Beach Tv Properties Inc. v. Soloman
Civil Action No. 2015-1823
| D.D.C. | Oct 14, 2016Background
- In December 1999 Henry Solomon, then at Haley Bader & Potts, filed Statements of Eligibility with the FCC for LPTV class A status for several stations; for ACI’s WTHC-LD he omitted substantive Parts 3 and 4 of the one‑page form.
- The FCC dismissed ACI’s submission as a “material deficiency” for failure to answer Part 3 and denied later petitions and requests for reconsideration; the FCC and the D.C. Circuit upheld the agency’s actions and the statutory deadline for filing.
- Solomon moved from Haley Bader to Garvey in March 2000; Haley Bader wound up and dissolved in 2005; Garvey hired Haley Bader attorneys as “of counsel” with delayed ownership prospects and disclaimed Haley’s payables/receivables.
- Plaintiffs (Beach TV and The Atlanta Channel, Inc. (ACI)) allege malpractice by Solomon in preparing the Statement and in subsequent appeals, and seek to hold Haley Bader and Garvey vicariously/successor‑ly liable.
- Procedurally, defendants moved to dismiss: Haley Bader for lack of personal jurisdiction; Garvey for failure to state successor liability and malpractice claims; Solomon for partial dismissal and contesting standing based on an attempted assignment of ACI’s claims to Beach TV.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Personal jurisdiction over Haley Bader | Haley Bader transacted business before the FCC and maintained continuous contacts with D.C., so D.C. courts may exercise general/specific jurisdiction | Haley Bader was a Virginia PLLC, dissolved before suit, was not served in D.C., did not transact business in D.C. re: the WTHC filing | Dismissed for lack of personal jurisdiction: no general jurisdiction; no specific jurisdiction based on filing with a federal agency located in D.C. |
| Successor liability of Garvey for Haley Bader’s 1999 malpractice | Garvey effectively merged with/was mere continuation of Haley Bader when it hired Haley attorneys and continued servicing clients | No meaningful asset transfer, no continuity of ownership/management; arrangement was employment, not a merger | Dismissed: plaintiffs failed to plausibly plead de facto merger or mere continuation; Garvey not successor liable |
| Malpractice for negligent handling of administrative appeals | Solomon/Garvey failed to raise procedural/rulemaking arguments (formal adjudication, retroactivity, rulemaking vs. adjudication, deadline discretion), which would have secured relief | FCC’s dismissal was lawful informal adjudication; the interpretation of “material deficiency” and the January 28 (statutory) deadline were not subject to waiver or rulemaking challenge that would have changed outcome | Dismissed: claims that alleged negligent appeals could not meet causation because FCC’s use of informal adjudication and statutory deadline made reversal implausible |
| Standing after assignment of ACI’s malpractice claims to Beach TV | Beach TV is proper plaintiff (assignment valid) | Assignment invalid under Virginia law (attorney‑client/malpractice claims nonassignable); only ACI retains standing | Held: Virginia law applies to the assignment; assignment invalid; Beach TV lacks standing; only ACI (The Atlanta Channel) may proceed on remaining claim against Solomon |
Key Cases Cited
- Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408 (U.S. 1984) (minimum contacts test for specific jurisdiction)
- International Shoe Co. v. Washington, 326 U.S. 310 (U.S. 1945) (foundational due process personal jurisdiction standard)
- Ashcroft v. Iqbal, 556 U.S. 662 (U.S. 2009) (pleading standard for plausibility under Rule 12(b)(6))
- Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (U.S. 2007) (pleading standard requiring facts to nudge claim from conceivable to plausible)
- Conference Group, LLC v. FCC, 720 F.3d 957 (D.C. Cir. 2013) (agency discretion to proceed by adjudication or rulemaking)
- Nat’l Mining Ass’n v. McCarthy, 758 F.3d 243 (D.C. Cir. 2014) (distinguishing legislative rules, interpretive rules, and policy statements)
- Bingham v. Goldberg, Marchesano, Kohlman, Inc., 637 A.2d 81 (D.C. 1994) (successor‑liability doctrines: de facto merger and mere continuation)
- Virgin Islands Telephone Corp. v. FCC, 989 F.2d 1231 (D.C. Cir. 1993) (courts discourage acceptance of untimely petitions absent extremely unusual circumstances)
- Marathon Oil Co. v. EPA, 564 F.2d 1253 (9th Cir. 1977) (Section 558(c) does not independently require full formal adjudicatory hearings)