Shinault v. Hawks

A state must provide an inmate a pre-deprivation hearing before transferring a substantial amount of money from the inmate's trust account.

Lester Shinault was incarcerated with the Oregon Department of Corrections (“ODOC”) for almost three years between 2005 and 2009 for two separate felony convictions. While incarcerated the second time, Shinault received a settlement for over $100,000 from a drug manufacturer whose product led him to develop diabetes. The settlement money was deposited in Shinault’s inmate trust account. Oregon law allows for the State to recover incarceration costs from inmates. After Shinault’s money was deposited into his account, ODOC issued an order for Shinault to pay the costs of both of his incarcerations, totaling over $65,000, which was transferred into a subaccount in his name. Shinault requested a case hearing to contest the transfer. The Administrative Law Judge reduced the reimbursement to $61,000. Shinault, without appealing the order, brought this suit against ODOC for violation of his Fourteenth and Eighth Amendment rights by transferring the money into the separate account before the administrative hearing. The Ninth Circuit found that under the Mathews v. Eldridge test, the State was required to provide Shinault a pre-deprivation hearing before the money was transferred out of his inmate trust account because: 1) inmates have a substantial interest in their money before the transfer; 2) there is a risk that the amount calculated will be erroneous; and, 3) because the State has control of the money before the transfer, the State providing a hearing will not compromise the State’s interest. The panel, nevertheless, found that state officials were shielded by qualified immunity because at the time of the transfer Shinault did not have a clearly established right. The panel also denied Shinault’s Eighth Amendment claim because Shinault was given adequate medical care while incarcerated and the transfer will not impede his ability to receive future medical treatment. AFFIRMED.