United States District Court, S.D. California
ORDER: (1) GRANTING IN PART AND DENYING IN PART DEFENDANTS NI, WESTERN, AND ABLE'S MOTION TO DISMISS (2) GRANTING DEFENDANT FRESH START'S MOTION TO DISMISS THE FIFTH CLAIM FOR RELIEF [Docket Nos. 6, 11]
ROGER T. BENITEZ, District Judge.
Defendants Narconon International ("NI"), Association for Better Living and Education International ("ABLE"), and Narconon Western United States ("Western") (collectively "Defendants") move to dismiss Plaintiffs' Complaint for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6). (Docket No. 6.) Defendants assert that the allegations of the Complaint are not sufficient to establish an agency relationship between Defendants and Defendant Narconon Fresh Start ("Defendant Fresh Start"). Defendant Fresh Start separately moves to dismiss Plaintiffs' fifth claim for damages under 18 U.S.C. § 2520 for violations of 18 U.S.C. § 2511, the federal wiretapping statute. (Docket No. 11.) Both motions are fully briefed.
The Complaint alleges that Plaintiff Deanna Tetreau, while looking for an alcohol rehabilitation facility for her daughter, Plaintiff Jennifer Henning, found a website advertising dependency rehabilitation services. (Compl. ¶¶ 16-17.) She called a number on the site, left a message, and received a return phone call that day. (Compl. ¶ 17.) The caller indicated he was a drug rehabilitation counselor and directed Tetreau to another representative, Josh Penn, that made specific representations about the treatment that would be provided at Fresh Start, including that Fresh Start's program was scientifically proven and had a 70-80% success rate, that Henning would be under the care of a doctor or nurse at all times, that extensive drug and addiction counseling would be provided, and that staff was trained to treat people with addiction. (Compl. ¶¶ 18-20.) The representative directed Tetreau to Fresh Start's website which also claimed a 70-80% success rate. (Complaint ¶ 20.) NI claims a 76% success rate for all its centers, including Fresh Start, despite no published studies or other evidence supporting these rates. (Compl. ¶¶ 44, 46.) The Complaint also alleges that NI has advised some centers not to claim this rate because there is no scientific evidence to support it. (Compl. ¶ 48.)
The Complaint also alleges that these calls were recorded without Tetreau's consent and were used for further study, including high pressure and deceptive sales techniques. (Compl. ¶¶ 115, 118, 120.)
Based on the representations made, Tetreau entered into a contract for treatment for her daughter at Fresh Start and paid $34, 000. (Compl. ¶¶ 21, 24.) Henning entered the program. (Compl. ¶ 24.) The contract described the Narconon Program, used by Fresh Start, as being based on a book by L. Ron Hubbard, but being secular. (Compl. ¶¶ 21-23, 25.)
The Complaint alleges that the program, regardless of the individual's addiction, consists of eight Hubbard Scientology books containing almost no information about substance abuse treatment and a sauna and vitamin program called the "New Life Detoxification Program." (Compl. ¶¶ 21, 24.) Henning's program consisted only of Scientology teachings and practices, including, sitting for hours on end asking another patient "Do fish swim?" (Compl. ¶¶ 32-33.) Henning's progress was evaluated using the "Oxford Capacity Analysis" with questions unrelated to substance abuse. (Compl. ¶¶ 34-35.) Henning never received counseling, was never asked about substance abuse at all, and never received any education on substance abuse. (Compl. ¶¶ 59-61.)
Henning was also allegedly subjected to a daily sauna program called "New Life Detoxification, " identical to a Scientology practice, that attempts to flush drug residue from fatty tissue by having individuals exercise vigorously, ingest high doses of Niacin and a "vitamin bomb" upon entering the sauna, and then spend five hours in the sauna at high temperatures. (Compl. ¶¶ 37-40.) No medical personnel supervised Henning's sauna program. (Compl. ¶ 39.) The Fresh Start facility was staffed by recent patients. (Compl. ¶ 58.) Henning was ultimately unable to complete the program because the high doses of Niacin caused acute pancreatitis requiring transportation to an emergency room for care. (Compl. ¶ 61.)
Generally, the Complaint alleges that NI, Western, and ABLE are all principals of Defendant Fresh Start. (Compl. ¶ 83.) The allegations of the Complaint assert that ABLE is at the top, overseeing drug rehabilitation, education, and criminal justice activities of the Church of Scientology, including Fresh Start and NI. (Compl. ¶ 6.) This includes controlling its agents, NI and Fresh Start, by inspecting Fresh Start centers and creating and approving all marketing materials. (Compl. ¶¶ 8-9.) The same is alleged as between Western and Fresh Start. (Compl. ¶ 5.)
The Complaint alleges more specifically that NI, ABLE, and Western govern and control nearly every aspect of Fresh Start's activities. (Compl. ¶ 64.) Numerous specific examples are alleged. NI publishes operations manuals that direct how Fresh Start must be operated. (Compl. ¶¶ 65-66.) The manuals reflect detailed control over day-to-day matters, including obtaining approval from NI to demote, transfer or dismiss an employee. (Compl. ¶ 66.) Employees are required to report any misconduct to NI and Western and NI and Western then investigate all complaints at Fresh Start. (Compl. ¶¶ 68-69.) NI receives 10% of weekly gross income from Fresh Start to maintain a "building account fund" subject to NI's control. (Compl. ¶¶ 70, 74.) Western also receives a percentage of Fresh Start's gross income. (Compl. ¶ 75.) Fresh Start is required to send detailed weekly statistical reports to NI and Western. (Compl. ¶ 71.)
NI, Western, and ABLE must also approve all promotional and advertising materials, conduct inspections of Fresh Start, direct the details of services provided by employees, provide assistance with legal matters and complaints, and generally micromanage activities down to the books in the Fresh Start bookstore. (Compl. ¶¶ 72-73, 76, 78.) NI and ABLE also publish the training manuals for Fresh Start. (Compl. ¶ 77.)
Defendants move to dismiss under Rule 12(b)(6) arguing that the Complaint lacks sufficient allegations of an agency relationship between Defendants and Defendant Fresh Start. Defendants argue that absent sufficient allegations of agency, the Complaint otherwise fails to state a claim against them. Defendant Fresh ...