Inova Health Care Servs. v. Omni Shoreham Corp.
| Decision Date | 30 September 2022 |
| Docket Number | Civil Action 20-784 (JDB) |
| Parties | INOVA HEALTH CARE SERVICES, FOR INOVA FAIRFAX HOSPITAL AND ITS DEPARTMENT, LIFE WITH CANCER, et al., Plaintiffs, v. OMNI SHOREHAM CORP., Defendant. |
| Court | U.S. District Court — District of Columbia |
This case arises from a contract between plaintiffs-Inova Health Care Services, for Inova Fairfax Hospital and its Department Life with Cancer (“Inova”) and Smith Center for Healing and the Arts (“Smith Center”)-and defendant Omni Shoreham Corporation (“Omni”). The parties agreed that plaintiffs would hold an annual fundraising gala at the Omni Shoreham Hotel (“Hotel”) on September 21, 2019. Each side alleges that the other breached that contract-plaintiffs assert that Omni breached by relocating the event to different locations in the Hotel, and Omni claims that Inova breached by refusing to pay liquidated damages after cancelling the gala at the Hotel. Both parties now seek summary judgment. See generally Omni's Mem. of L. Supporting Its Mot. for Summ. J. [ECF No. 62-1] (“Omni MSJ”); Mem. in Supp. of Inova's Mot for Summ. J. [ECF No. 63-1] (“Inova MSJ”). For the following reasons, the Court will deny both motions for summary judgment.
Inova Health Care Services is a nonprofit healthcare provider that operates many hospitals, including Inova Fairfax Hospital and a department of that hospital, “Life with Cancer.” Pl.'s Statement of Material Facts as to Which There Is No Genuine Dispute [ECF No. 63-2] (“Inova SUMF”) ¶ 1. In 2008, Robert Hisaoka created the “Joan Hisaoka ‘Make a Difference' Gala” (“Gala”), an annual charity event, to “raise money to support organizations, including Inova.” Id. ¶ 2; see Omni's Statement of Undisputed Facts Supporting Omni MSJ [ECF No 62-2] (“Omni SUMF”) ¶ 1. The Gala is a “black-tie event” that includes “a formal dinner, silent and live auctions, and dancing,” as well as other programs. Omni SUMF ¶ 1; see Inova SUMF ¶ 4. Inova's “Life With Cancer department has been a beneficiary of the Gala every year since 2010.” Inova SUMF ¶ 3. Plaintiffs assert that Smith Center was a beneficiary of the Gala, id. ¶ 109; see Omni SUMF ¶ 5, though the parties dispute whether Omni was aware of this fact, see Omni SUMF ¶¶ 14, 34-35.
Beginning in 2013, and every year thereafter until 2018, the Gala was held at the Hotel. Omni SUMF ¶ 2. The Gala is organized by Hisaoka through his company RGH Management Services, LLC (“RGH”). Id. ¶ 3; see Inova SUMF ¶ 6. Each year, Hisaoka signs a written fundraising agreement with Inova, which provides that the cost of the Gala is to be paid from donations received in connection with the Gala, after which Inova (and other beneficiaries) receive allocations of the donations. Inova SUMF ¶ 6; Omni SUMF ¶¶ 5-6; see Fundraising Agreement - 2019 [ECF No. 62-3] (“Inova-RGH 2019 Agreement”)[1] at 5. The Inova-RGH 2019 Agreement also gave Hisaoka and RGH “full authority and responsibility for planning, organizing and implementing the [Gala],” including the right and responsibility to enter into “contracts and agreements associated with the [Gala] . . . on behalf of, and as agent for,” the beneficiaries. Inova-RGH 2019 Agreement at 1. That fundraising agreement for the 2019 Gala was signed by Sage Bolte, then the Executive Director of Inova's “Life With Cancer” department, on December 18, 2018. Omni SUMF ¶¶ 7-8; Inova-RGH 2019 Agreement at 8.
On December 14, 2018, Hisaoka-acting as “Event Chair/Authorized Agent” for “Inova Health Care Services for Inova Fairfax Hospital and its department, Life with Cancer, as beneficiary of the 2019 Joan Hisaoka Make a Difference Gala”-signed a “Letter of Agreement” with Omni, providing that the Hotel would host the 2019 Gala on September 21, 2019. First Am. Compl. Ex. A [ECF No. 26] (“Agreement”) at 1-2, 6[2]; see Inova SUMF ¶ 46; Omni SUMF ¶¶ 10, 15.[3] The “Event Details” section of the Agreement lists the Gala's reserved locations as the “Ambassador Ballroom” for a “Cocktail Reception” and “Dessert Reception,” and the “Regency Ballroom” for a “Gala Dinner.” Agreement at 2; Omni SUMF ¶ 16; Inova SUMF ¶ 47. The “expected attendance” for the Cocktail Reception and Dinner is listed as “400”; the parties agreed to “a catering minimum of $70,000.00 in catered food and beverage purchases” and that Omni would “be notified of the exact attendance no later than” noon on September 18, 2019. Agreement at 2; see Inova SUMF ¶ 75 n.18.
Inova agreed to pay which would be used against the total cost; if the Gala was “cancelled for reasons other than a default hereunder by the Hotel . . ., this deposit w[ould] be applied toward any liquidated damages due.” Agreement at 3; Inova SUMF ¶ 53; see Omni SUMF ¶ 33; Inova SDF ¶ 7 (disputing whether the $10,000 deposit was required to secure the reservation “at the Hotel” or “to secure the Ambassador and Regency Ballrooms”). Under the “Cancellation” section, the Agreement provides that if Inova cancelled the Gala “between June 23, 2019 and July 22, 2019,” it would pay “$29,000.00” “as liquidated damages and not as a penalty.” Agreement at 3; see Inova SUMF ¶ 55. Finally, under the section “Changes, Additions, Stipulations, or Lining Out,” the parties agreed that “[a]ny changes, additions, stipulations, or decisions . . . w[ould] not be considered agreed to or binding unless such modifications [were] initialed or otherwise approved in writing by both parties.” Agreement at 6; see Inova SUMF ¶ 57; see also Omni's Statement of Material Facts in Dispute, in Opp'n to Inova MSJ [ECF No. 64-1] (“Omni SDF”) ¶ 57 (). The Agreement was signed on December 14, 2018 by Hisaoka on behalf of Inova and countersigned by Michael Schneider, “Director of Catering & Convention Services,” and Michael Murgas, “Director of Sales,” on Omni's behalf. Agreement at 6.
On July 8, 2019, an Omni employee informed Hisaoka by email that the Hotel had relocated, or was planning to relocate, the Gala from the Ambassador and Regency Ballrooms to alternative spaces at the Hotel (the Roberts Restaurant and the Blue Room). Omni SUMF ¶ 38; Inova SUMF ¶ 80; see Inova SDF ¶ 10 (). By a letter dated July 9, 2019, plaintiffs' counsel responded to that email and demanded that Omni reverse its decision to relocate the Gala. Omni SUMF ¶ 42; Inova SUMF ¶¶ 85-86; see First Am. Compl. Ex. C [ECF No. 26] (“July 9 Letter”) at 2 ( ). Omni declined to rescind its reassignment decision, Omni SUMF ¶ 43; Inova SUMF ¶ 87; see First Am. Compl. Ex. D [ECF No. 26] (“July 11 Email”) at 1 ( ).
Plaintiffs' counsel responded by letter on July 12, 2019, informing Omni that plaintiffs would not hold the Gala at the Hotel. Omni SUMF ¶ 45; Inova SUMF ¶ 104; see Inova SDF ¶ 12 (); First Am. Compl. Ex. E [ECF No. 26] (“July 12 Letter”) at 3 (“[The July 11 email] only confirms further unequivocally and positively that the Hotel has repudiated the terms and conditions of the Agreement Accordingly, please be advised that our client has decided against holding the [Gala] at the Hotel and, instead, will file suit against the Hotel and seek all remedies that are available under the Agreement and at law ....”). Plaintiffs also “demanded” that Omni return the $10,000 deposit via check issued by
Smith Center. Omni SUMF ¶ 55; Inova SUMF ¶ 107; see Inova SDF ¶ 14 (); July 12 Letter at 3 (“[G]iven the Hotel's default and breach of the Agreement, [plaintiffs] hereby demand that . . . the Hotel return to [plaintiffs] the $10,000 deposit made by us ....”). Omni agreed to return the deposit and issued a check to Smith Center. Omni SUMF ¶¶ 56-57 (); Inova SUMF ¶ 107.
Inova ultimately held its 2019 Gala at the Mandarin Oriental Hotel on September 21, 2019. Omni SUMF ¶ 54; Inova SUMF ¶ 109. And, pursuant to a contract signed by Omni on July 8, 2019, Omni hosted an event for the Embassy of Lebanon in the Regency and Ambassador Ballrooms of the Hotel “from September 19, 2019, through September 22, 2019.” Omni SUMF ¶ 37; Inova SUMF ¶ 103; see Omni MSJ Ex. 6 [ECF No. 62-8] (“Embassy Agreement”) at 1-8[4](Letter of Agreement between Embassy of Lebanon and Omni for an event from “9/19/2019 -9/22/2019”).
In March 2020, plaintiffs filed suit against Omni in D.C Superior Court, alleging that Omni breached the Agreement and the implied covenant of good faith and fair dealing. See Compl. [ECF No. 1-3] ¶¶ 36-40, 42-44.[5]Omni removed the case to this Court, see Notice of Removal [ECF No. 1] at 1, answered the complaint, see...
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