Opinion
22-cv-07486-NC
10-10-2023
ERIC ROJAS, Plaintiff, v. AARAV HOSPITALITY LLC, Defendant.
ORDER REQUESTING REASSIGNMENT TO A DISTRICT COURT JUDGE; REPORT AND RECOMMENDATION TO GRANT THE PLAINTIFF'S MOTION FOR DEFAULT JUDGMENT RE: ECF 14
NATHANAEL M. COUSINS UNITED STATES MAGISTRATE JUDGE.
Plaintiff Eric Rojas filed a complaint against Defendant AARAV Hospitality LLC, owner of the Ocean Lodge in Santa Cruz, California. Rojas alleges AARAV violated the Americans with Disabilities Act (“ADA”) and related California laws. Rojas seeks damages, attorneys' fees and costs, and injunctive relief. AARAV previously participated in this action, though did not consent to magistrate judge jurisdiction. AARAV subsequently failed to respond or defend itself. The Clerk entered default, and Rojas now moves for default judgment. Because AARAV did not consent to magistrate jurisdiction, the Court requests reassignment of this case to a District Judge with a recommendation to grant Rojas's motion for default judgment.
I. BACKGROUND
According to the complaint, Plaintiff Rojas has partial mid-body paralysis and complete, bilateral paralysis of his lower body. ECF 1 (“Compl.”) ¶ 7. He cannot walk and uses a wheelchair for mobility. Id. Defendant AARAV owns the Ocean Lodge, located at 1015 Ocean St in Santa Cruz, California. Id. ¶¶ 1, 8. Ocean Lodge is a place of public accommodation. Id. ¶ 11.
Rojas visited the Ocean Lodge in August 2021 planning to book a room. Id. ¶¶ 13-14. Rojas struggled to access the front office because of improperly-sized ramp landings and inadequate wheelchair clearance at the office door. Id. ¶ 14. Despite requesting an accessible room, he alleges his room was also inaccessible. Specifically, the entryway threshold was greater than a half-inch; the space between the room's beds was less than 36 inches; the bathroom door did not provide 32 inches of passing clearance; and the bathroom did not provide adequate turning space for his wheelchair. Id. ¶ 15. Rojas claims he would stay at the Ocean Lodge in the future, but its current conditions deter him from returning. Id. ¶ 16.
Counsel for Rojas performed further “informal investigation” of the Ocean Lodge. Id. ¶ 17. Counsel noted the following additional barriers to access: (1) no directional signage at office ramp; (2) excessive ramp slope; (3) no accessible path between rooms and office; (4) no accessible path to vending machines; (5) no tow away signage; (6) no accessible parking signage; and (7) parked cars between designated accessible parking and the building. Id.
Rojas filed his complaint on November 28, 2022. See Compl. AARAV filed a stipulation to extend time for its response on February 2, 2023. ECF 10. AARAV failed to respond. On Rojas's motion, the Clerk entered default against AARAV. ECF 12. The instant motion followed. ECF 14, Motion for Default Judgment (“MDJ”). The Court held a hearing on this motion on September 27, 2023. Defendants did not appear at the hearing. ECF 31.
II. LEGAL STANDARD
Following a defendant's default, courts have discretion to enter default judgment. Fed.R.Civ.P. 55(b); Aldabe v. Aldabe, 616 F.2d 1089, 1092 (9th Cir. 1980). Before doing so, courts must ensure they have subject matter and personal jurisdiction and that the plaintiff adequately served the defendant. See In re Tuli, 172 F.3d 707, 712 (9th Cir. 1999). Courts then turn to the Eitel factors to decide whether to grant default judgment: (1) the merits of the plaintiff's substantive claim; (2) the sufficiency of the complaint; (3) the sum of money at stake in the action; (4) the possibility of prejudice to the plaintiff; (5) the possibility of a dispute concerning material facts; (6) whether the default was due to excusable neglect; and (7) the strong policy favoring decisions on the merits. Eitel v. McCool, 782 F.2d 1470, 1471-72 (9th Cir. 1986). Courts consider these factors in combination when appropriate. See Dr. JKL Ltd. v. HPC IT Educ. Ctr., 749 F.Supp.2d 1038, 1048 (N.D. Cal. 2010) (“Under an Eitel analysis, the merits of plaintiff's substantive claims and the sufficiency of the complaint are often analyzed together.”). Factual allegations in the complaint, except those concerning damages, are deemed admitted by the non-responding parties. HICA Educ. Loan Corp. v. Warne, No. 11-cv-04287-LHK, 2012 WL 1156402, at *1 (N.D. Cal. Apr. 6, 2012) (citing Fair Hous. of Marin v. Combs, 285 F.3d 899, 906 (9th Cir. 2002)).
III. DISCUSSION
This Court, finding jurisdiction appropriate and service adequate, concludes the Eitel factors weigh in favor of granting default judgment against AARAV. Accordingly, this Court recommends the District Judge grant Rojas's motion for default judgment.
A. Jurisdiction
1.This Court Has Subject Matter Jurisdiction Over Rojas's Claims
Rojas brings claims under the ADA, 42 U.S.C. § 12101 et seq., California's Unruh Act, Cal. Civ. Code section 51 et seq., and the California Health and Safety Code, section 19955 et seq. District courts have subject matter jurisdiction over all civil actions arising under the laws of the United States. 28 U.S.C. § 1331. The ADA is a federal law, so Rojas's ADA claims arise under a law of the United States. See id. Accordingly, this court has subject matter jurisdiction over his ADA claims.
District courts with subject matter jurisdiction may exercise supplemental jurisdiction over all other claims that are “so related to claims in the action…that they form part of the same case or controversy.” 28 U.S.C. § 1367. Rojas's California claims form part of the same case or controversy as his ADA claims because they stem from the same visit to the Ocean Lodge. See Compl. Because his California claims form part of the same case or controversy, this Court exercises its supplemental jurisdiction over those claims.
2. This Courts Has Personal Jurisdiction Over AARAV
In addition to subject matter jurisdiction, courts must have personal jurisdiction over defendants to enter a default judgment. In re Tuli, 172 F.3d at 712. Corporations are subject to general personal jurisdiction “at home,” including in their state of incorporation and principal place of business. Daimler AG v. Bauman, 571 U.S. 117, 137 (2014) (citing Goodyear Dunlop Tires Operations, S.A. v. Brown, 564 U.S. 915, 924, (2011)). The same applies to non-corporate business entities, including limited liability companies. Allen v. Shutterfly, Inc., No. 20-cv-02448-BLF, 2020 WL 5517170, at *3 (N.D. Cal. Sept. 14, 2020); see also In re Packaged Seafood Prod. Antitrust Litig., 338 F.Supp.3d 1118, 1139 n.14 (S.D. Cal. 2018) (“Generally, courts apply Daimler to non-corporate business entities.”). AARAV is a limited liability company with its principal place of business in California. ECF 16, Ex. 8. Thus, AARAV is “at home” in California, and this Court has general personal jurisdiction over AARAV.
“[A] court may take judicial notice of matters of public record.” Lee v. City of Los Angeles, 250 F.3d 668, 689 (9th Cir.2001) (quotations omitted). This Court takes judicial notice of AARAV's statement of interest filed with the California Secretary of State. ECF 16, Ex. 8.
B. Rojas Adequately Served AARAV
Before ruling on a default judgment, courts must first ensure service was adequate. Pension Plan for Pension Trust Fund for Operating Eng'rs v. J&J Equip., Inc., No. 18-cv-07419-KAW, 2019 WL 5088781, at *3 (N.D. Cal. Aug. 8, 2019) (citing Bank of the West v. RMA Lumber Inc., No. 07-cv-6469-JSW, 2008 WL 247650, at *2 (N.D. Cal. June 17, 2008)). Serving an “unincorporated association,” such as an LLC, requires “delivering a copy of the summons and of the complaint to an officer, a managing or general agent, or any other agent authorized by appointment or by law to receive service of process . . . .” Fed. R. Civ. P. 4(h)(1)(B). Alternatively, plaintiffs may serve unincorporated entities in any manner permitted for serving an individual. Fed.R.Civ.P. 4(h)(1)(A). That includes “following state law for serving a summons in an action brought in courts of general jurisdiction in the state where the district court is located or where service is made.” Fed.R.Civ.P. 4(e)(1). Under California law, a plaintiff may serve an entity defendant by leaving a copy of the summons and complaint during usual business hours with a person apparently in charge and at least 18 years old, and subsequently mailing a copy to the entity's service agent. Cal. Civ. Proc. Code § 415.20(a).
Here, Rojas properly served AARAV under California law. See Cal. Civ. Proc. Code § 415.20. Rojas served “Mr. Arke,” the Ocean Lodge manager. ECF 8. According to the proof of service, Mr. Arke was “a person at least 18 years of age apparently in charge at the office.” Id. Rojas also mailed a copy to AARAV's designated agent for service, Kamaleshkumar Patel. Id.; ECF 16, Ex. 8. Ocean Lodge's address matches the address listed for Patel on AARAV's registration with the California Secretary of State. See ECF 8; ECF 16, Ex. 8. By taking these two steps, Rojas complied with California's requirements for service of an entity defendant, and thus properly served AARAV. See Cal. Civ. Proc. Code § 415.20(a); Fed.R.Civ.P. 4(e)(1). Additionally, Rojas served AARAV with his motion for default judgment. ECF 27.
To effectuate service, the serving party does not need the full name of the individual accepting service. J & J Sports Prods., Inc. v. Barksdale, No. 11-cv-2994-JAM, 2012 WL 1353903, at *5 (E.D. Cal. Apr. 13, 2012) (citing Trackman v. Kenney, 187 Cal.App.4th 175, 182-83 (2010)).
C. The Eitel Factors Weigh in Favor of Default Judgment
Finding jurisdiction proper and service adequate, this Court proceeds to the Eitel factors. This Court finds the Eitel factors weigh in favor of granting default judgment.
1.Merits of Plaintiff's Claim and Sufficiency of the Complaint
The first and second Eitel factors consider the merits of the plaintiff's substantive claim and the sufficiency of the complaint. In analyzing these factors, courts accept as true “all well-pleaded allegations regarding liability.” HICA Educ. Loan Corp, 2012 WL 1156402, at *2. Here, both factors weigh in favor of default judgment.
a. ADA Claims
Rojas's ADA claims come under Title III. Compl. ¶¶ 22-33. Plaintiffs bringing claims under Title III must establish: (1) they have a disability within the meaning of the ADA; (2) the defendant “owns, leases, or operates a place of public accommodation;” and (3) the defendant denied them public accommodations because of their disability. Lopez v. Catalina Channel Express, Inc., 974 F.3d 1030, 1033 (9th Cir. 2020). Here, Rojas states he suffers paralysis requiring use of a wheelchair, meeting the first element. See Compl. ¶ 7. He also states that AARAV owns the Ocean Lodge, a place of public accommodation, meeting the second. See id. ¶ 8. As discussed below, his allegations also meet the third element, discrimination.
To establish discrimination, Rojas must show: (1) a failure to remove accessibility barriers and (2) that removal was readily achievable or that access was otherwise achievable through alternative methods. 42 U.S.C. §§ 12182(b)(2)(A)(iv)-(v); Lopez v. Catalina Channel Express, Inc., 974 F.3d 1030, 1038-39 (9th Cir. 2020). At step one, Rojas's alleges barriers to accessing the Ocean Lodge front office and his room. Compl. ¶¶ 14-15. He states the office's ramps lacked adequate landings and the office door lacked adequate clearance. Id. ¶ 14. Rojas claims his room proved even more problematic. Id. ¶ 15. His list of issues includes: excessive door threshold height; inadequate space between beds; inadequate bathroom passing clearance; no bathroom under-sink space; no bathroom grab bars; and inadequate turning space within the bathroom. Id. In addition to Rojas' own observation, counsel for Rojas includes a litany of other issues noted during “informal investigation.” Id. ¶ 17. Accepted as true for the purposes of this analysis, these allegations satisfy the first prong of the discrimination test. See HICA Educ. Loan Corp, 2012 WL 1156402, at *2.
Though Rojas provides fewer details at step two, his allegations still suffice. Whether removal of an architectural barrier is readily achievable depends in part on when the place of public accommodation was constructed and whether alterations have since occurred. Moeller v. Taco Bell Corp., 816 F.Supp.2d 831, 847 (N.D. Cal. 2011). Rojas alleges the timing of the construction of Ocean Lodge as well as later modifications make removal readily achievable by law. Compl. ¶¶ 27, 29. Additionally, he describes removal of the barriers as “readily achievable,” “fundamental to doing business,” and “the types of barriers identified by the Department of Justice as being readily achievable.” Id. ¶ 28; see also ECF 18, Declaration of Bassam Altwal (“Altwal Decl.”) ¶¶ 6-25 (outlining barriers and removability). This Court accepts these allegations as true, including Rojas's allegations regarding Ocean Lodge's construction history. See HICA Educ. Loan Corp, 2012 WL 1156402, at *2. And, though threadbare, courts find allegations like Rojas's adequate at default judgment. Johnson v. Prospect Venture LLC, No. 5:21-cv-04195-EJD, 2022 WL 2276890, at *5 (N.D. Cal. June 23, 2020) (collecting cases). So too does this Court. Thus, Rojas adequately alleges discrimination.
By meeting these three elements, Rojas sufficiently states a claim for disability discrimination under Title III of the ADA. As such, these Eitel factors weigh in favor of granting default judgment on Rojas's ADA claims.
b. California Claims
Rojas also brings two California law claims. His allegations suffice to state a claim under both, and their sufficiency also weigh in favor of default judgment.
i. Unruh Act Claims
“A violation of the right of any individual under the [ADA] also constitute[s] a violation of” the Unruh Act. Cal. Civ. Code § 51(f). By establishing his ADA claim, Rojas establishes his Unruh claim. See id.
ii. Health and Safety Code Claims
Similarly, this Court finds Rojas adequately alleged a claim under the California Health and Safety Code. “All buildings constructed or altered after July 1, 1970, must comply with standards governing the physical accessibility of public accommodations.” Ridola v. Chao, No. 16-cv-02246-BLF, 2018 WL 2287668, at *11 (N.D. Cal. May 18, 2018) (citing California Health and Safety Code § 19955 and Gov't Code § 4450(a)). Rojas alleges the Ocean Lodge is an inaccessible public accommodation “constructed and/or altered after July 1, 1970, and substantial portions of Ocean Lodge and/or the building(s) had alternations, structural repairs, and/or additions made . . . after July 1, 1970.” Compl. ¶¶ 44, 47. As with his ADA claims, this Court accepts these allegations as true and finds them sufficient.
2. Sum of Money at Stake
Courts next examine the amount at issue in the action. “When the money at stake in the litigation is substantial or unreasonable, default judgment is discouraged.” Board of Trs. v. Core Concrete Const., Inc., No. 11-cv-02532-LB, 2012 WL 380304, at *4 (N.D. Cal. Jan. 17, 2012) (citations omitted). However, when “the sum of money at stake is tailored to the specific misconduct of the defendant, default judgment may be appropriate.” Id. (citations omitted).
Rojas seeks $4,000 in statutory damages and $17,486.34 in fees and costs. MDJ 23-24. Though not insignificant, as this Court scrutinizes further below, on its face this amount is proportional to the alleged conduct. Thus, this factor too weighs in favor of default judgment.
3. Possibility of Prejudice to Plaintiff
Courts also weigh the possibility of prejudice. Courts grant default judgment where plaintiffs are left without an alternative remedy because defendants have failed to appear or otherwise defend the action against them. See, e.g., Dr. JKL Ltd., 749 F.Supp.2d at 1049-50; Pepsico, Inc. v. Cal. Sec. Cans, 238 F.Supp.2d 1172, 1177 (C.D. Cal. 2002).
AARAV failed to defend this action, despite filing a stipulation extending the time to do so. ECF 10. Without default judgment, Rojas will likely have no recourse available to vindicate his rights under the ADA. Because such a loss would prejudice Rojas, this factor weighs in favor of default judgment.
4. Dispute of Material Facts and Excusable Neglect
Courts must also consider the likelihood of dispute concerning material facts, as well as whether a defendant's failure to respond owed to excusable neglect. Eitel, 782 F.2d at 1471-72. In addition to serving AARAV with the complaint, Rojas provided other service and notice in this matter. See ECF 25, 27, 30. Despite this, AARAV did not respond or defend itself, even after requesting an extension of time to do so. See ECF 10. Moreover, once the Clerk entered default on AARAV, this Court accepts Rojas's allegations as true. See HICA Educ. Loan Corp, 2012 WL 1156402, at *2. Thus, there are no disputed material facts, and this factor weighs in favor of default judgment. And these same failures to engage with this matter show AARAV's default was not due to excusable neglect. Unsurprisingly, that factor also favors default judgment.
5. Policy Favoring Decisions on the Merits
Finally, Eitel cautions that “cases should be decided upon their merits whenever reasonably possible.” Eitel, 782 F.2d at 1472. However, Defendants' non-appearance renders a decision on the merits impossible. See Heifetz v. Breed Props., No. 16-cv-1490-CRB, 2017 WL 713303, at *4 (N.D. Cal. Feb. 23, 2017).
Taken together, the Court finds default judgment appropriate and recommends the District Judge grant Rojas's motion for default judgment.
D. Relief Recommended
Rojas requests statutory damages, injunctive relief, and various attorneys' fees and costs. This Court recommends awarding the requested statutory damages and injunctive relief, as well as modified attorneys' fees and costs as specified below.
1. Statutory Damages
The Unruh act authorizes recovery of at least $4,000 for each occasion on which the defendant's “violation or violations of one or more construction-related accessibility standards denied the plaintiff full and equal access.” Cal. Civ. Code § 55.56(a). “The litigant need not prove she suffered actual damages to recover the independent statutory damages of $4,000.” Molski v. M.J. Cable, Inc., 481 F.3d 724, 731 (9th Cir. 2007).
Rojas alleges he visited AARAV's Ocean Lodge on August 3, 2021. Compl. ¶ 13. He states he encountered accessibility barriers at the front office as well as in his room. Id. ¶¶ 14-15. He requests an award of $4,000 in statutory damages. ECF 10 23-24. Finding Rojas's allegations meet the standard for statutory damages under the Unruh Act, this Court recommends a statutory award of $4,000.
2. Injunctive Relief
The ADA authorizes injunctive relief for the type of violations alleged by Rojas. See 42 U.S.C. § 12188(a)(2). “[I]njunctive relief is proper when architectural barriers at the defendant's establishment violate the ADA and the removal of the barriers is readily achievable.” Ridola, 2018 WL 2287668, at *13 (citing Moreno v. La Curacao, 463 Fed.Appx. 669, 670 (9th Cir. 2011).
As discussed above, Rojas adequately alleged that the Ocean Lodge could readily remove its architectural barriers. See Compl. ¶¶ 27-29. Accordingly, this Court recommends entering an injunction requiring AARAV to provide compliant wheelchair access and signage to, from, and within its front office and wheelchair-accessible rooms.
3. Attorneys' Fees and Costs
Under the ADA, courts may award attorneys' fees and litigation costs to the prevailing party. Molski, 481 F.3d at 730 (citing 42 U.S.C. § 12205). The Unruh Act also authorizes reasonable attorney's fees. Cal. Civ. Code § 52.1(h). To assess fees, courts utilize a lodestar analysis, multiplying the number of hours reasonably spent by a reasonable hourly rate. Grove v. Wells Fargo Fin. Cal., Inc., 606 F.3d 577, 582 (9th Cir. 2010). “A reasonable hourly rate is that prevailing in the community for similar work performed by attorneys of comparable skill, experience, and reputation.” Ceres Imaging, Inc. v. S.C.A.L.E. AG Servs., LLC, No. 20-cv-06407-LB, 2021 WL 4467588, at *6 (N.D. Cal. Jan. 28, 2021). If the documentation outlining the work is inadequate, the court may reduce the award accordingly. Hensley v. Eckerhart, 461 U.S. 424, 433 (1983).
Here, counsel for Rojas request $12,438.75 in attorneys' fees and $5,047.59 in costs. For hourly rates, they request $450 for attorney Irene Karbelashvili, $375 for attorney Irakli Karbelashvili, and $275 for expert Bassam Altwal. Based on the prevailing rate for similar cases, this Court recommends modifying the attorney rates.
“The present case is a relatively simple one.” Rodgers v. Fitzgerald, No. 14-cv-00985-DMR, 2016 WL 4658974, at *5 (N.D. Cal. Sept. 7, 2016) (same attorneys bringing claims under same federal and state statutes). Courts in this District have approved hourly rates of $325 for Irene Karbelashvili and $250 for Irakli Karbelashvili in similar cases. See Macias v. FAsail, No. 19-cv-00728-LHK, 2021 WL 2719297, at *11 (N.D. Cal. July 1, 2021) (collecting cases). And these attorneys requested $325 and $250 respectively as recently as 2021. Id.; Ketroser v. UB SR LLC, No. 19-cv-05554-YGR (RMI), 2020 WL 4906068, at *10 (N.D. Cal. July 9, 2020). Considering these prior awards as well as the years of experience gained by both attorneys since, this Court finds hourly rates of $350 for Irene Karbelashvili and $275 for Irakli Karbelashvili appropriate. This Court recommends reducing the rate requested by both attorneys accordingly.
Regarding time extended, Irene Karbelashvili assigned 7.3 hours and Irakli Karbelashvili 43.4 hours to this matter. MDJ 23. Both attorneys voluntarily reduced their time spent on preparing this motion by fifty percent. Id. at 21-23. After that reduction, they claim 4.9 and 27.4 hours respectively. Id. at 21 (dividing adjusted total by requested hourly rate).
The voluntary reduction in hours appears warranted. Of the time spent on this matter, both attorneys spent a bulk on this motion. See id. at 12-13. And of the time spent on this motion, both appear to have spent a significant portion on declarations in support of their requested hourly rates. See ECF 17, Ex. 12 (Irene 2.1 of 4.9 hours); ECF 16, Ex. 6 (Irakli 16.6 of 32.1 hours). Overall, unlike other matters brought by these attorneys in this District, this matter did not involve a “lengthy procedural history . . . including a joint site inspection, motion practice, mediation, a case management conference, and a settlement conference.” See Ridola, 2018 WL 2287668, at *16 (same attorneys claiming 38.10 total hours worked). As both attorneys state in their declarations, they focus ninety-nine percent of their practice on disability rights work. ECF 16, 17. Given their familiarity with this area, the routine nature of this matter, and the disproportionate amount of time spent in support of their requested hourly rate, this Court agrees with the suggested voluntary reduction of hours suggested by the attorneys.
Rojas also requests expert fees and other litigation costs. Rojas asks for $275 per hour for 16 hours worked by his expert, Bassam Altwal. This Court finds the rate requested for Altwal reasonable and consistent with prior expert awards for Altwal in this District. See, e.g., Macias, 2021 WL 2719297, at *12. However, Altwal's declaration does not include a breakdown of how he spent his 16 hours. Altwal Decl. at 9. Because this Court cannot meaningfully review Altwal's time, it applies a modest 15% reduction in expert fees. See Banas v. Volcano Corp., 47 F.Supp.3d 957, 979 (N.D. Cal. 2014) (finding “wholly insufficient” description of expert tasks warranted “15% reduction of the expert fees.”). Instead of $4,400, this Court recommends $3,750 in expert fees.
In sum, this Court recommends approving 4.9 hours to Irene Karbelashvili at $350 per hour and 27.4 hours to Irakli Karbelashvili at $275 per hour, and awarding attorneys' fees of $9,250. Additionally, this Court recommends awarding expert fees and other costs of $4,387.59 and statutory damages of $4,000, for a total of $17,637.59.
In the instant motion, counsel for Rojas also state they will seek “additional fees incurred as a result of . . . defense of and appearance on this motion.” MDJ 23. On appearance for this motion, counsel did not seek any additional fees. Considering the brevity of that unopposed appearance and counsel's silence on additional fees, this Court does not recommend awarding any.
IV. CONCLUSION
For the reasons stated above, this Court RECOMMENDS granting Rojas's motion for default judgment. This Court recommends awarding $4,000 in statutory damages, $9,250 in attorneys' fees, and $4,387.59 in expert fees and other costs, for a total monetary award of $17,637.59, and ordering an injunction requiring AARAV to provide compliant wheelchair signage and access to, from, and within its front office and wheelchair-accessible rooms.
The Clerk of Court is asked to reassign this case to a District Judge. Rojas is ordered to serve this order on AARAV. Any party may object to this order within 14 days of being served under Fed.R.Civ.P. 72(b).
IT IS SO ORDERED.