Johnson, MD v. Robert Shields Interiors, Inc.
Filing
45
MEMORANDUM OPINION re Motion for Sanctions. Signed by Magistrate Judge Theresa Carroll Buchanan on 5/11/16. (klau, ) Modified on 5/11/2016 Copy mailed to defendant.(klau, ).
UNITED STATES DISTRICT COURT
FOR THE EASTERN DISTRICT OF VIRGINIA
Alexandria Division
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)
)
)
v.
)
)
ROBERT SHIELDS INTERIORS, INC., )
Defendant.
)
)
TANYA M. JOHNSON, MD,
Plaintiff,
Civ. No. 1:15cv820
MEMORANDUM OPINION
THIS MATTER came before the Court on defendant’s failure to
retain new counsel and note its appearance within 14 days as
ordered by the Court on November 4, 2015, defendant’s failure to
attend the final pretrial conference on December 17, 2015,
defendant’s failure to appear at the Show Cause hearing on
December 18, 2015, and plaintiff’s Motion for Sanctions. (Dkts.
25, 33-35). Following the hearing on plaintiff’s Motion for
Sanctions, the undersigned Magistrate Judge took the matter
under advisement to issue this Memorandum Opinion. 1
I. PROCEDURAL HISTORY
Plaintiff Tanya M. Johnson filed a Complaint in this action
on June 26, 2015, claiming breach of contract, violation of the
Virginia Consumer Protection Act of 1977 (“VCPA”), Va. Code Ann.
1
Pursuant to 28 U.S.C. § 636(c), Federal Rule of Civil Procedure 73, and the
parties’ Consent to the Exercise of Jurisdiction by a United States
Magistrate Judge (Dkts. 16 and 17), the undersigned Magistrate Judge has
jurisdiction over all proceedings in this case.
1
§§ 59.1-196 et seq., and trespass. (Dkt. 1.) Plaintiff alleges
that defendant Robert Shields Interiors, Inc. did not perform in
accordance with the parties’ September 2014 agreement for
defendant to provide professional interior design, space
planning, and decorating services for plaintiff’s home. (Dkt. 1
at ¶¶ 7-10.) Specifically, plaintiff alleges that defendant did
not meet deadlines, made unauthorized charges, made purchases in
violation of the VCPA, and entered onto plaintiff’s property
without permission. (Dkt. 1 at ¶¶ 10-14.) On August 5, 2015,
defendant filed an Answer to the Complaint and a Counterclaim
seeking outstanding payments allegedly owed to defendant
pursuant to the agreement between the parties. (Dkts. 4 and 5.)
That same day, the Honorable Anthony J. Trenga issued a
Scheduling Order setting the initial pretrial conference for
August 26, 2015 and the final pretrial conference for December
17, 2015. (Dkt. 6.) On August 19, 2015, the parties filed a Rule
26(f) Joint Proposed Discovery Plan, which was adopted by the
Court’s Rule 16(b) Scheduling Order. (Dkts. 8 and 9.) Plaintiff
filed an Answer to defendant’s Counterclaim on August 25, 2015,
and discovery proceeded. (Dkt. 11.) The following day, plaintiff
served defendant with plaintiff’s First Request for Production
of Documents and First Interrogatories. (Dkt. 13.)
Shortly thereafter, in accordance with 28 U.S.C. § 636(c)
and Federal Rule of Civil Procedure 73, the parties filed a
2
Consent to the Exercise of Jurisdiction by a United States
Magistrate Judge. (Dkt. 16.) On September 3, 2015, Judge Trenga
ordered that the case be reassigned to the undersigned
Magistrate Judge to conduct any and all proceedings in the case,
including trial, ordering the entry of final judgment, and all
post-judgment proceedings. (Dkt. 17.)
On November 4, 2015, defendant filed a Consent Motion to
Withdraw Appearance, asking the Court to permit counsel for
defendant to withdraw from representation in the case. (Dkt.
24.) That same day, the Court granted the motion and further
ordered that defendant retain new counsel and note its
appearance within 14 days. (Dkt. 25.)
In accordance with Federal Rules of Civil Procedure 33 and
34, defendant’s responses to plaintiff’s First Request for
Production of Documents and First Interrogatories were due on
September 25, 2015. Thereafter, defendant requested until
October 8, 2015, to respond to the discovery requests, to which
plaintiff consented. (Dkt. 27-1 at 2.) However, without any
excuse or further extension of time granted by plaintiff,
defendant failed to respond. As such, plaintiff filed a Motion
to Compel Discovery on November 13, 2015. (Dkt. 27.) That motion
came before the Court for hearing on December 4, 2015. Defendant
filed no response to the motion and did not appear at the
hearing. (Dkt. 31.) The Court thereafter granted plaintiff’s
3
Motion to Compel. (Dkt. 32.)
At the December 4, 2015 hearing, it further came to the
Court’s attention that defendant had not retained new counsel as
required by the Court’s Order of November 4, 2015. The Court
thus issued a Rule to Show Cause, ordering defendant to appear
on Friday, December 18, 2015 to show cause why it should not be
held in contempt for failure to retain counsel. (Dkt. 33.)
Defendant then did not appear for the final pretrial conference
on December 17, 2015, nor did defendant appear at the Show Cause
hearing the following day. (Dkts. 33-34.)
Pursuant to Local Civil Rule 37(C) and the Court’s December
4, 2015 Order granting plaintiff’s Motion to Compel Discovery,
defendant’s responses to plaintiff’s First Request for
Production of Documents and First Interrogatories were due by
December 15, 2015. Defendant again failed to comply. (Dkt. 35-1
at 4.) Consequently, on December 23, 2015, plaintiff filed a
Motion for Sanctions. (Dkt. 35.) That motion came before the
Court for hearing on January 8, 2016. Defendant filed no
response to the motion and did not appear at the hearing. (Dkt.
37.) The undersigned thus took the matter under advisement.
II. ANALYSIS
A. Default Judgment on Plaintiff’s Complaint
Federal Rule of Civil Procedure 37(b)(2)(A) permits the
Court to order sanctions against a party for failure to obey a
4
discovery order. Such an order may include rendering default
judgment against the disobedient party. Fed. R. Civ. P.
37(b)(2)(A)(vi). Similarly, Rule 16(f)(1) permits the Court—on
motion or on its own—to issue any just order if a party or its
attorney fails to appear at a scheduling or other pretrial
conference or fails to obey a scheduling order or other pretrial
order. See Fed. R. Civ. P. 16(f)(1)(A), (C).
In such a case,
orders permitted by the Court include those authorized by Rule
37(b)(2)(A)(ii)-(vii). See Fed. R. Civ. P. 16(f)(1).
In the instant case, the undersigned finds that defendant
has (1) failed to retain counsel as required by the Court’s
Order of November 4, 2015, (2) failed to appear at the final
pretrial conference on December 17, 2015, (3) failed to appear
at the Show Cause hearing on December 18, 2015 and otherwise
failed to respond to the Court’s Rule to Show Cause, (4) failed
to respond to plaintiff’s First Request for Production of
Documents and First Interrogatories, (5) failed to respond to
plaintiff’s Motion to Compel Discovery and failed to appear at
the hearing on that motion, (6) failed to comply with the
Court’s Order granting plaintiff’s Motion to Compel Discovery,
and (7) failed to respond to plaintiff’s Motion for Sanctions
and failed to appear at the hearing on that motion. (Dkts. 6,
25, 27, 31-35, and 37.)
In light of defendant’s numerous failures to comply with
5
the orders of this Court, default judgment will be entered
against defendant as to plaintiff’s Complaint.
When determining sanctions under Rule 37(b), courts in this
Circuit apply a four-part test: “(1) whether the non-complying
party acted in bad faith, (2) the amount of prejudice that
noncompliance caused the adversary, (3) the need for deterrence
of the particular sort of non-compliance, and (4) whether less
drastic sanctions would have been effective.” Anderson v. Found.
for Advancement, Educ. & Emp’t of Am. Indians, 155 F.3d 500, 504
(4th Cir. 1998) (citing Wilson v. Volkswagen of Am., Inc., 561
F.2d 494, 503-05 (4th Cir. 1977)).
Here, in light of those four factors, default judgment is
the most appropriate sanction. First, defendant has on numerous
occasions failed to appear in court when required, failed to
respond to plaintiff’s discovery requests as required, and
failed to comply with the orders of this Court. Defendant’s
failure to retain new counsel, as ordered by this Court, is
particularly troublesome given that “[i]t has been the law for
the better part of two centuries . . . that a corporation may
appear in the federal courts only through licensed counsel.”
Rowland v. Cal. Men's Colony, 506 U.S. 194, 201-02 (1993). Thus
the undersigned finds that defendant has acted in bad faith.
Second, defendant’s noncompliance has prejudiced plaintiff
by delaying the prosecution of this case and forcing plaintiff
6
to incur the additional expense of filing a Motion to Compel
Discovery and a Motion for Sanctions. Additionally, plaintiff’s
time was wasted by appearing for the final pretrial conference
and the Show Cause hearing, both of which defendant failed to
attend. Furthermore, defendant’s failure to retain new counsel
has left plaintiff unable to contact defendant and unable to
proceed in any manner with this litigation. Thus defendant’s
conduct has clearly prejudiced plaintiff.
Third, there is a clear need for this Court to deter the
sort of noncompliance engaged in by defendant. Defendant has
frequently flouted the authority of this Court by failing to
obey the Court’s express orders to retain new counsel, to appear
at the final pretrial conference, to appear at the Show Cause
hearing, and to respond to plaintiff’s discovery requests.
Defendant has similarly ignored its obligations as a party to
this litigation in failing for months now to respond to
plaintiff’s discovery requests—despite an extension, a Motion to
Compel Discovery, and an Order granting that Motion—as well as
failing to respond to or appear at the hearings for the Motion
to Compel Discovery and the Motion for Sanctions. Therefore,
sanctions are necessary to deter this type of conduct in the
future and to teach defendant that obeying Court orders and
complying with its obligations as a party to a lawsuit are not
optional.
7
Fourth, in light of defendant’s extensive noncompliance in
this case, less drastic sanctions are not likely to be
effective. This Court has twice warned defendant that failure to
comply with the orders of the Court may result in default or
summary judgment being entered against defendant. (Dkts. 32 and
33.) Nonetheless, defendant has taken no action to comply with
these Orders or to otherwise participate in this litigation.
Furthermore, plaintiff’s Motion for Sanctions, which asks for
default judgment against defendant and for an award of
reasonable attorneys’ fees, has similarly elicited no response
from defendant. (Dkts. 35 and 37.) Consequently, the undersigned
concludes that less drastic sanctions would not be effective.
B. Dismissal of Defendant’s Counterclaim
Federal Rule of Civil Procedure 41(b) provides that an
action may be dismissed "[i]f the plaintiff fails to prosecute
or to comply with . . . a court order."
Fed. R. Civ. P. 41(b).
“A district court may dismiss an action for lack of prosecution,
either upon motion by a defendant pursuant to Federal Rule of
Civil Procedure 41(b) or on its own motion."
Hedrick, 545 F.2d 393, 396 (4th Cir. 1976).
McCargo v.
In addition to the
authorization provided by Rule 41(b), a district court retains
an “inherent power” to dismiss for failure to prosecute.
Link
v. Wabash R.R. Co., 370 U.S. 626, 630-31 (1962).
In light of defendant’s numerous failures to comply with
8
the orders of this Court, as detailed above, defendant’s
Counterclaim will be dismissed with prejudice.
In this Circuit, four factors must be examined to determine
whether the harsh sanction of dismissal with prejudice is
required.
Chandler Leasing Corp. v. Lopez, 669 F.2d 919, 920
(4th Cir. 1982).
The Court must consider (1) the degree of
personal responsibility of the plaintiff, (2) the amount of
prejudice caused the defendant, (3) the existence of a drawn out
history of deliberately proceeding in a dilatory fashion, and
(4) the existence of a sanction less drastic than dismissal.
Id. 2
Here, the responsibility for these failures rests with
defendant Robert Shields Interiors, Inc. Per the Court’s
November 4, 2015 Order, defendant was responsible for retaining
new counsel within 14 days. Because defendant did not comply
with that Order, the responsibility to appear at the final
pretrial conference, the responsibility to appear at the Show
Cause hearing and respond to the Rule to Show Cause, and the
responsibility to respond to plaintiff Tanya M. Johnson’s
discovery requests following the Court’s Order granting the
Motion to Compel Discovery all rested with defendant. Therefore,
although the initial failure to timely respond to plaintiff’s
2
The Court notes that, in considering these factors as to defendant’s
Counterclaim, defendant Robert Shields Interiors, Inc. as counter-claimant
assumes the role of plaintiff and plaintiff Tanya M. Johnson as counterdefendant assumes the role of defendant.
9
discovery requests may be attributed to defendant’s previous
counsel, all failures following the previous counsel’s
withdrawal lie with defendant.
Furthermore, as explained above, defendant has prejudiced
plaintiff by delaying this case, forcing plaintiff to incur the
expense of filing additional motions, wasting plaintiff’s time
by not appearing for the final pretrial conference and the Show
Cause hearing, and preventing plaintiff from contacting
defendant and proceeding with this litigation. Additionally, the
long list of defendant’s failures to comply with Court orders
and its obligations as a party to this litigation demonstrates a
history of proceeding in a dilatory fashion. Finally, less
drastic sanctions will not be effective in light of defendant’s
disregard for both the warnings of this Court and plaintiff’s
Motion for Sanctions.
III. DEFAULT JUDGMENT
A. Findings of Fact
Upon full review of the pleadings and the documents
submitted in proof of damages, the undersigned makes the
following findings of fact. 3
3
The record before the Court includes the Complaint (“Compl.”) (Dkt. 1), the
Brief in Support of Plaintiff’s Requested Damages (“Br. Supp. Dams.”) (Dkt.
38), the Tanya Johnson Declaration (“Johnson Decl.”) (Dkt. 39), the
Declaration of Brian L. Behmer in Support of Plaintiffs’ [sic] Proof of
Damages (“Behmer Decl.”) (Dkt. 40), the Declaration of Arthur House in
Support of Plaintiff’s Proof of Damages (“House Decl.”) (Dkt. 41),
Plaintiff’s Supplement to Tanya M. Johnson Declaration Exhibits (“Pl. Supp.
Exs.”) (Dkt. 43), and all attachments and exhibits submitted with those
10
Plaintiff Tanya M. Johnson, MD is an adult resident of
McLean, Virginia. (Compl. ¶ 1.) Defendant Robert Shields
Interiors, Inc. is a Maryland corporation with its principal
office in Gaithersburg, Maryland. (Id. at ¶ 2.) Defendant
regularly conducts business in Virginia and the District of
Columbia. (Id. at ¶ 3.)
Plaintiff hired defendant in September 2014 to perform
professional interior design, space planning, and decorating
services, including purchasing furniture, for her home in
McLean, Virginia. (Id. at ¶ 7; Johnson Decl. ¶ 3.) Defendant’s
principal and agent Robert Shields told plaintiff that defendant
would have the project done, or nearly done, by Thanksgiving and
the holiday season of 2014. (Compl. ¶ 8; Johnson Decl. ¶ 6.)
Plaintiff then executed a Letter of Agreement (“the Agreement”)
with defendant effective September 18, 2014 and paid defendant a
$10,000 non-refundable retainer. (Compl. ¶¶ 8-9, Ex. 1; Johnson
Decl. ¶ 6, Ex. B.)
Over the next several months, however, defendant did not
perform as agreed. Defendant was slow to start and unresponsive,
Mr. Shields was unavailable for large chunks of time, and the
project was well behind schedule when the 2014 holiday season
arrived. (Compl. ¶ 10; Johnson Decl. ¶ 7.) As a result,
plaintiff and her many visiting family and guests spent the
filings.
11
holidays in plaintiff’s home with most of the rooms unfurnished
– there was no dining room table, no breakfast table, and no
beds in any room. (Compl. ¶ 10; Johnson Decl. ¶ 7.)
Furthermore, under the Agreement, defendant was to help
procure furnishings for and design the majority of plaintiff’s
home. (Johnson Decl. ¶ 8, Ex. B) The Agreement provided that
defendant would earn an hourly fee for these services, and
defendant was entitled to a ten percent (10%) markup on shipping
and related services, but the Agreement did not provide for any
other markups, commissions, or fees. (Id.) The agreed budget was
$250,000.00. (Id. at ¶ 8.) From September 2014 to February 2015,
plaintiff then spent a total of $256,843.00 on the project. (Id.
at ¶ 10.) Notwithstanding these expenditures, though, many of
the rooms remain unfurnished. (Id.)
Moreover, several of the items plaintiff paid for were
either used, damaged, not the item that was ordered, or never
delivered. (Johnson Decl. ¶¶ 10-11; Compl. ¶ 10.) Plaintiff was
charged for but never received a Sutton Place king bed, a
dressing mirror, and an Idaho side chest. (Johnson Decl. ¶ 11,
Exs. D, G, H.) Plaintiff received and was charged for a foyer
cabinet that was supposed to be new, but the cabinet delivered
was clearly used, which defendant acknowledged, and it had a
damaged drawer. (Id. at ¶ 11, Ex. E.) Similarly, plaintiff
received and was charged for a coffee table that was delivered
12
in damaged condition, and which plaintiff had to repair at her
own expense. (Id. at ¶ 11, Ex. J.) In addition, plaintiff
received and was charged for a dining room table that was black
instead of brown (thus it does not match the rest of the dining
room furnishings) and was damaged with an indented scratch. (Id.
at ¶ 11, Ex. C.) Plaintiff also received and was charged for
dining room chairs, but although defendant agreed the price
would include reupholstering the end chairs, those chairs were
never reupholstered. (Id. at ¶ 11, Ex. I.) Finally, plaintiff
received and was charged for two lounge chairs that she never
approved, but which defendant left in her home and refused to
remove. (Id. at ¶ 11, Ex. F.)
Additionally, it was agreed that defendant’s fees for its
design and procurement services would be $18,750.00. (Id. at ¶
12.) However, defendant ultimately charged plaintiff $32,175.00.
(Id. at ¶ 12, Ex. K.)
Furthermore, plaintiff believes defendant’s shipping fees
to be excessive, and defendant did not attempt to consolidate
shipments. (Johnson Decl. ¶ 10; Compl. ¶ 10.) Defendant procured
a floor sample sofa for plaintiff from a showroom in Georgetown
and charged plaintiff $407.00 for shipping, freight, and
handling and $235.00 for local delivery to plaintiff’s McLean,
Virginia home. (Johnson Decl. ¶ 13, Ex. L.) Similarly, defendant
charged shipping of $863.00 and local delivery of $195.00 for a
13
living room console. (Id. at ¶ 15, Ex. N.) Relating to a
chandelier, defendant charged plaintiff (without her prior
authorization) $1,270.00 for rewiring, $665.00 for shipping,
freight, and handling, and $1,375.00 for local delivery and
installation by an electrician. (Id. at ¶ 14, Ex. M.)
Additionally, defendant represented at the outset that it had
access to a local warehouse to hold items so that they could be
delivered in a consolidated delivery. (Id. at ¶ 16.) However,
the above deliveries were all made separately, even though they
were made within days of February 4, 2015. (Id.)
Defendant also charged unauthorized and undisclosed markups
on the items delivered and/or received unauthorized rebates or
commissions on those purchases. (Johnson Decl. ¶¶ 10, 17; Compl.
¶ 10.) Under the Agreement, defendant was to provide its
services for an hourly fee, including procurement services to be
rendered. (Johnson Decl. ¶¶ 8, 17, Ex. B.) The Agreement further
authorized a ten percent markup on shipping and related services
but did not provide for any other markups, commissions, or fees.
(Id.) Defendant never provided any receipts, vendor invoices or
purchase orders to plaintiff that showed commissions or rebates
it was receiving from the vendors, and defendant refused to
provide proof of the furniture charges and shipping costs when
asked by plaintiff’s counsel. (Id. at ¶ 17.) In discovery,
however, plaintiff learned that defendant had undisclosed rebate
14
and commission arrangements with its vendors and was secretly
marking up most of the furniture items sourced for plaintiff by
anywhere from 35 to 100 percent. (Id.) For example, defendant
charged plaintiff $4,800.00 for a chaise lounge that only cost
defendant $2,481.00, and $11,000.00 for a breakfast table that
only cost defendant $5,999.40, which equates to markups of 93
percent and 83 percent respectively. (Id. at ¶ 18, Exs. P-Q.)
Finally, defendant’s principal and agent Robert Shields,
along with a friend named James, entered plaintiff’s home
without authorization on several occasions. (Johnson Decl. ¶ 19;
Compl. ¶¶ 12, 32.) Although defendant sent various emails, text
messages, and phone calls to Mr. Shields and defendant stating
that no one was authorized to enter her home without her advance
approval, these instructions were disregarded. (Johnson Decl. ¶
19; Compl. ¶¶ 31-32.) These instances unsettled plaintiff and
made her concerned for her safety. (Johnson Decl. ¶ 19; Compl. ¶
12.) Most notably, in late April 2015 plaintiff was upstairs in
her bedroom, alone and in her bathrobe having just gotten out of
her morning shower. (Johnson Decl. ¶ 20.) Plaintiff heard what
sounded like men in her home, which she immediately thought was
some type of home invasion as she had not received any advance
notice that anyone would need to come to her home. (Id.)
Plaintiff yelled down that she would call the police, and Mr.
Shields and another man identified themselves. (Id.) Plaintiff
15
was extremely shaken up by the incident and other similar
instances, which have caused her lingering anxiety, aggravation,
and emotional distress. (Id.)
B. Evaluation of Plaintiff’s Complaint
Where a defendant has defaulted, the facts set forth in the
plaintiff’s complaint are deemed admitted.
Before entering
default judgment, however, the Court must evaluate the
plaintiff’s complaint to ensure that the complaint properly
states a claim.
GlobalSantaFe Corp. v. Globalsantafe.com, 250
F. Supp. 2d 610, 612 n.3 (E.D. Va. 2003). As such, it is
appropriate to evaluate plaintiff’s claim against the standards
of Federal Rule of Civil Procedure 12(b)(6).
1. Breach of Contract
Plaintiff first alleges that defendant breached the
contract entered into by the parties. (Compl. ¶¶ 17-20.) "The
elements of a breach of contract action are (1) a legally
enforceable obligation of a defendant to a plaintiff; (2) the
defendant's violation or breach of that obligation; and (3)
injury or damage to the plaintiff caused by the breach of
obligation." Squire v. Va. Hous. Dev. Auth., 758 S.E.2d 55, 60
(Va. 2014) (quoting Filak v. George, 594 S.E.2d 610, 614 (Va.
2004)) (internal quotation marks omitted).
Here, defendant had legally enforceable obligations to
plaintiff pursuant to the Letter of Agreement signed by both
16
parties. (Compl. ¶ 17, Ex. 1; Johnson Decl. Ex. B.) Plaintiff
argues that defendant breached its obligations (1) by its slow
and unresponsive service, (2) by charging excessive shipping and
delivery costs and failing to coordinate shipments, (3) by
procuring furniture that was damaged, used, or not what was
ordered, and (4) by charging undisclosed and unauthorized
markups and design charges. (Br. Supp. Dams. 2; Johnson Decl. ¶
4.) Regarding the furniture that was damaged, used, or not what
was ordered, the language of the contract indicates that plans
and purchases were to be approved by plaintiff. For example, the
Agreement states that “[a]s selections are made, [defendant]
will provide [plaintiff] with detailed proposals and request
[plaintiff’s] signed approval.” (Compl. Ex. 1; Johnson Decl. Ex.
B.) Similarly, the Agreement states that defendant’s services
will include “supervision for the purpose of ascertaining that
approved plans and specifications are complied with.” (Compl.
Ex. 1; Johnson Decl. Ex. B) (emphasis added.) As such, furniture
that was damaged, used, or otherwise non-conforming, which in
each circumstance was not approved by plaintiff, represents a
breach of the obligation to only provide approved items.
Additionally, the Agreement states that defendant would be
compensated via an hourly billing rate, and the Agreement
further authorized a ten percent markup on shipping and related
services. (Johnson Decl. ¶¶ 8, 17, Ex. B; Compl. ¶ 10.) But the
17
Agreement did not provide for any other markups, commissions, or
fees. Thus defendant’s undisclosed markups on items procured for
plaintiff are also a breach of the Agreement.
In contrast, though, the Agreement does not contain any
language relating to the timetable for work to be performed, nor
does it contain any provision addressing the budget for
defendant’s design charges. Similarly, the Agreement does not
state that shipments will be consolidated or coordinated, and
the undersigned does not find the shipping and delivery fees
charged by defendant to be excessive. As such, these actions do
not constitute breaches of defendant’s obligations under the
Agreement.
As to the element of damages, plaintiff was clearly injured
when she paid for the damaged, used, or otherwise non-conforming
furniture, in some cases also paying for the necessary repairs
herself. (Johnson Decl. ¶ 11.) Similarly, plaintiff was clearly
injured when she paid defendant amounts including the
unauthorized markups. (Johnson Decl. ¶¶ 17-18; Pl. Supp. Exs.)
Therefore, plaintiff has pled sufficient facts to state a claim
for breach of contract by defendant as to the damaged, used, or
otherwise non-conforming furniture and the unauthorized markups.
2. Violation of the Virginia Consumer Protection Act of 1977
Plaintiff’s second cause of action is for violation of the
Virginia Consumer Protection Act of 1977 (“VCPA”), Va. Code Ann.
18
§§ 59.1-196 et seq. (Compl. ¶¶ 23-27.) Any person who suffers
loss as the result of a violation of the VCPA is entitled to
bring suit to recover his/her damages. Va. Code Ann. § 59.1204(A). As a preliminary issue, the VCPA applies to dealings
between suppliers and the consuming public. Id. § 59.1-197.
“Supplier” is defined as, inter alia, a seller, lessor or
licensor who advertises, solicits or engages in consumer
transactions. Id. § 59.1-198. "Consumer transaction" is defined
to include the advertisement, sale, lease, license or offering
for sale, lease or license, of goods or services to be used
primarily for personal, family or household purposes. Id. In the
instant case, defendant provided goods and services to
plaintiff, in Virginia, in connection with a consumer
transaction, namely the purchase of furniture for and the
interior design of plaintiff’s home. (Compl. ¶¶ 23-24; Johnson
Decl. ¶ 3.) Therefore, defendant is subject to the VCPA.
Under the VCPA, prohibited acts include: (a)
misrepresenting that goods or services have certain
characteristics; (b) misrepresenting that goods or services are
of a particular standard, quality, grade, style, or model; (c)
offering for sale goods that are used, secondhand, repossessed,
defective, blemished, deteriorated, or reconditioned without
clearly identifying the goods as such; (d) offering goods or
services with intent not to sell them at the price or upon the
19
terms offered; and (e) using deception, fraud, false pretense,
false promise, or misrepresentation in connection with a
consumer transaction. See Va. Code Ann. § 59.1-200(5)-(8), (14).
Here, plaintiff has pled that defendant committed each of
the above violations. As to violations (a) and (b), defendant
charged plaintiff for and provided to her a dining room table
that was black, not brown as promised and dining room end chairs
that were not reupholstered as agreed. (Johnson Decl. ¶ 11, Exs.
C, I.) As to violation (c), defendant charged plaintiff for and
provided to her a foyer cabinet that was used rather than new,
and which also had a damaged drawer. (Id. at ¶ 11, Ex. E.)
Similarly, plaintiff received and was charged for a damaged
coffee table and the previously described dining room table was
damaged with an indented scratch. (Id. at ¶ 11, Exs. C, J.)
Finally, as to violations (d) and (e), defendant had undisclosed
rebate and commission arrangements with its vendors and it
charged plaintiff undisclosed markups for many of the furniture
items procured. (Id. at ¶¶ 10, 17; Compl. ¶ 10.) For example,
defendant charged plaintiff $4,800.00 for a chaise lounge that
only cost defendant $2,481.00, and $11,000.00 for a breakfast
table that only cost defendant $5,999.40. (Johnson Decl. ¶ 18,
Exs. P-Q.) However, under the Agreement, defendant was only
permitted to charge markups of ten percent for shipping and
related services. (Id. at ¶¶ 8, 17, Ex. B.)
20
In this light, plaintiff has established a violation of the
VCPA by defendant.
3. Trespass
Plaintiff’s third and final claim is for trespass. (Compl.
¶¶ 30-33.)
[I]n order to maintain a cause of action for trespass
to land, the plaintiff must have had possession of the
land, either actual or constructive, at the time the
trespass was committed. In addition, . . . a plaintiff
must prove an invasion that interfered with the right
of exclusive possession of the land, and that was a
direct result of some act committed by the defendant.
Any physical entry upon the surface of the land
constitutes such an invasion . . . .
Kurpiel v. Hicks, 731 S.E.2d 921, 925 (Va. 2012) (quoting Cooper
v. Horn, 448 S.E.2d 403, 406 (Va. 1994)). In this case,
plaintiff owns and has actual possession of the real property
located at 909 Chinquapin Road, McLean, Virginia 22102. (Compl.
¶ 30.) Furthermore, plaintiff has pled that, on multiple
occasions, agents of defendant – namely Robert Shields and his
friend James – physically entered plaintiff’s property and home
without her permission and in contravention of the express
denials of permission that plaintiff had communicated to
defendant. (Johnson Decl. ¶¶ 19-20; Compl. ¶¶ 31-32.) Because a
corporation acts through its agents, defendant is liable for the
acts of its agents while they act within the scope of
employment. See State Farm Fire & Cas. Co. v. Singh, CIVIL NO.
3:05CV834, 2006 U.S. Dist. LEXIS 33474, *16-17 (E.D. Va. May 25,
21
2006); see also Commodity Futures Trading Comm'n v. Weintraub,
471 U.S. 343, 348 (1985) (“As an inanimate entity, a corporation
must act through agents.”) During Mr. Shields’s entries, he
would take and leave items. (Johnson Decl. ¶ 19, Ex. A.) Such
actions seem clearly to be within the scope of his employment
with defendant to procure furniture for plaintiff’s home and to
perform interior design of the home. As such, plaintiff has
sufficiently stated a claim of trespass against defendant.
C. Requested Relief
1. Damages
Plaintiff first seeks damages for plaintiff’s unlawful
actions. (Compl. ¶ 34; Johnson Decl. ¶ 5.) For defendant’s
breach of contract, plaintiff is entitled to the damages that
she incurred as a result of defendant’s breaches. Plaintiff
incurred damages of $46,263.00 relating to the damaged, used, or
otherwise non-conforming furniture, for which defendant charged
her. (Johnson Decl. ¶ 11, Exs. C-J; Br. Supp. Dams. 3.)
Plaintiff also paid defendant a total of $24,506.50 in
unauthorized and undisclosed markups. 4 (Johnson Decl. ¶¶ 17-18,
Exs. P-Q; Pl. Supp. Exs.) Therefore, plaintiff is entitled to
4
Plaintiff in her declaration and brief in support of damages calculates her
damages regarding defendant’s undisclosed markups by calculating the average
markup and then applying this to the total amount of furnishings purchased,
not including the damaged, used, or otherwise non-conforming furniture for
which damages are already sought. (Johnson Decl. ¶ 18; Br. Supp. Dams. 2.)
However, plaintiff cites no authority for calculating damages in this manner.
As such, the undersigned has calculated plaintiff’s damages based on the
invoices and purchase orders provided, showing the amount in markups
plaintiff paid for those items.
22
the total amount of $70,769.50 based on defendant’s breaches of
the Agreement.
Alternatively, under the VCPA, a person that suffers a loss
due to a violation of the statute is entitled to recover her
actual damages, or $500, whichever is greater. Va. Code Ann. §
59.1-204(A). As noted above, defendant violated the VCPA by
providing plaintiff with and charging her for damaged, used, or
otherwise non-conforming furniture that was not what plaintiff
approved. As a result, plaintiff suffered a loss in the amount
of $46,263.00. (Johnson Decl. ¶ 11; Br. Supp. Dams. 3.) In
addition, defendant also violated the VCPA by charging plaintiff
undisclosed markups on furniture procured, even though the
Agreement stated that defendant would be compensated via an
hourly billing rate and did not authorize any such markups.
(Johnson Decl. ¶¶ 8, 17, Ex. B; Compl. ¶ 10.) As such, plaintiff
suffered a loss in the amount of defendant’s unauthorized
markups, to which she is now entitled. Based on a review of all
the purchase orders and invoices provided by plaintiff,
defendant charged plaintiff markups in the amount of $24,506.50.
(Johnson Decl. ¶¶ 17-18, Ex. P-Q; Pl. Supp. Exs.)
Plaintiff also requests treble damages under the VCPA for
defendant’s markups. That statute provides that, “[i]f the trier
of fact finds that the violation was willful, it may increase
damages to an amount not exceeding three times the actual
23
damages sustained, or $1,000, whichever is greater.” Va. Code
Ann. § 59.1-204(A). Here, in light of the nature of defendant’s
violations (marking-up plaintiff’s items without her knowledge
or authorization) and defendant’s refusal to provide cost
documentation to plaintiff or her attorney upon their request,
the Court finds that defendant’s actions were clearly willful.
As such, treble damages are appropriate. Thus, under the VCPA,
defendant is liable to plaintiff for its unauthorized and
undisclosed markups in the total amount of $73,519.50.
Plaintiff also seeks damages for her emotional distress and
aggravation resulting from defendant’s trespasses. (Br. Supp.
Dams. 3; Johnson Decl. ¶¶ 5, 20; Compl. ¶¶ 33-34.) Plaintiff has
stated that she was extremely shaken up by the various trespass
incidents, most notably the episode in late April 2015 when Mr.
Shields and another came into her home without authorization
when she was alone and had just gotten out of the shower.
(Johnson Decl. ¶ 20.) Plaintiff states that she now suffers
lingering anxiety from those events, as she still thinks about
hearing men in the house, particularly when she is alone, and
she must frequently reassure herself that everything is alright
when she hears noises in her house. (Id.) Consequently,
plaintiff requests $10,000.00 in damages. (Id.)
Where the alleged trespass is deliberate and accompanied by
aggravating circumstances, damages for emotional distress may be
24
recovered in the absence of physical injury. Johnson v. Marcel,
465 S.E.2d 815, 817 (Va. 1996). Here, defendant’s trespass was
clearly deliberate. (Johnson Decl. ¶¶ 19-20.) As such, whether
plaintiff can recover damages for her emotional distress turns
on whether there were aggravating circumstances. In Johnson v.
Marcel, the Court found that the defendant’s trespass, which was
accompanied by her harassment of the plaintiffs, satisfied this
standard. See 465 S.E.2d at 816-17 (describing the defendant’s
actions, including that she pulled the plaintiffs' telephone out
of the wall, blocked the plaintiffs' driveway, and made
excessive noise).
In this case, defendant’s principal and agent Robert
Shields, along with a friend named James, entered plaintiff’s
home without authorization on several occasions. (Johnson Decl.
¶ 19; Compl. ¶¶ 12, 32.) These intrusions were despite the
numerous emails, text messages, and phone calls that plaintiff
sent to Mr. Shields and defendant stating that no one was
authorized to enter her home without her advance approval.
(Johnson Decl. ¶ 19; Compl. ¶¶ 31-32.) Mr. Shields would then
take and leave items without plaintiff’s authorization. (Johnson
Decl. ¶ 19, Ex. A.) Finally, the April 2015 trespass caught
plaintiff in the upsetting position of being by herself, in her
bathrobe, having just gotten out of her morning shower. (Id. at
¶ 20.) Therefore, the undersigned concludes that defendant’s
25
actions amount to sufficiently aggravating circumstances to
entitle plaintiff to the relatively modest amount requested of
$10,000.00 for her emotional distress.
2. Attorneys’ Fees and Costs
In addition to any damages awarded, a person who suffers
loss due to a violation of the VCPA may also be awarded
reasonable attorneys’ fees and costs. Va. Code Ann. § 59.1204(B). As noted above, defendant committed willful violations
of the VCPA. Furthermore, plaintiff attempted to resolve this
dispute with defendant and defendant’s counsel prior to bringing
this lawsuit, but defendant refused. (Johnson Decl. ¶ 21, Ex. A;
Br. Supp. Dams. 3, 5.) Additionally, defendant has consistently
failed to comply with the orders of this Court and has failed to
participate in good faith in this case. Therefore, the
undersigned concludes that an award of reasonable attorneys’
fees and costs is appropriate in this case.
In support of her request for attorneys’ fees and costs,
plaintiff submitted the Declaration of Brian L. Behmer in
Support of Plaintiffs’ [sic] Proof of Damages and the
Declaration of Arthur House in Support of Plaintiff’s Proof of
Damages, which both included itemized invoices describing the
work performed and resulting fees and costs. (Dkts. 40 and 41.)
26
Plaintiff seeks $119,640.62 in attorneys’ fees, 5 comprised of
172.7 hours by attorney Brian Behmer at a rate of $475.00 per
hour, 6 66.5 hours by attorney Arthur House at a rate of $510.00
per hour, 7 20.7 hours by attorney Jessica Summers at a rate of
$250.00 per hour, and 10.5 hours by law clerk Nancy Turner at a
rate of $165.00 per hour. (Behmer Decl. ¶¶ 4-5, Ex. A; House
Decl. ¶¶ 3-6, 8, Ex. A; Johnson Decl. ¶ 21, Ex. R; Br. Supp.
Dams. 5.) Plaintiff further seeks $1,009.44 in costs and
expenses. 8 (Johnson Decl. Ex. R; Behmer Decl. Ex. A; House Decl.
Ex. A.) The undersigned has reviewed the declarations of Mr.
Behmer and Mr. House and finds that these amounts are reasonable
and necessary to enforce plaintiff’s rights. Therefore,
plaintiff will be awarded $119,640.62 in attorneys’ fees and
$1,009.44 in costs.
3. Pre-judgment Interest
Plaintiff further seeks pre-judgment interest on her
damages. (Br. Supp. Dams. 5-6.) Pursuant to Va. Code Ann. §
5
Because plaintiff did not include Paley Rothman’s January 2016 services in
her calculations, plaintiff requests $118,659.87 in attorneys’ fees. (Johnson
Decl. Ex. R.) However, based on the declarations of plaintiffs’ attorneys and
the invoices attached thereto, which include Paley Rothman’s January 2016
services, the undersigned has determined that the correct amount of
attorneys’ fees is $119,640.62.
6
Mr. Behmer did not charge for certain hours worked and applied a five
percent discount on two occasions. Taking that into consideration, Mr. Behmer
actually charged for approximately 167.4 hours at the above rate.
7
Mr. House applied a five percent discount on one occasion, thus Mr. House
actually charged for approximately 65.2 hours at the above rate.
8
Because plaintiff’s calculations do not include Paley Rothman’s January 2016
costs, plaintiff requests $1,006.44 in costs. (Johnson Decl. Ex. R.) Based on
the declarations of plaintiffs’ attorneys and the invoices attached thereto,
which include Paley Rothman’s January 2016 costs, the undersigned has
determined that the correct amount of costs is $1,009.44.
27
8.01-382, a trial court may award pre-judgment interest within
its discretion. Upon a full review of this case, however, the
undersigned determines that an award of pre-judgment interest is
not appropriate. Moreover, under Virginia law, pre-judgment
interest must be requested in a pleading before it can be
awarded by a trial court. Devine v. Buki, 767 S.E.2d 459, 468
(Va. 2015). Here, although plaintiff mentions pre-judgment
interest in paragraph 21 of her Complaint, plaintiff does not
specifically ask for pre-judgment within her request for relief.
(Compl. ¶ 34.) Therefore, plaintiff cannot now recover prejudgment interest on her damages.
IV. CONCLUSION
For the foregoing reasons, the undersigned Magistrate Judge
concludes that default judgment should be entered against
defendant Robert Shields Interiors, Inc. as to plaintiff Tanya
M. Johnson’s Complaint in the total amount of $250,433.06,
comprised of: $46,263.50 for defendant’s breach of contract — or
alternatively for defendant’s violation of the VCPA — for
providing plaintiff with and charging her for damaged, used, or
otherwise non-conforming furniture; $73,519.50 for defendant’s
unauthorized and undisclosed markups in violation of the VCPA,
including trebling under that statute for defendant’s willful
violations; $10,000.00 for plaintiff’s emotional distress
suffered due to defendant’s willful trespasses; $119,640.62 in
28
attorneys' fees; and $1,009,44 in costs. The undersigned
Magistrate Judge further concludes that the Counterclaim of
defendant Robert Shields Interiors, Inc. should be dismissed
with prejudice.
An appropriate order will issue.
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Theresa Carroll Buchanan
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;ESA CARROLL BUCHANAN
UNITED STATES MAGISTRATE JUDGE
May
2016
Alexandria, Virginia
29
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