Sharon Hammer v. City of Sun Valley
700 F. App'x 659
| 9th Cir. | 2017Background
- Sharon Hammer was terminated and received a severance payment after executing a supplemental release drafted by Hammer and her attorney-husband James Donoval and provided to the City of Sun Valley.
- Hammer sued, raising multiple claims including unconstitutional bias, a liberty-interest "stigma-plus" due-process claim, claims against individual defendants (Nils Ribi and DeWayne Briscoe), and a claim by Donoval.
- The district court granted a Rule 12(c) judgment on the pleadings, dismissing most claims on the ground that the supplemental release unambiguously waived claims for termination without cause; it also granted summary judgment on the stigma-plus claim and denied leave to amend.
- Hammer appealed; the Ninth Circuit reviewed whether the supplemental release was unambiguous (a question of law), whether the court abused discretion denying conversion to summary judgment or denying leave to amend, and whether certain dismissals were supported by clear reasoning.
- The Ninth Circuit affirmed the 12(c) dismissal as to claims waived by the supplemental release, affirmed denial of conversion and denial of leave to amend as not an abuse of discretion, reversed and remanded the stigma-plus liberty interest claim and several other dismissals (including claims against Ribi and Briscoe in their individual capacities and Donoval’s claim), and vacated the award of costs against Hammer and Donoval.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Enforceability of supplemental release / waiver | Hammer argued the release did not bar her claims or was ambiguous. | City argued the release was clear and unambiguously waived "any and all claims" for termination without cause. | Release unambiguous under Idaho law; 12(c) dismissal of waived claims affirmed. |
| Motion to convert 12(c) to summary judgment | Hammer sought conversion to consider extrinsic evidence and disputed facts. | City argued contract interpretation was a legal question appropriate on 12(c) when terms unambiguous. | Denial of conversion not an abuse of discretion; affirmed. |
| Liberty-interest (stigma-plus) due-process claim standard and falsity | Hammer argued district court misapplied doctrine; factual disputes remained about what was published and its falsity. | City treated statements as substantially false and supported summary judgment. | District court conflated Gebbie and Campanelli tests and improperly granted summary judgment; reversal and remand. |
| Dismissal of claims against individual defendants and Donoval’s claim | Hammer/Donoval contended these dismissals lacked clear grounds or were erroneous. | Appellees relied on release and district-court rulings. | Reversed where district court’s reasoning was unclear; remanded for clarification. |
| Denial of leave to amend and award of costs | Hammer argued amendment should be permitted; costs inappropriate given appeal issues. | District court found amendment futile; costs awarded after judgment. | Denial of leave to amend affirmed as not futile to deny; award of costs vacated and costs entry reversed. |
Key Cases Cited
- City of Idaho Falls v. Home Indem. Co., 126 Idaho 604, 888 P.2d 383 (Idaho 1995) (contract interpretation governed by plain meaning when unambiguous)
- Wylie v. State, Idaho Transp. Bd., 151 Idaho 26, 253 P.3d 700 (Idaho 2011) (unambiguous contract terms present questions of law appropriate for judgment on the pleadings)
- Brady v. Gebbie, 859 F.2d 1543 (9th Cir. 1988) (stigma-plus liberty-interest test)
- Campanelli v. Bockrath, 100 F.3d 1476 (9th Cir. 1996) (stigma-plus test requiring falsity of statements)
- Sylvia Landfield Tr. v. City of Los Angeles, 729 F.3d 1189 (9th Cir. 2013) (denial of leave to amend not an abuse where amendment would be futile)
- Allwaste, Inc. v. Hecht, 65 F.3d 1523 (9th Cir. 1995) (futility is a valid basis to deny leave to amend)
- Corder v. Gates, 947 F.2d 374 (9th Cir. 1991) (standard for abuse of discretion in awarding costs)