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Brady v. Liquidity Services, Inc.

United States District Court, District of Columbia

November 29, 2018

DANIEL BRADY, Plaintiff,
v.
LIQUIDITY SERVICES, INC., Defendant.

          MEMORANDUM OPINION

          ROYCE C. LAMBERTH UNITED STATES DISTRICT JUDGE

         Before the Court is defendant Liquidity Services, Inc.'s (LSI) Motion to Dismiss. After having considered the motion, the opposition and reply thereto, and the record herein, the Court will GRANT LSI's Motion to Dismiss.

         I. BACKGROUND

         Plaintiff Daniel Brady worked as Vice President of Finance for LSI from 2013 until his termination in 2016. Compl. ¶¶ 1, 85. LSI had entered into a revenue sharing agreement with the Defense Logistics Agency (DLA), a federal government agency, to sell excess scrap metal from military bases. Id. ¶¶ 2, 3, 17, 20-21, 72.

         In 2016, Brady completed an assignment to "develop an activity-based and/or resource-based approach to allocate IT expenses to each business unit for the FY 17 Budget," and Brady found that this new approach resulted in "significantly" lower IT costs for FY16 and FY17, as it related to LSI's "profit-sharing Scrap business." Id. ¶¶ 65-66:

         Brady's direct supervisor, LSI's Chief Financial Officer Jorge Celaya, called to discuss LSI's "scrap metal contract," or revenue sharing agreement, with the DLA. Id. ¶ 31. In response to Celaya's questions, Brady said that "if LSI had less IT costs . . . LSI would need to share with the government" as "a matter of proper accounting and federal mandates." Id. ¶¶ 75, 77. Celaya replied, "I'm not sure if I see it that way." Id. ¶ 78. Brady replied that "doing it any other way would be illegal." Id. ¶ 6.

         Brady immediately reported his conversation with Celaya to LSI's Chief Accounting Officer and "expressed his concerns about the measures Celaya would use." Id. ¶¶ 7-9, 79-80. The Chief Accounting Officer told Brady not to worry about it. Id. ¶ 80.

         Days later, Celaya fired Brady. Id. ¶¶ 8, 81, 83. However, Brady had unused paid time off and remained an LSI employee until November 1, 2016. Id. ¶¶ 84-85.

         In Count I of the Complaint, Brady alleges retaliation under § 3730(h) of the False Claims Act, 31 U.S.C. §§ 3729 et seq. Brady argues that he engaged in protected activity twice: (1) when 1 he told Celaya "about proper accounting protocols that must be followed on LSI's scrap metal contract with the Defense Logistics Agency and that any other approach would be illegal," and (2) when he "reported concerns about an impending violation to the Chief Accounting Officer." Id. ¶¶ 94-95. Brady claims that he "disclosed potential accounting fraud" and was terminated "only days later." Id. at 8.

         In Count II, Brady alleges that LSI violated § 32-1301 of the D.C. Wage Payment and Collection Law (DCWPCL), D.C. Code § 32-1301 et seq., by failing to pay his "earned 2016 bonus." Id. ¶¶ 105-06. "Per [his] offer letter," Brady claims that the bonus amount is approximately $62, 000, based on "qualitative and quantitative measures established by LSI as part of the Capital Assets Group." Id. ¶¶ 89. Brady alleges that, according to his offer letter, LSI will pay him a forty percent target bonus annually. Id. ¶ 86. Although "the offer letter does not state when the payment will be made or that Brady must be employed on a certain date to receive the bonus," Brady claims that the bonus "generally occurs within 60 days" of the fiscal year's end on September 30. Id. ¶¶ 87-88.

         II. LEGAL STANDARD

         A. Rule 12(b)(6)

         To survive a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), "a complaint must contain sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A plaintiff must furnish "more than labels and conclusions" or "a formulaic recitation of the elements of a cause of action." Twombly, 550 U.S. at 555. Instead, the complaint's "[f]actual allegations must be enough to raise a right to relief above the speculative level, on the assumption that all the allegations in the complaint are true (even if doubtful in fact)." Id. (internal citations omitted). While FCA actions for fraud are evaluated under the heightened pleading standard of Rule 9(b), retaliation claims are evaluated under the standard Rule 8 pleading standard. United States ex rel. Williams v. Martin-Baker Aircraft Co., Ltd., 389 F.3d 1251, 1259- 60 (D.C. Cir. 2004).

         B. FCA ...


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