Zhou Jie Plant v. Merrifield Town Center Ltd. Partnership

Affirmed by unpublished PER CURIAM opinion. Unpublished opinions are not binding precedent in this circuit. PER CURIAM: The plaintiffs-appellants are purchasers of condominiums in Falls Church, Virginia. 1 Relying on the Interstate Land Sales Full Disclosure Act (“ILSFDA”), 15 U.S.C. §§ 1701 et seq., they brought this action against the developer of the condominiums seeking rescission of their condominium sales contracts and the return of their purchase deposits. During the course of its thorough consideration of this protracted litigation, 2 the district court entered two orders that are the subject of this appeal. After carefully considering all of the parties’ arguments, we affirm. First, after warning the Fitzgerald appellants that their failure to comply with *826 certain discovery orders could lead to sanctions including dismissal, the district court dismissed them from the case based on their continued noncompliance. Plant v. Merrifield Town Ctr. Ltd. Partnership, 711 F.Supp.2d 576 (E.D.Va.2010) (“Plant 7”). Applying the four factors set forth in Anderson v. Foundation for Advancement, Education & Employment of American Indians, 155 F.3d 500 (4th Cir.1998), the court found: (1) “bad faith is clearly evidenced by the repeated and flagrant disregard for the binding orders of the magistrate judge and plaintiffs’ counsel’s misrepresentation of material facts concerning plaintiffs’ noncompliance with these orders;” (2) “the scope and length of the violations have clearly resulted in prejudice to defendants;” (3) “dismissal is necessary for purposes of deterrence;” and (4) “it is plain from the nature of the conduct in issue that a lesser remedy would be inadequate to provide a sufficient deterrent to noncompliant plaintiffs and their counsel from similar conduct in the future.” Plant I, 711 F.Supp.2d at 587. The Fitzgerald appellants appeal this order. We review a sanction dismissal order for abuse of discretion. Anderson, 155 F.3d at 504. A district court abuses its discretion when it acts arbitrarily or irrationally, fails to consider judicially recognized factors constraining its exercise of discretion, relies on erroneous factual or legal premises, or commits an error of law. United States v. Thompson-Riviere, 561 F.3d 345, 348 (4th Cir.2009). Viewed under this deferential standard of review, we easily conclude that the court did not abuse its discretion by imposing this sanction. Second, in Plant II, the district court entered summary judgment against the Altmiller appellants on their ILSFDA claim, holding that they could not recover for the developer’s failure to make certain ILSFDA-mandated disclosures. The court noted that because the Altmiller appellants did not seek automatic rescission under the ILSFDA in a timely manner, they were limited to the remedy of equitable rescission under 15 U.S.C. § 1709. The court found that the Altmiller appellants failed to establish, as a necessary element, that the developer’s ILSFDA non-disclosures “were material in that they would have influenced a reasonable purchaser’s decision to enter into the contract for sale.” 751 F.Supp.2d at 866. As the court explained: [A]n evidentiary hearing revealed that the undisclosed information required by ILSFDA would have been well-known or unimportant to a reasonable purchaser of these relatively expensive condominiums in a well-established, affluent area of Fairfax. This result is unsurprising given that the purpose of ILSF-DA was to prevent fraud in the sales of real property in more undeveloped areas, such [as] property in a flood plain or more than one hundred miles from the nearest fire station. A different result might have been obtained had sales of the property been located in some area where the information required by ILSFDA would likely have been objectively material. Given the lack of objective materiality, plaintiffs cannot demonstrate an entitlement to equitable rescission. Simply put, the circumstances of this case do not call for the exercise of the court’s broad equitable powers in pursuit of “general fairness.” Id. at 875. All of the appellants appeal this order. We review an order granting summary judgment de novo. Laber v. Harvey, 438 F.3d 404, 415 (4th Cir.2006) (en banc). Summary judgment is appropriate if “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. *827 R.Civ.P. 56(a). Based substantially on the reasoning of the district court, we conclude that the court did not err in granting summary judgment. See also Nahigian v. Juno-Loudoun, LLC, 677 F.3d 579, 586-87 (4th Cir.2012) (holding that materiality is a necessary element of an equitable rescission claim under ILSFDA). Based on the foregoing, we affirm. We dispense with oral argument because the facts and legal contentions are adequately presented in the materials before the court and argument would not aid the decisional process. AFFIRMED. Footnotes [1] Although unified below, the plaintiffs-appellants have split into separate groups on appeal. One group ("the Altmiller appellants”) is represented by John C. Altmiller and Alexander Laufer. The other group ("the Fitzgerald appellants”) is represented by Henry St. John Fitzgerald. [2] The pertinent factual background and procedural history of this case is set forth in Plant v. Merrifield Town Center Ltd. Partnership, 751 F.Supp.2d 857 (E.D.Va.2010) {“Plant II”), and we need not restate it here.