National Association for Gun Rights, Inc. v. City Of San Jose

Background

The City of San Jose adopted an ordinance requiring residents who own or possess firearms to maintain liability insurance covering losses or damages from accidental firearm use. The ordinance also required gun owners to pay an annual Gun Harm Reduction Fee to a nonprofit designated by the City. The money was to fund programs intended to reduce firearm-related harm and mitigate physical, financial, civil, or criminal risks associated with firearm possession. The ordinance also required proof of compliance and allowed some exemptions, including a financial-hardship exemption.

The City Council set a preliminary fee amount of $25 per gun-owning household, but the fee was not yet being enforced. The City had not designated the nonprofit, and further implementation was required before collection could begin. The ordinance provided for administrative citations and fines for violations. Although it referred to possible firearm impoundment, the City acknowledged that no state or federal law currently authorized impoundment under the ordinance.

The National Association for Gun Rights plaintiffs challenged the ordinance under the Second and First Amendments and sought related declaratory relief. The Howard Jarvis Taxpayers Association plaintiffs and other plaintiffs challenged the fee under the First Amendment, the California Constitution, and California’s rules concerning taxes and delegation of taxing power. The defendants moved to dismiss the consolidated second amended complaint under Federal Rule of Civil Procedure 12(b)(1), which addresses subject-matter jurisdiction, and Rule 12(b)(6), which addresses whether a complaint states a legally sufficient claim.

The court granted Brady’s motion for leave to appear as an amicus curiae and file a brief supporting defendants’ motion. An amicus curiae is a nonparty permitted to provide information or argument to the court.

Claim 1: Second Amendment

The National Association for Gun Rights plaintiffs alleged that both the insurance requirement and the fee provision violated the Second Amendment.

As to the insurance requirement, the court applied the framework from the Supreme Court’s decision in New York State Rifle & Pistol Association, Inc. v. Bruen. The court held that the Second Amendment’s text did not cover the conduct at issue: choosing to keep and bear arms at home without liability insurance for firearm-related accidents. The court also addressed the historical-tradition part of the Bruen framework for completeness. It concluded that nineteenth-century surety laws were sufficiently similar because both systems used financial consequences to encourage responsible firearm conduct and prevent harm. The court dismissed this portion of Claim 1 for failure to state a claim and did so without leave to amend, finding further amendment futile.

As to the fee provision, the court concluded that the challenge was ready for review because the fee had been preliminarily set at $25 and the City Manager had established financial-hardship exemption criteria. The court held that the $25 fee was not so high that it denied ordinary citizens the ability to exercise Second Amendment rights, particularly because a hardship exemption existed. It dismissed this portion of Claim 1 without leave to amend, finding amendment futile.

Claim 2: First Amendment

All plaintiffs alleged that requiring gun owners to pay the fee to a private nonprofit would force them to associate with or support that organization and fund its message. The court held that the claim was not ready for review because the City had not designated the nonprofit or identified the activities, including any expressive activities, that the fee would fund. The court dismissed Claim 2 for lack of ripeness, meaning the dispute was not sufficiently concrete for judicial review, but granted leave to amend.

Claim 3: Declaratory Relief

The declaratory-relief claim was derivative of the First and Second Amendment claims. The court dismissed it without leave to amend to the extent it was based on the Second Amendment, and with leave to amend to the extent it was based on the First Amendment.

Claim 4: California Speech and Association Rights

The Howard Jarvis Taxpayers Association plaintiffs alleged that the fee violated speech and association rights under the California Constitution. For the same reasons given for Claim 2, the court found the claim not ready for review because the nonprofit and its activities had not yet been identified. The court dismissed Claim 4 with leave to amend.

Claim 5: Unconstitutional Conditions

The Howard Jarvis Taxpayers Association plaintiffs alleged that the fee improperly conditioned continued exercise of Second Amendment rights because a gun owner who failed to pay could allegedly be forced to surrender firearms. The court rejected that interpretation of the ordinance. It explained that the ordinance allowed impoundment only to the extent permitted by law, and the parties had acknowledged that no state or federal law currently authorized such impoundment. The plaintiffs’ additional allegations about police confiscating firearms in other circumstances were too vague to state a claim. The court dismissed Claim 5 without leave to amend, unless state or federal law later changed so that impoundment became possible under the ordinance.

Claims 6 and 7: California Tax Provisions

Claim 6 alleged that the fee was a tax requiring voter approval under the California Constitution. The court relied on its earlier conclusion that the fee was not a tax because it was not payable to, or for the benefit of, the local government. The court also found that the plaintiffs had pleaded only limited facts and had not added meaningful new allegations. It granted the motion to dismiss Claim 6 and dismissed it without leave to amend.

Claim 7 alleged that the City improperly delegated its taxing and spending authority by requiring payment to a nonprofit designated by the City Manager. The court held that this claim failed because the fee was not a tax. It granted the motion to dismiss Claim 7 and dismissed it without leave to amend.

Disposition

The order states that defendants’ motions to dismiss were granted in part and denied in part. Specifically, the motion to dismiss Claim 1 was granted without leave to amend. The motions to dismiss Claims 2 and 4 were granted, with leave to amend. Claim 3 was dismissed without leave to amend as to the Second Amendment theory and with leave to amend as to the First Amendment theory. The motions to dismiss Claims 5, 6, and 7 were granted, and those claims were dismissed without leave to amend.

The court ordered the National Association for Gun Rights plaintiffs and the Howard Jarvis Taxpayers Association plaintiffs to file an amended consolidated complaint within 14 days after final implementation of the fee provision. The City was ordered to file a status report on implementation within 60 days or within seven days after enactment of the fee provision, whichever came first. The order was signed by United States District Judge Beth Labson Freeman.