Wallace v. John Stewart Company

Background

David Wallace, a pro se (self-represented) plaintiff who describes himself as a 73-year-old individual with PTSD, ADD, Schizotypal Personality Disorder, and other cognitive and neurological impairments, filed this lawsuit against The John Stewart Company ("JSC") and Redwood Gardens ("RG"), among others, arising from his attempts to obtain housing at Redwood Gardens. Wallace applied for housing in 2019, was placed on a high-priority waiting list in July 2020, was disqualified around June 2023 based on a disputed income determination, and reapplied on February 7, 2025. He alleges defendants obstructed his reinstatement, failed to place him on a one-bedroom waiting list despite prior representations, and refused reasonable accommodations for his disabilities.

Procedural History

This case has a lengthy procedural history marked by repeated amendments. The case was originally filed May 23, 2025. Judge Cisneros initially granted Wallace in forma pauperis (fee-waiver) status but found the original complaint insufficient. After a First Amended Complaint passed initial screening, the case was reassigned to Judge Orrick on July 31, 2025. Wallace's subsequent attempts to amend repeatedly violated court orders — he added defendants without authorization, failed to comply with formatting rules, and added claims expressly forbidden by prior orders. By May 12, 2026, the court had dismissed the Third Amended Complaint ("TAC"), granting leave to amend on most claims but dismissing the retaliation count without leave to amend and explicitly ordering Wallace not to add new claims or parties.

Wallace filed a Fourth Amended Complaint ("FAC") on May 26, 2026. JSC moved to dismiss. Wallace opposed, and JSC replied.

Legal Standards

The court applied two overlapping standards. Under Federal Rule of Civil Procedure 12(b)(6), a complaint must allege facts sufficient to make a claim "plausible on its face" — meaning more than a speculative possibility that a defendant acted unlawfully. Under 28 U.S.C. § 1915(e)(2)(B), which applies because Wallace was granted fee-waiver status, the court must screen complaints and dismiss those that fail to state a viable claim. The standard is the same under both provisions. For pro se plaintiffs, courts construe pleadings liberally, but cannot supply missing essential elements of a claim.

Rulings

Individual Defendants — Dismissed

Wallace named roughly twenty individual defendants, many of whom had already been dismissed by prior court order. The court dismissed every individual defendant, finding that to the extent any factual allegations were made against them, they were simply acting within the scope of their employment, and that the employers (the corporate defendants) would be liable if the claims succeed. The court stated that requiring service on individuals would serve no purpose other than harassment, burden, inefficiency, and expense. Individual defendants are dismissed and may not be re-named in any future complaint.

Corporate Defendants Other Than JSC and RG — Dismissed

Wallace named numerous corporate defendants. The court found that only JSC and RG potentially face plausible claims. Because Wallace used the collective term "defendants" without specifying which company did what, the court could not parse which entity was liable for which conduct. All corporate defendants other than JSC and RG are dismissed and may not be re-named.

Counts III and IV (New Claims) — Granted (Dismissed)

Wallace added two claims not present in the TAC: violations of Section 504 of the Rehabilitation Act (29 U.S.C. § 794) and HUD Regulations and Handbook Violations. The court's prior order had expressly forbidden adding new claims. The court granted JSC's motion to dismiss as to these counts, and instructed Wallace not to re-raise them in any future complaint.

Count I — Fair Housing Act — Granted (Dismissed)

The Fair Housing Act (FHA) requires private lawsuits to be filed within two years of the discriminatory housing practice. Because Wallace filed on May 23, 2025, only conduct on or after May 23, 2023, is within the limitations period. Wallace argued for the "continuing violation" doctrine, which can extend the limitations period when unlawful conduct continues into the limitations window — not merely when the effects of past conduct persist. The court, applying the Ninth Circuit's decision in Garcia v. Brockway, 526 F.3d 456 (9th Cir. 2008), rejected the continuing violation argument as to conduct before 2023, finding that Wallace confused the continuing effects of a prior violation with an actual continuing violation.

The court noted that Wallace's February 2025 reapplication and the alleged failure to communicate with him through approximately July 2025 fall within the limitations period and could potentially support a claim — but found that his current FHA allegations are too conclusory. He must allege who discriminated against him, how, and in what ways he was treated differently from similarly situated applicants. The motion to dismiss Count I was granted.

Count II — Americans with Disabilities Act — Granted (Dismissed)

Title II of the ADA does not have its own statute of limitations; courts borrow the limitations period from the most analogous state claim. The Ninth Circuit has recognized California Government Code § 11135 as the state-law counterpart to Title II, resulting in a three-year limitations period. For a complaint filed May 23, 2025, only conduct on or after May 23, 2022, is timely.

Wallace alleged that on April 23, 2025, he emailed housing management identifying six disabilities and requesting reasonable accommodations, and that defendants failed to engage in the required "interactive process" and discriminated against him on the basis of disability. The court found these allegations conclusory. To state a claim, Wallace must specify what accommodations he requested, from whom, whether JSC acknowledged or denied the request, and how JSC's actions constituted disability discrimination. The motion to dismiss the ADA claim was granted.

Leave to Amend

Despite granting the motion to dismiss in full, the court gave Wallace one final opportunity to file a Fifth Amended Complaint by September 28, 2026. The amended complaint must: (1) name only JSC and RG as defendants; (2) raise only Fair Housing Act and ADA claims; (3) allege specific facts within the applicable statutes of limitations; and (4) explain separately what each defendant did and why it was unlawful. The court stated it will not provide another chance to amend after this.

The court will screen the Fifth Amended Complaint; if it states a colorable claim, JSC will have 30 days to respond, after which the court will allow 90 days for discovery and set a trial date.