Kimiko P. v. Alta Cal. Reg'l Ctr.

KIMIKO P., a conserved adult; by and through her conservators MARIKO PESHON MCGARRY,RANDOLPH PESHON, and TERESA PESHON, Plaintiff, v. ALTA CALIFORNIA REGIONAL CENTER,ON MY OWN INDEPENDENT LIVING SERVICES, INC. and PLACER ARC, Defendants.

No. 2:19-cv-0068-KJM-CKD

UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF CALIFORNIA

October 19, 2020

ORDER

This matter is before the court on two separate motions to dismiss. Plaintiff, Kimiko P., a conserved adult with autism, filed this suit through her conservators Mariko Peshon McGarry, Randolph Peshon and Teresa Peshon against defendants Alta California Regional Center, On My Own Independent Living Services, Inc. and Placer ARC (collectively "defendants") for lack of supervision leading to plaintiff's sexual exploitation. Having considered defendant Placer ARC's and defendant Alta California Regional Center's motions to dismiss plaintiff's second amended complaint the court GRANTS both motions to dismiss for the following reasons. Granting the motions moots defendants' impleader motion.

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I. BACKGROUND

In her second amended complaint ("SAC"), plaintiff alleges five causes of action against defendants: (1) violation of the Rehabilitation Act of 1973, § 504; (2) retaliation under § 504; (3) negligent supervision; (4) general negligence and (5) violation of the California Unruh Civil Rights Act, Cal. Civ. Code section 51. See generally SAC, ECF No. 36.

A. Defendant Placer ARC

The court set forth the relevant facts in its order on defendant Placer ARC's first motion to dismiss and incorporates them by reference here. First Mot. to Dismiss ("MTD") Order, ECF No. 35.

In that order, the court dismissed plaintiff's § 504 claims under the Rehabilitation Act against Placer ARC for failure to allege facts sufficient to suggest Placer ARC received a federal subsidy. MTD Order at 5. In its order, the court explained that the facts alleged in the first amended complaint showed Placer ARC is not the type of entity subject to the Rehabilitation Act. Id. The court recognized that granting leave to amend to supplement these facts "would likely be futile . . . [because] plaintiff has already amended her complaint with the benefit of having seen Placer ARC's motion to dismiss, suggesting she was not able to add additional facts to remedy this issue raised therein." See First Am. Compl. ("FAC"), ECF No. 18; First MTD, ECF No. 12.

Defendant Placer ARC moves under Rule 12(b)(6) again to dismiss plaintiff's first and second causes of action: (1) violation of the Rehabilitation Act of 1973, § 504 and (2) retaliation under § 504. Placer Second Mot. to Dismiss ("SMTD"), ECF No. 40. Plaintiff opposes, Opp'n, ECF No. 49, and defendant has replied. Reply, ECF No. 51.

B. Defendant Alta California Regional Center

In its second amended complaint, plaintiff asserts Alta California Regional Center (ACRC) is a "non-profit entity charged with the responsibility of coordinating and developing the supports and services guaranteed by the Lanterman Act." SAC ¶ 10. The Lanterman Act "passed in 1977, [to] ensure that individuals with developmental disabilities had the right to supports and services to enable them to live more independent lives." Id. ¶ 17. Alta California RegionalCenter is one of "twenty-one regional centers mandated to secur[e] supports and services in addition to monitoring service providers" Id. ¶ 10. "Regional centers are responsible for using the federal [Home and Community-Based Services] waiver dollars to coordinate, provide, arrange, and purchase all HCBS Waiver services for eligible individuals like [plaintiff]" and "for developing an [Individual Program Plan] that ensure[s] the health and welfare of individuals receiving HCBS Waiver support services." Id. ¶ 8.

Defendant Alta California Regional Center now moves to dismiss plaintiff's second amended complaint in its entirety pursuant to Rule 12(b)(1) for lack of subject-matter jurisdiction based on the doctrine of failure to exhaust administrative remedies. Alta California Regional Center Mot. to Dismiss ("Alta Cal. MTD"), ECF No. 43. In the alternative, plaintiff also argues the first, second, and fifth causes of action should be dismissed under Rule 12(b)(6). They are (1) violation of the Rehabilitation Act of 1973, § 504; (2) retaliation under § 504; and (3) violation of the California Unruh Civil Rights Act, Cal. Civ. Code section 51. Id. Plaintiff opposes, Opp'n, ECF No. 48, and defendant replied, Reply, ECF No. 50.

II. LEGAL STANDARD

A. Rule 12(b)(1)

"Federal courts are courts of limited jurisdiction . . . [and] it is to be presumed that a cause lies outside this limited jurisdiction" Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994). Under Rule 12(b)(1) of the Federal Rules of Civil Procedure, a defending party may move to dismiss a complaint for "lack of subject-matter jurisdiction." A "jurisdictional attack can be either facial or factual." White v. Lee, 227 F.3d 1214, 1242 (9th Cir. 2000). "If the motion to dismiss constitutes a facial attack, the [c]ourt must consider the factual allegations of the complaint to be true." Allen v. Santa Clara Cty. Corr. Peace Officers Ass'n, 400 F. Supp. 3d 998, 1001 (E.D. Cal. 2019). "It then becomes necessary for the party opposing the motion to . . . satisfy its burden of establishing that the court, in fact, possesses subject matter jurisdiction." St. Clair v. City of Chico, 880 F.2d 199, 201 (9th Cir. 1989).

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B. Rule 12(b)(6)

Under Rule 12(b)(6) of the Federal Rules of Civil Procedure, a party may move to dismiss a complaint for "failure to state a claim upon which relief can be granted." A court may dismiss "based on the lack of cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory." Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990).

Although a complaint need contain only "a short and plain statement of the claim showing that the pleader is entitled to relief," Fed. R. Civ. P. 8(a)(2), in order to survive a motion to dismiss this short and plain statement "must contain sufficient factual matter . . . to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A complaint must include something more than "an unadorned, the-defendant-unlawfully-harmed-me accusation" or "'labels and conclusions' or 'a formulaic recitation of the elements of a cause of action.'" Id. (quoting Twombly, 550 U.S. at 555). Determining whether a complaint will survive a motion to dismiss for failure to state a claim is a "context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 679. Ultimately, the inquiry focuses on the interplay between the factual allegations of the complaint and the dispositive issues of law in the action. See Hishon v. King & Spalding, 467 U.S. 69, 73 (1984).

In making this context-specific evaluation, this court must construe the complaint in the light most favorable to the plaintiff and accept as true the factual allegations of the complaint. Erickson v. Pardus, 551 U.S. 89, 93-94 (2007). This rule does not apply to "a legal conclusion couched as a factual allegation," Papasan v. Allain, 478 U.S. 265, 286 (1986) quoted in Twombly, 550 U.S. at 555, nor to "allegations that contradict matters properly subject to judicial notice" or to material attached to or incorporated by reference into the complaint. Sprewell v. Golden State Warriors, 266 F.3d 979, 988-89 (9th Cir. 2001). A court's consideration of documents attached to a complaint or incorporated by reference or matter of judicial notice will not convert a motion to dismiss into a motion for summary judgment. United States v. Ritchie, 342 F.3d 903, 907-08 (9th Cir. 2003); Parks Sch. of Bus. v. Symington, 51 F.3d1480, 1484 (9th Cir. 1995); but see Buskirk v. Cable News Network, Inc., 284 F.3d 977, 980 (9th Cir. 2002) (noting that even though court may look beyond pleadings on motion to dismiss, generally court is limited to face of the complaint on 12(b)(6) motion).

III. DISCUSSION

The court does not address each claim separately because doing so is unnecessary to resolve the instant motions.

A. Liability of Placer ARC

Defendant argues plaintiff has failed to cure the defects that plagued the initial complaint and, as such, both claims under the Rehabilitation Act should be dismissed. Placer SMTD at 1; see generally MTD Order.

In opposition, plaintiff maintains the second amended complaint sufficiently alleges defendant is the recipient of federal funds and "the fact that Placer ARC receives federal funds through an intermediary source, i.e., Alta California Regional Center, is no basis to dismiss the Complaint." Opp'n at 3. Plaintiff relies on Grove City College v. Bell, 465 U.S. 555, 556 (1984), where the Court held "Title IX coverage is not foreclosed merely because federal funds are granted to the students rather than to the College's educational programs." In reply, defendant argues "[t]here is an enormous difference between having to use a [Basic Educational Opportunity Grant] subsidy to purchase an education and The Rehabilitation Act funding provided to organizations like [defendant] ALTA CALIFORNIA REGIONAL CENTER to purchase whatever services are needed for a qualifying recipient . . . the later [sic] scenario is a purchase of services and not a subsidy for the program." Reply at 5. The court addresses these arguments as necessary below.

The Rehabilitation Act covers only the recipients of federal financial assistance and not the recipients of compensatory payments for services. Jacobson v. Delta Airlines, Inc., 742 F. 2d 1202, 1209 (9th Cir. 1984). Section 504 of the Rehabilitation Act prohibits discrimination "under any program or activity receiving federal financial assistance." 29 U.S.C. § 794 (1982). See MTD Order at 4 ("Federal financial assistance means...