DeMartino v. NYS Dep't of Labor
16-978-cv
| 2d Cir. | Oct 5, 2017Background
- Plaintiffs TADCO Construction Corp. and Frank DeMartino sued New York State Department of Labor (DOL), Dormitory Authority of the State of New York (DASNY), and individual employees seeking damages and injunctive relief for withheld contract payments and investigatory actions.
- Disputes arose from a 2007 records-based withholding on a Queens Hospital project and 2010/2013 withholdings (direct and cross-withholding) for alleged prevailing-wage violations on a Staten Island project.
- TADCO alleged violations of procedural and substantive due process, abuse of process, a § 1983 conspiracy, and sought hearings and injunctive relief.
- The district court dismissed TADCO’s claims; TADCO appealed. While the appeal was pending, DOL concluded its administrative proceeding finding prevailing-wage violations.
- The Second Circuit affirmed in part and dismissed in part: it rejected procedural and substantive due process claims, declined to recognize an abuse-of-civil-process § 1983 claim, dismissed injunctive relief as moot, and upheld denial of recusal.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| 1) 2007 records withholding — procedural due process | TADCO: withholding of payment without prompt post-deprivation hearing violated procedural due process | DOL/DASNY: procedure for records withholding satisfies due process; TADCO failed to maintain/produce required records | Court: No violation — withholding procedure adequate and no factual dispute made a hearing meaningless |
| 2) 2010/2013 prevailing-wage withholdings — delay in hearing | TADCO: four-year delay in administrative hearing deprived it of due process | Defs: No constitutional right to immediate administrative hearing; contract and statutory remedies suffice | Court: No violation — availability of contract/mandamus/Article 78 remedies satisfies due process (Lujan principle) |
| 3) Substantive due process based on investigation | TADCO: DOL’s investigatory actions violated substantive due process | Defs: Investigation was lawful and required; did not shock the conscience | Court: Dismissed — conduct did not meet high "shock the conscience" standard; TADCO had legal duty to maintain/produce payroll records |
| 4) Abuse of process and § 1983 conspiracy | TADCO: defendants abused process and conspired to deny rights | Defs: § 1983 recognizes only abuse of criminal process; underlying federal claims fail | Court: § 1983 abuse-of-process claim fails (limited to criminal process); conspiracy claim dismissed because underlying claims fail; state-law abuse argument not preserved for appeal |
| 5) Injunctive relief & recusal | TADCO: sought injunctions and asserted district judge should recuse | Defs: Administrative proceeding resolved merits; judge impartial | Court: Injunctive claims moot after administrative conclusion; recusal denial affirmed — no reasonable observer would question impartiality |
Key Cases Cited
- Lujan v. G & G Fire Sprinklers, Inc., 532 U.S. 189 (availability of contract suit satisfies due process for withholding)
- Oneida Indian Nation of New York v. Madison Cty., 665 F.3d 408 (due process principles regarding administrative remedies)
- County of Sacramento v. Lewis, 523 U.S. 833 (substantive due process "shock the conscience" standard)
- Lombardi v. Whitman, 485 F.3d 73 (investigatory conduct not necessarily conscience-shocking)
- Green v. Mattingly, 585 F.3d 97 (§ 1983 abuse-of-process limited to criminal process)
- Mhany Mgmt., Inc. v. Cty. of Nassau, 819 F.3d 581 (issue-preservation for appeal)
- Droz v. McCadden, 580 F.3d 106 (conspiracy under § 1983 depends on underlying constitutional violation)
- SEC v. Razmilovic, 738 F.3d 14 (recusal standard — objective observer test)