Johnson v. Sawyer

United States Court of Appeals,

Fifth Circuit.

No. 91-2763.

Elvis E. JOHNSON, Plaintiff-Appellee,

v.

Robert SAWYER, et al., Defendants,

United States of America, Defendant-Appellant.

March 16, 1995.

Appeal from the United States District Court for the Southern

District of Texas.

Before POLITZ, Chief Judge, KING, JOHNSON, GARWOOD, JOLLY,

HIGGINBOTHAM, DAVIS, JONES, SMITH, DUHÉ, WIENER, BARKSDALE, EMILIO

M. GARZA and DeMOSS, Circuit Judges.*

GARWOOD, Circuit Judge:

In this Federal Tort Claims Act (FTCA)1 suit, Elvis Johnson

(Johnson) was awarded a ten million dollar judgment against the

United States for the issuance by Internal Revenue Service (IRS)

personnel of two press releases concerning Johnson's recent

conviction for filing a false and fraudulent federal income tax

return contrary to 26 U.S.C. § 7201. Johnson claimed, and the

district court found, that issuance of the press releases violated

26 U.S.C. § 6103(a)(1), which proscribes disclosure of tax return

information by federal employees, and caused him to lose his job as

the senior executive vice president of American National Insurance

*

Judges Benavides, Stewart, and Parker were not members of

the Court when this case was submitted en banc and did not

participate in this decision.

1

28 U.S.C. § 1346, 2671-2680.

1

Company, one of the largest life insurance companies in the United

States. Johnson v. Sawyer, 760 F.Supp. 1216 (S.D.Tex.1991). See

also id., 640 F.Supp. 1126 (S.D.Tex.1986). On the government's

appeal, a divided panel of this Court affirmed the determination of

liability. Johnson v. Sawyer, 980 F.2d 1490, 4 F.3d 369 (5th

Cir.1993).2 We voted the case en banc, and now reverse. The panel

majority held that the issuance of the press releases violated

section 6103(a) and that this violation established the FTCA

required liability under local law, either under the Texas invasion

of privacy tort, which denounces the public disclosure of

embarrassing private facts about another, although none of the

facts so disclosed were private, or under the Texas negligence per

se doctrine. We reject the reasoning of the panel majority,

because it ultimately grounds the duty not to disclose on federal

law, and under the FTCA recovery may only be had on the basis of

local law, here that of Texas.

Facts and Proceedings Below

Factual Context

Johnson, a long-time American National executive, was assigned

to its headquarters in Galveston, Texas, in 1972, and he and his

wife bought a home there at 25 Adler Circle one or two years later.

By 1976 he had become senior executive vice president and a member

of American National's board of directors. The board varied in

size from ten to twelve members. By the time of the events in

2

The panel reduced the economic damages award from

$5,902,117 to $5,075,857, and remanded the $5,000,000 noneconomic

damages award for further findings.

2

issue, Johnson had become the company's number two executive,

second only to the president, and both he and the president

reported directly to the board. In the late 1970s, the IRS began

detailed examination of the income tax returns of Johnson and his

wife for the years 1972 through 1975. The examining agent referred

the matter to the IRS Criminal Investigation Division, which

ultimately assigned it to Special Agent Robert Stone (Stone).

Following the criminal investigation, the Department of Justice

reviewed the matter and recommended prosecution for tax evasion for

the years 1974 and 1975 under section 7201, which then provided for

a maximum prison term of five years and a $10,000 fine for "[a]ny

person who willfully attempts in any manner to evade or defeat any

tax imposed by this title." The case was assigned to Assistant

United States Attorney Powers.

Johnson had kept the company lawyers, the president, and one

or two other directors informed of his problems with the IRS. He

was also represented by his own counsel. On January 9, 1981,

Powers wrote Johnson's lawyer that the Department of Justice, after

review by its Tax Division, had directed that an indictment be

sought against both Mr. and Mrs. Johnson. On February 4, 1981,

Powers again wrote Johnson's attorney stating that he planned to

seek an indictment of Mr. and Mrs. Johnson under both section 7201

and 26 U.S.C. § 7206(1) (filing false return), but that if Johnson

pleaded guilty to a one-count section 7201 information the

government would forego prosecution of Mrs. Johnson and would

recommend a probated sentence. A February 13, 1981, letter from

3

Johnson's lawyer to Johnson stated that Powers and the lawyer

agreed they would seek the district judge's authorization to have

a presentence investigation performed before charges were filed,

which would "involve contacts with ... a select group of

individuals to find out whether you are a good citizen." The

letter also references "fifty or so statements" that had been

submitted to the government on Johnson's behalf. After the

presentence investigation report (PSR) was reviewed, there would be

a meeting with the judge to discuss probation and an offer to enter

a nolo contendere plea. After the meeting with the judge, they

would decide whether "we would rather try the case." The plea

would be entered about 5:00 p.m. some afternoon, to a one count

information.

By March 18, 1981, Johnson and his counsel had filed with the

court consents to institution of the presentence investigation, and

the PSR was ultimately delivered to the district court on April 2,

1981. On March 31, 1981, Johnson's counsel wrote the district

clerk "Re: E.E. Johnson" confirming that "this captioned matter"

would be heard "Friday, August 10, at 4:00 p.m. in the courtroom in

Galveston," Texas. On April 3, 1981, Johnson's attorney wrote

Powers stating that "we request" that the information be filed at

the time of the hearing, that the waiver of indictment and the

"Plea Bargain Agreement" would "be filed at the same time," and

that "the "Defendant's Information Sheet' prepared by your office

reflect Mr. Elvis Johnson's address c/o 28th Floor, 1100 Milam

Street, Houston, Texas 77002, which is our office address." This

4

letter also enclosed "a proposed information." In that document,

the defendant is said to be "Elvis Johnson, A/K/A "Gene' Johnson,"

and no reference is made to the defendant's address.

At approximately 4:00 p.m. Friday, April 10, 1981, Johnson's

lawyer and Powers met with the district judge in his office. When

they came out, Johnson's lawyer informed him that the judge would

not accept a nolo contendere plea. Thereafter, at 4:10 p.m.

proceedings on the record were commenced in open court in the

Galveston federal courtroom before the district judge. Johnson

signed and filed a waiver of indictment.3 An information was filed

charging Johnson as follows:

"That on or about April 15, 1976, in the Southern

District of Texas, the defendant ELVIS JOHNSON, a resident of

Galveston, Texas, did willfully and knowingly attempt to evade

and defeat a large part of the income tax due and owing by him

to the United States for the calendar year 1975, by preparing

and causing to be prepared, by signing and causing to be

signed, and by mailing and causing to be mailed, in the

Galveston Division of the Southern District of Texas a false

and fraudulent income tax return, which was filed with the

Internal Revenue Service, wherein he stated and represented

that his taxable income for said calendar year was $53,589.00

and that the amount of tax due and owing thereon was the sum

of $18,374.50, whereas, as he then and there well knew, his

taxable income for 1975 was $59,784.18 upon which said taxable

income he owed to the United States an income tax of

$21,849.47. (Violation: Title 26, United States Code,

Section 7201)."

Johnson then also signed and swore to a written "Plea of Guilty,"

also signed "approved" by Powers, which was then filed. This

3

The waiver recites that Johnson is accused of violating

both section 7201 and section 7206(1).

There was also filed at that time the "Defendant

Information" sheet (form AO-257) listing the defendant as

"Elvis Johnson" and showing his address as "1100 Milam St.,

28th Floor, Houston, Texas 77002."

5

document concludes by stating:

"After consulting with my attorney, I have entered into

the following agreement, in the nature of "plea bargaining'

with the United States Attorney to this effect, and no

further: In the event I enter a plea of guilty to this

Information, I will not be prosecuted for violation of Title

26, for the year 1974. Further, Mrs. Johnson will not be

prosecuted for either of the years 1974 or 1975. Finally, the

Government will not oppose a probated sentence."4

Being informed that Johnson desired to plead guilty, the

district court (Judge Gibson) advised Johnson of his rights,

examined him and his counsel in accordance with FED.R.CRIM.P. 11 to

insure that the plea was entirely knowing and voluntary,

ascertained that the terms of the plea agreement were as above set

out, had Powers recite the factual basis of the offense,5 and had

the information read in full. On inquiry of the court, Johnson

stated that he pleaded "guilty," and the court accepted the plea.

After Johnson and his counsel declined the court's invitation to

4

The written "Plea of Guilty" also recites "I have received

no promises of leniency, or of any other nature, from my own

attorney, from the attorney of the United States, or from any

other person to induce me to plead guilty" and "I have received

no threat of a more severe sentence, of harsh treatment, or of

any other nature to induce me to plead guilty" and "I understand

the elements of the offense, and I am entering this plea of

guilty ... because I am guilty."

5

The factual basis was as follows:

"During the year in question, the Defendant attempted

to evade a substantial amount of tax that was due to

the United States. This attempt was willful and was

accomplished by a filing of an income tax return that

the Defendant knew was not correct in that it did not

report all of the income earned by the Defendant on his

tax return. At the time the Defendant signed the

income tax return, his actions were knowing and willful

with respect to the year 1975."

6

say anything about sentencing or the PSR,6 the court proceeded to

sentence Johnson to six months' confinement with execution of the

sentence suspended for a one-year probationary period. The court

stated on the record that the probation would be "supervised," but

the supervision would be relaxed so it would "not interfere with

the performance of your duties as an executive for the American

National Insurance Company."7

On Monday, April 13, 1981, Stone, who was stationed in Houston

and had talked to Powers on the telephone concerning what happened

at the courthouse on Friday, called Sally Sassen (Sassen), the IRS

District Public Affairs Officer who was based in Austin,8 and gave

her information to prepare a press release. Based on what Powers

told her, Sassen drafted a release and called Stone and read it to

him and he approved it.9 Sassen also cleared the release with

6

The court had previously stated that "the court is going to

follow the recommendation of the government, and that probation

will be accorded you."

7

Shortly thereafter, at 4:35 p.m., the open court

proceedings concluded. On April 13, 1981, the written judgment

of conviction and sentence was filed, showing, inter alia, the

full name of Johnson's counsel. On July 24, 1981, the transcript

of the April 10, 1981, proceedings was filed. The transcript

also reflects, inter alia, the full name of Johnson's counsel

(and the name of his firm, which includes his last name) and his

office address, "20th Floor, 1100 Milam Street, Houston, Texas"

(contemporaneous correspondence in the record plainly indicates

that "20th" is a misprint for "28th").

8

The IRS Austin District then included Houston and

Galveston.

9

Stone testified by deposition (he did not testify in

person) that after Sassen read him the proposed release, he

called Powers and cleared it with him and then called Sassen and

told her he had done so. The district court (Judge Singleton)

expressly disbelieved Stone's testimony that he had cleared the

7

Stone's superior in Houston. Sassen then mailed the press release

to twenty-one media outlets in the Galveston area later that day.

It read as follows:

"INSURANCE EXECUTIVE PLEADS GUILTY IN TAX CASE

GALVESTON, TEXAS—In U.S. District Court here, Apr. 10,

Elvis E. Johnson, 59, plead [sic] guilty to a charge of

federal tax evasion. Judge Hugh Gibson sentenced Johnson, of

25 Adler Circle, to a six-month suspended prison term and one

year supervised probation.

Johnson, an executive vice-president for the American

National Insurance Corporation, was charged in a criminal

information with claiming false business deductions and

altering documents involving his 1974 and 1975 income tax

returns.

In addition to the sentence, Johnson will be required to

pay back taxes, plus penalties and interest."

On April 14 or 15, the American National comptroller informed

Johnson that a Galveston journalist had called the American

National public relations director to inquire about Johnson's

conviction. A copy of the release was procured and furnished to

Johnson, who called his lawyer, who in turn called Powers on April

15. A recording of their telephone conversation reflects that

Powers denied any knowledge of the press release, assumed the IRS

was responsible, and said "[i]f they damaged your client in any

way, sue the hell out of them as far as I'm concerned."10 Johnson's

release with Powers. Sassen testified, without contradiction,

that Stone told her he had checked the release with the United

States Attorney.

10

As reflected by the recording, Johnson's lawyer complained

of the release "saying that Johnson for '74 and '75 has been

charged with altering a bunch of documents" and "putting matters

in the release that are matters that aren't covered by the public

record." Johnson's lawyer also then said to Powers "I was of the

view that you guys wouldn't have made such a release," to which

8

lawyer then called and wrote the IRS. As a result, the IRS

informed the media outlets to which it had sent the release that it

might contain errors and asked them to put a hold on it. The IRS

then procured a copy of the information to which Johnson had

pleaded, and on April 17, 1981, issued to the same outlets a new

press release as follows:

"INSURANCE EXECUTIVE PLEADS GUILTY IN TAX CASE

GALVESTON, TEXAS—In U.S. District Court here, Apr. 10,

Elvis E. Johnson, 59, plead [sic] guilty to a charge of

federal tax evasion. Judge Hugh Gibson sentenced Johnson, of

25 Adler Circle, to a six-month suspended prison term and one

year supervised probation.

Johnson, an executive vice-president for the American

National Insurance Corporation, was charged in a criminal

information with willful evasion of federal tax by filing a

false and fraudulent tax return for 1975.

In addition to the sentence, Johnson will be required to

pay back taxes, plus penalties and interest."

This release was the same as the earlier one except that the

words in the second paragraph of the release describing what the

criminal information charged Johnson with were changed from

"claiming false business deductions and altering documents

involving his 1974 and 1975 income tax returns," in the first

release, to "willful evasion of federal tax by filing a false and

fraudulent tax return for 1975" in the second release.

Johnson testified that when he returned from court on April

Powers responded, "[w]ell, we never make a release. Well, I say

we never make a release, that's not true. No we didn't make a

release in that case."

Neither Powers nor Johnson's lawyer testified at trial,

by deposition or otherwise.

9

10, he called the president of American National and told him what

had happened. The president told Johnson they would talk Monday

morning, April 13, which they did at about 8:00 a.m. The president

expressed his confidence in Johnson, and said it was best for the

company for Johnson to remain in his position. When Johnson

received a copy of the press release on April 14 or 15, he took it

to the president and told him he, Johnson, should go to the board

of directors and explain the situation. The president replied,

"Why don't you let me handle it. I can do it in a more personal

way and I will make sure the board understands about it." At this

time, Johnson testified, "we didn't have a board meeting coming up

for a few days." Johnson said he heard nothing further from the

matter until Saturday afternoon, which would have been April 18,

when the president called and then came by Johnson's house and told

him he, the president, had visited with two of the directors,

telling one of them "about the news release" and "in essence what

it said." This director's reply, according to what the president

told Johnson, was "well, did you get his resignation on the spot?"

Johnson further testified that the president then told him "I guess

that's why what I am asking you for right now is your resignation."

On Monday, April 20, Johnson resigned from American National's

board and from his position as its senior executive vice president.

He was assigned to its Springfield, Missouri, office, as assistant

regional director for the region including Missouri, Kansas,

Arkansas, Oklahoma, and part of North Texas. He served there, at

considerably diminished compensation, through 1986, at which time

10

he retired, having reached age 65 during that year.11

Johnson testified, without explanation other than as set forth

above, that he was "in essence" fired. However, only the board of

directors could terminate Johnson, and there is no evidence of any

such action by the board. Nor is there any evidence that even a

majority of the board was aware of Johnson's conviction before

April 22. No one who claimed to be privy to any decision to

terminate Johnson testified, nor did anyone who claimed to have

learned of any such decision from one who was privy to it. There

is no documentary evidence respecting any such decision. Apart

from Johnson himself, no present or former American National

director, officer, or employee testified.

Johnson further testified:

"Q. At some point you were going to tell the Board that you

were a tax felon?

A. It would be in the footnotes of the annual report, sir.

Q. And would have gone out to the board of directors?

A. And to the shareholders.

Q. And to the shareholders. And you were going to do that

regardless whether there was a press release?

A. It would have to have been done, yes, sir."12

11

American National issued a press release April 21

announcing Johnson's resignation "effective immediately" from the

board and his position as senior executive vice president, and

quoting the president as saying Johnson "many times expressed his

desire to return to Springfield in order to work more directly in

life insurance sales."

12

Johnson's testimony reflects that American National was a

publicly held corporation that sent annual reports to its

shareholders. When he first came to it in 1951, American

National was the 18th largest life insurance company out of some

11

In his testimony Johnson also asserted that he was not guilty

of tax evasion and that he was wholly unaware that any items

claimed as business expenses on his return were factually false or

overstated. He claimed that in these respects the returns were

based on his wife's erroneous recordkeeping, which he had assumed

to be correct. His wife testified in essence that her errors were

innocent. The district court apparently credited all their

testimony.13

17,000 such companies in the United States and Canada; it had

grown substantially since then, had thousands of employees and

offices throughout the United States, and had $105 million

profits in 1980. His brief describes it as "one of the largest

life insurance companies in the United States."

13

In so doing, the court in effect rejected the government's

contention that "this is a matter of res judicata, it's not open

to attack." In this respect, the district court clearly erred.

Johnson's section 7201 conviction has never been

challenged, much less set aside or modified. The count in

the information of which Johnson was convicted alleged that

he "willfully and knowingly attempted to evade and defeat a

large part of the income tax due and owing by him ... for

... 1975" by filing "a false and fraudulent income tax

return" that showed his taxable income and income tax at

specified figures, "whereas, as he then and there well knew

" the correct said figures were specified amounts, of

several thousand dollars, larger (emphasis added). The

italicized allegations were not surplusage, for we have

consistently held that a conviction under section 7201

requires that the defendant have "acted willfully and

knowingly with specific intent to evade his income tax

obligations." United States v. Daniels, 617 F.2d 146, 148

(5th Cir.1980). See also United States v. Garber, 607 F.2d

92, 97-98 (5th Cir.1979) ("a negligent, careless, or

unintentional understatement of income" does not violate

section 7201; rather, "[t]he Government must demonstrate

that the defendant willfully concealed and omitted from her

return income which she knew was taxable"). Moreover, the

district judge refused to accept a nolo plea from Johnson,

and, as the government pointed out below, Johnson's written

plea, which he signed and swore to in open court, stated

that he was "entering this plea of guilty ... because I am

12

District Court

On April 6, 1983, Johnson filed this suit in the court below

against Sassen and several other IRS employees asserting that the

press releases constituted a disclosure in violation of section

6103(a)(1), which prohibits any federal employee from disclosing

tax return information obtained by him in connection with his

government service.14 Recovery was sought on the basis of 26 U.S.C.

guilty" (emphasis added). Johnson's plea hence cannot be

characterized as an "Alford " plea. See North Carolina v.

Alford, 400 U.S. 25, 91 S.Ct. 160, 27 L.Ed.2d 162 (1970).

In this civil suit by Johnson against the United States,

Johnson is clearly estopped from taking any positions

inconsistent with his subsisting section 7201 conviction.

Piper v. United States, 392 F.2d 462, 464-65 (5th Cir.1968);

Tomlinson v. Lefkowitz, 334 F.2d 262, 264-65 (5th Cir.1964),

cert. denied, 379 U.S. 962, 85 S.Ct. 650, 13 L.Ed.2d 556

(1965); United States v. Thomas, 709 F.2d 968, 972 (5th

Cir.1983).

14

Section 6103(a) provides:

"(a) General rule.—Returns and return information

shall be confidential, and except as authorized by this

title—

(1) no officer or employee of the United States,

(2) no officer or employee of any State, any local

child support enforcement agency, or any local

agency administering a program listed in

subsection (l )(7)(D) who has or had access to

returns or return information under this section,

and

(3) no other person (or officer or employee

thereof) who has or had access to returns or

return information under subsection

(e)(1)(D)(iii), (l )(12), paragraph (2) or (4)(B)

of subsection (m), or subsection (n),

shall disclose any return or return information

obtained by him in any manner in connection with his

service as such an officer or an employee or otherwise

or under the provisions of this section. For purposes

13

§ 7217, which authorized a damage suit against any person who

disclosed return information contrary to section 6103.15

of this subsection, the term "officer or employee'

includes a former officer or employee."

Section 6103(b)(2) defines "return information" as

including:

"(A) a taxpayer's identity, the nature, source, or

amount of his income, ... deductions, ... liabilities,

... tax liability, ... deficiencies, ... whether the

taxpayer's return was, is being, or will be examined or

subject to other investigation or processing, or any

other data, received by, ... [or] prepared by ... the

Secretary with respect to a return or with respect to

the determination of the existence, or possible

existence, of liability (or the amount thereof) of any

person under this title for any tax, penalty, interest,

fine, forfeiture, or other imposition, or offense...."

Section 6103(b)(6) states that "[t]he term "taxpayer

identity' means the name of a person with respect to whom a

return is filed, his mailing address, his taxpayer

identifying number (as described in section 6109), or a

combination thereof."

15

Section 7217 provided:

"(a) General rule.—Whenever any person knowingly,

or by reason of negligence, discloses a return or

return information (as defined in section 6103(b)) with

respect to a taxpayer in violation of the provisions of

section 6103, such taxpayer may bring a civil action

for damages against such person, and the district

courts of the United States shall have jurisdiction of

any action commenced under the provisions of this

section.

(b) No liability for good faith but erroneous

interpretation.—No liability shall arise under this

section with respect to any disclosure which results

from a good faith, but erroneous, interpretation of

section 6103.

(c) Damages.—In any suit brought under the

provisions of subsection (a), upon a finding of

liability on the part of the defendant, the defendant

shall be liable to the plaintiff in an amount equal to

the sum of—

14

(1) actual damages sustained by the plaintiff as a

result of the unauthorized disclosure of the

return or return information and, in the case of a

willful disclosure or a disclosure which is the

result of gross negligence, punitive damages, but

in no case shall a plaintiff entitled to recovery

receive less than the sum of $1,000 with respect

to each instance of such unauthorized disclosure;

and

(2) the costs of the action.

(d) Period for bringing action.—An action to

enforce any liability created under this section may be

brought, without regard to the amount in controversy,

within 2 years from the date on which the cause of

action arises or at any time within 2 years after

discovery by the plaintiff of the unauthorized

disclosure."

Section 7217 was enacted as a part of the Tax Reform Act of

1976, Pub.L. 94-455, Title XII, § 1202(e)(1), 90 Stat. 1687,

and was amended in 1978. Pub.L. 95-600, § 701(bb)(7), 92

Stat. 2923.

In 1982, section 7217 was repealed and replaced by 26

U.S.C. § 7431 in legislation providing that "[t]he

amendments made by this section shall apply with respect to

disclosures made after the date of this Act [September 3,

1982]." Pub.L. 97-248, § 357(c), 96 Stat. 646. Hence, the

disclosures at issue here are governed by section 7217 and

not by section 7431.

Section 7431(a) provides for a cause of action against

the United States for disclosure by federal employees

contrary to section 6103. Section 7431(b) provides for a

cause of action against a person who is not a federal

employee for a disclosure made by such person in violation

of section 6103. Section 7431 states in this respect:

"(a) In general.—

(1) Disclosure by employee of United States.—If

any officer or employee of the United States

knowingly, or by reason of negligence, discloses

any return or return information with respect to a

taxpayer in violation of any provision of section

6103, such taxpayer may bring a civil action for

damages against the United States in a district

court of the United States.

15

At approximately the same time, Johnson filed with the IRS an

FTCA administrative claim, likewise asserting that the press

releases violated section 6103 and that the IRS was negligent in

(2) Disclosure by a person who is not an employee

of United States.—If any person who is not an

officer or employee of the United States

knowingly, or by reason of negligence, discloses

any return or return information with respect to a

taxpayer in violation of any provision of section

6103, such taxpayer may bring a civil action for

damages against such person in a district court of

the United States.

(b) No liability for good faith but erroneous

interpretation.—No liability shall arise under this

section with respect to any disclosure which results

from a good faith, but erroneous, interpretation of

section 6103.

(c) Damages.—In any action brought under subsection

(a), upon a finding of liability on the part of the

defendant, the defendant shall be liable to the

plaintiff in an amount equal to the sum of—

(1) the greater of—

(A) $1,000 for each act of unauthorized disclosure

of a return or return information with respect to

which such defendant is found liable, or

(B) the sum of—

(i) the actual damages sustained by the plaintiff

as a result of such unauthorized disclosure, plus

(ii) in the case of a willful disclosure or a

disclosure which is the result of gross

negligence, punitive damages, plus

(2) the costs of the action.

(d) Period for bringing action.—Notwithstanding any

other provision of law, an action to enforce any

liability created under this section may be brought,

without regard to the amount in controversy, at any

time within 2 years after the date of discovery by the

plaintiff of the unauthorized disclosure."

16

its supervision of those issuing the press releases. After six

months passed without action on the FTCA claim, Johnson filed an

amended complaint adding the United States as a defendant and

seeking recovery against it under the FTCA.16 As against the United

States, Johnson asserted that the press releases violated section

6103 and that IRS personnel were guilty of negligence and/or

intentional misconduct in issuing such releases and in failing to

take measures to prevent their issuance. The following were the

complained of items of return information allegedly disclosed in

the press releases contrary to section 6103:

"A. Plaintiff's age was disclosed;

B. Plaintiff's address was disclosed;

C. It was stated that Plaintiff was charged with false

business deductions and altering documents involving his 1974

and 1975 returns. The criminal information that had been

filed of record in the court proceeding dealt with the year

1975 and neither the criminal information nor other data in

the public record made references to "claiming false business

deductions and altering documents.'

D. Plaintiff's position as Executive Vice-President of

American National was stated.

E. It was stated that Plaintiff would be required to pay back

taxes plus penalties and interest."17

Johnson sought recovery from the United States of his actual

damages, alleging that he was discharged from his employment as a

result of the press releases, and consequently suffered humiliation

16

A second amended complaint named further individual IRS

employees, including Stone, as additional defendants from whom

recovery was sought under section 7217.

17

Virtually the same allegations were made in the FTCA

administrative claim.

17

and mental anguish, loss of earnings, and relocation expenses.18

He also sought to recover punitive damages from the United States.

The parties filed motions to dismiss and for summary judgment.

The district court denied the government's motion claiming a want

of FTCA jurisdiction, granted Johnson's motion that the press

releases violated section 6103 and the government's motion that it

could not be liable for punitive damages, and denied all the

individual defendants' motions except one relating to the

computation of liquidated damages under section 7217(c)(1).

Johnson v. Sawyer, 640 F.Supp. 1126 (S.D.Tex.1986) (Singleton, J.).

Thereafter, the case against the individual IRS employees was

severed, and the FTCA case proceeded to a bench trial following

which the district court ordered judgment in favor of Johnson.19

The district court found that the press releases were issued in

18

The Second Amended Complaint (the final complaint)

alleged:

"As to Defendant United States of America, Plaintiff is

entitled to recover judgment for his actual damages for

the following:

A. Plaintiff was discharged from his employment as

a result of the publication of Exhibit C [the April 13

press release]; such discharge, together with the

humiliation and mental anguish sustained by Plaintiff

and his family, caused actual damages of $7,500,000;

B. In addition, Plaintiff sustained other and

further damages of the nature of relocation expenses

and loss of earnings in the amount of at least

$1,000,000."

In substance, these were the allegations made in the

FTCA administrative claim.

19

So far as we are informed, the case against the individual

defendants remains pending.

18

violation of section 6103 and caused Johnson to be discharged from

his position as senior executive vice president and member of the

board of American National. Damages in the amount of $10,902,117

were awarded, of which $5,902,117 were for loss of earnings,

pension benefits, deferred compensation, and loss on the sale of

his Galveston house, and $5,000,000 was for "loss of position"

meaning "the aggregate of luxuries that are the familiar

perquisites of members of the corporate elite" and "emotional

distress and mental anguish." Johnson v. Sawyer, 760 F.Supp. 1216,

1233 (S.D.Tex.1991) (Singleton, J.).

Although the claimed invasion of Johnson's rights was

predicated on section 6103, the district court recognized that "an

FTCA claim must be based on a state law cause of action." Id. at

1224. The court stated that Johnson had advanced four theories of

recovery in this respect under Texas law, namely (1) respondeat

superior; (2) negligent supervision of employees; (3) breach of

a confidential relationship; and (4) violation of the right of

privacy. Id. at 1225.20

The district court held for Johnson on respondeat superior,

stating that "[t]he negligence of Stone and Sassen is clear.

Section 6103 created a duty; they breached that duty by engaging

in activity that led to the release of information not in the

public record," id. at 1230 (footnote omitted), and "[w]e hold the

20

The district court also rejected the government's reliance

on the discretionary function and tax exceptions to the FTCA, 28

U.S.C. § 2680(a) & (c). See Johnson, 760 F.Supp. at 1225-1228.

We do not reach and express no opinion concerning these rulings.

19

United States vicariously liable for the negligence of Sassen and

Stone." Id. at 1231. It also held for Johnson on negligent

supervision, noting that because under Texas law negligent

supervision is "superfluous" where the employee's offending action

was within the course and scope of his employment,21 therefore "a

finding of negligent supervision appears to follow almost

automatically from our finding of respondeat superior negligence.

We hold that the United States was negligent in its supervision of

Sassen and Stone ..." Id. at 1232.

The court rejected Johnson's invasion of privacy and breach of

confidential relationship claims. As to the former, the court

noted that under Texas law breach of privacy was divided "into four

distinct torts," of which Johnson "pleads only two," namely "public

disclosure of embarrassing facts about the Plaintiff" and "false

light." Id. at 1232. As to the first, the elements, under

Industrial Foundation of the South v. Texas Industrial Accident

Board, 540 S.W.2d 668 (Tex.1976), cert. denied, 430 U.S. 931, 97

S.Ct. 1550, 51 L.Ed.2d 774 (1977), were that (1) publicity was

given to matters concerning the plaintiff's private life, (2) the

publication of which would be highly offensive to one of ordinary

sensibilities, and (3) the matter publicized is not of legitimate

public concern. Johnson at 1332. Though "[s]keptical," the

district court was unable to find that postconviction press

releases do not help to deter prospective tax evaders, and stated

21

The district court cited Dieter v. Baker Service Tools,

739 S.W.2d 405, 408 (Tex.App.—Corpus Christi 1987, writ denied),

in this connection.

20

"we cannot, therefore, hold that the identity of those who are

convicted of violating the tax laws is not of legitimate public

concern." Id. The court did not address the other two elements of

this tort. As to the "false light" privacy claim, the district

court noted that Johnson claimed the press release "[p]laced him in

a false light in the public eye, by implying that he had admitted

to falsifying deductions and altering documents." The court held

this claim barred because "[i]ts essence is injury to Johnson's

reputation, and it therefore falls under 28 U.S.C. § 2680(h), which

exempts from the FTCA any claim arising from libel, slander or

misrepresentation." Id.

The district court, citing Thompson v. Norton, 604 S.W.2d 473,

476 (Tex.Civ.App.—Dallas 1980, no writ), also rejected the claim of

breach of confidential relationship, finding nothing akin to that

between attorney/client, partners, or family members, or long-time

relations of trust in which one party is justified in relying on

the other to act in his best interest. It also rejected the notion

that such a "concept embraces relations between a citizen and his

government." Johnson, 760 F.Supp. at 1233.

The government appealed.

Panel

The panel majority, in its initial opinion, Johnson v.

Sawyer, 980 F.2d 1490 (5th Cir.1992), affirmed the finding of

liability on a negligence per se theory, reasoning that "the IRS

agents' violations of ... the duty established in § 6103 amounted

to negligence under Texas tort law," id. at 1497, and holding that

21

the district court did not err "in finding that the actions of the

IRS agents violated § 6103, and that when such a violation of a

statute injures persons whose interests are intended to be

protected by the statute, the violation constitutes a tort under

Texas law, thereby implicating the FTCA." Id. at 1505. Neither

Johnson nor the panel addressed the district court's holdings

rejecting recovery on the basis of publication of embarrassing

private facts about another, false light, and breach of

confidential relation.22 The panel made a reduction in the portion

22

The initial panel majority opinion also rejected the

government's argument that Johnson's suit was in contract, not

tort, and hence was not covered under the FTCA. See Paul v.

United States, 929 F.2d 1202, 1204 (7th Cir.1991) ("Claims based

on the plea bargain invoke contract, not tort" and hence are

excluded from the FTCA); City National Bank v. United States,

907 F.2d 536, 546 (5th Cir.1990) (grossly negligent breach of

contractual duty excluded from FTCA as contract claim); 28

U.S.C. § 2680(h) (excluding from FTCA claims for

"misrepresentation, deceit, or interference with contract

rights"). In this connection, the panel majority correctly noted

that

"The government mischaracterizes both Johnson's cause

of action and the basis for the district court's

judgment. Neither relied on breach of the plea

agreement.... [T]he IRS was not even a party to the

plea agreement between the Department of Justice

[actually, the United States Attorney] and Johnson, and

thus had no privity with Johnson. Without privity

there can be no breach of contract. Moreover, Johnson

never asserted that the government was liable to him

because the IRS violated his agreement with the

Department of Justice. To the contrary, Johnson has

consistently asserted that the government's liability

results from violation of its duty toward him as

established by § 6103." Johnson, 980 F.2d at 1501

(footnote omitted).

See also id. n. 42: "The plea agreement specified only that

the Justice Department would not issue a press release."

We also observe that neither Johnson's FTCA

22

of the award for lost pension benefits and remanded for further

findings the $5,000,000 portion of the award for noneconomic

damages from loss of position and associated emotional distress.

The panel majority subsequently issued a "Supplemental and

administrative claim nor his second amended complaint make

any reference whatsoever to even the existence, much less

the breach, of any agreement (or plea agreement) between

Johnson and any officer or employee of the United States.

Further, most of what the district court found was

"agreed" by "Powers" as "part of the plea bargain," Johnson,

760 F.Supp. at 1221, is not a part of the sworn, written

"plea of guilty" which purported to state the full extent of

the government's obligations (see text at n. 4), and is not

supported by any writing. The district court's finding that

Powers agreed that "the U.S. Attorney's office would publish

no press release" is supported by no writing and the only

testimony in that respect is the following by Johnson under

examination by his own counsel: "Q. And do you recall that

he [Powers] agreed, or at least that I told you he had

agreed to not make a news release? A. That was my

understanding, yes, sir." (Emphasis added).

The only record support for the district court's

findings that Powers agreed (a) "all papers filed in the

case would give plaintiff's name as "Elvis Johnson' rather

than "E.E. "Johnny" Johnson,' by which he is normally known"

and (b) "papers requiring Johnson's street address would

give it as 1100 Milam Street in Houston, which was the

address of his attorney, and no reference to his address at

25 Adler Circle, Galveston, would be made," are: (1)

Johnson's testimony on direct, when asked of "a plea bargain

that we made with Mr. Powers, your recollection," that "my

recollection is that I would be referred to as Elvis

Johnson, that my address would be shown as 28th Floor 1100

Milam in Houston," and (2) the April 3, 1981, letter from

Johnson's lawyer to Powers stating "we request" that "the

"Defendant's Information Sheet' prepared by your office

reflect Mr. Elvis Johnson's address c/o 28th Floor, 1100

Milam Street, Houston, Texas 77002, which is our office

address."

Finally, we note that there is no finding nor any

evidence that any IRS employee was aware of any agreement

between Powers and Johnson's counsel (or Johnson) not

contained in the written "Plea of Guilty" (see text at n. 4

supra ), or even of all the terms of that document.

23

Amending" opinion. Johnson v. Sawyer, 4 F.3d 369 (5th Cir.1993).

That opinion held that "Texas courts have consistently recognized

that the existence of a duty is the threshold question in a

negligence action," id. at 377 (footnote omitted), and that

"[i]nstead of creating a duty on the part of the IRS toward Johnson

(as found by the district court and as initially found by this

panel's majority), § 6103 simply establishes a standard of care

applicable to the independently existing duty to refrain from

publicizing damaging or embarrassing private facts about another

person." Id. at 378.23 The opinion further held that "Texas

recognizes an invasion of privacy cause of action for public

disclosure of private facts," id. at 373, and, despite the fact

that Johnson did not so contend before this Court, went on to hold

"that the district court erred in not holding for Johnson on his

public disclosure cause of action." Id. at 376. The panel

majority did not modify any of its other previous holdings and

ultimately reached the same result as it had originally.

We took the case en banc, thus vacating the panel opinions.

Discussion

FTCA Requires Breach of State Law Duty

The FTCA, subject to several exceptions, waives the sovereign

immunity of the United States, making it liable in tort "in the

same manner and to the same extent as a private individual under

23

Similarly, the opinion states "[w]e do realize, however,

that the district court did err (as did we originally) in stating

that § 6103 created a duty when it actually only established a

standard of conduct." Id. at 392.

24

like circumstances," 28 U.S.C. § 2674, for certain damages "caused

by the negligent or wrongful act or omission of any employee of the

Government while acting within the scope of his office or

employment, under circumstances where the United States, if a

private person, would be liable to the claimant in accordance with

the law of the place where the act or omission occurred." 28

U.S.C. § 1346(b) (emphasis added). While as a matter of abstract

linguistics the phrase "law of the place where the act or omission

occurred" might be thought to include generally applicable federal

law, it has long been settled that it does not, and that "the

liability of the United States under the Act [FTCA] arises only

when the law of the state would impose it." Brown v. United

States, 653 F.2d 196, 201 (5th Cir.1981). Thus, even a violation

of the United States Constitution, actionable under Bivens,24 is not

within the FTCA unless the complained of conduct is actionable

under the local law of the state where it occurred. Brown at 201.

It follows, of course, and has consistently been held, that

"the FTCA was not intended to redress breaches of federal statutory

duties." Sellfors v. United States, 697 F.2d 1362, 1365 (11th

Cir.1983). As the Second Circuit said in Chen v. United States,

854 F.2d 622, 626 (2d Cir.1988):

"The FTCA's "law of the place' requirement is not satisfied by

direct violations of the Federal Constitution, see

Contemporary Mission, Inc. v. U.S.P.S., 648 F.2d 97, 104-05 n.

2 (2d Cir.1981); Birnbaum v. United States, 588 F.2d 319, 328

(2d Cir.1978), or of federal statutes or regulations standing

alone, Cecile Indus., Inc. v. United States, 793 F.2d 97, 100

24

Bivens v. Six Unknown Named Agents of Federal Bureau of

Narcotics, 403 U.S. 388, 91 S.Ct. 1999, 29 L.Ed.2d 619 (1971).

25

(3d Cir.1986); Art Metal—U.S.A., Inc. v. United States, 753

F.2d 1151, 1157-58 (D.C.Cir.1985); Birnbaum, 588 F.2d at 328;

Nichols [v. Block], 656 F.Supp. [1436] at 1444-45 [

(D.Mont.1987) ]. The alleged federal violations also must

constitute violations of duties "analogous to those imposed

under local law.' Cecile Indus., 793 F.2d at 100 (quoting Art

Metal, 753 F.2d at 1158.)"

See also, e.g., Zabala Clemente v. United States, 567 F.2d 1140,

1149 (1st Cir.1977) ("... even where specific behavior of federal

employees is required by federal statute, liability to the

beneficiaries of that statute may not be founded on the Federal

Tort Claims Act if state law recognizes no comparable private

liability"); Gelley v. Astra Pharmaceutical Products, Inc., 610

F.2d 558, 562 (8th Cir.1979) ("... federally imposed obligations,

whether general or specific, are irrelevant to our inquiry under

the FTCA, unless state law imposes a similar obligation upon

private persons").

We have long followed this rule. United States v. Smith, 324

F.2d 622, 624-25 (5th Cir.1963) (the FTCA "simply cannot apply

where the claimed negligence arises out of the failure of the

United States to carry out a [federal] statutory duty in the

conduct of its own affairs" and is unavailable where "[t]he

existence or nonexistence of the claim" "depends entirely upon

Federal statutes"); Brown; Tindall v. United States, 901 F.2d 53,

56 at n. 8 (5th Cir.1990) ("a federal regulation cannot establish

a duty owed to the plaintiff under state law," citing Smith ). See

also Bosco v. U.S. Army Corps of Engineers, 611 F.Supp. 449, 454

(N.D.Tex.1985).

This is not to say that the required state law must be one

26

directly applicable to the conduct of federal employees or to the

precise activity from which the claim arose. The Supreme Court

made this clear in Indian Towing Co. v. United States, 350 U.S. 61,

64-65, 76 S.Ct. 122, 124, 100 L.Ed. 48 (1955), where it held that

the United States could be liable under the FTCA for the Coast

Guard's negligence in the operation of its lighthouse, asserting

"it is hornbook tort law that one who undertakes to warn the public

of a danger and thereby induces reliance must perform his "good

Samaritan' task in a careful manner." See also Block v. Neal, 460

U.S. 289, 293-95, 103 S.Ct. 1089, 1092, 75 L.Ed.2d 67 (1983).

Although Indian Towing did not expressly refer to state law,

subsequent decisions have made plain that in FTCA cases "the

application of the "Good Samaritan' doctrine is at bottom a

question of state law." United States v. S.A. Empresa de Viacao

Aerea Rio Grandense (Varig Airlines), 467 U.S. 797, 816 n. 12, 104

S.Ct. 2755, 2765 n. 12, 81 L.Ed.2d 660 (1984). See also Sheridan

v. United States, 487 U.S. 392, 400-01, 108 S.Ct. 2449, 2455, 101

L.Ed.2d 352 (1988). If the government undertakes to perform a

duty, such as to furnish a lighthouse service or direct air

traffic, and negligently performs that duty, then it may be liable

under the FTCA if a similarly situated private enterprise would be

liable under the local law good Samaritan rule.25 We have applied

25

As the Court said in Sheridan,

"By voluntarily adopting regulations that prohibit the

possession of firearms on the naval base and that

require all personnel to report the presence of any

such firearm, and by further voluntarily undertaking to

provide care to a person who was visibly drunk and

27

the same theory in FTCA cases involving air traffic controllers.

See Gill v. United States, 429 F.2d 1072, 1075 (5th Cir.1970).26

The teaching of these authorities is that the violation of a

federal statute or regulation does not give rise to FTCA liability

unless the relationship between the offending federal employee or

agency and the injured party is such that the former, if a private

person or entity, would owe a duty under state law to the latter in

a nonfederal context. If the requisite relationship and duty

exist, then the statutory or regulatory violation may constitute or

be evidence of negligence in the performance of that state law

duty.

Negligence Per Se

In accordance with the foregoing, in FTCA cases courts have

generally refused to find the necessary state law duty in an

assertedly violated federal statute or regulation merely because

visibly armed, the Government assumed responsibility to

"perform [its] "good Samaritan" task in a careful

manner.' " Indian Towing Co. v. United States, 350

U.S. 61, 65, 76 S.Ct. 122, 124, 100 L.Ed. 48 (1955).

"The District Court and the Court of Appeals both

assumed that petitioners' version of the facts would

support recovery under Maryland law on a negligence

theory if the naval hospital had been owned and

operated by a private person." Id., 487 U.S. at 401,

108 S.Ct. at 2455 (footnote omitted).

26

Gill was a Texas case. Texas has recognized the good

Samaritan doctrine since well before enactment of the FTCA. See,

e.g., Colonial Savings Ass'n v. Taylor, 544 S.W.2d 116, 119

(Tex.1976). Similarly, in an action between private parties who

owe a duty one to the other under general state law, such as the

duties owed by a seller to a buyer in respect to the quality of

the goods sold, violation of applicable federal law may

constitute a breach of that duty under a negligence per se

concept, just as would violation of state law. See Gibson v.

Worley Mills, Inc., 614 F.2d 464, 466 (5th Cir.1980).

28

the law of the relevant state included a general doctrine of

negligence per se. Thus in Art Metal—U.S.A., Inc. v. United

States, 753 F.2d 1151 (D.C.Cir.1985), the D.C. Circuit rejected

FTCA liability sought to be predicated on a violation of federal

regulations, notwithstanding that local law had a broad negligence

per se doctrine and the plaintiffs were intended beneficiaries of

the regulatory provisions violated. The court observed: "[d]uties

set forth in federal law do not, therefore, automatically create

duties cognizable under local tort law. The pertinent question is

whether the duties set forth in the federal law are analogous to

those set forth in local tort law." Id. at 1158 (citing Indian

Towing Co.). This language and holding were cited with approval by

the Third Circuit in Cecile Industries, Inc. v. United States, 793

F.2d 97, 100 (3d Cir.1986). And, in Myers v. United States, 17

F.3d 890 (6th Cir.1994), the court refused to authorize FTCA

recovery on the basis of breach of a duty imposed by federal

regulations. Myers cites Art Metal with approval as

"characterizing plaintiff's attempt to invoke doctrine of

negligence per se without establishing an underlying state-law duty

as a "mistake' and a "flawed analysis.' " Myers at 899.

Where a claim is wholly grounded on a duty imposed by an

allegedly violated federal statute or regulation, to allow FTCA

recovery merely on the basis of a general state doctrine of

negligence per se, without requiring that there be some specific

basis for concluding that similar conduct by private persons or

entities would be actionable under state law, is to in essence

29

discriminate against the United States: recovery against it is

allowed, although for similar conduct the private person or entity

would not be subject to liability under state law. Plainly, the

FTCA waiver of sovereign immunity does not go so far. To allow

section 6103(a)(1) to create the duty allegedly breached merely

because Texas generally follows the doctrine of negligence per se

violates the rule of Tindall that for FTCA purposes "a federal

regulation cannot establish a duty owed to the plaintiff under

state law." Id. at 56 n. 8 (citing Smith ). Accordingly, we hold

that the relevant duty not to disclose must be found in Texas law

apart from section 6103(a)(1) and the Texas doctrine of negligence

per se.

Even apart from the foregoing, there is no showing that Texas

would create a common law cause of action for violation of section

6103(a)(1), inasmuch as section 7217 provided for a comprehensive

private cause of action for any such violation (see n. 15 supra ).

While Texas generally recognizes the doctrine of negligence per se,

see El Chico Corp. v. Poole, 732 S.W.2d 306 (Tex.1987), no Texas

decision has been found applying the doctrine to create a common

law cause of action for a statutory violation where there is a

comprehensive and express statutory private cause of action for the

statutory violation. Moreover, in this instance both the statute

violated and the statute creating the cause of action for that

violation are federal. We can think of no reason for a Texas court

to create a common law cause of action for the statutory violation

30

in such a circumstance.27 We have long followed the principle that

we will not create "innovative theories of recovery or defense"

under local law, but will rather merely apply it "as it currently

exists." Galindo v. Precision American Corp., 754 F.2d 1212, 1217

(5th Cir.1985) (footnote omitted). See also, e.g., Junior Money

Bags, Ltd. v. Segal, 970 F.2d 1, 11 (5th Cir.1992); Mitchell v.

Random House, Inc., 865 F.2d 664, 672 (5th Cir.1989); Graham v.

Milky Way Barge, Inc., 824 F.2d 376, 381 (5th Cir.1987); Harmon v.

Grande Tire Co., 821 F.2d 252, 259 (5th Cir.1987). As there is

currently no Texas law creating a common law cause of action for a

statutory violation for which violation there is an express and

comprehensive statutory cause of action, we will not undertake to

ourselves create such a Texas common law cause of action.28

27

State as well as federal courts would be available for

section 7217 suits, as its grant of federal jurisdiction does not

purport to be exclusive. See, e.g., Tafflin v. Levitt, 493 U.S.

455, 110 S.Ct. 792, 107 L.Ed.2d 887 (1990).

28

Our proper reluctance to take such a step is enhanced by

the concern, which would surely be shared by Texas judges, that

any such Texas common law cause of action predicated solely on a

violation of section 6103(a)(1) might well be preempted by

section 7217. We deal here only with federal employees acting in

the course of their employment, and the only portion of section

6103(a) which extends its prohibitions to them is clause (1),

which states "no officer or employee of the United States"

(clause (2) describes specified state and local governmental

employees, and clause (3) speaks to specified "other person[s]"

(emphasis added), thus excluding federal employees). In Boyle v.

United Technologies Corp., 487 U.S. 500, 503-06, 108 S.Ct. 2510,

2514-15, 101 L.Ed.2d 442 (1988), the Supreme Court stated:

"Another area that we have found to be of peculiarly federal

concern, warranting the displacement of state law, is the civil

liability of federal officials for actions taken in the course of

their duty. We have held in many contexts that the scope of that

liability is controlled by federal law." See also, e.g., United

States v. Demko, 385 U.S. 149, 152, 87 S.Ct. 382, 384, 17 L.Ed.2d

258 (1966) (federal compensation statute preempts FTCA; "[t]here

31

Respondeat superior; Negligent Supervision

The district court held that the fact that Stone and Sassen,

within the scope of their employment, violated section 6103(a)(1),

though not thereby committing a tort under local law, nevertheless

sufficed to impose liability on the United States under the FTCA,

because Texas follows the doctrine of respondeat superior and thus

holds private employers liable for the torts committed by their

employees in the course and scope of their employment. So far as

we are aware, no other court has adopted this approach in an FTCA

case. We reject it for essentially the same reason we have held

that general state law principles of negligence per se do not

suffice to convert a duty created only by federal statute into one

owing under state law for purposes of the FTCA's requirement that

liability thereunder be that which would be imposed on a private

party by local law. All states recognize the general doctrine of

respondeat superior, and did so when the FTCA was enacted; and,

the FTCA itself applies only to the conduct of a federal "employee

is no indication of any congressional purpose to make the

compensation statute in 18 U.S.C. § 4126 non-exclusive");

Rollins v. Marsh, 937 F.2d 134, 139-140 (5th Cir.1991) (Civil

Service Reform Act preempts both FTCA and state law claims);

Atkinson v. Gates, McDonald & Co., 838 F.2d 808, 812-13 (5th

Cir.1988) (despite absence of express preemptive language,

Longshore and Harbor Workers' Compensation Act remedy for

stopping compensation without notice of controversion preempts

state law tort action for bad faith practices). We need not now

ultimately resolve the issue of whether Texas could have created

a cause of action for violation of section 6103(a)(1) where a

comprehensive cause of action for such a violation was provided

by section 7217 (nor need we now resolve the analogous issue of

whether section 7217 preempts the FTCA). These substantial

preemption concerns are but an additional reason for us not to

create such a cause of action for Texas when it has not already

done so.

32

... while acting within the scope of his office or employment."

Section 2674. All FTCA liability is respondeat superior liability.

To say that the only local law we must look to is that of

respondeat superior is to in effect render the FTCA's local law

component substantially meaningless. Respondeat superior does not

impose liability on the employer unless the employee's conduct has

been actionable. See, e.g., Knutson v. Morton Foods, Inc., 603

S.W.2d 805, 807 n. 2 (Tex.1980) ("It is well established that where

the employer's liability rests solely on respondeat superior, an

adjudication acquitting the employee of negligence will stand as a

bar to a subsequent suit against the employer"). A private

employer is not liable under local law if the complained of conduct

of his employee, though within the scope of employment, is not

tortious under local law. Under the FTCA, the United States is not

liable if the private employer would not be liable pursuant to

local law.

The same analysis applies to the negligent supervision

theory. This tort came into Texas law by way of analogy to

negligent entrustment. See, e.g., Deerings West Nursing Center v.

Scott, 787 S.W.2d 494, 495-96 (Tex.App.—El Paso 1990, writ denied);

Park North General Hospital v. Hickman, 703 S.W.2d 262, 265-66

(Tex.App.—San Antonio 1985, n.r.e.). Texas negligent entrustment

law clearly requires, inter alia, that the accident or occurrence

injuring the plaintiff have been proximately caused by the tortious

conduct of the person to whom the vehicle (or other

instrumentality) was negligently entrusted. See, e.g., Schneider

33

v. Esperanza Transmission Co., 744 S.W.2d 595, 596-97 (Tex.1987).

Likewise, in negligent hiring or supervision cases, the general

rule is clearly that "liability ... must be predicated upon the

wrongful act or omission of the employee at the time of the

infliction of the injury complained of ... and, if the employee is

guilty of no such act or omission, there is no liability on the

part of the employer, however inexperienced, incompetent, and unfit

the employee may have been for his task." 53 AM.JUR.2d Master and

Servant § 422 at 435. Other courts reach the same result on the

basis of "proximate cause," which "requires that the third person

must have been injured by some negligent or other wrongful act of

the employee so [negligently] hired." Id. at 437. See also, e.g.,

Texas Skaggs, Inc. v. Joannides, 372 So.2d 985, 987

(Fla.App.1979).29 We are aware of no reported Texas decision to the

contrary. Where liability has been imposed on the employer on a

negligent hiring or supervision basis, it has always been where the

plaintiff's injury was caused by an employee's conduct that was

tortious under Texas law.30 No rational law would impose liability

29

There the court held: "... Florida recognizes negligent

hiring, training or retention as legitimate bases of recovery

against an employer.... [H]owever, ... in order to impose

liability on an employer for such torts, a plaintiff must first

show that he was injured by the wrongful act of an employee."

Id.

30

Generally, Texas cases have applied negligent hiring or

supervision to instances where the employee's wrongful

conduct—typically assault on a third person—was not within the

scope of his employment, but was nevertheless to some degree job

related. See Dieter v. Baker Service Tools, 739 S.W.2d 405, 408

(Tex.App.—Corpus Christi 1987, writ denied). The doctrine has

also been applied to authorize punitive damages against the

employer, but, again, only in cases where the plaintiff's injury

34

on an employer for the nontortious acts of its employee. We

decline to adopt any such extension of Texas law. Since a

requisite for employer liability under the failure to supervise

theory is that the employee's conduct wrongfully invaded the

plaintiff's rights, to be actionable under the FTCA that element

must be tested under local, not federal, law. Otherwise, the

requirement that the liability be such as would result under local

law is disregarded.

Neither respondeat superior nor negligent supervision

justifies FTCA recovery here absent a determination that issuance

of the press releases violated Johnson's rights under Texas law.

Public Disclosure of Private Facts

The panel majority's second opinion grounded recovery on the

Texas tort of "public disclosure of embarrassing private facts

about the plaintiff," as recognized in Industrial Foundation of the

Industrial Foundation of the South v. Texas Industrial Accident

Board, 540 S.W.2d 668, 682 (Tex.1976). This cause of action

requires the plaintiff to prove (1) that the publicized information

"contains highly intimate or embarrassing facts about a person's

private affairs, such that its publication would be highly

objectionable to a person of ordinary sensibilities," id. at 683;

(2) that such information was "communicated to the public at

large," not simply to "a small group of persons," id.; and (3)

"that the information publicized not be of legitimate concern to

resulted from the employee's tortious conduct. See, e.g., Estate

of Arrington v. Fields, 578 S.W.2d 173, 175-76, 178-79

(Tex.Civ.App.—Tyler 1979, n.r.e.).

35

the public." Id. at 684-85.31 The Texas Supreme Court in

Industrial Foundation further expressly held that this tort did not

extend to publication of facts, no matter how intimate,

embarrassing, or otherwise private, which were a matter of open

public record, stating: "the State may not protect an individual's

privacy interests by recognizing a cause of action in tort for

giving publicity to highly private facts, if those facts are a

matter of public record." Id. at 684. In this connection, as the

Texas Supreme Court noted, id., the United States Supreme Court in

Cox Broadcasting Corporation v. Cohn, 420 U.S. 469, 495, 95 S.Ct.

1029, 1046, 43 L.Ed.2d 328 (1975), held that "the First and

Fourteenth Amendments command nothing less than that the states may

not impose sanctions on the publication of truthful information

contained in official court records open to public inspection."32

Texas clearly has continued to follow the rule that "[o]nce

information is made a part of a public record, there can be no

liability for publicizing it." Gill v. Snow, 644 S.W.2d 222, 224

31

As noted, the district court denied recovery on this

basis, made no finding favorable to Johnson on any of the

necessary elements, and expressly found that Johnson had not

shown that the publicized information was not of legitimate

public concern. Prior to the second panel opinion, Johnson had

made no complaint before this Court as to these aspects of the

district court's decision.

32

See also, e.g., Innovative Database Systems v. Morales,

990 F.2d 217, 221-22 (5th Cir.1993) (Texas law unconstitutional

to the extent it prohibits sale of truthful motor vehicle

accident information obtained from the public records of a law

enforcement agency).

36

(Tex.App.—Ft. Worth 1982, no writ).33

Thus, the proper focus must be on the information contained in

the press releases but not a part of the public record of Johnson's

criminal case. This was correctly identified in the panel

majority's second opinion as follows:

"True, several items contained in the press releases

(Johnson's first and last name, the guilty plea to one count

of tax evasion, the sentence imposed, and the fact that he was

an executive with American National) were part of the trial

record. But several other items contained in those releases

(Johnson's middle initial—he was known as "E.E', his age, his

home address in Galveston, and his official job title with

American National) were neither discussed at his arraignment

[ ] or sentencing [n]or placed in any public record." Johnson

v. Sawyer, 4 F.3d at 381 (footnote omitted).34

33

The panel majority's second opinion appears to suggest

that Cox Broadcasting could be limited to publication by "the

press," though correctly recognizing that Texas interprets that

decision as "extending ... to anyone who publicizes such

information." Johnson v. Sawyer, 4 F.3d at 374. Of course,

Texas law is what is relevant here. Moreover, the language from

Cox Broadcasting above quoted in the text (at n. 32) is not

limited to publication by the press, nor is the rationale of that

opinion. Indeed, Cox Broadcasting relies in part on comment c to

the then tentative draft of Restatement (Second) of Torts § 652D,

stating " "there is no liability for giving publicity to facts

about the plaintiff's life which are matters of public record.' "

Cox Broadcasting, 420 U.S. at 494, 95 S.Ct. at 1045

(incidentally, the quoted language has been incorporated into the

final, approved version of comment b to section 652D). Nothing

in section 652D or its commentary suggests (or suggested) in this

respect a different rule for publication by "the press" as

opposed to publication by others. Nor are we aware of any case

that has so restricted Cox Broadcasting.

34

The panel majority properly did not include in its listing

in this respect the statement in the first press release that

Johnson "was charged in a criminal information with claiming

false business deductions and altering documents involving his

1974 and 1975 income tax returns." (Emphasis added). This

language, which on its face purports only to describe the content

of the criminal information, is not return information under

section 6103(a). While this misdescription of the criminal

information would be actionable under Texas libel law, it is not

actionable under the FTCA, which exempts "[a]ny claim arising out

37

However, none of these items of information—middle initial,

age, street address, job title—can be characterized under Texas law

as "private" and "highly intimate or embarrassing facts about a

person's private affairs, such that its publication would be highly

objectionable to a person of ordinary sensibilities." Industrial

Foundation at 683. Texas invasion of privacy law in this respect

has been guided by Prosser, Law of Torts § 117 (4th ed. 1971) and

Restatement (Second) of Torts, § 652D. See Industrial Foundation

at 682 & n. 21, 684 & n. 22; Gill at 224. Prosser, supra, states

" "[t]he plaintiff cannot complain when an occupation in which he

publicly engages is called to public attention or when publicity is

of ... libel, slander, misrepresentation...." Section 2680(h).

As the district court correctly recognized, "false light"

invasion of privacy essentially amounts to libel, slander, or

misrepresentation. In any event, Texas does not recognize the

tort of false light invasion of privacy. Cain v. Hearst Corp.,

878 S.W.2d 577 (Tex.1994). Finally, there is no finding or

evidence that the inclusion of this matter in the first press

release (it was omitted in the second, corrected release) caused

Johnson to lose his position (or otherwise harmed him).

Likewise, for essentially the same reasons, the panel

majority properly did not include in its listing the

statement in both press releases that "Johnson will be

required to pay back taxes, plus penalties and interest."

To the extent that this might be taken to misdescribe the

penalty judicially imposed on Johnson, it might be

actionable under Texas law as some form of defamation, but

would be exempted from the FTCA (if viewed in this respect

simply as "false light," it would not in any event be

actionable under Texas law). Further, the quoted statement

in substance merely describes the known, universally

applicable legal consequences of willfully and knowingly

filing a false and fraudulent income tax return understating

the tax due by several thousand dollars. See 26 U.S.C. §§

6601 (interest), 6651(a)(3) (penalty), 6653(2) (penalty).

Finally, there is, again, no evidence and no finding that

the inclusion of this information in the press releases had

anything to do with Johnson's loss of position (or otherwise

harmed him).

38

given to matters such as the date of his birth....' " Id. § 117 at

858. An individual "must expect the more or less casual

observation of his neighbors and the passing public as to what he

is and does" and thus there is no liability for publicizing "that

he has returned home from a visit, or gone camping in the woods, or

given a party at his house for his friends." Id. at 857. The

Restatement (Second) of Torts, § 652D, comment b, is to the same

effect, viz: "[t]here is no liability for giving publicity to

facts about the plaintiff's life ... such as the date of his birth

... [or] the fact that he is admitted to the practice of medicine

or is licensed to drive a taxicab ..." and "there is no liability

for giving further publicity to what the plaintiff himself leaves

open to the public eye." Id. at 385, 386. See also Hubert v.

Harte-Hanks Texas Newspapers, Inc., 652 S.W.2d 546, 551

(Tex.App.—Austin 1983, n.r.e.) ("We do not regard the candidates'

names to be facts of a highly embarrassing or intimate nature");

Vandiver v. Star-Telegram, Inc., 756 S.W.2d 103, 106

(Tex.App.—Austin 1988, no writ); Ross v. Midwest Communications,

Inc., 870 F.2d 271, 274 (5th Cir.1989) ("name, residence, or

"identity' are not easily characterized as "private, embarrassing

facts.' "); Tobin v. Michigan Civil Service Comm'n, 416 Mich. 661,

331 N.W.2d 184, 189 (1982) ("Names and addresses are not ordinarily

personal, intimate, or embarrassing pieces of information"). No

Texas (or other) authority to the contrary is cited by the

majority. Moreover, there is no evidence whatsoever that Johnson's

middle initial, his age, his title at American National, and his

39

home address, or any of these, were actually secret or concealed,

or were regarded by him, or would be regarded by the average

person, as private or embarrassing or intimate. To the contrary,

they were obviously matters that Johnson, in the words of the

Restatement, "leaves open to the public eye." As to the middle

initial, its inclusion in the press release is nowhere complained

of in either the FTCA administrative claim or in Johnson's final

complaint. Indeed, in his brief below Johnson asserted that

"Powers agreed that the criminal information and others papers

filed with the Court would identify the Plaintiff as "Elvis E.

Johnson'...."35 Further, the undisputed evidence at trial was that

Johnson was listed in the Galveston telephone directory as "E.E.

Johnson" with address of "25 Adler Circle" (the directory also

separately listed him as "Johnny Johnson," again showing the same

address and the same telephone number). The criminal information

itself disclosed that the defendant "Elvis Johnson" was "a resident

of Galveston, Texas." At the time of the events in issue, the

Johnsons had lived at the Adler Circle address in Galveston for at

least seven years, during all of which time he had worked as an

executive at the American National headquarters, which was in

Galveston, and since 1976 was Senior Executive Vice President

there. Johnson was the number two executive at American National

and reported directly to its board of directors, of which he was

one of the ten or twelve members. Because the company's president

35

Also, in writing the district clerk to set the criminal

case, Johnson's counsel captioned the letter "Re: E.E. Johnson."

40

did not drink, Johnson was in effect its chief entertainer, and

when in Galveston conducted business entertaining almost nightly at

his home there. As a result, he said, "my home was sort of Grand

Central Station" and his wife became "well known" for her role as

hostess on these occasions. Mrs. Johnson described herself as an

unpaid "hostess for the Company" who, with her husband,

"entertained in our home" and "was expected to be at all

entertainment affairs to greet everyone who came in."

Moreover, Johnson testified that American National was a

large, publicly held corporation, operating throughout the country,

that sent annual reports to its shareholders. As such, we

judicially know that the company was required by law to file annual

reports with the Securities and Exchange Commission (SEC) that

disclosed the name, age, and all positions and offices with the

company held by each director and executive officer.36 Further, in

36

17 C.F.R. § 240.13a-1 requires of publicly held

corporations the filing each year with the SEC of "an annual

report on the appropriate form authorized or prescribed

therefor." The form prescribed for this purpose is the SEC Form

10-K. See Ratner & Hazen, Securities Regulation, Selected

Statutes, Rules, and Forms (West 1993) at 912-22. Item 10 of the

form requires the same information concerning "Directors and

Executive Officers" as is "required by Item 401 of Regulation S-

K." Id. at 920. Item 401 of Regulation S-K requires, among

other things, the listing of "the names and ages of all

directors" and "of all executive officers" of the company, with

"all positions and offices with" the company "held by each such

person." 17 C.F.R. § 229.401(a) & (b). Item 401 also provides

in part as follows:

"(f) Involvement in certain legal proceedings.

Describe any of the following events that occurred

during the past five years and that are material to an

evaluation of the ability or integrity of any director,

person nominated to become a director or executive

officer of the registrant;

41

open court in the criminal case, Johnson was described as "an

executive for the American National Insurance Company."

We reject the theory advanced in the second panel majority

opinion, Johnson v. Sawyer, 4 F.3d at 387 & n. 87, that although

the disclosed nonpublic record information—middle initial, age,

street address, and executive job title—was not itself "private" in

the relevant sense, nevertheless it became so because it would aid

the public in identifying Johnson, the executive vice president of

American National, as being the same person as the Elvis Johnson,

an executive with American National residing in Galveston, who was

recently convicted of felony tax evasion in the federal court in

Galveston. But this enhanced ease of public identification does

....

(2) Such person was convicted in a criminal

proceeding or is a named subject of a pending criminal

proceeding (excluding traffic violations and other

minor offenses); ..." 17 C.F.R. § 229.401(f).

The same requirements are all applicable to proxy

statements, and these too must be filed with the SEC. 17

C.F.R. §§ 240.14a-3(a); 240.-14a-6; 240.14a-101, Item

7(b). Shareholders must receive proxy statements and annual

reports at the same time each year. 17 C.F.R. § 240.14a-

3(b).

We, of course, take judicial notice of federal

regulations. See, e.g., McCormick on Evidence § 335 at 939

(3d ed. 1984).

Similarly, Texas law required (and requires) corporate

franchise tax reports to disclose at least annually "the

name, title, and mailing address of each director and

officer of the corporation" "which the Comptroller of Public

Accounts shall forward to the Secretary of State to be

available for public inspection." See former V.A.T.C.S.,

Title 122A, Taxation-General, Art. 12.12 (now contained in

Texas Tax Code §§ 171.203(a)(3) & (c) and 171.207(2)).

42

not make the middle initial, street address, or the like "private"

information; to the contrary, it emphasizes the nonprivate nature

of that information. Of course, the publication of nonprivate

information—e.g., a person's name or other identifying public facts

about him—can invade the subject's privacy where it publicly ties

that individual to some private occurrence that is intimate or

embarrassing; for example, publicizing that the person who is

having the previously secret affair with Mrs. X is the man named

Mr. Y who lives at such and such an address. Here, however, the

nonprivate identifying information—middle initial, street address,

etc.—ties the subject only to what is properly public (his recent

conviction in open court for felony tax evasion). Further, Johnson

was not convicted under a pseudonym or concealed identity, but

rather in open court—as required by the Constitution—under his own

name (Elvis Johnson) pursuant to public proceedings that identified

him as a Galveston resident employed as an American National

executive having taxable income of $59,784.18 in 1975.37 We

likewise reject the argument that section 6103 makes any

information disclosed in violation thereof private, intimate, and

embarrassing as a matter of law, and that Texas courts would

therefore hold that whoever publicizes any information contrary to

section 6103 commits the Texas tort of invasion of privacy.

37

We recognize that occasionally statutes provide for the

use in certain criminal proceedings of a victim's pseudonym.

See, e.g., TEX.CODE CRIM.PROC. art. 57.02. We are aware, however,

of no comparable statute, state or federal, authorizing a felony

defendant's use of a pseudonym in the criminal proceedings

against him. And, certainly, Johnson did not use one.

43

There are several things wrong with this. To begin with,

section 6103 does not say that whatever is in a tax return is

always private, intimate, and embarrassing. A tax return typically

shows the taxpayer's name, occupation, employer, and address. The

facts that Ronald Reagan was President of the United States and

lived at the White House are not made private, intimate, and

embarrassing by section 6103.38 Obviously, this is not what section

6103 is concerned with. Section 6103 is a regulation of the

conduct of those who in the course of their duties as government

employees or contractors glean information from tax returns. The

regulation is prophylactic, proscribing disclosure by such an

individual of any of such information so obtained by him. Plainly,

Congress was not determining that all the information on a tax

38

Similarly, we of course recognize that private information

does not become public merely because it is included in an

official record which is not open to public inspection. Thus,

Restatement (Second) of Torts § 652D comment b states that "[i]f

a record is one not open to public inspection, as in the case of

income tax returns, it is not public, and there is an invasion of

privacy when it is made so." However, this obviously does not

mean that whatever appears on an individual's income tax return

is therefore necessarily "private" information about him

protected by the invasion of privacy tort. What the quoted

language does mean is that information that is otherwise

"private" in the relevant sense does not lose its character as

such by appearing on an official governmental record that is not

open to public inspection, although it would lose its character

as "private" if the record were open to public inspection. See

id. comment d. Certainly Texas law follows this common sense

approach, as the Texas Supreme Court clearly held in Industrial

Foundation that information on a governmental record not open to

public inspection could be partially non-"private"—such as the

name of the person filing and the general nature of the form—and

partially "private." Id. at 686 (but if the government record is

open to public inspection, then giving publicity to any of it is

not tortious no matter how "private" what is publicized may

otherwise be. Id. at 684).

44

return would always be truly private and intimate or embarrassing.

Rather, it was simply determining that since much of the

information on tax returns does fall within that category, it was

better to proscribe disclosure of all return information, rather

than rely on ad hoc determinations by those with official access to

returns as to whether particular items were or were not private,

intimate, or embarrassing. Because such determinations would

inevitably sometimes err, ultimately a broad prophylactic

proscription would result in less disclosure by return handlers of

such sensitive matters than would a more precisely tailored

enactment.39

39

These comments are similarly applicable to the then in

force V.A.T.C.S., Title 122A, Taxation-General, art. 1.035 §§ 1 &

2 (now replaced by Texas Tax Code §§ 111.006 & 111.007) providing

that federal tax returns (and federal tax return information)

required to be filed with a state tax return filed with the Texas

Comptroller of Public Accounts is confidential, and prohibiting

disclosure thereof by any "official, employee, or former official

or employee of the comptroller of public accounts." We also note

that art. 1.035 in this respect was obviously responsive to

section 6103(p)(8), which prohibits disclosure of return

information to state authorities which require the state tax

return to have attached a copy of the federal return, unless the

state adopts laws protecting the confidentiality of the federal

return copy attached to the state return. Also then in force was

V.A.T.C.S., Title 122A, Taxation-General, art. 12.10A (now

replaced by Texas Tax Code § 171.208), which proscribed

disclosure by those "having access to any franchise tax report

filed as provided by law" of "the amount or source of income,

profits, losses, expenditures, or any particulars thereof, or any

other information pertaining to the financial condition of the

corporation set forth or disclosed in such report." None of

these Texas statutes are (or were) applicable to personal tax

returns, and none proscribed disclosure of the information

acquired from other sources, or purported to make confidential

such matters as the name, age (or date of incorporation),

address, or type of business engaged in by the taxpayer, or the

names, addresses, or titles of its officers and directors (which

were required to be of public record, see n. 36, supra ), or

whether or not the taxpayer (or any of its officers or directors)

45

Unlike section 6103(a), the Texas tort of "[p]ublic disclosure

of embarrassing private facts about" another, Industrial Foundation

at 682, is not concerned with the identity of the party making the

disclosure, or his sources, but merely with whether the information

disclosed is both private and intimate or embarrassing, and also

not of public concern, none of which factors are relevant under the

terms of section 6103(a). The Texas tort and section 6103(a)

address totally distinct subject matters and impose distinctly

different duties: the latter, applicable only to certain

individuals who in connection with their government-related duties

obtain tax return information, enjoins them not to disclose any of

it so obtained, even though it is not private and not intimate or

embarrassing and is of public concern; the former, applicable to

all persons and regardless of the source of the information,

proscribes publication thereof only if the matter is private and is

intimate or embarrassing and is not of public concern.

In these circumstances, to say that section 6103 makes the

information private for purposes of the Texas tort when it would

not otherwise be so is simply another way of allowing recovery for

the violation of section 6103(a)(1) itself, contrary to our noted

holding in Tindall that "a federal regulation cannot establish a

duty owed to the plaintiff under state law."40

had been convicted of a criminal offense.

40

Nor have we been cited to any case in which intrinsically

nonprivate information—such as name, age, address, and

occupation—has been held "private" and "embarrassing" for

purposes of the tort of disclosure of "embarrassing private facts

about" another merely because it was disclosed contrary to a

46

Thus, the facts not previously disclosed in public in

connection with the criminal case—Johnson's middle initial, age,

street address, and executive title—were not "private" or "highly

intimate and embarrassing" as required for the first element of the

Texas tort of public disclosure of embarrassing private facts.

While publication of these facts may have made it easier for the

public to identify the "Elvis Johnson, a resident of Galveston,

Texas," an American National executive, who was recently convicted

by the federal court in Galveston, as the E.E. Johnson who was the

senior executive vice president of American National, this would

not disclose any private fact—Johnson having appeared in open court

under his own name41—and Texas does not recognize a privacy cause

of action for giving publicity to even highly private facts that

are a matter of public record.

Moreover, we sustain the district court's determination that

Johnson had not demonstrated that his conviction was not of

statute providing certain official information would not be

disclosed. Such might be the result if the information so

disclosed identified some truly private and embarrassing fact

about the plaintiff; but not where what is thus revealed and

embarrassing is a fact of public record, here a recent, local

felony conviction in open court. As previously observed (see n.

38, supra ), the Texas common law recognizes that the mere fact

that information appears in an official nonpublic record does not

preclude its being private and intimate or embarrassing and not

of public concern; but it does not make it so. Industrial

Foundation at 686.

41

Thus, in Cox Broadcasting, the Supreme Court quoted with

approval from Craig v. Harney, 331 U.S. 367, 374, 67 S.Ct. 1249,

1254, 91 L.Ed. 1546 (1947), in part as follows: " "A trial is a

public event. What transpires in the courtroom is public

property.' " Cox Broadcasting 420 U.S. at 492, 95 S.Ct. at 1045.

47

legitimate concern to the public, and thus failed to establish the

third element of the Texas tort.42 The conviction was for a felony,

carrying a penalty of up to five years' imprisonment, and requiring

proof of specific criminal intent. See n. 13, supra. As the Texas

Supreme Court recently held, after an exhaustive review of

decisions throughout the nation, "[t]he weight of reason and

authority lead us to the conclusion that a violation of 26 U.S.C.

§ 7201 involves moral turpitude per se." Matter of Humphreys, 880

S.W.2d 402, 408 (Tex.1994). In Cox Broadcasting, the Court said

"[t]he commission of crime, prosecutions resulting from it, and

judicial proceedings arising from the prosecutions, however, are

without question events of legitimate concern to the public ...."

Id. 420 U.S. at 492, 95 S.Ct. at 1045 (emphasis added). On this

basis alone, it is evident that Johnson's recent conviction was

"without question" a matter "of legitimate concern to the public."

Further, SEC regulations required (and require) that there be

publicly reported annually as to each executive officer and

director of a publicly held company such as American National not

only such person's name and age and the positions and offices with

the company held by such person, but also any criminal conviction

(excluding traffic violations and other minor offenses) within the

past five years if such conviction is "material to an evaluation of

42

See Industrial Foundation at 684-85: "The last

requirement for an actionable invasion of privacy is that the

information publicized not be of legitimate concern to the

public."

48

the ability or integrity" of that person.43 The law has long

considered conviction of any felony as material to an evaluation of

the integrity of the person so convicted. See, e.g., Green v. Beck

Laundry Machine Co., 490 U.S. 504, 521-26, 109 S.Ct. 1981, 1991-93,

104 L.Ed.2d 557 (1989) (witness veracity). Indeed, an offense,

such as a violation of section 7201, which is held to be one of

"moral turpitude per se," Matter of Humphreys, would necessarily be

material to an evaluation of the convicted person's integrity.44

43

See n. 36, supra. All such information must also be

included in the proxy statements which must accompany the annual

reports sent the shareholders. Id.

44

See also TEX.INS.CODE ANN. art. 21.07-3, § 12(f) (conviction

of any felony grounds for revocation of license of managing

general agent; while Johnson may not have been a managing

general agent, it is undisputed that a major portion of his

duties consisted of performing functions very similar to those of

a managing general agent as defined in TEX.INS.CODE ANN. art.

21.07-3 § 2(a)).

The district court's determination that Johnson's

conviction was not a matter "that a reasonable investor

would consider ... important in deciding whether to invest,"

760 F.Supp. at 1230, is not controlling as to whether

Johnson's conviction would have to be included in the annual

report to the SEC and in the proxy statement. To begin

with, the test under the regulations is not the conviction's

materiality to the investment decision, but is rather its

materiality "to an evaluation of the ... integrity of" the

person convicted. Further, the district court based its

conclusion on the assumption that the investor would know

that Johnson was in fact not guilty of a section 7201

violation. 760 F.Supp. at 1220, 1221, 1230 (indeed, at

trial the court observed that "what Mr. Johnson did here

was, in effect, like getting a speeding ticket"). This

approach, however, is wide of the mark, for the question is

not whether what Johnson did, or says he did, is material,

but rather whether his "conviction" (or what he was

convicted of) is material (to an evaluation of his

integrity). Further, as previously noted, Johnson is

estopped to challenge his guilt of the section 7201 offense

as alleged in the information. See n. 13, supra.

49

Accordingly, it is clear that Johnson's conviction—as well as his

name, age, and positions with American National—was a matter of

legitimate concern to the public.45

We accordingly affirm the district court's determination that

Johnson has not made out a case under the Texas tort of public

disclosure of embarrassing private facts about the plaintiff. The

disclosure was of information either of public record or otherwise

neither private nor highly intimate or embarrassing, and the

information was also of legitimate concern to the public.

Conclusion

This FTCA action has always been grounded on asserted

violations of section 6103(a)(1) by IRS employees in the scope of

their employment.46 However, the FTCA requires that the duty

45

Moreover, that Johnson's felony conviction is a matter of

legitimate public concern likewise renders nonintimate

information tending to identify him as the person so

convicted—such as his name, age, residence, job title—likewise of

legitimate public concern. The two are really inseparable. Cf.

Ross v. Midwest Communications, Inc., 870 F.2d 271, 274 (5th

Cir.1989).

46

Because Johnson has never complained of any disclosure

assertedly in violation of section 6103(a) that disclosed matters

of open public record, we need not and do not determine whether

to follow the rule of Lampert v. United States, 854 F.2d 335, 338

(9th Cir.1988), cert. denied, 490 U.S. 1034, 109 S.Ct. 1931, 104

L.Ed.2d 403 (1989), that section 6103(a) does not bar disclosure

of matters of public record. We observe, however, that such a

bar, at least as to recent federal felony convictions, would

appear in some tension with Cox Broadcasting. See also

Innovative Database Systems v. Morales; United States v.

Wallington, 889 F.2d 573, 576 (5th Cir.1989) (construing

narrowly, to avoid First Amendment concerns, nondisclosure

provisions of 18 U.S.C. § 1905). Nor do we decide what breadth

Lampert should have, were we to adopt it.

Further, we assume, arguendo only, that there is

sufficient evidence that the press releases, or the

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breached by the government employees be not simply one imposed by

federal statute or regulation, but rather arise under state law.

This requirement for a breach of state law duty is not met simply

by invoking general state law principles of respondeat superior or

failure to supervise. Nor may the requirement be fulfilled by

simply invoking the state's general negligence per se doctrine.

That is particularly so in the present setting where there is

nothing to indicate that the state would invoke that doctrine to

create a common law cause of action for violation of section

6103(a)(1) where there was already a comprehensive federal

statutory cause of action therefore, here section 7217. Finally,

while Johnson may have stated a state law claim for defamation,

that is exempted from the FTCA. To the extent, if any, not so

exempted, "false light" is not recognized in Texas. The district

court correctly denied recovery on these claims, as well as on

Johnson's claim for breach of fiduciary duty.47 Johnson's core

assertion of a Texas law duty is that, established in Industrial

Foundation, not to publicly disclose embarrassing private facts

about another. We hold that the district court correctly denied

recovery in this respect. Johnson has not made out a case on this

basis. The facts disclosed were not private and were of legitimate

challenged matters therein that may have enhanced the

public's ability to identify Johnson, were a cause of his

complained of loss of position.

47

As to the latter, we are in general agreement with the

district court's analysis. 760 F.Supp. at 1232-33. It is

evident that Johnson and the IRS knowingly stood in an

adversarial relationship, one to the other, and that Johnson

looked to his lawyer, not to the IRS or Powers, for advice.

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public concern.

For the reasons stated, the judgment of the district court is

REVERSED and the cause is REMANDED with directions that Johnson's

FTCA claim be DISMISSED.

WIENER, Circuit Judge, dissenting, joined by JOHNSON, Circuit

Judge.

My usual temerity—and Judge Johnson's—in dissenting from any

of Judge Garwood's opinions is heightened in this instance by the

awareness of the landslide concurring vote that his opinion was

given by our colleagues on the en banc court. But as the erstwhile

panel majority, Judge Johnson and I remain convinced that Mr. E.E.

Johnson was entitled to recover under the FTCA. Having killed so

many trees, however, through publication of our original panel

majority opinion (first opinion)1 and our supplemental and amending

panel opinion (second opinion),2 we shall refrain from

regurgitating ad nauseam the pertinent facts and the law as we see

it. Rather, we reiterate and adopt by reference the factual and

legal positions we espoused in our second opinion.

Our unwavering belief continues to be that the district court

correctly concluded, albeit for the wrong reasons, that Mr. Johnson

did have a valid cause of action under the FTCA. The basis for the

district court's judgment, which we erroneously adopted in our

first opinion, was that the requisite state law cause of action

(and thus the "duty" owed) for Johnson's FTCA claim was supplied by

1

Johnson v. Sawyer, 980 F.2d 1490 (5th Cir.1992).

2

Johnson v. Sawyer, 4 F.3d 369 (5th Cir.1993).

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§ 6103, a federal statute. We did our best in our second opinion,

however, to correct our mistake, first by expressly disavowing our

earlier pronouncement and then by affirming the district court for

reasons which were and remain valid under the FTCA: The state

cause of action required for a valid FTCA claim is here supplied by

one of Texas's recognized invasion-of-privacy torts—usually

denominated "public disclosure of embarrassing facts"—as well as by

negligence per se. We tried carefully to distinguish the duty owed

from the standard of care required in the performance of that duty.

In this dichotomy, the prerequisite state tort created the duty and

thus the cause of action for a breach thereof; the federal

statute—§ 6103—merely supplied the standard of care for determining

whether the duty was breached.

Regrettably, the en banc majority opinion from which we

dissent today turns a blind eye to this dichotomy when it states,

in its opening paragraph, that the panel majority "ultimately

grounds the duty not to disclose on federal law." By thus

misreading or mischaracterizing the principal thrust of our second

opinion, the en banc majority opinion essentially ignores the

duty/standard of care analysis of our second opinion.

Consequently, the en banc majority opinion wrongly concentrates its

efforts on rejecting our first opinion's admittedly erroneous

contention that § 6103 was the source of the duty owed to Mr.

Johnson rather than the measure of the standard of care for a

performance or breach of a state law duty. But we already rejected

that theory when we filed the second opinion! Because our

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colleagues who have concurred in the en banc majority opinion seem

nevertheless to have swallowed its legal legerdemain hook, line and

sinker, there is nothing left for us to say except "Please—go back

and re-read our second opinion!"

We believe that the propriety of this entreaty is confirmed by

the quantity of ink devoted in the en banc majority opinion to

justifying its conclusion that those facts included in the press

release that were return information but were not public record3

were somehow not the kind of private facts that are actionable

under the state tort that we, in our second opinion, insisted did

establish the state law duty and thus the predicate state law cause

of action for FTCA purposes. If we had indeed merely continued to

hold that Johnson's FTCA cause of action was grounded in § 6103,

would the en banc majority have felt so strongly compelled thus to

explain away the Texas statutory tort by characterizing the

non-public record, return facts as not embarrassing? "The lady

doth protest too much, me thinks."4

Reduced to its barest essentials, our position was and remains

that a private citizen has a duty under the Texas tort law not to

do what the IRS agents, particularly Special Agent Stone, did here.

Consequently, the FTCA is available to those like Johnson to whom

such a duty is owed. Our second opinion demonstrates the

3

Remember, the record of the plea and sentencing hearing was

not even transcribed and filed until more than three months after

the damaging news releases were disseminated and published, and

well after Mr. Johnson was demoted and removed from the company's

Board of Directors.

4

Shakespeare, Hamlet III, ii, 242.

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availability of that Texas tort to serve as the state law basis for

Johnson's FTCA claim.

Only after successfully completing the search for a state law

cause of action do we look to the federal statute—§ 6103—and then

only as the source of an applicable yardstick, the standard of care

against which to test the federal agents' actions that so

undeniably damaged Mr. Johnson. In this second inquiry there can

be no serious dispute that Texas courts examining the actions of

private citizens accused of breaching a state law duty can and

frequently do use the provisions of statutes—not just state or

local but federal as well—as standard-of-care yardsticks. Given

the state law duty and the statutory standard of care, Mr.

Johnson's right to seek recovery under the FTCA is unassailable.

I respectfully dissent.

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