Court Opinion

ID: 13926
Source: CourtListenerOpinion
Date Created: 2010-04-25 06:31:10+00
Date Added: 2024-06-11T15:04:01.523255
License: Public Domain

UNITED STATES COURT OF APPEALS
                                   For the Fifth Circuit

                                           No. 97-30643
                                         Summary Calendar

                                  FRANK DARRYL STEWART ,

                                                                                   Plaintiff-Appellant,

                                              VERSUS

           JERRY J. LARPENTER, Sheriff; MARCEL J. NULL, Warden;
   TERREBONNE PARISH CONSOLIDATED GOVERNMENT; BARRY BONVILLAIN,
           Parish President; LINDA BABIN; STEPHEN LARUSSA AND
                        ASSOCIATES; WILLIAM F. DODD,

                                                                               Defendants-Appellees.

                            Appeal from the United States District Court
                               For the Eastern District of Louisiana
                                          (97-CV-915-E)
                                         December 23, 1997

Before WISDOM, WIENER, and DENNIS, Circuit Judges.

PER CURIAM:*

       Frank Darryl Stewart, a Terrebonne Parish pretrial detainee, filed this 42 U.S.C. 1983 suit

alleging that the Parish, the Sheriff, and other defendants deprived him of property in violation of the

Due Process Clauses of the Fifth and Fourteenth Amendments to the U.S. Constitution. The district

court dismissed this suit as frivolous under 28 U.S.C. 1915. We affirm in part, reverse in part, and

remand.

                                                   I.

       Upon entering the Terrebonne Parish Criminal Justice Complex on two separate occasions,

Stewart delivered the money in his possession to the parish prison officials. The prison officials hold

  *
   Pursuant to 5TH CIR. R. 47.5, the Court has determined that this opinion should not be published
and is not precedent except under the limited circumstances set forth in 5TH CIR. R. 47.5.4.

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this money until the time when the prisoner is to be released. According to Stewart’s complaint, the

prison officials pay the released inmate the exact amount of money that the inmate tendered upon

entering the prison. This was Stewart’s experience the first time he was arrested.

        Stewart is still in jail following his second arrest. Stewart alleges that the prison officials told

him that he had no right to handle his own financial affairs while he was in prison. He maintains that

the prison officials debited and credited his account incorrectly on several occasions. Stewart filed

suit seeking to recover for these losses as well as to force the prison officials to pay interest on inmate

accounts.

                                                    II.

        We review a § 1915 dismissal for abuse of discretion.2 Section 1915 authorizes the district

court to dismiss complaints that are frivolous or malicious, or that do not state a cause of action upon

which relief can be granted.3

        Neither negligent nor intentional deprivations of property by state officials violate the Due

Process Clause when the officials’ acts are random and unauthorized and state law provides adequate

post-deprivation remedies.4 Louisiana law provides an adequate mechanism to remedy both negligent

and intentional deprivations of property.5       Stewart’s complaint that the prison officials failed to

properly credit and debit his inmate bank account does not rise to the level of a due process violation.

                                                    III.

        Stewart’s allegation that the prison officials unconstitutionally took the interest from his

prison account is another matter, however. Stewart’s complaint alleges a standard practice of placing

prisoner’s funds in the sheriff’s accounts without giving the prisoners the interest earned on those

   2
        Eason v. Thaler, 14 F.3d 8, 9-10 (5th Cir. 1994).
   3
        28 U.S.C. § 1915 (e)(2)(B).
   4
        Hudson v. Palmer, 468 U.S. 517, 532-4 (1984).
   5
       Marshall v. Norwood, 741 F.2d 761, 764 (5th Cir. 1984); La. Civil Code Ann. art. 2315
(West 1997).

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funds. According to the complaint, these are not random events that fall under the rule applied above.

        To state a claim based upon the taking of property under the Due Process Clause, Stewart

must allege that he was deprived of a protected property interest.6 Property interests are created and

defined by state law.7 In Louisiana, the general rule is that interest earned on funds held by a

depository institution belongs to the owner of the principal, and not the depository institution.8 The

depository institution is to hold the principal and interest; it cannot make use of the funds for its own

benefit without the express or implied consent of the depositor.9 Based upon these principles, the

Louisiana Attorney General’s Office issued opinion No. 88-619 on March 10, 1989 concluding that

“[a]ny and all interest income received from the investment of the inmate’s money is the property of

the inmate for his sole use and benefit.”

        In 1990, the Louisiana legislature modified these rules with respect to inmate accounts.10 “All

past and present interest income earned from the investment of inmates’ money shall be deposited in

the fund established for the benefit of all inmates, pursuant to R.S. 15:866.2. The interest earned may

be used to help defray administrative costs, to seed new institutions’ inmate welfare funds, and to

provide for other expenditures which will benefit the inmate population.” This new provision reverses

the conclusion envisioned by the Attorney General in Opinion No. 88-619. Assuming that the new

provision is constitutional, an inmate does not have a protected property interest in the interest earned

on funds deposited with prison officials.11

   6
        Board of Regents v. Roth, 408 U.S. 564, 569 (1972).
   7
        Id. at 577.
   8
La. Civ. Code Ann. art. 2948 (West 1997).
   9
La. Civ. Code Ann. art 2940 (West 1997).
   10
        See La. Rev. Stat. Ann. § 874 (West 1997) (historical and statutory notes).
   11
       Several other courts have addressed similar issues in cases from other states. For example,
one court found that Nevada law created a property interest in the interest earned on inmate funds.
See Tellis v. Godinez, 5 F.3d 1314, 1316-7 (9th Cir. 1993). Other courts reached the opposite
conclusion when applying California and Indiana law. See Schneider v. Cal. Dept. of Corrections,
957 F.Supp 1145, 1147-9 (N.D. Cal. 1997); Hendrix v. Evans, 715 F.Supp 897, 910-11 (N.D. Ind.

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        We reverse the district court’s dismissal of this suit, however, because we find that Stewart

has raised a legitimate constitutional challenge to the practice authorized by La. R.S. § 874(5).

Because we read pro se complaints liberally, we find that Stewart’s complaint challenges the statute

itself. This challenge is not frivolous.12 Both the U.S. Supreme Court and this Court have found state

statutes and rules authorizing the transfer of interest from the principal owner to the state to be

unconstitutional. In Webb’s Fabulous Pharmacies, Inc. v. Beckwith, the Supreme Court held a

Florida statute authorizing the state to retain interest earned on funds deposited with the clerk in an

interpleader action to be unconstitutional.13 In Washington Legal Foundation v. Texas Equal Access

to Justice Foundation, this Court held the Texas IOLTA program to be unconstitutional because it

authorized the use of interest earned on client trust fund accounts to be used for the benefit of the

public at large without compensating the client.14 These cases provide at least an arguable basis for

the Louisiana statute’s unconstitutionality. It may be that these cases are distinguishable from the

facts in the present case or that the use of funds for the benefit of the prisoners may save this

provision. This is not an issue that we address absent a full opportunity for the two adverse paries

to brief the merits of this challenge.15

                                                  IV.

        The district court abused its discretion in dismissing Stewart’s due process claim for the

taking of interest as frivolous. The district court did not err in dismissing the remaining claims.

        We AFFIRM in part, REVERSE in part, and REMAND for further proceedings.

1989), aff’d 972 F.2d 351 (7th Cir. 1992). These decisions do not conflict because each is tied to
state law.
   12
        See Eubanks v. McCotter, 802 F.2d 790, 793-4 (5th Cir. 1986).
   13
        449 U.S. 155 (1972).
   14
        94 F.3d 996 (5th Cir. 1996), cert. granted, 117 S. Ct. 2535 (1997).
   15
       Because this is a challenge to the constitutionality of the statute, the interest of the state of
Louisiana must also be considered. 28 U.S.C. § 2403(b).

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