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4 IN THE SUPERIOR COURT OF GUAM 5
6 PACIFIC DATA SYSTEMS, INC., and) CASE NO. CV0647-11 7 JOHN DAY, ) Plaintiffs, ) DECISION AND ORDER 8 vs. ) ) 9 GOVERNMENT OF GUAM, and ) 10 CLAUDIA ACFALLE, personally and in) her capacity as Chief Procurement ) 11 Officer for the Government of Guam, ) 12 ) Defendants. ) 13
14 INTRODUCTION 15 This matter came before the Honorable Alberto C. Lamorena IlIon 16 Defendant Claudia Acfalle's Motion to Dismiss. Attorney Fred Nishihira 17 represented Defendant Acfalle. Attorney Bill R. Mann represented Plaintiffs, Pacific 18 Data Systems, Inc. ("PDS") and John Day. Following a hearing on this matter the 19 Court took the motion under advisement. The Court now issues its Decision and 20 Order. 21 FACTUAL HISTORY 22 This Case involves a taxpayer lawsuit for the enforcement of proper 23 government spending by Defendant Acfalle. Defendant Acfalle is the Chief 24 Procurement Officer for the Government of Guam and is charged by law with 25 "procuring or supervising the procurement of all supplies and services needed by 26 the Territory." 5 Guam Code Ann. § 5113(c)(1)(i). Plaintiff PDS is a 27 telecommunications provider licensed to do business on Guam. In 2004, the Guam 28 Legislature passed the Guam Telecommunications Act of 2004, which privatized the Decision and Order Case No. CV0647-11
Guam Telephone Authority (GTA) and created a competitive regulatory market for 2 the provision of telecommunication services on Guam. 12 G.C.A. § 12101. In August 3 2007, the General Services Agency ("GSA") issued a three year competitive 4 procurement request for the provision of various communications services for the 5 line agencies of Guam and GSA announced the contract winner in July October 6 2007. However, telephone services were not included in this procurement and GTA
7 remained the sole provider of such services to the line agencies of Guam. In July
8 2008, PDS became eligible to sell telephone services on Guam and to compete with
9 GTA for the provision of these services to the line agencies of the Government of Guam. Despite PDS's desire and ability to compete with GTA, Defendant Acfalle 10 and GSA did not issue a request for procurement of telephone services for the 11 Government's line agencies until October 1, 2009. GSA cancelled that procurement 12 on December 29, 2009, prior to bid submission. GSA issued another request for 13 procurement for telephone services on March 19, 2010, which GSA again cancelled 14 prior to bid submission. On June 22, 2011, GSA issued IFB GSA-064-11, the most 15 recent and final invitation for the procurement of telecommunication services for 16 the line agencies of the Government of Guam. 17 Plaintiffs PDS and John Day filed this Action on April 8, 2011. Plaintiffs 18 allege that Defendant Acfalle failed to exercise her duties as Chief Procurement 19 Officer in accordance with Guam's procurement laws and seek to hold Defendant 20 Acfalle personally liable for excess funds that Plaintiffs allege were spent by the 21 Government of Guam as a result of GSA's failure to timely engage the competitive 22 procurement process. Defendants answered the complaint on June 7, 2011. On 23 October 28, 2011, Defendant Acfalle filed the present motion to dismiss asserting 24 lack of subject matter jurisdiction under Guam Rule of Civil Procedure 12(b)(1). 25 Defendant Acfalle argues that she acted reasonably in executing her official duties
26 with respect to the provision of telephone services and is entitled to qualified
27 immunity from Plaintiffs' claims seeking to hold her individually liable. This Court
28 finds that, as a matter of law, qualified immunity does not apply in this instance, and therefore Defendant Acfalle's motion must be denied.
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DISCUSSION 2 Defendant Acfalle moves this court to dismiss the action against her for lack 3 of subject matter jurisdiction under Guam Rule of Civil Procedure 12(b)(1). A 4 motion to dismiss under GRCP 12(b)(1) must "be made before pleading, if a further 5 pleading is permitted." GRCP 12(b). Although a motion to dismiss is not proper once 6 responsive pleadings have been filed, the rules of procedure do allow for the filing of 7 other dispositive motions prior to trial. Rule 12(c) provides:
8 [a]fter the pleadings are closed but within such time as not to delay the 9 trial, any party may move for judgment on the pleadings. If, on a motion for judgment on the pleadings, matters outside the pleadings 10 are presented to and not excluded by the court, the motion shall be II treated as one for summary judgment and disposed of as provided in Rule 56, and all parties shall be given reasonable opportunity to 12 present all material made pertinent to such motion by Rule 56. 13 GRCP 12(c). Defendant Acfalle filed the present motion to dismiss well after filing 14 her answer in this case. Furthermore, Defendant Acfalle presented numerous 15 exhibits outside the pleadings. Plaintiffs also presented additional evidence outside 16 the pleadings and urged this Court to treat the motion as one for summary 17 judgment. Defendant Acfalle filed a reply to Plaintiffs' opposition. Given the timing 18 of Defendant Acfalle's motion and the matters presented, this Court will treat the 19 motion as a motion for summary judgment pursuant to Rule 56. 20 Summary judgment is granted when there is no genuine issue of material 21 fact, making the moving party entitled to judgment as a matter oflaw. GRCP 56(c). 22 A genuine issue exists when sufficient evidence establishes a factual dispute
23 requiring resolution by a fact-finder. Iizuka Corp. v. Kawasho Int'l, Inc., 1997 Guam
24 10 ~ 7; T. W Elec. Serv., Inc. v. Pacific Elec. Contractors Ass'n., 809 F.2d 626, 630
25 (9th Cir. 1987). The materiality of a fact is determined by the governing substantive law. If the fact may affect the outcome, it is material. Edwards Corp. V. Kawasho 26 Int'l, Inc., 2000 Guam 27 ~ 7. On a motion for summary judgment, inferences are 27 drawn and the evidence is viewed in the light most favorable to the non-moving 28 party.Id.
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Defendant Acfalle bases her argument for dismissal-or, rather, summary 2 judgment-on the affirmative defense of qualified immunity. A party must 3 generally plead any affirmative defense in the party's answer. GRCP 8(c). Here, 4 Defendant Acfalle's Answer did not raise a qualified immunity defense. However, 5 even where a party fails to timely assert their defense, courts have considered an 6 immunity defense where it is raised prior to trial and where there is no showing of
7 prejudice. See Camarillo v. McCarthy, 998 F.2d 638, 639 (9th Cir.1993). As
8 Plaintiffs have not alleged any prejudice resulting from the delay and as there
9 appears to be none, this Court addresses the applicability of Defendant Acfalle's qualified immunity defense in this case. 10 Qualified immunity, which operates as an immunity from suit rather than a 11 mere defense to liability, Mitchel v. Forsyth, 472 U.S. 511, 526, is a common law 12 doctrine that shields public officials from civil damages for tortious acts that arise 13 during the performance of discretionary functions. See Restatement (Second) of 14 Torts § 895D (1979). "The applicability and scope of official immunity is a question 15 of law .... " Weed v. Bachner Co. Inc., 230 P.3d 697, 699 (Alaska 2010).
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L\brary
4 IN THE SUPERIOR COURT OF GUAM 5
6 PACIFIC DATA SYSTEMS, INC., and) CASE NO. CV0647-11 7 JOHN DAY, ) Plaintiffs, ) DECISION AND ORDER 8 vs. ) ) 9 GOVERNMENT OF GUAM, and ) 10 CLAUDIA ACFALLE, personally and in) her capacity as Chief Procurement ) 11 Officer for the Government of Guam, ) 12 ) Defendants. ) 13
14 INTRODUCTION 15 This matter came before the Honorable Alberto C. Lamorena IlIon 16 Defendant Claudia Acfalle's Motion to Dismiss. Attorney Fred Nishihira 17 represented Defendant Acfalle. Attorney Bill R. Mann represented Plaintiffs, Pacific 18 Data Systems, Inc. ("PDS") and John Day. Following a hearing on this matter the 19 Court took the motion under advisement. The Court now issues its Decision and 20 Order. 21 FACTUAL HISTORY 22 This Case involves a taxpayer lawsuit for the enforcement of proper 23 government spending by Defendant Acfalle. Defendant Acfalle is the Chief 24 Procurement Officer for the Government of Guam and is charged by law with 25 "procuring or supervising the procurement of all supplies and services needed by 26 the Territory." 5 Guam Code Ann. § 5113(c)(1)(i). Plaintiff PDS is a 27 telecommunications provider licensed to do business on Guam. In 2004, the Guam 28 Legislature passed the Guam Telecommunications Act of 2004, which privatized the Decision and Order Case No. CV0647-11
Guam Telephone Authority (GTA) and created a competitive regulatory market for 2 the provision of telecommunication services on Guam. 12 G.C.A. § 12101. In August 3 2007, the General Services Agency ("GSA") issued a three year competitive 4 procurement request for the provision of various communications services for the 5 line agencies of Guam and GSA announced the contract winner in July October 6 2007. However, telephone services were not included in this procurement and GTA
7 remained the sole provider of such services to the line agencies of Guam. In July
8 2008, PDS became eligible to sell telephone services on Guam and to compete with
9 GTA for the provision of these services to the line agencies of the Government of Guam. Despite PDS's desire and ability to compete with GTA, Defendant Acfalle 10 and GSA did not issue a request for procurement of telephone services for the 11 Government's line agencies until October 1, 2009. GSA cancelled that procurement 12 on December 29, 2009, prior to bid submission. GSA issued another request for 13 procurement for telephone services on March 19, 2010, which GSA again cancelled 14 prior to bid submission. On June 22, 2011, GSA issued IFB GSA-064-11, the most 15 recent and final invitation for the procurement of telecommunication services for 16 the line agencies of the Government of Guam. 17 Plaintiffs PDS and John Day filed this Action on April 8, 2011. Plaintiffs 18 allege that Defendant Acfalle failed to exercise her duties as Chief Procurement 19 Officer in accordance with Guam's procurement laws and seek to hold Defendant 20 Acfalle personally liable for excess funds that Plaintiffs allege were spent by the 21 Government of Guam as a result of GSA's failure to timely engage the competitive 22 procurement process. Defendants answered the complaint on June 7, 2011. On 23 October 28, 2011, Defendant Acfalle filed the present motion to dismiss asserting 24 lack of subject matter jurisdiction under Guam Rule of Civil Procedure 12(b)(1). 25 Defendant Acfalle argues that she acted reasonably in executing her official duties
26 with respect to the provision of telephone services and is entitled to qualified
27 immunity from Plaintiffs' claims seeking to hold her individually liable. This Court
28 finds that, as a matter of law, qualified immunity does not apply in this instance, and therefore Defendant Acfalle's motion must be denied.
-2- Decision and Order Case No. CV0647-11
DISCUSSION 2 Defendant Acfalle moves this court to dismiss the action against her for lack 3 of subject matter jurisdiction under Guam Rule of Civil Procedure 12(b)(1). A 4 motion to dismiss under GRCP 12(b)(1) must "be made before pleading, if a further 5 pleading is permitted." GRCP 12(b). Although a motion to dismiss is not proper once 6 responsive pleadings have been filed, the rules of procedure do allow for the filing of 7 other dispositive motions prior to trial. Rule 12(c) provides:
8 [a]fter the pleadings are closed but within such time as not to delay the 9 trial, any party may move for judgment on the pleadings. If, on a motion for judgment on the pleadings, matters outside the pleadings 10 are presented to and not excluded by the court, the motion shall be II treated as one for summary judgment and disposed of as provided in Rule 56, and all parties shall be given reasonable opportunity to 12 present all material made pertinent to such motion by Rule 56. 13 GRCP 12(c). Defendant Acfalle filed the present motion to dismiss well after filing 14 her answer in this case. Furthermore, Defendant Acfalle presented numerous 15 exhibits outside the pleadings. Plaintiffs also presented additional evidence outside 16 the pleadings and urged this Court to treat the motion as one for summary 17 judgment. Defendant Acfalle filed a reply to Plaintiffs' opposition. Given the timing 18 of Defendant Acfalle's motion and the matters presented, this Court will treat the 19 motion as a motion for summary judgment pursuant to Rule 56. 20 Summary judgment is granted when there is no genuine issue of material 21 fact, making the moving party entitled to judgment as a matter oflaw. GRCP 56(c). 22 A genuine issue exists when sufficient evidence establishes a factual dispute
23 requiring resolution by a fact-finder. Iizuka Corp. v. Kawasho Int'l, Inc., 1997 Guam
24 10 ~ 7; T. W Elec. Serv., Inc. v. Pacific Elec. Contractors Ass'n., 809 F.2d 626, 630
25 (9th Cir. 1987). The materiality of a fact is determined by the governing substantive law. If the fact may affect the outcome, it is material. Edwards Corp. V. Kawasho 26 Int'l, Inc., 2000 Guam 27 ~ 7. On a motion for summary judgment, inferences are 27 drawn and the evidence is viewed in the light most favorable to the non-moving 28 party.Id.
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Defendant Acfalle bases her argument for dismissal-or, rather, summary 2 judgment-on the affirmative defense of qualified immunity. A party must 3 generally plead any affirmative defense in the party's answer. GRCP 8(c). Here, 4 Defendant Acfalle's Answer did not raise a qualified immunity defense. However, 5 even where a party fails to timely assert their defense, courts have considered an 6 immunity defense where it is raised prior to trial and where there is no showing of
7 prejudice. See Camarillo v. McCarthy, 998 F.2d 638, 639 (9th Cir.1993). As
8 Plaintiffs have not alleged any prejudice resulting from the delay and as there
9 appears to be none, this Court addresses the applicability of Defendant Acfalle's qualified immunity defense in this case. 10 Qualified immunity, which operates as an immunity from suit rather than a 11 mere defense to liability, Mitchel v. Forsyth, 472 U.S. 511, 526, is a common law 12 doctrine that shields public officials from civil damages for tortious acts that arise 13 during the performance of discretionary functions. See Restatement (Second) of 14 Torts § 895D (1979). "The applicability and scope of official immunity is a question 15 of law .... " Weed v. Bachner Co. Inc., 230 P.3d 697, 699 (Alaska 2010). "[P]ersonal 16 common-law immunities-which Congress can lawfully override if it chooses to do 17 so-must bend to the congressional will." In re Perry, 882 F.2d 534, 543 (1st Cir. 18 1989). Thus, like other common law principles, the doctrine of qualified immunity 19 may be abrogated by statute, but only if the statute "speaks directly to the question 20 addressed by the common law." United States v. Texas, 507 U.S. 529, 534, 113 S. Ct. 21 1631, 1634, 123 L. Ed. 2d 245 (1993) (citing Mobil Oil Corp. v. Higginbotham, 22 supra, 436 U.S., at 625, 98 S.Ct., at 2015; Milwaukee v. Illinois, 451 U.S. 304, 315, 23 101 S.Ct. 1784, 1791, 68 L.Ed.2d 114 (1981». "[W]hile Congressional intent need 24 not be unmistakably clear, there must be sufficient evidence in the statute or 25 legislative history to show a specific 'clear legislative intent' to waive immunity."
26 Chappell v. Robbins, 73 F.3d 918, 923 (9th Cir. 1996) (citations omitted).
27 In this case, the Guam Legislature has shown clear intent to waive qualified
28 immunity for government officials with respect to instances of improper government spending. Title 5, section 7103 of the Guam Code provides:
-4- Decision and Order Case No. CV0647-11
§ 7103. Taxpayer Standing to Sue. 2 Any taxpayer who is a resident of Guam shall have standing to sue the 3 government of Guam and any officer, agent, contractor, or employee of the Executive Branch of the Government of Guam for the purpose of 4 enjoining any officer, agent, contractor, or employee of the Executive 5 Branch of the government of Guam from expending money without proper appropriation, without proper authority, illegally, or contrary to 6 law, and to obtain a personal judgment in the courts of Guam against 7 such officers, agents, contractors, or employees of the Government of Guam and in favor of the Government of Guam for the return to the 8 Government of Guam of any money which has been expended without 9 proper appropriation, without proper authority, illegally, or contrary to law. 10 5 GCA § 7103 (emphasis added). Moreover, the Legislature also provided for 11 the collection of any personal judgment obtained against an officer or 12 employee of the executive branch under section 7103: 13
14 § 7110. Limits on Garnishment. 15 One half of any salary or remuneration due to any agent, officer, 16 contractor, or employee of the government of Guam who has a judgment against him pursuant to this statute shall be deducted from 17 any payor other sums due such individual, until the judgment 18 obtained under this Chapter is fully paid. If any federal law prohibits the deduction as herein mandated, then the deduction shall be such 19 lesser amount as allowed by federal law. 20 5 GCA § 7110. These statutes, which allow for a taxpayer action to obtain and 21 collect upon a personal judgment against a government official for improper 22 government spending indicate a clear legislative intent to waive any qualified 23 immunity that would otherwise apply to Government of Guam officials. As such, 24 Defendant Acfalle is precluded, as a matter of law, from asserting the affirmative 25 defense of qualified immunity in this case. 26 Moreover, Plaintiffs have established issues of material fact with regard to 27 Defendant Acfalle's liability. Plaintiffs here have alleged that Defendant Acfalle 28 failed to solicit competitive bids in accordance with Guam's Procurement Law-
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Title 5, Chapter 5 of the Guam Code-for the procurement of telephone services to 2 the line agencies of the Government of Guam. Plaintiffs further allege that this 3 failure resulted in improper government spending under section 7103. (Pl.'s 4 Complain, p. 2-4) In support of their claims, Plaintiffs offer a declaration by John
5 Day, President of PDS, showing that PDS was willing and able to provide
6 competition to GTA for telephone services on Guam for more than one year before
7 GSA and Defendant Acfalle solicited competitive bids to procure such services for the government's line agencies. (Decl. of John Day, Pl.'s Opp. Exh. A, p. 2) Plaintiffs 8 also offer testimony that the competitive procurement process would result in 9 substantial government savings. (Depo. Trans. of Norman H. Okamura, Pl.'s Opp., 10 Exh. B, p. 38) Construing Plaintiffs' allegations and evidence liberally, as this Court 11 must on a motion for summary judgment, Plaintiffs have put forth sufficient 12 evidence to show a material issue of fact as to whether Defendant Acfalle violated 13 her duties as Chief Procurement Officer and whether these violations constituted 14 improper government spending under title 5, section 7103. As Defendant Acfalle is 15 not entitled to immunity from this action, and as Plaintiffs offer sufficient evidence 16 showing a dispute regarding the material fact as to whether Defendant Acfalle's 17 procurement delays constituted a violation of Guam's procurement law, Defendant 18 Acfalle is not entitled to summary judgment. 19
20 CONCLUSION
21 Based on the foregoing, Defendant Acfalle's motion IS hereby DENIED. A 22 Scheduling Conference is set for September 10, 2012 at 2:00 p.m. 23
24 It is SO ORDERED this 27th day of July, 2 12. 25
27 ORENAIII 28
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