Respondents Brief — Hotze Health Wellness Center International One, LLC, et al., Petitioners v. Environmental Research Center, Inc.

No. 21-738

IN THE SUPREME COURT OF THE UNITED STATES

HOTZE HEALTH WELLNESS CENTER INTERNATIONAL

ONE, LLC, PHYSICIAN’S PREFERENCE INTERNATIONAL,

LP, BRAIDWOOD MANAGEMENT, INC., PARADIGM

HOLDINGS, LLC, AND DR. STEVEN HOTZE,

V.

PETITIONERS,

ENVIRONMENTAL RESEARCH CENTER, INC.

RESPONDENT.

RESPONDENT’S CORRECTED BRIEF IN

OPPOSITION TO PETITION FOR WRIT OF

CERTIORARI

Jason R. Flanders

Supreme Court Bar No. 310734

Counsel

4030 Martin Luther King Jr. Way

Oakland, CA 94609

Email: jrf@atalawgroup.com

T: (916) 202-3018

Counsel for Respondent

Environmental Research Center

TABLE OF CONTENTS

I.

PROCEDURAL HISTORY ......................... 1

II.

CERTIORARI IS NOT WARRANTED ...... 4

III.

CONCLUSION ........................................... 8

ii

TABLE OF AUTHORITIES

Federal Cases

BP P.L.C. v. Mayor of Baltimore,

141 S. Ct. 1532 (2021) ............................................. 5

Envtl. Research Ctr. v. Hotze Health Wellness Ctr.

Int'l One, L.L.C.,

No. 20-cv-00370-VC, 2020 U.S. Dist. LEXIS 88768

(N.D. Cal. May 20, 2020) ................................. 3, 5, 7

Envtl. Research Ctr., Inc. v. Hotze Health Wellness

Ctr. Int'l One, L.L.C.,

No. 18-cv-05538-VC, 2018 U.S. Dist. LEXIS 221676

(N.D. Cal. Dec. 21, 2018) ................................. 1, 5, 7

Envtl. Research Ctr., Inc. v. Hotze Health Wellness

Ctr. Int'l One, LLC,

850 F. App'x 572 (9th Cir. 2021) ..................... 4, 5, 6

Envtl. Research Ctr., Inc. v. Hotze Health Wellness

Ctr. Int'l One, LLC, No. 18-17463, 2019 U.S. App.

LEXIS 27287 (9th Cir. Sep. 10, 2019)..................... 2

Envtl. Research Ctr., Inc. v. Hotze Health Wellness

Ctr. Int'l One, LLC, No. 18-17463, 2019 U.S. App.

LEXIS 8591 (9th Cir. Mar. 21, 2019) ...................... 2

Envtl. Research Ctr., Inc. v. Hotze Health Wellness

Ctr. Int'l One, LLC, No. 20-15457, 2020 U.S. App.

LEXIS 23844 (9th Cir. July 28, 2020) ................ 4, 6

Hotze Health Wellness Ctr. Int’l One, LLC v. Envtl.

Research Ctr., Inc., 140 S. Ct. 2514 (2020) ............. 2

iii

Hotze Health Wellness Ctr. Int'l One, LLC v. Envtl.

Research Ctr., Inc., 140 S. Ct. 2797 (2020) ............. 2

In re Hotze Health Wellness Ctr. Int'l One, LLC,

140 S. Ct. 466 (2019) ............................................... 2

Magadia v. Wal-Mart Assocs.,

999 F.3d 668 (9th Cir. 2021) ........................... 6, 7, 8

Powerex Corp. v. Reliant Energy Servs.,

551 U.S. 224 (2007).......................................... 4, 5, 7

Thermtron Prods., Inc. v. Hermansdorfer,

423 U.S. 336 (1976).................................................. 7

Federal Statutes

28 U.S.C. § 1442 .......................................................... 7

28 U.S.C. § 1443 .......................................................... 7

28 U.S.C. § 1447(d) ..................................................... 7

State Statutes

Cal. Health & Safety Code § 25249.5 ......................... 1

Cal. Health & Safety Code § 25249.7(d) .................... 1

Other Authorities

Sup. Ct. R. 10 .............................................................. 8

iv

RESPONDENT ENVIRONMENTAL RESEARCH

CENTER’S CORRECTED BRIEF IN

OPPOSITION TO PETITION FOR WRIT OF

CERTIORARI

I.

Procedural History

In the underlying California state court action

giving rise to this appeal, Respondent Environmental

Research Center alleges that Petitioners Hotze

Health and Wellness et al. violated California Health

and Safety Code section 25249.5 et seq, also known

as “Proposition 65.” Respondent initiated the state

court action purely in the public interest, as

authorized by state statute, without alleging any

injury to itself and without having suffered any

injury-in-fact. See Cal. H&S Code § 25249.7(d).

Petitioners removed the case to the United

States District Court for the Northern District of

California in 2018. The District Court remanded,

finding that Respondent lacked Article III standing:

“[t]he…motion to remand the case…is granted. The

Defendants have not shown that Environmental

Research Center would have Article III standing to

pursue their Proposition 65 action in federal court.”

Envtl. Research Ctr., Inc. v. Hotze Health Wellness

Ctr. Int'l One, L.L.C., No. 18-cv-05538-VC, 2018 U.S.

Dist. LEXIS 221676 at *1 (N.D. Cal. Dec. 21, 2018)

(modifications added) (hereafter “ERC I”). An order

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remanding for lack of federal jurisdiction is not

appealable, yet the District Court’s remand

nonetheless precipitated a series of frivolous appeals

by Petitioners.

Petitioners first appealed to the Ninth Circuit

Court of Appeals from the District Court’s decision to

remand. Petitioners’ appeal was denied. Envtl.

Research Ctr., Inc. v. Hotze Health Wellness Ctr. Int'l

One, LLC, No. 18-17463, 2019 U.S. App. LEXIS

8591, at *1 (9th Cir. Mar. 21, 2019). Petitioners then

sought rehearing en banc, which was denied (Envtl.

Research Ctr., Inc. v. Hotze Health Wellness Ctr. Int'l

One, LLC, No. 18-17463, 2019 U.S. App. LEXIS

27287, at *1 (9th Cir. Sep. 10, 2019)); filed a Petition

for Writ of Mandamus to the U.S. Supreme Court,

which was denied (In re Hotze Health Wellness Ctr.

Int'l One, LLC, 140 S. Ct. 466 (2019)); filed a Petition

for Certiorari to the U.S. Supreme Court, which was

denied (Hotze Health Wellness Ctr. Int’l One, LLC v.

Envtl. Research Ctr., Inc., 140 S. Ct. 2514 (2020));

and filed a Petition for Reconsideration of the Court’s

cert petition denial, which was denied. Hotze Health

Wellness Ctr. Int'l One, LLC v. Envtl. Research Ctr.,

Inc., 140 S. Ct. 2797 (2020).

Following the first remand order, Respondent

amended its Complaint to add two previously

dismissed parties back to the case as defendants and

to add two new, but related, parties as additional

2

defendants, asserting claims for single enterprise

and alter ego liability against all defendants. Envtl.

Research Ctr., Inc. v. Hotze Health Wellness Ctr. Int'l

One, LLC, infra, No. 20-15457, Dkt. 24-1, ER:10-27.

The Amended Complaint was consistent with the

original Complaint in all other respects, including

the exact same Proposition 65 violations, and

nothing more, in the public interest. Id. Petitioners

once more removed the action to the District Court

for the Northern District of California.

On May 20, 2020, the District Court again

remanded this case to California Superior Court,

finding no Article III standing. Envtl. Research Ctr.

v. Hotze Health Wellness Ctr. Int'l One, L.L.C., No.

20-cv-00370-VC, 2020 U.S. Dist. LEXIS 88768 at *12 (N.D. Cal. May 20, 2020) (hereafter “ERC II”)

(“This case is remanded…for the reasons stated at

the hearing and in the first remand order”). The

second remand order also awarded plaintiff

reasonable attorneys’ fees and costs for the second

District Court proceeding stating that “[t]he second

removal was without objective basis, particularly in

light of the fact that it was based almost entirely on

the same grounds as were rejected the first time

around.” Id. at *2.

Undeterred, Petitioners appealed the second

remand order in ERC II and the resulting fee award.

Envtl. Research Ctr., Inc. v. Hotze Health Wellness

3

Ctr. Int'l One, LLC, No. 20-15457, 2020 U.S. App.

LEXIS 23844, at *1-2 (9th Cir. July 28, 2020).

Respondent subsequently filed a motion to dismiss

the appeal, which was granted with regard to

Petitioners’ “challenge to the merits of the district

court’s remand order or the preceding related case

order” due to a lack of appellate jurisdiction. Id. The

Ninth Circuit denied Respondent’s motion to dismiss

Petitioners’ appeal from the District Court’s fee

award (id), but ultimately upheld the award. Envtl.

Research Ctr., Inc. v. Hotze Health Wellness Ctr. Int'l

One, LLC, 850 F. App'x 572, 573 (9th Cir. 2021).

The Ninth Circuit also granted Respondent’s

motion for damages: “ERC’s renewed motion for

damages is granted in part...Hotze’s challenge of the

district court’s second remand order and the

preceding related case order was frivolous. Neither of

these orders were appealable, yet Hotze continuously

argued to the contrary, and, each time, we rejected

its arguments as meritless.” Id. at 573.

Petitioners continue their pattern of frivolous

litigation tactics by filing the present Petition with

the Court.

II.

Certiorari is not Warranted

Petitioners argue in part that certiorari is

warranted because the framework established by

this Court’s decision in Powerex Corp. v. Reliant

Energy Servs., 551 U.S. 224 (2007) is too vague and

4

does not clearly decide whether the basis for the

District Court’s remand below was based on a lack of

subject-matter jurisdiction and, therefore, shielded

from appellate review. Pet. for Cert. at 11, 28-29.

Regardless of whether the Powerex decision is

too vague in some marginal cases, the present action

is clearly controlled by the decision. The district

court, in both ERC I and ERC II, expressly remanded

the action based on a lack of subject-matter

jurisdiction due Respondent’s lack of Article III

standing. ERC I, supra, No. 18-cv-05538-VC, 2018

U.S. Dist. LEXIS 221676 at *1; ERC II, supra,

L.L.C., No. 20-cv-00370-VC, 2020 U.S. Dist. LEXIS

88768 at *1-2. The District Court’s remand,

therefore, clearly satisfies the framework set forth in

Powerex which holds that remand orders based on a

lack of “subject-matter jurisdiction…[are] shielded

from review by § 1447(d)….” Powerex, supra, 551

U.S. at 234. The Ninth Circuit similarly found that

the District Court remanded the action because

Petitioner “failed to show that the district court had

subject matter jurisdiction.” Envtl. Research Ctr.,

Inc., supra, LLC, 850 F. App'x at 572-73 (9th Cir.

2021). There is no legitimate basis for Supreme

Court review on these facts.

Alternatively, Petitioners argue that

intervening decisions by the Court BP P.L.C. v.

Mayor of Baltimore, 141 S. Ct. 1532 (2021) and the

5

Ninth Circuit in Magadia v. Wal-Mart Assocs., 999

F.3d 668 (9th Cir. 2021) require that the Court grant

the Petition, or alternatively to grant the “grant the

petition, vacate the Ninth Circuit’s decision and

remand (“GVR”) for the lower court to reconsider in

light of BP and Magadia.” Pet. for Cert. at 11-12, 35.

Neither BP nor Magadia alter the legal landscape of

this case.

Petitioners mistakenly argue that under BP,

supra, 141 S.Ct. 1532, appellate review is available

for the District Court’s jurisdictional bases for

remand (e.g. lack of Article III standing) because the

District Court also declined to exercise prudential

standing over the action and otherwise abused its

discretion in declining to consider supplemental

jurisdiction. Pet. for Cert. at 32. According to

Petitioners, “these clear non jurisdictional anchors

for appellate review” authorize appellate review of

the jurisdictional aspects of the remand order. Id. 1

Without wading into the merits of Petitioners’

prudential standing and supplemental jurisdiction

1 Petitioners also raise phantom due process concerns arising

from the District Court’s fee award: “An order that is Obviously

ultra vires…would violate due process if not open to appellate

review somewhere.” Pet. for Cert. at 32 (emphasis in original).

The Ninth Circuit, however, did provide appellate review of the

District Court’s fee award, and ultimately upheld it. Envtl.

Research Ctr., supra, 2020 U.S. App. LEXIS 23844, at *1-2;

Envtl. Research Ctr., supra, 850 F. App’x 572-573.

6

arguments, Petitioners ignore that the holding in BP

was premised on express statutory language in 28

U.S.C. § 1447(d) providing that “an order remanding

a case to the State court from which it was removed

pursuant to…[28 USCS § 1442 or 1443] shall be

reviewable by appeal or otherwise.” BP, 141 S.Ct. at

1536-37 (quoting 28 U.S.C. § 1447(d)). Under BP, the

term “order” authorizes appellate review of all bases

for removal decided by a remand order as long as the

action was removed, at least in part, pursuant to §§

1442-43. Id. at 1537-38. Petitioners here did not

remove the action pursuant to 28 USCS § 1442 or §

1443, and there is otherwise no comparable statutory

authorization permitting review of the remand order

in ERC II, which was based expressly on a lack of

subject matter jurisdiction and is otherwise shielded

from appellate review. Thermtron Prods., Inc. v.

Hermansdorfer, 423 U.S. 336, 345-46 (1976); accord.

Powerex, supra, 551 U.S. at 230.

The Ninth Circuit’s decision in Magadia,

supra, 999 F.3d 668, moreover, simply restates and

applies existing Ninth Circuit and Supreme Court

precedent regarding assignment and informational

theories of standing. 673-680. Each of these theories

of standing were fully briefed by Petitioners first in

ERC I and again in ERC II and were rejected both

times at by the District Court and Ninth Circuit.

Petitioners seek to use this Petition as a means to

7

again relitigate the merits of those issues. Neither

Magadia or BP constitute “intervening

developments” that would otherwise alter the

decision of the Ninth Circuit; nor do they alter or run

counter to existing Court precedent, which clearly

controls in the present action.

Petitioners use the remainder of the Petition

as a vehicle to argue simply that the Ninth Circuit

wrongly decided the issues presented on appeal.

Without wading into the thicket of Petitioners’

myriad and often convoluted arguments, Rule 10 of

the Rules of the Supreme Court clarifies that these

considerations rarely warrant granting a petition for

certiorari: “[a] petition for a writ of certiorari is

rarely granted when the asserted error consists of

erroneous factual findings or the misapplication of a

properly stated rule of law.” Petitioners have

provided no compelling argument for deviating from

this general principle.

III.

Conclusion

The pending Petition for Certiorari continues

Petitioners’ multi-year pattern of frivolous pleadings

in federal court where no federal jurisdiction lies. For

each of the foregoing reasons, Respondent

respectfully asks that the Court deny the present

Petition for Certiorari.

Date: December 16, 2021

8

Respectfully Submitted,

/s/ Jason R. Flanders

Aqua Terra Aeris Law Group

4030 Martin Luther King Jr. Way

Oakland, CA 94609

(916) 202-3018

jrf@atalawgroup.com

Counsel for Respondent

Environmental Research Center

9