People for the Ethical Operation Law Enforcement (P.E.O.P.L.E. v. Rackauckas

PEOPLE FOR THE ETHICAL OPERATION OF PROSECUTORSAND LAW ENFORCEMENT (P.E.O.P.L.E.),BETHANY WEBB, THERESA SMITH,and TINA JACKSON, Plaintiffs, v. ANTHONY J. RACKAUCKAS,in his official capacity as Orange County District Attorney,and SANDRA HUTCHENS, in her official capacity asOrange County Sheriff, Defendants.

Case No.: SACV 18-00805-CJC(JDEx)

UNITED STATES DISTRICT COURT CENTRAL DISTRICT OF CALIFORNIA SOUTHERN DIVISION

July 23, 2018

ORDER GRANTING PLAINTIFFS' MOTION TO REMAND

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I. INTRODUCTION & BACKGROUND

On April 4, 2018, Plaintiffs People for the Ethical Operation of Prosecutors and Law Enforcement ("P.E.O.P.L.E."), Bethany Webb, Theresa Smith, and Tina Jackson filed their Complaint against Defendants in Orange County Superior Court. (Dkt. 1 Ex. A [Complaint, hereinafter "Compl."].) Plaintiffs allege that the Orange County Sheriff's Department ("OCSD"), with the knowledge and participation of the Orange County District Attorney's Office ("OCDA"), has operated an illegal jailhouse informant program in the Orange County jails for over thirty years. According to Plaintiffs, "[l]arge numbers of 'professional' informants, working at the behest of both agencies, have interrogated criminal defendants in violation of those defendants' right to an attorney," and due process rights "by threatening violence to obtain the information they wanted." (Id. ¶¶ 2-3.) Informants allegedly were paid, both monetarily and with time off their own sentences, for this work. (Id. ¶ 4.) Plaintiffs allege that the OCSD and the OCDA have taken various measures, including lying under oath and suppressing evidence, to conceal the program. (Id. ¶ 5.)

Plaintiff Webb is an Orange County taxpayer whose sister was murdered by Scott Dekraai, whose murder case was tainted by the informant program. (Id. ¶ 15-17.) According to Plaintiffs, after Dekraai was charged with murder and was represented by counsel, OCSD moved him into a cell next to a longtime OCSD and OCDA informant in order to elicit information from Dekraai. (Id. ¶¶ 66-68.) After the informant reported statements Dekraai made about the crime, OCDA placed a tape recorder in the jail to record Dekraai and the informant's discussions, capturing over 100 hours of conversation. (Id. ¶¶ 68-70.) Plaintiffs further allege that the OCDA "went to great lengths to keep any information" relating to their use of an informant from Dekraai's defense counsel, and to conceal the informant program. (Id. ¶ 70.) Ultimately, the OCDA was disqualified from prosecuting Dekraai's case based on their failure to provideevidence to the defense. (Id. ¶¶ 110-22.) Plaintiffs Smith and Jackson are members of P.E.O.P.L.E., an association of Orange County citizens and taxpayers founded to combat the illegal and unconstitutional conduct of the OCDA and OCSD. (Id. ¶¶ 13-14, 18-21.) Plaintiffs seek redress for Defendants' alleged violations of the Federal and California Constitutions, as well as state statutes, arising out of this program. Defendant Anthony J. Rackauckas is the current District Attorney of Orange County, and Defendant Sandra Hutchens is the current Sheriff of Orange County. (Id. ¶¶ 22-23.)

The Complaint alleges that Plaintiffs have standing under California state law as taxpayers pursuant to California Code of Civil Procedure Section 526a, as well as to vindicate a substantial public interest in seeking a writ of mandamus pursuant to California Code of Civil Procedure Section 1085. (Id. ¶¶ 11, 13-21.) The Complaint further alleges that Plaintiffs "have suffered ongoing injuries necessitating relief" as a result of Defendants' alleged unconstitutional policies, practices, and customs, and seeks declaratory and injunctive relief to declare as unconstitutional and enjoin the alleged jailhouse informant program. (Id. ¶¶ 130, 135, 140, 144, 148, 152, 156, 160, 162.)

On May 8, 2018, Defendants removed the action to this Court on the basis of federal question jurisdiction, 28 U.S.C. § 1331. (Dkt. 1 [Notice of Removal, hereinafter "NOR"] ¶ 4.) Defendants asserted that the action "arises under 42 U.S.C. § 1983, the Federal Constitution, and the laws of the United States." (Id.) On June 13, 2018, Plaintiffs filed a motion to remand the action to Orange County Superior Court, arguing that removal was improper because Plaintiffs lack Article III standing, and the Court therefore lacks subject matter jurisdiction over this action. (Dkt. 28 [hereinafter "Mot."].) Plaintiffs are right. Because Plaintiffs have suffered no direct injury, they lack Article III standing to pursue their constitutional claims in federal court. The Court now must remand this action back to Orange County Superior Court for lack of subject matter jurisdiction. Accordingly, Plaintiffs' motion is GRANTED.

II. DISCUSSION

"If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded." 28 U.S.C. § 1447(c). "The district court generally must remand the case to state court, rather than dismiss it." Polo v. Innoventions Int'l, LLC, 833 F.3d 1193, 1196 (9th Cir. 2016) (citing Bruns v. Nat'l Credit Union Admin., 122 F.3d 1251, 1257 (9th Cir. 1997)). "Remand is the correct remedy" when a district court lacks subject-matter jurisdiction, because "the federal courts have no power to adjudicate the matter," while "[s]tate courts are not bound by the constraints of Article III." Id. (citing ASARCO Inc. v. Kadish, 490 U.S. 605, 617 (1989)). "[A] removed case in which the plaintiff lacks Article III standing must be remanded to state court under § 1447(c)." Id. (emphasis added); see Davidson v. Kimberly-Clark Corp., 889 F.3d 956, 970 n.6 (9th Cir. 2018) ("As a general rule, if the district court is confronted with an Article III standing problem in a removed case—whether the claims at issue are state or federal—the proper course is to remand for adjudication in state court."); Envtl. Research Ctr. v. Heartland Prod., 29 F. Supp. 3d 1281, 1283 (C.D. Cal. 2014) (remanding the action because the plaintiff lacked a cognizable Article III injury).

The Supreme Court has suggested that Section 1447(c) mandates remand absent a showing of futility.¹ Int'l Primate Prot. League v. Administrators of Tulane Educ. Fund, 500 U.S. 72, 89 (1991) ("[T]he literal words of Section 1447(c), which, on their face, give . . . no discretion to dismiss rather than remand an action. The statute declares that, where subject matter jurisdiction is lacking, the removed case 'shall be remanded.'")(citations omitted). Indeed, a majority of circuits have held that remand is mandatory pursuant to Section 1447(c) when the court lacks subject matter jurisdiction. See Hill v. Vanderbilt Capital Advisors, LLC, 702 F.3d 1220, 1226 (10th Cir. 2012) (collecting cases from the Second, Third, Fourth, Sixth, Seventh, Tenth, and Eleventh Circuits).

"A suit brought by a plaintiff without Article III standing is not a 'case or controversy,' and an Article III federal court therefore lacks subject matter jurisdiction over the suit." Cetacean Cmty. v. Bush, 386 F.3d 1169, 1174 (9th Cir. 2004) (citing Steel Co. v. Citizens for a Better Environment, 523 U.S. 83, 101 (1998)). To satisfy Article III's standing requirement, "a plaintiff must show (1) that it has suffered an 'injury in fact' that is (a) concrete and particularized and (b) actual or imminent, not conjectural or hypothetical; (2) the injury is fairly traceable to the challenged action of the defendant; and (3) it is likely, as opposed to merely speculative, that the injury will be redressed by a favorable decision." Friends of the Earth, Inc. v. Laidlaw Envtl. Servs. (TOC), Inc., 528 U.S. 167, 181 (2000). "Standing to sue in any Article III court is, of course, a federal question which does not depend on the party's . . . standing in state court." Phillips Petroleum Co. v. Shutts, 472 U.S. 797, 804 (1985); see Hollingsworth v. Perry, 570 U.S. 693, 715 (2013) ("[T]he fact that a State thinks a private party should have standing to seek relief for a generalized grievance cannot override our settled law to the contrary."). Defendants bear the burden of establishing Plaintiffs' Article III standing as the party asserting federal jurisdiction. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992). Defendants have not met this burden, nor do they even attempt to do so.²

It is apparent on the face of the Complaint that Plaintiffs lack Article III standing to sue in federal court because they have not suffered an "injury in fact." Plaintiffs allegethey have taxpayer standing under California law. See Cal. Civ. Proc. Code § 526a.³ Section 526a

permits a taxpayer to bring an action to restrain or prevent an illegal expenditure of public money. No showing of special damage to a particular taxpayer is required as a requisite for bringing a taxpayer suit. Rather, taxpayer suits provide a general citizen remedy for controlling illegal governmental activity.

Connerly v. State Pers. Bd., 92 Cal. App. 4th 16, 29 (2001) (citations omitted). While Section 526a confers "broad standing for taxpayers," it does not automatically confer Article III standing. Cantrell v. City of Long Beach, 241 F. 3d 674, 683 (9th Cir. 2001) (citing Blair v. Pitchess, 5 Cal. 3d 258, 268 (Cal. 1971)). Because Section 526 permits only injunctive relief, "taxpayer status, without more, does not suffice under Article III to demonstrate an injury in fact for purposes of such purely prospective relief." Id. at 684; see DaimlerChrysler Corp. v. Cuno, 547 U.S. 332, 346 (2006) ("[S]tate taxpayers have no standing under Article III to challenge state tax or spending decisions simply by virtue of their status as taxpayers.").

Plaintiffs also allege they have public interest standing for citizen suits seeking a writ of mandamus under California law. See Cal. Civ. Proc. Code §1085.⁴ "Citizen suits may be brought without the necessity of showing a legal or special interest in the result where the issue is one of public right and...