Dynamic Worldwide Logistics, Inc. v. Exclusive Expressions, LLC

• Decision Date: 06 January 2015
• Docket Number: No. 14 Civ. 1370ER.,14 Civ. 1370ER.
• Citation: 77 F.Supp.3d 364
• Parties: DYNAMIC WORLDWIDE LOGISTICS, INC., Plaintiff, v. EXCLUSIVE EXPRESSIONS, LLC, David Saad and Joseph Saad, Defendants.
• Court: U.S. District Court — Southern District of New York

77 F.Supp.3d 364

DYNAMIC WORLDWIDE LOGISTICS, INC., Plaintiff

v.EXCLUSIVE EXPRESSIONS, LLC, David Saad and Joseph Saad, Defendants.

No. 14 Civ. 1370ER.

United States District Court, S.D. New York.

Signed Jan. 6, 2015.

Sandra Gale Behrle, Law Offices of Sandra Gale Behrle, New York, NY, for Plaintiff.

Mark L. McKew, The Law Office of Mark McKew, PLLC, New York, NY, for Defendants.

OPINION AND ORDER

RAMOS, District Judge.

Dynamic Worldwide Logistics, Inc. (“Dynamic” or “Plaintiff”) brings suit against Exclusive Expressions, LLC (“Exclusive”), David Saad, and Joseph Saad (together with Dynamic, “Defendants”) for conversion and breach of contract. See Compl., Doc. 2. The parties entered into a contract in which Dynamic promised to arrange for the transportation of leather goods from China to the United States.Id. at ¶ 7. The present dispute centers on Defendants' failure to tender the corresponding bills of lading following delivery of the items to Defendants in New York City. Id. at ¶¶ 18, 23. Defendants moved to dismiss the Complaint pursuant to Rule 12(c) of the Federal Rules of Civil Procedure. See Defs.' Mem. L. Support Mot. Dismiss, Doc. 19. For the reasons set forth below, Defendants' motion is GRANTED.

I. Background¹

Dynamic is a New Jersey-based non-vessel-operating common carrier (“NVOCC”) that provides transportation services between Asia and the United States. Compl. at ¶ 1. Exclusive, a New York Limited Liability Company, imports goods from China. Id. at ¶ 2. David and Joseph Saad are alleged to be either members or managers of Exclusive who currently reside in New York. Id. at ¶ 3–4.

Dynamic claims that it contracted with Exclusive to arrange for the transportation of handbags, wallets, and evening bags from China to New York City. Id. at ¶¶ 7, 8–9. In 2012–the only date specified in the entire Complaint–Dynamic allegedly issued a total of eight negotiable bills of lading, which designated Exclusive as the consignee.² Id. at ¶¶ 8–9. One set of shipments originated from the Chinese city of Yantian; the second set came from Shanghai. Id. Beyond that, the Complaint is devoid of facts ordinarily relevant to disputes involving the maritime transportation of goods. For example, the Complaint does not cite a single term contained in the bills nor identifies the parties bound thereto. Moreover, it does not identify the shipper or consignor, or name the notify party.³

Without establishing the source of Exclusive's obligation or reciting any contractual provisions, Plaintiff claims that Exclusive was required to provide Dynamic with the original bills of lading in order to receive delivery of the shipments. Id. at ¶ 10. Despite this alleged requirement, however, a Dynamic employee, who was not identified in the Complaint, authorized the delivery of the shipments to Exclusive without collecting the bills of lading. Id. at 11. The employee did so relying on a purported promise from an employee at Exclusive, who was also not identified in the Complaint, that it would surrender the bills of lading to Dynamic at some future point in time. Id. The Complaint fails to indicate when the promise was made and where the goods were at that point in time. Plaintiff states that it has repeatedly demanded the original bills of lading from Exclusive to no avail. Id. at ¶ 12. Yet, the number, dates, and method of these requests are not specified in the Complaint, nor are the individuals by whom and to whom the requests were made. Consequently, Plaintiff argues that Exclusive wrongfully converted the goods and breached an unspecified contract with Dynamic, all under the “direction and guidance” of David and Joseph Saad. Id. at ¶¶ 16–23.

Nowhere in the Complaint does Plaintiff allege that it owned, possessed or controlled the goods delivered to Defendants. Although it fails to describe any specific harm it has suffered, Dynamic seeks damages in excess of $374,154 for the conversion of property and breach of contract, along with costs and attorney fees. Id. at ¶ 23.

II. Discussion

A. 12(c) Motion to Dismiss Standard

Rule 12(c) provides that “[a]fter the pleadings are closed—but early enough not to delay trial—a party may move for judgment on the pleadings.” Fed.R.Civ.P. 12(c). The Court applies the same standard of review to a Rule 12(c) motion as it does to a motion to dismiss for failure to state a claim upon which relief can be granted under Rule 12(b)(6). Cleveland v. Caplaw Enters., 448 F.3d 518, 521 (2d Cir.2006).

When ruling on a motion to dismiss pursuant to Rule 12(b)(6), the Court must accept all factual allegations in the complaint as true and draw all reasonable inferences in the plaintiff's favor. Koch v. Christie's Int'l PLC, 699 F.3d 141, 145 (2d Cir.2012). However, the Court is not required to credit “mere conclusory statements” or “threadbare recitals of the elements of a cause of action.” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) ); see also id. at 681, 129 S.Ct. 1937 (citing Twombly, 550 U.S. at 551, 127 S.Ct. 1955 ). “To survive a motion to dismiss, a complaint must contain sufficient factual matter ... to ‘state a claim to relief that is plausible on its face.’ ” Id. at 678, 129 S.Ct. 1937 (quoting Twombly, 550 U.S. at 570, 127 S.Ct. 1955 ). A claim is facially plausible “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. (citing Twombly, 550 U.S. at 556, 127 S.Ct. 1955 ). More specifically, the plaintiff must allege sufficient facts to show “more than a sheer possibility that a defendant has acted unlawfully.” Id. Federal Rule of Civil Procedure 8 “marks a notable and generous departure from the hyper-technical, code-pleading regime of a prior era, but it does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions.” Id. at 678–79, 129 S.Ct. 1937. If the plaintiff has not “nudged [his] claims across the line from conceivable to plausible, [the] complaint must be dismissed.” Twombly, 550 U.S. at 570, 127 S.Ct. 1955.

B. Conversion

i. Federal Admiralty Jurisdiction

Whether a tort falls within the admiralty jurisdiction of the federal courts traditionally depends on the locality of the wrong.

Executive Jet Aviation, Inc. v. City of Cleveland, Ohio, 409 U.S. 249, 253, 93 S.Ct. 493, 34 L.Ed.2d 454 (1972). “If the wrong occurred on navigable waters, the action is within admiralty jurisdiction; if the wrong occurred on land, it is not.”⁴ Id. Specifically, the federal maritime tort of conversion requires a party to plead that a defendant “appropriated the property in question for its own use or gain and that the wrongful act occurred on navigable waters.” Gowanus Indus. Park v. Arthur H. Sulzer Associates, No. 06 Civ. 105(KAM)(JO), 2014 WL 4370643, at *5 (E.D.N.Y. July 22, 2014)report and recommendation adopted sub nom. Gowanus Indus. Park, Inc. v. Arthur H. Sulzer Associates, Inc., No. 06 Civ. 105(KAM) (JO), 2014 WL 4370722 (E.D.N.Y. Sept. 2, 2014) (internal citation omitted). In its opposition papers, Plaintiff declares that “federal maritime law clearly governs the shipments at issue” in its conversion claim. Pl.'s Mem. L. Opp. Mot. Dismiss, Doc. 20 at 6.

Based on the bare-bones allegations in the Complaint, admiralty jurisdiction is anything but clear. Plaintiff claims that Exclusive converted the goods by taking possession of them without surrendering the bills of lading. Compl. at ¶ 13. As the designated consignee, Exclusive presumably could have only accepted delivery of the goods after the shipments arrived in New York. See id. at ¶¶ 2, 8–9. Since a Dynamic employee concededly authorized the delivery to Exclusive, the initial possession was lawful and the alleged conversion must have occurred later. See id. at ¶ 11. Nothing in the Complaint suggests that the alleged tortious conduct occurred on navigable waters. Therefore, the Court may not exercise admiralty jurisdiction over Plaintiff's conversion claim. See Leather's Best, Inc. v. S.S. Mormaclynx, 451 F.2d 800, 808 (2d Cir.1971) (no admiralty jurisdiction for tort claims where purported negligence took place on land).

ii. Diversity Jurisdiction

Given that the Court has jurisdiction pursuant to 28 U.S.C. § 1332(a), it must also assess Plaintiff's conversion claim under the applicable state law.⁵ Conversion is defined under New York law as “any act of dominion wrongfully exerted over another's personal property in denial of or inconsistent with his rights therein.”⁶ Thypin Steel Co. v. Certain Bills of Lading Issued for Cargo of 3017 Metric Tons, More or Less, of Hot Rolled Steel Plate Laden on Bd. M/V Geroi Panfilovsky, No. 96 Civ. 2166(RPP), 1998 WL 912100, at *5 (S.D.N.Y. Dec. 30, 1998)aff'd in part, dismissed in part sub nom.

Thypin Steel Co. v. Asoma Corp., 215 F.3d 273 (2d Cir.2000) (citing G.D. Searle & Co. v. Medicore Commc'ns, Inc., 843 F.Supp. 895, 912 (S.D.N.Y.1994) ). To state a claim for conversion, a plaintiff must demonstrate that it has “legal ownership or an immediate possessory right superior to that of defendants' ” and that “the defendants exercised unauthorized dominion over the property to the exclusion” of the plaintiff's rights. Sea–Land Serv., Inc. v. Remington Rand Corp., No. 84 Civ. 177(LBS), 1986 WL 8862, at *5 (S.D.N.Y. Aug. 7, 1986)aff'd sub nom. Sealand Serv. Inc. v. Remington Rand Corp., 812 F.2d 713 (2d Cir.1987) (citing Gold Medal Products, Inc. v. Interstate Computer Servs., Inc., 80 A.D.2d 601, 600, 436 N.Y.S.2d 312, 313 (App.Div.1981) ).

Both parties have dedicated significant effort to debating whether Plaintiff has standing to bring a suit against Defendants given its status as an NVOCC.⁷ Defendants contend that Plaintiff has failed to allege that it had any right to ownership, possession, or control of the property it claims was converted. Doc. 19 at 6–7. Indeed,...