DAISLEY v. RIGGS BANK N.A. et al
Memorandum Opinion. Signed by Judge Henry H. Kennedy, Jr., on May 31, 2005. (FL, ) Additional attachment(s) added on 6/8/2005 (lc, ).
D A I S L E Y v. RIGGS BANK N.A. et al
D o c . 17
U N I T E D STATES DISTRICT COURT F O R THE DISTRICT OF COLUMBIA
ALEXANDER M. DAISLEY, P la in tif f, v. R I G G S BANK, N.A., et al., D e f e n d a n ts . C iv il Action 03-01820 (HHK)
MEMORANDUM OPINION P l a i n t i ff, Alexander Daisley, brings this action against Riggs Bank, N.A. ("Riggs") and its o ffic e r, Robert Roane (collectively, "bank defendants"), and against the United States D e p a r tm e n t of Treasury ("Treasury") and its employee, Jack McGuire (collectively, "federal d e fe n d a n t s " ). Daisley, a former employee of Riggs, was terminated in August 2001. He alleges th a t McGuire and Roane unlawfully conspired to orchestrate Daisley's termination, and brings a d d itio n a l claims against Roane for malicious intentional interference with employment re la tio n s h ip and for fraud; against both Riggs and Treasury for negligent hiring and supervision; a n d against Riggs for breach of contract, promissory estoppel, and for an accounting. Before the c o u rt are bank defendants' motion to dismiss [#3], and federal defendants' motion to dismiss or in the alternative for summary judgment [#10]. Upon consideration of these motions, the o p p o s itio n s thereto, and the record of this case, the court concludes that federal defendants' m o t io n must be granted, and bank defendants' motion must be granted in part and denied in part. I. FACTUAL BACKGROUND
A le x a n d e r Daisley was employed by Riggs from May 24, 1999 to late August 2001. Compl. ¶¶ 39, 127. In 1988, Riggs had developed Treasury's "cash management application," k n o w n as CA$HLINK, id. ¶¶ 15-16, which Riggs operated with Treasury's Financial M a n a gem e n t Service ("FMS"). Id. ¶¶ 12, 14. In 1996, Treasury began work on CA$HLINK II, a n enhanced version of the original system, id. ¶¶ 13-16, and subsequently sought bids from "all
of the major US-based banks" to manage the project. Id. ¶ 12. Daisley then worked for a b u s in e s s and technology consulting company which Riggs hired to assist with its CA$HLINK II b id , id. ¶¶ 10, 12, and during the bidding process he became acquainted with Riggs senior e x e c u t iv e s , including Timothy Lex, its then-Chief Operating Officer, and David Hoffman, its th e n -C h ie f Information Officer. Id. ¶¶ 9, 18-21. Although Riggs "made its initial employment o v e rtu re s " to Daisley in December 1998, id. ¶ 23, these recruiting efforts intensified upon T re a s u ry's selection of Riggs to run CA$HLINK II in February 1999. Id. ¶¶ 20, 23. Daisley was in itia lly reluctant to leave his previous position and home to work for Riggs, id. ¶¶ 25-26, but H o ffm a n and Lex assured him he would be guaranteed a "minimum six-year term of e m p l o ym e n t " as well as an "enhanced compensation package." Id. ¶¶ 26-28. Daisley in t e rv i e w e d with Riggs executives, including Lex, and Hoffman, and the bank's then-Chief E x e c u tiv e Officer, in April 1999. Id. ¶ 31. After this visit, and the signing of the formal legal a g re e m e n t between Treasury and Riggs for the development and management of CA$HLINK II in e a rly May 1999, id. ¶ 35, Riggs presented Daisley with an offer letter "setting forth some, but not a ll, of the components of the verbal offers and commitments" Daisley had previously received fro m Lex and Hoffman. Id. ¶ 36. Daisley signed the offer letter, but "with the understanding that h i s term of employment was for a minimum of six years" and that he would receive the `enhanced c o m p e n s a tio n package' he had previously discussed with Lex and Hoffman, id. ¶ 37. He began w o r k at Riggs on May 24, 1999, as Senior Vice President, and President of Riggs Enterprise S o lu tio n s . Id. ¶ 39. Lex resigned from Riggs that same day, replaced as Chief Operating Officer b y Robert Roane. Id. ¶ 40. Daisley's new position placed him in regular contact with Treasury employees, including J a c k McGuire of the FMS division, as Riggs began implementing CA$HLINK II. Id. ¶ 41, 200. In the third quarter of 1999, Treasury issued its first change request. Id. ¶ 41. Daisley expressed c o n c e r n that the change would force Riggs to bear higher costs than originally called for in its a gree m e n t with Treasury. Id. ¶ 44. He therefore negotiated on behalf of Riggs for Treasury to
absorb an additional $9,834,420 of the change request. Id. During and after these discussions, th e relationship between Riggs and Treasury became strained, "primarily because Defendant T re a s u ry did not want to pay more money to Defendant Riggs for CA$HLINK II Change R e q u e s ts , even though these changes had been initiated by Defendant Treasury." Id. ¶ 46. Treasury issued no fewer than twelve additional change requests for CA$HLINK II d u rin g the rest of Daisley's tenure with Riggs. Id. ¶¶ 69, 81-82, 89-90, 103. Upon each of these c h a n g e requests, the relationship between Treasury and Riggs became increasingly antagonistic b e c a u s e of Treasury's resistance to paying for the related cost overruns. Id. ¶¶ 75, 93, 106. McGuire, for instance, told Daisley that "other banks worked for Treasury for free" and that he " d i d not understand why Riggs Bank would not do the same." Id. ¶ 113. Daisley, however, successfully negotiated for Treasury to pay additional money for ten of th e change requests. Id. ¶¶ 69, 81-82, 89-90. As a "direct result of [Daisley's] negotiations," T r e a s u ry's total costs for CA$HLINK II increased nearly $14,000,000 over its original c o m m itm e n t to Riggs. Id. ¶ 109. Daisley thus became the "proverbial `thorn in the side' of D e fe n d a n t Treasury" because he "resisted numerous efforts" by his Treasury counterparts to have R iggs bear costs for which Treasury had failed to budget. Id. ¶ 134. Roane, on the other hand, took a more "conciliatory" approach towards Treasury. Id. ¶ 1 0 9 . Because he had difficulty understanding the technical aspects of CA$HLINK II, Treasury s ta ff easily "outmaneuvered" him, id. ¶¶ 52, 71, 110, and he acceded to Treasury's requests, even w h e n the department refused to pay for its own change orders. Id. ¶¶ 103, 106, 108. Roane's a p p ro a c h established a "precedent" that Treasury personnel should try to "work around" Daisley in order to "achieve Defendant Treasury's aims." Id. ¶ 71. Roane also came to resent both Daisley's technical expertise, id. ¶ 145-46, and his fin a n c ia l compensation from Riggs. Id. ¶ 71. As a result, Roane began to undermine Daisley's p o s itio n with Treasury and sought to convince "representatives at Defendant Treasury that [D a is le y] had to go." Id. ¶¶ 71, 74, 108, 122.
The "internal situation" at Treasury also presented difficulties for Daisley. Id. ¶ 111. Treasury lacked a sufficient number of employees with the technical skills necessary to manage C A $ H LIN K II, id., forcing Daisley to deal with "incompetent and malicious officials at D e fe n d a n t Treasury" such as McGuire and his supervisor, Ken Carfine. Id. ¶¶ 91, 207. As C A $ H LIN K II exceeded Treasury's budget, McGuire and other Treasury personnel became in c re a s in gly combative and "consistently challenged" Daisley. Id. ¶¶ 109-10, 115. The department's budget woes led Treasury, with "input and prodding" from McGuire a n d Roane, to seek a "scapegoat" in Daisley. Id. ¶ 116. McGuire, like Roane, came to dislike D a is le y and resent his technical skills. Id. ¶ 145-46. McGuire's technical inadequacies and fa ilu re to properly allocate funding led him to place the blame for CA$HLINK II problems o u ts id e of Treasury and with Daisley in particular. Id. ¶¶ 45, 112, 122, 145. On July 27, 2001, following a dispute over CASHLINK II intellectual property o w n e rs h ip , Treasury demanded that Riggs remove Daisley from CA$HLINK II. Id. ¶¶ 120-22. Riggs' Chief Executive Officer, however, indicated that he would not take action regarding D a is le y until after a CA$HLINK II business meeting between Riggs and Treasury then planned fo r September 12, 2001 ("FMS Summit"). Id. ¶ 125. McGuire and Roane agreed to attack Daisley's performance at the FMS Summit. Id. ¶¶ 1 4 9 - 5 1 . They arranged to advance the date of the FMS Summit to August 19, 2001, when D a is le y was on vacation and could not be present to defend himself. Id. ¶ 148. They further a gree d that McGuire would "take the lead" at the summit in criticizing Daisley. Id. ¶ 149. When D a i s l e y returned from vacation, Roane advised him on August 30, 2001 that the FMS Summit h a d gone forward without him and had resulted in his "forced separation" from Riggs. Id. ¶ 128. This suit followed. II. A. Legal Standard A motion to dismiss for lack of subject matter jurisdiction under Fed. R. Civ. P. 12(b)(1) ANALYSIS
should not be granted "unless plaintiffs can prove no set of facts in support of their claim that w o u ld entitle them to relief." Kowal v. MCI Communications Corp., 16 F.3d 1271, 1276 (D.C. C ir. 1994) (citing Conley v. Gibson, 355 U.S. 41, 45-46 (1957)). In ruling on a motion to dismiss fo r lack of subject matter jurisdiction under Rule 12(b)(1), the court should construe the p la in tiff's complaint liberally, giving him the benefit of all favorable inferences that can be drawn fro m the alleged facts. EEOC v. St. Francis Xavier Parochial Sch., 117 F.3d 621, 624 (D.C. Cir. 1 9 9 7 ). Nonetheless, the plaintiff bears the burden of establishing the court's subject matter ju ris d ic tio n . Pitney Bowes, Inc. v. United States Postal Serv., 27 F. Supp. 2d 15, 19 (D.D.C. 1 9 9 8 ). Additionally, a court may consider such materials outside the pleadings as it deems a p p ro p ria te to resolve the question of whether it has jurisdiction to hear the case. See, e.g., H e r b e r t v. Nat'l Acad. of Scis., 974 F.2d 192, 197 (D.C. Cir. 1992); Haase v. Sessions, 835 F.2d 9 0 2 , 906 (D.C. Cir. 1987). In deciding a motion to dismiss for failure to state a claim under Fed. R. Civ. P. 12(b)(6), th e court must construe the complaint in the light most favorable to the plaintiff and accept as tru e all reasonable inferences drawn from well-pleaded factual allegations. In re United Mine W o r k e r s of Am. Employee Ben. Plans Litig., 854 F. Supp. 914, 915 (D.D.C. 1994). Dismissal is n o t appropriate "unless it appears beyond doubt that the plaintiff can prove no set of facts in s u p p o rt of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46 ( 1 9 5 7 ) .1 B. C la im s
Ordinarily, when a defendant submits extrinsic evidence with a motion to dismiss for failure to state a claim under Fed. R. Civ. P. 12(b)(6), the court must convert that motion into one for summary judgment. See Savage v. Scales, 310 F. Supp. 2d 122, 129 (D.D.C. 2004). However, where as here "a document is referred to in the complaint and [is] central to plaintiff's claim, such a document attached to the motion papers may be considered without converting the motion to one for summary judgment." Lipton v. MCI Worldcom, Inc., 135 F. Supp. 2d 182, 186 (D.D.C. 2001) (citations omitted); see also Pryor v. Nat'l Collegiate Athletic Ass'n, 288 F.3d 548, 560 (3d Cir. 2002). Therefore, the court may consider the executed written offer letter signed by Daisley and a representative of Riggs without converting bank defendants' motion into a motion for summary judgment. 5
1. Breach of Contract U n d e r District of Columbia law, "the mutual promise to employ and serve creates a c o n tra c t terminable `at will' by either party." Bell v. Ivory, 966 F. Supp. 23, 29 (D.D.C. 1997) (c itin g Sullivan v. Heritage Found., 399 A.2d 856 (D.C. 1979)). Both employer and employee m a y terminate an at-will employment relationship "for any reason or no reason at all." Wemhoff v . Investors Mgmt. Corp., 528 A.2d 1205, 1208 n.3 (D.C. 1987) (citing Taylor v. Greenway Rest., In c . , 173 A.2d 211 (D.C. 1961)). At-will employment should not be viewed as the absence of c o n tra c t, but as a "species of contract," a principle "well settled" in the District of Columbia. S h e p p a r d v. Dickstein, Shapiro, Morin & Oshinsky, 59 F. Supp. 2d 27, 32 (D.D.C. 1999) (citing R i n c k v. Ass'n of Reserve City Bankers, 676 A.2d 12, 15 (D.C. 1996)). Termination of e m p lo ym e n t, then, does not breach an at-will employment contract, because by its very terms the a gre e m e n t contemplates that either party may end the employment relationship, with or without c a u s e . See Frazier v. Univ. of District of Columbia, 742 F. Supp. 28, 29 (D.D.C. 1990) (d i s m is s in g breach of contract action because "the District of Columbia does not recognize w r o n g fu l discharge for an at-will employee.") (citations omitted).2 In the District of Columbia, absent express language indicating particular terms or d u ra tio n of employment, the employment relationship is presumed to be at-will. Carter v. G e o r g e Washington Univ., 180 F. Supp. 2d 97, 109 (D.D.C. 2001) (citing Sisco v. Gen. Servs. A d m in ., 689 A.2d 52, 53 (D.C. 1997); United States ex rel. Yesudian v. Howard Univ., 153 F.3d
District of Columbia courts recognize a "very narrow exception to the at-will doctrine" in holding that "an employer engages in tortious conduct when it fires an at-will employee for that employee's refusal to break the law at the employer's direction." Adams v. George W. Cochran & Co., 597 A.2d 28, 34, 29 (D.C. 1991). Although the courts have not created other public policy exceptions to date, they have evidenced a willingness to consider them on a case-by-case basis. See Owens v. Nat'l Med. Care, Inc., 337 F. Supp. 2d 131, 137 (D.D.C. 2004) (discussing Carl v. Children's Hosp., 702 A.2d 159 (D.C. 1997) (en banc)). In addition, at-will employees "undoubtedly" may not be terminated for illegally discriminatory reasons, such as race or gender. Alexis v. District of Columbia, 44 F. Supp. 2d 331, 348 (D.D.C. 1999). Daisley does not contend that Riggs terminated him either for his refusal to break the law or for illegally discriminatory reasons. 6
731, 745 (D.C. Cir. 1998)). This presumption applies unless the parties "state clearly their in t e n t io n to limit the employer's right to terminate," Taylor v. Wash. Metro. Area Transit Auth., 9 2 2 F. Supp. 665, 674 (D.D.C. 1996) (citation and internal quotation marks omitted), such as by a contract provision setting out employment for a fixed term or language that allows termination o n ly for cause. See Hodge v. Evans Fin. Corp., 707 F.2d 1566 (D.C. Cir. 1983). Here, the offer letter states that [a]t all times while you are employed by the Bank, either before or after completion of the In t ro d u c t o r y Period, you will be employed `at-will,' that is, your employment will c o n tin u e only as long as it is mutually agreeable to you and the Bank. Either you or the B a n k may end the employment relationship at any time with or without cause or notice. The `at-will' nature of the employment relationship can only be changed by written a gre e m e n t signed by you and the Director of Human Resources on behalf of the Bank. O ffe r Letter at 3 (Bank Defs.' Mot. to Dismiss, Ex. A). In order to rebut the presumption of at-will employment, and proceed with a cause of a c tio n for wrongful discharge under a breach of contract theory, "a plaintiff must provide e v i d e n c e of clear contractual intent on the part of both the employer and the employee." Lance v. U n i te d Mine Workers of Am. 1974 Pension Trust, 355 F. Supp. 2d 358, 360 (D.D.C. 2005) (citing C h o a t e v. TRW, Inc., 14 F.3d 74, 76 (D.C. Cir. 1994) (internal citations omitted)). Against the l a n g u a g e of the offer letter, Daisley argues that it sets forth "some, but not all, of the components o f the verbal offers and commitments that [Daisley] had received" from Lex and Hoffman. Compl. ¶ 36. Specifically, Daisley alleges that the former Riggs executives offered him " a s s u r a n c e s of a minimum six-year term of employment," id. ¶ 27. Daisley further contends that R o a n e "subsequently reaffirmed Defendant Riggs' commitment to the six-year term of [D a is le y's ] employment and the specific components of [Daisley's] enhanced compensation p a c k a ge ," and that Daisley himself "reaffirmed his acceptance of this oral agreement . . . ," id. ¶ 1 6 4 . In other words, Daisley asserts that his employment with Riggs was not at-will. "Where parties to a contract have executed a completely integrated written agreement, it s u p e rs e d e s all other understandings and agreements with respect to the subject matter of the
agreement between the parties, whether consistent or inconsistent . . . ," Masurovsky v. Green, 6 8 7 A.2d 198, 202 (D.C. 1996) (citing Howard Univ. v. Good Food Servs., Inc., 608 A.2d 116, 1 2 6 - 2 7 (D.C. 1992) (other citation omitted)); see also Bowden v. United States, 176 F.3d 552, 5 5 4 (D.C. Cir. 1999). An "integrated" agreement, in turn, is "a writing or writings constituting a final e x p re s s io n of one or more terms of an agreement." RESTATEMENT (SECOND) OF CONTRACTS § 2 0 9 ( 1 ) (1981); see also Good Food, 608 A.2d at 126 (an agreement is "completely integrated" if it is "adopted by the parties as the complete and exclusive statement of the terms of the a gree m e n t.") (quoting Ozerol v. Howard Univ., 545 A.2d 638, 641 (D.C. 1988) (internal q u o ta tio n marks omitted)). Determining whether an agreement is integrated requires examining " th e intent of the parties at the time they entered into the agreement." Piedmont Resolution, LLC, v . Johnston, Rivlin, & Foley, 999 F. Supp. 34, 50 (D.D.C. 1998) (quoting Good Food, 608 A.2d a t 126-27 (internal quotation omitted)). Although Daisley asserts that he "signed the offer letter with the understanding that his te rm of employment was for a minimum of six years" and that his `enhanced compensation p a c k a ge' "would be honored by Defendant Riggs for the minimum six-year term of employment," C o m p l . ¶ 37, such a statement does not establish his intent at the time of contracting for purposes o f determining whether he has an actionable claim for breach of contract. See Simard v. R e s o lu tio n Trust Corp., 639 A.2d 540, 553 (D.C. 1994) ("[a]n employee's subjective belief that h e r employment is not terminable at will is not controlling . . . ."). Rather, "[t]he first and most im p o rta n t step in ascertaining that intent is examination of the contract itself," for `if [a] d o c u m e n t is facially unambiguous, its language should be relied upon as providing the best o b je c tiv e manifestation of the parties' intent.'" Hercules & Co., Ltd. v. Shama Rest. Corp., 613 A .2 d 916, 927 (D.C. 1992) (quoting 1010 Potomac Assocs. v. Grocery Mfrs. of Am., Inc., 485 A .2 d 199, 205 (D.C. 1984) (other citation omitted)). D a is le y does not identify any relevant ambiguity in the offer letter. Although the offer
letter does not include a formal integration clause,3 it clearly states that it "confirms our oral offer o f employment," Offer Letter at 1, and that "[i]f there is any term of employment that we d i s c u s s e d that is not included in this letter, please contact [Patti Yoder, Riggs' Human Resources D i re c t o r ] immediately so we can include it. If the offer described in this letter is acceptable, p l e a s e sign below . . . ," id. (emphasis added). Daisley's signature appears at the bottom of the p a ge , dated May 7, 1999. "Where the parties reduce an agreement to a writing which in view of its completeness and specificity reasonably appears to be a complete agreement, it is taken to be a n integrated agreement unless it is established by other evidence that the writing did not c o n s titu t e a final expression." RESTATEMENT (SECOND) OF CONTRACTS § 209(3) (1981). Daisley d o e s not allege any such "other evidence" that would undermine a reading of the offer letter as a c o m p le te ly integrated agreement. Next, Daisley argues that even if the offer letter is found to be a fully integrated a g re e m e n t , because "Roane confirmed Defendant Riggs' commitment to [Daisley] to employ him fo r a six-year term," Compl. ¶ 59, such "ratification constituted an oral modification of the offer l e t te r ." 4 Opp'n at 11. The mere oral promise of fixed-term employment, however, "is
A declaration in an agreement itself that the agreement is integrated is not conclusive, although it is certainly evidence of integration. See United States v. Basin Elec. Power Co-op, 248 F.3d 781, 809 (8th Cir. 2003). Rather, the central inquiry remains "the intent of the parties at the time they entered the agreement." Masurovsky, 687 A.2d at 202. Bank defendants correctly point out that "modification of a contract normally occurs when the parties agree to alter a contractual provision or to include additional obligations, while leaving intact the overall nature and obligations of the original agreement." Hildreth Consulting Eng'rs, P.C. v. Knight, Inc., 801 A.2d 967, 974 (D.C. 2002). The offer letter itself states that "[a]ny modifications to this Agreement must be made in writing and signed by both parties." Offer Letter at 3. It is well-settled in the District of Columbia, though, that "a written contract may be modified or rescinded by a subsequent oral agreement, even where the contract contains express language prohibiting oral modification." Puma v. Sullivan, 746 A.2d 871, 875 (D.C. 2000) (citing Nickel v. Scott, 59 A.2d 206, 207 (D.C. 1948)). This doctrine, however, does not salvage Daisley's breach of contract claim regarding his termination, because allegations of a "mere promise" of fixed-term or permanent employment are insufficient to rebut the presumption of at-will employment. See Willoughby v. Potomac Elec. Power Co., 100 F.3d 999, 1001 (D.C. Cir. 1996); see also Fleming v. AT&T Info. Servs., Inc., 878 F.2d 1472, 1474-75 (D.C. Cir. 1989) (affirming district court's dismissal of breach of contract claim where plaintiff sought recovery based upon defendant employer's alleged assurances of long-term or lifetime employment). 9
insufficient to rebut the presumption of at will employment." Willoughby v. Potomac Elec. P o w e r Co., 100 F.3d 999, 1001 (D.C. Cir. 1996) (citing Minihan v. Am. Pharm. Ass'n, 812 F.2d 7 2 6 , 728 (D.C. Cir. 1987); Jankins v. TDC Mgmt. Corp., 21 F.3d 436, 443 (D.C. Cir. 1994); C h o a t e , 14 F.3d at 77). Rather, a plaintiff bears the burden of alleging facts sufficient to show th a t "the parties intended that termination be subject to specific preconditions." Wilson v. P r u d e n tia l Fin., 332 F. Supp. 2d 83, 91, n.4 (D.D.C. 2004) (citing Strass v. Kaiser Found. Health P l a n of Mid-Atl., 744 A.2d 1000, 1011 (D.C. 2000); see also Lance, 355 F. Supp. 2d at 361). Because Daisley has not plead facts that would show that both parties intended to alter the p re s u m p tio n of at-will employment, he has no remedy in contract law for his termination. Wilson, 332 F. Supp. 2d at 92. The court, therefore, grants bank defendants' motion to dismiss D a is le y's breach of contract claim as it applies to his termination from Riggs. D a is le y, however, also asserts a breach of contract claim over his `enhanced c o m p e n s a tio n package,' alleging that notwithstanding his at-will status, he should still "receive th e bonus amounts he was entitled to but never received as part of his enhanced compensation p a c k a ge for the period he was employed by Defendant Riggs, May 1999 through August 2001." Opp'n at 11, n.1. Bank defendants make no response to this argument. The offer letter Daisley signed on May 7, 1999 provides terms for his compensation. Specifically, the offer letter establishes a starting annual salary of $200,000, which will "be re v ie w e d periodically, usually on an annual basis, to determine whether an adjustment should be m a d e . " Offer Letter at 1. Additionally, the offer letter instructs Daisley that he "may be eligible fo r up to 100% of [his] base salary for exceeding agreed upon performance goals" specified in the le tte r, id. at 1-2; and provides that "we will recommend to the Board of Directors a Stock Option G ra n t of 25,000 options." Id. at 2. Daisley, however, alleges that Hoffman and Lex promised th a t he would be compensated on significantly different terms, Compl. ¶¶ 27-28, 50, and that
Roane, though initially "unaware" of Daisley's `enhanced compensation,' subsequently " c o n firm e d Defendant Riggs' commitment" to provide Daisley such compensation. Id. ¶¶ 58-59. S p e c ific a lly, Daisley contends he in addition to his salary, during his employment with Riggs he w a s entitled to an annual bonus of up to 100% of his base salary "if defined performance o b je c tiv e s were met"; "annual salary increases of up to 10%" of the base salary; and an initial a l l o c a t i o n of 25,000 stock options with a subsequent annual allocation of 10,000 stock options "if d e fin e d performance objectives were met." Id. ¶ 28. While Daisley states that he received a $ 2 0 0 ,0 0 0 bonus shortly after his one-year anniversary with Riggs, id. ¶61, he asserts that he was im p ro p e rly denied his bonus upon his two-year anniversary, id. ¶ 167; never received the $ 2 0 ,0 0 0 pay raise due him for his second year of employment with Riggs, id. ¶ 165; and did not re c e iv e the annual grant of 10,000 stock options, id. ¶¶ 166, 168, despite his successful c o m p le tio n of the agreed-upon performance objectives. Id. ¶¶ 165, 167. Notwithstanding an at-will employment agreement, an employee and employer may still c o n tra c t regarding other terms, such as bonuses or stock options. See Terrell v. Uniscribe P r o fe s s io n a l Servs., Inc., 348 F. Supp. 2d 890, 893 n.3 (N.D. Ohio 2004) ("At-will employees m a y enter into binding subsidiary contracts with their employers."). Courts have found that an e m p l o ye e ' s at-will status does not prevent him from recovering for compensation owed to him fo r work performed during his period of employment. See Smith v. Chase Group, Inc., 354 F.3d 8 0 1 , 807 (8th Cir. 2004) (citation omitted) (finding an oral contract for compensation between an e m p lo ye r and an at-will employee "sufficiently definite and certain" to create an obligation on b e h a l f of the employer); Livernois v. Med. Disposables, Inc., 837 F.2d 1018, 1023 (11th Cir. 1 9 8 8 ) (citation omitted) ("an at-will employee may sue for any compensation that is due him u n d er an oral contract, based on services actually performed by him up to the time of d is c h a rge ." ). To the extent that Daisley pleads that he "received no compensation whatsoever for ye a rs four (except $33,898), five, and six because of his wrongful and premature termination," C o m p l . ¶ 170, he fails to state a claim for which relief can be granted. His remaining breach of
contract claims regarding enhanced compensation, based upon Riggs' alleged modification of the o ffe r letter, survive bank defendants' present motion. 2 . Promissory Estoppel U n d e r District of Columbia law, to establish a promissory estoppel claim, the plaintiff m u s t show (1) a promise; (2) that the promise reasonably induced reliance on it; and (3) that the p ro m is e e relied on the promise to her detriment. Simard, 639 A.2d at 552 (citing Choate,14 F.3d a t 77). Promissory estoppel, however, is not available in all circumstances; District of Columbia l a w "presupposes that an express, enforceable contract is absent when the doctrine of promissory e s to p p e l is applied." Bldg. Servs. Co. v. Nat'l R.R. Passenger Corp., 305 F. Supp. 2d 85, (D.D.C. 2 0 0 4 ) (citing Int'l Bus. Mach. Corp. v. Medlantic Healthcare Group, 708 F. Supp. 417, 424 (D .D .C . 1989) (noting that "courts have held that an integrated written contract controls as a ga in s t any and all prior inconsistent oral agreements or promises; such a contract nullifies the e ffe c t that promissory estoppel might otherwise have.")). This principle enjoys near-universal acceptance in American jurisdictions. See, e.g., Carlson v. Arnot-Ogden Mem'l Hosp., 918 F.2d 411, 416 (3d Cir. 1990); Jhaver v. Zapata OffS h o r e Co., 903 F.2d 381, 385, n.11 (5th Cir. 1990); APJ Assocs., Inc. v. N. Am. Philips Corp., 3 1 7 F.3d 610, 617 (6th Cir. 2003); All-Tech Telecom, Inc. v. Amway Corp., 174 F.3d 862, 869 (7 th Cir. 1999) ("when there is an express contract governing the relationship out of which the p ro m is e emerged, and no issue of consideration, there is no gap in the remedial system for p ro m is s o ry estoppel to fill."). In other words, "[p]romissory estoppel is not a legal doctrine d e s ign e d to give a party to a negotiated commercial bargain a second bite at the apple in the event it fails to prove breach of contract." Walker v. KFC Corp., 728 F.2d 1215, 1220 (9th Cir. 1984). Because "a party may not assert a promissory estoppel claim where there is an enforceable c o n tra c t," Bynum v. Equitable Mortg. Group, 2005 WL 818619 at *16 (D.D.C. Apr. 7, 2005), the
court dismisses Daisley's promissory estoppel claim.5 3 . Intentional Interference with Employment Relationship T o state a claim for intentional interference with an employment relationship in the D i s tric t of Columbia, the plaintiff must show (1) the existence of an employment contract; (2) d e fe n d an t's knowledge of the contract; (3) defendant's intentional procurement of the breach of th e contract; and (4) damages. Sorrells v. Garfinckel's, 565 A.2d 285, 289 (D.C. 1989). Here, Daisley asserts a claim against Roane for "malicious and intentional interference w i th [Daisley's] employment relationship with Defendant Riggs," Compl. ¶ 143, which led to D a is le y's termination. Daisley alleges that his enhanced compensation package triggered the je a lo u s y of Roane, id. ¶ 130, who "then set out to make [Daisley] the scapegoat for all problems re la tin g to CA$HLINK II," id. ¶ 132. More specifically, Roane allegedly acquiesced to T r e a s u ry's change orders and cost overruns, while simultaneously pressuring Daisley to take a m o r e confrontational position, so that Treasury "would eventually come to perceive [Daisley] as D e fe n d a n t Riggs' offensive and obnoxious point man and seek [his] removal from the C A $ H LIN K II project altogether." Id. ¶ 133. Additionally, Daisley claims that "Roane advanced th e date of the `FMS Summit' and secured [Daisley's] `forced separation' while [Daisley] was a w a y on vacation with his family." Id. ¶ 140. Bank defendants argue that Daisley cannot recover on this claim because "under an atw i ll arrangement the prerequisite does not exist for the tort of interference with employment re la tio n s h i p ." Dale v. Thomason, 962 F. Supp. 181, 184 (D.D.C. 1997). Dale based its holding o n a D.C. Court of Appeals case decided the previous year, Bible Way Church of Our Lord Jesus C h r i s t of the Apostolic Faith of Wash. v. Beards, 680 A.2d 419 (D.C. 1996). In that case, the
Furthermore, reliance on a promise cannot be reasonable when it is completely at odds with the terms of a written agreement covering the same transaction. See In re U.S. Office Prods. Co. Sec. Litig., 251 F. Supp. 2d 77, 97-98 (D.D.C. 2003) (reliance on oral statements unreasonable when such statements contradicted terms of, and were not incorporated into, the written agreement). 13
court determined that because the plaintiff was employed at-will, she had "no basis for either a b re a c h of contract or tortious interference with contract claim" against her employer. Id. at 433. A subsequent D.C. Court of Appeals case confirmed this conclusion, finding it "clear" th a t as an at-will employee, the plaintiff "did not have a contractual employment relationship she c o u ld use as the basis for a suit for tortuous [sic] interference with a contractual relationship" a gain s t her former employer and managers. McManus v. MCI Communications Corp., 748 A.2d 9 4 9 , 957 (D.C. 2000). McManus also extended the reasoning of Bible Way to the tort of in t e rfe re n c e with prospective employment relations, finding that "this court has never held that an e m p l o ye e can maintain a suit for interference with prospective advantage where her expectancy w a s based on an at-will relationship, and we do not do so now." Id. McManus went on to note th a t even if the plaintiff did have a cognizable claim for interference with a prospective e m p l o ym e n t relationship, she could not prevail against her supervisor because "the law affords to a supervisor . . . a qualified privilege to act properly and justifiably toward a fellow employee and th a t employee's true employers those who have the power to hire and fire." Id. at 958 (quoting S o r r e l ls , 565 A.2d at 291). Bible Way and McManus foreclose the possibility that Daisley, as an a t-w ill employee, can recover from his former employer or former supervisor for intentional in te rfe re n c e with employment relations, either on the basis of existing contract or prospective a d v a n t a ge .6
Dale interpreted Bible Way to hold that "[a] third party who interferes with such a tenuous relationship [at-will employment] is not liable to the employee since no wrongful breach of contract can result from his interference." 962 F. Supp. at 184. Dale, however, overstates the scope of Bible Way, which only blocked an employee's suit against her employer. While McManus went further, barring an intentional interference suit against the employee's supervisors, and denying a claim based on prospective as well as current contractual relations, this court notes that the question of whether an at-will employee may recover against a third party unrelated to the employer has not been clearly resolved by courts in this jurisdiction. The Supreme Court has indicated that "third-party interference with at-will employment relationships" has "long been a compensable injury under tort law." Haddle v. Garrison, 525 U.S. 121, 126 (1998) (citing THOMAS COOLEY, 2 LAW OF TORTS 589-591 (3d ed. 1906); Truax v. Raich, 239 U.S.33, 38 (1915) ("The fact that the employment is at the will of the parties, respectively, does not make it one at the will of others . . . the unjustified interference of third persons is actionable although the employment is at will."); W. KEETON ET AL., PROSSER AND 14
4. Civil Conspiracy a . against Roane T h e tort of civil conspiracy has four elements: "(1) an agreement between two or more p e r s o n s ; (2) to participate in an unlawful act, or in a lawful act in an unlawful manner; and (3) an in ju ry caused by an unlawful overt act performed by one of the parties to the agreement (4) p u rs u a n t to, and in furtherance of, the common scheme." Griva v. Davison, 637 A.2d 830, 848 (D .C . 1994) (citing Halberstam v. Welch, 705 F.2d 472, 477 (D.C. Cir. 1983)). However, " [t]h e re is no recognized independent tort action for civil conspiracy in the District of Columbia." Waldon v. Covington, 415 A.2d 1070, 1074 (D.C. 1980) (citing Lamont v. Haig, 590 F.2d 1124, 1 1 3 6 n.73 (D.C. Cir. 1978)). Rather, recovery under a theory of civil conspiracy "is a means for e s ta b l is h i n g vicarious liability" for "some underlying tortious act." Weishapl v. Sowers, 771 A .2 d 1014, 1023-24 (D.C. 2001) (quoting Griva, 637 A.2d at 848). Performance of the u n d e rlyin g tort, pursuant to an agreement, gives rise to a civil conspiracy claim. Halberstam, 705 F .2 d at 479; see also Riggs v. Home Builders Inst., 203 F. Supp. 2d 1, 25-26 (D.D.C. 2002) (p la in tiff stated a claim for civil conspiracy under District of Columbia law when he pled a c o g n i z a b l e underlying tort). Because the court dismisses Daisley's intentional interference with e m p l o ym e n t claim, there is no longer an "underlying tortious act" to support his claim of civil c o n s p i ra c y against Roane. b . against McGuire A s for Daisley's civil conspiracy claim against McGuire, the court concludes that it does n o t have jurisdiction to consider such a claim. Even assuming arguendo that Daisley could e s t a b l is h that he was not an at-will employee, allowing his intentional interference with e m p l o ym e n t relations claim to survive dismissal, he could not use an interference with
KEETON ON LAW OF TORTS § 129, pp. 995-96, n.83 (5th ed. 1984)); see also Worrell v. Henry, 219 F.3d 1197, 1214 n.4 (10th Cir. 2000) ("an at-will employee who has no wrongful termination action against his employer may still be able to assert an intentional interference claim against a third party."). 15
employment claim as the basis for the civil conspiracy claim against McGuire. This is because th e court determines that since McGuire was acting in the scope of his employment at the time of th e alleged conspiracy, the proper defendant is the United States, not McGuire; and because u n d e r the Federal Tort Claims Act ("FTCA") the United States has not waived its sovereign im m u n ity for "[a]ny claim arising out of ... interference with contract rights." 28 U.S.C. § 2 6 8 0 (h ). i. "acting within the scope of employment" T h e Federal Employees Liability Reform and Tort Compensation Act ("Westfall Act"), 28 U .S .C . § 2679(b)(1), provides that a federal employee acting within the scope of employment is im m u n e from state tort suits for money damages.7 See Stokes v. Cross, 327 F.3d 1210, 1213 ( D .C . Cir. 2003); Haddon v. United States, 68 F.3d 1420, 1423 (D.C. Cir. 1995). A plaintiff's o n ly recourse is to proceed under FTCA against the United States, Haddon, 68 F.3d at 1423, w h i c h is substituted as a party defendant upon certification by the Attorney General that a federal e m p l o ye e was acting within the scope of employment at the time of the alleged claim.8 This c e rtifica tio n , however, is not conclusive. Stokes, 327 F.3d at 1213 (citing Gutierrez de Martinez v . Lamagno, 515 U.S. 417, 434 (1995). Instead, the district court may determine independently w h e t h e r the employee was acting within the scope of employment and, therefore, whether s u b s titu tio n is proper. Stokes, 327 F.3d at 1213-14; Haddon, 68 F.3d at 1423. Here, the Chief of
28 U.S.C. § 2679(b)(1) provides that "[t]he remedy against the United States provided by sections 1346(b) and 2672 of this title for injury or loss of property, or personal injury or death arising or resulting from the negligent or wrongful act or omission of any employee of the Government while acting within the scope of his office or employment is exclusive of any other civil action or proceeding for money damages by reason of the same subject matter against the employee whose act or omission gave rise to the claim or against the estate of such employee." 28 U.S.C. § 2679(d)(1) provides that "[u]pon certification by the Attorney General that the defendant employee was acting within the scope of his office or employment at the time of the incident out of which the claim arose, any civil action or proceeding commenced upon such claim in a United States district court shall be deemed an action against the United States under the provisions of this title and all references thereto, and the United States shall be substituted as the party defendant." 16
the Civil Division of the United States Attorney's Office for the District of Columbia has c e rtifie d that McGuire was acting within the scope of his employment with the Treasury during th e incidents alleged in Daisley's complaint. Fed. Defs.' Mot. to Dismiss at 5 n.2; Certification o f Mark Nagle. D a is le y has requested discovery and an evidentiary hearing regarding McGuire's scope of e m p lo ym e n t. Opp'n (Fed. Defs.') at 5-6. In order to obtain discovery and an evidentiary hearing, h o w e v e r, he must "raise a material dispute regarding the substance" of the certification by " a lle gin g facts that, if true, would establish that the defendant [was] acting outside the scope of [h i s ] employment." Stokes, 327 F.3d at 1215. The district court does not err in dismissing a c l a i m against an employee prior to discovery where the plaintiff "did not allege any facts in his c o m p l a in t or in any subsequent filing ... that, if true, would demonstrate that [the defendant] had b e e n acting outside the scope of his employment." Id. at 1216 (citing Singleton v. United States, 2 7 7 F.3d 864, 871 (6th Cir. 2002)); see also Caesar v. United States, 258 F. Supp. 2d 1, 4 (D .D .C . 2003) ("If the Court may independently determine, taking all of the allegations of the C o m p l a in t as true, and making all reasonable factual inferences in the plaintiff's favor, that, as a m a tte r of law, the alleged tortfeasor was acting within the scope of her employment when p la in tiff was injured, then no evidentiary hearing is required."). Daisley's complaint does not contain sufficient factual allegations to warrant discovery on th e scope of employment question. State law governs the scope of employment determination. See, e.g., Stokes, 327 F.3d at 1215. Here, the court must apply District of Columbia law, which is b a s e d on the Restatement (Second) of Agency. See id.; Haddon, 68 F.3d at 1423. Under D.C. l a w , conduct of a servant is within the scope of employment if (1) "it is of the kind he is e m p l o ye d to perform"; (2) "it occurs substantially within the authorized time and space limits"; ( 3 ) "it is actuated, at least in part, by a purpose to serve the master"; and (4) "if force is in te n tio n a lly used by the servant against another, the use of force is not unexpected by the
Hechinger Co. v. Johnson, 761 A.2d 15, 24 (D.C. 2000) (quoting RESTATEMENT
( S E CO N D) OF AGENCY §228 (1957)). Applying this standard, and assuming the truth of Daisley's fa c tu a l allegations, the court concludes that McGuire was acting within the scope of employment w h e n he allegedly conspired to have Daisley terminated from Riggs. First, Daisley's own allegations indicate that McGuire's conduct was of the kind he was e m p lo ye d to perform. To satisfy this first prong of the Restatement, McGuire's actions must be " o f the same general nature as that authorized" or "incidental to the conduct authorized." See H a d d o n , 68 F.3d. at 1424 (quoting RESTATEMENT (SECOND) OF AGENCY §229 (1957)). According to the D.C. Court of Appeals, an employee's conduct is "incidental" to his authorized d u tie s if it is "foreseeable," meaning it was "a direct outgrowth of the employee's instructions or jo b assignment." Id. (quoting Boykin v. District of Columbia, 484 A.2d 560, 562 (D.C. 1984)). Under District of Columbia law, the alleged tort does not have to be explicitly sanctioned b y the employer for the employee's conduct to be of the kind he was employed to perform. R a th e r , the conduct need only have directly arisen from the employee's authorized duties, such as a dispute involving a work assignment. See Lyon v. Carey, 533 F.2d 649, 652-53 (D.C. Cir. 1 9 7 6 ) ; Weinberg v. Johnson, 518 A.2d 985, 990-92 (D.C. 1986) (Johnson II); Johnson v. W e in b e r g (Johnson I), 434 A.2d 404, 408-09 (D.C. 1981). H e re , the complaint indicates that the animosity between Daisley and McGuire arose d ire c tly from the tense working relationship between their respective employers. Through D a i s l e y' s persistence, Treasury was forced to bear an additional $14,000,000 in costs. Compl ¶ 1 0 9 . As a result of his efforts on behalf of Riggs, Daisley alleges that "[d]efendant McGuire and o t h e r personnel at Defendant Treasury gratuitously and consistently challenged Plaintiff . . . ," id. ¶ 115 (emphasis added).10 Additionally, Daisley avers that Treasury requested his removal from
The Restatement's fourth prong, involving the use of force by the employee, is clearly inapplicable to Daisley's complaint. 10 Daisley makes similar allegations elsewhere. See Compl. ¶ 71 (Roane was "consistently outmaneuvered by Defendant Treasury personnel" and that Roane's approach "established a 18
the CA$HLINK project prior to McGuire's alleged conduct involving the FMS Summit. Id. ¶ 1 2 2 . As described by Daisley, McGuire's hostility was shared by others at Treasury, and e m e rge d from their work-related conflicts with Daisley.11 Accordingly, the first part of the scopeo f-e m p lo ym e n t test is satisfied. Second, McGuire's alleged conduct occurred "substantially within the authorized time a n d space limits." See RESTATEMENT (SECOND) OF AGENCY §228 (1957). This prong of the R e s t a t e m e n t 's scope-of-employment test is satisfied when the alleged tort was committed while th e employee was working. See Konarski v. Brown, 293 F. Supp. 2d 70, 73 (D.D.C. 2003); C a e s a r , 258 F. Supp. 2d at 5. In this case, McGuire's alleged conspiracy to have Daisley te rm i n a te d was planned in the course of work-related communications, and was executed at the F M S Summit, a business meeting attended by officials from Treasury and Riggs bank. Accordingly, his alleged actions fall within the RESTATEMENT's time and space requirement. Third, Daisley's allegations indicate that McGuire was motivated at least in part by a d e s ire to serve Treasury. See RESTATEMENT (SECOND) OF AGENCY §228 (1957). Daisley's a s s e r t io n s that McGuire wanted him removed because of McGuire's alleged concern with his
precedent at Defendant Treasury to `work around' Plaintiff to achieve Defendant Treasury's aims"); id. ¶ 109 ("representatives from Defendant Treasury consistently sought to by-pass [Daisley] and deal directly with Roane because [Roane] ... constantly capitulated to Defendant Treasury's demands"); id. ¶ 122 (Roane ultimately achieved his goal of "convincing representatives at Defendant Treasury that Plaintiff had to go"); id. ¶ 134 (Daisley "resisted numerous efforts by representatives of Defendant Treasury to saddle Defendant Riggs with inflated costs" that Treasury had failed to budget); id. ¶ 203 ("representatives from Defendant Treasury, including Defendant McGuire and Mr. Carfine, did not understand some basic principles of the CA$HLINK II arrangement and, in order to cover up their own missteps, requested that Defendant Riggs absorb specific Build costs that Defendant Treasury was clearly responsible for") (emphases added). Accordingly, this case is distinguishable from Haddon, which Daisley cites in support of a determination that McGuire was acting outside the scope of employment. 68 F.3d at 1425-26. In that case, the court concluded that the defendant's conduct was "completely unrelated to his official responsibilities" because the threat stemmed from a dispute (an EEOC complaint involving the plaintiff and another employee) that did not concern his employment. Id. at 1425. Here, in contrast, McGuire's alleged acts stem from his work for the Treasury on CA$HLINK II and by Daisley's admission directly relate to the financial disputes he had with Daisley involving this project. 19
own incompetence and job security, see Compl. ¶¶ 112, 115, 147, do not establish that McGuire w a s acting outside of the scope of his employment. District of Columbia scope-of-employment l a w is "broad enough to embrace any intentional tort arising out of a dispute that `was originally u n d e r ta k e n on the employer's behalf.'" Stokes, 327 F.3d at 1216 (quoting Johnson II, 518 A.2d a t 992 (citations omitted)). Thus, while the District of Columbia excludes from the scope of e m p lo ym e n t "all actions committed solely for the servant's own purposes," an employer is liable fo r the employee's intentional tort, if the tort is committed "partially because of a personal m o tiv e [of the employee], such as revenge, as long as the employee is actuated, at least in part, b y a desire to serve his principal's interests." Johnson II, 518 A.2d at 988, 990 (internal q u o ta tio n marks, alterations, and citations omitted) (emphases added). Daisley maintains that Treasury wanted to avoid additional CA$HLINK II costs and that T re a s u ry employees regularly tried to limit their contact with him in order to achieve this aim. Compl. ¶¶ 71, 109, 134. Thus, McGuire's alleged attempt to have Daisley removed from C A $ H LIN K II closely relates to his employer's business and objectives. In addition, Daisley in d ic a te s that, whatever personal enmity McGuire allegedly had towards him, McGuire also a d v o ca te d Treasury's interest. According to Daisley, McGuire contested Daisley's efforts to have T re a s u ry pay for the CA$HLINK II change requests, telling him that "other banks work for T re a s u ry for free" and that he (McGuire) "did not understand why Riggs Bank would not do the s a m e . " Compl. ¶ 113. Since McGuire's allegedly tortious conduct was connected to a dispute i n v o l v i n g his employer's business, and in accord with his employer's interest, the court c o n c lu d e s that his alleged actions were undertaken at least in part to serve Treasury. Thus, under District of Columbia law, McGuire's conduct, as described by Daisley, was w ith i n the scope of his employment with the Treasury. Accordingly, discovery and an e v i d e n tia ry hearing on the scope of employment issue are unwarranted, and the United States' c e rtific a tio n must be given effect. McGuire must be dismissed from the case and the United S ta te s substituted as defendant for McGuire on the civil conspiracy claim. See, e.g., Koch, 209 F.
Supp. 2d at 93 (substituting the United States as defendant and dismissing the federal employee a ft e r concluding, as a matter of law that the employee was acting within the scope of his e m p l o ym e n t ); Hosey v. Jacobik, 966 F. Supp. 12, 15 (D.D.C. 1997). Since the court has d e t e rm in e d that the civil conspiracy claim must be brought against the United States under F T C A , it must next consider whether the United States has waived its sovereign immunity for s u its of this nature. ii. no liability absent waiver of sovereign immunity T h e United States is immune from tort liability absent an express waiver of sovereign im m u n ity. See United States v. Sherwood, 312 U.S. 584, 586 (1941). This waiver must define th e terms of the United States' consent and establish the court's jurisdiction to entertain the suit. See id. Under FTCA, the United States may be held liable "for injury or loss of property, or p e r s o n a l injury or death" caused by a government employee "where . . . a private person, would b e liable to the claimant in accordance with the law of the place where the act or omission o c c u r re d " under similar circumstances. 28 U.S.C. § 1346(b); see also 28 U.S.C. § 2674 ( p r o v i d i n g that the United States will be liable for tort claims "to the same extent as a private p e r s o n under like circumstances"); Art Metal-U.S.A., Inc. v. United States, 753 F.2d 1151, 11575 8 (D.C. Cir. 1985). FTCA's waiver of sovereign immunity is also subject to a number of e x c e p tio n s . See 28 U.S.C. § 2680. If an exception applies, sovereign immunity is not waived a n d the court lacks subject matter jurisdiction over the case. See Sloan v. United States Dep't of H o u s in g and Urban Dev., 236 F.3d 756, 759 (D.C. Cir. 2001). iii. no waiver of sovereign immunity for interference with contract rights T h e FTCA provides that the United States' sovereign immunity is not waived as to "any c la im arising out of . . . interference with contract rights." 28 U.S.C. § 2680(h). This jurisdiction h a s interpreted this exception the FTCA's waiver of sovereign immunity to encompass claims for in te rfe re n c e with employment. See United States Info. Agency v. Krc, 989 F.2d 1211, 1216 (D.C. C ir. 1993) (claim for intentional interference with prospective employment opportunities arises
out of interference with contract rights and therefore is barred by sovereign immunity under F T C A ) ; Vanover v. Hantman, 77 F. Supp. 2d 91, 98-99 (D.D.C. 1999) (claim for intentional i n t e r fe r e n c e with employment arises out of interference with contract rights and therefore is b a r r e d by sovereign immunity under FTCA); Art-Metal U.S.A., 753 F.2d at 1154-55 (finding that a claim for interference with prospective economic advantage arises from interference with c o n tra c t rights because it involves interference in an economic relationship between two parties, a n d noting that interference with contracts in existence or subject to future creation falls within th e exception). Daisley's civil conspiracy claim against McGuire therefore rests upon an u n d e rlyin g tort for which the United States has not waived its sovereign immunity. See 28 U.S.C. § 2680(h). This court must therefore dismiss the civil conspiracy claim against McGuire for lack o f subject matter jurisdiction. 5. Fraud A t common law, the requisite elements of fraud are: (1) "a false representation (2) made in reference to a material fact, (3) with knowledge of its falsity, (4) with the intent to deceive, and (5 ) an action that is taken in reliance upon the representation," and "at least in cases involving c o m m e rc ia l contracts negotiated at arm's length there is the further requirement (6) that the d e fra u d e d party's reliance be reasonable." Hercules, 613 A.2d at 923 (internal citations o m itte d ). Under Fed. R. Civ. P. 9(b), "the circumstances constituting fraud or mistake shall be p l e a d with particularity. Malice, intent, knowledge, and other condition of mind of a person may b e averred generally." The circumstances of the fraud that generally must be plead with s p e c i fi c i ty are "the time, place, and content" of the misrepresentations, "the misrepresented fact, a n d what the opponent retained or the claimant lost as a consequence of the alleged fraud." United States ex rel. Fisher v. Network Software Assocs., 227 F.R.D. 4, 9 (D.D.C. 2005) (citing U n ite d States ex rel. Totten v. Bombardier Corp., 286 F.3d 542, 551-52 (D.C. Cir. 2002) (other c ita tio n omitted)). "The concealment of a fact that should have been disclosed" may also
constitute fraud, Sage v. Broadcasting Publ'ns, Inc., 997 F. Supp. 49, 52 (D.D.C. 1997) (citing F e ltm a n v. Sarbov, 366 A.2d 137, 140-41 (D.C. 1976)), "especially where there is a duty to d i s c lo s e ." Pyne v. Jamaica Nutrition Holdings Ltd., 497 A.2d 118, 131 (D.C. 1985) (internal c i t a t io n s omitted); Bennett v. Kiggins, 377 A.2d 57, 59 (D.C. 1977), cert. denied, 434 U.S. 1034 (1 9 7 8 ) (non-disclosure or silence may constitute fraud). The springboard for Daisley's fraud claim is his allegation that in April 2000 Roane " i n i ti a t e d discussions with [Daisley] about an alleged `promotion'" from Senior Vice President to E x e c u t iv e Vice President. Compl. ¶ 172. According to Daisley, Roane presented this change in p o s i t io n as a promotion, knowing that the change "was in realty a demotion . . . in that it m a te ria lly and adversely impacted the terms of [Daisley's] enhanced compensation package." Id. ¶ 174. Daisley further states that Roane misrepresented the alleged `promotion'. . . by his failure t o disclose to [Daisley] that as an Executive Vice President, [Daisley] would not be entitled to his e n h a n c e d compensation package as a matter of internal policy at Defendant Riggs." Id. ¶ 176. Roane allegedly "revealed this deception" ten months after the purported promotion. Id. ¶ 178. Bank defendants first contend that Daisley has failed to plead fraud with the requisite p a rtic u la rity. Bank Defs.' Mot. to Dismiss at 16-17. The court disagrees. Fed. R. Civ. P. 8, w h i c h requires only "a short and plain statement of the claim showing that the pleader is entitled to relief," should be read "in conjunction" with Rule 9(b). Kowal, 16 F.3d at 1278. Rule 9(b)'s re q u ire m e n t s ensure that defendants have notice of a fraud claim sufficient to provide a m e a n in gfu l response. See Network Software Assocs., 227 F.R.D. at 9. However, when a plaintiff " d e s c r ib e [ s ] the nature of the alleged misrepresentations, the general time frame in which they w e re made, and the parties involved," as Daisley does here, his failure to "specify the exact time a n d particular place of each misrepresentation or omission" will not mandate dismissal of his c la im . Towers Fin. Corp. v. Solomon, 126 F.R.D. 531, 535 (N.D. Ill. 1989). Daisley's complaint i n c l u d e s the subject matter of the alleged misrepresentation, identifies which defendant allegedly m a d e the misrepresentation, and attributes the misrepresentation to a particular period of time.
He has thus provided sufficient information, as contemplated by Rule 9(b), to give defendants " a d e q u a te notice of the specifics" of Daisley's fraud claim. Shekoyan v. Sibley Int'l Corp., 217 F. S u p p . 2d 59, 74 (D.D.C. 2002). Second, bank defendants argue that Daisley has "failed to allege any duty to speak" on the p a r t of Roane. Bank Defs.' Mot. to Dismiss at 17. Bank defendants cite Brown v. Dorsey & W h itn e y , LLP for the proposition that "[a]n employer/employee relationship is not a fiduciary re la tio n s h ip upon which a fraudulent concealment action can spring." 267 F. Supp. 2d 61, 80 (D .D .C . 2003) (quoting Hooters of Am., Inc. v. Phillips, 39 F. Supp. 2d 582, 607 (D.S.C. 1998)). In Dorsey & Whitney, however, the plaintiff argued that the defendant employer had an a ffi rm a t i v e obligation to make sure that the plaintiff read and understood the employer's dispute re s o l u t io n policy. Here, in contrast, Daisley instead alleges that Roane deliberately "made a false re p re s e n ta tio n when he conferred a `promotion'" on Daisley. Pl.'s Opp'n (Bank Defs.) at 12. Furthermore, because "the existence of a fiduciary relationship is a fact-intensive question, in v o lv in g a searching inquiry into the nature of the relationship, the promises made . . . and the le gitim a te expectations of the parties," Firestone v. Firestone, 76 F.3d 1205, 1211 (D.C. Cir. 1 9 9 6 ) (citation omitted), Daisley's fraud claim is not amenable to dismissal at this time. 6. Negligent Hiring/Supervision a . against Riggs T h e torts of negligent hiring and supervision are actionable in the District of Columbia. See Tarpeh-Doe v. United States, 28 F.3d 120, 123 (D.C. Cir. 1994); Phelan v. City of Mt. R a in i e r , 805 A.2d 930, 937 (D.C. 2002). As with any negligence action, the plaintiff must show t h a t in its hiring or supervision, the defendant breached an applicable duty of care, causing injury to the plaintiff. See id. at 938 (citations omitted). In addition, to establish a cause of action for n eglige n t supervision, a plaintiff must show: (1) that the employer "knew or should have known its employee behaved in a dangerous or otherwise incompetent manner," and (2) that the e m p lo ye r, "armed with that actual or constructive knowledge, failed to adequately supervise the
employee." Giles v. Shell Oil Corp., 487 A.2d 610, 613 (D.C. 1985) (emphasis omitted); see also R y c z e k v. Guest Servs., Inc., 877 F. Supp. 754, 764 (D.D.C. 1995) (granting summary judgment fo r defendant in absence of evidence to "suggest that [defendant] knew or should have known a b o u t any improper activity or that [defendants'] negligence caused damages to the plaintiff.") H e r e , Daisley contends that Riggs "had a duty and obligation to provide [him] with q u a l i fi e d professionals" to assist him, Compl. ¶ 193, and that placing him under Roane's s u p e rv i s io n "constituted a breach of [this] duty," id. ¶ 196, since Roane "lacked the requisite k n o w le d g e and experience to supervise [Daisley]." Id. In response, bank defendants argue that th i s claim must be dismissed because "[t]he District of Columbia, like many states, requires that th e alleged injury in a negligent supervision or hiring case be a physical injury." Bank Defs.' M o t. to Dismiss at 19. Despite a thorough review of caselaw, the court has not located any s u p p o rt for this sweeping proposition. In some jurisdictions, physical injury is a clearly established requirement for recovery u n d e r a negligent hiring or negligent supervision theory. See Monte v. Ernst & Young LLP, 330 F . Supp. 2d 350, 365 (S.D.N.Y. 2004) ("negligent hiring/retention claims are usually sustained o n l y where a plaintiff has suffered significant physical injury."); St. Hilaire v. Minco Prods., Inc., 2 8 8 F. Supp. 2d 999, 1010 (D. Minn. 2003) ("to maintain an action for either negligent retention o r negligent supervision, the existence of a threat, or reasonable apprehension of actual physical i n j u r y is required.") (citations and internal quotation marks omitted); Parker v. Geneva Enters., In c . , 997 F. Supp. 706, 713 (E.D. Va. 1997) (interpreting an element requiring that the hiring in v o lv e an "unreasonable risk of harm to others" as requiring "the threat of serious and s i g n i fi c a n t physical injury."). In contrast, courts in other jurisdictions have explicitly stated that an allegation of p h ys ic a l injury is not required for a negligent hiring or supervision claim. See Kiesau v. Bantz, 6 8 6 N.W. 2d 164, 172 (Iowa 2004) (finding "no requirement that an injured party must sustain p h ys ic a l injury to recover under a claim of negligent hiring, supervision, or retention" and
directly overruling a prior case that held otherwise); Grego v. Meijer, Inc., 187 F. Supp. 2d 689, 6 9 4 (W.D. Ky. 2001) ("the tort of negligent supervision does not necessarily derive from e m p l o ye e s ' torts that cause physical injury"); Verhelst v. Michael D's Rest. San Antonio, Inc., 1 5 4 F. Supp. 2d 959, 968 (W.D. Tex. 2001) ("a cause of action for negligent supervision and t ra i n i n g requires that the employee in question commit an actionable tort, causing a `legally c o m p e n s a b l e injury' not necessarily a physical injury."); Van Horne v. Muller, 691 N.E. 2d 74, 8 0 (Ill. App. Ct.), rev'd in part on other grounds by 705 N.E. 2d 898 (Ill. 1998) ("just because p h ys ic a l injury has been alleged in previous cases does not mean that such an allegation is a p re re q u is ite to stating a cause of action" under negligent hiring). Additional courts have implicitly recognized that a valid claim for negligent supervision m a y be predicated upon tortious acts that do not necessarily result in physical injury. See Hays v. P a tto n -T u lly Transp. Co., 844 F. Supp. 1221, 1223 (W.D. Tenn. 1993) ("a negligent supervision c la im will lie in a sexual harassment case if supported by a viable claim of tortious conduct," s u c h as "battery or intentional infliction of emotional distress"); Mendes v. Jednak, 92 F. Supp. 2 d 58, 63 (D. Conn. 2000) (an employer may be liable for negligent hiring if the employer knew o r should have known that the harm the plaintiff suffered "was likely to result from [the e m p lo ye r's ] conduct"). In the District of Columbia, no court has spoken directly to this issue.12 In the absence of c o n c lu s iv e authority, the court will not graft a physical injury requirement onto the tort of
Bank defendants cite to Morgan v. Psychiatric Inst. of Wash., 692 A.2d 417, 423 (D.C. 1997), to support their claim that physical injury is a prerequisite for recovery under a negligent hiring or supervision theory. In that case, the D.C. Court of Appeals overturned the trial court's grant of summary judgment to the defendants on several of the plaintiff's claims, including negligent hiring or supervision and negligent infliction of emotional distress, because the plaintiff's alleged injuries, "if proven, satisfied the legal requirement for physical injury in a claim for negligent infliction of emotional distress." Id. The Morgan court's apparent borrowing, without analysis, of the physical injury requirement from the tort of negligent infliction of emotional distress hardly demonstrates that the District of Columbia "requires that the alleged injury in a negligent supervision or hiring claim be a physical injury." Bank Defs.' Mot. to Dismiss at 19. 26
negligent hiring or supervision. Daisley's negligent hiring and supervision claim, however, must n o n eth e le s s be dismissed. This is because the only underlying tort Daisley identifies, and the o n ly injury he alleges for purposes of this claim, is his termination: "[h]ad Defendant Riggs b ro u gh t in talented and competent individuals to collaborate with [Daisley] on CA$HLINK II, [D a is le y] would still be employed at Defendant Riggs." Compl. ¶ 198. Daisley has not defeated t h e presumption that his employment with Riggs was at-will. Because "no cause of action will lie for wrongful discharge of an employee subject to termination at will," Buttell v. Am. Podiatric M e d . Ass'n, 700 F. Supp. 592, 600 (D.D.C. 1988), Daisley has not identified a legally cognizable to rt resulting from Riggs' alleged negligence in failing to provide him with "talented and c o m p e t e n t individuals" as supervisors or colleagues. Compl. ¶ 198. Consequently, his claim a gain s t Riggs for negligent supervision and hiring is dismissed. b. against Treasury D a is le y also brings a negligent hiring and supervision claim against Treasury. Because th e department "owed [Daisley] a duty to staff the project with i
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