                        Revised March 15, 2000

                   UNITED STATES COURT OF APPEALS
                        FOR THE FIFTH CIRCUIT


                              No. 98-10638


                   ALLEN BREAUX AND JOE AMBROGIO,

                                     Plaintiffs-Appellees/Appellants,

                                   v.

                       CITY OF GARLAND, ET AL,

                                                            Defendants,

                           CITY OF GARLAND,

                                                    Defendant-Appellee,

                   TERRY HENSLEY AND RON HOLIFIELD

                                                Defendants-Appellants.



      Appeals from the United States District Court for the
                    Northern District of Texas


                           February 23, 2000

Before JONES and WIENER, Circuit Judges, and WALTER*, District
Judge.

EDITH H. JONES, Circuit Judge:




       *
           District Judge of the Western District of Louisiana, sitting by
designation.
           This case involves the First Amendment retaliation claims

of two police officers against the City of Garland (“City”), its

former Police Chief, and its former City Manager.                    Officers Allen

Breaux and Joe Ambrogio (the “Plaintiffs”) argue that Terry Hensley

and Ron Holifield (the “individual Defendants”), and later the

City,   violated   42    U.S.C.    §   1983        by   retaliating     against   the

Plaintiffs for making public allegations of corruption in the

Garland Police Department.

           The jury found the individual Defendants liable, and even

after a large remittitur was accepted by the Plaintiffs, the

district   court   entered       judgment          exceeding    $8   million,     plus

attorneys’ fees, for the Plaintiffs.                    Both sides have appealed.

We   conclude   that    the    judgment       is    fatally    flawed   because   the

Plaintiffs failed to prove that official retaliation against them

was sufficiently serious to constitute a constitutional injury. No

other reversible error has been raised.

                          I.    FACTUAL BACKGROUND

           This case is factually complex, as evidenced by the

parties’ continuing disagreement about what happened in the City of

Garland and the Garland Police Department between 1992 and 1994.

The following review of the facts is guided by the jury verdict

favoring Breaux and Ambrogio.          In the beginning of 1992, the City

hired Holifield as its City Manager.                    The Garland City Council

instructed Holifield to hire a new police chief from outside the



                                          2
department.        Holifield     ultimately   hired       Hensley,   who   started

working for the City in April 1992.                During the summer of 1992,

Hensley contacted the FBI’s Dallas office to discuss possible land

acquisitions and flips made by members of the City administration.

            In October 1992, Hensley met FBI Agent Largent, the

supervisor of the white collar crime squad for public corruption,

to discuss the land deals over lunch.                Two other Garland police

officers, Jody Lay (“Lay”) and Larry Wilson (“Wilson”), were

present at this meeting.         During the conversation, it became clear

that the FBI was beginning to investigate the possible involvement

of some current and former council members in two City of Garland

real estate transactions.         According to Wilson, Hensley conducted

the meeting and told the FBI agent who and what Hensley wanted

investigated.       The subjects included former Garland mayor Billy

Earl Tomlinson (“Tomlinson”); former City Councilman James Ratliff

(“Ratliff”); and Garland Councilman Vernon Gaston (“Gaston”).1 Lay

continued to assist the FBI until late 1992 when Officer Joe Harn

(“Harn”)    took    over   for    Lay.       The    FBI    initiated   a    second

investigation concerning possible Garland public corruption in

relation to a landfill deal between the City and Waste Management,


     1
             According to the Plaintiffs, Ratliff, Gaston, and Tomlinson were all
close friends and political allies. Wilson was also a good friend of Tomlinson.
The Plaintiffs contend that Hensley instructed the FBI to investigate these
individuals because they were “political enemies” of Hensley. The Plaintiffs
also assert that Holifield played a significant role in the FBI investigation by
acting as a “confidential informant” for the FBI. Holifield participated in the
investigation at the request of the FBI, before he made the statements that serve
as the basis for the Plaintiffs’ § 1983 claim.

                                         3
Inc., which was allegedly brokered by Ratliff and Gaston.

            During the summer of 1992, Hensley put Lay in charge of

the Intelligence Unit of the Department.          Hensley told Lay that he

was concerned about the current direction of the Unit as well as

the performance of the two officers in the Unit.                 Hensley was

particularly concerned with Breaux, who Hensley thought devoted too

much of his time to Asian gangs.             Lay apparently shared these

concerns; in a September 11, 1992, memo to Hensley, Lay requested

that Breaux be transferred out of the Intelligence Unit.

            Breaux was then a 20-year veteran officer.                Officer

Breaux testified that he asked to be transferred back to patrol

duty after Lay informed him, during a truck ride in the country,

that Hensley and Lay “were redirectionalizing the Intelligence Unit

to start doing political investigations for Charlie Hinton, the

city attorney, and members of the city council.”2                 Breaux was

unwilling to engage in “political investigations” instituted by the

new police chief.      Although Breaux contemporaneously reported his

conversation with Lay to Lieutenant David Swavey, he did not

otherwise pursue the matter.

            After being transferred out of the Intelligence Unit,

Breaux remained on patrol duty until late 1993.           In November 1993,

Breaux received a poor performance review from his supervisor and


    2
            Lay contends that he went with Breaux to discuss Lay’s recommendation
in the memo. Lay maintains that during the ride he said only that the Unit would
handle “high level ‘public corruption’ cases;” Lay denies any discussion of
political investigations.

                                       4
was assigned to front desk duty at the Department.3

            In the Spring of 1994, Officer Breaux, newly-elected

vice-president of the Garland Police Officers Association (“GPOA”),

told Detective Ambrogio, the GPOA president, about the previous

attempt to recruit him for political investigations.                   Shortly

thereafter, the GPOA conducted a survey of all Department employees

to identify morale problems and to determine how to overcome any

such problems.       Upon learning of the survey, Chief Hensley became

very upset and upbraided Ambrogio about it.

            In March 1994, Holifield met with the GPOA Board to

discuss the survey.         During this meeting, Breaux first revealed to

the City Manager the alleged illegal political investigations being

run by Chief Hensley.        Breaux also told Holifield that the station

was wired so that a former police chief could monitor any telephone

conversation    in    the    building.       The   GPOA   Board   members   were

concerned that someone might try to monitor their calls after the

results of the survey were published.              After Breaux mentioned the

alleged investigations, Holifield immediately ordered that any

ongoing investigations were to remain confidential. Holifield also

expressed his concern with GPOA tactics and allegedly threatened to

“destroy” the GPOA if it acted “politically” with respect to these

allegations or the survey results.            But Holifield offered to work



    3
            Breaux’s supervisor reported that Breaux would not adequately enforce
traffic laws because Breaux questioned the legality of (1) requiring people to
have driver’s licenses and (2) confiscating weapons.

                                         5
with       the    GPOA      if   the   GPOA   would     keep     politics    out     of   the

Department.           With the apparent approval of Breaux and Ambrogio,

Holifield agreed to investigate the GPOA allegations.                            Toward this

end, Holifield reported the allegations to Hensley.

                 At this point, the retaliation began.                Hensley informed

Lay of the allegations of politically motivated investigations, and

Hensley brought an Internal Affairs charge, investigation I/A 94-

12, against           Breaux     for   making       false    statements     --    about    the

investigations.

                 Soon    thereafter,      Holifield         discovered    that     film    was

missing from a secret camera, which had been installed in his

office      to    catch      suspected       intruders.         Realizing    that    police

officers would recognize the hidden camera and knowing that the

GPOA Board had been in his office for the March 1994 meeting,

Holifield told Hensley about the missing film.                       Hensley initiated

Internal Affairs investigation I/A 94-13 against all the GPOA Board

members to determine if they had stolen the film.4

                 Detective Ambrogio, on the advice of a lawyer from the

Combined Law Enforcement Association of Texas (“CLEAT”), then held

a press conference, where he, the lawyer, and a City Councilman who

was    one       of   the    targets    of    the     alleged    investigations,          made

       4
            After the March 1994 meeting in Holifield’s office, Gaston admitted
that someone had told him about the hidden camera, but Gaston refused to identify
who it was. The investigation of all the officers present was narrowed to an
investigation of Ambrogio for interfering with an investigation and revealing
confidential information. Although the ensuing investigation failed to determine
who stole the film, Ambrogio later admitted that he had made the unauthorized
disclosure to Gaston.

                                                6
expansive allegations about illegal political investigations being

conducted by Hensley and Holifield.5        Relying on statements made by

Breaux during the meeting in Holifield’s office, Ambrogio and the

others also alleged that the Department was conducting electronic

surveillance of its employees since the phones in the Department

were bugged.      The CLEAT attorney, Bob Hasty, went so far as to

inquire whether there is “in fact, a Gestapo type of ... secret

intelligence organization that is doing political investigations of

police officers.”6      Hasty further propagated Breaux’s allegations

in letters to law enforcement authorities in the state.                  These

public statements led to another Internal Affairs investigation,

I/A 94-14, which focused on Ambrogio’s possible violation of

several General Orders of the police department.               Investigators

recommended that the charges in 94-14 be sustained and the Chain of

Command Board agreed.

            As part of the investigations, Breaux and Ambrogio were

both questioned on several occasions, and Breaux was required to

take a polygraph administered by the Department.                The Internal

Affairs investigations concluded that Breaux and Ambrogio had lied



    5
            Ambrogio first received notice that he would be questioned in I/A 94-
13 on April 18, 1994. After consulting with the CLEAT attorney, Ambrogio called
the GPOA press conference on April 20, 1994.
    6
            During the press conference, CLEAT and the GPOA requested an external
investigation into the Department’s activities. The Texas Rangers investigated
Hensley’s conduct in May 1994 and reported “a complete lack of evidence of
wrongdoing on the part of Chief Hensley or his staff.”       At the request of
Ratliff, the FBI also investigated Hensley’s conduct. The FBI reached the same
conclusion as the Texas Rangers.

                                       7
in making their allegations of corruption. Hensley publicly posted

the results of the investigations in the Department and made the

results available to several local media outlets, leading everyone

in the department to know the Plaintiffs were “in trouble.”                 Breaux

was also required to undergo a psychiatric exam following comments

he made to another officer while en route to the Department

polygraph test.7

           Following       the   various   interviews,     Internal     Affairs

investigations,      and    polygraphs,    Breaux    was   placed      on     paid

administrative leave.       In May 1994, Hensley called each Plaintiff

into his office separately, telling each that he could keep his job

if he accepted a short suspension and signed a letter, the terms of

which   were   to   be   mutually   agreed   to,    retracting   all    of     his

allegations.     Both men refused the agreement offered by Hensley.

Hensley took no further action with respect to Breaux and Ambrogio.

           Later in May, Ratliff was elected mayor of Garland.                  An

ally of those whom Hensley had been investigating, Ratliff caused

both Chief Hensley and City Manager Holifield to resign.                    In the

few months following Hensley’s resignation, the new Acting Police

Chief Barnett “non-sustained” the Internal Affairs charges against

Breaux and Ambrogio.       Nevertheless, after returning from his paid

administrative leave in July 1994, Breaux was assigned to the

Telephone Response Unit (“TRU”).           Breaux contends that Lay was a

      7
            Breaux told the officer that Breaux was surprised that someone had
not already shot an Internal Affairs investigator between the eyes.

                                       8
friend of Barnett’s and that Barnett thought Breaux should be

punished with this assignment.         (According to the City, Breaux was

assigned to the TRU, a position similar to the one he had at the

front desk, in order to accommodate his shift preferences.) Breaux

subsequently wrote to Barnett complaining about his assignment to

the TRU and requesting a transfer back to patrol duty.                      Chief

Barnett granted Breaux’s request, and Breaux returned to patrol

duty in November 1994.

           Neither Breaux nor Ambrogio suffered a reduction in pay.

Both remain employed by the City of Garland.

                        II.   PROCEDURAL HISTORY

           In October 1994, Breaux and Ambrogio filed suit against

the City, Holifield, and Hensley alleging that the defendants were

liable under    42   U.S.C.   §   1983     for   violating    the    Plaintiffs’

constitutional rights to free speech and free association.                 Breaux

also alleged that the City violated the Texas Whistleblower Act,

Tex. Gov’t Code Ann. § 544.001, et seq., by retaliating against him

for reporting wrongdoing involving Holifield and Hensley. The case

was removed from state to federal court.

           Responding to serial motions for summary judgment by the

City, the district court first held that the statute of limitations

barred all of the Whistleblower Act claims except for Breaux’s

claim   that   his   assignment   to       the   TRU   in   July    1994   was   in

retaliation    for   reporting    possible        political    investigations.



                                       9
Later,   the   district    court   granted   summary    judgment    on   the

Plaintiffs’ § 1983 claim against the City on the ground that

Hensley and Holifield did not have “final policy-making authority”

for the City with respect to “police officer employment decisions.”

            After a seven-day trial, the jury found Hensley and

Holifield individually liable under § 1983, ordering actual damages

against each defendant for each Plaintiff in amounts exceeding a

half million dollars.      Each individual Defendant was also ordered

to pay $5,000,000 in punitive damages to each Plaintiff.           The City

was found liable to Breaux under the Whistleblower Act for $527,500

in actual damages and $5,000,000 in punitive damages.           The total

award to both Plaintiffs amounted to $27,707,012.

            The court entered judgment on the verdict but then

responded to various post-judgment motions.            The district court

granted the City’s Motion for Judgment as a Matter of Law on the

Whistleblower Act claim, holding that Breaux had failed to exhaust

his administrative remedies.       The court also found that the jury’s

findings of lost earning capacity and part of the award to Breaux

for lost past income were not supported by the evidence.           The court

accordingly reduced the actual damages, proportionally reduced the

punitive damages, and required a remittitur from the Plaintiffs.

The Plaintiffs accepted the remittitur.         As a result, Breaux and

Ambrogio were awarded, jointly and severally from the Defendants,

$6,258.75   and   $2,256   respectively   for   past   lost   income,    and

severally from each defendant $150,000 for lost reputation, $50,000

                                    10
for mental anguish, and $2,000,000 as punitive damages.                The

Amended Judgment dismissed Plaintiffs’ claims against the City with

prejudice and awarded total damages in the amount of $4,406,258.75

to Breaux and $4,402,256 to Ambrogio, plus post-judgment interest,

reasonable attorneys’ fees, and expenses and costs.

           Hensley and Holifield contend on appeal that (1) the

Plaintiffs’ speech is false or reckless as to its truth or falsity

and therefore not constitutionally protected (or at least they

reasonably could have believed it was unprotected), (2) neither

Plaintiff suffered an adverse employment action, and (3) the

damages are excessive. Breaux contends on cross-appeal that he did

properly exhaust his administrative remedies as required by the

Whistleblower Act.8

                             III.   ANALYSIS

A.   Chief Hensley

           The jury was persuaded that Breaux and Ambrogio became

the objects of a vendetta by Chief Hensley and City Manager

Holifield, once they blew the whistle on politically-motivated

investigations of Garland City Council members by the City’s top

employees.    No doubt the jury was powerfully influenced by the

corroborating testimony of Wilson and Ratliff, who (in the wake of

the officers’ allegations) had become Chief of Police and Mayor,


     8
           Other issues have been raised by the parties. We have considered
them and conclude they are either meritless or subsumed by the dispositive
issues.

                                    11
respectively.

            This finding is, however, not the end of the matter.              In

order to establish a constitutional claim for retaliation against

the exercise of one’s First Amendment rights, four elements must be

shown:

            First, the Plaintiffs must suffer an adverse
            employment decision. Second, the Plaintiffs’
            speech must involve a matter of public
            concern. Third, the Plaintiffs’ interest in
            commenting on matters of public concern must
            outweigh the Defendants’ interest in promoting
            efficiency.   Fourth, the Plaintiffs’ speech
            must have motivated the Defendants’ action.


Harris v. Victoria Indep. Sch. Dist., 168 F.3d 216, 220 (5th Cir.

1999) (citations omitted).

            A major dispute between the parties throughout this

litigation has persisted over whether Plaintiffs’ allegations of

corrupt political investigations by Hensley and Holifield were

false, and if so, whether false or reckless allegations merit First

Amendment protection.       This complaint is answered on one level by

the precise wording of the jury charge.           In arriving at a verdict

for the Plaintiffs, the jury was required by the court’s charge to

find the Plaintiffs’ allegations true.9


      9
            More problematic is that the court also submitted to the jury the
critical second and third elements of the retaliation claim. The second and
third elements of the test outlined above examine whether a public employee’s
speech deserves First Amendment protection by balancing the nature of the speech,
i.e. its relation to matters of public rather than purely personal concern,
against the need of government entities as employers to maintain a harmonious,
efficient workplace. Connick v. Myers, 461 U.S. 138, 103 S.Ct. 1684 (1983).
District courts in this circuit have been predisposed to submit claims in this
fashion, but, insofar as the second and third elements are questions of law, this

                                       12
           Hensley and Holifield nevertheless continue to label the

allegations    bogus   and   to    assert   that    false   allegations   of

corruption are constitutionally unprotected, but neither they nor

their opponents address what standard of review we must employ

concerning the jury verdict.         In this circuit, several opinions

refused to determine the standard of review because of uncertainty

as to whether First Amendment rights raise a legal question or a

mixed question of law and fact.           See Brady, 145 F.3d at 708 n.7

(citing cases).    In one recent case, however, this court cited a de

novo standard for First Amendment claims and then reversed a jury

verdict favoring retaliation plaintiffs.           Harrington, 118 F.3d at

365.   As Harrington assumed arguendo that plaintiffs’ speech was

entitled to First Amendment protection, the offhand invocation of

a de novo standard of review made no difference on that issue.

           Like its predecessors, this opinion will not have to

resolve the uncertainty over the standard of review, and the issue

may be deferred again for a future panel.             As in Harrington, we

assume arguendo that the evidence supports the jury’s finding that

the Plaintiffs reported truthful allegations of public corruption

in the police department.         Truthful allegations of such a nature




court has expressed its concern about the practice.    See Brady v. Fort Bend
County, 145 F.3d 691, 708 n.7 (5th Cir. 1998).

                                     13
implicate matters of public concern.10             The only question then

remaining is whether Officers Breaux and Ambrogio suffered adverse

employment actions after the March 1994 meeting with Holifield and

the subsequent press conference when they spoke out.11             Harrington,

118 F.3d at 365.12

            Fifth Circuit caselaw, some of which post-dates the trial

in   this   case,    is   inconsistent     with   Breaux’s   and   Ambrogio’s

contention    that    they    suffered     actionable   adverse    employment

actions.     “Adverse employment actions are discharges, demotions,

refusals to hire, refusals to promote, and reprimands.”              Pierce v.

Texas Dep’t of Criminal Justice, Institutional Div., 37 F.3d 1146,

1149 (5th Cir. 1994).        Transfers can constitute adverse employment


      10
            If the allegations of corruption are true, such allegations are
matters of public concern and outweigh the government’s interest in efficiency.
See Teague v. City of Flower Mound, 179 F.3d 377, 381 (5th Cir. 1999); Brawner
v. City of Richardson, 855 F.2d 187, 191-92 (5th Cir. 1988) (“The disclosure of
misbehavior by public officials is a matter of public interest and therefore
deserves constitutional protection, especially when it concerns the operation of
a police department.” (footnotes omitted)).

     11
            Defendants do not contest the fourth element of the retaliation claim
identified in Harris. They acknowledge that Breaux and Ambrogio were subjected
to various disciplinary actions because of their explosive allegations.
     12
            The jury found that Plaintiffs were retaliated against for exercising
their First Amendment rights of free speech and association.        This court’s
analysis focuses on the Plaintiffs’ freedom of speech claims but applies equally
to the freedom of association claims: “When a plaintiff’s claims arise under both
freedom of speech and freedom of association, as in the case at bar, the freedom
of association claims are analyzed under the same Pickering balance test used to
determine the success of the freedom of speech claims.” Anderson v. Pasadena
Indep. Sch. Dist., 184 F.3d 439, 444 (5th Cir. 1999). In this circuit, Harris
sets out the requirements for First Amendment retaliation claims generally. The
only difference between the requirements for a retaliation claim predicated on
free speech and one predicated on free association is that the latter “is not
subject to the threshold public concern requirement.”         Boddie v. City of
Columbus, Mississippi, 989 F.2d 745, 747 (5th Cir. 1993). As a result, the
Plaintiffs’ freedom of association claims fail for the same reason as their
freedom of speech claims, namely the absence of an adverse employment action.

                                      14
actions if they are sufficiently punitive, see id. at 1150, or if

the new job is markedly less prestigious and less interesting than

the old one, see Click v. Copeland, 970 F.2d 106, 110 (5th Cir.

1992).    This court has “declined to expand the list of actionable

actions, noting that some things are not actionable even though

they have the effect of chilling the exercise of free speech.”

Benningfield v. City of Houston, 157 F.3d 369, 376 (5th Cir.

1998)(citing      Pierce,   37   F.3d   at    1150).   The   reason   for   not

expanding the list of adverse employment actions is to ensure that

§ 1983 does not enmesh federal courts in “relatively trivial

matters.”       Dorsett v. Board of Trustees, 940 F.2d 121, 123 (5th

Cir. 1991).      For example, in the education context, this court has

held     that   “‘decisions      concerning     teaching   assignments,     pay

increases, administrative matters, and departmental procedures,’

while extremely important to the person who dedicated his or her

life to teaching, do not rise to the level of a constitutional

deprivation.”      Harrington, 118 F.3d at 365 (quoting Dorsett, 940

F.2d at 123).

            Given the narrow view of what constitutes an adverse

employment action, this court has held that the following are not

adverse employment actions: (1) mere accusations or criticism, see

Harrington, 118 F.3d at 366; (2) investigations, see Pierce, 37

F.3d at 1150; (3) psychological testing, see Benningfield, 157 F.3d

at 376; (4) false accusations, see Colson v. Grohman, 174 F.3d 498,


                                        15
511 (5th Cir. 1999); and (5) polygraph examinations that do not

have adverse results for the plaintiff, see Pierce, 37 F.3d at

1150.

           The foregoing legal framework makes clear why Breaux and

Ambrogio have not suffered any adverse employment actions. Hensley

ordered Internal Affairs investigations of Breaux and Ambrogio

after they made allegations of illegal political investigations,

but, as Pierce and Colson hold, investigating alleged violations of

departmental policies and making purportedly false accusations are

not adverse employment actions.         See Pierce, 37 F.3d at 1150;

Colson, 174 F.3d at 511;     see also Benningfield, 157 F.3d at 376.

Hensley’s requiring Breaux to undergo a psychological exam after

Breaux’s intemperate remark to a fellow employee also is not an

adverse employment action.       See Benningfield, 157 F.3d at 376.

Although Breaux was placed on administrative leave from late April

to July 1994, Breaux was paid while on leave and returned to his

pre-leave position.13   Thus, Breaux suffered no adverse action with

respect to the leave. See Benningfield, 157 F.3d at 378 (plaintiff

did not suffer adverse employment action when promotion was delayed

two years in response to her exercising her free speech rights

because she eventually received the promotion with retroactive pay

and seniority).    Similarly, any criticism, such as Hensley’s oral

     13
            Breaux did not allege that his initial transfer out of the
Intelligence Unit, made at his request, or his assignment to desk duty in
November 1993 were retaliatory. It was not until March, 1994 that he first
exercised his free speech rights by publicly alleging corruption.

                                   16
threats or abusive remarks, does not rise to the level of an

adverse employment action.       See Harrington, 118 F.3d at 366.

              More troubling are Chief Hensley’s public posting of the

findings of the Internal Affairs investigation and his attempt to

get Breaux and Ambrogio to sign resignation letters.                  Although

posting the results of the Internal Affairs investigation in the

station may have comported with Departmental regulations, Hensley’s

disseminating that information to the media went “several steps

beyond    a    criticism   or   accusation     and    even   beyond     a    mere

investigation” and was “punitive in a way that mere criticisms,

accusations, and investigations are not.”            Colson, 174 F.3d at 512

n.7.     The reprimands went, at least temporarily, on Breaux’s and

Ambrogio’s permanent records.

              However, this court recognizes that a rescinded reprimand

does not rise to the level of an adverse employment action: “[if]

the    reprimand   was   rescinded   through    internal     [Houston       Police

Department] procedures ... [it] does not constitute an adverse

employment action.” Benningfield, 157 F.3d at 377. After becoming

Chief of Police, Barnett “non-sustained” the charges against Breaux

and Ambrogio.       The Plaintiffs contend that “an after-the-fact,

unpublicized correction could not and did not undo the injury that

Hensley’s earlier reprimand caused.”            But the record does not

indicate what employment injury the Plaintiffs have suffered.

Breaux and Ambrogio are in a position similar to that of the law



                                     17
professors     in   Harrington.       See    Harrington,     118   F.3d    at    366.

Neither Plaintiff has been discharged from the Garland Police

Department.         Neither     Plaintiff    has   been    demoted,       denied    a

promotion, suffered a reduction in pay, or lost seniority as a

result of his speech.           In fact, the only parties to the present

suit who have lost their jobs are Hensley and Holifield.                        Thus,

Chief      Barnett’s   non-sustaining        the   charges    through      internal

procedures precluded an adverse employment result.14

              The Plaintiffs also contend that Hensley’s attempts to

get    them   to    recant    their   allegations     constitute      threats      of

discharge which, under Harrington and Click, are adverse employment

actions.15     However, Harrington and Click do not establish that a

threat of discharge is itself sufficient to establish an adverse

employment action.           In summarizing the evidence, the Harrington

court said only that “the evidence is clear that no Plaintiff has



     14
            The Plaintiffs’ concern with the publication of the Internal Affairs
investigations to the media suggests that they want to import defamation into the
adverse employment prong of their retaliation claim. But the Plaintiffs have not
made a defamation claim, nor is defamation part of the present § 1983 action.
Furthermore, this court has recognized that “[w]hen an employee retains his
position even after being defamed by a public official, the only claim of stigma
he has derives from the injury to his reputation, an interest that [Paul v.
Davis, 424 U.S. 693, 96 S.Ct. 1155 (1976),] reveals does not rise to the level
of” a Fourteenth Amendment violation. Moore v. Otero, 557 F.2d 435, 437-38 (5th
Cir. 1977). Stigma by itself, without an impact on one’s employment, does not
constitute an adverse employment action. See Blackburn v. City of Marshall, 42
F.3d 925 (5th Cir. 1995) (“We have applied the holding of Paul by requiring a
section 1983 plaintiff to show stigma plus an infringement of some other
interest.” (citation omitted)).

      15
            The other verbal criticisms that the Plaintiffs allege took place at
the chain of command board hearings are not adverse employment actions. See
Harrington, 118 F.3d at 366 (“mere criticisms do not give rise to a
constitutional deprivation for purposes of the First Amendment.”).

                                        18
been discharged or threatened with discharge....” 118 F.3d at 366.

Not only was the court not defining the requirements for making out

a successful retaliation claim under § 1983, but the court was

explaining    that   the   plaintiffs’       retaliation     claims   must     fail

because   the    plaintiffs      suffered    no    adverse    consequences      for

exercising their speech rights.

            In   Click,    the    court     principally      discussed   whether

transfers that were effectively demotions, as opposed to threats of

discharge,    were   actionable.       As    the   Click     court   stated,    the

government “‘may not deny a benefit to a person on a basis that

infringes his constitutionally protected interests -- especially,

his interest in freedom of speech.’”               970 F.2d at 109 (quoting

Perry v. Sinderman, 408 U.S. 593, 597, 92 S.Ct. 2694, 2697 (1972))

(emphasis added).      Some benefit must be denied or some negative

consequence must impinge on the Plaintiff’s employment before a

threat of discharge is actionable.16

            Click also stated that “even the threat of discharge can

be a potent means of chilling the exercise of constitutional

rights.” Click, 970 F.2d at 109.            For this purpose, Click referred


     16
            See also Bickel v. Burkhart, 632 F.2d 1251, 1255 n.6 (5th Cir. 1980)
(“impermissible retaliation [need] not result in the termination of his
employment” in order to be actionable under § 1983, but the employer’s actions
must alter “important conditions of employment”) (emphasis added). The record
does not demonstrate that the alleged threat of discharge altered any important
conditions of the Plaintiffs’ employment. Hensley took no further action with
respect to either Plaintiff after the Plaintiffs refused to sign the letters of
retraction. Breaux was already suspended with pay, and the Internal Affairs
investigations had already been completed. Compare Fyfe v. Curlee, 902 F.2d 401,
404-05 (5th Cir.) (transfer without loss in pay to menial, undemanding job is
actionable under § 1983), cert. denied, 111 S.Ct. 346 (1990).

                                      19
to the Supreme Court’s analysis in Pickering v. Bd. of Educ., 391

U.S. 563, 574, 88 S.Ct. 1731, 1737 (1968).                       Pickering does not,

however, state that a threat of discharge alone will suffice for a

First Amendment retaliation claim.                       The facts before the Court

involved not a threat, but the actual dismissal of a teacher for

writing a letter to a newspaper critical of the local school board.

In the statement quoted above by Click, the Supreme Court was

comparing dismissals of public employees with criminal sanctions

and damage awards for defamation, two other devices that had been

used to penalize the exercise of free speech rights -- before the

Supreme Court         outlawed      them.17        Had    the   Court    not    spoken   in

Pickering, and prevented retaliatory dismissals for exercise of

First         Amendment   rights,      threats       of    dismissals        could   chill

constitutional rights because they could be backed up.                         As the law

stands now, retaliatory threats are just hot air unless the public

employer is         willing    to   endure     a    lawsuit     over     a   termination.

Pickering’s (and by extension, Click’s) reference to threats of

termination illustrated the problem if threats could be realized;

the Court did not hold or imply that threats of termination alone,

in   a        post-Pickering   world    in     which      retaliatory        discharge   is

outlawed, would generate liability.

                 Breaux   contends     that    his       transfer   to   the    Telephone


         17
            The Court ultimately declined fully to equate employee dismissals
with constitutional rights in defamation cases, precisely because in the former,
a balance must be maintained between the public interest in an orderly workplace
and the discussion of issues of public concern.

                                              20
Response Unit (“TRU”) was similar to the transfer that was found in

Click to be an adverse employment action.          Although initially

compelling, this argument is without merit on a closer look at the

record.   First, Breaux was assigned to the TRU by Barnett only

after Hensley had been fired.          The record does not show that

Hensley caused Breaux to be transferred.      Second, since Breaux was

already on front desk duty, the transfer did not constitute a

punitive action by the department.       Although Breaux felt that the

TRU was a step down, “‘a plaintiff’s subjective perception that a

demotion has occurred is not enough’ to constitute an adverse

employment decision.”    Harris, 168 F.3d at 221 (quoting Forsyth v.

City of Dallas, 91 F.3d 769, 774 (5th Cir. 1996)).        At trial, Chief

Wilson, the Plaintiffs’ first witness, testified that the TRU

assignment is not viewed as punishment in the Garland Police

Department and that the TRU carries out an important function

within the Department.     Thus, since the transfer is not traceable

to Hensley and is a position similar to front desk duty, the

transfer does not constitute an adverse employment action.

          Finally,   the    Plaintiffs    argue   that,    even   if   the

individual actions taken by Hensley do not constitute an adverse

employment action, the aggregate of these actions constitutes a

“vengeful vendetta” actionable under § 1983.        For this idea, the

Plaintiffs cite only Thompson v. City of Starkville, 901 F.2d 456

(5th Cir. 1990), which observed: “Although it may be difficult to

delimit exactly what conduct, in the abstract, violates a public

                                  21
employee’s first amendment rights, a vengeful vendetta seeking an

employee’s job because of his speech on a matter of public concern

surely falls within the ambit.”        Id. at 470.        But Thompson is not

as broad as the Plaintiffs suggest.         The constituent acts and the

final result of the vendetta were worse than most of the alleged

retaliatory   actions    by     Hensley:    The    defendants    accused    the

plaintiff police officer of committing a burglary, alleged that he

threatened another officer, caused the plaintiff to be disciplined

more severely   than    other    officers    for    the   same   offense,   and

ultimately were instrumental in having him fired.             See id. at 469.

          Thompson is thus consistent with this court’s holding in

Colson.   In Colson, this court evaluated when a campaign of

retaliatory harassment amounted to an adverse employment action.

To be actionable, “the campaign of retaliatory harassment [must]

rise to such a level as to constitute a constructive adverse

employment action.” Id. at 514. The court explained “constructive

adverse employment action” by reference to two cases.               The court

held that in Sharp the plaintiff was “constructively demoted ...

because the defendants created an ‘intolerable situation’ causing

her to transfer to a less desirable position.”             Id. (quoting Sharp

v. City of Houston, 164 F.3d 923, 934 (5th Cir. 1999)).            The Colson

Court also relied upon Benningfield.          174 F.3d at 513.       Although

one plaintiff in Benningfield resigned as a result of a campaign of

harassment, the court held that a reasonable person in her position


                                     22
would not have felt compelled to resign.           Since Breaux and Ambrogio

still have their jobs with the Department and have neither been

demoted nor transferred to less desirable positions, they have

failed   to    show     that   the   Defendants’   actions   amounted    to   a

constructive or actual adverse employment action.

B.   City Manager Holifield

              Despite    Holifield’s     limited    interaction   with    the

Plaintiffs, the jury found Holifield liable under § 1983 for over

$4 million in damages.         On appeal, Holifield argues that there was

insufficient evidence to show that, as required by the language of

§ 1983, he “cause[d]” the Plaintiffs to be subjected to First

Amendment violations. As noted, whether the Plaintiffs alleged any

adverse employment actions by Holifield is a question of law

reviewed de novo.        See Harrington, 118 F.3d at 365.

              In “assessing an individual supervisor’s liability under

§ 1983,” this circuit applies the City of Canton standard of

municipal liability.       Doe v. Taylor Indep. Sch. Dist., 15 F.3d 443,

453 (5th Cir. 1994)(en banc).         Under this standard, a supervisor is

liable under § 1983 only if (1) his conduct directly causes a

constitutional violation or (2) the plaintiffs can show that the

supervisor was “deliberately indifferent” to a violation of a

constitutional right.          Id. at 454 n.8. (citing City of Canton, 489

U.S. 378, 388 n.8, 109 S.Ct. 1197, 1204 n.8 (1989)).

              Holifield did not cause the Plaintiffs to suffer a


                                        23
violation of their First Amendment rights. His direct contact with

the Plaintiffs was limited. During the March 1994 meeting with the

GPOA Board members, Holifield threatened to “destroy” the GPOA if

the group acted politically within the department. With the assent

of Breaux and Ambrogio, Holifield referred Breaux’s allegations of

politically-inspired investigations to Hensley.        Holifield also

notified Hensley that film was missing from the hidden camera in

his office and suggested that one of the GPOA Board members, who

had recently met with him there and could recognize the camera,

might have stolen the film.

          Internal   Affairs   investigations   were   commenced   with

respect to Breaux’s allegations of corruption and the missing film.

But, since neither of these investigations constitutes an adverse

employment action, see Benningfield, 157 F.3d at 376, Holifield’s

role in initiating the investigations is not a sufficient “cause”

to establish liability under § 1983.   See Heil v. Santoro, 147 F.3d

103, 110 (2d Cir. 1998) (“There being no First Amendment violation

in investigating, the reason for the investigation created no

material issue to be tried.”). Similarly, Holifield’s criticism of

and threat to destroy the GPOA are not adverse employment actions.

See Harrington, 118 F.3d at 366.

          The result is the same if Holifield’s conduct is viewed

from the perspective of his supervisory role. Liability is imposed

only if he was deliberately indifferent to subordinates’ violations


                                 24
of   the   Plaintiffs’    constitutional     rights.      Laying   aside    the

question whether the city manager was a supervisor of anyone in the

Police Department, the fact that Plaintiffs’ First Amendment rights

were not actually infringed exonerates Holifield from supervisory

liability.

C.    The City of Garland

      1.    Breaux’s appeal

            Breaux appeals the district court’s summary judgment on

his § 1983 claim against the City and post-verdict judgment as a

matter of law on his Whistleblower Act claim.            The district court

granted summary judgment to the City on all § 1983 claims, holding

that no injury was caused by a municipal policymaker.

            Because    of   a   short      limitation    period    under    the

Whistleblower Act, Breaux’s state law claim against the City is

based solely upon his transfer to the TRU for several months in

1994. The district court granted judgment as a matter of law on the

Whistleblower Act claim because Breaux failed to exhaust his

administrative remedies.18      Breaux contends that exhaustion was not

required because the police department’s Internal Affairs process

did not allow for complaints against the Chief of Police, but, in

the alternative, he did file such a complaint.            This court reviews

the district court’s judgment as a matter of law de novo.              Pierce,


      18
            See Tex. Gov’t Code Ann. § 554.006(a) (West 1994) (“An employee of
a local government must exhaust that government’s grievance or appeal procedures
relating to suspension or termination of employment or unlawful discrimination
before suing under this chapter.”) (amended 1995).

                                      25
37 F.3d at 1149.

           The exhaustion requirement of the Texas Whistleblower Act

is jurisdictional and, therefore, mandatory and exclusive.         See

Essenburg v. Dallas County, 988 S.W.2d 188, 189 (Tex. 1998) (“It is

true that a plaintiff’s failure to exhaust administrative remedies

may deprive courts of subject matter jurisdiction in the dispute

... [since] the exhaustion requirement seeks to assure that the

appropriate body adjudicates the dispute -- the hallmark of a

jurisdictional     dispute.”).   Moreover,   the   Whistleblower   Act

requires “the employee to utilize all procedures in place for

resolving disputes at the governmental entity.”       Gregg County v.

Farrar, 933 S.W.2d 769, 775 (Tex. App. -- Austin 1996, writ

denied).     Contrary to Breaux’s claim on appeal, the Internal

Affairs process of the Garland Police Department is broad enough to

encompass claims against the Chief of Police.      Under General Order

76-29, the policy of Internal Affairs is to investigate “all

complaints ... of misconduct of employees who are sworn police

officers.”   General Order 76-29.   Misconduct is defined to include

a violation of the general orders of the Department.      In response

to the City’s motion for judgment as a matter of law, Breaux

characterized his complaint as being “that Chief Barnett and his

subordinates were retaliating against him by transferring him to

the TRU for ‘blowing the whistle’ on Barnett’s allies, Hensley and




                                 26
Jody Lay.”19      By alleging that the Chief of Police violated the

Whistleblower Act, Breaux invoked both General Order 76-5, which

subjects an officer to disciplinary action for violating state law,

and   General     Order   76-29,    which   proscribes   misconduct.       The

administrative remedy was available to Breaux.

            Breaux argues, however, that the Internal Affairs process

could not resolve complaints against the Chief of Police; filing a

complaint with Internal Affairs would be futile since the Chief of

Police determines whether an investigation should be initiated and

ultimately reviews the results.             In support of Breaux’s claim,

Chief Wilson testified that, “I would think if an officer had an

accusation to make against the chief of police, it might be

appropriate to go outside the Internal Affairs unit to do that ...

[T]here’s no guide book that says if you’re going to accuse the

chief of police of something follow steps one, two and three.”

            The district court rejected Breaux’s argument.              Texas

courts     have   recognized    a    futility   exception    to   exhaustion

requirements in only a limited number of circumstances. See, e.g.,

Town of Sunnyvale v. Mayhew, 905 S.W.2d 234, 246 (Tex. App. 1994),

rev’d on other grounds, 964 S.W.2d 922 (Tex. 1998); Methodist



      19
            In order to show that his complaint falls outside the scope of the
Internal Affairs process, Breaux also characterizes his complaint as an
“employment-related dispute.” But if his complaint involved only an employment
dispute, Breaux’s complaint would not fall within the Whistleblower Act. Thus,
in order to maintain an action under the Act, Breaux must allege a violation of
state law by Chief Barnett -- a claim that does fall within the purview of
Internal Affairs.

                                       27
Hosps. of Dallas v. Texas Workers’ Compensation Comm’n, 874 S.W.2d

144, 149-50 (Tex. App. 1994, no writ).              Since no Texas court has

applied    a   futility         exception    to    statutory,    jurisdictional

exhaustion requirements, the district court refused to “enlarge

existing   state    law    by     adopting   a    futility   exception   to   the

Whistleblower Act’s exhaustion requirement.”                    This court also

refuses to create a futility exception under such circumstances.

           The purposes of the exhaustion requirement are to give

the employer notice of a grievance and a chance to resolve it.                  As

the Texas Supreme Court recently noted, the exhaustion requirement

demonstrates the legislature’s “will to have the agency resolve

disputed issues of fact and policy.” Essenburg, 988 S.W.2d at 189.

The fact that the Act allows an employee to file a civil suit if

the employer has not resolved his complaint in 30 days shows that

“the legislature intended that the governmental entity should be

afforded the opportunity to correct its own errors by resolving

disputes before being subjected to the expense and effort of

litigation.”      Farrar, 933 S.W.2d at 775.

           Even    if     the     Department’s     procedures    for   filing   a

grievance against the Chief of Police were unclear, the exhaustion

requirement still serves a notice-giving function.                 Texas courts

have recognized a futility exception only in cases where it was

impossible for the governmental agency to address an issue, e.g.,




                                        28
the constitutionality of a statute.20            But here, requiring notice

even    if   the   available   grievance     procedures      are   not   clearly

delineated would have enabled the City either to develop a record

for judicial review on fact questions (if not to resolve the

dispute about the transfer) or possibly to mitigate Breaux’s

damages by transferring him out of the TRU sooner.                   To repeal

exhaustion when grievance procedures are ambiguous would eliminate

the notice-giving effect of the Act’s exhaustion requirement, which

has been held to supersede general presentment requirements.21               Id.

at   773.     Furthermore,     requiring    an    employee    to   exhaust   his

remedies, which could delay a civil suit by only 30 days, is hardly

onerous or unfair.

             In any event, the premise of Breaux’s argument for the

futility of exhaustion appears incorrect.               General Order 76-29


       20
            The cases Breaux cites as examples of exceptions to the exhaustion
requirement involved situations where there clearly was no way for the agency
involved to provide relief. See Texas State Bd. of Pharmacy v. Walgreen Texas
Co., 520 S.W.2d 845 (Tex. 1975) (agency powerless to determine constitutionality
of statutes); City of Austin v. Phipps, 344 S.W.2d 673 (Tex. 1961) (Civil Service
Commission given no jurisdiction over denial of injury leave of absence);
Birdville Indep. Sch. Dist. v. First Baptist Church, 788 S.W.2d 26 (Tex. App. --
Fort Worth 1988, writ denied) (agency powerless to decide constitutionality of
statute). As discussed above, this is not the case in the present action.
      21
            Even if the grievance procedure is ambiguous with respect to filing
complaints against the Chief of Police, Texas case law suggests that an employee
is not exempt from the need to notify his employer that the employee is about to
file a Whistleblower claim in court. Under the Act, when “it is unclear whether
the employer has a post-termination grievance procedure, or it is unclear what
the procedure is and when ... the terminated employee [timely] notifies the
employer that he is invoking that employee’s grievance procedure, informing the
employer that it has 30 days in which to conclude the grievance procedure,” the
employee would meet the statute of limitations provision in the Act. Beiser v.
Tomball Hosp. Auth., 902 S.W.2d 721, 724 (Tex. App. -- Houston [1st Dist.] 1995,
writ denied). Since the limitations period is tolled by a proper invocation of
grievance procedures, this holding speaks directly to exhaustion.

                                       29
permits Internal Affairs to investigate all complaints against any

sworn police officer, thus including the Chief of Police.           Under

General Order 76-29, an officer can complain of misconduct to any

supervisor, and “the complainant should be referred to Internal

Affairs directly if possible.”   General Order 78-61 provides for a

line of succession in command if the Chief of Police is determined

to be incapacitated because, e.g., the Chief is recused from a

matter due to a conflict of interest.      As a result, the Internal

Affairs process is equipped to handle a complaint against the Chief

of Police or, at least, to provide the Department and the City with

notice of an employee’s potential claim.        Because the Internal

Affairs regulations do not preclude a complaint against the Chief

and indeed contemplate the necessity of circumventing the Chief,

and because the exhaustion requirement advances Texas’ concern with

giving employers notice, a futility exception to the Whistleblower

Act exhaustion requirement is inappropriate.

          Finally,   Breaux   contends   that   his   letter   to   Chief

Barnett, entitled “Request Consideration for Transfer,” effectively

initiated the Internal Affairs process for exhaustion purposes.

General Order 76-29 provides that an officer’s complaint may be

“initiated by submitting a written memorandum to the Director of

Police Services requesting an investigation and detailing the

conduct being complained about.”         Breaux’s letter stated that

(1) he “was ordered into the TRU, against [his] will,” (2) he “did


                                 30
not request assignment to this position,” and (3) “the transfer was

directly related to dictates of a previous police administrator.”

Breaux neither provided any details about retaliatory conduct nor

requested    an   investigation     into    the   transfer.      At   most,   he

requested that a written explanation be given if his request for a

transfer were denied: “I am not aware of any reasons that would

prohibit me from this requested transfer to an enforcement position

in patrol; but if any exist, I would appreciate being advised in

writing so that the issue could be confronted and resolved.”22                His

letter was insufficient to state a complaint under General Order

76-29 or to exhaust under the Whistleblower Act.23

      2.    Ambrogio’s appeal

            Ambrogio appeals only the taxing of some of the City’s

costs against him.        In its May 8, 1998, Amended Judgment, the

district court dismissed all claims against the City and taxed 40%

of the City’s costs of court against Ambrogio.            This court reviews

a district court’s award of costs for an abuse of discretion.

Fogleman v. ARAMCO, 920 F.2d 278, 285 (5th Cir. 1991).

            The taxation of costs is allowed “as of course to the


     22
             In his letter to Chief Barnett, Breaux asked permission “to transfer
back to the uniform patrol division during the next seniority selection process”
in the fall of 1994. Barnett granted Breaux’s request, and Breaux returned to
patrol duty in November 1994.
      23
            The case Breaux cites for broadly construing his alleged complaint
is distinguishable. In Farrar, the court found that a letter complaining of a
demotion “without just cause” was sufficient to provide notice that the complaint
was about “retaliatory employment practices.” Farrar, 933 S.W.2d at 774. But
Farrar, unlike Breaux, had written a letter specifically to a grievance
committee, initiating a committee hearing about Farrar’s demotion.

                                       31
prevailing party unless the court otherwise directs.” Fed. R. Civ.

P. 54(d)(1).          In this case, the City clearly prevailed against

Ambrogio.      None of Ambrogio’s claims against the City went to the

jury,   and      he    does   not    appeal       the   district   court’s   pretrial

dismissal of those claims.                 On appeal, Ambrogio does not explain

how the district court abused its discretion in apportioning costs

against him.

                                     IV.    CONCLUSION

              The police officers failed to make out a First Amendment

retaliation claim.            Even though they persuaded the jury, and we

have assumed, that they truthfully spoke out to reveal political

investigations of public officials, the exercise of First Amendment

rights is not enough.                The retaliation they complained of --

investigations, criticisms, public (but withdrawn) reprimands,

psychological and polygraph testing, suspension with pay, transfer

to   the   TRU    --    do    not,    either      individually     or   collectively,

constitute adverse employment actions.                      The actions taken by

Hensley and Holifield did not give rise to § 1983 liability.                      For

reasons previously explained, we have rejected the other issues

raised on appeal.

              This court reverses the judgment for the Plaintiffs on

their § 1983 claims against the individual Defendants and renders

a take-nothing judgment against the Plaintiffs on these claims. We

affirm the district court’s dismissal of the City as a Defendant



                                             32
and the taxing of costs against Ambrogio.

          AFFIRMED IN PART; REVERSED AND RENDERED IN PART.




                               33
