DC United
DC United
DC United
Plaintiffs DC Soccer, LLC (“DC Soccer”) and DC Stadium LLC (“DC Stadium,” and,
together with DC Soccer, “D.C. United” or the “Plaintiffs”), by way of their Complaint against
Defendants CapX Office Solutions, LLC (“CapX Office”), CapX Solutions, LLC (“CapX
Solutions,” and, together with CapX Office, “CapX”) and John Vassos (“Vassos,” and together
PRELIMINARY STATEMENT
partners of D.C. United. Plaintiffs collectively operate D.C. United, a professional soccer club in
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Major League Soccer (“MLS”), and Audi Field, the newly-constructed stadium in which D.C.
United plays. Defendants signed agreements to be valued partners of D.C. United, including a
sponsorship agreement and a suite lease. Defendants have failed to make the payments required
by those agreements. Additionally, Defendants, which purportedly operate an office furniture and
equipment supply firm, caused Plaintiffs additional damage through duplicate billing and other
wrongful acts concerning the construction of D.C. United’s office space and leases of copiers and
furniture. Plaintiffs are entitled to be compensated for the damages caused by Defendants.
THE PARTIES
successful teams in MLS, the premier American soccer league, having won the MLS Cup on four
occasions.
ground lease with the District of Columbia through which it operates Audi Field.
4. CapX Office is a Maryland limited liability company with its principal place of
5. CapX Solutions is a Maryland limited liability company with its principal place of
business at 6700A Rockledge Drive, Suite #330, Bethesda, Maryland 20817. Upon information
and belief, CapX Office and CapX Solutions are intended to be different entities reflecting
JURISDICTION
7. The Court has original jurisdiction pursuant to 28 U.S.C. § 1332(a) as this is a civil
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action between citizens of different states and the amount in controversy exceeds $75,000,
exclusive of interest and costs. There is complete diversity of citizenship between Plaintiffs and
Defendants.
8. The Court has personal jurisdiction over Defendants as they regularly do business
in the District of Columbia, and because the conduct at issue in this action arises out of Defendants’
FACTUAL ALLEGATIONS
10. Effective April 4, 2018, DC Soccer and CapX entered into a Local Sponsor
Agreement (the “Sponsorship Agreement”) whereby CapX became an official partner of D.C.
United. A true and correct copy of the Sponsorship Agreement is attached hereto as Exhibit (1).
11. As part of the Sponsorship Agreement, CapX received, among other benefits, the
right to:
f. have CapX logos, marks and other intellectual property incorporated into D.C.
United communications, promotions and social media posts; and,
12. In exchange for the above-listed benefits, CapX agreed to pay DC Soccer a total of
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a. 2018: $50,000.00
b. 2019: $90,000.00
c. 2020: $115,000.00
d. 2021: $140,000.00
e. 2022: $165,000.00
13. On or about August 15, 2018, the parties amended the Sponsorship Agreement (the
“Addendum”). A true and correct copy of the Addendum is attached hereto as Exhibit (2).
14. The Addendum provided CapX with the right to additional advertising and
sponsorship activation with D.C. United and at Audi Field. In exchange, CapX agreed to make
a. 2018: $135,000.00
b. 2019: $175,000.00
c. 2020: $200,000.00
d. 2021: $225,000.00
e. 2022: $250,000.00
15. In total, the Addendum increased CapX’s financial obligations by $85,000 per year,
16. While CapX made the required 2018 payment on the Sponsorship Agreement,
CapX has failed to make any payment for 2019 and beyond.
17. CapX owes D.C. United a total of $850,000.00 on the Sponsorship Agreement.
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18. In addition to permitting CapX to use D.C. United logos and marks and to be
identified as a D.C. United partner, D.C. United provided CapX with substantial sponsorship
benefits during the 2019 season, including but not limited to:
19. As part of the Sponsorship Agreement, CapX entered into an Audi Field Suite
Lease Agreement (the “Suite Lease”) whereby CapX agreed to rent a luxury suite for all D.C.
United matches at Audi Field. See Exhibit (1) (Sponsorship Agr., Ex. C).
20. CapX took advantage of the Suite Lease by attending many D.C. United games
21. The annual fee for the Suite Lease was $85,000.00 per year from 2018 through
2022.
22. While CapX made the required 2018 payment on the Suite Lease, CapX has only
23. CapX owes D.C. United a total of $318,750.00 on the Suite Lease.
24. By agreement dated August 28, 2019, DC Stadium agreed to lease office furniture
from CapX for a monthly payment of $9,127.15 for 60 months, for a total of $547,629 (the
“Furniture Lease”). A true and correct copy of the Furniture Lease is attached hereto as Exhibit
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(3). DC Stadium also agreed to pay CapX $51,792.50 for the delivery and installation of the office
furniture.
25. By invoice dated September 14, 2018 (Invoice #1348), CapX invoiced DC Stadium
$60,919.65 for the first payment of the Furniture Lease and the related delivery and installation.
26. By invoice also dated September 14, 2018 (Invoice #1349), CapX invoiced DC
27. By invoice dated October 15, 2018 (Invoice #1393), CapX invoiced DC Stadium
for $18,254.30 for the October and November payments of the Furniture Lease.
28. By invoice also dated October 15, 2018 (Invoice #1394), CapX invoiced DC
Stadium for $16,894.08 related to electrical work CapX performed at D.C. United’s offices.
29. On November 6, 2018, DC Stadium paid Invoice ##1348 and 1349 through a draw
30. Despite having been paid by DC Stadium on Invoices ##1348 and 1349, CapX
harassed D.C. United for payment on the invoices, insisting that they had not been paid in multiple
emails and telephone calls. CapX also insisted on immediate payment of Invoices ##1393 and
1394.
31. CapX made these requests to Greg Burie, D.C. United’s Vice President of Finance.
Notably, Burie only joined D.C. United a few weeks earlier in early October 2018, and he was not
involved in the November Draw. Moreover, D.C. United had been without any financial
professionals for weeks prior to Burie’s having been hired, resulting in an unfortunately confused
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32. In response to CapX’s repeated and erroneous demands for payment, on November
29, 2018, Burie facilitated wire payments to CapX for Invoices ##1348, 1349, 1393, and 1394
(collectively, the “Office Invoices”), thus duplicating payment on Invoices ##1348 and 1349.
33. Around the same time, Burie arranged for Invoices ## 1393 and 1394 to be paid
through the construction loan draw. Indeed, on December 17, 2018, Invoices #1393 and 1394
34. Consequently, through their harassment of D.C. United’s new and overwhelmed
35. On July 12, 2018, DC Stadium and CapX entered into an agreement whereby DC
Stadium leased five copy machines from CapX (the “First Copier Lease”). A true and correct copy
of the First Copier Lease is attached hereto as Exhibit (4). The First Copier Lease required DC
36. The First Copier lease identified the five copy machines as follows:
37. On July 13, 2018, the day after the execution of the First Copier Lease, CapX
assigned its rights for the first 18 monthly payments under the First Copier Lease to Noreast Capital
Corporation (“Noreast”).
38. Next, in exchange for entering into the Addendum to the Sponsorship Agreement,
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39. Consequently, on September 11, 2018, DC Stadium entered into a lease agreement
with Marlin Leasing Corporation (“Marlin”) whereby DC Stadium leased five copy machines from
Marlin (the “Second Copier Lease,” and with the First Copier Lease, the “Copier Leases”). A true
and correct copy of the Second Copier Lease is attached hereto as Exhibit (5). The Second Copier
Lease required DC Stadium to make 60 monthly payments of $5,895.00, for a total of $353,700.00.
40. Notably, the annual cost of the Second Copier Lease ($70,740.00) was roughly
equivalent to the increase in CapX’s annual financial obligations as result of the Addendum
($85,000.00).
41. This was not a coincidence – it was the parties’ intention that the amount CapX
spent with D.C. United roughly equaled the amount D.C. United spent with CapX. Based on
CapX’s representations, it was D.C. United’s understanding that Marlin would be compensating
CapX for amounts received under the Second Copier Lease or that there was some equivalent
42. The Second Copier lease also identified the five copy machines as follows:
43. In fact, the Second Copier Lease was for the exact same copiers covered by the
First Copier Lease. Indeed, CapX represented to D.C. United that the Second Copier Lease
44. CapX’s representation proved to be false, and DC Stadium was forced to make
payments on both the First Copier Lease (to Noreast) and the Second Copier Lease (to Marlin),
even though the Copier Leases were for the same five copiers.
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45. Between July 2018 and June 2019, DC Stadium was invoiced for and paid Noreast
$74,096 on the First Copier Lease. During the same period of time, DC Stadium was invoiced and
46. After being confronted with this information in July 2019, CapX arranged for the
release of the First Copier Lease with Noreast. Consequently, as of July 2019, DC Stadium is only
paying the Second Copier Lease. Nevertheless, DC Stadium has already been damaged by the
47. In the spring of 2019, and extending into the summer, D.C. United informed CapX
that it was in default on its obligations under the Sponsorship Agreement and the Suite Lease.
D.C. United also demanded repayment for the Office Invoices and the duplicate payments made
48. In a June 19, 2019 email, Blake Esherick (“Esherick”), the then-Chief Operating
Officer of CapX, told Burie, “Please send the most recent Marlin invoice to me. You should just
49. Burie responded by providing CapX with the dates and amounts of payments made
by DC Stadium to Marlin pursuant to the Second Copier Lease, which, at that time, totaled
$51,001.91.
50. Esherick, on behalf of CapX, replied by admitting CapX’s liability for the Second
Copier Lease: “You should be paying the Noreast invoices. We will reimburse DC United for the
above referenced payments already paid to Marlin and CapX will make sure that the Marlin lease
is satisfied.”
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51. On July 2, 2019, Christopher Deubert, D.C. United’s General Counsel, had a
telephone call with Esherick concerning CapX’s outstanding obligations. Immediately following
the call, Deubert sent an email to Esherick (copying Vassos) confirming the substance of the call
as follows:
2. By the end of next week, CapX will also make a payment to cover the
amounts we have been billed in duplicate for the copier leases. By our
calculations, this amount is currently $46,734.17.
3. You have told us that we should no longer pay the Noreast invoices, which
you admitted contradicted your earlier direction to not pay Marlin. Either
way, we will need written documentation from either Noreast or Marlin
understanding that we will no longer be making payment to them.
4. You indicated you were not involved in the process by which our leases
were assigned or otherwise transferred to Noreast and Marlin. As I
indicated, we are skeptical and unsure of how it is that CapX appears to
have assigned our same lease twice.
5. You confirmed that CapX is currently having cash flow issues resulting in
the delayed payments.
52. After CapX did not make the promised $50,000.00 payment, D.C. United learned
53. On July 11, 2019 Vassos responded to the above-referenced email chain by
promising to have D.C. United fully paid “by the end of Aug. 2019.”
54. In the same email, Vassos again admitted CapX’s liability concerning the Copier
Leases:
I understand there was a billing issue that had to do with CapX originally holding
the copier equipment lease and then having Marlin bill it as well. What I believe
actually happened is that this lease was supposed to have been closed out . . . . I
believe that we owe you for duplicate payments made on the copier leases to both
CapX Financial/Noreast and Marlin thru July 2019. Please, moving forward do not
make any further payments on [the First Copier Lease]. We will be shutting that
lease off. You should pay Marlin for the equipment lease moving forward.
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55. Deubert and Vassos spoke by phone later that day on July 11, 2019 during which
Vassos admitted that CapX owed D.C. United for the Sponsorship Agreement, the Suite Lease the
Office Invoices and the Copier Leases. The next morning, on July 12, 2019, Deubert summarized
You also informed me that you were not previously aware of the full amounts owed by
CapX to D.C. United. Those amounts are as follows:
We can provide backup and clarity on these numbers as needed. You promised to
make D.C. United whole on these outstanding obligations by the end of
August. Next week we will construct a proposed payment schedule to effectuate
that.
56. After Vassos did not respond to Deubert’s email and subsequent follow ups,
Deubert and Vassos spoke by telephone on August 1, 2019. In that telephone call, Vassos told
Deubert that CapX and/or Vassos would soon be receiving funds for which it would make a
57. In the August 1, 2019 telephone call, Vassos also told Deubert that D.C. United
would soon receive paperwork from Noreast to effectuate the satisfaction and termination of the
58. Vassos has repeatedly represented to D.C. United that he has a terminal illness.
While D.C. United does not dispute the existence of and has sympathy for Vassos’ illness, Vassos
should nonetheless be held personally liable for the damages owed by CapX in this matter.
59. In his July 11, 2019 email, Vassos told D.C. United that he had “made arrangements
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to dip into some financial resources to get you guys completely paid to date by the end of Aug.
2019.”
60. Vassos’ vague reference to “financial resources” made more sense two weeks later.
On July 26, 2019, Vassos forwarded to D.C. United an email chain between Vassos and NFP, an
insurance broker. In the email, NFP representatives (with Vassos copied) are discussing when
Vassos would be eligible to receive accelerated death benefit payments from Vassos’ life insurance
policy.
61. Upon information and belief, Vassos forwarded the email to D.C. United because
it was his intention to pay the amounts owed by CapX to D.C. United with the proceeds from
62. Vassos’ apparent intention to pay off the liabilities of CapX with his personal
money demonstrates the commingling of funds between Vassos and CapX, insufficient
capitalization on the part of CapX, and a disregard for CapX’s corporate formalities. For these
reasons, the corporate veil must be pierced and Vassos held personally liable for CapX’s liabilities.
63. By letter dated September 25, 2019, D.C. United advised CapX that it had failed to
make the payments required by the Sponsorship Agreement and the Suite Lease and demanded
payment within the applicable cure periods (the “September 25 Letter”). In that same letter, D.C.
United demanded repayment related to the Office Invoices and Copier Leases. A true and correct
65. On October 11, 2019, pursuant to the terms of the Sponsorship Agreement and Suite
Lease, D.C. United terminated the Sponsorship Agreement and Suite Lease as a result of CapX’s
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66. In response to the Termination Notice, on October 11, 2019, Vassos sent Deubert
an e-mail in which Vassos stated: “Without question, we [CapX] owe you [D.C. United] the money
outlined in your previous letters and need to start getting you paid.”
67. To date, D.C. United has not received the additional payments Vassos and CapX
promised it under the Sponsorship Agreement, the Suite Lease, or as reimbursement for the
CAUSES OF ACTION
COUNT I
(Breach of Contract – the Sponsorship Agreement)
68. D.C. United repeats and realleges the allegations set forth above as if fully set forth
herein.
70. D.C. United at all times performed its obligations under the Sponsorship
Agreement.
71. CapX breached the Sponsorship Agreement by not paying the amounts owed under
72. As a direct and proximate cause of CapX’s breach of the Sponsorship Agreement,
D.C. United has been damaged in an amount to be determined at trial, but not less than $850,000
73. Additionally, for the reasons stated above, Vassos is personally liable for CapX’s
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COUNT II
(Breach of Contract – the Suite Lease)
74. D.C. United repeats and realleges the allegations set forth above as if fully set forth
herein.
76. D.C. United at all times performed its obligations under the Suite Lease.
77. CapX breached the Suite Lease by not paying the amounts owed under the Suite
Lease, totaling $318,750.00. Section 14 of the Suite Lease permits D.C. United, upon CapX’s
default, to “declare the entire unpaid balance of the [Suite Lease]... immediately due and payable.”
78. As a direct and proximate cause of CapX’s breach of the Suite Lease, D.C. United
has been damaged in an amount to be determined at trial, but not less than $318,750.00 on the
Suite Lease.
79. Additionally, for the reasons stated above, Vassos is personally liable for CapX’s
COUNT III
(Conversion – the Office Invoices)
80. D.C. United repeats and realleges the allegations set forth above as if fully set forth
herein.
81. CapX has unlawfully exercised ownership, dominion, and control over D.C.
United’s property, specifically the $110,183.68 paid in duplicate to CapX for the Office Invoices,
82. As a direct and proximate cause of CapX’s conversion, D.C. United has been
damaged in an amount to be determined at trial, but not less than $110,183.68 on the Office
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83. Additionally, for the reasons stated above, Vassos is personally liable for CapX’s
conversion.
COUNT IV
(Negligent Misrepresentation – the Office Invoices)
84. D.C. United repeats and realleges the allegations set forth above as if fully set forth
herein.
85. Pursuant to the Furniture Lease, DC Stadium paid Invoice ##1348 and 1349 with
86. Despite having been paid by DC Stadium on Invoices ##1348 and 1349, CapX
harassed D.C. United for payment on the invoices, insisting that they had not been paid in multiple
87. Additionally, despite the fact that Invoices ## 1393 and 1994 had previously been
paid through a construction loan draw, DC Stadium paid for them a second time on December 17,
88. These representations to D.C. United were incorrect and constitute false statements
and/or omissions by CapX that CapX had a duty to disclose to D.C. United with respect to an issue
material to the bargain struck between the parties, i.e., payment the delivery and installation of
89. D.C. United reasonably relied on CapX’s statements that CapX had not received
90. Because of CapX’s representations, D.C. United was forced to make duplicate
United has been damaged in an amount to be determined at trial, but not less than $110,183.68 on
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92. Additionally, for the reasons stated above, Vassos is personally liable for CapX’s
negligent misrepresentation.
COUNT V
(Conversion – the Copier Leases)
93. D.C. United repeats and realleges the allegations set forth above as if fully set forth
herein.
94. CapX has unlawfully exercised ownership, dominion, and control over D.C.
United’s property, specifically the $58,188 paid in duplicate to CapX for the Copier Leases, in
95. As a direct and proximate cause of CapX’s conversion, D.C. United has been
damaged in an amount to be determined at trial, but not less than $58,188 on the Copier Leases.
96. Additionally, for the reasons stated above, Vassos is personally liable for CapX’s
conversion.
COUNT VI
(Negligent Misrepresentation – the Copier Lease)
97. D.C. United repeats and realleges the allegations set forth above as if fully set forth
herein.
98. The parties’ intent in entering into the Second Copier Lease was for the amount
CapX spent with D.C. United would roughly equal the amount D.C. United spent with CapX.
CapX represented to D.C. United that the amounts paid to Marlin under the Second Copier Lease
99. CapX also represented to D.C. United that the Second Copier lease superseded the
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100. These representations to D.C. United were incorrect and constitute false statements
and/or omissions by CapX that CapX had a duty to disclose to D.C. United with respect to an issue
material to the bargain struck between the parties, i.e., payment for the copier lease.
101. D.C. United reasonably relied on CapX’s statements that the Second Copier Lease
102. Because of CapX’s representations, D.C. United was forced to make payments on
both the First Copier Lease (to Noreast) and the Second Copier Lease (to Marlin), for the same
United has been damaged in an amount to be determined at trial, but not less than $58,188 on the
Copier Leases.
104. Additionally, for the reasons stated above, Vassos is personally liable for CapX’s
negligent misrepresentation.
105. D.C. United respectfully requests that the Court enter judgment in its favor,
b. Attorney’s fees;
c. Costs;
e. Such other and further relief as the Court deems just and equitable under
the circumstances.
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Plaintiffs hereby request a trial by jury of any issue so triable as of right pursuant to Rule
Respectfully submitted,
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