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Henry G. Wykowski (State Bar No. 068255)
HENRY G. WYKOWSKI & ASSOCIATES
235 Montgomery Street, Suite 657
San Francisco, CA 94104
Telephone: (415) 788-4545
Facsimile: (415) 788-4546
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Attorneys for Claimant
PATIENTS MUTUAL ASSISTANCE
COLLECTIVE CORPORTATION,
and SAN JOSE WELLNESS
dba HARBORSIDE HEALTH CENTER
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UNITED STATES DISTRICT COURT
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FOR THE NORTHERN DISTRICT OF CALIFORNIA
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SAN FRANCISCO DIVISION
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No. CV 12-3566 MEJ
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UNITED STATES OF AMERICA,
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Plaintiff,
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v.
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REAL PROPERTY AND IMPROVEMENTS
LOCATED AT 2106 RINGWOOD
AVENUE, SAN JOSE, CALIFORNIA
Defendant.
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PATIENTS MUTUAL ASSISTANCE
COLLECTIVE CORPORTATION, and SAN
JOSE WELLNESS, dba HARBORSIDE
HEALTH CENTER
Claimant.
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H ENRY G.
W YKOWSKI &
A SSOCIATES
A T T ORNE YS A T L AW
CLAIMANT HARBORSIDE’S OPPOSITION TO MOTION FOR ORDER
United States v. Real Property Improvements., CV 12-3566 MEJ
CLAIMANT PATIENTS MUTUTAL
ASSISTANCE COLLECTIVE
CORPORATION, and SAN JOSE
WELLNESS dba HARBORSIDE
HEALTH CENTER’S OPPOSITION
TO CLAIMANT CONCOURSE’S
MOTION FOR AN ORDER
PROHIBITING UNLAWFUL USE
OF DEFENDANT PROPERTY
Hearing Date:
Time:
Judge:
October 11, 2012
1 p.m.
Hon. Maria Elena James
Complaint Filed:
Trial Date:
July 9, 2012
None Set
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TABLE OF CONTENTS
I.
INTRODUCTION .......................................................................................................... 1
II.
STATEMENT OF FACTS ............................................................................................. 2
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a. Legal Use of Medical Cannabis in California .......................................................... 2
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b. Legal Production and Distribution of Medical Cannabis in
California .................................................................................................................. 3
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c. Harborside Health Center and Harborside San Jose................................................. 4
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d. The Current Forfeiture Action and Landlord’s Motion for
Preliminary Injunction. ............................................................................................. 4
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III.
LANDLORD, AS A PRIVATE PARTY, LACKS STANDING TO
ENFORCE THE CONTROLLED SUBSTANCES ACT .............................................. 6
IV.
INJUNCTIONS THAT WOULD ALTER THE STATUS QUO
ARE HIGHLY DISFAVORED .................................................................................... 9
V.
MOVING PARTY HAS NOT MET ITS BURDEN OF SHOWING
A LIKELIHOOD OF IRREPARABLE HARM IF NO PRELIMINARY
INJUNCTION ISSUES AND THE CIVIL FORFEITURE
CONTINUES TO BE LITIGATED ON THE MERITS. ............................................. 10
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a. The Moving Party has an Obligation to Show Irreparable Harm.
No Such Harm is Alleged. The Motion Must be Denied
Unless Harm is Alleged. ......................................................................................... 11
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VI.
THE BALANCE OF EQUITIES WEIGHS AGAINST A
PRELIMINARY INJUNCTION .................................................................................. 13
VII.
OAKLAND CANNABIS BUYER’S PROVIDES NO PRECEDENT,
NOR ANYJUSTIFICATION, FOR TRANSFORMING AN IN REM
CIVIL FORFEITURE INTO AN ACTION FOR INJUNCTION. .............................. 14
VIII.
CONCLUSION ............................................................................................................ 16
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CLAIMANT HARBORSIDE’S OPPOSITION TO MOTION FOR ORDER
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TABLE OF AUTHORITIES
Cases
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Amoco Production Co. v. Village of Gambell, AK, 480 U.S., 531 (1987).................................... 13
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Buckman Co. v. Plaintiff’s Legal Comm., 531 U.S. 341 (2001). .................................................... 7
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California v. Sierra Club, 451 U.S. 287 (1981) ................................................................................ 8
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Durr v. Strickland, 602 F.3d 788 (6th Cir. 2010) ............................................................................. 6
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Freedom Holdings, Inc. v. Spitzer, 408 F3d 112 (2nd Cir. 2005) ................................................. 12
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International Church of the Foursquare Gospel v. City of San Leandro,
WL 2904046. (N.D. Cal., Oct. 2, 2007, C 07-3605 PJH) (2007) ..................................................... 9
Jones v. Hobbs, 745 F.Supp.2d 886 (E.D. Ark. 2010) ................................................................. 6, 8
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Liveops, Inc. v. Teleo, Inc., WL 83058 (N.D. Cal. 2006)................................................................ 9
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McAllister v. Purdue Pharma L.P. 164 F.Supp.2d 783 (S.D.W.Va 2001) ....................................... 6
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Monsanto Co. v. Geertson Seed Farms, 130 S. Ct. 2743 (2010). .................................................. 11
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Munaf v. Geren, 553 U.S. 674 (2008) ............................................................................................ 11
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Park Village Apt. Tenants Ass’n v. Mortimer Howard Trust,
636 F3d 1150 (9th Cir. 2011) ................................................................................................... 11, 12
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Railroad Comm'n of Tex. v. Pullman Co., 312 U.S. 496 (1941). .................................................. 13
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Ringo v. Lombardi, 2010 WL 3310240 (W.D. M.O 2010). ........................................................ 7, 8
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Stormans, Inc. v. Selecky, 586 F.3d 1109 (9th Cir. 2009) ............................................................. 12
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U.S. v. Cannabis Cultivator's Club, WL 1310460
(N.D. Cal., June 10, 2002, C 98-00085 CRB) (2002) .................................................................... 15
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U.S. v. Oakland Cannabis Buyer’s Co-op, 532 U.S. 483 (2001) ................................ 10, 14, 15, 16
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U.S. v. Ferro, 681 F.3d 1105 (9th Cir. 2012) ................................................................................ 16
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Weinberger v. Romero–Barcelo, 456 U.S., 305 (1982) ................................................................. 13
West v. Ray, WL 3825672 (M.D. Tenn 2010) ................................................................................. 6
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CLAIMANT HARBORSIDE’S OPPOSITION TO MOTION FOR ORDER
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Winter v. Natural Resources Defense Council, Inc., (2008) 555 US 7 (2008) .................... 1, 11, 12
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Statutes and Rules
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21 U.S.C. § 882 ............................................................................................................................... 6
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Fed. Supplemental Rule of Civ. Proc. G 7(a ................................................................................ 6, 8
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Ca. Health & Saf. Code § 11362.5 ................................................................................................... 2
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Ca. Health & Saf. Code § 11362.76 ................................................................................................. 3
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Ca. Health & Saf. Code §11362.775 ............................................................................................... 3
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Ca. Health & Saf. Code § 11362.83 ................................................................................................. 3
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CLAIMANT HARBORSIDE’S OPPOSITION TO MOTION FOR ORDER
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I.
INTRODUCTION
This case is a civil forfeiture action by the United State government against a res in San
Jose, California. The complaint contains no claim for injunctive relief. Yet preliminary
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injunction is now requested by the owner of the property, a sophisticated commercial landlord,
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who claims that even though the subject property lease openly states that its purpose is for tenant
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to operate a medical cannabis dispensary, it “mistakenly believed” until the time the forfeiture
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action was filed that this purpose was not controversial under federal law.
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The instant preliminary injunction motion, if granted, would shut down the San Jose
operations of Harborside Health Center, which to its knowledge is the largest, most intensely
studied, and most State-law compliant medicinal cannabis dispensary in the State of California.
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Harborside will be fully prepared to litigate the forfeiture action, including discovery, motions for
summary judgment, and trial on the merits. Entering the requested injunction would effectively
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give the Government the victory it seeks (via a back door route through the landlord no less)
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without it going through the orderly process of litigating the action it chose to file.
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Injunction is an equitable remedy. The Court must weigh all of the equities pursuant to
the four-factor test set out by the Supreme Court in Winter v. Natural Resources Defense Council,
Inc., (2008) 555 US 7, 129 S.Ct. 365. The Court may enter a preliminary injunction only after a
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moving party has demonstrated the “likelihood of irreparable harm” should the request be denied.
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Id. Here, the moving papers argue only that a violation of the Controlled Substances Act has
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been alleged; ergo the requested injunction must issue. However, there is no showing whatsoever
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that “irreparable harm” would occur if the parties simply continued to litigate the forfeiture action
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to its conclusion. Moreover, no other “equity” is even discussed in the moving papers. If the
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“equities” are discussed (in moving party’s reply papers or elsewhere), Harborside would require
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CLAIMANT HARBORSIDE’S OPPOSITION TO MOTION FOR ORDER
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the opportunity to rebut such a showing, and would request that an evidentiary hearing be held at
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a later date so it could do so.
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Finally, this motion has been brought by a party without standing—a private party that
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seeks to enforce the Controlled Substances Act (which is enforceable only by the federal
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government). That private party, the Landlord, had notice through the lease itself of the acts that
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it now contends violated the CSA. This constitutes and additional powerful reason that issuing
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the requested injunction would be both procedurally improper and entirely inequitable. For all of
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the reasons discussed in this Opposition, the instant preliminary injunction motion should be
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denied.
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II.
STATEMENT OF FACTS
a. Legal Use of Medical Cannabis in California.
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In 1996, California voters adopted Proposition 215, the “Compassionate Use Act” Health
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& Saf. Code § 11362.5. The Act is intended to “ensure that seriously ill Californians have the
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right to obtain and use marijuana for medical purposes where that medical use is deemed
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appropriate and has been recommended by a physician who has determined that the person’s
health would benefit from the use of marijuana”; “ensure that patients and their primary
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caregivers who obtain and use marijuana for medical purposes upon the recommendation of a
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physician are not subject to criminal prosecution or sanction”; and “encourage the federal and
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state governments to implement a plan to provide for the safe and affordable distribution of
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marijuana to all patients in medical need of marijuana.” Health & Saf. Code, § 11362.5(b)(1)(A)-
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(C).
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CLAIMANT HARBORSIDE’S OPPOSITION TO MOTION FOR ORDER
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b. Legal Production and Distribution of Medical Cannabis in California.
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In 2003, the Legislature added the “Medical Marijuana Program Act,” article 2.5,
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(“MMPA”), to the Health and Safety Code. The purposes of the MMPA include “[promoting]
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uniform and consistent application of the [Compassionate Use Act] among counties within the
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state” and “[enhancing] the access of patients and caregivers to medical marijuana through
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collective, cooperative cultivation projects.” Stats. 2003, ch. 875, § 1, subd. (b). The statute
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includes guidelines for the implementation of the Compassionate Use Act. Among other things,
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it provides that qualified patients and their primary caregivers have limited immunity from
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prosecution for violation of various sections of the Health and Safety Code regulating marijuana
including the “drug den” abatement law. §§ 11362.765, 11362.775. This portion of the Act is
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expressly intended to exempt dispensaries from prosecution under section 11570 that provides:
“Every building or place used for the purpose of unlawfully selling, serving, storing, keeping,
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manufacturing, or giving away any controlled substance … is a nuisance which shall be enjoined,
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abated, and prevented, and for which damages may be recovered, whether it is a public or private
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nuisance.” Additionally, the MMPA provides: “Nothing in this article shall prevent a city or other
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local governing body from adopting and enforcing laws consistent with this article.” § 11362.83.
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c. Harborside Health Center and Harborside San Jose.
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Harborside Health Center (“Harborside”) is probably California’s largest medical
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cannabis dispensary. Certainly it is one of the most compliant with the Compassionate Use Act
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and with the MMPA.
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Harborside’s original location, 1840 Embarcadero, Oakland, California, was fully
permitted by the City of Oakland as a medical cannabis dispensary in 2006 after a competitive
process that resulted in permits being granted to only four dispensaries citywide. Since
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Harborside commenced operations, it has paid city, state and federal taxes. It has grown to
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employ dozens of individuals, all of whom receive a fair salary and full health benefits, and for
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whom Harborside has paid all payroll taxes. The federal government has received Harborside’s
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tax payments since the dispensary’s inception. Federal government employees have toured
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Harborside’s Oakland dispensary.1
In 2011, Harborside began operations in San Jose, by assuming a lease that had been
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entered into in 2009 between Landlord Concourse, LLC (“Landlord”) and another medical
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cannabis dispensary. Its location is 2106 Ringwood Avenue, San Jose, which is the Defendant
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res in the present action for civil forfeiture. As Landlord admits in its moving papers, all parties
to the lease were aware from the beginning that the object of the lease was to operate a medical
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cannabis dispensary at the subject property. It was written into the lease itself that the purpose
was to operate a medical cannabis dispensary. Harborside has paid its rent monthly and Landlord
never voiced any complaints about Harborside as a tenant.
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d. The Current Forfeiture Action and Landlord’s Motion for Preliminary
Injunction.
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The harmony between Landlord and Harborside was interrupted on July 9, 2012, when the
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United States, without warning, filed an action seeking civil forfeiture of the subject property.
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(The complaint contained no claim or prayer for injunctive relief.) The action was particularly
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surprising because until then, it appeared that the United States government (and certainly the
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U.S. Attorney for the Northern District of California) had targeted only dispensaries that clearly
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were noncompliant with the Compassionate Use Act and the MMPA, or were in violation of
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some land use regulation such as being too close to a park or a school. However, the forfeiture
complaint in this action (and the related action against the Oakland property) contained no such
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In 2010, the I.R.S. began an audit of Harborside’s taxes, which is still ongoing.
CLAIMANT HARBORSIDE’S OPPOSITION TO MOTION FOR ORDER
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allegations against Harborside—only that there were violations of the federal Controlled
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Substances Act (CSA) taking place on the subject properties. Recognizing the sharp departure
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from prior policy, the United States Attorneys’ Office issued the following press release just two
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days after filing the actions:
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“On Monday, July 9, this office filed civil forfeiture actions against
1840 Embarcadero, Oakland, California, and 2106 Ringwood
Avenue, San Jose, where Harborside, a marijuana dispensary
claiming over 108,000 customers, operates. This office has used its
limited resources to address those marijuana dispensaries that
operate close to schools, parks and playgrounds. As I have said in
the past, this is a non-exclusive list of factors relevant to whether
we should commence civil forfeiture actions against marijuana
properties, and circumstances may require us to address other
situations. I now find the need to consider actions regarding
marijuana superstores such as Harborside. The larger the operation,
the greater the likelihood that there will be abuse of the state’s
medical marijuana laws, and marijuana in the hands of individuals
who do not have a demonstrated medical need. The filing of the
civil forfeiture complaints against the two Harborside properties is
part of our measured effort to address the proliferation of illegal
marijuana businesses in the Northern District of California.”
The Landlord in the San Jose forfeiture, for its part, now claims that even though the lease
openly states Harborside would operate a medical cannabis dispensary, it “mistakenly believed”
until the time the forfeiture action was filed “that one could lawfully operate a medical cannabis
dispensary in the State of California.” Wright Declaration, ¶ 4. The implication of this
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statement—that Landlord was completely unaware of the CSA or that the federal government
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considered cannabis to be a controlled substance—is highly suspect and will be the subject of
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discovery as the forfeiture action proceeds.
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Since being served with the forfeiture, Landlord has had little choice but to buckle to the
the will of the United States and to become its fast friend. Landlord “has committed to take all
reasonable measures to cause Harborside to cease illegal activity at the property.” Wright
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Declaration, ¶ 7. Landlord’s first response to the forfeiture action was to serve on Harborside a
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30 Day Notice to Cure or Quit. This now has been followed by an unlawful detainer lawsuit in
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California Superior Court, County of Santa Clara. Id. Harborside is vigorously contesting the
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unlawful detainer.
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The instant Motion for Preliminary Injunction based on the CSA was filed by Landlord on
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August 29, 2012. The motion contained no evidence or explanation regarding the “likelihood of
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irreparable injury” to Landlord should preliminary injunction be denied, and the matter simply
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proceed to trial as it was instituted—as a civil forfeiture case. Neither did it contain any analysis
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of the Supreme Court’s “traditional four factor test” for injunctive relief.
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The United States, which has now reciprocated its fast friendship with the Landlord, filed
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a “Notice of Joinder” in the Landlord’s motion on September 7, 2012. The United States has
filed no motion of its own, nor submitted any paperwork other than the one-page Notice.
III.
LANDLORD, AS A PRIVATE PARTY, LACKS STANDING TO ENFORCE
THE CONTROLLED SUBSTANCES ACT.
In support of its motion Claimant relies on Supplemental Rule G 7(a) and 21 U.S.C. §
882, a portion of the Federal Controlled Substances Act (“CSA”). While section 882 does confer
jurisdiction upon U.S. District Courts to hear and grant injunctive relief for violations of the CSA,
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Claimant fails in its motion to acknowledge that this injunctive power is reserved solely for the
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executive branch, and cannot be invoked by private parties. In fact, federal courts that have
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examined this issue have overwhelmingly found that private parties lack any standing whatsoever
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to enforce the CSA. See Durr v. Strickland, 602 F.3d 788 (6th Cir. 2010) (adopting lower court
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ruling that no private right of action exists under the CSA); No. 2:10-cv-288, 2010 WL 1610592
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(S.D.Ohio April 15, 2010); see also West v. Ray, WL 3825672 (M.D. Tenn 2010); Jones v.
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Hobbs, 745 F.Supp.2d 886, 890 (E.D. Ark. 2010); McAllister v. Purdue Pharma L.P. 164
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F.Supp.2d 783, 793 n. 16 (S.D.W.Va 2001).2
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In Ringo v. Lombardi, the U.S. District Court for Western Missouri provided one of the
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most in-depth analyses of private rights of action under the CSA. In concluding that the CSA
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provided no right of private enforcement, the court stated, in pertinent part, that:
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“Consideration of the text of the CSA in its entirety indicates that
Congress did not expressly provide a private right of action and did
not intend to imply a private right of action. When a statute
provides specified remedies, courts must use great caution in
expanding its sweep to add unspecified ones. Alexander v.
Sandoval, 532 U.S. 275, 291, 121 S.Ct. 1511, 149 103 L.Ed.2d 539
(1989). The CSA does provide specified remedies. The CSA gives
the Attorney General power to enforce its provisions … The CSA
does not specify a private remedy for those aggrieved by violations
of the CSA …‘Statutes that focus on the person regulated rather
than the individuals protected create no implication of an intent to
confer rights on a particular class of persons.’ [Id. at 289.] Statutes
which focus on the conduct of the persons who are doing the
regulating – rather than those who are regulated or protected – are
even one step further away from creating rights giving rise to
private rights of action. See id. The CSA focuses on administrative
requirements that must be met by those handling drugs, including
issues such as drug classifications and schedules, 21 U.S.C § 811.
Labeling and packaging, 21 U.S.C. § 825, records and reports 21
U.S.C. § 826, and registration. 21 U.S.C. 823. As discussed above,
it also focuses on the conduct of the Attorney General. The CSA
does not focus on the individuals protected by it.”
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Ringo v. Lombardi, 2010 WL 3310240 (W.D. M.O 2010).
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In light of these many precedents, the Court should see Claimant’s motion for what it is –
a naked attempt by a private party to enforce the CSA, a power that is left solely to the executive
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branch. See Jones v. Hobbs, 2010 WL 2985502 (E.D.Ark. 2010) (“to entertain…a cause of
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The U.S. Supreme Court has already determined that the Federal Food, Drugs, and Cosmetics
Act (an act closely analogous to the CSA in its scope purpose and remedies) confers no private
right of action whatsoever, and can only be enforced by the executive branch. See Buckman Co.
v. Plaintiff’s Legal Comm., 531 U.S. 341, 349 (2001).
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action brought by private parties seeking declaration the … CSA has been violated would, in
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effect evade the intent of congress not to create private rights of action under [the] statute and
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would circumvent the discretion entrusted to the executive branch in deciding how and when to
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enforce [the] statutes”).
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In fact, as the Ringo court astutely pointed out “[a]n action based purely on the CSA …
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that would require Defendants to come into compliance with the CSA … amounts to a private
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enforcement action not allowed by the statues.” Ringo v. Lombardi, 2010 WL 3310240 (W.D.
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M.O 2010). Here, though Claimant is seeking an injunction rather than a declaratory judgment,
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because Claimant’s ultimate goal is to require that Harborside remedy alleged violations of the
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CSA and come into compliance, it is doing nothing more than enforcing the act, regardless of
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what Claimant chooses to call its enforcement attempt. Claimant’s acts are thus clearly outside of
the enforcement scheme created by congress and cannot be used to support its request for an
injunction.
Moreover, the U.S. Supreme Court has determined that when Congress decides not to
provide a particular remedy to allegedly aggrieved parties under federal law, then courts are not
free to “supplement” that decision in any manner and cannot “engraft” a remedy on to a statute
that Congress did not intend to provide. California v. Sierra Club, 451 U.S. 287 – 101 (1981).
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Though Supplemental Rule G does allow a court to enjoin alleged criminal activity in forfeiture
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actions, the alleged criminal activity in this case (alleged violations of the CSA) is left entirely
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within the purview of the executive branch to enforce, and thus cannot serve as the basis for
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Claimant’s request under Rule G. Because of this, Claimant lacks the standing necessary to bring
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its request for an injunction against Harborside and the court should deny its request in its
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entirety.3
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IV.
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INJUNCTIONS THAT WOULD ALTER THE STATUS QUO ARE HIGHLY
DISFAVORED.
Both the forfeiture complaint and landlord’s preliminary injunction motion allege that
Harborside has been engaging in medical cannabis sales on the subject property since it began to
lease the premises in June 2011. Thus, this is the status quo ante for purposes of the preliminary
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injunction motion. Under such circumstances, preliminary injunctions are highly disfavored:
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[B]ecause the basic function of a preliminary injunction is to
preserve the status quo pending a determination of the action on the
merits, Chalk v. U.S. Dist. Court, 840 F.2d 701, 704 (9th Cir.1988),
courts generally require a movant to meet a higher degree of
scrutiny where the movant seeks to alter rather than maintain the
status quo, or where issuance of the injunction will provide the
movant with substantially all of the relief that would be available
after a trial on the merits. See Schwarzer, Tashima & Wagstaffe,
Federal Civil Procedure Before Trial (2007) § 13:78 (citing Tom
Doherty Assocs., Inc. v. Saban Entm't, Inc., 60 F.3d 27, 33-34 (2nd
Cir.1995)).
International Church of the Foursquare Gospel v. City of San Leandro,
(N.D. Cal., Oct. 2, 2007, C 07-3605 PJH) 2007 WL 2904046.
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Here, injunctive relief is particularly inappropriate in the pending in rem action for civil
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forfeiture because no party to the case had included such a claim for relief or prayer in any prior
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pleading. Until landlord’s motion was filed, Harborside had been preparing for a trial on the
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merits of the forfeiture complaint—and such preparation continues. However, issuance of the
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Either the United States, the Landlord (or both) may attempt to get around the issue of standing
by arguing that, several days before this Opposition was filed, the United States filed a “Notice of
Joinder” in the Landlord’s motion. Such notice does not rectify the deficiency of Landlord’s lack
of standing. The United States did not file the Motion for Preliminary Injunction. And by no
stretch of logic can the United States “joining” a failed motion somehow change the motion into a
successful one. If the United States, at some later time, sees fit to file its own request for
injunction, that would raise a host of other equitable considerations that would be addressed by
Harborside at the appropriate time. See Liveops, Inc. v. Teleo, Inc., WL 83058 (N.D. Cal. 2006) at
Fn 2 (a joinder merely “adopts the moving papers” of the party that originally filed the motion).
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requested injunction essentially would provide “all of the relief [as against Harborside] that would
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be available after trial on the merits”. If enjoined from all sales of medical cannabis on the
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subject property, it would not be financially viable for Harborside to continue as lessee of the
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premises. Accordingly, under time-honored principles of equity, this Court should refrain from
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issuing the requested injunction, both because it would disrupt the status quo ante and because it
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would shortcut the orderly litigation of the civil forfeiture to provide “all of the relief that would
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be available after trial on the merits.”
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V.
MOVING PARTY HAS NOT MET ITS BURDEN OF SHOWING A
LIKELIHOOD OF IRREPARABLE HARM IF NO PRELIMINARY
INJUNCTION ISSUES AND THE CIVIL FORFEITURE CONTINUES TO BE
LITIGATED ON THE MERITS.
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Landlord cites a single case, U.S. v. Oakland Cannabis Buyer’s Co-op, 532 U.S. 483
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(2001), in support of its motion for preliminary injunction. However, the parties in Oakland
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Cannabis Buyer’s Co-op did not raise, and the Court did not analyze, the issue of what kind of
showing of harm the moving party must demonstrate before the Court may issue a preliminary
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injunction. Nor did Oakland Cannabis Buyer’s Co-op analyze the other equitable factors that are
prerequisites for injunctive relief in all cases. The holding of Oakland Cannabis Buyer’s Co-op
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was extremely narrow: “[W]e hold that medical necessity is not a defense to manufacturing and
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distributing marijuana.” Id. at 494.
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Subsequent to Oakland Cannabis Buyer’s Co-op, the Supreme Court did address the issue
of what showing of “harm” a party moving for a preliminary injunction must make, insofar as it
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held that a “possibility” of harm standard was too lenient even after the moving party had
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demonstrated a strong likelihood of prevailing on the merits. Winters v. Natural Resources
Defense Council, Inc., 555 U.S. 7, 21-22 (2008). Furthermore, recent Ninth Circuit cases make
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clear that “simply because a defendant violates a statute that authorizes injunctive relief”, it does
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not amount to a showing of irreparable harm, and in every case the moving party has an
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affirmative obligation to demonstrate a likelihood of irreparable harm. Such harm is never
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presumed. Park Village Apt. Tenants Ass’n v. Mortimer Howard Trust, 636 F3d 1150, 1162 (9th
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Cir. 2011).
A preliminary injunction is an extraordinary remedy never awarded as of right. Munaf v.
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Geren, 553 U.S. 674, 689-690, 128 S.Ct. 2207, 2218–2219 (2008). A plaintiff seeking a
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preliminary injunction must establish [1] that he is likely to succeed on the merits, [2] that he is
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likely to suffer irreparable harm in the absence of preliminary relief, [3] that the balance of
equities tips in his favor, and [4] that an injunction is in the public interest. Winter v. Natural Res.
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Def. Council, Inc., 555 U.S. 7, 20, 129 S. Ct. 365, 374 (2008); see Munaf, 553 U.S., at 689-690,
128 S.Ct., at 2218–2219. In all cases--including those involving violations of statutes--“[i]t is not
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enough for a court considering a request for injunctive relief to ask whether there is a good reason
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why an injunction should not issue; rather, a court must determine that an injunction should issue
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under the traditional four-factor test set out above.” Monsanto Co. v. Geertson Seed Farms, 130
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S. Ct. 2743, 2757 (2010).
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a. The Moving Party has an Obligation to Show Irreparable Harm. No Such
Harm is Alleged. The Motion Must be Denied Unless Harm is Alleged.
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In Winter, the Supreme Court affirmed its “frequently reiterated standard” that requires
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plaintiffs seeking preliminary relief to demonstrate that irreparable injury is likely in the absence
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of an injunction. Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7, 22, 129 S. Ct. 365, 375,
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(2008). Resolving a conflict among circuits, the Court held that it is never proper for a Court to
issue a preliminary injunction if Plaintiff makes any showing lower than a “likelihood of
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irreparable harm.” The Court stated:
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Issuing a preliminary injunction based only on a possibility of
irreparable harm is inconsistent with our characterization of
injunctive relief as an extraordinary remedy that may only be
awarded upon a clear showing that the plaintiff is entitled to such
relief.
Winter v. Natural Res. Def. Council, Inc., 555 U.S. 7, 22, 129 S. Ct.
365, 375-76 (2008)
See also Stormans, Inc. v. Selecky, 586 F.3d 1109, 1127 (9th Cir. 2009) (“[t]o the extent that our
cases have suggested a lesser standard [than likelihood of irreparable harm], they are no longer
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controlling, or even viable.”); Freedom Holdings, Inc. v. Spitzer, 408 F3d 112, 114 (2nd Cir.
2005) (irreparable injury is “the single most important prerequisite for the issuance of a
preliminary injunction”.)
Following Winter, the Ninth Circuit has also recently reiterated another basic principle
regarding preliminary injunctions: that Courts “’do not presume irreparable harm’ simply because
a defendant violates a statute that authorizes injunctive relief.” Park Vill. Apartment Tenants
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Ass'n v. Mortimer Howard Trust, 636 F.3d 1150, 1162 (9th Cir. 2011) cert. denied, 132 S. Ct. 756
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(U.S. 2011). The Park Village Apartment court overturned a preliminary injunction ordered by
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the federal district court on the ground “that those seeking injunctive relief, not those opposing
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that relief, are responsible for showing irreparable injury.” The Court explained:
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“By examining the legally irrelevant question of whether
Defendants were likely to suffer harm if they were ordered to
execute HAP contracts with the Oakland Housing Authority, the
district court failed to make the essential finding that Plaintiffs are
likely to suffer irreparable harm unless Defendants are ordered to
enter HAP contracts with the Oakland Housing Authority.”
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Under the standards of Winter and progeny, Landlord has not even gotten past the starting
line with respect to its request for preliminary injunction. No theory has been articulated as to
how denial of an injunction would present a “likelihood of irreparable harm” to the Landlord.
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Landlord’s property manager claims in her scant declaration that until the United States filed its
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forfeiture suit, Landlord “mistakenly believed that one could lawfully operate a cannabis
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dispensary in the State of California.” 4 Wright Decl., ¶ 4. Landlord claims that “[s]ince learning
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that Harborside’s activity at the Property violates federal law, [Landlord] has committed to take
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all reasonable measures to cause Harborside to cease illegal activity at the Property.” Wright
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Decl., ¶ 7. In the abstract, this stated goal appears worthy. However, it does not satisfy
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Landlord’s burden of showing a “likelihood of irreparable injury”. This is especially so given the
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fact that Landlord admits it always had “understood” Harborside would continue to use the
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Property to dispense medical cannabis (as the original tenants had done since 2009). Wright
Decl., ¶ 3. No “irreparable harm” has been alleged. Thus, in addition to standing and other
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procedural issues, there are no “equities” that could justify issuing a preliminary injunction.
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VI.
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THE BALANCE OF EQUITIES WEIGHS AGAINST A PRELIMINARY
INJUNCTION.
In each preliminary injunction case, courts “must balance the competing claims of injury
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and must consider the effect on each party of the granting or withholding of the requested relief.”
Amoco Production Co., 480 U.S., at 542, 107 S.Ct. 1396. “In exercising their sound discretion,
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courts of equity should pay particular regard for the public consequences in employing the
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extraordinary remedy of injunction.” Romero–Barcelo, 456 U.S., at 312, 102 S.Ct. 1798; see also
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Railroad Comm'n of Tex. v. Pullman Co., 312 U.S. 496, 500, 61 S.Ct. 643 (1941).
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Because Landlord has not made any showing pertinent to the “likelihood of irreparable
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injury”, it should not be necessary to address the remaining factors of the “traditional four-part
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Harborside intends to take vigorous discovery in the forfeiture action regarding this improbable
claim by Landlord.
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test” for injunctive relief. Nevertheless, Harborside has made a compelling (albeit abbreviated)
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showing that if an injunction were issued, serious economic injury would be sustained because
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each of its twenty employees would be laid off and their salaries (including full medical benefits)
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would be lost. Duarte Decl., ¶ 5. This is not like the Apple v. Samsung case, where the most
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grievous harm Samsung could suffer would be that it would be enjoined from selling several
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products in a well-diversified product line. In contrast, Harborside’s primary reason for existence
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(which was disclosed openly to Landlord) has always been to dispense medical cannabis,
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pursuant to the will of California voters as expressed in the California Compassionate Use Act
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and California Senate Bill 420.
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Thus, the hardship Harborside would suffer as a result of an injunction is formidable. Due
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to the complete lack of evidence submitted by the moving party, Harborside has not gone to great
lengths to compile a tilting-at-windmills-type evidentiary presentation of its own. However,
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should the Court be inclined to fully “balance of hardships” involved in issuing an injunction,
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Harborside would request an evidentiary hearing at a future date, following further briefing by all
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parties.
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OAKLAND CANNABIS BUYER’S PROVIDES NO PRECEDENT, NOR
ANYJUSTIFICATION, FOR TRANSFORMING AN IN REM CIVIL
FORFEITURE INTO AN ACTION FOR INJUNCTION.
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In its moving papers, Landlord attempts to liken this case to Oakland Cannabis Buyer’s
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VII.
Co-op on the ground that in both “criminal enforcement of the CSA is certainly an alternative
means of ensuring compliance with the statute.” Motion, 6:26-27. However, to Defendant’s
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knowledge, the CSA injunctive provision has never been employed before in a civil forfeiture
action, and this is not a use contemplated by Congress. Moreover, Landlord’s comparison
disguises a crucial, yet obvious distinction between Oakland Cannabis Buyer’s Co-op and this
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case that strongly militates against issuance of the requested injunction here.
Oakland Cannabis Buyer’s Co-op, from the day it was filed, was always an action by the
United States “seeking to enjoin the Cooperative from distributing and manufacturing marijuana.”
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Oakland Cannabis Buyer’s Co-op, supra, 121 S.Ct. at 1715. Therefore, after the Supreme Court
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had issued its decision and [District Court] Judge Breyer was in a position to rule on the United
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States’ motion for permanent injunction, the District Court’s only options were 1) issuing the
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injunction; 2) declining to issue the injunction on the basis that the United States should file
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criminal charges against the Defendant dispensaries instead; or 3) not enforcing the CSA at all.
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proceeding. U.S. v. Cannabis Cultivator's Club (N.D. Cal., June 10, 2002, C 98-00085 CRB)
2002 WL 1310460. Option 3 (non-enforcement of the CSA) was not acceptable to Judge Breyer.
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(“This Court cannot decline to issue the injunction in favor of non-enforcement of the statute.”)
Moreover, at least one defendant conceded that they preferred that the District Court proceed with
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the injunction rather than criminal prosecution. Id. Thus, the District Court had no viable
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alternative to issuing the requested injunction.
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Here, in sharp contrast, this Court's "Option 4" is simply to proceed with the property
forfeiture—which was of course the type of action the United States chose to file in the first
place. If the forfeiture action proceeds to trial and the Government prevails against Harborside, it
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would have the identical effect of enforcing the CSA, with respect to the subject property, that
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that an injunction would have. Furthermore, the forfeiture context allows the Court to consider a
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different set of procedures, safeguards and equitable standards, including, as just one example, the
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effect of the Eighth Amendment Excessive Fines Clause after balancing the “gravity of the harm”
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posed by the Defendant. See United States v. Ferro, 681 F.3d 1105, 1115 – 1118 (9th Cir. 2012).
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The Court should therefore deny this motion and thereby retain the status quo pending orderly
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adjudication of the forfeiture action. This would be consistent with the principles of Oakland
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Cannabis Buyer’s Co-op, but would also give due consideration to the unique procedural context
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of this forfeiture case.
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VIII. CONCLUSION
For all of the foregoing reasons, Claimant Harborside Health Center requests that the
Court deny the instant motion for preliminary injunction in favor of permitting this civil forfeiture
case to be decided on the merits. In the alternative, if moving party (in its reply papers or
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otherwise) makes an evidentiary showing regarding the equitable factors pertinent to an
injunction decision, Harborside would request that a new briefing schedule and new hearing date
be assigned so that there is fair opportunity for Harborside to rebut the evidence.
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Dated: September 12 , 2012
HENRY G. WYKOWSKI & ASSOCIATES
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By:
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/s/ Henry G. Wykowski
HENRY G. WYKOWSKI
Attorneys for Claimant
PATIENTS MUTUAL ASSISTANCE
COLLECTIVE and SAN JOSE WELLNESS
dba HARBORSIDE HEALTH CENTER
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CERTIFICATE OF SERVICE
I certify that copies of the above document was served electronically on September 12,
2012 on counsel of record in compliance with Federal Rule of Civil Procedure 5 and the local
rules of the Northern District, by use of the Court’s ECF system.
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/s/ Henry G. Wykowski
Henry G. Wykowski
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CLAIMANT HARBORSIDE’S OPPOSITION TO MOTION FOR ORDER
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