OSJ Pep Tennessee LLC v. California Department of Public Health et al, No. 2:2014cv03741 - Document 36 (C.D. Cal. 2014)
Court Description: ORDER GRANTING IN PART DEFENDANTS MOTIONS TO DISMISS 6 , 9 by Judge Dean D. Pregerson . (lc). Modified on 10/7/2014 (lc).
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OSJ Pep Tennessee LLC v. California Department of Public Health et al Doc. 36 1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 CENTRAL DISTRICT OF CALIFORNIA 10 11 OSJ PEP TENNESSE LLC, 12 13 14 15 16 17 18 Plaintiff, v. KAMALA D. HARRIS, CALIFORNIA DEPARTMENT OF PUBLIC HEALTH; RONALD CHAPMAN; CALIFORNIA HIGHWAY PATROL; JOSEPH A. FARROW; OFFICE OF THE ATTORNEY GENERAL, CALIFORNIA DEPARTMENT OF JUSTICE, Defendants. ___________________________ ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) Case No. CV 14-03741 DDP (MANx) ORDER GRANTING IN PART DEFENDANTS’ MOTIONS TO DISMISS [Dkt. Nos. 6 & 9] 19 20 Presently before the Court are two motions to dismiss and/or 21 strike portions of Plaintiff’s First Amended Complaint (“FAC”) in 22 this case, from two groups of Defendants. 23 Department of Public Health (“CDPH”) and Dr. Ron Chapman’s motion 24 to dismiss focuses primarily on the contract and property issues at 25 play in this case, while Defendants California Highway Patrol 26 (“CHP”), Office of the Attorney General (“OAG”), Joseph A. Farrow, 27 and Kamala D. Harris’s motion focuses on issues of unlawful 28 seizure. Defendants California Because the factual and legal questions involved in these Dockets.Justia.com 1 two sets of claims are mixed, the Court considers the two motions 2 together. 3 I. 4 BACKGROUND In 2010, CDPH purchased 13.7 million respirator masks, worth 5 $9.8 million, from a company named Global Protection USA, Inc. 6 (“GPI”). 7 CDPH requested that GPI store the masks for approximately two 8 months. 9 over, CDPH did not retrieve the masks. (Ex. 1, FAC.) Plaintiff alleges that after the purchase, (FAC, ¶¶ 16-17.) However, after the two month period was Instead, they remained 10 warehoused at GPI’s facility for approximately two years. 11 ¶ 18.) 12 storage, and that CDPH in some way “acknowledged that it owed the 13 storage fees.” 14 never actually paid these storage fees, which eventually totaled 15 some $761,100.00. 16 (Id. at Plaintiff alleges that GPI because to bill CDPH for (Id. at ¶ 19.) However, Plaintiff alleges, CDPH (Id. at ¶¶ 20-21.) GPI, for apparently unrelated reasons, filed for Chapter 11 17 bankruptcy in March 2012. 18 bankruptcy proceeding, GPI obtained permission of the bankruptcy 19 court to sell its “rights and claims against the California 20 Department of Public Health . . . arising from the storage of 21 CDPH’s 3M masks/respirators” to a company called Global Safety. 22 The sale took place on or around September 24, 2012. 23 At around the same time, GPI was pursuing administrative relief 24 against CDPH through the California Victim Compensation and 25 Government Claims Board (“VCCB”); that relief was summarily denied 26 on December 7, 2012. 27 28 (Id. at ¶ 21.) As part of the (Ex. 3, FAC.) (Id. at ¶ 21.) While the claim was pending with VCCB, Global Safety began negotiating to sell the masks themselves, to Leslee Sports, 2 1 apparently in the belief that GPI had held a “warehouseman’s lien” 2 on the masks to secure payment of the storage fees. 3 23.) 4 Pets Series 1, LLC, which in turn sold the masks to Leslee Sports. 5 “During negotiations for that sale, Rhino . . . represented that 6 CDPH could no longer assert any ownership claim to the Masks and 7 that Leslee could take ownership free and clear together with a 8 claim for unpaid storage fees.” 9 2012, Leslie sold “all of its rights and title to the masks” to 10 Global Safety transferred its interest in the claim to Rhino Plaintiff. 11 (Id. at ¶¶ 20, (Id. at ¶ 25.) On December 14, (Id. at ¶ 27.) At some point in this process, the masks had been transferred 12 to the care of a “third party warehouse in Los Angeles” belonging 13 to American Export Lines (“American Export”). 14 FAC.) 15 agent claiming that the masks had been “converted” by Plaintiff’s 16 predecessors in interest and demanding their prompt return. 17 6, FAC.) 18 Export, its attorney, an attorney from OAG, a CHP officer, and 19 other unidentified parties held a telephone conference, during 20 which the CHP and OAG representatives told American Export that the 21 masks were “stolen goods” and that the state would “shut down” 22 American Export’s operations if it was forced to obtain a court 23 order to get the masks. 24 turned the masks over to some state agent. 25 (Id. at ¶ 29; Ex. 6, On February 13, 2013, CDPH sent a letter to the warehouse (Ex. Plaintiff alleges that around February 20-24, American (Ex. 7, FAC.) American Export thereafter (Id.) Plaintiff therefore presents claims against CDPH for breach of 26 express, implied, or quasi-contract for failure to pay the fees; 27 against CDPH and CHP for conversion and trespass to chattels; 28 against CDPH, CHP, and OAG for violation of a statute prohibiting 3 1 the use of violence or intimidation; against Ron Chapman, Kamala 2 Harris, and Joseph Farrow individually for deprivation of 3 Fourteenth Amendment due process rights, as well as unlawful 4 seizure under the Fourth and Fourteenth Amendments, per 42 U.S.C. § 5 1983; against CDPH, CHP, and OAG for violations of the California 6 Constitution; and for a declaratory judgment regarding “the rights 7 and responsibilities of the parties arising from their ownership 8 interests, if any, in the Masks.” 9 (FAC ¶¶ 39-123.) Plaintiff requests compensatory and punitive damages, costs, 10 attorneys’ fees, prejudgment interest, declaratory judgment, and 11 either an order directing the return of the masks to Plaintiff or 12 an order directing Defendants to provide Plaintiff an appealable 13 hearing on CDPH’s interest in the masks. 14 II. 15 LEGAL STANDARD A complaint may be dismissed under Rule 12(b)(6) only if it 16 “either (1) lacks a cognizable legal theory or (2) fails to allege 17 sufficient facts to support a cognizable legal theory.” 18 Apple, Inc., 729 F.3d 953, 959 (9th Cir. 2013). 19 of material fact in the complaint are taken as true and construed 20 in the light most favorable to the plaintiff.” 21 Products Co., 552 F.3d 934, 937 (9th Cir. 2008). 22 well-pleaded factual allegations, a court should assume their 23 veracity and then determine whether they plausibly give rise to an 24 entitlement to relief.” 25 (2009). 26 /// 27 /// 28 /// Somers v. “All allegations Williams v. Gerber “When there are Ashcroft v. Iqbal, 556 U.S. 662, 679 4 1 III. DISCUSSION 2 A. 3 Storage Contract and Warehouseman’s Lien At the heart of this case is the question of what rights, if 4 any, Plaintiff acquired from its predecessors in interest. 5 Plaintiff asserts that GPI had, at the time of its bankruptcy, a 6 storage contract with CDPH: either an express/implied-in-fact 7 contract, a modification of the original purchase order, or, at the 8 very least, an equitable quasi-contract based on GPI’s reasonable 9 reliance on CDPH’s representations that it would pay storage fees. 10 (FAC ¶¶ 39-72.) 11 the warehouser of CDPH’s goods, a warehouseman’s lien on the masks 12 to secure payment of the storage fees. 13 argues, CDPH affirmatively abandoned the masks, which would also 14 allow GPI and its successors to claim ownership. 15 theory, CDPH owes Plaintiff either the storage fees or the masks. 16 Relatedly, Plaintiff asserts that GPI acquired, as Alternatively, Plaintiff Thus, under this Were CDPH a private party, Plaintiff’s contentions would 17 suffice to survive a motion to dismiss. 18 resolving Plaintiff’s claims would require a factual inquiry as to 19 whether GPI made an offer of continuing storage and whether CDPH 20 accepted the offer, either verbally or by continuing to store its 21 masks with GPI.1 22 likely could have obtained a warehouseman’s lien and the 23 concomitant right to sell the masks. 24 7209-10. At the very least, And if such a contractual agreement existed, GPI Cal. Commercial Code §§ 7206, 25 26 27 28 1 “Performance of the conditions of a proposal, or the acceptance of the consideration offered with a proposal, is an acceptance of the proposal.” Cal. Civ. Code § 1584. 5 1 However, because CDPH is a public entity, the matter is 2 different. As a general rule, public entities in California may 3 not contract in any manner other than that prescribed by 4 statute–usually by approval of the Department of General Services. 5 All contracts entered into by any state agency for . . . 6 services . . . or maintenance of property, real or personal . 7 . . are void unless and until approved by the department. 8 Every contract shall be transmitted with all papers, 9 estimates, and recommendations concerning it to the department 10 and, if approved by the department, shall be effective from 11 the date of the approval. 12 Cal. Pub. Cont. Code § 10295 (emphases added). 13 allege, even in its Opposition, that the purported contract was 14 transmitted to or approved by the Department. 15 Plaintiff does not Of course, it is not necessarily the responsibility of a party 16 suing a state agency to allege the details of internal 17 communications of the state government. 18 the entire contract would have arisen passively–“CDPH accepted 19 GPI’s offer of further storage . . . by maintaining the Masks at 20 GPI’s warehouse without objection” (FAC ¶ 43)–Plaintiff cannot rely 21 on a presumption that the contract had gone through the proper 22 channels. But in this case, where Because, absent a statutory exception,2 Department 23 2 24 25 26 27 28 Plaintiff notes that there are a few statutory exceptions to the general provision quoted above, see Cal.Gov.Code § 14616 (Director of General Services may exempt contracts under $50,000 from approval); Cal.Gov.Code § 11256 (Director may exempt service arrangement between state agencies). Plaintiff argues that "only discovery will reveal . . . whether and to what extent any of the myriad exceptions apply." (Opp'n at 24:6-9.) But § 10295, by including in its sweep "all" contracts, establishes a general presumption. Thus, to survive a motion to dismiss, Plaintiff must (continued...) 6 1 approval is a statutory requirement for contract formation, and all 2 other contracts are void as a matter of law, there could not have 3 been a contract between GPI and CDPH. 4 Plaintiff nonetheless argues that some form of quasi-contract 5 must apply to this situation. 6 avers, “by agreeing to store the masks for two months, GPI became 7 forever obligated to hold the Masks for CDPH and had no means to 8 collect payment or cause the state to recognize its obligation. 9 That cannot be the law.” 10 That is not the law. “Under Defendants’ logic,” Plaintiff (Opp’n at 25:25-27.) Although in general quasi-contract 11 cannot be found where the method of government contracting is 12 established by statute, Reams v. Cooley, 171 Cal. 150, 156-57 13 (1915), in extreme circumstances, equitable remedies like 14 promissory estoppel may be available. 15 by an equitable estoppel in the same manner as a private party when 16 . . . the injustice which would result from a failure to uphold an 17 estoppel is of sufficient dimension to justify any effect upon 18 public interest or policy which would result from the raising of an 19 estoppel.” 20 (1970). 21 “The government may be bound City of Long Beach v. Mansell, 3 Cal. 3d 462, 496-97 Here, however, there is little in the way of injustice that 22 will be wrought should the Court not apply estoppel. 23 “forever obligated to hold the Masks for CDPH.” GPI was not It could, for 24 25 26 27 28 2 (...continued) allege at least some facts tending to show that some statutory exception applies. Mere hope that some such exception applies and that "discovery will reveal" the exception is not enough. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 556 (2007) (plaintiff must allege "enough fact to raise a reasonable expectation that discovery will reveal evidence of" the purported cause of action). 7 1 example, have picked up the phone and demanded that CDPH come 2 collect its goods–a simple action that, surprisingly, is nowhere 3 alleged by Plaintiff. 4 sought injunctive relief based on trespass. 5 (excluding claims for injunctive relief from general provisions of 6 government immunity). 7 neglect by invoicing in the hope of collecting storage fees. 8 is understandable–had it worked, GPI might have been much the 9 richer. If a direct request failed, GPI could have Cal. Gov’t Code § 814 Instead, GPI decided to respond to CDPH’s That But that is not how government contracts are formed, and 10 GPI’s gamble that it could collect storage fees without a valid 11 contract does not compel the Court to set aside the important 12 public policy considerations embodied in the statutory limitations 13 placed on state agency contracting.3 14 Public policy considerations similarly counsel against finding 15 that GPI had a warehouseman’s lien, or that CDPH had abandoned the 16 masks. 17 and materialmen’s liens cannot be asserted against public property, 18 North Bay Const., Inc. v. City of Petaluma, 143 Cal.App.4th 552, 19 556 (2006), and CDPH argues that the same is true of warehouseman’s 20 liens. 21 Bay apply only to liens on real property, not the sort of fungible 22 personal property at issue here. 23 refer to “principles of sovereign immunity,” id., and Plaintiff 24 does not make a convincing argument as to why the warehouseman’s It is well-established under California law that mechanic’s Plaintiff counters that the line of cases cited in North But those cases consistently 25 26 27 28 3 “The statutory requirement of independent written approval of the Director of General Services protects the public from improvident or secret action . . . .” State of California v. Haslett Co., 45 Cal. App. 3d 252, 257 (1975). 8 1 lien statutes should be read to abrogate the general presumption of 2 immunity.4 3 Plaintiff does argue that real estate is specially protected 4 from liens because it is “irreplaceable,” while the masks in 5 question are “fungible.” 6 be fungible in a technical sense, it is not necessarily the case 7 that CDPH would be able to lay hands on 13.7 million such masks at 8 a moment’s notice in case of a public emergency. 9 is presumably what motivated the agency to purchase these masks in (Opp’n at 30:22,26.) But while they may Indeed, that fact 10 advance of any such emergency. 11 Plaintiff’s facts, that the agency was negligent in taking 12 possession of its property, that negligence did not entitle GPI to 13 claim ownership of state property. 14 Cardinale Warehousing Corp., 65 F. Supp. 760, 762 (D.N.J. 1946) 15 (finding no warehouseman’s lien against the federal government 16 because “[i]t would be intolerable to imagine that the United 17 States would not have the right at all times and under all 18 circumstances to the possession of such materials purchased to 19 promote the defense of the United States.”) (internal quotation 20 marks and ellipses omitted). Although it certainly appears, on See, e.g., United States v. 21 In short, absent specific statutory authorization, policy 22 considerations and general principles of sovereign immunity counsel 23 24 25 26 27 28 4 Plaintiff also cites no authority for its proposition. Plaintiff does cite to a sentence in In re S. Bay Expressway, L.P., but in context that sentence is clearly intended to distinguish between private and public property interests, not between mechanic’s liens and other liens: “[North Bay]stands for the unremarkable proposition that mechanic's liens cannot be asserted against a public's entity's interest in public property. Here, the mechanic's liens are asserted against Debtors' private property interests, not the concurrent property interest of Caltrans.” 434 B.R. 589, 601 (Bankr. S.D. Cal. 2010) (emphases added). 9 1 against finding that private parties can impose liens on personal 2 property owned by the state government. 3 For similar reasons, a court cannot presume that long-unused 4 government property has been abandoned, absent an “official action” 5 affirmatively showing intent to abandon. 6 & Sons, Inc., 165 F. Supp. 554, 560 (N.D. Cal. 1958). 7 interest in the government’s retaining ownership of the people’s 8 property, even despite neglect by officials, is far too great to 9 allow private parties to lay claim to supposedly “abandoned” items. City of Stockton v. Miles The public 10 This is why, for example, there is no right to adverse possession 11 of public property. 12 lose its rights through the negligence of its agents . . . .” 13 of Ed. of City & Cnty. of San Francisco v. Martin, 92 Cal. 209, 218 14 (1891). 15 Cal. Civ. Code § 1007. “The public is not to Bd. Plaintiff argues that CDPH’s failure to intervene or otherwise 16 assert its rights in the masks during GPI’s bankruptcy proceedings 17 is an official action showing intent to abandon. 18 must be rejected, as it relies on a failure to take action when it 19 might have been prudent–i.e., negligence, which does not suffice to 20 show intent to abandon. 21 in that case the city affirmatively showed its intent to abandon a 22 water channel by filling it with soil, as well as taking certain 23 other legislative steps to officially abandon the property. 24 Supp. at 560. 25 New Jersey is not such an affirmative official action–especially But that argument Plaintiff relies on City of Stockton, but 165 F. Declining to intervene in a bankruptcy proceeding in 26 27 28 10 1 where it was unclear what, if any, rights were actually being 2 transferred.5 The Court accordingly grants the motions to dismiss the first 3 4 through fourth and seventh causes of action. 5 finds that neither GPI nor any of its successors in interest had 6 any property right in the masks, this effectively also resolves the 7 thirteenth cause of action, for declaratory judgment as to the 8 parties’ rights in the masks. 9 (conversion) and sixth cause of action (trespass to chattels) rely Because the Court The fifth cause of action 10 on a property right in the masks which, as a matter of law, does 11 not exist, and therefore the Court grants the motions to dismiss as 12 to these claims as well. 13 B. Bane Act and Federal and State Constitutional Claims 14 1. Bane Act 15 Plaintiff asserts a claim under the Bane Act, Cal. Civ. Code § 16 52.1, which provides for damages and injunctive relief for an 17 individual “whose exercise or enjoyment of rights secured by the 18 Consitution or laws of the United States, or of rights secured by 19 the Constitution or laws of this state, has been interfered with.” 20 The intimidation must be accomplished “by threats, intimidation, or 21 coercion.” 22 alone, rather than intimidating or coercive acts, the plaintiff 23 must show that “the speech itself threatens violence against a 24 specific person or group of persons; and the person or group of 25 persons against whom the threat is directed reasonably fears that, Id. If the action is brought on the basis of speech 26 27 28 5 The Bankruptcy Court itself did not specify what the source of the property right in the masks might be: “. . . whether those claims arise under any warehouseman’s lien, abandonment claims, statute, common law, or otherwise . . . .” (Ex. 3, FAC.) 11 1 because of the speech, violence will be committed against them or 2 their property.” 3 Id. at §52.1(j). Defendants primarily argue that Plaintiff cannot assert the 4 Act’s protection because any alleged threats were against the third 5 party warehouse, not against Plaintiff, and because the state 6 believed at the time of the alleged actions that Leslee Sports, not 7 Plaintiff, was holding the masks. 8 CHP Defs.’ Reply at 11-13.) 9 independent reason to dismiss the claim on the face of the Bane Act 10 (CHP Defs.’ Mot. Dismiss at 8-9; However, because the Court finds an statute, it need not reach that issue here. 11 Plaintiff alleges that, during a phone conversation, the 12 Defendants threatened to shut down its third-party warehouser’s 13 business. 14 violence requirement. 15 may be against “property,” the plain meaning of the word “violence” 16 clearly involves some physical, destructive act, which would not 17 include administratively shutting down a business. 18 statement that an official may take official action is not a threat 19 of violence. 20 1109 (S.D. Cal. 2009) (“Det. Maus told Plaintiff that if he did not 21 consent to voluntarily submit a DNA sample he would attempt to get 22 a warrant and ‘come look[ing] for you.’ 23 violence against Plaintiff. . . .”) 24 therefore cannot sustain a Bane Act claim. 25 are granted as to this claim. 26 2. 27 28 This is not enough to satisfy § 52.1(j)’s threat-ofEven taking into account that the violence A mere Martin v. Cnty. of San Diego, 650 F. Supp. 2d 1094, Det. Maus did not threaten Plaintiff’s allegation The motions to dismiss Claims Under the California Constitution Plaintiff also brings two claims under different provisions of the California Constitution. First, Plaintiff alleges a violation 12 1 of Cal. Const. art. 1, § 7, which reads, in pertinent part, “A 2 person may not be deprived of life, liberty, or property without 3 due process of law . . . .” 4 not seek money damages for such a violation, and Plaintiff now 5 seeks only injunctive relief. 6 injunctive relief Plaintiff seeks is return of the masks, 7 presumably in order to sell them or seek storage fees from CDPH. 8 (FAC ¶ 115.) 9 law, the masks belong to the state and no storage fees are due, any Parties are agreed that Plaintiff may (Opp’n at 35:17-20.) However, the As the Court has now determined that, as a matter of 10 claim for injunctive relief is moot. 11 dismissed. 12 This claim is therefore Second, Plaintiff alleges a violation of Cal. Const. art. 1, § 13 13, which reads, in pertinent part, “The right of the people to be 14 secure in their persons, houses, papers, and effects against 15 unreasonable seizures and searches may not be violated . . . .” 16 Absent a claim under a statute like the Bane Act, Plaintiff 17 essentially alleges a freestanding constitutional tort. 18 The California Supreme Court has laid out a test for 19 determining whether such a tort exists. 20 consider whether there is evidence of an affirmative intent to 21 create such a tort; if so, the court gives effect to that intent. 22 Katzberg v. Regents of Univ. of California, 29 Cal. 4th 300, 317 23 (2002). 24 words of the provision do not on their own manifest any such 25 intent.” 26 context to determine whether such intent existed. 27 such intent can be found does the court proceed to a more free- 28 ranging “constitutional tort analysis” modeled on the United States The court must first “But with regard to most constitutional provisions, the Id. Thus, the court must often look to historical 13 Id. Only if no 1 Supreme Court case Bivens v. Six Unknown Named Agents of Fed. 2 Bureau of Narcotics. Id. 3 Federal courts in California have reached contradictory 4 conclusions about whether such a tort based on § 13 actually 5 exists. 6 done so based on an inference of intent on the part of the drafters 7 of the California Constitution, relying on language in Katzberg 8 suggesting that the tort remedy for unlawful searches and seizures 9 is an ancient one incorporated into American law from the English Those that have found a constitutional tort have generally 10 common law. 11 C 06-4968 VRW, 2007 WL 174434, at *1, *4-6 (N.D. Cal. Jan. 22, 12 2007) (undertaking the Katzberg analysis and concluding that no 13 tort remedy exists), with Millender v. Cnty. of Los Angeles, No. CV 14 05-2298 DDP RZX, 2007 WL 7589200 at *1, *39 (C.D. Cal. Mar. 15, 15 2007) rev'd in part, 472 F. App'x 627 (9th Cir. 2012) (finding that 16 Katzberg implied a historical foundation for tort remedy for 17 unlawful searches and seizures), and Smith v. County of Riverside, 18 No. EDCV 05–00512 VAP, at *1, *16–18 (C.D.Cal. May 16, 2006) 19 (same). 20 persuasive. 21 Compare Wigfall v. City & Cnty. of San Francisco, No. The Court finds the Millender/Smith reasoning more Defendants argue that Katzberg’s discussion of a New York case 22 describing the historical tort remedy for unlawful search and 23 seizure6 was meant only by way of example and is limited to the 24 specifics of New York law: “[T]he New York court found historical 25 support in New York case law and legislative history for New York’s 26 adoption of a damages remedy . . . . [But] the court in Wigfall 27 28 6 Brown v. State, 89 N.Y.2d 172 (1996). 14 1 found that an analysis of California legislative history did not 2 show support.” 3 (CHP Defs.’ Mot. Dismiss at 15:9-17.) But the Katzberg court in fact appears to have been pointing 4 to a general understanding that where a state constitution is 5 adopted that preserves the common law, it is appropriate for courts 6 to infer the existence of “constitutional torts” based on 7 historical tort remedies for the wrongs contemplated by specific 8 constitutional provisions: 9 In considering evidence of an implied right to seek damages, 10 we also believe it appropriate to examine, as have sister 11 state jurisdictions that have permitted damage suits to remedy 12 search and seizure violations, common law history from which 13 we might infer, within the provision at issue, an intent to 14 provide an action for damages to remedy a violation of that 15 provision . . . . 16 [T]he New York Court of Appeals observed that ‘the courts have 17 looked to the common-law antecedents of the constitutional 18 provision to discover whether a damage remedy may be implied. 19 New York's first Constitution in 1777 recognized and adopted 20 the existing common law of England and each succeeding 21 Constitution has continued that practice . . . .’ 22 23 Katzberg, 29 Cal. 4th at 322. The California Constitution, like the New York Constitution, 24 appears to have been drafted against a background expectation that 25 common law remedies would continue to be available. 26 shortly after the adoption of the Constitution, California affirmed 27 by statute that “[t]he Common Law of England, so far as it is not 28 repugnant to or inconsistent with the Constitution of the United 15 Indeed, 1 States, or the Constitution or laws of the State of California, 2 shall be the rule of decision in all the Courts of this State.” 3 Cal. Stats. 1850, ch. 95.7 4 English common law, by longstanding practice, provided a damages 5 remedy for unlawful searches and seizures. 6 quite likely that the framers of the California Constitution 7 expected and intended that violations of § 13 would have had a 8 common law tort remedy. 9 And as the Katzberg court noted, the Id. Thus it seems In the absence of an actual California Supreme Court decision, 10 this Court “must predict how the California Supreme Court would 11 decide the issue” and rule accordingly. 12 Video Corp., 116 F.3d 1297, 1300 (9th Cir. 1997). 13 California Supreme Court case ruling conclusively on this issue. 14 Therefore, the Court, following the analytic pattern set forth by 15 Katzberg, finds that Plaintiff can claim damages for a violation of 16 § 13. 17 Astaire v. Best Film & There is no Defendants’ motions to dismiss are therefore denied as to this 18 claim. 19 3. Claims Under 42 U.S.C. § 1983 for Violations of the Federal 20 Constitution 21 Finally, Plaintiff alleges that Defendants violated the Fourth 22 and Fourteenth Amendments of the United States Constitution by 23 seizing the masks, and it brings a claim for damages under 42 24 U.S.C. § 1983. 25 and it was also deprivation of property without due process of law. 26 Defendants argue that these claims “fail to state plausible claims The seizure itself was unlawful, Plaintiff argues, 27 28 7 The statute is today codified, with small changes, at Cal. Civ. Code § 22.2. 16 1 on which relief may be granted because, as a matter of law, 2 Plaintiff had no lawful right to possession or ownership of the 3 property that it claims was unlawfully seized by the Defendants.” 4 (CHP Defs.’ Mot. Dismiss at 2:14-20.) 5 But Plaintiff’s claim on the masks had not yet been 6 adjudicated at the time of seizure. 7 ultimately unavailing, legal argument for a lien and the right to 8 hold or sell the masks to recoup storage costs.8 9 determined that Plaintiff “had no lawful right to possession” of 10 11 It had a non-frivolous, if No court had yet the masks. Where property rights are disputed or imperfect, at the very 12 least a party is entitled to appropriate due process before the 13 property is seized. 14 context of the use of replevin by private parties: As the Supreme Court has explained in the 15 The right to a prior hearing, of course, attaches only to the 16 deprivation of an interest encompassed within the Fourteenth 17 Amendment's protection . . . . 18 The appellants who signed conditional sales contracts lacked 19 full legal title to the replevied goods. The Fourteenth 20 Amendment's protection of ‘property,’ however, has never been 21 interpreted to safeguard only the rights of undisputed 22 ownership. Rather, it has been read broadly to extend 23 protection to ‘any significant property interest . . . .’ 24 25 26 27 28 8 In particular, it appears that no previous court has taken up the question of whether a private party can obtain a warehouseman's lien and right of sale against the state's fungible personal property under Cal. Commercial Code § 7206(a). As Plaintiff points out, the lien and right to sell are available under § 7206(a) even in the absence of any contractual obligation. 17 1 The appellants were deprived of such an interest in the 2 replevied goods—the interest in continued possession and use 3 of the goods . . . . 4 Their ultimate right to continued possession was, of course, 5 in dispute. If it were shown at a hearing that the appellants 6 had defaulted on their contractual obligations, it might well 7 be that the sellers of the goods would be entitled to 8 repossession. But . . . [t]he right to be heard does not 9 depend upon an advance showing that one will surely prevail at 10 11 12 the hearing. Fuentes v. Shevin, 407 U.S. 67, 84 (1972) (emphases added). Nor does the right to be heard depend on whether the adverse 13 claimant is the state. 14 particular point, courts have been reluctant to deny private 15 parties due process in property disputes solely because the other 16 party is the government. 17 645 F. Supp. 2d 381, 396 (E.D. Pa. 2009) (holding that due process 18 requirements applied when government seized coins that were the 19 subject of an ownership dispute with a private party); United 20 States v. One Parcel of Real Prop. with Bldgs., Appurtenances & 21 Known as 170 Westfield Drive, Located in the Town of E. Greenwich, 22 Rhode Island, 34 F. Supp. 2d 107, 115 (D.R.I. 1999) (declining, 23 where the government had seized disputed property, to find that the 24 adverse private claimant had merely held the property in 25 constructive trust). 26 Although case law is sparse on this See Langbord v. U.S. Dep't of Treasury, Similarly, the Fourth Amendment protects against unlawful 27 searches and seizures even when title to the property is unclear, 28 and even when the adverse claimant is the government. 18 1 The premise that property interests control the right of the 2 Government to search and seize has been discredited. Searches 3 and seizures may be “unreasonable” within the Fourth Amendment 4 even though the Government asserts a superior property 5 interest at common law. We have recognized that the principal 6 object of the Fourth Amendment is the protection of privacy 7 rather than property, and have increasingly discarded 8 fictional and procedural barriers rested on property concepts. 9 Warden, Md. Penitentiary v. Hayden, 387 U.S. 294, 304 (1967) 10 (emphasis added). 11 Cir. 1994) (“The district court concluded no constitutional 12 violation had occurred because the [police department] owned the 13 dog at the time the animal was taken from the Leshers' home. 14 Regardless of the disputed ownership of this dog, the court erred 15 in dismissing the Leshers' Fourth Amendment claim.”). See also Lesher v. Reed, 12 F.3d 148, 150 (8th 16 In short, both the guarantee of due process of law under the 17 Fourteenth Amendment and the protection from unreasonable seizure 18 under the Fourth Amendment apply to seizures of property held by a 19 private party to which the government asserts a claim. 20 As the Defendants offer no other grounds for dismissal of 21 these claims, the motions to dismiss are denied as to the § 1983 22 claims. 23 24 25 26 /// 27 /// 28 /// 19 1 IV. CONCLUSION 2 The motions are granted and Plaintiff’s First Amended 3 Complaint is dismissed as to its First through Eighth, Eleventh, 4 and Thirteenth Causes of Action. 5 as to the Ninth, Tenth, and Twelfth Causes of Action. However, the motions are denied 6 7 IT IS SO ORDERED. 8 9 10 Dated: October 7, 2014 DEAN D. PREGERSON United States District Judge 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 20
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