Lifestyle Ventures, LLC v. County of Clackamas et al

Filing 46

ORDER: The Court ADOPTS Magistrate Judge Beckerman's Findings and Recommendation 34 and, therefore, GRANTS Plaintiff's own Motion to Dismiss the First and Second Claims; DENIES as moot Defendants' Motion 18 to Dismiss Plain tiff's Complaint for lack of jurisdiction; DENIES Defendants' Motion 18 to Dismiss Plaintiff's Third Claim; GRANTS without prejudice Defendants' Motion 18 to Dismiss Plaintiff's Fourth Claim; and GRANTS Plaintiff leave to amend its Complaint only as to the Fourth Claim for negligence by a date to be set by the Magistrate Judge. IT IS SO ORDERED. Signed on 8/4/2016 by Judge Anna J. Brown. (gw)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON

LIFESTYLE VENTURES, LLC,
an Oregon Limited Liability
Company,

3:15-CV-01291-SB
ORDER

Plaintiff,
v.
COUNTY OF CLACKAMAS, MICHAEL
MCALLISTER, and REBECCA CENIGA,
individually and in their capacity
as employees of the Clackamas
County Planning Division,
Defendants.

BROWN, Judge.
Magistrate Judge Stacie Beckerman issued Findings and
Recommendation (#34) on May 18, 2016, in which she recommends (1)
the Court dismiss Plaintiff’s First and Second Claims on
Plaintiff’s own Motion,1 (2) deny as moot Defendants'

1

Plaintiff voluntarily withdrew its First and Second Claims
as stated in its Opposition (#23) to Defendants’ Motion to
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Motion (#18) to Dismiss Plaintiff’s Complaint for lack of
jurisdiction,2 and (3) grant in part and deny in part Defendants’
Motion (#18) to Dismiss Plaintiff’s Third and Fourth Claims for
failure to state a claim.

Defendants filed timely Objections as

to that part of the Findings and Recommendation in which the
Magistrate Judge denied Defendants’ Motion (#18) to Dismiss as to
Plaintiff’s Third Claim and granted Plaintiff leave to amend its
Complaint as to its Fourth Claim.

The matter is now before this

Court pursuant to 28 U.S.C. § 636(b)(1) and Federal Rule of Civil
Procedure 72(b).
When any party objects to any portion of the Magistrate
Judge's Findings and Recommendation, the district court must make
a de novo determination of that portion of the Magistrate Judge's
report.

28 U.S.C. § 636(b)(1).

See also Dawson v. Marshall, 561

F.3d 930, 932 (9th Cir. 2009); United States v. Reyna-Tapia, 328
F.3d 1114, 1121 (9th Cir. 2003)(en banc).

DISCUSSION
In its Third Claim Plaintiff alleges Defendants violated

Dismiss.
2

In a Status Report (#32) filed April 25, 2016, Plaintiff
advised the Magistrate Judge that Plaintiff had dismissed its
appeal to the Oregon Land Use Board of Appeals and that
Defendants’ Motion to Dismiss for lack of jurisdiction was now
moot. In correspondence to the Magistrate Judge, Defendants
agreed with Plaintiff.
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Plaintiff’s right to equal protection under the United States
Constitution and, as a result, Plaintiff seeks recovery pursuant
to 42 U.S.C. § 1983.

In its Fourth Claim Plaintiff alleges

common-law negligence in connection with Defendants’ refusal to
permit the development of a building lot (Lot 4200) in Clackamas
County.

Defendants move to dismiss both of these claims for

failure to state a claim pursuant to Federal Rule of Civil
Procedure 12(b)(6) on the basis that judicial estoppel bars
Plaintiff’s Third Claim and Plaintiff’s allegations do not
support its Fourth Claim for negligence.
The development of Lot 4200 is at the heart of this dispute.
Lot 4200 is located within the boundaries of a Special Flood
Hazard Area (SFHA) in the Sandy/Salmon River Principal River
Conservation Area.

The development of property within the SFHA

depends in part on whether the property is in a regulated
floodplain.

If property is below the Base Flood Elevation (BFE),

it is within a regulated floodplain where a Floodplain
Development Permit (FDP) is required for most developments.
Plaintiff alleges Lot 4200 is above the BFE, and, therefore,
Plaintiff is not required to obtain an FDP prior to development.
In addition, Plaintiff contends Defendants violated Plaintiff’s
equal-protection rights by imposing requirements on Plaintiff
that were not imposed on other developers, including Defendants’
refusal to accept BFE certificates from professional land

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surveyors showing Lot 4200 is above BFE and requiring Plaintiff
to obtain an FDP despite the fact that Lot 4200 is above BFE
according to those surveys.

Plaintiff also contends Defendants’

conduct in improperly enforcing zoning regulations negligently
caused a foreseeable risk of harm to Plaintiff.
The Magistrate Judge recommends this Court deny Defendants’
Motion to Dismiss Plaintiff’s Third Claim (brought under § 1983)
on the ground that the statements made in other litigation by Kip
O’Connor (the previous owner of Lot 4200 and principal of
Plaintiff) to the effect that Lot 4200 is located within the
regulated floodplain do not trigger judicial estoppel for the
reasons set out below and, therefore, do not bar Plaintiff’s
Third Claim.

Defendants object to the Magistrate Judge’s

recommendation.
The Magistrate Judge also recommends the Court grant
Defendants’ Motion to Dismiss Plaintiff’s Fourth Claim on the
ground that a common-law negligence claim may not be based on
intentional, willful, or malicious misconduct.

The Magistrate

Judge, however, recommends this Court grant Plaintiff leave to
amend its Fourth Claim for negligence to cure its pleading
deficiencies.

Defendants object to the Magistrate Judge’s

recommendation to allow Plaintiff to amend its Fourth Claim on
the ground that any amendment would be futile because Plaintiff’s
Fourth Claim is improperly based on the same operative facts as

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Plaintiff’s Third Claim brought under § 1983 regardless how
Plaintiff’s Fourth Claim is characterized.
I.

Plaintiff’s Third Claim
A.

Judicial Estoppel

Defendants argue judicial estoppel bars Plaintiff’s Third
Claim in which Plaintiff contends Lot 4200 is not located within
a regulated floodplain.

Defendants assert Kip O’Connor stated in

O’Connor v. County of Clackamas3 before District Court Judge
Michael Simon that Lot 4200 is within a regulated floodplain and
Judge Simon, in granting summary judgment for the defendant,
agreed.

See Opin. and Order (#144)(issued by J. Simon on

July 22, 2013).

Plaintiff, however, contends judicial estoppel

does not apply because Plaintiff’s allegations in its Complaint
are not, in fact, inconsistent with O’Connor’s statements in the
other action.
The Magistrate Judge concluded even though the two factual
allegations facially appear to contradict one another because Lot
4200 is apparently mapped as being in a regulated floodplain,
both O’Connor and Plaintiff have consistently challenged the
mapping of Lot 4200.

The Magistrate Judge pointed out that “the

parties have been litigating for years the issue whether Lots
4200 and 4400 are appropriately mapped within a regulated
3

The Magistrate Judge took judicial notice of the complaint
in O’Connor v. County of Clackamas, No. 3:11-cv-01297-SI, 2013 WL
3818143 (D. Or. July 22, 2013).
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floodplain.”

Thus, the Magistrate Judge concluded Plaintiff’s

position is not “clearly inconsistent” with O’Connor’s position.
Judicial estoppel is an equitable doctrine that a court may
invoke in its discretion to prevent a litigant from taking
contradictory positions.

Ryan v. Editions Ltd. W., Inc., 786

F.3d 754, 763 (9th Cir. 2015).

Although judicial estoppel

generally “bars only inconsistent positions taken by the same
party in two different matters,” courts also have invoked the
doctrine to bar parties who stand in privity to another litigant.
Milton H. Greene Archives, Inc. v. Marilyn Monroe LLC, 692 F.3d
983, 996-998 (9th Cir. 2012).
In New Hampshire v. Maine the Supreme Court set forth a
three-part analysis to determine whether judicial estoppel
applies:

(1) A party’s later position must be “clearly

inconsistent” with its earlier position; (2) whether the party
succeeded in persuading the court in the earlier case to accept
that party’s earlier position, which would result in judicial
acceptance of an inconsistent position in a later proceeding and
create “the perception that either the first or the second court
was misled”; and (3) whether the party seeking to assert an
inconsistent position “would derive an unfair advantage or impose
an unfair detriment on the opposing party if not estopped.”

532

U.S 742, 750-51 (2001).
In this case Plaintiff alleges “Lot 4200 is above BFE” and

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that Defendants “have failed and refused to accept . . . valid
and accurate BFE certificates from licenses surveyors that Lot
4200 is above BFE, and therefore not in a floodplain or
floodway.”

Compl. At ¶¶ 10 and 33.

Similarly in O’Connor v.

County of Clackamas, O’Connor alleged “Plaintiff verified the BFE
information, by obtaining elevations (sic) certificates from
professional land surveyors, which indicated the homes were
buildable because they were to be located above the BFE.”
O'Connor Compl. at ¶ 24.
The Magistrate Judge ultimately declined to invoke judicial
estoppel under these circumstances and concluded, as noted, that
Plaintiff’s “position in this case is not clearly inconsistent
with O’Connor’s position” in the earlier case (emphasis added),
that Plaintiff “has not created a perception that [Plaintiff] is
seeking to mislead this Court,” and that Plaintiff “does not
derive an unfair advantage by its pleading language.”

The

Magistrate Judge, accordingly, recommended this Court deny
Defendants’ Motion to Dismiss as to Plaintiff’s Third Claim.
On this record the Court does not find any error in the
Magistrate Judge’s Findings and Recommendation and, accordingly,
adopts the recommendation to deny Defendants’ Motion to Dismiss
Plaintiff’s Third Claim on the ground of judicial estoppel.
B.

Collateral Estoppel

In their Objections Defendants raise for the first time in
7 - ORDER

support of their Motion (#18) to Dismiss the applicability of
collateral estoppel.

Defendants argue the court’s earlier

finding on summary judgment in the O’Connor case that Lot 4200
was within a regulated floodplain triggers collateral estoppel,
which precludes relitigation of that issue in this case and
thereby bars Plaintiff’s claim.

Plaintiff contends the issue of

collateral estoppel was not raised in Defendants’ Motion; was not
addressed by the Magistrate Judge in the Findings and
Recommendation; and, therefore, should not be considered by this
Court.
The Court agrees and concludes on this record that because
the issue of collateral estoppel was not addressed to the
Magistrate Judge, it is not appropriately before this Court.
II.

Plaintiff’s Fourth Claim
Defendants move to dismiss Plaintiff’s Fourth Claim for

negligence on the ground that Plaintiff has only alleged
Defendants acted intentionally, willfully, and maliciously and
has not alleged facts to support a claim that Defendants’ conduct
was negligent.

The Magistrate Judge agreed and recommends this

Court dismiss Plaintiff’s Fourth Claim for negligence without
prejudice and grant Plaintiff leave to amend its Fourth Claim.
Defendants, however, object to the Magistrate Judge’s
recommendation that this Court grant Plaintiff leave to amend its
Fourth Claim for negligence because that claim is based on the

8 - ORDER

same operative facts as Plaintiff’s § 1983 claim, and, according
to Defendants, the same operative facts cannot support both a
claim for equal-protection violations and a claim for negligence.
Defendants, however, acknowledge trial judges in this District
have concluded “at the initial pleading stage a plaintiff may
base claims of negligence under state law and claims of
constitutional violations under 42 U.S.C. § 1983 on the same
facts.”

See, e.g., Rodriguez v. City of Portland, No. 3:09-cv-

00850-KI, 209 WL 3518004, at *2 (D. Or. Oct. 21, 2009).
Nevertheless, Defendants contend Plaintiff’s reliance on the same
operative facts for both Claim Three and Claim Four constitutes
alternative pleading, and although alternative pleading applies
when “neutral facts, capable of alternative interpretations, may
be presented,” it does not allow “the impermissible pleading of
contradictory statements of fact.”
The Magistrate Judge, however, did not find Plaintiff pled
contradictory statements of fact but merely concluded it was
improper for Plaintiff to incorporate allegations of Defendants’
intentional misconduct into its Fourth Claim for purposes of
pleading a negligence claim.

The Magistrate Judge, therefore,

recommended in the exercise of discretion under Federal Rule of
Civil Procedure 15 that the Court allow Plaintiff to proceed at
the pleading stage with its negligence claim.

This Court agrees.

In summary, this Court has carefully considered Defendants’

9 - ORDER

Objections and concludes they do not provide a basis to modify
the Findings and Recommendation.

The Court also has reviewed the

pertinent portions of the record de novo and does not find any
error in the Magistrate Judge's Findings and Recommendation.

CONCLUSION
The Court ADOPTS Magistrate Judge Beckerman’s Findings and
Recommendation (#34) and, therefore, GRANTS Plaintiff’s own
Motion to Dismiss the First and Second Claims; DENIES as moot
Defendants' Motion (#18) to Dismiss Plaintiff’s Complaint for
lack of jurisdiction; DENIES Defendants’ Motion (#18) to Dismiss
Plaintiff’s Third Claim; GRANTS without prejudice Defendants’
Motion (#18) to Dismiss Plaintiff’s Fourth Claim; and GRANTS
Plaintiff leave to amend its Complaint only as to the Fourth
Claim for negligence by a date to be set by the Magistrate Judge.
IT IS SO ORDERED.
DATED this 4th day of August, 2016.

/s/ Anna J. Brown
ANNA J. BROWN
United States District Judge

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