Nichols v. Wayne Cnty.

• Decision Date: 18 August 2020
• Docket Number: No. 19-1056,19-1056
• Parties: STEPHEN NICHOLS, Plaintiffs-Appellant, v. WAYNE COUNTY, MICHIGAN; WAYNE COUNTY, MICHIGAN PROSECUTOR'S OFFICE; CITY OF LINCOLN PARK, MICHIGAN; KYM L. WORTHY, Defendants-Appellees.
• Court: U.S. Court of Appeals — Sixth Circuit

STEPHEN NICHOLS, Plaintiffs-Appellant, v. WAYNE COUNTY, MICHIGAN;

WAYNE COUNTY, MICHIGAN PROSECUTOR'S OFFICE;

CITY OF LINCOLN PARK, MICHIGAN;

KYM L. WORTHY, Defendants-Appellees.

No. 19-1056

UNITED STATES COURT OF APPEALS FOR THE SIXTH CIRCUIT

August 18, 2020

NOT RECOMMENDED FOR PUBLICATION

File Name: 20a0486n.06

ON APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF MICHIGAN

Before: MOORE, McKEAGUE, and LARSEN, Circuit Judges.

LARSEN, Circuit Judge. A police officer seized Stephen Nichols' car for its suspected involvement in a violation of Michigan's Identity Theft Protection Act. The car was detained in anticipation of civil forfeiture, but the prosecutor never instituted forfeiture proceedings. Nichols eventually got his car back after he filed an action against several local government entities, asserting, as relevant here, Monell liability under 42 U.S.C. § 1983. See Monell v. Dep't of Soc. Servs., 436 U.S. 658, 691 (1978). With his car returned to him, Nichols sought damages for the local governments' alleged failure to provide him with constitutional process. Specifically, he claimed that the Due Process Clause entitled him to an intervening hearing (after the seizure, but before any forfeiture hearing) at which he could have challenged the post-seizure detention of his car prior to and during any forfeiture proceedings. The district court disagreed and dismissed his complaint for failure to state a claim. We affirm because Nichols has failed to allege a municipal "policy or custom" sufficient to state a Monell claim under § 1983.

I.

Nichols' car was seized under Michigan's Identity Theft Protection Act (MITPA). Mich. Comp. Laws (MCL) §§ 445.61-.79d. MITPA prohibits the "use or [the] attempt to use the personal identifying information of another person" to "[o]btain credit, goods, services, money, property, a vital record, a confidential telephone record, medical records or information, or employment," or to "[c]ommit another unlawful act." MCL § 445.65(1). Any personal property "used, possessed, or acquired in a felony violation of [MITPA]" is subject to forfeiture. MCL § 445.79(1)(a).

The statute authorizes the state or a local government to seize forfeitable property either "upon process issued by the circuit court having jurisdiction over the property" or "without process" if, among other circumstances, there is probable cause to believe that the property "was used or is intended to be used in violation of [MITPA]." MCL § 445.79a. If the government seizes property without process and the property's total value "does not exceed $50,000.00," the government "shall notify the owner" of the seizure and of its intent to forfeit the property. MCL § 445.79b(1). If the owner does not contest the forfeiture within 20 days after receiving the notice, the local government "shall declare the property forfeited." MCL § 445.79b(1)(d).

If the owner contests the forfeiture, he may "file a written claim" and post a bond with the government within 20 days "after receipt of the notice." MCL § 445.79b(1)(c). That claim and bond are then "transmit[ted]" to the government's "prosecuting attorney." Id. The prosecuting attorney then "shall promptly institute forfeiture proceedings after the expiration of the 20-dayperiod." Id. Owners may seek to recover their seized property via "an order and judgment of the court having jurisdiction over the forfeiture proceedings." MCL § 445.79b(2).

II.

According to the allegations in Nichols' complaint, the events at issue here began when a City of Lincoln Park police officer asked Nichols for proof of auto insurance as part of a traffic stop. When the officer determined that the provided insurance certificate was invalid, he seized Nichols' car and gave him a notice form indicating that the car was subject to forfeiture under MITPA. The form explained that to contest the forfeiture Nichols would need to file a "claim of interest" with Lincoln Park and post a $250 bond with the Wayne County Prosecutor's Office. Nichols did so. Nichols was not charged with any criminal offense. Instead, he pleaded responsible in state court to the civil infraction of operating a motor vehicle without proof of insurance.

Under MITPA, the Wayne County Prosecutor's Office was required to "promptly institute forfeiture proceedings." MCL § 445.79b(1)(c). Yet, nearly three years later, the county had not done so, and Nichols' car had not been returned.¹ So Nichols filed a putative class action² in federal court, suing the City of Lincoln Park and Wayne County (the municipalities) under 42U.S.C. § 1983.³ He alleged that the municipalities had violated his and all similarly situated persons' due process rights through their "practice, custom, policy, and pattern of failing to provide prompt post-seizure, pre-forfeiture hearings in front of a neutral decision-maker." He sought damages as well as declaratory and injunctive relief.

Upon receiving notice of the lawsuit, Wayne County released Nichols' car to him, prompting Nichols to later voluntarily dismiss his claims for declaratory and injunctive relief. The county sought to have the damages claim dismissed as well, on the ground that Nichols had failed to state a claim under Federal Rule of Civil Procedure 12(b)(6). The county argued that state law dictated the scope of the county's forfeiture proceedings and that the county could not, therefore, be held liable for failing to provide a pre-forfeiture-proceeding hearing. In the alternative, the county argued that MITPA's "promptness" requirement satisfied due process.

The district court granted the motion to dismiss. Although it found that the municipalities do "not routinely provide post-deprivation, pre-forfeiture hearings for civil seizures," it concluded that the failure to provide such "an additional hearing d[id] not violate due process." The district court therefore dismissed Nichols' complaint for failure to state a claim.

Nichols timely appealed.

III.

We review de novo a district court's ruling on a Rule 12(b)(6) motion. Kaminski v. Coulter, 865 F.3d 339, 344 (6th Cir. 2017). When performing that review, we generally consider only thefacts alleged in the complaint. Berera v. Mesa Med. Grp., PLLC, 779 F.3d 352, 358 n.7 (6th Cir. 2015). We accept those allegations as true and consider any ambiguity in them in the light most favorable to the plaintiff, drawing all reasonable inferences in his favor. Kaminski, 865 F.3d at 344. But "[l]egal conclusions couched as factual allegations need not be accepted as true." Buddenberg v. Weisdack, 939 F.3d 732, 738 (6th Cir. 2019) (citing Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007)). To survive a motion to dismiss, therefore, Nichols "must allege facts that if accepted as true, are sufficient to state a claim to relief that is plausible on its face," Majestic Bldg. Maint., Inc. v. Huntington Bancshares, Inc., 864 F.3d 455, 458 (6th Cir. 2017) (citing Twombly, 550 U.S. at 555), and "are sufficient to 'raise a right to relief above the speculative level,'" Rayfield v. City of Grand Rapids, 768 F. App'x 495, 501 (6th Cir. 2019) (quoting Wesley v. Campbell, 779 F.3d 421, 427 (6th Cir. 2015)). "Threadbare recitals of the elements of a cause of action, supported by mere conclusory statements do not suffice." Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009); see also Bailey v. City of Ann Arbor, 860 F.3d 382, 388 (6th Cir. 2017) (explaining that "the plausibility standard of Twombly and Iqbal" applies to Monell claims); Rayfield, 768 F. App'x at 500-01 (applying the plausibility standard to a Monell claim).

IV.

To state a municipal-liability claim under § 1983, the plaintiff must allege the deprivation (1) of a right secured by the Constitution or laws of the United States, (2) that was directly caused by a municipal policy or custom. Hardrick v. City of Detroit, 876 F.3d 238, 243 (6th Cir. 2017).

Nichols does not seek damages from any individual actor for his role in the seizure and detention of his car.⁴ Instead, he has sued only the city and the county for depriving him of dueprocess by failing to provide a continued-detention hearing.⁵ But to prevail in a § 1983 suit against municipal defendants, Nichols must still allege, and ultimately prove, a constitutional violation: "if the plaintiff has suffered no constitutional injury, his Monell claim fails." North v. Cuyahoga County, 754 F. App'x 380, 389 (6th Cir. 2018) (citing City of Los Angeles v. Heller, 475 U.S. 796, 799 (1986) (per curiam)). Here, Nichols alleges that he was unconstitutionally deprived of a property interest—the possessory interest in his vehicle from the time of its seizure until its eventual return—without adequate process. To hold the municipalities liable under Monell, he must also allege, and ultimately prove, that the municipalities themselves, as opposed to any municipal employee, were responsible for the prolonged detention of his vehicle without process. Burgess v. Fischer, 735 F.3d 462, 478 (6th Cir. 2013). ("A municipality 'may not be sued under § 1983 for an injury inflicted solely by its employees or agents.'" (quoting Monell, 436 U.S. at 694)).

Constitutional Violation. The Fourteenth Amendment's Due Process Clause prohibits states from "depriv[ing] any person of . . . property, without due process of law." U.S. Const. amend. XIV, § 1. When state or local governments attempt to deprive an individual of his property, the Due Process Clause guarantees him an "opportunity to be heard" in "some form of hearing" "at a meaningful time and in a meaningful manner." Mathews v. Eldridge, 424 U.S. 319, 333 (1976) (quoting Armstrong v. Manzo, 380 U.S. 545, 552 (1965)).

Just when a hearing must be held to satisfy the "meaningful time" requirement varies depending on the kind of property the government seeks to seize. Although due process generally requires "predeprivation notice and hearing," in some "extraordinary situations," a "valid governmental interest . . . justifies...