Glenn v. Fay
222 F. Supp. 3d 31
| D.D.C. | 2016Background
- In Peterson v. Islamic Republic of Iran, this Court entered default judgments against Iran for the 1983 Beirut Marine barracks bombing; plaintiffs were later awarded large recoveries and a $1.75 billion turnover from frozen Iranian assets that became a Qualified Settlement Fund (QSF).
- Jay Glenn alleges he contracted with attorneys Thomas Fay and Steven Perles (and their firms) under a 2003 written Associate Counsel Agreement to receive 3% of gross collections for claims he proved before a Special Master; he also alleges an additional oral agreement entitling him to 11.11% for referrals.
- Glenn claims he represented or referred 103 plaintiffs (63 under the written agreement and 40 under the oral agreement) and that those claims were awarded over $309 million.
- Glenn alleges defendants repudiated payment in 2010 and previously sued in S.D.N.Y.; that suit was dismissed for lack of jurisdiction.
- Glenn filed this declaratory-judgment action in D.D.C. seeking a declaration that defendants must remit to him amounts due upon distribution from the QSF Trust.
- The court dismissed the declaratory action sua sponte, exercising its discretion under the Declaratory Judgment Act because the requested declaration would not clarify legal relations or terminate the controversy and would instead precipitate piecemeal litigation.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether federal court should hear Glenn's declaratory-judgment action | Glenn seeks an advance declaration that defendants must remit amounts from the QSF upon distribution; argues statute of limitations has not run because payment and refusal are future events | Fay and Perles argue the suit should be dismissed: (1) barred by D.C. 3-year statute of limitations triggered by Glenn's 2010 S.D.N.Y. filing; (2) failure to plead breach elements | Court declined to exercise jurisdiction over the declaratory claim and dismissed the action sua sponte — did not reach statute-of-limitations or merits |
| Whether a declaratory judgment would serve a useful purpose | Glenn: seeks clarity of rights before distribution to avoid uncertainty | Defs: disputes over performance, enforceability, and parties' obligations mean a declaration won’t avoid litigation | Court: declaration would not meaningfully clarify duties and would likely require further damages litigation |
| Whether declaratory relief would terminate the controversy | Glenn: declaration would establish entitlement before funds are distributed | Defs: factual disputes remain (performance, whether Perles bound, apportionment) so controversy would persist | Court: declaration would not terminate the dispute and would create piecemeal litigation |
| Whether dismissal is appropriate under the discretionary aspects of the Declaratory Judgment Act | Glenn: declaratory relief is proper to resolve contractual obligations pre-breach | Defs: equitable and prudential reasons counsel dismissal | Court: exercised discretion to dismiss because relief would serve no useful purpose and would produce piecemeal litigation |
Key Cases Cited
- Md. Cas. Co. v. Pac. Coal & Oil Co., 312 U.S. 270 (1941) (defining Article III "case or controversy" standard for declaratory relief)
- Wilton v. Seven Falls Co., 515 U.S. 277 (1995) (Declaratory Judgment Act grants courts discretion whether to entertain suits)
- MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007) (clarifying nature of controversy required for declaratory relief)
- President v. Vance, 627 F.2d 353 (D.C. Cir. 1980) (two-prong test: useful purpose or termination of controversy for declaratory relief)
- Gibson v. Liberty Mut. Grp., Inc., 778 F. Supp. 2d 75 (D.D.C. 2011) (declining declaratory relief when it would cause piecemeal adjudication)
- Roth v. D.C. Courts, 160 F. Supp. 2d 104 (D.D.C. 2001) (courts should avoid expending resources resolving issues that will not fully resolve plaintiff's claims)
- Peterson v. Islamic Republic of Iran, 758 F.3d 185 (2014) (appellate decision in Peterson litigation)
- Bank Markazi v. Peterson, 136 S. Ct. 1310 (2016) (Supreme Court decision affirming seizure/turnover of Iranian assets)