United States District Court, District of Columbia
MEMORANDUM OPINION GRANTING HALEY BADER & POTTS,
P.L.C.'S MOTION TO DISMISS; GRANTING GARVEY, SCHUBERT
& BARER'S MOTION TO DISMISS; AND GRANTING IN PART AND
DENYING IN PART HENRY A. SOLOMON'S
MOTION TO DISMISS
RUDOLPH CONTRERAS United States District Judge.
days before the world bid farewell to the twentieth century,
attorney Henry Solomon filed seemingly-routine paperwork with
the Federal Communications Commission. Little did he know
that omissions on a one-page form would have his client
claiming that he lost it hundreds of millions of dollars
almost seventeen years later. Plaintiffs allege that Mr.
Solomon was negligent both in his filing of the FCC form and
in how he handled the administrative appeals. They also seek
to hold his employers-Haley Bader & Potts at the time he
filed the form and Garvey, Schubert & Barer when he
appealed-liable for his malpractice.
motions to dismiss present several disparate issues ranging
from the purely procedural to the purely substantive. The
now-defunct Haley Bader & Potts asks the Court to
identify to what extent it is possible for an attorney to
practice before a federal agency, yet remain beyond the reach
of District of Columbia courts. Garvey, Schubert & Barer
asks the Court to resist widening the scope of successor
liability vis a vis legal malpractice claims. The
same defendant also asks the Court to wade through a web of
“what-ifs” hidden in Plaintiffs' theories of
causation. Piggy-backing off of his co-defendants'
motions, Henry Solomon asks the Court to determine which
plaintiff may maintain this action, in light of one
plaintiff's attempted assignment of these claims to the
other plaintiff. Although these are only four of the many
issues that Defendants ask the Court to address, they are
sufficient for the Court to resolve the motions before it.
The Court will dismiss Plaintiffs' claims against Haley
Bader & Potts, P.L.C. for lack of personal jurisdiction,
and against Garvey, Schubert & Barer for failure to state
cognizable claims. The court will dismiss Plaintiffs'
claims pertaining to negligent appeals in Count Two against
Henry A. Solomon, and further dismiss all claims made by
Beach TV Properties for lack of standing. The sole remaining
plaintiff following this order is The Atlanta Channel, and
its sole remaining claim is in Count One against Henry
Solomon, for filing a defective Statement of Eligibility.
WTHC-LD License Application
in this case, Beach TV Properties, Inc. (“Beach
TV”), and The Atlanta Channel, Inc. (ACI), allege that
defendant Henry Solomon and his former law firms, defendants
Haley Bader & Potts, P.L.C. (“Haley Bader”)
and Garvey, Schubert & Barer (“Garvey”),
committed legal malpractice in connection with
Plaintiffs' application for an FCC Low-Power Television
(“LPTV”) class A license. See Am. Compl.
¶¶ 122-137, ECF No. 21. Specifically, Plaintiffs
allege that, in 1999, Mr. Solomon failed to adequately
complete the required Statement of Eligibility, which would
have entitled ACI to a class A license. Id.
¶¶ 24-27. They also allege that Mr. Solomon
committed malpractice throughout the administrative appeal
process for failing to raise procedural errors committed by
the FCC. Id. ¶ 125. Plaintiffs seek to hold
Haley Bader and Garvey jointly and severally liable for the
allegedly deficient application and appeals through theories
of respondeat superior, and, in the case of Garvey, successor
liability. See Id. ¶¶ 126-137.
1999, Congress enacted the Community Broadcasters Protection
Act (“CBPA”), codified at 47 U.S.C. §
336(f), to preserve LPTV community broadcasting. The CBPA
required the FCC to promulgate regulations to establish a
class A license for LPTV qualifying stations. See 47
U.S.C. § 336(f)(1)(A). It also required the FCC to,
“[w]ithin 30 days after November 29, 1999 . . . send a
notice to the licensees of all [LPTV] licenses that describes
the requirements for class A designation.” See
47 U.S.C. § 336(f)(1)(B). Then, “[w]ithin 60 days
after November 29, 1999,  licensees intending to seek class A
designation shall submit to the Commission a certification of
eligibility based on the qualification requirements, ”
and, “[a]bsent a material deficiency, the Commission
shall grant certification of eligibility to apply for class A
December 27, 1999, Beach TV signed six Statements of
Eligibility and sent them to Mr. Solomon for review and
filing with the FCC. Am. Compl. ¶ 22. That same day, ACI
also sent a Statement of Eligibility for its WTHC-LD license
to Mr. Solomon for review and filing. Id. ¶ 23.
Two days later, Mr. Solomon, employed by Haley Bader, filed
the Statements of Eligibility with the FCC, but failed to
complete Parts 3 or 4-the only portions pertaining to the
applicant's substantive eligibility-of the five-part,
one-page form for ACI's WTHC-LD license. See
Id. ¶ 24-25; Pls.' Am. Compl. Ex. A, ECF No.
21-1. In early June, 2000, the Mass. Media Bureau of the FCC
issued class A licenses to Beach TV's six LPTV stations.
Am. Compl. ¶ 29. A week later on June 9, despite ACI
meeting all eligibility requirements, the Mass. Media Bureau
dismissed ACI's Statement of Eligibility for WTHC-LD on
the grounds that it contained a “material
deficiency” because Part 3 of the form was not filled
out. Id. ¶¶ 30-32.
after the dismissal, Mr. Solomon filed a petition for
reconsideration with the Mass. Media Bureau, submitting an
“amended” ACI statement with all parts complete.
Id. ¶ 50. In November, 2000, the Bureau denied
ACI's petition because the original Statement of
Eligibility was “patently defective.”
Id. ¶ 52. The Bureau reasoned that “the
January 28th[, 2000] certification deadline was statutory
[so] the Commission [did] not have general authority to waive
or extend the deadline, absent extraordinary
circumstances.” Id. ¶ 53. Mr. Solomon
applied for review by the full FCC. Id. ¶ 65.
Nearly ten years later in November, 2012, finding that the
Mass. Media Bureau was reasonable in interpreting
“material deficiency” to include “the
complete omission of the required certifications, regardless
of whether the licensee actually met the statutory
qualifications at the time of filing, ” the FCC
rejected ACI's application for review. Id.
¶ 67. Garvey then unsuccessfully petitioned for
reconsideration, which the FCC denied on October 7, 2014.
Id. ¶¶ 70-72.
that year, Beach TV, represented by new counsel, appealed to
the United States Court of Appeals for the District of
Columbia Circuit. See Id. ¶ 73; Mot. of Def.
Garvey Schubert Barer to Dismiss Am. Compl. Under Rule
12(b)(6) (“Garvey Mot. to Dismiss”) Ex. 13, ECF
No. 24-14. Beach TV argued that the FCC's interpretation
of “material deficiency” and assertion that it
could not extend the deadline absent “extraordinary
circumstances” constituted legislative rulemaking under
the Administrative Procedure Act (“APA”), and
that the FCC had not followed APA requirements. See
Garvey Mot. to Dismiss Ex. 12, ECF No. 24-13; Am. Compl.
¶¶ 53-55. The D.C. Circuit, per curiam, ruled that
it did not have jurisdiction to address Beach TV's new
legislative-rulemaking claims. See Garvey Mot. to
Dismiss Ex. 13., at 3; Beach TV Properties, Inc. v.
FCC, 617 F. App'x 10, 11 (D.C. Cir. 2015). The court
further held that the FCC was not arbitrary or capricious in
concluding that ACI's failure to complete Parts 3 and 4
of the Statement of Eligibility constituted a material
deficiency, and that the statutory deadline of 60 days
“is unequivocal.” See Beach TV Properties,
Inc., 617 F. App'x at 11.
allege that they would have received a class A license had
Defendants made any of the following four arguments during
the WTHC-LD administrative appeals, see Am. Compl.
¶¶ 68, 76: first, that Plaintiffs were entitled to
formal adjudication under the APA, 5 U.S.C. § 558(c),
because they were applying for a license, see Id.
¶¶ 36-37; second, that the FCC's
interpretations of “material deficiency” and
statutory deadline constituted rulemaking under the APA,
id. ¶ 51; third, assuming that such
interpretations constituted rules, that they must have first
been published prior to taking effect, id. ¶
64; fourth, that the “rules” were unlawfully
retroactively applied, id.
Relationship Between Mr. Solomon, Haley Bader, and Garvey
March, 2000, before filing ACI's first petition for
reconsideration, Mr. Solomon moved from Haley Bader to
Garvey. Am. Compl. ¶ 83-89. He did so along with
“all of the attorneys and support staff of the Haley
firm, ” and continued providing legal advice to
Plaintiffs throughout his transition. Id. ¶
88(c). Shortly thereafter, Haley Bader stopped functioning as
a law firm and continued solely to wind up its affairs.
See Id. ¶ 89; Am. Compl. Ex. B, ECF No. 21-2.
Garvey expressly disclaimed responsibility for Haley
Bader's accounts receivable, accounts payable, and all
liabilities other than certain library subscriptions. Am.
Compl. Ex. B, at ¶¶ 6-8. Although Haley Bader
received no consideration for its dissolution, Am. Compl.
¶ 87, Garvey did hire all seven of Haley Bader's
members as “of counsel.” Am. Compl. Ex. B, ¶
2. These seven members would each become eligible for an
ownership interest in the firm “at a future date that
is not less than two years” after being employed at
Garvey. Id. ¶ 4. Until that time, they would
not be entitled to a vote in Garvey management or attend
firm-wide ownership meetings. See id.; Am. Compl.
Ex. C, at ¶ 1. Garvey conditioned the offers of
employment on Haley Bader showing evidence of tail insurance,
id. ¶ 7, and all seven members of Haley Bader
accepting, id. ¶ 12. At the end of 2005, Haley
Bader was cancelled by operation of law due to failure to pay
its annual registration fee. See Def. Haley Bader
& Potts P.L.C.'s Br. in Supp. of Rule 12(b) Mot. to
Dismiss Am. Compl. (“Haley Mot. to Dismiss”) Ex.
A, ECF No. 27-2.
Solomon is a citizen of the District of Columbia. Am. Compl.
¶ 5. Haley Bader was a Virginia Professional Limited
Liability Company, and was served process in Virginia
pursuant to Virginia law. Id. ¶ 8; Aff. of
Service by Haley Bader & Potts P.L.C., ECF No. 8. Garvey
is a Washington state law partnership of corporations, none
of which are citizens of Florida or Georgia. Am. Compl.
¶ 10. Mr. Solomon is licensed to practice law in the
District of Columbia, and “has held himself out . . .
as a specialist in FCC law . . . .” Id. ¶
7. Haley Bader and Garvey have also allegedly held themselves
out as specialists in FCC law. Id. ¶¶ 9,
11. According to Mr. Solomon, he sent the Statement of
Eligibility from Haley Bader's office in Virginia, and
Haley Bader performed all work on the Statement in Virginia.
See Haley Mot. to Dismiss Ex. B ¶¶ 5-6,
ECF No. 27-3. Neither Mr. Solomon nor any attorney from Haley
Bader appeared before the FCC in the District of Columbia in
connection with the WTHC-LD Statement. Id.
allege that Haley Bader does not have sufficient assets to
pay the full amount of damages alleged in the Complaint. Am.
Compl. ¶ 91.
Relationship Between ACI and Beach TV
Solomon's advice, ACI assigned the WTHC-LD license to
Beach TV in 2009. Am. Compl. ¶¶ 92-94. Mr. Solomon
had not advised either party that ACI had potential
malpractice claims, nor that assigning the license could harm
ACI's malpractice lawsuit. Id. ¶ 97.
However, Plaintiffs do not seek recovery on this basis.
See Id. ¶¶ 122-37. In 2015, ACI assigned
its malpractice claims to Beach TV “as of the date of
the assignment of the WTHC-LD License.” Id.
¶ 100. The Amended Complaint does not specify where the
assignment was negotiated or executed, but does allege that
Mr. Solomon-a D.C. resident then employed by Garvey in
Virginia-advised on the assignment. See Id.
TV is a Florida corporation with its principal place of
business in Florida. Id. ¶ 1. ACI is a Florida
corporation with its principal place of business in Georgia.
Id. ¶ 2. WTHC-LD broadcasts in Atlanta,
Georgia. Id. ¶ 111.
Court will first consider Haley Bader's motion to dismiss
for lack of personal jurisdiction. Because Haley Bader has
neither “continuous and systematic contacts” with
the District of Columbia nor sufficient contacts arising from
their allegedly negligent representation of ACI, the Court
will grant the motion and dismiss all counts against Haley
Bader. The Court will then turn its attention to Garvey's
motion to dismiss for failure to state a claim. Because
Garvey's employment agreements with Haley Bader's
former partners did not rise to the level of a de facto
merger or a mere continuation of the entity Haley Bader, the
Court will dismiss Count Six. The Court will also dismiss
Counts Two, Four and Five against both Garvey and Mr.
Solomon, because Plaintiffs' theories of malpractice
during the administrative appeal are not legally plausible.
Finally, with only Count One remaining against Mr. Solomon,
the Court will address whether ACI's attempted transfer
of these claims to Beach TV was effective. Because Virginia
law applies, it was not, and only ACI has standing to
maintain this action.
a diversity action brought under 28 U.S.C. § 1332.
See Am. Compl. ¶ 12. The parties are diverse
and the amount in controversy exceeds $75, 000. See
Id. ¶¶ 1-12, 122-137.
Personal Jurisdiction over Haley Bader
plaintiff bears the burden of establishing personal
jurisdiction over each defendant. Crane v. N.Y.
Zoological Soc'y, 894 F.2d 454, 456 (D.C. Cir.
1990). And, although the court must resolve any factual
discrepancies in favor of the plaintiff, Crane, 894
F.2d at 456, “[b]are allegations and conclusory
statements are insufficient.” Johns v. Newsmax
Media, Inc., 887 F.Supp.2d 90, 95 (D.D.C. 2012); see
also Second Amendment Found. v. U.S. Conference of
Mayors, 274 F.3d 521, 524 (D.C. Cir. 2001). A court may
consider evidence outside of the pleadings to resolve
questions of personal jurisdiction. See Mwani v. bin
Laden, 417 F.3d 1, 7 (D.C. Cir. 2005).
personal jurisdiction analysis requires that a court
determine whether jurisdiction over a party is proper under
the applicable long-arm statute and whether it accords with
the demands of due process.” United States v.
Ferrara, 54 F.3d 825, 828 (D.C. Cir. 1995); accord
GTE New Media Servs. Inc. v. BellSouth Corp.,
199 F.3d 1343, 1347 (D.C. Cir. 2000). There are two distinct
types of personal jurisdiction: general jurisdiction, whereby
a court can entertain claims against the defendant regardless
of the claim's relationship to the forum, and specific
jurisdiction, where jurisdiction is based on acts by the
defendant that touch and concern the forum. D'Onofrio
v. SFX Sports Grp., Inc., 534 F.Supp.2d 86, 90 (D.D.C.
2008). General jurisdiction “sets a high bar, ”
requiring that the defendant have “continuous and
systematic” contacts with the forum state. Id.
Specific jurisdiction, in comparison, requires only
sufficient “‘minimum contacts' with [the
forum], ” but requires that the plaintiffs' claims
arise from those contacts. See Helicopteros Nacionales de
Colombia, S.A. v. Hall, 466 U.S. 408, 414 (1984)
(quoting International Shoe Co. v. Washington, 326
U.S. 310, 316 (1945)). For claims brought pursuant to
courts' specific jurisdiction, the relationship between
the defendant, the forum, and the litigation “is the
essential foundation of [personal] jurisdiction.”
diversity-jurisdiction case, “the federal district
court's personal jurisdiction over the defendant is
coextensive with that of a District of Columbia court.”
Helmer v. Doletskaya, 393 F.3d 201, 205 (D.C. Cir.
2004). Accordingly, an assertion of personal jurisdiction
here must comply with Due Process and District of Columbia
law. Under D.C. law, “personal jurisdiction is
determined as of the commencement of an action.”
Roz Trading Ltd v. Zeromax Grp., Inc., 517 F.Supp.2d
377, 384 (D.D.C. 2007).
Haley Bader argues that this Court lacks personal
jurisdiction, because Plaintiffs have shown neither
“continuous and systematic” contacts between
Haley Bader and the District of Columbia, nor any specific
set of contacts with an adequate nexus to Plaintiffs'
claims. The Court will address these contentions in order.
of Columbia courts may exercise general jurisdiction
“over a person domiciled in, organized under the laws
of, or maintaining his or its principal place of business
in” the District of Columbia. D.C. Code § 13-422.
D.C. Code § 13-334(a) also authorizes the exercise of
general jurisdiction over “a foreign corporation doing
business in the District.” Gorman v. Ameritrade
Holding Corp., 293 F.3d 506, 509 n.1 (D.C. Cir. 2002).
However, jurisdiction under § 13-334(a) requires
“that personal service be made within the District of
Columbia.” See Everett v. Nissan Motor Corp. in
U.S.A., 628 A.2d 106, 108 (D.C. 1993). Here, Plaintiffs
allege that Haley Bader was a Virginia Professional Limited
Liability Company. Am. Compl. ¶ 8. They do not dispute
that Haley Bader dissolved in 2005. See Pls.'
Mem. of Law in Opp'n to Mot. of Def. Haley Bader &
Potts, PLC to Dismiss the Am. Compl. (“Pls.'
Opp'n to Haley Mot.”) at 7, ECF No. 36. Nor do they
deny that Haley Bader was served in Virginia pursuant to
Virginia law. See Id. at 6 n.5.
nonetheless contend that Haley Bader is subject to the
court's personal jurisdiction because the firm “had
continuous and systematic contacts with the District of
Columbia by practicing law before the FCC up until 2000,
” and waived any defects related to service of process
in this case. See Id. at 6 n.5, 7. They further
contend that “‘continuous and systematic
contacts' cannot be determined . . . solely on the basis
of a snapshot at one particular point in time, such as the
filing of the complaint.” See Id. at 7.
syllogism is flawed in three critical respects. First, Haley
Bader's waiver of service of process defects does not
estop it from asserting a defense based on a statutory
prerequisite for personal jurisdiction. In Everett,
the plaintiffs served the out-of-state defendants pursuant to
a District of Columbia Superior Court rule authorizing
service of process by certified mail. 628 A.2d at 108. The
District of Columbia Court of Appeals concluded that by
serving the defendant outside of the District of Columbia,
the plaintiffs “failed to comply with [§
334]'s mandate, and . . . thus [were] foreclosed from
benefitting from its jurisdictional protection.”
See Id. The court highlighted the difference between
general provisions for service of process and the specific
jurisdictional requirements prescribed by statute. See
Id. Here, it does not matter that Haley Bader waived
defects to service of process, because they need not assert
that there was a procedural defect with it. Instead, the sole
inquiry is whether the plaintiffs, by virtue of meeting the
service requirements of D.C. Code § 13-334, became
entitled to assert it as a basis for jurisdiction. Because
they did not, D.C. law precludes the Court from asserting
general personal jurisdiction over Haley Bader.
Haley Bader's 2005 dissolution precludes the Court from
finding general jurisdiction. In Roz Trading Ltd. v.
Zeromax Grp., Inc., the plaintiffs alleged that the
defendant U.S. Zeromax-a group of companies subject to
personal jurisdiction in the District of Columbia-was an
“alter ego” of the foreign Zeromax GmbH, making
the latter subject to general jurisdiction under § 334.
517 F.Supp.2d at 383-84. The court dismissed without reaching
the alter ego issue because U.S. Zeromax was dissolved prior
to the date of the complaint, and “personal
jurisdiction is determined as of the commencement of an
action.” See Id. at 384. The facts here are
analogous. Haley Bader has been dissolved for over a decade,
leaving the Court without power to confer general
jurisdiction, regardless of Plaintiffs' claim that it
merged with Garvey. In an attempt to distinguish these facts
from Roz Trading, Plaintiffs boldly assert that the
court there found a lack of personal jurisdiction
“because the plaintiffs failed to allege that the
defendants acted within the District of Columbia at any
time.” See Pls.' Opp'n to Haley Mot.
at 6-7. Plaintiffs' argument conflates general
jurisdiction with specific jurisdiction. See Id. at
6 (citing to page 387 of Roz Trading); Roz
Trading, 517 F.Supp.2d at 387 (addressing specific
jurisdiction). It is true that the Roz Trading court
found that the plaintiffs failed to meet their burden of
showing personal jurisdiction because the complaint merely
“parrot[ed] the relevant statutory language, proffering
no factual allegations whatsoever, ” see 517
F.Supp.2d at 387, but it did so with respect to
Plaintiffs are incorrect in their assertion that the filing
of the complaint is merely one possible data point that could
show that the court has general jurisdiction. To be sure,
analyzing general jurisdiction often requires retrospective
analysis of events connecting the party with the forum.
See, e.g., In re Orshansky, 804 A.2d 1077,
1091 (D.C. 2002). But the past connections between a party
and a forum matter only insofar as they shed light on
whether, at the time of filing, the contacts are sufficiently
“continuous and systematic” to justify the
assertion of jurisdiction over any claim-whether
related to those contacts or not-against the party. See
Roz Trading, 517 F.Supp.2d at 384-85; Gorman v.
Ameritrade Holding Corp., 293 F.3d 506, 509- 10 (D.C.
Bader was not domiciled in the District of Columbia or
organized under District of Columbia law, and did not
maintain its personal place of business here. It was not
served in the District Columbia, and did not exist as an
entity when the Complaint was ...