United States District Court, D. Nevada
TOP RANK BUILDERS, INC., and EFRAIN RENE MORALES MORENO, Plaintiffs,
CHARLES ABBOTT ASSOCIATES, INC.; WILLIAM B. BROWNING; AMERICAN WIND & SOLAR, INC.; COUNTY OF NYE; DOES I through X, inclusive; and ROE ENTITIES XI through XX, inclusive, Defendants.
ORDER GRANTING DEFENDANT NYE COUNTY'S MOTION TO
PARTIALLY DISMISS (ECF NO. 11)
P. GORDON, UNITED STATES DISTRICT JUDGE.
Top Rank Builders, Inc. and Efrain Morales are suing Charles
Abbott Associates, Inc. (CAA), William Browning, American
Wind & Solar, Inc. (American), and Nye County for
injuries allegedly caused by Browning abusing his position as
a building official in Nye County. Nye County moves to dismiss
the racketeering claims against it, arguing that as a
government entity, it cannot be held liable under
racketeering statutes. Top Rank and Morales attempt to
distinguish the cases cited by Nye County and move to amend
Ninth Circuit has held that government entities are incapable
of forming the intent necessary to support a federal
Racketeer Influenced Corrupt Organizations Act (RICO) action.
While the Supreme Court of Nevada has not yet ruled on this
specific issue with respect to the state racketeering
statute, it has held that the statute is patterned on the
federal RICO statute. The requirement of criminal intent to
engage in racketeering activity is consistent across both
statutes. Therefore, I grant Nye County's motion to
dismiss both racketeering claims against it.
August, 2011, CAA renewed its Professional Services Agreement
(PSA) with Nye County to establish, maintain, and staff a
building and safety services department. ECF No. 1 at 5.
William Browning, an employee of CAA, was employed as the
“building official” of the Pahrump Building &
Safety Department and was in charge of administration and
enforcement of building codes. Id. at 6. Browning
also served on the Capital Improvements Advisory Committee
for the Pahrump Regional Planning District as a voting
administrative official and member. Id. at 7. When
Nye County began the selection process for licensed medical
marijuana facilities in 2014, Browning was an integral party
to the process alongside the Nye County Planning Department.
Rank and Morales were under contract with one of the
prospective licensees, Green Cross of America, Inc..
Id. at 8. After Green Cross won approval of its
special use application, Top Rank and Morales entered into a
“definitive agreement” to be the general
contractor on the medical marijuana facility project.
Id. at 8-9. At some later point, Morales visited the
job site and saw an American employee looking at plans for
the project. Id. at 9. Morales was then informed by
Green Cross that Browning had told it that if it
“replaced Top Rank, with Browning, Green Cross would
never have to worry about a building permit again.”
Id. Green Cross told Morales that Browning intended
to use another contractor as a front for Browning and
American. Id. Browning allegedly delayed
issuing permits to the Green Cross project to pressure Green
Cross into replacing Top Rank with Browning's front
contractor. Id. at 10.
Rank and Morales allege Nye County had “actual or
constructive knowledge” of Browning's conduct,
which breached the PSA's requirement that no CAA
employees be financially interested in matters connected to
CAA's functions under the agreement. Id.
Further, Nye County did not declare a breach of the agreement
based on its knowledge of Browning's activities, nor did
it take action to prevent Browning from using his position
for private gain. Id. at 10-11.
2016, Browning delayed approving another work permit for Top
Rank and allegedly used the delay to contact property owners
and convince them to use his companies rather than Top Rank.
Id. at 11. Finally, Top Rank and Morales allege
Browning “caused a false and meritless claim to be
filed” against Top Rank and Morales with the Nevada
State Contractors Board. Id. Nye County refused to
withdraw the complaint. Id.
Rank and Morales filed suit against CAA, Browning, American,
and Nye County alleging, among other things, claims against
Nye County for federal racketeering under 18 U.S.C. §
1962 and state racketeering under Nevada Revised Statutes
§ 207.470. Nye County moves to dismiss these
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
Atl. Corp. v. Twombly, 550 U.S. 544, 555 (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
(2009). “Factual allegations must be enough to rise
above the speculative level.” Twombly, 550
U.S. at 555. To survive a motion to dismiss, a complaint must
“contain enough facts to state a claim to relief that
is plausible on its face.” Iqbal, 556 U.S. at
696 (internal quotation marks and citation omitted).
a two-step approach when considering motions to dismiss.
Id. at 679. First, I must accept as true all
well-pleaded factual allegations and draw all reasonable
inferences from the complaint in the plaintiff's favor.
Id.; Brown v. Elec. Arts, Inc., 724 F.3d
1235, 1247-48 (9th Cir. 2013). Legal conclusions, however,
are not entitled to the same assumption of truth even if cast
in the form of factual allegations. Iqbal, 556 U.S.
at 679; Brown, 724 F.3d at 1248. Mere recitals of
the elements of a cause of action, supported by only
conclusory statements, do not suffice. Iqbal, 556
U.S. at 678.
I must consider whether the factual allegations in the
complaint allege a plausible claim for relief. Id.
at 679. A claim is facially plausible when the complaint
alleges facts that allow the court to draw a reasonable
inference that the defendant is liable for the alleged
misconduct. Id. at 663. Where the complaint does not
permit the court to infer more than the mere possibility of
misconduct, the complaint has “alleged-but it has not
shown-that the pleader is entitled to relief.”
Id. at 679 (internal quotation marks and citations
omitted). When the claims have not crossed the line from
conceivable to plausible, the complaint must be dismissed.
Twombly, 550 U.S. at 570. “Determining whether
a complaint states a plausible claim for relief will . . . be
a context-specific task that requires [me] to draw on [my]
judicial experience and common sense.” Iqbal,
556 U.S. at 679.