Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_04-cv-00945/USCOURTS-caed-2_04-cv-00945-0/pdf.json

Nature of Suit Code: 440
Nature of Suit: Other Civil Rights
Cause of Action: 42:1983 Civil Rights Act

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UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

BERNARD JOSEPH ROSA, JR.,

Plaintiff,

v.

STATE OF CALIFORNIA, CALIFORNIA

BOARD OF ACCOUNTANCY, CALIFORNIA

ATTORNEY GENERAL BILL LOCKYER,

CAROL SIGMANN, GREGORY P.

NEWINGTON, LAWRENCE KNAPP, JOEL

PRIMES, RONALD DIEDRICH, MICHAEL

R. GRANEN, AND STEVEN J. SMITH,

Defendants.

CIV S-04-0945 WBS PAN PS

FINDINGS AND RECOMMENDATIONS

—NFN—

Plaintiff, proceeding pro se, filed his first amended

complaint on July 14, 2004, alleging violation of his due process

rights under the federal and state Constitutions, and alleging

state law claims of defamation, intentional and negligent

infliction of emotional distress, bias and nonfeasance of public

officers. Defendants move to dismiss or for more definite

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statement; plaintiff moves for summary judgment. 

The following facts are set forth in plaintiff’s first

amended complaint. Plaintiff became licensed as a certified

public accountant in 1969 and pursued his career in good standing

until 1983 when a former client complained to the California

Board of Accountancy that plaintiff was promoting a fraudulent

tax reduction strategy. The Board filed formal charges and in 

December 1993, plaintiff orally agreed with the Board’s

representatives, including members of the Attorney General’s

office, to a stipulation of discipline omitting all references to

fraud, dishonesty and gross negligence. Defendants persuaded

plaintiff to sign a blank signature page which was later attached

to the written stipulation. Plaintiff scanned but did not read

the stipulation prior to meeting with the Board in April 1994 “to

confirm the terms of probation.” First Amended Complaint, at

paras. 12, 13. In November 1994 plaintiff became aware that the

written stipulation failed to reflect the parties’ oral

agreement. Plaintiff informed the Board, the Attorney General’s

office, and the Attorney General’s Investigative Unit in Los

Angeles; however, none made the requested correction. Thereafter

a “probation hearing” was held before an administrative law judge

who “refused plaintiff’s attempts to explain how the purported

agreement was gotten,” resulting in further probation terms and

suspension of plaintiff’s CPA license. Id., at para. 15. In

December 1995 the Board revoked plaintiff’s license. Plaintiff

became despondent and drifted from his profession until 1999 when

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1 The complaint names the “Board of Accountancy, Depts. Of Justice

Attorney General & Adm. Hearings.” First Amended Complaint (attachment). 

Plaintiff has since provided the July 22, 2004, tentative ruling of the

California Victim Compensation and Government Claims Board recommending

plaintiff’s claim be rejected “because the claim raises complex issues of fact

and law that should be resolved through formal legal action” and informing

plaintiff the Board would act on his claim August 27, 2004. Exhibit A to

Opposition to Motion to Dismiss. Plaintiff has not submitted the final

decision.

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he filed a petition for reinstatement. The petition was denied

October 1999. A second petition was denied March 2001, a third

denied July 2002, others denied in 2003, and most recently in

April 2004. Plaintiff states defendants relied on the fraudulent

stipulation to deny his petitions for reinstatement, decline to

hear any evidence on the issue, and to place plaintiff in a

conundrum by refusing his proof of rehabilitation but equating

such offer with an admission of guilt. Plaintiff contends

defendants’ “use of the stipulation and . . . refusal to hear

evidence about the purported stipulation,” refusal to accept his

proofs of rehabilitation, and “wrongfully taking plaintiff’s CPA

certificate using fraudulent evidence,” constitute a denial of

federal due process rights. Id., at paras. 15, 19-22, 27. 

Plaintiff seeks reinstatement of his CPA license, $2,000,000

general damages, $1,500,000 punitive damages, and costs. 

Plaintiff states he has complied with the California Tort

Claims Act by mailing a complaint to the Board of Claims on June

28, 2004 (First Amended Complaint (filed July 14, 2004), at para.

54) but has not demonstrated exhaustion.1 He has, however, filed

a writ of mandate in the Sacramento County Superior Court to set

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aside the Board’s April 2004 decision again denying reinstatement

of his license. Id., at para. 53. Plaintiff’s failure to

demonstrate exhaustion of state administrative remedies pursuant

to the California Tort Claims Act is not a prerequisite to

pursuing a cognizable federal cause of action (see Patsy v. Board

of Regents of State of Florida, 457 U.S. 496, 501 (1982)

(exhaustion of state remedies not a prerequisite to a valid §

1983 action). 

On a motion to dismiss pursuant to F. R. Civ. P.

12(b)(6), the court must accept plaintiff’s allegations as true,

read the complaint most favorably to plaintiff, give plaintiff

the benefit of every reasonable inference that appears from the

pleading and argument of the case and dismiss the complaint only

if it is clear that no relief could be granted under any set of

facts that could be proved consistent with the allegations. 

Wheeldin v. Wheeler, 373 U.S. 647, 658 (1963); Retail Clerks

International Association, Local 1625, AFL-CIO v. Schermerhorn,

373 U.S. 746, 754, n. 6 (1963); Hishon v. King & Spalding, 467

U.S. 69, 73 (1984). 

Section 1983 provides, in pertinent part, that "(e)very

person who, under color of any statute of any state . . .,

subjects, or causes to be subjected, any citizen of the United

States or other person within the jurisdiction thereof to the

deprivation of any rights, privileges, or immunities secured by

the Constitution and laws, shall be liable to the party injured .

. . ." 

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2 “[T]here exists a variety of interests which are difficult of

definition but are nevertheless comprehended within the meaning of either

‘liberty’ or ‘property’ as meant in the Due Process Clause. These interests

attain this constitutional status by virtue of the fact that they have been

initially recognized and protected by state law, and we have repeatedly ruled

that the procedural guarantees of the Fourteenth Amendment apply whenever the

State seeks to remove or significantly alter that protected status.” Paul v.

Davis, 424 U.S. 693, 710-711 (1976). “Once licenses are issued . . . their

continued possession may become essential in the pursuit of a livelihood. 

Suspension of issued licenses thus involves state action that adjudicates

important interests of the licensees. In such cases the licenses are not to be

taken away without that procedural due process required by the Fourteenth

Amendment. Sniadach v. Family Finance Corp., 395 U.S. 337 (1969); Goldberg v.

Kelly, 397 U.S. 254 (1970). This is but an application of the general

proposition that relevant constitutional restraints limit state power to

terminate an entitlement whether the entitlement is denominated a ‘right’ or a

‘privilege.’” Bell v. Burson, 402 U.S. 535, 539 (1971).

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Revocation of a state-created right such as a

professional license must comply with due process of law,2 which

is met by adequate notice, a hearing, the opportunity to be

heard, and the opportunity for judicial review. See, e.g.,

Mathews v. Eldridge, 424 U.S. 319, 349 (1976) (“the prescribed

procedures not only provide the claimant with an effective

process for asserting his claim prior to any administrative

action, but also assure a right to an evidentiary hearing, as

well as to subsequent judicial review [here, plaintiff’s state

writ of mandate], before the denial of his claim becomes final”). 

Within these parameters, courts defer to the reasoned discretion

of administrative decisions. See, e.g., Willner v. Committee on

Character and Fitness, 373 U.S. 96, 103 (1963), quoting Goldsmith

v. U.S. Board of Tax Appeals, 270 U.S. 117, 123 (1926) (agency

discretion is “to be exercised after fair investigation, with

such a notice, hearing and opportunity to answer for the

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applicant as would constitute due process”). 

Plaintiff’s post-deprivation pursuit of his rights

pursuant to the California Tort Claims Act and a state writ of

mandate not only satisfies these requirements but extinguishes

plaintiff’s federal due process claim. “[A]n unauthorized

intentional deprivation of property by a state employee does not

constitute a violation of the procedural requirements of the Due

Process Clause of the Fourteenth Amendment if a meaningful

postdeprivation remedy for the loss is available.” Hudson v.

Palmer, 468 U.S. 517, 533 (1984); see also Barnett v. Centoni, 31

F.3d 813, 816 (9th Cir. 1994) ("[N]egligent or intentional

deprivation of a prisoner's property fails to state a claim under

section 1983 if the state has an adequate post deprivation

remedy."). The California Tort Claims Act, Cal. Govt. Code § 810

et seq., provides an adequate postdeprivation remedy for loss of

property. See Barnett v. Centoni, 31 F.3d 813, 816-17 (9th Cir.

1994).

Accordingly, I recommend defendants’ motion to dismiss be

granted in its entirety. If plaintiff’s allegations state any

claim for relief under state law, this court should decline to

exercise its supplemental jurisdiction over them pursuant to 28

U.S.C. § 1367(c)(3). 

Plaintiff’s motion for summary judgment based on

defendants’ failure to deny plaintiff’s “statement of undisputed

facts” in support thereof and defendants’ purportedly untimely

motion to dismiss should be denied. Defendants were under no

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obligation to refute plaintiff’s statement of facts given the

pendency of their motion to dismiss, which was timely filed (see

Aetna Life Ins. Co. v. Alla Medical Services, Inc., 855 F.2d

1470, 1474 (9th Cir. 1988)(“This circuit allows a motion under

Rule 12(b) any time before the responsive pleading is filed”). 

These findings and recommendations are submitted to the

Honorable William B. Shubb, the United States District Judge

assigned to this case. 28 U.S.C. § 636(b)(l). Written

objections may be filed within ten days after being served with

these findings and recommendations. The document should be

captioned “Objections to Magistrate Judge’s Findings and

Recommendations.” The failure to file objections within the

specified time may waive the right to appeal the District Court’s

order. Martinez v. Ylst, 951 F.2d 1153 (9th Cir. 1991).

Dated: June 6, 2005. 

 /s/ Peter A. Nowinski 

 PETER A. NOWINSKI

 Magistrate Judge

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