Opinion
602694/2005.
Decided August 1, 2008.
Thompson Wigdor Gilly LLP, New York, New York, (By: Douglas H. Wigdor) for Plaintiff.
Paul, Weiss, Rifkind, Wharton Garrison LLP, New York, New York, (By: Jeh Charles Johnson, Philip G. Barber, Elizabeth M. Eaton) for Defendants:
In this action alleging that defendants failed to honor their promises to make plaintiff a partner in defendant law firm Orrick, Herrington Sutcliffe LLP (Orrick), three motions (sequence numbers 005, 006 and 007) are consolidated for disposition in accordance with the following decision and order.
In motion sequence number 005, defendants move, pursuant to CPLR 3212, for summary judgment dismissing the complaint. Plaintiff cross-moves, also pursuant to CPLR 3212, for summary judgment on the complaint's fourth and fifth causes of action, which allege claims for breach of contract and promissory estoppel.
In motion sequence number 006, plaintiff moves for an order "striking portions of Defendants' Motion for Summary Judgment and Defendants' Memorandum of Law in Support of their Motion for Summary Judgment" (Notice of Motion).
In motion sequence number 007, plaintiff moves, pursuant to CPLR 3212, for summary judgment on the complaint's fourth and fifth causes of action.
According to plaintiff's counsel, motion sequence number 007 and the cross motion on motion sequence number 005 are the same motion, and motion sequence number 007 was filed only because the court's electronic filing system did not accept the cross motion as a cross motion.
Plaintiff Patrick Hoeffner began working in Orrick's New York office, as an associate attorney in the firm's intellectual property (IP) group, in 1999. The individual defendants (the Partners) are four of Orrick's partners: William Anthony, who is the practice group leader for Orrick's entire IP group and works in the firm's Silicon Valley office; Robert Isackson and Robert Cote, who work in the New York IP group; and John MacKerron, who is the managing director for all of Orrick's offices, the office leader for the New York office and a member of the firm's executive committee.
In early March 2002, two of the partners in Orrick's New York IP group left Orrick and moved to Chadbourne Park LLP (Chadbourne). Chadbourne also offered employment, with a salary increase, to Hoeffner. Hoeffner and one of the partners who went to Chadbourne had been handling a litigation matter for one of Orrick's clients (the Conductus Litigation), and the Partners allegedly wished to keep Hoeffner at Orrick because they believed that, if Hoeffner stayed with Orrick, the Conductus Litigation would also remain with the firm.
Certain of the Partners allegedly discussed with Hoeffner what it would take to keep him at Orrick, and he indicated that he wanted to become a partner of the firm. Anthony and Cote allegedly told Hoeffner that Orrick had a policy against contracting with an associate to make the associate a partner, but that the end of making him a partner could be achieved by an alternative means, i.e., a purported "end-around" the firm policy. Anthony and Cote allegedly advised Hoeffner that the role of Orrick's executive committee in elevating an associate to partnership was merely that of a "rubber stamp," because the executive committee defers to practice group leaders with regard to such matters, and every associate who a practice group leader "puts up" to the executive committee for partnership is made a partner. For that reason, Anthony allegedly told Hoeffner, a contract obligating Anthony to put Hoeffner up for partnership to the executive committee would achieve the same effect as a contract requiring Orrick to make Hoeffner a partner.
On March 26, 2002, Hoeffner sent an e-mail to Isackson, Anthony and MacKerron which stated: "[t]he terms have changed a few times over the last few days. This confirms your offer as I understand it" (Barber Affirm., Ex. I). The e-mail set forth three terms which related to salary, and a fourth which provided:
4. Partnership consideration in or around September 2003 (to be voted on in January 2004). Bill [Anthony] will present my case for partnership to me and I will solely make the determination whether I will be put up for partnership (i.e., voted on in January 2004). Should I choose to be voted on, at least Bill [Anthony], Bob Cote, and Rob [Isackson] will give their full support and encouragement in helping me to become a partner.
Is this correct?
(Id.) Anthony replied with an e-mail which stated, "Your understanding is correct. Thank you for making the right decision!" ( id.). Hoeffner then e-mailed to Anthony in response: "I accept your offer" ( id.). Allegedly in reliance upon the foregoing e-mail exchange, Hoeffner rejected Chadbourne's offer of employment and an employment offer from another firm.
Hoeffner alleges that the foregoing e-mail exchange comprised a contract (the Agreement), and defendants do not appear to dispute that, in general terms and subject to certain limitations, the Agreement expressed or commemorated the parties' understanding: (1) that Hoeffner had a right or option to elect to be put up by Anthony to Orrick's executive committee for partnership in late 2003, with the object of being considered for election to partnership in January 2004; and (2) that, in the event that Hoeffner did so elect, certain of the Partners were obligated to provide some degree of support for Hoeffner's partnership bid ( see e.g. Def. Mem. of Law in Supp., at 2; Answer, ¶ 2; Def. Resp. to Pl. State. of Add. Mat. Iss. of Fact, ¶ 51; Eaton Affirm., Ex. I; Isackson EBT, at 326-327). Hoeffner alleges that defendants breached the Agreement when Anthony did not put Hoeffner up for partnership in the end of 2003 and/or January 2004, and when Anthony, Cote and Isackson did not give their full support and encouragement in helping Hoeffner to become a partner.
Hoeffner alleges that the Partners also made certain fraudulent misrepresentations to him, on or about March 15, 2002, in order to induce him to remain at Orrick. Hoeffner had allegedly heard a rumor that Orrick was bringing outside attorneys into its IP group as partners, and was concerned that the addition of such lateral partners would reduce his own chances of becoming partner. He allegedly asked Cote and Anthony in March 2002 whether Orrick was planning to bring any lateral partners into its IP group, and each of them allegedly responded that Orrick was not. However, on or about August 29, 2002, Orrick brought three attorneys from another firm into its New York IP group as partners. Hoeffner alleges that, by March 2002, Isackson had already conducted and/or scheduled interviews with each of the three attorneys who were later brought in as lateral partners. By increasing the total number of partners in the New York IP group from four to seven, while the number of associates in the group remained at nine, the addition of the three lateral partners allegedly made it financially unfeasible for Orrick to elevate any of the associates in the group to partnership in January 2004.
In December 2003 and January 2004, Hoeffner was working on a litigation matter which was scheduled to go to trial in March 2004 (the Applera Litigation). According to Hoeffner, defendants engaged in a deceptive scheme in order to keep him from leaving Orrick until the Applera Litigation ended. In the beginning of 2004, Anthony, Isackson and Cote allegedly continued to tell Hoeffner that he had a great future at Orrick, and that he should stay at the firm, because he would be made a partner in January 2005. However, Hoeffner asserts that, even at the time when the Partners made those statements, they had no intention of ever promoting him to partnership.
On or about February 2, 2004, Anthony allegedly met with Hoeffner and the other senior associates in Orrick's New York IP group, in order to allay their concerns about their partnership prospects, and to keep them from leaving Orrick. At that meeting, Anthony allegedly made numerous misrepresentations including: that, although Hoeffner had not been put up for partnership, he had been "given an honorable mention" to the executive committee as a "rising star to be considered next year [2005]"; that Anthony had personally spoken to the chairman and chief executive officer of Orrick, Ralph Baxter, about each of the associates at the meeting; that the bar for partnership had been raised too high, and too few associates had been made partners in January 2004; that every senior associate at the meeting, including Hoeffner, could make partner in 2005; that, despite the large number of associates who would be eligible for partnership in January 2005, there would be no "bunching" problem; and that Ralph Baxter had assured Anthony that he would "never lose an attorney because of numbers" (Complaint, ¶¶ 104-106; 136).
On or about February 3, 2004, Isackson allegedly made various misrepresentations to Hoeffner, in order to keep him from leaving Orrick during the Applera Litigation, including: that, because Hoeffner had been given an honorable mention before the executive committee, his position for partnership in 2005 was stronger; that Isackson had spoken on Hoeffner's behalf to Dan Thomasch, the managing director of Orrick's national litigation practice and a member of the executive committee, although only after the executive committee had already made its decisions concerning candidates for partnership in January 2004; and that, although Isackson had made mistakes concerning the promotion of senior associates to partnership — because it was the first year that he had responsibility for such matters — he had learned a lot and would do better the next year in getting associates promoted to partnership. Hoeffner allegedly believed the Partners' false representations to the effect that he had a great future at Orrick, and stayed at the firm.
After the Applera Litigation ended, in or about April 2004, Hoeffner was allegedly "cut off . . . and went for long stretches without any work whatsoever" ( id., ¶ 128). On or about November 20, 2004, Isackson allegedly told Hoeffner to look for a new job, that things at Orrick had changed, that the bar for partnership had become much higher, that Hoeffner was not deemed to be partnership material, and that Hoeffner had until January 1, 2005 to find a new job. Orrick continued to pay Hoeffner a salary until May 20, 2005.
By letter dated May 23, 2005, Hoeffner was offered a position of counsel in the New York IP department of another law firm at an annual base salary of $200,000 ( see Barber Affirm., Ex. Y). However, that firm apparently learned that Hoeffner had commenced this action, and subsequently withdrew its offer of employment ( see id., Exs. Z, AA). Since November 2005, Hoeffner has been employed as general counsel, director of intellectual property, by a design and manufacturing company at an annual salary of $170,000 ( see Hoeffner EBT, at 94-96).
The complaint asserts nine causes of action which allege claims for: (1) fraudulent inducement; (2) fraud; (3) fraudulent concealment; (4) breach of contract; (5) promissory estoppel; (6) civil conspiracy; (7) unjust enrichment; (8) breach of fiduciary duty; and (9) intentional infliction of emotional distress.
Defendants' Motion for Summary Judgment
Defendants' motion for summary judgment is granted, in part, to the extent that the complaint's second, fifth, seventh, eighth and ninth causes of action, and portions of the first, third and fourth causes of action, are dismissed.
Hoeffner's fourth cause of action alleges that the Partners breached the Agreement when they failed to give their full support and encouragement in helping Hoeffner to become a partner, and when Anthony failed to put Hoeffner up to Orrick's executive committee for partnership, in the end of 2003 and/or beginning of 2004. The claim seeks to recover damages which Hoeffner allegedly suffered from: the loss of the salary, fringe benefits and other income that he would have received if Orrick had made him a partner in January 2004; the "costs of seeking out partnership opportunities at a new firm"; the loss of "future earnings because of the delay in becoming partner"; and/or the loss of the future income Hoeffner would have earned if he had become a partner at a firm with lower partnership compensation levels than Orrick (Complaint, ¶ 173).
However, as defendants correctly assert, Hoeffner's fourth cause of action fails to allege any damages that are recoverable on a breach of contract claim. "[B]reach of contract damages are intended to place a party in the same position as he or she would have been in if the contract had not been breached" ( Wenger v Alidad, 265 AD2d 322, 323 [2d Dept 1999])." The damages for which a party may recover for a breach of contract are such as ordinarily and naturally flow from the non-performance. They must be proximate and certain, or capable of certain ascertainment, and not remote, speculative or contingent'" ( Fruition, Inc. v Rhoda Lee, Inc. , 1 AD3d 124 , 125 [1st Dept 2003], quoting Booth v Spuyten Duyvil Rolling Mill Co., 60 NY 487, 492).
The damages which Hoeffner seeks in his breach of contract claim are speculative and contingent rather than proximate and certain. All of the purported damages are predicated upon losses that Hoeffner allegedly suffered because Orrick did not make him a partner in January 2004. However, even assuming that the Partners had performed their purported obligations under the Agreement — i.e., that the Partners had given their full support and encouragement in helping Hoeffner to become a partner and that Anthony had put Hoeffner up to Orrick's executive committee for partnership in the end of 2003 and/or beginning of 2004 — it is not reasonably certain that Hoeffner would, as a consequence, have been made a partner in January 2004. Rather, his becoming a partner would have been contingent upon the occurrence of an additional event over which the Partners did not exercise control, namely, the executive committee's approval and recommendation of Hoeffner to Orrick's full partnership for election to partnership in January 2004.
Hoeffner asserts that if he had been "put up for partner with the full backing of the [Partners], it is clear that he would have been elected partner as a matter of course," and that "being put up for partner with the full support and encouragement' of the [Partners] was . . . tantamount to a guarantee that Plaintiff would be promoted to partnership status" (Pl. Mem. of Law in Opp., at 13-14). However, those conclusory assertions are contradicted by the evidence contained in the record. In its responses to Hoeffner's first set of interrogatories, Orrick has set forth information indicating that, during the years 2001 through 2005, there were: 55 candidates for partnership who were elected to partnership in the first or second year that they were considered for partnership by Orrick's executive committee; and 53 candidates for partnership who were not elected to partnership in a year when they were considered for partnership by the executive committee ( see Barber Affirm. Ex. CC, Resp. to Pl. Interrog. Nos. 54, 56, 57).
Of the 53 candidates who were not elected to partnership during the years 2001 through 2005, 15 were not elected to partnership in January 2004, the year when Hoeffner claims that his being put up for partnership to the executive committee would have assured his election to partnership ( see Barber Affirm., Ex. CC, Resp. to Pl. Interrog. No. 54).
Defendants assert that, during the years 2000 through 2005, "only 67 of the 132 Orrick associates who were put up for partner were actually elected partner" (Def. Mem. of Law in Supp., at 19; see also Def. Statement of Undisp. Fact, ¶ 9; Barber Affirm., Ex. BB, at 2). While that statement does not appear to be inconsistent with the information contained in Orrick's responses to Hoeffner's first set of interrogatories, it is not clear to me that the statement is specifically corroborated by any factual information contained in the record.
Hoeffner's memorandum of law attempts to minimize the possibility that an associate who was put up for partnership to the executive committee would not have been elected to partnership, inter alia, by referring to one unidentified associate as "the only New York IP associate who did not get elected partner after being put up by the IP Group" (Pl. Mem. of Law in Opp., at 14). However, it appears that that associate was also the only associate in Orrick's New York IP group who was put up for partnership in the end of 2003 and beginning of 2004 ( see Complaint, ¶ 103-104; Barber Affirm. Ex. CC, Resp. to Pl. Interrog. No. 54), the same period when Hoeffner claims that, if he had been put up for partnership, he would have been elected to partnership "as a matter of course." Hoeffner attempts to distinguish that associate's circumstances from his own by noting that — whereas the other associate "had his candidacy attacked by Defendant MacKerron in front of the Executive Committee" (Pl. Mem. of Law in Opp., at 14) — Hoeffner had the Partners' commitment, set forth in the Agreement, that they would give their full support and encouragement in helping him to become a partner. Although the Agreement provides that Anthony, Cote and Isackson shall give their support to Hoeffner's candidacy for partnership, under certain circumstances, it does not place any such obligation upon other Orrick partners, including MacKerron.
The proposition that the executive committee would automatically have approved and recommended Hoeffner for partnership if Anthony had put him up for partnership is also contradicted by the allegations contained in the complaint. The complaint characterizes as false the Partners' purported representations that "[t]he Executive Committee is a rubber stamp' on partnership issues when a group leader puts up an associate," and that "[t]he Executive Committee gives deference to practice group leaders on partnership issues" (Complaint, ¶ 136 [N], [O]). The complaint also alleges that when Orrick brought the three lateral partners into its New York IP group in August 2002 — such that "the number of partners in the NY IP Group swelled from four to seven and the number of associates remained at nine" — "making one or two associates partner in January 2004 was no longer financially feasible" ( id., ¶ 121). Thus, the complaint acknowledges that the executive committee's recommendation of an associate for partnership did not follow automatically from the mere fact that a practice group leader put the associate up to the executive committee for partnership, but depended upon various factors, including financial considerations.
Hoeffner's memorandum of law argues, alternatively, that, in addition to the obligations which are explicitly set forth in the Agreement — i.e., Anthony's, Cote's and Isackson's obligation to give their full support and encouragement in helping Hoeffner to become a partner, and Anthony's obligation to put Hoeffner up to Orrick's executive committee for partnership in the end of 2003 — the Partners had a contractual obligation to promote Hoeffner to partnership in January 2004. Hoeffner appears to assert, somewhat inconsistently, that such a contractual obligation was created both by the Agreement ( see Pl. Mem. of Law in Opp., at 11-12, 15) and also by a separate oral agreement that was collateral to the Agreement ( see id. at 14-15).
The fourth cause of action for breach of contract, as pleaded in the complaint, does not itself allege that the Partners had a contractual obligation to promote Hoeffner to partnership, or appear to be predicated upon the Partners' breach of such an obligation. Hoeffner has, in any event, failed to articulate any basis for the existence of a contractual obligation on the Partners' part to promote him to partnership in January 2004. First, it is clear that the parties did not intend to create such a contractual obligation because, according to the complaint's allegations, both Anthony and Cote told Hoeffner that Orrick had a policy against contracting with an associate to make the associate a partner ( see Complaint, ¶¶ 59-60), and the terms of the Agreement were purportedly structured as they were precisely in order to avoid violation of that policy.
Second, it would presumably have been clear to Hoeffner that Anthony, Cote and Isackson could not contract to perform an obligation that they manifestly did not have the power to perform — i.e., because they were not members of Orrick's executive committee, and the power to approve and recommend a candidate to the full partnership for election to partnership was a power exclusively within the province of the executive committee — let alone bind the executive committee to perform a contract which was allegedly contrary to Orrick's policies. Assuming, arguendo, that a Partner made a statement to the effect that the executive committee would automatically approve and recommend for partnership a candidate who was put up by the head of a practice group, such a statement would, in any event, be more in the nature of a representation of fact than a promise by the Partner to himself perform any particular contractual obligation.
Insofar as Hoeffner argues that it was the Agreement which created a contractual obligation on the Partners' part to promote him to partnership, his argument is precluded, additionally, by the parol evidence rule. Hoeffner concedes: that "the language demonstrating that being put up for partner was a rubber stamp for an associate's election to partnership is not explicitly contained in the [Agreement]" (Pl. Mem. of Law in Opp., at 14); that the language contained in the Agreement, which he himself drafted, is "clear" and "unambiguous" (Pl. Mem. of Law in Supp., at 3-4); and that the Agreement "included all the material terms of the agreement reached between Plaintiff and the [Partners]" ( id. at 4; see also Pl. Resp. to Def. State. of Undisp. Facts, ¶ 47).
Where a written contract is clear and unambiguous, "[e]vidence outside the four corners of the document as to what was really intended but unstated or misstated is generally inadmissible to add to or vary the writing" ( W.W.W. Assoc. v Giancontieri, 77 NY2d 157, 162; see also Shah v Eastern Silk Indus., 112 AD2d 870, 871 [1st Dept 1985] [stating that "(t)he parol evidence rule applies when the written understanding is clear and unambiguous, and the rule is intended to prevent proof of an oral agreement to add to or vary the writing" (citation and internal quotation marks omitted)], affd 67 NY2d 632). "[C]ourts may not by construction add or excise terms, nor distort the meaning of those used and thereby make a new contract for the parties under the guise of interpreting the writing" ( Bailey v Fish Neave , 8 NY3d 523 , 528 [citation and internal quotation marks omitted]). Thus, Hoeffner cannot offer parol or extrinsic evidence to establish that the Agreement created a contractual obligation on the part of the Partners to promote Hoeffner to partnership in January 2004, an obligation which the parties themselves did not set forth in the Agreement.
Hoeffner also asserts that the parties had a collateral oral agreement which obligated the Partners to promote him to partnership in January 2004 — or pursuant to which the Partners guaranteed that Hoeffner would be approved and recommended for partnership by the executive committee — and that the parol evidence rule does not bar evidence concerning such a collateral agreement. Hoeffner's memorandum of law quotes from a case which provides that, in order to qualify as a collateral oral agreement with respect to which parol evidence is admissible, an agreement must be:
one which is separate, independent and complete . . . although relating to the same object [as the written contract]. . . .". . . [A]t least three conditions must exist, (1) the agreement must in form be a collateral one; (2) it must not contradict express or implied provisions of the written contract; [and] (3) it must be one that parties would not ordinarily be expected to embody in the writing . . . [The oral agreement] must not be so clearly connected with the principal transaction as to be part and parcel of it."
(Adler Shaykin v Wachner, 721 F Supp 472, 478 [SD NY 1988], quoting Mitchill v Lath, 247 NY 377, 380-381 [additional citation and internal quotation marks omitted].) However, an oral agreement pursuant to which one or more of the Partners promised to promote Hoeffner to partnership in January 2004, or to guarantee his promotion to partnership, would not be separate and independent from the Agreement, or complete, but would be so clearly connected with the obligations set forth in the Agreement as to be part and parcel of it. Thus, Hoeffner has failed to establish that, or to raise an issue of fact with respect to his contention that, the parol evidence rule would not bar evidence concerning such an oral agreement.
Although Hoeffner's breach of contract claim alleges only damages which are speculative, because they would have been contingent upon his being elected to partnership, defendants are incorrect in asserting that dismissal of the claim is warranted on that ground. Where a plaintiff establishes "the making of a contract and a breach thereof, he or she is entitled to at least nominal damages, even though his or her complaint fails to allege damages or states an erroneous measure of damages" (36 NY Jur 2d, Damages § 6; see also Kronos, Inc. v AVX Corp., 81 NY2d 90, 95 [stating that "(n)ominal damages are always available in breach of contract actions"]; Contemporary Mission, Inc. v Famous Music Corp., 557 F2d 918, 926 [2d Cir 1977] [stating that, "(w)hen the existence of damage is uncertain or speculative, the plaintiff is limited to the recovery of nominal damages"]). Accordingly, defendants have failed to establish their entitlement to dismissal of the fourth cause of action, although that claim may proceed only upon a theory of nominal damages.
The first, second and third causes of action allege claims for fraud. In order to recover damages on a fraud claim, a plaintiff must prove "a misrepresentation or a material omission of fact which was false and known to be false by defendant, made for the purpose of inducing the other party to rely upon it, justifiable reliance of the other party on the misrepresentation or material omission, and injury" ( Lama Holding Co. v Smith Barney, 88 NY2d 413, 421; see also Peach Parking Corp. v 346 W. 40th St., LLC , 42 AD3d 82 , 86 [1st Dept 2007]).
The first cause of action asserts a claim for fraud in the inducement predicated upon 35 purported misrepresentations — designated in paragraph 136 of the complaint by the letters A through II — that the Partners allegedly made to Hoeffner in order to induce him to remain with Orrick. The first cause of action is dismissed insofar as it is based upon the purported misrepresentations other than those designated by the letters E (that "[t]he NY IP Group has no plans to bring in any lateral partners"), F (that "[t]he only way to properly grow a practice group is to promote the senior associates to partner and hire more junior associates") and G (that "the firm management plans to significantly grow the New York IP Group by promoting many senior associates to partner and hiring numerous junior associates").
Hoeffner asserts that, on or about March 15, 2002, when he asked Cote and Anthony whether Orrick had plans to bring any outside attorneys into its New York IP group as lateral partners, Cote and Anthony each replied to the effect that Orrick did not have such plans, and that the only proper way to grow the IP group was organically, i.e., by promoting senior associates from within the group to partnership. Defendants do not dispute that, in March 2002, Orrick was already exploring the possibility of hiring lateral partners for its New York IP group and, more specifically, of hiring the three attorneys who were brought into the New York IP group as lateral partners in August 2002. However, defendants contend that Cote and Anthony did not represent to Hoeffner that Orrick did not plan to bring any lateral partners into its New York IP group, but specifically informed Hoeffner that Orrick might be bringing lateral partners into that group, and that Orrick planned to grow the New York IP group laterally as well as organically ( see Def. Resp. to Pl. State. of Add. Mat. Iss. of Fact, ¶¶ 54-62).
The parties' conflicting assertions — as to whether Cote and Anthony made representations to Hoeffner to the effect that Orrick did not plan to bring lateral partners into its New York IP group — raise an issue of fact as to the credibility of those parties which I may not properly resolve on this motion, and which precludes summary judgment dismissing Hoeffner's fraudulent inducement claim insofar as it is premised upon those alleged misrepresentations ( see e.g. Ferrante v American Lung Assn., 90 NY2d 623, 631; Hughes v Tishman Constr. Corp. , 40 AD3d 305 , 310 [1st Dept 2007]). Hoeffner may assert a fraudulent inducement claim based upon such misrepresentations in addition to his breach of contract claim because those misrepresentations, if they were made, would be "misrepresentations of present facts (rather than merely of future intent) that were collateral to the contract and which induced the allegedly defrauded party to enter into the contract" ( Orix Credit Alliance v Hable Co., 256 AD2d 114, 115 [1st Dept 1998]).
Apart from the purported misrepresentations to the effect that Orrick was not planning to bring any lateral partners into its New York IP group — which are designated in the complaint by the letters E, F and G — none of the purported misrepresentations enumerated in the first cause of action is actionable as fraud. First, a fraud claim based upon certain of the representations would be no more than an impermissible restatement of Hoeffner's breach of contract claim ( see e.g. id.), because it would fail to allege the breach of any legal duty independent of that purportedly created by the Agreement ( see e.g. Roklina v Skidmore Coll., 268 AD2d 765, 766-767 [3d Dept 2000]). Among those are the representations designated in the complaint by the letters H (that "Plaintiff would be put up/voted on by the Executive Committee for partnership in January 2004"), I (that "Plaintiff's case for partnership would be made by . . . Anthony to the Executive Committee"), S (that "Isackson would be Plaintiff's supporter and work behind the scenes to assist in promoting Plaintiff"), T (that "Cote and Anthony would work behind the scenes to assist in promoting Plaintiff"), X (that "everything was proceeding smoothly according to the plan and partnership for Plaintiff looked good"), Y (that "Anthony would take steps to put Plaintiff up in January 2004"), Z (that "Anthony would be Plaintiff's advocate for partnership"), AA (that "everything [looked] good for partnership' in October 2003"), BB (that "Isackson and Cote would assist in relaying important partnership information to . . . Anthony on Plaintiff's behalf") and CC (that "Anthony would personally speak to Dan Thomasch and Lynne Hermle on Plaintiff's behalf").
Other of the alleged misrepresentations cannot serve as the basis for a fraud claim because they are merely "representation[s] of opinion or . . . prediction[s] of something which is hoped or expected to occur in the future" ( Thomas v McLaughlin, 276 AD2d 440, 440-441 [1st Dept 2000] [citation and internal quotation marks omitted]). Among those are the representations designated in the complaint by the letters A (that "Plaintiff was very highly regarded by the partners at . . . Orrick and had a terrific future"), B (that "Plaintiff had a great future at Orrick"), K (that "Plaintiff was considered a rising star to be considered next year [2005] for partner'"), L (that "Plaintiff's position for partnership was stronger than ever because the Executive Committee was aware of him and would promote Plaintiff next year [2005]"), M (that "Plaintiff would be supported and encouraged for partnership in 2005"), P (that "there is no senior associate bunching' problem and all of the associates can make partner"), R (that "Plaintiff was better off waiting until 2005 to be put up for partner"), U (that "Anthony was personally indebted to Plaintiff for staying at Orrick and . . . Plaintiff now had a chip to cash' with him"), V (that "the end-around' to guarantee partnership for Plaintiff would work"), EE (that "the bar would not be as high in 2005"), FF (that "Ralph Baxter personally told . . . Anthony that he will never allow an associate to be lost because of a numbers [i.e., bunching] problem"), HH (that "Isackson had learned how to promote senior associates to partner and his impotent leadership over the last year would not be repeated in 2004-2005") and II (that "Plaintiff would be put up for partner in January 2005").
Certain of the purported misrepresentations fail as the basis for a fraud claim because the complaint does not allege facts which would indicate "that the defendants knew, at the time [those] alleged misrepresentations were made, that they were false, and that at such time, the defendants had the intent to deceive" ( New York Med. Coll. v Histogenetics, Inc. , 6 AD3d 410 , 411 [2d Dept 2004]; see also Sanyo Elec. v Pinros Gar Corp., 174 AD2d 452, 453 [1st Dept 1991]). Included in that category are the representations designated in the complaint by the letters A, B, C (that "Defendants think Plaintiff is a great lawyer'"), D (that "Plaintiff is important to the firm and the Group'"), J (that "Plaintiff was given an honorable mention to the Executive Committee"), K, L, M, Q (that "Anthony personally spoke to Ralph Baxter about each and every senior associate, including Plaintiff"), R, S, T, U, X, CC, EE, FF, GG (that "Isackson had personally spoke[n] to Dan Thomasch on Plaintiff's behalf"), HH and II.
The element of justifiable reliance is, or would necessarily be, lacking with respect to a fraud claim based upon the purported misrepresentations designated by the letters A, B, C, D, J, K, L, M, N (that the "Executive Committee is a rubber stamp' on partnership issues when a group leader puts up an associate"), O (that the "Executive Committee gives deference to practice group leaders on partnership issues"), P, Q, R, U, V, W (that "the partnership process worked as . . . Anthony and Cote described to Plaintiff"), CC, DD (that "the bar for partnership had been raised too high and . . . too few partners had been made in 2004"), EE, FF, GG and HH. The representations designated by the letters A, B, C, D, J, K, M, P, Q, U, CC, DD, EE, FF, GG and HH are so vague or generalized that Hoeffner could not reasonably have relied upon them as a basis for deciding to pursue any particular course of action or conduct.
Any claim by Hoeffner that he relied upon the purported misrepresentation designated in the complaint by the letter R (that "Plaintiff was better off waiting until 2005 to be put up for partner") is contradicted by his repeated assertions that he did not accede to the Partners' suggestions that he defer for a year — until the partner elevation cycle extending from the end of 2004 into January 2005 — his being put up to the executive committee for partnership consideration.
Hoeffner could not reasonably rely upon the purported misrepresentations designated in the complaint by the letters L, N, O, V and W — the alleged representations by Anthony, Cote and/or Isackson to the effect that, if Hoeffner were put up to the executive committee for partnership by the head of the IP practice group, he would automatically be recommended by the executive committee for election to partnership — because those representations purported to guarantee conduct by the executive committee, a group of which Anthony, Cote and Isackson were not members, and over which Hoeffner had no basis to presume that those Partners exercised unilateral control.
Moreover, the evidence contained in the record indicates that Hoeffner did not, in fact, rely upon those purported representations. The language of the Agreement, which Hoeffner drafted, itself indicates that Hoeffner did not believe that the executive committee's approval and recommendation of a candidate for partnership were automatic. The Agreement states, with respect to partnership consideration in the end of 2003 and beginning of 2004, that "[Anthony] will present my case for partnership to me and I will solely make the determination whether I will be put up for partnership (i.e., voted on in January 2004)." However, Hoeffner's "case for partnership" would presumably have no importance or significance if, as Hoeffner now contends: (1) the Agreement obligated Anthony to put Hoeffner up for partnership if Hoeffner elected to be put up; and (2) the executive committee automatically approved and recommended for partnership each candidate that the head of a practice group put up for partnership. In making Hoeffner's election as to whether he would be put up for partnership dependent upon his "case for partnership," the language of the Agreement impliedly recognizes that the executive committee might decide, based upon Hoeffner's case for partnership, not to approve and recommend Hoeffner for partnership.
Hoeffner's affirmation asserts that he entered into the Agreement "[i]n reliance on Defendants' statements about the Executive Committee rubber stamping my candidacy if I was put up for partner with the full backing of the [Partners], and their representations about their intention not to recruit lateral partners " (Hoeffner Affirm., ¶ 18 [emphasis added]; see also Complaint, ¶ 68). However, Hoeffner's alleged reliance upon the Partners' purported representations that they did not intend to recruit lateral partners clearly indicates his awareness that factors and circumstances apart from whether Anthony put him up for partnership with the full backing of the Partners — e.g., Orrick's partner to associate ratios and the financial considerations implicated by them — could affect the executive committee's decision as to whether it would recommend him for partnership. Thus, Hoeffner was aware that the executive committee's approval and recommendation of a candidate for partnership was not merely a foregone conclusion or a rubber stamp.
Hoeffner also sent two e-mails to a friend and former co-worker which appear to indicate that, at least by April and June of 2003, Hoeffner intended to elect to be put up for partnership in the end of 2003, but did not expect to actually be elected to partnership in January 2004. In an e-mail exchange with the friend on April 11, 2003, concerning Hoeffner's partnership prospects, Hoeffner wrote, "I don't expect to be made a partner this year, but part of what I wanted to do was get into people's psyche that I may be a partner someday so [that] after a year and a half it doesn't seem like a big leap to make me one" (Barber Affirm., Ex. L, at OHS 00000607). In response to an e-mail from the friend on June 10, 2003, which asked whether there had been any mention of partnership, Hoeffner wrote, "No mention of it and I didn't ask. I don't see how they could make me partner this year, but I am still going to make them go through the process" (Ex. M, at OHS 00000438). For all of the foregoing reasons, the first cause of action for fraud in the inducement — except for the portion of that claim which is based upon the Partners' alleged representations to the effect that Orrick was not planning to bring any lateral partners into its New York IP group — is dismissed.
Hoeffner's second cause of action alleges a fraud claim based upon the Partners' purported misrepresentations: (1) that they would give their full support and encouragement for Hoeffner to become a partner, and that Anthony would put Hoeffner up to Orrick's executive committee for partnership, in January 2004; and (2) after Hoeffner was not made a partner in 2004, that the Partners would support him for election to partnership in January 2005. However, the Partners' purported representations that they would give their full support and encouragement for Hoeffner to become a partner, and that Anthony would put Hoeffner up to Orrick's executive committee for election to partnership in January 2004, are the same as the promises contained in the Agreement. Thus, the second cause of action is dismissed, insofar as it is based upon those representations, because that portion of the claim is no more than an impermissible restatement of Hoeffner's breach of contract claim.
The portion of the second cause of action which is predicated upon the Partners' purported representations that they would support Hoeffner for election to partnership in January 2005 fails, inter alia, because Hoeffner cannot establish the element of justifiable reliance with respect to a claim based upon those representations. Hoeffner purportedly knew no later than February 2, 2004 that — although he had allegedly exercised his option to be put up to the executive committee for election to partnership in January 2004 ( see Pl. Mem. of Law in Supp., at 5; Pl. Mem. of Law in Furth. Supp., at 2) — the Partners had failed to honor their purported promises to support him for partnership, and to put him up for election to partnership, in January 2004 ( see Complaint, ¶¶ 90, 103-104; see also Pl. Resp. to Def. State. of Undisp. Facts, ¶¶ 76 [stating that the Partners informed Hoeffner on December 16, 2003 "that they had elected not to put him up for partner in 2003 and had not presented his name among the list of candidates for partnership to the Executive Committee, as they agreed"], 86 [stating that "Defendants waited to tell Plaintiff that he had not been put up for partner until mid-January 2004"]). Thus, Hoeffner could not reasonably have relied upon the Partners' purported representations that they would support him for election to partnership in January 2005, after he already allegedly knew that they had failed to honor their promises that they would support him for election to partnership in January 2004. The second cause of action is, therefore, dismissed.
The third cause of action alleges that the Partners fraudulently concealed from Hoeffner the purported facts: that Orrick was hiring or recruiting lateral partners for its New York IP group in 2002; that the Partners were not going to support Hoeffner for partnership, and that Anthony was not going to put him up for partnership, in January 2004; and that the Partners were not going to promote Hoeffner or put him up for partnership in 2005. To prevail upon a claim of fraudulent concealment, a plaintiff must establish — in addition to the elements required for a claim of fraudulent misrepresentation — that the defendant had a duty to disclose material information which was concealed ( see Swersky v Dreyer Traub, 219 AD2d 321, 326 [1st Dept 1996]).
For the reasons already set forth in connection with Hoeffner's first cause of action, defendants have failed to establish their entitlement to dismissal of so much of the third cause of action as is based upon the Partners' alleged fraudulent concealment of the fact that, in March 2002, Orrick was hiring or recruiting lateral partners for its New York IP group. While the requisite duty to disclose cannot be deemed to have arisen by reason of the employment relationship, such a duty may arguably have arisen under the "special facts" doctrine. Pursuant to that doctrine, "a duty to disclose arises where one party's superior knowledge of essential facts renders a transaction without disclosure inherently unfair" ( id. [citation and internal quotation marks omitted]). There is an issue of fact as to whether this case falls within the ambit of the special facts doctrine in view of the circumstances that: the Partners were apparently privy to information concerning Orrick's plans and recruiting activities with respect to potential lateral partners for the New York IP group in March 2002; it is not clear that Hoeffner could have obtained that information independently through the exercise of reasonable intelligence and diligence; and Orrick's plans to bring lateral partners into the New York IP group would presumably have been material to Hoeffner's decision to enter into the Agreement ( see id.).
The remainder of the third cause of action is substantially duplicative of portions of the fraud claims alleged in the first and second causes of action which are being dismissed, and is dismissed for the reasons already set forth in connection with those causes of action.
Defendants argue that Hoeffner's three causes of action for fraud should be dismissed in their entirety on the ground that those claims fail to allege any damages which are recoverable on a fraud claim. The measure of the damages which are recoverable for fraud is "indemnity for the actual pecuniary loss sustained as the direct result of the wrong or what is known as the out-of-pocket rule" ( Lama Holding Co. v Smith Barney, 88 NY2d at 421 [citations and internal quotation marks omitted]). Under the out-of-pocket rule, "[d]amages are to be calculated to compensate plaintiffs for what they lost because of the fraud, not to compensate them for what they might have gained," and "there can be no recovery of profits which would have been realized in the absence of fraud" ( id.).
None of the damages alleged in Hoeffner's fraud claims is the sort of actual pecuniary loss which is recoverable under the out-of-pocket rule. The first cause of action alleges that Hoeffner suffered damages from: (1) "harm to his career development, with future employers within the legal services industry generally"; (2) "severe mental anguish and emotional distress, including but not limited to, physical manifestation of stress causing excruciating pain and discomfort, loss of self-esteem and self-confidence, loss of career fulfillment, loss of sleep, and continual stress, anxiety and uncertainty over [his] ability to meet his personal and familial financial obligations"; (3) the loss of the "job security, substantial monetary compensation and other benefits attendant to his continued employment with Orrick"; and (4) "harm to his professional and personal reputations" (Complaint, ¶ 142).
Damages are not recoverable under the out-of-pocket rule for injury to "career development," or for the loss of "enhanced earning potential" that would allegedly have been realized in the absence of fraud ( Geary v Hunton Williams, 257 AD2d 482, 482 [1st Dept 1999]), or for mental anguish and emotional distress ( see Scivoli v Levit , 45 AD3d 667 , 668 [2d Dept 2007]; Jeffrey BB. v Cardinal McCloskey School Home for Children, 257 AD2d 21, 24 [3d Dept 1999]). Moreover, the first, third and fourth types of damages sought are not recoverable because Hoeffner has failed to aver facts which would indicate that such damages, insofar as they were incurred, were proximately caused by the alleged fraud, rather than by other factors and circumstances including, e.g., the termination of Hoeffner's employment and his commencement of this action ( see Wall St. Transcript Corp. v Ziff Communications Co., 225 AD2d 322, 322 [1st Dept 1996]).
The second cause of action alleges that Hoeffner suffered damages from his loss of "the opportunity to become partner and loss of salary for the remainder of his career" (Complaint, ¶ 157). Those damages are not recoverable because they seek to compensate Hoeffner for what he might have gained, and to recover earnings that he might have realized, in the absence of fraud. The damages sought in the second cause of action are, in fact, essentially benefit-of-the-bargain damages of the sort awarded for a breach of contract, a circumstance which further supports the previously stated determination that the second cause of action is merely an impermissible restatement of the complaint's fourth cause of action for breach of contract.
Hoeffner's third cause of action alleges seven types of damages, four which are the same as those alleged in the first cause of action and three which are predicated upon Hoeffner's alleged loss of: (1) "time building equity with his employer"; (2) "time creating professional relationships with partners at his firm"; and (3) "relationships with experts and in-house counsel" (Complaint, ¶ 168 [E], [F], [G]). The three latter types of damages are not recoverable on a fraud claim since, again, they are essentially damages for the loss of enhanced earning potential and injury to career development.
In opposition to defendants' motion, Hoeffner asserts that he is entitled to recover, as damages on his fraud claims, the compensation that he would have earned if he had accepted either of the offers of employment that were extended to him by Chadbourne and another law firm, instead of rejecting those offers in reliance upon the Partners' purportedly fraudulent misrepresentations ( see Pl. Mem. of Law in Opp., at 22-23). However, the out-of-pocket rule "bars recovery of profits that would have been realized in the absence of fraud, including the loss of an alternative bargain overlooked in favor of the fraudulent one, as inherently speculative and undeterminable" ( Geary v Hunton Williams, 257 AD2d at 482; see also Lama Holding Co. v Smith Barney, 88 NY2d at 422; Alpert v Shea Gould Climenko Casey, 160 AD2d 67, 72 [1st Dept 1990]). Thus, Hoeffner cannot recover damages on his fraud claim which would compensate him for the benefit of employment opportunities that he overlooked in favor of continuing his employment with Orrick, albeit allegedly in reliance upon the Partners' fraudulent misrepresentations.
Although Hoeffner's first, second and third causes of action have failed to allege any actual damages that are recoverable on a fraud claim, New York courts have generally followed the rule that — where a transaction has been induced by fraud, and the defrauded party is unable to establish any actual damages — the party which committed the fraud "is liable to the defrauded party, to pay, at least, nominal damages" ( Northrop v Hill, 57 NY 351, 354; see also Clearview Concrete Prods. Corp. v S. Charles Gherardi, Inc., 88 AD2d 461, 470 [2d Dept 1982]; 60A NY Jur 2d, Fraud and Deceit § 257). Therefore, the first and third causes of action — insofar as they are based upon, respectively, the Partner's purported misrepresentations to the effect that Orrick did not plan to bring any lateral partners into its New York IP group and the Partners' purported concealment of the alleged fact that Orrick did plan to bring lateral partners into its New York IP group — may proceed upon a theory of nominal damages.
The complaint's fifth cause of action, a claim under the theory of promissory estoppel, alleges that Hoeffner suffered substantial damages as a result of his reliance upon: (1) the Agreement, and the Partners' promises that they would support and encourage Hoeffner for partnership, and that Anthony would put Hoeffner up to the executive committee for election to partnership, in January 2004; and (2) the Partners' promises that they would support and encourage Hoeffner for partnership, and that Hoeffner would be elevated to partnership, in January 2005.
The elements of a cause of action based upon promissory estoppel are a clear and unambiguous oral promise, reasonable reliance upon the promise and injury caused by the reliance ( New York City Health and Hosps. Corp. v St. Barnabas Hosp. , 10 AD3d 489 , 491 [1st Dept 2004]). However, a "breach of contract claim may not be considered a tort unless a legal duty independent of the contract — i.e., one arising out of circumstances extraneous to, and not constituting elements of, the contract itself — has been violated" ( Brown v Brown , 12 AD3d 176 , 176-177 [1st Dept 2004]). "In the absence of a duty independent of the agreement, [a] promissory estoppel claim [is] duplicative of [a] breach of contract claim" ( Celle v Barclays Bank P.L.C. , 48 AD3d 301, 303 [1st Dept 2008]).
Insofar as Hoeffner's promissory estoppel claim is predicated upon the Partners' purported failure to honor the promises set forth in the Agreement — or oral promises that they would support and encourage Hoeffner for partnership, or that Anthony would put Hoeffner up to the executive committee for partnership, in January 2004 — the claim is precluded, because it fails to allege the breach of any duty independent of the Agreement. Hoeffner's promissory estoppel claim also fails insofar as it is predicated upon the Partners' alleged failure to honor their promises that they would support and encourage Hoeffner for partnership, and that Hoeffner would be elevated to partnership, in January 2005. Hoeffner apparently maintains that he relied upon those alleged promises by staying at Orrick until April 2004, when the Applera Litigation ended, or until November 2004, when he was allegedly told to look for new employment. As set forth in the discussion of the second cause of action, Hoeffner could not reasonably have relied upon the Partners' purported promises that they would support and encourage him for partnership, and that he would be elevated to partnership, in January 2005, after Hoeffner already allegedly knew that the Partners had failed to honor substantially similar promises relating to his being elevated to partnership in January 2004.
The seventh cause of action, for unjust enrichment, alleges that "[d]efendants have unjustly benefitted from Plaintiff's continued billing because Plaintiff's compensation was far less than the amounts recovered by Orrick for his legal services" (Complaint, ¶ 191), and because, although "[d]efendants utilized Plaintiff's expertise, experience, relationships, and background to obtain additional legal work and maintain current legal work," which "resulted in additional revenue to Orrick," "Plaintiff did not receive any additional compensation" (Complaint, ¶ 193).
In order to prevail upon a claim of unjust enrichment, a plaintiff must demonstrate that he or she "conferred a benefit upon the defendant, and that the defendant will obtain such benefit without adequately compensating plaintiff therefor" ( Nakamura v Fujii, 253 AD2d 387, 390 [1st Dept 1998]). "[T]he essential inquiry in any action for unjust enrichment . . . is whether it is against equity and good conscience to permit the defendant to retain what is sought to be recovered" ( Sperry v Crompton Corp. , 8 NY3d 204 , 215 [citation and internal quotation marks omitted]; see also Dragon Inv. Co. II LLC v Shanahan , 49 AD3d 403, 405 [1st Dept 2008]).
Assuming that Orrick paid Hoeffner less in compensation for his services than Orrick charged clients for those services, that would not support a claim for unjust enrichment. That is the manner in which professional service firms generally operate, and Hoeffner was presumably aware of that fact — and of the amount of the salary which Orrick agreed to pay him for his services — both when he accepted, and so long as he continued, his employment with Orrick. Also precluding a determination that it would be against equity and good conscience for Orrick to retain the amounts that it recovered from clients for Hoeffner's services, over and above the amount that it paid to Hoeffner, are the facts, inter alia, that: (1) Hoeffner received a $10,000 per year salary increase as the result of his agreeing to stay at Orrick in March 2002 ( see Hoeffner EBT, at 380-382; Barber Affirm., Ex. I, ¶ 1); and (2) although Hoeffner concededly "went for long stretches without any work whatsoever" after April 2004 (Complaint, ¶ 128), Orrick continued to pay him a salary even after November 20, 2004, when he was told to look for new employment, and until May 20, 2005 ( see Hoeffner EBT, at 622).
The eighth cause of action alleges that defendants breached their fiduciary duties to Hoeffner by "failing and refusing to promote Plaintiff despite the [Agreement] and promises to do so in 2004 and 2005, respectively" (Complaint, ¶ 206). Insofar as Hoeffner's breach of fiduciary duty claim is predicated upon the Partners' alleged failure to honor the promises set forth in the Agreement — or other promises that they would give their full support and encouragement in helping Hoeffner to become a partner, or that Anthony would put him up to the executive committee for election to partnership, in January 2004 — the claim is duplicative or redundant of Hoeffner's breach of contract claim, because it fails to allege the Partners'"breach of a duty other than, and independent of, that contractually established between the parties" ( Kaminsky v FSP Inc. , 5 AD3d 251 , 252 [1st Dept 2004]; see also William Kaufman Org. v Graham James, 269 AD2d 171, 173 [1st Dept 2000]).
Moreover, Hoeffner's breach of fiduciary duty claim fails to allege facts indicating the existence of a fiduciary duty which could be breached. The complaint alleges that the Partners had a fiduciary duty to Hoeffner because: he trusted the Partners and was confident in their integrity and fidelity; he was subordinate to the Partners, and "vulnerable to their decisions and desires"; and the partnership elevation process at Orrick being secret, Hoeffner necessarily relied upon the Partners' assurances "that what they were doing would result in him becoming a partner" (Complaint, ¶¶ 198-203).
As a general rule, no fiduciary relationship exists between an employer and an employee by reason of the employment relationship ( see e.g. Schenkman v New York Coll. of Health Professionals , 29 AD3d 671 , 672 [2d Dept 2006]; Weintraub v Phillips, Nizer, Benjamin, Krim, Ballon, 172 AD2d 254, 254, [1st Dept 1991]). The alleged fact that Hoeffner trusted the Partners and/or was confident in their integrity and fidelity, even if true, did not give rise to a fiduciary duty as between Hoeffner, on the one hand, and Orrick and/or the Partners, on the other ( see Freedman v Pearlman, 271 AD2d 301, 305 [1st Dept 2000]). Nor, assuming that Hoeffner was subordinate to the Partners, and vulnerable to their decisions and desires, did that distinguish his employment from that of the majority of employees, who are subordinate to their superiors and vulnerable to their decisions and desires without those circumstances giving rise to a fiduciary relationship.
Hoeffner alleges, as a third basis for a fiduciary relationship, that he necessarily relied upon the Partners' assurances that that what they were doing would result in him becoming a partner, because they were privy to information concerning the partnership elevation process at Orrick, by virtue of their position, and he was not. A fiduciary relationship may arise between parties, in certain instances, where one party "repose[s] confidence in another and reasonably relie[s] on the other's superior expertise or knowledge" ( Sergeants Benevolent Assn. Annuity Fund v Renck , 19 AD3d 107, 110 [1st Dept 2005] [citation and internal quotation marks omitted]). However, insofar as Hoeffner's breach of fiduciary duty claim does not merely restate his breach of contract claim, it presumably depends upon Hoeffner's having reasonably relied upon the Partners' purportedly superior knowledge or expertise relating to their alleged statements to the effect that, when an associate was put up for partnership, the executive committee's approval and recommendation of the associate for partnership was a mere formality, or rubber stamp. As previously stated, the record contradicts Hoeffner's allegations that he could or did reasonably rely upon any statements that the Partners may have made to the foregoing effect. Therefore, inasmuch as Hoeffner has failed to adequately allege or establish the existence of any superior expertise or knowledge upon which he actually relied so as to give rise to a fiduciary duty ( see Continental Cas. Co. v AON Risk Servs. Cos., Inc. , 50 AD3d 315, 316 [1st Dept 2008]), his claim for breach of fiduciary duty is dismissed.
The ninth cause of action alleges that the Partners caused Hoeffner severe emotional distress by: entering into the Agreement with Hoeffner to promote and put him up for partnership in January 2004, knowing that it was the only way to keep Hoeffner and the Conductus Litigation at Orrick, and then breaching that agreement; and promising to promote and put Hoeffner up for partnership in 2005, knowing that it was a way to keep Hoeffner at Orrick and at work on the Applera Litigation, and then, when that litigation ended, telling Hoeffner to look for other employment.
The tort of intentional infliction of emotional distress has four elements: "(i) extreme and outrageous conduct; (ii) intent to cause, or disregard of a substantial probability of causing, severe emotional distress; (iii) a causal connection between the conduct and injury; and (iv) severe emotional distress" ( Howell v New York Post Co., 81 NY2d 115, 121). Courts have generally found the first element to be present "only where the conduct has been so outrageous in character, and so extreme in degree, as to go beyond all possible bounds of decency, and to be regarded as atrocious, and utterly intolerable in a civilized community" ( id. at 122 [citation and internal quotation marks omitted]; see also Restatement [Second] of Torts § 46, Comment d). "Whether the conduct alleged may reasonably be regarded as so extreme and outrageous as to permit recovery is a matter for the court to determine in the first instance" ( Stuto v Fleishman, 164 F3d 820, 827 [2d Cir 1999] [applying New York law]).
Hoeffner has failed to allege conduct by the Partners which is sufficiently extreme and outrageous as to sustain a cause of action alleging intentional infliction of emotional distress. In the employment context, conduct has rarely been held to reach the requisite degree of extremeness and outrageousness where a plaintiff has not alleged "some combination of public humiliation, false accusations of criminal or heinous conduct, verbal abuse or harassment, physical threats, permanent loss of employment, or conduct contrary to public policy" ( Ortiz v Brookstone Co., 274 F Supp 2d 456, 466 [SD NY 2003] [applying New York law, citation and internal quotation marks omitted]; see also Stuto v Fleishman, 164 F3d at 828). Hoeffner has failed to allege that any of those forms of conduct or circumstances occurred. Moreover, insofar as the claim is based upon allegations that the Partners entered into the Agreement with Hoeffner to promote and put him up for partnership in January 2004, and then breached that agreement, the claim fails because, "absent a duty upon which liability can be based, there is no right of recovery for mental distress resulting from the breach of a contract-related duty" ( Rakylar v Washington Mut. Bank , 51 AD3d 995 , 996 [2d Dept 2008] [citation and internal quotation marks omitted]; see also Wehringer v Standard Sec. Life Ins. Co. of NY, 57 NY2d 757, 759; Fleming v Allstate Ins. Co., 106 AD2d 426, 426 [2d Dept 1984], affd 66 NY2d 838, cert denied 475 US 1096).
With respect to so much of the claim as is predicated upon the Partners having promised to promote and put Hoeffner up for partnership in 2005, and then terminated his employment, courts have held that the act of terminating a plaintiff's employment "may not form the basis of an intentional infliction of emotional distress cause of action in circumvention of the at-will employment rule in New York" ( Fama v American Intl. Group, 306 AD2d 310, 311-312 [2d Dept 2003]; see also Abeles v Mellon Bank Corp., 298 AD2d 106, 106 [1st Dept 2002]).
Hoeffner's sixth cause of action alleges that defendants engaged in a civil conspiracy to induce Hoeffner to remain at Orrick, although they knew that they were not going to promote him or put him up for partnership in 2004 or 2005, because they wanted to keep the Conductus Litigation at Orrick and/or to keep Hoeffner working on the Applera Litigation. Defendants argue that Hoeffner's conspiracy claim should be dismissed because a civil conspiracy claim cannot be sustained in the absence of an underlying, independent tort. However, inasmuch as defendants have failed to establish their entitlement to dismissal of the fraud claims alleged in the first and third causes of action, defendants have also failed to establish their entitlement to dismissal of Hoeffner's conspiracy claim solely upon the ground that he has not alleged a viable independent tort.
Hoeffner's Cross Motion for Summary Judgment
Hoeffner's cross motion for summary judgment on the complaint's fourth and fifth causes of action, which allege claims for breach of contract and promissory estoppel, is denied.
As previously stated, the fourth cause of action alleges that the Partners breached the Agreement when the Partners did not provide their full support and encouragement in helping Hoeffner to become a partner in January 2004, and when Anthony did not put Hoeffner up to the executive committee for partnership in the end of 2003 and/or beginning of 2004. However, the Agreement provided that:
[Anthony] will present [Hoeffner's] case for partnership to [Hoeffner] and [Hoeffner] will solely make the determination whether [Hoeffner] will be put up for partnership. . . . Should [Hoeffner] choose to be voted on, at least [Anthony, Cote, and Isackson] will give their full support and encouragement in helping [Hoeffner] become a partner.
(Barber Affirm., Ex. I.) Thus, the Partners' performance of their obligations under the Agreement was contingent upon Hoeffner's election to be put up for partnership.
The Partners contend that — at a meeting between Anthony and Hoeffner on October 30, 2003, after Anthony presented Hoeffner's "case for partnership" to Hoeffner — Hoeffner elected not to be put up for partnership. Anthony asserts that, while attempting to build Hoeffner's case for partnership in the fall of 2003, he learned that the executive committee would be scrutinizing evidence concerning each partnership candidate's ability to develop business for Orrick more closely that year than in prior years, and concluded that there was no possibility that Hoeffner could achieve partnership in January 2004 ( see Anthony EBT, at 302). Anthony claims that he advised Hoeffner that his chances of becoming partner in January 2004 were hopeless, that he "laid out a plan" for Hoeffner to become partner in January 2005, and that Hoeffner "accepted my view that it was hopeless, and . . . accepted my recommendation that we reset him" for being put up for partnership in the end of 2004 ( id. at 305-307). According to Anthony, "[t]his was my conversation with Hoeffner. There was no question about it. We didn't use formalized legal terms, but we had a meeting of the minds on that point" ( id. at 305).
Hoeffner asserts, to the contrary, that Anthony did not counsel him at the October 30th meeting that he should wait to be put up for partner until the end of 2004 ( see Hoeffner EBT, at 453). Hoeffner "absolutely den[ies] that [he] agreed to wait a year in that meeting" ( id.). Hoeffner stated at his deposition that — while he did not recall whether he explicitly told Anthony at the meeting that he wanted to be put up for partnership in the end of 2003 and beginning of 2004 — "there would be no reason for me to say that explicitly. Because the discussion was about providing information for my story because I was going to be" put up for partnership ( id.). Although the Partners concede that Hoeffner did unequivocally tell Anthony on December 16, 2003 that he wanted to be put up for election to partnership in January 2004 ( see Def. Mem. of Law in Opp., at 4), the Partners contend that, by that time, the partnership nomination process had already proceeded to a point where Hoeffner's attempt to exercise his option to elect to be put up for partnership under the Agreement was untimely, and did not trigger the Partners' obligations under that agreement.
Hoeffner's and Anthony's differing assertions as to what occurred at the meeting on October 30, 2003 — and whether Hoeffner did or did not timely exercise his option to be put up for election to partnership in January 2004 — raise an issue of fact which precludes summary judgment in Hoeffner's favor on his fourth cause of action for breach of contract. Hoeffner's cross motion for summary judgment is also denied with respect to the complaint's fifth cause of action for promissory estoppel, inasmuch as that claim is being dismissed, for the reasons previously set forth.
Hoeffner's Motion to Strike
Hoeffner's motion for an order "striking portions of Defendants' Motion for Summary Judgment and Defendants' Memorandum of Law in Support of their Motion for Summary Judgment" (Notice of Motion) is denied in its entirety. Hoeffner argues that defendants' motion for summary judgment should be stricken, or dismissed, because it fails to satisfy the requirement of CPLR 3212 (b) that a motion for summary judgment shall be supported by an affidavit "by a person having knowledge of the facts." Defendants' motion is deficient, according to Hoeffner, because defendants have submitted only an affirmation by their attorney, to which exhibits in support of the motion are attached.
Hoeffner presumably seeks to have defendants' motion denied for failure to submit an affidavit by an individual having personal knowledge of the relevant facts, rather than to have the motion stricken or dismissed. However, where a defendant puts forth "sufficient evidentiary proof in admissible form," "[t]he fact that [the] defendant's supporting proof [is] placed before the court by way of an attorney's affidavit annexing plaintiff's deposition testimony and other proof, rather than affidavits of fact on personal knowledge, does not defeat [the] defendant's right to summary judgment" ( Olan v Farrell Lines, 64 NY2d 1092, 1093; see also Lewis v Safety Disposal Sys. of Pa., Inc. , 12 AD3d 324 , 325 [1st Dept 2004] [stating that "an attorney's affirmation may serve as a vehicle to introduce documentary evidence in support of a motion for summary judgment"]; Eldon Group Am. v Equiptex Indus. Prods. Corp., 236 AD2d 329, 329 [1st Dept 1997] [finding that the plaintiff in that case had "proved a prima facie case [of entitlement to summary judgment] through the affirmation of its attorney based upon documentary evidence"]). Here, the affirmation by defendants' attorney does not purport to be anything other than a vehicle for introducing into evidence exhibits consisting of deposition testimony and documents produced in discovery in this case, and Hoeffner does not dispute the authenticity of any of those exhibits. Thus, Hoeffner has failed to establish that defendants' motion should be denied merely because defendants have not supported their motion with an affidavit by a person having knowledge of the relevant facts.
Hoeffner also moves to have stricken from defendants' memorandum of law the particular statements that: (1) "Patrick Hoeffner is an angry man"; (2) failure to make partner "occurs to many talented young lawyers at many different law firms all the time"; (3) "Hoeffner stole sensitive partner-level documents from the Orrick firm"; (4) "[a]s is true of almost every other large law firm in the United States, associates at Orrick are at will' employees"; (5) "the evidence at trial will show that, during this period, Hoeffner was avoiding a direct conversation with Anthony on the subject"; (6) "Bill Anthony will testify that, in this conversation, he reminded Hoeffner of their prior October 30 agreement, told Hoeffner it was now too late to be considered in 2003, but agreed, nevertheless, to see what he could accomplish at that late date"; (7) Hoeffner "began the practice of stealing sensitive documents from the firm"; and (8) "[i]n an exercise of poor judgment, however, Hoeffner failed to tell Fulbright that he was contemplating this lawsuit" (Def. Mem. of Law in Supp., at 3). Hoeffner argues that those statements should be stricken because they are unsupported by admissible evidence, and because defendants should not be permitted to rely on conjecture to substantiate their motion for summary judgment.
Hoeffner has failed to cite any legal authority which would support the striking of any of the statements enumerated above. As Hoeffner himself correctly asserts, the foregoing statements are "entirely irrelevant to Defendants' summary judgment motion" (Pl. Mem. of Law in Supp., at 4). Thus, whether or not the statements are accurate or supported by admissible evidence is irrelevant to a determination of defendants' motion, and I have not assumed the truth of any of the statements in determining that motion. In support of his motion to strike, Hoeffner has cited cases where courts denied motions for summary judgment because the proponent of the motion failed to satisfy its burden of introducing sufficient evidence to establish its entitlement to judgment to the preclusion of any issue of fact, and attempted to rely, instead, upon inadmissible evidence and/or unsubstantiated conjecture to satisfy its burden. None of the cited cases stands for the proposition that a court should strike statements from a memorandum of law simply because the statements are irrelevant to the motion or unsubstantiated by admissible evidence. Nor do any of the cases cited by Hoeffner support the proposition that a summary judgment motion should be denied — even where the proponent of such a motion has satisfied its burden of introducing sufficient evidence to establish its entitlement to judgment to the preclusion of any issue of fact — simply because the proponent has included statements in its memorandum of law which are irrelevant to the motion and/or not substantiated by admissible evidence.
Hoeffner's Motion for Summary Judgment
Hoeffner's motion for summary judgment (sequence number 007), which is the same as Hoeffner's cross motion for summary judgment (sequence number 005), is denied for the reasons already stated in connection with the cross motion.
CONCLUSION AND ORDER
For the foregoing reasons, it is hereby
ORDERED that defendants' motion for summary judgment (sequence number 005) is granted, in part, to the extent that: (a) the complaint's second, fifth, seventh, eighth and ninth causes of action are dismissed in their entirety; (b) the first cause of action is dismissed except insofar as it is based upon purported misrepresentations to the effect that defendant Orrick, Herrington Sutcliffe LLP (Orrick) had no plans to bring any lateral partners into its New York intellectual property (IP) group and seeks nominal damages; (c) the third cause of action is dismissed except insofar as it is based upon defendants' purported concealment of Orrick's plans to bring lateral partners into its New York IP group and seeks nominal damages; and (d) the fourth cause of action is dismissed except insofar as it seeks nominal damages; and it is further
ORDERED that plaintiff's cross motion for summary judgment (sequence number 005) is denied; and it is further
ORDERED that plaintiff's motion (sequence number 006) to strike portions of defendants' motion for summary judgment and defendants' memorandum of law in support of that motion is denied; and it is further
ORDERED that plaintiff's motion for summary judgment (sequence number 007) is denied; and it is further
ORDERED that the complaint's first, third, fourth and sixth causes of action, as delimited herein, shall continue.