Source: http://id.findacase.com/research/wfrmDocViewer.aspx/xq/fac.20170130_0000043.DID.htm/qx
Timestamp: 2017-06-24 22:35:50
Document Index: 633363826

Matched Legal Cases: ['§ 67', '§ 67', '§\n1983', '§ 67', '§ 67', '§\n67', '§ 1983']

| Education Networks of America, Inc. v. Wasden
Education Networks of America, Inc. v. Wasden
EDUCATION NETWORKS OF AMERICA, INC., a Delaware Corporation, Plaintiff,v.LAWRENCE G. WASDEN, Attorney General for the State of Idaho; J. MICHAEL GWARTNEY, in his official capacity and personal capacity as the former Director and Chief Information Officer of the Idaho Department of Administration; AMERICAN FALLS SCHOOL DISTRICT #381; ANOTHER CHOICE VIRTUAL CHARTER SCHOOL; BOUNDARY COUNTY SCHOOL DISTRICT #101; BRUNEAU-GRAND VIEW JOINT SCHOOL DISTRICT #365; CAMAS COUNTY DISTRICT #121; CASCADE SCHOOL DISTRICT #422; CASTLEFORD DISTRICT #417; COTTONWOOD JOINT SCHOOL DISTRICT #242; EMMETT INDEPENDENT SCHOOL DISTRICT #221; FIRTH SCHOOL DISTRICT #59; FREMONT COUNTY JOINT SCHOOL DISTRICT #215; HIGHLAND SCHOOL DISTRICT #305; IDAHO ARTS CHARTER SCHOOL; IDAHO EDUCATIONAL SERVICES FOR THE DEAF AND THE BLIND #596; IDAHO DIGITAL LEARNING ACADEMY; JEROME SCHOOL DISTRICT #261; SALMON RIVER SCHOOL DISTRICT #243; KAMIAH JOINT SCHOOL DISTRICT #304; KUNA SCHOOL DISTRICT #3; MELBA SCHOOL DISTRICT #136; MERIDIAN TECHNICAL CHARTER HIGH SCHOOL; MIDDLETON SCHOOL DISTRICT #134; MOSCOW SCHOOL DISTRICT #281; MOUNTAIN HOME SCHOOL DISTRICT #193; MOUNTAIN VIEW SCHOOL DISTRICT #244; NAMPA SCHOOL DISTRICT #131; NEW PLYMOUTH SCHOOL DISTRICT #372; OROFINO JOINT SCHOOL DISTRICT #171; PAYETTE SCHOOL DISTRICT #371; POCATELLO/ CHUBBUCK SCHOOL DISTRICT #25; RIRIE SCHOOL DISTRICT #252; SNAKE RIVER SCHOOL DISTRICT #52; TETON COUNTY SCHOOL DISTRICT #401; TWIN FALLS SCHOOL DISTRICT #411; WEST BONNER COUNTY SCHOOL DISTRICT #83; WEST JEFFERSON SCHOOL DISTRICT #253; WEST SIDE JOINT SCHOOL DISTRICT #202; SNAKE RIVER SCHOOL COMMUNITY LIBRARY, Defendants.
Lynn Winmill, United States District Court Chief Judge.
before the Court is a Motion to Dismiss filed by Defendants
J. Michael Gwartney and Lawrence G. Wasen. (Dkt. 21). The
Court heard oral argument on January 11, 2017 and took the
motion under advisement. For the reasons explained below, the
action stems from the State of Idaho's efforts to
establish the Idaho Education Network (IEN), a high-bandwidth
telecommunications distribution system for public schools in
the state. Plaintiff ENA Services, LLC filed this action to
recover compensation for services it rendered under the IEN
and to enjoin the state from attempting to recover state
funds ENA has already received for such work.
Idaho Legislature authorized the creation of the IEN in 2008
to facilitate distance education, teacher training, and other
related services for Idaho public schools. First Amended
Compl. ¶ 29, Dkt. 14. In December 2008, the Idaho
Department of Administration (DOA), the agency responsible
for administering state contracts, issued a Request for
Proposals (RFP) for the first phase of the IEN. Id.
¶ 24. Defendant J. Michael Gwartney was the Director of
the Department of Administration at that time. Id.
¶ 11. ENA and Qwest Communications Company both
submitted bids to provide telecommunication services for the
project. Id. ¶ 25. In January 2009, the
Department of Administration awarded identical purchase order
contracts-known as Statewide Blanket Purchase Orders
(SBPOs)-to both ENA and Qwest. Id. ¶ 29. One
month later, the Department of Administration unilaterally
amended the SBPOs to allocate certain portions of the IEN
work exclusively to ENA and other portions exclusively to
Qwest. Id. ¶¶ 29, 37. The providers then
designed, engineered, and priced the circuits for the IEN,
and the State ordered services from the providers under the
SBPOs. Id. ¶¶ 46, 87.
December 2009, the State, ENA, and Qwest became involved as
co-defendants in state-court litigation filed by Syringa
Networks, LLC, in which Syringa challenged the bidding
process for the IEN. Id. ¶¶ 50-84. While
this litigation was pending, the State continued to order and
accept services from ENA. Id. ¶¶ 64, 84.
In a decision entered on November 10, 2014, the Idaho
district court granted summary judgment for Syringa, holding
that the Department of Administration's unilateral
contract amendments violated state procurement laws and for
that reason, the SBPOs were void ab initio.
Id. ¶ 73. It entered a final judgement to that
effect in February 2015. Def.'s Br. at 4. At
that point, the Idaho legislature withdrew its appropriation
of funds for the IEN and the State ceased all orders under
the project. Id. On March 1, 2016, the Idaho Supreme
Court upheld the district court's determination that
tainted contracts were void ab initio. First
Amended Compl. ¶¶ 79-83; Syringa Networks,
LLC v. Idaho Dep't of Admin. (“Syringa
II”), 367 P.3d 208, 223 (Idaho 2016).
the Idaho Supreme Court's Syringa II decision,
the Idaho Attorney General Lawrence G. Wasden demanded
repayment of all sums “advanced” to ENA for IEN
services, pursuant to Idaho Code § 67-9213 (formerly
§ 67-5725).[1] ENA brings this lawsuit to enjoin Wasden
from seeking repayment and to recover additional compensation
from designated school districts and libraries throughout the
state of Idaho for services rendered by ENA to said
Defendants. Additionally, ENA asserts constitutional claims
against Wasden and Gwartney, pursuant to 42 U.S.C. §
1983, for a deprivation of rights secured by the Contracts
Clause, Due Process Clause, and Takings Clause of the U.S.
Rule of Civil Procedure 8(a)(2) requires only “a short
entitled to relief, ” in order to “give the
grounds upon which it rests.” Bell Atlantic Corp.
v. Twombly, 550 U.S. 544, 555 (2007). While a complaint
attacked by a Rule 12(b)(6) motion to dismiss “does not
need detailed factual allegations, ” it must set forth
do.” Id. at 555. To survive a motion to
accepted as true, to “state a claim to relief that is
plausible on its face.” Id. at 570. A claim
alleged. Id. at 556. The plausibility standard is
not akin to a “probability requirement, ” but it
asks for more than a sheer possibility that a defendant has
acted unlawfully. Id. Where a complaint pleads facts
that are “merely consistent with” a
between possibility and plausibility of ‘entitlement to
relief.'” Id. at 557.
Supreme Court identified two “working principles”
that underlie Twombly in Ashcroft v. Iqbal,
556 U.S. 662, 678 (2009). First, the court need not accept as
true, legal conclusions that are couched as factual
allegations. Id. Rule 8 does not “unlock the
doors of discovery for a plaintiff armed with nothing more
than conclusions.” Id. at 678-79. Second, to
survive a motion to dismiss, a complaint must state a
plausible claim for relief. Id. at 679.
“Determining whether a complaint states a plausible
claim for relief will . . . be a context-specific task that
requires the reviewing court to draw on its judicial
experience and common sense.” Id.
dismissal without leave to amend is improper unless it is
beyond doubt that the complaint “could not be saved by
any amendment.” Harris v. Amgen, Inc., 573
F.3d 728, 737 (9th Cir. 2009) (issued 2 months after Iqbal).
The Ninth Circuit has held that “in dismissals for
failure to state a claim, a district court should grant leave
to amend even if no request to amend the pleading was made,
unless it determines that the pleading could not possibly be
cured by the allegation of other facts.” Cook,
Perkiss and Liehe, Inc. v. Northern California Collection
Service, Inc., 911 F.2d 242, 247 (9th Cir. 1990). The
issue is not whether plaintiff will prevail but whether he
“is entitled to offer evidence to support the
claims.” Diaz v. Int'l Longshore and Warehouse
Union, Local 13, 474 F.3d 1202, 1205 (9th Cir. 2007)
Rule 12(b)(6), the Court may consider matters that are
subject to judicial notice. Mullis v. United States
Bank, 828 F.2d 1385, 1388 (9th Cir. 1987). The Court may
take judicial notice “of the records of state agencies
and other undisputed matters of public record” without
transforming the motions to dismiss into motions for summary
judgment. Disabled Rights Action Comm. v. Las Vegas
Events, Inc., 375 F.3d 861, 866, n.1 (9th Cir. 2004).
The Court may also examine documents referred to in the
complaint, although not attached thereto, without
transforming the motion to dismiss into a motion for summary
judgment. See Knievel v. ESPN, 393 F.3d 1068, 1076
styled as a motion to dismiss pursuant to Rule 12(b)(6),
Defendants' motion also argues that the
Rooker-Feldman doctrine deprives this Court of
subject matter jurisdiction. For purposes of that
jurisdictional challenge, the Court will consider the motion
as one brought pursuant to Federal Rule of Civil Procedure
subject matter jurisdiction is challenged pursuant to Rule
12(b)(1), the plaintiff bears the burden of persuasion.
Indus. Tectonics, Inc. v. Aero Alloy, 912 F.2d 1090,
1092 (9th Cir. 1990) (citing McNutt v. Gen. Motors
Acceptance Corp., 298 U.S. 178, 189 (1936)). A party who
brings a Rule 12(b)(1) challenge may do so by referring to
the face of the pleadings or by presenting extrinsic
evidence. See White v. Lee, 227 F.3d 1214, 1242 (9th
Cir. 2000) (“Rule 12(b)(1) jurisdictional attacks can
be either facial or factual . . . .”). In the former,
the challenger asserts that the allegations contained in a
complaint are insufficient on their face to establish federal
jurisdiction. Safe Air for Everyone v. Meyer, 373
F.3d 1035, 1039 (9th Cir. 2004). “By contrast, in a
factual attack, the challenger disputes the truth of the
allegations that, by themselves, would otherwise invoke
federal jurisdiction.” Id. In resolving a
factual attack on jurisdiction, the court need not presume
the truthfulness of the plaintiff's allegations, and may
review evidence beyond the complaint without converting the
motion to dismiss into a motion for summary judgment.
Rooker-Feldman Doctrine Does Not Apply
addressing the merits of Plaintiff's First Amended
Complaint, the Court must determine whether it has proper
subject matter jurisdiction. The Rooker-Feldman
doctrine provides that “a federal district court does
not have subject matter jurisdiction to hear a direct appeal
from the final judgment of a state court.” Noel v.
Hall, 341 F.3d 1148, 1154 (9th Cir. 2003) (citing
Feldman, 460 U.S. 462, 476 (1983)). Review of such state
court decisions may be conducted only by the United States
Supreme Court. Id.; see also 28 U.S.C.
doctrine bars a district court from exercising jurisdiction
not only over an action explicitly styled as a direct appeal,
but also over the ‘de facto equivalent' of such an
appeal.” Cooper v. Ramos, 704 F.3d 772, 777
(9th Cir. 2012) (internal citation omitted). A forbidden de
facto appeal is defined as a case “brought by [a]
state-court loser[] complaining of injuries caused by [a]
state-court judgment[] rendered before the district court
rejection of [that] judgment[].” Exxon Mobil Corp.
v. Saudi Basic Indust. Corp., 544 U.S. 280, 284 (2005).
To the extent that another part of the federal
plaintiff's suit is “inextricably
intertwined” with the forbidden de facto appeal, that
issue is also barred. Noel v. Hall, 341 F.3d 1148
(9th Cir. 2003); see also Maldonado v. Harris, 370
F.3d 945, 950 (9th Cir. 2004) (clarifying that the
“inextricably intertwined” test comes into play
only after the Court determines that some issue in the
complaint seeks an impermissible appeal of the state court
lawsuit does not fall within the narrow class of cases to
which Rooker-Feldman applies. First, although the
Complaint refers to perceived errors by the Idaho courts, it
does not seek to overturn or challenge those decisions. Nor
does ENA dispute that the amended contract was void. Second,
the legal wrong alleged is not an erroneous decision by the
state court, but rather the independent constitutional
violations of state actors. Specifically, Plaintiff
challenges: (1) Attorney General Wasden's demands for
repayment from ENA pursuant to Idaho Code § 67-9213; and
(2) Gwartney's unilateral amendments, which converted
ENA's agreement with the state into a void contract. Even
if the state court orders were valid, these actions may
amount to independent constitutional violations.
argue that ENA attempts to circumvent the jurisdictional bar
by seeking to enjoin enforcement of the Syringa II
judgment, thereby obtaining indirect federal review of the
state case. Def.'s Br. at 4. However, the Idaho
Supreme Court did not, as Defendants assert, “direct[]
the State . . . to recover the substantial funds . . .
advanced by the state to the vendors under the void
contracts.” Id. The Court expressly declined
to interpret the meaning of “advances” as used by
Idaho Code § 67-5725 (since re-codified at §
67-9213) or to issue such an order:
Section 67-5725 does impose an obligation on the proper
officer “of the state of Idaho” to seek repayment
of money advanced under the void SBPOs, if repayment is
refused or delayed. But it imposes no obligation on the
district court to preemptively order that DOA comply with
Syringa Networks, LLC v. Idaho Dep't of Admin.,
367 P.3d 208, 224-25 (2016) (emphasis added). For these
reasons, the Court concludes that the Rooker-Feldman
doctrine does not deprive the Court of jurisdiction to
consider ENA's claims.
Plaintiff Fails to State a Valid § 1983 Claim
&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We next
consider whether the Complaint sufficiently alleges a claim
under 42 U.S.C. &sect; 1983. Section 1983 provides a basis
for relief where the challenged action (1) occurred
&ldquo;under color of state law, &rdquo; and (2) resulted in
the deprivation of a constitutional or federal statutory
right. Leer v. Murphy, 844 F.2d 628, 632-33 (9th
Cir. 1988) (internal citations omitted). Defendants'
Motion challenges the second element: whether Gwartney and