Opinion ID: 786958
Heading Depth: 1
Heading Rank: 4

Heading: joinder of university system

Text: 85 Disabled Rights contends that the district court erred in finding that University System is a party that should have been joined in this proceeding. We agree. 86 Rule 19 of the Federal Rules of Civil Procedure sets forth considerations to guide a district court's determination whether a particular party should be joined in a suit if possible, referred to as a necessary party, see Dawavendewa, 276 F.3d at 1154-55, and, if so, whether, if the party cannot be joined, the suit should be dismissed because the absent party is indispensable. Rule 19(a) provides that a person shall if possible be joined as a party in the action if: 87 (1) in the person's absence complete relief cannot be accorded among those already parties, or (2) the person claims an interest relating to the subject of the action and is so situated that the disposition of the action in the person's absence may (i) as a practical matter impair or impede the person's ability to protect that interest or (ii) leave any of the persons already parties subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations by reason of the claimed interest. 88 FED. R. CIV. P. 19(a). Rule 19(b) provides that if a person meeting the elements of Rule 19(a) cannot be joined, 89 the court shall determine whether in equity and good conscience the action should proceed among the parties before it, or should be dismissed, the absent person being thus regarded as indispensable. The factors to be considered by the court include: first, to what extent a judgment rendered in the person's absence might be prejudicial to the person or those already parties; second, the extent to which, by protective provisions in the judgment, by shaping of relief, or other measures, the prejudice can be lessened or avoided; third, whether a judgment rendered in the person's absence will be adequate; fourth, whether the plaintiff will have an adequate remedy if the action is dismissed for nonjoinder. 90 FED. R. CIV. P. 19(b). 91 A district court's joinder decision is generally reviewed under an abuse of discretion standard. See United States v. Bowen, 172 F.3d 682, 688 (9th Cir.1999); Kescoli v. Babbitt, 101 F.3d 1304, 1309 (9th Cir.1996). However, as is usual, legal conclusions that underlie the district court's decision are reviewed de novo. See Bowen, 172 F.3d at 688; see also Dawavendewa, 276 F.3d at 1154. 92 We now turn to the discrete analysis required by Rule 19.
93 Under Rule 19(a), a party may be necessary in either of two ways. See Dawavendewa, 276 F.3d at 1155. Under Rule 19(a)(1), a party is deemed necessary if complete relief cannot be granted in its absence. This factor is concerned with consummate rather than partial or hollow relief as to those already parties, and with precluding multiple lawsuits on the same cause of action. Northrop Corp. v. McDonnell Douglas Corp., 705 F.2d 1030, 1043 (9th Cir.1983). In conducting the Rule 19(a)(1) analysis, the court asks whether the absence of the party would preclude the district court from fashioning meaningful relief as between the parties. See id. 94 In its original complaint, Disabled Rights sought a permanent injunction enjoining Events and Cowboys from engaging in discrimination on the basis of disability in violation of Title III and requiring them to cease operating the Center during the Rodeo unless and until they can do so in full compliance with the ADA. The complaint sought to enjoin only the private defendants' actions. In reaching its decision, the district court entirely failed to consider whether remedies not requiring University System's cooperation would provide meaningful relief. 95 It is apparent to us that such remedies are available. First, it is important to consider that the maximum relief available with respect to the removal of architectural or communications barriers under Title III is limited to those steps that are readily achievable by the covered entity. See 42 U.S.C. §§ 12182(b)(2)(A)(iv) & (v), 12181(9). 15 The economic situation of a public accommodation [operator] is taken into account in assessing whether the removal of architectural barriers or the provision of auxiliary aids is `readily achievable.' Botosan, 216 F.3d at 834 n. 2 (citing 42 U.S.C. § 12181(9)). Also relevant is the administrative or fiscal relationship of the facility or facilities in question to the covered entity. 42 U.S.C. § 12181(9)(D). Accordingly, the private defendants' Title III obligation would be determined with respect to the short term nature of its relationship with the Center, among other considerations, and complete relief under the statute may not necessarily mean the achievement of a fully accessible stadium. 96 Meaningful relief could thus be granted by enjoining Events and Cowboys from making certain kinds of operational decisions regarding conditions over which they have control — e.g., enjoining them from removing accessible floor seating, or requiring the erection of temporary ramps or lifts. Meaningful relief could also be granted by requiring Events and Cowboys to hold the Rodeo at an accessible venue either immediately, or in the future, after the current provisions of its licensing agreement expire. These forms of relief, which are neither hollow nor meaningless, would be available with or without University System's participation. See Ass'n to Protect Hammersley, Eld, & Totten Inlets v. Taylor Res., Inc., 299 F.3d 1007, 1014-15 (9th Cir.2002) (concluding that complete relief was possible where relief was available regardless of the absent party's participation). 97 Dawavendewa does not mandate a contrary conclusion. In Dawavendewa, the plaintiff sought to invalidate a hiring preference that was required as a term of the employer's lease with the absent party, the Navajo Nation. See 276 F.3d at 1155. The court explained that without the participation of the Navajo Nation, Dawavendewa would be unable to obtain his requested relief — employment by the defendant — because even if an injunction issued against the employer, the Navajo Nation could move to enforce its rights under the lease and ultimately evict the employer from the reservation. See id. In that event, Dawavendewa would continue to be unable to obtain the employment he sought. See id. 98 Here, however, the licensing agreement with University System, unlike the lease in Dawavendewa, does not prevent Events from taking action to make the Rodeo accessible to the degree possible within the scope of its lease or, in the alternative, from holding the Rodeo at an accessible venue. In the latter event, were University System to attempt to enforce the licensing agreement against Events, Events would be required to pay liquidated damages, not to hold the Rodeo at the Center despite its inaccessibility. Disabled Rights would still be able to obtain its objective of having the Rodeo presented at an accessible location. 99 Accordingly, we conclude that the district court abused its discretion in concluding that absent University System, no meaningful relief is possible, so that University System is a necessary party under Rule 19(a)(1). 100
101 Rule 19(a)(2) focuses on whether the absent party's participation is necessary to protect its legally cognizable interests or to protect other parties from a substantial risk of incurring multiple or inconsistent obligations because of those interests. See FED. R. CIV. P. 19(a)(2)(i) & (ii). 102
103 Events and University System maintain that University System is a necessary party in this action for injunctive relief under Rule 19(a) simply because it is a signatory to a contract with Events running through 2009. 104 For this proposition, the defendants rely on Lomayaktewa v. Hathaway, 520 F.2d 1324 (9th Cir.1975), and its progeny. Lomayaktewa pronounced that [n]o procedural principle is more deeply imbedded in the common law than that, in an action to set aside a lease or a contract, all parties who may be affected by the determination of the action are indispensable. Id. at 1325. Dawavendewa reaffirm[ed] the fundamental principle [that] a party to a contract is necessary, and if not susceptible to joinder, indispensable to litigation seeking to decimate that contract. Dawavendewa, 276 F.3d at 1157; see also Clinton v. Babbitt, 180 F.3d 1081, 1088 (9th Cir.1999) ([A] district court cannot adjudicate an attack on the terms of a negotiated agreement without jurisdiction over the parties to that agreement.). 105 In none of these formulations is that principle here applicable. We note, first, that contrary to Events' representation, Events is not bound by the licensing agreement through the year 2009. Rather, the licensing agreement explicitly provides that [t]he term of this agreement is three (3) years with three (3), two-year options, beginning in 2001. By the terms of the agreement, after 2003 Events may choose to exercise its option to hold the Rodeo at the Center. The record does not indicate whether Events has exercised its option beyond 2003. As a result, the record does not establish that University System has any legal interest as a party to a binding contract beyond 2003. 106 Second and even more important, even if there is a contract binding into the future, the Lomayaktewa rule does not resolve this case. Disabled Rights' suit is not an action to set aside ... a contract, Dawavendewa, 276 F.3d at 1156 (quoting Lomayaktewa, 520 F.2d at 1325), an attack on the terms of a negotiated agreement, Clinton, 180 F.3d at 1088, or litigation seeking to decimate [a] contract. Dawavendewa, 276 F.3d at 1157. Rather, Disabled Rights seeks Events' and Cowboys' compliance with Title III of the ADA. No term of the contract requires discrimination on the basis of disability or precludes Events and Cowboys from accommodating disabled individuals to the extent Title III requires them to do so. Thus, if Disabled Rights is successful, the contract would not be invalidated or set aside, but would remain legally binding. 107 It is possible, of course, that if Events and Cowboys are ordered to comply with Title III, they may decide to hold the Rodeo elsewhere. If Events and Cowboys do so choose, then University System might have an action against Events for breach of contract for any damage suffered as a result of the private entities' refusal to abide by their agreement. University System would be free, for example, to enforce the licensing agreement, which contains a cancellation clause giving Events the right to cancel the Rodeo at the Center by paying a specified amount of liquidated damages. But the judgment itself would not mandate any change in the agreement, or any breach. Instead, like many other external events — a drop in the financial fortunes of the group sponsoring the event, or an increase in its insurance premiums due to safety concerns — the judgment could precipitate one party to refuse to perform, in which case the other party would have its legal remedies. 108 The facts of Dawavendewa illuminate the determinative distinction between a case in which the judgment will necessarily set aside the contract and a case such as this one, where it will not. As discussed above, in Dawavendewa, a lease agreement between the Navajo Nation and a lessee of Navajo property mandated compliance with a hiring policy giving preference to Navajos. The question in the case was whether that policy violated Title VII. See Dawavendewa, 276 F.3d at 1157. The plaintiff's challenge to the lessee's preferential hiring policy necessarily alleged that the contract itself was illegal. 109 In contrast, Disabled Rights does not allege that the licensing agreement is illegal, on its face or otherwise, and indeed, could not so allege, as nothing in the agreement addresses access by or discrimination against disabled individuals. 16 Moreover, in Dawavendewa, the Navajo Nation had specifically bargained for the hiring preference as the primary consideration for the lease, so the invalidation of that provision would essentially decimate the Nation's bargained-for rights. See id. Here, there is no allegation that University System had as an objective in negotiating the contract, let alone a primary objective, preservation of a physically inaccessible venue. Disabled Rights' suit thus does not threaten to destroy the contract nor University System's bargained-for rights. Rather, as explained above, University System bargained for a liquidated damages clause, so its contractual rights would remain fully protected in the event of a judgment in Disabled Rights' favor resulting in cancellation of the agreement. Nor is it a foregone conclusion that a judgment in Disabled Rights' favor would result in such cancellation. 110 Accordingly, we reject the contention that University System must be deemed necessary merely by virtue of its status as a party to a licensing agreement with Events.
111 Events further contends that University System's legally cognizable interests are implicated because a judgment in Disabled Rights' favor would amount to a declaration that University System is operating a facility in violation of the ADA. Yet, the pertinent legal question is not whether the Center's operation by University System violates Title II, but rather whether the Center's operation by Events and Cowboys violates Title III. As Events, Cowboys, and University System acknowledge, Title III imposes obligations distinct from those imposed by Title II, and more onerous ones. So, a judgment in Disabled Rights' favor would not determine that University System's operation of the Center violates the ADA. See Title II Technical Assistance Manual, at III-1.7000 (explaining that a public entity acting as a landlord to a public accommodation is subject to title II, and that [a]s a public entity, it cannot be subject to title III, even though its tenants are public accommodations that are covered by title III); see also Johnson v. City of Saline, 151 F.3d 564, 571-72 (6th Cir.1998) (Even though the [private] businesses may be subject to Title III of the ADA . . ., the city is simultaneously subject to Title II because it is a landlord.). 112 In this respect, this case is markedly different from one involving exclusively private entities, all of whom are covered by Title III. In Botosan, a case involving a private landlord and private tenant both covered by Title III, we suggested in passing that the landlord is a necessary party in an ADA action, regardless of what the lease provides. 216 F.3d at 834. In that case, which did not involve any question of joinder under Rule 19, we held that both landlord and tenant may be held liable for violations of the ADA regardless of the allocation of responsibility provided for in the lease. See id. Citing 28 C.F.R. § 36.201(b), we explained that both the private landlord and tenant are subject to the requirements of Title III, and any allocation of that responsibility in the lease is effective only `[a]s between the parties.' Id. at 833. In this case, as explained above, University System is solely responsible, under the ADA, for ensuring that the Center complies with Title II, while the private defendants are solely responsible, under the ADA, for ensuring that the venue at which they hold the Rodeo complies with Title III. As their respective statutory obligations are not identical, University System is not a necessary party to an adjudication of the extent of the private defendants' compliance with Title III. 113 Events also suggests that an injunction enjoining private parties from using the Center would interfere with University System's interest in the administration of state property. An injunction preventing private entities from operating the Center in a manner that violates Title III, however, does not restrain the actions of the State of Nevada or compel it to act. 114 University System similarly claims that it has a legally protected interest in future contractual relations with Events or other entities. See Am. Greyhound Racing, Inc. v. Hull, 305 F.3d 1015, 1024 (9th Cir.2002). American Greyhound Racing reasoned that the fact that the district court's injunction applied only to the execution of future compacts or extension of existing ones did not limit the prejudice to the absent party's legal interests, as the injunction amounted to a declaratory judgment that the absent party's activities were illegal. See id. (The sovereign power of the tribes to negotiate compacts is impaired by the ruling.). Here, for reasons already discussed, a judgment against Events and Cowboys would not be the equivalent of a declaratory judgment that University System's operations are illegal. 115 Although this lawsuit does not bear on the extent of University System's own compliance with Title II, it is true that, as a practical matter, a judgment against Events or Cowboys could dissuade other private entities subject to Title III from entering into agreements with University System for use of the Center. We are cognizant that, should Disabled Rights prevail, University System stands to lose a valuable source of income — not an insubstantial consideration. But a financial stake in the outcome of the litigation is not a legally protected interest giving rise to § 19(a)(2) necessity. See Makah Indian Tribe v. Verity, 910 F.2d 555, 558 (9th Cir.1990). 116 Accordingly, we hold that the district court abused its discretion in concluding that University System is a necessary party. Because University System is not a necessary party under Rule 19(a), we do not consider under Rule 19(b) whether the action should be dismissed because the absent party cannot be joined. 17 117 We note in closing that ordinarily, in a case in which the property owner is a public entity and the operator of the public accommodation is a private entity, it will be in the plaintiff's best interest to sue both the landlord, under Title II, and the operator of the public accommodation, under Title III, thereby affording the court the greatest flexibility in fashioning appropriate relief. We hold only that in this particular case, Disabled Rights' suit against the private operators of a public accommodation for violations of Title III may go forward without the joinder of University System, a public entity not subject to Title III.