Naperville Smart Meter Awareness v. City of Naperville

• Decision Date: 07 July 2015
• Docket Number: 11 C 9299
• Citation: 114 F.Supp.3d 606
• Parties: Naperville Smart Meter Awareness, an Illinois not-for-profit corporation, Plaintiff, v. City of Naperville, Defendant.
• Court: U.S. District Court — Northern District of Illinois

114 F.Supp.3d 606

Naperville Smart Meter Awareness, an Illinois not-for-profit corporation, Plaintiff,

v.City of Naperville, Defendant.

11 C 9299

United States District Court, N.D. Illinois, Eastern Division.

Signed July 7, 2015

Doug Elston Ibendahl, Attorney at Law, Chicago, IL, for Plaintiff.

Margo Lyn Ely, Robert R. Wilder, Kristen June Foley, City of Naperville, Naperville, IL, for Defendant.

MEMORANDUM OPINION AND ORDER

JOHN Z. LEE, United States District Judge

Naperville Smart Meter Awareness ("NSMA"), an Illinois not-for-profit corporation, has sued the City of Naperville ("the City") over the installation of smart meters in its members' homes. NSMA has moved for leave to file its Third Amended Complaint for Injunctive Relief in accordance with Federal Rule of Civil Procedure 15(a)(2). NSMA reasserts its claims pursuant to 42 U.S.C. § 1983, alleging violations of its members' rights to freedom from unreasonable search under the Fourth Amendment (Count I), and equal protection of the laws under the Fourteenth Amendment (Count III). NSMA also alleges violations of its members' rights to privacy and freedom from unreasonable search under the Illinois Constitution (Count II). For the following reasons, the Court grants in part and denies in part NSMA's motion for leave to file its Third Amended Complaint.

Factual Background

What follows is a brief summary of the allegations set forth in the proposed Third Amended Complaint.

NSMA is an Illinois not-for-profit corporation whose stated mission is to "educate, engage and empower families, friends and neighbors to advocate for a fiscally responsible and safe utility meter solution in Naperville, Illinois." 3d Am. Compl. ¶ 8. In Naperville, all residential electrical utility services are provided by the Department of Public Utilities–Electric, a company owned and operated by the local city government. Id. ¶ 16. In January 2012, the Naperville Department of Public Utilities–Electric began replacing its customers' analog electricity meters with smart meters as part of a local program called the Naperville Smart Grid Initiative. Id. ¶¶ 25, 155. The Naperville Smart Grid Initiative is funded in part by the U.S. Department of Energy, which received $4.5 billion of federal tax dollars under the American Recovery and Reinvestment Act of 2009 for the purpose of modernizing the nation's electrical power grid. Id. ¶ 25.

Like analog meters, smart meters can measure customers' total residential usage for monthly billing purposes. Id. ¶¶ 46–47. Unlike analog meters, smart meters are also equipped with wireless radio transmitters that, when activated, send usage data via radio-frequency waves to nearby neighborhood "network access points," which then relay usage data to Naperville's Department of Public Utilities–Electric. Id. ¶¶ 41–42. While analog meters are capable of measuring only total accumulated consumption of energy ("total kilowatt hours used over a month"), smart meters measure aggregate electricity usage much more frequently—in intervals of fifteen minutes that "include real power in kWH and reactive power in kVARh." Id. ¶¶ 31, 40. Smart meters have the ability to collect data consisting of "granular, fine-grained, high-frequency type of energy usage measurements" (so-called "Interval Data") totaling to "over thousands of intervals per month." Id. ¶¶ 35, 43.

NSMA alleges that Interval Data allows the City to collect more than just the aggregate data necessary for billing purposes previously available through analog meters. Id. ¶¶ 35, 44. The City also collects Interval Data from participants who voluntarily choose to partake in the Demand Response Program, which promotes the use of less electricity during periods of high demand. Id. ¶ 58.

As an alternative to having new smart meters installed in their homes, Naperville residents may opt to have their old analog meters replaced with "non-wireless meters." Id. ¶ 148. These "non-wireless meter alternatives" are essentially smart meters with their radio transmitters deactivated so that they emit no radio-frequency waves and must be read manually by a reader meter each month. See id. ¶ 149. Non-wireless meters are able to collect "the same highly detailed Interval Data" as smart meters. Id. Residents who choose the non-wireless meter alternative must pay a one-time installation fee of $68.35, plus an additional monthly fee of $24.75. Id. ¶ 150. NSMA describes the non-wireless meters as a "marginally lesser harm from among the two unsatisfactory alternatives." Id. ¶ 152.

NSMA asserts a number of concerns arising from the implementation of smart meters. Most notably, because smart meters are capable of taking data measurements in frequent, discrete increments, NSMA alleges that the smart meters present privacy risks that analog meters do not. Id. ¶ 73. Specifically, NSMA claims that a home's smart meter data history is capable of revealing "intimate details about the personal lives and living habits of NSMA members" and that an inspector of this detailed history can determine "when [residents] are away from home or asleep ... and [when they are using] different appliance[s]." Id. ¶¶ 74, 88, 90. NSMA posits that through the use of mechanisms such as "energy disaggregation software" and "intuitive observation," the City—and by extension law enforcement personnel—is capable of conducting an "intrusive search of the intimate details of NSMA members' in-home activities" that goes beyond assumptions or guesses.

Id. ¶¶ 64, 78, 81. NSMA also alleges that the radio-frequency waves that smart meters emit present health risks to Naperville residents. In support, it claims that radio-frequency waves have been "known to cause headaches, heart palpitations, ringing in the ears, anxiety, sleep disorders, depression, and other symptoms, particularly in individuals who suffer from electromagnetic sensitivity." Id. ¶ 123.

Earlier in this litigation, the Court granted the City's motion to dismiss NSMA's First Amended Complaint with leave to amend some of the counts therein. After so amending, the City again moved to dismiss the claims in the Second Amended Complaint. The Court granted in part and denied in part the City's second motion to dismiss NSMA's Second Amended Complaint.

NSMA now moves for leave to file a Third Amended Complaint. In Count I, NSMA alleges the City's collection of detailed smart meter data constitutes an unreasonable search of information under the Fourth Amendment. Id. ¶ 197. In Count II, NSMA also alleges that the City's collection of detailed smart meter data constitutes an unreasonable search and invasion of privacy under Article I, § 6 of the Illinois Constitution of 1970. Id. ¶¶ 214–15. In Count III, NSMA alleges that the City has violated its members' right to equal protection both by singling out NSMA members for an additional level of unequal treatment stemming from retaliatory motives, as well as by denying requests by NSMA members to retain analog meters for medical reasons while granting similar requests made by non-members. Id. ¶¶ 227–28. NSMA seeks an injunction ordering the City to make analog and non-wireless meters available at no additional cost upon customer request. Id. Prayer for Relief ¶ 1. Because the City does not oppose the motion with regard to Count III, the Court will solely address Counts I and II.

Legal Standard

Under the Federal Rules of Civil Procedure, a party may amend a complaint "with the opposing party's written consent or the court's leave," which "should [be] freely give[n]" when "justice so requires." Fed. R. Civ. P. 15(a)(2) ; see Soltys v. Costello, 520 F.3d 737, 743 (7th Cir.2008). Although Rule 15 provides for a liberal pleading standard, a district court may deny leave to amend for undue delay, bad faith, dilatory motive, prejudice, or futility. See Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962).

"A district court does not abuse its discretion in denying leave to amend if the proposed repleading would be futile...." Garcia v. City of Chi., 24 F.3d 966, 970 (7th Cir.1994) (internal citations omitted); see also Tribble v. Evangelides, 670 F.3d 753, 761 (7th Cir.2012) ("District courts have broad discretion to deny leave to amend ... where the amendment would be futile."). Futile repleadings include restating the same facts using different language, reasserting claims previously determined, and the inability to survive a motion to dismiss. See Garcia, 24 F.3d at 970 (internal citations omitted); Bower v. Jones, 978 F.2d 1004, 1008 (7th Cir.1992). The Court may also deny leave to amend for repeated failure to cure deficiencies by amendments previously allowed—such as failing to state a cognizable claim for relief. See Foman, 371 U.S. at 182, 83 S.Ct. 227 ; Adams v. City of Indianapolis, 742 F.3d 720, 734 (7th Cir.2014) (denial of motion to amend due to futility where the amended complaint was still "pleaded in wholly conclusory terms" and failed the "plausibility threshold.").

When the basis for denial is futility, the Court applies Rule 12(b)(6) to determine whether the proposed amended complaint fails to state a claim for relief. See Gen. Elec. Capital Corp. v. Lease Resolution Corp., 128 F.3d 1074, 1085 (7th Cir.1997). Under the federal notice pleading standard, a "plaintiff's complaint need only provide a short and plain statement of the claim showing that the pleader is entitled to relief, sufficient to provide the defendant with fair notice of the claim and its basis." Tamayo v. Blagojevich, 526 F.3d 1074, 1081 (7th Cir.2008) (internal quotations omitted). The Court must accept as true all well-pleaded allegations in the complaint and draw all possible inferences in NSMA's favor. Id. Mere legal conclusions, however, "are not entitled to the assumption of truth." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). NSMA's Third Amended Complaint must " ‘state a claim to relief that is plausible on its face ... [and] above the speculative...