Productions & Leasing v. Hotel Conquistador

• Decision Date: 13 October 1983
• Docket Number: Civ. No. LV-81-97
• Citation: 573 F. Supp. 717
• Parties: PRODUCTIONS & LEASING, etc., et al., Plaintiff, v. HOTEL CONQUISTADOR, INC., etc., et al., Defendants.
• Court: U.S. District Court — District of Nevada

573 F. Supp. 717

PRODUCTIONS & LEASING, etc., et al., Plaintiff, v. HOTEL CONQUISTADOR, INC., etc., et al., Defendants.

Civ. No. LV-81-97, HEC.

United States District Court, D. Nevada.

July 13, 1982.

Appendix Added to Opinion October 13, 1983.

COPYRIGHT MATERIAL OMITTED

Thomas F. Pitaro, Las Vegas, Nev., Stanley I. Greenberg, Los Angeles, Cal., for plaintiff Productions & Leasing.

Jay H. Brown, Las Vegas, Nev., for defendant Hotel Conquistador, dba Tropicana Hotel.

Dennis Kennedy, Lionel, Sawyer & Collins, Las Vegas, Nev., for defendants Hotel Ramada of Nevada, Ramada Inns and Howard Johnson.

Edwards, Hunt, Pearson & Hale, Las Vegas, Nev., Shearer, Fields & Shearer, Los Angeles, Cal., for defendant Deil O. Gustafson.

Marquis & Haney, Las Vegas, Nev., Reed, Goldstein & Jenkins-Reed, Phoenix, Ariz., for defendant M. William Isbell.

D. Brian McKay, Atty. Gen., State of Nev., Gaming Div., Las Vegas, Nev., for defendants Nevada Gaming Com'n and its members, and for Nevada Gaming Control Bd. and its members.

MEMORANDUM DECISION

CLAIBORNE, Chief Judge.

This matter is before the Court on a Motion to Dismiss Complaint and a Motion to Strike, filed April 17, 1981 and May 27, 1982, respectively, on behalf of the State Defendants, Nevada Gaming Commission, State Gaming Control Board, and certain of their members past and present.

The State Defendants move to strike the Plaintiff's Supplemental Points and Authorities in Opposition to Motion to Dismiss. The Plaintiff having failed to respond to the Motion to Strike, the Court hereby grants said motion pursuant to Rule 16(e) of the Rules of Practice of the United States District Court for the District of Nevada.

The State Defendants move for dismissal of the Complaint, as it pertains to said Defendants, pursuant to Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure. Said Defendants specifically attack the Eighth, Ninth and Tenth Claims for Relief, the only causes of action pertaining to said Defendants. The Eighth and Ninth Claims for Relief assert causes of action under Sections 1983 and 1985(3) of Title 42, respectively. The Tenth Claim for Relief asserts a cause of action arising from Sections 1961, 1962 and 1964 of Title 18.

ELEVENTH AMENDMENT GOVERNMENTAL IMMUNITY:

The Eleventh Amendment states:

The Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State.

Although by its own terms this Amendment only prohibits suits undertaken against a state by citizens of another state, it is well established that the Eleventh Amendment also provides immunity from suit by a state's own citizens. Employees of Dept. of Public Health and Welfare, Missouri v. Department of Public Health and Welfare, Missouri, 411 U.S. 279, 93 S.Ct. 1614, 36 L.Ed.2d 251 (1973); Parden v. Terminal Ry. of Alabama State Docks Department, 377 U.S. 184, 84 S.Ct. 1207, 12 L.Ed.2d 233 (1964).

It is clear that 42 U.S.C. § 1983 did not abrogate Eleventh Amendment sovereign immunity. In Quern v. Jordan, 440 U.S. 332, 99 S.Ct. 1139, 59 L.Ed.2d 358 (1979), the United States Supreme Court states:

... § 1983 does not explicitly and by clear language indicate on its face an intent to sweep away the immunity of the States; nor does it have a history which focuses directly on the question of state liability which shows that Congress considered and firmly decided to abrogate the Eleventh Amendment immunity of the states. (Id. 440 U.S. at 345, 99 S.Ct. at 1147.)

This analysis applies with equal force to 42 U.S.C. § 1985(3).

As for the applicability of governmental immunity to an action brought under 18 U.S.C. §§ 1962 and 1964, this Court is guided in United States v. Turkette, 452 U.S. 576, 580, 101 S.Ct. 2524, 2527, 69 L.Ed.2d 246 (1981), which stated:

In determining the scope of a statute, we look first to the language. If the statutory language is unambiguous, in the absence of "a clearly expressed legislative intent to the contrary, the language must ordinarily be regarded as conclusive." (Emphasis added.)

The legislative history of the RICO Act, as did the Civil Rights Act, fails to indicate that Congress considered and firmly decided to abrogate the Eleventh Amendment immunity of the States. The statutory language of the RICO Act is even less clear than the Civil Rights Act. One thing is clear: Section 1961 of Title 18 separately defines "state" and "person." The fact that a "state" is defined separately, coupled with the uncertainty of including a state within the definition of a "person" under the Act, forces the Court to conclude that the Act is ambiguous. Without a clear showing that Congress intended abrogation of the Eleventh Amendment governmental immunity, this Court will not infer that the RICO Act deprives the State of Nevada of its protection.

The Nevada Gaming Commission and the State Gaming Control Board have Eleventh Amendment governmental immunity from civil suits brought under 42 U.S.C. §§ 1983 and 1985(3), and 18 U.S.C. § 1964(c), which has been explicitly preserved by Nevada Revised Statute 41.031(3) (1977). See Rosenthal v. State of Nevada, 514 F.Supp. 907 (D.Nev.1981), Ginter v. State Bar of Nevada, 625 F.2d 829 (9th Cir.1980)....

ABSOLUTE IMMUNITY:

As for the past and present members of the Nevada Gaming Commission and State Gaming Control Board named in this action, they have absolute immunity from suits for civil damages. Rosenthal v. State of Nevada, supra. The issues of absolute and qualified immunity were most recently discussed by the United States Supreme Court in Nixon v. Fitzgerald, 457 U.S. 731, 102 S.Ct. 2690, 73 L.Ed.2d 349 (1982); 457 U.S. 800, 102 S.Ct. 2727, 73 L.Ed.2d 396 (1982). As stated in Harlow v. Fitzgerald, id. at n. 30:

This case involves no issue concerning the elements of the immunity available to state officials sued for constitutional violations under § 1983. We have found previously, however, that "it would be untenable to draw a distinction for purposes of immunity law between suits brought against state officials under § 1983 and suits brought directly under the Constitution against federal officials." Butz v. Economou, 438 U.S. 478 at 504 98 S.Ct. 2894 at 2909, 57 L.Ed.2d 895.

Our decision in no way diminishes the absolute immunity currently available to officials whose functions have been held to require a protection of this scope.

Therefore, the past and present members of the Nevada Gaming Commission and the State Gaming Control Board have absolute immunity from actions brought under § 1983, Rosenthal v. State of Nevada, supra, and § 1985(3), Friedman v. Younger, 282 F.Supp. 710, 716 (C.D.Cal.1968); Toscano v. Olesen, 189 F.Supp. 118, 119 (S.D.Cal. 1960).

As for the Plaintiff's claim under 18 U.S.C. § 1962, his civil action is brought pursuant to 18 U.S.C. § 1964(c), entitled "Civil Remedies," which states:

(c) Any person injured by reason of a violation of section 1962 of this chapter may sue therefor in any appropriate United States district court and shall recover threefold the damages he sustains and the costs of the suit, including a reasonable attorney's fee. (Emphasis added.)

While Rosenthal v. State of Nevada, Nixon v. Fitzgerald, and Harlow v. Fitzgerald dealt with immunity from suits brought under § 1983, the United States Supreme Court cases support the doctrine of immunizing certain state and federal officials from civil suits for damages resulting from conduct within the "outer perimeter" of the responsibilities, performance and function of those officials.

The Nevada Supreme Court spelled out its view of the gaming industry:

As before noted, gaming is a privilege conferred by the state and does not carry with it the rights inherent in useful trades and occupations. (Citations omitted.)

We view gaming as a matter reserved to the states within the meaning of the Tenth Amendment to the United States Constitution. Within this context we find no room for federally protected constitutional rights. This distinctively state problem is to be governed, controlled and regulated by the state legislature and, to the extent the legislature decrees, by the Nevada Constitution.

It is apparent that if we were to recognize federal protections of this wholly privileged state enterprise, necessary state control would be substantially diminished and federal intrusion invited.

State of Nevada v. Rosenthal, 93 Nev. 36, 44-45, 559 P.2d 830 (1977), appeal dismissed, 434 U.S. 803, 98 S.Ct. 32, 54 L.Ed.2d 61 (1977). Under NRS 463.220, the State Gaming Control Board presents the Nevada Gaming Commission with a recommendation as to issuance of a gaming license. The Nevada Gaming Commission:

has full and absolute power and authority to deny any application for any cause it deems reasonable. (NRS 463.220(7)). (Emphasis added.)

The Nevada Gaming Commission, aided by the State Gaming Commission, has the special and the "awesome responsibility of regulating the gaming industry and keeping undesirable elements out of the gaming industry," Rosenthal v. State of Nevada, supra, 559 P.2d at 914. The Board and Commission have broad authority and their members must have the reasonably unfettered ability to fulfill their responsibilities under the Nevada Gaming Control Act. See Gaming Regulation 3.080.

Therefore, the past and present members of the Nevada Gaming Commission and the State Gaming Control Board named in this suit are absolutely immune from a civil suit brought pursuant to 18 U.S.C. § 1964(c).

BURFORD ABSTENSION DOCTRINE:

The State Defendants move for the Court to abstain under Burford v. Sun Oil Co., 319 U.S. 315, 63 S.Ct. 1098, 87 L.Ed. 1424 (1943). This is known as the Burford Abstension Doctrine which allows the federal courts to refrain from ruling on an essentially local issue arising out of a complicated state regulatory scheme. As stated in ...