Stampfli v. Susanville Sanitary District ( 2021 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 ----oo0oo---- 11 12 DEBORAH STAMPFLI, an individual, No. 2:20-cv-01566-WBS-DMC 13 Plaintiff, 14 v. MEMORANDUM AND ORDER RE: SUSANVILLE SANITARY DISTRICT, 15 SUSANVILLE SANITARY DISTRICT, a STEVEN J. STUMP, JOHN MURRAY, political subdivision of the ERNIE PETERS, DAVID FRENCH, 16 State of California, STEVE J. KIM ERB, AND MARTY HEATH’S STUMP, in his individual and MOTION TO DISMISS 17 official capacities, ERNIE PETERS, in his individual and 18 official capacities, DAVID FRENCH, in his individual and 19 official capacities, KIM ERB, in his individual and official 20 capacities, MARTY HEATH, in his individual and official 21 capacities, DOES I-V, inclusive, BLACK & WHITE CORPORATIONS I-V, 22 and ABLE & BAKER COMPANIES, inclusive, 23 Defendants. 24 25 ----oo0oo---- 26 Plaintiff Deborah Stampfli (“plaintiff”) brought this 27 action against the Susanville Sanitary District (“District”), 28 1 Steve J. Stump, John Murray, Ernie Peters, David French, Kim Erb, 2 Marty Heath, Black & White Corporations I-V, Able and Baker 3 Companies, and Does 1-5 inclusive, for breach of express 4 contract, breach of implied in fact contract, promissory 5 estoppel, deprivation of procedural due process rights, 6 deprivation of substantive due process, conspiracy to deprive 7 plaintiff of procedural and substantive due process rights, 8 interference with contractual rights, infliction of emotional 9 distress, and failure to produce public records. 10 Before the court is the Susanville Sanitary District, 11 Steve Stump, John Murray, Ernie Peters, David French, Kim Erb, 12 and Marty Heath’s Motion to Dismiss plaintiff’s First Amended 13 Complaint. (“Mot. to Dismiss” (Docket No. 22).) 14 I. Factual and Procedural Background 15 Plaintiff alleges that she was hired as treasurer by 16 the Susanville Sanitary District in 2005. (See First. Am. Compl. 17 (“FAC”) at ¶ 61 (Docket No. 20.) At the time of her hiring, 18 plaintiff was allegedly informed that she would be a member of 19 Operating Engineers Local Union No. 3 and that she would be 20 entitled to the benefits and protections of the agreements 21 between the union and the District, including the right to 22 continued employment and termination only for good cause and 23 after the satisfaction of procedural requirements. (See id.) 24 From 2005 to 2013, plaintiff alleges she performed her assigned 25 duties and a host of additional duties typically performed by 26 supervisory personnel, and consistently received high performance 27 evaluations. (See id. at ¶ 62.) 28 By October 2013, plaintiff was performing many 1 management and administrative functions but, because she was a 2 union member, she could not participate in confidential meetings 3 of the District’s Board of Directors. (See id. at ¶ 65.) Her 4 inability to participate in these meetings was inconvenient 5 because the board frequently had to stop meetings or delay them 6 to obtain information possessed only by plaintiff. (See id.) 7 Because of these difficulties, the board proposed the creation of 8 a new management level position with the District entitled 9 “Office Administrator” which would allow plaintiff to participate 10 in confidential board meetings but would require her to 11 relinquish her union membership. (See id.) 12 When plaintiff was offered this new position, she 13 declined it because she did not wish to lose the job security 14 offered by her union affiliation. (See id. at ¶ 67.) In 15 response to her concerns, plaintiff was allegedly advised by the 16 General Manager and the District’s general counsel that although 17 she could not remain a union member, she would not be an at-will 18 employee and would be afforded all the job security rights and 19 benefits available to union members. (See id. at ¶ 69.) 20 Plaintiff states she was promised that her employment with the 21 District would only be terminated for cause and in accordance 22 with established Skelly procedures.1 (See id.) Because of these 23 alleged representations, plaintiff relinquished her position as 24 1 The term Skelly procedures refers to the California 25 Supreme Court case Skelly v. State Personnel Board, 15 Cal.3d 194 (1975). In Skelly, the California Supreme Court held that a 26 permanent public employee’s property rights (i.e. their vested 27 right to continued employment) cannot be taken away by an employer without first being afforded certain procedural 28 safeguards. See id. at 215. 1 treasurer and accepted the new position of Office Administrator. 2 (See id. at ¶ 70.) 3 During 2016, plaintiff performed many duties typically 4 performed by the General Manager. (See id. at ¶ 75.) By October 5 2017, the General Manager recommended to the board that plaintiff 6 be provided a 20% salary increase to account for the additional 7 duties she performed and that she receive the additional title of 8 Assistant General Manager. (See id. at ¶ 80.) During an October 9 2017 board meeting, the board stated that plaintiff’s additional 10 duties would likely be temporary until such time as a new general 11 manager had obtained sufficient experience. (See id. at ¶ 82.) 12 However, the board approved the recommended change and prepared a 13 new job description which stated that the plaintiff would work in 14 conjunction with the District General Manager. (See id. at ¶ 15 83.) 16 While the aforementioned events were unfolding, a 17 nearby local utility district discovered that its General Manager 18 had embezzled money from the district. (See id. at ¶ 85.) The 19 members of the District’s board wished to ensure that the 20 District not be victimized in the same fashion. (See id.) 21 Plaintiff was specifically instructed to keep the board apprised 22 of any changes which might impair the security of the District’s 23 financial accounting services. (See id.) 24 In March 2018, the District hired defendant Steve Stump 25 to the position of probationary General Manager, and he relied 26 heavily on plaintiff for matters pertaining to administrative 27 operations. (See id. at ¶ 87.) Following the completion of 28 Stump’s probationary period, he became increasingly hesitant to 1 work in conjunction with the plaintiff. (See id. at ¶ 91.) 2 Plaintiff alleges that as part of his efforts to strip plaintiff 3 of any perceived co-equal authority she may have had with him, 4 Stump unilaterally amended plaintiff’s job description to 5 eliminate the requirements that she work “in conjunction with” 6 the General Manager. (See id. at ¶ 92.) 7 In April 2019, Stump wanted plaintiff to shift funds 8 from various accounts to allow for the purchase of a portable 9 generator. (See id. at ¶¶ 94–95.) Given plaintiff’s 10 instructions from several board members regarding the financial 11 affairs of the District, she requested that Stump delay this 12 purchase until after a new budget for 2020 was created or seek 13 approval from the board for the purchase. (See id.) This 14 allegedly infuriated Stump because he believed plaintiff was 15 refusing to acknowledge his authority over her. (See id.) 16 According to the FAC, Stump realized that plaintiff was 17 in control of the District’s finances because certain computer 18 programs which controlled the District’s finances were only on 19 the accounting department’s computers. (See id. at ¶ 99.) On or 20 about January 8, 2020, Stump directed plaintiff to have these 21 computer programs placed on his personal office computer. (See 22 id.) By placing these programs on Stump’s computer, it is 23 alleged, he would be able to transfer funds between accounts, 24 make payments out of accounts, adjust customer accounts, or 25 manipulate billings. (See id. at ¶ 100.) Because of the 26 instructions she had received from board members, plaintiff told 27 Stump that she wished to meet with certain board members to 28 determine whether it was necessary for such highly sensitive 1 programs to be placed on Stump’s computer. (See id. at ¶ 101.) 2 Stump responded to this by telling plaintiff to “get 3 out” and informing her that she was on unpaid administrative 4 leave. (See id. at ¶ 102.) Plaintiff alleges that prior to this 5 action, Stump had never informed plaintiff that her refusal to 6 comply with his request would result in disciplinary action. 7 (See id.) On January 14, 2020, plaintiff was informed that her 8 administrative leave would be paid, but not why she was placed on 9 leave in the first place. (See id. at ¶ 104.) On March 6, 2020, 10 Stump informed plaintiff that her “at-will” employment as Office 11 Administrator/Assistant General Manager was no longer needed and 12 would end as of March 6, 2020. (See id. at ¶ 105.) 13 On March 30, 2020, plaintiff’s counsel wrote to 14 defendants’ counsel to demand that she be afforded all rights of 15 review and appeal of the decision to terminate her employment. 16 (See id. at ¶ 116.) On or about April 6, 2020, defendants’ 17 counsel wrote to plaintiff’s counsel and informed him that 18 because plaintiff was an “at-will” employee, she had no such 19 rights to appeal or review. (See id. at ¶ 117.) 20 II. Discussion 21 Federal Rule of Civil Procedure 12(b)(6) allows for 22 dismissal when the plaintiff’s complaint fails to state a claim 23 upon which relief can be granted. See Fed. R. Civ. P. 12(b)(6). 24 The inquiry before the court is whether, accepting the 25 allegations in the complaint as true and drawing all reasonable 26 inferences in the plaintiff’s favor, the complaint has stated “a 27 claim to relief that is plausible on its face.” Bell Atl. Corp. 28 v. Twombly, 550 U.S. 544, 570 (2007). “The plausibility standard 1 is not akin to a ‘probability requirement,’ but it asks for more 2 than a sheer possibility that a defendant has acted unlawfully.” 3 Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). “Threadbare 4 recitals of the elements of a cause of action, supported by mere 5 conclusory statements, do not suffice.” Id. Although legal 6 conclusions “can provide the framework of a complaint, they must 7 be supported by factual allegations.” Id. at 679. 8 A. Federal Claims 9 The only federal claims in the FAC are plaintiff’s 10 fourth and fifth claims for violation of procedural and 11 substantive due process and her sixth claim for conspiracy in 12 connection with the termination her employment. Although it does 13 not expressly say so in the FAC, plaintiff’s counsel acknowledged 14 at the hearing that these claims are asserted under 42 U.S.C. § 15 1983. 16 1. Procedural Due Process 17 Plaintiff contends in her fourth claim that she had a 18 constitutionally protected property interest in continued 19 employment which was violated when she was terminated and denied 20 the pre-and post-termination procedures duly enacted and adopted 21 by the District. (See FAC at ¶¶ 160–64.) 22 a. Claims Against Individual Board Members and General Manager 23 24 To prevail on her claim that her termination 25 constituted a denial of property without due process of law, 26 plaintiff must first demonstrate that she had a protected 27 interest in continued employment. Dorr v. Butte County, 795 F.2d 28 875, 876 (9th Cir. 1986). State law defines what is and what is 1 not property. Id. Under California law, a permanent employee, 2 dismissible only for cause, has a property interest in his 3 continued employment which is protected by due process. See 4 Skelly, 15 Cal.3d at 207–08 (internal quotations omitted). 5 However, plaintiff seems to acknowledge that her position had 6 been converted to a position terminable at will. (See FAC at ¶ 7 84.) It is therefore not clear from the FAC that plaintiff had a 8 property interest in continued employment that was violated when 9 she was terminated. 10 Moreover, looking to the alleged conduct of the 11 individual board members and General Manager Stump, plaintiff 12 alleges that they violated her procedural due process rights when 13 they terminated her without cause and without following pre-and 14 post-termination procedures duly enacted and adopted by the 15 District. (See FAC at ¶ 6.) She alleges in conclusory terms 16 that all the board members had a duty to intervene and protect 17 her from unconstitutional acts, but that they refused to do so. 18 (See id. at ¶ 170.) However, outside of the law enforcement 19 context, neither plaintiff, defendants, nor this court have found 20 any California, the Ninth Circuit, or in Supreme Court precedent 21 supporting such a duty to intercede. (See Pl.’s Opp’n to Mot. to 22 Dismiss at 61.); Defs.’ Reply in Supp. of Mot. to Dismiss at 26 23 (Docket No. 29).) 24 Plaintiff’s FAC does not even seem to clearly allege 25 facts that identify who was responsible for her termination. 26 Plaintiff first states that it was the board who voted to 27 terminate her without just cause. (See FAC at ¶ 6.) She then 28 goes on to state that it was actually General Manager Stump who 1 placed her on unpaid administrative leave and ultimately fired 2 her. (See FAC at ¶¶ 102–106.) The FAC does not even specify a 3 vote by the board. To the contrary, the FAC actually alleges 4 that there were instances where Stump acted unilaterally and 5 without board approval. (See FAC at ¶¶ 92–93.) In short, 6 plaintiff does not sufficiently allege who caused the injuries of 7 which she complains. Accordingly, plaintiff’s procedural due 8 process claims against the individual defendants will be 9 dismissed. 10 b. Claim Against the District 11 Because 42 U.S.C. § 1983 does not provide for vicarious 12 liability, local governments “may not be sued under § 1983 for an 13 injury inflicted solely by its employees or agents.” Monell v. 14 Department of Social Services of the City of New York, 436 U.S. 15 658, 694 (1978). “Instead, it is when execution of a 16 government’s policy or custom, whether made by its lawmakers or 17 by those whose edicts or acts may be fairly said to represent 18 official policy, inflicts the injury that the government as an 19 entity is responsible under § 1983.” Id. 20 To survive a motion to dismiss, a plaintiff must do 21 more than simply allege that a Monell defendant “maintained or 22 permitted an official policy, custom, or practice of knowingly 23 permitting the occurrence of the type of wrongs” alleged in the 24 complaint. See AE ex. rel. Hernandez v. County of Tulare, 666 25 F.3d 631, 637 (9th Cir. 2012). Facts regarding the specific 26 nature of the alleged policy, custom, or practice are required; 27 merely stating the subject to which the policy relates (e.g., 28 excessive force) is insufficient. See id. 1 To establish Monell liability based upon governmental 2 policy custom, plaintiffs must show that (1) they were deprived 3 of a constitutional right, (2) the municipality had a policy; (3) 4 the policy amounted to a deliberate indifference to their 5 constitutional right; and (4) the policy was the “moving force 6 behind the constitutional violation.” See Mabe v. San Bernardino 7 County, 237 F.3d 1101, 1110–11 (9th Cir. 2001)(citing Van Ort v. 8 Estate of Stanewich, 93 F.3d 831, 835 (9th Cir. 1996)). 9 For an unwritten policy or custom to form the basis of 10 a Monell claim, it must be so “persistent and widespread” that it 11 constitutes a “permanent and well settled” practice. See Monell, 12 436 U.S. at 691. In pleading such a claim, the complaint must 13 “put forth additional facts regarding the specific nature of 14 [the] alleged policy, custom, or practice.” See AE ex. rel. 15 Hernandez, 666 F.3d at 637. “Liability for improper custom may 16 not be predicated on isolated or sporadic incidents; it must be 17 founded upon practices of sufficient duration, frequency and 18 consistency that the conduct has become a traditional method of 19 carrying out policy.” See Trevino v. Gates, 99 F.3d 911, 918 20 (9th Cir. 1996). 21 Here, the thrust of the allegations against the 22 District is that it “adopted a de facto and unconstitutional 23 policy by failing to enforce its own adopted policies and 24 procedures when it was clearly obvious that said policies were 25 being ignored by its management employees.” (See FAC at ¶ 173.) 26 However, plaintiff has not alleged facts to support that this 27 “unconstitutional custom or policy” was anything more than an 28 isolated or sporadic incident. Indeed, she contends that she is 1 the only employee to have been terminated without cause and 2 without complying with the mandates created by Resolution 04.06 3 and Skelly. (See id. at ¶ 63.) Liability for improper custom or 4 policy must be predicated on practices of sufficient duration, 5 frequency and consistency such that the conduct has become a 6 traditional method of carrying out policy. See Trevino, 99 F.3d 7 at 918. 8 Plaintiff’s allegations are therefore insufficient to 9 state a plausible, not merely possible, claim for relief based 10 upon procedural due process violations against the District. See 11 AE ex rel. Hernandez, 666 F.3d at 637. 12 2. Substantive Due Process 13 “The substantive component of the Due Process Clause 14 forbids the government from depriving a person of life, liberty, 15 or property in such a way that. . . interferes with rights 16 implicit in the concept of ordered liberty.” See Engquist v. 17 Oregon Dept. of Agric., 478 F.3d 985, 996 (9th Cir. 2007). A 18 threshold requirement to a substantive or procedural due process 19 claim is the plaintiff’s showing of a liberty or property 20 interest protected by the Constitution. See id. “Most courts 21 have rejected the claim that substantive due process protects the 22 right to a particular public employment position and [the Ninth 23 Circuit] has yet to decide the issue.” Id. at 996–97. The Ninth 24 Circuit has recognized that “there is substantive due process 25 protection against government employer actions that foreclose 26 access to a particular profession to the same degree as 27 government regulation.” Id. at 998. However, the Ninth Circuit 28 has limited substantive due process claims for a public 1 employer’s violation of occupational liberty to extreme cases 2 such as a government blacklist, which when circulated or 3 otherwise publicized to prospective employers effectively 4 excludes the blacklisted individual from his occupation. See id. 5 Plaintiff’s fifth claim alleges that she possessed a 6 constitutionally protected property right and/or liberty interest 7 in continued employment and that defendants have violated her 8 substantive due process right to such employment. (See FAC at ¶¶ 9 176–191.) She also alleges that “the conduct of the defendants 10 has deprived [her] of all ability to obtain employment in her 11 chosen field and is shocking to the conscience.” (See id. at ¶ 12 180.) These conclusory allegations are insufficient to plausibly 13 allege that she had a constitutionally protected substantive due 14 process right in her continued employment at the Susanville 15 Sanitary District. 16 The Ninth Circuit has not recognized that substantive 17 due process protects the right to a particular public employment 18 position. See Engquist, 478 F.3d at 996–97. Although plaintiff 19 states that she has been “deprived of all ability to obtain 20 employment in her chosen field”, (see FAC at ¶ 180), she has 21 pleaded no facts to support this bald assertion. Nor has 22 plaintiff pleaded facts that would plausibly support an inference 23 that the defendants’ conduct “shocks the conscience.” (See FAC 24 at ¶ 180.) Accordingly, defendants’ motion to dismiss 25 plaintiff’s substantive due process claim will be granted. 26 3. Conspiracy to Deprive Substantive and Procedural 27 Due Process Rights 28 1 Plaintiff’s sixth claim alleges conspiracy with the 2 intent of depriving plaintiff of her constitutionally protected 3 substantive and procedural due process rights. (See FAC at ¶¶ 4 192–198.) Because the court has determined that plaintiff has 5 not sufficiently alleged that she had a substantive due process 6 right under the United States Constitution to continued 7 employment at the District, there can be no conspiracy to deprive 8 plaintiff of non-existent substantive due process rights. With 9 regard to her procedural due process rights, plaintiff merely 10 alleges, without any factual specificity, that the defendants 11 “either expressly, implicitly, or tacitly, agreed, cooperated, or 12 joined in a concerted action to deprive plaintiff of her 13 Constitutionally protected property and/or liberty rights.” (See 14 FAC at ¶ 193.) Such conclusory allegations do not suffice. 15 Accordingly, plaintiff’s sixth cause of action for conspiracy to 16 deprive plaintiff of due process rights will be dismissed. 17 B. State Law Claims 18 Because all of plaintiff’s federal claims must be 19 dismissed, in its discretion under 28 U.S.C. § 1367(c)(3), the 20 court will decline to exercise jurisdiction over plaintiff’s 21 supplemental state law claims at this time. Any further amended 22 complaint filed pursuant to this Order shall be deemed to 23 supersede the first amended complaint, and if plaintiff elects to 24 file a second amended complaint which reasserts her state law 25 claims, defendants may reassert their motion to dismiss the state 26 law claims at that time.2 27 2 Because defendants’ request for judicial notice 28 pertains solely to the state law claims, the court declines to eee eee IEE III IE IIE III EEE ES PSE IIE ESO 1 IT IS THEREFORE ORDERED that defendants’ motion to 2 dismiss (Docket No. 22) be, and the same is, hereby GRANTED with 3 respect to the fourth, fifth, and sixth claims of the First 4 | Amended Complaint. Plaintiff has twenty days from the date this 5 Order is signed to file an amended complaint, if she can do so 6 | consistent with this Order. 7 | Dated: March 11, 2021 hhh an~ Ve 2d. bE g WILLIAM B. SHUBB UNITED STATES DISTRICT JUDGE 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 | take judicial notice at this time. 14