Beach Tv Properties Inc. v. Soloman ( 2021 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
THE ATLANTA CHANNEL, INC., :
:
Plaintiff, : Civil Action No.: 15-1823 (RC)
:
v. : Re Document Nos.: 257, 261
:
HENRY A. SOLOMON, :
:
Defendant. :
MEMORANDUM OPINION
GRANTING IN PART AND DENYING IN PART PLAINTIFF’S MOTION IN LIMINE AND
GRANTING PLAINTIFF’S MOTION FOR PARTIAL SUMMARY JUDGMENT
I. INTRODUCTION
The parties in this long-running legal malpractice case have filed a series of motions in
anticipation of trial. Two are before the Court today. In one, Plaintiff Atlanta Channel, Inc.
(“ACI”) seeks to introduce lay opinion from a television industry businessperson. Defendant
Henry Solomon asserts that the opinion is inadmissible expert testimony. In the other motion,
ACI argues that it is entitled to partial summary judgment regarding the fees it paid an attorney
to appeal the unfavorable agency decision that resulted from Solomon’s malpractice. Solomon
opposes that motion too. Ultimately, the Court grants in part and denies in part ACI’s motion to
introduce the lay opinion and grants ACI’s motion for partial summary judgment.
II. BACKGROUND
ACI brought this malpractice lawsuit after its attorney, Solomon, filed an incomplete
license application on its behalf with the Federal Communications Commission (“FCC”). See
Second Am. Compl. ¶¶ 26–29, 73–79, ECF No. 69. Solomon’s mistake led to the FCC
dismissing ACI’s application, costing the company a Class A license for its low-power television
(“LPTV”) station. Settlement Agreement, ECF No. 263-2. A Class A license protects an LPTV
station against displacement from its assigned broadcast frequency by full-power television
stations. See Second Am. Compl. ¶¶ 19–20.
Solomon helped ACI administratively appeal the dismissal. See 1st Mac Naughton Decl.,
Exs. A–B, ECF No. 261-3. But after waiting over a decade to decide the appeal, the FCC
eventually denied it. Id. Ex. E, at 13–18. In the meantime, ACI had transferred its existing
LPTV license to Beach TV Properties. Second Am. Compl. ¶ 40. ACI and Beach TV are both
owned and operated by Jud Colley and Toni Davis. See 2d Colley Decl. ¶ 2, ECF No. 261-4.
Beach TV, describing itself as ACI’s “successor,” asked the FCC to reconsider the appeal denial.
See 1st Mac Naughton Decl., Ex. C. The FCC denied that request too. See id. Ex. E, at 21–29.
In a last-ditch effort to obtain the Class A license, Beach TV (noting that it was “formerly
known as” ACI) filed suit in the D.C. Circuit. See id. Ex. D. ACI’s lawyer in these proceedings,
W. James Mac Naughton, prosecuted the appeal. See 1st Mac Naughton Decl. ¶ 4. The D.C.
Circuit affirmed the FCC’s decisions in a short opinion. See Beach TV Props., Inc. v. FCC, 617
F. App’x 10 (D.C. Cir. 2015) (per curiam). It explained that it lacked jurisdiction to hear three of
Beach TV’s claims because Beach TV did not raise them “at any stage of the administrative
adjudication.” Id. at 10. Two other claims were untimely because Beach TV first raised them in
a motion for reconsideration. Id. And two claims were “not barred on appeal but lack[ed] merit”
because the FCC did not abuse its discretion by rejecting ACI’s license application based on a
“material deficiency” or by refusing to extend the deadline to submit the application. Id. at 11.
It is unnecessary to review the long and complicated procedural history of this case from
there. As things currently stand, the parties agree that Solomon is liable for malpractice. See
Settlement Agreement. The question remaining for trial is what damages Solomon owes ACI,
2
see Settlement Agreement—which once again holds the existing LPTV license, see 2d Mac
Naughton Decl., Ex. C, at 93:22–95:19, ECF No. 267-2. Before going to trial, however, ACI
makes two requests. First, it asks the Court to admit deposition testimony from Vince Castelli, a
businessperson in the television industry who approached ACI about buying an interest in a
permit for an LPTV station in Atlanta. See Pl.’s Mem. Law Supp. Mot. in Lim. for Admission of
Dep. Testimony of Vince Castelli (“Pl.’s Mot. in Lim.”), ECF No. 257-2. Second, ACI seeks
partial summary judgment to recoup attorneys’ fees that it paid Mac Naughton to press its appeal
at the D.C. Circuit. See Pl.’s Mem. Law Supp. Mot. for Partial Summ. J. in Amount of $28,703
(“Pl.’s Mot. Partial Summ. J.”), ECF No. 261-2. The Court addresses each request in turn.
III. ANALYSIS
A. Motion in Limine to Admit Castelli’s Deposition Testimony
ACI wants to introduce Castelli’s deposition testimony to help show what a Class A
license in Atlanta would have been worth. See Pl.’s Mot. in Lim. at 2. As mentioned, Castelli is
a businessman in the television industry. See Castelli Dep. at 4:20–21, ECF No. 258-1. Over
more than three decades in the industry, he has bought and sold numerous television stations.
See id. at 11:3–19. His company now owns forty stations across the country, including eight in
Atlanta. Id. at 4:22–5:10.
In April 2019, Castelli emailed Colley proposing that the two of them go into business
together. See id., Ex. 1. He offered Colley a 50% interest in a construction permit for a new
LPTV station at the price of $2.5 million. Id. A construction permit confers the right to build
transmission facilities, and it is the first step to obtaining a license to broadcast on a designated
frequency. Sloan Decl. ¶¶ 5–6, ECF No. 260-2. Castelli suggested that his company and ACI
would split the remaining costs of building and maintaining the station. Castelli Dep., Ex. 1. At
3
his deposition, he testified that the $2.5 million figure was half of his estimate that “the value of
the station would be at least $5 million as the time went on.” Id. at 8:20–21. He valued the
station based on a variety of factors, including the station’s location at the center of a major
market, upcoming changes in broadcasting standards, his view that displacement was unlikely,
and the expectation that cable providers would carry the station. Id. at 8:15–21, 26:11–24,
29:15–24. Castelli also estimated that the station would be worth two-and-a-half times as
much—or $12.5 million—if it had a Class A license. Id. at 9:20–24, 10:23–11:2.
ACI says that Castelli’s testimony about the value of his proposed station is admissible as
a lay opinion. See Pl.’s Mot. in Lim. at 3. A lay witness can offer an opinion only if it is “(a)
rationally based on the witness’s perception; (b) helpful to clearly understanding the witness’s
testimony or to determining a fact in issue; and (c) not based on scientific, technical, or other
specialized knowledge” that would make it expert testimony. Fed. R. Evid. 701. Solomon
argues that Castelli’s testimony flunks the third requirement. See generally Def.’s Opp’n Pl.’s
Mot. in Lim. for Admission of Dep. Testimony of Vince Castelli (“Def.’s Opp’n Mot. in Lim.”),
ECF No. 258. Unlike lay opinion testimony, expert testimony must satisfy certain reliability and
disclosure requirements. See United States v. Williams, 827 F.3d 1134, 1156 (D.C. Cir. 2016).
The line between the two kinds of testimony is a fine one. To discern one from the other,
“a court must focus on the reasoning process by which a witness reached his proffered opinion.”
Id. at 1160 (quoting United States v. Garcia, 413 F.3d 201, 215 (2d Cir. 2005)). In general
terms, “lay testimony ‘results from a process of reasoning familiar in everyday life,’ while expert
testimony ‘results from a process of reasoning which can be mastered only by specialists in the
field.’” Fed. R. Evid. 701 advisory committee’s note to 2000 amendment (quoting State v.
Brown, 836 S.W.2d 530, 549 (Tenn. 1992)); see also Williams, 827 F.3d at 1155. Each kind of
4
reasoning involves comparing a generalization or baseline to the specific facts of a case to draw
some conclusion. See Edward J. Imwinkelried, Distinguishing Lay from Expert Opinion: The
Need to Focus on the Epistemological Differences Between the Reasoning Processes Used by
Lay and Expert Witnesses, 68 SMU L. Rev. 73, 85–86 (2015). For example, both lay and expert
testimony identifying handwriting as belonging to someone would involve comparing a
generalization about the normal appearance of an author’s handwriting to the appearance of the
disputed handwriting. See id. But a lay opinion’s defining characteristic is that it “arise[s] from
the personal knowledge or firsthand perception of the witness.” Lord & Taylor, LLC v. White
Flint, L.P., 849 F.3d 567, 575 (4th Cir. 2017). A witness offering a lay opinion grounds his
baseline in personal experiences, then uses that baseline to evaluate an event that he personally
observed. See 1 McCormick on Evidence § 11 (8th ed. 2020). To continue the handwriting
example, a widow might rely on observations of her deceased husband’s handwriting to opine
that her husband was the author of a will she found in the days after his death. By contrast, an
expert can derive his baseline from specialized techniques or the research of others and then
assess an event at issue in a case even if he did not witness it. See id. An expert testifying in the
will dispute could draw on formal handwriting analysis techniques known only to professionals
in that field to opine about the author of the will regardless of whether he had any personal
connection to the case. The two forms of reasoning thus differ in two ways: (1) how the witness
establishes his baseline and (2) how the witness can learn about the facts of a case. See id.
A witness’s “[p]erceptions based on industry experience [are] a sufficient foundation for
lay opinion testimony.” United States v. Oldrock, 867 F.3d 934, 940 (8th Cir. 2017) (second
alteration in original) (emphasis omitted) (quoting US Salt, Inc. v. Broken Arrow, Inc., 563 F.3d
687, 690 (8th Cir. 2009)). Accordingly, one court in this district permitted pharmacists to testify
5
that they did not fulfill a doctor’s prescriptions because they were concerned that many of his
patients “presented the exact same prescriptions and travelled a far distance to get those
prescriptions.” United States v. Robinson, No. 16-cr-98, 2017 WL 11496737, at *1 (D.D.C. July
13, 2017). The court reasoned that the testimony was “not an expert opinion” because the
pharmacists’ concerns were “based on their day-to-day business experience as pharmacists.” Id.
at *2. That said, the court would not allow the pharmacists to offer “expert-type testimony” as to
whether the doctor “was acting outside the usual course of professional practice” or “what
constitutes standard medical practice.” Id. (internal quotation marks omitted).
Likewise, “most courts have permitted the owner or officer of a business to testify to the
value or projected profits of the business, without the necessity of qualifying the witness as an
accountant, appraiser, or similar expert.” Fed. R. Evid. 701 advisory committee’s note to 2000
amendment. “Such opinion testimony is admitted not because of experience, training or
specialized knowledge within the realm of an expert, but because of the particularized
knowledge that the witness has by virtue of his or her position in the business.” Id. The Fourth
Circuit, for instance, held that a company bookkeeper could provide lay opinion testimony about
projected lease-related profits “on the basis of records kept by her personally.” See MCI
Telecomm. Corp. v. Wanzer, 897 F.2d 703, 706 (4th Cir. 1990). Similarly, the Fifth Circuit
allowed a company’s president to estimate the profits it lost as a result of the breach of a
noncompetition agreement. See Merritt Hawkins & Assocs., L.L.C. v. Gresham, 861 F.3d 143,
153 (5th Cir. 2017).
Courts have also permitted businesspeople to offer lay opinions estimating the value of
their businesses’ assets, costs, and outputs. In one case, the Eleventh Circuit admitted lay
opinions from officers at a ship repair company regarding the reasonableness of the company’s
6
charges for repairing a ship because they “testified based upon their particularized knowledge
garnered from years of experience within the field.” See Tampa Bay Shipbuilding & Repair Co.
v. Cedar Shipping Co., 320 F.3d 1213, 1223 (11th Cir. 2003). In another case, the Fourth Circuit
permitted a department store executive to offer a lay opinion about what it would cost the store
to accommodate a mall’s redevelopment plan because he drew “on personal knowledge from . . .
on-the-job experience[,] including ‘relevant historical . . . facts’ regarding the more than 50
redesign projects he ha[d] overseen.” See Lord & Taylor, LLC, 849 F.3d at 575–76 (citation
omitted). And in another case, the Fifth Circuit let a company’s president testify as to the value
of missing computer files because he had personal knowledge about what it would cost to pay
employees to replace them. See Merritt Hawkins & Assocs., L.L.C., 861 F.3d at 153; see also id.
at 153–54 (permitting the president to testify about employee training expenses because
“[t]raining expenses for employees [we]re the sort of routine matters” within his personal
knowledge as the company’s president).
Castelli’s testimony estimating the value of his construction permit is equally admissible.
Lay reasoning underpinned his valuation. He relied on personal observations from more than
thirty years in the television industry to come up with baselines about what certain station
features were worth. Castelli then compared those baselines to his own station’s characteristics
to estimate the station’s value. It does not appear from his testimony that he used a methodology
or pricing model known only to television industry specialists. Because Castelli drew on his
personal experiences to price his station, he is like the ship repair company officers who
appraised the value of their company’s services based on their “years of experience,” the
executive who estimated the cost of a store redesign based on the projects he had overseen, or the
7
company president who testified about the worth of his company’s missing computer files based
on how much he knew he would have to pay employees to replace them.
Solomon offers four arguments to exclude Castelli’s testimony. The first three are
unpersuasive. The last one warrants excluding Castelli’s opinion that a station with a Class A
license is worth two-and-a-half times the value of a station without one. First, Solomon asserts
that, even if a businessperson can provide lay testimony about the value of his business, Castelli
cannot testify as to the value of a permit that allowed him merely to build a business. See Def.’s
Opp’n Mot. in Lim. at 9. But a construction permit is one of a television station’s core assets—it
is necessary to build transmission facilities and to obtain a license to broadcast from a designated
frequency. See Sloan Decl. ¶¶ 5–6. And as the cases described above illustrate, a
businessperson can supply lay testimony about the value of his business’s assets for the same
reason he can testify about the value of his business as a whole: he has personal knowledge of
the business’s workings. There is no logical difference between the two.
Second, Solomon argues that Castelli relied on specialized knowledge in valuing his
station. See Def.’s Opp’n Mot. in Lim. at 9–11. As evidence, Solomon cites Castelli attaching
to his email to Colley a map of the proposed station’s projected coverage and Castelli referring to
advances in broadcasting standards as one basis for his valuation. See id. Neither Castelli’s use
of the coverage map nor his knowledge of broadcasting standards signified that his testimony
depended on specialized expertise. Coverage maps are common in the television industry, and
their meaning is largely apparent to even a lay viewer. See 1st Colley Decl. ¶¶ 6–9, ECF No.
260-1; see also Castelli Dep., Ex. 1. Perhaps expert testimony would be necessary to explain
how to generate a coverage map, but Castelli only commissioned the map’s creation and
interpreted it to help value his station. How to interpret an already-generated coverage map is
8
the sort of skill that comes with experience in the industry; it does not require specialized
training or expertise. The same goes for changes in broadcasting standards. One would expect a
businessperson who operates forty television stations to be familiar with developments in
industry standards. Castelli did not need to draw on specialized knowledge to account for those
changes.
Third, Solomon attacks Castelli’s valuation for being a poor estimate of the proposed
station’s value. See Def.’s Opp’n Mot. in Lim. at 11–13. Solomon points out that Castelli’s $2.5
million figure was not an actual purchase price but rather an opening offer that Castelli admitted
was negotiable. See id. at 11–12; see also Castelli Dep. at 24:14–16. He also questions
Castelli’s assumption that cable providers would carry his proposed channel. See Def.’s Opp’n
Mot. in Lim. at 12–13; see also Castelli Dep. at 29:15–24. These qualms are relevant to the
weight of Castelli’s testimony, not its admissibility. They pertain to the substance of Castelli’s
analysis rather than his reasoning process. See Def.’s Opp’n Mot. in Lim. at 11 (“The Castelli
so-called offer to sell a half-interest in the unbuilt Channel 24 Construction Permit was merely
an opening bid or invitation to negotiate[] and is not probative of market value.” (underlining
omitted)). The latter is what distinguishes expert testimony from lay testimony. A jury can
decide the extent to which any logical shortcomings detract from Castelli’s testimony. Cf. Lord
& Taylor, LLC, 849 F.3d at 576 (rejecting arguments that a department store executive could not
offer a lay opinion about the costs of a store renovation because he visited the store only once
and had never estimated the costs of a renovation in Maryland, explaining that “those arguments
[went] to the weight to be given [the executive’s] testimony, not to its lay character or
admissibility”).
9
Lastly, Solomon asserts that Castelli cannot testify as to what his proposed channel would
have been worth if it had a Class A license. See Def.’s Opp’n Mot. in Lim. at 13–14. Solomon
says that answers to hypothetical questions or speculation about what a witness would have done
had a situation been different cannot satisfy the requirement that a lay opinion be rationally
based on the witness’s perception. Id. at 13 (citing Fed. R. Evid. 701(a)). That is an
oversimplification. To be sure, some courts have decried “speculative opinion testimony by lay
witnesses[,] i.e., testimony not based upon the witness’s perception.” Washington v. Dep’t of
Transp., 8 F.3d 296, 300 (5th Cir. 1993); see also United States v. Gibson, 636 F.2d 761, 764
(D.C. Cir. 1980) (“[W]e know of no case holding that a trial judge must permit a lay witness to
use one set of observations as the foundation for an opinion about what he might have seen under
different circumstances.”); Athridge v. Iglesias, No. 89-cv-1222, 2004 WL 7345458, at *2
(D.D.C. Dec. 21, 2004) (“Speculative testimony, based on what a witness would have done had
the situation been otherwise, cannot possibly be based on a witness’ perception.”). Those courts
excluded testimony about what a products liability plaintiff “would have done had he seen the
warning label” at the heart of his case, Washington, 8 F.3d at 300 (emphasis omitted), what a
witness who did not use binoculars “might have seen if he had used binoculars,” Gibson, 636
F.2d at 764, and whether a couple would have refused to let their nephew borrow their car “had
they been home on the day of the accident rather than on an extended vacation,” Athridge, 2004
WL 7345458, at *2.
But other courts have routinely permitted experienced professionals to offer lay opinion
testimony about what would have happened had some disputed fact been different. For instance,
several courts have allowed bank employees to offer lay opinions about what a bank would have
done had it known about misrepresentations in loan applications. See, e.g., Kerley, 784 F.3d at
10
339–40; United States v. Hill, 643 F.3d 807, 841–42 (11th Cir. 2011). Similarly, the Second
Circuit permitted accountants to provide lay opinions on how they would have accounted for
certain transactions had they known that the transactions were fraudulent. See United States v.
Cuti, 720 F.3d 453, 459–60 (2d Cir. 2013). And in another case, the Fourth Circuit approved a
lay opinion from a police officer who opined on the techniques and the degree of force he would
have used had he been the one to subdue an arrestee. See United States v. Perkins, 470 F.3d 150,
153, 156 (4th Cir. 2006). So it cannot be that witnesses are categorically barred from offering
lay opinion testimony about a counterfactual scenario. After all, hypothesizing about what could
have been is “a process of reasoning familiar in everyday life.” See Cuti, 720 F.3d at 460
(quoting Fed. R. Evid. 701 advisory committee’s note to 2000 amendment).
The distinction between the two strains of caselaw appears to be a difference in the
degree to which testimony is “rationally based on the witness’s perception.” See Fed. R. Evid.
701(a). Unadorned testimony about a hypothetical set of facts the witness did not observe is in
no way “based on the witness’s perception.” Indeed, such speculative testimony is often self-
serving and thus arguably unhelpful in “determining a fact in issue” too. See Fed. R. Evid.
701(b); see also Fed. R. Evid. 701 advisory committee’s note to 1972 proposed rules (“If . . .
attempts are made to introduce meaningless assertions which amount to little more than choosing
up sides, exclusion for lack of helpfulness is called for by the rule.”); Washington, 8 F.3d at 300
& n.10. By contrast, a witness whose testimony is grounded in extensive experience with a
business or industry can “rationally base[]” his prediction about a hypothetical scenario on that
personal experience. See Hill, 643 F.3d at 841–42 (rejecting an argument to exclude bank
employees’ lay testimony about what the banks would have done on the ground that “the ability
to answer hypothetical questions is the essential difference between expert and lay witnesses”
11
because the witnesses “based their testimony on their personal experiences as officers of
financial institutions with knowledge of their companies’ policies and of the specific transactions
at issue” (citation omitted)); see also United States v. Powers, 578 F. App’x 763, 772 (10th Cir.
2014) (rejecting, on plain-error review, defendant’s argument that lender witnesses who lacked
personal involvement in transactions could not answer hypothetical questions relating to the
transactions because their lay “testimony was based on their personal knowledge and experience
with their respective firms’ . . . policies and procedures”).
Castelli’s deposition testimony did not adequately establish that he had enough personal
experience with Class A licenses to opine on their value. No doubt, Castelli has extensive
industry experience. But with respect to Class A licenses specifically, he does not seem to have
the “particularized knowledge” that comes only from working with something day in and day
out. See Fed. R. Evid. 701 advisory committee’s note to 2000 amendment; cf. Lord & Taylor,
LLC, 849 F.3d at 575–76 (reasoning that a department store executive had “particularized
knowledge” of renovation costs based on his “day-to-day work” that included overseeing “more
than 50 redesign projects”); Kerley, 784 F.3d at 339–40 (permitting bank employees to opine on
the hypothetical application of banks’ “underwriting guidelines and policies” because they had
“particularized knowledge . . . acquired through their employment”). Just one of the forty
stations Castelli currently owns has a Class A license. Castelli Dep. at 5:18–6:2. And nothing in
his testimony indicates that any of the stations he has previously sold were Class A stations
either. In addition, ACI wants to admit Castelli’s deposition testimony; they do not seek to
preclear his live testimony. See Pl.’s Mot. in Lim. at 1. That restricts the Court’s ability to take
a generous view of admissibility on the ground that cross-examination could demonstrate the
weakness of the foundation supporting Castelli’s opinion. Cf. United States v. Williams, 212
12
F.3d 1305, 1309 n.6 (D.C. Cir. 2000) (explaining that a district court enjoys “broad discretion in
admitting opinion testimony of lay witnesses . . . due in large part to the opportunity the trial
judge ordinarily affords opposing counsel to expose a weak foundation through cross-
examination of the witness”). Given Castelli’s lack of experience with Class A licenses, his
opinion regarding their value is not rationally based on his perception and is therefore
inadmissible.
Because Castelli’s opinion about the value of his proposed station is based on his
experience as a businessperson in the television industry rather than technical or specialized
expertise, it is admissible as lay opinion. Nevertheless, Castelli has no particularized knowledge
of Class A licenses, so his opinion on the value of a Class A license will be excluded. ACI’s
motion in limine is thus granted in part and denied in part.
B. Motion for Partial Summary Judgment on Attorneys’ Fees for Appeal
ACI also requests summary judgment with respect to fees it paid its attorney to appeal the
FCC’s dismissal of its application to the D.C. Circuit. See Pl.’s Mot. Partial Summ. J. A party
deserves summary judgment only if it “shows that there is no genuine dispute as to any material
fact” and that it “is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). Material facts
are those that could affect the outcome of the litigation, and genuine disputes about material facts
exist when the evidence would allow a reasonable jury to return a verdict for the nonmovant.
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A court assessing a summary
judgment motion must avoid credibility determinations and draw all inferences in the
nonmovant’s favor. Id. at 255. But conclusory assertions without any evidentiary support do not
establish a genuine issue for trial. See Greene v. Dalton, 164 F.3d 671, 675 (D.C. Cir. 1999).
13
Damages in a malpractice suit include “attorney’s fees and costs expended as a result of
an attorney’s . . . malpractice.” See Knight v. Furlow, 553 A.2d 1232, 1235 (D.C. 1989); see
also Restatement (Third) of the Law Governing Lawyers § 53 cmt. f (Am. L. Inst. 2021) (“The
rule barring recovery of fees does not prevent a successful legal-malpractice plaintiff from
recovering as damages additional legal expenses reasonably incurred outside the malpractice
action itself as a result of a lawyer’s misconduct.”). For ACI to recover the fees it paid to appeal
the FCC’s dismissal to the D.C. Circuit, it must show that Solomon’s malpractice was a
proximate cause of the appeal. See Dalo v. Kivitz, 596 A.2d 35, 41 (D.C. 1991); see also Beach
TV Props., Inc. v. Solomon, 306 F. Supp. 3d 70, 96 (D.D.C. 2018) (“Triers of fact determine not
only whether a defendant’s negligence proximately caused damage to the plaintiff, but also the
extent of the plaintiff’s damage that the defendant proximately caused.”). That means that there
must be a “substantial and direct causal link” between Solomon’s malpractice and the appeal.
See Dalo, 596 A.2d at 42 (quoting District of Columbia v. Freeman, 477 A.2d 713, 716 (D.C.
1984)). If there is such a link, an intervening act would supersede Solomon’s malpractice and
relieve him of liability only if that act was not reasonably foreseeable. See id.According to ACI, there is no genuine dispute that Solomon’s malpractice proximately
caused it to pay its attorney to appeal the FCC decision. See Pl.’s Mot. Partial Summ. J. at 2–3.
Solomon responds with three counterarguments. As an initial matter, he asserts that ACI cannot
recover attorneys’ fees for an appeal that Beach TV—not ACI—commissioned. Def.’s Opp’n
Pl.’s Mot. Partial Summ. J. on Damages (“Def.’s Opp’n Mot. Partial Summ. J.”) at 6, ECF No.
263. Solomon then argues that his misconduct was not a proximate cause of the appeal. He says
that Beach TV chose to appeal only after the Spectrum Act’s passage in 2012 raised the
14
possibility of receiving “a huge financial windfall.” Id. at 5. Finally, Solomon concludes by off-
handedly questioning whether the appeal to the D.C. Circuit was “worth the candle.” Id. at 6.
No reasonable jury could side with Solomon. For starters, ACI can properly seek
attorneys’ fees for the failed appeal to the D.C. Circuit. ACI submitted two different tax forms
from 2015 showing that it was the one that paid Mac Naughton to appeal the case. See 1st Mac
Naughton Decl., Ex. H (miscellaneous income form for the appellate attorney listing the payer as
ACI); 3d Colley Decl., Ex. B, ECF No. 267-1 (redacted excerpt from ACI’s tax return listing a
figure for legal and professional expenses that Colley states includes the amount paid to the
appellate attorney, 3d Colley Decl. ¶ 9). In response, Solomon makes much of the fact that
Beach TV pays some of ACI’s expenses—including legal fees—and then accounts for those
transactions with mere “journal entries” on both companies’ books rather than writing checks
between the companies. See Def.’s Opp’n Mot. Partial Summ. J. at 6; see also, e.g., Colley Dep.
at 105:1–8, 116:2–22, 161:11–162:16, ECF No. 263-3. He also points out that Mac Naughton
addressed his invoice to Beach TV. See Def.’s Opp’n Mot. Partial Summ. J. at 6; see also 1st
Mac Naughton Decl., Ex. G.
But Solomon’s argument is too clever by half. Earlier in this litigation, Solomon had
Beach TV dismissed from the suit because ACI could not assign Beach TV the right to pursue
the malpractice claim. See Beach TV Props., Inc. v. Solomon, No. 15-cv-1823, 2016 WL
6068806, at *15–17 (D.D.C. Oct. 14, 2016). He now wants to avoid paying appellate fees
because ACI—not Beach TV—is asking for them. To make matters worse, he grounds his trap
in an accounting technicality with little practical significance. Colley and Davis own both ACI
and Beach TV. See 2d Colley Decl. ¶ 2. And even Solomon testified that, when Beach TV
transferred the existing LPTV license back to ACI, there was essentially “no change in
15
ownership . . . and no change in control” because Colley and Davis owned and controlled both
companies. 2d Mac Naughton Decl., Ex. C, at 93:22–95:19. It is thus unclear how a payment
from Beach TV that is reimbursed with a transfer recorded in both ACI’s and Beach TV’s books
is meaningfully different than ACI making that payment directly. Most importantly, even if
Beach TV covers ACI’s expenses from time to time, the evidence indicates that ACI paid Mac
Naughton in this instance. Solomon does not grapple with that evidence by offering contrary
evidence of his own. See Fed. R. Civ. P. 56(c)(1) (requiring a party asserting that a fact is
genuinely disputed to “cit[e] to particular parts of materials in the record”). Indeed, given
Colley’s oftentimes uncertain testimony regarding the relationship between ACI and Beach TV’s
finances, see, e.g., Colley Dep. at 108:3–22, 116:16–18, it is striking that Solomon did not
depose the bookkeeper whom Colley described as “the only person” who knew the details of
transactions between the companies, e.g., id. at 162:17–19. A jury could not reasonably
determine that ACI did not fund the D.C. Circuit appeal.
Next, Solomon’s misconduct was undisputedly a proximate cause of the appeal to the
D.C. Circuit. His misfiling of ACI’s license application certainly “play[ed] a central role” and
was a “substantial factor” in ACI incurring the expense of the appeal. See Dalo, 596 A.2d at 41–
42 (quoting Freeman, 477 A.2d at 715–16). Solomon nevertheless asserts that the Spectrum
Act’s passage in 2012 cut off the causal connection his malpractice had with the decision to
appeal. See Def.’s Opp’n Mot. Partial Summ. J. at 5. As explained in a previous opinion, the
Spectrum Act allows the federal government to relicense Class A television stations’ broadcast
frequencies to wireless communication companies by acquiring the Class A licenses in a reverse
auction. See Atlanta Channel, Inc. v. Solomon, No. 15-cv-1823, 2020 WL 7013346, at *2
(D.D.C. Nov. 24, 2020). LPTV stations without a Class A license “cannot participate in the
16
reverse auction . . . and risk going off the air if the available spectrum is taken by wireless
carriers or broadcast stations with priority.” Id. Solomon suggests that Beach TV decided to
appeal the application dismissal because it wanted the “huge financial windfall” that could result
from the reverse auction. See Def.’s Opp’n Mot. Partial Summ. J. at 5. He adds that this Court
has already ruled that the foreseeability of the Spectrum Act’s passage for purposes of damages
calculations is a genuinely disputed issue of material fact. See id.; see also Beach TV Props.,
Inc., 306 F. Supp. 3d at 96–97.
But the relevant question for the superseding cause analysis here is whether the D.C.
Circuit appeal was foreseeable at the time of Solomon’s malpractice, not whether the Spectrum
Act’s passage was. That is because the damages ACI requests in its pending summary judgment
motion consist only of the fees it paid to appeal the case rather than the economic damages
potentially attributable to ACI’s lack of a Class A license under the Spectrum Act’s reverse
auction scheme. See Dalo, 596 A.2d at 42 (“A defendant ‘will be held responsible for the
damages which result despite the entry of another act in the chain of causation’ if that subsequent
act reasonably could have ‘been anticipated and protected against.’” (citation omitted)). And
ACI’s decision to take on the costs of an appeal to the D.C. Circuit was foreseeable when
Solomon submitted the incomplete license application. In the immediate aftermath of the
application’s dismissal, Solomon emailed Colley about how the appeals process would work.
See Def.’s Opp’n Mot. Partial Summ. J., Ex. 4, ECF No. 263-5. Solomon explained that the
FCC would hear a first-round appeal and any unfavorable decision would be appealable to a U.S.
Court of Appeals. Id. Colley responded that he wanted “to pursue all avenues of relief” because
“protected frequency in Atlanta could be worth a substantial amount of money.” 3d Colley
Decl., Ex. A (emphasis added). So notwithstanding the Spectrum Act later heightening the
17
stakes, it was always foreseeable that ACI would incur the cost of appealing the FCC decision to
the D.C. Circuit. The Spectrum Act’s passage was not a superseding cause of the appeal.
Solomon lastly asserts that there is a genuine dispute about whether the decision to appeal
to the D.C. Circuit was “worth the candle.” Def.’s Opp’n Mot. Partial Summ. J. at 1, 6. The
“worth the candle” phrase refers to Solomon’s assessment following the application’s dismissal
that the low chances of a successful appeal did not justify the costs. See id. Ex. 4. But he cites
no authority for the proposition that a legal malpractice plaintiff cannot recover attorneys’ fees
incurred to pursue appeals that the defendant attorney judged to be financially unwise. On the
contrary, a malpractice plaintiff can “recover the expenses of a proper effort to mitigate damages
even though it proves unsuccessful.” See Baker v. Dorfman, 239 F.3d 415, 427 (2d Cir. 2000)
(brackets omitted) (quoting Den Norske Ameriekalinje Actiesselskabet v. Sun Printing &
Publishing Ass’n, 122 N.E. 463, 465 (N.Y. 1919)). Nowhere does Solomon argue that the D.C.
Circuit appeal was somehow improper or frivolous. In fact, he told Colley after the application’s
dismissal that he would be “glad” to appeal if Colley thought it was worth the cost. See Def.’s
Opp’n Mot. Partial Summ. J., Ex. 4. The D.C. Circuit did not describe the appeal as frivolous
either. See generally Beach TV Props., Inc., 617 F. App’x 10.
Solomon appears to argue that ACI had a duty to mitigate damages by not appealing the
case. See Def.’s Opp’n Mot. Partial Summ. J. at 3. “The avoidable consequences doctrine is that
‘one injured by the tort of another is not entitled to recover damages for any harm that he could
have avoided by the use of reasonable effort . . . .’” See Flowers v. District of Columbia, 478
A.2d 1073, 1077 (D.C. 1984) (omission in original) (quoting Restatement (Second) of Torts
§ 918 (Am. L. Inst. 1979)); see also Restatement (Third) of the Law Governing Lawyers § 54
cmt. e (“To the extent that applicable law recognizes them in other negligence actions, the partial
18
defense of failure to mitigate damages and the defense of assumption of the risk apply to legal-
malpractice claims.”). Solomon seemingly thinks that the low likelihood of the appeal’s success
would have made it reasonable for ACI to abstain from appealing to minimize the costs he would
have to repay it. Even if that is true, however, the decision to appeal was also reasonable.
Colley believed that a Class A license “could be worth a substantial amount of money.” 3d
Colley Decl., Ex. A. Exhausting the right of appellate review was a reasonable way to mitigate
the significant damages that could flow from failing to obtain that license. And because
Solomon created the predicament, he does not get to second-guess the decision to appeal:
Where a choice has been required between two reasonable courses, the person
whose wrong forced the choice can not complain that one rather than the other
was chosen. The rule of mitigation of damages may not be invoked by a contract
breaker as a basis for hypercritical examination of the conduct of the injured
party, or merely for the purpose of showing that the injured person might have
taken steps which seemed wiser or would have been more advantageous to the
defaulter.
Dist. Concrete Co. v. Bernstein Concrete Corp., 418 A.2d 1030, 1037 (D.C. 1980) (quoting In re
Kellett Aircraft Corp., 186 F.2d 197, 198 (3d Cir. 1950)).
Accordingly, ACI can recover the fees it paid to appeal to the D.C. Circuit.
IV. CONCLUSION
For the foregoing reasons, ACI’s motion in limine to admit Castelli’s deposition
testimony (ECF No. 257) is GRANTED IN PART AND DENIED IN PART and ACI’s
motion for partial summary judgment on the issue of the fees it paid to prosecute its D.C. Circuit
appeal (ECF No. 261) is GRANTED. An order consistent with this Memorandum Opinion is
separately and contemporaneously issued.
Dated: September 17, 2021 RUDOLPH CONTRERAS
United States District Judge
19