Opinion
CASE NO. 4:18-CV-02118
2019-06-18
Adriane BEAMON, Plaintiff, v. MCCALL-SB, INC. d/b/a Advantage BMW Midtown, Garrett Lee Burleson, Marcus A. Bishop, and Asset Hunters, LLC, Defendants.
Russell S. Thompson, IV, Thompson Consumer Law Group, PC, Mesa, AZ, for Plaintiff. Andrew Harald Sharenson, Johnson Deluca et al., Houston, TX, for Defendants McCall-SB, Inc., Garrett Lee Burleson.
Russell S. Thompson, IV, Thompson Consumer Law Group, PC, Mesa, AZ, for Plaintiff.
Andrew Harald Sharenson, Johnson Deluca et al., Houston, TX, for Defendants McCall-SB, Inc., Garrett Lee Burleson.
ORDER
VANESSA D. GILMORE, UNITED STATES DISTRICT JUDGE
Pending before the Court is Marcus A. Bishop, and Asset Hunters, LLC (collectively, "Defendants")’s 12(b)(1) Motion to Dismiss for Lack of Subject Matter Jurisdiction and in the alternative 12(b)(6) Motion to Dismiss for Failure to State a Claim. (Instrument No. 33).
I.
A.
This case involves the alleged wrongful repossession of Adriane Beamon ("Plaintiff")’s 2012 Mercedes CLS ("the Vehicle"). (Instrument No. 22 at 8-9). Plaintiff alleges she purchased the Vehicle from McCall-SB, Inc. d/b/a Advantage BMW Midtown ("McCall") on June 15, 2017. Id. at 7. As part of her financing agreement, Plaintiff had to make an initial down payment of $1,000. Id. at 8. Plaintiff paid this down payment via check. Id. However, Plaintiff's check bounced. Id. McCall then engaged Asset Hunters, LLC ("Asset") and Asset's repossession agent, Marcus A. Bishop ("Bishop"), to repossess the Vehicle. Id.
On July 3, 2017, Bishop located the Vehicle outside of a Houston-area apartment complex and began to repossess it. (Instrument No. 22 at 8). At the same time, Plaintiff was hosting her daughter's birthday party. Id. Plaintiff alleges that once she noticed Bishop, she ran out and immediately protested the repossession "loudly and unequivocally." Id. at 8-9. Bishop and Plaintiff then engaged in a "loud and rowdy confrontation" in front of Plaintiff's friends and family which "continued for nearly an hour." Id. at 9. Bishop eventually called Garett Lee Burleson ("Burleson"), an employee of McCall, and the Houston Police Department. Id. Officers Frolik and Nickerson (the "Officers") responded to the call. Id. Bishop and Burleson then allegedly "sought and obtained" the aid of the Officers in completing the repossession. Id. at 9. The Officers arrived on scene and informed Plaintiff that she could not keep the Vehicle. Id. After Plaintiff continued to protest, the Officers handcuffed her and placed her in their squad car. Id. Plaintiff alleges that Burleson and Bishop then directed the Officers to take the Vehicle's keys from Plaintiff and hand them to Bishop so he could complete the repossession. Id. at 10, 16.
B.
Officers Frolik and Gallien subsequently submitted police reports, which have a different version of events. (Instrument No. 36-1). According to the police reports, the Officers arrived at approximately 9 p.m. in response to a disturbance call. Id. at 4. The Officers immediately took the statements of Bishop and Plaintiff. Id. at 5. The police reports clarify that Bishop had nearly finished repossessing the Vehicle when Plaintiff initiated a confrontation. Id. After Plaintiff realized that Bishop was repossessing the Vehicle, she rushed over and jumped into the driver's seat of the Vehicle, which was now positioned on the tow truck's ramp. Id. Plaintiff then attempted to drive the Vehicle off Bishop's tow truck. Id. She struck Bishop in the leg with the Vehicle, before the tow hook halted the forward progress of the Vehicle and prevented Plaintiff from driving fully off the truck and into a group of nearby children. Id. The Officers concluded that Plaintiff's actions injured Bishop's leg, damaged his tow truck and the Vehicle, and almost injured nearby children at the birthday party. Id. at 5, 7, 8. The Officers described Plaintiff as "very angry and irate" and they "observed the [Plaintiff] to be irrational." Id. at 5.
The Officers’ initial attempts to diffuse the situation were unsuccessful. (Instrument No. 36-1 at 5). This prompted them to call their supervisor, Sergeant Gallien ("Gallien"), to the scene. Id. Gallien spoke to both Plaintiff and Bishop and called Burleson. Id. at 8. Bishop and Burleson informed Gallien they wished to pursue criminal charges against Plaintiff. Id. at 7-8. Gallien subsequently called the Harris County District Attorney's Office to determine whether charges should be brought against Plaintiff. Id. at 8. Gallien communicated to Plaintiff that she was going to be placed under arrest for criminal mischief and assault and instructed the Officers to place her into handcuffs and into the back of Gallien's squad car. Id. After Plaintiff was placed in the squad car, Gallien spoke to Bishop and Burleson who informed Gallien that if Plaintiff would instruct her daughter to hand over the keys to the Vehicle, they would not pursue criminal charges. Id. Plaintiff told her daughter to hand over the keys and Plaintiff's daughter did so. Id. Burleson and Bishop accordingly informed Gallien they no longer sought to pursue charges and Plaintiff was released from custody shortly after Bishop left with the Vehicle. Id.
II.
Plaintiff filed her Original Complaint on June 22, 2018, against Defendants Asset and McCall. (Instrument No. 1). Defendants Asset and McCall filed their Answer to Plaintiff's Original Complaint on July 13, 2018. (Instrument No. 6). Plaintiff then filed her First Amended Complaint on August 29, 2018, naming Burleson as a new co-defendant. (Instrument No. 8). Burleson filed his Answer to Plaintiff's First Amended Complaint on October 19, 2018. (Instrument No. 24). On December 7, 2018, Plaintiff filed her Second Amended Complaint. (Instruments No. 22). Plaintiff's Second Amended Complaint alleges state law claims for violations of the Texas Business & Commerce Code and Texas Finance Code, and a claim for intentional infliction of emotional distress. Id. Plaintiff's Second Amended Complaint also alleges a claim under 42 U.S.C. § 1983 against Bishop and Burleson. Id. On April 12, 2019, Defendants Asset and Bishop filed a Motion to Dismiss pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6) seeking dismissal for lack of subject matter jurisdiction or in the alternative failure to state a claim. (Instrument No. 33). Plaintiff filed her Response to Defendants’ Motion to Dismiss on May 15, 2019. (Instrument No. 36).
III.
"A case is properly dismissed for lack of subject matter jurisdiction when the court lacks the statutory or constitutional power to adjudicate the case." Home Builders Ass'n of Miss., Inc. v. City of Madison, Miss. , 143 F.3d 1006, 1010 (5th Cir. 1998) (internal quotation omitted). A district court may dismiss an action for lack of subject matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1) on any one of three separate bases: (1) the complaint alone, (2) the complaint supplemented by undisputed facts evidenced in the record, or (3) the complaint supplemented by undisputed facts plus the court's resolution of disputed facts. Ramming v. United States , 281 F.3d 158, 161 (5th Cir. 2001) (citing Barrera-Montenegro v. United States , 74 F.3d 657, 659 (5th Cir. 1996) ).
In examining a Rule 12(b)(1) motion, courts are empowered to consider matters of fact which are in dispute. See Williamson v. Tucker , 645 F.2d 404, 413 (5th Cir. 1981) (when determining jurisdiction, district court may hear conflicting written and oral evidence and decide for itself the factual issues). Any uncontroverted facts in the complaint must, however, be accepted as true. See Gaubert v. United States , 885 F.2d 1284, 1285 (5th Cir. 1989), rev'd on other grounds , 499 U.S. 315, 111 S.Ct. 1267, 113 L.Ed.2d 335 (1991). The court must also construe the complaint broadly and liberally, although argumentative inferences favorable to the pleader will not be drawn. Id. When the court's subject matter jurisdiction is challenged, the party asserting jurisdiction bears the burden of establishing it. Life Partners Inc. v. United States , 650 F.3d 1026, 1029 (5th Cir. 2011).
When a Rule 12(b)(1) motion is filed in conjunction with other Rule 12 motions, the court should usually consider the Rule 12(b)(1) jurisdictional issue before addressing any attack on the merits. Ramming , 281 F.3d at 161. This prevents a court without jurisdiction from prematurely dismissing a case with prejudice. Id. The court's dismissal of a plaintiff's case because of lack of subject matter jurisdiction is not a determination of the merits and does not prevent the plaintiff from pursuing a claim in a court that does have proper jurisdiction. Id. A motion to dismiss under Rule 12(b)(1) for lack of subject matter jurisdiction should be granted only if it appears that the plaintiff cannot prove any set of facts in support of her claim that would entitle her to relief. Id.
IV.
Defendants’ Motion to Dismiss argues for dismissal of Plaintiff's Second Amended Complaint pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). (Instrument No. 33). Because Defendants have filed their Rule 12(b)(1) Motion in conjunction with their Rule 12(b)(6) Motion, the Court will analyze the jurisdictional issue first.
The parties agree that the only arguable basis for this Court's subject matter jurisdiction is Plaintiff's § 1983 claim against Defendants Burleson and Bishop. A claim brought under 42 U.S.C. § 1983 holds a state actor accountable for the deprivation of a plaintiff's constitutionally protected life, liberty or property interest. Blackburn v. City of Marshall , 42 F.3d 925, 935 (5th Cir. 1995). In the repossession context, state action is present if police involvement amounts to "intervention or aid" of the private actors engaged in repossession. Menchaca v. Chrysler Credit Corp. , 613 F.2d 507, 511 (5th Cir. 1980). However, the police may maintain the peace, and even threaten a repossessee with arrest if they continue to breach the peace without providing intervention or aid that would constitute state action. Id. at 510, 513.
Defendants’ Motion presents both a "facial" and a "factual challenge" to the existence of a federal question. Defendants’ facial challenge argues that the factual allegations in the Second Amended Complaint do not show police intervention or aid that rises to the level of state action. Id. at 4-5. Defendants further contend that even if this Court finds that Plaintiff's Second Amended Complaint alleges state action, the evidence in the record contradicts Plaintiff's claim that the conduct of Defendants Bishop and Burleson constituted state action. Id. at 5-6. In her Response, Plaintiff contends that the police reports by Officers Frolik and Gallien support her § 1983 claim because they show that the Officers acted beyond their normal peacekeeping power. (Instrument No. 36 at 6-11).
A facial challenge to subject matter jurisdiction requires a court to examine the allegations put forward in the plaintiff's complaint and determine if she has sufficiently alleged a basis for subject matter jurisdiction. Menchaca , 613 F.2d at 511. In a facial challenge, the allegations in the plaintiff's complaint are taken as true. Id. A factual challenge, in contrast, "challenges the existence of subject matter jurisdiction in fact, irrespective of the pleadings, and matters outside of the pleadings, such as testimony and affidavits are considered." Id. Even if a plaintiff has adequately alleged a federal question in her complaint and it survives a facial challenge, a court must still dismiss the plaintiff's claims if the defendant raises a factual challenge and the court determines that there is in fact no federal question presented. See Id. Because Defendants have raised both a facial and factual challenge to Plaintiff's § 1983 claim, the Court will consider each one in turn.
A.
Plaintiff contends this Court has subject matter jurisdiction because her claim against Defendants Bishop and Burleson arises under 42 U.S.C. § 1983. (Instrument No. 22 at 1). Plaintiffs bringing § 1983 claims generally raise those claims against state actors. Blackburn , 42 F.3d at 935. However, Plaintiff has named neither the City of Houston nor the individual Officers who responded to the incident as defendants. Instead, Plaintiff alleges that the actions of the Officers while at the scene made the repossession by Bishop and Burleson the product of state action. (Instrument No. 22 at 17). Section 1983 ’s state action requirement, however, excludes from its reach wholly, private action no matter how discriminatory or wrongful. Blum v. Yaretsky , 457 U.S. 991, 1002, 102 S.Ct. 2777, 73 L.Ed.2d 534 (1982). Private action may be deemed state action, for purposes of § 1983, only where the challenged conduct "may be fairly attributable to the State." Lugar v. Edmondson Oil Co. , 457 U.S. 922, 937, 102 S.Ct. 2744, 73 L.Ed.2d 482 (1982).
For a repossession to constitute state action, a plaintiff must allege police intervention or aid that goes beyond merely keeping the peace. Menchaca , 613 F.2d at 511-12. In Menchaca v. Chrysler Group , police were called to the scene of a repossession in response to a disturbance. Id. at 510. Upon arriving at the scene, the Officers told Menchaca that the repossession was a civil matter and they were there only to quiet the disturbance. Id. However, the Officers did inform Menchaca that he would be arrested if he continued to "use loud and abusive language and create a breach of the peace." Id. After things deescalated, the Officers left and the men sent to repossess the vehicle completed their work. Id. After the incident, Menchaca brought an action under § 1983 naming the Officers as defendants. Id. The trial court dismissed the case for lack of subject matter jurisdiction finding no state action, and the Fifth Circuit affirmed. Id. On review, the Fifth Circuit noted that had the actions of the Officers amounted to intervention or aid, state action could have been implicated. Id. However, even with the Officers being named as defendants, the Court noted that "absent some form of concerted conduct on the part of the police officers [with the reposessor], there was no jurisdiction to support Any [sic] other claims against the remaining defendants." Id. at 512. To survive Defendants’ facial challenge, Plaintiff must show that the Officers provided Bishop or Burleson with intervention or aid goes beyond the peacekeeping actions of the police officers in Menchaca.
Taking Plaintiff's allegations as true, her allegations survive Defendants’ facial challenge. Plaintiff alleges that Bishop or Burleson called the police to report her protest of the repossession as an auto theft and that the Officers arrived on scene pursuant to that call. (Instrument No. 22 at 9). Plaintiff next alleges that Bishop or Burleson "sought and obtained the Officers’ aid in repossession." Id. at 9. The Officers then allegedly advised Plaintiff that she would not be able to keep the Vehicle, and after growing tired of her protesting, proceeded to put her in handcuffs and place her into the rear of their squad car. Id. The Officers, at the direction of Bishop or Burleson, then took the keys to the Vehicle from Plaintiff and handed them over to Bishop. Id. Plaintiff's allegations of the Officers’ actions allege intervention or aid that goes beyond the actions of the Officers in Menchaca. See Menchaca , 613 F.2d at 510. In Menchaca , the Officers reportedly never instructed the plaintiff about his ability to keep his car. Id. In addition, they made clear to the plaintiff that their role was only to keep the peace and did not involve themselves in the repossession or place him into custody. Id. They also did not assist the repossessors in obtaining the keys to Menchaca's vehicle. Id. Here, however, the alleged conduct of the Officers constitutes more substantial intervention or aid than that of the Officers in Menchaca. Plaintiff's allegations describe intervention or aid that could implicate state action during the repossession.
Accordingly, this Court finds that Plaintiff has met her burden as to Defendants’ facial 12(b)(1) challenge. The Court will next examine Defendants’ factual 12(b)(1) challenge.
B.
In a factual challenge, a court does not simply accept a plaintiff's allegations as true and is empowered to look outside the four comers of the complaint. Menchaca , 613 F.2d at 511. In addition, during a factual challenge, a court is empowered to resolve disputed facts. Ramming , 281 F.3d at 161. Defendants’ factual challenge relies on an Affidavit from Bishop which states that Plaintiff voluntarily surrendered the keys to the Vehicle to Bishop. (Instrument No. 33-1). Defendants argue that this factual difference along with the narrative of events presented in the Bishop Affidavit, which states that the Officers were only responding to a breach of the peace created by Plaintiff, shows that no state action was present. Id. Meanwhile, Plaintiff argues that the reports prepared by Officers Frolik and Gallien, submitted in her Response to Defendants’ Motion, show that the Officers’ involvement rendered Defendants’ conduct state action. (Instruments No. 36 at 8-11; No. 36-1). Specifically, Plaintiff alleges that the Officers conducted an illegal "curbside" courtroom by contacting the District Attorney to press charges and that their detainment of Plaintiff amounted to intervention or aid. (Instmment No. 36 at 9).
In a factual challenge, Plaintiff bears the burden of proof and must show that the Court has jurisdiction in fact. Menchaca , 613 F.2d at 511. In support of her allegations, Plaintiff has submitted five exhibits: (1) a copy of the Vehicle purchase contract; (2) a repossession order for the Vehicle, which notably does not show state endorsement of the repossession; (3) a cease and desist order stating that McCall was not following proper procedure in repossessing the Vehicle; (4) an abbreviated police report; and (5) the full police reports for the incident prepared by Officers Frolik and Gallien. (Instruments No. 22-1; No. 22-2; No. 22-3; No. 22-4; No. 36-1). Of Plaintiff's exhibits, only three relate to the events of that day. Moreover, of those three exhibits, only the two full police reports provide details of the event. Plaintiff has directed the Court to those exhibits to prove that the Court has subject matter jurisdiction, and the Court accordingly relies on Plaintiff's submitted evidence. (Instrument No. 36-1).
The police reports by Officers Frolik and Gallien do not collaborate the allegations put forward in Plaintiff's Second Amended Complaint. Rather, they directly contradict Plaintiff's allegations. To begin, neither of the reports states that the police arrived at the scene at the request of Bishop or Burleson for the purpose of aiding in the repossession. (Instrument No. 36-1 at 4-6; 7-9). Rather, the reports state the Officers arrived in response to a disturbance, as did the Officers in Menchaca . Id. at 4, 7; Menchaca , 613 F.2d at 511. In addition, nowhere in Frolik's or Gallien's reports does it state that Bishop or Burleson solicited the Officers’ aid or asked the Officers for assistance in the repossession. Id. at 7-9, 4-6.
Plaintiff being handcuffed and placed in the squad car was only tangentially related to the repossession. (Instrument No. 36-1 at 5, 8-9). Bishop sought to press charges for damages and injuries sustained after Plaintiff attempted to drive the Vehicle off his tow truck. Id. at 5, 8-9. Burleson also sought to press charges for auto theft or theft by check, as Plaintiff's check had bounced. Id. Plaintiff was detained and placed into Gallien's squad car, not because the Officers were trying to aid in the repossession, but because of the charges Bishop and Burleson wanted to pursue. Id. at 8-9. The Officers’ police reports describe Plaintiff as being "angry and irate" and "observed [Plaintiff] to be irrational," although her family and friends told her to give up the Vehicle. Id. at 5. After the Officers informed Plaintiff that if she handed over the keys to the Vehicle, Bishop would not press charges, Plaintiff instructed her daughter to give the keys to the Vehicle to Bishop, and the Officers left. Id. at 6, 9.
It is undisputed that Plaintiff was disturbing the peace. Plaintiff's Second Amended Complaint admits that Plaintiff was "loudly and unequivocally" resisting the repossession, and the submitted police reports show that Plaintiff injured Bishop, damaged the Vehicle by trying to drive it off the tow truck ramp, and nearly injured bystanders with the Vehicle. Although the Officers detained Plaintiff in the squad car and considered bringing criminal charges against her, the Officers were acting well within their role as law enforcement officers because Plaintiff caused a disturbance of the peace that was related to, but distinct from, the repossession of the Vehicle. See Menchaca , 613 F.2d at 511-12 (court concluded that officers informing plaintiff that if he "continued using loud and abusive language" he would be arrested was within the officers’ peacekeeping authority). Plaintiff has presented no evidence to indicate that the Officers acted outside the scope of their peacekeeping authority. The undisputed evidence shows that Defendants’ repossession of the Vehicle is not fairly attributable to the state. The mere fact that the Officers were present and responded to Plaintiff's disturbance of the peace does not convert Defendants’ repossession into a state action. Flagg Bros., Inc. v. Brooks , 436 U.S. 149, 164, 98 S.Ct. 1729, 56 L.Ed.2d 185 (1978) ("Our cases state that a State is responsible for the act of a private party when the State, by its law, has compelled the act. This Court, however, has never held that a State's mere acquiescence in a private action converts that action into that of the State." (internal quotation omitted)). Plaintiff's evidence in response to Defendants’ factual challenge shows that there is no federal question present in her case.
If Plaintiff can prove that Defendants’ repossession of the Vehicle was wrongful, she may pursue an action for damages against Defendants. However, Plaintiff's claims against Defendants relate to state law claims against non-diverse private parties and she therefore must bring her action in state court. Accordingly, the Court GRANTS Defendants’ 12(b)(1) Motion to Dismiss. (Instrument No. 33). As Plaintiff's claims have been dismissed for lack of subject matter jurisdiction, the Court need not consider Defendants’ 12(b)(6) Motion to Dismiss.
V.
Based on the foregoing, IT IS HEREBY ORDERED THAT Defendants’ 12(b)(1) Motion to Dismiss for Lack of Subject Matter Jurisdiction is GRANTED. (Instrument No. 33). Plaintiff's Second Amended Complaint is DISMISSED.