Brooke v. Eastlake Hospitality Ventures LLC
3:25-cv-01031
| S.D. Cal. | Jul 1, 2025Background
- Theresa Brooke sued Eastlake Hospitality Ventures LLC for discrimination under the ADA and Unruh Act, alleging the hotel lacked a compliant access aisle at the passenger loading zone.
- Eastlake responded by filing an answer and a counterclaim, asserting it was a third-party beneficiary to a settlement between Brooke and Disney Way Hotel Partners LLC (which included a covenant not to sue Eastlake).
- Brooke moved to dismiss her own complaint, stating the prior settlement barred her lawsuit; she also moved to dismiss Eastlake’s counterclaim for lack of subject matter jurisdiction.
- Both parties agreed to dismiss the counterclaim without prejudice if Brooke’s complaint was dismissed, with each side bearing its own costs and fees for the counterclaim.
- The remaining dispute was whether Eastlake, as the prevailing party, was entitled to recover costs related to Brooke’s initial complaint.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Dismissal of Brooke’s complaint | Settlement bars her complaint; dismiss with prejudice, each side bears costs. | No opposition to dismissal; seeks costs as prevailing party. | Complaint dismissed with prejudice; costs issue addressed separately. |
| Dismissal of Eastlake’s counterclaim | Lack of subject matter jurisdiction after complaint dismissed. | Agrees ancillary jurisdiction lost with complaint dismissal. | Counterclaim dismissed without prejudice, each party bears own costs/fees. |
| Entitlement to costs as prevailing party | Eastlake is not a "prevailing party" under Rule 54(d); even if so, costs should be denied for conduct. | Is a prevailing party under Rule 54(d)(1), seeks costs as of right. | Eastlake is prevailing party entitled to costs; motion to tax costs will determine amount. |
| Voluntary vs involuntary dismissal | Claims her motion is analogous to voluntary dismissal—costs shouldn’t attach. | Contends this is not a voluntary dismissal under Rule 41(a). | Court agrees it is not a voluntary dismissal; prevailing party rule applies. |
Key Cases Cited
- Marx v. Gen. Revenue Corp., 568 U.S. 371 (2013) (Rule 54(d)(1) provides for costs to prevailing party unless statute or rule says otherwise)
- Miles v. California, 320 F.3d 986 (9th Cir. 2003) (presumption in favor of awarding costs to prevailing parties)
- Save Our Valley v. Sound Transit, 335 F.3d 932 (9th Cir. 2003) (losing party bears burden to show why costs should not be awarded)
- Ass’n of Mexican-Am. Educators v. California, 231 F.3d 572 (9th Cir. 2000) (laying out factors for denying costs to prevailing party)