D.C. Superior Court Opinions
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D.C. FALSE CLAIMS ACT / QUI TAM SUIT
PUBLIC DISCLOSURE BAR / “DIRECT KNOWLEDGE” AND “ORIGINAL SOURCE” DOCTRINES DISTINGUISHED / STATUTE OF LIMITATIONS / FAILURE TO STATE A VALID CLAIM / CONSPIRACY TO FRAUDULENTLY OBTAIN FUNDS FROM THE DISTRICT / STATUTORY INTERPRETATION / FAILURE TO PLEAD FRAUD WITH PARTICULARITY
Abstract: The Trial Judge in this case wrote a careful, methodical, and detailed memorandum order which thoroughly treats the various arcane issues that arise in both commercial paper and qui tam litigation. The factual and procedural backgrounds to the case are summarized as follows: Facts. (1) The assignment and sale of securities instruments, such as mortgages and deeds of trust, is a common commercial practice, covered by Article 9 of the U.C.C. Traditionally, every such assignment or sale had to be individually filed in the local office of land records. As land sales increased dramatically, so did the escalation of filing costs to mortgage lenders, as did the number of errors in the records. (2) In 1994, the Defendant Company created an electronic recording system for mortgages and other commercial paper which enables such dealers to file the necessary documents more easily and to keep track of them as they may change hands. A comparatively modest fee (e.g. $50-$75) is charged for each filing. (3) In a questionable practice, for each transaction, the system designated the Company as the mortgagee of record or beneficiary, as nominee for the lender, on the original mortgage or deed of trust, thus giving it “naked title.” (4) The Relator, a resident of Nevada, has worked in the mortgage industry for nearly 40 years, with a focus on loan processing and chain of title analysis. In early 2009, he concluded that the system’s naming the Company as the mortgagee of record or nominated beneficiary for the lender was a false statement and that public recordation of such a document constituted a fraud, indented to avoid the recording of sequential assignments of interest each time a note changed hands. (5) In due course, he focused on the practice as an alleged fraud and filed qui tam suits in at least four other jurisdictions, all of which were dismissed (6) On or about April 30, 2010, he notified the Office of the D.C. Attorney General of his information “under seal,” according to him. (7) Ten days later, he filed this suit under the terms of the D.C. False Claims Act (FCA), which permits a private party, if s/he is an “original source” of the information at issue, rather than deriving it from information already in the public domain, to file a qui tam fraud suit as a relator for the benefit of the District, which then becomes the real party in interest if it pursues the cause of action. Such a relator becomes eligible for a portion of the recovery if the suit is successful. (8) This cause of action has a statute of limitations of (a) not more than six years after which the violation is committee, or (b) more than three years after the date when material facts are known, or reasonably should have been known, by the D.C. Attorney General’s Office, but (c) in no event longer than nine years after the date on which the violation is committed, whichever occurs first. Proceedings. (1) This action was filed on May 10, 2010, followed by two Amended Complaints during the next nine months. (2) On March 14, 2011, the D.C. Attorney General declined to exercise the statutory right to intervene and prosecute the action. (3) After service of process, the Defendants moved to dismiss on the grounds that (a) the Court lacked subject matter jurisdiction over the allegations because they had already been publicly disclosed prior to the filing of the suit and the Relator was therefore not the “original source” thereof; (b) the statute of limitations had already expired on the matter; (c) therefore, the suit did not set forth a claim upon which relief could properly be granted; and (d) fraud had not been pled with the particularity required by Rule 9(b). (4) The Relator opposed all these contentions, responding on the merits, and alternatively requested leave to amend for the third time. Rulings: The Court ruled on the issues presented as follows: (A) Standards. (1) Where a defendant challenges the court’s subject matter jurisdiction under Civil Rule 12(b)(1), the plaintiff has the burden of establishing same. (2) In making its determination, the court may consider facts and materials outside the pleadings without converting the motion into one for summary judgment. (3) Moreover, unlike dismissal motions on other grounds, the facts are not construed in favor of the plaintiff. (4) Although Rule 8(a) only requires a “short and plain statement of the claim showing that the pleader is entitled to relief,” that is simply a baseline requirement. (5) To survive a motion to dismiss, “a complaint must state a claim to relief that is plausible on its face,” not merely possible, which obtains “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” (6) Mere legal conclusions are insufficient, but a court should not dismiss a case simply because it does not believe that the plaintiff can prevail. The Court applied these standards to the four reasons that the Defendants’ advanced for dismissal of the suit, as follows: (B) Public Disclosure Bar. (1) To the Defendants’ contention that the Court lacked subject matter jurisdiction because the information in the complaint did not originally derive from the Relator, but was already in the public domain, the Relator responded that (a) there was no public disclosure, and, even if there had been, he was the original source for its publication, and/or (b) the Trial Court should declare a new and broader approach to such claims which, presumably, would be affirmed on appeal. (2) The Court examined the aspects of this defense as follows: (a) Generally. (i) The general rule is that “a qui tam action cannot be sustained where all the material elements of the fraudulent transaction are already in the public domain and the qui tam relator only comes forward with additional evidence incriminating the defendant.” (ii) It is insufficient that the relator supplies more detail than is already in the public domain; nor is it dispositive that a relator may have the ability to recognize the legal consequences of a publicly disclosed fraudulent transaction or merely uses his or her unique expertise or training to conclude that the material elements already in the public domain constitute a false claim. (iii) The key is “whether the public disclosure at issue is sufficient to set the government on the trail of the alleged fraud without the relator’s assistance.” (iv) The “public domain” includes (a) the general news media, (b) scholarly, scientific, and technical periodicals, and (c) trade journals, inter alia. (b) Particularly. (i) On this public disclosure score, the Defendants set forth in their motion scores of exhibits from public forums, including court decisions, newspaper, magazine, and journal articles, government reports, congressional testimony, and Internet sites on the subject, arguing that they demonstrate that this issue had long since been in the public domain and that the Relator could claim no incipient credit for the information. (ii) The Relator responded that most of this information, particularly the unregulated Internet, was simply not verifiable and was simply not information on which the court, or any other authority, could rely. (c) Rulings. (i) The Court rejected this argument, cleaving to the tradition of making a “broad” construction of the term to include all the foregoing sources, finding what it deemed the “sheer volume” of which, including the Internet sites, to be persuasive on the public disclosure front. (ii) It ruled that the controlling issue in this regard was not the “reliability” of these sources, but “whether the allegations were actually placed into the public domain and that the District would reasonably have had the information necessary to seek its own remedy pursuant to the False Claims Act.” (iii) The Court went through all seven of the Relator’s allegations, citing the number of publications regarding each, seriatim, as follows: (a) The formation of the Defendants’ system was motivated by financial self-interest (11 public sources); (b) Defendants’ misrepresentation of their role (8 public sources); (c) Defendant’s improperly assuming the role of nominee or beneficiary of the mortgages et al. (28 public sources); (d) Same with regard to assuming the role of beneficiary (8 public sources); (e) Defendants’ use of those designations to avoid recording assignments of interest as property changed hands (12 public sources); (f) Defendants’ utilization of these designations to profit from avoiding the payment of substantial sums in recordation fees (12 public sources); (g) A major negative result of such practices has been the creation of numerous difficulties in establishing a clear chain of tittle at the time of foreclosure (6 public sources); (h) Defendants initiated and conducted non-judicial foreclosures (8 public sources); and (i) Defendants designated non-company employees as officers to sign documents on its behalf (5 public sources). (iv) The Court found, although with some skepticism, that the Relator had informed the District of this alleged fraud in April 2010, prior to filing suit the next month. (v) The Court made a finite distinction between “direct and independent knowledge” by a relator and “original source” of the information. (vi) It found that, based upon his years of experience in this field and his realization of the alleged fraud, the Relator qualified as one having “direct and independent knowledge.” (vii) But it also pointed out that in order to be an “original source,” a relator “must show that s/he “did more than apply … expertise to [already] publicly disclosed information.” (viii) The Court further found, “as a matter of logic,” that the public disclosures of the information at issue had not been based on the Relator’s information because his first realization of the alleged fraud was “shortly after” January 2009 and he did not disclose it to the D.C. Attorney General’s Office until April 2010. (ix) On this basis, the Court ruled that the Relator “is not an original source of the allegations in the … complaint pursuant to the” FCA, which defines that term as [a] “an individual who has direct and independent knowledge of the information on which the allegations are based, [b] who voluntarily provided the information to the District before filing an action based on the information, and [c] whose information provided the basis or catalyst for the investigation, report, hearing, audit, or media disclosure which led to the public disclosure.” (x) Accordingly, the Court ruled that the Relator “cannot take shelter in the ‘original source’ exception to the jurisdictional public disclosure bar.” (xi) The Court also roundly rejected what it deemed the Relator’s “rather perplexing argument” that it “should ignore the precedent of its supervisory Court and strike its own path” in disregarding the surfeit of publications extant prior to the filing of this suit. (xii) Therefore, the Court concluded that it lacked subject matter jurisdiction to hear this matter because of the public disclosure doctrine. (C) Statute of Limitations. (1) The FCA prohibits the filing of a qui tam action (a) more than six years after the date on which the violation was committee or (b) more than three years after the date when material facts are known, or reasonably should behave been known, by the Office of the D.C. Attorney General, but (c) in no event longer than nine years after the date on which the violation is committed, whichever occurs first. (2) Since the Defendant Company began operating in 1996, and early reports of the Defendants’ practices had been published during 1994-97, the Court concluded that the District (and the Relator himself) “reasonably should have known” from these public disclosures that an FCA suit was actionable no later than 2008, even under the full nine-year limitations period, but he did not do so until 2010. (3) The Court found that, although the number of such putatively fraudulent transactions during that period may not be known, the material facts underlying this practice “do not depend on specific mortgage documents.” (4) It also rejected the Relator’s argument that the time period should have been tolled because the Defendants had “affirmatively concealed their fraudulent conduct.” (5) The Court found this concept inapplicable under the fraudulent concealment rule. (i) Under this rule, the limitations period is suspended when a defendant has “employed affirmative acts to … fraudulently concealed either the existence of the claim or facts causing the basis of a cause of action.” (ii) However, if the plaintiff “knew, or by the exercise of due diligence could have known, that s/he may have had a cause of action” the time will not be tolled. (iii) The Court could not find, it said, that the District (as the true plaintiff in interest) could not have known, upon exercising due diligence, that it may have had a cause of action despite to any concealment by the Defendants. (iv) The Court therefore concluded that the FCA statute of limitations “nonetheless bars this action,” thus depriving it of subject matter jurisdiction. (D) Failure to State a Claim. The Court analyzed this contention as to whether the Defendants’ statements or actions constituted a false statement, as follows: (1) The Defendants argued that styling themselves as a mortgagee, nominee, or beneficiary did not constitute a “false statement” under the FCA. (2) Although the weight of persuasive case law holds that the Defendants were correct on this score, at this stage of the case, the Court found that, drawing inferences in favor of the Relator, a sufficiently pled “colorable claim” had been made. (3) However, the Court found that, although all changes of title and interest were required to be publicly recorded, the Defendants can be deemed “lenders” under the common usage of the trade, and qualified for the “lender-to-lender” exception to the requirement to pay fees for “secondary market transactions.” (4) Moreover, the Court found, the transfers between members of the Defendants’ database “do not convey an economic interest in real property” and “are not the same as deeds denoting a transfer of an economic interest” therein. (5) Therefore, neither their self-designation nor their actions could be denominated as false or fraudulent, and accordingly the Relator’s complaint on this count “does not state a claim upon which relief may be granted, as a matter of law.” (E) Conspiracy/Continuing False Claims. (1) Although the Relator did not oppose the Defendants’ argument on the conspiracy and continuing false claims counts, the Court acceded to the stated preference of the Court of Appeals in such matters that, rather than simply dismissing them, a trial court should decide the case on the merits, rather than the “procedural missteps of the parties.” (2) Accordingly, the Court addressed the final two counts in the complaint, as follows: (a) The pertinent statute penalizes any person who “conspires to defraud the District by getting a false claim allowed or paid by the District, or (b) who “is a beneficiary of [even] an inadvertent submission of a false claim to the District, [who] subsequently discovers the falsity of the claim, and fails to disclose” same to the District. (3) The statue defines “claim” as “a request or demand for money, property, or service made to any employee, officer, or agent of the District, or to any contractor, grantee, or other recipient, whether under contract or not, if any portion of … [same] was provided by … the District, or if the District will reimburse such … [entity] or other recipient for any portion of the money or property which is requested or demanded.” (4) Noting that the foregoing makes illegal a “false claim” via a “demand or request for money, property, or services” from the District, the Court carefully pointed out that no such allegation was made by the Relator. Rather, the complaint asserts “the concealment of an alleged obligation to pay funds to the District. (5) It was clear to the Court that this particular statute did “not facially impose penalties for participation in a conspiracy to conceal an obligation to pay … or failing to disclose a later-discovered inadvertent concealment of an obligation to pay” fees or other funds to the District. (6) The Court interpreted this statute on the basis of what it did not say as much as on its express terms. “When the drafter of a statute includes particular language in one section … but omits it in another,” the Court ruled, “it is presumed that the drafter acts intentionally and purposely in the disparate inclusion or exclusion,” otherwise known as inclusio unius est exclusio alterius. (7) Accordingly, the Court found that these counts “must fail as a matter of law, as the cited provisions do not impose liability for the actions alleged …, even presuming the truth of those allegations.” (F) Pleading Fraud with Particularity. (1) Finally, the Court addressed the Relator’s claim that the specificity pleading requirement for fraud in Rule 9(b) should be relaxed in cases, such as this one, with “hypernumerous instances” of same. (2) The Court noted that the uniform holding under that rule is that false claims and anti-fraud statutes require that “complaints brought [there]under … must comply with Rule 9(b).” (3) Indeed, under D.C. law, “fraud is never presumed and must be particularly pleaded” with the “time, place, and content … of the fraud.” (4) At the same time, however, the Court agreed with the Relator that he “need not describe … the particular circumstances of each individual false claim [that ever took place] under this rubric. To hold a relator or plaintiff to this standard, the Court observed, “would make the filing of a qui tam complaint alleging pervasive and systemic false claims over a period of years, as in this case, so unwieldy and burdensome as to contravene the purpose of the False Claims Act.” (5) It concluded that Rule 9(b), therefore, “does not require a detailed description of each and every false claim where the fraud takes place over many years, involves numerous false claims, and the alleged scheme is sufficiently complex.” (6) Having said that, however, the Court also found that the Relator had made only “general allegations,” but had made “few distinctions between the acts of the various Defendants” and it therefore “cannot find that … [he] has set forth with particularity facts which would provide the Court and the Defendants with Rule 9(b) notice of the allegations … with respect to their various roles in the alleged fraudulent submissions, conspiracy, and continuing false claims.” The lapses, the Court pointed out, were that (a) he had not set forth which of the entities actually recorded the documents which reflect the false claims; (b) whether the Defendants (or which Defendants) were involved in the secondary mortgage market transactions; and, (c) perhaps most crucially, any substantial distinction between the roles of the Defendants in the alleged transactions resulting in the allegations of false claims. (7) Accordingly, the Court stated, it “would dismiss this action based on a failure to plead with particularity pursuant to … [Rule] 9(b).” (G) Leave to Amend. In view of the fact that the Court had ruled against the Relator on every argument advanced by the Defendants, resulting in a finding of lack of subject matter jurisdiction, it denied what it called his “rather unorthodox request” that he be granted leave to amend for the third time in this case,” which would be his fourth opportunity to set forth a proper complaint. (H) Conclusions. The Court’s conclusions were as follows: (1) The allegations in the Second Amended Complaint were “substantially similar or identical to those previously publicly disclosed and thus barred by the “public disclosure” doctrine applicable to the D.C. False Claims Act. (2) Although the Court found that the Relator qualified as a person with “independent knowledge” of the alleged fraud, it also found that he does not qualify as an “original source” under the statute. (3) This action was filed after the expiration of the FCA’s most expansive statutory limitation period. (4) The most recent complaint fails to state a valid claim upon which relief may be legally granted on all counts. (5) Moreover, it does not plead fraud with the requisite particularity under Rule 9(b). (6) Finally, the foregoing means that the Court does not have subject matter jurisdiction and the case must be dismissed with prejudice.
CRIMINAL LAW AND PROCEDURE
D.C. INNOCENCE PROTECTION ACT / STANDARDS / SECTION 23-110 INEFFECTIVE ASSISTANCE OF COUNSEL MOTION / STRICKLAND STANDARD / CONTEMPORARY STANDARDS AT THE TIME OF TRIAL / RECANTATION / BRADY EXCULPATORY ISSUES / MATERIALITY
Abstract: In one of the most notorious and brutal local murder cases in the last part of the 20th Century, recent motions to re-open the case based on various grounds, demonstrated the finest efforts each of defense lawyers zealously advocating their clients’ interests, prosecutors even-handedly defending the convictions, and a wise Judge who refused to have judicial integrity subsumed by the passionate arguments of the hour, instead methodically applying the elements of the legal principles at issue. The factual and procedural backgrounds to this case are summarized as follows: Facts. (1) At around 4:00 p.m. on the rainy afternoon of October 1, 1984, Catherine Fuller, a diminutive 38-year-old mother of six, who lived near the intersections of 8th and H Streets, N.E., made the fatal decision to go out to purchase groceries for her family. She carried $50 cash, which she folded into one of her inner garments for safekeeping. (2) She made the mistake of walking past what was then a park (now a large drug store) on the southeast corner of 8th and H Streets. A dozen or so males were “hanging out” at the park, talking about “getting paid,” a slang term for robbery. (3) As Mrs. Fuller walked past them, they quickly decided to rob her. They broke up into two groups and pursued her. As she turned onto 8th Street, one group followed up behind her and coerced her into an alley, while the other moved ahead to cut her off in a pincer movement at the 9th Street end of the alley. (4) Five members of the pursuing group began to punch and kick her and one of them felled her with a blow to the head with a wooden plank. (5) They carried her to the front of an abandoned garage in the alley, where the beating continued. Her garments were partially torn away and her money stolen before she fell into unconsciousness. (6) They dragged her into the garage, where one took a ring from her finger and the rest of her clothes were torn off. (7) Two of them held her legs apart while another took a length of discarded pipe and shoved it approximately a foot into her rectum, also shattering her liver. (8) They left her on the concrete floor of the garage where, after two hours of trauma and exposure, she died, according to the autopsy report, of multiple broken bones, the anal intrusion, and internal bleeding. Her body was discovered that same evening by a street vendor who had gone into the alley to relieve himself. (9) Numerous eyewitnesses placed the Defendants at the crime scene in the alley and they were later arrested and indicted. Proceedings. (1) One of the Defendants (Yarborough) gave two inculpatory statements, one written and one videotaped. His trial lawyer filed a motion to suppress, both on grounds of violation of the Miranda
rule and coercion, which included physical violence. (2) The Trial Court denied the motion, but only the written statement – which the Court ordered redacted as to any references to other co-defendants – was used at trial, and the jury was instructed that it could only be used against the declarant. (3) After a lengthy trial in December 1985, in which the Government relied heavily on co-operating witnesses from the group who had pled guilty to lesser charges, eight of the ten accused were convicted of, inter alia, kidnapping, robbery, and felony murder. (4) In 1988, all convictions were affirmed on appeal, the Court finding that the evidence against the Appellants was “overwhelming.” (5) The Trial Judge died in 1992, and all further matters in the case were assigned to other Judges. Seven years after the trial, in 1995, Defendant Yarborough, acting pro se, filed a post-trial Section 23-110 motion alleging ineffective assistance of trial counsel during the pre-trial suppression hearing, arguing that counsel had not called to the attention of the Trial Court his very low intelligence and educational level. The motion was denied, with the successor Judge expressly ruling that he had failed to show the requisite prejudice under the Strickland rule (1984). (6) During the 25 years since the trial, one of the Defendants died in prison and another was paroled; the remaining Defendants are still serving their sentences. (7) In December 2011, they filed a motion under the D.C. Innocence Protection Act (IPA), asserting that they were actually innocent of the crimes, and contending that (a) before trial the police had literally beaten confessions and inculpatory statements out of certain witnesses; (b) at the time of trial, the Government deliberately failed to convey this and other materially exculpatory evidence to the collective defense lawyers, in violation of the Brady rule; and, finally, (c) one Defendant raised a Section 23-110 claim anew, based on ineffective assistance of counsel during the pre-trial motions stage of the original case. (8) Further, their affirmative evidence consisted of advancing the contention that the erstwhile co-defendants who testified against them during the trial (a) were coerced by the police to lie and (b) have now recanted their testimony as false, and was based entirely on news reports rumors, and information fed to them by the Government. (10) This motion was assigned to the author of this opinion, who, after having served 34 years, was by then the most senior active Judge on the Superior Court. He held a 23-day evidentiary hearing from late April to mid-May 2012, at which the Court took testimony regarding all of the Defendants’ claims. Rulings: The Court set forth three basic rubrics in making its rulings: (1) the linchpin of the entire matter would depend on whether the Court believed the recantations of the former Government co-operating witnesses; (2) certain decisions would be made on the basis of standards relevant to the time period of the trial; and (3) issues that had already been fully litigated would not be reconsidered. It then ruled on the issues presented as follows: (A) Ineffective Assistance. (1) The Court began with a review of the lone ineffective assistance of counsel claim. At the outset, it pointed out that a person convicted of a crime is afforded only one Section 23-110 motion, in which all claims must be made. This is due to the practice of conserving judicial resources so as not to allow seriatim piecemeal claims to be raised by those who have been convicted, known as the “abuse of the writ” doctrine. (2) To this Defendant’s claim that his unsuccessful motion before another Judge seven years earlier had been pro se, without counsel, and the ironic product of the very subject thereof, i.e., his limited intelligence and education, the Court pointed out that there are no exceptions to the general one-motion rule in this regard. (3) However, the Court ruled, although ordinarily it would decline to consider a successive 23-110 motion, because “the question was not entirely free from doubt,” it decided to address the issue de novo. (4) Under the well-known Strickland standard (1984), to succeed on such a motion a defendant must show (a) counsel’s performance was so deficient that it fell below an objective standard of reasonableness, and (b) the deficient performance was so prejudicial that, but for counsel’s errors, the result of the proceeding would probably have been different. (5) The threshold rule is that counsel should be given “sufficient latitude to make tactical decisions and strategic judgments involving the exercise of professional abilities.” (6) In so doing, a court should “strongly presume” that counsel “rendered adequate assistance and made all significant decisions in the exercise of professional judgment,” without second-guessing counsel’s conduct. (7) The rule is that “a reasonable tactical decision will not support a claim of ineffective assistance of counsel.” (8) Thus, “a new trial should not be ordered because the court or another attorney, with hindsight, might have chosen a different course.” (9) To establish the prejudice to the case in a Strickland analysis, the defendant must demonstrate “a reasonable probability that, but for counsel’s unprofessional errors, the result of the proceeding would have been different.” (10) In turn, a “reasonable probability” is one “sufficient to undermine confidence in the outcome” and requires a “’substantial,’ not just ‘conceivable,’ likelihood of a different result.” (11) In the context of this issue, which involved counsel’s conduct in prosecuting a suppression motion, the defendant’s burden to show prejudice is to demonstrate “that the motion, if properly litigated, would have been granted and, had the evidence been suppressed, it is probable that the outcome of the trial would have been different.” (12) To support his claim, this Defendant presented the testimony of two Ph.D. psychologists. (a) One had examined him and determined that his IQ was approximately 70, which put him in the bottom one percent, meaning that he is more suggestible than 99% of the population. (b) The other, who was also a J.D. and an expert in criminology as well, testified that, although a relatively small number of confessions are false, they prove that false confessions do occur. Their common features include harsh interrogation techniques, threats or promises of leniency or other reward to produce a confession, all of which are particularly effective on the mentally retarded. He concluded that “there is a heightened risk of a false confession” in this case. (13) The Court, however, concluded that “a heightened risk of a false confession is not the same as a likelihood that the confession is false.” It found that, other than the latter expert’s “own intuition,” he had produced no evidence that this had occurred with regard to this Defendant. (14) The Court ruled that “reasonably competent representation in 1985 did not require every defense attorney to develop the kind of sophisticated psychological testimony … [on which this Defendant] now relies …, much less the largely inadmissible expert testimony on false confessions.” (15) Moreover, even assuming that this additional evidence of the Defendant’s “low intellectual functioning and educational level might have marginally aided the presentation of the motion,” the Court ruled that “it cannot be said that an otherwise competent defense attorney in 1985 was performing below the constitutional minimum standard by focusing on … heavy handed police interrogation techniques rather than on his client’s individual vulnerability.” (16) The Court also found that such evidence would not have changed the outcome on the motion to suppress because, although Yarborough did lie about certain things in his statement to the police, he did not lie about being present at the scene of the murder; indeed, the evidence “overwhelmingly put him there,” the Court pointed out. His falsehoods were that he did not participate in the attack, robbery, and murder of the victim, but that he was only an observer. (17) Such a self-serving lie, the Court observed, “was not the statement of a helpless mentally vulnerable young man being fed facts by the police and parroting them back to please his interrogators.” Rather, “it was the voluntary admission of a conniving youthful offender trying to distance himself as far as possible from the crime while not denying that he was there, which he [also consciously] assumed the police already knew,” the Court concluded. (18) In view of that deviousness, the Court was confident that “no amount of psychological testing or social science research was likely to convince the [trial] court that this false exculpatory statement should be suppressed, particularly where the Judge did not believe the Defendant’s claim about physical coercion in the first place.” (19) The capstone for this conclusion was the reviewing Court’s observation of Yarborough’s testimony pursuant to his current motion, which it found self-contradictory, filled with “extraordinary claims,” particularly regarding the alleged police violence perpetrated upon him prior to his statement, contained other “outlandish allegations” that were contradicted by the testimony of police witnesses who had been present at the interrogation, and overall, was “patently incredible.” (20) Finally, the Court noted that “all of this was litigated at the trial in 1985,” and the Trial Judge had ruled that a valid Miranda waiver had been obtained – a ruling which the Court of Appeals affirmed. (21) Finding that his testimony at the hearing on this motion “cannot be credited” and that “the type of evidence he now faults his lawyer for not putting on [at the original suppression hearing] would not have changed the outcome of the motion … or the outcome of the trial,” the Court concluded that Defendant Yarbrough “has not shown either deficient performance or prejudice under the Strickland standard,” and his Section 23-110 motion was denied anew. (B) The IPA Claim. (1) As the title of the statute indicates, the goal of a movant thereunder is to prove his or her innocence, which may be done in one of two ways: (a) to have a conviction vacated, a movant must prove “actual innocence” by the clear and convincing evidence standard, or (b) to obtain a new trial, the movant must prove by a preponderance of the evidence that s/he is actually innocent. (2) The court may consider “any relevant evidence,” but it must consider the following: (a) the new evidence; (b) how it demonstrates actual innocence; (c) why it is not cumulative or merely impeaching; and (d) if the conviction resulted from a trial, and if the movant asserted a theory of defense inconsistent with the current claim of innocence, the specific reason s/he asserted an inconsistent theory at trial. (3) At the outset of its consideration of the IPA motion, the Court noted that the Movants did not actually present any “new” evidence; rather, they were relying entirely on the recantation of the testimonial evidence by four Government witnesses, Messers. A-D. The Court considered them as follows: (4) Witnesses A and B. (a) With regard to the first two, the Court noted that in order to accept their current assertions ostensibly in favor of the Movants, it “must begin by suspending … disbelief” that both of them had pleaded guilty to lesser, but still serious, charges, and had accepted lengthy sentences as the result of police coercion, but are now making truthful assertions to the contrary. (b) Moreover, implicit in their current positions is the premise that each is “a witness who has demonstrated a willingness to lie under oath,” leaving the court to determine which of their version of events is the lie. (c) It is for this reason, the Court pointed out, that “courts are uniformly skeptical of witnesses who come forward long after their testimony to say that everything they previously said under oath is a lie.” Because “witnesses offering recantations are often facing radically different pressures than they were at the time of the ... trial,” to do so “upsets society’s interests in the finality of convictions, is very often unreliable and given for suspect motives, and most often serves merely to impeach cumulative evidence, rather than to undermine confidence in the accuracy of the conviction.” (d) Against this backdrop of traditional skepticism, the Court noted its ability to have seen firsthand the testimony and demeanor of A and B at the hearing on the IPA motion and to compare them with their videotaped interrogations 27 years earlier, as well as having the opportunity to compare it with the completed record testimony of other trial witnesses who had placed some or all of them at the scene of the murder. (e) It found their current assertions that (i) they were not there and (ii) that they had been forced by the police to name others as the perpetrators, to be “nothing short of preposterous.” Not only was their presence corroborated by “too many other witnesses,” but both were also “extensively cross-examined at trial by ten seasoned defense counsel over the course of several days” and they never deviated from their original versions of events. (f) The Court found that “it is exceedingly unlikely that any juror would have concluded that … [they] were not on the scene or that they were not accurately reporting at least most of what they saw, heard, and did that day.” (g) Although they were both currently out of prison and the motives for their 180-degree turn on their previous testimony “cannot be known,” the Court concluded that “whatever their current motivation may be,” it did “not credit their recantations,” which therefore did not help the Movants in proving their actual innocence. (5) Witness C. (a) The Court found that the testimony of this witness was “even less helpful” to the Movants because of her frequent assertions of lack of memory on key facts, including several regarding the savage anal assault on the victim. At the IPA hearing, she repeatedly asserted simply that she had lied at the trial but could not remember anything else. (b) Again, the Court noted that although her motives for trying now to help the Movants were “unclear,” the fact of her repeated contentions of lack of memory “makes her current testimony relatively useless and adds nothing to … [the Movant’s] claims of innocence.” (6) Witness D. (a) The Court noted with surprise that the testimony of the final recanting witness at the IPA hearing, far from benefitting the Movants, “actually supported the Government.” (b) This was because, instead of recanting his trial testimony, he actually recanted a June 2009 affidavit which he had given defense counsel in which he had recanted same. Instead, at the hearing he affirmed his original trial version that he specifically remembered seeing several of the Defendants near the park which the victim had passed that afternoon and saw them watching her cross the street, then pursue her. (c) Whatever else could be said of his putative “recantation,” the Court concluded, “it certainly cannot be said that his testimony helps” the Movants meet their burden of proving “actual innocence. (7) After considering all of the foregoing, the Court concluded that the Movants had “not come close to demonstrating actual innocence.” It ruled that “they have not proved by clear and convincing evidence that they are actually innocent, and just as surely they have not established their innocence by a preponderance of the evidence” so as to merit a new trial. Accordingly, they were “not entitled to relief under the Innocence Protection Act.” (C) The Brady Issues. (1) In the final category of Movants’ claims, the Court addressed the Brady issue. In comparison to the Section 23-110 and IPA claims, the Court noted that the claim that the Government had withheld exculpatory evidence was “not so easily dismissed.” (2) To begin with, in terms of the Government’s obligation to disclose exculpatory evidence in this particular case, the Court pointed out that it was not just “any murder.” In addition to the notorious brutality of the case, which “inflamed the passions of the entire community,” it involved a team of nine police detectives and other officers, interviews with more than 400 witnesses, the arrests of 17 people, 13 indictments, and ten co-defendants at trial, which it took two Assistant U.S. Attorneys to prosecute. (3) The Court pointed out that, with the benefit of hindsight, one could go back through Government files in any criminal case and find materials that could arguably be defined as Brady and that “in an investigation this complex and extensive, it is almost inconceivable that mistakes would not be made.” (4) The Court also noted that “information that would be disclosed today under Justice Department guidelines and relatively recent caselaw would not have been routinely turned over to the defense in 1985.” (5) The elements of a valid Brady claim are that the information at issue must (a) have been withheld by the prosecution; (b) be favorable to the defendant; and (c) be material to guilt or punishment. (6) Such evidence is “material” if “there is a reasonable probability that, had … [it] been disclosed to the defense, the result of the proceeding would have been different.” (7) Materiality is shown “if, in the context of the entire case, the non-disclosure undermines the court’s confidence in the outcome of the trial.” (8) The Court addressed the undisclosed Brady issues seriatim, as follows: (a) A woman reported to the police that she had witnessed a male friend, who lived adjacent to the alley at the time, acting alone, abduct and murder the victim. Two weeks prior to trial, the male friend shot and killed her. This information was not disclosed by the Government. (b) Three witnesses who were in the alley shortly after the murder saw two men acting suspiciously and reported that observation to the police shortly after they arrived on the scene, after which the two men fled. Both were identified and one of the two men had recently been charged with two purse snatchings in the neighborhood. The Government did not disclose either the names of the two men or the witnesses who had seen them. (9) At the 2012 hearing, the Defense argued that the information about these three men could have provide a “counter-narrative” at trial for the argument that the victim had been killed by one or a combination of these men, rather than a mob composed of the Defendants. (10) The Court’s appraisal of this non-disclosed evidence was as follows: (a) As to the woman’s report that her male friend committed the murder, the Court found that: (i) There was “little question” that it was favorable to the Defense and had not been disclosed. (ii) At the hearing, the Government conceded that at a trial today, it would have done so. (iii) The Court ruled, however, that the third Brady element, i.e., that had it been introduced at trial, there was no “reasonable probability that … the result of the proceeding would have been different.” (iv) Moreover, the Court found not only was her testimony “riddled” with internal inconsistencies, but also that her accusation against her friend had been “thoroughly discredited” in that the jury would have had “to believe that …, acting alone, [he] attacked and murdered Mrs. Fuller, in the face of numerous eyewitness accounts [among hundreds] and other evidence proving that [the] crimes were committed by a large group of young men acting in concert.” (v) The Court concluded that even had this witness lived to tell her story, “any reasonable jury, in light of all the evidence, would surely have rejected it. (vi) For these reasons, it ruled that this testimony failed the “materiality” aspect of the Brady rule and therefore did “not undermine the Court’s confidence in the outcome of the trial.” (b) (i) As to the second undisclosed Brady witness, although three eyewitnesses at the scene of the murder identified him as also being present, no other witness identified him via subsequent photo spreads. (ii) The Court did not find this “identification” any more persuasive than that of the first Brady witness. Indeed, it likewise found it to be immaterial but also “arguably not even favorable to the accused.” Although this suspect lived near the alley, no other witness put him near the scene of the murder. Moreover, even if he was there, he could have been a bystander, and his presence would prove nothing as to the innocence of the Movants. (iii) This evidence, the Court also concluded, “does not override the overwhelming evidence of the guilt” of the Movants or undermine its confidence in the guilty verdicts. (c) The Court also came to the same conclusions as to numerous other “subsidiary Brady claims” advanced by the Movants, including putative lies to the police, drug use, lack of recall, and eyewitnesses present in the park who did not mention seeing any of the accused. (D) Conclusions. (1) Having heard and reviewed all of the testimony, the putative recantations of Government trial witnesses, and the theories and arguments from the various Defense Counsel at the hearing in this matter, the Court was “convinced that the totality of evidence pointing to the guilt of … [the Movants herein] in the abduction and murder of Catherine Fuller … remains … ‘overwhelming.’” (2) Because one Defendant, Mr. Yarborough, was ruled not to be entitled to post-conviction relief on ineffective assistance of counsel grounds, the Court ruled that he was also not entitled to the relief sought by the others on separate grounds, either. (3) In addition to that, although it is clear that his statement could not have been used against the other Defendants at trial on a Bruton basis, in the context of this hearing for purposes of the comparison of relevant evidence, his statement actually provides corroborative evidence of the Movants’ collective guilt, which is buttressed by that provided by at least 10 other witnesses. (4) In any event, it certainly does nothing to help prove their “actual innocence,” the Court found. (5) By the same token, although the Government “should have disclosed certain pieces of information back in 1985 that were arguably favorable to the accused,” the Court ruled that “none of the undisclosed information was material under Brady … because none of it – viewed separately or cumulatively – would have made any difference in the outcome of the trial.” (6) This is because, the Court ruled, “it is not enough to show that the Defendants could have used the undisclosed evidence to construct … counter-narratives.” Rather, the materiality element of Brady requires that they show a “reasonable probability” that the undisclosed evidence would have produced a different verdict.” (7) Under that standard, the Court’s ultimate conclusion was that, “based on the entire voluminous record in this case, … [the Movants’] Brady claims, like their innocence claims, must fail.”
TORT LAW / WRONGFUL DEATH
PHARMACIST MALPRACTICE / DUTY TO WARN / LEARNED INTERMEDIARY DOCTRINE DEFENSE HELD INAPPLICABLE
Abstract: The factual and procedural backgrounds to this case are summarized as follows: Facts. (1) The Plaintiff in this case is the estate of the decedent who, for the last year of his life, had done business with a Drugstore which was part of a well-known chain operating in the District. (2) During that year, his physician had prescribed two drugs for him, one for depression and the other for attention deficit hyperactivity disorder (ADHD), both of which he repeatedly filled at the Drugstore. (3) These drugs, when taken together, however, are “contraindicated,” i.e., known to cause serious adverse effects in some patients. The Drugstore used a computerized system that informs the pharmacists of the customer’s prescription history. In this case, it also alerted to the facts that both these contraindicated prescriptions were being filled simultaneously and that they should not be filled without first contacting the customer’s physician to confirm the prescriptions. No such inquiry was ever made, however. (4) After the customer took the drugs together for several months, he died of sudden heart failure in January 2011. Proceeding. (1) The estate filed this suit against the physician, his clinic, and the Drugstore, asserting a duty to warn. (2) The Drugstore contended that (a) it had no duty to warn and (b) in line with the District’s recognition of the “learned intermediary” doctrine (i.e., in this case as the party between the drug manufacturer and the physician), that duty rested with the latter. It therefore moved to dismiss under Rule 12(b)(6). (3) The Plaintiff countered that there is a duty to warn in the face of a known contraindication, and that the Drugstore may not rely to the doctrine as a defense. Rulings. The Court ruled on the issues presented as follows: (A) Standards. (1) Because a motion to dismiss challenges the legal sufficiency of a claim, the court must examine the complaint to determine if it sets forth sufficient information that would permit inferences to be drawn that indicate that the necessary elements of the claim have been properly set forth. (2) In that regard, Civil Rule 8(a) requires only that a complaint set forth a “short and plain” statement of the facts relied upon. (3) The court is required to accept the facts set forth in the complaint as true, construing all the facts and inferences in favor of the plaintiff. (4) At the same time, however, a complaint must include “more than an unadorned, the-defendant-unlawfully-harmed-me accusation.” Thus, “naked assertions devoid of further factual enhancement will not suffice, and the court is not bound to accept as true a legal conclusion couched as a factual allegation.” (5) Rather, 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,” not merely possible. (6) A claim is deemed to have facial plausibility “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” (7) A court may not dismiss a complaint simply because it does not believe that the plaintiff will prevail on the claim. (8) Dismissal for failure to state a claim is warranted “only when it appears beyond a doubt that the plaintiff can prove no set of facts in support of the claim.” (B) Duty to Warn. (1) Where pharmacists are concerned, the majority of jurisdictions do not impose a general duty to warn customers of the potential adverse effects of their medications. Various jurisdictions do not even impose such a duty as to pregnant women, warnings of side effects, or adverse reactions. (2) Those jurisdictions with partial requirements obligate the pharmacist to warn the customer or notify the prescribing physician only under certain circumstances, such as when the patient’s medical history or current medicine regime shows that a prescribed drug is contraindicated, inadequacies in instructions, or prescriptions in obviously lethal doses. (3) Generally, however, case law holds that a pharmacist has a duty to exercise the degree of “ordinary care, skill, thoughtfulness, and diligence” that “a reasonable, prudent person” would in the performance of duties which “ordinarily characterizes the profession.” (C) Learned Intermediary Doctrine. (1) This doctrine acts, in certain circumstances, to insulate an intermediary distributor from liability to a purchaser that should be applied to the manufacturer or the provider, in this case to insulate a pharmacy from liability to a customer that should lie with the drug manufacturer or the physician. (2) In general, courts are reluctant to hold pharmacies liable for injuries caused by drugs that were accurately dispensed according to the terms of a facially valid prescription. (3) Rather, according to persuasive case law from other jurisdictions, “it is only the physician who can relate the propensities of the drug to the physical idiosyncrasies of the patient.” The consensus opinion is that “to impose a general duty to warn on pharmacists would encourage … [them] to ‘second-guess’ the prescribing physician’s decisions” and “would intrude … [the pharmacist] into the doctor-patient relationship.” (4) Although the D.C. Court of Appeals recognized the doctrine in the Payne case (1985), applying it to certain products liability cases, it has never applied it to pharmacists. Its observation was that “the adequacy of the manufacturer’s warnings must be evaluated in relation to” the service provider, not the customer/plaintiff. (5) The Court’s rationale was that where “advertising did not induce purchase of the product, but the product was recommended by an intermediary who is a [learned] professional, the adequacy of the instructions must be judged in relationship to the professional.” Again, however, the Court has never applied that rationale to pharmacists. (6) Because there is no binding D.C. precedent and the general rule throughout the nation is that a pharmacist has no duty to warn a customer of the potential risks of a given medication, the Trial Court herein was “not convinced that that a pharmacy fits within the [defensive] framework of the learned intermediary doctrine” as locally recognized. (7) In this case, taking the allegations as true, as it was required to do at this stage, the Court found that the Plaintiff had adequately pled that the pharmacy knew through its computer system that there could be a serious adverse interaction between the two drugs that had been prescribed to the decedent. (8) It further found a basis to believe that it therefore had a duty to warn him, or to notify his physician, of the contraindication suggesting “a specific, defined, and foreseeable harm about which the pharmacists knew or should have known.” (9) The Court therefore declined to extend the defense of the learned intermediary doctrine to pharmacies, finding “it inappropriate to apply the doctrine to the instant case (at this stage) because the sound policy reasons underlying the doctrine do not appear …. to pertain to this case and should not be applied.” (D) Conclusion. Accordingly, the Defendants’ motion to dismiss was denied.
CIVIL PROCEDURE / PERSONAL JURISDICTION / LONG-ARM STATUTE / APPLICABILITY TO CORPORATE DIRECTORS / “FIDUCIARY SHIELD” DOCTRINE / “MORE THAN AN EMPLOYEE” EXCEPTION / “SPECIAL INTEREST” STANDING / “DERIVATIVE CLAIM” STANDING / FAILURE TO STATE A CLAIM UNDER RULE 12(b)(6)
BREACH OF FIDUCIARY DUTY / BREACH OF CONTRACT / PROMISSORY ESTOPPEL / UNJUST ENRICHMENT
Abstract: This Memorandum Opinion even-handedly addresses a bewildering maze of civil procedure, personal jurisdiction, corporate law, trust law, and civil procedure, breach of contract and fiduciary duty, and various other issues swirling around one of the more controversial institutions in the world, the Unification Church. It is a tour d’ force of legal reasoning which applies neutral precepts of law to a heated dispute among persons and entities who managed to find their way into the judicial system of the District of Columbia from places as far away as South Korea and Japan. The factual and procedural backgrounds to the case are summarized as follows: Facts. (1) The Unification Church, founded in South Korea, by the Rev. Sun Myung Moon in 1954, has since become a complex international organization, with divisions and offices in various cities, including the District of Columbia. (2) The central tenet of the Church is what it calls the “Divine Principle,” a theological belief in “returning resurrection,” which posits that departed souls can expiate their sins and achieve spiritual salvation by returning to earth and cooperating with living people to do good deeds, citing Hebrews 11:40 (“God having provided some better thing for us, that they without us should not be made perfect.”). (3) In 1971, Rev. Moon moved to the United Sates to develop the Church here. Five years later, he directed the opening of a Church bank account in the District to be used for the benefit of its activities. (4) In 1977, Rev. Moon directed that a non-profit corporation be established in the District to implement the purposes of the Church. From the establishment of the corporation to 2006, hundreds of millions of dollars were deposited into the account and those funds were used pursuant to the directives of the corporation’s board of directors. (5) In 2006, the Rev. Moon designed his son Preston as a Director of the Church and of the corporation. (6) Two years later, Rev. Moon, then 86, designated another son, Sean, as the new leader of the Church. Shortly after that appointment, Preston, allegedly disappointed at having been passed over, began to take steps to re-organize the trust. (7) Members of the board of directors of the corporation, including the individual Plaintiffs, were voted out of office and replaced with others loyal to Preston. The reconstituted board then amended the articles of incorporation to remove all references to the Church and its mission to disseminate the Divine Principle. Properties were purchased with trust funds and titled in the names of other corporations that were wholly owned by Preston and payments for “consulting” services were similarly paid out to one of his subsidiaries. Proceedings. (1) In May 2011, the Plaintiffs, two persons acting as officers on behalf of several entities – termed “providential organizations” -- that are closely associated with the Church and which are putative beneficiaries of the trust fund, filed this suit to gain control of the corporation and the bank account and wrest it away from Preston Moon and five other Church officials on the grounds of breach of fiduciary duty, ultra vires acts, breach of contract, breach of fiduciary duty, breach of trust, and unjust enrichment. They also sought injunctive relief against further dissipation of assets and disgorgement of the proceeds of previous actions. (2) The Defendants’ responses were that all actions had been approved by a duly-elected board of directors which took the necessary steps to deal with modern issues facing the Church. They also asserted that the Plaintiffs have no standing to challenge how the corporation is run or how its donations are distributed, because the corporation was originally established “without owners,” i.e., no person, group, or entity has an ownership interest in it, thus leaving it self-governing by its board. (3) Based on these premises, in July 2011, the Defendants filed a Motion to Dismiss pursuant to Rule 12(b)(1), challenging the Court’s personal jurisdiction, and Rule 12(b)(6), challenging the sufficiency of the claim. Rulings: The Court ruled on the issues presented as follows: (A) Standards. (1) The plaintiff bears the burden of proving that the court may assert personal jurisdiction over the defendant. (2) Where multiple non-resident defendants are named, personal jurisdiction must be shown as to each. (3) In so doing, “bare allegations and conclusory statements are insufficient” and the plaintiff must allege “specific facts connecting the defendant with the forum.” (4) The District’s long-arm statute allows the court to exercise personal jurisdiction over a non-resident if that person has, inter alia, “transacted any business” here. (5) That concept is coincident with the maximum authority allowed under the Due Process Clause of the Fifth Amendment. (6) The business transacted need not be “extensive” to subject the defendant to personal jurisdiction here; in fact, a non-resident need not even have been present in the District to fall under that provision. (7) The critical inquiry is “whether the business transacted within the District … can be reached jurisdictionally without offending due process.” (8) That determination is made by showing “that a defendant has sufficient minimum contacts with the forum so that the exercise of personal jurisdiction would not offend traditional notions of fair play and substantial justice.” (9) A defendant must have “purposely directed” its activities at the forum state’s residents, such that it would “reasonably anticipate being hauled into court there.” (10) Thus, “the minimum contacts principle requires … [the court] to examine the quality and nature of the non-resident defendant’s contacts with the District and whether those contacts are voluntary and deliberate or only random, fortuitous, tenuous, and accidental.” (11) Where individual officers, directors, and employees of a corporation are concerned, the court does not automatically have personal jurisdiction over them simply because of that status or because it has jurisdiction over the corporation itself. (12) Under the “fiduciary shield doctrine,” where there are no allegations that a non-resident defendant’s contacts were for the purpose of transacting business individually, but only in that person’s official capacity in order to perpetuate a corporation’s business, such a defendant cannot be sued individually under the “transacting business” section of the long-arm statute. (13) This principle, however, is not absolute or a per se rule, but simply holds that “an individual’s role as a corporate officer, without more, is not a sufficient basis for exercising personal jurisdiction over the officer in his [or her] individual capacity.” (14) But if the non-resident defendant is found to be “more than an employee” of the corporation, s/he may not be protected by the “fiduciary shield,” as where s/he “set company policies and procures, was active in day-to-day operations, and maintained active involvement and supervision of all aspects of the company.” (15) Thus, if a court finds the “more than an employee” exception applies, it can impute the corporation’s contact with the District to the individual defendants who control the corporation, even if those defendants are not personally transacting any business here. (16) Although the D.C. Court of Appeals has never formally adopted the “more than an employee” exception, it has favorably referenced it in several opinions and has been applied by the U.S. District Court here. (17) Pleadings are construed “so as to do substantial justice.” (B) Personal Jurisdiction. (1) The Court found that it had jurisdiction over the corporation because it was organized under D.C. law. (2) Because, however, none of the individual Defendants was a resident of the District, the Court could exercise personal jurisdiction over them under the “transacting business” section and the “causing harm” section of the District’s long-arm statute. (3) As directors of the corporation, they had participated in business transactions by filing amended articles of incorporation, managing and selling properties, and operating or managing other businesses here, as well as engaging in conduct which the Plaintiffs alleged caused injury to them and to the corporation in the District. (4) Similarly, the Plaintiffs alleged that the individual Defendants “subverted the mission” of the Church by changing the articles of incorporation and personally participated in a “scheme to dissipate” the Church’s assets, all of which occurred in the District of Columbia. (5) By voluntarily becoming members of a D.C. non-profit corporation, they accepted all the rights, obligations, and protections that local laws provide. (6) The Court therefore ruled “that Plaintiffs have alleged sufficient facts to demonstrate that the individual Defendants have ‘purposely availed’ themselves of the laws of the District of Columbia and should, therefore, be subject to this Court’s jurisdiction” under the long-arm statute. (C) Standing. Having found jurisdiction over the Defendants, the Court then addressed the standing of the Plaintiffs to sue them, addressing two types of standing pertinent to this case, as follows: (1) Special Interest Standing. (a) A charitable trust is formed for the benefit of the public, and persons who administer such a trust are conduits through whom such benefits flow and do not derive any personal benefit from the trust assets. (b) Ordinarily, therefore, only a state official, such as the Attorney General, has standing to bring an action to enforce its terms to ensure that the trust property is put to proper use for the community at large. (c) This is because the designated communal beneficiaries consist of a large and constantly shifting class and allowing individual members to bring justiciable claims would result in recurring burdens on the trust res and multiple and vexatious law suits. (d) There is, however, a “special interest exception” to this rule where performance of the trust for the benefit of an individual is distinguishable from that for the public at large. (e) Such a “special interest” must be vindicated on behalf of “a clearly identified intended beneficiary,” not merely a possible beneficiary. (f) Also to be taken into consideration is “the nature of the challenge to the trustee’s acts.” (g) That determination turns on whether the claim flows from either (i) “an ordinary exercise of discretion” by the trustee, which is not actionable by a special interest beneficiary or (ii) an action by the trustee which constitutes a “basic change affecting the interests of the entire class” of affected beneficiaries, which may not be brought by a special interest beneficiary. (h) Put another way a beneficiary who is identified with “particularity” may sue, but one who is only identified “categorically” may not. (i) On the same “particularity” theory, more than one beneficiary may sue if its members are limited in number and they are challenging “an extraordinary measure threatening the existence of the trust.” (j) Here, the Court found that the Plaintiffs are not “members of a class of potential beneficiaries that is sharply defined and limited in number.” Rather, their complaint sounds in generalized terms, summed up in the allegation that the trustees are not acting to perpetuate the dissemination of the Divine Principle. This contention, the Court found, opens the class of beneficiaries to an “extremely broad” group. (k) Nevertheless, taking into consideration the “extraordinary measure” taken by the trustees which arguably “threatens the existence of the trust” which, without oversight, “could amount to a complete overhaul” thereof and “subvert all of its originally intended purposes,” the Court concluded that the Plaintiffs herein “individually and collectively are exactly the type of parties for which ‘special interest’ standing is reserved.” (l) The Court ruled that because the Plaintiffs are not merely members of the Church, but “are entities and individuals that have … a significant interest in … [the Church]’s dealings,” noting that they included the primary donor to the trust, principal intended beneficiaries, allegedly wrongly-ousted officers and directors, they qualified for the “special interest” exception, distinguishable from the public at large, for standing purposes. (2) Derivative Claim Standing. (a) A stockholder derivative suit is one in which one or more shareholders sue in the name of the corporation to enforce a legal right or prevent a wrong to the corporation, typically at the hands of its officers, because it has refused to do so. (b) The D.C. Nonprofit Corporation Act provides that only “members” of such a corporation have standing to bring a derivative suit and, because the corporation at issue here was organized as a non-member corporation, only the Attorney General could bring a derivative suit. (c) Further, Civil Rule 23.1 requires that a plaintiff seeking derivative standing must allege that s/he was a shareholder or member at the time of the challenged transaction. (d) In this case, none of the Plaintiff alleged that they were shareholders or members of the corporation. (e) Their argument, however, was that their cause of action was not a traditional derivative claim but a “quasi-derivative” one. (f) The threshold qualification for such a claim is that a plaintiff has a “special interest” in the governance of the corporation which gives it standing as the corporation’s “legal representative.” (g) The D.C. Nonprofit Corporation Act does not specifically identify those individuals and entities that have standing to bring a derivative claim as a “legal representative.” Although the statute does not define that term, case law requires that a “broad definition” be applied. (h) The Court, however, distinguished between a derivative action, which is brought on behalf of the corporation itself, and a person with “special interest standing,” who is seeking to secure an “individualized interest,” principles which it found to be contradictory. (i) The Court therefore ruled that Plaintiffs lack standing to bring a derivative action on the Church’s behalf and it was dismissed from the suit as a Plaintiff. (D) Contract Standing. (1) One of the Plaintiffs was the Japan-based church entity which was the largest contributor to the trust. Its cause of action was a breach of contract, alleging that the Defendants had misappropriated the funds in the trust. (2) The defense was that, absent denomination as a “restricted gift” with rights reserved, a contributor has no standing to sue over the disposition of donated funds and that only the Attorney General may sue to enforce conditions placed on a charitable trust. The Plaintiffs responded that these donations were, in fact, “restricted” to perpetuating the genuine work of the Church. (3) The Court pointed out that the relevant D.C. statute “explicitly provides settlors and persons with special interest standing to enforce the purpose of a charitable trust.” (4) Accordingly, the Court ruled that the contract-based claims “should not be dismissed on the ground that the … [major contributor] lacks standing to bring such claims.” (E) Rule 12(b)(6) Dismissal. (1) Such a motion challenges the legal sufficiency of a complaint; it is to be construed liberally so as to do “substantial justice.” (2) The only requirement under Rule 8(a) is that a “short and plain statement” of the facts alleged be set forth. (3) Although detailed allegations are not required, a complaint must set forth “more than an unadorned, ‘the-defendant-unlawfully-harmed-me’ accusation. Thus, “naked assertions devoid of further factual enhancement will not suffice. (4) The court must accept the well-pleaded allegations of the complaint as true and construe all facts and inferences in favor of the plaintiff. (5) At the same time, however, the court is not required to accept as true a mere legal conclusion couched as a factual allegation. (6) The factual allegations “must raise a right to relief above a speculative level” to that which “allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” (7) A Rule 12(b)(6) motion should be granted “only when it appears beyond a doubt that the plaintiff can prove no set of facts in support of its claim.” The Court applied these premises to the remaining claims as follows: (F) Breach of Trust. (1) The Plaintiffs alleged that Rev. Moon had created an “oral charitable trust” for the benefit of the Church and that the Japanese entity had become a settlor of the trust by means of its major contributions thereto. (2) Defendants argued that there were insufficient allegations to show even the intent to create a trust, let alone to determine the distribution of the funds therein. (3) The Court relied on the Restatement (Second) on Trusts, which defines a trust as a “fiduciary relationship with respect to property, subjecting the person by whom the title to the property is held to equitable duties to deal with the property for the benefit of another person, which arises as a result of a manifestation of an intention to create it.” (4) Under D.C. law, a trust is created only if (a) the settlor has the capacity to create a trust; (b) the settlor indicates an intention to create the trust; (c) the trust has (i) a definite beneficiary or (ii) is a charitable trust; (d) the trustee has duties to perform; and (e) the same person is not the sole trustee and the sole beneficiary. (5) There is no requirement that the trust be evidenced by a written instrument, but the creation of an oral trust, as well as its terms, must ultimately be established by clear and convincing evidence. (6) The sole challenge under these requirements was to Rev. Moon’s intent in creating the bank account and the Defendants contend that the evidence of any such intent was “wholly inadequate” in that there was no allegation of specific words or terms to that effect and that the mere creation of a bank account does not constitute the creation of a trust,
i.e., that this was merely an unacceptable “legal conclusion” by the Plaintiffs. (7) The Court rejected the Defendants’ contentions in this regard, noting that at this stage of the case, the Plaintiffs were not required to meet the “clear and convincing evidence” standard, but merely to have alleged “sufficient factual matter, accepted as true, to state a claim for relief that is plausible on its face.” (8) Moreover, a trust can be evidenced by written or spoken language “or by conduct, in light of all the surrounding circumstances.” (9) Among the circumstances that may be considered are (a) the imperative, as distinguished from the precatory, nature of the words used by the settlor to create a trust; (b) the definiteness of the trust property; (c) the certainty of the identity of the trust beneficiaries; (d) the relationship between, and financial positions of, the parties; (e) the motives which may reasonably be supposed to have influenced the settlor in making the disposition, and (f) whether the result reached in construing the transaction as a trust would be such as a person in the situation of the settlor would naturally desire to produce. (10) The Court found that Rev. Moon opened the bank account in the name of the Church, rather than in his own or another person’s name, and that the “reasonable inference” was that he did so with the intent to create a “fiduciary relationship” with respect thereto for the benefit of Church activities. (11) To the Defendants’ argument that there was no evidence that Preston Moon ever accepted the role of trustee in the first place, the Court pointed out that the pertinent D.C. statute provides that “a person designated as trustee accepts the trusteeship … if the terms of the trust do not provide a method [for doing so] … by accepting delivery of the trust property, exercising powers, or performing duties as trustee, or otherwise indicating acceptance of the trusteeship.” (12) The Court therefore concluded that the Plaintiffs had pled sufficient facts from which it could “reasonably infer” that the Rev. Moon had intended to form a trust. Although, it noted, this might not be sufficient to carry the day at trial, it was adequate at this stage of the case when allegations in the complaint and inferences drawn therefrom must be accepted as true. (G) Breach of Fiduciary Duty/Ultra Vires. (1) Plaintiffs alleged that the Defendants, as members of the Church’s board of directors, owed duties of obedience, loyalty, and care and a further duty not to take any action in contravention of its established mission and purpose, and that they breached those duties by (a) amending the articles of incorporation; (b) violating the Church’s long-standing custom and practice as to the appointment and removal of directors; (c) engaging in self-dealing by diverting assets away from that established purpose and to their personal pursuits; and (d) ceasing to use the Church’s assets to support its mission and activities. (2) The Defendants responded that this count should be dismissed because the complaint did not allege facts sufficient to establish that they owed any fiduciary duty to the Plaintiffs themselves, rather than to the Church. (3) They further argued that, by definition, ultra vires acts are those taken without authorization, whereas all those set forth in the complaint were ratified by the existing board of directors. (4) Plaintiffs responded that these actions had harmed them in their personal capacities, in addition to their interests in the corporation, because they were taken outside the authorization of the original articles of incorporation. (5) Moreover, where a charitable corporation is concerned, they argued, individual defendants may be held liable for breaches of their duty of loyalty to administer the trust in the interests of the beneficiaries. (6) The Court found that at this point is that the Plaintiffs had made sufficient allegations in the complaint, which clearly set forth the contentions that (a) the Defendants owed Plaintiffs a fiduciary duty; (b) they breached that duty; and (c) the breach proximately caused that injury. (7) The Court further found that the Plaintiffs had sufficiently pled at least one ultra vires act, which ostensibly violated a local statute which provides that no loans shall be made by a corporation to its directors or officers and those directors who vote to approve such a transaction shall be jointly and severally liable to the corporation for the amount thereof. (8) The Court’s conclusion was that the Plaintiffs therefore had legal standing to bring this claim. (H) Breach of Duty as Agent. (1) The lead Plaintiff in the case, the Family Federation, is the administrative religious entity that directs the Church worldwide, including the appointment and removal of leaders of the “providential organizations.” The Plaintiffs contended that Preston Moon was an agent of the Federation and that by acting in contravention of the purposes of the Church he had breached his fiduciary duty as an agent to the Federation as well. (2) The Defendants denied any such agency and, again, argued that the complaint did not sufficiently demonstrate same and that Preston had never consented to be such an agent. (3) Once again the Court pointed out that under D.C. law there is a two-fold test for determining the existence of an agency relationship: (a) the parties’ consent to establish it and (b) whether the activities of the agent are subject to the principal’s control. (4) Factors relevant to this two-part test are: (a) the selection and engagement of the servant; (b) the payment of wages; (c) the power to discharge; (d) the power to control the servant’s conduct; and (e) whether the work is part of the regular business of the employer. Of these factors, the element of control is the most important. (5) A court will also look both at the terms of any contract and the actual course of dealings between the parties in which “conduct or words by a person which cause the other reasonably to believe that the person desires him to act on his account and subject to his control are sufficient to establish such authority.” (6) The Court found that the “course of dealings” showed that the heads of all the Church’s providential organizations were subject to appointment and removal by the head of the Federation, a hierarchical structure that had been in place for decades, thus making him “well aware” that he served it in an agency capacity. (7) Although acknowledging that this was “an extremely close call,” the Court concluded that, however the evidence might turn out at trial, “it is undeniable that Plaintiffs have pled facts to indicate that” the Church and the providential heads “operated in accordance with … directives” from Rev. Moon and the Federation, plus bringing them, Preston Moon included, knowingly and voluntarily under the implied control thereof, and thereby making them agents subject to trial on this count of the complaint. (I) Breach of Contract. (1) Plaintiffs also alleged that Preston Moon’s violation of the original articles of incorporation breached a contractual promise in not applying the donations to the purposes for which the Church was established but diverting them to his own interests. (2) The well-settled elements for a breach of contract claim are (a) the existence of a valid contract, meaning lawful subject matter and agreement on all material terms, between the parties; (b) consideration; (c) intent to be bound by an obligation or duty arising out of the contract; (d) a breach of the contract; and (e) damages caused by the breach. (3) The Court found the Plaintiffs’ allegations on this issue were less than precise, but presumed in a light most favorable to them that they were alleging an “implied-in-fact” contract based on the long-standing course of dealings between the parties and memorialized by various correspondence between their representatives. (4) An implied-in-fact contract is a valid contract, “differing from other contracts only in that it has not been committed to writing or stated orally in express terms, but rather is inferred from the conduct of the parties in the milieu in which they dealt.” (5) Noting that the nature of the contract was “not necessarily important,” the Court found that the question on this count was whether elements of a contract and breach had been properly pled. It found that, “at this stage,” such an agreement, its violation, and resulting damages satisfactorily showed, if proven, the Plaintiffs’ entitlement to relief. (J) Promissory Estoppel. (1) The elements of promissory estoppel are (a) a plaintiff suffered an injury; (b) in reliance to its detriment on a promise by a defendant; and (c) enforcement of the promise is necessary to prevent injustice. (2) The defense was that there could be no damage to a contributor to the trust because such contributions did not carry any implication of control over them but, indeed, an abandonment of any right to reclaim them. Therefore, there could be no injustice involved. (3) The Court found that the Defendants’ argument that damages are not available under this theory to be “misplaced,” concluding that there had been “a promise which reasonably leads the promisee to rely on it to his detriment” with unavoidable injustice. (4) It concluded that “at this stage of the proceeding … that Plaintiffs have set forth facts by which the Court can infer each element of … a claim for promissory estoppel.” (K) Unjust Enrichment. (1) Under D.C. law, unjust enrichment occurs when (a) the plaintiff conferred a benefit on the defendant; (b) the defendant retained the benefit; and (c) under the circumstances, the defendant’s retention of the benefit is unjust. (2) On this count, the Plaintiffs alleged that the Defendants had retained funds for their own benefit “which in justice and equity belong to another.” (3) The Defendants repeated their argument that the contributors relinquished all claims and control over the donations and therefore they could not be deemed to have retained a monetary benefit that rightfully belongs to the Plaintiffs. (4) The Court, however, found that all the circumstances sufficiently indicated that the Church had used the trust money to fund its religious endeavors and that allegations of the misdirection of those funds, resulting in harm to the Plaintiffs, were sufficient to give rise to an entitlement to relief on a claim of unjust enrichment. (L) Conclusions. (1) The Court ruled that it had personal jurisdiction over the corporation at issue herein because it was a D.C. corporation. (2) It also ruled that it had personal jurisdiction over the Defendants under the long-arm statute. (3) It further ruled that the Plaintiffs had “special interest” standing to sue regarding the trust and also had standing under the contract claim. (4) The assertion of standing to sue under a “quasi-derivative” corporate claim, however, was disallowed. (5) The Court denied the Defendants’ motion to dismiss, finding that, at this point in the case, there was a sufficient pleading to support the establishment of a trust and one of the Defendants as the trustee, and that breach of that trust had been properly pled as well. (6) It ruled that both agency and breach of duty thereunder had been well-pled. (7) It also declined to dismiss the counts on ultra
vires, breach of contract, promissory estoppel, and unjust enrichment.
DOMESTIC RELATIONS / DIVORCE AND CHILD CUSTODY
ATTORNEY’S FEES / “NECESSARIES” EXCEPTION TO AMERICAN RULE / EFFECT OF BANKRUPTCY / CONSIDERATIONS FOR AWARD
Abstract: This Memorandum Opinion by the Trial Court is perhaps the last chapter in a long and unnecessarily contentious child custody and divorce case that dragged on for more than three years. The factual and procedural backgrounds to the case are summarized as follows: Facts: (A) Custody. (1) After being married for only about a year, the parties in this case became the parents of a son born in the District of Columbia in 2008. (2) Four months later, however, the Mother absconded with the infant to Florida. There, she refused any access by the Father and filed false ex
parte claims of domestic violence against him in local courts which kept him from seeing his son for more than 17 months. (3) When the Father filed an independent suit in D.C. Superior Court, the Mother, herself a member of the Bar here, with the aid of retained counsel, mounted a lengthy, but unsuccessful, challenge to the Court’s jurisdiction. (4) When this Court issue pendente
lite child visitation orders (five of them over the course of 13 months) on behalf of the Father, the Mother never complied with any of them. (5) After her intrinsic fraud on the Florida courts was discovered, the D.C. case became the sole remaining litigation. In November 2011, based on extensive lay and expert testimony, the Court awarded permanent custody to the Father in the child’s best interests. Limited visitation was granted to the Mother, confined to the District of Columbia. (B) Divorce. (1) The parties’ divorce case ensued at the conclusion of which all financial, property, alimony, and child support matters were resolve in April 2012. (2) The Court took under advisement the Father’s request for $700,000 in attorney’s fees. (C) Attorney’s Fees. (1) The “American Rule” is that each party in litigation bears his or her own attorney’s fees, expenses, and costs, but common law, statutory law, and case law provide exceptions that require one party to pay all or part of such financial burdens incurred by the other. (2) The Father pressed this request on any of three theories: (a) the “necessaries” rule; (b) the “bad faith” litigation rule; and (c) the pendente
lite “suit money” statutory provision. (3) The Mother argued that these principles applied only to cases wherein a prior child custody decision had been rendered and child custody and support issues were considered in a later separate proceeding. (D) Bankruptcy. (1) Just as the Trial Court was about to issue its attorney’s fees ruling, the Mother filed for bankruptcy in Florida, where she retained residence. (2) Initially, she argued that the automatic stay applied to any of the Father’s claims against her in this case. (3) The parties later agreed that bankruptcy proceeding had no effect on the Court’s authority to determine those claims – although the practical effect of her ability to pay anything remained. Rulings: The Court ruled on the issues presented as follows: (A) Necessaries Rule. (1) Factors. (a) Finding that the Mother’s “conduct through the litigation … provides compelling factual support,” the Court determined that the Father should be awarded reasonable attorney’s fees and costs under the “necessaries” exception to the American Rule. (b) This is a narrow common law exception which provides for the award of attorney’s fees and costs in situations where child custody has been previously determined through a court decree and later one party necessarily incurs counsel fees to enforce or defend the terms of that order. (c) The Mother advanced three arguments against the application of this exception against her: (i) It applies only to situations wherein there was a prior, not a contemporaneous, issuance of a custody decree and that to impose such a requirement in cases such as this one would create a virtually automatic fee-shifting rule, inasmuch as the best interests of the child is a central issue in every custody dispute. (ii) The Father failed to identify with sufficient specificity those fees and costs associated with the custody dispute, as distinguished from other issues in the bifurcated case. (iii) She is unemployed and has no assets that would enable her to pay any such award. (2) Applicability. The Court addressed these arguments respectively, as follows: (a) Although the exception originated in the Paine case (1970), wherein there was a prior custody order, the Court of Appeals held therein that generally it could be applied “when the court finds that the engagement of counsel by the … [moving party] was necessary to protect the interest and welfare of the children.” (b) The Court cited three major local appellate cases in the 40 years since Paine, in which there had been no court order, contract, or settlement as between the parties regarding child custody as a predicate, all of which allowed for the award of attorney’s fees and costs under a range of circumstances pursuant to the necessaries rule on behalf of the best interests of the child. (c) More significantly, the Court pointed out that “there was nothing ordinary about this case,” noting that the Mother’s actions had unilaterally separated the Father from their child more nearly a year-and-a-half of his infant life, had caused him to have to fight totally unfounded and fraudulent court actions in Florida, and had deliberately disobeyed its own orders for child visitation. (C) Billing Specifics. (1) The Court also rejected the Mother’s contention that the Father had failed to set forth a particularized billing request limited to the child custody issue. (2) The case law holds that such an award “is within the broad discretion of the trial court” and “no mathematic computation of time consumed multiplied by some hourly rate” is required. Not only that, the amount the Father was requesting was conspicuously less than the total amount of the legal fees and costs that he had incurred in the case overall. (D) Impecuniousness. (1) To begin with, the Court ruled that the Mother’s present ability to pay any such award “is not an essential element of the necessaries exception.” (2) Beyond that, it found that her current financial status is unclear at best. Heretofore, when she was seeking sole custody of the child, she had asserted that, as a practicing lawyer, she was earning $300,000 a year and was therefore fully capable of providing for the child. By the time of the divorce trial, however, she asserted that she was unemployed, with little or no prospect for significant income in the near future, followed by a bankruptcy filing. (3) As to her indebtedness, she testified at the divorce trial that she had received loans and monetary gifts from family and friends to pay the attorney’s fees and collateral expenses of the litigation, but had no legal obligation to repay any of it. The Court also noted that in her round-trip flights between Florida and the District, she always stayed at a four-star hotel here for each three-to-four-night visit, even though she owns a furnished condominium in the District. (4) Moreover, she has “essentially unlimited” use of her twin sister’s credit cards and lives rent-free with her sister and brother-in-law in a ten-room mansion fronting on Tampa Bay. (5) Yet, she averred that she was unable to pay the $982 monthly child support ordered by the Court. (6) Its conclusion was that she “certainly does not live like a person facing great financial pressure.” (E) Award Considerations. Once a court has determined that the necessaries exception applies, it must consider certain factors set forth by statute and case law, as follows: (1) Litigation Results. The Court found that the Father had “clearly and ambiguously prevailed in the custody litigation,” inasmuch as every local ruling was in his favor. The Father’s total request for fees and costs was more than $737,000, and the Court found that “a large majority of the total fees, and virtually all of the costs, were incurred preparing for and presenting … [the Father]’s positions” during the child custody litigation. (2) Case Difficulty. This factor includes the nature and quality of the legal services rendered and the skills of counsel. The Court repeatedly found this to have been an “unusually complex and hotly contested case” during which the Father’s lawyer “handled everything that came her way with an admirable level of efficiency, skill, and (mostly) good humor.” Her fees were both “eminently reasonable” and “substantially less” than those incurred by the Mother in the same litigation, when she had “teams of lawyers” working for her. (3) Ability to Pay. The Court must also consider the parties’ respective abilities to pay. Having already discussed the Mother’s financial situation in terms of her asserted inability to pay any award, the Court found that the Father earned approximately $145,000 annually but had debts exceeding $1.1 million, consisting mostly of loans from family members to fund the litigation. (4) Oppressiveness. In addition to considering the complexity of the litigation, a court must also consider whether either or both parties conducted it in an oppressive and burdensome manner. It repeated that the Mother’s “outrageous conduct and bad faith litigation tactics” had caused it to be “exceptionally expensive and burdensome” for the Father, resulting in total expenses to him of more than $1 million. The Court concluded that “[t]his case never would have been anywhere near as expensive or psychologically draining for … [the Father] had … [the Mother] not absconded … with the child and then behaved as she did.” (5) Child’s Best Interests. The entire basis of the award under the necessaries exception was the Court’s repeated findings that the assistance of counsel to the Father had been necessary in the best interests of the child. (F) Award. Taking all the foregoing facts and the common law, statutory law, and case law factors into consideration, the Court (1) found the Mother’s claims of inability to pay to be “unpersuasive” in light of her contrary prior testimony and (2) concluded that the same considerations entitled the Father to an award of $350,000, which was about one-half of his original request. This award, the Court pointed out, would still leave him with nearly $390,000 in fees and costs for the remainder of the overall case in the District and at least $780,000 more for the Florida litigation. [And, although the Court did not say so, this “loss” of well over $2 million consumed by these cases also drained what would have been a tremendous financial asset for the child, had these funds, or any significant part thereof, been more productively invested for his future.] The Court also noted that whatever defenses, if any, the Mother may have to this indebtedness in the bankruptcy case would be left to that Court. (G) Conclusion. The Court ordered the Mother to pay $350,000 for attorney’s fees and costs to the Father no later than August 31, 2012.
STANDING / D.C. CONSUMER PROTECTION PROCEDURES ACT
Précis: (1) In a qui tam manner, the D.C. Consumer Protection Procedures Act (CPPA) was amended in 2000, to allow “a person, whether acting for the interest of itself, its members, or the general public, to bring an action … seeking relief from the use by any person, of a trade practice in violation of a law of the District of Columbia.” (2) The amended “broad and inclusive” language does not per se require direct actual injury, but affords standing to any consumer seeking to bring an action for a violation of the law so long as that person is a member of a group that has been deprived of any statutory consumer right. (3) Nevertheless, in 2011, the D.C. Court of Appeals ruled that this amendment did “not evidence an intent … to override or disturb our constitutional standing requirement.” (4) The template for the civil procedure concept of “standing” to sue is the requirement in Article III § 2 of the U.S. Constitution that in order for a matter is to be justiciable by a court it must be a genuine “case and controversy.” (5) This means that a plaintiff must have (a) suffered some direct and immediate personal, economic, or other injury or disadvantage, commonly known as “injury in fact,” (b) that is reasonably attributable to the defendant, and (c) can likely be remedied by a favorable judicial decision. (6) Those requirements are attributable to Article III federal courts, while the D.C. Court system was set up under Article I as a “legislative court” system, established by act of Congress. (7) Technically, the D.C. Court system is not bound by the Article III “case and controversy” requirements, but throughout its history, the system has held, and operated on the premise, that this requirement is applicable to all cases at the trial level. (8) In 2011, the D.C. Court of Appeals ruled that the CPPA amendments did “not evidence an intent … to override or disturb our constitutional standing requirement.” (9) The “injury” element can be manifested in one of two ways: (a) by an actual injury of some type (“injury in fact”) or (b) by virtue of a statute creating legal rights which have been invaded (“statutory standing”). (10) To show the injury-in-fact element for standing purposes, a plaintiff “must produce evidence sufficient to withstand summary judgment that she ‘suffered actual damages because of the misrepresentations or omissions claimed to violate’” the pertinent statute. (11) Failing such a showing, a plaintiff does not have injury-in-fact standing. (12) The 2000 amendments to the CPPA do not expressly state that they apply retroactively. The traditional rule on statutory retroactivity is that a statute does not operate retroactively unless there is “clear … [legislative] intent favoring such a result.” (13) The test set forth in the case law is to “ask whether the new provision attaches new legal consequences to events completed before its enactment.” (14) If so, the new legal right does not apply retroactively. (15) If, on the other hand, as Plaintiff herein argued, the amendments “merely provide an additional remedy” to enforcement of existing rights, they do apply retroactively. (16) A trial court is not necessarily bound by an earlier ruling in a case denying the defendant’s Rule 12(b)(6) motion to dismiss for failure to state a valid claim, because at that stage of the case the court is required to construe the complaint liberally and give all reasonable inferences to the Plaintiff,” whereas on the merits the requirement is that the plaintiff must demonstrate that it was harmed (i.e., “suffered actual damages.” (17) In a CPPA case, simply asserting that the plaintiff suffered loss by paying the purchase price for the merchandise is insufficient to establish a “concrete injury” for purposes of showing standing to sue. (18) This is because “without alleging that a product failed to perform as advertised, a plaintiff has received the benefit of … [the] bargain and has no basis to recover purchase costs,” according to controlling case law. (19) Thus, a plaintiff in such a case “could not for standing purposes ‘recast their [CPPA] product liability claim in the language of contract law’” because “she suffered no harm from any misrepresentation or omission.” (20) Such a plaintiff lacks injury-in-fact standing. (21) Whether a plaintiff has “statutory standing” depends on the scope of the statute, i.e., whether it is limited to the jurisdictional boundaries of the District of Columbia. (22) Where a statute does not expressly define its “territorial reach.” Under these circumstances, if the “court cannot find from the language structure, and history of the statute a legislative intent as to … [its] territorial reach, the court must resort to judge-made choice-of-law principles, as a stand-in for statutory construction.” (23) The Restatement on Conflict of Laws sets forth four factors for determination of the situs of an injury: (a) where the injury occurs; (b) where the conduct causing the injury occurred; (c) the domicile, residence, nationality, place of incorporation, and place of business of the parties; and (d) where the relationship is centered. (24) Territoriality is a vital element in consumer protection laws; otherwise, a resident of the District of Columbia who purchased a consumer item in any of the other 50 U.S. Jurisdictions would have standing to sue here for violation of the CPPA, even though nothing occurred in the District. (25) To hold otherwise “would open our courts to any person from anywhere who decides to lodge a complaint labeled as a ‘representative action’ under the CPPA, even though that person has suffered no injury in fact related to a District of Columbia merchant’s unlawful trade practice.” (26) A plaintiff “cannot predicate her own standing on what misrepresentations and omissions other District residents received.” (27) Such a plaintiff does not have “statutory standing” under the CPPA. (28) The tort of “unjust enrichment” occurs when a person retains a benefit (typically money) which legally or equitably belongs to another, for which the equitable remedy is restitution. (29) Disgorgement of profits from a consumer purchase based on the sole allegation of “unlawful conduct” of the merchant therein, does not constitute recoverable damages under the CPPA. (30) Such a plaintiff must also show standing to bring such a suit.
Abstract: The Plaintiff in this case brought a “representative action” on behalf of herself and the general public against certain cell phone manufacturers and wireless service providers, alleging unfair trade practices under the D.C. Consumer Protection Procedures Act (CPPA). After all but one Defendant were dismissed on other grounds, the remaining Defendant, Motorola, moved for dismissal contending that the Plaintiff lacked standing to sue. The Trial Court agreed, ruling that she lacked standing due to failure to sustain any injury in fact and failure to qualify for standing under the terms of the statute. Facts: The factual and procedural backgrounds to the case are summarized as follows: (1) The Phone Purchases. The Plaintiff brought this suit under the CPPA, based on her purchase of three cell phones, two in 1999 and one in 2005, the underlying facts of which, considered in a light most favorable to her, are set forth respectively in the following sub-topics: (a) 1999 Purchases. She purchased two phones, at some point in 1999, the situs of which she does not remember. One was a Motorola brand but she does not remember the brand of the second and no records exist showing same. In March of that year, Verizon, the wireless service, provided her with a phone at no cost. She does not identify any problem with the service associated with any of the phones purchased in 1999. (b) 2000 Purchase. Verizon sold her an Audiovox brand phone from its store in the District in August 2000. (c) 2005 Purchase. It also sold her a Motorola brand phone from its store associated with a foreign car dealership in Bethesda, Maryland, in July 2005. On each purchase, she relied on information provided at the point of sale, but does not remember what that information was or reading it. (2) The Lawsuit. In 2002, she filed a “representative action” against the cell phone manufacturers and service providers, contending that (1) she was part of the protected consumer class and had suffered financial injury due to having paid the purchase price of the phones and (2) the Defendants had been unjustly enriched by the violative trade practices. Motorola, the sole remaining Defendant, moved to dismiss for lack of subject matter jurisdiction, contending that the Plaintiff lacked standing to bring the suit. Rulings: The Trial Court ruled on the issues presented as follows: (A) Standards. (1) Nothing in the current version of the CPPA evidences an intent to override or disturb the constitutional requirement for standing to sue in the D.C. Courts. (2) Standing can be manifested in one of two ways: (a) by an actual injury of some type (“injury in fact”) or (b) by virtue of a statute creating legal rights which have been invaded (“statutory standing”). (3) To show the injury-in-fact element for standing purposes, a plaintiff “must produce evidence sufficient to withstand summary judgment that she ‘suffered actual damages because of the misrepresentations or omissions claimed to violate’” the pertinent statute. (4) Failing such a showing, a plaintiff does not have injury-in-fact standing. (5) The traditional rule on statutory retroactivity is that a statute does not operate retroactively unless there is “clear … [legislative] intent favoring such a result.” (6) The test is to “ask whether the new provision attaches new legal consequences to events completed before its enactment.” (7) If so, the new legal right does not apply retroactively. (8) If, on the other hand, the amendments “merely provide an additional remedy” to enforcement of existing rights, they do apply retroactively. (9) A trial court is not necessarily bound by an earlier ruling in a case denying the defendant’s Rule 12(b)(6) motion to dismiss for failure to state a valid claim, because at that stage of the case the court is required to construe the complaint liberally and give all reasonable inferences to the Plaintiff,” whereas on the merits the requirement is that the plaintiff must demonstrate that it was harmed (i.e., “suffered actual damages.” (10) Put another way, a plaintiff in such a case “could not for standing purposes ‘recast their [CPPA] product liability claim in the language of contract law’” because “she suffered no harm from any misrepresentation or omission.” (11) Such a plaintiff lacks injury-in-fact standing. (12) Territoriality is a vital element in consumer protection laws. Whether a plaintiff has “statutory standing” depends on the scope of the statute, i.e., whether it is limited to the jurisdictional boundaries of the District of Columbia. (13) Where a statute does not expressly define its “territorial reach.” Under these circumstances, if the “court cannot find from the language structure, and history of the statute a legislative intent as to … [its] territorial reach, the court must resort to judge-made choice-of-law principles, as a stand-in for statutory construction.” (14) The Restatement on Conflict of Laws sets forth four factors for determination of the situs of an injury: (a) where the injury occurs; (b) where the conduct causing the injury occurred; (c) the domicile, residence, nationality, place of incorporation, and place of business of the parties; and (d) where the relationship is centered. (15) A plaintiff “cannot predicate her own standing on what misrepresentations and omissions other District residents received.” (16) Such a plaintiff does not have “statutory standing” under the CPPA. (17) The tort of “unjust enrichment” occurs when a person retains a benefit (typically money) which legally or equitably belongs to another, for which the equitable remedy is restitution. (18) Disgorgement of profits from a consumer purchase based on the sole allegation of “unlawful conduct” of the merchant therein, does not constitute recoverable damages under the CPPA. (19) Such a plaintiff must also show standing to bring such a suit. (B) Standing. (1) In General. The template for this concept in civil procedure is the requirement in Article III § 2 of the U.S. Constitution that in order for a matter is to be justiciable by a court it must be a genuine “case and controversy.” This means that a plaintiff must have “standing” to bring the complaint, i.e., that (a) s/he has suffered some direct and immediate personal, economic, or other injury or disadvantage, commonly known as “injury in fact,” (b) that is reasonably attributable to the defendant, and (c) can likely be remedied by a favorable judicial decision. Those requirements are attributable to Article III federal courts, while the D.C. Court system was set up under Article I as a “legislative court” system, established by act of Congress. Technically, it is not bound by the Article III “case and controversy” requirements, but throughout its history, the system has held, and operated on the premise, that this requirement is applicable to all cases at the trial level. (2) In Particular. The “injury” element can be manifested in one of two ways: (a) by an actual injury of some type (“injury in fact”) or (b) by virtue of a statute creating legal rights which have been invaded (“statutory standing”). (C) The CPPA. (1) The Amendments. The version of the CPPA in effect at the time of this case allowed “any consumer who [actually] suffers any damage a result of” an unlawful trade practice to file suit against the accused. In 2000, that language was removed from the statute, leaving the question of what constitutes “standing” to bring such a suit. This language had required “actual injury” to a plaintiff. The substituted language allows “a person, whether acting for the interest of itself, its members, or the general public, to bring an action … seeking relief from the use by any person, of a trade practice in violation of a law of the District of Columbia.” The amended “broad and inclusive” language does not per se require direct actual injury, but affords standing to any consumer seeking to bring an action for a violation of the law so long as that person is part of a group that has been deprived of any statutory consumer right. Nevertheless, in 2011, the D.C. Court of Appeals ruled that this amendment did “not evidence an intent … to override or disturb our constitutional standing requirement.” The Plaintiff herein argued that, despite having sustained no injury to herself, she still had standing to “assure compliance with the law.” (2) Retroactivity. This brought the Trial Court’s focus to that issue in this case. Although the 2000 amendment was held to grant plaintiffs such as the one in this case “statutory standing,” several of the events on which she relied for her suit occurred prior thereto, in 1999. The question thus became whether there was any legislative intent to make the amendment retroactive. The traditional rule is that a statute does not operate retroactively unless there is “clear … [legislative] intent favoring such a result.” In this instance, the 2000 amendments to the CPPA do not expressly state that they do so. The test set forth in the case law is to “ask whether the new provision attaches new legal consequences to events completed before its enactment.” If so, the new legal right does not apply retroactively. If, on the other hand, as Plaintiff herein argued, the amendments “merely provide an additional remedy” to enforcement of existing rights, they do apply retroactively. Here, the Court viewed the amendments allowing a private party acting on behalf of a new class to bring what amounts to a qui tam suit as expanding the ability to enforce existing rights and thus had a retroactive effect. Nevertheless, it was equally clear that there was nothing in the legislation that “evidenced a clear intent” favoring retroactive application. (D) Bases for Standing. As noted above, standing may be shown by either an injury in fact or by asserting standing provided by statute. The Court addressed these bases separately as follows: (1) Injury in Fact. To show this vital element for standing purposes, a plaintiff “must produce evidence sufficient to withstand summary judgment that she ‘suffered actual damages because of the misrepresentations or omissions claimed to violate’” the pertinent statute. The Defendant argued that she had produced no evidence that any of the phones she purchased failed to function properly. The Plaintiff responded by asserting that she is not required to prove non-functionability; she suffered loss, she contended, in simply purchasing the phones – a concept on which she relied based on the Trial Court’s earlier ruling denying the collective Defendants’ Rule 12(b)(6) motion to dismiss in the case in July 2010, which had received a good deal of attention in the area of communications law. In the instant memorandum opinion, however, the Court reversed itself, stating that it had “concluded, after further consideration and research, that its previous reasoning and result were faulty.” Noting that the previous ruling had been in response to a motion to dismiss, in which “the court was required to construe the complaint liberally and give all reasonable inferences to the Plaintiff,” it went on to say that the correct conclusion on the merits is that such plaintiffs must “demonstrate that they were harmed [i.e., ‘suffered actual damages’] by … alleged [material] misrepresentation” in violation of the CPPA. Simply asserting that she suffered loss by paying the purchase prices for the phones, the Court concluded, was insufficient to establish a “concrete injury” for purposes of showing standing to sue. This is because “without alleging that a product failed to perform as advertised, a plaintiff has received the benefit of … [the] bargain and has no basis to recover purchase costs,” according to controlling case law. Put another way, plaintiffs such as the one if this case, “could not for standing purposes ‘recast their [CPPA] product liability claim in the language of contract law’” because “she suffered no harm from any misrepresentation or omission.” On these settled principles, the Court concluded, the Plaintiff lacked injury-in-fact standing. (2) Statutory Standing. Whether the Plaintiff herein had statutory standing depends on the scope of the statute, i.e., whether it is limited to the jurisdictional boundaries of the District of Columbia. The Defendant argue that the record is bereft of any proof that the Plaintiff purchased any of its phones in the District.; the most she could say was that she did not remember where she purchased any of them. The Trial Court found similar local case law to be persuasive on the scope of statutory relief, but “not on all fours” with the instant case. The more refined inquiry, it found, was whether the Plaintiff herein was “within the class of individuals protected by the CPPA” because, perforce, if a plaintiff did not engage in a consumer transaction within the meaning of that statute, s/he could not have suffered any injury-in fact and was not deprived of anything to which s/he was entitled under it. Consequently, such a plaintiff lacked standing to sue. In this regard, the Court noted that the CPPA does not limit the definition of “person” to a resident of the District; nor does it provide that a “trade practice” must occur here. Indeed, the problem is that the statute does not expressly define its “territorial reach.” Under these circumstances, the Court was frank to say that when a “court cannot find from the language structure, and history of the statute a legislative intent as to … [its] territorial reach, the court must resort to judge-made choice-of-law principles, as a stand-in for statutory construction.” (a) Situs. The Court found a “strong clue” in the statute’s statement of purpose to “promote, through effective enforcement, fair business practices throughout the community.” Still, what constitutes the D.C. “community” is a vague term, allowing of those who are residents of the District, those who have “ties” to it, or perhaps those with a “governmental interest” here. The Court reviewed the Restatement on Conflict of Laws, which set forth four factors for determination of the situs of an injury: (i) where the injury occurs; (ii) where the conduct causing the injury occurred; (iii) the domicile, residence, nationality, place of incorporation, and place of business of the parties; and (iv) where the relationship is centered. (b) As Applied. Although the Plaintiff is a resident of, and works in, the District and used her cell phones here, the Court found that it was neither the place of the injury nor where the conduct causing it occurred. The only specific place set forth in the record for a purchase of a Motorola phone was in Maryland in 2005; the Plaintiff could not recall the sites of any of the other Motorola purchases. No Defendant’s principal place of business was located in the District and although Motorola does business in the District, it also does so nationwide. Therefore, the relationship was not centered here, the Court found. It concluded that the Plaintiff’s residence and use of her phone here “did not outweigh the factors favoring application of the law of another jurisdiction.” Further, the Court postulated that if a District resident vacationing in Hawaii, for example, purchased a phone there which ended up with difficulties, whether functional or legal, it would be too much of a stretch to argue that the phone company had violated the CPPA, even though nothing occurred in the District. To hold otherwise “would open our courts to any person from anywhere who decides to lodge a complaint labeled as a ‘representative action’ under the CPPA, even though that person has suffered no injury in fact related to a District of Columbia merchant’s unlawful trade practice,” the Court reasoned. The Plaintiff “cannot predicate her own standing on what misrepresentations and omissions other District residents received,” it ruled, and the record is devoid of any evidence that she herself received any such material omissions or misrepresentations from any dealer here, it found. Accordingly, it ruled that she does not have “statutory standing,” either. (E) Unjust Enrichment. This tort occurs when a person retains a benefit (typically money) which legally or equitably belongs to another, for which the equitable remedy is restitution. The Plaintiff sought restitution in the disgorgement of profits based on her sole allegation of “unlawful conduct” in the phone sales. Noting that her unjust enrichment claim was based exclusively on the same alleged violations that it had held she had no standing to assert, the Court came to the same conclusion as to that claim. (F) Conclusions. The Court held that the Plaintiff lacked either injury-in-fact standing or statutory standing to bring both the unfair trade practices claim under the CPPA and the unjust enrichment claim in equity. It therefore entered judgment for the remaining Defendant.
PROBATE LAW / ADULT INTERVENTION PROCEEDINGS
POLICY OF PROBATE DIVISION FOR ATTORNEY TRAVEL EXPENSES
Précis: (1) Under the inherent duty of Judges in the Probate Division of the Superior Court to preserve the assets of a ward of the Court, or taxpayer funds, for the purpose of compensation of court-appointed attorneys for travel time, the Court has the duty to insist upon recordation of the actual time involved, not estimates derived from map sites on the Internet or elsewhere. (2) It is the general consensus that payment of fees and costs for court-appointed lawyers should be consistent across all Divisions of the D.C. Superior Court. (3) Accordingly, expenses for travel time (a) will be allowed within the Washington Metropolitan Area, meaning the District of Columbia and its contiguous counties in Virginia (Arlington and Fairfax) and Maryland (Montgomery and Prince George’s) except to or from the courthouse, at full applicable hourly rates; (b) requests for travel time must be separately stated as to precisely where to and from, when, time involved, distance, and if not otherwise apparent, purpose; (c) application of such principles in particular cases necessarily remain subject to judicial discretion and determination of reasonableness in each case. (4) Parking fees at court are not allowed.
Abstract: This Memorandum Order, applied in three Probate Division “Adult Intervention” cases, stems from an opinion by the author’s colleague, Judge Ronald P. Wertheim, in December 2011, regarding the compensation by the Superior Court for attorneys’ travel time, aligning the policies in the Probate Division with those under the Criminal Justice Act (CJA) in the Criminal Division and those under the Council for Child Abuse and Neglect (CCAN) in Family Court. Facts: The same attorney petitioned for payment in each case -- in one as guardian, in another as counsel, and in another as successor conservator. The Judge processing his cases instructed him to renew each petition and separately state his travel time, which was otherwise melded into his time billing statements for various billed tasks. The attorney responded by attaching MapQuest printouts showing mileage and typical travel time between what turned out to be his home office and various destinations relevant to each case. Rulings: The Court ruled that it had the duty to insist on actual time, and not MapQuest estimates, under an earlier 1993 decision by the same Judge. Then, using his own technology (iPhone Maps), the Judge discovered the attorney’s home office is located in Howard County, Maryland, roughly midway between Baltimore and the District, which is located in the Baltimore-Towson Metropolitan Area. Not being within one of the contiguous counties to Washington, the home office (from which almost all the travel time was estimated) was therefore not within the Washington Metropolitan Area as defined by the CJA Plan under which travel time is allowed. Out of 158 attorneys on the Court’s March 2011 list of those available for probate appointments, 48 (30%) showed office addresses outside the District of Columbia. Only three of those (one of whom was petitioner) were outside the Washington Metropolitan Area. The Court determined that, consistent with CJA and CCAN, all Petitioner’s travel time should therefore be disallowed. It found that these attorneys “have elected to make themselves available for D.C. probate appointments even though they are far enough away from Washington to be outside its defined and/or recognized metropolitan area.” There is nothing wrong with this, the Court noted; “it is just that lines have been identified beyond which these lawyers must be responsible for their own travel time and expense, and it is not fair or reasonable to charge an estate or the Guardianship Fund for it.” Indeed, the Court pointed out that it had disallowed travel time in two recent fee petitions where the lawyers had offices in the District of Columbia, but sought compensation for travel to/from satellite offices in Anne Arundel County, Maryland, also outside the Washington Metropolitan Area. The CJA Plan permits pre-approval for travel destinations outside the metropolitan area. However, the Court concluded that the Plan does not reasonably contemplate the situation here where almost all the repeated travel segments begin or end outside the metropolitan area (thus requiring extended travel within the metropolitan area) simply because that is where counsel has his office.” Conclusions: (1) In the Matthews case herein, $1,332 in travel time (55% of the total fee request, for 12 guardian visits to the subject from the attorney’s home office) was disallowed. (2) In the Parker case, $96 in round-trip travel from the home office to the now-deceased subject (9% of the total claim for a month-and-a-half as counsel) was disallowed. (3) In the Cooper case, 41.1 hours’ travel time was disallowed ($11,302.50 at $275 per hour -- 20% of the total claim from the subject’s complicated estate). (4) The Court also ordered that no further pending fee petitions by the attorney shall be paid until he files a supplement in each case that eliminates any and all travel to/from his home office, and “stating he has complied with this order.”
METHOD OF COMPENSATION FOR COURT-APPOINTED ATTORNEYS
Précis: (1) There is nothing improper in a Judge’s making rulings on routine motions via handwritten notes in the margins thereof, rather than issuing a formal order. (2) It is a lawyer’s responsibility to know, or to look up, the law controlling the subject matter of a submission to the Court. (3) Where the submission is for payment for court-appointed work, case law dating back to 1993, holds that rounding of time in fee requests greater than one-tenth of an hour will result in reduction of compensation and will not be reversed. (4) The controlling case also applies to the attorney’s selection of software for billing purposes. (5) The lack of a party’s objections to fee petitions in the Probate Division is of no import, as the subject is usually impaired, and lawyers are loath to object to another’s fees. (6) This is especially so when the fees are sought from the taxpayers where the Guardianship Fund is the source of payment and there is little incentive to object. (7) A Judge is required to approve fees, opposed or not, and that is meaningless unless it also implies the ability to reduce unreasonable fees. (8) It is not the Court’s obligation to justify each dollar or hour deducted from the total submitted by counsel, but counsel’s burden to prove and establish the reasonableness of each dollar and each hour, above zero, requested. (9) This is a part of the function of approving (or disapproving) fees, since fairness requires comparison and consistency with the myriad of other fee requests a Judge sees. (10) Reduction in fees requested can include work actually performed but which is exaggerated or unnecessary: One can spend more time with a subject than is necessary; one can overly prepare for a simple court hearing; one can review or research law that should already be known; and one can review records in more detail than is necessary. (11) A Judge who sees an attorney “prepare” exactly two hours for any and every court hearing, or visit a subject for exactly one hour every time, can justly be suspicious that recording is inaccurate or that “padding” is occurring. (12) Probate Judges will continue to be vigilant about billing for what is deemed secretarial overhead, which also often manifests itself in inappropriate billing for paralegal time. (13) Making copies, stuffing envelopes, and traveling to the Post Office or nearest mailbox are all clearly administrative overhead which is included in the significant hourly rate (even $90 from the Guardianship Fund) that attorneys charge and are paid. (14) This is true whether the Fund is the source of payment, or the subject’s estate, which the intervention statute requires should be preserved as much as possible. (15) Travel time to and from court and parking fees at court are not allowed.
Abstract: A Trial Judge whose opinion on sentencing to jail a pregnant cocaine addict has been used to teach whole law school classes, United States v. Vaughn, 117 D.W.L.R. 441 (Mar. 7, 1989), thoroughly explains in this case how a Judge evaluates attorney fee petitions. Facts: The factual background to the case is summarized as follows: An attorney whose fees as Guardian Ad Litem were reduced by the Court in two Probate Division intervention cases (by $540 and $388.80 respectively) filed motions to reconsider. In a textbook demonstration of how not to confront a Judge’s rulings that he wanted to change, he complained that the Judge “scribbled” his reasons on the original orders rather than write a “multiple page, detailed memorandum” that “was more instructional than critical.” He also complained about travel time inconsistencies among Probate Judges “regarding what the lawyers on the panel can bill for and what we cannot bill for,” and he requested guidance because he and “numerous lawyers ... complain and grumble about the process in the shadows and amongst themselves.” He added, in complaining about cuts for what were essentially secretarial or administrative functions, that “[m]aking copies, stuffing envelopes and traveling to the Post Office or nearest mailbox are all work done on behalf of the client to initiate [or conclude] the case.” Finally, the attorney complained that “[n]ot a single interested party to [each] case objected to [the attorney’s] Petition for Compensation. Why should the right to object by interested parties be replaced by a Judge who is looking at the case from a distance and is not actually involved in the case?” In the second case, where the motion for reconsideration was filed six days later than the first, the attorney apparently discovered two dispositive earlier rulings by the same Judge. He complained that the Judge did not cite them in his “scribbling,” and says that one ruling is “arbitrary and capricious and should be reversed,” adding that “my billing software rounds off and bills in 10 minute increments.” Rulings: (A) Marginal Notes. The Court made no apology for explaining its rulings by handwriting in the margins. With dozens of fee petitions per week that the Probate Motions Judge has to handle, there is simply not enough time to write a full and complete Memorandum Order for every petition for compensation that requires cutting. (B) Responsibility to Know Settled Law. It is a lawyer’s responsibility to know, or to look up, the law, as the attorney apparently eventually did by the time of his second motion for reconsideration. Where this type of billing is concerned, case law dating back to 1993, holds that rounding of time in fee requests greater than one-tenth of an hour will result in reduction of compensation and will not be “reversed.” The controlling case has been reliably followed by the vast majority of attorneys and Judges for many years, and has been in the D.C. Code annotations under § 21-2060 for almost two decades. That decision also dismisses the attorney’s selection of software, and the reasoning will not be repeated. (C) Lack of Objections. The lack of objections to fee petitions is of no import, as the subject is usually impaired, potentially opposing court-appointed counsel have no more time to object than a Judge does to write, and lawyers are loath to object to another’s fees. This is especially so when the fees are sought from the taxpayers where the Guardianship Fund is the source of payment -- there is little incentive to object. A Judge is required to approve fees, opposed or not, and that is meaningless unless it implies, also, the ability to reduce unreasonable fees. Citing cases, the Court ruled it is not the Court’s obligation to justify each dollar or hour deducted from the total submitted by counsel, but counsel’s burden to prove and establish the reasonableness of each dollar, each hour, above zero. (D) Viewing the Case “From a Distance.” It is a part of the function of approving (or disapproving) fees, since fairness requires comparison and consistency with the myriad other fee requests a Judge sees. That can include an attorney who does the work he bills for, but the work is exaggerated or unnecessary: One can spend more time with a subject than is necessary; one can overly prepare for a simple court hearing; one can review or research law that should already be known; and one can review records in more detail than is necessary. A Judge who sees an attorney “prepare” exactly two hours for any and every court hearing, or visit a subject for exactly one hour every time, can justly be suspicious that recording is inaccurate or that “padding” is occurring. (E) Secretarial Work. Probate Judges will continue to be vigilant about billing for what used to be secretarial overhead. It often manifests itself in inappropriate billing for paralegal time. “Making copies, stuffing envelopes, and traveling to the Post Office or nearest mailbox” are all clearly administrative overhead that is included in the significant hourly rate (even $90 from the Guardianship Fund) that attorneys charge and are paid. This is true whether the Fund is the source of payment, or the subject’s estate, which the intervention statute requires should be preserved as much as possible. (F) Travel Time. The Judge cited a 2011 opinion by a colleague in the Probate Division, suggesting that it provides guidance for petitioners and “the numerous [other] lawyers” whom he says “complain and grumble in the shadows.” In any case, a 1992 opinion has long held that travel time to and from court and parking fees at court are not allowed. (G) Conclusion. The Court, having deliberated at length, granted the motions to reconsider, but denied the additional payments requested from the Guardianship Fund.
DOMESTIC RELATIONS LAW
CHILD CUSTODY AND SUPPORT / REBUTTABLE PRESUMPTION IN FAVOR OF JOINT CUSTODY / EXCEPTION
Précis: (1) The overarching standard for all cases concerning child custody is the “best interests of the child.” (2) D.C. statutory law “articulates a clear legislative preference for joint custody in most circumstances and creates a rebuttable presumption that joint custody is in the child’s best interest, except where a judicial officer has found, by a preponderance of the evidence, that an intra-family event, as [statutorily] defined, has been committed or that an active child abuse or neglect or parental kidnapping has occurred.” (3) Where a judicial officer has made such a finding, however, “the statutes articulate an equally clear legislative preference against joint custody and create a rebuttable presumption that joint custody is not in the child’s best interest.” (4) Overall, “the statutory scheme affirmatively disfavors a request for custody or visitation made by a parent found by a judicial officer to have committed an intra-family offense, and [a] such a parent may be awarded custody only if the court supports its decision with a written statement specifying the factors and findings on which the court has relied, and [b] such a parent may be awarded visitation only if the court finds that [i] the child and the custodial parent can be adequately protected and that [ii] visitation will not endanger the child or [iii] significantly impair the child’s emotional development.” (5) Thus, a court must exercise “considerable caution” before granting custody or visitation to a parent found to have committed in intra-family offense.” (6) Under the relevant statute, a court is required to consider at least the following factors in a child custody case: (a) the preference of the child, where practicable; (b) the wishes of the child’s parent(s) as to the child’s custody; (c) the interaction and interrelationship of the child with his or her parents, siblings, and any other person who may emotionally or psychologically affect the child’s best interest; (d) the child’s adjustment to his or her home, school, and community; (e) the mental and physical health of all persons involved; (f) any evidence of a statutorily-defined intra-family offense; (g) the parents’ capacity to communicate and reach a shared decision affecting the child’s welfare; (h) the parents’ willingness to share custody; (i) the prior involvement of each parent in the child’s life; (j) the potential disruption of the child’s social and school lives; (k) geographic proximity of the parental homes as related to the practical considerations of the child’s residential schedule; (l) the demands of parental employment; (m) the number and age of children; (n) the sincerity of each parent’s request; (o) parental ability to financially support a joint custody arrangement; (p) the impact on receiving any public assistance programs; and (q) the benefits of the parents. (7) Where an intra-family offense is a factor in determining child custody, the pertinent statute requires that a judicial officer must first find by a preponderance of the evidence that such an offense has occurred, before considering it. (8) If, however, a court awards custody to a parent found to have committed an intra-family offense, it must set forth specifically in its order the reasons for so doing. (9) Even where negative findings are made as to one parent or the other, this does not necessarily reflect the statutory presumption in favor of joint custody. (10) Other factors that a court may take into consideration include, but are not limited to, (a) the state of the mental and emotional health of a parent; (b) the ability of the parent to maintain close personal relationships; (c) a parent’s record of mendacity; (d) a parent’s record for honesty and integrity; (e) compliance with prior court orders; and (f) negative attitudes toward the other parent.
Abstract: This is yet another bitter and litigious divorce and child custody case in which one of the parents – in this case the Mother – talked and acted her way out of the goal which she most desired, physical and legal custody of her infant child when, in a particularly frank analysis of her conduct, the Trial Court awarded same to the child’s Father. Facts: The factual and procedural backgrounds to this case are summarized as follows: (1) The Parties’ Relationship. The Plaintiff is a 38-year-old law school graduate who has lived in the District of Columbia since 2000, where he is a partner in an entity engaged in infrastructure investments abroad, primarily in the Middle East. The Defendant, also a law school graduate, lives in Tampa, Florida, where she practices law. The couple first met in September 2007, after which they began dating. In January 2008, they had sexual relations at the Plaintiff’s home – an encounter which the Defendant later described as not entirely willing on her part – shortly after which he left on a business trip to the Middle East. A few weeks later, the Defendant learned that she was pregnant and called the Plaintiff, who was then in Pakistan, and so informed him. When he returned to the District, they decided to carry the pregnancy to term and to get married as soon as they could arrange a wedding. They were married in April 2008, and their child was born in October in the District. During that time, however, their relationship was contentious and the tension only increased after the birth of the child. They spent some time in Tampa Florida, with the Mother’s parents, but the Father could not remain there long, due to his work in the District and his business travels abroad during that period. Finally, by early March 2009, the parties’ arguments at their home in the District had become so bitter and emotionally abusive that one evening the Mother left the house, taking the four-month-old infant with her. The next day, without informing the Father, she flew to Tampa with the child. From that point on, the parties were at total divergence as to where the infant should live, whether with the Mother in Tampa or whether she should move with him back to the D.C. metropolitan area, even while the parents remained separated. The Mother’s temperament and attitude in the ensuing months, varied dramatically, sometimes inviting the Father’s attentions at other times excoriating him as a horrible husband and Father. (2) The Competing Custody Suits. (a) Ultimately, on March 30, 2009, a little more than a year after the Mother had left the District with the child, the Father filed a complaint in D.C. Superior Court seeking pendente lite and eventually permanent custody of the child, alleging that the Mother had taken him from the District without his consent and had since refused to return the child or to disclose his precise whereabouts. Despite several efforts, however, because he did not know her address, the Father was unable to effect service upon her. (b) Fully aware that the D.C. case had been filed, a week later the Mother filed for divorce and custody in Tampa. Learning of that case, the Father filed an emergency motion for pendente lite custody in D.C. After an ex parte emergency hearing, the Superior Court granted him temporary sole custody of the child until a status hearing to be held on June 24, 2009. The week after the emergency hearing, the Father was able to effect service of this suit upon the Mother in Tampa via the local Sheriff’s Office. (c) The next day, April 18, 2009, only 35 days after she had absconded from the District with the infant, the Mother went back to court in Tampa and filed an ex parte domestic violence petition, seeking a stay-away order against the Father. In that petition, as a predicate for jurisdiction, she falsely swore that she had been a resident of the State of Florida for more than six months previous and that she needed protection against the Father due to his domestic violence against her and the child, which, she alleged, included daily drunken rages, screaming obscenities in the presence of the child, ripping the child from the Mother’s breast while nursing, violent infant-shaking, child sexual abuse, exposure of the child to pornography, assault on both of them with objects, threats to kill both with a handgun, and threats to take the baby to the Middle East, where he had substantial landholdings in three countries. Despite a specific question in the application form, she omitted notifying the Florida of the D.C. matter as a “pending case involving the parties,” even though the temporary custody order in favor of the Father had already issued. Based on the information, or lack thereof, provided by the Mother, the Florida Court issued its own ex parte temporary stay-away order against the Father, granting the Mother sole custody, barring the Father from any contact with the child, and, at the Mother’s specific request, prohibiting the removal of the child from the State of Florida, all pending a further hearing, scheduled for April 28, 2009. (d) The same day that she filed her domestic violence petition in Tampa, the Mother also notified D.C. Child and Family Services of her allegations of the Father’s abuse of the child, even though no such allegations had ever been made against him (which, following an investigation, the D.C. agency dismissed). (e) For more than a year following the issuance of the Florida Court’s temporary order, the Mother returned to that Court repeatedly and filed additional emergency petitions seeking further ex parte domestic violence orders against the Father, all made under oath, even though there was no record that the Father had even been in the jurisdiction during that time. Regrettably, the Florida Court continued to issue orders against the Father, without hearing any live testimony, receiving any evidence beyond the Mother’s sworn written statements in support of her repetitive petitions, or making any findings that the Father had committed any acts of domestic violence. Then, ironically, in June 2010, more than 14 months after the issuance of its first order, the Florida Court finally determined that it lacked jurisdiction over the Mother’s domestic violence actions against the Father and dismissed all of her allegations, and its concomitant orders, with prejudice. (f) Meanwhile at the end of April 2009, while the Mother was still pursuing her groundless domestic violence claims against the Father in Florida, she filed a motion to dismiss his custody case in the District, on the grounds that the Superior Court lacked jurisdiction to make an initial child custody determination or, alternatively, that Florida was a more convenient forum for the litigation. In May of that year, the Superior Court denied her motion and ruled that all further proceedings in the case would be conducted here. (g) Subsequent to that ruling, the Superior Court issued several pendent lite orders granting visitation to the Father, who had not seen the child since March 2009, when the Mother removed him to Florida. Despite three such orders that the Mother bring the child to the District for visitation with his Father, she never complied with any of them, ironically citing the Florida Court’s order which she had falsely obtained, prohibiting the removal of the child from that State. By August 2010, the Superior Court Judge then presiding over the case had come close to the end of her patience with the situation and ordered that the Court expected full compliance with each of its orders and that failure to do so would open any such party to the full range of sanctions available to it. The Mother subsequently complied with all orders to bring the child to the District for visitation with the Father. In September 2010, the Court heard extensive evidence from a psychologist presented by the Mother, who was of the opinion that the Father exhibited “clear sociopathic tendencies,” and who cautioned that the process of increasing the length and frequency of the Father’s visits with the child should be gradual, in order to avoid damaging the primary attachment between the child and his Mother. In subsequent pendent lite orders, the Court continued primary physical custody of the infant with the Mother, but ordered increased visitations with the Father, all to take place in the District. Meanwhile, pursuant to the Court’s urgings, the Mother took steps to dismiss all remaining legal matters against the Father in Florida, for the purpose of enabling him to travel there to visit the child without fear of legal repercussions. (h) As the parties’ animosity toward each other began to decrease, the Court ordered and independent psychological evaluation of all concerned. The psychologist reported that the child had developed “strong and positive attachments to both his parents and views each parent as a source of support, comfort, and safety.” He specifically found that the Father “has superior parenting abilities …, is far healthier psychologically, … and has a much greater understanding of, and respect for, the importance of a child’s ability to maintain substantial relationships with both parents.” In particular, he found that the Father “is a caring, concerned, and nurturing parent who exhibits good judgment, sets appropriate limits, and promotes the child’s independence” and that he was “dealing as rationally and productively as one could expect, given the incredible upheaval that has occurred in his life.” He was particularly impressed by the Father’s “willingness to foster an ongoing relationship between … [the Mother] and the child.” In stark contrast, he found that the Mother “has difficulty ‘reading’ the child’s needs, fails to set limits, and treats the child in a variety of ways (such as allowing the child to sleep in her bed with her every night) that will not advance the child’s growth toward independence.” Moreover, he found her to be “an illogical thinker who has a profoundly distorted view of … [the Father] and of much of the world around her.” He further faulted the Mother for her “negative and destructive comments … about … [the Father] in front of the child in the course of the evaluation,” which led him to believe that she “could not be counted on to promote the child’s relationship with” his Father. Although acknowledging that there were some disadvantages involved, the psychologist recommended that the Father be granted sole legal and physical custody of the child (with an obligation to consult with the Mother on all major decisions affecting his health, education, and general welfare), and with the Mother having reasonable visitation, to be supervised by a neutral mental health professional in order to preclude any additional alienating comments about the Father and to prevent her from absconding with the child again. (3) The Divorce Suit. Meanwhile, in May 2010, which was 14 months after the parties’ separation, the Father had filed a complaint for absolute divorce in Superior Court. Ironically, a month later the Mother filed a motion to dismiss on the grounds of improper service of process and lack of subject matter jurisdiction, which the Court denied. Ultimately the case was certified on motion to the Domestic Relations I calendar, where it came under the aegis of the author of this Memorandum Opinion. With the consent of the parties, the Court determined to bifurcate the custody and divorce issues, giving priority attention to the former in a separate proceeding, which ultimately took 18 trial days over a six-month period. Rulings: The Court ruled on the custody issues presented as follows: (A) Standards. (1) The overarching standard of this, and all, cases concerning children is the “best interests of the child.” (2) D.C. statutory law “articulates a clear legislative preference for joint custody in most circumstances and creates a rebuttable presumption that joint custody is in the child’s best interest, except where a judicial officer has found, by a preponderance of the evidence, that an intra-family event, as [statutorily] defined, has been committed or that an active child abuse or neglect or parental kidnapping has occurred.” (3) Where judicial officer has made such a finding, however, “the statutes articulate an equally clear legislative preference against joint custody and create a rebuttable presumption that joint custody is not in the child’s best interest.” (4) Overall, “the statutory scheme affirmatively disfavors a request for custody or visitation made by a parent found by a judicial officer to have committed an intra-family offense, and [a] such a parent may be awarded custody only if the court supports its decision with a written statement specifying the factors and findings on which the court has relied, and [b] such a parent may be awarded visitation only if the court finds that [i] the child and the custodial parent can be adequately protected and that [ii] visitation will not endanger the child or [iii] significantly impair the child’s emotional development.” (5) Thus, a court must exercise “considerable caution” before granting custody or visitation to a parent found to have committed in intra-family offense.” (B) The Statute. Under the relevant statute, a court is required to consider at least the following factors in a child custody case: (1) the preference of the child, where practicable; (2) the wishes of the child’s parent(s) as to the child’s custody; (3) the interaction and interrelationship of the child with his or her parents, siblings, and any other person who may emotionally or psychologically affect the child’s best interest; (4) the child’s adjustment to his or her home, school, and community; (5) the mental and physical health of all persons involved; (6) any evidence of a statutorily-defined intra-family offense; (7) the parents’ capacity to communicate and reach a shared decision affecting the child’s welfare; (8) the parents’ willingness to share custody; (9) the prior involvement of each parent in the child’s life; (10) the potential disruption of the child’s social and school lives; (11) geographic proximity of the parental homes as related to the practical considerations of the child’s residential schedule; (12) the demands of parental employment; (13) the number and age of children; (14) the sincerity of each parent’s request; (15) parental ability to financially support a joint custody arrangement; (16) the impact on receiving any public assistance programs; and (17) the benefits of the parents. The Court applied all the foregoing standards and considerations to the respective parties under the following topics: (C) Allegations of Domestic Violence. Because of the prominence of any commission of an intra-family offense in the statutory considerations, the Court addressed this issue separately. It first addressed the question of whether the domestic violence orders issued by the Florida Court “constituted or contained a judicial finding of an intra-family offense or its functional equivalent,” finding that “[t]he answer is certainly no.” The D.C statute requires that “a judicial officer has found by a preponderance of the evidence” that such an offense has occurred. In making this determination, the Court considered the evidence previously presented in both the Florida Court and that presented before this Court. (1) Florida Court. As to all Florida proceedings, the Court found that “no judge … [there] ever found by a preponderance of the evidence (or any other standard) that … [the Father] committed in intra-family offense, or any act of domestic violence, against either … [the Mother] or the child.” Indeed, it pointed out that the only particularized finding by a Florida Judge overtly noted that he could not “help but wonder if these attempts by the Petitioner are, in fact, closely aligned with her goals in terms of any outstanding dissolution and custody action regarding this child.” Thus, the Court herein concluded that there was no basis for such a finding in the Florida record. (2) D.C. Court. The Court then turned to the evidence presented at the custody hearing here to determine whether an intra-family offense had ever occurred. Although it found that the parties had engaged in numerous heated arguments that were “demeaning, hurtful, and otherwise emotionally abusive … by both parties,” it found nothing about them that was criminal, either via threats or actions. It based this conclusion on seven specific findings: (a) The Mother never made any contemporaneous or even near-contemporaneous reports of any of the Father’s alleged criminal acts. Indeed, it was not until the day after she had been served with his D.C. custody complaint and this Court’s order granting him temporary custody of the child that she went into court in Tampa for the first time to allege that she and the child had been the victims of domestic violence. The Court found that the Mother had a “clear motive to fabricate at the time she first made the allegation” in order to avoid the consequences of the temporary custody order was what prompted the allegations of domestic violence. Surely, it reasoned, if these actions had been perpetrated to the degree and with the frequency as alleged, the Mother would have made prompt and proceeded complaint to the appropriate authorities before then. (b) Using strong language, the Court found the Mother’s domestic violence filings to be “part of an ever-expanding set of sensational accusations against … [the Father] that are so numerous, so extraordinary, and in the … [psychologist]’s view, so distorted that they defy any common sense view of reality.” (c) It also noted that, with only one exception (the Mother’s twin sister, whose testimony it did not credit), no witnesses to any of this conduct had ever been forthcoming. (d) There was also no physical, scientific, photographic, medical, or other documentary evidence supporting the Mother’s allegations, something the Court would have expected to have been produced to show bruises, scratches, or other physical injury inflicted in the course of the Father’s many alleged violent and armed assaults against her and the child. (e) The Court found particularly suspicious the Mother’s version of the allegedly “non-consensual” and sexual interlude which she believed had resulted in the conception of the child. The Court found that he was belied by her “romantic and sexually suggestive” e-mails to the Plaintiff immediately after the incident. (f) The Court found it compelling that “every judicial officer who has presided over an adversarial proceeding at which … [the Mother]’s allegations of domestic violence have been addressed, has found the evidence supporting the allegations deficient.” The Court therefore, concluded that her allegations were all false, a conclusion which it found “raises serious concerns not only about … [the Mother]’s credibility as a witness, but also about her lack of integrity, her alienating behavior, and her lack of commitment to the fostering of a positive relationship between … [the Father] and the child.” (g) Finally, the Mother’s allegations of child abuse were found baseless by the child welfare agencies in both Florida and the District and were dismissed. This record, the Court concluded, nevertheless “leaves fully in place of rebuttable presumption favoring joint custody and it turned to the particular evaluations mandated by the statute to determine whether that presumption had been rebutted. (D) Custody Determination. The Court applied the above-listed statutory factors to be considered in the award of custody as follows: (1) It agreed the child has “constructive relationships” with both parents and their respective families, although it noted that this was not surprising, as the infant had spent 17 of the 21 months of his life with his Mother after she had absconded with him in March 2009. (2) It agreed with the psychologist that the Father had the “superior parenting skills,” which included his having “more caring, concerned, and nurturing interactions with the child” and exhibiting the “consistent exercise of good judgment in setting limits and otherwise directing the child’s activities in ways likely to foster self-confidence and independence … and is more rational and logical thought processing.” (3) In contrast, the Court expressed concern about the Mothers “illogical thinking and extreme distortions relating to” the Father, which it found “amply supports the view that … [she] suffers from severe psychological deficits.” These conclusions were supported in the record, it found, by evidence of her abscondance with the child and keeping his presence secret from his Father for months, her attempts to present a profoundly distorted view of him to the child, her intentional fabrication of what she knew to be false allegations of domestic violence. The Court noted that the testimony during trial showed that she had had three or four failed marriage engagement before she met the Plaintiff, and was terminated from at least four consecutive and climate positions within the first five years following her graduation from law school. (4) The Court rejected the evaluation of the Mother’s psychological expert that the Father exhibits “clear sociopathic tendencies,” particularly in view of the fact that he had never performed a psychological evaluation of (or even met) him. Although the Father’s personal record, to be sure, was well less than perfect, including drinking bouts and a lack of forthcomingness in certain areas, the Court found that his “challenges in managing his interpersonal relationships … [are] mild in comparison to those that so thoroughly limit” the Mother. Her entire inter-personal history demonstrated, in the Courts view, that she “is a psychologically unstable person whose unsteady moral and ethical compass and apparent lack of awareness of her own shortcomings make it impossible for her to successfully navigate her surroundings in a consistent and sustainable way.” (5) It was clear to the Court that, at the present time, the parties “are unable to communicate with each other effectively or to make joint decisions affecting any aspect of the child’s welfare.” The Court therefore concluded that the rebuttable statutory presumption in favor of joint custody had, in fact, been rebutted. That being so, it then determined the primary custody should be the Father. This decision was based on the Court’s findings that he “clearly understands the importance of the child’s ability to maintain a close relationship with … [the Mother] into the future” and “would shield the child from his personal feelings about … [her]… and would take all steps necessary to foster a meaningful relationship between the child and his Mother.” (6) The Court frankly stated that it “lacks anywhere near the same level of confidence in” the Mother. It found that throughout she had “acted in utter disregard for the child’s interest in maintaining a meaningful relationship with” his Father. In addition to her absconding with and keeping the child away during that time, the Court listed the following examples as the bases of its misgivings: (a) The child was a “second” (i.e., “II” not a “Jr.”), having the first, middle, and last names of his Father. At some point during the child’s presence in Florida, the Father learned that the Mother and her parents were calling the boy by another first name, including placing it on the icing on his first birthday cake, and allowing him to call his uncle “Dad.” The Court found this to be “as clear a statement to the child (and everyone else) as one can imagine that … [she] believes the child’s connection to his Father to be so negative that it should be severed” and was yet another example of her “aggressive campaign over several years to cut … [him] out of the child’s life.” (b) The Court noted that the Mother had “been unable or unwilling to temper her alienating behavior even during the course of the litigation, a period in which one would expect … [her] to have been on her very best behavior,” once again overtly demonstrating an “obvious lack of awareness (or at least of any concern) that such conduct was severely detrimental to the child.” (7) The Court’s evaluation of the prior involvement of each parent in the child’s life was also unfavorable to the Mother. Although during their enforced separation, the Father had continually expressed great interest in the child, the evidence at trial showed that, although the Mother had gone to great pains to create and prolong that separation, she delegated a substantial portion of the child’s care to her sister and several nannies and other assistants whom she employed for that purpose. (8) The 800-mile linear distance between the parties’ respective residences remained a factor. Ordinarily, under these circumstances, although a Court might consider regular visitation for the non-custodial parent not to be feasible, the Court decided in favor thereof based upon the psychologist’s recommendation and the representation of the Mother’s Counsel in open court that she would move to the District if the Court awarded primary custody to the Father. (9) The Court found that the parties’ speculative employment situations not only did not constitute any impediment to their mutual ability to help care for the child, but also, due to their highly flexible work schedules and significant incomes, would facilitate it, particularly if the Mother did remove back to the District. The Court further noted that their respective incomes were supplemented by their respective families, all of which provided sufficient funds for their recommended participation in therapy. (10) In addition to the intra-family violence issue, the Court found the following factors to have no impact on its decision: the wishes of the child; the earnestness of the parents to have custody; disruption of a social and school life; age and number of children; any impact on public assistance programs; and the benefit to the parents. (11) The Court frankly stated that perhaps its greatest reason for not awarding custody, and for not awarding joint custody, to the Mother and restricting her visitation with the child, was her long record of the lack of honesty and integrity, not only in this case but also in other aspects of her life. In a withering series of observations, it found that her “false domestic violence petitions (and her equally false testimony at trial relating to many of the same allegations) are merely the most stunning examples of … [her] willingness to say anything, even under oath, to advance her own personal interests at the expense of … [the Father], the child, and others.” The Court pointed once again to her prevarication regarding the nature of the sexual interlude that resulted in her pregnancy, which it found “was so patently incredible, and so obviously fabricated, that it raised serious concerns in the Court’s mind not only about … [her] credibility as a witness, but also about what appears to be her fundamental lack of integrity.” This finding was punctuated by evidence at trial that showed that she had made significant omissions and misrepresentations on her resumé relating to her experience as a law student and as a young lawyer. Overall, the Court found that the evidence established that she “has extreme personal deficits in terms of honesty and integrity” and “appears to lack any appreciation or respect for the importance of … [those character traits] in interactions with her family, employers, and others with whom she comes in contact.” Sadly, the Court concluded that it “fully expects that … [her] pattern of misrepresentations about virtually everything, including the most important aspects of her life, will continue indefinitely.” Although the evidence showed that the Father, too, had credibility lapses, the Court found that he “is much more honest than … [the Mother], and he conducts himself far greater integrity.” These factors are important, the Court asserted, because “it is essential that the impressionable young child at the center of this case the exposed to a primary parenting figure who will provide the child with the best available role model of honest and ethical dealings with others.” (12) The Mother’s mendacity, the Court found, was compounded by her inability to maintain important relationships. In addition to her several broken marriage engagements and her tendentious marriage, the evidence also revealed a volatile relationship with her twin sister (even though the sister had helped her keep the child away from the Father), a seemingly complete loss of contact with a brother, and her termination from employment in government, institutional, and law firm positions – all within the first five years of her graduation from law school. The Court found it highly significant she blamed each and every termination on unlawful discrimination or on matters beyond her control. The Court found that it was “very important for the child to have as his primary parenting figure a person who is capable of maintaining long-term relationships with the family, employers, and others and who is at least open to taking responsibility when such relationships end badly.” Once again, the Court concluded that the Father was “far better situated … to serve as a positive role model in this regard.” (13) The capstone of the Court’s rationale for excluding the Mother from any type of custody was her “very poor record of compliance with court orders in this case, except when she understood that she faced the likelihood of enforceable contempt citation.” She had flouted the temporary custody orders for more than a year by filing false domestic violence petitions in Florida, making special requests in those petitions to prohibit the removal of the child from that State, failed to participate in paternity testing as ordered by this Court, refused to pay her 50% share of the court-ordered psychologist’s investigation, and only came into compliance after the threat of sanctions for her dilatory tactics, the Court found. (E) Conclusions. The Court issued the following conclusions: (1) Based on the foregoing findings, and the recommendations of the psychologist, it is in the best interest of the child for his Father to be his sole legal and primary physical custodian, effective immediately, because of his “greater parenting skills, judgment, and integrity.” (2) Based on the representation that the Mother would soon be moving to the District, her visits with the child were to be supervised for an initial period of at least four weeks following the transition to ensure that she “does not abscond with the child or make additional negative comments about … [the Father] in the child’s presence.” (3) The Father was required to consult with the Mother on all significant issues affecting the child’s health, medical care, education, religion, and general welfare, considering her views carefully and in good faith, but he has final decision-making authority over all such issues, except when the child’s immediate needs must be addressed whenever he is on a visit with her pursuant to this order. (4) The Mother was granted an entitlement to all information regarding the child’s health, medical care, education, and religious upbringing, to the insured by execution of all releases and authorizations necessary to ensure same. (5) The parties were required to provide each other with copies of all health insurance cards and other materials necessary for the child’s health coverage. (6) While the child is residing the Father in the District, the latter was permitted to take him anywhere within 15 miles of the District, provided he gave 30 days’ written notice to the Mother; but the Father was not allowed to move child more than 15 miles of the District without the Court’s prior approval. (7) The Court set out a detailed weekly supervised visitation schedule with the Mother, together with holiday visits. (8) The order provided that the Mother’s visits take place within the District of Columbia and were to be supervised (including at the transition at the location specified by the Court) by neutral and licensed psychologist, social worker, or other mental health professional mutually acceptable to the parties, to be charged with monitoring the interactions between child and his Mother and others, ensuring the child’s return to the Father, with the obligation to notify the Court of any alienating behavior by her or others connected with her. The fee was to be borne entirely by the Mother. (9) Each parent was required to begin promptly his or her own therapy with this licensed psychologist or psychiatrist. (10) Both parties were required to take steps to see that no passports are issued for the child by the government of any nation and that any existing passports in the child’s name are canceled or placed in a status that does not permit the child to travel outside the United States. (11) A pre-trial conference in the divorce aspect of the case was set for a date in March 2012.
DOMESTIC RELATIONS LAW
POST-DIVORCE CHILD CUSTODY AND SUPPORT / UNIFORM CHILD CUSTODY JURISDICTION AND ENFORCEMENT ACT (UCCJEA) / TREATMENT OF A FOREIGN NATION THEREUNDER / DUE PROCESS NOTICE
Précis: (1) The Uniform Child Custody Jurisdiction and Enforcement Act (UCCJEA) governs the circumstances in which state courts may exercise subject matter jurisdiction over children in an increasingly-mobile era. (2) It is designed to (a) avoid jurisdictional conflict between state courts in matters of child custody; (b) promote cooperation between States to fashion custody orders; (c) diminish controversies over child custody; (d) deter child abductions; (e) avoid re-litigation of issues; and (f) facilitate enforcement of custody decrees from other States. The statute comprehends both the District of Columbia and any foreign nation as a “State.” (3) The statue places a presumptive emphasis on the original custody order, permitting changes only pursuant to the following narrowly-defined set of circumstances: (a) the District has been the child’s “home state” wherein s/he has resided with a parent (or a parental figure) for at least six months prior to the court proceeding; (b) (i) no other State is the child’s home state as of that time or court of the child’s home state has declined to exercise jurisdiction and (ii) the child and at least one parent have a “significant connection” with the District other than “mere physical presence”; and (iii) “substantial evidence” evidence of the child’s care, protection, training, and personal relationships is available in the District; (c) all courts having jurisdiction under a “home state” theory of jurisdiction have declined to exercise jurisdiction; or (d) no court would have jurisdiction under any of the foregoing criteria. (4) The statute grants Continuing Exclusive Jurisdiction (CEJ) to the original State which has properly asserted jurisdiction. CEJ is designed to foster comity between States and avoid re-litigation. It obtains unless one of two exceptions applies: (a) the Court determines that (i) neither the child and one parental figure has a significant connection with the District and (ii) that substantial evidence concerning the child’s care, protection, training, and personal relationships is no longer available here; or (b) the child and at least one parental figure do not presently reside here. (5) In furtherance of the concept of CEJ, the statute generally prohibits a court of one State from modifying a custody order issued by a court of another State, permitting any such modification only in specified circumstances: (a) the court in the other State determines that it no longer has CEJ or that the D.C. Court would be a more convenient forum or (b) the D.C. Court or the other state court determines that child and at least one of his or her parental figures do not presently reside in the other State. (6) The statute provides a third, but pressing, exception known as Temporary Emergency Jurisdiction (TEJ) by which the District has emergency jurisdiction if (a) the child is present here and (b) has been abandoned or it is necessary in an emergency to protect the child because s/he, or a sibling or parent is subjected to or threatened with mistreatment or abuse. (7) But TEJ means just what it says: if there is a previous custody order the TEJ order is only temporary, indicating a time period for its duration. (8) The statute expressly comprehends the Due Process basics of prior notice and adequate opportunity to be heard, which it requires be given to “any person having custody of the child” and “in a manner reasonably calculated to give actual notice.” (9) Finally, the statute provides courts with the power to register and enforce custody orders issued by courts of other States, unless a person contesting the request establishes (a) the other State lacked jurisdiction, (b) the order had been vacated, stayed, or modified, or (c) the person challenging the request did not receive notice of the proceedings in the other State. (10) Thus, a custody determination made by a court in a foreign country must conform to the due process requirement of the statute. (11) The statute mandates an award of attorney’s fees and related costs to the prevailing party unless it would be “clearly inappropriate.”
Abstract: In this case, a child custody order issued by a court in a foreign nation was ruled fatally flawed for purposes of recordation and enforcement in the District of Columbia because the respondent in the case had not been given notice and opportunity to be heard before the foreign court. Facts: The salient facts on which this Memorandum Opinion is predicated are the following: (a) The parents of the 10-year-old boy who is the focus of this case are citizens of Slovenia, which consists of the northernmost provinces of the former Yugoslavia, located directly across the Adriatic from Venice, although the child is a U.S citizen. (b) From 1980 to 2010, the Father lived in the District of Columbia, where he was employed as a researcher at the World Bank. The Mother has lived in the United States for approximately the same period of time and, after a brief stint on the faculty of Notre Dame University in Indiana, where the child was born, and one year teaching in England, she moved to the District and continues to reside here. (c) The couple met in 2000, and began a brief romantic relationship, which resulted in pregnancy. They married in December of that year, but never lived together and were already estranged by the time their son was born in August 2001. (d) A decree of divorce was granted by the Superior Court in May 2002, in which the Mother was granted sole physical custody of the child, with plenary decision-making authority regarding his health, education, and general welfare, and visitation privileges for the Father. (e) Three years later, however, the Mother removed with the child to England and disputes quickly arose between the parents over the child’s visits with the Father. This resulted in continuous litigation and allegations of international kidnapping against the Mother. (f) In December 2006, a state trial court in Indiana modified the divorce/custody decree, granting sole permanent physical and legal custody to the Father, with visitation to the Mother. (g) The Father brought the child to live with him in the District and the Mother followed a few months later in order to be near the child. (h) Now, with the entire family residing in the District, the Mother filed a motion in Superior Court to modify the Indiana order and for child support. (i) After a lengthy series of hearings, the parties agreed to a settlement which the Court embodied in its final judgment in July 2009. Finding that the Mother’s move to the District constituted a “material and substantial change in circumstances” the Court found that it was in the child’s best interests for the parents to share joint physical and legal custody, but that the Mother would make all final decisions concerning his health care, school placement, and extra-curricular activities. (j) In response to the Mother’s motion for child support, in May 2010, the Court ordered that the Father pay $2,100 per month for that purpose, retroactive to November 2009. (k) The order issued, however, at almost the exact time that the Father was slated for retirement at the end of May 2010, shortly after which he removed to his native Slovenia. (l) The next month, the Father filed a motion to modify the custody/support order, contending that it would be best for the child, now nearly nine, to live with him in Slovenia full time. The Mother opposed the motion and filed a cross-motion seeking a change in custody and support terms. (m) Prior to the hearing in August, 2010, the parties once again reached an agreement whereby the Mother would have primary physical custody of the child in the District, as well as final decision-making authority over all substantial issues relating to his general and mental health, schooling, and extra-curricular activities. Annual six-week visits with the Father in Slovenia would be scheduled in the Summer and another during his Christmas or Easter school breaks. It was also agreed that the Father would retain custody of the child’s passport, on the proviso that he would return it to the Mother after each visit with him. Finally the Father’s child support payments were slightly reduced, after certain tuition and retroactive child support adjustments were made. (n) Notwithstanding his agreement, during the child’s Summer visit in 2011, the Father petitioned a court of pertinent jurisdiction in Slovenia to grant him sole custody. No notice of the hearing was provided to the Mother and she did not have any opportunity to be heard. Ruling that the parents were both citizens of Slovenia, the Court there rejected the orders of the U.S. courts and granted physical temporary custody of the child to the Father, permitted him to retain possession of the child’s passport, and prohibited removing the child from Slovenia. The Mother was granted visitation, but only in that country. (o) When the Mother returned to Slovenia to retrieve the child, the Father delivered him but not his passport, thus making it immediately impossible for her to take the child back to the United States. She overcame that obstacle by obtaining a substitute passport for the child from the U.S. Embassy in Slovenia and brought him back to the District in August 2011. (p) That same month she filed a challenge to the Slovenian order, arguing that the District had exclusive jurisdiction over the matter under the Uniform Child Custody Jurisdiction and Enforcement Act (UCCJEA) as the situs of his official residence and the jurisdiction which issued the most recent order under that statue. She further argued that the foreign order was void on its face because she had not been provided even the rudiments of due process notice and opportunity to be heard prior to its issuance. (q) After the Father learned that the Mother had taken the child back to the District, he immediately filed this motion in D.C. Superior Court to “register, confirm, and enforce” the foreign judgment under the pertinent section of the UCCJEA here, even though a permanent custody hearing was scheduled there three months hence. Rulings: The Court ruled on the issues presented as follows: (A) The UCCJEA. Applying the statute to the District of Columbia, which has adopted it, the statute’s provisions are as follows: (1) The statute governs the circumstances in which state courts may exercise subject matter jurisdiction over children in an increasingly-mobile era. (2) It is designed to (a) avoid jurisdictional conflict between state courts in matters of child custody; (b) promote cooperation between States to fashion custody orders; (c) diminish controversies over child custody; (d) deter child abductions; (e) avoid re-litigation of issues; and (f) facilitate enforcement of custody decrees from other States. The statute comprehends both the District of Columbia and any foreign nation as a “State.” (3) The statue places a presumptive emphasis on the original custody order, permitting changes only pursuant to the following narrowly-defined set of circumstances: (a) the District has been the child’s “home state” wherein s/he has resided with a parent (or a parental figure) for at least six months prior to the court proceeding; (b) (i) no other State is the child’s home state as of that time or court of the child’s home state has declined to exercise jurisdiction and (ii) the child and at least one parent have a “significant connection” with the District other than “mere physical presence”; and (iii) “substantial evidence” evidence of the child’s care, protection, training, and personal relationships is available in the District; (c) all courts having jurisdiction under a “home state” theory of jurisdiction have declined to exercise jurisdiction; or (d) no court would have jurisdiction under any of the foregoing criteria. (4) The statute grants Continuing Exclusive Jurisdiction (CEJ) to the original State which has properly asserted jurisdiction. CEJ is designed to foster comity between States and avoid re-litigation. It obtains unless one of two exceptions applies: (a) the Court determines that (i) neither the child and one parental figure has a significant connection with the District and (ii) that substantial evidence concerning the child’s care, protection, training, and personal relationships is no longer available here; or (b) the child and at least one parental figure do not presently reside here. (5) In furtherance of the concept of CEJ, the statute generally prohibits a court of one State from modifying a custody order issued by a court of another State, permitting any such modification only in specified circumstances: (a) the court in the other State determines that it no longer has CEJ or that the D.C. Court would be a more convenient forum or (b) the D.C. Court or the other state court determines that child and at least one of his or her parental figures do not presently reside in the other State. (6) The statute provides a third, but pressing, exception known as Temporary Emergency Jurisdiction (TEJ) by which the District has emergency jurisdiction if (a) the child is present here and (b) has been abandoned or it is necessary in an emergency to protect the child because s/he, or a sibling or parent is subjected to or threatened with mistreatment or abuse. But TEJ means just what it says: if there is a previous custody order the TEJ order is only temporary, indicating a time period for its duration. (7) The statute expressly comprehends the Due Process basics of prior notice and adequate opportunity to be heard, which it requires be given to “any person having custody of the child” and “in a manner reasonably calculated to give actual notice.” (8) Finally, the statute provides courts with the power to register and enforce custody orders issued by courts of other States, unless a person contesting the request establishes (a) the other State lacked jurisdiction, (b) the order had been vacated, stayed, or modified, or (c) the person challenging the request did not receive notice of the proceedings in the other State. Thus, a custody determination made by a court in a foreign country must conform to the due process requirement of the statute. (B) As Applied. The Court addressed both the issue of subject matter jurisdiction and that of due process notice. (1) Jurisdiction. The Court addressed both domestic and foreign jurisdiction in the case. (a) The original Indiana order was at issue with regard to jurisdiction. The Court found that all the jurisdictional requirements for its modification “fit squarely” within this case. It was uncontested that by the time the Mother filed her motion, the Father and the child (pursuant to the Indiana custody order) had lived in the District for more than six months prior, making it the child’s “home state.” Finally, by the time of the filing, both parents and the child lived here and neither has since departed. (b) In contrast, the Court ruled, the Slovenian Court had no jurisdiction under the UCCJEA to modify the Superior Court’s 2010 custody determination, for the following reasons: (i) the Superior Court had not made any determination that its CEJ had lapsed or that the Slovenian Court was a more convenient forum in which to make a modified custody determination; (ii) no court had determined that the child and both parents no longer resides in the District; and (iii) the Slovenian Court would not have had jurisdiction under the statute to make an initial custody determination, inasmuch as the District remained the child’s home state. (c) Nor did the foreign court have TEJ to issue an emergency order. Although an argument could have been made that the child would suffer serious emotional damage if he was returned to the District, the Slovenian Court made no findings that he had been threatened, mistreated, abused, or abandoned at the hands of his Mother, issues which the statute specifically states must be addressed. Indeed, the Father stated to the Slovenian Court that, if the Mother were to move to that country, joint custody would be appropriate. Finally in this regard, the Slovenian Court did not comply with the statures strict requirements for the issuance of a TEJ order, instead leaving its terms open indefinitely. (d) The Court herein therefore concluded that “Slovenia thus lacked jurisdiction under the UCCJEA … to enter any type of permanent or temporary order governing the custody of the child.” Accordingly, the Father’s motion to register, confirm, and enforce that order was denied. (2) Notice. Beyond that, the Court found, the Slovenian Court’s ex parte order was fatally flawed because no notice whasotever had been given the Mother for any meaningful opportunity to be heard in the matter before it, as required by the UCCJEA. The record there showed that numerous documents had mailed to her at an incorrect address in the District. There was no evidence that anything from that Court had ever reached her “and no reason to believe that it did.” That she did not appear before that Court was counter-intuitive to all her actions regarding child custody over the previous ten years, wherein she “had seized on each and every opportunity to participate in the parties’ ongoing custody dispute, without regard to location.” She had “litigated with great intensity” over this issue in Indiana, the District, and England previously and the Court found it “inconceivable that she would have failed to participate in the proceedings in Slovenia … had she been aware of those proceedings at the time.” Finding a total lack of notice to the Mother in the foreign proceedings, the Court the deemed this an even more fundamental reason to deny the Father’s motion to register that order here. (C) Attorney’s Fees. The Mother, appearing pro se, requested an award of attorney’s fees and related costs in successfully opposing the Father’s registration motion, found invalid on its face. The UCCJEA mandates such an award unless it would be “clearly inappropriate.” Here, the Court found that the Father had “advanced no reason why an award of … [the Mother]’s actual expenses would be ‘clearly inappropriate’ under the circumstances, and the Court can think of none, given the complexity of the legal a factual issues raised.” It therefore provided the Mother with an opportunity to submit an affidavit, to be supported with billings and receipts, setting forth the award requested; the Father was also provided with an opportunity respond on the issue of reasonableness thereof. (D) Future Visitation. The Court had admitted an Amicus to the case a major local law firm which appeared on a pro bono basis (and whose work it deemed “of the very highest quality”). Noting that under the statute the Court had authority to modify its own order, the Amicus urged it to address the child’s future visits with the Father (who remained in Slovenia) out of concern for the potential for the child’s abduction or wrongful retention during future visits with him. Although sharing that concern, the Court determined that the current order was sufficient for the time being because the next visit was not for another three months and the parties had already indicated that they intended to file motions to modify the permanent custody order, anyway. (E) Conclusions. The Court reaffirmed its CEJ and stated that it was prepared “to give prompt attention” to any motion filed in the case. It ruled that the UCCJEA precluded enforcement of any aspect of the foreign custody order and the Father’s motion to register it here was denied.