Mark Enterprises Car Company LLC v. Ali

• Court: District Court, D. Arizona
• Decided: April 22, 2025
• Docket: 2:21-cv-01681
• Status: Unknown

Opinion

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA

9 Mark Enterprises Car Company LLC, et al., No. CV-21-01681-PHX-DLR

10 Plaintiffs, ORDER

11 v.

12 Dilsher Ali, et al.,

13 Defendants. 14 15 16 Plaintiffs Mark Enterprises Car Company LLC, Mark Enterprises Car Company II 17 LLC, Mark Enterprises Car Company III LLC,1 Mark Dubowy, Dylan Mougel, and Joshua 18 Spencer (collectively, “Plaintiffs”) filed a 42 U.S.C. § 1983 action against Defendants 19 Special Investigator Dilsher Ali, Chief Special Agent Reginald Grigsby, Supervisor James 20 Cope, (collectively, “Defendants”) and three of their unnamed supervisors (“John Does 1– 21 3”).2 In their Second Amended Complaint (“SAC”), Plaintiffs allege several violations of 22 their Fourth Amendment rights. (Doc. 45.) Before the Court is Defendants’ motion for 23 summary judgment (Doc. 101). The motion is fully briefed. (Docs. 111, 116.) The Court 24 heard oral argument on March 28, 2025. For the following reasons, the Court grants the 25 motion. 26

27 1 The Court will hereinafter refer to the three Mark Enterprises entities collectively as “Mark Enterprises.” 28 2 The Court will hereinafter refer to Cope, Grigsby, and John Does 1–3 collectively as the “Supervisory Defendants.” 1 I. Background 2 a. Facts 3 Dubowy, Spencer, and Mougel own and operate three car dealerships (“Mark 4 dealerships”) in the state of Arizona, which buy and sell imported vehicles as part of their 5 inventory. (Doc. 111 at 2.) Around 2018, Plaintiffs began selling imported Ford trucks 6 bought at auction from TCB Importing (“TCB”) and Johnny Cooper. (Id. at 3.) Ford makes 7 two types of similar trucks: the “F-150” and the “Lobo.” (Doc. 111-1 at 4.) Ford 8 manufactures both trucks in Dearborn, Michigan but markets and sells the F-150 truck in 9 the United States, and markets and sells the Lobo to Mexican markets. (Id.) 10 Prior to the suit, Plaintiffs received complaints from customers, alleging various 11 problems with the vehicles after purchase. Specifically, Richard and Laurel Dunn 12 (collectively, the “Dunns”) wrote a letter to Mark Enterprises accusing the business of 13 fraud in January 2019. (Doc. 106-2 at 25–29.) In their letter, the Dunns state that Ford 14 would not honor their warranty because the vehicle came from Mexico—a fact 15 unbeknownst to the Dunns at the time of purchase. (Id. at 26.) In August 2019, Michael 16 Wilson also complained to Mark Enterprises because the “Ford F-150 Platinum 4x4” he 17 purchased was missing key features such as a “lane keep option,” “parallel park assist,” 18 and “Sirius Radio.” (Id. at 2–3.) Wilson believed these features should have been present 19 in the model he purchased and that Mark Enterprises sold him a different model that Ford 20 designated for the Mexican market. (Id.) Plaintiffs admit that their dealerships purchased 21 imported vehicles through auction with Vehicle Identification Numbers (“VIN”) 22 associated with the Mexican market. (Doc. 45 ¶ 19.) 23 Between 2015 and 2019, multiple federal agencies investigated Cooper and TCB 24 based on evidence of improper importation of vehicles from Mexico into the United States. 25 (Doc. 106-2 at 47–48.) The overlap between the investigation into Cooper and the Mark 26 dealerships started on March 19, 2019, when Detective Lan Le, with the Arizona 27 Department of Public Safety (“DPS”), entered one of the Mark dealerships while 28 investigating a separate matter. (Doc. 106-3 at 9–10.) Mougel himself asked Le to 1 investigate some of the Ford F-150s that Mark Enterprises recently bought at auction. (Id.) 2 Mougel voiced concern about the vehicles to Le because the vehicles had low mileage and 3 were purchased at a suspiciously low price. (Id.) Le ran the VIN of one of the Ford trucks 4 and found its VIN indicated that it was a Lobo and not an F-150. (Id. at 9.) Le later referred 5 the matter over to the Arizona Department of Transportation (“ADOT”) and the Arizona 6 Attorney General’s Office (“AGO”). (Id. at 10.) 7 Further investigation by ADOT confirmed that the vehicle was a Lobo and linked 8 the Lobo’s importation to TCB and Cooper. (Doc. 106-1 5–7.) ADOT coordinated with the 9 National Highway Traffic Safety Administration (“NHTSA”) to uncover background on 10 TCB’s alleged scheme to illegally import Lobos into the U.S. by using fraudulent labels 11 and “a network of dealers” to make vehicles appear compliant with U.S. standards. (Id. at 12 6.) In May 2019 and under advisement from the DPS and ADOT, AGO launched an 13 investigation to determine whether any vehicles imported by Cooper and TCB were sold 14 at the Mark dealerships. (Doc. 106-1 at 10.) 15 One month prior, the Department of Homeland Security Investigations (“HSI”) 16 opened its own investigation into TCB for its alleged importation scheme. (Doc. 106-2 at 17 40.) Investigators with HSI and AGO worked together as the respective lead federal and 18 state agencies along with assistance from Ford and Fiat Chrysler employees. (Doc. 106-3 19 at 12.) Ford informed AGO that seventeen of the vehicles in the Mark dealerships (“subject 20 vehicles”) had VINs associated with the Mexican market, (id. at 15), and Fiat Chrysler 21 confirmed that Mark Enterprises did not have the necessary emission certification labels 22 indicating those vehicles were compliant with U.S. emission standards. (Id. at 20.) 23 On September 30, 2019 and following these investigations, Ali submitted an 24 affidavit for a search warrant to the Maricopa County Superior Court, where a neutral judge 25 signed it. (Doc. 106-1 at 38, 47.) The affidavit contained information uncovered by the 26 state’s investigation, including prior consumer complaints, statements from Ford employee 27 Jason Kosofsky, statements from Fiat Chrysler employee Michael Lewis, and email 28 communications with HSI Investigators. (Doc. 101-2 at 21–28.) The judge found that the 1 affidavit established probable cause to search the dealerships based on the investigation 2 into Cooper, TCB, and associates, for violations of Arizona fraud and conspiracy laws. 3 (Doc. 106-1 at 13.) On October 1, 2019, Defendants executed the warrant on all three Mark 4 dealerships, seized fifteen vehicles and corresponding “deal jackets” associated with 5 vehicle sales, and downloaded data from cell phones and computers related to dealership’s 6 business. (Docs. 106-3 at 37; 111-1 at 63–65; 111-2 at 3–5, 110.) 7 b. Procedural Posture 8 Plaintiffs allege violations of their Fourth Amendment rights. Count I alleges 9 Defendants engaged in judicial deception by presenting a “false or misleading affidavit” to 10 a neutral magistrate to obtain a search warrant. (Doc. 45 at 29–32.) Count II alleges that 11 Cope and Grigsby violated Plaintiffs’ Fourth Amendment rights by failing to properly 12 supervise and control their subordinates. (Id. at 32–33.) Count III alleges that all 13 Defendants conducted an unreasonable search. (Id. at 33–35.) At oral argument, Plaintiffs 14 conceded that the officers acted within the scope of the warrant, but they maintain that the 15 warrant was too broad. 16 Defendants move for summary judgment on the grounds that (1) the affidavit 17 prepared by Ali did not contain any misrepresentations or omissions; (2) Defendants did 18 not act with intentional or reckless disregard for the truth; (3) the officers acted within the 19 scope of a valid search warrant; and (4) Defendants are entitled to qualified immunity. 20 (Doc. 101.) 21 II. Legal Standard 22 Summary judgment is appropriate if, viewing the facts in a light most favorable to 23 the nonmoving party, there is no genuine dispute as to any material fact, and the movant is 24 entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). Material facts are those facts 25 that would affect the outcome of the case, and a dispute is genuine if a reasonable jury 26 could find for the nonmoving party based on the competing evidence. Anderson v. Liberty 27 Lobby, Inc., 477 U.S. 242, 248 (1986). Summary judgment is also proper “against a party 28 who fails to make a showing sufficient to establish the existence of an element essential to 1 that party’s case, and on which that party will bear the burden of proof at trial.” Celotex 2 Corp. v. Catrett, 477 U.S. 317, 322 (1986). 3 The defendant bears the initial burden to show an absence of evidence to support an 4 essential element of the plaintiff’s case or an absence of a genuine dispute of material facts. 5 Id. at 323. Once the defendant has done so, the burden shifts to the plaintiff, who must “go 6 beyond the pleadings” and use the “kinds of evidentiary materials listed in Rule 56(c)” to 7 “designate specific facts showing that there is a genuine issue for trial.” Id. at 324; see also 8 Fed. R. Civ. P. 56. “Where the record taken as a whole could not lead a rational trier of fact 9 to find for the non-moving party, there is no ‘genuine issue for trial.’” Matsushita Elec. 10 Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986) (quoting First Nat’l Bank of 11 Ariz. v. Cities Serv. Co., 391 U.S. 253, 289 (1968)). 12 III. Analysis 13 Defendants argue that Plaintiffs have no evidence that they made any 14 misrepresentation or omission that could form the basis of a judicial deception claim. (Doc. 15 101 at 10.) Defendants also raise a qualified-immunity defense to Counts II and III. (Id. at 16 8–10.) 17 a. Count I—Judicial Deception 18 The Ninth Circuit recognizes a constitutional right to be free from judicial deception 19 in the issuance of a warrant. Whitaker v. Garcetti, 486 F.3d 572, 581 (9th Cir. 2007). Courts 20 “effectively intertwine the qualified immunity question” with a plaintiff’s judicial 21 deception claim. Butler v. Elle, 281 F.3d 1014, 1024 (9th Cir. 2002). Therefore, qualified 22 immunity does not serve as an independent bar to a plaintiff’s recovery in a judicial 23 deception claim because “no reasonable officer could believe that it is constitutional to act 24 dishonestly or recklessly with regard to the basis for probable cause in seeking a warrant.” 25 Id. 26 To survive summary judgment on a judicial deception claim, a plaintiff “must (1) 27 establish that the warrant affidavit contained misrepresentations or omissions material to 28 the finding of probable cause, and (2) make a substantial showing that the 1 misrepresentations or omissions were made intentionally or with reckless disregard for the 2 truth.” Bravo v. City of Santa Maria, 665 F.3d 1076, 1083 (9th Cir. 2011) (quotation marks 3 omitted). “‘Omissions or misstatements resulting from negligence or good faith mistakes 4 will not invalidate an affidavit which on its face establishes probable cause,’ and a claim 5 of judicial deception may not be based on an officer’s erroneous assumptions about the 6 evidence he has received.” Daschke v. Hartenstein, 420 F. Supp. 3d 919, 932 (D. Ariz. 7 2019) (quoting United States v. Smith, 588 F.2d 737, 739–40 (9th Cir. 1978)). 8 “If a party makes a substantial showing of deception, the court must determine the 9 materiality of the false statements or omissions.” Ewing v. City of Stockton, 588 F.3d 1218, 10 1224 (9th Cir. 2009) (citation omitted). An omission or misrepresentation is material where 11 “a court would have declined to issue the [warrant] had the defendant been truthful.” David 12 v. Kaulukukui, 38 F.4th 792, 801 (9th Cir. 2022) (quotation marks omitted). Because 13 Plaintiffs claim Ali made both misrepresentations and omissions in the affidavit, the Court 14 analyzes them each in turn. 15 i. Alleged Misrepresentations in the Affidavit 16 Plaintiffs identify eight statements from Ali’s affidavit that they assert are 17 misrepresentations:3 18 1. The Office of the Arizona Attorney General received numerous consumer complaints against Mark Mitsubishi and Mark Kia “over 19 the past couple of years,” including complaints of the unlawful sale of vehicles specifically manufactured for the Mexican market to 20 unwitting customers in the United States under false pretenses. 21 2. The subject vehicles were manufactured by Ford for the “Mexican market” and were imported illegally. 22 3. Ford Lobos and Ford F-150s are different vehicles and not visually 23 and functionally identical in every material respect. 24 4. Ford trucks intended for sale in the Mexican market and subsequently imported to the United States do not meet U.S. safety and emissions 25 standards. 26 5. Ford Lobos and Ford F-150s are not covered by identical warranties. 27 3 The Court will refer to each statement in the order listed followed by the number 28 listed. For example, the Court will refer to the first statement about “numerous consumer complaints,” as Statement 1. 1 6. The manufacturer or certification labels in the subject vehicles’ door jams were counterfeit or had been illegally modified or replaced with 2 fictitious English labels. 3 7. Ford Lobos sold by Plaintiffs were illegally relabeled and re-badged as Ford F-150 Platinums or King Ranches. 4 8. The Dunns’ and Wilson’s vehicles were not covered by warranties; 5 were equipped differently because they were initially intended for sale in Mexico; and any dispute with the Dunns or with Wilson was not 6 completely resolved to the satisfaction of the customer. 7 (Doc. 45 ¶ 90.) 8 Statement 1. Plaintiffs maintain that Statement 1 constitutes a misrepresentation 9 because Ali “only knew of one complaint regarding an odometer”; Mark Enterprises did 10 not know of Wilson’s complaint; and Mark Enterprises had a low complaint-to-sale ratio. 11 (Doc. 111 at 10.) There is no evidence that Statement 1 was a misrepresentation of a 12 material fact. The affidavit references the Dunns’ and Wilson’s complaints (Doc. 101 at 13 22–26), and their existence is supported by evidence in the record. (Doc. 101-2 at 5–6, 26– 14 27.) Plaintiffs’ argument actually contradicts their claim by conceding Ali knew of another 15 complaint in addition to those made by the Dunns and the Wilsons—one relating to an 16 odometer. 17 At oral argument, Plaintiffs argued that the use of the word “numerous” is a 18 misrepresentation since the affidavit refers to two complaints and “numerous” usually 19 refers to more than two. However, Plaintiffs conceded at oral argument that even if this 20 amounted to a misrepresentation, it would not be material to a finding of judicial deception. 21 Statement 2. Plaintiffs argue that Statement 2 is a misrepresentation because: “the 22 Fords Cooper sold to Mark Enterprises were imported according to mandated federal 23 procedures”; “Customs and Border Patrol received and approved import documentation”; 24 and Mark Enterprises “reasonably relied” on paperwork submitted by Cooper and 25 “inspected and approved by federal and state agencies.” (Doc. 111 at 11.) In a supplemental 26 brief following oral argument, Plaintiffs cited to five exhibits to support its arguments.4 27 (Doc. 121.) Plaintiffs point to deposition testimony from Spencer that establishes he met

28 4 At oral argument, the Court asked Plaintiffs to provide citations to the previous argument in the record since none could be found in its original response brief. (Doc. 111.) 1 with Cooper in 2019, and Cooper “showed [him] documents” that Cooper had good 2 standing as an importer. (Doc. 111-1 at 36.) 3 Plaintiffs’ proffered evidence is not evidence of a misrepresentation of a material 4 fact. The evidence focuses not on whether Ali lied but on whether Plaintiffs properly relied 5 on Cooper for his importing services. In fact, Spencer noted that Cooper’s “packet of 6 documents” only related to Cooper’s status as an importer and not the vehicles themselves. 7 (Id. at 37.) Plaintiffs also cite to deposition testimony from Mougel stating that Cooper 8 “had a large file of [import] paperwork,” but “[he] didn’t go through it.” (Id. at 51.) 9 Plaintiffs evidence might be relevant to dispute potential criminal liability, but it does not 10 show that Ali misrepresented that the vehicles were imported illegally. 11 Moreover, there was a factual basis for Statement 2. During the investigation, Ali 12 interviewed Neil Thurgood, a safety compliance analyst for United States Department of 13 Transportation. (Docs. 101-2 at 19; 106-2 at 31.) When drafting the affidavit, Ali relied on 14 Thurgood to establish that Mark Enterprises did not follow proper procedures for vehicle 15 importation. (Doc. 101-2 at 19.) Ali then included information from the interview in the 16 affidavit, presenting Thurgood’s qualifications to the magistrate and making it clear to the 17 magistrate what portions of the affidavit were based on Thurgood’s opinion. (Id.) 18 Plaintiffs’ reliance on Ali’s deposition testimony and an expert report from Coleman 19 Sachs similarly does not create a genuine dispute of fact. In Ali’s deposition, he testified 20 that he “briefly went through” the build sheets of the subject vehicles, but he did not have 21 expertise in “diagnosing . . . safety differences.” (Doc. 111-1 at 129.) This testimony does 22 not support any of Plaintiffs’ arguments that Ali misrepresented information in Statement 23 2. Instead, the affidavit clearly states that Ali based Statement 2 on his interview with 24 Thurgood and not his own knowledge or expertise. (Doc. 101-2 at 19.) Sachs’s report gives 25 an overview of the VIN system, importation requirements, and his qualifications as an 26 expert. (Doc. 111-2 at 44–45.) Sachs does not opine as to whether the subject vehicles were 27 illegally imported, so his testimony cannot serve to create a genuine dispute about the 28 veracity of Statement 2. Statement 2 was not a misrepresentation. 1 Statement 3. Plaintiffs assert that Ali misrepresented the difference between the 2 Ford F-150 and the Lobo, both visually and functionally, because Ford F-150s and Lobos 3 “are all manufactured identically in Dearborn, Michigan.” (Doc. 111 at 11.) There is no 4 statement in the affidavit about the visual similarities of the two trucks (Doc. 101-2 at 13– 5 28), and thus, there cannot be any misrepresentation on that point. The Court addresses 6 alleged misrepresentations about functional differences between the vehicles in the 7 Statement 7 section. 8 Statement 4. Plaintiffs assert that Statement 4 is a misrepresentation because in 9 Cope’s deposition, he testified that he believed all the subject vehicles would pass Arizona 10 emission standards tests because one of the vehicles tested passed. (Doc. 111-1 at 105–06.) 11 But Cope’s deposition only speaks to Arizona’s emissions standards, not U.S. standards, 12 which Cope notes in his testimony. (Id.) And, even assuming the testimony supports 13 Plaintiffs’ point, the inquiry is not whether the subject vehicles could pass emissions tests 14 but whether Ali misrepresented facts in his affidavit. 15 To support Statement 4, Ali listed his sources and summarized each communication 16 in the affidavit, including: his interview with Thurgood; an email from Kosofsky 17 confirming that Ford sold the subject vehicles to dealers in Mexico; email correspondence 18 from Michael Lewis, Security Operations at Fiat Chrysler Automobiles, confirming the 19 vehicles were intended for the Mexican market based on their VINs; and a report from 20 HSI’s investigation confirming that Lobos meet Mexico’s emissions and safety standards, 21 which differ from U.S. standards. (Doc. 106-3 at 21; Doc. 106-3 at 12–13, 15–16, 20.) 22 Plaintiffs do not counter with any evidence that the subject vehicles were not intended for 23 the Mexican market or that the subject vehicles met U.S. safety and emissions standards. 24 (Doc. 111 at 11.) Statement 4 is not a misrepresentation. 25 Statement 5. Plaintiffs assert that Statement 5 is a misrepresentation because “Ford 26 dealerships honored U.S. warranties and performed warranty work” on the subject 27 vehicles.5 (Doc. 111 at 12.) The affidavit only mentions warranties to the extent it talks

28 5 Plaintiffs do not point to any evidence in the record supporting this assertion; they merely state that “Mark Enterprises confirmed this after extensive due diligence.” (Doc. 1 about the complaints made by Wilson and the Dunns. (Doc. 101-2 at 13, 25–26.) Ali makes 2 no statement in the affidavit that “Cooper’s Fords sold by Mark Enterprises were not 3 covered by warranties,” (Doc. 111 at 12); instead, the affidavit presents findings from Ali’s 4 investigation into Wilson’s complaint and includes lines pulled verbatim from the Dunns’ 5 complaint. (Id.) And, in any event, there is evidence in the record that would support an 6 assertion that some Ford dealerships would not honor the subject vehicles’ warranties. (See, 7 e.g., Doc. 106-3 at 42.) 8 Statement 6. Plaintiffs argue that Statement 6 was a misrepresentation because Ali 9 cannot establish that Plaintiffs “knew about or participated in the replacement of” the 10 vehicles’ certification/manufacturer labels. (Id.) But the affidavit does not state whether 11 Plaintiffs knew of or participated in the replacement of any labels, only that “it appeared 12 someone had removed the original manufacturer labels and replaced them [illegally].” 13 (Doc. 101-2 at 21.) The affidavit lists and summarizes the opinions of Mortensen, 14 Kosofsky, and Thurgood. (Id.) Their opinions indicate that the subject vehicles, which were 15 supposedly legally imported from Mexico, had English labels instead of Spanish labels 16 with additional certification labels affixed to them—indicating potential fraud. (Id.) 17 Statement 6 was not a misrepresentation. 18 Statement 7. Plaintiffs do not advance any argument in support of their allegation 19 that Statement 7 is a misrepresentation. On the other hand, Defendants support Statement 20 7 with information Wilson provided in an interview with Ali. (Doc. 101 at 13.) In that 21 interview, Wilson confirms he purchased a vehicle from Plaintiffs with the understanding 22 “it was the ‘Platinum’ trim model,” but the Platinum trim model would have come 23 equipped with amenities not included in the vehicle he purchased from Mark Enterprises. 24 (Doc. 106-2 at 2–3.) And HSI’s investigation revealed other Platinum trim features missing 25 from Wilson’s vehicle. (Id.) Statement 7 is not a misrepresentation. 26 Statement 8. Plaintiffs argue that Statement 8 is a misrepresentation because they 27 resolved the complaints mentioned in the affidavit. But the affidavit does not represent that 28 111 at 12.) 1 Mark Enterprises failed to resolve complaints. It merely states that complaints were made.6 2 (See Doc 101-2 at 13–28.) The affidavit only mentions warranties and the vehicles’ 3 equipment to the extent that Wilson’s and the Dunns’ complaints mention them, as 4 addressed earlier. (Id. at 22–28, 35–37.) 5 Plaintiffs fail to show that the affidavit includes any misrepresentations. 6 ii. Alleged Omission from the Affidavit 7 Plaintiffs argue Defendants committed judicial deception by failing to include 8 information which “could have been acquired prior to the completion and submission” of 9 the affidavit. (Doc. 45 ¶ 42.) Specifically, Plaintiffs assert that Defendants omitted 10 information related to Ford’s Online Automotive Service Information System (“OASIS”) 11 software, “which provides a ‘build sheet’ describing the truck’s manufacturing 12 information; warranty status; and components, including safety and emissions equipment” 13 and which was accessible easily with a vehicle’s VIN number. (Doc. 111 at 6; accord. Doc. 14 45 ¶ 42.) Plaintiffs argue the inclusion of the OASIS information would have established 15 that the subject vehicles had a valid warranty and inclusion of information from the build 16 sheets would have established that Ford built them in Dearborn, Michigan. (Doc. 45.) 17 Defendants respond that the omission of the OASIS information and build sheets 18 was immaterial to the probable cause finding. The Court agrees. “The government need 19 not include all of the information in its possession to obtain a search warrant. . . . The 20 omission of facts rises to the level of misrepresentation only if the omitted facts ‘cast doubt 21 on the existence of probable cause.’” United States v. Johns, 948 F.2d 599, 606–07 (9th 22 Cir. 1991) (quoting United States v. Dennis, 625 F.2d 782, 791 (8th Cir. 1980)). 23 To establish a material omission, Plaintiffs must prove that the judge “would have 24 declined to issue the [warrant]” without the alleged omissions. David, 38 F.4th at 801. 25 Thus, the Court determines materiality by examining “whether the affidavit, once corrected 26 and supplemented [with the omitted information], establishes probable cause.” Ewing¸ 588 27 F.3d at 1224. Here, even if Ali had included facts related to OASIS and the build sheets, a

28 6 Even if the complaints were resolved, this omission would not be material to the probable cause finding. See supra Section III.a.ii. 1 magistrate still could have found probable cause to issue the warrant based on information 2 from Mortensen, Thurgood, and Kosofsky. The additional facts Plaintiffs offer do not 3 undermine the probable cause finding. 4 Plaintiffs fail to show a triable issue of fact that Defendants made any material 5 misrepresentations or omissions in the affidavit. Defendants are entitled to summary 6 judgment for Count I. 7 b. Count III—Unreasonable Search 8 As Count III, the SAC alleges that Defendants engaged in an unreasonable search 9 in violation of the Fourth Amendment. (Doc. 45 at 33.) At oral argument, Plaintiffs 10 clarified that they do not allege Defendants acted outside the scope of the warrant issued. 11 Instead, Plaintiffs argue that, though the search fell within the scope of the warrant, the 12 warrant issued was nevertheless too broad. Defendants raise a qualified immunity defense. 13 Plaintiffs respond that Defendants are not entitled to qualified immunity because “it [was] 14 obvious that no reasonably competent officer would have concluded that a warrant should 15 issue.” Messerschmidt v. Millender, 565 U.S. 535, 547 (2012). The Court disagrees. 16 Government officials enjoy qualified immunity from civil damages unless their 17 conduct violates “clearly established statutory or constitutional rights of which a reasonable 18 person would have known.” Harlow v. Fitzgerald, 457 U.S. 800, 818 (1982). The 19 qualified-immunity doctrine “gives government officials breathing room to make 20 reasonable but mistaken judgments about open legal questions,” and it protects “all but the 21 plainly incompetent or those who knowingly violate the law.” Ashcroft v. al-Kidd, 563 U.S. 22 731, 743 (2011) (internal quotation omitted). 23 The Supreme Court in Messerschmidt held that “[w]here the alleged Fourth 24 Amendment violation involves a search or seizure pursuant to a warrant, the fact that a 25 neutral magistrate has issued a warrant is the clearest indication that the officers acted in 26 an objectively reasonable manner or . . . in ‘objective good faith.’” 565 U.S. at 546 (internal 27 quotation marks omitted). A narrow exception to the rule exists where “it is obvious that 28 no reasonably competent officer would have concluded that a warrant should issue.” Id. at 1 547. The “threshold for establishing this exception is a high one.” Id. If the exception is 2 met, the officers are not entitled to qualified immunity. Id. 3 Plaintiffs argue that Defendants lost the “shield of immunity” afforded by executing 4 the search within the scope of the warrant because the affidavit supporting the warrant was 5 “so lacking in the indicia of probable cause” and so overbroad “that no reasonably 6 competent officer would have” executed it. (Doc. 111 at 15–16.) First, Plaintiffs state that, 7 because the affidavit does not include a statement regarding Plaintiffs’ personal knowledge 8 or involvement in the counterfeiting or relabeling of the vehicles, the warrant lacked a 9 “nexus” between the activities alleged and the items to be searched. (Id.) 10 But Ali did not need to show Plaintiffs’ personal knowledge or involvement of the 11 labeling in his affidavit to have a sufficient nexus; he only needed to show that “the 12 evidence sought [at the dealership] will aid in a particular apprehension or conviction for 13 a particular offense.” Dalia v. United States, 441 U.S. 238, 255 (1979) (quoting Warden v. 14 Hayden, 387 U.S. 294, 307 (1967)). Ali did not state that any specific person relabeled the 15 vehicle, only that the practice of relabeling vehicles appeared to be inconsistent with 16 applicable U.S. law, indicating fraud under Arizona law. (Doc. 101-2 at 10–12.) Ali 17 indicated, in his affidavit, where and what items he had probable cause to believe could 18 assist in a future conviction. (Id. at 14–16.) Plaintiffs have not presented any evidence 19 indicating that Ali acted unreasonably by stating that the vehicles did not have correct 20 labeling under U.S. importation law or that he had probable cause to believe fraud had 21 occurred. 22 Plaintiffs further argue that “no reasonable magistrate could have concluded that 23 [Plaintiffs’] personal and business devices would hold evidence of illegal activity.” (Doc. 24 111 at 15–16.) Plaintiffs state that the magistrate wrote the warrant too broadly to include 25 “electronic devices and data.” (Id.) Plaintiffs’ argument rests on the theory that, not only 26 did a neutral magistrate issue a warrant too broad in violation of the Fourth Amendment 27 but that Defendants, not formally trained in the law, should have realized this and refused 28 to execute the warrant. (Doc. 111 at 16.) This argument fails. 1 Messerschmidt sets an exceedingly high hurdle for Plaintiffs to jump to show that 2 an officer should have known no warrant should issue. In Messerschmidt, the defendants 3 executed a warrant, allowing them “to search for and seize all firearms” inside the 4 plaintiff’s home. Id. at 548. The plaintiffs argued that no reasonable officer could have 5 concluded that probable cause existed to search for all guns in the home when the 6 underlying crime was committed using a single “black sawed off shotgun with a pistol 7 grip.” Id. (quotation marks omitted). The plaintiffs asserted that any reasonable officer 8 should have known that the warrant issued was unconstitutionally broad and unsupported 9 by the affidavit. Id. The Court disagreed and held that, even assuming the warrant was 10 overbroad, the defendant acted reasonably when executing the warrant because a 11 reasonable officer could conclude that the plaintiffs owned additional illegal guns based on 12 the plaintiffs’ membership in a gang and “willingness to use the gun to kill someone.” Id. 13 Additionally, a reasonable officer could conclude that “seizure of the firearms was 14 necessary to prevent further [crimes].” Id. 15 Applying Messerschmidt here, Defendants are entitled to qualified immunity. Even 16 assuming the warrant issued was too broad, Defendants did not act unreasonably by 17 searching and seizing electronic data used by employees and located at the dealerships in 18 warrant. Like the defendant in Messerschmidt, Ali could reasonably conclude that 19 information related to violations of Arizona’s fraud and conspiracy laws, such as 20 communications discussing the importation of vehicles or evidence mentioning the 21 counterfeit labeling of Lobos, could be found on digital devices listed in the search warrant. 22 Ali and officers executing the warrant could have also based the scope of the warrant on 23 their extensive experience in gathering evidence in previous investigations and reasonably 24 concluded that the scope was permissible. (See Doc. 101-2 at 16–17.) Lastly, it was not 25 unreasonable for Defendants to conclude that they needed to collect a wide range of 26 electronic data and devices to support “a broad investigation of TCB Importing and Johnny 27 Cooper.” (Doc. 101 at 4.) In any event, Defendants did not act “plainly incompetent[ly]” 28 in executing the warrant—which is the level of conduct required to overcome the shield of qualified immunity. Malley v. Briggs, 475 U.S. 335, 341 (1986). 2 Defendants are entitled to qualified immunity for the search. The Court grants 3 || Defendants summary judgment on Count III. 4 c. Count II—Supervisory Liability 5 Count II of the SAC alleges that the Supervisory Defendants share liability for the 6 || alleged Fourth Amendment violations in the issuance and execution of the warrant. (Doc. 7\| 45 at 32.) To establish supervisory liability in a § 1983 action, a plaintiff must first show 8 || “the supervisor’s subordinates violated the constitution.” Serna v. Colorado Dep’t of Corrections, 455 F.3d 1146, 1151 (9th Cir. 2006). Second, the plaintiff must establish that 10 || each individual defendant either “participated in or directed the violations or knew of the 11 || violations of subordinates and failed to act to prevent them.” Puente v. City of Phoenix, 12}, 123 F.4th 1035, 1064 (9th Cir. 2024) (quotation marks omitted). Because Plaintiffs’ 13} supervisory liability claim relies on the underlying Fourth Amendment violations in the other Counts and those Counts fail, the Supervisory Defendants are entitled to summary 15 || judgment on Count II. 16 IV. Conclusion 17 Plaintiffs fail to show any misrepresentation or omission to form the basis of Count I, and Defendants are entitled to qualified immunity for Count III. Because neither of those claims stand, Count II fails as well. Accordingly, the Court grants Defendants summary 20 || judgment on all claims. 21 IT IS ORDERED that Defendants’ motion for summary judgment (Doc. 101) is 22 || GRANTED. The Clerk is directed to deny any remaining motions as moot, enter judgment 23 || accordingly, and terminate the case. 24 Dated this 21st day of April, 2025. 25 26 {Z, 27 {UO 28 Sone United Viste: District Judge

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