Roderick v. City of Gulfport, Miss.

• Decision Date: 09 August 2000
• Docket Number: No. 1:93CV568BRR.,1:93CV568BRR.
• Citation: 144 F.Supp.2d 622
• Parties: Byron RODERICK, d/b/a We Cash It, Plaintiff, v. CITY OF GULFPORT, MISSISSIPPI; Ed Twomey, Gulfport, Mississippi Detective, Individually and in His Official Capacity; George H. Payne, Jr., Gulfport, Mississippi Chief of Police, Individually and in His Official Capacity; and Leslie Staehle, Individually, Defendants.
• Court: U.S. District Court — Southern District of Mississippi

144 F.Supp.2d 622

Byron RODERICK, d/b/a We Cash It, Plaintiff, v. CITY OF GULFPORT, MISSISSIPPI; Ed Twomey, Gulfport, Mississippi Detective, Individually and in His Official Capacity; George H. Payne, Jr., Gulfport, Mississippi Chief of Police, Individually and in His Official Capacity; and Leslie Staehle, Individually, Defendants.

No. 1:93CV568BRR.

United States District Court, S.D. Mississippi, Southern Division.

August 9, 2000.

COPYRIGHT MATERIAL OMITTED

Earl L. Denham, Ralph Preston King, II, Denham & King, PLLC, Ocean

Springs, MS, Hal Templeton Fowlkes, Jr., Miller & Fowlkes, Biloxi, MS, for Byron Roderick dba We Cash It for plaintiff.

Jeffrey S. Bruni, City of Gulfport, Walter Wesley Teel, Meadows, Riley, Koenenn & Teel, Gulfport, MS, Peter W. Cleveland, Office of Attorney General, Jackson, MS, Harry P. Hewes, Harry P. Hewes, Attorney, Joseph R. Meadows, Karen Jobe Young, Meadows, Riley, Koenenn & Teel, Gulfport, MS, for defendants.

MEMORANDUM OPINION AND ORDER

BRAMLETTE, District Judge.

This matter is before the Court on Motion to Dismiss [docket no. 78-1] and Motion to Strike Plaintiff's Rule 7(a) Reply [docket no. 65-1] filed by the City of Gulfport, George H. Payne, Jr. and Ed Twomey; and Motion to Dismiss Amended Complaint [docket no. 66-1] and Motion to Strike Motion Response by Byron Roderick [docket no. 82-1] filed by defendant Leslie Staehle. Having carefully considered the motions, briefs, applicable statutory and case law, and being otherwise fully advised in the premises, the Court finds as follows:

I. SUMMARY OF FACTS

The Amended Complaint in this case sets out the following course of events: In 1993, the plaintiff, Byron Roderick, opened a check cashing enterprise known as "We Cash It" in Gulfport, Mississippi. At that time, the check-cashing business was not regulated in Mississippi, and legislation regulating the check cashing industry was apparently in the works. The plaintiff claims that defendant Leslie Staehle Lee [hereinafter "Staehle"], Special Assistant Attorney General, "was intimately involved in negotiations, conferences and legislative committee meetings regarding proposed legislation to regulate check-cashing businesses in Mississippi," and represented to him that the check-cashing business was legal in Mississippi.¹ After "We Cash It" opened for business, it was investigated by the Gulfport Police Department for possible violation of Mississippi's Racketeer Influenced and Corrupt Organization ["RICO"] Act² dealing with usurious loans, i.e., loans made at exorbitant rates of interest. The plaintiff claims that this investigation was based on testimony provided by defendant Staehle.

On or about October 22, 1993, several officers of the Gulfport Police Department executed a warrant for the search of the premises of "We Cash It." The plaintiff claims that the search warrant was based on Staehle's interpretation of the RICO statute in Mississippi. The police seized several items, including "all checks, business documents, video tape machines, calculators, telephones, filing cabinets" and the like. The police also posted a note on the plaintiff's door instructing customers to call the police department. According to the plaintiff, the police informed customers who called that the plaintiff's business was closed. Roderick immediately retained counsel, who telephoned the following individuals in the weeks that followed in an attempt to secure the return of the seized items: Harry Hewes, Gulfport City Attorney; Cono Caranna, Harrison County District Attorney; and Jim Halliday, Gulfport City Attorney. In addition, the plaintiff avers that his attorney placed several calls to Steve Simpson, Harrison County Assistant District Attorney, which were not returned.

On Tuesday, November 9, 1993, all items seized in the search other than the numerous checks that are the subject matter of the present controversy were returned to the plaintiff's business. Roderick maintains that the checks have an aggregate value of $47,000. On or about November 26, 1993, Roderick filed the instant action in this Court. On August 19, 1994, criminal proceedings were commenced against Roderick for violation of Mississippi's RICO Act relating to allegedly usurious loan practices. Thereafter, the instant case was placed on the inactive docket pending final determination of the criminal proceedings against Roderick. Roderick filed a Motion to Quash and Dismiss Indictments on May 30, 1995. On June 16, 1995, the trial judge granted Roderick's motion, holding that the Mississippi RICO statute is unconstitutionally vague when applied to claims of usury. The State appealed the decision to the Mississippi Supreme Court, which affirmed the Circuit Court's grant of Roderick's Motion to Quash and Dismiss on the grounds that the application of the RICO statute to usury would violate due process by criminalizing conduct without fair notice or warning.³ The State filed a petition for certiorari with the U.S. Supreme Court, which was denied on June 15, 1998.⁴

On July 15, 1998, the plaintiff's counsel reiterated his demand for the return of the checks. On July 24, 1998, defendant Staehle filed a Motion for Disposition of Evidence with the Circuit Court of Harrison County, requesting permission to return the plaintiff's property. The City of Gulfport filed a Motion to Intervene and for Protective Order, seeking to preclude the release of the plaintiff's property until the final disposition of the instant action. The court granted Staehle's motion, denied the City of Gulfport's motion and directed that the checks be returned to Roderick. According to the plaintiff, the checks have yet to be returned.

Roderick filed a Motion to Reinstate Case and a Motion to Amend Complaint, both of which were granted by Order entered July 26, 1999. On July 30, 1999, the Amended Complaint was filed. The Amended Complaint adds Leslie Staehle, formerly a non-party, as a party defendant. Roderick claims that the defendants' seizure and retention of the checks has forced him to close his business. The plaintiff seeks actual and compensatory damages of $2,500,000 for lost profits, loss of reputation, lost past, present and future income, libel and slander, litigation costs and attorney's fees and interest, as well as punitive damages of $2,500,000.⁵

II. MOTIONS TO DISMISS

A motion to dismiss under Rule 12(b)(6) "is viewed with disfavor and is rarely granted." Lowrey v. Texas A & M University System, 117 F.3d 242, 247 (5th Cir.1997); accord Kaiser Aluminum & Chem. Sales v. Avondale Shipyards, 677 F.2d 1045, 1050 (5th Cir.1982). The complaint must be liberally construed in favor of the plaintiff, and all facts pleaded in the original complaint must be taken as true. See Baker v. Putnal, 75 F.3d 190, 196 (5th Cir.1996) (citing McCartney v. First City Bank, 970 F.2d 45, 47 (5th Cir.1992)); Campbell v. Wells Fargo Bank, 781 F.2d 440, 442 (5th Cir.1986). "Although [the Court] must accept as true the well-pleaded allegations of a complaint" on motion to dismiss "for failure to state a claim, [the Court may] not accept as true conclusionary allegations in the complaint." Kaiser Aluminum & Chem. Sales, Inc. v. Avondale Shipyards, Inc., 677 F.2d 1045, 1050 (5th Cir.1982). A district court may not dismiss a complaint under Rule 12(b)(6) "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957); accord Blackburn v. Marshall, 42 F.3d 925, 931 (5th Cir.1995). The Fifth Circuit defines this strict standard by stating that "[t]he question ... is whether in the light most favorable to the plaintiff and with every doubt resolved in his behalf, the complaint states any valid claim for relief." Lowrey, 117 F.3d at 247 (citing Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure § 1357, at 601 (1969)). In addition, the Court is not permitted to look beyond the pleadings in the course of ruling on a motion to dismiss. See Baker, 75 F.3d at 196.

A. Plaintiff's Allegations of Constitutional Violations

The plaintiff claims a violation of his rights under the First, Fourth, Fifth and Fourteenth Amendments to the U.S. Constitution, and alleges civil conspiracy and violation of Sections 14, 24 and 25 of Article III of the Mississippi State Constitution. The Court will examine these allegations in turn.

1. First and Fifth Amendments

The plaintiff alleges a violation of his First Amendment right to assembly and association under the U.S. Constitution, but the Complaint fails to allege any facts to support a claim that he was prohibited from exercising these rights. The plaintiff has also alleged a violation of his rights under the Fifth Amendment; however, the Fifth Amendment applies only to the federal government and its officers, and is therefore inapplicable to the state actors in this case. See Jones v. City of Jackson, 203 F.3d 875, 880 (5th Cir.2000) ("The Fifth Amendment applies only to violations of constitutional rights by the United States or a federal actor.") (citing Morin v. Caire, 77 F.3d 116, 120 (5th Cir.1996)). Therefore, the defendants' motions to dismiss are well taken as to the plaintiff's First and Fifth Amendment claims.

2. Fourth Amendment

Roderick claims that the search and seizure conducted by the Gulfport Police Department at the premises of "We Cash It" violated his Fourth Amendment right to be free from unreasonable search and seizure. Defendants Payne, Twomey and Staehle contend that they are insulated from liability due to the fact that the search and seizure occurred pursuant to a valid search warrant issued by a Municipal Court Judge. In support of their contention, the defendants cite the following language of Smith v. Gonzales: "[I]f the facts supporting an arrest are put before an intermediary such as a magistrate or grand jury, the intermediary's decision to issue a...