Lake v. Ohana Military Communities, LLC

Filing 155

ORDER Denying Plaintiffs' Motion For Class Certification re 127 . On the basis of the foregoing, Plaintiffs Motion for Class Certification, filed March 22, 2019, which is CONSTRUED as a motion for leave to file a second amended complaint, is HEREBY DENIED. Signed by JUDGE LESLIE E. KOBAYASHI on 5/31/2019. (cib)

UNITED STATES DISTRICT COURT
DISTRICT OF HAWAII

KENNETH LAKE, CRYSTAL LAKE,
HAROLD BEAN, MELINDA BEAN, KYLE
PAHONA, ESTEL PAHONA, TIMOTHY
MOSELEY, ASHLEY MOSELEY, RYAN
WILSON, and HEATHER WILSON,

CIV. NO. 16-00555 LEK

Plaintiffs,
vs.
OHANA MILITARY COMMUNITIES, LLC,
FOREST CITY RESIDENTIAL
MANAGEMENT, INC., DOE
DEFENDANTS 1-10,
Defendants.

ORDER DENYING PLAINTIFFS’ MOTION FOR CLASS CERTIFICATION
On March 22, 2019, Plaintiffs Kenneth Lake,
Crystal Lake, Harold Bean, Melinda Bean, Kyle Pahona,
Estel Pahona, Timothy Moseley, Ashley Moseley, Ryan Wilson, and
Heather Wilson (“Plaintiffs”) filed their Motion for Class
Certification (“Motion”).1

[Dkt. no. 127.]

On April 2, 2019,

the Court issued an Order to Show Cause (“OSC”), requiring
Plaintiffs to file a response showing why the Motion should not
be summarily denied.

1

[Dkt. no. 131.]

Plaintiffs filed their

After the filing of the Motion, the parties stipulated to
the dismissal with prejudice of all claims by Plaintiff Estel
Pahona. [Stipulation for Partial Dismissal, filed 4/24/19 (dkt.
no. 139).]

response to the OSC (“OSC Response”) on April 12, 2019.
no. 134.]

[Dkt.

The Court finds this matter suitable for disposition

without a hearing pursuant to Rule LR7.2(d) of the Local Rules
of Practice of the United States District Court for the District
of Hawai`i (“Local Rules”).

On April 16, 2019, this Court

issued an entering order informing the parties of its ruling on
the Motion.

[Dkt. no. 135.]

entering order.

The instant Order supersedes that

Plaintiffs’ Motion is hereby denied for the

reasons set forth below.
BACKGROUND
Plaintiffs Kenneth Lake, Crystal Lake, Harold Bean,
Melinda Bean, Kyle Pahona, Estel Pahona, Timothy Moseley, and
Ashley Moseley filed their Complaint in state court on
September 14, 2016.

[Notice of Removal, filed 10/13/16 (dkt.

no. 1), Decl. of Christine A. Terada, Exh. 1.]

Ryan Wilson and

Heather Wilson were added as plaintiffs when the First Amended
Complaint was filed on September 20, 2017.

[Dkt. no. 75.]

The

First Amended Complaint remains the operative pleading.
Plaintiffs are current or former residents of housing
at Kaneohe Marine Corps Base Hawaii (“MCBH”).

The crux of

Plaintiffs’ claims is that the soil in some of the residential
neighborhoods at MCBH is contaminated, and Defendants Ohana
Military Communities, LLC (“Ohana”) and Forest City Residential
Management, LLC (“Forest City” and collectively, “Defendants”)
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failed to: 1) perform adequate remediation measures; and
2) disclose the contamination to Plaintiffs.

Plaintiffs allege

they were all exposed to the contaminated soil because the soil
in their respective MCBH neighborhoods was contaminated and/or
they routinely visited, and traveled through, neighborhoods with
contaminated soil.
The First Amended Complaint alleges the following
claims: breach of contract against Ohana (“Count I”); breach of
the implied warranty of habitability against Ohana (“Count II”);
a Haw. Rev. Stat. Chapter 521 claim against Defendants
(“Count III”); an unfair and deceptive acts or practices
(“UDAP”) claim against Defendants (“Count IV”); a negligent
failure to warn claim against Defendants (“Count V”); a
negligent infliction of emotional distress claim and an
intentional infliction of emotional distress claim against
Defendants (“Count VI”); a fraud claim against Defendants
(“Count VII”); a negligent misrepresentation claim against
Defendants (“Count VIII”); an unfair methods of competition
(“UMOC”) claim against Defendants (“Count IX”); a trespass claim
against Defendants (“Count X”); and a nuisance claim against
Defendants (“Count XI”).

Counts IV and IX were stricken because

this Court previously dismissed Plaintiffs’ UDAP and UMOC claims
with prejudice.

[Order Granting in Part and Denying in Part

Defs.’ Motion to Dismiss and/or Strike Pltfs.’ First Amended
3

Complaint [Dkt 75], filed 5/31/18 (dkt. no. 98) (“5/31/18
Order”), at 6.2]

Count X was stricken because Plaintiffs failed

to seek leave to amend that claim.

5/31/18 Order, 2018 WL

2449188, at *3 (citing dkt. no. 81).

The portion of Count III

based on Haw. Rev. Stat. § 521-42(a)(1) was dismissed with
prejudice, id. at *7, as were Harold Bean and Melinda Bean’s and
Timothy Moseley and Ashley Moseley’s claims in Count XI, id. at
*10.

All other claims in the First Amended Complaint remain.

See id.
Plaintiffs do not dispute that the First Amended
Complaint does not plead this case as a class action, nor does
it contain class allegations.

In spite of the lack of class

allegations, the instant Motion asks this Court to certify the
following damages class, pursuant to Fed. R. Civ. P. 23(b)(3):
“All persons who leased or resided in residential properties
leased from Ohana Military Communities, LLC, at Marine Corps
Base Hawaii (‘MCBH’) in Kaneohe, Oahu, Hawaii, between 2006 to
present.”

[Motion at iii.]
STANDARD
To the extent that Plaintiffs propose to convert this

case into a class action, they seek to expand the scope of the
case to assert the claims of, and to seek relief on behalf of,

2

The 5/31/18 Order is also available at 2018 WL 2449188.
4

persons who are not identified as plaintiffs in the First
Amended Complaint.

Thus, as to the proposed class members, the

First Amended Complaint is not “a short and plain statement of
the claim showing that the pleader is entitled to relief,” nor
does it include “a demand for the relief sought.”
Civ. P. 8(a)(1)-(2).

See Fed. R.

The Motion is therefore construed as a

motion for leave to file a second amended complaint,3 which would
plead the case as a class action.
The following standards apply to a motion for leave to
file an amended complaint:
Rule 15(a) of the Federal Rules of Civil
Procedure states that leave to amend a complaint
should be freely given “when justice so
requires.” Fed. R. Civ. P. 15(a)(2). In
determining whether to allow amendment of a
complaint, courts consider factors such as:
whether the amendment will cause undue delay;
whether the movant has demonstrated bad faith or
a dilatory motive; whether the amendment will
unduly prejudice the opposing party; whether
amendment is futile; and whether the movant has
repeatedly failed to cure deficiencies. See
Foman v. Davis, 371 U.S. 178, 182 (1962). . . .
Gilliam v. Glassett, CIVIL NO. 18-00317 SOM/RLP, 2019 WL 475008,
at *1 (D. Hawai`i Feb. 6, 2019).

3

Plaintiffs filed the Motion on the deadline for the filing
of motions to add parties and amend pleadings. See Amended
Rule 16 Scheduling Order (“Scheduling Order”), filed 9/13/18
(dkt. no. 106), at ¶ 5.
5

DISCUSSION
Plaintiffs had notice that they had to satisfy the
standards summarized in Gilliam.

[OSC at 2.]

Plaintiffs’ OSC

Response, however, does not meet the applicable standards.
First, converting the instant case into a class action
would result in undue delay.

The trial in this case is set to

begin on October 21, 2019, and Plaintiffs filed the instant
Motion only seven months before the trial date.
Order at ¶ 1.

See Scheduling

Thus, the other relevant deadlines have already

passed or are too imminent to accommodate a class action.

See,

e.g., id. at ¶ 7 (stating the dispositive motions deadline was
5/22/19),4 ¶ 11 (stating Plaintiffs’ expert witness disclosure
deadline was 4/22/19 and Defendants’ was 5/22/19), ¶ 12 (stating
the discovery deadline is 8/23/19).

Converting the instant case

into a class action would require a substantial continuance of
the trial date and would require the reopening of case deadlines
that have passed, such as the dispositive motions deadline and
the expert disclosure deadlines.
Further, this case has been pending for two-and-a-half
years, and Plaintiffs and their counsel were aware from the

4

Defendants filed three motions for summary judgment on
May 22, 2019. [Dkt. nos. 145, 147, 150.] Two of the motions
are scheduled for hearing on July 19, 2019, and the other is
scheduled for hearing on September 6, 2019.
6

outset of the arguable basis for class treatment of the claims.
This Court has already noted that Barber v. Ohana Military
Communities, LLC, et al., CV 14-00217 HG-KSC, was a putative
class action brought by other MCBH residents alleging claims
against Ohana and Forest City that were similar to Plaintiffs’
claims in the instant case.

See, e.g., Order Granting in Part

and Denying in Part Defs.’ Motion to Dismiss, filed 8/1/17 (dkt.
no. 63) (“8/1/17 Order”), at 7 & n.4.5

Barber settled before

there was a final ruling on the issue of class certification.
[Barber, Minutes, filed 1/5/16 (dkt. no. 265), at 1 (noting the
parties’ settlement on the record and the termination of both
the magistrate judge’s findings and recommendation to deny the
plaintiffs’ motion for class certification and their objection
to the findings and recommendation).]

Plaintiffs’ counsel in

the instant case were among the counsel who represented the
plaintiffs in Barber.

In fact, Plaintiffs have asserted that,

after the Barber settlement, their counsel sent a notice to
potential members of the proposed class in Barber to inform them
about the settlement and how their rights may be affected.
[Order Denying Defs.’ Motion to Disqualify Counsel and/or for
Sanctions and Denying Pltfs.’ Motion for Remand, filed 3/15/17
(dkt. no. 49), at 21.]

5

However, although Plaintiffs and their

The 8/1/17 Order is also available at 2017 WL 4563079.
7

counsel were aware of the potential for class claims, Plaintiffs
filed two versions of the complaint in this case and failed to
include class allegations.
the instant Motion.

This suggests a dilatory motive in

The delayed attempt to raise the class

issues that Plaintiffs and their counsel have long been aware of
is also akin to a plaintiff who repeatedly fails to cure known
deficiencies in his pleading.

Thus, the relevant Foman factors

warrant a ruling that Plaintiffs are not entitled to file a
second amended complaint, even under the liberal Rule 15(a)
standard.
Finally, this Court rejects Plaintiffs’ contention
that the filing of a second amended complaint is not necessary.
Plaintiffs argue this Court has already “created a de facto
class action” by staying and administratively closing the
subsequently filed cases that are related to the instant case
(“Related Cases”).

See OSC Response at 3; see also, e.g.,

Butler, et al. v. Ohana Military Communities, LLC, et al., CV
16-00626 LEK-KJM, EO: Court Order Administratively Closing Case,
filed 10/2/18 (dkt. no. 26) (staying Butler and administratively
closing it, pending the conclusion of Lake).6

6

Plaintiffs’

The other Related Cases are: Dix, et al. v. Ohana Military
Communities, LLC, et al., CV 16-00627 LEK-KJM; Manaea, et al. v.
Ohana Military Communities, LLC, et al., CV 16-00628 LEK-KJM;
Ochoa, et al. v. Ohana Military Communities, LLC, et al., CV 1600629 LEK-KJM; Bartlett, et al. v. Ohana Military Communities,
(. . . continued)
8

argument is both mistaken and unsupported by any legal
authority.

The stay of the Related Cases did not place the

claims of previously unidentified persons before this Court.
The stay merely recognizes that, after certain common issues are
resolved in the instant case, they will not need to be relitigated to resolve the claims of the plaintiffs in the Related
Cases.

Further, the statement by Plaintiffs’ counsel during a

September 4, 2018 status conference that Plaintiffs wanted to
revisit pursuing the instant case as a class action, [OSC
Response at 3 n.6 (citing the Minutes of the status
conference),] is irrelevant because Plaintiffs did not seek
leave to file their second amended complaint until March 22,
2019, and Plaintiffs never submitted a proposed second amended
complaint.

See Local Rule LR10.3 (“Any party filing or moving

to file an amended complaint . . . shall reproduce the entire
pleading as amended and may not incorporate any part of a prior
pleading by reference, except with leave of court.”).
Plaintiffs’ Motion, even when read together with their
OSC Response, does not present any circumstances that warrant

LLC, et al., CV 16-00654 LEK-KJM; Torres, et al. v. Ohana
Military Communities, LLC, et al., CV 16-00655 LEK-KJM; Hayes,
et al. v. Ohana Military Communities, LLC, et al., CV 17-00047
LEK-KJM; and Pye, et al. v. Ohana Military Communities, LLC, et
al., CV 17-00114 LEK-KJM. None of the Related Cases is a class
action.
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the granting of leave to file a second amended complaint which
would: 1) convert the instant case into a class action; and 2)
add class allegations.

Because Plaintiffs are denied leave to

file a second amended complaint, it is not necessary to address
whether Plaintiffs’ proposed class can be certified.
CONCLUSION
On the basis of the foregoing, Plaintiffs’ Motion for
Class Certification, filed March 22, 2019, which is CONSTRUED as
a motion for leave to file a second amended complaint, is HEREBY
DENIED.
IT IS SO ORDERED.
DATED AT HONOLULU, HAWAI`I, May 31, 2019.

KENNETH LAKE, ET AL. VS. OHANA MILITARY COMMUNITIES, LLC, ET AL;
CV 16-00555 LEK-KJM; ORDER DENYING PLAINTIFFS' MOTION FOR CLASS
CERTIFICATION

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