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SCHOLL v. MANOR CARE

September 30, 2005.

RICHARD SCHOLL, on behalf of ESTATE OF MILDRED SCHOLL; KATHLEEN LEVIN, on behalf of ESTATE OF KATHLEEN VAN ARUM, and on behalf of all others similarly situated, Plaintiffs,
v.
MANOR CARE, INC.; MANOR CARE OF AMERICA, INC.; MANOR CARE PROPERTIES, INC.; MANOR CARE HEALTH SERVICES, INC., Defendants.



The opinion of the court was delivered by: NAPOLEON JONES, District Judge

ORDER:
(1) DENYING DEFENDANT'S MOTION TO DISMISS UNDER RULE 12(b)(1);
(2) DENYING DEFENDANT'S MOTION TO DISMISS UNDER RULE 12(b)(6);
(3) DENYING DEFENDANT'S MOTION TO DISMISS UNDER RULE 9(b);
(4) GRANTING DEFENDANT'S MOTION TO STRIKE INJUNCTIVE RELIEF; and
(5) STRIKING PARAGRAPHS 90 AND 96(b) OF THE COMPLAINT UNDER RULE 12(f).
Currently before the Court is a Motion to Dismiss ("Motion") under Federal Rules of Civil Procedure 12(b)(1) ("Rule 12(b)(1)"), 12(b)(6) ("Rule 12(b)(6)"), 9(b) ("Rule 9(b)") and a Motion to Strike under 12(f) ("Rule 12(f)") and supporting Memorandum of Points and Authorities in Support thereof filed by Defendant Manor Care, Inc. ("Defendant") [Doc. No. 6.] Plaintiffs Richard Scholl and Kathleen Levin ("Plaintiffs") have filed an Opposition to the Motion. [Doc. No. 10.] Defendant has also filed a Reply. [Doc. No. 14.] For the reasons set forth below, the Court DENIES Defendant's Motion to Dismiss under Rule 12(b)(1), DENIES Defendant's Motion to Dismiss under Rule 12(b)(6); GRANTS Defendant's Motion to Strike injunctive relief, and STRIKES paragraphs 90 and 96(b) of the Complaint.

Background Facts

  Plaintiffs Richard Scholl and Kathleen Levin are individuals residing in San Diego and appearing respectively on behalf of the estates of their mothers, Mildred Scholl and Kathleen Van Arum, as well as on behalf of all others similarly situated. (Complaint, Prayer for Relief.) Defendant Manor Care Health Services, Inc., is a corporation organized and existing under the laws of Delaware with its principal place of business located in Ohio. (Complaint ¶ 6). Defendant Manor Care Health Services, Inc., and affiliated companies Defendants Manor Care, Inc., Manor Care of America, Inc., and Manor Properties, Inc. (collectively, "Manor Care"), own and operate ten facilities in the State of California that treat the elderly. (Complaint ¶ 4).

  Plaintiffs allege that their mothers were subjected to substandard care during their time as residents at Defendant's facility located in Encinitas, California. (Id. ¶ 6). In addition to their personal claims, Plaintiffs also seek to represent a purported class consisting of all persons who resided as patients at the Manor Care skilled nursing facility in Encinitas at any time in the four (4) years preceding the filing of the complaint. (Id. ¶ 77). Specifically, Plaintiffs allege that on a class-wide basis Manor Care has failed to maintain adequate staffing at their Encinitas facility and that as a result, residents have suffered from: (1) pressure sores resulting from staff failure to turn over bedfast residents; (2) incontinence and urinary tract infections resulting from inadequate toileting assistance; (3) falls resulting from the failure to respond to call lights; (4) malnutrition resulting from inadequate feeding assistance and lack of monitoring; and (5) dehydration. (Id. ¶ 4-5). According to Plaintiffs, Defendant misrepresented the level of care, services, and staffing levels to the public in their written marketing materials and admission agreement. (Id. ¶ 10).

  Plaintiffs filed a Complaint in the Superior Court of the State of California that was subsequently removed to this Court on diversity of citizenship grounds under the Class Action Fairness Act. Plaintiffs have alleged the following causes of action against Defendant: (1) unlawful, unfair, and fraudulent business acts and practices in violation of California Business & Professions Code §§ 17200 and 17500 (together, the unfair competition law, "UCL"); (2) false advertising; (3) violation of the Consumer Legal Remedies Act (Cal. Civ. Code § 1750 et seq.); and (4) unjust enrichment. (Complaint ¶¶ 86-106). Defendant now seeks to dismiss the action for: (1) lack of subject matter jurisdiction; (2) failure to state a claim on which relief can be granted; and (3) failure to plead fraud with the requisite particularity. Additionally, Defendant moves to strike Plaintiffs' request for injunctive relief.

  I. Legal Standards

  A. Motion to Dismiss Pursuant to Rule 12(b)(1)

  Under Federal Rule of Civil Procedure Rule 12(b)(1), a defendant may seek to dismiss a complaint for "lack of jurisdiction over the subject matter." Fed.R.Civ.P. 12(b)(1).

  Federal subject matter jurisdiction must have a statutory basis. The primary sources of federal subject matter jurisdiction are federal question jurisdiction under 28 U.S.C. § 1331, diversity jurisdiction under 28 U.S.C § 1332, and supplemental jurisdiction under 28 U.S.C. § 1367.

  When considering a Rule 12(b)(1) motion, the district court "is free to hear evidence regarding jurisdiction and to rule on that issue prior to trial, resolving factual disputes where necessary." Augustine v. United States, 704 F.2d 1074, 1077 (9th Cir. 1983). "In such circumstances, `[n]o presumptive truthfulness attaches to plaintiff's allegations, and the existence of disputed facts will not preclude the trial court from evaluating for itself the merits of jurisdictional claims.'" Id. (quoting Thornhill Publishing Co. v. General Telephone & Electronic Corp., 594 F.2d 730, 733 (9th Cir. 1979)). Plaintiffs, as the party seeking to invoke jurisdiction, have the burden of establishing that jurisdiction exists. See Kokkonen v. Guardian Life Ins. Co. of Am., 114 S. Ct. 1673, 1675 (1994).

  B. Motion to Dismiss Pursuant to Rule 12(b)(6)

  Federal Rules of Civil Procedure Rule 12(b)(6) provides that a complaint may be dismissed for failure to state a claim upon which relief can be granted. Fed.R.Civ.P. 12(b)(6). A Rule 12(b)(6) motion to dismiss tests the sufficiency of the complaint. See Ileto v. Glock, Inc., 349 F.3d 1191, 1199-1200 (9th Cir. 2003). Dismissal of a claim under this rule is appropriate only where it "appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Edwards v. Marin Park, Inc., 356 F.3d 1058, 1061 (9th Cir. 2004), (quoting Conley v. Gibson, 355 U.S. 41, 45-46 (1957)). A complaint may be dismissed as a matter of law for two reasons: (1) lack of a cognizable legal theory, or (2) insufficient facts under a cognizable theory. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001).

  In reviewing the motion, the court must assume the truth of all factual allegations and must construe them in the light most favorable to the nonmoving party. Gompper v. VISX, Inc., 298 F.3d 893, 895 (9th Cir. 2002). However, the court is not bound to accept as true a legal conclusion couched as a factual allegation. Papasan v. Allain, 478 U.S. 265, 286 (1986); see also Western Mining Council v. Watt, 643 F.2d 618, 624 (9th Cir. 1981). Instead, the court must determine "whether conclusory allegations follow from the description of facts as alleged by the plaintiff." Holden v. Hagopian, 978 F.2d 1115, 1121 (9th Cir. 1992).

  When ruling on a motion to dismiss, the court may consider the facts alleged in the complaint, documents attached to the complaint, and documents relied upon but not attached to the complaint when authenticity is not contested. Parrino v. FHP, Inc., 146 F.3d 699, 705-06 (9th Cir. 1998); Fed.R.Civ.P. 12(b)(6).

  C. Motion to Strike Pursuant to Rule 12(f)

  Federal Rules of Civil Procedure Rule 12(f) provides that the court may strike from any pleading "any insufficient defense or any redundant, immaterial, impertinent, or scandalous matter." Fed.R.Civ.P. 12(f). Immaterial matter is material "which has no essential or important relationship to the claim for relief." Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1527 (9th Cir. 1993), rev'd on other grounds by 510 U.S. 517 (1994). Impertinent material "consists of statements that do not pertain, and are not necessary, to the issues in question." Id.

  For purposes of the motion to strike, the court "must view the pleading under attack in the light more favorable to the pleader." Lazar v. Trans Union LLC, 195 F.R.D. 665, 669 (C.D. Cal. 2000); see also California v. United States, 512 F. Supp. 36, 39 (N.D. Cal. 1981). Because striking a portion of a pleading is a drastic remedy, Rule 12(f) motions are disfavored and infrequently granted. Lazar, 195 F.R.D. at 669. For a motion to strike to succeed, the movant must show that the allegations objected to are "so unworthy of any consideration . . . that their presence in the pleading throughout the proceedings will be prejudicial to the moving party." 5A Wright & Miller, Federal Practice and Procedure § 1380 (2d ed. 1990). Motions to strike based on impertinent or immaterial matters are usually denied unless "the allegations have no possible relation to the controversy." Id. § 1382.

  Discussion

  I. 12(b)(1) Motion to Dismiss

  Under Rule 12(b)(1), Defendant moves to dismiss Plaintiff's Complaint on the grounds of (1) the primary jurisdiction doctrine and (2) lack of standing. For the reasons set forth below, this Court DENIES Defendant's Motion on both grounds.

  A. Primary Jurisdiction

  Defendant argues that the doctrine of primary jurisdiction requires this Court to decline jurisdiction over any alleged incidents or complaints that have not first been reviewed by the California's Department of Health Services ("CDHS") and the federal government's Center for Medicare and Medicaid ("CMS"). (Def.'s Mem. of P. and A. at 2-3.) Plaintiffs contend that invoking the doctrine is improper. For the reasons stated below, this Court FINDS that it has jurisdiction over each of Plaintiffs' causes of action.

  1. Background on Primary Jurisdiction Doctrine

  The Supreme Court has spoken on the issue of primary jurisdiction:
"The doctrine of primary jurisdiction . . . is concerned with promoting proper relationships between the courts and administrative agencies charged with particular regulatory duties. "Primary jurisdiction," . . . applies where a claim is originally cognizable in the courts, and comes into play whenever enforcement of the claim requires the resolution of issues which, under a regulatory scheme, have been placed within the special competence of an administrative body; in such a case the judicial process is suspended pending referral of such issues to the administrative body for its views . . . No fixed formula exists for applying the doctrine of primary jurisdiction. In every case the question is whether the reasons for the existence of the doctrine are present and whether the purposes it serves will be aided by its application in the particular litigation." United States v. Western Pac. R. Co., 352 U.S. 59, 63-64 (1956). The Court also suggested that two reasons for invoking the doctrine are (1) to promote uniform application of regulatory laws by having agencies initially resolve certain administrative questions and (2) to utilize the expert and specialized knowledge of the agencies involved in matters not within the conventional experience of judges. Id. at 64.
  The Ninth Circuit has also addressed this doctrine. In Brown v. MCI Worldcom Servs., Inc., 277 F.3d 1166, 1169 (9th Cir. 2002), the plaintiff filed a ...

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