Opinion
01 Civ. 0616 (DAB)
January 27, 2002
Martin B. Adams, LAW OFFICES OF KOPFF, NARDELLI DOPF LLP, New York, NY, for Plaintiff.
Mara B. Levin, LAW OFFICES OF HERRICK, FEINSTEIN LLP, New York, NY, for Defendant Russian Tea Room Realty LLC and Alan Garmise.
MEMORANDUM ORDER OPINION
In his First Amended Complaint, Fabrice Canelle, ("Plaintiff"), alleges breach of contract, wrongful discharge, tortious interference with contract, and fraud claims against Russian Tea Room Realty LLC, ("RTR"), and Alan Garmise, ("Garmise"), (collectively, the "Defendants"). Defendants move pursuant to Rule 12(b)(6) and 9(b) of the Federal Rules of Civil Procedure to dismiss all causes of action as to Defendant Garmise and all but the First Cause of Action alleged in the Amended Complaint against Defendant RTR. For the reasons stated below, Defendants' motion is GRANTED. Plaintiff is granted leave to replead his fraud claim against the proper Defendants.
Plaintiff Canelle had offered, three days before the instant motion was served, to dismiss the Second Cause of Action. Defendants declined so to stipulate, since they had moved against most of the Amended Complaint.
On the face of the Amended Complaint, the Plaintiff has not explained why he has not named as a Defendant the entity that he signed the contract with (Warner LeRoy Real Estate, LLC, ("WLRE")), the relationship of WLRE to RTR, or the relationship of Warner LeRoy, who allegedly made fraudulent statements which induced the Plaintiff to sign the contract, to WLRE. Admittedly, the letter contract on its face is confusing since the letter head names two entities (RTR and LeRoy Adventures) but is signed by WLRE. Should the Plaintiff choose to amend the Complaint on the surviving causes of action, these deficiencies shall be addressed as well as those cited in the text of this Memorandum Order.
I. BACKGROUND
Defendant RTR hired Plaintiff to work as an Executive Chef at the Russian Tea Room. (Am. Compl. ¶¶ 9, 10, Ex. A.) Prior to his employment with RTR, Plaintiff was employed in San Francisco. (Am. Compl. ¶ 42.) During the time the Plaintiff was employed in San Francisco, Plaintiff discussed the possibility of moving to New York to work at the Russian Tea Room with the owner/operator of RTR, Warner LeRoy, ("LeRoy"). (Am. Compl. ¶¶ 40-43.) Plaintiff alleges that LeRoy, told Plaintiff about his plans to "reinvent Russian cooking." (Am. Compl. ¶ 40.) LeRoy indicated to Plaintiff his willingness to give Plaintiff "full control of the menu," and that LeRoy would put on the menu whatever Plaintiff wanted. (Am. Compl. ¶ 40.) Plaintiff alleges that LeRoy made these statements in his capacity as the owner! operator of RTR. (Am. Compl. ¶ 41.)
Plaintiff alleges that he relied on LeRoy's statements and that LeRoy's statements in fact induced Plaintiff to leave his place of employment in San Francisco and move to New York to sign an employment agreement with RTR. (Am. Compl. ¶¶ 49, 50.) Plaintiff contends that LeRoy intended to defraud Plaintiff through uttering these false and misleading statements in order to induce Plaintiff to move to New York to work for RTR. (Am. Compl. ¶¶ 45, 46, 48.) Furthermore, Plaintiff claims that, while LeRoy and RTR knew the alleged statements were false, Plaintiff had no knowledge of such falsity. (Am. Compl. ¶¶ 44-47.)
On February 2, 1999, Plaintiff signed an employment contract with RTR, (the "Agreement"). (Am. Compl. ¶ 9.) Pursuant to the Agreement, Plaintiff agreed to serve as the Executive Chef of the Russian Tea Room from March 1, 1999 until September 15, 2002. (Am. Compl. ¶ 10.) The Agreement also provided that Plaintiff would receive $125,000 per year from March 1, 1999 until the opening of the Russian Tea Room, and $150,000 per year thereafter. (Am. Compl. ¶ 11.) Under the terms of the Agreement Plaintiff's compensation was not limited to his yearly salary. The Agreement also included a profit sharing provision, (Am. Compl. ¶ 12), an incentives clause, (Am. Compl. ¶ 13) and health and 401(k) benefits, (Am. Compl. ¶ 14).
The amount of Plaintiff's bonus depended upon the strength of the restaurant's reviews in the New York Times.
Defendant Garmise signed the Agreement as Vice President of Warner LeRoy Real Estate LLC. (Am. Compl. Ex. A.) Plaintiff's signature also appears on the Agreement. (Id.) Plaintiff alleges that he completely performed his duties under the Agreement. (Am. Compl. ¶ 17.) However, despite his performance in accordance with the Agreement, Plaintiff alleges that on or about April 26, 2000, Garmise informed him that Defendants intended to terminate his employment. (Am. Compl. ¶ 19.) Plaintiff alleges that during this same period Garmise indicated to Plaintiff (1) that "[i]f [he] insist[ed] on staying on [Garmise and RTR would make his] life very hard"; (2) that "[Defendants were] going to watch [him] every second and make [his] life miserable if [he decided to] stay on"; and (3) that Plaintiff's "contract [with Defendants was] not that great." (the "Garmise Statements") (Am. Compl. ¶¶ 20-22.)
Garmise is the President of LeRoy Adventures, Inc., as well as an employee of RTR. (Am. Compl. ¶ 35.)
Plaintiff alleges that Defendants maliciously harassed Plaintiff and unlawfully and unjustifiably interfered with his performance under the Agreement. (Am. Compl. ¶ 23.) Plaintiff also alleges that on April 26, 2000, Defendants wrongfully discharged him and ordered him off the premises and that Defendants refused to comply with their obligations and duties under the Agreement. (Am. Compl. ¶ 29.)
Aside from allegations contained elsewhere in the Amended Complaint, the Plaintiff offers no further details of the harassment that he suffered at the hands of the Defendants.
Plaintiff asserts that Defendant RTR had knowledge of the statements made by Garmise and his purported actions. (Am. Compl. ¶ 24.) Plaintiff also contends that the Garmise Statements were made (1) to deceive and defraud him; (2) to encourage Defendant RTR to breach its contract with him; and (3) to encourage Defendant RTR to terminate him wrongfully. (Am. Compl. ¶ 33.) Plaintiff further alleges that Defendant Garmise was acting within the scope of his employment and association with RTR at the time the events in the Amended Complaint took place. (Am. Compl. ¶ 26.)
Finally, Plaintiff expresses his desire to continue as Executive Chef at the Russian Tea Room for the term of employment provided for in the Agreement. (Am. Compl. ¶ 18.)
II. DISCUSSION
In a motion to dismiss for failure to state a claim upon which relief can be granted pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure, it is generally accepted that a complaint should not be dismissed unless it is entirely clear that the plaintiff is unable to prove any set of facts that would support the claim and thereby grant him relief. Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 102 (1957). The complaint must be read "generously, accepting as true the factual allegations in the complaint and drawing all inferences in favor of the pleader." BRS Associates, L.P. v. Dansker, 246 B.R. 755, 764 (S.D.N.Y. 2000) (citing Bolt Elec., Inc. v. City of New York, 53 F.3d 465, 469 (2d Cir. 1995); Mills v. Polar Molecular Corp., 12 F.3d 1170, 1174 (2d Cir 1993)). A court should grant the motion to dismiss only "if, after viewing plaintiff's allegations in this most favorable light, `it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.'" Walker v. City of New York, 974 F.2d 293, 298 (2d Cir. 1992) (quoting Ricciuti v. New York City Transit Auth., 941 F.2d 119 (2d Cir. 1991)). In deciding a motion to dismiss brought pursuant to Rule 12(b)(6), the Court "is not to weigh the evidence that might be presented at a trial but merely to determine whether the complaint itself is legally sufficient." Goldman v. Belden, 754 F.2d 1059, 1067 (2d Cir. 1985). Finally, in deciding a motion under Rule 12(b)(6), the Court may consider the complaint as well as any documents incorporated into or appended to the complaint. See Tarshis v. Riese Org., 211 F.3d 30, 39 (2d Cir. 2000).
The Agreement is attached to the original Complaint filed in this action, annexed to the Amended Complaint as Exhibit A, and specifically referenced in ¶ 15 of the Amended Complaint.
A. Plaintiff's First Cause of Action
On its face, Plaintiff's First Cause of Action alleges that the Defendants breached the Agreement. Paragraph 23 of the Amended Complaint begins "Defendants . . . breached said Agreement," and then enumerates the ways in which the Agreement was "breached". Garmise argues that he may not be held personally liable for the breach of the Agreement since he signed the Agreement in his representative capacity as Vice President of Warner LeRoy Real Estate LLC. (Defs.' Mem. Law at 3; Am. Compl. ¶ 15.) Plaintiff, however, contends that the First Cause of Action, instead of alleging breach of contract, actually alleges intentional interference with a contractual relation.
This Court disagrees with Plaintiff's characterization of the First Cause of Action. It is clear to this Court that the First Cause of Action alleges a breach of contract claim. Plaintiff implicitly acknowledges as much through his decision not to oppose Defendants' Motion to dismiss the Second Cause of Action that alleges wrongful discharge. Additionally, the Affirmation submitted in Opposition to Defendants' Motion states "this action for damages [is] based upon breach of contract, tortious interference with contract, and fraud." (Adams Aff. at ¶ 4.) Plaintiff's Third Cause of Action might arguably allege a tortious interference with contract claim.
Defendant's Motion on that claim rests upon the fact that New York courts do not recognize a cause of action for wrongful discharge separate and apart from a claim for damages arising from a breach of contract.
As the First Cause of Action is a breach of contract claim, the Plaintiff's response to the Defendants' Motion to Dismiss the First Cause of Action is nonresponsive and seeks to re-characterize and transform the claim plainly alleged in the Amended Complaint. The Court GRANTS Defendant Garmise's Motion to Dismiss this claim. General principles of agency law dictate this result. See Seguros Banvenez, S.A. v. S/S Oliver Drescher, 761 F.2d 855, 860 (2d Cir. 1985) ("When an agent makes a contract for a disclosed principal, it becomes neither a party to the contract nor liable for the performance of the contract. Accordingly, it is not liable if the contract is breached." (citations omitted)); see also New York Ass'n for Retarded Children, Inc. v. Keator, 606 N.Y.S.2d 784, 785 (N.Y.App.Div. 199 3) ("It is well established that an agent of a disclosed principal does not, absent express agreement, become liable individually on a contract relating to the agency." (citations omitted)).
B. Plaintiff's Second Cause of Action
Defendants move to dismiss the Second Cause of Action as New York law does not recognize a cause of action for wrongful discharge separate and apart from a claim for damages arising from breach of an employment agreement. Plaintiff does not oppose Defendants' motion on this claim. Accordingly, the Second Cause of Action is dismissed.
See n. 1, supra.
C. Plaintiff's Third Cause of Action
Plaintiff's Third Cause of Action is addressed to Defendant Garmise only and alleges that Garmise tortiously interfered with the contract between Plaintiff and Defendant RTR.
Under New York law, the elements of a tortious interference claim are: (a) that a valid contract exists; (b) that a "third party" had knowledge of the contract; (c) that the third party intentionally and improperly procured the breach of the contract; and (d) that the breach resulted in damage to the plaintiff. Finley v. Giacobbe, 79 F.3d 1285, 1294 (2d Cir. 1996) (citing Israel v. Wood Dolson Co., 1 N.Y.2d 116, 120, 134 N.E.2d 97, 99-100 (1956); Kaminski v. United Parcel Serv., 501 N.Y.S.2d 871, 873 (N.Y.App.Div. 1986)).
There is no dispute that a valid contract existed. Plaintiff, however, must establish that Garmise is not a party to the contract. See Finley, 79 F.3d 1285, 1295 (citing Wood Dolson Co., 1 N.Y.2d at 120, 134 N.E.2d at 99-100; Winicki v. City of Olean, 611 N.Y.S.2d 379, 380 (N.Y. A.D. 1994) (only "a stranger to a contract" may be liable for tortious interference)); Artwear, Inc. v. Hughes, 615 N.Y.S.2d 689, 694 (N.Y.App.Div. 1994)). A defendant-employee is a "third party," where "the defendant-employee has exceeded the bounds of his or her authority."Finley, 79 F.3d at 1295 (citing Kosson v. Algaze, 610 N.Y.S.2d 227, 228-29 (N.Y.App.Div. 1994) (employer's agents may not be held liable for tortious interference "absent a showing that they acted outside the scope of their authority"), aff'd, 84 N.Y.2d 1019, 646 N.E.2d 1101 (1995)); see also Solow v. Stone, 994 F. Supp. 173, 181 (S.D.N Y 1998) (agent may not be held liable for tortious interference so long as he is working in scope of his authority). Moreover, a "`corporate officer who is charged with inducing the breach of a contract between the corporation and [the other contracting party] is immune from liability if it appears that he is acting in. good faith as an officer [and did not commit] independent torts or predatory acts directed at another.'" Murtha v. Yonkers Child Care Ass'n, Inc., 45 N.Y.2d 913, 915, 383 N.E.2d 865, 866 (1978) (quoting Buckley v. 112 Cent. Park South, 285 A.D. 331, 334 (N.Y.App.Div. 1954)); see also Cohen v. Davis, 926 F. Supp. 399, 404 (S.D.N.Y. 1996) (applying Murtha rule to supervisory employee); BIB Constr. Co. Inc. v. City of Poughkeepsie, 612 N.Y.2d 283, 285 (N.Y. A.D. 1994) (employer's agent may be liable for tortious interference if the "agent does not act in good faith and commits independent torts or predatory acts directed at another for personal pecuniary gain").
In the present case, Plaintiff has failed to meet the third party requirement necessary to plead properly a tortious interference claim. While the Amended Complaint does not state Garmise's position in Defendant RTR, Plaintiff's Third Cause of Action is insufficient whether Garmise is considered an employee or a corporate officer. As an initial matter, Garmise signed the agreement in his capacity as Vice President of Warner LeRoy Real Estate LLC, an entity that is not named as a Defendant in this action. However, to the extent that Plaintiff is also an employee of RTR, the Amended Complaint fails to allege that Garmise acted outside the scope of his authority at any time as an RTR employee. In fact, the Amended Complaint alleges just the opposite. (Am. Compl. ¶ 26 (stating that Garmise acted "within the scope of [his] employment with and association with defendant Russian Tea Room Realty LLC"); Am. Compl. ¶ 25 (stating that RTR "ratified, adopted, controlled, approved of, and acquiesced to [Garmise's] statements, acts, and actions").) In addition, the Amended Complaint contains no allegations that Garmise committed independent torts or predatory acts against the Plaintiff.
Apparently, Warner LeRoy Real Estate LLC is the Managing Member of Defendant RTR. (Garmise Aff. ¶ 1.)
As such, the Plaintiff has failed to plead sufficiently a tortious interference of contract claim against Garmise. Defendants' motion to dismiss Plaintiff's Third Cause of Action against Garmise is GRANTED.
D. Plaintiff's Fourth Cause of Action
Plaintiff alleges in his Fourth Cause of Action that LeRoy fraudulently induced Plaintiff to move to New York to work for RTR, and that Garmise defrauded Plaintiff by uttering the various April 26, 2000 statements that are attributed to him in the Amended Complaint. Defendants argue that Plaintiff fails to satisfy the particularity requirement contained in Rule 9(b) of the Federal Rules of Civil Procedure. Defendants also argue that Plaintiff has failed to demonstrate the elements necessary to plead a fraud claim separate and apart from a breach of contract claim.
Some ambiguity exists with respect to the Parties that Plaintiff seeks to charge with fraud. Although the caption for the Fourth Cause of Action suggests that the Plaintiff seeks to hold both Defendants accountable, the demand for judgment on the Fourth Cause of Action only seeks damages from RTR. Indeed, since the only statements alleged to have been made by Garmise were made after the Agreement was signed and Plaintiff began working, they cannot be fraud in the inducement of signing the Agreement.
To state a claim for fraud, a plaintiff must allege that: "(1) the defendant made a material false representation, (2) the defendant intended to defraud the plaintiff thereby [scienter], (3) the plaintiff reasonably relied upon the representation, and (4) the plaintiff suffered damage as a result of such reliance." Bridgestone/Firestone, Inc. v. Recovery Credit Servs., Inc., 98 F.3d 13, 19 (2d Cir. 1996) (quotingBanque Arabe et Internationale D'Investissement v. Maryland Nat'l Bank, 57 F.3d 146, 153 (2d Cir. 1995)); see also Marcus v. AT T Corp., 138 F.3d 46, 63 (2d Cir. 1998).
When fraud is alleged, a plaintiff must satisfy the heightened pleading requirements set forth in Rule 9(b) of the Federal Rules of Civil Procedure. The Rule has three major objectives: "(1) providing a defendant fair notice of plaintiff's claim, to enable preparation of (a] defense; (2) protecting a defendant from harm to his reputation or goodwill; and (3) reducing the number of strike suits." DiVittorio v. Equidyne Extractive Industries, Inc., 822 F.2d 1242, 1247 (2d Cir. 1987). In furtherance of these objectives Rule 9(b) requires that a party plead "the circumstances constituting fraud" with particularity. Fed.R.Civ.P. 9(b). Despite the 9(b) requirement that the circumstances constituting the fraud be pled with particularity, the Rule provides that "[m]alice, intent, knowledge, and other condition of mind of a person may be averred generally." Fed.R.Civ.P. 9(b). Scienter, however, must be sufficiently pled. See BRS Associates, 246 B.R. 755, 768. Although alleging scienter with great specificity is not required, as one cannot expect a plaintiff to plead a defendant's state of mind,id., a plaintiff must nevertheless allege facts "that give rise to a strong inference of fraudulent intent" Acito v. IMCERA Group, Inc., 47 F.3d 47, 52 (2d Cir. 1995). A "strong inference" is established either "`(a) by alleging facts to show that defendants had both motive and opportunity to commit fraud, or (b) by alleging facts that constitute strong circumstantial evidence of conscious misbehavior or recklessness.'" Id. (quoting Shields v. Citytrust Bancorp, Inc., 25 F.3d 1124, 1128 (2d Cir. 1994)).
1. The Particularity Requirement
A complaint charging fraud must "`(1) detail the statements . . . that the plaintiff contends are fraudulent, (2) identify the speaker, (3) state where and when the statements . . . were made, and (4) explain why the statements . . . are fraudulent.'" Olsen v. Pratt Whitney Aircraft, 136 F.3d 273, 275 (2d Cir. 1998) (quoting Harsco Corp. v. Segui, 91 F.3d 337, 347 (2d Cir. 1996); In addition, where there are multiple defendants, each defendant must be provided with specific information alleging his or her individual participation in the "fraudulent conduct." Granite Partners, L.P. v. Bear, Stearns Co. Inc., 17 F. Supp.2d 275, 286 (S.D.N.Y. 1998).
Plaintiff has failed to satisfy the particularity requirement with respect to the statements made by LeRoy. Although Plaintiff has detailed LeRoy's allegedly fraudulent statements, thereby satisfying the first two requirements listed in Olsen, Plaintiff has provided virtually no details as to where and when the statements were made and how they are fraudulent. One of the statements that Plaintiff cites in support of his fraud claim, that LeRoy intented to "reinvent Russian cooking," is not actionable as a fraudulent misrepresentation as this exaggerated expression of intention is not the type of statement upon which one may reasonable rely. See Baker v. Dorfman, 239 F.3d 415, 423 (2d Cir. 2000) (mere puffery does not form basis of a fraud claim); Cohen v. Koenig, 25 F.3d 1168, 1172 (2d Cir. 1994) (same); (Saleemi v. Pencom Sys. Inc., No. 99 Civ. 667, 2000 WL 640647, at *5 (S.D.N.Y. May 17, 2000) (statements must be more than "mere puffery" or statements of opinion). All that can be gleaned from the Amended Complaint is that LeRoy made the allegedly fradulent statements sometime before Plaintiff signed the Agreement on February 2, 1999. Plaintiff essentially alleges that LeRoy's statements were made before Plaintiff decided to move to New York. This level of temporal specificity is inadequate to satisfy Rule 9(b). Similarly, Plaintiff provides no details regarding where these allegedly fraudulent statements were made or why they are false.
With respect to Garmise, Plaintiff's Amended Complaint is completely silent as to how, if at all, Garmise participated in fraudulently inducing Plaintiff to move to New York to work for RTR. It details no statements made by Garmise prior to the Plaintiff's decision to relocate. Further, nowhere in the Amended Complaint does Plaintiff detail how the statements in fact attributed to Garmise are fraudulent, nor does Plaintiff indicate where these statements were made. of the three statements contained in the Amended Complaint and attributed to Garmise, two simply suggest a possible intention to breach the Agreement. The third statement that "[t]he contract you have with us is not that great," is simply an opinion as to the efficacy of the employment contract, and as such is not actionable as fraud. See O'Connor v. Reader's Digest Assoc., Inc., No. 92 Civ. 7414, 1993 WL 291372, at *3 (S.D.N.Y. Mar. 10, 1993) ("fraud claim cannot be based upon statement of . . . mere expression of opinion"); Sheth v. New York Life Insurance Co., 709 N.Y.S.2d 74, 75 (N.Y.App.Div. 2000) (purported misrepresentations that are "conclusory and/or constitute mere puffery, opinions of value or future expectations" may not form basis for fraudulent misrepresentation); American Food Vending Corp. v. Int'l Business Machines Corp., 667 N.Y.S.2d 545, 546 (N.Y.App.Div. 1997) (expression of opinion will not support an action for fraud); Kimmell v. Schaefer, 637 N.Y.S.2d 147, 149 (N.Y.App.Div. 1996) (stating that opinions are not actionable unless they are statements of material fact); Zanani v. Savad, 630 N.Y.S.2d 89, 90 (N.Y.App.Div. 1995) ("In general, a representation of opinion or a prediction of something which is hoped or expected to occur in the future will not sustain an action for fraud"). Further, nowhere in the Amended Complaint does Plaintiff state that he relied on any of Garmise's statements. Additionally, Plaintiff in his Opposition does not even contest the Defendants' Motion to Dismiss the fraud claim with respect to Garmise. Accordingly, the Defendants' Motion to Dismiss the Fourth Cause of Action against both Defendants is GRANTED.
Defendants also argue that even if pled with the required specificity, Plaintiff's fraud action would still be defective since it merely restates the breach of contract claim. See Bridgestone/Firestone, 98 F.3d 13, 19 (stating that intentionally false statements that indicate an intent not to perform under the contract are insufficient to support a claim for fraud). In order for a fraud claim to survive alongside a breach of contract claim the plaintiff must either "(i) demonstrate a legal duty separate from the duty to perform under the contract, or (ii) demonstrate a fraudulent misrepresentation collateral or extraneous to the contract, or (iii) seek special damages that are caused by the misrepresentation and unrecoverable as contract damages."Bridgestone/Firestone, 98 F.3d 13, 20 (internal citations omitted). Plaintiff argues that he satisfies each of the Bridgestone/Firestone exceptions. As Plaintiff's claims are currently pled in the Amended Complaint this Court disagrees. Plaintiff has alleged no separate duty, and LeRoy's statements are clearly not extraneous to the contract. Further, the demand for damages on the Fourth Cause of Action is the same as that contained in Plaintiff's First Cause of Action. It is clear from the Amended Complaint that the damages sought by the Plaintiff in the Fourth Cause of Action, $500,000.00, far exceed any out of pocket pecuniary losses recoverable in fraud. See Bibeault v. Advanced Health Corp., No. 97 Civ. 6026, 1999 WL 301691, at *9 (S.D.N.Y. May 12, 1999) (dismissing fraud claim where "[t]he Complaint's framing of damages reveal[ed] that plaintiff [sought] only the benefits due under the oral contract, not out-of-pocket special damages").
E. Punitive Damages
Defendants have moved to dismiss Plaintiff's claim for punitive damages. Under New York law the purpose of awarding punitive damages is not to make the victim whole but to punish the defendant and to deter egregious conduct. E.g., Rocanova v. Equitable Life Assurance Society of the U.S., 83 N.Y.2d 603, 613 634 N.E.2d 940, 943 (1994) (vindicate public rights, not private wrongs) (citation omitted). Generally, punitive damages are not available for a breach of contract.
However, where the breach of contract also involves a fraud evincing a "high degree of moral turpitude" and demonstrating "such wanton dishonesty as to imply a criminal indifference to civil obligations," punitive damages are recoverable if the conduct was "aimed at the public generally" [citing Walker v. Sheldon, 10 N.Y.2d 401, 179 N.E.2d 497 (1961)]. Punitive damages are available where the conduct constituting, accompanying, or associated with the breach of contract is first actionable as an independent tort for which compensatory damages are ordinarily available, and is sufficiently egregious under the Walker standard to warrant the additional imposition of exemplary damages. Thus, a private party seeking to recover punitive damages must not only demonstrate egregious tortious conduct by which he or she was aggrieved, but also that such conduct was part of a pattern of similar conduct directed at the public generally.Rocanova, 83 N.Y.2d at 613, 634 N.E.2d at 943-44 (emphasis added). In this case the only claim that remains is Plaintiff's First Cause of Action against RTR, which the Court construes as alleging a breach of contract. Since the tortious interference with contract claim as well as the fraud claims have been dismissed, the Amended Complaint contains no conduct "actionable as an independent tort." Additionally, there is no allegation that the conduct was aimed at the public generally. See Int'l Motor Sports Group, Inc. v. Gordon, No. 98 Civ. 5611, 1999 WL 619633, at *10 (S.D.N.Y. Aug. 16, 1999) ("[W]here . . . a pleading alleges no facts that could satisfy the requirement, striking a request for punitive damages is appropriate.") The fact that the New York Post reported some of the events alleged in the Amended Complaint is insufficient to satisfy the "public wrong" requirement. (Adams Aff. Ex. F.) Accordingly, Plaintiff's demand for punitive damages is DISMISSED.
F. Leave to Replead
Rule 15(a) of the Federal Rules of Civil Procedure provides that permission to amend a pleading "shall be freely given when justice so requires." Fed.R.Civ.P. 15(a). "It is the usual practice upon granting a motion to dismiss to allow leave to replead." Cortec Indus., Inc. v. Sum Holding L.P., 949 F.2d 42, 48 (2d Cir. 1991). Absent a showing of undue delay, bad faith, or dilatory motive on the part of the movant, undue prejudice to the opposing party, or the futility of the amendment, a plaintiff should be granted leave to replead. See Protter v. Nathan's Famous Sys., Inc., 904 F. Supp. 101, 111 (E.D.N Y 1995) (quoting Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 230 (1962)).
The Court finds that based upon the analysis contained herein, repleading the breach of contract, tortious interference and fraud claims against Garmise would be futile. However, the Court cannot determine at this time whether the Plaintiff would be unable, under any circumstances, to allege sufficiently his fraud claim against the appropriate Defendant. Accordingly, the Court grants Plaintiff permission to replead the fraud claim. See Caputo v. Pfizer, Inc., 267 F.3d 181, 191 (2d Cir. 2001) (stating that where plaintiffs specifically request leave to amend in the event that the court is inclined to dismiss on Rule 9(b) grounds, the failure to grant leave to amend is an abuse of discretion unless the plaintiff has acted in bad faith or the amendment would be futile); De Jesus v. Sears, Roebuck Co., Inc., 87 F.3d 65, 71-2 (2d Cir. 1996) (noting that it is an abuse of discretion to dismiss allegations of fraud without granting a party leave to file an initial amendment to comply with Rule 9(b)); Luce v. Edelstein, 802 F.2d 49, 56 (2d Cir. 1986) (noting that in cases where leave to replead fraud has not been granted, plaintiffs have usually had one opportunity to plead with the requisite specificity, or the defective allegations were made after full discovery in a related case).
Accordingly, Plaintiff is hereby granted leave to file a Second Amended Complaint, consistent with the above limitations, within thirty (30) days of the date of this Order. Failure to file a Second Amended Complaint within this time period shall result in a waiver of the right to replead. With regard to any amendment, Plaintiff is cautioned against making perfunctory, substantive or cosmetic changes. Id. Defendants shall move or answer within 20 days after the Second Amended Complaint, if any, has been served.
The parties in this case should heed Judge Leisure's thoughtful comments in Spier v. Erber, No. 89 Civ. 1657, 1990 WL 71502, at *10 n. 8 (S.D.N.Y. May 24, 1990):
[I]t has become an all too common practice for litigants granted leave to replead to make only minor changes in the original complaint based on an overly restrictive reading of the dismissing court's order, prompting a second motion to dismiss. An amended complaint which fails to replead with sufficient particularity after a finding of lack of specificity may be well be regarded by the Court as a frivolous filing in violation of Fed.R.Civ.P. 11. Conversely, a renewed Rule 9(b) motion after an adequate and thorough repleading can also be viewed as frivolous.
In the event that Plaintiff files a Second Amended Complaint that is insufficiently pled or not in accord with this Court's decision, the Court may, on motion, take appropriate action. Fed.R.Civ. p. 11.
III. CONCLUSION
Defendants' motion to dismiss the Amended Complaint is granted pursuant to Rule 12(b)(6) and Rule 9(b) of the Federal Rules of Civil Procedure. Plaintiff's First Cause of Action against RTR survives. Leave to replead the Fourth Cause of Action against the proper Defendants is GRANTED. The Plaintiff's demand for punitive damages is dismissed. Plaintiff's Second Amended Complaint, if any, shall be filed within 30 days of this Order. Failure to file a Second Amended Complaint will constitute a waiver of such privilege. Defendants shall, upon receipt of the Second Amended Complaint, move or answer within 20 days of the date of service.
SO ORDERED.