Gold Country Development, LLC v. County of El Dorado ( 2021 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 11 GOLD COUNTRY DEVELOPMENT, No. 2:20-cv-01712-MCE-CKD LLC, a New York State limited liability 12 company, et al. 13 Plaintiffs, MEMORANDUM AND ORDER 14 v. 15 COUNTY OF EL DORADO, a public entity, et al., 16 Defendants. 17 18 By way of this action, Plaintiffs Gold Country Development, LLC, Evelyn A. Gex, , 19 and Christopher J. Marconi (collectively, “Plaintiffs” unless otherwise specified) seek 20 redress for damages and injuries they claim to have sustained as a result of a raid upon 21 their hemp-growing operation in 2019. Defendants include the County of El Dorado 22 (“County”), the El Dorado County Sheriff’s Department (“Sheriff’s Department”), 23 El Dorado County Sherriff John D’Agostini (“D’Agostini”) and El Dorado County Sherriff’s 24 Deputy Daryl J. Miller (“Miller”) (“Defendants”). 25 Plaintiffs allege in their Complaint that, in effectuating the subject raid, Defendants 26 deprived them of their Constitutional rights in violation of both 42 U.S.C. § 1983 and 27 California’s Bane Civil Rights Act, Cal. Civ. Code § 52.1 (“Bane Act”). Plaintiffs further 28 allege various common law state claims, including conversion, trespass to chattels, 1 negligence, intentional infliction of emotional distress, and declaratory relief. Now before 2 this Court is a Motion to Dismiss brought, on behalf of all Defendants except Miller, 1 3 pursuant to Federal Rule of Civil Procedure 12(b)(6).2 ECF No. 6. Plaintiffs timely 4 opposed Defendants’ Motion to Dismiss. ECF No. 14. Defendants then timely replied to 5 Plaintiffs’ Opposition. ECF No. 15. For all the following reasons, Defendants’ Motion to 6 Dismiss (ECF No. 6) is GRANTED. 7 8 BACKGROUND3 9 10 Both federal law and California law permit the research and commercialization of 11 hemp, notwithstanding prohibitions on marijuana. Hemp and marijuana are variants of 12 the Cannabis Sativa L plant, but hemp by definition contains no more than 0.3% 13 tetrahydrocannabinol (“THC”). Cal. Health & Safety Code § 11018.5. Furthermore, 14 hemp is expressly excluded from the Controlled Substances Act, which states that “the 15 term ‘marijuana’ does not include. . .hemp. . .” 21 U.S.C. § 802. Notably, there is no 16 way to distinguish between hemp and marijuana based on plain view or odor alone. 17 According to Plaintiffs, with the passage of Proposition 64 in November 2016, 18 California law encourages research in hemp cultivation and production by permitting so- 19 called Established Agricultural Research Institutions (“EARIs”) to grow hemp. EARIs are 20 expressly permitted to cultivate and produce hemp plants with a THC content greater 21 than 0.3% if such cultivation “contributes to the development of types of industrial hemp 22 that will comply with the 0.3 percent THC limit.” Cal. Health & Safety Code 23 1 The docket in this matter does not reflect that Miller has been either served with process or made 24 any appearance as a party, and inquiry by the Court has confirmed that this is indeed the case. Consequently, no motion has been made on Miller’s behalf. Plaintiffs are hereby ordered to show cause 25 as to why Defendant Miller should not be dismissed for failure to serve, in accordance with Rule 4(m), within ten (10) days of the date this Memorandum and Order is electronically filed. 26 2 All further references to “Rule” or “Rules” are to the Federal Rules of Civil Procedure unless otherwise noted. 27 3 Unless indicated otherwise, the following recitation of facts is taken, at times verbatim, from 28 Plaintiffs’ Complaint, ECF No. 1. 1 § 81006(e)(10). Unlike other industrial hemp growers, EARIs are not required to obtain 2 a laboratory test report of THC levels of a random sampling within 30 days before 3 harvest. Cal. Health & Safety Code § 81006(e). 4 In response to the demand for a variety of hemp-based products, including oils, 5 sprays, and other medicinal agents, Plaintiff Gex, established Gold Country 6 Development, LLC (the “LLC”). The LLC purchased 237 acres of land to research and 7 grow hemp at 4050 Lakeview Drive in El Dorado County. Although Gex was ostensibly 8 the sole owner of the LLC, her “companion, fellow researcher and business associate”, 9 Plaintiff Marconi, participated in the operation and Plaintiffs allege that together they 10 operated and maintained the LLC as an EARI even though it had not yet been formally 11 registered as such with the El Dorado County Agricultural Commissioner. 12 In May 2019, Plaintiffs purchased 5,500 certified hemp seeds under the LLC as 13 an EARI. At that time, Plaintiffs claim they were set to register as a commercial grower 14 with the California Department of Food and Agriculture (“CDFA”), were prepared to plant 15 the hemp seedlings, and intended to use the future profits to recoup their extensive start- 16 up costs. 17 On or about July 12, 2019, a search warrant was issued for the Lakeview Drive 18 property by a magistrate judge of the El Dorado County Superior Court. The search 19 warrant ordered “the destruction of any remaining marijuana in excess of 10 20 pounds . . . after samples, as required by Health and Safety section 11479. . .” 21 (emphasis added). On or about July 17, 2019, over the course of nine hours, the search 22 warrant was executed at the Lakeview Drive property by about 25 deputies and agents, 23 including Miller, after Plaintiffs Gex and Marconi were ordered out of the residence at 24 gunpoint and handcuffed. The various items were seized, including 5,500 hemp 25 seedlings, 450 Pa Khang hemp seedlings, and 12 medicinal marijuana plants, along with 26 funds, computers, and documents belonging to Plaintiffs. 27 As the property was being searched, Plaintiffs and other onsite witnesses 28 informed the deputies that the 5,500 seedlings were hemp and that the only marijuana 1 being grown on the premises was for Plaintiffs’ personal medicinal use. Moreover, the 2 Lakeview Drive property contained other evidence of hemp cultivation, including 3 literature, cannabidiol (“CBD”) products, growing charts and plans, and business 4 documents. While interrogating Gex and Marconi, the deputies, and Miller in particular, 5 made statements indicating they believed Plaintiffs were operating in connection with a 6 marijuana ring out of New York. Ultimately, the deputies destroyed the hemp seedlings 7 and medicinal marijuana prior to any THC laboratory testing. 8 Plaintiffs further allege that Defendant County failed to train the individual 9 Defendants, maintained an official policy and/or custom of deliberate indifference of 10 constitutional rights by officers, and ratified actions taken by the individual Defendants’ 11 actions that violated Plaintiffs’ rights. As support for these allegations, Plaintiffs point to 12 a single Board Supervisor meeting on June 23, 2020, where D’Agostini made erroneous 13 statements about hemp and the hemp testing process, including his belief that hemp 14 growers exceed the THC limitation and cash crop growers are experiencing 5%, 7%, and 15 10% THC levels well beyond those associated with hemp. Generally, Plaintiffs aver that 16 D’Agostini misunderstood the difference between cannabis plants being cultivated for 17 hemp as opposed to marijuana, since he believed that there was no valid distinction 18 between the two crops. 19 20 STANDARD 21 22 On a motion to dismiss for failure to state a claim under Federal Rule of Civil 23 Procedure (“FRCP”) 12(b)(6), all allegations of material fact must be accepted as true 24 and construed in the light most favorable to the nonmoving party. Cahill v. Liberty Mut. 25 Ins. Co., 80 F.3d 336, 337-38 (9th Cir. 1996). Rule 8(a)(2) “requires only ‘a short and 26 plain statement of the claim showing that the pleader is entitled to relief’ in order to ‘give 27 the defendant fair notice of what the . . . claim is and the grounds upon which it rests.’” 28 Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 1 355 U.S. 41, 47 (1957)). A complaint attacked by a Rule 12(b)(6) motion to dismiss 2 does not require detailed factual allegations. However, “a plaintiff’s obligation to provide 3 the grounds of his entitlement to relief requires more than labels and conclusions, and a 4 formulaic recitation of the elements of a cause of action will not do.” Id. (internal citations 5 and quotation marks omitted). A court is not required to accept as true a “legal 6 conclusion couched as a factual allegation.” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) 7 (quoting Twombly, 550 U.S. at 555). “Factual allegations must be enough to raise a right 8 to relief above the speculative level.” Twombly, 550 U.S. at 555 (citing 5 Charles Alan 9 Wright & Arthur R. Miller, Federal Practice and Procedure § 1216 (3d ed. 2004) (stating 10 that the pleading must contain something more than “a statement of facts that merely 11 creates a suspicion [of] a legally cognizable right of action”)). 12 Furthermore, “Rule 8(a)(2) . . . requires a showing, rather than a blanket 13 assertion, of entitlement to relief.” Twombly, 550 U.S. at 555 n.3 (internal citations and 14 quotation marks omitted). Thus, “[w]ithout some factual allegation in the complaint, it is 15 hard to see how a claimant could satisfy the requirements of providing not only ‘fair 16 notice’ of the nature of the claim, but also ‘grounds’ on which the claim rests.” Id. (citing 17 Wright & Miller, supra, at 94, 95). A pleading must contain “only enough facts to state a 18 claim to relief that is plausible on its face.” Id. at 570. If the “plaintiffs . . . have not 19 nudged their claims across the line from conceivable to plausible, their complaint must 20 be dismissed.” Id. However, “[a] well-pleaded complaint may proceed even if it strikes a 21 savvy judge that actual proof of those facts is improbable, and ‘that a recovery is very 22 remote and unlikely.’” Id. at 556 (quoting Scheuer v. Rhodes, 416 U.S. 232, 236 23 (1974)). 24 A court granting a motion to dismiss a complaint must then decide whether to 25 grant leave to amend. Leave to amend should be “freely given” where there is no 26 “undue delay, bad faith or dilatory motive on the part of the movant, . . . undue prejudice 27 to the opposing party by virtue of allowance of the amendment, [or] futility of the 28 amendment . . . .” Foman v. Davis, 371 U.S. 178, 182 (1962); Eminence Capital, LLC v. 1 Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003) (listing the Foman factors as those to 2 be considered when deciding whether to grant leave to amend). Not all of these factors 3 merit equal weight. Rather, “the consideration of prejudice to the opposing party . . . 4 carries the greatest weight.” Id. (citing DCD Programs, Ltd. v. Leighton, 833 F.2d 183, 5 185 (9th Cir. 1987)). Dismissal without leave to amend is proper only if it is clear that 6 “the complaint could not be saved by any amendment.” Intri-Plex Techs. v. Crest Group, 7 Inc., 499 F.3d 1048, 1056 (9th Cir. 2007) (citing In re Daou Sys., Inc., 411 F.3d 1006, 8 1013 (9th Cir. 2005); Ascon Props., Inc. v. Mobil Oil Co., 866 F.2d 1149, 1160 (9th Cir. 9 1989) (“Leave need not be granted where the amendment of the complaint . . . 10 constitutes an exercise in futility . . . .”)). 11 12 ANALYSIS 13 14 A. Plaintiffs’ § 1983 Claims 15 Brought solely under § 1983, Plaintiffs assert their first, second, and third causes 16 of action against Defendants for unreasonable search and seizure/destruction, violations 17 of their due process rights, and the taking of their private property without just 18 compensation, respectively. ECF No. 1, ¶¶ 59-78. 19 Section 1983 provides relief against “[e]very person who, under color of any 20 statute, ordinance, regulation, custom, or usage, of any State . . . causes . . . any citizen 21 of the United States . . . the deprivation of any rights, privileges, or immunities secured 22 by the Constitution.” 42 U.S.C. § 1983. Section 1983 gives parties “a method for 23 vindicating federal rights elsewhere conferred.” Graham v. Connor, 490 U.S. 386, 394 24 (1989) (quoting Baker v. McCollan, 443 U.S. 137, 144 n. 3 (1979)). Parties can seek 25 relief under § 1983 against persons acting under the color of state law. West v. 26 Atkins, 487 U.S. 42, 48 (1988). “Persons” covers “state and local officials sued in their 27 individual capacities, private individuals and entities which acted under color of state law, 28 and local governmental entities.” Vance v. Cty. of Santa Clara, 928 F. Supp. 993, 995– 1 96 (N.D. Cal. 1996). 2 Plaintiff must allege “personal participation” in the alleged constitutional violation 3 on the part of the individual to subject that person to individual liability; this is a 4 “personal-capacity” suit under § 1983. Jones v. Williams, 297 F.3d 930, 934 (9th Cir. 5 2002). “Persons” includes municipalities and their agents only in the narrow instances 6 when the municipality itself causes the Constitutional violation through a policy or 7 custom; this is an “[o]fficial-capacity suit” under § 1983. Monell v. New York Dep’t of 8 Social Services, 436 U.S. 658, 690 n. 55 (1978). In a personal-capacity § 1983 claim, a 9 government official personally causes a deprivation of a federal right and is personally 10 liable. In an official-capacity claim, the governmental entity or its agents act as the 11 “moving force” behind the deprivation, and the entity remains liable for the actions of its 12 agents. Kentucky v. Graham, 473 U.S. 159, 165–67 (1985). 13 Understanding the difference between 1) an official-capacity Monell theory of 14 liability against a municipality and 2) a personal-capacity theory of liability against the 15 individual law enforcement officers involved in the alleged violation is critical to resolving 16 the constitutional issues presented by this case. 17 The only defendant who personally participated in executing the search warrant 18 against Plaintiffs was Deputy Miller, and he is not a party to this Motion. The remaining 19 Defendants (the County of El Dorado, the El Dorado County Sheriff’s Department and 20 Sheriff D’Agostini) are named only in their official capacities under Monell. Any such 21 Monell liability depends upon a showing that those entities and D’Agostini were 22 deliberately indifferent to a pattern or practice of civil rights violations committed by their 23 deputies, including Miller. See Merritt v. County of Los Aneles, 875 F.2d 765, 770 (9th 24 Cir. 1989). We must accordingly next determine whether any such showing has been 25 made. 26 /// 27 /// 28 /// 1 1. Plaintiffs’ § 1983 Claims Against Defendants Sheriff’s Department and D’Agostini 2 3 Plaintiffs’ Complaint names, in addition to the County of El Dorado itself, the 4 El Dorado County Sheriff’s Department, as an additional defendant along with D’Agostini 5 in his official capacity as El Dorado County Sheriff. The Supreme Court has held that an 6 “official-capacity suit is, in all respects other than name, to be treated as a suit against 7 the entity.” Kentucky v. Graham, 473 U.S. 159, 166 (1985). Such a suit “is not a suit 8 against the official personally, for the real party in interest is the entity.” Id. (emphasis in 9 original). Where an action names municipal officials in their official capacity and the 10 municipal entity itself is also being sued, “then the claims against the individuals are 11 duplicative and should be dismissed.” Williams v. Dirkse, No. 1:21-cv-00047-BAM (PC) 12 2021 WL 2227636, at *8 (June 2, 2021) (quoting Vance v. Cty. of Santa Clara, 13 928 F. Supp. at 993 (N.D. Cal. 1996). Moreover, where a subdivision of a county is 14 named, such as a sheriff’s department, the appropriate defendant is the 15 county. Spears v. El Dorado Cty. Sheriff’s Dep’t, 2019 WL 1043105, at *3 (E.D. Cal. 16 Mar. 5, 2019) (quoting Vance v. Cty. of Santa Clara, 928 F. Supp. at 996) (“The County 17 is a proper defendant in a § 1983 claim, an agency of the County is not.”). See 18 also, Brown v. Cty. of Kern, 2008 WL 544565, at *3 (E.D. Cal. Feb. 26, 2008) (“A suit 19 against . . . Kern County Sheriff Deputies, in their official capacities is the same as a suit 20 against the payor of any damages that may be awarded, therefore the proper defendant 21 is Kern County.”); Brewster v. Shasta Cty., 275 F.3d 803, 805 (9th Cir. 2001) (finding 22 that the sheriff acts on behalf of the county when administering county policies).4 23 Given the above caselaw, Plaintiffs cannot maintain an official capacity suit 24 against either the Sheriff’s Department or D’Agostini because they are inseparable from 25 the County itself. Accordingly, the Complaint against Defendants Sheriff’s Department 26 4 It should be noted that, although the California Supreme Court in Venegas v. Cty. of Los Angeles, 32 Cal. 4th 820, 839 (2004), held that sheriffs are actors of the state – not the county – when 27 enforcing state laws, that ruling is not binding on this Court for purposes of § 1983 liability. Therefore, because the Ninth Circuit has not adopted the holding in Venegas, the Court declines to follow Venegas’s 28 reasoning. 1 and D’Agostini in his official capacity, is DISMISSED, with leave to amend. This leads 2 us to consider whether Plaintiffs’ suit is proper against the only other moving defendant, 3 El Dorado County. 4 2. Plaintiffs’ § 1983 Claims Against Defendant County 5 Municipalities cannot be vicariously liable for the conduct of their employees 6 under § 1983, but rather are only “responsible for their own illegal acts.” Connick v. 7 Thompson, 563 U.S. 51, 60 (2011) (citing Monell, 436 U.S. at 665-83). In other words, a 8 municipality may only be liable where it individually caused a constitutional violation via 9 “execution of government’s policy or custom, whether by its lawmakers or by those 10 whose edicts or acts may fairly be said to represent official policy.” Monell, 436 U.S. at 11 694. 12 The Supreme Court made clear that plaintiffs may not merely allege that a 13 municipal employee wronged them to achieve success on a Monell claim. “Where a 14 plaintiff claims that the municipality has not directly inflicted an injury, but nonetheless 15 has caused an employee to do so, rigorous standards of culpability and causation must 16 be applied to ensure that the municipality is not held liable solely for the actions of its 17 employee.” Bd. of Cty. Comm’rs of Bryan Cty., Okl. v. Brown, 520 U.S. 397, 405 (1997) 18 (emphasis added). Similar demands apply to allegations of inadequate training. See 19 City of Canton, Ohio v. Harris, 489 U.S. 378, 389-91 (1989). Following Twombly and 20 Iqbal, the Ninth Circuit held that plaintiffs alleging Monell claims must provide allegations 21 that are not mere recitations of the elements of such a claim, and such facts must 22 plausibly suggest entitlement to relief. AE ex rel. Hernandez v. Cty. of Tulare, 666 F.3d 23 631, 637 (9th Cir. 2012); see, e.g., Dougherty v. City of Covina, 654 F.3d 892, 900-01 24 (9th Cir. 2011). 25 Plaintiffs’ Complaint nonetheless offer only conclusory allegations that Defendants 26 engaged in policies, procedures, and customs that would support Monell liability. See 27 generally, ECF No. 1. Plaintiffs’ Opposition to this Motion fares no better by merely 28 pointing to the single instance involving Plaintiffs along with alleged statements made by 1 D’Agostini at an El Dorado County Commission meeting nearly a year later. Plaintiffs 2 have failed to identify plausible deficiencies in Defendants’ policies, procedures, and 3 customs constituting deliberate indifference to others’ property. The Complaint alleges 4 neither a complete absence of officer training for cannabis-related search warrants, nor 5 describes the inadequacy of any training that did occur. Additionally there are no factual 6 averments identifying any prior hemp-related search and seizure violations of a 7 constitutional magnitude that would have notified Defendants of the need for specific 8 training on marijuana/hemp issues. Given those shortcomings, Plaintiffs have not met 9 the pleading requirements necessary to state a viable claim under Monell. See AE ex 10 rel. Hernandez, 666 F.3d at 637. 11 Plaintiffs have, thus, failed to sufficiently plead their Monell claims against the 12 moving Defendants. ECF No. 1, ¶¶ 10, 59-78. Accordingly, Defendants’ Motion to 13 Dismiss the first, second, and third causes of action is GRANTED with leave to amend. 14 3. Plaintiffs’ State Law Claims 15 Plaintiffs assert the fourth through twelfth causes of action on state law grounds. 16 However, this action was brought under federal question jurisdiction. Because Plaintiffs 17 failed to sufficiently plead a constitutional basis for their federal claims at this time, the 18 Court declines to exercise supplemental jurisdiction over the remaining state law claims 19 at this time pursuant to 28 U.S.C. § 1367. Therefore, the Court need not adjudicate the 20 merits of Plaintiffs’ state law claims and declines to do so. 21 4. Plaintiffs’ Declaratory Relief Claim5 22 In the Motion to Dismiss briefing, the parties both agree that Plaintiffs’ thirteenth 23 cause of action will be resolved through the litigation of the other asserted claims. See 24 ECF No. 14, 19:16-21; ECF No. 15, 1:19-21. Therefore, this cause of action is 25 cumulative to this dispute. Accordingly, Defendants’ Motion to Dismiss the thirteenth 26 cause of action is GRANTED. 27 5 The Complaint erroneously stated the claim for declaratory relief as the “fourteenth” cause of 28 action when it is in fact the thirteenth cause of action. 1 CONCLUSION 2 3 For all the foregoing reasons, Defendants’ Motion to Dismiss (ECF No. 6) is 4 | GRANTED. Plaintiffs’ Complaint, as directed against Defendants El Dorado County, the 5 | El Dorado County Sheriff's Department, and Sheriff D’Agostini is accordingly 6 | DISMISSED with leave to amend as to the first, second, and third causes of action. 7 | Because Plaintiffs’ federal law claims fail, the Court lacks jurisdiction over Plaintiffs’ 8 | pendant state law claims, and it declines to adjudicate the merits of those claims in the g | absence of any cognizable federal claims. Finally, pursuant to the agreement of the 40 | parties, Defendants’ Motion to Dismiss the thirteenth cause of action is GRANTED. 11 Should Plaintiffs wish to do so, they may file an amended complaint not later than 42 | twenty (20) days after the date this Memorandum and Order is electronically filed. 43 | Failure to amend within those time parameters will result in a dismissal of Defendants 44 | El Dorado County, the El Dorado County Sheriff's Department, and Sheriff D’Agostini, 45 | with prejudice and without further notice to the parties. 16 IT |S SO ORDERED. 47 | Dated: September 27, 2021 ar LE Mtg» _{ ZL SNC. ‘9 SENIOR UNITED STATES DISTRICT JUDGE 20 21 22 23 24 25 26 27 28 11