“[W]hen the allegations in a complaint, however true, could not raise a claim of entitlement to relief, this basic deficiency should be exposed at the point of minimum expenditure of time and money by the parties and the court.” (internal quotation marks omitted)
How later courts described this case
- “[W]hen the allegations in a complaint, however true, could not raise a claim of entitlement to relief, this basic deficiency should be exposed at the point of minimum expenditure of time and money by the parties and the court.” (internal quotation marks omitted)
- “Because respondent’s complaint is deficient under Rule 8, he is not entitled to discovery, cabined or otherwise.”
- holding that the Fair Housing Act follows traditional vicarious liability principles and “imposes liability upon the corporation but not upon its officers or owners”
Written by the judges who cited it.
The opinion
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF OREGON
CAROL-LEE ZUVICH, as an individual
and on behalf of those similarly situated, Case No. 6:20-cv-00737-MC
Plaintiff, OPINION AND ORDER
v.
HARVARD STREET WISHROCK, LLC dba
Harvard Street Apartments; WISHROCK &
RAY, LLC, effectively conducts business as
part of several companies that comprise
“Wishrock Group” and/or “Wishrock”;
GUARDIAN MANAGEMENT, LLC;
GUARDIAN REAL ESTATE SERVICES, LLC;
WISHROCK INVESTMENT GROUP, LLC,
effectively conducts business as part of several
organizations that comprise “Wishrock
Group” and/or “Wishrock”; WISHCAMPER
DEVELOPMENT PARTNERS, LLC,
effectively conducts business as one of several
organizations that comprise “Wishcamper
Partners” and/or “Wishcamper”; WISHROCK
DEVELOPMENT GROUP, LLC, effectively
conducts business as part several organizations that
comprise “Wishrock Group” and/or “Wishrock”;
WISHROCK HOUSING DEVELOPERS, LLC,
effectively conducts business as part of an
organization that comprises “Wishrock Group”
and/or “Wishrock”; WISHROCK HOUSING
PARTNERS, LLC, effectively conducts business
as one of several organizations that comprise
“Wishrock Group” and/or “Wishrock”;
TEAL POINTE WISHROCK GP, LLC,
1 — OPINION AND ORDER
effectively conducts business as part of several
organizations that comprise “Wishrock
Group” and/or “Wishrock”; JEWEL HOUSING
SERVICES, LLC, previously known as
Wishrock Housing Services, LLC and/or
Rehabilitation and Logistics, LLC, effectively
conducts business as part of several
companies that comprise “Wishrock Group”
and/or “Wishrock”; WISHROCK INVESTMENT
GROUP II, LLC, effectively conducts business
as one of several companies that comprise
“Wishrock Group” and/or “Wishrock”;
WISHROCK OPERATIONS, INC., effectively
conducts business as one of several
organizations that comprise “Wishrock
Group” and/or “Wishrock”; and Does 1-50,
Defendants.
_____________________________________
MCSHANE, Judge:
Plaintiff Carol-Lee Zuvich originally brought this claim for housing discrimination
against Defendants Harvard Street Wishrock, Wishrock & Ray, Guardian Management, and
Guardian Real Estate Services. Pl.’s Compl., ECF No. 1. Plaintiff has since added nine other
defendants (“Additional Defendants”) whose only connections to her claim are shared names and
mailing addresses with the original defendants. Pl.’s First Amended Complaint, ECF No. 27
(“FAC”). Additional Defendants move to dismiss. Defs.’ Mot., ECF No. 60. Because Plaintiff
has failed to identify a single action or omission on the part of Additional Defendants that would
give rise to a claim against them, Defendants’ Motion to Dismiss, ECF No. 60, is GRANTED.
2 – OPINION AND ORDER
BACKGROUND1
Plaintiff has lived at Harvard Street Apartments since June 2015. FAC ¶ 26. Harvard
Street Apartments is currently owned by Harvard Street Wishrock and managed by Guardian
Management. FAC ¶¶ 6–7, 19–20. Wishrock & Ray and Guardian Real Estate Services are their
respective parent corporations. Id.
Due to her phobia of large dogs, Plaintiff requested an accommodation in 2016 that no
large dogs be permitted to live in the apartments immediately adjacent to hers. FAC ¶ 27. This
accommodation was granted and noted in Plaintiff’s resident file FAC ¶ 27, 31. When the
apartment complex changed management, Plaintiff spoke with the previous manager about her
accommodation, asking her to pass the message on to Hollie Forsman, the Portfolio Manager at
Guardian Real Estate Services. FAC ¶¶ 27, 29.
To Plaintiff’s surprise, a new tenant with a large dog moved in to one of the adjacent
apartment buildings in April 2019. FAC ¶ 30. Plaintiff renewed her accommodation request in
May 2019. FAC ¶ 27, 33. Over the next few months, Plaintiff and Defendants Harvard Street
Wishrock and Guardian Management unsuccessfully attempted to find a satisfactory resolution
for all involved. FAC ¶¶ 33–43. The tenant with the dog moved out in March 2020. FAC ¶ 60.
Defendants Wishcamper Development Partners, a Montana corporation, and Teal Pointe
Wishrock Gp., a Maine corporation, neither own nor manage Harvard Street Apartments. Ray
Decl. ¶¶ 4–5, ECF No. 61. Defendants Wishrock Investment Group, Wishrock Development
Group, Wishrock Housing Developers, Wishrock Housing Partners, Jewel Housing Services,
1 At the motion to dismiss stage, this Court takes all of Plaintiffs’ allegations as true. See Burget v. Lokelani Bernice
Pauahi Bishop Trust, 200 F.3d 661, 663 (9th Cir. 2000).
3 – OPINION AND ORDER
Wishrock Investment Group II, and Wishrock Operations (together, “Wishrock Defendants”) are
Maine corporations who have no presence in Oregon. Rose Decl. ¶¶ 2–8, ECF No. 62. They do
not own any property in Oregon, including Harvard Street Apartments, nor do they have any
offices in the state. Id. They have not entered into any contracts, solicited any business, or sold
any goods or services in Oregon.2 Id.
DISCUSSION
I. 12(b)(6) Failure to State a Claim
To survive a motion to dismiss under Fed. R. Civ. P. 12(b)(6), a complaint must contain
sufficient factual matter that “state[s] a claim to relief that is plausible on its face.” Bell Atlantic
Corp. v. Twombly, 550 U.S. 544, 570 (2007). A claim is plausible on its face when the factual
allegations allow the court to infer the defendant’s liability based on the alleged conduct.
Ashcroft v. Iqbal, 556 U.S. 662, 663 (2009). The factual allegations must present more than “the
mere possibility of misconduct.” Id. at 678.
When considering a motion to dismiss, the court must accept all allegations of material
fact as true and construe those facts in the light most favorable to the non-movant. Burget v.
Lokelani Bernice Pauahi Bishop Trust, 200 F.3d 661, 663 (9th Cir. 2000). However, the court is
“not bound to accept as true a legal conclusion couched as a factual allegation.” Twombly, 550
U.S. at 555. If the complaint is dismissed, leave to amend should be granted unless “the pleading
could not possibly be cured by the allegation of other facts.” Doe v. United States, 58 F.3d 494,
497 (9th Cir. 1995).
2 Defendant Wishrock Housing Partners was a founding member of Wishrock & Ray but sold their interest in 2018.
Rose Decl. ¶ 5.
4 – OPINION AND ORDER
Plaintiff alleges that Harvard Street Wishrock, as property owner, and Guardian
Management, as property manager, discriminated against her by failing to accommodate her
disability. When it comes to Additional Defendants, however, Plaintiff’s complaint does not
attribute a single act, omission, or effort to them. The Court cannot draw any inference of
liability when the Plaintiff has not alleged any misconduct on the part of Additional Defendants.
Further, Plaintiff has not provided any facts “to raise a reasonable expectation that discovery will
reveal evidence” supporting the allegation. Twombly, 550 U.S. at 545.
Plaintiff argues instead that all defendants acted as a de facto corporation, and that this
makes them all liable for the actions of one. Plaintiff insists that “every fact in each portion of
[her complaint] apply to all Defendants.” Pl.’s Opp’n 18, ECF No. 81. In support, Plaintiff notes
that some of these entities have the same contact address as Harvard Street Wishrock or
Wishrock & Ray, that there is commonality in management or membership, that they are covered
by the same insurance, and that defendants as a whole hold themselves out as “Wishrock Group”
or “Wishrock.” Id. at 2, 11–12. Plaintiff points to the website of Defendant Wishcamper
Development Partners, which notes Harvard Street Wishrock as one of the “projects developed
by principals.” Id. at 15. Plaintiff argues that these connections justify holding Additional
Defendants responsible for the actions of Harvard Street Wishrock and Wishrock & Ray. Id. at
12. Plaintiff does not allege that Defendants colluded or conspired in order to discriminate
against her. Id. at 6. Even an allegation of conspiracy or agreement would require “further factual
enhancement” to reach the line of plausibility. Twombly, 550 U.S. at 557.
The Court does not dispute the connections that Plaintiff has noted between the many
Defendants. But Additional Defendants neither own nor manage Plaintiff’s apartment building.
5 – OPINION AND ORDER
Overlap in “executives, managers, board members, owners, [or] partners”, as Plaintiff alleges,
does not justify imposing liability on one corporation for the actions of another. Cf. Meyer v.
Holley, 537 U.S. 280, 282 (2003) (holding that the Fair Housing Act follows traditional vicarious
liability principles and “imposes liability upon the corporation but not upon its officers or
owners”). While several Defendants have collaborated to create affordable housing options
across the United States, Plaintiff does not allege that they collaborated in discriminating against
her.
Plaintiff’s argument regarding “piercing the corporate veil” is similarly unpersuasive.
Piercing the corporate veil “is an extraordinary remedy which exists as a last resort, where there
is no other adequate and available remedy to repair plaintiff’s injury.” Amfac Foods v. Int’l
Systems, 294 Or. 94, 103 (1982). Plaintiff’s claims against the original Defendants provide an
adequate remedy. Further, to pierce the corporate veil, Plaintiff must show that Wishrock
Defendants controlled Harvard Street Apartments and that they used this control to engage in
improper conduct that harmed her. Neidig v. Superior Nat’l Ins. Co., 343 Or. 434, 454–55
(2006). Plaintiff makes no such showing.
Plaintiff has already identified and brought suit against the proper defendants here: the
owner and manager of her apartment complex and their respective parent companies. Any relief
to which she is entitled must be sought from them. Dismissal of Additional Defendants allows
Plaintiff’s claim to proceed against the correct defendants without wasting resources. See
Twombly, 550 U.S. at 558 (“[W]hen the allegations in a complaint, however true, could not raise
a claim of entitlement to relief, this basic deficiency should be exposed at the point of minimum
expenditure of time and money by the parties and the court.” (internal quotation marks omitted)).
6 – OPINION AND ORDER
II. Personal Jurisdiction over Wishrock Defendants
Wishrock Defendants also move to dismiss for lack of personal jurisdiction. “Jurisdiction
to resolve cases on the merits requires both authority over the category of claim in suit (subject-
matter jurisdiction) and authority over the parties (personal jurisdiction).” Ruhrgas Ag v.
Marathon Oil Co., 526 U.S. 574, 577 (1999). Here, there is no dispute that the Court has subject-
matter jurisdiction over the claim under 28 U.S.C. § 1331. However, that does not establish
personal jurisdiction over Wishrock Defendants.
Where there is no applicable federal statute governing personal jurisdiction, a district
court must apply the law of the state in which it sits. See Fed. R. Civ. P. 4(k)(1)(A); Panavision
Int’l, L.P. v. Toeppen, 141 F.3d 1316, 1320 (9th Cir. 1998). Oregon law authorizes personal
jurisdiction to the full extent permitted by the Due Process Clause of the U.S. Constitution. See
Or. R. Civ. P. 4L. To comport with the requirements of due process, a court may only exercise
personal jurisdiction over a non-resident defendant if that defendant has sufficient “minimum
contacts” with the forum state, such that the exercise of personal jurisdiction would not “offend
traditional notions of fair play and substantial justice.” Int’l Shoe Co. v. Washington, 326 U.S.
310, 316 (1945) (citations and internal quotation marks omitted). A defendant’s minimum
contacts may be established through a showing of either general or specific jurisdiction.
Schwarzenegger v. Fred Martin Motor Co., 374 F.3d 797, 801 (9th Cir. 2004). Plaintiffs bear the
burden of establishing either basis for personal jurisdiction, addressed in turn.
A. General Personal Jurisdiction
A defendant is subject to general jurisdiction if its contacts with the forum state are “so
continuous and systemic as to render it essentially at home” there. Daimler v. Bauman, 571 U.S.
7 – OPINION AND ORDER
117, 127 (2014) (citations and internal quotation marks omitted). Here, there is no evidence that
Defendants have sufficient contacts to support general jurisdiction in Oregon. Wishrock
Defendants are Maine corporations who own no property in Oregon, have no offices in the state,
have not entered into any contracts, solicited any business, or sold any goods or services in
Oregon. It would therefore be inconsistent with due process for the Court to exercise general
jurisdiction over Defendants.
B. Specific Personal Jurisdiction
In the Ninth Circuit, courts apply a three-part test to determine whether the exercise of
specific jurisdiction over a non-resident defendant is appropriate:
(1) the non-resident defendant must purposefully direct his activities or
consummate some transaction with the forum or resident thereof; or perform
some act by which he purposefully avails himself of the privilege of conducting
activities in the forum, thereby invoking the benefits and protections of its laws;
(2) the claim must be one which arises out of or relates to the defendant’s
forum-related activities; and
(3) the exercise of jurisdiction must comport with fair play and substantial
justice, i.e. it must be reasonable.
Schwarzenegger, 374 F.3d at 802 (citation omitted). A plaintiff bears the burden of establishing
the first two elements of the test, after which the burden shifts to the defendant to “present a
compelling case” that the exercise of jurisdiction would not be reasonable. Burger King Corp. v.
Rudzewic, 471 U.S. 462, 477 (1985). “[I]f the plaintiff fails at the first step,” however, “the
jurisdictional inquiry ends.” Boschetto v. Hansing, 539 F.3d 1011, 1016 (9th Cir. 2008).
In order to establish purposeful availment, Plaintiff must show that Wishrock Defendants
“engaged in significant activities within [the] state” or “created ‘continuing obligations’ between
[themselves] and residents.” Burger King, 471 U.S. at 475–76. “[U]nilateral activity of another
8 – OPINION AND ORDER
party or a third person is not an appropriate consideration when determining whether a defendant
has sufficient contacts with a forum State to justify an assertion of jurisdiction.” Helicopteros
Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408, 417 (1984). Here, Plaintiff has not
identified any action, in-state or otherwise, on the part of Wishrock Defendants that would
suggest purposeful availment. Wishrock Defendants do not own property in Oregon. They have
not entered into any contracts in Oregon, nor have they solicited any business or sold any goods
or services in the state. Simply put, Wishrock Defendants have no minimum contacts with
Oregon.
Accordingly, the Court finds that it would be inconsistent with due process to exercise
specific jurisdiction over Defendants. Without a basis for general or specific jurisdiction,
Plaintiff cannot bring suit against Wishrock Defendants in Oregon courts.
III. Plaintiff’s Leave to Amend and Request to Defer
Plaintiff moves for leave to amend again, in order to add more defendants. Pl.’s Mot.,
ECF No. 83. After a responsive pleading is served, plaintiffs must request leave of court to
further amend a complaint. Fed. R. Civ. P. 15. District courts have significant discretion when
considering leave to amend, but courts usually grant such leave liberally “when justice so
requires.” Ascon Properties, Inc. v. Mobil Oil Co., 866 F.2d 1149, 1160 (9th Cir. 1989).
However, four main factors—undue prejudice to the defendant, undue delay, plaintiff’s bad faith,
and futility—limit that liberality. DCD Programs v. Leighton, 833 F.2d 183, 186 (9th Cir. 1987).
Further, courts may consider “whether plaintiff has previously amended its complaint.” Ascon
Properties, 866 F.2d at 1160. The factors weigh differently, but the only factor that is by itself
9 – OPINION AND ORDER
insufficient as grounds for dismissal is undue delay, which is not at issue here. Leighton, 833
F.2d at 186.
Plaintiff’s Proposed Amended Complaint does “not add any new claims, only ‘new’
Defendants.” Pl.’s Mot. 2. Plaintiff emphasizes the connection between the leadership of the
various Defendants but does not add any additional facts to overcome the aforementioned
deficiencies. Plaintiff has already identified and brought suit against the appropriate defendants.
For the reasons stated above, any additional defendants who neither own nor manage the
apartment complex cannot be held liable for the actions of the actual owner and manager.
Commonalities in name or management are insufficient.
Because amendment to add new defendants would be futile, Plaintiff’s request is denied.
To the extent that Plaintiff wishes to amend her complaint against the original Defendants, solely
to make the Statement of Facts more clear, that request is granted.
Finally, Plaintiff has also requested that the Court defer the issue until trial. This request
is also denied. The Court has discretion to defer motions pending discovery when necessary.
Murphy v. Schneider Nat’l Inc., 362 F.3d 1133, 1139 (9th Cir. 2004); Fed. R. Civ. P. 12(i)
(motions under 12(b)(2) and 12(b)(6) “must be heard and decided before trial unless the court
orders a deferral until trial.”). However, no amount of discovery will change the ownership or
management of Plaintiff’s apartment complex. Cf. Iqbal, 556 U.S. at 686 (“Because respondent’s
complaint is deficient under Rule 8, he is not entitled to discovery, cabined or otherwise.”).
CONCLUSION
For these reasons, Defendants’ Motion to Dismiss, ECF No. 60, is GRANTED and
Plaintiff’s Motion for Leave to Amend, ECF No. 83, is DENIED.
10 – OPINION AND ORDER
IT IS SO ORDERED.
DATED this 19th day of November, 2020.
____s/Michael J. McShane_________
Michael J. McShane
United States District Judge
11 – OPINION AND ORDER