United States District Court, D. Maryland
Lipton Hollander United States District Judge
Daimler Trust and Daimler Title Company (“Daimler
Title”) filed suit on February 25, 2016, against
defendant Prestige Annapolis, LLC (“Prestige”),
to obtain possession of a 2016 Mercedes-Benz. ECF 1. The
Complaint, which is supported by two exhibits (filed
collectively as ECF 1-2), contains five counts: violation of
plaintiffs’ due process rights under the Fourteenth
Amendment, pursuant to 42 U.S.C. § 1983 (“§
1983”) (Count I); replevin (Count II); deprivation of
property without due process of law, in violation of Article
24 of the Maryland Declaration of Rights (Count III);
conversion (Count IV); and Declaratory Relief (Count V).
Id. ¶¶ 44-106. Plaintiffs also rely on 42
U.S.C. § 1988 (“§ 1988”). They allege
that this Court has federal question jurisdiction under 28
U.S.C. § 1331 and diversity jurisdiction pursuant to 28
U.S.C. § 1332. Id. ¶¶
to Fed.R.Civ.P. 12(b)(1), 12(b)(2), and 12(b)(6), Prestige
has filed a “Motion to Dismiss and Incorporated
Memorandum of Law” (ECF 13, the “Motion”),
which challenges, inter alia, the Court’s
subject matter jurisdiction. Plaintiffs oppose the Motion.
ECF 15 (“Opposition”). Prestige has not replied
and the time to do so has expired. See Local Rule
March 16, 2016, plaintiffs filed a “Motion to Release
Motor Vehicle Upon Court Approval of Bond and Request for
Issuance of Show Cause Order.” ECF 9. I issued the
requested “Order to Show Cause” on March 28,
2016. ECF 12. Prestige responded on April 29, 2016 (ECF 22),
seeking to dissolve the show cause order. By Order of May 9,
2016 (ECF 23), I postponed the show cause hearing and
directed plaintiffs to submit further briefing as to the
propriety of holding a show cause hearing in federal court
under § 16-206 of the Commercial Law Article of the
Maryland Code (2013 Repl. Vol., 2015 Supp.). Plaintiffs
subsequently filed a “Reply Memorandum of Law in
Further Support of Motion to Release Motor Vehicle Upon Court
Approval of Bond” (ECF 24), which advances additional
arguments in opposition to the Motion.
hearing is necessary to resolve the Motion. See
Local Rule 105.6. For the reasons that follow, I will grant
the Motion as to Count I and Count III and deny it in all
April 25, 2015, William Betteridge leased a silver, two-door
2016 Mercedes Benz AMG GT S (the “Vehicle”) from
an automobile dealership in Annapolis, Maryland, pursuant to
a closed-end lease agreement (the “Lease
Agreement”). ECF 1 ¶ 19; ECF 1-2 at 1-2. The
lessee has failed to make monthly lease payments since
September 18, 2015. ECF 1 ¶ 24. Plaintiffs maintain that
the Vehicle is currently worth $137, 576. ECF 1 ¶¶
to the Vehicle was issued on June 2, 2015, and is held by
Daimler Trust as owner. ECF 1 ¶¶ 21, 22. Plaintiffs
allege that “[t]he Lease Agreement was assigned to and
became the property of Daimler Trust, and as part of the
transaction Daimler Title Co. obtained a lien” on the
Vehicle. Id. ¶ 20. Daimler Title has held the
first priority lien on the Vehicle since June 2, 2015.
Id. ¶ 23.
Trust is a Delaware Trust, whose trustee, BNY Mellon Bank of
Delaware, is a Delaware banking corporation. The sole
beneficiary of Daimler Trust is Daimler Trust Holding LLC,
whose sole member is Mercedes-Benz Financial Services USA
LLC, whose sole member is Daimler Investments U.S.
Corporation, a Delaware Corporation.” ECF 11 at 2;
see also ECF 1 ¶ 7. Daimler Title is “a
corporation organized and existing by virtue of the laws of
the State of Delaware . . . .” ECF 1 ¶ 8.
contend that Prestige is currently “in control”
of the Vehicle. Id. ¶ 9. According to
plaintiffs’ supplemental briefing (ECF 11 at 2),
Prestige “is a Limited Liability Company organized
under the laws of Maryland, with a principal place of
business in Maryland, and a registered agent in Maryland.
Public records indicate Prestige’s sole member is Omid
Shaffaat, and public records indicate Mr. Shaffaat is a
Maryland resident.” Plaintiffs maintain that Prestige
made “modifications to make the vehicle a racing-type
car.” ECF 1 ¶ 32. According to plaintiffs,
“Daimler Trust and Daimler Title Co. did not grant
permission, consent or authority for any racing-type or any
other modifications to be done” to the Vehicle.
Id. ¶ 31. An invoice from Prestige in
Betteridge’s name, dated December 22, 2015, reflects a
“TOTAL AMOUNT DUE” from Betteridge to Prestige of
$11, 730. ECF 1-2 at 1. According to plaintiffs, the
“charges were not for repair” to the Vehicle, but
rather for the modifications made to it. ECF 1 ¶ 32.
noted, Betteridge, the lessee of the Vehicle, made no lease
payments after September 18, 2015, and is in default of the
Lease Agreement. Id. ¶ 24. On November 20,
2015, an individual identifying himself as Betteridge’s
father notified Daimler Trust that Betteridge could no longer
pay the lease payments and would return the Vehicle.
Id. ¶ 25. On December 1, 2015, the same
individual notified Daimler Trust that the Vehicle was in
Prestige’s possession. Id. ¶ 26. On
December 4, 2015, Betteridge “telephoned Daimler
Trust’s representative to advise that Prestige would
return the vehicle . . . .” Id. ¶ 27.
allege that they negotiated unsuccessfully with Prestige for
the return of the Vehicle. See Id. ¶¶
28-35. Plaintiffs assert, id. ¶ 36: “On
January 8, 2016, and without notice to Daimler Trust or
Daimler Title Co., Prestige requested that a lien company
named Nationwide Lien & Recovery, Inc. enforce a lien
against [the Vehicle] in the amount of $49, 084.00.”
Further, plaintiffs aver, ECF 1 ¶ 37:
“Prestige’s act of raising its lien demand from
$11, 730.00 to $49, 084.00 was done without the knowledge,
consent or authority” of the plaintiffs. Plaintiffs
also allege, id. ¶ 38: “Prestige then
served a Notice of Sale on the Lessee asserting that [the
Vehicle] would be auctioned on March 2, 2016 pursuant to
state law in order to enforce a lien claim of $50,
534.00.” See ECF 1-2 at 2, “Notice of
Sale of Motor Vehicle to Satisfy a Lien.”
to plaintiffs, “Prestige invoked the power of the State
of Maryland to impress a nonconsensual (supposed) lien for
$50, 534.00 in charges for unauthorized . . .
modifications” to the Vehicle. ECF 1 ¶ 11. And, it
did so without affording plaintiffs notice and a hearing to
protect their interests by contesting the validity of
Prestige’s claims. Id. ¶ 15. Plaintiffs
contend, id. ¶ 39: “Prior to impressing a
purported lien for $11, 730.00, and prior to increasing that
lien claim to $49, 084.00 and again to $50, 534.00, Prestige
had not provided any hearing before an impartial
decisionmaker, with adequate notice . . . .” See
also Id. ¶ 15.
Standard of Review
discussed, the Motion (ECF 13) is premised on Fed.R.Civ.P.
Fed.R.Civ.P. 12(b)(1), a motion to dismiss for lack of
subject matter jurisdiction raises the issue of
“whether the court has the competence or authority to
hear and decide the case.” Davis v. Thompson,
367 F.Supp.2d 792, 799 (D. Md. 2005). The question of subject
matter jurisdiction may be raised by the parties or the
court, sua sponte, at any stage of the litigation.
Arbaugh v. Y & H Corp., 546 U.S. 500, 506
(2006); see Ellenburg v. Spartan Motors Chassis,
Inc., 519 F.3d 192, 197 (4th Cir. 2008). Upon a
challenge to subject matter jurisdiction, the plaintiff bears
the burden of proving, by a preponderance of evidence, the
existence of jurisdiction. Robb Evans & Assocs., LLC
v. Holibaugh, 609 F.3d 359, 362 (4th Cir. 2010);
Evans v. B.F. Perkins Co., 166 F.3d 642, 647 (4th
Cir. 1999); see also United States ex. rel. Vuyyuru v.
Jadhau, 555 F.3d 337, 347 (4th Cir. 2009), cert. denied,
558 U.S. 875 (2009); cf. Zoroastrian Ctr. & Darb-E-Mehr
of Metro. Washington, D.C. v. Rustam Guiv Found. of New
York, __F.3d __, 2016 WL 2343251, at *5 (4th Cir. May 4,
courts are courts of limited jurisdiction and “may not
exercise jurisdiction absent a statutory basis.”
Exxon Mobil Corp. v. Allapattah Servs., Inc., 545
U.S. 546, 552 (2005). They “have an independent
obligation to determine whether subject-matter jurisdiction
exists, even when no party challenges it.” Hertz
Corp. v. Friend, 559 U.S. 77, 94 (2010).
challenge to subject matter jurisdiction under Rule 12(b)(1)
may proceed “in one of two ways”: either a facial
challenge, asserting that the allegations pleaded in the
complaint are insufficient to establish subject matter
jurisdiction, or a factual challenge, asserting
“‘that the jurisdictional allegations of the
complaint [are] not true.’” Kerns v. United
States, 585 F.3d 187, 192 (4th Cir. 2009)(citation
omitted); see also Buchanan v. Consol. Stores Corp.,
125 F.Supp.2d 730, 736 (D. Md. 2001). In a facial challenge,
“the facts alleged in the complaint are taken as true,
and the motion must be denied if the complaint alleges
sufficient facts to invoke subject matter
jurisdiction.” Kerns, 585 F.3d at 192; see also
Ibarra v. United States, 120 F.3d 472, 474 (4th Cir.
factual challenge, on the other hand, “the district
court is entitled to decide disputed issues of fact with
respect to subject matter jurisdiction.” Kerns, 585
F.3d at 192. In that circumstance, the court “may
regard the pleadings as mere evidence on the issue and may
consider evidence outside the pleadings without converting
the proceeding to one for summary judgment. Velasco v.
Gov’t of Indonesia, 370 F.3d 392, 398 (4th Cir.
2004); Evans, 166 F.3d at 647. That is, “the court may
look beyond the pleadings and ‘the jurisdictional
allegations of the complaint and view whatever evidence has
been submitted on the issue to determine whether in fact
subject matter jurisdiction exists.” Khoury v.
Meserve, 268 F.Supp.2d 600, 606 (D. Md. 2003) (citation
omitted), aff’d, 85 Fed.Appx. 960 (4th Cir. 2004).
Prestige raises a facial challenge in that it asserts that
the allegations pleaded in the Complaint are insufficient to
establish subject matter jurisdiction. Under the
“well-pleaded complaint” rule, the facts showing
the existence of subject matter jurisdiction “must be
affirmatively alleged in the complaint.” Pinkley,
Inc. v. City of Frederick, 191 F.3d 394, 399 (4th Cir.
1999) (citing McNutt v. Gen’l Motors Acceptance
Corp., 298 U.S. 178 (1936)). “A court is to
presume, therefore, that a case lies outside its limited
jurisdiction unless and until jurisdiction has been shown to
be proper.” United States v. Poole, 531 F.3d
263, 274 (4th Cir. 2008) (citing Kokkonen v. Guardian
Life Ins. Co., 511 U.S. 375, 377 (1994)).
defendant may test the legal sufficiency of a complaint by
way of a motion to dismiss under Rule 12(b)(6). Goines v.
Valley Cmty. Servs. Bd., __F.3d __, 2016 WL 2621262, at
*3 (4th Cir. May 9, 2016); McBurney v. Cuccinelli,
616 F.3d 393, 408 (4th Cir. 2010), aff’d sub nom.
McBurney v. Young, __U.S. __, 133 S.Ct. 1709 (2013);
Edwards v. City of Goldsboro, 178 F.3d 231, 243 (4th
Cir. 1999). A Rule 12(b)(6) motion constitutes an assertion
by a defendant that, even if the facts alleged by a plaintiff
are true, the complaint fails as a matter of law “to
state a claim upon which relief can be granted.”
Whether a complaint states a claim for relief is assessed by
reference to the pleading requirements of Fed.R.Civ.P.
8(a)(2). It provides that a complaint must contain a
“short and plain statement of the claim showing that
the pleader is entitled to relief.” The purpose of the
rule is to provide the defendant with “fair
notice” of the claim and the “grounds” for
entitlement to relief. Bell Atl. Corp. v. Twombly,
550 U.S. 544, 555-56 (2007).
survive a motion under Fed.R.Civ.P. 12(b)(6), a complaint
must contain facts sufficient to “state a claim to
relief that is plausible on its face.” Id. at
570; see Ashcroft v. Iqbal, 556 U.S. 662, 684 (2009)
(“Our decision in Twombly expounded the pleading
standard for ‘all civil actions’ . . . .”
(citation omitted)); see also Simmons v. United Mortg.
& Loan Inv., LLC, 634 F.3d 754, 768 (4th Cir. 2011).
But, a plaintiff need not include “detailed factual
allegations” in order to satisfy Rule 8(a)(2). Twombly,
550 U.S. at 555. Moreover, federal pleading rules “do
not countenance dismissal of a complaint for imperfect
statement of the legal theory supporting the claim
asserted.” Johnson v. City of Shelby, __U.S.
__, 135 S.Ct. 346, 346 (2014) (per curiam).
the rule demands more than bald accusations or mere
speculation. Twombly, 550 U.S. at 555; see
Painter’s Mill Grille, LLC v. Brown, 716 F.3d
342, 350 (4th Cir. 2013). A complaint is insufficient if it
provides no more than “labels and conclusions, ”
or “a formulaic recitation of the elements of a cause
of action, ” is insufficient. Twombly, 550 U.S. at 555.
satisfy the minimal requirements of Rule 8(a)(2), the
complaint must set forth “enough factual matter (taken
as true) to suggest” a cognizable cause of action,
“even if . . . [the] actual proof of those facts is
improbable and . . . recovery is very remote and
unlikely.” Twombly, 550 U.S. at 556 (internal
quotations omitted). Put another way, in reviewing a Rule
12(b)(6) motion, a court “‘must accept as true
all of the factual allegations contained in the complaint,
’” and must “‘draw all reasonable
inferences [from those facts] in favor of the
plaintiff.’” E.I. du Pont de Nemours &
Co. v. Kolon Indus., Inc., 637 F.3d 435, 440 (4th Cir.
2011) (citations omitted); see Houck v. Substitute Tr.
Servs., Inc., 791 F.3d 473, 484 (4th Cir. 2015);
Kendall v. Balcerzak, 650 F.3d 515, 522 (4th Cir.
2011), cert. denied, __U.S. __, 132 S.Ct. 402 (2011);
Monroe v. City of Charlottesville, 579 F.3d 380,
385-86 (4th Cir. 2009), cert. denied, 559 U.S. 992 (2010).
But, a court is not required to accept legal conclusions
drawn from the facts. See Papasan v. Allain, 478
U.S. 265, 286 (1986). “A court decides whether [the
pleading] standard is met by separating the legal conclusions
from the factual allegations, assuming the truth of only the
factual allegations, and then determining whether those
allegations allow the court to reasonably infer” that
the plaintiff is entitled to the legal remedy sought. A
Society Without A Name v. Virginia, 655 F.3d 342, 346
(4th Cir. 2011), cert. denied, __U.S. __, 132 S.Ct. 1960
motion asserting failure to state a claim typically
“does not resolve contests surrounding the facts, the
merits of a claim, or the applicability of defenses.”
Edwards, 178 F.3d at 243 (quotation marks omitted); see
Houck, 791 F.3d at 484; Tobey v. James, 706 F.3d
379, 387 (4th Cir. 2013). But, “if all facts necessary
to the affirmative defense ‘clearly appear on the
face of the complaint, ’” or in other material
that is the proper subject of consideration under Rule
12(b)(6), such a defense can be resolved on the basis of the
facts alleged in the complaint. Goodman v. Praxair,
Inc., 494 F.3d 458, 464 (4th Cir. 2007) (en banc)
(citation omitted) (emphasis in Goodman); see Houck, 791 F.3d
in resolving a motion under Rule 12(b)(6), a court is
“generally limited to a review of the allegations of
the complaint itself.” Goines, 2016 WL 2621262, at *3.
See Bosiger v. U.S. Airways, Inc., 510 F.3d 442, 450
(4th Cir. 2007); Clatterbuck v. City of
Charlottesville, 708 F.3d 549, 557 (4th Cir. 2013)
(abrogated on other grounds by Reed v. Town of Gilbert,
Ariz., __U.S. __, 135 S.Ct. 2218 (2015), as recognized
in Cahaly v. Larosa, 796 F.3d 399 (4th Cir. 2015)).
Under certain limited exceptions, however, a court may
consider documents beyond the complaint without converting
the motion to dismiss to one for summary judgment.
Goldfarb v. Mayor & City Council of Baltimore,
791 F.3d 500, 508 (4th Cir. 2015).
relevance here, a court may properly consider documents that
are “explicitly incorporated into the complaint by
reference and those attached to the complaint as exhibits . .
. .” Goines, 2016 WL 2621262, at *3 (citations
omitted); see U.S. ex rel. Oberg v. Pennsylvania Higher
Educ. Assistance Agency, 745 F.3d 131, 136 (4th Cir.
2014) (quoting Philips v. Pitt Cty. Memorial Hosp.,
572 F.3d 176, 180 (4th Cir. 2009)); see Anand v. Ocwen
Loan Servicing, LLC, 754 F.3d 195, 198 (4th Cir. 2014);
Am. Chiropractic Ass’n v. Trigon Healthcare,
Inc., 367 F.3d 212, 234 (4th Cir. 2004), cert. denied,
543 U.S. 979 (2004); Phillips v. LCI Int’l
Inc., 190 F.3d 609, 618 (4th Cir. 1999). A court may
also “consider a document submitted by the movant that
was not attached to or expressly incorporated in a complaint,
so long as the document was integral to the complaint and
there is no dispute about the document’s
authenticity.” Goines, 2016 WL 2621262, at *3
(citations omitted). To be “integral, ” a
document must be one “that by its ‘very
existence, and not the mere information it contains, gives
rise to the legal rights asserted.’”
Chesapeake Bay Found., Inc. v. Severstal Sparrows Point,
LLC, 794 F.Supp.2d 602, 611 (D. Md. 2011) (citation
omitted) (emphasis in original).
“before treating the contents of an attached or
incorporated document as true, the district court should
consider the nature of the document and why the plaintiff
attached it.” Goines, 2016 WL 2621262, at *5
(citing N. Indiana Gun & Outdoor Shows, Inc. v. City
of S. Bend, 163 F.3d 449, 455 (7th Cir. 1998)).
“When the plaintiff attaches or incorporates a document
upon which his claim is based, or when the complaint
otherwise shows that the plaintiff has adopted the contents
of the document, crediting the document over conflicting
allegations in the complaint is proper.”
Goines, 2016 WL 2621262, at *5. Conversely,
“where the plaintiff attaches or incorporates a
document for purposes other than the truthfulness of the
document, it is inappropriate to treat the contents of that
document as true.” Id.
basis, I have considered the exhibits that plaintiffs
appended to their Complaint.
Motion advances two primary arguments. First, Prestige
contends that plaintiffs fail to state a claim under §
1983 and, accordingly, that this Court lacks federal question
jurisdiction pursuant to 28 U.S.C. § 1331. See
ECF 13 at 5. Second, Prestige maintains that this Court lacks
diversity jurisdiction because “the amount in
controversy between the diverse parties does not in fact
exceed $75, 000 as required by 28 USC §1332 . . .
.” Id. at 2. I shall address each argument in
28 U.S.C. § 1331; 42 U.S.C. § 1983; and 42 U.S.C.
1331 of Title 28 of the United States Code grants federal
district courts “original jurisdiction of all civil
actions arising under the Constitution, laws, or treaties of
the United States.” As the Supreme Court has noted,
“there is no serious debate that a federally created
claim for relief is generally a sufficient condition for
federal question jurisdiction, ” because in that case
“federal law creates the right of action and provides
the rules of decision.” Mims v. Arrow Fin. Servs.,
LLC, __U.S. __, 132 S.Ct. 740, 748 (2012) (internal
citations and quotation marks omitted). The
“‘presence or absence of federal-question
jurisdiction is governed by the ‘well-pleaded complaint
rule, ’ which provides that federal jurisdiction exists
only when a federal question is presented on the face of the
plaintiff’s properly pleaded complaint.’”
Rivet v. Regions Bank of La., 522 U.S. 470, 475
(1998) (citation omitted).
1983 of Title 42 of the United States Code states:
“Every person who, under color of any statute,
ordinance, regulation, custom, or usage, of any State or
Territory . . . subjects, or causes to be subjected, any
citizen of the United States or other person with 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 . . . .” It
provides a private cause of action for constitutional
violations committed by persons acting under color of state
law. However, it “‘is not itself a source of
substantive rights, ’ but merely provides ‘a
method for vindicating federal rights elsewhere
conferred.’” Albright v. Oliver, 510
U.S. 266, 271 (1994) (quoting Baker v. McCollan, 443
U.S. 137, 144 n. 3 (1979)). Accordingly, a civil action under
§ 1983 allows “a party who has been
deprived of a federal right under the color of state law to
seek relief.” City of Monterey v. Del Monte Dunes
at Monterey, Ltd., 526 U.S. 687, 707 (1999); see
also West v. Adkins, 487 U.S. 42, 49 (1988); Lugar
v. Edmondson Oil Co., 457 U.S. 922, 928-930 (1982).
establish a claim under § 1983, a plaintiff
must prove: (1) that the defendant, a person, “deprived
[the plaintiff] of a right secured by the Constitution and
laws of the United States;” and (2) that the defendant
acted “under color of [State] statute, ordinance,
regulation, custom, or usage.” Mentavlos v.
Anderson, 249 F.3d 301, 310 (4th Cir. 2001) (citation
and internal quotation marks omitted), cert. denied,
534 U.S. 952 (2001). Thus, in order successfully to assert a
claim of violation of constitutional rights under §
1983, the defendant must be a state actor. In other
words, “the under-color-of-state-law element of §
1983 excludes from its reach ‘merely private conduct,
no matter how discriminatory or wrongful.’”
American Mfrs. Mut. Ins. Co. v. Sullivan, 526 U.S.
40, 50 (1999) (citation omitted).
regard, the Fourth Circuit has described the “Bill of
Rights as a shield that protects private citizens from the
excesses of government, rather than a sword that they may use
to impose liability upon one another.” Holly v.
Scott, 434 F.3d 287, 292 (4th Cir. 2006), cert.
denied, 547 U.S. 1168 (2006). Notably, the Fourth
Circuit has said: “‘[P]rivate activity will
generally not be deemed ‘state action’ unless the
state has so dominated such activity as to convert it to
state action: ‘Mere approval of or acquiescence in the
initiatives of a private party’ is
insufficient.’” Wahi v. Charleston Area Med.
Ctr., Inc., 562 F.3d 599, 616 (4th Cir. 2009) (quoting
DeBauche v. Trani, 191 F.3d 499, 507 (4th Cir. 1999)
(alterations in Wahi), cert. denied, 558
U.S. 1158 (2010).
“there are infrequently arising circumstances under
which the actions of an ostensibly private party will be
deemed to satisfy the color-of-law requirement.”
Philips, 572 F.3d at 181. As the Fourth Circuit has
noted, “cases deciding when private action might be
deemed that of the state have not been a model of consistency
. . . .” Mentavlos, 249 F.3d at 313 (citations
and quotation marks omitted). But, “the critical
inquiry has remained constant. After examining the relevant
facts and circumstances, the inquiry in each case is whether
the conduct is fairly attributable to the state.”
Id. (citations and quotation marks omitted); see
Philips, 572 F.3d at 182 (“In the end, however,
‘there is no specific formula’ for determining
whether state action is present . . . . ‘What is fairly
attributable [to the state] is a matter of normative
judgment, and the criteria lack rigid
simplicity.’”)(quoting Holly, 434 F.3d
at 292 (4th Cir. 2006)(alterations in Philips)).
Mentavlos, 249 F.3d at 313, the Fourth Circuit
explained various tests that it has employed to determine
whether the conduct of a private party may be
“‘fairly attributable’ to the State.”
The Court said, id. at 313-14:
[I]n Andrews v. Federal Home Loan Bank, 998 F.2d 214
(4th Cir. 1993), we identified four circumstances under which
the Supreme Court had held that a private party may be deemed
a state actor for purposes of § 1983 liability:
(1) when the state has coerced the private actor to commit an
act that would be unconstitutional if done by the state; (2)
when the state has sought to evade a clear constitutional
duty through delegation to a private actor; (3) when the
state has delegated a traditionally and exclusively public
function to a private actor; or (4) when the state has
committed an unconstitutional act in the course of enforcing
a right of a private citizen.
Id. at 217; see also DeBauche v.
Trani, 191 F.3d 499, 507 (4th Cir. 1999),
cert. denied, 529 U.S. 1033, 120 S.Ct. 1451, 146
L.Ed.2d 337 (2000).
In Haavistola [v. Community Fire Co. of Rising
Sun, 6 F.3d 211 (4th Cir. 1993)], another panel
of this court summarized three situations in which conduct by
a private entity could be fairly attributable to the state:
(1) when a sufficiently close nexus exists between a
regulated entity and a state such that the actions of the
former are fairly treated as those of the state; (2) when the
state “has exercised coercive power or has provided
such significant encouragement that the action must in law be
deemed to be that of the state”; and (3) “when
the private entity has exercised powers that are
traditionally the exclusive prerogative of the state.”
[Id.] at 215 (internal citations and quotation marks
Most recently, in Goldstein [v. Chestnut Ridge
Volunteer Fire Co., 218 F.3d 337 (4th Cir.
2000)], we emphasized the fact-based nature of the
state action inquiry, reiterating that “the state
action determination requires an examination of all the
relevant circumstances, in an attempt to evaluate the degree
of the Government’s participation in the private
party’s activities.” [Id.] at 342
(internal quotation marks omitted). There, we identified
several considerations which are pertinent to the inquiry:
(1) “whether the injury caused is aggravated in a
unique way by the incidents of governmental authority”;
(2) “the extent and nature of public assistance and
public benefits accorded the private entity”; (3)
“the extent and nature of governmental regulation over
the institution”; and (4) “how the state itself
views the entity, i.e., whether the state itself
regards the actor as a state actor.” Id. at
343 (internal quotation marks omitted). Like its
predecessors in this circuit, however, the Goldstein
decision summarized considerations already set forth by
precedent, and did not purport to overrule our prior
precedents or espouse new areas of inquiry. Indeed,
Haavistola summarized the standard set forth by the
Supreme Court in Blum [v. Yaretsky, 457 U.S. 991,
1004-05 (1982)], see Haavistola, 6
F.3d at 215, which is still relied upon by the Court today,
see Brentwood [Acad. v. Tennessee
Secondary Sch. Athletic Ass'n, 531 U.S. 288 (2001)].
Fourth Circuit concluded by identifying “the ultimate
inquiry”: “Is there a sufficiently ‘close
nexus’ between the challenged actions of [the
defendants] and the State . . . such that their actions
‘may be fairly treated as that of the State
itself.’” Mentavlos, 249 F.3d at 314
(quoting Brentwood Acad., 531 U.S. at 295).
also rely on Title 42 U.S.C. § 1988. It provides that in
federal civil rights actions “the court, in its
discretion, may allow the prevailing party . . . a ...