Moldauer v. Constellation Brands Inc.

Decision Date03 April 2015
Docket NumberCase No. 14–cv–01984 CRC
Citation87 F.Supp.3d 148
PartiesEdwin Moldauer, Plaintiff, v. Constellation Brands Inc., et al., Defendants.
CourtU.S. District Court — District of Columbia

Edwin Moldauer, Beer-Sheva, Israel, pro se.

Robert S. Metzger, Lucas Taylor Hanback, Rogers Joseph O'Donnell, Eric Joseph Young, U.S. Attorney's Office, Washington, DC, Paul M. Zieff, Rogers Joseph O'Donnell, San Francisco, CA, for Defendants.

MEMORANDUM OPINION AND ORDER

CHRISTOPHER R. COOPER, United States District Judge

Edwin Moldauer filed four unsuccessful whistleblower complaints with the U.S. Department of Labor (“DOL”) alleging that he was terminated for accusing his former employer, Constellation Brands, of accounting fraud. He now brings suit in this Court, claiming that Constellation owes him 13 years of back-pay because it never actually fired him. He also asks the Court to reinstate his whistleblower allegations, which DOL dismissed at the administrative level as untimely. And he seeks to amend his complaint to add further claims against Constellation and DOL and new claims against the Federal Trade Commission (“FTC”). Because the Court lacks subject-matter jurisdiction over Moldauer's claims directed at DOL and lacks personal jurisdiction over Constellation, it will dismiss Moldauer's complaint. Because Moldauer's proposed amendments to his complaint would ultimately prove futile, the Court will also deny his motion to amend.

I. Background

Constellation Brands, Inc., a wine and spirits producer, hired Edwin Moldauer in 2000 as a senior cost analyst at the Mission Bell winery in Madeira, California. Compl. ¶¶ 5–7. Moldauer alleges that he was “posted away” from that position in late 2002 and has not received a paycheck from the company since. Id. ¶¶ 14–16. The timing of Moldauer's new “posting” happens to coincide with a California state criminal complaint and bench warrant issued against him for alleged theft of trade secrets. Constellation Ex. 21 (Complaint, People v. Moldauer, CR 1424 (Dec. 31, 2002)). Moldauer left the country—he is not a United States citizen, although it is unclear from the parties' various filings whether he is a citizen of Australian, New Zealand, or Israel—and currently resides in Israel. Compl. ¶ 1.

Moldauer has filed four whistleblower complaints with DOL against Constellation under the Sarbanes–Oxley Act of 2002, Pub. L. 107–204, 116 Stat. 745 (July 30, 2002). Compl. at 5. Notwithstanding that he now alleges that he is owed his yearly salary for the last 12 years, in each of these complaints he alleged that he was terminated in 2002 because he complained of accounting fraud. Moldauer v. Constellation Brands, Inc., ALJ No.2014–SOX–035, slip op. at 2 (Oct. 20, 2014) (collecting cases). All of Moldauer's complaints were dismissed by DOL as untimely. Id. at 2–3; Moldauer v. Canandaigua Wine, Co., ARB No. 04–022, 2005 WL 4891658 (Dec. 30, 2005).

After his latest administrative complaint was dismissed, Moldauer filed this suit against Constellation and DOL, alleging that Constellation owes him back-pay and requesting that the Court review his whistleblower claim. DOL has moved to be dismissed from the case, contending that the Court lacks subject-matter jurisdiction to entertain a suit to review its administrative decision. Constellation also has moved to dismiss for a host of reasons, including lack of personal jurisdiction, improper venue, that the action is time-barred, and that Moldauer signed a release shortly after his termination.

After the defendants filed their motions to dismiss, Moldauer moved to amend his complaint. In his proposed amended complaint, he seeks to add new claims against Constellation for breach of contract, defamation, libel, malicious prosecution, and harassment, among others. He adds claims for defamation, libel, “breach of privacy,” and “failure to provide legal protections” against DOL for issuing the decisions dismissing his various whistleblower actions. He also seeks to name the FTC as a defendant. In 2009, that agency brought administrative charges against Constellation for allegedly making misrepresentations about a product called “Wide Eye.” Compl., Matter of Constellation Brands, Inc., No. C–4266, 2009 WL 1701439 (Jun. 10, 2009), available at https://www.ftc.gov/sites/default/files/documents/cases/2009/10/091006cbcmpt.pdf. Moldauer submitted an objection to the FTC's eventual settlement with Constellation, which the agency published pursuant to the Commission's Rules of Practice, 16 C.F.R. § 2.34. Letter from Donald S. Clark, Secretary, FTC, to Edwin Moldauer, Oct. 2, 2009, available at https://www.ftc.gov/sites/default/files/documents/cases/2009/10/091006edwinmoldauerletter.pdf. Moldauer contends that publishing his letter placed him in a false light and violated his right to privacy.

II. Standard of Review

When a defendant raises a challenge to the court's jurisdiction under Federal Rule of Civil Procedure 12(b)(1), the plaintiff must establish by a preponderance of the evidence that the court has subject-matter jurisdiction. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992). The court assumes the “truth of all material factual allegations in the complaint and ‘construe[s] the complaint liberally, granting [the] plaintiff the benefit of all inferences that can be derived from the facts alleged.’ Am. Nat'l Ins. Co. v. FDIC, 642 F.3d 1137, 1139 (D.C.Cir.2011) (quoting Thomas v. Principi, 394 F.3d 970, 972 (D.C.Cir.2005) ). The court, however, gives the plaintiff's factual allegations closer scrutiny when resolving a Rule 12(b)(1) motion than would be required for a Rule 12(b)(6) motion for failure to state a claim.” Byrum v. Winter, 783 F.Supp.2d 117, 122 (D.D.C.2011) (citing Macharia v. United States, 334 F.3d 61, 64, 69 (D.C.Cir.2003) ). Also unlike a motion to dismiss under Rule 12(b)(6), “the district court may consider materials outside the pleadings in deciding whether to grant a motion to dismiss for lack of jurisdiction.” Jerome Stevens Pharm., Inc. v. FDA, 402 F.3d 1249, 1253 (D.C.Cir.2005).

Faced with a motion to dismiss under Rule 12(b)(2), the plaintiff also bears the burden of establishing a factual basis for the court's exercise of personal jurisdiction over the defendants. Crane v. N.Y. Zoological Soc'y, 894 F.2d 454, 456 (D.C.Cir.1990). The court again may consider relevant material outside of the pleadings. Jung v. Assoc. of Am. Med. Colls., 300 F.Supp.2d 119, 127 (D.D.C.2004). But all disputed issues of fact are resolved in favor of the plaintiff. Crane, 894 F.2d at 456. “To survive a motion to dismiss [under Rule 12(b)(6) ], a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ). While the court must “assume [the] veracity” of any “well-pleaded factual allegations” in the complaint, conclusory allegations “are not entitled to the assumption of truth.” Id. at 679, 129 S.Ct. 1937.

III. Analysis

DOL contends that the Court lacks subject-matter jurisdiction to consider the administrative decision dismissing Moldauer's most recent whistleblower complaint. Constellation, meanwhile, maintains that the Court lacks personal jurisdiction over it. Lastly, the defendants and the FTC oppose Moldauer's motion to amend the complaint, contending that amendment would be futile. The Court will address each issue in turn. Both defendants raise additional defenses to the merits of Moldauer's complaint, but because the Court determines that it lacks jurisdiction, it will not review these points.

A. Jurisdiction to Review Sarbanes–Oxley Whistleblower Complaint

Moldauer brought his whistleblower complaint under 18 U.S.C. § 1514A, which prohibits an employer from discharging an employee who provides information regarding potential securities fraud to a law enforcement organization or regulatory agency. A wrongfully terminated employee may file a complaint with the Secretary of Labor and, if the Secretary fails to issue a final decision within 180 days, may bring an action for de novo review in the appropriate district court. Id. § 1514A(b)(1). The complainant may also appeal the final decision of the Secretary to the court of appeals for the circuit in which the violation occurred or in which the complainant resided on the date of the violation. Id. § 1514A(b)(2)(A) ; 49 U.S.C. § 42121(b)(4)(A). Outside of this appeal process, the Secretary's decision cannot be reviewed in any other proceeding. 49 U.S.C. § 42121(b)(4)(B). Though his complaint is unclear, Moldauer is either asking the Court to consider his securities fraud allegations de novo under Section 1514A(b)(2), or he is asking the Court to review an appeal of DOL's decision to dismiss his complaint.

If Moldauer seeks to bring his claim of unlawful discharge to the Court for de novo review, then DOL is not a proper party. Such an action would be brought against the public company that purportedly discharged him on the basis of his alleged whistleblower activity, or any subsidiary or affiliate organization. See 18 U.S.C. § 1514A(a). Here, the only proper defendant for such a claim would be Constellation. If instead Moldauer seeks to appeal the final decision of the Secretary that dismissed his administrative complaint, then this is not the proper court. As stated above, Moldauer could only bring an appeal of the Secretary's decision to the court of appeals where the alleged violation occurred. See 49 U.S.C. § 42121(b)(4). In this case, because Moldauer lived and worked in California when he was fired, he could only have filed an appeal with the Ninth Circuit.

Moldauer also maintains that he is bringing a claim under the due process clause, and thus need not follow the jurisdictional limitations described above. But “the mere...

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  • Lewis v. Mutond
    • United States
    • United States District Courts. United States District Court (Columbia)
    • 24 Septiembre 2021
    ...in the complaint, "conclusory allegations ‘are not entitled to the assumption of truth.’ " Moldauer v. Constellation Brands Inc. , 87 F. Supp. 3d 148, 153 (D.D.C. 2015) (quoting Ashcroft v. Iqbal , 556 U.S. 662, 679, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ); see First Chicago Int'l v. Unite......
  • Duarte v. Nolan
    • United States
    • United States District Courts. United States District Court (Columbia)
    • 17 Mayo 2016
    ...accepted as true, to state a claim to 190 F.Supp.3d 12relief that is plausible on its face." Moldauer v. Constellation Brands, Inc., 87 F.Supp.3d 148, 152–53 (D.D.C.2015) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) ) (internal quotation marks omitte......
  • Lewis v. Mutond
    • United States
    • United States District Courts. United States District Court (Columbia)
    • 24 Septiembre 2021
    ...in the complaint, “conclusory allegations ‘are not entitled to the assumption of truth.”' Moldauer v. Constellation Brands Inc., 87 F.Supp.3d 148, 153 (D.D.C. 2015) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 679 (2009)); see First Chicago Int'l v. United Exchange Co., 836 F.2d 1375, 1378-79 ......

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