OSJ Pep Tennessee LLC v. California Department of Public Health et al
Filing
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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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UNITED STATES DISTRICT COURT
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CENTRAL DISTRICT OF CALIFORNIA
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OSJ PEP TENNESSE LLC,
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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.
___________________________
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Case No. CV 14-03741 DDP (MANx)
ORDER GRANTING IN PART
DEFENDANTS’ MOTIONS TO DISMISS
[Dkt. Nos. 6 & 9]
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Presently before the Court are two motions to dismiss and/or
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strike portions of Plaintiff’s First Amended Complaint (“FAC”) in
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this case, from two groups of Defendants.
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Department of Public Health (“CDPH”) and Dr. Ron Chapman’s motion
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to dismiss focuses primarily on the contract and property issues at
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play in this case, while Defendants California Highway Patrol
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(“CHP”), Office of the Attorney General (“OAG”), Joseph A. Farrow,
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and Kamala D. Harris’s motion focuses on issues of unlawful
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seizure.
Defendants California
Because the factual and legal questions involved in these
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two sets of claims are mixed, the Court considers the two motions
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together.
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I.
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BACKGROUND
In 2010, CDPH purchased 13.7 million respirator masks, worth
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$9.8 million, from a company named Global Protection USA, Inc.
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(“GPI”).
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CDPH requested that GPI store the masks for approximately two
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months.
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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
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warehoused at GPI’s facility for approximately two years.
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¶ 18.)
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storage, and that CDPH in some way “acknowledged that it owed the
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storage fees.”
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never actually paid these storage fees, which eventually totaled
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some $761,100.00.
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(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
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bankruptcy in March 2012.
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bankruptcy proceeding, GPI obtained permission of the bankruptcy
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court to sell its “rights and claims against the California
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Department of Public Health . . . arising from the storage of
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CDPH’s 3M masks/respirators” to a company called Global Safety.
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The sale took place on or around September 24, 2012.
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At around the same time, GPI was pursuing administrative relief
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against CDPH through the California Victim Compensation and
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Government Claims Board (“VCCB”); that relief was summarily denied
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on December 7, 2012.
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(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,
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apparently in the belief that GPI had held a “warehouseman’s lien”
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on the masks to secure payment of the storage fees.
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23.)
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Pets Series 1, LLC, which in turn sold the masks to Leslee Sports.
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“During negotiations for that sale, Rhino . . . represented that
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CDPH could no longer assert any ownership claim to the Masks and
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that Leslee could take ownership free and clear together with a
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claim for unpaid storage fees.”
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2012, Leslie sold “all of its rights and title to the masks” to
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Global Safety transferred its interest in the claim to Rhino
Plaintiff.
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(Id. at ¶¶ 20,
(Id. at ¶ 25.)
On December 14,
(Id. at ¶ 27.)
At some point in this process, the masks had been transferred
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to the care of a “third party warehouse in Los Angeles” belonging
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to American Export Lines (“American Export”).
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FAC.)
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agent claiming that the masks had been “converted” by Plaintiff’s
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predecessors in interest and demanding their prompt return.
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6, FAC.)
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Export, its attorney, an attorney from OAG, a CHP officer, and
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other unidentified parties held a telephone conference, during
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which the CHP and OAG representatives told American Export that the
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masks were “stolen goods” and that the state would “shut down”
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American Export’s operations if it was forced to obtain a court
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order to get the masks.
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turned the masks over to some state agent.
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(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
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express, implied, or quasi-contract for failure to pay the fees;
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against CDPH and CHP for conversion and trespass to chattels;
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against CDPH, CHP, and OAG for violation of a statute prohibiting
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the use of violence or intimidation; against Ron Chapman, Kamala
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Harris, and Joseph Farrow individually for deprivation of
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Fourteenth Amendment due process rights, as well as unlawful
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seizure under the Fourth and Fourteenth Amendments, per 42 U.S.C. §
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1983; against CDPH, CHP, and OAG for violations of the California
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Constitution; and for a declaratory judgment regarding “the rights
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and responsibilities of the parties arising from their ownership
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interests, if any, in the Masks.”
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(FAC ¶¶ 39-123.)
Plaintiff requests compensatory and punitive damages, costs,
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attorneys’ fees, prejudgment interest, declaratory judgment, and
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either an order directing the return of the masks to Plaintiff or
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an order directing Defendants to provide Plaintiff an appealable
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hearing on CDPH’s interest in the masks.
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II.
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LEGAL STANDARD
A complaint may be dismissed under Rule 12(b)(6) only if it
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“either (1) lacks a cognizable legal theory or (2) fails to allege
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sufficient facts to support a cognizable legal theory.”
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Apple, Inc., 729 F.3d 953, 959 (9th Cir. 2013).
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of material fact in the complaint are taken as true and construed
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in the light most favorable to the plaintiff.”
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Products Co., 552 F.3d 934, 937 (9th Cir. 2008).
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well-pleaded factual allegations, a court should assume their
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veracity and then determine whether they plausibly give rise to an
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entitlement to relief.”
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(2009).
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Somers v.
“All allegations
Williams v. Gerber
“When there are
Ashcroft v. Iqbal, 556 U.S. 662, 679
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III. DISCUSSION
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A.
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Storage Contract and Warehouseman’s Lien
At the heart of this case is the question of what rights, if
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any, Plaintiff acquired from its predecessors in interest.
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Plaintiff asserts that GPI had, at the time of its bankruptcy, a
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storage contract with CDPH: either an express/implied-in-fact
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contract, a modification of the original purchase order, or, at the
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very least, an equitable quasi-contract based on GPI’s reasonable
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reliance on CDPH’s representations that it would pay storage fees.
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(FAC ¶¶ 39-72.)
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the warehouser of CDPH’s goods, a warehouseman’s lien on the masks
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to secure payment of the storage fees.
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argues, CDPH affirmatively abandoned the masks, which would also
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allow GPI and its successors to claim ownership.
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theory, CDPH owes Plaintiff either the storage fees or the masks.
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Relatedly, Plaintiff asserts that GPI acquired, as
Alternatively, Plaintiff
Thus, under this
Were CDPH a private party, Plaintiff’s contentions would
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suffice to survive a motion to dismiss.
At the very least,
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resolving Plaintiff’s claims would require a factual inquiry as to
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whether GPI made an offer of continuing storage and whether CDPH
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accepted the offer, either verbally or by continuing to store its
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masks with GPI.1
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likely could have obtained a warehouseman’s lien and the
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concomitant right to sell the masks.
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7209-10.
And if such a contractual agreement existed, GPI
Cal. Commercial Code §§ 7206,
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“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.
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However, because CDPH is a public entity, the matter is
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different.
As a general rule, public entities in California may
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not contract in any manner other than that prescribed by
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statute–usually by approval of the Department of General Services.
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All contracts entered into by any state agency for . . .
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services . . . or maintenance of property, real or personal .
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. . are void unless and until approved by the department.
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Every contract shall be transmitted with all papers,
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estimates, and recommendations concerning it to the department
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and, if approved by the department, shall be effective from
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the date of the approval.
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Cal. Pub. Cont. Code § 10295 (emphases added).
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allege, even in its Opposition, that the purported contract was
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transmitted to or approved by the Department.
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Plaintiff does not
Of course, it is not necessarily the responsibility of a party
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suing a state agency to allege the details of internal
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communications of the state government.
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the entire contract would have arisen passively–“CDPH accepted
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GPI’s offer of further storage . . . by maintaining the Masks at
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GPI’s warehouse without objection” (FAC ¶ 43)–Plaintiff cannot rely
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on a presumption that the contract had gone through the proper
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channels.
But in this case, where
Because, absent a statutory exception,2 Department
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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...)
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approval is a statutory requirement for contract formation, and all
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other contracts are void as a matter of law, there could not have
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been a contract between GPI and CDPH.
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Plaintiff nonetheless argues that some form of quasi-contract
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must apply to this situation.
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avers, “by agreeing to store the masks for two months, GPI became
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forever obligated to hold the Masks for CDPH and had no means to
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collect payment or cause the state to recognize its obligation.
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That cannot be the law.”
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That is not the law.
“Under Defendants’ logic,” Plaintiff
(Opp’n at 25:25-27.)
Although in general quasi-contract
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cannot be found where the method of government contracting is
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established by statute, Reams v. Cooley, 171 Cal. 150, 156-57
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(1915), in extreme circumstances, equitable remedies like
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promissory estoppel may be available.
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by an equitable estoppel in the same manner as a private party when
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. . . the injustice which would result from a failure to uphold an
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estoppel is of sufficient dimension to justify any effect upon
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public interest or policy which would result from the raising of an
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estoppel.”
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(1970).
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“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
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will be wrought should the Court not apply estoppel.
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“forever obligated to hold the Masks for CDPH.”
GPI was not
It could, for
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(...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).
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example, have picked up the phone and demanded that CDPH come
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collect its goods–a simple action that, surprisingly, is nowhere
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alleged by Plaintiff.
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sought injunctive relief based on trespass.
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(excluding claims for injunctive relief from general provisions of
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government immunity).
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neglect by invoicing in the hope of collecting storage fees.
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is understandable–had it worked, GPI might have been much the
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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
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GPI’s gamble that it could collect storage fees without a valid
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contract does not compel the Court to set aside the important
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public policy considerations embodied in the statutory limitations
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placed on state agency contracting.3
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Public policy considerations similarly counsel against finding
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that GPI had a warehouseman’s lien, or that CDPH had abandoned the
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masks.
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and materialmen’s liens cannot be asserted against public property,
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North Bay Const., Inc. v. City of Petaluma, 143 Cal.App.4th 552,
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556 (2006), and CDPH argues that the same is true of warehouseman’s
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liens.
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Bay apply only to liens on real property, not the sort of fungible
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personal property at issue here.
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refer to “principles of sovereign immunity,” id., and Plaintiff
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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
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“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).
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lien statutes should be read to abrogate the general presumption of
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immunity.4
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Plaintiff does argue that real estate is specially protected
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from liens because it is “irreplaceable,” while the masks in
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question are “fungible.”
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be fungible in a technical sense, it is not necessarily the case
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that CDPH would be able to lay hands on 13.7 million such masks at
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a moment’s notice in case of a public emergency.
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is presumably what motivated the agency to purchase these masks in
(Opp’n at 30:22,26.)
But while they may
Indeed, that fact
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advance of any such emergency.
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Plaintiff’s facts, that the agency was negligent in taking
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possession of its property, that negligence did not entitle GPI to
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claim ownership of state property.
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Cardinale Warehousing Corp., 65 F. Supp. 760, 762 (D.N.J. 1946)
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(finding no warehouseman’s lien against the federal government
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because “[i]t would be intolerable to imagine that the United
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States would not have the right at all times and under all
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circumstances to the possession of such materials purchased to
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promote the defense of the United States.”) (internal quotation
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marks and ellipses omitted).
Although it certainly appears, on
See, e.g., United States v.
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In short, absent specific statutory authorization, policy
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considerations and general principles of sovereign immunity counsel
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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).
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against finding that private parties can impose liens on personal
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property owned by the state government.
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For similar reasons, a court cannot presume that long-unused
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government property has been abandoned, absent an “official action”
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affirmatively showing intent to abandon.
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& Sons, Inc., 165 F. Supp. 554, 560 (N.D. Cal. 1958).
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interest in the government’s retaining ownership of the people’s
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property, even despite neglect by officials, is far too great to
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allow private parties to lay claim to supposedly “abandoned” items.
City of Stockton v. Miles
The public
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This is why, for example, there is no right to adverse possession
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of public property.
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lose its rights through the negligence of its agents . . . .”
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of Ed. of City & Cnty. of San Francisco v. Martin, 92 Cal. 209, 218
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(1891).
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Cal. Civ. Code § 1007.
“The public is not to
Bd.
Plaintiff argues that CDPH’s failure to intervene or otherwise
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assert its rights in the masks during GPI’s bankruptcy proceedings
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is an official action showing intent to abandon.
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must be rejected, as it relies on a failure to take action when it
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might have been prudent–i.e., negligence, which does not suffice to
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show intent to abandon.
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in that case the city affirmatively showed its intent to abandon a
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water channel by filling it with soil, as well as taking certain
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other legislative steps to officially abandon the property.
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Supp. at 560.
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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
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where it was unclear what, if any, rights were actually being
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transferred.5
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The Court accordingly grants the motions to dismiss the first
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through fourth and seventh causes of action.
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finds that neither GPI nor any of its successors in interest had
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any property right in the masks, this effectively also resolves the
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thirteenth cause of action, for declaratory judgment as to the
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parties’ rights in the masks.
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(conversion) and sixth cause of action (trespass to chattels) rely
Because the Court
The fifth cause of action
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on a property right in the masks which, as a matter of law, does
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not exist, and therefore the Court grants the motions to dismiss as
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to these claims as well.
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B.
Bane Act and Federal and State Constitutional Claims
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1.
Bane Act
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Plaintiff asserts a claim under the Bane Act, Cal. Civ. Code §
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52.1, which provides for damages and injunctive relief for an
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individual “whose exercise or enjoyment of rights secured by the
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Consitution or laws of the United States, or of rights secured by
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the Constitution or laws of this state, has been interfered with.”
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The intimidation must be accomplished “by threats, intimidation, or
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coercion.”
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alone, rather than intimidating or coercive acts, the plaintiff
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must show that “the speech itself threatens violence against a
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specific person or group of persons; and the person or group of
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persons against whom the threat is directed reasonably fears that,
Id.
If the action is brought on the basis of speech
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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.)
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because of the speech, violence will be committed against them or
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their property.”
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Id. at §52.1(j).
Defendants primarily argue that Plaintiff cannot assert the
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Act’s protection because any alleged threats were against the third
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party warehouse, not against Plaintiff, and because the state
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believed at the time of the alleged actions that Leslee Sports, not
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Plaintiff, was holding the masks.
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CHP Defs.’ Reply at 11-13.)
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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.
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Plaintiff alleges that, during a phone conversation, the
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Defendants threatened to shut down its third-party warehouser’s
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business.
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violence requirement.
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may be against “property,” the plain meaning of the word “violence”
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clearly involves some physical, destructive act, which would not
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include administratively shutting down a business.
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statement that an official may take official action is not a threat
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of violence.
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1109 (S.D. Cal. 2009) (“Det. Maus told Plaintiff that if he did not
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consent to voluntarily submit a DNA sample he would attempt to get
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a warrant and ‘come look[ing] for you.’
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violence against Plaintiff. . . .”)
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therefore cannot sustain a Bane Act claim.
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are granted as to this claim.
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2.
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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
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of Cal. Const. art. 1, § 7, which reads, in pertinent part, “A
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person may not be deprived of life, liberty, or property without
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due process of law . . . .”
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not seek money damages for such a violation, and Plaintiff now
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seeks only injunctive relief.
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injunctive relief Plaintiff seeks is return of the masks,
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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, §
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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 . . . .”
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Absent a claim under a statute like the Bane Act, Plaintiff
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essentially alleges a freestanding constitutional tort.
18
The California Supreme Court has laid out a test for
19
determining whether such a tort exists.
The court must first
20
consider whether there is evidence of an affirmative intent to
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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
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(2002).
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words of the provision do not on their own manifest any such
25
intent.”
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context to determine whether such intent existed.
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such intent can be found does the court proceed to a more free-
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ranging “constitutional tort analysis” modeled on the United States
“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,
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2007) rev'd in part, 472 F. App'x 627 (9th Cir. 2012) (finding that
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Katzberg implied a historical foundation for tort remedy for
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unlawful searches and seizures), and Smith v. County of Riverside,
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No. EDCV 05–00512 VAP, at *1, *16–18 (C.D.Cal. May 16, 2006)
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(same).
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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
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support in New York case law and legislative history for New York’s
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adoption of a damages remedy . . . . [But] the court in Wigfall
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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
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to infer the existence of “constitutional torts” based on
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historical tort remedies for the wrongs contemplated by specific
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constitutional provisions:
9
In considering evidence of an implied right to seek damages,
10
we also believe it appropriate to examine, as have sister
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state jurisdictions that have permitted damage suits to remedy
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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
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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.
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quite likely that the framers of the California Constitution
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expected and intended that violations of § 13 would have had a
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common law tort remedy.
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And as the Katzberg court noted, the
Id.
Thus it seems
In the absence of an actual California Supreme Court decision,
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this Court “must predict how the California Supreme Court would
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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.
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Therefore, the Court, following the analytic pattern set forth by
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Katzberg, finds that Plaintiff can claim damages for a violation of
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§ 13.
17
Astaire v. Best Film &
There is no
Defendants’ motions to dismiss are therefore denied as to this
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claim.
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3.
Claims Under 42 U.S.C. § 1983 for Violations of the Federal
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Constitution
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Finally, Plaintiff alleges that Defendants violated the Fourth
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and Fourteenth Amendments of the United States Constitution by
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seizing the masks, and it brings a claim for damages under 42
24
U.S.C. § 1983.
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and it was also deprivation of property without due process of law.
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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,
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Plaintiff had no lawful right to possession or ownership of the
3
property that it claims was unlawfully seized by the Defendants.”
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(CHP Defs.’ Mot. Dismiss at 2:14-20.)
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But Plaintiff’s claim on the masks had not yet been
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adjudicated at the time of seizure.
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ultimately unavailing, legal argument for a lien and the right to
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hold or sell the masks to recoup storage costs.8
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determined that Plaintiff “had no lawful right to possession” of
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It had a non-frivolous, if
No court had yet
the masks.
Where property rights are disputed or imperfect, at the very
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least a party is entitled to appropriate due process before the
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property is seized.
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context of the use of replevin by private parties:
As the Supreme Court has explained in the
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The right to a prior hearing, of course, attaches only to the
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deprivation of an interest encompassed within the Fourteenth
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Amendment's protection . . . .
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The appellants who signed conditional sales contracts lacked
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full legal title to the replevied goods. The Fourteenth
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Amendment's protection of ‘property,’ however, has never been
21
interpreted to safeguard only the rights of undisputed
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ownership. Rather, it has been read broadly to extend
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protection to ‘any significant property interest . . . .’
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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 . . . .
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Their ultimate right to continued possession was, of course,
5
in dispute. If it were shown at a hearing that the appellants
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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
///
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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
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7
IT IS SO ORDERED.
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Dated: October 7, 2014
DEAN D. PREGERSON
United States District Judge
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