897 F. Supp. 2d 987
N.D. Cal.2012Background
- Moralez, wheelchair-bound, sues a Bay Place Whole Foods and Bond for disability-access violations under state and federal laws.
- Moralez alleges multiple parking, path-of-travel, store interior, and checkout design barriers over two years prior to filing (Mar. 2, 2012).
- Velasco, a separate class action against Whole Foods and related entities, settled in California state court with a settlement incorporating a broad release and injunctive relief affecting many California stores.
- The Velasco Judgment released claims against Whole Foods entities for discriminatory conduct but did not release claims against landlords like Bond; it included a No Third Party Beneficiaries provision.
- Bond was not a party to Velasco, but Moralez seeks to bar her claims under res judicata or release theories based on Velasco; Velasco was incorporated into a final judgment in 2012.
- The court partially grants dismissal against Whole Foods but preserves Moralez’s claims against Bond subject to further analysis of preclusion and due-process considerations.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Velasco precludes Moralez’s claims against Whole Foods. | Moralez barred because identical factual predicates. | Velasco release covers Whole Foods-related claims. | Partially precluded; Whole Foods claims dismissed, but some issues remain against Bond. |
| Whether Bond can benefit from Velasco release/preclusion. | Bond not a party to Velasco, should be barred as third party. | Non-parties may be bound by release under certain theories. | Bond may rely on Velasco/related principles; not fully barred. |
| Whether Moralez’s physical-injury claims fall within Velasco’s exclusion. | Claims involve emotional distress and fear; could be pleaded as injury. | Velasco excludes “personal injury claims as a result of physical injury.” | Not barred; not a “personal injury claim” under Velasco. |
| Whether Velasco’s temporal scope covers post-judgment claims by Moralez. | Claims arising after judgment may not be released. | Settlement released claims through term of settlement. | Claims arising within release period barred; post-judgment claims depend on scope. |
| Whether Velasco suffered inadequate representation/notice as to Moralez. | Velasco inadequately represented leased-store patrons and emotional-trauma claimants. | Epstein III limited collateral review; notice adequate. | Limited collateral review rejected; alternatively, representation found adequate; notice deemed adequate. |
Key Cases Cited
- Reyn's Pasta Bella, LLC v. Visa USA Inc., 442 F.3d 741 (9th Cir. 2006) (non-parties may rely on settlement release when release covers them and is intended to bar such claims)
- Class Plaintiffs v. City of Seattle, 955 F.2d 1268 (9th Cir. 1992) (settlements may release third parties depending on intent)
- Brae Transp., Inc. v. Coopers & Lybrand, 790 F.2d 1439 (9th Cir. 1986) (preclusion scope tied to settlement terms and final judgment)
- Hesse v. Sprint Corp., 598 F.3d 581 (9th Cir. 2010) (court scrutinizes adequacy of class representation in collateral review)
- Epstein v. MCA, Inc., 179 F.3d 641 (9th Cir. 1999) (limits collateral review of due-process adequacy in class actions)
- Rice v. Crow, 81 Cal.App.4th 725 (Cal. Ct. App. 2000) (settlement lacks implied collateral estoppel unless explicit intent)
- Nottingham Partners v. Trans-Lux Corp., 925 F.2d 29 (1st Cir. 1991) (distinguishes preclusion vs. release in settlements)
- Molski v. Gleich, 318 F.3d 937 (9th Cir. 2003) (discusses adequacy of class representation in damages context)