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Klayman v. Judicial Watch, Inc.

United States District Court, District of Columbia

May 4, 2016

LARRY KLAYMAN, Plaintiff,
v.
JUDICIAL WATCH, INC., Defendant

MEMORANDUM OPINION

COLLEEN KOLLAR-KOTELLY, United States District Judge.

More than ten years ago, Plaintiff Larry Klayman entered into a severance agreement with Defendant Judicial Watch. In this action, originally filed in the District of Columbia Superior Court, Plaintiff alleges that Defendant Judicial Watch materially breached the severance agreement and, as a result, he seeks to rescind that severance agreement. Defendant removed the case to this Court, and Plaintiff now seeks for the case to be remanded to the Superior Court. Before the Court is Plaintiff’s [4] Motion for Remand. Upon consideration of the pleadings, [1] the relevant legal authorities, and the record as a whole, the Court GRANTS IN PART and DENIES I N P A R T Plaintiff’s [4] Motion for Remand. The Court REMANDS this case to the D.C. Superior Court but DENIES Plaintiff’s request for attorney’s fees.

I. BACKGROUND

The Court recites only the limited background necessary for the Court’s resolution of the Motion for Remand currently before the Court.

On September 19, 2003, Plaintiff Larry Klayman entered into a severance agreement with Defendant Judicial Watch. Compl. ¶ 14. As relevant with respect to the Motion for Remand now before the Court, the severance agreement includes a forum selection clause. Under the heading of “Choice of Law; Consent to Venue and Jurisdiction, ” the parties agreed to the following:

The Parties consent to the jurisdiction and venue of any state or federal court located within the District of Columbia in any action or judicial proceeding brought to enforce, construe or interpret this Agreement or otherwise arising out of or relating to Klayman’s employment.

Compl., Ex. 1 (Confidential Severance Agreement) ¶ 23. The parties dispute the legal effect of this clause with respect to the pending motion as discussed below.

Plaintiff now seeks to rescind the severance agreement based on an allegation that an officer of Judicial Watch defamed Plaintiff in violation of the severance agreement. See Id . ¶¶ 15-21. Plaintiff filed his suit in the District of Columbia Superior Court, and Defendant removed it to this Court. Plaintiff promptly filed a Motion for Remand to the Superior Court, which is now before the Court.

II. DISCUSSION

Plaintiff Larry Klayman argues that this case should be remanded to the Superior Court for several reasons. First, Plaintiff argues that this Court does not have diversity jurisdiction over this case because the amount in controversy requirement has not been met. Second, Plaintiff argues that removal is improper under 28 U.S.C. § 1441(b)(2) because Defendant is a citizen of the forum state, the District of Columbia. Third, Plaintiff argues that Defendant waived its right to remove this case to this Court pursuant to the severance agreement between the parties. The Court reviews these arguments in turn and concludes that it is necessary to remand this case to the Superior Court. Finally, the Court concludes that, even though remand is proper, Plaintiff’s request for attorney’s fees is not warranted.

A. The Amount in Controversy is Satisfied

For a federal court to exercise diversity jurisdiction, the parties must be citizens of different states and the amount in controversy must exceed $75, 000. 28 U.S.C. § 1332(a). Plaintiff argues that this case does not satisfy those requirements because he is seeking only equitable relief. Defendant responds that, in an action seeking rescission, the amount in controversy is the value of the contract, which exceeds $75, 000. The Court agrees with Defendant.

As a general matter, the amount in controversy in declaratory relief or injunction cases is measured by the value of the object of the litigation. Hunt v. Wash. State. Apple Adver. Comm’n, 432 U.S. 333, 347 (1977) (citing cases). In assessing whether a complaint meets the jurisdictional threshold, courts look to either the value of the right the plaintiff seeks to enforce or the cost to the defendants to remedy the alleged denial of that right. Smith v. Washington, 593 F.2d 1097, 1099 (D.C.Cir.1978) (internal citations omitted). In this case, Plaintiff seeks to rescind the severance agreement between the parties under which he received $600, 000. See Pl.’s Opp’n to Mot. to Dismiss, ECF No. 5, at 13. For that reason, this action satisfies the amount in controversy necessary for the Court to exercise diversity jurisdiction over this ...


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