UNPUBLISHED
UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT
No. 20-1249
BIEJAN ARVON,
Plaintiff − Appellant,
v.
LIBERTY MUTUAL FIRE INSURANCE COMPANY,
Defendant and 3rd-Party Plaintiff - Appellee,
MARC SELDIN ROSEN, Esq.; LAW OFFICES OF MARC SELDIN ROSEN,
Third Party Defendants.
Appeal from the United States District Court for the District of Maryland, at Baltimore. Beth P. Gesner, Magistrate Judge. (1:17−cv−02022−BPG)
Argued: May 6, 2021 Decided: August 4, 2021
Before MOTZ, DIAZ, and RICHARDSON, Circuit Judges.
Affirmed by unpublished opinion. Judge Diaz wrote the opinion, in which Judge Motz and Judge Richardson joined.
Jeffrey M. Kotz, KOTZ LAW GROUP, Towson, Maryland, for Appellant. James Charles Mehigan, MEHIGAN LAW GROUP PLLC, Reston, Virginia, for Appellee. Unpublished opinions are not binding precedent in this circuit.
2 DIAZ, Circuit Judge:
In the decade since a car crash injured Biejan Arvon, he’s yet to find the right way
to hold someone accountable for his injuries. He’s sued the wrong person, waited too long
to sue the right people, and failed to persuade Liberty Mutual Fire Insurance Company to
accept a settlement offer on behalf of its insureds. Even though Liberty Mutual paid for
the damage to his car and at least some of his medical bills, Arvon has now sued the
insurance company for purportedly sabotaging his previous legal efforts. But, once again,
he hasn’t succeeded.
I.
In July 2011, Biejan Arvon’s car was rear-ended by another car driven by Alireza
Gol. The other car’s owner, Hamed Khodaparasti, was in the passenger’s seat when the
crash occurred because he was feeling ill and asked Gol to drive. Khodaparasti had recently
immigrated to the United States and didn’t speak enough English to obtain auto insurance
on his own, so he had insured his car by enlisting his roommate, Puya Shakiba, to obtain a
policy with Liberty Mutual Fire Insurance Company. The policy listed Shakiba and
Khodaparasti as co-policyholders.
Because Arvon was transported to a nearby hospital for treatment after the accident,
he was unable to exchange contact and insurance information with Gol and Khodaparasti.
But the police officer who was dispatched to the scene prepared a publicly available
accident report that described the accident, named all three men, and listed the relevant
insurance information.
3 Someone—likely either Khodaparasti or Gol, but it’s unclear who—called Liberty
Mutual to report the crash two days later. A Liberty Mutual representative then contacted
Arvon’s wife, who told the representative that Arvon was in the hospital being treated for
his injuries.
Around the same time, another Liberty Mutual representative investigated the crash
and determined that Gol was both 100% at fault and covered under Khodaparasti’s policy
as a permissive driver. As a result, Liberty Mutual paid for the property damage to Arvon’s
car and at least some of Arvon’s medical expenses. Arvon also testified that, around this
time, someone from Liberty Mutual informed him over the phone that Shakiba was the
person “responsible” for the collision. J.A. 507.
Liberty Mutual then sent Arvon several letters in the course of its claims handling
process. The letters all identified Shakiba as the “Insured,” and none of them mentioned
Gol or Khodaparasti. J.A. 178–97. In the meantime, Arvon retained counsel. Arvon’s
counsel and Liberty Mutual tried for some time to negotiate a possible settlement, but they
were unsuccessful. Arvon eventually sued Shakiba in Maryland state court on June 23,
2014, about two weeks before Maryland’s three-year limitations period for negligence
actions was set to expire.
Shortly after filing suit, Arvon’s counsel notified Liberty Mutual that counsel
intended to serve Shakiba, and Liberty Mutual responded only to say that it hadn’t yet
reviewed Arvon’s latest settlement demand package. See Arvon v. Shakiba, 2017 WL
1592555, at *2 (Md. Ct. Spec. App. May 1, 2017). The limitations period expired without
the two sides reaching an agreement. About three weeks later, Liberty Mutual responded
4 to another settlement-related email from Arvon’s lawyer and made clear for the first time
that Gol and Khodaparasti—not Shakiba—were in the car that rear-ended Arvon. Id.
Arvon then amended his complaint to add Khodaparasti and Gol as defendants. But
the state trial court eventually granted summary judgment in favor of Khodaparasti, Gol,
and Shakiba. It ruled that Shakiba couldn’t be liable because he wasn’t driving the car,
and Gol and Khodaparasti couldn’t be liable because Arvon sued them after the limitations
period expired. Id. at *1.
Arvon appealed that ruling, and the Maryland Court of Special Appeals affirmed.
Id. In doing so, however, the court opined that Arvon’s “claims regarding
misrepresentations and bad faith may be more properly aimed at Liberty Mutual in another
forum.” Id. at *4. Taking that suggestion to heart, Arvon filed this action against Liberty
Mutual for fraudulently and negligently misrepresenting that Shakiba was the car’s driver
until the limitations period for suing Gol and Khodaparasti had expired. After Liberty
Mutual removed the case to federal court, the district court granted summary judgment in
Liberty Mutual’s favor. 1
Arvon timely filed a Motion to Alter or Amend Judgment—essentially a Federal
Rule of Civil Procedure 59(e) motion for reconsideration of the court’s summary judgment
ruling. He argued that evidence in the summary judgment record showed that someone
1 Both a district judge and a magistrate judge entered orders affecting the case. Since it isn’t necessary for purposes of this appeal to distinguish between the two judges, we refer to both as the “district court.”
5 from Liberty Mutual (Arvon couldn’t remember who) told Arvon during a phone call that
Shakiba was the at-fault driver.
The district court denied the motion. It suggested that, as a procedural matter,
Arvon’s motion failed because the evidence supporting his argument was available to him
during summary judgment briefing. The court also ruled on the merits of Arvon’s request
that the evidence itself was insufficient to create a genuine dispute of material fact about
whether Liberty Mutual fraudulently or negligently misrepresented any material
information to him.
This appeal followed.
II.
Although Arvon collapses his appeal into a single challenge to the district court’s
judgment against him, there are two separate issues for us to consider: (1) whether the
district court properly granted summary judgment in Liberty Mutual’s favor; and (2)
whether the district court correctly denied Arvon’s motion for reconsideration. We begin
with the latter question, as its answer informs the former.
A.
In his Rule 59(e) motion, Arvon argued that the district court erroneously concluded
that no genuine dispute of fact existed about whether Liberty Mutual ever told him that
Shakiba was the at-fault driver. Even though Arvon never cited to or discussed it in his
summary judgment briefing, a passage from his deposition—which was in the summary
judgment record—suggests that Arvon recalled “a conversation with a woman at Liberty
6 [Mutual] whose name [he does] not know” who “told [him] that Puya Shakiba was
responsible for [his] accident.” J.A. 508.
According to Arvon, this testimony contradicted Liberty Mutual’s position that it
never represented that Shakiba was at fault for the car crash. He contended, based on that
purported evidentiary conflict, that the court should have changed its summary judgment
ruling and permitted the case to proceed to trial. Arvon makes the same argument on
appeal, and we reject it.
District courts may grant a Rule 59(e) motion for three reasons: “(1) to
accommodate an intervening change in controlling law; (2) to account for new evidence
not available at [the time of judgment]; or (3) to correct a clear error of law or prevent
manifest injustice.” Zinkand v. Brown, 478 F.3d 634, 637 (4th Cir. 2007) (cleaned up).
We may not overturn a district court’s decision on a Rule 59(e) motion unless the court
abused its discretion. Wicomico Nursing Home v. Padilla, 910 F.3d 739, 750 (4th Cir.
2018).
Here, the district court acted well within its discretion to deny Arvon’s motion. For
starters, Arvon’s argument relies on no change in law. Since the deposition testimony that
Arvon cites was in the summary judgment record before the district court, it was certainly
available to him at the time of judgment. Accordingly, Arvon can succeed only if the
7 district court’s ruling was legal error or created a “manifest injustice.” 2 J.A. 543. For two
independent reasons, it didn’t.
First, the court committed no error by failing to consider Arvon’s testimony about
the phone call because Arvon never cited to it during summary judgment proceedings.
Federal Rule of Civil Procedure 56 states that “[t]he court need consider only the cited
materials” in a summary judgment brief, even though it “may consider other materials in
the record.” Fed. R. Civ. P. 56(c)(3). Rule 56(c)(3) was added to the Federal Rules of
Civil Procedure in 2010 to clarify that a “court may decide a motion for summary judgment
without undertaking an independent search of the record.” Id. at Committee Notes on
Rules—2010 Amendment; see also Carlson v. Bos. Sci. Corp., 856 F.3d 320, 324 (4th Cir.
2017) (The Rule now “require[s] parties to cite all evidence in support of their positions at
summary judgment, thus permitting a district court to limit its review to such cited
materials”).
Here, Arvon could have cited to his own deposition testimony during summary
judgment briefing, but he didn’t. His failure to timely highlight his own testimony to the
district court dooms any claim that the court’s ruling was legal error or created a manifest
2 While federal courts have yet to provide a concrete definition of “manifest injustice,” they have set out guidelines that aid us here. In Robinson v. Wix Filtration Corp. LLC, 599 F.3d 403, 408–09 (4th Cir. 2010), we cited with approval Fox v. Am. Airlines, Inc., 389 F.3d 1291, 1296 (D.C. Cir. 2004), which affirmed a district court’s denial of a Rule 59(e) motion when “the dismissal of the [] suit might have been avoided through the exercise of due diligence.” And the D.C. Circuit held in another case that “[m]anifest injustice does not exist where . . . a party could have easily avoided the outcome, but instead elected not to act until after a final order had been entered.” Ciralsky v. C.I.A., 355 F.3d 661, 673 (D.C. Cir. 2004) (cleaned up). 8 injustice—particularly when the rules governing summary judgment permitted the court to
ignore uncited evidence.
Second, we agree with the district court that the phone call doesn’t create a genuine
dispute of material fact. Even if we accept Arvon’s testimony that someone from Liberty
Mutual told him that Shakiba was “the one who is responsible for [his] accident,” J.A. 507,
that statement is not at odds with Liberty Mutual’s determination that Shakiba was
“responsible” because he held the insurance policy under which Liberty Mutual reimbursed
Arvon for his property damage and personal injuries. As the district court explained, that’s
a different issue than the primary one in this case: whether Liberty Mutual represented that
Shakiba was the “at-fault driver” in the collision that injured Arvon. J.A. 543. Since the
unnamed Liberty Mutual agent never suggested that Shakiba was in the car that rear-ended
Arvon’s car, the phone call evidence doesn’t create a genuine dispute of material fact.
Spriggs v. Diamond Auto Glass, 242 F.3d 179, 183 (4th Cir. 2001) (“[M]aterial fact[s]” are
those “that might affect the outcome of the suit under the governing law.”) (quoting
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). The district court’s ruling was
therefore correct and caused no manifest injustice by failing to consider Arvon’s additional
evidence.
We affirm the district court’s denial of Arvon’s Rule 59(e) motion.
B.
We turn now to the district court’s summary judgment ruling. The court ruled in
Liberty Mutual’s favor on Arvon’s fraudulent and negligent misrepresentation claims
because “no reasonable jury could find that: (1) [Liberty Mutual] made a false statement
9 to [Arvon]; (2) [Liberty Mutual] owed a duty to [Arvon] to disclose all material facts; and
(3) [Liberty Mutual] intended to defraud [Arvon] or intended that its statements would be
acted upon by [Arvon].” Id. at *4. We have carefully reviewed the record that the district
court examined and now affirm largely on the district court’s reasoning. See Arvon v.
Liberty Mut. Fire Ins. Co., No. CV BPG-17-2022, 2019 WL 4243035 (D. Md. Sept. 6,
2019).
1.
First, the district court was correct that Liberty Mutual made no false statement to
Arvon. A claim under Maryland law for fraudulent misrepresentation based on an
affirmative false statement generally requires the plaintiff to show:
(1) that defendant made a misrepresentation of a material fact which was false; (2) that its falsity was known to him; (3) that defendant made the misrepresentation for the purpose of defrauding plaintiff; (4) that plaintiff not only relied upon the misrepresentation but had the right to do so and would not have done the thing from which the damage resulted if it had not been made; and (5) that plaintiff suffered damage from defendant’s misrepresentation.
Finch v. Hughes Aircraft Co., 469 A.2d 867, 888 (Md. Ct. Spec. App. 1984).
At summary judgment, Arvon relied on two categories of communications he had
with Liberty Mutual. The first category includes the letters from Liberty Mutual to Arvon
indicating that Shakiba was the “Insured.” J.A. 467. The second includes correspondence
between Arvon’s attorney and Liberty Mutual that reflect an understanding by the attorney
that Shakiba was the at-fault driver. These include letters that refer to Shakiba as the
“Insured” for purposes of settlement discussions; a message from counsel to Liberty
Mutual stating, “your insured, Puya Shakiba, rear ended” Arvon; an email from counsel to
10 Liberty Mutual attaching Arvon’s state-court complaint against Shakiba; and an email from
counsel to Liberty Mutual with the subject line, “RE: Biejan Arvon v. Puya Shakiba.” J.A.
467–68.
But the only statements from Liberty Mutual are those that described Shakiba as an
“insured.” And that description was literally true, since Shakiba and Khodaparasti were
co-holders of the policy under which Liberty Mutual accepted coverage obligations. No
evidence in the record cited to the district court suggests that Liberty Mutual ever
affirmatively described Shakiba as the at-fault driver. Since Arvon hasn’t shown that
Liberty Mutual affirmatively misrepresented any material fact, he can’t recover under that
theory of fraudulent misrepresentation. Finch, 469 A.2d at 888.
Our analysis would end there, except that “Maryland law [also] recognizes the
possibility that statements that are not literally false may nevertheless be fraudulent.” State
Constr. Corp. v. Slone Assocs., Inc., 385 F. Supp. 3d 449, 469 (D. Md. 2019) (citing Lubore
v. RPM Assocs., Inc., 674 A.2d 547, 556 (Md. Ct. Spec. App. 1996). In such cases, when
plaintiffs assert a theory of fraudulent misrepresentation through concealment or
nondisclosure, fraud can occur when, “in addition to a party’s silence, there is any
statement, word, or act on his part, which tends affirmatively to the suppression of the truth,
or to a covering up or disguising of the truth, or to a withdrawal or distraction of a party’s
attention from the real facts.” Lubore, 674 A.2d at 556 (cleaned up). Then, instead of the
first two fraudulent misrepresentation elements described above, plaintiffs must show that
“(1) Defendant owed a duty to plaintiff to disclose a material fact; [and] (2) Defendant
11 failed to disclose that fact.” Id. at 555. The other three elements—intent to defraud,
justifiable reliance, and causation—are the same. See id.
Similarly, a claim for negligent misrepresentation in Maryland requires a plaintiff
to demonstrate that:
(1) the defendant, owing a duty of care to the plaintiff, negligently asserts a false statement; (2) the defendant intends that his statement will be acted upon by the plaintiff; (3) the defendant has knowledge that the plaintiff will probably rely on the statement, which, if erroneous, will cause loss or injury; (4) the plaintiff, justifiably, takes action in reliance on the statement; and (5) the plaintiff suffers damage proximately caused by the defendant’s negligence.
Martens Chevrolet, Inc. v. Seney, 439 A.2d 534, 539 (Md. 1982).
Although the district court didn’t squarely address concealment or negligent
nondisclosure with respect to these alternative theories of liability, 3 we conclude that
Arvon’s claims nonetheless fail because the important information that Liberty Mutual may
have concealed or negligently withheld was immaterial under Maryland law.
Maryland courts have held that, under either a fraudulent or negligent
misrepresentation theory, the misrepresented, concealed, or negligently withheld
information must be “material” to the dispute. Gross v. Sussex Inc., 630 A.2d 1156, 1162
(Md. 1993). And that materiality requirement operates in the same way with respect to
both torts. See id. (describing the materiality requirement as a “common element[]” of
fraudulent and negligent misrepresentation claims). Relevant here, a “misrepresentation is
3 Instead, it moved on to whether Liberty Mutual owed Arvon a duty of disclosure, an issue that we discuss further below. See Arvon, 2019 WL 4243035, at *5–*7.
12 generally immaterial if the party to whom it is made reasonably could have ascertained the
true facts.” Sass v. Andrew, 832 A.2d 247, 266 (Md. Ct. Spec. App. 2003) (citing Carozza
v. Peacock Land Corp., 188 A.2d 917, 921 (Md. 1963)).
We conclude that Arvon could have ascertained this case’s key fact—that Shakiba
wasn’t the at-fault driver—with minimal and reasonable effort. It’s undisputed that:
an accident report was completed by a police officer on the day of the accident. This report was public and available to [Arvon] for review at any time. The report lists Gol as the driver of the vehicle and [Khodaparasti] as the owner of the vehicle. Shakiba’s name does not appear anywhere on the police report.
Arvon, 2017 WL 1592555, at *4. As the Maryland Court of Special Appeals noted, Arvon
“had this report available to him for three years before” suing Shakiba, but “[Arvon] and
counsel apparently never looked at the police report.” Id. Even a cursory “review of the
report at any point during the three-year period would have alerted [Arvon] as to the correct
party to sue.” Id.
Arvon argues that the law shouldn’t have required him to consult the police report
before filing suit, but he misses the mark. He relies mainly on Gross’s discussion of the
following passage from a tort treatise:
It is now held that assertions of fact as to quantity or quality of land or goods sold, the financial status of corporations, and similar matters inducing commercial transactions, may justifiably be relied on without investigation, not only where such investigation would be burdensome or difficult, as where land which is sold lies at a distance, but likewise where the falsity of the representations might be discovered with little effort by means easily at hand. The plaintiff is not required, for example, to examine public records to ascertain the true state of the title claimed by the defendant. It is only where, under the circumstances, the facts should be apparent to one of his knowledge and intelligence from a cursory glance or he has discovered
13 something which should serve as a warning that he is being deceived, that he is required to make an investigation of his own.
630 A.2d at 1167 (emphasis added) (quoting W. Page Keeton et al., Prosser and Keeton,
on the Law of Torts § 108 at 752 (5th Ed. 1984)).
While the italicized language above suggests that, in certain circumstances,
Maryland law absolves plaintiffs of the obligation to dig through public records before
filing suit, the treatise on which Gross relies limits itself to assertions regarding the
“quantity or quality of land or goods sold, the financial status of corporations, and similar
matters inducing commercial transactions.” 630 A.2d at 1167. And Gross itself was a case
about a real property sale. See generally id. Arvon’s suit against Shakiba, on the other
hand, involved no real property transaction, sale of goods, corporate finances, or
commercial transactions—it was a personal injury dispute.
Moreover, even if we could interpret Gross’s reasoning to apply outside the specific
contexts that the treatise highlighted, the case also limits itself to false “assertions of fact,”
not purported misrepresentations via silence or nondisclosure (like we have here). That
limitation is consistent with other Maryland courts’ decisions in cases involving affirmative
false statements. See, e.g., Rozen v. Greenberg, 886 A.2d 924, 931 (Md. Spec. Ct. App.
2005) (holding that affirmative misrepresentations about the defendant’s business
capabilities and qualifications were material and induced justifiable reliance, even though
plaintiff could have investigated to find out the truth). In the context of misrepresentation
through concealment, however, the plaintiff must prove that he “could not have discovered
14 the cause of action despite the exercise of reasonable diligence.” Frederick Rd. Ltd. P’ship
v. Brown & Sturm, 756 A.2d 963, 976 n.14 (Md. 2000) (emphasis added).
The bottom line is that, with some minimal effort and diligence, Arvon could have
consulted the police report at any point during the three-year limitations period and learned
that Gol (with Khodaparasti as his passenger)—not Shakiba—rear-ended Arvon. 2017 WL
1592555 at *4 (opining that Arvon’s “argument is undercut by the fact that the necessary
information to correctly file suit was available at [his] disposal for the entirety of the period
prior to the expiration of the statute of limitations.”). Since the at-fault driver’s identity
was therefore immaterial for the purposes of misrepresentation claims, Sass, 832 A.2d at
266, Arvon’s claims based on concealment or negligent misrepresentation must fail.
2.
We also agree with the district court that (1) Liberty Mutual owed no duty of
disclosure to Arvon and that (2) Arvon failed to show that Liberty Mutual intended to
deceive him.
First, a plaintiff attempting to show that a defendant owed a duty of care in a tortious
misrepresentation case must demonstrate an “intimate nexus” between the parties through
“contractual privity or its equivalent.” Griesi v. Atl. Gen. Hosp. Corp., 756 A.2d 548, 554
(Md. 2000). In other words, the relationship between the parties “must be such that in
morals and good conscience the one has the right to rely upon the other for information,
and the other giving the information owes a duty to give it with care.” Id. Such an intimate
nexus exists, for example:
15 between parties who have engaged in detailed, months-long business negotiations, or contemplated a long-term relationship. Courts have also considered whether the party making the alleged misrepresentation had exclusive control over material information necessary for the other party to understand the situation, and whether the defendant’s promises were an inducement to the plaintiff and provided the defendant with a business advantage when the plaintiff acted in conformance with them.
Dierker v. Eagle Nat’l Bank, 888 F. Supp. 2d 645, 655–56 (D. Md. 2012) (cleaned up)
(citing decisions from Maryland courts and the Fourth Circuit interpreting Maryland law).
We see no reason to conclude that any nexus between Liberty Mutual and Arvon
was close or intimate enough to create a tort duty in this case. The parties had no long-
term relationship and engaged in no detailed or drawn-out business negotiations. Nor did
Liberty Mutual have exclusive control over the material information in this case—rather,
Arvon could have obtained it through the police report from day one. Thus, Liberty Mutual
owed Arvon no duty to disclose.
Second, Arvon’s claims require him to show that Liberty Mutual intended to deceive
him. Martens Chevrolet, 439 A.2d at 539; Lubore, 674 A.2d at 555. Arvon argues that
Liberty Mutual deceived him by knowing the identity of the real at-fault driver and
choosing not to disclose it. The only explanation for that choice, Arvon contends, is that
Liberty Mutual intended to hide the truth in order to run out the three-year limitations clock
and avoid its coverage obligations.
To the contrary, the record shows that Liberty Mutual promptly determined that its
insured was at fault and then paid for Arvon’s property damage and some of his medical
expenses. It also shows that the letters from Liberty Mutual to Arvon listed Shakiba as the
“Insured” not because of some nefarious intent to hide Gol or Khodaparasti’s identity, but
16 because Liberty Mutual’s computerized correspondence system automatically populates
letters’ subject lines with the name of one of the policyholders of the relevant policy. In
this case, that name happened to be Shakiba’s, rather than Khodaparasti’s, and the claims
agent who sent the letters had no ability to change the subject line. Liberty Mutual’s
automated system may not be the wisest or most direct method of communicating with
claimants, but it doesn’t reflect an intent to mislead or deceive.
Without any evidence demonstrating such intent, this line of argument is no more
than the speculative “building of one inference upon another,” which isn’t enough to create
a genuine dispute of material fact. Cox v. Cnty. of Prince William, 249 F.3d 295, 300 (4th
Cir. 2001) (cleaned up). Since Arvon has advanced no concrete evidence of Liberty
Mutual’s intent to deceive him, we agree with the district court that his claims must fail.
In sum, Arvon has demonstrated no genuine disputes of material fact as to whether
Liberty Mutual made a material misrepresentation, whether Liberty Mutual owed him any
duty of care, or whether Liberty Mutual intended to deceive him.
III.
For these reasons, the district court’s judgment is
AFFIRMED.