Am. Honda Fin. Corp. v. Twp. of Aston

• Decision Date: 30 June 2021
• Docket Number: Civ. No. 20-3267
• Citation: 546 F.Supp.3d 371
• Parties: AMERICAN HONDA FINANCE CORP., Plaintiff, v. TOWNSHIP OF ASTON, et al., Defendants.
• Court: U.S. District Court — Eastern District of Pennsylvania

546 F.Supp.3d 371

AMERICAN HONDA FINANCE CORP., Plaintiff,

v.TOWNSHIP OF ASTON, et al., Defendants.

Civ. No. 20-3267

United States District Court, E.D. Pennsylvania.

Signed June 30, 2021

Nicholas A. Duston, Norris McLaughlin, P.A., Bridgewater, NJ, Rebecca J. Price, Norris, McLaughlin & Marcus, P.A., Allentown, PA, for Plaintiff.

Suzanne McDonough, Holsten & Associates, Media, PA, for Defendant The Township of Aston.

MEMORANDUM

DIAMOND, District Judge

American Honda Finance Corporation urges that municipalities should afford greater due process protections to lienholders whose vehicles those municipalities seize and impound. See, e.g., American Honda Finance Corp. v. City of Revere, 471 F.Supp.3d 399 (D. Mass. 2020). Given the frequency with which vehicles are leased or purchased on credit (with a lien usually provided to the financing entity), this is not an obscure issue. Here, Honda urges that the haphazard and dilatory manner in which Aston Township seized and impounded a car over which Honda had a lien caused the Company significant economic injury. In filings replete with misstatements, Aston insists that Honda's challenge is properly directed at state authorities alone. The record confirms, however, that Aston violated Honda's due process rights.

The Parties have cross-moved for summary judgment. I will grant Honda's Motion and deny that submitted by Aston.

JURISDICTION

Honda brings this action pursuant to 28 U.S.C. § 2201, 42 U.S.C. § 1983, and the Pennsylvania Constitution. The Court has jurisdiction to hear the federal claims under 28 U.S.C. § 1331 and supplemental jurisdiction to hear the state law claims under 28 U.S.C. § 1367.

LEGAL STANDARDS

Summary judgment is appropriate when "the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). The moving party must first show the absence of any genuine issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). An issue is "genuine" if there is evidence on which a reasonable fact finder could return a verdict for the nonmoving party. Kaucher v. Cty. of Bucks, 455 F.3d 418, 423 (3d Cir. 2006) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) ). A factual dispute is "material" if it might affect the case's outcome under governing law. Id. (citing Anderson, 477 U.S. at 248, 106 S.Ct. 2505 ). I must view facts and draw all reasonable inferences in the opposing party's favor, although "[u]nsupported assertions, conclusory allegations, or mere suspicions are insufficient to overcome a motion for summary judgment."

Betts v. New Castle Youth Dev. Ctr., 621 F.3d 249, 252 (3d Cir. 2010) ; see Anderson 477 U.S. at 255, 106 S.Ct. 2505.

If the moving party satisfies its burden, the opposing party must then show a disputed material factual issue. It is not enough simply to reiterate factual allegations or "show some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). Rather, the nonmoving party must establish a triable issue by "citing to particular parts of materials in the record, including depositions, documents, electronically stored information, affidavits or declarations, stipulations ..., admissions, interrogatory answers, or other materials," or by "showing that the materials cited do not establish the absence or presence of a genuine dispute." Fed. R. Civ. P. 56(c).

Finally, summary judgment is appropriate if the responding party fails to make a factual showing "sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex, 477 U.S. at 322, 106 S.Ct. 2548.

FACTS

I have construed all facts and resolved all disputes in Aston's favor.

The Seizure

On August 30, 2018, Aston Police stopped a black 2018 Honda Accord bearing New York plates. (Pl. SUMF ¶ 1, 13; Def. SUMF ¶ 5.) After a brief investigation, the police arrested the Accord's driver, Dale Bramble, and his three passengers for conspiring to steal from the U.S. mail. (Id.; Def. SUMF ¶ 5.) Police then directed Steve Luongo's Towing, Inc.—which serves as Aston's "police impound"–to tow the car from the scene. (Pl. SUMF ¶ 9, 14; Police Rep. 15 (referring to Luongo's as "police impound").) The "removal and impounding" of the Vehicle was authorized by Pennsylvania law:

(c) Removal to garage or place of safety.--Any police officer may remove or cause to be removed to the place of business of the operator of a wrecker or to a nearby garage or other place of safety any vehicle found upon a highway under any of the following circumstances:

[....]

(3) The person driving or in control of the vehicle is arrested for an alleged offense for which the officer is required by law to take the person arrested before an issuing authority without unnecessary delay.

75 P.S. § 3352(c)(3); (Doc. No. 27-18, Ex. C., Aston Inter. Resp. No. 1).

The Vehicle's Status

On June 6, 2018 Honda had perfected a lien over the Accord, which was publicly recorded by the New York State Department of Motor Vehicles. (Pl. SUMF ¶¶ 2-4; Donahue Declaration, Doc. No. 27-3, ¶¶ 3-7.) At the time of the August 30 seizure, Rayshon Smith was the Accord's owner. (Pl. SUMF ¶ 1, 6.) The record does not indicate how Bramble came into the car's possession. Earlier in August, Smith had defaulted on his required payments, entitling Honda to possession of the Accord when it was seized on August 30. (Id. at ¶ 5.) Smith nonetheless somehow transferred the Accord's title to Mango Towing, Inc. on October 10, 2018 (while it was still stored at Luongo's). (Id. at ¶ 6.) Despite this title transfer, Honda's lien remained. (Id. at ¶ 7.)

The Township's Relationship with Luongo's

Since at least 2010, the Township has contracted with Luongo's to provide towing services to the Aston Police. (Doc. No. 27-21, Ex. F., Luongo's Contract.) The contract provides that Luongo's will tow: "such motor vehicles as are determined to be abandoned"; "[vehicles which] must be towed because they are in violation of a Township ordinance or the laws of the Commonwealth of Pennsylvania;" and vehicles "having been involved in some crime or criminal activity." (Id.) The contract requires abandoned vehicles to be towed "within 72 hours of notification and the completion by the Township of any necessary forms." Other categories of vehicle must be towed within one hour of Township notification. (Id. at 2.) Luongo's may not seek payment from Aston for these towing services; instead, it charges fees to third parties. (Id. at 4) ("... [Luongo's] agrees that it shall not assert any claim against the Township for any fee or charge .... [Luongo's is] fully responsible for the collection of any and all costs and fees for their towing and storage ....").

Aston's Subsequent Actions

After it was towed, the Accord remained at Luongo's impound yard, accruing storage fees and depreciating in value, until Honda reached a settlement with Luongo's for the car's return on January 13, 2020. (Pl. SUMF ¶¶ 41-43; Doc. No. 26, Ex. M, Salvor's Application.)

According to Aston Police records, the Accord—which bore NY plates—had been at Luongo's for twenty-four days when, on September 23, 2018, Aston Police Officer Joseph Hart contacted the Binghamton, N.Y. Police, trying to notify the car's owner, Mr. Smith, of its seizure. (Doc. No. 27-24, Ex. I, Aston Police Log 14.) Binghamton Police could not find Mr. Smith at his recorded residence. (Id.) The following day, September 24, Aston Police Sgt. Chad Osborne "confirmed" that because the car "was not claimed from police impound," he had "completed a PA 952 form for the abandoned vehicle." (Id.) Osborne was less than honest in "complet[ing]" the "form".

The "PA 952 form" is titled "POLICE REQUEST FOR REMOVAL OF ABANDONED VEHICLE". (Doc. No. 27-25, Ex. J, 952 Form.) Although Osborne completed the form on September 23, 2018, he back-dated it to August 30, the day of the seizure. (Id.) He described the Accord as a "hazard," and gave its "location" as the place where it was seized weeks earlier (not Luongo's impound yard). (Id.) Osborne also wrote that the car "has been declared abandoned by the [Aston] Police Department ... [which] requested ... [Luongo's] to remove it." (Id.) Osborne thus completed the Form so that it would appear as a Police ‘request’ for Luongo's to tow a very recently abandoned vehicle. To be truthful and accurate, however, Osborne should have acknowledged that the car had been seized and towed incident to arrest and, weeks later, declared presumptively abandoned. Not coincidentally, through his misrepresentations, Osborne made it appear that Aston had complied with the Pennsylvania Department of Transportation's requirement that "Form MV-952 must be submitted to PennDOT within 48 hours from the date of tow. " Pa. Salvor Manual, PA DOT 14 (emphasis added).

Remarkably, Aston admits that Osborne followed the Township's standard practice in his handling of the Accord. (See Aston Inter. Resp. No. 4 ("Aston Township police practice with respect to the vehicle in question was standard ....").) Compounding Osborne's misstatements, Aston urges that a Pennsylvania statute required the Township to declare the Accord abandoned when it did. See 75 Pa.C.S.A. § 7303.1 (Duty of police and salvors); (Aston Inter. Resp. No. 3 ("... the Township completes a required Commonwealth form 952 which is submitted to the Commonwealth at which point the Commonwealth takes over the function of making notifications to owners and lienholders ....").) Once again, this is simply untrue: § 7303.1 does not apply in the circumstances presented here. Rather, it governs requests by police for "licensed salvor[s]" to "remove, possess and further process" abandoned vehicles. It says nothing about mischaracterizing a vehicle seizure...