Metz v. Bae Systems Technology Solutions and Services Inc.

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
STEPHEN D. METZ,
Plaintiff,
v. Civil Action No. 12-1694 (GK)
BAE SYSTEMS TECHNOLOGY
SOLUTIONS & SERVICES, INC.,
Defendant.
MEMORANDUM OPINION
Plaintiff Stephen D. Metz ( "Plaintiff 11 or "Metz 11 ) brings
this diversity action against Defendant BAE Systems Technology
Solutions & Services, Inc. ("Defendant 11 or "BAE 11 ) alleging
violations of the common law of the District of Columbia.
This matter is presently before the Court on Defendant's
Motion to Dismiss Plaintiff's Amended Complaint [Dkt. No. 13] .
Upon consideration of the Motion, Opposition [Dkt. No. 19],
Reply [Dkt. No. 20], and the entire record herein, and for the
reasons stated below, Defendant's Motion to Dismiss is granted.
1
I. BACKGROUND
BAE provides management and operational support to the
United States Armed Forces, Department of Defense, and other
federal agencies. Am. Compl. ~ 7. BAE is incorporated and has
its principal place of business in Maryland. Id. `` 5-6. Metz, a
Virginia resident, was employed at BAE as Vice President of
Maritime Programs from August 13, 2007, to February 3, 2012. Id.
`` 3, 8, 52.
On February 3, 2012, Metz was laid off. Id. ~52. Metz
signed a Waiver and Release Agreement with BAE that included a
Non-Compete Provision barring Metz for one year from working for
BAE' s competitors. Id. `` 2 0, 52. That Provision was effective
immediately and expired in February of 2013. Id. ~ 20.
Metz then applied for the position of Senior Vice President
and Group Manager of the Acquisition Program Management Group at
ALION, a company that had worked with BAE on several projects in
the past. Id. ``52-53, 58-59. ALION selected Metz to fill the
position, and he began working there on May 14, 2012, three
1
For purposes of ruling on a motion to dismiss, the factual
allegations of the complaint must be presumed to be true and
liberally construed in favor of the plaintiff. Aktieselskabet AF
21. November 2001 v. Fame Jeans Inc., 525 F.3d 8, 15 (D.C. Cir.
2008); Shear v. Nat'l Rifle Ass'n of Am., 606 F.2d 1251, 1253
(D.C. Cir. 1979). Therefore, the facts set forth herein are
taken from the Amended Complaint ("Am. Compl.") [Dkt. No. 9].
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months after he left BAE. Id. ~ 54. Metz's employment with ALION
was "on an at will basis." Id. ~ 55.
Shortly after being hired, Metz informed BAE employees that
he was now working for ALION. Id. ~ 57. In late May 2012, BAE
contacted Metz and ALION and "demand [ed] that ALION immediately
fire Plaintiff or that Plaintiff immediately resign" and
threatened legal action if neither of these events occurred. Id.~ 63, 67. The Amended Complaint alleges when Metz went to work
for ALI ON, ALI ON and BAE had been teammates and partners on a
number of projects and therefore, were not competitors and
would not be competitors during the duration of Metz's one year
non-competition agreement with BAE. On June 15, 2012, as a
direct consequence of BAE's actions, ALION terminated Metz. Id.~ 74.
On October 16, 2012, Metz filed a complaint in this Court.
On November 21, 2012, he filed an Amended Complaint. 2 On December
21, 2012, BAE filed a Motion to Dismiss Plaintiff's Amended
Complaint ("Motion") [Dkt. No. 13] On January 25, 2013, Metz
filed an Opposition to Defendant's Motion to Dismiss the Amended
Complaint ("Opposition") [Dkt. No. 19]. On February 8, 2013, BAE
2
In his Amended Complaint, Metz alleges several facts which are
completely opposite to those he alleged in his initial
complaint. Mot. at 17-18.
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filed a Reply in Support of Its Motion to Dismiss Plaintiffs'
Amended Complaint ("Reply") [Dkt. No. 2 0] .
II. STANDARD OF REVIEW
To survive a motion to dismiss under Rule 12(b) (6), a
plaintiff need only plead "enough facts to state a claim to
relief that is plausible on its face" and to "nudge [ [his or
her] claims across the line from conceivable to plausible." Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007). "[O]nce a
claim has been stated adequately, it may be supported by showing
any set of facts consistent with the allegations in the
complaint." Id. at 563.
Under the Twombly standard, a "court deciding a motion to
dismiss must not make any judgment about the probability of the
plaintiffs' success . [,] must assume all the allegations in
the complaint are true (even if doubtful in fact) [, and]
must give the plaintiff the benefit of all reasonable inferences
derived from the facts alleged." Aktieselskabet AF 21, 52 5 F. 3d
·at 17 (internal quotation marks and citations omitted) . A
complaint will not suffice, however, if it "tenders 'naked
assertion[s]' devoid of 'further factual enhancement.'" Ashcroft
v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Twombly, 550 U.S. at
557) (alteration in Iqbal).
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III. ANALYSIS
Metz has withdrawn Counts I and V of his Amended Complaint.
Opposition 2 n.1. Thus, the remaining claims are Counts II-IV,
all of which BAE argues must be dismissed. The Court addresses
each Count in turn.
A. Count II: Tortious Interference with Contract
In Count II, Metz alleges that BAE tortiously interfered
with his employment agreement with ALION and intentionally
procured the termination of that agreement through improper
means. Am. Compl. ~ 79. Metz acknowledges that his employment
agreement was "at will," but claims that, "under the
circumstances of this case," he "had a contract of employment
with ALION." Id.To state a claim for intentional interference with contract
under D.C. law, a plaintiff must allege: "(1) the existence of a
contract; (2) knowledge of the contract; (3) intentional
procurement of a breach of the contract; and (4) damages
resulting from the breach." Onyeoziri v. Spivak, 44 A.3d 279,
286 (D.C. 2012)
The District of Columbia Court of Appeals has made it clear
that an at-will employment agreement cannot be used as the basis
of a tortious interference with contract claim. McManus v. MCI
Commc'ns Corp., 748 A.2d 949, 957 (D.C. 2000) ("It is clear
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that, as an at-will employee, appellant did not have a
contractual employment relationship she could use as the basis
for a suit for tortious interference with a contractual
relationship.") (citing Bible Way Church v. Beards, 680 A.2d
419, 432-33 (D.C. 1996)); see also Riggs v. Home Builders Inst.,
203 F. Supp. 2d 1, 22-23 (D.D.C. 2002) (noting that plaintiff
could not bring an intentional interference with contract claim
based on an at-will employment agreement under D.C. law)
(citations omitted). The logic behind the court's conclusion was
that "if there is no fixed or assured employment there is
nothing tangible with which to interfere." Dale v. Thomason, 962
F. Supp. 181, 184 (D.D.C. 1997) (discussing Bible Way, 680 A.2d
at 432-33).
Even though Metz acknowledges that his employment agreement
with ALION was at-will, he states that "under the circumstances
of this case, Plaintiff had a contract of employment with
ALION." Am. Compl. ~ 79. However, Metz does not identify any
"circumstances" related to his agreement with ALION that would
indicate that this was "fixed or assured employment" or
othe,rwise more "tangible" than a standard at-will employment
agreement. Dale, 962 F. Supp. at 184.
Instead, Metz attempts to distinguish Bible Way and McManus
by arguing that the alleged "interferers" in those cases were
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not true third parties, but were fellow employees of the same
employer. Opposition 8-10. That is a distinction without a
difference. The defendant's status is irrelevant to the question
of whether an at-will employment agreement can constitute a
contract for purposes of a tortious interference with contract
claim. See Riggs, 203 F. Supp. 2d at 23 (rejecting attempt to
distinguish McManus and Bible Way and noting that uthe courts in
both cases . specifically focused on the plaintiffs' at-will
status in rejecting the tortious interference claims") (citing
McManus, 748 A.2d at 957-58; Bible Way, 680 A.2d at 432-33).
Metz's attempt to distinguish controlling precedent based on the
status of the alleged third party interferer is unpersuasive.
Therefore, Metz has failed to allege the existence of a
contract upon which his tortious interference with contract
claim can be based, and Count II shall accordingly be dismissed. 3
B. Count III: Tortious Interference with Prospective
Economic Advantage
In Count III, Metz alleges that BAE tortiously interfered
with his uvalid business or economic expectancy with ALION," and
intentionally induced or caused the termination of that
expectancy through improper means. Am. Compl. ~ 83. Again, the
3
BAE also argues, persuasively, that Metz has failed to allege
any facts demonstrating that BAE had any knowledge of some non-
at-will contract between Metz and ALION.
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basis for Metz's claim is his at-will employment agreement with
ALION.
To state a claim for intentional interference with
prospective economic advantage under D.C. law, a plaintiff must
allege: "(1) the existence of a valid business relationship or
expectancy between plaintiff and [ALION] ; (2) knowledge of the
relationship or expectancy on the part of the defendant; ( 3)
intentional interference inducing or causing a breach or
termination of the relationship or expectancy; and (4) resultant
damage." Sabre Int '1 Sec. v. Torres Advanced Enter. Solutions,
Inc., 857 F. Supp. 2d 97, 103 (D.D.C. 2012) (citing Bennett
Enters., Inc. v. Domino's Pizza, Inc., 45 F.3d 493, 499 (D.C.
Cir. 1995)).
In McManus, 748 A. 2d at 1957, the District of Columbia
Court of Appeals directly addressed the issue of whether it
would recognize a claim for intentional interference with
prospective economic advantage based on an at-will employment
agreement. The court ruled that it "never has held that an
employee can maintain a suit for interference with prospective
advantage where her expectancy was based on an at-will
relationship. 11
Significantly, the court said that "we do not do
so now," and that it was "not willing" to provide the employee
"contractual protections based on her alleged expectancy." Id.-8-
Based on this language in McManus, several other members of
this District Court have already concluded that the District of
Columbia Court of Appeals would not recognize a tortious
interference with prospective economic advantage claim based on
an at-will employment agreement. See Zelaya v. UNICCO Serv. Co.,
587 F. Supp. 2d 277, 287 (D.D.C. 2008); Houlahan v. World Wide
Ass'n of Specialty Programs & Sch., No. 04-01161, 2006 WL
785326, at *4 (D.D.C. March 28, 2006); Daisley v. Riggs Bank,
N.A., 372 F. Supp. 2d 61, 72-73 (D.D.C. 2005); Gross v. Davis,
No. 01-1486, 2003 U.S. Dist. LEXIS 3427, at *9-*10 (D.D.C. Mar.
3, 2003); Riggs, 203 F. Supp. 2d at 24-25.
In response, Plaintiff has presented a long and detailed
argument -- which is purely speculative -- that the District of
Columbia Court of Appeals would permit a third party
interference claim brought by an at-will employee. Plaintiff
cites extensive case law from other jurisdictions throughout the
country, including the Maryland courts, the Supreme Court, and
the Restatement (Second) of Torts in support of its position.
While this authority may be properly cited and is interesting to
be aware of, it certainly does not support Plaintiff's
prediction that the District of Columbia Court of Appeals would
recognize a cause of action for third party interference even
though that interference was based on at-will employment. The
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court's language makes it clear that not only was it not making
that ruling in McManus, but even emphasized that it "was
not willing to do [so] (emphasis added) . Id. Given that
emphatic language, this Court can certainly not reach the
conclusion that the District of Columbia Court of Appeals would
permit Plaintiff's third party interference claim based upon an
at-will contract to proceed in this case.
Plaintiff seems to be arguing that the wide acceptance in
the majority of jurisdictions, including the Supreme Court, of
third party interference claims based on at-will employment
virtually compels the District of Columbia Court of Appeals to
reach the conclusion it seeks when the appropriate issue
presents itself. That, of course, is not the case. The
District of Columbia Court of Appeals, as the highest State
court in the District of Columbia, is fully entitled to make its
own decision interpreting the substantive law in the District of
Columbia. 'It was given this opportunity in McManus, and
forcefully rejected it. 4
4
Plaintiff is correct that the Supreme Court did state in
Haddle v. Garrison, 525 U.S. 121, 126-27 (1998) that "the
sort of harm alleged by petitioner here essentially third
party interference with at-will relationships -- states a claim
for relief under § 1985(2). Such harm has long been a
compensable injury under tort law, and we see no reason to
ignore this tradition in this case. " However, the Court was
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In sum, this Court agrees with the cases already cited that
the District of Columbia Court of Appeals' language in McManus
leads to the conclusion that it would not recognize a tortious
interference with prospective economic advantage claim based on
Metz's at-will employment agreement with ALION, and, thus, Count
III shall be dismissed. 5
C. Count IV: Breach of the Implied Covenant of Good Faith
and Fair Dealing
Count IV alleges that BAE violated the implied covenant of
good faith and fair dealing when it ~did not conduct itself with
honesty in its enforcement of the non-compete agreement
with Plaintiff." Am. Compl. ~ 89.
The District of Columbia Court of Appeals has held that all
contracts contain an implied duty of good faith and fair
dealing, which means that ~neither party shall do anything which
will have the effect of destroying or injuring the right of the
other party to receive the fruits of the contract." Allworth v.
Howard Univ., 890 A.2d 194, 201 (D.C. 2006) (quoting Hais v.
Smith, 547 A.2d 986, 987 (D.C. 1988)). ~If the party to a
interpreting federal tort law, not ruling on the substance of
state law.
5
BAE again argues, persuasively, that Metz has failed to allege
any facts demonstrating that BAE had any knowledge of the
alleged business relationship or expectancy between Metz and
ALION.
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contract evades the spirit of the contract, willfully renders
imperfect performance, or interferes with performance by the
other party, he or she may be liable for breach of the implied
covenant of good faith and fair dealing. 11
Id. (citing Hais, 547
A.2d at 987-88).
In order to survive a motion to dismiss for breach of the
implied covenant of good faith and fair dealing, plaintiff must
allege facts to show that defendant "has taken steps, or refused
to take steps, which ultimately had the effect of destroying or
injuring the right to receive the fruits of the contract.,, Mero
v. City Segway Tours of Wash. D.C., L.L.C., 826 F. Supp. 2d 100,
106-07 (D.D.C. 2011) (quotation omitted).
The only contract that Metz has identified between the
parties which can form the basis for Metz's claim is the Waiver
and Settlement Agreement that he executed upon his termination
from BAE. See Robinson v. Deutsche Bank Nat. Trust Co., No. 12-
0732, 2013 WL 1191034, at *13 (D.D.C. Mar. 25, 2013) (noting
that under D.C. law, a "claim for breach of the implied covenant
of good faith and fair dealing cannot exist in the absence of a
contractual relationship 11
) (quoting Busby v. Capital One, N.A.,
772 F. Supp. 2d 268, 284 (D.D.C. 2011)). Metz must therefore
allege that BAE "has taken steps, or refused to take steps,
which ultimately had the effect of destroying or injuring the
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right to receive the fruits" he contracted to receive under the
Waiver and Settlement Agreement. Mere, 826 F. Supp. 2d at 106-
07.
Metz has made no such allegations. BAE correctly asserts
that the only "fruit" of the Waiver and Settlement Agreement to
which Metz is entitled is "Supplemental Severance Pay and
Benefits." Am. Compl. Ex. 1 ~ 3 (b) . 6 Metz does not allege how BAE
has, in any way, "taken steps, or refused to take steps, which
ultimately had the effect of destroying or injuring" his right
to receive those benefits.
Instead, Metz argues that BAE is interfering with his
obligation. to not seek employment with BAE' s competitors. Metz
insists that his agreement to not seek employment with BAE' s
competitors created an "implicit" right to the inverse the
ability to seek employment with any non-competitor of BAE.
Opposition 26.
This argument is not persuasive. "[I]mplied covenants are
disfavored," Amfac Resorts, L.L.C. v. Dep't of the Interior, 142
F. Supp. 2d 54, 73 (D.D.C. 2001), and the contract between Metz
and BAE contains no right to seek future employment with non-
6
The Court can consider documents attached as exhibits to the
Complaint when resolving a motion to dismiss. See Daniels v.
United States, No. 12-0485, 2013 WL 2352106, at *5 (D.D.C. May
30, 2013).
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competitors of BAE. It is clear that the non-compete provision
was something provided by Metz to BAE in exchange for
supplemental pay and benefits. Thus, it is not a ~fruit" of the
contract that entitles him to any particular benefit.
Because the ability to work for ALION or any other employer
is not a benefit provided to Metz under the agreement, BAE' s
alleged interference with that benefit cannot give rise to a
claim for breach of the implied covenant of good faith and fair
dealing. See Ihebereme v. Capital One, N.A., No. 10-1106, 2013
WL 1248240 I at *10 (D.D.C. Mar. 28, 2013) (noting that
~ [p] laintiffs were not entitled to interest payments under the
contract, so defendants could not have done anything to destroy
or injure the plaintiffs' right to receive them") (citing Paul
v. Howard Univ., 754 A.2d 297, 310 (D.C. 2000)); B&H Nat'l
Place, Inc. v. Beresford, 850 F. Supp. 2d 251, 260-61 (D.D.C.
2012) (dismissing claim for breach of implied covenant of good
faith and fair dealing where defendants ~simply had no duty
under the Covenants to disclose their business plans").
Therefore, Metz has failed to set forth a basic element of
a claim for breach of the implied covenant of good faith and
fair dealing, and, thus, Count IV shall be dismissed.
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IV. CONCLUSION
Upon consideration of the Motion, Opposition, Reply, and
the entire record herein, and for the reasons set forth in this
Memorandum Opinion, Defendant's Motion to Dismiss is granted. An
Order shall accompany this Memorandum Opinion.
September 30, 2013
{``Jihdb
Gladys KesOer' "----·
United States District Judge
Copies to: attorneys on record via ECF
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