Joseph Hardesty v. Sacramento County ( 2020 )

NOT FOR PUBLICATION FILED
UNITED STATES COURT OF APPEALS AUG 19 2020
MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
JOSEPH HARDESTY; et al., Nos. 18-15772, 18-15773
Plaintiffs-Appellees, D.C. Nos.
2:10-cv-02414-KJM-KJN
v. 2:12-cv-02457-KJM-KJN
SACRAMENTO COUNTY,
MEMORANDUM*
Defendant-Appellant,
and
ROGER DICKINSON; et al.,
Defendants.
Appeal from the United States District Court
for the Eastern District of California
Kimberly J. Mueller, Chief District Judge, Presiding
Argued and Submitted January 24, 2020
San Francisco, California
Before: W. FLETCHER and R. NELSON, Circuit Judges, and SESSIONS,**
District Judge.
Partial Concurrence and Partial Dissent by Judge R. NELSON
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
**
The Honorable William K. Sessions III, United States District Judge
for the District of Vermont, sitting by designation.
Defendant Sacramento County (“County”) and individual defendants Roger
Dickinson, Jeff Gamel, and Robert Sherry (collectively “Individual Defendants”)
challenge the district court’s denial of their renewed motion for judgment as a
matter of law and motion for a new trial. The jury found Defendants liable for
violating Plaintiffs’ substantive due process rights and awarded $105 million in
compensatory damages against the County and Individual Defendants jointly and
severally, and $1,775,000 in punitive damages against the Individual Defendants.
Defendants argue the verdict is not supported by substantial evidence, the court
erred by failing to offer a proposed jury instruction regarding campaign finance,
the damages are excessive, and the Individual Defendants are entitled to immunity.
Because the parties are familiar with the facts, we do not recount them here. We
reverse the judgment as it applies to the Individual Defendants because they are
entitled to immunity, affirm the judgment of liability against the County, and
remand the damages against the County as excessive.
We review de novo the denial of a Fed. R. Civ. P. 50 motion for judgment.
Kuntz v. Lamar Corp., 385 F.3d 1177, 1185 n.8. (9th Cir. 2004). We review that
motion’s attack on the jury verdict for substantial evidence. Gilbrook v. City of
Westminster, 177 F.3d 839, 856 (9th Cir. 1999). Arguments that were not properly
raised in a Rule 50(a) motion are reviewed only for plain error. EEOC v. Go
Daddy Software, Inc., 581 F.3d 951, 961 (9th Cir. 2009). We review the district
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court’s formulation of the jury instructions for abuse of discretion. Oviatt v.
Pearce, 954 F.2d 1470, 1481 (9th Cir. 1992).
1. Defendant Roger Dickinson is entitled to absolute immunity because
the functions he performed were quasi-judicial. The Supreme Court “has outlined
a list of factors to consider in determining whether an official’s functions are quasi-
judicial in nature: (1) the need to insulate the official from harassment or
intimidation; (2) the presence of procedural safeguards to reduce unconstitutional
conduct; (3) insulation from political influence; (4) the importance of precedent in
the official’s decision; (5) the adversar[ial] nature of the process; and (6) the
correctability of error on appeal.” Miller v. Davis, 521 F.3d 1142, 1145 (9th Cir.
2008). Dickinson voted against the Schneiders’ appeal at a formal adjudicatory
hearing at which counsel was available to both sides on a transcribed record
subject to judicial review. His role was “functionally comparable” to one of a
judicial nature. Moreover, the factors weigh in favor of him being entitled to
absolute immunity. Id. For instance, there is a need to insulate officials making
adjudicatory decisions from harassment and intimidation, Dickinson was just one
of a panel that voted and so there were other procedural safeguards checking
unconstitutional conduct and, as this case shows, the process is adversarial with
opposing parties presenting strong and detailed arguments, through legal counsel,
to support their positions.
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2. All three Individual Defendants are entitled to qualified immunity as
to the Hardestys’ claims. No Ninth Circuit or Supreme Court case clearly
established that the Individual Defendants’ enforcement actions were a violation of
the Hardesty’s due process rights to engage in their chosen profession. See
Martinez v. City of Clovis, 943 F.3d 1260, 1275 (9th Cir. 2019) (internal quotation
marks omitted). And all three Individual Defendants are entitled to qualified
immunity as to the Schneiders’ claims because their actions did not violate a
clearly established constitutional right that any reasonable officer would have
understood he was violating. Id. at 1275. Plaintiffs claim the unlawfulness of the
Individual Defendants’ actions was clearly established because they were only
permitted to “order the operator to restrict the operation to its former level” if it
appeared that the operation was expanding beyond the vested right. Hansen
Brothers Enterprises, Inc. v. Board of Supervisors, 12 Cal.4th 533, 575 (Cal.
1996). But the record shows that the Individual Defendants took actions based on
multiple complaints that the Hardesty mine had expanded significantly. It was
therefore reasonable for the officials to believe that the Schneiders had exceeded
the bounds of their vested right and that their actions did not undermine the
original vested right.
3. Because the County did not raise its argument that the Hardestys
failed to support their chosen profession theory with evidence until its Rule 50(b)
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motion, “we are limited to reviewing the jury’s verdict for plain error, and should
reverse only if such plain error would result in a manifest miscarriage of justice.”
See Go Daddy, 581 F.3d at 961. Our inquiry is limited to “whether there was any
evidence to support the verdict. Id. at 961-62. Here, the jury was presented with
evidence that the County ordered the Hardesty mining operation to shut down; the
County did so based on impermissible political motivations; and because of the
County’s actions, there was not “much of anything left of the Hardesty Sand and
Gravel Company” and as of trial the Hardestys had not any income for seven or
eight years. Based on that evidence, the jury could conclude the County acted
arbitrarily and unreasonably to deprive the Hardestys of their chosen occupation.
See Benigni v. Hemet, 879 F.2d 473, 487 (9th Cir. 1988); Chalmers v. City of Los
Angeles, 762 F.2d 753,758 (9th Cir. 1985). Accordingly, there was no plain error
in the jury’s finding of liability against the County as to the Hardesty plaintiffs.
4. There is substantial evidence in the record to support the jury’s verdict
that the Schneiders had a vested right which the County abrogated in violation of
substantive due process. The jury was presented with evidence that the Schneiders
had a vested right and that the County acted arbitrarily and unreasonably in
ordering them to cease mining on their property, thus depriving them of their
vested right. We affirm the jury’s finding of liability against the County as to the
Hardesty plaintiffs.
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5. The Hardestys’ damages award is reversed and remanded as
excessive. The district court abused its discretion by failing to consider
Defendants’ argument that the damages were excessive. “A district court’s failure
to exercise discretion constitutes an abuse of discretion.” Taylor v. Soc. Sec.
Admin., 842 F.2d 232, 233 (9th Cir. 1988). The award is excessive because it was
calculated based on the wrong theory of recovery. The Hardestys chose to pursue
a theory of recovery based on their loss of an ability to practice a profession as
individuals. The jury’s award of $75 million was based on the business’s
estimated value if it continued to operate between 75 and 100 more years. The
value of a business, on the one hand, and the damages resulting from an
individual’s inability to practice his or her profession, on the other, are distinct
concepts. Because there was no substantial evidence by which a jury could
conclude that the Hardestys themselves would continue working for over 75 years,
the damages were excessive.
6. The Schneiders’ damages award is also reversed and remanded as
excessive. Lost profits were the wrong measure of damages for their due process
claim. The jury awarded damages for the Schneiders’ substantive due process
claim based on the total value of aggregate ore on their property rather than based
on the diminution in value of the property associated with increased regulatory
costs. The jury did not have evidence upon which it could have concluded that the
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Schneiders lost the entire value of the ore on the land that they continued to own.
Additionally, the jury failed to account for mitigation in the form of the
Schneiders’ recuperation of the value of the gravel before calculating damages. A
reasonable jury could not include the value of the gravel in the award while
accounting for mitigation.
7. The district court did not abuse its discretion in failing to offer the
County’s proposed jury instruction regarding campaign contributions. The district
court accurately stated the law when it informed the jury that campaign
contributions are constitutionally protected free speech. The trial court did not
abuse its discretion by declining to give the proposed jury instruction as
Defendants formulated it.
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED. THE
PARTIES ARE TO BEAR THEIR OWN COSTS.
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FILED
AUG 19 2020
Hardesty v. Sacramento County, 18-15772
MOLLY C. DWYER, CLERK
R. NELSON, Circuit Judge, concurring in part and dissenting in part: U.S. COURT OF APPEALS
I concur in the panel’s determinations that the Individual Defendants are
entitled to qualified immunity as to the Hardestys’ claims; that the County is liable
for its conduct as to both the Hardestys and the Schneiders; that the district court
abused its discretion by failing to consider Defendants’ argument that the damages
were excessive; that the Schneiders’ damages were excessive; and that the district
court did not err in failing to offer the County’s proposed jury instruction regarding
campaign contributions. But I dissent from the panel’s holdings that Dickinson is
entitled to absolute immunity; that the Individual Defendants are entitled to
qualified immunity as to the Schneiders’ claims; and that the Hardestys’ damages
were based on the wrong theory of recovery.
First, I would hold Dickinson is not entitled to absolute immunity because
his position was not immune from political influence. The ultimate question is
whether his role was “functionally comparable” to that of a judge. Miller v. Davis,
521 F.3d 1142, 1145 (9th Cir. 2008). As the majority notes, some of the factors
identified in Miller are present in this case. But the Supreme Court has
emphasized that whether a decisionmaker “exercises his independent judgment on
the evidence before him, free from pressures by the parties or other officials within
the agency” is “[m]ore important[]” than whether the powers the decisionmaker
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exercises are similar to those of a judge. See Butz v. Economou, 438 U.S. 478, 513
(1978).
Far from being insulated from political influence, Dickinson was held liable
precisely on the theory that he violated Plaintiffs’ substantive due process rights to
benefit an influential competitor. He was an elected official who received
campaign contributions and gifts from a powerful competing mine. That same
competing mine argued before the Board of Supervisors over which Dickinson
presided that the Schneiders never had a vested right, and may have coordinated
with the County to draft findings of fact for the Board’s approval after the hearing.
And Dickinson received campaign contributions from that competitor in the two-
week period between the Board’s tentative decision to deny the appeal and its final
decision. Granting absolute immunity under these circumstances shields officials
from liability based on supposed independence when the jury found, and
substantial evidence supports, precisely the opposite: Dickinson voted to deprive
the Schneiders of their vested right to appease a more powerful competitor.
Second, I would hold the Individual Defendants are not entitled to qualified
immunity as to the Schneiders’ substantive due process claim. The law was clearly
established as of 1996 that the Schneiders had a right to mine on their property.
Hansen Bros. Enters., v. Bd. of Supervisors, 907 P.2d 1324, 1335 (Cal. 1996). The
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County recognized that vested right on multiple occasions before the Schneiders’
competitors began to complain.
It was clearly established that the Individual Defendants’ conduct violated
that vested right. They did not follow Hansen’s clear instruction that, even if the
County believed that the Schneiders may have been operating beyond the scope of
the vested right, the only proper action would be to “order the operator to restrict
the operation to its former level, and seek an injunction if the owner does not
obey.” Hansen, 907 P.2d at 1351. Instead, the Defendants forced the Schneiders
to shut down all operations, in violation of the Schneiders’ clearly established
right. That action was clearly established as arbitrary and unreasonable by
Hansen. I would therefore hold the Individual Defendants are not entitled to
qualified immunity as to the Schneiders’ claims.
Finally, I concur with the majority’s holding that the district court abused its
discretion by failing to consider Defendants’ argument that the Hardestys’
damages were excessive. But rather than limiting its holding to the arguments
presented by the parties, the majority holds sua sponte that the award is excessive
because it was based on the wrong theory of recovery. That argument was not
made before this panel, let alone before the district court. This Court may review a
waived argument in limited circumstances which are not present here. See Bolker
v. Comm’r of Internal Revenue, 760 F.2d 1039, 1042 (9th Cir. 1985) (quotation
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marks and citation omitted). As a unanimous Supreme Court reminded our Circuit
earlier this year, “[i]n our adversarial system of adjudication, we follow the
principle of party presentation . . . ‘we rely on the parties to frame the issues for
decision and assign to courts the role of neutral arbiter of matters the parties
present.” United States v. Sineneng-Smith, 140 S. Ct. 1575, 1579 (quoting
Greenlaw v. United States, 554 U. S. 237 (2008)). In short, the Court reminded us,
we “do not, or should not, sally forth each day looking for wrongs to right. [We]
wait for cases to come to [us], and when [cases arise, we] normally decide only
questions presented by the parties.’” Id. (quoting United States v. Samuels, 808 F.
2d 1298, 1301 (8th Cir.1987) (Arnold, J., concurring in denial of reh’g en banc)). I
therefore do not join the majority’s holding that the Hardestys’ damages were
based on the wrong theory of recovery when Defendants did not at any time
present that argument.
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