City of South Bend v. Tim Corbett, et al
Filing
Filed opinion of the court by Judge Easterbrook. The judgment of the district court is VACATED, and the case is REMANDED with instructions to dismiss the complaint. The state court now is free to resolve the underlying disputeon its own, without regard to the vacated federal judgment. Joel M. Flaum, Circuit Judge; Frank H. Easterbrook, Circuit Judge and Ann Claire Williams, Circuit Judge. [6858162-1] [6858162] [15-3315, 15-3385]
Case: 15-3315
Document: 67
Filed: 08/01/2017
Pages: 9
In the
United States Court of Appeals
For the Seventh Circuit
____________________
Nos. 15-3315 & 15-3385
CITY OF SOUTH BEND, INDIANA,
Plaintiff-Appellee,
v.
SOUTH BEND COMMON COUNCIL,
Defendant-Appellee, Cross-Appellant,
and
TIM CORBETT, et al.,
Defendants-Appellants, Cross-Appellees.
____________________
Appeals from the United States District Court for the
Northern District of Indiana, South Bend Division.
No. 3:12-CV-475 JVB — Joseph S. Van Bokkelen, Judge.
____________________
ARGUED OCTOBER 26, 2016 — DECIDED AUGUST 1, 2017
____________________
Before FLAUM, EASTERBROOK, and WILLIAMS, Circuit Judges.
EASTERBROOK, Circuit Judge. The caption of this case says
much of what is necessary to its resolution: the City of South
Bend, Indiana, is suing one of its constituent parts.
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As a matter ordinary business, South Bend’s Police Department (part of the City rather than a distinct juridical entity) records some of the desk phones supplied to officers as
official equipment at its headquarters. In 2005 Rick Bishop,
then a Captain in the Risk Management Bureau, asked that
his phone be added to those being recorded, and this was
done. The line’s phone number does not matter; we call it
the Line. In February 2010 Steve Richmond took Bishop’s
former position and office. Richmond wanted to keep his old
phone number, so the Line was switched to the office of the
Captain of the Investigative Division, which was vacant at
the time. In March 2010 Brian Young was promoted to that
job. Young did not know that the phone in his new office
was among those being recorded. It is unclear who did
know in 2010; once recording began in 2005, no one appears
to have given the subject further thought.
In February 2011 the recording system crashed and had
to be restored from a backup. While listening to some recordings to make sure that this had been done correctly, Karen DaPaepe, the Police Department’s Director of Communications, heard Young say things that she thought inappropriate. This was reported up the chain of command, and in
December 2011 the Chief of Police (Darryl Boykins) asked
DaPaepe to give him recordings of the most troubling calls.
DaPaepe gave the Chief cassette tapes of calls Young had
made on eight dates in 2011. Apparently knowledge of the
recordings’ existence and contents went beyond Boykins;
other persons whose voices had been recorded on the Line
became concerned. Boykins used some of the information to
threaten Richmond. Federal and state officials launched investigations, which ended without charges being filed.
Boykins was demoted; DaPaepe was fired. And the Com-
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mon Council (the City’s legislature) demanded access to the
tapes. When the Police Department demurred, the legislators
issued a subpoena to the City’s executive officials and applied to state court for its enforcement.
The City believes that complying with the subpoena
would violate federal wiretap statutes. See 18 U.S.C.
§§ 2510–22. Not content with the prospect of interposing a
federal defense to the subpoena, the City of South Bend filed
this federal suit, seeking a declaratory judgment that disclosure of the recordings would violate §2511(1)(c). A federal
defense to a claim arising under state law does not permit
the suit’s removal. See, e.g., Aetna Health Inc. v. Davila, 542
U.S. 200 (2004) (discussing the rule and its exceptions, such
as complete preemption). The City tried to sidestep this rule,
and obtain a decision on an isolated federal issue, through
the declaratory-judgment process. For good measure the
City sued Young, Richmond, and three other persons, contending that it should be declared not liable to any of them.
They filed their own suit seeking damages from the City.
The district court consolidated the two suits.
The district court ruled that it had subject-matter jurisdiction despite the fact that the suit had been filed to present a
federal defense to a state suit rather than a stand-alone federal claim. Normally the Declaratory Judgment Act, 28
U.S.C. §2201, cannot be used to present a federal defense to
state litigation. But before the Common Council moved to
dismiss the action, the five individual defendants in the
City’s suit had become plaintiffs in their own suit, seeking
damages based directly on federal statutes. This supplied
jurisdiction, the district court concluded, even though the
City’s original complaint did not. 2013 U.S. Dist. LEXIS 5192
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(N.D. Ind. Jan. 14, 2013). In effect, the district court treated
the second suit, consolidated with the City’s, as the jurisdictional footing for both suits, with the original dispute between the City’s legislative and executive branches along for
the ride under the supplemental jurisdiction of 28 U.S.C.
§1367.
After a bench trial, the judge concluded that recordings
through February 4, 2011, had been lawful because Captain
Bishop had consented in 2005 and no one with authority
over the recording system recognized that Captain Young
had started using the Line in March 2010. Lawfully made
recordings may be disclosed, the judge added. But once
DaPaepe learned that Young was using the Line, recording
became unlawful—and because the recordings were unlawful, their distribution, even in response to a state subpoena,
would be unlawful. The district court rejected the Common
Council’s reliance on 18 U.S.C. §2510(5)(a)(ii), which permits
the recording of any line “being used by … an investigative
or law enforcement officer in the ordinary course of his duties”. The judge based his finding of illegality principally on
§2511(1)(a), which forbids the intentional interception of a
call in the absence of a statutory justification. The district
court treated the intent element as related to knowledge of
whose voice would be heard rather than knowledge of
which line would be recorded, but the judge did not explain
why the statutory word “intentionally” refers to the identities of the parties to a call.
We have cross-appeals. The Common Council asks us to
hold that all of the recordings may be disclosed and the individual parties that none may be. The City did not appeal
but also does not defend the judgment in full. It asks us to
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hold, contrary to the district court, that the recordings on
February 4, 2011, are unlawful. The City does not discuss the
venerable rule that only a party that has filed a timely appeal
may obtain a modification of the judgment. See Greenlaw v.
United States, 554 U.S. 237 (2008). And none of the parties’
briefs discusses the significance of the pending state litigation, the fact that one branch of the City of South Bend is suing another, or the fact that before trial the individual parties’ suit had been settled and dismissed. After argument we
directed the parties to file briefs on these issues. We now
conclude that it is unnecessary to discuss the merits, for reasons that can be stated succinctly.
The initial problem, as we observed at the outset, is that
this suit began as a claim by the executive branch of a city’s
government against the legislative branch. Asked for precedent deeming such a suit justiciable, the parties knew of
none. We likewise could not find any. The suit is like one division of General Motors suing another. We held in Illinois v.
Chicago, 137 F.3d 474 (7th Cir. 1998), that a state cannot sue
one of its cities, because as far as the national government is
concerned a state and all of its creatures is a unit. That goes
for cities suing their states, too. See, e.g., Trenton v. New Jersey, 262 U.S. 182, 185–86 (1923); Williams v. Mayor & City
Council of Baltimore, 289 U.S. 36, 40 (1933).
Doubtless a state can divide powers into such rigidly
separated compartments that it is possible for one to sue another. See, e.g., Arizona State Legislature v. Arizona Independent
Redistricting Commission, 135 S. Ct. 2652 (2015). But a city’s
legislative and executive branches are not distinct juridical
entities; they are part of a single government. Sometimes individual members of the legislature are permitted to sue par-
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ticular executive officers, but they face formidable problems
of standing. See Raines v. Byrd, 521 U.S. 811 (1997). A suit by
one whole branch of the federal government against another
is not possible; a suit by the executive branch of a city versus
the legislative branch is equally improper. State courts may
have authority to resolve an intramural dispute, but otherwise it must be worked out the same way Congress and the
President resolve their differences: by politics.
But suppose this is wrong and that Arizona State Legislature becomes the norm rather than, as the Justices described
it, a special situation based on a state constitution’s provision allocating powers among state entities in a way that
was asserted to violate the federal Constitution. 135 S. Ct. at
2661–65. The fact remains that the City filed this suit in an
effort to achieve, through the Declaratory Judgment Act, the
removal of a single federal issue in a pending state case.
Potential state-court defendants can use the declaratoryjudgment process to curtail legal risk. The paradigm is the
person who contends that he fears being prosecuted under
state law for speech that is protected by the First Amendment and to avoid the risk of punishment will keep silent
unless a federal court declares the state law invalid. See, e.g.,
Steffel v. Thompson, 415 U.S. 452 (1974). But once a state prosecution begins, the state court is the right place for the federal defense. That’s the holding of Younger v. Harris, 401 U.S.
37 (1971), for criminal cases, and we know from Samuels v.
Mackell, 401 U.S. 66, 69–73 (1971), that Younger applies to declaratory judgments as well as to injunctions. Trainor v. Hernandez, 431 U.S. 434 (1977), adds that the same principle applies to civil litigation brought by a state to implement state
policy. See also Huffman v. Pursue, Ltd., 420 U.S. 592 (1975).
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The Common Council sued in state court to vindicate
what it depicts as a right to information needed for the exercise of its legislative powers. Whether or not that activates
the Younger principle, it certainly makes the issuance of a declaratory judgment imprudent. Wilton v. Seven Falls Co., 515
U.S. 277, 289–90 (1995), and Brillhart v. Excess Insurance Co.,
316 U.S. 491 (1942), conclude that a federal judge ordinarily
should decline to issue a declaratory judgment when the
same parties are litigating the same issues before a state
court, even when the state plaintiff is a private entity. When
the state plaintiff is a governmental body, putting Trainor
and Huffman together with Wilton and Brillhart leads straight
to the conclusion that it is an abuse of discretion to take a
federal defense out of a state judge’s hands by issuing a declaratory judgment. If any court is to resolve a dispute between the legislative and executive branches of a unit of
state or local government, a state court is the right forum.
The district judge did not suggest disagreement with these principles and instead invoked Captain Young’s (and the
other private litigants’) request for damages under 18 U.S.C.
§2520 as the basis of its authority. There are two problems.
First, what we have said already shows that the existence of
subject-matter jurisdiction is a necessary, but not a sufficient,
condition for issuing a declaratory judgment. Second, by the
time of trial there was no dispute about damages requiring
resolution. The request for damages had been settled and the
private suit dismissed. The parties to that suit executed a release in November 2013. The settlement includes a provision
that public release of the recordings will be governed by the
outcome of the state litigation. That left nothing more for the
federal judge to do.
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In papers filed after the oral argument, the parties
stressed that only the request for damages has been settled
and that the five individual litigants still want a declaratory
judgment that the City must not make the recordings public
or otherwise use them. But how does that justify a decision
by a federal court? Equitable relief—injunctions and declaratory judgments alike—depends on a conclusion that legal
relief such as damages is inadequate to protect injured parties. By settling their claims, the five individual litigants
have shown that financial relief is adequate. To seek a declaratory judgment is to request an advisory opinion on top
of the settlement.
We could imagine an argument that a further release or
use of the recordings, should the Common Council prevail
in the state case, would cause further injury to the five individual litigants and justify additional compensation. But the
settlement forecloses that possibility. It provides for payment of a flat sum, even as it contemplates the possibility
that the state court will permit dissemination of the recordings. The parties could have structured their settlement so
that additional disclosure leads to additional remuneration,
but they did not. The five individual litigants have given up
any entitlement to further compensation, perhaps receiving
a larger lump sum as a result. What’s more, if the state court
authorizes a further disclosure, this would reflect a decision
that federal law permits disclosure. That conclusion would
knock out any legal basis for additional compensation. In
sum, the settlement removes the private interests from the
case, leaving only the City’s effort to move a federal defense
from state to federal court.
Case: 15-3315
Document: 67
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Filed: 08/01/2017
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The judgment of the district court is vacated, and the
case is remanded with instructions to dismiss the complaint.
The state court now is free to resolve the underlying dispute
on its own, without regard to the vacated federal judgment.
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