Anderton v. Texas Parks & Wildlife Department

Case: 14-10297 Document: 00512982550 Page: 1 Date Filed: 03/26/2015

IN THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

No. 14-10297 United States Court of Appeals

Fifth Circuit

FILED

JAMES ANDERTON; JIMMIE ANDERTON, March 26, 2015

Lyle W. Cayce

Plaintiffs - Appellants Clerk

v.

TEXAS PARKS AND WILDLIFE DEPARTMENT; TEXAS ANIMAL

HEALTH COMMISSION; CARTER SMITH, Executive Director, Texas Parks

and Wildlife Department; CRAIG HUNTER, Director, Texas Parks and

Wildlife Department; L. DAVID SINCLAIR, Chief Game Warden, Texas

Parks and Wildlife Department; MITCH LOCKWOOD, Big Game Warden,

Texas Parks and Wildlife Department; DALE WATERS, Game Warden,

Texas Parks and Wildlife Department; GARY COLLINS, Game Warden,

Texas Parks and Wildlife Department; BRAD CHAPPELL, Investigator,

Texas Parks and Wildlife Department; AMBER ANDEL, Deer Breeders

Program, Texas Parks and Wildlife Department,

Defendants - Appellees

Appeal from the United States District Court

for the Northern District of Texas

No. 3:13-CV-01641

Before BENAVIDES, SOUTHWICK, and COSTA, Circuit Judges.

PER CURIAM:*

* Pursuant to 5TH CIR. R. 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

CIR. R. 47.5.4.

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Plaintiffs James and Jimmie Anderton appeal the district court’s

dismissal of Section 1983 and RICO claims brought against officials of the

Texas Parks & Wildlife Department (“the Department”). The Andertons also

claim the district court abused its discretion by failing to provide them an

opportunity to file an amended complaint. We AFFIRM.

FACTUAL AND PROCEDURAL BACKGROUND

From 2000 until 2010, the Andertons possessed a current permit issued

by the Department that authorized them to breed deer. Their breeding ranch

was located east of Dallas in Quinlan, Texas. In 2010, 2011, and 2012, the

Andertons submitted applications for renewal of the permit. The Department

denied those applications without explanation.

It has been alleged in this litigation that the Andertons’s permit was not

renewed because they had illegally imported deer from another state. The

Andertons had pled guilty, as shown in a federal court judgment of February

2, 2010, to the offense of conspiring to transport wildlife in interstate commerce

in violation of Texas law. The Andertons were charged under the general

federal conspiracy statute, 18 U.S.C. § 371. The substantive federal statutes

setting forth the offense were 16 U.S.C. §§ 3372(a)(2)(A) and 3373(d)(2). Those

are sections of what is called the Lacey Act. 16 U.S.C. §§ 3371-3378. The Texas

laws they were charged in an information with violating were 31 Texas

Administration Code Sections 65.609(b)(2), 65.611(h), and 65.611(i). The

Department may refuse permit issuance or renewal to any person convicted of

a violation of the Lacey Act. 31 TEX. ADMIN. CODE § 65.603(g)(2) (2010).

As mentioned above, the Andertons deer-breeding permit was not

renewed in 2010. Such a permit is valid from the date of issuance until the

immediately following July 1. 31 TEX. ADMIN. CODE 65.603(c). Apparently,

then, as of July 1, 2010, four months after their February convictions, they no

longer had a current permit to maintain breeder deer. On December 6, 2010,

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and May 1, 2011, Department officials entered and shot breeder deer on the

Andertons’ land. The Andertons allege the officials killed the deer in front of

their family and several witnesses.

In April 2013, the Andertons brought suit in the United States District

Court for the Northern District of Texas against the Texas Animal Health

Commission and the Department for violations of the Fourth, Fifth, and

Fourteenth Amendments, and the Racketeer Influenced and Corrupt

Organizations Act (“RICO”). They also sued several Department officials in

their official and individual capacities under 42 U.S.C. § 1983 and RICO.

Additionally, they brought claims for injunctive and declaratory relief against

all parties. The district court dismissed the Andertons’ Section 1983 and RICO

claims against the officials in their individual capacities under Federal Rule of

Civil Procedure 12(b)(6), and dismissed the remaining claims under Rule

12(b)(1). The Andertons appealed.

DISCUSSION

We review a dismissal under Rule 12(b)(6) de novo. Alabama-Coushatta

Tribe of Tex. v. United States, 757 F.3d 484, 487 (5th Cir. 2014) (citation

omitted). To survive a motion to dismiss, “a complaint must contain sufficient

factual matter, accepted as true, to ‘state a claim to relief that is plausible on

its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v.

Twombly, 550 U.S. 544, 570 (2007)). “A claim has facial plausibility when the

plaintiff pleads factual content that allows the court to draw the reasonable

inference that the defendant is liable for the misconduct alleged.” Id. (citing

Twombly, 550 U.S. at 556).

A claim under 42 U.S.C. Section 1983 requires that a plaintiff “(1) allege

a violation of a right secured by the Constitution or laws of the United States

and (2) demonstrate that the alleged deprivation was committed by a person

acting under color of state law.” Doe ex rel. Magee v. Covington Cnty. Sch. Dist.

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ex rel. Keys, 675 F.3d 849, 854 (5th Cir. 2012) (citation and quotation marks

omitted). Any rights the Andertons might have would arise from the Texas

statutes and regulations governing breeder-deer operations. One statute

provides that the “department shall issue a permit to a qualified person to

possess live breeder deer 1 in captivity.” TEX. PARKS & WILD. CODE § 43.352. 2

“[B]reeder deer may be held in captivity for propagation in [Texas] only after a

deer breeder’s permit is issued by the department[.]” Id. § 43.364. The permit

may be renewed annually, subject to certain requirements and exceptions. See

31 TEX. ADMIN. CODE § 65.603(d), (g).

The Andertons raise six issues on appeal, which we will analyze in the

following order:

1. The district court erred in dismissing their Fourth Amendment claims.

2. The district court erred in dismissing their substantive due process

claims.

3. The district court erred in dismissing their procedural due process

claims.

4. Alternatively, the district court abused its discretion by dismissing

their Section 1983 claims partially on grounds raised by the court sua

sponte without providing an opportunity to replead.

5. The district court abused its discretion by dismissing their RICO claim

based on pleading defects raised by the court sua sponte without

providing an opportunity to replead.

6. They stated cognizable claims against the defendants in their official

capacities for declaratory relief based on the defendants’ failure to renew

their deer breeder permit.

1 “‘Breeder deer’ means a white-tailed deer or mule deer legally held under a permit

authorized by this subchapter.” TEX. PARKS & WILD. CODE § 43.351(1).

2 All statutes and regulations referenced in the opinion are the versions that were in effect at

the time of the events in question.

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1. Fourth Amendment – Search and Seizure

The Andertons’ complaint alleges that the defendants engaged in both

an unconstitutional search of their property and an unconstitutional seizure –

the killing of the deer. The defendants did not obtain a warrant for either the

search or the seizure.

“Warrantless searches and seizures are per se unreasonable unless they

fall within a few narrowly defined exceptions.” United States v. McKinnon, 681

F.3d 203, 207 (5th Cir. 2012) (citation and quotation marks omitted). One such

exception is for a “closely regulated” industry. See New York v. Burger, 482

U.S. 691, 702 (1987). Under this exception,

a warrantless search of a pervasively regulated business is

permitted if: (1) there is a substantial government interest that

informs the regulatory scheme pursuant to which the inspection is

made; (2) the inspection is necessary to further the regulatory

scheme; and (3) the statutory or regulatory scheme provides a

constitutionally adequate substitute for a warrant.

United States v. Castelo, 415 F.3d 407, 409-10 (5th Cir. 2005) (citing Burger,

482 U.S. at 702-03).

The Andertons argue that the breeder-deer industry is not a closely

regulated industry. An industry is “closely regulated” where the “provisions

regulating the [industry] are extensive.” Burger, 482 U.S. at 704. The Court

found the operation of a junkyard to be closely regulated because the

regulations required the operator to “obtain[] a license,” “maintain [records],”

and “make such records . . . available for inspection[.]” Id. The operator was

also “subject to criminal penalties . . . for failure to comply with these

provisions.” Id. at 704-05.

As in Burger, under Department statutes and regulations a deer breeder

must obtain a permit, keep detailed records, and submit reports, and is subject

to inspection of facilities and records at any time. TEX. PARKS & WILD. CODE

§§ 43.358, 43.359, 43.364; 31 TEX. ADMIN. CODE § 65.608. Violation of the

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statutes or regulations may result in nonrenewal of a deer breeder’s permit

and criminal penalties. TEX. PARKS & WILD. CODE §§ 43.365, 43.367; 31 TEX.

ADMIN. CODE § 65.603. Accordingly, the provisions regulating the deer breeder

industry are sufficiently “extensive” to place that activity “squarely within the

class of industries to which Burger applies.” Castelo, 415 F.3d at 410 (citation

omitted); see also United States v. Fort, 248 F.3d 475, 480 (5th Cir. 2001)

(holding that where an industry is governed by “extensive” regulations, the

Burger principles apply).

The Andertons next argue that the deer-breeder statutes and regulations

are not an adequate substitute for a warrant. To provide a constitutionally

adequate substitute for a warrant, a regulatory scheme “must perform the two

basic functions of a warrant: it must advise the owner of the commercial

premises that the search is being made pursuant to the law and has a properly

defined scope, and it must limit the discretion of the inspecting officers.”

Burger, 482 U.S. at 703 (citations omitted). The statute or regulation must put

the owner on notice “that his property will be subject to periodic inspections

undertaken for specific purposes,” and “must be carefully limited in time, place,

and scope.” Id. (citations and quotation marks omitted).

We held a warrantless stop of a commercial trucker to be reasonable

under the closely regulated industry exception. See Castelo, 415 F.3d at 411.

The regulatory scheme was an adequate substitute for a warrant because the

statutes “provide[d] notice to commercial drivers that they may be subject to

random stops and inspections,” and the “scope of officer discretion” was

sufficiently limited as “only commercial vehicles may be stopped and

searched,” and only when “operating on a state highway . . . .” Id.

The statutes applicable to deer breeders provide notice that an

“authorized employee of the department may inspect at any time and without

warrant . . . any pen, coop, or enclosure holding . . . deer[.]” TEX. PARKS &

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WILD. CODE § 43.358(1). This statute satisfies the notice requirement. Even

where “statutes could have been more comprehensive and defined,” the notice

requirement is satisfied where they “permit an[] owner . . . to be aware that he

would be subject to warrantless” action. Fort, 248 F.3d at 482 (citing Burger,

482 U.S. at 703).

The statutes and regulations are also sufficiently limited in “time, place

and scope,” as they apply only to the breeder-deer industry; the officials may

inspect only a pen, coop, or enclosure holding breeder deer or records relating

to such enclosures; and the deer may be disposed of only after 30 days has

passed since the termination, revocation, or suspension of the deer breeder’s

permit. TEX. PARKS & WILD. CODE §§ 43.351, 43.358, 43.364; 31 TEX. ADMIN.

CODE § 65.612(c). It is true that Section 43.358 does not limit the time for

inspections. We agree with another panel of this court, though, that a statute

provides a constitutionally adequate substitute for a warrant where it was

limited in place and scope even if it permits inspections “as often as deemed

necessary.” Ellis v. Miss. Dept. of Health, 344 F. App’x 43, 45 (5th Cir. 2009)

(citation and quotation marks omitted).

Finally as to the closely regulated industry exception, the Andertons

claim Department officials exceeded the scope of the statutorily allowed

conduct under Club Retro L.L.C. v. Hilton, 568 F.3d 181 (5th Cir. 2009). In

Club Retro, forty deputy sheriffs, some “in full S.W.A.T. gear and black ski

masks,” went into the plaintiffs’ business with shotguns, assault rifles, and

pistols drawn. Id. at 191. Employees “thought that they were being robbed by

armed gunmen”; some were “thrown to the ground” and held “at gunpoint.” Id.

at 192. The deputies “searched every patron and employee” instructing some

women “to reach under their shirts, lift up their bras, and shake them so the

deputy sheriffs could see if any illegal drugs would fall out.” Id. The owners

of the club were “seized, assaulted, battered, and handcuffed” and “transported

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to a warehouse holding facility and held for over six hours.” Id. at 191. We

held that while the statutes “may have provided justification for an entry and

inspection of Club Retro,” they did not “permit[] the scope and manner of the

raid that plaintiffs allege occurred here.” Id. at 197.

There was no similarly excessive use of regulatory authority in the

present case. Department officials did what the statutes and regulations

authorized. They entered onto the Andertons’ property in order to dispose of

any breeder deer that remained on the land 30 days after expiration of the deer

breeder’s permit. Under the applicable closely regulated industry exception,

the warrantless search was not unconstitutional.

Once the Department officials were properly on the premises, their use

of their statutory authority to seize the deer was valid. The Fourth

Amendment generally prohibits warrantless seizures; however, the “plain

view” exception allows government officials to seize items where: “(1) the

[officials] lawfully entered the area where the item was located; (2) the item

was in plain view; (3) the incriminating nature of the item was ‘immediately

apparent;’ and (4) the [officials] had a lawful right of access to the item.”

United States v. Rodriguez, 601 F.3d 402, 407 (5th Cir. 2010) (quoting Horton

v. California, 496 U.S. 128, 136-37 (1990)).

The district court held the plain view doctrine applied to the warrantless

seizure of the deer because the deer were in plain view, the officials were acting

under constitutionally adequate state regulations when conducting the

inspection of the Andertons’ breeder deer, and the incriminating nature of the

deer was immediately apparent because the officials had probable cause to

believe the breeder deer were contraband. The Andertons argue the district

court’s holding was in error as it assumed facts not stated in the complaint.

It is true that the complaint contains few facts regarding the seizure. We

concluded above, consistent with the facts alleged in the complaint and the

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relevant law, that Department officials lawfully entered the Andertons’

property and had the right to kill the deer. The officials knew it had been more

than 30 days since the deer breeder’s permit had expired; thus, any deer

remaining on the Andertons’ land were there illegally. Lastly, the deer were

in plain view of the officials. Though the Andertons argue on appeal that many

deer “were obscured by tall grasses and trees,” the Department officials had

lawful access to the entire enclosure. Even if the deer were located in areas

obscured by tall grasses and trees, the officials were allowed to venture into

such areas and, once there, the deer would have been in plain view.

Because the requirements of the plain view doctrine are met, the

Andertons have failed to state a claim for violation of the Fourth Amendment

as to the warrantless seizure of the deer.

2. Fourteenth Amendment – Substantive Due Process

The Andertons also assert the defendants violated their substantive due

process rights by killing the deer. “To prevail on a substantive due process

claim, [a plaintiff] must first establish that it held a constitutionally protected

property right to which the Fourteenth Amendment’s due process protection

applies.” Simi Inv. Co., Inc. v. Harris Cnty., Tex., 236 F.3d 240, 249-50 (5th

Cir. 2000) (citations omitted). One recognized means of violating substantive

due process, and the one on which the plaintiffs rely, is for official conduct to

take life, liberty, or property in a manner that “shocks the conscience.” Conroe

Creosoting Co. v. Montgomery Cnty., Tex., 249 F.3d 337, 341 (5th Cir. 2001)

(citations omitted). The “burden to show state conduct that shocks the

conscience is extremely high, requiring stunning evidence of arbitrariness and

caprice that extends beyond mere violations of state law, even violations

resulting from bad faith to something more egregious and more extreme.” Doe,

675 F.3d at 868 (citation and quotation marks omitted). Official conduct

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“intended to injure in some way unjustifiable by any government interest,” is

the conduct “most likely to rise to the conscience-shocking level . . . .” Chavez

v. Martinez, 538 U.S. 760, 775 (2003) (citation and quotation marks omitted).

The Andertons argue the killing of the deer “shocks the conscience.”

Even if there were a protected property interest in the deer – an issue we will

analyze in the next section on procedural rights – Department officials were

acting pursuant to state law, not violating it. The Andertons failed to allege

facts that established the conduct of the officials was intended to injure them

unjustifiably. The district court stated that though the allegations “may raise

questions related to the most humane ways to kill deer, [they] do not plausibly

establish that the officials’ conduct was so egregious, so outrageous, that it may

fairly be said to shock the contemporary conscience.”

The Andertons have failed to demonstrate a violation of substantive due

process under the Fourteenth Amendment.

3. Fourteenth Amendment – Procedural Due Process

A claim brought under Section 1983 for violation of procedural due

process rights under the Fourteenth Amendment requires identification of a

protected life, liberty, or property interest and a sufficient allegation that there

was a deprivation of that interest by the government. See Gentilello v. Rege,

627 F.3d 540, 544 (5th Cir. 2010). State law is often the source of the benefit,

and the plaintiff must show a legitimate claim to an entitlement:

The procedural component of the Due Process Clause does not

protect everything that might be described as a “benefit”: To have

a property interest in a benefit, a person clearly must have more

than an abstract need or desire and more than a unilateral

expectation of it. He must, instead, have a legitimate claim of

entitlement to it. Such entitlements are, of course, not created by

the Constitution. Rather, they are created and their dimensions

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are defined by existing rules or understandings that stem from an

independent source such as state law.

Town of Castle Rock, Colo. v. Gonzales, 545 U.S. 748, 756 (2005) (citations,

alterations, and quotation marks omitted). “[I]f government officials may

grant or deny [the interest] in their discretion,” the interest is not protected by

due process. Id. (citation omitted). “In determining whether statutes and

regulations limit official discretion . . . we are to look for ‘explicitly mandatory

language,’ i.e., specific directives to the decisionmaker that if the regulations’

substantive predicates are present, a particular outcome must follow.’” Ridgely

v. FEMA, 512 F.3d 727, 735-36 (5th Cir. 2008) (quoting Ky. Dep’t of Corr. v.

Thompson, 490 U.S. 454, 463 (1989)).

We find there to be official discretion in the relevant regulations. The

most important of the regulations begins with an obligation on individuals like

the Andertons: “An applicant for an initial deer breeder’s permit shall submit

the following to the department,” and then lists five categories of information.

31 TEX. ADMIN. CODE § 65.603(a)(1)-(5). The language that follows for the

Department’s response to the application is not one of obligation: “A deer

breeder’s permit may be issued when” the application, other documents, and

fees have been received. Id. § 65.603(b). For renewals, the regulation also

omits mandatory language: “Except as provided in subsection (g) of this

section, a deer breeder’s permit may be renewed annually, provided that the

applicant” has submitted a timely renewal application, filed an annual report,

paid the renewal fee, and is then in compliance with the statutory subchapter.

Id. § 65.603(d). The provision just noted as an exception is also permissive:

“The department may refuse permit issuance or renewal to any person who

has been” convicted or otherwise been found guilty, even if only receiving a

deferred adjudication, of violation of certain offenses under the Parks and

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Wildlife Code. Id., § 65.603(g). In all these provisions, the Department is given

discretion to decide whether the particular application should be granted.

The only mandatory language cited to us by the Andertons concerns the

issuance of the initial permit, not a renewal: “The department shall issue a

permit to a qualified person . . . .” TEX. PARKS & WILD. CODE § 43.352(a).

For a constitutionally protected property right to be created, there must

be a clear entitlement to the governmental benefit. 3 We have held that

statutory language such as “may provide financial assistance” or “may provide

continued housing assistance” was permissive, not mandatory, and did not

create a protected property interest. Ridgely, 512 F.3d at 736 (citations

omitted).

The Department relies both on the seemingly permissive language of the

regulations and the fact that the mandatory statutory language applies only to

a “qualified person.” Because the Andertons were not qualified, the

Department argues, no process was constitutionally due before denial of a

renewal or a new permit. This argument assumes the Department could

independently determine the Andertons were not qualified, and that the

Andertons were not entitled to any process to attempt to prove they actually

were qualified. The Andertons argue they were qualified because they were

not convicted of violating the Lacey Act but of conspiracy to do so. Regardless

of the validity of that argument, the Andertons were not given the opportunity

to make the argument to the Department in a permit-renewal process.

We do not rely on the question of whether the Andertons were qualified.

Instead, we conclude that because the relevant statutes and regulations do not

3 In a bankruptcy case cited to us, the issue was whether the then-existing permit was

property of the estate; it was. In re Wheeler, 431 B.R. 158, 160 (N. D. Tex. 2005). The court

did not discuss whether a permit was a protected property interest for due process purposes.

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require the Department to renew a permit even when an applicant timely

seeks one and is qualified, the Andertons had no property right to a renewal.

The Andertons also claim that the killing of the deer was a procedural

due process violation because they had a protected property interest in the deer

herd. Under Texas law, though, breeder deer belong to the state, not the

permittee. See, e.g., TEX. PARKS & WILD. CODE §§ 1.011 (“All wild animals . . .

inside the borders of this state are the property of the people of this state.”);

43.364 (“All breeder deer . . . are under the full force of the laws of [Texas]

pertaining to deer . . . .”). While a permittee may have possession of the

breeder deer, the deer are only “held under a permit[.]” Id. § 43.351. Nowhere

do the statutes or regulations state that breeder deer become the property of a

permit holder. 4 Regardless, even if they did give ownership of breeder deer to

permit holders, the Andertons were not permit holders when the deer were

killed.

Because the Andertons cannot claim a constitutionally protected

property interest in the deer herd, their procedural due process claim as to the

killing of the deer fails.

4. & 5. Opportunity to Replead

The Andertons argue the district court erred in two important respects

when it made rulings without offering the Andertons an opportunity to

replead. As their fourth appellate issue, they argue that the district court

dismissed in part on grounds the court raised on its own, and that they could

4 The Andertons argue that deer are not wild animals and therefore not owned by the state,

citing Wiley v. Baker, 597 S.W.2d 3, 5 (Tex.App. – Tyler 1980, no writ). Although the court

stated a person may have “[u]nqualified property rights in wild animals” when they are

“made subjects of man’s dominion,” it did so in the context of a conversion case between two

private parties. See id. at 5. The court was not addressing whether a person holding deer

pursuant to a deer breeder’s permit takes ownership from the state.

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have responded to the judicially identified inadequacies by repleading. As their

fifth issue, the Andertons claim error in the dismissal of their RICO claim

without an opportunity to replead.

Where there is a denial by the district court of a motion for leave to

amend, we review the decision for abuse of discretion. United States ex rel.

Willard v. Humana Health Plan of Tex. Inc., 336 F.3d 375, 379 (5th Cir. 2003)

(citation omitted). Leave to amend should be “given when justice so requires,

and should be granted absent some justification for refusal.” Id. at 386

(citation and quotation marks omitted). Federal Rule of Civil Procedure 15(a)

applies “where plaintiffs expressly request[] to amend” their complaint, though

a “formal motion is not always required . . . .” Id. at 387 (citations and

quotation marks omitted). When a party does not ask the district court for

leave to amend, it is not for this court to grant the unstated request. Id.

The Andertons never asked the district court for leave to amend their

complaint. They contend the district court should have offered an opportunity

to replead because it dismissed their Section 1983 and RICO claims on

different grounds than those raised by the defendants. In a case cited to us by

the Andertons, we reversed the district court’s sua sponte dismissal of claims

that the defendants had not moved to dismiss. See Davoodi v. Austin Indep.

Sch. Dist., 755 F.3d 307, 310 (5th Cir. 2014). Here, the defendants moved for

dismissal of each claim the district court dismissed. The plaintiffs’ argument

is without merit.

6. Declaratory Relief

The Eleventh Amendment bars suits against state officials “if the State

is the real party in interest.” Raj v. La. State Univ., 714 F.3d 322, 328 (5th Cir.

2013) (citation and quotation marks omitted). The state is the real party in

interest when the court’s decision “would operate against the sovereign,

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expending itself on the public treasury, interfering with public administration,

or compelling the state to act or to refrain from acting.” Hughes v. Savell, 902

F.2d 376, 378 (5th Cir. 1990) (citing, among other cases, Pennhurst State Sch.

& Hosp. v. Halderman, 465 U.S. 89, 101 (1984)).

The Andertons argue they are entitled to pursue declaratory relief

against the Department officials in their official capacity to “establish that

Plaintiffs should have been issued a permit for possessing the breeder deer in

2010 and 2011 . . . and that they remain qualified persons entitled to a permit

. . . .” The state is the real party in interest as a decision in the Andertons’

favor would compel the Department itself to act. See id.; TEX. PARKS & WILD.

CODE § 43.352. Thus, the district court’s dismissal of the Andertons’ request

for declaratory relief was correct.

AFFIRMED.

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