Railroad 1900, LLC v. City of Sacramento

Opinion

----oo0oo---- RAILROAD 1900, LLC, a Delaware No. 2:21-cv-01673-WBS-DB limited liability company, Plaintiff, ORDER RE: MOTION TO DISMISS v. CITY OF SACRAMENTO, a municipal entity, Defendant. ----oo0oo---- This action brought under 42 U.S.C. § 1983 challenges the City of Sacramento’s alleged failure to enforce anti-camping and other ordinances against homeless individuals in the area surrounding plaintiff’s property. (Compl. (Docket No. 1).) Plaintiff brings federal claims alleging violation of due process (count one), violation of equal protection (count two), state- created danger (count three), uncompensated taking (count four), and municipal liability (count five), in addition to five causes of action under California law. (Id.)1 I. Due Process Claim “Article III of the [United States] Constitution confines the federal courts to adjudicating actual ‘cases’ and ‘controversies.’” Allen v. Wright, 468 U.S. 737, 750 (1984), abrogated on other grounds, Lexmark Int’l, Inc. v. Static Control Components, Inc., 572 U.S. 118, 128 (2014). “The Art. III doctrine that requires a litigant to have ‘standing’ to invoke the power of a federal court is perhaps the most important” aspect of the case-or-controversy limitation. Id. “In essence the question of standing is whether the litigant is entitled to have the court decide the merits of the dispute or of particular issues.” Id. at 750-51 (quoting Warth v. Seldin, 422 U.S. 490, 498 (1975)).2 Pursuant to the standing requirement, the Supreme Court “has repeatedly held that an asserted right to have the Government act in accordance with law is not sufficient, standing alone, to confer jurisdiction on a federal court.” Allen, 468 1 At oral argument, counsel for plaintiff stated that plaintiff had agreed to dismiss its fourth and tenth causes of action -- alleging an unlawful taking under the Fifth Amendment and inverse condemnation under the California Constitution, respectively -- because it had determined that those claims lack merit. Thus, counsel stated, plaintiff no longer intends to prosecute them. Accordingly, the court will grant defendant’s motion to dismiss those claims. 2 Although the question of standing is not expressly raised in the City’s motion to dismiss, standing is essential to the existence of subject matter jurisdiction, an issue which may be raised sua sponte. Fed. R. Civ. P. 12(h)(3) (“If the court determines at any time that it lacks subject-matter jurisdiction, the court must dismiss the action.”); Snell v. Cleveland, Inc., 316 F.3d 822, 826 (9th Cir. 2002). U.S. at 754 (citing Schlesinger v. Reservists Comm. to Stop the War, 418 U.S. 208 (1974); Valley Forge Christian Coll. v. Ams. United for Separation of Church and State, Inc., 454 U.S. 464 (1982)). This follows from the fact that, as the Supreme Court has consistently held, “a private citizen lacks a judicially cognizable interest in the prosecution or nonprosecution of another.” Linda R.S. v. Richard D., 410 U.S. 614, 619 (1973) (citing Younger v. Harris, 401 U.S. 37, 42 (1971); Bailey v. Patterson, 369 U.S. 31, 33 (1962); Poe v. Ullman, 367 U.S. 497, 501 (1961)); see Lefebure v. D’Aquilla, 15 F.4th 650, 654 (5th Cir. 2021) (“It is a bedrock principle of our system of government that the decision to prosecute is made, not by judges or crime victims, but by officials in the executive branch. And so it is not the province of the judiciary to dictate to executive branch officials who shall be subject to investigation or prosecution.”) (citing Linda R.S., 410 U.S. at 617, 619; United States v. Nixon, 418 U.S. 683, 693 (1974)). This principle extends not only to criminal prosecution, but to civil enforcement as well. Doe ex rel. Doe v. Darien Bd. of Educ., 3:11-cv-1581 (JBA), 2012 WL 4092662, at *3 (D. Conn. Sept. 17, 2012); Gutierrez v. City of Carson, LA 10- cv-7627 JAK (CWx), 2011 WL 7129239, at *7 (C.D. Cal. Dec. 16, 2011); see, e.g., Allen, 468 U.S. at 739-40 (parents lacked standing to sue IRS for failure to “adopt[ ] sufficient standards and procedures to fulfill its obligation to deny tax-exempt status to racially discriminatory private schools”); In re Att’y Disciplinary Appeal, 650 F.3d 202, 203-04 (2d Cir. 2011) (client lacked standing to challenge decision not to discipline client’s former attorney) (citing Linda R.S., 410 U.S. at 619); White v. City of Toledo, 217 F. Supp. 2d 838, 840 (N.D. Ohio 2002) (“The law is well established that a city’s alleged failure, even if intentional, to enforce [a] speed limit does not state a § 1983 [claim] against a municipality.”) (citation omitted). § 1983 plaintiffs therefore “lack standing to seek judicial review of . . . executive decisions” not to enforce laws against other individuals. Lefebure, 15 F.4th at 655; see id. (collecting cases); Allen, 468 U.S. at 754. Because this is precisely what plaintiff seeks to do through this action, it lacks Article III standing to pursue its constitutional claims. Plaintiff alleges it has been injured by the development of homeless encampments near its property and by the conduct of individuals living there. (Compl. at ¶¶ 15-21.) However, the specific conduct by the City that plaintiff challenges is the City’s “fail[ure] and refus[al] to enforce [state and local] laws” and to “clear the homeless out of this de facto containment zone.” (Id. at ¶ 16.) Stated more directly, plaintiff challenges the City’s failure to enforce its laws against homeless individuals living near plaintiff’s property, and apparently seeks an injunction compelling the City to do so. (See Opp. at 1 (plaintiff challenges “Defendant’s refusal to enforce its own laws and those of the state that prohibit homeless persons from loitering, vandalizing, and otherwise inhabiting and destroying Plaintiff’s private property and the surrounding public property”) (Docket No. 17); Compl., Prayer (seeking “[i]njunctive/equitable relief in a manner to be determined by law”).) As explained, however, plaintiff lacks standing to sue the City for failing to enforce the law against others because it has no judicially cognizable interest in such enforcement. See Allen, 468 U.S. at 754; Linda R.S., 410 U.S. at 619; Att’y Disciplinary Appeal, 650 F.3d at 203-04. Plaintiff relies heavily upon the district court’s decision in Hunters Capital LLC v. City of Seattle, 499 F. Supp. 3d 888 (W.D. Wash. 2020). The plaintiffs in that case, a group of business and property owners, brought civil rights claims against the city challenging its allowance of and support for the “Capitol Hill Occupying Protest” (“CHOP”), a barricaded area encompassing the plaintiffs’ properties in which the City of Seattle did not enforce local or state laws against occupying protestors. See id. at 893-99. While the court declined to dismiss most of the plaintiffs’ constitutional claims, including multiple claims alleging violation of due process, it did not address the issue of standing. See id. at 899-906. Moreover, the plaintiffs’ claims in Hunters Capital were based not only on the city’s alleged non-enforcement of the laws, but also on the city’s substantial, affirmative provision of material support to the occupying protestors in establishing the so-called “Autonomous Zone.” Id. at 893. In particular, the city “allegedly provided CHOP participants with medical equipment, washing/sanitation facilities, portable toilets, nighttime lighting, and other material support” and “fortified . . . CHOP by providing participants with sturdier concrete barriers” with which to block people and vehicles from entering. Id. at 894-95 (internal quotation marks omitted). The mayor also “allegedly issued a statement indicating that the City . . . had no plans to cease supporting CHOP and that the City was instead acting to work with and preserve CHOP.” Id. at 896 (internal quotation marks omitted). The court relied on these allegations in concluding that the plaintiffs had “plausibly allege[d] . . . that the City’s affirmative actions in support of CHOP” caused a deprivation of the plaintiffs’ constitutionally protected property interests and thus sufficiently alleged a violation of due process. See id. at 900-01. In contrast, plaintiff in the present case does not allege that the City engaged in any affirmative conduct to support the development of the homeless encampments beyond the alleged non-enforcement decision itself. (See Compl. at ¶¶ 14- 25)3; White v. City of Minneapolis, 21-cv-371 (WMW/KMM), 2021 WL 5964554, at *1-2 & n.1 (D. Minn. Dec. 16, 2021) (distinguishing Hunters Capital, in due process § 1983 action challenging city’s failure to provide police protection during protest, leading to burning of plaintiff’s business, on ground that plaintiffs did not allege city “actively supported any third-party agitators[,] whether by providing resources . . . or by issuing public statements in which they expressed a desire to preserve the unrest”). This alone is insufficient to demonstrate a judicially cognizable interest, which is necessary to confer standing upon plaintiff. See Allen, 468 U.S. at 750-51, 754; Linda R.S., 410 U.S. at 619; Lefebure, 15 F.4th at 655. II. State-Created Danger Claim Plaintiff also brings a separate claim alleging state- 3 Indeed, plaintiff acknowledges that the City cleared the area on at least one occasion. (Id. at ¶ 22.) created danger, a type of due process violation. See Martinez v. City of Clovis, 943 F.3d 1260, 1271 (9th Cir. 2019). Like plaintiff’s first due process claim, the crux of the state- created danger claim is that the City has created dangerous conditions, to which plaintiff has been exposed, by failing to enforce its laws against homeless individuals residing near plaintiff’s property. (See Compl. at ¶¶ 14-21, 29-31.) Thus, this claim likewise directly challenges the City’s failure to enforce the law against others, and therefore plaintiff also lacks standing to pursue it. This claim fails for other reasons as well. Under the state-created danger rule, “the state may be constitutionally required to protect a plaintiff that it ‘affirmatively places in danger by acting with deliberate indifference to a known or obvious danger.’” Martinez, 943 F.3d at 1271 (quoting Patel v. Kent Sch. Dist., 648 F.3d 965, 971-72 (9th Cir. 2011)). To succeed on a state-created danger claim, a plaintiff must show, inter alia, that “the [defendant’s] affirmative actions created or exposed [the plaintiff] to an actual, particularized danger that [the plaintiff] would not otherwise have faced” and that the danger resulted in a foreseeable injury to the plaintiff. See id. (citing Hernandez v. City of San Jose, 897 F.3d 1125, 1133 (9th Cir. 2018)). Whether the defendant created a new danger or enhanced an existing one is not material; the focus is on whether there was “state action [versus] inaction in placing an individual at risk.” See Hernandez, 897 F.3d at 1134-35 (quoting Penilla v. City of Huntington Park, 115 F.3d 707, 710 (9th Cir. 1997)); Kennedy v. City of Ridgefield, 439 F.3d 1055, 1063 n.4 (9th Cir. 2006). According to plaintiff’s Complaint, the affirmative action which caused the danger to plaintiff was the City’s “decision to treat the area surrounding [plaintiff’s] Property as a containment zone” and its “fail[ure] and refus[al] to enforce” state and local laws; and the “danger” created thereby consisted of public health and safety hazards, harmful environmental conditions and increased crime and risk of property damage. (Compl. at ¶¶ 15-20.) Specifically, plaintiff alleges that, due to this danger, it was injured when “[t]he homeless . . . lit the Property on fire and vandalized it in a variety of other ways,” when its “tenants and their patrons [were made] to fear for their safety” due to drug use and odors, and when it was “forced to expend additional monetary resources on third-party security and cleanup crews” to “repair[ ] fire damage and other vandalism carried out by the homeless population.” (Compl. at ¶¶ 18-20.)4 As an initial matter, it is not clear that the term “danger” may, within the meaning of the state-created danger doctrine, be validly construed to include risks of purely economic injury to a corporation. Every Ninth Circuit decision of which this court is aware in which the court recognized a claim for state-created danger involved risks of bodily harm to individuals. See Hernandez, 897 F.3d at 1133-39 (noting focus of analysis is whether “state action . . . placed an individual at

4 Plaintiff also alleges that, because of the City’s failures, it has been “threaten[ed]” with “an increased risk of infection of COVID-19” and “loss of business and other opportunities,” though it does not allege that these threatened harms have yet been realized. (See id. at ¶ 21.) risk) (emphasis added); Henry A. v. Willden, 678 F.3d 991, 1002- 1003 (9th Cir. 2012); Kennedy, 439 F.3d at 1061-67; Munger v. City of Glasgow Police Dep’t, 227 F.3d 1082, 1086-88 (9th Cir. 2000); Penilla, 115 F.3d at 709-10; L.W. v. Grubbs, 974 F.2d 119, 120-23 (9th Cir. 1992); Wood v. Ostrander, 879 F.2d 583, 587-96 (9th Cir. 1989); see also Martinez, 943 F.3d at 1271-77 (holding individual plaintiff had demonstrated a valid claim for state- created danger based on physical injury, but ruling for defendants based on qualified immunity where relevant law was not clearly established); Pauluk v. Savage, 836 F.3d 1117, 1121-26 (9th Cir. 2016) (same). It is also doubtful that the Supreme Court in DeShaney v. Winnebago County Social Services Department, 489 U.S. 189 (1989) -- the progenitor of the state-created danger doctrine, see id. at 201 -- intended to allow § 1983 liability based on economic harms to non-individual plaintiffs, given that that case involved the infliction of bodily harm to a child. Id. at 192; see Cnty. of Sacramento v. Lewis, 523 U.S. 833, 842 (1998) (noting that the Court “ha[s] always been reluctant to expand the concept of substantive due process”) (quoting Collins v. City of Harker Heights, 503 U.S. 115, 125 (1992)). The only decision plaintiff identifies to have done so, Hunters Capital, is not binding and, more importantly, did not address this issue. (Opp. at 6-7); see 499 F. Supp. 3d at 901-03. More importantly, plaintiff fails to plausibly allege that any danger it faced was caused by an “affirmative action[ ]” by the City, as that term has been defined by the courts. Plaintiff describes the City’s non-enforcement as a “decision,” which it argues amounts to “affirmatively treating the area surrounding [plaintiff’s] property as a containment zone” and “affirmatively refus[ing] to enforce its own laws and those of the state.” (Compl. at ¶ 15; Opp. at 7.) That the City may have knowingly declined to enforce the law does not transform its non- enforcement from inaction into an affirmative act, nor does merely labeling such inaction “affirmative[ ].” See Lamberth v. Clark Cnty. Sch. Dist., 2:14-cv-2044-APG, 2015 WL 4760696, at *5 (D. Nev. Aug. 12, 2015) (“[Defendants’ alleged] omissions do not qualify as affirmative acts. Regardless of how it is phrased, the substance of these claims is that the defendants failed to render aid.”), aff’d, 698 F. App’x 387 (9th Cir. 2017); Estate of Gonzales v. Hickman, ED 05-cv-660 MMM (RCx), 2006 WL 4959780, at *14 (C.D. Cal. Jan. 30, 2006) (“Inserting the word ‘refusal’ . . . does not transform an omission into an affirmative act.”); Johnson v. City of Seattle, 385 F. Supp. 2d 1091, 1097 (W.D. Wash. 2005), aff’d, 474 F.3d 634 (9th Cir. 2007). Municipalities and the officials who enforce their laws are routinely required to make decisions about whether and when to do so. However, to hold that decisions not to enforce laws constitute “affirmative action” for purposes of state-created danger claims would impermissibly expand the scope of due process liability by allowing any mere omission to be reframed as actionable affirmative conduct. Ninth Circuit precedent recognizing claims for state-created danger makes clear that the official conduct in question must be affirmative in a more literal sense. See, e.g., Hernandez, 897 F.3d at 1133-35 (directing rally attendees toward violent crowd and blocking them from exiting through other routes); Kennedy, 439 F.3d at 1063 (verbally disclosing child molestation allegations to accused individual’s parent); Munger, 227 F.3d at 1087 (ejecting patron from bar); Penilla, 115 F.3d at 708, 710 (canceling paramedic request, breaking lock on door of plaintiff’s home, and placing plaintiff inside). Because allegations of actual affirmative conduct are absent from plaintiff’s complaint, it fails to state a claim for state-created danger. That claim will accordingly be dismissed. III. Equal Protection Claim In certain circumstances, an exception to the rule prohibiting constitutional challenges to lack of enforcement of the law may exist for equal protection claims alleging that enforcement of the law is done selectively for a discriminatory purpose and with a discriminatory effect. See Lacey v. Maricopa Cnty., 693 F.3d 896, 920 (9th Cir. 2012); Rosenbaum v. City & Cnty. of San Francisco, 484 F.3d 1142, 1152 (9th Cir. 2007). Such claims may proceed where a plaintiff alleges that a law was enforced against the plaintiff, but not against other similarly situated individuals, and that the defendant “decided to enforce the law against [the plaintiff] ‘on the basis of an impermissible ground such as race, religion or exercise of constitutional rights.’” See Lacey, 693 F.3d at 922 (quoting United States v. Kidder, 869 F.2d 1328, 1336 (9th Cir. 1989)) (alteration adopted); United States v. Armstrong, 517 U.S. 456, 464-65 (1996) (“A [litigant] may demonstrate that the administration of a . . . law is ‘directed so exclusively against a particular class of persons . . . with a mind so unequal and oppressive’ that the system of [enforcement] amounts to ‘a practical denial’ of equal protection of the law.”) (quoting Yick Wo v. Hopkins, 118 U.S. 356, 373 (1886)). Here, however, the basis of plaintiff’s equal protection claim is not that any law was enforced against it. Rather, it alleges that the City enforces certain ordinances against some homeless individuals but not against others. Crucially, plaintiff is part of neither group, and it has identified no authority establishing that it may bring a selective enforcement claim without alleging that it has itself been the subject of the challenged enforcement. See Lacey, 693 F.3d at 922; Allen, 468 U.S. 755 (“Our cases make clear . . . that . . . injury [resulting from discrimination] accords a basis for standing only to ‘those persons who are personally denied equal treatment’ by the challenged discriminatory conduct.”) (quoting Heckler v. Mathews, 465 U.S. 728, 739-40 (1984)); cf. Warth, 422 U.S. at 499 (“[E]ven when the plaintiff has alleged injury sufficient to meet the ‘case or controversy’ requirement, this Court has held that the plaintiff generally must assert his own legal rights and interests, and cannot rest his claim to relief on the legal rights or interests of third parties.”).5 5 Even if plaintiff could make out a claim that it has itself been the target of unlawful selective enforcement of the law, plaintiff also has not alleged that the non-enforcement decision was made “on the basis of an impermissible ground such as race, religion or exercise of constitutional rights.” Kidder, 869 F.2d at 1136 (citation omitted, alteration adopted); (see Opp. at 5-6 (quoting J.D.H. v. Las Vegas Metro Police Dep’t, 2:13-cv-1300 APG NJK, 2014 WL 3809131, at *4 (D. Nev. Aug. 1, 2014))). Nor does plaintiff appear to assert an equal protection claim as a “class of one.” Such a claim may lie “where the Nor has plaintiff identified any authority establishing that cities are required, as a matter of equal protection law, to treat all areas of the city alike. While it may be unfair for a city to afford businesses and residents in certain areas the benefit of enforcing local laws while denying that benefit to those in other areas, as plaintiff argues, it does not amount to a violation of equal protection. The court is aware of, and plaintiff has identified, no precedent demonstrating that it does, and to hold otherwise would expand the scope of the Equal Protection Clause in ways this court lacks the authority to extend it. Accordingly, plaintiff’s equal protection claim must also be dismissed.6

plaintiff alleges that [the plaintiff] has been intentionally treated differently from others similarly situated and that there is no rational basis for the difference in treatment.” Vill. of Willowbrook v. Olech, 528 U.S. 562, 564 (2000). “Where a plaintiff is making a class-of-one claim, the essence of the claim is that only the plaintiff has been discriminated against, and therefore the basis for the differential treatment might well have been because the plaintiff was unique . . . .” Scocca v. Smith, 11-cv-1318 EMC, 2012 WL 2375203, at *5 (N.D. Cal. June 22, 2012). Here, plaintiff does not allege that it has been singled out for differential treatment, but rather that the City has, on a city-wide scale, “arbitrarily determined where homeless encampments may or may not be located and what communities should be affected,” thereby “plac[ing] a disproportionate burden on some persons, communities, and businesses over others.” (Compl. at ¶ 27.) Such allegations cannot support a class-of-one claim. Cf. Thornton v. City of St. Helens, 425 F.3d 1158, 1167 (9th Cir. 2005) (“An equal protection claim will not lie by conflating all persons not injured into a preferred class receiving better treatment than the plaintiff.”) (citation and internal quotation marks omitted).

6 Plaintiff also asserts a claim for municipal liability premised upon an unconstitutional custom or policy. (Compl. at ¶¶ 35-38.) However, municipal liability under § 1983, recognized IV. State Law Claims Because the court will dismiss plaintiff’s federal claims, it no longer has federal question jurisdiction.7 Federal courts have “supplemental jurisdiction over all other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III of the United States Constitution.” 28 U.S.C. § 1367(a). A district court “may decline to exercise supplemental jurisdiction . . . [if] the district court has dismissed all claims over which it has original jurisdiction.” Id. at § 1367(c); see also Acri v. Varian Assocs., Inc., 114 F.3d 999, 1001 n.3 (9th Cir. 1997) (en banc) (district courts may decline sua sponte to exercise supplemental jurisdiction). “[I]n the usual case in which all federal-law claims are eliminated before trial, the balance of factors to be considered under the pendent jurisdiction doctrine -- judicial economy, convenience, fairness and comity -- will point toward declining to exercise jurisdiction over the remaining state-law claims.” Carnegie-Mellon Univ. v. Cohill, 484 U.S. 343, 350 n.7 (1988). Here, comity strongly weighs in favor of declining to

in Monell v. Department of Social Services of City of New York, 436 U.S. 658 (1978), is simply a means of suing a municipality for violations of constitutional rights, not an independent claim of its own. Because all of plaintiff’s constitutional claims are asserted against the City -- the only defendant in this action -– the claim for municipal liability is redundant of the others, and will thus be dismissed for the same reasons.

7 There is no diversity jurisdiction in this case. Although plaintiff is a Delaware corporation, and thus the parties are of diverse citizenship, neither party alleges that the amount in controversy exceeds $75,000. (Prayer (Docket No. 1)); see 28 U.S.C. § 1332(a). exercise supplemental jurisdiction over plaintiff’s state law claims. The state courts are fully competent to adjudicate such claims. Some of plaintiff’s claims raise complex questions of state law, such as the right to “pursuing and obtaining safety [and] happiness” under the California Constitution, which are better left for California courts to resolve. As for judicial economy, plaintiff’s state law claims have not been the subject of any significant litigation in this case, as this is the first instance in which the merits of plaintiff’s claims are being considered. Judicial economy does not weigh in favor of exercising supplemental jurisdiction. Finally, convenience and fairness do not weigh in favor of exercising supplemental jurisdiction over plaintiff’s remaining state law claims. The federal and state fora are equally convenient for the parties. There is no reason to doubt that the state court will provide an equally fair adjudication of the issues. There is nothing to prevent plaintiff from refiling its state law claims against the City in state court, and any additional cost or delay resulting therefrom should be minimal. Accordingly, the court declines to exercise supplemental jurisdiction and will dismiss plaintiff’s remaining state law claims. In so doing, this court passes no judgment on the merits of plaintiff’s state law claims. Not all wrongs can be remedied by resort to the federal courts. Plaintiff is still free to seek accountability for harms arising from the City’s alleged non-enforcement of its laws through plaintiff’s state law claims or through the democratic process. As Chief Justice Rehnquist observed in DeShaney: nn ne nnn enn ee nn nn nn nn nn nn nn nn nnn eo nD ae

The people . . . may well prefer a system of liability which would place upon the State and its officials the responsibility for failure to act in situations such as the present one. They may create such a system, if they do not have it already, by changing the tort law of the State in accordance with the regular lawmaking process. But they should not have it thrust upon them by this Court’s expansion of . . . the Fourteenth Amendment. 489 U.S. at 203. IT IS THEREFORE ORDERED that defendant’s motion to dismiss (Docket No. 11-1) be, and the same hereby is, GRANTED. Plaintiff has twenty days from the date of this Order to file an amended complaint, if it can do so consistent with this Order. If plaintiff should elect not to file an amended complaint by that date the Clerk shall enter final judgment of dismissal on this Order. □ - ak. Dated: May 26, 2022 WILLIAM B. SHUBB UNITED STATES DISTRICT JUDGE 16