It’s been a year and 43 blogs since last President’s Day and like Yosemite falls, the broad picture of ADA and FHA litigation in America remains about the same despite the passage of time. A huge majority of the cases filed are from serial litigants operating as part of a lawyer sponsored litigation machine whose goals have nothing to do with accessibility and everything to do with making money. Congressional action aimed at serial litigation was misguided and is now doomed. Individual judges are taking important stances against abusive litigation, but the overall landscape remains about the same.
Something for everyone
Stiner v. Brookdale Senior Living, Inc., 2019 WL 330911 (N.D. Cal. Jan. 25, 2019) touches on a number of important issues, beginning with arbitration of ADA claims. The Court denied the defendants’ motion to compel arbitration on contractual grounds, but not based on public policy or other more general principles. A contract requiring arbitration of ADA claims arising under Title III might be enforceable, and for public accommodations whose relationship with patrons is based on a written contract arbitration might be a viable option.
The Court then turned to class action allegations. The plaintiffs were residents of an assisted living facility but sued on behalf of a purported class including all the facilities operated by the owner. Because the plaintiffs had standing to sue with respect to one facility the Court found they had standing at the initial pleading stage to act as class representatives. Those interested in more detail on class actions in the ADA context should check William Goren’s recent blog “Egregious Fitness for Duty Policy Leads to Class Action Certification”
The Court made short work of a claim that assisted living facilities were not ADA but FHA facilities, finding that the services offered made it more like a public accommodation and citing a number of similar earlier cases. It also rejected an effort to dismiss a policy discrimination claim based on alleged under-staffing although without the discussion the issue deserved. The essence of the plaintiffs’ claim was that they did not get adequate services because of understaffing. This was disability discrimination, they claimed, because they needed more services than non-disabled residents. The Court rejected an argument that the lack of services affected all residents equally, finding that some services were only needed by disabled residents. Neither the Court nor the defendants addressed the application of 28 CFR §36.306, which specifically provides that Title III entities are not required to provide “services of a personal nature including assistance in eating, toileting, or dressing.” At the heart of the ADA is a principle of equal access to public accommodations, not equal enjoyment of those premises, and services unrelated to accessibility are simply not required.
Speaking of arbitration
Natl. Fedn. of the Blind v. Container Store, Inc., 2019 WL 634783 (D. Mass. Feb. 13, 2019) is the continuation of a dispute concerning the arbitration requirement contained in a click type contract between the Container Store and any customer. Customers generally have access to the contract only when using an electronic POS device that is not accessible to the blind. The First Circuit found the arbitration agreement to be unenforceable in Natl. Fedn. of the Blind v. The Container Store, Inc., 904 F.3d 70 (1st Cir. 2018) and remanded the case to the district court for further proceedings.** Smelling victory, the Federation sought to bypass any further proceedings and leap to a final judgment and injunction. The Court declined, finding that while the arbitration agreement was not enforceable, the issue of whether there was an ADA violation remained to be tried. The central lesson remains the same, however. An arbitration clause that is made available only in a format that the blind cannot access will not be enforceable.
In Perry v. Strategic Realty Capital, LLC, 2019 WL 384000 (M.D. La. Jan. 30, 2019) the plaintiff escaped dismissal by one day. The FHA has a two year statute of limitations that would have expired on December 23, 2017 but for the fact that the 24th and 25th were a Saturday and Sunday, while on the 26th the clerk’s office was closed. December 26 is not a legal holiday, but the Court found that the filing deadline was delayed by the rule concerning inaccessibility of the clerk’s office in Rule 6. Lawyers take note – sometimes those technical rules really matter.
Serial ADA Litigants
Brooke v. Kashl Corp., 2019 WL 329532 (S.D. Cal. Jan. 25, 2019) asks without answering the question of whether a plaintiff can survive a Rule 12(b)(6) motion and still be a vexatious litigant. Brooke is an extremely active serial filer with more than 650 lawsuits filed in the last few years. Her claim against Kashl Corp. was typical. She claimed there were physical barriers at the defendant’s hotel and that no accessible rooms were available. The Court had little trouble finding that despite her many lawsuits her allegations in a verified petition showed the requisite harm and intent to return. The Court then turned to the defendant’s motion to declare Brooke a vexatious litigant based on the assertion that she filed suits just to extort money from defendants. For reasons that aren’t clear, but probably relate to the sheer administrative work required by the hundreds of suits Brooke has pending, she did not respond to the motion. While that would ordinarily result in a loss, the sanction sought – limited access to federal courts – is so serious the Court found Brooke should be given a second chance, setting a Feb. 1, 2019 deadline for a response in opposition. Before that deadline arrived the case settled on terms that can’t be determined from the file, but presumably favored the defendant. A determined defendant can fight back and even improve its settlement position against a serial litigant – the question is at what cost?
Johnson v. Starbucks Corp., 2019 WL 402359 (N.D. Cal. Jan. 31, 2019) is another example of a determined defense making real progress. After losing on a Motion for Summary Judgment Starbucks obtained evidence in other cases suggesting that Johnson had never actually visited the Starbucks in question and asked that the MSJ be set aside. After considering the matter, including similar proceedings in a related case in another court, the Court held the motion in abeyance but permitted additional discovery on the issue. This case and the one it cites are a model for how defendants might defeat serial litigants who simply lie about their visits to a facility. It is notable, however, that the Court only allowed discovery related to the one case before it. Eliminating abusive serial litigation is like killing an ant colony – it cannot be done one ant at a time. Unless and until federal courts are willing to accept the relevance of a plaintiff’s entire pattern of behavior at the dismissal stage of a lawsuit serial filers like Johnson will continue to flourish.
A different Johnson avoided dismissal in the Southern District of Florida in Johnson v. Griffin Prop. Inv., LLC, 2019 WL 451190 (S.D. Fla. Feb. 5, 2019). The case is most interesting for the Court’s rejection of an examination of the plaintiff’s motives for filing suit. Following earlier cases the Court found that the right to be free from discrimination applied regardless of the plaintiff’s motive for visiting the facility. The case was decided on a motion to dismiss, so the Court never considered the effect of motive on a claim of intent to return. At trial, when the truth don’t lie, serial litigants are unlikely to be able to persuade anyone their claim of an intent to return is true.†
In Gastelum v. Phoenix C. Hotel Venture, LLC, 2019 WL 498750, (D. Ariz. Feb. 8, 2019) Judge Rayes took a refreshingly practical look at the plaintiff’s rote allegations and concluded the plaintiff had failed to adequately plead standing. The court found two problems. First, the plaintiff never tied the alleged ADA violations to his particular disability or his inability to access the premises. In keeping with a few recent cases the court implicitly rejected the “dignitary harm” notion‡ that merely knowing of a violation created some kind of harm, finding for example that merely alleging a cross slope was too steep did not allege an injury without some allegation it interfered with the plaintiff’s access to the premises. The court also rejected an “intent to return” allegation that failed to include any particulars that might make it credible. The death of serial litigation will come when courts are willing to take the pleading requirements in Rule 8 seriously, thus forcing serial litigants to either suffer dismissal or lie, an unattractive choice for both the plaintiff and his lawyer.
Default as a strategy
Kennedy v. U and V Food Corp., 2019 WL 343201 (M.D. Fla. Jan. 10, 2019), report and recommendation adopted, 2019 WL 338914 (M.D. Fla. Jan. 28, 2019) is a case in which default worked as a perfect strategy because the court simply refused to enter judgment on a generic pleading that did not credibly allege an intent to return, did not allege supposed architectural barriers in sufficient detail, did not explain whether the readily achievable standard applied, and did not provide the detail needed for an enforceable injunction. Many of the default judgment cases we read include an injunction that could never be enforced by contempt, and if federal courts were a little more careful about granting meaningful relief based on the pleadings the kind of result found in Kennedy v. U and V Food would be more common.
The defendants in Johnson v. Powers 2019 WL 454262 (E.D. Cal. Feb. 5, 2019) did not default, but appeared pro se and failed to mount any real defense. The result was a predictable loss although, because the facility was sold during the lawsuit, no injunctive relief was awarded.
About as moot as it gets.
After the filing of this ADA suit the defendant in Johnson v. Otter, 2019 WL 452040 (N.D. Cal. Feb. 5, 2019) closed up shop and terminated his lease. Going out of business was, the Court found, sufficient to make injunctive relief impossible and therefore moot the claim. The Court found that the motive for the closure was irrelevant even though it might have been prompted by the lawsuit. The ADA is a no fault statute, and a guilty mind is neither necessary nor sufficient to establish a violation.
State Immunity under Title II
Block v. Texas Bd. of L. Examiners, 2019 WL 433734 (W.D. Tex. Feb. 1, 2019) is a straightforward application of 11th Amendment immunity to a state agency. It is worth noting, however, that the plaintiff’s claims based on Section 504 of the Rehabilitation Act were dismissed only based on a lack of pleading concerning the agency’s receipt of federal funds. Federal funding is so pervasive in state programs that this decision may be of limited importance. The underlying claim is, by the way, an interesting one. The plaintiff wanted the TBLE to waive the bar examination for Texas because he was licensed in Louisiana. There is an “active practice” exemption for lawyers who practice in another state and have not failed the Texas bar, but the plaintiff did not satisfy this exemption. He blamed both his failures on the Texas bar exam and his lack of time practicing law to his disabilities. Is failure in our stars or in ourselves? Cases concerning mental impairments and intellectual endeavors ask this question over and over again, but there is rarely a clear answer.
Pleading and proving ADA claims
Shaw v. Kelley, 2019 WL 497620 (N.D. Cal. Feb. 7, 2019) affirms the now well established law in the Ninth Circuit that a plaintiff cannot seek relief on unpleaded claims. As in other similar cases the plaintiff obtained an expert report finding many barriers to access not contained in the Complaint. They were rejected as a basis for recovery because they were not pled. After that reasonably straightforward ruling the Court plunges into the minutiae of slopes and dimensions related to parking, accessible paths and restrooms, sometimes finding there are fact issues and sometimes finding there are not. The only broad lesson to be learned is that relying on a report prepared before the lawsuit was filed is not likely to lead to a good result for the defense. A defendant unwilling to settle should commission a report that reflects the current condition of the property and directly addresses all pleaded claims if he or she hopes for summary judgment.
The defendant in Moralez v. Home Depot U.S.A., Inc., 2019 WL 570755 (N.D. Cal. Feb. 12, 2019) did what the defendant in Shaw v. Kelley did not do; that is, produce summary judgment evidence that specifically contradicted every allegation concerning barriers to access. Because ADA violations are based on measurements that anyone can do the court accepted the declaration of a store manager; however, the key to victory was not who did the measurements, but rather that the measurements specifically contradicted individual allegations rather than merely stating in general that no violations existed. Producing this kind of evidence can be tedious, but it is the only way to prevail.
The defendant in Hillesheim v. RVD Real Est. Properties LLC, 2019 WL 631396, (D. Neb. Feb. 14, 2019) fared less well than Home Depot, but appears poised to win on summary judgment. After remediating a clear ADA violation and obtaining evidence that another (slopes) did not exist the defendant moved to dismiss under Rule 12(b)(6). The Court found the factual challenge made it appropriate to treat the motion as one for summary judgment under Rule 56. With that change it gave the plaintiff a last chance to provide summary judgment evidence that the relevant slopes indeed violated the ADA. Since slopes in parking lots do not change overnight it seems unlikely the plaintiff will be able to provide the evidence required unless the defendants’ expert made a mistake. The takeaway is, I think, that defendants who remediate and want to raise a mootness defense should probably skip the Rule 12(b)(6) motion and go directly to summary judgment. After all, factual challenges to the pleaded claims are usually treated as summary judgment motions anyway.
Extraterritorial application of Title III
Galligan v. Adtalem Glob. Educ. Inc., 2019 WL 423356 (N.D. Ill. Feb. 4, 2019) concludes that Title III of the ADA does not apply to facilities (in this case a private veterinary school in the Caribbean) outside the territorial limits of the United States. Another reason for businesses that don’t need a local presence to got to seek the warmth and favorable tax provisions of the islands to the south.
Another mystery in ADA litigation
Stohl v. Magic Mt., LLC, 2019 WL 498993 (E.D. Cal. Feb. 8, 2019) answers an important question: In a multi-district state like California can a corporation incorporated under the laws of that state be sued in a district where it has no real contacts just because it is “present” by definition in every district. In a thorough discussion the court concludes that the answer is no. If everything relevant to the case occurred in a different district then that is where the lawsuit should proceed. It’s a nice textbook on venue issues for those who are interested, but the real mystery is why the lawsuit was filed in the Eastern District of California in the first place. The plaintiff lives in the Central District, the defendant’s business is in the Central District, and all the alleged misconduct took place in the Central District. The plaintiff’s lawyers are from Oakland, in the Northern District of California. One possible answer: the courts in the Central District have extensive experience with ADA litigation and a mandatory ADR program especially set up of ADA cases. This diminishes the settlement value of these cases by preventing the plaintiffs from running up fees early in the case. A quick check of Pacer shows that Ms. Stohl refiled in the Central District within a few days after this case was dismissed. If the case goes anywhere I will let you all know.
* See, “Quick HIts – ADA news of note”
** For a longer discussion of the issues see our blogs “You can’t agree to what you can’t read – the perils of clickwrap when the ADA is involved.” and “Quick Hits – Recent ADA and FHA Cases”
‡ See “Fourth Circuit decision in ADA web access case is a victory for all defendants” and our many other blogs discussing the absurdity of dignitary harm.