V. W. v. City of Vallejo, CIV. S-12-1629 LKK/GGH

• Decision Date: 01 August 2013
• Docket Number: NO. CIV. S-12-1629 LKK/GGH,CIV. S-12-1629 LKK/GGH
• Parties: V. W., a minor, by and through her Guardian Ad Litem, Tenaya Barber, Individually and as Successor in Interest of Decedent MICHAEL WHITE, Plaintiffs, v. CITY OF VALLEJO, a municipal corporation; ROBERT NICHELINI, in his individual and official capacity as Chief of Police; Officers Does 1-25, individually, jointly and severally, Defendants.
• Court: U.S. District Court — Eastern District of California

V. W., a minor, by and through her Guardian Ad Litem, Tenaya Barber, Individually and as Successor in Interest of Decedent MICHAEL WHITE, Plaintiffs, v. CITY OF VALLEJO, a municipal corporation; ROBERT NICHELINI in his individual and official capacity as Chief of Police Officers Does 1-25, individually, jointly and severally, Defendants.

NO. CIV. S-12-1629 LKK/GGH

UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF CALIFORNIA

DATED: August 1, 2013

ORDER

This civil rights lawsuit is brought by the surviving minor daughter of the decedent, Michael White, against the City of Vallejo (the "City") and its Chief of Police, Robert Nichelini (the "defendant").¹ The plaintiff, through her Guardian ad Litem,Tanaya Barber, alleges that the City's police officers killed the decedent while they were using a taser gun during his arrest. Both defendants move for judgment on the pleadings, asserting that the cases against them were discharged in the City's bankruptcy.

For the reasons that follow, the City's un-opposed motion for judgment on the pleadings will be granted. In addition, defendant Robert Nichelini's motion for judgment on the pleadings will be granted to the extent the lawsuit names him in his official capacity, but denied to the extent the lawsuit names him in his individual (or personal) capacity.

I. BACKGROUND

On May 23, 2008, the City of Vallejo filed for Chapter 9 bankruptcy protection. Defendants' Request for Judicial Notice ("RfJN") Exh. 1 (ECF No. 13-2, pp.6-84). On June 15, 2010, while the bankruptcy case was pending, the City's police officers allegedly killed the decedent, see Complaint ¶ 16, wrongfully and in violation of his and his daughter's civil rights. No later than December 15, 2010, plaintiff filed tort claims pursuant to Cal. Gov. Code §§ 910, et seq.. Complaint ¶ 13.² On August 4, 2011, the Bankruptcy Court confirmed the City's Plan (filed August 2, 2011) for the adjustment of its debts. RfJN Exh. 3 (ECF No. 13-2, pp.86-88). According to the Plan, the City was discharged from alldebts and all claims against it, with exceptions not relevant here, pursuant to "section 944 of the Bankruptcy Code" upon the "effective date" of November 1, 2011. RfJN Exh. 4 (ECF No. 13-2, pp.90-91 (Vallejo's "Notice of November 1, 2011 Effective Date"). Plaintiff filed this lawsuit on June 18, 2012.

II. STANDARDS

A motion for judgment on the pleadings may be brought "[a]fter the pleadings are closed but within such time as to not delay the trial." Fed. R. Civ. P. 12(c). The court analyzes 12(c) motions in substantially the same way as it analyzes Rule 12(b)(6) motions because, "under both rules, 'a court must determine whether the facts alleged in the complaint, taken as true, entitle the plaintiff to a legal remedy.'" Chavez v. U.S., 683 F.3d 1102, 1108 (9th Cir. 2012).

On a motion to dismiss under Rule 12(b)(6), a court must assess whether the complaint contain[s] sufficient factual matter, accepted as true, to "state a claim to relief that is plausible on its face." Mere conclusory statements in a complaint and "formulaic recitation[s] of the elements of a cause of action" are not sufficient. Thus, a court discounts conclusory statements, which are not entitled to the presumption of truth, before determining whether a claim is plausible. A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. Determining whether a complaint states a plausible claim for relief will ... be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.

Chavez, 683 F.3d at 1108-09 (citations and some internal quotationsomitted).³

III. ANALYSIS

A. The City.

The City and defendant Nichelini, in his official capacity, move for a judgment on the pleadings, arguing that any claim plaintiff might have against them was discharged by the City's Chapter 9 bankruptcy and the confirmation of its Plan. Plaintiff concedes that the bankruptcy code "renders any judgment Plaintiff would get against Defendant City for the events occurring on June 15, 2010, void and thereby bars Plaintiff from pursuing her claims against Defendant City." Plaintiff's Opposition to Motion for Judgment on the Pleadings (ECF No. 19) at p.5. Plaintiff's concession is well-taken, although some explanation is needed here.

1. Timing of the discharge.

Unlike a Chapter 7 liquidation bankruptcy, in a Chapter 9 municipal bankruptcy, the bankruptcy code discharges all of the City's debt existing as of the date of confirmation.⁴ 11 U.S.C. § 944(b)(1) ("the debtor is discharged from all debts as of thetime when ... the plan is confirmed").⁵ Plaintiff concedes that her claim arose on June 15, 2010. Accordingly the claims against the City, and against defendant in his official capacity - which arose after commencement of the bankruptcy, but before the confirmation date - are barred. O'Loghlin v. County of Orange, 229 F.3d 871 (9th Cir. 2000). O'Loghlin addressed the status of three ADA claims against a Chapter 9 municipal bankruptcy debtor: one arose before commencement of the bankruptcy case; one arose after commencement but before discharge (the date the plan was confirmed); and one arose post-discharge (after the confirmation date). The Ninth Circuit, interpreting Section 944(b)(1), held that the claims arising before the confirmation date were discharged in the bankruptcy. Id., at 877 (affirming "the district court's dismissal of O'Loghlin's complaint insofar as it is based on pre-discharge violations of the ADA by the County"). Only the claim that arose after the discharge date was permitted to go forward. Id.

2. Dischargeability of plaintiff's claims.

Another remarkable feature of a municipal bankruptcy is that discharges under Chapter 9 are not subject to the "exceptions" to discharge set forth at 11 U.S.C. § 523(a). These exceptions prohibit individual debtors from discharging debt arising from "willful and malicious injury." 11 U.S.C. § 523(a); Kawaauhau v. Geigher, 523 U.S. 57, 63 (1998) (to be non-dischargeable, thejudgment debt must be "for willful and malicious" injury). Although the statute itself does not expressly state that injuries (or as here, death), allegedly resulting from civil rights violations are non-dischargeable, many bankruptcy courts have so interpreted this exception. See, e.g., Gee v. Hammond (In re Gee), 173 B.R. 189, 193 (B.A.P. 9th Cir. 1994) (claim arising from sex discrimination was non-dischargeable under Section 523(a), as the underlying acts were "willful and malicious"); Avery v. Sotelo (In re Sotelo), 179 B.R. 214, 218 (Bkrtcy. S.D. Cal. 1995) (claim arising from sexual harassment injury is not dischargeable); (Magana v. Moore Development Corp. (In re Moore), 1 B.R. 52, 54 (Bankr. C.D. Cal. 1979) (in a racial discrimination case involving housing, the court holds that the "[d]ischarge of debts arising from willful violations" of the civil rights laws would be "inconsistent with the intent of Congress," as those laws are specifically intended to eliminate the "'badges and incidents of slavery'").

Neither party has identified anything in the language of the bankruptcy laws that prevents a municipality from avoiding liability, even for a willful and malicious violation of the civil rights of one its own citizens.⁶ To the contrary, this somewhatsurprising, indeed, alarming result appears to be supported by the language of the bankruptcy laws because: (1) the non-dischargeability of debts for "willful and malicious injury" applies only to debts of individuals; and (2) the "willful and malicious injury" non-dischargeability provisions do not apply at all in a Chapter 9 bankruptcy.⁷ 11 U.S.C. §§ 523(a) (applying exceptions to discharges to "individual" debtors under "section 727, 1141, 1228(a), 1228(b), or 1328(b)"); 901 (omitting Section 523 from the general bankruptcy sections that apply in a Chapter 9 case); accord Yamaha Motor Corp. U.S.A. v. Shadco, Inc., 762 F.2d 668, 670 (8th Cir. 1985) (the exemptions embodied in 11 U.S.C. § 523(a) apply only to individual donors, they "do not apply to corporate debtors"), cited with approval, Towers v. U.S. (In re Pacific-Atlantic Trading Co.), 64 F.3d 1292, 1302 (9th Cir. 1995) (in the context of tax claims, "§ 523 only applies to individual and not corporate debtors").

Thus, alarming as it is, as the bankruptcy statute appears to be written, a municipality may erase its own liability to persons whom it and its officers have willfully and maliciously deprivedof their civil rights - and even their lives - by filing for bankruptcy. This extraordinary result would appear to exalt the bankruptcy laws over the civil rights laws (even though the civil rights laws, like the bankruptcy laws, are anchored in the constitution). However, the court need not, and does not, resolve this matter, as neither side has briefed it nor identified any applicable statutory, case-law or legislative history citations relating to this matter. To the contrary, plaintiff has simply conceded that her claims against the City were discharged in the bankruptcy.

B. Chief of Police, Robert Nichelini.

1. Arguments.

Nichelini asserts that the claims against him in his individual or personal capacity should be dismissed because they are, in essence, claims against the City, and were therefore discharged with the City's bankruptcy. This assertion rests upon two distinct premises.

First, defendant asserts that under state law, the City is required to defend him "regardless of whether the case is brought under § 1983 and whether they are sued in their individual or official capacities," citing Cal. Gov't Code § 995 and Williams v. Horvath, 16 Cal. 3d 834, 843 (1976). Motion at 5-6. Second, defendant argues that state law "requires the City to pay any claim or judgment against its employees in favor of third-partyplaintiffs," citing Cal. Gov't Code § 825, et...