Westenbroek v. Kappa Kappa Gamma Fraternity

• Docket Number: 23-CV-51-ABJ
• Decision Date: 25 August 2023
• Parties: JAYLYN WESTENBROEK, HANNAH HOLTMEIER, ALLISON COGHAN, GRACE CHOATE, MADELINE RAMAR, and MEGAN KOSAR, on behalf of themselves and derivatively on behalf of KAPPA KAPPA GAMMA FRATERNITY, Plaintiffs, v. KAPPA KAPPA GAMMA FRATERNITY, an Ohio non-profit corporation, as a Nominal Defendant and as a Direct Defendant, MARY PAT ROONEY, President of the Fraternity Council of KAPPA KAPPA GAMMA FRATERNITY, in her official capacity, KAPPA KAPPA GAMMA BUILDING CO., a Wyoming non-profit corporation, and ARTEMIS LANGFORD, Defendants.
• Court: U.S. District Court — District of Wyoming

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JAYLYN WESTENBROEK, HANNAH HOLTMEIER, ALLISON COGHAN, GRACE CHOATE, MADELINE RAMAR, and MEGAN KOSAR, on behalf of themselves and derivatively on behalf of KAPPA KAPPA GAMMA FRATERNITY, Plaintiffs, v. KAPPA KAPPA GAMMA FRATERNITY, an Ohio non-profit corporation, as a Nominal Defendant and as a Direct Defendant, MARY PAT ROONEY, President of the Fraternity Council of KAPPA KAPPA GAMMA FRATERNITY, in her official capacity, KAPPA KAPPA GAMMA BUILDING CO., a Wyoming non-profit corporation, and ARTEMIS LANGFORD, Defendants.

No. 23-CV-51-ABJ

United States District Court, District of Wyoming

August 25, 2023

ORDER GRANTING DEFENDANTS' MOTION TO DISMISS (ECF NO. 19), DISMISSING, WITHOUT PREJUDICE, PLANTIFFS' FIRST AMENDED VERIFIED MEMBER DERIVA TIVE COMPLAINT FOR BREACH OF FIDUCIARY DUTIES (ECF NO. 6), AND DISMISSING AS MOOT DEFENDANT ARTEMIS LANGFORD'S MOTION TO DISMISS (ECF NO 22)

Alan B. Johnson, United States District Judge

THIS MATTER comes before the Court following Defendants' Kappa Kappa Gamma Fraternity, an Ohio non-profit corporation ("KKG", "Kappa Kappa Gamma", or "Kappa"), Mary Pat Rooney, President of the Fraternity Council of Kappa Kappa Gamma Fraternity ("Rooney"), and Kappa Kappa Gamma Building Co., a Wyoming non-profit corporation ("KKG Building Co.") (collectively, "Defendants") Motion to Dismiss, filed on June 20,2023. ECF No. 19. Pursuant to Fed.R.Civ.P. 12(b)(1), (2), and (6), Defendants move to dismiss Plaintiffs', Jaylyn Westenbroek, Hannah Holtmeier, Allison Coghan, Grace Choate, Madeline Ramar, and Megan Kosar (collectively, "Plaintiffs"), First Amended Verified Member Derivative Complaint for Breach of Fiduciary Duties ("Complaint") (ECF No. 6), due to lacking subject matter jurisdiction over KKG Building Co., lacking personal jurisdiction over Rooney, and Plaintiffs' failure to state a claim upon which relief can be granted. ECF Nos. 19, at 2; 20.

Having reviewed the filings, the applicable law, and being otherwise fully advised, the Court GRANTS Defendants' Motion to Dismiss (ECF No. 19) and DISMISSES, WITHOUT PREJUDICE, Plaintiffs' Complaint (ECF No. 6).

Separately, the Court DISMISSES AS MOOT Defendant's, Artemis Langford ("Langford"), Motion to Dismiss with Prejudice ("Langford's Motion to Dismiss") (ECF No. 22), filed on June 20, 2023.

BACKGROUND

Embittered by their chapter's admission of Artemis Langford, a transgender woman, six KKG sisters at the University of Wyoming sue their national sorority and its president. Plaintiffs, framing the case as one of first impression, ask the Court to, inter alia, void their sorority sister's admission, find that KKG's President violated her fiduciary obligations by betraying KKG's bylaws, and prevent other transgender women from joining KKG nationwide. A "woman", say Plaintiffs, is not a transgender woman. Unadorned, this case condenses to this: who decides whether Langford is a Kappa Kappa Gamma sister? Though given the opportunity to vote this past fall, not the six Plaintiffs. Not KKG's Fraternity Council. Not even this federal Court. The University of Wyoming chapter voted to admit - and, more broadly, a sorority of hundreds of thousands approved - Langford. With its inquiry beginning and ending there, the Court will not define "woman" today. The delegate of a private, voluntary organization interpreted "woman", otherwise undefined in the nonprofit's bylaws, expansively; this Judge may not invade Kappa Kappa Gamma's freedom of expressive association and inject the circumscribed definition Plaintiffs urge. Holding that Plaintiffs fail to plausibly allege their derivative, breach of contract, tortious interference, and direct claims, the Court dismisses, without prejudice, Plaintiffs' causes of action. This Court outlines the case's posture,^[1] its standard of review, and its disposition in the pages that follow.

Founded in 1870, Kappa Kappa Gamma is a non-profit organization based in Dublin, Ohio. ECF Nos. 6, ¶¶ 21, 25, 28; 6-1, at 49,55-56.^[2] Today, KKG spans 140 college campuses and boasts 210,000 living alumnae. ECF No. 6, ¶ 26. Of note are policies from KKG's national headquarters and the University of Wyoming's KKG chapter; bear with me as I summarize both. Broadly, KKG's "purposes", inter alia, are:

A. To unite women, through membership, in a close bond of friendship, seeking to instill in them a spirit of mutual love and helpfulness, to the end that each member and the Fraternity-at-large^[3] may attain social, moral, and intellectual excellence;

B. To establish chapters at various colleges and universities, provide for the proper organization, installation, and operation, with each chapter having the right and responsibility to select members of its choice in accordance with Fraternity standards and procedures[.]

ECF No. 6-1, at 52 (emphasis added). KKG has Bylaws ("bylaws"), Standing Rules^[4] and Fraternity Policies. ECF Nos. 6, ¶ 53; 6-1, at 2-30, 109-38, 140-61. While the KKG bylaws state that "[a] new member shall be a woman", no bylaw defines "woman". ECF No. 6-1, at 6.^[5]

In 2018, KKG published a Guide for Supporting our LGBTQIA+ Members ("2018 Guide").^[6] ECF Nos. 6, ¶ 5; 6-1, at 32-43. The 2018 Guide states:

Kappa Kappa Gamma is a single-gender organization comprised of women and individuals who identify as women whose governing documents do not discriminate in membership selection except by requiring good scholarship and ethical character.

Each Kappa chapter has the final choice of its own members. . . . [T]he chapter is well within its right to offer [a] potential member [who is transgender] a bid.

ECF No. 6-1, at 32, 35 (emphasis added). While KKG's bylaws do not reflect the "and individuals who identify as women" addition, accompanying documents, including KKG's Position Statements^[7] in 2021 and FAQs^[8]in 2022, both published ahead of KKG's 2022 biennial convention, do. Id. at 105 (same language supra), 183 (same); cf. Id. at 2-30, 58- 86.^[9] An Illinois resident and volunteer, Rooney heads KKG's eight-member Fraternity Council, consisting of directors and by extension staff tasked with supervising chapters nationwide. ECF Nos. 6, ¶¶ 22, 71; 26, at 3.^[10] Plaintiffs equate KKG's Fraternity Council to a corporation's board of directors. E.g., ECF No. 6, ¶ 4.

Founded in 1927, the KKG, or Gamma Omicron, chapter at the University of Wyoming ("the UW chapter") has forty-four members and an on-campus house today. ECF Nos. 6, ¶ 78; 6-1, at 200. Plaintiffs^[11] are six - some current and some graduated -chapter members and undergraduates at the University. ECF Nos. 6,¶¶ 1, 15-20; 20, at 1. Because KKG headquarters has a "live-in rule", all UW chapter members must reside within the on-campus house in Laramie, Wyoming, signing a contract with KKG Building Co.^[12] to do so. ECF No. 6-1, at 148, 165-76. Like KKG's governing documents, neither the UW chapter's Bylaws^[13] nor its Standing Rules, define "woman". Id. at 185-98, 200-09.

During fall 2022 recruitment, the UW chapter voted to admit Langford, a transgender^[14] woman. ECF No. 6, ¶ 116. Per KKG protocol, Langford was subsequently approved by KKG headquarters prior to her initiation to the chapter. Id., ¶¶ 68, 139, 141; ECF No. 6-1, at 120.

Following Langford's admission, Plaintiffs accuse Langford^[15] of salacious impropriety at the chapter house and elsewhere.^[16]

Plaintiffs' four claims include: (1) a derivative^[17] cause of action, pursuant to Ohio Rev. Code Ann. § 1702.12(I)(1)(c),^[18] against Rooney (ECF No. 6, ¶¶ 159-67) ("Count I"); (2) breach of contract against KKG and KKG Building Co. (id., ¶¶ 168-72) ("Count II"); (3) tortious interference with a contract against KKG (id, ¶¶ 173-75) ("Count III"); and (4) a direct^[19] cause of action against KKG and Rooney (id, ¶¶ 176-79) ("Count IV"). Plaintiffs request three declaratory judgments from this Court, ordering: (1) that Langford is ineligible for KKG membership and voiding, ab initio, her admission; (2) Defendants' violation of their obligations to KKG by admitting Langford; and (3) Defendants' violation of Plaintiffs' housing contracts. Id. at 70. Plaintiffs also seek preliminary and permanent injunctive relief preventing Defendants from "seeking or encouraging" transgender women to join KKG, damages, and attorneys' fees and costs. Id.^[20]

STANDARD OF REVIEW

Defendants challenge Plaintiffs' Complaint on three bases - and three Federal Rules of Civil Procedure. I begin with a dose of procedural background; federal courts are courts of limited jurisdiction. See Kokkonen v. Guardian Life Ins Co. of Am., 511 U.S. 375, 377 (1994). Accordingly federal courts are presumed to lack jurisdiction "unless and until a plaintiff pleads sufficient facts to establish it." See Celli v. Shoell, 40 F.3d 324, 327 (10th Cir. 1994) (internal citation omitted). If jurisdiction is challenged, the party asserting jurisdiction must demonstrate its existence by a preponderance of the evidence. See Id. First, when considering a Fed.R.Civ.P. 12(b)(1) challenge to subject matter jurisdiction and the movant challenges the allegations set forth in the complaint, the Court must accept those allegations as true. See Holt v. United States, 46F.3d 1000, 1002-03 (10th Cir. 1995), abrogated on other grounds by Cent. Green Co. v. United States, 531 U.S. 425, 437 (2001). Second, Plaintiffs bear the burden of establishing personal jurisdiction. See Far W. Cap., Inc. v. Towne, 46 F.3d 1071, 1075 (10th Cir. 1995). If, however, the Court resolves the pending motion on the basis of their Complaint, Plaintiffs need only make a prima-facie showing of personal jurisdiction. See OMI Holdings, Inc. v. Royal Ins. Co. of Canada, 149 F.3d 1086, 1091 (10th Cir. 1998). Plaintiffs can make such a showing by alleging, "via affidavit or other written materials,...