(CN) – A jury will determine whether the U.S. Postal Service induced prosecutors to file criminal charges against the CEO of a big contractor in retaliation for his public criticism, the D.C. Circuit ruled.
The service argued that its postal inspectors had qualified immunity as government officials against charges of malicious prosecution and of retaliatory inducement to prosecution. It said a reasonable official could have believed there was probable cause to prosecute William Moore for conspiring to bribe an official of the agency’s Board of Governors about 30 years ago.
Moore was the chief executive of Recognition Equipment Inc. (REI) in the early 1980s as it pursed a contract to sell multiple-line optical character readers to the Postal Service to read addresses. The service was leaning toward a rival technology using a single-line scanner to read the newly introducing “zip+4” nine-digit zip codes.
Moore aggressively lobbied individual members of Congress and testified before congressional committees in opposition to the zip+4 codes before the then Postmaster General personally admonished him “to be quiet” on the issue.
REI then hired public relations firm Gnau and Associates to take over lobbying efforts, which were successful in shifting the Postal Service to multiple-line scanners.
But the service still awarded the scanner contract to an REI competitor, leading Moore to denounce the decision as retribution for his public criticism of the “zip+4” codes.
Postal inspectors discovered that Peter Voss, a member of its board of governors, had recommended Gnau and Associates to REI in exchange for a kickback.
Voss and top executives at Gnau pleaded guilty to bribery charges while Moore and the vice president of REI were indicted on seven counts of fraud and theft.
Six weeks after Moore’s bench trial began, before he mounted a defense, the court granted his motion for acquittal concluding that the government had failed to establish a prima facie case.
In 1991 Moore filed suit against the assistant U.S. attorney who prosecuted him and six postal inspectors alleging that they had violated his Fist, Fourth and Fifth Amendments rights, and had committed defamation, invasion of privacy, false arrest, abuse of process and malicious prosecution.
As Moore’s case bounced between the various federal court channels, it set U.S. Supreme Court precedent for proving retaliatory inducement to prosecution. Moore had to show that the retaliatory intentions of a government agency – the Postal Service in this case – was the sole probable cause to bring the case.
Using this guideline, the District Court agreed with the Postal Service that Moore could not prove this since he had not raised any probable-cause objections when the grand jury indicted him. The indictment itself proved that the government had probable cause to bring the charges against him, according to the court, which dismissed Moore’s remaining two claims against the service.
Moore appealed to the D.C. circuit arguing that he had in fact argued that there was no probable cause to prosecute him. He also included evidence that the prosecutor had told grand jury witnesses to withhold parts of their testimony and that two Postal Inspection Service documents specifically refer to Moore’s lobbying as a rationale for prosecution.
The appellate panel said the District Court should “take into account the rebuttable presumption in favor of probable cause, but should also consider whether [Moore] has offered enough evidence to create a genuine issue of material fact as to the legitimacy, veracity and sufficiency of the evidence presented to the grand jury.”
On remand the postal inspectors claimed Moore had not overcome the probable-cause presumption and that, even if he had, they were entitled to qualified immunity because a reasonable official could have believed there was probable cause.
The District Court disagreed, finding that Moore had presented enough evidence, without presenting his entire case, to suggest that a jury could conclude that that “the government procured the plaintiff’s indictment through wrongful conduct undertaken in bad faith and that the government lacked probable cause to prosecute the plaintiff.” As such, there was “a genuine issue of material fact as to whether the government lacked probable cause to prosecute Moore.”
The postal inspectors appealed that denial, but the D.C. Circuit said summary-judgment orders denying qualified immunity are not appealable where the District Court has found an issue of material fact regarding the conduct of the official claiming immunity.
The three-judge panel also agreed that the postal inspectors were not immune because a reasonable official could conclude that probable cause did exist for filing charges.
“In sum, the absence of probable cause is not an element of the free speech right allegedly violated in a First Amendment retaliatory inducement to prosecution case and for this reason its presence vel non [or not] has no bearing on whether a defendant has violated a ‘clearly established … constitutional right of which a reasonable person would have known,” Judge Karen Henderson wrote for the court, adding emphasis to the quotation from Harlow v. Jordan and her own point.
By defending the reasonableness of probable cause, the postal inspectors had tried to evade a jury question, according to the 21-page decision. The District Court had already said the jury must decide whether the U.S. attorney relied on probable cause to prosecute Moore or the postal inspectors’ retaliatory impulse.
“At bottom, the postal inspectors’ arguable probable cause argument is nothing more than an attempt to end-run the jurisdictional limitation on interlocutory review,” Henderson wrote. “They seek to frame as a qualified immunity defense what is in fact a challenge to the district court’s determination that a disputed issue of fact exists on the issue of causation, to be determined by the existence vel non of probable cause.”
The panel remanded the case to the District Court for trial on the merits.
In a separate concurring opinion, Henderson expressed frustration with the government’s repeated efforts to block Moore’s day in court:
“I write separately to express dismay over the herculean effort the plaintiff has had to expend simply to get his day in court. It has taken twenty-five years, a criminal trial, eleven appellate judges as well as all participating members of the United States Supreme Court – not one of whom has rejected his claim as a matter of law – to get to the point that a jury will finally hear and decide if government officials engaged in pay-back because the plaintiff sought to do business with the government. To say that this has not been the government’s finest hour is a colossal, and lamentable, understatement.”