WORLD CLASS CONSTRUCTION MANAGEMENT GROUP, ET AL. Plaintiffs,
BRYNEE BAYLOR, ET AL. Defendant. AND SHELDON ARPAD, ET AL. Plaintiffs,
BRYNEE BAYLOR, ET AL. Defendants
Royce C. Lamberth, District Judge
Plaintiffs World Class Construction Management Group (“WCCM”) and William Barrett and plaintiffs Sheldon and Diane Arpad bring these suits against defendants Brynee Baylor and Baylor and Jackson, P.L.L.C. (“B&J”) for allegedly breaching escrow agreements and defrauding them.
The plaintiffs in both cases now move for partial summary judgment on the counts of breach of contract, breach of fiduciary duty, and negligence. Upon consideration of WCCM and Barrett’s motion  for partial summary judgment and Baylor’s opposition  thereto, the Court will DENY their motion. Upon consideration of the Arpads’ motion  for summary judgment and Baylor’s opposition  thereto, the Court will DENY their motion.
Both actions consist of similar and overlapping facts. In January 2011, William Youngblood sought financing of approximately $20 million to buy a plot of land in Prince George’s County, Maryland, and build a 121-room hotel on it. He approached The Milan Group, which agreed to arrange the loan if Youngblood could provide a $500, 000 deposit to facilitate the loan and pay administrative costs and fees. To acquire this sum, Youngblood requested loans of $130, 000 from plaintiff William Barrett’s company, WCCM, and of $140, 000 from plaintiffs Sheldon and Diane Arpad and offered to double their returns by February 10, 2011. Both plaintiffs agreed and formalized the arrangements in two memoranda of understanding (“MOUs”) on January 17, 2011.
According to the MOUs, WCCM and the Arpads were to wire their contributions on January 18 and 19, respectively, directly to an escrow account maintained by B&J, a law firm retained by The Milan Group and controlled by defendant Brynee Baylor. According to each of their escrow agreements with B&J, B&J was “under no circumstances [to] release all or any part of the deposit[s] until . . . [the] Loan Provider/Facilitator [The Milan Group] . . . provide[d] written confirmation to the Investor[s] [WCCM and the Arpads] that the loan ha[d] been approved and the funding w[ould] take place on or before February 1, 2011.” WCCM Am. Compl. Ex. 4; Arpad Compl. Ex. 3 (emphasis added).
Frank Lorenzo, the CEO of The Milan Group, then sent two letters “to whom it may concern” (but presumably to the plaintiffs) with both letters dated January 18, 2011. In one letter, he informed the plaintiffs that The Milan Group was facilitating the loan for Youngblood and guaranteed the loan would come through by or before February 15, 2011. He promised that if funding was delayed or ultimately not completed for any reason, The Milan Group would be fully responsible for returning $130, 000 to WCCM and $140, 000 to the Arpads. In the other January 18 letter, Lorenzo stated that The Milan Group had “received a commitment for the loan from HSBC London and [was] anticipating a closing by or before February 10, 2011.” Def.’s Opposition to WCCM, Ex. 5.
On January 18 and 19, WCCM’s and the Arpads’ wire transfers of $130, 000 and $140, 000 went through as scheduled to B&J’s escrow account. Baylor testifies that during these events she spoke with Sid Dugar, an attorney representing both plaintiffs, who confirmed the plaintiffs were aware that, based on Lorenzo’s communications, the funding would most likely arrive after February 1 but that they still wanted to move ahead with the transactions.
Allegedly interpreting the foregoing events as satisfying the conditions of the escrow agreement, Baylor made two withdrawals from the escrow account in the amounts of $25, 000 and $18, 600 on January 20, 2011. Then, on January 25, 2011, she wired $75, 000 from the escrow account to The Milan Group. The plaintiffs allege that these actions violated the escrow agreement and are sufficient to establish breach of contract, breach of fiduciary duty, and negligence and move for partial summary judgment on these counts. This court exercises diversity jurisdiction over these claims pursuant to 28 U.S.C. § 1332.
Over the succeeding few weeks, the plaintiffs received several letters from Baylor and The Milan Group indicating the loan was only a few brief steps from completion. Eventually, the loan fell through allegedly because one of the participants involved disagreed over the conditions of the financing and The Milan Group could not find an alternative to that participant’s involvement. Later, it surfaced that “Frank Lorenzo” was actually an alias for Frank Pavlico, who had previously been convicted of money laundering. In November 2011, the Securities and Exchange Commission initiated a securities fraud action against Pavlico, The Milan Group, Baylor, B&J, and others, alleging that they were all involved in an elaborate scheme to defraud approximately 13 investors out of $2.1 million. That case is currently pending in this court before Judge Collyer. SEC v. The Milan Group, Inc., et. al., No. 11-cv-2132 (D.D.C. 2011).
II. LEGAL STANDARD
A. Summary Judgment
Summary judgment is reserved only for cases in which “ there is no genuine dispute as to any material fact and  the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a); Accord Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986). A dispute about a material fact “is ‘genuine’ . . . if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Anderson, 477 U.S. at 248. The moving party bears the burden of demonstrating the absence of any genuinely disputed material facts. Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). Once it satisfies that burden, the moving party is “‘entitled to judgment as a matter of law’ if the nonmoving party ‘fails to make a showing sufficient to establish the existence of an element essential to that party’s case, and on which that party will bear the burden of proof at trial.’” Lathram v. Snow, 336 F.3d 1085, 1088 (D.C. Cir. 2003) (quoting Celotex, 477 U.S. at 322). In making these ...