Crime & Federalism

If a private employer fires an at-will employee at the behest of a government official, is the employer liable under 1983?  Pending before the Eighth Circuit Court of Appeals is a fascinating case raisings that question.  Betty Lou Dossett vs. First State Bank (No. 03-2624).

Betty Dossett worked for a bank in Nebraska.  After she spoke out at a school board meeting, the president of the school board complained to her boss.  He told Dossett's boss that if she wasn't fired, then he would pull the school's account from the bank.  The bank manager complied and fired Dossett.

Since Dossett was an at-will employee, she did not have a traditional lawsuit against the bank.  But plaintiffs' attorney Maren Lynn Chaloupka creatively thought to sue the bank under section 1983.  Although a 1983 action requires acts done under color of state law, a private party who conspires with a state actor to deprive someone of her rights is, for purposes of 1983, a state actor. 

Since the bank agreed with a state actor to fire a Dossett for protected speech, the bank became a state actor.  A jury agreed and awarded Dossett $1.56 million.  [The cases gets really interesting here, but prudence cautions me to stick to the legal issues.  All I'll say is that the trial transcript indicates that the trial judge, on his own motion, kills the verdict and orders a re-trial.  He does not offer the plaintiff a remittur.  Then he re-writes the jury instruction, even though he relied upon the Eighth Circuit's Model Jury Instructions during the first trial.]

Anyhow, the case has been perfected.  Dossett's appellate brief is here, her reply brief is here, and bank's brief is here.

The policy issue raised in Dossett is also fascinating.  Should a private employer face liablity for doing nothing other than please his (government) customer?  There's a strong policy that employers can fire employees for any reason, or no reason.  And one of the beauties of the Constitution is that is does not encumber private decisions with constitutional procedures.  It's a good thing that you are not required to give notice and an opportunity to be heard to someone you decide to summarily delete you from your friends list.

On the other hand, few of us would have a problem with holding liable under 1983 a private actor who helps a police officer brutalize a citizen.  Why then should we tolerate a bank's helping a school board official violate the First Amendment rights of a citizen?

Full disclosure: I offered research and writing support for the appellant's brief, although Ms. Chaloupka did the lion's share of the work.  (I only helped with the joint action theory of the brief).

UPDATE: Victory!