Koussa v. Yeung et al

Filing 69

ORDER by Magistrate Judge Jacqueline Scott Corley denying 61 Motion to Dismiss. (ahm, COURT STAFF) (Filed on 7/13/2017)

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UNITED STATES DISTRICT COURT

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NORTHERN DISTRICT OF CALIFORNIA

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PAMELA KOUSSA,

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Plaintiff,

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ORDER DENYING DEFENDANTS’
MOTION TO DISMISS

v.

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MING YEUNG, et al.,

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Re: Dkt. No. 61

Defendants.

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United States District Court
Northern District of California

Case No.16-cv-05137-JSC

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Plaintiff Pamela Koussa brings this action against Defendants Ming Yeung, Jia Yeung, and

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Leonicio Perez Santiago for disability discrimination in connection with access barriers she

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encountered at Pup Hut, a restaurant in Richmond, California. (Dkt. No. 1.1) Now before the

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court is Defendants’12(b)(6) motion to dismiss for failure to state a claim upon which relief may

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be granted. After reviewing the parties’ briefs, and having had the benefit of oral argument on

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July 13, 2017, the Court DENIES Defendants’ motion to dismiss.

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BACKGROUND

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Plaintiff, who is physically disabled from the waist down and uses a wheelchair for

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mobility, attempted to dine at Pup Hut restaurant, a facility open to the public. (Dkt. No. 1 at 2:2-

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3, 3:12-14.) Although there were parking spaces reserved for patrons of the restaurant, there were

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no accessible handicap parking spaces for persons with disabilities. (Id. at 3:17-20.) Plaintiff

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alleges that compliant parking spaces were previously available, but there are no compliant spaces

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currently available. (Id. at 3:24-26, 4:1-3.) Plaintiff brings two civil rights claims: violation of the

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American with Disabilities Act (“ADA”) and violation of the Unruh Civil Rights Act. (Id. at 5-6.)

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Record citations are to material in the Electronic Case File (“ECF”); pinpoint citations are to the
ECF-generated page numbers at the top of the documents.

Plaintiff’s counsel, Mark Potter, informed Defendants’ counsel, Andrew Shalaby, that

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Plaintiff would be willing to settle the case if Defendants brought the restaurant into compliance

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and paid $14,000, or alternatively $4,000 plus a promise to pay reasonable attorney’s fees in an

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amount determined by this Court. (Dkt. No. 62-2 at 7.) Mr. Shalaby responded by sending Mr.

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Potter an order regarding attorney’s fees for another ADA case brought by Mr. Potter’s firm,

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stated Defendants will pay $8,000, requested instructions on whom to make the check out to, and

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informed Mr. Potter that if he failed to respond that same day Mr. Shalaby would issue the check

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to both Mr. Potter’s law firm and Plaintiff. (Id. at 5-6.)
Mr. Potter responded that Mr. Shalaby cannot unilaterally determine the fair amount of

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attorney’s fees, requested that Mr. Shalaby not unilaterally send a check, and informed Mr.

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United States District Court
Northern District of California

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Shalaby that the check would have no legal consequence. (Id. at 5.) Mr. Potter further offered to

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settle the case if Defendants took remedial measures to bring the parking lot into compliance, and

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pay $4000 in damages plus reasonable attorney’s fees decided by this Court. (Id. at 4.)
Mr. Shalaby stated that “I wish I could discuss this case with you, but my client will be

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billed for it.” (Id.) He informed Mr. Potter that Defendants would pay the $8,000 and then move

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for summary judgment and sanctions. (Id.) The parties had a phone call on May 31, 2017, and

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Mr. Potter sent an email the next day, June 1, 2017, confirming that Plaintiff would not accept a

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check from Defendants without a settlement. (Id. at 2.) Mr. Potter also wrote to confirm what Mr.

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Shalaby stated on the phone – that the purpose in sending the check was to moot Plaintiff’s claims,

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not to settle the case. (Id.)
Mr. Shalaby then made a subsequent offer of $9,070, and stated that he was willing to call

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it a “settlement.” (Id.) Plaintiff counter demanded remedial relief by bringing the property into

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compliance with the ADA, $4000 in damages, and $10,000 in attorney’s fees. (Id.) On June 2,

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2017, Defendants rejected the counter demand and mailed a check in the amount of $8,000. (Id.;

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Dkt. No. 61-2 at 1.) Mr. Potter responded that Plaintiff would not accept the check, and mailed it

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back to Defendant. (Dkt. No. 61-3 at 1.)

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DISCUSSION

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I.

Rule 12(b)(6) Motion to Dismiss For Failure to State a Claim
Defendants improperly bring their motion pursuant to Rule 12(b)(6). A Rule

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12(b)(6) motion challenges the sufficiency of a complaint as failing to allege “enough facts to state

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a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570

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(2007). For the purposes of ruling on a Rule 12(b)(6) motion, the court “accept [s] factual

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allegations in the complaint as true and construe[s] the pleadings in the light most favorable to the

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non-moving party.” Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir.

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2008). “[D]ismissal may be based on either a lack of a cognizable legal theory or the absence of
sufficient facts alleged under a cognizable legal theory.” Johnson v. Riverside Healthcare

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United States District Court
Northern District of California

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Sys., 534 F.3d 1116, 1121 (9th Cir. 2008) (internal quotation marks and citations omitted); see

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also Neitzke v. Williams, 490 U.S. 319, 326 (1989) (“Rule 12(b)(6) authorizes a court to dismiss a

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claim on the basis of a dispositive issue of law.”). Further, a court may not consider matters

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outside of the complaint in ruling on a 12(b)(6) motion. Cervantes v. City of San Diego, 5 F.3d

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1273, 1274 (9th Cir. 1993).
Defendants have not identified any deficiencies in the complaint allegations. Instead, their

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entire motion depends on documents and communications that are not pled or even referenced in

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the complaint and therefore cannot be considered. For this reason alone the Court denies

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Defendants’ motion.

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II.

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Standing
Defendants argue that because they tendered $4000 in statutory damages under the Unruh

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Act and that tender was rejected, Plaintiff’s claims are now moot and Plaintiff has waived her right

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to recover fees and expenses. Defendants’ motion challenges Plaintiff’s standing – it is essentially

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a 12(b)(1) motion disguised as a 12(b)(6) motion, and, for the sake of completeness, the Court will

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treat it as such.

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A.

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“A case is moot when the issues presented are no longer ‘live’ or the parties lack a legally

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Mootness

cognizable interest in the outcome.” City of Erie v. Pap's A.M., 529 U.S. 277, 287 (2000).
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“Mootness can be characterized as the doctrine of standing set in a time frame: The requisite

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personal interest that must exist at the commencement of the litigation (standing) must continue

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throughout its existence (mootness).” Foster v. Carson, 347 F.3d 742, 745 (9th Cir.

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2003) (internal quotation marks and citations omitted). Thus, the central inquiry to any mootness

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challenge is “whether changes in the circumstances existing when the action was filed have

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forestalled any meaningful relief.” Moeller v. Taco Bell Corp., 816 F.Supp.2d 831, 860

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(2011). An action “becomes moot only when it is impossible for a court to grant any effectual

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relief [whatsoever] to the prevailing party.” Knox v. Service Employees Inter. Union, Local 100,

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567 U.S. 298, 307 (2012). “The party asserting mootness” bears the heavy burden of “establishing

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that there remains no effective relief a court can provide.” Forest Guardians v. Johanns, 450 F.3d

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United States District Court
Northern District of California

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455, 461 (9th Cir. 2006).

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An unaccepted Rule 68 offer, or an offer of judgment, that would fully satisfy a plaintiff’s

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individual claim is insufficient to render the claim moot. Diaz v. First American Home Buyers

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Protection Corp., 732 F.3d 948, 950 (9th Cir. 2013). In regards to settlement, a case will “become

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moot” when “an opposing party has agreed to everything the other party has demanded.” GCB

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Communications v. U.S. South Communications, Inc., 650 F.3d 1257, 1267 (9th Cir. 2001) (citing

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cases). An unaccepted settlement offer or offer of judgment of complete relief, however, does not

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moot a plaintiff's case. Campbell-Ewald Company v. Gomez, 136 S.Ct. 663, 665 (2016).

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Defendants’ $8,000 offer to cover the Unruh Act statutory damages was not accepted by

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Plaintiff. Plaintiff promptly informed Defendants that $8,000 would not settle the case and

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returned the check. Because Plaintiff did not accept the offer, it did not moot Plaintiff’s claim.

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See Diaz, 732 F.3d 948 at 950; Campbell-Ewald Company, 136 S.Ct. at 665. This is a second

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reason Defendants’ motion must be denied.

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B.

California Code of Civil Procedure Section 2076

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Defendants also cite California Code of Civil Procedure Section 2076 to support their

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mootness argument. That statute states in relevant part that the person to whom a tender is made

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must specify any objection she has at the time the tender is made or she is deemed to have waived

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it. If a person objects to the amount of money she must specify what she requires or else be
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precluded from objecting afterwards. Id. The public policy behind Code of Civil Procedure

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Section 2076 is to protect debtors who tender performance in good faith from harm by creditors

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who refuse to accept tender. See Gaffney v. Downey Savings and Loan Association, 200

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Cal.App.3d 1154, 1166 (1988).

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Plaintiff is not a creditor. Defendant is not a debtor. The parties do not have a contractual

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relationship. Defendants fail to identify a single case where Section 2076 applied to a civil rights

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lawsuit concerning disability discrimination and this Court can find none. Thus, Section 2076

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does not apply. Even if it were to apply, Plaintiff immediately rejected the tender and Defendants

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were aware of the reason for the rejection; therefore Plaintiff could not have waived any

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objections to the amount.
CONCLUSION

United States District Court
Northern District of California

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For the reasons stated above, the Court DENIES Defendants’ motion to dismiss. This
Order disposes of Docket No. 61.

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IT IS SO ORDERED.
Dated: July 13, 2017

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JACQUELINE SCOTT CORLEY
United States Magistrate Judge

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