Friday, February 19, 2010
Court Revives Former DWP Vendor’s Suit Against Agency
By SHERRI M. OKAMOTO, Staff Writer
The Ninth U.S. Circuit Court of Appeals yesterday revived a Northridge businessman’s claim that the Los Angeles Department of Water and Power had violated his First Amendment rights by engaging in adverse action against him because of his public criticism of the agency’s procurement procedures.
U.S. District Judge Florence-Marie Cooper of the Central District of California, since deceased, had granted summary judgment in favor of the government defendants, but the appellate panel ruled Candido Marez’s position on a municipal advisory committee did not preclude him from asserting a constitutional violation and that he had raised triable issues of material fact as to whether he was the target of adverse actions by the DWP.
Marez was the owner of Montrose Supply Co., which was a vendor of various products to the DWP from the late 1980s until 2007, and a member of the Los Angeles City Council’s Small and Local Business Advisory Committee, which was created in 2004 as part of then-Mayor James Hahn’s efforts to reform the city’s contracting process and related services for small businesses.
As co-chair of the committee’s Mega-Contracts Subcommittee, Marez began receiving a number of complaints from small business owners about a DWP contract for janitorial services awarded to Empire Janitorial Cleaning Supplies.
After he investigated these allegations and presented his findings to the City Council in March 2004, he said he received threatening phone calls and introduced evidence that they had been made from a DWP phone line.
The DWP revised its procurement process in April 2004, and Marez asserted that the changes were made so that his company would have a harder time securing contracts and suffered a major decrease in revenue as a result.
Marez also alleged that DWP employees failed to inform him about opportunities to submit bids and deliberately provided him false information regarding contract specifications to thwart his ability to submit a successful bid.
In June 2004, he met with DWP employees to complain about the difficulties he was having obtaining contracts; that July, Marez again appeared before the City Council claiming that the DWP had retaliated against him for speaking out against the Empire contract.
One month later, Marez filed a formal grievance with the DWP alleging that certain tents sold to the agency by CalOlympic Safety did not comply with the specified fire safety standards in the agency’s bid request.
He also reported this information to the City Council, which then investigated the matter. A DWP official assured the council members that the tents met the required fire safety standard, but a subsequent inspection revealed that the tents did not.
The DWP then rescinded its contract with Cal Olympic and opted to buy the tents from Marez’s company, which had offered the lowest price during the original bidding period.
Marez filed suit against the DWP and various employees in Jan. 2006 but Cooper granted summary judgment for the defendants, finding that Marez had offered “no evidence” that he had suffered any adverse action.
Senior U.S. District Judge Louis H. Pollak of the Eastern District of Pennsylvania disagreed in his decision for the appellate panel, on which he was sitting by designation.
In order for Marez to prevail on his claims, Pollak explained that Marez had to prove he had engaged in expressive conduct that addressed a matter of public concern which was a substantial or motivating factor behind the defendants’ allegedly adverse actions against him.
Pollak posited that there could be “no serious dispute that plaintiff engaged in conduct that addressed a matter of public concern,” since “[c]laims of government corruption, maladministration, or misuse of funds fall squarely within the First Amendment.”
The defendants contended that Marez had spoken as a member of the Small and Local Business Advisory Committee, not as a private citizen, and therefore could not assert a constitutional violation pursuant to Garcetti v. Ceballos, (2006) 547 U.S. 410, which held that a government employee can be disciplined for a public statement made as part of his official duties.
But Pollak explained that Garcettii would only apply if Marez’s committee position was tantamount to city employment, and concluded that it was not.
“Marez’s Committee position did not entail the usual hallmarks of employment,” the jurist said, noting the absence of any evidence in the record that Marez was paid or wielded any official power.
Accordingly, “Garcetti does not sweep statements he made in that capacity outside the protection of the First Amendment,” Pollak said.
Pollak added that the proffered evidence provided support for Marez’s allegations that at least some of the DWP’s actions were retaliatory and emphasized that the scope and consequences of the DWP’s actions did not need to be severe to qualify as an adverse action.
Judges William A. Fletcher and Richard R. Clifton joined Polllak in the decision vacating the grant of summary judgment and remanding for further proceedings.
The attorneys on the case—Marez v. Bassett, 08-56035—were Patricia J. Barry, who represented Marez, DWP General Counsel Richard M. Brown, and Deputy City Attorney Lisa S. Berger.
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