Lake v. Ohana Military Communities, LLC
Filing
98
ORDER GRANTING IN PART AND DENYING IN PART GRANTING IN PART AND DENYING IN PART PLAINTIFFS FIRST AMENDED COMPLAINT [DKT 75 ] re 76 Motion to Dismiss. Signed by JUDGE LESLIE E. KOBAYASHI on 05/31/2018. Defenda nts' Motion to Dismiss and/or Strike Plaintiffs' First Amended Complaint [Dkt 75], filed October 4, 2017, is HEREBY GRANTED IN PART AND DENIED IN PART. The Motion is GRANTED insofar as: Plaintiffs' UDAP and UMOC claims are STRICKEN; Pl aintiffs' Haw. Rev. Stat. Chapter 521 claim alleging a violation of Haw. Rev. Stat. § 521-42(a)(1) is DISMISSED WITH PREJUDICE; the Beans' nuisance claim is DISMISSED WITH PREJUDICE; and the Moseleys' nuisance claim is DISMISSED W ITH PREJUDICE. The Motion is DENIED in all other respects.Defendants are ORDERED to file their answer(s) to the remaining portions of the First Amended Complaint by June 29, 2018. This Court EMPHASIZES that the filing of any motion for reconsider ation of this Order will not affect the deadline for Defendants' answer(s). If a motion for reconsideration is filed and granted, this Court will allow Defendants to amend their answer to the First Amended Complaint, if necessary.IT IS SO ORDERED (eps, )
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
KENNETH LAKE, CRYSTAL LAKE,
HAROLD BEAN, MELINDA BEAN,
KYLE PAHONA, ESTEL PAHONA,
TIMOTHY MOSELEY, ASHLEY
MOSELEY, RYAN WILSON, and
HEATHER WILSON
)
)
)
)
)
)
)
Plaintiffs,
)
)
vs.
)
)
)
OHANA MILITARY COMMUNITIES,
LLC, FOREST CITY RESIDENTIAL )
)
MANAGEMENT, INC.; and DOE
)
DEFENDANTS 1-10,
)
)
Defendants.
_____________________________ )
CIVIL 16-00555 LEK-KJM
ORDER GRANTING IN PART AND DENYING IN PART
DEFENDANTS’ MOTION TO DISMISS AND/OR STRIKE
PLAINTIFFS’ FIRST AMENDED COMPLAINT [DKT 75]
On October 4, 2017, Defendants Ohana Military
Communities, LLC (“Ohana”) and Forest City Residential
Management, LLC (“Forest City” and collectively, “Defendants”)
filed their Motion to Dismiss and/or Strike Plaintiffs’ First
Amended Complaint [Dkt 75] (“Motion”).1
[Dkt. no. 76.]
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
1
Defendants state that Forest City Residential Management,
LLC is the successor by conversion to Forest City Residential
Management, Inc. [Mem. in Supp. of Motion at 2-3.] Forest City
Residential Management, Inc. is the entity named in the First
Amended Complaint and reflected in the district court’s docket.
memorandum in opposition on December 13, 2017, and Defendants
filed their reply on December 20, 2017.
[Dkt. nos. 79, 82.]
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”).
Defendants’ Motion is hereby granted in part
and denied in part for the reasons set forth below.
Specifically, the Motion is granted insofar as: Plaintiffs’
unfair and deceptive acts or practices (“UDAP”) claim and unfair
methods of competition (“UMOC”) claim are stricken; Plaintiffs’
claim that Defendant breached the landlord tenant code by failing
to comply with the applicable building codes and housing laws is
dismissed with prejudice; Plaintiffs Harold Bean and Melinda
Bean’s (“the Beans”) nuisance claim is dismissed with prejudice;
and Plaintiffs Timothy Moseley and Ashley Moseley’s (“the
Moseleys”) nuisance claim is dismissed with prejudice.
The
Motion is denied in all other respects.
BACKGROUND
Plaintiffs filed their Complaint in state court on
September 14, 2016.
October 13, 2016.
Defendants filed its Notice of Removal on
[Dkt. no. 1.]
The factual allegations of the
Complaint are summarized in this Court’s August 1, 2017 Order
2
Granting in Part and Denying in Part Defendants’ Motion to
Dismiss (“8/1/17 Order”).
[Dkt. no. 63.2]
The Complaint alleged the following claims: breach of
contract against Ohana (“Count I”); breach of the implied
warranty of habitability against Ohana (“Count II”); a claim
against Defendants for violation of the Landlord Tenant Code,
Haw. Rev. Stat. Chapter 521 (“Chapter 521” and “Count III”); an
unfair and deceptive trade practices (“UDAP”) claim against
Defendants pursuant to Haw. Rev. Stat. § 480-2 (“Count IV”); a
negligent failure to warn claim against Defendants (“Count V”); a
claim against Defendants for negligent infliction of emotional
distress (“NIED”) and intentional infliction of emotional
distress (“IIED” and “Count VI”); a fraud claim against
Defendants (“Count VII”); a negligent misrepresentation claim
against Defendants (“Count VIII”); an unfair competition claim
(“UMOC”) against Defendants pursuant to § 480-2(a) (“Count IX”);
a trespass claim against Defendants (“Count X”); and a nuisance
claim against Defendants (“Count XI”).
The 8/1/17 Order dismissed Counts IV, IX, and X with
prejudice, and dismissed all of the remaining claims without
prejudice.
2017 WL 4563079, at *12.
2
On reconsideration, the
The 8/1/17 Order is also available at 2017 WL 4563079.
The 8/1/17 Order ruled on Defendants’ October 20, 2016 motion to
dismiss the original Complaint, [dkt. no. 8,] which will be
referred to as “the Original Motion to Dismiss.”
3
dismissal of Count X was changed to a dismissal without prejudice
to the filing of a motion seeking leave to file a second amended
complaint alleging a revised trespass claim.
[Order Granting in
Part and Denying in Part Pltfs.’ Motion for Reconsideration of
Order Granting in Part and Denying in Party Defs.’ Motion to
Dismiss, filed 10/12/17 (dkt. no. 78) (“10/12/17 Order”), at 8.3]
Plaintiffs filed their First Amended Complaint on
September 20, 2017.
[Dkt. no. 75.]
Plaintiffs Ryan and Heather
Wilson (“the Wilsons”) were added to the caption.
Complaint at pg. 1.]
[First Amended
The Wilsons were not listed on the docket
sheet as plaintiffs because they were not included in the caption
of the original Complaint, but they were included in the
Complaint’s section identifying the parties.
[Notice of Removal,
Decl. of Christine A. Terada, Exh. 1 (Complaint) at pg. 1 &
¶ 154.]
The most relevant new factual allegations in the First
Amended Complaint are summarized below:
-identification of the specific addresses at Kaneohe Marine Corp
Base Hawaii (“MCBH”) where Plaintiffs currently reside
(Plaintiffs Kyle and Estel Pahona (“the Pahonas”)) or
previously resided (all other Plaintiffs); [First Amended
Complaint at ¶¶ 6-10;]
-general allegations that Plaintiffs and their families routinely
traveled to and visited different neighborhoods in MCBH, and
therefore even Plaintiffs who did not live within MCBH
neighborhoods where the soil was allegedly contaminated were
exposed to the contaminants during those visits and travels;
and Plaintiffs whose homes were not contaminated were
3
The 10/12/17 Order is also available at 2017 WL 4560123.
4
exposed to contaminated construction dust if their homes
were near remediation sites; [id. at ¶¶ 37-38;]
-allegations regarding how each of Plaintiffs’ families “observed
and were routinely exposed to dust and dirt from the
demolition and construction of homes at MCBH”; [id. at
¶¶ 39-39.e, 43;]
-allegations that
blowing from
construction
their homes,
43;]
Plaintiffs generally observed construction dust
MCBH construction sites and experienced
dust settling on the exterior and interior of
vehicles, and other possessions; [id. at ¶¶ 40-
-allegations that the construction dust required Plaintiffs to
spend additional time cleaning their homes and personal
property and to purchase additional cleaning supplies and
air filtration products; [id. at ¶¶ 41-44;]
-allegations that the constant construction dust prevented
Plaintiffs from using and enjoying their homes and their
communities to the extent they would have done without the
dust; [id. at ¶ 45;]
-allegations that, before entering into their leases, Plaintiffs
were never told that: residential neighborhoods at MCBH had
soil and construction dust that were contaminated with
pesticides; Ohana adopted a Pesticide Soils Management Plan
(“Soil Plan”) to address the pesticide contamination at
MCBH; [id. at ¶¶ 46-47;] Ohana “was creating pesticidecontaminated landfills below ‘new’ neighborhoods it was
leasing to military families”; [id. at ¶ 48;] they should
take precautions to avoid or minimize contact with soil,
dirt, and dust at MCBH; and Plaintiffs’ families would be
exposed to increased risks of cancer and other health
outcomes; [id. at ¶¶ 49-50;]
-allegations that, had Defendants properly informed them about
the above, Plaintiffs would not have chosen to live at MCBH;
[id. at ¶¶ 52-55;] further, because of these conditions and
because of the failure to disclose, Defendants charged
Plaintiffs more for their rental homes at MCBH than
Defendants would have been able to charge if proper
disclosures had been made; [id. at ¶ 56;]
-allegations that, because Defendants did not warn Plaintiffs
about the risks, Plaintiffs, their families, and pets came
5
in contact with dust, dirt, and soil in MCBH without taking
necessary precautions; [id. at ¶ 51;] and
-allegations that, because of Defendants’ actions, “Plaintiffs
are extremely concerned, fearful, and worried that they and
their families have been exposed to dangerous chemicals and
higher rates of adverse health outcomes while living at MCBH
for themselves and their families” and they believe they
have been denied “the MCBH community they were promised by
Defendants,” [id. at ¶¶ 57-58].
The First Amended Complaint alleges the same claims as
the original Complaint: breach of contract against Ohana
(“Amended Count I”); breach of the implied warranty of
habitability against Ohana (“Amended Count II”); a Chapter 521
claim against Defendants (“Amended Count III”); a UDAP claim
against Defendants (“Amended Count IV”); a negligent failure to
warn claim against Defendants (“Amended Count V”); an NIED claim
and an IIED claim against Defendants (“Amended Count VI”); a
fraud claim against Defendants (“Amended Count VII”); a negligent
misrepresentation claim against Defendants (“Amended
Count VIII”); a UMOC claim against Defendants (“Amended
Count IX”); a trespass claim against Defendants (“Amended
Count X”); and a nuisance claim against Defendants (“Amended
Count XI”).
Amended Counts IV and IX were improperly included in
the First Amended Complaint because Plaintiffs’ UDAP and UMOC
claims have already been dismissed with prejudice.
Counts IV and IX are therefore stricken.
6
Amended
On December 20, 2017, this Court issued an order
striking Amended Count X because Plaintiffs failed to file a
motion seeking leave to plead a revised trespass claim.
no. 81.]
[Dkt.
On February 28, 2018, Plaintiffs filed a motion seeking
leave to amend the First Amended Complaint to add a trespass
claim, but the magistrate judge denied the motion in an order
issued on April 17, 2018.
[Dkt. nos. 90, 97.]
Plaintiffs did
not appeal the magistrate judge’s order to this Court.
Only Amended Counts I, II, III, V, VI, VII, VIII, and
XI will be addressed in this Order.
The relevant portions of the
new factual allegations, as well as more detailed discussion of
Plaintiffs’ damages, have been added to each Amended Count.
See,
e.g., First Amended Complaint at ¶¶ 65-66 (Amended Count I),
¶¶ 72-74 (Amended Count II), ¶ 82 (Amended Count III), ¶¶ 98, 102
(Amended Count V), ¶¶ 112-13 (Amended Count VI), ¶¶ 112, 117-18
(first of two) (Amended Count VII),4 ¶¶ 130, 135 (Amended
Count VIII), ¶¶ 160-61, 163 (Amended Count XI).
In the instant Motion, Defendants argue the additional
factual allegations in the First Amended Complaint are
insufficient to cure: the standing defect identified in the
8/1/17 Order; and the defects in Plaintiffs’ claims that
4
The First Amended Complaint is misnumbered. Although
Amended Count VI ends with paragraph 117, Amended Count VII
starts with paragraph 103 and contains two paragraphs numbered
118. [First Amended Complaint at pgs. 43-49.]
7
Defendants identified in the Original Motion to Dismiss but were
not addressed in the 8/1/17 Order.
Defendants urge this Court to
dismiss all of Plaintiffs’ remaining claims with prejudice.
DISCUSSION
I.
Standing
In the 8/1/17 Order, this Court stated:
As to every remaining claim, each Plaintiff must
plead sufficient factual content to draw the
reasonable inference that he or she suffered an
actual injury in fact – or faces an imminent
injury – that is fairly traceable to Defendants’
alleged actions and omissions, and that is likely
to be redressed by a judgment in his or her favor.
Plaintiffs have pled some factual allegations
regarding soil contamination and construction dust
at MCBH in general, but they have not pled
sufficient factual allegations to allow this Court
to draw the reasonable inference that each
Plaintiff has suffered, or is imminently facing,
an actionable injury. This Court therefore
concludes that Counts I, II, III, V, VI, VII,
VIII, and XI fail to state plausible claims for
relief because Plaintiffs have not pled sufficient
allegations regarding their standing to pursue
these claims. . . .
2017 WL 4563079, at *12 (citations omitted).
The First Amended Complaint alleges all Plaintiffs
experienced construction dust at MCBH settling on their rental
homes, their persons, and/or their personal property, including
during Plaintiffs’ routine travels and visits to parts of MCBH
beyond the immediate areas of their rental homes.
This dust
allegedly: caused Plaintiffs to spend additional time cleaning
their homes and personal property; caused them to spend
8
additional resources on cleaning and air filtration supplies; and
prevented them from using and enjoying their homes and the MCBH
community as they would have without the dust.
Complaint at ¶¶ 39-45.]
[First Amended
Plaintiffs allege Defendants now admit
some of the MCBH neighborhoods “contained homes and soils
contaminated by pesticides and other contaminants (asbestos,
lead-based paint, extensive mold infestation, and other toxins).”
[Id. at ¶ 38.]
Plaintiffs allege all of them either lived in
these “contaminated” neighborhoods or were regularly exposed to
those neighborhoods because their daily lives involved regular
travel “between MCBH neighborhoods on their way to various
destinations.”
[Id. at ¶¶ 37-38.]
Further, Plaintiffs assert
that, before they entered into their leases for their MCBH homes,
they were not told about pesticide-contaminated soil and
construction dust in the MCBH residential neighborhoods.
¶ 46.]
[Id. at
They state that, if they had been told about the
contamination, “they would not have chosen MCBH housing for their
family and/or would have taken additional steps to have protected
their famil[ies].”
[Id. at ¶ 52.]
Plaintiffs also allege the
pesticide contamination at MCBH “exposed military families at
MCBH to unsafe conditions including higher rates of cancer and
other adverse health outcomes.”
[Id. at ¶ 33.]
In considering Defendants’ Motion, all of Plaintiffs’
factual allegations are assumed to be true.
9
See Ashcroft v.
Iqbal, 556 U.S. 662, 678 (2009) (“for the purposes of a motion to
dismiss we must take all of the factual allegations in the
complaint as true” (citing Bell Atlantic Corp. v. Twombly, 550
U.S. 544, 555 (2007))).
In light of that assumption, Plaintiffs
have pled sufficient facts supporting a reasonable inference that
each Plaintiff has standing because he or she has suffered an
actionable injury.
See id. (“A claim has facial plausibility
when the plaintiff pleads factual content that allows the court
to draw the reasonable inference that the defendant is liable for
the misconduct alleged.” (citing Twombly, 550 U.S. at 556)).
To the extent the Motion argues Plaintiffs failed to
plead sufficient standing allegations, the Motion is denied.
The
Court now turns to Defendants’ challenges to each of Plaintiffs’
claims.
II.
Amended Count I – Breach of Contract
Defendants argue Amended Count I fails because the
First Amended Complaint does not identify the specific
contractual provision Ohana allegedly violated.
Amended Count I
alleges Ohana failed to:
“a. Disclose the presence, nature, or extent of pesticidecontaminated soils at MCBH; b. Provide safe and habitable
housing; c. Provide a safe and habitable community at MCBH; and
d. Disclose or fully implement its Pesticide Soil Management
Plan.”
[First Amended Complaint at ¶ 63.]
10
The First Amended
Complaint alleges that paragraph 12 of the MCBH leases states the
“Owner” – i.e., Ohana by and through Forest City – “is
responsible for maintenance and repair of the Premises, and for
ensuring that the Premises are safe and habitable.”
43 n.21.]
[Id. at pg.
This allegation appears within another count, but,
when the First Amended Complaint is read as a whole, it is
apparent that Defendants’ alleged failure to provide safe and
habitable housing violated a specific provision of the leases.
In addition, the First Amended Complaint alleges: Plaintiffs’
MCBH leases contained a mediation provision; Plaintiffs demanded
Ohana mediate regarding its failure to disclose the contamination
issues and its failure to provide safe and habitable housing; and
Ohana refused to mediate with Plaintiffs, in violation of the
mediation provision.
[Id. at ¶¶ 34-36.]
Defendants argue there is no specific provision of
Plaintiffs’ MCBH leases that would support Plaintiffs’
allegations about the safety and habitability of the MCBH
community in general.
However, the First Amended Complaint
alleges Defendants’ Residential Community Handbook for Marine
Corps Neighborhoods (“Community Handbook”) is provided to MCBH
residents, and the leases require the residents to agree to
comply with the handbook.
[Id. at ¶¶ 32.a & n.11.]
According to
the First Amended Complaint, the Community Handbook represented
“Defendants would provide ‘exceptional service,’” [id. at ¶ 87.a
11
& n.20 (quoting Community Handbook at 1),] as well as “‘safe and
healthy premises,’” [id. at ¶ 87.a & n.20 (quoting Community
Handbook at 15)].
It can be reasonably inferred from the factual
allegations of the First Amended Complaint that: the Community
Handbook was incorporated into Plaintiffs’ MCBH leases; both
Plaintiffs and Defendants had obligations under the Community
Handbook; and those obligations related to areas beyond the
specific homes that were the subject of the MCBH leases.
Read as
a whole, the First Amended Complaint alleges sufficient factual
allegations to support a plausible position that Defendants
agreed to provide safe and habitable conditions in the MCBH
community generally.
“The elements of a breach of contract claim are (1) the
contract at issue; (2) the parties to the contract; (3) whether
plaintiff performed under the contract; (4) the particular
provision of the contract allegedly violated by defendants; and
(5) when and how defendants allegedly breached the contract.”
Marine Lumber Co. v. Precision Moving & Storage Inc.,
CIVIL 16-00365 LEK-RLP, 2017 WL 1159093, at *6 (D. Hawai`i
Mar. 28, 2017) (citation and internal quotation marks omitted).
The First Amended Complaint alleges sufficient facts to support
each element, and therefore Amended Count I states a plausible
breach of contract claim.
Defendants’ Motion is denied as to
Amended Count I.
12
III. Amended Count II – Breach of the
Implied Warranty of Habitability
Other than the standing argument this Court has already
rejected, Defendants do not present any other arguments why
Amended Count II fails to state a plausible claim for relief.
See, e.g., Mem. in Supp. of Motion at 20 (“Counts 1, 3, 5-8, and
11 Should Be Dismissed for Failure to Plead Necessary Elements of
Each Claim”).
Defendants have failed to identify a defect in
Amended Count II that warrants dismissal.
A property owner breaches the implied
warranty of habitability if he leases his property
with a defect or unsafe condition that is “of a
nature and kind which will render the premises
unsafe, or unsanitary and thus unfit for living.”
Armstrong v. Cione, 736 P.2d 440, 445 (Haw. Ct.
App. 1987); Lemle v. Breeden, 462 P.2d 470, 474
(Haw. 1969) (recognizing the doctrine of implied
warranty of habitability and finding rat
infestation of leased premises constituted a
breach). The leased premises must be
substantially unsuitable for living so that the
breach of the warranty would constitute a
constructive eviction of the tenant. Armstrong,
736 P.2d at 445.
Barber v. Ohana Military Communities, LLC, Civil No. 14–00217
HG–KSC, 2014 WL 3529766, at *6 (D. Hawai`i July 15, 2014).
The
First Amended Complaint alleges sufficient facts to support each
of the required elements.
This Court concludes that Amended
Count II states a plausible claim for breach of the implied
warranty of habitability and therefore denies Defendants’ Motion
as to Amended Count II.
13
IV.
Amended Count III – Violation of Chapter 521
Amended Count III alleges Defendants violated Haw. Rev.
Stat. §§ 521-10 and 521-42(a)(1).
¶¶ 77-78.]
[First Amended Complaint at
Section 521-10 states: “Every duty imposed by this
chapter and every act which must be performed as a condition
precedent to the exercise of a right or remedy under this chapter
imposes an obligation of good faith in its performance or
enforcement.”
Section 521-42(a) states: “The landlord shall at
all times during the tenancy: (1) Comply with all applicable
building and housing laws materially affecting health and
safety.”
The First Amended Complaint alleges Defendants knew
about widespread pesticide contamination at MCBH but failed to
disclose that fact to Plaintiffs and failed to take adequate
actions to protect Plaintiffs from the contamination, in spite of
their contractual obligation to provide safe and healthy housing.
[First Amended Complaint at ¶¶ 79-80.]
These allegations are
sufficient to support a plausible claim that Defendants failed to
perform their duties and obligations in good faith, in violation
of § 521-10.
Defendants argue § 521-10 does not impose any
actionable duties on them.
Although not cited by Plaintiffs,
Haw. Rev. Stat. § 521-63 states:
(a) If any condition within the premises deprives
the tenant of a substantial part of the benefit
and enjoyment of the tenant’s bargain under the
rental agreement, the tenant may notify the
14
landlord in writing of the situation and, if the
landlord does not remedy the situation within one
week, terminate the rental agreement. The notice
need not be given when the condition renders the
dwelling unit uninhabitable or poses an imminent
threat to the health or safety of any
occupant. . . .
(b) If the condition referred to in subsection
(a) was caused wilfully or negligently by the
landlord, the tenant may recover any damages
sustained as a result of the condition.
As previously noted, Plaintiffs have alleged the contaminated
soil at MCBH deprived them of the use and enjoyment of their
rental homes and of the MCBH community in general and Defendants
have failed to adequately respond to the contamination issues.
Plaintiffs also allege Defendants’ actions were willful and/or
negligent.
This Court concludes the alleged violation of § 521-
10 is actionable pursuant to § 521-63, and therefore denies the
Motion as to the portion of Amended Count III based on § 521-10.
However, Plaintiffs have not identified any specific
“building or housing laws materially affecting health and safety”
that Defendants allegedly violated.
Amended Count III therefore
fails to a state a plausible claim for violation of
§ 521-42(a)(1) and must be dismissed.5
5
This Court acknowledges that the district court in Barber,
which is a related case, ruled otherwise. The district court in
Barber ruled the plaintiffs sufficiently stated a claim for
violation of § 521-42(a)(1), which it described as “the Hawaii
state statutory codification of the implied warranty of
habitability.” 2014 WL 3529766, at *7-8. This Court
respectfully disagrees, based on the plain language of
(continued...)
15
“As a general rule, dismissal without leave to amend is
improper unless it is clear, upon de novo review, that the
complaint could not be saved by any amendment.”
Sonoma Cty.
Ass’n of Retired Emps. v. Sonoma Cty., 708 F.3d 1109, 1118 (9th
Cir. 2013) (brackets, citation, and internal quotation marks
omitted).
In the Original Motion to Dismiss, Defendants argued
Plaintiffs did not allege a violation of “‘applicable building or
housing laws materially affecting health and safety.’”
Supp. of Original Motion to Dismiss at 26.]
[Mem. in
Although this issue
was not addressed in the 8/1/17 Order because the standing issue
was dispositive, Plaintiffs had notice of this defect in their
§ 521-42(a)(1) claim, and they failed to cure it when they filed
their First Amended Complaint.
Further, Plaintiff’s memorandum
in opposition to the instant Motion does not identify how
Plaintiffs would amend this claim, if given the opportunity to do
so.
These facts give “a strong indication that the plaintiffs
have no additional facts to plead.”
See Zucco Partners, LLC v.
Digimarc Corp., 552 F.3d 981, 1007 (9th Cir. 2009) (citation and
quotation marks omitted).
This Court therefore concludes
Plaintiff would not be able to cure the defect in their
§ 521-42(a)(1) claim by amendment.
5
Defendants’ Motion is granted
(...continued)
§ 521-42(a)(1), which refers to “building and housing laws.”
16
insofar as the portion of Amended Count III based on
§ 521-42(a)(1) is dismissed with prejudice.
V.
Amended Count V – Negligent Failure to Warn
Defendants argue Amended Count V fails because
Plaintiffs do not sufficiently allege how they were impacted by
contaminated construction dust.
Based on the same allegations
discussed regarding Plaintiffs’ standing, this Court concludes
Plaintiffs have pled sufficient factual allegations to support a
plausible claim for negligent failure to warn.
See generally
Barber, 2014 WL 3529766, at *9 (discussing the elements of a
negligence claim and the duty to warn).
Defendants’ Motion is
denied as to Amended Count V.
VI.
Amended Count VI – IIED and NIED
Defendants argue Amended Count VI fails because
Plaintiffs have not pled sufficiently outrageous conduct to
support an IIED claim, and they have not pled the physical
manifestation of harm required to support an NIED claim based on
injury to property.
A.
IIED
Barber also involved an IIED claim.
The district court
identified the elements of an IIED claim as:
(1) that the act allegedly causing the harm was
intentional or reckless, (2) that the act was
outrageous, and (3) that the act caused
(4) extreme emotional distress to another. Enoka
17
v. AIG Hawaii Ins. Co., Inc., 128 P.3d 850, 872
(Haw. 2006).
The term “outrageous” has been construed to
mean “without just cause or excuse and beyond all
bounds of decency.” Id. (citing Lee v. Aiu, 936
P.2d 655, 670 n.12 (Haw. 1997)). Acting with
tortious or criminal intent, or intent to inflict
emotional distress, does not necessarily rise to
the levels of outrageousness required for an IIED
claim. Soone v. Kyo-Ya Co., Ltd., 353 F. Supp. 2d
1107, 1116 (D. Haw. 2005) (citing Ross v. Stouffer
Hotel Co. Ltd., 879 P.2d 1037, 1048 (Haw.
1994)).[6]
The term “extreme emotional distress”
includes, “inter alia, mental suffering, mental
anguish, nervous shock, and other highly
unpleasant mental reactions.” Enoka, 128 P.3d at
872 (internal quotations omitted).
Plaintiffs have stated that Defendants’
intentional and reckless actions caused “emotional
distress” and “fear.” Knowingly exposing families
to carcinogens and increased health risks may rise
to the level of “outrageousness.” The Complaint
contains sufficient facts to state a claim for
intentional infliction of emotional distress.
Id. at *10-11 (some citations omitted).
the district court in Barber.
This Court agrees with
Based on the factual allegations
of the First Amended Complaint, reasonable people may differ on
the issue of whether Defendants’ conduct was sufficiently
outrageous to support an IIED claim.
Because the issue of
outrageousness cannot be determined in a motion to dismiss,
6
“The question whether the actions of the alleged
tortfeasor are unreasonable or outrageous is for the court in the
first instance, although where reasonable people may differ on
that question it should be left to the jury.” Young v. Allstate
Ins. Co., 119 Hawai`i 403, 429, 198 P.3d 666, 692 (2008).
18
Defendant’s Motion is denied as to the portion of Amended
Count VI alleging an IIED claim.
B.
NIED
The district court in Barber stated the elements of an
NIED claim are:
(1) that the defendant engaged in negligent
conduct; (2) that the plaintiff suffered serious
emotional distress; and (3) that such negligent
conduct of the defendant was a legal cause of the
serious emotional distress. Wood v. Greenberry
Fin. Servs., Inc., 907 F. Supp. 2d 1165, 1186 (D.
Haw. 2012).[7] An NIED claim is merely a
negligence claim alleging a wholly psychic injury.
Duty and breach of duty are essential elements of
an NIED claim and are analyzed utilizing ordinary
negligence principles. Kahoohanohano v. Dep’t of
Human Servs., 178 P.3d 538, 582 (Haw. 2008).
Pursuant to HRS § 663-8.9, a party cannot
bring an NIED claim “if the distress or
disturbance arises solely out of damage to
property or material objects,” unless the
emotional distress results in physical injury to
or mental illness of the person who experiences
the emotional distress. Doe Parents No. 1 v.
Dep’t of Educ., 58 P.3d 545, 580-81 (Haw. 2002).
Requiring physical injury or mental illness as a
predicate injury for an NIED claim attempts to
avoid the possibility of trivial or fraudulent
claims due to the subjective nature of assessing
purely psychological injury, while promoting the
purpose of negligence law. Id. at 579.
The Hawaii Supreme Court has carved out
exceptions to the predicate injury requirement in
cases that provide “the requisite assurance that
plaintiff’s psychological distress is trustworthy
and genuine.” Doe Parents No. 1, 58 P.3d at 581.
No physical manifestation of a psychological
7
Wood was abrogated on other grounds by Compton v.
Countrywide Financial Corp., 761 F.3d 1046 (9th Cir. 2014).
19
injury is required for an NIED claim where a
reasonable person, normally constituted, would be
unable to adequately cope with the mental stress
engendered by the circumstances of the case.
Kahoohanohano, 178 P.3d at 582.
NIED claims have been permitted where a
plaintiff alleged exposure to HIV-positive blood.
John & Jane Roes v. FHP, Inc., 985 P.2d 661, 668
(Haw. 1999). Other claims have been permitted
based on the mishandling of a corpse and negligent
placement of a child in an environment with a
child molester. Freeland v. Cnty[.] of Maui, 2013
WL 6528831, *22 (D. Haw. Dec. 11, 2013).
The Complaint claims Plaintiffs suffered
emotional distress because they were exposed to
carcinogens at Marine Corp Base Hawaii because of
Defendants’ negligent conduct. A defendant may be
liable for negligent infliction of emotional
distress when he causes a plaintiff’s exposure to
a significant health risk. John & Jane Roes, 985
P.2d at 668. Plaintiffs have sufficiently pled a
cause of action for NIED based on the allegations
that Defendants exposed Plaintiffs to significant
health risks.
Id. at *10 (some citations omitted).
district court in Barber.
This Court agrees with the
The factual allegations of the First
Amended Complaint are sufficient to plead a plausible NIED claim
based on exposure to significant health risks.
Defendants’
Motion is denied as to the portion of Amended Count VI alleging
an NIED claim.
VII. Amended Counts VII and VIII –
Fraud and Negligent Misrepresentation
Defendants argue Amended Counts VII and VIII fail
because Plaintiffs have not sufficiently alleged detrimental
reliance.
Reliance is a required element of a claim for
20
intentional/fraudulent misrepresentation and a claim for
negligent misrepresentation.
Fisher v. Grove Farm Co., Inc., 123
Hawai`i 82, 103, 230 P.3d 382, 403 (Ct. App. 2009) (IIED) (citing
Hawaii’s Thousand Friends v. Anderson, 70 Haw. 276, 286, 768 P.2d
1293, 1301 (1989)); Aana v. Pioneer Hi-Bred Intern., Inc., Civil
No. 12–00231 LEK–BMK, 2014 WL 806224, at *12 (D. Hawai`i Feb. 27,
2014) (NIED) (some citations omitted) (citing Zanakis–Pico v.
Cutter Dodge, Inc., 98 Hawai`i 309, 321, 47 P.3d 1222, 1234
(2002)).
Based on the same allegations discussed previously
regarding Plaintiffs’ standing, this Court concludes Plaintiffs
have pled sufficient factual allegations regarding their reliance
to support plausible claims for intentional/fraudulent
misrepresentation and negligent misrepresentation.
See
generally, Barber, 2014 WL 3529766, at *11-12 (discussing fraud,
intentional representation, and negligent misrepresentation).
Defendants’ Motion is denied as to Amended Counts VII and VIII.
VIII. Amended Count XI – Nuisance
Defendants argue Amended Count XI fails because:
Plaintiffs have not pled sufficient factual allegations to
support the claim; the Beans’ and the Moseleys’ nuisance claims
are time-barred; and Plaintiffs do not allege the Pahonas and
Plaintiffs Kenneth Lake and Crystal Lake (“the Lakes”) have been
impacted by construction dust.
21
A.
The Beans and the Moseleys
This Court has recognized that Haw. Rev. Stat. § 657–7
applies to a claim for trespass to property.8
Aana v. Pioneer
Hi–Bred Int’l, Inc., 965 F. Supp. 2d 1157, 1181 (D. Hawai`i
2013).
The Beans have not lived at MCBH since January 2012, and
the Moseleys have not lived there since November 2012.
Amended Complaint at ¶¶ 7, 9.]
[First
Thus, they did not file their
nuisance claim within two years after their exposure to
contaminated soil and/or construction dust at MCBH ceased.
Plaintiffs argue the Beans’ and the Moseleys’ nuisance claims are
timely because the statute of limitations was tolled while Barber
was pending because it was filed as a class action, and
Plaintiffs were all members of the putative class.
The United States Supreme Court has stated:
Nonnamed class members are . . . parties in
the sense that the filing of an action on behalf
of the class tolls a statute of limitations
against them. See American Pipe & Constr. Co. v.
Utah, 414 U.S. 538 (1974). Otherwise, all class
members would be forced to intervene to preserve
their claims, and one of the major goals of class
action litigation — to simplify litigation
involving a large number of class members with
similar claims — would be defeated. . . .
8
Section 657-7 states: “Actions for the recovery of
compensation for damage or injury to persons or property shall be
instituted within two years after the cause of action accrued,
and not after, except as provided in section 657-13.”
22
Devlin v. Scardelletti, 536 U.S. 1, 10 (2002); see also id. at 16
n.1 (Scalia, J., dissenting) (noting the tolling applies “between
the time the class action is filed and the time class
certification is denied”).
In Barber, the plaintiffs alleged the following claims:
breach of contract against Ohana; breach of the implied warranty
of habitability against Ohana; a claim against Defendants for
violations of Chapter 521; a UDAP claim against Defendants; a
negligent failure to warn claim against Defendants; NIED and IIED
claims against Defendants; a fraud claim against Defendants; and
a negligent misrepresentation claim against Defendants.
[Barber,
Second Amended Class Action Complaint for Damages & Injunctive
Relief, filed 1/20/15 (dkt. no. 76).9]
Because there was no
nuisance claim at issue in Barber, the Beans’ and the Moseleys’
nuisance claims were not tolled while Barber was pending.
Further, Plaintiffs have not presented any other ground that
would support tolling of the statute of limitations on the Beans’
and the Moseleys’ nuisance claims.
The Beans’ and the Moseleys’ nuisance claims are
therefore time-barred and must be dismissed.
9
Further, this Court
Neither the First Amended Class Action Complaint for
Damages & Injunctive Relief, [Barber, filed 8/29/14 (dkt. no.
25),] nor the Class Action Complaint for Damages, [id., Notice of
Removal, filed 5/6/14 (dkt. no. 1), Decl. of Christine A. Terada,
Exh. A (complaint filed in state court on 4/3/14),] alleged a
nuisance claim.
23
concludes it is clear Plaintiffs cannot cure the statute-oflimitations defect in the Beans’ and the Moseleys’ nuisance
claims by amendment.
Defendants’ Motion is granted insofar as
the Beans’ and the Moseleys’ nuisance claims are dismissed with
prejudice.
B.
Sufficiency of the Allegations
Based on the same allegations discussed regarding
Plaintiffs’ standing, this Court concludes Plaintiffs have pled
sufficient factual allegations regarding how all of the remaining
Plaintiffs – including the Pahonas and the Lakes – were exposed
to and impacted by allegedly contaminated construction dust.
The
remaining Plaintiffs have alleged sufficient factual allegations
to state plausible nuisance claims.
See generally, 8/1/17 Order,
2017 WL 4563079, at *11 (discussing requirements of a nuisance
claim).
Defendants’ Motion is denied as to the remaining
Plaintiffs’ nuisance claims in Amended Count XI.
CONCLUSION
On the basis of the foregoing, Defendants’ Motion to
Dismiss and/or Strike Plaintiffs’ First Amended Complaint [Dkt
75], filed October 4, 2017, is HEREBY GRANTED IN PART AND DENIED
IN PART.
The Motion is GRANTED insofar as: Plaintiffs’ UDAP and
UMOC claims are STRICKEN; Plaintiffs’ Haw. Rev. Stat. Chapter 521
claim alleging a violation of Haw. Rev. Stat. § 521-42(a)(1) is
DISMISSED WITH PREJUDICE; the Beans’ nuisance claim is DISMISSED
24
WITH PREJUDICE; and the Moseleys’ nuisance claim is DISMISSED
WITH PREJUDICE.
The Motion is DENIED in all other respects.
Defendants are ORDERED to file their answer(s) to the
remaining portions of the First Amended Complaint by June 29,
2018.
This Court EMPHASIZES that the filing of any motion for
reconsideration of this Order will not affect the deadline for
Defendants’ answer(s).
If a motion for reconsideration is filed
and granted, this Court will allow Defendants to amend their
answer to the First Amended Complaint, if necessary.
IT IS SO ORDERED.
DATED AT HONOLULU, HAWAII, May 31, 2018.
/s/ Leslie E. Kobayashi
Leslie E. Kobayashi
United States District Judge
KENNETH LAKE, ET AL. VS. OHANA MILITARY COMMUNITIES, LLC, ET AL;
CIVIL 16-00555 LEK-KJM; ORDER GRANTING IN PART AND DENYING IN
PART DEFENDANTS’ MOTION TO DISMISS AND/OR STRIKE PLAINTIFFS’
FIRST AMENDED COMPLAINT [DKT 75]
25
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