Court Opinion

ID: 4879294
Source: CourtListenerOpinion
Date Created: 2021-08-27 00:03:26.635419+00
Date Added: 2024-06-11T08:12:39.494170
License: Public Domain

Case: 21-20009     Document: 00515996657         Page: 1     Date Filed: 08/26/2021

              United States Court of Appeals
                   for the Fifth Circuit
                                                                       United States Court of Appeals
                                                                                Fifth Circuit

                                                                              FILED
                                                                        August 26, 2021
                                  No. 21-20009                           Lyle W. Cayce
                                                                              Clerk

   Spec’s Family Partners, Limited,

                                                           Plaintiff—Appellant,

                                       versus

   Dexter K. Jones; Emily E. Helm; Judith L. Kennison;
   Matthew Edward Cherry,

                                                         Defendants—Appellees.

                  Appeal from the United States District Court
                      for the Southern District of Texas
                              No. 4:18-CV-2670

   Before Stewart, Ho, and Engelhardt, Circuit Judges.
   Per Curiam:*
          Spec’s Family Partners, Limited (“Spec’s”) appeals from the
   district’s court dismissal of its 42 U.S.C. § 1983 suit against the Texas
   Alcoholic Beverage Commission (“TABC”) for failure to state a claim. We

          *
            Pursuant to 5th Circuit Rule 47.5, the court has determined that this
   opinion should not be published and is not precedent except under the limited
   circumstances set forth in 5th Circuit Rule 47.5.4.
Case: 21-20009      Document: 00515996657           Page: 2   Date Filed: 08/26/2021

                                     No. 21-20009

   must decide whether the district court correctly concluded that qualified
   immunity required dismissal of Spec’s’ claim. We affirm.
                                          I.
          This case, now before us on appeal for the second time, arises out of
   an investigation and administrative proceedings initiated by the TABC
   against Spec’s. The facts and procedural history are thoroughly laid out in
   our previous decision, so we confine our discussion to what is relevant to this
   appeal. See Spec’s Family Partners, Ltd. v. Nettles, 972 F.3d 671, 674–75 (5th
   Cir. 2020).
          During the investigation, Judith Kennison and “other representatives
   of the TABC” allegedly concealed documents from Kathy Anderson, a
   TABC auditor, to obtain testimony from her that Spec’s violated the Texas
   Alcoholic Beverage Code. Kennison allegedly knew the documents did not
   establish any violation of the Code. Spec’s asserts that the TABC used
   Anderson’s testimony as leverage to force Spec’s to settle and to supplement
   its allegations against Spec’s.
          During the administrative proceedings, a panel of administrative law
   judges resolved some of the TABC’s charges in favor of Spec’s as a matter
   of law, and the remainder went to a hearing. At the multi-day hearing, Spec’s
   cross-examined Anderson, who stated that her earlier testimony was
   incorrect. The panel sided with Spec’s on all but one of the charges, for
   which it recommended a warning.
          Relevant here, Spec’s then sued several TABC employees, including
   Kennison, Emily Helm, Dexter Jones, and Matthew Cherry (collectively
   “Defendants”) under 42 U.S.C. § 1983, the Sherman Act, and state law,
   seeking declaratory and injunctive relief.

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                                    No. 21-20009

          The district court dismissed all of Spec’s’ federal claims and declined
   to exercise supplemental jurisdiction over its state law malicious prosecution
   claims. We affirmed except as to Defendants’ claim that they are entitled to
   absolute immunity for actions taken during the investigation and before the
   administrative proceedings began. Spec’s, 972 F.3d at 680 & n.7. As to that
   claim, we held that Defendants were not acting in a prosecutorial capacity
   and therefore could not claim absolute immunity. Id. Thus, we remanded
   that issue. Accordingly, we also vacated the dismissal of Spec’s’ state law
   malicious prosecution claim on supplemental jurisdiction grounds. Id. at
   684.
          On remand, Defendants filed a new motion to dismiss based on
   qualified immunity. The district court determined that Spec’s failed to show
   a violation of its constitutional rights and accordingly granted the motion to
   dismiss. The court again declined jurisdiction over the state law claims.
   Spec’s timely appealed.
          We review de novo a district court’s dismissal under Federal Rule of
   Civil Procedure 12(b)(6). Sw. Bell Tel., LP v. City of Houston, 529 F.3d 257,
   260 (5th Cir. 2008). To survive a Rule 12(b)(6) motion to dismiss, Spec’s
   must plead “enough facts to state a claim to relief that is plausible on its
   face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). We “take the
   well-pleaded factual allegations in the complaint as true” but do “not credit
   conclusory allegations or allegations that merely restate the legal elements of
   a claim.” Chhim v. Univ. of Texas at Austin, 836 F.3d 467, 469 (5th Cir. 2016).
                                         II.
          Spec’s alleges that Defendants violated its Fourteenth Amendment
   due process rights when they allegedly concealed evidence during the
   investigatory phase of the TABC proceedings. Specifically, Spec’s argues
   that the district court erred by “declin[ing] to extend due process protections

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                                      No. 21-20009

   to an administrative case where there was a violation of Appellant’s
   constitutional rights.”
          Defendants assert qualified immunity. “When a defendant raises a
   qualified immunity defense, the plaintiff has the burden of demonstrating the
   inapplicability of that defense. To meet this burden, the plaintiff must show
   (1) that the official violated a statutory or constitutional right, and (2) that the
   right was clearly established at the time of the challenged conduct.” Turner
   v. Lieutenant Driver, 848 F.3d 678, 685 (5th Cir. 2017) (quotations omitted).
          Here, Spec’s fails to plead sufficient facts to state a claim that
   Defendants violated its constitutional rights.         “To state a Fourteenth
   Amendment due process claim under § 1983, a plaintiff must first identify a
   protected life, liberty or property interest and then prove that governmental
   action resulted in a deprivation of that interest.” Gentilello v. Rege, 627 F.3d
   540, 544 (5th Cir. 2010) (quotations omitted). For the purposes of this
   appeal, we assume that Spec’s has a protected property interest.
          To plead a procedural due process violation, Spec’s must plead
   sufficient facts to state a claim “that the deprivation of [its] property right
   occurred without due process of law.” Marco Outdoor Advert., Inc. v. Reg’l
   Trans. Auth., 489 F.3d 669, 672 (5th Cir. 2007). As the Supreme Court has
   made clear, “the fundamental requirement of due process is the opportunity
   to be heard ‘at a meaningful time and in a meaningful manner.’” Mathews v.
   Eldridge, 424 U.S. 319, 333 (1976) (quoting Armstrong v. Manzo, 380 U.S. 545,
   552 (1965)).
          Here, Spec’s’ own complaint indicates that it received both notice and
   an opportunity for a hearing before a panel of administrative law judges. The
   panel resolved some of the TABC’s charges in favor of Spec’s as a matter of
   law. The panel then conducted a multi-day evidentiary proceeding at which
   Spec’s was able to rebut the TABC’s charges. Specifically, Spec’s cross-

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                                    No. 21-20009

   examined Anderson and elicited a favorable admission that her previous
   testimony was incorrect. Ultimately, the panel ruled for Spec’s on all charges
   except one, for which it only issued a warning. Spec’s does not cite a single
   case that holds that the plaintiff can state a procedural due process
   deprivation sufficient to survive a motion to dismiss where the plaintiff had
   the opportunity to be heard in the administrative proceedings, cross-
   examined witnesses, and prevailed on all charges save for a warning.
          Thus, we conclude that Spec’s has failed to state a claim for a violation
   of a constitutional right. Because Spec’s has not pleaded a violation, we do
   not address the clearly established prong.
          Finally, a district court has discretion to decline supplemental
   jurisdiction over state law claims when it “has dismissed all claims over
   which it has original jurisdiction.” 28 U.S.C. § 1367(c)(3). We review a
   decision to decline supplemental jurisdiction for abuse of discretion. See
   Batiste v. Island Records, Inc., 179 F.3d 217, 226 (5th Cir. 1999). Because the
   district court correctly dismissed all of Spec’s’ federal law claims, it did not
   abuse its discretion in declining to exercise supplemental jurisdiction over
   Spec’s’ state law claims.
          Accordingly, we AFFIRM.

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