Su v. SL One Global, Inc. ( 2023 )

1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 EASTERN DISTRICT OF CALIFORNIA 10 ----oo0oo---- 11 12 JULIE A. SU1, Acting Secretary No. 2:22-cv-00583 WBS AC of Labor, United States 13 Department of Labor, 14 Plaintiff, 15 v. MEMORANDUM AND ORDER RE: COUNTER-DEFENDANT UNITED 16 SL ONE GLOBAL, INC., dba VIVA STATES DEPARTMENT OF SUPERMARKET, a California LABOR’S MOTION TO 17 corporation; SMF GLOBAL, INC. DISMISS dba VIVA SUPERMARKET, a 18 California corporation, NARI TRADING, INC., dba VIVA 19 SUPERMARKET; UNI FOODS, INC., dba VIVA SUPERMARKET, a 20 California corporation; SEAN LOLOEE, an individual, and as 21 owner and managing agent of the Corporate Defendants; and KARLA 22 MONTOYA, an individual, and managing agent of the Corporate 23 Defendants, 24 Defendants. 25 26 27 1 Pursuant to Federal Rule of Civil Procedure 25(d), Acting Secretary of Labor Julie A. Su has been substituted for 28 former Secretary of Labor Martin J. Walsh. 1 SEAN LOLOEE; SL ONE GLOBAL, 2 INC. dba VIVA SUPERMARKET; SMF GLOBAL, INC. dba VIVA 3 SUPERMARKET; NARI TRADING, INC. 4 dba VIVA SUPERMARKET; and UNI FOODS, INC., 5 Counter-Claimants, 6 v. 7 UNITED STATES DEPARTMENT OF 8 LABOR; and VERONICA VILLAMOR, 9 Counter-Defendants. 10 11 ----oo0oo---- 12 Plaintiff Julie A. Su, in her capacity as Acting 13 Secretary of the United States Department of Labor, brings this 14 action against defendants SL One Global, SMF Global, Nari 15 Trading, and Uni Foods, all of which allegedly do business as 16 Viva Supermarket (the “corporate defendants”); Sean Loloee; and 17 Karla Montoya, alleging various ongoing violations of federal 18 labor laws at grocery stores operated by defendants. (Second Am. 19 Compl. (Docket No. 46).) 20 Sean Loloee and the corporate defendants brought two 21 counterclaims against the United States Department of Labor and 22 Veronica Villamor. The first counterclaim is brought pursuant to 23 Bivens v. Six Unknown Named Agents of Federal Bureau of 24 Narcotics, 403 U.S. 388 (1971), alleging that Villamor and other 25 Department of Labor employees engaged in a politically-motivated 26 investigation of Loloee that involved unwarranted searches and 27 seizures in violation of Loloee’s Fourth Amendment rights. The 28 second counterclaim is brought under the Freedom of Information 1 Act (“FOIA”), 5 U.S.C. § 552, alleging that the Department of 2 Labor failed to produce documents responsive to counterclaimants’ 3 FOIA request. (Docket No. 48.) Counter-defendant United States 4 Department of Labor now moves to dismiss both counterclaims, or 5 in the alternative moves for summary judgment on the FOIA 6 counterclaim. (Docket No. 51.)2 7 Federal Rule of Civil Procedure 12(b)(6) allows for 8 dismissal when a complaint or counterclaim fails to state a claim 9 upon which relief can be granted. See Fed. R. Civ. P. 12(b)(6); 10 Levitt v. Yelp! Inc., 765 F.3d 1123, 1135 (9th Cir. 2014). The 11 inquiry before the court is whether, accepting the allegations in 12 the counterclaim as true and drawing all reasonable inferences in 13 the plaintiff’s favor, the counterclaim has stated “a claim to 14 relief that is plausible on its face.” See Bell Atl. Corp. v. 15 Twombly, 550 U.S. 544, 570 (2007); Levitt, 765 F.3d at 1135. 16 Loloee and the corporate defendants bring their 17 counterclaims against new parties, namely the United States 18 Department of Labor and Veronica Villamor, rather than plaintiff 19 Julie Su.3 This is procedurally improper, as a counterclaim 20 2 The court does not recite a full background of the case as it has done so in a prior order. (See Docket No. 17.) 21 22 3 Loloee and the corporate defendants argue that Acting Secretary of Labor Julie Su is “not distinguishable” from the 23 Department of Labor. (See Opp’n at 7.) While they are correct in a practical sense -- this action is being litigated using the 24 resources and personnel of the Department of Labor -- there are numerous contexts in which it is necessary to make the 25 formalistic distinction between an agency head and the agency itself for pleading purposes. 26 As relevant here, it is necessary to distinguish 27 between the Secretary of Labor and the Department of Labor in the context of a FOIA claim, which must be brought against a federal 28 agency, not against federal officials. See Drake v. Obama, 664 1 cannot be asserted solely against new parties, but rather must 2 also be asserted against an existing opposing party. See Fed. R. 3 Civ. P. 13; Championship Prop. LLC v. Coan, No. 20-13728, 2022 WL 4 4455208, at *5 (11th Cir. Sept. 26, 2022) (citing Bowling v. U.S. 5 Bank Nat’l Ass’n, 963 F.3d 1030, 1032 (11th Cir. 2020)) 6 (explaining that where defendants brought purported 7 “counterclaims” against new parties only and not against the 8 original plaintiff, “the ‘counterclaims’ weren’t really 9 counterclaims at all”); Luma Pictures, Inc. v. Betuel, No. 16-cv- 10 2625 GW PLA, 2016 WL 11519331, at *6 n.4 (C.D. Cal. Sept. 29, 11 2016) (citing William W. Schwarzer et al., Cal. Prac. Guide: Fed. 12 Civ. Proc. Before Trial § 8:1217 (2012)) (“at least one of the 13 parties” the counterclaim is asserted against “must be an 14 opposing party”); Hawkins v. Berkeley Unified Sch. Dist., 250 15 F.R.D. 459, 462 (N.D. Cal. 2008) (quoting 6 Charles A. Wright et 16 al., Fed. Prac. & Proc. Civ. § 1435, at 270-71 (2d ed. 1990)) (“A 17 Rule 13(h) ‘counterclaim or cross-claim may not be directed 18 solely against persons who are not already parties to the 19 original action but must involve at least one existing party.’”) 20 This defect is fatal to both the FOIA and Bivens counterclaims. 21 F.3d 774, 785–86 (9th Cir. 2011) (affirming dismissal of FOIA 22 claims because defendants were “individuals, not agencies”); see also Batton v. Evers, 598 F.3d 169, 173 n.1 (5th Cir. 2010) 23 (cited with approval in Drake, 664 F.3d at 786) (“A FOIA plaintiff may not assert a claim against an individual federal 24 official; the proper defendant is the agency.”); Martinez v. Bureau of Prisons, 444 F.3d 620, 624 (D.C. Cir. 2006) (cited with 25 approval in Drake, 664 F.3d at 786) (“[T]he district court properly dismissed the named individual defendants because no 26 cause of action exists that would entitle appellant to relief 27 from them under . . . FOIA,” which “concern[s] the obligations of agencies as distinct from individual employees in those 28 agencies”). eee eee IEE NE OIE IE II I EES NE 1 See Hawkins, 250 F.R.D. at 463. 2 IT IS THEREFORE ORDERED that counter-defendant 3 | Department of Labor’s motion to dismiss (Docket No. 51) be, and 4 | hereby is, GRANTED as to both counterclaims.?4 5 | Dated: April 4, 2023 hhh an~ Ve 2d. bE 6 WILLIAM B. SHUBB UNITED STATES DISTRICT JUDGE 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 4 Because the court grants the Department of Labor’s motion to dismiss the counterclaims, it need not address its 28 alternative motion for summary judgment on those counterclaims.