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Pliuskaitis v. USA Swimming, Inc.

United States District Court, D. Utah, Central Division

March 10, 2017

MICHAEL PLIUSKAITIS, an individual, Plaintiff,
v.
USA SWIMMING, INC. a foreign corporation, TERESA PLIUSKAITIS, an individual, Defendants.

          MEMORANDUM DECISION AND ORDER

          PAUL M. WARNER, CHIEF UNITED STATES MAGISTRATE JUDGE

         On May 27, 2015, all parties consented to having Chief United States Magistrate Judge Paul M. Warner conduct all proceedings in the case, including entry of final judgment, with appeal to the United States Court of Appeals for the Tenth Circuit.[1] See 28 U.S.C. § 636(c); Fed.R.Civ.P. 73. Before the court is USA Swimming, Inc.'s (“USA Swimming” or “Defendant”) motion to dismiss, or in the alternative, motion for summary judgment.[2] On October 8, 2015, the court held a hearing on the motion. At the hearing, Defendant was represented by Blaine J. Benard and Brent Rychener. Michael Pliuskaitis (“Plaintiff”) was represented by Aaron Gwilliam. Before the hearing, the court carefully considered the motion, memoranda, and other materials submitted by the parties. After considering the arguments of counsel and taking the motion under advisement, the court renders the following Memorandum Decision and Order.

         BACKGROUND

         This case involves Plaintiff; his former wife, Teresa Pliuskaitis (“Teresa”); and USA Swimming.[3] While Plaintiff and Teresa were married, Teresa owned Snowbird Aquatics, Inc. (“Snow”) in Virginia.[4] For part of their marriage, Plaintiff was the head coach of Snow and a coach member of USA Swimming.[5]

         USA Swimming is a service organization of at least 350, 000 members whose purpose is to promote the culture of swimming by creating opportunities for swimmers and coaches to participate and advance in the sport through clubs, events, and education.[6] USA Swimming is comprised of swimmers from age group level to the Olympic Team, as well as coaches and volunteers, with thousands of swimming clubs across the nation.[7]

         Through the Ted Stevens Olympic and Amateur Sports Act (“Sports Act”), 36 U.S.C. §§ 220501 to 220529, Congress created the United States Olympic Committee (“USOC”) to regulate amateur athletics and amateur sports organizations, including the Olympic and Pan-American Games. Shepherd v. U.S. Olympic Committee, 464 F.Supp.2d 1072, 1076 (D. Colo. 2006). Under the Sports Act, the USOC “exercise[s] exclusive jurisdiction, directly or through constituent members of committees, over . . . all matters pertaining to United States participation in the Olympic Games.” 36 U.S.C. § 220503(3)(A). In addition, the USOC is “to provide swift resolution of conflicts and disputes involving amateur athletics, national governing bodies, and amateur sports organizations, and protect the opportunity of any amateur athlete, coach, trainer, manager, administrator, or official to participate in amateur athletic competition.” Id. § 220503(8).

         The USOC is responsible for selecting a National Governing Body (“NGB”) for each amateur sport. Id. § 220521(a). The USOC recognizes USA Swimming as the NGB for the sport of swimming in the United States.[8] As the NGB for swimming, USA Swimming has various obligations under the Sports Act. For instance, USA Swimming must provide “fair notice and opportunity for a hearing” to any amateur athlete or coach before declaring an individual ineligible to participate in amateur athletic competition. Id. § 220522(a)(8). Pursuant to the Sports Act, USA Swimming promulgated Rules and Regulations that set forth its process and rules for resolving complaints involving its members.

         In January 2012, during the pendency of Plaintiff and Teresa's divorce, Plaintiff alleges that Teresa sent an anonymous report to USA Swimming informing the organization that Plaintiff had engaged in an inappropriate sexual relationship with a minor athlete (“V.M.”).[9]V.M. was fourteen years old when she began swimming with Snow in 2006, and she began collegiate swimming at the University of Utah in August 2010.[10]

         Based upon Teresa's report, USA Swimming filed a Petition with the National Board of Review (“NBOR”) alleging that Plaintiff had violated various sections of USA Swimming Code of Conduct (“Code”).[11] On June 19, 2012, the NBOR issued a Notice of Hearing (“Notice”) for determining whether Plaintiff's membership in USA Swimming should be revoked.[12] The Notice set forth the following sections of the Code Plaintiff allegedly violated: (1) Section 304.3.7 of the 2010 and 2011 Codes, (2) Section 304.3.4 of the 2012 Code, (3) Section 304.3.8 of the 2012 Code, and (4) Section 305.1 of the 2012 Code.[13] Each of these Codes strictly prohibits any sexual conduct, advances, or behavior directed toward an athlete by a coach member.[14]

         The NBOR conducted an evidentiary hearing on August 1, 2012.[15] On August 6, 2012, the NBOR issued its ruling and found that Plaintiff had violated sections 304.3.6 and 304.3.18 of the Code with respect to his relationship with V.M. from 2010 through May 2012.[16] Based on this ruling, Plaintiff was permanently banned from membership in USA Swimming.[17]

         On September 4, 2012, Plaintiff appealed that decision to the Board of Directors of USA Swimming.[18] The Board of Directors affirmed the NBOR's decision in its entirety on February 11, 2013.[19] The Board of Directors stated that the NBOR had found that Plaintiff violated Section 304.3.8 of the 2012 Code and Section 305.1 of the 2012 Athlete Protection Policies.[20] On February 15, 2013, USA Swimming posted Plaintiff's name on the Individuals Permanently Suspended or Ineligible List, known as the “Banned for Life List” on its website.[21] Next to each individual's name is a hyperlinked citation to the Code Sections that were allegedly violated.[22]Next to Plaintiff's name, USA Swimming published citations to Sections 304.3.5 of the 2010 Code of Conduct, 304.3.7 of the 2011 Code, 304.3.4 of the 2011 Code, and 304.3.8 of the 2012 Code.[23] While Section 304.3.7 of the 2010 Code concerns the use of illegal drugs in the presence of an athlete by a coach, USA Swimming did not make that allegation in its petition or to the NGB.[24] USA Swimming has acknowledged that there was a clerical mistake with regard to the specific Code provisions listed on its website.[25]

         Plaintiff then filed an initial Demand for Arbitration dated July 22, 2013, and an Amended Demand for Arbitration dated January 10, 2014.[26] In both his initial and amended arbitration demands, Plaintiff asserted that the decisions by the NBOR and the Board of Directors banning him for life was arbitrary or capricious and violated concepts of fundamental fairness.[27] Plaintiff requested an order reinstating his membership in USA Swimming and lifting the ban imposed by USA Swimming, as well as an award of $75, 000 in compensatory damages for “lost income, loss of reputation, and emotional distress.”[28]

         The arbitration hearing took place on March 6-7, 2014.[29] On March 26, 2014, the Arbitrator issued a decision in which she concluded that the NBOR's determination that Plaintiff violated the 2010 and 2011 Code Sections prohibiting sexual conduct between coaches and athletes was arbitrary and capricious.[30] The Arbitrator noted that while Plaintiff had hugged and kissed V.M. in 2011, these actions do not constitute sexual conduct.[31] The Arbitrator further concluded that the NBOR's determination that conduct occurring between Plaintiff and V.M. in 2012 violated the Code was likewise arbitrary and capricious: in 2012, V.M. was no longer a member of USA Swimming and Plaintiff was not a coach member with respect to her.[32] The Arbitrator ordered USA Swimming “to remove [Plaintiff] from the banned list and to reinstate [him] to membership in the organization, ” and she required USA Swimming to pay the arbitration filing fees and expenses.[33] The Arbitrator also denied Plaintiff's claim for compensatory damages, explicitly stating: “This Award is in full settlement of all claims submitted to this Arbitration. All claims not expressly granted herein, including any claim for damages, are hereby denied.”[34]

         On March 27, 2014, USA Swimming removed Plaintiff's name from its list of permanently banned individuals on its website.[35] Pursuant to Federal Arbitration Act, 9 U.S.C. § 12, an application to vacate or modify the award must have been filed no later than June 2014 (within three months from the date the award was delivered). Neither Plaintiff nor USA Swimming sought judicial review or modification of the Arbitrator's decision.

         In his Amended Complaint, Plaintiff asserts the following six claims against USA Swimming: defamation, breach of duty, violation of Sports Act, breach of contract, breach of good faith and fair dealing, and tortious interference.[36] As to the claim for defamation, Plaintiff contends that USA Swimming's actions in placing him on the banned for life list, including the citations to incorrect Code Sections, has hurt his reputation.[37] Plaintiff's other causes of action against USA Swimming rest on allegations that the NBOR hearing process violated USA Swimming's Rules and Regulations, USOC's Bylaws, and/or the Sports Act.[38]

         In response to Plaintiff's lawsuit, USA Swimming filed the instant motion to dismiss and, in the alternative, a motion for summary judgment.[39] USA Swimming argues that Plaintiff's amended complaint should be dismissed under Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure because Plaintiff's claims for relief are preempted by the Sports Act and were already adjudicated in binding arbitration.[40] USA Swimming also contends that Plaintiff's defamation claim was filed outside the applicable statute of limitations.[41]

         STANDARD OF REVIEW

         USA Swimming moves this court to dismiss Plaintiff's complaint under Rules 12(b)(1) and 12(b)(6) or, in the alternative, under Rule 56(c). However, because the court resolves USA Swimming's motion to dismiss under Rules 12(b)(1) and 12(b)(6), it is unnecessary for the court to address its alternative motion for summary judgment.

         Under Rule 12(b)(1), the court may dismiss a claim for lack of subject matter jurisdiction. “Subject-matter jurisdiction involves a court's authority to hear a given type of case” and the party invoking federal jurisdiction bears the burden of establishing that the court has subject matter jurisdiction. Radil v. Sanborn W. Camps, Inc., 384 F.3d 1220, 1224 (10th Cir. 2004). Federal courts, unlike state courts, are courts of limited jurisdiction, possessing only that power authorized by the Constitution and by statute. Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994).

         Motions to dismiss pursuant to Rule 12(b)(1) take two forms. First, a party may attack the complaint facially. Holt v. United States, 46 F.3d 1000, 1002 (10th Cir. 1995). “In reviewing a facial attack on the complaint, a district court must accept the allegations in the complaint as true.” Id. (citations omitted). Second, a party may look beyond the complaint and challenge the factual basis upon which the plaintiff seeks to assert the court's subject matter jurisdiction. Id. at 1003. “When reviewing a factual attack on subject matter jurisdiction, a district court may not presume the truthfulness of the complaint's factual allegations.” Id. A court may consider affidavits and other documents to ascertain whether it has subject matter jurisdiction without converting the motion to one for summary judgment under Rule 56 of the Federal Rules of Civil Procedure. Los Alamos Study Grp. v. U.S. Dep't of Energy, 692 F.3d 1057, 1063 (10th Cir. 2012) (“[W]hen considering a Rule 12(b)(1) motion to dismiss, a court may weigh the evidence and make factual findings.”).

         To survive a motion to dismiss under Rule 12(b)(6), “a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim for 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)). A court should “assume the factual allegations are true and ask whether it is plausible that the plaintiff is entitled to relief.” Gallagher v. Shelton, 587 F.3d 1063, 1068 (10th Cir. 2009). “The court's function on a Rule 12(b)(6) motion is not to weigh potential evidence that the parties might present at trial, but to assess whether the plaintiff's complaint alone is legally sufficient to state a claim for which relief may be granted.” Miller v. Glanz, 948 F.2d 1562, 1565 (10th Cir. 1991). Thus, “the complaint must give the court reason to believe that this plaintiff has reasonable likelihood of mustering factual support for these claims.” Ridge at Red Hawk, LLC v. Schneider, 493 F.3d 1174, 1177 (10th Cir. 2007). “In evaluating a Rule 12(b)(6) motion to dismiss, a courts may consider not only the Complaint itself, but also attached exhibits, and documents incorporated into the Complaint by reference.” Smith v. United States, 561 F.3d 1090, 1098 (10th Cir. 2009) (citations omitted).

         DISCUSSION

         USA Swimming argues that Plaintiff's claims are barred under the Sports Act on the grounds that (1) USA Swimming created extensive dispute resolution procedures for the grievances of its members as required of all NGBs by the Sports Act; (2) there is no private right of action under the Sports Act; and (3) the Sports Act preempts state-law claims related to eligibility. Alternatively, USA Swimming argues that Plaintiff's claims are subject to dismissal under res judicata and that the applicable statute of limitations bars Plaintiff's defamation claim.

         In response, while Plaintiff recognizes that the Sports Act gives USA Swimming exclusive authority over the resolution of grievances regarding the eligibility of its members, Plaintiff contends that his state claims do not pertain to his eligibility, nor do they concern the United States' participation in the Olympics, Paralympics, or Pan-American Games. Plaintiff further argues that USA Swimming failed to follow its own rules in determining his eligibility, and, as such, the Sports Act does not preempt his state-law claims against USA Swimming. He also asserts that because he could not bring all of his claims in arbitration, res judicata does not apply. Lastly, Plaintiff contends that he timely filed his defamation claim and therefore it is not barred by the statute of limitations. The court will address each of the parties' arguments in turn.

         I. Rule 12(b)(1) Motion to Dismiss

         A. Sports Act

         Through the Sports Act, Congress granted the USOC and its NGBs exclusive jurisdiction “over . . . all matters pertaining to United States participation in the Olympic Games.” 36 U.S.C. § 220503(3)(A). As part of that exclusive authority, USOC is required “to provide swift resolution of conflicts and disputes involving amateur athletics, national governing bodies, and amateur sports organizations, and protect the opportunity of any amateur athlete, coach, trainer, manager, administrator, or official to participate in amateur athletic competition.” Id. § 220503(8).

         While the Sports Act specifically provides that the USOC (and thus its NGBs like USA Swimming) may sue and be sued in federal court, it also expressly negates the establishment of a private right of action. Id. § 220505(b)(9) (“[N]either this paragraph nor any other provision of [the Sports Act] shall create a private right of action under this chapter . . . .”). Thus, as noted in Lee v. U.S. Taekwondo Union, 331 F.Supp.2d 1252 (D. Haw. 2004), “the USOC may be sued only with respect to matters not arising under the Amateur Sports Act, such as, for example, with respect to a dispute over a lease that the USOC may have signed with the landlord of its offices.” Id. at 1257. Accordingly, the question is whether Plaintiff's claims against USA Swimming arise under the Sports Act.

         In Slaney v. International Amateur Athletic Federation, 244 F.3d 580 (7th Cir. 2001), the plaintiff, athlete Mary Decker Slaney, had tested positive for a prohibited substance after participating in the Olympic track and field trials. Id. at 586. After exhausting her administrative remedies, Slaney filed suit in federal court claiming that she suffered damages by the “unlawful manner in which the USOC conducts its doping program.” Id. at 596. The Seventh Circuit, however, affirmed the dismissal of Slaney's state-law claims for lack of subject matter jurisdiction. Id. In particular, the court stated, “Slaney cannot escape the fact that her state-law claims, whether framed as breach of contract, negligence, breach of fiduciary duty, fraud, constructive fraud, or negligent misrepresentation, are actually challenges to the method by which the USOC determines eligibility of athletes, ” and thus are preempted by the Sports Act. Id. Additionally, the court noted that Slaney's complaint avoided “any mention of the fact that her damages arise from the USOC's determination regarding her eligibility, ” which the court assumed was Slaney's tacit acknowledgment that the USOC has exclusive jurisdiction to determine all eligibility matters, including those set forth in her state-law claims. Id.

         Similarly, in Cantrell v. United States Soccer Federation, 924 P.2d 789 (Okla. App. 1996), a suspended youth soccer coach alleged that the NGB for the sport of soccer conducted a hearing in violation of its rules and regulations. Id. at 790. Cantrell brought claims for breach of contract and tortious interference with rights. Id. In affirming the trial court's dismissal of his action, the court stated: “Although Cantrell purports to assert his claims in tort, it is clear from reading his Petition as a whole that he effectively seeks a further appeal of the administrative determinations made by Appellees ...


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