Opinion
Case No. 3:21-cv-00268-MMD-CSD
2022-03-29
Roger PALMER, et al., Plaintiffs, v. Stephen SISOLAK, et al., Defendants.
Adam Kraut, Pro Hac Vice, William Aaron Sack, Pro Hac Vice, Firearms Policy Coalition, Sacramento, CA, David C. O'Mara, The O'Mara Law Firm, P.C., Reno, NV, Raymond DiGuiseppe, Pro Hac Vice, The DiGuiseppe Law Firm, P.C., Southport, NC, for Plaintiffs. Kiel Brunetti Ireland, Steven Shevorski, Nevada Office of the Attorney General, Las Vegas, NV, Jeffrey M. Conner, Nevada Attorney General, Carson City, NV, for Defendants Stephen Sisolak, A.G. Aaron Ford, George Togliatti, Mindy McKay.
Adam Kraut, Pro Hac Vice, William Aaron Sack, Pro Hac Vice, Firearms Policy Coalition, Sacramento, CA, David C. O'Mara, The O'Mara Law Firm, P.C., Reno, NV, Raymond DiGuiseppe, Pro Hac Vice, The DiGuiseppe Law Firm, P.C., Southport, NC, for Plaintiffs.
Kiel Brunetti Ireland, Steven Shevorski, Nevada Office of the Attorney General, Las Vegas, NV, Jeffrey M. Conner, Nevada Attorney General, Carson City, NV, for Defendants Stephen Sisolak, A.G. Aaron Ford, George Togliatti, Mindy McKay.
ORDER
MIRANDA M. DU, CHIEF UNITED STATES DISTRICT JUDGE
I. SUMMARY
On June 10, 2021, Plaintiffs initiated this action challenging sections of Nevada Assembly Bill 286 ("A.B. 286"), which prohibits certain actions relating to firearms commonly referred to as "ghost guns," as violating the Second Amendment and the Fifth Amendment's Takings Clause. (ECF No. 1 ("Complaint").) Shortly after initiating this action, Plaintiffs filed a motion for preliminary injunction to enjoin Defendants from enforcing A.B. 286. (ECF No. 6.) The Court held a hearing on that motion ("the Hearing") and ultimately declined to enjoin Defendants because Plaintiffs had failed to demonstrate a likelihood of success on the merits of their claims. (ECF Nos. 48, 51 ("Order").)
Roger Palmer, Chad Moxley, and the Firearms Policy Coalition, Inc. ("FPC") (collectively, "Plaintiffs").
Remaining Defendants are Nevada Governor Steven Sisolak; Attorney General Aaron Ford; Director of Public Safety George Togliatti; Division Administrator for Department of Public Safety's Records, Communications and Compliance Division Mindy McKay (collectively, "Defendants").
Defendants now move to dismiss this action under Rule 12(b)(6) for failure to state a claim. (ECF No. 34 ("Motion") .) Because the Court agrees with Defendants for the reasons articulated in the Court's Order, and as further explained below, the Court grants Defendants’ Motion.
Plaintiffs oppose dismissal and Defendants filed a reply. (ECF Nos. 53, 57.)
II. BACKGROUND
The following facts are adapted from the Complaint. (ECF No. 1.) Plaintiffs Roger Palmer and Chad Moxley, both citizens of Nevada, own and possess multiple unserialized firearms and previously self-manufactured unserialized component parts. (Id. at 5, 20-21, 24.) Moxley and Palmer are both members of the Firearms Policy Coalition, Inc. ("FPC"). (Id. at 20, 23.) FPC's stated purpose is to defend and promote Second Amendment rights to keep and bear arms. (Id. at 26.) Palmer owns and possesses multiple uncompleted non-firearm objects and firearm building kits. (Id. at 21.) Moxley sells firearms and component firearm parts at local gun shows and seeks to continue selling unserialized firearms, their component parts, and other non-firearm objects. (Id. at 23-24.) Moxley made arrangements prior to the enactment of A.B. 286 to attend six or more gun shows before the end of 2021. (Id. at 23.)
Plaintiffs use both "constituent" and "component" parts interchangeably in the Complaint. For consistency purposes, the Court will use component parts throughout this order.
On June 7, 2021, Nevada's Governor Stephen Sisolak signed A.B. 286 into law. (Id. at 2.) At a May 11, 2021, pre-enactment hearing, Assemblywoman Sandra Jauregui—a sponsor of A.B. 286—made public statements about the law's purpose. (Id. at 17, 20, 33, 35.) With its enactment, A.B. 286 amended Chapter 202 of the Nevada Revised Statutes to prohibit "a person from engaging in certain acts relating to firearms which are not imprinted with a serial number under certain circumstances[.]" A.B. 286, 2021 Leg., 81st Sess. (Nev. 2021).
This litigation centers on certain sections A.B. 286 added to Chapter 202, which are as follows:
Section 3 states in part that a person "shall not possess, purchase, transport or receive an unfinished frame or receiver[.]" Id. at § 3(1).
Section 3.5 states in part that a person "shall not sell, offer to sell or transfer an unfinished frame or receiver[.]" Id. at § 3.5(1).
Section 4 states in part that a person "shall not manufacture or cause to be manufactured or assemble or cause to be assembled a firearm that is not imprinted with a serial number" unless the firearm is: (a) rendered permanently inoperable, (b) an antique firearm, or (c) determined to be a collector's item. Id. at §§ 4(1); 4(1)(a)-(c).
Section 5 states in part that a person "shall not possess, sell, offer to sell, transfer, purchase, transport or receive a firearm that is not imprinted with a serial number" unless the person is a (a) law enforcement agency, (b) firearms importer or manufacturer; or the firearm is: (a) rendered permanently inoperable, (b) manufactured before 1969, (c) an antique firearm, or (d) determined to be a collector's item. Id. at §§ 5(1); 5(1)(a)-(b).
Section 5.5 further provides: "Nothing in the provisions of sections 3 to 5, inclusive, of this act shall be deemed to prohibit the sale of an unfinished frame or receiver or firearm that is not imprinted with a serial number to a firearms importer or manufacturer or a license dealer before January 1, 2022." Id. at § 5.5.
A person in violation of any part of §§ 3-5 is guilty of a gross misdemeanor for a first offense and a category D felony for a second or any subsequent offense. Id. at §§ 3-5. Sections 3 and 5 become effective on January 1, 2022. Id. § 10(2).
III. LEGAL STANDARD
A court may dismiss a plaintiff's complaint for "failure to state a claim upon which relief can be granted." Fed. R. Civ. P. 12(b)(6). A properly pleaded complaint must provide "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2) ; Bell Atlantic Corp. v. Twombly , 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007). While Rule 8 does not require detailed factual allegations, it demands more than "labels and conclusions" or a "formulaic recitation of the elements of a cause of action." Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (citing Twombly , 550 U.S. at 555, 127 S.Ct. 1955 ). "Factual allegations must be enough to rise above the speculative level." Twombly , 550 U.S. at 555, 127 S.Ct. 1955. Thus, to survive a motion to dismiss, a complaint must contain sufficient factual matter to "state a claim to relief that is plausible on its face." Iqbal , 556 U.S. at 678, 129 S.Ct. 1937 (quoting Twombly , 550 U.S. at 570, 127 S.Ct. 1955 ).
IV. DISCUSSION
Defendants argue that dismissal is warranted because A.B. 286 does not violate the Second Amendment, nor does the Fifth Amendment's Takings Clause restrict the government's power to regulate and prohibit "dangerous private property." (ECF No. 34.) The Court will first address the Second Amendment, followed by the Takings Clause of the Fifth Amendment. Because the Court finds that Plaintiffs have failed to state a claim upon which relief can be granted, the Court will grant Defendants’ Motion.
A. Second Amendment
The Second Amendment expressly states: "A well regulated Militia, being necessary to the security of a free State, the right of the people to keep and bear Arms, shall not be infringed." U.S. Const. amend. II. In 2008, the Supreme Court held in District of Columbia v. Heller that the Second Amendment protects the "individual right to keep and bear arms." 554 U.S. 570, 622, 128 S.Ct. 2783, 171 L.Ed.2d 637 (2008). The "central component" of that right to bear arms is for self-defense, particularly defense of the home. Id. at 599, 628-29, 128 S.Ct. 2783. However, the Court also cautioned that, "[l]ike most rights, the right secured by the Second Amendment is not unlimited" and historically speaking "the right was not a right to keep and carry any weapon whatsoever in any manner whatsoever and for whatever purpose." Id. at 626, 128 S.Ct. 2783. The Court later held that the Second Amendment is also fully applicable to states and municipalities through the Fourteenth Amendment. See McDonald v. City of Chi. , 561 U.S. 742, 790-91, 130 S.Ct. 3020, 177 L.Ed.2d 894 (2010).
In Heller , the Supreme Court indicated that determining the scope of the Second Amendment's protection requires a historical and textual analysis of the Amendment, see id. at 576-605, 128 S.Ct. 2783, but the Court declined to undertake an exhaustive historical analysis of the full scope of the Amendment, see id. 626-27, 128 S.Ct. 2783.
The Ninth Circuit has adopted a two-step framework to evaluate Second Amendment claims after Heller and McDonald . See Young v. Hawaii , 992 F.3d 765, 783-84 (2021) (en banc). The two-step inquiry requires courts to ask (1) whether the challenged law burdens conduct protected by the Second Amendment and (2) if the law burdens protected Second Amendment conduct, then the second step requires determining the appropriate level of scrutiny and applying it to the challenged law. See id. , 992 F.3d at 783-84.
See also Silvester v. Harris , 843 F.3d 816, 820-21 (9th Cir. 2016) ; Peruta v. Cnty. of San Diego , 824 F.3d. 919, 939 (9th Cir. 2016) ; Jackson v. City & Cnty. of S.F. , 746 F.3d 953, 960-61 (9th Cir. 2014) ; United States v. Chovan , 735 F.3d 1127, 1136 (9th Cir. 2013).
"The level of scrutiny depends upon (1) how close the law comes to the core of the Second Amendment right, and (2) the severity of the law's burden on the right." Jackson v. City & Cnty. of S.F. , 746 F.3d 953, 963 (9th Cir. 2014) (internal quotes and citation omitted). Courts must look at the "historical understanding of the scope of the right." Young , 992 F.3d at 783 (quoting Heller , 554 U.S. at 625, 128 S.Ct. 2783 ). A law that imposes a severe restriction on a core right, which destroys the protection of the Second Amendment, is "unconstitutional under any level of scrutiny." Jackson , 746 F.3d at 961 (citing Heller , 554 U.S. at 629, 128 S.Ct. 2783 ). "[I]f a challenged law does not implicate a core Second Amendment right, or does not place a substantial burden on the Second Amendment right, [courts] may apply intermediate scrutiny." Id. "[A]ll forms of the [intermediate scrutiny] standard require (1) the government's stated objective to be significant, substantial, or important; and (2) a reasonable fit between the challenged regulation and the asserted objective." Id. at 965 (quoting Chovan , 735 F.3d at 1129 ).
1. Burden on Protected Conduct
Defendants argue that Plaintiffs cannot meet the required two-step inquiry for their claim. (ECF No. 34 at 7-10.) More specifically, Defendants argue that Plaintiffs cannot show A.B. 286 burdens constitutionally protected Second Amendment conduct, and thus the inquiry ends there. (Id. at 7-8.) Plaintiffs counter that they have asserted a "strong, ultimately meritorious" Second Amendment claim as A.B. 286 is a law that targets firearms in common use for lawful purposes, and the law targets the right to self-manufacture firearms. (ECF No. 53 at 5-9.) The Court agrees with Defendants.
The focus of the analysis as stated in Heller requires the Court to determine whether A.B. 286 burdens the "central component" of the right to bear arms for self-defense in the home. See 554 U.S. at 599, 628-29, 128 S.Ct. 2783. As it stands, A.B. 286 regulates firearms not imprinted with serial numbers—the law therefore "does not interfere with the right to ‘defense of hearth and home’ " because Plaintiffs’ ability to use any and all serialized firearms to defend their homes remains unchanged. (ECF No. 34 at 8 (quoting Heller , 554 U.S. at 635, 128 S.Ct. 2783 ).) Cf. Jackson , 746 F.3d at 968 ("A ban on the sale of certain types of ammunition does not prevent the use of handguns or other weapons in self-defense. The regulation ... limits only the manner in which a person may exercise Second Amendment rights by making it more difficult to purchase certain types of ammunition."). Notably, Plaintiffs admitted at the Hearing that a person could still acquire a serialized firearm from a licensed seller for defense of self and home under A.B. 286. (ECF No. 48.) Thus, A.B. 286 does not target firearms in common use for lawful purposes.
Moreover, A.B. 286 does not target the right to self-manufacture firearms. Rather, it prohibits self-manufacturing of unserialized firearms. A.B. 286 § 4(1) ("a person shall not manufacture ... a firearm that is not imprinted with a serial number"). Under the statutory scheme, Plaintiffs are not entirely stripped of the opportunity to self-manufacture and assemble firearms, they are only prohibited from doing so with unserialized firearms. See § 4(1). A.B. 286 additionally provides that individuals can self-manufacture and assemble unserialized firearms so long as the firearms fall within an exception. See § 4(1)(a)-(c). Accordingly, the Court finds A.B. 286 does not severely burden Second Amendment protected conduct, but merely regulates it. Intermediate scrutiny rather than strict scrutiny is therefore appropriate for the Court's analysis of A.B. 286. See Young , 992 F.3d at 784 (stating that intermediate scrutiny applies in cases where Second Amendment rights are "affected in some lesser way"); see also Teter v. Connors , 460 F. Supp. 3d 989, 1003 (D. Haw. 2020) (citation omitted, emphasis in original) (stating that "[m]ost post- Heller decisions have landed on some form of intermediate scrutiny" and the court is unaware of any Ninth Circuit cases applying strict scrutiny in the Second Amendment context).
Defendants also argue that A.B. 286 would still pass constitutional muster under strict scrutiny review. (ECF No. 34 at 9-10.) Plaintiffs on the other hand, citing to Jackson , 746 F.3d at 961, together with Ams. for Prosperity Found. v. Bonta , ––– U.S. ––––, 141 S. Ct. 2373, 210 L.Ed.2d 716 (2021), argue the Court should apply "exacting scrutiny" as the appropriate standard. (ECF No. 53 at 11, 13.) The Court declines to address these arguments as it has determined that intermediate scrutiny is the appropriate level of scrutiny.
2. Stated Objective and Reasonable Fit
Defendants argue that "the ability of law enforcement to conduct serial number tracing" is "a substantial or important interest" of the State of Nevada. (ECF No. 34 at 9-10 (quoting Pena v. Lindley , 898 F.3d 969, 982 (9th Cir. 2018) ).) Additionally, A.B. 286 is a "reasonable fit" to that important interest as it does not prevent individuals who are legally permitted to obtain a firearm from purchasing a serialized firearm or receiver for home defense. (Id. ) Plaintiffs appear to counter that the State's important interest must be "narrowly tailored" to achieve its interest. (ECF No. 53 at 11-12.) Moreover, Plaintiffs assert the State's claimed interest is "disingenuous," "pretextual," and an "attempt to justify the law as being something other than what it is." (Id. at 13.) The Court disagrees with both of Plaintiffs’ arguments and finds they have failed to plausibly plead A.B. 286 is not a reasonable fit for an important government interest.
As a preliminary matter, the Court rejects Plaintiffs’ apparent application of the strict scrutiny, rather than intermediate scrutiny standard. At the Hearing, Plaintiffs argued A.B. 286 must be "narrowly tailored" to the government's objective. (ECF No. 48.) But Plaintiffs appeared then—as they do now—to apply strict scrutiny, which the Court has previously determined is improper. (See ECF No. 51 at 8, n.8.) The Court reiterates that while courts have used various terminology to describe the intermediate-scrutiny standard, as mentioned above, the government must show "a reasonable fit between the challenged regulation and asserted objective" under intermediate scrutiny. Jackson , 746 F.3d at 965 (quotes omitted, emphasis added); see Teter , 460 F. Supp. 3d at 1003 (stating that most decisions post- Heller "have landed on some form of intermediate scrutiny."). Intermediate scrutiny is not a strict test, and the Ninth Circuit has expressed that the standard "does not require the least restrictive means of furthering a given end." Silvester , 843 F.3d at 827 (quoting Jackson , 746 F.3d at 966 ); see also Altman v. Cnty. of Santa Clara , 464 F. Supp. 3d 1106, 1129 (N.D. Cal. 2020) ("The Ninth Circuit ... does not require narrow tailoring for firearm regulations subject to intermediate scrutiny."). As such, and despite Plaintiffs repeated contention, A.B. 286 need not be narrowly tailored to the government's important objective.
The Court now turns to whether Plaintiffs plausibly assert that A.B. 286 fails to pass intermediate scrutiny. In analyzing the first prong of intermediate scrutiny review, the Court must determine whether the government's stated objective is significant, substantial, or important. See Jackson , 746 F.3d at 965. Defendants cite to a congressional report that concludes unserialized firearms are a present and increasing threat to public safety because they present a "homeland security challenge" and they "hamstring[ ] law enforcement's ability to investigate crimes committed with untraceable weapons." (ECF No. 34 at 5) (quoting H.R. Rep. No. 116-88, pt. 1, at 2 (2019).) Defendants further note that law enforcement agencies recovered nearly 24,000 privately made firearms, without serial numbers on the frame or receiver, from crime scenes between 2016 and 2020. (Id. ) (citing Definition of "Frame or Receiver" and Identification of Firearms, 86 Fed. Reg. 27720,27722 (May 21, 2021) (to be codified at 27 C.F.R. pts. 447, 478, 479)). The Court, in considering the government's stated objectives, will not impose "an unnecessarily rigid burden of proof ... so long as whatever evidence the [government] relies upon is reasonably believed to be relevant to the problem that the [government] addresses." Jackson , 746 F.3d at 965 (quoting Renton v. Playtime Theatres , 475 U.S. 41, 50-52, 106 S.Ct. 925, 89 L.Ed.2d 29 (1986) ).
Plaintiffs seek to raise doubt regarding the justification behind A.B. 286 (see ECF No. 53 at 17-20), but the Court declines to address these issues as the Court makes clear here that it does not need to impose an unnecessary burden of proof so long as the government's stated objective is reasonably believed to be relevant to the problem. See Jackson , 746 F.3d at 965.
Here, A.B. 286 prohibits "a person from engaging in certain acts relating to firearms which are not imprinted with a serial number." A.B. 286, 2021 Leg., 81st Sess. (Nev. 2021). When the Nevada Legislature considered A.B. 286, Assemblywoman Sandra Jauregui—a sponsor of the Bill—echoed Congress’ concerns when she stated that unserialized firearms are a threat to public safety because they circumvent background checks, and they are untraceable if used in a crime. (ECF No. 34 at 6) (citing Prohibits Certain Acts Relating to Firearms: Hearing on A.B. 286 Before Senate Comm. on Judiciary , 81st Session (May 11, 2021) (statement of Sandra Jauregui, Assemblywoman)). Moreover, Assemblywoman Jauregui "explained that ghost guns are an especially acute threat to Nevada because one of the largest unfinished receiver kit companies in the nation, Polymer80, Inc. is based [in Nevada]." (Id. )
Plaintiffs do not contest the government's interest is important or substantial. Nor can they. It is "self-evident" that preventing gun violence and maintaining public safety is a long-acknowledge and undeniably important government interest. Chovan , 735 F.3d at 1139 ; see also Jackson , 746 F.3d at 965 ; United States v. Salerno , 481 U.S. 739, 748, 107 S.Ct. 2095, 95 L.Ed.2d 697 (1987) ("[T]he Government's regulatory interest in community safety can, in appropriate circumstances, outweigh an individual's liberty interest."). Additionally, the government's objective in preserving law enforcement's ability to investigate crimes committed with untraceable weapons is also a substantial and important government interest. See Pena v. Lindley , 898 F.3d 969, 981-82 (9th Cir. 2018) (holding that a California law requiring new models of semiautomatic pistols to be imprinted with characters, including a serial number, passed constitutional muster under intermediate scrutiny because "preserving the ability of law enforcement to conduct serial number tracing—effectuated by limiting the availability of untraceable firearms—constitutes a substantial or important interest."). As such, the government's objectives in enacting A.B. 286 are undeniably substantial and important, thus satisfying the first prong of intermediate scrutiny.
The second prong of intermediate scrutiny requires a determination that A.B. 286's regulations be a "reasonable fit" with the government's asserted objectives. Jackson , 746 F.3d at 965. Defendants articulate that A.B. 286 "addresses the threat posed by unserialized firearms and firearm components." (ECF No. 34 at 6.) A plain text reading of A.B. 286 affirms that it does so by prohibiting the possession and sale of firearms and component parts that lack serial numbers. §§ 3(1), 3.5(1). It also prohibits a person from manufacturing or assembling an unserialized firearm unless it falls within a categorical exception, see A.B. 286 § 4(1)(a)-(c). Moreover, A.B. 286 prohibits the possession of unserialized firearms unless an exception applies, see § 5(1)(a)-(b). A.B. 286 focuses only on unserialized firearms that (1) are not within a categorical exception, (2) bypass background checks by virtue of self-manufacturing and assembly, and (3) are untraceable without a serial number. Plaintiffs do not directly challenge that A.B. 286 is not a "reasonable fit" for the state's substantial or important interest in promoting public safety or conducting serial number tracing. Instead, Plaintiffs contend the government's objectives are "disingenuous." (ECF No. 53 at 12-17.) According to Plaintiffs, if the purpose of A.B. 286 is to require firearms be serialized, then the State would have established a mechanism permitting individuals to pass a background check and obtain a state-issued serial number like California and Connecticut. (Id. ) But Plaintiffs misstate the purpose of A.B. 286. While the law requires firearms be serialized, see A.B. 286 §§ 4, 5, the purpose itself is not to serialize firearms. Rather, as Defendants clearly state, the purpose is to maintain public safety and to preserve the ability of law enforcement to investigate crimes committed with untraceable weapons. Plaintiffs’ repeated assertion that Defendants are required to create a mechanism to obtain serialization appears to be an effort to mask another effort to argue A.B. 286 must be "narrowly tailored" to the government's stated objective. However, as the Court has made clear, intermediate scrutiny rather than strict scrutiny is appropriate in analyzing A.B. 286. Moreover, merely because California and Connecticut have chosen a different avenue to regulate unserialized firearms does not require Nevada to follow identically in tow. Because Defendants are not required to narrowly tailor their regulation, Plaintiffs’ argument is inapposite. Plaintiffs have thus failed to plead that A.B. 286 is not a reasonable fit for the state's important interest of ensuring public safety. As such, Plaintiffs have failed to state a Second Amendment claim upon which relief can be granted.
To support this argument, Plaintiffs cite and discuss a state court action before the Third District Court of Nevada pertaining to A.B. 286. (ECF No. 53 at 13-17.) See Polymer80, Inc. v. Sisolak , Case No. 21-CV-00690 (Nev. 3rd. Jud. Dist. Ct. July 16, 2021). The Court notes that the state court action has no binding authority on this Court.
B. Fifth Amendment's Takings Clause
Plaintiffs allege that the enactment of A.B. 286 resulted in a "taking" of their unserialized firearms and component parts. (ECF No. 1 at 33-36.) The Takings Clause of the Fifth Amendment provides: "[N]or shall private property be taken for public use, without just compensation." U.S. Const. amend. V. The Clause is made applicable to states through the Fourteenth Amendment. See Chi., B. & Q.R. Co. v. Chicago , 166 U.S. 226, 239, 17 S.Ct. 581, 41 L.Ed. 979 (1897). A physical taking of property occurs "[w]hen the government physically takes possession of an interest in the property for some public purpose." Tahoe-Sierra Pres. Council v. Tahoe Reg'l Planning Agency , 535 U.S. 302, 322, 122 S.Ct. 1465, 152 L.Ed.2d 517 (2002). When a government regulation of private property becomes so onerous and thus "goes too far[,] it will be recognized as a taking." See Pa. Coal Co. v. Mahon , 260 U.S. 393, 415-16, 43 S.Ct. 158, 67 L.Ed. 322 (1922).
Although it is somewhat unclear from the Complaint and Plaintiffs’ opposition to the Motion, Plaintiffs appear to argue that A.B. 286 resulted in a regulatory taking and a nuisance taking. Defendants argue that Plaintiffs have failed to demonstrate a taking has occurred. The Court will first address the parties’ arguments as they related to regulatory taking, then discuss the government's police power, and finally conclude by addressing Defendants’ nuisance taking argument.
In its previous Order, the Court notably addressed the issue of physical taking because Plaintiffs’ motion for a preliminary injunction argued that the government had a duty to provide "just compensation" since A.B. 286 required the property at issue be sold or transferred. (ECF No. 51 at 14-15.) In their response to the motion to dismiss, Plaintiffs do not oppose Defendants’ argument that they are not taking title to the property at issue, nor does Plaintiffs raise concern that the alleged taking is not for a public purpose. (See ECF No. 53 at 20-24.) Because Plaintiffs’ arguments pertain to the diminished value and economic benefit of unserialized firearms and component parts, the Court finds only a regulatory takings analysis is warranted.
1. Regulatory Taking
Defendants argue that A.B. 286 is not a "physical appropriation" of property in violation of the Fifth Amendment's Takings Clause because the State is not taking title to unserialized firearms or component parts. (ECF No. 34 at 11.) Nor does the law violate the Takings Clause since the government is not required to compensate an owner when it prohibits a type of personal property through a "valid law." (Id. at 10-11.) Plaintiffs counter that unserialized firearms and component parts are subject to dispossession because A.B. 286 destroys or diminishes their value. (ECF No. 53 at 23.) A.B. 286 is thus a per se taking because it deprives all economically beneficial use of the property. (Id. at 23-14.) The Court disagrees with Plaintiffs.
The Supreme Court has articulated two guidelines for determining whether a government regulation is "onerous." See Murr v. Wisconsin , ––– U.S. ––––, 137 S. Ct. 1933, 1942-43, 198 L.Ed.2d 497 (2017). The first pertains to whether a regulation "denies all economically beneficial or productive use of" the property. Id. The second applies when a regulation does not so deny. In that case, "a taking still may be found based on a complex of factors , including (1) the economic impact of the regulation on the claimant; (2) the extent to which the regulation has interfered with distinct investment-backed expectations; and (3) the character of the governmental action." Id. (emphasis added and quotation marks omitted) (citing Penn Central Transp. Co. v. New York City , 438 U.S. 104, 124, 98 S.Ct. 2646, 57 L.Ed.2d 631 (1978) (" Penn Central " )).
Plaintiffs do not explicitly argue in their response that the Penn Central complex factors test has been met for there to be a regulatory taking. (See ECF No. 53 at 20-24.) Plaintiffs nevertheless conclude that the economic impact on the property at issue is "substantial" and the character of the government's action is an "invasion of property interests" that requires compensation in accordance with the Takings Clause. (Id. at 24.) But as the Court found in its previous Order, A.B. 286 does not deny all economically beneficial or productive use of unserialized firearms and component parts, nor is it clear based on the Complaint and the record the extent or certainty of the economic impact on Plaintiffs. (ECF No. 51 at 11-12.) Without more, and because Plaintiffs fail to argue the Penn Central complex factors test weigh in their favor, the Court declines to engage further analysis. The Court therefore finds that Plaintiffs have not sufficiently pled a regulatory taking claim.
2. Police Power
Even if the Court were to find there is a taking, regulatory or physical, Plaintiffs’ claim fails because A.B. 286 is an appropriate exercise of the government's police power. In their Motion, Defendants argue the government does not need to compensate Plaintiffs when A.B. 286 prohibits "a type of personal property" via a "valid law." (ECF No. 34 at 10.) That is because, according to Defendants, the Takings Clause does not restrict the government's traditional power to regulate and prohibit "dangerous private property." (Id. at 2.) Although not explicit, inherent in Defendants’ argument is that A.B. 286 is an appropriate exercise of the government's police power. Plaintiffs appears to counter that Defendants have not demonstrated unserialized firearms and component parts are either "dangerous," "unusual," or "both." (ECF No. 53 at 21.) The Court agrees with Defendants.
The police power exception to the Takings Clause provides that "[a] prohibition simply upon the use of property for purposes that are declared, by valid legislation, to be injurious to the health, morals, or safety of the community, cannot, in any just sense, be deemed a taking." Mugler v. Kansas , 123 U.S. 623, 668, 8 S.Ct. 273, 31 L.Ed. 205 (1887). "If [an] ordinance is otherwise a valid exercise of the [government's] police powers, the fact that it deprives the property of its most beneficial uses does not render it unconstitutional." Goldblatt v. Hempstead , 369 U.S. 590, 592, 82 S.Ct. 987, 8 L.Ed.2d 130 (1962) (collecting cases).
The Court is unaware of—and the parties have not pointed to—any binding Ninth Circuit case explicitly discussing police power exception to the Takings Clause in the context of firearms regulations. However, several other courts have applied this principle in finding that firearm regulations do not constitute a taking. See Akins v. United States , 82 Fed. Cl. 619, 623-24 (2008) (holding that prohibition on the sale of machine guns to anyone other than law enforcement agencies did not constitute a physical or regulatory taking); Fesjian v. Jefferson , 399 A.2d 861 (D.C. 1979) (holding that a statute requiring machine guns denied registration be sold, surrendered, or disposed, was a valid exercise of police power thereby not a taking); Rupp v. Becerra , Case No. 8:17-cv-00746-JLS-JDE, 2018 WL 2138452, *8-*9 (C.D. Cal. May 9, 2018) (dismissing a Takings claim on the grounds that a California prohibition on certain weapons represented an exercise of police power and not a taking). The Court finds this authority persuasive and concludes that firearm regulations may fall within the police power exception.
The Court notes in an unpublished opinion, Duncan v. Becerra , 742 F. App'x 218 (9th Cir. 2018), the Ninth Circuit was presented with a similar Takings Clause claim. But there, the Ninth Circuit affirmed the district court's findings on a deferential abuse of discretion standard. The Court finds the guidance from Duncan inconclusive as applied to the facts of this case.
While Plaintiffs contend Defendants have not demonstrated that the property at issue are "dangerous" or "unusual," Defendants—and the Nevada Legislature—have in fact adequately demonstrated that unserialized firearms and component parts are properly considered "dangerous private property." As discussed above, public safety and the importance of firearm tracing necessitates the prohibition of unserialized firearms and component parts. It is not clear what further showing Plaintiffs demand. Nevertheless, the Court finds that Defendants have properly invoke the police power exception, thus A.B. 286 is not a taking.
3. Nuisance Taking
In their opposition to the Motion, Plaintiffs also seek to characterize A.B. 286 as a "nuisance taking." (ECF No. 53 at 21-22.) Citing Lucas v. S.C. Coastal Council , 505 U.S. 1003, 1029, 112 S.Ct. 2886, 120 L.Ed.2d 798 (1992), Plaintiffs argue that A.B. 286 can only be proper if the property or its intended use has historically been prohibited. (Id. at 22.) Plaintiffs’ reliance on Lucas , however, is misplaced. In Lucas , the Supreme Court stated that, "when the owner of real property has been called upon to sacrifice all economically beneficial uses in the name of the common good, that is, to leave his property economically idle, he has suffered a taking." 505 U.S. at 1019, 112 S.Ct. 2886. Therefore, "[w]here a regulation ‘denies all economically beneficial or productive use of land,’ the multi-factor analysis established in Penn Central is not applied, and a compensable taking has occurred unless ‘the logically antecedent inquiry into the nature of the owner's estate shows that the proscribed use interests were not part of his title to begin with.’ " Esplanade Props., Ltd. Liab. Co. v. City of Seattle , 307 F.3d 978, 984 (9th Cir. 2002) (quoting Lucas , 505 U.S. at 1027, 112 S.Ct. 2886 ). But as the Court discussed above, A.B. 286 does not deny all economically beneficial or productive use of the property to be a per se taking. Even if the Court found differently, the Lucas decision articulated that compensation "must be accorded" to "regulations that prohibit all economically beneficial use of land [.]" 505 U.S. at 1029, 112 S.Ct. 2886 (emphasis added). A.B. 286, however, does not regulate land nor real property. Plaintiffs’ nuisance taking argument is therefore legally infirm.
Defendants have thus shown that as a matter of law, A.B. 286 cannot constitute a regulatory taking. The Court will thus dismiss Plaintiff's Fifth Amendment's Takings Clause claim.
V. LEAVE TO AMEND
Plaintiffs request the Court grant them leave to amend their Complaint, but Plaintiffs do not explain how their Complaint can be cured by amendment. (ECF No. 53 at 2.) The Court has discretion to grant leave to amend and should freely do so "when justice so requires." Allen v. City of Beverly Hills , 911 F.2d 367, 373 (9th Cir. 1990) (quoting Fed. R. Civ. P. 15(a) ). Because Plaintiffs do not challenge that public safety is a substantial or important government interest, nor do they argue that A.B. 286 is not a reasonable fit to the government's stated objective, the Court finds the deficiencies in the allegations regarding their Second Amendment claim do not appear to be curable. Moreover, the police power exception applies to the Fifth Amendment takings claim, and thus leave to amend that claim would be futile. Accordingly, Plaintiffs’ request for leave to amend their Complaint is denied.
VI. CONCLUSION
The Court notes that the parties made several arguments and cited to several cases not discussed above. The Court has reviewed these arguments and cases and determines that they do not warrant discussion as they do not affect the outcome of the Motion and the issues before the Court.
It is therefore ordered that Defendants’ motion to dismiss the complaint (ECF No. 34) is granted.