Arias v. Solis
| Citation | 754 F. Supp. 290 |
| Decision Date | 08 January 1991 |
| Docket Number | No. CV-90-4443 (ADS).,CV-90-4443 (ADS). |
| Parties | Ciriaco ARIAS, Plaintiff, v. Julian SOLIS, J. Russell Peltz and Peltz Boxing Promotions, Inc., Defendants. |
| Court | United States District Courts. 2nd Circuit. United States District Court (Eastern District of New York) |
Steven Sarshik, Garden City, N.Y. (Louis Rosenstock, of counsel), for plaintiff.
Roemer & Featherstonhaugh, P.C., New York City (Christopher M. Houlihan, Anthony Giardina, of counsel), for defendants.
Pursuant to an order to show cause signed by Judge Edward R. Korman on December 26, 1990, plaintiff, a boxing manager, moves for a preliminary injunction to enjoin the defendant, Julian Solis, a professional boxer, from engaging in any boxing exhibitions, in particular a boxing match presently scheduled for Tuesday evening, January 8, 1991 with one Calvin Grove, without first obtaining the express prior approval and consent of the plaintiff pursuant to the contract between the parties.
Plaintiff Ciriaco Arias ("Arias"), is a boxing manager licensed by the New York State Athletic Commission. Defendant Julian Solis ("Solis"), is a professional boxer who was at one time the bantamweight champion of the world in the early 1980's.
Arias and Solis entered into a two-year contract on April 2, 1990 for Arias to act as a boxing manager for Solis ("Management Contract"). The contract is a standard one-page "Boxer-Manager Contract", filed with and approved by the New York State Athletic Commission ("NYAC"). The contract provides, in relevant part, as follows:
In accordance with the NYAC regulations, the contract further provides that Arias is to receive one-third of any monies earned by Solis.
Arias contends that he arranged for Solis to partake in several fights throughout 1990, but Solis thereafter refused or failed to participate in the fights. Arias also contends that despite the existence of the above contract, Solis entered into a separate agreement with a boxing promoter, defendant Peltz Boxing Promotions, Inc. and J. Russell Peltz (collectively "Peltz"), for Arias to fight Calvin Grove in Philadelphia on January 8, 1991 ("the Grove Bout").
It is undisputed that Solis entered into the Grove Bout agreement with the defendants in contravention of the express terms of the Management Contract, since he did not first obtain the approval of Arias. However, Solis has agreed to pay Arias his share of the purse due under the Management Contract from the Grove Bout.
Arias commenced this action seeking damages for breach of contract and a permanent injunction to enjoin Solis from participating in any exhibitions without the prior consent of Arias. In addition, Arias is suing Peltz for intentionally inducing Solis to breach his contract with Arias, and for interference by Peltz with his contractual relationship with Solis. Arias alleges that he has sustained damages by reason of the breach of contract by Solis since Arias has expended money to train Solis and in scheduling the various fights which Solis never fought. Arias also contends that Solis is not qualified to fight Calvin Grove; it would be detrimental to his career if he did so; and this fight would endanger the career of Solis thereby depriving Arias of income under the Management Contract.
Arias bases federal jurisdiction on diversity under 28 U.S.C. § 1332(a), and claims damages of $150,000 in the complaint.
The defendants oppose this application on three grounds: First, there is no diversity jurisdiction since the plaintiff has failed to meet the threshold amount of $50,000. Second, the Court lacks personal jurisdiction over the Peltz defendants. Third, the plaintiff has failed to meet the traditional elements for obtaining a preliminary injunction in this Circuit.
This Court held oral argument on Friday, January 4, 1991, which argument was continued on Monday, January 7, 1991. Although the Court read this decision into the record at oral argument on January 7, 1991, the following constitutes the Court's findings of fact and conclusions of law (see Fed.R.Civ.P. 52a; Weitzman v. Stein, 897 F.2d 653, 658 2d Cir.1990).
As stated above, the defendants challenge this motion for a preliminary injunction preventing Solis from fighting Calvin Grove on the evening of Tuesday, January 8, 1991, on three grounds, namely, lack of diversity jurisdiction, lack of personal jurisdiction and failure to meet the standards for obtaining a preliminary injunction.
As to the "amount in controversy" requirement for diversity jurisdictional purposes, the plaintiff alleges the following:
The defendants contend that since the plaintiff alleges that he seeks reimbursement for expenses in the sum of $8,000 and that concededly the Grove Bout purse is only $5,000, of which the plaintiff is to receive one-third or $1667, the plaintiff cannot demonstrate that the amount in controversy exceeds $50,000, the jurisdictional predicate.
All diversity actions filed on or after May 19, 1989 must allege that the amount in controversy exceeds $50,000 (see 28 U.S.C. § 1332a, Pub.L. 100-702). In determining whether the required "amount in controversy" has been met, the Supreme Court enunciated the following standard:
(St. Paul Mercury Indemnity Co. v. Red Cab Co., 303 U.S. 283, 288-89, 58 S.Ct. 586, 590, 82 L.Ed. 845 1938).
In making this determination, the "district courts are not restricted by the rule ... from looking further than the plaintiff's complaint in deciding whether a controversy involves recoverable sums in excess of" the required jurisdictional amount (Deutsch v. Hewes Street Realty Corp., 359 F.2d 96, 100 2d Cir.1966; see also 1 C. Miller, Cyclopedia of Federal Practice § 2.185, at p. 506 3d ed.1989 importance attached to amount alleged in ad damnum clause, but court must also look to facts alleged in complaint to determine whether the case is within federal court jurisdiction). "Speculative allegations of indirect, nonpecuniary benefits may not be used to meet the amount in controversy requirement" (see Black v. Beame, 550 F.2d 815, 817 2d Cir.1977 citation omitted), and "the jurisdictional test is applicable to that amount that flows directly and with a fair degree of probability from the litigation, not from collateral or speculative sources" (Kheel v. Port of New York Authority, 457 F.2d 46, 49 2d Cir.1972 emphasis supplied). The Court, of course, is not to "delve into the comparative merits of a case when deciding the issue of jurisdictional amount" (Liamuiga Tours v. Travel Impressions, Ltd., 617 F.Supp. 920, 928 E.D.N.Y.1985).
The Second Circuit set forth the applicable standard as follows:
(Zacharia v. Harbor Island Spa, Inc., 684 F.2d 199, 202 2d Cir.1982 citations omitted; emphasis supplied).
(See also Hunt v. Washington State Apple Advertising Comm'n, 432 U.S. 333, 346, 97 S.Ct. 2434, 2443, 53 L.Ed.2d 383 1977; Halmos v. Pan Am. World Airways, Inc., 727 F.Supp. 122, 125 S.D.N.Y.1989; Moore's Federal Practice ¶ 0.921, at pp. 852-59 2d ed. 1990).
Applying the standard set forth in Zacharia v. Harbor Island Spa, Inc., supra, the Court finds that the plaintiff has sufficiently alleged the requisite jurisdictional amount for purposes of satisfying the provisions of 28 U.S.C. § 1332(a). While there appears to be little support for the alleged $150,000 in damages claimed, the defendants have not demonstrated to a legal certainty that Arias is not entitled to damages in excess of $50,000 (see Liamuiga Tours v. Travel Impressions, Ltd., supra, 617 F.Supp. at p. 929), or that the plaintiff's claimed prospective damages for breach of contract are alleged in bad faith to simply meet the jurisdictional requirement (see Halmos v. Pan Am. World Airways, Inc., supra, 727 F.Supp. at p. 125).
In fact, at oral argument on January 7, 1991, counsel for the plaintiff offered a letter in evidence written in Spanish indicating that negotiations for a fight with the world champion Esparragoza are...
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