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Momtazi Family, LLC v. Wagner

United States District Court, D. Oregon

August 27, 2019

MOMTAZI FAMILY, LLC, Plaintiff,
v.
MARY E. WAGNER; RICHARD WAGNER; STEVEN R. WAGNER; and YAMHILL NATURALS, LLC, Defendants.

          RACHEL E. MCCART PRESERVE LEGAL SOLUTIONS, P.C. ATTORNEYS FOR PLAINTIFF

          ALLISON C. BIZZANO MATTHEW A. GOLDBERG ATTORNEYS FOR DEFENDANTS

          OPINION AND ORDER

          ANNA J. BROWN UNITED STATES SENIOR DISTRICT JUDGE

         This matter comes before the Court on the Motion (#9) to Dismiss with Prejudice filed by Defendants Mary E. Wagner, Richard Wagner, Steven R. Wagner, and Yamhill Naturals, LLC.

         The Court concludes the record is sufficiently developed, and, therefore, oral argument is not necessary to resolve Defendants' Motion.

         For the reasons that follow, the Court DENIES Defendants' Motion.

         BACKGROUND

         On April 2, 2019, Plaintiff Momtazi Family, LLC, filed a Complaint against Defendants for violation of the Racketeer Influenced and Corrupt Organizations Act (RICO), 18 U.S.C. § 1962. The following facts are taken from Plaintiff's Complaint and the pleadings filed by the parties.

         Plaintiff is an Oregon limited liability company that operated the Momtazi Vineyard, a certified biodynamic vineyard, on property in McMinnville, Oregon (the Momtazi property). From 2016 through 2018 Plaintiff grew grapes on the property and sold the grapes to other wine producers including Maysara Winery, which Plaintiff also owns. On August 1, 2018, Plaintiff began leasing the Momtazi property to Maysara, which now operates the vineyard.

         On December 19, 2016, Defendants Mary and Steven Wagner, husband and wife, purchased real property adjacent to the Momtazi property. In January 2017 Defendant Richard Wagner, the son of Mary and Steven, moved onto the Wagner property.

         Plaintiff alleges Defendants invested in the development of the Wagner property to produce and to process marijuana, built structures and installed fixtures for the production of marijuana, and moved large amounts of soil to the Wagner property to form terraces in order to increase the size of the outdoor marijuana-grow area. Plaintiff alleges Defendants market or intend to market the marijuana grown on their property under the brand name "Yamhill Naturals." Although Richard Wagner directs the operations of Defendant Yamhill Naturals, Plaintiff alleges each Defendant will receive a portion of the proceeds of the marijuana operation.

         According to Plaintiff, one of its customers cancelled an order for six tons of grapes grown on Plaintiff's property because of the marijuana operation on Defendants' property. Plaintiff alleges the customer cancelled the order because it contained grapes grown on the section of the Momtazi property adjacent to Defendants' property. The customer believed the smell created by the marijuana contaminated the grapes and would affect the wine made from those grapes. Plaintiff alleges it now is unable to sell grapes grown on its property next to Defendants' property.

         Plaintiff also alleges the terracing on Defendants' property caused large amounts of dirt to flow downhill into one of the fish-stocked reservoirs located on Plaintiff's property. Plaintiff contends this created a hazard to the fish and wildlife that form "an essential part of Plaintiff's biodynamic operation." Plaintiff also contends Defendants or their agents trespassed onto Plaintiff's property, killed a calf, and amputated part of another cow's tail.

         In summary, Plaintiff alleges the marijuana operation on Defendants' property has "directly and materially diminished the Momtazi property's fair market value," decreased the "marketability of grapes grown on that vineyard property," and decreased the rental income of the property.

         STANDARDS

         I. Motion to Dismiss for Lack of Subject-Matter Jurisdiction Pursuant to Federal Rule of Civil Procedure 12(b)(1)

         “[F]ederal courts are limited to deciding ‘cases' and ‘controversies.'” Bova v. City of Medford, 564 F.3d 1093, 1095 (9th Cir. 2009)(quoting United States Const. Art. III, § 2). “Two components of the Article III case or controversy requirement are standing and ripeness.” Id. at 1096 (citing Colwell v. Dep't of Health & Human Servs., 558 F.3d 1112, 1121 (9th Cir. 2009)). A motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(1) tests the subject-matter jurisdiction of a federal court.

         To satisfy the standing requirement of Article III, a plaintiff must show “‘an injury in fact'; ‘a causal connection between the injury and the conduct complained of' and a conclusion that it is ‘likely,' as opposed to merely ‘speculative,' that the injury will be ‘redressed by a favorable decision.'” Arizona Christian Sch. Tuition Org'n v. Winn, 131 S.Ct. 1426, 1437 (2011)(quoting Lujan v. Defenders of Wildlife, 504 U.S. 555, 560-61 (1992)). See also Spokeo, Inc. v. Robins, 136 S.Ct. 1540, 1547 (2016). “The party invoking federal jurisdiction bears the burden of establishing these elements.” Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992). See also Renee v. Duncan, 623 F.3d 787, 801 (9th Cir. 2010).

         The plaintiff must also establish standing for each form of relief sought. Friends of the Earth, Inc. v. Laidlaw Envt'l Servs., Inc. (TOC), 528 U.S. 167, 185 (2000). See also Mayfield v. U.S., 599 F.3d 964, 969 (9th Cir. 2010). The “elements of standing must be supported in the same way as any other matter for which a plaintiff bears the burden of proof, i.e., with the manner and degree of evidence required at the successive stages of the litigation.” Gest v. Bradbury, 433 F.3d 1177, 1181 (9th Cir. 2006). General factual allegations of injury resulting from the alleged wrongful conduct may suffice at the pleading stage. Id.

         II. Motion to Dismiss for Failure to State a Claim Pursuant to Federal ...


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