Boyd v. Kilpatrick Townsend & Stockton, LLP

UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF COLUMBIA

JOHN W. BOYD, JR.,

Plaintiff,

Civil Case No. 14—00889 (RJL)

FILED

resuszms

Clerk, U.S. District & Bankruptcy

Courts tor the Districth Columbia

V.

KILPATRICK TOWNSEND

& STOCKTON, LLP et al.,

Defendants.

EVVVVVVVVVV

MEMORANDUM ORDER

(February§_, 2015) [Dkt. ##7, 11, 13]

Before the Court are three motions. The first two motions, filed by defendants

Dennis Gingold (“defendant Gingold") and Kilpatrick. Townsend & Stockton LLP

(“defendant Kilpatrick”), request dismissal under Federal Rule of Civil Procedure

12(b)(6) for failure to state a claim and Rule 12(b)(1) for lack of standing. See [Dkts #7,

1 1]. The third motion, filed by plaintiff John W. Boyd Jr. (“Boyd” or “plaintiff”), argues

that the Court lacks subject matter jurisdiction and requests that this action be remanded

to the DC. Superior Court. See [Dkt #13]. Having reviewed the pleadings, supporting

documents, and relevant case law, the Court GRANTS plaintiff s motion for remand and

DENIES defendants’ motions to dismiss as moot.

BACKGROUND

Plaintiff Boyd, president of the National Black Farmers Association, fought for

more than two decades to remedy discrimination against minority farmers. See Compl.

W 1, 10 [Dkt #1]. The facts of this particular case stem from his lobbying efforts on

1

behalf of Native American class members in their discrimination suit against the federal

government, Cobell v. Salazar, Civil Action No. 1:96—cv-01285—TFH (D.D.C. Dec. 7,

2009) (“Cobell”). See Comp]. 1] 25. The class members in Cobell were represented by,

among others, defendants Gingold and Kilpatrick. Compl. W 12-14. In March 2010,

plaintiff was asked by John Loving, a government relationship advisor at defendant

Kilpatrick, to lobby in support of legislative funding for the Cobell settlement. Compl. W

25-26. Plaintiff agreed and continued his lobbying efforts. See Compl. j] 31. Later that

same month, the House of Representatives passed the Claims Resolution Act of 2010

(“CRA”), an appropriations bill that, if enacted, would provide settlement funds for

Cobell class members. Compl. fi 30. In June 2010, plaintiff informed defendant Gingold

“that he expected to be paid for his efforts to secure funding.” Compl. f 43. Defendant

Gingold promised that “Mr. Boyd would be compensated,” but did not specify “how

much and when” plaintiff would be paid. Compl. 1] 43. The CRA became law in

December 2010. Compl. f 4.

On May 6, 2014, plaintiff, a Virginia resident, filed suit against defendants in the

DC. Superior Court alleging unjust enrichment, breach ofimplied—in—fact contract, and

quantum meruz‘t. See generally Compl. On May 27, 2014, defendant Gingold, a

Maryland resident, removed the action to this Court, claiming that defendant Kilpatrick, a

Virginia resident, had been fraudulently joined to destroy diversity jurisdiction. See

generally Notice of Removal [Dkt. #1]

ANALYSIS

Federal courts are courts of limited jurisdiction and the law presumes that “a cause

lies outside” the Court’s jurisdiction unless otherwise established. Kokkonen v. Guardian

Life Ins. Co. 0f/1m., 51 1 US 375, 377 (1994). It is a plainti 11‘s prerogative, as master of

his case, to commence his action in state court. This right, however, is not inviolate, and

a defendant may remove to federal court any action, including a diversity action, that

might have originally been brought in federal court. 28 U.S.C. § 1441(a); see Busby 12.

Capital One, NA, 932 F. Supp. 2d 114, 126—27 (D.D.C. 2013). Diversityjurisdiction

exists when the amount in controversy exceeds $75,000 per plaintiff, exclusive of interest

and costs, and the controversy arises between citizens of different states. 28 U.S.C. §

1332(a). If diversity jurisdiction is incomplete, the federal court must remand the action

to state court. See 28 U.S.C. § 1447(C).

Here, it is undisputed that both plaintiff and defendant Kilpatrick are citizens of

Virginia, and that diversity is, accordingly, incomplete.I The defendants argue, however,

that removal on diversity grounds was proper because defendant Kilpatrick was

fraudulently joined to defeat federal jurisdiction. See generally Notice of Removal.

J oinder is fraudulent where either: (1) the plaintiff fraudulently pled jurisdictional facts to

bring the defendant into state court or (2) there is no possibility that the plaintiff can

1 Citizenship for limited liability partnerships like defendant Kilpatrick is based upon the

citizenship of each of its partner members. See C. T. Carden v. Arkoma Assoc, 494 US. 185,

189 (1990) (holding that limited partnerships do not follow the citizenship rules established for

corporations); Johnson-Brown v. 2200 M St. LLC, 257 F. Supp. 2d 175, 178 (D.D.C. 2003)

(partnerships carry the citizenship of each of their members). Because at least one ofdefendant

Kilpatrick’s partners resides in Virginia, defendant Kilpatrick, like Plaintiff Boyd, has Virginia

citizenship.

establish a cause of action against the resident defendant. In re T obacco/th ’1 Heath

Care Costs Ling, 100 F. Supp. 2d 31, 39 (D.D.C. 2000). In cases alleging fraudulent

joindcr, a federal court may assume jurisdiction in the first instance to determine whether

joinder was proper. Hein Pbam v. Bank ofNew York, 856 F. Supp. 2d 804, 808 (ED. Va.

2010) (citing cases).

Defendants claiming fraudulent joinder bear a “heavy” burden. Walter E.

Campbell Co. v. Hartford Fin. Servs. Grp. Inc, 959 F. Supp. 2d 166, 170 (D.D.C. 2013)

(citation and internal quotation marks omitted). If the Court concludes, after construing

all of the facts in a plaintiffs favor, that “there is even a possibility that a state court

would find a cause of action stated against [the instate defendant] on the facts alleged by

the plaintiff,” diversity is incomplete and the case must be remanded. Id. (emphasis

added) (quoting 3., Inc. v. Miller Brewing Co, 663 F.2d 545, 550 (5th Cir. 1981)). As

such, the District Court’s role in this context is a limited one. The Court must not delve

“into the legal and factual thicket” of a merits analysis, but must instead confine its

inquiry to whether, on the basis of the claims pled, the plaintiff has shown even a slight

possibility of relief. Brown v. Brown & Williamson Tobacco Corp, 26 F. Supp. 2d 74,

77 (D.D.C. 1998) (citation and internal quotation marks omitted). Unless a plaintiff’s

claims are “wholly nonsensical, remand is the appropriate course of action.” Id. (quoting

Pulse One Comm ’cns, Inc. v. BellAtlantic Mobile Sys, Inc., 760 F. Supp. 82, 84 (D. Md.

1991)).

Defendants do not argue that plaintiff fraudulently pled jurisdictional facts. This

Court therefore confines its inquiry to whether plaintiff has shown a possibility of relief

4

as to the claims pled.2 To prove unjust enrichment under District of Columbia law, a

plaintiff must show that he conferred a benefit that the defendant unjustly retained. Pearl

v. District ofColumbia Housing Audi, 972 A.2d 810, 813 (DC. 2009). A person confers

a benefit if he “performs services beneficial to or at the request of the other.” Bregman v.

Perles, 747 F.3d 873, 878 (DC. Cir. 2014) (quoting Restatement (First) of Restitution § 1

(1937), cmt. b). Retention of the benefit is unjust when it flows from “a wrongful act

giving rise to a duty of restitution.” News World Commc ’ns, Inc. v. Thompsen, 878 A.2d

1218, 1225 (DC. 2005) (citation and internal quotation marks omitted). Plaintiff here

alleges that, at defendant Kilpatrick’s urging, he expended time, money, and resources to

help the Cobell litigation team recoup attorneys’ fees. See Compl. W 26-28. Regardless

of whether plaintiffs efforts were crucial to the CRA’s enactment, his extensive lobbying

efforts to “move the ball forward” on the CRA legislation conferred a tangible benefit on

2 Defendant Kilpatrick argues that the doctrine of defensive collateral estoppel precludes

plaintiffs action altogether. See Kilpatrick Opp’n at 11 [Dkt #27]. Defendant Kilpatrick asserts

that this Court’s decision in a related case brought by plaintiff, Boyd v. Farrin, 958 F. Supp. 2d

232 (D.D.C. 2013) (“Boyd 1’ ’) held that plaintiff “has no legally protected interest in settlement

proceeds authorized by the CRA.” Kilpatrick Opp’n at l 1. This misstates the Court’s holding in

Boyd 1. This Court ruled in Boyd 1 that plaintiff had no legally protected interest in either

plaintiff 'or attorneys ’ fees obtained directly from the settlement, not that he lacked any rights to

payment whatsoever. 958 F. Supp. 2d at 239. Defendant Kilpatrick’s alternate theory, that

defensive collateral estoppel bars plaintiff from asserting breach of contract and quantum meruil

claims arising from different circumstances and involving entirely separate defendants, is

similarly meritless. Although defensive collateral estoppel “allows defendants to prevent a

plaintiff from asserting a claim that the plaintiff has previously litigated and lost against other

defendant,” Mead v. Lindlaw, 839 F. Supp. 2d 66, 72 (D.D.C. 2012) (citation and internal

quotation marks omitted), it is equally true that “preclusion in the second case must not work a

basic unfairness to the party bound by the first determination,” Marlin v. Dep ’t of Justice, 488

F.3d 446, 454 (DC. Cir. 2007) (citation and internal quotation marks omitted). To invoke the

doctrine of defensive collateral estoppel in this case, where the outcome depends on the

existence of nonexistence of an agreement unique to these parties, would be an extreme

application ofjudicial economy indeed.

defendant Kilpatrick. See Bregman, 747 F.3d at 878 (finding unjust enrichment

regardless of whether plaintiffs “labors got [defendants] across the goal line”). Plaintiff

further alleges that, in light of the effort he expended at defendants“ behest, see Compl.

W 27-28, defendant Kilpatrick’s refusal to pay him is unjust, see id. ii 101. Plaintiff has

therefore stated a cause of action under D.C. law that is not wholly unreasonable.3 The

Court’s inquiry ends there. Plaintiff s likelihood of success is not “terrain upon which a

court uncertain of its jurisdiction should tread” and is properly left to the judgment of the

DC. Superior Court on remand. See Brown, 26 F. Supp. 2d at 77.

Plaintiff has likewise shown a possibility of relief as to his alternate claims: breach

of implied-in-fact contract and quantum meruz’t. Under District of Columbia law, an

implied-in-fact contract is “a true contract, containing all necessary elements of a binding

agreement” that “is inferred from the conduct of the parties in the milieu in which they

dealt.” Steuart Inv. CO. v. Meyer Grp. Ltd, 61 A.3d 1227, 1233 (DC. 2013) (quoting

Vereen v. Clayborne, 623 A.2d 1190, l 192 (DC. 1993)). Although the terms ofthe

agreement need not be “fixed with complete and perfect certainty,” they must reflect, at

3 Nor are plaintiffs claims time barred. Unjust enrichment is governed by a three—year statute of

limitations, which runs from the date plaintiff“has been made aware that the [defendant] is

refusing to perform.” LoPiccolo v. Am. Univ, 840 F. Supp. 2d 71, 78 (D.D.C. 2012). Although

defendant Kilpatrick claims that this clock has run because plaintiff was made aware in June

2010 that defendants were “refusing to perform,” see Kilpatrick Opp’n at 19, this argument

misconstrues plaintiffs complaint. Plaintiff states that in June 2010, he was told by defendant

Gingold that he “would be compensated,” but not “how much and when.” See Compl. 11 43.

Accepting this allegation as true, this Court finds that defendant Gingold did not repudiate any

duty to compensate plaintiff at that point. Nor will this Court use a “last—rendition—of-service”

test—which has not been formally adopted by the District of Columbia—to assess the timeliness

of plaintiffs claims. See Bregmcm, 747 F.3d at 878 n.4 (“The District of Columbia Court of

Appeals has not adopted the last rendition of services test”).

base, a quantum of mutual assent. Rosenthal v. Nal’l Produce C0., 573 A.2d 365, 370

(DC. 1990). To recover in quantum meruz‘t, a plaintiff must show that: (l) valuable

services were rendered; (2) for the person sought to be charged; (3) the services were

accepted, used, and enjoyed by the person sought to be charged; (4) under circumstances

that reasonably notified the person sought to be charged that the person rendering

services expected to be paid. New Economy Capital, LLC, v. New Markets Capital Grp.,

881 A.2d 1087, 1095 (DC. 2005) (quoting FredEzra Co. v. Pedas, 682 A.2d 173, 176

(DC. 1996)).

Plaintiff has, as an initial matter, stated a cause of action for breach of implied-in-

fact contract. 4 Defendant Kilpatrick asked plaintiff for assistance in procuring funding

for the Cobell settlement, a task that plaintiff readily engaged in until the CRA’s

enactment in December 2010. See Compl. W 26-28, 30, 39. Plaintiff’s allegations,

which this Court must accept as true, evidence a mutual understanding with defendant

Kilpatrick that he would lobby Congress until the enactment of suitable appropriations

legislation. Defendant Kilpatrick’s failure to provide quid pro quo for his services

constitutes breach of this agreement. Plaintiff has therefore stated a cause of action

against defendant Kilpatrick that is neither unreasonable nor “wholly nonsensical.”

Whether the contours of this agreement are sufficiently definite for plaintiff to prevail is

beyond the scope of this Court’s inquiry.

4 For the same reasons discussed in note 3, supra, plaintiffs breach of implied-in—fact contract

and quantum meruit claims are not time barred.

The same is true of plaintiff“ s quantum meruil claim. Plaintiff rendered valuable

lobbying services, the fruits of which defendant Kilpatrick “accepted and enjoyed.”

Moreover, by alleging that he informed defendant Gingold, who, routinely worked from

defendant Kilpatrick’s office during the pendency of the Cobell action, of his expectation

for payment, plaintiffhas pled “circumstances that reasonably notified” defendant

Kilpatrick of his expectation. See Compl. W 14, 43. Because plaintiff has advanced a

cognizable claim, this Court ventures no further into the thickets of a merits analysis. It

is the province of the DC. Superior Court to determine whether plaintiff’s allegations

actually do have merit.

Based on the forgoing. the Court concludes that defendant Kilpatrick was not

fraudulently joined and that the DC. Superior Court is the proper forum for this action.

Accordingly, it is hereby

ORDERED that plaintiffs Motion to Remand [#13] is GRANTED and it is

further

ORDERED that defendants’ Motions to Dismiss [#7, 11] are DENIED as moot.

SO ORDERED.

l

RICHARD . 7

United States District Judge