From the New York Times:

A Supreme Court Setback for Whistle-Blowers
By LINDA GREENHOUSE

Published: May 31, 2006

WASHINGTON, May 30 — The Supreme Court ruled on Tuesday that the Constitution does not protect public employees against retaliation by their supervisors for anything they say in the course of performing their assigned duties.

While the court's focus in the 5-to-4 decision was on disputes that remain within the workplace, the decision raised questions about the extent to which whistle-blowers who make their complaints public might now face a greater danger of retaliation.

Although several employee groups raised immediate alarms, Justice Anthony M. Kennedy's majority opinion in fact contained the counterintuitive implication that employees might fare better by speaking out as "citizens" and taking their complaints to the public rather than keeping them within the official chain of command.

The likely impact of the ruling was therefore far from clear. The court raised several questions that it did not answer, instead sending the case back to the lower federal courts in California, where it began as a suit by an assistant prosecutor in Los Angeles who claimed he was the victim of unconstitutional retaliation for complaints about a search warrant.

The National Whistleblower Center and other groups representing public employees issued statements deploring the decision and warning that it would deter employees from taking risks to expose waste and fraud.

But Daniel P. Westman, a lawyer with the firm of Morrison & Foerster who advises employers on whistle-blower issues, said in an interview that the decision did little more than affirm the status quo by "rejecting a very overreaching opinion" by a federal appeals court. He said "smart employers" would now be sure to encourage the use of internal complaint mechanisms to deter employees from taking their complaints public and thus enjoying the prospect of greater constitutional protection.

Justice Kennedy's opinion drew a formal distinction between two kinds of speech by public employees: statements they make "pursuant to their official duties" and those made as citizens contributing to "the civic discourse." The first category was not protected by the First Amendment's guarantee of free speech, Justice Kennedy said, while the second retained "the prospect of constitutional protection."

The dissenting justices warned that this distinction would often be unclear in practice and difficult for lower courts to apply.

"The notion that there is a categorical difference between speaking as a citizen and speaking in the course of one's employment is quite wrong," Justice John Paul Stevens said in a dissenting opinion.

The other dissenters were Justices David H. Souter, Stephen G. Breyer and Ruth Bader Ginsburg.

Chief Justice John G. Roberts Jr. joined the majority opinion, as did Justices Antonin Scalia, Clarence Thomas and Samuel A. Alito Jr. Justice Alito was not on the court when the case, Garcetti v. Ceballos, No. 04-473, was argued last October. The case had not been decided by the time Justice Sandra Day O'Connor retired and Justice Alito took his seat in January.

When the court ordered a second argument, held on March 21, the implication was that the eight remaining justices who had heard the case the first time were deadlocked and that Justice Alito would break the tie. The reality may have been more complex.

Justice Breyer made it clear in his separate dissenting opinion that he was satisfied with neither Justice Kennedy's majority opinion nor Justice Souter's principal opinion for the other three dissenters, and his vote may have been uncertain until late in the process. Justice Breyer would have emphasized the fact that as a lawyer, the plaintiff, Richard Ceballos, had special ethical obligations to speak up if he found problems with a pending prosecution and so deserved special constitutional protections.

In his lawsuit, Mr. Ceballos claimed that he was given an unwelcome transfer and was denied a promotion after taking several steps to complain about the apparent unreliability of an affidavit that had provided the basis for a search warrant in a case the office was prosecuting. He told his supervisors of his concerns, and wrote a memorandum recommending dismissal of the case. There was a heated meeting, after which his concerns were rejected.

Mr. Ceballos later testified for the defense at a court hearing, and spoke about the issue at a meeting of the Mexican American Bar Association.

The Supreme Court's focus, however, was entirely on the initial internal memorandum because the United States Court of Appeals for the Ninth Circuit, in ruling for Mr. Ceballos, found that the document was constitutionally protected speech and did not then go on to consider the constitutional status of his other actions.

In overturning the Ninth Circuit's judgment, Justice Kennedy's opinion said that in writing the memorandum, Mr. Ceballos was simply carrying out the normal duties of his job, which included advising his supervisors on how to proceed with pending cases.

"We hold that when public employees make statements pursuant to their official duties," Justice Kennedy said, "the employees are not speaking as citizens for First Amendment purposes, and the Constitution does not insulate their communications from employer discipline."

To hold otherwise, he continued, would be to give employees "a right to perform their jobs however they see fit," as a matter of constitutional law. It would "commit state and federal courts to a new, permanent and intrusive role" of overseeing internal communications in government workplaces, the justice concluded.

The lower courts will now consider whether Mr. Ceballos was performing his normal duties when he testified at the hearing and spoke to the bar association. Justice Souter, in his dissenting opinion, said that these were not obviously part of the prosecutor's normal duties and that they needed to be analyzed independently.

If they are found to be "citizen" speech, under the dichotomy the court established, these comments will be analyzed under a 1968 Supreme Court precedent that set up a balancing test for whether a public employee's speech is constitutionally protected. Courts weigh the employee's interest in commenting on matters of public concern against the employer's interests as a manager.