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ARAMONY v. UNITED WAY OF AMERICA

December 18, 1996

WILLIAM ARAMONY, Plaintiff, against UNITED WAY OF AMERICA, individually and as administrator and named fiduciary under the United Way of America Replacement Benefit Agreement, UNITED WAY REPLACEMENT BENEFIT PLAN and UNITED WAY SUPPLEMENTAL BENEFITS AGREEMENT, Defendants.


The opinion of the court was delivered by: SCHEINDLIN

 SHIRA A. SCHEINDLIN, U.S.D.J.:

 Plaintiff filed this action on May 25, 1996 to recover, inter alia, retirement benefits, salary, and legal expenses. On October 18, 1996, defendants moved to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). For the reasons set forth below, defendants' motion is partially granted and Claims *fn1" Seven, Twelve, Thirteen and Fourteen of the Complaint are dismissed.

 Legal Standard for Motion to Dismiss

 In deciding a Rule 12(b)(6) motion, the court must accept as true material facts alleged in the complaint and draw all reasonable inferences in the nonmovant's favor. See Kaluczky v. City of White Plains, 57 F.3d 202, 206 (2d Cir. 1995). Such a motion cannot be granted simply because recovery appears remote or unlikely on the face of a complaint, as "the issue is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims." Bernheim v. Litt, 79 F.3d 318, 321 (2d Cir. 1996) (quoting Villager Pond, Inc. v. Town of Darien, 56 F.3d 375, 378 (2d Cir. 1995) (quoting Scheuer v. Rhodes, 416 U.S. 232, 236, 40 L. Ed. 2d 90, 94 S. Ct. 1683 (1974)), cert. denied, 117 S. Ct. 50 (Oct. 7, 1996)) (internal quotation marks omitted). Rather, dismissal can only be granted if "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Scheuer, 416 U.S. at 236.

 Factual Background

 Applying the above principles, the facts of this case are as follows. Plaintiff Aramony is the former President and Chief Executive Officer of United Way of America ("UWA"), a New York non-profit organization. On April 1, 1984, plaintiff and UWA entered into an employee benefit plan (the "Replacement Benefit Plan") with a more favorable tax profile than the benefit plan in which he previously had participated. On October 12, 1984, plaintiff and UWA entered into a Supplemental Benefits Agreement. Later, the Supplemental Benefits Agreement was amended on September 26, 1988. See Complaint PP 5-7.

 In late 1991 and early 1992, a series of newspaper articles reported that plaintiff had improperly benefitted from his position at United Way. The principal allegations focused on plaintiff's expenses and alleged failure to reimburse UWA for personal items. While maintaining his innocence, plaintiff offered to retire on February 26, 1992. At the time, his offer was refused by the Board of Directors. Instead, plaintiff and UWA agreed a search should be conducted for a suitable successor, a process that was expected to take approximately six months. Plaintiff agreed to remain as CEO of UWA but to relinquish his title of President.

 In early March, 1992, UWA reversed its position and terminated plaintiff's active responsibilities. Plaintiff and UWA agreed that plaintiff's termination would not affect his status as an employee of UWA, which was to continue until the expiration of his employment contract on July 31, 1993. See Complaint P 16; see also Plaintiff's Exhibit D. Nevertheless, UWA ceased all salary payments to plaintiff on March 16, 1992, and indicated that UWA was not going to distribute plaintiff's retirement benefits to him. Since that time, UWA has not paid plaintiff any salary or retirement benefits.

 In May, 1992, plaintiff agreed to enter mediation with UWA to resolve the salary and benefit dispute. UWA agreed to negotiate in good faith and to reimburse plaintiff for the expense of participating in the mediation process. After a year of unsuccessful mediation, UWA refused to reimburse plaintiff for mediation expenses totaling $ 350,000. See Complaint P 42.

 Discussion

 I. Plaintiff's Complaint

 Defendants argue that each of plaintiff's claims must be dismissed. Plaintiff's Complaint pleads the following Claims:

 
(1) Declaratory judgment enforcing the Replacement Benefit Plan;
 
(2) Breach of Replacement Benefit Plan;
 
(3) Declaratory judgment enforcing the Supplemental ...

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