Alvin L. Kendall vs Thaxton Road LLC

[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________ FILED
U.S. COURT OF APPEALS
No. 10-14634 ELEVENTH CIRCUIT
Non-Argument Calendar SEPTEMBER 7, 2011
________________________ JOHN LEY
CLERK
D.C. Docket No. 1:09-cv-03520-TWT
ALVIN L. KENDALL,
llllllllllllllllllllllllllllllllllllllllPlaintiff-Appellant,
versus
THAXTON ROAD LLC,
HATHAWAY DEVELOPMENT COMPANY, INC., et al.,
llllllllllllllllllllllllllllllllllllllllDefendants-Appellees.
________________________
Appeal from the United States District Court
for the Northern District of Georgia
________________________
(September 7, 2011)
Before TJOFLAT, CARNES and ANDERSON, Circuit Judges.
PER CURIAM:
Alvin Kendall, proceeding pro se, appeals the dismissal without prejudice
of his complaint brought pursuant to the Clean Water Act (“CWA”), 33 U.S.C.
§§ 1251-1376 and Georgia state law. Kendall’s complaint named as defendants:
(1) Thaxton Road, LLC, the owner or operator of a development site, Bedford
Estates, that was the alleged source of pollutants flowing onto property located at
3810 Thaxton Road; (2) Hathaway Development Company, Inc., another owner or
operator of the development site; (3) Atlantic Southern Bank, a provider of
financing for the development; (4) Flag Bank, now known as RBC Centura Bank,
another provider of financing; (5) Bobby Smith, the Development Services
Manager for the Fulton County Department of Environmental and Community
Development, in his individual and official capacity; (6) Dick Wilcox, the Director
of the Fulton County Department of Environment and Community Development,
in his individual and official capacity; and (7) Elite Engineering, P.C., the
engineering firm that designed the plans for the development site.
Kendall raises several arguments on appeal. First, Kendall argues that the
district court erred in dismissing his state law claims because its finding that he
lacked standing was erroneous. Second, Kendall argues that the district court
erred in dismissing his CWA claims because he also possessed standing to pursue
those claims. Third, Kendall argues that the district court erred in denying his
motion to amend his complaint. Fourth, Kendall argues that the district court
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erred in denying as moot his motion for disqualification of the attorneys for
Thaxton Road, Hathaway Development Company, Atlantic Southern Bank, and
RBC Centura Bank. Fifth, Kendall argues that the district court erred in denying
as moot his motion for the cost of service against Atlantic Southern Bank and Elite
Engineering. Finally, Kendall argues that the district court erred by dismissing his
default judgment against Elite Engineering.
I. State Law Claims
Kandall first challenges the district court’s determination that he lacked
standing to pursue his state law claims. “We review de novo the district court’s
grant of a motion to dismiss under [Rule] 12(b)(6) for failure to state a claim,
accepting the allegations in the complaint as true and construing them in the light
most favorable to the plaintiff.” Hill v. White, 321 F.3d 1334, 1335 (11th Cir.
2003) (per curiam). “Pro se pleadings are held to a less stringent standard than
pleadings drafted by attorneys and will therefore be liberally construed.”
Tannenbaum v. United States, 148 F.3d 1262, 1263 (11th Cir. 1998) (per curiam).
To properly state a claim, a complaint must contain “a short and plain
statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ.
P. 8(a)(2). In Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S. Ct. 1955,
1974 (2007), the Supreme Court held that, in an antitrust case, a complaint must
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contain sufficient factual matter, accepted as true, to “state a claim to relief that is
plausible on its face.” In Ashcroft v. Iqbal, 556 U.S. __, 129 S. Ct. 1937, 1953
(2009), the Supreme Court held that the rule in Twombly applied beyond antitrust
cases to all civil actions. In Iqbal, the Supreme Court held that Rule 8(a) does not
require “detailed factual allegations,” but does demand “more than an unadorned,
the-defendant-unlawfully-harmed-me accusation.” Id., 129 S. Ct. at 1949(citations omitted). Although a court will take factual allegations in a complaint
as true, it does not have to accept legal conclusions, couched as factual
accusations, as true. Id., 129 S. Ct. at 1949-50. Courts considering motions to
dismiss should apply these principles by first eliminating any allegations in a
complaint that are merely legal conclusions, and then determining whether the
remaining factual allegations “plausibly give rise to an entitlement to relief.” Am.
Dental Ass’n v. Cigna Corp., 605 F.3d 1283, 1290 (11th Cir. 2010).
We affirm the dismissal of Counts 3 through 10 as to Atlantic Southern
Bank and RBC Centura Bank, as the only allegation in Kendall’s complaint as to
these defendants is that they loaned money for the Bedford Estates Development.
Kendall provides this Court with no law to support state law claims against a party
that is merely a lender. Thus, Kendall has failed to state a claim for relief against
the banks under Georgia law that is plausible on its face.
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With regard to Defendants Thaxton Road, Hathaway Development
Company, and Elite Engineering, the district court erroneously dismissed without
prejudice the majority of Kendall’s state law claims. In the complaint, Kendall
asserted that he was the occupier of the property located at 3810 Thaxton Road.
The veracity of this claim is undisputed. Dismissal, based on Kendall’s mistaken
legal conclusion that he was also the owner of the property was an erroneous
application of Twombly and Iqbal. The appropriate response to Kendall’s
incorrect assertion of ownership was to strike that legal conclusion from the
complaint and determine if the remaining factual allegations stated a claim for
which relief could be granted. See Am. Dental Ass’n, 605 F.3d at 1290. The
undisputed fact that Kendall occupied the allegedly damaged property was enough
for most of Kendall’s claims to survive. Specifically, the substantive law
governing Counts 3 through 10, with the exception of the riparian claim, Count 7,
allows for standing by occupiers of real property. See, e.g., Parker v. Scrap Metal
Processors, Inc., 386 F.3d 993, 1017 (11th Cir. 2004) (“[O]wnership or occupancy
is a necessary element of a claim for nuisance under Georgia law.”) (emphasis
added); Barber v. Steele, 211 S.E.2d 133, 134 (Ga. Ct. App. 1974) (“A trespasser
is one who . . . wrongfully enters upon property owned or occupied by another.”)
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(emphasis added).1 But see Ga. Code Ann. § 44-8-1 (2010) (“Running water
belongs to the owner of the land on which it runs; but the landowner has no right
to divert the water from its usual channel nor may he so use or adulterate it as to
interfere with the enjoyment of it by the next owner.”) (emphasis added).
Accordingly, with regard to Defendants Thaxton Road, Hathaway Development
Company, and Elite Engineering, we vacate and remand as to Counts 3 through 6
and Counts 8 through 10 of Kendall’s complaint.
II. CWA Claims
Kendall next appeals the district court’s dismissal of Counts 1 and 2 of the
complaint, claims under the CWA. Congress enacted the CWA in 1972 in order to
“restore and maintain the chemical, physical, and biological integrity of the
Nation’s waters.” 33 U.S.C. § 1251; S. Fla. Water Mgmt. Dist. v. Miccosukee
Tribe of Indians, 541 U.S. 95, 102, 124 S. Ct. 1537, 1541 (2004). The CWA
prohibits the discharge of pollutants into United States waters, except as
authorized by the statute. 33 U.S.C. § 1311(a). The statute expressly allows
citizens to serve the public as private attorneys general when they have suffered
injuries in violation of the Act. See Middlesex Cnty. Sewerage Auth. v. Nat’l Sea
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Notably, Defendants fail to respond to Kendall’s claim that he possesses standing
to sue as the occupier of the property.
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Clammers Ass’n, 453 U.S. 1, 16-17, 101 S. Ct. 2615, 2624 (1981).
A party need not be an owner of property to have standing to bring a citizen
suit under the CWA. In the instant case, Kendall alleges that he was injured in his
capacity as an occupant of the property. All that is required for standing under the
CWA is that the plaintiff suffered injury in violation of the Act. Thus, Kendall’s
complaint included sufficient facts to establish standing to bring a citizen suit
under the CWA, even without the support of his claim to ownership of the
property. As stated above, under Twombly and Iqbal, the appropriate response to
the incorrect assertion of ownership was to strike that legal conclusion from the
complaint, rather than dismissing the entire complaint. Accepting the remaining
allegations in the complaint as true and construing them in the light most favorable
to Kendall, Kendall’s complaint satisfied Iqbal and Twombly on the issue of
standing.
The CWA requires citizen plaintiffs to notify alleged violators of their intent
to sue at least sixty days before filing a complaint. 33 U.S.C. § 1365(b)(1)(A).
We review the sufficiency of such pre-suit notice de novo. Nat’l Parks and
Conservation Ass’n v. Tenn. Valley Auth., 502 F.3d 1316, 1328 (11th Cir. 2007).
This pre-suit notice must contain:
sufficient information to permit the recipient to identify the specific
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standard, limitation, or order alleged to have been violated, the activity
alleged to constitute a violation, the person or persons responsible for
the alleged violation, the location of the alleged violation, the date or
dates of such violation, and the full name, address, and telephone
number of the person giving notice.
40 C.F.R. § 135.3 (emphasis added). “The notice requirements are strictly
construed to give the alleged violator the opportunity to correct the problem before
a lawsuit is filed.” Nat’l Parks, 502 F.3d at 1329. “If a plaintiff fails to comply
with [the] notice requirement where it is applicable, the district court is required to
dismiss the action.” Nat’l Envtl. Found. v. ABC Rail Corp., 926 F.2d 1096,
1097-98 (11th Cir. 1991).
The district court’s finding that the notice to sue letter was defective on its
face was erroneous. A notice of intent to sue letter need not include every party
that might conceivably wish to join a suit; it only needs to identify the parties
bringing suit. See 40 C.F.R. § 135.3. Here, the notice of intent to sue letter
specifically identified Kendall and his wife, Angela Y. Dawson. Defendants
Thaxton Road, Hathaway Development Company, and Elite Engineering had
notice that Kendall and Dawson intended to bring suit, and the letter included the
plaintiff’s names, addresses, and telephone numbers. Kendall’s erroneous claim of
ownership of the property did not prevent Defendants from having clear notice of
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who was alleging the violations of the CWA. Likewise, it did not prevent
Defendants from taking steps to alleviate the alleged injury. Accordingly, both the
spirit of the statute and its technical requirements were met. We vacate and
remand the district court’s dismissal of Counts 1 and 2 of Kendall’s complaint as
to Thaxton Road, Hathaway Development Company, and Elite Engineering.
We affirm the district court’s dismissal of Counts 1 and 2 as to Smith and
Wilcox, as the notice letter was defective as to them. “[W]e may affirm a decision
by the district court on any adequate ground, even if it is other than the one on
which the district court actually relied.” Whitaker v. Am. Airlines, Inc., 285 F.3d
940, 947 (11th Cir. 2002) (quotation omitted). The notice letter was not sent to
Smith or Wilcox personally and nowhere mentioned Smith or Wilcox as possible
defendants in a lawsuit brought pursuant to the CWA. Consequently, they were
not given sufficient notice to correct the alleged problem or identify the possibility
of a lawsuit against them. Accordingly, we affirm the dismissal of Counts 1 and 2
as to Smith and Wilcox.
We also affirm the district court’s dismissal of Counts 1 and 2 as to Atlantic
Southern Bank and RBC Centura Bank, because, even if notice was proper, the
only allegation in Kendall’s complaint as to these defendants is that they loaned
money for the Bedford Estates development. Kendall has provided this Court with
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no law in support of the proposition that a CWA claim may be pursued against a
party that has merely provided financing to an alleged polluter. Thus, Kendall has
failed to state a claim for relief that is plausible on its face under the CWA against
the banks.
III. Motion to Amend Complaint
Kendall argues that the district court erred in denying his motion to amend
the complaint. We review the denial of a motion to amend a complaint for abuse
of discretion. Corsello v. Lincare, Inc., 428 F.3d 1008, 1012 (11th Cir. 2005) (per
curiam). The decision of a district court to enforce its pre-trial scheduling order is
also reviewed for an abuse of discretion. Sosa v. Airprint Sys., Inc., 133 F.3d
1417, 1418 (11th Cir. 1998) (per curiam).
A party may amend its pleading as a matter of course within 21 days after
serving it. Fed. R. Civ. P. 15(a)(1)(A). “In all other cases, a party may amend its
pleading only with the opposing party’s written consent or the court’s leave. The
court should freely give leave when justice so requires.” Fed. R. Civ. P. 15(a)(2).
Generally, “[w]here a more carefully drafted complaint might state a claim, a
plaintiff must be given at least one chance to amend the complaint before the
district court dismisses the action with prejudice.” Bryant v. Dupree, 252 F.3d
1161, 1163 (11th Cir. 2001) (alteration in original, citation omitted, emphasis
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added) (per curiam).
District courts are required to enter a scheduling order that limits the time to
join other parties and to amend the pleadings. Fed. R. Civ. P. 16(b). When a
party’s motion to amend is filed after the scheduling order’s deadline for such
motions, the party must show good cause for why leave to amend should be
granted. See Sosa, 133 F.3d at 1419. A district court may deny a motion to amend
on “numerous grounds, such as undue delay, undue prejudice to the defendants,
and futility of the amendment.” Maynard v. Bd. of Regents of the Div. of Univs.
of the Fla. Dep’t of Educ., 342 F.3d 1281, 1287 (11th Cir. 2003) (citation and
quotations omitted).
The district court properly found that Kendall’s motion to amend was
untimely. Kendall filed his motion over two months after the deadline set in the
district court’s scheduling order. Moreover, the facts with which Kendall wished
to amend his complaint were known to Kendall at the time he filed his initial
complaint. See Sosa, 133 F.3d at 1419 (providing that a relevant factor in finding
that a court did not abuse its discretion in denying leave to amend was that “the
information supporting the proposed amendment to the complaint was available to
[the plaintiff] even before she filed suit”). Because Kendall failed to establish
good cause for why leave to amend should be granted, and because the district
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court dismissed the complaint without prejudice, the district court did not abuse its
discretion by denying leave to amend. See Smith v. School Bd. of Orange Cnty,
487 F.3d 1361, 1366-67 (11th Cir. 2007) (per curiam) (holding that “where a party
files an untimely motion to amend, [we] must first determine whether the party
complied with Rule 16(b)’s good cause requirement,” before considering whether
“justice so requires” allowing an amendment). Accordingly, we affirm the district
court’s denial of Kendall’s motion for leave to amend.
IV. Motion to Disqualify and Motion for Costs
Because the district court’s dismissal of Kendall’s complaint was erroneous,
denial of Kendall’s motion to disqualify attorneys and his motion for cost of
service against Elite Engineering and Atlantic Southern Bank as moot was
premature. The district court should consider these motions on the merits on
remand.
VI. Motion for Default Judgment
Under the Federal Rules of Civil Procedure, “[w]hen a party against whom a
judgment for affirmative relief is sought has failed to plead or otherwise defend,”
the clerk shall enter a default against that party. Fed. R. Civ. P. 55(a). We review
a district court’s decision made in the course of managing its docket for an abuse
of discretion. See Young v. City of Palm Bay, Fla., 358 F.3d 859, 863-64 (11th
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Cir. 2004). The Federal Rules of Civil Procedure allow a court to set aside a
default “for good cause.” Fed. R. Civ. P. 55(c). A district court has “the power to
control and direct the cases on its docket,” including “the inherent power to
dismiss a case.” Burden v. Yates, 644 F.2d 503, 505 (5th Cir. Unit B May1981).
Dismissal of the default judgment on the basis that the complaint failed to
state a claim against Elite Engineering was erroneous and an abuse of discretion.
As stated above, the complaint did plead sufficient facts to establish standing at
the motion to dismiss stage. We leave it to the district court to consider on remand
whether, in light of this ruling, good cause exists to dismiss the default judgment
against Elite. See Fed. R. Civ. P. 55(c).
Upon review of the record and consideration of the parties’ briefs, we
vacate and remand in part, and affirm in part.
VACATED and REMANDED in part, AFFIRMED in part.2
2
Appellant’s request for oral argument is denied as moot.
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