Solid Concepts, LLC v. Fallen Soldiers, Inc. et al
Filing
92
MEMORANDUM OPINION. Signed by Chief Judge Deborah K. Chasanow on 4/12/11. (sat, Chambers)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
:
SOLID CONCEPTS, LLC
:
v.
:
Civil Action No. DKC 09-2377
:
FALLEN SOLDIERS, INC., et al.
:
MEMORANDUM OPINION
Presently pending and ready for review is the motion of
Defendant Gaylord National, LLC to dismiss the claim alleged
against it in Plaintiff’s second amended complaint (ECF No. 80).
The issues have been fully briefed and the court now rules, no
hearing deemed necessary.
Local Rule 105.6.
For the reasons
that follow, Defendant’s motion will be denied.
I.
Background
This case arises from investments made by Plaintiff Solid
Concepts,
LLC,
in
relation
to
“The
African
&
International
Friends Inaugural Ball” (“Ball”) that was to be held on January
20, 2009, to commemorate the inauguration of President Barack
Obama.
operates
Defendant Gaylord National, LLC (“Gaylord”) owns and
the
Gaylord
National
where the Ball was to be held.
Resort
and
Convention
Center
At the direction and insistence
of the organizers of the Ball, Defendants Fallen Soldiers, Inc.,
the Alliance for Business Strategy, Inc., Karen Bryant Coachman,
and Walter Fauntroy, on or about December 26, 2008, Plaintiff
entered into the Inaugural Ball Gaylord National Hotel Block
Contract (the “contract”) with Gaylord to reserve a block of 576
rooms at the Convention Center for January 20 and 21, 2009.
Plaintiff paid a non-refundable deposit of $1,155,875.44, one
hundred percent of the full amount, to reserve the rooms, with
the understanding that Fallen Soldiers, Inc., The Alliance for
Business
Strategy,
Inc.,
Karen
Bryant
Coachman,
and
Walter
Fauntroy would resell the rooms as part of sponsorship packages
for
the
Ball
and
repay
Plaintiff
double
its
investment.
Ultimately the entirety of Plaintiff’s block of rooms was not
reserved by guests of the Ball, and Plaintiff alleges that a
portion
of
its
reserved
rooms
were
sold
to
other
guests
by
Gaylord National.
Plaintiff
filed
a
ten
count
complaint
on
May
8,
2009,
including claims of breach of contract and unjust enrichment
against Defendant Gaylord National.
(ECF No. 1).
filed an amended complaint on October 16, 2009.
Plaintiff
(ECF No. 48).
Gaylord National and Defendant Isaac Gibson filed a motion to
dismiss
that
was
granted
without
prejudice,
subsequently filed its second amended complaint.
51,
74,
and
75).
Count
V
of
the
second
and
Plaintiff
(ECF Nos. 50,
amended
complaint
alleges that Gaylord is liable for breach of the Inaugural Ball
2
Hotel Block Contract (ECF No. 75 ¶¶ 59-66).
now moves to dismiss count V.
II.
Defendant Gaylord
(ECF No. 80).
Motion to Dismiss
A.
Standard of Review
The purpose of a motion to dismiss pursuant to Fed.R.Civ.P.
12(b)(6)
is
to
test
the
sufficiency
of
the
plaintiff’s
complaint.
See Edwards v. City of Goldsboro, 178 F.3d 231, 243
(4th
1999).
Cir.
Except
in
certain
specified
cases,
a
plaintiff’s complaint need only satisfy the “simplified pleading
standard” of Rule 8(a), Swierkiewicz v. Sorema N.A., 534 U.S.
506, 513 (2002), which requires a “short and plain statement of
the
claim
showing
Fed.R.Civ.P.
requires
a
that
the
8(a)(2).
is
Nevertheless,
‘showing,’
rather
entitlement to relief.”
544, 555 n.3 (2007).
pleader
than
a
entitled
“Rule
to
relief.”
8(a)(2)
blanket
still
assertion,
of
Bell Atl. Corp. v. Twombly, 550 U.S.
That showing must consist of more than “a
formulaic recitation of the elements of a cause of action” or
“naked
assertion[s]
Ashcroft
v.
Iqbal,
devoid
of
further
129
S.Ct.
1937,
factual
1949
enhancement.”
(2009)(internal
citations omitted).
In its determination, the court must consider all well-pled
allegations in a complaint as true, Albright v. Oliver, 510 U.S.
266, 268 (1994), and must construe all factual allegations in
3
the light most favorable to the plaintiff.
See Harrison v.
Westinghouse Savannah River Co., 176 F.3d 776, 783 (4th Cir.
1999)(citing Mylan Labs., Inc. v. Matkari, 7 F.3d 1130, 1134
(4th Cir.
1993)).
The
court
need
not,
however,
accept
unsupported legal allegations, Revene v. Charles County Comm’rs,
882 F.2d 870, 873 (4th Cir. 1989), legal conclusions couched as
factual allegations, Iqbal, 129 S.Ct. at 1950, or conclusory
factual allegations devoid of any reference to actual events,
United Black Firefighters v. Hirst, 604 F.2d 844, 847 (4th Cir.
1979).
See
also
(4th Cir. 2009).
Francis
v.
Giacomelli,
588
F.3d
186,
193
“[W]here the well-pleaded facts do not permit
the court to infer more than the mere possibility of misconduct,
the complaint has alleged, but it has not ‘show[n] . . . that
the pleader is entitled to relief.’”
(quoting Fed.R.Civ.P. 8(a)(2)).
Iqbal, 129 S.Ct. at 1950
Thus, “[d]etermining whether a
complaint states a plausible claim for relief will . . . be a
context-specific task that requires the reviewing court to draw
on its judicial experience and common sense.”
B.
Id.
Analysis
Gaylord argues that count V of the second amended complaint
should be dismissed because Plaintiff has failed to state a
valid cause of action for breach of contract.
that
Plaintiff
did
not
contract
4
to
Gaylord contends
reserve
specific,
identifiable pre-assigned rooms, but rather that the contract
specified that Gaylord would make rooms available to any of
Plaintiff’s
guests
upon
their
arrival
at
the
hotel.
Consequently, because none of Plaintiff’s guests showed up to
the hotel and were denied rooms, Gaylord never breached the
contract.
(ECF No. 80-1, at 1-2).
maintains
that
the
contract
necessary,
condition
precedent
In other words, Gaylord
contained
to
the
an
implicit,
hotel’s
but
obligation
to
furnish an actual room for occupancy—namely that a guest had to
present himself at the hotel with a reservation and demand to
occupy a room.
(ECF No. 80-1, at 7).
In support Gaylord cites
to hotel breach of contract cases from other jurisdictions where
plaintiffs
with
reservations
attempted
to
check
in
and
turned away or transferred to hotels of lesser quality.
were
(Id.
at 7-9)(citing Wells v. Holiday Inns, Inc., 522 F.Supp. 1023
(W.D.Mo.
1981),
(1972)(overruled
Dold
on
v.
Outrigger
Hotel,
other
grounds),
Rainbow
54
Haw.
Travel
18,
23
Serv.
v.
Hilton Hotels, 896 F.2d 1233 (10th Cir. 1990), Odysseys Unlimited
v. Astral Travel Serv., 77 Misc.2d 502, 505 (N.Y.Sup.Ct. 1975),
and Marriot Corp. v. Am. Acad. of Psychotherapists, Inc., 157
Ga.App. 497 (1981)).
Gaylord argues that because Plaintiff does
not allege that any guests completed this condition precedent,
5
Gaylord’s duty to perform was not triggered and Plaintiff cannot
claim that a breach of the contract occurred.
Plaintiff
repeating
its
argues
“no
in
harm
response
no
foul”
that
(Id.).
Gaylord
argument
that
is
simply
this
court
previously rejected and arguing that it had a right to double
revenue for the same rooms.
(ECF No. 86, at 2).
Plaintiff also
contends that Gaylord’s argument that the contract contained an
implied
condition
precedent
is
not
an
appropriate
basis
for
granting the motion to dismiss now, but rather is a defense that
Gaylord may pursue as the case progress.
(Id. at 4-5).
Finally
Plaintiff contends that Gaylord should be judicially estopped
from arguing that the contract between the parties should fail
for
indefiniteness
because
in
its
prior
motion
to
dismiss
Gaylord argued that the Plaintiff’s claim for unjust enrichment
should
be
dismissed
because
parties’ express contract.
dispositive
issue
is
the
the
claim
(Id. at 5).
question
of
was
governed
by
the
Ultimately the key
whether
the
contract
included a condition precedent.
Under Maryland law, to state a claim for breach of contract
a plaintiff must plead the existence of a contractual obligation
owed by the defendant to the plaintiff and a material breach of
that obligation.
RRC Ne., LLC v. BAA Md., Inc., 413 Md. 638,
6
658 (2010).1
Where a contractual duty is subject to a condition
precedent, there is no duty of performance until the condition
precedent has occurred or been performed.
Chirichella v. Erwin,
270 Md. 178, 181 (1973)(citing Griffith v. Scheungrab, 219 Md.
27, 34-35 (1958)).
In Chirichella, the Court of Appeals of
Maryland noted that “[a] condition precedent has been defined as
‘a fact, other than mere lapse of time, which, unless excused,
must exist or occur before a duty of immediate performance of a
promise arises.”
(Id. at 182)(quoting 17 Am.Jur.2d. Contracts,
§ 320);
13
see
2010)(“A
also
condition
Williston
precedent
on
is
a
Contracts
fact
or
§
(4th
ed.
which
the
38:1
event
parties intend must exist or take place before there is a right
to performance.”).
condition
1
the
“Whether a provision in a contract is a
nonfulfillment
of
which
excuses
performance
When ruling on state law claims, a United States District
Court sitting in Maryland applies Maryland’s choice of law rule.
McCoubrey v. Kellog, Krebs & Moran, 7 F.App’x. 215, 219 (4th Cir.
2001)(citing Klaxon Co. v. Stentor Electric Mfg. Co., 313 U.S.
487 (1941)).
“Maryland applies the law of the jurisdiction
where the contract was made to matters regarding the validity
and interpretation of contract provisions, and a contract is
made where the last act necessary to make the contract binding
occurs.@
Riesett v. W.B. Doner & Co., 293 F.3d 164, 173 n.5
th
The contract
(4 Cir. 2002)(internal citations omitted).
between Plaintiff and Gaylord indicated that it would become
final after Gaylord counter-signed. (ECF No. 75, Ex. C, at 3).
Although not explicit from the face of the document, the court
will presume for the time being that Gaylord signed the
agreement in Maryland where it is it located, and will apply
Maryland law.
7
depends upon the intent of the parties, to be ascertained from a
fair and reasonable construction of the language used in the
light of all the surrounding circumstances when they executed
the contract.”
13 Williston on Contracts § 38:1; Chirichella,
270 Md. at 182.
Practical convenience and necessity have led
courts to include within the term “express conditions” not only
those manifested by words, but also those necessarily inherent
in the actual performance of the contract, which are sometimes
termed “conditions implied in fact” or “implied conditions.”
Williston on Contracts § 38:11.
favored
in
law
and
courts
13
Conditions precedent are not
should
not
construe
such
unless
required to do so by plain, unambiguous language or by necessary
implication.
Hubler Rentals, Inc. v. Roadway Exp., Inc., 637
F.2d 257 n.2 (4th Cir. 1981).
Here, Plaintiff has alleged that it was party to a contract
with Gaylord, (ECF No. 75 ¶¶ 70 and 60), and it attached a copy
of that contract as an exhibit to the complaint.
The
contract
required
that
Plaintiff
pay
(Id. Ex. C).
$1,155,872.44
in
exchange for Gaylord reserving a block of rooms for the nights
of January 20 and 21, 2009.
Plaintiff paid 100% of the full
cost of the room reservations up front.
The contract contains
no language indicating that Plaintiff would forfeit its right to
the rooms if its guests failed to show up by a certain time, and
8
Plaintiff alleges that Gaylord was contractually obligated to
give Plaintiff the exclusive right to use and/or possess the
rooms.
(Id.
¶
28).
Plaintiff
contends
that
Gaylord’s
re-
booking of the rooms in Plaintiff’s block and Gaylord’s failure
to then reimburse Plaintiff for the amount it had paid for the
room’s
exclusive
Gaylord’s
use
obligation
exclusive use.
and
to
possession
maintain
constitutes
the
rooms
a
for
breach
of
Plaintiff’s
(Id. ¶ 62).
The language of the parties’ contract does not on its face
contradict Plaintiff’s interpretation.
expressly
including
Gaylord’s memorandum.
the
condition
There is no provision
precedent
as
set
forth
in
Moreover, the contract’s language states:
“The following guest rooms have been reserved” and then includes
a table with the specific number of each type of room that was
included in Plaintiff’s block.
(Id. Ex. C, at 1).
In addition,
the contract specified that 100% of the cost had to be paid by
Plaintiff up-front and was non-refundable.
(Id. Ex. C, at 2-3).
The only reference to Gaylord releasing rooms from the block
appears in the section labeled “Confirmation” where it states
that Plaintiff had to submit a signed copy of the agreement with
full
payment
by
Thursday,
December
11,
2008
at
5:00
p.m.,
otherwise Gaylord reserved the right to release the rooms from
the block at 5:01 p.m. EST on that date.
9
(Id. Ex. C, at 3).
There is no allegation that Plaintiff failed to submit a signed
copy and full payment by the required date, and, thus, on its
face
the
contract
provides
no
authorization
release any rooms from the block.
not
contradict
complaint,
the
and
allegations
Plaintiff
has
for
Gaylord
to
Thus the contract itself does
in
Plaintiff’s
stated
a
claim
second
for
amended
breach
of
contract.
The cases referenced by Gaylord in its motion to dismiss do
not
alter
this
decision.
The
fact
that
courts
have
found
breaches of contract where guests with reservations showed up
and were denied rooms does not lead inexorably to Gaylord’s
conclusion that in any case with a different fact pattern there
can be no breach of contract.
Each contract is unique and a
party’s obligations will differ according to the terms of the
governing
seconded
because
contract.
amended
it
fails
Likewise,
complaint
to
Gaylord’s
lacks
identify
the
the
argument
requisite
specific
room
that
the
specificity
numbers
or
locations of the rooms that Gaylord was obligated to reserve is
unconvincing.
The implication in Plaintiff’s complaint is that
the Gaylord failed to reserve the requisite number of rooms for
Plaintiff’s use.
Accepting this allegation as true, Plaintiff
has stated a claim against Gaylord.
10
III. Conclusion
For
the
foregoing
reasons,
Defendant
LLC’s motion to dismiss will be denied.
Gaylord
National,
A separate Order will
follow.
/s/
DEBORAH K. CHASANOW
United States District Judge
11
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