I WIN. YOU WIN. IRWIN LLC et al v. CASEYS PUB, INC et al

Filing 30

OPINION AND ORDER granting in part 23 Motion for judgment on the pleadings and remanding counts I through XI of plaintiff's complaint and defendant's counterclaim to Wayne County Circuit Court. Signed by District Judge George Caram Steeh. (DPer)

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MICHIGAN
SOUTHERN DIVISION
I WIN. YOU WIN. IRWIN LLC,
RANDI IRWIN, and
JOHNNY IRWIN,
Plaintiffs,
Case No. 18-11151
v.
HON. GEORGE CARAM STEEH
CASEY’S PUB, INC., a Michigan
Corporation, KIMBERLY POWERS,
ANDREA HUIZAR, JUSTIN THEUT,
3RD PRECINCT OF THE DETROIT
POLICE DEPARTMENT, and the
CITY OF DETROIT, jointly and severally,
Defendants.
_________________________________/
OPINION AND ORDER GRANTING IN PART
AND DENYING IN PART DEFENDANTS’
MOTION FOR JUDGMENT ON THE PLEADINGS (Doc. 23)
Defendants Justin Theut, the 3rd Precinct of the City of Detroit Police
Department, and the City of Detroit have moved for judgment on the
pleadings pursuant to Federal Rule of Civil Procedure 12(c), which has
been fully briefed. The court heard oral argument on October 16, 2018.
For the reasons stated below, Defendants’ motion is GRANTED IN PART
and DENIED IN PART.

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BACKGROUND FACTS
This action arises out of a landlord-tenant dispute. Plaintiffs Johnny
Irwin, Randi Irwin, and I Win. You Win. Irwin, LLC, entered a commercial
lease with Defendants Andrea Huizar and Casey’s Pub, Inc. in 2016. In the
leased building, Plaintiffs operated Red Corridor, a bar and grill. As a result
of various disputes between the parties, which are not relevant here,
Plaintiffs decided to terminate the lease in November 2017. Plaintiffs
allege that they paid the rental fees through the end of November 2017.
On November 27, 2017, Johnny Irwin was packing up the contents of
the building when Huizar called to request another payment. Irwin refused,
stating that he did not owe her any money because she “had not paid for
any of the HVAC costs as required.” Compl. at ¶ 31. Huizar told Irwin that
the lease was for the duration of a year and that he still owed her money.
Id. at ¶ 32. Plaintiffs allege that Huizar “then called the Detroit Police
Department and told the operator that Mr. Irwin was a disgruntled
employee and was stealing all of the contents of her building.” Id. at ¶ 33.
According to Plaintiffs, Detroit police officer Justin Theut “arrived on
the scene and instructed Mr. Irwin to leave the premises, not take any of
his belongings, and to not return to the premises or he would have to arrest
him.” Id. at ¶ 34. Officer Theut “said he has met Johnny Irwin, has been
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[to] the establishment, and would prefer his cooperation.” Id. Johnny Irwin
called his wife, Randi Irwin, who put Plaintiffs’ attorney, Stuart Collis, on the
phone. Collis sought to speak to Officer Theut, who refused. Id. at ¶ 3637. Collis had Johnny Irwin explain to Officer Theut that he had “a legal
right to be on the premises, and that taking this action would be illegal and
in violation of Michigan’s Lock Out statute.” Id. at ¶ 38. Officer Theut told
Johnny Irwin “that if he did not leave he would be arrested as a trespasser.”
Id. at ¶ 39.
Collis called the 3rd Precinct of the Detroit Police Department and
asked to speak to the sergeant, but he was not available. Id. at ¶ 41.
Plaintiffs allege that the “precinct refused to intervene because they
claimed that the officer was ‘an experienced officer that wouldn’t do
anything illegal.’” Id. at ¶ 117. A supervisor informed Collis that they would
send another officer to investigate, but Plaintiffs allege that “the 3rd precinct
did not correct the situation and enforced the lockout either tacitly or
intentionally.” Id. at ¶ 42.
Plaintiffs contend that Officer Theut “compelled Johnny Irwin to leave
the premises by threat of arrest.” Id. at 43. At some point, Huizar texted
Johnny Irwin to inform him that she had changed the locks to the building,
which contained his personal property as well as the property of I Win. You
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Win. Irwin, LLC. Id. Huizar also allegedly threatened to have Johnny Irwin
arrested if he returned to the building. Id. Plaintiffs contend that they have
not retrieved their personal property. Id. at ¶ 44.
Plaintiffs’ complaint alleges twelve causes of action: Count I, claim
and delivery; Count II, conversion; Count III, trespass to chattels; Count IV,
violation of M.C.L.A. 600.2918 (anti-lockout statute); Count V, unjust
enrichment; Count VI, fraud; Count VII, silent fraud; Count VIII, negligent
misrepresentation; Count IX, breach of contract; Count X, constructive
trust; Count XI, tortious interference with business relationship; and Count
XII, Fourth and Fourteenth Amendment violations (42 U.S.C. § 1983).
Although the complaint often does not differentiate among the defendants,
the parties appear to agree that the only count applicable to Officer Theut,
the 3rd Precinct, and the City of Detroit is Count XII.
LAW AND ANALYSIS
I.

Standard of Review
Defendants Officer Theut, the 3rd Precinct, and the City of Detroit

seek judgment on the pleadings pursuant to Federal Rule of Civil
Procedure 12(c). The court reviews a motion brought pursuant to Rule
12(c) under the same standard as a motion brought pursuant to Rule
12(b)(6). Lindsay v. Yates, 498 F.3d 434, 438 (6th Cir. 2007). In doing so,
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the court construes the complaint “in the light most favorable to the
plaintiffs, accept[s] all of the complaint's factual allegations as true, and
decide[s] whether the plaintiffs can prove any set of facts in support of their
claims that would entitle them to relief.” Id. Although this standard does not
require “detailed factual allegations,@ it does require more than Alabels and
conclusions@ or Aa formulaic recitation of the elements of a cause of action.@
Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). The plaintiff
must allege facts that, if accepted as true, are sufficient Ato raise a right to
relief above the speculative level@ and to Astate a claim to relief that is
plausible on its face.@ Id. at 570. See also Ashcroft v. Iqbal, 129 S.Ct.
1937, 1949-50 (2009). AA claim has facial plausibility when the plaintiff
pleads factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged.@ Id. at
1949.
The court notes that Defendants attached Plaintiffs’ discovery
responses to their reply brief. Plaintiffs have filed a motion to exclude
these materials. (Doc. 29) The court does not consider materials outside
the pleadings in the context of a Rule 12(c) motion. Tackett v. M & G
Polymers, USA, LLC, 561 F.3d 478, 487 (6th Cir. 2009). Although the
court may convert Defendants’ Rule 12(c) motion into a Rule 56 motion,
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this option “should be exercised with great caution and attention to the
parties’ procedural rights.” Id. (citation omitted). See also Fed. R. Civ. P.
12(d). Plaintiffs have not had the opportunity to submit evidence in support
of their response. Moreover, with discovery in its early stages, a Rule 56
motion is premature. Accordingly, the court declines to convert
Defendants’ 12(c) motion to a Rule 56 motion. The court will grant
Plaintiffs’ motion to exclude documentary evidence.
II.

Officer Theut – Qualified Immunity
Plaintiffs allege that Officer Theut violated their Fourth and

Fourteenth Amendment rights, including their rights to procedural and
substantive due process. Compl. at ¶ 109. In order to state a claim under
42 U.S.C. § 1983, “a plaintiff must prove that the defendant, while acting
under color of state law, deprived her of a right secured by the Constitution
or laws of the United States.” Thomas v. Cohen, 304 F.3d 563, 568 (6th
Cir. 2002). Plaintiffs allege that Officer Theut, “acting under color of law,
ejected plaintiffs from premises in which they had a valid and enforceable
right to possession.” Compl. at ¶ 110. Plaintiffs further allege that the
officer “prevented plaintiff[s] from recovering their personal property from
the premises, resulting in government-induced deprivation of personal
property.” Id. at ¶ 111. According to Plaintiffs, Officer Theut “should have
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known that Michigan law requires a court order for evictions to be
executed.” Id. at ¶ 113.
Defendants argue that Officer Theut is entitled to qualified immunity,
which “generally shields state actors from liability under § 1983 based on
their discretionary acts.” Thomas, 304 F.3d at 568. “Qualified immunity
provides police officers ‘breathing room to make reasonable but mistaken
judgments and protects all but the plainly incompetent or those who
knowingly violate the law.’” Mullins v. Cyranek, 805 F.3d 760, 765 (6th Cir.
2015). In determining whether an officer is entitled to qualified immunity,
the court considers “(1) whether the facts, when taken in the light most
favorable to the party asserting the injury, show the officer’s conduct
violated a constitutional right; and (2) whether the right violated was clearly
established such ‘that a reasonable official would understand that what he
is doing violates that right.’” Id. (quoting Saucier v. Katz, 533 U.S. 194, 201202 (2001)).
Defendants have failed to engage in this analysis. Rather, they argue
that Officer Theut’s actions were not “plainly incompetent” and that he did
not knowingly attempt to violate the law. Doc. 23 at 17-18. This is not the
test. The court must instead consider whether Plaintiffs have sufficiently
alleged that Officer Theut violated their rights under the Fourth or
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Fourteenth Amendment and, if so, whether those rights were clearly
established.
The court turns first to Plaintiffs’ Fourteenth Amendment procedural
due process claim. The Due Process Clause of the Fourteenth
Amendment provides that “[n]o State shall deprive . . . any person of life,
liberty, or property, without due process of law.” U.S. Const. amend XIV.
The court analyzes due process claims as follows: “First, the court must
determine whether the interest at stake is a protected liberty or property
right under the Fourteenth Amendment. Only after identifying such a right
do we continue to consider whether the deprivation of that interest
contravened notions of due process.” Thomas, 304 F.3d at 576. Courts
look to state law to determine whether a plaintiff has a protected property
interest. Id.
Defendants do not contest that Plaintiffs have alleged a protected
property interest in the leased building under Michigan law. See generally
M.C.L. § 600.2918 (Michigan anti-lockout statute); Ann Arbor Tenants
Union v. Ann Arbor YMCA, 229 Mich. App. 431, 443 (1998) (“A tenant has
exclusive legal possession and control of the premises against the owner
for the term of his leasehold.”); Merkur Steel Supply Inc. v. City of Detroit,
261 Mich. App. 116, 134 (2004) (“Recovery can be had for the taking of a
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leasehold estate [under Michigan law].”). See also Thomas, 304 F.3d at
576 (“Under Kentucky law, tenants holding leasehold estates have a
recognized property interest.”). Nor do Defendants contest that “[d]ue
process generally requires notice and a hearing prior to eviction.” Thomas,
304 F.3d at 576.
Defendants instead attempt to recharacterize the facts as set forth in
Plaintiffs complaint, claiming “[a]ll that Defendant Theut did was respond to
a dispatch of an alleged robbery and politely and professionally ask the
Plaintiffs to work out the situation with the owner of the property, which the
Plaintiffs agreed to do.” Doc. 26 at 6. According to Plaintiffs, however,
Officer Theut “instructed Mr. Irwin to leave the premises, not take any of his
belongings, and to not return to the premises or he would have to arrest
him.” Compl. at ¶ 34. Johnny Irwin attempted to explain that he had a legal
right to be on the premises, to no avail. Id. at ¶¶ 37-39. At this stage of the
proceedings, the court must view the facts in the light most favorable to the
non-moving party.
Viewing the facts in the light most favorable to Plaintiffs, they allege in
the complaint that they were deprived of a protected property interest
without notice or a hearing when Officer Theut required them to leave their
leased building under threat of arrest. These facts allege a violation of
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Plaintiffs’ right to procedural due process. See Thomas, 304 F.3d at 578
(eviction of residents from shelter without notice or hearing violated right to
procedural due process).
The court next considers whether the contours of this right are
“sufficiently clear that reasonable official would understand that what he is
doing violates that right.” Id. at 580. The Sixth Circuit has long held that it
is clear that tenants are “entitled to pre-eviction judicial oversight in the
absence of emergency circumstances.” Id. According to the complaint,
Plaintiffs attempted to establish that they had a legal right to occupy the
premises. Under similar circumstances, when police officers evicted
residents from a women’s shelter, the Sixth Circuit noted that “officers
never undertook to determine whether Plaintiffs were in fact tenants” and
instead “blindly carried out” the owner’s wishes by removing them from the
building. Id. at 575, 581. Confronted with the plaintiffs’ claims that they
paid rent and were protected by landlord-tenant law, the officers
nonetheless ordered the plaintiffs to leave. Under those circumstances, the
Sixth Circuit found that the officers were not entitled to qualified immunity:
“[w]e find that this case presents more than mere mistaken judgment, but
rather an unwarranted failure to make determinations necessary prior to
taking hasty action.” Id. at 581. In light of Thomas and Plaintiffs’ similar
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allegations, the court finds that Officer Theut is not entitled to qualified
immunity with respect to Plaintiffs’ procedural due process claim at this
stage of the proceedings.
Having determined that Plaintiffs have sufficiently alleged facts that
plausibly state a Fourteenth Amendment violation and survive a motion to
dismiss, the court will not determine whether Plaintiffs have also stated a
claim under the Fourth Amendment. See Compl. at ¶ 111 (alleging Officer
Theut “prevented plaintiff[s] from recovering their personal property from
the premises, resulting in a government-induced deprivation of personal
property.”) Neither party has engaged in a proper analysis of this issue,
which requires an assessment of whether Defendant unreasonably seized
Plaintiffs’ property in violation of their clearly established Fourth
Amendment rights. See Thomas, 304 F.3d at 569-75, 582-83. At this
stage, the parties have not developed the record sufficiently for the court to
make this determination. See generally Wesley v. Campbell, 779 F.3d 421,
433-34 (6th Cir. 2015) (“[I]t is generally inappropriate for a district court to
grant a 12(b)(6) motion to dismiss on the basis of qualified immunity.
Although an officer's ‘entitle[ment] to qualified immunity is a threshold
question to be resolved at the earliest possible point,’ that point is usually
summary judgment and not dismissal under Rule 12.”). For these reasons,
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the court will deny Defendants’ motion for judgment on the pleadings as to
Officer Theut.
III.

3rd Precinct of the Detroit Police Department
Defendants seek dismissal of the 3rd Precinct of the Detroit Police

Department because the department is an instrument of the City and not a
separate entity that is capable of being sued under 42 U.S.C. § 1983. See
Boykin v. Van Buren Twp., 479 F.3d 444, 450 (6th Cir. 2007) (“[U]nder
Michigan law, Van Buren Township Police Department is subsumed within
Van Buren Township as a municipal entity to be sued under § 1983, and
thus the Police Department was improperly included as a separate
defendant in Boykin's suit.”). Plaintiffs agree that the 3rd Precinct should be
dismissed, but seek dismissal without prejudice. Finding no authority for
this request, the court will dismiss the 3rd Precinct, which is not an entity
amenable to suit, with prejudice.
IV.

City of Detroit – Municipal Liability
Defendants contend that Plaintiffs have not sufficiently pleaded a

municipal liability claim under § 1983 against the City of Detroit. “[A]
municipality may be held liable under § 1983 only where its policy or
custom causes the constitutional violation in question.” Miller v. Calhoun
Cty., 408 F.3d 803, 813 (6th Cir. 2005). In support of their municipal
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liability claim, Plaintiffs allege that they contacted the 3rd Precinct in an
attempt to prevent Officer Theut from evicting them, but “the 3rd precinct did
not correct the situation.” Compl. at ¶ 40-42. The complaint further alleges
that the “City of Detroit is specifically responsible for the oversight of the 3rd
Precinct and Officer Jacob [sic] Theut.” Id. at ¶ 42. Plaintiffs essentially
allege liability based upon respondeat superior, a theory that does not
support municipal liability under § 1983. Miller, 408 F.3d at 813 (“The
statute . . . does not permit a municipal entity to incur liability under a theory
of respondeat superior.”). Plaintiffs have not alleged a policy or custom
that was the moving force behind the alleged constitutional violation.
Although Plaintiffs allege that the City of Detroit “authorized, tolerated,
ratified, permitted, or acquiesced in the creation of policies, practices, and
customs, establishing a de facto policy of deliberate indifference to
individuals such as plaintiffs,” such conclusory allegations are insufficient to
state a claim. See Compl. at ¶ 119. Therefore, the court will grant
Defendants’ motion for judgment on the pleadings in favor of the City of
Detroit.
V.

Supplemental Jurisdiction over State Claims
The sole remaining federal claims are the constitutional claims

against Officer Theut in Count XII. The bulk of the complaint – Counts I
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through XI – concerns the landlord-tenant contract and property dispute
between Plaintiffs and Defendants Casey’s Pub, Inc., Kimberly Powers,
and Andrea Huizar. The court has original jurisdiction over the federal
claims in Count XII pursuant to 28 U.S.C. § 1331, and may exercise
supplemental jurisdiction over the eleven state causes of action pursuant to
28 U.S.C. § 1367(a). Defendants Powers, Huizar, and Casey’s Pub have
filed a counterclaim against Plaintiffs for breach of contract and “waste”
under M.C.L. § 600.2919(2), over which the court may also exercise
supplemental jurisdiction pursuant to § 1367(a). See 28 U.S.C. § 1367(a).
A district court may decline to exercise supplemental jurisdiction
pursuant to § 1367(c)(2) if “the [state] claim substantially predominates
over the claim or claims over which the district court has original
jurisdiction.” 28 U.S.C. § 1367(c)(2). When “the state issues substantially
predominate, whether in terms of proof, of the scope of the issues raised,
or of the comprehensiveness of the remedy sought, the state claims may
be dismissed without prejudice and left for resolution to state tribunals.”
United Mine Workers of Am. v. Gibbs, 383 U.S. 715, 726–27 (1966). State
claims “substantially predominate” when “a state claim constitutes the real
body of a case, to which the federal claim is only an appendage.” Id. In
other words, a state claim substantially predominates “where permitting
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litigation of all claims in the district court can accurately be described as
allowing a federal tail to wag what is in substance a state dog.” De Asencio
v. Tyson Foods, Inc., 342 F.3d 301, 309 (3d Cir. 2003).
In this case, Plaintiffs’ state claims – including breach of contract,
fraud, conversion, and tortious interference with a business relationship –
rely upon wholly different factual allegations and legal standards than
Plaintiffs’ federal claim against Officer Theut. Likewise, Defendants’
counterclaim for breach of contract and waste arises out of the same facts
as Plaintiffs’ state claims. These state claims require elements of proof
distinct from Plaintiffs’ federal claim and substantially expand this suit
beyond what is necessary to resolve the federal claim. Under these
circumstances, the court will decline to exercise supplemental jurisdiction
over Plaintiffs’ state law claims in Counts I through XI, as well as
Defendants’ counterclaim. See, e.g., Michigan Paralyzed Veterans of Am.
v. Charter Twp. of Oakland, Mich., 2015 WL 4078142 at *5 (E.D. Mich. July
2, 2015) (“[D]ismissal is appropriate where the state law claims will either
require elements of proof distinct from the federal claim, or cause a
substantial expansion of the suit beyond that necessary and relevant to the
federal claim.”).

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CONCLUSION
Therefore, IT IS HEREBY ORDERED that Defendants’ motion for
judgment on the pleadings (Doc. 23) is GRANTED IN PART as to the City
of Detroit and the 3rd Precinct and DENIED IN PART as to Justin Theut,
consistent with this opinion and order.
IT IS FUTHER ORDERED that Plaintiffs’ motion to exclude
documentary evidence (Doc. 29) is GRANTED.
IT IS FURTHER ORDERED that Counts I through XI of Plaintiffs’
complaint and Defendants’ counterclaim are REMANDED to Wayne
County Circuit Court.
Dated: October 2 , 2018
s/George Caram Steeh
GEORGE CARAM STEEH
UNITED STATES DISTRICT JUDGE

CERTIFICATE OF SERVICE
Copies of this Order were served upon attorneys of record
on October 2 , 2018, by electronic and/or ordinary mail.
s/Marcia Beauchemin
Deputy Clerk

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