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LLC v. State of Hawaii Land Use Commission

United States District Court, D. Hawaii

December 20, 2018

BRIDGE AINA LE'A, LLC, Plaintiff,
v.
STATE OF HAWAII LAND USE COMMISSION; VLADIMIR P. DEVENS, in his individual and official capacity; KYLE CHOCK, in his individual and official capacity; THOMAS CONTRADES, in his individual and official capacity; LISA M. JUDGE, in her individual and official capacity; NORMAND R. LEZY, in his individual and official capacity; NICHOLAS W. TEVES, JR., in his individual and official capacity; RONALD I. HELLER, in his individual and official capacity; DUANE KANUHA, in his official capacity; CHARLES JENCKS, in his official capacity; JOHN DOES 1-10; JANE DOES 1-10; DOE PARTNERSHIPS 1-10; DOE CORPORATIONS 1-10; DOE ENTITIES 2-10; and DOE GOVERNMENTAL UNITS 1-10, Defendants.

          ORDER MODIFYING AND ADOPTING AS MODIFIED THE MAGISTRATE JUDGE'S FINDINGS AND RECOMMENDATIONS REGARDING ATTORNEYS' FEES AND COSTS

          SUSAN OKI MOLLWAY UNITED STATES DISTRICT JUDGE.

         I. INTRODUCTION.

         Plaintiff Bridge Aina Le'a (“Bridge”) and Defendant State of Hawaii Land Use Commission (the “LUC”) have filed separate objections to the Magistrate Judge's Findings & Recommendations (“F&R”) to grant in part and deny in part Plaintiff Bridge's Motion for Attorneys' Fees and Costs. See ECF Nos. 428, 429, 431.

         In the F&R, the Magistrate Judge recommended that this court deny Bridge any attorneys' fee award because Bridge is not entitled to fees under the private attorney general doctrine, and because the LUC's sovereign immunity bars any award of attorneys' fees. The Magistrate Judge also recommended that Bridge be awarded $15, 085.51 of its requested costs, including $1, 429.10 in copying costs.

         Bridge objects to the denial of its request for attorneys' fees and argues that it is entitled to the remainder of its requested costs. The LUC objects to the award of copying costs, arguing that it should be limited to $725.15.

         Having reviewed the F&R in light of the parties' objections, this court concludes that the LUC's waiver of Eleventh Amendment sovereign immunity extends to attorneys' fees and that therefore this court has jurisdiction over Bridge's request. However, the court agrees with the Magistrate Judge that Bridge does not meet the requirements for recovery under the private attorney general doctrine. The court also adopts the Magistrate Judge's recommendation that Bridge be awarded $15, 085.51 in costs.

         The court therefore adopts the F&R with modified reasoning on whether the LUC's sovereign immunity bars an award of attorneys' fees. The court denies Bridge's request for attorneys' fees and awards Bridge $15, 085.51 in costs. Pursuant to Local Rule 7.2(d), the court finds this matter suitable for disposition without a hearing.

         II. BACKGROUND.

         The factual and procedural background of this case has been discussed at length in the court's previous orders. See, e.g., ECF Nos. 131, 283, 318, 404. For the purposes of this order, the court adopts the F&R's background section, finding that it sets forth the relevant facts and noting that neither party raised any objections related to that section. See ECF No. 428, PageID #s 11303-06. Because the parties and the court are familiar with the background of this case, this court describes only those events relevant to the F&R and to Bridge's Motion.

         This case arises out of a decision by the LUC to reclassify a parcel of land owned by Bridge from urban use to agricultural use. See ECF No. 1. Bridge filed a Complaint in state court, asserting eleven counts against the LUC and some of its commissioners for violations under the United States Constitution, the Hawaii constitution, and various Hawaii laws. See ECF No. 1-2. The Complaint was then removed to this court based on federal question jurisdiction. See ECF No. 1. The case was stayed for several years pending the resolution of related state-court proceedings. See ECF No. 48.

         Following the completion of the state-court proceedings and this court's partial grant of the LUC's motion for summary judgment, Bridge had two takings claims that were tried to a jury. See ECF No. 131, PageID # 3112. On March 23, 2018, the jury found in favor of Bridge, concluding that the LUC's decision to reclassify the land constituted a taking under both the Lucas and Penn Central analyses. See ECF Nos. 372, 373. On March 30, 2018, the court awarded Bridge $1 in nominal damages.[1] See ECF No. 375. Bridge then filed the present Motion on April 13, 2018.[2] ECF No. 384.

         The F&R was filed on August 31, 2018, and both parties filed their objections shortly thereafter. ECF Nos. 428, 429, 431. This court requested supplemental briefs on the scope of the LUC's sovereign immunity in federal court, and the parties filed their supplemental briefs on December 3, 2018. ECF Nos. 434, 436, 437.

         III. STANDARD OF REVIEW.

         Congress has empowered magistrate judges, upon referral of dispositive pretrial motions by district judges, to conduct hearings and issue findings and recommendations regarding dispositive pretrial motions. See 28 U.S.C. § 636(b)(1)(B); see also Fed. R. Civ. P. 72(b) (promulgating rule). The Federal Rules of Civil Procedure permit a district judge to similarly refer a post-judgment motion for attorneys' fees “as if it were a dispositive pretrial matter, ” see Fed. R. Civ. P. 54(d)(2)(D), and such motions are customarily referred to magistrate judges in this district under Local Rule 54.3(h).

         A district judge reviews a magistrate judge's findings and recommendations prior to ruling on the motion, and may accept, reject, or modify, in whole or in part, the findings and recommendations made by the magistrate judge. Fed.R.Civ.P. 72(b). If a party timely objects to portions of the findings and recommendations, the district judge reviews those portions of the findings and recommendations de novo. Fed.R.Civ.P. 72(b)(3); Local Rule 74.2. The district judge may consider the record developed before the magistrate judge. Local Rule 74.2. The district judge also has discretion to receive further evidence. 28 U.S.C. § 636(b)(1); Fed.R.Civ.P. 72(b)(3); Local Rule 74.2; see also United States v. Raddatz, 447 U.S. 667, 676 (1980) (explaining that a district judge has wide discretion in deciding whether to allow new evidence). The de novo standard requires the district court to consider a matter anew and arrive at its own independent conclusions, but a de novo hearing is not ordinarily required. See United States v. Remsing, 874 F.2d 614, 617 (9th Cir. 1989); United States v. Boulware, 350 F.Supp.2d 837, 841 (D. Haw. 2004); Local Rule 74.2.

         The district judge may accept the portions of the findings and recommendations to which the parties have not objected as long as it is satisfied that there is no clear error on the face of the record. See United States v. Bright, Civ. No. 07-00311 ACK/KSC, 2009 WL 5064355, at *3 (D. Haw. Dec. 23, 2009); Stow v. Murashige, 288 F.Supp.2d 1122, 1127 (D. Haw. 2003); Fed.R.Civ.P. 72(b) advisory committee's note.

         IV. ANALYSIS.

         Bridge objects to the portions of the F&R that recommended denial of its request for an award of attorneys' fees, totaling $662, 227, 03, and to the portions recommending denial of $47, 724.55 of its requested costs. See ECF No. 429. The LUC filed cross-objections, arguing that the Magistrate Judge's recommended award of $1, 429.10 in copying costs should be reduced to $725.15. See ECF No. 431.

         Having performed a de novo review of the portions of the F&R to which the parties objected, the court adopts the Magistrate Judge's recommendations to deny Bridge's request for attorneys' fees and to award Bridge $15, 085.51 in costs. However, as an initial matter, the court modifies the Magistrate Judge's reasoning with respect to whether the LUC's sovereign immunity bars an award of attorneys' fees.

         A. This Court Is Not Barred from Awarding Attorneys' Fees to Bridge Because the LUC Waived Its Sovereign Immunity by Removing the Case.

         Bridge objects to the Magistrate Judge's conclusion that the LUC's sovereign immunity bars an award of attorneys' fees. See ECF No. 429, Page ID # 11347; ECF No. 428, PageID # 11324. The Magistrate Judge based its conclusion on the LUC's statement in a motion in limine that “removal to this Court ‘waived Eleventh Amendment immunity but not any other aspect of sovereign immunity.'” ECF No. 428, PageID # 11325 (quoting ECF No. 191-1, PageID # 4609). This court concludes that the LUC's waiver of Eleventh Amendment immunity extends to attorneys' fees and that the LUC's sovereign immunity is not a jurisdictional bar to an award of attorneys' fees by this court.

         The Eleventh Amendment provides that “[t]he Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State.” U.S. Const. amend. XI. Under the Eleventh Amendment, a state is immune from lawsuits for monetary damages or other retrospective relief brought in federal court by its own citizens or citizens of other states. Frew ex rel. Frew v. Hawkins, 540 U.S. 431, 437 (2004); Papasan v. Allain, 478 U.S. 265, 276 (1986); Pennhurst State Sch. & Hosp. v. Halderman, 465 U.S. 89, 100, 105-06 (1984). Federal court actions against agencies or instrumentalities of a state, such as the LUC, are also barred by the Eleventh Amendment. Sato v. Orange Cty. Dep't of Educ., 861 F.3d 923, 928 (9th Cir. 2017); Blount v. Sacramento Cty. Superior Court, 559 Fed.Appx. 623, 623 (9th Cir. 2014). Eleventh Amendment immunity does not apply if Congress exercises its power under the Fourteenth Amendment to override Eleventh Amendment immunity, or if a state consents to federal suit. See Will v. Mich. Dep't of State Police, 491 U.S. 58, 66-68 (1989); Pennhurst, 465 U.S. at 99.

         States have Eleventh Amendment immunity to takings claims seeking just compensation, meaning that federal courts lack jurisdiction over such claims. See Seven Up Pete Venture v. Schweitzer, 523 F.3d 948, 954 (9th Cir. 2008) (holding that “the constitutionally grounded self-executing nature of the Takings Clause does not alter the conventional application of the Eleventh Amendment”); see also City of Monterey v. Del Monte Dunes at Monterey, Ltd., 526 U.S. 687, 710 (1999) (“As its name suggests, . . . just compensation is, like ordinary money damages, a compensatory remedy.”).

         However, sovereign immunity is “quasi-jurisdictional in nature, ” meaning that it may be waived. See In re Bliemeister, 296 F.3d 858, 861 (9th Cir. 2002) (citing Hill v. Blind Indus. & Servs., 179 F.3d 754, 760 (9th Cir. 1999), amended by 201 F.3d 1186 (9th Cir. 2000)). A state may waive Eleventh Amendment immunity by voluntarily invoking federal jurisdiction or by engaging in “conduct that is incompatible with an intent to preserve that immunity.” See id.; Hill, 179 F.3d at 758. A state's removal of a case to federal court signals the state's voluntary invocation of federal jurisdiction for that case, whether the case involves state law claims, federal law claims, or both. See Lapides v. Bd. of Regents of Univ. Sys. of Ga., 535 U.S. 613, 624 (2002) (“[R]emoval is a form of voluntary invocation of a federal court's jurisdiction sufficient to waive the State's otherwise valid objection to litigation of a matter (here of state law) in a federal forum.”); Embury v. King, 361 F.3d 562, 564 (9th Cir. 2004) (“[T]he rule in Lapides applies to federal claims as well as to state claims and to claims asserted after removal as well as to those asserted before removal.”).

         Thus, when the LUC removed this case to this court, it voluntarily invoked federal jurisdiction and waived its Eleventh Amendment immunity with respect to Bridge's state and federal claims. The LUC conceded this waiver early in the case. See ECF No. 37, PageID # 327 (stating in the LUC's reply to Bridge's motion to dismiss, “Defendants do not dispute they waived the protections of the Eleventh Amendment by removing to this court.”). Additionally, the LUC's behavior during trial proceedings was consistent with waiver; it never raised a sovereign immunity defense and did not argue that this court lacked jurisdiction to award money damages against it. The LUC appears to concede as much. See ECF No. 37, PageID # 327 (“Defendants do not dispute they waived the protections of the Eleventh Amendment by removing to this court.”).

         Despite its waiver of Eleventh Amendment immunity, the LUC now argues that its sovereign immunity bars this court from awarding attorneys' fees. See ECF No. 399, PageID # 9551. The LUC appears to argue that its sovereign immunity in federal court is broader than the Eleventh Amendment and bars an award of attorneys' fees. It is true that “the sovereign immunity of the States neither derives from, nor is limited by, the terms of the Eleventh Amendment.” Alden v. Maine, 527 U.S. 706, 713 (1999). Thus, states have sovereign immunity from suit in their own courts, in addition to federal courts. See Id. However, this court is unaware of case law holding that, if a state waives Eleventh Amendment immunity and submits to the jurisdiction of a federal court, the state retains some additional sovereign immunity preventing the federal court from awarding attorneys' fees if the state is on the losing end of the litigation.

         Such a rule would give states an unfair tactical advantage in federal court. “In large part the rule governing voluntary invocations of federal jurisdiction has rested upon the problems of inconsistency and unfairness that a contrary rule of law would create.” Lapides, 535 U.S. at 622-23 (“And that determination reflects a belief that neither those who wrote the Eleventh Amendment nor the States themselves (insofar as they authorize litigation in federal courts) would intend to create that unfairness.” (internal citation omitted)). Inconsistency and unfairness would certainly result if a state could actively litigate a matter in federal court and then invoke sovereign immunity post-trial. See Embury, 361 F.3d at 566 (“[A]llowing the reassertion of Eleventh Amendment immunity, after the State had litigated extensively in federal court but began to anticipate an unfavorable outcome, would waste the time and money of the litigants and the resources of the courts.”). While this court understands that the LUC is saying that it waived only Eleventh Amendment immunity but retains some other aspect of sovereign immunity that bars a fee award, the problem is that the LUC cannot actually point to an operable immunity source that applies here.

         A more sensible understanding of the scope of sovereign immunity in federal court is that once a state voluntarily submits to federal jurisdiction, it cannot then pick and choose the stages of federal litigation in which it will participate. “Allowing a State to waive immunity to remove a case to federal court, then ‘unwaive' it to assert that the federal court could not act, would create a new definition of chutzpah.” Id.

         To be clear, the court is not saying that a waiver of Eleventh Amendment immunity via removal necessarily means that a state will pay attorneys' fees. Rather, it means that the court may exercise jurisdiction to award attorneys' fees provided the plaintiff proves that it is entitled to such an award (which, as discussed below, Bridge has not proven here). Nor is this court saying that Eleventh Amendment immunity is the only kind of sovereign immunity the LUC enjoys. What the court ...


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