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Patterson v. Lawhorn

United States District Court, E.D. Virginia, Alexandria Division

July 20, 2016

LESLIE PATTERSON, Plaintiff,
v.
DENISE LAWHORN, Defendant.

          MEMORANDUM OPINION

          LEONIE M. BRIAKEMA UNITED STATES DISTRICT JUDGE

         Before the Court is Denise Lawhorn's ("defendant" or "Lawhorn") Motion for Summary Judgment [Dkt. No. 82], Dec. 14, 2015. Plaintiff Leslie Patterson ("plaintiff' or "Patterson"), the African-American pastor of the First Baptist Church of Sterling ("FBCS" or the "church") initially filed this civil action on October 23, 2014 prose in the Prince William Circuit Court against two agents of the Virginia Department of Taxation, Lawhorn and John Hawse ("Hawse"), in their individual capacities based on allegations that they had violated his Fourth Amendment "right not [to] be arrested or subjected to criminal prosecution without probable cause" and the Virginia malicious prosecution statute. Second Am. Compl. ¶ 52 [Dkt. No. 30], Jun. 8, 2015.

         On April 10, 2015, Lawhorn and Hawse filed a Joint Notice of Removal [Dkt. No. 1], which resulted in plaintiffs Complaint being removed to this court, and on April 17, 2015 they filed a motion to dismiss. See Defs.' Joint Mot. to Dismiss [Dkt. No. 3], Apr. 17, 2014. On May 8, 2015, Patterson retained counsel, see Notice of Appearance [Dkt. No. 12], and on June 5, 2015, he filed his first Amended Complaint [Dkt. No. 20]. Defendants filed a revised motion to dismiss on June 19, 2015, see Defs.' Mot. to Dismiss [Dkt. No. 21], Jun. 19, 2016, which the Court granted in part on June 30, 2015, dismissing all claims against Hawse. Order [Dkt. No. 26], Jun.30, 2015.

         Patterson filed a Second Amended Complaint [Dkt. No. 30] on July 9, 2015, consisting of thirteen counts alleging violations of the Virginia malicious prosecution statute and thirteen counts alleging violations of 42 U.S.C. § 1983 against Lawhorn alone. Specifically, plaintiff alleges that the six felony warrants and seven misdemeanor warrants for which Lawhorn was the complainant, all of which resulted in his arrest, were not based on probable cause and that Lawhorn is liable to him for violating his Fourth Amendment right to be free of unlawful seizure and his right under Virginia law not to be subject to malicious prosecution. In particular, Patterson alleges that both the felony and misdemeanor complaints supporting the warrants at issue contain bare recitations of the elements of each statute and do not contain any written factual support for their legal conclusions. Plaintiff seeks compensatory and punitive damages as well as attorneys' fees and costs. Second Am. Compl. 21-22.

         In her motion for summary judgment, Lawhorn argues that plaintiffs § 1983 claims are barred by Eleventh Amendment Sovereign Immunity and that she is entitled to qualified immunity as to the claims under § 1983. In addition, Lawhorn argues that there is insufficient evidence in this record to support any of plaintiff s claims. For the reasons discussed below, defendant's motion for summary judgment will be granted.

         I. FACTUAL BACKGROUND

         The investigation into plaintiffs tax and financial activities was started by the Virginia Department of Taxation after it received a referral from the Loudoun County Sheriffs Department and the United States Secret Service. Def.'s Mem. in Supp of Mot. for Summ. J. 3 [Dkt. No. 83], Dec. 14, 2015 ("Def.'s Mem."); Def.'s, Notice of Sub. of Exs. For Mem. in Supp. of Mot. for Summ. J., Ex. 1, at 2; Ex. 3, ¶ 6 [Dkt. No. 84], Dec. 14, 2015 [hereinafter "Def.'s Ex."].[1] These agencies had been alerted to Patterson's suspicious financial and tax activities by former members of his church. Def.'s Mot. to Strike and Rebuttal Br. in Supp. of Mot. for Summ. J. 2 [Dkt. No. 92], Jan. 19, 2016 ("Def.'s Rebuttal"); Pl's Mem. in Opp'n to Def.'s Mot. for Summ. J. 1 [Dkt. No. 90], Jan. 12, 2016 ("Pl's Opp'n"). Lawhorn was one of the Virginia Department of Taxation's criminal investigators assigned to investigate the allegations about Patterson's activities. Def.'s Ex. 3 (McGarvey DecL), ¶¶ 5, 8. In her role as a criminal investigator, Lawhorn was authorized to perform independent investigations of suspected violations of the Commonwealth's tax laws and related offenses. Def.'s Ex. 2, at 1. Once she completed an investigation, she was required to present her findings and conclusions to supervisors within her department for their review; then, if they approved filing criminal charges, to obtain further review and approval from the appropriate prosecutorial entities. Pl's Opp'n, Ex. C (Lawhorn Dep.), at 111:12-15 [hereinafter "Pl's Ex."]. Because Lawhorn was not a law enforcement officer, she could not apply for felony warrants without a prosecutor's approval. Def.'s Ex. 2, at 1; Va. Code Ann. § 9.1-101 (2014). Although Lawhorn was not legally required to obtain a prosecutor's signature in advance of applying for misdemeanor warrants, the record shows that before obtaining the misdemeanor warrants at issue she first obtained her supervisor's approval of her findings and then discussed the misdemeanor charges with a prosecutor. Pl's Ex. G (Arledge Dep.), Exs. 8, 9. Lawhorn understood that she received the prosecutor's approval to apply for the misdemeanor warrants. Def.'s Ex. 44 (Lawhorn Dep.), at 111:4-15.

         A. Felony Charges

         It is undisputed that when Patterson filed his individual federal and Virginia income tax returns for 2007, 2008, 2009, and 2010, the returns misrepresented his income. As discussed in Lawhorn's prosecution report and confirmed when Patterson filed amended returns several months after being arrested on the felony charges, he inaccurately reported his income for all four years. Def.'s Exs. 1, 11. Patterson's returns also took credit for deposits of employee withholding taxes that in fact had not been deposited with the Commonwealth. Def.'s Exs. 12, 13, 14, 15, 16, 17.

         As part of her investigation, Lawhorn assembled numerous financial records and summarized her findings in a prosecution package in which she recommended that Patterson be prosecuted for violations of Va. Code Ann. §§ 58.1-348 and 18.2-178 for the 2007, 2008, 2009, and 2010 tax years.[2] Def.'s Ex. 1. According to the declaration of Lawhorn's supervisor, Rhonda McGarvey, she reviewed Lawhorn's completed report, approved the recommendation to file felony charges against Patterson, and directed Lawhorn to contact the Office of the Commonwealth's Attorney to obtain final approval. McGarvey Decl. ¶ 11.

         Following McGarvey's directions, Lawhorn contacted Assistant Commonwealth's Attorney John Arledge ("Arledge"), and, according to Arledge's rough daily logs, met with him for at least twelve minutes on October 25, 2011. Def.'s Ex. 19 (Arledge Dep.), 25:2-4; 65:23-66:3. At the conclusion of the meeting, Arledge signed the six criminal complaints, each of which included a statement that he had given "[authorization prior to issuance of [the] felony arrest warrant." Second Am. Compl., Exs. 1-6, at 4. By signing the complaints, Arledge authorized Lawhorn to swear out two criminal complaints for Patterson's alleged violations of Va. Code Ann. § 18.2-178 for the tax years of 2007 and 2008 and four criminal complaints for Patterson's alleged violations of Va. Code Ann. § 58.1-348 for the tax years of 2007 through 2010. Id. Lawhorn then appeared before state magistrate Gary L. Talbot on October 25, 2011, and signed each of the criminal complaints "[u]nder penalty of perjury ... [and] sw[o]re or affirm[ed] that [Lawhorn] ha[d] reason to believe that the Accused committed a criminal offense[, ]" and that "[t]he statements [made therein] [were] true and accurate to the best of [her] knowledge and belief." Id. Although none of the complaints included a specific description of the facts supporting probable cause, in her supplemental declaration in this litigation, Lawhorn explained that she presented her felony prosecution package and supporting evidence to magistrate Talbot and answered his questions under oath. Def.'s Rebuttal Ex. R5 (Lawhorn Decl.), ¶ 11.[3] Magistrate Talbot issued the six felony arrest warrants, Second Am Compl., Exs.1-6, and Officer J.T. Callahan executed the warrants and arrested Patterson on October 27, 2011. Id.

         Defendant contends and plaintiff disputes that the charges were ultimately nolle prossed as a result of a settlement agreement. Although the record shows that plaintiffs counsel and Assistant Commonwealth's Attorneys communicated during the ten months following Patterson's arrest, the content of those communications is not in the record; however, what is in the record is Arledge's sworn testimony, in which he alludes to reaching an informal agreement with Patterson that the felony charges would be dismissed if Patterson filed amended tax returns and paid any back taxes. Def.'s Rebuttal, Ex. R7 (Arledge Dep.), at 86:22-25 ("I know we made plea offers that had been rejected. I thought there was something at some point if they'll of [sic] file filings or pay the taxes, that the charges will be dismissed."). On May 21 and 24, 2012, plaintiff filed amended tax returns for 2007 through 2010, and on June 19, 2012, the Commonwealth's Attorney nolle prossed all of the pending felony charges. Def.'s Ex. 22. The sequence of these events is consistent with defendant's assertion that the felony charges were resolved pursuant to a compromise. Arledge Dep. 56:2-6. Moreover, in a June 22, 2012 email to Arledge, Patterson's attorney described the history of the relevant felony charges by stating that they were nolle prossed "when we agreed that while he made mistakes on his tax returns, he did not take any money." Def.'s Rebuttal, Ex. R8.[4]

         B. Misdemeanor Charges

         It is undisputed that although plaintiffs church employed staff throughout all quarters of 2008, 2009, and 2010, the church neither filed Virginia's quarterly withholding forms (VA-5 Forms) for its employees on or before the quarterly due dates during those years, nor did it timely deposit any payments of those employees' withholding taxes. Def.'s Exs. 23-37. It is further undisputed that Patterson was the only person authorized to deposit any withheld funds.[5]Def.'s Exs. 4, 5.

         It was not until September 20, 2011, after the Department of Taxation's investigation had begun, Def.'s Ex. 1, at 21, that Patterson presented the overdue VA-5 Forms for tax years 2008 through 2010 to the Department of Taxation by giving them to Lawhorn and Hawse during an interview-no deposits of withheld funds accompanied these forms. Def.'s Ex. 39. Along with the forms was a letter plaintiff signed in which he acknowledged being responsible for the church's withholding taxes. Lawhorn Dep. 72:5-11; 80:23-81:10; 82:18-83:1. Yet, it was not until March 7, 2012, over five months after filing the late returns when Patterson started depositing the overdue taxes.[6] Pl's Ex. G (Arledge Dep.), Exs. 8, 9. According to Lawhorn's prosecution report, the amounts paid only covered the principal due and did not include any payment of the outstanding penalties and interest due for each delinquent quarter. Def.'s Ex. 41, at 4. Lawhorn's report is supported by the checks signed by Patterson, each of which show in their legends that each payment was a "principal payment." Pl's Ex. E. Moreover, interest and penalties aside, there is a discrepancy in the record about whether there were still outstanding principal balances owing as of June 2012. See Def.'s Rebuttal, Ex. R15 (Notice of Delinquency issued by the Department of Taxation on October 10, 2012 showing a total balance owing of $957.82 for withholding taxes in 2009, including $607 of principal); compare Pl's Ex. G, Ex. 9 (containing a chart suggesting that all balances for 2009 and 2010 were paid as of June 14, 2012), with Def.'s Ex. 41, at 5 (containing a chart updated on August 27, 2012 suggesting that a $607 balance remained owing for 2009 and 2010).

         Around June 14, 2012, Lawhorn met with Arledge, who asked her about the status of the delinquent withholding taxes. Lawhorn Dep. 28:1-19; 49:16-23. After Lawhorn explained that there was still a balance outstanding, Arledge directed her to compile a prosecution package to support charges against Patterson for FBCS' failure to account for and pay withholding taxes. Id. Lawhorn assembled a prosecution package setting forth the findings of her investigation and obtained her supervisor's approval to seek prosecution of Patterson. Lawhorn Decl. ¶¶ 7, 8. Lawhorn then went to Arledge to discuss whether misdemeanor or felony charges should be filed against Patterson for failing to timely file and pay withholding taxes. Def.'s Rebuttal, Ex. R13 (email from Lawhorn to Arledge referring to earlier conversations about FBCS' delinquent withholding taxes and inquiring about whether to bring misdemeanor or felony charges against Patterson). Pursuant to Department of Taxation policy, Arledge possessed the ultimate authority to determine whether criminal charges should be filed and the nature of those charges. Lawhorn Dep. 111:12-15. After reviewing Lawhorn's prosecution package, Arledge directed her to swear out misdemeanor complaints for any quarters for the years 2009 and 2010 for which withholding balances were due.[7] Def.'s Rebuttal, Ex. R5 (Lawhorn Decl.), ¶ 15; Arledge Dep. 25:2-13; Pl's Ex. C (Lawhorn Dep.), at 38:10-24; 189:22-190:7; Def.'s Rebuttal, Ex. R9 (Lawhorn Dep.), at 179:5-10.

         On June 27, 2012, Lawhorn appeared before magistrate Gary R. Wheelehan to swear out seven misdemeanor complaints, one for each of the quarters at issue, specifically the second through fourth quarters of 2009 and all four quarters of 2010. Def.'s Ex. 44 (Lawhorn Dep.), at 111:16-21. As she did with the felony complaints, Lawhorn signed each of the misdemeanor complaints "[u]nder penalty of perjury ... [and] sw[o]re or affirm[ed] that [she] ha[d] reason to believe that the Accused committed a criminal offense[, ]" and that "[t]he statements [made therein] [were] true and accurate to the best of [her] knowledge and belief." Second Am. Compl., Exs. 7-13, at 3. In her deposition, Lawhorn explained that she presented her prosecution package, which included the report and relevant evidence, to the magistrate in support of the criminal complaints. Lawhorn Dep. 109:19-110:23. There is no evidence in the record that contradicts that statement.

         The misdemeanor warrants were not issued in compliance with an amendment to the Rules of the Supreme Court of Virginia issued on December 22, 2011, and made effective as of March 1, 2012. That amendment requires that all sworn statements of facts supporting probable cause made by non-law enforcement officers (such as Lawhorn) be reduced to writing. Va. Sup. Ct. R. 3A:3. Although there are no written attachments to the misdemeanor complaints, magistrate Wheelehan signed all of them. Second Am. Compl., Exs. 7-13, at 2. There is no evidence in the record that Lawhorn was aware of the amendment.

         Because Lawhorn was not a law enforcement officer, she did not have the authority to arrest Patterson. As a result, the warrants were given to Prince William County Police Officer A.P. Javid, who had the discretion to either arrest Patterson or to permit him to appear by summons. Id. (stating that execution by summons is permitted at officer's discretion). Javid made the decision to arrest Patterson, rather than to summon him to appear. Id.; Def.'s Mem. 2. There is no evidence in the record indicating that Lawhorn influenced Javid's decision. In the fall of 2012, Arledge's successor met with Lawhorn, who provided him with an update reflecting Patterson's recent payments toward FBCS' withholding arrearages. Upon learning that Patterson was making good on this debt, Arledge's successor voiced his intention to nolle pross the misdemeanor charges and leave the Department of Taxation to pursue the civil penalties due on the remaining balance. Lawhorn Dep. 54:12-24. On October 24, 2012, all of the misdemeanor charges were nolle prossed, Def.'s Mem. 2.

         II. DISCUSSION

         Lawhorn focuses much of her Motion for Summary Judgment on the Eleventh Amendment, arguing that it bars plaintiffs action for damages under § 1983. Def.'s Mem. 13. In addition, Lawhorn contends that the evidence is insufficient to support either the § 1983 or state malicious prosecution claims, and finally, that qualified immunity shields her from § 1983 liability because her actions did not violate Patterson's clearly established constitutional rights. Id. at 15, 21, 25.

         A. Standard of Review

         Summary judgment is merited where the record demonstrates that "there is no genuine dispute as to any material fact and that the moving party is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). Although the court must "resolve all factual disputes and any competing, rational inferences in the light most favorable to the party opposing that motion, " Id. (quoting Wightman v. Springfield Terminal R v. Co., 100 F.3d 228, 230 (1st Cir. 1996) (internal quotation marks omitted)), all inferences drawn in the nonmovant's favor must "fall within the range of reasonable probability and not be so tenuous as to amount to speculation or conjecture." Thompson Everett. Inc. v. Nat'l Cable Adver., L.P., 57 F.3d 1317, 1323 (4th Cir. 1995).

         Furthermore, "[t]he mere existence of a scintilla of evidence in support of the [opposing party's] position will be insufficient" to defeat summary judgment. Anderson v. Liberty Lobby. Inc., 477 U.S. 242, 252 (1986); see also Am. Arms Int'l v. Herbert, 563 F.3d 78, 82 (4th Cir. 2009). Rather, a genuine issue of material fact exists only "if the evidence is such that a reasonable jury could return a verdict for the nonmoving party, " Anderson, 477 U.S. at 248, and any existing factual dispute must be both "material" and "genuine, " such that it has the potential to "affect the outcome of the suit under the governing law." Hooven-Lewis v. Caldera, 249 F.3d 259, 265 (4th Cir. 2001).

         B. Eleventh Amendment Sovereign Immunity

         Relying on the factors set down in Martin v. Wood, 772 F.3d 192, 195 (4th Cir. 2014), Lawhorn asserts that the Eleventh Amendment bars this action for damages because even though the complaint is pleaded against her in her individual capacity, it is effectively brought against the Commonwealth. Def.'s Mem. 13. In response, Patterson argues that the Court already rejected the Eleventh Amendment argument, which Lawhorn made in her Motion to Dismiss [Dkt. No. 27], and that Lawhorn's contentions do not merit reconsideration under Fed.R.Civ.P. 59(e). Pl's Opp'n 15. The Court finds that Eleventh Amendment sovereign immunity does not shield Lawhorn because the Martin factors are inapplicable to § 1983 claims.

         The Eleventh Amendment provides that "[t]he judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by citizens of another state, or by citizens or subjects of any foreign state." U.S. Const, amend. XI. "The Eleventh Amendment grants a State immunity from suit in federal court... by its own citizens as well." Lapides v. Bd. of Regents of Univ. Sys. of Ga., 535 U.S. 613, 616 (2002) (citing Hans v. Louisiana, 134 U.S. 1 (1890)). More specifically, the Eleventh Amendment has been construed to bar damages actions in federal court against a State or its officials in their official capacity, "absent waiver by the State or valid congressional override." Kentucky v. Graham, 473 U.S. 159, 169 (1985) (footnote and citation omitted).

         Nevertheless, "the Eleventh Amendment does not erect a barrier against suits to impose 'individual and personal liability' on state officials under § 1983." Hafer v. Melo,502 U.S. 21, 30-31 (1991). In other words, "the Eleventh Amendment provides no shield for a state official confronted by a claim that he had deprived another of a federal right under the color of state law, " id at 30 (quoting Scheuer v. Rhodes,416 U.S. 232, 237 (1974)), "nor are state officers absolutely immune from ...


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