Olympus Spa v. Ortiz

CourtDistrict Court, W.D. Washington
DecidedNovember 13, 2023
Docket2:22-cv-00340
StatusUnknown

This text of Olympus Spa v. Ortiz (Olympus Spa v. Ortiz) is published on Counsel Stack Legal Research, covering District Court, W.D. Washington primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Olympus Spa v. Ortiz, (W.D. Wash. 2023).

Opinion

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5 6 7 UNITED STATES DISTRICT COURT 8 WESTERN DISTRICT OF WASHINGTON AT SEATTLE 9 10 OLYMPUS SPA, et al., CASE NO. 22-CV-00340-BJR 11 Plaintiffs, ORDER GRANTING MOTION TO 12 v. DISMISS AMENDED COMPLAINT 13 ANDRETA ARMSTRONG, MADISON IMIOLA, 14 Defendants. 15 16 This matter comes before the Court on a Motion to Dismiss filed by Defendants Andreta 17 Armstrong, Executive Director of the Washington State Human Rights Commission (“HRC”), and 18 Madison Imiola, an investigator with HRC (“Defendants”), seeking dismissal of the Amended 19 Complaint filed by Plaintiffs Olympus Spa (the “Spa”), “Jane Doe Employee 1,” and “Jane Doe 20 Patron 1” (“Plaintiffs”).1 21 22

23 1 The original complaint was also brought by Myoon Woon Lee and Sun Lee, the owner and president, respectively, of Olympus Spa. See Compl., Dkt. No. 1, ¶¶ 4 and 5. These individuals are not named plaintiffs in the Amended 24 Complaint. 1 This lawsuit was originally filed as a First Amendment challenge to HRC’s application of 2 the Washington Law Against Discrimination (“WLAD”) to Olympus Spa’s admittance policy. See 3 Compl., Dkt. No. 1; Wash. Rev. Code § 49.60 et seq. On June 5, 2023, the Court issued an order 4 granting Defendant’s Motion to Dismiss the Complaint and dismissed Plaintiffs’ Free Exercise,

5 Free Speech, and Free Association claims. At the same time, the Court granted Plaintiffs leave to 6 file an amended complaint and a second opportunity to state claims upon which relief could be 7 granted. See Order Granting Motion to Dismiss, Dkt. No. 21 (“June 5 Order”). Plaintiffs filed a 8 timely amended complaint, restating their First Amendment claims and adding federal procedural 9 and substantive Due Process Clause claims and a Religious Freedom claim under Article I, Section 10 11 of the Washington State Constitution. Am. Compl., Dkt. No. 24. Defendants again moved to 11 dismiss Plaintiffs’ claims. Dkt. No. 28. Having reviewed the briefs and exhibits filed in support of 12 and opposition to the motion, the Court finds and rules as follows. 13 I. BACKGROUND 14 The facts of this case were thoroughly outlined in the Court’s June 5 Order and need not

15 be repeated in full here. In sum, Plaintiff Olympus Spa, with two locations in the Great Puget 16 Sound Area, is a spa “specifically designed for women.” Am. Compl., ¶¶ 3, 11. The services 17 offered there “are closely tied to the Korean tradition,” meaning patrons are “require[d] . . . to be 18 naked” during certain services. Id.; see also id., ¶ 21 (“It is Olympus Spa’s business purpose to 19 provide traditional Korean kiln saunas and exfoliation therapy experiences.”). As noted, patrons 20 are “typically fully naked” while utilizing the Spa’s massage, bath, and other areas and thus “have 21 visual access” to other nude patrons. Id. 22 Until 2021, Olympus Spa maintained a “biological women” only policy, under which it 23 restricted admission to women, which it defined as individuals who “physically present[] in the

24 nude as . . . female.” Id., ¶ 26, 39. Thus the Spa’s policy was to admit transgender women only if 1 they had “gone through post-operative sex confirmation surgery.” Id., ¶ 26. Plaintiffs attribute the 2 policy to the owners’ “traditional, theologically conservative” Christian values. Id., ¶ 25. The 3 owners “hold the conviction that a male and female should not ordinarily be in each other’s 4 presence while in the nude unless married to each other.” Id.

5 In February 2020, HW2—a transgender woman who “identifies as a woman” who at the 6 time had not undergone sex reassignment surgery—filed a complaint with HRC. HW alleged that 7 she had gone to Olympus Spa in January 2020 but was denied entry “because of [her] sexual 8 orientation.” Am. Compl., Ex. 3 at 2. According to the complaint, HW was told “that transgender 9 women without surgery are not welcome because it could make other customers and staff 10 uncomfortable.” Id. Plaintiffs have consistently denied that HW visited the Spa in person, noting 11 in their Amended Complaint that HW has made statements to the media indicating she merely 12 made a telephone call to the Spa inquiring about its admittance policy. Am. Compl., ¶ 35. Plaintiffs 13 do not deny that in February 2020, HW would not have been admitted under its then-existing 14 policy.

15 HRC subsequently served the Spa with a Notice of Complaint of Discrimination. Am. 16 Compl., Ex. 3. The Notice outlined HW’s allegations and sought the Spa’s written response. It 17 also apprised Olympus Spa of HRC’s early resolution services: “The WSHRC may assist the 18 parties in early resolution of this Complaint through joint fact finding conferences and/or 19 settlement negotiation which gives the parties an opportunity to resolve the issues . . . without 20 extensive investigation or expenditure of resources.” Id. Olympus Spa was invited to contact the 21 assigned Civil Rights Investigator, Defendant Madison Imiola, if it was interested in settlement. 22 Id. 23 2 Defendants request that complainant be referred to by her initials HW, as she has received threats of violence as a 24 consequence of her association with this lawsuit. 1 In subsequent correspondence with HRC, Plaintiffs defended the Spa’s entry policy. Am. 2 Compl., Ex. 3 at 10-12. The Spa provided HRC with a copy of that policy, which stated, 3 “Biological women are welcome[.] It is the policy of Olympus Spa not to discriminate on the basis 4 of race, color, national original, sex, age, or disability in its programs or activities, as required by

5 applicable laws and regulations.” Am. Compl., Ex. 3 at 13. The Spa’s president further explained 6 that “[o]ur attendance rules limit guests to females only, including post-operative transsexuals.” 7 Id. at 11. Plaintiffs also denied that HW had visited the Spa. Id. at 18. In response, HRC, through 8 Imiola, informed Plaintiffs that by maintaining a policy that refused entry to transgender women 9 who had not had surgery, the Spa was violating the WLAD because it discriminated on the basis 10 of gender identity. Id. at 15. Imiola again offered the Spa “the opportunity to enter into a Pre- 11 Finding Settlement (PFS) Agreement.” Id. at 15. As her letter explained, such settlement 12 agreements are “used to resolve the issues of a complaint prior to completing the investigative 13 process.” Id. Such an agreement would not require an admission of guilt, and HRC “would take 14 no further action on the issues of the complaint.” Id. In sum, a PFS Agreement was Olympus Spa’s

15 “opportunity” to “revise [its] policies and practices,” bring itself “into compliance with the law, 16 avoid the costs of non-compliance and litigation, and reduce the likelihood of future complaints.” 17 Id. 18 The Spa ultimately removed the “biological women only” entry policy from its website 19 and elected to enter into a PFS agreement with HRC. See Am. Compl., Ex. 3 at 22, 30-32. Under 20 the agreement, Olympus Spa was required to complete WLAD training within 60 days. Id. It was 21 allotted 60 days to “[i]mplement and/or revise existing company policies as necessary to ensure 22 their compliance with the [WLAD].” Id. at 36. The PFS agreement also reserved the Spa’s right to 23 challenge HRC’s application of the WLAD to the entry policy. Id. at 37. In October 2021, HRC

24 issued a notice of final agency action and officially closed the complaint. See id. at 34–39. 1 Plaintiffs first brought this Section 1983 suit alleging that enforcement of the WLAD 2 against them violated their First Amendment rights to free exercise of religion, freedom of speech, 3 and freedom of association. Compl., Dkt. No. 1 at 1, 13–15. Plaintiffs sought declaratory relief 4 and asked the Court to “preliminarily and permanently” enjoin HRC from “enforcing the public

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Olympus Spa v. Ortiz, Counsel Stack Legal Research, https://law.counselstack.com/opinion/olympus-spa-v-ortiz-wawd-2023.