United States District Court, D. Maryland
LETTER TO COUNSEL
Dear
Counsel:
I am in
receipt of the Motion for Partial Summary Judgment on the
Issue of Liability filed by Plaintiff Championship
Tournaments, LLC, d/b/a Elite Tournaments
(“Elite”), ECF 59, and the Motion for Judgment on
the Pleadings With Respect to Plaintiff's Claim for
Declaratory Relief, filed by Defendants United States Youth
Soccer Association, Inc. d/b/a U.S. Youth Soccer, United
States Youth Soccer Association, Inc. d/b/a U.S. Youth Soccer
Region I, United States Youth Soccer Association, Inc. d/b/a
Eastern Regional League, and United States Youth Soccer
Association, Inc. d/b/a U.S. Youth Soccer Region I-Eastern
Regional League (collectively “USYSA”), ECF 62. I
have reviewed both motions, along with the respective
oppositions and replies. ECF 63, 64, 65. No hearing is
necessary. See Loc. R. 105.6 (D. Md. 2018). For the
reasons stated below, Elite's Motion is GRANTED in part
as to Counts I and II and DENIED in part as to Count III, and
USYSA's Motion is GRANTED.
The
parties agree that on October 7, 2016, they entered a
three-year contract, under which Elite would manage the
Eastern Region of USYSA's youth soccer program and would
recoup all revenue generated by USYSA's tournament
events. See ECF 63 at 2 (USYSA's concession of
liability). The parties also agree that USYSA materially
breached the contract by restructuring its regional leagues,
and by hiring a different event management company to operate
and manage youth soccer tournaments within the Eastern Region
during the 2018-19 soccer season. Id. Accordingly,
USYSA does not oppose entry of judgment, solely on the issue
of liability, as to Count I (breach of contract) and Count II
(anticipatory breach of contract).[1] Id.
The
parties' primary dispute centers around the viability of
Count III. Citing the Declaratory Judgment Act, 28 U.S.C.A.
§ 2201 et seq., [2] Elite seeks a declaration:
A. Declaring that USYSA is a party to the Contract, and is
liable to Elite for all damages suffered by Elite as a
consequence of its breach of the Contract;
B. Declaring that USYSA is a party to the Contract, and is
liable to Elite for all damages suffered by Elite as a
consequence of its anticipatory breach of contract; and
C. Awarding Elite all costs and fees incurred in pursuing
this action.
ECF 1-3, ¶ 82.
USYSA
seeks judgment on the pleadings as to Count III, because the
relief sought is duplicative of the elements of Counts I and
II. ECF 59. Elite counters that the relief sought in Count
III is not duplicative, but Elite does not specifically
identify the differences between its claims. See ECF
64, ¶¶ 17-20. In the Court's assessment, the
declaratory relief Elite seeks in subsections “A”
and “B” of Count III is entirely duplicative of
the elements of Elite's breach of contract claims,
warranting judgment in USYSA's favor. See John M.
Floyd & Assocs., Inc. v. Howard Bank, No.
RDB-18-2887, 2019 WL 1755968, at *4 (D. Md. Apr. 18, 2019)
(dismissing, as duplicative, a declaratory judgment count
that encompassed the plaintiff's entire breach of
contract claim). The only exception is subsection “C,
” Elite's request for an award of its costs and
fees incurred in this action.
The
Declaratory Judgment Act “is not one which adds to the
jurisdiction of the court, but is a procedural statute which
provides an additional remedy for use in those cases and
controversies of which the federal courts already have
jurisdiction.” Aetna Cas. & Sur. Co. v.
Quarles, 92 F.2d 321, 323 (1937). The determination
whether to grant declaratory relief rests in the Court's
discretion. See Id. at 324 (noting that the
Declaratory Judgment Act “merely gives the court power
to grant the remedy without prescribing any of the conditions
under which it is to be granted, and it is hardly to be
supposed that it was intended that it should be granted as of
course in every case where a controversy exists”). The
Fourth Circuit has noted that the principal criteria in favor
of granting declaratory judgments are: (1) when the judgment
will serve a useful purpose in clarifying and settling the
legal relations in issue, and (2) when it will terminate and
afford relief from the uncertainty, insecurity, and
controversy giving rise to the proceeding. Id. at
325.
Neither
of those criteria is applicable here. The parties' legal
relations, vis-à-vis Elite's breach of contract
claims, are well-settled as a result of the judgment on
liability being granted herein. Instead, Elite attempts to
use the federal Declaratory Judgment Act to obtain relief
otherwise unavailable for its state law claims. In Maryland,
unless a contract expressly provides for recovery of costs
and fees, the American rule applies to breach of contract
cases. See Collier v. Md.-Individual Practice
Ass'n, 327 Md. 1, 17 (1992) (“With the
exception of cases involving liability insurers and cost of
defense, Maryland law has never recognized fee shifting in
breach of contract actions, absent contractual provision,
statute or rule.”). The Declaratory Judgment Act does
not create any additional entitlement to monetary remedies,
and cannot be used to vitiate the American rule. Because
Count III, then, cannot afford Elite any relief it will not
already obtain via its judgment on liability in Counts I and
II, judgment for USYSA on Count III will be granted.
For the
reasons set forth above, Elite's Motion for Partial
Summary Judgment, ECF 59, is GRANTED as to Counts I and II
and DENIED as to Count III. USYSA's Motion for Judgment
on the Pleadings as to Count III, ECF 62, is granted. A
telephonic scheduling conference will be set to discuss a
trial date regarding damages.
Despite
the informal nature of this letter, it should be flagged as
an Opinion. ...