Yanaki v. Iomed, Inc.

415 F.3d 1204, 24 I.E.R. Cas. (BNA) 617, 2005 U.S. App. LEXIS 15324, 2005 WL 1745595

• Court: Court of Appeals for the Tenth Circuit
• Decided: July 26, 2005
• Docket: 04-4061
• Status: Published

Opinions

MURPHY, Circuit Judge.

I. INTRODUCTION

As part of an action in state court, Iomed, Inc. sought and obtained an ex parte order directing local police, with the assistance of Iomed, to execute a search of Jamal Yanaki’s residence. After the search was exécuted and various items seized, Yanaki and Susan Moss filed a civil rights suit under 42 U.S.C. § 1983 against Iomed, several Iomed employees, lawyers for Iomed, and various other private actors. Plaintiffs’ complaint alleges deprivations of their rights to be free from unreasonable searches and seizures, infringement of their procedural and substantive due process rights, and several state law claims. The district court granted Defendants’ motion to dismiss under Fed.R.Civ.P. 12(b)(6) and Plaintiffs now appeal. This court exercises jurisdiction pursuant to 28 U.S.C. § 1291. Because we conclude that Plaintiffs have failed to allege a deprivation of rights committed under color of state law, we affirm the district court’s dismissal for failure to state a claim.

II. BACKGROUND¹

On April 9, 2002, Iomed, Inc. filed a complaint in Utah state court against Ya-naki, a former Iomed employee, alleging a variety of injuries including misappropriation of trade secrets and breach of a confidentiality agreement. The following day, Iomed filed an ex parte motion seeking an order permitting immediate discovery to prevent the destruction of evidence (the “Search Order”). On April 12 lawyers for Iomed appeared before a state court judge ex parte and argued the motion. The court granted Iomed’s motion and issued the Search Order which, in relevant part, directed the Salt Lake County Sheriffs Office, with the assistance of Iomed, to execute the Search Order at Yanaki’s home and take into custody all hard drives and other electronic storage media.²

On the morning of April 15 Justin Mat-kin, a lawyer for Iomed, arrived at Ya-naki’s home accompanied by Salt Lake County Deputy Sheriff Heinz Kopp. Moss answered the door and was served with the Search Order. Moss refused to allow Matkin and Kopp into the home because Yanaki was not present at the time. Kopp remained outside the home while Matkin returned to the state court judge to secure an ex parte writ of assistance. The judge issued a Supplemental Order in Aid of Enforcement (the “Enforcement Order”) which directed and authorized the Salt Lake County Sheriffs Office to enter Ya-naki’s residence and to use reasonable force, if necessary and appropriate, to execute the Search Order.

Matkin returned to Yanaki’s home with the Enforcement Order, and Matkin and Kopp, along with Mary Crowther and Scott Johnson, entered Yanaki’s home and commenced the search. Shortly thereafter a second police officer, Sergeant Kendra Herlin, arrived to assist. Pursuant to the Search Order, officers seized Moss and Yanaki’s computer and other materials belonging to them, including Yanaki’s University of Utah Executive MBA Program materials, various other papers and effects Yanaki had packed upon leaving Iomed, and a CD-ROM beloning to Ceramatec, Inc., a client of Yanaki’s consulting business.

On April 14, 2003, Yanaki and Moss filed separate complaints in United States District Court for the District of Utah seeking relief under 42 U.S.C. § 1983.³ In their complaints, which were subsequently consolidated, Plaintiffs alleged that the search of their residence violated their Fourth Amendment rights to be free from unreasonable searches and seizures and their procedural and substantive due process rights under the Fifth and Fourteenth Amendments.⁴

The district court granted Defendants’ motion to dismiss pursuant to Fed.R.Civ.P. 12(b)(6). The court concluded that Plaintiffs’ pleadings did not support the element of state action required to bring a claim under § 1983. The court then declined to exercise supplemental jurisdiction over Plaintiffs’ remaining state claims. Yanaki and Moss filed a timely notice of appeal challenging the district court’s order granting Defendants’ motion to dismiss.

III. STANDARD OF REVIEW

This court reviews a Rule 12(b)(6) dismissal de novo, accepting all well-pleaded facts as true and in the light most favorable to the nonmoving party. Sutton v. Utah State Sch. for the Deaf & Blind, 173 F.3d 1226, 1236 (10th Cir.1999). “A 12(b)(6) motion should not be granted unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.” Id. (quotation omitted).

IV. DISCUSSION

To state a claim under § 1983,⁵ Plaintiffs must allege that they were deprived of a right “secured by the Constitution and laws” of the United States and that this deprivation was committed under color of state law. Am. Mfrs. Mut. Ins. Co. v. Sullivan, 526 U.S. 40, 49-50, 119 S.Ct. 977, 143 L.Ed.2d 130 (1999). On appeal Plaintiffs contend that the district court erred when it concluded that the complaint failed to satisfy the color of state law requirement of § 1983. Plaintiffs argue that the involvement of the police in searching Moss and Yanaki’s home and seizing their property pursuant to the Search and Enforcement Orders suffices to establish conduct committed under color of law.

To be under color of law, the deprivation of a federal right “must be caused by the exercise of some right or privilege created by the State or by a rule of conduct imposed by the state or by a person for whom the State is responsible” .and “the party charged with the deprivation must be á person who may fairly be said to be a state actor ... because he is a state official, because he has acted together with or has obtained significant aid from state officials, or because his conduct is otherwise chargeable to the State.” Lugar v. Edmondson Oil Co., 457 U.S. 922, 937, 102 S.Ct. 2744, 73 L.Ed.2d 482 (1982).⁶ Applying this analytical framework in Lugar, the Court determined that the plaintiffs allegation that private conduct unlawful under state law deprived the plaintiff of his property without due process failed to state a claim under § 1983. Id. at 940, 102 S.Ct. 2744.⁷ The Court reasoned that the conduct “could not be ascribed to any governmental decision; rather [defendants] were acting contrary to the relevant policy articulated by the State.” Id. The Court concluded that invocation of a state “statute without the grounds to do so could in no way be attributed to a state rule or a state decision.” Id.

Similarly, this court has held that a private litigant’s use of state court proceedings to obtain an ex parte temporary restraining order does not satisfy the color of law requirement of § 1983. Torres v. First State Bank of Sierra County, 588 F.2d 1322, 1325-27 (10th Cir.1978). Consistent with - the principles announced in Lugar, this court discussed the issue as .follows:

Is there state action simply because in litigation in a state court that court exercised its authority to issue an order which we assume to be wrong and which did not give the debtor his rights to procedural due process? In answering the question it is important to consider what this case is not. It is not a situation where an unconstitutional statute, regulation or custom is being enforced by the state courts. Nor is this a case where a private contract furthering discrimination or other unconstitutional conduct is being enforced by the courts. This does not involve a state officer using his authority, or the appearance thereof, outside the scope of his statutory duties.

This is a case where private parties only were involved in state court litigation and it is alleged that the order granted by the court is not only erroneous but infringes one party’s rights to procedural due process....

We do not think that the “color of law” reference in § 198S was intended to encompass a case such as this one, where the only infirmities are the excesses of the court order itself, subject to immediate modification by a court hav ing jurisdiction over the parties, and subject to the normal processes of appeal.

Id. (emphasis added) (citations omitted); see also Lindley v. Amoco Prod. Co., 639 F.2d 671, 672-73 (10th Cir.1981) (holding that a discovery order was not state action).

Yanaki and Moss do not challenge the constitutionality of the state laws under which the Search and Enforcement Orders were issued. Indeed, Plaintiffs assert that issuance of the Orders was unlawful under state law.⁸ Without a challenge to the constitutionality of the state laws underlying the Search Order and accompanying Enforcement Order, the conduct of which Plaintiffs complain cannot be attributed to a decision of the state because “[Defendants] were acting contrary to the relevant policy articulated by the State.” Lugar, 457 U.S. at 940, 102 S.Ct. 2744.⁹ “To hold otherwise would open the door wide to every aggrieved litigant in a state court proceeding[ ], and set the federal courts up as an arbiter of the correctness of every state decision.” Bottone v. Lindsley, 170 F.2d 705, 707 (10th Cir.1948). Because Plaintiffs allege nothing more than “private misuse” of state laws, their complaint fails to satisfy the first part of the color of law test as announced in Lugar. See Lugar, 457 U.S. at 941, 102 S.Ct. 2744.

Plaintiffs, however, argue that the involvement of the police in the search of Moss and Yanaki’s residence makes this case factually distinguishable from the Supreme Court’s decision in Lugar. YanaM and Moss do not allege that Defendants conspired with the state court judge or with the police to obtain, .the Search Order or the Enforcement Order. See, e.g., Dennis v. Sparks, 449 U.S. 24, 27-28, 101 S.Ct. 183, 66 L.Ed.2d 185 (1980); Adickes v. S.H. Kress & Co., 398 U.S. 144, 152, 90 S.Ct. 1598, 26 L.Ed.2d 142 (1970). Plaintiffs allege only that Defendants’ search of the residence was conducted in concert with the police who were acting pursuant to the orders of the state court, which Plaintiffs admit were unlawful under state law. The involvement of the police in executing the court-ordered search, without more, does not convert Defendants’ abuse of state law into conduct attributable to the state for purposes of § 1983 liability. See Winterland Concessions Co. v. Trela, 735 F.2d 257, 262 (7th Cir.1984); Taylor v. Gilmartin, 686 F.2d 1346, 1348—49, 1355 n. 3 (10th Cir.1982); Torres, 588 F.2d at 1327.¹⁰ Without a challenge to the constitutionality of the underlying state laws or any suggestion of a conspiracy between Defendants and the police, the actions of the police in discharging their official duties do not distinguish Plaintiffs’ claims from the claim rejected in Lugar. See Lugar, 457 U.S. at 924, 102 S.Ct. 2744 (noting that the writ of attachment was executed by the County Sheriff).¹¹ Thus, Plaintiffs fail to satisfy the first part of the color of law test because the conduct that Plaintiffs complain deprived them of their constitutional rights was caused by and can only be attributed to the private Defendants. It is therefore unnecessary to address whether the private Defendants “may fairly be said to be [ ] state actor[s].” Id. at 937, 102 S.Ct. 2744.

y. CONCLUSION

Because there is no set of facts under which Plaintiffs can establish that the alleged deprivation of rights was committed under color of state law, we conclude that Plaintiffs have failed to state a claim under 42 U.S.C. § 1983.¹² This court therefore AFFIRMS the district court’s order dismissing Plaintiffs’ complaint under Fed.R.Civ.P. 12(b)(6).

1 . For purposes of an appeal from a Rule 12(b)(6) dismissal, we accept all well-pleaded factual allegations as true and view them in the light most favorable to the nonmoving party. Sutton v. Utah Sch. for the Deaf & Blind, 173 F.3d 1226, 1236 (10th Cir.1999).

2 . The state court did not specify which laws it was relying on when it issued the Search Order. In its memorandum in support of the ex parte motion, Iomed supplied three legal bases for issuance of the order: (1) the Utah Uniform Trade Secrets Act, codified as Utah Code Ann. §§ 13-24-1 to -9, which Iomed asserted provides Utah courts with authority to protect trade secrets by any reasonable means; (2) Rule 34 of the Utah Rules of Civil Procedure, which states, in relevant part, that a party may serve a request on another party "to permit entry upon designated land or other property in the possession or control of the party upon whom the request is served for the purpose of inspection and measuring, surveying, photographing, testing, or sampling the property or any designated object or operation thereon, within the scope of Rule 26(b),” Utah R. Civ. P. 34(a); and (3) the general authority of the court to compel compliance with its orders and to "control its process and orders to conform to law and justice,” Utah Code Ann. § 78-7-5.

3 . Yanaki and Moss named the following as defendants: Iomed, Inc.; Robert Lollini (Chief Operating Officer of Iomed); Mary Crowther (Iomed employee); Laura Millar (executive assistant at Iomed); Parr, Wad-doups, Brown, Gee & Loveless (Iomed's law firm); Clark Waddoups, Jonathan Hafen, and Justin Matkin (attorneys); Office Equipment Associates; Scott Johnson (owner and controller of Office Equipment Associates); and John Does I through XX (members of Iomed's Board of Directors and other unknown conspirators) [hereinafter and collectively, "Defendants” unless otherwise specified]. It is not disputed that all of the Defendants are private persons or actors.

4 . Although the issue was not addressed by the district court, Plaintiffs do not have a viable Fifth Amendment claim because the Fifth Amendment only applies to federal action. See Smith v. Kitchen, 156 F.3d 1025, 1028 (10th Cir.1997).

5 . Section 1983 provides, in relevant part:

Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory or the District of Columbia, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress, except that in any action brought against a judicial officer for an act or omission taken in such officer’s judicial capacity, injunctive relief shall not be granted unless a declaratory decree was violated or declaratory relief was unavailable.

42 U.S.C. § 1983.

6 . In determining whether the plaintiff’s claims satisfied the under color of law element of § 1983, the Supreme Court noted that the two parts of the test converge when the claim is "directed against a party whose official character is such as to lend the weight of the State to his decisions.” Lugar v. Edmondson Oil Co., 457 U.S. 922, 937, 102 S.Ct. 2744, 73 L.Ed.2d 482 (1982).

7 . Lugar involved a debtor who had sued his creditor under § 1983, alleging that the creditor's prejudgment attachment of the debtor's property deprived the debtor of his property rights without due process of law. Id. at 924-25, 102 S.Ct. 2744. Two counts of the plaintiff's complaint alleged violations of the Due Process Clause. Id. at 940, 102 S.Ct. 2744. In Count One plaintiff challenged the state statutory scheme, under which defendant had obtained prejudgment attachment of plaintiff’s property, as defective under the Fourteenth Amendment. Id. at 940-41, 102 S.Ct. 2744.' In Count Two plaintiff alleged a deprivation of property that resulted from defendant's “unlawful” conduct, by which plaintiff apparently meant unlawful under state law. Id. at 940, 102 S.Ct. 2744.

8 . At oral argument Plaintiffs admitted that there is no allegation in the complaint that the state laws upon which the Search and Enforcement Orders were based are facially unconstitutional. Plaintiffs had said as much in their complaint and in their briefs. See Complaint ¶ 182 (arguing that defendants avoided use of the constitutional Utah state laws and "misused the laws upon which they relied”); Aplt. Br. at 10 (recognizing that "long-established Utah law held that any state law purporting to authorize the procurement of civil search warrants by private parties in' civil litigation is illegal as in violation of the Utah Constitution”); id. at 14 n. 5 ("The orders clearly dp not constitute valid search warrants under Utah law.”); id. at 16-n. 6 (citing Allen v. Trueman, 100 Utah 36, 110 P.2d 355, 361 (1941), for the proposition that the Search Order was invalid under Utah law); Aplt. Reply Br. at 6 (arguing that Plaintiffs’ claim is strengthened by the suggestion that "there was no legal basis for such an order”).

9 . See also Cobb v. Saturn Land Co., 966 F.2d 1334, 1335 (10th Cir.1992) (noting that "action allegedly taken in violation, rather than under color, of state law, [] can serve as a basis only for Plaintiff's” state law claim); Roudybush v. Zabel, 813 F.2d 173, 177 (8th Cir.1987) ("State policy is not implicated when an injured party claims that a private party has violated a constitutional post-judgment procedural statute in the course of depriving the injured party of his property. To the contrary, the state, by enacting the statute, has expressly condemned a deprivation by such means.”); Barnard v. Young, 720 F.2d 1188, 1189 (10th Cir.1983) ("To the extent that plaintiff alleges that state law did not authorize defendant to obtain [plaintiff's medical] records, 'the conduct of which [plaintiff] complained could not be ascribed to any governmental decision.’" (quoting Lugar, 457 U.S. at 940, 102 S.Ct. 2744)); Gilmore v. Salt Lake Cmty. Action Program, 710 F.2d 632, 638 (10th Cir.1983) (concluding that because the “alleged deprivations [did not] result[] from a governmental rule, policy, or decision,” the conduct of the defendant, a state actor, was not state action).

10 . Plaintiffs’ reliance on Gallagher v. “Neil Young Freedom Concert,” 49 F.3d 1442 (10th Cir.1995), is misplaced. There was no suggestion in Gallagher that the allegedly unconstitutional pat-down searches at issue were conducted pursuant to a state court order that itself was unlawful under state law. See id. at 1445-46.

11 . The dissent focuses on the second part of the color of law test in Lugar and ignores the fact that Plaintiffs cannot satisfy the first part of the test because Defendants' conduct is not attributable to the state. See Lugar, 457 U.S. at 937, 940-41, 102 S.Ct. 2744. The dissent contends that the facts of the present case are analogous to those of. Howerton v. Gabica, 708 F.2d 380 (9th Cir.1983), in which the Ninth Circuit found the color of law requirements to be satisfied. In Howerton, however, the plaintiffs used the police to "put the weight of the state behind their private decision to evict,” causing the case to fall within the "abuse of authority” doctrine of Monroe v. Pape, 365 U.S. 167, 81 S.Ct. 473, 5 L.Ed.2d 492 (1961), and thus making it expressly distinguishable írom. Lugar. Howerton, 708 F.2d at 384 & n. 9 (noting that "[pjolice were on the scene at each step of the eviction” and "actively intervened” at the request of the private defendants and on the initiative of one of the officers). Here, the police involvement was caused solely by the issuance of the state court order and not by the private Defendants seeking out the police officers in aid of their private agenda. There is no suggestion by the dissent that Plaintiffs alleged a conspiracy between the police and the private Defendants, only that the police "facilitated the allegedly illegal search and seizure.” In this case, the conduct of the police does not fall under the abuse of authority doctrine of Monroe because the police, in executing the court order, were merely discharging their statutory duties. See Torres v. First State Bank of Sierra County, 588 F.2d 1322, 1326 (10th Cir.1978).

12 . Our disposition of Plaintiffs' appeal makes it unnecessary to address the alternative grounds for affirmance offered by Defendants.