Cage v. Harper

PATRICK CAGE, Plaintiff, v. TIFFANY HARPER, et al., Defendants.

No. 17-cv-07621

UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF ILLINOIS EASTERN DIVISION

August 30, 2018

Judge Andrea R. Wood

MEMORANDUM OPINION AND ORDER

Plaintiff Patrick Cage worked at Chicago State University ("CSU" or the "University") as General Counsel from November 2009 until his termination in May 2017. Following his termination, Cage filed suit under 42 U.S.C. § 1983, alleging that Defendants Tiffany Harper, Nicholas Gowen, Kambium Buckner, Marshall Hatch, Sr., Horace Smith, (together, "Individual Board Defendants"), Rachel Lindsey, and the CSU Board of Trustees ("Board") violated his rights under the Due Process Clause of the United States Constitution by failing to provide him twelve months of continued employment after notice of his termination. Cage further alleges that Defendants violated the Illinois State Officials and Employees Ethics Act ("Ethics Act"), 5 ILCS 430/15-10, when he was terminated in retaliation for engaging in protected whistleblowing activity. Defendants now move to dismiss all claims pursuant to Federal Rule of Civil Procedure 12(b)(6). (Dkt. No. 22). For the foregoing reasons, the motion is granted in part and denied in part.

BACKGROUND¹

Cage served as General Counsel at CSU from November 2009 until May 2017. (Am. Compl. ¶¶ 21-22, 71, Dkt. No. 17.) In February and April 2017, Cage voiced concerns that then-Board member Paul Vallas was engaging in conduct that violated the University's Bylaws. (Id. ¶ 40.) Cage first discussed his concerns over lunch with Defendant Hatch. (Id.) Then, through private counsel, Cage sent a letter to the Board reiterating his concerns. (Id.) Subsequently, Defendants Harper and Gowen approached then-interim University President Cecil Lucy and asked whether he would be willing to terminate Cage if he was retained as President of the University. (Id. ¶ 50.) Lucy answered that he would not terminate Cage, and shortly thereafter he was replaced by Defendant Lindsey. (Id.)

After Lindsey was appointed as the University's President, Cage contacted her and inquired about rumors that she planned to terminate his employment. (Id. ¶ 52.) Lindsey assured Cage that she was not planning to terminate him. (Id.) Approximately one week later, on May 15, 2017, Lindsey invited Cage to her office for a meeting. (Id. ¶ 53.) During the meeting, Lindsey notified Cage that she had decided he was not the right fit for his position and that the University was terminating his employment, effective immediately. (Id. ¶ 53, 70-71.)

According to the Board's Rules and Regulations ("Regulations"), Section II, Subsection B.4, paragraph (b)(2)(c),² University employees who, like Cage, are beyond their sixth year ofemployment, are entitled to receive notice of their termination at least twelve months prior to the termination date, if the termination is without cause. (Id. ¶ 61.) The Regulations provide other procedures that the University must follow when terminating an employee for cause. (Id. ¶ 64.) The for-cause termination procedures were not followed in the present case, thus Cage was terminated without cause. (Id. ¶ 8.) Cage's last day of work at CSU was May 15, 2017, and a University security officer escorted him off University property. (Id. ¶¶ 70-71.)

DISCUSSION

To survive a Rule 12(b)(6) motion, "a complaint must contain sufficient factual allegations, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Pleading facts "merely consistent with" a defendant's liability and pleading legal conclusions disguised as factual allegations are, by themselves, insufficient. Id. (citing Twombly, 550 U.S. at 556). This standard does not necessarily require a complaint to contain "detailed factual allegations." Twombly, 550 U.S. at 555. Rather, "[a] claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 556 U.S. at 678.

In the present case, Cage claims that Defendants violated his constitutional right to procedural due process by depriving him of his property interest in twelve months of continued employment after notice of his termination. Cage further claims that Defendants violated the Ethics Act when it terminated him for his concerns regarding potential violations of University Bylaws. Defendants seek to dismiss all claims.

I. Cage's § 1983 Claims

A. The Board as a "Person" for Purposes of § 1983

Defendants argue that Cage cannot bring a § 1983 claim against the Board because, as an arm of the state, the Board is not considered a "person" for purposes of the statute. Cage, however, contends that his claim should be permitted because the Board waived its sovereign immunity by removing this case to federal court.

Section 1983 provides that "[e]very person" who under the color of state law deprives another of "any rights, privileges, or immunities secured by the Constitution and laws" is liable to the injured party. 42 U.S.C. § 1983. In Will v. Michigan Department of State Police, 491 U.S. 58 (1988), the Supreme Court held "that a State is not a person within the meaning of § 1983." Id. at 64. The Supreme Court considered multiple factors in reaching that conclusion, one of which was the states' sovereign immunity. Id. at 64-70. However, the common usage and meaning of the term "person," the legislative history, and congressional intent regarding § 1983 were also factors in the conclusion. Id.

As an "alter ego of the state," a state university, including its board of trustees, is "not subject to suits brought under § 1983." Kaimowitz v. Bd. of Trs. of Univ. of Ill, 951 F.2d 765, 767 (7th Cir. 1991). Nonetheless, Cage claims that because Defendants removed this case from state court (where it was originally filed) to federal court, the Board has waived its sovereign immunity. But the Board does not claim that it is entitled to sovereign immunity with respect to Cage's § 1983 claim. Instead, it argues that the Board is not subject to suit under the terms of the statute.

Generally, if a state defendant removes a claim to federal court, it has waived its right to assert a sovereign-immunity defense. Lapides v. Bd. of Regents, 535 U.S. 613 (2002) (findingthat a state waived its right to assert sovereign immunity with respect to a state law claim when it removed the case to federal court); Bd. of Regents of the Univ. of Wis. Sys. v. Phoenix Int'l Software, Inc., 653 F.3d 448, 460-61 (7th Cir. 2011) (recognizing that a state waives its ability to assert a sovereign immunity defense in response to a federal claim when it removes the case to federal court). Yet a state's waiver of sovereign immunity still does not subject that state to suit under § 1983 because, immune or not, "a state is not a 'person' against whom a § 1983 claim . . . might be asserted." Lapides, 535 U.S. at 617-18 (quoting Will, 491 U.S. at 66); see also Phoenix, 653 F.3d 448, 460-61 (specifying that a state's waiver of sovereign immunity does not allow a § 1983 claim to go forward because the state is not a person under that statute). The law is clear that a waiver of sovereign immunity cannot overcome the fact that a state is not a suable "person" for purposes of § 1983. Consequently, Cage's § 1983 claim against the Board must be dismissed.

B. Property Interest in Twelve-Month Term of Continued Employment

Defendants next challenge whether Cage had a protected property interest in continued employment at the University.

Defendants emphasize that the Regulations state that employees "serve at the pleasure of the President," (Bd. Reg. § II(B)(4)(b)(2)), and thus they assert that Cage should be considered an employee-at-will who does not have a constitutionally protected property interest in continued employment at the University. Cage, on the other hand, argues that while he could have been terminated for any reason, he could not be terminated at any time—the Regulations provide that employees "in the sixth or subsequent year of employment" who are terminated without cause shall receive notice of termination "not later than twelve months prior to the termination date specified in the notice." (Bd. Reg. § II(B)(4)(b)(2)(c).) Cage contends that this provision createsa protected property interest in twelve months of continued employment after notice of termination.

A property interest protected by the due process clause of the Fourteenth Amendment "may take many forms." Bd. of Regents of State Colls. v. Roth, 408 U.S. 564, 576 (1972). To obtain a protected property interest, a person must have "more than an abstract need or desire for [that interest and] more than a unilateral expectation of it . . . . He must, instead, have a legitimate claim of entitlement to it." Id. at 577. Further, property interests are not created by the Constitution but by "existing rules or understandings that stem from an independent source such as state law." Id. at 577-78.

In Illinois, employees are presumed to be at-will. Border v. City of Crystal Lake, 75 F.3d 270, 274 (7th Cir. 1996) (citing Duldulao v. St. Mary of Nazareth Hosp. Ctr., 505 N.E.2d 314, 317-18 (Ill. 1987)). However, at-will employment relationships can be otherwise modified or "overcome by demonstrating that the parties contracted otherwise." Duldulao, 505 N.E.2d at 318. In Duldulao, the Illinois Supreme Court held that "an employee handbook or other policy statement creates enforceable contractual rights if the traditional requirements for contract formation are present" Id. The Seventh Circuit has applied the Duldulao analysis when considering whether employee handbooks and other policy statements create a protected property interest in employment. See Cromwell v. City of Momence, 713 F.3d 361, 364-66 (7th Cir. 2013); Border, 75 F.3d at...