S. Buffalo Dev., LLC v. PVS Chem. Sols., Inc.
| Docket Number | 21-CV-1184S |
| Decision Date | 30 May 2023 |
| Citation | 675 F.Supp.3d 320 |
| Parties | SOUTH BUFFALO DEVELOPMENT, LLC, Plaintiff, v. PVS CHEMICAL SOLUTIONS, INC., and Norfolk Southern Railroad Company, Defendants |
| Court | U.S. District Court — Western District of New York |
Gregory P. Photiadis, Matthew J. Beck, Robert C. Carbone, Duke, Holzman, Photiadis & Gresens, LLP, Buffalo, NY, for Plaintiff.
David L. Roach, James Michael Lennon, Roach Lennon & Brown, PLLC, Buffalo, NY, for Defendant PVS Chemical Solutions, Inc.
John J. Jablonski, Gerber Ciano Kelly Brady, LLP, Buffalo, NY, for Defendant Norfolk Southern Railroad Company.
DECISION AND ORDER
Before this Court are Plaintiff South Buffalo Development's objections to a Report and Recommendation of the Hon. Jeremiah J. McCarthy, United States Magistrate Judge, wherein Judge McCarthy recommends that this Court deny Plaintiff's motion to amend its complaint. With briefing complete and oral argument unnecessary, this Court will accept in part and set aside in part the Report and Recommendation, grant in part and deny in part the objections, and grant Plaintiff leave to amend its complaint to add a private nuisance cause of action.
Plaintiff South Buffalo Development, LLC, ("SBD") is a real estate development entity that owns multiple properties in Buffalo, New York. Defendant PVS Chemical Solutions, Inc., ("PVS") is the owner of a property at 55 Lee Street that directly borders Plaintiff's properties. SBD commenced this action in New York State Supreme Court alleging a single cause of action against PVS related to PVS's use of a rail spur situated on one of Plaintiff's properties. Plaintiff then filed an amended complaint adding Norfolk Southern Railroad as a defendant. After Norfolk Southern removed this action to federal court, Plaintiff moved to amend its complaint to add causes of action for private nuisance and negligence against PVS.
In its proposed Second Amended Complaint ("SAC"), SBD adds nine properties to the one named in its original complaint. (Docket No. 23-3, ¶ 3.) It alleges that PVS's property is located immediately southwest of SBD's properties. (Id., ¶ 20.) According to SBD, PVS "exhausts sulfur dioxide and other by products of its production processes to the ambient air outside [PVS's] facility." (Id., ¶¶ 23-28.) Such emissions allegedly violate national air quality standards, and New York's Department of Environmental Conservation has commenced an enforcement action against PVS regarding these emissions. SBD further alleges that, "in addition to the toxic release of sulfur dioxide, PVS Chemical repeatedly causes gases to be released from its plant that permeate the Properties with a pungent rotten egg odor." (Id., ¶¶ 30-32.) SBD alleges that PVS's emissions have forced SBD and its tenant to cease regular use of SBD's properties, and that the "pervasive foul and offensive odors" interfere with the use and enjoyment of SBD's properties and have caused SBD to incur damages. (Id., ¶ 51.)
PVS opposed SBD's motion to amend. Norfolk Southern took no position. On February 10, 2023, Judge McCarthy issued a Report and Recommendation recommending that SBD's motion to amend be denied in its entirety because both proposed amendments were futile. (Docket No. 31.) SBD timely objected, and its objections are now before this Court.
In his Report and Recommendation, Judge McCarthy found that amendment would be futile because the proposed SAC did not state a claim for either private nuisance or negligence under New York law. SBD argues that its proposed SAC does state a claim; PVS argues that it does not.
1. Legal Standard
The parties differ on what standard this Court should use in reviewing Judge McCarthy's Report and Recommendation. Plaintiff argues that its motion to amend was a dispositive motion, and this Court should therefore apply a de novo standard of review. Defendant argues that the motion was non-dispositive and that a clear error standard applies.
A district judge may designate a magistrate judge to consider any pretrial matter pending before the court. See 28 U.S.C. § 636 (b)(1). If the pretrial matter is dispositive of a party's claim or defense, the magistrate judge must enter a recommended disposition—commonly known as a report and recommendation—including proposed findings of fact, when appropriate. See Fed. R. Civ. P. 72 (b)(1). If the pretrial matter is not dispositive of a party's claim or defense, the magistrate judge may resolve it by issuing a written order. See Fed. R. Civ. P. 72 (a).
The distinction is important because it determines the subsequent standard of review: dispositive matters are reviewed de novo by the district judge; non-dispositive matters are subject to the lesser clearly-erroneous-or-contrary-to-law standard. See 28 U.S.C. § 636 (b)(1); Fed. R. Civ. P. 72 (a) (clearly-erroneous-or-contrary-to-law standard); Fed. R. Civ. P. 72 (b)(3) (de novo review).
Although the Second Circuit has referred to a motion to amend a complaint as a non-dispositive matter, it has not explicitly so decided. Covet & Mane, LLC v. Invisible Bead Extensions, LLC, No. 21CV7740JPCRWL, 2023 WL 2919554, at *1, n. 1 (S.D.N.Y. Mar. 23, 2023) (). Some courts have suggested that a magistrate judge's recommendation to deny a motion to amend a complaint should be treated as dispositive, while a recommendation to grant the same motion should be treated as non-dispositive. Covet & Mane, 2023 WL 2919554, at *1, n. 1 ().
This Court finds that Judge McCarthy proceeded appropriately in treating SBD's motion to amend as dispositive. Because denial of SBD's motion to amend would effectively preclude the two causes of action it seeks to add, the motion will be treated as dispositive, and this Court will review the Report and Recommendation de novo as required by Rule 72 (b).
Federal Rule of Civil Procedure 15 provides that a party may amend its pleading with the court's leave, and that the court should "freely give leave when justice so requires." FRCP 15 (a)(2). Leave to amend may be denied, however, if the amendment (1) has been delayed unduly, (2) is sought for dilatory purposes or is made in bad faith, (3) would unduly prejudice the opposing party, or (4) would be futile. Kim v. Kimm, 884 F.3d 98, 105 (2d Cir. 2018) (citing McCarthy v. Dun & Bradstreet Corp., 482 F.3d 184, 200 (2d Cir. 2007)) (citation omitted). A proposed amendment to a pleading would be futile if it could not withstand a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). Ballard v. Parkstone Energy, LLC, No. 06-CV-13099 (RWS), 2008 WL 4298572, at *3 (S.D.N.Y. Sept. 19, 2008).
Under the Rule 12(b)(6) standard, the court accepts as true the non-conclusory factual allegations in the pleading and draws all reasonable inferences in the pleader's favor. Wells Fargo Sec., LLC v. LJM Inv. Fund, L.P., No. 18 CV 2020-LTS-SLC, 2021 WL 1198931, at *4 (S.D.N.Y. Mar. 30, 2021) (citing Roth v. Jennings, 489 F.3d 499, 501 (2d Cir. 2007)). To survive a motion to dismiss, a pleading must plead "enough facts to state a claim to relief that is plausible on its face." Bell Atl. v. Twombly, 550 U.S. 544, 570, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2007). However, a "pleading that offers labels and conclusions or a formulaic recitation of elements of a cause of action will not do." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009) (internal quotation marks and citations omitted). To state a claim upon which relief can be granted, its factual allegations "must be enough to raise a right to relief above the speculative level." Twombly, 550 U.S. at 555, 127 S.Ct. 1955.
SBD seeks to amend its complaint to add a claim for private nuisance. It alleges that PVS's emissions onto its properties are interfering with its use and enjoyment of its land. PVS argues, agreeing with Judge McCarthy, that such amendment would be futile because it fails to state a claim.
"There are two types of nuisance actions in New York State, public nuisance and private nuisance." Hicksville Water Dist. v. Philips Elecs. N. Am. Corp., No. 2:17-CV-04442 (ADS)(ARL), 2018 WL 1542670, at *7 (E.D.N.Y. Mar. 29, 2018). "A public nuisance under New York law exists when there is a substantial interference with a public right." Johnson v. Bryco Arms, 304 F. Supp. 2d 383, 390 (E.D.N.Y. 2004). Harms that are experienced by the public at large are generally remedied, on behalf of the public, by state regulation and enforcement. Davies v. S.A. Dunn & Co., LLC, 200 A.D.3d 8, 156 N.Y.S.3d 457, 461 (2021), leave to appeal denied, 38 N.Y.3d 902, 165 N.Y.S.3d 483, 185 N.E.3d 1004 (2022) () (citing Copart Indus. v. Consolidated Edison Co. of N.Y., 41 N.Y.2d 564, 394 N.Y.S.2d 169, 362 N.E.2d 968, 971 (1977)). A private party can bring a public nuisance claim only if it is able to allege a "special injury" distinct from the harm suffered by the community at large. Janki Bai Sahu v. Union Carbide Corp., 528 F. App'x 96, 101 n.4 (2d Cir. 2013) (citing 532 Madison Ave. Gourmet Foods, Inc. v. Finlandia Ctr., Inc., 96 N.Y.2d...
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