Inova Health Care Services v. Omni Shoreham Corporation

── Inova Health Care Services v. Omni Shoreham Corporation ── Court: Court of Appeals for the D.C. Circuit Date: April 17, 2026 Category: General United States Court of Appeals FOR THE DISTRICT OF COLUMBIA CIRCUIT Argued February 26, 2026 Decided April 17, 2026 No. 25-7010 INOVA HEALTH CARE SERVICES, FOR INOVA FAIRFAX HOSPITAL AND ITS DEPARTMENT, LIFE WITH CANCER, ET AL., APPELLEES v. OMNI SHOREHAM CORPORATION, APPELLANT Appeal from the United States District Court for the District of Columbia (No. 1:20-cv-00784) Matthew H. Lembke argued the cause for appellant. With him on the briefs were C. Stephen Setliff, Eli Jason S. Mackey, and W. Chadwick Lamar, Jr. Christopher W. Mahoney argued the cause for appellees. With him on the brief was Gregory S. Seador. Before: MILLETT and CHILDS, Circuit Judges, and RANDOLPH, Senior Circuit Judge.  2 Opinion for the court filed by Senior Circuit Judge RANDOLPH. RANDOLPH, Senior Circuit Judge: This is a breach of contract action. Jurisdiction rests on diversity of citizenship. The parties agree that substantive District of Columbia law controls. The parties’ disagreement is mainly about the district court’s application of D.C. law in rendering judgment in favor of the plaintiffs, Inova Health Care Services, and the Smith Center for Healing and the Arts, and against the defendant, the Omni Shoreham Corporation. I The events leading to the breach are as follows. The Joan Hisaoka “Make a Difference” Gala was an annual black-tie charity event Robert Hisaoka created in 2008 in honor of his sister to raise funds for organizations devoted to cancer victims. In 2013, and each year thereafter through 2018, the Gala took place at the Omni Shoreham Hotel in Washington, D.C. Inova contracted with Omni for the yearly event. While plaintiff Smith Center was not a party to any of the contracts, it had benefitted financially from the Galas and paid the cost of the event or the $10,000 deposit to Omni each year. In December 2018, Omni and Inova executed an Agreement for the 2019 Gala, to be held at the Hotel on September 21, 2019. The Agreement provided that cocktails and dessert would be in the Hotel’s Ambassador Ballroom and dinner would be in the Regency Ballroom. Smith Center paid the $10,000 deposit.  3 Omni’s standard contract for events like these contained a clause allowing the Hotel to redesignate where in the Hotel the event would be held. Robert Hisaoka, acting as an agent for Inova in negotiating the 2013 Omni-Inova contract, insisted on deleting this standard clause. Omni agreed. The 2019 Agreement, like each Gala contract between Omni and Inova after 2013, did not contain such a clause. Nonetheless, on July 8, 2019—a few months before the upcoming September Gala—Omni informed Inova that the Hotel was moving the Gala out of the Ambassador and Regency Ballrooms and into the Hotel’s Blue Room and Roberts Restaurant, as well as a tented outdoor area. Omni made this decision to accommodate the Embassy of Lebanon’s desire to conduct a conflicting event at the Hotel. The Embassy offered to pay Omni three times more than Inova. Inova objected, and demanded that Omni honor the contract. Omni declined, but reiterated that it remained willing to host the Gala in the alternative spaces it had proposed. Counsel for Inova informed Omni that the alternative spaces were not suitable for enumerated reasons, and Inova therefore would not proceed with the event at the Hotel and intended to file suit. Inova held its 2019 Gala at another venue on the same date originally planned. After initially denying both parties’ motions for summary judgment, the district court granted Inova’s motion for reconsideration and granted summary judgment on liability to Inova and to Smith Center as a third-party beneficiary. The court ruled th