Harding v. US Figure Skating Ass'n, CV No. 94-238-PA.

• Decision Date: 03 May 1994
• Docket Number: CV No. 94-238-PA.
• Citation: 851 F. Supp. 1476
• Parties: Tonya HARDING, Plaintiff, v. UNITED STATES FIGURE SKATING ASSOCIATION, a Colorado non-profit corporation, Defendant. Oregonian Publishing Co., Third Party Intervenor.
• Court: U.S. District Court — District of Oregon

851 F. Supp. 1476

Tonya HARDING, Plaintiff, v. UNITED STATES FIGURE SKATING ASSOCIATION, a Colorado non-profit corporation, Defendant Oregonian Publishing Co., Third Party Intervenor.

CV No. 94-238-PA.

United States District Court, D. Oregon.

May 3, 1994.

COPYRIGHT MATERIAL OMITTED

Don H. Marmaduke, Tonkon, Torp, Galen, Marmaduke & Booth, Robert C. Weaver, Jr., Garvey, Schubert & Barer, Portland, OR, for plaintiff.

Thomas M. James, Holme, Roberts & Owen, L.L.C., Christopher Cipoletti, Hall & Evans, L.L.C., Colorado Springs, CO, Stephen F. English, Bullivant, Houser, Bailey, Pendergrass & Hoffman, Portland, OR, for U.S. Figure Skating Ass'n.

Charles F. Hinkle, Stoel, Rives, Boley, Jones & Grey, Portland, OR, for Oregonian Pub. Co.

OPINION

PANNER, District Judge.

Plaintiff Tonya Harding brought this diversity action for breach of contract against defendant United States Figure Skating Association, Inc. I enjoined defendant from holding a planned disciplinary hearing in Colorado on March 10, 1994. When the parties were unable to agree upon a new date for the disciplinary hearing, I extended that injunction to preclude defendant from holding the hearing prior to June 27, 1994. Defendant has now moved for reconsideration of my earlier ruling along with a motion to dismiss this action.¹ I grant both motions, though not for the reasons urged by defendant.

DISCUSSION

Defendant's memorandums exhibit some confusion as to the basis for my earlier decision. At the time this action was filed, plaintiff was a member of the defendant United States Figure Skating Association. Plaintiff paid her dues, and agreed to comply with the rules of that association. The parties mutually agreed to certain rules that would govern any disciplinary proceeding against a member of the association.

Defendant's bylaws provide that when disciplinary charges are filed against a member, that member has thirty days to file a reply. The bylaws further provide that "upon receipt of the reply, the Hearing Panel shall set a place and date for a hearing that is reasonably convenient for all parties." Article XXVII, § 3(c)(iv). Defendant violated this rule by unilaterally setting a time and date for the hearing that was just three days after the reply was due. Defendant acted contrary to its bylaws by setting the date before it received the reply. Furthermore, in view of the complexity of the charges, March 10 was not a date "reasonably convenient for all parties."

I reviewed in camera the evidence defendant intended to present at the disciplinary hearing. The evidence was complex, involving the actions of several dozen individuals over a period of weeks. The evidence included statements by alleged co-conspirators, each of whom may have had a motive to misrepresent plaintiff's role in this matter. Moreover, because the Rules of Evidence do not apply at this disciplinary hearing, the documents defendant proposed to use were replete with hearsay, newspaper clippings, conclusions, an anonymous letter, forensic opinions, affidavits, media interviews, and similar items that would not be admissible in a court of law. In addition, it was intimated that plaintiff's defense might include a form of the "battered wife" defense, which would require extensive investigation by experts and interviews with persons who have known plaintiff and her former husband over a period of many years. Finally, the Hearing Panel that would decide the charges against plaintiff was the same panel that acted as a de facto grand jury in the decision to file charges against plaintiff in the first place. Based on my fourteen years of experience as a trial judge, and thirty years of experience as a trial lawyer before taking the bench, it was immediately apparent that plaintiff could not possibly prepare a defense to those charge in the time allotted. The hearing date established by defendant was not "reasonably convenient for all parties," as required by defendant's bylaws.

When one party to a contract is given discretion in the performance of some aspect of the contract, that discretion must be exercised in good faith. See, e.g., Best v. U.S. National Bank, 303 Or. 557, 739 P.2d 554 (1987). Colorado, where defendant is incorporated, recently adopted a similar view. Wells Fargo Realty Advisors Funding, Inc. v. Uioli, Inc., 872 P.2d 1359 (Colo.App.1994) (appeal pending). The date set by defendant was arbitrary and manifestly unreasonable, and would severely prejudice plaintiff's chances of obtaining a fair hearing. Plaintiff immediately advised defendant that this date was not convenient and requested an extension of time. Defendant denied the request because it wanted to conduct the hearing prior to the World Championships so it could remove plaintiff from the United States delegation for that event. Plaintiff then exhausted her internal appeals within the association before filing this action for injunctive relief.

The courts should rightly hesitate before intervening in disciplinary hearings held by private associations, including the defendant United States Figure Skating Association. Intervention is appropriate only in the most extraordinary circumstances, where the association has clearly breached its own rules, that breach will imminently result in serious and irreparable harm to the plaintiff, and the plaintiff has exhausted all internal remedies. Even then, injunctive relief is limited to correcting the breach of the rules. The court should not intervene in the merits of the underlying dispute.

This is one of those rare cases where judicial intervention was appropriate. It appeared at the time that had defendant not been enjoined from holding the hearing on March 10, plaintiff would have suffered serious irreparable harm. Defendant argued that the matter was not ripe because the outcome of the hearing was unknown. If the only issue was whether plaintiff should have been allowed to skate in the World Championships in Japan later that month, defendant's point might have been well taken, since injunctive relief could still be sought at the conclusion of the disciplinary hearing. In this particular case, however, merely holding the hearing on March 10 would have caused plaintiff to suffer irreparable harm. In order to maintain her right to contest the decision of the Hearing Panel, plaintiff would have been obliged to appear before the panel and prematurely present her defense without having adequate time to prepare for that hearing. If the Hearing Panel found her guilty as charged, the resultant publicity could have severely prejudiced her chances for a fair trial in any future criminal case. Plaintiff would also have been obliged to decide upon and publicly disclose a defense strategy for both the civil and criminal matters before she had time to conduct full discovery and interview witnesses. Finally, the entire testimony, including information that has heretofore not been made public, would inevitably have been leaked to the media, despite defendant's best intentions to maintain the confidentiality of the proceedings, thereby further poisoning plaintiff's chance of obtaining a fair trial in the criminal proceeding. Under the circumstances, plaintiff's attorneys might well have advised their client not to attend the hearing. In that case, plaintiff would likely have forfeited any right to contest the results of the hearing. Her failure to contest the charges would have also resulted in her being found guilty in the court of public opinion.

I rejected plaintiff's suggestion that the disciplinary hearing be postponed until after resolution of the criminal charges against her. Defendant is a private association, not a governmental body. San Francisco Arts & Athletics, Inc. v. United States Olympic Committee, 483 U.S. 522, 543-45, 107 S.Ct. 2971, 2984-86, 97 L.Ed.2d 427 (1987). Plaintiff's constitutional right against self-incrimination is not implicated unless she is compelled to testify either before or by a governmental body.

I nonetheless concluded that plaintiff was entitled to additional time to prepare for the hearing. The harm to plaintiff greatly outweighed the harm to defendant from postponing the hearing. Defendant has an interest in enforcing its rules and promptly disciplining violators, and ensuring that only qualified skaters represent the United States at the World Championships. However, the United States Olympic Committee ("USOC") charter requires that resolution of disputes be both swift and equitable. 36 U.S.C. § 382b. In this case, equity was sacrificed for speed. Plaintiff exhausted all her internal remedies before filing suit. Defendant's bylaws provide for...