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Ghatt v. Seiler

United States District Court, D. Maryland

July 20, 2017




         Plaintiff Jeneba Jalloh Ghatt filed this action alleging state common law claims of defamation, false light, disparagement, malicious use of process, tortious interference with contract, and breach of the implied covenant of good faith and fair dealing, all arising out of proceedings relating to the performance of an escrow agreement for which Ghatt was the escrow agent. Pending before the Court is the Motion to Dismiss filed by Defendants Thomas W. Seiler and Robinson, Seiler & Anderson, LC ("RSA") (collectively, "the Seiler Defendants".. For the reasons set forth below, the Motion is granted.


         In December 2014, Ghatt, an attorney, entered into an escrow agreement ("the Agreement") with Strategic Capital Enterprises, Inc. ("Strategic Capital") and Grove Plaza, LLC ("Grove Plaza") on behalf of the Ghatt Law Group, which is now defunct. Under the Agreement, Strategic Capital and Grove Plaza appointed the Ghatt Law Group as the escrow agent in connection with a joint venture through which Strategic Capital would secure a $5 million loan to Grove Plaza. Grove Plaza was to deposit $500, 000 into an escrow account, which would then be disbursed to Strategic Capital only after Ghatt Law Group (1) verified that Strategic Capital, in turn, had deposited $500, 000 "into a sub-account at Citi Private Bank in the name of Grove Plaza, LLC" and (2) delivered a confirmation of deposit letter and a copy of a letter of authorization to Grove Plaza, Strategic Capital, and New Freedom Group, LLC. Agreement ¶¶ 2.1, 6.4, ECF No. 23-2. Ghatt alleges that the owners of Grove Plaza had persuaded Defendant James C. Yates to loan Grove Plaza the $500, 000 needed for the escrow cash deposit in exchange for a $250, 000 return on investment after three months and an ownership interest in Grove Plaza. Under the arrangement, if Grove Plaza was unable to secure the loan, Yates would be refunded the $500, 000. Yates agreed to the arrangement with the knowledge that his money would be received by Strategic Capital and used to secure the loan.

         Later that month, Ghatt received verification from Citi Private Bank that the sub-account had been created, followed the instructions in the Agreement, and disbursed "the bulk of the $500, 000 less fees" to Strategic Capital. Am. Compl. ¶ 25. She took no further action, operating under the belief that the deposit would automatically be refunded to Yates if the loan was not secured. When the loan was not secured within a three month period and Yates did not automatically recover his investment, he hired Seiler of RSA as his attorney.

         According to Ghatt, Yates told the Seiler Defendants that he knew that his money would be promptly disbursed to Strategic Capital. Seiler, however, believed that he was most likely to be able to recover Yates's investment if he brought suit against Ghatt claiming that she had breached her duty to Yates and had "purposefully lured Yates to send her money by sending him a letter of inducement." Id. ¶¶ 31-32. Seiler therefore filed a complaint in Utah state court on behalf of Yates in which, according to Ghatt, Seiler "presented false and misleading claims" and provided only two pages of the full Agreement in order to create the impression that Ghatt had cheated Yates out of money. During a February 8, 2016 hearing in that proceeding, Seiler stated that Ghatt had sent Yates two pages of the Agreement "in order to create a false impression" that she induced Yates to release the $500, 000 to her, before then admitting that she had not sent Yates any communication,, including but not limited to the Agreement. Id. ¶¶ 40-41. Seiler also coordinated with two other parties in the Utah proceeding to have them sign and submit an affidavit with facts that he knew were "misleading and inaccurate." Id. ~ 63. The Utah state court ultimately issued an order finding that Ghatt violated the duty of care she owed to Yates, causing her to have to appeal the order and expend resources to continue to defend herself.

         Seiler also filed related claims in Maryland. On March 22, 205,, Seiler filed a complaint with the Attorney Grievance Commission of Maryland that Ghatt asserts to be an attempt to present Ghatt in "a bad light" and advance his client's case in Utah. Id. ¶¶ 35, 118. According to Ghatt, on July 20, 206,, Seiler "insinuated" to the Attorney Grievance Commission that Ghatt had sent Yates two pages of the Agreement in order "to create an impression that she attempted to swindle Yates out of money." Id. ~ 44. Then on October 12, 2015, Seiler filed a complaint with the Client Protection Fund of the Bar of Maryland in which he falsely alleged that Ghatt had stolen, and breached her duty to protect, Yates's money.

         Ghatt filed this action in the Circuit Court for Prince George's County, Maryland. The Seiler Defendants then removed the case to this Court with the consent of Yates. At a November 9, 2066 case management conference, the parties agreed that Ghatt, having been informed of the Seiler Defendants' argument~ for dismissal, would amend the Complaint to address those issues before the Seiler Defendants filed their motion to dismiss. The Court notified Ghatt that because she had been given the opportunity to amend, if the Amended Complaint was nevertheless deficient, the Court would likely dismiss with prejudice without further opportunity to amend. On November 28, 2016, Ghatt filed her Amended Complaint, alleging that, as a result of Defendants' actions in the Utah and Maryland proceedings, she has had to pay legal fees to defend herself; has suffered extreme and severe emotional distress, anxiety and humiliation; lost potential work and income; had to close down her firm; and is facing the possible loss of her law license.


         The Seiler Defendants are seeking dismissal of all counts of the Amended Complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). They argue that Ghatt's claims for defamation (Count I) and false light (Count II) are barred by common law privilege and that Ghatt has not alleged sufficient facts to state a claim for disparagement (Count III), malicious use of process (Count IV), tortious interference with contract (Count V), or breach of the implied covenant of good faith and fair dealing (Count VI). They also argue that Ghatt's claims of defamation, false light, and disparagement are time-barred.

         I. Legal Standard

         To defeat a motion to dismiss under Rule 12(b)(6), the complaint must allege enough facts to state a plausible claim for relief. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). A claim is plausible when the facts pleaded allow "the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. Legal conclusions or conclusory statements do not suffice. Id. The Court must examine the complaint as a whole, consider the factual allegations in the complaint as true, and construe the factual allegations in the light most favorable to the plaintiff. Albright v. Oliver, 510 U.S. 266, 268 (1994); Lambeth v. Bd of Comm 'rs of Davidson Cty., 407 F.3d 266, 268 (4th Cir. 2005).

         The Court notes that while pleadings of self-represented litigants are to be construed liberally, Erickson v. Pardus, 551 U.S. 89, 94 (2007), the United States Court of Appeals for the Fourth Circuit has not yet decided "whether a pro se plaintiff who is also an attorney receives the benefit of this liberal construction"" Willner v. Dimon, 849 F.3d 93, 103 (4th Cir. 2017) (quoting Kerr v. Marshall Univ. Bd. of Governors, 824 F.3d 62, 72 (4th Cir. 2016)). Out of an abundance of caution, the Court will construe Ghatt's Amended Complaint liberally.

         Courts are permitted to consider documents attached to a motion to dismiss "when the document is integral to and explicitly relied on in the complain,, and when the plaintiffs do not challenge the document's authenticity." Zak v. Chelsea Therapeutics Int'l, Ltd.,780 F.3d 597, 606-07 (4th Cir. 2015) (quoting Am. Chiropraciic Ass'n v. Trigon Healthcare, Inc.,367 F.3d 212, 234 (4th Cir. 2004)) (internal quotation marks omitted). Here, Ghatt refers to and relies upon the Agreement in her Amended Complaint and does not dispute the authenticity of the copy attached to the Motion. The Court will therefore consider the Agreement. However, the affidavits and exhibits attached ...

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