joint venture, the second for breach of fiduciary duty, the third for fraud arising out of a material misrepresentation, the fourth for unjust enrichment, the fifth for interference with a contract entered with Buxton BioMedical Inc. ("Buxton") alleged to have been entered into in the course of the joint venture. The remaining causes of action alleged claims based upon the violation of §§ 296 and 297 of the Executive Law of New York, a claim for incentive pay and damages for the failure to return personal property of Mrs. Rivkin on the occasion of her discharge.
Dr. Coleman filed the instant motion with supporting affidavits, and Mrs. Rivkin has submitted opposing affidavits and memoranda. The motion was argued and marked fully submitted on November 15, 1995.
The undisputed facts derived from Dr. Coleman's 3(g) statement, the complaint and the affidavits are that Dr. Coleman hired Mrs. Rivkin at a salary of $ 27,000 a year in August 1992 as an administrative assistant and office manager for his office, where he practiced plastic and reconstructive surgery. Mrs. Rivkin had been employed in a family business and at the time of hiring was a recent graduate of Mt. Holyoke College and had received an advanced degree in philosophy from Oxford University.
Dr. Coleman has developed a surgical technique which he has termed "lipoinfiltration" and "lipostructure." This technique transplants subcutaneous tissue within a patient's body, removing fat tissue from one part of a the body (e.g., the abdomen or buttock) and injecting it by means of a "cannula," a finely-measured syringe-like instrument, into other areas of the body. Dr. Coleman has a patent application pending for this technique and the cannula.
Part of the duties assigned to Mrs. Rivkin included an effort to locate a manufacturer to produce the cannula in accordance with Dr. Coleman's specifications. Dr. Coleman intended to teach others the technique and the use of the cannula.
Dr. Coleman retained Oleg Rivkin ("Mr. Rivkin"), an attorney and Mrs. Rivkin's husband, to perform various legal services in connection with the cannula project, including the patent application, as well as other matters. In March of 1995, Mr. Rivkin made a trademark application on Dr. Coleman's behalf as owner of the mark "lipostructure."
From July 1994 through August 1995, the effort to locate a manufacturer for the cannula was concentrated on Buxton Biomedical ("Buxton"), a manufacturer. Mrs. Rivkin conducted negotiations with Buxton personnel concerning the terms on which the product would be manufactured, and a prototype was developed. In June, 1995, these negotiations intensified, including consideration of the royalties to be paid by the manufacturer, and a proposal was made to Dr. Coleman based upon discussions with Mrs. Rivkin. Thereafter, the Buxton representative was told that another lawyer was representing Dr. Coleman, and a revised proposal was made by Buxton. On August 7, 1995, Dr. Coleman discharged Mrs. Rivkin.
Beyond these facts are serious areas of contention. According to Mrs. Rivkin, she and Dr. Coleman in November 1995, formed a joint venture to develop the cannula, the gross profits of which were to be divided 20% to her and 80% for him. Mrs. Rivkin contends that at the time of making this agreement Dr. Coleman falsely represented that he intended to perform the agreement. Dr. Coleman disputes the existence of the joint venture and denies making any false representations. It is undisputed that there is no writing codifying the venture.
Mrs. Rivkin claims the name for the techniques was coined by her, that Dr. Coleman fired her upon learning of her pregnancy, and that he failed to return personal property to her and failed to make incentive payments that had been agreed upon.
I. Standard for Summary Judgment
The instant motion is brought pursuant to Rule 56. The Rule 56 motion for summary judgment is "an integral part" of the Federal Rules of Civil Procedure and facilitates the overall purpose of the Rules as stated in Fed. R. Civ. P. 1: namely, "to secure the just, speedy and inexpensive determination of every action." Celotex Corp. v. Catrett, 477 U.S. 317, 327, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986). A motion for summary judgment may be granted only when there is no genuine issue of material fact remaining for trial and the moving party is entitled to judgment as a matter of law. See Fed. R. Civ. P. 56(c); Silver v. City Univ., 947 F.2d 1021, 1022 (2d Cir. 1991). If when "viewing the evidence produced in the light most favorable to the nonmovant . . . a rational trier could not find for the nonmovant, then there is no genuine issue of material fact and entry of summary judgment is appropriate." Binder v. Long Island Lighting Co., 933 F.2d 187, 191 (2d Cir. 1991).
II. The Statute of Frauds Bars The Joint Venture Causes of Action
While there is an undeniable issue of fact with respect to the existence of the joint venture agreement, there is no dispute that the agreement alleged by Mrs. Rivkin is oral and that it covered royalties resulting from the sale of the cannula. As such, it could not be performed within year. According to Mrs. Rivkin, the General Obligations Law § 701(1) does not cover joint ventures, and New York cases are cited for the proposition.
Fortunately this issue was resolved in the careful opinion of the Honorable William C. Conner in Halloran v. Ohlmeyer Communications Co., 618 F. Supp. 1214 (S.D.N.Y. 1985). His characteristically complete opinion can serve as the authority for granting the dismissal of the joint venture claims. There as here, there was a factual dispute as to the agreement to form a joint venture, and Judge Conner concluded what must be concluded here; namely, that the plaintiff has satisfactorily alleged that an agreement was reached, again leaving aside for the moment whether or not the allegations are sufficient to establish an agreement to share losses.
With the parties in the similar posture as the parties here, it was held in Halloran that the Statute of Frauds barred enforcement of the putative joint venture.
Having concluded that an issue of fact exists as to whether there was an agreement between the parties, I next address defendants' argument that even if there were such an agreement between the parties, it would be unenforceable under the New York statute of frauds. N.Y. Gen. Oblig. Law § 5-701(a)(1) (McKinney 1978),
since it was not capable of performance within a year. Defendants' Memorandum at 8-12. The parties differ on whether the New York statute of frauds applies to joint venture agreements, and each side has cited cases in support of its position. Although neither party cited the case to the Court, Ebker v. Tan Jay Int'l, Ltd., 739 F.2d 812 (2d Cir. 1984), is controlling on this issue. As Judge Friendly observed,