Pan v. City of Niagara Falls

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UNITED STATES DISTRICT COURT Sy NP

WESTERN DISTRICT OF NEW YORK | ( APR19 2023) Ci

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RAYMOND C. PAN, “SRN DISTRICLO=

Plaintiff,

Vv.

20-CV-1896 (JLS)

CITY OF NIAGARA FALLS, COUNTY

OF NIAGARA, STATE OF NEW YORK,

NIAGARA FALLS WATER BOARD,

NELNET,

Defendants.

DECISION AND ORDER

Pro se plaintiff Raymond Pan filed an amended complaint against Defendants

City of Niagara Falls, County of Niagara, State of New York, Niagara Falls Water

Board, and Nelnet. Dkt. 19. He asserts negligence claims and claims under Section

1983—alleging that Defendants violated his constitutional rights. Dkt. 19, at 1.

The Court previously granted Pan permission to proceed in forma pauperis—that is,

without paying the filing fee. Dkt. 6. Therefore, the Court now screens Pan’s

amended complaint pursuant to 28 U.S.C. §§ 1915(e)(2)(B) and 1915A(a). Because

the amended complaint fails to present any “colorable claim[s],” it must be

dismissed. See Benitez v. Wolff, 907 F.2d 1298, 1295 (2d Cir. 1990).

BACKGROUND

I. THE AMENDED COMPLAINT

According to Pan’s allegations, Defendants New York State, City of Niagara

Falls, County of Niagara, and Niagara County Water Board have continuously

violated his constitutional rights! and committed negligence “in about 200

incidents.” Dkt. 19, at 5. He alleges an Equal Protection violation against the City

of Niagara Falls. Id. According to Pan, in 2008, he noticed that Niagara Falls

assessed properties at 100% of market value. Id. He contacted Dominic Penale, the

City of Niagara Falls’ Assessor, to request that his properties also be assessed at

market value. Id. Penale told Pan to come to the assessment hearing in front of the

New York Board of Real Property Services. Jd. At the hearing, Penale lowered the

assessed values of “quite a few” white owners’ properties to between 38% to 50% of

their purchased price—even though they did not attend the hearing or “present the

appraisal to Penale to prove 38% to 50% of their purchased price is the market

value.” Jd. The assessed value for most properties owned by Pan, who is Asian

American, remained higher than 100% of the purchased price. Id.

In 2004, according to Pan, Penale secretly lowered the assessed value of a

white owner's property from $55,000 to $38,200. Id. at 8. To cover his wrongdoing,

Penale changed the official records to show the previous assessed value as $22,100,

rather than $55,000. Jd. Pan continued to attend the assessment hearings every

May, except for two or three years between 2010 and 2018. Jd. at 7. At these

hearings, Penale, and later his successor, had the option to stipulate to the assessed

value, but did not. Jd. Penale also alleges other complaints about the assessment

hearings, such as officials giving him only ten minutes to dispute all his properties,

1 Pan alleges violations of his Fifth, Eighth, and/or Fourteenth Amendment rights.

Dkt. 19, at 1. He also alleges that Defendants violated the Supremacy Clause. Id.

rather than ten minutes for each property. Id. At the assessment hearing in 2020,

the hearing officers asked Pan questions that they have not asked to white property

owners, such as whether he improved his properties. /d. at 11.

Pan then lists various grievances he has with the City of Niagara Falls’

property taxes. Pan claims that the City gave white owners grants, such that “the

annual property tax for Asian American Property Owners is 1,000 to 2,500 times

more” than that paid by white property owners. Id. at 44. He further alleges that

City of Niagara Falls officials “abused the city’s money ... and have abused millions

of dollars of the city’s tax money,” thus causing a large financial deficit. Jd. at 49.

Because of this financial deficit, city officials “have passed on the deficit, and

implemented the non-feasible property tax law.” Jd. at 50. Pan also alleges that

the Niagara Falls Water Board has “been committing price gouging” when

installing water meters for property owners. Id. at 47.

Pan seeks an assortment of relief. See Dkt. 19, at 55-58. He requests a court

order preventing the City of Niagara Falls and Niagara County from foreclosing his

properties, an order requiring New York State to set up a “fiscal control board” in

Niagara Falls, several orders requiring various changes in the City of Niagara Falls’

tax laws, and an order directing the FBI to investigate the allegations in his

complaint. Jd. at 55-57. Additionally, Pan seeks $7,136,000 in actual damages,

and $1,400,000,000 in punitive damages. Id. at 57. If he does not receive a

judgment in excess of his federal student loan debt, Pan also requests that the

Court “write off the total balance of [his] federal student loan.” Jd. at 58.

Il. LEGAL STANDARD

Section 1915 “provide[s] an efficient means by which a court can screen for

and dismiss legally insufficient claims.” Abbas v. Dixon, 480 F.3d 686, 639 (2d Cir.

2007) (citing Shakur v. Selsky, 391 F.8d 106, 112 (2d Cir. 2004)). A court shall

dismiss the complaint if it determines that the action (1) is frivolous, malicious, or

fails to state a claim upon which relief may be granted, or (2) seeks monetary relief

from a defendant who is immune from such relief. 28 U.S.C. § 1915A(b). A

complaint “is frivolous where it lacks an arguable basis either in law or in fact.”

Neitzke v. Williams, 490 U.S. 319, 325 (1989). As the Second Circuit has noted,

“[s]ua sponte dismissal of a pro se complaint prior to service of process is a

draconian device which is warranted only when the complaint lacks an arguable

basis either in law or in fact [or is] frivolous on its face or wholly insubstantial.”

Benitez, 907 F.2d at 1295 (citations omitted).

Generally, courts will afford a pro se plaintiff an opportunity to amend or to

be heard prior to dismissal “unless the court can rule out any possibility, however

unlikely it might be, that an amended complaint would succeed in stating a claim.”

Abbas, 480 F.3d at 639 Gnternal quotation marks omitted). But leave to amend

pleadings may be denied when any amendment would be futile. See Cuoco v.

Moritsugu, 222 F.3d 99, 112 (2d Cir. 2000).

DISCUSSION

I. THE ELEVENTH AMENDMENT BARS PAN’S CLAIMS AGAINST

NEW YORK STATE

The Eleventh Amendment “precludes suits against states and their agencies

unless the state expressly waives its immunity or Congress abrogates that

immunity.” Hahn v. New York, 825 F. App’x 538, 54 (2d Cir. 2020) (citations

omitted); see Gollomp v. Spitzer, 568 F.3d 355, 366 (2d Cir. 2009). New York has

not waived its immunity from Section 1983 claims in federal court. See Mamot v.

Bd. of Regents, 367 F. App’x 191, 192 (2d Cir. 2010) (“It is well-established that New

York has not consented to § 1983 suits in federal court.”) (citing Trotman v.

Palisades Interstate Park Comm'n, 557 F.2d 35, 38-40 (2d Cir. 1977)). Nor

has Congress abrogated state immunity for claims under Section 1983. See, e.g.,

Dube v. State Univ. of N.Y., 900 F.2d 587, 594 (2d Cir. 1990) (citing Quern v.

Jordan, 440 U.S. 332, 340-42 (1979)). Therefore, Pan’s claims against New York

State are barred by the Eleventh Amendment and must be dismissed.? See 28

U.S.C. § 1915(e)(2); Walker v. NYS Just. Ctr. for Prot. of People with Special Needs,

493 F. Supp. 3d 239, 246 (S.D.N.Y. 2020) (“A claim that is barred by a state’s

2 Although not named as Defendants in this suit, if Pan intended to bring claims

against any New York State agencies, such as the New York Board of Real Property

Services, the Eleventh Amendment bars those claims as well. See Walker v. City of

Waterbury, 253 F. App’x 58, 60 (2d Cir. 2007) (“The Eleventh Amendment entitles

states to sovereign immunity, and this immunity extends... to entities considered

arms of the state such as state agencies.”) (internal citations and quotation marks

omitted).

sovereign immunity must be dismissed pursuant to the Eleventh Amendment for

lack of subject matter jurisdiction.”).

Il. THE COURT LACKS JURISDICTION OVER PAN’S STATE-LAW

NEGLIGENCE CLAIMS

Pan also alleges state-law negligence claims against the municipal

Defendants. Under New York law, a notice of claim is a condition precedent to

bring a tort action against a municipality. See N.Y. Gen. Mun. Law § 50-e (“In any

case founded upon tort” against a municipality, a notice of claim shall be served

“within [90] days after the claim arises.”). Notice of claim requirements “are

construed strictly by New York state courts.” Hardy v. New York City Health &

Hosp. Corp., 164 F.3d 789, 793 (2d Cir. 1999) (citation omitted). Thus, failure to

comply with these requirements “ordinarily requires a dismissal for failure to state

a cause of action.” Id. at 794; see Greenland v. Municipality of Westchester Cnty.,

No. 18-CV-3157 (KMK), 2020 WL 4505507, at *6 (S.D.N.Y. Aug. 4, 2020) (“Federal

courts do not have jurisdiction to hear complaints from plaintiffs who have failed to

comply with the notice of claim requirement, or to grant permission to file a late

notice.”) (citation omitted).

Here, Pan does not allege that he served a notice of claim on any of the

municipal Defendants. See Dkt. 19. Accordingly, his state-law negligence claims

must be dismissed. See Allen v. Antal, 665 F. App’x 9, 14 (2d Cir. 2016) (dismissing

negligence claim against county employee where plaintiff failed to timely file notice

of claim); Greenland, 2020 WL 4505507, at *6 (“Because Plaintiff failed to

affirmatively plead that he filed a notice of claim with respect to any state law

claims, those claims are dismissed.”).

III. PAN’S SECTION 1983 CLAIMS MUST BE DISMISSED

Pan also alleges claims under Section 1983 against the City of Niagara Falls,

County of Niagara, and Niagara Falls Water Board. Dkt. 19, at 1. While the failure

to file a notice of claim precludes Pan’s state-law tort claims, it does not preclude his

Section 1983 claims against the municipal Defendants. See Hardy, 164 F.3d at 793

(stating the general rule that “in a federal court, state notice-of-claim statutes apply

to state-law claims”); Kearse v. Aini, No. 19-CV-6429-FPG, 2019 WL 3343409, at *4

(W.D.N.Y. July 25, 2019) (“New York’s notice of claim requirement is inapplicable to

Plaintiff's § 1988 claims, but is a condition precedent to any state-law claim she

may intend to bring.”). However, because the Tax Injunction Act and principles of

comity preclude this Court from granting the relief Pan seeks, his Section 1983

claims against the municipal Defendants must be dismissed.

A. Tax Injunction Act

The Tax Injunction Act prohibits federal courts from issuing injunctive or

declaratory relief in challenges to state tax laws if state remedies are adequate.

Kraebel v. New York City Dep’t of Hous. Pres. & Dev., 959 F.2d 395, 400 (2d Cir.

1992); 28 U.S.C. § 1841. Relatedly, the principle of comity “prevents a taxpayer

from seeking damages in a § 1983 action if a plain, adequate, and complete remedy

may be had in state court.” Bernard v. Vill. of Spring Valley, N.Y., 30 F.3d 294, 297

(2d Cir. 1994) (quoting Long Island Lighting Co. v. Town of Brookhaven, 889 F.2d

428, 431 (2d Cir. 1989) (LILCO”)); see Fair Assessment in Real Est. Ass’n, Ine. v.

McNary, 454 U.S. 100, 116 (1981) (holding the principle of comity bars taxpayers

from asserting § 1983 actions against the validity of state tax systems in federal

courts); Casciani v. Town of Webster, 501 F. App’x 77, 80 (2d Cir. 2012) (“Actions

under § 1983 seeking damages related to the collection of state taxes are barred by

the principle of comity so long as there is a procedurally adequate state alternative

procedure for challenging the assessment.”). Similarly, “comity precludes federal

jurisdiction over § 1983 challenges to a city’s administration of its fiscal programs.”

Bernard, 30 F.3d at 297.

There “is ‘no significant difference’ between the ‘plain, speedy and efficient’

standard set forth in the Tax Injunction Act and the ‘plain, adequate, and complete’

standard governing comity.” LILCO, 889 F.2d at 431 (quoting Fair Assessment, 454

U.S. at 116 n.8). A state remedy “is plain, speedy and efficient if it is procedurally

adequate.” LILCO, 889 F.2d at 431. “New York has procedurally adequate

mechanisms for challenging tax assessments....” Casciani, 501 F. App’x at 80; see

also Glob. Leadership Found. v. City of New York, No. 21CV10942 (DLC), 2022 WL

3701082, at *2 (S.D.N.Y. Aug. 26, 2022) (“The Second Circuit has found that New

York ‘provides several remedies’ permitting constitutional challenges to property

taxes, and that these remedies satisfy the TIA and comity doctrine’s procedural

requirements.”) (citing LILCO, 889 F.2d at 431); Miller v. State of New York Div. of

Tax Appeals, 480 F. Supp. 2d 574, 579 (E.D.N.Y. 2007) (“The Supreme Court has

determined that New York provides sufficient remedies for taxpayers in the state

courts.”) (citing Tully v. Griffin, Inc., 429 U.S. 68, 75 (1976)).

According to Pan, the City of Niagara Falls has abused millions of dollars in

taxpayer money—creating a significant financial deficit. Dkt. 19, at 49-53. Asa

result, City of Niagara Falls officials implemented “non-feasible property tax law to

the property owners.” Id. at 50. Thus, he seeks an order directing New York State

to set up a fiscal control board to stop city officials from abusing taxpayer dollars.

fd. at 51. Pan also seeks compensatory and punitive damages. Id. at 57. In

essence, Pan seeks orders from this Court directing the City to rewrite its tax code.

See id. at 55-57.

The Supreme Court “has interpreted the [Tax Injunction Act] as prohibiting

only those challenges to state tax schemes that would inhibit state collection of

taxes, as opposed to those that would increase taxes a state could collect.” Joseph v.

Hyman, 659 F.3d 215, 218 (2d Cir. 2011). Here, “the most obvious way to achieve

parity would be to reduce [Pan’s] tax lability’—which relief Pan apparently seeks,

in requesting compensatory damages. Levin v. Com. Energy, Inc., 560 U.S. 418, 429

(2010). The Tax Injunction Act prohibits the Court from issuing such relief. See id.

And Pan’s “more ambitious solution would reshape the relevant provisions of [the

City’s] tax code.” Seeid. In issuing such relief, the Court “would engage in the

very interference in state taxation the comity doctrine aims to avoid.” Jd. (citations

omitted).

Therefore, because “procedurally adequate state remedies, such as a § 1983

action in state court, are available to [Pan], his constitutional objections to the

[City’s] tax assessment should be lodged in state court, not federal court.” Bernard,

30 F.3d at 297. For these reasons, the Court lacks jurisdiction over Pan’s Section

1983 claims challenging his property assessments and the City’s tax administration

scheme.® See Terminello v. Vill. of Piermont, No. O08CVO1056WCCDCP, 2009 WL

3496615, at *2 (S.D.N.Y. Oct. 28, 2009) (holding that the Tax Injunction Act and

3 Even if the Tax Injunction Act and principles of comity did not deprive this Court

of jurisdiction over Pan’s Section 1983 claims, he still fails to state a claim. Most of

the events alleged in the amended complaint occurred outside the statute of

limitations. See Hogan v. Fischer, 738 F.3d 509, 517 (2d Cir. 2013) (“Section 1983

actions filed in New York are subject to a three-year statute of limitations.”), And

Pan’s apparent attempt to invoke the continuing violation doctrine is unavailing

because he fails to allege a continuous practice and policy of discrimination. See

Fahs Const. Grp., Inc. v. Gray, 725 F.3d 289, 292 (2d Cir. 2013) (“[W]here a plaintiff

challenges a continuous practice and policy of discrimination ... the commencement

of the statute of limitations period may be delayed until the last discriminatory act

in furtherance of it.”). To trigger this doctrine, “the plaintiff must allege both the

existence of an ongoing policy of discrimination and some non-time-barred acts

taken in furtherance of that policy.” Jd. Pan fails to allege an ongoing policy of

discrimination. To the extent he alleges that preferential treatment for white

property owners suffices, merely asserting a municipal custom or policy “is

insufficient in the absence of allegations of fact tending to support, at least

circumstantially, such an inference.” Montero v. City of Yonkers, New York, 890

F.3d 386, 403-04 (2d Cir. 2018) (internal quotation marks and citation omitted).

Similarly, Pan fails to establish that the municipal Defendants are subject to

lability. To hold a municipality liable in a Section 1983 action, “a plaintiff is

required to plead and prove three elements: (1) an official custom or policy that (2)

causes the plaintiff to be subjected to (8) a denial of a constitutional right.” Torraco

v. Port Auth, of N.Y. & N.J., 615 F.3d 129, 140 (2d Cir. 2010). Thus, Pan’s failure to

allege that an official policy or custom caused the alleged violations of his

constitutional rights is fatal to his Section 1983 claims against the municipal

Defendants.

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comity precluded the court from exercising jurisdiction over plaintiffs challenge to

real property assessment on equal protection and due process grounds).

IV. OTHER RELIEF

A. Request for FBI Investigation

Pan also requests that the Court order the FBI to investigate his claims.

Dkt. 19, at 57. This Court “may not compel the prosecuting authorities to

commence an investigation or prosecution.” Senior v. Univ. Towers Assocs., No. 08

CV 0387 (ENV), 2008 WL 649713, at *4 (E.D.N.Y. Mar. 10, 2008) (citing Fields v.

Soloff, 920 F.2d 1114, 1118 (2d Cir. 1990)). His request is therefore denied. See,

e.g., United States v. Bayon, No. 18-CR-163-FPG, 2022 WL 109351, at *1 (W.D.N.Y.

Jan. 12, 2022) (“Defendant also asks the Court to order the FBI to investigate

misconduct allegedly undertaken by personnel at his facility. The Court does not

have the authority to grant that relief.”); Perez v. Krugger, No. 12-CV-740F, 2015

WL 1472132, at *2 (W.D.N.Y. Mar. 31, 2015) (“Plaintiffs request that the court

direct the FBI to investigate his claims must also be DENIED as, absent a statute,

the court has no authority to do so.”).

B. Student Loans

In his amended complaint, Pan also names Nelnet as a defendant. Dkt. 19,

at 1. He requests “a court order to write off the total balance of [his] Federal

student loan.” Jd. at 58. Plaintiff does not put forth a basis for relief but, rather,

seeks such loan forgiveness in the event he is not awarded a judgment that covers

his outstanding student loans. Jd. To meet “the minimum constitutional

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requirements for standing, a plaintiff must allege an ‘actual or threatened injury’ to

himself that is ‘fairly traceable’ to the allegedly unlawful conduct of the defendant

and is ‘likely to be redressed by the requested relief.” Brody v. Vill. of Port Chester,

345 F.3d 103, 108-09 (2d Cir. 2003) (quoting Sullivan v. Syracuse Hous. Auth., 962

F.2d 1101, 1106 (2d Cir. 1992)). Pan does not allege that Nelnet engaged in any

unlawful conduct. See Dkt. 19, at 1. Rather, he alleges that the state and

municipal defendants violated his constitutional rights, resulting in financial

injury. Thus, because Pan’s claim against Nelnet “lacks any basis in law or

fact,” it must be dismissed. Benitez, 907 F.2d at 1295.

V. LEAVE TO AMEND

While district courts generally grant a pro se plaintiff an opportunity to

amend a complaint to cure its defects, leave to amend is not required where it would

be futile. See Hill v. Curcione, 657 F.3d 116, 123-24 (2d Cir. 2011). Here, any

amendment to Pan’s claims against the state of New York or its agencies would be

futile because the Eleventh Amendment bars such claims. See, e.g., Kelly v. New

York State Unified Ct. Sys., No. 21-1633, 2022 WL 1210665, at *3 (2d Cir. Apr. 25,

2022) (holding that amendment to plaintiffs claim would be futile because state

sovereign immunity barred his claim); Letzelter v. Annucci, No. 20-CV-630-LJV,

2021 WL 2903151, at *1 (W.D.N.Y. July 9, 2021) (“Because sovereign immunity

bars [Plaintiffs claim], that claim is dismissed without leave to amend because any

amendment would be ‘futile.””’).

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Similarly, because the Tax Injunction Act and principles of comity preclude

this Court from exercising jurisdiction over Pan’s Section 19838 claims against the

municipal Defendants, amendment would be futile. See Izzo v. City of Syracuse, No.

98-CV-0778 FJS GLS, 2000 WL 1222014, at *4 (N.D.N.Y. Aug. 3, 2000), aff'd, 11 F.

App’x 31 (2d Cir. 2001) (“[B]oth the Tax Injunction Act and principles of comity

require the dismissal of this claim, and renders futile the amendment of his

complaint in this regard.”). Even if Pan can demonstrate that he timely filed a

notice of claim, the Court declines to exercise supplemental jurisdiction over his

state-law negligence claims because all federal claims will be dismissed. See

Denney v. Deutsche Bank AG, 443 F.3d 253, 266 (2d Cir. 2006) (“A district court

usually should decline the exercise of supplemental jurisdiction when all federal

claims have been dismissed at the pleading stage.”). Further, amendment to Pan’s

claim against Nelnet would clearly be futile, as he fails to allege any cause of action.

See O’Neil v. Ponzi, 394 F. App’x 795, 796-97 (2d Cir. 2010) (“[W]here the substance

of the claim pleaded is frivolous on its face, § 1915(e) permits a district court to

dismiss the complaint swa sponte.”) (internal citation and quotation marks omitted).

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CONCLUSION

For these reasons, Pan’s amended complaint (Dkt. 19) is DISMISSED

pursuant to 28 U.S.C. §§ 1915(e)(2)(B) and 1915A. The Clerk of Court is directed to

close this case.

SO ORDERED.

/7

DATED: April & 2023

Buffalo, New York 3 Pe

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f — (

JOEBN L. SINATRA, JR.” rece

( UeNITED STATES DISTRICT II

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