Capitol Services Management v. Vesta Corporation, 933 F.3d 784

Background

Park Southern contracted with Capitol Services to manage the Park Southern Apartments; Park Southern later defaulted under a Deed of Trust that allowed the District to resume control of the property.
In March 2014 Park Southern terminated Vesta’s prior manager; Capitol Services began managing under a one-year, year-to-year agreement.
On May 2–3, 2014 the District exercised its default remedy, took over the property, and without notifying Capitol Services awarded an "emergency contract" to Vesta to assume management.
Capitol Services sued the District in July 2014 (amended Oct. 2014) asserting tortious interference; discovery (including a July 2016 deposition of Milton Bailey) later revealed additional facts about communications between District officials and Vesta.
Capitol Services sued Vesta in federal court in Aug. 2017; the district court dismissed as time-barred, holding inquiry notice (and thus accrual) occurred by May 3, 2014. The D.C. Circuit reversed and remanded.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
When did the 3-year statute of limitations for tortious interference accrue under D.C. discovery rule?	Accrual delayed until plaintiff had inquiry notice of all essential elements (including Vesta's intentional interference), which plaintiff did not have until Bailey's July 2016 deposition.	Accrual occurred at the latest by May 3, 2014 (termination and Vesta takeover) or by July 2014 (original suit against the District).	Remand: accrual (inquiry notice) arose sometime after the July 2014 complaint but by the Oct. 2014 amended complaint; timing within that period is a factual question precluding Rule 12(b)(6) dismissal.
Whether the district court could treat the Superior Court pleadings as establishing notice at Rule 12(b)(6) stage	Pleadings in the Superior Court case do not establish on their face when plaintiff had inquiry notice of Vesta’s role.	District court relied on those pleadings to show plaintiff had reason to suspect wrongdoing earlier.	Court may judicially notice pleadings for what was alleged (not their truth); but the July 2014 complaint did not allege Vesta’s involvement—those allegations appear only in the Oct. 2014 amended complaint.
Whether the Superior Court judgment precludes litigation against Vesta by collateral estoppel	Plaintiff: prior Superior Court decision dismissed for lack of jurisdiction, not on the merits; so no preclusion.	Vesta: Superior Court language saying no evidence of interference should preclude relitigation.	No collateral estoppel: Superior Court dismissed for sovereign immunity (lack of jurisdiction), so its comments were dictum and not an adjudication on the merits.
Whether to resolve merits (failure to state a claim) on appeal	Plaintiff: claims sufficiently pleaded; merits should be decided by district court on remand.	Vesta: asks affirmance on merits or preclusion grounds.	Court declines to decide merits; left to district court on remand.

Key Cases Cited

Momenian v. Davison, 878 F.3d 381 (D.C. Cir. 2017) (Rule 12(b)(6) statute-of-limitations review standard)
Commonwealth Land Title Ins. Co. v. KCI Techs., Inc., 922 F.3d 459 (D.C. Cir. 2019) (complaint is conclusively time-barred standard)
Firestone v. Firestone, 76 F.3d 1205 (D.C. Cir. 1996) (statute-of-limitations dismissal at motion-to-dismiss stage)
Diamond v. Davis, 680 A.2d 364 (D.C. 1996) (inquiry notice defined; factual question for accrual)
Cevenini v. Archbishop of Wash., 707 A.2d 768 (D.C. 1998) (discovery rule and inquiry notice principles)
Price v. Washington Metro. Area Transit Auth., 41 A.3d 526 (D.C. 2012) (framing discovery rule as discovery of all essential elements)
Jankovic v. Int’l Crisis Group, 593 F.3d 22 (D.C. Cir. 2010) (element of intentional interference required in tortious-interference claims)
B&B Hardware, Inc. v. Hargis Indus., Inc., 135 S. Ct. 1293 (2015) (collateral estoppel / issue preclusion principles)