Lopez v. Council on American-Islamic Relations Action Network, Inc., 15-7016

• Decision Date: 21 June 2016
• Docket Number: C/w 15-7019,No. 15-7016,15-7016
• Citation: 826 F.3d 492
• Parties: Rene Arturo Lopez, et al., Appellants v. Council on American–Islamic Relations Action Network, Inc., Appellee.
• Court: U.S. Court of Appeals — District of Columbia Circuit

826 F.3d 492

Rene Arturo Lopez, et al., Appellants

v.Council on American–Islamic Relations Action Network, Inc., Appellee.

No. 15-7016

C/w 15-7019

United States Court of Appeals, District of Columbia Circuit.

Argued February 12, 2016

Decided June 21, 2016

David Yerushalmi, Chandler, AZ, argued the cause for Appellants. With him on the briefs was Robert Joseph Muise.

Jenifer Wicks, Washington, DC, argued the cause and filed the brief for Appellee.

Before: Srinivasan and Wilkins, Circuit Judges, and Ginsbur g, Senior Circuit Judge.

Opinion for the Court filed by Circuit Judge Wilkins.

This appeal arises out of the bad acts of Morris Days (a/k/a Jamil Days), who held himself out to the public as a civil rights attorney working for a regional chapter of the Council on American–Islamic Relations Action Network (“CAIR” or “CAIR National”), when he was not, in fact, a lawyer. The Maryland/Virginia regional CAIR chapter had hired Days to serve as its civil rights manager, and eventually Days also took up the role of resident attorney. Days took money from CAIR clients in exchange for the promise of legal services, but performed none. Plaintiff–Appellants in this consolidated action are individual CAIR clients who were negatively impacted by Days's conduct. Their lawsuits allege, inter alia , that CAIR is responsible for the bad acts of Days because Days was CAIR's agent. The District Court disagreed and granted summary judgment to CAIR National.

This Court has jurisdiction to review the final decision of the District Court under 28 U.S.C. § 1291. For the reasons set forth below, we reverse the District Court's grant of summary judgment, and remand for further proceedings.

I.

CAIR is a national organization based in Washington, D.C. that works to protect the civil rights of Muslims living in the United States. This work sometimes involves providing legal services. The organization has affiliated local and regional chapter offices, which exist as independent non-profits. Local chapters come into being through a written application process, submitted to the national headquarters, through which CAIR can either grant or deny affiliation. The regional chapter serving Maryland and Virginia was granted approval by the national organization in 2002. Its operations were initially based in Bethesda, Maryland, but eventually moved to Herndon, Virginia. The chapter has been alternately referred to in the public as CAIR-MD/VA or CAIR–VA.

During the relevant time period, CAIR–VA's day-to-day operations were supervised by Khalid Iqbal, the chapter's executive director and an employee of CAIR National. Iqbal was the director of operations for CAIR National, which paid his salary, but served simultaneously as the executive director of the regional chapter at CAIR–VA, on a volunteer basis. Because CAIR National paid Iqbal's salary, Iqbal was considered a sort of in-kind donation from the national organization to the chapter.

Morris Days began working as a volunteer at CAIR–VA in approximately June 2006. After volunteering for some time, Days approached Iqbal seeking full-time employment by the chapter. Iqbal recommended to the CAIR–VA Board that they hire Days, and in January 2007, Days began working as an independent contractor for CAIR–VA's Civil Rights Department, as civil rights manager. Iqbal was Days's immediate supervisor.

Days was initially hired to perform non-legal advocacy for clients who alleged that they faced religious discrimination; this work included making phone calls, writing letters, and referring clients to attorneys when appropriate. It did not require Days to hold a law degree or a license to practice law. Yet, as time passed, Days started to misrepresent to CAIR, to the public, and to his CAIR–VA clients, that he was an attorney and was licensed to practice law. Days then began requesting and accepting fees for the legal services he claimed to be performing—despite CAIR–VA's policy not to take money from its civil rights clients. Days later admitted that he used this money for his personal enrichment.

Iqbal first learned that Days was violating the organization's policy against accepting money from CAIR–VA clients in July 2007, when he received a complaint that Days had accepted money for a client's immigration case, but then had been non-responsive to the client. Iqbal sent an email to Days, seeking an explanation and asking Days to help develop a policy going forward for taking on cases. On or around October or November 2007, Iqbal learned that Days had again taken money from a CAIR–VA client. Following this discovery, Iqbal confronted Days and instructed him to return the money. Iqbal conducted no other investigation into Days's misconduct at that time.

Despite Iqbal's prior warnings to Days not to take money from clients, around January 2008, Iqbal discovered that Days had again received funds from an individual who had come to CAIR–VA for legal assistance. Iqbal again confronted Days, again instructed Days not to accept money from clients, and gave Days a written warning. But the very next week, in early February 2008, Iqbal received a report that Days had solicited funds from yet another individual. Following this discovery, Days was barred from entering the CAIR–VA office, his office keys were taken from him, and he was informed that his relationship with CAIR was terminated effective immediately.

It was only after Days was fired that CAIR started to inquire regarding his status as an attorney. After discovering that Days was not a lawyer, CAIR took possession of CAIR–VA's civil rights case files, as CAIR–VA no longer had anyone that could handle the matters. CAIR had its own personnel review the files. Once CAIR National's staff had reviewed all of the files, Iqbal then informed the individuals with open cases that Days was no longer with CAIR–VA, and recommended attorneys with whom those individuals could consult regarding their cases.

At various times during Days's employment at CAIR–VA, each of the Plaintiffs approached Days in search of legal counsel. Unsurprisingly, Days did not perform the legal work promised. Plaintiffs allege that they have suffered financial loss and emotional distress as a result of this action. CAIR filed a motion for summary judgment, and Plaintiffs opposed, asking the court to treat their filing as a de facto cross-motion for summary judgment pursuant to Federal Rule of Civil Procedure 56(f). The District Court granted CAIR's motion for summary judgment and denied Plaintiffs' cross-motion, holding that the Plaintiffs had failed to raise a genuine issue of material fact regarding whether Days was the agent of CAIR National.

II.

We review the District Court's grant of summary judgment de novo . Holcomb v. Powell , 433 F.3d 889, 895 (D.C. Cir. 2006). Summary judgment is appropriately granted when, viewing the evidence in the light most favorable to the non-movants and drawing all reasonable inferences accordingly, no reasonable jury could reach a verdict in their favor. See Carter v. George Washington Univ. , 387 F.3d 872, 878 (D.C. Cir. 2004). The evidence presented must show “that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a) ; see also Holcomb , 433 F.3d at 895. “[T]he mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact.” Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 247–48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) (emphasis in original). “[M]ateriality is only a criterion for categorizing factual disputes in their relation to the legal elements of the claim and not a criterion for evaluating the evidentiary underpinnings of those disputes.” Id. at 248, 106 S.Ct. 2505. “Only disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment. Factual disputes that are irrelevant or unnecessary will not be counted.” Id.

In conducting our analysis, we review the record taken as a whole. “Where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party, there is no genuine issue for trial.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp. , 475 U.S. 574, 587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (quotation marks omitted). “We are not to make credibility determinations or weigh the evidence.” Holcomb , 433 F.3d at 895 ; see Liberty Lobby , 477 U.S. at 249, 106 S.Ct. 2505 (“[A]t the summary judgment stage the judge's function is not himself to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial.”).

III.

As the District Court held below, Virginia law applies to the Plaintiffs' tort claims. See Lopez v. Council on American–Islamic Relations Action Network, Inc. , 741 F.Supp.2d 222, 235 (D.D.C. 2010). In Virginia, an agency relationship may be established by one of two theories: (1) actual agency; or (2) apparent or ostensible agency. See Wynn's Extended Care, Inc. v. Bradley , 619 Fed.Appx. 216, 218 (4th Cir. 2015). The Plaintiffs are only pursuing their claim under a theory of actual agency. Accordingly, we must determine if the Plaintiffs have raised a genuine issue of material fact as to whether an actual agency relationship existed between Days and CAIR National.

Actual agency is established when one person (the principal) manifests consent to another person (the agent), that the agent “shall act on his behalf and subject to his control,” and the agent likewise manifests “consent so to act.” Reistroffer v. Person , 247 Va. 45, 439 S.E.2d 376, 378 (1994) ; accord Wynn's Extended Care , 619 Fed.Appx. at 218. “The question of agency vel non is one of fact for the fact finder unless the existence of an agency relationship depends upon unambiguous written documents or...