United States District Court, D. Nevada
R. HICKS UNITED STATES DISTRICT JUDGE.
State of Nevada Private Investigators Licensing Board
(“Board”), Kevin Ingram, Lori Irizarry, and Jason
Woodruff move to dismiss plaintiffs Mahmoud Hendi and ESI
Security, Inc.'s first amended complaint. ECF No. 20.
Plaintiffs opposed the motion, and defendants replied. ECF
Nos. 23. 24. The court now grants the motion in part,
dismissing the claim arising under federal law and remanding
the claims arising under state law to state court.
owns and serves as the president of ESI. ECF No. 19, ¶
1. ESI provides private security services to businesses,
individuals, and special events. Id., ¶ 2. It
has been in operation for twenty-three years. Id.,
¶ 11. Because ESI provides private security services,
the Board regulates its operations. Id., ¶ 3.
Ingram serves as the Board's executive director, and
Irrizary serves as the deputy executive director.
Id., ¶¶ 4-5. Woodruff previously worked
for the Board as an investigator. Id., ¶ 6.
ESI first obtained a license from the Board in 1994, the
Board has never imposed any major infractions against ESI.
Id., ¶ 11. But in March 2016, ESI entered into
a settlement agreement to resolve several notices of
violations. Id., ¶ 13. ESI did not admit
liability. Id. But it agreed to pay certain fines
and attorney fees according to a schedule. Id. It
also agreed to a probationary period, during which time it
would surrender its license to the Board if it were found
guilty on any new notices of violations by way of a hearing
in front of the Board. Id.
months later, the Board issued a new notice of violations
against ESI and imposed a small fine. Id., ¶
14. The Board issued the notice for ESI's failure to
register its sister company's employees with the Board.
Id. ESI appealed the notice and requested a hearing.
before the hearing could occur, ESI was served with a
complaint for failing to pay the Board per the schedule in
the settlement agreement. Id., ¶ 16. The
complaint recommended the revocation of ESI's license
based on its failure to make timely payments and on the new
notice of violations. Id.
later, the Board began the hearing on the notice of
violations and late payments. Id., ¶ 17. The
hearing was conducted on multiple days that spanned six
months. Id. The Board first determined that ESI was
guilty of not registering its sister company's employees
with the Board. Id. A small fine was imposed and
attorney fees were awarded. Id. The Board then
considered the late-payment issue, ultimately finding that
ESI was not late in making the payments. Id., ¶
18. The Board therefore concluded that the new notice of
violations could not alone warrant the revocation of
ESI's license. Id. Instead, a fine was imposed
and attorney fees were awarded again. Id. ESI has
petitioned for judicial review of both outcomes.
Id., ¶¶ 17-18.
alleges that defendants approached ESI's customers during
the pending administrative action and stated the following:
(1) ESI was going to lose its license; (2) ESI was using
unregistered employees; (3) ESI was overcharging for its
services; (4) ESI was understaffing events in violation of
contracts with customers; and (5) that defendants advised
ESI's customers to seek a different company for security
services. Id., ¶ 20.
further alleges that defendants approached its customers on
at least three occasions. Id. First, defendants told
representatives of a special event that ESI was using
unregistered employees. Id. Second, Woodruff caused
ESI to breach a contract with a casino by wrongfully ordering
certain employees off the premises, which then caused a
breach in the underlying contract. Id. And third,
Woodruff advised another company to replace ESI with a
different private security company. Id.
also alleges that defendants singled out his company based on
his Arab descent and on his religion. Id., ¶
now sue defendants, alleging (1) intentional interference
with contractual relations against the Board; (2)
interference with prospective business advantage against the
Board; (3) civil right violations under 42 U.S.C. § 1983
against all defendants; and (4) defamation per se against the
Board. ECF Nos. 1, 19. After the action was removed from
state court based on claim three, the initial complaint was
dismissed for failure to meaningfully distinguish between the
multiple defendants and multiple plaintiffs in regards to the
alleged actions and the alleged damages. ECF Nos. 1, 17.
Plaintiffs filed the first amended complaint, re-alleging the
four claims. ECF No. 19. Defendants now move to dismiss the
first amended complaint under Federal Rule of Civil Procedure
may seek the dismissal of a complaint under Federal Rule of
Civil Procedure 12(b)(6) for failure to state a legally
cognizable cause of action. See Fed. R. Civ. P.
12(b)(6) (stating that a party may file a motion to dismiss
for “failure to state a claim upon which relief can be
granted[.]”). To survive a motion to dismiss for
failure to state a claim, a complaint must satisfy the notice
pleading standard of Federal Rule 8(a)(2). See Mendiondo
v. Centinela Hosp. Med. Ctr., 521 F.3d 1097, 1103 (9th
Cir. 2008). Under Rule 8(a)(2), a complaint must contain
“a short and plain statement of the claim showing that
the pleader is entitled to relief.” Fed.R.Civ.P.
8(a)(2). Rule 8(a)(2) does not require detailed factual
allegations; however, a pleading that offers only
“‘labels and conclusions' or ‘a