Court Opinion

ID: 9388555
Source: CourtListenerOpinion
Date Created: 2023-04-20 21:00:59.887477+00
Date Added: 2024-06-11T17:18:20.842883
License: Public Domain

USCA4 Appeal: 21-2031      Doc: 38         Filed: 04/19/2023    Pg: 1 of 23

                                            UNPUBLISHED

                               UNITED STATES COURT OF APPEALS
                                   FOR THE FOURTH CIRCUIT

                                              No. 21-2031

        JTH TAX, LLC, f/k/a JTH Tax, Inc., d/b/a Liberty Tax Services; SIEMPRETAX+,
        LLC,

                            Plaintiffs − Appellants,

                     v.

        BABLU SHAHABUDDIN,

                            Defendant – Appellee.

        Appeal from the United States District Court for the Eastern District of Virginia, at
        Norfolk. Rebecca Beach Smith, Senior District Judge. (2:20−cv−00217−RBS−DEM)

        Argued: December 8, 2022                                          Decided: April 19, 2023

        Before DIAZ and THACKER, Circuit Judges, and FLOYD, Senior Circuit Judge.

        Affirmed by unpublished opinion. Judge Diaz wrote the opinion, in which Judge Thacker
        and Senior Judge Floyd joined.

        ARGUED: Amy Mason Saharia, WILLIAMS & CONNOLLY LLP, Washington, D.C.,
        for Appellants. James Richard Harvey, III, WOODS ROGERS VANDEVENTER
        BLACK LLP, Norfolk, Virginia, for Appellee. ON BRIEF: Dustin M. Paul, Gaela R.
        Normile, VANDEVENTER BLACK LLP, Norfolk, Virginia, for Appellee.

        Unpublished opinions are not binding precedent in this circuit.
USCA4 Appeal: 21-2031      Doc: 38         Filed: 04/19/2023     Pg: 2 of 23

        DIAZ, Circuit Judge:

               This case began with the termination of the franchise relationship between Bablu

        Shahabuddin and his former franchisor, JTH Tax, Inc., d/b/a Liberty Tax Service, and

        SiempreTax+, LLC (“Liberty”). As is often the case with commercial disentanglements,

        there were loose ends, and each party now finds fault with the other’s later actions.

               Liberty claims Shahabuddin breached his contractual obligation to assign leases for

        certain properties where he had operated franchises. Shahabuddin claims Liberty shorted

        him on a revenue-sharing payment due under a later agreement. The district court granted

        summary judgment for Shahabuddin on both claims. We affirm.

                                                     I.

                                                    A.

               Liberty offers tax-preparation services nationwide. Shahabuddin, Liberty’s former

        franchisee, operated locations in New York, California, and Nevada before the parties

        terminated their franchise relationship in 2016.

               To manage their corporate breakup, the parties entered into a Purchase and Sale

        Agreement (“PSA”). Shahabuddin agreed to sell Liberty the “assets, properties and rights”

        of his Liberty franchises and to assign certain commercial leases upon Liberty’s request.

        J.A. 402, 405–07.      The PSA specifically contemplated the assignment of eighteen

        properties in New York, listed in “Schedule C.” J.A. 416. But it also allowed Liberty to

        seek assignment of other properties: Part 8(e) of the PSA stated that “to the extent any

        leases associated with [Shahabuddin’s franchises] have not been assigned to [Liberty] and

                                                     2
USCA4 Appeal: 21-2031       Doc: 38         Filed: 04/19/2023    Pg: 3 of 23

        [Liberty] requests such assignment, [Shahabuddin] agrees to assign such leases to [Liberty]

        immediately.” J.A. 405–06.

               The parties executed the PSA in June 2016, and their lawyers later exchanged

        several emails related to lease assignment. The PSA contemplated that the assignments

        would occur by the closing, 1 and the emails reflect that urgency. In the same message

        delivering the executed PSA to Shahabuddin, Liberty’s counsel requested the

        “lease[]agreements for those locations listed in Schedule C” so their team could review and

        begin contacting landlords. J.A. 192. In another message, Liberty’s counsel noted they

        were “working to get [the leases] assigned as quickly as possible,” emphasizing that doing

        so was “in all of the parties’ interest.” J.A. 212.

               Liberty, however, didn’t want all the properties in Schedule C. Its counsel informed

        Shahabuddin’s in mid-July that Liberty was “not taking” the leases for two such properties.

        J.A. 198. Shahabuddin’s counsel pointedly responded: “Are these decisions final, and

        should [Shahabuddin] proceed to dispose of the leases?” J.A. 197. Liberty’s counsel

        confirmed, “Yes, we are not moving forward with these,” and directed Shahabuddin to

        transfer equipment and customer files from the two locations to Liberty. Id.

               1
                The representations and warranties in the PSA were “deemed to have been given
        upon the execution of this Agreement and upon the Closing Date.” J.A 406. Liberty sent
        Shahabuddin the fully executed agreement on July 1, 2016. And the PSA defined the
        “Closing Date” as Liberty’s delivery to Shahabuddin “of an executed copy of this
        Agreement . . . and Assumption and Assignment forms and [Liberty’s] acceptance in
        Virginia by [Liberty’s] authorized officer.” J.A. 404.

                                                       3
USCA4 Appeal: 21-2031      Doc: 38         Filed: 04/19/2023     Pg: 4 of 23

               A month later, Shahabuddin’s counsel wrote, “We understand that Liberty does not

        want any of the other properties that were not on Schedule C, and that [Shahabuddin]

        should dispose of them. Please let me know if there are any that [Liberty] is interested in

        getting assignments on.” J.A. 202. Liberty’s counsel replied, “I am not aware of any other

        leases Liberty wants to acquire, but will confirm with our leasing team.” J.A. 212. Nothing

        in the record suggests Liberty followed up with any requests for non-Schedule C leases at

        that time.

               Finally, in mid-November, Liberty reaffirmed that it would not take the lease for

        one of the properties it identified in July and informed Shahabuddin that it was also “not

        taking” the leases for two more properties on Schedule C. J.A. 213–14.

               That appeared to conclude the assignment process, but it wasn’t the end of the story.

                                                    B.

               Under the PSA, Liberty agreed to make annual payments to Shahabuddin at the end

        of fiscal years 2017, 2018, and 2019. Each annual payment would be 10 percent of “Net

        Revenue,” defined as “gross fees received less all discounts, Cash-in-a-Flash, Send-a-

        Friend, and uncollected fees for the offices in the Territories.” J.A. 402–03. 2 But when

        the time came to make the 2017 and 2018 payments, Liberty reneged.

               2
                 Cash-in-a-Flash and Send-a-Friend are incentive programs involving payments of
        $50 from the franchisee to the customer. Uncollected fees occur when a customer elects
        to pay for tax preparation services through a deduction from their refund, but the refund is
        then withheld by the IRS.

                                                     4
USCA4 Appeal: 21-2031        Doc: 38        Filed: 04/19/2023    Pg: 5 of 23

               Shahabuddin sued and the parties resolved his claims via a 2018 Settlement

        Agreement. Liberty agreed to pay Shahabuddin $775,000 to satisfy the missed payments

        and reaffirmed its commitment to pay 10 percent of Net Revenue for 2019. 3 The parties

        also agreed that the Settlement Agreement generally “supersede[d] their prior agreements,

        negotiations or understandings,” including the PSA. J.A. 420.

               But certain provisions of the PSA survived “in full force,” id., and those provisions

        sent mixed signals about whether Shahabuddin’s assignment obligations remained. On

        one hand, the Settlement Agreement preserved all of Section 8 of the PSA, which set out

        Shahabuddin’s “Representations and Warranties.” That included Subsection 8(e), which

        detailed Shahabuddin’s promise to assign leases at Liberty’s request alongside warranties

        that the leases were in full force and effect, clear of liens, and current on rent. But a

        standalone provision promising to assign the leases in Schedule C, Subsection 10(e), didn’t

        survive.

                                                    C.

               The renewed resolution was again short-lived. Before the 2019 payment, Liberty

        sent Shahabuddin a spreadsheet with Net Revenue calculations for the relevant locations.

        The spreadsheet contained a column for “Electronic Filing Fees,” amounting to $430,332.

        J.A. 228. These fees were included in the spreadsheet’s “Gross Fees” but were excluded

        from its “Net Revenue” figure. Id. Thus, the proposed final payment of $311,993 didn’t

        include 10 percent of these fees.

               3
                   The new agreement defined Net Revenue by reference to the PSA.

                                                     5
USCA4 Appeal: 21-2031      Doc: 38         Filed: 04/19/2023     Pg: 6 of 23

               Shahabuddin’s counsel objected via email to the deduction of “new items not

        previously contemplated between the parties.” J.A. 1059. Liberty’s representative replied,

        explaining that three of the contested items—Cash-in-a-Flash, Send-a-Friend, and

        “Refunds”—had been deducted in prior years, and noting that the PSA provided for Cash-

        in-a-Flash and Send-a-Friend deductions. J.A. 1058. Liberty’s response didn’t address the

        deduction for Electronic Filing Fees. Even so, Shahabuddin’s counsel provided wiring

        instructions “[b]ased on Liberty Tax’s representation that its calculation of Net Revenue is

        in accordance with the agreement between the parties,” and Liberty wired the funds. J.A.

        1055–58.

               Once again, though, that wasn’t the end of the story.

                                                    D.

               In December 2019—five months after Liberty made the final Net Revenue payment

        and three years after the initial period of lease assignment—Liberty requested leases for

        five properties still held by Shahabuddin. Three were properties listed in Schedule C that

        Liberty said it was “not taking” in the 2016 emails. The remaining two weren’t listed in

        Schedule C or mentioned in the emails.

               Each of the five properties had been occupied in the interim by a new Liberty

        franchisee who subleased the properties from Shahabuddin. It was the end of this new

        franchise relationship that prompted Liberty to seek assignment of these properties in

        December 2019.

                                                     6
USCA4 Appeal: 21-2031      Doc: 38         Filed: 04/19/2023     Pg: 7 of 23

               Shahabuddin refused to assign the leases, but he did enter temporary licensing

        agreements with Liberty, allowing Liberty to continue operating in the properties through

        the 2020 tax season. The licensing agreements were set to terminate on April 30, 2020.

                                                    E.

               Before the licensing agreements terminated, Liberty sued Shahabuddin in the

        Southern District of New York, alleging breach of contract, unjust enrichment, and breach

        of the implied covenant of good faith and fair dealing. Liberty sought damages and specific

        performance of the PSA, including assignment of leases for the five properties. And it

        moved for a temporary restraining order and preliminary injunction preventing

        Shahabuddin from interfering with its ability to do business at the five properties when the

        licensing agreements expired.

               After Shahabuddin invoked the forum-selection clauses in the PSA and Settlement

        Agreement, the district court transferred the case to the Eastern District of Virginia.

        Shahabuddin then filed an answer, a partial motion to dismiss, and counterclaims for

        tortious interference, defamation, and breach of contract (based on Liberty’s exclusion of

        Electronic Filing Fees from the 2019 Net Revenue payment). After briefing, the district

        court dismissed Liberty’s claim for unjust enrichment, denied its requests for injunctive

        relief, and dismissed Shahabuddin’s counterclaims for tortious interference and

        defamation.

               Both parties then moved for summary judgment on Liberty’s remaining claims, and

        Shahabuddin moved for summary judgment on his breach-of-contract counterclaim.

                                                     7
USCA4 Appeal: 21-2031        Doc: 38         Filed: 04/19/2023     Pg: 8 of 23

                 The district judge referred all motions to a magistrate judge, who held a hearing and

        issued a Report and Recommendation. Shahabuddin argued Liberty hadn’t established it

        requested assignment of the leases for the five properties in December 2019. But the

        magistrate judge determined that even if Liberty had requested the leases, it did so only

        after both expressly waiving its right to assignment and impliedly waiving that same right

        by waiting “an unreasonably long period” of time to make its request. JTH Tax, LLC v.

        Shahabuddin, No. 20-cv-217, 2021 WL 4352802, at *1 (E.D. Va. June 25, 2021), report

        and recommendation adopted, No. 20-cv-217, 2021 WL 3704726 (E.D. Va. Aug. 20,

        2021).

                 The magistrate judge next determined that “under the plain language of the parties’

        agreements,” Liberty had to pay Shahabuddin 10 percent of the 2019 Net Revenue,

        “including revenue received from Electronic Filing Fees.” Id. It recommended granting

        Shahabuddin’s motions for summary judgment on all claims and denying Liberty’s.

                 Liberty objected, arguing the magistrate judge misapplied the summary judgment

        standards, wrongly concluded Liberty waived its right to assignment under the PSA, and

        erred in determining there weren’t material issues of fact as to whether Shahabuddin had

        established his counterclaim for breach of contract. On the last point, Liberty raised—for

        the first time—the defense of accord and satisfaction.

                 The district judge adopted the magistrate judge’s determination in full, adding two

        “observations.” JTH Tax, 2021 WL 3704726, at *3. First, the court rejected Liberty’s

        argument that Liberty couldn’t have expressly waived its assignment right in the 2016

        emails because the 2018 Settlement Agreement “restated” and “reinforced” Shahabuddin’s

                                                       8
USCA4 Appeal: 21-2031      Doc: 38         Filed: 04/19/2023      Pg: 9 of 23

        “promise to assign the leases upon request.” J.A. 873–74. The court concluded that the

        Settlement Agreement didn’t create a “new contractual right[]” to assignment, and that it

        didn’t retroactively “shed light” on whether Liberty expressly waived its assignment rights

        in 2016. JTH Tax, 2021 WL 3704726, at *3.

               Second, the court rejected Liberty’s contention that it could retract its prior waiver

        because Shahabuddin hadn’t materially relied on it by the time Liberty requested

        assignment in 2019. It distinguished cases finding retraction of waiver in the context of

        ongoing obligations and the sale of goods, finding them inapplicable because the instant

        contract “contemplate[d] a discrete, one-time performance at a time close to [its]

        execution.” Id. at *3–4. The court didn’t address Liberty’s new defense of accord and

        satisfaction.

               This appeal followed.

                                                     II.

               We review a district court’s grant of summary judgment de novo. Calloway v.

        Lokey, 948 F.3d 194, 201 (4th Cir. 2020). We view the facts and draw all reasonable

        inferences in favor of the nonmoving party, Liberty. 4 Ga. Pac. Consumer Prods., LP v.

        Von Drehle Corp., 618 F.3d 441, 445 (4th Cir. 2010).

               Liberty doesn’t challenge the district court’s denial of its motion for summary
               4

        judgment.

                                                     9
USCA4 Appeal: 21-2031      Doc: 38          Filed: 04/19/2023     Pg: 10 of 23

               Our role isn’t to weigh the evidence or make credibility determinations, but to

        decide whether there is a genuine issue of material fact for trial. Anderson v. Liberty Lobby,

        Inc., 477 U.S. 242, 249, 255 (1986); PBM Prod., LLC v. Mead Johnson & Co., 639 F.3d

        111, 119 (4th Cir. 2011). A fact is “material” if “proof of its existence or non-existence

        would affect disposition of the case.” Wai Man Tom v. Hosp. Ventures LLC, 980 F.3d

        1027, 1037 (4th Cir. 2020). And a dispute is “genuine” if “the evidence offered is such

        that a reasonable jury might return a verdict for the non-movant.” Id. But a mere “scintilla

        of evidence” supporting the non-movant isn’t sufficient to defeat a motion for summary

        judgment. Anderson, 477 U.S. at 252.

               For Liberty’s claims against Shahabuddin, the issues are whether Liberty waived its

        right to assignment before it requested the leases for the five properties in December 2019,

        and if so, whether it later retracted that waiver. 5      The issues as to Shahabuddin’s

        counterclaim are whether he was entitled to a share of the Electronic Filing Fees and

        whether his claim is nonetheless barred by the defense of accord and satisfaction. We

        consider each in turn.

                                                     A.

               We begin with Liberty’s contention that the district court erred in holding Liberty

        waived its right to assignment.

               5
                We don’t consider Liberty’s argument that the magistrate judge erred in holding
        no reasonable jury could find Liberty demanded assignment of the disputed leases. Neither
        the magistrate judge nor the district court relied on that conclusion—both instead held that
        Liberty waived its assignment right before making any demand.

                                                     10
USCA4 Appeal: 21-2031          Doc: 38      Filed: 04/19/2023      Pg: 11 of 23

               Waiver is the voluntary, intentional abandonment of a known legal right.

        Bergmueller v. Minnick, 383 S.E.2d 722, 725 (Va. 1989). 6 It has two essential elements:

        (1) knowledge of the facts basic to the exercise of the right, and (2) the intent to relinquish

        the right. Id. A waiver may be express, or it may be implied through “conduct, acts, or a

        course of dealing.” Woodmen of World Life Ins. Soc’y v. Grant, 38 S.E.2d 450, 454 (Va.

        1946). The party relying on waiver has the burden to prove it by “clear, precise and

        unequivocal evidence.” Va. Polytechnic Inst. & State Univ. v. Interactive Return Serv.,

        Inc., 595 S.E.2d 1, 6 (Va. 2004).

               The district judge adopted and approved the magistrate judge’s conclusion that “the

        undisputed facts” established waiver “as a matter of law” on two alternative grounds: (1)

        that Liberty expressly waived its right to assignment of the five disputed leases in the 2016

        emails, and (2) that Liberty impliedly waived its right by “fail[ing] to request assignment

        of the leases until at least December of 2019.” JTH Tax, 2021 WL 3704726, at *2–3. We

        agree on both points. And we agree with the district court that retraction of waiver is

        inapplicable.

                                                      1.

               First, we conclude Liberty expressly waived its right to assignment of the leases for

        the five properties.

               6
                 The parties agree Virginia law applies, consistent with the choice-of-law clauses
        in the PSA and Settlement Agreement. See J.A. 411, 420.

                                                      11
USCA4 Appeal: 21-2031      Doc: 38         Filed: 04/19/2023     Pg: 12 of 23

               Three of the five properties at issue were on Schedule C of the PSA. The magistrate

        judge found (and the district judge agreed) that Liberty expressly waived its right to

        assignment for these three properties “when [it] repeatedly told Shahabuddin that [it] would

        not be taking them and replied affirmatively that he was free to dispose of such leases.”

        JTH Tax, 2021 WL 4352802, at *8.

               For the remaining two properties, the magistrate judge pointed to Shahabuddin’s

        counsel’s August 2016 email which sought to confirm that Liberty didn’t want any other

        properties that weren’t on Schedule C, such that Shahabuddin could “dispose of them.” Id.

        At the time, Liberty’s counsel replied that they were “not aware of any other leases Liberty

        wants to acquire,” but would confirm. J.A. 212. Despite continued communication with

        Shahabuddin about lease assignment over the following months, Liberty never followed

        up to request either property. The magistrate judge concluded that because Liberty “had

        already reiterated that Shahabuddin was free to dispose of leases [it chose] not to take,”

        this correspondence established waiver as to the remaining two properties. JTH Tax, 2021

        WL 4352802, at *8.

               Liberty argues the 2016 emails only show that it didn’t intend to take the leases for

        the five properties “at that time.” Appellants’ Br. at 23 (emphasis omitted). But that

        contention isn’t supported by the record. In emails, Shahabuddin’s counsel repeatedly

        asked whether he could “dispose of” the leases for properties Liberty wasn’t taking, and

        Liberty said yes. E.g., J.A. 197. Liberty’s responses contradict an expectation that

        Shahabuddin would hold the properties in case Liberty wanted them later. And Liberty’s

        counsel said it was in the parties’ interests to get assignments finalized “as quickly as

                                                    12
USCA4 Appeal: 21-2031      Doc: 38          Filed: 04/19/2023     Pg: 13 of 23

        possible”—a sentiment backed up by the flurry of emails in late 2016, followed by silence

        about assignment for the next three years. J.A. 212.

               Shahabuddin also submitted an affidavit from John Hewitt, Liberty’s co-founder

        and former CEO, who executed the PSA on Liberty’s behalf and had “personal knowledge

        of Liberty’s decision to take assignment or decline to take assignment of the leases

        associated with the franchises in the PSA.” J.A. 193. Hewitt stated that in 2016, Liberty

        determined that it didn’t want the “ongoing financial liability associated with” leases for

        the five properties. J.A. 194. And he explained that “[o]nce [Liberty] decided not to

        request assignment of the leases . . . it did not expect [] Shahabuddin to keep them available

        for assignment indefinitely.” Id.

               Hewitt also described the factors Liberty considered when determining whether to

        assume the leases of former franchisees: “the quality of the location, the recommendation

        of the leasing coordinator, relationship with the franchisee and the landlord, and whether

        assuming the lease payment obligations and liabilities made financial sense.” J.A. 193.

        This description matches the email exchanges from 2016, where Liberty’s counsel

        repeatedly referenced the leasing coordinator and requested Shahabuddin’s help working

        through issues with landlords.

               Finally, the PSA itself shows that assignment was to occur quickly. The agreement

        specified that Liberty would reimburse Shahabuddin for May rent at assigned properties.

        That payment was to be made July 1, 2016, “contingent on delivery of executed assignment

        documents by [Shahabuddin] of the Business leases, as requested by [Liberty].” J.A. 402–

        03. Liberty also agreed to pay June rent for assigned properties directly to landlords. And

                                                     13
USCA4 Appeal: 21-2031       Doc: 38         Filed: 04/19/2023      Pg: 14 of 23

        the PSA stated that its “Closing Date” would occur when Shahabuddin had delivered, and

        Liberty had accepted, “an executed copy of this Agreement and all of the Assets via a Bill

        of Sale and Assumption and Assignment forms.” J.A. 404 (emphasis added). That same

        provision gave Liberty the option to withdraw from the PSA if it wasn’t executed by June

        30, 2016.

               Each of these terms suggests the parties contemplated finalizing assignment

        decisions within a few months. They don’t support Liberty’s post-hoc contention that

        when it said it was “not taking” the leases for the five properties in late 2016, it only meant

        it wasn’t taking them “at that time.” Appellants’ Br. at 23.

               In attempting to show a dispute of fact as to its intent to waive assignment in 2016,

        Liberty relies primarily on the 2018 Settlement Agreement.            While that agreement

        generally superseded the PSA, it preserved Subsection 8(e), including Shahabuddin’s

        obligation to assign “any leases associated with the Business” to Liberty upon its request.

        See J.A. 405–06, 420. According to Liberty, “The parties would have had no need to

        reaffirm that provision of the PSA if Liberty had already waived its [assignment] rights.”

        Appellants’ Br. at 24.

               Shahabuddin counters that the parties kept 8(e) for its warranties that the “leases

        were valid, clear of liens, not in default,” and paid up on rent. Appellee’s Br. at 37; see

        also J.A. 405. And he points out that the Settlement Agreement “expressly superseded the

        most direct obligation in the PSA for Shahabuddin to assign leases to Liberty.” Appellee’s

        Br. at 37. That is, it didn’t preserve Subsection 10(e), the standalone provision promising

                                                      14
USCA4 Appeal: 21-2031      Doc: 38          Filed: 04/19/2023     Pg: 15 of 23

        to assign “the office real estate leases connected with the operation of the Business listed

        in Schedule C.” See J.A. 407, 420.

               The magistrate judge agreed with Shahabuddin that the Settlement Agreement

        didn’t create a dispute of material fact as to express waiver. Likewise, the district judge

        found that Liberty’s express waiver “was completed in 2016” and that “the Settlement

        Agreement, executed in 2018, does not shed light on whether” there was a waiver two years

        earlier. JTH Tax, 2021 WL 3704726, at *3.

               We agree that Liberty expressly waived its assignment rights as a matter of law.

        The 2016 emails show that Liberty both had “knowledge of” its right to assignment of the

        five properties and “inten[ded] to relinquish” that right. Bergmueller, 383 S.E.2d at 725.

        Liberty’s insistence otherwise is contradicted by its own statements at the time, the text of

        the PSA, and the uncontroverted affidavit from its then-CEO. 7 The district court thus

        correctly ruled that Liberty expressly waived its right to assignment of the five properties.

                                                     2.

               If not “express,” waiver may be “implied” through “conduct, acts, or a course of

        dealing.” Woodmen of World, 38 S.E.2d at 454. If we had any doubt that Liberty expressly

               7
                Liberty characterizes Hewitt as a disgruntled former CEO who was terminated by
        Liberty and now operates competing tax-preparation businesses at the five properties
        through a franchise relationship with Shahabuddin’s sister-in-law. But Liberty offers no
        evidence to contradict Hewitt’s affidavit on its terms. And even if Hewitt’s current
        business position were enough to create a dispute about his credibility, we’re satisfied that
        any such dispute wouldn’t be material given the other evidence of Liberty’s express waiver.

                                                     15
USCA4 Appeal: 21-2031      Doc: 38         Filed: 04/19/2023     Pg: 16 of 23

        waived its assignment right in the 2016 emails, we would still affirm because Liberty

        impliedly waived its right by waiting more than three years to request assignment.

               The closest issue as to express waiver concerns the two properties not on Schedule

        C.   These properties were addressed in the August 2016 email exchange, when

        Shahabuddin’s counsel directly asked whether he could “dispose of” the remaining

        properties not on Schedule C, and Liberty’s counsel stated they were “not aware of any

        other leases Liberty wants to acquire, but will confirm with our leasing team.” J.A. 212.

        Given that Liberty never followed up (at least before December 2019), we think this was

        likely an express waiver. But we address implied waiver for completeness.

               The magistrate judge concluded, and the district judge agreed, that even if the 2016

        emails didn’t constitute an express waiver, Liberty “subsequently waived any right to the

        [five properties] by failing to request assignment of the leases . . . within a reasonable

        time.” JTH Tax, 2021 WL 4352802, at *9. “When a contract is silent regarding the time

        of performance, the time of performance will be . . . a reasonable time after the execution

        of the agreement.” F.L. Hall, Inc. v. Warehouse Landing Assocs., 38 Va. Cir. 181, 1995

        WL 17044498, at *2 (1995). And “[i]n determining what is a reasonable time, the

        circumstances to be considered . . . include the nature of the proposed contract, the

        purposes of the parties, the course of dealing between them, and any relevant usages of

        trade.” Id. (cleaned up).

               The PSA doesn’t explicitly define the time for assignment, but as discussed above,

        all indications are that it was to occur within a matter of months. The purpose of the PSA

        was to transfer “assets, properties and rights used in connection with the Business” from

                                                    16
USCA4 Appeal: 21-2031       Doc: 38         Filed: 04/19/2023       Pg: 17 of 23

        Shahabuddin to Liberty when their franchise relationship ended. J.A. 402. The parties

        agreed that Liberty had the right to determine which properties it was interested in and to

        demand assignment over the following months. But they didn’t agree that Shahabuddin

        would hold the properties until such undefined future time as Liberty determined it was in

        its interest to take them.

               The contours of the assignment right are clear from the PSA’s terms, the 2016

        emails, and the Hewitt affidavit. They’re also apparent from Liberty’s failure to request

        assignment for more than three years after signing the PSA.

               Liberty argues that it didn’t take assignment of the five properties because it was

        able to find a new franchisee, who sublet the locations from Shahabuddin and operated

        Liberty franchises from 2016 to 2019. But the fact that Liberty found another franchisee

        doesn’t change that it didn’t want to take financial responsibility for the properties in 2016.

        For example, during the 2016 email exchanges, two of the properties were identified as

        having “tax issues.” J.A. 212. Liberty may have concluded those locations were more

        trouble than they were worth.

               For three years, Liberty had the best of both worlds: It reaped the benefits of having

        a franchisee in the properties while avoiding any of the risk or costs involved in assignment.

        While Liberty’s financial calculation may have changed when its new franchisee left in

        late 2019, by then it had waived its right to assignment.

               The magistrate judge correctly recognized these dynamics, concluding that by the

        time Liberty requested assignment in 2019, Shahabuddin “would have needed to otherwise

                                                      17
USCA4 Appeal: 21-2031      Doc: 38          Filed: 04/19/2023     Pg: 18 of 23

        dispose of the leases that [Liberty] w[as] not taking or risk financial loss by holding onto

        such leases indefinitely.” JTH Tax, 2021 WL4352802, at *11.

               The district judge agreed, and we do as well. And while the issue of what constitutes

        a reasonable time is usually for the jury, we agree that the three-year delay in this case was

        unreasonable as a matter of law. See id. at *9 (citing Grossmann v. Saunders, 376 S.E.2d

        66, 70 (Va. 1989) and Little v. Quin Rivers, Inc., No. 15-cv-20, 2015 WL 4363201, at *1

        (E.D. Va. July 14, 2015)).

                                                      3.

               Finally, we reject Liberty’s contention that it retracted any waiver when it demanded

        assignment of the five properties in 2019.

               Liberty admits that “Virginia case law does not address retraction of waiver” in this

        context. Appellants’ Br. at 36. But, it argues, we must predict what the Supreme Court of

        Virginia would do if faced with this issue. Liberty points to the Restatement (Second) of

        Contracts, a treatise, and cases from other states to argue that “retraction of waiver is a

        common-law principle applied routinely across many jurisdictions.” Id. at 39. It says

        there’s no reason to think that Virginia’s highest court wouldn’t apply it here.

               We disagree. To begin, we’ve already concluded that Liberty impliedly waived its

        assignment right when it failed to request assignment within a reasonable time. It wouldn’t

        make sense if Liberty’s implicit waiver could be retracted through the same (too late)

        request.

               Beyond that, none of Liberty’s sources persuade us that the Supreme Court of

        Virginia would apply retraction of waiver here.

                                                     18
USCA4 Appeal: 21-2031      Doc: 38         Filed: 04/19/2023     Pg: 19 of 23

               Liberty relies heavily on Municipal Authority of Westmoreland County v. CNX Gas

        Co., which involved an ongoing and continuous contractual relationship between a

        Pennsylvania municipality (the plaintiff) and those who had leased land from the county

        for oil and gas production (the defendants). 380 F. Supp. 3d 464, 466–67 (W.D. Pa. 2019).

        The lease agreement required the defendants to pay royalties, but permitted deduction of

        post-production costs, such as those required for processing, treatment, and transportation.

        Id. at 467. At first, however, the defendants paid royalties without deducting post-

        production costs. Id. at 467–68. When they later began deducting those costs, the plaintiff

        argued that the defendants had waived their contractual right to do so. Id. at 469.

               The court rejected the plaintiff’s argument. It determined that while the defendants

        had “impliedly waived their right to deduct post-production costs” when they didn’t do so,

        that waiver wasn’t “necessarily permanent.” Id. at 470 (emphasis omitted). And it found

        retraction of waiver was permissible because the county hadn’t established detrimental

        reliance; it was aware of and had budgeted for the later post-production deductions. Id. at

        471.

               We aren’t persuaded by Liberty’s reliance on Westmoreland County. To begin with,

        the case involves a Pennsylvania federal court applying Pennsylvania state law, which of

        course isn’t binding on Virginia courts. Second, the court emphasized that retraction of

        waiver is “particularly applicable when the contract in question has a recurring or periodic

        obligation.” Id. at 470 (emphasis added). But here, Shahabuddin had a one-time obligation

        to assign leases to Liberty at its request. Thus, even assuming the Supreme Court of

                                                    19
USCA4 Appeal: 21-2031      Doc: 38          Filed: 04/19/2023     Pg: 20 of 23

        Virginia would apply Westmoreland County, there’s no basis to think it would extend it to

        the facts here.

               Liberty also cites Bristol Metals, LLC v. Messer, LLC, 498 F. Supp. 3d 840 (E.D.

        Va. 2020). Like Westmoreland County, Bristol Metals involved a long-term commodities

        contract governed by Pennsylvania law. Id. at 845. At first, the plaintiff in Bristol Metals

        paid more than the contractual price cap, but like the defendants in Westmoreland County,

        it eventually sought to strictly enforce the contract’s terms. Id. at 845–46. On those facts,

        the district court found the plaintiff successfully retracted its waiver. Id. at 856–57. But

        after briefing here concluded, we reversed the relevant portion of Bristol Metals, finding

        no valid contract existed at the time the district court found retraction of waiver. Bristol

        Metals, LLC v. Messer, LLC, Nos. 21-1244, 21-1245, 2022 WL 17222216, at *5 (4th Cir.

        Nov. 23, 2022). So Bristol Metals doesn’t help Liberty.

               We also agree with the district court that none of the cases Liberty cites involved a

        situation “where one party purports, years later, to retract its waiver of a right pursuant to

        a contractual provision that contemplates a discrete, one-time performance at a time close

        to the execution of the contract.” 2021 WL 3704726, at *4. The closest candidate, Caro

        v. Hansen, involved a one-time obligation to transfer a security interest. 875 P.2d 512, 513

        (Or. Ct. App. 1994). But that obligation wasn’t conditional on the plaintiff’s request, and

        the gap between the contract execution and the plaintiff’s demand was less than one year.

        Id. at 513–14.

               While Liberty relies on cases from other jurisdictions, at least one decision from a

        Virginia trial court favors Shahabuddin.       In F.L. Hall, Inc. v. Warehouse Landing

                                                     20
USCA4 Appeal: 21-2031      Doc: 38          Filed: 04/19/2023     Pg: 21 of 23

        Associates, the court considered a contract giving the plaintiff-buyers the option to demand

        a refund (plus interest) from the defendant-seller if the defendant didn’t make agreed-upon

        improvements to several land parcels by a certain date. 38 Va. Cir. 181, 1995 WL

        17044498, at *1 (1995). The improvements were completed 10 months late, but the

        plaintiffs didn’t demand a refund for another 20 months, attempting to resell the properties

        in the meantime. Id. at *2.

               Under those circumstances, the court held that the plaintiffs had waived their right

        to demand a refund. Id. at *3. It described the plaintiffs as having sat on their right for

        years while speculating in the real estate market, knowing they faced little risk as they were

        accruing interest on any eventual refund. Id. And it concluded that granting specific

        performance to the plaintiffs so long after their rights became active would be inequitable.

        Id.

               The same is true here. Content to have its new franchisee operate with none of the

        risk associated with assignment, Liberty waited an unreasonable amount of time to request

        leases for the five properties. We don’t think the Supreme Court of Virginia would reward

        Liberty by recognizing retraction of waiver and we won’t do so here.

                                                     B.

               We next consider Liberty’s contention that the district court erred in finding

        Shahabuddin is entitled to 10 percent of the Electronic Filing Fees for fiscal year 2019.

               “Where the terms in a contract are clear and unambiguous, the contract is construed

        according to its plain meaning.” TM Delmarva Power, L.L.C. v. NCP of Va., L.L.C., 557

        S.E.2d 199, 200 (Va. 2002). We must “not insert by construction, for the benefit of a party,

                                                     21
USCA4 Appeal: 21-2031       Doc: 38         Filed: 04/19/2023      Pg: 22 of 23

        a term not express[ed] in the contract.” Lansdowne Dev. Co. v. Xerox Realty Corp., 514

        S.E.2d 157, 161 (Va. 1999).

               The district court correctly held that the definition of “Net Revenue” unambiguously

        included Electronic Filing Fees. In the 2018 Settlement Agreement, Liberty agreed to

        “make payment to Shahabuddin of 10% of the 2019 Net Revenue.” J.A. 419. The

        Settlement Agreement used the PSA’s definition of “Net Revenue”—“gross fees received

        less all discounts, Cash-in-a-Flash, Send-a-Friend, and uncollected fees for the offices in

        the Territories.” J.A. 402, 418. It didn’t allow for the deduction of Electronic Filing Fees. 8

               Liberty breached the Settlement Agreement when it did just that. The spreadsheet

        Liberty sent Shahabuddin before the 2019 payment included “Electronic Filing Fees” as

        part of the “Gross Fees” figure. J.A. 228. Liberty also admits the fees were “a revenue

        stream for Liberty Tax and its franchisees.” J.A. 989. But when Liberty calculated final

        Net Revenue for 2019, it deducted the fees. Id.

               To rule for Liberty, we would need to ignore the agreement’s plain text. Liberty

        says that it could properly deduct Electronic Filing Fees from Net Revenue because the

        former didn’t exist when the PSA was signed, and because the fees were generated by

        Liberty rather than its franchisees.   But neither the PSA nor the Settlement Agreement

        specifies that fees collected by Liberty in the first instance are excluded, and neither

        excludes fees for new products.

               8
                  If there were any doubt, Liberty’s Vice President of Treasury clarified in his
        deposition that Electronic Filing Fees are not “cash in a flash, send a friend or uncollected
        filing fees.” J.A. 1001.

                                                      22
USCA4 Appeal: 21-2031       Doc: 38          Filed: 04/19/2023      Pg: 23 of 23

               The parties’ agreement is unambiguous, and we decline to modify it after the fact

        for Liberty’s benefit.

               Nor will we consider Liberty’s argument that Shahabuddin’s counterclaim is barred

        by the affirmative defense of accord and satisfaction. Liberty raised this defense for the

        first time in its objections to the magistrate judge’s Report and Recommendation, and the

        district court judge had ample discretion not to consider it in that posture. Samples v.

        Ballard clarifies that a district court needn’t consider new issues raised for the first time in

        objections, even if it must consider new arguments related to existing issues. See 860 F.3d

        266, 271–273 (4th Cir. 2017) (discussing United States v. George, 971 F.2d 1113 (4th Cir.

        1992)). Samples also clarifies that an “issue” corresponds to a “ground for relief,” while

        an argument is a “position [] taken in support of or against” that ground. Id. at 273–74.

        We think an affirmative defense, like a “claim,” is best characterized as an issue rather than

        an argument.

                                                      III.

               In sum, Liberty waived its right to assignment of the five properties when it

        expressly declined to take the leases in 2016 and then waited three years to request

        assignment. Under the circumstances, retraction of waiver is inapplicable. Separately, the

        plain text of the parties’ agreement didn’t permit Liberty to deduct Electronic Filing Fees

        from the 2019 Net Revenue figure. The judgment of the district court is therefore

                                                                                          AFFIRMED.

                                                      23