Fox v. Int'l Conference of Funeral Serv. Examining Bds.

• Decision Date: 17 March 2017
• Docket Number: No. 15–CV–3905 (KMK),15–CV–3905 (KMK)
• Citation: 242 F.Supp.3d 272
• Parties: Trent FOX, Plaintiff, v. The INTERNATIONAL CONFERENCE OF FUNERAL SERVICE EXAMINING BOARDS and Deborah H. Orecki in her individual and official capacity, Defendants.
• Court: U.S. District Court — Southern District of New York

242 F.Supp.3d 272

Trent FOX, Plaintiff,

v.The INTERNATIONAL CONFERENCE OF FUNERAL SERVICE EXAMINING BOARDS and Deborah H. Orecki in her individual and official capacity, Defendants.

No. 15–CV–3905 (KMK)

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

Signed March 17, 2017

Brian S. Sokoloff, Esq., Kaitlyn R. McKenna, Esq., Mark A. Radi, Esq., Sokoloff Stern LLP, Carle Place, NY, Counsel for Plaintiff.

David P. Zaslowsky, Esq., Jennifer Semko, Esq., Baker & McKenzie LLP, New York, NY, Washington, DC, Counsel for Defendants.

OPINION & ORDER

KENNETH M. KARAS, District Judge:

Plaintiff Trent Fox ("Plaintiff") filed this Action against Defendants Deborah Orecki ("Orecki") and the International Conference of Funeral Service Examining Boards (the "Conference," and collectively "Defendants"), alleging that Defendants breached a contract and violated his constitutional rights. (See generally Am. Compl. (Dkt. No. 25).) Plaintiff is also seeking certain declaratory relief, including a declaration that the Conference's copyrights are invalid and that certain provisions of a non-disclosure agreement are unconscionable. Before the Court are Defendants' Motions To Dismiss the Amended Complaint (the "Motions") pursuant to Federal Rule of Civil Procedure 12(b)(6). (Dkt. Nos. 35, 38.) The Conference is seeking to dismiss every cause of action except for Plaintiff's breach of contract claim (claim 5). Orecki is seeking the dismissal of all of the causes of action asserted against her. For the reasons explained herein, Orecki's Motion is denied as moot because Plaintiff has withdrawn all claims against her with prejudice, (see Dkt. No. 58), and the Conference's Motion is granted.

I. Background

A. Factual Background

The following facts are drawn from Plaintiff's Amended Complaint, and are taken as true for the purpose of resolving the Conference's Motion.

Plaintiff is a licensed funeral director and embalmer in New York. (Am. Compl. ¶ 68.) From October 2006 through April 2008, he attended the American Academy McAllister Institute of Funeral Service, Inc. ("AAMI"), (id. ¶ 70), which is an accredited educational institution that provides education and training to funeral service students, (id. ¶ 50). Its programs also include preparing students to take the National Board Exam ("NBE"), (id. ¶ 1), the exam students must pass to become licensed funeral directors and embalmers in New York and other states, (id. ¶¶ 23, 42). The NBE is created and administered by the Conference. (Id. ¶ 1.)

The Conference is a non-profit 501(c)(3) corporation organized under the laws of Indiana and comprised of all of the state funeral service regulatory agencies, including the New York State Department of Health Bureau of Funeral Directing (the "DOH"), and several Canadian funeral service regulatory boards. (Id. ¶¶ 11, 13.) Plaintiff alleges that the Conference is a "state actor and quasi-governmental body, whose purpose is to administer licensing examinations on behalf of, with the cooperation of, and under the direction of" New York State. (Id. ¶ 12.) Orecki is a former member of the Conference Board of Directors, serving as the "Director for District 1," which includes New York. (Id. ¶ 14.) She also was a "public official in the State of New York, serving as Director of [DOH]." (Id. )

The NBE is comprised of two sections, an arts section and a sciences section, and is administered at a testing center on a computer. (Id. ¶¶ 44, 77.) Plaintiff took the arts and sciences sections of the NBE on April 21, 2008, and re-took the arts section on May 23, 2008. (Id. ¶ 75.) Ultimately, he passed both sections and his scores were certified to the DOH. (Id. ¶¶ 76, 83.)

Plaintiff alleges that he entered into two different contracts with the Conference before taking the NBE. Plaintiff states that the first contract (the "Test–Taker Agreement") consists of an agreement whereby Plaintiff paid the Conference a fee in exchange for the Conference's promise to "fairly administer and grade the NBE" and certify his passing scores to the state regulatory agencies of his choosing. (Id. ¶ 187.) The second contract is a non-disclosure agreement (the "Non–Disclosure Agreement") to which Plaintiff assented "minutes before" taking the NBE. (Id. ¶ 77.) Plaintiff alleges that he was confronted by a prompt on the computer screen stating, in relevant part:

You are expressly prohibited from disclosing, publishing, reproducing, or transmitting this exam, in whole or in part, in any form or by any means, verbal or written, electronic or mechanical, for any purpose, without the prior express written permission of the [Conference].

[...]

By selecting the "Yes, I agree. " button, you signify that you have read, understand and agree to the terms of this agreement. If you do not agree to the terms of this agreement, select the "No, I do not agree. " button and see the test administrator. Please note that you will forfeit your exam fees and the session will end.

(Id. ¶¶ 199–200 (internal quotation marks omitted).) Another provision required Plaintiff to acknowledge that he had not been provided access to any examination questions in advance of the exam. (Id. ¶ 81.) Plaintiff was given "only three minutes" to review these terms but ultimately accepted them. (Id. ¶ 78.) He alleges that he did not fully understand the terms of the Non–Disclosure Agreement before accepting them and that the terms amounted to a contract of adhesion. (Id. )

In 2011, Plaintiff passed the state counterpart to the NBE and received a New York State funeral director and embalming license. (Id. ¶ 85.) Since that time he has served as a funeral director at a funeral home in New York. (Id. ¶ 84.) In October 2014, Plaintiff requested that the Conference send his NBE scores to the Missouri State Board of Embalmers & Funeral Directors (the "Missouri Licensing Board"), also a member of the Conference. (Id. ¶¶ 13, 88.) Like in New York, Missouri law requires that applicants pass the NBE before receiving a license. (Id. ¶ 42.) Plaintiff alleges that the Conference either declined to certify his scores to the Missouri Licensing Board, or notified it that his scores were invalidated. (Id. ¶ 90.) His application for a Missouri license remains pending. (Id. ¶ 91.)

On October 2, 2014, the Conference sent a letter to Plaintiff "requesting a response to allegations that the Conference had credible evidence of [Plaintiff's] participation in a security breach involving the harvesting and sharing of [NBE] items at [AAMI]." (Decl. of Dalene Paull in Supp. of the Conference's Mot. To Dismiss ("Paull Decl.") Ex. 4, at 1 ("October 2014 Letter") (Dkt. No. 37); see also Am. Compl. ¶ 92).)¹ It noted that "any requests for recognition of [Plaintiff's] previous NBE results ... [would] be placed on hold pending the resolution of the current allegations." (October 2014 Letter 1.) Attached to the letter were emails Plaintiff sent to various individuals discussing the NBE questions he encountered on the exams he took. (See id. at 3–5.)² The security breach referenced in the letter related to a lawsuit the Conference brought against AAMI, alleging that AAMI induced students to improperly share confidential details regarding the NBE, including their recollection of exam questions, and then disseminating those questions to other students. (Am. Compl. ¶ 53.) The suit was settled in December 2014. (Id. ) Plaintiff alleges that the Conference was dissatisfied with the settlement and "decided to arbitrarily and capriciously retroactively punish AAMI students." (Id. ¶ 54.) In furtherance of this campaign, the Conference "developed a policy and practice of summarily retroactively invalidating the passing scores of numerous students who had contact with AAMI ... faculty ... either before or after they took the exam." (Id. ¶ 56 (internal quotation marks omitted).)

Following a series of communications spurred on by the October 2014 Letter, (id. ¶ 96–100), the Conference notified Plaintiff that "based upon available evidence and a directive of the Conference Board of Directors (BOD) it has been determined that [Plaintiff] provided items recalled from the NBE back to AAMI personnel after his test administration," (id. ¶ 101 (alterations and internal quotation marks omitted) ). Thereafter, the Conference imposed several sanctions. It invalidated Plaintiff's NBE scores, barred him from retaking the NBE for five years, fined him $500, and "threatened that any score transfers to state licensing boards would be accompanied with a notice that the scores had been invalidated." (Id. ¶ 102.) Plaintiff alleges that the Conference failed to conduct a good-faith investigation before imposing these sanctions and did not provide any notice that these sanctions were possible or provide an opportunity to respond. (Id. ¶ 105–06.) He states that he did not "disclose any trade secrets, copyrighted, copyrightable, or otherwise protected, confidential, or privileged information about the NBE." (Id. ¶ 103.)

Plaintiff alleges that the Conference has been delegated a public function by New York State because it engages in the "state function of creating and administering the exams the state requires for state licensure, creating criteria for licensing (by deciding when individuals can take the NBE), and imposing punishments on both licensees and license applicants." (Id. ¶ 135.) The Conference is allegedly a state actor because only government regulators are members, New York pays dues to the Conference, New York officials attend Conference meetings, New York uses taxpayer funds so that officials can attend Conference meetings, and the DOH participates in the election of the Conference Board of Directors. (Id. ¶¶ 118–24.) According to Plaintiff, without state participation the Conference would not exist. (Id. ¶ 125.) In other words:

The Conference is an organization exclusively composed of current state regulators required by state law to (1) examine funeral director and embalming license applicants, and (2)

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