Jonna Corp. v. City of Sunnyvale
| Decision Date | 09 November 2017 |
| Docket Number | Case No. 17-CV-00956-LHK |
| Parties | JONNA CORPORATION, Plaintiff, v. CITY OF SUNNYVALE, CA, Defendant. |
| Court | U.S. District Court — Northern District of California |
Plaintiff Jonna Corporation ("Plaintiff"), doing business as Premier Recycling, sues Defendant City of Sunnyvale ("the City") because the City refused to provide Plaintiff a license to collect construction and demolition debris in the City. Before the Court is the City's Motion to Dismiss the First Amended Complaint. ECF No. 34 ("Mot."). Having considered the submissions of the parties, the relevant law, and the record in this case, the Court GRANTS the City's Motion to Dismiss the First Amended Complaint.
In 1991, the City entered into an exclusive franchise agreement for the collection of solid waste in the City ("Exclusive Franchise Agreement") with Bay Counties Waste Services, Inc. ("Bay Counties"), formerly Specialty Solid Waste & Recycling, Inc., for a term of ten years. First Amended Complaint ("FAC"), ECF No. 33 at 9; ECF No. 35-1 at 16; Sunnyvale Ordinance No. 2771-04.1 The Exclusive Franchise Agreement has been amended and extended a number of times, and now extends through at least June 30, 2021. Sunnyvale Ordinance No. 2949-11. Under the Exclusive Franchise Agreement, Bay Counties is the sole collector of solid waste, including recyclable materials and construction debris, in the City. FAC at 9. The Sunnyvale Municipal Code forbids any party from collecting solid waste for a fee without a franchise or license. Sunnyvale Mun. Code § 8.16.150 (). Bay Counties is the only entity that has been awarded such a franchise or license. FAC at 9.
Plaintiff is a California corporation based in Santa Clara County that "is in the business of collecting discarded wood, metal, asphalt, concrete, and drywall from commercial construction and demolition sites" ("construction and demolition debris"). FAC ¶¶ 3, 5. On October 19, 2016, Plaintiff applied to the City for a franchise or license to collect construction and demolition debris under Sunnyvale Municipal Code § 8.16.090. Id. ¶ 17; see also Sunnyvale Mun. Code § 8.16.090 (). On November 7, 2016, the City denied Plaintiff's application for a franchise or license. FAC ¶ 18. The City's denial letter stated that Id.
On February 24, 2017, Plaintiff filed the instant suit. See ECF No. 1. Plaintiff asserted two causes of action: declaratory relief and mandamus. The declaratory relief cause of action was based on the following theories: (1) violation of the Takings Clause of the U.S. Constitution; (2) violation of the guarantee of substantive due process of Fifth and Fourteenth Amendments to the U.S. Constitution; (3) violation of the Equal Protection Clause in the Fourteenth Amendment of the U.S. Constitution and Article I, Section 7 of the California Constitution; (4) violation of the Commerce Clause of the U.S. Constitution; (5) the City's use of the wrong definition of "solid waste" under California law; and (6) violation of California Public Resources Code § 40059. Id. ¶¶ 26-31. Plaintiff's mandamus cause of action stated that the City had a mandatory duty to issue a franchise or license to Plaintiff under Sunnyvale Municipal Code § 8.16.090, and thus the Court should compel the issuance of such a license. Id. ¶¶ 32-34.
On March 4, 2017, the City filed a motion to dismiss the complaint. ECF No. 16. On April 18, 2017, Plaintiff filed an opposition. ECF No. 18. On April 25, 2017, the City filed a reply. ECF No. 19. On June 16, 2017, the Court granted the City's motion to dismiss after finding that Plaintiff had failed to satisfy the takings exhaustion requirement and had failed to allege that the City's exclusive franchise policy was arbitrary and capricious, as substantive due process would require. ECF No. 29 at 12-16. The Court also dismissed Plaintiff's equal protection theory based on Plaintiff's failure to plead that it was similarly situated to any other group that had been awarded a franchise or license and on Plaintiff's failure to adequately allege that the City's exclusive franchise policy was irrational. Id. at 16-20. The Court dismissed Plaintiff's dormant Commerce Clause theory because Plaintiff failed to adequately plead that the exclusive franchise policy discriminated against out-of-state interests or that it burdened interstate commerce. Id. at 25-26. Because the Court had dismissed all of the bases for declaratory relief over which it had original jurisdiction, the Court declined to exercise supplemental jurisdiction over Plaintiff's remaining state law theories for Plaintiff's declaratory relief cause of action andPlaintiff's mandamus cause of action, which was based on state law. Id. at 26-29.
The Court provided Plaintiff leave to amend its complaint within thirty days. ECF No. 29 at 29. The Court cautioned that "[f]ailure to file an amended complaint within 30 days or failure to cure the deficiencies identified in this Order will result in dismissal with prejudice of the claims dismissed in this Order." Id.
Plaintiff filed its First Amended Complaint on July 16, 2017. In the FAC, Plaintiff alleged a declaratory relief cause of action premised on the Takings Clause of the U.S. Constitution and the Fourteenth Amendment's guarantee of substantive due process. Plaintiff abandoned its Equal Protection Clause and Commerce Clause theories and also abandoned the mandamus cause of action.
The City filed a motion to dismiss on July 28, 2017. See Mot. The City also filed a request for judicial notice. ECF No. 35 ("RJN"). On August 11, 2017, Plaintiff filed an opposition and objections to the City's RJN. ECF No. 37 ("Opp."). In its opposition, Plaintiff withdrew its Takings Clause theory. Opp. at 2. The City replied on August 18, 2017. ECF No. 38 ("Reply").
Pursuant to Federal Rule of Civil Procedure 12(b)(6), a defendant may move to dismiss an action for failure to allege "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (internal citations omitted). For purposes of ruling on a Rule 12(b)(6) motion, the Court "accept[s] factual allegations in the complaint as true and construe[s] the pleadings in the light most favorable to the nonmoving party." Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008).
However, a court need not accept as true allegations contradicted by judicially noticeable facts, Shwarz v. United States, 234 F.3d 428, 435 (9th Cir. 2000), and the "[C]ourt may look beyond the plaintiff's complaint to matters of public record" without converting the Rule 12(b)(6) motion into one for summary judgment, Shaw v. Hahn, 56 F.3d 1128, 1129 n.1 (9th Cir. 1995). Nor is the Court required to assume the truth of legal conclusions merely because they are cast in the form of factual allegations." Fayer v. Vaughn, 649 F.3d 1061, 1064 (9th Cir. 2011) (per curiam) (quoting W. Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981)). Mere "conclusory allegations of law and unwarranted inferences are insufficient to defeat a motion to dismiss." Adams v. Johnson, 355 F.3d 1179, 1183 (9th Cir. 2004); accord Iqbal, 556 U.S. at 678. Furthermore, "'a plaintiff may plead [him]self out of court'" if he "plead[s] facts which establish that he cannot prevail on his . . . claim." Weisbuch v. County of Los Angeles, 119 F.3d 778, 783 n.1 (9th Cir. 1997) (quoting Warzon v. Drew, 60 F.3d 1234, 1239 (7th Cir. 1995)).
Under Rule 15(a) of the Federal Rules of Civil Procedure, leave to amend "shall be freely granted when justice so requires," bearing in mind "the underlying purpose of Rule 15 to facilitate decision on the merits, rather than on the pleadings or technicalities." Lopez v. Smith, 203 F.3d 1122, 1127 (9th Cir. 2000) (en banc) (ellipses omitted). However, a court "may exercise its discretion to deny leave to amend due to 'undue delay, bad faith or dilatory motive on part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party . . . , [and] futility of amendment.'" Carvalho v. Equifax Info. Servs., LLC, 629 F.3d 876, 892-93 (9th Cir. 2010) (alterations in original) (quoting Foman v. Davis, 371 U.S. 178, 182 (1962)).
The City has requested judicial notice of a range of legislative enactments including sections of the Sunnyvale Municipal Code, public record documents, and correspondence....
To continue reading
Request your trial