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Yuen v. Triple B Services, LLP

United States District Court, S.D. Texas, Houston Division

June 8, 2019

XENOS YUEN, AS TRUSTEE FOR KAM CHU CHENG, d/b/a KCC ENTERPRISES, Plaintiff,
v.
TRIPLE B SERVICES LLP, ASHLAR DEVELOPMENT, LLC, BIG R TRUCKING, LLC, JUAN LUIS BARBA, RAUL BARBA, JR., J. MARTINEZ TRUCKING, and JOHN DOE TRUCK DRIVERS 1-100, Defendants.

          MEMORANDUM AND RECOMMENDATION

          FRANCES H. STACY, UNITED STATES MAGISTRATE JUDGE.

         Pending in this case that has been referred to the undersigned Magistrate Judge for all further pretrial proceedings is Defendant Triple B Services, LLC's Partial Motion to Dismiss (Document No. 13), Defendants Juan Luis Barba, Raul Barba, Jr., Martines Trucking, Danny Arjona, David Vela, MTZ Trucking, Inc., Big R Trucking, LLC, and Esteban Requena d/b/a Transport Requena A.'s Motion to Dismiss Plaintiffs Complaint (Document No. 23), Defendant Ashlar Development, LLC's Rule 12(b)(6) Motion to Dismiss (Document No. 25), and Defendant Pedro Amaya d/b/a Santa Fe Trucking's Motion to Dismiss (Document No. 49). Having considered those motions, Plaintiffs responses, the allegations and claims in Plaintiffs Second Supplemental Complaint (Document No. 52), and the parties' agreement and acknowledgment at the Status Conference held on May 1, 2019, that the Motions to Dismiss address the allegations and claims in the subsequently filed "Second Supplemental Complaint," and the applicable law, the Magistrate RECOMMENDS, for the reasons set forth below, that Defendants' Motions to Dismiss (Document Nos. 13, 23, 25 and 49) all be GRANTED, that Plaintiffs federal claims under the Racketeering Influenced and Corrupt Organizations Act (RICO) and the Resource Conservation and Recovery Act/Comprehensive Environmental Response, Compensation and Liability Act (RCRA/CERCLA) be DISMISSED pursuant to FED. R. Civ. P. 12(b)(6) for failure to state a claim, and that the Court DECLINE to exercise supplemental jurisdiction over the remaining state law claims.

         I. Background

         This case is based on alleged damage to Plaintiffs property by virtue of the unauthorized dumping by Defendants of large quantities of dirt/soil on that property. Plaintiff alleges in the Second Supplemental Complaint that it seeks

to recover the damages including the costs of the removal of hundreds of thousands of tons of soil defendants and their agents deposited on the property [Plaintiff] owns in Harris County, Texas. Plaintiff further seeks damages for the loss of use, the damages to the value of its land, contamination caused by altering the flood plain, flood table and drainage, and exemplary damages stemming from the trespass, conversion, quantum meruit, reckless and grossly negligent conduct of defendants.

(Document No. 54 at 2). According to Plaintiff, Defendant Ashlar Development, LLC ("Ashlar") is the developer of a master planned community in northeast Harris County, Texas, known as "The Grove"; Ashlar contracted with Triple B Services LLC ("Triple B") "to clear the land and construct the roads and other amenities in The Grove"; "As part of its obligations with Ashlar, Triple B was to remove the excavated earth and take it to an authorized dump site in Liberty County"; instead of taking the excavated earth to an authorized dump site in Liberty County, Triple B "directed the drivers to begin dumping or negligently or recklessly allowed the defendant-drivers to illegally dump the earth on Plaintiffs land"; this unauthorized dumping consisted of "hundreds of thousands of cubic yards of soil at [Plaintiffs] property, creating vast mounds of soil built up to over 40 feet high"; "[t]his soil altered the subject property with respect to the flood plain or flood-way, causing flood water to build up quickly during Hurricane Harvey and other heavy downfalls, allowing spilled waste oil to filter outside the oil tank protective dike which surrounded the oil tanks and oil pumps located within the boundary of [Plaintiffs] [ ] property"; and that the "overflowing of the oils accumulated within the dike" and the destruction of "the oil tanks piping due to the flotation of the tanks" resulted in the contamination of Plaintiffs soil and the surrounding public water way(s). Plaintiffs Second Supplemental Complaint (Document No. 54) at 19-20.[1] Plaintiff asserts claims against Defendants for: (1) violations of the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. § 6901 et seq., and/or the Comprehensive Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C. § 9601 et seq.; (2) violations of the Racketeering Influenced and Corrupt Organizations Act ("RICO), 18 U.S.C. § 1961, et seq.; (3) trespass; (4) nuisance; (5) negligence; (6) gross negligence; (7) conversion; and (8) quantum meruit. Defendants seek the dismissal of the RCRA and RICO claims on the basis that Plaintiff has failed to state a claim for which relief may be granted. Several of the Defendants also argue that the Court should, in the absence of a plausible federal claim, decline to exercise supplemental jurisdiction over the remaining state law claims. All briefing on the pending Motions to Dismiss is complete and the parties agree that the arguments and issues to be decided in connection with the Motions to Dismiss survive the subsequent filing of Plaintiff s "Second Supplemental Complaint" (Document No. 54).

         II. Rule 12(b)(6) Standard of Review

         Rule 12(b)(6) provides for dismissal of an action for "failure to state a claim upon which relief can be granted." FED. R. Civ. P. 12(b)(6). "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, 129 S.Ct. 1937, 1949 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim is said to be plausible if the complaint contains "factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Iqbal, 129 S.Ct. at 1949. Plausibility will not be found where the claim alleged in the complaint is based solely on legal conclusions, or a "formulaic recitation of the elements of a cause of action." Twombly, 550 U.S. at 555. Nor will plausibility be found where the complaint "pleads facts that are merely consistent with a defendant's liability" or where the complaint is made up of'"naked assertions devoid of further factual enhancement.'" Iqbal, 129 S.Ct. at 1949 (quoting Twombly, 550 U.S. at 557)). Plausibility, not sheer possibility or even conceivability, is required to survive a Rule 12(b)(6) motion to dismiss. Twombly, 550 U.S. at 556-557; Iqbal, 129 S.Ct. at 1950-1951.

         In considering a Rule 12(b)(6) motion to dismiss, all well pleaded facts are to be taken as true, and viewed in the light most favorable to the plaintiff. Scheuer v. Rhodes, 416 U.S. 232, 236 (1974). But, as it is only facts that must be taken as true, the court may "begin by identifying the pleadings that, because they are no more than conclusions, are not entitled to the assumption of truth." Iqbal, 129 S.Ct. at 1950. It is only then that the court can view the well pleaded facts, "assume their veracity and [ ] determine whether they plausibly give rise to an entitlement to relief." Id. at 1950.

         III. Discussion - Federal claims (RICO and RCRA)

         This case was filed in this Court, with subject matter jurisdiction being premised on Plaintiffs assertion of two federal claims - a RCRA claim and a RICO claim. Defendants all argue in their respective Motions to Dismiss that Plaintiff has not, and cannot, state a plausible RCRA claim or a plausible RICO claim. For the reasons that follow, the Magistrate Judge agrees.

         A. RCRA/CERCLA Claim

         The Resource Conservation and Recovery Act (RCRA) provides that "any person may commence a civil action on his own behalf-against any person, including the United States and any other governmental instrumentality or agency, to the extent permitted by the eleventh amendment to the Constitution, and including any past or present generator, past or present transporter, or past or present owner or operator of a treatment, storage, or disposal facility, who has contributed or who is contributing to the past or present handling, storage, treatment, transportation, or disposal of any solid or hazardous waste which may present an imminent and substantial endangerment to health or the environment." 42 U.S.C. § 6972(a)(1)(B) (emphasis added). "[T]o prevail on 'contributing to' claim under [RCRA], [a] plaintiff is required to demonstrate: (1) that defendant is a person, including, but not limited to, one who was or is generator or transporter of solid or hazardous waste or one who was or is owner or operator of solid or hazardous waste treatment, storage, or disposal facility; (2) that defendant has contributed to or is contributing to handling, storage, treatment, transportation, or disposal of solid or hazardous waste; and (3) that solid or hazardous waste may present imminent and substantial endangerment to health or environment." Cox v. City of Dallas, Tex., 256 F.3d 281 (5th Cir. 2001).

         The Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) was enacted to promote the "timely cleanup of hazardous waste sites and to ensure that the costs of such cleanup efforts were borne by those responsible for the contamination." Burlington Northern and Santa Fe Ry. Co. v. U.S., 556 U.S. 599, 602 (2009). CERCLA liability applies to "any person who by contract, agreement, or otherwise arranged for disposal or treatment, or arranged with a transporter for transport for disposal or treatment, of hazardous substances owned or possessed by such person, by any other party or entity, at any facility or incineration vessel owned or operated by another party or entity and containing such hazardous substances." 42 U.S.C. § 9607(a)(3). "[A]n entity may qualify as an arranger . . . when it takes intentional steps to dispose of a hazardous substance. Burlington Northern, 556 U.S. at 611.

         The allegations in Plaintiffs Second Supplemental Complaint supporting the RCRA claim are as follows:

58. ... Without the permission or effective consent of [Plaintiff], on or about October 6, 2016, at Moonshine Hill, Houston, Harris County Texas, and Belleau Wood, Houston, Harris County, Texas, TRUCK DRIVERS began dumping enormous amounts of dirt on Harris County Appraisal District ("HCAD") parcel numbers 042077000002 and 0420770000283, both of which Plaintiff owns, and has owned during the periods pertinent to this action ("Plaintiffs Land").
59. Defendant Ashlar contracted with Defendant Triple B to clear the land and construct the roads and other amenities in The Grove. As part of its obligations with Ashlar, Triple B was to remove the excavated earth and take it to an authorized dump site in Liberty County, Texas. Triple B contracted with numerous John Does to remove the excavated earth and transport the earth to the authorized site.
60. Defendant Ashlar, and or its agents[, ] excavated the dirt it dumped on plaintiffs land from a nearby construction site where Ashland was building The Grove, a master planned community in northeast Harris County, Texas.
61. Instead, Triple B directed the drivers to begin dumping or negligently or recklessly allowed the defendant[]-drivers to illegally dump the earth on Plaintiffs Land. Thus, they dumped hundreds of thousands of cubic yards of soil at [Plaintiffs] property, creating vast mounds of soil built up to over 40 feet high. This soil altered the subject property with respect to the flood plain or flood-way, causing the flood water to build up quickly during [ ] Hurricane Harvey and other heavy downfalls, allowing spilled waste oil to filter outside the oil tank protective dike which surrounded the oil tanks and oil pumps located within the boundary of [Plaintiffs] property. The overflowing of the oils accumulated within the dike, and [sic] destroying the oil tanks piping due to the flotation of the tanks because of [sic] the floodwater or rainwater causes heavy spilling of the oil stored within the tank and the dike due to the buoyancy of the tank, and thus contaminated [Plaintiffs] soil and water around.
62. As a result of this illegal dumping, the City of Houston has cited Plaintiff, and compelled [Plaintiff] to cease all activity on Plaintiff s Land, thus halting [Plaintiff s] development of the property for [a] commercial fishing farm. At the northern end of the property, some of the dumped dirt [has] migrated into a public water way.
63. Plaintiff was unaware of the dumping until the City of Houston contacted it. At no time did [Plaintiff] consent to the defendants['] dumping of soil in this huge quantity.
64. Wherefore, Plaintiff requests contribution for any and all associated costs for cleanup of the earth from Plaintiff s property, [and] restore the topography of the land and pond within the property, together with any and all incidental damages, costs of court, interest, and ...

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