Hawaii Regional Council of Carpenters et al v. Yoshimura

Filing 26

ORDER DENYING DEFENDANT'S MOTION TO DISMISS THE COMPLAINT OR IN THE ALTERNATIVE FOR JUDGMENT ON THE PLEADINGS re 12 , 25 - Signed by JUDGE ALAN C KAY on 9/12/2016. (emt, )CERTIFICATE OF SERVICEPar ticipants registered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Participants not registered to receive electronic notifications were served by first class mail on the date of this docket entry

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII

HAWAII REGIONAL COUNCIL OF
CARPENTERS, ET AL.,
Plaintiff,
vs.
LANCE YOSHIMURA,
Defendant.

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ORDER DENYING DEFENDANT’S MOTION TO DISMISS THE COMPLAINT
OR IN THE ALTERNATIVE FOR JUDGMENT ON THE PLEADINGS
For the reasons set forth below, the Court DENIES
Defendant Lance Yoshimura’s Motion to Dismiss the Complaint or
in the Alternative for Judgment on the Pleadings (“Motion”), ECF
No. 12.
BACKGROUND
On July 21, 2015, prior to the filing of the instant
suit, Defendant Lance Yoshimura (“Yoshimura”) filed a complaint
against Hawaii Regional Council of Carpenters and United
Brotherhood of Carpenters and Joiners of America, Local 745
(“the Union”) and Ronald Taketa (“Taketa”) in the Circuit Court
of the First Circuit, State of Hawaii (the “State Court Action”)
asserting claims related to his termination from the Union.
Shanley Decl. Ex 1 (State Court Complaint).

The State Court

Action included four claims: Violation of the Hawaii

Whistleblowers’ Protection Act; Unlawful Termination as Against
Public Policy; Negligent Infliction of Emotional Distress; and
Tortious Interference with a Business Relationship.

Id. ¶¶ 21-

39.
The claims stemmed from circumstances surrounding
Yoshimura’s employment and eventual termination from the Union.
Yoshimura alleged that from 2000 until March 7, 2014, he was an
employee of the Union.

Id. ¶¶ 6, 19.

According to Yoshimura,

Taketa is the Union’s Regional Council Head, Executive
Secretary, and Treasurer, and Taketa appointed Yoshimura to the
position of Assistant Business Representative and Interim
Marketing Development Director.

Id. ¶¶ 3, 6.

Yoshimura

contended that in 2011, the United States Department of Labor
(“Department of Labor” or “DOL”) informed the Union of an
upcoming audit of a Union trust fund.

Id. ¶ 7.

Yoshimura

alleged that in preparation for the audit, the Union sought to
falsify time records to cover up its failure to keep accurate
and complete records and that Taketa instructed Yoshimura to
inform Union business representatives to create false time
records.

Id. ¶ 9.

Yoshimura claimed that he repeatedly

objected to the Union’s scheme and eventually filed complaints
with both the Department of Labor and the Federal Bureau of
Investigation.

Id.

¶¶ 9, 12, 15, 18.

2

In retaliation,

according to Yoshimura, the Union terminated his employment.
Id. ¶ 19.
The Union removed the action to this district court
arguing that the claims were preempted by the Employee
Retirement Income Security Act of 1974 (“ERISA”).

Yoshimura v.

Hawaii Carpenters Union Local 475 et al., Civ. No. 15-00292 HGRLP (“2015 USDC Action”), ECF No. 1.

The Union also filed in

this district court a counterclaim for violation of Section
501(a) of the Labor Management Reporting and Disclosure Act of
1959 (“LMRDA”) alleging that Yoshimura breached his fiduciary
duty to the Union by causing dissension, trying to divide the
staff for his own interests, and falsely accusing the Union of
stealing assets for his own personal gain (“Counterclaim”).
Shanley Decl. Ex. 2, ¶ 22.

The Counterclaim alleged that

Yoshimura used the DOL investigation to attempt to oust Taketa
from his position as Executive Secretary-Treasurer (“EST”) so
that Yoshimura could take over.

Id. ¶¶ 4-5, 14.

According to

the Union, Yoshimura used the fact that the Union failed to keep
contemporaneous time records to demonstrate that Taketa needed
to be replaced.

Id. ¶ 14.

This district court determined that ERISA did not
preempt Yoshimura’s claims and, accordingly, that the court
lacked subject matter jurisdiction.

Motion, Ex. 1 (Order

Denying Defendants’ Motion to Dismiss Plaintiff’s Complaint and
3

Remanding Proceedings to the Circuit Court of the First Circuit,
State of Hawaii), at 20, ECF No. 12-2.

The court held that the

Union’s Counterclaim could not serve as a basis for the court’s
federal question jurisdiction.

Id. at 19.

Accordingly, on

October 15, 2015, the court remanded the case.

Id. at 20-21.

On April 26, 2016, the Union filed the instant case
against Yoshimura.

Compl., ECF No. 1.

The Complaint includes

two causes of action: 1) Breach of Fiduciary Duties under the
LMRDA (29 U.S.C. § 501(a)) related to Yoshimura’s alleged theft
of union and membership records, secret audio recordings of
confidential conversations, and breach of confidential
agreements, id. ¶¶ 27, 28, 34-35; and 2) Violation of the
Federal Wiretap Statute, (18 U.S.C. § 2510, et seq.), in
relation to allegations of secret audio recordings of
confidential conversations, id. ¶¶ 40-43.

The Union alleges

that Yoshimura’s theft of records, secret audio recordings, and
other “illicit conduct was done” to cover his breach of
fiduciary duties and to “extort[]” from EST Taketa “the support
and commitment necessary for Yoshimura to be appointed the next
EST.”

Id. ¶ 3.

According to the Union, Yoshimura stole the

records and secretly recorded the communications “in attempt to
force the current EST to make him the next EST.”

Id. ¶ 4.

On June 9, 2016, Yoshimura filed his Motion to Dismiss
the Complaint or in the Alternative for Judgment on the
4

Pleadings arguing that 1) the Union’s claims in the instant suit
are compulsory counterclaims to the pending State Court Action
that should be dismissed; and 2) in the alternative, if the
wiretap claim is properly pled, Yoshimura is entitled to
judgment on the pleadings with respect to that claim.
The Union filed its Memorandum in Opposition on August
22, 2016.
2016.

ECF No. 23.

Yoshimura filed his Reply on August 29,

ECF NO. 24.
A hearing on the motion was held on September 12,

2016.
STANDARD
I.

Motion to Dismiss
Federal Rule of Civil Procedure (“Rule”) 12(b)(6)

authorizes the Court to dismiss a complaint that fails “to state
a claim upon which relief can be granted.”

Pursuant to Ashcroft

v. Iqbal, “[t]o survive a motion to dismiss, a complaint must
contain sufficient factual matter, accepted as true, to ‘state a
claim to relief that is plausible on its face.’”

556 U.S. 662,

678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S.
554, 570 (2007)).

In resolving a Rule 12(b)(6) motion, the

court must construe the complaint in the light most favorable to
the plaintiff and accept all well-pleaded factual allegations as
true.

Sateriale v. R.J. Reynolds Tobacco Co., 697 F.3d 777, 783

(9th Cir. 2012).
5

Under Rule 12(b)(6), review is generally limited to
the contents of the complaint.

Sprewell v. Golden State

Warriors, 266 F.3d 979, 988 (9th Cir. 2001); Campanelli v.
Bockrath, 100 F.3d 1476, 1479 (9th Cir. 1996).

However, courts

may “consider certain materials—documents attached to the
complaint, documents incorporated by reference in the complaint,
or matters of judicial notice—without converting the motion to
dismiss into a motion for summary judgment.”
Ritchie, 342 F.3d 903, 908 (9th Cir. 2003).

United States v.
Accordingly, the

Court takes judicial notice of the fact of the filing or
issuance of the publicly recorded documents attached to
Yoshimura’s Motion and to the Union’s Opposition.
II.

Motion for Judgment on the Pleadings
Federal Rule of Civil Procedure 12(c) permits a party

to move for judgment on the pleadings after the pleadings are
closed, but early enough not to delay trial.
12(c).

Fed. R. Civ. P.

“Under Federal Rule of Civil Procedure 12(c), judgment

on the pleadings is proper ‘when, taking all the allegations in
the non-moving party’s pleadings as true, the moving party is
entitled to judgment as a matter of law.’”

Ventress v. Japan

Airlines, 486 F.3d 1111, 1114 (9th Cir. 2007); see also
Alexander v. City and Cnty. of Honolulu, 545 F. Supp. 2d 1122,
1130 (D. Haw. 2008).

The standard governing a Rule 12(c) motion

for judgment on the pleadings is “functionally identical” to
6

that governing a Rule 12(b)(6) motion.

United States ex rel.

Cafasso v. Gen. Dynamics C4 Sys., Inc., 637 F.3d 1047, 1054 n.4
(9th Cir. 2011).
DISCUSSION
I.

Applicable Law
Yoshimura maintains that the instant Complaint

consists of compulsory counterclaims that should have been
raised in the State Court Action, pursuant to Federal Rule of
Civil Procedure 13(a), and accordingly, that the claims should
be dismissed.

Mot. at 5-10.

In response, the Union argues that

the federal rule cannot apply “extraterritorially to require
that the Union amend its pending counterclaim in the [State]
Court Action.”

Mem. in Opp. at 9, ECF No. 23.

In his Reply,

Yoshimura denies that he is requesting the Court to apply the
rule extraterritorially, and points to the fact that the Union
filed its Counterclaim in federal court pursuant to the LMRDA in
the 2015 USDC Action, to support his claim that the federal rule
should apply.

Reply, at 5-6.

The parties, however, have failed to acknowledge that
“Hawaii state law governs the preclusive effect of the failure
to raise a compulsory counterclaim in an earlier state court
action.”

JPMorgan Chase Bank, N.A. v. Moniz, Civ. No. 15-00512

DKW-BMK, 2016 WL 1242526, at *3 (D. Haw. Mar. 29, 2016) (quoting
Peelua v. Impac Funding Corp., Civ. No. 10-00090 JMS-KSC, 2011
7

WL 1042559, at *10 (D. Haw. Mar. 18, 2011)); see also Pochiro v.
Prudential Ins. Co. of Am., 827 F.2d 1246, 1249 (9th Cir. 1987)
(“The question whether the [plaintiffs’] claims are compulsory
counterclaims which should have been pleaded in the earlier
Prudential state court action is a question of state law.”).
Thus, in JPMorgan and Peelua, this district court considered
Hawaii law to determine whether the respective federal
complaints at issue should be dismissed on the basis that they
contained compulsory counterclaims to the earlier-filed state
cases.

See JPMorgan, 2016 WL 1242526, at *1, *3; Peelua, 2011

WL 1042559, at *10-11.

Here, because the State Court Action was

originally filed in state court and is currently pending in
state court, the Court finds that state law governs the
determination of whether the Union’s claims in the instant case
are barred as compulsory counterclaims to the State Court
Action. 1
II.

Whether the Union’s Claims are Compulsory Counterclaims to
the State Court Action
Hawaii Rules of Civil Procedure (“HRCP”) 13(a) defines

a compulsory counterclaim, and is substantively identical to

1

As discussed further below, a compulsory counterclaim
must be asserted at the time the party’s answer is filed. Here,
the Union’s answer was filed in the State Court Action,
providing further support that state law should govern the
compulsory counterclaim question in the instant case.
8

Federal Rule of Civil Procedure 13(a).

HRCP 13(a) provides in

relevant part:
A pleading shall state as a counterclaim any
claim which at the time of serving the pleading
the pleader has against any opposing party, if it
arises out of the transaction or occurrence that
is the subject matter of the opposing party’s
claim and does not require for its adjudication
the presence of third parties of whom the court
cannot acquire jurisdiction.
As an initial matter, the Court notes that the Union
and Yoshimura are each parties to both the state and federal
court cases and there is no issue with respect to third parties.
Thus, this portion of HRCP 13(a) is satisfied here.
Turning to the substance of the claims, as is true in
the Ninth Circuit, under Hawaii law, “a counterclaim is
compulsory if there is a logical relation between the original
claim and the counterclaim—i.e., it arises out of the same
aggregate of operative facts as the original claim.”

E. Sav.

Bank, FSB v. Esteban, 296 P.3d 1062, 1070 n.13 (Haw. 2013); see
also Booth v. Lewis, 798 P.2d 447, 449 (Haw. Ct. App. 1990)
(“[T]he most widely accepted standard is the logical
relationship test . . . .”).

“If a defendant fails to assert a

compulsory counterclaim, he is precluded from asserting it
against the plaintiff in a subsequent action.”
296 P.3d at 1070 n.13.

9

E. Sav. Bank,

As recognized by the Hawaii Supreme Court, the
rationale behind the rule is “to prevent multiplicity of actions
and to achieve resolution in a single lawsuit of all disputes
arising out of common matters.”
368 (Haw. 1976).

Bailey v. State, 552 P.2d 365,

Thus, the “logical relationship” test is

construed liberally.

See Pochiro, 827 F.2d at 1249 (“This

flexible approach to Rule 13 problems attempts to analyze
whether the essential facts of the various claims are so
logically connected that considerations of judicial economy and
fairness dictate that all the issues be resolved in one
lawsuit.” (citation omitted)).

Importantly, “‘transaction’ is a

word of flexible meaning which may comprehend a series of
occurrences if they have a logical connection.”

Id. at 1252

(citation omitted); see also Kalakaua Relief Line, LLC v. 1830
Kapiolani, LLC, No. CAAP-12-0001012, 2016 WL 2984271, at *5
(Haw. Ct. App. May 23, 2016) (citing to a Ninth Circuit case for
the proposition that a “‘transaction’ . . . is not confined to a
single, isolated act or occurrence . . . but may embrace a
series of acts or occurrences logically interrelated”
(alterations in original) (quoting Cheiker v. Prudential Ins.
Co. of Am., 820 F.2d 334, 337 (9th Cir. 1987)).
Pursuant to this standard, the Court concludes that
the Union’s LMRDA claim and wiretap claim before this Court are
logically related to the claims raised by Yoshimura in the State
10

Court Action.

In the State Court Action, Yoshimura raised

claims for negligent infliction of emotional distress, unlawful
termination, tortious interference with a business relationship,
and a claim under Hawaii’s Whistleblower Protection Act.

All of

these claims relate to Yoshimura’s period of employment at the
Union and his apparently contentious business relationship with
his employer, which eventually led to his termination.

The

claims currently pending in this Court also deal with
Yoshimura’s contentious employment at the Union, through the
allegations that, during his employment, Yoshimura stole Union
records and recorded communications in breach of his fiduciary
duties and as prohibited by the Federal Wiretap Statute.
Under these circumstances, the Court finds that the
state claims and the claims raised here “arise[] out of the same
aggregate of operative facts.”

E. Sav. Bank, 296 P.3d at 1096

n.13; cf. Pochiro, 827 F.2d at 1250 (finding operative facts
underlying former employee’s action for, inter alia, intentional
interference with contractual advantage, tortious breach of
employment contract, and intentional infliction of emotional
distress were “inextricably intertwined” with former employer’s
action to enjoin former employee’s use of confidential customer
records); Booth, 798 P.2d at 449 (finding claim was compulsory
counterclaim where claims were “offshoots of the rather lengthy
business relationship” between the parties).
11

The Union argues that Yoshimura’s state claims are
unrelated to the Union’s claims at issue in this Court because
the Union was unaware that Yoshimura stole union records and
recorded confidential communications at the time Yoshimura was
terminated and because Yoshimura did not claim that the Union
fired him as a result of the stolen records and recordings.
Mem. in Opp., at 13.

This contention, however, fails to take

into account the flexible nature of the logical relationship
test.

As noted above, the standard should be interpreted

broadly, and in determining whether claims arise out of the same
“transaction” or “occurrence” the transaction may include a
“series of many occurrences, depending not so much upon the
immediateness of their connection as upon their logical
relationship.”

Warshawsky & Co. v. Arcata Nat. Corp., 552 F.2d

1257, 1261 (7th Cir. 1977) (citing Moore v. New York Cotton
Exchange, 270 U.S. 593, 610 (1926)).

On this basis, it is of

little relevance that the Union did not have knowledge of
Yoshimura’s actions and that the theft and audio recordings are
not explicitly raised in Yoshimura’s state court claims.

What

matters instead is that the claims are logically related because
they arose out of the same set of operative facts, i.e., the
business relationship between Yoshimura and the Union during
Yoshimura’s employment and subsequent termination.

12

The Court’s conclusion that the claims are logically
related finds further support by comparing the Union’s
Counterclaim currently pending in the State Court Action with
the claims raised in the instant case.

The Counterclaim

includes one cause of action for breach of fiduciary duty under
the LMRDA.

In the Counterclaim, the Union alleged that

Yoshimura breached his fiduciary duties by “engag[ing] in a
pattern of conduct designed to weaken” the Union “for the sole
purpose of furthering his campaign plan to oust his boss, [EST]
Taketa.”

Counterclaim ¶ 3.

The Counterclaim alleged that

Yoshimura used the DOL investigation—at issue in Yoshimura’s
wrongful termination claims—in an attempt to become the new EST
of the Union.

Id. ¶¶ 14, 16.

Notably, the Union admitted in

the Counterclaim that Yoshimura’s state claims and the LMRDA
claim were “so related . . . that they form part of the same
case or controversy.”

Id. ¶ 11.

The Union noted,

They arise out of a common nucleus of operative
facts in that Yoshimura’s conduct alleged here
arose out of the [DOL] investigation he alleges
and his subsequent conduct to that investigation
up to and including his termination. Thus, the
facts alleged here substantially overlap [with]
the facts alleged by Yoshimura.
Id.
The LMRDA breach of fiduciary claim and the wiretap
claim pending before this Court similarly involve allegations
that Yoshimura acted improperly in an attempt to take over the
13

position of EST from Taketa.

Compl. ¶¶ 3-4.

Admittedly, the

instant Complaint does not specifically discuss the DOL
investigation or facts surrounding Yoshimura’s termination.
Nonetheless, because the Counterclaim and Yoshimura’s claims are
related (as admitted by the Union) and the Counterclaim and the
claims in the instant case are related, it logically follows
that the claims before this Court are logically related to
Yoshimura’s state court claims. 2
However, the inquiry does not end here.

Pursuant to

HRCP 13(a), and similar to its federal counterpart, “[a]
pleading shall state as a counterclaim any claim which at the
time of serving the pleading the pleader has against any
opposing party.” (Emphasis added).

Thus, even if the claims are

logically related, “a party is not required to assert a
counterclaim” if the counterclaim “had not matured at the time
[the party] serves his pleading.”

Fogarty v. State, 705 P.2d

72, 75 (Haw. Ct. App. 1985); Kuschner v. Nationwide Credit,
Inc., 256 F.R.D. 684, 689 (E.D. Cal. 2009) (noting that a
counterclaim “is not considered compulsory although it may arise

2

The Court additionally notes that, according to the
Union, it only found out about Yoshimura’s theft of records and
recorded conversations through discovery conducted in the State
Court Action. Mem. in Opp., at 5. That this information was
discoverable in the State Court Action further indicates that
Yoshimura’s state court claims are logically related to the
claims at issue here.
14

from the same transaction or occurrence as the opposing party’s
claim” where “the counterclaim has matured after the pleading
was filed”).

The Hawaii Intermediate Court of Appeals has noted

that “[a] claim is matured for the purposes of the rule if the
person asserting the counterclaim knew or by the exercise of
reasonable diligence should have known that his claim existed at
the time he served his pleading.”

Fogarty, 705 P.2d at 75.

The parties appear to disagree regarding the
appropriate time period that should be considered to determine
whether the Union’s claims had matured.

The Union argues that

it had insufficient knowledge regarding the claims raised before
this Court at the time Yoshimura served his state court
complaint.

Mem. in Opp., at 17.

Yoshimura maintains that the

Court should consider whether the Union’s claims had matured at
the time the Union filed the LMRDA Counterclaim in the 2015 USDC
Action.

Reply, at 7.

Neither party is correct.

Instead, the

Court must consider whether the Union’s claims had matured at
the time the Union filed its answer in the State Court Action.
See Fogarty, 705 P.2d at 620 (noting that “the relevant time
under [HRCP] 13(a) is the point when [the] Fogartys filed their
answer”); see also 6 Charles Alan Wright & Arthur R. Miller,
Federal Practice and Procedure § 1411 (3d ed. 1998) (“A
counterclaim acquired by defendant after answering the complaint

15

will not be considered compulsory, even if it arises out of the
same transaction as does plaintiff’s claim.”).
The parties have not provided the Court with the date
the answer was filed in the State Court Action.

However, the

Court through its own investigation of the public record in the
State Court Action has determined that the Union filed its
answer on October 23, 2015.
notice of this date.

The Court sua sponte takes judicial

See Fed R. Evid. 201 (providing that the

court may on its own take judicial notice of facts that “can be
accurately and readily determined from sources whose accuracy
cannot reasonably be questioned”).

Accordingly, the Court must

determine whether the Union “knew or by the exercise of
reasonable diligence should have known that” its claims asserted
here existed in October 2015.

Fogarty, 705 P.2d at 75. 3

The Union argues that it was unaware of Yoshimura’s
theft of the Union records or the secret audio recordings until
2016 when it obtained copies of the documents and some of the
recordings through discovery in the State Court Action.
Opp., at 13-17; see also Compl. ¶ 28.

Mem. in

The Union admits that it

was aware of “unsubstantiated rumor[s]” that Yoshimura had
secret recordings but that when confronted with this issue,
3

The Court notes that even if the Court considered the
time periods proposed by the parties, the Court’s resolution of
this issue would not change given the Union’s allegations that
it did not discover the theft or audio recordings until 2016.
16

Yoshimura “adamantly denied recording anyone.”
13-14; see also Compl. ¶¶ 5, 26, 28.

Mem. in Opp., at

In turn, Yoshimura argues

that the Union “was aware of Mr. Yoshimura’s document retention”
since at least March 2013 “when [Taketa] . . . threatened Mr.
Yoshimura that it would be in his best interest to get rid of
his documentation.”

Reply, at 7.

Yoshimura maintains that

“[t]his is all documented in the discovery . . . provided to the
Union” in the State Court Action.

Reply, at 7.

With respect to

the wiretapping claim, Yoshimura argues that 1) it is unlikely
that the Union would have confronted Yoshimura based on
unsubstantiated rumors alone and that it is “much more likely”
that the Union had “sufficient information” regarding the secret
recordings; 2) the Union took Yoshimura’s denials at face value
and failed to further investigate the issue of the secret
recordings; and 3) the Union “knew or reasonably should have
known” based on the rumors that Yoshimura had secretly recorded
communications and that they had sufficient information for an
“‘information and belief’ standard of pleading.”

Mot., at 9-10.

The Court concludes that based on the information
provided by the parties, the Court is unable to determine that
the Union knew or should have known about the stolen materials
and the secret audio recordings at the time its answer was filed
in the State Court Action.

The Complaint alleges that the Union

did not “discover” Yoshimura’s theft and illegal recordings
17

until 2016 and that when Yoshimura denied wrongdoing, the Union
“had no evidence or any reasonable basis to rebut Yoshimura’s
denial thereby forcing it to accept Yoshimura’s denial at face
value.”

Compl. ¶ 28.

On a Motion to Dismiss, the Court must

accept these allegations as true.

See Sateriale, 697 F.3d at

783.
Moreover, Yoshimura has failed to provide support for
his claim that the Union knew about the theft of the documents
in March 2013, and even if such evidence had been provided, it
is unlikely that the Court could consider it in a motion to
dismiss.

In terms of the claims regarding the secret audio

recordings, the Court agrees with the Union that Yoshimura’s
claims that the Union had information beyond “unsubstantiated
rumors” are speculative.

The Court also agrees with the Union

that based on an “unsubstantiated rumor” alone, the Union could
not meet the pleading standard requiring that “the allegations
and other factual contentions have evidentiary support or, if
specifically so identified, are likely to have evidentiary
support after a reasonable opportunity for further investigation
or discovery.”

HRCP Rule 11(b)(3); see also Fed. R. Civ. P.

11(b)(3) (same).
In sum, although the Court finds that the claims
before it are logically related to Yoshimura’s claims in the
State Court Action, the Court is unable to determine that the
18

Union’s claims had matured at the time its answer was filed in
the State Court Action.

The Court thus concludes that the

Union’s claims in the instant Complaint are not compulsory
counterclaims to the State Court Action.
denies Yoshimura’s Motion to Dismiss.

Accordingly, the Court

Cf. Fogarty, 705 P.2d at

76 (holding plaintiffs’ action not barred where claims were not
compulsory counterclaims to earlier action given that plaintiffs
“did not have an opportunity to present their counterclaim at
the time they served their answer” in the earlier action);
Kuschner, 256 F.R.D. at 690 (holding the defendant’s
counterclaim related to nonconsensual recordings of confidential
telephone conversations had not matured at time its answer was
filed because the defendant only learned of the recordings
during a deposition in preparation for trial). 4

4

The Court will not address the issue raised regarding
abstention pursuant to Colorado River Water Conservation
District v. United States, 424 U.S. 800, 880 (1976), since the
parties have not sufficiently briefed this issue. The Court
notes that the Ninth Circuit has seldom approved abstention
pursuant to Colorado River. See, e.g., Holder v. Holder, 305
F.3d 854, 867 (9th Cir. 2002) (noting a stay of proceedings
pursuant to the Colorado River doctrine is only appropriate
where “exceptional circumstances” are present (citation
omitted)).

19

III. Viability of the Union’s Wiretap Claim
Yoshimura argues that he is entitled to judgment on
the pleadings for the Union’s claim pursuant to the Federal
Wiretap Statute.

Mot., at 11-12.

As an initial matter, the Court notes that a motion
for judgment on the pleadings is inappropriate at this stage of
the proceedings because the pleadings have not been closed.

See

Fed. R. Civ. P. 12(c) (noting a party may move for judgment on
the pleadings “[a]fter the pleadings are closed.”).
Specifically, Yoshimura has not yet filed an answer, rendering
his Motion for Judgment on the Pleadings premature.

See Doe v.

United States, 419 F.3d 1058, 1061 (9th Cir. 2005) (noting that
a motion for judgment on the pleadings filed before the answer
“was premature and should have been denied”); City Bank v. Glenn
Const. Corp., 68 F.R.D. 511, 512 (D. Haw. 1975) (“Judgment on
the pleadings under Rule 12, of course, is available only when
the pleadings are closed and there has been no answer yet in
this case.”).

Accordingly, the Court denies Yoshimura’s Motion

for Judgment on the Pleadings.

The Court, however, deems it

appropriate to consider Yoshimura’s claim as a motion to dismiss
pursuant to Federal Rule of Civil Procedure 12(b)(6).

See Weeks

v. Wyeth, Inc., 120 F. Supp. 3d 1278, 1283 (M.D. Ala. 2015)
(construing motion for judgment on the pleadings filed prior to
the answer as a motion to dismiss pursuant to Rule 12(b)(6));
20

Signature Combs, Inc. v. United States, 253 F. Supp. 2d 1028,
1030 (W.D. Tenn. 2003) (same).
The Complaint alleges that “Yoshimura violated the
Federal Wiretap Statute by intentionally and surreptitiously
recording numerous [Union] protected communications for
improper, tortious and criminal purposes.”

Compl. ¶ 40.

18

U.S.C. § 2511 et seq. makes it unlawful to intentionally
intercept or endeavor to intercept, use, or disclose wire, oral,
or electric communications of individuals or entities.

18

U.S.C. § 2511(2)(d) provides,
It shall not be unlawful under this chapter for a
person not acting under color of law to intercept
a wire, oral, or electronic communication where
such person is a party to the communication or
where one of the parties to the communication has
given prior consent to such interception unless
such communication is intercepted for the purpose
of committing any criminal or tortious act in
violation of the Constitution or laws of the
United States or of any State.
In his Motion, Yoshimura argued that because he was a
party to the communications at issue, his actions were lawful.
Mot., at 11.

The Union, in turn argues that its claim is based

on the exception in the statute, for communications “intercepted
for the purpose of committing any criminal or tortious act in
violation of the Constitution or laws of the United States or of
any State.”

Mem. in Opp., at 18 (emphasis omitted).

In his

Reply, Yoshimura asserts that the Union “never elaborates or

21

suggests what those ‘improper, tortious and criminal purposes’
might be.”

Reply, at 10.
The Union is correct that even though Yoshimura was a

party to the communications, their “interception” may violate
the statute if the purpose behind the recordings was criminal or
tortious.

The Ninth Circuit has explained,
Under section 2511, “the focus is not upon
whether the interception itself violated another
law; it is upon whether the purpose for the
interception—its intended use—was criminal or
tortious.” Payne v. Norwest Corp., 911 F. Supp.
1299, 1304 (D. Mont. 1995), aff’d in part and
rev’d in part, 113 F.3d 1079 (9th Cir. 1997).
See also Deteresa v. American Broad. Cos., 121
F.3d 460, 467 n.4 (9th Cir. 1997) (emphasizing
the distinction between a taping that is itself
tortious or criminal, and one carried out for the
purpose of committing some other crime or tort).
Where the taping is legal, but is done for the
purpose of facilitating some further impropriety,
such as blackmail, section 2511 applies. Where
the purpose is not illegal or tortious, but the
means are, the victims must seek redress
elsewhere.

Sussman v. Am. Broad. Companies, Inc., 186 F.3d 1200, 1202–03
(9th Cir. 1999).

Yoshimura’s claim that the Union has not

suggested a criminal or tortious motive is incorrect.

To the

contrary, the Union alleges that “Yoshimura’s illicit conduct
was done for purposes including covering up his own breaches of
fiduciary duties and extorting from [Taketa] . . . the support
and commitment necessary for Yoshimura to be appointed the next

22

EST.”

Compl. ¶ 3. 5

In its Opposition, the Union states that

“breaching one’s fiduciary duties and extortion are unlawful
under federal law.”

Mem. in Opp., at 19 (citing 29 U.S.C.

501(a); 18 U.S.C. § 1951).

Yoshimura does not challenge the

sufficiency or viability of these allegations.

Accordingly, the

Court denies Yoshimura’s Motion in this regard. 6

5

The Complaint additionally alleges that the recordings
were criminal pursuant to Nevada and California law. Compl.
¶ 20. The state laws cited to in the Complaint, however, are
more restrictive wiretapping statutes then the federal version,
as they prohibit the recording of conversations unless all
parties to the conversations have consented. See Nev. Rev.
Stat. § 200.620; Cal. Penal Code § 632(a); see also Buckles v.
Green Tree Servicing, LLC, No. 215CV01581GMNCWH, 2016 WL
3360960, at *2 (D. Nev. May 25, 2016) (“The Nevada Supreme Court
has interpreted Nevada Revised Statutes 200.620 to ‘prohibit the
taping of telephone conversations with the consent of only one
party.’” (citation omitted)). Accordingly, the state laws are
insufficient by themselves to “demonstrate that the interception
of [the] communication[s] was motivated by a tortious purpose
since section 2511 does not punish the taping of the
conversation itself but rather the improper use of the recording
by the party who intercepted the communications.” Buckingham v.
Gailor, No. 00-CV-1568, 2001 WL 34036325, at *5–6 (D. Md. Mar.
27, 2001), aff’d sub nom. Buckingham ex rel. Buckingham v.
Gailor, 20 F. App’x 243 (4th Cir. 2001); see also Sussman, 186
F.3d at 1202–03; Roberts v. Americable Int’l Inc., 883 F. Supp.
499, 503 (E.D. Cal. 1995) (“However, the court will not
interpret the federal limited permission to intercept oral
conversations granted by § 2511(2)(d) to be negated by state law
which itself may invalidate such interception, and which itself
may render such interception tortious.”).
6

Yoshimura also argues that with respect to one of the
secret recordings, “the recording took place over a speaker
phone” and claims that “[a] conversation recorded on a speaker
phone ‘was not intercepted within the meaning of the federal[]
wiretapping act[].’” Mot., at 12 (alterations in original)
(quoting T.B. Proprietary Corp. v. Sposato Builders, Inc., No.
(continued . . . )
23

CONCLUSION
For the foregoing reasons, the Court DENIES Defendant
Lance Yoshimura’s Motion to Dismiss the Complaint or in the
Alternative for Judgment on the Pleadings, ECF No. 12.
IT IS SO ORDERED.
DATED:

Honolulu, Hawaii, September 12, 2016

________________________________
Alan C. Kay
Sr. United States District Judge

Hawaii Regional Council of Carpenters et al. v. Yoshimura, Civ. No. 16-00198
Order Denying Defendant’s Motion to Dismiss the Complaint or in the
Alternative for Judgment on the Pleadings

( . . . continued)
CIV. A. 94-6745, 1996 WL 290036, at *5 (E.D. Pa. May 31, 1996)).
However, this allegation apparently only pertains to one of the
allegedly recorded conversations. Moreover, as noted by the
Union, the Complaint does not allege that the recording took
place over a speaker phone. Accordingly, the Court may not
consider Yoshimura’s claim at this stage of the proceedings.
24