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Falcone v. Altarock Energy, Inc.

United States District Court, W.D. Washington, Seattle

April 7, 2017

DOMENIC J. FALCONE, Plaintiff,
v.
ALTAROCK ENERGY, INC., Defendant.

          ORDER

          Honorable Richard A. Jones United States District Judge

         This matter comes before the Court upon Defendant AltaRock Energy, Inc.'s Motion for Summary Judgment. Dkt. # 20. Plaintiff Domenic Falcone opposes the motion. Dkt. # 24. For the reasons that follow, the Court DENIES the motion.

         I. BACKGROUND

         Plaintiff entered into a consulting relationship with Defendant for the purpose of providing “business advisory services.” Dkt. # 21-1. According to the parties' Agreement, Defendant agreed to pay Plaintiff both a monthly retainer as well as a success fee. Id. at p. 9. The success fee was to be paid “[u]pon the closing of a transaction where [Plaintiff] has played a significant role in both introducing the party to [Defendant] and in facilitating the negotiations of the transaction.” Id.

         In November 2013, Plaintiff facilitated a negotiation between Defendant and Blue Mountain Power, LLC. Dkt. # 21-2. The parties drafted a binding term sheet in which Defendant would purchase a company that indirectly owned a geothermal power project. Id. The purpose of the transaction was for Defendant to own “all of the equity interests of the” company. Id. The parties terminated the negotiations, and in January 2014, Defendant ended its relationship with Plaintiff. Dkt. # 21 (Mandell Decl.) at ¶¶ 3-4. However, in early 2015, Defendant executed an agreement to purchase 100% of the equity in the company that owned the geothermal power project. Id. at ¶¶ 6-7. On May 13, 2015, the deal closed. Id. at ¶ 7. The final agreement contains many similarities to the unsuccessful term sheet drafted during Plaintiff's tenure as Defendant's consultant. Accordingly, Plaintiff sued Defendant for a success fee. In its motion for summary judgment, Defendant counters that Plaintiff is barred from suing for such a fee due to Washington's Real Estate Brokers and Salesperson Act, codified at Chapter 18.85 in Title 18 of the Revised Code of Washington.

         II. LEGAL STANDARD

         Summary judgment is appropriate if there is no genuine dispute as to any material fact and the moving party is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a). The moving party bears the initial burden of demonstrating the absence of a genuine issue of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Where the moving party will have the burden of proof at trial, it must affirmatively demonstrate that no reasonable trier of fact could find other than for the moving party. Soremekun v. Thrifty Payless, Inc., 509 F.3d 978, 984 (9th Cir. 2007). On an issue where the nonmoving party will bear the burden of proof at trial, the moving party can prevail merely by pointing out to the district court that there is an absence of evidence to support the non-moving party's case. Celotex Corp., 477 U.S. at 325. If the moving party meets the initial burden, the opposing party must set forth specific facts showing that there is a genuine issue of fact for trial in order to defeat the motion. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 250 (1986). The court must view the evidence in the light most favorable to the nonmoving party and draw all reasonable inferences in that party's favor. Reeves v. Sanderson Plumbing Prods., 530 U.S. 133, 150-51 (2000).

         However, the court need not, and will not, “scour the record in search of a genuine issue of triable fact.” Keenan v. Allan, 91 F.3d 1275, 1279 (9th Cir. 1996); see also White v. McDonnell-Douglas Corp., 904 F.2d 456, 458 (8th Cir. 1990) (the court need not “speculate on which portion of the record the nonmoving party relies, nor is it obliged to wade through and search the entire record for some specific facts that might support the nonmoving party's claim”). The opposing party must present significant and probative evidence to support its claim or defense. Intel Corp. v. Hartford Accident & Indem. Co., 952 F.2d 1551, 1558 (9th Cir. 1991). Uncorroborated allegations and “self-serving testimony” will not create a genuine issue of material fact. Villiarimo v. Aloha Island Air, Inc., 281 F.3d 1054, 1061 (9th Cir. 2002); T.W. Elec. Serv. v. Pac Elec. Contractors Ass'n, 809 F.2d 626, 630 (9th Cir. 1987).

         III. DISCUSSION

         A. The Court will not add “business opportunities” to RCW 18.85.011(16).

         In its motion, Defendant relies on RCW 18.85.331 to argue that Plaintiff may not collect his success fee. See, generally, Dkt. # 20. In relevant part, RCW 18.85.331 provides that:

No suit or action shall be brought for the collection of compensation as a real estate broker, real estate firm, managing broker, or designated broker, without alleging and proving that the plaintiff was a duly licensed real estate broker, managing broker, or real estate firm before the time of offering to perform any real estate transaction or procuring any promise or contract for the payment of compensation for any contemplated real estate transaction.

Wash. Rev. Code Ann. § 18.85.331 (West). According to the Code, real estate brokers, real estate firms, managing brokers, and designated brokers perform “real estate brokerage services.” RCW 18.85.011(2), (10), (14), (17). “Real estate brokerage services” include a litany of services related to real estate “offered or rendered directly or indirectly to another, or on behalf of another for compensation or the promise or expectation of compensation . . . .” RCW 18.85.011(16).

         Defendant argues that the Code's definition of “real estate brokerage services” previously included the purchase of “business opportunities” as a brokerage service and therefore the Court should continue to read this into the current version of the provision. Dkt. # 20 at p. 6. However, the legislature revised this Code section in 2010 such that “business opportunities” is no longer included within the definition of “real estate brokerage services.” Compare RCW 18.85.010 with RCW 18.85.011. Defendant relies on outdated case law and secondary sources, as well as two separate and distinct ...


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