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September 15, 1998

GEORGE P. RONIGER, Plaintiff, against H. CARL McCALL, individually and as Comptroller of the State of New York, and ROSEMARY SCANLON, individually and as State Deputy Comptroller for the City of New York, Defendants.


The opinion of the court was delivered by: SWEET

Sweet, D.J.

Defendants H. Carl McCall ("McCall") and Rosemary Scanlon ("Scanlon") (collectively, the "Defendants"), have moved pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure to dismiss this action on the grounds that the Eleventh Amendment to the Constitution bars the claims against Defendants in their official capacities, Defendants are immune from suit in their individual capacities on the claims alleged pursuant to 42 U.S.C. 1983, and the Complaint fails to state a claim under 42 U.S.C. § 1985(2).

 For the reasons set forth below, the motion is denied in part and granted in part. Specifically, the claim against McCall in his official capacity and the claim under § 1985(2) will not be dismissed, and the claim against Defendants in their individual capacities under § 1983 will be dismissed.


 Plaintiff George P. Roniger ("Roniger") is 60 years of age and received his Ph.D. in economics from Columbia University. In 1993, he was appointed to the position of Assistant Deputy Comptroller for New York City. Roniger remained employed in the New York State Comptroller's Office until his termination in 1994. Prior to his employment there, he worked at Citibank for 23 years, rising to Director of Regional Economics and Director of Corporate Public Issues.

 McCall was, at all times relevant to this action, Comptroller of the State of New York.

 Scanlon was, at all times relevant to this action, from September 1993 forward, initially the Assistant Deputy Comptroller for New York City and the senior official in the Office of the State Deputy Comptroller, and thereafter the Deputy Comptroller for New York City.

 Prior Proceedings

 Roniger filed his Complaint in this action on October 29, 1997, pursuant to § 1983 and § 1985(2). The First Amended Complaint (the "Complaint") was filed on May 8, 1998. Prior to the filing of that Complaint, Defendants filed a motion to dismiss on April 13, 1998. The parties thereafter entered a stipulation stating that Defendants consented to the filing by Roniger of the Complaint simultaneously with the filing of the stipulation withdrawing the April 13 motion to dismiss, and the instant motion was filed on May 8, 1998, the day on which the Complaint was filed. Oral arguments were heard on June 17, 1998, at which time the motion was deemed fully submitted.


 In considering a motion to dismiss, the facts alleged in the complaint are presumed to be true and all factual inferences must be drawn in the plaintiff's favor and against the defendants. See Scheuer v. Rhodes, 416 U.S. 232, 236, 40 L. Ed. 2d 90, 94 S. Ct. 1683 (1974); Mills v. Polar Molecular Corp., 12 F.3d 1170, 1174 (2d Cir. 1993); Cosmas v. Hassett, 886 F.2d 8, 11 (2d Cir. 1989); Dwyer v. Regan, 777 F.2d 825, 828-29 (2d Cir. 1985). Accordingly, the factual allegations considered here and set forth below are taken from Roniger's Complaint and do not constitute findings of fact by the Court. They are presumed to be true only for the purpose of deciding the present motion.

 In May 1993, McCall, the Comptroller of New York State, appointed Roniger to the position of Assistant Deputy Comptroller for New York City, the second highest ranking position in the Office of the State Deputy Comptroller for the City of New York ("OSDC"), a division of the State Comptroller's Office. At that time, the top position at OSDC, that of Deputy Comptroller for New York City, was vacant. Thus, Roniger, in his capacity as Assistant Deputy, was "initially in charge of the office." (Compl. P 30.) In his position, Roniger met regularly with McCall and First Deputy Commissioner Comer S. Coppie. In addition, Roniger accompanied McCall to high level meetings with City officials, and at McCall's direction, met with City officials on his own.

 The OSDC was created by the New York State Legislature in 1975 for the purpose of conducting independent and objective professional reviews of the budgets and financial plans of New York City. OSDC's reports were used and relied upon by City officials and counsel to the City, and by underwriters, issuers, brokers, dealers, and bankers in the private sector. Prior to the appointment of McCall as Comptroller, OSDC had the well-deserved reputation for monitoring the City's operating budget and financial plans in a professional and independent manner. After McCall's appointment, however, the office became highly politicized.

 On May 3, 1993, New York City Mayor David Dinkins ("Dinkins") released the City's new four-year Financial Plan. Dinkins and McCall were close political allies. McCall had served in the Dinkins' administration, and Dinkins had appointed McCall's wife as a deputy. Nonetheless, McCall initially criticized the plan. After McCall came under fire for his criticism from the Mayor and others, he never again publicly criticized the Mayor or the actions of the Dinkins' administration.

 On June 29, 1993, McCall sent a highly unusual letter to Standards & Poors, an agency that, at that time, was known to be reviewing the City's bond rating in an unfavorable light (the "June 1993 Letter"). The letter essentially recanted McCall's earlier criticism of the City's budget.

 Prior to sending this letter, McCall had sought Roniger's views. Roniger viewed this letter unfavorably and as potentially disastrous to the Comptroller because (1) it had demonstrable factual errors; (2) it was inconsistent with a prior OSDC report, which in keeping with the Comptroller's statutory responsibility, had provided an independent and accurate assessment of the City's finances; (3) it downplayed the City's fiscal difficulties; and (4) it was inappropriate for the Comptroller, who is a public official charged with the responsibility to independently review the City finances, to sign a letter drafted by a high level City official applauding fiscal actions undertaken by the City administration.

 In response to the Comptroller's solicitation of Roniger's view, Roniger returned a redrafted letter to him that removed the incorrect information and was consistent with the prior OSDC report. Some time later, Roniger learned that the letter had been sent to Standards & Poors in its original form, signed by McCall.

 In August 1993, McCall hired and nominated Scanlon to fill the top position at the OSDC. However, this appointment required confirmation by the New York State Senate, which long delayed consideration of her nomination while they reportedly investigated charges that McCall was politicizing the office. Therefore, in order to install and maintain Scanlon as the senior person at OSDC, McCall gave her Roniger's title of Assistant Deputy, which required that Roniger give up his title and assume a lower one. The Complaint supports that this was not a change of substance and that Roniger continued to be junior only to Scanlon within the OSDC, and to hold a policymaking position.

 One month later, four of the six highest ranking people at the OSDC, below Roniger, were fired. All of the fired staff members had worked on a draft report that was highly critical of the city budget. Three of the fired employees filed a lawsuit against McCall in federal court, for wrongful termination and retaliation, Fry v. McCall, No. 95 Civ. 1915 (the "Westmeyer Lawsuit"). They claimed that they were discharged for truthfully assessing the fiscal position of New York City at a time that McCall had political reasons to downplay the City's fiscal difficulties. They claimed that McCall sought to influence the reports in order to help Dinkins' reelection chances and terminated their employment when they objected.

 In August 1994, approximately three months before McCall faced reelection for Comptroller, the plaintiffs in the Westmeyer Lawsuit deposed Roniger in connection with the suit. Roniger did not volunteer to testify, but was advised by counsel for the Comptroller's Office that the plaintiffs in that case would be taking his deposition on August 12, 1994. Roniger believed that he had no choice but to attend.

 In response to questioning at the deposition, Roniger truthfully stated that McCall had never sought to influence the conclusions of reports drafted under Roniger's direction. Roniger was questioned at length about the June 1993 Letter, and it was during this questioning that his only criticism of McCall was voiced. The following question and answer transpired:

Q: Do you know whether the portion of the letter that you saw conformed to the statements contained in the various reports sent out by the Comptroller's office concerning the City Financial Plan?
A: As I recall from a distance, it was my view that the letter took too soft a position vis-a-vis the City.

 Shortly thereafter, in September 1994, the Bond Buyer, a newspaper serving the New York financial community, published an article headlined, "State Comptroller Downplayed plight of N.Y.C. Budget Woes, Top Aide Says." The Bond Buyer story stated, in relevant part:

... George Roniger ... recently said he had misgivings about the letter's content, and specifically, its description of the city's fiscal situation ... . The letter, according to the lawyers representing the former analysts gives credence to their charge that the firings were politically motivated ... .
... Several fiscal analysts interviewed for this article said the letter is unusual because it soft-pedals many of the city's fiscal woes, and because it was written with the assistance of the city officials. Parts of the letter even run counter to the tone and substance of reports produced by McCall's New York office ...
In his testimony, McCall said Roniger was responsible for "validity of any document that we produced that he was involved in."

 The Bond Buyer story was picked up by other newspapers, and the June 1993 Letter became the source of criticism of McCall in his 1994 campaign for Comptroller.

 Immediately following the Bond Buyer story, McCall and Scanlon conspired to humiliate Roniger and to remove him from the Comptroller's Office. Finally, on November 29, 1994, Scanlon went to Albany, where she met with senior officials of the Comptroller's Office, and on December 1, 1994, she announced that Roniger's employment was being terminated. According to Roniger, Scanlon and McCall both made the decision to terminate him as a direct consequence of his truthful testimony in the Westmeyer Lawsuit.

 McCall told Roniger that he would attempt to place him elsewhere in his office. However, McCall made no such efforts, and Defendants have interfered in ...

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