of the laws that remained in force from the territory’s time as an independent republic, and granted the territory’s governor, an appointee of the federal government, the right to veto bills passed by the local legislature. Act of Apr. 30, 1900, ch. 339, §§ 6, 49, 66, 31 Stat. 141, 142, 149, 153. The Commonwealth’s government, by contrast, was established by the Covenant and its own constitution, not by an Organic Act passed by Congress, and the federal government does not possess a similar veto authority with respect to laws enacted by the Commonwealth’s legislature. See Covenant §§ 105, 203. Thus, if Hawaii and Puerto Rico enjoyed sovereign immunity with respect to claims brought under their own laws, it is even clearer that the Commonwealth enjoys sovereign immunity with respect to claims arising under its own laws.

In the second line of precedent, the Supreme Court has held, perhaps at odds with our reasoning in Fleming, that a waiver of a State’s sovereign immunity must be unequivocal. Pennhurst State School & Hospital v. Halderman, 465 U.S. 89, 99, 104 S.Ct. 900, 79 L.Ed.2d 67 (1984). That means a waiver will be found “only where stated by the most express language or by such overwhelming implications from the text as [will] leave no room for any other reasonable construction.” Edelman v. Jordan, 415 U.S. 651, 673, 94 S.Ct. 1347, 39 L.Ed.2d 662 (1974) (internal quotation marks omitted).

The Covenant does not expressly waive the Commonwealth’s immunity from suits arising under its own laws, and we do not think the mere omission of the Eleventh Amendment from § 501(a) gives rise to “overwhelming implications” that such a waiver was intended. Indeed, as the court stated in Fleming, all evidence points in the opposite direction. Most significantly, the Section by Section Analysis indicates that the drafters of the Covenant believed the Commonwealth would be entitled to sovereign immunity when sued on the basis of its own laws. The drafters likely viewed inclusion of the Eleventh Amendment in § 501(a) as unnecessary to secure such immunity, given the long line of authority holding that a State’s immunity from private suits is an inherent aspect of sovereignty, not a principle derived solely from the Eleventh Amendment. Principality of Monaco v. Mississippi, 292 U.S. 313, 322-23, 54 S.Ct. 745, 78 L.Ed. 1282 (1934); Hans, 134 U.S. at 12-13, 10 S.Ct. 504; see also Alden v. Maine, 527 U.S. 706, 713, 119 S.Ct. 2240, 144 L.Ed.2d 636 (1999). In addition, as noted above, the Covenant created a commonwealth with at least as much sovereign autonomy as territorial Hawaii and Puerto Rico, both of which enjoyed sovereign immunity by virtue of the fact that they possessed the power to enact their own laws. In the face of this equally reasonable explanation for the Eleventh Amendment’s omission from § 501(a), we cannot construe that omission as effecting a waiver of the Commonwealth’s immunity from suits arising under its own laws.

Although the Covenant itself does not contain an express waiver of sovereign immunity, the Commonwealth has enacted a statute that waives its immunity with respect to a limited set of claims arising under Commonwealth law. However, that statute provides that the Commonwealth’s own courts “shall have exclusive original jurisdiction” to hear such claims. 7 C.M.C. § 2251. The Supreme Court has held that a provision of this sort does not suffice to waive a State’s immunity from suit in federal court. Instead, the statute or constitutional provision purporting to waive sovereign immunity must “specifically indicate the State’s willingness to be sued in federal court.” Atascadero State Hospital v. Scanlon, 473 U.S. 234, 241, 105 S.Ct. 3142, 87 L.Ed.2d 171 (1985). Section 2251 indicates precisely the opposite — that the Commonwealth is willing to be * sued in certain circumstances, but not in federal court.

In short, we hold that the Commonwealth may not be sued without its consent on claims arising under its own laws. On remand, the district court is directed to grant the Commonwealth’s motion to dismiss the claims at issue in this appeal.

REVERSED and REMANDED.