United States District Court, District of Columbia
RUDOLPH CONTRERAS United States District Judge
in Part and Denying in Part Defendant’s Motion to
Neway Alemayehu brings this action alleging that three
individuals, Belay Abere, Bekalu Bayabile, and Iyossias
Tilahun (collectively, “Defendants”), worked
together to defraud Mr. Alemayehu out of his $460, 000
investment in a restaurant enterprise currently known as
Amsterdam Café and Lounge. See generally
Compl., ECF No. 1. Mr. Tilahun, proceeding pro se,
has moved to dismiss Mr. Alemayehu’s complaint under
Federal Rule of Civil Procedure 12(b)(6). See
Def.’s Mot. Dismiss at 1, ECF No. 5. Because the Court
concludes that Mr. Alemayehu has failed to state a claim upon
which relief can be granted for his promissory estoppel and
quantum meruit causes of action, the Court will grant Mr.
Tilahun’s motion to dismiss as to those claims.
Because, however, the Court also determines that Mr.
Alemayehu has properly alleged his remaining claims, the
Court will deny Mr. Tilahun’s motion to dismiss as to
Mr. Alemayehu’s remaining claims.
to the complaint, Mr. Bayabile and Mr. Abere approached Mr.
Alemayehu about investing in a restaurant enterprise in April
2015. Compl. ¶ 7. A written agreement,
signed by Mr. Abere, described the terms of the investment:
Mr. Abere would transfer a building lease and liquor license
to BelayAbere Enterprises, LLC (“the LLC”); Mr.
Abere and Mr. Bayabile would be 5 percent and 15 percent
shareholders in the LLC, respectively; Mr. Alemayehu would be
the majority shareholder (owning the remaining 80 percent) of
the LLC; and Mr. Alemayehu would serve as the executive
manager of both the LLC and the restaurant. Id. Mr.
Abere also made oral assurances reinforcing these terms.
on these written agreement and oral assurances, Mr. Alemayehu
decided to proceed with investing in the restaurant.
Id. Mr. Alemayehu thus began contributing funds to
“(a) pay back rents that [Mr.] Abere owed the landlord,
along with taxes and insurance; (b) pay all legal fees to get
the lease and liquor license transferred to the LLC; (c)
finish the renovation of the restaurant; (d) replace the HVAC
and water heater systems; (e) purchase and install new
kitchen equipment; (f) install security and fire alarm
systems; and (g) furnish the restaurant with tables, chairs,
bar stools, a liquor/wine inventory, and a computerized cash
register system.” Id. ¶ 9. Mr. Alemayhu
paid for “substantial construction work” that was
“performed over the course of more than three
months.” Id. ¶ 8.
Alemayehu soon encountered difficulties. The landlord for the
restaurant’s building refused to allow Mr. Abere to
assign the building lease to the LLC. Id. ¶ 10.
Because of Mr. Abere’s “history of being
dishonest, not paying rent, and disappearing on [the
landlord] for months at a time, ” the landlord wanted
Mr. Abere to be personally liable for the rent. Id.
Mr. Alemayehu, however, worked with the LLC’s attorneys
in an effort to persuade the landlord to allow assignment of
the building lease to the LLC. Id. Mr. Alemayehu
also attempted to transfer the liquor license to the LLC, in
accordance with the written agreement and oral assurances he
had received. Id.
this time, however, Mr. Abere left the United States without
informing Mr. Alemayehu, traveling to East Africa.
Id. Mr. Abere remained abroad for nearly three
months, and was “hardly reachable” during this
time. Id. Mr. Alemayehu eventually received,
however, assurance from Mr. Abere that he would return to the
United States shortly, and that he would reach out to the
landlord’s attorney to arrange assignment of the lease.
Id. With this assurance, Mr. Alemayehu continued to
supply funds for the restaurant’s rent, tax, and
Mr. Abere’s return to the United States, he informed
Mr. Alemayehu and the LLC attorneys that, curiously, the
landlord would only assign the lease to the LLC if the
landlord was “presented with an LLC operating agreement
which showed [Mr.] Abere as the only member.”
Id. ¶ 11. Mr. Abere requested, therefore, that
Mr. Alemayehu be temporarily removed from the LLC membership
documents. Id. Although “[n]either [Mr.
Alemayehu] nor the LLC attorneys believed this to be an
acceptable outcome, . . . the attorneys made the temporary
changes until the assignment was accomplished.”
Id. The amended operating agreement listed both Mr.
Alemayehu and Mr. Abere as “manager[s].”
result of these issues with the lease and license transfers,
the LLC attorneys eventually recommended a new plan for the
restaurant, which they suggested was the “only
realistic way forward.” Id. ¶ 12. First,
“the lease, liquor license[, ] and business license,
” would remain “under [Mr.] Abere’s
name.” Id. Mr. Abere would also “sign a
binding agreement with the LLC that made the LLC the managing
company until [Mr.] Abere regained the landlord’s trust
and obtained her permission to transfer the lease, liquor
license[, ] and business license to the LLC.”
Id. Mr. Alemayehu, meanwhile, “would be the
executive manager, have daily access to financial records, be
able to participate in major corporate decisions, and secure
the power of attorney from [Mr.] Abere.” Id.
accordance with this plan, in October 2015, the liquor
license was subsequently transferred to Mr. Abere.
Id. ¶ 13. But Mr. Abere once again left the
United States “without completing the management
agreement, without giving the power of attorney to [Mr.
Alemayehu], and without resolving an ongoing disagreement
with [Mr. Alemayehu] regarding the financial aspect of the
management agreement.” Id. Despite these
issues, the restaurant opened and began operating around this
months later, Mr. Abere returned to the United States.
Id. ¶ 14. Shortly afterwards, Mr. Abere
“argued that his superior liability protection and
experience required that he take over the management and
operation of the business.” Id. Mr. Abere
assured Mr. Alemayehu that this takeover would be temporary.
Id. Mr. Alemayehu eventually relented as he believed
this course of action “to be beneficial . . . as long
as [the] management was performed in an inclusive,
collaborative way.” Id. But later, when Mr.
Alemayehu requested that Mr. Abere complete the management
agreement and sign the power of attorney, Mr. Abere delayed
because “he needed legal advice.” Id.
¶ 15. Mr. Abere eventually refused to sign the power of
attorney, id., and also refused to sign the
“management agreement . . . that would have made [Mr.
Alemayehu] the on-site executive manager consistent with the
executive operation rights, ” id. ¶ 19.
during these events, Mr. Abere hired Mr. Tilahun, who had
previously worked only as a consultant for the restaurant, as
the “general manager” of the restaurant with
“major authority in terms of running the restaurant
enterprise.” Id. ¶ 16. Mr. Alemayehu
expressed to Mr. Abere that Mr. Tilahun was unqualified to
serve as general manager, and “need[ed] to be replaced
by a more experienced manager.” Id. ¶ 17.
Mr. Tilahun reportedly “had very little
people-to-people skills, and as a result the company had very
bad restaurant reviews from customers.” Id.
addition, Mr. Tilahun presented several other issues for the
restaurant. See Id. First, Mr. Tilahun “is a
foreign national who does not possess the necessary
authorization to work in the United States” and his
hiring “thus exposed the restaurant enterprise senior
executives . . . to potential liability in case of an
Immigration Customs Enforcement investigation, which could
result in closure and loss of [Mr. Alemayehu’s]
investment.” Id. ¶ 16. Second,
because of his immigration status, Mr. Tilahun could not
apply to serve as “an [Alcoholic] Beverage Commission
(ABC) Licensed manager, ” and therefore the restaurant
operated without a licensed manager “which is against
[the District of Columbia Alcoholic Beverage Regulation
Administration’s] basic rules.” Id.
Tilahun, however, assisted Mr. Abere in undermining Mr.
Alemayehu’s position in both the LLC and the
restaurant. See Id. ¶¶ 16-18. Mr. Tilahun
followed Mr. Abere’s instructions to keep Mr. Alemayehu
“in the dark about [the restaurant’s]
operations.” Id. ¶ 16. Mr. Tilahun was
allegedly “promised a salary and commission structure
as a reward” for doing so. Id. ¶ 17. Mr.
Tilahun also reportedly had a “long history of securing
financial assistance from [Mr.] Abere.” Id.
That assistance, which apparently “included some of
[Mr. Alemayehu’s] funds, ” allowed Mr. Tilahun
“to acquire a Mercedes Benz for his own use and
Tilahun also “maliciously interfere[d] with the
contractual agreements” made regarding Mr.
Alemayehu’s involvement in the restaurant. Id.
¶ 20. Specifically, Mr. Tilahun “began informing
restaurant employees not to take any orders from [Mr.
Alemayehu].” Id. Mr. Tilahun told the
employees “that he work[ed] for [Mr.] Abere and [Mr.]
Bayabile, ” which “created an impression among
the employees that [Mr. Alemayehu] did not have any control
or decision making authority.” Id. Mr. Tilahun
reportedly also “badmouth[ed] [Mr. Alemayehu] to all
restaurant employees, blaming [Mr. Alemayehu] to cover up
[Mr.] Abere’s poor management and planning
Mr. Bayabile, the third LLC shareholder, also appeared to
work against Mr. Alemayehu. Mr. Bayabile followed Mr.
Abere’s instructions to “keep [Mr. Alemayehu] in
the dark as to the financial operations of the restaurant
enterprise.” Id. ¶ 18. Mr. Bayabile thus
“continued to work against [Mr. Alemayehu’s]
interest by totally aligning himself with [Mr.] Abere.”
Id. ¶ 20.
the restaurant’s rough start, see Id. ¶
17, starting in December 2015, Defendants “were able to
realize the turnaround of the restaurant business, ”
id. ¶ 20. Soon afterwards, however, Mr. Abere
“changed the bank account of the merchant services to
his personal account, without letting [Mr. Alemayehu] know
about that change.” Id. ¶ 19. Mr.
Alemayehu believes that Mr. Abere forged Mr.
Alemayehu’s signature to do so. See Id. Mr.
Abere has “refused to share financial statements and
financial operations data with [Mr. Alemayehu]” and has
“avoided all communication[s], discussions, and [Mr.
Alameyhu’s] request[s] for explanation.”
Id. Therefore, Mr. Alemayehu claims he “knows
nothing about the financial status of the business, ”
despite his status as an investor in the restaurant and as
the majority shareholder in the LLC. Id.
February 2016, Defendants “delay[ed] in making timely
rent payments” for the restaurant’s building, and
as a result received complaints from the landlord.
Id. ¶ 22. These rent payments were delayed even
though Defendants had previously “solicited additional
funding from [Mr. Alemayehu]” to make “overdue
rent payments.” Id. To make these delinquent
rent payments, Mr. ...