IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF OREGON

ORACLE AMERICA, INC., 

a Delaware Corporation,

Plaintiff,

v.

THE OREGON HEALTH INSURANCE

EXCHANGE CORPORATION, dba

COVER OREGON, an Oregon

Limited Liability

Corporation, and THE STATE OF

OREGON, BY AND THROUGH THE

OREGON HEALTH AUTHORITY AND

THE OREGON DEPARTMENT OF

HUMAN SERVICES,

Defendants.

3:14-CV-01279-BR

 

OPINION AND ORDER 

BRENNA K. LEGAARD 

JEFFERY S. EDEN

Schwabe, Williamson & Wyatt, P.C.

1211 S.W. Fifth Avenue, Suite 1900

Portland, OR 97204

(503) 222-9981

KAREN JOHNSON-MCKEWAN

ROBERT S. SHWARTS

ERIN M. CONNELL

Orrick, Herrington & Sutcliffe LLP

The Orrick Building

405 Howard Street

San Francisco, CA 94105

(415) 773-5700

1 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 1 of 63
DORIAN E. DALEY

DEBORAH K. MILLER

PEGGY E. BRUGGMAN

Oracle Corporation

Legal Department

500 Redwood Shores, CA 94065

(650) 506-9534 

Attorneys for Plaintiff

DAVID B. MARKOWITZ 

PETER H. GLADE

LISA A. KANER

DALLAS S. DELUCA

HARRY B. WILSON

Markowitz Herbold PC

Suite 3000, Pacwest Center

1211 S.W. Fifth Avenue

Portland, OR 97204-3730

(503) 295-3085 

Attorneys for Defendants

BROWN, Judge.

This matter comes before the Court on Defendant State of

Oregon’s Motion (#92) for Summary Judgment, Plaintiff Oracle’s

Cross-Motion (#104) for Summary Judgment, and the Motion (#142)

of Defendant Department of Consumer and Business Services (DCBS)

for Judgment on the Pleadings. For the reasons that follow, the

Court DENIES the State of Oregon’s Motion for Summary Judgment,

GRANTS Oracle’s Cross-Motion for Summary Judgment, and GRANTS

DCBS’s Motion for Judgment on the Pleadings.

BACKGROUND

The parties are familiar with the facts underlying this

2 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 2 of 63
action. The Court, therefore, sets forth only the facts relevant

to the pending Motions.

At some point in 2009 the Oregon Legislature created the

Oregon Health Authority (OHA) as a division of the Oregon

Department of Human Services (DHS).

On March 23, 2010, Congress enacted the Patient Protection

and Affordable Care Act (ACA), Public Law No. 111–148, 124 Stat.

119 (2010), and thereby established legal foundations for States

either to create health-insurance exchanges (HIX) or to use an

HIX developed by the federal government.

The State of Oregon, through DHS/OHA, ultimately decided to

use Oracle to complete a Modernization Project and the HIX (the

Oracle Solution). Initially, however, DHS/OHA entered into an

agreement on June 30, 2011, only with Mythics, Inc., a

corporation that works with Oracle to distribute and to sell

Oracle products and to provide consulting on the implementation

and integration of Oracle’s products. That agreement, the

Mythics License and Services Agreement (MLSA),1

 provided in

pertinent part:

This agreement is governed by the substantive and

procedural laws of Oregon, without giving effect

to such state’s principles of conflicts of laws,

and you and Mythics agree to submit to the

exclusive jurisdiction of, and venue in, the

federal courts in Oregon, or the state courts in

1

 Although Oracle did not sign the MLSA, Oracle was named as

a third-party beneficiary of the MLSA. 

3 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 3 of 63
Salem, OR in any dispute arising out of or

relating to this agreement.

Agreed Facts (#88), Ex. 7 at § O.1. 

In June 2011 the Oregon Legislature passed legislation

creating the Oregon Health Insurance Exchange Corporation (Cover

Oregon)2 as a public corporation. Specifically, Oregon Revised

Statute § 741.002(1)(a) provided Cover Oregon shall "[a]dminister

a health insurance exchange in accordance with federal law to

make qualified health plans available to individuals and groups

throughout this state." 

In November 2011 DHS/OHA entered into an Oracle License

Service Agreement (OHA OLSA) with Oracle that provided in

pertinent part:

This agreement is governed by the substantive and

procedural laws of Oregon and you and Oracle agree

to submit to the exclusive jurisdiction of, and

venue in, if in state Courts, in the Circuit Court

of the State of Oregon for Marion County or, if in

federal courts, the United States District Court

for the District of Oregon, in any dispute arising

out of or relating to this agreement.

Agreed Facts (#88), Ex. 13 at § O.1. The OHA OLSA was signed by

the State of Oregon Chief Information Officer Carolyn Lawson,

Oregon Assistant Attorney General Jack McDonald, DHS/OHA Office

of Contracts and Procurement Officer Stella Transue, and Oracle

Contracts Manager Elizabeth Hwang. Agreed Facts (#88), Ex. 13 at

2

 On October 1, 2012, the Oregon Health Insurance Exchange

Corporation adopted the name Cover Oregon.

4 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 4 of 63
25.

As noted, Cover Oregon was not a party to the MLSA or the

OHA OLSA. On March 14, 2013, therefore, Cover Oregon and Oracle

executed an Oracle License and Services Agreement (Cover Oregon

OLSA) that provided in pertinent part:

This agreement is governed by the substantive and

procedural laws of Oregon and [Cover Oregon] and

Oracle agree to submit to the exclusive

jurisdiction of, and venue in, if in state Courts,

in the Circuit Court of the State of Oregon for

Marion County or, if in federal courts, the United

States District Court for the District of Oregon,

in any dispute arising out of or relating to this

agreement.

Second Am. Compl., Ex. B at ¶ O.1. The Cover Oregon OLSA was

signed by Cover Oregon Executive Director Howard King and Oracle

License Contracts Manager William Simpson. Second Am. Compl.,

Ex. B at 26.

In order for Oregonians to obtain insurance for 2014 as

required by the ACA, Cover Oregon established the goal of

launching the HIX by October 1, 2013. Although the HIX was not

ready to launch at that time, Oracle and Cover Oregon worked to

make the Oregon HIX useable and effective throughout 2013 and

into 2014.

On August 8, 2014, however, Oracle filed a Complaint against

Cover Oregon in this Court basing federal jurisdiction on the

parties' diversity of citizenship and asserting claims for breach

of contract and quantum meruit. Oracle alleged Cover Oregon has

5 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 5 of 63
not paid for all of the services that Oracle rendered,

"continue[s] to use Oracle's work product[,] and . . . has

transferred some or all of that work product to others in

violation of the parties' written agreements." 

On August 22, 2014, Cover Oregon filed a Motion to Dismiss

for Failure to State a Claim and Failure to Join Necessary and

Indispensable Party. Specifically, Cover Oregon sought dismissal

of the Federal Action because Oracle failed to sue the State of

Oregon, who, according to Cover Oregon, was a necessary and

indispensable party to the action.

On September 8, 2014, Oracle filed an Amended Complaint in

which Oracle added Oregon as a defendant and asserted claims for

copyright infringement against Cover Oregon and Oregon, breach of

contract against Cover Oregon, breach of the implied covenant of

good faith and fair dealing against Cover Oregon, and quantum

meruit against Cover Oregon and Oregon. 

On September 18, 2014, in light of Oracle's allegations in

its Corrected First Amended Complaint,3 the Court denied as moot

Cover Oregon's Motion to Dismiss for Failure to State a Claim and

Failure to Join Necessary and Indispensable Party and directed

Cover Oregon and/or Oregon to file any motions against the

3 On September 17, 2015, Oracle filed a Corrected First

Amended Complaint (#33) for the sole purpose of correcting the

erroneous reference to the Oregon Department of Human Services as

the Department of Health Services.

6 - OPINION AND ORDER

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Corrected First Amended Complaint no later than October 2, 2014.

On October 2, 2014, Oregon and Cover Oregon each filed

separate Motions to Dismiss Oracle's Corrected First Amended

Complaint as well as a Joint Motion to Dismiss or, in the

Alternative, to Stay.

On December 19, 2014, the Court heard oral argument on

Oregon's Motion to Dismiss; the Joint Motion to Dismiss or, in

the Alternative, to Stay filed by Oregon and Cover Oregon; and

Cover Oregon's Motion to Dismiss. The Court orally granted

Oregon's Motion to Dismiss, denied Cover Oregon's Motion to

Dismiss, and took the Joint Motion to Dismiss under advisement.

On January 13, 2015, the Court issued an Opinion and Order

in which it formally granted Oregon's Motion to Dismiss and

denied Cover Oregon's Motion to Dismiss with leave for Oracle to

file a Second Amended Complaint consistent with the Court's

rulings. Specifically, the Court concluded when Congress enacted

the Copyright Remedy Clarification Act, it did not abrogate the

States’ sovereign immunity to copyright actions pursuant to

Section 5 of the Fourteenth Amendment to the United States

Constitution; Oregon did not waive its sovereign immunity in the

action before this Court when it brought an action in state court

against Oracle and others alleging only state-law claims; and

Oracle did not establish that its claim against Oregon for

copyright infringement as alleged in its Corrected First Amended

7 - OPINION AND ORDER

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Complaint falls within the scope of the OHA OLSA contractual

provision. The Court granted Oracle leave to file a Second

Amended Complaint to the extent that it could allege facts to

establish that Oregon waived its sovereign immunity for the

copyright claim pursuant to the venue clause in the OHA OLSA. 

The Court also granted in part and denied in part the Joint

Motion to Dismiss as follows: (1) the Court denied the Joint

Motion to Dismiss Oracle's copyright-infringement claim on the

ground that Oracle failed to state a claim, (2) the Court granted

the Joint Motion to Dismiss Oracle's alternative Fourth Claim for

quantum meruit, and (3) the Court granted the Joint Motion to

Dismiss the Doe Defendants.

On January 27, 2015, Oracle filed a Second Amended Complaint

in which it asserted claims for copyright infringement against

Cover Oregon and Oregon; breach of the implied covenant of good

faith and fair dealing against Cover Oregon; and, in the

alternative to its claim for copyright infringement, claims for

breach of contract and quantum meruit against Cover Oregon.

On March 3, 2015, Oregon filed a Motion for Summary Judgment

in which it asserted the Eleventh Amendment of the United States

Constitution bars Oracle’s claim against it for copyright

infringement. On March 20, 2015, Oracle filed a Cross-Motion for

Summary Judgment on the issue of Eleventh Amendment immunity. 

The Court heard oral argument on the parties' Cross-Motions on

8 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 8 of 63
April 10, 2015. At the hearing the parties requested the Court

to reserve ruling on these Motions for Summary Judgment until it

decided the motion for judgment on the pleadings that was to be

filed shortly in order to ensure that the time for any appeal of

the summary-judgment rulings would not begin to run before the

time for any appeal began to run on the motion for judgment on

the pleadings.

In the meantime on March 6, 2015, the Oregon State

Legislature passed Senate Bill 1, which dissolved Cover Oregon

and moved its functions and duties to DCBS, an agency of the

State of Oregon. In particular, the legislation provides:

The rights, obligations and liabilities of [Cover

Oregon] legally incurred before [March 6, 2015]

are transferred to [DCBS]. [DCBS] is the

successor to those rights, obligations and

liabilities, notwithstanding any prohibition on

assignment contained in contracts assumed by

[DCBS] under sections 1 and 2 of this 2015 Act.

Senate Bill 1, § 6(3). In addition, § 6(3)(a) provides: 

Notwithstanding sections 1 to 5 of this 2015 Act,

the rights, obligations and liabilities

transferred to the department:

(a) Are subject to the limitations, defenses

and immunities of the department that arise under

ORS 30.260 to 30.300, the Eleventh Amendment to

the United States Constitution and other state and

federal laws.

Finally, according to Senate Bill 1, § 5, "the State of

Oregon, by and through [DCBS], is substituted for [Cover Oregon]"

in any pending litigation "involving or with respect to" the

9 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 9 of 63
"powers, rights, obligations and liabilities" of Cover Oregon's

Board and Executive Director. 

On April 14, 2015, Cover Oregon filed a Motion for Judgment

on the Pleadings in which it asserted Cover Oregon's "rights,

obligations and liabilities" were transferred to DCBS under

Senate Bill 1 as of March 6, 2015, and, accordingly, the State of

Oregon should be substituted for Cover Oregon in any pending

litigation. Cover Oregon also noted DCBS is an agency of the

State, and, therefore, DCBS is entitled to Eleventh Amendment

immunity as to Oracle's copyright claim. Thus, Cover Oregon

contended the Court should dismiss Oracle’s copyright claim

against Cover Oregon.

On May 5, 2015, Oracle filed an Unopposed Motion to

Substitute the State of Oregon, by and through the Department of

Consumer and Business Services, for Cover Oregon. On May 6,

2015, Oracle filed a Corrected Unopposed Motion to Substitute the

State of Oregon, by and through the Department of Consumer and

Business Services, for Cover Oregon. 

On June 5, 2015, the Court issued an Opinion and Order in

which it granted Oracle's Corrected Unopposed Motion to

Substitute the State of Oregon, by and through the Department of

Consumer and Business Services, for Cover Oregon and denied Cover

Oregon's Motion for Judgment on the Pleadings with leave to DCBS

to file its own motion for judgment on the pleadings no later

10 - OPINION AND ORDER

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than June 22, 2015.

On June 22, 2015, DCBS filed a Motion for Judgment on the

Pleadings in which it seeks dismissal of Oracle’s copyright claim

against DCBS on the ground that it is entitled to Eleventh

Amendment immunity as to that claim.

The Court heard oral argument on DCBS’s Motion for Judgment

on the Pleadings on September 3, 2015, and took the Motion under

advisement.

OREGON’S MOTION (#92) FOR SUMMARY JUDGMENT AND ORACLE’S

CROSS-MOTION (#105) FOR SUMMARY JUDGMENT

As noted, Oregon moves for summary judgment on Oracle’s

copyright-infringement claim on the ground that it is barred as

to the DHS/OHA under the Eleventh Amendment to the United States

Constitution. Oracle cross-moves for summary judgment on the

ground that Oregon waived Eleventh Amendment immunity for the

copyright claim as to DHS/OHA pursuant to § O.1 of the OHA OLSA

and/or § O.1 of the MLSA.4

I. Summary-Judgment Standard

Summary judgment is appropriate when “there is no genuine

dispute as to any material fact and the movant is entitled to

4

 At the April 10, 2015, oral argument Oracle asserted the

meaning of § O.1 in the OHA OLSA and § O.1 of the MLSA was

identical for purposes of immunity analysis and Oregon agreed. 

Accordingly, the Court will refer only to the OHA OLSA for

simplicity even though the Court’s analysis applies to both

contractual provisions.

11 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 11 of 63
judgment as a matter of law.” Washington Mut. Ins. v. United

States, 636 F.3d 1207, 1216 (9th Cir. 2011). See also Fed. R.

Civ. P. 56(a). The moving party must show the absence of a

dispute as to a material fact. Rivera v. Philip Morris, Inc.,

395 F.3d 1142, 1146 (9th Cir. 2005). In response to a properly

supported motion for summary judgment, the nonmoving party must

go beyond the pleadings and show there is a genuine dispute as to

a material fact for trial. Id. "This burden is not a light one.

. . . The non-moving party must do more than show there is some

'metaphysical doubt' as to the material facts at issue." In re

Oracle Corp. Sec. Litig., 627 F.3d 376, 387 (9th Cir. 2010)

(citation omitted). 

A dispute as to a material fact is genuine "if the evidence

is such that a reasonable jury could return a verdict for the

nonmoving party." Villiarimo v. Aloha Island Air, Inc., 281 F.3d

1054, 1061 (9th Cir. 2002)(quoting Anderson v. Liberty Lobby,

Inc., 477 U.S. 242, 248 (1986)). The court must draw all

reasonable inferences in favor of the nonmoving party. Sluimer

v. Verity, Inc., 606 F.3d 584, 587 (9th Cir. 2010). "Summary

judgment cannot be granted where contrary inferences may be drawn

from the evidence as to material issues." Easter v. Am. W. Fin.,

381 F.3d 948, 957 (9th Cir. 2004)(citation omitted). A “mere

disagreement or bald assertion” that a genuine dispute as to a

material fact exists “will not preclude the grant of summary

12 - OPINION AND ORDER

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judgment.” Deering v. Lassen Cmty. Coll. Dist., No. 2:07-CV1521-JAM-DAD, 2011 WL 202797, at *2 (E.D. Cal., Jan. 20, 2011)

(citing Harper v. Wallingford, 877 F.2d 728, 731 (9th Cir.

1989)). When the nonmoving party's claims are factually

implausible, that party must "come forward with more persuasive

evidence than otherwise would be necessary." LVRC Holdings LLC

v. Brekka, 581 F.3d 1127, 1137 (9th Cir. 2009)(citation omitted). 

The substantive law governing a claim or a defense

determines whether a fact is material. Miller v. Glenn Miller

Prod., Inc., 454 F.3d 975, 987 (9th Cir. 2006). If the

resolution of a factual dispute would not affect the outcome of

the claim, the court may grant summary judgment. Id.

II. Eleventh Amendment and Sovereign Immunity

A. General Standard

“Sovereign immunity, as it has been interpreted in the

federal courts, . . . encompasses two separate, but related,

concepts - . . . sovereign immunity . . . and Eleventh Amendment

immunity.” Magnolia Venture Capital Corp. v. Prudential Sec.,

Inc., 151 F.3d 439, 443 (5th Cir. 1998)(citing Seminole Tribe of

Fla. v. Fla., 517 U.S. 44, 54 (1996)). The Eleventh Amendment of

the United States Constitution provides: “The Judicial power of

the United States shall not be construed to extend to any suit in

law or equity, commenced or prosecuted against one of the United

States by Citizens of another State, or Citizens or Subjects of

13 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 13 of 63
any Foreign State.” The Supreme Court “has drawn upon principles

of sovereign immunity to construe the [Eleventh] Amendment to

establish that an unconsenting State is immune from suits brought

in federal courts by her own citizens as well as by citizens of

another state.” Port Auth. Trans-Hudson Corp. v. Feeney, 495

U.S. 299, 304 (1990)(quotations omitted). 

“The Eleventh Amendment bar to suit is not absolute. 

States may consent to suit in federal court and, in certain

cases, Congress may abrogate the States' sovereign immunity.” 

Id. (quotations omitted). In addition, a State may choose to

waive its immunity, thus consenting to suit. A State,

nevertheless, “may waive its . . . sovereign immunity without

waiving its Eleventh Amendment immunity.” Port Authority, 495

U.S. at 306. Thus, a State may consent to being sued in its own

courts, while still retaining Eleventh Amendment immunity from

suit in federal court. See, e.g., Fla. Dep’t of Health and

Rehabilitative Servs. v. Fla. Nursing Home Ass'n., 450 U.S. 147,

150 (1981)(State's general waiver of sovereign immunity did not

constitute a waiver by the State of its Eleventh Amendment

immunity).

B. Waiver Standard

As noted, Oracle asserts Oregon waived the Eleventh

Amendment immunity of DHS/OHA as to Oracle’s copyrightinfringement claim in § O.1 of the OHA OLSA. The Supreme Court

14 - OPINION AND ORDER

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summarized the issue of waiver of immunity in Florida Prepaid

Postsecondary Education Expense Board v. College Savings Bank:

We have long recognized that a State's . . .

immunity is a personal privilege which it may

waive at its pleasure. The decision to waive that

immunity, however, is altogether voluntary on the

part of the sovereignty. Accordingly, our test

for determining whether a State has waived its

immunity from federal-court jurisdiction is a

stringent one. Generally, we will find a waiver

either if the State voluntarily invokes our

jurisdiction or else if the State makes a clear

declaration that it intends to submit itself to

our jurisdiction. Thus, a State does not consent

to suit in federal court merely by consenting to

suit in the courts of its own creation. Nor does

it consent to suit in federal court merely by

stating its intention to sue and be sued or even

by authorizing suits against it in any court of

competent jurisdiction. 

527 U.S. 627, 675-76 (1999)(quotations omitted). “The Supreme

Court has made it clear that [courts] may find a waiver of a

State's Eleventh Amendment immunity in only the most exacting

circumstances. ‘[T]he State's consent [to suit in federal court

must] be unequivocally expressed.’” Magnolia, 151 F.3d at 443

(quoting Pennhurst State Sch. & Hosp. v. Halderman, 465 U.S. 89,

99 (1984)). “[S]olicitude for States' . . . immunity underlies

the standard that this Court employs to determine whether a State

has waived that immunity. The Court will give effect to a

State's waiver of Eleventh Amendment immunity only where stated

by the most express language or by such overwhelming implication

from the text as [will] leave no room for any other reasonable

construction.” Port Authority, 495 U.S. at 305-06.

15 - OPINION AND ORDER

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In addition, the Supreme Court and the Ninth Circuit

have held there cannot be any waiver of Eleventh Amendment

immunity “by implication or by use of ambiguous language.” 

United States v. N.Y. Rayon Importing Co., 329 U.S. 654, 659

(1947). See also Holley v. Cal. Dep’t of Corr., 599 F.3d 1108,

1112 (9th Cir. 2010)(same). Courts must “indulge every

reasonable presumption against waiver.” Fla. Prepaid, 527 U.S.

at 682. Any ambiguity in the existence of a waiver of immunity

or in the scope of a waiver of immunity “must be construed

strictly in favor of the sovereign and not enlarged beyond what

the . . . language requires.” United States v. Nordic Village,

Inc., 503 U.S. 30, 34 (1992)(citations and quotations omitted). 

See also F.A.A. v. Cooper, 132 S. Ct. 1441, 1448 (2012)(same). 

Finally, a “state's waiver must be accomplished by

someone to whom that power is granted under state law.” Ford

Motor Co. v. Dep’t of Treasury, 323 U.S. 459, 467 (1945),

overruled on other grounds by Lapides v. Bd. of Regents of Univ.

Sys. of Ga., 535 U.S. 613, 623 (2002).

III. Provisions of the OHA OLSA at Issue

A. Applicability of OHA OLSA Provisions to Oracle’s Claim

against DHS/OHA for Copyright Infringement

As noted, the OHA OLSA contains the following

provision:

This agreement is governed by the substantive and

procedural laws of Oregon and you and Oracle agree

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to submit to the exclusive jurisdiction of, and

venue in, if in state Courts, in the Circuit Court

of the State of Oregon for Marion County or, if in

federal courts, the United States District Court

for the District of Oregon, in any dispute arising

out of or relating to this agreement.

Agreed Facts, Ex. 13 at § O.1 (emphasis added).

In its Second Amended Complaint Oracle alleges the

following with respect to the OHA OLSA and Oregon’s liability for

copyright infringement:

71. An express condition precedent to any license

to Cover Oregon under the Cover Oregon OLSA was

that it was required to pay for all services

rendered under the OLSA. Cover Oregon has not

satisfied that express condition precedent,

because Cover Oregon has not paid for all of the

services rendered under the Cover Oregon OLSA. 

Accordingly, Cover Oregon has no license at all to

the Copyright Assets and is not authorized to

reproduce, prepare derivative works of,

distribute, or publicly display those works, or to

authorize others to do so. 

72. By continuing to operate the Cover Oregon

website, Cover Oregon is infringing Oracle’s

exclusive rights to reproduce and publicly display

the work.

73. By transferring Oracle’s Copyright Assets to

the control of the State of Oregon for further

development, Cover Oregon has unlawfully

distributed the Copyright Assets, and has

unlawfully authorized others to prepare derivative

works based on the Copyright Assets, thereby

infringing Oracle’s exclusive rights. 

74. By accepting the transfer of source code from

Cover Oregon and exercising dominion and control

over a project to augment that code, the State of

Oregon has infringed Oracle’s exclusive rights to

reproduce and to prepare derivative works of the

Copyright Assets. Oregon has claimed a license to

all or part of the Copyright Assets based on the

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OHA OLSA, but that license does not allow

preparation of derivative works from the Copyright

Assets.

Second Am. Compl. at ¶¶ 71-74 (emphasis added). Oracle

acknowledges the Court’s January 13, 2015, conclusion that

Congress did not abrogate States’ Eleventh Amendment immunity for

copyright-infringement claims when it enacted the Copyright

Remedy Clarification Act (CRCA), Pub.L. 101-553, 104 Stat. 2749

(1990). Oracle also concedes the claim at issue here is one for

copyright infringement rather than for breach of contract. 

Nevertheless, Oracle asserts its copyright-infringement claim

“relates to” the OHA OLSA, and, therefore, § O.1 applies to the

dispute and waives DHS/OHA’s Eleventh Amendment immunity as to

that claim.

The Ninth Circuit has held “in some circumstances, a

contractual forum selection clause may also apply to related

non-contract claims.” Petersen v. Boeing Co., 715 F.3d 276, 283

n.7 (9th Cir. 2013). Specifically, contractual forum-selection

clauses may apply to noncontract claims “only when ‘resolution of

the [noncontract] claims relates to interpretation of the

contract.’” Id. (quoting Manetti–Farrow, Inc. v. Gucci Am.,

Inc., 858 F.2d 509, 514 (9th Cir. 1988)). 

Resolution of noncontract claims “relates to”

interpretation of the contract when the noncontract “claims

require interpretation of the contract”; i.e., the noncontract

18 - OPINION AND ORDER

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claims “cannot be adjudicated without analyzing whether the

parties were in compliance with the contract.” Manetti-Farrow,

858 F.2d at 514 (citation omitted). See also Kwiecinski v.

Medi-Tech Intern. Corp., No. 3:14–CV–01512–BR, 2015 WL 3905224,

at *3 (D. Or. June 25, 2015)(same); Simula, Inc. v. Autoliv,

Inc., 175 F.3d 716 (9th Cir. 1999); Mediterranean Enter., Inc. v.

Ssangyong Corp., 708 F.2d 1458, 1464 (9th Cir. 1983).

The Court notes Oracle alleges in its claim against

DHS/OHA for copyright infringement that Oregon asserts it had a

license to all or part of the copyright assets based on the OHA

OLSA and, in turn, that Oregon’s license does not allow

preparation of derivative works from the copyright assets. 

In light of these allegations, the Court concludes

resolution of Oracle’s copyright-infringement claim against

DHS/OHA will require the Court to analyze the terms and

provisions of the OHA OLSA. Accordingly, § O.1 of the OHA OLSA

“relates to” Oracle’s copyright-infringement claim against

DHS/OHA.

B. Legal Authority

As noted, Oracle asserts § O.1 of the OHA OLSA

establishes that Oregon waived its Eleventh Amendment immunity as

to Oracle’s copyright-infringement claim against DHS/OHA. 

According to Oregon, however, § O.1 does not contain “the most

express language” nor is there “such overwhelming implication

19 - OPINION AND ORDER

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from the text as to leave no room for any . . . reasonable

construction” of that provision sufficient to establish that

Oregon waived its Eleventh Amendment immunity.

The Court and the parties agree there are few cases in

which courts have analyzed waiver of Eleventh Amendment immunity

in the context of a contract nor is there is any Ninth Circuit

precedent on the issue. It is also agreed that the Supreme Court

set out the framework for such analysis in Port Authority. In

addition, Oracle relies heavily on two other cases to support its

position: Pettigrew v. Oklahoma, 722 F.3d 1209 (10th Cir. 2013),

and Baum Research and Development Company v. University of

Massachusetts, 503 F.3d 1367 (Fed. Cir. 2007), while Oregon

contends these cases are distinguishable.

1. Port Authority v. Feeney

The parties agree the Supreme Court set out the

framework for analysis of waiver of Eleventh Amendment immunity

in Port Authority. In that case New York and New Jersey entered

into a bistate compact in 1921 that created the Port Authority of

New York and New Jersey Authority (PATH). Feeney and Foster

brought separate actions against a subsidiary of PATH in the

United States District Court for the Southern District of New

York for injuries that they allegedly incurred during their

employment with PATH. PATH filed motions to dismiss in both

actions on the ground of Eleventh Amendment immunity. The

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district court granted PATH’s motions to dismiss relying in part

on a Third Circuit case in which the court concluded PATH was

entitled to Eleventh Amendment immunity. 495 U.S. at 302. The

Second Circuit Court of Appeals, however, reversed the district

court’s dismissal of the actions. The Supreme Court accepted

certiorari to resolve the conflict between the circuits as to

PATH’s immunity. The Supreme Court ultimately held New York and

New Jersey had waived PATH’s Eleventh Amendment immunity through

provisions in Acts passed by New York and New Jersey in 1951 that

governed lawsuits against the Port Authority and its

subsidiaries. Specifically, the Supreme Court noted “New York

and New Jersey . . . expressly consented to suit in expansive

terms” in the 1951 Acts. 495 U.S. at 306. The 1951 Acts

provided in pertinent part that “the States ‘consent to suits,

actions, or proceedings of any form or nature at law, in equity

or otherwise . . . against the Port of New York Authority.’” Id.

(quoting N.J. Stat. Ann. § 32:1–157 and N.Y. Unconsol. Laws 

§ 7101). The Court noted the consent provision “might be

interpreted to encompass the States' consent to suit in federal

court as well as state court.” Id. at 306. The Supreme Court,

however, found it was equally likely that “such a broadly framed

provision may . . . reflect only a State's consent to suit in its

own courts.” Id. The provision standing alone, therefore, was

ambiguous. The Court reiterated it has previously “required 

21 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 21 of 63
. . . consent to suit in federal court be express and thus has

construed such ambiguous and general consent to suit provisions,

standing alone, as insufficient to waive Eleventh Amendment

immunity.” Id. The Court also noted, however, that “[o]ther

textual evidence of consent to suit in federal courts may resolve

that ambiguity and sufficiently clearly establish the scope of

the State's more general consent to suit[, in which case] the

Court must give effect to that clearly indicated consent to suit

in federal court.” Id. at 306-07. The Court then looked to the

rest of the 1951 Acts in an effort to resolve the ambiguity and

“to clearly establish the scope of the States’ more general

consent to suit.” Id. at 306. In particular, the Court examined

the venue provisions of the 1951 Acts, which provided: 

The foregoing consent [of N.J. Stat. Ann. 

§ 32:1–157; N.Y. Unconsol. Laws § 7101] is granted

upon the condition that venue in any suit, action

or proceeding against the Port Authority shall be

laid within a county or a judicial district,

established by one of said States or by the United

States, and situated wholly or partially within

the Port of New York District.

Id. at 306. 

Ultimately the Court concluded “the statutory

venue provision suffices to resolve any ambiguity contained in

the States' general consent to suit provision by expressly

indicating that the States' consent to suit extends to suit in

federal court.” Id. at 307. Specifically, the Court explained:

[W]e believe that the provision directly indicates

22 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 22 of 63
the extent of the States' waiver embodied in the

consent provision. The States passed the venue

and consent to suit provisions as portions of the

same Acts that set forth the nature, timing, and

extent of the States' consent to suit. The venue

provision expressly refers to and qualifies the

more general consent to suit provision. 

Additionally, issues of venue are closely related

to those concerning sovereign immunity, as this

Court has indicated by emphasizing that “[a]

State's constitutional interest in immunity

encompasses not merely whether it may be sued, but

where it may be sued.” . . . The venue provision

would hardly qualify “[t]he foregoing consent”

unless the States intended that consent to include

suits in federal court.

Id. at 307-08. Finally, the Court noted PATH 

suggests no reasonable construction that might be

given to the venue provision's phrase, ‘judicial

district, established . . . by the United States,’

other than that the States consented to suit in

federal court. . . . [PATH] essentially presents

the choice between giving the venue provision its

natural meaning and giving the provision no

meaning at all. Charged with giving effect to the

statute, we do not find the choice to be a

difficult one. 

Id. at 308 (quotation omitted).

Based on Port Authority, Oracle asserts § O.1 of

the OHA OLSA combined with Oregon’s general consent to suit found

in the Oregon Tort Claims Act (OTCA), Oregon Revised Statute 

§ 30.265, and Oregon Revised Statute § 30.3205

 are sufficient to

establish that Oregon waived its Eleventh Amendment immunity as

5

 Oregon Revised Statute § 30.320 provides in pertinent

part: “A suit or action may be maintained . . . against the

State of Oregon by and through and in the name of the appropriate

state agency upon a contract made by . . . such agency and within

the scope of its authority.”

23 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 23 of 63
to Oracle’s copyright-infringement claim against DHS/OHA. 

Specifically, Oracle notes the OTCA, like the general consent to

suit in the 1951 Acts at issue in Port Authority, provides a

broad, general consent to suit. See Or. Rev. Stat. § 30.265

(“[E]very public body is subject to civil action for its torts 

. . . whether arising out of a governmental or proprietary

function.”). According to Oracle, § O.1 of the OHA OLSA, like

the venue provision in the 1951 Acts at issue in Port Authority,

elucidates the broad consent-to-suit provision in the OTCA and

establishes Oregon consented to suit in federal court.

Oregon, on the other hand, asserts the

circumstances in Port Authority are distinguishable. 

Specifically, Oregon notes when the Supreme Court decided the

venue provision of the 1951 Acts resolved any ambiguity in the

States’ general consent to suit in those Acts, the Court pointed

out that “[t]he States passed the venue and consent to suit

provisions as portions of the same Act that set forth the nature,

timing, and extent of the States' consent to suit. The venue

provision expressly refers to and qualifies the more general

consent to suit provision.” Port Authority, 495 U.S. at 307. 

Here, however, Oregon notes the parties drafted and entered into

the OHA OLSA relatively recently while the general consent to

suit found in the OTCA occurred almost 50 years ago. Oregon also

points out that unlike the venue provision in Port Authority,

24 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 24 of 63
which specifically stated “[t]he foregoing consent . . . is

granted upon the condition that. . .,” § O.1 of the OHA OLSA does

not reference the OTCA or Oregon’s general consent to suit under

§ 30.320. Oregon emphasizes the Supreme Court’s statement in

Port Authority that “[t]he venue provision would hardly qualify

‘[t]he foregoing consent’ unless the States intended that consent

to include suits in federal court.” Id. at 308. Thus, Oregon

contends § O.1 remains ambiguous absent coupling with the OTCA,

and, therefore, § O.1 must be construed in favor of Oregon. 

Finally, Oregon asserts it has offered another

reasonable construction of § O.1: Specifically, Oregon notes 

§ O.1 is phrased conditionally (“submit to the exclusive

jurisdiction of, and venue in, if in state Courts, in the Circuit

Court of the State of Oregon for Marion County or, if in federal

courts, the United States District Court for the District of

Oregon”), which, according to Oregon, suggests the provision

requires jurisdiction and venue in the District of Oregon only to

the extent that the parties “have an antecedent and independent

legal basis to be in federal court.” Oregon contends there are

at least three ways in which the State and Oracle could be

involved in litigation in federal court that would implicate 

§ O.1 even if Oregon did not waive its immunity: (1) If the

Ninth Circuit holds the CRCA abrogates States’ Eleventh Amendment

25 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 25 of 63
immunity to copyright actions in federal court;6 (2) if Oregon is

the plaintiff in a federal claim because the Ninth Circuit has

held “a state that voluntarily brings suit [on a federal claim]

as a plaintiff in state court cannot invoke the Eleventh

Amendment when the defendant seeks removal to a federal court of

competent jurisdiction,” Cal. ex rel. Lockyer v. Dynegy, Inc.,

375 F.3d 831, 845 (9th Cir. 2004); and/or (3) if Oregon

voluntarily appears and defends an action in federal court on the

merits. See Fordyce v. City of Seattle, 55 F.3d 436, 441 (9th

Cir. 1995) (A State can “waive Eleventh Amendment protection by

voluntarily appearing and defending [a suit in federal court] on

the merits.”). Oregon asserts § O.1 would establish jurisdiction

and venue in this Court in any of those situations as opposed to

a federal court in some other jurisdiction. According to Oregon,

therefore, unlike PATH in Port Authority, Oregon has offered

another reasonable construction of § O.1. 

In its Reply to its Cross-Motion for Summary

Judgment, Oracle, however, asserts that Oregon’s allegedly

reasonable alternative construction of the meaning of § O.1 is,

in fact, unreasonable, and Port Authority directs the Court to

find Oregon waived Eleventh Amendment immunity as to Oracle’s

6

 As this Court noted in its January 13, 2015, Opinion and

Order, there is not any controlling Ninth Circuit precedent as to

whether Congress validly abrogated States’ Eleventh Amendment

immunity to copyright actions when it enacted the CRCA. This

Court decided Congress did not do so.

26 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 26 of 63
copyright-infringement claim against DHS/OHA. 

2. Pettigrew v. Oklahoma

In Pettigrew the plaintiff brought an action in

federal court against Oklahoma’s Department of Public Safety

(DPS) alleging claims for retaliation in violation of Title VII

and negligent supervision. The parties settled the matter in

December 2010 and executed a General Release and Settlement

Agreement, which contained the following provision:

The laws of the State of Oklahoma shall govern

interpretation of this Agreement. In the event

that any litigation is commenced by either party

to enforce the terms and conditions of the

Agreement, the litigation will be brought in the

appropriate Oklahoma court having jurisdiction,

either state or federal.

722 F.3d at 1211 (emphasis in original). In January 2012 the

plaintiff filed a second action against DPS in federal court in

which he alleged: (1) DPS violated Title VII by retaliating

against the plaintiff, (2) the alleged retaliation breached the

Settlement Agreement, and (3) the plaintiff was entitled to a

declaratory judgment that DPS had breached the Agreement. Id. at

1212. DPS moved to dismiss the plaintiff’s second and third

claims on the ground that they were barred by Eleventh Amendment

immunity. The plaintiff asserted the district court had

supplemental jurisdiction over the state-law claims and that DPS

had waived its Eleventh Amendment immunity as to those claims via

27 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 27 of 63
the provision in the Settlement Agreement.7 The district court

denied the motion to dismiss, and DPS appealed. On appeal the

plaintiff, relying on Port Authority, asserted the language in

the Settlement Agreement that any litigation “will be brought in

the appropriate Oklahoma court having jurisdiction state or

federal” unequivocally indicated DPS’s intent to waive Eleventh

Amendment immunity for actions to enforce the Settlement

Agreement. The Tenth Circuit noted Oklahoma has “broadly

consent[ed] to suit[s] to enforce the terms of a contract entered

into by the state.” Id. at 1214-15 (citing State Bd. of Pub.

Affairs v. Principal Funding Corp., 542 P.2d 503, 506 (1975)). 

The Tenth Circuit found “[t]here is no question that [DPS]

consented to being sued under the [Settlement] Agreement, at

least in state court. . . . The only unsettled question would be

whether the state could be sued in federal court for breach of

the Agreement.” Id. at 1215 (emphasis in original). DPS focused

on the word “appropriate” and asserted the only appropriate

Oklahoma court having jurisdiction over the plaintiff’s state-law

claims was Oklahoma’s state court because the Eleventh Amendment

bars the federal court from hearing those claims. The Tenth

Circuit interpreted DPS’s position as an assertion that “the word

‘appropriate’ voids the words ‘or federal’” and stated:

7

 The Supreme Court has held supplemental jurisdiction under

28 U.S.C. § 1367 does not override the Eleventh Amendment.

28 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 28 of 63
In Oklahoma, contracts should be construed so as

to give effect to every part, if reasonably

practicable. Rejecting the state's interpretation

is not a difficult choice. The language “or

federal” clearly signals that the word appropriate

must be read as not taking Eleventh Amendment

immunity into account. The word refers only to

proper subject-matter and personal jurisdiction

and, perhaps, venue. Because a federal court can

have supplemental jurisdiction over a state-law

contract claim, see 28 U.S.C. § 1367(a), a federal

court can be an appropriate court.

Id. at 1215-16 (emphasis in original)(quotation and citation

omitted). The Tenth Circuit noted:

One might argue . . . the reference in the Venue

Provision to “either state or federal” courts

could be read merely as acknowledging that the

Agreement could be enforced in federal court if

the state's immunity were not an obstacle for some

reason independent of anything in the Agreement. 

If that is the meaning, however, why include the

language? True, the state could waive its

Eleventh Amendment immunity by other means, such

as by removing a suit to federal court. But we

firmly doubt that the parties would include a

provision allowing suit in federal court only if

the state happened to prefer federal court at some

point in the future. . . . And the “state or

federal” language would be pointless if it simply

recited the venues where a suit could be brought

anyway.

Id. at 1216.

Oregon asserts Pettigrew is distinguishable from

this case on the ground that there was not any reasonable

alternative interpretation for the venue provision in Pettigrew

other than as a waiver of Eleventh Amendment immunity because the

provision applied only to breach-of-contract claims to enforce

the terms and conditions of the contract and such claims cannot

29 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 29 of 63
be asserted against a State in federal court unless the State

waives its Eleventh Amendment immunity. Oregon contends there

was not any risk in Pettigrew of venue being in a federal forum

other than the District of Oklahoma because both the plaintiff

and the defendant were citizens of Oklahoma and all of the

relevant events occurred in Oklahoma. In contrast, § O.1 applies

to “any claims arising out of or related to” the OHA OLSA. 

Oregon, therefore, contends it was necessary in this case for the

parties specifically to choose venue in the District of Oregon

for potential federal claims that purportedly abrogate Oregon’s

Eleventh Amendment immunity rather than risk venue in a different

federal court. Thus, although there was not any reasonable

construction of the venue provision in Pettigrew other than as a

waiver of Eleventh Amendment immunity, Oregon contends it has

offered a reasonable alternative construction of § O.1.

3. Baum Research and Development Co. v. University of

Massachusetts

Oracle also relies on Baum to support its

assertion that § O.1 is not ambiguous and that it waives Oregon’s

Eleventh Amendment immunity to Oracle’s copyright-infringement

claim against DHS/OHA. In Baum the defendant and the plaintiff,

the holder of the two patents at issue, entered into a licensing

agreement that contained the following provision:

This Agreement will be construed, interpreted and

applied according to the laws of the State of

Michigan and all parties agree to proper venue and

30 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 30 of 63
hereby submit to jurisdiction in the appropriate

State or Federal Courts of Record sitting in the

State of Michigan.

503 F.3d at 1368. The plaintiff filed an action in the United

States District Court for the Western District of Michigan

against the defendant alleging claims for patent infringement and

breach of the licensing agreement. The defendant moved to

dismiss the plaintiff’s complaint based on Eleventh Amendment

immunity. The district court denied the defendant’s motion on

the ground that the defendant waived its immunity in the

licensing agreement. The defendant appealed. On appeal the

Federal Circuit rejected the defendant’s assertion that the

provision was ambiguous and that it did not waive immunity

because the provision could “also be read not as a waiver of

immunity from suit, but merely an acceptance of venue in

Michigan, if [the plaintiff] can somehow overcome the obstacle of

the University's immunity.” 503 F.3d at 1370. The Federal

Circuit concluded:

[T]he contract terms are clear, . . . the

University agreed to submit to the jurisdiction of

a federal court in Michigan as to disputes arising

from this contract. Although the University

argues that the contract does not state which

court is “appropriate” as to which cause of action

as may arise, this does not negate the agreement

to submit to the jurisdiction of the appropriate

court.

Id. at 1370. The court also concluded the provision met the

criteria of Port Authority for establishing a waiver of Eleventh

31 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 31 of 63
Amendment immunity. Id. at 1370-71.

Oregon asserts Baum is distinguishable because 

§ O.1 is phrased in the conditional: If a dispute is in federal

court, then the parties agree to venue in and the jurisdiction of

the District of Oregon. Thus, according to Oregon, § O.1 only

selects venue in the event that a case is already in federal

court and does not provide for the necessary predicate consent to

suit. The court in Baum, however, rejected a similar argument

from the defendant (i.e., that the contract provision at issue

could be read “not as a waiver of immunity from suit, but merely

an acceptance of venue in Michigan, if [the plaintiff could]

somehow overcome the obstacle of [the defendant’s] immunity”). 

The court reasoned: “Although [the defendant] argues that the

contract does not state which court is ‘appropriate’ as to which

cause of action as may arise, this does not negate that agreement

to submit to the jurisdiction of the appropriate court.” 503

F.3d at 1370. 

C. Waiver Analysis

As noted, the Supreme Court and the Ninth Circuit have

made clear that there cannot be a waiver "by implication or by

use of ambiguous language." N.Y. Rayon Importing Co., 329 U.S.

at 659; Holley, 599 F.3d at 1112. Oregon asserts the language in

§ O.1 either clearly did not waive Oregon’s Eleventh Amendment

immunity or is ambiguous, and, therefore, § O.1 must be

32 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 32 of 63
interpreted in favor of Oregon. Oracle, in turn, asserts § O.1

is a clear waiver of Eleventh Amendment immunity as to Oracle’s

copyright-infringement claim against DHS/OHA. Under Oregon law

[w]hen . . . interpret[ing] any written instrument,

[the court's] objective is to ascertain the meaning

that most likely was intended by the parties that

entered into it. . . . [The court] ascertain[s] the

meaning most likely intended by the parties by means of

a three-step inquiry. [The court] begin[s] with the

text of the disputed provision in the context of the

instrument as a whole. In examining the text of the

disputed provision, [the court] determine[s] whether

that provision is ambiguous, for, if the provision

according to its terms is unambiguous, [the court]

enforce[s] the provision according to its terms as a 

matter of law. A contractual provision is ambiguous

only if it is capable of more than one plausible and

reasonable interpretation. If the disputed provision

is ambiguous, [the court] proceed[s] to a second step

that involves examining extrinsic evidence of the

contracting parties' intent. If resort to such

extrinsic evidence does not resolve the ambiguity, then

[the court] proceed[s] to a third and final step,

namely, resort to appropriate maxims of construction.

 

McKay's Mkt. of Coos Bay, Inc. v. Pickett, 212 Or. App. 7, 12

(2007)(internal quotations and citations omitted). See also

Tipperman v. Tsiatsos, 327 Or. 539, 545-46 (1998); Yogman v.

Parrott, 325 Or. 358, 364 (1997). Because there cannot be any

waiver “by implication or by use of ambiguous language” and any

ambiguity in the existence of a waiver of Eleventh Amendment

immunity or in the scope of a waiver of Eleventh Amendment

immunity “must be construed strictly in favor of the sovereign,”

the parties agree the Court only needs to address the first step

of Oregon’s three-step contract-interpretation analysis. See

33 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 33 of 63
Nordic Village, 503 U.S. at 34. See also F.A.A. v. Cooper, 132

S. Ct. 1441, 1448 (2012). Specifically, the parties assert in an

ordinary contract case the jury resolves any ambiguity in a

contract provision. When, however, a contract provision involves

a State’s purported waiver of Eleventh Amendment immunity, the

court determines whether there is an ambiguity in the alleged

waiver provision, and, if so, the court is compelled to find

there was not a waiver. 

The parties do not dispute Oregon consented under 

§ O.1 to suit in at least state court for violations of the OHA

OLSA because the language of § O.1 clearly permits actions in

state court against Oregon under the OHA OLSA. In addition,

Oregon Revised Statute § 30.320 specifically contemplates

contract actions against Oregon in state court, and the OTCA

permits tort actions against Oregon in state court. The

unsettled question is whether § O.1 also waives Oregon’s Eleventh

Amendment immunity to suit in federal court. 

In Pettigrew the contract provision stated litigation

to enforce the terms of the contract “will be brought in the

appropriate Oklahoma court having jurisdiction, either state or

federal.” 722 F.3d at 1214 (emphasis in original). As in this

case, the defendant in Pettigrew asserted “[t]he only

‘appropriate’ Oklahoma court having jurisdiction over the state

law claims . . . would be Oklahoma's state courts” because

34 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 34 of 63
Eleventh Amendment immunity protects states from suits in federal

court. 722 F.3d at 1215. Similarly, in Baum the provision in

the parties’ contract stated the parties “hereby submit to

jurisdiction in the appropriate State or Federal Courts of Record

sitting in the State of Michigan.” 503 F.3d at 1368-69. The

defendant in Baum asserted the venue provisions could “be read

not as a waiver of immunity from suit, but merely an acceptance

of venue in Michigan, if Baum can somehow overcome the obstacle

of the University's immunity.” 503 F.3d at 1370. As noted, the

courts in both Pettigrew and Baum rejected the States’ arguments. 

For example, in Pettigrew the court noted adoption of the

defendant’s interpretation of the venue provision would cause the

word “appropriate” to void or to cancel “or federal.” The court

concluded such an interpretation would violate Oklahoma’s rules

of contract construction, which require contracts to be 

construed “‘so as to give effect to every part, if reasonably

practicable.’” 722 F.3d at 1215-16 (quoting Okla. Stat. Tit. 15,

§ 157). 

Although the specific language of § O.1 is different

from the wording in the Pettigrew and Baum contracts, the Court

concludes the effect is the same. With respect to disputes

related to the OHA OLSA, § O.1 provides DHS/OHA “agree[s] to

submit to the exclusive jurisdiction of, and venue in, if in

state Courts, in the Circuit Court of the State of Oregon for

35 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 35 of 63
Marion County or, if in federal courts, the United States

District Court for the District of Oregon.” This phrasing is

simply another way of stating “appropriate jurisdiction” as in

Pettigrew. Because the Eleventh Amendment prohibits actions

against States in federal court, the phrase “if in federal court”

must constitute a waiver or the phrase would appear to be

meaningless in the context of Oracle’s copyright-infringement

claim against Oregon. 

As noted, Oregon, nevertheless, argues there are three

circumstances in which it asserts § O.1 could have a meaning

other than a waiver of Eleventh Amendment immunity: (1) If the

Ninth Circuit holds the CRCA abrogates States’ Eleventh Amendment

immunity to copyright actions, (2) if Oregon is the plaintiff in

a federal claim, and/or (3) if Oregon voluntarily appears and

defends an action in federal court on the merits. The Court

concludes, however, that these examples actually lend credence to

Oracle’s argument that § O.1 is a waiver of Oregon’s Eleventh

Amendment immunity because even without § O.1, Oregon would

properly be in federal court if it initiated an action on a

federal claim, sought removal to federal court, or voluntarily

appeared and defended an action in federal court on the merits. 

See, e.g., Cal. ex rel. Lockyer, 375 F.3d at 845 (“[A] state that

voluntarily brings suit [on a federal claim] as a plaintiff in

state court cannot invoke the Eleventh Amendment when the

36 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 36 of 63
defendant seeks removal to a federal court of competent

jurisdiction.”); Fordyce, 55 F.3d at 441 (A State can “waive

Eleventh Amendment protection by voluntarily appearing and

defending [a suit in federal court] on the merits.”). In

addition, even though the Ninth Circuit had not decided whether

Congress validly abrogated States’ Eleventh Amendment immunity

when it enacted the CRCA, every other court that had addressed

the question at the time that the parties entered into the OHA

OLSA in 2011 concluded Congress did not so. The Court concludes

it is not reasonable to infer on this record that the parties

included the “if in federal court” language in § O.1 only for the

purpose of selecting this particular federal court to hear a

copyright-infringement claim in the event that the Ninth Circuit

concluded some time in the future that Congress validly abrogated

Oregon’s Eleventh Amendment immunity with the CRCA.

In summary, after reviewing the text of § O.1 in the

context of the OHA OLSA as a whole as well as in the context of

the parties’ negotiations, the Court concludes § O.1 is a

sufficiently clear and unambiguous waiver of Oregon’s Eleventh

Amendment immunity as to Oracle’s copyright-infringement claims

against DHS/OHA.

IV. Authority to Waive Oregon’s Eleventh Amendment Immunity 

Oregon asserts even if the Court finds § O.1 to be a

sufficiently clear waiver of Oregon’s Eleventh Amendment immunity

37 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 37 of 63
with respect to Oracle’s copyright claim against the DHS/OHA, the

Court should not enforce the waiver because Oregon Assistant

Attorney General Jack McDonald lacked the authority to waive

Oregon’s Eleventh Amendment immunity. 

As noted, a “state's waiver must be accomplished by someone

to whom that power is granted under state law.” Ford Motor Co.

v. Dep’t of Treasury, 323 U.S. 459, 467 (1945). Although it is

undisputed that the Oregon Attorney General has the power to

waive the State’s Eleventh Amendment immunity, the parties

dispute whether Assistant Attorney General McDonald had the

authority to waive Oregon’s Eleventh Amendment immunity when he

signed the OHA OLSA. The parties agree there is not any Ninth

Circuit precedent on this issue. 

Oregon relies on Magnolia Venture Capital Corp. v.

Prudential Securities, Inc., to support its assertion that

Assistant Attorney General McDonald lacked the authority to bind

DHS/OHA to § O.1. In Magnolia the Mississippi Department of

Economic and Community Development (the MDECD) entered into a

contract containing a provision that the Fifth Circuit assumed

for purposes of its analysis was sufficient to indicate that

Mississippi waived its Eleventh Amendment immunity. 151 F.3d at

442. Mississippi, however, asserted “even if the venue provision

[was] construed as waiving Eleventh Amendment immunity, MDECD had

no authority to waive Eleventh Amendment immunity,” and,

38 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 38 of 63
therefore, Mississippi could still assert Eleventh Amendment

immunity. Id. The Fifth Circuit concluded MDECD lacked the

authority to waive Mississippi’s Eleventh Amendment immunity

contractually, and, therefore, the matter should have been

dismissed by the lower court. The Fifth Circuit explained courts

must look to the “‘general policy of the state as expressed in

its Constitution, statutes and decisions’” when determining

whether a state official or entity has the authority to waive a

State’s Eleventh Amendment immunity. Id. at 444 (quoting Ford

Motor Co., 323 U.S. at 467). The authority to waive immunity

“must be clearly expressed” in these sources. Id. (citation

omitted). Although the court found Mississippi law clearly

waived the State’s sovereign immunity from suit in Mississippi

state courts, “there [was] no Mississippi law to support the

implication that MDECD had the authority to waive Mississippi's

Eleventh Amendment immunity.” Id. 

Oracle, in turn, points to Oregon Revised Statute 

§ 180.140(1), which provides: 

The Attorney General shall appoint . . .

assistants the Attorney General deems necessary to

. . . perform such duties as the Attorney General

may designate and for whose acts the Attorney

General shall be responsible. Each assistant

shall have full authority under the direction of

the Attorney General to perform any duty required

by law to be performed by the Attorney General.

Oracle asserts because the Oregon Attorney General had the legal

authority to waive Oregon’s Eleventh Amendment immunity,

39 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 39 of 63
Assistant Attorney General McDonald had the same authority under

§ 180.140(1). 

Oregon does not dispute § 180.140(1) generally vests

assistant attorneys general with the authority to perform duties

that the Attorney General may perform. Oregon, however, asserts

Assistant Attorney General McDonald was not vested with the

specific authority to waive Eleventh Amendment immunity, and,

therefore, he could not do so in the OHA OLSA. Nonetheless,

Oregon does not point to any statutory, constitutional, or

regulatory authority that bars assistant attorneys general from

waiving Eleventh Amendment immunity. Instead Oregon relies on

Oregon Department of Justice internal Policy Memo 5-80, which

provides:

The Attorney General has the authority to waive

the State of Oregon's Eleventh Amendment immunity

from suit in federal court. This authority is

inherent in the Attorney General's responsibility

to defend any action in any court and the DOJ's

authority to control and supervise the conduct of

litigation.

* * *

The Attorney General may authorize waiver of the

state's 11th Amendment immunity in cases in

federal court in which the state is a party and a

claim for money damages is asserted or prospective

relief is sought that could require a payment from

state funds. 

Decl. of John McDonald in Support of the State of Oregon's Mot.

for Summ. J., Ex. 1 at 1. The Policy Memo also sets out a

specific procedure that the Attorney General’s Office requires

40 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 40 of 63
assistant attorneys general to follow in order to obtain

permission to waive Eleventh Amendment immunity. The parties do

not dispute that Assistant Attorney General McDonald failed to

follow the internal Policy Memo procedure requiring him to obtain

permission to waive Oregon’s Eleventh Amendment immunity in the

OHA OLSA nor do the parties dispute that the Attorney General at

the time, John Kroger, did not give Assistant Attorney General

McDonald express permission to waive Oregon’s Eleventh Amendment

immunity. 

The Court agrees with Oracle’s observation that the internal

Policy Memo is not a “[c]onstitution, statute[, or] decision” of

the Oregon Legislature or Oregon courts, and, in light thereof,

the Court concludes even under Magnolia Assistant Attorney

General McDonald’s failure to follow the particular procedures

set out in the Policy Memo is insufficient to establish that he

lacked the actual authority to waive Eleventh Amendment immunity. 

In the alternative, Oracle asserts even if Assistant

Attorney General McDonald did not have the actual authority to

waive Eleventh Amendment immunity, he had apparent authority to

do so, and the parties proceeded under the terms of the OHA OLSA

accordingly. Thus, Oracle contends DHS/OHA is bound by the terms

of the OHA OLSA, including § O.1. See Wiggins v. Barrett &

Assoc., 295 Or. 679, 692-93 (1983)(a public entity can be bound

by an agent acting outside of the scope of his authority if that

41 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 41 of 63
person acted with apparent authority). The Oregon Supreme Court

has held an agent acts with apparent authority when: (1) He

makes a promise that the public entity could lawfully make and

perform, (2) the public entity “clothes” the agent with apparent

authority, (3) there is not any actual or constructive notice of

the lack of actual authority, and (4) the public entity retained

a benefit in return for the promise. Wiggins, 295 Or. at 697. 

As noted, it is undisputed that the Attorney General has the

power to waive the State’s Eleventh Amendment immunity and that

assistant attorneys general are authorized by statute to act with

“full authority under the direction of the Attorney General to

perform any duty required by law to be performed by the Attorney

General.” Or. Rev. Stat. § 180.140(1). In addition, when the

State authorized Assistant Attorney General McDonald to negotiate

the provisions of the OHA OLSA and to sign the OHA OLSA, the

Court finds Oregon “clothed” him with apparent authority to bind

Oregon to the provisions of the OHA OLSA, including § O.1. 

Moreover, it is undisputed that Assistant Attorney General

McDonald did not advise Oracle nor did Oracle have any indication

that Assistant Attorney General McDonald lacked the authority to

agree to § O.1. Thus, Oracle did not have actual or constructive

notice that Assistant Attorney General McDonald might lack the

authority to agree to § O.1. Finally, as Oracle points out,

Oregon does not dispute for purposes of this issue that it

42 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 42 of 63
received a benefit from the OHA OLSA.

Oregon, however, asserts Assistant Attorney General McDonald

could not act with apparent authority outside of the scope of his

actual authority. Because Assistant Attorney General McDonald

did not have the actual authority to permit him to waive the

State’s Eleventh Amendment immunity, Oregon contends he also did

not have the apparent authority to do so. Oregon relies on Baker

v. Deschutes County, 10 Or. App. 236 (1972), to support its

assertion. 

In Baker the court held: 

There is no apparent authority in a public officer

whose duties are prescribed by law as there would

be in the case of an agent for a private party

. . . . A contract by a public officer in excess

of the provisions of the statute authorizing such

contract is void, so far as it departs from or

exceeds the terms of the law under which it was

attempted to be negotiated.

Id. at 240 (citations omitted). The court also noted: 

It is fundamental law that government entities and

their officers must find sanction for their

actions in the statute itself. . . . Persons

contracting with a public officer acting under a

public law must, at their peril, ascertain the

scope of the officer's authority, and are

chargeable with notice of the contents of the

enactment conferring that authority.

Id. (citations omitted). As Oracle points out, however, because

the Attorney General has the authority to waive Eleventh

Amendment immunity and Oregon Revised Statute § 180.140(1)

provides assistant attorneys general with the same authority as

43 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 43 of 63
that held by the Oregon Attorney General, Assistant Attorney

General McDonald did not contract in excess of his statutory

authority. In ascertaining the scope of Assistant Attorney

General McDonald’s statutory authority, Oracle is only chargeable

with notice of the contents of Oregon’s statutes, constitution,

and/or regulations with respect to his authority. The Court,

therefore, declines to extend Baker by concluding that Oracle is

charged with notice of the contents of an internal Department of

Justice Policy Memo.

On this record, therefore, the Court concludes Assistant

Attorney General McDonald had either actual or apparent authority

to waive Oregon’s Eleventh Amendment immunity as to Oracle’s

copyright-infringement claim against DHS/OHA via § O.1. 

Accordingly, the Court denies Oregon’s Motion for Summary

Judgment and grants Oracle’s Cross-Motion for Summary Judgment.

DCBS’S MOTION (#142) FOR JUDGMENT ON THE PLEADINGS

DCBS moves for judgment on the pleadings and dismissal of

Oracle’s copyright-infringement claim against DCBS on the ground

of Eleventh Amendment immunity. 

Oracle, in turn, asserts DCBS’s Eleventh Amendment immunity

was waived when Cover Oregon entered into the Cover Oregon OLSA. 

In the alternative, Oracle asserts if DCBS’s Eleventh Amendment

immunity was not waived, § 6(3)(a) of Senate Bill 1 is

44 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 44 of 63
unconstitutional.

I. Standards

Federal Rule of Civil Procedure 12(c) provides:

After the pleadings are closed but within such

time as not to delay the trial, any party may move

for judgment on the pleadings. If, on a motion

for judgment on the pleadings, matters outside the

pleadings are presented to and not excluded by the

court, the motion shall be treated as one for

summary judgment and disposed of as provided in

Rule 56, and all parties shall be given reasonable

opportunity to present all material made pertinent

to such a motion by Rule 56.

For purposes of a motion pursuant to Rule 12(c), the court must

accept the nonmoving party's allegations as true and view all

inferences in a light most favorable to the nonmoving party. 

Fleming v. Pickard, 581 F.3d 922, 925 (9th Cir. 2009). A

judgment on the pleadings is properly granted when, taking all

allegations in the nonmoving party's pleadings as true, the

moving party is entitled to judgment as a matter of law. Compton

Unified Sch. Dist. v. Addison, 598 F.3d 1181, 1185 (9th Cir.

2010). "To survive a Rule 12(c) motion, the complaint must

contain sufficient factual matter, accepted as true, to state a

claim to relief that is plausible on its face." Davis v. Astrue,

Nos. C–06–6108 EMC, C–09–0980 EMC, 2011 WL 3651064, at *1 (N.D.

Cal. Aug. 18, 2011)(citation omitted). See also Cafasso v. Gen.

Dynamics C4 Sys., Inc., 637 F.3d 1047, 1055 n.4 (9th Cir. 2011)(A

Rule 12(c) motion is “functionally identical to a Rule 12(b)(6)

motion to dismiss for failure to state a claim, and therefore the

45 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 45 of 63
same legal standard applies."). 

II. DCBS is entitled to assert Eleventh Amendment immunity

unless its immunity was waived.

DCBS is an arm of the State, and, as such, Eleventh

Amendment immunity would usually bar an action for copyright

infringement against DCBS in this Court. In addition, although

the Ninth Circuit has not addressed the issue, other courts have

held when a state entity that enjoys Eleventh Amendment immunity

is a successor in interest to a non-state entity that did not

enjoy Eleventh Amendment immunity, the state entity is still

entitled to Eleventh Amendment immunity absent explicit

abrogation or waiver of that immunity. For example, in MaysonetRobles v. Cabrero, 323 F.3d 43 (1st Cir. 2003), the plaintiffs

brought an action against the trustee for the Urban Renewal

Housing Corporation Accounts Liquidation Office of Puerto Rico

(the Office), which was not an arm of the State and did not enjoy

Eleventh Amendment immunity. More than one year into the

litigation the Legislature of the Commonwealth of Puerto Rico

dissolved the Office and transferred its functions to the

Department of Housing of the Commonwealth of Puerto Rico (the

Department), which, as an agency of the State, enjoyed Eleventh

Amendment immunity. The Department was substituted for the

Office and filed a motion to dismiss on the ground of Eleventh

Amendment immunity. The district court concluded the Department

was entitled to Eleventh Amendment immunity even though it was

46 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 46 of 63
“injected into the pending litigation as a successor to a party

that had not been entitled to immunity under the Eleventh

Amendment,” and the court granted the Department’s motion to

dismiss. Id. at 49. The plaintiffs appealed and argued the

Department should not be permitted to assert immunity “because it

entered the case midstream as a successor to the Office, an

entity that was itself outside the scope of that immunity.” Id.

at 49. The plaintiffs asserted because federal jurisdiction “was

properly established over the Office when the suit was initiated,

it is not subject to ouster by subsequent events.” Id. The

First Circuit rejected the plaintiffs’ argument:

[W]hile the Eleventh Amendment has been described

as a jurisdictional bar with a “hybrid nature,”

similar in some respects to personal jurisdiction

and to subject matter jurisdiction in others, it

is on all fours with neither (see Wis. Dep't of

Corrs. v. Schacht, 524 U.S. 381, 394 (1998)

(Kennedy, J., concurring)). Rather it is “a

specific text with a history that focuses on the

State's sovereignty vis-a-vis the Federal

Government.” (Lapides, 122 S. Ct. at 1646). 

Unlike a private individual or corporation, a

State retains its . . . immunity as a “personal

privilege” and, whether it is the original

defendant or is added as a party later, it cannot

be sued involuntarily.

* * *

[The] Department is an arm of the State,

regardless of its late arrival at the courthouse

as a successor in interest, and it must be

accorded the same respect due a State under the

Eleventh Amendment (see Kroll v. Bd. of Trustees

of the Univ. of Ill., 934 F.2d 904, 909 (7th Cir.

1991); Williamson Towing Co. v. Illinois, 534 F.2d

758, 760–61 (7th Cir. 1976)). To prevail here,

47 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 47 of 63
then, Plaintiffs must establish that Puerto Rico

waived its own immunity in light of those legal

principles by dissolving the Office into

Department.

Id. at 50. The First Circuit concluded the State did not waive

Eleventh Amendment immunity when the legislature created the

Department:

To be sure, Act 106 does provide that lawsuits

pending against the Office at the time of

enactment are to be taken over by Department. To

that end [the] Act's Article 4 mandates the

transfer to Department of the Office's “records,

assets, and liabilities” and provides that

“Department shall not be responsible for any claim

beyond those passed on by the Office.” Article 5

requires that an inventory of pending lawsuits be

delivered to Department. Lastly, Article 7 orders

the Department of Justice to support Department as

requested in such lawsuits and reads in part:

The Department of Housing shall have the same

rights and powers, except for the capacity to

sue and be sued, and may raise the same

defenses used by the Office in case of any

litigation or claim related to the

transferred assets.

But none of that language about pending lawsuits

conveys Puerto Rico's unequivocal consent for such

pending litigation to continue in federal court.

Id. at 51. The court acknowledged:

[I]t does not require a particularly jaundiced eye

to deduce from the Act's text that the Puerto Rico

legislature acted to dissolve the Office and

transfer the claims to Department with the precise

goal of raising the shield of immunity. Such

jurisdictional game-playing would be beyond the

pale for any private litigant, and it is not a new

strategy for the Commonwealth. . . . But it has

been nearly a century and a half since Beers, 61

U.S. at 529 held that because the waiver of such

immunity is entirely within the sovereign's

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Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 48 of 63
prerogative, a State may alter the conditions of

waiver and apply those changes to torpedo even

pending litigation.

Id. at 51-52 (citations omitted). Accordingly, the First Circuit

concluded the State had not waived the Department’s Eleventh

Amendment immunity via the statute. The court also concluded the

State did not waive the Department’s immunity through conduct

during the litigation:

Neither the Office nor Department has taken any

action in this lawsuit that may be fairly

described as voluntarily submitting the

Commonwealth's rights for adjudication by the

federal court. As for the Office, it has yet to

answer Plaintiffs' complaint, let alone take steps

akin to filing a counterclaim or third-party

complaint. Nor is the automatic substitution of

Department for the Office — unlike an election to

remove a case from a state court to a federal

court — a clear invocation of federal court

jurisdiction. Although the Office's motions urged

that either Department or Puerto Rico was the real

party in interest, that was coincident with their

raising the shield of immunity. And Department's

entry into the case as the Office's successor,

which was employed only to advance that same

immunity contention, also cannot be labeled as a

voluntary submission. In short, anything that

might be characterized as affirmative litigation

conduct goes back to the statute itself. And

while the Commonwealth's Act 106 chose to

interject Department into all pending litigation

against the Office, it has already been said that

the statutory language does not unequivocally

consent to the continuation of any such suits in

federal court.

Id. at 52-53.

Similarly, in Surprenant v. Mass. Turnpike Auth., 768 F.

Supp. 2d 312 (D. Mass. 2011), the plaintiff brought an action

49 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 49 of 63
against the Massachusetts Turnpike Authority (MTA), which was not

a state agency entitled to Eleventh Amendment immunity. Nine

months after the plaintiff filed her action, the Massachusetts

Legislature created a new state agency (MassDOT) and transferred

the “functions, assets, and liabilities” of the MTA to MassDOT. 

The legislation transferring the MTA’s functions, assets, and

liabilities did not explicitly address Eleventh Amendment

immunity for MassDOT. The plaintiff filed an Amended Complaint

substituting MassDOT as the named defendant. MassDOT filed an

answer, raised the Eleventh Amendment as an affirmative defense,

and then filed a motion for judgment on the pleadings on the

ground of Eleventh Amendment immunity. 768 F. Supp. 2d at 314. 

The plaintiff objected to the “post hoc absolution of the MTA, as

the predecessor of the MassDOT, from liability for its past

actions on grounds of . . . immunity.” Id. at 317. The court

concluded MassDOT was entitled to Eleventh Amendment immunity

and, therefore, granted MassDOT’s motion for judgment on the

pleadings. The court reasoned the statute did not indicate the

legislature waived MassDOT’s Eleventh Amendment immunity:

[T]here is nothing in the statute or its wording

that would prevent or bind the MassDOT from

asserting any of its available defenses, even

those that have the effect of terminating a

lawsuit on jurisdictional grounds. . . . See

Maysonet–Robles, 323 F.3d at 50–51 (finding a

similar grant of continuing authority over pending

litigation to stop well short of an unequivocal

consent to a waiver of sovereign immunity). Any

hesitation must be strictly resolved in favor of

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Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 50 of 63
the Commonwealth as a waiver of . . . immunity

will not be implied. Lane v. Pena, 518 U.S. 187,

192 (1996). 

It may seem unfair that an immunity defense that

was not available to the MTA can be bestowed on

the MassDOT as its successor by legislative fiat. 

But . . . the Eleventh Amendment enjoys a unique

jurisdictional status. “Unlike a private

individual or corporation, a State retains its 

. . . immunity as a personal privilege and,

whether it is the original defendant or is added

as a party later, it cannot be sued

involuntarily.” Maysonet–Robles, 323 F.3d at 50.

Id. at 318 (quotation omitted).

In Kroll v. Board of Trustees of University of Illinois, 934

F.2d 904 (7th Cir. 1991), the plaintiff brought an action against

the University of Illinois Athletic Association, a non-state

entity that was not entitled to Eleventh Amendment immunity. The

plaintiff’s complaint was dismissed with leave to amend. When

the plaintiff filed an amended complaint, he again named the

Athletic Association. Between the time of the dismissal of the

plaintiff’s complaint and the time that the plaintiff filed his

amended complaint, however, the Illinois Legislature passed

legislation merging the Athletic Association with the Board of

Trustees of the University of Illinois (the Board), a state

entity. The Board then appeared in the matter and asserted

Eleventh Amendment immunity. 934 F.2d at 906. The district

court “rejected this argument,” and the Board appealed. On

appeal the plaintiff asserted “the Board, as successor to the

Athletic Association, cannot invoke the eleventh amendment [sic]

51 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 51 of 63
because that defense was unavailable to the Athletic

Association.” Id. at 909. The Seventh Circuit rejected that

argument: “[T]he Board, regardless of its status as a successor

entity, and in the absence of waiver or congressional abrogation

must be accorded the respect due a State under the eleventh

amendment [sic].” Id. The court, therefore, concluded the

Illinois Legislature had not abrogated the Board’s Eleventh

Amendment immunity and that the Board’s immunity had not been

waived. The court noted it could give effect to a waiver “‘only

[when] stated by the most express language or by such

overwhelming implication from the text as [will] leave no room

for any other reasonable construction.’” Id. (quoting Port

Authority, 495 U.S. at 305, and noted:

[T]he only plausible basis for that type of waiver

is a provision of the special legislation that

allowed the Board to merge with the Athletic

Association. In its entirety, that provision

states:

The Board of Trustees of the University of

Illinois shall be responsible and liable for

all the liabilities and obligations of each

of the corporations so merged; and any claim

existing or action or proceeding pending by

or against either of such corporations may be

prosecuted to judgment as if such merger had

not taken place, or the surviving corporation

may be substituted in its place. Neither the

rights of creditors nor any liens upon the

property of either of such corporations shall

be impaired by such merger.

Ill. Rev. Stat. ch. 144, para. 28d(d)(4).

The district court correctly identified a waiver

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Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 52 of 63
in that statutory language, but as we view it that

waiver is not effective in this eleventh amendment

context.

* * *

At best, the evidence of waiver is ambiguous; the

language might consent to suit in federal court,

but then again it might not. And under these

circumstances, federal courts are loath to find a

waiver; the “vital role of the doctrine of

sovereign immunity in the federal system” demands

that we err, if at all, on the side of immunity. 

See Pennhurst II, 465 U.S. at 99. For purposes of

the eleventh amendment, therefore, an ambiguous

waiver is no waiver at all.

Id. at 910-11.

The Court notes § 6(3), Senate Bill 1, specifically provides

the Bill does not waive DCBS’s immunity. In any event, the Court

finds the reasoning of Maysonet, Suprenant, and Kroll to be

persuasive and concludes pursuant to that reasoning that Senate

Bill 1 does not explicitly abrogate DCBS’s Eleventh Amendment

immunity. Accordingly, unless Oracle can establish that DCBS

waived its Eleventh Amendment immunity via § O.1 of the Cover

Oregon OLSA, the Court must conclude DCBS is entitled to Eleventh

Amendment immunity and grant DCBS’s Motion for Judgment on the

Pleadings.

III. Waiver of Eleventh Amendment Immunity

Oracle asserts the transfer of Cover Oregon’s “rights,

obligations and liabilities” to DCBS in Senate Bill 1 together

with Cover Oregon’s agreement to federal jurisdiction in the

Cover Oregon OLSA serves as a waiver of DCBS’s Eleventh Amendment

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Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 53 of 63
immunity because under Senate Bill 1 DCBS assumed all of Cover

Oregon’s obligations under the Cover Oregon OLSA which would

include the agreement in § O.1 to be sued in federal court.

A. The transfer of Cover Oregon’s rights, obligations, and

liabilities in Senate Bill 1 did not transfer Cover

Oregon’s lack of Eleventh Amendment immunity. 

Oracle concedes the Supreme Court held in Beers v.

Arkansas that a State is entitled to limit legislatively the

scope of a previous statutory waiver of immunity even when a

claim against the State is pending. 61 U.S. 527, 529 (1857). 

Oracle notes, however, that the Supreme Court, in reaching its

conclusion, also found “the State violated no contract with the

parties” when enacting the legislation at issue in that case. 

Id. at 530. Here Oracle asserts § O.1 of the Cover Oregon OLSA,

in contrast to the circumstances in Beers, would be violated if

DCBS was permitted to assert Eleventh Amendment immunity. As

noted, § O.1 of the Cover Oregon OSLA provides: 

This agreement is governed by the substantive and

procedural laws of Oregon and [Cover Oregon] and

Oracle agree to submit to the exclusive

jurisdiction of, and venue in, if in state Courts,

in the Circuit Court of the State of Oregon for

Marion County or, if in federal courts, the United

States District Court for the District of Oregon,

in any dispute arising out of or relating to this

agreement.

Second Am. Compl., Ex. B at ¶ O.1. Oracle asserts “DCBS’s

assumption of the Cover Oregon OLSA and immediate assertion of

Eleventh Amendment immunity with respect to claims arising under

54 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 54 of 63
that contract will violate its terms.” Specifically, Oracle

contends because DCBS assumed all of Cover Oregon’s rights,

liabilities, and obligations under the Cover Oregon OLSA pursuant

to Senate Bill 1, DCBS also assumed Cover Oregon’s agreement in 

§ O.1 to be sued in federal court. At least one court, however,

has rejected this argument. In Asociacion de Empleados del Area

Canalera (ASEDAC) v. Panama Canal Commission the plaintiff

asserted when “the liabilities of a defunct government entity

whose immunity had been waived are transferred to an entity whose

immunity is retained[,] . . . the waiver of immunity is also 

transferred to the successor entity.” 453 F.3d 1309, 1315 (11th

Cir. 2006). The ASEDAC court rejected that argument and “the

notion that the transfer of the [defunct government entity’s]

liabilities to the [entity that retained immunity] automatically

carried with it [the defunct government entity’s] waiver of

immunity, absent unequivocal statutory language to that effect.” 

Id. 

The Court finds the reasoning of ASEDAC to be

persuasive and adopts that reasoning as well as the reasoning of

Maysonet, Suprenant, and Kroll. Thus, because Cover Oregon

lacked Eleventh Amendment immunity when it entered into the Cover

Oregon OLSA and Senate Bill 1 does not contain any statutory

language that explicitly transferred Cover Oregon’s lack of

Eleventh Amendment immunity to DCBS, the Court declines to

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Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 55 of 63
conclude Cover Oregon’s consent to suit in federal court under 

§ O.1 of the Cover Oregon OLSA together with Senate Bill 1 waived

DCBS’s Eleventh Amendment immunity. 

B. Waiver of an Immunity that Cover Oregon Did Not Possess

DCBS also asserts Cover Oregon could not waive DCBS’s

Eleventh Amendment immunity in § O.1 of the Cover Oregon OLSA

because Cover Oregon was never entitled to Eleventh Amendment

immunity, and it is contrary to law to conclude that an entity

can waive what it never had. 

Under Oregon law “a waiver is the ‘intentional

relinquishment of a known right.’” Wood Park Terrace Apartments

Ltd. P’ship v. Tri-Vest, LLC, 254 Or. App. 690, 695 (2013)

(quoting Guardian Mgmt. LLC v. Zamiello, 194 Or. App. 524, 529

(2004)). It is axiomatic, therefore, that one may not waive a

right that one does not possess. See, e.g., Kristensen ex rel.

Kristensen v. Spotnitz, No. 3:09–CV–00084, 2011 WL 4458974, at *5

(D. Va. Sept. 26, 2011)(“[O]ne cannot waive a right that one does

not possess.”); Dominion Retail, Inc. v. Rogers, No. 2:11–CV–

00233, 2013 WL 1149911, at *4 (W.D. Pa. Jan. 30, 2013)(same);

Brookwood, LLC v. Scottsdale Ins. Co., No. 08–4793, 2009 WL

2525756, at *4 (E.D. La. Aug. 17, 2009)(doctrine of waiver

applies only to an existing legal right); Shaw Constructors v.

ICF Kaiser Eng'rs, Inc., 395 F.3d 533, 547 n.55 (5th Cir. 2004)

(“[I]t is essential to waiver that the right allegedly waived

56 - OPINION AND ORDER

Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 56 of 63
exist at the time of the waiver; a party may not waive any right

it does not yet have.” (quotation omitted)). 

As noted, Cover Oregon did not have any right to

Eleventh Amendment immunity. According to DCBS, therefore, when

Cover Oregon agreed to federal jurisdiction in § O.1, it could

not have been waiving any right of DCBS to Eleventh Amendment

immunity. The Court agrees. 

In summary, because a party may not waive a right it

does not possess, the Court concludes it would be unreasonable to

find Cover Oregon waived Eleventh Amendment immunity on its own

behalf or on behalf of DCBS when it entered into the Cover Oregon

OLSA. In addition, the Court concludes the Oregon Legislature

did not effectively waive DCBS’s Eleventh Amendment immunity in

Senate Bill 1 because it did not explicitly state it was doing so

when it transferred Cover Oregon’s obligations to DCBS. Like the

court in Maysonet-Robles, this Court is mindful of the possibly

disruptive precedent for future contracts between Oregon and

others arising from the Oregon Legislature’s transfer of Cover

Oregon’s rights and obligations to a state agency entitled to

Eleventh Amendment immunity. The Court, nevertheless, does not

find any legal basis to conclude that DCBS’s immunity was

abrogated by Senate Bill 1 or waived in § O.1 of the Cover Oregon

OLSA.

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Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 57 of 63
C. Meeting of the Minds 

Finally, DCBS asserts there was not a meeting of the

minds at the time the parties entered into the Cover Oregon OLSA

that § O.1 would constitute a waiver of immunity if at some point

Cover Oregon was dissolved and its duties and obligations were

taken over by a state entity.

Under Oregon law “[w]hen . . . interpret[ing] any

written instrument, [the court's] objective is to ascertain the

meaning that most likely was intended by the parties that entered

into it.” McKay's Mkt. of Coos Bay, Inc. v. Pickett, 212 Or.

App. 7, 12 (2007)(internal quotations and citations omitted). 

See also Tipperman v. Tsiatsos, 327 Or. 539, 545-46 (1998). In

particular, the Court must look at the intent of the parties as

to the meaning of a term when the parties entered into the

contract or agreement. See, e.g., Prtizker v. Carr, 113 Or. App.

310, 213 (1992); Fitzgibbon v. Carey, 70 Or. App. 127, 132

(1984).

The record does not reflect Cover Oregon believed when

the parties entered into the Cover Oregon OLSA that it might have

Eleventh Amendment immunity in the future or that it intended to

waive Eleventh Amendment immunity for itself or others. A more

reasonable interpretation of § O.1 at the time of the formation

of the Cover Oregon OLSA is that the parties agreed any dispute

arising under the Cover Oregon OLSA would be heard in Marion

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Case 3:14-cv-01279-BR Document 156 Filed 11/18/15 Page 58 of 63
County Circuit Court if state-court jurisdiction was appropriate

or heard in this Court if federal jurisdiction was appropriate.

The Court recognizes the language in § O.1 of the Cover

Oregon OLSA is the same as the language in § O.1 of the OHA OLSA. 

Nevertheless, the circumstances and timing of the formation of

the two contracts, the nature of the parties entering into the

two contracts at the time of formation, and the intent of the

parties at that time were manifestly different. The Court,

therefore, concludes the identical language has different

meanings in the different contexts of the different agreements.

When Oregon entered into the OHA OLSA, it was well aware that it

was entitled to Eleventh Amendment immunity, and, therefore, as

explained above, it is not unreasonable for the Court to conclude

that Oregon was waiving its Eleventh Amendment immunity in § O.1

when it entered into the OHA OLSA. In contrast, when Cover

Oregon entered into the Cover Oregon OLSA, it did not have

Eleventh Amendment immunity, and, therefore, the most reasonable

interpretation of § O.1 is that Cover Oregon agreed only to place

venue in this Court if a federal claim arose under that

agreement.

Finally, the Court concludes the Oregon Legislature did

not abrogate Eleventh Amendment immunity for DCBS when it

transferred Cover Oregon’s rights and obligations to DCBS

(including the provisions of the Cover Oregon OLSA in Senate 

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Bill 1) because in doing so the Oregon Legislature did not

explicitly abrogate DCBS’s Eleventh Amendment immunity.

IV. Constitutionality of § 6(3)(a), Senate Bill 1

Oracle also asserts § 6(3)(a) of Senate Bill 18 is

unconstitutional. As noted, § 6(3)(a) provides:

Notwithstanding sections 1 to 5 of this 2015 Act,

the rights, obligations and liabilities

transferred to the department:

(a) Are subject to the limitations, defenses

and immunities of the department that arise under

ORS 30.260 to 30.300, the Eleventh Amendment to

the United States Constitution and other state and

federal laws.

In particular, Oracle asserts this provision of Senate Bill 1 is

unconstitutional under (1) the Impairment of Contracts Clause,

(2) the Due Process Clause, and (3) the Takings Clause of the

United States Constitution. The Court, however, concludes its

adjudication of the constitutionality of § 6(a)(3) is avoidable,

and, therefore, the Court declines to address that issue. See

Knox v. Svc. Emp. Intern. Union, Local 1000, 132 S. Ct. 2277,

2298 (2012) (concurring opin.)(“‘If there is one doctrine more

deeply rooted than any other in the process of constitutional

adjudication, it is that we ought not to pass on questions of

constitutionality . . . unless such adjudication is

8 In its Response to DCBS’s Motion for Judgment on the

Pleadings Oracle specifically states it does not challenge the

constitutionality of any provision of Senate Bill 1 other than 

§ 6(3)(a). 

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unavoidable.’” (quoting Clinton v. Jones, 520 U.S. 681, 690, n.11

(1997)). 

Although § 6(3)(a) explicitly provides the Oregon

Legislature did not intend to waive Eleventh Amendment immunity

for DCBS when it was substituted for Cover Oregon, pursuant to

Maysonet-Robles, Kroll, and Surprenant that explicit statement

was unnecessary. DCBS would have retained Eleventh Amendment

immunity without that explicit statement because that immunity is

inherent in the Eleventh Amendment and the Legislature did not

expressly abrogate it. In Maysonet-Robles, Kroll, and Surprenant

the legislatures did not include in the legislation any

statements regarding nonwaiver of the substituted state entities’

Eleventh Amendment immunity when they substituted the state

entities with Eleventh Amendment immunity for the non-state

entities who lacked Eleventh Amendment immunity. Each of those

courts, therefore, addressed whether the legislation at issue

could be construed as a waiver of the state entities’ Eleventh

Amendment immunity, and, as noted, each of those courts reached

the same conclusion: The legislation did not sufficiently

indicate an intent to abrogate the substituted state entities’

Eleventh Amendment immunity. Thus, each of those courts

concluded the substituted state entities could assert Eleventh

Amendment immunity.

Accordingly, even ignoring the Oregon Legislature’s

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statement in § 6(3)(a) as to Eleventh Amendment immunity, DCBS

can, nevertheless, assert Eleventh Amendment immunity because

that immunity is inherent; i.e., DCBS’s Eleventh Amendment

immunity was not accorded by the Oregon Legislature in § 6(3)(a)

but rather by the Eleventh Amendment itself. Thus, even if the

Court were to conclude that § 6(a)(3) of Senate Bill 1 was

unconstitutional, such a finding would not negate DCBS’s Eleventh

Amendment immunity. Pursuant to the Supreme Court’s admonition

not to address constitutionality when such an issue is avoidable,

the Court, therefore, does not address the constitutionality of 

§ 6(a)(3) of Senate Bill 1.

In summary, the Court concludes DCBS is entitled to Eleventh

Amendment immunity as to Oracle’s claim for copyright

infringement. Accordingly, the Court grants DCBS’s Motion for

Judgment on the Pleadings. 

CONCLUSION

For these reasons, the Court DENIES Oregon’s Motion (#92)

for Summary Judgment, GRANTS Oracle’s Cross-Motion (#104) for

Summary Judgment, and GRANTS the Motion (#142) of DCBS for

Judgment on the Pleadings.

The Court DIRECTS the parties to confer and to submit no

later than Noon, December 7, 2015, a Joint Status Report with the

parties’ respective proposals and schedule for case management

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including their previously referenced intent to seek an interim

appeal.

IT IS SO ORDERED.

DATED this 18th day of November, 2015.

/s/ Anna J. Brown

 

ANNA J. BROWN

United States District Judge

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