The opinion of the court was delivered by: Sandra M. Snyder United States Magistrate Judge
ORDER GRANTING SUMMARY JUDGMENT TO DEFENDANT AND DISMISSING COMPLAINT (Docs. 17 & 19)
Both Defendant City of Kerman, by its attorneys, Henry, Logoluso & Blum, and Plaintiffs Louis and Karen Lopez, by their attorneys, Reich Law Firm, move for summary judgment (Docs. 17 and 19). The parties have consented to the jurisdiction of a U.S. Magistrate Judge (Doc. 13). This Court has reviewed the papers and has determined that this matter is suitable for decision without oral argument pursuant to Local Rule 78-230(h). Having considered all written materials submitted, the Court grants summary judgment to Defendant and orders that this case be dismissed.
A. Applicable Municipal Law
On February 16, 1970, Defendant adopted Ordinance No. 178, authorizing Defendant to enter into contracts, exclusive or otherwise, with solid waste disposal contractors. Any such contract was to refer to the ordinance and to require the contractor to supply a performance bond. The ordinance established a mechanism for setting collection schedules, rates, and charges. Types of waste included garbage (e.g., kitchen and table refuse, animal and vegetable matter), rubbish (e.g., paper, cardboard, rags, glass), and garden refuse. All waste was only to be stored in cans or bins supplied by Defendant or its contractor. The contractor was required to collect all waste in closed, water-tight vehicles to prevent spilling. The Superintendent of Public Works was required to inspect and supervise all collection and disposal vehicles to ensure that they were clean and sanitary, and complied with all requirements of the ordinance.
On November 15, 1994, Defendant adopted Ordinance No. 94-08, which continued the provisions of Ordinance No. 178 for written contracts and performance bonds with solid waste removal contractors. Among other provisions, Ordinance 94-08 amended § 08.12.040 of the Municipal Code to add "materials capable of recycling" as a category of waste. The ordinance specified that the collection charges for "business houses" would include collection of recyclables. The ordinance amended the required contract terms and required any contractor to post a bond issued by a surety.
Before June 2008, Defendant failed to recycle or divert fifty percent of its total refuse as required by state law. In 2008, Defendant consulted with Mid-Valley Disposal, other cities, and the California Integrated Waste Management Board to draft an ordinance addressing Defendant's goals of attaining certain recyclable diversion rates for recyclables. On June 4, 2008, Defendant adopted Ordinance No. 08-02.
Intended to meet the requirements of AB939, Ordinance 08-02 required Kerman's administration to enter into an exclusive contract with a hauler of solid waste, recyclables, green waste, and demolition debris. It explicitly stated that the franchise hauler was to be the only hauler to remove any such waste materials, prohibited any resident from contracting with a competing hauler for removal of waste or recyclables, and prohibited any competing hauler from collecting solid waste, recyclables, green waste, and demolition debris. The ordinance incorporated an anti-scavenging provision. It amended the ordinances to reflect current solid waste practices, including collection of source-separate recyclables.
B. Additional Undisputed Facts
Since 1992, Plaintiffs have operated a recycling center in the City of Kerman as "Dreams Recycling." The center purchases from third parties and resells for recycling aluminum, glass, plastic, bimetal, copper wire, scrap aluminum, newspaper, cardboard, refrigerators, stoves, televisions, and e-waste. According to Plaintiff Louis Lopez, "so long as I could make a penny out of it, it was recyclable." Plaintiffs do not collect garbage or refuse.
Plaintiffs secured a Kerman business license only as a recycling center. The California Department of Conservation, Division of Recycling, certifies Plaintiffs to collect aluminum, glass, plastic, and metals in two Kerman locations: 15401 W. California and 15057 W. Whitesbridge. Since December 2009, the State of California has certified Plaintiffs for collection of e-waste. Plaintiffs have no certification or other permit for collection of cardboard.
Both center locations are zoned for commercial use. Neither location may be used for a trash hauling business. (Properties used for trash hauling businesses are restricted to Defendant's industrial park zone.)
Plaintiffs never requested a Kerman business license for solid waste hauling, handling, or for a solid waste enterprise. They never sought an exclusive contract for collection of cardboard or any other material from businesses. Plaintiffs have never provided a performance bond or proof of insurance for the collection of cardboard or any other material. They never promulgated a rate schedule for any of their collection services.
Similarly, Plaintiffs never sought a license from the State of California or from any county or municipality for collecting and transporting recyclable material to their business locations. They have never secured a permit for the operation of a solid waste collection vehicle from Defendant, Fresno County Department of Health, the State of California, or the federal government.
Beginning in or about 1993, Plaintiffs occasionally picked up recyclable materials from Kerman residents. As residents began to know Plaintiffs, Plaintiffs received more pick-up requests. Plaintiffs picked up recyclable materials, including cardboard, from Kerman, Fresno, Mendota, San Joaquin, and Tranquility. They had a regular route only for cardboard pick-up, which represented from 95 to 98 percent of the material they collected from businesses. Plaintiffs never paid any business for the cardboard they collected, nor did they pay for any materials collected from schools.
Customers called Plaintiffs for pick-up of other recyclables. Within Kerman, Plaintiffs collected cardboard, newspaper, and white paper. Plaintiffs collected aluminum from Boyd's shop only.
Plaintiffs had no written contracts for pick-up of recyclables. Beginning in 1992, they operated their scrap metal business on an all-cash basis, keeping no records. Plaintiffs kept no records of their pick-ups, except for televisions and other items including cathode-ray tubes, which they were required to report to the State of California. Plaintiffs did not keep copies of the reports sent to the state. As a result, no records are available to identify what portion of Plaintiffs' earnings was derived from cardboard recycling, how much cardboard was collected from businesses, or the tonnage of cardboard collected annually in any year. Nor do Plaintiffs have any records for the years 2005-2008 of the recycled appliances that Plaintiffs picked up from customers for free. Defendant requested annual recycling tonnage reports from Plaintiffs, who provided information for only two years, both prior to 2000.
From 1998 through July 31, 2008, Browning-Ferris Industries ("BFI"), later named Allied Waste, provided trash collection and hauling, including recycling, pursuant to exclusive contracts with Defendant.
When Plaintiffs began living in Kerman in 2004, they were aware that BFI provided solid waste collection, including pick-up of recyclables, from residences, businesses, and schools.
In early 2008, Defendant issued a request for proposals for a new exclusive franchise for solid waste handling services in Kerman. Plaintiffs did not submit a proposal.
Defendant granted Mid-Valley Disposal Services the "Solid Waste Collection, Transportation and Disposal Services Franchise." Mid-Valley reported to City Manager Ron Manfredi that Plaintiffs were picking up recyclables from various Kerman businesses. On July 16, 2008, Defendant notified Plaintiffs that their placement of cardboard bins and collection of cardboard from local businesses violated the Ordinance 08-02 and that Mid-Valley Disposal was the exclusive collector of recyclables in Kerman.
Plaintiffs continue to collect cardboard from the Kerman Burger King, the flea market, Boyd's industrial properties, and the local ARC workshop. Because Plaintiffs have kept no records, they cannot determine the difference between the amount of cardboard they now collect and the amount collected before enactment of Ordinance No. 08-02.
Summary judgment should be granted "if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." F.R.Civ.P. 56(c)(2); Adickes v. S.H. Kress & Co., 398 U.S. 144, 157 (1970); Fortyune v. American Multi-Cinema, Inc., 364 F.3d 1075, 1080 (9th Cir. 2004). The party seeking summary judgment bears the initial burden of establishing the basis of its motion and of identifying the portions of the declarations, pleadings, and discovery that demonstrate absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986); Soremekun v. Thrifty Payless, Inc., 509 F.3d 978, 984 (9th Cir. 2007). A fact is material if it could affect the outcome of the suit under applicable law. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-49 (1986); Thrifty Oil Co. v. Bank of America Nat'l Trust & Savings Ass'n, 322 F.3d 1039, 1046 (9th Cir. 2003). A dispute about a material fact is genuine if there is sufficient evidence for a reasonable jury to return a verdict for the non-moving party. Anderson, 477 U.S. at 248; Long v. County of Los Angeles, 442 F.3d 1178, 1185 (9th Cir. 2006).
When the moving party will have the burden of proof on an issue at trial, it must demonstrate that no reasonable trier of fact could find other than for the moving party. Soremekun, 509 F.3d at 984. When the non-moving party will have the burden of proof on an issue at trial, the movant may prevail by presenting evidence that negates an essential element of the non-moving party's claim or merely by pointing out that no evidence supports an essential element of the non-moving party's claim. See Soremekun, 509 F.3d at 984; Nissan Fire and Marine Ins. Co. v. Fritz Cos., Inc., 210 F.3d 1099, 1105-06 (9th Cir. 2000). If a moving party fails to carry its burden of production, then "the non-moving party has no obligation to produce anything, even if the non-moving party would have the ultimate burden of persuasion." Nissan Fire & Marine, 210 F.3d at 1102-03. If the moving party meets its initial burden, the burden then shifts to the opposing party to establish that a genuine issue as to any material fact actually exists. See Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986); Nissan Fire & Marine, 210 F.3d at 1103. The opposing party cannot "'rest upon ...