Gilbert v. Dabb Liquor Incorporated

Opinion

2 3 4 5 6 7 10 DARREN GILBERT, 11 Case No. 1:22-cv-00485-JLT-SKO Plaintiff, 12

v. ORDER DISCHARGING ORDER TO 13 SHOW CAUSE 14 FINDINGS AND RECOMMENDATIONS 15 DABB LIQUOR INCORPORATED dba P J TO DECLINE SUPPLEMENTAL Market, et al., JURISDICTION OVER PLAINTIFF’S STATE LAW CLAIMS 16 Defendants. (Docs. 1, 14, 15) 17

18 14 DAY DEADLINE _________________________________ ___/ 19 I. INTRODUCTION 20 21 On April 24, 2022, Plaintiff Darren Gilbert (“Plaintiff”) filed his Complaint against 22 Defendants Dabb Liquor Incorporated dba P J Market and Paramjit Singh alleging claims under the 23 American with Disabilities Act (ADA), California’s Unruh Civil Rights Act, and California’s Health 24 and Safety Code. (Doc. 1). These claims stem from alleged barriers Plaintiff encountered (such as 25 an uneven path of travel) while he visited a facility owned, operated, or leased by Defendants—PJ 26 Market. (See id.) No defendant has appeared. Plaintiff has obtained a clerk’s entry of default 27 against Defendants but has not yet moved for entry of default judgment. (Docs. 10 & 11.) 28 On March 20, 2023, the undersigned ordered Plaintiff to show cause why the Court should 1 not decline to exercise supplemental jurisdiction over his Unruh Act claim in light of the Ninth 2 Circuit’s decision in Vo v. Choi. (See Doc. 14.); Vo v. Choi, 49 F.4th 1167 (9th Cir. 2022) (affirming 3 a district court’s decision to decline supplemental jurisdiction over an Unruh Act claim); see 28 4 U.S.C. § 1367(c). Plaintiff timely filed a response on April 3, 2023. (Doc. 15.) For the reasons discussed below, the undersigned shall discharge the order to show cause and shall recommend that 5 supplemental jurisdiction over Plaintiff’s Unruh Act claim, as well as his California Health & Safety 6 Code claims, be declined and those claims be dismissed without prejudice. 7 9 Under 28 U.S.C. § 1367(a), a court that has original jurisdiction over a civil action “shall 10 have supplemental jurisdiction over all other claims that are so related to claims in the action within 11 such original jurisdiction that they form part of the same case or controversy under Article III of the 12 United States Constitution.” The Ninth Circuit has concluded that ADA and Unruh Act claims that 13 derive from a common nucleus of operative fact “form part of the ‘same case or controversy’ for 14 purposes of § 1367(a).” Arroyo v. Rosas, 19 F.4th 1202, 1209 (9th Cir. 2021). 15 However, even where supplemental jurisdiction over a claim exists under § 1367(a), the 16 Court may decline jurisdiction over the claim under § 1367(c) if: 17 (1) the claim raises a novel or complex issue of State law, (2) the claim substantially predominates over the claim or claims over which the 18 district court has original jurisdiction, 19 (3) the district court has dismissed all claims over which it has original jurisdiction, or 20 (4) in exceptional circumstances, there are other compelling reasons for declining 21 jurisdiction. 22 § 1367(c)(1)-(4). 23 Pertinent here, a court deciding whether to apply § 1367(c)(4) must make “a two-part 24 inquiry.” Arroyo, 19 F.4th at 1210. “First, the district court must articulate why the circumstances 25 of the case are exceptional within the meaning of § 1367(c)(4).” Id. (citations and internal quotation 26 marks omitted). “Second, in determining whether there are compelling reasons for declining 27 jurisdiction in a given case, the court should consider what best serves the principles of economy, 28 convenience, fairness, and comity which underlie the pendent jurisdiction doctrine articulated in 1 [United Mine Workers of Am. v. Gibbs, 383 U.S. 715 (1966)].” Id. (citations and internal quotation 2 marks omitted). 3 After considering § 1367(c)(4) and California’s requirements for bringing Unruh Act claims, 4 “[n]umerous federal district courts across California have declined to exercise supplemental 5 jurisdiction over Unruh Act . . . claims brought alongside ADA claims.” Rutherford v. Nuway Ins. 6 Agency Inc., No. SACV 21-00576-CJC-JDE, 2021 WL 4572008, at *1 (C.D. Cal. Apr. 1, 2021). 7 Underlying these decisions is “the recent confluence of several California-law rules [that] have 8 combined to create a highly unusual systemic impact on ADA-based Unruh Act cases that clearly 9 threatens to have a significant adverse impact on federal-state comity.” Arroyo, 19 F.4th at 1211. 10 Notably, Congress adopted the ADA to address the discrimination encountered by persons 11 with disabilities, providing a private cause of action to seek injunctive, but not monetary, relief. See 12 Arroyo v. Rosas, 19 F.4th 1202, 1205 (9th Cir. 2021) (discussing background and relief available 13 under the ADA). The Unruh Act likewise prohibits disability discrimination, containing a provision, 14 Cal. Civ. Code § 51(f), stating that a violation of the ADA also violates the Unruh Act. However, 15 unlike the ADA, the Unruh Act allows a plaintiff to recover “up to a maximum of three times the 16 amount of actual damage but in no case less than four thousand dollars.” Cal. Civ. Code § 52(a). 17 In response to perceived abuses of the Unruh Act, California has enacted requirements for 18 bringing such claims, which requirements the Ninth Circuit has assumed, without deciding, “apply 19 only in California state court.” Vo, 49 F.4th at 1170. For example a provision was added (1) 20 regarding the contents of demand letters, Cal. Civ. Code § 55.31; (2) imposing heightened pleading 21 requirements, Cal. Civ. Code § 425.50(a); and (3) requiring an additional filing fee of $1,000 for so 22 called “high-frequency litigants,” Cal. Gov’t Code § 70616.5(b), see Cal. Civ. Code § 425.55(b) 23 (defining a high-frequency litigant to include “[a] plaintiff who has filed 10 or more complaints 24 alleging a construction-related accessibility violation within the 12-month period immediately 25 preceding the filing of the current complaint alleging a construction-related accessibility 26 violation.”). 27 All of these requirements1 apply to claims alleging a construction-related accessibility 28 1 violation, defined as involving “a provision, standard, or regulation under state or federal law 2 requiring compliance with standards for making new construction and existing facilities accessible 3 to persons with disabilities,” including those related to the ADA. Cal. Civ. Code § 55.52(a)(1), (6); 4 see Cal. Civ. Code § 55.3(a)(2). By enacting such restrictions, California has expressed a “desire 5 to limit the financial burdens California’s businesses may face from claims for statutory damages 6 under the Unruh Act.” Arroyo, 19 F.4th at 1209 (internal quotations omitted). However, “Unruh 7 Act plaintiffs have evaded these limits by filing in a federal forum in which [they] can claim these 8 state law damages in a manner inconsistent with the state law’s requirements.” Arroyo, 19 F.4th at 9 1213 (internal quotation marks omitted). Consequently, “the procedural strictures that California 10 put in place have been rendered largely toothless, because they can now be readily evaded.” Id. 11 Recently, the Ninth Circuit provided substantial guidance on this issue in Vo v. Choi in 12 affirming a district court’s order denying supplemental jurisdiction over an Unruh Act claim under 13 § 1367(c)(4). Vo, 49 F.4th at 1168. In that case, the district court declined supplemental jurisdiction 14 over the Unruh Act claim after giving the plaintiff the opportunity to respond and before addressing 15 the merits of the case. Id. at 1168-69. In reviewing the district court’s decision, the Ninth Circuit 16 held that the district court sufficiently explained why the circumstances of the case were exceptional 17 under § 1367(c)(4), agreeing with the district court that “it would not be ‘fair’ to defendants and ‘an 18 affront to the comity between federal and state courts’ to allow plaintiffs to evade California’s 19 procedural requirements by bringing their claims in federal court.” Id. at 1171. The Court also 20 affirmed the district court’s finding that the balance of the Gibbs values—economy, convenience, 21 fairness, and comity—provided compelling reasons to decline supplemental jurisdiction, stating that 22 “the district court [properly] analyzed Vo’s situation under the Gibbs values and determined that the 23 values of fairness and comity favored not retaining jurisdiction over the claim.” Id. at 1172. 24 Accordingly, “[g]iven these very real concerns, in addition to the deferential standard of review, 25 [the Ninth Circuit saw] no reason to hold that the district court abused its discretion in determining 26 there were compelling reasons to decline jurisdiction over the Unruh Act claim.” Id. 28 The Court begins with the first part of the two-step inquiry under § 1367(c)(4)—whether the 1 circumstances here are exceptional. Vo, 49 F.4th at 1171. 2 As discussed above, California has enacted various requirements that apply to claims 3 alleging a construction-related accessibility violation. If the Court were to exercise jurisdiction over 4 Plaintiff’s Unruh Act claim, Plaintiff would be permitted to avoid these requirements. See Arroyo, 5 19 F.4th at 1213 (noting that potential evasion of California’s requirements met exceptional- 6 circumstances prong of § 1367(c)(4)). Further, such evasion would undermine California’s policy 7 interests in enforcing its requirements—providing monetary relief but limiting burdens on small 8 businesses and disincentivizing plaintiffs’ attorneys from obtaining “monetary settlements at the 9 expense of forward-looking relief that might benefit the general public.” Id. Plaintiff offers no 10 argument for why such circumstances should not be deemed exceptional, and there is “little doubt 11 that the first prong [under § 1367(c)(4)] is satisfied here.” Vo, 49 F.4th at 1171. See also Garcia v. 12 Maciel, No. 21-CV-03743-JCS, 2022 WL 395316, at *2 (N.D. Cal. Feb. 9, 2022) (collecting cases). 13 Turning to the second part of the inquiry—whether there are other compelling reasons for 14 declining jurisdiction—the Court considers the Gibbs values of economy, convenience, fairness, 15 and comity. Vo, 49 F.4th at 1171. Importantly, this case is an early stage of the litigation—no 16 Defendant has appeared. While Plaintiff has obtained a clerk’s entry of default against Defendants, 17 he has not yet moved for default judgment, and thus, the merits of Plaintiff’s claims have not yet 18 been addressed. See Arroyo, 19 F.4th at 1214 (noting that the Gibbs values did not support declining 19 supplemental jurisdiction where the case was at a “very late stage”). This is not a case “where it 20 makes no sense to decline jurisdiction . . . over a pendent state law claim that that court has 21 effectively already decided.” Id. Notably, Plaintiff makes no argument that the stage of this case 22 warrants exercising jurisdiction. 23 Moreover, in light of the above discussion of California’s requirements for Unruh Act 24 claims, it would not be fair, nor would comity be served, by allowing Plaintiff’s Unruh Act claim to 25 proceed without the state court being able to enforce its policy interests as reflected in its various 26 procedural requirements. Id. at 1213 (noting “comity-based concerns that California’s policy 27 objectives in this area were being wholly thwarted” by plaintiffs being able to bring Unruh Act 28 claims in federal court). On this issue, Plaintiff concedes in his response to the show cause order 1 that he would be considered a high-frequency litigant and would otherwise have to meet certain 2 California requirements, such as paying the $1,000 filing fee in state court.2 (Doc. 15 at 2 (“Plaintiff 3 acknowledges that he would be considered a high-frequency litigant under California law as he filed 4 more than ten construction-related accessibility claims in the twelve months preceding the filing of 5 the instant action.”).) 6 Plaintiff raises two arguments for why the Court should exercise jurisdiction. First, Plaintiff 7 states that his complaint meets the heightened pleading requirements of § 425.50. (See Doc. 15 at 8 2.) At this stage, however, the Court only need to determine whether California’s requirements are 9 implicated, not whether they are in fact met. As Vo noted, whether a Plaintiff “has satisfied the 10 heightened pleading requirements” imposed in California is a question for the state court because 11 “[f]orcing the district court to determine if [this is] in fact true would itself run afoul of the Gibbs 12 values—especially comity,” and would deprive California of playing its “critical role in effectuating 13 the policies underlying [its] reforms.” Vo, 49 F.4th at 1173-74 (internal citation omitted). 14 Second, Plaintiff contends that requiring him to bring a second action in state court “would 15 be duplicative and would only increase the ultimate burden on the subject business, as Plaintiff 16 would be entitled to seek recovery of the additional attorney’s fees and costs spent bringing the 17 second action.” (Doc. 15 at 3.) As an initial matter, this argument improperly assumes that Plaintiff 18 will be successful in this action. Even accepting such an assumption, the fact that the litigation 19 could prove duplicative or increase costs does not, in light of the other considerations, warrant 20 retaining jurisdiction. As one court has concluded, “if plaintiff legitimately seeks to litigate this 21 action in a single forum, plaintiff may dismiss this action and refile it in a state court in accordance 22 with the requirements California has imposed on such actions.” Garibay v. Rodriguez, No. CV 18- 23 9187 PA (AFMX), 2019 WL 5204294, at *6 (C.D. Cal. Aug. 27, 2019). Moreover, it is California’s 24 prerogative to impose a heightened filing fee for high-frequency litigants in an effort to curb abuses 25 of the Unruh Act at the risk of the fee being ultimately paid by defendants. It would undermine 26 comity and fairness were Plaintiff permitted to proceed with his Unruh Act claim in light of 27 2 While the Court acknowledges Plaintiff’s concession, it need not determine whether he is in fact a high-frequency 28 litigant. Vo, 49 F.4th at 1174 (noting that court was not required to determine whether the plaintiff was in fact a high- 1 California’s policy concerns. 2 Accordingly, considering the two-step inquiry under § 1367(c)(4), the undersigned 3 concludes that this case presents “exceptional circumstances” such that “there are other compelling 4 reasons for declining [supplemental] jurisdiction” over Plaintiff’s Unruh Act and Health & Safety 5 Code claims.3 7 The Court’s order to show cause (Doc. 14) is hereby DISCHARGED. For the reasons given 8 above, IT IS RECOMMENDED as follows: 9 1. Pursuant to 28 U.S.C. § 1367(c)(4) and Vo v. Choi, 49 F.4th 1167 (9th Cir. 2022), 10 the Court DECLINE to exercise supplemental jurisdiction over Plaintiff’s Unruh Act 11 claim and Plaintiff’s Cal. Health & Safety Code § 19955 and § 19959 claims; and 12 2. Plaintiff’s Unruh Act and Cal. Health & Safety Code § 19955 and § 19959 claims be 13 DISMISSED WITHOUT PREJUDICE pursuant to 28 U.S.C. § 1367(c)(4). 14 These findings and recommendations will be submitted to the United States District Judge 15 assigned to the case, pursuant to the provisions of Title 28 U.S.C. § 636(b)(1). Within fourteen 16 (14) days after being served with these findings and recommendations, any party may file written 17 objections with the Court. The document should be captioned “Objections to Magistrate Judge’s 18 Findings and Recommendations.” The parties are advised that failure to file objections within the 19 specified time may result in the waiver of rights on appeal. Wilkerson v. Wheeler, 772 F.3d 834, 20 838-39 (9th Cir. 2014) (citing Baxter v. Sullivan, 923 F.2d 1391, 1394 (9th Cir. 1991)). 21 IT IS SO ORDERED. 22

23 Dated: April 14, 2023 /s/ Sheila K. Oberto . UNITED STATES MAGISTRATE JUDGE 24

27 3 Plaintiff’s California Health & Safety Code claims are subject to the same heightened pleading and filing requirements as his Unruh Act claim. See Gilbert v. Singh, No. 1:21cv1338-AWI-HBK, 2023 WL 2239335, *2 (E.D. Cal. Feb. 27, 28 2023). Therefore, the same considerations that counsel against maintaining supplemental jurisdiction over Plaintiff’s