The opinion of the court was delivered by: CEDARBAUM
Plaintiff Messner Vetere Berger McNamee Schmetterer EURO RSCG Inc. ("Messner Vetere") alleges that defendant Aegis Group plc orally agreed to assume the obligations under a lease which was entered into by a predecessor-in-interest of Messner Vetere. Messner Vetere seeks a declaratory judgment that Aegis assumed all the obligations under the lease as well as damages for breach of contract.
Aegis moves to dismiss pursuant to Fed. R. Civ. P. 12(b)(6) on the ground that the claim is barred by New York's Statute of Frauds and pursuant to Fed. R. Civ. P. 19 for failing to join an indispensable party. For the reasons that follow, the motion is granted.
Allegations of the Complaint
The amended complaint (hereinafter simply the "complaint") provides a detailed account of the complex history between the parties. In the interest of clarity, the relevant allegations of the complaint are summarized below, without incorporating some of the corporate transformations which are not germane to this motion.
In 1979, Creamer Inc., an advertising agency, entered into a written lease agreement with MRI Broadway Rental, Inc. ("Landlord") pursuant to which Creamer rented the 27th floor and part of the 26th floor of the office building at 1633 Broadway in New York City. The lease runs from September 1, 1979 to August 31, 1999 at an annual rent of $ 775,450.00. After entering the lease, Creamer occupied the 27th floor and its subsidiary, CDB Inc., occupied the 26th floor. (Am. Compl. P 10).
In July of 1986, Aegis purchased all the outstanding stock of Creamer. (Id. P 7). In September of 1986, Aegis purchased all the outstanding stock of another advertising agency named Della Femina, Travisano & Partners, Inc. ("Della Femina"). In February of 1987, Creamer entered into a written sublease with an unrelated third party for all the leased space of the 26th floor through the end of the lease. The sublease was approved by the Landlord. (Id. P 10). Later in 1987, Aegis moved essentially all of Creamer's advertising operations and personnel out of the 27th floor of 1633 Broadway and into the New York offices of Della Femina. The few administrative employees who were left at 1633 Broadway became employees of WCRS, Inc., Aegis's holding company for its non-advertising subsidiaries. Aegis and WCRS, Inc. occupied space on the 27th floor, along with CDB Inc., a non-advertising subsidiary that Aegis had removed from Creamer. It is at that time in late 1987, according to the complaint, that Aegis "assumed full responsibility for payment of the rent on the Leased Space." (Id. P 11).
In October of 1989, Eurocom S.A. increased its share of WCRS Advertising Ltd. to 60%, and thereby gained control of Aegis's United States advertising subsidiaries, including Creamer. (Id. P 13). On September 14, 1990, Aegis sold all of the outstanding shares of CDB Inc. to Eurocom S.A. With regard to the space CDB Inc. occupied at 1633 Broadway, the stock purchase agreement stated that:
CDB subleases, 19,675 square feet of office space at 1633 Broadway, New York, New York at a monthly rental of $ 44,184. There is no formal sublease with respect to these premises. The lessee under the lease is Creamer, Inc. (now DFM). The lease prohibits assignment without consent except under certain circumstances including assignment to a company under common control with lessee. As DFM and CDB are not at present under common control, the sublease to CDB is not permitted under the terms of the lease. CDB owes Aegis Group plc $ 161,957.06 with respect to the renovation of the 27th floor. CDB is to pay $ 40,000 per month with payment in full [on] December 31, 1990.
In negotiating the sale of CDB Inc., Aegis's chief financial officer insisted that Eurocom S.A. commit to having CDB Inc. remain a subtenant at 1633 Broadway through the end of the lease. In return, Aegis agreed to share the proceeds from the space which CDB Inc. occupied in the event that it was marketed. In light of this agreement, Eurocom included the following commitments in the stock purchase agreement:
(i) Buyer will cause CDB to continue to pay its proportionate share of the rent payable for the space occupied on the 27th floor of 1633 Broadway ...