Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Gilbert v. United States Olympic Committee

United States District Court, D. Colorado

March 6, 2019

HEIDI GILBERT, AMBER MEANS, MANDY MELOON, GABRIELA JOSLIN, KAY POE, and JANE DOES 6-50, Plaintiffs,
v.
UNITED STATES OLYMPIC COMMITTEE, USA TAEKWONDO, INC., U.S. CENTER FOR SAFESPORT, STEVEN LOPEZ, JEAN LOPEZ, and JOHN DOES 1-5, Defendants.

          RECOMMENDATION OF UNITED STATES MAGISTRATE JUDGE

          Michael E. Hegarty, United States Magistrate Judge

         Plaintiffs assert twenty-one claims against the various Defendants. See Second Amended Complaint, ECF No. 68 (“SAC”). Defendants United States Olympic Committee (“USOC”), USA Taekwondo, Inc. (“USAT”), and Jean and Steven Lopez (collectively, the “Lopez Defendants”) have filed separate Motions to Dismiss seeking to dismiss the claims in their entirety. Additionally, the USOC moves under Fed.R.Civ.P. 12(f) to strike Plaintiffs' class action allegations.[1] As set forth below, I respectfully recommend that all motions be granted in part and denied in part.

         BACKGROUND

         Plaintiffs in this lawsuit are female taekwondo athletes who sought to compete for Team USA. Plaintiffs allege that during the time they participated and competed in the USAT system, they were sexually abused, assaulted, and raped by the Lopez Defendants, who Plaintiffs claim are prominent members of the United States taekwondo community. Plaintiffs' allegations in this lawsuit constitute three components. First, Plaintiffs allege coerced sexual conduct and sexual assault perpetrated by the Lopez Defendants. Second, Plaintiffs allege the USOC and USAT ignored and discredited their reports of such conduct in the years following the assaults. Finally, Plaintiffs allege that executives of the USOC and USAT lied to Congress in an attempt to divert blame and prevent institutional reform. In the interests of judicial economy and efficiency, many allegations from the 200-page SAC are omitted or significantly condensed in the following background section. Where those facts become relevant to resolution of the present motions, I discuss them at the appropriate juncture. Plaintiffs factual allegations are taken as true for analysis under Fed.R.Civ.P. 12(b)(6) pursuant to Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009).

         I. The Defendants

         Defendant USOC is the federally chartered institution that exercises “exclusive jurisdiction” over “all matters pertaining to United States participation in the Olympic Games, the Paralympic Games, and the Pan-American Games . . . .” 36 U.S.C. § 220503(3)(A). The USOC's jurisdiction includes the responsibility to “organize, finance, and control the representation of the United States in the competitions and events of the Olympic Games . . . .” § 220505(c)(3). Congress also empowered the USOC to “recognize eligible amateur sports organizations as national governing bodies [(“NGBs”)] for any sport that is included on the program of the Olympic Games . . . .” § 220505(c)(4).

         Defendant USAT is the NGB recognized by the USOC to govern the United States' participation in taekwondo. See SAC ¶ 98. Thus, USAT has the responsibility to select the athletes, officials, and coaches who will represent the United States in taekwondo in Olympic competitions. See Id. ¶ 95. Defendant Jean Lopez was the head coach of the USAT team at the 2004, 2008, 2012, and 2016 Olympics. Id. ¶ 139. Jean's brother, Defendant Steven Lopez, is a well-known athlete on the taekwondo team who won gold medals at the 2000 and 2004 games and a bronze medal in 2008. Id. ¶ 24. The two are part of a family that carries the moniker the “first family” of taekwondo. See Id. ¶¶ 23-25.

         Plaintiffs allege that during the time they participated in the USAT system, they were victims of sexual abuse, assault, and rape by Jean and Steven Lopez and by other members of the taekwondo community who are not defendants here. See Id. ¶¶ 362-722.

         II. Plaintiffs' Allegations of Sexual Assault

         A. Mandy Meloon

         Ms. Meloon was born in Germany in 1981. Id. ¶ 362. At the age of thirteen, she moved to the Olympic training center in Colorado Springs to train full-time in taekwondo. Id. ¶¶ 363- 67. Soon after moving to the center, she was befriended by Jean Lopez. Id. ¶¶ 368-69. Ms. Meloon asserts that Jean Lopez engaged in sexual conversations with her and referred to her as his girlfriend. Id. ¶ 370. She alleges that Danny Kim, an adult member of the taekwondo national team, raped Ms. Meloon in her room at the training center in 1996. Id. ¶ 391. For approximately another year, while Ms. Meloon was still living at the training center, Mr. Kim continued to have sex with Ms. Meloon. See Id. ¶¶ 392-97. Ms. Meloon made oral complaints about Mr. Kim in 1997 and a written complaint in 2006. Id. ¶ 398.

         In 1995, at the age of fourteen, Ms. Meloon made the USAT senior national team. Id. ¶ 375. She was still on that team in 1997 when it traveled to Cairo, Egypt, to compete in the World Cup. Id. ¶¶ 399-402. During the trip, Ms. Meloon shared a hotel room with Plaintiff Kay Poe. Id. ¶ 402. Ms. Meloon claims that, one night while both girls were asleep, Jean Lopez entered the girls' room, climbed into Ms. Meloon's bed, and digitally penetrated her vagina for approximately five minutes. Id. ¶¶ 404-07. Ms. Meloon pretended she was asleep during this assault. Id. ¶ 408.

         Ms. Meloon left the Olympic training center in 1998 and soon thereafter moved to Texas to train at Jean Lopez's gym. Id. ¶ 421. In 2000, when Ms. Meloon was eighteen, she began to have a sexual relationship with Steven Lopez. Id. ¶ 422. Ms. Meloon asserts that Steven soon became physically abusive. Id. ¶ 426. In 2002, he allegedly punched Ms. Meloon in the face. Id. ¶ 427. USOC and USAT officials “were aware” of this. Id. ¶ 428. Ms. Meloon also alleges that in 2004, Steven broke into her house, beat and raped her, then beat and raped her again in 2005. Id. ¶¶ 429-30. Later that year, at the World Championships in Madrid, Spain, Steven purportedly physically assaulted Ms. Meloon in their hotel, breaking her ribs. Id. ¶ 431. Ms. Meloon claims that, because she began to see other men after the Madrid incident, Coach Jean Lopez dropped Ms. Meloon from the national team. Id. ¶¶ 433-34.

         B. Kay Poe

         In 1996, at the age of fourteen, Ms. Poe became the youngest-ever member of the United States national taekwondo team. Id. ¶ 487. By 1997, Ms. Poe was having a sexual relationship with a twenty-two-year-old member of the team; the USOC allegedly had knowledge of this sexual relationship. Id. ¶¶ 491-93. Ms. Poe asserts that Jean Lopez “forced a sexual relationship” with her “while she was still a minor.” Id. ¶ 497. She also contends that, by 1999 when Ms. Poe was seventeen years old, Jean was having full sexual intercourse with her. Id. ¶¶ 498-502. This sexual relationship continued through the 2000 Olympic games in Sydney, when she was a competitor on the team and Jean was the coach. Id. ¶ 507. Ms. Poe asserts she was able to stop Jean from forcing sex on her shortly after those games. Id. ¶ 508. But at the 2002 U.S. Open, Ms. Poe alleges Jean followed her to her hotel room and “dry humped” her until he ejaculated in his pants. Id. ¶¶ 508-09. Ms. Poe left the sport of taekwondo after she failed to make the 2008 Olympic team. Id. ¶ 512.

         C. Heidi Gilbert

         Ms. Gilbert was a member of the USAT team at the 2002 Pan-Am Championships in Ecuador. Id. ¶ 523. She alleges that one night, while she was celebrating with Diana Lopez (the Lopez Defendants' sister) in Jean's hotel room, Jean entered the room and wrestled Ms. Gilbert onto the bed. Jean pinned her down and “dry humped” her until he ejaculated in his pants. Id. ¶¶ 528-34. A year later, after a competition in Germany, Ms. Gilbert and Jean (among others) attended a party. Id. ¶ 542. Ms. Gilbert claims that Jean was sexually aggressive with her by initiating physical contact and eventually gave her a drink that had been drugged. Id. ¶¶ 543-44. The drink caused her to “almost pass out, ” and she felt she could not move. Id. ¶¶ 545-46. She contends that Jean put her in a taxi, where he felt her breasts and vagina over her clothes. Id. ¶ 547. Ms. Gilbert also alleges that, when they reached the hotel, Jean dragged her to the back of a lobby area and digitally penetrated her and performed oral sex on her. Id. ¶¶ 548-51.

         D. Gabriela Joslin

         Ms. Joslin was born on March 14, 1983, and grew up in Texas. Pls.' Statement Non-Opp'n to Def. Jean & Steven Lopez's Req. Judicial Notice 2, ECF No. 122; SAC ¶ 602. She had known the Lopez brothers since she was a young child. SAC ¶ 603. Jean Lopez became her taekwondo coach in 2006. Id. ¶ 605. That same year, Ms. Joslin planned to compete in the German Open to gain experience to compete for the Olympic team but, at the last minute, Jean informed her that he would not travel to the competition. Id. ¶¶ 606-10. However, Steven Lopez was attending the event as a USAT athlete and coach and offered to serve as Ms. Joslin's coach. Id. ¶¶ 611-12.

         The night before Ms. Joslin's first match, Steven went to her hotel room and said he wanted to discuss her upcoming match. Id. ¶ 616. Ms. Joslin asserts that, once in the room, Steven turned on the television and changed the channel to a pornographic movie. Id. ¶ 617. He then grabbed Ms. Joslin, pinned her to the bed, and began rubbing her buttocks. Id. ¶¶ 618-19. Ms. Joslin states, “[i]t was clear to [her] that Steven required sex before he would address his responsibilities as coach.” Id. ¶ 620. The two then had sex, and Ms. Joslin continued to allow Steven to have sex with her for the remainder of her taekwondo career. Id. ¶¶ 621-22. She last had sex with Steven in 2010. Id. ¶ 624. She states she did this out of fear of Jean Lopez, who she alleges “made it clear . . . she was to cater to Steven.” Id. ¶ 622 (quotation omitted).

         After retiring as an athlete, Ms. Joslin began a career in Texas as a taekwondo coach. Id. ¶ 625. Around the same time, “Jean Lopez began a sexual relationship with her.” Id. ¶ 626. Ms. Joslin alleges that in late 2011, Jean violently raped her. Id. ¶ 630. She contends that she became pregnant by the rape and had an abortion. Id. ¶ 631.

         E. Amber Means

         Ms. Means was born on May 7, 1990, and grew up in Spokane, Washington. Pls.' Statement Non-Opp'n to Def. Jean & Steven Lopez's Req. Judicial Notice 2; SAC ¶ 655. She first met the Lopez Defendants at a taekwondo camp in Houston in 2003. SAC ¶ 656. After the camp, Jean Lopez told Ms. Means' parents she had tremendous potential in taekwondo. Id. ¶ 661. By 2004, Jean persuaded the Meanses to move to Texas so Amber could train at the Lopez' taekwondo studio. Id. ¶ 662. In 2007, when Ms. Means was 17, she and Steven Lopez began going on dates. Id. ¶ 675. Steven first kissed her after the two saw a movie that year. Id. ¶ 767. Ms. Means asserts that by 2008, when she was still seventeen, the two had started a sexual relationship, which they continued at competitions throughout 2008. Id. ¶¶ 685, 688. She alleges that in June 2008, Steven drugged and raped her at a private party. Id. ¶¶ 691-95.

         III. Reports of Sexual Assault

         Both Ms. Meloon and Ms. Gilbert allege they reported their allegations of sexual assault by Jean Lopez in approximately 2006 to 2008. Ms. Meloon alleges she personally handed her written complaint to executives at the USOC and USAT, including David Askinas, Chief Executive Officer (“CEO”) at USAT. Id. ¶¶ 189-91. She claims that Mr. Askinas later called Ms. Meloon's report of rape a “mischaracterization.” Id. ¶ 187.

         In 2006, Ms. Gilbert received a call from Mr. Askinas, asking whether she intended to file a complaint against Jean for his alleged rape in 2003. Id. ¶ 195. In 2008, Mr. Askinas allegedly told Ms. Meloon she could have a spot on the Olympic team, but she would have to withdraw her complaint against Jean and “sign a statement confessing that she was mentally ill and had fabricated her allegations . . . .” Id. ¶ 200. Ms. Meloon declined to retract her statement. Id. ¶ 201.

         In March 2015, USAT hired Donald Alperstein specifically to investigate allegations about the Lopez Defendants. Id. ¶ 269. USAT declared that Mr. Alperstein had “unfettered ability to carry out his task, ” and that any evidence he uncovered would be submitted to law enforcement agencies. Id. ¶ 219. However, Plaintiffs allege that the “USOC and USAT secretly worked together, behind closed doors, to make sure that the investigation against the Lopez brothers was delayed and obstructed, ” because the organizations wanted them to participate and compete in the 2016 Olympics. Id. ¶¶ 225-26. After the games concluded, Mr. Alperstein sent Ms. Gilbert an email stating, “Now that the Olympics are over and things are settling down, I want to get moving again on the Steven Lopez disciplinary case[.]” Id. ¶ 235 (alteration in original).

         IV. USOC's and USAT's Testimony before Congress

         Plaintiffs also allege that executives at the USOC and USAT have recently testified falsely before Congress. Plaintiffs allege Scott Blackmun, former USOC CEO, falsely testified that some NGBs have bigger budgets than the USOC, and he inaccurately stated the percentage of USOC's budget that is spent on overhead. Id. ¶ 171. Plaintiffs also allege Steve McNally, USAT Executive Director, testified before the Oversight and Investigations Subcommittee that Mr. Alperstein “operated without any limitation on its budget, with no control by USA Taekwondo as to who he should or should not pursue . . . .” Id. ¶ 220 (quoting Examining the Olympic Community's Ability to Protect Athletes from Sexual Abuse: Hearing Before the H. Subcomm. on Oversight and Investigations of the H. Comm. on Energy and Commerce, 115th Cong. 36 (2018) (statement of Steve McNally, Executive Director of USAT) (unofficial transcript). Plaintiffs allege these statements were false. Id. ¶ 220.

         V. Medals and Money

         Plaintiffs allege generally that the USOC and USAT sought to shield the Lopez Defendants, because the institutions were fixated on “medals and money.” Id. ¶ 6. In 2014, Mr. Blackmun purportedly stated, “For us, it's all about medals[, ]” and “[h]ow do we help American athletes get medals put around their necks? We have a line of sight between every decision we make and the impact on how many Americans will win medals.” Id. (alterations in original) (quoting Sally Jenkins, The USOC Needs a New Leader Who Cares About Athletes More Than Expense Accounts, Wash. Post (July 3, 2018)). Plaintiffs allege “[a]nything or anyone that gets in the way of the USOC's commercial quest for ‘medals and money' is silenced, obstructed, defamed, or intimidated into keeping quiet.” Id. ¶ 17.

         Plaintiffs characterize the Olympics as “big business.” Id. ¶ 103. The USOC has the exclusive rights to trademark everything related to the Olympics. Id. ¶ 109. It purportedly generates about $230 million per year, largely from marketing and sponsorships. Id. Thus, according to Plaintiffs, the USOC “generate[s] hundreds of millions of dollars of additional revenue off the backs and labor of the athletes who wear Team USA uniforms.” Id. ¶ 111. From this revenue, 129 USOC employees make six figure salaries. Id. ¶ 176. Plaintiffs allege, “Because the Lopez brothers were generating medals and money for the USOC and USAT, . . . the USOC purposefully chose to discredit [Ms. Meloon's reports of misconduct] and leave Jean and Steven Lopez in their positions, which would bring further revenue (money and medals) to the USOC.” Id. ¶ 192.

         LEGAL STANDARD

         “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Plausibility, in the context of a motion to dismiss, means that the plaintiff pled facts which allow “the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. Twombly requires a two-prong analysis. First, a court must identify “the allegations in the complaint that are not entitled to the assumption of truth, ” that is, those allegations that are legal conclusions, bare assertions, or merely conclusory. Id. at 678-80. Second, the Court must consider the factual allegations “to determine if they plausibly suggest an entitlement to relief.” Id. at 681. If the allegations state a plausible claim for relief, such claim survives the motion to dismiss. Id. at 680.

         Plausibility refers “to the scope of the allegations in a complaint: if they are so general that they encompass a wide swath of conduct, much of it innocent, then the plaintiffs have not nudged their claims across the line from conceivable to plausible.” SEC v. Shields, 744 F.3d 633, 640 (10th Cir. 2014) (quoting Khalik v. United Air Lines, 671 F.3d 1188, 1191 (10th Cir. 2012)). “The nature and specificity of the allegations required to state a plausible claim will vary based on context.” Safe Streets All. v. Hickenlooper, 859 F.3d 865, 878 (10th Cir. 2017) (quoting Kan. Penn Gaming, LLC v. Collins, 656 F.3d 1210, 1215 (10th Cir. 2011)). Thus, while the Rule 12(b)(6) standard does not require that a plaintiff establish a prima facie case in a complaint, the elements of each alleged cause of action may help to determine whether the plaintiff has set forth a plausible claim. Khalik, 671 F.3d at 1191.

         However, “[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice.” Iqbal, 556 U.S. at 678. The complaint must provide “more than labels and conclusions” or merely “a formulaic recitation of the elements of a cause of action, ” so that “courts ‘are not bound to accept as true a legal conclusion couched as a factual allegation.'” Twombly, 550 U.S. at 555 (quoting Papasan v. Allain, 478 U.S. 265, 286 (1986)). “Determining whether a complaint states a plausible claim for relief will . . . be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense.” Iqbal, 556 U.S. at 679. “[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, ” the complaint has made an allegation, “but it has not shown that the pleader is entitled to relief.” Id. (quotation marks and citation omitted).

         ANALYSIS

         Plaintiffs' SAC asserts twenty-one claims against the various Defendants. However, Plaintiffs have voluntarily withdrawn seven of those claims (claims 1-2, 6-7, 11-12, and 18) in the briefing for the present motions. See Resp. 3, ECF No. 139. Thus, fourteen claims remain, which fall into three broad categories: (1) claims by individual Plaintiffs under federal sex trafficking and forced labor laws; (2) a RICO claim; and (3) state law claims.

         Collectively, Defendants argue each claim should be dismissed, because the claim is barred by the statute of limitations, the Plaintiffs fail to plausibly state the claim, or both. See Lopez Defs.' Mot. Dismiss, ECF No. 106; USOC's Mot. Dismiss, ECF No. 108; USAT's Mot. Dismiss, ECF No. 109. Plaintiffs filed an omnibus Response on November 1, 2018, and the Defendants filed Replies to each motion on November 15, 2018. See ECF No. 139; USOC's Reply, ECF No. 155; Lopez Defs.' Reply, ECF No. 157; USAT's Reply, ECF No. 158.

         I. Alleged Violations of Federal Sex Trafficking and Forced Labor Law

         Plaintiffs bring the majority of their claims under the Trafficking Victims Protection Act (“TVPA”). Within these claims, the parties raise several disputes that are best resolved as preliminary matters. First, the parties vigorously dispute the statute of limitations that is applicable to the claims, since the TVPA (including its limitation provision) has been amended during the period in which the underlying sexual abuse has allegedly occurred. Second, the parties dispute the definitions of key terms in the TVPA. Specifically, the parties dispute whether the alleged sexual acts fall within the definition of “services” in 18 U.S.C. § 1589(a), and they disagree on the proper definition of “venture” in § 1589(b). The latter issue leads to the question of the elements necessary to state a claim under § 1589(b), which I will also address as a preliminary matter. After resolving these issues, I will address each claim individually.

         A. Preliminary Matters

         1. Applicable Statute of Limitations

         Plaintiffs and Defendants (particularly the Lopez Defendants) first dispute the applicable statute of limitations. The Lopez Defendants argue that the proper limitations period is that which existed at the time of the underlying conduct; in other words, since the TVPA carried a four-year statute of limitations in 2006, any claim for a TVPA violation regarding conduct that occurred on January 1, 2006 expired on January 1, 2010. Defendants contend that this result should persist even if Congress later added a longer limitations period.

         Plaintiffs counter that the applicable statute of limitations is found in the present amended statute, and any claim based on conduct that occurred within that limitations period is timely. However, Plaintiffs acknowledge this position contains an exception: if at any time a claim would have been barred under a previously existing limitations period, that claim would be barred.

         Most (but not all) of this dispute plays out in the context of Plaintiffs' TVPA claims. Congress originally passed the Victims of Trafficking and Violence Protection Act in 2000. Pub. L. No. 106-386, 114 Stat. 1464. This Act created only criminal penalties for conduct currently prohibited in 18 U.S.C. §§ 1589 and 1590. Trafficking Victims Protection Act § 112(a)(2), 114 Stat. at 1486-87. In 2003, Congress amended the Act to add a private right of action for victims of violations of §§ 1589, 1590, or 1591 at § 1595. Trafficking Victims Protection Reauthorization Act of 2003, Pub. L. No. 108-193 § 4(a)(4)(A), 117 Stat. 2875, 2878. At the time, the statute carried a four-year limitations period for filing civil actions. Cruz v. Maypa, 773 F.3d 138, 143- 44 (4th Cir. 2014) (citing 28 U.S.C. § 1658(a)). Congress amended the TVPA's limitations period to ten years on December 23, 2008. William Wilberforce Trafficking Victims Protection Reauthorization Act of 2008, Pub. L. No. 110-457 § 221(2)(B), 122 Stat. 5044, 5067.

         Defendants argue that since most of the alleged sexual abuse occurred when the statute carried a four-year limitations period (i.e., before December 23, 2008), any claim based on conduct that occurred during that time period has expired, because the SAC was filed in 2018, significantly more than four years after 2008. Plaintiffs respond that the existing ten-year statute of limitations applies, even to claims based on conduct that occurred when the TVPA carried a four-year limitations period, so long as a claim had never expired. Notably, if the ten-year period were to apply here, then claims based on conduct that occurred after May 4, 2008 (ten years before Plaintiffs filed the First Amended Complaint) are timely. However, because the ten-year limitations period did not commence until December 23, 2008, I must determine whether a claim based on conduct that occurred between May 4, 2008, and December 22, 2008, is timely.

         In Cruz, the Fourth Circuit addressed this precise question in the context of the TVPA amendments at issue here. The plaintiff in Cruz alleged that the defendant transported her from the Philippines to serve as a domestic employee at the defendant's residence, where he forced her to work grueling hours and isolated her from contacting her family. Id. at 141-43. Eventually, the plaintiff brought a lawsuit against the defendant for violations of the TVPA. Id. at 143-44. The conduct alleged by Cruz occurred at a time when the TVPA carried the four-year limitation period for filing a civil action. Id. at 143. But, by the time the plaintiff filed her suit, her claims would have been time barred if they were subject to the four-year limitation. See Id. (recounting that the district court dismissed the plaintiff's TVPA claims, because they were barred by the four-year statute of limitations). However, the plaintiff argued her claims were subject to the ten-year statute of limitations created by the 2008 amendment. Id. Ultimately, the Fourth Circuit held that the ten-year limitations period applied to claims that were unexpired at the time of the 2008 amendment, finding that its conclusion did not amount to imposing an impermissible retroactive effect. Id.

         In reaching its decision, the Fourth Circuit followed the Supreme Court's framework in Landgraf v. USI Film Products, 511 U.S. 244 (1994), for determining whether a statute applies retrospectively. See Cruz, 773 F.3d at 144-45. In Landgraf, the Court recognized that “the presumption against retroactive legislation is deeply rooted in our jurisprudence, ” 511 U.S. at 265, “but it also noted that ‘[a] statute does not operate “retrospectively” merely because it is applied in a case arising from conduct antedating the statute's enactment, '” Cruz, 773 F.3d at 144 (alteration in original) (quoting Landgraf, 511 U.S. at 269). Landgraf provides a three-step analysis to determine whether a statute applies to conduct that occurred prior to the enactment of the statute. First, a court must “determine whether Congress has expressly prescribed the statute's proper reach.” Landgraf, 511 U.S. at 280. If so, Congress' intent is given effect. Id. But second, if the statute does not contain such a command, “the court must determine whether the new statute would have retroactive effect, i.e., whether it would impair rights a party possessed when he acted, increase a party's liability for past conduct, or impose new duties with respect to transactions already completed.” Id. Third, if the statute would have retroactive effect, the Supreme Court's “traditional presumption teaches that it does not govern absent clear congressional intent favoring such a result.” Id.

         Here-as in Cruz-Congress has not expressly prescribed the current statute of limitation's proper reach, so I must determine whether applying it in this case would have retroactive effect. In Cruz, the court determined that it would not for two reasons. First, the court found that “applying a new limitations period to unexpired claims does not ‘attach[] new legal consequences to events completed before its enactment.'” Id. at 145 (alteration in original) (quoting Landgraf, 511 U.S. at 270). It found that, as long as a claim was unexpired at the time Congress extended the relevant statute of limitations, applying that statute “does not ‘increase a party's liability for past conduct[.]'” Id. (quoting Landgraf, 511 U.S. at 280). Second, the Fourth Circuit noted “in the criminal context, there is a consensus that extending a limitations period before prosecution is time-barred does not run afoul of the Ex Post Facto Clause of the Constitution.” Id. (collecting cases). I agree with the Fourth Circuit's analysis. Any of Plaintiffs' TVPA claims that were unexpired when Congress amended the Act to include a ten-year limitations period are timely to the extent they fall within ten years of the filing the First Amended Complaint. In this case, any claim based on conduct that occurred between May 4, 2008, and December 22, 2008 (the disputed period), was within the then-existing four-year limitations period when Congress amended the TVPA on December 23, 2008. As such, those claims were never expired and, therefore, they are timely asserted in this case. See also Owino v. CoreCivic, Inc., No. 17-CV-1112 JLS (NLS), 2018 WL 2193644, at *12 (S.D. Cal. May 14, 2018) (noting Cruz strongly supports the conclusion that the current ten-year statute of limitations applies to TVPA claims).

         The Lopez Defendants oppose this conclusion and cite to Abarca v. Little, 54 F.Supp.3d 1064 (D. Minn. 2014) for support. Lopez Defs.' Reply 4. To be sure, that court was presented with the same question and arrived at a different conclusion, but I am not persuaded by its reasoning. The court in Abarca decided against applying the ten-year limitations period to conduct that occurred before its enactment, concluding it “would have impermissible retroactive effect because it significantly broadens the basis for civil liability under the [TVPA].” 54 F.Supp.3d at 1069. However, if “significantly broadening the basis” for liability in the criminal context does not implicate retroactivity, I see no reason (and Abarca does not explain) why retroactivity would be implicated in the civil context. See Cruz, 773 F.3d at 145 (“[I]n the criminal context, there is a consensus that extending a limitations period before prosecution is time-barred does not run afoul of the Ex Post Facto Clause of the Constitution.”). More critically, the plaintiff in Abarca brought his claims under sections of the TVPA that, at the time of the conduct, only provided for criminal liability. See 54 F.Supp.3d at 1069 (“[The plaintiff] brings civil claims under [TVPA] provisions that previously only imposed criminal liability . . . .”). Thus, the court there correctly noted that “[r]etroactively applying the amendment would subject defendants to increased liability not contemplated when they engaged in the alleged conduct.” Id. Applying the civil remedy provision to conduct statutorily prohibited as “criminal” would certainly run afoul of Landgraf's prohibition on applying a statute that would “increase a party's liability for past conduct.” 511 U.S. at 280. Even so, the Abarca court's concern with “significantly broaden[ing] the basis for civil liability” suggests it may have ruled that applying the amended statute of limitations would have an impermissible retroactive effect, 54 F.Supp.3d at 1069, but I find the reasoning of the Fourth Circuit in Cruz more sound. Plaintiffs' TVPA claims that are within the present ten-year statute of limitations are timely asserted in this case. At the same time, Plaintiff's claims based on conduct that occurred outside the limitations period, as described here, are barred.

         2. Definition of “Services” in 18 U.S.C. §§ 1589(a), 1590(a)

         The parties also dispute whether coerced (but purportedly consensual) sexual acts fall within the definition of “labor” or “services” in the TVPA. Defendants argue that the sexual conduct alleged in the SAC does not fall within the statutory definition. The Lopez Defendants make this argument most clearly when they assert the “sexual services” alleged in the SAC are not within the “plain meaning” of the terms “labor” or “services” in 18 U.S.C. § 1589(a). See Lopez Defs.' Mot. Dismiss 9. But the Tenth Circuit has embraced definitions of those terms that are broader than the Lopez Defendants propose, in a context that is analogous to the allegations in the SAC.

         In United States v. Kaufman, 546 F.3d 1242 (10th Cir. 2008), federal prosecutors brought charges under § 1589 against a married couple who operated an “unlicensed group home for the mentally ill” and who persuaded, coerced, or forced the home's residents to perform a variety of bizarre sexually explicit acts. See Id. at 1246-50. For example, the couple forced the mentally ill patients to perform for pornographic videos. Id. at 1248. Other videos showed the husband touching the patients' genitals. Id. at 1249. At trial, the jury was given instructions that defined “labor” as “the expenditure of physical or mental effort” and “services” as “conduct or performance that assists or benefits someone or something.” Id. at 1260. The defendants appealed, objecting to these instructions and arguing that the statute applied only to “labor or services” that constitute “work in an economic sense.” Id. The Tenth Circuit rejected this argument.

         First, the court noted that the definitions used by the district court were “the ordinary meaning of those terms.” Id. at 1261 (citing 8 Oxford English Dictionary 559 (2d ed. 1989); 15 Oxford English Dictionary 34, 36 (2d ed. 1989)). Second, it found that the purpose of the TVPA is to “combat trafficking in persons, a contemporary manifestation of slavery whose victims are predominantly women and children, to ensure just and effective punishment of traffickers, and to protect their victims.” Id. (citing 22 U.S.C. § 7101(a)). Finally, the court drew upon the Fourth Circuit's decision in United States v. Udeozor, 515 F.3d 260, 266 (4th Cir. 2008), in which the court noted that sexual abuse has been “a badge and incident of servitude which is distressingly common, not just historically, but for young women who find themselves in coercive circumstances today.” The Tenth Circuit concluded this statement “suggests that sexual acts that have been coerced by other means are covered by the involuntary servitude statute.” Kaufman, 546 F.3d at 1262 (emphasis added).

         In this case, Plaintiffs allege the Lopez Defendants used their positions as influential members of USAT to coerce them to perform or submit to engaging in various sexual acts. SAC ¶ 708. The Plaintiffs all felt their ability to compete required a “pay-to-play, ” and they could not refuse the Lopez Defendants' requirements in “order to compete in USA Taekwondo and reach the Olympics.” Id. Ms. Joslin alleges, “out of fear of the Lopez brothers, ” she permitted Steven to have sex with her for the remainder of her taekwondo career after they first had sex when he offered to be her coach. Id. ¶¶ 620-24. Likewise, Ms. Means alleges she had sex with Steven Lopez in 2008 as they traveled to taekwondo events worldwide. Id. ¶ 688. “[S]exual acts that have been coerced by other means are covered by the involuntary servitude statute.” Kaufman, 546 F.3d at 1262. In light of Kaufman, I conclude that the pay-to-play sexual acts alleged in the SAC are “labor” or “services” as those terms exist in the TVPA.

         3. Definition of “Venture” in 18 U.S.C. § 1589(b)

         The parties next dispute the definition of the term “venture” in § 1589(b). This term also appears in § 1595(a), which provides the civil remedy that permits Plaintiffs to assert their claims in the SAC. Those two sections provide, respectively:

Whoever knowingly benefits, financially or by receiving anything of value, from participation in a venture which has engaged in the providing or obtaining of labor or services by any of the means described in subsection (a), knowing or in reckless disregard of the fact that the venture has engaged in the providing or obtaining of labor or services by any of such means, shall be punished as provided in subsection (d).

§ 1589(b) (emphasis added).

An individual who is a victim of a violation of this chapter may bring a civil action against the perpetrator (or whoever knowingly benefits, financially or by receiving anything of value from participation in a venture which that person knew or should have known has engaged in an act in violation of this chapter) in an appropriate district court of the United States and may recover damages and reasonable attorneys['] fees.

§ 1595(a) (emphasis added).

         I begin by addressing the definition the USOC encourages me to adopt. The USOC argues that “venture” is defined as a “sex trafficking venture.” USOC's Mot. Dismiss 9. To illustrate its position, the USOC modified Plaintiffs' allegation to incorporate its definition. See Id. (“Count 9 alleges that the USOC knew or recklessly disregarded ‘the fact that the [sex trafficking] venture was engaged in the providing or obtaining of Amber's labor or services by means of force.'”) (alteration added by the USOC) (quoting SAC ¶ 796).

         The USOC relies on two cases to support its argument that “venture” means “sex trafficking venture”: United States v. Afyare, 632 Fed.Appx. 272 (6th Cir. 2016) and Noble v. Weinstein, 335 F.Supp.3d 504 (S.D.N.Y. 2018), which relies on Afyare. At the outset, it is critical to note that both cases involve claims brought under § 1591, which also potentially creates liability against those who “participat[e] in a venture” when the venture is engaged in sex trafficking. See § 1591(a)(2). Neither case involves a claim under § 1589(b), and there are persuasive reasons to conclude (as at least one other court has) that the term “venture” is defined differently in § 1591(a)(2) than it is in § 1589(b).

         But I will first address the USOC's reliance on the holding in Afyare for its definition of “venture.” Section 1591 provides as follows:

(a) Whoever knowingly-
(1) in or affecting interstate or foreign commerce, or within the special maritime and territorial jurisdiction of the United States, recruits, entices, harbors, transports, provides, obtains, advertises, maintains, patronizes, or solicits by any means a person; or
(2) benefits, financially or by receiving anything of value, from participation in a venture which has engaged in an act described in violation of paragraph (1), knowing, or, except where the act constituting the violation of paragraph (1) is advertising, in reckless disregard of the fact, that means of force, threats of force, fraud, coercion described in subsection (e)(2), or any combination of such means will be used to cause the person to engage in a commercial sex act, or that the person has not attained the age of 18 years and will be caused to engage in a commercial sex act, shall be punished as provided in subsection (b).

§ 1591(a) (emphasis added). Notably, the term, “venture, ” is explicitly defined in § 1591(e)(6):

(e) In this section:
(6) The term “venture” means any group of two or more individuals associated in fact, whether or not a legal entity.

§ 1591(e)(6). Also of note, Congress appears to have confined this definition only to § 1591. See id. (“In this section . . . [t]he term ‘venture' means any group of two or more individuals associated in fact, whether or not a legal entity.” (emphasis added)). In fact, neither §§ 1589 nor 1595 define “venture.” In Afyare, the Sixth Circuit concluded that the appropriate definition of “venture” was not provided solely by § 1591(e)(6), or by the common definition of “venture” in Black's Law or Random House Webster's Unabridged dictionaries. 632 Fed.Appx. at 279, 284. Instead, the court concluded that “venture” in § 1591 is defined as a “sex-trafficking venture.” Id. at 285. To arrive at this definition, the court drew upon a principle of statutory interpretation that “when interpreting a statute, [a court will] ‘consider not only the bare meaning of the critical word or phrase but also its placement and purpose in the statutory scheme.'” Id. at 284 (quoting Holloway v. United States, 526 U.S. 1, 6 (1999)). Applying this principle, the Sixth Circuit concluded that it must consider not only the definition in § 1591(e)(6), but also the “context of § 1591(a)(2), which specifies ‘a venture which has engaged in an act described in violation of paragraph (1),' i.e., sex trafficking.” Id. at 284-85 (quoting § 1591(a)(2)). Thus, the court found “its ‘placement and purpose' in § 1591(a)(2) modify its ‘bare meaning' in § 1591(e)([6]), ” which led the court to conclude that the proper definition is limited to a “sex-trafficking venture.” Id.

         The USOC takes two approaches to incorporating Afyare's definition into this case. It first suggests “venture” in §§ 1589(b) and 1595(a) means a “sex-trafficking venture, ” just as the Afyare court held it does in § 1591. USOC's Mot. Dismiss 9. But I do not find this argument persuasive. The Afyare court's conclusion that “venture” in § 1591(a)(2) means “sex-trafficking venture” was founded on its “placement and purpose” in § 1591-the section creating liability for acts of sex trafficking. Here, Plaintiffs' claims are brought under § 1589, which does not prohibit sex trafficking. Rather, it creates liability for “[w]hoever knowingly provides or obtains the labor or services of a person” by certain enumerated means (discussed later in this Recommendation). § 1589(a). Thus, the Sixth Circuit's rationale for its definition of a “venture” in § 1591 cannot be reasonably applied to the definition in § 1589(b), which significantly differs from § 1591.

         The USOC's second approach, proposed only by inference, is to suggest that “venture” in § 1589(b) means a “forced labor venture.” See USOC's Reply 2 (“The theory of knowingly benefiting from participation in a forced labor venture also fails.” (emphasis added)). The USOC's logic for proposing this definition is self-apparent: since the Afyare court concluded “venture” in § 1591(a)(2) must mean “sex trafficking venture” due to its placement in a section that prohibits sex trafficking, 632 Fed.Appx. at 284-85, the term “venture” in a section prohibiting forced labor (among other things) must mean the “venture” in that section is defined as a “forced labor venture.” However, no court of which I am aware has endorsed this definition, and the USOC cites to none.

         Determining whether I should apply the USOC's proposed definition requires an analysis of § 1589(b). That subsection creates liability for “[w]hoever knowingly . . . benefits . . . from participation in a venture” which has obtained forced labor or services in violation of § 1589(a). § 1589(b). Under the USOC's definition, § 1589(b) creates liability only if a party knowingly benefits from participation in a forced labor (or presumably, forced services) venture. The USOC argues that “the element of ‘participation[]' . . . requires allegations of ‘specific conduct that further[s]' the purported forced labor venture.” USOC's Reply 3. It cites to four cases to support its position, but these cases are distinguishable in that they resolve claims under § 1589(a), which creates liability for the party that obtains forced labor or services, not § 1589(b), which creates liability for a party that knowingly participates in a venture.

         The USOC relies on the following cases: (1) Menocal v. GEO Group, Inc., 113 F.Supp.3d 1125 (D. Colo. 2015); (2) Owino v. CoreCivic, Inc., No. 17-CV-1112 JLS (NLS), 2018 WL 2193644 (S.D. Cal. May 14, 2018); (3) Adhikari v. Daoud & Partners, 697 F.Supp.2d 674 (S.D. Tex. 2009); and (4) Nunag-Tanedo v. East Baton Rouge Parish School Board, 790 F.Supp.2d 1134 (C.D. Cal. 2011). USOC's Reply 3. Two of these cases (Menocal and Nunag-Tanedo) do not involve claims brought under § 1589(b), but consider only claims for direct liability under § 1589(a). See Menocal, 113 F.Supp.3d at 1131-33; Nunag-Tanedo, 790 F.Supp.2d at 1143- 46. The other cases (Owino and Adhikari) include claims brought under § 1589(a) and the “knowingly benefit” provision, but neither court found it necessary to perform an analysis of the sufficiency of the pleadings solely under the “benefit from participation in a venture” provision. See Owino, 2018 WL 2193644, at *13 (stating that the plaintiffs “utilize” the benefit prong of § 1595(a)); Adhikari, 697 F.Supp.2d at 684-85 (concluding that the plaintiffs alleged the defendant “actively participated in and knowingly benefited from a venture that involved forced labor and trafficking”). The USOC proffers these opinions for support of its argument that, for it to be liable under § 1589(b), Plaintiffs must allege it engaged in conduct that would also make it liable as the principal under § 1589(a). USOC's Reply 3 (“The SAC includes no comparable allegations [to the four cited cases] as to the USOC.”). But this interpretation would render § 1589(b) redundant, and courts should not interpret a statute so as to make an entire provision redundant. Walters v. Metro. Educ. Enters., Inc., 519 U.S. 202, 209 (1997) (“Statutes must be interpreted, if possible, to give each word some operative effect.”); Kungys v. United States, 485 U.S. 759, 778 (1988) (noting the “cardinal rule of statutory interpretation that no provision should be construed to be entirely redundant”). I decline to adopt the USOC's proposed definition.

         When faced with interpreting a statutory term the legislature has not defined, the Tenth Circuit instructs that courts “begin by looking to the language of the statute and giv[ing] the words used ‘their ordinary meaning.'” U.S. v. Markey, 393 F.3d 1132, 1136 (10th Cir. 2004) (quoting United States v. Plotts, 347 F.3d 873, 876 (10th Cir. 2003)). Accordingly, I find it proper here to adopt the common definition of “venture.” Notably, in interpreting § 1589(b), at least one other court has adopted the definition of “venture” from Black's Law Dictionary: “‘an undertaking that involves risk,' and is typically associated with ‘a speculative commercial enterprise.'” Bistline v. Jeffs, No. 2:16-CV-788 TS, 2017 WL 108039, at *10 (D. Utah Jan. 11, 2017) (citing Black's Law Dictionary (10th ed. 2014)). In Bistline, the court concluded that an alleged relationship between a defendant and a law firm that provided the defendant legal services was insufficient to allege that a venture existed under § 1589(b). Id. at *9-10. In so concluding, the court found that “[n]either ‘participation' nor ‘venture' has been defined in the context of 18 U.S.C. § 1589(b).” Id. at *10. Interestingly, the court came to its conclusion after the Sixth Circuit decided Afyare, but neither adopted its definition nor cited to the case. Rather, in the absence of controlling law, the court resorted to the term's common definition as instructed by the Tenth Circuit.

         In this case, I am faced with a term that has not been defined by Congress or the Tenth Circuit and, thus, I will give the word its ordinary meaning: “[a]n undertaking that involves risk, ” especially “a speculative commercial enterprise.” Black's Law Dictionary (10th ed. 2014).

         4. Elements of a Civil Claim under 18 U.S.C.§§ 1589(b) & 1595(a)

         Intertwined with the question of the definition of “venture” in § 1589(b) is the question of the elements to state a claim under that subsection. To most effectively articulate my resolution of the question, I find it helpful to compare the provision to § 1589(a). Those two subsections provide in relevant part:

Whoever knowingly provides or obtains the labor or services of a person by any one of, or by any combination of, the following means-

§ 1589(a).

Whoever knowingly benefits, financially or by receiving anything of value, from participation in a venture which has engaged in the providing or obtaining of labor or services by any of the means described in subsection (a), knowing or in reckless disregard of the fact that the venture has engaged in the providing or obtaining of labor or services by any of such means, shall be punished as provided in subsection (d).

§ 1589(b).

         As I will discuss below, I find the following are the elements necessary to establish a violation of § 1589(b) of the TVPA:

(1) the party knowingly participated in a venture;
(2) the party knowingly benefitted from the venture;
(3) the venture has engaged in the providing or obtaining of labor or services in violation of the TVPA; and
(4) the party knew or recklessly disregarded the fact that the venture has engaged in the providing or obtaining of such labor or services.

         The simplest form of this claim would involve two individuals: Person A and Person B. These two people enter into a venture-a speculative commercial enterprise. The venture does well and Person A benefits financially from it. During this time, Person B uses the venture to obtain the services of Person C by threat of force, in violation of the TVPA. Person A knows of Person B's conduct. Nevertheless, Person A continues to participate in-and benefit from-the venture.

         At this point there are only two possible results from this example. Either Person A is already liable for violating § 1589(b)-and is civilly liable to Person C through § 1595-or he is not. If not, then some further conduct by Person A is necessary to be liable under the TVPA's forced labor statute.

         By the definition the USOC suggests, Person A is not liable under the scenario without some further conduct. The USOC would argue that Person A is not liable until he engages in “specific conduct that furthers” the forced labor aspect of the venture, which is required in subsection (a). USOC's Reply 3 (alteration omitted). To the extent he engages in such “specific conduct, ” he would be directly liable under § 1589(a), just as Menocal, Owino, Adhikari, and Nunag-Tanedo demonstrate. As I discussed above, I will not read § 1589(b) to be redundant of § 1589(a), and the elements of a § 1589(b) claim are those I just identified above.

         B. Plaintiffs' Claims

         Having addressed preliminary matters raised by the present motions, I now address Defendants' arguments that each claim fails under Rule 12(b)(6). For each claim, I will identify the time period in which such claim is available, if it is plausibly stated.

         1. Claim 3: Gabriela Joslin ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.