Vested Bus. Brokers, Ltd. v. Cnty. of Suffolk

• Decision Date: 15 September 2017
• Docket Number: 16-CV-4945 (JMA)(SIL)
• Parties: VESTED BUSINESS BROKERS, LTD, Plaintiff, v. COUNTY OF SUFFOLK, SUFFOLK COUNTY POLICE DEPARTMENT, DETECTIVE THOMAS GABRIELE (Shield # 1203), RICHARD DORMER, ALEXANDER J. CARO, KIERAN RODGERS, BRIDGE BUSINESS & PROPERTY BROKERS, INC., JOSEPH HOLSTEIN, ZYGMUND MARSZALEK, ARROW SECURITY, INC., JOHN AND JANE DOES 1-10 Defendants.
• Court: U.S. District Court — Eastern District of New York

VESTED BUSINESS BROKERS, LTD, Plaintiff, v. COUNTY OF SUFFOLK, SUFFOLK COUNTY POLICE DEPARTMENT, DETECTIVE THOMAS GABRIELE(Shield # 1203), RICHARD DORMER, ALEXANDER J. CARO, KIERAN RODGERS,BRIDGE BUSINESS & PROPERTY BROKERS, INC., JOSEPH HOLSTEIN,ZYGMUND MARSZALEK, ARROW SECURITY, INC., JOHN AND JANE DOES 1-10 Defendants.

16-CV-4945 (JMA)(SIL)

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK

September 15, 2017

MEMORANDUM AND ORDER

LOCKE, Magistrate Judge:

Presently before the Court are three motions to dismiss Plaintiff Vested Business Brokers, LTD's ("VBB" or "Plaintiff") Complaint ("Compl.") filed by: (1) Defendants Alexander J. Caro ("Caro"), Bridge Business & Property Brokers, Inc. ("Bridge"), and Arrow Security, Inc. ("Arrow"); (2) Zygmund Marszalek ("Marszalek") (collectively "Private Defendants"); and (3) the County of Suffolk ("Suffolk County"), the Suffolk County Police Department ("SCPD"), Detective Thomas Gabriele ("Det. Gabriele"), and Richard Dormer ("Dormer") (collectively "County Defendants").¹ Seemotion to dismiss ("Caro Motion"), Docket Entry ("DE") [31]; motion to dismiss ("Marszalek Motion"), DE [34], motion to dismiss ("County Motion"), DE [38]; see also Compl., DE [1]. On April 14, 2017, Judge Azrack referred these motions to this Court for a Report and Recommendation as to whether they should be granted. See DE [41]. On April 26, 2017, pursuant to 28 U.S.C. § 636(c), the parties filed an executed Notice, Consent, and Reference of a Civil Action to a Magistrate Judge, indicating their intention to have this Court "conduct all proceedings and order the entry of a final judgment" on the motions, which Judge Azrack So Ordered on the same date. See DE [41, 42]. For the reasons set forth herein, the motions to dismiss are granted in their entirety with prejudice.

I. STATEMENT OF RELEVANT FACTS

The following facts, set forth in the Complaint and the attached exhibits, are presumed true for purposes of Defendants' motions.

The gravamen of Plaintiff's claims are that, due to a conspiracy amongst the Private and County Defendants, the County Defendants failed to properly investigate and prosecute the Private Defendants for crimes committed against VBB. See Compl. ¶ 43. VBB is a web-based business designed to allow independent contractor-brokers to arrange the purchase and sale of other businesses. See id. ¶¶ 8, 21. Plaintiff allegedly created a proprietary system called "Broker Net" which contains more than 225,000 pre-qualified, registered business buyers as well as the financial details of approximately 12,000 businesses for sale. Id. ¶ 21. In order to safeguard financial details, VBB requires all of its employeesand independent brokers to execute non-disclosure and restrictive covenant agreements prior to receiving a password to enter the Broker Net system. Id. ¶ 24.

On or about January 16, 2004, VBB and Defendant Kieran Rodgers ("Rodgers") entered into an employment agreement and executed a non-disclosure and restrictive covenant agreement. Id. ¶ 25. Around the same time, Defendant Caro founded Bridge Business and Property Brokers, Inc. and "decided to build Bridge's business by stealing confidential information, including business listings, training information and other processes and procedures, and listing pitches and sales techniques from VBB." Id. ¶ 27. To that end, in 2006, Caro approached Rodgers and asked him to steal leads and other proprietary information from Plaintiff, and for a confidential VBB log-in username and password. Id. ¶¶ 29, 31. According to the Complaint, Defendants Joseph Holstein ("Holstein") and Marszalek, also worked with Caro and Rodgers to steal listings and other confidential information from VBB. See id. Sometime thereafter, Plaintiff allegedly confronted Rodgers about his conduct and he confessed. See id. ¶ 37. Subsequently, VBB filed complaints with, and turned over evidence to, the SCPD about the Private Defendants' alleged crimes. Id. ¶ 39. The SCPD, however, failed to make any arrests, and Plaintiff's complaint was closed in November 2015. Id. ¶ 42.

II. PROCEDURAL HISTORY

As set forth above, VBB filed its Complaint on September 5, 2016. See DE [1]. The Complaint seeks money damages and equitable relief for: 1) violations of theFourteenth Amendment of the U.S. Constitution made pursuant to 42 U.S.C. § 1983; 2) conspiracy claims made pursuant to 42 U.S.C. §§ 1985(3) and 1986; 3) breach of contract; 4) tortious interference with contract; 5) misappropriation; and 6) an injunction against Rodgers, Caro, and Bridge. See generally Compl. In response, on February 13^th, 16^th, and 17^th, 2017, Caro, Bridge, and Arrow, as well as Marszalek and the County Defendants, respectively, moved pursuant to Federal Rule of Civil Procedure ("Fed. R. Civ. P.") 12(b)(6) to dismiss. See DE [31, 34, 38]. On March 16, 2017, Judge Azrack referred the motions to this Court for Report and Recommendation. See DE [41]. On April 26, 2017, the motions to dismiss were referred to this Court to conduct all proceedings and enter a final order on the motions in accordance with 28 U.S.C. § 636(c). See DE [47].

III. LEGAL STANDARD

A. Fed. R. Civ. P. 12(b)(6)

To survive a motion to dismiss pursuant to Rule 12(b)(6), a complaint must set forth "enough facts to state a claim to relief that is plausible on its face." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S. Ct. 1955, 1974 (2007). "A claim has facial plausibility when the plaintiff pleads factual content that allows the Court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 1949 (2009). But, a pleading "that offers only 'labels and conclusions' or 'a formulaic recitation of the elements of a cause of action will not do.'" Id. (quoting Twombly, 550 U.S. at 555, 127 S. Ct. at1965). "Nor does a complaint suffice if it tenders 'naked assertion[s]' devoid of 'further factual enhancement.'" Id. (quoting Twombly, 550 U.S. at 557, 127 S. Ct. at 1966).

In reviewing a motion to dismiss, the Court must accept the factual allegations set forth in the complaint as true and draw all reasonable inferences in favor of the non-moving party. See LaFaro v. New York Cardiothoracic Grp., PLLC, 570 F.3d 471, 475 (2d Cir. 2009). Notwithstanding, "threadbare recitals of the elements of a cause of action" that are supported by "conclusory" statements and mere speculation are inadequate and subject to dismissal. See Chavis v. Chappius, 618 F.3d 162, 170 (2d Cir. 2010) (internal quotation and citation omitted).

In deciding a motion to dismiss pursuant to Fed. R. Civ. P. 12(b)(6), the court may consider:

(1) the factual allegations in the complaint, which are accepted as true; (2) documents attached to the complaint as an exhibit or incorporated . . . by reference; (3) matters of which judicial notice may be taken; and (4) documents upon whose terms and effect the complaint relies heavily, i.e., documents that are "integral" to the complaint.

Calcutti v. SBU, Inc., 273 F. Supp. 2d 488, 498 (S.D.N.Y. 2003) (internal citation omitted); see also Miotto v. Yonkers Pub. Sch., 534 F. Supp. 2d 422, 425 (S.D.N.Y. 2008) ("[I]n assessing the legal sufficiency of a claim, the court may consider only the facts alleged in the complaint, and any document attached as an exhibit to the complaint or incorporated in it by reference.").

IV. DISCUSSION

Applying the standards outlined above, and for the reasons set forth herein, the Court grants Defendants' respective motions to dismiss in their entirety with prejudice. Plaintiff asserts several federal causes of action made pursuant to 42 U.S.C. §§ 1983, 1985(3), and 1986 based upon alleged violations of its rights under the Equal Protection and Due Process Clauses of the Fourteenth Amendment to the United States Constitution. Initially, the Court considers the Private and County Defendants' argument that these claims are barred by the applicable statutes of limitations and, alternatively, fail to state a claim upon which relief can be granted. The Court then considers the remaining state law claims.

A. Conversion to a Motion for Summary Judgment

As a preliminary matter, the Court considers whether the affidavits annexed to the County Defendants' motion and Plaintiff's opposition papers converts that motion to one for summary judgment. On a 12(b)(6) motion, "[i]f matters outside the pleadings are presented to the court, a court may convert the motion to dismiss into a summary judgment motion." Vailette v. Lindsay, No. 11-CV-3610, 2014 WL 4101513, at *3 (E.D.N.Y. Aug. 18, 2014); see also Friedl v. City of N.Y., 210 F.3d 79, 83 (2d Cir. 2000) ("When matters outside the pleadings are presented in response to a 12(b)(6) motion, a district court must either exclude the additional material and decide the motion on the complaint alone or convert the motion to one for summary judgment under Fed. R. Civ. P. 56 and afford all parties the opportunity to present supporting material.") (internal quotation marks and alterations omitted). Althoughthe court "must ordinarily give notice to the parties" before conversion, "a party 'is deemed to have notice that a motion may be converted ... if that party should reasonably have recognized the possibility that such a conversion would occur.' " Almonte v. Pub. Storage Inc., No. 11 CIV. 1404, 2011 WL 3902997, at *1 (S.D.N.Y. Sept. 2, 2011) (quoting Sira v. Morton, 380 F.3d 57, 68 (2d Cir. 2004)); see also In re G. & A. Books, Inc., 770 F.2d 288, 295 (2d Cir. 1985) ("The essential inquiry is whether [the party] should reasonably have recognized the possibility that the motion might be converted into one for summary judgment or was taken by surprise and deprived of a reasonable opportunity to meet facts outside the pleadings.").

Whether to convert the motion is in the District Court's discretion. See Liberty Mut. Ins. Co. v. N. Picco & Sons Contracting Co., No. 05 CIV. 217, 2008 WL 190310, at *3 (S.D.N.Y. ...