Olympus Spa et al v. Ortiz, No. 2:2022cv00340 - Document 21 (W.D. Wash. 2023)
Court Description: ORDER granting Defendant's 13 Motion to Dismiss without prejudice. Plaintiffs may file an amended complaint within 30 days of the date of this Order. Signed by Judge Barbara J. Rothstein. (SB)
Olympus Spa et al v. Ortiz Doc. 21 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 1 of 40 1 2 3 4 5 6 7 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE 8 9 10 OLYMPUS SPA, et al., 11 Plaintiffs, 12 v. 13 CASE NO. 22-CV-00340-BJR ORDER GRANTING MOTION TO DISMISS ANDRETA ARMSTRONG, 14 Defendant. 15 16 This matter comes before the Court on Defendant Andreta Armstrong’s 1 Motion to 17 Dismiss. Dkt. No. 13. On June 2, 2023, the Court heard oral argument on the motion, and after 18 thorough review of the record and the governing law, the Court grants the motion and dismisses 19 Plaintiffs’ complaint without prejudice. Dkt. No. 1. 20 21 22 1 23 24 Plaintiffs originally sued Sharon Ortiz in her official capacity as the Executive Director of the Washington State Human Rights Commission. See Dkt. No. 1 at 1. Ms. Ortiz has since retired, and Ms. Armstrong is now the Executive Director of the Commission. Dkt. No. 13 at 7 n.1. The Court therefore substitutes Director Armstrong as the defendant in this suit and directs the Clerk to update the case caption accordingly. See Fed. R. Civ. P. 25(d). ORDER GRANTING MOTION TO DISMISS - 1 Dockets.Justia.com Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 2 of 40 1 I. BACKGROUND 2 This case involves a First Amendment challenge to Washington’s Law Against 3 Discrimination (the “WLAD”). See Wash. Rev. Code § 49.60 et seq. Before delving into the facts 4 of the dispute, the Court will provide some historical and statutory context. 5 A. Public Accommodation Laws, the WLAD, and the Washington State Human Rights Commission 6 The WLAD “is a regulatory law enacted under the legislature’s police power to promote 7 the health, peace, safety, and general welfare of the people of Washington.” Ockletree v. 8 Franciscan Health Sys., 317 P.3d 1009, 1012 n.2 (Wash. 2014) (plurality opinion); see Wash. Rev. 9 Code § 49.60.010. To borrow from the Supreme Court, it is one of “many public accommodations 10 statutes across the Nation”—laws that “are well within the State’s usual power to enact when a 11 legislature has reason to believe that a given group is the target of discrimination[.]” Hurley v. 12 Irish-Am. Gay, Lesbian & Bisexual Grp. of Boston, 515 U.S. 557, 571–72 (1995) (public 13 accommodation laws “do not, as a general matter, violate the First or Fourteenth Amendment”); 14 Masterpiece Cakeshop, Ltd. v. Colo. Civil Rights Comm’n, 138 S. Ct. 1719, 1727 (2018) (“[I]t is 15 a general rule that [religious and philosophical] objections do not allow business owners and other 16 actors in the economy and in society to deny protected persons equal access to goods and services 17 under a neutral and generally applicable public accommodations law.”). 18 Washington lawmakers have expanded the WLAD’s reach over the years to “bar 19 discrimination on the basis of age, sex, sexual orientation, and disability, and to incorporate a 20 private right of action for employees and persons who use public accommodations.” Woods v. 21 Seattle’s Union Gospel Mission, 481 P.3d 1060, 1064 (Wash. 2021). With this expansion, “the 22 potential for conflict between state public accommodation laws and the First Amendment rights 23 of organizations has increased.” Boy Scouts of Am. v. Dale, 530 U.S. 640, 657 (2000); see, e.g., 24 ORDER GRANTING MOTION TO DISMISS - 2 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 3 of 40 1 Green v. Miss United States of Am., LLC, 52 F.4th 773 (9th Cir. 2022) (forcing pageant to accept 2 transgender woman pursuant to Oregon’s public accommodation law violated First Amendment); 3 303 Creative LLC v. Elenis, 6 F.4th 1160, 1176–88 (10th Cir. 2021) (application of Colorado’s 4 public accommodation law to website designer who refused to create websites celebrating same- 5 sex marriages did not violate First Amendment). Indeed, the Washington Supreme Court recently 6 confronted—and dispensed with—a florist’s First Amendment challenge to the WLAD. See State 7 v. Arlene’s Flowers, Inc., 441 P.3d 1203, 1224–36 (Wash. 2019). It is against this backdrop that 8 the suit at hand arises. 9 As relevant here, the WLAD recognizes “[t]he right to be free from discrimination because 10 of . . . sexual orientation[.]” Wash. Rev. Code § 49.60.030(1). This general right includes “[t]he 11 right to the full enjoyment of any of the accommodations, advantages, facilities, or privileges of 12 any place of public resort, accommodation, assemblage, or amusement[.]” Id. § 49.60.030(1)(b); 13 see also id. § 49.60.215 (declaring discrimination based on sexual orientation an “unfair 14 practice”). 2 The statute defines “sexual orientation” as “heterosexuality, homosexuality, 15 bisexuality, and gender expression or identity.” Id. § 49.60.040(27). And “gender expression or 16 identity” is further defined as “having or being perceived as having a gender identity, self-image, 17 appearance, behavior, or expression, whether or not that gender identity, self-image, appearance, 18 behavior, or expression is different from that traditionally associated with the sex assigned to that 19 person at birth.” Id. 20 21 22 23 24 2 Under the WLAD, “full enjoyment of” encompasses “the right to purchase any service, commodity, or article of personal property offered or sold on, or by, any establishment to the public, and the admission of any person to accommodations, advantages, facilities, or privileges or any place of public resort, accommodation, assemblage, or amusement, without acts directly or indirectly causing persons of any particular . . . sexual orientation . . . to be treated as not welcome, accepted, desired, or solicited.” Wash. Rev. Code § 49.60.040(14). ORDER GRANTING MOTION TO DISMISS - 3 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 4 of 40 1 Although the WLAD provides a private right of action for “[a]ny person deeming himself 2 or herself injured” by a violation of the statute, see id. § 49.60.030(2), the legislature also created 3 the Washington State Human Rights Commission (the “Commission”) to superintend enforcement 4 of the law, see id. § 49.60.010 (vesting the Commission with “general jurisdiction and power” to 5 eliminate and prevent discrimination). The Commission does so through an administrative scheme. 6 First, any person “aggrieved by an alleged unfair practice” may file a complaint with the 7 Commission identifying “the person alleged to have committed the unfair practice and the 8 particulars thereof[.]” Id. § 49.60.230(1)(a). The Commission then “prompt[ly] review[s] and 9 evaluat[es] the complaint” to determine whether the facts stated therein constitute an “unfair 10 practice.” Id. § 49.60.240(1)(a). If they do not, “a finding of no reasonable cause may be made 11 without further investigation.” Id. If, however, the facts could “constitute an unfair practice” under 12 the WLAD, the Commission conducts “a full investigation and ascertainment of the facts[.]” Id. 13 The results of the full investigation must then be “reduced to written findings of fact” and 14 the Commission issues a formal finding “that there is or that there is not reasonable cause for 15 believing that an unfair practice has or is being committed.” Id. § 49.60.240(2). Both the 16 complainant and the target of the complaint (the “respondent”) receive a copy of the formal 17 findings. Id. Where, as in this case, the Commission finds reasonable cause to believe an unfair 18 practice has been committed or remains afoot, it “shall immediately endeavor to eliminate the 19 unfair practice by conference, conciliation, and persuasion.” Id. § 49.60.240(3). The next step is 20 particularly relevant here: “If an agreement is reached for the elimination of such unfair practice 21 as a result of such conference, conciliation, and persuasion, the agreement shall be reduced to 22 writing and signed by the respondent, and an order shall be entered by the commission setting forth 23 the terms of said agreement.” Id. Any such conciliation agreement “shall be an agreement between 24 the respondent and the complainant and shall be subject to the approval of the commission.” Id. If ORDER GRANTING MOTION TO DISMISS - 4 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 5 of 40 1 the parties cannot reach a conciliation agreement, the dispute is referred for a hearing before an 2 administrative law judge, following which the parties may seek judicial review. See id. 3 § 49.60.250. 4 B. Olympus Spa and Other Plaintiffs 5 Myoon Woon Lee has owned and operated Olympus Spa for over 20 years. Dkt. No. 1 at 6 4. Joining him and his business as plaintiffs in this suit are Sun Lee (the president of Olympus 7 Spa), Jane Doe Employees 1-3, and Jane Doe Patron. See id. at 3. The Olympus Spa is a Korean 8 spa “specifically designed for women,” and the services offered there “are closely tied to the 9 Korean tradition,” meaning patrons are “require[d] . . . to be naked” during certain services. Id. at 10 3–4; see also id. at 5 (“It is Olympus Spa’s business purpose to provide traditional Korean kiln 11 saunas and exfoliation therapy experiences.”); Dkt. No. 1-2 at 3 (“Our spa is designed specifically 12 for women and our mission is to restore and rejuvenate women’s physical health as well as spiritual 13 health.”). The facilities include “a bath area containing multiple whirl-pools, a traditional Korean 14 body-scrub service area, standing showers, sit-down showers, a steam room, and a dry sauna.” 15 Dkt. No. 1 at 4. As noted, patrons are “typically fully naked” while utilizing these areas and thus 16 “have visual access” to other nude patrons. Id. at 5. Nor is nudity optional. It is allegedly “required 17 for certain procedures called ‘Seshin’” pursuant to Korean tradition. Id. According to Plaintiffs, 18 female patrons receiving a Korean body scrub “must do so unclothed,” and all employees who 19 provide those scrubs (“ddemiri”) are women. Id. 20 Olympus Spa maintains a “female-only policy” under which it restricts admission to 21 women—or, more specifically, individuals who “physically present in the nude as . . . female.” 22 Id. at 5, 7. It apparently advertised this entry policy on its website with the following language: 23 “Biological women are welcome[.] It is the policy of Olympus Spa not to discriminate on the basis 24 of race, color, national original, sex, age, or disability in its programs or activities, as required by ORDER GRANTING MOTION TO DISMISS - 5 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 6 of 40 1 applicable laws and regulations.” Dkt. No. 1-3 at 13. Olympus Spa thus admits transgender women 2 only if they have “gone through post-operative sex confirmation surgery.” Dkt. No. 1 at 5, 7. 3 Plaintiffs attribute the policy to their “traditional, theologically conservative” Christian values. Id. 4 at 5. They believe in “modesty as between the sexes” and “hold the conviction that a male and 5 female should not ordinarily be in each other’s presence while in the nude unless married to each 6 other.” Id.; see also Dkt. No. 1-2 at 4 (“Women are in a vulnerable position when they are 7 unclothed and/or having treatment while unclothed and we seek to ensure that they feel their 8 privacy and rights are respected. This is a biblical principle from 1 Peter 3:7, 1 Timothy 3:1-7, 1 9 Timothy 5:2, Phillipians 4:3, Genesis 1:27, Proverbs 31:17, Phillipians 2:3 and more.”). The Jane 10 Doe Employees accordingly refuse to perform massages or body scrubs on naked men. Dkt. No. 11 1 at 5–6. And Jane Doe Patron, a Christian “who frequently receives treatments at Olympus Spa,” 12 likewise “believes that men and women should not be viewing each other’s naked bodies unless 13 married to each other.” Id. at 6. 14 There have nonetheless been “incidents” in which men have “penetrate[d] the interior” of 15 an Olympus Spa facility. Id. For example, six years ago a customer alerted employees that an 16 individual “with male genitals was roaming around the spa.” Id. at 6–7. The on-duty manager 17 investigated the issue and determined that a “transgender woman with male genitals” was using 18 the facilities. Id. at 7. Although the transgender patron left after the manager explained the female- 19 only policy, other customers requested refunds and left the spa. Id. Plaintiffs allege that several 20 such incidents have occurred in which patrons “noticed male genitals exposed in the locker room 21 and/or pool area” and, as a result, experienced “humiliation, trauma, and rage[.]” Id. Those patrons 22 apparently demanded refunds and never returned. Id. 23 24 ORDER GRANTING MOTION TO DISMISS - 6 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 7 of 40 1 C. 2 In February 2020, Haven Wilvich—a transgender woman who “identifies as a woman” but 3 “is biologically male and has not undergone sex reassignment surgery”—filed a complaint with 4 the Commission. Id.; see Dkt. No. 1-3 at 4 (Notice of Complaint of Discrimination indicating that 5 complaint was filed on February 13, 2020). Ms. Wilvich’s complaint alleges that she went to 6 Olympus Spa in January 2020 in search of services but was discriminated against “because of [her] 7 sexual orientation” and “denied . . . equal services based on [her] sexual orientation.” Dkt. No. 1- 8 3 at 2. According to Ms. Wilvich, she was denied services and told “that transgender women 9 without surgery are not welcome because it could make other customers and staff uncomfortable.” 10 Haven Wilvich and the Commission Complaint Id. 3 11 Although Ms. Wilvich’s complaint is dated May 2020, it was not until November 2020 that 12 the Commission mailed an initial Notice of Complaint of Discrimination to Olympus Spa. Dkt. 13 No. 1 at 8; Dkt. No. 1-3 at 4. This first notice required “[n]o action” from Olympus Spa because it 14 was “for timely notification purposes only[.]” Dkt. No. 1-3 at 4. As for the circumstances and basis 15 of the complaint, the notice has a box checked next to “sexual orientation” and summarizes the 16 issues as follows: “Complaint alleges discrimination based on Sexual Orientation.” Id. The notice 17 also directs Olympus Spa to use the listed Commission complaint number “[f]or further inquiry 18 on this matter” and provides contact information for “[y]our written response, position statement, 19 20 21 22 23 24 3 Plaintiffs dispute the veracity of Ms. Wilvich’s complaint. In his declaration, Olympus Spa President Sun Lee suggests that Ms. Wilvich would not have been denied entry to the spa because patrons “are checked in using electronic check in stations,” patrons “do not interface with owners,” and, “[g]enerally speaking,” employees “have no idea if a preoperative transgender violates the policy of the spa until they are undressed.” Dkt. No. 1-2 at 2. Olympus Spa performed an internal investigation “to determine when the alleged discrimination happened and . . . who denied entry” to Ms. Wilvich but “found no record” of Ms. Wilvich having been at either the Tacoma or Lynnwood locations: “We keep records via an electronic sign in portal of all individuals who enter the spa. They fill out their information prior to being admitted in the waiting area. Haven Wilvich would have submitted such information[.]” Id. at 2–3. Because Olympus Spa employees have no “recollection of speaking with a Haven Wilvich,” Mr. Lee concludes that Olympus Spa, its owners, and its employees have been “targeted by Haven Wilvich for [their] beliefs/creed.” Id. at 3. ORDER GRANTING MOTION TO DISMISS - 7 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 8 of 40 1 response to our request for information, or any inquiry you may have[.]” Id. The Commission 2 simultaneously issued a letter advising Olympus Spa of its duty “to preserve all evidence that may 3 be relevant to this complaint” and warning that refusal to turn over requested information would 4 result in “a subpoena and order compelling production[.]” Id. at 5. 5 In March 2021, the Commission served Olympus Spa with a second Notice of Complaint 6 of Discrimination. Id. at 7. This time it requested “a written response” to Ms. Wilvich’s complaint, 7 “including a statement of [Olympus Spa’s] position o[n] the issues covered by th[e] Complaint, 8 with copies of any supporting documentation[.]” Id. The second notice also apprised Olympus Spa 9 of the Commission’s early resolution services: “The [Commission] may assist the parties in early 10 resolution of this Complaint through joint fact finding conferences and/or settlement negotiation 11 which gives the parties an opportunity to resolve the issues . . . without extensive investigation or 12 expenditure of resources.” Id. Olympus Spa was invited to contact the assigned Civil Rights 13 Investigator—here, Madison Imiola—if it was interested in participating in the settlement services. 14 Id. Enclosed in the second notice was a copy of Ms. Wilvich’s May 2020 complaint. Id. at 7–8. 15 D. Olympus Spa Disputes the Complaint 16 In March 2021, President Sun Lee authored a letter to the Commission in which he 17 defended Olympus Spa’s “women-only rule” and denied any violation of the WLAD. Id. at 10. 18 There he set forth Olympus Spa’s history and purpose as a “family-owned women’s Korean 19 traditional health spa” and explained that “[n]udity is required for certain procedures[.]” Id. (“We 20 firmly believe it is essential for the safety, legal protection, and well-being of our customers and 21 employees that we maintain adherence to this adaptation of a females-only rule.”). Mr. Lee then 22 detailed the “cultural underpinnings” of the services offered at Olympus Spa—services “closely 23 24 ORDER GRANTING MOTION TO DISMISS - 8 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 9 of 40 1 tied to the Korean tradition known as ‘jjimjilbang’[.]” Id. 4 In Olympus Spa’s view, “nudity and 2 females-only . . . cannot be segregated from the cultural requirements for ‘seshin’ services[.]” Id. 3 at 11. Citing Washington’s laws on lewd conduct, facilitating lewd conduct, and public indecency, 4 Mr. Lee conveyed his fear that exposing female customers (especially minors) to male genitalia 5 could subject Olympus Spa to criminal penalties. Id. at 11–12. He concluded the letter by 6 indicating that Olympus Spa was “willing to consider a review of [its] current biological females 7 only policy” with one caveat: “we are unwilling to remake the ‘jjimjilbang’ haven we have worked 8 so hard over many years to build and preserve, simply for the sake of promoting gender neutrality.” 9 Id. at 12. 10 Ms. Imiola responded two weeks later. See id. at 15–16. After reviewing the evidence and 11 Mr. Lee’s letter, she determined that Olympus Spa’s “biological women” policy violates the 12 WLAD because it discriminates based on gender identity. Id. at 15. More specifically, Ms. Imiola 13 opined that the policy “denies services to transgender women who have not had surgery . . . because 14 their physical appearance is not ‘consistent’ with the traditional understanding of biological 15 women.” Id. She further observed that the WLAD “does not use genitals to define gender identity 16 and . . . recognizes that a person’s gender identity can be different from the biological sex assigned 17 to that person at birth.” Id. at 15–16 (“However, Olympus Spa’s ‘biological women’ policy focuses 18 on the genitals of patrons rather than allowing transgender women to access your facilities based 19 on their gender identity[.]”). Ms. Imiola’s letter served a dual purpose. In addition to stating her 20 findings, she wrote “to offer Olympus Spa the opportunity to enter into a Pre-Finding Settlement 21 (PFS) Agreement.” Id. at 15. As her letter explains, such settlement agreements are “used to 22 resolve the issues of a complaint prior to completing the investigative process.” Id. Ms. Imiola 23 24 4 “Jjimjilbang” is Korean for “steamed-quality room.” Dkt. No. 1-3 at 10. ORDER GRANTING MOTION TO DISMISS - 9 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 10 of 40 1 guaranteed that a PFS Agreement would preclude Ms. Wilvich from taking any further legal action 2 with respect to the complaint allegations, made clear that such an agreement would not require an 3 admission of guilt, and promised that the Commission “would take no further action on the issues 4 of the complaint.” Id. In sum, a PFS Agreement was Olympus Spa’s “opportunity” to “revise [its] 5 policies and practices,” bring itself “into compliance with the law, avoid the costs of non- 6 compliance and litigation, and reduce the likelihood of future complaints.” Id. Ms. Imiola 7 concluded her letter with a threat: “If I do not hear from you within ten business days, I will 8 conclude that Olympus Spa is not interested in settling the case and will proceed accordingly by 9 preparing the case for referral to the Attorney General’s Office for prosecution.” Id. at 16. 10 Mr. Lee did not respond for over a month. Id. at 18. When he finally did, it was to inform 11 Ms. Imiola that Olympus Spa had no record of Ms. Wilvich’s visit. Id. Nor could staff members 12 recall any allegedly discriminatory interaction with any customer. Id. Mr. Lee asked whether Ms. 13 Wilvich could provide more information about her January 2020 experience so that Olympus Spa 14 could better “assist in ensuring that no person, especially Haven, feels discriminated against.” Id. 15 Ms. Imiola replied that the Commission had already made its determination: Olympus Spa’s 16 “biological women” policy violates the WLAD. Id. at 20. Ms. Imiola encouraged Olympus Spa to 17 “strongly consider entering into a Pre-Finding Settlement (PFS) agreement” and reiterated the 18 benefits of doing so: “an opportunity to avoid the costs of non-compliance and litigation; a 19 reduction in the likelihood of future complaints against Olympus Spa; and the ability to resolve 20 the complaint without an admission of guilt or formal findings of fact entered against Olympus 21 Spa.” Id. And she again warned that declining a PFS agreement would result in “referral to the 22 Attorney General’s Office for prosecution.” Id. 23 24 ORDER GRANTING MOTION TO DISMISS - 10 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 11 of 40 1 E. Olympus Spa Enters into a Pre-Finding Settlement Agreement 2 Mr. Lee subsequently indicated Olympus Spa’s desire to correct its allegedly 3 discriminatory policy and requested “the Pre-Finding Settlement details.” Id. at 22. Although he 4 continued to dispute the veracity of Ms. Wilvich’s complaint, Mr. Lee informed Ms. Imiola that 5 the “biological women” policy had been removed from Olympus Spa’s website. Id. Ms. Imiola 6 responded in a letter setting forth—and seeking Olympus Spa’s agreement to—three settlement 7 terms that the Commission identified as “of interest” in “moving forward with the resolution of 8 this case.” Id. at 24. First, Olympus Spa would be required to “remove references to ‘biological 9 women’” from its website. Id. Ms. Imiola recognized that Olympus Spa had “already addressed” 10 this term and promised that the PFS agreement would “memorialize” the change. Id. Second, the 11 Commission would provide Olympus Spa with “training materials” to ensure its understanding of 12 and future compliance with the WLAD. Id. As for the third and final term, the Commission wished 13 to review all Olympus Spa policies to ensure compliance with the WLAD. Id. Olympus Spa agreed 14 to these terms. See id. at 26. 15 Although the Commission agreed to close the Wilvich complaint, it retained the right to 16 “investigate and prosecute th[at] complaint” if Olympus Spa failed to comply with any terms of 17 the agreement. Id. at 36; see also id. at 37 (“[T]he Commission may take action including, among 18 other remedies, continuing its investigation or bringing an action in court for specific performance 19 of this agreement.”). And the central terms of the agreement are as previewed in Ms. Imiola’s 20 letter. Olympus Spa was required to complete WLAD training within 60 days. Id. It was similarly 21 allotted 60 days to “[i]mplement and/or revise existing company policies as necessary to ensure 22 their compliance with the [WLAD].” Id. at 36 (“Respondent agrees that . . . it has adopted new 23 language on its website reflecting a non-discriminatory policy[.]”). And last, the PFS agreement 24 reserves Olympus Spa’s right to challenge the Commission’s application of the WLAD: “This ORDER GRANTING MOTION TO DISMISS - 11 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 12 of 40 1 agreement does not preclude Respondent, its employees, or patrons from exercising their 2 constitutional rights to . . . brin[g] a legal challenge as to the constitutionality of any term or 3 provision in this agreement [or] the operative statutes, including but not limited to [the WLAD.]” 4 Id. at 37. In October 2021, the Commission issued a notice of final agency action and officially 5 closed the Wilvich complaint. See id. at 34–39. 6 F. Olympus Spa Sues 7 In March 2022, Plaintiffs brought this Section 1983 suit alleging that enforcement of the 8 WLAD against them violates their First Amendment rights to free exercise of religion, freedom of 9 speech, and freedom of association. Dkt. No. 1 at 1, 13–15. Plaintiffs seek declaratory relief and 10 ask the Court to “preliminarily and permanently” enjoin the Commission from “enforcing the 11 public accommodation law and implementing regulations” against them. Id. at 15. They also seek 12 nominal damages. Id. Although Plaintiffs primarily frame their lawsuit as a pre-enforcement 13 challenge, see Dkt. No. 14 at 12–15, they also seek retrospective relief for allegedly compelled 14 speech. See id. at 27 (requesting nominal damages as redress for a “completed” constitutional 15 violation). 16 With respect to their free exercise claim, Plaintiffs allege that enforcement of the WLAD 17 “requires them to service nude males and females in the same rooms” and thus forces them to 18 “choose between violating the law or their religious convictions.” Dkt. No. 1 at 14. According to 19 Plaintiffs, this constitutes “a substantial burden on their religious beliefs.” Id. Their free association 20 claim is similarly framed in prospective terms. Plaintiffs allege that enforcement of the WLAD, 21 “which would require females in a state of nature to remain in the presence of naked males,” 22 violates their right “to selectively enter into and carry on intimate or private relationships—or 23 refrain from such relationships.” Id. at 15. In contrast to these two claims, Plaintiffs’ free speech 24 action is retrospective. They assert that the Commission required Olympus Spa to “remove ORDER GRANTING MOTION TO DISMISS - 12 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 13 of 40 1 language from its website that has a viewpoint that ‘biological women’ are females and distinct 2 from males.” Id. at 14. And because Olympus Spa “does not hold the view that transgender women 3 are female,” forcing it to adopt a new, nondiscriminatory policy on its website “compels speech 4 about a moral issue [with] which Plaintiffs disagree.” Id. 5 The Commission promptly moved to dismiss the complaint pursuant to Federal Rule of 6 Civil Procedure 12(b)(1) and (b)(6). Dkt. No. 13 at 13. 5 In the Commission’s view, the Court lacks 7 subject matter jurisdiction over this action because Plaintiffs do not have standing. Id. It further 8 contends that, even if the Court has jurisdiction, Plaintiffs’ claims fail as a matter of law. Id. at 13– 9 14. 10 II. 11 DISCUSSION The Court rejects the Commission’s standing argument. With respect to the merits of 12 Plaintiffs’ claims, however, the Court agrees that all three fail as a matter of law. 13 A. Rule 12(b)(1) Motion to Dismiss 14 A motion to dismiss for lack of subject matter jurisdiction can either attack the sufficiency 15 of the pleadings on their face (a “facial attack”) or present affidavits or other evidence that contest 16 the truth of the allegations in the pleadings (a “factual attack”). Sullivan v. Ferguson, No. 3:22- 17 CV-05403-DGE, 2022 WL 13969427, at *2 (W.D. Wash. Oct. 24, 2022) (citing Wolfe v. 18 Strankman, 392 F.3d 358, 362 (9th Cir. 2004)). Because the Commission does not offer affidavits 19 or other evidence challenging the truth of the allegations in the complaint, the Court construes its 20 motion as a facial attack on subject matter jurisdiction. See id. And the Court resolves a facial 21 22 23 24 5 Although Director Strobert is the only named defendant in this suit, the Court attributes the motion to dismiss (and the arguments therein) to the Commission. See Kentucky v. Graham, 473 U.S. 159, 165 (1985) (“Official-capacity suits, in contrast, ‘generally represent only another way of pleading an action against an entity of which an officer is an agent.’” (quoting Monell v. N.Y.C. Dep’t of Soc. Servs., 436 U.S. 658, 690 n.55 (1978))); see also Dkt. No. 13 at 29 (“HRC respectfully asks that [the] Court dismiss Plaintiffs’ Complaint, with prejudice, in its entirety.”). ORDER GRANTING MOTION TO DISMISS - 13 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 14 of 40 1 jurisdictional challenge “as it would a motion to dismiss under Rule 12(b)(6): Accepting the 2 plaintiff’s allegations as true and drawing all reasonable inferences in the plaintiff’s favor, the 3 court determines whether the allegations are sufficient as a legal matter to invoke the court’s 4 jurisdiction.” Leite v. Crane Co., 749 F.3d 1117, 1121 (9th Cir. 2014). The Court presumes that a 5 case lies outside of its “limited jurisdiction” unless Plaintiffs establish otherwise. Kokkonen v. 6 Guardian Life Ins. Co., 511 U.S. 375, 377 (1994). 7 1. 8 The Commission first contends that Plaintiffs lack standing to bring this action. Dkt. No. 9 13 at 15–22; see Maya v. Centex Corp., 658 F.3d 1060, 1067 (9th Cir. 2011) (dismissal under Rule 10 Standing 12(b)(1) is appropriate when the plaintiff lacks standing). 11 “Under Article III, the Federal Judiciary is vested with the ‘Power’ to resolve not questions 12 and issues but ‘Cases’ or ‘Controversies.’” Ariz. Christian Sch. Tuition Org. v. Winn, 563 U.S. 13 125, 132 (2011). “Among other things, that limitation requires a plaintiff to have standing.” Fed. 14 Election Comm’n v. Cruz, 142 S. Ct. 1638, 1646 (2022). And the three elements of standing “are 15 well established: A plaintiff must show (1) an injury in fact, (2) fairly traceable to the challenged 16 conduct of the defendant, (3) that is likely to be redressed by the requested relief.” Id. Plaintiffs 17 bear the burden of establishing each of these elements “with the manner and degree of evidence 18 required at the successive stages of the litigation.” Lujan v. Defenders of Wildlife, 504 U.S. 555, 19 561 (1992). “At the pleading stage, general factual allegations of injury resulting from the 20 defendant’s conduct may suffice[.]” Id.; accord Tingley v. Ferguson, 47 F.4th 1055, 1066 (9th Cir. 21 2022); see also Spokeo, Inc. v. Robins, 578 U.S. 330, 338 (2016) (a plaintiff must “clearly allege” 22 facts demonstrating each standing element (cleaned up)). 23 The Court addresses whether Olympus Spa has standing to bring this suit because the 24 presence of one plaintiff with standing is sufficient to satisfy Article III’s case-or-controversy ORDER GRANTING MOTION TO DISMISS - 14 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 15 of 40 1 requirement. Rumsfeld v. F. for Acad. & Institutional Rights, Inc., 547 U.S. 47, 52 n.2 (2006) 2 (“FAIR”); accord Melendres v. Arpaio, 695 F.3d 990, 999 (9th Cir. 2012); Sullivan, 2022 WL 3 13969427, at *3. 6 This is so in injunctive cases, too. Atay v. Cnty. of Maui, 842 F.3d 688, 696 (9th 4 Cir. 2016). The Court first analyzes whether Olympus Spa has pre-enforcement standing to bring 5 its free exercise and free association claims (Counts 1 and 3), then discusses whether Olympus Spa 6 has standing to vindicate its compelled speech claim (Count 2). 7 7 a. Injury in Fact: Pre-Enforcement Claims 8 As for the “[f]irst and foremost” of standing’s three requirements, Steel Co., 523 U.S. at 9 103, the Commission contends that Plaintiffs “fail to allege that they are in any danger of sustaining 10 any injury that is both real and immediate.” Dkt. No. 13 at 16. The Court disagrees. 11 To establish an injury in fact, a plaintiff must show that it suffered “an invasion of a legally 12 protected interest” that is “concrete and particularized” and “actual or imminent, not conjectural 13 or hypothetical.” Lujan, 504 U.S. at 560 (cleaned up). Injury is particularized if it affects a plaintiff 14 “in a personal and individual way.” Id. at 560 n.1. And it is concrete if it “actually exist[s],” 15 meaning that it is “real, and not abstract.” Spokeo, 578 U.S. at 340 (cleaned up); see also id. 16 (“concrete” is not synonymous with “tangible,” as “intangible injuries can nevertheless be 17 concrete”). As for the “actual or imminent” requirement, the Supreme Court has “repeatedly 18 reiterated that threatened injury must be certainly impending to constitute injury in fact and that 19 20 21 6 The Court refers to “Plaintiffs” as a collective entity throughout this Order but analyzes their complaint and arguments in terms of whether they establish Olympus Spa’s standing. 7 22 23 24 Plaintiffs appear to suggest that the provision in the PFS agreement reserving their right to bring a constitutional challenge to the WLAD is sufficient to convey standing. See Dkt. No. 1 at 13 (“This lawsuit is an exercise of that right bargained for by the parties.”); Dkt. No. 14 at 11 (same). As the Commission notes, however, parties cannot contractually manufacture Article III standing or, by extension, federal subject matter jurisdiction. Dkt. No. 13 at 21; see United Invs. Life Ins. Co. v. Waddell & Reed Inc., 360 F.3d 960, 966–67 (9th Cir. 2004) (“It is well established that ‘lack of federal jurisdiction cannot be waived or be overcome by an agreement of the parties.’” (quoting Mitchell v. Maurer, 293 U.S. 237, 244 (1934))). ORDER GRANTING MOTION TO DISMISS - 15 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 16 of 40 1 allegations of possible future injury are not sufficient.” Clapper v. Amnesty Int’l, 568 U.S. 398, 2 409 (2013) (cleaned up); see San Diego Cnty. Gun Rights Comm. v. Reno, 98 F.3d 1121, 1126 (9th 3 Cir. 1996) (plaintiffs seeking declaratory and injunctive relief needed to show “a very significant 4 possibility of future harm”). However, the imminence requirement is “concededly a somewhat 5 elastic concept,” Lujan, 504 U.S. at 564 n.2, and a plaintiff is not required “to demonstrate that it 6 is literally certain that the harms [it] identif[ies] will come about,” Clapper, 568 U.S. at 414 n.5. 7 A “‘substantial risk’ that the harm will occur” can suffice. Id. (quoting Monsanto Co. v. Geertson 8 Seed Farms, 561 U.S. 139, 153 (2010)). 9 To this end, the Supreme Court has made clear that threatened enforcement of a law can 10 create Article III injury. See Susan B. Anthony List v. Driehaus, 573 U.S. 149, 158 (2014) (“When 11 an individual is subject to such a threat, an actual arrest, prosecution, or other enforcement action 12 is not a prerequisite to challenging the law.”); LSO, Ltd. v. Stroh, 205 F.3d 1146, 1154 (9th Cir. 13 2000) (a plaintiff may establish standing “to challenge a law or regulation that is not presently 14 being enforced against them”). More specifically, “a plaintiff satisfies the injury-in-fact 15 requirement where he alleges ‘an intention to engage in a course of conduct arguably affected with 16 a constitutional interest, but proscribed by a statute, and there exists a credible threat of prosecution 17 thereunder.’” Driehaus, 573 U.S. at 164 (quoting Babbitt v. Farm Workers, 442 U.S. 289, 298 18 (1979)). A district court considers three factors when evaluating whether there is a credible threat 19 of prosecution or enforcement: (1) “whether the plaintiff ha[s] articulated a ‘concrete plan’ to 20 violate the law in question”; (2) “whether the prosecuting authorities have communicated a specific 21 warning or threat to initiate proceedings”; and (3) “the history of past prosecution or enforcement 22 under the challenged statute.” Thomas v. Anchorage Equal Rights Comm’n, 220 F.3d 1134, 1139 23 (9th Cir. 2000) (en banc). All three point towards a credible threat of enforcement here. 24 ORDER GRANTING MOTION TO DISMISS - 16 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 17 of 40 1 As for the first factor, “[a] concrete plan need not be ‘cast in stone’ but must be ‘more than 2 a hypothetical intent to violate the law.’” Arizona v. Yellen, 34 F.4th 841, 850 (9th Cir. 2022) 3 (quoting Thomas, 220 F.3d at 1139). The Commission argues that Plaintiffs’ complaint “fails to 4 allege any facts to indicate they are continuing to refuse service to transgender female patrons who 5 have not yet undergone gender transition surgery or even that they have a specific plan to begin 6 doing so.” Dkt. No. 13 at 17. But Plaintiffs do just that. In accordance with their conscience and 7 faith, the employees aver that they “will not perform services such as massages and body scrubs 8 on naked men,” by which they mean transgender women with male genitalia. Dkt. No. 1 at 5–6; 9 see also Dkt. No. 14 at 14 (“Thus, the Complaint alleges that the Spa cannot and will not let males 10 into the . . . facility where female nudity is a requirement, because it would violate their sincerely 11 held religious beliefs that men and women [are] not to be nude in each other’s presence.”). Refusal 12 to service customers who are transgender women with male genitalia necessarily evinces an intent 13 to violate the WLAD’s proscription against discrimination based on sexual orientation, at least 14 according to the Commission’s application of the WLAD in this case. See Harborview Fellowship 15 v. Inslee, 521 F. Supp. 3d 1040, 1047 (W.D. Wash. 2021) (plaintiff articulated a concrete plan to 16 violate mask mandate by alleging that individuals conducting services do not wear masks). 17 The Commission stretches the “concrete plan” requirement beyond what Driehaus calls 18 for: “Nothing in this Court’s decisions requires a plaintiff who wishes to challenge the 19 constitutionality of a law to confess that he will in fact violate that law.” 573 U.S. at 163; see also 20 Yellen, 34 F.4th at 850 (a plaintiff need not “admit to violating the law or having a desire to do 21 so”). The Ninth Circuit has further made clear that a plaintiff need not “specify ‘when, to whom, 22 where, or under what circumstances’ [it] plan[s] to violate the law when”—as here—it has “already 23 violated the law in the past.” Tingley, 47 F.4th at 1068 (quoting Thomas, 220 F.3d at 1139). The 24 Commission’s reliance on Plaintiffs’ inability to pinpoint when in the future a pre-surgery ORDER GRANTING MOTION TO DISMISS - 17 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 18 of 40 1 transgender woman might seek services at Olympus Spa and, in turn, be denied those services thus 2 misses the mark. Dkt. No. 15 at 3; see also, e.g., Stormans, Inc. v. Selecky, 586 F.3d 1109, 1123 3 (9th Cir. 2009) (pharmacists challenging state rules requiring them to sell Plan B could not “control 4 when a patient requesting Plan B w[ould] visit their pharmacy,” but nonetheless had standing 5 because they could “point to specific past instances when they h[ad] refused to sell Plan B” as 6 “direct violations of the challenged rules”). 8 The first Thomas factor weighs in favor of finding a 7 credible threat of enforcement and, by extension, Article III injury. 8 As to the second factor, Plaintiffs do more than “cit[e] a generalized threat that [the WLAD] 9 will be enforced”—they identify a threat of enforcement that is “particular to” Olympus Spa. 10 Cedar Park Assembly, 402 F. Supp. 3d at 989. Although the Commission has not issued warnings 11 or notices to Olympus Spa since the parties executed the PFS agreement, civil rights investigator 12 Imiola’s communications during the Wilvich investigation make clear the Commission’s position 13 on Olympus Spa’s “biological women” policy, as well as its intent to enforce the law against 14 Olympus Spa. See Yellen, 34 F.4th at 850 (finding second factor satisfied where there was 15 “affirmative conduct” by the government agency “evincing an intent to enforce” the law at issue); 16 Cal. Trucking Ass’n v. Bonta, 996 F.3d 644, 653 (9th Cir. 2021) (finding sufficient intent to enforce 17 a law where state agency “sent letters to businesses notifying them” of its interpretation of a new 18 requirement under state law); Lopez v. Candaele, 630 F.3d 775, 786 (9th Cir. 2010) (“[W]e have 19 considered a government’s preliminary efforts to enforce a speech restriction or its past 20 enforcement of a restriction to be strong evidence . . . that pre-enforcement plaintiffs face a credible 21 threat of adverse state action.”). 22 8 23 24 The Commission’s heavy reliance on the low probability of another Wilvich complaint is also unavailing, because its ability to enforce WLAD violations does not turn on a third-party complainant. The Commission may issue a complaint on its own “[w]henever it has reason to believe that any person has engaged in or is engaging in an unfair practice[.]” Wash. Rev. Code § 49.60.230(1)(b). ORDER GRANTING MOTION TO DISMISS - 18 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 19 of 40 1 Moreover, the PFS agreement requires Olympus Spa to bring and keep its policies in 2 compliance with the WLAD, see Dkt. No. 1-3 at 36, and provides the Commission with a 3 mechanism for enforcing that obligation, see id. at 37 (the Commission “shall determine whether 4 [Olympus Spa] has fully complied with the terms of th[e] agreement” and “shall” give written 5 notice to Olympus Spa “specifying the nature of [any] breach.”). And finally, the Commission has 6 not disavowed any intent to enforce the WLAD against Olympus Spa. See Stroh, 205 F.3d at 1155 7 (“Courts have also considered the Government’s failure to disavow application of the challenged 8 provision as a factor in favor of a finding of standing.”); accord Tingley, 47 F.4th at 1068. Indeed, 9 as the Court’s preceding discussion makes clear, the opposite is true. The second factor thus weighs 10 in favor of finding a credible threat of enforcement. 11 The third and final factor likewise supports this finding. As discussed above, the 12 Commission has not only indicated an intent to enforce the WLAD against Olympus Spa; it has 13 enforced the law against Olympus Spa. See Driehaus, 573 U.S. at 164 (finding threat of future 14 enforcement “substantial” where plaintiff organization “was the subject of a complaint in a recent 15 election cycle,” and observing that “past enforcement against the same conduct is good evidence 16 that the threat of enforcement is not chimerical.” (cleaned up)). Based on the three-factor Thomas 17 framework, the Court concludes that Plaintiffs’ feared injury is “sufficiently realistic and credible 18 to confer standing under Driehaus[.]” Yellen, 34 F.4th at 851. 19 b. Causal Connection: Pre-Enforcement Claims 20 Plaintiffs must next demonstrate “a causal connection between the injury and the conduct 21 complained of,” meaning “the injury has to be fairly traceable to the challenged action of the 22 defendant, and not the result of the independent action of some third party not before the court.” 23 Lujan, 504 U.S. at 560 (cleaned up). The Court finds that Plaintiffs have sufficiently traced 24 Olympus Spa’s injury to the Commission. See Sullivan, 2022 WL 13969427, at *4 (“That state ORDER GRANTING MOTION TO DISMISS - 19 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 20 of 40 1 officials are entrusted with the enforcement of state criminal laws and have the actual power to 2 enforce allegedly unconstitutional laws is sufficient to demonstrate ‘the requisite causal connection 3 for standing purposes.’” (quoting Planned Parenthood of Idaho, Inc. v. Wasden, 376 F.3d 908, 4 920 (9th Cir. 2004))). 5 The Commission nonetheless contends that Plaintiffs cannot show the requisite causal 6 connection because “[t]here is no ongoing State action against Olympus Spa or threat of imminent 7 State enforcement action against them.” Dkt. No. 13 at 20. “Any alleged ‘harm’ to Plaintiffs,” says 8 the Commission, “is being caused by Olympus Spa’s decision to change its discriminatory website 9 language [and] end its discriminatory business practices” pursuant to the PFS agreement. Id. Both 10 arguments fail. As for the first one, it is merely a repackaging of the Commission’s injury-in-fact 11 challenge, which the Court has already rejected because Olympus Spa faces a credible threat of 12 future enforcement. The first argument also overlooks the nature of pre-enforcement standing. 13 Olympus Spa seeks prospective relief from future enforcement of the WLAD. Thus, that the parties 14 settled the Wilvich complaint does not mean there is no causal connection between the threat of 15 future enforcement (the injury at issue) and the Commission. 16 Second, it is inaccurate to characterize the PFS agreement as a self-inflicted, invited, or 17 willingly incurred injury. Olympus Spa was forced to choose between self-censorship (the 18 agreement) and referral to the Attorney General for prosecution. Furthermore, the Supreme Court 19 has rejected this approach to the causation element of standing. See Cruz, 142 S. Ct. at 1647 (“[W]e 20 have made clear that an injury resulting from the application or threatened application of an 21 unlawful enactment remains fairly traceable to such application, even if the injury could be 22 described in some sense as willingly incurred.”). The Commission attempts to sidestep this 23 straightforward result by pointing to Clapper, an inapposite case in which the Supreme Court held 24 that the plaintiffs could not “manufacture standing merely by inflicting harm on themselves based ORDER GRANTING MOTION TO DISMISS - 20 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 21 of 40 1 on their fears of hypothetical future harm that is not certainly impending.” 568 U.S. at 416 2 (emphasis added); see Dkt. No. 15 at 5. eAs discussed above, Olympus Spa faces a threat of 3 enforcement sufficiently credible to establish Article III injury. 4 c. Redressability: Pre-Enforcement Claims 5 “Third, it must be ‘likely,’ as opposed to merely ‘speculative,’ that the injury will be 6 ‘redressed by a favorable decision.’” Lujan, 504 U.S. at 561 (quoting Simon v. E. Ky. Welfare 7 Rights Org., 426 U.S. 26, 38 (1976)). Plaintiffs are not required to guarantee that Olympus Spa’s 8 injuries will be redressed by a favorable decision. Renee v. Duncan, 686 F.3d 1002, 1013 (9th Cir. 9 2012). Rather, they “need only show that there would be a ‘change in a legal status,’ and that a 10 ‘practical consequence of that change would amount to a significant increase in the likelihood that 11 [they] would obtain relief that directly redresses the injury suffered.’” Id. (quoting Utah v. Evans, 12 536 U.S. 452, 464 (2002)). Plaintiffs’ burden under this element is “relatively modest.” Bennett v. 13 Spear, 520 U.S. 154, 171 (1997). 14 The Commission contests this element. In its eyes, Plaintiffs “plainly fail to demonstrate 15 redressability” because “there is nothing to enjoin.” Dkt. No. 15 at 6. The Commission again points 16 to the PFS agreement and claims that it extinguished any case or controversy. See Dkt. No. 13 at 17 21 (“[T]his Court cannot provide any relief to Plaintiffs because the settlement agreement ended 18 [the Commission’s] investigation of Olympus Spa[.]”). The Court has determined that Olympus 19 Spa faces a credible threat of future enforcement, and the settlement of the Wilvich complaint does 20 not speak to that injury. The relief Plaintiffs request would redress the injury at issue because it 21 would declare application of the WLAD to Olympus Spa’s “biological women” policy 22 unconstitutional. And an order enjoining future enforcement would obviously preclude the 23 Commission from penalizing that policy. The third standing element is met. 24 d. Standing to Bring “Completed” Free Speech Violation ORDER GRANTING MOTION TO DISMISS - 21 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 22 of 40 1 The Court further finds that Olympus Spa has standing to vindicate its allegedly compelled 2 speech. As an initial matter, “the inquiry tilts dramatically toward a finding of standing” whenever 3 First Amendment speech is implicated. Stroh, 205 F.3d at 1155; see also Cal. Pro-Life Council, 4 Inc. v. Getman, 328 F.3d 1088, 1094 (9th Cir. 2003) (“Particularly in the First Amendment- 5 protected speech context, the Supreme Court has dispensed with rigid standing requirements.”). 6 Plaintiffs have sufficiently alleged that Olympus Spa sustained an “actual” and “concrete” injury: 7 self-censorship. See Getman, 328 F.3d at 1095 (plaintiff “suffered the constitutionally recognized 8 injury of self-censorship.”); Tingley, 47 F.4th at 1067 (a chilling of the exercise of First 9 Amendment rights is itself a constitutionally sufficient injury). Olympus Spa removed the 10 “biological women” policy from its website in direct response to the Commission’s investigation 11 and under threat of penalties. Indeed, removal of that language was a term of the PFS agreement. 12 And the agreement suspends legal consequences for Olympus Spa only so long as it complies with 13 the terms, i.e., so long as it continues to self-censor. See Ariz. Right to Life Pol. Action Comm. v. 14 Bayless, 320 F.3d 1002, 1006–1007 (9th Cir. 2003) (organization “was forced to modify its speech 15 and behavior to comply with the statute”; it did not lack standing “merely because [it] chose to 16 comply with the statute and challenge its constitutionality, rather than to violate the law and await 17 an enforcement action.”). Contrary to the Commission’s suggestion, then, the PFS agreement does 18 not nullify the alleged constitutional injury. See Dkt. No. 13 at 18 (“Any justiciable case or 19 controversy between [the Commission] and Olympus Spa ended with the execution of the 20 settlement agreement[.]”). Nor does it matter that the Commission “stopped its investigation of 21 Olympus Spa,” made “[n]o formal finding of discrimination,” and closed the Wilvich complaint. 22 Id. 23 The remaining two standing elements are likewise satisfied. As already discussed, the 24 complained-of injury is traceable to the Commission because it is the state agency responsible for ORDER GRANTING MOTION TO DISMISS - 22 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 23 of 40 1 enforcing the WLAD. See Sullivan, 2022 WL 13969427, at *4. And that Olympus Spa elected to 2 self-censor rather than be referred to the Attorney General for prosecution does not defeat the 3 causal connection. See Cruz, 142 S. Ct. at 1647. Plaintiffs have likewise established that nominal 4 damages will redress Olympus Spa’s allegedly compelled speech. See Uzuegbunam v. Preczewski, 5 141 S. Ct. 792, 802 (2021) (“[A] request for nominal damages satisfies the redressability element 6 of standing where a plaintiff’s claim is based on a completed violation of a legal right.”). Olympus 7 Spa therefore has standing to assert its free speech claim. 8 2. Ripeness 9 The Commission also urges the Court to dismiss Plaintiffs’ complaint because their claims 10 are not ripe for judicial review. It argues that prospective relief is inappropriate here because 11 Plaintiffs’ claims “rest on contingent future events that may never happen.” Dkt. No. 13 at 22; see 12 also Dkt. No. 15 at 6 (“Plaintiffs[’] claims are not ripe for the same reasons they cannot establish 13 standing[.]”). 14 “Along with standing and mootness, ripeness is one of three justiciability requirements.” 15 Twitter, Inc. v. Paxton, 26 F.4th 1119, 1122 (9th Cir. 2022). “The basic rationale of the ripeness 16 requirement is to prevent the courts, through avoidance of premature adjudication, from entangling 17 themselves in abstract disagreements.” Id. at 1123 (cleaned up). The doctrine “is drawn both from 18 Article III limitations on judicial power and from prudential reasons for refusing to exercise 19 jurisdiction.” Reno v. Cath. Soc. Servs., Inc., 509 U.S. 43, 57 n.18 (1993). “Thus, in conducting a 20 traditional ripeness inquiry, we evaluate both ‘a constitutional and a prudential component.’” Clark 21 v. City of Seattle, 899 F.3d 802, 809 (9th Cir. 2018) (quoting Bishop Paiute Tribe v. Inyo Cnty., 22 863 F.3d 1144, 1153 (9th Cir. 2017)). However, the constitutional component “overlaps with the 23 ‘injury in fact’ analysis for Article III standing.” Wolfson v. Brammer, 616 F.3d 1045, 1058 (9th 24 Cir. 2010); see also Thomas, 220 F.3d at 1138. To the extent, then, that the Commission targets ORDER GRANTING MOTION TO DISMISS - 23 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 24 of 40 1 the constitutional component of ripeness by suggesting that Olympus Spa has not suffered an 2 injury, the Court rejects that argument for the reasons set forth supra. 3 The prudential component warrants some discussion. Under this portion of the ripeness 4 doctrine, the Court must evaluate (1) the fitness of the issues for judicial decision and (2) the 5 hardship to the parties of withholding judicial consideration. Paxton, 26 F.4th at 1123. “A claim 6 is fit for decision if the issues raised are primarily legal, do not require further factual development, 7 and the challenged action is final.” Skyline Wesleyan Church v. Cal. Dep’t of Managed Health 8 Care, 968 F.3d 738, 752 (9th Cir. 2020) (cleaned up). Also relevant to the fitness prong is “whether 9 the action has a direct and immediate effect on the complaining parties; whether the action has the 10 status of law; and whether the action requires immediate compliance with its terms.” Tingley, 47 11 F.4th at 1070 (cleaned up). As for the hardship prong, the Court considers whether the action 12 “requires an immediate and significant change in plaintiffs’ conduct of their affairs with serious 13 penalties attached to noncompliance.” Id. at 1070–71 (cleaned up). 14 The fitness prong is satisfied here. The Court acknowledges that the record is somewhat 15 “thin and sketchy.” Thomas, 220 F.3d at 1141 (record consisted of “a few conclusory affidavits”). 16 And as the Ninth Circuit has recognized, “bringing a First Amendment challenge to a law does not 17 necessarily mean that the issues presented are ‘purely legal.’” Tingley 47 F.4th at 1070 (quoting 18 Thomas, 220 F.3d at 1142). But as was the case in Tingley, the law at issue here—the WLAD— 19 “is final,” “represents Washington’s final decision with respect to prohibiting [discrimination 20 based on sexual orientation],” and is “binding” on Olympus Spa, which “must immediately comply 21 with its terms.” Id. And, unlike Thomas, where there were no aggrieved tenants, there was no 22 history of enforcement, and the record was devoid of any factual context, here the Commission’s 23 enforcement of the WLAD against Olympus Spa provides the Court with the requisite “concrete 24 factual scenario that demonstrates how the [WLAD], as applied, infringe[s] [Plaintiffs’] ORDER GRANTING MOTION TO DISMISS - 24 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 25 of 40 1 constitutional rights.” Thomas, 220 F.3d at 1141; see Paxton, 26 F.4th at 1124 (issues were not fit 2 for judicial decision because attorney general had not yet made an allegation against plaintiff, the 3 facts were not yet developed, and the plaintiff did not need to comply with the civil investigative 4 demand). Olympus Spa has also delineated the bounds of its “biological women” policy and 5 clarified to whom it applies. See Thomas, 220 F.3d at 1142 n.8 (scope of landlords’ religiously 6 driven tenant selection criteria was unclear). Thus, the record “is admittedly sparse,” but “there are 7 no incomplete hypotheticals or open factual questions akin to those in Thomas[.]” Stormans, 586 8 F.3d at 1126. 9 This case is materially identical to Stormans. Although the plaintiffs there could not foretell 10 when patients might enter their pharmacies and request Plan B, whenever that did happen, the 11 plaintiffs would refuse to sell the drug. See 586 F.3d at 1126 (“If a patient enters their pharmacies 12 requesting Plan B, which the record reflects has occurred, [plaintiffs] will refuse to deliver the 13 medication.”). Here, too, Plaintiffs will refuse service to pre-surgery transgender women if they 14 enter an Olympus Spa facility. And the complaint indicates that Plaintiffs have refused service to 15 patrons with male genitalia on several occasions (including the January 2020 Wilvich incident). 16 That Olympus Spa cannot tell the future with respect to prospective clientele does not render this 17 dispute unfit for judicial review. See 303 Creative, 6 F.4th at 1176 (although “the record would be 18 better developed, and the legal issues would be clearer, if Appellants had denied services to a 19 customer, that customer filed a complaint, and that complaint was adjudicated through the 20 appropriate administrative and judicial channels,” Article III does not require that). 21 The hardship prong is likewise met in this case. The WLAD and the Commission’s 22 application of that law to Olympus Spa “requires an immediate and significant change in plaintiffs’ 23 conduct of their affairs with serious penalties attached to noncompliance.” Tingley, 47 F.4th at 24 1070–71 (cleaned up). Olympus Spa has had to self-censor and forego its “biological women” ORDER GRANTING MOTION TO DISMISS - 25 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 26 of 40 1 policy under both the PFS agreement and threat of future enforcement. If it breaches the terms of 2 that agreement or otherwise violates the WLAD, it faces civil penalties. See id. at 1071 (application 3 of law to plaintiff required an immediate and significant change in his conduct because he was 4 forced to choose between refraining from desired speech and engaging in speech that risked costly 5 sanctions). In Thomas, the Ninth Circuit stated that hardship analysis “dovetails, in part, with the 6 constitutional consideration of injury.” 220 F.3d at 1142. And there “the absence of any real or 7 imminent threat of enforcement . . . seriously undermine[d] any claim of hardship.” Id. The court 8 was careful to emphasize several circumstances in that case: there were no “particular victims of 9 discrimination,” neither of the plaintiff landlords had been charged with violating the statutes at 10 issue, and, again, there was no reasonable or imminent threat of enforcement. Id. The opposite is 11 true in this case. Olympus Spa faces a credible threat of future enforcement, the Commission has 12 already enforced the WLAD against Olympus Spa for its “biological women” policy, and there is 13 at least one “particular” alleged victim of that policy. 14 Finally, the Court considers the hardship to the government from moving forward with this 15 case. Paxton, 26 F.4th at 1123. Even if Olympus Spa will suffer hardship from withholding judicial 16 consideration, “that hardship may still be insufficient to overcome the uncertainty of the legal issue 17 presented in the case in its current posture and thus fail to outweigh . . . the government’s interest 18 in delaying review.” Id. (cleaned up). Here, however, the Commission fails to persuade the Court 19 that judicial review will pose a hardship sufficient to justify prudential restraint. Indeed, and as 20 already discussed, further factual development is unnecessary to resolve the legal issue presented: 21 application of the WLAD to Olympus Spa’s “biological women” policy. The Commission passed 22 on that issue and there is no reason to delay review until the next complaint is issued. 23 24 ORDER GRANTING MOTION TO DISMISS - 26 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 27 of 40 1 B. Rule 12(b)(6) Motion to Dismiss 2 Dismissal under Rule 12(b)(6) may be based on either the lack of a cognizable legal theory 3 or the absence of sufficient facts alleged under a cognizable legal theory. Shroyer v. New Cingular 4 Wireless Servs., Inc., 622 F.3d 1035, 1041 (9th Cir. 2010). At this stage, the Court accepts as true 5 all factual allegations in the complaint and construes them in the light most favorable to the 6 nonmoving party. Gonzalez v. Google LLC, 2 F.4th 871, 885 (9th Cir. 2021). “To survive a motion 7 to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to 8 relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. 9 Corp. v. Twombly, 550 U.S. 544, 570 (2007)); see Fed. R. Civ. P. 8(a)(2) (a plaintiff must make a 10 “short and plain statement of the claim showing that the pleader is entitled to relief”). A claim is 11 facially plausible “when the plaintiff pleads factual content that allows the court to draw the 12 reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 13 678. 14 1. Free Exercise Claim (Count 1) 15 As for their first claim, Plaintiffs observe that they “have the liberty to not only believe as 16 they do about males and females in a state of undress, but they also have the right to freely exercise 17 their religious rights, i.e., to act in accordance with their faith-based convictions.” Dkt. No. 1 at 18 13. Plaintiffs allege that the Commission’s enforcement of the WLAD against them, “which 19 requires them to service nude males and females in the same rooms,” forces them “to choose 20 between violating the law or their religious convictions.” Id. at 14. This, according to Plaintiffs, 21 imposes a substantial burden on the exercise of their religious beliefs. Id. The Commission 22 counters that the WLAD is a neutral law of general applicability and therefore does not run afoul 23 of the First Amendment. See Dkt. No. 13 at 23–26. The Court agrees with the Commission and 24 dismisses this claim. ORDER GRANTING MOTION TO DISMISS - 27 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 28 of 40 1 The Free Exercise Clause of the First Amendment, applicable to the States under the 2 Fourteenth Amendment, states that “Congress shall make no law . . . prohibiting the free exercise” 3 of religion. U.S. Const. amend. I. This constitutional provision “protect[s] the ability of those who 4 hold religious beliefs of all kinds to live out their faiths in daily life through ‘the performance of 5 (or abstention from) physical acts.’” Kennedy v. Bremerton Sch. Dist., 142 S. Ct. 2407, 2421 6 (2022) (quoting Emp. Div., Dep’t of Hum. Res. of Or. v. Smith, 494 U.S. 872, 877 (1990)). 7 However, it does not exempt Olympus Spa from the WLAD. See Masterpiece Cakeshop, 138 S. 8 Ct. at 1727. The Supreme Court recently left intact Smith’s holding that “laws incidentally 9 burdening religion are ordinarily not subject to strict scrutiny under the Free Exercise Clause so 10 long as they are neutral and generally applicable.” Fulton v. City of Philadelphia, 141 S. Ct. 1868, 11 1876 (2021); see Smith, 494 U.S. at 878–79 (“We have never held that an individual’s religious 12 beliefs excuse him from compliance with an otherwise valid law prohibiting conduct that the State 13 is free to regulate.”). 14 Plaintiffs fail to plead—let alone plausibly—that the WLAD is anything but neutral. The 15 law does not discriminate on its face, and it does not by its terms favor a particular religion or the 16 non-exercise of religion. See Church of the Lukumi Babalu Aye, Inc. v. City of Hialeah, 508 U.S. 17 520, 533 (1993) (“To determine the object of a law, we must begin with its text, for the minimum 18 requirement of neutrality is that a law not discriminate on its face.”). Nor have Plaintiffs alleged 19 facts to suggest that the legislature was motivated by a masked intent to discourage religious 20 exercise or discriminate against their religion. See id. at 534, 540 (governmental hostility can be 21 “masked, as well as overt,” and the court may look to “the events leading to the enactment . . . in 22 question, and the legislative or administrative history, including contemporaneous statements 23 made by members of the decisionmaking body.”). Plaintiffs have also not alleged that the 24 Commission’s application of the WLAD in this case was motivated by any “clear and ORDER GRANTING MOTION TO DISMISS - 28 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 29 of 40 1 impermissible hostility toward the sincere religious beliefs that motivated [their] objection,” and 2 the Court is unable to discern any facts in the record that would support such a claim. Cf. 3 Masterpiece Cakeshop, Ltd., 138 S. Ct. at 1729. 4 Because the WLAD is neutral and generally applicable, the Court applies rational basis 5 review, meaning the law need only be rationally related to a legitimate governmental purpose to 6 survive constitutional scrutiny. See Stormans, 586 F.3d at 1137. 9 “Rational basis review is highly 7 deferential to the government, allowing any conceivable rational basis to suffice.” Erotic Serv. 8 Provider Legal Educ. & Rsch. Project v. Gascon, 880 F.3d 450, 457 (9th Cir. 2018). Plaintiffs thus 9 bear the burden of negating “every conceivable basis which might support” the WLAD. Fed. 10 Commc’ns Comm’n v. Beach Commc’ns, Inc., 508 U.S. 307, 315 (1993) (internal citation and 11 quotation omitted). This they cannot do. 12 The Court finds that the WLAD survives the “two-tiered inquiry” of rational basis review. 13 Gascon, 880 F.3d at 457. First, the WLAD has a legitimate purpose: “It is an exercise of the police 14 power of the state for the protection of the public welfare, health, and peace of the people of this 15 state, and in fulfillment of the provisions of the Constitution of this state concerning civil rights.” 16 Wash. Rev. Code § 49.60.010. Courts routinely find such purposes “compelling.” See, e.g., 17 Roberts v. U.S. Jaycees, 468 U.S. 609, 624 (1984) (Minnesota public accommodation law’s goals 18 of “eliminating discrimination and assuring its citizens equal access to publicly available goods 19 and services . . . plainly serves compelling state interests of the highest order.”); 303 Creative, 6 20 F.4th at 1178 (“Colorado has a compelling interest in protecting both the dignity interests of 21 members of marginalized groups and their material interests in accessing the commercial 22 9 23 24 Plaintiffs repeatedly argue that the WLAD substantially burdens their religion and is not narrowly tailored to achieve the state’s anti-discriminatory goals. See Dkt. No. 14 at 23–25. But the “narrowly tailored” requirement is a facet of strict scrutiny—the “most rigorous” level of constitutional review that does not apply here. See Lukumi Babalu Aye, 508 U.S. at 546. ORDER GRANTING MOTION TO DISMISS - 29 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 30 of 40 1 marketplace.”). And second, the WLAD promotes its purported purpose. The State “carries a light 2 burden” with respect to the second tier of the test, Gascon, 880 F.3d at 457, because “a legislative 3 choice is not subject to courtroom fact-finding and may be based on rational speculation 4 unsupported by evidence or empirical data,” Beach Commc’ns, 508 U.S. at 315. It is axiomatic 5 that the WLAD—which proscribes discrimination in places of public accommodation—advances 6 Washington’s “legitimate interest in ensuring equal access to public accommodation.” Arlene’s 7 Flowers, 441 P.3d at 1231. Plaintiffs’ free exercise claim therefore fails. 8 Plaintiffs attempt to raise a “hybrid rights” claim. In Smith, the Supreme Court excepted 9 from rational basis review “hybrid situation[s]”—those cases that involve “not the Free Exercise 10 Clause alone, but the Free Exercise Clause in conjunction with other constitutional protections, 11 such as freedom of speech and of the press[.]” 494 U.S. at 881–82. Plaintiffs accordingly wish to 12 tether their free exercise claim to “either or both” of their remaining claims in the hopes that the 13 Court will apply strict scrutiny to the WLAD. See Dkt. No. 14 at 25; see San Jose Christian Coll. 14 v. City of Morgan Hill, 360 F.3d 1024, 1031 (9th Cir. 2004) (“If . . . a law burdens the free exercise 15 of religion and some other constitutionally-protected activity, there is a First Amendment violation 16 unless the strict scrutiny test is satisfied[.]”). But a hybrid rights claim requires more than a bald 17 allegation that a companion right is implicated or has been violated. “[T]o assert a hybrid-rights 18 claim, a free exercise plaintiff must make out a colorable claim that a companion right has been 19 violated—that is, a fair probability or a likelihood, but not a certitude, of success on the merits.” 20 Miller v. Reed, 176 F.3d 1202, 1207 (9th Cir. 1999) (cleaned up). Put differently, a hybrid rights 21 claim is not entitled to strict scrutiny analysis merely because it “combine[s] a free exercise claim 22 with an utterly meritless claim of the violation of another alleged fundamental right[.]” Id. at 1208. 23 For the reasons discussed below, Plaintiffs fail to allege a plausible free speech or free association 24 ORDER GRANTING MOTION TO DISMISS - 30 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 31 of 40 1 violation. Neither of those claims, then, combines with their free exercise claim to create a viable 2 hybrid rights claim. The Court dismisses Plaintiffs’ free exercise claim. 3 2. Free Speech Claim (Count 2) 4 Plaintiffs contend that the Commission required Olympus Spa to “remove language from 5 its website that has a viewpoint that ‘biological women’ are females and distinct from males.” Dkt. 6 No. 1 at 14. More specifically, the Commission “forced Olympus Spa to ‘adopt new language on 7 its website reflecting a nondiscriminatory policy’ that affirms equal access, service, and treatment 8 for all customers ‘without regard to . . . sexual orientation or gender identity.’” Id. (quoting Dkt. 9 No. 1-3 at 36). 10 And because Olympus Spa “does not hold the view that transgender women are 10 female,” the new website language “compels speech about a moral issue [with] which the Plaintiffs 11 disagree.” Id.; see Dkt. No. 14 at 19 (“By requiring the Spa. . . to erase its message on the website 12 and change it to a government approved message, the State has abridged the speech rights of the 13 Spa.”). 11 14 The Commission defends its actions on two fronts. First, it argues that Olympus Spa’s 15 alteration of the website language cannot form the basis of a free speech challenge because the 16 alteration was a voluntary change pursuant to the PFS agreement. Dkt. No. 13 at 26. This is yet 17 another variation of the already rejected “invited injury” argument. That Olympus Spa agreed to 18 several terms (including self-censorship) to avoid formal prosecution is exactly the point, and the 19 Court need not rehash this issue any further. The Commission’s second argument is the winning 20 one. As it notes, the WLAD “does not control speech; it simply requires Plaintiffs, who have freely 21 22 23 24 10 Plaintiffs’ excerpt of the PFS agreement contains two errors. The agreement memorialized the fact that Olympus Spa had “adopted” new website language reflective of a “non-discriminatory” policy. Dkt. No. 1-3 at 36. 11 The Court was unable to identify the so-called “government approved” message anywhere in the record. Plaintiffs appear to have attached the original “biological women” policy to their Complaint, see Dkt. No. 1-3 at 13; presumably the “government approved” message simply refers to the deletion of that policy from the Spa’s website. ORDER GRANTING MOTION TO DISMISS - 31 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 32 of 40 1 chosen to offer their services to the public, to refrain from turning customers away because they 2 fall into a protected class.” Dkt. No. 15 at 9–10. 3 The First Amendment prohibits the enactment of laws “abridging the freedom of speech.” 4 U.S. Const. amend. I. Under the Free Speech Clause, the government “has no power to restrict 5 expression because of its message, its ideas, its subject matter, or its content.” Police Dep’t of 6 Chicago v. Mosley, 408 U.S. 92, 95 (1972). “Content-based laws—those that target speech based 7 on its communicative content—are presumptively unconstitutional and may be justified only if the 8 government proves that they are narrowly tailored to serve compelling state interests.” Reed v. 9 Town of Gilbert, 576 U.S. 155, 163 (2015). Laws that compel individuals to speak a particular 10 message are content-based. Nat’l Inst. of Fam. & Life Advocs. v. Becerra, 138 S. Ct. 2361, 2371 11 (2018); see also Hurley, 515 U.S. at 573 (“[O]ne important manifestation of the principle of free 12 speech is that one who chooses to speak may also decide ‘what not to say[.]’” (quoting Pac. Gas 13 & Elec. Co. v. Pub. Utilities Comm’n of Cal., 475 U.S. 1, 16 (1986))). 14 The law at issue here, however, is not a content-based speech restriction. The Commission 15 correctly observes that the WLAD does not target speech—indeed, it says nothing at all about 16 speech and does not purport to outlaw a particular idea, topic, message, or viewpoint. See Reed, 17 576 U.S. at 163 (a law is content-based if it “applies to particular speech because of the topic 18 discussed or the idea or message expressed”; the court considers whether the challenged 19 “regulation of speech ‘on its face’ draws distinctions based on the message a speaker conveys.” 20 (quoting Sorrell v. IMS Health Inc., 564 U.S. 552, 564 (2011))). The WLAD instead regulates 21 discriminatory conduct. 12 It “imposes a flat ban” on discrimination in places of public 22 12 23 24 Expressive conduct can of course be protected “speech” within the meaning of the First Amendment. See Texas v. Johnson, 491 U.S. 397, 404 (1989) (“The First Amendment literally forbids the abridgment only of ‘speech,’ but we have long recognized that its protection does not end at the spoken or written word.”). However, the conduct regulated by the WLAD—discriminatory exclusion of protected persons from places of public accommodation—is not the kind ORDER GRANTING MOTION TO DISMISS - 32 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 33 of 40 1 accommodation—“one that is applied without regard to [the] content” of a business’s message. 2 One World One Fam. Now v. City and Cnty. of Honolulu, 76 F.3d 1009, 1012 (9th Cir. 1996). And 3 as the Supreme Court has repeatedly observed, “[a] regulation that serves purposes unrelated to 4 the content of expression is deemed neutral, even if it has an incidental effect on some speakers or 5 messages but not others.” Ward v. Rock Against Racism, 491 U.S. 781, 791 (1989). 6 The compelled speech to which Olympus Spa points is “plainly incidental” to the WLAD’s 7 regulation of discriminatory conduct. FAIR, 547 U.S. at 62. The WLAD bars Olympus Spa from 8 denying services to customers based on sexual orientation and, in this regard, it incidentally 9 burdens Olympus Spa’s speech by prohibiting advertisement of discriminatory entrance policies 10 (e.g., one that permits only “biological women”). But that does not convert the WLAD into a 11 content-based regulation. To borrow an analogous example from the Supreme Court, “Congress . 12 . . can prohibit employers from discriminating in hiring on the basis of race,” and “that this will 13 require an employer to take down a sign reading ‘White Applicants Only’ hardly means that the 14 law should be analyzed as one regulating the employer’s speech rather than conduct.” Id.; see also 15 R.A.V. v. City of St. Paul, 505 U.S. 377, 389 (1992) (“[W]ords can in some circumstances violate 16 laws directed not against speech but against conduct[.]”); Giboney v. Empire Storage & Ice Co., 17 336 U.S. 490, 502 (1949) (“But it has never been deemed an abridgment of freedom of speech or 18 press to make a course of conduct illegal merely because the conduct was in part initiated, 19 evidenced, or carried out by means of language, either spoken, written, or printed.”); 303 Creative, 20 6 F.4th at 1183 (proposed statement on website, which expressed an intent to deny service based 21 on sexual orientation, was not protected by the First Amendment). 22 23 24 of “inherently expressive” conduct to which First Amendment protection extends. See FAIR, 547 U.S. at 65–66; Jaycees, 468 U.S. at 628 (“[L]ike violence or other types of potentially expressive activities that produce special harms distinct from their communicative impact, [discriminatory] practices are entitled to no constitutional protection.”). Nor does the WLAD “proscribe particular conduct because it has expressive elements.” Johnson, 491 U.S. at 406. ORDER GRANTING MOTION TO DISMISS - 33 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 34 of 40 1 This is critical for purposes of constitutional review because a facially neutral regulation 2 that incidentally burdens speech receives intermediate scrutiny. Such a law does not violate the 3 First Amendment “if it ‘furthers an important or substantial governmental interest; if the 4 governmental interest is unrelated to the suppression of free expression; and if the incidental 5 restriction on alleged First Amendment freedoms is no greater than is essential to the furtherance 6 of that interest.’” United States v. Albertini, 472 U.S. 675, 687–88 (1985) (quoting United States 7 v. O’Brien, 391 U.S. 367, 377 (1968)). The WLAD meets all three of these requirements. First, 8 the WLAD promotes an important—indeed, a “compelling”—state interest. See, e.g., Jaycees, 468 9 U.S. at 628 (“[A]cts of invidious discrimination in the distribution of publicly available goods, 10 services, and other advantages cause unique evils that government has a compelling interest to 11 prevent[.]”). Second, this compelling interest in protecting the public’s civil rights has nothing to 12 do with suppressing free expression. And third, the WLAD’s incidental restriction on speech is no 13 greater than is essential to the furtherance of that interest. 14 The final O’Brien requirement is met where, as here, the government’s interest “would be 15 achieved less effectively absent the regulation.” Albertini, 472 U.S. at 689. Why that is so needs 16 little elaboration. The public’s civil rights—and more specifically, equal access to public 17 accommodation—would be in dire jeopardy if businesses such as Olympus Spa could discriminate 18 and refuse services to individuals on account of “race, creed, color, national origin, citizenship or 19 immigration status, sex, honorably discharged veteran or military status, sexual orientation, or the 20 presence of any sensory, mental, or physical disability[.]” Wash. Rev. Code § 49.60.030(1). To be 21 sure, there may be other adequate means the legislature could use to accomplish this goal. But that 22 is not the test. Under O’Brien, the WLAD need only “add to the effectiveness” of the government’s 23 efforts to safeguard civil rights and ensure equal access to public accommodation. See FAIR, 547 24 U.S. at 67 (the issue was not whether “other means of raising an army and providing for a navy ORDER GRANTING MOTION TO DISMISS - 34 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 35 of 40 1 might be adequate”; it sufficed that Congress’s chosen means “add[ed] to the effectiveness of 2 military recruitment”); Albertini, 472 U.S. at 689 (“The validity of such regulations does not turn 3 on a judge’s agreement with the responsible decisionmaker concerning the most appropriate 4 method for promoting significant government interests.”). The WLAD is a content-neutral 5 regulation that does not run afoul of the Free Speech Clause. And the allegedly compelled speech 6 Plaintiffs take issue with is incidental to the WLAD’s regulation of discriminatory conduct. 7 Plaintiffs’ free speech claim is dismissed. 13 8 3. Free Association Claim (Count 3) 9 In their final claim, Plaintiffs allege that enforcement of the WLAD against them “would 10 require females . . . to remain in the presence of naked males” and therefore violates their “freedom 11 protected by the Bill of Rights to selectively enter into and carry on intimate or private 12 relationships—or refrain from such relationships.” Dkt. No. 1 at 15; see Dkt. No. 14 at 21–22 (“To 13 be exposed to the shocking and jarring visual of a penis while naked and to be viewed by someone 14 who could become turgid due to viewing the female form would be an extreme offense and 15 violative of the right to feel secure in one’s person and association.”). The Commission disagrees. 16 It contends that “the First Amendment does not protect the association between and among 17 [Olympus Spa’s] owners, staff, and customers.” Dkt. No. 13 at 28. Moreover, “Plaintiffs allege no 18 facts indicating that such relationships bear the characteristics of personal associations protected 19 by the First Amendment.” Id. 20 21 22 23 24 13 To the extent Plaintiffs seek nominal damages to redress their allegedly compelled speech, the Court agrees with the Commission that such damages are unavailable here. See Dkt. No. 13 at 14. It is well-settled law that state officials cannot be sued in their official capacities for damages under Section 1983. They may be sued for damages only in their individual capacities. See Arizonans for Off. English v. Arizona, 520 U.S. 43, 69 n.24 (1997). Plaintiffs, however, are suing Director Armstrong in her official capacity only. See Dkt. No. 1 at 1. ORDER GRANTING MOTION TO DISMISS - 35 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 36 of 40 1 The Supreme Court distinguishes between two constitutionally protected freedoms of 2 association: the “freedom of intimate association” 14 and the “freedom of expressive association.” 3 Jaycees, 468 U.S. at 617–18. The former involves the right “to enter into and maintain certain 4 intimate human relationships”—relationships which “must be secured against undue intrusion by 5 the State because of the role of such relationships in safeguarding the individual freedom that is 6 central to our constitutional scheme.” Id. at 617–18. The freedom of intimate association “receives 7 protection as a fundamental element of personal liberty.” Id. at 618. On the other hand, the freedom 8 of expressive association refers to the “right to associate for the purpose of engaging in those 9 activities protected by the First Amendment—speech, assembly, petition for the redress of 10 grievances, and the exercise of religion.” Id. It is viewed “as an indispensable means of preserving 11 other individual liberties.” Id. 12 Plaintiffs raise an intimate association claim. Although the “precise boundaries of this type 13 of constitutional protection” remain unmarked, the intimate relationships that have qualified for 14 the protection include “marriage; the begetting and bearing of children; child rearing and 15 education; and cohabitation with relatives.” Rotary Club of Duarte, 481 U.S. at 545 (internal 16 citations omitted). This is not to suggest that intimate association is restricted to family matters. 17 Id. Rather, qualifying relationships “are distinguished by such attributes as relative smallness, a 18 high degree of selectivity in decisions to begin and maintain the affiliation, and seclusion from 19 others in critical aspects of the relationship.” Jaycees, 468 U.S. at 620; Rotary Club of Duarte, 481 20 U.S. at 546 (“In determining whether a particular association is sufficiently personal or private to 21 warrant constitutional protection, we consider factors such as size, purpose, selectivity, and 22 whether others are excluded from critical aspects of the relationship.”). The Court must conduct a 23 14 24 The Supreme Court has also referred to this as the “freedom of private association.” Bd. of Dirs. of Rotary Int’l v. Rotary Club of Duarte, 481 U.S. 537, 547 (1987). ORDER GRANTING MOTION TO DISMISS - 36 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 37 of 40 1 “careful assessment” of the relationship’s characteristics to locate where it falls on a spectrum 2 “from the most intimate to the most attenuated of personal attachments.” Jaycees, 468 U.S. at 620; 3 see, e.g., Fair Hous. Council v. Roommate.com, LLC, 666 F.3d 1216, 1221 (9th Cir. 2012) (finding 4 that roommate relationship “easily qualifies” for protection because people “generally have very 5 few roommates; they are selective in choosing roommates; and non-roommates are excluded from 6 the critical aspects of the relationship[.]”). 7 The relationship between Olympus Spa and its customers clearly falls “outside of the 8 category of relationships worthy of this kind of constitutional protection.” Jaycees, 468 U.S. at 9 620. It is a business—not a private club with an exclusive membership. As such, Olympus Spa is 10 open to the public and provides services to countless (female) strangers on a daily basis. The 11 Supreme Court has for these reasons observed that “a large business enterprise” is the type of 12 association that “seems remote from the concerns giving rise to th[e] constitutional protection.” 13 Id. Although Olympus Spa may not constitute a large enterprise, the analogy is still apposite: spa- 14 goers “are not members of any organized association; they are patrons of the same business 15 establishment. Most are strangers to one another, and the [spa] admits all [biological females] who 16 are willing to pay[.]” City of Dallas v. Stanglin, 490 U.S. 19, 24–25 (1989) (activity of dancehall 17 patrons did not qualify as a form of intimate association). 18 Plaintiffs emphasize Olympus Spa’s female-only exclusivity and female-oriented purpose. 19 Dkt. No. 14 at 20. They likewise suggest that the business is sufficiently personal and private to 20 warrant constitutional protection because “the state of being unclothed requires the most intimate 21 of settings[.]” Id. at 21. But this again elides a basic, controlling fact: Olympus Spa is a business 22 that provides services to the public. See New York State Club Ass’n, Inc. v. City of New York, 487 23 U.S. 1, 12 (1988) (“It may well be that a considerable amount of private or intimate association 24 occurs in such a setting, as is also true in many restaurants and other places of public ORDER GRANTING MOTION TO DISMISS - 37 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 38 of 40 1 accommodation, but that fact alone does not afford the entity as a whole any constitutional 2 immunity to practice discrimination when the government has barred it from doing so.”). And as 3 was the case in Jaycees, Olympus Spa does not—“[a]part from . . . sex”—employ any criteria for 4 judging patrons, who are routinely “admitted with no inquiry into their backgrounds.” 468 U.S. at 5 621. Indeed, “much of the activity central to the formation and maintenance of the association 6 involves the participation of strangers to that relationship.” Id.; Rotary Club of Duarte, 481 U.S. 7 at 547 (many of organization’s “central activities” were “carried on in the presence of strangers”). 8 The Court does not minimize the privacy concerns at play when employees are performing 9 exfoliating massages on nude patrons. Aside from this nudity, though, there is simply nothing 10 private about the relationship between Olympus Spa, its employees, and the random strangers who 11 walk in the door seeking a massage. Nor is there anything selective about the association at issue 12 beyond Olympus Spa’s “biological women” policy. The Court therefore has little difficulty 13 concluding that the personal attachments implicated here are too attenuated to qualify for 14 constitutional protection. Plaintiffs’ intimate association claim is dismissed. 15 The Court therefore grants the Commission’s motion to dismiss. 16 4. 17 Plaintiffs ask for leave to amend their complaint “to add defendants in their individual 18 capacities” should the Court find that nominal damages are unavailable. Dkt. No. 14 at 27. The 19 Commission objects to this request. It argues that any such amendment would be futile “because 20 the individual defendants would be entitled to qualified immunity[.]” Dkt. No. 15 at 13. Given the 21 extremely lenient standard governing Rule 15(a)(2), the Court permits Plaintiffs an opportunity to Leave to Amend 22 23 24 ORDER GRANTING MOTION TO DISMISS - 38 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 39 of 40 1 amend their complaint. 15 2 “A party may amend its pleading with the court’s leave, which ‘[t]he court should freely 3 give . . . when justice so requires.’” Hoang v. Bank of Am., N.A., 910 F.3d 1096, 1102 (9th Cir. 4 2018) (alteration in original) (quoting Fed. R. Civ. P. 15(a)(2)). As the language of the rule 5 suggests, the standard for leave to amend is “very liberal.” AmerisourceBergen Corp. v. Dialysist 6 W., Inc., 465 F.3d 946, 951 (9th Cir. 2006); Morongo Band of Mission Indians v. Rose, 893 F.2d 7 1074, 1079 (9th Cir. 1990) (“[T]his policy is to be applied with extreme liberality.”). The Court 8 considers five factors when determining whether to grant leave to amend: (1) bad faith, (2) undue 9 delay, (3) prejudice to the opposing party, (4) futility of amendment, and (5) whether the party has 10 previously amended the complaint. Desertrain v. City of Los Angeles, 754 F.3d 1147, 1154 (9th 11 Cir. 2014). “The party opposing amendment bears the burden of showing why leave to amend 12 should not be granted.” Hedglin v. Swift Transp. Co. of Ariz., No. C16-5127-BHS, 2016 WL 13 8738685, at *1 (W.D. Wash. Nov. 15, 2016). 14 Leave to amend is appropriate here. As for the first three factors—bad faith, undue delay, 15 and prejudice to the opposing party—the Court discerns nothing in the record sufficient to 16 overcome Rule 15(a)’s presumption in favor of leave to amend. See Eminence Cap., LLC v. 17 Aspeon, Inc., 316 F.3d 1048, 1052 (9th Cir. 2003) (per curiam) (prejudice to the opposing party 18 “carries the greatest weight” and, absent prejudice or a “strong showing” under the other factors, 19 there is a presumption in favor of granting leave to amend). The Commission does not argue (and 20 thus has not shown) that Plaintiffs intend to amend their complaint in bad faith or that permitting 21 an amended complaint will result in undue delay. This case is also still in its earliest stages. The 22 15 23 24 Although Plaintiffs limit their request to the addition of defendants in their individual capacities, the Court addresses the propriety of leave to amend the complaint generally (i.e., in other respects) because such leave should be granted “even if no request . . . was made[.]” Cook, Perkiss & Liehe, Inc. v. N. Cal. Collection Serv. Inc., 911 F.2d 242, 247 (9th Cir. 1990). ORDER GRANTING MOTION TO DISMISS - 39 Case 2:22-cv-00340-BJR Document 21 Filed 06/05/23 Page 40 of 40 1 Court has not yet set a schedule, and there are therefore no impending deadlines or trial date. The 2 Court even vacated the initial scheduling deadlines pending resolution of the Commission motion 3 to dismiss. June 23, 2022 Docket Entry; see DCD Programs, Ltd. v. Leighton, 833 F.2d 183, 187– 4 88 (9th Cir. 1987) (granting leave to amend did not prejudice opposing party because the case was 5 “still at the discovery stage with no trial date pending”). 6 The fourth and fifth factors likewise favor leave to amend. The Ninth Circuit has repeatedly 7 emphasized that “[a] district court abuses its discretion by denying leave to amend unless 8 amendment would be futile or the plaintiff has failed to cure the complaint’s deficiencies despite 9 repeated opportunities.” AE ex rel. Hernandez v. Cnty. of Tulare, 666 F.3d 631, 636 (9th Cir. 10 2012); accord Heineke v. Santa Clara Univ., 812 F. App’x 644, 645 (9th Cir. 2020). The Court 11 cannot say that amendment is futile here. 12 The Court therefore grants Plaintiffs leave to amend their Complaint, without restricting 13 that leave to the specific grounds Plaintiffs have requested. Plaintiffs may file an amended 14 complaint adding new facts and claims, and may do so within 30 days of the date of this order. 15 Failure to do so will result in dismissal of the Complaint with prejudice. 16 III. CONCLUSION 17 For the reasons stated above, the Court GRANTS the Commission’s Motion to Dismiss, 18 without prejudice. Dkt. No. 13. Plaintiffs may file an amended complaint within 30 days of the 19 date of this Order. 20 Dated: June 5th, 2023. 21 _______________________________ Barbara Jacobs Rothstein U.S. District Court Judge 22 23 24 ORDER GRANTING MOTION TO DISMISS - 40
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