Court Opinion

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Opinions of the United
2009 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit

1-28-2009

Paul McGovern v. City of Philadelphia
Precedential or Non-Precedential: Precedential

Docket No. 08-1632

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                                   PRECEDENTIAL

  UNITED STATES COURT OF APPEALS
       FOR THE THIRD CIRCUIT

                 No. 08-1632

            PAUL MCGOVERN,
                         Appellant

                      v.

         CITY OF PHILADELPHIA

On Appeal from the United States District Court
   for the Eastern District of Pennsylvania
           (D.C. No.: 07-cv-03817)
 District Judge: Honorable Paul S. Diamond

  Submitted Under Third Circuit LAR 34.1(a)
              January 8, 2009
 Before: CHAGARES and HARDIMAN, Circuit Judges and
               ELLIS,* District Judge

                  (Filed: January 28, 2009)

Mark S. Scheffer
Suite 1B
50 West Welsh Pool Road
Exton, PA 19341
       Attorney for Appellant

Eleanor N. Ewing
City of Philadelphia
Law Department
17th Floor
1515 Arch Street
One Parkway
Philadelphia, PA 19102-0000
       Attorney for Appellee

                OPINION OF THE COURT

      *
        The Honorable Thomas Selby Ellis, III, Senior District
Judge for the United States District Court for the Eastern
District of Virginia, sitting by designation.

                                2
HARDIMAN, Circuit Judge.

       In this appeal we consider whether a private right of
action against state actors can be implied under 42 U.S.C.
§ 1981. We join five of our sister circuits in holding that it
cannot.

                                I.

        Paul McGovern, a Caucasian male, was hired by the City
of Philadelphia (City) as an Administrative Support Specialist
in 1994 and was promoted to Network Administrator in 2001.
On September 25, 2003, McGovern filed a complaint of race
discrimination with the Equal Employment Opportunity
Commission (EEOC) pursuant to Title VII, 42 U.S.C. § 2000e,
et seq. A year later, McGovern received a Right to Sue Letter
from the EEOC, but took no further action on his Title VII
claim.1

       On December 21, 2004, the City terminated McGovern’s
employment, citing performance and behavioral deficiencies.
Almost three years later, McGovern sued the City in the United
States District Court for the Eastern District of Pennsylvania,

       1
         A claimant is required to file a Title VII suit within 90
days of receiving a Right to Sue Letter. 42 U.S.C. § 2000e-
5(f)(1); Seitzinger v. Reading Hosp. & Med. Ctr., 165 F.3d 236,
239 (3d Cir. 1999).

                                3
alleging race discrimination in violation of 42 U.S.C. § 1981.2
The City moved to dismiss pursuant to Federal Rule of Civil
Procedure 12(b)(6), arguing that § 1981 does not provide a
cause of action — either express or implied — against state
actors. The District Court granted the City’s motion and
McGovern filed a timely appeal.

                               II.

        The District Court had jurisdiction over McGovern’s civil
rights claim under 28 U.S.C. § 1331 and 28 U.S.C. § 1343(a)(3).
Appellate jurisdiction exists pursuant to 28 U.S.C. § 1291 and
we exercise plenary review over the District Court’s order
granting the City’s Rule 12(b)(6) motion. Edgar v. Avaya, Inc.,
503 F.3d 340, 344 (3d Cir. 2007). We accept all well-pleaded
allegations in the complaint as true and draw all reasonable
inferences in McGovern’s favor. Miller v. Fortis, 475 F.3d 516,
519 (3d Cir. 2007). The District Court’s judgment is proper
only if it is clear that “no relief could be granted under any set
of facts that could be proved consistent with the allegations.”
Brown v. Card Serv. Ctr., 464 F.3d 450, 456 (3d Cir. 2006)
(quoting Hishon v. King & Spalding, 467 U.S. 69, 73 (1984)).

       2
        In addition to abandoning his Title VII suit, McGovern
concedes that any potential claim under 42 U.S.C. § 1983 would
be barred by its two-year statute of limitations. Sameric Corp.
v. City of Philadelphia, 142 F.3d 582, 599 (3d Cir. 1998).

                                4
                                III.

        Having lost the opportunity to bring a timely claim under
either Title VII or 42 U.S.C. § 1983, McGovern seeks refuge
under 42 U.S.C. § 1981, which has a four-year statute of
limitations. See Jones v. R.R. Donnelley & Sons Co., 541 U.S.
369, 382 (2004) (citing 28 U.S.C. § 1658(a)). Conceding that
§ 1981 does not explicitly provide a private right of action,
McGovern argues that the rights-creating language of § 1981
implies a private right of action. In evaluating McGovern’s
argument, we must examine not only the rights-creating
language of § 1981, but we must also consider whether it
provides a remedy. As the Supreme Court acknowledged long
ago, this is not a matter of semantics: “The distinction between
rights and remedies is fundamental. A right is a well founded or
acknowledged claim; a remedy is the means employed to
enforce a right or redress an injury.” Chelentis v. Luckenbach
S.S. Co., 247 U.S. 372, 384 (1918).

        Like substantive federal law itself, private rights of action
to enforce federal law must be created by Congress. Touche
Ross & Co. v. Redington, 442 U.S. 560, 578 (1979).
Accordingly, we employ a two-step inquiry for determining
whether a private right of action exists under a federal statute:
(1) whether Congress intended to create a personal right in the
plaintiff; and (2) whether Congress intended to create a personal
remedy for that plaintiff. See Anderson v. Sandoval, 532 U.S.
275, 286 (2001); Three Rivers Ctr. v. Hous. Auth. of the City of
Pittsburgh, 382 F.3d 412, 421 (3d Cir. 2004). Only if we can
affirmatively answer both parts of the inquiry will we hold that

                                 5
an implied private right of action exists in a federal statute.
Wisniewski v. Rodale, Inc., 510 F.3d 294, 301 (3d Cir. 2007).

       A plaintiff asserting a violation of a federal statute must
address both aspects of this rights-remedies dichotomy. In
determining whether McGovern has met this burden, we first
look to the language of the statute:

       (a) Statement of equal rights

       All persons within the jurisdiction of the United
       States shall have the same right in every State and
       Territory to make and enforce contracts, to sue, be
       parties, give evidence, and to the full and equal
       benefit of all laws and proceedings for the
       security of persons and property as is enjoyed by
       white citizens, and shall be subject to like
       punishment, pains, penalties, taxes, licenses, and
       exactions of every kind, and to no other.

42 U.S.C. § 1981(a).

       In Jett v. Dallas Independent School District, 491 U.S.
701 (1989), the Supreme Court held that § 1981, while
providing extensive rights, does not itself provide a remedy
against state actors. Id. at 731. In Jett, a white high school
teacher and football coach sued his employer under § 1981 after
he was reassigned following a dispute with the school’s black
principal. The Supreme Court rejected Jett’s § 1981 claim,
holding that the exclusive federal remedy against state actors for
violation of rights guaranteed in § 1981 is 42 U.S.C. § 1983,

                                6
which provides that every person who, under color of law,
deprives another of “any rights, privileges, or immunities
secured by the Constitution and laws, shall be liable to the party
injured in an action at law, suit in equity, or other proper
proceeding for redress . . . .” See id. at 723, 735. Stated
differently, while § 1981 creates rights, § 1983 provides the
remedy to enforce those rights against state actors.

        In reaching its decision in Jett, the Supreme Court
examined the relationship between the Civil Rights Act of 1866
(which created the rights now enumerated in § 1981), and the
Civil Rights Act of 1871 (which enacted the precursor to
§ 1983). See Jett, 491 U.S. at 713-31. The Court concluded that
although the 1866 Act did not contain its own remedial
provision, Congress enacted the 1871 Act “to expose state and
local officials to a new form of liability” that did not exist under
§ 1981. Id. at 723. In other words, Congress believed the 1871
bill was necessary because no federal cause of action yet existed
to enforce civil rights violations by state actors. When a
rights-creating statute contains no express cause of action,
courts may either find that a private cause of action is implicit
in the rights-creating statute or that a means of enforcing that
right is contained elsewhere in federal law. See Arendale v. City
of Memphis, 519 F.3d 587, 594 (6th Cir. 2008). Even though
the rights-creating statute (§ 1981) contained no express cause
of action, the Supreme Court found that a means of enforcing

                                 7
that right against state actors existed in a separate federal
provision (§ 1983). Jett, 491 U.S. at 731.3

                               IV.

       McGovern acknowledges that Jett, standing alone,
precludes a § 1981 claim against a municipality. He argues,
however, that Jett was superseded by the Civil Rights Act of
1991, which amended § 1981 by adding two subsections that
provide:

       (b) “Make and enforce contracts” defined

       For purposes of this section, the term “make and
       enforce contracts” includes the making,
       performance, modification, and termination of
       contracts, and the enjoyment of all benefits,

       3
        By contrast, the Jett Court held that § 1981 created an
implied cause of action against private actors because no other
federal statute provided a remedy against them. Jett, 491 U.S.
at 732. Because § 1983 provided a remedy against persons
discriminating under color of state law, the Court declined to
read an implied cause of action against state actors into § 1981.
Id. The Court explained: “That we have read [§ 1981] to reach
private action and have implied a damages remedy to effectuate
the declaration of rights contained in that provision does not
authorize us to do so in the context of the ‘state action’ portion
of § 1981, where Congress has established its own remedial
scheme.” Id. at 731.

                                8
       privileges, terms, and       conditions   of   the
       contractual relationship.

       (c) Protection against impairment

       The rights protected by this section are protected
       against impairment by nongovernmental
       discrimination and impairment under color of
       State law.

42 U.S.C. § 1981(b), (c). While conceding that the amendments
did not establish an express cause of action, McGovern contends
that the addition of language protecting rights against
“impairment under color of State law” abrogated the holding in
Jett by creating an implied private right of action against state
actors beyond that provided by § 1983.

        Since its enactment, six circuits have considered whether
the Civil Rights Act of 1991 created an implied private right of
action. All but one of these courts have held that Congress did
not create such a cause of action in amending § 1981. Compare
Arendale, 519 F.3d at 598-99 (“[N]o independent cause of
action against municipalities is created by § 1981(c).”), Bolden
v. City of Topeka, 441 F.3d 1129, 1137 (10th Cir. 2006) (“We
therefore conclude that even after the 1991 amendments to
§ 1981, damages claims against state actors for § 1981
violations must be brought under § 1983.”), Oden v. Oktibbeha
County, 246 F.3d 458, 463-64 (5th Cir. 2001) (“[W]e are not
willing to deviate from the Supreme Court’s analysis of § 1981
in Jett.”), Butts v. County of Volusia, 222 F.3d 891, 894 (11th
Cir. 2000) (“§ 1981(c) makes clear that the section creates a

                               9
right that private or state actors may violate but does not itself
create a remedy for that violation.”), and Dennis v. County of
Fairfax, 55 F.3d 151, 156 n.1 (4th Cir. 1995) (“We do not
believe that [Jett] was affected by the Civil Rights Act of 1991,
which added subsection (c) to § 1981.”), with Fed’n of African
Am. Contractors v. City of Oakland, 96 F.3d 1204, 1214 (9th
Cir. 1996) (“[W]e conclude that the amended 42 U.S.C. § 1981
contains an implied cause of action against state actors, thereby
overturning Jett’s holding . . . .”).

       Without attempting to distinguish his case from the five
adverse appellate decisions, McGovern focuses upon the Ninth
Circuit’s opinion in City of Oakland. In finding that § 1981(c)
contained an implied remedy against state actors, the Ninth
Circuit Court reasoned that the goal of § 1981(c) was to ensure
“that § 1981 rights are to receive parallel protections against
state actors and private actors.” Id. at 1213. Accordingly, the
court stated:

       Because § 1981(c) affords identical protection
       against “impairment by nongovernmental
       discrimination” and “impairment under color of
       State law,” and because § 1981(c) implicitly
       codifies an implied cause of action against private
       defendants, we infer that § 1981(c) also contains
       an implied cause of action against state actors
       who “impair” a claimant’s § 1981 rights.

                               10
Id. at 1213 (emphasis in original). Because § 1981(c) implied
a right of action against private defendants, the Ninth Circuit
found that a comparable remedy was necessary to achieve
“parallel protection” for suits against public defendants. See id.

        In our view, the Ninth Circuit’s reasoning is inconsistent
with the logic of Jett, which held that courts should not imply
rights of action where Congress has already established a
different remedial scheme. See Jett, 491 U.S. at 731. In other
words, § 1981(c) can establish equal rights for parties against
private and state defendants without establishing equal
remedies; the fact that § 1981(c) establishes a private right of
action against private defendants does not lead to the conclusion
that a parallel right must exist for suits against state defendants
if such actions are provided for elsewhere in the statutory
scheme. See id. Indeed, federal courts often view the
availability of other enforcement mechanisms in a statutory
scheme as preclusive of an implied cause of action. See, e.g.,
Touche Ross & Co., 442 U.S. at 571-72.

        In assessing whether a private cause of action is implied
in a statute that does not expressly provide one, the Ninth Circuit
in City of Oakland applied the four-factor test established by the
Supreme Court in Cort v. Ash, 422 U.S. 66 (1975). That test
requires courts to consider: (1) whether the plaintiff is a member
of the class for whose “especial benefit” the statute was enacted;
(2) whether there was legislative intent to create such a remedy;
(3) whether implying a remedy would be consistent with the
underlying purposes of the legislative scheme; and (4) whether
this type of cause of action is traditionally relegated to state law.
Id. at 78.

                                 11
        In relying on Cort, however, the Ninth Circuit failed to
recognize, as we have done previously, that Cort has been
“altered . . . virtually beyond recognition” by subsequent
decisions of the Supreme Court. Wisniewski, 510 F.3d at 299.
For instance, in Cannon v. University of Chicago, 441 U.S. 677
(1979), the Supreme Court moved away from Cort’s multi-
factor analysis, instead focusing on the second Cort factor by
stating that its task is simply to determine whether “Congress
intended to make a remedy available.” Id. at 688. Later that
year, the Court declared: “The central inquiry remains whether
Congress intended to create, either expressly or by implication,
a private cause of action.” Touche Ross & Co., 442 U.S. at 575.
Thus, the interpretive task is “limited solely to determining
whether Congress intended to create the private right of action.”
Id. at 568. Finally, and most recently, in Anderson v. Sandoval,
532 U.S. 275 (2001), the Supreme Court established the
following method for determining whether an implied right of
action exists:

       The judicial task is to interpret the statute
       Congress has passed to determine whether it
       displays an intent to create not just a private right
       but also a private remedy. Statutory intent on this
       latter point is determinative. Without it, a cause
       of action does not exist and courts may not create
       one, no matter how desirable that might be as a
       policy matter, or how compatible with the statute.

                                12
Id. at 286-87 (internal citations omitted).4

       In the aftermath of Sandoval and its post-Cort
predecessors, we have made Congressional intent the “sole
touchstone of our inquiry.” Wisniewski, 510 F.3d at 303.
Though the Supreme Court has not provided a test for
discerning this intent, the Court has examined factors such as:
the text and structure of the statute; the existence or non-
existence of a comprehensive remedial scheme elsewhere in the
same statute; the statute’s legislative history; and Congress’s
explicit creation of private rights in similar statutes enacted
during the same time period. Id.

       We begin by assessing the text and structure of § 1981(c),
which provides that “[t]he rights protected by [§1981] are
protected against impairment by nongovernmental
discrimination and impairment under color of State law.”
Sandoval, 532 U.S. at 288. The Ninth Circuit placed great
weight on the inclusion of language protecting § 1981 rights
from impairment by both private and governmental entities. See
City of Oakland, 96 F.3d at 1213. We find this approach
wanting because it fails to recognize the distinction between
rights and remedies. The fact that § 1981(c) places an
individual’s rights on equal footing against discrimination by
private and public actors does not necessarily imply the
existence of an equal remedy against all defendants. See Butts,

       4
        Although the Supreme Court did not expressly reject the
Cort factors in Sandoval, it did not use them to guide its inquiry.
Wisniewski, 510 F.3d at 300.

                                13
222 F.3d at 894. This is especially true where, as here, Congress
has already provided an effective means of vindicating a
plaintiff’s rights elsewhere in federal law. See Jett, 491 U.S. at
731. The mere mention of “rights” does not, without more,
establish a private right of action. Arendale, 519 F.3d at 596.

        Going beyond the text and structure of the statute, the
legislative history of the Civil Rights Act of 1991 belies any
claim that Congress was concerned with Jett when amending the
statute. One of the stated purposes of the Act was “to respond
to recent decisions of the Supreme Court by expanding the scope
of relevant civil rights statutes in order to provide adequate
protection to victims of discrimination.” Civil Rights Act of
1991, § 3(4), Pub. L. No. 102-166, 105 Stat. at 1071 (1991).
The House Report on the bill explained that the Supreme Court
“cut back dramatically on the scope and effectiveness of civil
rights protections, and that as a result, existing protections and
remedies [were] not adequate to deter unlawful discrimination
or to compensate victims of intentional discrimination.” H.R.
Rep. No. 102-40(I), at 18 (1991), reprinted in 1991
U.S.C.C.A.N. 549, 556. Thus, we must determine whether Jett
was one of the decisions that Congress believed “cut back
dramatically” on civil rights protections.

       The legislative history shows that the addition of
subsection (b) was targeted at Patterson v. McLean Credit
Union, 491 U.S. 164 (1989), which Congress declared had a
“disastrous” impact on race discrimination claims by narrowly
interpreting the meaning of “make and enforce contracts” in
§ 1981. H.R. Rep. No. 102-40(II), at 36 (1991), reprinted in
1991 U.S.C.C.A.N. 694, 731. Patterson held that the “make and

                               14
enforce” language of § 1981 prohibited discrimination only at
the formation of a contract and did not prohibit racial
harassment on the job or other forms of race discrimination
occurring after the formation of a contract such as breach of the
terms of the contract or imposition of discriminatory working
conditions. See Patterson, 491 U.S. at 176-77. Dissatisfied
with this narrow reading, Congress added subsection (b) which
broadened the definition of “make and enforce” to include “the
making, performance, modification, and termination of
contracts.” 42 U.S.C. § 1981(b).

        More relevant to McGovern’s case, subsection (c) was
intended to codify Runyon v. McCrary, 427 U.S. 160 (1976), in
which the Supreme Court held that § 1981 prohibited intentional
racial discrimination in private, as well as public, contracting.
H.R. Rep No. 102-40(II), at 37 (1991). This reading comports
with the goals of the 1866 Act, which rendered all racial
discrimination illegal, even if it occurred in private. The
Supreme Court questioned Runyon’s holding in Patterson,
however, but ultimately decided not to overrule Runyon on
grounds of stare decisis. Patterson, 491 U.S. at 172-73. Wary
of the fact that future courts might not employ the principle of
stare decisis, Congress established § 1981(c) to codify the
holding of Runyon. See Arendale, 519 F.3d at 598. However,
this codification accounted for rights only; § 1981(c) created a
substantive right that both private and state actors must refrain
from violating, but the amendment did not create a remedy for
that violation. See Butts, 222 F.3d at 894.

      Nothing in the 1991 amendments or its legislative history
evinces Congress’s desire to alter the Supreme Court’s

                               15
conclusion in Jett, nor was Jett even mentioned despite the fact
that it was decided less than two years before Congress enacted
the 1991 Act. “[O]nly one who never relies on committee
reports would fail to be impressed by the total absence in the
committee reports of any mention of Jett . . . .” Bolden, 441
F.3d at 1137. Given the long-favored rule of statutory
construction that “repeals by implication are not favored,”
Fasano v. Fed. Reserve Bank of N.Y., 457 F.3d 274, 285 (3d Cir.
2006) (quoting Posadas v. Nat’l City Bank, 296 U.S. 497, 503
(1936)), we would expect much more than complete silence if
Congress intended to set aside such a notable ruling. See United
States v. Wasserson, 418 F.3d 225, 235 n.7 (3d Cir. 2005).

        In sum, because Congress neither explicitly created a
remedy against state actors under § 1981(c), nor expressed its
intent to overrule Jett, we hold that “the express cause of action
for damages created by § 1983 constitutes the exclusive federal
remedy for violation of the rights guaranteed in § 1981 by state
governmental units.” Jett, 491 U.S. at 833. Accordingly,
McGovern’s § 1981 claim must fail.

                               V.

       Even if we were to recognize a cause of action under
§ 1981, McGovern’s claim against the City was appropriately
dismissed for an independent reason: he did not allege that the
discrimination he suffered was pursuant to an official policy or
custom of the City. In Monell v. New York Department of
Social Services, 436 U.S. 658 (1978), the Supreme Court held
that a municipality may not be held vicariously liable for the
federal constitutional or statutory violations of its employees.

                               16
See id. at 694. “Instead, it is when execution of a government’s
policy or custom, whether made by its lawmakers or by those
whose edicts or acts may fairly be said to represent officially
policy, inflicts the injury that the government as an entity is
responsible under § 1983.” Id.

       Although Monell concerned § 1983 actions, the Supreme
Court in Jett extended Monell to cases arising under § 1981.
491 U.S. at 735-36. As even the Ninth Circuit recognized in
City of Oakland, the 1991 Act did not relieve plaintiffs of their
obligation under § 1981 to allege that their injury was caused by
an official policy or custom. 96 F.3d at 1205. Consequently,
McGovern was required to show that the City “implement[ed]
or execute[d] a policy statement, ordinance, regulation, or
decision officially adopted and promulgated,” or acted “pursuant
to governmental ‘custom’ even though such a custom has not
received formal approval through the body’s official decision-
making channels.” Monell, 436 U.S. at 690-91. Because
McGovern’s complaint fails to allege that the City’s employees
acted pursuant to an official policy or custom, the District Court
properly dismissed his claim.5

       5
        McGovern’s assertion that he should be entitled to
discovery in order to marshal facts to support his theory that the
City discriminated against him pursuant to an official policy or
custom is misguided. Our review of a motion to dismiss
pursuant to Federal Rule of Civil Procedure 12(b)(6) is limited
to the contents of the complaint. Yarris v. County of Delaware,
465 F.3d 129, 134 (3d Cir. 2006). Nowhere in his complaint
does McGovern allege that the City maintained a policy or

                               17
                               VI.

        “It is not the province of a federal court to confer rights
where statutory language is silent, or to ‘engraft a remedy on a
statute, no matter how salutary, that Congress did not intend to
provide.’” Am. Trucking Ass’n, Inc. v. Del. River Joint Toll
Bridge Comm’n, 458 F.3d 291, 302 (3d Cir. 2006) (quoting
California v. Sierra Club, 451 U.S. 287, 297 (1981)). Congress,
in promulgating § 1983 over a century ago, established that
section as the exclusive remedy for violations of § 1981 by state
actors. Nothing in the subsequent history, including the
amendments to the 1991 Act, changed that remedial scheme.
“[W]hatever the limits of the judicial power to imply or create
remedies, it has long been the law that such power should not be
exercised in the face of an express decision by Congress
concerning the scope of remedies available under a particular
statute.” Jett, 491 U.S. at 732. Accordingly, we join five of our
sister circuits in holding that no implied private right of action
exists against state actors under 42 U.S.C. § 1981. We affirm
the District Court’s grant of the City’s motion to dismiss.

custom to retaliate against or otherwise mistreat Caucasian
employees. Absent such an allegation, McGovern has not stated
a prima facie case, and the District Court properly dismissed the
claim without permitting discovery. See Marran v. Marran, 376
F.3d 143, 156 (3d Cir. 2004).

                                18