BWW Inc v. Brigham

UNITED STATES DISTRICT COURT

NORTHERN DISTRICT OF ALABAMA

WESTERN DIVISION

BWW, Inc., d/b/a/

SERVPRO OF BIRMINGHAM,

Plaintiff,

v. Case No. 1:21-cv-470-CLM

JAMES BRIGHAM, et al.,

Defendants.

MEMORANDUM OPINION

BWW, Inc. d/b/a SERVPRO of Birmingham (“ServPro”) sued several

men associated with Jacksonville State University (“JSU”): President Don

C. Killingsworth, Senior Vice President for Finance and Administration

and Chief Financial Officer James Brigham, and Director of Capital

Planning and Facilities David Thompson (collectively, “JSU Defendants”).

(Doc. 1.) ServPro seeks injunctive relief, mandamus relief, and damages

from the JSU Defendants. The JSU Defendants have moved to dismiss.

(Docs. 8, 25.)

For the reasons below, the court will grant the JSU Defendants’

motion and (a) DISMISS WITH PREJUDICE ServPro’s claims for

prospective injunctive relief against the JSU Defendants in their official

capacities and ServPro’s § 1983 claims against Thompson and Brigham in

their individual capacities and (b) decline to exercise supplemental

jurisdiction over ServPro’s state law claims. So the court will DISMISS

WITHOUT PREJUDICE ServPro’s state law claims and its claims

against the fictitious defendants.

BACKGROUND

ServPro wants to get paid about $20 million for tornado recovery

work it did for JSU. ServPro seeks payment in two places: (1) this federal

court, where ServPro sued the individual JSU Defendants, and (2) the

Alabama Board of Adjustments, where ServPro filed a claim against JSU.

The court first explains how ServPro ended up in two places. The

court then decides whether ServPro can stay here.

A. Tornado Cleanup

An F3 tornado hit the main JSU campus in March 2018. It damaged

many buildings. To help clean up, Thompson (JSU’s Facilities director)

negotiated and executed the Disaster Recovery Authorization and Service

Contract (“Contract”) with ServPro for disaster recovery and restoration

services. The Contract set agreed-upon rates for different trades and skill

levels. Later, JSU and ServPro amended the Contract to say that skilled

laborers would perform all work at the appropriate rate.

Around April 2019, the State Insurance Fund stopped paying JSU

for ServPro’s work because of an audit that allegedly shows that ServPro

engaged in gross and fraudulent billing. So JSU stopped paying ServPro

in April 2019. JSU later learned that the FBI was also investigating

ServPro’s billing. (Doc. 1, Ex. B; see also doc. 1, ¶ 40.) But ServPro says

that Brigham (JSU’s CFO) affirmed JSU’s continuing obligation to pay

ServPro in August 2019. So ServPro kept working at JSU despite not

being paid.

Then, in December 2020, JSU sent a letter that told ServPro that

JSU would not make further payments until two things happened: (1) the

State of Alabama determined that ServPro’s charges were legitimate and

that the State Insurance Fund would reimburse JSU for ServPro’s

invoices; and (2) the FBI concluded its investigation into ServPro’s alleged

overbilling. (Doc. 1, Ex. B; doc. 1, ¶ 46.)

B. Federal Lawsuit

ServPro filed this lawsuit against the individual JSU Defendants—

not the University itself—a few months later. In it, ServPro alleges that

the individual JSU Defendants have violated the U.S. Constitution and

other federal laws, see 42 U.S.C. § 1983, and violated parts of Alabama

constitutional, statutory, and common law. ServPro asks for a mandatory

injunction that would force the JSU Defendants to force JSU to pay

ServPro and for compensatory and punitive damages.

The JSU Defendants moved to dismiss all claims against them.

(Doc. 8). Among many things1, the JSU Defendants argued that the

Alabama Board of Adjustment has exclusive jurisdiction over the

contractual dispute between JSU and ServPro, and this lawsuit was a

ruse to escape immunity problems and the Board resolving the dispute.

(Doc. 9 at 4-19). ServPro responded that the Board can only take cases if

sovereign immunity prevented the case being litigated in court. (Doc. 16

at 27-28). And because ServPro properly sued the individual JSU

Defendants here, the Board doesn’t have jurisdiction. (Id.)

C. The Alabama Board of Adjustment

Yet ServPro then filed a $20 million claim against JSU and other

state agencies with the Board of Adjustment. (Doc. 27 at 9-15). ServPro

told the Board about this federal case and said that it understood the

Board’s rules prevented the Board from ruling on its claim against JSU

until this court decides the case against the individual JSU Defendants.

(Id. at 9-11).

1 The court agrees with the JSU Defendants that ServPro’s Complaint is a shotgun

pleading that violates both the Federal Rules of Civil Procedure and Eleventh Circuit

precedent. FED. R. CIV. P. 8(a)(2); FED. R. CIV. P. 10(b); Jackson v. Bank of Am., N.A.,

898 F.3d 1348, 1356 (11th Cir. 2018); Weiland v. Palm Beach Cty. Sheriff’s Office, 792

F.3d 1313, 1321 (11th Cir. 2015). But the court will dismiss ServPro’s Complaint on

other grounds that promptly end this case, so the court needn’t give ServPro a chance

to remedy the pleading deficiencies. See Jackson, 898 F.3d at 1358–59.

STANDARD OF REVIEW

In considering the JSU Defendants’ Rule 12(b)(6) motion to dismiss,

the court accepts the factual allegations in ServPro’s Complaint as true

and construes them in the light most favorable to ServPro. Lanfear v.

Home Depot, Inc., 697 F.3d 1267, 1275 (11th Cir. 2012). A pleading must

contain “a short and plain statement of the claim showing that the pleader

is entitled to relief.” FED. R. CIV. P. 8(a)(2). Rule 8 does not require

“detailed factual allegations,” but does demand more than “an unadorned,

‘the-defendant-unlawfully-harmed-me’ accusation.” Ashcroft v. Iqbal, 556

U.S. 662, 678 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555

(2007)). A pleading that offers mere “labels and conclusions” or “a

formulaic recitation of the elements of a cause of action” is insufficient. Id.

The Complaint’s assertions must find support through further “factual

enhancement.” Id.

The ultimate question is whether ServPro’s allegations, when

accepted as true, “plausibly give rise to an entitlement of relief.” Id. at

678–79. If the facts as pleaded could entitle ServPro to relief, then the

court must deny the JSU Defendants’ motion to dismiss. If, however, the

court accepts ServPro’s pleaded facts as true, and ServPro still would not

be entitled to relief, then the court must grant the motion. The court will

consider the Complaint, ServPro’s notice that it filed a claim before the

Alabama State Board of Adjustment,2 the parties’ briefs on the motion to

dismiss, and the parties’ briefs on the supplement to the motion to

dismiss.

2 The court can consider an extrinsic document that is a public record—like ServPro’s

notice that it filed a claim before the Alabama State Board of Adjustment—in ruling on

motions to dismiss. See Universal Express, Inc. v. U.S. S.E.C., 177 F. App’x 52, 53 (11th

Cir. 2006) (“Public records are among the permissible facts that a district court may

consider.”).

DISCUSSION

The JSU Defendants seek dismissal on several grounds. Two of

them would dispose of the case without further proceedings:

• Option A: Rule that the Alabama Board of Adjustment

has exclusive jurisdiction over ServPro’s claim.

• Option B: Rule that ServPro has not, and cannot, plead a

viable claim against them under federal law and thus this

court lacks subject matter jurisdiction.

Option A would require this federal court to opine on state law issues like

the Board’s jurisdiction, § 14 of the Alabama Constitution, and state-agent

immunity. Option B focuses solely on federal issues. Principles of

federalism thus suggest the court avoid Option A if it can.

So that’s what the court does. As explained below, ServPro has not

pleaded viable claims under § 1983 against the JSU Defendants, and has

not given good reason to exercise supplemental jurisdiction over its state

law claims, so this court lacks jurisdiction.

I. ServPro fails to plead a viable federal claim.

The parties are not diverse, so ServPro relies on its pleading of a

federal question to give this court jurisdiction under 28 U.S.C. § 1331.

(Doc. 1, ¶ 1). The only federal claim in ServPro’s complaint is a violation

of 42 U.S.C. § 1983, which allows ServPro to sue state agents who violate

ServPro’s federal constitutional or statutory rights. (Doc. 1, ¶¶ 103-117).

ServPro alleges that the JSU Defendants violated three constitutional

provisions: the Takings Clause of the Fifth Amendment, the Due Process

Clause of the Fourteenth Amendment, and the Contracts Clause of Article

I, § 10 of the United States Constitution. (Id.). But before the court decides

whether any of ServPro’s federal claims are viable, the court must decide

whether the JSU Defendants are immune from them.

A. Immunity Issues

ServPro sued all three JSU Defendants in their official capacity,

and it sued Defendants Brigham and Thompson as individuals. The JSU

Defendants argue that they have sovereign immunity in their official

capacity and that Brigham and Thompson have qualified immunity from

suit as private individuals. The court addresses both arguments in turn.

1. Sovereign Immunity

The Eleventh Amendment bars lawsuits “against a state brought in

federal court by citizens of that state.” Harbert Int’l, Inc. v. James, 157

F.3d 1271, 1277 (11th Cir. 1998) (citing Hans v. Louisiana, 134 U.S. 1,

18–19 (1890)); U.S. CONST. amend. XI. This amendment also protects

“state officials sued in their official capacity.” Harbert Int’l, 157 F.3d at

1277 (citing Kentucky v. Graham, 473 U.S. 159, 166–67 (1985). But there

are exceptions to Eleventh Amendment sovereign immunity:

(1) when a state waives its Eleventh Amendment sovereign

immunity and consents to suit in federal court, (2) when

Congress, acting pursuant to § 5 of the Fourteenth

Amendment, abrogates a state’s Eleventh Amendment

sovereign immunity by expressing an unequivocal intent to do

so, and (3) when a state official is sued for prospective

injunctive relief to end a continuing violation of federal law.

Harbert Int’l, 157 F.3d at 1278 (internal citations removed).

Both parties rely on this language from Harbert Int’l. The JSU

Defendants argue that ServPro’s equitable claims are barred by sovereign

immunity because the claims are really claims against the State. (Doc. 9,

p. 19.) ServPro responds that: (1) it has not sued the State here—the claim

against the State (JSU) is now before the Board of Adjustment—and (2)

its claims against the JSU Defendants in their official capacities are

exempt from the sovereign immunity bar under the prospective-

injunctive-relief exception because ServPro is seeking equitable relief to

prevent ongoing unconstitutional violations of the Fifth Amendment,

Fourteenth Amendment, and Article I § 10 of the Constitution of the

United States.

And both parties are right, at least somewhat. The JSU Defendants

are right that ServPro’s claims against them are really against the State

because the injunction that ServPro seeks would ultimately require the

State (JSU)—not the individual JSU employees—to pay ServPro. See

Harbert Int’l, 157 F.3d at 1278. But at least on its face, ServPro’s

requested injunctive relief fits within the exception for “prospective

injunctive relief to end a continuing violation of federal law.” Id. So the

court finds that, at this pleading stage, sovereign immunity does not bar

ServPro’s claim for injunctive relief against the JSU Defendants in their

official capacities.

2. Qualified Immunity

Qualified immunity protects government officials from being sued

in their individual capacities so long as “their conduct ‘does not violate

clearly established statutory or constitutional rights of which a reasonable

person would have known.’” Vineyard v. Wilson, 311 F.3d 1340, 1346 (11th

Cir. 2002) (quoting Harlow v. Fitzgerald, 457 U.S. 800, 818 (1982)). The

Eleventh Circuit applies a two-part test to determine whether a

government official is entitled to the defense of qualified immunity. “First,

the official must prove that the allegedly unconstitutional conduct

occurred while he was acting within the scope of his discretionary

authority. Second, if the official meets that burden, the plaintiff must

prove that the official’s conduct violated clearly established law.” Harbert

Int’l, 157 F.3d at 1281 (citations omitted).

Brigham and Thompson both claim to have acted within their

discretionary authority when they entered contracts, sought

reimbursements, processed invoices, and decided on paying contractors.

The court agrees. So ServPro must show that Brigham and Thompson’s

conduct violated clearly established federal law. But as shown below, even

taking the factual allegations in the Complaint as true and construing

them in the light most favorable to ServPro, ServPro fails to show that

Brigham and Thompson’s conduct violated any federal law, let alone a

clearly established federal law.

B. The Merits

Again, ServPro alleges three constitutional violations: (1) the

Takings Clause of the Fifth Amendment, (2) the Due Process Clause of

the Fourteenth Amendment, and (3) the Contracts Clause of Article I, §

10 of the United States Constitution. The court addresses each in turn.3

1. The Takings Clause (Fifth Amendment)

The Takings Clause states, “[P]rivate property [shall not] be taken

for public use, without just compensation.” U.S. CONST. amend. V.

Takings Clause violations usually arise in one of two situations: (1)

“[w]here the government authorizes a physical occupation of property”; or

(2) where the government has regulated the use of property in a way that

“unfairly single[s] out the property owner to bear a burden that should be

borne by the public as a whole.” Yee v. City of Escondido, 503 U.S. 519,

523 (1992). To succeed under the Takings Clause, a plaintiff must show

“that he possesses a ‘property interest’ that is constitutionally protected”

and that the “deprivation or reduction of that interest constitutes a

‘taking.’” Keane v. Jacksonville Police Fire & Pension Fund Bd. Of Trs.,

775 Fed. Appx. 496, 499 (11th Cir. 2019) (quoting Givens v. Alabama Dep’t

3 The JSU Defendants asked the court to find that ServPro abandoned all claims that it did

not address in its response brief to their motion to dismiss. But “at the motion to dismiss

stage, the scope of a court’s review must be limited to the four corners of the complaint.”

Boyd v. Peet, 249 F. App'x 155, 157 (11th Cir. 2007) (citing St. George v. Pinellas County,

285 F.3d 1334, 1337 (11th Cir. 2002)). ServPro does not abandon its claims by “failing to

adequately address them in [its] response brief. The appropriate inquiry at this stage of the

litigation [is] whether the allegations of the complaint plausibly indicate that [ServPro] has

a claim for relief.” Id. Having determined that ServPro did not abandon its claims, the court

will now determine whether ServPro’s individual claims against Thompson and Brigham

can proceed on the merits.

of Corr., 381 F.3d 1064, 1066 (11th Cir. 2004)). “Where a party’s rights

were ‘voluntarily created by contract’ with a government, ‘interference

with such contractual rights generally gives rise to a breach claim not a

taking claim.’” Keane, 775 Fed. Appx. at 499 (quoting Baggett Transp. Co.

v. United States, 969 F.2d 1028, 1034 (Fed. Cir. 1992)).

ServPro voluntarily entered a contract with JSU to provide tornado-

recovery services. So ServPro cannot pursue a takings claim. Instead,

ServPro can pursue the “‘range of remedies associated with vindication of

a contract,’ such as a breach-of-contract claim” before the Alabama Board

of Adjustment. See Keane, 775 Fed. Appx. at 499 (quoting Castle v. United

States, 301 F.3d 1328, 1342 (Fed. Cir. 2002)).

2. The Due Process Clause (Fourteenth Amendment)

“A § 1983 claim alleging a denial of procedural due process requires

proof of three elements: (1) a deprivation of a constitutionally protected

liberty or property interest; (2) state action; and (3) constitutionally

inadequate process.” Keane, 775 Fed. Appx. at (citing J.R. v. Hansen, 803

F.3d 1315, 1320 (11th Cir. 2015)). If Alabama state law affords a plaintiff

“sufficient opportunity to pursue [its] claim, . . . the [state] statutory

scheme does not deprive [the plaintiff] of its claim for payment without

due process of law.” Lujan v. G & G Fire Sprinklers, Inc., 532 U.S. 189,

195 (2001).

ServPro argues that conflicting Alabama statues, administrative

codes, practices, and polices render ServPro without an effective civil

remedy. Yet ServPro has a claim pending before the Alabama Board of

Adjustment. And if that fails, ServPro can seek mandamus or relief

through Alabama State courts. So this claim fails.

3. The Contract Clause (Article I, Section 10)

The Contract Clause of Article I, Section 10 reads, “No State

shall . . . pass any . . . Law impairing the Obligation of Contracts.” U.S.

CONST. art. I, § 10. To evaluate claims brought under the Contract Clause,

the court must ask “whether there is a contractual relationship, whether

a change in law impairs that contractual relationship, and whether the

impairment is substantial.” Gen. Motors Corp. v. Romein, 503 U.S. 181,

186 (1992). Even if the court finds that a law or regulation substantially

impairs a contractual relationship, the court will still uphold the law or

regulation if it “serves a significant and legitimate public purpose, is

based on reasonable conditions, and is appropriate to the public purpose

justifying its enactment.” Taylor v. City of Gadsden, 958 F. Supp. 2d 1287,

1334 (N.D. Ala. 2013), aff’d, 767 F.3d 1124 (11th Cir. 2014) (citing Davken

v. City of Daytona Beach Shores, 366 Fed. App’x 40, 41 (11th Cir. 2010)).

The Eleventh Circuit provided instruction for how courts should

determine “whether legislative action qualifies as a breach of contract or

an impairment of contract.” Taylor v. City of Gadsden, 767 F.3d 1124,

1136 (11th Cir. 2014). According to the Eleventh Circuit, legislative action

qualifies as breach of contract if it “leaves the promisee with a remedy in

damages” and qualifies as an impairment of contract if it “extinguishes

the remedy.” Id. (quoting Horwitz–Matthews, Inc. v. City of Chicago, 78

F.3d 1248, 1250 (7th Cir.1996)).

The parties agree that ServPro and JSU were in a contractual

relationship. But ServPro cites no law or regulation that changed after it

entered the contract with JSU to perform tornado-recovery services that

substantially impaired the relationship. Instead, ServPro alleges that the

JSU Defendants refused to take actions to ensure that JSU paid ServPro

for work performed under the Contract. Further, ServPro can still seek a

remedy of damages through its claim with the Board of Adjustment.

Because ServPro’s Complaint does not include allegations to support each

element of a Contract Clause claim and does not support that a legislative

action extinguished its remedies, this claim cannot survive Rule 12(b)(6)

scrutiny.

___

To sum up, none of ServPro’s § 1983 claims can entitle ServPro to

relief. And re-pleading the complaint cannot fix the deficiencies with each

claim. Or, in legal terms, an amendment would be futile. So the court will

dismiss ServPro’s § 1983 claim with prejudice.

II. The court will not exercise supplemental jurisdiction over

the state law claims.

That leaves ServPro’s state law claims. (Doc. 1, ¶¶ 118-51). The

Eleventh Circuit has “encouraged district courts to dismiss any remaining

state claims when, as here, the federal claims have been dismissed prior

to trial.” Raney v. Allstate Ins. Co., 370 F.3d 1086, 1089 (11th Cir. 2004).

The court feels particularly encouraged to dismiss the state claims here

because they likely turn on thorny issues of Alabama law, such as state-

agent immunity. These state law issues are best left for state courts to

decide. See United Mine Workers of America v. Gibbs, 383 U.S. 715, 726–

27 (1966) (“Certainly, if the federal claims are dismissed before trial, even

though not insubstantial in a jurisdictional sense, the state claims should

be dismissed as well. Similarly, if it appears that the state issues

substantially predominate, whether in terms of proof, of the scope of the

issues raised, or of the comprehensiveness of the remedy sought, the state

claims may be dismissed without prejudice and left for resolution to state

tribunals.”).

Plus, ServPro has a pending claim before the Alabama Board of

Adjustment that ServPro asked the Board to hold until this court resolved

this case. (Doc. 27 at 9-15). Refusing to exercise jurisdiction over ServPro’s

state law claims will thus hasten the Board’s decision on ServPro’s

contract claim against JSU. So the court will dismiss ServPro’s state law

claims without prejudice under 28 U.S.C. § 1367(c).

III. The court dismisses claims against the fictitious defendants.

In its Complaint, ServPro also sues Fictitious Defendants A-Z. (Doc.

1.) “As a general matter, fictitious-party pleading is not permitted in

federal court.” Richardson v. Johnson, 598 F.3d 734, 738 (11th Cir. 2010).

ServPro has not given the court good reason to make an exception here,

particularly when ServPro has failed to plead a viable federal claim that

gives this court subject matter jurisdiction. So the court dismisses all

fictious parties without prejudice.

Again, the court makes no decisions under Alabama law and takes

no position on whether the Alabama courts or the Alabama Board of

Adjustment should ultimately decide the contractual dispute between

ServPro and JSU. All this court holds is that ServPro has not pleaded a

viable federal claim against JSU employees; nor can it under the facts

here.

CONCLUSION

For these reasons, the court will GRANT the JSU Defendants’

motion to dismiss on all counts. (Docs. 8, 25.) The court will DISMISS

WITH PREJUDICE ServPro’s federal claims and DISMISS WITHOUT

PREJUDICE ServPro’s state law claims and its claims against the

fictitious defendants. The court will enter a separate order that carries

out this opinion.

DONE on February 11, 2022.

Larespl Pla

COREY. MAZE ¢@

UNITED STATES DISTRICT JUDGE

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