Wharton v. Duke Realty, Llp

• Decision Date: 22 December 2006
• Docket Number: No. 06 CIV. 6937(CM).,06 CIV. 6937(CM).
• Citation: 467 F.Supp.2d 381
• Parties: Deanna WHARTON, Plaintiff, v. DUKE REALTY, LLP and Theodore Furst In his Individual and Corporate Capacities Defendants.
• Court: U.S. District Court — Southern District of New York

467 F.Supp.2d 381

Deanna WHARTON, Plaintiff, v. DUKE REALTY, LLP and Theodore Furst In his Individual and Corporate Capacities Defendants.

No. 06 CIV. 6937(CM).

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

December 22, 2006.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Alan B. Pearl, Alan B. Pearl & Associates, P.C., Syosset, NY, for Plaintiff.

Susan Meryl Corcoran, Jackson Lewis LLP, White Plains, NY, for Defendants.

MEMORANDUM AND ORDER GRANTING DEFENDANTS' MOTION TO DISMISS

MCMAHON, District Judge.

Plaintiff Deanne Wharton, a former employee of defendant Duke Realty, brings the current action seeking relief under the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1101 et. Seq.. She alleges that defendants violated Section 510 of ERISA, 29 U.S.C. § 1140, by firing her in order to interfere with her protected rights under ERISA and contesting her right to unemployment insurance benefits in retaliation for her exercise of those rights. In addition to her claim for damages, she seeks to recover benefits under Section 502 of ERISA, 29 U.S.C. § 1132. In connection with her termination by defendants, plaintiff also asserts state law claims for breach of contract and for age discrimination in violation of the New York State Human Rights Law, N.Y. Executive Law 296.

Facts

The complaint pleads the following facts: Plaintiff was hired by defendants in or around July 1980 to work two days a week as a bookkeeper. Over the course of her twenty-six year employment with defendants, plaintiff's job responsibilities expanded significantly; at the time of her termination her title was Financial Administrator and her salary was $60,000 per year. During the last five years of her employment, plaintiff was responsible for all of Duke's financial transactions, including, inter alia, payroll accounting, payment tax reports, pension plan accounting, administration of pension and medical plans, accounts payable, accounts receivable, and banking.

Plaintiff pleads that Duke maintained a qualified pension and retirement plan as defined at 29 U.S.C. § 1002(2A) of ERISA, and that Duke was the plan sponsor of that plan.

In 1997, defendants and plaintiff entered into an agreement. The complaint alleges that the agreement provides that Duke would contribute money representing 25% of plaintiff's salary into Duke's pension and retirement plan, a qualified 401K plan, for the purpose of providing plaintiff with retirement benefits. The agreement, denominated the 1997 Benefits Agreement, is attached to the motion to dismiss. It provides that plaintiff would receive "additional compensation annually from Duke Management (or its related companies) while she is in their employ" if "Duke Millwork discontinues its profit sharing retirement plan for any reason." The amount of the additional compensation under the agreement is to be "calculated at the same percentage of salary (25%) as that which will be used for her profit sharing retirement contribution in 1997." The agreement further provides that if Duke Millwork does not fund its profit sharing plan annually at the 1997 level (15% maximum contribution), plaintiff will receive the difference as additional compensation, and that profit sharing contributions and any additional compensation will be made annually until her retirement but not later than age 65. The agreement does not refer to any 401K plan or even, by its literal terms, require that Duke pay the money into such a plan, as opposed to simply giving the money to plaintiff to do with as she wished. However, the complaint alleges that the parties "operated under the 1997 Benefits Agreement for many years," Viewing that allegation most favorably to plaintiff, as I must on this motion to dismiss, it could be read to assert that Duke terminated the pension plan and, made contributions on plaintiff's behalf to the 401K, as alleged.

Throughout her employment, plaintiff and defendant Theodore Furst ("Furst") had a close working relationship. This relationship was allegedly undermined during the last three years of plaintiff's employment by Furst's wife, Dee Harriss, another Duke employee. On several occasions in 2003 and 2004, plaintiff was made to feel that her position with Duke was in danger.

In September 2005, plaintiff returned from vacation and was confronted by Furst, who falsely accused her of not being accessible during her vacation. The locks on plaintiff's office door and desk had also been changed. After meeting with the plaintiff, defendants did not terminate her. Instead, Furst told plaintiff that she deserved some job security, and the two jointly discussed and prepared an agreement (the "Employment Agreement") which provided that plaintiff would remain employed by the defendants for at least five years, during which time she would receive the same benefits, including the retirement and health insurance benefits, that she had been enjoying.

On January 24, 2006, the day before plaintiff was scheduled to leave on vacation, she was asked to resign her employment — no reason given — and to sign a release that offered her $20,000 for waiving all rights to contest her termination, as well as all her rights under the "1997 Benefits Agreement" and the Employment Agreement. Defendants also stated that if plaintiff signed the agreement, they would not contest her eligibility for unemployment insurance benefits. Plaintiff refused to resign her employment or sign the release.

On February 7, 2006, plaintiff returned from her vacation and was immediately fired. The decision to fire plaintiff was made by defendant Furst. Plaintiff was given no reason for her termination except for the statement by defendants' attorney, "You and Mr. Furst are going in different directions." She was offered the same release that was offered to her on January 24, 2006 and was told that she should sign it because that would "make it easy" on her. Plaintiff was told she had 45 days to review the document. She did not sign the release.

Defendants contested her eligibility for unemployment insurance benefits, as they had threatened to do when she refused to sign the release offered to her on January 24, 2006 and February 7, 2006. They falsely represented to the New York State Department of Labor's Unemployment Insurance Division that plaintiff was fired for misconduct. Although defendants initially prevailed, plaintiff appealed the denial of her unemployment benefits. On August 3, 2006, the Unemployment Insurance Appeal Board issued a decision for the plaintiff in which it found defendants' allegations of Plaintiff's misconduct to be baseless.

On September 11, 2006, plaintiff commenced this suit. Her complaint alleges five causes of action. In the first cause of action, plaintiff alleges that defendants violated Section 510 of ERISA by terminating her, at least in part, in order to interfere with her entitlement to health and pension benefits under the "1997 Benefits Agreement" and the Employment Agreement. In the second, she claims that defendants violated Section 510 by contesting her entitlement to unemployment insurance bene fits in retaliation for her refusal to sign a release of all rights to such health and pension benefits under the "1997 Benefits Agreement" and the Employment Agreement as well as the right to contest her termination. In her third cause of action, plaintiff seeks to recover benefits allegedly owed to her pursuant to Section 502(a)(1) of ERISA, 29 U.S.C. § 1132. Plaintiff's fourth cause of action alleges that defendants breached the Employment Agreement by terminating her prior to the expiration of the five-year term specified in the contract. Finally, Plaintiff's fifth cause of action alleges age discrimination in violation of the New York State Human Rights Law, N.Y. Executive Law 296.

Standard of Review on a Motion to Dismiss Pursuant to Rule 12(b)(6)

Rule 12(b)(6) of the Federal Rules of Civil Procedure provides for dismissal of a complaint that fails to state a claim upon which relief can be granted. The standard of review on a motion to dismiss is heavily weighted in favor of the plaintiff. "In ruling on a motion to dismiss for failure to state a claim upon which relief may be granted, the court is required to accept the material facts alleged in the complaint as true." Frasier v. General Electric Co., 930 F.2d 1004, 1007 (2d Cir.1991). The Court is also required to read a complaint generously, drawing all reasonable inferences from its allegations in favor of the plaintiff. California Motor Transport Co. v. Trucking Unlimited, 404 U.S. 508, 515, 92 S.Ct. 609, 30 L.Ed.2d 642 (1972). The Court must deny the motion "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Stewart v. Jackson & Nash, 976 F.2d 86, 87 (2d Cir.1992) (quoting Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957)). Additionally, the Rules do not require the claimant to set out in detail the facts upon which he or she bases a claim, but only that he or she gives a statement of his or her claim that will give defendant "fair notice of what [his or her] claim is and the grounds upon which it rests." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957).

In deciding a motion to dismiss, this Court may consider the full text of documents that are quoted in the complaint or documents that the plaintiff either possessed or knew about and relied upon in bringing the suit. Rothman v. Gregor, 220 F.3d 81, 88-89 (2d Cir.2000); San Leandro Emergency Med. Group Profit Sharing Plan v. Philip Morris Cos., 75 F.3d 801, 808 (2d Cir.1996); Wolff v. Rare Medium, Inc., 210 F.Supp.2d 490, 494 (S.D.N.Y.2002). Thee parties agree that both the "1997 Benefits Agreement" and the Employment Agreement are properly deemed part of the complaint for purposes of this motion. Tirone v. New York Stock Exchange, 2006 WL 2773862, 2006 U.S....