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Gray v. Staley

United States District Court, District of Columbia

December 15, 2016

LINWOOD GRAY, Plaintiff,
HARRY L. STALEY, et al., Defendants.


          Amit P. Mehta United States District Court Judge

         Plaintiff Linwood Gray filed this lawsuit in May 2014, seeking to hold Defendants Harry Staley, Joann Hartley Staley, and Annis Alston Staley liable for a variety of common law tort claims arising from the alleged misappropriation of assets Plaintiff gave the Defendants and subsequent fraudulent concealment. The court dismissed Plaintiff's Complaint with prejudice after determining all his claims were time barred. See Gray v. Staley, 310 F.R.D. 32 (D.D.C. Aug. 10, 2015).

         This case returns to the court on remand from the Court of Appeals. The Court of Appeals directed this court “to consider whether the statute of limitations applicable to [Plaintiff's] claims was tolled under D.C. Code § 12-302(a)(3)” while Plaintiff was incarcerated. Gray v. Staley, No. 15-7097 (D.C. Cir. Aug. 29, 2016). After thoroughly reviewing the ascertainable facts, the court concludes that Plaintiff's claims tolled for a period of time but nonetheless remain time barred. Accordingly, the court reaffirms its dismissal of Plaintiff's Complaint with prejudice and formally denies Plaintiff's Motion for Reconsideration.

         I. BACKGROUND

         The basic facts, as alleged in Plaintiff's Complaint, are as follows:

[B]eginning in 1977, Plaintiff Linwood Gray and Defendant Harry Staley discussed possible investment opportunities, including the option of purchasing McDonald's franchises. In 1978, the two men opened an insurance company to generate income to purchase the franchises. Plaintiff contributed $25, 000 toward the company, as well as a new Cadillac that was intended to be the company car.
In 1982, Gray entered into another arrangement with Harry Staley, as well as Harry's then-wife, Defendant Joann Staley. Plaintiff had his residence transferred into the control of Harry and Joann, who were to hold the property on Plaintiff's behalf. Thereafter, without Plaintiff's knowledge, Harry and Joann acquired a personal loan against the property.
Several years later, in 1985, Gray asked Harry and Joann to take out a loan against his residence to save the property from foreclosure. Harry and Joann then allegedly lied to Plaintiff, claiming that they could not find a lender, and failed to inform him that they already had encumbered the home with a personal loan. In late 1985, the house was sold at a foreclosure auction. Without Gray's knowledge, Harry and Joann received $50, 000 from the sale.
Fast-forward 26 years to 2011. In mid-2011, Gray allegedly learned for the first time that Harry and his new wife, Defendant Annis Staley, “had secretly opened ‘seven' McDonald's franchises, in the state of New Jersey without apprising Plaintiff of their acquisitions, ” using “Plaintiff's capital . . . to make the initial franchise acquisitions.” An email attached to Plaintiff's complaint shows that on May 26, 2011, he asked a friend named Johnnie Ervin to “run down a guy named Harry L. Staley. . . . Could be the owner of a few McDonalds and possibly live in NJ, [which is] the last address I had on him.” Five days later, on May 31, 2011, Ervin wrote back confirming that Staley indeed was the owner of seven McDonald's franchises.
. . . .
On May 28, 2014, almost three years to the day after he received the email from Ervin, Gray filed suit against the Defendants. Asserting that Defendants' McDonald's franchises were financed in part by profits from his investments and the sale of his house, Plaintiff brought various claims against Defendants: (1) aiding and abetting; (2) constructive fraud; (3) civil conspiracy; (4) unjust enrichment; (5) breach of fiduciary duty; (6) violation of the Uniform Partnership Act; (7) false misrepresentation; and (8) fraudulent concealment.

Id. at 34-35 (citations and footnote omitted).

         Plaintiff has a long history of criminal activity and convictions. In 1979, while Plaintiff was serving a sentence for income tax offenses, Plaintiff and Defendant Harry Staley were indicted on charges of conspiracy to extort and conceal property and concealment of property from the Internal Revenue Service. See United States v. Gray, 788 F.2d 1031 (4th Cir. 1986). The property at issue in United States v. Gray is the same house that Plaintiff, in this matter, claims he gave Harry Staley and which Harry and Joann Staley purportedly misappropriated. See Gray, 310 F.R.D. at 38-39. Plaintiff and Harry Staley were convicted, awarded a new trial on appeal, and convicted a second time. See United States v. Gray, 852 F.2d 136, 137-38 (4th Cir. 1988). Plaintiff was sentenced to eight years' imprisonment. Id. at 138.

         Plaintiff was released from prison sometime before December 1992. Although Plaintiff's precise date of release is unknown, it is clear he was not incarcerated as of December 1992, when the Drug Enforcement Agency observed Plaintiff and a cooperating witness exchange heroin and cash for jewelry Plaintiff believed was stolen. See United States v. Bracey, 104 F.3d 359, 1996 WL 741129, at *2 (4th Cir. 1996) (per curiam). Plaintiff was arrested on June 9, 1994, and subsequently convicted of conspiracy to distribute heroin and cocaine ...

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