Smith v. Rubicon Advisors, LLC
254 F. Supp. 3d 245
| D.D.C. | 2017Background
- Todd W. Smith was a lobbyist for Rubicon Advisors, LLC from 2011 until his termination in 2016; dispute centers on unpaid retirement contributions and “additional compensation” tied to client revenue shares.
- Smith alleges Rubicon failed to pay retirement benefits for 2014–2016 and withheld additional compensation owed for client revenue in 2015 and 2016.
- After termination (with minimal notice), Smith was denied access to email, office files, and client-related materials; Rubicon left his biography on its website and did not update client contacts.
- Smith sued on multiple theories including breach of contract, Wage Act violations, unjust enrichment (Count IV), and interference with prospective business opportunities (Count V).
- Rubicon moved to partially dismiss Counts IV and V under Rule 12(b)(6); the court evaluated whether Smith adequately pleaded unjust enrichment as an alternative theory and tortious interference under D.C. law.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether unjust enrichment may be pleaded alongside contract claims | Smith may plead unjust enrichment alternatively in case contract is invalid or interpreted differently | Rubicon: unjust enrichment barred because contract governs the subject matter | Court: Denied dismissal; unjust enrichment may be pleaded as an alternative at this stage because parties dispute contract scope/validity |
| Whether unjust enrichment elements are sufficiently alleged | Smith alleges he conferred benefits (work/revenue), Rubicon retained them, and retention is unjust | Rubicon contends the contract governs these obligations, precluding quasi-contract relief | Court: At pleading stage, allegations suffice; dismissal premature absent resolution of contract scope |
| Whether Smith pleaded a protectable business expectancy | Smith alleges clients intended to transfer work to him after his firing and Rubicon knew of that expectancy | Rubicon says Smith lacked an independent relationship or valid expectancy separate from employment | Court: Denied dismissal; complaint alleges a distinct expectancy and knowledge by Rubicon |
| Whether interference claim requires total loss of clients or contracts | Smith alleges Rubicon’s denial of access made representation more difficult/costly, causing damage | Rubicon argues plaintiff must allege complete loss of future contracts/clients | Court: Denied dismissal; partial impairment or increased burden is cognizable damage under D.C. law and Restatement principles |
Key Cases Cited
- Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading standard: factual allegations must plausibly state a claim)
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading must raise entitlement to relief above speculative level)
- Banneker Ventures, LLC v. Graham, 798 F.3d 1119 (D.C. Cir.) (accept allegations as true on motion to dismiss)
- Fort Lincoln Civic Ass’n v. Fort Lincoln New Town Corp., 944 A.2d 1055 (D.C. 2008) (elements of unjust enrichment under D.C. law)
- In re APA Assessment Fee Litig., 766 F.3d 39 (D.C. Cir.) (unjust enrichment will not lie when contract governs the relation; but alternative pleading may be permitted)
- McWilliams Ballard, Inc. v. Broadway Mgmt. Co., 636 F. Supp. 2d 1 (D.D.C.) (permitting unjust enrichment as alternative theory at pleading stage)
- Sununu v. Philippine Airlines, Inc., 792 F. Supp. 2d 39 (D.D.C.) (dismissing unjust enrichment at summary judgment where contract validity upheld)
- Jankovic v. Int’l Crisis Grp., 593 F.3d 22 (D.C. Cir.) (elements for interference with prospective business opportunities)
- Bennett Enters. v. Domino’s Pizza, Inc., 45 F.3d 493 (D.C. Cir.) (formulation of tortious interference elements)
- Solers, Inc. v. Doe, 977 A.2d 941 (D.C. 2009) (harm to prospective opportunities and reputational harm can support interference claims)