Court Opinion

ID: 2665212
Source: CourtListenerOpinion
Date Created: 2014-04-04 07:21:19.539648+00
Date Added: 2024-06-11T13:24:23.382409
License: Public Domain

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA

KRISHNA MUIR,
Plaintiff,

v Civil Case No. 03-1193 (RJL)

NAVY FEDERAL CREDIT UNION, et
al.,

FILED

SEP 2 9 2010

Clerk. u.s. o' n z
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MEMORANDUM OPINION
(Septemberz__°(, 2010) [#87]

Defendants.

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Plaintiff Krishna Muir brought this action against Navy Federa1 Credit Union
("NFCU") on June 3, 2003. Plaintiff claims that NFCU tortiously set off and converted a
joint bank account held by plaintiff and his father in the amount of $27,022.90 to satisfy a
debt that had been incurred by his father, individually. After prolonged litigation, this
case is once again before this Court; this time on NFCU’s Motion for Summary
Judgment.l The only claims against NFCU remaining are plaintiffs claims of tortious

interference with a business expectancy, lost profits and interest.z For the following

1 Plaintiff brought this suit against NFCU and Patricia Dearing, LLC, a law finn retained
by NFCU to collect on plaintiff’ s father’s debt ("Dearing"). Plaintiff’s claims against
Dearing are also before this Court on Dearing’s Motion for Summary Judgment [#88]
and have been disposed of in a Memorandum Opinion issued concurrent with this one.

z After two appeals and various decisions by this Court, all other claims against NFCU
raised in plaintiffs complaint have been decided.

l

reasons, the defendant’s Motion for Summary Judgment as to all claims is GRANTED.
The plaintiff is awarded interest, however, in the amount of $4,365.41.
BACKGROUND
The facts of this case have been recounted through various rulings both by this

Court and our Circuit Court and do not require a lengthy reiteration here.3 In short, on
October 2, 2002, plaintiff deposited $29,015.55 in a joint account at NFCU that plaintiff

held with his father. Compl. ‘ll 9. NFCU proceeded to set off that account in the amount

of $27,022.90 to satisfy a debt that been incurred by his father, individually. NFCU Stmt.

of Facts, Sept. 24, 2009 ("NFCU Stmt")1l l0. Because of the reasons set forth in my
March 1, 2005 memorandum opinion and order, I awarded plaintiff actual damages in the
amount of $27,022.90. Muir v. Navy Fed. Crea'il Unz'on, No. 03-1193, 2005 U.S. Dist.
LEXIS 3559, at *3-4 (D.D.C. Mar. l, 2005) . Over the course of the next two years, this
Court went on to, inter alia, grant defendant’s motion to dismiss plaintiffs claims of
tortious interference with a business expectancy, lost profits, and punitive damages, grant
defendant’s motion for summary judgment on plaintiffs claim of breach of fiduciary
duty, and deny plaintiff s request for interest. In 2008, our Circuit Court remanded the
case for reconsideration on the issue of plaintiffs claim of tortious interference, lost
profits, and interest. Muir v. Navy Fea’. Credit Union, 529 F.3d ll00 (D.C. Cir. 2008). lt
affirmed this Court’s rulings, however, on all other issues relating to defendant NFCU.

Ia’.

3 See Muir v. Navy Fed. Credit Union, 529 F.3d 1100 (D.C. Cir. 2008); Muir v. Navy Fed.
Credz`t Union, 484 F. Supp. 2d 3 (D.D.C. 2007); Muir v. Navy Fea'. Credil Um`on, No. 03-
ll93, 2005 U.S. Dist. LEXIS 3559 (D.D.C. Mar. l, 2005).

2

ANALYSIS

Summary judgment is appropriate when the record demonstrates that "there is no
genuine issue as to any material fact and that the moving party is entitled to a judgment
as a matter of law." Fed. R. Civ. P. 56(c). In considering a motion for summary
judgment, "[t]he evidence of the nonmovant is to be believed, and all justifiable
inferences are to be drawn in his favor." Anderson v. Liberly Lobby, Inc., 477 U.S. 242,
255 (1986). However, in opposing a motion for summary judgment, the non-moving
party "may not rest upon the mere allegations or denials of his pleading, but . . . must set
forth specific facts showing that there is a genuine issue for trial." Id. at 248 (citing Fed.
R. Civ. P. 56(e)). Moreover, "[t]he mere existence of a scintilla of evidence in support of
the [non-movant]’s position will be insufficient." Ia’. at 255. "If the evidence is merely
colorable, or is not significantly probative, summary judgment may be granted." Id. at
249-50 (citations omitted).

I. Tortious Interference and Lost Profits

Under Virginia law,4 a claim of tortious interference with a business expectancy
requires: (l) a business expectancy with a probability of future economic benefit; (2)
defendant’s knowledge of the expectancy; (3) reasonable certainty that without
defendant’s intentional misconduct, plaintiff would have realized the expectancy; and (4)
damages, Commercz'al Bus. Sys. v. Halifax Corp., 484 S.E.2d 892, 896 (Va. 1997); Glass

v. Glass, 321 S.E.2d 69, 77 (Va. 1984).

" Plaintiffs surviving claims against defendant NFCU are before this Court under

diversity jurisdiction, and it is uncontested that Virginia law applies. Mem. Op. and
Order of Mar. l, 2005 at 2, n. l.

Further, Virginia law protects only specific expectancies. Thus, the mere
expectation to engage in business is not sufficient to sustain a claim of tortuous
interference, See A)nerican Tel. & Tel. Co. v. Eastern Pay Phones, Inc., 767 F. Supp.
l335, 1340 (E.D. Va. 1991), opinion vacated on non-substantive grounds, 789 F. Supp.
725 (E.D. Va. 1992) ("'l`he expectancy of remaining in business is too general to support
a tortious interference claim under Virginia law."). Likewise, defendant’s knowledge
must be similarly specific. Levine v. McLeskey, 881 F. Supp. 1030, 1058 (E.D. Va. 1995)
(applying Virginia law to find that only knowing that the plaintiff generally "wished to
develop apartments" was not sufficient knowledge to sustain a tortious interference claim
when the business expectancy in question was plaintiff s acquisition of financing); see
also Long v. Ola' Point Bank, 41 Va. Cir. 409, 428 (Va. Cir. 1997) (noting that knowledge
of the specific business expectancy is sufficient to sustain the knowledge element in a
claim of tortious interference); Bill Greever Corp. v. Tazewell Nat'l Bank, 41 Va. Cir.
298, 305-06 (Va. Cir. 1997) (same).

With respect the future benefit, Virginia law protects a specific business
expectancy only when there is reasonable probability of future economic benefit and only
when, applying an objective test, there is a reasonably certainty that without the
defendant’s misconduct, plaintiff would have realized the expectancy. Co)nmercial Bus.
Sys., 484 S.E.2d at 897. In other words, "[p]roof of a ‘possibility’ that such benefit will
accrue is insufficient." Id.

In addition, in order to recover lost profits under any theory of liability including
tortious interference, a plaintiff must put forth evidence that "affords a sufficient basis for

4

estimating" the amount of lost profits being claimed. Boggs v. Duncan, 121 S.E.2d 359,
363 (Va. 1961). Thus, lost profits cannot be recovered if they are contingent or
uncertain. Haywood v. Massie, 49 S.E.2d 281, 283 (Va. 1948). Moreover, while past
performance in an existing business may be indicative of future profits, profits associated
with a new business or enterprise, which are contingent on various factors including
future bargains and the market, are often too speculative as a general rule to support a
claim for lost profits under Virginia law. Clark v. Scott, 520 S.E.2d 366, 370 (Va. 1999);
Mullen v. Brantley, 195 S.E.2d 696, 700 (Va. 1973). For the same reasons, profits
associated with fixture real estate transactions are similarly speculative. Murray v. Hadia’,
385 S.E.2d 898, 904-05 (Va. 1989); see also Tabbaie v. Ramos, 2007 Va. Cir. LEXIS
ll2, *9-11 (Fairfax Co. Cir. Ct., Aug. 3, 2007).

Here, there is no evidence that defendant had knowledge of the alleged business
expectancy.5 In fact, plaintiff admitted during his deposition that he refused to disclose to
NFCU why he required the Hmds, saying only that he needed money for a "business
opportunity" or "business venture." Muir Dep. 40:9-12, 291 :8»292:4. When asked if
plaintiff told NFCU any details about the "business opportunity," plaintiff stated that it

was none ofNFCU’s business. Ia’ 291 :17-20.

5 NFCU also claims that because plaintiff did not respond on Summary Judgment to
NFCU’S Statement of Undisputed Facts, it violated LCvR7(h)(l) and the Court must find
that all the facts set forth in the Statement must be considered conceded. NFCU’S Reply
at 2. This Court finds, notwithstanding, that even accepting the facts alleged by plaintiff
in his pleadings and exhibits as conceded, for the reason’s herein, plaintiffs claims
cannot survive summary judgment.

Further, notwithstanding NFCU’s limited knowledge, plaintiff has set forth no
evidence, which - even under the favorable standard of summary judgment - would be
sufficient for a reasonable jury to find that there was a probability of future economic
benefit. Indeed, plaintiff s claim that he was precluded from investing in at least three
properties in and around Washington, D.C., is based on evidence which hardly presents a
possibility, let alone probability, of future profits. How so?

The first real estate investment plaintiff proffers was located in Germantown,
Maryland ("Property l") and belonged to Michel1e Turner ("Turner"). Plaintiff claims

that he and Turner had an agreement whereby he would satisfy Turner’s outstanding debt

on Property 1 (approximately $8000) and invest in improvements (approximately $1000).

Pl. Opp’n at 10-1l. ln exchange, plaintiff would keep any profits from the sale above the
$120,000 value of the outstanding mortgage. Ia’. However, at her deposition, Turner
stated that, aside from recalling that plaintiff was going to help her avoid foreclosure, she
could not recall what agreement, if any, she had with plaintiff Tumer Dep. 53: 5-19;
Turner Dep. 45:14-48:3; see also Muir Dep. 247 :6~22. At best, this evidence indicates
that Turner and plaintiff possibly agreed to split any profits that might result if a future
sale occurred at a price above $120,000. Turner Dep. 53: 5-19.

Further, plaintiff based his valuation of Property 1 on listings of two homes in the
area that had sold for $155,000 and $161,000, respectively, but that he had never visited

and could not thus compare to Property 1. Muir Dep. 249:20-250:3, 251 :8-255:9.6

6 The two homes had sold for $155,000 and $161,000, respectively. Muir Dep. 249:20-
250:3.

Indeed, Turner ultimately sold Property 1 for $120,000. Ia’. 255:l0-257:3. While
plaintiff claims that Turner was desperate to unload the property and, therefore, settled
for a lower price, plaintiff provided no evidence beyond the so-called "comparables" to
indicate that he could have yielded $38,000 more on the sale. See 249:20~257:3.
Moreover, plaintiff, at a minimum, would have had to yield $9000 more on the sale just
to break even. Ia’. Thus, applying an objective standard, no reasonable jury could find a
probability of future profit for plaintiff arising out of this investment opportunity.

The second property plaintiff proffered was located at a different location in
Germantown Maryland ("Property 2"), and is based on the evidence even more
attenuated. For starters, plaintiff presented no evidence that an agreement even ever
existed between plaintiff and the owner of Property 2. See, e.g., Muir Dep. 263 :3-264:6,
317:2-320:1; see also Pl. Opp’n at ll-12. Indeed, plaintiff could not even recall the
owner’s name! Muir Dep. 263:9-11. Moreover, plaintiff provided no evidence
regarding the prices for which he expected to buy or sell Property 2. See, e.g., Muir Dep.
263:3-264:6, 317:2-320:1; see also Pl. Opp’n at ll-12. Again, plaintiff claims that he
based his estimated profits on comparables, but does not claim to have even visited the
comparable properties. Muir Dep. 263:12-264:1. Simply put, no reasonable jury could
find that plaintiff could strike a deal with the owner, let alone turn a profit on the
property. Thus, plaintiff once again fails to meet his burden.

Finally, the third investment property plaintiff offers was located on Hamlin Street
in Washington, DC ("Property 3"). While plaintiff and a partner named Knaichica Ruffin
("Ruffin") did make an investment that earned them a profit on this property, Pl. Opp’n at

7

l2, his claim that he would have invested a_l@§ if he had access to his funds at NFCU is
totally unsubstantiated. See Muir Dep. 195:15-211:14; 264: 10-270:22; 310:2-312:22.
To the contrary, Ruffin testified at her deposition that she introduced the investment
opportunity to plaintiff because she needed a partner to manage the repairs on the house.
Ruffin Dep. 122:8-132:17. Such evidence is hardly sufficient to prove the possibility,
much less the probability, that plaintiff could have invested in the property without
Ruffin as his partner.7
II. Interest

ln accordance with my Order of January 4, 2007, plaintiff submitted a schedule of
damages claiming $4,365.41 in interest, calculated at rate of 6% per annum over the
course of 2 years, 6 months, and 25 days. Pl. Sched. Damages, Jan. 29, 2007. The award
of prejudgment interest is, of course, within "the sound discretion of the trial court."
Skretvea’t v. Koari, 445 S.E.2d 48l, 487 (Va. 1994) (citing Va. Code Ann. § 8.01-382).
Moreover, the Virginia Supreme Court has held that awarding interest compensates
plaintiff "for the loss sustained by not receiving the amount to which he was entitled at
the time he was entitled to receive it, and such award is considered necessary to place the

[plaintiff] in the position he would have occupied if the party in default had fulfilled his

7 Notwithstanding the above, under any theory of liability, plaintiff could not recover his
alleged lost profits under Virginia law. Moreover, his claim to having successfully
invested in a property in Florida is to no avail. See Pl. Opp’n at 9. Success in one real
estate market cannot be indicative of success in another - particularly in the case of
markets as different as Washington, D.C. and Florida. See Murray v. Haa’ia’, 385 S.E.2d
898, 904-05 (Va. 1989). Further, plaintiffs claims that he used comparables to estimate
his profits are equally as unconvincing, particularly when plaintiff must admit that he
never visited the compared properties. ld. Ultimately, therefore, plaintiffs claims of
tortious interference and lost profits cannot survive summary judgment.

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obligated duty." Marks v. Sanzo, 345 S.E.2d 263, 267 (Va. 1986) (alteration in original)
(internal citation omitted).

On March l, 2005, 1 awarded plaintiff $27,022.90, finding that NFCU had
wrongly set off those funds from his joint account. Having made that determination, it
seems reasonable that NFCU should pay plaintiff, in addition to his actual damages of
$27,022.90, interest on those funds. Because plaintiffs calculation covers the
prejudgment period during which NFCU had control over his funds, including the period
during which the Court’s holding was vacated, and because Virginia law mandates the
rate of 6%, Va. Code Ann. § 6.1-330.54, I agree with plaintiffs calculation and will
award him $4,361.45 in interest.

CONCLUSION

Accordingly, for the foregoing reasons, the Court GRANTS defendant Navy
Federal Credit Union’s Motion for Summary Judgment [#87] and awards plaintiff
$4,361.45 in interest on my earlier award. An Order consistent with this decision

accompanies this Memorandum Opinion.

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RICHARD J.`EE€)N
United States District Judge