Court Opinion

ID: 9411347
Source: CourtListenerOpinion
Date Created: 2023-07-26 17:00:49.940199+00
Date Added: 2024-06-11T17:21:06.297957
License: Public Domain

FOR PUBLICATION

   UNITED STATES COURT OF APPEALS
        FOR THE NINTH CIRCUIT

GEORGE JONES, an individual,                 No. 22-55489
                Plaintiff-Appellant,           D.C. No.
                                            2:21-cv-04547-
 v.
                                               MCS-GJS
L.A. CENTRAL PLAZA LLC, a
California limited liability company;
CENTRAL LIQUOR & MARKET,                      OPINION
INC., a California corporation; and
DOES, 1–10,
                Defendants-Appellees.

         Appeal from the United States District Court
            for the Central District of California
          Mark C. Scarsi, District Judge, Presiding
          Argued and Submitted December 7, 2022
                   Pasadena, California

                     Filed July 26, 2023

      Before: Milan D. Smith, Jr., Daniel P. Collins, and
              Kenneth K. Lee, Circuit Judges.

                  Opinion by Judge Collins
2               JONES V. L.A. CENTRAL PLAZA, LLC

                          SUMMARY *

        Americans with Disabilities Act / Standing

   The panel vacated the district court’s sua sponte
dismissal of George Jones’s action under the Americans with
Disabilities Act against L.A. Central Plaza LLC and Central
Liquor & Market, Inc., and remanded for further
proceedings.
    After Jones moved for summary judgment on the merits,
the district court instead sua sponte dismissed the case on the
ground that Jones’s amended complaint failed adequately to
plead the elements of Article III standing. Defendants’
opposition to Jones’s motion had argued, in the alternative,
that the case should be dismissed for lack of jurisdiction
because Jones failed adequately to show Article III standing.
In his reply, Jones had argued that he had sufficiently
established standing.
    The panel held that, because Jones had a full and fair
opportunity to prove his case as to standing, the district court
had discretion, in resolving Jones’s summary judgment
motion, to also consider sua sponte whether to grant
summary judgment against Jones on the issue of standing.
The panel held, however, that when presented with the issue
of standing in the context of Jones’s fully briefed summary
judgment motion, the district court could not ignore the
factual evidence of standing presented at summary judgment
and instead sua sponte examine the adequacy of the
complaint’s allegations of standing.

*
 This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
              JONES V. L.A. CENTRAL PLAZA, LLC             3

                        COUNSEL
Lauren R. Davis (argued) and Anoush Hakimi, The Law
Office of Hakimi & Shahriari, Los Angeles, California;
Cody Robert Cooper, Hakimi & Shahriari, Encino,
California; for Plaintiff-Appellant.
Stephen E. Abraham (argued), Law Offices of Stephen
Abraham, Newport Beach, California, for Defendant-
Appellee.

                        OPINION

COLLINS, Circuit Judge:

    Plaintiff-Appellant George Jones sued Defendants-
Appellees L.A. Central Plaza LLC and Central Liquor &
Market, Inc. for alleged violations of the Americans with
Disabilities Act (“ADA”). After Jones moved for summary
judgment on the merits, the district court instead sua sponte
dismissed the case on the ground that Jones’s amended
complaint had failed adequately to plead the elements of
Article III standing. Jones timely appealed the dismissal.
We vacate and remand for further proceedings.
                             I
    In his operative first amended complaint, Jones alleges
that he is disabled within the meaning of the ADA due to a
stroke-induced loss of function on the left side of his body.
He asserts that, on two occasions in early 2021, he visited
the “One Stop Liquor” shop on Central Avenue in Los
Angeles and encountered a variety of barriers to access that
4              JONES V. L.A. CENTRAL PLAZA, LLC

he contends violated the ADA. He seeks injunctive relief,
attorneys’ fees, and costs.
    In February 2022, Jones moved for summary judgment
on his ADA claim. As a plaintiff seeking summary
judgment, Jones had the obligation to establish that there was
“no genuine dispute as to any material fact” regarding his
Article III standing and that he was “entitled to judgment as
a matter of law.” FED. R. CIV. P. 56(a); see also Lujan v.
Defenders of Wildlife, 504 U.S. 555, 561 (1992).
Consequently, he “was on notice of the need to come
forward with all [his] evidence in support of this motion,”
including on the issue of standing, “and [he] had every
incentive to do so.” Nozzi v. Housing Auth. of L.A., 806 F.3d
1178, 1200 (9th Cir. 2016) (simplified) (quoting Albino v.
Baca, 747 F.3d 1162, 1177 (9th Cir. 2014) (en banc)).
Although Defendants did not file a formal cross-motion for
summary judgment, their opposition to Jones’s motion
specifically argued, in the alternative, that the case should be
dismissed for lack of jurisdiction because Jones had failed
adequately to show Article III standing. In his reply in
support of his summary judgment motion, Jones argued that
he had sufficiently established standing and that, indeed,
“there can be no genuine dispute that [he] has standing.”
Because Jones thus “had a full and fair opportunity to prove
[his] case” as to standing, the district court had discretion, in
resolving Jones’s summary judgment motion, to also
consider sua sponte whether to grant summary judgment
against Jones on the issue of standing. See Nozzi, 806 F.3d
at 1199 (citation omitted).
    But the district court declined to decide whether either
side was entitled to summary judgment on the issue of
standing. Instead, the district court sua sponte addressed
whether the allegations of Article III standing in Jones’s
                  JONES V. L.A. CENTRAL PLAZA, LLC                         5

operative complaint were sufficient to satisfy the applicable
pleading standards of Ashcroft v. Iqbal, 556 U.S. 662, 678–
79 (2009). See Winsor v. Sequoia Benefits & Ins. Servs.,
LLC, 62 F.4th 517, 523–25 (9th Cir. 2023) (noting that,
under Spokeo, Inc. v. Robins, 578 U.S. 330, 338 (2016), “[a]t
the pleading stage, plaintiffs must clearly allege facts
demonstrating each element” of Article III standing and that
the Iqbal pleading standards therefore apply in assessing the
facial adequacy of allegations of standing (simplified)); see
also Namisnak v. Uber Techs., Inc., 971 F.3d 1088, 1092
(9th Cir. 2020) (same). 1 Concluding that those allegations
were insufficient, the district court held that it “must dismiss
the first amended complaint.”
    Having done so, the court then sua sponte considered,
and denied, a hypothetical request by Jones for “leave to
amend his complaint.” Because the deadline to amend the
complaint under the court’s Rule 16 pretrial scheduling order
had long passed, the district court held that the stricter
standards of Rule 16, rather than the more permissive

1
  We have distinguished between “facial” and “factual” challenges to
jurisdictional allegations in a complaint. See Leite v. Crane Co., 749
F.3d 1117, 1121 (9th Cir. 2014). In a factual challenge, the moving party
“introduc[es] evidence outside the pleadings” and seeks to have the
existence of jurisdiction determined as a factual matter. Id. In a facial
challenge, by contrast, the moving party “accepts the truth of the
plaintiff’s allegations but asserts that they ‘are insufficient on their face
to invoke federal jurisdiction.’” Id. (citation omitted). “The district
court resolves a facial attack as it would a motion to dismiss under Rule
12(b)(6).” Id. As Winsor and Namisnak implicitly recognized in
applying Iqbal’s pleading standards in evaluating facial challenges to
standing allegations, our previous suggestion that Iqbal does not apply
in that context, see Maya v. Centex Corp., 658 F.3d 1060, 1067–68 (9th
Cir. 2011), is clearly irreconcilable with Spokeo. See Miller v. Gammie,
335 F.3d 889, 899–900 (9th Cir. 2003) (en banc). It is thus no longer
good law.
6              JONES V. L.A. CENTRAL PLAZA, LLC

standards of Rule 15, governed any amendment of the
complaint. See Coleman v. Quaker Oats Co., 232 F.3d 1271,
1294 (9th Cir. 2000). Concluding that those stricter
standards could not be met, the district court denied leave to
amend the complaint and dismissed the action without
prejudice. The court consequently denied Jones’s summary
judgment motion as moot.
                              II
    “We review district court decisions to dismiss for lack of
subject matter jurisdiction de novo.” Hacienda Valley
Mobile Ests. v. City of Morgan Hill, 353 F.3d 651, 654 (9th
Cir. 2003). The question in this case is whether, when
presented with the issue of standing in the context of a
plaintiff’s fully briefed summary judgment motion, a district
court may ignore the factual evidence of standing presented
at summary judgment and instead sua sponte examine the
adequacy of the complaint’s allegations of standing under
Iqbal. We hold that it cannot.
                               A
     “[T]o satisfy Article III’s standing requirements, a
plaintiff must show (1) it has suffered an ‘injury in fact’ that
is (a) concrete and particularized and (b) actual or imminent,
not conjectural or hypothetical; (2) the injury is fairly
traceable to the challenged action of the defendant; and (3) it
is likely, as opposed to merely speculative, that the injury
will be redressed by a favorable decision.” Friends of the
Earth, Inc. v. Laidlaw Env’t Servs. (TOC), Inc., 528 U.S.
167, 180–81 (2000). These elements “must be supported in
the same way as any other matter on which the plaintiff bears
the burden of proof, i.e., with the manner and degree of
evidence required at the successive stages of the litigation.”
Lujan, 504 U.S. at 561. Thus, at the pleadings stage, the
                  JONES V. L.A. CENTRAL PLAZA, LLC                         7

plaintiff must allege sufficient facts that, taken as true,
“demonstrat[e] each element” of Article III standing.
Spokeo, 578 U.S. at 338 (citation and internal quotation
marks omitted). If the plaintiff fails to do so, the complaint
is subject to dismissal at the outset either upon motion by the
defendant under Federal Rule of Civil Procedure 12(b)(1) or
upon the court’s own inquiry. See Ruhrgas AG v. Marathon
Oil Co., 526 U.S. 574, 583 (1999) (holding that, because
“[t]hey keep the federal courts within the bounds the
Constitution and Congress have prescribed,” questions
concerning subject matter jurisdiction “must be policed by
the courts on their own initiative even at the highest level”);
see also FED. R. CIV. P. 12(h)(3) (“If the court determines at
any time that it lacks subject-matter jurisdiction, the court
must dismiss the action.”). 2

2
  As we have noted, see supra note 1, a defendant in an appropriate case
may instead assert, at the outset, “a factual attack on subject matter
jurisdiction in its motion to dismiss” under Rule 12(b)(1). San Diego
Cnty. Credit Union v. Citizens Equity First Credit Union, 65 F.4th 1012,
1029 (9th Cir. 2023) (emphasis added) (citation and internal quotation
marks omitted). “Where the jurisdictional issue is separable from the
merits of the case,” a court presented with such a factually-based motion
to dismiss “may consider the evidence presented with respect to the
jurisdictional issue and rule on that issue, resolving factual disputes if
necessary.” Id. at 1028 (quoting Thornhill Publ’g Co. v. GTE Corp., 594
F.2d 730, 733 (9th Cir. 1979)). However, resolving an Article III
standing issue under the guise of a Rule 12(b)(1) motion, rather than a
summary judgment motion under Rule 56, may be inappropriate if those
jurisdictional issues are “intertwined with the merits.” See Wood v. City
of San Diego, 678 F.3d 1075, 1083–84 (9th Cir. 2012) (noting the
plaintiffs’ “substantial arguments” that reliance on Rule 12(b)(1) is
improper in such a context, but finding it unnecessary to resolve the
issue); cf. also Gerlinger v. Amazon.com Inc., 526 F.3d 1253, 1255–56
(9th Cir. 2008) (addressing an issue of Article III injury, which was
intertwined with the merits of plaintiff’s alleged antitrust violation, under
summary judgment standards).
8              JONES V. L.A. CENTRAL PLAZA, LLC

    If the complaint’s factual allegations of Article III
standing are found to be adequate under Iqbal or are not
challenged at the outset by either the parties or the court, then
“the case advances to discovery for the parties to marshal
evidence supporting their claims and defenses.” Dupree v.
Younger, 598 U.S. 729, 731 (2023). “During or after that
process, either party can move for summary judgment under
Rule 56, which requires a district court to enter judgment on
a claim or defense if there is ‘no genuine dispute as to any
material fact and the movant is entitled to judgment as a
matter of law.’” Id. (quoting FED. R. CIV. P. 56(a)).
Because, as noted earlier, the elements of Article III standing
must be substantiated “with the manner and degree of
evidence required at the successive stages of the litigation,”
Lujan, 504 U.S. at 561, it follows that, “at the summary
judgment stage, a plaintiff must offer evidence and specific
facts demonstrating each element” of Article III standing.
Center for Biological Diversity v. Export-Import Bank, 894
F.3d 1005, 1012 (9th Cir. 2018). Likewise, when confronted
with a district court’s sua sponte “post-pleading stage order
to establish Article III standing, a plaintiff can no longer rest
on ‘mere allegations’ but must set forth by affidavit or other
admissible evidence ‘specific facts’ as delineated in Federal
Rule of Civil Procedure 56(e) as to the existence of such
standing.” Gerlinger v. Amazon.com Inc., 526 F.3d 1253,
1256 (9th Cir. 2008) (quoting Lujan, 504 U.S. at 561).
    Here, the parties presented the issue of Article III
standing to the court in the context of a summary judgment
motion, and they based their arguments on the evidentiary
materials in the summary judgment record. However, rather
than resolve the question actually presented by the parties as
to whether Jones had adequately established standing with
factual evidence under summary judgment standards, the
               JONES V. L.A. CENTRAL PLAZA, LLC              9

district court sua sponte decided to examine the adequacy of
the complaint’s allegations of Article III standing under
Iqbal’s pleading standards. For the reasons we explain in the
next section, the district court erred.
                              B
    In our adversary system, it is generally up to the parties
to decide, within the parameters of the applicable procedural
rules, what particular relief they wish to seek, what type of
motion they wish to present to obtain that relief, and which
arguments they wish to make in support. See United States
v. Sineneng-Smith, 140 S. Ct. 1575, 1579, 1581–82 (2020);
Greenlaw v. United States, 554 U.S. 237, 243–44 (2008).
There are, however, several respects in which the Federal
Rules allow the district court, with appropriate notice, to
raise issues sua sponte and even to convert the form of the
motion that a party has chosen to present to the court. For
example, as already noted, a jurisdictional issue such as
Article III standing may be raised sua sponte by the court at
any time. See FED. R. CIV. P. 12(h)(3). In addition, “[a]fter
giving notice and a reasonable time to respond,” a court may
“grant summary judgment for a nonmovant”; grant a
summary judgment motion “on grounds not raised by a
party”; or even ask the parties, in the absence of a motion, to
address the propriety of granting summary judgment on
grounds “identif[ied]” by the court. FED. R. CIV. P. 56(f)(1)–
(3). Moreover, when presented with “matters outside the
pleadings” in connection with a motion to dismiss for failure
to state a claim under Rule 12(b)(6) or for judgment on the
pleadings under Rule 12(c), the district court may choose to
exclude such extrinsic matters and address the motion under
the applicable Rule 12 standards, or it may convert the
motion into “one for summary judgment under Rule 56.”
See FED. R. CIV. P. 12(d) (noting that, if the court converts
10             JONES V. L.A. CENTRAL PLAZA, LLC

the motion to a summary judgment motion, the court must
afford all parties “a reasonable opportunity to present all the
material that is pertinent to the motion”).
    But unlike a situation in which a party’s motion under
Rule 12 is converted into a summary judgment motion, see
FED. R. CIV. P. 12(d), here the district court effectively did
the converse: the court converted a summary judgment
motion addressed to the adequacy of the evidence of
standing into a motion to dismiss addressed to the adequacy
of the complaint’s allegations of standing. As the First
Circuit has noted in confronting an analogous situation, “the
Federal Rules of Civil Procedure offer no support for a
conversion such as was undertaken by the district court.”
Ríos-Campbell v. U.S. Dep’t of Commerce, 927 F.3d 21, 25
(1st Cir. 2019) (rejecting a district court’s comparable sua
sponte conversion of a summary judgment motion into a
Rule 12(b)(6) motion examining the adequacy of the
complaint’s allegations under Iqbal). And we further agree
with the First Circuit that, “in the mine-run of cases,” such a
“reverse conversion of a summary judgment motion into a
motion to dismiss” is improper. Id. at 25, 26.
    In contrast to the conversion of a pleadings motion into
a summary judgment motion, a conversion the other way
will rarely (if ever) help to “secure the just, speedy, and
inexpensive determination” of the action. FED. R. CIV. P. 1.
The former type of procedural conversion allows for a
prompt and efficient means of achieving a definitive
resolution of a case-dispositive issue based on an evidentiary
record that is focused on, and adequate for, that specific
purpose. See 5C CHARLES ALAN WRIGHT & ARTHUR R.
MILLER, FEDERAL PRACTICE AND PROCEDURE § 1366, p.165
(3d ed. 2004) (stating that whether to exercise the discretion
to convert a Rule 12(b)(6) motion into a summary judgment
               JONES V. L.A. CENTRAL PLAZA, LLC             11

motion generally turns on whether doing so “is likely to
facilitate the disposition of the action” on the merits). By
contrast, the sort of reverse conversion employed by the
district court here contravenes “principles of sound case
management” in multiple respects. Ríos-Campbell, 927
F.3d at 25. By disregarding the more robust procedural
device the parties have invoked to frame the issue, such a
reverse conversion unjustifiably ignores the fuller
evidentiary record assembled by the parties after they have
already incurred the expense of discovery. For similar
reasons, one of the chief objectives of the Iqbal pleading
standards—which is to avoid “unlock[ing] the doors of
discovery for a plaintiff armed with nothing more than
conclusions,” Iqbal, 556 U.S. at 678–79—is largely
inapposite by the time of summary judgment. See Ríos-
Campbell, 927 F.3d at 24 (stating that, after “substantial
discovery has taken place” and the parties have filed
summary judgment motions, “the plausibility standard [of
Iqbal] normally becomes a relic of a bygone time”).
    The potential for thwarting an efficient and just
determination of the action is all the more apparent if one
considers the practical effect of such a reverse conversion on
the outcome of the motion presented. Suppose, for example,
that the factual record presented at summary judgment
confirms that the defendant is entitled to judgment as a
matter of law on the issue of standing. Under those
circumstances, deciding the summary judgment motion as
presented would yield the same result as a retrogressive
faulting of the complaint’s factual allegations of standing,
and so nothing is accomplished by declining to honor the
parties’ choice of the procedural vehicle of summary
judgment. But suppose that the summary judgment record
shows instead that the plaintiff has raised sufficient evidence
12             JONES V. L.A. CENTRAL PLAZA, LLC

of standing to allow—or even to compel—a trier of fact to
find in its favor on standing. In that situation, dismissing the
case based on Iqbal-based pleading deficiencies in the
complaint’s factual allegations would change the outcome in
a way that seems difficult to justify. In that scenario, the
fruits of the litigation process would have revealed that the
pleading deficiency is curable: because the actual facts
developed by the parties show that the plaintiff has enough
proof to proceed, that evidence would provide a roadmap for
curing any overlooked Iqbal deficiency in the complaint’s
factual allegations. What possible justification could there
be, in such circumstances, for raising a purely technical
pleading deficiency that the defendant never saw fit to raise?
Had the defendant challenged the adequacy of those factual
allegations by a timely motion under Rule 12, those
deficiencies presumably could have been cured before the
allotted time to amend the pleadings expired. For a district
court to ignore the parties’ factual presentation on summary
judgment, and to instead insist on raising sua sponte an
unobjected-to-but-potentially-curable deficiency only after
the time to amend has expired, seems hardly to promote the
just determination of the action.
    Accordingly, a district’s court’s sua sponte conversion
of a summary judgment motion addressing sufficiency of the
evidence into a pleadings motion addressing the adequacy of
the complaint’s factual allegations under Iqbal either (1)
does not change the ultimate outcome or (2) changes it in a
way that seems exceedingly difficult to justify. Either way,
it makes little sense not to simply decide the issues as the
parties presented them.
   Such a reverse conversion of a summary judgment
motion into a pleadings motion is even more problematic
when, as here, the district court provided no notice to the
               JONES V. L.A. CENTRAL PLAZA, LLC             13

parties that it was contemplating doing so. Given the due
process and fairness concerns presented, a district court
generally must provide the parties with adequate notice that
it is contemplating invoking a particular procedural device
sua sponte. For example, we have held that a district court
generally may not sua sponte dismiss a complaint under
Rule 12(b)(6) unless it first “give[s] notice of its sua sponte
intention to invoke Rule 12(b)(6) and afford[s] plaintiffs ‘an
opportunity to at least submit a written memorandum in
opposition to such motion.’” Wong v. Bell, 642 F.2d 359,
361–62 (9th Cir. 1981) (citation omitted). And, as we have
explained, see supra at 9–10, the Federal Rules expressly
require that, if a pleadings motion is converted into a
summary judgment motion, the district court must afford all
parties a “reasonable opportunity to present all the material
that is pertinent to the motion.” FED. R. CIV. P. 12(d); see
also Hamilton Materials, Inc. v. Dow Chem. Corp., 494 F.3d
1203, 1207 (9th Cir. 2007) (stating that parties must “ha[ve]
notice” that the district court may “convert the motion to one
for summary judgment”). Given that the sort of reverse
conversion at issue here and in Ríos-Campbell is even more
atypical and unforeseeable, we perceive no justification for
applying a different rule and dispensing with advance notice
in that context.
    Further, the fact that the district court has the power and
the obligation to raise jurisdictional issues such as standing
sua sponte, see FED. R. CIV. P. 12(h)(3), does not mean that
it has discretion, later in the litigation, to retroactively
examine the adequacy of the complaint’s factual allegations
of standing under Iqbal. Indeed, we expressly noted in
Gerlinger that when a court issues a “post-pleading stage
order to establish Article III standing,” the applicable
standards are presumptively those governing summary
14             JONES V. L.A. CENTRAL PLAZA, LLC

judgment motions rather than those governing motions to
dismiss. Gerlinger, 526 F.3d at 1256.
    In short, when the parties have “briefed and argued
summary judgment, . . . judicial efficiency [is] best served
by dealing directly with those arguments rather than
avoiding them.” Ríos-Campbell, 927 F.3d at 25. In the
ordinary case, there is “no justification for allowing a district
court to travel back in time and train the lens of its inquiry
on the bare allegations of the complaint while disregarding
the compiled factual record upon which a summary
judgment movant has elected to rely.” Id. at 26.
    Nothing about the specific circumstances of this case
warrants departing from these general principles. If
anything, the record confirms the impropriety of the district
court’s manner of proceeding. In its ruling, the district court
itself opined that Jones had “provided facts that could
demonstrate standing with his motion for summary
judgment,” but it nonetheless inexplicably chose to ignore
those facts and instead to parse the language of Jones’s
complaint for compliance with Iqbal. And the court
provided no notice whatsoever that it planned to dispose of
the case in this novel and unjustifiable manner.
    Given the district court’s fundamental procedural errors,
we vacate the district court’s order dismissing this action and
remand the matter for further proceedings consistent with
this opinion. In view of our disposition, we need not and do
not address the remaining issues raised by the parties on
appeal.
     VACATED and REMANDED.