Apartment of Ass'n of Greater L. A. v. City of Los Angeles

1

APARTMENT OF ASSOCIATION OF GREATER LOS ANGELES, in its representative capacity on behalf of its association members; et al., Plaintiffs-Appellants, v. CITY OF LOS ANGELES, a municipal corporation; DOES, 1 through 10 inclusive, Defendants-Appellees.

No. 21-55623

United States Court of Appeals, Ninth Circuit

August 16, 2022

NOT FOR PUBLICATION

Argued and Submitted April 4, 2022 Pasadena, California

Appeal from the United States District Court for the Central District of California D.C. No. 2:20-cv-04479-ODW-JEM Otis D Wright II, District Judge, Presiding

Before: SCHROEDER, S.R. THOMAS, and BEA, Circuit Judges.

MEMORANDUM ^[*]

Two trade organizations and a member from each-Apartment Association of Greater Los Angeles, City of Los Angeles AIHM Hotel/Motel Association, Balubhai Patel, and Harold Greenberg (collectively, "Plaintiffs")-brought a civil rights action pursuant to 42 U.S.C. § 1983 against the City of Los Angeles ("LA" or the "City") which challenged the constitutionality of LA's Municipal Ordinance No. 182986 (the "Ordinance"). The district court dismissed Plaintiffs' first amended complaint with prejudice. We have jurisdiction under 28 U.S.C. § 1291 and affirm, except that we vacate the district court's dismissal of Plaintiffs' Fourth Amendment claim with prejudice and direct the district court to dismiss that claim for lack of Article III standing without prejudice.

I.

Plaintiffs allege that the Ordinance requires commercial establishments and multifamily dwellings to subscribe to and pay for waste collection services; provides that the City may award exclusive franchise agreements for the provision of waste collection services to commercial establishments and multifamily buildings; and makes it unlawful for anyone to provide collection services to commercial establishments and multifamily dwellings unless that person has a written franchise agreement with the City.^[1], ^[2]

A.

The district court properly dismissed Plaintiffs' claim that the Ordinance violated the Fourth Amendment's prohibition on unreasonable searches because Plaintiffs failed to allege facts sufficient to establish Article III standing. Plaintiffs' Fourth Amendment claim was predicated on a "show-your-receipt" requirement that the Ordinance added to the Los Angeles Municipal Code ("LAMC"):

[T]he manager or person in charge of, or in control of, any solid waste of any residential premises or commercial establishment shall furnish written proof, whether in the form of contracts or receipts, to any appropriate municipal authority on request that said premises maintains collection services that collects solid waste generated from said premises in a manner in keeping with current health regulations and in compliance with the requirements of this Article and other provisions of the Los Angeles Municipal Code.

LAMC § 66.17.1.

"An 'injury in fact' as needed for Article III standing must be '(a) concrete and particularized, and (b) actual or imminent, not conjectural or hypothetical.'" Skyline Wesleyan Church v. Cal. Dep't of Managed Health Care, 968 F.3d 738, 747 (9th Cir. 2020) (citation omitted). Where, as here, Plaintiffs seek to challenge a policy that has not yet been enforced against them, Plaintiffs must establish a "genuine threat of imminent prosecution." Thomas v. Anchorage Equal Rts. Comm'n, 220 F.3d 1134, 1139 (9th Cir. 2000) (citation omitted); see also Unified Data Servs., LLC v. Fed. Trade Comm'n, 39 F.4th 1200, 1210 (9th Cir. 2022).

"[N]either the mere existence of a proscriptive statute nor a generalized threat of prosecution satisfies the 'case or controversy' requirement." Thomas, 220 F.3d at 1139 (citation omitted). "In evaluating the genuineness of a claimed threat of prosecution, we look to [1] whether the plaintiffs have articulated a 'concrete plan' to violate the law in question, [2] whether the prosecuting authorities have communicated a specific warning or threat to initiate proceedings, and [3] the history of past prosecution or enforcement under the challenged statute." Id. (citation omitted).

Plaintiffs' operative complaint falls far short of alleging a genuine threat of imminent prosecution. Plaintiffs allege that because they "are subject to the ordinance," they would be "required to furnish written proof . . . to the City upon request." Plaintiffs also allege that they "are subject to [LAMC] section 11.00[,] which imposes severe criminal and civil penalties for anyone who violates provisions of the LAMC." But Plaintiffs do not allege that any "municipal authority" has ever "request[ed]" that Plaintiffs or any of their members "furnish written proof" of compliance with the Ordinance. LAMC § 66.17.1. Plaintiffs also fail to allege that the "show-your-receipt" requirement has ever been enforced against anyone (or has ever been threatened to be enforced, or that anyone has ever been warned about the possibility of enforcement). Plaintiffs do not even allege that, if written proof were requested by an "appropriate municipal authority," they would refuse to "furnish" it.^[3]

B.

The district court properly dismissed Plaintiffs' due process claim. Plaintiffs argue that "[t]he failure of the ordinance to provide any hearing process in demanding records before imposing civil or criminal penalties under the ordinance . . . violates fundamental procedural due process principles" under the familiar three-part balancing test of Matthews v. Eldridge, 424 U.S. 319 (1976). But Plaintiffs have not alleged that any civil or criminal penalties have been imposed against them or that any authority has ever demanded records from them. Thus, for the same reasons that Plaintiffs do not have standing to bring their Fourth Amendment challenge, they do not have standing to argue that their due process rights have been violated.^[4]

C.

The district court properly dismissed Plaintiffs' taking claim brought under the Fifth and Fourteenth Amendments. First, Plaintiffs have failed to allege facts sufficient to state a claim that the Ordinance results in a physical invasion of their property. Plaintiffs allege that the amount they pay third-party waste collection services has increased following the passage of the Ordinance. But Plaintiffs do not allege that the Ordinance causes money to be "transferred from the [Plaintiffs] to the [City]." See Horne v. Dep't of Agric., 576 U.S. 350, 361 (2015).

Second, Plaintiffs have failed to allege facts sufficient to state a regulatory taking claim under Penn Central Transportation Co. v. City of New York, 438 U.S. 104 (1978). "Penn Central instructs us to consider [1] the regulation's economic impact on the claimant, [2] the extent to which the regulation interferes with distinct investment-backed expectations, and [3] the character of the government action." Colony Cove Props., LLC v. City of Carson, 888 F.3d 445, 450 (9th Cir. 2018) (citation and internal quotation marks omitted). Plaintiffs allege that due to the Ordinance their trash hauling expenses have increased 200-400% as compared to their expenses before the adoption of the Ordinance. But an ordinance that results merely in the doubling or quadrupling of trash hauling expenses associated with ownership of real property does not constitute a regulatory taking. See id. at 451 ("[D]iminution in property value because of governmental regulation ranging from 75% to 92.5% does not constitute a taking."). The district court correctly reasoned that those who buy into ownership of commercial buildings or multifamily residences cannot reasonably expect never to be subject to regulation regarding waste disposal. See Hybud Equip. Corp. v. City of Akron, Ohio, 654 F.2d 1187, 1192 (6th Cir. 1981) ("Courts in literally hundreds of reported cases have upheld the authority of local governments to monopolize and control local garbage collection by eliminating or restraining competition among private collectors."), judgment vacated on other grounds, 455 U.S. 931 (1982).

D.

The district court properly dismissed Plaintiffs' Equal Protection Clause claim. Plaintiffs argue that the Ordinance violates the Equal Protection Clause because the Ordinance denies the owners of multi-unit residential buildings and commercial establishments the "right to contract in the open marketplace" for solid waste collective services, but "[t]his barrier . . . does not apply to single family barriers [sic] under the ordinance under §66.03b."

But "[s]ocial and economic legislation . . . that does not employ suspect classifications or impinge on fundamental rights must be upheld against equal protection attack when the legislative means are rationally related to a legitimate governmental purpose." Hodel v. Indiana, 452 U.S. 314, 331 (1981). Plaintiffs have provided no authority for the proposition that owners of multi-unit residential buildings and commercial establishments are members of a suspect class or that the Ordinance impinges a fundamental right. The district court correctly concluded that "the Ordinance's classification easily passes the rational basis standard of review." As the Ordinance states at § 66.33, the Ordinance seeks to ensure that solid waste is "transported and processed in a manner that reduces environmental and social impacts on the City" and the Ordinance imposes requirements specifically on commercial and multifamily buildings because those buildings "'produce most of the City's solid waste,' and 'a significant amount [of commercial and multifamily solid waste . . ., including recyclables and organics,] is going to landfills, resulting in unnecessary greenhouse gas emissions.'"

II.

"We review for abuse of discretion a district court's decision to dismiss with prejudice." Missouri ex rel. Koster v. Harris, 847 F.3d 646, 656 (9th Cir. 20...