Petition for Writ of Certiorari — McDaniel v. Tellis

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Supreme Court of the United States

OCTOBER TERM, 1993

ELDON K. McDANIEL, DARLENE MOORE, KARL

SANNICKS, and ROBERT HUME,

Petitioners,

Vv.

LESTER TELLIS,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO THE

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

FRANKIE SUE DEL PAPA

Attorney General of the

State of Nevada

BROOKE A. NIELSEN

Assistant Attorney General

THOMAS J. RAY

Solicitor General

ANNE B. CATHCART*

Senior Deputy Attorney General

Litigation Division

Capitol Complex

Carson City, Nevada 89710

Telephone: (702) 687-4170

Counsel for Petitioners

*Attorney of Record

QUESTIONS PRESENTED

I. WHETHER NEVADA REVISED STATUTE §

209.241 CREATES A LIBERTY OR PROPERTY

INTEREST FOR EACH INMATE IN THE INTEREST

ACTUALLY EARNED ON MONEY DEPOSITED IN THE

PRISONERS’ PERSONAL PROPERTY FUND.

Il. WHETHER THE COURT OF APPEALS ERRED

IN ITS INTERPRETATION OF "PRISONERS’

PERSONAL PROPERTY FUND" BY FINDING THE

STATUTE CREATED A PROTECTED PROPERTY

INTEREST.

TOPICAL INDEX

Page

QUESTIONS PRESENTED i

TABLE OF AUTHORITIES iv

OPINIONS AND JUDGMENTS BELOW 2

JURISDICTIONAL STATEMENT 3

STATUTORY AND CONSTITUTIONAL

PROVISIONS INVOLVED 6

STATEMENT OF THE CASE 7

I. Whether Nevada Revised Statute

209.241 Creates a Liberty or

Property Interest For Each Inmate

in the Interest Actually Earned on

Money Deposited in the Prisoner's

Personal Property Fund 10

II. Whether the Ninth Circuit Erred

in its Interpretation of

"Prisoners’ Personal Property Fund"

by Finding the Statute Created a

Protected Property Interest

SUMMARY OF THE ARGUMENT

a The Syntax of the Statutes

Plainly Refers to the

Prisoners’ Fund, a Single

Fund Established for the

Benefit of Prisoners as a

Collective Unit

The Legislature has

Acquiesced in the Department

of Prisons’ Interpretation

of the Statute

TOP mnt.

Page

a The Impact on The Prison

System of Paying Interest on

Individual Inmate Trust

Accounts Would be Burdensome

and Costly 25

4. The Ninth Circuit Court

Should Have Abstained from

Interpreting the State

Statute Adverse to the

State’s Interests and

Certified the Question to

the Nevada State Supreme

Court 30

Sa]

There is No Constitutional

Right of Inmates to Interest

Earned on Inmate Trust

Accounts 35

CONCLUSION 43

APPENDIX A (District Court Order -

January 30, 1991) A-1l

APPENDIX B (District Court Judgment

April 2, 1991 B-1

APPENDIX C (District Court Order

August 8, 1991) C-1

APPENDIX D (Ninth Circuit Opinion

September 28, 1993) D-1

APPENDIX E (Ninth Circuit Order -

February 22, 1994)

(1)

CASES

Almodovar v.

TABLE OF AUTHORITIES

832 F.2d 1138

Alper v.

96 Nev. 925,

State ex rel.

621 P.2d 492

Baumann v.

Arizona Dept.

754 F.2d 841

Bell v.

441 U.S. 520

Bellotti v.

428 U.S. 132

Bing Const. Co.

Nevada Dept.

109 Nev. 275,

Breen v.

102 Nev. 79,

Caesars

Reiner

(9th Cir.

1987)

of Corrections

(9th Cir.

Wolfish

(1979)

Baird

(1976)

849 P.2d

Palace

715 P.2d 1070

C.Y. Development Co. v.

City of Redlands

703 F.2d 375

Cragun v. Nevada

Pub. Employees’ Ret. Bd.

92 Nev. 202,

Foster

979

Gentry

685

Hansen

947

Vv.

(9th Cir.

547 P.2d 1356

Hughes

.24°130 (6th Cir.

MacDougall

.2d 322 (9th Cir.

White

.2@ i378 (Sth tir.

1985)

of Nevada v.

of Taxation

302 (1993)

1983)

1992)

1982)

1991)

(1986)

(1976)

Dep’t of Hwys.

(1980)

32,

39;

18,

TABLE OF AUTHORITIES Cont.

CASES Page

Harrison v. NAACP

360 U.S. 167 (1959) 32

Hendrix v. Evans

715 F. Supp. 897 (N.D.Ind. 1989) 41,

Hewitt v. Helms

459 U.S. 460 (1983) 15

Hoptowit v. Ray

682 F.2d 1237 (9th Cir. 1982) 38

Hotel Employees and Restaurant

Employees Int’l Union v. State ex

rel. Nevada Gaming Control Bd.

103 Nev. 588, 747 P.2d 878 (1987) 21

Hughes Properties v. State of Nevada

100 Nev. 295, 680 P.2d 970 (1984) 18

Jones v. North Carolina

Prisoners’ Labor Union, Inc.

433 U.S. 119 (1977) 39

Kentucky Dept. of Corrections v.

Thompson

490 U.S. 454 (1989) 45, 35

Las Vegas Sun v. District Court

104 Nev. 508, 761 P.2d 849 (1988) 22

Lehman Brothers v. Schein

416 U.S. 386 (1974) 34

Meachum v. Fano

427 U.S. 215 (1976) 35

Michenfelder v. Sumner

860 F.2d 328 (9th Cir. 1988) 38

TABLE OF AUTHORITIES Cont.

CASES Page

Nevada Tax Comm’n. v. Bernhard

100 Nev. 348, 683 P.2d 21 (1984) 22

NL Industries v.

Eisenman Chemical Co.

98 Nev. 253, 645 P.2d 976 (1982) 24

O’Lone v. Estate of Shabazz

482 U.S. 342 (1987) 39

Pell v. Procunier

417 U.S. 817 (1974) 37

Procunier v. Martinez

416 U.S. 396 (1974) 36, 37

Railroad Commission of Texas v.

Pullman

312 U.S. 496 (1941) 31

Robert E. v. Justice Court

99 Nev. 443, 664 P.2d 957 (1983) 22

Sheriff v. Smith

91 Nev. 729, 542 P.2d 440 (1975) 23

SIIS v. Jesch

101 Nev. 690, 709 P.2d 172 (1985) 23

State ex rel. Tax Comm’n v.

Safeway

99 Nev. 626, 668 P.2d 291 (1983) 18

State v. Webster

102 Nev. 450, 726 P.2d 831 (1986) 22

Summa Corp. v.

State Gaming Control Board

98 Nev. 390, 649 P.2d 1363 (1982) 18

CASES

Thomas v. State

88 Nev. 382, 498 P.2d 1314 (1972)

Turner v. Safley

482 U.S. 76,

107 S.Ct. 2254 (1987) 25,

United States v.

Thirty-Seven Photographs

402 U.S. 363 (1971)

Waldron v. McAtee

723 F.2d 1348 (7th Cir. 1983)

Washington v. Harper

494 U.S. 210 (1990)

Williams v. Sumner

648 F. Supp. 510 (D.Nev. 1986)

OTHER AUTHORITY CITED

Nevada Revised Statute 209.221

Nevada Revised Statute 209.231

Nevada Revised Statute 209.241 2.

aoe

16, 19-2

aes “ek

Nevada Revised Statute 356.087

United States Code

Section 1254(1) of Title 28

vil

Page

39, 40

6, 8,

| oe *

L, 26,

42, 43

33, 2A

No.

IN THE

SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1993

ELDON K. MCDANIEL, DARLENE MOORE,

KARL SANNICKS, AND ROBERT HUME,’

Petitioners,

Vv.

LESTER TELLIS,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

"The named petitioners have succeeded

S. Godinez and Ron Angelone, respondents-

appellees below, in office. The named

petitioners are substituted as parties to

this action in accordance with Supreme

Court Rule 35(3).

IN THE

SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1993

ELDON K. MCDANIEL, DARLENE MOORE,

KARL SANNICKS, AND ROBERT HUME, *

Petitioners,

Vv.

LESTER TELLIS,

Respondent.

PETITION FOR A WRIT OF CERTIORARI TO

THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

TO THE HONORABLE JUSTICES OF THE SUPREME

COURT :

COME NOW ELDON K. MCDANIEL, DARLENE

MOORE, KARL SANNICKS, ROBERT HUME!, and

‘Petitioner McDaniel, successor in

office to S. Godinez; Petitioner

Sannicks, successor in office to Ron

Angelone, have been substituted as

parties. See Sup. Ct. R. 35(3). Lester

Tellis, respondent in this Court, and

petitioner-appellant below, will be

referred to as Tellis.

Frankie Sue Del Papa, the Attorney

General of the State of Nevada, and file

this petition for writ of certiorari

seeking to vacate the Order, on Remand,

of the Ninth Circuit Court of Appeals.

OPINIONS AND JUDGMENTS BELOW

The Order of the United States

District Court, District of Nevada,

directing both parties to rebrief certain

issues, was entered on January 30, 1991.

This order is reproduced in Appendix A.

The Judgment of the United States

District Court, District of Nevada, which

granted the defendants’ Cross-Motion for

Summary Judgment, was entered on April 2,

1991. This Judgment is reproduced in

Appendix B.

The Order of the United States

District Court, District of Nevada, which

denied the plaintiff’s Motion for

Additional Findings of Fact and to amend

accordingly and Plaintiff’s Motion for

Partial Summary Judgment was entered on

August 8, 1991. This Order is reproduced

in Appendix Cc.

The Opinion from the Ninth Circuit

Court of Appeals, which reversed the

decision of the United State District

Court, District of Nevada, was filed

September 28, 1993. This Opinion is

reproduced in Appendix D.

The Order from the Ninth Circuit Court

of Appeals, which denied the defendants’

Petition for Rehearing, was filed on

February 22, 1994. This Order is

reproduced in Appendix E.

JURISDICTIONAL STATEMENT

This case arises from a Civil rights

action filed on July 29, 1990, in the

federal district court by Lester Tellis,

an inmate incarcerated in the Nevada

Department of Prisons. The complaint

alleged violations of his First, Fourth,

Fifth, Sixth, Ninth and Fourteenth

Amendment Rights.

Defendants filed an Answer on

September 24, 1990.

Plaintiff filed a Motion for Partial

Summary Judgment on November 21, 1990.

Defendants’ Opposition to Plaintiff’s

Motion for Partial Summary Judgment and a

Cross-Motion for Summary Judgment and

Plaintiff’s Reply were filed on November

a3, i93¢.

The United States District Court,

District of Nevada, entered an Order on

January 30, 1991 directing both parties

to rebrief certain issues.

Defendants filed a Supplemental Brief

in Aid of Cross-Motion For Summary

Judgment on March 25, 1991.

The United States District Court,

District of Nevada entered Judgment

granting the Defendants’ Cross-Motion for

Summary Judgment on April 2, 1991.

Plaintiff filed his Reply to

Defendant’s Supplemental Brief in Aid of

Cross-Motion for Summary Judgment on

April 10, 1991.

Plaintiff filed a Motion for

Additional Findings of Fact on April 18,

1991.

Defendants filed an Opposition to

Motion for Additional Findings of Fact on

May 13, 1991.

The United States District Court

District of Nevada entered an Order

denying Plaintiff’s Motion for Additional

Findings of Fact and Plaintiff’s Motion

for Partial Summary Judgment.

Plaintiff filed his Informal Brief

appealing the Order of the United States

District Court on October Bey 299%.

Defendants filed an Answering Brief on

February 3, 1992.

The United States Court of Appeals for

the Ninth Circuit filed its decision

reversing the District Court’s decision

on September 28, 1993.

Defendants filed a Petition for

Rehearing and Suggestion for Rehearing En

Banc on October 12, 1993.

The United States Court of Appeals for

the Ninth Circuit filed an Order denying

the Petition for Rehearing and rejecting

the Suggestion for Rehearing En Banc on

February 22, 1994. (Judge Farris on the

three-judge panel would have granted the

petition.) The jurisdiction of this

Court is invoked under section 1254(1) of

Title 28 to the United States Code.

STATUTORY AND CONSTITUTIONAL

PROVISIONS INVOLVED

The following statutory and Consti-

tutional provisions are involved in this

case:

Nevada Revised Statute § 209.241.

The Fourteenth Amendment to the United

States Constitution.

STATEMENT OF THE CASE

Respondent Lester Tellis, an inmate at

Ely State Prison, filed a civil rights

complaint on July 29, 1990 alleging a

denial of his First, Fourth, Fifth,

Sixth, Ninth and Fourteenth Amendment

rights under the U.S. Constitution. His

allegations stemmed from not receiving

interest on his inmate account. Tellis

requested both damages and injunctive

relief.

The issue presentec by Tellis was

whether an inmate had a constitutional

right to interest earned on what he

termed his "prisoner’s personal property

fund."

The United States District Court,

District of Nevada after requesting

rebriefing by the parties, entered an

order on January 30, 1991 granting

Defendants’ Motion for Summary Judgment.

The Order stated:

The Fourteenth Amendment to the

United States Constitution states,

in relevant part, no state may

"deprive any person of life,

liberty or property, without due

process of law. This right to due

process only attaches when a person

is deprived of an interest

independently recognized as

"protected" under state, federal,

or constitutional law, Olim v.

Wakinekona, 461 U.S. 238 (1983).

Tellis does allege that the state

is depositing the interest earned

on his money into the prisoners

personal property fund generally,

rather than into his own account.

The defendants do not dispute this

and cite Nevada Revised Statutes §

209.241 as authority for this

procedure.

Nev. Rev. Stat. 209.241 provides, in

pertinent part:

1. The director may accept

money, inciuding the net amount of

any wages earned during the

incarceration of an offender after

any deductions made by the

director, and valuables belonging

to an offender at the time of his

incarceration or afterward received

by gift, inheritance or the like,

or earned during the incarceration

of the offender and shall deposit

the money in the prisoners’

personal property fund, which is

hereby created as a trust fund.

2. The director:

(a) Shall keep or cause to be

kept, a full and accurate account

of the money and valuables, and

shall submit reports to the board

relating to the money and valuables

as may be required from time to

time.

(b) May permit withdrawals for

immediate expenditure by an

offender for personal needs.

offender upon his release any

remaining balance in his individual

account.

3. The interest and income

earned on the money in the fund,

after deducting any applicable

charges must be credited to the

fund. [Emphasis added.]

The District Court in its order

Stated: "The question presented here is

whether the words "the fund" in sub-

section 3 of this statute (which has not

been interpreted by the Nevada courts)

refer to a prisoner’s individual account

within the prisoners’ personal property

fund, or to the fund as a whole."

The District Court entered Judgment on

April 24, 1991, granting the Defendant’s

Cross-motion for Summary Judgment,

holding that Tellis did not have a

constitutional right to interest earned

on his individual account and that the

"fund" refers to the prisoners’ personal

property fund as a whole.

The Ninth Circuit Court of Appeal

reversed the District Court, stating that

the mandatory language of Nevada Revised

Statute 209.241 creates a protected

property interest in the interest on each

inmate account. Defendants filed a

Petition for Rehearing and Suggestion for

Rehearing En Banc on October 12, 1993,

which was denied by an order filed

February 22, 1994 by the Ninth Circuit.

The issues on appeal are:

Two of the three judges on the Ninth

Circuit’s three judge panel

misinterpreted Nevada Revised Statute

209.241 in finding that the phrase

"prisoners’ personal property fund"

created a protected property interest for

each inmate in his individual inmate

account. The Court erred by failing to

discern syntax, the impact on the prison

System, and legislative intent and

acquiescence. The Ninth Circuit should

have certified the question of

interpretation of a state statute to the

Nevada State Supreme Court. Finally, the

case law is clear there is no

constitutional right of inmates to

interest from inmate trust funds.

1. Th n f P

Refer he Pri : n in

Fund ish for Benefi f

Prisoner a iv ni

As a fundamental point, the syntax of

the term prisoners’ personal property

fund must be addressed. The difficulty

the Ninth Circuit encountered apparently

arose from the meaning of "prisoners’

personal property fund" and whether that

phrase refers to a prisoner’s individual

account or to the fund as a whole. To

begin with, the word "prisoners’" is a

plural possessive which indicates on its

face an inclusion of all inmates, not

just one. Further, the word "fund"

clearly refers to one collective fund,

not to many individual accounts.

Applying traditional statutory analysis

and looking at the plain meaning of the

Statute, the phrase "prisoners’ personal

property fund" cannot logically be

interpreted to mean anything other than

one collective fund for all prisoners,

not each prisoner’s individual account.

The prisoners’ personal property fund,

as one collective fund, under the plain

language of the statute, earns interest

which is to be credited to that

collective fund as a whole, and not to

each prisoner’s individual account.

Nowhere does Nev. Rev. Stat. 209.241

require the director to keep an account

of the interest earned on the money in

the fund for each inmate and credit the

interest to individual inmate accounts.

The language of Nev. Rev. Stat.

356.087 is further evidence that interest

must be credited to the "fund" as a

whole:

1. Except as provided in

subsections 2, 3 and 4 or ina

specific statute, all interest paid

on money belonging to this state

must be deposited in the state

general fund.

2. Interest earned and received

on any gift or bequest to an agency

of the state must be credited to

the agency unless the gift or

bequest provides otherwise. an

agency, when depositing a gift or

bequest, shall notify the state

treasurer whether it is a gift or

bequest which entitles the agency

to the interest earned.

3. For each fund or account

which by specific statute is

credited with the interest earned

on money deposited in it, the state

treasurer shall determine the

proportionate share of interest and

income earned by it and credit that

amount to it. [Emphasis added.]

It is clear that the term "it" refers

to the fund and not individual inmates.

Notwithstanding the above, there is no

plain language in the statute upon which

any inmate could arguably rely as

creating a protected property interest.

If the statute provided that all interest

shall be credited to each individual

inmate account, then such an argument

could be made. However, such language

does not exist in the statute. In order

to create a protected liberty or property

interest, a state regulation must contain

substantive predicates, and if the

predicates are found to exist, then the

regulation must provide for a particular

Or mandatory outcome to follow. Kentucky

Dept. of Corrections v. Thompson, 490

U.S. 454, 462 (1989). However, the

mandatory outccme must be created by

"unmistakably mandatory language"

contained in the regulation. Hewitt v.

Helms, 459 U.S. 460, 471-462 (1983).

There is no explicit, unmistakable

mandatory language in the Nevada statutes

creating a protected property interest

for each inmate on the interest earned on

the fund referred to in the statute. The

opposite is true, and is demonstrated by

these factors:

(1) The district court’s

interpretation of the statute was the

opposite of the Ninth Circuit’s

interpretation. If indeed the language

of the statute was explicit and

unmistakable, the two courts would hardly

have come to different conclusions;

(2) The legislature has continued to

approve, every two years when it meets,

the budget for the Nevada Department of

Prisons, which is based upon the interest

in the inmate accounts being credited to

a collective fund, from which it is

intended the proceeds to benefit all

inmates by funding law libraries and

recreational equipment.

2. The Legislature has Acquiesced in the

Department of Prisons’ Interpretation of

the Statute.

The legislature consistently has

acquiesced in the interpretation and

construction of Nev. Rev. Stat. 209.241

by the Director of the Nevada Department

of Prisons. Since 1981, when the

statutory language relevant to interest

of the offenders’ earnings was

incorporated into the Statute, the

interest earned on prisoners’ personal

property accounts has been credited to a

"general welfare fund" to Support law

libraries and purchase recreational

equipment for use by the inmates. The

legislature has continued to approve the

budget for the Nevada Department of

Prisons, which has always been based upon

applying all earned interest to the

prisoner’s collective fund.

The district court determined that

such a policy is reasonable, benefits the

inmates, and has not been modified by the

legislature in all the years since it was

implemented. (CR 17, p. 5).

When application of federal law

depends on an interpretation of state law

and no extraordinary circumstances exist,

a federal court should defer to the

rulings of the state’s highest court.

Gentry v. MacDougall, 685 F.2d 322, 323

(9th Cir. 1982). The Nevada Supreme

Court in Bing Const. Co. of Nevada v.

Nevada Dept. of Taxation, 109 Nev. 275,

849 P.2d 302 (1993), stated "the

Legislature’s acquiescence in an agency’s

reasonable interpretation indicates that

the interpretation is consistent with

legislative intent." Id. at 305 (citing

State ex rel. Tax Comm’n v. Safeway, 99 |

Nev. 626, 668 P.2d 291 (1983)). The

Nevada Supreme Court, in Hughes

Properties v. State of Nevada, 100 Nev.

295, 680 P.2d 970 (1984), stated "Where,

as here, the legislature has had ample

time to amend an administrative agency’s

reasonable interpretation of a statute,

but fails to do so, such acquiescence

indicates the interpretation is

consistent with legislative intent." Id.

at 972 (citing Summa Corp. v. State

Gaming Control Board, 98 Nev. 390, 392,

649 P.2d 1363 (1982)). The Nevada

Legislature has had ample time to amend

Nev. Rev. Stat. 209.241, and has chosen

not to do so.

The issue of interest earned on the

prisoners’ personal property fund being

used for the benefit of all inmates,

rather than being credited to the

individual inmate accounts, was

specifically addressed by the legislature

in 1983 and 1989. If the legislature had

wanted the interest credited to

individual inmate’s accounts, it could

have amended Nev. Rev. Stat. 209.241 to

reflect such a requirement. But the

legislature chose not to do so, and thus

it has clearly acquiesced in the Nevada

Department of Prisons’ interpretation of

the statute, and Plaintiff cannot have

developed any expectation that the

interest earned on the money in the fund

would be remitted to his individual

account.

The Nevada Department of Prisons has

never submitted a budget to the

legislature which credits interest to

individual inmate accounts, nor has the

legislature ever approved a budget that

would credit interest to inmates. The

fact that the legislature has never

intended that interest be credited to

individual inmate accounts is evidenced

by the biennial legislative approval of

the individual trust fund budget accounts

presented to it. These accounts reflect

that all interest is deposited to the

inmate welfare account for the benefit of

all inmates. If Nev. Rev. Stat. 209.241

required that interest be credited to

individual inmate accounts, the

legislative auditor would have found the

Nevada Department of Prisons to be out of

compliance with the statute.

The legislative history of Nev. Rev.

Stat. 209.241 indicates that the

legislature did not intend for interest

earned from the fund to be credited to

individual inmate accounts, but rather is

to be used for the benefit of all

inmates.

Nev. Rev. Stat. 209.241 is not

ambiguous. It is clear any interest

should be credited to the fund and not to

an individual inmate. This is even more

obvious when read in conjunction with

Nev. Rev. Stat. 356.087. When either of

two interpretations can be reasonably

drawn from the language of a statute,

then the statute is ambiguous and the

plain meaning rule has no application.

Ambiguous statutes should be construed in

line with what both reason and public

policy indicate the legislature intended.

Hotel Employees and Restaurant Employees

Int’l Union v. State ex rel. Nevada

Gaming Control Bd., 103 Nev. 588, 591,

747 P.2d 878 (1987). Ambiguous words

should be given the meaning generally

ascribed to them in the community. State

v. Webster, 102 Nev. 450, 453, 726 P.2d

831 (1986). An ambiguous statute should

be construed in line with reason, public

policy, and legislative intent. Robert

E. v. Justice Court, 99 Nev. 443, 445,

664 P.2d 957 (1983). Where the meaning

of a statute is doubtful a court should

consider the effect or consequences.

Nevada Tax Comm’n. v. Bernhard, 100 Nev.

348, 351, 683 P.2d 21 (1984).

In Las Vegas Sun v. District Court,

104 Nev. 508, 761 P.2d 849 (1988), The

Nevada Supreme Court held that statutes

should be interpreted so as to effect the

intent of the legislature in enacting

them; the interpretation should be

reasonable and avoid absurd results. Las

Vegas Sun v. District Court 104 Nev. 508,

511 (1988) citing for authority Cragun v.

Nevada Pub. Employees’ Ret. Bd., 92 Nev.

202, 547 P.2d 1356 (1976). in Siis y,

Jesch, 101 Nev. 690, 709 P.2d 172 (1985),

The Nevada Supreme Court liberally

construed a statute to protect workers

and families rather than to interpret the

statute narrowly and preciude the

compensation in all claims of asbestos-

related cancers. The court in Jesch held

"Statutory interpretation should not .

yield an unreasonable result if a more

reasonable result is available." SIIS v.

Jesch, 101 Nev 690, 694 (1985) citing for

authority Sheriff v. Smith, 91 Nev. 729,

733, 542 P.2d 440, 443 (1975). See also

Breen v. Caesars Palace, 102 Nev. 79, 715

P.2d 1070 (1986) where the court held "We

will not construe a statute to produce an

unreasonable result when another

interpretation will produce a reasonable

result." Breen v. Caesars Palace, 102

Nev. 79, 80 (1986) citing for authority

Alper v. State ex rel. Dep’t of Hwys., 96

Nev. 925, 930, 621 P.2d 492 (1980).

Mandating the Nevada Department of

Prisons to pay interest to every inmate

individually is an interpretation which

would lead to an unreasonable, absurd and

unintended result. The cost to implement

the Ninth Circuit Court’s order would

cost more than the benefits achieved.

The Nevada Supreme Court has held that

statutes are not to be construed in a

manner which will bring about an

unreasonable result, or a result contrary

to the legislature’s purpose. NL

In ri v._Ei m mi » 96

Nev. 253, 645 P.2d 976 (1982) citing for

authority Thomas v. State, 88 Nev. 382,

498 P.2d 1314 (1972).

3. The Impact on The Prison System of

Payin nterest on Individual Inm

Trust Accounts Would be Burdensome and

Costly.

The practicality of the district

courts’ interpretation, as compared to

the devastating consequences of the Ninth

Circuit’s analysis, cannot be

overemphasized or ignored. The United

States Supreme Court held in Turner v.

Safley, 482 U.S. 76, 107 S.Ct. 2254

(1987), that "A third consideration is

the impact accommodation of the asserted

constitutional right will have on guards

and other inmates, and on the allocation

of prison resources generally." Turner

v. Safley, 482 U.S. 76, 89 (1987).

If the Nevada Department of Prisons

were to be required to pay interest on

each individual inmate account within the

Prisoners’ Property Fund, the entire

Nevada Department of Prison fiscal system

would have to be reorganized at great

expense to the state.

The following is a cursory explanation

of the system as it is organized to date

and the costs and procedures which would

be required to implement the mandates of

the Ninth Circuit Court’s order.

The interest distributed by the

Treasurer from the Personal Property Fund

to the Inmate Welfare Account within the

same fund is not solely interest earned

on inmates’ deposits. It actually is

composed of interest earned from all

inmate accounts (NRS 209.241), a Division

of Forestry (NDF) Account (NRS 209.231)

and funds in the Inmate Welfare Account

(IWA), which includes funds obtained from

the Offender’s Store Fund, a fund

separate from the Prisoners’ Property

Fund (NRS 209.221).

In order to pay each inmate a share of

interest earned on each individual

account, the Department of Prisons would

not only have to separate the earnings

for over 7,350 inmate accounts (which are

constantly changing as inmates enter or

leave the prison system), but also the

interest earned for each inmate from the

NDF fund and the IWA fund.

Arguably, the Nevada Department of

Prisons could establish separate outside

bank accounts for all these transactions

and for each inmate; however, the State

Treasurer’s Office does not permit this.

This alternative would also be very time-

consuming and complicated, and would

essentially transform the Nevada

Department of Prisons into a bank. The

Nevada Department of Prisons could also

find itself subject to state and federal

banking regulations. The current average

weekly balance of all inmate accounts in

the fund is approximately $615,802. The

average weekly inmate account balance

based on that amount for 7,350 inmates is

$84. The average monthly interest earned

per account, based on the Treasurer’s

last quarterly earning of 4.75% annually

would be $0.33 (33 cents). Total

interest per year for all accounts would

be approximately $29,326.50.

‘,It is estimated the cost of the

software programming to enable the Nevada

Department of Prisons to distribute

interest and reconcile accounts would be

approximately $32,000 to $40,000, plus

$3,600 every year for program maintenance

charges. Two staff positions would be

required to manage the accounts, which

would cost approximately $83,992 per

year.

Interest earned on the total

Prisoners’ Property Fund (which includes

NDF and Store interest) was $55,708 in

fiscal year 1993. Estimated ‘itedeat

earned on inmate accounts only was

$29,326.50. The cost to distribute and

manage the interest payments would be

greater than the interest earned by the

inmate accounts. Even if the inmates

were charged fees to manage the banking

accounts, the state would still lose

money. The inmates would lose $29,326.50

per year to support their law libraries,

to purchase recreational items, and to

purchase other items for the benefit of

all inmates.

Another problem which the Ninth

Circuit failed to address is whether the

Nevada Department of Prisons would be

required to pay, retroactively, interest

tc inmates. The interest transferred to

the inmates’ fund in prior quarters and

years has already been disbursed. It

would be virtually impossible to figure

out past inmate daily account balances,

with subtractions for NDF and Store Fund

disbursements to IWA.

In addition, the Nevada Department of

Prisons would be required to issue a Form

1099 to the IRS for each prisoner

receiving interest from the Treasurer.

4. The Ninth Circuit Court Should Have

Abstained from Interpreting the State

Statute Adverse to the State’s Interests

and Certified the Question to the Nevada

State Supreme Court.

If the Court of Appeals was unable to

uphold the district court’s granting

summary judgment in favor of Defendants

on the issue of interest as discussed

herein, then it is respectfully submitted

the Ninth Circuit should have certified

the issue to the Nevada State Supreme

Court on the matter of interpretation of

its own state statute. The Ninth Circuit

has certified questions regarding

interpretation of a state’s law toa

state’s supreme court. See e.g., Hansen

v. White, 947 F.2d 1378, 1379 (9th Cir.

1991). This Court may wish to abstain

and certify the question presented under

the doctrine of abstention as set forth

in Railroad Commission of Texas v.

Pullman, 312 U.S. 496 (1941).

"{A]bstention protects state sovereignty

over matters of local concern, out of

considerations of federalism, and out of

‘scrupulous regard for the rightful

independence of state governments. ’"

Almodovar v. Reiner, 832 F.2d 1138, 1140

(9th Cir. 1987) (quoting Pullman, 312 U.

S. at 501). A court which abstains in an

effort to avoid unnecessary consti-

tutional adjudication is "seeking to

promote a harmonious federal system by

avoiding a collision between the federal

courts and state (including local)

legislatures." Waldron v. McAtee, 723

F.2d 1348, 1351 (7th Cir. 1983).

"Abstention is appropriate where an

unconstrued state statute is susceptible

of a construction by the state judiciary

‘which might avoid in whole or in part

the necessity for federal constitutional

adjudication, or at least materially

change the nature of the problem.’"

Bellotti v. Baird, 428 U.S. 132, 147

(1976) (quoting Harrison v. NAACP, 360

U.8. 167, 277 ¢i$83))< It is a state

court which can authoritatively interpret

its own state authorities and ordinances.

United States v. Thirty-Seven

Photographs, 402 U.S. 363, 369 (1971).

When the application of federal law

depends on an interpretation of state law

and no extraordinary circumstances exist,

a federal court should defer to the

ruling of the state’s highest court on

the issue. Gentry v. MacDougall, 685

F.24 322,'- 323: (90N:Cizc. 2962) :

A case must meet three requirements in

order for the court to abstain: first,

the case must involve a sensitive issue

of social policy which federal courts

ought not to enter absent the lack of an

alternative; second, a definitive ruling

by the state court would avoid the

constitutional question; and third, the

issue of state law must be doubtful. C.yY.

Dev m a f Redlands, 703

F.2d 375 (9th Cir. 1983). This case

involves a statute which is capable of

more than one interpretation.

Petitioners argue that Nev. Rev. Stat.

209.241 requires interest to be credited

to the collective fund as a whole.

Respondent argues that Nev. Rev. Stat.

209.241 requires interest to be credited

to his individual account. A definitive

ruling by the state court on this issue

would avoid the constitutional question

because the court’s ruling would

determine whether the statutes creates a

protected property interest for each

inmate on the interest earned from the

prisoners’ personal property fund. Thus,

this Court should abstain from deciding

this issue.

Abstention is limited by

considerations of delay and expense,

however, the availability of

certification greatly simplifies the

analysis and its utilization. Bellotti,

428 U.S. at 150-151. Certification

"'does of course, in the long run save

time, energy and resources and helps

build a cooperative judicial

federalism.’" Id. (quoting Lehman

Brothers v. Schein, 416 U.S. 386, 391

(1974)).

Nevada Rule of Appellate Procedure 5

permits the Nevada Supreme Court to

answer questions of law certified to it

by feceral courts, “when requested by the

certifying court, if there are involved

in any proceeding before those courts

questions of law of this state which may

be determinative of the cause then

pending in the certifying court and as to

which it appears to the certifying court

there is not controlling precedent in the

decisions of the supreme court of this

state." Nev. R. App. P. 5S.

5. There is No Constitutional Right of

Inm nter d mate

Trust Accounts.

The Due Process Clause of the

Fourteenth Amendment provides that no

State may "deprive any person of life,

liberty, or property, without due process

of law." The court must determine

whether a due process violaticn has

occurred by way of a two-step process.

Kentucky Dept. of Corrections v.

Thompson, 490 U.S. 454, 460 (1989). The

threshold question is whether a

constitutionally protected interest is

implicated. Meachum v. Fano, 427 U.S.

215, 223-224 (1976); Baumann v. Arizona

Dept. of Co ctions, 754 F.2d 841, 843

(9th Cir. 1985); Williams v. , 648

F. Supp. 510, 511 (D.Nev. 1986).

[T]o obtain a protectable right

‘a person clearly must have more

than an abstract need or desire for

it. He must have more than a

unilateral expectation of it. He

must, instead, have a legitimate

claim of entitlement to it.’

Nev. Rev. Stat. 209.241 does not

create any property interest in plaintiff

receiving interest on his inmate account.

There is no language within the statute

which would lead an inmate to believe he

should receive interest on his individual

inmate account, since the statute clearly

provides the interest is to be applied to

the prisoners’ fund.

The United States Supreme Court in

Procunier v. Martinez, 416 U.S. 396, 412

(1974) stated,

Suffice it to say that the problems

with prisons in America are complex

and intractable and, more to the

point, they are not readily

susceptible of resolution by

Gecree. Most require expertise,

comprehensive planning, and the

commitment of resources, all of

which are peculiarly within the

province of the legislative and

executive branches of government.

For all of these reasons, courts

are ill equipped to deal with the

increasingly urgent problems of

prison administration and reform.

Id. at 404-405.

"Prison administrators therefore

should be accorded wide-ranging deference

in the adoption and execution of policies

and practices that in their judgment are

needed to preserve internal order and

discipline and to maintain institutional

security." Bell v. Wolfish, 441 U.S.

520, 547 (1979). A federal court should

not substitute its judgment for prison

administrators "in the absence of

substantial evidence in the record to

indicate that the officials have

exaggerated their response to these

considerations." Pell v. Procunier, 417

U.S. 8617, 827 (1974). Prison

administration is a task that is

committed to the responsibility of the

legislative and executive branches.

Separation of powers concerns counsel a

policy of judicial restraint. When a

federal court is determining the

constitutional validity of prison rules,

regulations and/or practices of a state

penal system, there is additional reason

to accord deference to the appropriate

prison authorities. Mi Vv.

Sumner, 860 F.2d 328, 331 (9th Cir.

1988).

Federal courts may not interfere with

decisions made by state prison officials

absent a constitutional violation.

Hoptowit v. Ray, 682 F.2d 1237, 1246 (9th

Cir. 1982).

The above standard applies even if an

inmate’s constitutional rights are

impinged by a prison rule, regulation, or

practice. The Supreme Court has

repeatedly emphasized that, in

determining the validity of regulations

impinging on the constitutional rights of

inmates, courts are to accord great

deference to prison officials’ assessment

of their interests. See e.g., Turner v.

Safley, 482 U.S. 78, 84-85 (1987); QO’ Lone

v. Estate of Shabazz, 482 U.S. 342, 349

(1987). This is due to the fact the

realities of running a penal institution

are complex and difficult and prison

authorities are best equipped to make the

intricate decisions regarding prison

administration. Jones v. North Carolina

Prisoners’ Labor Union, Inc., 433 U.S.

119, 126-128 (1977).

When a prison regulation impinges on

any constitutional right of an inmate, it

is valid if it is reasonably related to

legitimate penological interests.

Washington v. Harper, 494 U.S. 210

(1990); O’Lone v. Estate of Shabazz, 482

U.S. at 349; Turner, 482 U.S. at 95-96.

In Foster v. Hughes, 979 F.2d 130 (8th

Cir. 1992), Inmates brought § 1983 action

claiming that Missouri arbitrarily denied

them the right to place their monies in

private, interest-bearing accounts. The

Department of Corrections kept individual

accounts for each inmate and pooled all

inmate funds for deposit in a non-

interest bearing account. The Eighth

Circuit held, inter alia, that providing

the inmates’ access to private accounts

would seriously burden prison operation.

Relying on Turner v. Safley, 482 U.S. 78

(1982), the court found that the

regulation did not unconstitutionally

infringe upon the rights of the inmates.

The court in Foster based this decision

not only on the burden it posed on the

prison system, but also because the

inmates had alternative methods of

earning interest.

Similarly, under Nevada Department of

Prisons’ Administrative Regulation 259,

inmates have the option to deposit, with

the aid of an outside individual, their

funds in outside bank accounts that bear

interest. They are not required to

deposit with the Nevada Department of

Prisons.

The court in Hendrix v. Evans, 715 F.

Supp. 897 (N.D.Ind. 1989), dealt with an

Indiana law which also provides that all

inmate funds are deposited into a trust

fund. The court stated, "[{i]nterest

accrues on the funds deposited in trust,

and it is the trust that has a legal

right to the accrued interest, not the

inmate." Hendrix, at 911. The court

stated:

In not denying that either

plaintiff has funds deposited ina

DOC trust account, the defendants

cite three district court decisions

in which the courts have found that

the Constitution does not create a

right to earn interest on personal

funds while incarcerated. In X

(Smith) v. Robinson, 456 F. Supp.

449 (E.D.Pa. 1978), the district

court concluded that there is no

right, under any aspect of the Due

Process Clause, to earn interest on

monies received while incarcerated.

Id. at 454. In Bijeol v. Benson,

404 F. Supp. 595 (S.D.Ind. 1975),

District Judge James E. Noland

found that a federal prisoner has

no constitutional right to draw

interest on his commissary account.

id. at 599. Lastly, in Gray v.

Lee, 486 F. Supp. 41 (D.Md. 1980),

aff’‘d, 661 F.2d 921 (4th Cir.

1981), the district court concluded

that refusal to pay interest on

inmate funds did not deprive

inmates of property without due

process "[i]nasmuch as prisoners

may transfer funds from their

spending account to a ‘free-world’

interest bearing savings

account....° ie. at 45.

Hendrix at 911.

Plaintiff does not have the right,

under the Due Process Clause of the

Constitution, to earn interest on his

inmate account while incarcerated. Nev.

Rev. Stat. 209.241 does not require that

interest be credited to individual inmate

accounts. Finally, the Nevada

Legislature does not intend for interest

to be credited to individual inmate

accounts. Plaintiff has not suffered a

due process violation and the Ninth

Circuit Court of Appeals erred in

reversing the District Court.

CONCLUSION

It is clear in light of the syntax of

"Prisoners’ Personal Property Fund",

legislative acquiescence as indicated by

the history of the legislation, the fact

that no unmistakable and clear language

exists for an inmate to conclude he has a

protected property interest, and the

impact the decision would have on other

inmates and the allocation of prison

resources, the Ninth Circuit erred in

finding that Nev. Rev. Stat. § 209.241

creates a protected property interest.

The result that will be achieved in

the order by the Ninth Circuit is

administrative unfeasibility, high cost

and deprivation of resources for the

inmates. It will cost much more to

implement the requirements of The Ninth

Circuit’s Court order than the cumulative

financial advantage to the inmates.

For the reasons discussed above, the

State respectfully requests this Court

grant certiorari, receive briefs on the

merits, and ultimately reverse the

judgment of the Ninth Circuit court of

Appeals.

Respectfully submitted.

FRANKIE SUE DEL PAPA

Attorney General of the

State of Nevada

BROOK A. NIELSEN

Assistant Attorney General

THOMAS J. RAY

Solicitor General

ANNE B. CATHCART*

Senior Deputy Attorney General

Litigation Division

Capitol Complex

Carson City, Nevada 89710

Telephone: (702) 687-4170

Counsel for Petitioners

*Attorney of Record

APPENDICES

APPENDIX A

UNITED STATES DISTRICT COURT

DISTRICT OF NEVADA

LESTER TELLIS,

CV-S-90-799-LDG(LRL)

Plaintiff,

Vv.

S. GODINEZ, et al.,

)

Defendants. )

)

ORDER

This matter is before the court on

plaintiff’s motion for partial summary

judgment (#11) and defendant’s cross-

motion for summary judgment (#12a).

1. Facts

In this 42 U.S.C. § 1983 civil

rights action the plaintiff Lester

Tellis, a Nevada state prisoner, contends

that monies in his personal prison bank

account are being withheld from him in

violation of federal constitutional due

process. Tellis also contends that he is

being deprived of the interest earned on

A-1

the money in his account without the

benefit of due process protections.

Defendants, Nevada state prison

officials, admit that Tellis has no

present access to these funds and that

the interest earned on them is not being

paid back into his account. They

maintain, however, that they have the

authority under Nevada law to require

prisoners with an eventual release date

to maintain a two-hundred dollar ($200)

minimum balance’ in their personal prison

account until the date cr their release

to cover the prisoners’ post-release

expenses, and to credit interest earned

on prisoners’ personal accounts to the

prisoners’ personal property fund

generally, rather than to individual

accounts.

‘It is undisputed that the present

balance of Tellis’ account equals one-

hundred sixty-three dollars and seventy-two

cents ($163.72), below the minimum required

by prison regulations.

A-2

The Fourteenth Amendment to the

United States Constitution prohibits a

state government from depriving a person

of life, liberty or property without due

process of law, U.S. Const. amend XIV §

1. This right to due process only

attaches when a person is deprived of an

interest independently recognized as

"protected" under state, federal or

constitutional law, Olim v. Wakinekona,

£63. 33.4. 2390,;-103 6.Ct. 1741, 75 L.84.2d |

813 (1983). In other words, the Due |

Process Clause itself does not confer any |

substantive rights, but rather provides

procedural protection in the event that a

person is deprived of an independent,

substantive interest, Olim, 461 U.S. at

250, 103 S.Ct. at 1748 ("Process is not

an end in itself. Its constitutional

purpose is to protect a substantive

interest to which an individual has a

legitimate claim of entitlement"). Also

see, Cleveland Board of Education v.

Loudermill, 470 U.S. 532, 105 S.Ct. 1487,

84 L.Ed.2d 494 (1985). Here the question

is whether Tellis has a protected

property or liberty interest in the funds

in his prison account, or in the interest

earned by those funds.

A. Tellis’ property interest in

the funds themseives

Clearly a prisoner has a protected

property interest in the funds he/she

maintains in a personal prison bank

account, Quick v. Jones, 754 F.2d 1521,

1523 (9th Cir. 1985). This means that

the state may not appropriate any amount

of those funds, however small, for its

cwn use or the use of others absent some

sort of procedural mechanism which will

satisfy the requirements of due process,

Id. at 1524. However, in this case there

is no allegation that the state has

withdrawn or threatened to withdraw any

money from Tellis’ account for its own

use or the use of others without the

requisite due process.

B. Tellis’ property interest in

the interest earned

Tellis does allege that the state is

depositing the interest earned on his

money into the prisoners’ personal

property fund generally, rather than into

his own account. The defendants do not

dispute this. Rather, they cite Nevada

Revised Statutes § 209.241 as authority

for this procedure. That statute

provides, in pertinent part:

a The director [of prisons] may

accept money . . . belonging to an

offender at the time of his incarceration

or afterward received by gift,

inheritance or the like or earned during

the incarceration of an offender and

shall deposit the money in the prisoners’

personal property fund, which is hereby

created as a trust fund.

Re The interest and income earned

on the money in the fund, after deducting

A-5

any applicable charges, must be credited

to the fund.

The question presented here is whether

the words "the fund" in sub-section 3 of

this statute (which has not been

interpreted by the Nevada courts) refer

to a prisoner’s individual account within

the prisoners’ personal property fund, or

to the fund as a whole.

The court finds that the statute is

ambiguous with respect to this issue.

Sub-section 3 refers to "the fund"

generally in the same way that "the

fund," meaning the whole of the

prisoners’ personal property fund, is

referred to in the rest of the statute.

Thus, a literal reading of this language

suggests that interest earned on

prisoners’ accounts be deposited into the

fund generally, which is consistent with

the defendants’ present policy. Asa

general rule, language on the face of a

statute which is unambiguous when read

A-6

7” | , |

according to its ordinary meaning should

be construed according to that meaning in

the courts, United States v. Locke, 471

U.S. 84, 105 S.Ct. 1785, 85 L.Ed.2d 64

(1985).

However, a statute which is

unambiguous on its face may be considered

ambiguous if the plain meaning of that

statute leads to a result not reasonably

contemplated by the legislature, United

States v. Mendoza, 565 F.2d 1285,

rehearing 581 F.2d 89 (Sth Cir. 1978).

The question immediately arises upon

review of NRS § 209.241(3) -- where does

the interest earned by the prisoners’

money ultimately go? Sub-section 1 of

the statute explicitly provides that the

"“prisoners’ personal property fund" be

created as a trust fund. This puts the

prisoners who have accounts in the fund

in the position of beneficiaries of a

trust and the state of Nevada in the

position of a fiduciary. Certainly,

under conventional notions of fiduciary

duties, it is not proper for a trustee to

divert interest earned on trust funds to

a use other than one which would benefit

the beneficiary of the trust, see A.

Scott & W. Fratcher, Th Ww T P

4th ed. § 207.1. Seen in this light, it

may be that NRS § 209.241 could plausibly

be read, and that the legislature

intended, to provide that interest earned

on a prisoner’s own funds should be

credited to that prisoner’s personal

account. This interpretation of the

statute would support a prisoner’s

reasonable expectation that the interest

earned on his money would be so

allocated. Such a reasonable expectation

may well qualify as a protected property

right, see McGraw v. City of Huntington

Beach, 882 F.2d 384 (9th Cir. 1989)

(state statute giving rise to reasonable

expectation of continued employment

creates property interest in that

employment to which due process applies).

Because 1) it is not clear from the

record how the interest which "must be

credited to the fund" pursuant to NRS §

209.241(3) is ultimately spent and 2) the

issue of Tellis’ reasonable expectation

in the receipt of that interest has not

been addressed by the parties, the court

finds it in the interests of justice to

allow the parties to re-brief those two

issues.

&. Tellis’ interest in the "use"

of his funds

Plaintiff's main contention is that

he is being deprived of the "use" of his

funds without due process of law.

However, it is not clear that prisoners

have any protected interest in the use of

the funds in their personal property

accounts prior to their release (though

“0 a

they would certainly have one at the time

of their release). such an interest

would either be a "property" or "liberty"

interest under the Fourteenth Amendment.

Although the question of a

prisoner’s property or liberty interest

in the use of funds in his/her prison

bank account has not been heavily

litigated in the courts of this or any

other jurisdiction, what authority there

is suggests that such an interest exists

only if it is conferred by a state or

federal statute. The Seventh Circuit

Court of Appeals, facing a situation

Similar to that presently before this

court, observed the following in dictum:

It is beyond dispute that [the

prisoner] has a property interest in the

funds on deposit in his prison account.

See, e.g., Quick v. Jones, 754 F.2d 1521

(9th Cir. 1985); Jensen v. Klecker, 648

F.2d 1179, 1163 (6th cir. 1961); Sell vy.

Parratt, 548 F.2d 753, 757 (8th Cir.),

cert. denied. 434 U.S. 873,- 98 8.Ct. 220,

54 L.Ed.2d 152 (1977). Yet, [the

prisoner] does not argue, nor could he,

that the government has caused him to

forfeit these funds or to pay them over

A-10

to it. He complains, rather, that he may

no longer use in a particular way

property that is his. It is difficult to

Say whether [the prisoner’s] claim, so

characterized, implicates a property

interest or a liberty interest. In any

event, his due process claim must be

supported by a protected interest in the

use of his commissary account.

Loudermill, ---- U.S. ----, 105 S.ct. at

1491; Shango [v. Jurich, 681 F.2d [1091]

at 1097 <¢7th Cir. 1963) }..

For the purposes of the Due Process

Clause, property interests must be found

in state or federal law. Board of

Regents v. Roth, 408 U.S. 564, 577, 92

S.Ct. 2701, 2709, 33-L:Ed:2d $48 (1972) ;

Shango, 681 f£.2d at 1097. Liberty

interests, however, may originate in the

Constitution as well. Hewitt v. Helm,

459 U.S. 460, 466, 103 S.Ct. 864, 869, 74

L.Ed.2d 675 (1983); Matthews v. Fairman,

779 Pi2a: 409, -472 {7th Cir. 1985);

| Shango, 681 F.2d at 1097. [The prisoner]

does not point to, nor do we see, a

liberty interest arising out of the

Constitution itself to support his due

process claim. Thus, whatever interest

is implicated by Campbell’s claim must be

created by state or federal law. Because

the analysis for property and liberty

| interests created by state or federal

enactments is the same, Wolff v.

McDonnell, 418 U.S. 539, 557, 94 S.Ct.

2963, 2975, 41 L.Ed.2d 935 (1974) ;

Shango, 681 F.2d at 1097, the ambiguity

in [the prisoner’s] argument as to

whether he is asserting a property ora

liberty interest in the use of his inmate

account is inconsequential to the

disposition of his claim. Since Campbell

is a federal inmate, we confine our

inquiry to federal law (here, federal

prison regulations) involving inmate

commissary accounts.’

Although a protected interest may be

created through the enactment of

regulatory measures, see, e.g., Wolff,

478 U.S. at 557, 94 S.Ct. at 2975 (good-

time credits); Greenholtz v. Nebraska

Penal Inmates, 442 U.S. 1, 99 S.Ct. 2100,

60 L.Ed.2d 668 (1979) (parole); Vitek v.

Jones, 445 U.S. 480, 100 S.Ct. 1254, 63

L.Ed.2d 552 (1980) (transfer to mental

institution), the regulation must support

a claim of entitlement to the benefit in

question. We do not look to the weight

or importance of that benefit to the

individual, but rather the manner in

which it was conferred. Greenholtz, 442

U.S. at 7, 99 S.Ct. at 2103; Vago vy. Van

Curen, 454 42.8. Ayo 24, 2a Sit Sky 24,

70 L.Ed.2d 13 (1981). Unless the

regulation limits an official’s

discretion in denying the benefit to

"objective and defined" criteria, no

protected interest has been created.

Olim v. Wakinekona, 461 U.S. 238, 249,

103 §.Ct.: 174ky «i 47, 73% tive Bis

(1983) (quoting Connecticut Board of

Pardons v. Dumschat, 452 U.S. 458, 467,

101 S.Ct. 2460, 2465, 69 L.Ed.2d 158

(1981) (Brennan, J., concurring); Hewitt,

459 U.S... at: 471 -72;::103 8.Cce.. at B7is

Mathews, 779 F.2d at 413; Achacoso-

Sanchez v. INS, 779 F.2d 1260, 1264-65

(7th Cir 1985). Of course, once it is

determined that a protected interest

exists, it is no longer the prerogative

of the promulgating agency to define the

procedures to be followed in protecting

that interest; that is a matter of

constitutional law. Loudermill, ----

*In the instant case Nevada state law

and prison regulations are applicable.

A-12

U.S. at ----, 105 S.Ct. at 1487; Logan v.

Zimmerman Brush Co., 455 U.S. 422, 432,

102 6.<Ce. 2266, 1155 ;,:.71 L.Ed.2d 265

(1982); Vitek 445 U.S. at 491, 100 S.Ct.

at 1263. Thus, if the federal prison

regulations governing inmate discipline

and the use of inmate accounts place

substantive limits on the discretion of

prison authorities, and hence, give [the

prisoner] an entitlement to the use of

his commissary account, then the

impoundment deprived [the prisoner] of a

protected interest,

Campbell v. Miller, 787 F.2d 217, 222-23

(7th Cir. 1986). The Seventh Circuit

went on to find in Campbell that the

requirements of due process had been met

in that case, and thus that court did not

address the question of whether federal

law created an entitlement on behalf of

the prisoner in that case to the use of

the funds in his account. However, the

discussion quoted above is instructive

for purposes of this case, and this court

finds it persuasive.

The Seventh Circuit stated

unequivocally that a liberty or property

right in a prison account fund must

derive from some source other than the

United States Constitution. The analysis

turns, then, on whether a prisoner can

demonstrate any independent "entitlement"

to the use of his/her funds in state or

federal law. Here there is no suggestion

that federal law is applicable.

Therefore, Tellis’ claim must be based on

the state statute, NRS -§ 209.241. A fair

reading of that statute indicates that

the Director of Prisons has wide

discretion over the release of a

prisoner’s funds kept in his/her personal

prison account up until the time of that

prisoner’s release:

2. The director:

(a) Shall keep, or cause to be

kept, a full and accurate account of the

money and valuables, and shall submit

reports to the board relating to the

money and valuables as may be required

from time to time.

(b) May permit withdrawals for

immediate expenditure by an offender for

personal needs.

we. 2 eee ae) ae

offender upon his release any remaining

balance in his individual account,

N.R.S. § 209.241(2) (emphasis added).

Sub-section 2(b) clearly supports the

defendants’ claim that the Director has

discretion over whether he will allow

withdrawal of a prisoner’s money for

personal needs. Therefore, the statute

does not create any entitlement on behalf

of the inmates to withdraw funds at their

own pleasure. It is well within the

director’s statutory discretion to impose

a policy of requiring a two-hundred

dollar ($200) minimum balance in

prisoner’s accounts to be used to cover

an inmate’s immediate post-release

expenses, which he has done, see Nevada

State Department of Prisons

j Administrative Regulation #258. This

regulation is a proper exercise of the

director’s authority.

Finally, Tellis argues that he has

no real potential for future release due

to the severity of his sentence, although

theoretically he may become eligible for

parole sometime in the future.’ If this

is so, the above analysis is

inapplicable, since the standard

restriction on the use of a prisoner's

personal property funds in such a

circumstance would constitute a

constructive taking of those funds.

Indeed, the prison regulations themselves

provide that the policy of requiring a

two-hundred dollar ($200) minimum balance

in prison accounts does not obtain in the

case of prisoners incarcerated for life

without the possibility of parole, for

obvious reasons, see Administrative

*The record demonstrates that Tellis is

serving two life terms with the possibility

of parole and an additional 109 years, see

defendant’s exhibit #1, motion for summary

judgment (#11).

A-16

Directive #28-90.* Those prisoners who

are never to be released need never cover

any post -release expenses.

The director has determined that

Tellis does not qualify for an exception

to the minimum balance policy because he

is not a prisoner without a release date.

However, it is not clear that this

assessment was based on consideration of

the severity of Tellis’ sentence. Since

the court has decided to allow the

parties to re-brief the issue of where

the interest credited to the prisoner’s

personal property fund is ultimately

allocated, it will be no inconvenience

for the parties also to address the

question of Tellis’ practical potential

for release in those supplemental briefs.

Accordingly, for the reasons above

stated,

‘pefendant’s exhibit D, opposition to

motion for partial summary judgment and

cross-motion for summary judgment (#12).

A-17

IT IS ORDERED that the parties in

this action re-brief the issues of 1) the

final allocation of the interest earned

on the prisoners’ personal property fund,

2) plaintiff's expectation that the

interest earned on his money would accrue

to his own account and 3) plaintiff

Tellis’ practical potential for eventual

release.

SIGNED BY:

LLOYD D. GEORGE

United States

District Judge

APPENDIX B

UNITED STATES DISTRICT COURT

DISTRICT CF NEVADA

LESTER TELLIS, ) CV-S-90-799-LDG(LRL)

)

Plaintiff, )

)

Vv. )

)

S. GODINEZ, et Oi.,)

)

Defendants )

were )

JUDGMENT

IT IS HEREBY ORDERED that judgment

be entered for the defendants in this

action, pursuant to this court’s order

granting the defendants’ cross-motion for

summary judgment (#12).

DATE:_2 April, 1991

SIGNED BY:

LLOYD D. GEORGE

United States

District Judge

APPENDIX C

UNITED STATES DISTRICT COURT

DISTRICT OF NEVADA

LESTER TELLIS,

Plaintiff,

S. GODINEZ, et al.,)

———

)

Vv. ) CV-S-90-799-LDG(LRL)

)

Defendants. )

)

ORDER

This matter comes before the court on

Plaintiff’s Motion for Additional

Findings of Fact and to Amend Accordingly

(#19) and also Plaintiff’s Motion for

Partial Summary Judgment (#20). The

court has also considered Defendant’s

Opposition to Motion for Additional

Findings of Fact (#21), and Plaintiff’s

Reply to that Opposition (#22).

I. BACKGROUND

Plaintiff, a Nevada state prisoner,

brought this civil rights action against

the Defendants, Nevada state prison

officials, contending that monies in his

personal prison bank account and the

interest thereon were being withheld from

him in violation of federal

constitutional due process. After

consideration of the pleadings, this

court ordered (#14) the parties in this

action to re-brief certain issues which

were unclear. After such re-briefing,

this court ordered (#17) that Plaintiff's

Motion for Partial Summary Judgment be

denied and Defendant’s Cross-Motion for

Summary Judgment be granted. Judgment

was then entered for the Defendants

(#18). Plaintiff subsequently filed the

Motions that are now before the court.

II. PLAINTIFF’S MOTION FOR ADDITIONAL

FINDINGS OF FACT

Plaintiff makes this Motion for

Additional Findings of Fact pursuant to

Federal Rules of Civil Procedure, Rule

52(b), which states in pertinent part,

"Upon motion of a party made not later

than 10 days after entry of judgment the

court may amend its findings or make

additional findings and may amend the

judgment accordingly." Plaintiff's

assertion in this Motion is the same as

in his original complaint, that NRS

209.241(3) requires interest from the

Prisoner’s Personal Property Fund be

placed back into each prisoner’s

individuai account. This court has

already ruled that the statute does not

so require, and that the prison policy

- regarding that interest is reasonable and

the Plaintiff could not have reasonably

developed an expectation that the

interest earned on his personal property

account would be remitted to his personal

account. Plaintiff's Motion merely

attempts to reargue his original

complaint, upon which this court has

already ruled. Further, Plaintiff makes

no additional arguments that would

warrant an additional finding of fact,

and therefore this motion must be denied.

III. PLAINTIFF’S MOTION FOR PARTIAL

SUMMARY JUDGMENT

RE: ACCESS TO THE COURTS

Plaintiff’s Motion for Partial Summary

Judgment is innappropriate because

Defendants’ Motion for Summary Judgment

has been granted in this case, and

judgment has accordingly been entered for

Defendants. It is elementary that

summary judgment cannot be entered in an

action that has already been fully

adjudicated by this court. This motion

must also be denied.

Hence, for the reasons above stated,

IT IS HEREBY ORDERED that Plaintiff's

Motion for Additional Findings of Fact

and to Amend Accordingly is DENIED.

IT IS FURTHER ORDERED that Plaintiff’s

Motion for Partial Summary Judgment is

DENIED.

DATE: _3 August, 1991

SIGNED BY:

LLOYD D. GEORGE

United States

District Judge

APPENDIX D

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

LESTER TELLIS,

No 91-16296

Plaintiff-Appellant, :

o&. BO.

Vv. CV 90-799-LDG

S. GODINEZ, et al., OPINION

Defendant-Appellee.

Appeal from the United States

District Court

for the District of Nevada

Lloyd D. George, District Judge,

Presiding

Submitted November 6, 1992”

San Francisco, California

Filed September 28, 1993

Before: Alfred T. Goodwin, Jerome Farris,

and

Harry Pregerson, Circuit Judges.

Opinion by Judge Pregerson;

Dissent by Judge Farris

“The panel unanimously found this case

suitable for cecision without oral argument.

Fed. R. App. P. 34(a); 9th Cir. R. 34-4.

D-1

TELLIS v. GODINEZ

SUMMARY

Individual Rights/Civil Rights

The court of appeals reversed a

judgment of the district court. The

court held that the plain language of a

state statute created a constitutionally

protected property interest in the income

and interest actually earned on money

deposited ina prisoner’s personal

property fund.

Appellant Lester Tellis, a Nevada

state prisoner, sued prison officials

under 42 U.S.C. Section 1983, alleging

violation of due process through the

withholding of interest earned on funds

deposited in his personal prison account.

The officials contended that the prison

director retained complete discretion to

disburse such funds because the statute

authorizing such accounts did not

explicitly restrict that discretion. The

D-2

TELLIS vV. GODINEZ

district court held that Tellis did not

establish the existence of a protected

property interest and gave summary

judgment for the officials. Tellis

appealed.

[1] The section of the statute making

mandatory the deposit of interest and

income earned on money in prisoners’

personal property funds was silent as to

the prison’s authority to withhold such

funds from those accounts under any

Circumstances, [2] whereas other sections

of the same statute expressly authorized

prison officials to expend other funds

and the interest earned on them in

specified ways and in specified

circumstances. It had to be assumed that

the legislature would have expressly

authorizeac any intended expenditure of

interest earned on prisoners’ personal

funds. [3] Tne statute as a whole created

TELLIS Vv. GODINEZ

—_

a protected property interest in those

funds and the prison's failure to credit

them was a violation of Tellis’s right to

due process. :

Judge Farris, dissenting, opined that

the statute relied upon did not create a

protected property interest in Tellis.

COUNSEL

Lester Tellis, Ely, Nevada, plaintiff-

appellant in pro per.

George H. Taylor, Deputy Attorney

General, Carson City, Nevada, for the

defendants-appellees.

OPINION

PREGERSON, Circuit Judge:

Nevada state prisoner Lester Tellis

appeals pro se from a district court

order granting summary judgment in favor

TELLIS Vv. GODINEZ

of defendant prison officials. Tellis

brought this action under 42 U.%.C. §

1983, alleging that prison authorities

violated his due process rights by

withholding interest earned on funds in

}

;

his personal prison bank account.’ We |

reverse.

BACKGROUND

Lester Tellis is a Nevada state

prisoner serving two consecutive life

terms with the possibility of parole and

| an additional consecutive term of 109

years. He currently has $163.72 on

deposit in the Nevada "prisoners’

personal property fund."

Tellis twice requested that prison

officials credit his personal property

‘'Tellis also alleged that prison

funds to hire an investigator, in violation

of his right of access to the courts. We

address this claim in a separate,

unpublished memorandum disposition.

authorities refused to allow him to use his

TELLIS V. GODINEZ

account with interest actually earned on

those funds. Defendants refused,

claiming that Nevada Revised Statute

209.241 grants the Director of Prisoris

authority to use interest earned on

prisoners’ personal accounts at the

director’s discretion.

Tellis then filed a pro se complaint

under 42 U.S.C. § 1983 against various

prison officials, alleging that officials

violated his due process rights by

failing to credit his account with

interest earned on his funds. On cross-

motions for summary judgment, the

district court ruled that Tellis failed

to establish a protected property

interest in interest earned on his funds.

Judgment was entered for defendants, and

Tellis timely appealed.

TELLIS Vv. GODINEZ

STANDARD OF REVIEW

We revicw de novo a district court’s

grant of summary judgment. McGuckin v.

Smith, 974 F.2d 1050, 1059 (9th Cir.

1992). Summary judgment is appropriate

if, after viewing the evidence in the

light most favorable to the party

opposing the motion, there is no genuine

issue of material fact and the moving

party is entitled to judgment as a matter

of law. Id. (citing Hutchinson v. United

States, 838 F.2d 390, 392 (9th Cir.

1988)).

In this -case, the evidentiary

materials submitted by the parties on

cross-motions for summary judgment raise

no genuine issue of material fact.

Therefore, we review the judgment of the

court below to determine whether the

undisputed facts entitled defendants to

judgment as a matter of law.

TELLIS Vv. GODINEZ

DISCUSSION

The Fifth Amendment declares that

"private property [shall not] be taken

for public use, without just

compensation." U.S. Const. amend. V;

Webb’s Fabulous Pharmacies, Inc. v.

Beckwith, 449 U.S. 155, 160 (1980). That

prohibition applies to the States through

the Fourteenth Amendment. Id. It is

undisputed that prison officials have not

"compensated" Tellis for the use of the

interest earned on his savings. The only

question then, is whether the failure to

credit interest actually earned on

Tellis’s savings to his account

constitutes a "taking" within the meaning

of the Fifth Amendment.

The due process guarantees of the

Fifth and Fourteenth Amendments apply

only when a constitutionally protected

liberty or property interest is at stake.

TELLIS v. GODINEZ

Board of Regents v. Roth, 408 U.S. 564,

569 (1972); Soranno’s Gasco, Inc. v.

Morgan, 874 F.2d 1310, 1316 (9th Cir.

1989). Protected property interests are

"created and their dimensions are defined

by existing rules or understandings that

stem from an independent source, such as

state law--rules or understandings that

secure certain benefits and that support

claims of entitlement to those benefits."

Roth, 408 U.S. at 577.

Tellis contends that Nevada Revised

Statute 209.241* ("Prisoners’ Personal

Property Fund") creates such a protected

property interest. In relevant part, §

209.241 provides that:

1. The director may accept money,

including the net amount of any

wages earned during the

incarceration of an offender after

any deductions made by the

director, and valuables belonging

“All references to statutory sections

are to Nevada Revised Statutes.

D-9

TELLIS v. GODINEZ

to an offender at the time of his

incarceration or afterward received

by gift, inheritance or the like,

or earned during the incarceration

of the offender and shall deposit

the money in the prisoners’

personal property fund, which is

hereby created as a trust fund.

3. The interest and income earned

on the money in the fund, after

deducting any applicable charges,

must be credited to the fund.

§ 209.241 (emphasis added).

Specifically, Tellis argues that the

mandatory language of subsection 3,

requiring that interest be credited to

the prisoners’ fund, creates a protected

property interest in such interest. In

response, defendants contend that the

director of the prisons retains complete

discretion to disburse that interest

TELLIS Vv. GODINEZ

because the statute contains no explicit

restriction on that discretion.?

We conclude that Tellis’s construction

of § 209.241 is consistent with both the

plain language of that section, anda

reading of that section in the context of

the entire statute.

(1] First, "a statute must, if

possible, be construed in such fashion

that every word has some operative

effect." United States v. Nordic Village

£0G@.,° 344-3. CE. 112; 1018<€2992).

Section § 209.241 makes mandatory the

deposit of interest and income earned on

money in the prisoners’ personal property

‘Defendants have been using interest

earned on prisoner funds for prisoner

recreation and law library expenses since

1981. They contend that annual audits gave

the legislature constructive notice of this

practice, andthat the legislature’s failure

to overrule the practice constitutes tacit

approval. However, appellees cite no

authority to support such an approach to

statutory construction.

D-11

TELLIS v. GODINEZ

fund. It makes no mention of authority to

withdraw such interest and income under

any circumstances. The requirement to

credit interest and income earned to that

fund would be meaningless in practical

effect if we construe the section to

authorize the director to spend that

money at his discretion.

Second, the "statute is to be read as

a whole, since the meaning of statutory

language, plain or not, depends on

context." King v. St. Vincent’s Hosp.,

112 S. Ct. 570, S74 (1991) (citations

omitted) (refusing to imply a limitation

on one section of a statute where other

sections expressly incorporated such

limits).

[2] Other sections of Chapter 209 of

the Nevada Revised Statutes expressly

authorize prison officials to expend the

funds and interest earned on those funds

. aaaEeEeEeEeEeEeEeEeEeEeEeEE—E—e—=—EEEEaeaEeEeEeEeEeEeEeEeEEEeEeEeeeeee ee ee eeG_—_u_e_e_eePee

TELLIS v. GODINEZ

under certain enumerated circumstances.

For example, § 209.221 requires that

money received from certain sources be

deposited in an "offenders’ store fund."

§ 209.221(1). Money deposited in that

fund "must be expended for the welfare

and benefit of all offenders." §

209.221(3). Interest and income earned on

the offenders’ store fund "must be

credited to the fund and may only be

disbursed as authorized by the

legislature." § 209.225. See also §

209.383(3) (revenue earned on the sale of

blood by prisoners, along with interest

and income earned on that money, must be

deposited in a fund for destitute

prisoners; money may only be withdrawn by

the director to pay stipends to destitute

offenders); § 209.231 (money received

from operation of a conservation camp to

be deposited in a "forestry account" and

iia,

TELLIS V. GODINEZ

Se er es ee t(‘(i~

that money may only be expended for

enumerated forestry-related purposes).

Thus, we must assume that the legislature

would have expressly authorized

expenditure of money earned on prisoners’

personal funds if it intended to do so.

[3] The plain language of this

section, read in the context of the

entire statute, does create a protected

property interest in interest and income

actually earned orm money deposited in the

prisoners’ personal property fund. As

such, the director’s failure to credit

Tellis’s account with interest earned on

his funds violates Tellis’s due process

rights. See Webb’s, 449 U.S. at 164 ("The

earnings of a fund are incidents of

ownership of the fund itself and are

property just as the fund itself is

property.").

TELLIS v. GODINEZ

CONCLUSION

We reverse and remand this matter to

the district court for entry of judgment

in favor of Tellis on this claim.

REVERSED.

FARRIS, Circuit Judge, dissenting:

I would welcome a constitutional right

to interest, as would others in the

marketplace, but there is none.

Our case law makes it clear that "the

plaintiff must show that a protected

property interest was taken." Sierra Lake

Reserve v. City of Rocklin, 938 F.2d 951,

956 (9th Cir. 1991). Tellis has not and

can not meet this burden. He relies on

Nevada Revised Statutes, § 209.241

(1989), which states that the "interest

and income earned ... must be credited to

the [prisoners’] fund." Tellis can not

claim that he had a reasonable

TELLIS Vv. GODINEZ_

expectation of receiving a slice of the

fund interest when, since 1981, the

interest has been used to support prison

law libraries and to purchase

recreational equipment for the inmates.

I respectfully dissent.

APPENDIX E

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

LESTER TELLIS, No. 91-16296

Plaintiff-Appellant, D.C. No.

CV 90-799-LDG

Vv. (Nevada)

S. GODINEZ, et al. ORDER

Defendant -Appellee.

ee eee eee ee ee eee

Before: GOODWIN, FARRIS, and PREGERSON,

Circuit Judges.

Judges Goodwin and Pregerson have voted

to deny appellees’ petition for

rehearing. Judge Pregerson has voted to

reject the suggestion for rehearing en

banc and Judge Goodwin recommends

rejection. Judge Farris would grant the

petition for rehearing but reject the

suggestion for rehearing en banc.

The full court has been advised of the

suggestion for rehearing en banc and no

active judge has requested a vote on

whether to rehear the matter en banc.

Fed. R.. App. iP. 35:

The petition for rehearing is denied

and the suggestion for rehearing en banc

is rejected.

eS ey ee

OR Oe nae

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