California Chamber of Commerce v. Bonta ( 2020 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 CALIFORNIA CHAMBER OF No. 2:19-CV-02019-KJM-EFB COMMERCE, 12 Plaintiff, 13 ORDER v. 14 XAVIER BECERRA, 15 Defendant, 16 and COUNCIL FOR EDUCATION AND 17 RESEARCH ON TOXICS, 18 Defendant-Intervenor. 19 20 21 Plaintiff California Chamber of Commerce brings this suit challenging California’s 22 Safe Drinking Water and Toxic Enforcement Act (Proposition 65) insofar as it requires certain 23 California businesses to post warnings about the presence of acrylamide, a chemical the state has 24 identified as a cancer risk. See Compl. ¶¶ 1–3, ECF No. 1; Becerra Mem. P. & A. (“Becerra 25 MTD”), ECF Nos. 21, at 6. Plaintiff argues the enforcement of the statute with respect to 26 acrylamide violates the First Amendment of the U.S. Constitution and requests declaratory and 27 injunctive relief. Compl. at 20, 22–23. The parties stipulated to allow Council for Education and 28 1 Research on Toxics (CERT) to intervene as a party defendant, ECF No. 28, and the court 2 approved the stipulation, ECF No. 29. 3 Before the court are two motions to dismiss by defendant-intervenor CERT and 4 defendant Becerra (collectively “Defendants”). CERT Mot. (“CERT MTD”), ECF No. 8; 5 Becerra MTD. Becerra also filed a request for judicial notice in conjunction with his motion to 6 dismiss. Req. for Judicial Not., ECF No. 22. Plaintiff has opposed both motions to dismiss. 7 Opp’n to CERT MTD, ECF No. 31; Opp’n to Becerra MTD, ECF No. 30. Defendants replied.1 8 CERT Reply, ECF No. 38; Becerra Reply, ECF No. 39. Given their overlapping subject matter 9 and common objective, the court addresses both motions here, differentiating where necessary. 10 I. DISCUSSION 11 The gravamen of defendants’ motions to dismiss is that the court should dismiss 12 this case in favor of ongoing state proceedings enforcing Proposition 65 with respect to 13 acrylamide against certain members of the California Chamber of Commerce. See CERT MTD at 14 11–13 (citing CERT v. Starbucks, et al., Los Angeles Superior Court Case No. BC435759); 15 Becerra MTD at 6–7 (referring to “multiple pending enforcement proceedings in California state 16 courts”). Specifically, defendant Becerra argues: (1) the court should abstain under the 17 Declaratory Judgment Act, 28 U.S.C. § 2201(a), and Brillhart v. Excess Ins. Co., 316 U.S. 491 18 (1942); and (2) the court should dismiss or stay the action under Colorado River Water 19 Conservation District v. United States, 424 U.S. 800 (1976). See generally Becerra MTD. CERT 20 argues: (1) the court should dismiss the case because it is barred from granting the requested 21 injunction under the Anti-Injunction Act, 28 U.S.C. § 2283; (2) the court should abstain based on 22 the Rooker-Feldman doctrine; (3) the court should abstain based on the Younger abstention 23 doctrine; and (4) the court should dismiss the complaint under Colorado River. See generally 24 CERT MTD. 25 26 1 After filing an oversized brief on reply, CERT filed an ex parte application to file a brief 27 exceeding 10 pages. ECF No. 41. While it is counsel’s responsibility to carefully read and abide by the court’s standing orders, the complexity of the issues presented here warrants the extra 28 pages and the court GRANTS the application retroactively. 1 The court addresses Brillhart abstention and the Anti-Injunction Act below and 2 finds dismissal of plaintiff’s claims is warranted on these grounds without the need to reach 3 defendants’ other arguments at this time. 4 A. Declaratory Judgments Act & Brillhart Abstention2 5 Defendant Becerra argues the court should dismiss this case, because the 6 Declaratory Judgments Act, 28 U.S.C. § 2201, affords the court discretion to abstain from 7 deciding a declaratory judgment action for the “purpose of enhancing ‘judicial economy and 8 cooperative federalism.’” Becerra MTD at 14 (citing R.R. St. & Co. v. Transp. Ins. Co., 656 F.3d 9 966, 975 (9th Cir. 2011)). Because the Declaratory Judgments Act uses permissive language 10 when granting courts jurisdiction to hear declaratory judgment actions, “[a] district court may, in 11 its discretion, decline to hear a declaratory judgment action when a related case is pending in state 12 court,” Scotts Co. LLC v. Seeds, Inc., 688 F.3d 1154, 1158–59 (9th Cir. 2012) (citing Wilton v. 13 Seven Falls Co., 515 U.S. 277, 289 (1995)). See 28 U.S.C. § 2201(a) (stating that federal courts 14 “may declare the rights and other legal relations of any interested party” in a declaratory judgment 15 action (emphasis added)); see also Brillhart, 316 U.S. at 495 (holding federal courts “under no 16 compulsion” to exercise jurisdiction over suits under Declaratory Judgments Act). 17 1. Whether Plaintiff Pleads an “Independent Claim” 18 “[T]his discretionary jurisdictional rule does not apply to ‘[c]laims that exist 19 independent of the request for a declaration.’” Scotts Co. LLC, 688 F.3d at 1158–59 (quoting 20 Snodgrass v. Provident Life & Accident Ins. Co., 147 F.3d 1163, 1167 (9th Cir. 1998)). Where a 21 case involves a claim for declaratory relief under the Declaratory Judgment Act in addition to a 22 claim for monetary or injunctive relief, “[t]he appropriate inquiry . . . is to determine whether 23 there are claims in the case that exist independent of any request for purely declaratory relief, that 24 is, claims that would continue to exist if the request for a declaration simply dropped from the 25 case.” Snodgrass, 147 F.3d at 1167. These “independent” claims are instead evaluated under the 26 27 2 Brillhart abstention is also commonly referred to as Wilton/Brillhart abstention, referring to the complementary case, Wilton v. Seven Falls Co., 515 U.S. 277, 283 (1995). See, 28 e.g., R.R. St. & Co. Inc., 656 F.3d at 975. 1 more stringent Colorado River abstention doctrine, which the court does not reach at this point. 2 Scotts Co. LLC, 688 F.3d at 1158–59 (citation omitted). As a general rule, a court should not 3 decline to entertain a claim for declaratory relief when it is joined with independent claims, unless 4 there is some other basis for abstention. Gov’t Emps. Ins. Co. v. Dizol, 133 F.3d 1220, 1225 (9th 5 Cir. 1998) (en banc) (citation omitted). 6 Here, plaintiff requests declaratory relief as well as “preliminary and permanent 7 injunctions prohibiting Defendant . . . from enforcing or threatening to enforce the Proposition 65 8 warning requirement for cancer with respect to acrylamide in food products intended for human 9 consumption.” Compl. at 22–23. Becerra argues, correctly, that this claim for injunctive relief is 10 not a separate cause of action, but a remedy, and therefore could not survive independently if the 11 declaratory relief claim were dropped from the case. Becerra Reply at 13 (citing Jensen v. Quality 12 Loan Serv. Corp., 702 F. Supp. 2d 1183, 1201 (E.D. Cal. 2010) (“A request for injunctive relief by 13 itself does not state a cause of action.” (citation omitted)). 14 Plaintiff’s complaint brings one “claim for relief” entitled “Violation of the First 15 Amendment to the U.S. Constitution,” Compl. at 20, and cites the Declaratory Judgments Act in its 16 prayer for relief, id. at 22 (citing 28 U.S.C. § 2201). Nowhere in the complaint does plaintiff invoke 17 the federal statute providing a private cause of action for constitutional violations, 42 U.S.C. § 1983, 18 but it does cite 42 U.S.C. § 1988, which authorizes attorneys’ fees in an action under, inter alia, 19 § 1983. Id. at 23. At hearing, however, counsel for plaintiff clarified plaintiff did not intend to 20 bring a claim under § 1983 but could amend its claim to rely on the statute if given the chance to 21 amend.3 As currently pled, however, plaintiff’s complaint does not bring any claims independent 22 of its declaratory relief claim, and the court may decline to hear the declaratory relief claim in its 23 discretion. See 28 U.S.C. § 2201. 24 2. Whether the Court Should Decline to Entertain Plaintiff’s Claims 25 Though the Supreme Court has “not yet delineated “the outer boundaries of the so- 26 called [Brillhart] doctrine,” the Ninth Circuit has generally “allowed district courts broad 27 3 Notably, without a § 1983 claim, the complaint does not provide a basis for awarding 28 fees under § 1988. 1 discretion as long as it furthers the Declaratory Judgment Act’s purpose of enhancing ‘judicial 2 economy and cooperative federalism,’” R.R. St. & Co. Inc. v. Transp. Ins. Co., 656 F.3d at 975 3 (quoting Dizol, 133 F.3d at 1224). Courts generally consider three factors when determining the 4 propriety of entertaining a declaratory judgment action under Brillhart: (1) avoiding “needless 5 determination of state law issues”; (2) discouraging “forum shopping”; and (3) avoiding 6 “duplicative litigation.” Id. (quoting Dizol, 133 F.3d at 1225). Here, because the primary legal 7 question is one of federal law, the latter two factors are most relevant and support dismissal. 8 First, given the timing of plaintiff’s filing, it appears plaintiff seeks to proceed in 9 this federal action as a result of the unfavorable decision of the state court in CERT v. Starbucks. 10 See Becerra MTD at 15. Brillhart’s policy rationale of discouraging forum-shopping applies in 11 precisely this situation, “when a party files a suit in federal court in reaction to a pending state 12 court suit on the same issues, seeking a declaration that would influence the outcome of the state 13 litigation.” Hanover Ins. Co. v. Fremont Bank, 68 F. Supp. 3d 1085, 1111 (N.D. Cal. 2014) 14 (citing Continental Cas. Co. v. Robsac Industries, 947 F.2d 1367, 1371–73 (9th Cir. 1991), 15 overruled on other grounds by Dizol, 133 F.3d at 1220. This is the kind of “reactive declaratory 16 action” federal courts “should generally decline to entertain,” Dizol, 133 F.3d at 1225. 17 Second, plaintiff’s declaratory relief claim would likely be duplicative of claims in 18 the roughly 38 ongoing state court proceedings involving acrylamide and Proposition 65 19 referenced by defendant Becerra. Becerra MTD at 18 (citing Req. for Judicial Not., Ex. 1). As 20 Becerra points out, many of the companies represented by Plaintiff are involved in these state 21 suits, and many have asserted a First Amendment defense, the flip slide of the affirmative First 22 Amendment claim presented here. Id. It is in the interest of judicial economy to avoid 23 unnecessarily deciding questions that are being raised before the state courts. Polido v. State 24 Farm Mut. Auto. Ins. Co., 110 F.3d 1418, 1423 (9th Cir. 1997) (“[T]he dispositive question is not 25 whether the pending state proceeding is ‘parallel,’ but rather, whether there was a procedural 26 vehicle available to the [defendant] in state court to resolve the issues raised in the action filed in 27 federal court.”), overruled on other grounds by Dizol, 133 F.3d at 1227. 28 1 The court’s interest in discouraging forum shopping and avoiding duplicative 2 litigation weighs in favor of declining to entertain plaintiff’s declaratory relief claim. The court 3 here so declines. 4 B. The Anti-Injunction Act 5 Additionally, as CERT argues, the Anti-Injunction Act, 28 U.S.C. § 2283, prevents 6 the court from granting plaintiff’s requested relief, because both the requested injunctive relief 7 and the declaratory relief would have the effect of enjoining a state action. CERT MTD at 14. 8 Therefore, the court must dismiss the claims for failure to state a claim upon which relief can be 9 granted. See Fed. R. Civ. P. 12(b)(6). 10 The federal Anti-Injunction Act forbids a federal district court from “grant[ing] an 11 injunction to stay proceedings in a State court except [1] as expressly authorized by Act of 12 Congress, or [2] where necessary in aid of its jurisdiction, or [3] to protect or effectuate its 13 judgments,” 28 U.S.C. § 2283. The Anti-Injunction Act “is an absolute prohibition against 14 enjoining state court proceedings, unless the injunction falls within one of three specifically 15 defined exceptions.” Negrete v. Allianz Life Ins. Co. of N. Am., 523 F.3d 1091, 1100–01 (9th Cir. 16 2008) (quoting Atl. Coast Line R.R. Co. v. Bhd. of Locomotive Eng’rs, 398 U.S. 281, 286–87 17 (1970)). The Act applies equally to prevent a declaratory judgment if it would have the same 18 effect as an injunction. California v. Randtron, 69 F. Supp. 2d 1264, 1270 n.5 (E.D. Cal. 1999) 19 (“[T]he Anti–Injunction Act applies to declaratory relief if it would have the same effect as an 20 injunction” (citing Texas Employers’ Ins. Ass’n v. Jackson, 862 F.2d 491, 506 (5th Cir.1988)), 21 aff’d sub nom. People of California v. Randtron, 268 F.3d 891 (9th Cir. 2001), opinion amended 22 and superseded on denial of reh’g sub nom. California v. Randtron, 284 F.3d 969 (9th Cir. 2002). 23 However, the Act “does not preclude injunctions against a lawyer’s filing of prospective state 24 court actions.” In re GTI Capital Holdings, LLC, 420 B.R. 1, 11 (Bankr. D. Ariz. 2009) (quoting 25 Newby v. Enron Corp., 302 F.3d 295, 301 (5th Cir. 2002) (emphasis in original)). 26 1. Plaintiff’s Request for Injunctive Relief 27 There is no dispute that none of the three express exceptions to the Act’s 28 prohibition against a federal court’s deciding a case applies here. See CERT MTD at 14; Opp’n 1 to CERT MTD at 12 (omitting any argument regarding exceptions to Act). Rather, plaintiff’s 2 argument against dismissal is twofold: first, plaintiff argues the Anti-Injunction Act is not a 3 jurisdictional statute, and does not set up a threshold bar against this court’s exercising 4 jurisdiction at this stage. Opp’n to CERT MTD at 12. While the Act is in fact not a jurisdictional 5 statute, see Prometheus Dev. Co. v. Everest Properties, 289 F. App’x 211, 212 n.1 (9th Cir. 2008) 6 (citing, inter alia, Smith v. Apple, 264 U.S. 274, 278–79 (1924)), if the Anti-Injunction Act bars 7 the court from granting plaintiff’s requested remedies, it nevertheless warrants a dismissal of the 8 claims under Rule 12(b)(6). See, e.g., David V. ex rel. Ohio Legal Rights Serv. v. Bd. of Trustees 9 of Miami Twp., No. 1:05 CV 714, 2005 WL 3307346, at *5, 8 (S.D. Ohio Dec. 6, 2005) (finding 10 requested injunction would violate Anti-Injunction Act and dismissing injunction claim “for 11 failure to state a claim”). Second, plaintiff argues the Act does not apply to their injunction 12 request, because plaintiff only seeks injunctive relief from future enforcement actions. Opp’n to 13 CERT MTD at 12; see Newby, 302 F.3d at 301 (injunction against prospective state actions not 14 barred by Anti-Injunction Act) (citing Dombrowski v. Pfister, 380 U.S. 479, 485 n.2 (1965)). 15 As currently pled, however, plaintiff’s request for an injunction is not merely 16 prospective. See Compl. at 22–23 (requesting injunction to prohibit defendant and all those in 17 privity defendant from “enforcing or threatening to enforce the Proposition 65 warning 18 requirement . . . with respect to acrylamide in food products intended for human consumption.”). 19 At hearing, plaintiff argued it need not amend its complaint to narrow the scope of the requested 20 injunction, because counsel had stated on the record that plaintiff will not request retroactive 21 injunctive relief, which plaintiff concedes would be barred under the Anti-Injunction Act. The 22 court finds this statement insufficient to obviate the need for amendment. See Hafiz v. Aurora 23 Loan Servs., No. C 09-1963 SI, 2009 WL 2029800, at *4 (N.D. Cal. July 14, 2009) (granting 24 motion to dismiss with leave to amend where plaintiff’s arguments in opposition rendered the 25 scope of her request for injunctive relief unclear). For this additional reason, the court dismisses 26 the First Amendment claim and corresponding request for injunctive relief, while granting 27 plaintiff leave to amend. 28 ///// 1 2. Plaintiff’s Request for Declaratory Relief 2 “The Anti-Injunction Act also applies to declaratory judgments if those judgments 3 have the same effect as an injunction.” Randtron, 284 F.3d at 975; see also Samuels, 401 U.S. at 4 72 (“[O]rdinarily a declaratory judgment will result in precisely the same interference with and 5 disruption of state proceedings that the longstanding policy limiting injunctions was designed to 6 avoid.”). As CERT suggests in its reply, plaintiff’s requested declaratory relief, if granted, would 7 effectively enjoin the CERT v. Starbucks case, which has been litigated in state court since 2010, 8 CERT MTD, Ex. B4, ECF No. 8-2, at 3, because it would decide the issue of the defendants’ 9 affirmative defense for defendants, thereby undoing the state court’s decision issued in 2015, id. 10 at 17, and preventing CERT’s enforcement action from moving forward. CERT Reply at 8 11 (“Since CalChamber cannot enjoin CERT from enforcing Proposition 65 in the CERT v. 12 Starbucks case, it also cannot obtain a judgment in this case declaring CERT’s enforcement of 13 Proposition 65 in the Starbucks case to violate the First Amendment.”); see also Monster 14 Beverage Corp. v. Herrera, No. EDCV1300786VAPOPX, 2013 WL 12131740, at *12 (C.D. Cal. 15 Dec. 16, 2013), aff’d, 650 F. App’x 344 (9th Cir. 2016) (finding declaratory relief barred by Anti- 16 Injunction Act where granting relief would “effectively bar all of the [defendant’s] claims in the 17 pending state court action, and resolve it just as an injunction would”). Accordingly, plaintiff’s 18 claim for declaratory relief is also dismissed without prejudice under the Anti-Injunction Act. 19 In light of the above, the court need not consider the remaining arguments for 20 abstention, including abstention under Colorado River Water. Defendants may renew any 21 arguments the court does not reach here in any future motions to dismiss. 22 II. REQUEST FOR JUDICIAL NOTICE 23 In conjunction with his motion to dismiss, defendant Becerra also filed a request 24 for judicial notice, which included, inter alia, (1) the dockets in the state court private 25 4 To the extent necessary, the court judicially notices the existence of the Superior Court’s 26 decision in CERT v. Starbucks, et al., Los Angeles Superior Court Case No. BC 435759, attached 27 as Exhibit B to CERT’s motion to dismiss. See CERT MTD, Ex. B; Reyn’s Pasta Bella, LLC v. Visa USA, Inc., 442 F.3d 741, 746 n.6 (9th Cir. 2006) (“We may take judicial notice of court 28 filings and other matters of public record.”). 1 enforcement proceedings listed in Exhibit 1 to the request; (2) the consent judgments filed in state 2 court proceedings brought by private Proposition 65 enforcers listed in Exhibit 2 to the request; 3 (3) the dockets in the state court proceedings listed in Exhibit 3 to the request, in which the 4 Attorney General has secured consent judgments; and (4) consent judgments filed in state court 5 enforcement proceedings brought by the Attorney General, which are attached to the request as 6 Exhibits 4 through 6. ECF No. 22. The request is not opposed. The court GRANTS the request 7 for judicial notice as to the existence of these dockets and documents, because they are matters of 8 official public record “capable of accurate and ready determination by resort to sources whose 9 accuracy cannot reasonably be questioned.” See Reyn’s Pasta Bella, LLC, 442 F.3d at 746 n.6 10 (“We may take judicial notice of court filings and other matters of public record.”). 11 The remainder of the request is for judicial notice of several administrative reports 12 on acrylamide by the U.S. Environmental Protection Agency, the California Office of Environmental 13 Health Hazard Assessment, the Food and Drug Administration, the International Agency for Research 14 on Cancer, and other similar agencies. See Req. for Judicial Not. at 3–4. Because these documents 15 relate to the merits of plaintiff’s underlying claim and not to the issues addressed in the motions 16 to dismiss, the court DENIES the request in this respect without prejudice. See CYBERsitter, 17 LLC v. People’s Republic of China, 805 F. Supp. 2d 958, 964 (C.D. Cal. 2011) (declining to take 18 judicial notice of fact irrelevant to instant motion). 19 Becerra also filed a second request in conjunction with his Reply, in which he 20 requested judicial notice of (1) a notice of motion and motion to stay filed on November 19, 2019, 21 in Patten v. Safeway, Case No. 37-2019-00011824-CU-NP-CTL (Exhibit 1); and (2) a 22 Proposition 65 notice letter against McDonald’s dated May 1, 2002, which was downloaded from 23 the Attorney General’s website (Exhibit 2). ECF No. 40 at 2. This request is also unopposed. 24 The court GRANTS the request as to the existence of both documents, but not as to the truth of 25 the contents therein. See Reyn’s Pasta Bella, LLC, 442 F.3d at 746 n.6; United States v. 14.02 26 Acres of Land More or Less in Fresno Cty., 547 F.3d 943, 955 (9th Cir. 2008) (“Judicial notice is 27 appropriate for ‘records and reports of administrative bodies.’” (citation omitted)). 28 ///// 1 III. CONCLUSION 2 Defendants’ motions to dismiss are GRANTED in part. Defendant Becerra’s first 3 request for judicial notice, ECF No. 27, is GRANTED in part and DENIED in part. Defendant 4 Becerra’s second request for judicial notice, ECF No. 40, is GRANTED. Plaintiff may file an 5 amended complaint within 14 days of this order. 6 Plaintiff’s preliminary injunction motion, ECF No. 26, is DENIED without 7 prejudice, as it is based on the dismissed claims. See Chiu v. BAC Home Loans Servicing, LP, 8 No. 2:11-CV-01400-ECR, 2012 WL 1902918, at *5 (D. Nev. May 25, 2012) (denying motion for 9 preliminary injunction on the basis plaintiff’s related claims were subject to dismissal under Rule 10 12(b)(6)); Bonneau v. United States, No. 10-653-PK, 2010 WL 3419542, at *1 (D. Or. Aug. 30, 11 2010) (dismissing motion for temporary restraining order on the basis it related to dismissed 12 claims). 13 This order resolves ECF Nos. 8, 20, 22, 26, 27, 32, 40 and 41. 14 IT IS SO ORDERED. 15 DATED: March 2, 2020. 16 17 18 19 20 21 22 23 24 25 26 27 28