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Donahoe v. Arpaio

United States District Court, D. Arizona

December 5, 2013

Gary Donahoe and Cherie Donahoe, husband and wife, Plaintiffs,
v.
Sheriff Joseph Arpaio and Ava Arpaio, husband and wife; Andrew Thomas and Anne Thomas, husband and wife; Lisa Aubuchon and Peter R. Pestalozzi, wife and husband; Deputy Chief David Hendershott and Anna Hendershott, husband and wife; Peter Spaw and Jane Doe Spaw, husband and wife; Maricopa County, a municipal entity; Jon Does I-X; Jane Does I-X; Black Corporations I-V; and White Partnerships I-V, Defendants. Donald T. Stapley, Jr. and Kathleen Stapley, husband and wife, Plaintiffs,
v.
Sheriff Joseph Arpaio and Ava Arpaio, husband and wife; et al., Defendants

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For Donald T Stapley, Jr., husband, Kathleen Stapley, wife (2:10-cv-02756-NVW), Consol Plaintiffs: Lawrence J Wulkan, Stefan Mark Palys, LEAD ATTORNEYS, Stinson Morrison Hecker LLP - Phoenix, AZ, Phoenix, AZ; Michael C Manning, LEAD ATTORNEY, Stinson Morrison Hecker LLP, Phoenix, AZ.

For Joseph M Arpaio, named as: Sheriff Joseph Arpaio/ husband (2:10-cv-02756-NVW), Defendant: Jeffrey S Leonard, LEAD ATTORNEY, Sacks Tierney PA, Scottsdale, AZ; John James Kastner, Jr., Roger W Perry, Jr., LEAD ATTORNEYS, Daryl A Audilett, Audilett Kastner PC, Tucson, AZ.

For Ava Arpaio, wife (2:10-cv-02756-NVW), Defendant: Jeffrey S Leonard, LEAD ATTORNEY, Sacks Tierney PA, Scottsdale, AZ; John James Kastner, Jr., Roger W Perry, Jr., LEAD ATTORNEYS, Audilett Kastner PC, Tucson, AZ; Daryl A Audilett, Kimble Nelson Audilett & Kastner PC, Tucson, AZ.

For Andrew Thomas, husband, Anne Thomas, wife (2:10-cv-02756-NVW), Defendants: Jeffrey S Leonard, LEAD ATTORNEY, Sacks Tierney PA, Scottsdale, AZ; Donald Wilson, Jr., Broening Oberg Woods & Wilson PC - Phoenix, AZ, Phoenix, AZ; Richard E Chambliss, Sarah Lynn Barnes, Broening Oberg Woods & Wilson PC, Phoenix, AZ.

For Lisa Aubuchon, wife, Peter R Pestalozzi, husband (2:10-cv-02756-NVW), Defendants: Bradley L Booke, LEAD ATTORNEY, Edward P Moriarity, Moriarity Badaruddin & Booke, Missoula, MT; Jeffrey S Leonard, LEAD ATTORNEY, Sacks Tierney PA, Scottsdale, AZ; Douglas V Drury, James Paul Mueller, Mueller Drury & Lawrence, Scottsdale, AZ.

For David Hendershott, Deputy Chief/ husband, Anna Hendershott, wife (2:10-cv-02756-NVW), Defendants: Bradley L Booke, LEAD ATTORNEY, Edward P Moriarity, Moriarity Badaruddin & Booke, Missoula, MT; Bradley Michael Thies, LEAD ATTORNEY, Barry Matthew Markson, Thomas Thomas & Markson PC, Phoenix, AZ; Jeffrey S Leonard, LEAD ATTORNEY, Sacks Tierney PA, Scottsdale, AZ.

For William Montgomery, only in his official capacity as Maricopa County Attorney (2:10-cv-02756-NVW), Defendant: Victoria Lea Orze, Dickinson Wright/Mariscal Weeks, Phoenix, AZ.

For Maricopa, County of, a municipal entity (2:10-cv-02756-NVW), Defendant: Helen Rubenstein Holden, Jeffrey S Leonard, Sharon Brook Shively, LEAD ATTORNEYS, Sacks Tierney PA, Scottsdale, AZ.

Paul R Babeu, names as: Paul Babeu (2:10-cv-02756-NVW), Movant, Pro se.

For Donald T Stapley, Jr., husband, Kathleen Stapley, wife (2:11-cv-00902-NVW), Plaintiffs: Kenneth B Vaughn, Merwin D Grant, Grant & Vaughn PC, Phoenix, AZ.

For Joseph M Arpaio, named as: Sheriff Joseph Arpaio/ husband, Ava Arpaio, wife (2:11-cv-00902-NVW), Defendants: Daryl A Audilett, Kimble Nelson Audilett & Kastner PC, Tucson, AZ.

For Andrew P Thomas, named as: Andrew Thomas/ husband, Anne Thomas, wife (2:11-cv-00902-NVW), Defendants: Donald Wilson, Jr., Richard E Chambliss, Sarah Lynn Barnes, Broening Oberg Woods & Wilson PC, Phoenix, AZ.

For Lisa Aubuchon, wife, Peter R Pestalozzi, husband (2:11-cv-00902-NVW), Defendants: James Paul Mueller, Mueller Drury & Lawrence, Scottsdale, AZ.

For David Hendershott, Deputy Chief/ husband, Anna Hendershott, wife (2:11-cv-00902-NVW), Defendants: Barry Matthew Markson, Thomas Thomas & Markson PC, Phoenix, AZ.

For Maricopa, County of, a municipal entity in Arizona (2:11-cv-00902-NVW), Defendant: Daniel Baca Mestaz, Helen Rubenstein Holden, Jeffrey S Leonard, Sharon Brook Shively, LEAD ATTORNEYS, Sacks Tierney PA, Scottsdale, AZ.

OPINION

Page 1100

ORDER

Neil V. Wake, United States District Judge.

TABLE OF CONTENTS

I. SUMMARY OF RULINGS

II. LEGAL STANDARD

III. STAPLEY I

A. Legal standard

B. Probable cause

1. The 1994 Board of Supervisors resolution

2. Statute of limitations

C. Malice

D. Favorable termination

E. Accrual of action

IV. THE SEARCH

A. Legal standard

B. Evidence supporting the search warrant

1. Evidence regarding fraud

2. Evidence regarding bribery

3. Evidence regarding misuse of public funds

C. Misrepresentations and omissions in the supporting affidavit

1. Misrepresentation and omissions of evidence of bribery

i. Review of bank records

ii. Partnership documents

iii. Public records of partnership

iv. Disclosure

v. Voting record

2. Misrepresentation and omissions of evidence of misused public funds

D. Materiality of misrepresentations and omissions

E. Deliberate or reckless disregard for the truth

1. Aubuchon

i. Involvement

ii. Evidence

2. Thomas

3. Hendershott

4. Arpaio

F. Qualified immunity

1. Legal standard

2. Application to the search

V. THE ARREST AND STAPLEY II INDICTMENT

A. Legal standard

B. Probable cause

1. Fraudulent schemes and artifices (arrest)

2. Perjury (arrest and indictment)

3. False swearing (indictment)

C. Defendants' roles in the arrest

D. Malice or improper purpose in prosecuting Stapley II

E. Favorable termination

F. Qualified immunity for the arrest

VI. THE RACKETEERING ACTION

A. Background

B. Legal standard

C. Analysis

1. Involvement

2. Probable cause (reasonable belief and advice of counsel)

3. Malice

4. Favorable termination

VII. RETALIATION AND QUALIFIED IMMUNITY

A. Constitutional violation

B. Clearly established right

XIII. ABSOLUTE IMMUNITY

A. Legal standard

B. Analysis

IX. INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS AND PUNITIVE

DAMAGES

A. Legal standard

B. Analysis

X. UNCONSTITUTIONAL POLICIES OR CUSTOMS

XI. PLAINTIFF'S MOTIONS FOR SUMMARY JUDGMENT

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Before the Court are seven motions for summary judgment filed by Plaintiff Donald T. Stapley, Jr. and Defendants Joseph Arpaio, Lisa Aubuchon, David Hendershott, and Andrew Thomas. For the following reasons, Plaintiff's motions will be denied and Defendants' motions will be granted in part and denied in part.

I. SUMMARY OF RULINGS

The allegations underlying this dispute are set forth in Donahoe v. Arpaio, 869 F.Supp.2d 1020 (D. Ariz. 2012), aff'd sub nom. Stapley v. Pestalozzi, 733 F.3d 804 (9th Cir. 2013). They describe an extended criminal and civil campaign against the Maricopa County Board of Supervisors, of which Stapley was then a member, by the Maricopa County Sheriff's Office (MCSO), the Maricopa County Attorney's Office (MCAO), and their joint anti-corruption task force (MACE). The details are not recounted here except as necessary to explain the rulings. Stapley has now moved for partial summary judgment against Sheriff Joseph Arpaio (Doc. 1060), former Deputy County Attorney Lisa Aubuchon (Doc. 1065), and former Chief Deputy David Hendershott (Doc. 1056). In turn, Arpaio (Doc. 1062), Aubuchon (Doc. 1066),

Page 1102

Hendershott (Doc. 1072), and former County Attorney Andrew Thomas (Doc. 1063) have moved for summary judgment. Stapley's motion for partial summary judgment against Thomas (Doc. 1147) and Maricopa County's motion for summary judgment against Stapley (Doc. 1149) were previously denied.

Stapley seeks summary judgment that

(1) Arpaio ordered a retaliatory arrest in violation of 42 U.S.C. § 1983;
(2) Aubuchon engaged in judicial deception and searched his office in violation of 42 U.S.C. § 1983; and
(3) Hendershott wrongfully instituted a federal racketeering action against him in violation of state law and 42 U.S.C. § 1983.

All Defendants seek summary judgment that

(1) they are not liable for maliciously prosecuting or investigating Stapley in the criminal actions commonly referred to as Stapley I and Stapley II;
(2) they are not liable for retaliating against Stapley for exercising his constitutional rights;
(3) they are not liable for the search of Stapley's office;
(4) they have absolute or qualified immunity as to various claims;
(5) they are not liable for intentional infliction of emotional distress; and
(6) Stapley may not recover punitive damages.

Arpaio, Aubuchon, and Hendershott also seek summary judgment that they are not liable for Stapley's arrest.

Arpaio and Hendershott also seek summary judgment that

(1) their roles in the federal racketeering action do not give rise to liability; and
(2) they are not liable for establishing unconstitutional policies or customs within MCSO, for failing to train employees, or for negligently supervising them.

The Defendants' motions for summary judgment will be granted against the following claims.

As to Defendant Arpaio, summary judgment will be granted against Stapley's ninth claim for unconstitutional policies, customs, failure to train, and negligent supervision.

As to Defendant Aubuchon, summary judgment will be granted against Stapley's second and fifth claims for malicious prosecution and against his fourth claim for false arrest.

As to Defendant Hendershott, summary judgment will be granted against Stapley's ninth claim for unconstitutional policies, customs, failure to train, and negligent supervision.

As to Defendant Thomas, summary judgment will be granted against Stapley's second and fifth claims for malicious prosecution and against his tenth claim for unlawful search.

The motions will otherwise be denied.

II. LEGAL STANDARD

A motion for summary judgment tests whether the opposing party has sufficient evidence to merit a trial. At its core, it questions whether sufficient evidence exists from which a reasonable jury could find in favor of the party opposing the motion for summary judgment. Summary judgment should be granted if the evidence shows there is no genuine dispute about any material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). The moving party has the burden of demonstrating

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that no material issue of fact exists for the jury to decide. See Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). To meet this burden, the moving party must point out the lack of evidence supporting the nonmoving party's claim but need not produce evidence negating that claim. Id. at 325.

When the moving party has carried its burden under Federal Rule of Civil Procedure 56(c), the nonmoving party must show that there are genuine issues of material fact. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A material fact is one that might affect the outcome of the suit under the governing law, and a factual issue is genuine " if the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Id. at 248. The nonmoving party must produce evidence to support its claim or defense by more than simply showing " there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986). The Court must view the evidence in the light most favorable to the nonmoving party, must not weigh the evidence or assess its credibility, and must draw all justifiable inferences in favor of the nonmoving party. Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150, 120 S.Ct. 2097, 147 L.Ed.2d 105 (2000); Anderson, 477 U.S. at 255. Where the record, taken as a whole, could not lead a rational trier of fact to find for the nonmoving party, there is no genuine issue of material fact for trial. Matsushita, 475 U.S. at 587.

On summary judgment, the nonmoving party's evidence is presumed true, and all inferences from the evidence are drawn in the light most favorable to the nonmoving party. Eisenberg v. Ins. Co. of North America, 815 F.2d 1285, 1289 (9th Cir. 1987); Baldwin v. Trailer Inns, Inc., 266 F.3d 1104, 1117 (9th Cir. 2001). But the evidence presented by the parties must be admissible or able to be produced in admissible form. See Fed.R.Civ.P. 56(c)(2). Conclusory and speculative testimony in affidavits and moving papers is insufficient to raise genuine issues of fact and to defeat summary judgment. Thornhill Publ'g Co., Inc. v. GTE Corp., 594 F.2d 730, 738 (9th Cir. 1979).

III. STAPLEY I

On November 20, 2008, a grand jury returned a 118-count indictment against Stapley ( Stapley I ), charging him largely with violations of disclosure laws related to his position as a Maricopa County Supervisor. See Doc. 1112-9 at 26. On December 2, an MCSO sergeant served Stapley with the summons. See id. at 29.

Stapley seeks damages for malicious prosecution based on the investigations that led to this indictment--his third claim for relief. Stapley no longer asserts separate malicious prosecution claims against Thomas and Aubuchon, which the Court has held absolutely immune from suit. Thus, Arpaio and Hendershott are the only remaining defendants with respect to the malicious prosecution claims. Each moves for summary judgment.

A. Legal standard

For malicious prosecution under Arizona law, Stapley must prove (1) Defendants initiated or procured the criminal proceeding, (2) the prosecution terminated in Stapley's favor, (3) the prosecution lacked probable cause, and (4) malice, or a primary purpose other than bringing him to justice. See Restatement (Second) of Torts § 653 (1977); see also Frey v. Stoneman, 150 Ariz. 106, 109, 722 P.2d 274, 277

Page 1104

(1986). " A criminal defendant may maintain a malicious prosecution claim not only against prosecutors but also against others--including police officers and investigators--who wrongfully caused his prosecution." Smith v. Almada, 640 F.3d 931, 938 (9th Cir. 2011).

Notably, " a malicious prosecution claim is treated differently from one for false arrest: whereas probable cause to believe that a person has committed any crime will preclude a false arrest claim, even if the person was arrested on additional or different charges for which there was no probable cause, . . . probable cause as to one charge will not bar a malicious prosecution claim based on a second, distinct charge as to which probable cause was lacking." Holmes v. Vill. of Hoffman Estates, 511 F.3d 673, 682 (7th Cir. 2007) (internal citations omitted); accord Jernigan v. Richard, 907 F.Supp.2d 998, 1041 (D. Ariz. 2012) (upholding malicious prosecution claim where probable cause supported some--but not all--of the criminal counts charged against plaintiff).

B. Probable cause

Both Arpaio and Hendershott assert the existence of probable cause. " In the context of malicious prosecution, probable cause is defined as 'a reasonable ground of suspicion, supported by circumstances sufficient to warrant an ordinarily prudent man in believing the accused is guilty of the offense . . . . The test generally applied is: upon the appearances presented to the defendant, would a reasonably prudent man have instituted or continued the proceeding?'" Gonzales v. City of Phoenix, 203 Ariz. 152, 155, 52 P.3d 184, 187 (2002) (quoting McClinton v. Rice, 76 Ariz. 358, 367, 265 P.2d 425, 431 (1953)). The question of probable cause is generally one for the court. Gonzales, 203 Ariz. at 155, 52 P.3d at 187. " If, however, the evidence is conflicting, so that on one conclusion as to the facts drawn therefrom probable cause exists, while from another it does not, it is then for the jury to determine the true state of facts and to apply the law as laid down by the court to those facts." Sarwark Motor Sales, Inc. v. Woolridge, 88 Ariz. 173, 177, 354 P.2d 34, 36 (1960). Summary judgment is appropriate if a reasonable jury could not find an absence of probable cause based on the undisputed facts. See, e.g., Gasho v. United States, 39 F.3d 1420, 1428 (9th Cir. 1994).

1. The 1994 Board of Supervisors resolution

The Stapley I charges were premised on Stapley's knowing failure to disclose financial transactions as required by state law. As early as January 2007, Special Deputy County Attorney Mark Goldman--a volunteer attorney with MCAO--and MCSO Sergeant Brandon Luth began investigating Stapley. See Doc. 1112-6 at 74-75; Doc. 1112-14 at 132; 1112-3 at 75. Thomas either directed Goldman to search public records regarding Stapley's relationship with another lawyer, Tom Irvine, or approved Goldman voluntarily undertaking the task. Compare Doc. 1112-6 at 74-75 with id. at 90. Luth was ordered by Hendershott to " start looking into [Stapley's] business dealings and [other] matters." Doc. 1112-3 at 75.

The parties dispute the origin of the investigation. There is evidence that " [t]here was no traditional complainant for any of the investigations concerning Supervisor Stapley" and instead that the investigations " spawned from Thomas'[s] directive to Goldman to search public records to find evidence of a crime." Doc. 1112 ¶ ¶ 122, 132; see also Doc. 1112-9 at 6 (MCAO employee suggesting Thomas decided to investigate Stapley in response

Page 1105

to news reports regarding Stapley). But see Doc. 1112-6 at 108-11 (Thomas testifying that Goldman volunteered to research Stapley's financial relationship with Irvine after Thomas received a tip about potential wrongdoing between Stapley and Irvine); Doc. 1142 ¶ 122 (Arpaio also stating there was a complainant in the earlier investigation regarding Irvine).

By May 2007, Goldman informed Thomas of potential issues with Stapley's records and then informed MACE at Thomas's direction. See Doc. 1112-6 at 113-14, 117-18. No further action appears to have been taken until March 2008 [1] when Aubuchon took over Goldman's research, learned from him that there were " issues" with Stapley's records, and concluded there were criminal nondisclosures. See Doc. 1112-8 at 11-15. When Aubuchon received Goldman's research, she noted that they were time stamped from early 2007. See id. at 15. She then met with MACE deputies on May 14, 2008, see id. at 25-26, presented a draft indictment dated May 29, see id. at 22, and told the deputies to use May 14 as the date on which the investigation started. See Doc. 1112-3 at 88.

On May 8, 2009, Thomas enlisted MCAO Commander Mark Stribling to assist the investigation. See Doc. 1112-9 at 5. At Aubuchon's suggestion, Stribling contacted Fran McCarroll, the Clerk of the Board of Supervisors, to " get some documents about resolutions that the board had passed related to how disclosures were done because apparently throughout the years the way disclosures were handled had changed some." Id. at 17. Because MCAO sought to indict Stapley for violating the 1994 Maricopa County rule or resolution applying state disclosure rules to county officers, his criminal culpability turned on whether the Board's 1994 resolution had in fact adopted state law.

On May 22, 2008, McCarroll informed Stribling that the Board had in fact adopted a resolution " consistent with [state law]." Doc. 1069-2 at 3. Stribling informed Luth of this the same day, and Luth entered it into an MCSO supplemental report. Id. at 2. Indeed, McCarroll " confirmed that elected county officials, including the Board of Supervisors, were required to file financial disclosure statements with her office." Doc. 1073 at 2. McCarroll also provided copies of past Board minutes. These reflect that the Board resolved to adopt the disclosure requirements in 1974 and amended the requirements in 1979. They further reflect that in 1994 the Board resolved to rescind the 1979 resolution " and update the Financial Disclosure form for Elected Officials to bring the form and process into compliance with A.R.S. 38-541." Doc. 1112 ¶ 110 (" Financial disclosure forms must be filed by January 31, each year, with the Clerk of the Board." ). Stribling appears to have provided these documents to Luth, and it appears that somebody created a handwritten timeline on one of these documents indicating that the Board rescinded the 1979 resolution. See Doc. 1069-2 at 4 (" 1994--Rescind reso re: Exempt employees & update Fin. Disc. Form" ). Notwithstanding the Board's apparent intent to update its disclosure protocol, the Board's 1994 resolution did not adopt state law requiring disclosures. See State v. Stapley, 227 Ariz. 61, 65-66, 251 P.3d 1048, 1052-53 (Ct. App. 2011).

MCSO deputies obtained Stapley's financial disclosures and discovered evidence

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that Stapley had " omitted information in his required disclosures for thirteen years, from 1994 through 2007." Doc. 1072 at 4. Aubuchon presented the case to a grand jury, see Doc. 1112-9 at 50, which returned a 118-count indictment against Stapley " in connection with false and/or incomplete financial disclosures he filed," Doc. 1072 at 4, in violation of " A.R.S § § 38-542, 38-542(A)(5), 38-544, 38-541, 38-545, 13-707, 13-802, and Maricopa County Rule or Resolution adopted January 20, 1994." Stapley, 227 Ariz. at 64 n.4, 251 P.2d at 1051 n.4.

Here, there is a factual dispute as to what MCSO and MCAO officials believed and when they believed it. Aubuchon presented Stapley I to the grand jury in November 2008, six months after McCarroll disclosed the relevant documents and communicated her belief regarding the disclosure requirements to Stribling. At the grand jury hearing, a state witness explained that " there's a resolution by the county that was adopted in '94 that requires county officials to comply with the Arizona statute 38-542, which requires those disclosures be completed." Doc. 1112-9 at 50. Aubuchon asked whether the resolution " address[ed] candidate disclosure forms" and the witness responded that " [i]t wasn't clearly covered under the resolution." Id.

Even if McCarroll actually believed the 1994 resolution adopted the disclosure requirements--and it appears she did--MACE had six months to review the language of the 1994 resolution and conduct further investigation as to whether the intention reflected in the 1994 resolution was ever acted on (it was not). It is clear that someone handwrote on the documents McCarroll disclosed to Stribling that the 1994 resolution rescinded the 1979 resolution, but it is unclear whether the author of those notes appreciated the impact of the 1994 resolution--the grand jury testimony quoted above suggests it was either misunderstood or deliberately ignored. Further, it is unclear who wrote it or when. If everyone believed that the resolution had been adopted at the time Aubuchon presented the indictment to the grand jury--because that is what McCarroll told them--then an ordinarily prudent person may have continued the investigation. But it is at best a matter of debate, and therefore jury trial, whether it was reasonable to seek indictment without ever seeing the supposed resolution to confirm its existence and to know exactly what the text of the resolution required to be disclosed. Moreover, if Stribling (or Luth, or Aubuchon) knew the effect of the resolution prior to the grand jury hearing in November 2008, and thus had reason to know that McCarroll was incorrect, then an ordinarily prudent person would not have believed probable cause existed to charge Stapley with disclosure violations. A plain reading of the 1994 resolution shows that it rescinded prior resolutions and adopted nothing in their place. The facts preclude summary judgment that probable cause existed.

2. Statute of limitations

Irrespective of whether Luth or Stribling had probable cause to charge Stapley based on McCarroll's statement and a misreading of the 1994 resolution, Aubuchon attended the MACE meeting and presented the Stapley I draft indictment before the Stribling-McCarroll interactions. Because McCarroll had not yet stated the 1994 resolution adopted the Arizona statutes regarding financial disclosures, her statement could not supply a factual basis for probable cause at that point--mere inconsistencies among Stapley's publicly recorded disclosures do not establish what he was required to disclose.

Page 1107

Moreover, when questioned by Stribling about whether the inconsistencies might reflect clerical error rather than knowing nondisclosure, Aubuchon stated that " if [the disclosure information is] not there then it's a crime." Doc. 1112-9 at 18. This also suggests lack of probable cause to believe Stapley knowingly failed to disclose the relevant information.

Further, as noted above there is evidence Aubuchon instructed MACE deputies at the May 14 meeting to forward date their investigation, using May 14, 2008, rather than January 2007, as the date on which their work began. See Doc. 1112-3 at 87-88. This supports a finding that Aubuchon knew the statute of limitations on filing misdemeanor charges had run. Indeed, Luth testified that he understood that forward dating could have been an attempt to circumvent the statute of limitations. See id. at 9-10. This could lead a reasonable juror to conclude that even if Luth had probable cause to believe Stapley failed to disclose information, he knew or suspected that any resulting misdemeanor charges would be barred by the statute of limitations. This is consistent with Commissioner Passomonte's concerns at the Stapley I grand jury hearing, who declined to issue an arrest warrant in part because " [s]ome of th[e] charges, on their face, appear[ed] to be outside of the statute of limitations time." Doc. 1112-9 at 58, 64. Indeed, Aubuchon's negligence or knowledge as to the statute of limitations constituted partial grounds for her disbarment. See In re Aubuchon, 233 Ariz. 62, 309 P.3d 886, 8926293 (2013). To the extent Aubuchon, Luth, or other MACE deputies knew the claims were time barred, this supports a finding that there was no probable cause by the time Aubuchon presented the case to the grand jury. The evidence precludes summary judgment for Defendants.

C. Malice

Arpaio and Hendershott have not refuted an inference of malice--that they " initiate[d] or procure[d] the proceedings . . . primarily for a purpose other than that of bringing an offender to justice . . . ." Restatement (Second) of Torts § 653 (1977). A lack of probable cause may serve as evidence of improper purpose. Id. § 669. " The converse is not true. The fact that the defendant initiated or continued the prosecution or procured it for an improper purpose . . . is not in any way inconsistent with his reasonable belief in the guilt of the accused and the existence of grounds reasonably justifying that belief." Id. § 669A cmt. b. Finally, " [w]hen there is evidence that [an ulterior] motive played a substantial part in influencing his decision, the determination of whether the ulterior purpose was the primary one is normally for the jury." Id. § 668.

Here, Stapley has testified that Arpaio and Hendershott both threatened to sue him sometime prior to the spring of 2008 for making budget decisions adverse to MCSO and that in the spring of 2008 Hendershott told Stapley that if the supervisor crossed a metaphorical line in the sand regarding budget cuts, " I will get you. We will get you." Doc. 1112-5 at 20. A reasonable jury could conclude that these coinciding threats were made and reflect that Arpaio and Hendershott directed or approved the criminal investigation that concluded with the Stapley I indictment for an improper purpose. Arpaio and Hendershott therefore have not refuted the inference that they acted with malice.

D. Favorable termination

Arpaio and Hendershott are nonetheless entitled to summary judgment on malicious

Page 1108

prosecution of Stapley I if the case did not terminate in Stapley's favor.

Generally, a criminal proceeding terminates favorably by " final order in favor of the accused by a trial or appellate court." Restatement (Second) of Torts § 659(f). " When a termination or dismissal indicates in some fashion that the accused is innocent of wrongdoing it is a favorable termination. However, if it is merely a procedural or technical dismissal it is not favorable." Frey v. Stoneman, 150 Ariz. 106, 110, 722 P.2d 274, 278 (1986); see also Jaffe v. Stone, 18 Cal.2d 146, 150, 114 P.2d 335, 338 (1941) (" If, however, the dismissal is on technical grounds, for procedural reasons, or for any other reason not inconsistent with his guilt, it does not constitute a favorable termination." ).

Here, Stapley I terminated by final order of the court of appeals in favor of Stapley. The Stapley I termination was inconsistent with guilt because one cannot be guilty of a law that does not exist. See Stapley, 227 Ariz. at 66, 251 P.3d at 1053. Irrespective of what McCarroll and Stapley believed Stapley was required to do by law, the fact is there was no properly adopted law requiring the disclosures.

E. Accrual of action

" A claim for malicious prosecution does not accrue until the prior proceedings have terminated in the accused's favor, including any pending appeal that could lead to further proceedings." Ekweani v. Maricopa Cnty. Sheriff's Office, No. CV-08-01551-PHX-FJM, 2010 WL 2079773, at *6 (D. Ariz. May 24, 2010), aff'd, 471 F.Appx. 583 (9th Cir. 2012). Cf. Amfac Distribution Corp. v. Miller, 138 Ariz. 152, 154, 673 P.2d 792, 794 (1983) (concluding that the " damaging effect" of litigation is " not ascertainable until the appellate process is completed or is waived by a failure to appeal" ).

The Court of Appeals affirmed dismissal of the misdemeanor charges on March 24, 2011. Stapley filed his suit on December 23, 2010. His claim is not time barred by state law, which requires that " actions against any public entity or public employee shall be brought within one year after the cause of action accrues . . . ." Ariz. Rev. Stat. Ann. § 12-821.

For the forgoing reasons, Arpaio and Thomas are not entitled to summary judgment as to Stapley's claim for malicious prosecution based on Stapley I.

IV. THE SEARCH

On February 25, 2009, MCSO Sergeant Jeff Gentry presented an application for a search warrant and supporting affidavit to Justice of the Peace Or. Judge Or. issued the search warrant for Stapley's office. See Doc. 1067-2 at 8-12. The accompanying affidavit set out the evidence uncovered by MCSO and MCAO allegedly suggesting that Stapley may have committed bribery, fraudulent schemes, and/or conspiracy to misuse public money. See Doc. 1067-2 at 13-24. The next day, MCSO executed the warrant. See Doc. 1072 at 7.

Stapley seeks summary judgment that Aubuchon violated the Fourth Amendment because she effected the warrant without probable cause. See Doc. 1065 at 5. Stapley asserts the warrant issued because of judicial deception. See, e.g., Doc. 1065 at 5; Doc. 246 ¶ ¶ 307-08. Defendants seek summary judgment that the search was supported by probable cause, precluding liability, see, e.g., Doc. 1072 at 6-7; Doc. 1062 at 13; Doc. 1066 at 12 n.7, that they are entitled to immunity, see, e.g., Doc. 1066 at 13-15; Doc. 1063 at 11 n.8, or that they were otherwise uninvolved. Doc. 1063 at 10-11; Doc. 1139 at 4. Defendants' motions are addressed presently.

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A. Legal standard

The Fourth Amendment prohibits search warrants that lack probable cause. U.S. Const. amend. IV (" no Warrants shall issue, but upon probable cause" ). Probable cause for a search exists " where the known facts and circumstances are sufficient to warrant a man of reasonable prudence in the belief that contraband or evidence of a crime will be found." Ornelas v. United States, 517 U.S. 690, 696, 116 S.Ct. 1657, 134 L.Ed.2d 911 (1996). When evaluating an affidavit for probable cause, a judge may draw " reasonable inferences" from the materials offered. United States v. Gourde, 440 F.3d 1065, 1071 (9th Cir. 2006). A " fair probability" that evidence of a crime will be found suffices for probable cause, Illinois v. Gates, 462 U.S. 213, 238, 103 S.Ct. 2317, 76 L.Ed.2d 527 (1983); " mere suspicion" of criminal activity does not. United States v. Martinez, 588 F.2d 1227, 1234 (9th Cir. 1978).

As a general matter, a determination of probable cause by a judge deserves a great deal of deference. Gates, 462 U.S. at 236. The deference, however, has limits. United States v. Leon, 468 U.S. 897, 914, 104 S.Ct. 3405, 82 L.Ed.2d 677 (1984). To prevail in a § 1983 action asserting deception in an affidavit, a plaintiff must establish both (1) the defendant deliberately or recklessly made false statements in the affidavit and (2) the falsehoods or omissions were material to the finding of probable cause. KRL v. Moore, 384 F.3d 1105, 1117 (9th Cir. 2004). Omissions or falsehoods are material if the judge could not have " issued the warrant in the absence of the contested statements." Hervey v. Estes, 65 F.3d 784, 789 (9th Cir. 1995). Materiality is a matter for the court to determine. KRL, 384 F.3d at 1117. No good-faith exception preserves the ...


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