Stauffer v. Matarazzo

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF OREGON

DAVID WILLIAM STAUFFER, I, and LAURA L. Case No.: 3:23-cv-01136-AN

STAUFFER,

Plaintiffs,

v. OPINION AND ORDER

JUDITH H. MATARAZZO, STATE OF

OREGON COURTS, ANNA K. SORTUN,

TONKON TORP, LLP, and FITBIT, INC.,

Defendants.

Pro se plaintiffs David William Stauffer and Laura Stauffer bring this action against Judith

Matarazzo ("Judge Matarazzo"), the State of Oregon Courts, Anna K. Sortun ("Sortun"), Tonkon Torp,

LLP ("Tonkon Torp"), and Fitbit, Inc. ("Fitbit")1 alleging deprivation of civil rights under 42 U.S.C. § 1983.

Judge Matarazzo and the State of Oregon Courts ("state defendants"), Sortun and Tonkon

Torp ("private attorney defendants"), and Fitbit each separately filed motions to dismiss. After reviewing

the parties' pleadings, the Court finds that oral argument will not help resolve this matter. Local R. 7-1(d).

For the reasons stated herein, the motions to dismiss are granted.

LEGAL STANDARD

A. Federal Rule of Civil Procedure 12(b)(1)

Federal Rule of Civil Procedure 12(b)(1) permits a defendant to move to dismiss an action

for lack of subject-matter jurisdiction. A challenge to subject-matter jurisdiction may be facial, asserting

that the allegations contained in the complaint are insufficient to confer subject-matter jurisdiction, or

factual, challenging the truth of the allegations used to assert subject-matter jurisdiction. Wolfe v.

Strankman, 392 F.3d 358, 362 (9th Cir. 2004). In a facial challenge, the court must take the allegations in

1 In later filings, plaintiffs also refer to defendant Multnomah County. See, e.g., Pls.' Opp'n to Private Att'y Defs.' and

State Defs.' Mots. to Dismiss, ECF [9], at 4. However, Multnomah County was not named as a defendant in the

complaint, and plaintiffs did not subsequently amend the pleadings or join parties.

the complaint as true. Id. The court must dismiss any claims over which it lacks subject-matter jurisdiction.

See Pistor v. Garcia, 791 F.3d 1104, 1111 (9th Cir. 2015).

B. Federal Rule of Civil Procedure 12(b)(6)

To survive a Rule 12(b)(6) motion to dismiss for failure to state a claim, a complaint must

allege "sufficient factual matter, accepted as true, 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));

Fed R. Civ. P. 12(b)(6). A claim is facially plausible "when the plaintiff pleads factual content that allows

the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. The

court "must accept as true all factual allegations in the complaint and draw all reasonable inferences in favor

of the nonmoving party." Retail Prop. Tr. v. United Bhd. of Carpenters & Joiners of Am., 768 F.3d 938,

945 (9th Cir. 2014). Bare assertions that amount to mere "formulaic recitation of the elements" of a claim

"are conclusory and not entitled to be assumed true." Iqbal, 556 U.S. at 681.

In ruling on a (12)(b)(6) motion to dismiss, a court may consider only "allegations

contained in the pleadings, exhibits attached to the complaint, and matters properly subject to judicial

notice." Swartz v. KPMG LLP, 476 F.3d 756, 763 (9th Cir. 2007). A court may also consider "a writing

referenced in a complaint but not explicitly incorporated therein if the complaint relies on the document

and its authenticity is unquestioned." Id.

The court must construe pleadings by pro se plaintiffs liberally and must give them the

benefit of any doubt. Karim-Panahi v. Los Angeles Police Dep't, 839 F.2d 621, 624 (9th Cir. 1988). Before

dismissing a complaint, a court must give a statement of the complaint's deficiencies and must give leave

to amend the complaint unless it is "'absolutely clear'" that the deficiencies could not be cured by

amendment. Id. (quoting Noll v. Carlson, 809 F.2d 1446, 1448 (9th Cir. 1987)).

C. 42 U.S.C. § 1988(b) Attorney's Fees

42 U.S.C. § 1988(b) permits the court, in its discretion, to award the prevailing party in a

42 U.S.C. § 1983 case reasonable attorney's fees. 42 U.S.C. § 1988(b).

A prevailing defendant may only be awarded attorney's fees in exceptional circumstances,

"'upon a finding that the plaintiff's action was frivolous, unreasonable, or without foundation.'" Fox v. Vice,

563 U.S. 826, 833 (2011) (quoting Christiansburg Garment Co. v. Equal Emp. Opportunity Comm'n, 434

U.S. 412, 421 (1978)). The fact that a defendant prevails does not, on its own, automatically support

awarding attorney's fees. Vernon v. City of Los Angeles, 27 F.3d 1385, 1402 (9th Cir. 1994).

Attorney's fees "should rarely be awarded" against pro se plaintiffs, because "[a]n

unrepresented litigant should not be punished for his failure to recognize subtle factual or legal deficiencies

in his claims." Hughes v. Rowe, 449 U.S. 5, 15 (1980). Courts should look for some other factor, such as

repeated attempts by a pro se plaintiff to bring claims previously found to be frivolous, when considering

whether to award attorney's fees against a pro se plaintiff. Miller v. Los Angeles Cnty. Bd. of Educ., 827

F.2d 617, 620 (9th Cir. 1987).

BACKGROUND

Plaintiffs filed a complaint in Multnomah County Circuit Court against Fitbit related to

injuries Laura Stauffer suffered while using a Fitbit activity tracker. Compl., ECF [1], at 4-5. Plaintiffs

demanded a jury trial. Id.

According to plaintiffs, Sortun, an attorney employed by Tonkon Torp, filed "erroneous

court pleadings" that led Judge Matarazzo to refuse to hold a jury trial. Id. 4. Plaintiffs clarify in their

briefing that Sortun filed a motion asking Judge Matarazzo to submit the action to arbitration. Pls.' Opp'n

to Private Att'y Defs.' And State Defs.' Mots. To Dismiss, ECF [9], at 2-3. After three years of arbitration,

plaintiffs allege that arbitration ended "without arbitrating an agreement between the parties," and they

moved Judge Matarazzo to proceed with a jury trial. Id. 3. Sortun asked Judge Matarazzo to dismiss the

case, and she did so over plaintiffs' objections. Id. On June 8, 2022, Judge Matarazzo entered a general

judgment of dismissal. Compl. 4. The Oregon Supreme Court subsequently issued an order denying review

of the matter, while "the appeals court is AWOP [sic]." Id.

Plaintiffs further allege that the "phony non-legal, non-jury, American Arbitration

Association [the "AAA"]," which oversaw arbitration, was not the proper adjudication body. Pls.' Second

Opp'n to Private Att'y Defs.' and State Defs.' Mots. to Dismiss, ECF [17], at 5. After the AAA rendered its

decision, plaintiffs state that Judge Matarazzo was prohibited by law from "learning or reading" the

arbitration award. Id. Despite this, Sortun and Gracie Nagle, counsel for Fitbit, "knowingly submitted" an

unsealed copy of the arbitration award to the court, which Judge Matarazzo read and used as a basis for her

decision to dismiss the action. Id. Plaintiffs state that filing the unsealed arbitration award was a violation

of Oregon Uniform Trial Court Rule 13.260, which requires the sealing of any award if a trial de novo is

requested. Id. Had Judge Matarazzo not read the arbitration decision, plaintiffs argue, she would not have

dismissed the case, denying plaintiffs a jury trial. Id. 6.

Plaintiffs seek reimbursement for medical bills and lost wages related to Laura Stauffer's

injuries, punitive damages to induce Fitbit to remove the activity tracker from sale, and a declaration that

Judge Matarazzo deprived plaintiffs of their right to a jury trial. Compl. 5.

The complaint was filed on August 3, 2023. On August 29, 2023, state defendants and

private attorney defendants filed motions to dismiss. State Defs.' Mot. to Dismiss, ECF [5]; Private Att'y

Defs.' Mot. to Dismiss, ECF [6]. On October 3, 2023, Fitbit filed a motion to dismiss. Fitbit's Mot. to

Dismiss, ECF [20]. Plaintiffs filed numerous oppositions to the motions to dismiss. Pls.' Opp'n to Private

Att'y Defs.' and State Defs.' Mots. to Dismiss, ECF [9]; Pls.' Second Opp'n to Private Att'y Defs.' and State

Defs.' Mots. to Dismiss, ECF [17]; Pls' Third Opp'n to Private Att'y Defs' and State Defs.' Mots. To Dismiss,

ECF [22]; Pls.' Fourth Mem. in Opp'n to Mot. to Dismiss, ECF [23]; Pls.' Fifth Opp'n to Mots. to Dismiss,

ECF [25].

DISCUSSION

A. Federal Rule of Civil Procedure 12(b)(1)

1. Rooker-Feldman Doctrine

State defendants, private attorney defendants, and Fitbit argue that the Court lacks jurisdiction

over this action under the Rooker-Feldman doctrine. State Defs.' Mot. to Dismiss 2-4; Private Att'y Defs.'

Mot. to Dismiss 6-7; Fitbit's Mot. to Dismiss 5-6.

The Rooker-Feldman doctrine, which takes its name from Rooker v. Fid. Tr. Co., 263 U.S.

413, 44 S. Ct. 149, 68 L. Ed. 362 (1923) and D.C. Ct. of Appeals v. Feldman, 460 U.S. 462, 103 S. Ct.

1303, 75 L. Ed. 2d 206 (1983), instructs that federal district courts do not have subject matter jurisdiction

to hear appeals from the state courts. "It is a forbidden de facto appeal under Rooker–Feldman when the

plaintiff in federal district court complains of a legal wrong allegedly committed by the state court, and

seeks relief from the judgment of that court." Noel v. Hall, 341 F.3d 1148, 1163 (9th Cir. 2003).

Plaintiffs allege that Judge Matarazzo erroneously received an unsealed arbitration award

and dismissed their complaint in state court in spite of their wishes to proceed with a jury trial. They

appealed this decision to the state appellate and supreme courts, which affirmed Judge Matarazzo's ruling.

Plaintiffs' appeal of what they allege was a legal wrong committed by the state court is exactly the kind of

action that the Rooker-Feldman doctrine forbids. Accordingly, the Court does not have jurisdiction to hear

claims related to the allegedly erroneous legal rulings in the state court case.

B. Federal Rule of Civil Procedure 12(b)(6)

1. 42 U.S.C. § 1983

a. 42 U.S.C. § 1983 Claim against Private Actors

Private attorney defendants and Fitbit argue that plaintiffs have failed to state a claim

against them because claims brought pursuant to 42 U.S.C. § 1983 cannot be brought against private actors.

Private Att'y Defs.' Mot. to Dismiss 4-6; Fitbit's Mot. to Dismiss 7.

42 U.S.C. § 1983 creates a cause of action for plaintiffs alleging a deprivation of civil rights

by a state actor. To prevail on a 42 U.S.C. § 1983 claim, a plaintiff must demonstrate "(1) that a right

secured by the Constitution or laws of the United States was violated, and (2) that the alleged violation was

committed by a person acting under the color of State law." Long v. Cnty. of Los Angeles, 442 F.3d 1178,

1185 (9th Cir. 2006).

A court must begin with "the presumption that private conduct does not constitute

governmental action." Sutton v. Providence St. Joseph Med. Ctr., 192 F.3d 826, 835 (9th Cir. 1999). For

private conduct to constitute governmental action, the court must find "something more" than simple

reliance by a private person on a rule or law. Id. (quoting Lugar v. Edmondson Oil Co., 457 U.S. 922, 939

(1982) ("Action by a private party pursuant to this statute, without something more, was not sufficient to

justify a characterization of that party as a “state actor.”)). While there is no precise formula for measuring

state action, the Supreme Court instructs that "state action may be found if, though only if, there is such a

'close nexus between the State and the challenged action' that seemingly private behavior 'may be fairly

treated as that of the State itself.'" Brentwood Acad. v. Tennessee Secondary Sch. Athletic Ass'n, 531 U.S.

288, 295 (2001) (quoting Jackson v. Metro. Edison Co., 419 U.S. 345, 351 (1974)).

Private attorney defendants and Fitbit, unlike state defendants, are not governmental actors,

and as such, their private conduct is presumed not to constitute governmental action unless "something

more" is present.

Plaintiffs allege that private attorney defendants, acting as counsel for Fitbit, filed

"erroneous court pleadings" seeking to compel arbitration and dismiss the action. Compl. 4. Plaintiffs do

not allege that private attorney defendants were acting under color of state law or any nexus between private

attorney defendants' conduct and the state. As private actors not acting under color of state law, private

attorney defendants cannot be sued under 42 U.S.C. § 1983. See Simmons v. Sacramento Cnty. Superior

Ct., 318 F.3d 1156, 1161 (9th Cir. 2003) (stating that lawyers in private practice who are not acting under

color of state law cannot be sued under 42 U.S.C. § 1983); Stephens v. Multnomah Cnty., No. 3:11-CV-

01497-MO, 2012 WL 1143586, at *2 (D. Or. Apr. 3, 2012), aff'd (Aug. 8, 2012) (finding that defendant

attorneys were not acting under color of law, and thus not proper defendants in a 42 U.S.C. § 1983 claim,

when their motions to dismiss plaintiff's case in state court were granted).

Plaintiffs' allegations regarding Fitbit relate primarily to injuries caused by Fitbit's

allegedly dangerous fitness trackers that were the subject of the state court litigation. Plaintiffs do not allege

that Fitbit was acting under color of state law or any nexus between Fitbit's actions and the state. For these

reasons, Fitbit is also not a proper defendant under 42 U.S.C. § 1983.

b. Absolute Judicial Immunity

State defendants argue that the claims against them must be dismissed because they are

entitled to absolute judicial immunity. State Defs.' Mot. to Dismiss 4.

Absolute judicial immunity bars suits against judges acting in their official capacity. Olsen

v. Idaho State Bd. of Med., 363 F.3d 916, 922-23 (9th Cir. 2004). It extends to state judges sued under 42

U.S.C. § 1983. Id. "To qualify for judicial immunity, a judge must have performed a 'judicial act' which

was within the scope of his jurisdiction." McGuire v. Clackamas Cnty. Couns., No. 08-CV-1098-AC, 2009

WL 4456310, at *4 (D. Or. Nov. 24, 2009) (quoting Stump v. Sparkman, 435 U.S. 349, 356–57 (1978)).

An act is a judicial act if it is "a function normally performed by a judge and the parties to the act were

dealing with the judge in his judicial capacity." Id. Judges enjoy judicial immunity "even when their

actions are erroneous, malicious, or in excess of judicial authority." Tanner v. Heise, 879 F.2d 572, 576

(9th Cir. 1989).

Plaintiffs allege that Judge Matarazzo read an arbitration award that was supposed to

remain sealed and, as a result, dismissed plaintiffs' state court action, depriving them of the right to a jury

trial. Judge Matarazzo was performing judicial acts when she considered plaintiffs' and Fitbit's motions

and dismissed the state court action. Because Judge Matarazzo was acting in her official capacity, she is

entitled to judicial immunity even if, as plaintiffs allege, her actions were erroneous. Accordingly, Judge

Matarazzo is not subject to suit based on plaintiffs' allegations.

2. Preclusion

State defendants and Fitbit argue that this action is barred on the grounds of claim and issue

preclusion. State Defs.' Mot. to Dismiss 5-6; Fitbit's Mot. to Dismiss 7-9.

28 U.S.C. § 1738, the "full faith and credit" statute, mandates that "a federal court must

give to a state-court judgment the same preclusive effect as would be given that judgment under the law of

the State in which the judgment was rendered." Migra v. Warren City Sch. Dist. Bd. of Educ., 465 U.S. 75,

81(1984). Under the doctrine of claim preclusion, "[a] final judgment on the merits of an action precludes

the parties or their privies from relitigating issues that were or could have been raised in that action."

Federated Dep't Stores, Inc. v. Moitie, 452 U.S. 394, 398 (1981). Claim preclusion applies where: " (1) the

same parties, or their privies, were involved in the prior litigation, (2) the prior litigation involved the same

claim or cause of action as the later suit, and (3) the prior litigation was terminated by a final judgment on

the merits." Cent. Delta Water Agency v. United States, 306 F.3d 938 (9th Cir. 2002) (citing Blonder–

Tongue Laboratories v. University of Ill. Foundation, 402 U.S. 313, 323–24 (1971)). The Ninth Circuit

has explained that "'[t]he central criterion in determining whether there is an identity of claims between the

first and second adjudications is whether the two suits arise out of the same transactional nucleus of facts.'"

Owens v. Kaiser Found. Health Plan, Inc., 244 F.3d 708, 714 (9th Cir. 2001) (quoting Frank v. United

Airlines, Inc., 216 F.3d 845, 851 (9th Cir.2000)) (internal quotation marks and citations omitted).

Issue preclusion, also referred to as collateral estoppel, "is designed to 'bar[ ] successive

litigation of an issue of fact or law actually litigated and resolved in a valid court determination.'" Paulo v.

Holder, 669 F.3d 911 (9th Cir. 2011) (quoting Taylor v. Sturgell, 553 U.S. 880, 892 (2008) (internal

quotation marks omitted)). Because federal courts must give full faith and credit to the state court judgment,

it must apply the relevant state's preclusion law. Marrese v. Am. Acad. of Orthopaedic Surgeons, 470 U.S.

373, 380 (1985). Under Oregon law, previous litigation has issue preclusive effect when five elements are

met:

"(1) the issue in the two proceedings is identical; (2) the issue was actually litigated and

was essential to a final decision on the merits in the prior proceeding; (3) the party sought

to be precluded has had a full and fair opportunity to be heard on that issue; (4) the party

sought to be precluded was a party or was in privity with a party to the prior proceeding;

and (5) the prior proceeding was the type of proceeding to which the state court will give

preclusive effect."

Engquist v. Oregon Dep't of Agric., 478 F.3d 985 (9th Cir. 2007) (quoting Nelson v. Emerald People's Util.

Dist., 318 Or. 99, 104, 862 P.2d 1293 (1993), aff'd sub nom. Engquist v. Oregon Dep't of Agr., 553 U.S.

591, 128 S. Ct. 2146, 170 L. Ed. 2d 975 (2008). In Oregon, issue preclusion applies to matters decided in

arbitration as well those decided in a judicial proceeding. Fairbank v. Underwood, 986 F. Supp. 2d 1222,

1235 (D. Or. 2013) (citing Westwood Const. Co. v. Hallmark Inns & Resorts, Inc., 182 Or.App. 624, 634

n. 7, 50 P.3d 238 (2002), rev. denied, 335 Or. 42, 57 P.3d 581 (2002)).

Plaintiffs are barred by both claim and issue preclusion from re-litigating their claims

before this Court. Although plaintiffs have brought in additional participants as defendants, this claim

includes the same parties from the original state court action, involves the same claim regarding injury

caused by Fitbit's activity tracker, and was terminated by a final judgment on the merits when Judge

Matarazzo dismissed the action based on the binding arbitration result. That final judgment was upheld by

Oregon Court of Appeals and Supreme Court. Although plaintiffs state that they bring a new claim because

they now allege violation of civil rights by parties to the state court proceedings, plaintiffs seek a declaration

that the dismissal of their state court case was wrong and damages related to Fitbit's alleged wrongdoing;

in essence, they seek to relitigate the same claims brought in the state court proceedings. Plaintiffs are,

therefore, barred by claim preclusion from bringing this action.

As to issue preclusion, the underlying issue as to whether Fitbit caused plaintiffs injury by

selling a dangerous activity tracker was actually litigated in the state court action and arbitration. Although

plaintiffs argue that the AAA was not the proper body to hear the dispute and that Judge Matarazzo

erroneously dismissed the action based on the request of Sortun and Fitbit, denying plaintiffs the right to a

jury trial, they had the opportunity to raise these issues in the underlying proceedings. Plaintiffs did, in

fact, challenge the outcome of the case by appealing to the Oregon Court of Appeals and Supreme Court,

but the result was affirmed. Accordingly, plaintiffs' claims are also barred by issue preclusion.

3. Failure to Plead Sufficient Facts

State defendants argue that plaintiffs failed to allege sufficient facts to support their claims.

State Defs.' Mot. to Dismiss 6-7. Specifically, state defendants argue that the claim that Judge Matarazzo's

refusal to assign plaintiffs' case for jury trial violated their constitutional right to a jury trial constitutes a

legal conclusion, unsupported by factual allegations, because "[n]ot every dismissal prior to a jury trial is a

constitutional violation." Id. 6-7.

Construing plaintiffs' allegations liberally, they state that Judge Matarazzo presided over

the state court action, submitted the action to an unjust arbitration, erroneously read an unsealed arbitration

award, and erroneously dismissed the action. As a result, Judge Matarazzo refused to assign the case for a

jury trial in violation of plaintiffs' due process rights. Plaintiffs state that in lieu of a jury trial they were

subjected to arbitration by the "phony non-legal, non-jury, American Arbitration Association," pursuant to

Judge Matarazzo's order. Pls.' Second Opp'n to Private Att'y Defs.' and State Defs.' Mots. to Dismiss, ECF

[17], at 5.

While threadbare legal conclusions are not sufficient to state a claim, here plaintiffs have

made specific factual allegations that, while legally insufficient on other bases, do state a cognizable legal

theory. According to plaintiffs, Judge Matarazzo, despite understanding plaintiffs' right to a jury trial, chose

to submit their claims to "phony" arbitration, then erroneously dismissed the action based on the arbitration

award. While state defendants are correct that not every dismissal violates a constitutional right to a jury

trial, construed liberally, plaintiffs' complaint alleges facts suggesting that Judge Matarazzo wrongfully

dismissed the action, resulting in a denial of due process.

State defendants also argue that plaintiffs fail to plead sufficient facts regarding the State

of Oregon Courts, which is listed as a defendant. State Defs.' Mot. to Dismiss 7. The complaint does not

contain any allegations specific to the State of Oregon Courts, aside from referencing it as Judge

Matarazzo's employer. Plaintiffs do not, however, allege a theory of respondeat superior liability or any

other basis for bringing claims against the State of Oregon Courts. As a result, plaintiffs have failed to

plead sufficient facts to state a claim against the State of Oregon Courts.

4. Eleventh Amendment Immunity

State defendants argue that they are immune to suit under the Eleventh Amendment. State

Defs.' Mot. to Dismiss 7.

The Eleventh Amendment bars citizens from bringing suits against states in federal court.

Micomonaco v. State of Wash., 45 F.3d 316, 319 (9th Cir. 1995). There are two exceptions to this

prohibition: suits are permitted when Congress abrogates the Eleventh Amendment and when a state waives

its immunity and consents to suit. Id. It is "well established" that Eleventh Amendment immunity extends

to agencies of the state. Savage v. Glendale Union High Sch., Dist. No. 205, Maricopa Cnty., 343 F.3d

1036, 1040 (9th Cir. 2003).

The State of Oregon Courts, as an agency of the State of Oregon, is immune to suit under

the Eleventh Amendment unless Congress abrogates that immunity or the state waives it and consents to

suit. Here, the State of Oregon and the State of Oregon Courts have not waived their immunity, and

plaintiffs do not raise any other exception to the Eleventh Amendment. Accordingly, the State of Oregon

Courts is immune from this suit under the Eleventh Amendment.

C. Attorney's Fees

Private attorney defendants and Fitbit request an award of attorney's fees pursuant to 42

U.S.C. § 1988. Private Att'y Defs.’ Mot. to Dismiss 7; Fitbit Mot. to Dismiss 9-10.

Plaintiffs' complaint, which lacks foundation on numerous grounds, is the type for which

prevailing defendants may be awarded attorney fees. However, the Court declines to award attorney fees

in light of plaintiffs' pro se status and in the absence of any additional factors, such as multiple frivolous

actions, weighing in favor of awarding fees. See Stephens v. Multnomah Cnty., No. 3:11-CV-01497-MO,

2012 WL 1143586, at *3 (D. Or. Apr. 3, 2012), aff'd (Aug. 8, 2012) (declining to award fees to prevailing

defendant where plaintiff was proceeding pro se in "her first attempt with these claims.").

CONCLUSION

For the foregoing reasons, the Motions to Dismiss, ECF [5], ECF [6], and ECF [20], are

GRANTED. Plaintiffs' complaint is dismissed with prejudice and without leave to amend because the legal

deficiencies described herein could not be cured via amendment.

IT IS SO ORDERED.

DATED this 30th day of January, 2024. _,

J, “A, bye i | Zaon

United States District Judge

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