Schlier v. Rice

630 F.Supp.2d 458

Jimmy A. SCHLIER, Wreckers Int'l, Inc. d/b/a Schlier's Towing & Service Center, Plaintiffs, v. John G. RICE, et al., Defendants.

Civil Action No. 3:04-CV-1863.

United States District Court, M.D. Pennsylvania.

October 9, 2007.

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Cletus P. Lyman, Michael Steven Fettner, Michael T. Sweeney, Lyman & Ash, Philadelphia, PA, for Plaintiffs.

R. H. Hawn, Jr., Pennsylvania State Police, Office of Chief Counsel, Harrisburg, PA, Sean A. Kirkpatrick, Sarah C. Yerger, Office of Attorney General of the Commonwealth of PA, Linda Cadden Barrett, Office of General Counsel, Harrisburg, PA, for Defendants.

MEMORANDUM

A. RICHARD CAPUTO, District Judge.

Presently before the Court are two motions for summary judgment. Plaintiffs Jimmy Schlier and Wreckers International, Inc., move for partial summary judgment on liability against Defendants Major John G. Rice and Col. Jeffrey B. Miller, in both their individual and official capacities, for violation of Plaintiffs' First Amendment rights. (Pls.' Mot. for Partial Summ. J., Doc. 89.) Defendants John G. Rice, et al., move for summary judgment on all claims. (Defs.' Mot. for Summ. J., Doc. 96.) Because questions of material fact exist regarding the liability of Defendants Rice and Miller for First Amendment retaliation, Plaintiffs' motion for partial summary judgment will be denied. Because no claims have been made against Defendant Sharp, she will be dismissed from this action. Because questions of material fact exist regarding whether Defendants Rice, Miller, and Dougalas retaliated against Plaintiffs for exercise of their First Amendment rights; the evidence in the record, even resolving all disputed facts in favor of Plaintiffs, is not sufficient to make out a claim of First Amendment retaliation against Defendants McGuire, Transue and Robb; Plaintiffs have not adduced sufficient evidence to show that they had a property interest protected by the Fourteenth Amendment; and the evidence in the record, viewed in the light most favorable to Plaintiffs, shows a violation of Plaintiffs' clearly established rights by Defendants Rice, Miller, and Dougalas, Defendants' motion for summary judgment will be granted in part and denied in part.

BACKGROUND

I. Factual Background

The following facts are undisputed. Plaintiff Jimmy A. Schlier is the owner and president of Plaintiff Wreckers International Inc., d/b/a Schlier's Towing & Service Center ("Schlier's Towing"). (Decl. of Jimmy A. Schlier, Doc. 91 ¶ 1.) Schlier's business began performing towing services for the Pennsylvania State Police (PSP) in 1976 or 1977, and until September 2002, Plaintiffs were on the State Police's approved towing referral lists, whereby they regularly received requests from motorists and police to tow vehicles that were broken down, involved in accidents, or impounded for criminal investigations; Plaintiffs also regularly performed towing and repair services on police vehicles. (Pls.' Statement of Undisputed Material Facts, Doc. 90 ¶¶ 2, 5, 13 [hereinafter Pls.' Statement]; Defs.' Counterstatement of Undisputed Material Facts, Doc. 107 ¶¶ 2, 5, 13 [hereinafter Defs.' Counterstatement].)

Defendants are Colonel Jeffrey Miller, Commissioner of the PSP; Major John Rice, Commander of Area V and, in 2002, before his promotion from captain, the commanding officer of Troop N, which includes five (5) stations; Lieutenant David Dougalas, the station commander of the Swiftwater barracks of Troop N; Daniel McGuire, assistant counsel at the State Police Office of Chief Counsel (OCC) beginning April 8, 2002¹; Lieutenant Colonel Cynthia Transue, Commander of Area V in 2002; Joe Robb, Director of the Bureau of Vehicle Management in the Department of General Services (DGS) in 2002; and Josie Sharp, current Director of Vehicle Management in the DGS. (Pls.' Statement ¶¶ 8-10; Defs.' Counterstatement ¶¶ 8-10; Pls.' Second Am. & Supplemental Compl., Doc. 67, ¶¶ 6, 11; Defs.' Answer to Second Am. & Supplemental Compl., Doc. 103 ¶¶ 6, 11; Dep. of Daniel McGuire, Doc. 122-7, at 15: 2-10, 143: 3-8.)

In February 2001, the PSP adopted Field Regulation 6-2, which regulated the provision of emergency towing services. It provided troop commanders with authority to suspend towing operators from the referral lists for a number of reasons, including failure to maintain the regulation's standards; commission of an act involving dishonesty or corruption when it affects the health, welfare, or safety of others; overcharging for services, to be determined in conjunction with the fee schedule the operator submitted its application; or repeated conduct that tends to demean the public image of the Police. (Defs.' Statement of Undisputed Material Facts, Doc. 122 ¶¶ 3-4 [hereinafter Defs.' Statement]; Pls.' Counterstatement of Facts, Doc. 137 ¶¶ 3-4 [hereinafter Pls.' Counterstatement].)

In late 2001 or early 2002, disputes developed between Plaintiff Schlier and the PSP about billing. (See Pls.' Statement ¶ 15; Defs.' Counterstatement ¶ 15.) In January 2002, Mr. Schlier had a series of conversations with Representative Kelly Lewis, discussing trouble he was having getting paid for towing operations. (Dep. of Jimmy Schlier, Oct. 19, 2005, Doc. 140-6, at 61-64.) In response to a price that the Police thought exorbitant and a complaint filed against Schlier's Towing by another company, which led to an investigation into possible deceptive practices by Schlier's Towing, the PSP decided to no longer use Schiler's services exclusively but to seek out the best price each time towing services were needed. (See Defs.' Statement ¶¶ 12-18; Pls.' Counterstatement ¶¶ 12-18.) Mr. Schlier called then-Captain Rice to express concern that his services were no longer being used, and Rice informed him of the decision; at this point, Schlier complained of unpaid bills and Rice told Schlier to forward any such bills to Rice for his evaluation. (Defs.' Statement ¶¶ 18-19; Pls.' Counterstatement ¶¶ 18-19.) Schlier then sent more than sixty (60) bills totaling thirty-three thousand, three hundred twenty-five dollars and seventy-five cents ($33,325.75). (Pls.' Statement ¶ 17; Defs.' Counterstatement ¶ 15.)

On April 27, 2002, Plaintiff Schlier sent a formal complaint to the Director of the Division of Internal Affairs, which investigates reports of misconduct, alleging that the Swiftwater barracks had failed to pay bills and had improperly directed towing business to another towing operator owned by a convicted felon. (Pls.' Statement ¶¶ 18-21; Defs.' Counterstatement ¶¶ 18-21.) This complaint was forwarded to Rice by May 22, 2002. (Pls.' Statement ¶ 23; Defs.' Counterstatement ¶ 23.) Rice later asked his personnel to survey Plaintiffs' rates, and after a survey, Lieutenant Dougalas reported to Rice that Plaintiffs' rates were two (2) to four (4) times higher than competitors'. (Defs.' Statement ¶¶ 25-27; Pls.' Counterstatement ¶¶ 25-27.) Although this much is undisputed, Plaintiffs dispute Dougalas' conclusion itself and even dispute that Dougalas believed it. (Pls.' Counterstatement ¶ 26.)

On August 27, 2002, Rice informed Plaintiff that his company would be removed from all Troop N referral lists effective September 6, 2002. Rice informed Plaintiff that his decision was based on four factors: (1) Schlier's Towing failed to meet the requirement of charging reasonable and customary fees; (2) the company demeaned the image of the State Police by falsely communicating to another business that it had a contract with the Police and that the Police approved of its billing practices; (3) a complaint filed by that other company against Schlier's Towing resulted in a criminal investigation into deceptive or fraudulent business practices; and (4) Schliers's Towing submitted invoices to the Police totaling thirty-three thousand, three hundred twenty-five dollars and seventy-five cents ($33,325.75) but the State Police do not act as guarantor of the expenses that motorists may owe to emergency towing operators and the Police will not assume responsibility for the expenses. Finally, Rice informed Plaintiff that he could apply for reinstatement after six (6) months, contingent upon taking "appropriate remedial action so that [your business] will not conflict with the standards required by the Pennsylvania State Police." (Pls.' Statement ¶¶ 24-25; Defs.' Counterstatement ¶¶ 24-25.) The criminal investigation of Schlier's Towing ended September 26, 2002, after the district attorney declined prosecution. (Pls.' Statement ¶ 53; Defs.' Counterstatement ¶ 53.)

On November 15, 2002, Schlier's Towing filed an action with the Pennsylvania Board of Claims against the PSP to recover the charges it claimed it was owed, and the Board of Claims entered an opinion sustaining Plaintiffs' claim as stating a cause of action for breach of an implied-in-fact contract or an implied-in-law contract. (Pls.' Statement ¶¶ 54-55; Defs.' Counterstatement ¶¶ 54-55.) In March 2003, Plaintiffs unsuccessfully applied for reinstatement to the Police referral lists. (Pls.' Statement ¶¶ 57-60, 62-64; Defs.' Counterstatement ¶¶ 57-60, 62-64.)

In March 2006, Plaintiffs, through counsel, sent a letter to Colonel Miller complaining that the PSP had removed them from the referral lists in retaliation for exercise of their First Amendment rights to petition the government for redress of grievances, namely, for submitting the invoices. Plaintiffs argued in the letter that the reasons Rice gave for the suspension were pretextual. (Pls.' Statement ¶ 67; Defs.' Counterstatement ¶ 67.) An assistant counsel with the State Police then wrote to Plaintiffs' counsel that his letter was best directed not to Miller but to the Office of Attorney General, which represented the Defendants, as that he would forward it there. (Pls.' Statement ¶ 68; Defs.' Counterstatement ¶ 68.)

In August of 2006, after Plaintiffs moved for a preliminary injunction ordering...