Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca10-06-01065/USCOURTS-ca10-06-01065-0/pdf.json

Parties Involved:
Mark Evers
Appellant
Georgia Lesh-Laurie
Appellee
Regents of the University of Colorado
Appellee
James Shore
Appellee
W. James Smith
Appellee

Document Text:

FILED

United States Court of Appeals

Tenth Circuit

December 13, 2007

Elisabeth A. Shumaker

Clerk of Court

PUBLISH

UNITED STATES COURT OF APPEALS

TENTH CIRCUIT

MARK EVERS,

Plaintiff - Appellant,

v. No. 06-1065

THE REGENTS OF THE

UNIVERSITY OF COLORADO;

GEORGIA LESH-LAURIE, in her

individual and official capacities; W.

JAMES SMITH, in his individual and

official capacities; JAMES SHORE, in

his official capacity,

Defendants - Appellees.

APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLORADO

(D.C. NO. 04-cv-2028-PSF-PAC)

Nora Kelly, Denver, Colorado, for Plaintiff - Appellant.

Sonja McKenzie, Senter, Goldfarb & Rice, L.L.C., David Temple, Associate

University Counsel, University of Colorado, (Thomas S. Rice and Elliot J. Scott

of Senter, Goldfarb & Rice, L.L.C. and Patrick T. O’Rourke, Associate University

Counsel, University of Colorado, with them on the brief), Denver, Colorado, for

Defendants - Appellees.

Before MURPHY, HARTZ, and HOLMES, Circuit Judges.

HARTZ, Circuit Judge.

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Mark Evers was employed by the University of Colorado at Denver (UCD)

as the Managing Director for the Extended Studies Office (the ESO) of the

College of Liberal Arts and Sciences beginning in 1999. UCD is one of several

campuses of the University of Colorado (the University). See Colo. Rev. Stat.

§ 23-20-101(b). His supervisor was defendant W. James Smith, the Dean of the

College. The Chancellor of UCD was Georgia Lesh-Laurie. Mr. Evers was

terminated in 2002. At the time of the termination two newspapers publicized a

University report that accused him of financial irregularities.

Mr. Evers filed suit in the United States District Court for the District of

Colorado alleging various claims against the Regents of the University and

several employees in their official capacities (the University Defendants), and

against Smith and Lesh-Laurie in their individual capacities (the Individual

Defendants). The district court granted summary judgment in favor of all

defendants on all claims. On appeal Mr. Evers challenges only the district court’s

grant of summary judgment on his claim under 42 U.S.C. § 1983 that he was

denied his liberty interest under the Fourteenth Amendment’s Due Process Clause

by the defendants’ dissemination of the University report without providing him a

name-clearing hearing. We affirm the judgment in favor of the Individual

Defendants but reverse the judgment in favor of the University Defendants and

remand for further proceedings.

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The accusations against Mr. Evers arose out of three incidents. First, in

recognition of some of his employees’ extra efforts in 2001, Mr. Evers granted

them time off with pay without approval from Dean Smith. (We refer to this as

the administrative-leave incident.) Second, in December 2000 he granted one of

his employees paid time off from his regular duties to prepare for a foreign

teaching assignment. (We refer to this as the foreign-teaching incident.) Third,

in June 2001 he paid a different ESO employee for full-time work for a week after

she had begun employment elsewhere. (We refer to this as the termination-date

incident.)

In March 2002 the University’s Department of Internal Audit began an

investigation of possible fiscal misconduct in the ESO, preliminarily concluding

that there had been no fraud or fiscal misconduct. But before issuance of a final

report, one of the auditors was removed from the investigation because of an

alleged conflict of interest. New auditors completed the investigation and issued

a final report (the Audit Report) in August 2002. The Audit Report described the

allegations against Mr. Evers, made factual findings regarding both the

allegations and his asserted defenses, and drew conclusions regarding compliance

with University policies. The conclusions were adverse to Mr. Evers on all three

incidents. On the administrative-leave incident it said:

Making misrepresentations on three subordinates’ University

monthly Time and Leave Reports in order to conceal leave time taken

to which the subordinates were not entitled. 

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Subject did knowingly sign his approval on Time and Leave Reports

that falsely reported no leave time, when in fact both he and the

subordinates knew time off had been taken.

Aplt. App. Vol. 1 at 204. Similarly, on the foreign-teaching incident it

determined:

Making misrepresentations on one subordinate’s University

appointment documentation to allow the subordinate additional paid

time off to prepare for teaching two courses in a foreign country.

Evidence indicates Subject directed subordinates to submit

appointment documentation for the Dean’s approval that

misrepresented the actual agreement between the parties.

Id. And it concluded as follows regarding the termination-date incident:

Making misrepresentations on one subordinate’s University

Termination paperwork to allow for the subordinate to receive

continuing full-time compensation after commencing another

full-time position outside the University.

Subject knowingly approved a termination date that was seven paid

days beyond the actual date she began employment elsewhere. 

Evidence suggests that this was done to compensate her for the

remaining “administrative leave” agreed to, but not taken, prior to

her resignation, totaling 56 hours. We found no evidence to support

the number of hours she actually worked.

Id. The Audit Report’s overall conclusion was: “It is our judgment that

sufficient evidence exists to reasonably conclude fiscal misconduct has occurred,

warranting disciplinary action.” Id. at 205. The University’s Department of

Internal Audit website states that “Fiscal misconduct involves intentional acts or

failures to act in order to obtain unauthorized or unlawful gain. The primary

factor that distinguishes fiscal misconduct from error is the intent of the person

taking the underlying action.” Id. Vol. 2 at 247. 

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Mr. Evers denies that his actions constituted fiscal misconduct because he

did not intend to violate, and believed his actions were consistent with, both

University policy and applicable law. Regarding the administrative-leave

incident, he asserts that he believed that he had the authority to grant

administrative leave without his supervisor’s approval. Although he admits that

he signed time records for these employees that did not reflect the administrative

leave he had granted them, he denies that he made misrepresentations because the

forms required reporting only vacation time and sick leave. With respect to the

foreign-teaching incident he denies that he made any misrepresentation about his

agreed arrangement with the employee for the time off to prepare to teach. And

as to the termination-date incident he claims that the employee worked a full eight

hours for the ESO each day during her last week of employment. He disputes the

Audit Report’s finding that he misrepresented the employee’s termination date to

compensate her for promised administrative leave, and he claims that he gave the

auditors information to verify his position.

On August 12, 2002, Smith notified Mr. Evers that he would be assigned to

other duties for the next 30 days and then terminated. Smith admitted in his

deposition that one of his reasons for terminating Mr. Evers was the audit of the

ESO, and there is evidence that Smith had received a draft copy of the Audit

Report before notifying Mr. Evers of his termination. The final Audit Report was

issued on August 15, but Mr. Evers did not receive a copy of it until August 27. 

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He claims that he was not afforded an opportunity to contest the allegations in the

report, or to appeal its findings or conclusions, “to clear [his] name of the

allegations before the Report was released to the press.” Aplt. App. Vol. 2

at 256. On August 29 an article appeared in the University’s newspaper detailing

the charges in the Audit Report. The article repeated the allegations of

“falsification” and “misrepresentation,” as well as the report’s ultimate

conclusion that “fiscal misconduct” had occurred, warranting disciplinary action

against Mr. Evers. Aplt. App. Vol. 1 at 113. The next day a similar article

appeared in the Rocky Mountain News, headlined “CU-Denver official punished

over funds.” Id. at 115.

After Mr. Evers’s termination became effective on September 11, 2002, he

received a letter from Chancellor Lesh-Laurie indicating that the Board of

Regents had delegated her to respond to the Internal Audit investigation and

informing him of the decision to keep the Audit Report in his permanent file for

three years. The letter also stated, “After reviewing the facts presented in the

investigation, we believe that fiscal misconduct appears to have occurred. 

However, although we believe intent to deceive was shown, it is clear also that

you did not believe you were acting unlawfully in permitting the leaves that you

approved.” Id. Vol. 2 at 345. 

A year later Mr. Evers obtained a teaching position at the University of

Denver. The position’s responsibilities are significantly different from those he

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had at UCD and the pay is substantially less. He claims that publication of the

Audit Report has precluded him from applying for some jobs and that he has not

been interviewed or even contacted with respect to other positions for which he

has applied. He complains of the stigma on his reputation, which, he contends, is

critical to a position in higher education. He asserts that he has been deprived of

his ability to pursue the occupation of his choice: a position similar to the one he

held at UCD, preferably in Colorado. He continues to search for job openings of

this nature.

I. DISCUSSION

We review a district court’s grant of summary judgment de novo, applying

the legal standard under Fed. R. Civ. P. 56(c). See Renaud v. Wyo. Dep’t of

Family Servs., 203 F.3d 723, 726 (10th Cir. 2000). Rule 56(c) provides that

summary judgment should be granted only “if the pleadings, depositions, answers

to interrogatories, and admissions on file, together with the affidavits, if any,

show that there is no genuine issue as to any material fact and that the moving

party is entitled to a judgment as a matter of law.” We view the evidence in the

light most favorable to the party opposing summary judgment. See id. at 726.

Workman v. Jordan, 32 F.3d 475, 481 (10th Cir. 1994), sets forth a

four-part test that a plaintiff must satisfy for a liberty-interest claim:

First, to be actionable, the statements must impugn the good name,

reputation, honor, or integrity of the employee. Second, the

statements must be false. Third, the statements must occur in the

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course of terminating the employee or must foreclose other

employment opportunities. And fourth, the statements must be

published. These elements are not disjunctive, all must be satisfied

to demonstrate deprivation of the liberty interest.

(citations omitted). A person who establishes a liberty-interest deprivation is

entitled to a name-clearing hearing. See id. at 480. We first consider the

judgment in favor of the Individual Defendants and then turn to the University

Defendants.

A. INDIVIDUAL DEFENDANTS

Mr. Evers argues that summary judgment on his liberty-interest claim

should be reversed because the district court erred in concluding that he had

failed to come forward with evidence that the statements in the Audit Report were

false. Lack of evidence of falsity was the basis for the court’s grant of summary

judgment in favor of the University Defendants. But the summary judgment in

favor of the Individual Defendants relied on a different ground: that Mr. Evers

failed to establish that either Smith or Lesh-Laurie made or was otherwise

culpable for the statements at issue. Because Mr. Evers does not address, let

alone argue, this ground in his appeal briefs, we affirm the summary judgment in

favor of the Individual Defendants. See GFF Corp. v. Assoc. Wholesale Grocers,

Inc., 130 F.3d 1381, 1388 (10th Cir. 1997) (affirming summary judgment when

plaintiff failed on appeal to address alternative ground relied on by district court).

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B. UNIVERSITY DEFENDANTS

Stating that Mr. Evers had admitted the underlying actions described in the

Audit Report and disputed only the “conclusions drawn therefrom,” the district

court ruled that he had failed to come forward with enough evidence of the falsity

of statements in the Audit Report to warrant a trial against the University

Defendants on his liberty-interest claim. Aplt. App. Vol. 2 at 535. The court

rejected his contention that “because there is no indication of personal gain or of

the requisite intent to commit fraud, a material issue of fact exists regarding the

report’s falsity.” Id. It noted further that any intent to deceive is “questioned and

downplayed in the report itself,” which concludes that his actions were “‘either an

attempt to deceive, or exceptionally bad judgment.’” Id. at 536 (quoting Audit

Report) (emphasis added). The court concluded that “the report here simply

attempted to set forth the universe of plaintiff’s plausible motives in acting in a

manner deemed fiscal misconduct in violation of University policy. . . . While

neither conclusion is compl[i]mentary toward plaintiff, neither are these

alternatives both false.” Id. at 537–38.

Based on our de novo review of the record, we respectfully disagree. 

Mr. Evers came forward with evidence (largely his own sworn testimony)

sufficient to establish a triable fact issue regarding the falsity of statements in the

Audit Report. First, Mr. Evers expressly disputed the report’s assertions that he

made misrepresentations in the foreign-teaching and termination-date incidents. 

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The record reflects that, as described above, Mr. Evers’s version of these events

was materially different from the findings in the Audit Report. And with respect

to the administrative-leave incident, although Mr. Evers did not dispute the

substantial truth of the Audit Report’s description of his actions, he challenged

the nontrivial conclusions regarding his intent. The report charged him with

fiscal misconduct, which, according to the University’s own explanation of this

term, requires “intentional acts or failures to act in order to obtain unauthorized

or unlawful gain.” Id. at 247. According to the explanation, “The primary factor

that distinguishes fiscal misconduct from error is the intent of the person taking

the underlying action.” Id. Thus, key to the charge of fiscal misconduct was

Mr. Evers’s intent in taking the undisputed actions. But intent is the

“quintessential factual question.” United States v. Bohl, 25 F.3d 904, 909 (10th

Cir. 1994). Although the district court characterized the Audit Report as “simply

attempt[ing] to set forth the universe of plaintiff’s plausible motives in acting in a

manner deemed fiscal misconduct,” Aplt. App. Vol. 2 at 537, we read it as

asserting more. Indeed, if Mr. Evers only used bad judgment or, as he asserts,

made a good-faith attempt to follow applicable policy and law, then the charge of

fiscal misconduct was unfounded. Therefore, we hold that there were material

fact issues in dispute regarding the falsity of the charge of fiscal misconduct. 

Summary judgment on the falsity element of the claim cannot be sustained.

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II. ALTERNATIVE GROUNDS FOR AFFIRMANCE

The University Defendants urge us to affirm summary judgment on

Mr. Evers’s liberty-interest claim on several alternative grounds. First, they point

out that the district court noted that Mr. Evers had offered no evidence of the

University’s “vicarious liability” for the statements about him. Id. at 535. In our

view, however, it is unclear whether the district court relied on this ground in

granting summary judgment. More importantly, Mr. Evers is correct that the

University Defendants did not raise the issue in their summary-judgment motion,

so he had no opportunity to respond below. At oral argument before this court

the attorney for the University Defendants contended that Mr. Evers was on

notice that he needed to present evidence of the University’s vicarious liability

because the Individual Defendants’ motion for summary judgment asserted that

neither Smith nor Lesh-Laurie had disseminated the Audit Report to the press and

that placement of the report in his personnel file did not constitute publication. 

But even if the University Defendants can take advantage of a motion for

summary judgment that they did not join, the Individual Defendants’ motion

hardly placed Mr. Evers on notice that he needed to present his entire argument

and all his evidence regarding conduct by University personnel (including persons

other than Smith and Lesh-Laurie) upon which the University’s liability could be

based. It would be unfair to affirm a summary judgment against a plaintiff for

lack of evidence of an element of the cause of action unless the defendant has

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clearly challenged that lack of evidence in district court. We therefore decline to

affirm summary judgment on this ground. See Tavery v. United States, 32 F.3d

1423, 1427 n.5 (10th Cir. 1994).

The other two grounds for affirmance urged by the University Defendants

were raised in their summary-judgment motion but not resolved by the district

court. First, they argue that the allegedly harmful statements were not made in

the course of Mr. Evers’s termination because he was terminated before the

issuance of the Audit Report and for reasons other than the report, which, they

note, did not call for his termination. See Renaud, 203 F.3d at 727 (requiring that

statements occur in course of terminating employee). Second, they contend that

because Mr. Evers has presented no evidence that any prospective employer was

aware of the Audit Report or the newspaper articles, and in any event he has

obtained another job, he cannot establish that other employment opportunities

were foreclosed. Rather than examining and resolving the merits of these

contentions, however, we adopt the better practice of leaving the matter to the

district court in the first instance. See Pac. Frontier v. Pleasant Grove City, 414

F.3d 1221, 1238 (10th Cir. 2005) (“Where an issue has been raised, but not ruled

on, proper judicial administration generally favors remand for the district court to

examine the issue initially.”).

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III. CONCLUSION

The district court’s grant of summary judgment on Mr. Evers’s

liberty-interest claim against the Individual Defendants is AFFIRMED. The

district court’s grant of summary judgment on Mr. Evers’s liberty-interest claim

against the University Defendants is REVERSED and REMANDED.

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