Sobot v. Clean the World Found.

1

NIKOLA SOBOT, Plaintiff, v. CLEAN THE WORLD FOUNDATION INC., Defendant.

Civil Action No. 22-cv-1846 (TSC)

United States District Court, District of Columbia

September 9, 2024

MEMORANDUM OPINION

TANYA S. CHUTKAN, UNITED STATES DISTRICT JUDGE

Plaintiff Nikola Sobot sued his former employer, Clean the World Foundation, Inc., alleging several violations of D.C employment law after he was terminated while on sick leave. Following discovery, the parties cross-moved for summary judgment. Having reviewed the record and the briefs, the court will GRANT in part and DENY in part Plaintiff's motion and GRANT in part and DENY in part Defendant's cross motion.

I. BACKGROUND

Plaintiff began employment with Defendant as “Director Development of Fundraising” on August 1, 2019. Offer Letter, ECF No. 22-4 at 1; see Employment Verification, ECF No. 266. His initial annual salary was $110,000, but he was promised an increase to $120,000 if he personally raised $100,000 in new funds, and $125,000 if he personally raised $150,000 in new funds. Offer Letter at 1-2. Plaintiff was never compensated at a higher rate, however. Pl.'s Resp. to Def.'s First Set of Interrogs. & Req. for Prod. of Docs., ECF No. 26-8 at 5. Instead, his salary was reduced three times between November 2019 and April 2020, before it was reinstated to $110,000 in July 2021. Id. at 4-5; see Nov. 1, 2019 Mem., ECF No. 26-3; Jan. 15, 2020 Mem., ECF No. 26-5.

Defendant's declarant provided that, during Plaintiff's two years of employment, he personally raised $131,000 in new funds. Decl. of Ken Parker, ECF No. 22-3 ¶ 13 (“Parker Decl.”). Plaintiff, however, asserts that he personally raised close to $1 million in new funds, primarily because of a Center for Disease Control (“CDC”) grant valued at approximately $990,000. Email Re: Termination and Offer of Resignation, ECF No. 26-1.

Once the CDC grant was secured, Plaintiff took approximately three weeks paid time off. Dep. of Nikola Sobot, ECF No. 22-6 at 116:3-9 (“Sobot Dep.”). During that time, he agreed to be available to handle any issues that came up regarding the CDC grant, but “for everything else,” was “not available basically.” Id. at 116:12-16, 120:2-6. Plaintiff claims that during his time off, however, he was “disturbed heavily” by Defendant's employees, who “request[ed] send us this, send us that, so on.” Id. at 116:18-21.

When Plaintiff officially announced the CDC contract to Defendant's Board in December 2021, it came to light that Plaintiff committed Defendant to provide services in Louisiana and Utah instead of the locations Defendant had directed him to target. Parker Decl. ¶ 19. Defendant asked Plaintiff to renegotiate the contract for the desired locations, but he refused. Id. Another employee then stepped in and successfully renegotiated the contract. Id. ¶ 21. At some point prior to January 2022, Plaintiff erased most of his CDC grant-related emails. Id. ¶ 23.

In response to the CDC negotiations, Defendant decided to terminate Plaintiff on or before January 7, 2022, on the basis of insubordination, disregard for assignments, misrepresentations to management, failure to produce substantial personal fundraising, and destroying the CDC emails. Id. ¶¶ 24-25. Plaintiff was scheduled to meet with his supervisor on January 10, 2022, when his supervisor planned to inform him of his termination. Id. ¶ 26. On January 10, however, Plaintiff took sick leave. Id. ¶ 27. Defendant nonetheless informed him of his termination and offered him a severance package which he rejected. Id. ¶¶ 28-30.

Plaintiff sued in D.C. Superior Court in May 2022. See Compl., ECF No. 9 at 1. Defendant removed the action to this court soon thereafter. See Notice of Removal, ECF No. 1. At the close of discovery, Defendant moved for summary judgment on all counts, ECF No. 22 (“Def.'s Mot.”) and Plaintiff cross-moved for partial summary judgment, see ECF No. 26 at 1 (“Pl.'s Mot.”). The court subsequently requested supplemental briefing on the amount in controversy, Min. Order, June 12, 2024, which the parties submitted, agreeing that the amount in controversy is satisfied. See Def.'s Suppl. Br., ECF No. 31; Pl.'s Resp., ECF No. 33.

II. LEGAL STANDARD

Under Federal Rule of Civil Procedure 56, courts “shall grant summary judgment if the movant shows 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). A fact is material if “a dispute over it might affect the outcome of a suit under governing law; factual disputes that are ‘irrelevant or unnecessary' do not affect the summary judgment determination.” Holcomb v. Powell, 433 F.3d 889, 895 (D.C. Cir. 2006) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). An issue is genuine if “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id. (quoting Anderson, 477 U.S. at 248). The party seeking summary judgment bears the burden to provide evidence showing “the absence of a genuine issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986).

III. JURISDICTION

The court has diversity jurisdiction here. Plaintiff is domiciled in the District, Compl. ¶ 4, and Defendant is domiciled in Florida, its principal place of business, Parker Decl. ¶ 3; 28 U.S.C. § 1332(c)(1).

The amount in controversy also exceeds $75,000 because Plaintiff requests $32,000 in lost wages, “treble damages” under D.C. law, along with “compensatory and punitive damages in amounts to be determined at trial,” “reasonable attorneys' fees, expert fees, and costs,” and “pre-judgment and post-judgment interest.” Compl. Prayer for Relief ¶¶ F-I. Considering treble damages puts the amount in controversy at $96,000, even without considering punitive damages. See, e.g., Bradford v. George Washington Univ., 249 F.Supp.3d 325, 334 (D.D.C. 2017) (considering treble damages in determining amount in controversy).

Consequently, the court has subject matter jurisdiction.

IV. COUNTS 1, 3, AND 4

In Counts 1 and 3, Plaintiff alleges that Defendant violated the D.C. Wage Payment Collection Law and breached their employment agreement by reducing his salary on several occasions, failing to increase his salary when he met fundraising benchmarks, requiring him to work while he was on paid leave, and refusing to pay out his unused vacation time upon termination. Compl. ¶¶ 22-23, 33-34. In Count 4, Plaintiff alleges that Defendant unjustly enriched itself at his expense by retaining wages due to him. Id. ¶ 37.

The D.C. Wage Payment Collection Law requires employers to “pay all wages earned to his employees at least twice during each calendar month,” D.C. Code § 32-1302, and defines “wages” as “all monetary compensation after lawful deductions, owed by an employer for labor or services rendered, whether the amount is determined on a time, task, piece, commission, or other basis of calculation,” id. § 32-1301(3). This law defines “wages earned” by reference to the relevant employment agreement, where applicable. See, e.g., Craig v. Not for Profit Hosp. Corp., 626 F.Supp.3d 87, 108 (D.D.C. 2022). “‘Discretionary payments,'” such as bonuses, “do not qualify as wages under the Act because they ‘are not owed, but are given only by leave of the employer.'” Harbour v. Univ. Club of Wash., 610 F.Supp.3d 123, 133 (D.D.C. 2022).

The elements of a breach of contract claim under D.C. law are: (1) a valid contract, (2) an obligation or duty arising out of the contract, (3) a breach of that duty, and (4) damages caused by the breach. Tsintolas Realty Co. v. Mendez, 984 A.2d 181, 187 (D.C. 2009). A “valid and enforceable contract requires ‘both (1) agreement as to all material terms, and (2) intention of the parties to be bound.'” Simon v. Circle Assocs., 753 A.2d 1006, 1012 (D.C. 2000) (citation omitted). “The proper interpretation of a contract, including whether a contract is ambiguous, is a legal question.” Abdelrhman v. Ackerman, 76 A.3d 883, 887 (D.C. 2013) (citation omitted). In construing contractual language, “the court must determine what a reasonable person in the position of the parties would have thought” it meant, from an objective perspective. Fort Lincoln Civic Ass'n v. Fort Lincoln New Town Corp., 944 A.2d 1055, 1064 (D.C. 2008) (citation omitted); see Simon, 753 A.2d at 1012. If a court decides a contract is ambiguous, “summary judgment is generally improper” unless “the non-moving party fails to point to any relevant extrinsic evidence supporting that party's interpretation of the language” for consideration by a jury. Abdelrhman, 76 A.3d at 219.

“Modification of a contract normally occurs when the parties agree to alter a contractual provision or to include additional obligations, while leaving intact the overall nature and obligations of the original agreement.” Hildreth Consulting Eng'rs, P.C. v. Larry E. Knight, Inc., 801 A.2d 967, 974 (D.C. 2002). The parties “are free to modify a contract at any time” by “mutual consent.” 2301 M St. Coop. Ass'n v. Chromium LLC, 209 A.3d 82, 88 (D.C. 2019). In the employment context, “an employer may prospectively modify the terms of at-will employment,” and “the employee's continued service amounts to acceptance of the modification.” Kauffman v. Int'l Bhd. of Teamsters, 950 A.2d 44, 48 (D.C. 2008). That is the rule because “neither party to at-will employment is bound to continue performance,” and therefore doing so is “valid consideration for the change in terms.” Id.

Finally unjust enrichment under D.C. law “has its roots in the common law concept of quasi-contract.” 4934, Inc. v. D.C. Dep't of Emp. Servs., 605 A.2d 50, 55 (D.C. 1992). This concept is a “legal fiction invented by common law courts to permit recovery by contractual remedy...