Incredible Invs., LLC v. Fernandez-Rundle

• Decision Date: 13 November 2013
• Docket Number: Case No. 13–22678–CIV.
• Citation: 984 F.Supp.2d 1318
• Parties: INCREDIBLE INVESTMENTS, LLC, Plaintiff, v. Katherine FERNANDEZ–RUNDLE, in her official capacity as State Attorney for Miami–Dade County, Florida, Defendant.
• Court: U.S. District Court — Southern District of Florida

984 F.Supp.2d 1318

INCREDIBLE INVESTMENTS, LLC, Plaintiff,

v.Katherine FERNANDEZ–RUNDLE, in her official capacity as State Attorney for Miami–Dade County, Florida, Defendant.

Case No. 13–22678–CIV.

United States District Court,

S.D. Florida.

Nov. 13, 2013.

Alan M. Dershowitz, Cambridge, MA, Victoria B. Eiger, New York, NY, Alan Jay Kluger, Justin Brett Kaplan, Kluger Kaplan Silverman Katzen & Levine PL, Miami, FL, for Plaintiff.

Jonathan A. Glogau, Allen C. Winsor, Attorney General's Office, Tallahassee, FL, for Defendant.

ORDER ON MOTION

URSULA UNGARO, District Judge.

THIS CAUSE is before the Court on Defendant's Motion to Dismiss. (D.E. 8.)

THE COURT has considered the motion and the pertinent portions of the record, and is otherwise fully advised of the premises.

BACKGROUND

Plaintiff owns or operates one or more internet cafés where consumers purchase the use of internet-capable terminals on a time-basis. Plaintiff alleges that it promotes its sales in part through Game Promotions which have now been prohibited by Fla. Stat. §§ 849.094 & 849.16 (2013). On June 28, 2013, Plaintiff filed a 19–count complaint in the Circuit Court for the Eleventh Judicial Circuit mounting a constitutional challenge to Fla. Stat. §§ 849.094 & 849.16 (2013). Plaintiff seeks declaratory relief under the following theories:

(i) Fla. Stat. § 849.094, which permits only nationally advertised Game Promotions and not locally advertised Game Promotions, violates the Equal Protection Clause of the United States and Florida Constitution (Counts I & II);

(ii) Fla. Stat. § 849.094 prohibits commercial speech in violation of the First Amendment of the Constitution and Art. I, Sec. 4 of the Florida Constitution because it bans Plaintiff from utilizing Game Promotions as a method by which to market and promote the sale of a service, i.e. internet usage, unless it nationally advertises its Game Promotions (Counts III & IV);

(iii) Fla. Stat. § 849.16 prohibits commercial speech in violation of the First Amendment of the Constitution and Art. I, Sec. 4 of the Florida Constitution because it proscribes the methods by which the Plaintiff may engage in commercial speech, namely its Game Promotions (Counts V & VI);

(iv) Fla. Stat. § 849.16 violates the First Amendment of the Constitution and Art. I, Sec. 4 of the Florida Constitution because it proscribes expressive conduct—here, Plaintiff's Game Display methods of communicating the results of its Game Promotions (Counts VII & VIII);

(v) Fla. Stat. § 849.16 proscribes expressive conduct—here, Plaintiff's Game Display methods of communicating the results of its Game Promotions—and in so doing, violates the First Amendment of the Constitution and Art. I, Sec. 4 of the Florida Constitution by interfering with Plaintiff's access to the internet to communicate information and ideas (Counts IX & X); (vi) Fla. Stat. § 849.16 includes a rebuttable presumption that imposes a prior restraint on protected speech, the sale or purchase of internet time on computers that display images of games of chance, in violation of the First Amendment of the Constitution and Art. I, Sec. 4 of the Florida Constitution (Counts XI & XII);

(vii) Fla. Stat. § 849.16 is unconstitutionally vague in violation of the Fifth Amendment of the Constitution and Art. I, Sec. 9 of the Florida Constitution because the definition of slot machine fails to adequately describe the prohibited machine or device such that a person of common understanding cannot know what is forbidden (Counts XIII & XIV);

(viii) Fla. Stat. § 849.16(3) creates an evidentiary presumption that relieves the State of Florida of its burden of persuasion beyond a reasonable doubt of every essential element of a crime in violation of the Due Process Clause of the Fifth Amendment to the Constitution and Art. I, Sec. 9 of the Florida Constitution (Counts XV & XVI);

(ix) Fla. Stat. § 849.16 is overbroad in violation of the First Amendment of the Constitution and the Florida Constitution because it covers both constitutional and unconstitutional applications and prohibits speech and expressive conduct, including the speech engaged in by Plaintiff in the form of the sweepstakes games (Counts XVII & XVIII); and

(x) Fla. Stat. § 849.16 is overbroad in violation of the Dormant Commerce Clause of the Constitution because it excessively regulates interstate commerce in relation to the putative local benefits (Count XIX).

On July 25, 2013, Defendant removed this action to this Court, pursuant to 28 U.S.C. §§ 1441(a) & 1446. On August 12, 2013, Defendant moved to dismiss the Complaint in its entirety pursuant to Fed.R.Civ.P. 12(b)(6). The motion is now fully briefed and ripe for review.

LEGAL STANDARD

On a Rule 12(b)(6) motion to dismiss a complaint for failure to state a claim, the Court takes the factual allegations in the complaint as true and construes them in the light most favorable to the plaintiff. Edwards v. Prime Inc., 602 F.3d 1276, 1291 (11th Cir.2010). Conclusory allegations will not suffice; the complaint must allege sufficient facts to state a plausible claim to relief. Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (“[T]he tenet that a court must accept as true all of the allegations contained in a complaint is inapplicable to legal conclusions. Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.”). This means that the factual content of the complaint must “allow[ ] the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. “Dismissal for failure to state a claim is proper if the factual allegations are not ‘enough to raise a right to relief above the speculative level.’ ” Edwards, 602 F.3d at 1291 (quoting Rivell v. Private Health Care Systems, Inc., 520 F.3d 1308, 1309 (11th Cir.2008)).

DISCUSSION

With respect to all claims, Plaintiff seeks relief under the Florida Declaratory Judgment Act, Fla. Stat. § 86.021, and with respect to the odd-numbered claims, Plaintiff also seeks relief under 42 U.S.C. § 1983. As a threshold matter, the Court will apply the federal Declaratory Judgment Act, not the Florida Declaratory Judgment Act, to this action. Under the Florida Declaratory Judgment Act, only “[t]he circuit and county courts have jurisdiction ... to declare rights, status, and other equitable or legal relations....” Fla. Stat. § 86.011. Additionally, in line with the recent trend among federal courts in Florida, the Court finds that Florida's Declaratory Judgment Act is procedural. See Nirvana Condo. Ass'n v. QBE Ins. Corp., 589 F.Supp.2d 1336, 1343 n. 1 (S.D.Fla.2008) (finding that Florida's Declaratory Judgment Act is a “procedural mechanism” and applying the federal Declaratory Judgment Act); 200 Leslie Condo. Ass'n v. QBE Ins. Corp., No. 10–61984–CIV, 2011 WL 2470344, at *5 (S.D.Fla. June 21, 2011). For these reasons, we construe the claims based on Florida's Declaratory Judgment Act as an action for declaratory relief pursuant to the federal Declaratory Judgment Act found at 28 U.S.C. § 2201.¹

The Declaratory Judgment Act provides that “[i]n a case of actual controversy within its jurisdiction ... any court of the United States, upon the filing of an appropriate pleading, may declare the rights and other legal relations of any interested party seeking such declaration, whether or not further relief is or could be sought.” 28 U.S.C. § 2201. In order to obtain declaratory relief under Section 2201, Plaintiff “must allege facts from which it appears there is a substantial likelihood that he will suffer injury in the future.” Walden, 669 F.3d at 1284. “Additionally, the continuing controversy may not be conjectural, hypothetical, or contingent; it must be real and immediate, and create a definite, rather than speculative threat of future injury.” Malowney v. Fed. Collection Deposit Grp., 193 F.3d 1342, 1347 (11th Cir.1999) (quoting Emory v. Peeler, 756 F.2d 1547, 1552 (11th Cir.1985)) (internal quotations omitted).

The Supreme Court has held that “where threatened action by government is concerned, ... a plaintiff [is not required] to expose himself to liability before bringing suit to challenge the basis for the threat—for example, the constitutionality of a law threatened to be enforced.” MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118, 128–29, 127 S.Ct. 764, 166 L.Ed.2d 604 (2007). Furthermore, “[t]he plaintiff's own action (or inaction) in failing to violate the law eliminates the imminent threat of prosecution, but nonetheless does not eliminate Article III jurisdiction ... because the threat-eliminating behavior was effectively coerced.” Id. at 129, 127 S.Ct. 764. “The dilemma posed by that coercion—putting the challenger to the choice between abandoning his rights or risking prosecution—is ‘a dilemma that it was the very purpose of the Declaratory Judgment Act to ameliorate.’ ” Id. (quoting Abbott Lab. v. Gardner, 387 U.S. 136, 152, 87 S.Ct. 1507, 18 L.Ed.2d 681 (1967)).

Construing the allegations in the Complaint as true and in the light most favorable to the Plaintiff, the Court concludes that the allegations are sufficient to satisfy the actual controversy requirement of 28 U.S.C. § 2201. Plaintiff need not continue to operate its business and expose itself to liability in order to challenge the constitutionality of the statutes. Plaintiff alleges that as a result of its fear of imminent enforcement of Fla. Stat. §§ 849.16²& 849.094, it has been forced to cease promoting the sale of internet access at its internet cafés using Game Promotions because: (i) Fla. Stat. § 849.094 only permits nationally advertised Game Promotions; (ii) pursuant to Fla. Stat. § 849.094(8)(b), Plaintiff's compliance with the rules of the Department of Agriculture and Consumer Services, the agency charged with promulgating rules and regulations respecting the operation of Game Promotions, is not a defense to a charge of...