Hardesty v. Sacramento Metro. Air Quality Mgmt. Dist., No. 2:10–cv–02414–KJM–KJN

• Court: United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Eastern District of California
• Citation: 307 F.Supp.3d 1010
• Docket Number: No. 2:10–cv–02414–KJM–KJN
• Decision Date: 31 March 2018
• Parties: Joseph HARDESTY, et al., Plaintiffs, v. SACRAMENTO METROPOLITAN AIR QUALITY MANAGEMENT DISTRICT, et al., Defendants.

307 F.Supp.3d 1010

Joseph HARDESTY, et al., Plaintiffs,
v.
SACRAMENTO METROPOLITAN AIR QUALITY MANAGEMENT DISTRICT, et al., Defendants.

No. 2:10–cv–02414–KJM–KJN

United States District Court, E.D. California.

Signed March 31, 2018

307 F.Supp.3d 1019

Christian J. Ward, PHV, Collin J. Cox, PHV, R. Paul Yetter, PHV, Robert K. Ellis, PHV, Pro Hac Vice, Houston, TX, George David Robertson, Anthony George Arger, Robertson, Johnson, Miller & Williamson, Jonathan J. Tew, PHV, Pro Hac Vice, Robertson, Johnson, Miller & Williamson, Reno, NV, Glenn W. Peterson, Millstone Peterson & Watts, LLP, Roseville, CA, Richard Manning Ross, Law Office of Richard M. Ross, Lincoln, CA, for Plaintiffs.

David G. Alderson, California Department Of Justice Office, Oakland, CA, Gregory P. O'Dea, Mark O'Dea, Longyear O'Dea and Lavra, Sacramento, CA, Derek Paul Cole, Cota Cole, LLP, Roseville, CA, Richard E. Morton, Haight Brown & Bonesteel LLP, Santa Ana, CA, Sharon Muir, Collins Collins Muir & Stewart, LLP, South Pasdena, CA, Ryan Patrick Harley, Collins Collins Muir & Stewart LLP, Oakland, CA, Ryan Eric Palumbo, Collins Collins Muir & Stewart LLP, Orange, CA, for Defendants.

ORDER

After a lengthy jury trial, the Hardesty and Schneider plaintiffs obtained a verdict

307 F.Supp.3d 1020

exceeding $100 million against defendant Sacramento County and three defendant county officials based on defendants' actions the jury determined caused the closure of the Hardestys' sand and gravel mine and violated plaintiffs' constitutional rights under the First, Fourth and Fourteenth Amendments. Defendants' Renewed Motion for Judgment as a Matter of Law ("Renewed JMOL Mot."), ECF No. 537, and Motion for a New Trial ("New Trial Mot."), ECF No. 538, are before the court. Plaintiffs oppose the motions, ECF Nos. 547–48, and defendants have replied, ECF Nos. 550–51. The court heard oral argument on the motions on October 31, 2017, and then submitted the matters. See ECF No. 554. After careful consideration, for the reasons below, the court DENIES both motions.

I. BACKGROUND

A. Factual Background

Between 2008 and 2012, California and Sacramento County regulators investigated reports that the Hardesty family was operating a sand and gravel mine illegally on the Schneider family's ranch. As a result of the investigations, regulators ordered the Hardesty and Schneider families to cease the mining operation; the Hardesty and Schneider families eventually complied. What happened during the four years from initial reports to closure of the mine forms the core of the case that went to trial.

According to plaintiffs, after a long period of regulatory disinterest, government officials were spurred to action not by their discovery of any actual legal violations, but by their desire to appease plaintiffs' competitors as well as state legislators and local politicians motivated by campaign contributions. Plaintiffs centrally allege the County recognized the Schneiders' historical right to continue mining on their property, also called a "vested right," as early as 1994, but that defendants then revoked that right in 2009 without any process and in violation of the Schneiders' procedural and due process rights. The regulatory action that followed culminated in the permanent shutdown of the mining operation. The Schneiders also allege defendants retaliated against them by dramatically increasing in 2012 the financial deposit necessary to continue operating the mine, after they filed this case in 2010.

Defendants' theory of the case was that the County never revoked plaintiffs' vested right, if they had any such right. Instead, in a series of hearings in 2010 and 2011, defendants merely determined that plaintiffs had expanded the mining operation beyond its permissible scope. The subsequent regulatory action, including requiring an amended reclamation plan and greater financial assurances, were required under state law and none of these actions were improperly motivated.

B. Procedural Background

Following extensive summary judgment practice, plaintiffs' case proceeded to trial against the following defendants: Sacramento County; Robert Sherry, a former Planning Director for the County; Roger Dickinson, a former member of the Sacramento County Board of Supervisors; and Jeff Gamel, a former Sacramento County Senior Planner and Aggregate Resources Manager. After a sixteen-day trial held from February 16 to March 16, 2017, the jury returned a unanimous verdict on plaintiffs' Fourteenth Amendment procedural and substantive due process claims and the Schneiders' additional claim resting on the First Amendment's right to petition clause. See Jury Verdict, ECF No. 469. The jury found the County, but not the individual defendants, violated plaintiffs' procedural due process rights, and awarded nominal damages of $1 to each

307 F.Supp.3d 1021

set of plaintiffs on these claims. Id. at 2–3. The jury found all defendants violated plaintiffs' substantive due process rights, and awarded $75 million to the Hardestys and $30 million to the Schneiders. Id. at 4–5. The jury found the County, but not the individual defendants, violated the Schneiders' right to petition the government for redress, and awarded the Schneiders $30,000 on this claim. Id. at 6. The jury also found each individual defendant's conduct was "malicious, oppressive, or in reckless disregard" of plaintiffs' rights, and awarded punitive damages in the following amounts: $25,000 against Dickinson, $1 million against Gamel, and $750,000 against Sherry, with Sherry's payment broken down as $500,000 for the Hardestys and $250,000 for the Schneiders. Id. at 7–8.

After plaintiffs had rested their case but before the jury returned its verdict, defendants filed three motions for judgment as a matter of law under Federal Rule of Civil Procedure 50(a). ECF Nos. 350, 353, 443. In the first motion, defendants asserted they were entitled to judgment as a matter of law because plaintiffs failed to pursue relief by way of writ in state court, the County Board of Supervisors' decision and Board of Zoning Appeals ("BZA") decisions had preclusive effect, the Hardesty plaintiffs were not entitled to notice related to the Hardestys' procedural due process claims, the Board of Supervisors' hearings complied with procedural due process, and plaintiffs' substantive due process claims failed. ECF No. 350 at 2–20.

In the second motion, defendants asserted defendants Dickinson and Sherry were not liable for conduct after 2010 and Dickinson was entitled to absolute immunity for his legislative acts and qualified immunity for his executive acts. ECF No. 353 at 2–4.

In the third and final Rule 50(a) motion, defendants contended plaintiffs lacked a federally protected property interest, plaintiffs received procedural due process, adequate state process precluded finding a violation of procedural due process, the only remedy for a due process violation was to order the process due, the Hardestys were not entitled to notice or alternately received actual notice of certain hearings, plaintiffs failed to exhaust remedies in state court, board determinations were entitled to preclusive effect, plaintiffs' substantive due process claims failed, all defendants were entitled to qualified immunity and Dickinson was entitled to absolute immunity for some of his conduct, no evidence permitted a reasonable jury to conclude defendants retaliated against plaintiffs, no evidence supported awarding punitive damages, and defendants are entitled to judgment as a matter of law on a Williamson Act Claim. ECF No. 443 at 17–88. These three motions preserved defendants' right to file a renewed motion for judgment as a matter of law. See Fed. R. Civ. P. 50(a)–(b).

On July 7, 2017, defendants filed a renewed motion for judgment as a matter of law and, in the alternative, for a new trial. See Renewed JMOL Mot., ECF No. 537; New Trial Mot., ECF No. 538. As noted, plaintiffs jointly opposed the motions. Renewed JMOL Opp'n, ECF No. 547; New Trial Opp'n, ECF No. 548. Defendants filed replies. Renewed JMOL Reply, ECF No. 550; New Trial Reply, ECF No. 551. On October 31, 2017, the court heard both motions: Derek P. Cole, Gregory P. O'Dea and Mark O'Dea appeared for defendants; R. Paul Yetter, Christian J. Ward and George D. Robertson appeared for the Hardestys; and Glenn W. Peterson appeared for the Schneiders. H'rg Mins., ECF No. 554; see Hr'g Tr., ECF No. 556. II.

307 F.Supp.3d 1022

LEGAL STANDARD

A. Motion for Judgment as a Matter of Law

Federal Rule of Civil Procedure 50(b) governs renewed motions for judgment as a matter of law ("JMOL"), which may be raised only after the court denies a Rule 50(a) motion for judgment made during trial. Rule 50(b) provides in pertinent part that the court may: "(1) allow judgment on the verdict, if the jury returned a verdict; (2) order a new trial; or (3) direct the entry of judgment as a matter of law." Fed. R. Civ. P. 52(b)(1)–(3). In rendering a Rule 50 motion decision, the court views the evidence in the light most favorable to the non-moving party and draws all reasonable inferences in favor of the non-moving party. Krechman v. Cty. of Riverside , 723 F.3d 1104, 1109 (9th Cir. 2013) (citing EEOC v....