This case was on calendar on June 8, 2011 for a hearing on motions to dismiss filed by defendants Sacramento Metropolitan Air Quality Management District and David Grose (SMAQMD defendants); Sacramento County and Robert Sherry (County defendants); State of California, acting by and through California State Mining and Geology Board (SMGB), Office of Mine Reclamation (OMR), Department of Fish and Game (DFG), James Goldstene, Dennis O'Bryant, Gay Norris, Steve Testa, and Elizabeth Gregory (referred to generally as "state defendants" or named individually); and Zachary Simmons. The SMAQMD, state and county defendants argue that the complaint fails to state a claim under Rule 12(b)(6); Simmons argues that the court lacks subject matter jurisdiction under Rule 12(b)(1) and that the complaint fails to state a claim under 12(b)(6).
Plaintiffs' motion for leave to file an amended complaint and a motion for sanctions filed by the SMAQMD defendants also are pending.
As explained below, plaintiffs' motion to file an amended complaint is granted. The SMAQMD defendants' motion to stay is granted. The state, federal and county defendants' motions to dismiss are granted in part, and the SMAQMD motion for sanctions is denied.
I. The Impact Of The Motion To Amend
Both plaintiffs' original and their proposed amended complaints describe a series of actions taken against plaintiffs, who operate a gravel mining operation in Sacramento County and who allege that their ability to continue their mining operations has been disrupted by a series of actions taken by defendants after A. Teichert & Sons, one of plaintiffs' main competitors, contacted the agencies to ask them to regulate plaintiffs and thus drive their prices up.
The original complaint contains seven claims: (1) a violation of the Clean Air Act against the SMAQMD defendants, Sacramento County, and James Goldstene; (2) a civil rights claim,*fn1 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 OMR, Norris and O'Bryant; (4) a civil rights claim alleging due process violations against SMGB and Testa; (5) a Bivens claim alleging violations of the Fourth and Fifth Amendments against Simmons; (6) a civil rights claim alleging a Fourth Amendment violation against Gregory and DFG; and (7) a civil rights claim alleging violations of the Fifth and Fourteenth Amendments against the county defendants. ECF No. 2.
The proposed amended complaint drops as defendants the State of California, DFG, SMGB, OMR and Goldstene, but seeks 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 contains 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 action, 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).
Defendants Sacramento County, Storelli, Moffit and Sherry argue that the amendment should not be permitted because the complaint fails to state a cause of action against them. ECF No. 48. The state defendants argue that the motion to amend was not timely filed so as to be heard on the court's June 8 calendar. ECF No. 43. They also argue plaintiffs filed the request too late, namely seventy-two days after the state defendants filed their motion to dismiss. ECF No. 43 at 4. Plaintiffs respond that the motion was timely filed, that the defendants will not be prejudiced by amendment, and that their request should be granted because defendants did not meet and confer before they filed the motions to dismiss. Defendants Simmons and Jewell argue that the amendment would be futile because the amended complaint does not state a claim against them. ECF No. 44.
A properly filed amended complaint supersedes the original complaint and constitutes a waiver of those claims in the original complaint that are not included in the amended complaint. As a result, when an amended complaint is filed while a motion to dismiss is pending, it generally moots the motion to dismiss. Ferdik v. Bonzelet, 963 F.2d 1258, 1262 (9th Cir. 1992) (amended pleading supersedes the original pleading); Sechrest v. Ignacio, 549 F.3d 789, 804 (9th Cir. 2008), cert. denied sub nom., McDaniel v. Sechrest, __ U.S. __, 130 S. Ct. 243 (2009) (amendment of a complaint constitutes waiver of claims not carried over from previous versions of the complaint); Marty v. Wells Fargo Bank, 2011 WL 1103405, at *1 (E.D Cal. Mar. 22, 2011) (amendment moots motion to dismiss).
Under Federal Rule of Civil Procedure*fn2 15(a)(1)(B) and 15(a)(2), a party may amend a pleading as a matter of course within twenty-one days after serving it or, if the complaint is one to which a responsive pleading is required, within twenty-one days after the service of a motion under Rule 12(b). In this case, the state, county and SMAQMD defendants filed their motions to dismiss on February 28, 2011; the state defendants filed an amended motion to dismiss on May 6, 2011. Simmons filed his motion to dismiss on April 29, 2011. Plaintiffs filed their motion to amend on May 11, 2011.
Although defendants have not raised Rule 15 directly, plaintiffs recognize its impact and argue that the amended complaint is timely, at least as to Simmons, because it was filed within twenty-one days of the filing of Simmons' motion to dismiss. ECF No. 56 at 5. There is little law on the question whether a motion to amend is timely as to all defendants if filed within twenty-one days of the filing of the last-filed motion to dismiss. See Barksdale v. King, 699 F.2d 744, 747 (5th Cir. 1983) (under prior version of Rule 15, plaintiff's right to amend complaint as to those who had not answered continued even after some defendants had answered); but see Lau v. Guam Dept. Of Education, 2011 WL 2531061, at *3 (D. Guam June 23, 2011) (under current version of Rule 15, plaintiff could not amend as matter of course when not within 21 days of first motion, though request was filed before second motion).
This court, however, need not reach whether the motion to amend is timely. As a practical matter and a matter of judicial economy, ignoring the amended complaint makes little sense, particularly when that proposed document does not include some of the claims under attack in the motion to dismiss. Ignoring the amended complaint also makes little sense in light of the Ninth Circuit's admonition that district courts should grant leave to amend when dismissing a case for failure to state a claim, "unless the court determines that the pleading could not possibly be cured by the allegations of other facts." Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000) (quoting Doe v. United States, 58 F.3d 494, 497 (9th Cir. 1995)). With the amended complaint on file, the court can better determine whether any deficiencies are curable.
Accordingly, in resolving the pending motions to dismiss, the court will consider the amended complaint, to the extent that it contains claims substantially similar to the original complaint. Also in light of that complaint, the court deems the original claim of a violation of the Clean Air Act and all claims against the State of California and the state agencies to have been waived, and grants the motion to dismiss as to that claim and those defendants.
II. Standards For A Motion To Dismiss
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, 129 S. Ct. 1937, 1949 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (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. at 1949 (quoting Twombly, 550 U.S. at 555). 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 1950. 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 (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 (2007). This rule does not apply to "'a legal conclusion couched as a factual allegation,'" Papasan v. Allain, 478 U.S. 265, 286 (1986) (quoted in Twombly, 550 U.S. at 555), nor to "allegations that contradict matters properly subject to judicial notice" or to material attached to or incorporated by reference into the complaint. Sprewell v. Golden State Warriors, 266 F.3d 979, 988-89 (9th Cir. 2001). A court's consideration of documents attached to a complaint or incorporated by reference or matter of judicial notice will not convert a motion to dismiss into a motion for summary judgment. United States v. Ritchie, 342 F.3d 903, 907 (9th Cir. 2003); Parks School of Bus. v. Symington, 51 F.3d 1480, 1484 (9th Cir. 1995); compare Van Buskirk v. CNN, 284 F.3d 977, 980 (9th Cir. 2002) (noting that even though court may look beyond pleadings on motion to dismiss, generally court is limited to face of the complaint on 12(b)(6) motion).
III. SMAQMD Defendants' Motion To Dismiss
A. Allegations In Amended Complaint
In the FAC plaintiffs allege that in April 2009, SMAQMD issued a petition alleging that Hardesty Sand and Gravel (HSG) was operating equipment, specifically a generator and several engines, in violation of its Rule 201, despite the fact that regulation of the non- stationary engine is prohibited by state law and that regulation of other pieces of the equipment is preempted by the Clean Air Act (CAA), 42 U.S.C. §§7401, et seq. FAC, ECF No. 42-1 ¶¶ 57-58. Plaintiffs allege that SMAQMD's Rule 201 is in direct violation of several provisions of the CAA. Id. ¶¶ 61-62.
Plaintiffs further allege that at the hearing on the Order of
Abatement, defendant Grose,*fn3 an employee of SMAQMD
relied on SMAQMD's policy about engines on single sites and fixed
locations, which policy the hearing panel and later the Superior Court
accepted and which is not applied to similarly situated people. FAC ¶¶
63-64. SMAQMD's definition is an improper underground regulation, used
to expand SMAQMD's jurisdiction from stationary engines to portable
engines. Id. ¶ 65. Plaintiffs sought review of the Order of Abatement
in the Superior Court, which upheld the abatement order. Id. ¶ 70.
Thereafter, plaintiffs spent over $50,000 to apply for permits from
SMAQMD, but defendant Grose denied the request, notifying them that
any type of operation at the mine is a violation of various
regulations, subject to penalties, as well as a violation of the
abatement order. Id. ¶ 72. With these facts as a backdrop, plaintiffs
allege that the SMAQMD defendants have deprived plaintiffs of their
rights under the Supremacy Clause and the Due Process Clause, through
their regulation of construction equipment operating with less than
175 horsepower and enforcement of that regulation, their declaring the
mine to be a single site in violation of 40 CFR § 89.2,*fn4
and issuing an order that plaintiffs cannot use equipment to
load rock. Id. ¶ 95. In addition, defendants have violated plaintiffs'
due process rights by designating the 3800 acre mine as a single site
despite Environmental Protection Agency (EPA) rulings that this could
not constitute a single site. Id.
¶ 96. Defendants have also violated plaintiffs' rights under the
Supremacy and Due Process clauses by creating an emission standard,
which requires plaintiffs to purchase a permit to
undertake emissions in excess of two pounds per day. Id. ¶ 97.
Finally, plaintiffs allege that defendants have violated their right
to equal protection by defining the mine as a single site without
using the same definition with similarly situated people. Id. ¶ 98. In
the FAC, plaintiffs seek only damages, having dropped the claim for
equitable relief contained in the original complaint. Compare ECF No.
42 ¶ 99 with ECF No. 2 ¶ 68.
B. Arguments For Dismissal
Citing Younger v. Harris, 401 U.S. 37 (1971), the SMAQMD defendants argue that the claims should be dismissed in light of pending state proceedings. They also rely on the abstention doctrine of Colorado River Water Conservation District v. United States, 424 U.S. 813 (1976), as an alternative basis for dismissal. Finally, they contend that the complaint fails to state a claim against them.
1. Request For Judicial Notice; Evidentiary Exhibits
The SMAQMD defendants ask the court to take judicial notice of a number of documents, including the letter denying permits, SMAQMD rules, the petition for an order of abatement, the Order of Abatement, plaintiffs' petition for a writ of mandate and related briefing filed in Sacramento County Superior Court, the Superior Court's ruling, and the notice of appeal. ECF Nos. 28 & 66. The state defendants have asked the court to take judicial notice of the decision of the Court of Appeal, Third Appellate District. ECF No. 66.
Plaintiffs oppose these requests on the ground that consideration of evidence outside the scope of the complaint or FAC and its attachments is not proper on a Rule 12(b)(6) motion to dismiss. ECF No. 49 at 6-7. Nevertheless, they attach several exhibits to their opposition, to which the SMAQMD defendants object. ECF No. 58-1.
Under Rule 201 of the Federal Rules of Evidence, a court may take judicial notice of an adjudicative fact which "must be one not subject to reasonable dispute in that it is either (1) generally known . . . (2) or capable of accurate and ready determination by resort to sources whose accuracy cannot reasonably be questioned." When appropriate, a court may take judicial notice of documents without converting a motion to dismiss into a motion for summary judgment. MGIC Indemnity Corporation v. Weisman, 803 F.2d 500, 504 (9th Cir. 1986). It is the proponent's burden to show that the facts contained in the documents are proper subjects of judicial notice. Hurd v. Garcia, 454 F.Supp.2d 1032, 1054-55 (S.D. Cal. 2006).
In addition, "a district court ruling on a motion to dismiss may consider a document the authenticity of which is not contested, and upon which the plaintiff's complaint necessarily relies." Parrino v. FHP, Inc., 146 F.3d 699, 706 (9th Cir. 1998), superseded by statute on other grounds as recognized in Abrego Abrego v. The Dow Chem. Co., 443 F.3d 676, 681 (9th Cir. 2006). The Ninth Circuit has explained that such reliance is permissible when "plaintiff's claim depends on the contents of a document" that is not attached to the complaint. Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir. 2005); see also Swartz v. KPMG LLP, 476 F.3d 756, 763 (9th Cir. 2007) (in order to prevent a plaintiff from prevailing on a Rule 12(b)(6) motion by omitting documents underlying a claim, court may consider the document if its authenticity is not questioned). In this case, one of the documents covered by defendants' request is a letter from David Grose, dated August 19, 2010, which is quoted in the complaint ECF No. 28-3 at 2-3 (Ex. A); the court may consider this as incorporated by the complaint.
A court also 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). Because the state court records have a "direct relation" to the issue of abstention, it is proper for this court to take judicial notice of them. Nevertheless, the court will not take judicial notice of any disputed facts in these records. Lee v. City of Los Angeles, 250 F.3d 668, 690 (9th Cir. 2001).
In addition, it is proper to take judicial notice of administrative rules and records of administrative agencies. Barron v. Reich, 13 F.3d 1370 (9th Cir. 1994) (handbook of Wage and Hour Division); Mack v. South Bay Beer Distributors, Inc., 798 F.2d 1279 (9th Cir. 1986), disapproved on other grounds by Astoria Federal Savings & Loan Ass'n v. Solimino, 501 U.S. 104 (1991) (administrative board decision); DCIPA, LLC v. Lucile Slater Packard Children's Hosp., F. Supp. 2d , 2011 WL 5141505, at *3 (D. Or. Oct. 20, 2011) (administrative rules); Jensen v. County of Sonoma, 2008 WL 5048203, at *3 (N.D. Cal. Nov. 25, 2008) (administrative decision and order). Accordingly, the court overrules plaintiffs' objections and takes judicial notice of Exhibits B through K comprising the SMAQMD rules and documents relating to the proceedings on the petition for abatement, as well as the decision of the California Court of Appeal (ECF No. 66-1), and a letter dated November 5, 2009, denying plaintiffs' permit applications, which is the remainder of Ex. A.
Defendants object to plaintiffs' submission of some excerpts from the SMAQMD hearing, the decision of the California Air Resources Board (CARB) regarding some of their engines, and information from the CARB website addressing the definition of a site. ECF No. 49, Exs. 3-6. The court agrees that the discussion during the hearing and an administrative decision and information from another agency are not relevant to plaintiffs' claims here. Moreover, to the extent these materials are judicially noticeable, plaintiffs appear to be asking the court to rely on disputed facts in these materials, which the court cannot do.
Defendants argue that this case should be dismissed because of the pendency of the state action. Plaintiffs counter that they have dismissed the claim for equitable relief. They note they are proceeding only on claims for damages arising out of defendants' classifying their mine as a single site, which has prevented plaintiffs from operating their portable engines, and Grose's issuance of a cease and desist letter that essentially prevents them from conducting any operations at the mine. Plaintiffs agree these claims should be stayed pending resolution of the state proceedings.
In Younger v. Harris, 401 U.S. 37, 54 (1971), the Supreme Court recognized the "longstanding public policy against federal court interference with state court proceedings . . ." and reversed the District Court's enjoining of a prosecution against Harris for violations of California's criminal syndicalism statutes. Subsequent cases applying Younger have formulated a three-part test: a federal court should abstain from adjudicating a lawsuit if (1) there are pending state judicial proceedings, (2) the state proceedings implicate important state interests, and (3) the state proceedings provide an adequate opportunity to raise federal questions. Middlesex County Ethics Comm. v. Garden State Bar Ass'n, 457 U.S. 423, 432 (1982). The Ninth Circuit has identified "a vital and indispensable fourth element: the policies behind the Younger doctrine must be implicated by the actions requested of the district court." Amerisourcebergen Corp. v. Roden, 495 F.3d 1143, 1149 (9th Cir. 2007). Accordingly, "once the three Middlesex elements are satisfied, the court does not automatically abstain, but abstains only if there is a Younger-based reason to abstain--i.e., if the court's action would enjoin, or have the practical effect of enjoining, ongoing state court proceedings." Id. After determining whether Younger abstention is appropriate, the court must consider whether to dismiss or stay the federal action; generally a case seeking damages only should be stayed. Gilberston v. Albright, 350 F.3d 1030 (9th Cir. 2003); see Deakins v. Monaghan, 484 U.S. 193 (1988) (declining to decide whether dismissal is appropriate "when (but only when) a necessary predicate of the claim for damages undermines a necessary element in the pending state proceeding").
Defendants argue that any resolution of plaintiffs' claims will have a direct, disruptive impact on the state proceedings because this court's determination of the constitutional issue underlying the damage claim would essentially enjoin the state action and so dismissal of the damages action is appropriate. As the Ninth Circuit has observed, "mere potential for conflicting results is not 'interference'" within the meaning of Younger. Id. at 1129. The court accepts plaintiffs' concession that a stay of the second claim in the amended complaint against SMAQMD and Grose is appropriate.*fn5
IV. State Defendants' Motion To Dismiss
A. Allegations In Amended Complaint
As part of the FAC, plaintiffs have dropped claims against the state, the named agencies and claims against defendant Goldstene.
In September 2008, defendant Gregory, an employee of the DFG, accompanied by defendant Simmons, an employee of the Army Corps of Engineers (Corps), entered plaintiffs' mine without a warrant and inspected a dam on the southernmost creek, the processing facility, and the creek on the north east side of the processing facility. ECF No. 42-1 ¶ 36.
Plaintiffs also allege that as part of Teichert's campaign to drive plaintiffs out of business, State Senator Dave Cox sent a letter to the Secretary of California's Resources Agency in October 2008, asking for a review of plaintiffs' mining operations and consideration whether plaintiffs should be removed from a list*fn6 of approved aggregate operators, eligible to sell to the state. ECF No. 42-1 ¶ 40.
Even though inspectors from the DFG determined there were no violations at plaintiffs' mine, defendants Koehler, O'Bryant and Norris, all employees of the OMR, continued to investigate. Id. ¶ 45. In October or November 2008, Morris told several contractors not to buy from plaintiffs and threatened suit if they did. Id. ¶¶ 46, 55.
In February 2009, Koehler completed an inspection report identifying several purported violations by plaintiffs of the Surface Mining and Reclamation Act (SMARA), including an inadequate financial assurance undertaking, and other statutes. Id. ¶ 48. In March 2009, O'Bryant sent a memo to the Natural Resources Agency, identifying these violations along with several others. Id. ¶ 49. As a result, O'Bryant wrote to plaintiffs summarizing these findings and informing plaintiffs they were being removed from the AB 3098 list. Id. ¶ 51. O'Bryant did not provide prior notice or inform plaintiffs of any avenue to challenge the removal. Id. Plaintiffs' counsel wrote to Testa, requesting an appeal of the removal, but Testa replied there was no appeal procedure. Id. ¶ 53.
Plaintiffs allege that defendants Koehler, Norris, Testa and O'Bryant have violated plaintiffs' right to due process and equal protection by enforcing a policy that denies plaintiffs notice and a right to appeal their removal from the AB 3098 list. They also allege defendants Koehler, Testa and O'Bryant have violated plaintiffs' right to procedural due process by removing plaintiffs' business from the AB 3098 list. Id. ¶¶ 105-106. In addition, defendant Norris has violated plaintiffs' right to substantive due process by instructing truckers not to buy minerals from the plaintiffs. ...