Keady v. Nike, Inc.

• Citation: 116 F.Supp.2d 428
• Decision Date: 21 September 2000
• Docket Number: No. 99 CIV. 11460(AGS).,99 CIV. 11460(AGS).
• Parties: James KEADY, Plaintiff, v. NIKE, INC. and ST. John's University, Defendants.
• Court: U.S. District Court — Southern District of New York

116 F.Supp.2d 428

James KEADY, Plaintiff, v. NIKE, INC. and ST. John's University, Defendants.

No. 99 CIV. 11460(AGS).

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

September 21, 2000.

COPYRIGHT MATERIAL OMITTED

Jeffrey M. Harmatz, New York City, Joel D. Joseph, Washington, DC, for Plaintiff.

Raymond G. McGuire, Laura Sack, New York City, for St. Johns University.

Daniel Weisberg, Karen Solimando, New York City, for Nike, Inc.

OPINION AND ORDER

SCHWARTZ, District Judge.

In this action, plaintiff, a former employee of defendant St. John's University, alleges that defendants forced him to resign for refusing to wear athletic apparel bearing the Nike logo. Currently before the Court are defendants' motions to dismiss, and plaintiff's cross-motion for leave to amend his complaint. For the reasons set forth below, defendants' motions are granted and plaintiff's motion is denied.

I. Factual Background

Plaintiff James Keady is an individual residing in the State of New York. (Complaint for Declaratory, Injunctive, Compensatory and Punitive Damages ("Compl.") ¶ 2.) Defendant Nike, Inc. ("Nike") is a corporation organized under the laws of Oregon with its principal place of business in Oregon and offices in New York. (Id. ¶ 3.) Defendant St. John's University ("St. John's" or the "University") is a university located in Jamaica, New York, receiving state and federal funding that includes tax exemptions and grants. (Id. ¶ 4.)

During 1997 and 1998, plaintiff was a graduate student in theology at St. John's, enrolled in a master's program in pastoral theology with a concentration in social justice. (Id. ¶ 9.) On July 8, 1997, plaintiff and St. John's entered into an "Administrative Assistantship Agreement" (the "Agreement"), pursuant to which plaintiff (i) was engaged as an administrative assistant in the office of men's soccer in the athletics department, (ii) received $4,000 over the term of the agreement, and (iii) received a tuition waiver for up to 12 credit hours per semester for two semesters. (Id. ¶ 7, Ex. 1 ¶¶ 1, 4.) Pursuant to the Agreement, plaintiff agreed to perform his duties "diligently and cooperatively for approximately 20 hours a week," and render his services in a "scholarly and efficient manner." (Id., Ex. 1 ¶ 2.) The parties further agreed that the Agreement could be terminated by certain University officials "at any time" if, in their judgment, plaintiff "failed to perform any of the foregoing provisions of this Agreement." (Id., Ex. 1 ¶ 5.) The term of the agreement was from September 1, 1997 to May 15, 1998. (Id.)

As part of his graduate work, plaintiff wrote a research paper in which he considered whether Catholic universities should receive compensation from Nike because of the company's labor practices in Third World countries. (Id. ¶ 10.) The paper questioned Nike's alleged business practices, and the moral implications of St. John's business association with Nike on account of those practices. (Id. ¶ 11.) The paper also questioned an alleged "anti-defamation clause" in Nike's contracts with universities, which restricts the ability of coaches and administrators to be publicly critical of Nike. (Id.)

In February 1998, it became public that St. John's and Nike were negotiating a contract pursuant to which St. John's would require coaches and players to exclusively wear athletic apparel bearing the Nike logo in exchange for the provision of such apparel and certain funds to the University. (Id. ¶ 12; Memorandum of Law in Support of Defendant Nike, Inc.'s Motion to Dismiss at 1.) Plaintiff publicly opposed this contract. Specifically, he wrote an editorial in which he was critical of the contract, which, after being refused by a St. John's publication entitled St. John's Today, was published in the St. John's student newspaper entitled The Torch in February 1998. (Compl.¶¶ 13-14.) On February 10, 1998, prior to an interview with The Torch concerning plaintiff's editorial, plaintiff was purportedly told, by a person plaintiff does not identify, that he could not talk to the newspaper. (Id. ¶ 15.) He also received a business memo from David Masur ("Masur"), St. John's men's soccer coach, in which Masur (i) chides plaintiff for "publicly ridiculing St. John's University Athletic Department," (ii) recommends plaintiff assist another employee of the University "in her research concerning the Nike relationship," (iii) states that plaintiff should "support our programs and not utilize your energy in demonstrative fashions," (iv) asserts that there are people at the University "willing to work with you in fostering a unified relationship" with Nike, and (v) urges plaintiff to enhance St. John's "existing position with the proper diplomacy and channels of communication." (Id. ¶ 15, Ex. 2.)

Between February 1998 and plaintiff's eventual resignation from his post on June 24, 1998, plaintiff claims that he "was threatened with retaliation by university officials if he continued to refuse to wear Nike logo equipment and if he continued to speak out concerning the contract between [St. John's] and [Nike]." (Id. ¶ 16.) He also alleges that Nike "pressured [St. John's] to discredit [plaintiff] and take other steps to stop him from speaking against Nike and force him to wear Nike logo clothing or resign." (Id. ¶¶ 17-18.)

In early May 1998, plaintiff agreed to extend the Agreement and stay on as administrative assistant for another year. (Id. ¶ 19.) Nevertheless, plaintiff alleges that on May 12, 1998, Masur told him to "[w]ear Nike and drop the issue, or resign." (Id. ¶ 20.) On June 24, 1998, after the formalization of Nike's contract with St. John's discussed supra, plaintiff resigned. (Id. ¶¶ 21-22.) In his resignation letter, plaintiff stated inter alia that: (i) the reason for his resignation was "a troubling matter of conscience"; (ii) he felt that St. John's was "seriously compromising its mission statement and is in direct violation of Catholic Social teaching" through its relationship with Nike; (iii) acknowledged that Nike "has made some strides in addressing [ ] human rights violations ... but they have yet to address the issue of a living wage"; and (iv) stated that the payment of a "living wage" was his chief concern. (Id. ¶ 22, Ex. 3.) This action followed.

Plaintiff commenced this action on November 19, 1999, alleging that defendants forced him to resign for refusing to wear Nike athletic apparel. The Complaint asserts causes of action against both defendants alleging (i) violations of his civil rights under 42 U.S.C. §§ 1981, 1983, 1985, and 1986; (ii) criminal conspiracy against those rights under 18 U.S.C. § 241, and (iii) defamation. Plaintiff asserted separate causes of action against St. John's for (iv) employment discrimination under the New York State Human Rights Law and New York City Human Rights Law, and for (v) breach of contract.

St. John's subsequently moved to dismiss the Complaint against it in its entirety under Fed.R.Civ.P. 12(b)(1), 12(b)(6), and 12(c) ("Rules 12(b)(1), 12(b)(6) and 12(c)"), for lack of subject matter jurisdiction and failure to state a claim on which relief can be granted. Nike moved to dismiss all claims against it pursuant to Rule 12(b)(6). Both defendants subsequently filed answers to the Complaint.

II. Discussion

A. Legal Standard Governing Rule 12 Motions to Dismiss

In deciding a motion to dismiss, the Court must view the Complaint in the light most favorable to the plaintiff and accept the plaintiff's factual allegations as true. See Branham v. Meachum 77 F.3d 626, 628 (2d Cir.1996). The Court's function is not to weigh the evidence that might be presented at trial, but merely to determine whether the Complaint itself is legally sufficient. See Festa v. Local 3 Int'l Brotherhood of Electrical Workers, 905 F.2d 35, 37 (2d Cir.1990). Under Rule 12(b)(6) specifically, dismissal is inappropriate unless "it appears beyond doubt that the plaintiff can prove no set of facts in support of the claim which would entitle him to relief." Staron v. McDonald's Corp., 51 F.3d 353, 355 (2d Cir.1995) (quoting Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957)). In deciding a motion under Rule 12(b)(6), the court may consider "facts stated on the face of the complaint and in documents appended to the complaint or incorporated in the complaint, as well as [ ] matters of which judicial notice may be taken." Automated Salvage Transport, Inc. v. Wheelabrator Environmental Systems, Inc., 155 F.3d 59, 67 (2d Cir.1998).

II. Plaintiff's Civil Rights Claims

A. Section 1983

In his first cause of action, plaintiff alleges that both defendants violated 42 U.S.C. § 1983 ("Section 1983") without alleging any specific denial of rights.¹ Section 1983 authorizes a party who has been deprived of a federal right under the color of state law to seek relief through "an action at law, suit in equity, or other proper proceeding for redress." See City of Monterey v. Del Monte Dunes at Monterey, Ltd., 526 U.S. 687, 707, 119 S.Ct. 1624, 143 L.Ed.2d 882 (1999). Because the Court finds that plaintiff has not and cannot establish that either defendant acted under color of state law, it dismisses his Section 1983 claim for lack of subject matter jurisdiction.

Under Section 1983, liability attaches only to those wrongdoers "who carry a badge of authority of a State and represent it in some capacity, whether they act in accordance with their authority or misuse it." Nat'l Collegiate Athletic Assoc. v. Tarkanian, 488 U.S. 179, 191, 109 S.Ct. 454, 102 L.Ed.2d 469 (1988) (quoting Monroe v. Pape, 365 U.S. 167, 172, 81 S.Ct. 473, 5 L.Ed.2d 492 (1961)). As the Supreme Court stated in United States v. Classic, 313 U.S. 299, 326, 61 S.Ct. 1031, 85 L.Ed. 1368 (1941), "[m]isuse of power, possessed by virtue of state law and made possible only because the wrongdoer is clothed with the authority of state law, is action taken `under color of state law." Moreover, "the...