KIMBERLY J. MUELLER, District Judge.
Plaintiffs Joseph and Yvette Hardesty operate Hardesty Sand and Gravel (HSG) at the Schneider Family Mine in Sacramento County. They allege that federal, state and county agencies, prompted by a politically influential competitor, have undertaken a number of actions designed to drive HSG out of business. The following defendants have moved to dismiss the Second Amended Complaint (SAC): Sacramento County and Robert Sherry (County defendants); Dennis O'Bryant, Gay Norris, Steve Testa, Bret Koehler, and Curt Taras of the Central Valley Flood Protection Board (State defendants); Liz Gregory (Gregory); and Cindy Storelli and Leighann Moffitt (Storelli and Moffitt). The court heard argument on the motions on October 26, 2012. George Robertson and Laura Sutton, Robertson, Johnson, Miller & Williamson, appeared for plaintiffs; Joseph Rusconi, Deputy Attorney General, appeared for defendants O'Bryant, Norris, Testa, Koehler, and Taras; Jeffrey Reusch, Deputy Attorney General, appeared for defendant Gregory, and Mark O'Dea, Longyear, O'Dea & Lavra, LLP, appeared for defendants Sacramento County, Sherry, Storelli and Moffitt. The court heard argument on these motions on October 26, 2012. After considering the parties' arguments, the court GRANTS defendant Koehler's motion to dismiss but DENIES the other motions.
Defendants Sacramento Metropolitan Air Quality Management District and David Grose (SMAQMD defendants) also filed a motion to dismiss, which was heard on January 18, 2013. Kimon Manolius, Hanson Bridgett LLP, and Katherine Pittard, District Counsel, appeared for defendants; Jonathan Tew, Robertson, Johnson, Miller & Williamson, appeared for plaintiffs. After considering the parties' arguments, the court GRANTS the SMAQMD defendants' motion to dismiss.
On September 8, 2010, plaintiffs filed their original complaint, containing seven claims: (1) a violation of the Clean Air Act (CAA) against the SMAQMD defendants, Sacramento County, and James Goldstene; (2) a civil rights claim, alleging violations of the Fourteenth Amendment and Supremacy Clause against the SMAQMD defendants, Sacramento County and James Goldstene; (3) a civil rights claim alleging violations of the Fifth and Fourteenth Amendments against the Office of Mine Reclamation (OMR), Norris and O'Bryant; (4) a civil rights claim alleging due process violations against the California State Mining and Geology Board (SMGB) and Testa; (5) a Bivens claim alleging violations of the Fourth and Fifth Amendments against
While the defendants' motions to dismiss the complaint were pending, plaintiffs filed a motion seeking permission to file an amended complaint. The proposed amended complaint dropped as defendants the State of California, DFG, SMGB, OMR and Goldstene. It sought to add as defendants Cindy Storelli, in her official and individual capacity as a senior planner for Sacramento County; Leighann Moffitt in her official and individual capacity as Interim Planning Manager for Sacramento County; Bret Koehler in his official and individual capacity as Senior Engineering Geologist of the OMR; Michael Jewell; and Curt Taras in his individual and official capacity as Chief of the Encroachment Control and Land Use Section of the Central Valley Flood Protection Board. This complaint also contained seven claims: (1) a civil rights claim, alleging violations of the Due Process, Equal Protection and Supremacy Clauses against the SMAQMD defendants; (2) a civil rights claim, alleging a due process violation against defendants Koehler, Norris, Testa and O'Bryant; (3) a Bivens claim based on a due process violation against defendants Jewell and Simmons and on the Fourth Amendment against Simmons; (4) a civil rights claim, based on the Fourth Amendment, against defendant Gregory; (5) a civil rights claim, alleging a due process violation against defendant Taras; (6) a civil rights claim, based on due process and equal protection violations against Sacramento County and defendant Sherry; and (7) a civil rights claim, alleging a due process and equal protection violation against the County and defendants Storelli and Moffitt. (ECF No. 42-1(FAC).) The court considered this complaint in ruling on the earlier motions to dismiss to the extent that it contained claims substantially similar to the original complaint, as the First Amended Complaint provided some guidance on whether amendment was appropriate. (Order, ECF No. 69 at 5.) Because the First Amended Complaint omitted plaintiffs' claims under the CAA, the court deemed them waived and granted the motion to dismiss as to those claims. In addition, it granted the SMAQD defendants' motion to stay and granted the other defendants' motions in part and denied them in part. (Id. at 37-38.)
Plaintiffs have now filed their Second Amended Complaint, which contains nine claims: (1) a civil rights claim alleging Fourteenth Amendment due process and "class of one" equal protection violations, as well as Supremacy Clause violations against the SMAQMD defendants; (2) a civil rights claim alleging a Fourteenth Amendment "class of one" equal protection claim against the State defendants (3) a Bivens action alleging a Fourth Amendment violation against Zachary Simmons
Several of the state defendants argue that any claims for damages brought against them in their official capacities are barred by the Eleventh Amendment. (See ECF No. 89 at 18.) Plaintiffs respond that they are proceeding on damages claims against these defendants in their individual capacities only and confirmed this at argument. (See, e.g., ECF 107 at 11.) These portions of the motions to dismiss are denied as moot.
Defendants Taras and Koehler also argued in their brief that California's anti-SLAPP procedure, CAL.CODE CIV. PROC. § 425.16, applied to the claims against them, but at hearing withdrew this argument.
Finally, at argument counsel for defendants O'Bryant, Norris, Testa, Sherry, Storelli and Moffitt argued that their clients are entitled to qualified immunity. The court declines to consider this argument, raised for the first time at hearing. Amini v. Bank of America Corp., No. C11-0974 RSL, 2012 WL 398636, at *7 (W.D.Wash. Feb. 7, 2012) ("Arguments raised for the first time at oral argument are generally not considered because the opposing party is deprived of its opportunity to evaluate the merits of the new argument before responding.").
Under Rule 12(b)(6) of the Federal Rules of Civil Procedure, a party may move to dismiss a complaint for "failure to state a claim upon which relief can be granted." A court may dismiss "based on the lack of cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory." Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir.1990).
Although a complaint need contain only "a short and plain statement of the claim showing that the pleader is entitled to relief," FED. R. CIV. P. 8(a)(2), in order to survive a motion to dismiss this short and plain statement "must contain sufficient factual matter ... 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 Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007)). A complaint must include something more than "an unadorned, the-defendant-unlawfully-harmed-me accusation" or "`labels and conclusions' or `a formulaic recitation of the elements of a cause of action.'" Id. (quoting Twombly, 550 U.S. at 555, 127 S.Ct. 1955). Determining whether a complaint will survive a motion to dismiss for failure to state a claim is a "context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 679, 129 S.Ct. 1937. Ultimately, the inquiry focuses on the interplay between the factual allegations of the complaint and the dispositive issues of law in the action. See Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 81 L.Ed.2d 59 (1984).
In making this context-specific evaluation, this court must construe the complaint in the light most favorable to the plaintiff and accept as true the factual allegations of the complaint. Erickson v. Pardus, 551 U.S. 89, 93-94, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007). This rule does not apply to "`a legal conclusion couched as a factual allegation,'" Papasan v. Allain, 478 U.S. 265, 286, 106 S.Ct. 2932, 92 L.Ed.2d 209 (1986) (quoted in Twombly, 550 U.S. at 555, 127 S.Ct. 1955), nor to "allegations that contradict matters properly subject to judicial notice" or to material
Plaintiffs own HSG, a sand and gravel operation, which has leased the Schneider Family Mine since the early 1980s and is authorized by contract to mine and process aggregate material. (ECF No. 74 ¶¶ 28, 31.) In 1994, Sacramento County confirmed Schneider's vested right to mine without the future need for surface mining and/or conditional use permits under California's Surface Mining and Reclamation Act (SMARA). (ECF No. 74 ¶¶ 29-30.) In 2002, Sacramento County approved HSG's reclamation plan and in 2008 county representatives inspected the mine, concluding that HSG was operating in accordance with SMARA requirements and the reclamation plan. (ECF No. 74 ¶ 31.)
Plaintiffs allege that in March 2007, employees of Teichert Company (Teichert), one of HSG's competitors, began to contact state and federal agencies, complaining that HSG was undercutting Teichert's sales by offering "very cheaply priced product" and asking the agencies to coordinate efforts to regulate HSG, which would drive up its prices. (ECF No. 74 ¶ 33 & Ex. F.) Teichert also sought the assistance of state Senator Dave Cox and Congressman Dan Lungren. (ECF No. 74 ¶ 34.)
In early 2008, defendant Simmons of ACE began to organize a coordinated investigation of HSG. (ECF No. 74 ¶ 35.
In September 2008, Simmons contacted Liz Gregory at DFG to discuss an inspection of the mine. Thereafter Simmons and Gregory entered the mine, without a warrant, and inspected a dam on the southernmost creek, the processing facility, and the creek along the northeast side of the processing facility. (ECF No. 74 ¶ 41.)
In October 2008, Senator Cox sent a letter to the Secretary of the California Resources Agency (CRA), asking CRA to coordinate a review of HSG's operation by the Department of Conservation (DOC), the SMGB and the DFG; he asked specifically whether HSG could be excluded from the list of aggregate vendors approved to sell to state agencies, the so-called AB 3098
In November 2008, CRA's secretary reported to Senator Cox that the CRA had initiated a coordinated review of HSG. (ECF No. 74 ¶ 46.)
Kris Vyverberg, a Senior Geologist from DFG, began to work with Koehler, Norris and O'Bryant, all employees of OMR, to
Although officials from DFG had found no violations at HSG, Koehler, O'Bryant and Norris continued to investigate HSG. (ECF No. 74 ¶ 50.) These three defendants visited HSG on December 23, 2008 and in February 2009 Koehler completed an inspection report that identified alleged violations of SMARA and other statutory requirements. (ECF No. 74 ¶ 55.)
In February 2009, OMR put HSG on the AB 3098 list, but O'Bryant removed it six weeks later on the basis of Koehler's report. (ECF No. 74 ¶¶ 45, 56.) Defendants did not remove other similarly situated mining operators from the AB 3098 list despite those operators' violations, similar to those attributed to HSG. (ECF No. 74 ¶ 59.) In response to an inquiry from HSG's counsel, Testa and O'Bryant told plaintiffs there was no mechanism for appealing their removal from the list. (ECF No. 74 ¶¶ 62-63.)
Nevertheless, in February, Simmons reported to Congressman Lungren's office that HSG's operations did not impact as many navigable waters as did operations by the companies that had complained about HSG. (ECF No. 74 ¶ 47 & Ex. I.
In April 2009, SMAQMD, acting as part of the competitors' campaign, issued a petition alleging that HSG was operating equipment in violation of SMAQMD Rule 201, even though SMAQMD does not have the authority to regulate the equipment it targeted in light of state and federal regulations. In addition, SMAQMD relied on an improper underground regulation. (ECF No. 74 ¶¶ 67-75.) At the abatement hearing held on this notice, Grose presented SMAQMD's positions despite their conflict with state and federal law and with the testimony of the CARB representative. (ECF No. 74 ¶ 73.) The CARB representative also explained that nonroad engines travelling only 25 to 30 feet are not considered to be at a single site if there is a legitimate purpose for the movement. (ECF No. 74 ¶ 74.) After the hearing, SMAQMD ordered plaintiffs to cease and desist operations pending compliance with Rule 201. (ECF No. 74 ¶¶ 76-77).
In May 2009, defendant Taras inspected a portion of the mine along the Cosumnes River on behalf of the Central Valley Flood Protection Board (CVFPB) and later issued an order directing HSG to cease and desist all work regulated by the California Water Code. (ECF No. 74 ¶¶ 85-86.)
While plaintiffs were challenging the SMAQMD decision by pursuing a writ of mandate in the Superior Court, SMAQMD asked the California Air Resources Board (CARB) to declare HSG's registered portable equipment to be considered stationary when used at the mine. (ECF No. 74 ¶ 78.) In February 2010, Goldstene determined that some of plaintiffs' equipment was not eligible for PERP registration. (ECF No. 74 ¶ 78.) On appeal, a hearing officer upheld most of Goldstene's determinations, as did the Superior Court. (ECF
In 2010, Congressman Lungren's office contacted Teichert, ACE, DFG and the U.S. Fish and Wildlife Service (FWS) about resuming the investigation of HSG. (ECF No. 74 ¶ 87 & Ex. K.) As a result, defendant Jewell of the ACE sent another cease and desist letter to HSG. (ECF No. 74 ¶¶ 88-89.)
Around the same time, defendant Sherry sent a notice to Schneider, the owner of the mine, informing him that the mining operation had expanded in violation of zoning requirements. (ECF No. 74 ¶ 91.) Schneider appealed, citing his vested right to mine. (ECF No. 74 ¶ 92.) The Board of Supervisors rejected Schneider's appeal. (ECF No. 74 ¶ 95.) Thereafter, OMR notified Sacramento County that it must take action to correct violations at the mine; Schneider's appeal of this notice was denied in May 2011. (ECF No. 74 ¶¶ 96-97.) Plaintiffs were not given notice of any of these proceedings. (ECF No. 74 ¶¶ 92, 96.)
After the Superior Court upheld SMAQMD's abatement order, plaintiffs applied for a permit. Defendant Grose initially denied the permit, but then rescinded the denial. He did not rescind the cease and desist order, which informed plaintiffs that any type of operation at their facility would violate regulations and the abatement order. (ECF No. 74 ¶¶ 82-83.)
On November 17, 2010, Sacramento County approved plaintiffs' Financial Assurance Cost Estimate (FACE) in the amount of $164,223, but in December 2010, Storelli told plaintiffs their FACE should be increased to $830,490. (ECF No. 74 ¶ 101.) In addition, in January 2011, Moffitt sent plaintiffs a letter demanding a valid Financial Assurance Mechanism (FAM) in the amount of $830,490 and directed them to cease operations until the FAM was in place. (ECF No. 74 ¶¶ 99, 102.) Plaintiffs' competitors have been allowed to continue operations even though their FAMs were below required amounts. (ECF No. 74 ¶ 106.)
Defendants O'Bryant, Norris, Testa, Koehler and Taras move to dismiss under Rule 12(b)(6) and to strike under California's Anti-SLAPP provisions, arguing that the statute of limitations bars the civil rights actions against Taras and Koehler; that the court's prior order rejected plaintiffs' allegations against Norris based on her telling contractors not to purchase plaintiffs' aggregate; that the "class of one" equal protection and substantive due process claims are not adequately pleaded; and that the allegations against Taras and Koehler should be stricken because this is a strategic lawsuit against public participation in violation of California Code of Civil Procedure § 425.16. They ask the court to take judicial notice of a number of documents and also have submitted declarations from Taras and Koehler. (ECF Nos. 90-92.) Plaintiffs object to the court's consideration of this evidence and oppose the request for judicial notice.
The state defendants ask the court to take judicial notice of the following: the court's prior order ruling on the first round of motions to dismiss; Taras's May 28, 2009 letter to plaintiffs; a mine inspection report dated February 23, 2009; portions of the California Code of Regulations; the absence of records regarding a
The court need not take judicial notice of its prior order in this case. It does take judicial notice of the administrative regulations offered by the state defendants. DCIPA, LLC v. Lucile Slater Packard Children's Hosp., 868 F.Supp.2d 1042, 1048 (D.Or.2011) (taking judicial notice of administrative rules). It also takes notice of the existence of Koehler's mine inspection report and Taras's letter, mentioned in the Second Amended Complaint, but not the truth of the findings in those documents. Branch v. Tunnell, 14 F.3d 449, 454 (9th Cir.1994) (stating that on a motion to dismiss district court may consider documents the contents of which are mentioned in the complaint when the authenticity is not questioned); Coalition for a Sustainable Delta v. Fed. Emergency Mgmt. Agency, 812 F.Supp.2d 1089, 1093 (E.D.Cal.2011). It does not take judicial notice of the absence of records regarding the Horseshoe Mine or any of the other facts contained in the two declarations. See Stamas v. County of Madera, 795 F.Supp.2d 1047, 1060 (E.D.Cal.2011) (taking judicial notice that declarations were filed in other litigation but declining to take judicial notice of the factual averments in the declarations).
A party may raise a statute of limitations argument in a motion to dismiss if it is apparent from the face of the complaint that the complaint was not timely filed and that plaintiff will be unable to prove facts that will establish the timeliness of the claim. Von Saher v. Norton Simon Museum, 592 F.3d 954, 969 (9th Cir.2010), cert. denied, ___ U.S. ___, 131 S.Ct. 3055, 180 L.Ed.2d 885 (2011); Supermail Cargo, Inc. v. United States, 68 F.3d 1204, 1206 (9th Cir.1995). Civil rights actions brought under section 1983 are governed by the statute of limitations for personal injury actions of the forum state. Wilson v. Garcia, 471 U.S. 261, 279-80, 105 S.Ct. 1938, 85 L.Ed.2d 254 (1985); Jones v. Blanas, 393 F.3d 918, 927 (9th Cir.2004). California law provides for a two year statute of limitations for personal injury, applicable to civil rights claims brought under section 1983. CAL.CIV.PROC. CODE § 335.1.
According to the Second Amended Complaint, Koehler inspected the mine in December 2008 and dated his report of that inspection on February 27, 2009, while Taras inspected the mine on May 14, 2009 and sent plaintiffs a cease and desist letter on May 28, 2009. (ECF No. 74 ¶¶ 53, 55, 85-86; ECF No. 91 ¶¶ 4, 6; ECF No. 92 4-5.) The Second Amended Complaint was filed on May 10, 2012, long after the statute of limitations had expired, whether the court considers the date of the inspection or the report as the beginning of the limitations period.
Plaintiffs argue that the claims against Taras were included in the proposed First Amended Complaint, which was filed on May 11, 2011, and that therefore they are timely. In Mayes v. AT & T
Plaintiffs' claims against Koehler are pleaded only in the Second Amended Complaint and so are not timely unless they relate back to the original complaint. The Federal Rules of Civil Procedure provide:
FED. R. CIV. P. 15(c).
Defendants argue that California's relation-back rules govern and under those rules, the claim against Koehler does not relate back to the original complaint. Plaintiff relies on the federal rules regarding relation back as recently explained by the U.S. Supreme Court in Krupski v. Costa Crociere S.p.A., 560 U.S. 538, 130 S.Ct. 2485, 177 L.Ed.2d 48 (2010), to argue that the claim is timely. Neither the California nor the federal rules regarding relation back render the claim against Koehler timely.
Defendant is correct that in Anderson v. Allstate Ins. Co., 630 F.2d 677 (9th Cir.1980), the Ninth Circuit looked to California's process for substituting fictitious (Doe) defendants under state Code of Procedure § 474 in determining whether the addition of a defendant was timely. See also Kubal v. Discount Tire.com, No. 12-CV-1398 IEG (BGS), 2012 WL 3648607, at *1 (S.D.Cal. Aug. 23, 2012). Under that provision, the substitution of a named party for a Doe defendant is deemed to relate back to the original complaint so long as the plaintiff was "genuinely ignorant" of the newly added defendant's identity. Woo v. Superior Court, 75 Cal.App.4th 169, 177, 89 Cal.Rptr.2d 20 (1999). Plaintiffs' allegations in the Second Amended Complaint, that Koehler inspected the mine in 2008 and wrote a report of that inspection in 2009, show they were aware of him at the time they filed the original complaint, which refers to both the inspection and the report. (ECF No. 2 ¶¶ 36-37.)
Anderson was decided under a prior version of Federal Rule of Civil Procedure 15, a version that did not include the current provision permitting reliance on
In Costa Crociere, the Supreme Court considered the relation back provisions of Federal Rule 15(c): "The question under Rule 15(c)(1)(C)(ii) is not whether Krupski knew or should have known that it would have been named as a defendant but for an error. Rule 15(c)(1)(C)(ii) asks what the prospective defendant knew or should have known during the Rule 4(m) period, not what the plaintiff knew or should have known at the time of filing her original complaint." Krupski v. Costa Crociere, 130 S.Ct. at 2493. The Court continued that "[r]epose would be a windfall for a prospective defendant who understood, or who should have understood, that he escaped suit during the limitations period only because the plaintiff misunderstood a crucial fact about his identity." Id. at 2494.
The Seventh Circuit has distilled Costa Crociere's requirements as follows:
Joseph v. Elan Motorsports Techs. Racing Corp., 638 F.3d 555, 559-60 (7th Cir.2011). Other post-Costa Crociere cases recognize that a plaintiff's deliberate choice not to sue a party involved in the events at issue in the complaint is not a mistake. Briese v. State of Montana, No. CV-09-146 BLG-RFC-CSO, 2010 WL 5677921, at *10 (D.Mont. July 16, 2010), recommendation adopted by 2011 WL 338399 (D.Mont. Jan. 31, 2011); Asten v. City of Boulder, Civil Action No. 08-cv-00845 PAB MEH, 2010 WL 5464298, at *6 (D.Colo. Sep. 28, 2010), recommendation adopted by 2010 WL 5464297 (D.Colo. Dec. 29, 2010). In this case, the first amended complaint identifies the December 2008 inspection and the February 2009 report, listing the report's many errors. (ECF No. 2 ¶¶ 36-38.) Had Koehler been aware of the complaint within the time for service, he would have believed that plaintiffs made a conscious choice not to sue him, not that their mistake caused his omission from the complaint. The Second Amended Complaint as to Koehler is not timely.
In the order resolving the earlier motions to dismiss, this court found that Norris's alleged acts in threatening truck drivers with adverse action if they bought aggregate from HSG did not state a substantive due process claim and dismissed without leave to amend. Norris argues that plaintiffs have improperly included
Plaintiffs argue they have included these allegations only to illustrate Norris's part in the "coordinated ... attacks" in the attempt to drive plaintiffs out of business. (ECF No. 74 ¶ 199.) The allegations concerning the AB 3098 list are not pleaded as a free-standing due process claim, but as part of the overall substantive due process claim, based on the allegations that defendants worked together to drive plaintiffs out of business. (ECF No. 74 ¶¶ 192-203.)
Defendants reply more broadly that plaintiffs have not pleaded a substantive due process violation because they do not have a protected property interest in unregulated surface mining or in practicing the mining profession.
The Due Process Clause of the Fourteenth Amendment forbids the state from depriving a person of property without due process of law. Carver v. Lehman, 558 F.3d 869, 872 (9th Cir.2009). There are two steps in the analysis of a due process claim: the court must determine whether plaintiffs have a protected property interest and, if so, whether they received all the process due to them. Walls v. Central Contra Costa Transit Authority, 653 F.3d 963, 967-68 (9th Cir.2011). Property interests are created by state law, but not every state statutory right thereby becomes a constitutional entitlement. Paul v. Davis, 424 U.S. 693, 700, 96 S.Ct. 1155, 47 L.Ed.2d 405 (1976); Board of Regents v. Roth, 408 U.S. 564, 577, 92 S.Ct. 2701, 33 L.Ed.2d 548 (1972); Vruno v. Schwarzwalder, 600 F.2d 124, 131 (8th Cir.1979) ("The due process clause does not convert every state statutory right into a constitutional entitlement...."). Instead, "federal constitutional law determines whether that interest rises to the level of a `legitimate claim of entitlement' protected by the Due Process Clause." San Bernardino Physicians' Services Med. Grp. v. County of San Bernardino, 825 F.2d 1404, 1408-09 (9th Cir.1987) (quoting Memphis Light, Gas & Water Div. v. Craft, 436 U.S. 1, 9, 98 S.Ct. 1554, 56 L.Ed.2d 30 (1978) (quoting Roth, 408 U.S. at 577, 92 S.Ct. 2701)).
Plaintiffs allege they are operating under a vested right to mine and also assert their liberty interest in pursuing their profession. Defendants do not seriously dispute the argument that a vested right to mine would be an adequate property interest, but they argue that plaintiffs' failure to comply with SMARA undercuts any claim because plaintiffs "have no recognized constitutional right to mine free from regulation." (ECF No. 89 at 26.
Under SMARA, every surface mining operation must have a permit or have a vested right to conduct surface mining, a reclamation plan, and financial assurances to implement the reclamation. CAL. PUB. RES. CODE § 2710 et seq.; Calvert v. County of Yuba, 145 Cal.App.4th 613, 617, 51 Cal.Rptr.3d 797 (2006). Defendants argue that plaintiffs do not have any rights under SMARA because they have neither approved financial assurances
Defendants challenge the adequacy of plaintiffs' class of one challenge. In Village of Willowbrook v. Olech, 528 U.S. 562, 564, 120 S.Ct. 1073, 145 L.Ed.2d 1060 (2000), the Supreme Court recognized as viable "equal protection claims brought by a `class of one,' where the plaintiff alleges that she had intentionally been treated differently from others similarly situated and that there is no rational basis for the difference in treatment." To make a "class of one" equal protection claim plaintiff must meet three elements: the defendants "(1) intentionally (2) treated [plaintiffs] differently than other similarly situated [mine operators], (3) without a rational basis." Gerhart v. Lake County, Mont., 637 F.3d 1013, 1022 (9th Cir.), cert. denied, ___ U.S. ___, 132 S.Ct. 249, 181 L.Ed.2d 143 (2011). "[A]s to the different treatment element, a plaintiff must demonstrate that the `level of similarity between plaintiff and the persons with whom they compare themselves [is] extremely high.'" Hamer v. El Dorado County, No. CIV S-08-2669 KJM EFB PS, 2011 WL 794895, at *12 (E.D.Cal. Mar. 1, 2011) (quoting Wilson v. City of Fresno, No. CV F 09-0887 LJO SMS, 2009 WL 3233879, at *7 (E.D.Cal. Oct. 2, 2009)). As to the basis of the treatment, the pleading requirement may be satisfied by "the pattern and nature of defendants' alleged conduct," which can "do the work of demonstrating the [defendants'] improper discriminatory purpose." Geinosky v. City of Chicago, 675 F.3d 743, 748 (7th Cir.2012).
The court rejects defendants argument that plaintiffs' claim is too conclusorily pleaded to survive a motion to dismiss. Plaintiffs allege that the defendants "have allowed other similarly-situated mining operators, including Lehigh Southwest Cement Company, to remain on the AB 3098 list despite mining violations virtually identical to those alleged against plaintiffs," and did not warn contractors not to purchase aggregate from other mines not on the AB 3098 list, including the Horseshoe Mine. (ECF No. 74 ¶¶ 121-123.) See Ziss Bros. Constr. Co. v. City of Independence, Case No. 1:07 CV 3767, 2008 U.S. Dist. Lexis 104606, at 17 (N.D.Ohio Sep.
Relying on Parratt v. Taylor, 451 U.S. 527, 101 S.Ct. 1908, 68 L.Ed.2d 420 (1981), defendants argue that plaintiffs cannot maintain a due process claim against Taras for issuing a cease and desist order because plaintiffs do not have a property interest in polluting and because plaintiffs failed to challenge the order in administrative proceedings. Plaintiffs counter that section 1983 does not require administrative exhaustion under these circumstances.
In Parratt, an inmate alleged he was deprived of materials he had ordered when prison officials failed to follow the normal mail procedure; the inmate brought suit to recover the value of the materials. The Court agreed that a person is entitled to an opportunity to be heard at a meaningful time, but noted that when the deprivation is the "result of a random and unauthorized act," the state is unable to predict when the loss will occur and so cannot provide a meaningful hearing before the deprivation. Id. at 541, 101 S.Ct. 1908. The Court concluded that when a plaintiff claims a deprivation of a liberty or property interest caused by an unauthorized negligent or intentional act by a state actor, the plaintiff cannot state a claim when the state provides an adequate post-deprivation remedy. Parratt, 451 U.S. at 543-44, 101 S.Ct. 1908, overruled on other grounds by Daniels v. Williams, 474 U.S. 327, 106 S.Ct. 662, 88 L.Ed.2d 662 (1986). When the plaintiff challenges conduct taken in compliance with an established procedure, rule or regulation, the existence of a post-deprivation remedy is irrelevant. Knudson v. City of Ellensburg, 832 F.2d 1142, 1149 (9th Cir.1987) ("We apply Parratt ... only when the state administrative machinery did not and could not have learned of the deprivation until after it occurred, not when state officials acted pursuant to state policy and followed state procedures they believed were proper.") (internal citation, quotation omitted). Here, plaintiffs allege that the cease and desist order is improper but not that it was a negligent or random act. Defendants have provided nothing suggesting that predeprivation process was impractical.
Taras's argument that plaintiffs do not have a right to pollute suffers from the more general nature of the attack on plaintiffs' substantive due process claim: it assumes that Taras's claims of plaintiffs' violations are true. As the court must accept plaintiffs' complaint as true, this argument is unavailing.
As with the state defendants, Storelli and Moffitt argue that plaintiffs have not adequately pleaded their "class of one" equal protection claim. They argue that
In Bell Atlantic Corp. v. Twombly, the Court considered the pleading requirements for a claim of conspiracy or combination under the Sherman Act and held that "stating such a claim requires a complaint with enough factual matter (taken as true) to suggest that an agreement was made." 550 U.S. at 556, 127 S.Ct. 1955. The complaint provides information on the agreement among SMAQMD, the Central Valley Regional Water Control Board (CVRWCB), FWS, DFG and OMR. It also includes allegations that Kris Vyverberg, a geologist with DFG, decided to use a theory that plaintiffs had substantially deviated from their existing reclamation plan so as to force HSG to file a new reclamation plan and that Vyverberg and OMR would "approach the County with the `substantial deviations' theory to induce the County, as lead agency to act." (ECF No. 74 ¶¶ 52-54 & Exs. B & J (referring to the approach to the County).) Under California Public Resources Code section 2770(a), financial assurances are tied to the reclamation plan. Accordingly, the allegations that Storelli and Moffitt acted to raise the financial requirements precipitously, close in time to other events in the alleged scheme and shortly after they had approved significantly lower FACEs for HSG, coupled with the allegations about the county-as-lead-agency's participation, is sufficient to survive the motion to dismiss.
Nor does it matter that these defendants relied on environmental inspector Dan Bieber's report to increase the required financial assurances. Plaintiffs' claim is that the defendants hired Bieber even though they had never hired an environmental inspector for other mines, and allowed plaintiffs' competitors to pay Bieber's fees for the inspection. Thus, their action in retaining Bieber was part and parcel with the other alleged arbitrary actions against plaintiffs. (ECF No. 74 ¶ 168.)
As with the State defendants' attack on the equal protection claim, these defendants' arguments are unavailing. Plaintiffs allege that their competitors were not subjected to inspections or increased FACEs and were permitted to continue operations without such inspections, and that the increased FACE for plaintiffs was irrational in that operations at HSG had not changed and so did not require an increased financial guarantee for reclamation. (ECF No. 74 ¶¶ 171-172.) This allegation adequately states an equal protection "class of one" claim.
Defendants Sherry and the County of Sacramento argue that as plaintiffs have no vested right to mine, they were not entitled to notice of the County's actions concerning the mine and that only the owner of the property, not the tenant, was entitled to notice of the zoning hearing. They also contend that under California law, the only notice necessary when someone seeks a declaration of the vested right to mine is that given to the neighbors of the proposed mine property. Finally, they argue that plaintiffs have not sufficiently tied Sherry and the County to the alleged conspiracy, and the substantive due process claim cannot stand because plaintiffs have not alleged the County defendants' motive for their actions.
As noted, plaintiffs allege they are operating under Schneider's vested interest and that because they are doing so, they were entitled to notice of the County defendants' actions that potentially interfere with that interest. See note 3 supra. Also, as noted above, defendants have presented no authority or argument that someone other than the property owner who is exercising the owner's rights does not have a protectable property interest. See Oxford Bank & Trust and Fifth Ave. Prop. Mgmt. v. Village of La Grange, 879 F.Supp.2d 954 (N.D.Ill.2012) (stating that village ordinance preventing tenant from obtaining license for pawnshop implicated landlord's protectable property interest in continued use of property, but finding no procedural due process violation).
Defendants argue that under Sacramento County Zoning Code § 115-08,
Plaintiffs allege that the County defendants refused to allow them to continue mining during the pendency of their application for a conditional use permit, yet allowed others to do so. They also allege that the County defendants claimed that when plaintiffs moved their plant, it constituted a substantial deviation from plaintiffs' reclamation plan, but these defendants allowed others, including Western Aggregates, to move their plants without finding a substantial deviation. Plaintiffs further allege that these actions were undertaken as part of a plan to drive them out of business. As noted above, these allegations are sufficient to support plaintiffs' class of one equal protection claim.
These County defendants also argue that there are no allegations that Sherry participated in any conspiratorial communications. However, as with defendants Storelli and Moffitt, the allegations of the County's involvement coupled with Sherry's actions is sufficient at this stage.
The Second Amended Complaint alleges that Gregory, a Game Warden with DFG, "entered the property and ... inspected at least a dam on the southernmost creek, the processing facility, and the wetland creek along the north east side of the processing facility." (ECF No. 74 ¶ 142.) Gregory argues that plaintiffs cannot maintain a Fourth Amendment claim because the areas she inspected were all "open fields" and that plaintiffs lack a reasonable expectation of privacy because mining is a pervasively regulated industry.
As noted above, the court takes notice of the existence of Koehler's report and Taras's letter, mentioned in the Second Amended Complaint, but not the truth of the findings in those documents. Branch v. Tunnell, 14 F.3d 449, 454 (9th Cir.1994); Coalition for a Sustainable Delta, 812 F.Supp.2d at 1093.
The Fourth Amendment protection against warrantless searches does not extend to open fields, as "no expectation of privacy legitimately attaches to open fields." Oliver v. United States, 466 U.S. 170, 180, 104 S.Ct. 1735, 80 L.Ed.2d 214 (1984). Thus, in Dow Chemical v. United States, 476 U.S. 227, 106 S.Ct. 1819, 90 L.Ed.2d 226 (1986), the Court determined that an EPA "fly over" of Dow Chemical's industrial complex was not a warrantless search because despite Dow's efforts to keep its plant private, it was akin to "open fields" and also was commercial property, which the government has greater latitude to subject to warrantless inspections. Id. at 237-38, 106 S.Ct. 1819. Relying on Oliver and Dow Chemical, courts have often approved enforcement-related searches under the open fields doctrine. See, e.g., Widgren v. Maple Grove Township, 429 F.3d 575 (6th Cir.2006); Dunham v. Kootenai County, 690 F.Supp.2d 1162 (D.Idaho 2010); Betchart v. California State Dept. of Fish and Game, 158 Cal.App.3d 1104, 205 Cal.Rptr. 135 (1984). However, as the Dow Chemical Court recognized, "Dow plainly has a reasonable, legitimate, and objective expectation of privacy within the interior of its covered buildings." Dow Chemical, 476 U.S. at 236, 106 S.Ct. 1819. The Second Amended Complaint alleges that Gregory searched the processing facility, but does not describe whether the facility consists of a building, a covered area, or a completely open area. At hearing, defendant argued that Koehler's report describes the facility as completely open and also that the facility cannot be deemed to be part of any curtilage so as to defeat a finding of open fields because there is no such thing as business curtilage. See United States v. Dunn, 480 U.S. 294, 107 S.Ct. 1134, 94 L.Ed.2d 326 (1987) (finding no Fourth Amendment violation when agents looked into barn which was not within the farm house's curtilage). The court here need not reach the question whether it can read Dunn as broadly as defendant argues; as it has declined to take judicial notice of defendant's description of plaintiffs' processing plant, it cannot determine from the face of the complaint that the open fields doctrine validates the search. See United States v. Elkins, 300 F.3d 638, 654 (6th Cir.2002) (noting that it had not decided "whether there are circumstances in which the area adjoining a business structure is protected against physical entry like the curtilage of a home" and also discussing Dunn).
Gregory also asks this court to revisit its earlier rejection of the argument that warrantless commercial searches are standard in highly regulated industries and so plaintiffs have no reasonable expectation of privacy. She again relies on Donovan v. Dewey, 452 U.S. 594, 101 S.Ct. 2534, 69
Gregory argues that because any claims against her flow only from the alleged Fourth Amendment violation, the substantive due process claim should be dismissed. See, e.g., Larson v. Neimi, 9 F.3d 1397, 1400-01 (9th Cir.1993) (stating that Fourth Amendment standards, not substantive due process standards, must be applied to claim that public official has illegally seized someone). Plaintiffs do not plead that the search by itself violates substantive due process but rather that the search is part of a larger concerted action to drive plaintiffs out of business. Plaintiffs have properly alleged a substantive due process claim; Gregory is not entitled to dismissal.
The SMAQMD defendants argue that the state proceedings are barred by res judicata in that the state Court of Appeal rejected the claims plaintiffs bring here. They also argue that a federal court remand order establishes that the permit requirement is not a federally preempted omission standard. They finally argue that the complaint fails to state a claim for a variety of reasons.
Plaintiffs counter that the action should be stayed because of on-going proceedings concerning the permit and that the two prior decisions do not preclude the due process and equal protection claims raised in the instant action.
In its order filed March 29, 2012, 2012 WL 1131387, the court agreed with the SMAQMD defendants that the action as to them should be stayed after the Second Amended Complaint was filed, in light of Younger v. Harris, 401 U.S. 37, 91 S.Ct. 746, 27 L.Ed.2d 669 (1971), because of the pendency of state court proceedings. (ECF No. 69 at 10-11.)
Plaintiffs filed the Second Amended Complaint against all the defendants, including the SMAQMD defendants. Without seeking to lift the stay, the SMAQMD defendants filed a motion to dismiss. Plaintiffs opposed, noting that the stay was still in place. In reply, defendants claimed the court had implicitly lifted the stay in approving a joint stipulation regarding responses to the Second Amended Complaint and arguing that plaintiffs were merely
The court lifted the stay, rescheduled the hearing on the motion to dismiss, and gave plaintiffs time to respond to the merits of the motion. (ECF No. 125.) In their opposition, plaintiffs argue that a stay is still appropriate because SMAQMD filed a complaint for civil penalties in Sacramento County Superior Court, alleging that plaintiffs are operating equipment without the appropriate permits, have violated the abatement order and have failed to file annual reports. (Opp'n to SMAQMD Mot. to Dismiss, ECF No. 130, at 7.) Plaintiffs do not identify any basis for the stay but rather argue only that the potential for overlapping litigation exists.
In its prior order, the court entered the stay only because of the parties' agreement that it was appropriate, noting that Younger abstention was not appropriate when the state proceedings are parallel to, and not interfering with, the state proceedings. (ECF No. 69 at 11-12.) See Marks v. Stinson, 19 F.3d 873, 882 (3d Cir.1994). Plaintiffs have presented only a copy of the Superior Court's tentative ruling on SMAQMD's motion to strike portions of the Hardestys' answer, yet make no attempt to show why the pending state court action justifies a continued stay of these proceedings. The court declines to undertake the analysis that was plaintiffs' to make.
SMAQMD defendants argue that the proceedings in state court following the hearing on the abatement order preclude those portions of plaintiffs' complaint that challenge SMAQMD's decisions and actions regarding plaintiffs' engines and other machinery and classification of the mine as a single site. They also argue that a remand order from the Eastern District precludes plaintiffs from arguing that the permit requirement is preempted by the Clean Air Act.
They ask the court to take judicial notice of a number of documents, including the decision of the state Court of Appeal as well as plaintiffs' briefing in that court, the administrative mandate challenging the abatement order, and their briefing during the abatement proceedings, as well as documents from another case in this court, Sacramento Metropolitan Air Quality Management Board v. Hardesty, Civ. No. 11-2278 JAM JFM (E.D.Cal.). (2/28/11 & 7/9/12 Requests for Judicial Notice (RJN), ECF 67.) A court may take judicial notice "`of proceedings in other courts, both within and without the federal judicial system, if those proceedings have a direct relation to the matters at issue.'" United States v. Black, 482 F.3d 1035, 1041 (9th Cir.2007) (quoting United States ex. rel. Robinson Rancheria Citizens Council v. Borneo, Inc., 971 F.2d 244, 248 (9th Cir.1992)). The court takes judicial notice of the proffered state records, as they have a "direct relation" to the resolution of the SMAQMD defendants' preclusion arguments. As the court finds the state proceedings to have res judicata effect, it need not consider whether an order remanding a case to the Superior Court has any preclusive effect and so need not take judicial notice of the proceedings in the Eastern District.
"Under 28 U.S.C. § 1738, a state court judgment is entitled to the same preclusive effect in federal court as it
"In California, res judicata precludes a plaintiff from litigating a claim if: the claim relates to the same `primary right' as a claim in a prior action, the prior judgment was final and on the merits, and the plaintiff was a party or in privity with a party in the prior action." Trujillo v. County of Santa Clara, 775 F.2d 1359, 1366 (9th Cir.1985); see also San Diego Police Officers' Ass'n v. San Diego City Employees' Retirement Sys., 568 F.3d 725, 734 (9th Cir.2009). These factors are analyzed below.
Plaintiffs do not dispute the identity of the parties in the two actions.
"A final judgment is on the merits for the purposes of res judicata `if the substance of the claim is tried and determined....'" Johnson v. City of Loma Linda, 24 Cal.4th 61, 77, 99 Cal.Rptr.2d 316, 5 P.3d 874 (2000) (quoting 7 Witkin, CALIFORNIA PROCEDURE, Judgment § 313 (4th ed. 1997)). Plaintiffs do not dispute that the action is final and that the time for challenging the state Court of Appeal's decision has expired.
Under California's primary rights theory:
Brodheim v. Cry, 584 F.3d 1262, 1268 (9th Cir.2009) (internal citations, quotations omitted). The critical focus is on the harm suffered. Id. "If the `primary right' sought to be vindicated in a subsequent suit is the same as that in an earlier suit, the second action will be precluded under California law." Maldonado v. Harris, 370 F.3d 945, 952 (9th Cir.2004) (quoting Mycogen Corp. v. Monsanto Co., 28 Cal.4th 888, 123 Cal.Rptr.2d 432, 51 P.3d 297 (2002)). A single cause of action arises from the harm suffered rather than on the legal theory advanced and does not depend upon the remedy sought. Slater v. Blackwood, 15 Cal.3d 791, 797, 126 Cal.Rptr. 225, 543 P.2d 593 (1975); McDowell v. Watson, 59 Cal.App.4th 1155, 1158, 69 Cal.Rptr.2d 692 (1997). Moreover, "even though two suits involve the same nucleus of facts, they do not necessarily raise the same cause of action under California law." Maldonado, 370 F.3d at 953. To resolve this dispute, the court "must compare the two actions, looking at the rights which are
In their appeal from the Superior Court's rejection of their administrative mandamus, plaintiffs argued that SMAQMD's permit program, with its exemption for equipment that emits less than two pounds of pollutants, is preempted by the Clean Air Act; that SMAQMD could not require a permit for the generator that runs the central plant because the generator is validly registered under the Portable Equipment Registration Program (PERP) as a portable combustion engine; that the central plant equipment does not emit two pounds of pollutants a day; and that SMAQMD's attempt to regulate HSG interferes with vested mining rights. (1/12/16 RFJN, Ex. A, ECF 67-1 at 4.) The Court of Appeal rejected all of the Hardestys' claims, ultimately concluding that SMAQMD's permit requirement did not interfere with their vested right to mine. (Id. at 4-5.)
Plaintiffs here argue, however, that the primary right they have asserted in the instant complaint "involves their constitutional rights to due process and equal protection. The primary wrong of the Defendants was to selectively, arbitrarily and irrationally define and apply certain regulations, as part of a greater conspiracy with Plaintiffs' Competitors in order to drive Plaintiffs out of business...." (Pls.' Opp'n, ECF 130 at 9.) They argue that the primary right in the abatement proceedings was the right to be free of regulation that was preempted by federal law, matched by defendants' duty not to exceed the scope of their authority when precluded by other law. (Id.) This argument is unavailing.
During the abatement proceedings and in this court plaintiffs complain about the impact of SMAQMD's actions on their ability to conduct their mining operations: the primary right is their interest in operating the mine while the injury is the impact of SMAQMD's enforcement on their business operations. Whether SMAQMD undertook enforcement in violation of state or federal law or because of Teichert's bidding, the impact on plaintiffs' mining operations is the same. Plaintiffs' instant claims raise a different theory, but not a different cause of action. See Weikel v. TCW Realty Fund II Holding Co., 55 Cal.App.4th 1234, 1249, 65 Cal.Rptr.2d 25 (1997) (defining the primary right as the plaintiff's interest in constructing a building at a particular location and the defendant's primary duty as the duty not to unreasonably interfere with that right). At argument on the motion, plaintiffs conceded they had the opportunity to raise their constitutional theories based on the federal Supremacy Clause or the Fourteenth Amendment in the state proceedings; as a result their claims based on the abatement proceedings are barred by res judicata. This bar covers their substantive due process claims to the extent that they are based on SMAQMD's application of rules plaintiffs claim are preempted by state and federal law, as well as any claim that their actions were contrary to state law.
Defendants contend that this court cannot consider any claims stemming from the denial of the permit because plaintiffs did not exhaust their administrative remedies and because the allegations fail to state a claim.
Defendants argue that plaintiffs' failure to challenge the permit denial constitutes
Defendants also cite to Moore v. City of Asheville, 396 F.3d 385, 388 (4th Cir.2005), which, relying on Younger, held that "a defendant to a coercive state administrative proceeding must exhaust his state administrative and judicial remedies and may not bypass them in favor of a federal court proceeding in which he seeks effectively to `annul the results' of a state administrative body." See also Baffert v. Cal. Horse Racing Bd., 332 F.3d 613 (9th Cir.2003) (applying Younger abstention to a § 1983 challenge to the decision of horse racing board suspending plaintiff's racing license). Despite their reliance on these cases, defendants provide no analysis of any factors that might support Younger abstention, do not explain why the denial of an application of a permit is coercive—except to assert that it is—even though "[d]etermining whether a proceeding is coercive or remedial does not always lend itself to a clear-cut answer." Hudson v. Campbell, 663 F.3d 985, 987 (8th Cir.2011). They do not even describe the nature of the permit application process, a factor important to the analysis. Baffert, 332 F.3d at 618 ("Whether the state proceedings are `judicial in nature' or `quasi-criminal' also plays a role in assessing the significance of the state interest"); Ohio Civil Rights Comm'n v. Dayton Christian Sch., 477 U.S. 619, 627 n. 2, 106 S.Ct. 2718, 91 L.Ed.2d 512 (1986) (recognizing that "if state law expressly indicates that the administrative proceedings are not `judicial in nature,' abstention may not be appropriate").
What remains of plaintiffs' substantive due process claim against the SMAQMD defendants is based on these defendants' alleged desire to punish plaintiffs unfairly as part of the Teichert campaign to drive plaintiffs out of business and the overbreadth of the permit denial, which advised plaintiffs that "any type of operation at the facility" would violate air pollution regulations. See Del Monte Dunes, 920 F.2d at 1508 (stating that parties had pleaded substantive due process violation when the landowner presented evidence that the city council reversed its approval of condominium project because of political pressure from other landowners to preserve the property as open space when the project otherwise complied with county requirements). In this case, plaintiffs have not alleged that they satisfied the requirements for the issuance of a permit or that SMAQMD would otherwise rescind the cease and desist order in the absence of a valid permit. Plaintiffs have failed to state a claim that these actions were arbitrary or irrational and thus violated
IT IS THEREFORE ORDERED that:
1. The State defendants' motion to dismiss (ECF No. 88) is granted as to Koehler, but denied in all other respects;
2. The motion to dismiss by Storelli and Moffitt (ECF No. 93) is denied;
3. The County defendants' motion to dismiss (ECF No. 94) is denied;
4. Gregory's motion to dismiss (ECF No. 95) is denied;
5. The SMAQMD defendants' motion to dismiss (ECF No. 97) is granted; plaintiffs' amended complaint, if they wish to file one, is due within twenty-one days of the date of this order; and
6. The case is set for pretrial scheduling conference on April 18, 2013, at 2:30 p.m. A joint pretrial scheduling report is due no later than April 11, 2013.
