Before the Court is the defendants’ motion to dismiss the Municipality of San Sebastian’s amended complaint for lack of standing, (Docket No. 11), which the Municipality opposes, (Docket No. 15). The matter was referred to Magistrate Judge Justo Arenas, (Docket No. 19), who issued a Report and Recommendation recoim mending that the motion be granted, (Docket No. 21). The Municipality objects to the magistrate judge’s recommendation. (Docket No. 23.) For the reasons that follow, the Court adopts the magistrate judge’s Report and Recommendation in part and rejects it in part. The defendants’ motion to dismiss, (Docket No. 11), is GRANTED IN PART AND DENIED IN PART.
BACKGROUND
Plaintiff, the Municipality of San Sebastian (the “Municipality”), brought this action against the Commonwealth of Puerto Rico, Governor Alejandro Garcia-Padilla (“Governor Garcia”) in his official capacity, and Secretary of Labor Vance Thomas (“Secretary Thomas”) in his official capacity (collectively, “defendants”), alleging political discrimination in the distribution of funds used to combat unemployment. (Docket Nos. 1, 9.) The amended complaint, brought pursuant to 42 U.S.C. § 1983, includes claims for violations of the First and Fourteenth Amendments of the United States Constitution as well as pendent claims arising under the Puerto Rico Constitution. (Docket No. 9 at § IV.)
According to the Municipality, the Commonwealth created the Employment Opportunities Development Fund, or Law 52 of August 9, 1991 (“Law 52”), to combat unemployment in Puerto Rico. Docket No. 9 at ¶ 9; see P.R. Laws Ann. tit. 29, § 711c (creating fund to be administered by the Department of Labor and Human Resources); see also Gomez v. Rivera Rodriguez,
Each year, for the past ten years, the Municipality of San Sebastian has received an average of $300,000 in Law 52 funds to help reduce its unemployment rate, which is approximately 17.9% of its 42,430 citizens. (Docket No. 9 at ¶ 9.) For the 2013-14 fiscal year (“FY 2013-14”), under Governor Garcia’s administration, however, the Municipality of San Sebastian received only $70,000. Id. at ¶ 10. The Municipality alleges that the Department of Labor, through Secretary Thomas, assigned less funds to San Sebastian because its mayor is a member of the New Progressive Party (“NPP”) — an opposing political party to that of Governor Garcia, who is a member of the Popular Democratic Party (“PDP”). Id. According to the Municipality, NPP-led municipalities like San Sebastian received lesser Law 52 allotments than PDP-led municipalities, even where the latter had lower unemployment levels and smaller populations. Id. As an example, the Municipality points to Rincon, a PDP-led municipality that received $176,998.13 in FY 2013-14 despite having a lower unemployment rate (15.7% versus 17.9%) and fewer citizens (15,200 versus 42,430), Rincon received over $100,000 more than San Sebastian in Law 52 funds. See id. The amended complaint thus alleges that the Commonwealth, Governor Garcia, and Secretary Thomas discriminated politically against the Municipality of San Sebastian.
“As frequently happens with such disputes in Puerto Rico, the matter was brought to federal court.” Torres Rivera v. Calderon Serra,
The amended complaint alleges that the defendants’ actions are “politically motivated” and “have no relation to the purposes-of Law 52,” and that they “were made under color of state law,” in violation of 42 U.S.C. § .1983. (Docket No. 9 at ¶ 11.) The Municipality bases its political discrimination claim on the due process and equal protection clauses of both the United States and Puerto Rico constitutions as well as the First Amendment of the United States Constitution. Id. at § IV. The amended complaint seeks the following remedies: (1) a determination from the Court acknowledging that the defendants have politically discriminated against the Municipality; (2) a permanent injunction prohibiting the defendants from doing so again in the future; (3) an order compelling the defendants to provide the Municipality each year with the same amount of annual Law 52 funds that it received in previous years ($300,000); (4) reasonable attorneys fees pursuant to 42 U.S.C. § 1988; and (5) other equitable relief that the Court may deem proper. Id. at ¶¶ 29-33.
On June 6, 2014, the defendants filed a motion to dismiss the Municipality’s amended complaint pursuant to Federal Rule of Civil Procedure 12(b)(1). (Docket No. 11.) The defendants’ motion argues that the Municipality lacks standing to bring a cause of action under section 1983 because “[section 1983] was not designed to allow political sub-divisions of the state — including Puerto Rican municipalities — [to] seek[] redress in federal court for alleged discriminatory actions effectuated by their state.” Id. at p. 3. The defendants reason that, according to Supreme Court jurisprudence, “[section] 1983 was intended to help citizens seek federal court intervention from what amounts to illegal actions performed by state or municipal government agents under color of law — not for local governments themselves to instigate federal causes of action against the state or state entities.” Id. In sum, the defendants argue that the Municipality is not a proper section 1983 plaintiff: although section 1983 allows political subdivisions to be sued in a section 1983 suit, it does not permit political subdivisions to sue under the statute. See id. at pp. 3, 7-14. This position, the defendants contend, is consistent with the holdings of several federal courts in other circuits. Id. at pp. 3, 9-11.
On July 7, 2014, the Municipality filed its opposition to the defendants’ motion to dismiss. (Docket No. 15.) According to the Municipality, the defendants’ motion raises two distinct questions: (1) whether the Municipality has standing; and, if it does, (2) whether the Municipality’s allegations, if proven true, entitle it to a remedy. Id. at ¶ 8. Regarding the first question, the Municipality argues that it has standing pursuant to Santiago Collazo v. Franqui Acosta,
REPORT AND RECOMMENDATION
On July 22, 2014, the Court referred the defendants’ motion to dismiss to Magistrate Judge Justo Arenas for a report and recommendation. (Docket No. 19.) On August 26, 2014, Judge Arenas recommended, that the defendants’ motion be granted. (Docket No. 21.) The magistrate judge determined that “the Municipality may allege an injury in fact caused to it by the [defendants],” a prerequisite to standing, only if the Municipality is a “person ... in terms of those who could make a [section 1983] claim against violations under color of state law.” Id. at p. 7. Upon reviewing the applicable case law, the magistrate judge found more persuasive the holding of other federal courts that a municipality is not a proper section 1983 plaintiff, eschewing the Municipality’s reliance on Santiago. Id. at pp. 8-10. The magistrate judge also found that the Municipality had not specified how it was adversely affected by the reduction of funds. Id. at p. 10. The magistrate judge concluded that dismissal was warranted because the Municipality is not'empowered to seek redress pursuant to section 1983. Id. at p. 12.
On September 9, 2014, the Municipality objected to the magistrate judge’s report and recommendation. (Docket No. 23.) The Municipality’s objection to the magistrate judge’s report and recommendation largely rehashes the arguments made in its opposition to the defendants’ motion to dismiss. Compare Docket No. 15 at ¶¶ 8-12, with Docket No. 23 at ¶¶ 8-11. Namely, the Municipality raises an objection as to the applicability of Santiago. See Docket No. 23 at ¶ 11.
After making an independent examination of the record and reviewing the governing jurisprudence, the Court agrees with the Municipality that the issue of standing is distinct from the issue of section 1983 personhood. See Docket No. 15 at ¶ 8. The Court also agrees with the Municipality that Santiago governs the defendants’ motion. See id. at ¶ 12. Accordingly, the Court declines to follow the magistrate judge’s analysis. As discussed below, the Court adopts in part the magistrate judge’s recommendation for dismissal, (Docket No. 23), albeit on different footing, and rejects it in part.
STANDARDS OF REVIEW
28 U.S.C. § 636(b)(1)
A district court may refer a dispositive motion to a magistrate judge for a report and recommendation. 28 U.S.C. § 636(b)(1)(B); see also Fed.R.Civ.P. 72(b); Loe. Civ. R. 72(b). A party adversely affected may file written objections within fourteen days of being served with the report and recommendation. See Fed. R.Civ.P. 72(b)(2); Loe. Civ. R. 72(d). A party that timely objects is entitled to a de novo determination of those portions of the report or recommendation to which specific objection is made. United States v. Mercado-Canizares,
Rule 12(b)(1) provides that a defendant may move to dismiss an action for lack of subject-matter jurisdiction. Fed. R.Civ.P. 12(b)(1). A motion to dismiss for lack of standing is properly understood as a challenge to the reviewing court’s subject-matter jurisdiction. See United Seniors Ass’n., Inc. v. Philip Morris USA,
As courts of limited jurisdiction, federal courts narrowly construe jurisdictional grants. Padilla-Mangual v. Pavia Hosp.,
ANALYSIS
In support of their motion to dismiss for lack of subject-matter jurisdiction, the defendants argue that the Municipality “lacks standing to bring forth a cause of action under [section] 1983 since it is a municipality and [section 1983] was not designed to allow political sub-divisions of the state ... [to] seek[ ] redress in federal court for alleged discriminatory actions effectuated by their state.” (Docket No. 11 at p. 3.) The defendants’ motion, however, conflates the concept of standing with that of a cause of action: “standing is a question of whether a plaintiff is sufficiently adversary to a defendant to create an Article] III case or controversy, or at least to overcome prudential limitations on federal-court jurisdiction,” whereas “cause of action is a question of whether a particular plaintiff is a member of the class of litigants that may, as a matter of law, appropriately invoke the power of the court.” See Davis v. Passman,
To the extent the defendants’ motion questions whether a municipality is a “citizen” or “other person” for purposes,of section 1983, the defendants raise an argument for dismissal apart from the issue of standing. See Santiago,
Accordingly, the Court will first address the threshold issue of standing and then turn to the issue of whether the Municipality is a proper section 1983 plaintiff.
Constitutional Standing
The necessity to establish standing is rooted in the case or controversy requirement of the Constitution. See U.S. Const, art. Ill, § 2. Article III restricts a federal court’s jurisdiction to actual cases and controversies. Id. An actual “case or controversy” exists when “the party seeking to invoke the court’s jurisdiction (normally, the plaintiff) has a ‘personal stake in the outcome’ of the claim asserted.” Pagan v. Calderon,
The first element of Article III standing is “injury in fact.” An “injury in fact” is one that is “concrete and particularized, on the one hand, and actual or imminent (as opposed to conjectural or hypothetical), on the other hand.” Pagan,
In addition to these Article III prerequisites, prudential concerns ordinarily require a plaintiff to show: (1) that her claim is premised on her own legal rights (as opposed to those of a third party); (2) that her claim is not merely a generalized grievance; and (3) that her claim falls within the zone of interests protected by the law invoked. Pagan,
Although their motion includes the above principles, (Docket No. 11 at pp. 6-7), the defendants do not substantively raise any arguments as to the Municipality’s standing, devoting their attention instead to a discussion of the purpose and scope of section-1983. The Municipality argues that it has standing pursuant to Santiago Collazo v. Franqui Acosta,
The Santiago plaintiffs — the Municipality of Vieques, its mayor (in both her personal and official capacities), and.several citizens — brought a section 1983 action
[The] alleged economic loss clearly constitutes a “threatened or actual injury.” “These palpable economic injuries have long been recognized as sufficient to lay the basis for standing.” Sierra Club v. Morton,405 U.S. 727 , 733,92 S.Ct. 1361 ,31 L.Ed.2d 636 (1972). Discrimination on the basis of the political affiliation of the municipal administration, within the “zone of interests” protected by the [FJirst [A]mendment, is alleged as the cause of the injury, thus making it “fairly” traceable to the challenged action. This Court could enjoin future discrimination, should it be proper, which would provide plaintiff a remedy. Moreover, the municipality requests a money judgment against defendants in their personal capacities for the past harm caused by their alleged actions. For this, standing is clear. Therefore, the municipality ... has standing to litigate its claims.
Santiago,
The Court finds that the Santiago reasoning to apply squarely here, where the almost exact allegations have been brought forth.
Accordingly, the Municipality has standing to litigate its claims.
Although framed as a motion to dismiss for lack of standing, the defendants’ motion in substance argues that the Municipality has no cause of action pursuant to section 1983. See Docket No. 11 at pp. 7-14. Section 1988 provides:
Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory or the District of Columbia, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress.
42 U.S.C. § 1983 (emphasis added). The defendants argue that the Municipality is not a “citizen of the United States or other person within the jurisdiction thereof’ for the purposes of instituting a section 1983 action. See, e.g., Docket No. 11 at p. 13 (“[T]he Municipality does not have a cognizable [section] 1983 claim since it cannot be a party plaintiff in such actions.”). While acknowledging that this Court in Santiago 'held that a municipality is an “other person” within section 1983 and may bring suit under that statute, the defendants argue that Santiago “has not been followed by any other district court and various circuit and district courts have expressly rejected [its reasoning].” See Docket No. 11 at 9.
In 1961, the Supreme Court held that municipalities are not “persons” liable within the ambit of section 1983. Monroe v. Pape,
Since Monell, the courts of appeals have been divided as to whether a municipality is a proper section 1983 plaintiff. On one hand, the Eleventh Circuit held that municipalities cannot bring section 1983 suit, following the Fifth Circuit’s reasoning. Randolph Cnty. v. Alabama Power Co.,
In Santiago, this Court found the Sixth Circuit Court of Appeals’ reasoning to be the most persuasive and held that the plaintiff municipality was an “other person” within section 1983.
In harmony with Santiago, the Court holds that the Municipality of San Sebastian is an “other person” within section 1983 and is entitled to bring suit pursuant to that statute.
The Municipality’s Right to Sue the State
The resolution of the issue of whether the Municipality is an “other person,’’ however, does not end the Court’s analysis. The defendants cite several cases to the effect that, in general, municipalities cannot sue their parent states. (Docket No. 11 at pp. 11-13.) While the defendants are correct that this is often the case, “it is neither an exception to [section] 1983, to standing doctrines, nor a general principle in itself’ that warrants this outcome, “but rather it is the effect of provisions of substantive law.” Santiago,
The Municipality alleges political discrimination in violation of the due process and equal protection clauses of the Fourteenth Amendment as well as the First Amendment of the United States Constitution. (Docket No. 9 at § IV.A-C.) A state, however, “is not bound by substantive fourteenth amendment limitations (due process and equal protection) when dealing with its municipalities.” Santiago,
Nevertheless, political subdivisions can sue their states for constitutional violations when the right asserted is protected. See Santiago,
The defendants argue that “[o]nce [the] claims conferring federal jurisdiction are dismissed from this case ..., the Court should exercise its discretion and dismiss the supplemental state-law claims arising under Puerto Rico law.” (Docket No. 11 at p. 14.) Defendants apparently rely upon 28 U.S.C. § 1367(c)(3), which gives a district court not sitting in diversity the discretion to dismiss a plaintiffs supplemental state claims once it has dismissed all federal claims brought by that plaintiff. See Marrero-Gutierrez v. Molina,
In addition to its federal constitutional claims, the Municipality alleges political discrimination in violation of the due process and equal protection clauses of the Puerto Rico Constitution. (Docket No. 9 at § IV.D-E.) A federal court exercising original jurisdiction may assert supplemental jurisdiction over state law claims “that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy.” 28 U.S.C. § 1367(a); see Ortiz-Bonilla v. Federacion de Ajedrez de Puerto Rico, Inc.,
Having rejected the defendants’ only proffered ground for dismissal of the Municipality’s Puerto Rico constitutional claims, and having exercised its discretion to assert supplemental jurisdiction over these claims, the Court declines to dismiss the fourth and fifth causes of action. (Docket No. 9 at § IV.D-E.)
CONCLUSION
For the reasons discussed above, the defendants’ motion to dismiss, (Docket No. 11), is GRANTED IN PART AND DENIED IN PART. To the extent the defendants’ motion pertains to the Municipality’s claims for violations of the due process and equal protection clauses of the federal Constitution, (Docket No. 9 at § IV.A-B), the defendants’ motion, (Docket No. 11), is GRANTED. The federal due process and equal protection causes of action are, therefore, DISMISSED WITH PREJUDICE. To the extent the defendants’ motion pertains to the Municipality’s federal First Amendment claim and its supplemental claims for due process and equal protection clauses of the Puerto Rico Constitution, (Docket No. 9 at § IV.C-E), the defendants’ motion is DENIED.
IT IS SO ORDERED.
Notes
. The analytical lens through, which a court reviews a Rule 12(b)(1) motion is, thus, nearly identical to that employed on a Rule 12(b)(6) motion. See Arroyo v. FDIC,
. Addressing the same issue in Municipality of San Juan v. Calderon, No. CIV. 04-1727(JP),
. Compare S. Macomb,