Pannell v. Protection Strategies Incorporated

• Court: District Court, District of Columbia
• Decided: February 22, 2022
• Docket: Civil Action No. 2021-0602
• Status: Published

Opinion

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

CARL E. PANNELL, JR.,

Plaintiff, v. Civ. Action No. 21-602 PROTECTION STRATEGIES, INC., (EGS) Defendant.

MEMORANDUM OPINION AND ORDER

Plaintiff Carl E. Pannell, Jr. (“Mr. Pannell”), proceeding

pro se, brings this lawsuit against Protection Strategies, Inc.

(“PSI”) alleging defamation by PSI that resulted in him being

found unsuitable for federal employment and contractual federal

employment. See generally Compl., ECF No. 1-1. Pending before

the Court is PSI’s Motion to Dismiss. See ECF No. 6. Upon

careful consideration of the motion, the opposition and reply

thereto, and the applicable law, PSI’s Motion to Dismiss is

DENIED.

I. Factual Background

The Court assumes the following facts alleged in the

complaint to be true for the purposes of deciding this motion

and construes them in Mr. Pannell’s favor. See Baird v. Gotbaum,

792 F.3d 166, 169 n.2 (D.C. Cir. 2015). From May 15, 2018 to June

1, 2018, Mr. Pannell was employed by PSI as a Personnel Security

1 Specialist, located in a building occupied by the Department of

Justice. Compl., ECF No. 1-1 ¶¶ 1, 5. During his employment, he

was not reprimanded for any behavior, but his supervisor was

“insolent” and “demeaning” to him and so he requested that he be

trained by another PSI employee. Id. ¶¶ 6, 8, 9. On May 25,

2018, he was informed by a PSI manager that his complaints about

his supervisor would be investigated. Id. ¶ 10. Thereafter, on

June 1, 2018, he was informed via a telephone call that his

employment was terminated but was not given the reason for his

termination. Id. ¶ 14. He later learned that the reason for his

termination was “contrived” by the supervisor about whom he had

complained based on her animus towards him. Id. ¶ 14. In

February 2020, he was interviewed by a federal investigator as

part of a federal background investigation. Id. ¶¶ 17, 21. In

December 2020, he learned that PSI had informed the investigator

that he had been involuntarily terminated because he “had

inquired how to search individuals in the Department of

Justice’s database system to obtain personal information.” Id.

¶ 20. Mr. Pannell alleges that this statement is false, see id.

¶ 7; and that it has resulted in him losing several employment

opportunities, see id. ¶ 21.

2 II. Standards of Review

A. Rule 12(b)(1): Subject Matter Jurisdiction

“A federal district court may only hear a claim over which

[it] has subject matter jurisdiction; therefore, a Rule 12(b)(1)

motion for dismissal is a threshold challenge to a court's

jurisdiction.” Gregorio v. Hoover, 238 F. Supp. 3d 37 (D.D.C.

2017) (citation and internal quotation marks omitted). To

survive a Rule 12(b)(1) motion, the plaintiff bears the burden

of establishing that the court has jurisdiction by a

preponderance of the evidence. Lujan v. Defenders of Wildlife,

504 U.S. 555, 561, (1992). Because Rule 12(b)(1) concerns a

court's ability to hear a particular claim, “the court must

scrutinize the plaintiff's allegations more closely when

considering a motion to dismiss pursuant to Rule 12(b)(1) than

it would under a motion to dismiss pursuant to Rule 12(b)(6).”

Schmidt v. U.S. Capitol Police Bd., 826 F. Supp. 2d 59, 65

(D.D.C. 2011) (citations omitted). In so doing, the court must

accept as true all of the factual allegations in the complaint

and draw all reasonable inferences in favor of the plaintiff,

but the court need not “accept inferences unsupported by the

facts alleged or legal conclusions that are cast as factual

allegations.” Rann v. Chao, 154 F. Supp. 2d 61, 64 (D.D.C.

2001).

3 Faced with motions to dismiss under Rule 12(b)(1) and Rule

12(b)(6), a court should first consider the Rule 12(b)(1) motion

because “[o]nce a court determines that it lacks subject matter

jurisdiction, it can proceed no further.” Ctr. for Biological

Diversity v. Jackson, 815 F. Supp. 2d 85, 90 (D.D.C. 2011)

(citations and internal quotation marks omitted).

B. Rule 12(b)(6): Failure to State a Claim

A motion to dismiss pursuant to Federal Rule of Civil

Procedure 12(b)(6) tests the legal sufficiency of a complaint.

Browning v. Clinton, 292 F.3d 235, 242 (D.C. Cir. 2002). A

complaint must contain "a short and plain statement of the claim

showing that the pleader is entitled to relief, in order to give

the defendant fair notice of what the . . . claim is and the

grounds upon which it rests." Bell Atl. Corp. v. Twombly, 550

U.S. 544, 555, (2007) (internal quotation marks omitted).

Despite this liberal pleading standard, to survive a motion

to dismiss, a complaint "must contain sufficient factual matter,

accepted as true, to state a claim to relief that is plausible

on its face." Ashcroft v. Iqbal, 556 U.S. 662, 678, (2009)

(internal quotation marks omitted). “In determining whether a

complaint fails to state a claim, [the Court] may consider only

the facts alleged in the complaint, any documents either

attached to or incorporated in the complaint and matters of

which [the Court] may take judicial notice.”

4 Xavier Parochial Schl., 117 F.3d 621, 624 (D.C. Cir. 1997). A

claim is facially plausible when the facts pled in the complaint

allow the court to "draw the reasonable inference that the

defendant is liable for the misconduct alleged." Id. The

standard does not amount to a "probability requirement," but it

does require more than a "sheer possibility that a defendant has

acted unlawfully." Id.

"[W]hen ruling on a defendant's motion to dismiss [pursuant

to Rule 12(b)(6)], a judge must accept as true all of the

factual allegations contained in the complaint." Atherton v.

D.C. Office of the Mayor, 567 F.3d 672, 681 (D.C. Cir. 2009)

(internal quotation marks omitted). In addition, the court must

give the plaintiff the "benefit of all inferences that can be

derived from the facts alleged." Kowal v. MCI Commc'ns Corp., 16

F.3d 1271, 1276 (D.C. Cir. 1994). A "pro se complaint is

entitled to liberal construction." Washington v. Geren, 675 F.

Supp. 2d 26, 31 (D.D.C. 2009) (citation omitted). Even so,

"[t]hreadbare recitals of the elements of a cause of action,

supported by mere conclusory statements" are not sufficient to

state a claim. Iqbal, 556 U.S. at 678.

5 III. Analysis

A. The Court Has Jurisdiction Over Mr. Pannell’s Defamation Claim

PSI argues that the Court lacks subject matter jurisdiction

over Mr. Pannell’s defamation claim “because [the] Complaint

necessarily implicates a decision to deny a security clearance.”

Mot. to Dismiss, ECF No.6-1 at 8. The Court notes that the

Complaint does not allege a decision to deny a security

clearance, but rather that Mr. Pannell was “[f]ound

unfavorable/questionable to [sic] federal background

investigations” and “[u]nsuitable for Federal employment and

contractual Federal employment.” Compl., ECF No. 1-1 ¶ 21. The

Court is persuaded that it has jurisdiction over Mr. Pannell’s

defamation claim because the two cases upon which PSI relies are

distinguishable.

In Dept. of the Navy v. Egan, Mr. Egan sought review of the

denial of his security clearance by the Merit Systems Protection

Board (“Board”). 484 U.S. 518, 522 (1988). The Supreme Court

held that the Board was without authority “to review the

substance of an underlying security clearance determination in

the course of reviewing an adverse action” because “[i]t is not

reasonably possible for an outside, nonexpert body to review the

substance of such a judgment . . . .” Id. at 520, 529. In Ryan

v. Reno, plaintiffs alleged employment discrimination based on

6 national origin and citizenship based on withdrawn offers of

employment by the Department of Justice and the Immigration and

Naturalization Service. 168 F.3d 520, 522 (D.C. Cir. 1999). The

offers were withdrawn because, due to the plaintiffs having

lived in Ireland for a number of years, it would not be possible

to conduct the background investigation needed for the security

clearances the plaintiffs needed to perform their jobs. Id. The

Court of Appeals for the District of Columbia Circuit affirmed

the district court’s dismissal for lack of jurisdiction based on

the Supreme Court’s decision in Egan. Id. The court reasoned

that to determine the merits of the Title VII claim, it would

need to review the merits of DOJ’s decision to withdraw the

offers of employment. Specifically, under the second step of the

burden-shifting framework set forth in McDonnell Douglas Corp.

v. Green, 411 U.S. 792, 802–05 (1973), 1 the Court would need to

review the employer’s articulation of its legitimate,

nondiscriminatory reason for its adverse employment action. Id.

at 523. Accordingly, the court held “that under Egan, an adverse

1 Under this framework, “[t]o state a prima facie case of discrimination, a plaintiff must allege [he] is part of a protected class under Title VII, [he] suffered a cognizable adverse employment action, and the action gives rise to an inference of discrimination.” Stella v. Mineta, 284 F.3d 135, 145 (D.C. Cir. 2002). “If the plaintiff clears that hurdle, the burden shifts to the employer to identify the legitimate, nondiscriminatory or non-retaliatory reason on which it relied in taking the complained-of action.” Holcomb v. Powell, 433 F.3d 889, 896 (D.C. Cir. 2006).

7 employment action based on denial or revocation of a security

clearance is not actionable under Title VII.” Id. at 524.

Here, Mr. Pannell is not challenging the unsuitability

determination itself; rather he alleges that PSI defamed him

when it informed the investigator of the reason for his

involuntary termination because the reason that was given is

false. To determine whether Mr. Pannell has stated a claim for

defamation, it is not necessary for the Court to reach the

merits of the unsuitability determination. Accordingly, the

Court has subject matter jurisdiction over his defamation claim.

B. Mr. Pannell Has Stated a Claim for Defamation

To state a claim for defamation under District of Columbia

law, Mr. Pannell “must allege that sufficient facts to

establish: ‘(1) that the defendant made a false and defamatory

statement concerning the plaintiff; (2) that the defendant

published the statement without privilege to a third party; (3)

that the defendant’s statement in publishing the statement

amounted to at least negligence; and (4) either that the

statement was actionable as a matter of law irrespective of

special harm or that its publication caused the plaintiff

special harm.’” Libre By Nexus v. Buzzfeed, Inc., 311 F. Supp.

3d 149, 155 (D.D.C. 2018) (quoting Deripaska v. Associated

Press, 282 F. Supp. 3d 133, 140-41 (D.D.C. 2017) (quoting

Solers, Inc., v. Doe, 977 A.2d 941, 948 (D.C. 2009)).

8 With regard to the second element, “[q]ualified or

conditional privileges ‘are based upon a public policy that

recognizes that it is desirable that true information be given

whenever it is reasonably necessary for the protection of the

actor’s own interests, the interests of a third person or

certain interests of the public.’” Moss v. Stockard, 580 A.2d

1011, 1024 (D.C. 1990) (quoting RESTATEMENT (SECOND) of Torts,

title B introductory note (1997)). “A statement is protected by

the common interest privilege if it is ‘(1) made in good faith,

(2) on a subject in which the party communicating has an

interest, or in reference to which he has or honestly believes

he has a duty (3) to a person who has such a corresponding

interest or duty.’” Payne v. Clark, 25 A.23d 918, 925 (D.C.

2011) (quoting Moss, 580 A.2d at 1024). “Whether a statement is

privileged is a question of law.” Id. (citing Carter v. Hahn,

821 A.2d 890, 894 (D.C. 2003).

“If a statement is subject to the common interest

privilege, ‘the burden is on the plaintiff to prove the

privilege has been abused.’” Id. (citing Blodgett, 930 A.2d at

224. “Where the court determines that the common interest

privilege is applicable, the defendant will be presumed to have

been actuated by pure motives in its publication [, and] [i]n

order to rebut this presumption, express malice or malice in

fact must be shown [by the plaintiff].” Moss, 580 A.2d at 1024

9 (citing Ford Motor Credit v. Holland, 367 A.2d 1311, 1314 (D.C.

1977) (other citation omitted). “Unless the statement itself is

‘so excessive, intemperate, unreasonable, and abusive as to

forbid any other reasonable conclusion than that the defendant

was actuated by express malice,’ malice must be proved by

extrinsic evidence.” Id. (internal quotation marks and citation

omitted). “Whether a person acts with malice is ordinarily a

question of fact for the jury.” Oparaugo v. Watts, 884 A.2d 63,

82 (D.C. 2005).

PSI take issue only with the second element of defamation,

arguing that a qualified privilege applies because the statement

was published by PSI in its role as Mr. Pannell’s former

employer and Mr. Pannell has failed to allege facts to establish

malice. 2 Mot. to Dismiss, ECF No. 6-1 at 12. The Court agrees

with PSI in part as it is well-settled under District of

Columbia law that there is a qualified privilege for anything

“said or written by a master in giving the character of a

servant who has been in his [or her] employment.” Wallace v.

Skadden, Arps, Slate, Meagher & Flom, 715 A.2d 873, 879 (D.C.

2 PSI also asserts that Mr. Pannell’s “defamation claim fails because PSI had a common interest privilege in responding to an inquiry by federal security authorities as to the reason underlying [his] termination” but provides no legal support for its assertion. Mot. to Dismiss, ECF No. 6-1 at 13. However, the Court need not reach this argument as it has determined that a qualified privilege applies to PSI’s statement to the federal investigator.

10 1998) (internal quotation marks and citation omitted)

(collecting cases). Accordingly, as a matter of law, PSI’s

statement to the investigator is privileged. Since it is a

qualified privilege, however, Mr. Pannell’s burden is to

overcome the presumption that the statement was “actuated by

pure motives” by showing malice on the part of PSI, which here

“must be proved by extrinsic evidence.” Moss, 580 A.2d at 1024.

Making all inferences in Mr. Pannell’s favor, as the Court

must at this juncture, the Court is persuaded that he has

adequately alleged that PSI was “motivated primarily by bad

faith or ill will or enmity” in publishing the allegedly false

statement. Id. at 1026 n.29. Specifically, Mr. Pannell has

alleged that his supervisor, who had treated him in an insolent

and demeaning manner, and whose behavior was going to be

investigated by PSI, contrived the false reason for his

termination based on her ill will toward him. Compl., ECF No. 1-

1 ¶¶ 6, 8, 10. Assuming this to be true, as the Court must at

this juncture, the Court can infer that because the statement

was false, it was published to the investigator primarily to

show malice toward Mr. Pannell rather than to further the

purpose of the qualified privilege. See Payne, 25 A.3d at 926.

PSI argues that Mr. Pannell has failed to allege facts that

establish malice because he has not alleged that his supervisor

was involved in publishing the statement to the federal

11 investigator. However, Mr. Pannell did allege that his

supervisor contrived the reason for his termination and that the

false reason for his termination was published by PSI to the

investigator. Compl., ECF No. 1-1 ¶¶ 14, 20. Accordingly, PSI’s

argument is without merit.

IV. Conclusion and Order

For the reasons explained above, it is

ORDERED that PSI’s Motion to Dismiss, ECF No. 6, is DENIED.

SO ORDERED.

Signed: Emmet G. Sullivan United States District Judge February 22, 2022