Bile v. RREMC, LLC Denny's Restaurant et al, No. 3:2015cv00051 - Document 85 (E.D. Va. 2016)

Court Description: MEMORANDUM OPINION. Signed by District Judge Robert E. Payne on 8/24/2016. (jsmi, )

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Bile v. RREMC, LLC Denny&#039;s Restaurant et al Doc. 85 IN THE UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF VIRGINIA Richmond Division AMANGOUA J. BILE, Plaintiff, v. Civil Action No. 3:15cv051 RREMC, LLC, and DENNY'S CORPORATION, Defendants. MEMORANDUM OPINION This matter is before the Court on a set of cross-motions: Defendants' MOTION FOR SETTLEMENT ENFORCEMENT (Docket and Plaintiff's MOTION TO ENFORCE SETTLEMENT AGREEMENT No. 54) . For the SETTLEMENT reasons ENFORCEMENT stated below, (Docket No. Defendants' 51) will be Plaintiff's MOTION TO ENFORCE SETTLEMENT AGREEMENT No. 51) (Docket MOTION FOR granted and (Docket No. 54) will be denied. PROCEDURAL HISTORY The current dispute arises out of an employment discrimination action filed by Amangoua J. Bile ("Bile") against RREMC, LLC and Denny's Corporation (collectively, "Defendants"). (Compl., ECF No. 1). The case was referred to a Magistrate Judge for settlement discussions. Conference, (ECF Nos. 23, 24). At the Settlement Bile was represented by Uduak Ubom Ubom Law Group, ("Ubom") of the and Defendants were represented by Olaolowaposi Dockets.Justia.com Oshinowo P.C. ( "Oshinowo") and Vij ay Mago ("LeClairRyan"). Settlement Agreement On July 21, (Def.'s Ex. 1) ("Mago") 2015, the of LeClairRyan, parties signed a ("the Settlement Agreement") which stated in relevant part that: [w] ithin fifteen (15) business days of the Effective Date, RREMC shall pay and Bile shall receive a one-time lump-sum of SIXTY FIVE THOUSAND DOLLARS AND 00/100 ( $ 65, 000. 00) ("Consideration") , made payable to Bile. This Consideration shall be paid as follows: ( 1) TWO THOUSAND DOLLARS AND 00/100 ($2,000.00) reflected on a W2 as wages; (2) SIXTY-THREE THOUSAND DOLLARS 00/100 ($63,000.00) reflected on a 1099 as compensatory damages. This Consideration shall reflect compensatory damages for Bile's claims and shall not be subject to withholdings by RREMC. Bile shall file with the United States District Court for the Eastern District of Virginia a Stipulation of Dismissal, with prejudice, except that the Court shall retain jurisdiction to enforce the terms of this Agreement. Pursuant to Kokkonen v. Guardian Life Insurance Co. of America, 511 U.S. 375 (1994), the Stipulation of Dismissal shall explicitly reserve such jurisdiction in this Court. The Stipulation of Dismissal is to be filed within ten (10) business days of the execution of this Agreement. (Settlement Agreement at 1-2; Def.'s Post-Hrg. Mem. 4-5). As fact, discussed the litigation, email in used more by detail Bile's in the counsel "ubomlawgroup@yahoo.com," was Court's during findings the course of of compromised. Def.'s Post-Hrg. Mem. 2, 7-8, 18; Pl.'s Post-Hrg. Resp. 7-9). On 2 July 29, 2015 at 6:40 p.m., the third party that compromised the account sent an email from ubomlawgroup@yahoo.com to Oshinowo at LeClairRyan, instructing that the payment required by the Settlement Agreement be wired to a Barclay's account, purporting to be Bile's, 18; Pl.' s in London. Post-Hrg. LeClairRyan' s internal Def.'s Resp. Post-Hrg. for a wire 2, 7-8, initiated Oshinowo 7-9) . procedures Mero. transfer in the amount of $63,000.00 to be dispatched to the Barclay's account, and LeClairRyan initiated that transfer. 9). Meanwhile, Defendant $2,000.00-less-witholding address. (Def.'s RREMC, and LLC mailed Post-Hrg. Mem. (Def.' s Post-Hrg. processed it to 10) . a Bile's Mem. check for residential received Bile $2, 000. 00-less-wi tholding check without incident. (Def.' s the Post- Hrg. Mem. 10). On July 31, 2 015, Bile's counsel, Ubom, inquiring about the remaining $63,000.00. called (Def.'s Post-Hrg. Mem. 6). At that point, Oshinowo learned that the July 29, p.m. email Oshinowo 2015 6:40 from ubomlawgroup@yahoo.com had not originated with Ubom, and LeClairRyan unsuccessfully attempted to claw back the wire transfer. Defendants Bile refused refused to to initiate dismiss another this action, $63,000.00 and payment. (Def.'s Post-Hrg. Mem. 12, 25; Pl.'s Post-Hrg. Resp. 13-14). When the Magistrate Judge learned ordered the parties to brief the matter 3 of the situation, (ECF Nos. 27-30, he 32-39) and initiated a criminal investigation with the United States' Attorney's Office for the Eastern District of Virginia. 40). In the course of this briefing, first time email, that: (1) purportedly on July from settlement funds in LeClairRyan 27, Bile, the subsequently Defendants learned for the 2015, Ubom had directing same (ECF No. the Barclay's transferred the received an deposit account of to $63,000.00; the which (2) Ubom had called Bile to determine whether the email was not genuine, and Bile had confirmed that the email was not genuine; Ubom had deleted the email without opposing counsel, or the Court. informing and (3) Defendants, (Def.'s Post-Hrg. Mem. 20; Pl.'s Post-Hrg. Resp. 2). The parties were unable to resolve the matter. The dispute was then presented to enforce the motions to the hearing. {ECF Nos. 46, 67, Court, which settlement 69). set a and for schedule an for evidentiary The parties filed cross-motions to enforce the Settlement Agreement and presented evidence. (ECF Nos. 51, 54). The briefing reasonableness of in this each case side's originally actions. centered Following on inquiry the from the Court respecting the issues to be heard at the evidentiary hearing, the parties presented additional arguments rooted in substantial performance, material breach, and certain aspects of the Uniform Commercial Code ("U.C.C."). 4 At the evidentiary hearing, Bile also unexpectedly presented an argument that the Settlement Agreement did not correctly reflect the intent of the parties. Post-trial briefing followed. At the evidentiary hearing, Defendants presented the testimony of David Melczer ("Melczer"), accepted by the Court as an expert in carried out information the wire Defendants' the transfer position transmitting technology, that and in question, (Def.'s in Lemmert, Post-Hrg. support who of the reasonably acted Oshinowo $63,000.00. James in Mem. 7; Pl.'s Post-Hrg. Mern. 10-11). Bile presented his own testimony and that of Oshinowo Settlement in support Agreement of was the not Bile's position enforceable as that: ( 1) the written; and (2) Oshinowo acted unreasonably in transmitting the $63,000.00. FINDINGS OF FACT In light of the evidence and testimony presented at evidentiary hearings of June 16 and 22, 2016, the the Court finds the following facts by a preponderance of the evidence. 1 A. The Parties Signed A Valid Settlement Agreement On July 21, 2015, the parties signed a valid and binding Settlement Agreement which provided that Bile was to dismiss the action within ten days of execution and that Defendants were to 1 The burden required Conclusions of Law. is discussed 5 in greater detail in the pay Bile within fifteen days of execution. (Def.' s Ex. 1; Def.' s Post-Hrg. Mem. 4-5). Bile's assertion alternate terms, that namely, the parties is stated, barred by the to parol (Pl.' s evidence rule. Post-Hrg. As Bile during direct examination by his own counsel, discussion of the purported alternate terms the signing Agreement. parties' introduce that Bile intended that Defendants pay him before he would dismiss the case 5), 2 intended the Settlement Mero. himself the only occurred prior 2, to Pl.'s Post-Hrg. Resp. 5-7). Under the parol evidence rule, evidence of inconsistent prior oral agreements is inadmissible to vary or augment the terms of an agreement where, in question is a written, integrated as here, agreement. 3 the contract Restatement 2 Defendants deny that any such agreement to vary the terms of the Settlement Agreement took place. (Def.' s Post-Hrg. Mem. 56). It is unnecessary to evaluate credibility, because evidence of prior inconsistent terms is barred under the parol evidence rule. Defendants also presented uncontroverted testimony to the effect that the order of performance was a material term that was specifically bargained for. (Def.'s Post-Hrg. Mem. 5-6). Such evidence related to an argument made in pre-hearing briefings that Bile materially breached the Settlement Agreement by seeking to return to work for Defendants and threatening to "appeal" in the time between execution on July 21, 2015 and LeClairRyan's initiation of the wire transfer on July 29, 2015. (E.g., Def.'s Post-Hrg. Mem. 5-8, 15-16, 25). The Court finds it unnecessary to consider that argument to reach a decision in this case, and will not dwell further on that testimony or issue. 3 § The Court finds, pursuant to Restatement (Second) of Contracts 213 (b) that the Settlement Agreement is such an integrated 6 (Second) of (Def.'s Contracts Ex. § 1 ("This at 5) 213 ("Restatement") ; 4 see (1981) Agreement understanding between the parties. constitutes the also entire The Parties have not relied on any oral statements that are not included in this Agreement. Any modifications ... must be in writing and signed by Bile and an authorized employee or agent of [Defendants]."). Bile's argument that such statements should be admitted as evidence of the "course of the dealings of the parties" are unavailing because extrinsic evidence of prior or contemporaneous dealings are admissible only to clarify ambiguous terms in an integrated agreement, agreement. Co., not to contradict Doswell Ltd. 251 Va. 215, 222, clear P' ship v. 468 S.E.2d 84, Co. v. Coutinho, Caro & Co., terms in an integrated Virginia Elec. 88 (1996); 617 F.2d 355, 357 & Power Brunswick Box (4th Cir. 1980). The timing provisions in the Settlement Agreement are perfectly clear and neither require necessary no nor clarification. admissible to Hence, parol clarify the evidence is Settlement Agreement. 5 contract, examining the plain language of the "Entire Agreement" clause. (Def.'s Ex. 1 at 5). 4 Use of the Restatement as governing law is discussed in greater detail below. 5 Neither party presented evidence of an agreement, or even discussion, made subsequent to the Settlement Agreement which would have altered the terms of the Settlement Agreement. 7 Finally, Bile's assertion that the Settlement Agreement is not valid is irreparably undermined by his own motion to enforce that same agreement. the Settlement (Docket No. Agreement, Bile 51) . Having moved to enforce cannot Agreement as written is unenforceable. 6 now assert Quite frankly, that the the Court cannot perceive how, having made the motion to enforce, Bile and his counsel can also argue in any good faith that the Settlement Agreement is unenforceable. B. Ubom Received a Fraudulent Email On July 27, 2016, ubomlawgroup@yahoo.com, Ubom's received an email business email from an account, aoi.com account, which was visually similar to Bile's legitimate aol.com address. (Def.' s Post-Hrg. Mem. 20, 22; Pl.' s Post-Hrg. Resp. 2) . 7 That email requested that the $65,000.00 settlement be wired (Def.'s Post-Hrg. Mem. 26). As discussed at footnote Defendants' early payment was not a subsequent alteration. 8, 6 Al though Bile's conduct does not quite rise to the level of judicial estoppel because Bile did not state an inconsistent theory in prior litigation, e.g., Lowery v. Stovall, 92 F. 3d 219, 224 (4th Cir. 1996), Bile's filing of the motion to enforce the Settlement Agreement on April 11, 2016 (Docket No. 51) greatly undermines his present claim (Pl.'s Post-Hrg. Mem. 2, 57) that the parties did not intend the Settlement Agreement as written to be binding. Bile's motion quite clearly reflects that Bile intended the Settlement Agreement to be enforceable as written. 7 As discussed in greater depth at the conclusion of the findings of fact, the aoi. com email originated with a malicious third party. 8 to a particular Barclay's account in Bile's name in London. (Def.'s Post-Hrg. Mem. 20; Pl.'s Post-Hrg. Resp. 2). Ubom called Bile to ask if Bile had sent that email; Bile informed Ubom that he had not. (Pl.' s Post-Hrg. Resp. 2) . Ubom deleted the email without notifying Defendants, Defendants' counsel, or the Court. (Def.'s Post-Hrg. Mem. 1-2, 10, 22; Pl.'s Post-Hrg. Resp. 2). Bile's briefing states that neither Bile nor his attorneys had any reason compromised or (Pl.' s and "to believe that Post-Hrg. there Resp. dispositively, 1, the was Settlement Agreement potential 20) . That undermined briefing that "[o] n July 27, by fraudulent assertion the is had been activity." irreparably, statement in Bile's 2015 Plaintiff's counsel received what he considered a fraudulent email" (Pl.'s Post-Hrg. Mem. 20) and the repeated statements in Bile's briefing that Ubom deleted the July 27, 2015 regarding fraud. aoi. com email (Pl.' s because Post-Hrg. Mem. of 2-3, various bulletins 20) . Moreover, the undisputed record shows that Ubom told Bile about the fraudulent email. The Court finds that knowledge that, on July 27, targeting settlement this both 2015, for a Ubom and Bile had actual a malicious third party was fraudulent transfer to an offshore account that did not belong to Bile. The Court further finds that both Ubom and Bile knew the email account of the Ubom Law Group was implicated in that fraudulent activity. 9 C. Bile Pushes for, and Defendants Send, Early Payment After signing the Settlement Agreement on July 21, 2015, Bile began hounding Defendants for an accelerated payment, even threatening to withdraw from the Settlement Agreement if he did not receive payment by July 31, 16, work 25; Pl.' s for Post-Hrg. Defendants Resp. (which Settlement Agreement), 2015. 6). was (Def.' s Post-Hrg Mem. 15- Bile attempted to return to explicitly forbidden by the expressed that he was dissatisfied with the amount of the consideration, and expressed that he wanted to "appeal" the Settlement Agreement. (Def.'s Post-Hrg. Mem. 6, 15; Pl.'s Post-Hrg. Resp. 1, 7, 16, 26). Defendants that the payment capitulated payment on July date 29, be 2015, in the face advanced, of and understanding Bile's agreed that insistence to Bile initiate wanted the consideration paid as quickly as possible and might attempt to rescind the agreement if he did not July 31, 2015. 8 (Def.' s Post-Hrg. 8 receive the $63, 000. 00 by Mem. 5-8, 15-16, 25; Pl.' s Contrary to Plaintiff's argument (Pl.'s Post-Hrg. Mem. 6-7, 10, 15, 17, 27), this capitulation did not represent an amendment to the Settlement Agreement which would render the Settlement Agreement in evidence invalid. The Settlement Agreement required Defendants to pay within 15 days of July 21, 2015 (Def.'s Ex. 1 at 1-2). Thus, an early payment was clearly permitted by the Settlement Agreement. (Def.'s Post-Hrg. Mem. 5). Definitively, Bile concedes that "[p]aying the funds on July 31, 2015 was not outside the terms of the Agreement, because the Defendant had a duty to pay between July 21 and August 11, 2015 within the terms of the Agreement." (Pl.' s Post-Hrg. Resp. 16). Thus, making an early payment did not amend the contract. 10 Post-Hrg. Resp. 1-2, 4, 6, 9). Defendants acted as they did to ensure that the Settlement Agreement was effectuated. On July 29, the phone, $63,000.00 and sent 2015, Ubom and Oshinowo discussed payment over agreed by orally that LeClairRyan two and one checks one for for $2,000.00-less- withholding sent by RREMC, LLC - would be sent by FedEx to Bile at his residence in Virginia. Post-Hrg. Resp. 1-2). (Def.'s Post-Hrg. Mem. Oshinowo expressed that 7-8; it Pl.'s might be difficult to process the $63,000.00 check to Bile as quickly as Ubom and Bile desired. Hrg. Mem. 9). (Def.' s Post-Hrg. Mem. 7-8; Pl.' s Post- Ubom and Oshinowo agreed, orally, that Ubom would send confirmation of Bile's residential address to Oshinowo by e-mail. (Def.'s Post-Hrg. Mero. ubomlawgroup@yahoo.com email, address to Oshinowo by did email at in 4: 33 using the confirm Bile's home Ubom, 7-8) . fact p.m. on July 29, 2015. (Def.'s Post-Hrg. Mern. 6-8). Subsequently, received that the account. another at 6:40 email consideration from be p.rn. on July 29, 2015, ubornlawgroup@yahoo. corn, wired (Def.'s Post-Hrg. Mern. 2, to a particular Oshinowo requesting Barclay's 7-8). 9 Oshinowo believed that this email and a follow-up email that arrived shortly thereafter 9 This Barclay's account was identical to the one identified in the fraudulent July 27, 2015 aoi.corn account sent to ubornlawgroup@yahoo.com. 11 were sent (addressing by Ubom Oshinowo because by a of: (1) shortened the form of "Posi," and Mago by Mago's given name) of address used in Ubom' s the email (3) the was consistent email payment; 11 (4) reiterated Ubom' s Bile and family name, was typical of the form previous emails; with his salutation ( 2) the content of error-prone typography; 10 Ubom's demand for urgent instructions by email were consistent with Ubom's prior statement email; and (5) atypical by phone that he would confirm details via the attorneys in the case had communicated both by phone and email throughout the case. (Def.' s Post-Hrg. Mem. 8, 18; Pl.'s Post-Hrg. Resp. 7, 9) . 12 Melczer also testified that the header information in the email demonstrated that the email authentically came from Yahoo's servers, meaning that: (1) the 10 In pre-hearing briefs, Bile argued that Oshinowo should have been on notice that the email came from a malicious third party because of the numerous typographical emails in the emails sent the evening of July 29, 2015. The Court, having read Ubom' s briefing and several emails genuinely sent by Ubom, concurs with Defendants that the typographical errors are characteristic of Ubom's practice, and made it more, rather than less, reasonable for Oshinowo to believe that the emails sent by the malicious third party actually originated with Ubom. (E.g., Def.' s PostHrg. Mem. 8) . 11 As Lemmert testified, a wire transfer was faster than processing a check for $63,000.00. (Def.'s Post-Hrg. Mem. 9). 12 Bile "failed to present any evidence to impeach or rebut Defendants' evidence regarding the authenticity of the e-mail requesting a wire transfer, and the reasonableness of Mr. Oshinowo' s assessment based on the surrounding circumstances." (Def.'s Post-Hrg. Mem. 8-9). 12 email actually came from ubomlawgroup@yahoo.com and was sent by someone with access to the ubomlawgroup@yahoo.com account; ( 2) nothing about the email's header information would have alerted Oshinowo that the email was sent by from someone other than Ubom or the Ubom Law Group; 13 and (3) industry-standard email security filters email. The would not have alerted Oshinowo Court finds Melczer' s of this 18; Pl.'s Post-Hrg. Resp. (Def.'s Post-Hrg. Mem. 7, 8) . 14 expert to opinions be to wary be reliable and credible. Oshinowo, the email believing that the email came from Ubom and that reflected Ubom and Bile's desire payment by the most expeditious method, internal procedures the account Post-Hrg. rebut, the specified . Resp. that: for ( 1) instructions 10}. sending a ( Def . ' s Post - Hr g . Lemmert testified, the ubomlawgroup@yahoo.com; July (2) 29, the 2015 Bile receive initiated LeClairRyan's $63,000.00 the wire transfer was in that wire Mero . and transfer to 9, 18 -19 ; P1 . ' s Plaintiff did not initiated according to 6:40 recipient p.m. name on email from the wire 13 The ubomlawgroup@yahoo.com account is shared by all employees of the Ubom Law Group. 14 "(T]here is no factual dispute that Defendants had no ability or reason to believe the requests set forth in the July 29, 2015 e-mail were anything other than legitimate requests from opposing counsel - coming from precisely the same email address that opposing counsel used to communicate with Defendant seven prior to the conunencement of this action." (Def.' s Post-Hrg. Mem. 2). 13 transfer order was Amangoua J. industry standard practices, the recipient name on the Bile; the and (3) per banking receiving bank confirmed that wire transfer order corresponded to the name of the holder of the recipient account. (Def.' s Hrg. 10) . 9, Mem. 18-19; authenticated, evidence, receipts transfer July and for 29, Pl.' s Defendants showing $63, 000. 00 2015 6:40 Post-Hrg. Mem. 9, completed wire the instructions in July 31, Resp. successfully that according p.rn. introduced LeClairRyan to the Lemmert completed instructions ubornlawgroup@yahoo.com email. into a wire in the (Def.'s 18-19). Bile does not dispute that LeClairRyan transfer the July ubomlawgroup@yahoo.com. On Post-Hrg. Post- for according 2015 29, $63, 000. 000 p.m. 6:40 to email the from (Pl.'s Post-Hrg. Resp. 1). 2015, Bile called Ubom to complain that, although Bile had received by mail a check for $2, 000. 00-lesswitholding, the remaining $63,000.00 had not been delivered. Ubom raised the matter with Oshinowo, who informed Ubom that the money had been wired as p.rn. instructed by the July 29, email from ubomlawgroup@yahoo.com. anyone in his office sent the July 29, from ubomlawgroup@yahoo.com. 14 2015, 6: 40 Uborn denied that he or 2015, 6:40 p.m. email D. Aftermath Following the discussion with Ubom, Oshinowo and LeClairRyan immediately attempted to recall the $63,000.00 wire transfer, but were unsuccessful. On July 31, through 2015, LeClairRyan $63,000.00 payment; payment. (Pl.'s Oshinowo informed Ubom that or otherwise, would not make another Defendants have not made another $63,000.00 Post-Hearing Resp. 1, 13-14). Ubom Oshinowo that Bile would not dismiss the action; dismissed the action. Hrg. Mero. Defendants, informed Bile has not (Def.' s Post-Hrg. Mero. 12, 25; Pl.' s Post- 2). The dispute came before the Magistrate Judge, who ultimately ordered a criminal investigation by the United States Attorney for the Eastern District of Virginia. While the learned dispute for received a to the the was before first time the Magistrate that on July (Docket No. Judge, 27, 40) . Defendants 2015 Bile had fraudulent aoi. com email requesting a wire transfer same Barclay's address to which LeClairRyan wired the $63,000.00. The Court understands, the same malicious party and the parties seem to agree, who sent the July 27, 2015 that aoi. com email to ubomlawgroup@yahoo.com also sent the July 29, 2015 6:40 p.m. email from ubomlawgroup@yahoo.com to Oshinowo. further understands, and the parties seem to agree, The Court that this malicious third party controlled the Barclay's account to which 15 both emails $63, 000. 00, withdrew ref erred and to which LeClairRyan wired the and that this malicious third party transferred or the $63,000.00 prior to LeClairRyan's claw back attempt. CONCLUSIONS OF LAW Guided by general contract principles and by the persuasive authority of Article 3 of the U.C.C., the Court concludes that Defendants substantially performed their obligations Settlement Agreement on July 29, 2015, and are under the entitled to specific performance of Bile's obligations under the Settlement Agreement. A. Burden of Proof, Jurisdiction, and Choice of Law It is well-settled that when the validity of a Settlement Agreement is questioned, of the 540-41 the standard of proof is preponderance evidence. Hensley v. (4th Cir. 2002). Alcon Labs., This case, Inc., however, 277 F.3d includes issue of both validity and performance. The parties both propose Post-Hrg. concurs Mem. 11; Pl.'s Post-Hrg. that the default is the appropriate evidence, Settlement Agreement. civil (Def.'s Resp. burden, 12) and the preponderance standard for Post-Hrg. Mem. performance 11) 535, (Def.'s Court of the of (relying a on Richardson v. Cabarrus Ct. Bd. of Educ., 151 F.3d 1030 (4th Cir. 16 Proctor & Paine, 1998); Stvens v. Abbot, 48 Supp. 836, 847- (E.D. Va. 1968)). This the 288 F. Court has Settlement jurisdiction over Agreement because disputes the arising out of continuing Court's jurisdiction was included in the Settlement Agreement from which the dispute arose. Kokkonen v. 511 ( 1994) ; U.S. 37 5, 382 Guardian Life Columbus-Am. Ins. Co. Discovery Grp. of Am., v. Atl. Mut. Ins. Co., 203 F.3d 291, 299 (4th Cir. 2000). The Settlement Agreement lacks a choice of law clause, the and parties law dispute whether federal common law or state governs an agreement settling a federal cause of action. Post-Hrg. perfectly Mem. 10; clear as Pl.' s a Post-Hrg. matter of precedent, 15 but the Court need not 15 Mem. 12) . Fourth (Def.'s This issue is not Circuit or district resolve the matter because The trend tends to be that, where a Settlement Agreement settles federal claims, it is governed by federal common law. U.S. ex rel. Ubl v. IIF Data Sols., 650 F.3d 445, 451 (4th Cir. 2011) ("The enforceability of an agreement to settle claims under the FCA is governed by federal common law" which is informed by the Restatement (Second) of Contracts) (relying on Pinchback v. Armistead Homes Corp., 907 F.2d 1447, 1453 (4th Cir.1990)); Silicon Image, Inc. v. Genesis Microchip, Inc., 271 F. Supp. 2d 840, 848 (E.D. Va. 2003) (relying largely on Gamewell Mfg., Inc. v. HVAC Supply, Inc., 715 F.2d 112, 115 (4th Cir. 1983)). However, the Fourth Circuit has recently acknowledged that the law on this matter is not absolutely clear. Swift v. Frontier Airlines, Inc., No. 15-1261, 2016 WL 80580, at *3, n. * (4th Cir. Jan. 7, 2016) (noting defendant's assertions of legal ambiguity on the choice of law issue, but ignoring the issue because state law would inform federal law regardless) . Additionally, Gamewell's analysis may have been "eroded by 17 the governing principles this case are settled contract principles exposited in both federal common law and state law. Hilb Rogal 2006 WL 5908727, an & Hobbs Co. at *11 inquiry into choice v. Rick Strategy Partners, (E.D. Va. of law is Feb. 10, 2006) Inc. , (finding that only necessary if potential sources of law lead to conflicting results) . B. Common Law Contract Principles, Supplemented with Uniform Commercial Code Rules, Provide the Most Appropriate Approach for Analyzing Entitlement to Enforce the Settlement Agreement There is no case law precisely on point for analyzing this case. and However, a combination of common law contract principles principles from conclusion that Settlement Agreement, Article Defendants and 3 of the substantially thus are U.C.C. performed entitled to compel the under the substantial performance from Bile under the Settlement Agreement. 1. Common Law Supplies Principles of Material Breach and Substantial Performance The Restatement (Second) of Contracts states that "it is a condition of each party's remaining duties to render performance that there be no uncured material failure by the other party to render Restatement any § such performance due at an 237; see also U.S. ex rel. Ubl v. earlier time." IIF Data Sols., subsequent Supreme Court cases [to the extent that it] is inconsistent with contemporary doctrine" on the role of federal common law. Morton Denlow & Jonny Zajac, Settling the Confusion: Applying Federal Common Law In Settlement Enforcement Proceedings Arising Under Federal Claims, 107 Northwestern U. L. Rev. 127, 146 & 146 n.147 (2012). 18 650 F.3d 445, 451 (4th Cir. 2011) ("When applying federal common law to contract issues, courts generally look to the Restatement for guidance."); Horton v. Horton, ,254 Va. 111, 115, 200, 203-04 breach); 767 (1997) stated (reciting common law principles of material Culpeper Reg' 1 Hosp. S.E.2d in 236, 239 Horton failure" Restatement § L. P., Jones, 64 Va. (connecting Restatement the 237). § App. common The 207, 213, law rule converse performance." "substantial is 241 cmt. d; No. v. (2015) with "material Mills, 487 S.E.2d of see also S. Auburn L.P. v. Old Auburn 24210, 2005 WL 1995433, at *5 (Va. Cir. Ct. Aug. 18, 2005); RW Power Partners v. Virginia Electric and Power Co., 899 F.Supp. provision of exchange: Bile's $63,000.00 the in 1490, 1496-97 Settlement dismissal damages (E.D. Va. 1995). Agreement of and the is action The material the in underlying exchange $2,000-less-witholding for from Defendants, and vice versa. If one party materially breached the Settlement Agreement, then that party did not substantially perform and is not entitled to compel reciprocal performance. In determining whether a failure to render performance is material, the following circumstances are significant: (a) the extent to which the injured party will be deprived of the benefit which he reasonably expected; (b) the extent to which the injured party can be adequately compensated for the part of that benefit of which he will be deprived; 19 (c) the extent to which the party failing to perform or to offer to perform will suffer forfeiture; (d) the likelihood that the party failing to perform or to off er to perform will cure his failure, taking account of all the circumstances including any reasonable assurances; (e) the extent to which the behavior of the party failing to perform or to offer to perform comports with standards of good faith and fair dealing. Restatement 241; § S. Auburn L.P., 2005 WL 1995433, at *5 (applying Restatement§ 241); RW Power Partners, 899 F.Supp. at 1496-97 (same); see also Restatement § 241 cmt. f {"A party's adherence to standards of good faith and fair dealing . . . will not prevent his failure to perform a duty from amounting to a breach failure .... Nor will his adherence from condition") . There having the effect ... of necessarily prevent his the non-occurrence of a 16 can be no question embodied in the Restatement that the common law principles (Second) of Contracts are applicable to this proceeding: the dispute is one of contract performance, and the relevant Restatement principles have been incorporated into both However, federal these common common law law and contract Virginia state principles guidance on how to resolve the facts at hand. 16 common law. provide minimal Therefore, it is "Good faith and fair dealing" is not the same concept as "ordinary care." Compare Uniform Commercial Code § 3-103(6) (defining good faith) with § 3-103(9) (defining ordinary care). 20 necessary to look further afield to related and persuasive areas of law to aid the decisional process. Article provide 3 rules assessing the of the and U. C. C. analogous propriety of and cases situations the analyzing which that are title useful conduct. parties' on Guidance 2. The U. C . C • Approach Provides Reasonableness and Performance Although Article 3 by its terms governs only negotiable instruments, contract disputes or wire transfers, 17 1991) this Tycon I Bldg. Ltd. P'ship, not Article 3 is persuasive in areas of law which it does not directly govern. Bank v. in Old Stone 946 F.2d 271, 273 (4th Cir. ("While the UCC does not of course govern the outcome of suit involving real property, both sides agree that it provides persuasive authority in these circumstances") . 18 In the absence of contract law directly on point, the Court finds that Article 3 provides guidance for the resolution of this case. U.C.C. a § fraudster, conversion 3-420 states that, where a check is intercepted by the because intended "if [a] payee check has is no cause never of action delivered to for the 17 Wire transfers are explicitly governed by Article 4 of the U.C.C., not Article 3's rules for negotiable instruments. U.C.C. §§ 3-102, 4A-104. Because the last communication legitimately sent by Ubom requested a check, however, the Court looks to Article 3 rather than Article 4 for persuasive rules. 18 The Court solicited the parties' views on whether Article 3 might be used as a persuasive authority, and both parties agreed that Article 3 is persuasive. (E.g., Docket Nos. 69, 70, 71). 21 payee, the obligation owed to the payee is not affected Since the payee's right to enforce the underlying obligation is unaffected by the fraud of the thief, there is no reason to give any additional remedy to the payee." U.C.C. U.C.C. comment goes on to note deli very when the check comes that § 3-420 cmt. 1. The "[t]he payee receives into the payee's possession, as for example when it is put into the payee's mailbox." Id. 19 Taken together, these instrument but possession, sections fails then the teach that, if a payor issues an to deliver the instrument to the payee's payor is still liable on the underlying obligation. However, §§ § 3-404 and 3-406, addressing third party fraud and depositing checks at a bank, principle that a party whose inject into this equation the failure to take ordinary results in loss must be the party to bear that loss. Per care § 3- 304, (a) If an impostor ... induces the issuer of an instrument to issue the instrument to the impostor by impersonating the payee of the instrument or a person authorized to act for the payee, an indorsement of the instrument by any person in the name of the payee is effective as the indorsement of the payee in favor of a person who, in good faith, pays the instrument or takes it for value or for collection 19 Additionally, payee." Id. " [ d] eli very to 22 an agent is deli very to the (d) With respect to an instrument to which subsection (a) applies, if a person paying the instrument or taking it for value or for collection fails to exercise ordinary care in paying or taking the instrument and that failure substantially contributes to loss resulting from payment of the instrument, the person bearing the loss may recover from the person failing to exercise ordinary care to the extent the failure to exercise ordinary care contributed to the loss. u.c.c. § 3-404 (emphasis added) . Comment 3 provides following example: Thief, who is not an employee or agent of Corporation, steals check forms of Corporation. John Doe is president of Corporation and is authorized to sign checks on behalf of Corporation as drawer. Thief draws a check in the name of Corporation as drawer by forging the signature of Doe. Thief makes the check payable to the order of Supplier Co. with the intention of stealing it. Whether Supplier Co. is a fictitious person or a real person, Thief becomes the holder of the check and the person entitled to enforce it Thief deposits the check in an account in Depositary Bank which Thief opened in the name "Supplier Co." Depositary Bank becomes the holder of the check and the person entitled to enforce the check. If the check is paid by the drawee bank, there is no breach of warranty under Section 3417 (a) (1) or 4-208 (a) (1) because Depositary Bank was a person entitled to enforce the check when it was forwarded for payment and, unless Depositary Bank knew about the forgery of Doe's signature, there is no breach of warranty under Section 3-417{a) (3) or 4-208(a) (3). Because the check was a forged check the drawee bank is not entitled to charge Corporation's account unless Section 3-406 or Section 4-406 applies. 23 the u.c.c. § 3-404. Taken together, these provisions establish a principle that a blameless party representations, is entitled to rely on reasonable even when those reasonable representations are made by fraudsters. Additionally, § 3-406 establishes that (a) A person whose failure to exercise ordinary care substantially contributes to an alteration of an instrument or to the making of a forged signature on an instrument is precluded from asserting the alteration or the forgery against a person who, in good faith, pays the instrument or takes it for value or for collection. (b) Under subsection (a}, if the person asserting the preclusion fails to exercise ordinary care in paying or taking the instrument and that failure substantially contributes to loss, the loss is allocated between the person precluded and the person asserting the preclusion according to the extent to which the failure of each to exercise ordinary care contributed to the loss. (c) Under subsection (a), the burden of proving failure to exercise ordinary care is on the person asserting the preclusion. Under subsection (b), the burden of proving failure to exercise ordinary care is on the person precluded. U.C.C. § 3-406. "Substantially contributes" "is meant to be less stringent than a "direct and proximate cause" test. U.C.C. § 3- 406 cmt. 2. "Under the less stringent test the preclusion should be easier to establish. Conduct 'substantially contributes' to a material alteration or forged signature if it is a contributing 24 cause of the alteration or signature and a substantial factor in bringing it about." Id. Notably, "ordinary ordinary case." Article care," care Those 3 and based does instead on "the circumstances not define calls for a circumstance include any what constitutes determination of of the particular applicable commercial standard. No attempt is made to define particular conduct that will constitute "failure to exercise ordinary care " Rather, "ordinary care" is defined in Section 3103 (a) (7) in general terms. The question is left to the court ... for decision in light of the circumstances in the particular case including reasonable commercial standards that may apply. U. C . C . § 3- 4 0 6 crnt . 1. Se ct ion general: " ' [ o] rdinary care' business means prevailing in observance the area in § 3-10 3 (a ) ( 7 ) is , indeed, quite in the case of a person engaged in of reasonable which the commercial person is standards, located, with respect to the business in which the person is engaged." Article 3 does, however, provide illustrative examples about checks. Case #1. Employer signs checks drawn on Employer's account by use of a rubber stamp of Employer's signature. Employer keeps the rubber stamp along with Employer's personalized blank check forms in an unlocked desk drawer. An unauthorized person fraudulently uses the check forms to write checks on Employer's account. The checks are signed by use of the rubber stamp. If 25 cashing Employer demands that Employer's account in the drawee bank be recredited because the forged check was not properly payable, the drawee bank may def end by asserting that Employer is precluded from asserting the forgery. The trier of fact could find that Employer failed to exercise ordinary care to safeguard the rubber stamp and the check forms and that the failure substantially contributed to the forgery of Employer's signature by the unauthorized use of the rubber stamp. Case #2. An insurance company draws a check to the order of Sarah Smith in payment of a claim of a policyholder, Sarah Smith, who lives in Alabama. The insurance company also has a policyholder with the same name who lives in Illinois. By mistake, the insurance company mails the check to the Illinois Sarah Smith who indorses the check and obtains payment. Because the payee of the check is the Alabama Sarah Smith, the indorsement by the Illinois Sarah Smith is a forged indorsement. Section 3-llO(a). The trier of fact could find that the insurance company failed to exercise ordinary care when it mailed the check to the wrong person and that the failure substantially contributed to the making of the forged indorsement. In that event the insurance company could be precluded from asserting the forged indorsement against the drawee bank that honored the check. U. C . C . § 3- 4 0 6 cmt . 3. In sum, the U. C . C . requires "o rdi nary care" by participants in financial transactions; the participant who fails to exercise ordinary care is liable for any losses to which his lack of ordinary care substantially contributes. Combining Services, several of these concepts, in Barrett Business Inc. v. Worker's Comp. Appeals Bd., 204 Cal. App. 26 4th 597 ( 2012), sent the court held that where: employer's claims change of address; (2) employee's address; adjuster a ( 1) employee's attorney notification (3) employer's claims adjuster sent worker's old address; party fraudulently cashed the worker's and ("where the issuer ... obligation.") of U.C.C. N.A., No. § remains ( 4) a third compensation check, employer was still obligated to pay its employee. issuer employee's employer's claims adjuster did not update compensation check to employee's the of the Id. at 600-603 does not deliver the check to the payee liable to the (relying on California's payee on the underlying statutory implementation 3-420) . 20 By contrast, in Willis v. Wells Fargo Bank, 2:11CV193, the court held that, 2012 WL 112942 (E.D. Va. Jan. 12, 2012), where an agent of a business who was also an authorized drawer on the business's account lied to the bank, but the bank adhered to Article 3 best practices and made no error of its own, the injured third party to whom a bad check was claim against given had no pertinent U. C. C. provisions, the Barrett, bank. A synthesis and Willis of yields a the rule that: if a person has an obligation to deliver a check, and does 20 Contrary to Bile's assertion (Pl.'s Post-Hrg. Resp. 20), Barrett does not stand for the proposition that a defendant is liable on any check which is not delivered to its intended recipient. Rather, Barrett more properly stands for the principle that a party which acts without ordinary care bears the loss associated with the intervention of a malicious third party. Barrett, 204 Cal. App. 4th at 603. 27 not deliver that check due to that person's own error, then that person remains liable on the underlying obligation. In this case, Defendants' application of this principle means that: agent, issued LeClairRyan, the if transfer wire pursuant to Defendants' agent's own error or Defendants' agent's lack of ordinary underlying Bile's care, then obligation. agent, Ubom, Defendants U.C.C. § the caused 3-420 remain cmt. wire 1. transfer liable on the Conversely, to be if issued pursuant to Bile's agent's own error or Bile's agent's lack of ordinary care, underlying then Bile obligation. is Id. not entitled Defendants to collect the liable remain on on the underlying obligation if the transfer of funds can be described as Defendants' agent's error rather than Bile's agent's error. 3 . Combining Common Law Con tract Principles with Applicable Precepts of Article 3 Yields a Functional Roadmap for Assessing Entitlement to Enforce the Settlement Agreement The utility of the Article 3 approach is common best law contracts aggregated by approach and the nesting Article 3 principles within Restatement § 237. This approach yields a twostep rule: duties material to ( 1) "it render failure is a condition performance by the that other party performance due at an earlier time" the parties' material of failure (or 28 each party's there to be render remaining no uncured any such (Restatement§ 237); and (2) its converse, substantial performance) shall be determined by examining whether they acted in accord with principles of ordinary care as characterized in U.C.C. § 3-404 and Accordingly, 3-406. § the Court proceeds to examine whether the parties acted with principles of ordinary care as characterized in U.C.C. C. § 3-404 and 3-406. § Bile's Agent, Ubom, Failed to Exercise Ordinary Care Bile's agent, circumstances. Ubom, That failed to use ordinary care under the failure substantially contributed to the $63,000.00 loss in this case. The parties have cited no decision articulating that an attorney has an obligation to notify opposing counsel when the attorney has actual knowledge that a third party access to information that should be confidential, terms of a settlement agreement, that the funds to a sensible one. Indeed, such as the settlement agreement have been the target of an attempted fraud. However, gained or the attorney has knowledge to be paid pursuant located such authority. has Nor has the Court the principle is an eminently Bile's briefing clearly considers that to be the case because Bile states, repeatedly, that attorneys have "an obligation to contact receive(] suspicious [opposing] emails counsel when and if they instructing [them] to wire settlement funds to a foreign country where such [a] request has never been made during the course 29 of performance of the parties." Pl.'s this argument this standard, Post-Hrg. orally during Resp. the 3, 23). evidentiary Ubom repeated hearing. Applying Ubom failed to act with the ordinary care that he, correctly, says should govern this case. Two days before the fraud was perpetrated on LeClairRyan, both Ubom and Bile were aware that an unidentified third party had targeted the settlement funds bank account that had nothing for di version to a Barclay's to do with Bile. Additionally, Bile and Ubom knew that ubomlawgroup@yahoo.com was being used in an effort to perpetrate the fraud. information along to Defendants, Ubom failed defense counsel, to pass this or the Court. This failure substantially contributed to the loss of $63,000.00 within the meaning of U.C.C. evident that if Oshinowo 3-406. § or Mago The Court finds it selfwas aware: (1) that the settlement funds were the target of a malicious third party; (2) that the terms of the confidential Settlement Agreement had been accessed by a malicious third party; or third party was angling to redirect the ( 3) that a malicious settlement funds Barclay's account when Bile had no such account, to a then Oshinowo would not have initiated the wire transfer on July 29, 2015. Because Ubom failed himself states is the to observe and because that failure substantially contributed to the loss, the principles law in the for U.C.C. 30 the and practice of he law, developed standard the ordinary care that associated case provide that Bile must bear the malicious third party behavior. 420; Barrett, 204 Cal. App. loss associated U.C.C. §§ 4th at 603; Willis, with the 3-404, 3-406, 32012 WL 112942, at *1. Bile attempts, incorrectly, to defend his behavior by vague references to law enforcement and industry advisories which were not introduced to the record. (Pl.' s Post-Hrg. Resp. ("the advisory from this Court, Bar advises emails that without one the FBI, ABA and [] every State should opening delete them; 3, 11, 20) as any such [,] suspected Counsel fraudulent deleted that fraudulent email when Plaintiff confirmed he did not send it."). Because the advisories are not in the record, Bile's argument simply fails for lack of proof. Moreover, it appears that such advisories simply do not say what Bile claims they say. In 2011, the American Bar Association republished regarding an an advisory from increasingly the California common scam by Bar Association which: ( 1} a prospective client, typically foreign, would solicit an attorney for legal prospective representation client would against inform another the attorney party; that ( 2) the the other party had capitulated and would mail the attorney a settlement check, and request attorney's fees) check and wire that the attorney to the client; the funds to ( 3) the 31 wire the funds (less the attorney would cash the client; ( 4) the bank would determine that the check was would be liable for counterfeit; the wired funds. and (5) Internet the attorney Scams State Bar of California Ethics Hotline Attorneys, Targeting {Jan. 2011), http://www.americanbar.org/content/dam/aba/administrative/profes sional_responsibility/6_combined_session_documents.authcheckdam. pdf. This advisory did conclude that "[h]itting the delete button may be the best course of action for the attorney" upon solicitation from suspicious and unknown clients. Id. at 6. The FBI released an advisory regarding a similar scam. New Twist on Counterfeit Bureau of Check Schemes Targeting Investigations U.S. Law Firms, Federal 27, 2016) Jul. (accessed https://www2.fbi.gov/cyberinvest/escams.htm. 21 Eastern The District of Virginia has not issued a warning about email scams targeting attorneys in the past three years. Scam Alerts, United States District Court for the 21 Eastern District of Virginia The type of scam referenced in the State Bar of California and FBI advisories has also led to litigation between attorneys and their banks. Fischer & Mandell, LLP v. Citibank, N.A., 632 F.3d 793, 795 (2d Cir. 2011); Simmons, Morris & Carroll, LLC v. Capital One, N.A., 49,005 (La. App. 2 Cir. Jun. 27, 2014); Mechanics Bank v. Methven, No. A136403, 2014 WL 4479741 (Cal. Ct. App. Sept. 12, 2014); Greenberg, Trager & Herbst, LLP v. HSBC Bank USA, 17 N. Y. 3d 565, 571, 958 N. E. 2d 77, 79 (2011); Bank One, NA v. Dunn, 40,718, 927 So. 2d 645 (La. App. 2 Cir. Apr. 12, 2006); O'Brien & Wolf, LLP v. Associated Banc-Corp, No. 11-CV-1253 SER, 2013 WL 1104641 (D. Minn. Mar. 18, 2013); Branch Banking & Trust Co. v. Witmeyer, No. 3:10CV55-HEH-DWD, 2011 WL 3297682, at *1 (E.D. Va. Jan. 6, 2011); PNC Bank, NA v. Martin, No. CIV.A 08-649-JBC, 2010 WL 3271725 (W.D. Ky. Aug. 19, 2010); JP Morgan Chase Bank, N.A. v. Cohen, 26 Misc. 3d 1215(A), 907 N.Y.S.2d 101 (Sup. Ct. 2009). 32 (accessed Jul. 2016)' 27' http://www.vaed.uscourts.gov/notices/SCAM%20ALERTS.pdf. The ABA and FBI advisories encourage attorneys to be wary of accepting clients who only communicate by email and to avoid wiring money on behalf of encourage those attorneys clients; to to delete this end, emails the from new advisories and do suspicious clients. The advisories say nothing about deleting emails which indicate that a third party is attempting to perpetrate fraud in connection with advisories which Bile misstates which he make Ubom's an ongoing stand the relies. case, for such a industry and Read more deletion of and Court proposition. can find no In conclusion, law enforcement advisories properly, the the July these 27, advisories 2015 email do on not without notifying opposing counsel reasonable. D. Defendants' Agents Exercised Ordinary Care Meanwhile, Defendants' agents neither violated the principle that attorneys must notify opposing counsel when they have actual knowledge of attempted fraud nor industry and law enforcement advisories transfers. that the First, July regarding unlike Ubom - 27, 2015 email attorneys, and wire who called Bile and thus knew from the fraud, aoi.com account was fraudulent - Oshinowo did not know or have any reason to suspect that the July 29' ubomlawgroup@yahoo.com was 2015 6: 40 fraudulent 33 p.m. until he email from spoke with Ubom on July 31, fraud. 2015, Second, at which point it was too late to prevent the the industry relating to attorneys, inapplicable to this and scams, law enforcement and wire transfers are, situation. Sending a wire advisories as noted, transfer to a known defendant on behalf of a known client is not the same as receiving a check from an unknown defendant and wiring funds to an unknown client. Nor did Defendants' in funds transfers. phone call foreign banks, 8, FBI, 11, Bile states, verification country is ABA, 19, agents act contrary to best practices of what 21). As any is and State with repeatedly, wire advised [Bars]." the scam variations on "[a] transfer and especially to recommend [ed] by a the (Pl.s Post-Hrg. Resp. 3-4, advisories which Bile on attempts to rely, these phone verification advisories are not in the record, and thus this argument also fails for lack of proof. Moreover, Bile again misstates the content of such advisories. The FBI did release an advisory on scams in which a fraudster mimics the wire transfer. Investigation identity of a person and then requests a Business E-mail (Jan. Compromise, Federal Bureau 22, https://www.ic3.gov/media/2015/150122.aspx. 22 22 of 2015)' However, that Suggestions that businesses should employ two-factor authentication to ensure that only authorized persons initiate wire transfers, e.g., Choice Escrow & Land Title, LLC v. BancorpSouth Bank, 754 F.3d 611 (8th Cir. 2014), are 34 advisory suggested corroborating requests to ensure validity and screening emails screening for for proper proper digital digital signatures. signatures In would not this have case, helped Oshinowo because the malicious third party had access to Ubom's actual email account, ubomlawgroup@yahoo.com. Additionally, the wire transfer request was partially corroborated: unlike typical business email compromise scams, which request a wire transfer for a payment which was previously wholly uncontemplated, this request redirected a pre-existing payment request, and that preexisting payment request had been discussed via phone as well as email. This is not to say that Oshinowo might not have exercised greater care when he received the email directing the settlement funds to an overseas bank account. However, Article 3 does not require best practices: it requires ordinary care, and there is no proof that LeClairRyan did not exercise ordinary care. At the heart of this agent, Ubom, could have case is the simple fact prevented the notifying opposing counsel on July 27, knowledge of an attempted fraud, loss of that Bile's $63, 000. 00 by 2015 when he had actual the known purpose of which was to lay hands on the settlement funds. As technology evolves and fraudulent schemes evolve with it, the Court has no compunction inapplicable here, because the LeClairRyan employee who initiated the wire transfer, Lemmert, was an authorized person who would have had legitimate access to both factors. 35 in firmly stating a rule that: where an attorney has actual knowledge that a malicious third party is targeting one of his cases with fraudulent intent, the attorney must either alert opposing counsel or must bear the losses to which his failure substantially contributed. The Court concludes that Defendants substantially performed their obligations completed the acted with under wire the transfer ordinary Settlement of care. $63, 000. 00. Because performed on or about July 29, Agreement 2015, they so doing, In when they Defendants substantially Defendants are entitled to compel enforcement of the Settlement Agreement. (Cf. Pl.'s Post- Hrg. Resp. 17-20). Because Defendants substantially performed on or about July 29, 2015, Defendants could not have committed an anticipatory breach when Oshinowo communicated to Ubom on July 31, Defendants would not pay out Defendants engage in the first Pl.' s 14-17, Post-Hrg. Mem. another (or any) $63,000.00, 2015 that nor material breach. 24-28). Because did (Cf. Defendants substantially performed, Bile cannot demand specific performance which would compel Defendants performance. 36 to repeat their substantial CONCLUSION For the reasons set forth above, Defendants substantially performed their obligations under the Settlement Agreement on or about July 29, 2015, and Defendants reciprocal performance from Bile. FOR SETTLEMENT ENFORCEMENT are Therefore, (Docket No. 51) entitled to compel Defendants' MOTION will be granted and Plaintiff's MOTION TO ENFORCE SETTLEMENT AGREEMENT 54} (Docket No. will be denied. An order dismissing the case with prejudice will be entered. It is so ORDERED. /s/ Robert E. Payne Senior United States District Judge Richmond, Virginia Date: August -1::!f_, 2016 37

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