United States District Court, District of Columbia
OPINION DENYING PLAINTIFF'S MOTION TO STRIKE; DENYING
DEFENDANTS' MOTION TO DISMISS AND TO COMPEL ARBITRATION;
GRANTING IN PART AND DENYING IN PART PLAINTIFF'S MOTION
FOR SUMMARY JUDGMENT; GRANTING DEFENDANTS' COUNSEL'S
MOTION TO WITHDRAW RE DOCUMENT NO. 7, 10, 15, 27
RUDOLPH CONTRERAS UNITED STATES DISTRICT JUDGE
Owen Partridge brought this action, which seeks to recover
unpaid wages against American Hospital Management Company,
LLC ("LLC"); American Hospital Management Company,
LMT ("LMT"); and Randall D. Arlett, who is
President, Chief Executive Officer, and Managing Director of
both corporations. Before this Court considered a motion to
dismiss and to compel arbitration filed by Defendants or
reached the merits of Mr. Partridge's claims, the parties
entered into a settlement agreement, which the Court approved
and incorporated into a consent decree. Unfortunately,
however, entry of the settlement agreement and consent decree
did not end this dispute. Several payment deadlines have
passed but, according to Mr. Partridge, no money has changed
hands. Consequently, the Court has agreed to revisit and rule
on the parties' three pre-settlement motions: (1)
Plaintiffs motion to strike an errata sheet filed by
Defendants, (2) Defendants' motion to dismiss and to
compel arbitration, and (3) Plaintiff's motion for
summary judgment. Also before the Court is a motion by
Defendants' counsel requesting permission to withdraw his
representation. For the reasons explained below, the Court
denies Plaintiff's motion to strike and denies
Defendants' motion to dismiss and to compel arbitration.
The Court grants Plaintiff's motion for summary judgment
against Defendant LMT on the breach of contract count, but
otherwise denies Plaintiff's motion. The Court also
grants Defendants' counsel's motion to withdraw.
Partridge initiated this action against his former
employers-LLC, LMT, and Mr. Arlett-alleging that they have
failed to pay him more than $107, 000 in wages that he earned
managing a hospital facility on their behalf in Tbilisi,
Georgia. Compl. ¶¶ 13-14, 23, 37, ECF No. 2. In
Count One of his Complaint, Mr. Partridge claims that
Defendants breached two separate employment agreements
(collectively "the Agreements")-a two-year
agreement that he had entered with LMT in December 2015
("First Agreement") and another agreement that he
had entered with either LCC or both LLC and Mr. Arlett in or
about August 2016 ("Second Agreement") which
purported to ensure strict compliance with the terms of the
First Agreement.Id. ¶¶ 14, 23, 25-26,
29, 41-43. Mr. Partridge also contends that Defendants
violated the District of Columbia Wage Payment and Collection
Law by withholding wages (Count Two) and committed fraud by
misrepresenting their intent to perform under the Agreements
(Count Three). Id. ¶¶ 44-57. In
addition, Mr. Partridge seeks a judgment declaring that a
non- competition provision in the First Agreement is invalid
as an unreasonable restraint on trade (Count Five).
Id. ¶¶ 65-72. The relevant provisions
During the term of [the First Agreement], [Mr. Partridge]
shall devote his work efforts exclusively to the performance
of this Agreement and shall not, without [LMT's] prior
written consent, render to others services of any kind for
compensation, or engage in any other business activity that
would materially interfere with the performance of his duties
under this Agreement. [Mr. Partridge] cannot work directly
for Sayali Group D/B/A American Hospital Tbilisi during this
During the [First Agreement] term, [Mr. Partridge] shall not,
in any fashion participate or engage in any activity or other
business competitive with [LMT]. In addition, [Mr.
Partridge], while engaged by [LMT] shall not take any action
without [LMT's] prior written consent to establish, form,
or become employed by a competing business on termination of
employment by [LMT]. [Mr. Partridge's] failure to comply
with the provisions of the preceding sentence shall give
[LMT] the right (in addition to all other remedies [LMT] may
have to terminate any benefits that [Mr. Partridge] maybe
otherwise entitled to following termination of this
Compl., Ex. A. at 2-3, ECF No. 2.
[LLC] and Randall Arlett" moved to dismiss the Complaint
and to compel arbitration. See Mem. Supp. Defs.'
Mot. Dismiss for Lack of Subject Matter Jurisdiction, to
Compel Arbitration and Failure to State a Claim at 5-8
("Defs.' Mot. Dismiss"), ECF No. 7. Counsel for
Defendants later filed an errata sheet, which clarified that
the motion to dismiss had been submitted on behalf of all
three Defendants. See Defs.' Erratta [sic] Sheet
to Its Mot. Dismiss ("Errata Sheet") at 1, ECF No.
14. The motion to dismiss pointed to an arbitration clause in
the First Agreement, which states:
Any controversy or claim arising out of or relating to this
Agreement shall be settled by arbitration in accordance with
the Commercial Arbitration Rules of the American Arbitration
Association, and Judgment on the award rendered by the
arbitrators may be entered in any court having jurisdiction.
... An arbitration hearing shall consist of three
arbitrators, one to be chosen directly by each party at will,
and the third arbitrator to be selected by the two
arbitrators so chosen. Each party shall pay the fees of the
arbitrator he selects and of his own attorneys, and the
expenses of his witnesses and all other expenses connected
with presenting his case. Other costs of the arbitration,
including the cost of any record or transcripts of the
arbitration, administrative fees, the fees of the third
arbitrator, and all other fees and costs, shall be borne
equally by the parties. Despite the forgoing, the arbitrators
may assign to one party or the other any and all fees and
costs as part of any arbitration award.
Ex. A at 5, ECF No. 2. Defendants also asked the Court to
dismiss any claims asserted against Mr. Arlett as an
individual, arguing that Mr. Arlett had not signed any
agreement with Mr. Partridge in his personal capacity and
that no pleading justified piercing the corporate veil to
hold Mr. Arlett liable for any actions taken by LLC and LMT.
Defs.' Mot. Dismiss at 4-5.
after, Mr. Partridge asked the Court to strike counsel's
errata sheet, arguing that LMT had purposely declined to join
the motion to dismiss and that an errata sheet could not be
used to join a motion to dismiss. See Mot. to Strike Errata
Sheet ¶¶4-7, ECF No. 15. Mr. Partridge also opposed
Defendants' motion to dismiss and to compel arbitration
and moved for summary judgment on his claims. See Pl's.
Mem. in Opp'n to Mot. to Compel Arbitration and in
Support of Pl's. Cross-Mot. Summ. J. ("Pl's.
Opp. Mot. Dismiss"), ECF No. 9; Cross-Motion for Summ.
J. ("Pl's. MSJ"), ECF No. 10.
considering the pending motions-and at the request of the
parties-this Court referred the case for mediation so that
the parties could explore the possibility of settlement.
See Order Referring Case to Magistrate Judge for
Mediation, ECF No. 20; see also Rule 26(f) Report
and Joint Proposed Discovery Plan at 3, ECF No. 19
(requesting referral for mediation). While settlement
discussions were in progress, Defendants' counsel moved
to withdraw his representation, explaining that
"Defendant has been unable to abide by the terms of its
agreement with counsel." Counsel Mot. To Withdraw ¶
1, ECF No. 27. Specifically, according to counsel,
"Defendants have not fulfilled their obligation to
communicate with Counsel." Defs.' Counsel Reply
Pl's. Resp. to Its Motion to Withdraw at 1, ECF No. 32.
The "lack of communication has le[d] to a deteriorated
attorney-client relationship, " counsel claims.
Id. at 1-2. Moreover, counsel asserts that
Defendants have "outstanding legal bills in
arrears." Id. at 2. Counsel maintains that his
withdrawal can be accomplished with minimal prejudice.
Id. at 3.
10, 2017, with Defendants' counsel's withdrawal
motion still under advisement, Mr. Partridge filed a motion
with the Court, which supplied the parties' settlement
agreement and asked the Court to incorporate its terms into a
consent decree. See Mot. to Enter Settlement
Agreement, ECF No. 28. The settlement agreement-which, per
its terms, became enforceable when Mr. Arlett signed it on
June 19, 2017-specified that the Defendants would provide Mr.
Partridge an initial payment of $50, 000 by July 19, 2017.
Consent Decree ¶¶ 1, 11, ECF No. 31. "Upon
receipt of the Initial Payment, " the parties would
"release and covenant not to sue each other" and
would "lodge a consent decree memorializing these terms
and, except as necessary to enforce the decree, dismiss the
litigation." Id. ¶¶ 4-5. Thereafter
LLC and LMT would pay Mr. Partridge $10, 000 each month until
the initial and monthly payments totaled $150, 000.
Id.¶2. If LLC and LMT failed to make a monthly
payment on time and failed to cure the default within five
calendar days, the agreement established that "the Court
shall enter judgment against [the corporations] for the
entire unpaid balance plus all costs of collection, including
attorney's fees pursuant to D.C. Code §
32-1308." Id. ¶ 6. The parties explicitly
"consent[ed] to the continuing jurisdiction of the
United States District Court for the District of Columbia
unless and until Plaintiff receives Initial and Monthly
Payments totaling $150, 000." Id. ¶ 10. On
July 12, 2017, this Court entered a consent decree, which
fully incorporated the parties' settlement agreement.
See Id. That same day, the Court denied as moot
Defendants' motion to dismiss and Plaintiff's motion
for summary judgment. See Minute Order (July 12,
2017). Defendants' counsel's motion to withdraw
remained under advisement.
little more than a month later, Mr. Partridge moved for an
order requiring Defendants to show cause why they should not
be held in contempt for allegedly violating the consent
decree. App. for a Rule to Show Cause Why Defs. Should Not Be
Held in Contempt of Court, ECF No. 35. According to Mr.
Partridge, "despite [Mr.] Arlett's representations
that he would make payments, that he already had made
payments, and that he would provide confirmation of payments,
" no payments-not even the initial payment of $50,
000-have been made. Id. at 1 & ¶ 11. At the
first of two status conferences held shortly after Mr.
Partridge filed his show cause motion, the Court explained
that it had viewed Defendants' payment of the initial
$50, 000 as a condition precedent to the parties' filing
of the consent decree. Having heard for the first time
through Plaintiff's show cause motion that no initial
payment had been made, this Court thought it unwise to merely
enforce the terms of the consent decree. Rather, the Court
agreed to revisit the parties' pre-settlement motions.
Court ordered Mr. Arlett to appear for a second status
conference to be held the next month. See Order, ECF
No. 36 ("[T]he parties, including individual Defendant
Randall Arlett, shall appear for a status conference on
September 19, 2017. .. ."). Mr. Arlett belatedly
notified Plaintiffs counsel and this Court that he was
"not able to appear today in person" because he
resides and works in Saudi Arabia. Letter from Randall Arlett
("Arlett Letter"), ECF No. 41 (time-stamped
September 19, 2017 at 7:40 A.M.); see also Letter
(Fax) from Steve Oster, ECF No. 39. In that same message, Mr.
Arlett affirmed that Defendants "do not oppose"
their counsel's motion to withdraw. Arlett Letter, ECF
No. 41. He asked, however, for "a 30 day continuance to
seek new counsel and allow the new counsel adequate time to
prepare and respond in this matter." Id. He
also represented that Defendants "have already started
to seek new counsel and expect to have retained by the end of
this week." Id. Although that representation
was made on September 19, 2017, more than three months have
elapsed without any new counsel entering an appearance on
before the Court are Mr. Partridge's motion to strike
Defendants' errata sheet, Defendants' motion to
dismiss, Mr. Partridge's motion to summary judgment, and
Defendants' counsel's motion to withdraw from this
Plaintiff's Motion to Strike is Denied
Court first considers Mr. Partridge's motion to strike
Defendants' counsel's errata sheet. See Mot.
to Strike Errata Sheet, ECF No. 15. Mr. Partridge argues that
the errata sheet, which clarified that Defendants'
counsel had intended to submit the motion to dismiss on
behalf of all three defendants, is not the appropriate means
through which to join a motion to dismiss. See Id.
at 1. "The use of errata sheets, " he contends,
"is restricted to correcting typographic, stenographic,
or other inconsequential errors." Id.¶\.
Furthermore, he asserts that Defendants' counsel made a
strategic decision to leave LMT off of the motion to dismiss.
See Id. ¶¶ 5-6. And he argues that
"if permitted Plaintiff will be prejudiced by having
already responded to a Motion that subsequently was
substantively altered without leave of Court."
Id. ¶ 7. The Court disagrees.
decision to grant or deny a motion to strike is vested in the
trial judge's sound discretion." Canady v. Erbe
Elektromedizin GmbH, 307 F.Supp.2d 2, 7 (D.D.C. 2004).
Courts generally disfavor such motions. See
Stabilisierung fonds Fur Wein v. Kaiser Stuhl Wine
Distributors Pty. Ltd., 647 F.2d 200, 201 (D.C. Cir.
1981) (per curiam). A court may, however, strike an untimely
filing or decline to allow a party to supplement a filing
when doing so promotes the fair and efficient administration
of justice. See Jackson v. Finnegan, Henderson, Farrabow,
Garrett & Dunner, 101 F.3d 145, 150-53 (D.C. Cir.
1996) (affirming district court's denial of motion to
supplement summary judgment filings); cf. Randolph v. ING
Life Ins. & Annuity Co., 486 F.Supp.2d 1, 9 n.5
(D.D.C. 2007) (striking a surreply submitted without leave of
Court concludes that, under the circumstances of this case,
it would be imprudent to strike Defendants' counsel's
errata sheet. True enough, errata sheets are typically-and,
perhaps, appropriately-used only to correct inconsequential
errors. And instead of filing an errata sheet,
Defendants' counsel likely should have sought leave to
amend his motion to dismiss or requested an extension to
permit him to file a separate motion to dismiss on behalf of
LMT. But it is difficult to gather why the styling of
Defendants' counsel's filing should predominate the
Court's analysis. In all cases, the Court has substantial
discretion to permit the filing. See Cohen v. Bd. of
Trustees of the Univ. of theDist. of Columbia, 819 F.3d
476, 479-80 (D.C. Cir. 2016) (describing the discretion
afforded to district courts to determine whether to extend a
deadline even after the time to act has expired);
Canady, 307 F.Supp.2d at 7 (explaining that the
decision whether to grant a motion to strike is vested in the
district court's discretion). The Court is simply not
persuaded that Defendants' counsel acted in bad faith in
neglecting to include LMT in the motion to dismiss. Nor is
the Court convinced that Plaintiff has suffered substantial
prejudice due to the clarification. Mr. Partridge seemingly
hopes that the Court will strike counsel's errata sheet,
find that LMT failed to timely answer the complaint, declare
LMT in default, and proceed toward a default judgment. As the
Court explained in Canady, "[s]uch a result .
.. would contravene the established policies disfavoring
motions to strike, and favoring the resolution of cases on
their merits." 307 F.Supp.2d at 8 (citation omitted).
Accordingly, the Court denies Plaintiff's motion to
Defendants' Motion to Dismiss and to Compel Arbitration
Court next considers Defendants' motion to dismiss and to
compel arbitration. First, Defendants argue that the Court
should dismiss any claims asserted against Mr. Arlett in his
personal capacity under Federal Rule of Civil Procedure
12(b)(6). Defs.' Mot. Dismiss at 4-5. Second, Defendants
ask the Court to compel arbitration of claims asserted
against LLC and LMT pursuant to an arbitration clause in the
First Agreement. Id. at 5-8. For the reasons set
forth below, the Court denies both requests.
The Court Denies Defendants' Motion to Dismiss Mr. Arlett
as a Defendant
Court begins with Individual Defendant Arlett's argument
that the complaint fails to allege facts sufficient to
support liability against him on any claim. Given the liberal
pleading standard of Rule 12, the Court concludes that Mr.
Partridge's allegations against Mr. Arlett are sufficient
to survive a motion to dismiss.
motion to dismiss under Federal Rule of Civil Procedure
12(b)(6) "tests the legal sufficiency of a
complaint." Browning v. Clinton,292 F.3d 235,
242 (D.C. Cir. 2002). To survive a 12(b)(6) motion, a
complaint must contain "a short and plain statement of
the claim showing that the pleader is entitled to
relief." Bell Ail. Corp. v. Twombly, 550 U.S.
544, 555 (2007) (quoting Fed.R.Civ.P. 8(a)(2)). Detailed
factual allegations are not required, but the plaintiff must
plead facts sufficient to "raise a right to relief above
the speculative level on the assumption that all of the
complaint's allegations are true." Id. When
ruling on a Rule 12(b)(6) motion, "the Court may only
consider the facts alleged in the complaint, documents
attached as exhibits or incorporated by reference in the
complaint, and matters about which the Court may take
judicial notice." Gustave-Schmidt v. Chao, 226
F.Supp.2d 191, 196 (D.D.C. 2002). The Court must construe the
complaint liberally in the plaintiff's favor and grant
the plaintiff the benefit of all reasonable inferences.
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