Ostergren v. Frick
| Decision Date | 30 March 2020 |
| Docket Number | Case No. 1:19-cv-139 |
| Parties | ERIC OSTERGREN, Plaintiff, v. HEATHER S. FRICK, et al., Defendants. |
| Court | U.S. District Court — Western District of Michigan |
Hon. Sally J. Berens
Plaintiff, Eric Ostergren, has sued Heather S. Frick, individually, and David A. Buick, in his official capacity as the Executive Director of the Michigan State Tax Commission, pursuant to 42 U.S.C. § 1983, alleging that Frick violated his First Amendment free speech and Fourteenth Amendment due process rights by: (1) requiring him to sign a Non-Disclosure Agreement (NDA) prohibiting the disclosure of Michigan Certified Assessing Officer training materials; and (2) using his violation of the NDA to threaten disciplinary action against him. Ostergren seeks damages against Frick and a permanent injunction against Buick. Defendants move for dismissal pursuant to Federal Rule of Civil Procedure 12(b)(6), arguing that Frick is entitled to qualified immunity on Ostergren's claim for damages. Defendants further argue that the Commission's post-complaint decision to discontinue use and enforcement of the NDA has mooted Ostergren's request or injunctive relief. Ostergren has responded, and Defendants have replied.1
For the following reasons, the Court will grant Defendants' motion in its entirety.2
Plaintiff Ostergren had a beef with the local assessor for Gerrish Township, where Ostergren owned a second home. (ECF No.37 at PageID.283.) Ostergren believed that the assessor was misapplying state law in assessing Ostergren's and other residents' properties. Because Ostergren was not an assessor, his public complaints fell on deaf ears. (Id.) Ostergren decided to level the playing field by becoming a Michigan Certified Assessing Officer (MCAO).
The Commission consists of three members appointed by the governor with the advice and consent of the senate. M.C.L.A. § 209.102(1). It is charged with the general supervision and administration of Michigan's property tax laws, as well as assisting and advising state assessing officers in the proper administration of Michigan's assessment and levying laws when necessary. M.C.L.A. § 209.104. The Commission is housed within the Department of Treasury and acts by a majority vote of its members. (ECF No. 33-1 (Executive Order No. 2009-51).) The Commission exercises its duties and functions independently of the State Treasurer. (Id. at PageID.263.)
The Commission is also responsible for educating, training, and certifying assessing officers, or MCAOs, who are generally employed by local units of government. M.C.L.A. § 211.10d. To obtain an MCAO certification, an applicant is required to complete coursework, either by attending classes or through the self-study program, and to pass an examination. (ECF Nos. 37-1, 37-2.)
Ostergren elected to pursue the self-study program. To participate in the self-study program, an applicant was required to submit a completed application and pay a $250 fee, $200 of which was for the self-study material and remaining $50 for the examination fee. (ECF No. 37-2.) The self-study materials covered nine major areas pertinent to assessment of property under Michigan law. (ECF No. 37 at PageID.284.) In addition, at the time Ostergren applied for the self-study program, applicants were required to sign a form NDA prohibiting disclosure of the course materials. (ECF No. 37-3 at Page ID.300.) The NDA provides:
(Id. at PageID.301.) Ostergren submitted his application, paid the fee, and signed the NDA. Thereafter, he took and passed the examination and was issued his MCAO certification. (ECF No. 37 at PageID.286.)
Armed with his MCAO certification, Ostergren again attempted to persuade Gerrish Township officials that the assessor was improperly re-assessing properties, to no avail. So, Ostergren took to the Internet and posted a portion of the MCAO self-study materials relating to re-assessing to his social media page. (Id.) In April 2018, Ostergren filed an administrative complaint with the Commission, complaining about improper assessment of property in GerrishTownship. Defendant Frick, the Commission's Executive Director at the time, responded to the complaint, denying it in full. (Id.)
In January 2019, the Commission learned about Ostergren's online posting of MCAO self-study materials in violation of the NDA. On January 15, 2019, Frick notified Ostergren by letter that the Commission's staff had recommended that Ostergren be referred to the Assessor Discipline Advisory Committee (ADAC) for an informal hearing to "weigh the information presented to them" and make a recommendation to the Commission regarding action against Ostergren's certification. (Id. at PageID.287; ECF No. 37-6.) The ADAC held the informal hearing on February 21, 2019. Following the hearing, the ADAC recommended that the Commission take no disciplinary action against Ostergren's certification. The Commission adopted the ADAC's recommendation at its April 8, 2019 meeting. .)
Ostergren filed his complaint in the instant case on February 24, 2019, in the period of time between the ADAC informal hearing and the Commission's April 8, 2019 adoption of the no-action recommendation. Ostergren sued only Frick in both her individual and official capacities. In its post-complaint June 11, 2019 meeting, the Commission unanimously approved a motion to discontinue use of the NDA in the assessor certification process and enforcement of existing NDAs. (ECF No. 37-10 at PageID.349.)
In May 2019, Defendant Buick was appointed to replace Frick as the Commission's Executive Director. (ECF No. 33-3.) On August 13, 2019, the Court granted Ostergren's motion to substitute Buick for Frick regarding the official capacity claim and ordered Ostergren to file a second amended complaint adding Buick in his capacity as Executive Director and dismissingOstergren's class allegations. (ECF No. 36.) Ostergren filed his second amended complaint on August 13, 2019. (ECF No. 37.)
Pursuant to Federal Rule of Civil Procedure 12(b)(6), a claim must be dismissed for failure to state a claim on which relief may be granted unless the "[f]actual allegations [are] enough to raise a right for relief above the speculative level on the assumption that all of the complaint's allegations are true." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 545 (2007). As the Supreme Court more recently held, to survive a motion to dismiss, a complaint must contain "sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 677-78 (2009). This plausibility standard "is not akin to a 'probability requirement,' but it asks for more than a sheer possibility that a defendant has acted unlawfully." If the complaint simply pleads facts that are "merely consistent with" a defendant's liability, it "stops short of the line between possibility and plausibility of 'entitlement to relief.'" Id. As the Court further observed:
Two working principles underlie our decision in Twombly. First, the 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. . .Rule 8 marks a notable and generous departure from the hyper-technical, code-pleading regime of a prior era, but it does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions. Second, only a complaint that states a plausible claim for relief survives a motion to dismiss. . . .Determining whether a complaint states a plausible claim for relief will, as the Court of Appeals observed, be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense. But where the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged - but it has not "show[n]" - "that the pleader is entitled to relief."
Id. at 678-79 (internal citations omitted).
When resolving a motion to dismiss pursuant to Rule 12(b)(6), the Court may consider the complaint and any exhibits attached thereto, public records, items appearing in the record of the case, and exhibits attached to the defendant's motion to dismiss provided they are referenced in the complaint and central to its claims. See Bassett v. National Collegiate Athletic Assoc., 528 F.3d 426, 430 (6th Cir. 2008).
Ostergren alleges two claims against Defendants. First, he contends that the NDA constituted an unlawful prior restraint in violation of the First Amendment. (ECF No. 37 at PageID.291 ().) Second, Ostergren alleges that the NDA violated his right to due process under the Fourteenth Amendment by conditioning his access to an MCAO certification upon the imposition of an unlawful...
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