Professional Documents
Culture Documents
No. 13-2491
JEREMY MARKS,
Plaintiff - Appellant,
v.
THOMAS DANN,
Defendant Appellee,
and
NATHAN CUMMINGS; CARLO DINALLO; STANISLAV LICUL; MAXTENA,
INC.,
Defendants.
Appeal from the United States District Court for the District of
Maryland, at Greenbelt.
Deborah K. Chasanow, Senior District
Judge. (8:13-cv-00347-DKC)
Argued:
December 9, 2014
Decided:
the
ARGUED:
John Da Grosa Smith, SMITH HORVATH LLC, Atlanta,
Georgia, for Appellant.
Julia Doyle Bernhardt, OFFICE OF THE
ATTORNEY GENERAL OF MARYLAND, Baltimore, Maryland, for Appellee.
ON BRIEF:
Matthew A. Horvath, SMITH HORVATH LLC, Atlanta,
Inc.
(Maxtena)
is
promising
have
been
engaged
in
Maryland-based
serial
litigation
over
the
In the complaint
Venture
Fund
(MVF),
Maryland
state
agency
dilute
his
valuation.
as
stake
members,
the
company
at
an
artificially
low
defendant
director.
in
Thomas
Dann
(Dann),
the
MVFs
managing
his
own
fiduciary
duties
to
Maxtena
and
that
Dann
was
entitled
to
immunity
from
personal
liability under the Maryland Tort Claims Act (MTCA), Md. Code
Ann., Cts. & Jud. Proc. 5-522 (West 2000).
and
within
the
scope
of
their
official
duties.
The
scope-of-duty
exception
to
the
MTCA
and
dismissed
the
Markss remedy for the MVFs alleged misconduct was against the
state, not against Dann in his personal capacity.
I.
A.
Marks left his position at Maxtena in July, 2010.
About
one year after what Marks alleges was his ouster, in April,
2011, Maxtena filed suit against Marks in the district court,
alleging
that
Marks
had
surreptitiously
founded
competing
In the Maxtena
and
valuation
settlement
discussions.
discovery
It
was
intended
through
that
to
facilitate
discovery
that
regarding
potential
early-stage
investment
by
the
MVF
in
into
equity,
from
Maxtena.
If
the
MVF
were
to
of
board
the
members
MVF
the
option
Transaction,
and
to
reverse
regain
the
their
dilutive
controlling
alleges
that
this
stock-options
grant
was
intended
to
The
MVFs
offer
as
proposed
by
Dann
was
not
accepted;
for a more favorable options pool, but did not seek a higher
valuation for the company.
B.
Marks filed his complaint on February 1, 2013, alleging
that the MVF Transaction was an elaborate scheme intended to
dilute his stake in the company and provide Maxtena with an
artificially
low
valuation
to
anchor
the
ongoing
settlement
alleges that Licul and the other members of the Maxtena board
negotiated for themselves, rather than Maxtena, in breach of
their
fiduciary
duties.
Those
claims
against
Licul
and
the
In
2013,
allegations.
in
which
Dann
they
denied
separately
filed
the
a
substance
motion
to
of
Markss
dismiss
the
that
the
claims
against
him
in
his
individual
capacity
were
the district court held that Markss claims against Dann were
barred
by
the
MTCA
because
the
complaint
did
not
plausibly
8:13-cv-00347-DKC,
(D.
Canvassing
purposes
2013
extensive
of
the
WL
8292331
Maryland
MTCA,
the
case
law
district
Md.
July
defining
court
24,
2013).
malice
found
that
for
even
boards
conflict
to
gain
substantial
ownership
advance
the
MVFs
legitimate
commercial
interests.
The
district
court
also
rejected
Markss
alternative
theory
that
Danns actions were beyond the scope of his role at the MVF, an
argument the court found completely lacking in factual support
and contradicted by the complaints allegations that Dann acted
to secure a stake in Maxtena for the MVF at a below-market
price.
Marks did not seek reconsideration of the district courts
decision or leave to amend.
of
the
district
courts
dismissal
as
final
and
appealable
II.
A.
We review de novo the district courts partial dismissal of
Markss
action
under
Rule
12(b)(6).
Wag
More
Dogs,
LLC
v.
Agency,
745
F.3d
131,
136
(4th
Cir.
2014).
To
than
plead
facts
that
are
9
merely
consistent
with
defendants liability.
(2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 557
(2007)).
Rather,
the
pleaded
facts
must
state
claim
to
gross
negligence,
immunity.
2000).
and
for
which
the
State
[has]
waived
that
in
the
ordinary
case,
the
MTCA
substitutes
the
Maryland
torts.
officials
for
intentional,
as
opposed
to
negligent,
Id.
from
suit
Id. at 307.
under
5-522(b),
then
under
the
MTCAs
or
she
statute.
complies
Id. 2
with
the
procedural
requirements
of
the
lie
against
state
official
in
his
or
her
personal
Because
Dann
specifically
designed
the
MVF
In
response, Dann argues that there was nothing improper about his
desire to achieve the best possible economic outcome for the
MVF, and that there is no support in the complaint for Markss
theory that he colluded with the Maxtena board to purposefully
harm Marks.
Read
fall
short
of
what
is
required
to
show
malice
or
12
1.
For purposes of the malice exception to MTCA immunity, a
state officials conduct is malicious if it is characterized
by
evil
or
wrongful
motive,
intent
to
699,
omitted);
714
see
(Md.
also
2007)
Lee,
863
(citations
A.2d
at
injure,
knowing
and
31112
quotation
marks
(characterizing
conduct
was
objectively
unreasonable,
but
instead
725 A.2d 549, 55759 (Md. 1999) (contrasting 1983 and statelaw malice standards).
showing
that
an
official
acted
with
an
evil
motive
to
the
is
district
seldom
court
admitted,
explained,
need
this
not
be
wrongful
proven
by
motive,
direct
particularly
difficult
because
of
the
inherently
14
difficult
task
of
circumstantial allegations).
establishing
intent
through
But
570; see also Postelle, 694 A.2d 53436; New Summit Assocs. L.P.
v. Nistle, 533 A.2d 1350, 1357 (Md. Ct. Spec. App. 1987).
This
is
where
Markss
complaint
falls
critically
short.
MVF
Transaction
not
for
the
purpose
of
benefitting
his
conduct
was
driven
by
something
other
than
ordinary
to
the
detriment
of
Maxtena
and
Marks.
But
under
16
support
one
these
piece
of
insufficient
direct
allegations
evidence
Marks
purported
to
provides
show
the
Like
Dann
was
motivated
by
anything
other
than
desire
to
context,
is
anything
more
than
factual
description
of
Even giving
and
equally
important,
the
complaint
lacks
any
53436.
Dann
conceded
transaction.
more
than
was
necessary
to
complete
the
rather
controversy.
than
the
result
of
legitimate
commercial
Id. at 534.
2.
Danns
conduct
actions
outside
the
fall
within
scope
of
an
5-522(b)s
officials
exception
public
for
duties.
is
undertaken
for
reasons
of
personal
ambition
or
coterminous
with
common
law
of
respondeat
superior).
As
to
insists
that
Dann
secured
an
advantageous
bargain for the MVF; by all accounts, Dann did quite well by his
employer.
as
breach
of
fiduciary
duty
by
definition
cannot
be
reading
of
the
scope-of-immunity
We cannot adopt
exception
that
would
We do
intentionally
employment
so,
exceptions
to
because
the
the
MTCA
malice
require
and
significantly
exceptional,
official
more
See Lee,
case
immunity
scope-of-
under
protects
the
MTCA,
Dann
from
in
which
suit
in
broad
his
state-
personal
capacity.
III.
Marks
documents,
contends
not
that
presented
certain
with
additional
his
original
allegations
complaint,
and
would
allow him to show Danns personal animus toward him, and thus to
meet the malice standard under the MTCA.
materials.
those
new
facts
Instead,
and
without
allegations
explanation,
along
with
he
provided
transcripts
of
20
The district
on
to
excerpts.
review
the
additional
allegations
and
deposition
Cf.
Equal Rights Ctr. v. Niles Bolton Assocs., 602 F.3d 597, 60203
(4th Cir. 2010) (a district court may deny leave to amend if
amendment would be futile).
Although he never moved for leave to amend in the district
court,
Marks
now
argues
that
the
district
court
erred
by
Cir.
see
also
Cozzarelli,
549
F.3d
at
63031
conscientious
review
of
Markss
The district
proffered
materials,
21
consider
the
merits
of
the
district
Accordingly, we do
courts
futility
determination, holding only that the court did not abuse its
discretion by failing to provide for amendment in the absence of
a motion to amend and in dismissing Markss claims against Dann
with prejudice.
IV.
For the reasons stated above we affirm the district courts
dismissal of Counts II and III of the complaint.
AFFIRMED
22