Opinion
No. C 01-3707 MMC, (Docket Nos. 22, 30)
July 15, 2002
ORDER GRANTING DEFENDANTS' MOTION TO DISMISS
Before the Court are defendants City and County of San Francisco ("City") and Edwin M. Lee's ("Lee") Motion to Dismiss, filed February 1, 2002 pursuant to Younger v. Harris, 401 U.S. 37 (1971) and Rules 12 (b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure, and involuntary plaintiff Qwest Communications Group, Inc.'s ("Qwest") Motion to Drop Qwest as an Involuntary Plaintiff, filed March 19, 2002 pursuant to Rule 21. Having considered the papers filed in support of and in opposition to the motions, the finds the matters appropriate for decision on the papers, VACATES the hearing scheduled for July 12, 2002, and rules as follows.
Qwest also joins defendants' motion to dismiss to the extent that such motion is based on Younger and Rule 12(b)(1). See Qwest's Memorandum of Points and Authorites in Support of Motion to Dismiss, at 2.
BACKGROUND
Plaintiff Underground Construction Co. Inc. ("Underground") is a contractor that installs underground utility facilities in the public rights-of-way in the City and County of Francisco for various entities, including those providing telecommunication services. Qwest is a telecommunications services provider which hired Underground to provide installation services.
In November 2000, the Department of Public Works ("Department") commenced an investigation of Underground and Qwest to determine if Underground and Qwest violated local excavation ordinances while installing telecommunications conduit. (Compl. ¶¶ 25-26.) On December 19, 2000, the Department issued a Notice of Excavation Violation to Underground and Qwest, assessing penalties for installing conduits that exceeded the scope of their permits and violated local ordinances. (Id. ¶ 28.) Underground and Qwest formally objected to the penalties and sought administrative review of the citations. (Id. ¶ 29.) Lee, the Director of the Department, thereafter commenced an administrative hearing and appointed a hearing officer to hear evidence and issue a recommendation concerning the appropriate penalty. (Id. ¶¶ 38, 48.) On November 7, 2001, Underground filed the instant action, seeking a declaratory judgment that the City's excavation ordinances violate the Telecommunications Act of 1996 ("Telecommunications Act"), 47 U.S.C. § 151 et. seq., and an injunction "to halt the administrative proceedings initiated and ultimately to be decided by Director Lee." (Id. ¶¶ 7, 8.)
DISCUSSION
By the instant motions, the City and Qwest assert that Underground lacks standing under § 253(a) of the Telecommunications Act and that the Court should abstain from adjudicating the instant action under the Younger abstention doctrine.
A. Standing
In Count I, alleging a violation of the Telecommunications Act, and Court IV, alleging a violation of the Administrative Code and Telecommunications Act, Underground alleges that certain City ordinances violate § 253(a) of the Telecommunications Act. The City and Qwest contend that Underground lacks standing to assert rights under § 253(a) and, accordingly, that this Court lacks jurisdiction over the claims raised in Courts I and IV. See White v. Lee, 227 F.3d 1214, 1242 (9th Cir. 2000) (holding standing is necessary element of federal jurisdiction).
Count II alleges preemption of the subject ordinances by the Telecommunications Act; Count III alleges the administrative proceedings violate due process.
"The determination of whether a plaintiff has standing involves both constitutional and prudential limitations." See Hong Kong Supermarket v. Kizer, 830 F.2d 1078, 1081 (9th Cir. 1987). "In view of the basic policy of federal courts against unnecessary determination of constitutional issues," Courts first determine if "standing can be decided on the basis of one of the prudential limitations." Id. "The prudential limitations require the plaintiff to (1) assert his own rights, rather than rely on the rights or interests of third parties; (2) allege an injury that is more than a generalized grievance; and (3) allege an interest that is arguably within the zone of interest protected or regulated by the statute or constitutional guarantee in question." Id. Underground bears the burden of establishing jurisdiction. See McMichael v. County of Napa, 709 F.2d 1268, 1269 (9th Cir. 1983).
Underground has not meet its burden of establishing that it has standing to challenge the City's ordinances under § 253(a) of the Telecommunications Act. Section 253(a) provides: "No State or local statute or regulation, or other State or local legal requirement, may prohibit or have the effect of prohibiting the ability of any entity to provide any interstate or intrastate telecommunications service." 47 U.S.C. § 253 (a). Section 253(a) was enacted to "promote competition among and reduce regulation of telecommunications providers" by "prohibit[ing] state and local governments from creating `barriers to entry,'" specifically, "legal requirements that prohibit or have the effect of prohibiting a company from providing telecommunications service." See City of Auburn v. Qwest Corp., 260 F.3d 1160, 1170 (9th Cir. 2001). Here, Underground is not a company that provides or seeks to provide telecommunications services. Rather, Underground is a construction company that installs conduit for telecommunication providers. As such, Underground is not "within the zone of interest protected or regulated by the statute or constitutional guarantee in question." See Hong Kong, 830 F.2d at 1081. Nor can Underground acquire standing by joining Qwest, a telecommunications services provider, as an involuntary plaintiff. Underground must "assert his own rights, rather than rely on the rights or interests of third parties." See id. (holding vendor did not have standing to sue on behalf of customers).
Accordingly, Underground has not meet its burden of demonstrating that it has standing to assert rights under § 253(a) of the Telecommunication Act and, to the extent the claims asserted in Courts I and IV are based on the Telecommunications Act, this Court lacks jurisdiction over such claims
B. Younger Abstention
Defendants and Qwest also assert that the Court must dismiss the instant action under the Younger abstention doctrine. See Younger, 401 U.S. at 41; Beltran v. State of California, 871 F.2d 777, 782 (9th Cir. 1989) (holding district court must dismiss federal action where Younger abstention is appropriate). "Abstention by a district court is required under Younger when three criteria are satisfied: (1) State judicial proceedings are ongoing; (2) The proceedings implicate important state interests; and (3) The state proceedings provide an adequate opportunity to raise federal questions." See Communications Telesystems International v. California Public Utility Commission, 196 F.3d 1011, 1015 (9th Cir. 1999). Even where these factors are met, "the Younger doctrine applies only when . . . the federal relief sought would interfere in some manner in the state court litigation." See Green v. City of Tucson, 255 F.3d 1086, 1094 (9th Cir. 2001). This requirement ordinarily restricts application of the Younger doctrine to situations where, as here, "the state court proceeding is an enforcement action against the federal court plaintiff." See id.
Here, the parties are currently involved in state administrative proceedings before a hearing officer appointed by the Department. See Ohio Civil Rights Commission v. Dayton Christian Schools, Inc., 477 U.S. 619, 627 (1986) (holding Younger doctrine applicable to state administrative proceedings). Underground does not dispute that the proceedings implicate important state interests and that the instant action seeks to interfere with such proceedings. Rather, Underground asserts that the administrative proceedings are not "ongoing" and that the state proceedings do not provide an adequate opportunity to raise federal questions.
Underground argues that the proceedings are not "ongoing" because the hearing officer granted a stay pending this Court's ruling on defendants' instant motion to dismiss. Underground, however, cites no authority for the proposition that a proceeding is not "ongoing" for Younger purposes simply because a temporary stay has been entered. Nor can Underground demonstrate that a proceeding is not ongoing merely because a party is displeased with the rulings made therein and refuses to further participate. Allowing a party to avoid abstention by refusing to continue participating in an ongoing proceeding would eviscerate the Younger doctrine.
The stay was granted at the request of the Department.
Underground next argues that the state proceedings do not provide an adequate opportunity to raise federal questions because the hearing officer cannot adjudicate Underground's constitutional claims. Although the California Constitution prohibits administrative agencies from adjudicating the constitutionality of state statutes, see Cal. Const., art. III § 3.5, Underground has a full opportunity to raise its federal Constitutional claims in an appeal of the administrative decision before a state court. See Cal. Civ. Proc. Code § 1094.5 (allowing judicial review of final orders issued in administrative proceedings); Beltran, 871 F.2d at 783 ("Even if Article III, section 3.5 of the California Constitution prohibited appellees from raising their federal claims before the [agency], appellees "ha[d] a full opportunity to raise their federal claims before the [California] Court of Appeal.") The state proceedings, therefore, provide an adequate opportunity to raise federal questions. Consequently, each of the factors in the Younger abstention test have been satisfied in the instant action.
Finally, Underground asserts that Younger does not apply because Lee is biased. "Although a federal court is normally required to abstain if the three prongs of the Younger test are satisfied, abstention is inappropriate in the `extraordinary circumstance' that the state tribunal is incompetent by reason of bias." See Hirsch v. Justices of the Supreme Court of California, 67 F.3d 708, 713 (9th Cir. 1995). To show bias, Underground must overcome "the presumption of honesty and integrity of those serving as adjudicators." See id. In an effort to do so, Underground asserts that the administrative process is "biased by prejudgment and pecuniary interest." (Opp'n at 16.) Specifically, Underground asserts that Lee has a financial interest in the outcome of the proceedings because, if Underground is required to pay fines or forfeit its facilities, the City would benefit financially. In the absence of evidence that Lee's salary or benefits "are in any way dependent on the amount of fines collected," however, such allegations regarding the City's financial interest are insufficient to demonstrate that Lee is biased. See Hirsch, 67 F.3d at 714 (holding Bar Court judges do not have an impermissible financial interest where fines assessed are paid to the treasury of the State Bar). Underground also asserts that Lee has predetermined the issues before him and that certain decisions made by Lee during the course of the proceedings were "retaliatory." (Opp'n at 22.) Underground, however, has failed to offer any evidence in support of this assertion. Underground, therefore, has failed to demonstrate that Lee is biased.
Under the City's Public Works Code, Lee ultimately has the authority to accept or reject the hearing officer's decision. See PWC § 2.4.81(k). There is no assertion that the hearing officer herself is biased.
Accordingly, Younger abstention is appropriate and the Court will dismiss the instant action in its entirety.
In light of the dismissal on the above-discussed grounds, the Court need not reach the question of whether Qwest was improperly joined under Rule 19 or whether Underground's claims are also subject to dismissal under Rule 12(b)(6).
CONCLUSION
For the reasons stated, the complaint is hereby DISMISSED.This order terminates Docket Nos. 22 and 30.
The Clerk shall close the file.
IT IS SO ORDERED.