Number range CHAPTERRALPH F. BOYD, JR.

Assistant Attorney General

Civil Rights Division

JOHN S. GORDON

United States Attorney

JOHN L. WODATCH, Chief

RENEE M. WOHLENHAUS, Deputy Chief

Disability Rights Section

LEON M. WEIDMAN

Assistant United States Attorney

MICHELE MARCHAND

Assistant United States Attorney

California Bar No. 93390

Room 7516, Federal Building

300 North Los Angeles Street

Los Angeles, California 90012

Telephone: (213) 894-2727

Facsimile: (213) 894-7819

GRETCHEN E. JACOBS

PHYLLIS M. COHEN

KATHLEEN S. DEVINE

DOV LUTZKER

KRISTAN S. MAYER

JOSEPH C. RUSSO

Trial Attorneys

U.S. Department of Justice

Civil Rights Division

950 Pennsylvania Avenue, N.W.

1425 N.Y. Avenue Building

Disability Rights Section

Washington, D.C. 20530

Telephone: (202) 514-9584

Facsimile: (202) 616-6862

Counsel for Plaintiff

United States of America

IN THE UNITED STATES DISTRICT COURT

FOR THE CENTRAL DISTRICT OF CALIFORNIA

UNITED STATES OF AMERICA, ) Case No.: CV-99-01034-FMC (SHx)

)

Plaintiff, ) PLAINTIFF UNITED STATES'

) MEMORANDUM IN SUPPORT OF

) MOTION FOR PARTIAL SUMMARY

v\. ) JUDGMENT ON DEFENDANTS'

) AFFIRMATIVE DEFENSES

)

AMC ENTERTAINMENT, INC., )

[et]{.underline} [al]{.underline}., ) JUDGE: Hon. Florence Marie Cooper

) DATE: October 21, 2002

) TIME: 10:00 a.m.

Defendants. )

)

**TABLE OF CONTENTS**

I. PRELIMINARY STATEMENT 1

II. FACTUAL AND STATUTORY BACKGROUND 1

> A. Americans with Disabilities Act 1
>
> B. AMC Litigation: Factual and Procedural Summary 2
>
> C. AMC's Texas Action: Redux of APA Claims 5

III\. ARGUMENT: AMC'S VARIOUS AFFIRMATIVE DEFENSES FAIL LEGAL
REQUIREMENTS ON VARIOUS GROUNDS AND\
SHOULD BE DISMISSED 6

> A. Summary Judgment Standard 6
>
> B. Preclusion and Law of the Case Principles Bar AMC From\
> Asserting Its APA-Based Defenses In this Action (Affirmative\
> Defense Nos. 2, 18-22) 7

C. AMC Fails to Carry Its Heavy Burden of Demonstrating That the\
Requisite Exceptional Circumstances Exist to Support an Equitable\
Estoppel Claim Against the Federal Government\
(Affirmative Defense Nos. 3, 5, 24) 11

D. United States Has Not Expressly or Impliedly Waived Its\
Claims Against AMC (Affirmative Defenses Nos. 4, 13) 14

E. United States' Position In This Case Is Entirely Consistent\
With Positions It Has Taken In All Other Stadium-Style Theater Cases\
(Affirmative Defense No. 6) 16

F. Statutes of Limitations and/or Laches Do Not Run Against\
the United States When Enforcing the Public Interest\
(Affirmative Defense Nos. 7 & 8) 18

G. United States Is Not Precluded From Bringing This Action\
By Either The Doctrine of Collateral Estoppel or Res Judicata\
(Affirmative Defense No. 9) 21

> 1\. Collateral Estoppel 21
>
> 2\. Res Judicata 23

H. Damages and Civil Penalties Sought In This Action Are Not Subject To\
Mitigation (Affirmative Defense No. 10) 24

I. AMC Is Independently Liable For Its Failure To Comply With The ADA\
Regardless of Any Negligence of Third-Party Architects or Contractors\
(Affirmative Defense No. 11) 26

J. AMC's Alleged Compliance with State or Local Building Codes\
Is Irrelevant to Its Compliance with the ADA\
(Affirmative Defense No. 12) 29

K. United States Is Authorized Under the Americans With Disabilities
Act\
to Bring This Lawsuit Against AMC, and Has Satisfied All Jurisdictional\
Requirements (Affirmative Defense Nos. 17 & 25) 30

L. The United States Is Not Barred From Litigating This Case Under the\
Doctrine of Unclean Hands (Affirmative Defense No. 23) 32

III. CONCLUSION 34

[I. PRELIMINARY STATEMENT]{.underline}

The United States moves pursuant to Rule 56(c) of the Federal Rules of
Civil Procedure for partial summary judgment on defendants', AMC
Entertainment, Inc. and American Multi-Cinema, Inc. (hereinafter
collectively referred to as "AMC"), Affirmative Defense Nos. 2-13, and
17-25 on the grounds that these defenses are not supported by the law or
facts of this case and, therefore, are now appropriate for summary
judgment. In response to the United States' Complaint against AMC for
violations of Title III of the Americans with Disabilities Act ("ADA"),
42 U.S.C. § 12101 *et seq.*, in the design, construction, and operation
of its stadium-style theaters, AMC filed an Answer in which it asserted
twenty-six affirmative defenses, twenty-one of which are at issue in
this motion. ([See]{.underline} Answer, Affirmative Defenses &
Countercl. (Jury Trial Demanded)(filed April 13, 1999)(Docket \#
5)(respectively "Answer" or "Counterclaim").) These twenty-one
affirmative defenses are littered with boilerplate defenses, legally
deficient defenses, and defenses wholly lacking in factual support.
Specifically, AMC's APA-based affirmative defenses (Affirmative Defense
Nos. 2, 18-22) should be dismissed because they are barred by law of the
case principles and the doctrine of collateral estoppel. Moreover, AMC's
equitable estoppel, judicial estoppel, waiver, laches, jurisdiction,
mitigation and unclean hands defenses (Affirmative Defense Nos. 3-7,10,
13, 17, 23-25) lack any factual support. Finally, AMC's statute of
limitations, collateral estoppel, res judicata, third party negligence,
and privilege defenses (Affirmative Defense Nos. 8-9, 11-12) fail, as a
matter of law, to state legally viable defenses. Accordingly, the United
States' motion for partial summary judgment regarding AMC's affirmative
defenses should be granted.

[II. FACTUAL AND STATUTORY BACKGROUND]{.underline}

> **A. [Americans With Disabilities Act]{.underline}**

Congress enacted the ADA in 1990 to remedy pervasive and continuous
discrimination against persons with disabilities. [See]{.underline} 42
U.S.C. § 12101(a)-(b); [see]{.underline} [generally]{.underline} [PGA
Tour, Inc. v. Martin]{.underline}, 532 U.S. 661, 674-77, 121 S. Ct.
1879, 1889-1890 (2001). Of particular relevance to this action, Title
III of the ADA expressly prohibits disability-based discrimination by
public accommodations and commercial facilities. [See]{.underline} 42
U.S.C. §§ 12181-12189. More specifically, Title III requires so-called
"newly constructed" public accommodations ([i.e]{.underline}. - covered
facilities designed or constructed for first occupancy after January 26,
1993) to be "readily accessible to and usable by" persons with
disabilities. [See]{.underline} 42 U.S.C. § 12183(a)(1);
[see]{.underline} [also]{.underline} [id]{.underline} at § 12182(a)
(forbidding disability-based discrimination "in the full and equal
enjoyment of the goods, services, facilities, privileges, advantages, or
accommodations of any place of public accommodation"). Movie theaters
\-- such as the theaters owned or operated by the AMC defendants \-- are
expressly encompassed within Title III's non-discrimination mandate.
[Id]{.underline}. at § 12181(7)(C) (defining the term "public
accommodation" to include "a motion picture house, theater, concert
hall, stadium, or other place of exhibition or entertainment").

Congress granted primary enforcement authority of Title III of the ADA
to the United States Department of Justice \[hereinafter \"Department\"
or "DOJ"), including the responsibility for promulgating regulations,
issuing technical assistance materials, and filing lawsuits in federal
court to enforce compliance with the statute and accompanying
regulations. 42 U.S.C. §§ 12186(b), 12206, 12188(b). In 1991, pursuant
to this regulatory authority, the Department issued final regulations to
govern new construction of, and alterations to, Title III-covered
facilities. [See]{.underline} 28 C.F.R. §§ 36.101 - 36.608 & App. A;
[see]{.underline} [also]{.underline} 56 Fed. Reg. 35,546 (July 26,
1991). One of these regulations is Standard 4.33.3, which governs the
placement and location of wheelchair and companion seats in public
assembly areas such as movie theaters. Standard 4.33.3 provides, in
pertinent part, that

> \[w\]heelchair areas shall be an integral part of any fixed seating
> plan and shall be provided so as to provide people with physical
> disabilities a choice of admission prices and lines of sight
> comparable to those for members of the general public. They shall
> adjoin an accessible route that also serves as a means of egress in
> case of emergency. At least one companion fixed seat shall be provided
> next to each wheelchair seating area. When the seating capacity
> exceeds 300, wheelchair spaces shall be provided in more than one
> location.

28 C.F.R. Pt. 36, App. A § 4.33.3 (1994) \[hereinafter "Standard
4.33.3\"\].

> **B. [AMC Litigation: Factual and Procedural Summary]{.underline}**

In 1995, AMC opened a new 24-screen theater complex in Dallas, Texas
called the Grand 24. [See]{.underline} United States' Statement of
Uncontroverted Facts and Conclusions of Law ¶ 3 (filed Sept. 30, 2002)
\[hereinafter "U.S. Facts"\]. The Grand 24 employed a new type of
theater design whereby, rather than placing rows of seats on a gradually
sloping floor, all but a few rows of seats at the front of each theater
nearest the screen were placed on a series of seating platforms or
risers (up to 18 inches in height) to elevate the seats off of the
floor. (U.S. Facts ¶¶ 4-6.) Access to these seats on risers was
accomplished by climbing stairs, rather than walking up or down sloped
aisles. ([Id.]{.underline} ¶ 7.) This risered-seating design is
generally referred to in the theater industry as "stadium-style seating"
or "stadium seating." ([Id.]{.underline} ¶ 9.) At the Grand 24, all but
the four largest theaters locate wheelchair and companion seating in the
rows on the sloped floor portion of the theater nearest the screen,
rather than in the far more desirable and heavily-promoted stadium-style
seating section. ([Id.]{.underline} ¶ 8.)

AMC's opening of the Grand 24 was followed immediately by the opening of
several other AMC stadium-style theater complexes, including the
Promenade 16 in Woodland Hills, California and the Norwalk 20 in
Norwalk, California. ([Id.]{.underline} ¶ 10.) The majority of theaters
at the Promenade 16 and the Norwalk 20 theater complexes employed the
same type of stadium-style theater design whereby wheelchair and
companion seating was located in the first few rows of the theater
nearest the screen, rather than in the stadium-style seating section.
([Id.]{.underline} ¶ 11.) Indeed, the Grand's stadium-style seating
concept proved so popular with theater patrons \-- and so profitable for
AMC \-- all but one of the 83 theater complexes constructed or altered
by AMC since May 1995 has incorporated stadium-style seating.
([Id.]{.underline} ¶¶ 12-14.)

In 1997, the Department of Justice began investigating complaints by
patrons with disabilities and their companions that AMC was violating
the ADA by, [inter]{.underline} [alia]{.underline}, placing wheelchair
seats on the sloped floor portion of the theater in close proximity to
the screen, with non-comparable and less desirable lines of sight than
those found in the non-accessible stadium-style seating section.
([Id.]{.underline} ¶ 15.) Approximately one year later, in 1998, the
Department of Justice advised AMC that its theaters with stadium-style
seating violated Title III of the ADA, and cautioned that, if the
parties were not able to reach a negotiated agreement, the Civil Rights
Division had been authorized to commence an enforcement action.
([Id.]{.underline} ¶ 16.) Between June 1998 and January 1999, the
parties met and exchanged correspondence in an unsuccessful attempt to
resolve the matter. ([Id.]{.underline} ¶ 17.)

In January 1999, the United States commenced this action against AMC
alleging that it had engaged in a pattern or practice of violating Title
III of the ADA, 42 U.S.C. §§ 12181-12189, in the design, construction,
and operation of movie theaters with stadium-style seating across the
country. ([See]{.underline} Compl. for Declaratory & Inj. Relief,
Compensatory Damages, & Civil Penalties (filed Jan. 29, 1999)(Docket \#
1)("Complaint").) Although this Complaint alleges numerous ADA
violations, one of several important issues concerns the United States'
allegation that AMC has failed to provide patrons who use wheelchairs
(and their companions) with seats that are "an integral part of any
fixed seating plan and . . . \[that provide\] lines of sight comparable
to those for members of the general public." Standard 4.33.3. In short,
the United States alleges that, in the vast majority of the
stadium-style movie theaters at issue in this case, AMC impermissibly
relegates patrons who use wheelchairs (and their moviegoing companions)
to seats in the less desirable traditional sloped-floor section with its
inferior lines of sight, while other members of the public have access
to seats in the more desirable stadium-style section that offer far
superior lines of sight. ([See]{.underline}, [e.g.]{.underline},
Complaint ¶ 3.)

In April 1999, AMC filed its answer to the United States' initial
complaint and an accompanying one-count counterclaim seeking declaratory
relief. ([See]{.underline} Answer & Counterclaim.) In this Counterclaim,
AMC alleged that the Department had adopted a "new" substantive
interpretation of Standard 4.33.3 in violation of the Administrative
Procedure Act ("APA"), 5 U.S.C. §§ 552, 53. (Counterclaim ¶ 6.) More
specifically, AMC asserted that, when Standard 4.33.3 was initially
promulgated, the Department allegedly accepted the industry's view that
the regulation's comparability mandate was properly interpreted as
requiring "only an unobstructed view of the screen." ([Id.]{.underline}
at ¶ 9, [see]{.underline} [also]{.underline} [id.]{.underline} ¶¶ 8 &
12.) AMC claimed that it constructed the Grand and other theater
complexes "in accordance with and in reliance on" the Department's
purported initial interpretation of Standard 4.33.3. ([Id]{.underline}.
¶ 12.)

In June 1999, the United States moved to dismiss AMC's Counterclaim on
several grounds. ([See]{.underline} Pl. United States' Mem. In Supp. of
Its Mot. to Dismiss Defs.' Countercl. (filed June 15, 1999) (Docket \#
22) ("U.S. Dismiss Mem.").) First, the United States argued that the
Department's interpretations of Standard 4.33.3, whether made in the
course of this or any other enforcement action, do not constitute "final
agency action" subject to APA review. ([See]{.underline} U.S. Dismiss
Mem. at 8-12.) Second, the United States asserted that, in any event,
this Court lacked jurisdiction because AMC had an "adequate remedy"
within the meaning of APA § 704 to challenge the Department's
interpretation of Standard 4.33.3 in the underlying action.
([See]{.underline} [id]{.underline} at 12-13.)

In December 1999, this Court granted the United States' Motion to
Dismiss AMC's Counterclaim. ([See]{.underline} Order Granting Pl.'s Mot.
to Dismiss Defs.' Countercl. (filed Dec. 16, 1999) (Docket \# 51)
("Dismissal Order").) Rejecting AMC's finality claims, the Court held
that none of the Department's actions following the promulgation of
Standard 4.33.3 -- including the filing of *amicus* briefs in private
theater litigation, corresponding with theaters owners, or filing of
enforcement actions against theater owners (such as AMC) -- constituted
"final agency action" subject to judicial review under the APA.
(Dismissal Order at 9-14.) The Court also concluded that, in any event,
AMC had an adequate remedy at law "in that it may assert violation of
the APA as a defense to DOJ's enforcement action against it."
([Id]{.underline}. at 14.) Thus, because AMC had failed to establish the
jurisdictional prerequisites for APA review, the Court dismissed AMC's
counterclaim for lack of subject matter jurisdiction. ([Id]{.underline}.
at 17.)

> **C. [AMC's Texas Action: Redux of APA Claims]{.underline}**

At the same time the parties were litigating AMC's counterclaim in this
action, AMC became a party to another APA-based challenge to the
Department's interpretation of Standard 4.33.3 in a separate action in
Texas, [Cinemark USA, Inc. v. United States Dep't of
Justice]{.underline}, C.A. No. 3:99-CV-0183-L (January 28, 1999). In
March 1999, only two months after the commencement of the
[Cinemark]{.underline} action, AMC moved to intervene as a
party-plaintiff. (AMC Mot. to Intervene, Decl. & Exs. in Supp. of Pl.
U.S.' Mot. for Partial S.J. on Defs.' Affirmative Defenses, Ex.16.)[^1]
As in the [AMC]{.underline} litigation, AMC's [Cinemark]{.underline}
complaint alleged that the defendant Department of Justice had violated
the APA (and the United States Constitution) by purportedly promulgating
"new" substantive interpretations of Standard 4.33.3 without following
notice and comment requirements:

> This suit challenges the United States Department of Justice's
> adoption and attempted enforcement of various "interpretations" with
> respect to \[Standard 4.33.3\]. These "interpretations" set forth new,
> stricter requirements for compliance with the Americans With
> Disabilities Act Accessibility Guidelines (ADAAG) and conflict with
> prior "interpretations" espoused by the Department with respect to the
> application and meaning of the ADAAG. Each new "interpretation"
> constituted a substantive change in the regulations adopted and are
> therefore null and void due to the Department's failure to comply with
> the Administrative Procedures Act (APA). . . . \[The Department has\]
> acted in a manner that is beyond their legal and statutory authority
> and in violation of the United States Constitution. The promulgation
> without notice and retroactive application of these positions
> constitutes a denial of AMC's due process rights and unlawful taking
> of its property in violation of the United States Constitution.

(AMC [Cinemark]{.underline} Complaint ¶ 1, Ex. 17.) In July 1999, the
Court granted AMC's intervention motion, and its complaint was accepted
for filing. (Order Granting Intervention, Ex. 18.)

The parties to the [Cinemark]{.underline} action -- [i.e]{.underline}.,
the Department of Justice, Cinemark, and AMC -- thereafter engaged in
several rounds of briefing on various discovery disputes and dispositive
motions, including the Department's Motion to Dismiss both AMC and
Cinemark's Complaints. ([See]{.underline} Def.'s Mem. In Supp. of Mot.
to Dismiss, Ex. 19.) In July 2000, the [Cinemark]{.underline} court
granted the Department's dismissal motion against both Cinemark and AMC.
(Mem. Op. & Order Granting Mot. to Dismiss, Ex. 20
("[Cinemark]{.underline} Dismissal Order").) Relying in part on this
Court's December 1999 dismissal order in the [AMC]{.underline} action,
the [Cinemark]{.underline} court held that none of the Department's
interpretations with respect to, or enforcement actions under, Standard
4.33.3 formed the requisite "final agency action" necessary for APA
review. ([Id]{.underline}. at 7-11.) Both the Cinemark and AMC
complaints were, therefore, dismissed for lack of subject matter
jurisdiction. ([Id]{.underline}. at 5,12.)

[III. ARGUMENT]{.underline}

**AMC'S VARIOUS AFFIRMATIVE DEFENSES FAIL LEGAL REQUIREMENTS ON VARIOUS
GROUNDS AND SHOULD BE DISMISSED**

> **A. [Summary Judgment Standard]{.underline}**

Summary judgment should be granted when "the pleadings, depositions,
answers to interrogatories, and admissions on file, together with the
affidavits, if any, show that there is no genuine issue as to any
material fact" and "the moving party is entitled to judgment as a matter
of law." Fed. R. Civ. P. 56(c); [Celotex Corp. v. Catrett]{.underline},
477 U.S. 317, 322, 106 S. Ct. 2548, 2552 (1986); [Anderson v. Liberty
Lobby, Inc.]{.underline}, 477 U.S. 242, 247-48, 106 S. Ct. 2505, 2509
(1986). An issue of fact is "genuine" if the evidence is such that a
reasonable jury could return a verdict for the nonmovant.
[Anderson]{.underline}, 477 U.S. at 248. A fact is "material" if it is
"relevant to an element of a claim or defense" and its "existence might
affect the outcome of the suit" under governing substantive law. [T.W.
Elec. Serv., Inc. v. Pacific Elec. Contractors Ass'n]{.underline}, 809
F.2d 626, 630 (9th Cir. 1987)(citing [Anderson]{.underline}, 477 U.S. at
248). Disputes over irrelevant or unnecessary facts the resolution of
which would not affect the outcome of the suit are irrelevant to the
Court's consideration, and will not preclude the granting of summary
judgment. [Arpin v. Santa Clara Valley Transp. Agency]{.underline}, 261
F.3d 912, 919 (9th Cir. 2001)(citing [Anderson]{.underline}, 477 U.S. at
248); [T.W. Elec. Serv., Inc.]{.underline}, 809 F.2d at 630. The moving
party bears the burden of showing the absence of any issues of material
fact, and the Court views the facts and all inferences drawn therefrom
in the light most favorable to the nonmoving party. [See]{.underline}
[Celotex]{.underline}, 477 U.S. at 323; [Matsushita Elec. Indus. Co.,
Ltd. v. Zenith Radio Corp.]{.underline}, 475 U.S. 574, 587-88, 106 S.
Ct. 1348, 1356 (1986). The moving party's burden may be met by "showing
. . . that there is an absence of evidence to support the nonmoving
party's case." [Fairbank v. Wunderman Cato Johnson]{.underline}, 212
F.3d 528, 531 (9th Cir. 2000)(quoting [Celotex]{.underline}, 477 U.S. at
325). Once the moving party has satisfied its burden of proof, the
burden then shifts to the nonmoving party, who may not simply rely on
mere allegations in the pleadings, but must instead set forth by
affidavit or as otherwise provided in Rule 56, specific facts showing
that there is a genuine issue for trial. [Id.]{.underline}; [T.W. Elec.
Serv., Inc.]{.underline}, 809 F.2d at 630. "The mere existence of a
scintilla of evidence in support of the non-moving party's position is
not sufficient" to preclude summary judgment. [Arpin]{.underline}, 261
F.3d at 919.

> **B. [Preclusion and Law of the Case Principles Bar AMC From Asserting
> Its APA-Based Defenses In this Action (Affirmative Defense Nos. 2,
> 18-22)]{.underline}**

AMC has already twice litigated (and lost) the APA-based claims raised
in its affirmative defenses. Both this Court and the
[Cinemark]{.underline} court have conclusively determined that the
Department's interpretation of Standard 4.33.3 does not constitute
"final agency action" subject to judicial review under the APA.
Preclusion and law of the case principles now prevent AMC from seeking
yet a third bite at the litigation apple. Summary judgment should thus
be entered in favor of the United States on AMC's APA-based affirmative
defenses.

Designed to promote judicial efficiency and finality, the law of the
case doctrine stands for the common-sense principle that the *same*
issues presented a second time in the *same* case in the *same* court
should lead to the *same* result. [See]{.underline}, [e.g]{.underline},
[United States v. Alexander]{.underline}, 106 F.3d 874, 876 (9th Cir.
1997) ("Under the 'law of the case' doctrine, a court is generally
precluded from reconsidering an issue that has already been decided by
the same court . . . in the identical case."); [see]{.underline}
[also]{.underline} [United States v. Lummi Indian Tribe]{.underline},
235 F.3d 443, 452 (9th Cir. 2000); [Mendenhall v. Nat'l Transp. Safety
Bd.]{.underline}, 213 F.3d 464, 469 (9th Cir. 2000); [Goodyear Tire &
Rubber v. McDonnell Douglas Corp.]{.underline}, 820 F. Supp. 503, 509
(C.D. Cal. 1992). A court may only depart from the law of the case under
certain limited circumstances, such as an intervening change in the law
or a finding that the first decision was clearly erroneous.
[See]{.underline}, [e.g.]{.underline}, [Lummi Indian Tribe]{.underline},
235 F.3d at 452-53; [Alexander]{.underline}, 106 F.3d at 876. Failure to
apply law of the case principles---absent one of these requisite
circumstances---amounts to an abuse of discretion.
[Alexander]{.underline}, 106 F.3d at 876.

Applying these principles to AMC's APA-based affirmative defenses, it is
beyond peradventure that these no longer present viable legal defenses.
This Court's December 1999 order dismissing AMC's counterclaim expressly
held that none of the Department's action following the promulgation of
Standard 4.33.3 -- including the filing of *amicus* briefs in private
theater litigation, corresponding with theater owners, or the filing (or
threats of filing) enforcement actions against theater owners --
constituted "final agency action" subject to judicial review under the
APA. ([See]{.underline} Dismissal Order at 17; [see]{.underline}
[also]{.underline} discussion, [supra]{.underline}, at 4-5.) This
Dismissal Order is now law of the case and bars AMC from continuing to
litigate its APA claims by way of its affirmative defenses.[^2]
[See]{.underline}, [e.g.]{.underline}, [United States v. Iron Mountain
Mines, Inc.]{.underline}, 987 F. Supp. 1244, 1246-47 (E.D. Cal. 1997)
(prior summary judgment ruling dismissing affirmative defense prevented
re-litigation of same affirmative defense later in same action);
[Goodyear Tire & Rubber v. McDonnell Douglas Corp.]{.underline}, 820 F.
Supp. 503, 508-509 (C.D. Cal. 1992); (denying motion for summary
judgment on law of the case grounds when such motion was "virtually
identical" to summary judgment motion denied earlier in same case).

While law of the case principles standing alone provide ample legal
basis for entry of summary judgment against AMC on its APA-based
affirmative defenses, application of collateral estoppel based on the
[Cinemark]{.underline} dismissal order sounds the procedural death knell
for these defenses. As a general matter, the doctrine of collateral
estoppel ([i.e]{.underline}. - issue preclusion) prevents re-litigation
of all issues of fact that were actually litigated and necessarily
decided by a valid and final judgment in a prior proceeding.
[See]{.underline}, [e.g.]{.underline}, [Arizona v.
California]{.underline}, 530 U.S. 392, 414, 120 S. Ct. 2304, 2319
(2000); [Robi v. Five Platters, Inc.]{.underline}, 838 F.2d 318, 321-22
(9th Cir. 1988); [Restatement (Second) of Judgments]{.underline} § 27
(1982) \[hereinafter "[Restatement]{.underline}"\]. Furthermore, once
the requirements for preclusion have been satisfied, the determination
in the first action is conclusive in any subsequent action between the
parties or their privies irrespective of whether the second action
involves the same or different claims. [See]{.underline}
[Restatement]{.underline} § 27; [see]{.underline} [also]{.underline} 18
Charles Alan Wright & Arthur R. Miller, [Federal Practice and
Procedure]{.underline} §§ 4416 - 4417 (1981).

Here, the [Cinemark]{.underline} dismissal order plainly satisfies all
of the conditions for application of collateral estoppel. Both AMC and
the Department of Justice were parties to the [Cinemark]{.underline}
litigation. ([See]{.underline} discussion, [supra]{.underline}, at 5-6.)
Moreover, there can be no question that the [Cinemark]{.underline} court
"actually and necessarily" determined by a valid final judgment that it
lacked subject matter jurisdiction under the APA to adjudicate AMC's
claims. ([See]{.underline} [Cinemark]{.underline} Dismissal Order, Ex.
20 at 7-12.) Since AMC is presently asserting the identical APA claims
and jurisdictional bases in this action as in the [Cinemark]{.underline}
litigation, ([see]{.underline} discussion, [supra]{.underline}, at 5-6),
its APA-based affirmative defenses are now jurisdictionally barred.
[See]{.underline}, [e.g.]{.underline}, [Okoro v. Bohman]{.underline},
164 F.3d 1059, 1063 (7th Cir. 1999) (finding that jurisdictional
dismissal in first action collaterally estops re-litigation of
jurisdiction in second suit); [Oglala Sioux Tribe v. Homestake Mining
Co.]{.underline}, 722 F.2d 1407, 1411 (8th Cir. 1984) ("Dismissal of a
suit for lack of subject matter jurisdiction precludes re-litigation of
the same issue of subject matter jurisdiction in a second federal suit
on the same claim."); [Hoffman v. United States]{.underline}, 53 F.
Supp.2d 483, 492-93 (D.D.C. 1999) (granting summary judgment based on
*res judicata* in favor of United States in action arising under the
Federal Tort Claims Act when, in an earlier FTCA-based action between
the same parties, the Fifth Circuit had already determined that federal
courts lacked jurisdiction over plaintiffs' claims); [Federal Practice &
Procedure]{.underline} § 4402, 4435-36; [see]{.underline}
[generally]{.underline} [Underwriters Nat'l Assurance Co. v. North
Carolina Life & Accident & Health Ins. Guar. Ass'n]{.underline}, 455
U.S. 691, 706, 102 S. Ct. 1357, 1367 (1982) (affirming "long recognized"
principle that "*res judicata* appl\[ies\] to questions of jurisdiction
as well as to other issues").

Taken together, application of the law of the case doctrine (based on
this Court's December 1999 Dismissal Order), and collateral estoppel
principles (based on the dismissal of AMC's identical APA claims in the
[Cinemark]{.underline} action), form an impenetrable legal barrier
against AMC's APA-based affirmative defenses in this action. The only
remaining issue concerns the scope of these preclusive precedents.
Unquestionably, AMC's second affirmative defense -- which expressly
alleges that the United States' complaint is defective because the
Department "failed to comply with the \[APA\] in promulgating the
interpretation of the regulations \[it\] now asserts in this action" --
is precluded by these prior judicial decisions. (Answer ¶ 38.) Moreover,
AMC's Affirmative Defense Nos. 18 through 22 must also be deemed to fall
within the preclusive ambit of these decisions, since the primary focus
of these constitutional defenses, as with Affirmative Defense No. 2, is
alleged defects attending the Department's purportedly "new"
interpretation of Standard 4.33.3 at issue in this litigation.[^3] For
example, Affirmative Defense No. 22 alleges that "enforcement of \[the
United States'\] interpretation of the regulations it purports to
enforce would amount to a retroactive application of the law in
violation of the United States Constitution." (Answer ¶ 58.) This
retroactivity claim necessarily rests on the assumption that the
Department's "interpretation" of Standard 4.33.3 that it seeks to
"enforce" in this action constituted final agency action with all of the
attendant procedural requirements set forth in the APA. Yet with two
courts having already fully and finally determined that none of the
Department's actions or interpretations following the promulgation of
Standard 4.33.3 in 1991 amounted to "final agency action" subject to
judicial review, the United States cannot now be held to have
impermissibly and retroactively enforced an "interpretation" of that
Standard that is not final agency action. This Court should, therefore,
enter summary judgment in favor of the United States with respect to all
of AMC's APA-based affirmative defenses (Affirmative Defense Nos. 2 &
18-22).

> **C. [AMC Fails to Carry Its Heavy Burden of Demonstrating That the
> Requisite\
> Exceptional Circumstances Exist to Support an Equitable Estoppel
> Claim\
> Against the Federal Government (Affirmative Defense Nos. 3, 5,
> 24)]{.underline}**

AMC's affirmative defenses raising equitable estoppel claims prove
equally meritless. In these defenses, AMC alleges it "justifiably and in
good faith" relied on unspecified "representations" and "directives" by
the Department such that the United States is now "estopped from
enforcing conflicting interpretations of the regulations . . . in this
action." ([See]{.underline} Answer ¶¶ 39, 41.) AMC's equitable estoppel
claims are meritless, however, because AMC has not satisfied (and cannot
satisfy) the virtually insurmountable evidentiary showing necessary to
make this affirmative defense in this action.

As an initial matter, equitable estoppel rarely lies against the federal
government. Indeed, the Supreme Court as recently as 1990 noted that "we
have reversed every finding of estoppel we have reviewed." [Office of
Personnel Mgmt. v. Richmond]{.underline}, 496 U.S. 414, 422, 110 S. Ct.
2465, 2470 (1990); [see]{.underline} [also]{.underline} [Rojas-Reyes v.
I.N.S.]{.underline}, 235 F.3d 115, 126 (2nd Cir. 2000) (noting that
doctrine of equitable estoppel "is not available against the government
except in the most serious circumstances . . . and is applied with
utmost caution and restraint") (internal citations omitted); [Harrod v.
Glickman]{.underline}, 206 F.3d 783, 793 (8th Cir. 2000) (characterizing
Supreme Court jurisprudence as holding that estoppel will "rarely work
against the government")(internal citations omitted); [Costa v.
I.N.S.]{.underline}, 233 F.3d 31, 38 (1st Cir. 2000) (noting that
estoppel against the government "if it exists at all is hen's-teeth
rare"). Thus, not surprisingly, the Ninth Circuit -- in accordance with
other federal circuits -- has held that private litigants asserting
estoppel claims against the government shoulder the heavy burden of
demonstrating, not only the traditional elements of estoppel, but also
that: (i) the government's act or actions constituted "affirmative
misconduct;" (ii) such misconduct "threatened to work a serious
injustice;" and (iii) the "imposition of estoppel \[would\] not unduly
harm the public interest." [See]{.underline}, [e.g]{.underline}.,
[Purcell v. United States]{.underline}, 1 F.3d 932, 939 (9th Cir. 1993)
(internal citations omitted); [accord]{.underline}
[Rojas-Reyes]{.underline}, 235 F.3d at 125; [Costa]{.underline}, 233
F.3d at 38; [LaBonte v. United States]{.underline}, 233 F.3d 1049, 1053
(7th Cir. 2000).

Applying the foregoing legal considerations, AMC cannot, as a matter of
law, erect a viable equitable estoppel defense. First, and most
importantly, AMC's estoppel argument is legally insufficient because it
fails to even allege "affirmative misconduct" on the part of Department
officials. At most, all that AMC has claimed in various pleadings is
that the Department -- whether through *amicus* briefs filed in private
litigation, settlement agreements with other movie theater companies
(such as the United Artist settlement), Technical Assistance manuals,
oral statements by Department employees, or other public statements --
has put forth allegedly inconsistent interpretations of Standard 4.33.3,
and that AMC relied on these allegedly inconsistent interpretations to
its detriment. Affirmative misconduct requires much more \-- even
assuming, as AMC alleges, these statements were indeed misleading or
inconsistent. [See]{.underline}, [e.g.]{.underline}, [Heckler v. Cmty.
Health Servs.]{.underline}, 467 U.S. 51, 64-66, 104 S. Ct. 2218, 2223-27
(1984) (holding that United States was not estopped from recouping
Medicare overpayment even when plaintiff-respondent relied to its
detriment on erroneous advice by an employee of the federal government's
fiscal intermediary); [United States v. Hemmen]{.underline}, 51 F.3d
883, 892 (9th Cir. 1995)(affirmative misconduct standard requires proof
of "affirmative conduct going beyond mere negligence")(internal
quotation omitted).[^4]

Nowhere does AMC demonstrate that: (i) the United Artists agreement was
anything other than a typical settlement agreement between the
Department and private litigants; (ii) this Agreement contained
"erroneous" advice by the Department regarding Standard 4.33.3; or (iii)
AMC's purported reliance on a settlement agreement in a lawsuit to which
it was not a party should be considered "reasonable" when designing and
constructing multi-million dollar movie theater complexes.[^5]

Thus, because AMC has failed to carry its heavy burden of establishing
the legal and factual elements necessary to support an estoppel claim
against the government, this Court should grant the United States'
motion for summary judgment on AMC's Affirmative Defense Nos. 3, 5, and
24.

> **D. [United States Has Not Expressly or Impliedly Waived Its Claims
> Against AMC (Affirmative Defenses Nos. 4, 13)]{.underline}**

AMC asserts in Affirmative Defense Nos. 4 and 13 that the United States'
claims are barred in whole or part by the equitable doctrine of waiver.
Despite the dearth of evidence even tending to show that the United
States has waived its right to bring this action against AMC, defendants
contend that the United States expressly and/or impliedly waived all of
its claims against AMC under Title III of the ADA. (Answer ¶¶ 40, 49.)
No facts have been produced showing waiver on the part of the United
States, and thus AMC does not satisfy the stringent requirements for
establishing these affirmative defenses. Accordingly, summary judgment
should be granted in favor of the United States as to AMC's Affirmative
Defense Nos. 4 and 13.

To establish the defense of waiver against the United States, defendants
bear the heavy burden of showing "an intentional relinquishment or
abandonment of a known right or privilege." [Groves v.
Prickett]{.underline}, 420 F.2d 1119, 1125 (9th Cir. 1970). A waiver
must be unconditional, and, in contrast to the doctrine of equitable
estoppel, the waiver doctrine focuses on the actions and intent of the
party alleged to have waived their rights. [See]{.underline} [Intel
Corp. v. Hartford Accident & Indem. Co.]{.underline}, 952 F.2d 1551,
1559 (9th Cir. 1991); [Monterey Bay Unified Air Pollution Control Dist.
v. Unites States Dep't of the Army]{.underline}, 176 F. Supp.2d 979, 989
(N.D. Cal. 2001). Courts emphasize that a party cannot establish the
waiver of a right absent "a clear showing of an intent to relinquish
such right," and that cases where that intention is in doubt are to be
decided against a finding of waiver. [Wong v. Cal. Franchise Tax
Bd.]{.underline}, No. C 97-2748, 2000 WL 630878, at \*4 (N.D. Cal., May
2, 2000)(finding no waiver of the statute of limitations defense by
defendants where parties orally agreed that plaintiff could re-file her
dismissed claims, but failed to agree to the terms of a stipulation to
that effect), Ex. 26; [see]{.underline} [also]{.underline} [In re United
Marine Shipbuilding, Inc.]{.underline}, 158 F.3d 997, 1001 (9th Cir.
1998)(holding that inadvertent disbursement by IRS of a tax refund to
debtor did not constitute a voluntary and intentional relinquishment by
government of its right of setoff with regard to tax refund). AMC has
failed to allege any facts or point to any evidence, such as written
statements, pleadings, or letters by the Department expressly stating
that the United States intends to relinquish its rights to enforce this
action. Nor is AMC able to present such evidence, because throughout the
course of its investigation of AMC and the litigation of this case, the
United States has consistently and diligently pursued the enforcement of
its ADA claims against AMC. ([See]{.underline} discussion
[supra]{.underline}, at 3-4.) Thus, in the absence of any evidence of
the United States' intent to knowingly waive its rights, defendants'
Affirmative Defense No. 4 fails as a matter of law.

Similarly, AMC has been unable to garner any factual support for its
unsubstantiated claim that the United States has impliedly waived its
right to bring this action through its "words, representations, actions,
inactions or conduct." (Answer ¶ 49.) In order to establish this
defense, AMC, at a minimum, must present evidence of conduct that is
"clear, decisive and unequivocal of a purpose to waive the legal rights
involved." [Groves]{.underline}, 420 F.2d at 1126; [see
also]{.underline} [United States v. Amwest Sur. Insur. Co.]{.underline},
54 F.3d 601, 603 (9th Cir. 1995). AMC must also be able to point to
facts revealing a clear, unequivocal, and decisive act on the part of
the United States that shows a purpose to abandon or waive its legal
right to enforce this action. [See]{.underline} [United States v.
Chichester]{.underline}, 312 F.2d 275, 282 (9^th^ Cir. 1963). Such acts
must be so inconsistent with an intent to enforce the right as to induce
a reasonable belief that such right has been relinquished. [Intel Corp.
v. Hartford Accident & Indem. Co.]{.underline}, 952 F.2d 1551, 1559 (9th
Cir. 1991); [see]{.underline} [also]{.underline} [Central Bank Nat'l
Ass'n v. Superior Court]{.underline}, 81 Cal. App.3d 592, 600-01 (Cal.
Ct. App. 1978)(conduct "should be so manifestly inconsistent with and
indicative of an intent to relinquish voluntarily a particular right
that no other reasonable explanation of \[the\] conduct is possible").
AMC has failed to allege any conduct that clearly, unequivocally, and
decisively shows an intentional purpose on the part of the United States
to waive its right to enforce Title III of the ADA against AMC, nor is
there any evidence of conduct manifesting such an intent on the part of
the United States. The United States has consistently sought to enforce
its claims against AMC for violations of Title III in the construction
and operation of AMC's stadium-style theaters, and has never deviated
from the enforcement of that right. Accordingly, Affirmative Defense
Nos. 4 and 13 are insufficient as a matter of law, and summary judgment
should be granted in favor of the United States.

> **E. [United States' Position In This Case Is Entirely Consistent With
> Positions It Has Taken In All Other Stadium-Style Theater Cases
> (Affirmative Defense No. 6)]{.underline}**

Although AMC asserts in Affirmative Defense No. 6 that the United
States' claims are barred by the doctrine of judicial estoppel, (Answer
¶ 42.), it has once again failed to allege any facts in support of this
defense. Because AMC has not met the rigorous requirements for
establishing the defense of judicial estoppel against the United States,
summary judgment should be granted as to this affirmative defense as
well.

Judicial estoppel is an equitable doctrine that is invoked by the Court
when "a party's position is 'tantamount to a knowing misrepresentation
to or even fraud on the court.'" [Johnson v. State of
Oregon]{.underline}, 141 F.3d 1361, 1369 (9th Cir. 1998)(quoting [Ryan
Operations G.P. v. Satiam-Midwest Lumber Co.]{.underline}, 81 F.3d 355,
362-63 (3d Cir. 1996)). Aimed at protecting the integrity of the
judicial process, judicial estoppel prevents a party from gaining
advantage through the manipulative assertion of incompatible positions
over the course of judicial proceedings when such positions have an
adverse impact on the judicial process. [See]{.underline} [Rissetto v.
Plumbers & Steamfitters Local]{.underline} 343, 94 F.3d 597, 601 (9th
Cir. 1996); [Comm. of the Russian Fed'n on Precious Metals & Gems v.
United States]{.underline}, 987 F. Supp. 1181, 1183-84 (N.D. Cal. 1997).
Judicial estoppel prevents a litigant from playing "fast and loose" with
the courts, and is invoked at the court's discretion. [Russel v.
Rolfs]{.underline}, 893 F.2d 1033, 1037 (9th Cir. 1990);
[see]{.underline} [also]{.underline} [American Booksellers Ass'n, Inc.
v. Barnes & Noble, Inc.]{.underline}, 135 F. Supp.2d 1031, 1046 (N.D.
Cal. 2001).

In order to establish the defense of judicial estoppel, AMC must
demonstrate "a knowing antecedent misrepresentation" by the United
States in a judicial proceeding, which directly contradicts an assertion
that has been tendered to this Court. [Wyler Summit P'ship v. Turner
Broad. Sys., Inc.]{.underline}, 235 F.3d 1184, 1190 (9th Cir. 2000). The
United States' current position must be so "manifestly inconsistent with
a prior position," as to constitute "an affront to the court."
[Id.]{.underline}(internal citations omitted). Absent chicanery or the
intent to gain advantage by misleading the court, judicial estoppel does
not apply. [Johnson]{.underline}, 141 F.3d at 1369. Thus, alternative
positions taken during the course of litigation or incompatible
positions taken inadvertently or by mistake are not subject to judicial
estoppel. [Id.]{.underline}; [see]{.underline} [also]{.underline} [Comm.
of the Russian Fed'n]{.underline}, 987 F. Supp. at 1184. Moreover, under
Ninth Circuit case law, the earlier court must have actually relied on
the party's previously inconsistent statement in making its ruling.
[Masayesva v. Hale]{.underline}, 118 F.3d 1371, 1382 (9th Cir. 1997).

Here, AMC has plainly failed to show that the United States' position in
this case with respect to the application of Standard 4.33.3 to AMC's
stadium-style movie theaters is so manifestly inconsistent with
positions the United States has taken in other stadium-style theater
litigation as to amount to legal chicanery. First, Magistrate Judge
Hillman has already expressly held, during the course of discovery
proceedings in this action, that "Defendant \[AMC\] has not shown
inconsistent interpretations by \[the United States\] of § 4.33.3 with
regard to commercial stadium style movie theaters." (Min. Order Denying
Defs.' Mot. to Compel, at 3 (June 5, 2000)(Docket #134);
[see]{.underline} discussion [supra]{.underline}, at 13 & n. 5.) This
ruling by Magistrate Judge Hillman is now law of the case.

Second, even setting aside Magistrate Judge Hillman's prior ruling
holding that there was no evidence establishing that the United States
had taken inconsistent positions with respect to the application of
Standard 4.33.3 to stadium-style movie theaters, AMC still fails to
state a legally viable judicial estoppel defense. The Department of
Justice issued Standard 4.33.3 in 1991, and articulated its
interpretation of this regulation as it applied to stadium-style
theaters in an *amicus* brief filed in a private ADA action styled [Lara
v. Cinemark, USA, Inc.]{.underline}, No. 97-CV-502 (W.D. Tex
1998)([See]{.underline} [Lara]{.underline} *Amicus* Brief, Ex. 21). The
[Lara]{.underline} *amicus* brief was filed with the permission of the
district court and announced a plain language interpretation of Standard
4.33.3. Specifically, the [Lara]{.underline} brief set forth the
Department's position that Standard 4.33.3 required wheelchair seating
areas be an "integral part" of the fixed seating, and to provide people
with physical disabilities "lines of sight that are comparable to those
provided to the general public." ([Id.]{.underline} at 4.) In
interpreting the term "comparable," the United States used the everyday
understanding of the word, which is "capable of or suitable for
comparison; equivalent; similar." Webster's Ninth Collegiate Dictionary
(1990). Thus, the language in the Standard requiring "lines of sight
comparable to those of the general public" was interpreted by the
Department to mean that "in stadium style seating, wheelchair locations
must be provided lines of sight in the stadium style seats within the
range of viewing angles as those offered to most of the general public
in the stadium style seats, adjusted for seat tilt." ([Id.]{.underline}
at 5.) Thus, as stated in the [Lara]{.underline} brief, wheelchair
locations should not be relegated to the worst sight lines in the
building, but neither do they categorically have to be in the best.
([Id.]{.underline})

Since then, the Department in this case and all other cases involving
stadium-style theaters has consistently adhered to its plain language
interpretation of Standard 4.33.3. ([See]{.underline} [Lara v.
Cinemark]{.underline}, 207 F.3d 783 (5th Cir. 2000)(United States
participated as *amicus curiae*); [Oregon Paralyzed Veterans v. Regal
Cinema Theaters, Inc.]{.underline}, No. 01-35554 (9th Cir. Oct. 19,
2001)(United States participated as *amicus curiae*); [Lonberg v.
Sanborn Theaters, Inc.]{.underline}, No. 97-6598 (C.D. Cal. 1999)(United
States participated as intervenor); [United States v. Cinemark, USA,
Inc.]{.underline}, No. 99 CV 705 (N.D. Ohio 2001); [United States v.
Hoyts Cinemas Corp.]{.underline}, No. 00-CV-12567 (D. Mass. 2000);
[United States v. National Amusements, Inc.]{.underline}, No.
00-CV-12568 (D. Mass. 2000). Because Defendants have not and cannot
allege any facts showing that the United States has taken a position in
this case with regard to Standard 4.33.3 that is so manifestly
inconsistent with a position taken in another judicial proceeding as to
constitute an affront to the Court, AMC's judicial estoppel defense
fails. Accordingly, as AMC has failed to meet the factual and legal
requirements for defending this action on the grounds of judicial
estoppel, the United States' motion for summary judgment as to AMC's
Affirmative Defense No. 6 should be granted.

> **F. [Statutes of Limitations and/or Laches Do Not Run Against the
> United States When Enforcing the Public Interest (Affirmative Defense
> Nos. 7 & 8)]{.underline}**

AMC also asserts that the United States' claims are barred by the
applicable statute of limitations and the doctrine of laches. Black
letter law, however, precludes AMC from raising either of these
equitable defenses in this action. Accordingly, this Court should grant
summary judgment with respect to AMC's Affirmative Defense Nos. 7 and 8.

Neither federal nor state statutes of limitation bar the United States'
claims in this action.

First, whatever may be said for the application of state statutes of
limitation in private litigation, it is well-settled that state statutes
of limitation do not run against the federal government where, as here,
it is enforcing a public right or protecting a private interest. [United
States v. Summerlin]{.underline}, 310 U.S. 414, 416, 60 S. Ct.1019,1020
(1940)("the United States is not bound by state statute of limitation or
subject to the defense of laches in enforcing its rights.");
[see]{.underline} [also]{.underline} [Chesapeake & Delaware Canal Co. v.
United States]{.underline}, 250 U.S. 123, 125, 39 S. Ct. 407, 408
(1919). The United States is ***only*** subject to a limitations period
when Congress has expressly created one by federal statute. [United
States v. Thornburg]{.underline}, 82 F.3d 886, 893 (9th Cir. 1996). Yet
neither the ADA nor any other federal statute expressly impose any
limitations period for enforcement actions initiated by the Department
(on behalf of the United States) under the ADA. Accordingly, the United
States is not barred from bringing this action against AMC by either a
federal or state statute of limitation.

Even if a statute of limitations did apply to the United States'
enforcement of the ADA in this case, AMC would nonetheless be precluded
from asserting this defense based on its continuing violation of the
relevant provisions of the ADA. Although most often applied in Title VII
employment actions, courts have repeatedly found that continuing
violations or patterns of discrimination toll relevant statutes of
limitation. [See]{.underline} [e.g.]{.underline}, [Nat'l R.R. Passenger,
Corp. v. Morgan]{.underline}, 122 S. Ct. 2061, 2073-76 (2002); [Airweld,
Inc. v. Airco, Inc.]{.underline}, 742 F.2d 1184, 1190 (9th Cir. 1984);
[Green v. Los Angeles Superintendent of Sch.]{.underline}, 883 F.2d
1472, 1480 (9th Cir. 1989). To determine a continuing violation, a
plaintiff must demonstrate either a series of related discriminatory
acts, where one or more acts fall within the limitations period, or the
maintenance of a discriminatory system both before and during the
limitations period. [Green]{.underline}, 883 F.2d at 1480 (9th Cir.
1989)(quoting [Valentino v. United States Postal Serv.]{.underline}, 674
F.2d 56, 65 (D.C.Cir. 1982). Here, AMC has engaged, to date, in a
pattern or practice of discriminating against patrons who use
wheelchairs, and their companions by failing to provide seats with
comparable lines of sight in their stadium-style theaters.
([See]{.underline} Complaint ¶¶ 3, 14, 19, 25, 32.) Thus, even if AMC
could point to an applicable limitation of time for bringing this
action, it is abundantly clear that their history of designing,
constructing, and operating non-compliant theaters from the 1995
construction of the Grand to the present would be deemed a continuing
violation, tolling any relevant statute of limitation. (U.S. Facts ¶¶
3-8, 14.)

The doctrine of laches also proves unavailing to AMC as a defense to
this matter. Laches is an equitable time limitation on a party's right
to bring suit. [Kling v. Hallmark Cards, Inc.]{.underline}, 225 F.3d
1030, 1036 (9th Cir. 2000). To obtain a judgment on this affirmative
defense, a defendant must prove both an unreasonable delay by the
plaintiff in initiating the action and prejudice. [Id.]{.underline}
However, as with the statute of limitations, laches generally does not
serve as a defense against the federal government. [See]{.underline}
[e.g.]{.underline}, [Chesapeake & Delaware Canal Co., v. United
States]{.underline}, 250 U.S. 123, 125 (1919)("It is settled beyond
controversy that the United States when asserting 'sovereign' or
governmental rights is not subject . . . to laches."); [see]{.underline}
[also]{.underline} [Utah Power & Light Co. v. United
States]{.underline}, 243 U.S. 389, 409 (1919)("As a general rule, laches
or neglect of duty on the part of officers of the government is no
defense to a suit by it to enforce a public right or protect a public
interest."); [Summerlin]{.underline}, 310 U.S. at 416; [Chevron, U.S.A.,
Inc. v. United States]{.underline}, 705 F.2d 1487, 1491 (9th Cir.
1983)("The government is not bound by state statutes of limitations or
laches in enforcing its rights."). AMC's laches defense fails to state a
legally viable defense and, therefore, should be dismissed from this
action on summary judgment.[^6]

> **G. [United States Is Not Precluded From Bringing This Action By
> Either The Doctrine of Collateral Estoppel or Res Judicata
> (Affirmative Defense No. 9)]{.underline}**

Equally without merit is AMC's Affirmative Defense No. 9, which asserts
that the United States' claims are barred by the doctrine of res
judicata or collateral estoppel. (Answer ¶ 45.) Neither of these
doctrines bars the United States' claims in this action since the United
States and AMC have only been involved in the same ADA-related
litigation on two occasions, and neither of these prior actions satisfy
the stringent procedural requirements for application of these
doctrines. This Court should, therefore, grant summary judgment in favor
of the United States on AMC's Affirmative Defense No. 9.

> **1. Collateral Estoppel**

As discussed previously, the doctrine of collateral estoppel prevents a
party from re-litigating issues of fact or law that were actually
litigated, and necessarily decided by a valid and final judgment in a
prior proceeding, when the determination in the prior proceeding was
essential to the judgment. ([See]{.underline} discussion
[supra]{.underline}., at 9-10 (collecting cases)); [see]{.underline}
[also]{.underline} [Amadeo v. Principal Mut. Life Insur.
Co.]{.underline}, 290 F.3d 1152, 1159 (9th Cir. 2002); [Robi v. Five
Platters, Inc.]{.underline}, 838 F.2d 318, 322 (9^th^ Cir. 1988). The
federal government, moreover, can only be estopped when there is
mutuality of the parties -- [i.e]{.underline}., the litigants in the
first and second actions are the same. [See]{.underline},
[e.g]{.underline}., [United States v. Mendoza]{.underline}, 464 U.S.
154, 159-163, 104 S. Ct. 568, 572-574 (1984) (discussing prudential
considerations and holding that nonmutual offensive collateral estoppel
does not apply against the federal government); [American Fed\'n of
Gov\'t Employees v. FLRA]{.underline}, 835 F.2d 1458, 1462 (D.C. Cir.
1987) (\"Collateral estoppel will apply against the government only if
mutuality of parties exists.\"); [Hercules Carriers, Inc. v. Claimant
State of Fla.]{.underline}, 768 F.2d 1558, 1578-79 (11th Cir. 1985)
(applying [Mendoza]{.underline} and holding that nonmutual defensive
collateral estoppel cannot be applied to the state government); [Reich
v. D.C. Wiring, Inc.]{.underline}, 940 F. Supp. 105, 106-07 (D. N.J.
1996) (same as to the federal government).

Applying these procedural considerations, it is plain that AMC cannot
raise an actionable collateral estoppel defense against the United
States. The United States and AMC have only both been involved in
ADA-related litigation in two prior cases -- (i) an ADA action filed in
1992 by a private plaintiff against AMC ([Fiedler v. American
Multi-Cinema, Inc.]{.underline}) concerning the placement of wheelchair
locations at a sloped-floor theater in which the United States
participated as *amicus curiae,* and (ii) Cinemark's
previously-discussed APA-based action against the United States in which
AMC intervened as a party-plaintiff. ([See]{.underline} discussion
[supra]{.underline}, at 5-6, 9-10); [see]{.underline} [also]{.underline}
[Fiedler v. American Multi-Cinema, Inc.]{.underline}, C.A. No. 92-CV-484
(D.D.C. filed Feb. 26, 1992) (copy of PACER docket sheet, Ex. 22).
Neither of these cases satisfies the requirements for application of
collateral estoppel. First, with respect to [Fiedler]{.underline}, the
United States only participated as *amicus curiae* in this action.[^7]
It is well-established, however, that mere appearance as *amicus*
*curiae* falls far short of establishing the requisite amount of control
necessary to bind a non-party to a case by the doctrine of collateral
estoppel. [See]{.underline}, [e.g.]{.underline}, [Munoz v. County of
Imperial]{.underline}, 667 F.2d 811, 816-17 (9th Cir.
1982)(participation as *amicus* falls far short of control necessary to
actuate collateral estoppel); [Nat'l Fuel Gas Distrib. Corp. v. TGX
Corp.]{.underline}, 950 F.2d 829, 839 (2nd Cir. 1991)(appearance as
*amicus* generally insufficient to bind a party to judgment);
[Restatement]{.underline} § 39 cmt. c. In [Fiedler]{.underline},
moreover, no issues of fact or law were actually litigated and
determined by a valid and final judgment \-- as required by the
collateral estoppel doctrine \-- since the case was eventually dismissed
pursuant to a settlement agreement to which the United States, as
*amicus curiae*, was not a signatory. [See]{.underline},
[e.g]{.underline}., [Arizona v. California]{.underline}, 530 U.S. 392,
414 (2000) ("settlements ordinarily occasion no issue preclusion");
[Adams v. Bell]{.underline}, 711 F.2d 161, 195 n.123 (D.C. Cir. 1983)
(holding that application of collateral estoppel to consent judgments
was not appropriate because court had not resolved substance of the
issues contained in the consent decree) ([en]{.underline}
[banc]{.underline}).

AMC's reliance on the [Cinemark]{.underline} action for collateral
estoppel purposes is equally misplaced. As discussed previously, the
only issue actually litigated and necessarily decided by a final
judgment in this action was that the court lacked subject matter
jurisdiction to adjudicate the APA claims of both Cinemark and AMC.
([See]{.underline} discussion [supra]{.underline}, at 5-6, 9-10.) Thus,
the question decided in the [Cinemark]{.underline} case concerned the
United States' compliance with the APA, and this issue was decided ***in
the United States' favor***. Therefore, the only party in this
proceeding that can be collaterally estopped by the
[Cinemark]{.underline} decision is AMC, not the United States
([See]{.underline} discussion, [supra]{.underline}, at 9-10.)
Accordingly, summary judgment should be granted in favor of the United
States on AMC's collateral estoppel defense.

> **2. Res Judicata**

For the same reasons that the United States' claims are not collaterally
estopped, neither are they precluded by the doctrine of res judicata.
Res judicata prevents the litigation of "all grounds for, or defenses
to, recovery that were previously available to the parties,"
irrespective of whether they were asserted or decided in the prior
proceeding. [Robi v. Five Platters, Inc.]{.underline}, 838 F.2d 318, 322
(9th Cir. 1988)(quoting [Brown v. Felsen]{.underline}, 442 U.S. 127,
131, 99 S. Ct. 2205, 2209 (1979)). A later action can be barred under
the doctrine of res judicata only when "(1) the prior litigation
involved the same parties or their privies, (2) the prior litigation was
terminated by a final judgment on the merits, and (3) the prior
litigation involved the same 'claim' or 'cause of action' as the later
suit." [Hydranautics v. Filmtec Corp.]{.underline}, 204 F.3d 880, 888
(9th Cir. 2000); [see]{.underline} [also]{.underline} [Nordhorn v.
Ladish Co.]{.underline}, 9 F.3d 1402, 1404 (9th Cir. 1993). As discussed
above, [Fiedler]{.underline} satisfies none of these requirements since
the United States was not a party to this action, there was no final
judgment on the merits because of the parties' voluntary settlement of
the litigation, and, in any event, the case was litigated several years
before AMC had even constructed its first stadium-style theater, the
Grand 24. ([See]{.underline} discussion [supra]{.underline}, at 22-23,
n.7.) Turning to [Cinemark]{.underline}, this litigation also fails to
satisfy the requirements for application of the res judicata doctrine.
As discussed above, the only party to this action that is barred by the
[Cinemark]{.underline} judgment from litigating its claims is AMC. The
court in [Cinemark]{.underline} dismissed AMC's complaint in its
entirety and entered judgment in favor of the Department, in part
because this Court had also dismissed the identical APA-based claims.
([Cinemark]{.underline} Dismissal Order, Ex. 20.) Nonetheless, AMC
refuses to admit defeat, and instead has re-pled these exact same APA
and constitutional claims as affirmative defenses to this action.
([See]{.underline} discussion, *supra*, at 5-6.) Mere repetition,
however, cannot strengthen AMC's legally defective claims. This Court
should, therefore, grant summary judgment in favor of the United States'
on AMC's res judicata defense (Affirmative Defense No. 9).

> **H. [Damages and Civil Penalties Sought In This Action Are Not
> Subject To Mitigation (Affirmative Defense No. 10)]{.underline}**

AMC asserts in Affirmative Defense No. 10 that the United States' claims
are barred, in whole or in part, because the United States has failed to
mitigate damages. (Answer ¶ 46.) This defense, too, is without merit. As
applied to the United States' request for compensatory damages for
complainants who have been injured by AMC's violations of Title III, the
defense of mitigation is meritless. As applied to the United States'
request for statutorily-based civil penalties, this defense is
nonsensical. This Court should, therefore, grant the United States'
motion for summary judgment on AMC's Affirmative Defense No. 10.

As a general matter, parties injured by a legal wrong \-- whether in the
form of a tort, breach of contract, or act of employment discrimination
\-- are expected to mitigate their damages to the extent possible.
[See]{.underline}, [e.g]{.underline}., [Ford Motor Co. v.
EEOC]{.underline}, 458 U.S. 219, 231 n. 15, 102 S. Ct. 3057, n.15 (1982)
(citing C. McCormick, [Law of Damages]{.underline} 127-158 (1935));
[Sangster v. United Airlines, Inc.]{.underline}, 633 F.2d 864, 867 (9th
Cir. 1980); [Commodity Credit Corp. v. Rosenberg Bros. &
Co.]{.underline}, 243 F.2d 504, 511 (9th Cir. 1957). Thus, to
demonstrate that a plaintiff has failed to satisfy this duty, a
defendant must establish "(1) that the damage suffered by plaintiff
could have been avoided . . . and (2) that plaintiff failed to use
reasonable care and diligence" when seeking to minimize losses. [Sias v.
City Demonstration Agency]{.underline}, 588 F.2d 692, 696-97 (9th Cir.
1978). AMC, as the proponent of a mitigation defense, bears the burden
of proof regarding the adequacy of mitigation efforts by the United
States and/or individual theater patrons injured by AMC's ADA
violations. [See]{.underline} [Sangster v. United Airlines,
Inc.]{.underline}, 633 F.2d 864, 868 (9th Cir. 1980) (holding that
defendant-employer in Title VII action bore burden or proof regarding
mitigation defense to backpay award), [cert]{.underline}
[denied]{.underline}, 451 U.S. 971 (1981); [see]{.underline}
[also]{.underline} [Odima v. Westin Tucson Hotel]{.underline}, 53 F.3d
1484, 1497 (9th Cir. 1995) (same).

Application of the foregoing legal principles reveals that AMC has not
-- and cannot - demonstrate that disabled movie patrons and their
companions failed in any respect to mitigate their respective damages.
Under the ADA and its implementing regulations, such persons were
statutorily entitled not only to theater seating providing comparable
lines of sight as compared to other members of the general public (as
required by Standard 4.33.3), but also to accessible restrooms,
concession counters, ticket booths, parking lots and other features of
AMC's stadium-style theater complexes. [See]{.underline},
[e.g]{.underline}., 28 C.F.R. pt. 36, Appendix A (setting forth
accessibility guidelines for Title III-covered public accommodations and
commercial facilities). Having purchased theater tickets and
subsequently suffered various types of disability-based discrimination
at one or more of AMC's stadium-style movie theater complexes, there is
nothing these patrons could -- or should -- have done to "avoid" this
discrimination or otherwise lessen their respective damages. In fact, in
perhaps a tacit admission of the inapplicability of mitigation
principles to individual complaints in this action, AMC has never
proffered any evidence suggesting the means by which these individuals
could have mitigated their damages. Thus, the

mitigation defense as it relates to the individual complainants in this
action fails as a matter of law.

If AMC's mitigation defense is misplaced as it relates to individual
complainants, it is downright nonsensical with respect to the United
States' claims for civil penalties -- the only other relief sought by
the United States in this action that comes close to "damages." Section
12188(b)(2)(c) of the ADA confers on a court the authority to "assess a
civil penalty against the entity in an amount-- (i) not exceeding
\$50,000 for a first violation; and (ii) not exceeding \$100,000 for any
subsequent violation" in order to vindicate the public interest. There
is nothing in the text of this statutory provision that obligates the
United States to mitigate the penalties assessed by the Court against
AMC. In fact, the only Title III provision addressing mitigation of
civil penalties applies exclusively to ***defendant's*** conduct, by
allowing for judicial consideration of a discriminating party's good
faith efforts to comply with the ADA when assessing civil penalties. 42
U.S.C. § 12188(b)(5). This omission of mitigation language from the text
of the ADA's civil penalties provision must be presumed to be
intentional. [See]{.underline}, [e.g]{.underline}., [Russello v. United
States]{.underline}, 464 U.S. 16, 23, 104 S. Ct. 296, 300 (1983)
("\[W\]here Congress includes particular language in one section of a
statute but omits it in another section of the same Act, it is generally
presumed that Congress acts intentionally and purposefully in the
disparate inclusion or exclusion."); [Botosan v. Paul McNally
Realty]{.underline}, 216 F.3d 827, 832 (9th Cir. 2000). Accordingly,
summary judgment should be also be granted in favor of the United States
on AMC's tenth affirmative defense relating to the United States' demand
for civil penalties.

> **I. [AMC Is Independently Liable For Its Failure To Comply With The
> ADA Regardless of Any Negligence of Third-Party Architects or
> Contractors (Affirmative Defense No. 11)]{.underline}**

In Affirmative Defense No. 11, AMC claims that the "incident(s) alleged
by Plaintiff were caused by the negligence and/or fault of other
persons, corporations and entities and non-parties to this action,"
thereby reducing AMC's liability. (Answer ¶ 47.) This argument is
without merit. Regardless of whether AMC has a meritorious contract or
tort claim against its architects or contractors for their part in
designing or constructing non-compliant stadium-style theater complexes,
AMC -- as the owner, lessor, or operator of these facilities -- remains
independently liable for its failure to comply with the ADA.

There can be no question that AMC's stadium-style theater complexes at
issue in this litigation are covered by Title III's non-discrimination
mandate. ([See]{.underline} discussion [supra]{.underline}, at 2);
[see]{.underline} [also]{.underline} 42 U.S.C. 12181(7)(C) (defining the
term "public accommodation" to include "a motion picture house, theater,
concert hall, stadium, or other place of exhibition or entertainment").
Thus, the only question raised by AMC's Affirmative Defense No. 11 is
whether AMC can somehow escape or otherwise mitigate its liability under
the ADA by "pointing the finger" at third-parties (such as AMC's
"outside" architecture firms or contractors) for designing and/or
constructing non-compliant movie theaters. Both the ADA, its
implementing regulations, and other Department-issued guidance suggests
that the answer to this question is a resounding "no."

First, the text of the ADA makes plain that AMC cannot "contract away"
its statutory obligations or liability. Under the ADA, a public
accommodation is prohibited from subjecting "an individual or class of
individuals on the basis of a disability. . . *directly, or through
contractual, licensing, or other arrangements, to a denial of the
opportunity* . . . to participate in or benefit from the goods,
services, . . . or accommodations of an entity." 42 U.S.C. §
12182(b)(1)(A)(i) (emphasis added). The legislative history for this
provision explains that the reference in the statute to "contractual
arrangements" was included to ensure that an entity not be able to "do
indirectly through contractual arrangements what it is prohibited from
doing directly" under the ADA. H.R. Rep. No. 101-485 (II), at 104
(1990), *reprinted in* 1990 U.S.C.C.A.N. 387. In other words, "a covered
entity may not use a contractual provision to reduce any of its
obligations under \[the ADA\]." [Id.]{.underline}

Second, AMC's independent obligation to comply with the ADA is further
supported by the regulations implementing the ADA and other DOJ
regulatory guidance. Section 36.201(b) of the Department's regulations
implementing the ADA provides that both the landlord of a building that
houses a public accommodation and the tenant who owns or operates the
public accommodation are subject to Title III of the ADA, but that "as
between" the parties the allocation of responsibility for complying with
the obligations of the ADA may be determined by lease or contract. 28
C.F.R. § 36.201(b). Significantly, this section provides that the
allocation of responsibility is only effective *as between* the parties,
and thus any contractual allocation of responsibility has no effect on
the rights of third parties. [See]{.underline} [Botosan]{.underline},
216 F.3d at 833-34 (holding that allocations in lease agreement between
property owner and lessee did not transfer to lessee all liability for
ADA compliance); [Independent Living Resources v. Oregon Arena
Corp.]{.underline}, 982 F. Supp. 698, 767 (D. Or. 1997) (contractual
allocation of responsibility for ADA compliance has no effect on the
rights of third parties). Moreover, the Department of Justice's
interpretation of this section emphasizes that any allocation of
responsibility made in a contract is only effective as between the
parties, and that "both landlord and tenant remain fully liable for
compliance with all provisions of the ADA relating to that place of
public accommodation." Department of Justice, [Title III Technical
Assistance Manual]{.underline} § III-1.2000.[^8] Otherwise, owners of
public accommodations would be able to contract away their liability,
thereby severely impeding the enforcement of the statute and the ability
of third parties to obtain relief. [See]{.underline}
[Botosan]{.underline}, 216 F.3d at 834; [Independent Living
Resources]{.underline}, 982 F. Supp. at 768.[^9]

Accordingly, because AMC is, as a matter of law, independently liable
for the ADA violations alleged in the United States' Complaint, summary
judgment should be granted in favor of the United States as to
Affirmative Defense No. 11.

> **J. [AMC's Alleged Compliance with State or Local Building Codes Is
> Irrelevant to Its Compliance with the ADA (Affirmative Defense No.
> 12)]{.underline}**

In Affirmative Defense No. 12, AMC asserts that its conduct is
"privileged in that it was undertaken pursuant to the terms of the
applicable laws, regulations, orders and approvals relating to building
construction and/or public health and safety." (Answer, ¶ 48.) Even
assuming that the AMC stadium-style theaters at issue in this litigation
were indeed designed and constructed in compliance with state or local
building codes, such compliance does not, as a matter of law, immunize
AMC from liability under the ADA.

Defendants' reliance on compliance with state and local laws as an
affirmative defense to this action ignores the principle of federal
preemption. The Supremacy Clause of the Constitution, Art. VI, cl.2,
provides that "'the Laws of the United States which shall be made in
Pursuance' of the Constitution 'shall be the supreme law of the land.'
The phrase 'Laws of the United States' encompasses both federal statutes
themselves and federal regulations that are properly adopted in
accordance with statutory authorization." [City of New York v. Federal
Communications Comm'n]{.underline}, 486 U.S. 57, 63, 108 S. Ct. 1637,
1642 (1988). Under the Supremacy Clause, "\[s\]tate law is preempted
when it conflicts with federal law, would frustrate a federal scheme, or
where Congress clearly intended to occupy the field." [Saridakis v.
United Airlines]{.underline}, 166 F.3d 1272, 1276 (9th Cir. 1999).
Preemption may be express or implied, and "is compelled whether
Congress' command is explicitly stated in the statute's language or
implicitly contained in its structure and purpose." [Gade v. Nat'l Solid
Wastes Mgmt. Ass'n]{.underline}, 505 U.S. 88, 98, 112 S. Ct. 2374, 2383
(1992); [Fidelity Fed. Sav. & Loan Ass'n v. De La Cuesta]{.underline},
458 U.S. 141, 152-53, 102 S. Ct. 3014, 3022 (1982).

The text of the ADA makes clear that Congress intended to preempt state
or local laws that limit or reduce the obligations of public
accommodations under Title III of the ADA. Section 501(b) of the ADA
provides that "\[n\]othing in \[the ADA\] shall be construed to
invalidate or limit the remedies, rights, and procedures of any Federal
law or law of any State . . . that provides greater or equal protection
for the rights of individuals with disabilities than are afforded by
\[the ADA\]." 42 U.S.C. § 12201(b).[^10] By providing an express
exemption for those state laws that provide an equal or greater level of
protection than the ADA, Congress clearly expressed its intent to
preempt all laws that conflict with the ADA by providing lesser levels
of protection. [See]{.underline} [Wood v. County of
Alameda]{.underline}, 875 F. Supp. 659, 663 (N.D. Cal. 1995) (noting
that ADA was enacted to guarantee individuals with disabilities a
baseline level of protection). Thus, even if AMC could produce evidence
that local or state law or building codes "required" it to take actions
in violation of the ADA, federal law would still preempt any
"conflicting" state law or building codes. [See]{.underline} [Delil v.
El Torito Restaurants]{.underline}, No. C 94-3900, 1996 WL 807395, at
\*9 (N.D. Cal. Dec. 2, 1996)(stating in dicta that defendant may comply
with state and local building codes and still violate the ADA), Ex. 29.

> **K. [United States Is Authorized Under the Americans With
> Disabilities Act to Bring This Lawsuit Against AMC, and Has Satisfied
> All Jurisdictional Requirements (Affirmative Defense Nos. 17 &
> 25)]{.underline}**

In Affirmative Defense Nos. 17 & 25, AMC alleges that the United States
both\
failed to comply with the jurisdictional prerequisites and is acting
outside the scope of its authority when filing this action. (Answer ¶¶
53 & 61.) In essence, these affirmative defenses challenge the United
States' authority to bring this lawsuit. AMC's challenge to the United
States' authority to commence this action borders on the frivolous. As a
matter of law, the Department of Justice is charged with the authority
to investigate alleged violations of Title III and, as necessary,
commence enforcement actions against owners or operators of public
accommodations \-- such as AMC \-- for damages and/or civil penalties.
Accordingly, the Court should enter summary judgment in favor of the
United States with respect to AMC's Affirmative Defense Nos. 17 & 25.

That the Department of Justice (on behalf of the United States) was
empowered by the ADA to commence this enforcement action against AMC is
beyond peradventure. The Department of Justice, through the Attorney
General, is authorized to commence a civil action in any appropriate
United States District Court against persons or entities violating Title
III of the ADA. 42 U.S.C. § 12188(b)(1)(B). Such civil actions may be
initiated whenever the Attorney General has reasonable cause to believe
that (i) any person or entity is engaged in a "pattern or practice" of
discrimination, and/or that (ii) such person or entity has committed
acts of discrimination that "raises an issue or general importance." Id.
at § 12188(b)(1)(B)(i) - (ii). Indeed, the Department of Justice is the
only federal agency with authority to enforce Title III of the ADA,
which includes the new construction requirements at issue here.
[See]{.underline} 42 U.S.C. 12188(b)(1)(B).

Since the enactment of the ADA, the Department's enforcement authority
has been one of its key tools for enforcing both the statutory and
regulatory requirements of this Act. Here, the Attorney General had more
than "reasonable cause" to believe that AMC has engaged in a pattern or
practice of discrimination against individuals with disabilities through
the construction and operation of stadium-style theaters that, inter
alia, deny individuals who use wheelchairs and their companions access
to wheelchair and companion seating locations that provide lines of
sight comparable to those offered to members of the general public, and
that otherwise satisfy the accessibility requirements of Title III and
its implementing regulations. ([See]{.underline}, [e.g]{.underline}.,
Compl. ¶¶ 3, 19-20.) Because these actions involve a pattern or practice
of discrimination by AMC against persons with disabilities, and because
AMC's discriminatory conduct raises issues of general public importance,
the United States was authorized pursuant to § 12188(b)(1)(B) to
commence this action against AMC. As a matter of law, the United States
has thus complied with all statutory and jurisdictional requirements to
bring this action.

> **L. [The United States Is Not Barred From Litigating This Case Under
> the Doctrine of Unclean Hands (Affirmative Defense No.
> 23)]{.underline}**

Finally, AMC alleges that the United States' claims should be barred, in
whole or in part, by the doctrine of unclean hands. The defense of
unclean hands can only be asserted against the federal government when
the government's conduct is so egregious that it rises to the level of a
constitutional injury. [See]{.underline} [S.E.C. v. Sands]{.underline},
902 F. Supp. 1149 (C.D. Cal. 1995). Since AMC has proffered no evidence
of governmental wrongdoing in bringing this action -- let alone conduct
tantamount to a constitutional violation -- summary judgment should be
granted in favor of the United States on Affirmative Defense No. 23.

As a general proposition, the affirmative defense of unclean hands
precludes a plaintiff in a typical private action bars equitable relief
only if that plaintiff has engaged in bad faith or unconscionable
behavior that relates to the subject matter of the litigation and is
directed at the defendant. [See]{.underline}, [e.g]{.underline}.,
[Keystone Driller Co. v. General Excavator Co.]{.underline}, 290 U.S.
240, 244-45, 54 S. Ct. 146, 147 (1933); [Highmark, Inc. v. UMPC Health
Plan, Inc.]{.underline}, 276 F.3d 160, 174 (3rd Cir. 2001); [Adler v.
Nigeria]{.underline}, 219 F.3d 869, 877 (9th Cir. 2000). However, the
federal government is not a typical litigant. Unlike private parties,
the United States brings enforcement actions to serve the public
interest. Thus, in the Ninth Circuit, parties attempting to assert an
unclean hands defense must make the additional evidentiary showing that
the government's conduct was so outrageous or egregious as to cause
constitutional injury. [See]{.underline}, [e.g]{.underline}., [S.E.C. v.
Sands]{.underline}, 902 F. Supp. 1149, 1166 (C.D. Cal. 1995) (holding
that, in order to raise viable affirmative defense of unclean hands,
defendant was required to show such egregiousness by plaintiff
Securities and Exchange Commission that "the resulting prejudice to
defendant \[rose\] to a constitutional level") (quoting [SEC v.
Musella]{.underline}, 38 Fed.R.Serv.2d 426, 428 (S.D.N.Y. 1983)),
[aff'd]{.underline}, 142 F.3d 1186 (9th Cir. 1998), [cert]{.underline}.
[denied]{.underline}, 525 U.S. 1121 (1999).[^11] As the proponent of
this affirmative defense, AMC bears the heavy burden of establishing the
elements of this defense. [See]{.underline} Fed. R. Civ. P. 8(c);
[see]{.underline} [also]{.underline} [Pierce v. Apple Valley,
Inc.]{.underline}, 597 F. Supp. 1480, 1485 (S. D. Ohio 1984).

Plainly, AMC has not carried this heavy evidentiary burden. Several
years of fact discovery have been completed in this action. Yet AMC
still has not produced any evidence establishing that the Department's
conduct in bringing this action was so egregious as to cause
constitutional harm. Indeed, quite the contrary. For example, as
discussed previously, this Court has already (i) dismissed AMC's
APA-based counterclaim alleging that the Department failed to adhere to
requisite notice-and-comment procedures when promulgating Standard
4.33.3 ([see]{.underline} [supra]{.underline}, 4-5), and (ii)
conclusively determined that the United States has not issued
inconsistent interpretations of Standard 4.33.3 ([see]{.underline}
[supra]{.underline}, at 17). Furthermore, AMC has failed to make out the
elements for its constitutionally-based affirmative defenses.
([See]{.underline} discussion [supra]{.underline}, at 10-11 & n. 3.)

In light of the foregoing, this Court should dismiss AMC's affirmative
defense of unclean hands, since AMC has failed, as a matter of law, to
meet its burden of demonstrating that the United States' conduct in
bringing this lawsuit has prejudiced AMC to the level of constitutional
injury. [See]{.underline} [Fairbank v. Wunderman Cato
Johnson]{.underline}, 212 F.3d 528, 531 (9th Cir. 2000)(moving party's
summary judgment burden met by showing an absence of evidence to support
non-movant's case)(citing [Celotex Corp. v. Catrett]{.underline}, 477
U.S. at 325).

[IV. CONCLUSION]{.underline}

For the foregoing reasons, the United States' motion for partial summary
judgment as to AMC's Affirmative Defense Nos. 2-13, and 17-25 should be
granted and these defenses should be dismissed from this action with
prejudice.

DATED: September \_\_, 2002

> Respectfully submitted,
>
> RALPH F. BOYD, JR.
>
> Assistant Attorney General
>
> Civil Rights Division
>
> JOHN S. GORDON
>
> United States Attorney
>
> JOHN L. WODATCH, Chief
>
> RENEE M. WOHLENHAUS, Deputy Chief
>
> Disability Rights Section
>
> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> GRETCHEN E. JACOBS
>
> PHYLLIS M. COHEN
>
> KATHLEEN S. DEVINE
>
> DOV LUTZKER
>
> KRISTAN S. MAYER
>
> JOSEPH C. RUSSO
>
> Disability Rights Section
>
> Civil Rights Division
>
> U.S. Department of Justice
>
> Counsel for Plaintiff
>
> United States of America

[CERTIFICATE OF SERVICE]{.underline}

I hereby certify that on this \_\_ day of September, 2002, true and
correct copies of **Plaintiff United States' Memorandum in Support of
Motion for Partial Summary Judgment On AMC Defendants' Affirmative
Defenses** were served by Federal Express, postage pre-paid, on the
following parties:

Gregory F. Hurley

Kutak Rock LLP

Suite 1100

18201 Von Karman

Irvine, CA 92612-1077

Robert J. Harrop

Lathrop & Gage L.C.

Suite 2500

2345 Grand Boulevard

Kansas City, MO 64108-2684

> \_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_\_
>
> Kristan S. Mayer

[^1]: All exhibits referenced in this memorandum have been attached to
    the United States' Declaration and Exhibits in Support of Plaintiff
    United States' Motion for Partial Summary Judgment on Defendants'
    Affirmative Defenses.

[^2]: Indeed, this Court has already deemed its December 1999 Dismissal
    Order to be law of the case barring re-litigation of the question of
    whether the court had subject matter jurisdiction over AMC's APA
    claims. In June 2000, this Court dismissed then-defendant STK
    Architecture, Inc.'s APA-based counterclaim \-- a counterclaim that
    raised identical APA claims as AMC's then-dismissed counterclaim \--
    on the ground that its December 1999 Dismissal Order precluded
    re-litigation of the jurisdictional issues. ([See]{.underline} Order
    Granting Pl.'s Mot. to Dismiss STK's Countercl. (entered June 26,
    2000) (Docket \# 144).)

[^3]: Specifically, the constitutional issues raised by AMC's
    affirmative defenses include allegations of Fifth Amendment
    violations (Affirmative Defense No. 18), equal protection violations
    (Affirmative Defense No. 19), vagueness (Affirmative Defense No.
    20), overbreadth (Affirmative Defense No. 21), and impermissible
    retroactivity (Affirmative Defense No. 22). ([See]{.underline}
    Answer ¶¶ 54-57.)

[^4]: Of course, the United States does not concede AMC's claim that the
    Department has issued conflicting interpretations of Standard
    4.33.3. Indeed, Magistrate Judge Hillman already reached quite the
    opposite conclusion when limiting AMC's APA-related discovery in
    this action to the administrative record underlying the regulation:
    "Defendant has not shown inconsistent interpretations by plaintiff
    of § 4.33.3 with regard to commercial stadium style movie theaters."
    (Minute Order Denying Defs.' Mot. to Compel, at 3 (June 5,
    2000)(Docket #134).)

[^5]: AMC also asserts in Affirmative Defense No. 24 that the United
    States' claims are barred because AMC relied in "good faith on the
    law as it existed at the time of construction" of its facilities.
    (Answer ¶ 60.) To the extent AMC is claiming that the United States'
    interpretation of Standard 4.33.3 constitutes law upon which it has
    relied, the Court, as previously discussed, has held that none of
    the Department's actions in relation to Standard 4.33.3, including
    the filing of *amicus* briefs, corresponding with theater owners, or
    the filing of enforcement actions constitute final agency action,
    and therefore any analysis contained in those documents is not the
    law, but only the Department's interpretation of the law.
    ([See]{.underline} Dismissal Order at 17.) Moreover, the United
    States' interpretation of Standard 4.33.3 as applied to
    stadium-style theaters has remained consistent over time.
    Accordingly, summary judgment should be granted in favor of the
    United States as to Affirmative Defense No. 24 as well.
    ([See]{.underline} Minute Order Denying Defs.' Mot. to Compel
    Discovery, at 3 (June 5, 2000)(Docket #134)).

[^6]: Even if laches were an appropriate defense against the United
    States, AMC has failed to identify any facts showing that the United
    States unreasonable delayed in the initiation of this action or in
    any way caused AMC to be prejudiced in its defense of this case. In
    1998, the Department advised AMC that its theaters with
    stadium-style seating violated Title III of the ADA, and that the
    Civil Rights Division had been authorized to commence an enforcement
    action if voluntary conciliation efforts failed. (U.S. Facts ¶ 16.)
    Less than a year later, the United States commenced this action
    against AMC, and only then after efforts to resolve the matter
    proved unsuccessful. (U.S. Facts ¶ 18.) Thus, AMC has not and cannot
    establish that the United States unreasonably delayed commencement
    of this action or that AMC has been prejudiced by the timing of the
    Complaint.

[^7]: At issue in [Fiedler]{.underline} was AMC's placement of
    wheelchair seating at the back of each theater at the Avenue Grand
    Theater, a theater complex leased by AMC at Union Station in
    Washington, D.C.. [See]{.underline} [Fiedler v. American
    Multi-Cinema, Inc.]{.underline}, 871 F. Supp. 35 (D.D.C. 1994).
    Defendant AMC filed a motion for summary judgment contending that
    the ADA was inapplicable to its leased theaters at Union Station,
    that, even if the ADA did apply, that it did not require "dispersed"
    wheelchair seating at the Avenue Grand Theater, and that the ADA did
    not require equivalent treatment of disabled patrons when doing so
    would present a "direct threat" to the health or safety of other
    patrons. [See]{.underline} [id]{.underline}. at 36-37. With the
    permission of the court, the United States filed an *amicus* brief
    opposing AMC's motion for summary judgment. [Id.]{.underline} In
    this *amicus* brief, the United States contended that AMC's Avenue
    Grand Theater was indeed subject to the ADA; that AMC was required
    to provide more than one wheelchair seating location in theaters
    with more than 300 seats; and that AMC had failed to demonstrate
    that seating patrons who use wheelchairs towards the front of the
    theater would constitute a "direct threat." [Id.]{.underline} at
    37-40. The district court denied AMC's motion for summary judgment,
    [see]{.underline} [Fiedler]{.underline}, 871 F. Supp. at 40, and the
    parties subsequently settled the action. [See]{.underline} Ex. 22.

[^8]: The Ninth Circuit has held that the Department of Justice's
    interpretation of its own regulations, such as the Technical
    Assistance Manual, must "be given substantial deference and will be
    disregarded only 'if plainly erroneous or inconsistent with the
    regulation.'" [Bay Area Addiction Research & Treatment, Inc. v. City
    of Antioch]{.underline}, 179 F.3d 725, 732 (9^th^ Cir. 1999).

[^9]: Holding an owner or operator of public accommodations such as AMC
    independently liable for compliance with the ADA, irrespective of
    contractual agreements, does not impair that owner or operator's
    rights because, as noted by the Ninth Circuit, that party is always
    free to either proceed with the action and later seek
    indemnification or implead or move to join other potentially
    responsible third parties. [Botosan]{.underline}, 216 F.3d at 834;
    [Independent Living Resources]{.underline}, 982 F. Supp. at 768.

[^10]: Similarly, the Title III regulations provide that the "use of
    other designs and technologies are permitted where the alternative
    designs and technologies used will provide substantially equivalent
    or greater access to and usability of the facility." 28 C.F.R. Pt.
    36, App. A § 2.2.

[^11]: Indeed, some courts have concluded that the doctrine of unclean
    hands cannot be invoked at all against a governmental agency where,
    as here, that agency is acting in the public interest.
    [See]{.underline} [United States v. Second Nat'l Bank of North
    Miami]{.underline}, 502 F.2d 535, 548 (5th Cir. 1974),
    [cert.]{.underline} [denied]{.underline}, 421 U.S. 912 (1975); [SEC
    v. Rivlin]{.underline}, 1999 WL 1455758, at \*5 (D.D.C. Dec. 20,
    1999) (striking unclean hands defense on the ground that "the
    doctrine of unclean hands may not be invoked against the SEC"), Ex.
    27; [SEC v. Condron]{.underline}, 1985 WL 2054, at \*1 (D. Conn.
    June 11, 1985) ("\[C\]ourts have consistently held that the
    affirmative defense of unclean hands cannot be invoked against a
    government agency which is attempting to enforce the public
    interest."), Ex. 28.