Dallas McIntosh v. Wexford Health Sources, Inc.

In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 19-1095
D ALLAS MCINTOSH ,
Plaintiff-Appellant,
v.
WEXFORD HEALTH SOURCES, INC., et al.,
Defendants-Appellees.
____________________
Appeal from the United States District Court for the
Southern District of Illinois.
No. 3:17-cv-103 — J. Phil Gilbert, Judge.
____________________
A RGUED SEPTEMBER 29, 2020 — D ECIDED FEBRUARY 5, 2021
____________________
Before R OVNER , BRENNAN, and S CUDDER , Circuit Judges.
SCUDDER , Circuit Judge. The Prison Litigation Reform Act
requires a prisoner to exhaust administrative remedies before
challenging his conditions of confinement in federal court. As
we recognized in Pavey v. Conley, sometimes a dispute arises
over whether a prisoner satisfied this exhaustion require-
ment, and resolving the question requires holding a hearing,
finding facts, and making credibility determinations. All of
that happened here, with a magistrate judge holding a

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2 No. 19-1095
hearing and determining that Dallas McIntosh exhausted
remedies available to him within the St. Clair County Jail in
southern Illinois. But the district court then rejected the mag-
istrate judge’s recommended finding, and it did so without
itself holding a new hearing upon which to base its own cred-
ibility determinations. That was error in the circumstances
present here, where witness credibility weighed heavily in the
exhaustion-of-remedies inquiry. We remand for a hearing in
the district court.
I
A
In early 2017 Illinois inmate Dallas McIntosh invoked
42 U.S.C. § 1983 and sued Wexford Health Sources and mul-
tiple jail officials for acting with deliberate indifference to his
serious medical needs. McIntosh alleged not only that a nurse
funneled him unprescribed medication under the table, but
also that staff members failed to prevent him from attempting
suicide after he became addicted to the painkillers and began
suffering from acute mental illness. At that time, McIntosh
was a pretrial detainee who had not yet been convicted of a
crime, and so his claim arose not under the Eighth Amend-
ment’s prohibition of cruel and unusual punishment, but ra-
ther under the Fourteenth Amendment’s Due Process Clause.
See Miranda v. County of Lake, 900 F.3d 335, 350 (7th Cir. 2018).
Before entering the courthouse, though, McIntosh had to
satisfy the obligation Congress put on prisoners in the Prison
Litigation Reform Act to exhaust all available administrative
remedies. See 42 U.S.C. § 1997e(a). As McIntosh tells it, he did
so by timely filing grievances detailing the substance of his
complaints with the appropriate officers in the manner

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No. 19-1095 3
prescribed by the jail’s written procedures. But the process
came to an abrupt halt, McIntosh continues, when Sergeant
Steve Strubberg told him that the internal administrative pro-
cess was on hold pending the outcome of a criminal investi-
gation into how he had obtained such large quantities of un-
prescribed pain medication.
Wexford and the jail officials present a competing narra-
tive. By their telling, McIntosh submitted no grievances and
indeed fabricated the entire exhaustion account. The defend-
ants accordingly moved for summary judgment on the
ground that McIntosh failed to exhaust administrative reme-
dies before filing his § 1983 action in federal court.
B
Recognizing the contested exhaustion facts, the district
court referred the case to a magistrate judge for a so-called
Pavey hearing. See Pavey v. Conley, 544 F.3d 739, 742 (7th Cir.
2008) (requiring that, where exhaustion is contested, the dis-
trict court hold a hearing to resolve relevant facts before pro-
ceeding to pretrial discovery). Over the course of two days,
the magistrate judge heard testimony from McIntosh and Ser-
geant Strubberg of the St. Clair County Jail. McIntosh also
supported his testimony with two affidavits from fellow in-
mates. As the parties emphasized to the magistrate judge, the
exhaustion dispute would “come down to an issue of credi-
bility between Mr. McIntosh and Sergeant Strubberg.”
In time the magistrate judge issued a report and recom-
mendation rejecting the defendants’ invitation to “find McIn-
tosh’s version of events not credible.” Indeed, the magistrate
judge credited and accepted McIntosh’s version of events, fur-
ther finding that the affidavits from the two other inmates

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4 No. 19-1095
corroborated and reinforced his account. Based on these find-
ings, the magistrate recommended that the district court deny
the defendants’ motion for summary judgment.
The defendants objected to the magistrate judge’s report.
The district court reviewed the record and transcripts but
then—without holding any hearing of its own—rejected not
just the magistrate judge’s overarching finding that McIntosh
had exhausted administrative remedies, but also the specific
credibility determinations underpinning that finding. The
district court found that McIntosh’s grievance paperwork re-
flected forgery and rejected the two inmate affidavits as con-
taining impermissible hearsay. Even more, the district court
underscored that it saw the parties’ credibility much differ-
ently, finding it “plainly apparent that Strubberg and his story
are much more credible than McIntosh and his.” Relying on
these new findings, the district court entered summary judg-
ment for the defendants.
McIntosh now appeals.
II
The parties start from a point of agreement. They recog-
nize that the district court acted properly under the Federal
Magistrates Act in referring the contested exhaustion ques-
tion to a magistrate judge for a Pavey hearing. See 28 U.S.C.
§ 636(b)(1)(B) (providing that a district court may “designate
a magistrate judge to conduct hearings, including evidentiary
hearings, and to submit to a judge of the court proposed find-
ings of fact and recommendations for the disposition” of most
motions filed with the district court).
The Federal Magistrates Act then goes further and pro-
vides direction to district courts where a party raises an

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No. 19-1095 5
objection to some portion of a magistrate judge’s report and
recommendation. In those circumstances, Congress tasked
the district court with making “a de novo determination of
those portions of the report or specified proposed findings or
recommendations to which objection is made.” Id. § 636(b)(1).
In United States v. Raddatz the Supreme Court held that a
district court, when faced with an objection to a magistrate
judge’s report, need not rehear live testimony before relying
on a magistrate’s recommendation and credibility determina-
tions. See 447 U.S. 667, 680–81 (1980). The Federal Magistrates
Act, the Court reasoned, calls only for a “determination”—not
for a hearing. Id. at 674. But the Court took care to limit its
holding to those instances where a district judge approves and
accepts a magistrate’s credibility determinations:
Neither the statute nor its legislative history reveals
any specific consideration of the situation where a dis-
trict judge after reviewing the record in the process of
making a de novo “determination” has doubts concern-
ing the credibility findings of the magistrate. The issue
is not before us, but we assume it is unlikely that a dis-
trict judge would reject a magistrate’s proposed find-
ings on credibility when those findings are dispositive
and substitute the judge’s own appraisal; to do so with-
out seeing and hearing the witness or witnesses whose
credibility is in question could well give rise to serious
questions which we do not reach.
Id. at 681 n.7.
In Raddatz’s wake, we have “directly address[ed] the con-
stitutional implications that were alluded to by the Court.”
Jackson v. United States, 859 F.3d 495, 499 (7th Cir. 2017). We

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6 No. 19-1095
held in Jackson that a district court offends due process by “re-
ject[ing] a magistrate judge’s material credibility findings
based on a witness’s live testimony, without first holding a de
novo evidentiary hearing.” Id.
Wexford and the jail officials urge us to read Jackson as lim-
ited to its precise context—criminal law and post-conviction
relief under 28 U.S.C. § 2255. We decline that invitation. Both
habeas petitions and § 1983 actions are civil proceedings that
“serve to protect basic constitutional rights.” Wolff v. McDon-
nell, 418 U.S. 539, 579 (1974). We see no reason to require a
hearing in the habeas post-conviction review context without
also demanding the same procedural protections in prisoner
civil rights litigation under § 1983. See id. (noting that “the de-
marcation line between civil rights actions and habeas peti-
tions is not always clear” and it “is futile to contend that the
Civil Rights Act of 1871 has less importance in our constitu-
tional scheme than does the Great Writ”).
Nor do Wexford or the jail officials point us to authority
compelling their position. Though we have previously em-
phasized the discretion afforded district courts to review
magistrate judge recommendations without conducting a
new hearing, we have done so only in situations where a dis-
trict court adopted the findings of a magistrate judge. See, e.g.,
Goffman v. Gross, 59 F.3d 668, 671 (7th Cir. 1995); United States
v. Severson, 49 F.3d 268, 273 (7th Cir. 1995). That a district court
adopting a magistrate judge’s findings is not required to hold
a new hearing says little of what a judge must do before reject-
ing a magistrate judge’s findings and recommendations.
A more general precept warrants underscoring. Due pro-
cess, the law has long recognized, “is flexible and calls for
such procedural protections as the particular situation

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No. 19-1095 7
demands.” Mathews v. Eldridge, 424 U.S. 319, 334 (1976) (quot-
ing Morrissey v. Brewer, 408 U.S. 471, 481 (1972)). Where, as
here, a district judge questions and then rejects the credibility
determinations made by a magistrate judge during a Pavey
hearing, the district court must hold a de novo hearing to sup-
port its own credibility determinations, absent extraordinary
circumstances.
The qualifier—absent extraordinary circumstances—is
important. We do not mean to chisel our observations in Jack-
son into an unyielding rule. It may be that in some rare cir-
cumstance, particular credibility findings by a magistrate
judge find no plausible support in the record. But that is far
from what transpired here. Our review of the record leaves us
with the impression that the magistrate judge’s credibility
findings had ample support. The magistrate judge held a
hearing, heard McIntosh’s story directly from the source, and
weighed McIntosh’s credibility against that of Sergeant Strub-
berg. After the hearing, the magistrate judge credited McIn-
tosh’s account. In these circumstances, the district court was
not free to reject that determination without itself hearing
from the essential witnesses.
Hearings often offer what paper cannot. The court will
hear directly from the witnesses and have the opportunity to
assess the coherence of their accounts by evaluating their de-
meanor, conduct, clarity, conviction, body language, and the
like—in a word, their credibility. In this way, the new hearing
is not just process for the sake of process. Process matters pre-
cisely because it often enhances the quality of decision mak-
ing. All of that is certainly so here, where so much turns on
assessments of individual and comparative credibility.

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8 No. 19-1095
III
Two final observations will provide guidance on remand.
First, the district court must be sure to draw all reasonable in-
ferences in McIntosh’s favor. We are not certain the court did
so the first time around. Take, for example, the district court’s
response to the parties’ arguments regarding the absence of
administrator signatures on McIntosh’s grievances. The dis-
trict court reasoned that “[t]he lack of signatures only shows
that both sides of the story here are plausible—but that does
not mean that you immediately take the plaintiff’s side as
true.” To the contrary, “[p]lausible inferences must be re-
solved in favor of the party opposing summary judgment.”
Gramenos v. Jewel Co., Inc., 797 F.2d 432, 436 (7th Cir. 1986).
This error, too, may have influenced the district court’s ruling.
A fresh hearing will allow the court to take a new look at the
evidence and to consider it in the light most favorable to
McIntosh.
Second, the district court should consider McIntosh’s two
inmate affidavits. The Federal Rules of Evidence define hear-
say as an out-of-court statement “a party offers into evidence
to prove the truth of the matter asserted in the statement.”
FED. R. EVID. 801(c)(2). The two affidavits are not inadmissible
hearsay because they were submitted not for their truth—not
to prove as a matter of fact that McIntosh would have to await
the conclusion of the investigation before proceeding further
with the grievance process—but instead to establish what Ser-
geant Strubberg said and what effect his words may have had
on McIntosh.
For these reasons, we VACATE the district court’s judg-
ment and REMAND for proceedings consistent with this
opinion.

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