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# E rsek v . T wp of S pr in g field

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. e du/thir dc ir c uit_1996/10UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

___________

NO. 95-1913

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ELLEN ERSEK, Appel lant

v.

TOWNSHIP OF SPRINGFIELD, DELAWARE COUNT Y; ANTHONY J. GROSSO; LEE J. JANICZEK; THOMAS V. MAHONEY; JOHN J. MCFADDEN; KITTY JURCIUKONIS; BERNARD E. STEIN; JAMES DEVENNEY, Individually and in their O fficial Capacities as Commissioners of the Townsh ip of Springfield; GEORGE A. PAGANO, Individually and in his Capacity as Former Commissioner of the T ownship of Springfield; JO ANN HUNN, Individually an d in her Capacity as Former Commissioner of the Town ship of Springfield; MICHAEL T. LEFEVRE, Individu ally and in his Capacity as Township Manager o f the Township of Springfield; JOSEPH STUMPF, Indi vidually and in his Capacity as Chief of Police of the Township of Springfield; JOHN W. RYAN, Individually an d in his Capacity as Police Detective of the Townsh ip of Springfield; JAMES F. DEVANEY, Individually and in his Capacity as Police Officer of the Township of Sprin gfield

Amended per Court's order of 11/27/96

.

_______________________________________ __

On Appeal From the United States District Court For the Eastern District of Pennsylvan ia
D.C. No. 92-cv-04673

_______________________________________ ___

Argued: June 3, 1996

Before: BECKER and MANSMANN, Circuit Judge s, and BROTMAN, District Judge.

(Filed December 9, 1996)

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HAROLD I. GOODMAN, ESQUIRE (ARGUED) Raynes, McCarty, Binder, Ross & Mundy
1845 Walnut Street
Suite 2000 Philadelphia, PA 19103Counsel for Appellant

DANIEL J. DIVIS, ESQUIRE (ARGUED) Dean F. Murtagh, Esquire German, Gallagher & Murtagh
200 South Broad Street

5th Floor Philadelphia, PA 19102

Counsel for Appellees

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OPINION OF THE COURT

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BECKER, Circuit Judge. William Ersek, a golf professional who suf fered employment reverses incident to adverse newspaper r eports about an investigation of his stewardship at a Township-o wned golf course, brought a federal civil rights action, 42 U .S.C. § 1983, against the Township and a number of its top offici als on account of false statements made by one of the officials ab out the matter. Ersek's appeal from the grant of summary j udgment in
favor of the defendants raises a number of interest ing questions under § 1983. However, his claim founders because there is
insufficient evidence to show that the false statem ents themselves caused him harm. Accordingly, we will a ffirm the grant of summary judgment for defendants.

I. From 1963 until the end of 1991, Ersek was employed as the golf professional at a municipally owned and op erated golf course, the Springfield Country Club, in Delaware C ounty, Pennsylvania. From 1963 until 1987, Springfield To wnship employed Ersek pursuant to successive one-year empl oyment contracts. In 1987, Ersek signed a four-year contr act. Ersek's duties as the Springfield golf pro were varied: he managed the pro shop and snack bar at the course, supervised th e other employees at the course, and collected the fees for playing the course and renting the golf carts. During the summer of 1989, a Township empl oyee, responding to complaints by Ersek that construction on the golf course had resulted in a lower volume of paying gol fers, counted the golfers on the course. The Township employee n oticed that the number of golfers actually on the course did no t correspond to the number of golfers Ersek reported to the Town ship. Michael Lefevre, the Township Manager and a defendant in th e case, noticed the same discrepancies. The matter was ref erred to the Township police. After some investigation in the f all of 1989, the police decided to conduct surveillance during t he spring and summer of 1990. The police inspection uncovered fu rtherdiscrepancies.

In August 1990, the police and Township em ployees notified the Township Board of Commissioners ("the Board"), a defendant in the case, of the results of their prob e. Until that time, no member of the Board knew of the investigat ion. Bernard Stein, the President of the Board and also a defend ant, informed the police that the Board would be willing to prose cute Ersek criminally if there were sufficient evidence to do so. After obtaining a search warrant, the police carried out a search of the pro shop and seized records stored therein. Er sek volunteered to the police that he kept additional r ecords at his home. The police obtained a second search warrant and then made a search of Ersek's home, seizing documents stored there as well. The Board discussed the Ersek case at a pu blic meeting six days after the police searches. Stein read a p ublic statement, earlier approved by the entire Board in executive session, concerning the case. Lefevre had also att ended the executive session. The statement falsely claimed t hat the Board had not only been aware of the investigation since its outset but also had directed the entire undertaking. The admi tted reason for the fabrication was to mislead the Township res idents into believing that the Board had been pro-active in ove rseeing the golf course. The statement did not, however, refer to Ersek nor contain other false claims. After the Township mee ting, local newspapers, and also The Philadelphia Inquirer, rep orted on the investigations and ran stories referring to Ersek b y name. Ersek had been suffering from health probl ems and, in the wake of the searches, did not return to work fo r several months. Although the Township continued to pay him for the time he spent away from the course, it moved to restruct ure the management of the course. For instance, the Townsh ip took control of the pro shop and responsibility for cour se employees. Nearing the contract's expiration in 1991, the Township offered to renew Ersek's contract, but under substa ntially altered terms. The salary under the proposed contr act would have been significantly less than that of the existing c ontract. Ersek refused to accept the terms of the proposed c ontract, and the Township hired a different golf professional. Ersek then sought job interviews with other country clubs in t he area, but to no avail. Ersek claims that the cloud placed ov er his head by the publicized investigation made securing employme nt at another golf course impossible. Ersek brought suit against the Township an d against a number of Township officials alleging a variety of federal civil rights and pendent state law claims. In an initial order, the district court granted the defendants' motion to di smiss Ersek's substantive due process claims, and ordered Ersek t o file an amended complaint to address deficiencies with resp ect to some of the other claims. See Ersek v. Township of Springf ield, Delaware County, 822 F. Supp. 218 (E.D. Pa. 1993). In so do ing, the court held that the Township did not act arbitrarily or c apriciously in offering Ersek a renewed contract under markedly di fferent terms; considering Ersek's ill health and age (Ersek was 5 9 years old at the time), the court found it not unreasonable for the Townshipto act as it did. Ersek subsequently dismissed a n umber of

defendants and abandoned a number of claims volunta rily. In a later order, the district court grant ed the remaining defendants' motion for summary judgment a s to all existing federal law claims. Relying primarily on Paul v. Davis, 424 U.S. 693 (1976) and Clark v. Township of Falls, 890 F.2d 611 (3d Cir. 1989), the court held that Ersek could not make out a claim for a violation of procedural due process bec ause he could not show that the Township's actions infringed on a constitutionally protected interest. Specifically, the district
court held that the fabrications contained in the T ownship's public statement did not harm Ersek to the extent t hat they violated a liberty interest in his reputation. And , even if those fabrications had harmed him, the court contin ued, Ersek
failed to adduce evidence that he suffered more tha n mere financial harm so as to rise to liberty interest. The district court also dismissed the pendent state law claims w ith leave to
file them in state court. Ersek appeals from the district court's fi nal order granting summary judgment, and includes in his appe al the court's order dismissing his substantive due process claims . The case raises both federal questions and pendent state law claims, and the district court properly exercised its jurisdict ion pursuant to 28 U.S.C. §§ 1331 and 1367; we exercise appellat e jurisdiction over this appeal of a final district court order pu rsuant to 28 U.S.C. § 1291. Our review is plenary as to the app eal both from the order granting summary judgment and that granti ng the motion
to dismiss.

II. We must perforce begin by considering whet her Ersek had a protectible liberty interest sufficient to trigge r due process protections. The Supreme Court, in the seminal cas e of Wisconsin v. Constantineau, 400 U.S. 433 (1971), re cognized that an individual has a protectible interest in reputat ion. It stated that "[w]here a person's good name, reputati on, honor, or integrity is at stake because of what the governmen t is doing to him, notice and an opportunity to be heard are esse ntial." Id.at 437.
The Court then went on to strike down a state statu te that failed to provide an individual with the oppor tunity to challenge a government official's posting notice th at no one may provide alcoholic beverages to that individual beca use of his problems with alcohol. Id. at 439. The inquiry is , however, more complicated today in light of intervening case law. For government action to infringe the "rep utation, honor, or integrity" of an individual, that governm ent action first must involve a publication that is substantia lly and materially false. See Codd v. Velger, 429 U.S. 624 , 627 - 29 (1977); Fraternal Order of Police Lodge No. 5 v. Tu cker, 868 F.2d 74, 82 (3d Cir. 1989). The principal relief to whi ch an individual is entitled should the government's stig matizing comments rise to the level of a due process violati on is a hearing to clear his name. See Codd, 429 U.S. at 6 27; Board of Regents of State Colleges v. Roth, 408 U.S. 564, 57 3 & n.12 (1972). If there is no factual dispute that "has s omesignificant bearing on the employee's reputation," then a nameclearing hearing would serve no useful purpose. Se e Codd, 429 U.S. at 627. In other words, the disputed or false statements must harm the plaintiff. In this case, Ersek claimed that false sta tements impaired his opportunities for future employment as a golf pro. Ersek has adduced ample evidence to create a genuin e issue of material fact as to whether the publicity about the fact of an investigation did such harm. See McKnight v. South eastern Pennsylvania Trans. Auth., 583 F.2d 1229, 1236 (3d Cir. 1978) (holding that harm to future employment possibiliti es may show sufficient stigma to allow a claim for a violation of a liberty interest). That the publicity may have harmed Erse k is not, however, the end of this inquiry, because the harm must be caused by the falsity of the statements and the fact of th e investigation is true. Thus, we must now determine whether the false statements made by the Township affected Erse k's reputation. It is undisputed that the public statement announcing the investigation at the Township golf course conta ined the false
statement that the Board had known about and direct ed the investigation from its outset. Ersek contends that a public statement including such a fabricated claim could g ive rise to the false impression that the probe was a serious, non-routine matter. It is not usual for a legislative body to be engaged in the investigation of possible criminal activities. In Ersek's submission, anyone learning of the Board's (false) involvement could conclude that Ersek's alleged misdeeds were o f an unusual nature calling for extraordinary measures, and such a conclusion would have a significant bearing on Ersek's reputat ion because more serious allegations would likely engender more serious harm to an individual's reputation. Had the statement o nly mentioned the police involvement and omitted the Board's puta tive activity, the argument continues, there would be no cause to overstate the seriousness of the allegations. We are unconvinced. As we have stated, Er sek must show that the false comments made by the Township caused him some harm. The problem with Ersek's argument is that th e only false statements were that the Board had been heavily inv olved in the investigation at the golf course. Notwithstanding Ersek's protestations, we cannot imagine that such fabricat ions caused more harm than would a statement that truthfully sa id that only the police and a few Township officials were invest igating him. Should Ersek receive the hearing to which he claims he is entitled, the most for which he can seemingly ask i n the hearing is the opportunity to show that the investigation w as not conducted by the Board and that any inference that the investigation was unusual is incorrect. That heari ng could not be used to prove Ersek's innocence. He would still have hanging over his head the cloud of a police investigation. It seems fanciful that any golf course that refused to hire Ersek because of the statement actually given would now consider hiring him because only the police (and not the Board) were in vestigating
him.In sum, the false statements in this case simply have

not caused Ersek harm that a name-clearing hearing could correct. It was the fact of the investigation, not who condu cted the investigation, that might have injured Ersek's repu tation. Because Ersek cannot dispute the fact of the invest igation, a name-clearing hearing would be of no consequence to him. AccordHomar v. Gilbert, 89 F.3d 1009, 1021 - 22 (3d Cir. 1996) (de nying a procedural due process claim, in part based on th e reasoning that the truthful disclosure of a pending investiga tion did not stigmatize the plaintiff); S & D Maintenance Co. v. Goldin, 844 F.2d 962, 970 - 71 (2d Cir. 1988) (same).

III. Because we conclude that no genuine issue of material
fact exists as to Ersek's claim that the false stat ements made by the Township stigmatized him, the order of the dist rict court granting the defendants' motion for summary judgmen t will be
affirmed.