Safe Streets Alliance v. Hickenlooper

859 F.3d 865

SAFE STREETS ALLIANCE; Phillis Windy Hope Reilly; Michael P. Reilly, Plaintiffs–Appellants,

v.John W. HICKENLOOPER, in his official capacity as Governor of Colorado; Barbara J. Brohl, in her official capacity as Executive Director of the Colorado Department of Revenue; James Burack, in his official capacity as Director of the Colorado Marijuana Enforcement Division; The Board of County Commissioners of the County of Pueblo; Pueblo County Liquor & Marijuana Licensing Board, Defendants–Appellees,andAlternative Holistic Healing, LLC, d/b/a Rocky Mountain Organic; Joseph R. Licata; Jason M. Licata; 6480 Pickney, LLC; Parker Walton ; Camp Feel Good, LLC; Roger Guzman; Blackhawk Development Corporation ; Washington International Insurance Co.; John Doe 1, Defendants.

State of Nebraska; State of Oklahoma, Intervenors.

State of Washington; State of Oregon; Robert A. Mikos; Sam Kamin; Douglas A. Berman; Robert J. Watkins; Alex Kreit, Amici Curiae.

Justin E. Smith; Chad Day ; Shayne Heap; Ronald B. Bruce; Casey Sheridan; Frederick D. Mckee; John D. Jenson; Mark L. Overman; Burton Pianalto; Charles F. Moser ; Paul B. Schaub; Scott DeCoste, Plaintiffs–Appellants,

v.John W. Hickenlooper, Governor of the State of Colorado, Defendant–Appellee.

State of Washington; State of Oregon; Robert A. Mikos; Sam Kamin; Douglas A. Berman; Robert J. Watkins; Alex Kreit, Amici Curiae.

Safe Streets Alliance; Phillis Windy Hope Reilly; Michael P. Reilly, Plaintiffs–Appellants,

v.Alternative Holistic Healing, LLC, d/b/a Rocky Mountain Organic; Joseph R. Licata; Jason M. Licata; 6480 Pickney, LLC; Parker Walton ; Camp Feel Good, LLC, Defendants–Appellees,andRoger Guzman; Blackhawk Development Corporation ; Washington International Insurance Co.; The Board of County Commissioners of the County of Pueblo; Pueblo County Liquor & Marijuana Licensing Board; John Doe 1, Defendants.

No. 16-1048

No. 16-1095

No. 16-1266

United States Court of Appeals, Tenth Circuit.

FILED June 7, 2017

Brian W. Barnes and David H. Thompson (Charles J. Cooper, Howard C. Nielson, Jr., and Peter A. Patterson, with them on the briefs), of Cooper & Kirk, PLLC, Washington D.C., for Plaintiffs-Appellants in Nos. 16-1048 and 16-1266.

Patrick R. Wyrick, Solicitor General of Oklahoma (E. Scott Pruitt, Attorney General of Oklahoma, and Mithun Mansinghani, Deputy Solicitor General, Office of the Oklahoma Attorney General, Oklahoma City, Oklahoma, Douglas J. Peterson, Attorney General of Nebraska, Ryan S. Post and David A. Lopez, Assistant Attorneys General, Office of the Nebraska Attorney General, Lincoln, Nebraska, with him on the briefs), for Intervenors, State of Oklahoma and State of Nebraska.

Matthew D. Grove, Assistant Solicitor General of Colorado (Cynthia H. Coffman, Attorney General, Claudia Brett Goldin, First Assistant Attorney General, Scott R. Bauer, Senior Assistant Attorney General, Sueanna P. Johnson, Assistant Attorney General, and Frederick R. Yarger, Solicitor General, with him on the brief), all of the Office of the Attorney General, Denver, Colorado, for Defendants-Appellees, John W. Hickenlooper, Barbara J. Brohl, and James Burack.

Matthew W. Buck, of The Cannabis Law Firm, Denver, Colorado, for Alternative Holistic Healing, LLC, d/b/a Rocky Mountain Organic, Joseph R. Licata, Jason M. Licata, 6480 Pickney, LLC, Parker Walton, and Camp Feel Good, LLC, Defendants-Appellees in No. 16-1266.

Paul V. Kelly, John J. Commisso, and Anne E. Selinger, of Jackson Lewis P.C., Boston, Massachusetts, filed a brief on behalf of Plaintiffs-Appellants in No. 16-1095.

Josh A. Marks and Melanie B. Lewis, of Berg Hill Greenleaf Ruscitti LLP, Boulder, Colorado, and Gregory J. Styduhar, Pueblo County Attorney, Pueblo, Colorado, filed a brief on behalf of Defendants-Appellees, Pueblo County Liquor & Marijuana Licensing Board and the Board of County Commissioners of the County of Pueblo, Colorado.

Robert W. Ferguson, Attorney General, Jeffrey T. Even, Deputy Solicitor General, and Bruce L. Turcott, Assistant Attorney General, State of Washington, Olympia, Washington, filed a brief on behalf of Amici Curiae, State of Washington and State of Oregon.

Michael Francisco, of MRDLaw, Denver, Colorado, and Robert A. Mikos, Professor of Law, Vanderbilt University Law School, Nashville, Tennessee, filed a brief on behalf of Amici Curiae, Law Professors in Support of the Respondent State of Colorado.

Before BRISCOE, HARTZ and HOLMES, Circuit Judges.

BRISCOE, Circuit Judge.

These three appeals arise from two cases that concern the passage, implementation, and alleged effects of Amendment 64 to the Colorado Constitution, Colo. Const. art. XVIII, § 16. Amendment 64 repealed many of the State's criminal and civil proscriptions on "recreational marijuana,"¹ and created a regulatory regime designed to ensure that marijuana is unadulterated and taxed, and that those operating marijuana-related enterprises are, from the State's perspective, licensed and qualified to do so. Of course, what Amendment 64 did not and could not do was amend the United States Constitution or the Controlled Substances Act (CSA), 21 U.S.C. §§ 801 –904, under which manufacturing, distributing, selling, and possessing with intent to distribute marijuana remains illegal in Colorado. See U.S. Const. art. VI, cl. 2. The three appeals at issue and two related motions to intervene raise four principal disputes stemming from the alleged conflict between the CSA and Colorado's new regime.

Two of the appeals were brought in Safe Streets Alliance v. Alternative Holistic Healing, LLC . First, in No. 16-1266, two Colorado landowners challenge the district court's dismissal of their claims brought under the citizen-suit provision of the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. § 1964(c), against certain affiliates of a State- and county-licensed marijuana manufactory that allegedly has injured the landowners' adjacent property. We conclude that the landowners have plausibly alleged at least one § 1964(c) claim against each of those defendants. We therefore reverse, in part, the dismissal of those claims and remand for further proceedings.

Second, in No. 16-1048, those landowners and an interest group to which they belong appeal the district court's dismissal of their purported causes of action "in equity" against Colorado and one of its counties for ostensibly also having injured the landowners' property by licensing that manufactory. The landowners and the interest group allege that Amendment 64's regime is preempted by the CSA, pursuant to the Supremacy Clause, U.S. Const. art. VI, cl. 2, and the CSA's preemption provision, 21 U.S.C. § 903.² We conclude that neither the landowners nor the interest group purport to have any federal substantive rights that have been injured by Colorado or the county's actions. And because they have no substantive rights in the CSA to vindicate, it follows inexorably that they cannot enforce § 903"in equity" to remedy their claimed injuries. We therefore affirm the dismissal of their preemption claims.

The third appeal, No. 16-1095, was filed in Smith v. Hickenlooper . In that case, a group of Colorado, Kansas, and Nebraska sheriffs and county attorneys sued Colorado on similar theories that Amendment 64's regime is preempted by the CSA. The district court dismissed their claims, and we consolidated the appeal with No. 16-1048. Because those plaintiffs also do not claim injuries to their federal substantive rights, we likewise affirm.

Finally, the States of Nebraska and Oklahoma moved to intervene in Safe Streets Alliance and Smith while they were pending on appeal. Those States claim that Amendment 64 injures their sovereign interests and those of their citizens, and that its enforcement is preempted by the CSA. We granted their motion in No. 16-1048 and heard their arguments, which confirmed that their controversy is with Colorado. Given that fact, we must confront 28 U.S.C. § 1251(a), which forbids us from exercising jurisdiction over controversies between the States. We therefore cannot permit Nebraska and Oklahoma to intervene, or even confirm that they have a justiciable controversy that may be sufficient for intervention. Consequently, we vacate the order granting intervention in Safe Streets Alliance and deny the States' motions in both cases.

I. Standards of Review

Before addressing each of those issues, we first discuss the applicable standards of review. The district court dismissed the claims before it on the basis of Federal Rules of Civil Procedure 12(b)(1) and (6). Rule 12(b)(1)"allows a court to dismiss a complaint for lack of subject matter jurisdiction. If the district court did so without taking evidence, as the court did here, our review is de novo." Pueblo of Jemez v. United States , 790 F.3d 1143, 1151 (10th Cir. 2015) (citing Becker v. Ute Indian Tribe , 770 F.3d 944, 946 (10th Cir. 2014) ). Such a "facial attack on the complaint's allegations as to subject matter jurisdiction questions the sufficiency of the complaint," and the "district court must accept the allegations in the complaint as true." Id. at 1148 n.4 (citation omitted). We also accept those factual allegations as true in conducting our de novo review. Id.

"Federal courts are courts of limited jurisdiction, possessing only that power authorized by Constitution and statute." Id. at 1151 (quoting Gunn v. Minton , 568 U.S. 251, 133 S.Ct. 1059, 1064, 185 L.Ed.2d 72 (2013) ). "[F]ederal subject matter jurisdiction is elemental," and "must be established in every cause under review in the federal courts." Id. (quoting Firstenberg v. City of Santa Fe , 696 F.3d 1018, 1022 (10th Cir. 2012) ). The "burden of establishing" a federal court's subject matter jurisdiction "rests upon the party asserting jurisdiction." Id. (citation omitted). "A court lacking jurisdiction cannot render judgment but must dismiss the cause at any stage of the proceedings in which it becomes apparent that jurisdiction is lacking." Id. (q...