Opinion ID: 201338
Heading Depth: 2
Heading Rank: 2

Heading: The Gibson exception

Text: 24 Esso asserts that even if Younger would otherwise mandate abstention, the EQB's extreme bias makes federal intervention appropriate in this case under an exception carved out in Gibson v. Berryhill, 411 U.S. 564, 93 S.Ct. 1689, 36 L.Ed.2d 488 (1973).
25 In Gibson, the Alabama Optometric Association (Association), whose membership was limited to independent practitioners, filed unprofessional conduct charges against licensed optometrists who worked for a corporation rather than as independent practitioners. 411 U.S. at 567-68, 93 S.Ct. 1689. The charges were filed with the Alabama Board of Optometry (Board), the statutory body with authority for licensing the practice of optometry. Only members of the Association could be members of the Board. The plaintiffs sought federal injunctive relief from the Board proceedings on due process grounds, arguing that the Board was impermissibly biased because its members stood to gain financially from delicensing the employed optometrists, with whom they were in competition. Id. at 570, 579, 93 S.Ct. 1689. 26 The Supreme Court found that these circumstances warranted federal intervention. It noted that Younger abstention naturally presupposes the opportunity to raise and have timely decided by a competent state tribunal the federal issues involved. Id. at 577, 93 S.Ct. 1689. On the facts presented, the Court concluded, the predicate for [abstention] was lacking, for ... the State Board of Optometry was incompetent by reason of bias to adjudicate the issues pending before it. Id. Specifically, those with substantial pecuniary interest in legal proceedings should not adjudicate these disputes. Id. at 578, 93 S.Ct. 1689. We recently interpreted this exception as holding that there is some reason for interim federal court intervention where core constitutional values are threatened during an ongoing state proceeding and there is a showing of irreparable harm that is both great and immediate. Maymo-Melendez, 364 F.3d at 37 (internal quotation marks omitted). 27 Esso's claim implicates the concerns raised in Gibson. 6 As in Gibson, the adjudicative body stands to benefit financially from the proceeding because any fine imposed will flow directly to the EQB's budget. Although members of the EQB Governing Board may not stand to gain personally in the same way that members of the Alabama Board of Optometry did, a pecuniary interest need not be personal to compromise an adjudicator's neutrality. See United Church of the Med. Ctr. v. Med. Ctr. Comm'n, 689 F.2d 693, 699 (7th Cir.1982) ([T]he Commission has a pecuniary interest in the outcome of the reverter proceedings, because ... in the event of a subsequent sale of the property, the proceeds redound to the coffers of the Commission. This is sufficient under the [ Gibson v.] Berryhill rule to mandate disqualification of the Commission ... and require that the reverter proceedings provisions of the statute be held unconstitutional.); see also Ward v. Village of Monroeville, 409 U.S. 57, 59-60, 93 S.Ct. 80, 34 L.Ed.2d 267 (1972) (concluding that the city mayor was an unconstitutionally biased adjudicator where fines he imposed for traffic offenses provided a substantial portion of village funds). 28 Even if such structural bias, standing alone, did not implicate Gibson, it is accompanied here by undisputed evidence of actual bias that the district court described as overwhelming. That evidence included the unprecedented amount of the proposed fine, biased hearing examiners, and general unfairness throughout the hearings. Esso also submitted evidence of procedural irregularities in the decision to assess the fine, pressure by the Puerto Rico Senate to penalize Esso, and the improper influence on the EQB of Belgodere, Rodriguez's consultant. Taken together, these factors demonstrate that, in the words of the district court, the EQB does not measure up to the yardstick of what an impartial adjudicator should be in accordance with Due Process. This bias may well render the EQB incompetent by reason of bias to adjudicate the issues pending before it. Gibson, 411 U.S. at 577, 93 S.Ct. 1689.
29 The presence of bias does not, however, end our inquiry; federal intervention is only appropriate where the petitioner also demonstrates irreparable harm. Maymo-Melendez, 364 F.3d at 37-38. Thus, although [s]ubmission to a fatally biased decisionmaking process is in itself a constitutional injury, United Church, 689 F.2d at 701, we must also consider whether Esso has access to state judicial review that would make federal intervention unnecessary. That question turns on the type and timeliness of judicial review available. We agree with the district court that Esso has not shown irreparable harm, although for a different reason. 30
31 The district court found that Esso had not shown irreparable harm because the EQB may yet adjudicate the case fairly. In addition, Esso is not without recourse. It still can resort to the state judicial review process and vindicate any rights it understands are violated by the administrative process. Esso contends that these factors do not ameliorate the constitutional injury it will suffer in being forced to continue proceedings before a biased adjudicator. We agree. 32 The district court's conclusion rested in part on Ohio Civil Rights Comm'n v. Dayton Christian Sch., Inc., 477 U.S. 619, 106 S.Ct. 2718, 91 L.Ed.2d 512 (1986). In that case, a private school asked the federal court to enjoin employment discrimination proceedings that allegedly violated the First Amendment. The school argued that under Ohio law, it could not present its constitutional claim regarding the investigation and potential sanction during the administrative proceedings and that the opportunity to do so during subsequent review by a state court was inadequate. The Supreme Court disagreed, concluding that it is sufficient ... that constitutional claims may be raised in state-court judicial review of the administrative proceeding. 477 U.S. at 629, 106 S.Ct. 2718. 33 The Court's reliance on the eventual availability of judicial review related specifically to the school's claim that any fine imposed on it would violate the First Amendment. 7 Eventual judicial review of the fine would adequately address the school's constitutional claims. In the present case, by contrast, Esso asserts that the proceedings themselves violate its constitutional rights. It emphasizes that submission to a biased adjudicator constitutes an ongoing, independent injury that requires immediate judicial relief. United Church, 689 F.2d at 701; see also Ward, 409 U.S. at 61-62, 93 S.Ct. 80 (Petitioner is entitled to a neutral and detached judge in the first instance.). Under these circumstances, Gibson itself indicates that the federal court need not abstain even if judicial review, de novo or otherwise, would be forthcoming at the conclusion of the administrative proceedings. 411 U.S. at 577, 93 S.Ct. 1689. 34 The district court's irreparable harm analysis may also reflect its misinterpretation of our recent decision in Maymo-Melendez. That case involved a challenge to the constitutionality of proceedings charging Maymo, a horse trainer, with two violations of the Puerto Rico Horse Racing Industry and Sport Administration's controlled medication program. 364 F.3d at 29. First, the Racing Board administrator concluded on November 3, 2000, after a series of hearings, that Maymo had improperly administered the drug Clenbuterol and suspended Maymo's license to train horses for five years. Id. at 30. Maymo appealed the decision to Puerto Rico's Circuit Court of Appeals, which stayed the penalty pending resolution of the appeal but ultimately affirmed the decision on June 21, 2002. Id. The penalty was reimposed when the stay expired on July 11, 2002, and the Puerto Rico Supreme Court declined to review the case. Id. at 31 and n. 2. 35 While the Clenbuterol case was under review in state court, the Board administrator also initiated hearings on whether Maymo had improperly administered another drug, Tramadol. Id. at 30. The administrator ruled against Maymo on June 26, 2002 and imposed a five-year license suspension to run consecutively with the pending Clenbuterol suspension. Id. Maymo then filed a suit in federal district court seeking to enjoin both license suspensions on due process grounds, alleging that the Racing Board officials who conducted the hearings and imposed the suspensions were biased. Id. The district court granted a preliminary injunction, finding that Younger did not dictate abstention because neither proceeding was ongoing. 8 Id. at 32. 36 We reversed. With regard to the Clenbuterol case, we held that the Rooker-Feldman doctrine prohibited the collateral attack on a state court decision. 9 Id. at 34. As to the Tramadol case, we concluded that Younger mandated abstention because Maymo's failure to exhaust his state judicial remedies meant that the state proceedings were ongoing. We rejected Maymo's claim that abstention was inappropriate under Gibson, reasoning that even if Maymo's allegations were true, there was no constitutional urgency to his claims that required federal intervention. We explained that [s]o far as the Younger exceptions are concerned with the impact of the state proceeding independent of any final remedy ( e.g., to harass), the suspension order has already been entered.... Id. at 38, 91 S.Ct. 746. In other words, because the hearings had concluded and Maymo was no longer appearing before the allegedly biased adjudicator, he was not suffering an ongoing injury. In those circumstances, state judicial review was sufficient to protect his constitutional rights. 37 In the present case, by contrast, Esso is still engaged in proceedings before the Board that the district court has already characterized as not measur[ing] up to what an impartial adjudicator should be in accordance with Due Process. This circumstance constitutes an ongoing injury and raises a concern independent of any final remedy that is at the heart of the Younger exceptions. 10 Id. Thus, in the circumstances of this case, the availability of judicial review of a final agency decision is insufficient to avoid the irreparable harm that inheres in the biased administrative proceeding itself. 38
39 Esso contends that judicial review of an interlocutory agency decision is also insufficient to ameliorate the constitutional injury of appearing before a biased adjudicator. We believe that this claim misreads Gibson and is inconsistent with the principles of comity underlying our abstention doctrine. 40 As we have discussed, the Supreme Court held in Gibson that a federal injunction was appropriate where the state proceedings were administered by an agency incompetent by reason of bias to adjudicate the issues pending before it.... Nor, in these circumstances, would a different result be required simply because judicial review, de novo or otherwise, would be forthcoming at the conclusion of the administrative proceedings. 411 U.S. at 577, 93 S.Ct. 1689. Esso notes that the Court reached this decision without addressing the defendant's argument that the petitioner could obtain interlocutory relief through a state mandamus procedure for challenging biased adjudicators. Esso reasons that in permitting an injunction, the Court implicitly ruled that the federal courts may intervene despite the availability of interlocutory relief. 41 Such a broad reading of Gibson is unwarranted. The Court may have rejected the defendant's argument because of factors specific to the case or the nature of the interlocutory review available. In fact, the Court's explicit statement that federal intervention was proper regardless of the availability of judicial review at the conclusion of the administrative proceedings, 411 U.S. at 577, 93 S.Ct. 1689, without referring to interlocutory review, arguably means that the availability of interlocutory review would be grounds for Younger abstention in some cases. 42 Also, the rule that Esso urges would run directly counter to the respect for state judicial systems at the heart of Younger abstention. There is no reason to assume that, given the opportunity to review an interlocutory decision by the EQB, the courts of Puerto Rico will not protect Esso's due process right to an unbiased adjudicator as vigorously and expeditiously as would a federal court. See Middlesex County Ethics Comm., 457 U.S. at 431, 102 S.Ct. 2515 ([R]espect for the state processes, of course, precludes any presumption that the state courts will not safeguard federal constitutional rights.). Thus, we see no reason to intervene here if Esso has access to timely interlocutory state judicial review of its constitutional claim. 43
44 We begin the availability analysis by setting forth the statutory provisions governing Puerto Rico appellate courts' review of interlocutory orders of administrative agencies. 4 L.P.R.A. § 22k grants the Circuit Court of Appeals authority to review administrative resolutions and orders: 45 The Circuit Court of Appeals shall intervene in the following matters: 46 .... 47 (g) Through a writ of review to be issued in its discretion, of the decisions, regulations, orders and resolutions of any administrative agency, pursuant to the terms and conditions established by §§ 2101 et seq. of Title 3, known as the Uniform Procedures Act of the Commonwealth of Puerto Rico. 48 The Uniform Administrative Procedures Act defines the scope of judicial review of administrative orders, establishing when review is appropriate and who has standing to seek review. 3 L.P.R.A. §§ 2101 — 2201. 3 L.P.R.A. § 2172 provides that: 49 Any party which is adversely affected by a final order or resolution of an agency and who has exhausted all of the remedies provided by the agency ... may file a petition for review before the Circuit Court of Appeals.... 50 .... 51 An order or interlocutory decree of an agency ... shall not be directly [reviewable]. The interlocutory decree of the agency may be subject to a writ of error in the motion to review the order or final decision of the agency. 52 The plain language of this section requires both a final order and exhaustion of the administrative process before a party is entitled to judicial review. This language would seem to preclude interlocutory judicial review of Esso's constitutional claim at this stage of the proceedings. 53 Section 2172 is not as absolute as it may first seem. 3 L.P.R.A. § 2173 provides that: 54 The court may exempt a petitioner from having to exhaust any or all of the administrative remedies provided in case such remedy is inadequate or that requiring its exhaustion would cause irreparable harm to the petitioner ... or when a substantive violation of constitutional rights is alleged, or when it is useless to exhaust the administrative remedies due to an excessive delay in the procedures.... 55 Given this language, § 2173 may excuse the § 2172 exhaustion requirement in this case because of Esso's allegation and preliminary showing, supported by specific, well-defined facts, that the EQB penalty proceedings violate its right to due process. Oficina de la Procuradora del Paciente, 2004 T.S.P.R. 153, 162 D.P.R. ___ (2004) (certified translation). However, it still appears that § 2173 does not waive § 2172's finality requirement. Under the plain language of this section, Esso could argue that it would not have timely access to judicial review because it must continue proceedings before the biased EQB until a final order is entered. 56 The Puerto Rico Court of Appeals adopted this view in 2002 when it rejected Esso's interlocutory appeals of EQB rulings on the availability of discovery and a statute of limitations claim. In both cases, the court cited § 2172, noting that it may only review the orders or final resolutions of an agency. Esso Standard Oil Co. v. Junta De Calidad Ambiental, Nos. OA-01-AG-26 and OA-99-AG-109, 2002 WL 31122179, at  (P.R. Ct.App. Sept. 13, 2002); Esso Standard Oil Co. v. Junta De Calidad Ambiental, Nos. OA-01-AG-26 and OA-99-AG-109, 2002 WL 1438761, at  (P.R. Ct.App. May 1, 2002). 57 However, a September 2004 ruling by the Puerto Rico Supreme Court casts doubt on this interpretation of § 2172. In that decision, the court eschewed a plain text reading of § 2172, creating exceptions to the finality requirement that parallel the exhaustion exceptions delineated in § 2173 — including an exception for grave constitutional grievances. MCS Insurer, 2004 T.S.P.R. at ___, 162 D.P.R. at ___, 2004 WL 2212782. 58 In MMCS Insurer the court noted that the exhaustion and finality doctrines have an analogous scope and thus ordinarily, both enjoy the same exceptions. 2004 T.S.P.R. at ___, 162 D.P.R. at ___, 2004 WL 2212782. It acknowledged the 1997 amendment to § 2172 providing that [a]n interlocutory order or resolution of an agency is not directly [reviewable], but concluded on the basis of legislative history that the legislature had not intended to change the jurisprudential norm of parallel exceptions for exhaustion and finality requirements. 11 The Court explicitly discussed two exceptions in this context: cases where the agency lacks jurisdiction and the postponement would entail an irreparable harm or when the matter is strictly of law. 2004 T.S.P.R. at ___, 162 D.P.R. at ___. 59 In analyzing the claims before it, the court referred to an additional exception for alleged constitutional violations, suggesting that a sufficiently intense grievance, proved with specific, well defined facts would justify an exception to § 2172's finality requirement. 2004 T.S.P.R. at ___, 162 D.P.R. at ___, 2004 WL 2212782 (citing Guadalupe v. Saldana, 133 D.P.R. 42 (1993), and Mercado Vega v. U.P.R., 128 D.P.R. 273 (1991)). The court found this exception inapplicable in MCS Insurer because the alleged due process violations — the Office of the Patient's Advocate's failure to promulgate regulations delineating health care providers' obligations under Puerto Rico law — did not present an infraction of substantive or constitutional rights of such a magnitude that warrants doing away with the requirement of a final resolution from the agency for purposes of judicially reviewing its actions. 2004 T.S.P.R. at ___, 162 D.P.R. at ___, 2004 WL 2212782. 60 Because we must accept the Puerto Rico Supreme Court's interpretation of Puerto Rico law, we conclude that § 2172 does not bar Esso from seeking interlocutory review of its due process claim. See Johnson v. Fankell, 520 U.S. 911, 916, 117 S.Ct. 1800, 138 L.Ed.2d 108 (1997) (Neither [the United States Supreme] Court nor any other federal tribunal has any authority to place a construction on a state statute different from the one rendered by the highest court of the State.); Salemme v. Ristaino, 587 F.2d 81, 87 (1st Cir.1978) (It is well settled that the interpretation of a state statute is for the state court to decide and when the highest court has spoken, that interpretation is binding on federal courts.). Although the MCS Insurer court did not explain precisely what magnitude of constitutional violation would suffice to excuse § 2172's finality requirement, Esso's claim might well meet the standard. 61 The preliminary injunction hearing before the district court has already created a record supporting Esso's allegations with specific, well defined facts. 2004 T.S.P.R. at ___, 162 D.P.R. at ___. That record led the district court to conclude that the evidence submitted by Esso is not only undisputed, it is overwhelming. The appearance and the probability of actual bias cannot be ignored.... Clearly, the EQB does not measure up to the yardstick of what an impartial adjudicator should be in accordance with Due Process. Esso raised similar claims with the HE in a motion to dismiss the proceedings on due process grounds. That motion has been pending before the HE since November 2003, and was referred to the EQB Governing Board the following month. 62 The district court acknowledged that it is unclear how far the EQB would entertain Esso's constitutional objections. However, Esso now has the option of seeking interlocutory judicial review of its due process claim under the rule announced in MCS Insurer. That avenue for timely judicial review of Esso's constitutional grievance in state court obviates the need for federal intervention in this case pursuant to the Gibson exception to Younger abstention. 12 The district court's decision to abstain from enjoining ongoing state administrative proceedings was thus correct. 63 Affirmed.