Overholt v. Landcar Management, Ltd. et al
Filing
79
MEMORANDUM OPINION. Signed by Judge Deborah K. Chasanow on 8/3/2015. (sat, Chambers)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
:
DUANE M. OVERHOLT
:
v.
:
Civil Action No. DKC 13-3097
:
LANDCAR MANAGEMENT, LTD, et al.
:
MEMORANDUM OPINION
Presently pending and ready for resolution in this breach
of
contract
case
is
a
motion
for
summary
judgment
filed
by
Defendants Landcar Management, Ltd., the Entities Comprising the
Larry H. Miller Group of Automotive Companies trading as the
Larry Miller Auto Group, Auto Village Motors, Inc., Larry H.
Miller Corporation – Englewood, and Larry H. Miller Corporation
– Colorado, Inc. (collectively, “Defendants”).
(ECF No. 62).
The issues have been fully briefed, and the court now rules, no
hearing being deemed necessary.
Local Rule 105.6.
For the
following reasons, Defendants’ motion for summary judgment will
be granted.
I.
Background
A.
Factual Background
Unless otherwise noted, the following facts are undisputed.
Duane
M.
Overholt
(“Mr.
Overholt”
or
“Plaintiff”)
is
a
“consultant to auto dealers[hips] as well as to consumers and to
former employees.”
(ECF No. 62-6, at 3, Overholt depo.).
Larry
H. Miller Group owns fifty-six (56) automobile dealerships which
collectively
Group.
operate
under
the
(ECF No. 55 ¶¶ 2-4).
trade
name
Larry
Miller
Auto
Defendants are headquartered in
Sandy, Utah and are managed by Landcar Management, Ltd.
Plaintiff is self-employed and also controls and operates
Stop Auto Fraud, “an organization [or website] that basically
helps consumers and former employees acquire access to the legal
profession.”
screenshot).
(Id.
at
3-4;
see
also
ECF
No.
62-7,
Plaintiff explains his trade as follows:
A: When this first started, consumers -- we
were assisting consumers to understand what
happened to them. We weren’t trying to give
them a legal basis or to assist them to find
legal remedies to their claims.
It was to
understand what they did.
Once they
understood that, then they understood that
they could possibly recover, okay?
And at
that point we would help them acquire
information, tell them how they can get
their documents and their records and how
they can ask for those and how they could
have an outside source look at their cars,
such as a body shop or an entity that would
give them evaluations.
At that point, once they had those
documents
and
records
that
they
had
themselves, they could take them to an
attorney and then have that attorney help
them; but we found that most attorneys did
not understand the auto industry at all. So
we found ourselves in a position where we
started having to help attorneys understand
the paper trail, the document trail; and
once they were able to do that, they were
able to make a legal conclusion. So it was
actually assisting them to make a decision
2
website
and assisting the consumer to get the right
documents and records.
(ECF No. 62-6, at 6-7).
In
early
2007,
Plaintiff
was
contacted
by
numerous
consumers and employees regarding Larry Miller Auto Group.
No.
62-6,
at
14-15).
Sometime
in
2007,
Plaintiff
(ECF
received
correspondence from Bryant Henrie, operations manager for the
Larry Miller Group of companies with oversight over Defendants’
dealership operations in multiple states, asking “if we [would]
open
up
a
organization.”
Larry
H.
dialogue
to
better
(Id. at 18).
Miller
Management
assist
the
ECF
No.
62-6,
at
Miller
On March 17, 2007, Plaintiff and
Company
entered
Agreement (“the 2007 Consulting Agreement”).
also
Larry
20).
The
2007
into
a
Retainer
(ECF No. 62-4; see
Consulting
Agreement
provides, in relevant part:
has
requested
[Mr.
[T]he
Party[1]
Overholt] to assist in the development of
materials for the actual or potential use in
selling, financing vehicles for sale AND
ASSIST IN A SET OF GUIDELINES THAT WILL HELP
Party
comply
with
federal
and
state
compliance laws, specific in nature; the
truth and lending statutes in the state of
Utah; and [Mr. Overholt] has agreed to so[.]
(ECF No. 73-3, at 2).
The 2007 Consulting Agreement states that
it “will begin when signed and dated, and will end when service
1
Throughout the 2007 Consulting Agreement, Larry H. Miller
Management Company is referred to as “Party.” (ECF NO. 25-1, at
1).
3
is provided to the Party.”
(Id. at 3).
More facts regarding
the 2007 Consulting Agreement will be included in the analysis
section.
On June 10, 2008, Plaintiff was contacted by Beth Busick
(“Ms. Busick”) by telephone regarding her grievances against one
of
Larry
Miller’s
dealerships
where
she
was
employed.
Busick subsequently followed up with an email.
Ms.
(ECF No. 73-7,
at 2 (“I would like your help pertaining to my situation that I
explained to you in our telephone conversation this morning.”)).
At the time, Ms. Busick was employed as the Dealership Finance
Director by Larry H. Miller Nissan in Colorado.
(Id.).
Mr.
Overholt flew out to Denver, Colorado to meet with Ms. Busick.
(ECF No. 73-8).
Mr. Overholt testified during his deposition
that during their meeting, she provided him with “documents that
she
had
taken
from
the
Larry
Miller
Nissan
dealership
Denver,” purportedly showing wrongdoing at the dealership.
No. 62-6, at 34, Overholt depo.).
some
point
after
his
(ECF
Mr. Overholt believed that
some of the documents were falsified by Ms. Busick.
At
in
meeting
with
(Id.).
Ms.
Busick,
Mr.
Overholt met with Pat Kroneberger, the Senior Vice President
with
responsibility
for
managing
the
district
that
includes
Nissan of Denver, and Tom Mayrose, the dealership manager who at
the time was responsible for day-to-day operations of Nissan of
Denver, to discuss the Beth Busick documents.
4
On June 20, 2008,
Mr. Overholt accompanied Ms. Busick to the Nissan dealership,
where she was presented with a termination agreement.
No. 62-15, at 18).
Initially, Ms. Busick was dissatisfied with
the terms of the agreement.
that
she
wanted
(See ECF
$30,000
Mr. Overholt informed Larry Miller
in
severance
pay.
(Id.
at
20).
Ultimately, Ms. Busick executed a termination agreement and was
paid $30,000 in severance.
believed
that
Mr.
(ECF No. 62-14, at 6-7).
Overholt
“negotiated”
the
behalf, although Plaintiff disputes this point.
Ms. Busick
$30,000
on
her
(Id.).
On January 29, 2010, Mr. Overholt and Defendants signed a
second consulting agreement (“2010 Consulting Agreement”).
No. 73-15).
(ECF
The contract was entered into between Mr. Overholt
and Robert Tingey, an attorney representing Landcar Management,
Ltd. and each of the entities comprising the Larry H. Miller
Group of Automotive Companies.
The 2010 Consulting Agreement
states that “[i]t is understood and agreed that attorney is
acting as a direct agent of the Larry Miller Auto Group” (id. at
2),
and
“specifically
agrees
to
be
a[n]
agent
of
the
Larry
Miller Auto Group liable for payment of all monies due and owing
to [Mr. Overholt] under this Agreement” (id. at 3).
It further
provides that it is an extension of previous agreements between
Mr. Overholt and Larry Miller Auto Group.
Agreement
provides,
inter
alia,
that
The 2010 Consulting
Mr.
Overholt
is
“a
specialized service provider [who] restricts his activities to
5
providing attorneys with support services specific to automotive
consumer fraud issues.
Services include but are not limited to
the review, preparation and presentation of legal documentation,
facts, figures, and opinions; expert trial testimony; deposition
preparation
and
preparation.”
assistance;
(Id.
at
and
2).
assistance
The
2010
with
affidavit
Consulting
Agreement
further states:
Unless otherwise agreed to in this
agreement, the Attorney [Mr. Tingey] agrees
to pay [Mr. Overholt] a non-refundable fee
equal to $3000.00 to keep all parties under
contract for a 5 year period. It is clearly
understood that this AGREEMENT IS FOR THE
PURPOSE AND TIME RELATED TO, REVIEW AND
DEFENSE OF ANY AND ALL LEGAL ACTS SUBMITTED
AGAINST THE LARRY MILLER Auto Group.
(Id. at 3) (emphasis in original).
In April 2010, Ms. Busick complained to the Colorado Office
of
Attorney
Regulation
Counsel
(“OARC”),
alleging
that
Mr.
Overholt had represented her as her “attorney” during the 2008
meeting with the Nissan dealership, negotiated on her behalf,
and gave her legal advice.
ECF No. 62-26).
On
(ECF No. 62-14, at 10); (see also
OARC subsequently conducted an investigation.
December
15,
2010,
the
OARC
filed
a
Petition
for
Injunction against Mr. Overholt, requesting that he be enjoined
from the unauthorized practice of law (hereinafter, “the UPL
Proceeding”).
(ECF No. 62-34).
On April 16 through 18, 2013,
the Supreme Court of Colorado held a hearing on the UPL charges
6
through its Presiding Disciplinary Judge (“PDJ”).
On June 11,
2013, the PDJ issued his Report of Hearing Master Pursuant to
C.R.C.P. 236(a) recommending that the Supreme Court of Colorado
find
that
Mr.
Overholt
practice of law.
did
not
engage
(ECF No. 62-35)
in
the
unauthorized
On July 12, 2013, having
reviewed the PDJ’s written opinion, the Colorado Supreme Court
issued the following order:
IT IS ORDERED that the Colorado Supreme
Court finds the Respondent, DUANE OVERHOLT,
D/B/A STOP AUTO FRAUD did not engage in the
unauthorized practice of law.
IT IS FURTHER ORDERED that the Colorado
Supreme Court waives any fines, restitution
or costs associated with this case.
(ECF No. 62-36).
On October 3, 2013, Defendants gave Plaintiff notice that
they
were
cancelling
Agreements.
both
the
2007
and
2010
Consulting
(ECF No. 73-12).
B. Procedural Background
Plaintiff
filed
a
complaint
in
Montgomery County on April 15, 2013.
the
Circuit
Court
for
Defendants removed the
action to this court on October 18, 2013.
(ECF Nos. 1 & 2).
Plaintiff
December
alleging
filed
the
an
amended
following
complaint
causes
of
7
on
action:
breach
of
9,
2013,
contract
(counts I and V);2 breach of the implied covenant of good faith
and fair dealing (count II); wrongful involvement in litigation
(count III); defamation (count IV); and malicious use of process
(count VI).
(ECF No. 25).
After the parties completed discovery, Defendants moved for
summary judgment on October 3, 2014.
(ECF No. 62).
Plaintiff
opposed the motion (ECF No. 73), and Defendants replied (ECF No.
76).
II.
Standard of Review
A motion for summary judgment will be granted only if there
exists no genuine dispute as to any material fact and the moving
party
is
entitled
to
judgment
as
a
matter
of
law.
See
Fed.R.Civ.P. 56(a); Celotex Corp. v. Catrett, 477 U.S. 317, 322
(1986);
Anderson
(1986).
v.
Liberty
Lobby,
Inc.,
477
U.S.
242,
250
Once a properly supported motion for summary judgment
is filed, the nonmoving party is required to make a sufficient
showing on an essential element of that party’s claim as to
which that party would have the burden of proof to avoid summary
judgment.
Celotex, 477 U.S. at 322–23.
2
Although Plaintiff labels count V of his amended complaint
as a “breach of contract” claim, the allegation in that count
states that Defendants owed Plaintiff a duty of good faith and
fair dealing, which they breached by “turning around and lying
to OARC to lead it to believe Overholt had been working not for
them but for Busick.” (ECF No. 25 ¶ 58).
8
Summary judgment is appropriate under Federal Rule of Civil
Procedure Rule 56(a) when there is no genuine dispute as to any
material
fact,
and
the
moving
party
is
plainly
judgment in its favor as a matter of law.
In
entitled
to
Anderson v.
Liberty Lobby, Inc., 477 U.S. at 249 (1986), the Supreme Court
explained that, in considering a motion for summary judgment,
the “judge’s function is not himself to weigh the evidence and
determine the truth of the matter but to determine whether there
is a genuine issue for trial.”
A dispute about a material fact
is genuine “if the evidence is such that a reasonable jury could
return a verdict for the nonmoving party.”
Id. at 248.
Thus,
“the judge must ask himself not whether he thinks the evidence
unmistakably favors one side or the other but whether a fairminded jury could return a verdict for the [nonmoving party] on
the evidence presented.”
Id. at 252.
In undertaking this inquiry, a court must view the facts
and the reasonable inferences drawn therefrom “in the light most
favorable to the party opposing the motion.”
Matsushita Elec.
Indus. Co. Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986)
(quoting
United
States
v.
Diebold,
Inc.,
369
U.S.
654,
655
(1962)); see also EEOC v. Navy Fed. Credit Union, 424 F.3d 397,
405 (4th Cir. 2005).
evidence
in
support
The mere existence of a “scintilla” of
of
the
non-moving
9
party’s
case
is
not
sufficient to preclude an order granting summary judgment.
See
Anderson, 477 U.S. at 252.
A “party cannot create a genuine dispute of material fact
through mere speculation or compilation of inferences.”
Shin v.
Shalala, 166 F.Supp.2d 373, 375 (D.Md. 2001) (citation omitted).
Indeed,
this
court
has
an
affirmative
obligation
to
prevent
factually unsupported claims and defenses from going to trial.
See
Drewitt
v.
Pratt,
999
F.2d
774,
778–79
(4th
Cir.
1993)
(quoting Felty v. Graves–Humphreys Co., 818 F.2d 1126, 1128 (4th
Cir. 1987)).
III. Analysis
Defendants moved for summary judgment on all the counts in
the amended complaint.
In his opposition to the motion for
summary judgment, Plaintiff states:
Defendants
recently
amended
their
answer and invoked as an affirmative defense
an
absolute
judicial
privilege.
This
privilege
appears
to
bar
tort
claims,
including
defamation,
against
them.
Contrary
to
Defendants’
assertions,
Plaintiff has ample incontrovertible and
admissible evidence of the precisely false
and defamatory statements Plaintiff alleges
Defendants made to the Colorado’s Office of
Attorney
Regulat[ion]
Counsel.
.
.
.
However, the Court need not review them or
consider their admissibility in connection
with the instant motion, as the defamation
claim
itself
appears
barred
by
the
aforementioned newly asserted affirmative
defense.
10
(ECF No. 73, at 1) (emphases added).
absolute
judicial
privilege
bars
Plaintiff concedes that
the
defamation
claim.
Plaintiff does not respond at all to the valid arguments made in
Defendants’ motion for summary judgment regarding his claims for
wrongful involvement in litigation, malicious use of process,
and
breach
dealing.
of
the
For
implied
instance,
covenant
as
of
Defendants
good
faith
argue,
and
there
fair
is
no
independent cause of action for breach of the implied covenant
of good faith and fair dealing in Maryland and, in any event,
Plaintiff has provided no evidence that Defendants prevented him
from performing his obligations under the contract.
See Mount
Vernon Props., LLC v. Branch Banking And Trust Co., 170 Md.App.
457,
471-72
(2006).
Furthermore,
the
bases
for
Defendants’
motion for summary judgment on the remainder claims also are
well taken.
Accordingly, summary judgment will be entered on
these claims.
The
contract.
amended
complaint
asserts
two
counts
for
breach
of
The breach of contract claim in count I cites the
January 2010 Consulting Agreement and states:
43.
Pursuant
to
Overholt’s
consulting
agreement with Defendants, Defendants are
obliged to reimburse him for the expenses
and fees, including attorneys[’] fees, and
to pay him for time he incurs in connection
with
any
matter
under
his
consulting
agreement, which includes matters related to
defense of any claims of illegal acts
11
against the “Larry
See, Exhibit B.
Miller
Auto
Group[.]”
44. Overholt incurred [] nearly Two Hundred
Fifty Thousand Dollars ($250,000.00) in
legal fees and out of pocket expenses in
defending
himself
against
the
Civil
Injunction Proceeding.
. . .
46. Defendants failed to pay Overholt for
his time or for the costs and fees incurred
by Overholt in connection with that civil
proceeding and, by so failing, breached
their agreement with Overholt.
(ECF No. 25 ¶¶ 44-46) (emphasis added).
In short, Plaintiff
seeks
fees
reimbursement
for
the
attorneys’
he
allegedly
incurred in defending himself in the UPL Proceeding as a result
of his dealings with Beth Busick in June 2008.
To establish a claim for breach of contract in Maryland,3 a
plaintiff must prove that a contractual obligation exists and
that
the
defendant
has
breached
that
obligation.
See
Continental Masonry Co. v. Verdel Constr. Co., 279 Md. 476, 480
(1977).
written
Plaintiff does not dispute that there were only two
contracts
between
the
parties
–
the
Agreement and the 2010 Consulting Agreement.
2007
Consulting
Defendants briefly
suggest in their initial motion for summary judgment that the
3
The parties agree that Maryland law applies to the breach
of contract claims. The 2007 Consulting Agreement provides that
Maryland law applies.
(ECF No. 73-3, at 5, § 11).
The 2010
Consulting Agreement does not contain a choice of law provision,
but states that “[t]his Agreement shall be deemed to have been
executed . . . [in] Maryland.” (ECF No. 73-15, at 3, § 8).
12
2007
Consulting
Agreement
had
expired
and
was
not
operative
during the Busick events in June 2008, which culminated in the
UPL Proceeding.
(ECF No. 62-1, at 34).
Plaintiff disagrees,
arguing, without any citation to legal authority, that “[w]hen
the parties executed the 2010 agreement, each contemplated that
it was an extension of previously executed agreements.
This
action would revive any contract that would have ended. . . .
The revival of the 2007 contract would require Defendants to
abide
by
the
Plaintiff’s
2007
and
dealings
(emphasis added).
2010
with
contractual
Busick.”
terms
(ECF
in
No.
regards
73,
at
to
16)
The court need not address the merits of this
argument because, as will be seen, no contractual provision in
either contract required Defendants to indemnify Mr. Overholt in
the UPL Proceeding.
(ECF No. 62-1, at 35-36).
Plaintiff relies on several provisions in the 2007 and 2010
Consulting Agreements to hold Defendants liable for his legal
expenses
in
connection
with
the
UPL
Proceeding.
First,
Plaintiff relies on Section 4 of the 2010 Consulting Agreement
as showing that Defendants are obligated to indemnify him for
the UPL Proceeding:
In no event, shall the liability of
[Mr. Overholt] under this agreement, whether
under a theory of contract or tort exceed
the sum and total of monies paid to it, and
[Mr. Overholt] shall not be liable for any
special,
incidental
or
consequential
damages, whether incurred through the agency
13
of [Mr. Overholt] or any other party, and
whether or not [Mr. Overholt] has knowledge
that such damages might be incurred.
[Mr.
Overholt] shall incur no liability for
delays or losses of documents by contract
service providers, the postal services, or
any other carrier.
(ECF
No.
73-15,
at
3,
§
4)
(emphasis
added).
The
2007
Consulting Agreement contains the same provision in Section 6.
(ECF No. 73-3, at 4, § 6).
This provision limits Mr. Overholt’s
liability under the Agreement to Defendants, absolving him from
liability for any special, incidental, or consequential damages
incurred by Defendants.
Defendants do not attempt to impose
liability against Plaintiff under the 2007 or 2010 Consulting
Agreement under any theory.
initiated
against
unauthorized
Mr.
practice
Instead, separate proceedings were
Overholt
of
by
law
OARC
and
Mr.
for
his
alleged
Overhelt
incurred
attorney’s fees in connection with that third-party claim.
general,
provisions
Marriott
courts
will
to
cover
Corp.
v.
not
read
situations
Chesapeake
limitations
beyond
&
their
Potomac
of
liability
express
Telephone
Maryland, 124 Md.App. 463, 475 (1998).
“In
terms.”
Co.
of
The above provision
simply does not apply to the UPL Proceeding.
The court will not
read an indemnification provision into either contract where, as
here, none exists.
Plaintiff
also
cites
Section
8
of
the
2010
Consulting
Agreement and Section 10 of the 2007 Consulting Agreement as
14
obligating Defendants to indemnify him for the UPL Proceeding.
Section 8 of the 2010 Consulting Agreement states:
The Attorney specifically agrees to be a[n]
agent of the Larry Miller Auto Group liable
for payment of all monies due and owing to
[Mr. Overholt] under this Agreement, and for
all expenses that [Mr. Overholt] may incur
in connection with enforcement of its rights
or any other matter hereunder, including
Attorney’s fees.
(ECF No. 73-15, at 3, § 8) (emphases added).
Similarly, Section
10 of the 2007 Consulting Agreement provides:
The
Party
specifically
agrees
to
be
personally liable for payment of all monies
due and owing to [Mr. Overholt] under this
Agreement.
Each party hereto shall be
liable for all expenses that the other may
incur in connection with enforcement of its
rights
or
any
other
matter
hereunder,
including attorney’s fees.
(ECF No. 73-3, at 4, § 10).
Plaintiff emphasizes the “any other
matter” term and argues that because the “UPL proceeding arose
out of Plaintiff’s fulfillment of his contracted for duties[,] .
. . Plaintiff should be indemnified for enforcing Defendants’
rights under the separate contracts.”
(ECF No. 73, at 20).
This argument is misplaced and ignores the plain language of
these provisions.
Agreement
nor
Neither Section 8 of the 2010 Consulting
Section
10
of
the
2007
Consulting
indemnify Mr. Overholt for third-party lawsuits.
Agreement
Both clauses
impose liability on either Larry H. Miller Management Company
(under the 2007 Consulting Agreement) or Mr. Tingey as agent
15
(under the 2010 Consulting Agreement) for payment of all monies
due to Mr. Overholt for his services.
The provisions further
provide that each party is liable for any expenses incurred by
the other party in enforcing the agreements themselves.
Defendants
argue,
“[these]
provision[s]
would
apply,
As
for
example, if Defendants had not paid Overholt for his actual
services spelled out in agreement, requiring Overholt to bring
suit.
However,
th[ese]
provision[s]
in
no
way
obligate[]
Defendants to indemnify Overholt for the fees he incurred in the
UPL
Proceedings
because
Overholt
was
not
enforcing
the
2010
Consulting Agreement [or the 2007 Consulting Agreement] in the
UPL Proceedings.”
(ECF No. 62-1, at 35).
Plaintiff further argues:
Defendants agreed to limit Plaintiff’s
liability
and
imposed
a
strict
confidentiality agreement on Plaintiff.
In
fulfilling and as a result of his contracted
duties in helping Defendants head off and
end potential legal actions against them,
Plaintiff
was
the
subject
of
costly
Unauthorized Practice of Law Proceedings.
These provisions impose a duty on Defendants
to indemnify Plaintiff.
(ECF No. 73, at 18).
contained
The fact that the consulting agreements
confidentiality
clauses
does
not
give
rise
to
liability for failing to indemnify Plaintiff when nothing in the
contracts required Defendants to do so.
16
Based on the foregoing, Plaintiff has not established any
breach by Defendants of either agreement and judgment will be
entered in favor of Defendants on the breach of contract claims.
IV.
Conclusion
For the foregoing reasons, Defendants’ motion for summary
judgment will be granted.
A separate order will follow.
/s/
DEBORAH K. CHASANOW
United States District Judge
17
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