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Beechwood Restorative v. Laura E. Leeds

September 12, 2011


The opinion of the court was delivered by: David G. Larimer United States District Judge



This long-running case has its origins in a series of disputes between plaintiff Brook Chambery ("Chambery") and state and federal regulatory authorities over the operation of Beechwood Restorative Care Center ("Beechwood"), a nursing home owned by Chambery and his mother Olive Chambery (collectively "the Chamberys") in Rochester, New York. Those disputes, and the matters underlying those disputes, eventually led to Beechwood losing its state-issued operating certificate and closing in 1999.

In this action, which was commenced in 2002, the Chamberys and Beechwood brought various civil rights claims against seventeen state and two federal defendants, who were employed by the New York State Department of Health ("DOH") and the federal Health Care Financing Administration ("HCFA") respectively. Plaintiffs alleged, in short, that defendants had targeted Beechwood for closure in retaliation for Chambery's many complaints, protests, and lawsuits over the years, in which he challenged regulatory policies and practices that he considered wrongheaded, foolish, or unreasonable. Plaintiffs have alleged that defendants subjected Beechwood to continual nitpicking inspections and surveys, which they used to generate fodder for trumped-up allegations of deficiencies, which in turn provided the basis for the state's revocation of Beechwood's operating certificate.

While the full procedural history of this case would take several pages to recite, much of that history has been set forth in other decisions of this Court and of the Court of Appeals for the Second Circuit, familiarity with which is assumed. See 436 F.3d 147 (2d Cir. 2006); 494 F.Supp.2d 181 (W.D.N.Y. 2007); 317 F.Supp.2d 248 (W.D.N.Y. 2004). The full history of this litigation will therefore not be repeated here, and a short summary will suffice.

In 2004 this Court granted summary judgment for defendants, dismissing all of plaintiffs' claims. In 2006, the Court of Appeals for the Second Circuit affirmed in part and vacated and remanded in part this Court's decision. 436 F.3d 147. The court affirmed my dismissal of all of plaintiffs' claims, except for one: plaintiffs' First Amendment retaliation claim against the state defendants. The Court of Appeals remanded the action for further proceedings as to that single claim.*fn1

Case 6:02-cv-06235-DGL -JWF Document 266 Filed 09/12/11 Page 3 of 42

Additional discovery followed the Second Circuit's remand. In addition, the claims against two of the state defendants, Naomi Hauser and Joseph Moore, have been dismissed by stipulation of the parties. The remaining fifteen state defendants have once again moved for summary judgment, asserting that the record now before the Court conclusively demonstrates the lack of merit to plaintiffs' claims. Plaintiffs have filed papers in opposition to defendants' motion, and the Court heard oral argument on that motion on June 7, 2011.


Before analyzing the pending summary judgment motion which relates to all fifteen of the remaining defendants, it is prudent to review certain aspects of the Court of Appeals' 2006 Decision. The relevant factual background of the case was set forth with some precision in that decision, 436

F.3d at 149-51. The only claim of plaintiffs' to survive this Court's prior summary judgment decision and the Court of Appeals' decision is plaintiffs' First Amendment retaliation claim.

There are several aspects of the Second Circuit's decision relating to retaliation which bear repeating here. Of particular importance is, first, that court's holding that "issue preclusion does not bar litigation of the First Amendment retaliation claim." Id. at 153. In so ruling, the court rejected defendants' argument that the court should give preclusive effect to the decision of a state administrative law judge ("ALJ") who found, after an evidentiary hearing on DOH's claim that Beechwood's operating certificate should be revoked, that DOH had proved several serious deficiencies at Beechwood that justified revocation.

In his decision, the ALJ rejected Beechwood's allegations of improper motive on the part of DOH officials, finding that DOH acted in good faith and that it had attempted to keep Beechwood open, but that Beechwood and the Chamberys failed to take advantage of the opportunities afforded by DOH to rectify the problems with the facility. As the Second Circuit put it, "[t]he ALJ 'emphatically rejected Beechwood's allegations of regulatory 'bias or ill will.'" 436 F.3d at 151.

The Court of Appeals, however, held that these findings concerning DOH's motives are not entitled to preclusive effect in this case. The court explained that although the issue of improper motive was "actually decided" by the ALJ, it was not "necessarily decided," because the ALJ's decision on that issue was not "necessary to support a valid and final judgment on the merits' ... ." Id. (quoting Leather v. Eyck, 180 F.3d 420, 426 (2d Cir. 1999)). Therefore, the court concluded, "issue preclusion does not bar litigation of the First Amendment retaliation claim." Id.

The Court of Appeals went on to hold that "Beechwood [had] produced sufficient evidence of retaliatory motive to survive summary judgment." Id. The court cited evidence of "[s]uspect chronology--the close sequence of protest [by Chambery] and scrutiny" of Beechwood by DOH, which the court stated constituted circumstantial evidence of retaliatory motive, as well as "direct evidence ... that the State's hostile pursuit of the partnership was motivated by an intent to punish the partnership for exercising First Amendment rights of speech and petition ... ." Id. at 153, 154. Noting evidence of statements by some DOH officials to the effect that they "were going to get" Chambery for his previous lawsuits against DOH, as well as evidence concerning other statements expressing similar motives, the court concluded that "[t]his is evidence from which a jury could reasonably find that the DOH was campaigning against the partnership as retaliation for the exercise of First Amendment rights." Id. at 154.

As stated, having held that plaintiffs had presented sufficient evidence for a jury to find in their favor on the retaliation claim, the Court of Appeals remanded the action to this Court for further proceedings on that claim.

The Second Circuit's decision might seem, then, to have foreclosed any argument that plaintiffs' First Amendment claim should be dismissed as a matter of law, prior to trial. That is, however, precisely what defendants now seek to do.

Of course, this Court must comply with directives from the appellate court and must adhere to its mandate. Therefore, it indeed seems audacious, to say the least, for defendants to seek dismissal in favor of all the remaining defendants, in the face of the very clear Court of Appeals decision. That court found sufficient evidence to warrant a trial on the retaliation claim, and this Court must be ever mindful of that.

I do, however, recognize that a party is not generally precluded from making successive motions for summary judgment, as long as the party is not simply asking the court to rethink its earlier decision. See Sira v. Morton, 380 F.3d 57, 68 (2d Cir. 2004) ("district courts enjoy considerable discretion in entertaining successive dispositive motions") (citing Kovacevich v. Kent State Univ., 224 F.3d 806, 835 (6th Cir. 2000) ("District courts may in their discretion permit renewed or successive motions for summary judgment"); see also Campers' World Int'l, Inc. v. Perry Ellis Intern., Inc., 221 F.R.D. 409, 409 (S.D.N.Y. 2004) ("it is improper for a party to file a successive motion for summary judgment which is not based upon new facts and which seeks to raise arguments it could have raised in its original motion").

Defendants contend that their new motion for summary judgment is appropriate because it is based on evidence obtained through discovery following the Second Circuit's decision, as well as on new grounds. Defendants contend that "[e]xtensive discovery, including numerous depositions, have [sic] been conducted and before the Court is a new summary judgment [motion] on a complete record." Def. Mem. (Dkt. #187) at 3. Defendants also argue that whereas their prior motion, and this Court's and the Court of Appeals' previous decisions were based on the general legal principles of issue preclusion and absolute and qualified immunity, their present motion is based, in part, on the particular facts as to each individual defendant. It is also true, though, that defendants did not move previously on the primary ground raised here, i.e., that the evidence was lacking as to each individual defendant.

Although I am not convinced that some of the grounds now asserted in support of defendants' current motion could not have been presented previously, there has been a significant amount of discovery since the Second Circuit issued its decision in 2006. Whether the evidence unearthed in that discovery helps or hurts defendants is one of the points of contention here, but since defendants are not simply seeking to reargue matters that they raised, or could have raised, on their prior motion, I conclude that they are not precluded from again seeking summary judgment. See Seal v. Morgan, 229 F.3d 567, 580 (6th Cir. 2000) (noting that a district court has the discretion to entertain a successive or renewed summary judgment motion, and that doing so is particularly appropriate when the factual record upon which summary judgment is sought has been expanded) (citing Whitford v. Boglino, 63 F.3d 527, 530 (7th Cir. 1995)); accord Hoffman v. Tonnemacher, 593 F.3d 908, 911 (9th Cir. 2010). Of course, the pending motions must be viewed and decided consistent with the ruling from the Circuit as to the sufficiency of the evidence.

While the Second Circuit found plaintiffs' evidence sufficient to give rise to genuine issues of material fact as to plaintiffs' First Amendment claim, the court did not analyze the evidence as to each individual defendant, nor did the court intimate that its ruling was meant to apply across the board to all the defendants. The Court of Appeals determined, in summary fashion, that there was evidence that "the Department of Health" engaged in retaliatory conduct against plaintiffs. The Court of Appeals did cite some evidence and referenced certain defendants but did not do a defendant-by-defendant analysis. Because it is necessary for plaintiffs to establish each defendant's personal involvement in the alleged constitutional violation, the task falls to this Court to determine whether any genuine issues of material fact exist as to each defendant's involvement in the alleged retaliatory action. The Court of Appeals has spoken as to some of the evidence, and this Court has no basis to second-guess the Court of Appeals' findings relative to those matters. The parties have referenced many additional items of evidence which they claim bear on whether defendants should defend their conduct at trial.


Defendants devote several pages of their brief to arguing that plaintiffs cannot establish that defendants conspired to violate their rights. They also argue that any conspiracy claims here are subject to dismissal pursuant to the intracorporate conspiracy doctrine, under which "officers, agents and employees of a single corporate entity are legally incapable of conspiring together." Hartline v. Gallo, 546 F.3d 95, 99 n.3 (2d Cir. 2008) (internal quote omitted).

In response, plaintiffs disavow any reliance on a conspiracy claim or theory. They contend instead that each defendant was personally involved in what they describe as DOH's "offensive" against Beechwood, i.e., defendants' orchestrated campaign to put Beechwood out of business and to punish Chambery for his exercise of his First Amendment rights. Plaintiffs assert that defendants acted in concert, that defendants' actions caused plaintiffs to suffer one indivisible injury, and that all the defendants are therefore jointly and severally liable for plaintiffs' damages, but, they contend, such a claim does not require proof of the elements of a conspiracy.

Although the complaint does make some references to defendants having conspired together, see, e.g., Complaint ¶¶ 280, 285, 290, 295, conspiracy and indivisible injury are distinct concepts. See McKinnon v. City of Berwyn, 750 F.2d 1383, 1387 (7th Cir. 1984) (defendants "would be [jointly liable] either if they had conspired against [plaintiff] or if it just was not possible to say what portion of his injuries would have been avoided if a particular defendant had not participated in the wrongful conduct"); see also Sershen v. Cholish, No. 3:07-CV-1011, 2008 WL 598111, at *5 (M.D.Pa. Feb. 29, 2008) ("Although 'joint activity' and 'conspiracy' are often both present in the same case, the two tests for state action are ... distinct"); Ramos v. Town of Cicero, No. 04 C 2502, 2005 WL 1838334, at *3 (N.D.Ill. July 28, 2005) ("Plaintiffs respond that they are not alleging a conspiracy, and we do not believe that the allegation [that 'The defendants acted in concert with a common purpose and contributed to the same indivisible injuries sustained by plaintiffs'], read in its context ..., can fairly be read as an attempt to state a conspiracy claim").

Plaintiffs have not asserted a civil rights conspiracy claim under § 1985, and in any event the only claim left, following the remand from the Second Circuit, is a First Amendment retaliation claim under § 1983. While plaintiffs need not prove all the elements of a conspiracy, then, they will have to prove, as to each defendant, that the defendant was personally involved in the violation of plaintiffs' rights, and that each defendant contributed to plaintiffs' injury. See Back v. Hastings on Hudson Union Free Sch. Dist., 365 F.3d 107, 122 (2d Cir. 2004). Whether defendants should be held jointly and severally liable for that injury is an issue that can better be addressed at trial. See Thomas v. Cook County Sheriff's Dep't, 604 F.3d 293, 315 (7th Cir.) ("liability among defendants in a § 1983 case is joint and several--at least in the usual case of one plaintiff with a single indivisible injury") (emphasis omitted), cert. denied, ___ U.S. ___, 131 S.Ct. 643 (2010).


In their papers, defendants raise arguments concerning both qualified immunity, and, as to some defendants, absolute prosecutorial or quasi-judicial immunity. The Second Circuit stated that defendants had "mention[ed] an absolute immunity defense in passing," but the court added that such a "defense [wa]s considered waived since it only appear[ed] in a footnote." 436 F.3d at 154 n.3. As explained below, I find it unnecessary to consider an absolute-immunity defense as to any of the defendants.

With regard to qualified immunity, the Court of Appeals has also made clear, both in this case and elsewhere, that summary judgment on that ground is generally inappropriate with respect to First Amendment retaliation claims. If defendants acted with retaliatory intent, then no rational factfinder could conclude that they could have reasonably believed that their actions were lawful. See id. ("Where specific intent of a defendant is an element of plaintiff's claim under clearly established law, and plaintiff has adduced sufficient evidence of that intent to defeat summary judgment, summary judgment on qualified immunity grounds is inappropriate") (quoting Mandell v. County of Suffolk, 316 F.3d 368, 385 (2d Cir. 2003)). See also Johnson v. Ganim, 342 F.3d 105, 117 (2d Cir. 2003) ("Where a factual issue exists on the issue of motive or intent, a defendant's motion for summary judgment on the basis of qualified immunity must fail").*fn2


Despite the Second Circuit's seemingly unequivocal statement that "Beechwood produced sufficient evidence of retaliatory motive to survive summary judgment," defendants now contend that "the retaliation claim against each defendant should be dismissed." Def. Mem. (Dkt. #187) at 49 (emphasis added). The chief basis for that argument is defendants' assertion that "there is no evidence that any defendant personally retaliated against any plaintiff ... ." Id.

In other words, defendants contend that there is no evidence of sufficient personal involvement on the part of any particular defendant to hold that defendant liable for unconstitutional retaliation against plaintiffs. By their motions, defendants appear to take the startling position that in spite of the Court of Appeals' clear statement as to the sufficiency of proof, no defendant should proceed to trial. If accepted, that argument would leave plaintiffs in the curious position of having stated a retaliation claim against defendants generally, which the Second Circuit has held should go to a jury, yet being unable to establish liability against any individual defendant. That cannot be the case.

Plaintiffs must establish each defendants' personal involvement, and each defendant is entitled to argue, on the basis of the expanded record now before me, that there is insufficient evidence of his or her personal involvement in the alleged constitutional deprivation. Having reviewed that record, I find that defendants have carried their burden of showing that some, but not all, of them are entitled to summary judgment, as discussed below.

I have analyzed the evidence relating to retaliation as to each defendant. I have not, though, listed every piece of evidence and the permissible inferences from that evidence that could be considered by a jury as to any particular defendant. The Court of Appeals has already determined that issues of fact exist as to plaintiffs' First Amendment retaliation claim generally. It is not necessary, therefore, to go through the entire body of evidence before the Court. The only task left before me now is to decide whether enough evidence has been presented to give rise to issues of fact as to each individual defendant.

The Court of Appeals focused on some evidentiary items, e.g., the timing of certain actions and defendants' failure to follow normal procedures. The accumulation of all that proof--both direct and circumstantial--may be considered by the jury and may support a verdict if the jury concludes that the actions taken, and the circumstances under which they were taken, warrant the conclusion that a particular defendant acted with the particular retaliatory animus, or, knowing that others acted with such a state of mind, intentionally joined in the efforts to deprive plaintiffs of rights protected under the First Amendment.


In holding that there was sufficient evidence to create a triable issue of fact as to plaintiffs' retaliation claim, the Second Circuit specifically cited the evidence concerning defendant Sanford Rubin, who at all relevant times was DOH's Regional Director. The court cited a third-party affidavit indicating that DOH and Rubin "were going to get" Chambery for his previous lawsuits against DOH and Rubin, and stated that "[a] gloating e-mail from defendant Rubin to DOH personnel is fairly explicit: '[a]nother advantage on our side is that HCFA claims it will back us all the way ... they too have been harassed by Chambery. The chickens are coming home to roost.'" The Court of Appeals stated that "[t]his is evidence from which a jury could reasonably find that the DOH was campaigning against the partnership as retaliation for the exercise of First Amendment rights." 436 F.3d at 154.

That statement by the court could hardly have made any clearer that the Court of Appeals believed there to be sufficient evidence to proceed on plaintiffs' claims against Rubin. While defendants have attempted to explain away those statements by Rubin, arguing that they show only that Rubin believed that "Chambery was a weak nursing home leader," but that "Beechwood was strong in legal matters," Dkt. #226 at 28-29, such inferences are not for the Court to draw on a motion for summary judgment. A jury may find defendants' arguments persuasive, but I cannot say as a matter of law that defendants' proffered interpretation of Rubin's remarks is the only reasonable one, particularly after the Court of Appeals has plainly ruled otherwise. See Cioffi v. Averill Park Cent. Sch. Dist. Bd. of Educ., 444 F.3d 158, 162 (2d Cir.), cert. denied, 549 U.S. 953 (2006); Lundy v. Town of Brighton, 732 F.Supp.2d 263, 274 (W.D.N.Y. 2010). Frankly, after reviewing all the material presented on this motion, the evidence is most compelling against this particular defendant.


Until her resignation in September 2000, defendant Laura Leeds was Deputy Director of the Office of Continuing Care at DOH. In that capacity, she played a significant role in the decisions concerning Beechwood, including the revocation of its operating certificate. Leeds was in frequent contact with Rubin concerning Beechwood, and the evidence suggests that she was clearly in agreement with him that Beechwood should be shut down.

While there does not appear to be any direct evidence of retaliatory intent on Leeds's part, comparable to Rubin's statements about "chickens ... coming home to roost" and the like, there is nonetheless evidence that Leeds was determined to see Beechwood closed, or at least that Chambery be removed as its operator; regardless of the actual situation at Beechwood in the Spring of 1999. For instance, in an email to certain DOH employees dated May 13, 1999, Leeds stated that DOH was "removing immediate jeopardy," that is, that immediate patient concerns had been resolved. From the removal of that "immediate jeopardy" classification, it would seem that Beechwood was more in compliance with DOH's requirements but, in spite of this now more favorable status, Leeds pressed ahead in the email to remove Chambery. She stated: "We will continue to see if we can make the case for caretaker [i.e., to take Chambery's place] next week." In parentheses, she added to one of the recipients of the email, "John this is the only piece we do not want [made] public." Pl. Ex. 76.*fn3

Those statements are, of course, subject to varying interpretations. Leeds may have simply meant that DOH would continue to monitor the situation, and that they would revisit the issue of whether Chambery should be allowed to continue to operate Beechwood the following week. It is not within the province of the Court, though, to draw such inferences on a motion for summary judgment. Cioffi, 444 F.3d at 162. Likewise, Leeds's parenthetical statement that DOH did not want her statement about the caretaker to be made public may have simply reflected a desire to avoid fueling public speculation or uncertainty about whether Beechwood was going to be shut down, but it might also indicate that Leeds was trying to create the impression that DOH was working with Beechwood to resolve the problems there so that it could remain in operation, while secretly she and others at DOH continued to pursue the goal of ousting Chambery and eventually shutting Beechwood down.

Plaintiffs have also submitted an affidavit of Paul Kesselring, who formerly was employed at Beechwood as an assistant administrator. He states that in September 1999, he attended a seminar concerning health care issues, at which Leeds spoke. According to Kesselring, at one point Leeds, referring to Beechwood, stated that DOH "had to close a facility this year. The staff at that facility were excellent. It was a horrible situation that I hope to never go through again. We had to close that facility for all the wrong reasons." Pl. Ex. 395 ¶ 5. Kesselring states that during a break that followed, he observed Leeds engaged in a "very animated conversation" with defendant Anna Colello from DOH's Bureau of Surveillance and Quality Assurance. After the seminar resumed, Leeds returned to the subject of Beechwood, backtracking a bit by saying that "[w]hen [DOH] closed Beechwood all the staff weren't really terrific. There were a lot of very serious care concerns and problems that were legitimate. The administration refused to cooperate." Id. ¶ 7.

In its 2006 decision in this case, the Second Circuit specifically cited Leeds's alleged "all the wrong reasons" statement as among the "evidence from which a jury could reasonably find that the DOH was campaigning against the partnership as retaliation for the exercise of First Amendment rights." 436 F.3d at 154.

Again, more than one inference could be drawn from this evidence. In particular, Leeds's alleged statement about closing Beechwood "for all the wrong reasons" is somewhat cryptic. While it would be surprising if Leeds had meant that as a public acknowledgment that DOH had closed Beechwood for unlawful reasons, that statement, coupled with Leeds's later alleged statement in which she seemed to back off from her earlier comment about the employees at Beechwood being "excellent" is evidence that a jury could consider in determining whether she acted with retaliatory intent. In short, there are issues of fact as to Leeds's personal involvement in the alleged retaliation.


Defendant Antonia Novello was Commissioner of DOH from June 15, 1999 to January 1, 2007. She signed the order revoking Beechwood's ...

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