Burney et al v. Secretary of the U.S. Department of the Interior

Filing 20

MEMORANDUM AND ORDER signed by Chief Judge Morrison C. England, Jr. on 10/2/2014 GRANTING 13 Defendant's Motion to Dismiss, and Plaintiffs are given a final chance to amend; not later than 20 days following the date this order is electronically filed, plaintiffs may (but are not required to) file an amended complaint. (Reader, L)

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UNITED STATES DISTRICT COURT

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EASTERN DISTRICT OF CALIFORNIA

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JAMES BURNEY AND KATHERINE F.
BURNEY, AS TRUSTEES OF THE
BURNEY FAMILY TRUST DATED
MAY 29, 1990,
Plaintiffs,

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No. 2:13-CV-02586-MCE-CKD

MEMORANDUM AND ORDER

v.
SECRETARY OF THE UNITED
STATES DEPARTMENT OF THE
INTERIOR,
Defendants.
Plaintiffs James Burney and Katherine F. Burney, as Trustees of the Burney

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Family Trust, (collectively “Plaintiffs”) originally initiated this action against the Secretary

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of the United States Department of the Interior (“Defendant”) on December 13, 2013.

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ECF No. 1. Plaintiffs alleged they were entitled to monetary compensation for violations

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of their rights under the Fifth Amendment and the Equal Protection Clause of the

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Fourteenth Amendment. Id. The Court dismissed the original Complaint with leave to

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amend. ECF No. 11. Plaintiffs then filed a First Amended Complaint (“FAC”), once

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again alleging a violation of the Fifth Amendment, but this time seeking only injunctive

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relief that would restrain Defendant from publishing “stigmatizing or damaging”

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information pertaining to the Plaintiffs’ property until removal of the dams has been
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authorized and approved. ECF No. 12. Presently before the Court is Defendant’s

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Motion to Dismiss the FAC for lack of subject matter jurisdiction and for failure to state a

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claim upon which injunctive relief can be granted. For the following reasons,

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Defendant’s Motion is GRANTED, and Plaintiffs are given one final chance to amend

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their Complaint.1

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BACKGROUND2

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Plaintiffs are the owners of approximately 580 acres of property, commonly known

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as Blue Heron RV Park, (“Property”) that fronts on and is contiguous with the Klamath

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River. There are four hydroelectric dams on the Klamath River upstream from Plaintiffs’

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Property. Plaintiffs claim that construction of the dams created lakes and contributed

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positively to the character and value of surrounding properties. According to Plaintiffs,

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their Property derives substantial value from its location on the frontage of the Klamath

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River, the proximity to the lakes upstream of the dams, the lakeside community, and the

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public’s attraction to water-related activities and recreational opportunities. Moreover,

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Plaintiffs contend that they have spent substantial sums improving the Property by

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constructing various structures, including a restaurant, residential buildings, roads, and

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other utilities on the Property. Plaintiffs also allege that they derive substantial income

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from the improvements constructed on their Property and that the value of the Property

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is dependent upon the character of the area, features, and activities associated with the

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Klamath River and lakes.

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According to Plaintiffs’ FAC, Defendant has entered into two written agreements
which provide for, among other things, the potential removal of the four dams and for the

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Because oral argument will not be of material assistance, the Court ordered this matter
submitted on the briefs. E.D. Cal. Local R. 230(g). See ECF No. 19.
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The following recitation of facts is taken, sometimes verbatim, from Plaintiffs’ FAC. ECF No. 12.

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draining the lakes. Plaintiffs assert that these agreements have been published, posted

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on the Internet, and distributed by Defendant to the media and public and that,

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consequently, there has been substantial publicity and coverage about the planned

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removal of the dams. More specifically, Plaintiffs contend that Defendant has prepared

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and distributed reports indicating that, if the dams are removed, Plaintiffs’ Property will

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face a substantially increased risk of flooding and that some of the sediment, which has

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accumulated behind the dams and which contains toxic and hazardous substances, will

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be transported downstream onto the Property.

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As a result, Plaintiffs claim that their Property has been stigmatized and that the

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publications have damaged the Property’s reputation and diminished its value, thus

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causing Plaintiffs irreparable harm. Plaintiffs contend Defendant’s conduct rises to the

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level of an uncompensated taking of Plaintiffs’ Property in violation of the Fifth

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Amendment, and they seek to permanently restrain Defendant from continuing to publish

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damaging and stigmatizing information about the removal of the dams until removal is

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authorized, approved, and reasonably probable to occur.

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STANDARD

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A.

Motion to Dismiss for Lack of Subject Matter Jurisdiction under Federal
Rule of Civil Procedure 12(b)(1)3
Federal courts are courts of limited jurisdiction, and are presumptively without

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jurisdiction over civil actions. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375,

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377 (1994). The burden of establishing the contrary rests upon the party asserting

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jurisdiction. Id. Because subject matter jurisdiction involves a court’s power to hear a

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case, it can never be forfeited or waived. United States v. Cotton, 535 U.S. 625, 630

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(2002). Accordingly, lack of subject matter jurisdiction may be raised by either party at

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Unless otherwise stated, all further references to “Rule” or “Rules” are to the Federal Rules of
Civil Procedure.

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any point during the litigation, through a motion to dismiss pursuant to Federal Rule of

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Civil Procedure 12(b)(1). Arbaugh v. Y&H Corp., 546 U.S. 500, 506 (2006); see also Int’l

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Union of Operating Eng’rs v. Cnty. of Plumas, 559 F.3d 1041, 1043-44 (9th Cir. 2009).

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Lack of subject matter jurisdiction may also be raised by the district court sua sponte.

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Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 583 (1999). Indeed, “courts have an

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independent obligation to determine whether subject matter jurisdiction exists, even in

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the absence of a challenge from any party.” Id.; see Fed. R. Civ. P. 12(h)(3) (requiring

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the court to dismiss the action if subject matter jurisdiction is lacking).

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There are two types of motions to dismiss for lack of subject matter jurisdiction: a

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facial attack and a factual attack. Thornhill Publ’g Co. v. Gen. Tel. & Elec. Corp.,

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594 F.2d 730, 733 (9th Cir. 1979). Thus, a party may either make an attack on the

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allegations of jurisdiction contained in the nonmoving party’s complaint, or may

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challenge the existence of subject matter jurisdiction in fact, despite the formal

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sufficiency of the pleadings. Id.

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When a party makes a facial attack on a complaint, the attack is unaccompanied

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by supporting evidence, and it challenges jurisdiction based solely on the pleadings.

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Safe Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir. 2004). If the motion to

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dismiss constitutes a facial attack, the Court must consider the factual allegations of the

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complaint to be true, and determine whether they establish subject matter jurisdiction.

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Savage v. Glendale High Union Sch. Dist. No. 205, 343 F.3d 1036, 1039 n.1 (9th Cir.

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2003). In the case of a facial attack, the motion to dismiss is granted only if the

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nonmoving party fails to allege an element necessary for subject matter jurisdiction. Id.

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However, in the case of a facial attack, district courts “may review evidence beyond the

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complaint without converting the motion to dismiss into a motion for summary judgment.”

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Safe Air for Everyone, 373 F.3d at 1039.

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In the case of a factual attack, “no presumptive truthfulness attaches to plaintiff’s

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allegations.” Thornill, 594 F.2d at 733 (internal citation omitted). The party opposing the

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motion has the burden of proving that subject matter jurisdiction does exist, and must
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present any necessary evidence to satisfy this burden. St. Clair v. City of Chico,

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880 F.2d 199, 201 (9th Cir. 1989). If the plaintiff’s allegations of jurisdictional facts are

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challenged by the adversary in the appropriate manner, the plaintiff cannot rest on the

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mere assertion that factual issues may exist. Trentacosta v. Frontier Pac. Aircraft Ind.,

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Inc., 813 F.2d 1553, 1558 (9th Cir. 1987) (quoting Exch. Nat’l Bank of Chi. v. Touche

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Ross & Co., 544 F.2d 1126, 1131 (2d Cir. 1976)). Furthermore, the district court may

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review any evidence necessary, including affidavits and testimony, in order to determine

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whether subject matter jurisdiction exists. McCarthy v. United States, 850 F.2d 558, 560

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(9th Cir. 1988); Thornhill, 594 F.2d at 733. If the nonmoving party fails to meet its

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burden and the court determines that it lacks subject matter jurisdiction, the court must

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dismiss the action. Fed. R. Civ. P. 12(h)(3).

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B.

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Motion to Dismiss for Failure to State a Claim under Rule 12(b)(6)
On a motion to dismiss for failure to state a claim under Federal Rule of Civil

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Procedure 12(b)(6), all allegations of material fact must be accepted as true and

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construed in the light most favorable to the nonmoving party. Cahill v. Liberty Mut. Ins.

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Co., 80 F.3d 336,337-38 (9th Cir. 1996). Rule 8(a)(2) requires only “a short and plain

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statement of the claim showing that the pleader is entitled to relief” in order to “give the

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defendant fair notice of what the . . . claim is and the grounds upon which it rests.” Bell

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Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41,

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47 (1957)). A complaint attacked by a Rule 12(b)(6) motion to dismiss does not require

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detailed factual allegations. However, “a plaintiff’s obligation to provide the grounds of

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his entitlement to relief requires more than labels and conclusions, and a formulaic

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recitation of the elements of a cause of action will not do.” Id. (internal citations and

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quotations omitted). A court is not required to accept as true a “legal conclusion

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couched as a factual allegation.” Ashcroft v. Iqbal, 129 S. Ct. 1937, 1950 (2009)

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(quoting Twombly, 550 U.S. at 555). “Factual allegations must be enough to raise a

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right to relief above the speculative level.” Twombly, 550 U.S. at 555 (citing 5 Charles

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Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1216 (3d ed. 2004)
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(stating that the pleading must contain something more than “a statement of facts that

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merely creates a suspicion [of] a legally cognizable right of action.”)).

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Furthermore, “Rule 8(a)(2) . . . requires a showing, rather than a blanket

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assertion, of entitlement to relief.” Twombly, 550 U.S. at 556 n.3 (internal citations and

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quotations omitted). Thus, “[w]ithout some factual allegation in the complaint, it is hard

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to see how a claimant could satisfy the requirements of providing not only ‘fair notice’ of

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the nature of the claim, but also ‘grounds’ on which the claim rests.” Id. (citing 5 Charles

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Alan Wright & Arthur R. Miller, supra, at § 1202). A pleading must contain “only enough

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facts to state a claim to relief that is plausible on its face.” Id. at 570. If the “plaintiffs . . .

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have not nudged their claims across the line from conceivable to plausible, their

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complaint must be dismissed.” Id. However, “[a] well-pleaded complaint may proceed

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even if it strikes a savvy judge that actual proof of those facts is improbable, and ‘that a

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recovery is very remote and unlikely.’” Id. at 556 (quoting Scheuer v. Rhodes, 416 U.S.

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232, 236 (1974)).

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C.

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Leave to amend
A court granting a motion to dismiss a complaint must then decide whether to

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grant leave to amend. Leave to amend should be “freely given” where there is no

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“undue delay, bad faith or dilatory motive on the part of the movant, . . . undue prejudice

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to the opposing party by virtue of allowance of the amendment, [or] futility of the

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amendment . . . .” Foman v. Davis, 371 U.S. 178, 182 (1962); Eminence Capital, LLC v.

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Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003) (listing the Foman factors as those to

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be considered when deciding whether to grant leave to amend). Not all of these factors

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merit equal weight. Rather, “the consideration of prejudice to the opposing party . . .

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carries the greatest weight.” Id. (citing DCD Programs, Ltd. v. Leighton, 833 F.2d 183,

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185 (9th Cir. 1987)). Dismissal without leave to amend is proper only if it is clear that

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“the complaint could not be saved by any amendment.” Intri-Plex Techs. v. Crest Group,

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Inc., 499 F.3d 1048, 1056 (9th Cir. 2007) (citing In re Daou Sys., Inc., 411 F.3d 1006,

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1013 (9th Cir. 2005); Ascon Props., Inc. v. Mobil Oil Co., 866 F.2d 1149, 1160 (9th Cir.
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1989) (“Leave need not be granted where the amendment of the complaint . . .

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constitutes an exercise in futility . . . .”)).

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ANALYSIS

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Defendant moves to dismiss Plaintiffs’ Fifth Amendment Takings Claim for lack of

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subject matter jurisdiction. More specifically, Defendant argues that, under the Tucker

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Act and the Little Tucker Act, district courts have jurisdiction over takings claims only if

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the plaintiff seeks $10,000 or less in compensation, while the Court of Federal Claims

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has jurisdiction over the remaining claims. ECF No. 13 at 7 (citing 28 U.S.C. §

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1491(a)(1); 28 U.S.C. § 1346(a)(2)). Defendant further argues that jurisdiction for

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takings claims under the Tucker Act is limited to monetary relief, and equitable relief is

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not authorized. See ECF No. 13 at (citing Richardson v. Morris, 409 U.S. 464, 465

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(1973)). Defendant is correct, and, to the extent the Complaint may be construed as

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seeking injunctive relief for a Takings Claim, the Motion is GRANTED with leave to

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amend.

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In opposition, Plaintiffs tacitly concede this point, arguing instead only that they

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are seeking relief pursuant to the Administrative Procedures Act (“APA”). See ECF

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No. 15. This argument is not well-taken. The Amended Complaint is devoid of any

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factual assertions going to unlawful agency action, let alone final agency action. Bennett

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v. Spear, 520 U.S. 154, 177 (1997) (only final agency action is subject to judicial review

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under the APA). Dismissal is thus appropriate.

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Regardless, even if Plaintiffs had adequately set forth an APA claim and alleged a

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basis for the Government’s waiver of sovereign immunity, they still cannot show that they

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are entitled to equitable relief when their injuries could be adequately remedied with

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monetary compensation in the appropriate court (i.e., a takings claim brought in a court

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with subject matter jurisdiction). See Stop the Beach Renourishment, Inc. v. Fla. Dept.

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of Environmental Protection, 560 U.S. 702, 740-41 (2010) (citations omitted). Indeed,
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injunctive relief is not available where a monetary award would suffice because

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compensable injuries are not irreparable. Cotter v. Desert Palace, Inc., 880 F.2d 1142,

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1145 (9th Cir. 1989) (citations omitted); Los Angeles Mem'l Coliseum Comm'n v. Nat'l

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Football League, 634 F.2d 1197, 1202 (9th Cir. 1980) (lost revenue would be

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compensable by a damage award if plaintiff prevailed on the merits and therefore injury

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was not irreparable). Accordingly, since Plaintiffs are free to pursue a takings claim and

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receive compensation in the appropriate court, they cannot show irreparable harm. See

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Preseault v. I.C.C., 494 U.S. 1, 11-12, (1990) (The Tucker Act and Little Tucker Act

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provides jurisdiction for a claim to recover damages founded on the Constitution in the

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United States claims court and district courts, respectively). Defendant’s Motion to

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Dismiss is GRANTED with leave to amend.

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CONCLUSION

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As set forth above, Defendant’s Motion to Dismiss (ECF No. 13) is GRANTED,

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and Plaintiffs are given one final chance to amend. Not later than twenty (20) days

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following the date this Order is electronically filed, Plaintiffs may (but are not required to)

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file an amended complaint. If no amended complaint is timely filed, the causes of action

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dismissed by virtue of this Order shall be dismissed with prejudice upon no further notice

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to the parties.

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IT IS SO ORDERED.
Dated: October 2, 2014

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