Saiyed v. Council on American-Islamic Relations Action Network, Inc.

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUl\/IBIA IFTIKHAR SAIYED, Plaintiff, Civil Action No. 10-0022 (PLF) V. COUNCIL ON AMERICAN-ISLAMIC RELATIONS ACTION NETWORK, INC., Defendant. RENE ARTURO LOPEZ, e_t a_l., Plaintiffs, v. COUNCIL ON AMERICAN-ISLAMIC RELATIONS ACTION NETWORK, INC., Defendant. \_/\/\/\/\/\/\/\/\./\_/\/\/\/VVV\_/\_/\/\/\/`/\/V OPINION Pending before the Court in these consolidated actions is the motion [Dkt. No. 135 in Civil Action No. 10-0022 and Dkt. No. 136 in Civil Action No. 10-0023] of defendant Council on American-lslamic Relations Action Network, lnc. (“CAIR”) for partial summary judgment on plaintiffs’ claim under the Virginia Consumer Protection Act (“VCPA”), VA. CODE ANN. § 59.1-196, e_t M. Upon careful consideration of the parties’ papers, the relevant legal authorities, and the entire record in this case, the Court will deny the motion.1 l. BACKGROUND The Court’s prior Opinions summarize the factual and procedural history of this case. B hopez v. CAIR, 741 F. Supp. 2d 222 (D.D.C. 2010); Saiyed v. CAIR, 742 F. Supp. 2d 84 (D.D.C. 2010); Saiyed v. CAIR, 78 F. Supp. 3d 465 (D.D.C. 2015), rev. and remanded by Lopez v. CAlR, 826 F.3d 492 (D.C. Cir. 2016). Briefly, CAIR is a national “l\/Iuslim advocacy group.” §_e_e Statement of Facts at 4. Between 2007 and 2008, plaintiffs sought legal assistance from Morris Days, an individual who was hired to “act as resident attorney” of CAIR’s Virginia chapter, CAIR-VA. § § at 4-5. In particular, Mr. Days allegedly promised to assist plaintiffs with claims relating to “immigration status, divorce proceedings, hostile work environment, and employment discrimination.” § @pe_Z Am. Compl. 11 14; _S_ain Am. Compl. W 54-55. Mr. Days purportedly took money and other forms of payment from at least some of the plaintiffs in exchange for these promises of representation, despite CAIR’s policy to provide legal services pro bono. § Statement of Facts at 5; Me_d Am. Compl. 11 6. Mr. Days, however, was not a licensed attorney and “did not provide the services he represented he would provide Plaintiffs.” 1 Unless otherwise noted, all references to the docket in this Opinion are to Civil Action No. 10-0022. The Court reviewed the following filings and exhibits attached thereto in resolving the pending motion: Saiyed Amended Complaint (“Saiyed Am. Compl.”) [Dkt. No. 3]; Lopez Amended Complaint (“Lopez Am. Compl.”) [Dkt. No. 5 in Civil Action No. 10-0023]; October 7, 2016 Memorandum Opinion and Order (“Oct. 7, 2016 Mem. Op. & Order”) [Dkt. No. 108]; CAIR’s Motion for Partial Summary Judgment (“l\/Iot.”) [Dkt. No. 135]; Plaintiffs’ Memorandum in Opposition to Motion for Partial Summary Judgment (“Opp’n”) [Dl ER, FEDERAL PRACTICE AND PRoCEDURE § 4507, at 124-25 (3d ed. 2018) (“[T]he federal court must determine issues of state law as it believes the highest court of the state would presently determine them, not necessarily (although usually this will be the case) as they previously have been decided by other state courts.”). To determine how the highest court of a state would rule on an issue of state law, federal courts “consider all of the resources to which the highest court of the state could look,” g Leon’s Bakerv, Inc. v. Grinnell Corp., 990 F.2d 44, 48 (2d Cir. 1993), giving some deference tojudgments by intermediate appellate courts w West v. Am. Tel. & Tel. Co., 311 U.S. 223, 237 (1940) (“[l]t is the duty of [federal courts] in every case to ascertain from all the available data what the law is and apply it . . . .”). While the decision of a state intermediate appellate court is not controlling, a judgment by an intermediate appellate court “is a datum for ascertaining state law which is not to be disregarded by a federal court unless it is convinced by other persuasive data that the highest court of the state would decide otherwise.” E M Am. Tel. & Tel. Co., 311 U.S. at 237. g also Allstate Ins. v. l\/ienards, lnc., 285 F.3d 630, 637 (7th Cir. 2002); Howe ex rel. Howe v. Scottsdale lns., 204 F.3d 624, 627 (5th Cir. 2000); Richardson v. United States, 841 F.2d 993, 996 (9th Cir. 1988). Even less weight is accorded to the decision of a state trial court. w, gg, Hampton Co. Nat. Sur., LLC. v. Tunica County, Mississippi, 543 F.3d 221, 226 (5th Cir. 2008); Bryant Elec. Co., Inc. v. Citv of Fredericksburg, 762 F.2d 1192, 1194 (4th Cir. 1985). “State trial court decisions are . . . entitled to consideration as an indication of what state law is, but in and of themselves they are not controlling on the federal courts, especially if they are not regarded as' precedents within the state itself.” 19 WRIGHT, l\/IILLER & COOPER, supra § 4507, at 152-53. A federal court is tasked with evaluating lower court decisions just as the state’s highest court would - that is, it is “empowered to change state law and correct what it believes to be erroneous rulings of lower state courts.” §e_e_ i_d. at 120. CAIR relies exclusively on two Virginia Circuit Court decisions holding that the VCPA does not apply to legal services because legal services do not meet the statutory definition of “consumer transaction.” g Oberto v. Grogan, NO. CL14-138, 88 Va. Cir. 188, 2014 WL 8383045, at *2 (Va. Cir. Ct. Apr. 18, 2014); Bd. of Dirs. ofthe Port Roval Condo. Unit Owners’ Ass’n v. Crossland Sav. FSB, No. (Chancery) 18453, 1989 Va. Cir. LEXIS 80, 15 Va. Cir. 239, 241 (Va. Cir. Ct. Jan. 5, 1989). Although Virginia Circuit Courts are “[t]he only trial court of general jurisdiction in Virginia,” qualifying civil decisions are appealable from them directly to the Supreme Court of Virginia by petition, meaning that there can be no intermediate appellate rulings on these cases or this issue.2 Notwithstanding this hybrid model, Virginia Circuit Court precedent is nonbinding, and “it would be incongruous indeed to hold the federal court bound by a decision which would not be binding on any state court.” King v. Order of United Com. Travelers ofAm., 333 U.S. 153, 161 (1948). § also Brvant Elec. Co. v. Citv of Fredericksburg, 762 F.2d at 1194 (“[S]uch lower court opinions . . . are not binding on the Virginia Supreme Court or on [the Fourth Circuit][;] these decisions ‘are entitled to 335 consideration as an indication of what state law is . . . . (citing WRIGHT, MILLER & COOPER, 2 _S_ee Office of the Exec. Sec’y, Supreme Court of Virginia, Virginia Courts in Brief, VIRGINIA’S JUDICIAL SYSTEi\/i, http://www.courts.state.va.us/courts/home.html (last visited Sept. 25, 2018). FEDERAL PRACTICE AND PRoCEDuRE: JuRisDiCTioN § 4507 (1981))); Harris v. Lukhard, 733 F.2d 1075, 1082 (4th Cir. 1984). Without further explanation, two Virginia Circuit Court judges have stated that “legal services” do not fit the definition of a “consumer transaction” under the VCPA and that “[i]t would be [an] anomalous result to conclude that some legal services are covered by the [VCPA] while others are not.” E Oberto v. Grogan, 88 Va. Cir. 188, 2014 WL 8383045, at *2 (quoting Bd. of Dirs. ofthe Port Roval Condo. Unit Owners’ Ass’n v. Crossland Sav. FSB, 1989 Va. Cir. LEXIS 80, 15 Va. Cir. at 241-42). But both ofthose cases involved malpractice claims against atto'rneys, not individuals or organizations who improperly held themselves out as licensed attorneys and provided legal services The Court therefore finds those decisions inapposite and unpersuasive More importantly, they are not binding on this Court in discerning how the highest court of the Commonwealth of Virginia would interpret the VCPA. In projecting or predicting how the highest court of the state would interpret a state statute, the Court may consider state trial court precedent, even though it is not binding, §Y, M, at 8-9, and should also consider all other resources that the highest court of the state would itself consider. See, e.g., Leon’s Bakerv, Inc. v. Grinnell Corp., 990 F.2d at 48. lt then applies established methods of statutory interpretation that the highest court of the state would apply. § Travelers lns. Co. v. 633 Third Assocs., 14 F.3d, 114, 119 (2d Cir. 1994). According to the Virginia Supreme Court, “[t]he primary objective in statutory construction is to determine and give effect to the intent of the legislature as expressed in the language of the statute. When a statute is unambiguous we must apply the plain meaning of that language. lf the statute is subject to more than one interpretation, we must apply the interpretation that carries out the legislative intent.” §_e_e Appalachian Power Co. v. State Corp. Com’n, 733 S.E.2d 250, 256 (Va. 10 2012) (citations omitted). § also Halifax Corp. v. First Union Nat. Bank, 546 S.E.2d 696, 702 (Va. 2001) (“[T]he intention of the legislature . . . must be gathered from the words used, unless a literal construction would involve a manifest absurdity.” (quoting Watkins v. Hall, 172 S.E. 445, 447 (Va. 1934))); Barr v. Town & Countrv Properties, lnc., 396 S.E.2d 672, 674 (Va. 1990); Brown v. Lukhard, 330 S.E.2d 84, 87 (Va. 1985) (“[W]hen the language of an enactment is free from ambiguity, resort to legislative history and extrinsic facts is not permitted because we take the words as written to determine their meaning.” (citing Citv of Portsmouth v. City of Chesapeake, 136 S.E.2d 817, 825 (Va. 1964))). On the other hand, when statutory language is ambiguous or uncertain, courts attempt to predict how the highest court of the state would resolve the uncertainty by looking at “statutory language, pertinent legislative history, the statutory scheme set in historical context, how the statute can be woven into the state law with the least distortion of the total fabric, state decisional law, federal cases which construe the state statute, scholarly works and any other reliable data tending to indicate how the [higher state court] would resolve the issue.” §§ Travelers lns Co. v. 633 Third Assocs., 14 F.3d at 119 (citation omitted). w alj Yurecka v. Zappala, 472 F.3d 59, 62 (3d Cir. 2006); LA_L Specialtv lris. v. Lapalme, 258 F.3d 35, 38 (lst Cir. 2001). The first question here is whether the statutory term “consumer transaction” in the VCPA is ambiguous For the VCPA to apply to dealings between a consumer and a supplier, a supplier must commit “fraudulent acts or practices . . . in connection with a consumer transaction.” VA. CODE ANN. § 59.1-200. To qualify as a “consumer transaction,” the dealings between a consumer and a supplier must constitute “[t]he advertisement, sale, lease, license or offering for sale, lease or license, of goods or services to be used primarily for personal, family or household purposes” M. § 59.1-198. The “services” to be used “include but shall not be ll limited to (i) work performed in the business or occupation of the supplier [or] (ii) work performed for the supplier by an agent. . . .” I_d. “Supplier” is defined as “a seller, lessor or licensor who advertises, solicits or engages in consumer transactions . . . .” l_d_. The Court concludes that the pertinent statutory language is clear by its terms and covers the legal services at issue here. The dealings between plaintiffs (the consumers) and CAIR and/or Mr. Days (the supplier) qualify as “services” because l\/lr. Days’ activities constituted “work performed in the business or occupation of the supplier.” VA. CODE ANN. § 59.1-198. Whether the “supplier” is CAIR or Mr. Days, the work promised to plaintiffs was legal services §§ Statement of Facts at 5; Reply at 8. Mr. Days was hired by CAlR-VA as “its ‘resident attorney’ and ‘manager’ of its civil rights department to provide legal representation to Muslims complaining of various civil rights abuses.” §_a_i)§l Am. Compl. 11 4; Statement of F acts at 4-5. Mr. Days failed to deliver the legal services promised to plaintiffs while he was acting as an employee of CAIR. Whether Mr. Days acted as an “agent “of CAIR is an issue that is disputed by the parties § Lopez v. CAIR, 826 F.3d at 496-99. Nonetheless, Mr. Days’ conduct qualifies as the provision of “services” under the VCPA because it was work performed while he was employed by CAIR, in the course of the organization’s activities as a “l\/luslim advocacy group.” Statement of Facts at 4. Furthermore, even though CAIR’s “stated policy [was] to provide pro bono legal services to the public,” plaintiffs contend that “Days fraudulently obtained money from CAIR clients for CAIR’s legal representation,” qualifying as a “sale” of services for purposes of the statute. _S_a_iy_e_d Am. Compl. 11 6. The services that Mr. Days promised to provide were also “used primarily for personal . . . purposes” by plaintiffs E VA. CODE ANN. § 59.1-198. “Personal purposes” are those which are not commercial in nature. Compare Daughtrv v. Grav’s Bodv Shop, lnc., No. 12 CL09-2973 79 Va. Cir. 539, 2009 WL 7416523, at *2 (Va. Cir. Ct. Nov.'25, 2009), M RML Corp. v. Lincoln Window Prod., Inc., No. CL03-l885, 67 Va. Cir. 545, 2004 WL 3568223, at *11 (Va. Cir. Ct. Dec. 3, 2004). §§ also ln re All Pending Chinese Drvwall Cases, d No. CL09-3105, 80 Va. Cir. 69, 2010 WL 7378659, at *12-13 (Va. Cir. Ct. Mar. 29, 2010); Bindra v. Michael Bowman & Assocs., Inc., No. 191866, 58 Va. Cir. 47, 2001 WL 1829999, at *2 (Va. Cir.. Ct. Sep. 19, 2001). Plaintiffs sought legal counsel from l\/Ir. Days for claims related to “immigration status, divorce proceedings, hostile work environment, and employment discrimination” - all personal legal matters for non-commercial purposes _S_e_e_ LQyQ_z Am. Compl.11 14; Mye_d Am. Compl.1111 54-55. 3 Even if the language defining “consumer transaction” was ambiguous, the legislative intent in passing the VCPA leads the Court to conclude that the Virginia General Assembly intended for this type of transaction to be included within the auspices of the statute. The Virginia General Assembly established the VCPA to “be applied as remedial legislation to promote fair and ethical standards of dealing between suppliers and the consuming public.” VA. CODE ANN. § 59.1-197. According to the Virginia Supreme Court, the VCPA’s stated statutory intent is particularly significant because “[t]he legislature seldom chooses to expressly direct the courts how to apply a statute. When it does so we must pay special attention to that choice and ensure that it is given full effect. The General Assembly chose to include such direction in the VCPA . . . . We construe remedial legislation liberally, in favor of the injured party.” Ballagh v. Fauber Enters. Inc., 773 S.E.2d 366, 368 (Va. 2015) (citing VA. CODE ANN. § 59.1-197). 3 ln making this determination, the Court need not decide whether all legal services qualify as consumer transactions under the VCPA, but rather only that the legal services in this case so qualify. 13 Construing the statute liberally in favor of plaintiffs the Court concludes that the VCPA extends to the “legal services” allegedly provided here. The Court concludes that the Virginia Supreme Court would not agree with the conclusion of the two Virginia Circuit Court judges if this case were to come before it. The plain meaning of the VCPA explicitly encompasses this type of consumer transaction, and its inclusion would more effectively realize the statute’s legislative intent. C. Exemptions CAIR argues that even if the legal services at issue qualify as a “consumer transaction,” they are exempt under the statute. lt again cites Oberto v. Grogan, 88 Va. Cir. 188, 2014 WL 8'383045, at *2. ln that case, the Circuit Court first found that legal services “do not fit the VCPA’s definition of consumer [transaction].” ld. at *2 (citing Bd. of Dirs. of the Port Roval Condo. Unit Owners’ Ass’n v. Crossland Sav. FSB, 1989 Va. Cir. LEXIS 80, 15 Va. Cir. at 241). lt also concluded that even if it did, the VCPA would be preempted by other law under which attorneys are licensed to practice law. § § at *2. § Ls_o_ Caruth v. Clark, No. 16-0149, 2017 WL 1363314, at *5-6 (E.D. Va. Apr. 12, 2017) (reasoning that the VCPA “comprehensive licensing” exemption for attorneys applies to dentists). The Court disagrees The VCPA expressly excludes from its reach certain transactions, including those provided by “[b]anks, savings institutions credit unions, small loan companies, public service corporations, [and1 mortgage lenders,” among others §e§ VA. CODE ANN. § 59.1-199(D). Legal services, however, are not listed among these express exclusions The VCPA also exempts “[a]ny aspect of a consumer transaction which aspect is authorized under laws or regulations of [the1 Commonwealth [of Virginia] or the United States” w VA. CODE ANN. § 59.1-199(A). ln interpreting this provision, the Virginia Supreme Court 14 has distinguished between those consumer transactions that are “authorized” and those that are “regulated.” E l\/lanassas Autocars, lnc. v. Couch, 645 S.E.2d 443, 447 (Va. 2007). The Virginia Supreme Court has ruled that Section 59.1-199(A) “exempts only those aspects of a consumer transaction that are ‘authorized.’ Authorized actions are those sanctioned by statute or regulation.” E. ln so ruling, the Virginia Supreme Court declined to extend the exemption to other aspects of a consumer transaction “on the sole ground [that they are] regulated by other statutory provisions and regulations.” l_d. This Court must draw the same distinction CAIR asserts that “the VCPA is preempted because both rules of Virginia Supreme Court and Virginia State Bar regulate legal services.” §§§ Mot. at 10. To support its contention, CAlR points to a statute that governs the “practice of law” and the licensing of attorneys to practice law. VA. CODE ANN. § 54.1-3900 wi But as the Supreme Court of Virginia has observed, the word “regulated” is not synonymous with the word “authorized.” E Manassas Autocars, lnc. v. Couch, 645 S.E.2d at 447. To qualify for the VCPA exemption, the provision of the legal services at issue here must have been authorized under some regulation or statute. _S_e§ i_c_l. at 447. While the practice of law by a licensed attorney is authorized, the unauthorized practice of law is by definition not “authorized” by law or regulation To the contrary, under the Rules of the Virginia Supreme Court and at least one other statute, the practice of law by an unlicensed non-lawyer is expressly prohibited. § VA. SUP. CT. R. 6:1 PRACTICE OF LAW e_t M, (l\/lar. l, 2018) (“No non-lawyer shall engage in the practice of law in the Commonwealth of Virginia or in any manner hold himself out as authorized or qualified to practice law in the Commonwealth of Virginia except as may be authorized by rule or statute.”); VA. CODE ANN. § 54.1-3 904 (“Any person who practices law without being authorized or licensed shall be guilty of a Class 1 misdemeanor.”). 15 Mr. Days misrepresented himself as a lawyer and promised to assist plaintiffs with their legal matters in his capacity as CAlR’s “resident attorney.” l\/lr. Days was riot licensed to practice law, and thus the legal services he provided to plaintiffs were categorically not authorized under Virginia Supreme Court rules and at least one statute governing the licensed practice of law. This exemption, therefore, does not preclude the VCPA from applying to the legal services at issue.4 lV. CONCLUSION For the reasons set forth in this Opinion, the Court will deny CAlR’s motion for partial summary judgment with respect to plaintiffs’ VCPA claim. An Order consistent with this Opinion shall issue this same day. SO ORDERED. PAUL L. FRIEDl\/IAN United States District Judge DATE: q1 19 l\€ 4 The parties did not identify any separate statute or regulation that authorizes the provision of legal services by a non-lawyer or legal service entity. 16