Butler v. Elle

281 F.3d 1014, 2002 WL 271483
Court of Appeals for the Ninth Circuit·Decided February 26, 2002·No. No. 99-35393·Published·Cited by 149 cases

Opinions

Per Curiam Opinion; Partial Concurrence and Partial Dissent by Judge LAY.

PER CURIAM.

This is an appeal from an entry of summary judgment by the United States District Court for the District of Idaho in favor of seven local government officials against whom an Idaho businessman brought charges under the United States and Idaho Constitutions, 42 U.S.C. §§ 1983, 1985(3), and various Idaho statutes. We affirm in part and reverse in part.

I. Background

Butler Trailer Manufacturing Company, Inc. (“Butler Trailer”) is a North Carolina corporation which operates manufacturing plants in North Carolina and Idaho. Cornelius “Neil” Butler, Jr. (“Butler”) lives in Franklin County, Idaho, and manages Butler Trailer’s plant there. This case arises from an October 3, 1996 search of Butler’s home and Butler Trailer’s plant in Franklin County.

At the time of the facts that gave rise to this case, Butler was a vocal critic of what [1019] he called police and governmental corruption in Franklin County. To that end, he had collected evidence and written articles alleging abuse of power by various government officials. Butler now claims that seven of these individuals used the power of their offices to retaliate against him by pursuing a meritless criminal investigation and prosecution of him for evading state sales and use taxes.

A. Facts

On September 11, 1996, Eric Elle, a Motor Vehicles Investigator with the Idaho Department of Transportation,1 observed Butler driving a pick-up truck with North Carolina manufacturer’s license plates. Elle believed the plates to be invalid in Idaho. After conducting additional research, Elle came to believe that Butler and Butler Trailer failed to pay required title and ton-mile taxes on their vehicles. Elle contacted Franklin County Prosecutor, Jay McKenzie, to ask that an inter-agency task force be formed to further investigate the matter. McKenzie later helped Elle prepare an affidavit in support of an application for a search warrant of Butler’s home and business.

Based on Elle’s affidavit, a Franklin County Magistrate issued the warrant, and on October 3, 1996, police searched Butler’s property. Although the warrant was obtained by Elle, the search team included members of the Idaho State Police and Franklin County Sheriffs Departments, as well as representatives from other state agencies and the FBI. During the search, officials seized more than one thousand items, including records and papers, trip envelopes containing cash, and North Carolina manufacturer license plates.

After the search, Prosecutor McKenzie filed state criminal charges against Butler and Butler Trailer. In that prosecution, Butler moved to suppress the use of any evidence obtained in the search on grounds that the search was unlawful. Butler also initiated a separate proceeding under Idaho Rule of Criminal Procedure 41(e),2 demanding the return of all property seized during the search. McKenzie stipulated that the evidence obtained in the search would not be used in that or any other criminal prosecution of Butler. Despite McKenzie’s stipulation, the state district court, in a Memorandum Decision on Butler’s Rule 41(e) motion, found that the search warrant was legally issued based upon probable cause. At the conclusion of the prosecution’s case, the state court issued a judgment of acquittal in favor of Butler.

The Idaho Court of Appeals later overturned the lower court’s favorable-to the-State’s finding of probable cause on the ground that McKenzie’s stipulation mooted the issue. See In re Butler Trailer Mfg., 132 Idaho 687, 978 P.2d 247, 250 (App. 1999). This ruling post-dated the district court’s judgment in this matter, and the district court was therefore deprived of the development in making its decision.

In February 1998, Butler and Butler Trailer brought suit against seven local and state government officials in the United States District Court for the District of Idaho, alleging various federal and state claims arising out of the search and seizure of his property and the state criminal [1020] action that followed.3 The heart of the charges was that these officials used the power of their respective offices to punish and silence Butler. Specifically, the complaint alleged that Motor Vehicles Investigator Elle made affirmative misrepresentations in his affidavit to obtain the search warrant for Butler’s property. In addition, Butler claimed that in instigating and executing the search, Elle unlawfully subverted the state tax code’s notice and assessment procedures. Butler also complained that Prosecutor McKenzie violated the same tax code provisions by advising Elle to obtain a warrant and conduct a search for evidence of Butler’s supposed tax evasion. The complaint further alleged that McKenzie’s prosecution of Butler was malicious in contravention of Idaho law.

Claims against Preston City Chief of Police Chief Scott Shaw and Officers Mark Beckstead and Ned Burton were based on their involvement in what Butler alleged was an illegal search. The complaint implicated Sheriff Don Beckstead4 for using the power of his office to trigger the allegedly wrongful investigation and prosecution of Butler. Sheriff Beckstead, along with Preston City Mayor Jay Heusser, were dually named in the complaint for slandering Butler by publicly stating that the investigation into his affairs was for drug trafficking.

Finally, the complaint alleged that all of the defendants conspired to deprive Butler of his constitutional rights. The district court entered summary judgment against Butler and Butler Trailer on all claims.

The district court concluded that the lawfulness of the warrant and the search was res judicata because of the state trial court’s finding that the warrant was properly issued based on probable cause and that the officers did not exceed the scope of the warrant or fail to return seized items. However, after the district court issued its order in this case, the Idaho Court of Appeals, as noted earlier, overturned the state trial court findings. The appeals court determined that because McKenzie stipulated in the state case that the evidence obtained in the search would not be used in a criminal prosecution of Butler, the validity of the warrant and search was moot. Because the appeals court has determined that the question is moot, preclusive effect cannot be given to the trial court’s finding with respect to the warrant and the search. See Ornellas v. Oakley, 618 F.2d 1351, 1356 (9th Cir.1980) (“A reversed or dismissed judgment cannot serve as the basis for a disposition on the ground of res judicata or collateral estoppel.”).

[1021] B. Standard of Review

This court reviews a district court’s entry of summary judgment de novo. See Boston Mut. Ins. v. Murphree, 242 F.3d 899, 902 (9th Cir.2001).

II. Federal and State Constitutional Claims

A. Background

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Butler v. Elle, 281 F.3d 1014, 2002 WL 271483 (9th Cir. 2002).

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