Amended Complaint ¶¶ 31-41, and deems the continuing receipt of
compensation from LLL & M by Moskovitz, Schiller and Young to
constitute a pattern of racketeering activity. Id. ¶ 60.
A court should dismiss a claim under Federal Rule of Civil
Procedure 12(b)(6) when it appears that plaintiff can prove no
set of facts in support of his claim which would entitle him to
relief. Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99,
101-102, 2 L.Ed.2d 80 (1957); Philips Business Sys., Inc. v.
Executive Communications Sys., Inc., 744 F.2d 287 (2d Cir.
1984). For this purpose, the allegations of the complaint are
taken as true, Cruz v. Beto, 405 U.S. 319, 92 S.Ct. 1079, 31
L.Ed.2d 263 (1972), and examination is made whether those
allegations constitute a "short and plain" statement of a claim
showing that the pleader is entitled to relief. Fed.R.Civ.P.
8(a). See Wright & Miller, Federal Practice and Procedure:
Civil 2d § 1357. When examining the sufficiency of the
complaint under Rule 8(a), however, conclusory allegations
merely stating the general legal conclusions necessary to
prevail on the merits and which are unsupported by facts are
not taken as true. Packer v. Yampol, 630 F. Supp. 1237, 1241
(S.D.N.Y. 1986); M & M Transportation Co. v. U.S. Industries,
Inc., 416 F. Supp. 865, 869 n. 4 (S.D.N.Y. 1976). Examined in
this light, plaintiff's allegations constitute a claim not
cognizable under ERISA or are not sufficiently alleged to put
defendants on notice so that they can form a responsive
Section 510 of ERISA provides: "It shall be unlawful for any
person to discharge . . . a participant or beneficiary . . .
for the purpose of interfering with the attainment of any right
to which such participant may become entitled under [an
employee benefit plan]. . . ." 29 U.S.C. § 1140 (1982). Section
510 essentially prohibits employers from, inter alia,
"discharging . . . their employees in order to keep them from
obtaining vested pension rights." Dister v. Continental Group,
Inc., 859 F.2d 1108, 1111 (2d Cir. 1988) (quoting West v.
Butler, 621 F.2d 240, 245 (6th Cir. 1980)).
Plaintiff claims that her expulsion from the firm interfered
with her rights under ERISA by preventing her from continuing
to be enrolled in LLL & M's pension benefit and health and
medical plans.*fn2 However, plaintiff's claim that had she
remained as a partner, she would have accrued additional
benefits is not cognizable under § 510. Kelly v. Chase
Manhattan Bank, 717 F. Supp. 227, 232 (S.D.N.Y. 1989); Titsch v.
Reliance Group, Inc., 548 F. Supp. 983, 985 (S.D.N.Y. 1982),
aff'd mem., 742 F.2d 1441 (2d Cir. 1983) ("No ERISA cause of
action lies where the loss of pension benefits was a mere
consequence of, but not a motivating factor behind, a
termination of employment."). See also Gavalik v. Continental
Can Co., 812 F.2d 834, 851 (3d Cir.), cert. denied,
484 U.S. 979, 108 S.Ct. 495, 98 L.Ed.2d 492 (1987) ("Proof of incidental
loss of benefits as a result of a termination will not
constitute a violation of § 510.); Corum v. Farm Credit Svcs.,
628 F. Supp. 707, 718 (D.Minn. 1986) ("[P]laintiff must show
more than lost opportunity to accrue additional benefits,");
Baker v. Kaiser Aluminum & Chem. Corp., 608 F. Supp. 1315, 1319
(N.D.Cal. 1984) ("The only evidence offered by plaintiff is
that if he had not been terminated, he would have been able to
accrue additional benefits.").
Apart from this deprivation, there are no facts alleged to
allow the Court to find that plaintiff can prove any set of
facts in support of her claim. See Packer v. Yampol, 630
F. Supp. at 1241 ("Plaintiffs bear the burden of pleading facts
in support of each element of their 10b-5 claim, and they have
not pleaded facts constituting an injury.") (emphasis in
original). Her ERISA claims
in paragraphs 123 and 125 of the complaint are stated as a mere
conclusion of law. Her repetition and reallegation of
paragraphs 13 through 118 add nothing of substance to the
claim. The remaining allegations pertaining to this claim,
contained in paragraphs 126 through 128, merely request
particular relief. It cannot be said that these allegations
sufficiently put defendants on notice of their actions so that
they may form a responsive pleading. Accordingly, this claim is
dismissed pursuant to Fed.R.Civ.P. 12(b)(6). See Toomey v.
Wickwire Spencer Steel Co., 3 F.R.D. 243 (S.D.N.Y. 1942)
(dismissing complaint where it set forth a "hazy mass of
conclusions" without any plain statement of the facts upon
which the claim was based).
Section 1964(c) of the RICO statute authorizes a private
cause of action for "[a]ny person injured in his business or
property by reason of a violation of section 1962." 18 U.S.C. § 1964(c).
To state a claim for damages under section 1964(c),
a plaintiff must first allege a violation of the substantive
RICO statute, 18 U.S.C. § 1962(a)-(c). Under § 1962(a)-(c),
plaintiff must allege "(1) that the defendant (2) through the
commission of two or more acts (3) constituting a `pattern' (4)
of `racketeering activity' (5) directly or indirectly invests
in, maintains an interest in, or participates in (6) an
`enterprise' (7) the activities of which affect interstate or
foreign commerce." Moss v. Morgan Stanley, Inc., 719 F.2d 5, 17
(2d Cir. 1983), cert. denied, 465 U.S. 1025, 104 S.Ct. 1280, 79
L.Ed.2d 684 (1984).
The pattern requirement is a common thread in all three
sections of the criminal RICO statute:
(a) It shall be unlawful for any person who has
received any income derived, directly or
indirectly, from a pattern of racketeering
activity . . . to use or invest . . . any part of
such income, or the proceeds of such income, in
acquisition of any interest in . . . any
enterprise. . . .
(b) It shall be unlawful for any person through a
pattern of racketeering activity . . . to acquire
or maintain . . . any interest in or control of
any enterprise. . . .
(c) It shall be unlawful for any person employed
by or associated with any enterprise . . . to
conduct or participate . . . in the conduct of
such enterprise's affairs through a pattern of
racketeering activity. . . .
18 U.S.C. § 1962.
In Sedima, S.P.R.L. v. Imrex Co., 473 U.S. 479, 496 n. 14,
105 S.Ct. 3275, 3285 n. 14, 87 L.Ed.2d 346 (1985), the Supreme
Court indicated that two predicate acts may not be sufficient
to establish a pattern of racketeering activity within the
meaning of § 1962 where the "factor of continuity plus
relationship which combines to produce a pattern" is missing.
See also Beauford v. Helmsley, 865 F.2d 1386, 1391 (2d Cir.),
vacated and remanded, ___ U.S. ___, 109 S.Ct. 3236, 106 L.Ed.2d
584 (1989), reaffirmed, ___ U.S. ___, 110 S.Ct. 539, 107
L.Ed.2d 537 (1989); United States v. Indelicato, 865 F.2d 1370
(2d Cir. 1989).*fn3
A pattern is established for RICO purposes where the
predicate acts "themselves amount to, or . . . otherwise
constitute a threat of, continuing racketeering activity." H.J.
Inc. v. Northwestern Bell Telephone Co., ___ U.S. ___, 109
S.Ct. 2893, 2901, 106 L.Ed.2d 195 (1989) (emphasis in
original). The Supreme Court in H.J. Inc. explained that
predicate acts extending over a few weeks or months and
threatening no future criminal conduct do not satisfy the
pattern requirement. Id. 109 S.Ct. at 2902. In this case,
plaintiff alleges a single predicate transaction, i.e., that
the agreed upon compensation which LLL & M offered and
defendants Moskovitz, Schiller and Young accepted to breach
their partnership agreement and transfer certain client
accounts from their former firm to
LLL & M constituted commercial bribery. Plaintiff alleges no
facts from which a threat of continued bribery may rationally
be inferred. See Continental Realty Corp. v. J.C. Penney Co.,
729 F. Supp. 1452 (S.D.N.Y. 1990); USA Network v. Jones
Intercable, Inc., 729 F. Supp. 304, 318 (S.D.N.Y. 1990) (no
threat of continuity where alleged purpose of fraudulent scheme
was "essentially accomplished"); Airlines Reporting Corp. v.
Aero Voyagers, Inc., 721 F. Supp. 579, 584 (S.D.N.Y. 1989) (no
pattern of racketeering activity where complaint alleged "a
closed-ended, single scheme involving three perpetrators . . .,
one victim . . ., and an uncomplicated transaction. . . .") LLL
& M's continued payment of compensation to Moskovitz, Schiller
and Young will not transform a single alleged bribe into a
pattern for RICO purposes. See also Bingham v. Zolt,
683 F. Supp. 965, 970 (S.D.N.Y. 1988) (improper to "characteriz[e]
the defendant's subsequent enjoyment of the proceeds of the
scheme as continuous criminal activity,") (analyzing enterprise
Nor is there any showing that a threat of continuity exists
because the predicate acts are a regular way of conducting
defendant's ongoing legitimate business. H.J. Inc., 109 S.Ct.
at 2902. Plaintiff alleges no facts tending to show that LLL &
M makes a practice of subverting mainstay client accounts at
other firms by luring away the billing partners as a means of
increasing LLL & M's profitability or building its client base.
See Azurite Corp. v. Amster & Co., 730 F. Supp. 571, 581
(S.D.N.Y. 1990) (short-term, closed-ended scheme did not show
threat of continuity absent allegations that defendants had
committed the same or similar acts before or that they had
committed them again after the period in question); Continental
Realty, 729 F. Supp. at 1455 ("[T]here is no reason to believe
that Home Depot will continue to provide dummy bids for the
Defendants in other real estate transactions."). Accordingly,
plaintiff's RICO claims are dismissed in their entirety.
The only asserted bases for federal jurisdiction in this case
are plaintiff's RICO and ERISA claims. Amended Complaint ¶
9-10. Having found these claims deficient, the Court declines
to exercise pendent jurisdiction over the state claims, counts
three through fifteen, and these will be dismissed as well. See
United Mine Workers v. Gibbs, 383 U.S. 715, 726, 86 S.Ct. 1130,
1139, 16 L.Ed.2d 218 (1966); Chase Manhattan Bank, N.A. v.
Fidata Corp., 700 F. Supp. 1252, 1261 (S.D.N.Y. 1988).
In conclusion, the plaintiffs have failed to allege either an
ERISA or RICO violation in conformity with the governing
statutes, and defendant's motion to dismiss those claims is
therefore granted. Plaintiff's motion for injunctive relief is
denied. Because the state law claims are dismissed for lack of
jurisdiction, plaintiff's motion for summary judgment on those
claims is denied. Both parties' motions for sanctions under
Fed.R.Civ.P. 11 are denied.
It should also be noted that the Court does not appreciate
being served with six inches of papers which plaintiff's
counsel delivered to chambers on August 24, 1990, and
identified as an undocketed mandamus petition that he would be
forced to file if the Court did not act in this case prior to
August 29, 1990. The Court has advised counsel at earlier
appearances that his marital relationship with plaintiff was
bound to blind his professional judgment. The Court finds
counsel's conduct unbecoming a member of the bar of this Court.
If counsel wished to file a petition for mandamus, he should so
file it. Plaintiff's counsel has advised the Court that he
supplied the mandamus petition on the advice of a Legal
Coordinator on the staff of the Second Circuit and that such a
procedure was intended to be a courtesy to this Court. The
Court accepts this explanation of counsel's intention but
disapproves of the procedure followed.