SCRANTON – A Volkswagen business trust has reiterated that a vehicle it was legally entitled to repossess when its lessee defaulted on payments, was instead taken by Lackawanna County and another auto company, when that same lessee was arrested in April of last year.
VW Credit Leasing, Ltd. of Delaware filed suit in the U.S. District Court for the Middle District of Pennsylvania on March 2 versus Lackawanna County of Scranton and DeNaples Auto Parts, Inc. of Dunmore.
“Lackawanna regularly seizes vehicles as part of its law enforcement activity but has no constitutionally-appropriate procedure for disposing of seized vehicles consistent with the basic due process requirements of notice and a hearing. Instead, Lackawanna employs the outdated and constitutionally-unsound practice of summarily turning over control of seized vehicles to the private company that towed and stored the vehicle when Lackawanna seized it. In this regard, Lackawanna’s policy is to enlist a garage to tow and store vehicles and allow those garages to lien and/or sell the vehicle as a means to cover the costs of towing and storage,” the suit said.
“Lackawanna’s policy and practice of summarily turning over seized vehicles to private tow companies is a joint enterprise from which Lackawanna benefits by avoiding the cost of preserving the seized vehicles and by avoiding the cost of having to pay for towing services, because the tow company accepts the vehicle as compensation for the services it renders to Lackawanna in lieu of money. The tow company benefits by using its control over the vehicle (created under mantle of authority from Lackawanna) to profit by conditioning release of the vehicle upon payment of money to the tow company or by selling the vehicle in the absence of payment.”
The suit added that Lackawanna County’s procedure for disposing of its seized vehicles violates citizens’ rights of the Fourth, Fifth and Fourteenth Amendments to the U.S. Constitution.
“Here, after seizing a vehicle owned and leased by VW Credit after arresting the lessor/driver, Lackawanna afforded no due process to VW Credit and instead summarily disposed of its interests in that vehicle by giving it to DeNaples as payment for the services that Lackawanna had contracted DeNaples to provide,” the suit stated.
“DeNaples accepted the vehicle from Lackawanna as compensation, asserted an ex parte lien for those services, demanded that VW Credit satisfy that ex parte lien – which DeNaples insisted impaired VW Credit’s pre-existing ownership interests – before it would relinquish possession of VW Credit’s property. At no time was VW Credit afforded notice, a hearing, or just compensation for Lackawanna’s taking of VW Credit’s property.”
The suit held that VW Credit is the titled owner of the vehicle in question and both before April 25, 2022 and before any other facts relevant to this action, VW Credit was party (by way of assignment) to a lease agreement with non-party Cynthia Lynn Pollick, who leased the Vehicle from VW Credit.
Before and/or on April 25, 2022, Pollick defaulted under the lease contract, thereafter entitling VW Credit to immediate possession of the vehicle – however, Lackawanna County instead took possession of the vehicle.
“On or about April 25, 2022, Lackawanna arrested the customer pursuant to, upon information and belief, a bench warrant for her arrest, which arrest occurred while the customer was on Lackawanna property. Thereafter, upon realizing the customer had left the vehicle on Lackawanna property, Lackawanna took custody of the vehicle and instructed DeNaples to tow it and store it at Lackawanna’s direction. VW Credit had no involvement with or knowledge of the customer’s actions or the operation of the Vehicle at the time it was seized by Lackawanna law enforcement and/or DeNaples. On or about July 10, 2022 – 76 days later – VW Credit discovered that the Vehicle had been impounded. Upon learning that the vehicle was impounded with DeNaples, VW Credit informed DeNaples that the vehicle was not abandoned, that VW Credit wished to retake possession of the vehicle and demanded that DeNaples release the vehicle to VW Credit,” the suit explained.
“DeNaples refused unless VW Credit paid the fees demanded by DeNaples in order to recover the vehicle. DeNaples asserted that it was able to detain the vehicle from VW Credit because DeNaples claimed a lien on the vehicle for towing and storage charges. There is no law which requires VW Credit to pay Lackawanna’s towing and storage bill for DeNaples’s alleged services surrounding Lackawanna’s impounding of the customer’s vehicle. To the extent Lackawanna or DeNaples seek to rely on any Pennsylvania State law or local ordinance to justify their conduct, these laws are unconstitutional as applied to the circumstances, and/or do not apply to the facts by their terms. VW Credit did not pay the fees demand by DeNaples, and DeNaples refused to release the vehicle to VW Credit. Upon information and belief, DeNaples remains in possession of the vehicle.”
UPDATE
In an Aug. 25 brief to support its motion to dismiss, Lackawanna County found the plaintiff’s claims facially invalid.
“The plaintiff, VW Credit Leasing LTD, falsely claims that the defendant, Lackawanna County, ‘regularly seizes vehicles as part of its law enforcement activity but has no constitutionally appropriate procedure for disposing of seized vehicles consistent with the basic due process requirements of notice and a hearing.’ As discussed below, and highlighted by the precise failings of VW’s complaint, VW’s conclusory language identified above is an effort to create a constitutional fiction of alleged municipal ‘policy or custom’ to support an alleged constitutional violation pursuant to 42 U.S.C. Section 1983, where none exists,” the dismissal motion brief stated.
“Moreover, VW fails to provide any citation, statutory, or memorialized support of an existing ordinance, other than highlighting a single incident, for its claim that the County and DeNaples and other tow companies engage in a ‘joint enterprise’ to deprive vehicle owners of their property pursuant to an established ordinance, custom, or practice. Without more, VW’s complaint lacks the ‘facial plausibility’ required to sustain a Section 1983 municipal liability claim against Lackawanna County.”
An opposing brief from the plaintiff filed on Sept. 29 refuted the County’s arguments.
“The Supreme Court has made it clear that when government agents seize property, due process requires the government to promptly notify persons with interests in the seized property. The County seized a vehicle owned by VW Credit. The County did not notify VW Credit. The County is alleged to have a policy of seizing vehicles and immediately turning them over to its towing and impound contractor, DeNaples Auto Parts, Inc., without promptly notifying persons with preexisting interests in those vehicles and without holding a prompt, post-seizure hearing relating to impounding those vehicles. Instead, the County permits DeNaples to assert an ex parte lien to cover the fees and costs of DeNaples’s services to the County. Neither defendant holds any hearing regarding the turnover to DeNaples, the assertion by DeNaples of an ex parte lien under the County’s authority, or the eventual sale of the seized vehicles to cover the costs of the County’s police activity. Numerous Courts have held that these actions violate the Fourth and Fourteenth Amendments. VW Credit’s complaint contains all the elements of a properly pled 42 U.S.C. Section 1983 challenge. The County does not disagree, other than as to Monell liability. To comply with Monell, a plaintiff need only demonstrate a plausible nexus or affirmative link between the municipality’s custom and the specific deprivation of constitutional rights at issue. When a plaintiff is challenging the constitutionality of a policy or custom itself, the claim that the policy resulted in the plaintiff suffering such a deprivation is all that is needed to satisfy Monell,” the plaintiff’s brief said.
“VW Credit is challenging the County’s policy itself: The County’s policy of seizing vehicles and turning them over to towing companies without notice or a hearing, without a warrant, and without compensation to those with pre-existing property interests. VW Credit need only allege that the County’s overt policy is the cause of the harm, which it has amply done. VW Credit’s complaint alleges all elements of a valid 42 U.S.C. Section 1983 claim and contains factual detail backing up every one of those elements, including a well pled statement of the County’s policy which the County followed in this case. The complaint easily meets the facial plausibility standard, and the Court should reject the County’s arguments and deny its motion.”
For counts of deprivation of property by unlawful seizure, deprivation of property without due process of law, taking of property without just compensation, declaratory relief, replevin, conversion and tortious interference, the plaintiff is seeking actual damages, consequential damages, punitive damages, fees and costs of suit, including reasonable attorneys’ fees, and such other and further relief as the Court deems just and proper.
The plaintiff is represented by Rebecca J. Price, William R. Murphy III and Nicholas A. Duston of Norris McLaughlin, in Allentown and Bridgewater, N.J.
Defendant Lackawanna County is represented by James J. Scanlon of Ridley Chuff Kosierowski & Scanlon, in Milford.
U.S. District Court for the Middle District of Pennsylvania case 3:23-cv-00378
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nick.malfitano@therecordinc.com