R. BROOKE JACKSON, District Judge.
This matter comes before the Court on Defendants' Motion to Dismiss [ECF No. 7]. The Court exercises jurisdiction pursuant to 28 U.S.C. § 1331. For the following reasons, the motion is granted.
This case stems out of a criminal charge brought against the former Director of Operations for Roof America Corporation ("Roof America"), the plaintiff. Roof America alleges violations of its Fourteenth Amendment procedural due process rights, claiming economic injuries resulting from the shutting down of its business at the beginning of the busy season for roofing contractors. Though it originally brought claims against both Joseph Morales and Mitchell Morrissey, the plaintiff has voluntarily dropped all claims against Mr. Morrissey. See [ECF No. 19 at 15]. As such, the Court will focus solely on the allegations made against Mr. Morales.
For purposes of this motion, the Court accepts as true all well-pleaded allegations in the Complaint. Roof America was formed as a roofing contractor company on October 21, 2011. At that time, its Director of Operations was Adelbert Bassford, going by the pseudonym Jack Bass. Roof America's business model consisted of charging roofing companies a $10,000 fee in exchange for a guarantee of fifty roofing jobs during the next roofing season, which begins in May or June in Colorado. Roof America would also be entitled to half of the profits generated from each of the jobs it arranged. Twenty roofing companies paid a total of $200,000 to join the Roof America Certified Contractor Network. According to the plaintiff, the unconstitutional actions of Mr. Morales rendered it unable to fulfill its obligations to its contractor partners, thereby causing it substantial economic injury.
According to the Complaint, Mr. Morales is the Chief Deputy District Attorney for the Economic Crimes Unit, Second Judicial District Attorney's Office. On May 3, 2013 Mr. Morales had Mr. Bassford arrested for attempting to influence a public servant and for criminal impersonation. The next day Mr. Morales emailed the Communications Director of the Denver District Attorney's Office, Lynn Kimbrough, the following:
Complaint [ECF No. 1] ¶ 15.
On Monday May 6, 2013 Ms. Kimbrough issued a press release entitled "Convicted Scammer Arrested in New Scheme." The press release reads in full:
Denver DA News Release [ECF No. 7-2].
That same day, Roof America's Vice President for Operations James Mosel called Mr. Morales and left him a voicemail. The Complaint is silent as to the content of the message. The next day Mr. Morales, along with investigator Brad Uyemura, called back Mr. Mosel. During the call, Mr. Morales allegedly told Mr. Mosel
Id. ¶ 18. Mr. Morales then told Mr. Mosel to meet him at the Roof America office later that day "because it would be a lot easier if Mr. Mosel opened the doors for Mr. Morales and Mr. Uyemura, rather than break the door down or changing the locks." Id. ¶ 19. Mr. Morales also told Mr. Mosel that he would come to the Roof America offices later that day with a document that would permit him to enter the premises, though he never did. Id. ¶¶ 19, 22.
Roof America contends that "Mr. Mosel complied with the Chief Deputy District Attorney's demands, expecting Morales to call back [and] arrive at the office later that day," but that Mr. Morales never called back. Id. ¶ 20. The next day, on May 8, 2013, Mr. Mosel returned to the office to get a power cord for his computer. While at the office he allegedly received a call from Mr. Uyemura asking him why he was in the office. However, there have been no allegations made that he was ordered to leave the premises.
On May 13, 2013 charges were filed against Mr. Bassford.
The plaintiff contends that due to the publicity generated by Mr. Morales and the Denver District Attorney's Office, as well as the loss of employees, certified contractors, and customer affiliates caused by Mr. Morales' efforts to shut down the business, it was not possible to reopen Roof America. Roof America brings one claim against Mr. Morales in his individual capacity, a 42 U.S.C. § 1983 claim alleging a violation of Roof America's Fourteenth Amendment procedural due process rights.
Rule 12(b)(1) concerns whether the Court has jurisdiction to hear the case before it. "Federal courts are courts of limited jurisdiction and, as such, must have a statutory basis to exercise jurisdiction." Montoya v. Chao, 296 F.3d 952, 955 (10th Cir. 2002). "Jurisdiction is a threshold question that a federal court must address before reaching the merits of a statutory question, even if the merits question is more easily resolved and the party prevailing on the merits would be the same as the party that would prevail if jurisdiction were denied." Id. "[S]tatutes conferring jurisdiction on federal courts are to be strictly construed, and doubts resolved against federal jurisdiction." F & S Const. Co. v. Jensen, 337 F.2d 160, 161 (10th Cir. 1964). "The burden of establishing subject-matter jurisdiction is on the party asserting jurisdiction." Montoya, 296 F.3d at 955 (citing Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994)). Subject matter jurisdiction may be challenged by a party or raised sua sponte by the Court at any point in the proceeding. Fed. R. Civ. P. 12(h)(3); Harris v. Illinois-California Exp., Inc., 687 F.2d 1361, 1366 (10th Cir. 1982).
In reviewing a 12(b)(6) motion to dismiss, the Court must accept the well-pleaded allegations of the complaint as true and construe them in the plaintiff's favor. However, the facts alleged must be enough to state a claim for relief that is plausible, not merely speculative. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 570 (2007). A plausible claim is a claim that "allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). Allegations that are purely conclusory need not be assumed to be true. Id. at 681. However, so long as the plaintiff offers sufficient factual allegations such that the right to relief is raised above the speculative level, he has met the threshold pleading standard. See, e.g., Twombly, 550 U.S. at 556; Bryson v. Gonzales, 534 F.3d 1282, 1286 (10th Cir. 2008).
To plead a claim for relief under 42 U.S.C. § 1983, a plaintiff must show that the defendant, acting under color of state law, deprived him of a right secured by the United States Constitution or its laws. Am. Mfrs. Mut. Ins. Co. v. Sullivan, 526 U.S. 40, 49-50 (1999). "A defendant may not be held liable under § 1983 unless he or she subjected a citizen to the deprivation, or caused a citizen to be subjected to the deprivation." Lippoldt v. Cole, 468 F.3d 1204, 1219 (10th Cir. 2006) (alterations and citation omitted).
The Due Process Clause of the Fourteenth Amendment protects against state deprivations of life, liberty, or property without due process of law. U.S. Const. amend. XIV, § 1. To assert a due process violation, a plaintiff must show that he possessed a protected interest under the Due Process Clause, and that he was not afforded an appropriate level of process before being deprived of that interest. See Farthing v. City of Shawnee, Kan., 39 F.3d 1131, 1135 (10th Cir. 1994). The contours of property interests are not found within the Constitution; instead, property interests "are created and their dimensions are defined by existing rules or understandings that stem from an independent source such as state law." Bd. of Regents of State Colleges v. Roth, 408 U.S. 564, 577 (1972).
"[A]cts undertaken by a prosecutor in preparing for the initiation of judicial proceedings or for trial, and which occur in the course of his role as an advocate for the State, are entitled to the protections of absolute immunity." Buckley v. Fitzsimmons, 509 U.S. 259, 273 (1993). This immunity applies equally in Section 1983 actions. See Imbler v. Pachtman, 424 U.S. 409, 410 (1976). However, "[a] prosecutor's administrative duties and those investigatory functions that do not relate to an advocate's preparation for the initiation of a prosecution or for judicial proceedings are not entitled to absolute immunity." Buckley, 509 U.S. at 273. "When a prosecutor performs the investigative functions normally performed by a detective or police officer, it is `neither appropriate nor justifiable that, for the same act, immunity should protect the one and not the other.'" Id. (quoting Hampton v. City of Chicago, Cook Cnty., Ill., 484 F.2d 602, 608 (7th Cir. 1973)). For example, if a prosecutor plans and executes a raid on suspicion of ongoing criminal activity, "he `has no greater claim to complete immunity than activities of police officers allegedly acting under his direction.'" Id. at 274 (quoting Hampton, 484 F.2d at 608-09).
Drawing a distinction between actions which are primarily investigative or administrative in nature and actions which are taken in connection with the judicial process can be difficult; "there is no bright line between advocacy and investigation." Mink v. Suthers, 482 F.3d 1244, 1261 (10th Cir. 2007). However, "the determinative factor is `advocacy' because that is the prosecutor's main function and the one most akin to his quasi-judicial role." Rex v. Teeples, 753 F.2d 840, 843 (10th Cir. 1985). "Thus, the more distant a function is from the judicial process and the initiation and presentation of the state's case, the less likely it is that absolute immunity will attach." Pfeiffer v. Hartford Fire Ins. Co., 929 F.2d 1484, 1490 (10th Cir. 1991). "In sum, a prosecutor is entitled to absolute immunity for those actions that cast him in the role of an advocate initiating and presenting the government's case. Absolute immunity, however, does not extend to those actions that are investigative or administrative in nature . . . ." Mink, 482 F.2d at 1261-62.
Mr. Morales argues that he is entitled to prosecutorial immunity because the plaintiff's due process claim is premised on actions Mr. Morales took after Mr. Bassford had already been arrested. According to Mr. Morales, shutting down Roof America's operations following Mr. Bassford's arrest would be consistent with the preservation of evidence for trial such that his actions were that of an advocate preparing for trial. The Court is not persuaded. First and foremost, the Complaint never alleges that Mr. Morales actually shut down Roof America; in fact, this is a large component of Mr. Morales' qualified immunity defense. Yet even if it did, the plaintiff contends that Mr. Morales never appeared at the office to search or seize any evidence held by Roof America. Therefore, any claim that Mr. Morales shut down the business for purposes of gathering evidence for trial fails on the face of the Complaint.
Based on the Court's reading of the Complaint, Mr. Morales prompted Mr. Mosel to shut down the business, though without specifically ordering him to do so. In this Court's view, those actions are far more akin to investigative functions normally performed by a detective or police officer than to the advocacy of a judicial officer. And it is neither appropriate nor justifiable that absolute immunity should protect Mr. Morales where it would not protect a police officer or detective who performs the same actions.
In the alternative, Mr. Morales argues that he is entitled to qualified immunity. "Qualified immunity balances two important interests—the need to hold public officials accountable when they exercise power irresponsibly and the need to shield officials from harassment, distraction, and liability when they perform their duties reasonably." Pearson v. Callahan, 555 U.S. 223, 231 (2009). Qualified immunity protects state actors from liability as well as suit but only if their conduct does not violate clearly established constitutional rights of which a reasonable person should have known. Id. at 231-32. "This inquiry turns on the objective legal reasonableness of the action, assessed in light of the legal rules that were clearly established at the time it was taken." Id. at 244 (internal quotation marks and citation omitted). Overall, qualified immunity "operates to ensure that before they are subjected to suit, officers are on notice that their conduct is unlawful." Hope v. Pelzer, 536 U.S. 730, 731 (2002).
"After a defendant asserts a qualified immunity defense, the burden shifts to the plaintiff." Medina v. Cram, 252 F.3d 1124, 1128 (10th Cir. 2001). The plaintiff must establish that (1) the defendant's actions violated a constitutional right, and (2) the constitutional right was clearly established. See e.g., id.; Martinez v. Beggs, 563 F.3d 1082, 1088 (10th Cir. 2009). The Court has discretion in deciding which of the two prongs should be analyzed first. Martinez, 563 F.3d at 1088. And "[e]ven though the plaintiff bears the burden of making this two-part showing, we construe the facts in the light most favorable to the plaintiff as the nonmoving party." Kaufman v. Higgs, 697 F.3d 1297, 1300 (10th Cir. 2012) (internal quotation marks, alterations, and citations omitted).
The Court begins with the first prong. Roof America maintains that two actions taken under the color of state law unconstitutionally deprived it of its property rights: the publication of the press release and the alleged statements of Mr. Morales made during the phone call with Mr. Mosel. Beginning with the press release, the plaintiff contends that because the publication damaged its reputation, which caused it to lose business, the press release deprived Roof America of its constitutionally-protected property rights. Yet the plaintiff does not allege that the statements contained in the press release were false. Its publication is therefore not actionable. See Workman v. Jordan, 32 F.3d 475, 480-81 (10th Cir. 1994) (explaining that while an individual has a liberty interest in his good name and reputation — which can translate into a property interest in continued employment — damaging statements must be false in order to be actionable). Moreover, the plaintiff cites no authority for the implied proposition that it has a property interest in its reputation that could trigger a due process claim. See Paul v. Davis, 424 U.S. 693, 712 (1976); Gen. Elec. Co. v. Jackson, 610 F.3d 110, 121 (D.C. Cir. 2010) (holding that injuries resulting from market reactions to a public administrative order were insufficient to merit constitutional protection because "stigma alone is insufficient to invoke due process protections"). Though the press release may have damaged Roof America's reputation, the plaintiff has not alleged a due process claim arising from the press release upon which relief could be granted.
With respect to the one phone call between Mr. Mosel and Mr. Morales, the facts alleged do not plausibly state a claim that the plaintiff suffered a deprivation of its property pursuant to state action. Plaintiff's counsel mischaracterizes the allegations from the Complaint in its Response brief, describing Mr. Morales as having
The Court finds that the plaintiff has failed to allege a plausible claim that it suffered an unconstitutional deprivation of its procedural due process rights. Because Roof America has not established that the defendant's actions violated a constitutional right, the Court need not continue its qualified immunity analysis.
For the foregoing reasons, Defendants' Motion to Dismiss [ECF No. 7] is GRANTED. Final judgment will enter in favor of the defendant dismissing the case and all claims therein. Defendant is awarded costs pursuant to Fed. R. Civ. P. 54(d)(1) and D.C.COLO.LCivR 54.1.
