Court Opinion

ID: 9554438
Source: CourtListenerOpinion
Date Created: 2023-08-08 22:00:49.996935+00
Date Added: 2024-06-11T15:34:00.001730
License: Public Domain

In the

    United States Court of Appeals
                For the Seventh Circuit
                    ____________________
No. 22-2469
RAHUL MALHOTRA,
                                                 Plaintiff-Appellant,
                                v.

UNIVERSITY OF ILLINOIS AT URBANA-CHAMPAIGN, et al.,
                                     Defendants-Appellees.
                    ____________________

        Appeal from the United States District Court for the
                    Central District of Illinois.
          No. 2:21-cv-02220 — Joe Billy McDade, Judge.
                    ____________________

     ARGUED APRIL 25, 2023 — DECIDED AUGUST 8, 2023
                ____________________

   Before RIPPLE, ST. EVE, and PRYOR, Circuit Judges.
    PRYOR, Circuit Judge. After ﬁnding that Rahul Malhotra
had hosted a party during the COVID-19 pandemic, the
University of Illinois at Urbana-Champaign suspended him
for two semesters. Malhotra sued the University and several
of its oﬃcials under 42 U.S.C. § 1983, alleging Due Process
2                                                         No. 22-2469

violations under the Fourteenth Amendment. 1 The district
court dismissed the suit, concluding that Malhotra had failed
to adequately plead the requisite property or liberty interest
to state a due process claim. We aﬃrm.
                         I.   BACKGROUND
    In reviewing the dismissal of Malhotra’s complaint, we
take his allegations as true and view them in the light most
favorable to him. Muskegan Hotels, LLC v. Patel, 986 F.3d 692,
695 (7th Cir. 2021). Malhotra subleased a room in a fraternity
house while attending the University of Illinois at Urbana-
Champaign in January 2021. The University prohibited
students from permitting underage drinking in their
residences. At the time, because of the COVID-19 pandemic,
the University also restricted the number of people who could
attend social gatherings.
    According to Malhotra, a few days after he moved in,
other residents of the fraternity house decided to throw a
party. Malhotra was not involved in planning or hosting the
party, and he had been assured by its organizers that the party
would comply with the University’s COVID restrictions. The
night of the event, Malhotra was wearing noise-canceling
headphones and studying in his ﬁrst-ﬂoor room when his
roommate alerted him to loud noises coming from upstairs.
Malhotra investigated and discovered a large group of people
partying, including a young woman who was visibly
intoxicated. The party ended after police oﬃcers and campus
patrol arrived at the house.

    1Malhotra also brought Fifth Amendment claims, but he does not
pursue these claims on appeal, meaning any arguments relating to them
are waived. O'Neal v. City of Chicago, 588 F.3d 406, 409 (7th Cir. 2009).
No. 22-2469                                                  3

    The next week, the University charged Malhotra and other
residents of the fraternity house with violating the
University’s code of conduct by disregarding COVID
restrictions and allowing underage drinking. Malhotra met
with Rony Die, the University’s Assistant Dean of Students,
and explained that he had been studying in his room and had
nothing to do with the party. After the meeting, Malhotra was
notiﬁed that he would have a hearing before the
“Subcommittee on Undergraduate Student Conduct” to
determine whether he was responsible for the violations.
Malhotra appeared at the hearing, testiﬁed in his defense, and
answered questions from the subcommittee.
   Several weeks later, the subcommittee found Malhotra
guilty of all charges and suspended him for two semesters.
Dean Die explained to Malhotra that he had been held
responsible because he was a signatory on the fraternity
house’s lease.
   Malhotra, however, had not signed the lease; he had
merely subleased a room. He appealed the subcommittee’s
decision, attaching a copy of the lease as evidence. The
suspension was upheld.
    Malhotra then ﬁled suit under 42 U.S.C. § 1983. In the
second amended complaint, Malhotra named as defendants
the University of Illinois at Urbana-Champaign, as well as
several University staﬀ in their personal and oﬃcial capacities
including Dean Die. He argued that the University’s decision
to suspend him for two semesters violated his Fourteenth
Amendment rights because the University failed to give him
a proper hearing as outlined in its student code. As a remedy,
Malhotra sought money damages from the individual
defendants. He also sought an injunction, against both the
4                                                          No. 22-2469

individual defendants and the University, that would require
them to expunge the disciplinary charges from his record.
    The district court granted the defendants’ motion to
dismiss the complaint for failure to state a claim. FED. R. CIV.
P. 12(b)(6). The court ruled that Malhotra’s claim against the
University—an alter ego of the state—was not cognizable,
and that his claims against Dean Die and other oﬃcials failed
because he did not allege a constitutionally protected
property or liberty interest as required under the Fourteenth
Amendment. Malhotra appeals.
                          II.    DISCUSSION
    This court reviews de novo the grant of a motion to
dismiss under Federal Rule of Civil Procedure 12(b)(6).
Peterson v. Wexford Health Sources, Inc., 986 F.3d 746, 751
(7th Cir. 2021).
                                   A.
   Malhotra sought diﬀerent types of relief against three
categories of defendants: (1) injunctive relief against the
University, (2) injunctive relief against Dean Die and staﬀ
members in their oﬃcial capacities, and (3) monetary relief
against Dean Die and staﬀ members in their personal
capacities. 2 Before considering the speciﬁcs of his allegations,
we must ﬁrst sort out who was a proper party to the lawsuit.

    2 These are the forms of relief that Malhotra requested in his “prayer
for relief” in the second amended complaint. Because another section of
the second amended complaint could be read to suggest that Malhotra
also sought monetary relief against the individual defendants in their
official capacities, it is important to note that these damages are
unavailable. Section 1983 does not allow awards of damages against
No. 22-2469                                                                  5

    Section 1983 allows a plaintiﬀ to sue a “person” who,
acting under color of state law, has violated the plaintiﬀ’s
constitutional rights. Jones v. Cummings, 998 F.3d 782, 786 (7th
Cir. 2021). If successful, the plaintiﬀ may recover damages or
obtain injunctive relief. 42 U.S.C. § 1983.
    Malhotra’s claim for injunctive relief against the
University fails at the outset because the University is not a
“person” within the meaning of § 1983. The district court
concluded that the University is an alter ego of the state,
rather than a person, and Malhotra does not contest this
conclusion. See Haynes v. Indiana Univ., 902 F.3d 724, 731 (7th
Cir. 2018) (“The University and its Board of Trustees are state
agencies for sovereign-immunity purposes.”); Kaimowitz v.
Bd. of Trustees of Univ. of Illinois, 951 F.2d 765, 767 (7th Cir.
1991) (concluding that “a state university is an alter ego of the
state”). This is significant given § 1983 authorizes suits only
against “person[s].” Because the University is an alter ego of
the state, Malhotra could not sue it under this statute. Barnes
v. Bd. of Trustees of Univ. of Illinois, 946 F.3d 384, 391 (7th Cir.
2020); Holton v. Indiana Horse Racing Comm’n, 398 F.3d 928, 929
(7th Cir. 2005). Accordingly, to the extent Malhotra pursues
claims against the University under 42 U.S.C. § 1983, we
aﬃrm their dismissal.
   We turn next to Malhotra’s claims of injunctive relief
against the individual defendants in their oﬃcial capacities.
Even though we treat an oﬃcial capacity claim against a state
actor as a suit against the governmental unit for which the

states, and official-capacity suits against state actors are treated as suits
against the states themselves. Will v. Michigan Dep’t of State Police, 491 U.S.
58, 64, 70–71 (1989); Elim Romanian Pentecostal Church v. Pritzker, 22 F.4th
701, 703 (7th Cir. 2022).
6                                                              No. 22-2469

actor works (here, the State of Illinois), Bridges v. Dart, 950
F.3d 476, 478 (7th Cir. 2020), the exception established in Ex
parte Young, 209 U.S. 123 (1908), allows these claims to go
forward. Ex parte Young holds that a plaintiﬀ may sue a state
oﬃcial for prospective relief if the plaintiﬀ seeks to enjoin
ongoing violations of federal law. Id. at 159–60. The theory is
that an oﬃcial actively ﬂouting the law is representing only
himself, not the state. See Lukaszczyk v. Cook County, 47 F.4th
587, 604 (7th Cir. 2022) (describing the doctrine). Malhotra’s
oﬃcial capacity claims fall within the situation contemplated
by Ex parte Young: he seeks to compel state oﬃcials to expunge
his suspension from his record on grounds that their failure
to do so continues to violate his due process rights. See Doe
v. Purdue University, 928 F.3d 652, 666–67 (7th Cir. 2019)
(concluding that a student’s “marred [disciplinary] record” is
a continuing harm). 3
   Malhotra could also proceed against Dean Die and the
other staﬀ in their personal capacities for money damages.
Each was a “person” who Malhotra alleged violated his
constitutional rights.
    In sum, the University was not a proper defendant to the
suit, but the other defendants were. Thus, moving forward,

    3Ex parte Young applies only to state officials and therefore cannot
save Malhotra’s claim against the University. Puerto Rico Aqueduct & Sewer
Auth. v. Metcalf & Eddy, Inc., 506 U.S. 139, 146 (1993) (explaining that the
doctrine “has no application in suits against the States and their
agencies”); Peirick v. Indiana Univ.-Purdue Univ. Indianapolis Athletics Dep’t,
510 F.3d 681, 696 (7th Cir. 2007) (concluding that a plaintiff could not
proceed against the Board of Trustees of Indiana University “even on her
claims for prospective injunctive relief”).
No. 22-2469                                                       7

we will evaluate only Malhotra’s personal and oﬃcial
capacity claims against the individual defendants.
                                B.
    We turn now to Malhotra’s argument that the individual
defendants violated his procedural due process rights. The
Fourteenth Amendment prevents a state from depriving a
person of “property” or “liberty” without due process of law.
U.S. CONST. amend. XIV, § 1. A procedural due process
analysis therefore consists of two steps. First, we must
identify the protected property or liberty interest at stake.
Second, if the plaintiﬀ was deprived of one of those interests,
we must determine what process was due under the
circumstances. Charleston v. Bd. of Trustees of Univ. of Illinois at
Chicago, 741 F.3d 769, 772 (7th Cir. 2013). The district court
concluded that Malhotra’s claim failed at the ﬁrst step, and
we agree. Malhotra did not plausibly allege that the
defendants deprived him of a property or liberty interest.
                                 1.
    We ﬁrst address whether Malhotra adequately alleged
that the individual defendants deprived him of a
constitutionally protected property interest. In his complaint,
Malhotra asserted that he had a property interest in his
continued education because he “paid tuition.” On appeal, he
elaborates that he and the University entered into “an express
contract,” in which he paid tuition in exchange for a “promise
not to be expelled or suspended unless [he] violated the
institutional rules.”
   The problem with Malhotra’s argument is that attending a
university does not automatically create a constitutional
property right. Our cases establish that students do not have
8                                                    No. 22-2469

a stand-alone property interest in their continued education
at state universities. Charleston, 741 F.3d at 772. This is
because, unlike with grade schools, the law does not entitle
each person to an education at a public university. Purdue, 928
F.3d at 660. Rather, to have a legally protected entitlement to
continued education at a state university, a plaintiﬀ must
point to something more. He must not only allege the
existence of an express or implied contract, but he must also
establish that the contract “entitled him to the speciﬁc right
that the university allegedly took, ‘such as … the right not to
be suspended without good cause.’” Purdue, 928 F.3d at 660
(quoting Bissessur v. Indiana Univ. Bd. of Trustees, 581 F.3d 599,
601 (7th Cir. 2009)). Put simply, “the student’s complaint must
be speciﬁc about the source of this [express or] implied
contract, the exact promises the university made to the
student, and the promises the student made in return.”
Charleston, 741 F.3d at 773.
   Because Malhotra failed to suﬃciently plead that the
University oﬃcials violated a speciﬁc contractual right
between the parties, he did not allege a constitutionally
protected property interest in remaining enrolled at the
University. Despite having had multiple opportunities to
amend, Malhotra never provided the source of any express
contract, nor did he identify any speciﬁc promise by the
University or any promises he made to the University.
Instead, Malhotra alleged only that he paid tuition. Then he
assumes on appeal that his act of paying tuition created a
return promise from the University to either suspend him
only for good cause or to follow its own procedures when
deciding whether to suspend him. Unfortunately for
Malhotra, our case law does not allow us to make this
assumption; he needed to allege facts that plausibly
No. 22-2469                                                              9

suggested the existence of an express or implied contract.
Because Malhotra failed to meet the threshold requirement of
alleging that the individual defendants deprived him of a
constitutionally protected interest, our analysis ends there,
and we cannot review whether the defendants followed the
University’s internal process in deciding to suspend him. See
Charleston, 741 F.3d at 773 (holding that a plaintiﬀ does not
have a constitutional right to state-mandated process).
   In sum, because Malhotra has not alleged that he had a
constitutionally protected property interest, we cannot
evaluate whether the actions of the University oﬃcials
unfairly stripped him of any such interest.
                                    2.
    We turn now to whether Malhotra adequately alleged that
the individual defendants deprived him of a constitutionally
protected liberty interest. Malhotra alleged that he had a
liberty interest in pursuing his chosen career of a healthcare
consultant, and that the defendants will “invariably” disclose
his disciplinary record to any graduate school or employer to
which he applies. On appeal, he maintains that the
suspension adversely aﬀected his pursuit of this career
because he “may suﬀer harm to his future career prospects.” 4
    To succeed on a claim that the defendants deprived him of
a liberty interest, Malhotra had to satisfy the “stigma plus”
test, which required him to allege both that he suﬀered a

    4 At oral argument, counsel did not mention the healthcare-
consultant-career plans alleged in Malhotra’s second amended complaint,
and instead stated that Malhotra wishes to pursue a law degree. Our
conclusion—that he failed to allege a loss of liberty—applies regardless of
his chosen vocation.
10                                                 No. 22-2469

reputational injury (“stigma”) and an alteration in legal status
that deprived him of a right he previously held (“plus”).
Mann v. Vogel, 707 F.3d 872, 878 (7th Cir. 2013). Liberty in the
Fourteenth Amendment includes the pursuit of “a trade,
profession, or other calling.” Lawson v. Sheriﬀ of Tippecanoe
County, 725 F.2d 1136, 1138 (7th Cir. 1984). In turn, a state
actor can violate the Constitution by depriving a plaintiﬀ of
his “occupational liberty”—his right to pursue a career of his
choice. Purdue, 928 F.3d at 661. That said, “the loss of
reputation is not itself a loss of liberty,” even when the
reputational loss causes a “serious impairment of one’s future
employment.” Purdue, 928 F.3d at 662 (citation and quotation
marks omitted). A state actor infringes on a liberty interest
only by “cast[ing] doubt on an individual’s … reputation” to
such a degree that “it becomes virtually impossible for the
[individual] to ﬁnd new employment in his chosen ﬁeld.”
Doyle v. Camelot Care Centers, Inc., 305 F.3d 603, 617 (7th Cir.
2002) (citation and quotation marks omitted).
    Malhotra’s allegations are too speculative to plausibly
suggest that it will be virtually impossible for him to pursue
a career as a healthcare consultant. Even if University oﬃcials
will “invariably” disclose his suspension to graduate schools
and employers, this at most suggests—as Malhotra’s brief
acknowledges—that his career prospects “may” be aﬀected.
After his suspension, Malhotra can return to the University,
graduate, and then apply to a variety of graduate schools or
jobs in the ﬁeld of his choice. He has not alleged that he
applied to these schools or jobs yet none would take him.
While we acknowledge that future schools and employers
might not look favorably on a suspension for violating the
University’s rules, it is far from clear that they would
reﬂexively turn Malhotra away for this reason. The
No. 22-2469                                                  11

allegations therefore do not suggest that the suspension will
make it impossible for him to become a healthcare consultant.
    When we have ruled that a defendant deprived a plaintiﬀ
of occupational liberty, the deprivation has been much more
certain. In Purdue, for example, the defendant’s decision to
brand the plaintiﬀ as a sex oﬀender resulted in his expulsion
from the Naval ROTC program and foreclosed his re-
enrollment in the program. Naturally, the plaintiﬀ’s chances
of pursuing naval service were thwarted. Purdue, 928 F.3d at
662–63; see also Mann, 707 F.3d at 878 (plaintiﬀ was deprived
of occupational liberty because she was prohibited from
operating her daycare center); Doyle, 305 F.3d at 617 (plaintiﬀs
were deprived of occupational liberty because a central
database, commonly relied on by employers, listed them as
child abusers). Here, by contrast, the facts in the complaint do
not plausibly suggest that the suspension will functionally
bar Malhotra from an entire ﬁeld of work.
    In sum, the allegations merely speculated about the
suspension’s stigmatizing eﬀect. The complaint therefore
failed to plausibly allege that the defendants deprived
Malhotra of the liberty guaranteed to him by the Constitution.
                     III.   CONCLUSION
    Because Malhotra did not meet the threshold requirement
of pleading a property or liberty interest, we AFFIRM the
district court’s judgment dismissing his complaint.