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Lake v. Ohana Military Communities, LLC

United States District Court, D. Hawaii

May 31, 2019

KENNETH LAKE, CRYSTAL LAKE, HAROLD BEAN, MELINDA BEAN, KYLE PAHONA, ESTEL PAHONA, TIMOTHY MOSELEY, ASHLEY MOSELEY, RYAN WILSON, and HEATHER WILSON, Plaintiffs,
v.
OHANA MILITARY COMMUNITIES, LLC, FOREST CITY RESIDENTIAL MANAGEMENT, INC., DOE DEFENDANTS 1-10, Defendants.

          ORDER DENYING PLAINTIFFS' MOTION FOR CLASS CERTIFICATION

          LESLIE E. KOBAYASHI, UNITED STATES DISTRICT JUDGE.

         On March 22, 2019, Plaintiffs Kenneth Lake, Crystal Lake, Harold Bean, Melinda Bean, Kyle Pahona, Estel Pahona, Timothy Moseley, Ashley Moseley, Ryan Wilson, and Heather Wilson (“Plaintiffs”) filed their Motion for Class Certification (“Motion”).[1] [Dkt. no. 127.] On April 2, 2019, the Court issued an Order to Show Cause (“OSC”), requiring Plaintiffs to file a response showing why the Motion should not be summarily denied. [Dkt. no. 131.] Plaintiffs filed their response to the OSC (“OSC Response”) on April 12, 2019. [Dkt. no. 134.] The Court finds this matter suitable for disposition without a hearing pursuant to Rule LR7.2(d) of the Local Rules of Practice of the United States District Court for the District of Hawai`i (“Local Rules”). On April 16, 2019, this Court issued an entering order informing the parties of its ruling on the Motion. [Dkt. no. 135.] The instant Order supersedes that entering order. Plaintiffs' Motion is hereby denied for the reasons set forth below.

         BACKGROUND

         Plaintiffs Kenneth Lake, Crystal Lake, Harold Bean, Melinda Bean, Kyle Pahona, Estel Pahona, Timothy Moseley, and Ashley Moseley filed their Complaint in state court on September 14, 2016. [Notice of Removal, filed 10/13/16 (dkt. no. 1), Decl. of Christine A. Terada, Exh. 1.] Ryan Wilson and Heather Wilson were added as plaintiffs when the First Amended Complaint was filed on September 20, 2017. [Dkt. no. 75.] The First Amended Complaint remains the operative pleading.

         Plaintiffs are current or former residents of housing at Kaneohe Marine Corps Base Hawaii (“MCBH”). The crux of Plaintiffs' claims is that the soil in some of the residential neighborhoods at MCBH is contaminated, and Defendants Ohana Military Communities, LLC (“Ohana”) and Forest City Residential Management, LLC (“Forest City” and collectively, “Defendants”) failed to: 1) perform adequate remediation measures; and 2) disclose the contamination to Plaintiffs. Plaintiffs allege they were all exposed to the contaminated soil because the soil in their respective MCBH neighborhoods was contaminated and/or they routinely visited, and traveled through, neighborhoods with contaminated soil.

         The First Amended Complaint alleges the following claims: breach of contract against Ohana (“Count I”); breach of the implied warranty of habitability against Ohana (“Count II”); a Haw. Rev. Stat. Chapter 521 claim against Defendants (“Count III”); an unfair and deceptive acts or practices (“UDAP”) claim against Defendants (“Count IV”); a negligent failure to warn claim against Defendants (“Count V”); a negligent infliction of emotional distress claim and an intentional infliction of emotional distress claim against Defendants (“Count VI”); a fraud claim against Defendants (“Count VII”); a negligent misrepresentation claim against Defendants (“Count VIII”); an unfair methods of competition (“UMOC”) claim against Defendants (“Count IX”); a trespass claim against Defendants (“Count X”); and a nuisance claim against Defendants (“Count XI”). Counts IV and IX were stricken because this Court previously dismissed Plaintiffs' UDAP and UMOC claims with prejudice. [Order Granting in Part and Denying in Part Defs.' Motion to Dismiss and/or Strike Pltfs.' First Amended Complaint [Dkt 75], filed 5/31/18 (dkt. no. 98) (“5/31/18 Order”), at 6.[2] Count X was stricken because Plaintiffs failed to seek leave to amend that claim. 5/31/18 Order, 2018 WL 2449188, at *3 (citing dkt. no. 81). The portion of Count III based on Haw. Rev. Stat. § 521-42(a)(1) was dismissed with prejudice, id. at *7, as were Harold Bean and Melinda Bean's and Timothy Moseley and Ashley Moseley's claims in Count XI, id. at *10. All other claims in the First Amended Complaint remain. See id.

         Plaintiffs do not dispute that the First Amended Complaint does not plead this case as a class action, nor does it contain class allegations. In spite of the lack of class allegations, the instant Motion asks this Court to certify the following damages class, pursuant to Fed.R.Civ.P. 23(b)(3): “All persons who leased or resided in residential properties leased from Ohana Military Communities, LLC, at Marine Corps Base Hawaii (‘MCBH') in Kaneohe, Oahu, Hawaii, between 2006 to present.” [Motion at iii.]

         STANDARD

         To the extent that Plaintiffs propose to convert this case into a class action, they seek to expand the scope of the case to assert the claims of, and to seek relief on behalf of, persons who are not identified as plaintiffs in the First Amended Complaint. Thus, as to the proposed class members, the First Amended Complaint is not “a short and plain statement of the claim showing that the pleader is entitled to relief, ” nor does it include “a demand for the relief sought.” See Fed.R.Civ.P. 8(a)(1)-(2). The Motion is therefore construed as a motion for leave to file a second amended complaint, [3] which would plead the case as a class action.

         The following standards apply to a motion for leave to file an amended complaint:

Rule 15(a) of the Federal Rules of Civil Procedure states that leave to amend a complaint should be freely given “when justice so requires.” Fed.R.Civ.P. 15(a)(2). In determining whether to allow amendment of a complaint, courts consider factors such as: whether the amendment will cause undue delay; whether the movant has demonstrated bad faith or a dilatory motive; whether the amendment will unduly prejudice the opposing party; whether amendment is futile; and whether the movant has repeatedly failed to cure deficiencies. See Foman v. Davis, 371 U.S. 178, 182 (1962). . . .

Gilliam v. Glassett, CIVIL NO. 18-00317 SOM/RLP, 2019 WL 475008, at *1 (D. Hawai`i Feb. 6, 2019).

         DISCUSSION

         Plaintiffs had notice that they had to satisfy the standards summarized in Gilliam. [OSC at 2.] Plaintiffs' OSC Response, ...


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