Jarusauskaite v. Almod Diamonds, Ltd.
| Decision Date | 26 June 2020 |
| Docket Number | Index No. 154732/2019 |
| Citation | 2020 NY Slip Op 32114 (U) |
| Parties | RAIMONDA JARUSAUSKAITE, Plaintiff v. ALMOD DIAMONDS, LTD., MORRIS GAD, MARK SEGALL, LIOR YAHALOMI, HENRY FAYNE, DENNIS SUSKIND, and DAVID FRANKEL, Defendants |
| Court | New York Supreme Court |
DECISION AND ORDER
Plaintiff sues to recover damages for a hostile work environment, emotional distress, defamation, and other torts by her employer, defendant Almod Diamonds, Ltd.; one of its owners, defendant Gad, whom plaintiff refers to as both its Chief Operating Officer and its CEO; and members of its Board of Directors, defendants Segall, Yahalomi, Fayne, Suskind, and Frankel. Plaintiff alleges that Almod Diamonds and Gad intentionally harassed and threatened her so that she would quit her job at the Almod Diamonds store in Playa del Carmen, Mexico, and that the Board of Directors ignored the harassment and threats and failed to intervene on her behalf.
Plaintiff claims that Almod Diamonds is the corporate alter ego of Gad, who uses the corporation's funds for his personal interests and financial gain. In 2008, plaintiff was hired to be the general manager for the Almod Diamonds store in Playa del Carmen.
Defendants' alleged tortious conduct began in the spring of 2016, in Almod Diamonds' New York office, when Gad displayed a photograph of two nude women, one of whom he claimed was plaintiff, so as to shame and degrade her. In an e-mail dated January 9, 2017, to members of the management team in the United States and Mexico, Gad claimed that plaintiff was losing money for the corporation and had stolen from the Playa del Carmen store's construction budget, even though she actually had saved $120,000 from the construction budget.
Plaintiff alleges that in February 2017, after the Playa del Carmen store opened, Gad authorized unannounced audits of the store, and, after two surprise inspections uncovered no impropriety, he began re-hiring former discharged Almod Diamonds employees as "Brand Managers" to prevent the Playa del Carmen store from becoming profitable. Plaintiff further alleges that Gad interfered with her management of the store by controlling the Brand Managers' daily schedules, allowing the Brand Managersto miss shifts without reporting their unexcused absences as required by Mexican labor law, and causing shortages in staff coverage of the store as well as the violations of law.
On August 24, 2017, armed robbers entered the Almod Diamonds Playa del Carmen store, destroyed its jewelry showcases, and stole its merchandise. Plaintiff alleges that on October 31, 2017, Gad, using corporate funds, retained a law firm in Playa del Carmen to fabricate a reason to terminate her employment. In November 2017, the law firm submitted a report implying, based on her irregular behavior after the store's robbery, that she had orchestrated the robbery. Around the same time, Gad sent her threatening messages, which she forwarded to other Almod Diamonds personnel requesting their protection, including Almod Diamonds' head of security, its Playa del Carmen security director, its regional director, its general counsel, and Albert Gad and Donna Gad Hecht, Morris Gad's siblings who co-owned the corporation with their brother.
Plaintiff alleges that on January 2, 2018, when the Playa del Carmen store was in the process of permanently closing, the Brand Managers, following Morris Gad's instructions, staged a public protest because she would not let them work. This protest received media coverage, leading to social media poststhreatening plaintiff and her family. In response, plaintiff again requested protection from Almod Diamonds' general counsel. On or about January 12, 2018, Gad filed criminal charges against plaintiff for the robbery of the Almod Diamonds Playa del Carmen store. Plaintiff spent more than $30,000 defending herself against the criminal charges. As a condition to reimbursing plaintiff for her legal expenses, Albert Gad's attorney asked plaintiff to release Albert Gad and any entity in which he held an ownership or controlling interest, which included Almod Diamonds, from any liability. Plaintiff claims that she has incurred more than $60,000 in attorneys' fees and expenses to date because she refused to sign the release, and the criminal charge that Morris Gad filed against plaintiff in Mexico remains pending.
On February 13, 2018, Gad disseminated an e-mail to a dozen unidentified Almod Diamonds personnel, claiming that plaintiff ran away from the police rather than assisting in the police's investigation of the Almod Diamonds store's robbery. In response to escalating threats and lack of assistance from Almod Diamonds, plaintiff filed a complaint with the Mexican police against Gad, documenting his harassment of her. Plaintiff subsequently filed a second complaint with the Mexican police against Gad for his threats against her.
Plaintiff continued to request assistance from Almod Diamonds personnel, including its Human Resources Department, to no avail. On May 8, 2018, plaintiff e-mailed Almod Diamonds' general counsel, its regional director for Mexico, and Albert Gad and Donna Gad Hecht to request information about the pending criminal charge against her, but received no answer.
In January 2019, plaintiff and her attorney traveled to New York to complain directly to the Board of Directors about Morris Gad's actions. The Board of Directors hired an independent law firm to investigate his actions and prepare a report for the Board's review, but then refused to accept the completed report to avoid liability.
In determining defendants' motions to dismiss the complaint under C.P.L.R. § 3211(a)(7), the court must accept plaintiff's factual allegations as true, liberally construe them, and draw all reasonable inferences in her favor. JF Capital Advisors, LLC v. Lightstone Group, LLC, 25 N.Y.3d 759, 764 (2015); Miglino v. Bally Total Fitness of Greater N.Y., Inc., 20 N.Y.3d 342, 351 (2013); ABN AMRO Bank, N.V. v. MBIA Inc., 17 N.Y.3d 208, 227 (2011); Drug Policy Alliance v. New York City Tax Comm'n, 131 A.D.3d 815, 816 (1st Dep't 2015). The court will not give suchconsideration, however, to allegations that consist of only bare legal conclusions, Simkin v. Blank, 19 N.Y.3d 46, 52 (2012); David v. Hack, 97 A.D.3d 437, 438 (1st Dep't 2012), with which the complaint here is replete, or to its allegations of claims that are not legally cognizable. Instead, the court accepts as true only plaintiff's allegations of facts that set forth the elements of legally cognizable claims and from them draws all reasonable inferences in her favor. Dismissal is warranted if the complaint fails to allege facts that fit within any cognizable legal theory. Faison v. Lewis, 25 N.Y.3d 220, 224 (2015); ABM AMRO Bank, N.V. v. MBIA Inc., 17 N.Y.3d at 227; Lawrence v. Graubard Miller, 11 N.Y.3d 588, 595 (2008); Nonnon v. City of New York, 9 N.Y.3d 825, 827 (2007).
In determining a motion to dismiss claims based on expiration of the applicable statute of limitations under C.P.L.R. § 3211(a)(5), the court similarly accepts plaintiff's factual allegations draws all reasonable inferences in her favor. Norddeutsche Landesbank Girozentrale v. Tilton, 149 A.D.3d 152, 158 (1st Dep't 2017); Benn v. Benn, 82 A.D.3d 548, 548 (1st Dep't 2011). Defendants bear the initial burden to establish, based on the complaint's allegations, when plaintiff's claim accrued and that the time to sue has expired. MTGLO Invs., LP v. Wozencraft, 172 A.D.3d 644, 644-45 (1st Dep't 2019); Norddeutsche LandesbankGirozentrale v. Tilton, 149 A.D.3d at 158; Lebedev v. Blavatnik, 144 A.D.3d 24, 28 (1st Dep't 2016). The burden then shifts to plaintiff to raise a factual issue whether the claim is timely or the statute of limitations is tolled or inapplicable. MTGLQ Invs., LP v. Wozencraft, 172 A.D.3d at 644-45; Norddeutsche Landesbank Girozentrale v. Tilton, 149 A.D.3d at 158.
Against the Board of Directors defendants, plaintiff claims a hostile work environment, intentional infliction of emotional distress, failure to oversee and monitor Almod Diamonds' operations, and a prima facie tort. Although the Board of Directors move to dismiss the complaint against them based on lack of subject matter jurisdiction as well as failure to state a claim, C.P.L.R. § 3211(a)(2) and (7), the lack of subject matter jurisdiction is superfluous.
The Board of Directors insist that they may not be held liable for a hostile work environment because they joined Almod Diamonds in July 2018, five months after the last alleged harassment or threat to plaintiff. While this precise contention relies on facts outside the complaint, Aff. of David J. Eiseman, ¶ 3, the complaint does allege that Gad family members settled a lawsuit "in mid-2018," Eisman Aff. A ¶ 292, that required AlmodDiamonds to establish a Board of Directors with five members independent of the Gad family, id. ¶ 295, who are the Board of Directors defendants here. Id. ¶¶ 35-39. Plaintiff does not allege a hostile work environment after the Board of Directors joined the corporation in mid-2018, which is fatal to her claim. Santiago-Mendez v. City of New York, 136 A.D.3d 428, 429 (1st Dep't 2016).
To sustain a hostile work environment claim against officers of a corporate employer under the New York State Human Rights Law or New York City Human Rights Law, plaintiff must show that they created, encouraged, approved, condoned, or acquiesced in an objectively hostile or abusive workplace environment, which altered the conditions of her employment. N.Y. Exec. Law § 296(1); N.Y.C. Admin. Code § 8-107(1)(a) and (13)(b)(1); Zakrzewska v. New School, 14 N.Y.3d 469, 480-81 (2010); Forrest v. Jewish Guild for the Blind, 3 N.Y.3d 295,...
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