Barnett v. E: Space Labs LLC et al

Filing 22

Opinion and Order: Plaintiffs Motion for leave to exceed page limits 21 is granted. Because Plaintiff fails to state claims upon which relief may be granted, Defendants Motion to dismiss 13 is granted. Because the legal deficiencies of the claims cannot be cured through amending the complaint, case is dismissed with prejudice. Signed on 7/10/2018 by Judge Michael J. McShane. (cp)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON
KELLY A. BARNETT,
Plaintiff,
v.

Case. No. 6:18-cv-00419-MC
OPINION AND ORDER

E:SPACE LABS LLC., at al,
Defendants.
_____________________________
MCSHANE, Judge:
Defendant E:Space Labs, LLC moves to dismiss Plaintiff’s complaint pursuant to Fed. R.
Civ. P. 12(b)(6) for failure to state a claim. Plaintiff Ms. Barnett, proceeding pro se, alleges
fourteen claims based on (1) an alleged theft of Plaintiff’s computers and portable devices by an
unknown person or persons not party to this suit, and (2) an alleged attempt to illicitly learn
Plaintiff’s trade secrets by one of the individually named defendants. Because the amended
complaint fails to state a claim upon which relief may be granted, this Court GRANTS the
defendants’ motions to dismiss.
1 – OPINION AND ORDER

BACKGROUND
A. Parties
E:Space Labs is a membership-based technology incubator dedicated to the advancement
of the high tech electronic hardware device industry in Central Oregon. Compl. ¶ 5. To use their
facilities, companies or individuals may contract directly with E:Space Labs, or apply to become
an E:Space member. In addition, the Company has offered classes and workshops in the past as
part of their goal to facilitate development of the electronic hardware industry. Id.; Def.’s Mot. 23, ECF No. 13.
E:Space Lab’s physical offices and facilities are located within a business complex
known as “The Bridge” in Bend, Oregon. Compl. ¶ 5. E:Space Labs does not own The Bridge,
but is one of several tenants. Id. ¶¶ 32, 36, 37 and 42. E:Space Labs leases office space over
which they have exclusive access and control. Additionally, The Bridge also provides common
spaces, such as a lounge and conference rooms, that are accessible to all tenants in the building.
Compl. at pg. 15 (Section “IV. Relief,” ¶ 3).
The plaintiff, Ms. Barnett, had been permitted to utilize E:Space Labs facilities for about
three year until E:Space Labs revoked her access in December of 2017. Compl. ¶¶ 30, 35.
E:Space Labs revoked Plaintiff’s access after receiving complaints from other tenants of The
Bridge that Plaintiff was making them feel uncomfortable and unsafe, and had been carrying a
weapon on the premises. Id. ¶¶ 39, 57.
In January 2018, Plaintiff filed a complaint with Oregon’s Bureau of Labor and Industries
(BOLI). BOLI dismissed the complaint on March 1, 2018, citing lack of evidence. This lawsuit
subsequent ensued.
B. Complaint

2 – OPINION AND ORDER

Plaintiff’s pro se complaint generally brings five types of claims: (1) negligence claims;
(2) public accommodation claims; (3) misappropriation claims; (4) defamation claims; and
finally (5) miscellaneous claims. These claims contain several causes of action located
throughout the complaint:
Type of claim

The “Misappropriation
Claims”
The
“Defamation Claim”
The
“Miscellaneous Claims”

Location in
Complaint
Page 4
Page 4
Page 8
Page 8
Page 12
Page 12
Page 4
Page 4
Page 12

Conspiracy
US Constitution First Amendment
Oregon Constitution “free expression”

Page 4
Page 8
Page 8 (see
also ¶46)

Oregon Constitution “victims’ rights”

The
“Negligence Claims”
The “Public
Accommodation
Claims”

Purported Causes of Action
(used in Plaintiff’s Complaint)
Theft by Negligence
Failure to Defend Trade Secrets
Public Accommodation
Civil Rights
Unequal Treatment
Discrimination
Misappropriation of Trade Secrets
Failure to Defend Trade Secrets2
Defamation

Page 8 (see
also ¶46)
Page 8

Retaliation

Factually, the complaint alleges that on March 10, 2016, Plaintiff brought into E:Space
Labs her two laptops and other portable drives for back-up and system upgrades. Compl. ¶ 10.
The next day, at the request of Defendant David Robson, Plaintiff moved her computers and
portable drives to a conference room that is one of The Bridge’s common spaces. Id. ¶ 11.
Plaintiff left the computers and portable devices in the conference room overnight unattended.
Id. ¶ 12. The following morning, she discovered “a physical loss of her computers, back-up
drives, written patent drafts and handwritten continuation patent claim set.” Id. ¶ 15. The
computers contained data from clinical trials, survivability case studies and animal care and use

3 – OPINION AND ORDER

records along with personal records. Id. Plaintiff contacted the Bend Police Department who
arrived and conducted an investigation. Id.
21 months later, on December 13, 2017, Plaintiff obtained a stalking order against
another E:Space Labs member, defendant Joshua Hill. Plaintiff accuses Mr. Hill of attempting to
illicitly learn Plaintiff’s trade secrets from September 2017 through December 11, 2017, and that
Mr. Hill had been “caught trespassing, invading personal space, stealing farm equipment for joy
rides causing nuisance and damage, harrying research animals leading to injury to the Plaintiff
and searching the Plaintiff’s premise on more than one occasion.” Compl. ¶ 17.
On December 14, 2017 Plaintiff presented a copy of the stalking order to defendant
David Robson, a manager of E:Space Labs. Compl. ¶ 26. Three days later, on December 17, Mr.
Robson emailed Ms. Barnett asking her to turn in her building key. Id. 30. On December 19,
Plaintiff received notification that she was not to enter The Bridge, to include the parking lot and
all businesses located in the complex. Id. ¶¶ 34-35. During this time, defendant Mr. Hill
continued to have unrestricted access to the E:Space Labs’ facilities. Id. ¶ 56.
STANDARD OF REVIEW
To survive a motion to dismiss under Fed. R. Civ. P. 12(b)(6), a complaint must contain
sufficient factual matter that “state[s] a claim to relief that is plausible on its face.” Bell Atlantic
Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim is plausible on its face when the factual
allegations allow the court to infer the defendant’s liability based on the alleged conduct.
Ashcroft v. Iqbal, 556 U.S. 662, 663 (2009). The factual allegations must present more than “the
mere possibility of misconduct.” Id. at 678.
When considering a motion to dismiss, the court must accept all allegations of material
fact as true and construe those facts in the light most favorable to the non-movant, Burget v.

4 – OPINION AND ORDER

Lokelani Bernice Pauahi Bishop Trust, 200 F.3d 661, 663 (9th Cir. 2000), but the court is “not
bound to accept as true a legal conclusion couched as a factual allegation,” Twombly, 550 U.S. at
555. If the complaint is dismissed, leave to amend should be granted unless the court
“determines that the pleading could not possibly be cured by the allegation of other facts.” Doe v.
United States, 58 F.3d 494, 497 (9th Cir. 1995).
DISCUSSION
A. Negligence claims
The stated allegations of negligence rely on a theory that defendants had a duty of care
towards the plaintiff for which they breached. See Compl. ¶¶ 6, 19; “IV. Relief” ¶ 3. Where a
plaintiff purports to identify a legally cognizable duty, that duty must be the standard for the
specific tort alleged. Collier v. Bidleman, 98 Or. App. 556, 559-60 (1989). In addition, there
must be a recognized relationship between the parties which imposes a duty upon the defendant
to prevent the harm allegedly suffered by the plaintiff. See, e.g. Nofziger v. Kentucky Cent. Life
Ins. Co., 91 Or. App. 633, 640 (1988) (contract and agency relationship with insurance agent did
not impose duty on agent to procure life insurance coverage for deceased person). Whether a
plaintiff has alleged a specific duty based on the relationship or status of the parties is a question
of law for this Court. SFG Income Fund, L.P. v. May, 189 Or. App. 269, 275 (2003).
Here, Plaintiff cites ORS 63.155(1)(3) as the statutory authority that creates a fiduciary
duty owed her by defendants. Compl. pg. 3 (“basis for jurisdiction”). However, this statute does
not apply to the type of relationship allegedly enjoyed between Ms. Barnett and the defendants.
Rather, ORS 63.001 et seq. concerns the relationship between members and managers in a
limited liability corporation with multiple owners. Because the Plaintiff does not allege to be or

5 – OPINION AND ORDER

to have been an owner of E:Space Labs, subject to ORS 63.155(1)(3), this statue does not
establish a duty of care between Plaintiff and the defendants.
Plaintiff also alleges that E:Space Labs “has a heightened duty of care as intellectual
property and trade secrets are routinely confidentially disclosed and worked on by members of
ESpace Labs.” Compl. ¶ 6. The sharing of intellectual property alone does not impose a duty on
a defendant. There is, in general, no common law duty to protect the confidential information of
others. See, e.g. USAA Fed. Savings Bank v. PLS Fin. Serv., Inc., 260 F. Supp. 3d 965, 969-70
(N.D. Ill. 2017), see also Loosli v. City of Salem, 345 Or. 303, 312 n. 9 (2008) (Where a
defendant allegedly provides information gratuitously, it owes no duty to exercise reasonable
care in providing that information.) Because the sharing of confidential information does not
impose a duty, Plaintiff has not alleged a legally cognizable duty to protect any confidential
information.
Here, the nature of the parties’ relationship is found in Ms. Barnett’s permitted access and
use of E:Space Labs’ facilities, and the subsequent revocation of that permission. Compl. ¶¶ 30
35. Because that kind of relationship does not create the kind of legally cognizable duty
necessary for sustaining the negligence claims, those claims are dismissed.
B. Misappropriation claims
Misappropriation of trade secrets is a violation of the federal Defend Trade Secrets Act,
18 U.S.C. § 1836 et seq. To constitute a trade secret, there must be some form of proprietary
information with the owner having taken reasonable measures to keep such information secret.
Id.
Here the complaint does not allege that the defendants stole or misappropriated trade
secrets. The first allegation is that Plaintiff left her computers and portable devices overnight in a

6 – OPINION AND ORDER

conference room not under Defendants’ control and that those computers and devices were
stolen from some unknown person or persons. The second allegation is that Joshua Hill
attempted to illicitly learn Plaintiff’s trade secrets. There is no allegation that Mr. Hill acted on
behalf of E:Space Labs or other individually-named defendants. Because there is no allegation
that defendants actually misappropriated trade secrets, those allegations fail to state a claim
under Fed. R. Civ. P. 12(b).
Additionally, while the complaint imputes responsibility for the theft of the computers
and portable devices onto the named defendants, no such legal duty exists. The Defend Trade
Secrets Act of 2016 does not create a duty for third-parties to defend or protect trade secrets.
Because a person cannot be held liable for the allegedly misappropriation of trade secrets by
another, the misappropriation claims fail as a matter of law.
C. Public Accommodation claims
Oregon law prohibits discrimination on the basis of race, color, religion, sex, sexual
orientation, national origin, marital status, or age in “places of public accommodation.” ORS §
659A.403. Public accommodation is defined as “any place or service offering to the public
accommodations, advantages, facilities, or privileges whether in the nature of goods, services,
lodgings, amusements, transportation, or otherwise” if they are owned by non-public entities.
ORS § 659A.400(1)(a).
To determine whether a place is in the nature of a public accommodation, Oregon courts
apply a two-step inquiry. Vejo v. Portland Public Schools, 204 F. Supp. 3d 1149, 1167 (2016).
The courts first ask whether the entity is a business or commercial enterprise, and secondly, if so,
whether the entity’s “membership policies are so unselective that the organization can fairly be

7 – OPINION AND ORDER

said to offer its services to the public.” Lahmann v. Grand Aerie of Fraternal Order of Eagles,
202 Or. App. 123, 127 (2005).
Defendants concede as to the first question. E:Space Labs is a business or commercial
enterprise, because it sells its services and use of its facilities to businesses and members. The
second question, however, is answered in the negative; it cannot be said that E:Space Lab’s
membership policies are so unselective, or unrestrictive, that the organization can be said to offer
its services to the “public.” Parsons v. Henry, 65 Or. App. 627, 633 (1983) (A custom home
builder, who contracts after a bid process or negotiation, who does not advertise his services to
the general public, cannot be said to have “offered his services to the public.”)
On the face of the complaint, E:Space Labs’ membership is restricted and the facilities
are not open to the public. E:Space Labs is a “membership-based technology incubator.” Compl.
¶ 5. Members are issued keys to access the facilities. Compl. ¶ 30. E:Space Labs grants
permission to use its facilities on a selective basis, and has exercised its discretion to revoke
permission. Because E:Space Labs is not a “place of public accommodation,” a claim under that
theory cannot be sustained.
D. Defamation claim
The elements of a defamation claim in Oregon are (1) the making of a defamatory and
false statement; (2) publication of the defamatory material; and (3) a resulting special harm,
unless the statement is defamatory per se. Nat’l Union Fire Ins. Co. of Pittsburgh v. Starplex
Corp., 220 Or. App. 560, 584 (2008). Here, the complaint fails to allege that a false statement
was made. Schliske v. Albany Police Dep’t, 617 F. Supp. 2d 1106, 1114 (D. Or. 2009) (To be
actionable, a statement must be both defamatory and false.) Additionally, statements made by
defendants to the Plaintiff are not actionable. See Wallulis v. Dymowski, 323 Or. 337, 343 (1996)

8 – OPINION AND ORDER

(To be published, a defamatory statement must have been heard or read by someone other than
the person who uttered the defamation or the person being defamed.) The defamation claim is
dismissed.
E. Miscellaneous claims
The remaining miscellaneous claims are comprised of the following: (1) conspiracy; (2)
U.S. Constitution First Amendment; (3) Oregon Constitution “free expression”; (4) Oregon
Constitution “victims’ right”; and (5) retaliation.
On a claim for conspiracy, the complaint references ORS 161.085 and 161.450 (Compl.
pg. 3) which are part of Oregon’s criminal code. Because conspiracy is a criminal charge, there
is no private right of action.
The First Amendment of the U.S. Constitution and Section 8 of the Bill of Rights in the
Oregon Constitution protect freedom of speech from government action, not from the action of
private actors. Because defendants are not government actors, there is no claim for relief under
these constitutional provisions.
The Oregon Constitution provides for “victims’ right” during criminal prosecution, not
civil litigation. See Oregon Constitution, Art. I, Sec. 42, “Rights of victims in criminal
prosecutions and juvenile court delinquency proceedings,” and also, Article I. Sec. 43 “Rights of
victim and public to protection from accused person during criminal proceedings; denial of
pretrial release.” This legal theory of claim does not apply in this case.
The complaint does not provide a legal source for a retaliation claim. Plaintiff was not a
member of a protected group of people, such as an employee.
F. Plaintiff’s Response to the motion to dismiss

9 – OPINION AND ORDER

Plaintiff filed a fifty-nine page Response to Defendants’ Motion to Dismiss. Memoranda
filed with this Court may not exceed 11,000 words or thirty-five pages. L.R. 7-2(b). Plaintiff,
operating pro se, was unaware of the word and page limit, and subsequently filed a Motion for
Leave to exceed page limits (ECF No. 21). The legal issues and facts in the case are straightforward so as to not necessitate the extra briefing. Good reason has not been shown why the
extra pages are necessary. Nonetheless, the Court has read and considered Plaintiff’s entire
response.
Plaintiff’s Response asserts facts and allegations that are not found in her Amended
Complaint. Defendants rightly ask that this Court disregard the extraneous facts and allegations
found in the Response. On a Rule 12(b)(6) motion to dismiss, the scope of review is generally
limited to the allegations in the complaint. See City of Portland v. HomeAway.com, Inc., 240 F.
Supp. 3d 1099, 1111 (D. Or. 2017). The extraneous facts and allegations in Plaintiff’s Response
are not persuasive, and in either course, the Court will not consider allegations outside the
amended complaint.
CONCLUSION
Plaintiff’s Motion for leave to exceed page limits (ECF No. 21) is GRANTED. Because
Plaintiff fails to state claims upon which relief may be granted, Defendant’s Motion to dismiss
(ECF No. 13) is GRANTED. Because the legal deficiencies of the claims cannot be cured
through amending the complaint, case is dismissed with prejudice.
IT IS SO ORDERED.
DATED this 10th day of July, 2018.
______/s/ Michael McShane_______
Michael McShane
United States District Judge

10 – OPINION AND ORDER