Demartino v. New York

• Decision Date: 24 June 2013
• Docket Number: 12-CV-3319 (SJF)(AKT)
• Parties: THOMAS DEMARTINO and FRANK DEMARTINO, Plaintiffs, v. STATE OF NEW YORK, TOWN OF HUNTINGTON, INTERNAL REVENUE SERVICE, STATE OF NEW YORK COMMISSIONER OF TAXATION AND FINANCE, and JOHN DOES # 1-5, Defendants.
• Court: U.S. District Court — Eastern District of New York

THOMAS DEMARTINO and FRANK DEMARTINO, Plaintiffs,

v. STATE OF NEW YORK, TOWN OF HUNTINGTON,INTERNAL REVENUE SERVICE, STATE OF NEW YORK COMMISSIONEROF TAXATION AND FINANCE, and JOHN DOES # 1-5, Defendants.

12-CV-3319 (SJF)(AKT)

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK

Dated: June 24, 2013

OPINION AND ORDER

FEUERSTEIN, J.

On July 3, 2012, pro se plaintiffs Thomas DeMartino ("Thomas") and Frank DeMartino ("Frank") (collectively, "plaintiffs") commenced this civil rights action pursuant to 42 U.S.C. § 1983 ("Section 1983") against defendants State of New York ("the State"), State of New York Commissioner of Taxation and Finance and "John Does #1-5" ("the Doe defendants"), identified only as employees of the State,¹ (Compl., ¶ 13), (collectively, "the State defendants"); the Townof Huntington ("the Town"); and the Internal Revenue Service ("IRS"), alleging violations of their constitutional rights. Pending before the Court are: (1) a motion by the IRS to dismiss the complaint as against it pursuant to Rule 12(b)(1) of the Federal Rules of Civil Procedure for lack of subject matter jurisdiction; and (2) a motion by the State defendants to dismiss the complaint pursuant to Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure for lack of subject matter jurisdiction and failure to state a claim for relief, respectively. For the reasons set forth below, the motions are granted.

I. Background²

A. Factual Background

In 2001, D&D Mason Contractors, Inc. (D&D), of which Thomas was the sole principal, commenced a lawsuit in the Supreme Court of the State of New York, County of Suffolk against the Town alleging breach of contract regarding a project known as "Sidewalk Improvements and Requirements Contract, Main Street, Huntington-Phase I" ("the breach of contract action"). (Compl., ¶ 14). Plaintiffs allege that in response to the breach of contract action, Richard Dickstein ("Dickstein"), the Town's project manager, indicated that the Town "would use their political connections to 'destroy' D&D * * * Thomas * * * and anybody else that was involved with litigation against the Town * * *." (Compl., ¶ 15).

On or about May 28, 2004, a desk appearance ticket was issued charging Thomas withone (1) count of offering a false instrument for filing in the first degree in violation of Section 175.35 of the New York State Penal Law in relation to his filing of written complaints with the New York State Department of Environmental Conservation ("DEC") alleging that the Town knowingly buried fuel tanks in the sidewalks on Main Street without undertaking the appropriate remedial measures provided by the law. (Compl., ¶ 16). Specifically, Thomas was charged with filing a "Supporting Deposition" purportedly executed by Ivano Valenti ("Valenti") on or about August 23, 2001, with the knowledge that the instrument was false and that it would be filed, and become a record of a public office, and with the intent that it would defraud the DEC. (Compl., ¶ 17). The criminal charge was dismissed against DeMartino pursuant to Section 30.30(1)(a) of the New York Criminal Procedure Law due to a speedy trial violation. (Compl., ¶ 20). Plaintiffs allege that the criminal prosecution "was in bad faith and part of a campaign and pattern of harassment against D&D * * * Thomas * * *, and others associated with D&D * * *." (Compl, ¶ 21).

In 2003 or 2004, the New York State Department of Labor ("DOL") initiated administrative proceedings against D&D, Thomas "and others for alleged violations of the prevailing wage laws." (Compl., ¶ 22). Plaintiffs allege that "[t]he baseless administrative proceedings resulted in an order and determination, dated April 7th, 2005, and filed April 8th, 2005, that was obtained by way of default, i.e., respondents were not present at the hearing to defend the allegations." (Compl., ¶ 23). D&D and Thomas subsequently filed an Article 78 petition in the Supreme Court of the State of New York, Appellate Division, Second Judicial Department ("the Appellate Division"), seeking to annul, vacate and set aside the April 2005 order. (Compl., ¶ 24). Valenti and another witness, DiBenedetto, both of whom had participated in the default hearing, submitted sworn affidavits as part of the Article 78 petition whichcontradicted their testimony at the hearing. (Compl., ¶ 25). Pursuant to a stipulation of settlement, the April 2005 order against D&D, Thomas and others was annulled, vacated and set aside. (Compl., ¶ 24). Plaintiffs contend that the DOL administrative proceedings "were asserted in bad faith and part of campaign and pattern of harassment against D&D * * *, Thomas * * *, and others." (Compl., ¶ 26).

On or about January 3, 2007, D&D obtained a judgment against the Town in the breach of contract action. (Compl., ¶ 27). D&D subsequently sold the judgment to DeMartino Property Management, Inc., which is owned and controlled by Frank. (Compl., ¶ 34). Thereafter, the judgment was assigned to Frank personally and he sold a fifty percent (50%) share in the judgment to Thomas personally. (Compl., ¶ 35).

"[I]n the latter portion of 2007 and continu[ing] to 2008," the State commenced additional administrative proceedings against Thomas alleging prevailing wage violations ("the 2007-2008 administrative proceedings"). (Compl., ¶ 29). According to plaintiffs, the State "moved forwarded [sic] with these administrative proceedings because they knew that they can succeed in sustaining the administrative charges in a forum they controlled, i.e., a kangaroo court, at the same time aiding the Town * * *, in intimidating, exacting revenge, gaining an advantage in the litigation between D&D and the Town * * * whereby the Town * * * would and could evade its legal obligations and avoid paying the money judgment obtained against it with all of the accrued interest." (Compl., ¶ 30). The State "succeeded in nearly all of the administrative charges asserted against * * * D&D * * * and Thomas * * * [and] received a significant money award accruing at a high interest rate, a civil penalty, and findings that D&D * * * and Thomas * * * knowingly and willingly committed prevailing wage violations * * * [which] caused [D&D and Thomas] to be debarred from public works contracts for a period of atleast five years." (Compl., ¶ 31). According to plaintiffs, "[t]he administrative proceedings were a complete mockery of the judicial process and the United States Constitution," (Compl., ¶ 32), and the State "obtained relief in the administrative proceedings by violating the constitutional [sic] protected rights of the parties." (Compl., ¶ 33). D&D's and Thomas's subsequent Article 78 petition relating to the 2007-2008 administrative proceedings was denied by the Appellate Division and the New York State Court of Appeals denied their application for leave to appeal to that Court. (Id.) According to plaintiffs, their collection of the judgment against the Town "has been frustrated by the [State's] bad faith administrative attack on [D&D and Thomas]" and the Town "has illegally withheld and avoided paying the judgment against it plus all of the accrued interest with the help of the State * * *." (Compl., ¶ 36).

Plaintiffs further allege that they are both indebted to the IRS and the New York State Department of Taxation and Finance ("DTF"). (Compl., ¶ 37). According to plaintiffs, "[w]hile the State * * * on one hand has frustrated [their] ability to collect money judgments due and owing, on the other hand the [DTF] has taken measures to enforce and collect taxes due and owing to the State. Nevertheless, the federal and state tax agencies have selectively elected not to pursue the money judgment, with all of the accrued interest, owed by the Town * * *. This double standard is clearly unconstitutional." (Compl., ¶ 37).

B. Procedural Background

On July 3, 2012, plaintiffs commenced this civil rights action pursuant to Section 1983 against the State defendants, the Town and the IRS alleging: (1) violations of their due process rights under the Fifth and Fourteenth Amendments to the United States Constitution (first and fifth causes of action against the State and Doe defendants and sixth cause of action against alldefendants); and (4) false arrest (fourth cause of action against the State, Town and Doe defendants). With respect to the, first cause of action, plaintiffs allege that the State defendants "made derogatory findings against Thomas * * * regarding falsification of payroll records charge [sic] without providing him written notice of these charges in advance of the hearing in violation of his constitutionally protected rights" and that "[a]s a direct result [of] these findings without due process of law, Thomas * * * suffered debarment from public works contracts for at least five years and a tangible burden on its [sic] future employment prospects." (Compl., ¶¶ 40-41). With respect to both their second and third causes of action, plaintiffs allege that the State defendants "vindictively and maliciously commenced the [2004 criminal] proceeding to retaliate against Thomas * * * for his breach of contract litigation with the Town * * *" in violation of his rights under the Fourth, Fifth and Fourteenth Amendments to the United States Constitution. (Compl., ¶¶ 47, 49, 54, 56). With respect to their fourth cause of action, plaintiffs allege that the Town and State defendants "conspired, instigated and played an active role in procuring [Thomas's] desk appearance [ticket] in 2004 as part of the campaign to harass him for his breach of contract litigation against the Town * * *" in violation of his rights under the Fourth, Fifth and Fourteenth Amendments to the United States Constitution. (Compl., ¶¶ 59, 64). With respect to their fifth cause of action, plaintiffs allege that the State defendants "made derogatory findings against Thomas * * * regarding prevailing wage violations without providing him the right to confront witnesses" when it failed...