Klayman v. Judicial Watch, Inc., Civil Action No. 06-670 (CKK).

Citation628 F.Supp.2d 112
Decision Date25 June 2009
Docket NumberCivil Action No. 06-670 (CKK).
PartiesLarry KLAYMAN, Plaintiff, v. JUDICIAL WATCH, INC., et al., Defendants.
CourtU.S. District Court — District of Columbia

Larry Klayman, Miami, FL, pro se.

Richard Wayne Driscoll, Driscoll & Seltzer, PLLC, Alexandria, VA, for Defendants.

MEMORANDUM OPINION

COLLEEN KOLLAR-KOTELLY, District Judge.

Plaintiff Larry Klayman brought this action against Defendants—Judicial Watch, Inc. (hereinafter "JW" or the "organization"), a non-profit public interest government watchdog organization; Thomas J. Fitton, President of JW; Paul J. Orfanedes, Secretary and a Director of JW; and Christopher J. Farrell, a Director of JW ("Individual Defendants," together with JW, "Defendants")—alleging a variety of claims, including, inter alia, breach of contract, violation of the Lanham Act, 15 U.S.C. § 1125(a)(1)(A) and (B), and defamation. Presently before the Court are a number of motions, including: (1) Klayman's motion for partial summary judgment as to Count Six of his Second Amended Complaint; (2) JW's motion for partial summary judgment as to Counts Four, Six, Seven, Eight, and Nine of the Second Amended Complaint; (3) Fitton's motion for partial summary judgment as to Counts Four, Six, and Nine of the Second Amended Complaint; (4) Orfanedes' motion for partial summary judgment as to Counts Four, Six, and Nine of the Second Amended Complaint; (5) Farrell's motion for partial summary judgment as to Counts Four, Six, and Nine of the Second Amended Complaint; and (6) JW's motion for partial summary judgment as to Counts One, Two, Three and Ten of its Amended Counterclaim.

Upon a searching consideration of the filings currently before the Court on these motions, the attached exhibits, and the relevant statutes and case law, with respect to Klayman's Second Amended Complaint, the Court shall: (1) grant Defendants' motions for summary judgment as to Count Four; (2) deny Klayman's partial motion for summary judgment as to Count Six and shall grant Defendants' cross-motions for partial summary judgment as to Count Six; (3) deny-in-part and grant-in-part JW's motion for partial summary judgment as to Counts Seven and Eight; and (4) grant Defendants' motions for partial summary judgment as to Count Nine. With respect to the Amended Counterclaim, the Court shall: (1) grant JW's motion for partial summary judgment as to Count One as to liability, but hold in abeyance as to damages; and (2) deny JW's motion for partial summary judgment as to Counts Two, Three and Four.

In light of the Court's decision herein, the following claims and counterclaims remain at issue. First, as to Klayman's Second Amended Complaint, the following allegations of breach of contract asserted in Counts Seven and Eight remain viable as to JW: (1) JW's alleged failure to make a good faith effort to remove Klayman as guarantor of the building's lease; (2) JW's failure to pay health insurance for Klayman's children; (3) JW's filing a motion to strike Klayman's appearance in Florida litigation; (4) JW's failure to provide Klayman with access to documents regarding Mr. Paul; and (5) JW's alleged disparagement of Klayman and misrepresentations of the reasons for his departure from the organization. Second, with respect to JW and Fitton's Amended Counterclaim, Count One remains at issue as to damages only and Counts Two through Eleven remain at issue in their entirety.

I: BACKGROUND
A. Factual Background

The Court shall assume familiarity with the its January 17, 2007 and April 3, 2007 Memorandum Opinions, which each set forth in detail the factual background of this case. See Klayman v. Judicial Watch, Inc., Civil Action No. 06-670, 2007 WL 140978 (D.D.C. Jan. 17, 2007) (hereinafter "1/17/09 Klayman"); Klayman v. Judicial Watch, Civil Action No. 06-670, 2007 WL 1034937 (D.D.C. Apr. 3, 2007) ("4/3/07 Klayman"). The Court shall therefore only briefly address herein such facts as are necessary for resolution of the motions currently before the Court. Moreover, given the numerous issues raised by the parties, most of which implicate a discrete set of facts, the Court at this point provides only a short introduction to the facts of this case, with a more detailed discussion to follow below as is necessary for evaluation of a particular claim.

As previously established, Defendant Judicial Watch, Inc. ("JW" or the "organization") is a 501(c)(3) organization formed under the laws of the District of Columbia and headquartered in the District of Columbia. 4/3/07 Klayman, 2007 WL 1034937, at *2. Defendant Fitton is President of Judicial Watch, Defendant Orfanedes is the Secretary and a Director of Judicial Watch, and Defendant Farrell is a Director of Judicial Watch (together, "Individual Defendants") (collectively with "JW," "Defendants"). Id. Plaintiff Larry Klayman ("Klayman") is the self-described founder and former Chairman, General Counsel and Treasurer of Judicial Watch, who resides in and practices law in the State of Florida. Id. From 1998 to 2003, Klayman was Chairman, General Counsel and Treasurer of JW, as well as an employee and member of the organization's Board of Directors. Defs.' Stmt. ¶ 1. On September 19, 2003, Klayman entered into a detailed Severance Agreement, signed by Klayman and Fitton, on behalf of JW, and attested to by Orfanedes, as Corporate Secretary of Judicial Watch. 4/3/07 Klayman, 2007 WL 1034937, at *2; Defs.' Stmt. ¶¶ 3-11 & Ex. A (9/19/03 Severance Agreement).1 Klayman signed the Severance Agreement both as an individual and in his capacity as President of his law firm, Klayman & Associates, P.C. ("K & A"). Defs.' Stmt. ¶ 6; see also Severance Agreement at p. 12. The parties negotiated the terms of the Severance Agreement over the course of several months prior to its execution. 4/3/07 Klayman, 2007 WL 1034937, at *2; Defs.' Stmt. ¶¶ 3-9. Throughout the course of those negotiations, Klayman was himself a licensed attorney, and was represented by attorneys from two different law firms. 4/3/07 Klayman, 2007 WL 1034937, at *2; Defs.' Stmt. ¶¶ 7-9.

B. Procedural Background

On April 12, 2006, Klayman filed the instant lawsuit. Shortly thereafter, Klayman filed his Second Amended Complaint, in which he alleges six causes of action against various combinations of Defendants, relating to his separation from JW. See Second Amended Complaint, Docket No. [12], (hereinafter, "SAC").2 By a Memorandum Opinion and Order dated January 17, 2007, the Court dismissed Count Nine of the SAC, which alleges a claim of defamation, insofar as it relates to allegedly defamatory statements made in JW's Form 990 tax returns and allegedly doctored press quotations posted on JW's website. See 1/17/07 Klayman, 2007 WL 140978, at *1. On April 3, 2007, the Court dismissed Count Five of the SAC, which alleged violation of Florida state law, see Klayman v. Judicial Watch, Civ. Action No. 06-670, 2007 WL 1034936, *1 (D.D.C. Apr. 3, 2007), and granted Defendants summary judgment as to parts of: (1) Count Six, which alleges breach of contract, in so far as it relates to claims that JW fraudulently induced Klayman to enter into the Severance Agreement; and (2) Counts Seven and Eight, which allege breach of contract, in so far as they relate to allegations that JW failed to pay Klayman for the period of time between September 15 through September 19, 2003, see 4/3/07 Klayman, 2007 WL 1034937, at *6. Accordingly, Klayman's remaining claims consist of:

• Count Four: alleging violations of Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a)(1)(A) and (B) against all Defendants, SAC ¶¶ 97-106;

• Count Six: alleging breach of contract (rescission) against JW, excluding claims of fraudulent inducement;

• Count Seven: alleging breach of contract (damages) against JW, excluding allegations that JW failed to pay Klayman for the period between September 15 and 19, 2003;

• Count Eight: alleging breach of contract (specific performance) against JW, excluding allegations that JW failed to pay Klayman for the period between September 15 and 19, 2003;

• Count Nine: alleging defamation as against all Defendants, but only based on claims that Defendants made defamatory statements to JW's employees and the media.

In addition, Defendants JW and Fitton have filed a Counterclaim against Klayman, which was amended on December 3, 2007. See Am. Counterclaim, Docket No. [86]. In their Amended Counterclaim, Defendants JW and Fitton assert 11 causes of action against Klayman, including for breach of contract, indemnification, trademark infringement, unfair competition, and cybersquatting. See id. ¶¶ 68-138.

C. The Instant Motions for Summary Judgment

Currently pending before the Court are the parties' various motions for partial summary judgment. First, Klayman filed a motion for partial summary judgment as to Count Six (breach of contract-rescission) of his Second Amended Complaint, which asserts a breach of contract claim based on alleged breaches of the Severance Agreement and seeks an order granting the equitable remedy of rescission. See Pl.'s MSJ, Docket No. [275]; Pl.'s Stmt., Docket No. [276]. Notably, despite the Court's repeated admonishments that the parties must comply with Local Civil Rule 7(h) and 56.1,3 Klayman's statement of material facts filed in support of his motion failed to include references to the parts of the record relied on to support the statement, as required. The Court therefore struck Klayman's motion for partial summary judgment and the related statement in their entirety, but in its discretion, gave Klayman another opportunity to file a motion for partial summary judgment with a properly prepared statement. See 12/1/08 Min. Order. Klayman subsequently filed his revised motion and statement on December 3, 2008, with citations to the record as required. See Pl.'s MSJ, Docket No. [275...

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