Brunson v. Kalil & Co., Inc.

• Decision Date: 18 November 2005
• Docket Number: No. Civ.A. 04-1828(CKK).,Civ.A. 04-1828(CKK).
• Citation: 404 F.Supp.2d 221
• Parties: Dorothy E. BRUNSON, Plaintiff, v. KALIL & COMPANY, INC., and Brunson Communications, Inc., Defendants.
• Court: U.S. District Court — District of Columbia

404 F.Supp.2d 221

Dorothy E. BRUNSON, Plaintiff, v. KALIL & COMPANY, INC., and Brunson Communications, Inc., Defendants.

No. Civ.A. 04-1828(CKK).

United States District Court, District of Columbia.

November 18, 2005.

COPYRIGHT MATERIAL OMITTED

Kenneth A. Martin, Martin & Associates P.L.L.C., Washington, DC, for Plaintiff.

Edward J. Longosz, II, Mark Andrew Johnston, Eckert, Seamans, Cherin & Mellott, LLC, Washington, DC, for Defendants.

MEMORANDUM OPINION

KOLLAR-KOTELLY, District Judge.

Plaintiff Dorothy Brunson brings this action against Defendants Kalil & Company, Inc. ("Kalil") and Brunson Communications, Inc. ("BCI"). Plaintiff is seeking a declaratory judgment from this Court that neither Plaintiff nor BCI owe Kalil any funds under a Brokerage Agreement dated November 6, 2003, and signed by Plaintiff on November 21, 2003. Defendant Kalil moves to dismiss Plaintiff's Complaint (1) for lack of personal jurisdiction under Federal Rule of Civil Procedure 12(b)(2) and (2) because Plaintiff is the improper plaintiff before this Court, having misused the Declaratory Judgment Act. Based on the reasoning set forth below, this Court shall grant Defendant Kalil's motion to dismiss for lack of personal jurisdiction.

I: BACKGROUND¹

Plaintiff is an individual residing in Maryland, who until October 1, 2004, was the sole shareholder of BCI. Am. Compl. ¶¶ 1, 5; Pl.'s Opp'n to Def.'s Mot. to Dismiss ("Pl.'s Opp'n") at 1; Pl.'s Opp'n, Ex. 1 (Decl. of Dorothy E. Brunson ("Brunson Decl.")), ¶¶ 1, 2. At times relevant to this suit, BCI was a New York corporation that operated the television station WGTW and the digital television station WGTW-DT (collectively "the Station"). Am. Compl. ¶ 3; Brunson Decl. ¶ 3. The Federal Communications Commission ("FCC") had licensed the Station to the community of Burlington, New Jersey. Am. Compl. ¶ 3. The Station's studios and operating equipment were located in Philadelphia, Pennsylvania. Am. Compl. ¶ 3; Brunson Decl. ¶ 3.

In 2002 and 2003 several offers had been made to BCI to buy the Station. Am. Compl. ¶ 6. In 2003, Kalil, an Arizona corporation with its principal place of business in Tucson, Arizona, became aware that BCI was considering a sale of the Station and sought an exclusive brokerage agreement with BCI regarding the sale of the Station. Am. Compl. ¶ 2, 7; Def.'s Mem. of P. & A. in Supp. of Def.'s Mot. to Dismiss ("Def.'s Mem."), Ex. 1 ("Frank Kalil Aff."), ¶ 2. On November 21, 2003, Plaintiff, in her capacity as BCI President signed the Brokerage Agreement dated November 6, 2003, making Kalil BCI's exclusive broker in the search for a qualified and satisfactory buyer for the Station. Frank Kalil Aff, Ex. A (Brokerage Agreement). By its explicit terms, the Brokerage Agreement expired on January 21, 2004, "except as to (i) any agreement with a prospective buyer introduced to you by us that is being negotiated or is pending closing, or (ii) any one whom we introduce to you, and with whom you enter into an agreement on or before June 30, 2004." Id. At this same time, Ms. Brunson retained counsel located in the District of Columbia to represent BCI "in all matters related to the Brokerage Agreement and sale of BCI." Brunson Decl. ¶ 5.

Over the course of its search for a buyer, Kalil provided Plaintiff with regular updates of its activities. Brunson Decl. ¶ 7. One such update, dated April 16, 2004, listed Fox Television Stations, Inc., as one of the prospective clients listed. Pl.'s Opp'n, Ex. 2 (Apr. 16, 2004 Update) at 6. Kalil had contacted Fox at its offices in Washington D.C. Id. The April 16, 2004 Update lists only one contact with Fox. Id. The April 16, 2004 Update also listed Trinity Christian Center of Santa, Ana, Inc. ("Trinity") as a prospective client. Id. at 7. Trinity is a non-profit church corporation organized under the laws of California. Am. Compl. ¶ 5. In contrast with Fox, the contacts listed with Trinity were many, and the notes extensive; culminating on April 16, 2004, with Kalil sending Trinity a revised Letter of Intent. Id. However, as of June 30, 2004, Kalil had not found an appropriate buyer for the Station. Am. Compl. ¶ 13. On or about August 2, 2004, Plaintiff entered into a stock purchase agreement ("Purchase Agreement"), dated July 30, 2004, with Trinity. Am. Compl. ¶ 14. The Purchase Agreement closing occurred on October 1, 2004, in Washington, D.C., in accordance with a provision in the Purchase Agreement calling for the closing to occur at BCI's office in Philadelphia "or at such other time or place as [Trinity] and [Plaintiff] shall mutually agree in writing." Am. Compl. ¶ 15; Def.'s Mem., Ex. 2, § 2 (Purchase Agreement). Kalil was not a party to the Purchase Agreement and was not invited to attend the closing. Frank Kalil Aff., ¶ 16; Def.'s Mem., Ex. 2 (Purchase Agreement); Pl.'s Opp'n, Ex. 3 (Decl. of Barry Wood ("Wood Decl. I")), ¶ 14.

Prior to the closing, Kelly Callan, a Kalil employee, phoned Barry Wood, BCI's long-time attorney who handled the negotiation and finalization of the Purchase Agreement. Wood Decl. I ¶¶ 4, 9, 11. Mr. Wood is the president of Wood, Maine & Brown, Chartered, a District of Columbia professional corporation with its main office located at 1827 Jefferson Place, NW, Washington, D.C. Wood Decl. I ¶ 1. Pursuant to their conversation in which Mr. Wood informed Mr. Callan that he had no invoice on which to determine what Kalil might be owed as a result of the Purchase Agreement, Mr. Callan faxed Mr. Wood an invoice for $960,000. Wood Decl. I ¶¶ 11, 12. Mr. Wood subsequently requested from Mr. Callan the document that had formed the basis for the invoice. Wood Decl. I ¶ 13. In response, on September 29, 2004, Mr. Callan faxed Mr. Wood the Brokerage Agreement. Wood Decl. I ¶ 13. A number of communications between Mr. Wood, Frank Kalil, President of Kalil, and Tim Ryan, Kalil's attorney, followed. Mr. Ryan's office was located in Pittsburgh, Pennsylvania. Def.'s Reply, Ex. 4 (Decl. of Timothy P. Ryan ("Ryan Decl.")), ¶ 1. Most importantly:

• October 4, 2004 — Mr. Kalil faxed a letter to the Station for the Plaintiff advancing a settlement offer that was to expire on October 5, 2004 at 5:00 p.m. Wood Decl. I ¶ 20.

• October 5, 2005 — Mr. Ryan faxed Mr. Wood a letter indicating Kalil's intent to sue "[u]nless the full amount owed by Brunson is immediately paid over to Kalil." Wood Decl. I ¶ 21; Ryan Decl. ¶ 5; Ryan Decl., Ex. A (Letter from Mr. Ryan to Mr. Wood).

• October 6, 2004 — Mr. Ryan called Mr. Wood in order to discuss the letter he had sent the previous day and to discuss the possibility of resolving the matter without resorting to litigation. Mr. Wood did not take the call. Ryan Decl. ¶ 6. Later that day, at 10:30 p.m. Mr. Wood returned Mr. Ryan's phone call and left a message indicating that Plaintiff and BCI were interested in settling the matter fairly and reasonably. Ryan Decl. ¶ 7; Ryan Decl., Ex. B (transcribed message).

• October 7, 2004 — Mr. Ryan faxed Mr. Wood a copy of the letter Mr. Ryan had sent to Trinity's attorney demanding payment of Kalil's commission. Mr. Wood attempted to contact Mr. Ryan twice to discuss the October 7, 2004 letter, but Mr. Ryan did not take the calls. Wood Decl. I ¶ 22.

• October 13, 2004 — Mr. Wood left a message for Mr. Ryan stating that the next day a letter would be sent including Plaintiff's and BCI's position. Ryan Decl. ¶ 9.

• October 15, 2004 — Mr. Wood faxed the settlement letter to Mr. Ryan. The letter requested an opportunity for Mr. Wood, Mr. Ryan, and Trinity's lawyer to meet and try to resolve the matter. Wood Decl. I ¶ 22; Ryan Decl. ¶ 10; Ryan Decl., Ex. C (Letter from Mr. Wood to Mr. Ryan). Later that day, Mr. Wood, Mr. Ryan, and Trinity's attorney had a conversation in which Mr. Ryan renewed his October 4, 2004 offer to which Mr. Wood made a counteroffer. Wood Decl. I ¶ 23; Ryan Decl. ¶ 11.

• October 20, 2004 — Mr. Wood called Mr. Ryan in order to pursue the counteroffer he made in the October 15, 2004 conversation. Wood Decl. I ¶ 23. Mr. Wood and Mr. Ryan discussed the possibility of Plaintiff and Mr. Kalil speaking directly regarding the settlement. Ryan Decl. ¶ 12; Pl.'s Surrepy [sic] ("Pl.'s Surreply"), Ex. 1 (Decl. of Barry Wood ("Wood Decl. II")), ¶ 7. Mr. Wood confirmed this conversation in an email to Mr. Ryan later in the day on October 20, 2004. Ryan Decl. ¶ 13; Ryan Decl., Ex. D (Wood Email).

• October 28, 2004 — Mr. Wood called Mr. Ryan and left a message. Wood Decl. I ¶ 25; Wood Decl. II ¶ 3; Ryan Decl. ¶ 15.

• November 1, 2004 — Mr. Ryan returned Mr. Wood's October 28 phone call and they spoke about Plaintiff's decision not to talk directly to Mr. Kalil. Mr. Wood also reiterated Plaintiff's previously stated position. Ryan Decl. ¶ 16; Wood Decl. II ¶ 4.

Mr. Ryan also stated in his Declaration that he did not become aware that Plaintiff filed suit in this Court until November 9, 2004. Ryan Decl. ¶ 18. Plaintiff had in fact filed the action on or about October 21, 2004. Ryan Decl. ¶¶ 14, 18; Compl. at 9 (giving the date of the original Complaint as October 20, 2004). On November 29, 2004, Kalil filed suit against BCI, Plaintiff, and Trinity in the United States District Court for the District of Arizona. Def.'s Mem. at 3; Frank Kalil Aff., ¶ 20.²

Plaintiff's Amended Complaint sets forth one count for declaratory judgment requesting this Court to affirm that neither BCI nor Plaintiff owe Kalil any funds under the Brokerage Agreement. Am. Compl. ¶ 30. Kalil, in response, posits two defenses. First, Kalil argues that this Court has no personal jurisdiction over it. Def.'s Mot. to Dismiss ("Def's Mot.") at 1; Def.'s Mem. at 7. Second, Kalil argues that regardless of personal jurisdiction, Plaintiff is the incorrect plaintiff to bring this suit and has misused the Declaratory Judgment Act. Def.'s Mot. at 1; Def.'s Mem. at 19. For the reasons set forth below, Defendant Kalil's Motion to Dismiss is granted for lack of personal...