Opinion ID: 724019
Heading Depth: 1
Heading Rank: 1

Heading: jurisdiction

Text: 7 This appeal involves a state law indemnity cross-claim remaining after a verdict on federal claims brought pursuant to 42 U.S.C. § 1983. 1 Thus, although neither party raised a jurisdictional issue, we examine jurisdiction sua sponte. In the usual case where all federal claims are resolved, a district court should decline jurisdiction over the remaining state claims. Reynolds v. County of San Diego, 84 F.3d 1162, 1171 (9th Cir.1996). We review a district court's decision to retain jurisdiction over pendent claims when the original federal claims are dismissed for abuse of discretion. Brady v. Brown, 51 F.3d 810, 816 (9th Cir.1995). A court's exercise of supplemental jurisdiction, including pendent and ancillary jurisdiction, is governed by 28 U.S.C. § 1367. Section 1367(a) provides: 8 [I]n any civil action of which the district courts have original jurisdiction, the district courts shall have supplemental jurisdiction over all other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III of the United States Constitution. Such supplemental jurisdiction shall include claims that involve the joinder or intervention of additional parties. 9 However, a district court may decline to exercise supplemental jurisdiction over a claim under subsection 1367(a) if: 10 (1) the claim raises a novel or complex issue of State law, 11 (2) the claim substantially predominates over the claim or claims over which the district court has original jurisdiction, 12 (3) the district court has dismissed all claims over which it has original jurisdiction, or 13 (4) in exceptional circumstances, there are other compelling reasons for declining jurisdiction. 14 28 U.S.C. § 1367(c). 15 We find that the district court did not abuse its discretion in exercising jurisdiction over the cross-claims founded in state law. Koon and Powell's entitlement to reimbursement forms a part of the same case or controversy as King's claims against the City, Koon and Powell. Thus, the district court had jurisdiction under 28 U.S.C. § 1367(a). The district court has discretion in determining whether to decline exercise of such jurisdiction under the factors set forth in Section 1367(c). Executive Software v. U.S. District Court, 24 F.3d 1545, 1557 (9th Cir.1994). Once the district court identifies the presence of one of the Section 1367(c) factors, the court should consider whether the exercise of jurisdiction advances the values of economy, convenience, fairness, and comity. Id. (internal quotations omitted). 16 Two Section 1367(c) factors are present here. The state law indemnification claims involve a novel issue of California law: the definition of actual malice under Cal. Gov't Code § 996.4. In addition, all of the claims over which the district court had original jurisdiction have been resolved. Nonetheless, the values of economy, convenience and fairness are advanced by the district court's retention of jurisdiction over Koon and Powell's state law claims. The parties have already completed two trials. The same judge presided over both the complex criminal and civil trials and is intimately familiar with all of the facts and rulings. Given these circumstances, the district court did not abuse its discretion by retaining jurisdiction over the state law indemnification claims. 17 ACTUAL MALICE UNDER CALIFORNIA LAW 18 Under California law, a public entity is required to defend a public employee sued civilly for torts committed while in the course and scope of employment. Cal. Gov't Code § 995. The entity may refuse to represent a public employee if it believes that the act or omission was not within the scope of employment, or the employee acted or failed to act because of actual fraud, corruption, or actual malice. Cal. Gov't Code § 995.2. If after request a public entity refuses to provide an employee with a defense against a civil action, the employee may seek reimbursement of attorney's fees, costs and expenses if the act was in the scope of employment and the public entity is unable to establish that the employee acted or failed to act due to actual fraud, corruption or actual malice. Cal. Gov't Code § 996.4. 2 Koon and Powell seek reimbursement under Section 996.4. 19 This case presents a question of first impression under California law: what the words actual malice mean under Cal. Gov't Code § 996.4. Koon and Powell contend that to constitute actual malice, their actions must have been motivated by hatred or rancor. They argue that the record establishes that fear and the instinct for self-protection were the catalysts for their conduct. The City claims that only a deliberate wrongful intent is required. The district court agreed with the City's statutory interpretation. The court found that the criminal verdicts were sufficient to show that Koon and Powell were acting with actual malice and not entitled to reimbursement. 20 We review the district court's grant of judgment as a matter of law de novo. The Monotype Corporation v. International Typeface Corporation, 43 F.3d 443, 455 (9th Cir.1994). Where a state's highest court has not decided a legal issue, we must use our best judgment to predict how that court would decide it. General Motors Corporation v. Doupnik, 1 F.3d 862, 865 (9th Cir.1993). In analyzing the question, we may look to the decisions by the intermediate appellate courts of the state for guidance. Dimidowich v. Bell & Howell, 803 F.2d 1473, 1482 (9th Cir.1986), modified on other grounds, 810 F.2d 1517 (1987). However, we are not bound to follow such decisions. Doupnik, 1 F.3d at 865, n. 4. 21 The California courts have held that, The term 'actual malice' has different meanings, depending on the context in which it is used. Golden West Baseball Company v. Talley, 232 Cal.App.3d 1294, 1304 n. 7, 284 Cal.Rptr. 53 (1991). For example, Cal.Penal Code § 7 provides that [t]he words 'malice' and 'maliciously' import a wish to vex, annoy, or injure another person, or an intent to do a wrongful act, established either by proof or presumption of law. In the context of exemplary damages, malice means conduct which is intended by the defendant to cause injury to the plaintiff or despicable conduct which is carried on by the defendant with a willful and conscious disregard of the rights or safety of others. Cal. Civ.Code § 3294(c)(1). Actual malice is only defined in California statutes for the purpose of libel law. Cal. Civ.Code § 48a. 22 There is no statutory definition of malice or actual malice in the context of governmental indemnity. Similarly, direct legislative history is of no assistance. 3 There are no California intermediate appellate court decisions directly construing the meaning of actual malice under Section 996.4. The closest authoritative analysis is provided by Professor Arvo Van Alstyne, California's leading commentator on government tort claims. 4 In his treatise on the subject, Professor Van Alstyne states that to find actual fraud or actual malice as used in Section 996.4 requires showing personal animosity, malevolence, ill will, or deliberate wrongful intent on the part of the employee. A. Van Alstyne, California Government Tort Liability Practice app. 781 (1980). 23 Although they stated at oral argument that they did not necessarily disagree with Van Alstyne's definition, Powell and Koon argue that the better definition of actual malice is set forth in Schonfeld v. City of Vallejo, 50 Cal.App.3d 401, 123 Cal.Rptr. 669 (1975), overruled on other grounds, Morehart v. County of Santa Barbara, 7 Cal.4th 725, 743, 29 Cal.Rptr.2d 804, 872 P.2d 143 (1994). Schonfeld interprets Cal. Gov't Code § 822.2, which provides that a public employee acting in the scope of his employment is not liable for an injury caused by his negligent or intentional misrepresentation, unless he is guilty of actual fraud, corruption or actual malice. Schonfeld holds that the definition of actual malice for purposes of Section 822.2 is a conscious intent to deceive, vex, annoy or harm the injured party in his business. 50 Cal.App.3d at 410, 123 Cal.Rptr. 669. Powell and Koon argue that the term in his business should simply be excluded from the end of the Schonfeld definition for purposes of Section 996.4. However, the relevance of Schonfeld is very limited: it only involves the tort of misrepresentation and resulting commercial damage. It has only been cited in that context. 5 Because Section 996.4 deals with a much broader spectrum of civil actions than misrepresentation, the transferability of the Schonfeld interpretation of Section 822.2 to Section 996.4 is doubtful. 24 Thus, given the complete absence of meaningful legislative history or case law interpreting the statute, we conclude that the California Supreme Court would most likely employ Van Alstyne's interpretation of Section 996.4. In other words, the City must show personal animosity, malevolence, ill will, or deliberate wrongful intent on the part of the employee in order to establish the requisite actual malice under Section 996.4. Van Alstyne at 781. APPLICATION OF THE STANDARD 25 Having decided what the City must prove, we must determine whether the City met its burden. In analyzing whether actual malice had been established, the district court relied exclusively on the criminal verdicts. 6 The court properly disregarded the civil verdicts. In answer to a special interrogatory, the civil jury concluded that Koon and Powell acted with malice or in reckless disregard of King's rights. (emphasis added). The use of the coordinating conjunction or in the special interrogatory rendered the civil jury's verdict useless in determining whether the jury found actual malice. 26 However, the criminal verdict does provide a sound basis for finding actual malice as a matter of law. 7 The jury found Powell guilty of violating Count I, which charged him with willfully striking King and thereby willfully depriving King of the right to be free from the intentional use of unreasonable force by one making an arrest. 8 The jury found Koon guilty of violating Count II, which charged him with willfully failing to prevent an unlawful assault on King and thereby willfully depriving him of the right to be kept free from harm while in custody. 9 27 Federal law governs the collateral estoppel effect of a federal case decided by a federal court. Fireman's Fund Ins. Co. v. International Market Place, 773 F.2d 1068, 1069 (9th Cir.1985). Collateral estoppel applies where (1) the issue sought to be litigated is sufficiently similar to the issue present in an earlier proceeding and sufficiently material in both actions to justify invoking the doctrine; (2) the issue was actually litigated in the first case; and (3) the issue was necessarily decided in the first case. United States v. Weems, 49 F.3d 528, 532 (9th Cir.1995), citing United States v. Hernandez, 572 F.2d 218, 220 (9th Cir.1978). A civil litigant may be estopped from relitigating an issue that was directly determined in a previous criminal action. Bagley v. CMC Real Estate Corp., 923 F.2d 758, 762 (9th Cir.1991) (internal quotation omitted); see also Matthews v. Macanas, 990 F.2d 467, 468 (9th Cir.1993) (affirming dismissal of Bivens action based on preclusive effect of Fourth Amendment ruling in previous criminal action). 28 In order to reach its verdict, the criminal jury was required under Jury Instruction 10 to find that the defendant must have acted willfully, that is, with a specific intent to violate the protected constitutional right and that the offense must have resulted in bodily injury. The constitutional rights at issue were the right to be free from the intentional use of unreasonable force by one making an arrest and the right to be free from harm while in official custody. The criminal jury was required under Jury Instruction 16 to find that the defendant intended to accomplish that which the Constitution forbids. 10 Put another way, the jury found that Powell intentionally used unreasonable force and Koon intended to allow King to be harmed while in custody. The district court did not err in holding that these jury findings were sufficient to constitute the deliberate wrongful intent necessary for a determination of actual malice under Section 996.4. 29 Further, a Court of Appeals may take notice of proceedings in other courts, both within and without the federal judicial system, if those proceedings have a direct relation to matters at issue. United States ex rel. Robinson Rancheria Citizens Council v. Borneo, 971 F.2d 244, 248 (9th Cir.1992) (internal citations omitted). In this instance, the district court's sentencing opinion adds additional support to the criminal jury findings. In its decision on sentencing in the criminal trial, the district court stated: 30 [T]he evidence presented at trial and the verdicts clearly demonstrate that defendant Powell used the side-handle baton, and defendant Koon permitted its use, with the intent to harm Mr. King. Guidelines Section 2A2.2 distinguishes a situation in which a deadly weapon is used with intent to do bodily harm, from one in which it is used merely to frighten.... By itself, Powell's repeated use of the metal side-handle baton to strike Mr. King while King was no longer a threat is evidence that Powell intended to inflict bodily harm on Mr. King....Additionally, as defendant Koon testified at trial, he intended Powell to use the baton as an impact weapon to gain pain compliance, and then to cripple King and break [King's] bones. See R.T., 3/ 25/93, at 11 & .... Based on this testimony and the evidence of Powell's conduct, the Court is persuaded that Powell used the baton, and Koon permitted its use, with the intent to harm Mr. King, not merely to frighten him. 31 Because the relevant conduct attributable to both defendants Koon and Powell constitutes a felonious assault involving a dangerous weapon with intent to do bodily harm, the appropriate underlying offense is aggravated assault. 32 United States v. Koon, 833 F.Supp. 769, 781-782 (C.D.Cal.1993) (citations omitted), aff'd in part, vac. in part, 34 F.3d 1416 (9th Cir.1994), aff'd in part, rev'd in part, --- U.S. ----, 116 S.Ct. 2035, 135 L.Ed.2d 392 (1996) (Nos.94-1664, 94-8842). The district court's findings on these issues were not disturbed by the Ninth Circuit or the Supreme Court on appeal. Id. 33 Thus, both the criminal verdict and the sentencing opinion are a basis for collateral estoppel on the issue of whether Koon and Powell acted with actual malice under the statute. The question of whether Koon and Powell acted with deliberate wrongful intent is sufficiently similar to the issues in the criminal case; the question of intent was actually litigated in that case; and such question was necessarily decided in the criminal action--both in the criminal verdict and in the sentencing opinion. Accordingly, collateral estoppel can be properly applied to the pivotal factual question in this case. 34 Koon and Powell claim the City must prove they had personal animosity, malevolence or ill will toward King. They argue that the criminal verdict did not determine that issue and collateral estoppel cannot apply. This reasoning confuses motive with intent. The two are not synonymous. People v. Chapman, 261 Cal.App.2d 149, 177-178, 67 Cal.Rptr. 601, 619 (1968). Motive is the moving course, the impulse, the desire that induces the defendant to criminal action. State v. Willis, 632 S.W.2d 63, 65 (Mo.App.1982). It is distinguished from intent, which is the purpose to use a particular means to effect a certain result. State v. Stevens, 93 Idaho 48, 454 P.2d 945, 950 (1969). 35 The actual motive Koon and Powell may have had is irrelevant to their intent. Deliberate wrongful intent is not measured by the defendant's secret motive, whether that be hostility or fear. Rather, in circumstances such as these, deliberate wrongful intent must be judged objectively from the visible conduct of the defendant. See United States v. Guilbert, 692 F.2d 1340, 1344 (11th Cir.1982) (discussing intent in federal criminal context), cert. denied, 460 U.S. 1016, 103 S.Ct. 1260, 75 L.Ed.2d 487 (1983); Shaffer v. United States, 308 F.2d 654, 655 (5th Cir.1962) (same), cert. denied, 373 U.S. 939, 83 S.Ct. 1544, 10 L.Ed.2d 694 (1963). Powell was convicted of unlawfully intending to harm King through the use of unreasonable force. Koon was convicted of unlawfully intending to allow King to be harmed while in custody. As a matter of law, these actions were done with deliberate wrongful intent and, hence, the requisite actual malice under the statute. 36 Our statutory interpretation and its application in this case is consistent with sound public policy. When law enforcement officers betray the public trust and commit criminal acts with deliberate wrongful intent, the public should not be required to indemnify them. 37 The judgment of the district court is AFFIRMED.