292 F.R.D. 689
M.D. Ala.2013Background
- Janie Weeks was executive director of the City of Opp Housing Authority (OHA) until mid-2011; OHA’s funds and expenditures are subject to HUD approval under an Annual Contributions Contract (ACC).
- After a HUD audit, HUD demanded Weeks’ resignation as part of an amended Voluntary Compliance Agreement (VCA); HUD participated in June 23–24, 2011 negotiations that produced a severance deal (resignation, return of property, $125,000, six months insurance).
- HUD withdrew support for the severance on June 28, 2011, told OHA not to pay Weeks, and threatened to freeze OHA’s accounts and withhold approval to hire a replacement; OHA terminated Weeks in October 2011.
- Weeks sued OHA and employees asserting due process, equal protection, race discrimination, and breach of the severance agreement; she later added HUD and HUD’s Secretary but HUD/Secretary were dismissed from the case earlier on sovereign-immunity grounds.
- OHA moved under Rules 12(b)(7) and 19 to dismiss because HUD is a required party that cannot be joined due to sovereign immunity; the Court agreed and dismissed Weeks’ claims without prejudice.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Is HUD a required/required-party under Rule 19(a)? | Weeks: premature to conclude HUD exerts decisive control over OHA’s finances; not clearly required. | OHA: HUD controls OHA’s funds and bank accounts under the ACC/GDA, so HUD is necessary for complete relief and to avoid inconsistent obligations. | HUD is a required party under Rule 19(a); its absence prevents complete relief and creates risk of inconsistent obligations. |
| If HUD is required but cannot be joined, should the suit proceed under Rule 19(b)? | Weeks: action should proceed; relief against OHA is still meaningful. | OHA: proceeding would unfairly prejudice OHA and HUD; relief would be ineffective because HUD controls funding and could block payment. | Court: Rule 19(b) factors favor dismissal; proceeding without HUD would prejudice both OHA and HUD and yield inadequate relief. |
| Does sovereign immunity prevent joinder of HUD and thus necessitate dismissal? | Weeks: pursued claims in district court; argued aspects not solely about HUD contract. | OHA: HUD cannot be joined because of sovereign immunity and prior dismissal of HUD from the case. | Court: HUD cannot be joined due to sovereign immunity (HUD previously dismissed); that inability requires dismissal under Rule 19(b). |
| Does Weeks have an adequate alternative remedy if the case is dismissed? | Weeks: district forum appropriate for constitutional and contract claims. | OHA: Weeks can pursue contract claims against HUD in the Court of Federal Claims. | Court: Weeks has an adequate alternative (Court of Federal Claims for breach by the federal party); dismissal without prejudice appropriate. |
Key Cases Cited
- Molinos Valle Del Cibao, C. por A. v. Lama, 633 F.3d 1330 (11th Cir. 2011) (discussing Rule 19(b) pragmatic balancing and factors)
- Laker Airways, Inc. v. British Airways, PLC, 182 F.3d 843 (11th Cir. 1999) (non-joined party may be indispensable when suit indirectly attacks its conduct)
- Boles v. Greeneville Hous. Auth., 468 F.2d 476 (6th Cir. 1972) (challenge to housing project constituted indirect attack on HUD and made HUD indispensable)
- Challenge Homes, Inc. v. Greater Naples Care Ctr., Inc., 669 F.2d 667 (11th Cir. 1982) (pragmatic considerations control Rule 19(a) analysis)
- Clinton v. Babbitt, 180 F.3d 1081 (9th Cir. 1999) (contracting party that cannot be joined due to sovereign immunity can be indispensable)