UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
VITALY PILKIN,
Plaintiff,
v.
Civil Action No. 17-2501 (RDM)
SONY INTERACTIVE ENTERTAINMENT,
LLC, et al.,
Defendants.
MEMORANDUM OPINION AND ORDER
Plaintiff Vitaly Pilkin is a citizen of the Russian Federation who, appearing pro se, brings
this suit seeking $340 million in damages “based on the doctrine of unjust enrichment.” Dkt. 12
at 2 (Amend. Compl. ¶ 4). On November 13, 2017, Pilkin filed a 152-page single-spaced
complaint asserting claims against Sony Interactive Entertainment LLC, Sony Corporation,
Hogan Lovells US LLP (“Hogan Lovells”), the United States Department of Justice, and then-
Attorney General Jefferson Sessions in his official capacity. See Dkt. 1 at 2, 3. The Court
dismissed the claims against the Department of Justice and Attorney General Sessions on
grounds of sovereign immunity, Dkt. 8 at 3, and, with respect to the remaining defendants,
ordered Pilkin to show cause why the complaint should not be dismissed for failure to comply
with Federal Rule of Civil Procedure 8 or, in the alternative, to file an amended complaint that
satisfied the requirements of Rule 8, Dkt. 9 at 2. Pilkin filed an amended complaint on May 1,
2018, against Sony Interactive Entertainment, Sony Corporation, and Hogan Lovells. Dkt. 12.
On January 16, 2019, the Court dismissed Pilkin’s claim against Sony Interactive Entertainment
for lack of personal jurisdiction. Dkt. 45 at 2. As a result, the only remaining defendants are
Hogan Lovells and Sony Corporation. Sony Corporation has not yet been served. See Minute
Order (Feb. 13, 2019).
Currently before the Court is Hogan Lovells’s motion to dismiss for lack of subject-
matter jurisdiction and for failure to state a claim upon which relief can be granted, Dkt. 26, and
Pilkin’s motion for leave to file a second amended complaint, Dkt. 31. As explained below, the
Court agrees that Pilkin has failed to allege facts sufficient to establish federal question
jurisdiction. In the current procedural posture, however, the Court cannot determine whether
Pilkin can establish diversity jurisdiction. The Court, moreover, cannot decide whether the
amended complaint states a claim upon which relief can be granted without first determining
whether it has subject-matter jurisdiction. As a result, the Court will deny Hogan Lovells’s
motion to dismiss without prejudice. Finally, because Hogan Lovells opposes Pilkin’s motion
for leave to amend solely on the ground that the proposed second amended complaint does not
cure any of the deficiencies identified in Hogan Lovells’s motion to dismiss; because resolution
of those defenses is premature at this time; and because Pilkin’s proposed changes to the
complaint are, in any event, minimal, the Court will grant Pilkin’s motion for leave to amend as a
matter of administrative convenience and without expressing any view on Hogan Lovells’s
defenses.
I. ANALYSIS
“Federal courts are courts of limited jurisdiction” and “possess only that power
authorized by the Constitution and statute.” Kokkonen v. Guardian Life Ins. Co. of Am., 511
U.S. 375, 377 (1994). Moreover, given “the nature and limits of the judicial power of the United
States,” the Court must assess its jurisdiction “as a threshold matter” and may not decide whether
the complaint states a claim on the merits without first addressing the issue of jurisdiction. Steel
2
Co. v. Citizens for a Better Env’t, 523 U.S. 83, 94–95 (1998) (quoting Mansfield, C. & L.M.R.
Co. v. Swain, 111 U.S. 379, 382 (1884)). Pilkin relies on two statutory fonts of federal
jurisdiction: federal question jurisdiction and diversity jurisdiction. See Dkt. 12 at 2 (Amended
Compl. ¶ 3). As explained below, the first cannot support Pilkin’s state-law claim for relief, and
the second will not exist if Sony Corporation is served and remains a party to this action.
A. Federal Question Jurisdiction
Pilkin first argues that this Court has jurisdiction under 28 U.S.C. § 1331, which vests
district courts with “original jurisdiction [over] all civil actions arising under the Constitution,
laws, or treaties of the United States.” The “vast majority of cases brought under the general
federal-question jurisdiction of the federal courts are those in which federal law creates the cause
of action.” Merrell Dow Pharms. Inc. v. Thompson, 478 U.S. 804, 808 (1986). This, however, is
not such a case; the parties agree that Pilkin has not alleged a federal cause of action. Pilkin
alleges only one claim, and that claim is for unjust enrichment. Dkt. 12 at 26 (Amend. Compl.
¶ 93). In support of this common law claim, Pilkin alleges that he was deprived of his Russian
patent rights and that Sony Corporation and Sony Interactive Entertainment were unjustly
enriched at his expense due to an array of alleged wrongful acts, “including the commission of
federal offenses.” Id. at 27 (Amend. Compl. ¶ 94). He alleges, for example, that Hogan Lovells,
Sony Electronics, and others made “false representation[s]” in the patent proceedings in Russia,
engaged in “fraudulent concealment,” “bribed top executives” of the Russian Patent and
Trademark Office, and committed “multiple acts of racketeering activity.” Id. at 27–28 (Amend.
Compl. ¶¶ 94–95). But he does not allege that he is entitled to relief pursuant to any federal
statute or law.
The requirement that a plaintiff allege a federal cause of action in order to invoke federal
question jurisdiction, however, admits of a narrow exception, which the Supreme Court
3
explicated in Grable & Sons Metal Products, Inc. v. Darue Engineering & Manufacturing, 545
U.S. 308, 312 (2005). Under Grable, a state law claim will suffice if, and only if, it “necessarily
raise[s] a stated federal issue,” that is “actually disputed and substantial,” and that “a federal
forum may entertain without disturbing any congressionally approved balance of federal and
state judicial responsibilities.” Gunn v. Minton, 568 U.S. 251, 258 (2013) (alteration in original)
(quoting Grable, 545 U.S. at 314). “Where all” of these “requirements are met,” a district court
may exercise federal question jurisdiction “because there is a ‘serious federal interest in claiming
the advantages thought to be inherent in a federal forum,’ which can be vindicated without
disrupting Congress’s intended division of labor between state and federal courts.” Id. (quoting
Grable, 545 U.S. at 313–14). For several reasons, Pilkin’s unjust enrichment claim does not
satisfy this demanding test.
As an initial matter, Pilkin cannot show that a federal question is “necessarily raised” by
his unjust enrichment claim. Gunn, 568 U.S. at 258. To be sure, he points to a host of federal
statutes that he alleges Defendants violated. But he is clear that those purported acts of
wrongdoing are not exclusive and that his claim of unjust enrichment is premised, at least in the
alternative, on various “fraudulent representations” and acts of “fraudulent concealment and
nondisclosure.” Dkt. 12 at 27 (Amend. Compl. ¶27). The fact that he also alleges violations of
numerous federal statutes—again, exclusively in service of his unjust enrichment claim—may
add gravity to his claim, but his cause of action does not turn on whether any federal statute was
violated. For a federal issue to be “necessarily raised,” “vindication of [the] right [asserted]
under state law [must] necessarily turn[] on some construction of federal law.” Franchise Tax
Bd. of Cal. v. Constr. Laborers Vacation Trust for S. Cal., 463 U.S. 1, 9 (1983). That is not the
case here.
4
Pilkin’s effort to invoke § 1331 also founders on the substantiality requirement. See
Grable, 545 U.S. at 313. Under that prong of the test, “it is not enough that the federal issue be
significant to the particular parties in the immediate suit.” Gunn, 568 U.S. at 260 (quoting
Grable, 545 U.S. at 314). “The substantiality inquiry under Grable looks instead to the
importance of the issue to the federal system as a whole.” Id. Accordingly, “[w]here state-law
claims implicate federal statutes or regulations, but do not involve disputes as to their meaning,
courts have uniformly found federal jurisdiction under Grable lacking.” Wash. Consulting Grp.,
Inc. v. Raytheon Tech. Servs. Co., LLC, 760 F. Supp. 2d 94, 106 (D.D.C. 2011); see also Pritika
v. Moore, 91 F. Supp. 3d 553, 558 (S.D.N.Y. 2015) (“[C]ourts have typically found a substantial
federal issue only in those exceptional cases that go beyond the application of some federal legal
standard to private litigants’ state law claims, and instead implicate broad consequences to the
federal system or the nation as a whole.”).
As the Supreme Court observed in Gunn, two examples illustrate the kind of unique
circumstances that justify extending federal question jurisdiction to state law claims. The first
example comes from Grable itself. In that case, the Internal Revenue Service (“IRS”) seized a
parcel of property belonging to the plaintiff, Grable & Sons Metal Products, to satisfy a tax
delinquency. 545 U.S. at 310. Years later, after the IRS had sold the property to a third party,
Grable & Sons brought a quiet title action asserting a superior interest in the property on the
theory that the IRS had failed to provide the notice required under federal law, thus invalidating
the seizure and subsequent sale. Id. at 311. As the Supreme Court explained, the allegation that
Grable & Sons was not provided the notice required by federal law formed an essential element
of the claim; the case posed only a legal—and not a factual—dispute; and “[t]he meaning of the
federal tax provision [was] an important issue of federal law that sensibly belong[ed] in a federal
5
court,” particularly given the federal government’s “strong interest in the ‘prompt and certain
collection of delinquent taxes.’” Id. at 315 (internal citation omitted). In deciding that the case
raised a “significant” federal issue, the Supreme Court “focused not on the interests of the
litigants themselves, but rather on the broader significance of the notice question for the Federal
Government.” Gunn, 568 U.S. at 260.
The second example comes from a case discussed in Grable: Smith v. Kansas City Title
& Trust Co., 255 U.S. 180 (1921). Grable described Smith as “[t]he classic example” of a state-
law claim that raises a significant federal issue. 545 U.S. at 312. In Smith, the plaintiff brought
suit “claiming that the defendant corporation could not lawfully buy certain bonds of the
National Government because their issuance was unconstitutional.” Id. As the Court explained
in Grable, even though state law “provided the cause of action,” the district court had federal
question jurisdiction “because the principal issue in the case was the federal constitutionality of
the bond issue.” Id. Again, the Supreme Court premised its holding on the existence of “a
serious federal interest” in the “principal issue” raised by the litigation. Id. at 312–13.
Like other cases that the Supreme Court has characterized as “poles apart from Grable”
and Smith, Empire Healthchoice Assurance, Inc. v. McVeigh, 547 U.S. 677, 700 (2006); see also
Gunn, 568 U.S. at 262, Pilkin’s unjust enrichment claim does not turn on an important question
of federal law. The central issue in the case is not a “pure issue of law” that might affect a
federal interest; rather, the case raises a “fact-bound and situation-specific” question about
whether Defendants deprived Pilkin of his interest in a Russian patent by means of wrongful
conduct, such as bribery or fraudulent misrepresentations. Empire Healthchoice Assurance, Inc.,
547 U.S. at 700–01 (internal citations omitted). There is no reason to believe that Pilkin’s claim
that Defendants were unjustly enriched through their wrongful conduct rises or falls based on
6
whether the alleged misconduct—bribery and fraudulent misrepresentations—violated federal, as
opposed to state or foreign, law.
There is no “‘single, precise, all-embracing’ test for jurisdiction over federal issues
embedded in state-law claims between nondiverse parties.” Grable, 545 U.S. at 314 (quoting
Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 821 (1988) (Stevens, J., concurring)).
As the plaintiff in this action, however, Pilkin bears the burden of alleging facts or offering
evidence sufficient to establish federal jurisdiction, and he has failed to offer any basis for this
Court to conclude that this is one of those “extremely rare” cases in which a state-law claim
necessarily implicates significant federal questions of law that warrant a federal tribunal. Gunn,
568 U.S. at 257.
The Court, accordingly, concludes that it does not have federal question jurisdiction over
Pilkin’s common law unjust enrichment claim.
B. Diversity Jurisdiction
Pilkin also avers that the Court has diversity jurisdiction. Dkt. 12 at 2 (Amended Compl.
¶ 3). The district courts’ diversity jurisdiction extends to “all civil actions where the matter in
controversy exceeds the sum or value of $75,000 . . . and is between . . . citizens of a State and
citizens or subjects of a foreign state.” 28 U.S.C. § 1332(a). Unlike Article III, however, the
diversity statute has been long construed to require complete diversity. Ruhrgas AG v. Marathon
Oil Co., 526 U.S. 574, 580 n.2 (1999); Saadeh v. Farouki, 107 F.3d 52, 55 (D.C. Cir. 1997). The
complete diversity requirement, moreover, applies “in cases involving alien parties.” Saadeh,
107 F.3d at 55. As a result, “the diversity statute [does] not confer jurisdiction over a lawsuit
involving an alien on one side, and an alien and citizen on the other side.” Id.; see also Ruhrgas
AG, 526 U.S. at 580 n.2 (“The foreign citizenship of defendant Ruhrgas, a German corporation,
and plaintiff Norge, a Norwegian corporation, rendered diversity incomplete.”). As Hogan
7
Lovells correctly observes, Dkt. 26-1 at 11–12, the complete diversity requirement means that
this Court would lack diversity jurisdiction over a claim by Pilkin, a Russian citizen, against
Sony Corporation, “a foreign corporation headquartered . . . [i]n Japan,” Dkt. 12 at 2 (Amend.
Compl. ¶¶ 1–2). The absence of complete diversity, moreover, deprives the Court of diversity
jurisdiction over the entire action and not merely Pilkin’s claim against Sony Corporation.
Under these circumstances, the Court might exercise its discretion under Federal Rule of Civil
Procedure 21 to dismiss Sony Corporation for the action as a “so-called ‘jurisdictional
spoiler[.]’” In re Lorazepam & Clorazepate Antitrust Litig., 631 F.3d 537, 542 (D.C. Cir. 2011)
(internal citation omitted); see also Grupo Dataflux v. Atlas Glob. Grp., L.P., 541 U.S. 567, 573–
74 (2004) (quoting Newman-Green, Inc. v. Alfonzo-Larrain, 490 U.S. 826, 832 (1989)).
Before taking that step, however, the Court will provide the parties with the opportunity
to be heard on the issue. If Sony Corporation is an indispensable party, for example, the Court
may not drop the company under Rule 21. See generally 7 Charles Alan Wright and Arthur R.
Miller, Federal Practice and Procedure § 1685 (3d ed. 2018) (“Wright & Miller”). Or, Pilkin
might decide that he is prepared to forgo a federal forum if the price of proceeding in federal
court is the dismissal of Sony Corporation. See, e.g., Singletary v. Cont’l Illinois Nat. Bank &
Tr. Co. of Chicago, 9 F.3d 1236, 1238 (7th Cir. 1993) (“If a plaintiff wants to retain a nondiverse
defendant, it is no business of the court to tell him he can’t; the court’s job in such a case is to
tell the plaintiff that he can’t stay in federal court.”) On the other hand, it is possible that Pilkin’s
claim against Sony Corporation, like his claim against Sony Interactive Entertainment, will not
survive a motion to dismiss for lack of personal jurisdiction, at least raising the question whether
Sony Corporation’s status as a named party over which the Court (hypothetically) lacks personal
jurisdiction is sufficient to defeat complete diversity. See Brown v. Eli Lilly & Co., 654 F.3d
8
347, 356–57 (2d Cir. 2011) (granting summary judgment in favor of the non-diverse party). For
present purposes, the Court merely concludes that its subject-matter jurisdiction is in doubt and
that, until that doubt is resolved, it may not reach Hogan Lovells’s motion to dismiss for failure
to state a claim.
C. Motion for Leave to Amend
Rule 15 dictates that the Court “should freely give leave [to amend] when justice so
requires,” Fed. R. Civ. P. 15(a)(2). “It is within the sound discretion of the district court to
decide whether to grant such leave.” Williamsburg Wax Museum, Inc. v. Historic Figures, Inc.,
810 F.2d 243, 247 (D.C. Cir. 1987); see also Zenith Radio Corp. v. Hazeltine Research, Inc., 401
U.S. 321, 330 (1971). Here, Hogan Lovells opposes Pilkin’s motion for leave to amend solely
on the ground that it would be futile, asserting that the proposed second amended complaint does
not cure any of the deficiencies identified in its motion to dismiss. See Dkt. 32 at 2 (“None of
these proposed changes address the numerous grounds upon which [Hogan Lovells] ha[s]
already moved to dismiss the Amended Complaint.”). That contention, however, raises the same
difficulties posed by Hogan Lovells’s motion under Rule 12(b)(6)—the Court must avoid
considering the merits of Pilkin’s allegations until it is satisfied that it has subject-matter
jurisdiction. Moreover, as the parties here agree, the proposed amendment differs from the
Amended Complaint in only minor respects, see Dkt. 32 at 2; Dkt. 31 at 2. As a result, Hogan
Lovells will not suffer any prejudice from such an amendment. See Zenith Radio Corp., 401
U.S. at 330–31.
The Court will, accordingly, grant Pilkin’s motion for leave to amend as a matter of
administrative convenience and without expressing any view on Hogan Lovells’s defenses.
9
CONCLUSION
In the current posture of the case, the Court cannot determine whether it has jurisdiction
to reach the merits of Hogan Lovells’s motion to dismiss for failure to state a claim. The Court,
accordingly, DENIES Hogan Lovells’s motion to dismiss, Dkt. 26, without prejudice, as
premature. As a matter of administrative convenience, and without passing on the legal
sufficiency of the second amended complaint, the Court GRANTS Pilkin’s motion for leave to
amend, Dkt. 31, and DEEMS Pilkin’s second amended complaint as filed. Hogan Lovells’s time
to answer or otherwise respond to the second amended complaint, however, is extended until 21
days after Sony Corporation either appears in this action or moves to dismiss for lack of personal
jurisdiction.
SO ORDERED.
/s/ Randolph D. Moss
RANDOLPH D. MOSS
United States District Judge
Date: February 14, 2019
10