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Louie v. BFS Retail and Commercial Operations

November 9, 2009


APPEAL from a judgment of the Superior Court of Sacramento County, Loren E. McMaster, Judge. Reversed. (Super. Ct. No. 34200800006426).

The opinion of the court was delivered by: Sims, Acting P. J.


Plaintiff George Louie seeks damages against defendant BFS Retail and Commercial Operations, LLC (BFRC) for alleged violation of California‟s Disabled Persons Act (Civ. Code, § 54 et seq.*fn1 (DPA)), because the countertops in BFRC‟s business establishments were allegedly too high to allow wheelchair access. The trial court entered judgment of dismissal upon BFRC‟s demurrer, concluding res judicata barred this lawsuit based on a consent decree in a class action lawsuit against BFRC in the United States District Court in Florida, which alleged BFRC‟s facilities denied equal access to disabled persons in violation of the federal ADA (42 U.S.C. § 12101 et seq.). We shall conclude that, because the Florida federal case was resolved by a consent decree expressly reserving any damage claims, res judicata does not bar this claim for damages. We shall therefore reverse the judgment of dismissal.*fn2


The pleading at issue in this appeal is plaintiff‟s "FIRST AMENDED COMPLAINT FOR DAMAGES," filed May 12, 2008, which asserted one cause of action for violation of sections 54 and 54.1 (fn. 1, ante). According to the allegations (which we accept as true for purposes of reviewing the ruling on demurrer):

BFRC owns and operates tire and automotive retail and service centers at seven specified addresses in Sacramento, Carmichael, North Highlands, Citrus Heights, Rancho Cordova, and Roseville. Plaintiff, who resides in West Sacramento, is an amputee who has required the use of a wheelchair as his primary means of mobility outside of his home. In the year preceding the filing of this action, plaintiff patronized defendant‟s facilities at least 17 times. "During said visits to the facilities while using his wheelchair, Plaintiff was unable to use [BFRC‟s] service counters because their countertops were too high for him to be of any use and were therefore inaccessible to him and any person who is wheelchair-bound." Providing wheelchair-accessible counters would have been easy and inexpensive.

The "PRAYER" of the complaint asked for "damages, attorney fees and costs, and all other relief that the Court may deem proper."

BFRC demurred on the ground the lawsuit was barred by res judicata pursuant to a prior class action lawsuit against BFRC in the United States District Court in Florida, which resulted in a final judgment and consent decree covering BFRC‟s stores nationwide, including California. BFRC requested and was granted judicial notice of court documents in the federal case -- American Disability Association, Inc. v. BFS Retail and Commercial Operations, LLC, No. 01-6529 (S.D. Fla. Oct. 30, 2002). Although the federal complaint was not part of our record on appeal, we have obtained the federal complaint and (after having given notice to the parties) we now take judicial notice of it.

Plaintiff here asserts (without evidence at this demurrer stage) that he was not given notice of the federal case. For purposes of this appeal, it does not matter whether or not plaintiff was aware of the federal case while it was pending.

Among the documents of which the trial court took judicial notice, is a "JOINT MOTION FOR ORDER GRANTING PRELIMINARY APPROVAL OF PROPOSED CONSENT DECREE; FOR CONDITIONALLY CERTIFYING THE SETTLEMENT CLASS; FOR DIRECTING NOTICE TO THE CLASS; AND FOR SCHEDULING FAIRNESS HEARING WITH SUPPORTING MEMORANDUM OF LAW." The joint motion, signed by BFRC‟s attorney, repeatedly said the consent decree would not release any claim for damages. Thus, in summarizing the proposed settlement, the joint motion said, "The release, by the defined settlement class shall include a release of all claims asserted in the lawsuit, past and/or present, and all causes of action, actions, complaints or liabilities of every kind for injunctive relief, declaratory relief and attorneys' fees, whether based on Title III of the ADA or state or local law, rule or regulation.

The release does not include claims for individual damages, that otherwise might be available under state law or local ordinance." (Italics added.) Additionally, the joint motion, in arguing that the proposed form of notice to absent class members was adequate due to impracticability of individual notice, said: "There are no individual damage claims affected by this settlement."

The proposed form of notice was (1) posting notice in BFRC stores; (2) publication in a national newspaper, U.S.A. Today; (3) mailing notice to prominent disability groups (including two in California -- one in Los Angeles and one in Berkeley); (4) attempting to post notice on at least five Internet locations frequented by the disabled; and (5) via notice, directing inquiries to the website of plaintiff‟s counsel. The notice to disability groups said the proposed consent decree "will ensure that BFRC Stores are accessible to persons with disabilities as required by the ADA and local accessibility laws." The notice also said, "all Class members will be bound by [the consent decree‟s] provisions" if the court gave final approval, and anyone who objected to the settlement, a copy of which was available on a website, had to send a written statement of reasons for objecting.

The Florida federal court‟s October 30, 2002, "FINAL JUDGMENT APPROVING CLASS CERTIFICATION AND PROPOSED AMENDED CONSENT DECREE AND DISMISSING ACTION WITH PREJUDICE" expressly stated that the proposed form of notice sufficed because no damages were sought and the court was certifying the class under Federal Rules of Civil Procedure, rule 23(b)(2) (undesignated rule references are to the Federal Rules of Civil Procedure), which allows a class action without notice to class members if prerequisites are satisfied and "the party opposing the class has acted or refused to act on grounds that apply generally to the class, so that final injunctive relief or corresponding declaratory relief is appropriate respecting the class as a whole . . . ." The federal court said, "The Proposed Amended Consent Decree meets [rule 23](b)(2)‟s strictures because the relief sought in this action is purely injunctive and declaratory. . . . [P]laintiff and plaintiff class are seeking purely injunctive relief to remedy BFRC‟s alleged non-compliance with Title III which is a federal civil rights statute." The federal court judgment stated in a footnote: "The Proposed Amended Consent Decree reflects the deletion of damage claims that the parties voluntarily excised from the Proposed Consent Decree in August, 2002, after discussions with all of the then objectors." The federal court observed the only objections came from a group of agencies who complained about the use of tolerances for new construction and alterations.

The federal court in Florida, after finding the settlement fair and reasonable, ordered and adjudged that the settlement class was certified, the proposed consent decree was approved and adopted as the order of the court, and the federal court retained jurisdiction pursuant to the terms of the consent decree for enforcement purposes and determination of fees and costs.

The consent decree approved by the federal court limited itself to injunctive relief, declaratory relief, and attorney fees, stating:


"23.1 Release and Discharge. Effective on the date of Final Approval, Plaintiff, on behalf of itself and all members of the Settlement Class, and their spouses or partners, executors, representatives, heirs, successors and assigns, in consideration of the relief set forth herein, the sufficiency of which is expressly acknowledged, fully and finally releases and forever discharges BFRC and the Independent Dealers covered by this Decree and each of their respective [agents, etc.]. Nothing herein limits the enforcement of Settlement Class members‟ rights through administrative or law enforcement agencies.

"23.2 Released Claims. The Released Claims are all claims asserted by named Plaintiff and/or the Settlement Class in the lawsuit or which could be asserted by them during the Term of this Decree,*fn3 any and all past and/or present claims, rights, demands, charges, complaints, actions, causes of action, obligations, or liabilities of any and every kind, known or unknown, for injunctive or declaratory relief or attorneys' fees, based upon Title III of the ADA and its promulgated rules and regulations relating to or concerning access for persons with Mobility Disabilities and dexterity disabilities at the BFRC Retail Tire and Service Stores covered by this Decree.*fn4

Released Claims also include claims regarding Accessibility Enhancements and the elements of BFRC Retail Tire and Service Stores affected thereby that arise during the term of this Decree. To the extent permitted by law, the final entry of this Decree will be fully binding and effective for purposes of res judicata and collateral estoppel upon BFRC, Plaintiff and the Settlement Class with respect to Title III of the ADA and its promulgated rules and regulations concerning access for persons with Mobility disabilities and dexterity disabilities covered by Title III of the ADA at BFRC Retail Tire and Service Stores. Nothing in this section, however, will prevent Class Counsel from enforcing this Decree." (Italics added.)

In further support of the demurrer in the current case, BFRC requested and was granted judicial notice of documents reflecting plaintiff first tried to litigate this case in federal court in California, without success. Thus, on October 31, 2007, plaintiff filed a complaint in the Eastern District of California -- Louie v. BFS Retail and Commercial Operations, L.L.C., (E.D. Cal. Feb. 28, 2008, No. CIV S-07-2340 WBS KJM) U.S.Dist. Lexis 22617 (Louie)) -- seeking to prosecute as a class action a complaint for damages and injunctive relief against BFRC for alleged failure to provide full and equal access to individuals with disabilities in violation of the ADA, the Unruh Civil Rights Act (§ 51) and the DPA (§§ 54-55). On February 28, 2008, the Eastern District of California dismissed the ADA claim with prejudice, on the ground of res judicata in that it was barred by the federal court case in Florida. The Eastern District observed, "plaintiff appropriately acknowledges his membership in the aforementioned "settlement class‟ [fn. omitted] and thus concedes that the Consent Decree bars his ADA claim. (See Pl.‟s Mem. in Opp‟n to Def.‟s Mot. to Dismiss ("Plaintiff ...

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