RUDOLPH CONTRERAS, United States District Judge.
Plaintiff BEG Investments, LLC, operated Twelve Restaurant and Lounge, a nightclub in the District of Columbia. As a consequence, Plaintiff's business was regulated by the D.C. Alcohol Beverage Control Board ("the Board"), an administrative body tasked with approving, changing, suspending, and revoking liquor licenses for establishments serving alcoholic beverages in the District. In June 2011, after reports of multiple violent incidents at Plaintiff's establishment, the Board granted Plaintiff's application to renew its liquor license, but did so on the condition that Plaintiff hire a police detail to patrol the area surrounding its establishment when Plaintiff provided certain types of live entertainment. Plaintiff filed suit against six members of the Board in February 2013, arguing that the condition on its liquor license was discriminatory and extortionate. This Court dismissed Plaintiff's six-count complaint on March 31, 2014, on qualified immunity grounds and for failure to state a claim, but gave Plaintiff leave to amend its First Amendment and Equal Protection Clause claims. Plaintiff filed an amended complaint on April 30, 2014.
On June 6, 2014, after an assault occurred at Plaintiff's establishment, the Board summarily suspended Plaintiff's liquor license. Plaintiff views the suspension and other actions taken by the Board after Plaintiff filed its first complaint as retaliatory, and Plaintiff filed a motion to supplement its complaint with these allegations on July 16, 2014. The supplemental complaint named two additional Board members as Defendants, as well as a Sergeant with MPD and an attorney for the District of Columbia's Office of the Attorney General ("OAG"). Now before the Court are Defendants' motion to strike the amended complaint or, in the alternative, to dismiss all claims, Plaintiff's motion to supplement its complaint, and Defendants' motion for Rule 11 sanctions. Upon consideration of the parties' motions and the memoranda in support thereof and opposition thereto, the Court will grant Defendants' motion to strike or dismiss the amended complaint, grant in part and deny in part Plaintiff's motion to supplement its complaint, and grant in part and deny in part Defendants' motion for Rule 11 sanctions.
Plaintiff is a company that formerly operated Twelve Restaurant and Lounge in the District of Columbia. Defendants
As detailed in this Court's Memorandum Opinion of March 31, 2014,
On June 22, 2011, the Board issued an order on Plaintiff's application for renewal of its liquor license. Board Order 2011-289 at 7, Defs.' Ex. A, ECF No. 19-2;
Upon Plaintiff's motion for reconsideration, the Board modified its June 22 order on August 10, 2011, ordering that Plaintiff hire an MPD reimbursable detail "whenever the establishment provides any DJs or live music as entertainment at the establishment." Board Order 2011-368 at 12, Defs.' Ex. B, ECF No. 19-2. Additionally, the modified order required that the MPD detail "be hired for a minimum of four hours and shall end no sooner than one hour after closing." Id. On July 11, 2012,
Plaintiff initiated this action by filing a six-count complaint against Defendants in their individual capacities on February 11, 2013. See generally Compl., ECF No. 1. Plaintiff claimed that the Board's orders requiring Plaintiff to hire an MPD detail at a rate of over $55 per hour—more than double the basic wage of police officers—was unlawful and extortionate. Plaintiff alleged: (1) racketeering in violation of RICO, 18 U.S.C. § 1962(c); (2) conspiracy to commit racketeering in violation of RICO § 1962(d); (3) deprivation of equal protection of the law; (4) deprivation of property in violation of the Takings Clause of the Fifth Amendment; (5) deprivation of freedom of speech in violation the First Amendment; and (6) conspiracy to deprive Plaintiff of equal protection of the laws in violation of 42 U.S.C. § 1985. Defendants moved to dismiss the complaint under Federal Rule of Civil Procedure 12(b)(6), and the Court granted Defendants' motion. See Order, ECF No. 8.
In its Memorandum Opinion, this Court explained that Plaintiff's RICO claims, which were predicated on violations of the Hobbs Act, failed because the unlawfulness of Defendants' imposition of a reimbursable detail was not clearly established. BEG Investments, 34 F.Supp.3d at 80-84. As a result, Defendants were entitled to qualified immunity on the RICO and Hobbs Act claims. Id. Additionally, the Court found that Plaintiff's allegations were inadequate to state an Equal Protection Clause, Fifth Amendment, or First Amendment claim. Id. at 84-88. Although the Court dismissed Plaintiff's complaint in its entirety, it did grant Plaintiff leave to amend its claims brought pursuant to the Equal Protection Clause and the First Amendment because Plaintiff had alleged additional facts pertaining to those claims in its opposition brief. Order, ECF No. 8.
On April 30, 2014, Plaintiff filed an amended complaint against the same six Defendants, this time in both their individual and official capacities. Am. Compl. ¶¶ 3-4, ECF No. 12. Notably, the amended complaint was not limited to Plaintiff's Equal Protection Clause and First Amendment claims, which the Court had given Plaintiff leave to amend. Instead, the amended complaint reasserted all six of Plaintiff's previously dismissed claims and added a seventh claim that Defendants violated the Civil Rights Act of 1964 by targeting establishments like Plaintiff's "for the purpose of inhibiting the free association of young black African Americans and to inhibit the playing of `urban' styles of music such as R & B, Hip-Hop and Go-Go music." Am. Compl. ¶ 119.
Defendants, pointing out that Plaintiff had not obtained either their consent or the Court's leave to amend as required by Federal Rule of Civil Procedure 15(a)(2), have moved to strike the amended complaint, with the exception of Plaintiff's Equal Protection Clause and First Amendment claims. Defs.' Mot. Strike at 6, ECF No. 14-1. Alternatively, Defendants move to dismiss all claims pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim. Id. at 1.
On July 16, 2014, Plaintiff filed a two-page motion for leave to file a supplemental complaint to include events that occurred after Plaintiff filed its first complaint, pursuant to Federal Rule of Civil Procedure 15(d). Pl.'s Mot. Leave to Suppl. Compl. at 1-2., ECF No. 18. The
According to Plaintiff, Ms. Schmidt violated Plaintiff's First Amendment rights by fabricating a noise complaint against Plaintiff in retaliation for the filing of this lawsuit. Suppl. Compl. ¶¶ 58-63, ECF No. 18-1. Plaintiff alleges that it received a Notice of Status Hearing and Show Cause hearing on March 13, 2013—approximately one month after Plaintiff filed its first complaint—detailing a noise complaint that allegedly occurred more than seven months prior, on July 26, 2012. Id. ¶¶ 6-9. Citing inconsistent allegations regarding the time the noise violation occurred, the inability of the ABRA investigator to provide details about the complainant, and the Board's decision to dismiss the charge for lack of sufficient evidence, Plaintiff alleges that the investigative report and other documents related to the noise complaint "were wholly fabricated by Schmidt and other unknown persons" after Plaintiff filed its first complaint in this case. Id. ¶¶ 10-24.
Next, Plaintiff alleges that the Board cancelled Plaintiff's liquor license and closed its establishment on May 14, 2014, for the improper purpose of interfering with this suit and in violation of Plaintiff's First Amendment rights. Id. ¶¶ 72-79. By way of background, Plaintiff explains that it properly submitted its license renewal application on September 6, 2013, but that Plaintiff's representative became ill and failed to appear or to request a continuance of Plaintiff's December 11, 2013, status hearing. Id. ¶¶ 25-26. As a consequence of Plaintiff's failure to appear, the Board dismissed the September 2013 renewal application. Id. ¶ 27. Plaintiff subsequently requested that its application be reinstated, but the Board refused, so Plaintiff reapplied for renewal on February 7, 2014. Id. ¶¶ 28-30. The Board held a hearing on the second renewal application on April 21, 2014, but Plaintiff contends it did not receive notice of the scheduling of the hearing. Id. ¶¶ 31-33. When Plaintiff again failed to appear, the Board dismissed the second renewal application and instructed Plaintiff that it could request reinstatement of its application within ten days. Id. ¶¶ 32, 34. Plaintiff did not request reinstatement of the second renewal application and instead submitted a third renewal application to ABRA on April 28, 2014. Id. ¶¶ 33, 35. On May 12, 2014, the Board ordered Plaintiff to cease selling alcoholic beverages, citing Plaintiff's failure to apply for reinstatement of its second renewal application. Id. ¶¶ 36-37. The Board's order, however, failed to acknowledge the fact that Plaintiff had already filed a third renewal application with ABRA. Id. Plaintiff alleges that its third application was readily evident, that its license was not yet expired, and that the Board's decision to order Plaintiff to
On May 24, 2014, three days after the Board allowed Plaintiff to resume operations, an assault occurred in Plaintiff's establishment. See Suppl. Compl. ¶¶ 38-39. The Chief of MPD temporarily suspended the operation of Plaintiff's establishment, finding that the violent crime was directly connected to Plaintiff's establishment and that it severely endangered the public. Id. Plaintiff alleges that MPD's Sergeant Pope, who responded to the assault, falsely reported to an ABRA investigator that the establishment did not immediately comply with police instructions after the assault, that emergency respondents had difficulty reaching and transporting the victim due to the establishment's lack of assistance, that Plaintiff's staff were not cooperative, and that the scene was chaotic. Id. ¶¶ 40-46. Plaintiff contends that Sergeant Pope denied making those allegations when he took the stand at a subsequent evidentiary hearing before the Board, that video evidence contradicted a number of the allegations, and that the Board's June 6, 2014, order suspending Plaintiff's liquor license contained a number of factual assertions that lacked evidentiary support. Id. ¶¶ 46-56. Accordingly, Plaintiff claims that the Board's June 2014 order was based on information known by the Board to be false and intended to interfere with Plaintiff's prosecution of this case in violation of Plaintiff's First Amendment rights.
Plaintiff also alleges that Sergeant Pope's false statements to the ABRA investigator constitute defamation per se and defamation per quod, id. ¶¶ 80-94, and that Defendants have conspired to deprive Plaintiff of the equal protection of the laws in violation of 42 U.S.C. § 1985. Id. ¶¶ 95-98.
Defendants oppose Plaintiff's motion to file a supplemental complaint on the grounds that to allow it would be futile. Defs.' Opp'n Mot. Leave to Suppl. Compl., ECF No. 19.
Under Federal Rule of Civil Procedure 15, if a plaintiff wants to amend his complaint more than 21 days after a responsive pleading has been filed, he must seek consent from the defendants or leave from the Court. See Fed. R. Civ. P. 15(a); Virtue v. Int'l Bhd. of Teamsters Ret. & Family Prot. Plan, 893 F.Supp.2d 46, 47-48 (D.D.C.2012). Pursuant to Rule 15, a court should grant leave to amend a complaint when "justice so requires." Fed. R. Civ. P. 15(a)(2); see also Willoughby v. Potomac Elec. Power Co., 100 F.3d 999, 1003 (D.C.Cir.1996). However, a court may deny a motion to amend if the amendment would be futile. Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962); see James Madison Ltd. v. Ludwig, 82 F.3d 1085, 1099 (D.C.Cir.1996). "An amendment would be futile if it merely restates the same facts as the original complaint in different terms, reasserts a claim on which the court previously ruled, fails to state a legal theory or could not withstand a motion to dismiss." Robinson v. Detroit News, Inc., 211 F.Supp.2d 101, 114 (D.D.C.2002); see also Oladokun v. Corr. Treatment Facility, 5 F.Supp.3d 7, 13 (D.D.C.2013) ("[I]n assessing an argument that an amendment would be futile, the court must assess the proposed
Unlike an amended complaint, which "typically rest on matters in place prior to the filing of the original pleading," United States v. Hicks, 283 F.3d 380, 385 (D.C.Cir.2002), a supplemental complaint sets forth "transaction[s], occurrence[s], or event[s] that happened after the date of the pleading to be supplemented." Fed. R. Civ. P. 15(d). A supplemental complaint is used "to set forth new facts that update the original pleading or provide the basis for additional relief; to put forward new claims or defenses based on events that took place after the original complaint or answer was filed; [and] to include new parties where subsequent events have made it necessary to do so." Hicks, 283 F.3d at 386 (citing 6A Charles Alan Wright, Arthur R. Miller & Mary Kay Kane, Federal Practice and Procedure § 1504 (3d ed.2010)).
Before filing a supplemental complaint, a plaintiff must first seek the Court's permission. Hall v. C.I.A., 437 F.3d 94, 100 (D.C.Cir.2006) ("Such supplements always require leave of the court."); see also Fed. R. Civ. P. 15(d) (providing that a court "may, on just terms, permit a party to serve a supplemental pleading"). A motion to supplement a pleading is "to be freely granted when doing so will promote the economic and speedy disposition of the entire controversy between the parties, will not cause undue delay or trial inconvenience, and will not prejudice the rights of any of the other parties to the action." Hall, 437 F.3d at 101 (internal quotation marks omitted). As is the case when a plaintiff seeks leave to amend a complaint, however, a court may deny a motion to file a supplemental complaint as futile "if the proposed claim[s] would not survive a motion to dismiss." Hettinga v. United States, 677 F.3d 471, 480 (D.C.Cir.2012) (affirming denial of leave to file a supplemental complaint); Oladokun, 5 F.Supp.3d at 13 (explaining that when a party argues that a claim is futile because it would not survive a motion to dismiss, the claim is analyzed "under the same standard as would be applied to a motion to dismiss" pursuant to Rule 12(b)(6)).
The Federal Rules of Civil Procedure require that a complaint contain "a short and plain statement of the claim" in order to give the defendant fair notice of the claim and the grounds upon which it rests. Fed. R. Civ. P. 8(a)(2); accord Erickson v. Pardus, 551 U.S. 89, 93, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007) (per curiam). A motion to dismiss under Rule 12(b)(6) does not test a plaintiff's ultimate likelihood of success on the merits; rather, it tests whether a plaintiff has properly stated a claim. See Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974). A court considering such a motion presumes that the complaint's factual allegations are true and construes them liberally in the plaintiff's favor. See, e.g., United States v. Philip Morris, Inc., 116 F.Supp.2d 131, 135 (D.D.C.2000). It is not necessary for the plaintiff to plead all elements of its prima facie case in the complaint. See Swierkiewicz v. Sorema N.A., 534 U.S. 506, 511-14, 122 S.Ct. 992, 152 L.Ed.2d 1 (2002); Bryant v. Pepco, 730 F.Supp.2d 25, 28-29 (D.D.C.2010).
Nevertheless, "[t]o survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to `state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). This means that a plaintiff's
Defendants first argue that this Court should strike Plaintiff's amended complaint—with the exception of those claims for which Plaintiff received the Court's leave to amend—because Plaintiff failed to abide by the requirements of Federal Rule of Civil Procedure 15(a). Rule 15(a) provides that a plaintiff "may amend its pleading only with the opposing party's written consent or the court's leave," Fed. R. Civ. P. 15(a)(2) (emphasis added), and Plaintiff obtained neither. By way of response, Plaintiff argues that it had already received the Court's leave to amend its First Amendment and Equal Protection Clause claims, and it is aware of "no authority for the proposition that once leave is granted to a Plaintiff to amend a Complaint, such amendments are somehow confined to the exceptions specifically noted by the Court in granting the amendment." Pl.'s Opp'n to Mot. Strike at 1-2, ECF No. 16.
To find such authority, Plaintiff need only have consulted the plain language of this Court's March 31, 2014, Order. In that Order, the Court clearly stated that "Plaintiff is granted leave to amend its claims brought pursuant to the Equal Protection Clause and the First Amendment."
This is not the first time that Plaintiff has attempted to amend its complaint in an improper manner. Indeed, the Court's limited grant of leave to amend was intended to allow Plaintiff to correct precisely that problem. As the Court's Memorandum Opinion explained, Plaintiff's brief in opposition to Defendants' motion to dismiss contained new facts pertinent to its First Amendment and Equal Protection Clause claims that did not appear in Plaintiff's complaint. BEG Investments, 34
Once more, however, Plaintiff has attempted to amend its complaint in an impermissible manner, this time by ignoring the limitations of this Court's Order and failing to comply with Federal Rule of Civil Procedure 15(a). Plaintiff is correct that "this Court has denied motions to strike amended pleadings when a party intended to comply with, and did not cavalierly disregard, a scheduling order," Greggs v. Autism Speaks, Inc., 987 F.Supp.2d 51, 54 (D.D.C.2014), but Plaintiff has given no indication that this is such a case. Plaintiff is represented by counsel, and in the event that Plaintiff's attorney was unfamiliar with the requirements of Rule 15(a), Defendants' motion to strike the amended complaint clearly set forth those requirements. To this day, however, Plaintiff has not sought leave to amend its complaint. Neither has Plaintiff suggested a plausible reading of the Court's Order that would authorize Plaintiff to amend all claims, and the Court is at a loss to supply one.
Plaintiff's final effort to defend its course of action is to assert that "Defendants' hypertechnical and baseless claim that the Plaintiff violated Rule 15(a) will matter little to anyone" when Plaintiff files its supplemental complaint, which "will make these amendments pale in comparison." See Pl.'s Opp'n Mot. Strike at 3. Though Plaintiff's clear violation of the Rules of Civil Procedure and this Court's Order may "matter little" to Plaintiff, the Court does not share this view. If Plaintiff viewed the Court's sua sponte grant of leave to amend as too narrow, Plaintiff was free to seek the Court's leave to make additional amendments. Plaintiff was not, however, free to simply ignore the limitations of the Court's Order and the requirements of the Federal Rules.
The Court therefore grants Defendants' motion to strike Counts I, II, and V—Plaintiff's RICO and Fifth Amendment claims—from the amended complaint. See Purchasing Power, LLC v. Bluestem Brands, Inc., 22 F.Supp.3d 1305, 1320-21 (N.D.Ga.2014) (dismissing two counts of an amended complaint where the plaintiff did not seek the Court's leave to amend as required by Rule 15(a)(2), and the claims were not among those that the Court's order previously gave plaintiff leave to amend); Pinson v. U.S. Dep't of Justice, 975 F.Supp.2d 20, 28 (D.D.C.2013) (striking second amended complaint filed without first seeking court's leave); see also United States ex rel. Mathews v. Health-South Corp., 332 F.3d 293, 296 (5th Cir. 2003) ("[F]ailing to request leave from the court when leave is required makes a pleading more than technically deficient. The failure to obtain leave results in an amended complaint having no legal effect."); Murray v. Archambo, 132 F.3d 609, 612 (10th Cir.1998) ("Because Murray's amended complaint was not properly filed pursuant to Rule 15 [because he failed to seek leave of court or consent of defendants before filing], it had no legal effect. . . .").
Alternatively, even if Plaintiff had sought leave to amend Counts I, II, and V
As Defendants correctly point out, the RICO and RICO conspiracy claims in Plaintiff's amended complaint are virtually identical to those previously considered and dismissed by this Court, reflecting only two changes. First, in the "relevant facts" section of Plaintiff's amended complaint, Plaintiff adds that "[i]n some instances, an establishment will schedule and pay for the Reimbursable Detail, but no officers will show up for the detail." Am. Compl. ¶ 26. Second, Plaintiff has added to Count I the assertion of an interstate commerce nexus. See id. ¶ 107(e) ("By demanding payment to Reimbursable Detail program for the purpose of extorting money from the Plaintiff, the Defendants have obstructed, delayed, and affected commerce within the District of Columbia in violation of the Hobbs Act, 18 U.S.C. § 1951."). Count II, alleging a RICO conspiracy, is entirely unchanged from Plaintiff's first complaint. Compare Compl. ¶¶ 87-90 with Am. Compl. ¶¶ 108-11.
Plaintiff asserts generally that it "has endeavored to address and rehabilitate [its claims] to the Court's satisfaction." See Pl.'s Opp'n Mot. Strike at 2. But Plaintiff offers no argument or explanation as to how either of Plaintiff's proposed amendments could be considered responsive to the basis of this Court's earlier dismissal of Plaintiff's RICO claims against Defendants in their individual capacities. The Court did not dismiss the claims due to Plaintiff's failure to allege either the existence of an interstate commerce nexus or the occasional unreliability of reimbursable details. Rather, the Court found that Defendants were "entitled to qualified immunity on the RICO and Hobbs Act claims because Plaintiff has failed to allege that Defendants' imposition of a Reimbursable Detail violated clearly established law." BEG Investments, 34 F.Supp.3d at 80. Plaintiff's proposed amendments do not change this conclusion. Thus, the Court finds that Plaintiff's RICO claims are unable to survive a motion to dismiss on qualified immunity grounds, see id. at 80-84, and that Plaintiff's proposed RICO and RICO conspiracy claims against Defendants in their individual capacities would be futile. See Robinson, 211 F.Supp.2d at 114 ("An amendment would be futile if it merely . . . reasserts a claim on which the court previously ruled. . . .").
Plaintiff's RICO claims against Defendants in their official capacities, presented for the first time in the amended complaint, are just as infirm as Plaintiff's individual capacity claims. "Because the real party in interest in an official-capacity suit is the governmental entity and not the named official," Hafer v. Melo, 502 U.S. 21, 25, 112 S.Ct. 358, 116 L.Ed.2d 301 (1991), Plaintiff's RICO claims against the Board members in their official capacities are effectively RICO claims against the District of Columbia. Defendants maintain that this is a fatal defect, because a civil RICO claim "cannot be maintained against a municipal corporation." Genty v. Resolution Trust Corp., 937 F.2d 899, 914 (3d Cir.1991).
In Newport v. Fact Concerts, Inc., 453 U.S. 247, 101 S.Ct. 2748, 69 L.Ed.2d 616 (1981), the Supreme Court described the well-established common law proposition that municipal corporations are immune from punitive damages. Id. at 259-63, 101 S.Ct. 2748. The Court explained that "officials' malice should not be attributed to the taxpaying citizens of the community" via an award of punitive damages. See id. at 261, 101 S.Ct. 2748. The Court also cited with approval a state supreme court opinion finding that "a municipality could not be found liable for treble damages under a trespass statute, notwithstanding the statute's authorization of such damages against `any person,'" because municipal corporations, unlike their officers, cannot commit willful and malicious acts. See id. (citing Hunt v. City of Boonville, 65 Mo. 620, 625 (1877)). The Court went on to observe that "[j]udicial disinclination to award punitive damages against a municipality has persisted to the present day in the vast majority of jurisdictions," id. at 260, 101 S.Ct. 2748, and that "[t]he general rule today is that no punitive damages are allowed unless expressly authorized by statute." Id. at 260 n. 21, 101 S.Ct. 2748; see also Smith v. District of Columbia, 336 A.2d 831, 832 (D.C.1975) (per curiam) (holding that the "District of Columbia is not liable for punitive damages").
Applying the Supreme Court's municipal immunity analysis to RICO, the Third Circuit observed in Genty that RICO requires an award of treble damages, "a civil remedy far in excess of the amount necessary to compensate an injured RICO victim." Genty, 937 F.2d at 912. "[B]earing in mind the strong weight of authority which supports the characterization of treble damages as punitive," as well as the absence of any express statutory language providing for municipal liability, the Genty court held "that RICO's overall purpose to thwart the generalized harm wrought by racketeering activity, its dependence on statutory crimes, and the mandatory provision for treble damages are sufficient evidence of Congress' intention that the treble damages provision serve a predominantly punitive purpose." Id. at 914. As a consequence, the court concluded that a civil RICO claim could not be maintained against a municipal corporation. Id. at 914; see also Tengood v. City of Philadelphia, 529 Fed.Appx. 204, 209 (3d Cir.2013) (applying Genty and affirming dismissal of civil RICO claims against a city); Navajo Nation v. Peabody Holding Co., 209 F.Supp.2d 269, 272 (D.D.C.2002) (describing the Court's earlier grant of a motion to dismiss RICO claims against a municipal corporation that could not be liable under RICO for punitive damages).
The Third Circuit is not alone in finding municipal corporations immune from civil RICO liability. In Lancaster Community Hospital v. Antelope Valley Hospital District, 940 F.2d 397 (9th Cir.1991), the Ninth Circuit held that RICO claims brought against government entities must
The Second Circuit has also rejected claims that a municipality can be liable under RICO. See Rogers v. City of New York, 359 Fed.Appx. 201, 204 (2d Cir.2009) (citing Pedrina and holding that "there is no municipal liability under RICO"); Frooks v. Town of Cortlandt, 997 F.Supp. 438, 457 (S.D.N.Y.1998) aff'd, 182 F.3d 899 (2d Cir.1999) (noting that "every court in this Circuit that has considered the issue has held that a municipality cannot form the requisite criminal intent to establish a predicate act, and has therefore dismissed the claim against the municipality").
Against the weight of opinions from the Second, Third, and Ninth Circuits,
Plaintiff's reliance on First American, a case that did not address the subject of municipal liability under RICO, is unavailing. The Court in First American considered the question of whether RICO is primarily punitive or remedial only for the purpose of determining whether a civil RICO suit could survive the death of the defendant. Id. at 1122. Additionally, First American expressly distinguished the facts in Genty, where the treble damages provision was punitive because the case involved "potential municipal liability where actual damages were easily calculated," from the facts in First American, where "the actual damages arising from a specific defendant's actions may be difficult to assess." Id. Plaintiff, however, has not suggested that the actual damages caused by the District in this case may be difficult to assess, and the Court has no reason to doubt that damages could be easily calculated based on the payments Plaintiff made to the Reimbursable Detail.
Similarly, even if Plaintiff had sought leave to amend its Fifth Amendment Takings Clause claim, the Court would have denied the amendment as futile. Plaintiff's Takings Clause claim, Count V, is premised on the Board's order requiring Plaintiff to hire reimbursable details, thereby requiring Plaintiff to pay MPD thousands of dollars for policing services. Am. Compl. §§ 125-130. This Court previously dismissed Count V for failure to state a claim, explaining that "a mere payment of money, without more, is not a taking within the meaning of the Takings Clause." BEG Investments, 34 F.Supp.3d at 87. Plaintiff's amended complaint adds a single assertion to those allegations previously found inadequate by the Court: "Defendants have forced the Plaintiff to pay extortionate monetary payments to receive business permits without any legitimate governmental purpose." Am. Compl. ¶ 129. Defendants, in response, have argued that res judicata bars the claim, and they have incorporated by reference their prior arguments for dismissing Count V for failure to state a claim under the Fifth Amendment. See Defs.' Mot. Strike at 8-9, 9 n.5.
Plaintiff's opposition, however, offers no counter-argument on the subject; indeed, Plaintiff's opposition is devoid of any reference whatsoever to the Fifth Amendment generally or Plaintiff's Takings Clause claim specifically. In light of Plaintiff's failure to respond to Defendants' arguments in favor of striking or dismissing the Takings Clause claim as futile, the Court shall treat the matter as conceded. See Local Civil Rule 7(b); Jordan v. District of Columbia, 949 F.Supp.2d 83, 91 (D.D.C. 2013) (dismissing two claims because "[b]y failing to respond in their opposition, the plaintiffs have conceded [the defendant's] argument"); Hopkins, 284 F.Supp.2d 15, 25 (D.D.C.2003) ("[W]hen a plaintiff files an opposition to a dispositive motion and addresses only certain arguments raised by the defendant, a court may treat those arguments that the plaintiff failed to address as conceded.").
New to Plaintiff's amended complaint is Count IV, a claim that alleges a violation of Title VI of the Civil Rights Act of 1964, 42 U.S.C. § 2000d. Although Plaintiff did not seek leave to amend its complaint to include a claim of race discrimination under Title VI, like the Equal Protection Clause, Title VI prohibits only intentional discrimination. Alexander v. Sandoval, 532 U.S. 275, 280-81, 121 S.Ct. 1511, 149 L.Ed.2d 517 (2001); see also Gratz v. Bollinger, 539 U.S. 244, 276 n. 23, 123 S.Ct. 2411, 156 L.Ed.2d 257 (2003) (holding that "discrimination that violates the Equal Protection Clause of the Fourteenth Amendment committed by an institution that accepts federal funds also constitutes a violation of Title VI"); Regents of Univ. of Cal. v. Bakke, 438 U.S. 265, 287, 98 S.Ct. 2733, 57 L.Ed.2d 750 (1978) ("Title VI must be held to proscribe only those racial classifications that would violate the Equal Protection Clause or the Fifth Amendment."). And Plaintiff's allegations in support of its Equal Protection Clause claims, which the Court did grant Plaintiff leave to amend, are virtually identical to the allegations offered in support of Plaintiff's Title VI claim. Compare Am. Compl. ¶ 114 (alleging Equal Protection Clause violation on the basis of the imposition of reimbursable details "to unlawfully inhibit the free assembly of minorities . . . and to unlawfully inhibit the performance of certain kinds of music") with id. ¶ 119 (alleging Title VI violation on the basis of the imposition of reimbursable details "for the purpose of inhibiting the free association of young black African Americans and to inhibit the playing of `urban' styles of music").
Accordingly, in the interests of justice and in the absence of any demonstrated prejudice to Defendants, the Court will treat the addition of Plaintiff's Title IV claim as an amendment of Plaintiff's Equal Protection Clause claims permitted by this Court's Order.
Defendants next assert that Counts III, IV, and VII, which assert violations of the Equal Protection Clause,
Defendants contend that these allegations are not enough to make out a plausible claim for relief under the Equal Protection Clause, Title VI, or § 1985. Specifically, Defendants point out that aside from a conclusory assertion that "not all other similarly situated businesses" were subject to a reimbursable detail condition, Plaintiff has not alleged any facts to suggest that any establishment similarly situated to Plaintiff's, but for some protected category, was treated differently by the Board. Defs.' Mot. Strike at 13-16. Without such allegations, Defendants contend, Plaintiff has failed to state a plausible discrimination claim.
Plaintiff counters that it has adequately alleged facts showing "palpable discriminatory animus," citing four paragraphs of its complaint that describe the Board's regulation of an establishment owned by a non-party. Pl.'s Opp'n Mot. Strike at 14-15. In those paragraphs, Plaintiff alleges that the Board voted to continue the suspension of an establishment's license until the establishment "provided to them the names of band members of two Go-Go bands," that the Board required the establishment "to submit a list of its entertainment events . . . on a monthly basis," that the establishment "submitted a proffer letter" to the Board stating that it would not employ the two Go-Go bands at issue, and that the Board accepted the proffer and permitted the reestablishment to reopen on that basis. Am. Compl. ¶¶ 101-04. Accepting these allegations as true, one could infer that the Board harbors animus towards certain Go-Go bands, and that when restricting the abilities of those bands to perform at a particular establishment, it may have violated the rights of individuals who are not parties to this litigation. But such inferences are insufficient to support Plaintiff's claims that the Board violated the rights of Plaintiff and Plaintiff's patrons by imposing reimbursable details in a discriminatory manner on the basis of race and musical genre.
In Ashcroft v. Iqbal, 556 U.S. 662, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009), the Supreme Court explained that to survive a motion to dismiss, a complaint must offer "more than a sheer possibility that a defendant has acted unlawfully." Id. at 678, 129 S.Ct. 1937. "Where a complaint pleads facts that are merely consistent
A careful review of Plaintiff's amended complaint shows that it lacks adequate factual allegations to make its conclusory assertions of discrimination plausible rather than merely possible. The Court accepts as true Plaintiff's non-conclusory assertions that five establishments in the District of Columbia, including Plaintiff's, that play primarily R & B, Hip-Hop, and Go-Go Music and that are patronized primarily by African-Americans, have been required to hire reimbursable details. Missing from Plaintiff's complaint, however, are any factual allegations supporting its conclusory allegations of discriminatory intent and differential treatment. For example, Plaintiff does not allege that Defendants have placed any genre- or band-related restrictions on Plaintiff, or even that the Board was aware that Plaintiff played R & B, Go-Go, and Hip-Hop music. And the only mention of musical genres in the Board's Order imposing the reimbursable detail condition on Plaintiff is a factual summary of the testimony of the establishment's manager, who said that "[o]cassionally, the establishment. . . has jazz groups perform on Sundays." See Board Order 2011-289 at 4, Defs.' Ex. A. Additionally, Plaintiff has failed to allege that the Board members who imposed the reimbursable condition, professedly in the interest of public safety following reports of multiple violent incidents at Plaintiff's establishment, were aware that the majority of Plaintiff's patrons were African American.
The amended complaint is also devoid of any factual allegations suggesting that similar establishments that were patronized primarily by other races or that played primarily other genres of music were not subject to reimbursable detail conditions. Plaintiff's conclusory assertion that the Board imposed reimbursable detail conditions on "Plaintiff but not all similarly situated businesses," Am. Compl. ¶ 115, is no substitute for factual allegations. See Mpras v. District of Columbia, No. 2014-CV-00220, 74 F.Supp.3d 265, 271, 2014 WL 6603303, at *5 (D.D.C.2014) (rejecting as conclusory the complaint's allegation that the plaintiff was treated differently from those "similarly situated" where complaint did not allege any supporting facts "about who these other persons are or how they were similarly situated"); Kingman Park Civic Ass'n v. Gray, 27 F.Supp.3d 142, 159 (D.D.C.2014) (holding that plaintiff's failure "to identify any neighborhood, much less one that is a similarly situated . . . that has been treated more favorably . . . is insufficient to demonstrate a racially discriminatory purpose
Plaintiff does allege that its "attorney's research has indicated no kind of imposition of police details upon establishments not catering to young black African Americans," but it does so only in its opposition brief. Pl.'s Opp'n Mot. Strike at 14. As this Court previously informed Plaintiff, however, "the Court cannot consider facts alleged in the briefing when ruling on a Motion to Dismiss. `It is axiomatic that a complaint may not be amended by the briefs in opposition to a motion to dismiss.'" BEG Investments, 34 F.Supp.3d at 85 (quoting Coleman v. Pension Benefit Guar. Corp., 94 F.Supp.2d 18, 24 n. 8 (D.D.C.2000)).
Plaintiff also protests that it is not its burden at any point in this litigation to "prove a negative," and that it should be the Defendants' burden to come forward with evidence that establishments patronized by other races were treated similarly. See Pl.'s Opp'n. Mot. Strike at 14. Plaintiff then cites a series of cases suggesting that a party ought not be required to prove a negative, and that the preferred approach is to put "the burden of coming forward with evidence on the party with superior access to the affirmative information." Sissoko v. Rocha, 440 F.3d 1145, 1162 (9th Cir.2006) opinion withdrawn and superseded on denial of reh'g, 509 F.3d 947 (9th Cir.2007).
As Defendants point out, however, Board orders—including those imposing reimbursable detail conditions on other establishment—are publically available, and indeed, Plaintiff cites a number of them in its amended complaint. More to the point, burdens of proof and production are irrelevant to the issue at hand: Plaintiff's pleading obligations.
The last remaining claim in Plaintiff's amended complaint is Count VI, which alleges that Defendants' imposition of the reimbursable detail condition unconstitutionally burdened Plaintiff's First Amendment right to play certain kinds of music at its establishment. Am. Compl. ¶¶ 131-36. After noting that "[r]egulations enacted for the purpose of restraining speech on the basis of content presumptively violate the First Amendment," Plaintiff alleges that Defendants exercised their "unlimited discretion to impose reimbursable details upon the Plaintiff" in a manner that "imposes burdens upon its establishment for playing certain types of music." Id. ¶¶ 132, 136; see also Pl.'s Opp'n Mot. Strike at 20 (arguing that the "Board is impermissibly driving certain ideas or viewpoints from nightclubs in the District"). Plaintiff adds that its "establishment plays music specifically for the enjoyment of young black African Americans," Am. Compl. ¶ 135, and that its music consists "mostly of R & B, Hip-Hop and Go-Go music," id. ¶ 30.
In their motion to dismiss, Defendants argue that Plaintiff's First Amendment claim is, in fact, a selective enforcement claim cognizable under the Equal Protection Clause and not the First Amendment. Defs.' Mot. Strike at 12-13. Defendants note that although Plaintiff's complaint recites legal provisions applicable to the First amendment and "content-based regulations," Plaintiff does not actually allege that the Board's order imposing the reimbursable detail was itself content-based. See id. at 12. Instead, Plaintiff alleges that the Board has exercised its regulatory power unconstitutionally by imposing reimbursable detail conditions on certain establishments in an effort to discourage them from playing certain kinds of music. Because Plaintiff's claim is a selective enforcement claim, Defendants contend, it must be analyzed pursuant to Equal Protection Clause jurisprudence, and because Plaintiff has failed to allege that it was singled out from similarly situated establishments, the "First Amendment" claim must be dismissed. Id. at 12-16. Alternatively, Defendants argue that to the extent Plaintiff truly did intend to state a First Amendment claim, it has failed to do so because neither the statute that authorized the Board to act nor the condition that the Board imposed regulates or references content, and the stated purpose for asserting the condition was the content-neutral governmental interest in curbing violence and noise. Defs.' Mot. Strike at 12 n.8.
The precise nature of Plaintiff's First Amendment claim is not immediately obvious from the amended complaint, which first cites legal principles applicable to content-based regulations that must be analyzed with strict scrutiny, Am. Compl. ¶¶ 132-33, and then complains of the Board's exercise of its "unlimited discretion" to burden Plaintiff's establishment "for playing certain types of music," Am. Compl. ¶ 136. Plaintiff's opposition brief, which contains multiple pages of case citations, summaries, and quotations—the applicability of which Plaintiff does not
To the extent that Plaintiff's amended complaint could be read as suggesting that the reimbursable detail condition on Plaintiff's liquor license is an unconstitutional "content-based regulation," Plaintiff's claim fails. "Content-based laws are . . . `presumptively invalid, and the government bears the burden to rebut that presumption.'" Act Now to Stop War & End Racism Coal. v. District of Columbia, 798 F.Supp.2d 134, 145-46 (D.D.C.2011) (quoting United States v. Playboy Entm't Grp. Inc., 529 U.S. 803, 817, 120 S.Ct. 1878, 146 L.Ed.2d 865 (2000)). But Plaintiff does not allege—and the condition itself does not reflect—that the Board imposed any restrictions whatsoever on the content or genre of music that Plaintiff may play while maintaining its liquor license. According to the Board's order, Plaintiff was required to hire a reimbursable detail only if it elected to provide certain forms of live entertainment—a DJ or live music—regardless of whether the music played was go-go or gospel. See Board Order 2011-289 at 5-7, Defs.' Ex. A. Furthermore, the Board's explanation for its imposition of the condition was content-neutral. See id. (expressly stating that the Board was imposing the reimbursable detail condition to alleviate "negative impacts on the neighborhood" and in response to "concerns regarding the establishment's effect on peace, order, and quiet" after "a number of violent incidents . . . occurred at the establishment").
There is thus no question that the reimbursable detail condition is facially content-neutral, impacting indirectly only the "time, place or manner of expression," purportedly for the purpose of ameliorating the establishment's negative effects on the surrounding neighborhood. Cf. Ward v. Rock Against Racism, 491 U.S. 781, 792, 109 S.Ct. 2746, 105 L.Ed.2d 661 (1989) (holding that where a sound-amplification guideline was justified by "the city's desire to control noise levels[,] . . . to retain the character of the [area], and to avoid undue intrusion into residential areas," the justification had "nothing to do with content and . . . satisfie[d] the requirement that time, place, or manner regulations be content neutral" (internal quotation marks and citation omitted)). The Board order imposing the condition proffers substantial, content-neutral justifications for imposing the reimbursable detail condition on Plaintiff after reports of violent incidents and intoxicated patrons disturbing the neighborhood. See Board Order 2011-289 at 5-7, Defs.' Ex. A. And Plaintiff has not alleged that the condition has limited its alternative avenues of expression or communication, let alone that it has done so unreasonably. See City of Renton v. Playtime Theatres, Inc., 475 U.S. 41, 47, 106 S.Ct. 925, 89 L.Ed.2d 29 (1986) ("`[C]ontent-neutral' time, place, and manner regulations are acceptable so long as they are designed to serve a substantial governmental interest and do not unreasonably limit alternative avenues of communication.").
Nevertheless, this Court recognized in its prior Memorandum Opinion that even a content-neutral regulation like a reimbursable detail requirement could be selectively applied in a content-discriminatory way, and it gave Plaintiff leave to amend its First Amendment claim to allege facts supporting a theory of selective enforcement. See BEG Investments, 34 F.Supp.3d. at 86 ("In essence, the Plaintiff attacks the unwritten discriminatory policy, only manifested by the Board's application of its statutory authority. See, e.g., Tipton v. Univ. of Hawaii, 15 F.3d 922, 927 (9th Cir.1994)).
The circuit courts have expressed a range of opinions regarding whether a selective enforcement claim is properly considered a First Amendment or Equal Protection Clause claim. Compare McGuire v. Reilly, 386 F.3d 45, 61 (1st Cir.2004) (treating as a First Amendment as-applied challenge a claim "based on the idea that the law itself is neutral and constitutional in all fact situations, but that it has been enforced selectively in a viewpoint discriminatory way") with Hoye v. City of Oakland, 653 F.3d 835, 855 (9th Cir.2011) (explaining that the court "generally classified such challenges as selective enforcement equal protection claims"). In Sanjour v. EPA, 56 F.3d 85 (D.C.Cir.1995), this Circuit held that selective enforcement claims are properly analyzed as Equal Protection Clause claims, and that even if a plaintiff alleges that selective enforcement was intended
As a consequence, Plaintiff must allege sufficient factual matter to show that the Board's purportedly content-discriminatory exercise of its authority to impose license conditions "singled [Plaintiff] out from others similarly situated" or that the application of the condition to Plaintiff was improperly motivated by the Board's desire to discriminate against the viewpoint conveyed by the music played in Plaintiff's nightclub. See id. (quoting Juluke v. Hodel, 811 F.2d 1553, 1561 (D.C.Cir.1987)); see also Hoye, 653 F.3d at 855 ("Under both the First Circuit's `as-applied' approach and our standard `selective enforcement' approach, a plaintiff must show that a municipality's content-discriminatory enforcement of an ordinance is the result of an intentional policy or practice."). But as described above in Part IV.D of this Opinion, Plaintiff has not provided factual allegations to suggest that the Board treated similarly situated establishments—i.e., establishments like Plaintiff's but for the fact that they did not play primarily Hip-Hop, R & B, and Go-Go music—any differently. Indeed, the only establishment that Plaintiff does not allege was subject to a reimbursable detail condition played the very same types of music as did Plaintiff for patrons of the same race. See Am. Compl. ¶ 98.
And although Plaintiff contends that the condition was imposed to discriminate against its playing of primarily Hip-Hop, R & B, and Go-Go music for the enjoyment of African-Americans, Plaintiff has failed to allege any facts suggesting that the Board knew that Plaintiff favored those types of music when it imposed the condition, let alone any facts supporting a plausible claim of discriminatory intent. See Board Order 2011-289 at 4, Defs.' Ex. A (finding that "[o]cassionally, the establishment. . . has jazz groups perform on Sundays," but not identifying any other genres of music played at Plaintiff's establishment). In short, Plaintiff has not alleged any facts to support the conclusory allegation that the Board imposed the reimbursable detail condition on Plaintiff with the intent to inhibit it from playing certain types of music. As discussed in Part IV.D of this Opinion, the failure to allege such facts is fatal to Plaintiff's discriminatory enforcement claim.
Having found no theory under which Plaintiff's First Amendment claim could be viewed as stating a plausible claim for relief, the Court grants Defendants' motion to dismiss Count VI.
The Court next addresses Plaintiff's motion for leave to file a supplemental complaint setting forth additional claims based on "transaction[s], occurrence[s], or event[s] that happened after the date of the pleading to be supplemented." Fed.
Defendants oppose Plaintiff's motion to supplement, arguing that granting Plaintiff leave to supplement its complaint with the above-described claims would be futile, because the claims would not survive a motion to dismiss under Rule 12(b)(6). Defendants offer an array of arguments in favor of a finding of futility, including that: (1) all of the Board members are entitled to quasi-judicial immunity for their actions at show cause hearings; (2) quasi-prosecutorial immunity bars a § 1983 claim against Ms. Schmidt in her individual capacity for her actions taken while representing the government before the Board; (3) Plaintiff's First Amendment retaliation claim against Ms. Schmidt for fabricating and prosecuting a false noise complaint is futile because the complaint was investigated four months before this suit was filed; (4) pursuant to the Younger abstention doctrine, the Court cannot exercise jurisdiction over Plaintiff's First Amendment claim relating to the closure of its establishment on June 6, 2014, because those Board proceedings are ongoing; (5) Plaintiff has failed to allege sufficient facts to state a First Amendment retaliation claim for the closure of its establishment on May 14, 2014; (6) Sergeant Pope is entitled to absolute immunity from Plaintiff's defamation claims; (7) Plaintiff failed to state a claim for defamation because the alleged statements were not inherently defamatory and Plaintiff failed to make particularized allegations of harm; and (8) the § 1985 claim contains only a formulaic recitation of the elements of the cause of action and fails to state a plausible claim for relief. See generally Defs.' Opp'n Mot. Suppl., ECF No. 19.
In reply to Defendants' twenty-page brief arguing that all of Plaintiff's supplemental claims are futile and should not be permitted, Plaintiff makes only two responsive arguments: (1) futility analysis is not appropriate when considering a supplemental complaint, and (2) Defendants' factual denials of the allegations supporting Plaintiff's First Amendment retaliation claims should not be considered. Pl.'s Reply at 3-4, ECF No. 20. Plaintiff makes no response whatsoever to Defendants' arguments pertaining to immunity, Younger abstention, failure to state a defamation claim, or failure to state a § 1985 claim. Instead, Plaintiff has pinned its hopes on its belief that "Defendants' futility analysis has no place in the supplementation of a complaint." Id. at 3. Plaintiff is mistaken.
The case law of this Circuit confirms that futility is an appropriate basis for denying a motion for leave to supplement a complaint. See, e.g., Hettinga v. United States, 677 F.3d 471, 480 (D.C.Cir.2012) (affirming district court's decision to deny leave to file a supplemental complaint because "[t]he proposed amendments would have been futile"); Nat'l ATM Council, Inc. v. Visa Inc., 7 F.Supp.3d 51, 57 (D.D.C.2013) ("[A] court does not abuse its discretion if it denies leave to amend or
Plaintiff's argument to the contrary is devoid of merit and relies entirely on two out-of-circuit cases, both of which flatly contradict Plaintiff's position. In Quaratino v. Tiffany & Co., 71 F.3d 58 (2d Cir. 1995), the Second Circuit explicitly recognized that "futility" was a basis for denying a motion to supplement a pleading, but the court found that leave to supplement would not have been futile in that case. Id. at 65-66. Similarly, Saratoga Potato Chips Co. v. Classic Foods, Inc., No. 1:12-CV-452, 2014 WL 2930495 (N.D.Ind. June 27, 2014), does not, as Plaintiff incorrectly asserts, "reject[] futility analysis in a supplemental complaint." Pl.'s Reply at 3. Rather, the district court in that case recognized futility of amendment as a basis for denying leave to supplement, conducted a futility analysis, and determined that with the exception of two claims, granting leave to supplement would not be futile. Saratoga Potato Chips Co., 2014 WL 2930495, at *2-6. Accordingly, the Court will proceed to consider Defendants' arguments that Plaintiff's motion to supplement its complaint should be denied on the basis of futility.
The first claim in Plaintiff's supplemental complaint is brought against Ms. Schmidt, an OAG attorney, in her individual capacity. Plaintiff alleges that Ms. Schmidt "fabricated a noise complaint and procured false testimony against the Plaintiff" at a hearing before the Board on January 15, 2014, in retaliation for Plaintiff's filing of this lawsuit and in violation of Plaintiff's First Amendment rights. Suppl. Compl. ¶¶ 6-24, 58-63. Plaintiff alleges that it did not receive notice of a noise complaint said to have occurred on July 26, 2012, and described in an ABRA investigative report finalized on August 28, 2012, until March 13, 2013—approximately one month after Plaintiff filed this suit. Id. ¶¶ 6-9. Additionally, Plaintiff notes that although the investigative report did not state the time that the alleged violation occurred on July 26, the notice that Plaintiff received stated that it occurred at approximately 2:15 AM, and Ms. Schmidt later stated at hearing that 2:15 was a "misprint," and that the alleged complaint occurred between 11:30 PM and midnight. Id. ¶¶ 8-12. Based on the delayed notice and inconsistent allegations regarding the time of the noise complaint, Plaintiff believes that July 26 complaint was fabricated by Ms. Schmidt and persons unknown after Plaintiff filed this suit. See id. ¶ 59.
Plaintiff further states that at a show cause hearing before the Board on January 15, 2014, ABRA investigator Earl Jones, who claims to have investigated the complaint and who signed the August 28 investigative report, testified under oath that he responded to the noise complaint on July 26, 2012, and that he interviewed a complainant who said that she could hear music from Plaintiff's establishment in her home. See id. ¶¶ 13-14; Board Hearing Transcript, Jan. 15, 2014, at 43-48, Defs.' Ex. E, ECF No. 19-2; ABRA Investigative Report at 184-88, Defs.' Ex. N, ECF No. 19-2. Investigator Jones produced photographs that he took of the complainant's home and Plaintiff's establishment, but he was unable to recall the complainant's name or her specific address at the show cause hearing, and he did not produce
Defendants contend that the First Amendment retaliation claim against Ms. Schmidt is futile as it could not survive a Rule 12(b)(6) motion for failure to state a claim. As for the assertion that Ms. Schmidt fabricated the allegations in the August 2012 ABRA investigative report in retaliation for Plaintiff's filing of this suit, Defendants argue that the report could not be retaliatory because it was finalized several months before Plaintiff initiated this suit in February 2013. Defs.' Opp'n at 10-11. As to the allegation that Ms. Schmidt procured false testimony and used fabricated evidence against Plaintiff at the January 2014 show cause hearing, Defendants argue that Ms. Schmidt is entitled to quasi-prosecutorial immunity, which "provides an absolute bar to civil liability against her in her personal capacity for any conduct—including suborning perjury—done in the course of prosecuting charges against Plaintiff." Id. at 11 (citing Imbler v. Pachtman, 424 U.S. 409, 96 S.Ct. 984, 47 L.Ed.2d 128 (1976)).
In Imbler, the Supreme Court held that a government prosecutor has absolute immunity from suit under 42 U.S.C. § 1983 for acts taken in her role as an advocate for the State. 424 U.S. at 424-31, 96 S.Ct. 984; see also Butz v. Economou, 438 U.S. 478, 515, 98 S.Ct. 2894, 57 L.Ed.2d 895 (1978) (observing that "agency officials performing certain functions analogous to those of a prosecutor should be able to claim absolute immunity with respect to such acts"); Gray v. Poole, 243 F.3d 572, 577 (D.C.Cir.2001) (holding that government attorneys have absolute immunity for their conduct in initiating and prosecuting civil child neglect cases). As Defendants point out, absolute immunity extends to the decision to prosecute, Moore v. United States, 213 F.3d 705, 709 (D.C.Cir.2000), as well as to a prosecutor's willful use of perjured testimony in proceedings against a defendant, Imbler, 424 U.S. at 431 n. 34, 96 S.Ct. 984.
Plaintiff makes no response to Defendants' argument that Ms. Schmidt is entitled to absolute immunity for her activities in presenting the District's case before the Board at the January 2014 show cause hearing. In the absence of any opposition or response to Defendants' assertion of immunity, the Court deems the matter of immunity conceded. See Cannon v. Wells Fargo Bank, N.A., 952 F.Supp.2d 1, 11 (D.D.C.2013) (holding that where a plaintiff failed to respond to the defendants' futility arguments, the Court would treat the arguments as conceded and deny leave to amend as futile); Romeo v. Aid to the Developmentally Disabled, Inc., No. 11-CV-6340, 2013 WL 1209098, at *12 (E.D.N.Y. Mar. 22, 2013) (holding that where plaintiffs sought leave to plead a new claim and defendants argued that it would be futile, plaintiff's failure to respond to defendants' arguments in their reply brief caused the court to deem plaintiff's request abandoned); see also Hopkins, 284 F.Supp.2d at 25 (holding that when a plaintiff opposes a defendants' dispositive motion but addresses only certain arguments, "a court may treat those arguments
For the reasons stated by Defendants, the Court finds that Ms. Schmidt is immune from suit for her initiation and presentation of the case against Plaintiff at the January 2015 show cause hearing before the Board. Accordingly, to the extent that Plaintiff's First Amendment claim against Ms. Schmidt is premised on the acts she took and the evidence she presented while prosecuting the noise violation against Plaintiff at the show cause hearing, the claim is futile and leave to supplement is denied.
Prosecutorial immunity does not extend, however, to Ms. Schmidt's actions pertaining to the creation or investigation of a noise complaint prior to charging and prosecuting the alleged violation. See Buckley v. Fitzsimmons, 509 U.S. 259, 273, 113 S.Ct. 2606, 125 L.Ed.2d 209 (1993) (holding that absolute immunity does not apply "[w]hen a prosecutor performs the investigative functions normally performed by a detective or police officer"). Thus, to the extent that Plaintiff's retaliation claim is premised on Ms. Schmidt's alleged fabrication of a noise complaint prior to charging Plaintiff with a violation, Ms. Schmidt is not immune from suit. See id. at 275-76, 113 S.Ct. 2606 (holding that prosecutor who allegedly fabricated evidence during the preliminary investigation of a crime was only entitled to qualified immunity, not absolute immunity). The Court therefore proceeds to the question of whether Plaintiff has adequately alleged a First Amendment retaliation claim against Ms. Schmidt for her alleged fabrication of the noise complaint against Plaintiff.
Defendants maintain that Plaintiff's claim must fail because the investigative report pertaining to the noise complaint against Plaintiff was prepared and finalized months before Plaintiff filed this suit, meaning that it could not possibly support a claim of retaliation. Defs.' Opp'n Mot. Suppl. at 10-11. In response, Plaintiff asserts that it has alleged: (1) "that it was engaged in constitutionally protected litigation against these Defendants," (2) "that since the time of the filing of the initial Complaint, the Defendants and other persons have severely injured the Plaintiff in a manner that would chill a person of ordinary firmness from continuing to engage in that activity," and (3) "that the Defendants' action was substantially motivated as a response to the Plaintiff's exercise of constitutionally protected conduct."
To the extent that Plaintiff's argument suggests that this Court must accept the well-pleaded factual allegations in Plaintiff's
Here, Defendants argue that investigation of an allegation that occurred before Plaintiff filed suit cannot support a plausible claim of retaliation for filing suit, and the Court agrees. Plaintiff protests that the Court should not consider Defendants' "factual denials" of its allegations, and Plaintiff's supplemental complaint does allege that Ms. Schmidt fabricated the July 26 noise complaint "starting just one month after the filing of this lawsuit." Suppl. Compl. ¶ 59. But by Plaintiff's own admission, the investigative report into the July 26 noise complaint bears "a final signature date of August 28, 2012," id. ¶ 8; see also ABRA Investigative Report at 188, Defs.' Ex. N (indicating that Investigator Jones signed and dated the report on August 27, 2012, and that Johnnie E. Jackson, Jr. signed and approved the report on August 28, 2012). Plaintiff did not file this lawsuit until February 11, 2013, Suppl. Compl. ¶ 6, and it no longer claims that the investigative report was fabricated or forged. See infra Part IV.G.2; Pl.'s Opp'n Mot. Sanctions at 8 n.2, ECF No. 22 (describing as "bizarre" that suggestion that Plaintiff alleged that the investigate report was forged). Additionally, Plaintiff has not alleged facts indicating that Ms. Schmidt was aware of this lawsuit when she notified Plaintiff of the alleged noise violation, or that she had any reason to harbor retaliatory animus against Plaintiff for filing a lawsuit to which she was not a party. Cf. Lacey v. Yates Cnty., 30 F.Supp.3d 213, 229 (W.D.N.Y.2014) (holding that plaintiff "failed to allege any facts tending to support his conclusory allegation that [the defendant] assisted in the fabrication of grand jury testimony against Plaintiff or that [the defendant] sought to retaliate against Plaintiff" for making a complaint where the plaintiff did not even allege that the defendant was told that the plaintiff had made a complaint).
Based on the facts alleged by Plaintiff, the claim that Ms. Schmidt retaliated against Plaintiff for filing a lawsuit in 2013 by fabricating a noise complaint that was investigated in 2012 is, at best, implausible. See Iqbal, 556 U.S. at 679, 129 S.Ct. 1937 ("[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged—but it has not `show[n]'—`that the pleader is entitled to relief.'" (quoting Fed. R. Civ. P. 8(a)(2)); see also Trudeau v. Fed. Trade Comm'n, 384 F.Supp.2d 281, 295 (D.D.C.2005) ("The bad faith of government actors is notoriously easy to allege and difficult to disprove, and [plaintiff] cannot avail himself of the discovery process in the hopes of stumbling upon such evidence where he can point to no indication that it exists to begin with. [Plaintiff's] First Amendment claim therefore must be dismissed for failure
Plaintiff's next claim is brought against seven Board members, Ms. Miller, Mr. Alberti, Mr. Brooks, Mr. Jones, Mr. Silverstein, Mr. Rodriguez, and Mr. Short, in both their individual and official capacities. The claim is based on a June 6, 2014, Board order that summarily suspended Plaintiff's liquor license following an assault that occurred in Plaintiff's establishment on May 24, 2014. See Suppl. Compl. ¶¶ 48, 65; Board Order 2014-247 at 86, Defs.' Ex. K, ECF No. 19-2. The Board found that the continued operation of Plaintiff's establishment posed an imminent danger to the public, based on: (1) the establishment's failure to follow its security plan, (2) its "failure to protect the crime scene" after a violent incident occurred within the establishment, (3) a finding that the establishment did "not have sufficient procedures to manage [its] crowd," and (4) a finding that the establishment had endangered a victim with a head wound by carrying the injured patron down the stairs to the front door. Board Order 2014-247 at 81-85, Defs.' Ex. K. Plaintiff disagrees with a number of the Board's findings, alleging that the Board's indefinite closure of its establishment was predicated on information that the Board members knew to be false, and that it was intended to retaliate against Plaintiff for filing this lawsuit in violation of Plaintiff's First Amendment rights. Suppl. Compl. ¶¶ 38-57, 64-71.
Defendants argue that Plaintiff's retaliation claim against the Board members is futile due to a combination of quasi-judicial immunity and Younger abstention. Defs.' Opp'n Mot. Suppl. at 11-12. Defendants first argue that the Board members are quasi-judicial actors entitled to absolute immunity for their adjudicatory decisions following show cause hearings. See D.C. Code § 25-204.01(c)(2)(E) (recognizing that the Board may exercise "quasi-judicial functions" when "deliberating or making a decision in an adjudication action or proceeding"); see also Butz, 438 U.S. at 511-13, 98 S.Ct. 2894 (holding that administrative hearing officers were entitled to judicial immunity); Wagshal v. Foster, 28 F.3d 1249, 1252 (D.C.Cir.1994) (recognizing as quasi-judicial an official whose functions are comparable to those of judge, involved in controversies intense enough to make harassment by litigants realistic, where the system contains adequate safeguards to dispense with private damages suits); see also 42 U.S.C. § 1983 (stating that "injunctive relief shall not be granted" in any action brought under § 1983 against "a judicial officer for an act or omission taken in such officer's judicial capacity," "unless a declaratory decree was violated or declaratory relief was unavailable"). Defendants cite this action as evidence that show cause hearings before the Board are likely to give rise to civil suits by dissatisfied litigants, and they note the availability of direct review of Board decisions by the District's Court of Appeals pursuant to D.C. Code § 2-2510. Accordingly, Defendants maintain that Board members cannot be held liable in their individual capacities for issuing a decision following an adversarial show cause hearing regarding alleged violations of the conditions of a liquor license.
Once again, Plaintiff has failed to offer any response to Defendants' immunity argument. In the absence of any opposition from Plaintiff, the Court deems the matter
Plaintiff has also failed to respond to Defendants' argument that Younger abstention is appropriate as to this claim because quasi-judicial state agency proceedings pertaining to the June 2014 Board order were ongoing at the time that Plaintiff filed this supplemental claim. Defs.' Opp'n Mot. Suppl. at 11-12 (citing Ohio Civil Rights Comm'n v. Dayton Christian Schs., Inc., 477 U.S. 619 (1986)); see Board Order 2014-247 at 86, Defs.' Ex. K (summarily suspending Plaintiff's license "until the Board issues its final order in a future show cause proceeding related to the incident on May 24, 2014").
In Ohio Civil Rights Commission, the Supreme Court extended the Younger abstention doctrine—a doctrine rooted in principles of equity, comity, and federalism that prevents federal courts from exercising jurisdiction over ongoing state court proceedings—to state administrative proceedings. 477 U.S. at 627-29, 106 S.Ct. 2718 (listing "administrative proceedings looking toward the revocation of a license to practice medicine" as the type of proceeding in which important state interests may be vindicated). The Court explained that even if a state administrative proceeding did not allow a plaintiff to raise his constitutional claims directly before the agency, Younger abstention was still necessary so long as the plaintiff could obtain review of his constitutional claims "in state-court judicial review of the administrative proceedings." Id. at 629, 106 S.Ct. 2718; see also Delaney v. District of Columbia, 659 F.Supp.2d 185, 194 (D.D.C. 2009) ("Younger precludes federal adjudication when three criteria are met: (1) there are ongoing state proceedings that are judicial in nature; (2) the state proceedings implicate important state interests; and (3) the proceedings afford an adequate opportunity to raise the federal claims.").
Plaintiff has failed to offer any response to or refutation of Defendants' argument that Younger abstention is required under Ohio Civil Rights Commission. Plaintiff does not dispute that state administrative proceedings were ongoing at the time it filed this claim, that the proceedings implicate important state interests, or that Plaintiff will be afforded an adequate opportunity to raise its constitutional claim before the D.C. Court of Appeals. In the absence of any opposition from Plaintiff, the Court deems conceded the argument that Younger abstention is appropriate as it pertains to Plaintiff's claim regarding the June 2014 Board order. See Cannon, 952 F.Supp.2d at 11; Romeo, No. 11-CV-6340, 2013 WL 1209098, at *12; see also Hopkins, 284 F.Supp.2d at 25.
In light of Defendants' unopposed assertions of judicial immunity and Younger abstention, the Court agrees that granting Plaintiff leave to supplement its complaint with a First Amendment retaliation claim premised on the Board's June 2014 order would be futile.
Plaintiff's final First Amendment retaliation claim is based on the May 14, 2014, order approved by six Board members—Ms. Miller, Mr. Brooks, Mr. Jones, Mr. Silverstein, Mr. Rodriguez, and Mr. Short—that required Plaintiff to cease and
Defendants contend that Plaintiff has failed to allege facts stating a plausible First Amendment retaliation claim and that, in any case, the Board members are entitled to quasi-judicial immunity for issuing the May 2014 order. Although Plaintiff asserts that it was not aware of the April 21 hearing schedule, it does not dispute either its failure to appear or its failure to apply for reinstatement of its application within ten days. See Suppl. Compl. ¶¶ 32-35. Instead, Plaintiff asserts that it filed another renewal application with ABRA on April 28, 2014, of which the Board "knew or should have known by reasonable inquiry," because the pendency of Plaintiff's renewal application was "readily evident." See Suppl. Compl. ¶¶ 35, 37, 74. Plaintiff maintains that the Board's decision to cancel Plaintiff's license for failure to apply for reinstatement was retaliatory when the Board knew or should have known of Plaintiff's April 2014 application.
There can be no question that as of May 2014, at least the four Board members who were named as Defendants in this suit were aware that Plaintiff had filed a civil complaint against them in February 2013. But it is not at all clear, Defendants argue, that the Board members were aware of Plaintiff's April 2014 renewal application that it had filed two weeks prior with a separate entity: ABRA. Defs.' Opp'n Mot. Suppl. at 13-14. Plaintiff alleges that its application was "readily evident" and that the Board "knew or should have known by reasonable inquiry" about the application, but Defendants argue that actual knowledge of the application was required in order for the Board's decision to disregard the application to have been retaliatory.
Although Plaintiff does not describe why the pendency of its renewal application should have been "readily evident," Plaintiff does assert that it filed its application with an entity overseen by the Board, and that it did so more than two weeks prior to the Board's announcement of its May 14, 2014 order. See Suppl. Compl. ¶¶ 35-36; see also Pl.'s Reply at 4 (arguing that Plaintiff adequately alleged the elements of a First Amendment retaliation claim). Additionally, Plaintiff's allegation that the Board should have known of the renewal application is accompanied by the alternative allegation that the Board members "knew" of it, that they nevertheless predicated their decision on incorrect information, and that this resulted in the closure
Defendants next argue that, as was the case with Count IX, Count X of Plaintiff's supplemental complaint is futile because it is barred by the doctrine of quasi-judicial immunity. Defendants note that Plaintiff's claim is premised on the Board members' adjudication of Plaintiff's application in their quasi-judicial roles, and that as a consequence, the Board members are absolutely immune from damages under § 1983. Defs.' Opp'n Mot. Suppl. at 14. Once more, however, Plaintiff has failed to oppose or respond to Defendants' assertion of immunity, and the Court deems the issue of quasi-judicial immunity conceded. See Cannon, 952 F.Supp.2d at 11; Romeo, No. 11-CV-6340, 2013 WL 1209098, at *12; see also Hopkins, 284 F.Supp.2d at 25. Accordingly, for the reasons stated by Defendants, the Court finds that the retaliation claim against the Board members in their individual capacities based on the May 14, 2014 order is futile.
This does not end the matter, however, because Plaintiff has brought suit against the Board members in both their individual and official capacities, and the doctrine of quasi-judicial immunity extends only to individual capacity claims. See Hafer v. Melo, 502 U.S. 21, 25, 112 S.Ct. 358, 116 L.Ed.2d 301 (1991) ("[T]he only immunities available to the defendant in an official-capacity action are those that the governmental entity possesses."); Turner v. Houma Mun. Fire & Police Civil Serv. Bd., 229 F.3d 478, 482-86 (5th Cir.2000) (holding that quasi-judicial immunity is inapplicable in official-capacity suits). Defendants do not argue, and the record does not clearly establish, that Younger abstention is appropriate as to this claim. The Court therefore must consider whether granting Plaintiff leave to supplement its complaint with this First Amendment retaliation claim against six Board members in their official capacities would be futile.
"Because the real party in interest in an official-capacity suit is the governmental entity and not the named official," Hafer, 502 U.S. at 25, 112 S.Ct. 358 (internal quotation marks omitted), Plaintiff's official capacity claim against the Board members is effectively a claim against the District of Columbia. However, municipalities are not liable under § 1983 for constitutional torts committed by their employees. Municipalities are liable "only for constitutional torts arising from `action pursuant to official municipal policy.'" Triplett v. District of Columbia, 108 F.3d 1450, 1453 (D.C.Cir.1997) (quoting Monell v. Dep't Soc. Servs. of N.Y., 436 U.S. 658, 691, 98 S.Ct. 2018, 56 L.Ed.2d 611 (1978)). And while Plaintiff's supplemental complaint does allege that the Board members were acting "under color of state authority as members of the Alcoholic Beverage Control Board for the District of Columbia Government," Suppl. Compl. ¶ 78, it does not allege that the May 2014 Board Order could be considered a product of the District's policy or custom.
Nevertheless, Plaintiff has argued that such a showing is not required because the Board members are policymakers, and municipal liability is available if a municipality's "authorized decisionmaker has intentionally deprived a plaintiff of a federally protected right." Pl.'s Opp'n Mot. Strike at 3-5 (quoting Bd. of County Comm'rs v. Brown, 520 U.S. 397, 405, 117 S.Ct. 1382, 137 L.Ed.2d 626 (1997)). Given the broad discretion that the Board has to
Plaintiff is correct that "municipal liability may be imposed for a single decision by municipal policymakers under appropriate circumstances." Singletary v. District of Columbia, 766 F.3d 66, 73-74 (D.C.Cir. 2014) (internal quotation marks and citations omitted) (holding that D.C. Board of Parole's statutory "authority to render final revocation decisions in individual cases" was "insufficient to create municipal liability unless the decisionmaker had been granted final policymaking authority under D.C. law in the area of parole revocation"). Plaintiff is also correct in noting that the Board has broad authority to make decisions on renewal applications. See, e.g., D.C. Code § 25-313 (requiring applicants to demonstrate the appropriateness of their license renewal request "to the satisfaction of the Board"). Although Plaintiff will ultimately be required to prove that the Board members had final policymaking authority under District law to prevail on its claim, at this stage of the litigation, the Court will not reject Plaintiff's official capacity claim premised on the Board's May 2014 order as futile.
Plaintiff is therefore granted leave to bring its First Amendment retaliation against the Board members in their official capacities based on the Board's May 2014 order, and the claim shall be deemed filed as of today. See Defs.' Opp'n Mot. Suppl. at 1 n.1 (requesting that if the Court grants Plaintiff's motion to supplement in full or in part, that it be deemed filed as of the date of the Court's decision to permit Defendants to file a motion to dismiss).
Counts XI and XII of Plaintiff's supplemental complaint assert that Sergeant Pope committed defamation per se and defamation per quod under District of Columbia law by making statements about Plaintiff's handling of an assault to an ABRA investigator. Suppl. Compl. ¶¶ 80-94. Count XIII alleges that all Defendants were involved in a conspiracy to deprive Plaintiff of the equal protection of the laws in violation of 42 U.S.C. § 1985. Id. ¶¶ 95-98. Defendants argue that all three claims are futile, and that leave to supplement should be denied. They contend first that Sergeant Pope, as a law enforcement officer, is entitled to absolute immunity for statements he made to an investigator in the course of his official duties while performing discretionary functions. Defs.' Opp'n Mot. Suppl. at 14-19 (citing District of Columbia v. Jones, 919 A.2d 604, 607-08 (D.C.2007); Moss v. Stockard, 580 A.2d 1011, 1020-22 (D.C. 1990)). Additionally, Defendants maintain that Plaintiff has failed to state a claim for defamation per se or defamation per quod. Id. at 19-20 (arguing that alleged statements were neither inherently defamatory nor the cause of the Board's decision and Plaintiff's harm). Defendants also argue that Plaintiff's § 1985 claim is futile because Plaintiff has not specified the basis of the claim, providing only a formulaic recitation of the cause of action devoid of any factual content and failing to state a plausible claim for relief. Id. at 20 (citing Twombly, 550 U.S. at 555, 127 S.Ct. 1955).
Although Plaintiff's reply did defend the adequacy of its allegations pertaining to its First Amendment retaliation claims, in the
The final matter before the Court is Defendants' motion for sanctions pursuant to Federal Rule of Civil Procedure 11 based on the claims and allegations contained in Plaintiff's amended and supplemental complaints. Defs.' Mot. Sanctions, ECF No. 21. As to Plaintiff's amended complaint, Defendants argue that Plaintiff lacked a good faith basis for reasserting claims that this Court has already dismissed with prejudice. Id. at 6-7. As to Plaintiff's supplemental complaint, Defendants argue that Plaintiff lacked a good faith basis for alleging that Ms. Schmidt forged an ABRA investigative report in retaliation for Plaintiff's lawsuit. Id. at 7-9. Accordingly, Defendants maintain that Plaintiff violated Rule 11's requirements that an attorney not file frivolous claims and that the attorney's representations must be based on information, and belief "formed after an inquiry reasonable under the circumstances." See Fed. R. Civ. P. 11(b). Defendants seek sanctions in the form of an order that Plaintiff withdraw those claims barred by res judicata and its claim against Ms. Schmidt, as well as an award of Defendants' costs in bringing the motion for sanctions and $5,000 in additional sanctions to deter future misconduct.
Under Federal Rule of Civil Procedure 11, the Court may impose sanctions if "a pleading, written motion, or other paper . . . [is] presented for any improper purpose[;] . . . the claims, defenses, and other legal contentions [therein] are [un]warranted by existing law[;]. . . the factual contentions have [no] evidentiary support[; or] the denials of factual contentions are [un]warranted on the evidence[.]" See Fed. R. Civ. P. 11(b), (c). The Court applies "an objective standard of reasonable inquiry on represented parties who sign papers or pleadings." Bus. Guides, Inc. v. Chromatic Commc'ns Enters., 498 U.S. 533, 554, 111 S.Ct. 922, 112 L.Ed.2d 1140 (1991). Rule 11 is designed to ensure that allegations made in a filing "are supported by a sufficient factual predicate at the time that the claims are asserted." City of Yonkers v. Otis Elevator Co., 106 F.R.D. 524, 525 (S.D.N.Y.1985). As such, it is "no answer to a motion seeking Rule 11 sanctions for asserting a baseless claim of fraud to suggest that plaintiffs needed discovery to ascertain whether the claim asserted was well founded." Id.
In response to Defendants' motion for sanctions, Plaintiff maintains that its re-assertion of previously-dismissed claims in its amended complaint was neither frivolous nor done for an improper purpose. Instead, Plaintiff argues that it had two grounds for re-stating the previously dismissed claims: (1) a concern that the claims not be construed as abandoned for the purpose of an appeal, and (2) Plaintiff's belief that res judicata does not apply to the dismissal of claims that were pending reconsideration pursuant to a motion
In reply, Defendants assert that Plaintiff is "simply wrong." Defs.' Reply at 1, ECF No. 23. Defendants first reject Plaintiff's argument that re-assertion was necessary to preserve the claims for appellate review, noting that the Elliott decision on which Plaintiff relies is entirely inapposite, and that it is well-established that a plaintiff can "obtain appellate review of the district court's dismissal of her claims . . . [after] she . . . obtain[s] a final judgment from the district court." Id. at 1-2 (quoting Blue v. D.C. Pub. Schs., 764 F.3d 11, 19 (D.C.Cir. 2014); see also Bastian v. Petren Res. Corp., 892 F.2d 680, 683 (7th Cir.1990) ("It is not waiver—it is prudence and economy—for parties not to reassert a position that the trial judge has rejected."); Owens v. Fleet Car Lease, Inc., No. 09-CV-0967-MJR, 2010 WL 2542028, at *2-4 (S.D.Ill. June 18, 2010) (imposing sanctions and rejecting plaintiff's argument that its refiling of previously dismissed claims was not in bad faith because it believed it was necessary to preserve the claims for appeal). Defendants further argue that regardless of whether res judicata applies, after this Court dismissed Plaintiff's claims as being without legal merit, Plaintiff knew that they were without legal merit, and its decision to repeat the same claims nearly verbatim in an amended complaint is sanctionable. See Serritella v. Markum, 119 F.3d 506, 512 (7th Cir.1997) (affirming imposition of Rule 11 sanctions for the repleading of claims previously rejected by the Court and deeming spurious plaintiff's counsel's argument that he believed that repleading was necessary for the purpose of appeal).
The Court agrees with Defendants that Elliott provides no support for Plaintiff's position regarding the need to repeat previously dismissed claims in order to preserve them for appellate review. In Elliott, the court rejected a plaintiff's request for reconsideration of his Privacy Act claim not because he failed to reassert it after dismissal, but because the plaintiff had previously conceded in an earlier filing "that his initial designation did not constitute a Privacy Act violation." 547 F.Supp.2d at 22-23. In the absence of any authority to support Plaintiff's belief that reassertion of its dismissed claims was necessary, the Court is sympathetic to Defendants' view that Plaintiff's decision to repeat its RICO and Takings Clause claims nearly verbatim after they were dismissed by this Court raises serious questions regarding whether Plaintiff had a good faith belief that those claims were supported by law.
Nevertheless, the imposition of Rule 11 sanctions is not something courts take lightly; instead, "Rule 11 sanctions are an extreme punishment for filing pleadings that frustrate judicial proceedings." Henok v. Chase Home Fin., LLC, 926 F.Supp.2d 100, 104 (D.D.C.2013) (internal quotation marks omitted). Plaintiff's
Additionally, because the Court is dismissing Plaintiff's RICO and Takings Clause claims for failure to seek leave to amend and, alternatively, on grounds of futility, the request that this Court dismiss the claims as a Rule 11 sanction is moot. See Hourani v. Mirtchev, 943 F.Supp.2d 159, 172 (D.D.C.2013) (choosing "not to impute bad faith on the part of the Plaintiffs, [and] finding ample grounds for dismissing the complaint on . . . substantive grounds"). The Court will therefore deny Defendants' request for Rule 11 Sanctions for Plaintiff's reassertion of previously dismissed claims. See Cobell v. Norton, 211 F.R.D. 7, 10 (D.D.C.2002) (holding that "the Court has the discretion to determine both whether a Rule 11 violation has occurred and what sanctions should be imposed if there has been a violation." (internal quotation marks omitted)).
Defendants next argue that sanctions are appropriate because Plaintiff brought baseless claims of fabricating documents against Ms. Schmidt, an attorney with the District's OAG. Defs.' Mot. Sanctions at 3-5, 7-9. Defendant contends that the allegation that Ms. Schmidt fabricated an ABRA investigative report and related documents in retaliation for Plaintiff's initiation of this suit is wholly unsupported by facts, and that sanctions are appropriate in light of Plaintiff's failure to undertake a reasonable investigation to determine the truth of its allegation prior to including it in a court filing. See Fed. R. Civ. P. 11(b) (requiring that an attorney who signs a court filing "certifies that to the best of the person's knowledge, information, and belief, formed after an inquiry reasonable under the circumstances . . . the factual contentions have evidentiary support or, if specifically so identified, will likely have evidentiary support after a reasonable opportunity for further investigation or discovery").
Emphasizing "the inherent implausibility of this claim," Defendants note that the investigative report that Ms. Schmidt allegedly fabricated bears signatures that pre-date the filing of this case, and that the ABRA investigator who authored the report testified under oath at a hearing in January 2014 that a noise complaint against Plaintiff was reported by a neighbor of Plaintiff's establishment in July 2012 as indicated in the report. Defs.' Mot. Sanctions at 8. Additionally, Defendants
In response, Plaintiff argues that the facts set forth in the supplemental complaint describe circumstances that give a "strong factual basis" for Plaintiff's claims against Ms. Schmidt. Pl.'s Opp'n Mot. Sanctions at 8. Plaintiff once again mentions the changing allegations regarding the time of day that the noise violation occurred, the seven-month delay in bringing the charge against Plaintiff, and Investigator Jones's inability to remember the complainant's name and precise address at the show cause hearing, as facts suggesting that the noise violation was fabricated. Id. at 6-8. As for the e-mail conceding that Ms. Schmidt was unaware of this lawsuit months after she charged Plaintiff with the noise violation, Plaintiff's counsel asserts that he was not yet aware that Ms. Schmidt had fabricated the noise complaint at the time he wrote the e-mail, and that discovery is needed to determine what Ms. Schmidt "knew or did not know." Id. at 9 n.3.
Plaintiff then proceeds to assert that its claim against Ms. Schmidt is premised on her fabrication of an alleged noise complaint, not fabrication of the ABRA investigative report pertaining to the complaint, and that "Plaintiff has never alleged that the investigative report itself was somehow a forgery. That allegation standing alone is rather bizarre under the circumstances and the undersigned attorney does not comprehend its origin." Id. at 8 n.2. Plaintiff's attorney's contention is nothing short of baffling, considering that Plaintiff's supplemental complaint clearly alleges that "[o]n information and belief, the August 28, 2012 Investigative Report and other documents related to the March 12, 2013 Notice were wholly fabricated by Schmidt. . . ." Suppl. Compl. ¶ 10 (emphasis added).
If the allegation was included in Plaintiff's filing inadvertently, Plaintiff could have sought to remove it after it the error was brought to its attention by Defendants' "safe harbor letter" on August 7, 2014. See Fed. R. Civ. P. 11(c)(2). But Plaintiff has not sought to remove or amend the allegation, which remains a part of Plaintiff's supplemental complaint to this day, despite the fact that Plaintiff's counsel admits that the claim "is rather bizarre." Instead, Plaintiff elected to file an incredibly serious allegation of misconduct premised on Plaintiff's "information and belief" that Plaintiff's counsel now professes not only not to believe, but not to have made in the first place. Plaintiff's attorney's disavowal of the contents of his own filing makes clear that he has not complied with his "affirmative duty to conduct a reasonable inquiry into the facts . . . before filing." Bus. Guides, Inc. v. Chromatic Commc'ns Enters., Inc., 498 U.S. 533, 551, 111 S.Ct. 922, 112 L.Ed.2d 1140 (1991); see also Clinton v. Jones, 520 U.S. 681, 709 n. 42, 117 S.Ct. 1636, 137 L.Ed.2d 945 (1997) ("Sanctions may be appropriate where a claim is presented for any improper purpose, such as to harass, including any claim based on allegations and other factual contentions lacking evidentiary support or unlikely to prove well-grounded
The Court is deeply troubled by Plaintiff's counsel's apparent disregard for the factual content of the pleadings he files before this Court. Particularly given the gravity of the allegation that Ms. Schmidt fabricated an investigative report and other documents, the Court is wholly unimpressed by counsel's effort to defend its factual allegation by simply denying the allegation's existence. Worse yet, Plaintiff's counsel's response to the Defendants' safe harbor letter—a mechanism designed to allow parties to address situations like this without the need for the imposition of sanctions—was cavalier and dismissive. See Defs.' Mot. Sanctions at 2 n.1 (explaining that Plaintiff's counsel responded to Defendants' safe harbor letter in less than thirty minutes, stating "[g]ood luck with that"). And this is not the first time that Plaintiff's counsel has made a baseless allegation that an attorney fabricated documents. See Cannon v. District of Columbia, 873 F.Supp.2d 272, 286 n. 12 (D.D.C. 2012) (noting that "Plaintiffs' unfounded allegations that defendant's attorneys fabricated evidence . . . have already been rejected by the Court" (internal citations omitted)), aff'd in part, rev'd in part on other grounds, 717 F.3d 200 (D.C.Cir. 2013); see also Thibeault v. Square D Co., 960 F.2d 239, 246 (1st Cir.1992) (holding that a court considering sanctions may consider "events which did not occur in the case proper but occurred in other cases and are, by their nature, relevant to the pending controversy").
In sum, Plaintiff's admittedly "bizarre" and apparently baseless allegation that Ms. Schmidt fabricated an investigate report and other documents is a serious matter. The allegation itself is grave, and the decision to reject the opportunity afforded by Defendants' safe harbor letter to correct the matter and avoid sanctions, choosing instead to maintain the allegation while denying its existence, is inexplicable. Given the fact that this is not the first time that Plaintiff's attorney has made such unfounded allegations, this Court finds that Rule 11 sanctions are warranted to deter future repetition of the conduct of Plaintiff's counsel. The Court therefore awards Defendants reasonable attorney's fees and costs incurred for their motion for sanctions. Had this matter progressed further towards trial, the Court may well have considered additional monetary sanctions, but in light of the facts as they stand, the Court believes that awarding fees and costs provides adequate deterrence without imposing a sanction that is more severe than is necessary. See Hilton Hotels Corp. v. Banov, 899 F.2d 40, 46 (D.C.Cir.1990) ("[A] district court should impose the least severe sanction adequate to the purpose of Rule 11." (internal quotation marks omitted)).
For the foregoing reasons, Defendants' motion to strike the amended complaint or, in the alternative, to dismiss Plaintiff's claims, is granted, Plaintiff's motion to file a supplemental complaint is granted in part and denied in part, and Defendants' motion for sanctions is granted in part and denied in part. An order consistent with this Memorandum Opinion is separately and contemporaneously issued.
