Hawai`I Disability Rights Center v. Cheung
| Decision Date | 01 October 2007 |
| Docket Number | CV. No. 06-00605 DAE-BMK. |
| Citation | 513 F.Supp.2d 1185 |
| Parties | HAWAI`I DISABILITY RIGHTS CENTER, a Hawaii Corporation, Plaintiff, v. Susanna F. CHEUNG, in her capacity as President and Chief Executive Officer of Opportunities for the Retarded, Inc.; and Opportunities for the Retarded, Inc., a Hawaii corporation, Defendants. |
| Court | U.S. District Court — District of Hawaii |
Lissa D. Shults, Bradley R. Tamm, Shults & Tamm, LLP, Honolulu, HI, for Plaintiff.
John T. Komeiji, Karen Y. Arikawa, Watanabe Ing & Komeiji LLP, Honolulu, HI, Todd Boley, Erickson, Beasley & Hewitt LLP, Oakland, CA, for Defendants.
ORDER DENYING DEFENDANTS' MOTION TO DISMISS
On September 24, 2007, the Court heard Defendants Susanna F. Cheung ("Cheung") and Opportunities for the Retarded Inc.'s ("ORI") Motion to Dismiss.1 Bradley Tamm, Esq., Lissa Schults, Esq., and Peter Olson, Esq., appeared at the hearing on behalf of Plaintiff; Todd Boley, Esq., and John Komeiji, Esq., appeared at the hearing on behalf of Defendants. After reviewing Defendants' Motion and the supporting and opposing memoranda, the Court DENIES Defendants' Motion to Dismiss.
On November 9, 2006, Plaintiff Hawaii Disability Rights Center ("Plaintiff') filed a Complaint for Declaratory and Injunctive Relief against Defendants Cheung and ORI (collectively, "Defendants"). According to the Complaint, Plaintiff is a Hawaii corporation that is the State of Hawaii's ("State") designated protection and advocacy agency ("P & A Agency"). (Complaint ¶ 9.) ORI is a Hawaii corporation that is a provider of adult day programs, educational, residential, and vocational services to individuals with developmental disabilities. It operates various subdivisions, including Helemano Village, a residential facility for persons with developmental disabilities, and it is a provider of Home and Community Based Services in the State. (Id. ¶ 12.) Cheung is the President and Chief Executive Officer of ORI, who is responsible for the management of the corporation and its subdivisions and for ensuring full compliance with state and federal law. (Id. ¶ 10.)
The following factual allegations are contained in Plaintiff's Complaint. On August 25, 2005, before Plaintiff filed the instant Complaint, Plaintiff filed a Complaint for Declaratory Relief, alleging violations of the Developmental Disabilities Assistance and Bill of Rights Act ("Developmental Disabilities Act" or "the Act"), 42 U.S.C. 15001 et seq., and Hawaii Revised Statutes ("Haw.Rev.Stat.") § 333F-8.5, which this Court dismissed with prejudice on June 5, 2006, according to a proposed settlement. See HDRC v. Cheung, et al., CV NO. 05-00557 DAE-LEK. The Court, however, retained jurisdiction to reopen the proceeding within 30 days of the dismissal, upon a showing of good cause, if the proposed settlement conditions were not satisfied. (Docket No. 34.) Two days later, the parties entered into a Settlement Agreement ("Agreement"), whereby ORI agreed to provide Plaintiff access to its facilities, records, and clients pursuant to certain terms and conditions attached to the Agreement. (Complaint ¶ 18.)
On or about August 24, 2006, Plaintiff received a complaint detailing allegations of system-wide and individual abuses and neglect to which ORI purportedly subjected its clients. (Id. ¶ 20.) Those allegations include "mismanagement of client funds, theft, fraud, misapplication of medications, verbal abuse of clients, and concealment of records and files of clients from Plaintiff's regular monitoring activities." (Id.) Based on that complaint, four days later, Plaintiff provided written notice to ORI, by and through Cheung, that it had received the complaint. (Id. ¶ 21.) In that letter, Plaintiff made a request to review the records of each of ORI's clients. (Id.) To do so, Plaintiff requested that Defendants provide it with the names and addresses of all legal guardians, conservators, and legal representatives of clients to whom ORI provided services so that it could access the records and investigate the alleged abuses and neglect. ORI, by and through Cheung, denied that request. (Id. ¶ 22.) Plaintiff sent three separate letters thereafter, all dated in September 2006, informing ORI of its obligations under the Developmental Disabilities Act. ORI, by and through Cheung, refused each request. (Id. ¶ 24.)
Based on those refusals, Plaintiff brought the instant cause of action pursuant to the Developmental Disabilities Act, 42 U.S.C. § 15043, and its supporting regulations, 45 C.F.R. § 1386.22, to compel Defendants to comply with its requests. Plaintiff also brought a claim for breach of the terms of the Agreement, which claim is not before the Court at this time. After partial discovery, Plaintiff moved to compel an answer to an interrogatory request, namely, interrogatory number 2 requesting information pertaining to the names and addresses of the legal guardians, conservators, and legal representatives of clients. On July 13, 2007, Magistrate Judge Leslie E. Kobayashi ("Magistrate Judge") issued an Order Granting in Part and Denying in Part Plaintiff's Motion to Compel ("Order to Compel"), in which she ordered Defendants to respond to Plaintiff's interrogatory request no later than August 17, 2007. Meanwhile, on July 18, 2007, Defendants filed the instant Motion to Dismiss the entire complaint for lack of a private right of action in federal court under the Developmental Disabilities Act, raising an issue of first impression.
On July 26, 2007, Defendants filed a Motion for Order Staying Enforcement of Magistrate's Order Compelling Discovery ("Motion to Stay") until the Court determined the jurisdictional issue, arguing that immediate release of the requested information could result in the disclosure of confidential information and, thus, irreparable harm. Thereafter, on August 7, 2007, the Magistrate Judge issued a protective order to control the use, release, and dissemination of the information, including "the names and addresses of all legal guardians, conservators, and legal representatives of all persons with disabilities," thereby protecting any confidential information. Based on the protective order, the Court issued an Order denying Defendants' Motion for Stay ("Order Denying Stay") on the ground that the protective order negated the sole concern of confidentiality at issue and, thus, Defendants could not prove irreparable harm. Defendants then filed a Motion for Reconsideration of the Order Denying Stay on the ground that the Court did not have jurisdiction to make that decision. The Court denied the Motion for Reconsideration on the basis that it had authority to decide nondispositive matters, such as those concerning discovery, without first deciding jurisdiction. Nonetheless, the Court held off on deciding two, additional pending matters until it determined jurisdiction: (1) objections to the Magistrate Judge's findings and recommendation, and (2) Defendants' appeal of the Magistrate Judge's Order to Compel.
On September 5, 2007, Plaintiff opposed the Motion to Dismiss, and, on September 13, 2007, Defendants filed a reply. During the hearing on the motion, Plaintiff raised a new argument, to be discussed herein, that was not raised in its opposition. Because Plaintiff had not briefed the new argument, the Court gave the parties until September 28, 2007 to submit supplemental briefing on the matter. On September 28, 2007, both parties filed supplemental memoranda to address that argument.
Defendants bring the instant motion pursuant to Federal Rules of Civil Procedure ("Fed. R. Civ.P.") 12(b)(1) for lack of subject matter jurisdiction and Fed. R.Civ.P. 12(b)(6) for failure to state a claim. The Court has noted that "there is no controlling appellate authority regarding whether Rule 12(b)(1) or Rule 12(b)(6) governs" in a case involving the absence of a private right of action. Hawaii Motor Sports Center v. Babbitt, 125 F.Supp.2d 1041, 1046 n. 2 (D.Haw.2000) (). Defendants, in essence, assert that Plaintiff may not sustain its cause of action in federal court under the Developmental Disabilities Act for lack of a federal right of action, but only in state court under the State's implementing statute, thus depriving the Court of its jurisdiction over the subject matter. The Court, therefore, will address the instant claim under Fed.R.Civ.P. 12(b)(1) as a motion to dismiss for lack of subject matter jurisdiction.
In a motion to dismiss for lack of subject matter jurisdiction, the plaintiff bears the initial burden of proving that subject matter jurisdiction exists. Prescott v. United States, 973 F.2d 696, 701 (9th Cir.1992). In other words, there is a presumption against jurisdiction unless the plaintiff proves otherwise. See Stock West, Inc. v. Confederated Tribes of the Colville Reservation, 873 F.2d 1221, 1225 (9th Cir.1989). A Fed.R.Civ.P. 12(b)(1) motion "for lack of subject matter jurisdiction may either attack the allegations of the complaint or may be made as a `speaking motion' attacking the existence of subject matter jurisdiction in fact." Thornhill Publ'g Co., Inc. v. Gen. Tel. & Elecs. Corp., 594 F.2d 730, 733 (9th Cir.1979). A facial. attack occurs when the movant "asserts that the allegations contained in a complaint are insufficient on their face to invoke federal jurisdiction." Safe Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir.2004). "By contrast, in a factual attack, the challenger disputes the truth of the allegations that, by themselves, would otherwise invoke federal jurisdiction." Id.
Because Defendants argue that the allegations, on their face, are insufficient to invoke federal jurisdiction, regardless of the factual basis, the Court construes the instant arguments as a facial attack. In resolving a facial...
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