1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 PETER STROJNIK, Case No.: 19-cv-02212-AJB-AHG Plaintiff, 12 ORDER GRANTING IN PART v. 13 DEFENDANT’S MOTION FOR KAMLA HOTELS, INC., DBA COSTS BOND 14 GLORIETTA BAY INN CORONADO 15 ISLAND, (Doc. No. 26) Defendant. 16 17 This case is a matter under the Americans with Disabilities Act (“ADA”). Presently 18 before the Court is Defendant Kamla Hotels, Inc.’s (“Defendant”) motion to require 19 Plaintiff Peter Strojnik (“Strojnik”) to post a costs bond. (Doc. No. 26.) Defendant asks 20 that Strojnik be required to post a $75,000 bond to cover anticipated costs and reasonable 21 attorneys’ fees likely to be incurred in the defense of this action. (See Doc. No. 26-1 at 5.) 22 Strojnik filed an opposition to Defendant’s motion, and Defendant replied. (Doc. Nos. 29– 23 30.) Having considered the parties’ submissions and the relevant law, Defendant’s motion 24 is GRANTED IN PART. 25 I. DISCUSSION 26 A. California Code of Civil Procedure § 1030 27 Although the Federal Rules of Civil Procedure do not address security bonds, federal 28 district courts “have inherent power to require plaintiffs to post security for costs.” Simulnet 1 E. Assocs. v. Ramada Hotel Operating Co., 37 F.3d 573, 574 (9th Cir. 1994). “‘Typically, 2 federal courts, either by rule or by case-to-case determination, follow the forum state’s 3 practice with regard to security for costs, as they did prior to the federal rules; this is 4 especially common when a non-resident party is involved.’” Id. (quoting 10 Wright, Miller 5 & Kane, Federal Practice and Procedure: Civil 2nd § 2671). California requires a court to 6 order a security bond when a defendant shows that: (1) the plaintiff resides out of state; 7 and (2) there is a “reasonable possibility” that the defendant will prevail on the merits. See 8 Cal. Code Civ. Proc. § 1030(a)-(c). Both elements will be addressed below. 9 Pursuant to California Code of Civil Procedure § 1030, it is appropriate to require 10 Strojnik to post a bond for costs and attorneys’ fees anticipated to be incurred. As to the 11 first element under California Code of Civil Procedure § 1030, Strojnik does not dispute 12 that he is an out-of-state plaintiff, residing in the state of Arizona. (See Second Amended 13 Complaint (“SAC”), Doc. No. 25, ¶ 3 (“Plaintiff is a single man currently residing in 14 Maricopa County, Arizona.”). “The purpose of the statute is to enable a California resident 15 sued by an out-of-state resident ‘to secure costs in light of the difficulty of enforcing a 16 judgment for costs against a person who is not within the court’s jurisdiction.’” Alshafie v. 17 Lallande, 171 Cal. App. 4th 421, 428 (2009) (quoting Yao v. Superior Court, 104 Cal. App. 18 4th 327, 331 (2002)). It further serves the purpose of preventing “out-of-state residents 19 from filing frivolous lawsuits against California residents.” Id. Defendant also points out 20 that Strojnik has left a “trail of unpaid liens, sanctions, and judgments” in both Arizona, 21 and now California. (Doc. No. 26-1 at 19.) Strojnik does not challenge this assertion. Thus, 22 this factor weighs in favor of imposing a bond requirement. 23 A bond is also appropriate under the second element of California Code of Civil 24 Procedure § 1030. A court can find that there is a “reasonable possibility” that the defendant 25 will prevail on the merits if a plaintiff’s ADA claim is “frivolous, unreasonable, or without 26 foundation”. Brown v. Lucky Stores, Inc., 246 F.3d 1182, 1190 (9th Cir. 2001) (fees and 27 costs can be awarded under the ADA only if the plaintiff’s claims were “frivolous, 28 unreasonable, or without foundation”). Here, there is a “reasonable possibility” that 1 Defendant will prevail on the merits for at least two reasons. 2 First, the Court has already ruled, in connection with Defendant’s motion to dismiss 3 the First Amended Complaint, that Strojnik failed to allege Article III standing by failing 4 to allege an injury-in-fact and deterrence. And, although leave to amend was given to 5 Strojnik, the Court has a reasonable basis to question the likelihood of success of Strojnik’s 6 claims. Specifically, Strojnik has also repeatedly failed to make such a showing of standing 7 in several other California federal courts, as affirmed by the Ninth Circuit. See, e.g., 8 Strojnik v. Pasadena Robles Acquisition, LLC, 801 F. App’x 569, 570 (9th Cir. 2020) 9 (affirming dismissal without leave to amend for failure to allege standing); Strojnik v. 10 Orangewood LLC, 829 F. App’x 783 (9th Cir. 2020) (same); Strojnik v. Four Sisters Inns, 11 Inc., No. 219CV02991ODWJEMX, 2019 WL 6700939, at *5 (C.D. Cal. Dec. 9, 2019) 12 (same); Strojnik v. IA Lodging Napa First LLC, No. 19-CV-03983-DMR, 2020 WL 13 2838814, at *6 (N.D. Cal. June 1, 2020) (collecting cases). 14 Second, Strojnik has already been declared a vexatious litigant by the United States 15 District Courts for the Northern and Central Districts of California because of his 16 unreasonable and frivolous conduct in ADA cases. See IA Lodging Napa First LLC, 2020 17 WL 2838814, *13 (“Strojnik’s litigation tactics are frivolous and harassing.”); Strojnik v. 18 SCG Am. Construction Inc., 2020 WL 4258814, *7–8 (C.D. Cal. 2020) (finding, in the 19 course of making a vexatious-litigant finding, that “Strojnik’s propensity for filing a 20 multitude of disability discrimination cases, particularly against hotel defendants, is very 21 well known,” that “countless courts have questioned Strojnik’s motives in pursuing the 22 litigation and whether he has a good faith basis for his claims,” and that “Strojnik’s history 23 contains countless filings of frivolous complaints and instances of directly ignoring court 24 orders”); Strojnik v. Forest Villas Inn II LLC, No. CV-20-08328-PCT-DWL, 2021 WL 25 2138797, at *1 (D. Ariz. May 26, 2021) (“Over the last decade, Plaintiff Peter Strojnik 26 (‘Strojnik’) has been personally responsible for the filing of hundreds, if not thousands, of 27 meritless lawsuits. In general, these ‘cookie-cutter lawsuits’ with inadequate allegations 28 have involved the assertion of claims under the Americans with Disabilities Act (‘ADA’) 1 against small businesses.”). 2 In particular, in Strojnik v. IA Lodging Napa First, the court made extensive findings 3 about Strojnik’s litigation tactics, concluding that “courts in the Ninth Circuit have 4 repeatedly admonished Strojnik for failing to allege a connection between ADA violations 5 and a plaintiff’s particular disabilities” and highlighting “Strojnik’s intransigence in 6 changing his pleadings practices despite having specific court guidance on the 7 deficiencies.” 2020 WL 2838814, at *11. The court also found that “Strojnik’s pleading 8 practices waste the resources of the court and impose unjustified costs on parties who are 9 forced to defend loosely pleaded complaints that do not allege specific facts about their 10 misconduct.” Id. at *12 (internal quotation marks and alterations omitted). In light of the 11 foregoing, there is a reasonable possibility that Defendant will prevail on the merits of this 12 action. 13 In sum, Defendant has satisfied both elements of California Code of Civil Procedure 14 § 1030, and has shown that a bond is appropriate because: (1) Strojnik is an out-of-state 15 litigant, and (2) there is a reasonable possibility that Defendant will prevail on the merits. 16 B.
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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 PETER STROJNIK, Case No.: 19-cv-02212-AJB-AHG Plaintiff, 12 ORDER GRANTING IN PART v. 13 DEFENDANT’S MOTION FOR KAMLA HOTELS, INC., DBA COSTS BOND 14 GLORIETTA BAY INN CORONADO 15 ISLAND, (Doc. No. 26) Defendant. 16 17 This case is a matter under the Americans with Disabilities Act (“ADA”). Presently 18 before the Court is Defendant Kamla Hotels, Inc.’s (“Defendant”) motion to require 19 Plaintiff Peter Strojnik (“Strojnik”) to post a costs bond. (Doc. No. 26.) Defendant asks 20 that Strojnik be required to post a $75,000 bond to cover anticipated costs and reasonable 21 attorneys’ fees likely to be incurred in the defense of this action. (See Doc. No. 26-1 at 5.) 22 Strojnik filed an opposition to Defendant’s motion, and Defendant replied. (Doc. Nos. 29– 23 30.) Having considered the parties’ submissions and the relevant law, Defendant’s motion 24 is GRANTED IN PART. 25 I. DISCUSSION 26 A. California Code of Civil Procedure § 1030 27 Although the Federal Rules of Civil Procedure do not address security bonds, federal 28 district courts “have inherent power to require plaintiffs to post security for costs.” Simulnet 1 E. Assocs. v. Ramada Hotel Operating Co., 37 F.3d 573, 574 (9th Cir. 1994). “‘Typically, 2 federal courts, either by rule or by case-to-case determination, follow the forum state’s 3 practice with regard to security for costs, as they did prior to the federal rules; this is 4 especially common when a non-resident party is involved.’” Id. (quoting 10 Wright, Miller 5 & Kane, Federal Practice and Procedure: Civil 2nd § 2671). California requires a court to 6 order a security bond when a defendant shows that: (1) the plaintiff resides out of state; 7 and (2) there is a “reasonable possibility” that the defendant will prevail on the merits. See 8 Cal. Code Civ. Proc. § 1030(a)-(c). Both elements will be addressed below. 9 Pursuant to California Code of Civil Procedure § 1030, it is appropriate to require 10 Strojnik to post a bond for costs and attorneys’ fees anticipated to be incurred. As to the 11 first element under California Code of Civil Procedure § 1030, Strojnik does not dispute 12 that he is an out-of-state plaintiff, residing in the state of Arizona. (See Second Amended 13 Complaint (“SAC”), Doc. No. 25, ¶ 3 (“Plaintiff is a single man currently residing in 14 Maricopa County, Arizona.”). “The purpose of the statute is to enable a California resident 15 sued by an out-of-state resident ‘to secure costs in light of the difficulty of enforcing a 16 judgment for costs against a person who is not within the court’s jurisdiction.’” Alshafie v. 17 Lallande, 171 Cal. App. 4th 421, 428 (2009) (quoting Yao v. Superior Court, 104 Cal. App. 18 4th 327, 331 (2002)). It further serves the purpose of preventing “out-of-state residents 19 from filing frivolous lawsuits against California residents.” Id. Defendant also points out 20 that Strojnik has left a “trail of unpaid liens, sanctions, and judgments” in both Arizona, 21 and now California. (Doc. No. 26-1 at 19.) Strojnik does not challenge this assertion. Thus, 22 this factor weighs in favor of imposing a bond requirement. 23 A bond is also appropriate under the second element of California Code of Civil 24 Procedure § 1030. A court can find that there is a “reasonable possibility” that the defendant 25 will prevail on the merits if a plaintiff’s ADA claim is “frivolous, unreasonable, or without 26 foundation”. Brown v. Lucky Stores, Inc., 246 F.3d 1182, 1190 (9th Cir. 2001) (fees and 27 costs can be awarded under the ADA only if the plaintiff’s claims were “frivolous, 28 unreasonable, or without foundation”). Here, there is a “reasonable possibility” that 1 Defendant will prevail on the merits for at least two reasons. 2 First, the Court has already ruled, in connection with Defendant’s motion to dismiss 3 the First Amended Complaint, that Strojnik failed to allege Article III standing by failing 4 to allege an injury-in-fact and deterrence. And, although leave to amend was given to 5 Strojnik, the Court has a reasonable basis to question the likelihood of success of Strojnik’s 6 claims. Specifically, Strojnik has also repeatedly failed to make such a showing of standing 7 in several other California federal courts, as affirmed by the Ninth Circuit. See, e.g., 8 Strojnik v. Pasadena Robles Acquisition, LLC, 801 F. App’x 569, 570 (9th Cir. 2020) 9 (affirming dismissal without leave to amend for failure to allege standing); Strojnik v. 10 Orangewood LLC, 829 F. App’x 783 (9th Cir. 2020) (same); Strojnik v. Four Sisters Inns, 11 Inc., No. 219CV02991ODWJEMX, 2019 WL 6700939, at *5 (C.D. Cal. Dec. 9, 2019) 12 (same); Strojnik v. IA Lodging Napa First LLC, No. 19-CV-03983-DMR, 2020 WL 13 2838814, at *6 (N.D. Cal. June 1, 2020) (collecting cases). 14 Second, Strojnik has already been declared a vexatious litigant by the United States 15 District Courts for the Northern and Central Districts of California because of his 16 unreasonable and frivolous conduct in ADA cases. See IA Lodging Napa First LLC, 2020 17 WL 2838814, *13 (“Strojnik’s litigation tactics are frivolous and harassing.”); Strojnik v. 18 SCG Am. Construction Inc., 2020 WL 4258814, *7–8 (C.D. Cal. 2020) (finding, in the 19 course of making a vexatious-litigant finding, that “Strojnik’s propensity for filing a 20 multitude of disability discrimination cases, particularly against hotel defendants, is very 21 well known,” that “countless courts have questioned Strojnik’s motives in pursuing the 22 litigation and whether he has a good faith basis for his claims,” and that “Strojnik’s history 23 contains countless filings of frivolous complaints and instances of directly ignoring court 24 orders”); Strojnik v. Forest Villas Inn II LLC, No. CV-20-08328-PCT-DWL, 2021 WL 25 2138797, at *1 (D. Ariz. May 26, 2021) (“Over the last decade, Plaintiff Peter Strojnik 26 (‘Strojnik’) has been personally responsible for the filing of hundreds, if not thousands, of 27 meritless lawsuits. In general, these ‘cookie-cutter lawsuits’ with inadequate allegations 28 have involved the assertion of claims under the Americans with Disabilities Act (‘ADA’) 1 against small businesses.”). 2 In particular, in Strojnik v. IA Lodging Napa First, the court made extensive findings 3 about Strojnik’s litigation tactics, concluding that “courts in the Ninth Circuit have 4 repeatedly admonished Strojnik for failing to allege a connection between ADA violations 5 and a plaintiff’s particular disabilities” and highlighting “Strojnik’s intransigence in 6 changing his pleadings practices despite having specific court guidance on the 7 deficiencies.” 2020 WL 2838814, at *11. The court also found that “Strojnik’s pleading 8 practices waste the resources of the court and impose unjustified costs on parties who are 9 forced to defend loosely pleaded complaints that do not allege specific facts about their 10 misconduct.” Id. at *12 (internal quotation marks and alterations omitted). In light of the 11 foregoing, there is a reasonable possibility that Defendant will prevail on the merits of this 12 action. 13 In sum, Defendant has satisfied both elements of California Code of Civil Procedure 14 § 1030, and has shown that a bond is appropriate because: (1) Strojnik is an out-of-state 15 litigant, and (2) there is a reasonable possibility that Defendant will prevail on the merits. 16 B. Other Simulnet Factors 17 In determining whether to order the posting of a bond, federal courts may also 18 consider additional factors such as: “(i) the degree of probability/improbability of success 19 on the merits, and the background and purpose of the suit; (ii) the reasonable extent of the 20 security to be posted, if any, viewed from the defendant’s perspective; and (iii) the 21 reasonable extent of the security to be posted, if any, viewed from the nondomiciliary 22 plaintiff’s perspective.” Simulnet, 37 F.3d at 573 (citations omitted). The Court will address 23 all three factors below. 24 For the first factor, as stated above, Defendant has shown a reasonable probability 25 of success in this matter given that an overwhelming number of district courts have 26 dismissed Strojnik’s ADA claims based on substantially similar complaints. (Doc. No. 26- 27 1 at 8 n.1 (collecting cases).) In considering the background and purpose of the present 28 suit, it is not lost upon the Court that Strojnik has been declared a vexatious litigant in both 1 the Northern and Central Districts of California. 2 Secondly, looking to the reasonable extent of the bond to be posted from Defendant’s 3 perspective, Defendant requests that the Court require Strojnik to post a $75,000 bond. In 4 support of this bond amount, Defendant offers the declaration of its attorney, Philip H. 5 Stillman. (Doc. No. 26-2.) Mr. Stillman estimates he will expend at least $33,100 in costs 6 on this litigation and will likely incur $114,600 in attorney’s fees if required to litigate this 7 case through trial. (Id. ¶¶ 17, 26.) Mr. Stillman also asserts that he has already expended 8 35 hours of time, or $17,500, in preparing two motions to dismiss in this case. (Id. ¶ 26.) 9 Although Mr. Stillman requests a bond of $75,000, the Court notes that federal courts in 10 California have awarded more modest fees and costs in similar cases brought by Strojnik. 11 See, e.g., Strojnik v. 1017 Coronado, Inc., No. 19-CV-02210-BAS-MSB, 2021 WL 12 120899, at *5 (S.D. Cal. Jan. 13, 2021) (awarding the defendant $21,995 in attorney’s fees); 13 In light of this case law and the Stillman declaration, the Court finds a bond of $20,000 14 appropriate here. 15 Third, as to the reasonable extent of the security to be posted, viewed from Strojnik’s 16 perspective, Defendant persuasively points out that Strojnik has the financial ability to post 17 bond. First, Defendant highlights that Strojnik admitted in prior litigation that he has 18 received $249,079 in 117 ADA settlements in California federal courts as of March 2020. 19 See IA Lodging Napa First LLC, 2020 WL 2838814, at *7 (“The spreadsheet lists the 20 estimated costs he expends for each lawsuit and reports that the gross total amount he has 21 received in settlement is $249,079.”). Likewise, in another case out of the District of 22 Arizona, a court ordered Strojnik to provide an estimate of the amount of settlements 23 Strojnik has received in Arizona courts in 2020. The court calculated that Strojnik “has 24 settled thirteen cases, which would amount to just over $100,000. Even if the Court 25 accepted Mr. Strojnik’s claimed ‘initial expenses’ beyond fees and service costs as 26 legitimate, he would still be making about $75,000.” Driftwood Hosp. Mgmt. LLC, 2021 27 WL 50456, at *8 (D. Ariz. Jan. 6, 2021). 28 Second, Defendant asserts that Strojnik has admitted in prior cases that he donated ! $1.2 million “of his ADA fees to a 501(c)(3) organization for the disabled.” (Strojnik v. IA 2 Lodging Napa First LLC, Case No.: 4:19-cv-03983-DMR, Doc. No. 56 at 3 (N.D. Cal. 3 || Mar. 21, 2020).) Additionally, Defendant argues that Strojnik appears to reside in a house 4 || with an estimated value of $1.6 million dollars. (Doc. No. 26-1 at 19-20.) In response to > || Defendant’s evidence, Strojnik does not substantially dispute these allegations, and only 6 vaguely states that he is “subject to a publicly recorded 2013 divorce lien and that there is 7 \Ino way he can post a bond in any amount.” (Doc. No. 29 at 2.) 8 Based on all the evidence submitted, the Court is not convinced that a bond would ? || be unreasonable. Strojnik has failed to put forth competent evidence to demonstrate his 10 inability to post a bond. As such, the Court finds a bond appropriate under these facts, and joins other district courts that have found the posting of a bond appropriate in cases brought 12 by Strojnik. See e.g., Strojnik v. Driftwood Hosp. Mgmt. LLC, No. CV-20-00343-PHX- 13 DJH, 2021 WL 50456, at *11 (D. Ariz. Jan. 6, 2021), order amended on reconsideration, 14 |INo. CV-20-01532-PHX-DJH, 2021 WL 2454049 (D. Ariz. June 16, 2021) (“Therefore, the || Court must increase Mr. Strojnik’s cost of filing frivolous ADA cases by requiring that he 16 post a bond for ADA cases that come before this Court.”). 17 CONCLUSION 18 For all the reasons stated, Defendant’s motion to require Strojnik to post a costs bond 19 GRANTED IN PART. (Doc. No. 26.) Strojnik must post a $20,000 bond by August 20 |) 13, 2021. The parties are to notify the Court, by August 13, 2021, of whether a bond has 21 timely posted. Failure to timely post bond by will result in dismissal of Strojnik’s 22 || case. In the event a bond is posted, Defendant is ORDERED to respond to the SAC within 23 ||14 days of the posting of bond. 24 IT IS SO ORDERED. 25 Dated: July 30, 2021 26 Hon. Anthony J Hatta 27 United States District Judge 28