The opinion of the court was delivered by: Garland E. Burrell, Jr. United States District Judge
ORDER GRANTING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT ON PLAINTIFF PERFINO'S FEDERAL CLAIM & DISMISSING PLAINTIFFS' REMAINING STATE CLAIM UNDER 28 U.S.C. § 1367(c)(3)*fn1
On March 29, 2010, Defendants Steve Hardy, Elizabeth Gavia and Lori Ajax ("Defendants") filed a motion for summary judgment on Plaintiffs' claims alleged in their first amended complaint. Later that same day an order was filed which decided Defendants' prior dismissal motion. The next day, on March 30, 2010, Defendants' filed an amended brief for their summary judgment motion in which they clarified that they only seek summary judgment on Plaintiffs' two claims that survived the March 29 dismissal order: Plaintiff Carlos Perfino's ("Perfino") federal equal protection claim and Plaintiffs' state claim for interference with contract. Defendants' motion on the remaining federal equal protection claim will be decided first. The crux of this claim is the allegation that Perfino was improperly prevented from obtaining a liquor license and operating a bar because of his status as a correctional officer. For the reasons stated below, Defendants' motion for summary judgment on Perfino's federal equal protection claim will be granted and Plaintiffs' remaining state claim will be dismissed without prejudice under 28 U.S.C. § 1367(c)(3).
A party seeking summary judgment bears the initial burden of demonstrating the absence of a genuine issue of material fact for trial. Celotex Corp. v. Catrett, 477 U.S., 317, 323 (1986). If this burden is satisfied, "the non-moving party must set forth, by affidavit or as otherwise provided in [Federal] Rule [of Civil Procedure] 56, specific facts showing that there is a genuine issue for trial." T.W. Elec. Serv., Inc. v. Pacific Elec. Contractors Ass'n, 809 F.2d 626, 630 (9th Cir. 1987) (quotations and citation omitted) (emphasis in original). This requires that the non-moving party "come forward with facts, and not allegations, [that] controvert the moving party's case." Town House, Inc. v. Paulino, 381 F.2d 811, 814 (9th Cir. 1967) (citation omitted); see also Beard v. Banks, 548 U.S. 521, 527 (2006) (finding that a party opposing summary judgment who "fail[s] [to] specifically challenge the facts identified in the [moving party's] statement of undisputed facts . . . is deemed to have admitted the validity of [those] facts . . . ."). "Mere argument does not establish a genuine issue of material fact to defeat summary judgment." MAI Sys. Corp. v. Peak Computer, Inc., 991 F.2d 511, 518 (9th Cir. 1993).
All reasonable inferences that can be drawn from the facts provided "must be drawn in favor of the non-moving party." Bryan v. McPherson, 590 F.3d 767, 772 (9th Cir. 2009). However, only admissible evidence may be considered. See Orr v. Bank of America, NT & SA, 285 F.3d 764, 773 (9th Cir. 2002) (stating that "[a] trial court can only consider admissible evidence in ruling on a motion for summary judgment") (citations omitted); Beyene v. Coleman Sec. Servs., Inc., 854 F.2d 1179, 1181 (9th Cir. 1988) (stating that "[i]t is well settled that only admissible evidence may be considered by the trial court in ruling on a motion for summary judgment").
II. STATEMENT OF UNCONTROVERTED FACTS
Plaintiffs' Responsive Separate Statement of Undisputed Facts ("SSUF") lists certain of Defendants' facts as "disputed"; however, Plaintiffs fail to provide admissible evidence that controverts Defendants' evidence. Further, Defendants have raised numerous evidentiary objections to Plaintiffs' declarations and exhibits. Those objections requiring decision are discussed below.
Plaintiffs Perfino and Zuranich were interested in opening a Latino-themed bar, and in January 2008, they met with Juan Ayala at a Starbucks to discuss purchasing his Alcoholic Beverage Control ("ABC") liquor license. (Pls.' SSUF ¶¶ 21-22.) Ayala had advertised the sale of his ABC liquor license on craigslist. (Id. ¶ 22.) At their meeting, Ayala told Plaintiffs that his ABC liquor license was not active. (Id. ¶ 25.) Ayala also told Plaintiffs that he did not want to sell his ABC license but would agree to open a bar with Plaintiffs using his license. (Id. ¶ 24.) That same day, Plaintiffs, Ayala and Rigoberto Galvez orally agreed to form a limited liability company to open a bar called Playa Azul in Sacramento, California. (Id. ¶¶ 26-27.)
Ayala filed a request with the State of California ABC on February 26, 2008 to reinstate his surrendered ABC liquor license, license No. 48-446084. (Id. ¶ 30.) Ayala had originally obtained his ABC liquor license on March 20, 2007. (Id. ¶ 19.) However, a month later, on April 18, 2007, Ayala surrendered the license. (Id. ¶ 20.) To reinstate a liquor license that has been surrendered for more than six months, an ABC licensing representative must conduct an investigation of the premises for which the license issued to ensure that tenancy exists and that the premises licensed have not been altered. (Id. ¶ 8.) Ayala's liquor license was for the premises located at 5420 Auburn Boulevard in Sacramento("the premises"). (Id. ¶ 36.)
On March 10, 2008, Defendant Gavia, an ABC licensing representative, was assigned to investigate the premises for which Ayala had been issued a liquor license. Gavia told Ayala on March 25, 2008 that all persons listed on the lease for the premises must be qualified to hold an ABC license and must appear on the application. (Id. ¶ 43.) At that time, Ayala, Perfino, Zuranich and Galvez were named on the lease for the property at 5420/5430 Auburn Boulevard. (Id. ¶ 42.) Gavia also advised Ayala that a "Person to Person" transfer application was required to add additional people to his liquor license and this application had to be submitted before the liquor license could be re-instated. (Id. ¶¶ 10, 44.)
Ayala, Perfino, Zuranich and Galvez formed the Linear Marketing Group Media LLC (the "LLC"), for which articles of incorporation were filed on March 27, 2008. (Id. ¶ 45.) The LLC was formed for the purpose of operating a bar called Playa Azul at 5420/5430 Auburn Boulevard, in Sacramento, California. (Id. ¶¶ 45-46.) That same day, Ayala submitted "an application for a Person to Person transfer" (the "application for transfer") to ABC "to add other persons to [his] license." (Id. ¶¶ 44, 47.) Specifically, "Ayala [sought to] . . . transfer . . . [his] ABC license to [the LLC]." (Id. ¶ 47.) The application for transfer listed Perfino's occupation as a correctional officer. (Id. ¶ 55.)
The next day, on March 28, 2008, Ayala's ABC license was reinstated and the LLC was given a temporary permit to operate under while ABC investigated Ayala's application for transfer, and the members of the LLC to ensure they were qualified to hold a liquor license. (Id. ¶¶ 49, 51.) A temporary permit is issued before an ABC investigation of the prospective licensees is completed and is separate and distinct from an approved on-sale general public premises liquor license. (Id. ¶¶ 53-54.)
While reviewing Ayala's application for transfer, Gavia was informed by her supervisor that section 62 of the California Code of Regulations ("section 62"), prescribes that correctional officers may not be issued a liquor license. (Id. ¶ 56.) On April 10, 2008, Gavia informed "Zuranich that Perfino did not qualify to hold an ABC liquor license because of his status as a correctional officer." (Id. ¶ 59.)
However, on May 8 or 9, 2008, before Gavia could complete her investigation of the application for transfer, Ayala "notified" Zuranich and Perfino that he "no longer wanted to be in business with . . . Zuranich because Zuranich had failed to put money into the business" and that "he wanted to withdraw the transfer application." (Id. ¶¶ 60-61.) "Before [Defendant] Gavia could finish her ...