Eastern Milk & Cream Co., Inc., 233 A.D. 764, 250 N.Y.S. 858 (2d Dep't.,
Consideration is defined as either a bargained for gain or advantage to
the promisee or a bargained for legal detriment or disadvantage to the
promisor. See Roth v. Isomed, Inc., 746 F. Supp. 316, 319 (S.D.N Y
1990). In its papers opposing the motion, Plaintiff contends that the
consideration for VSA's promise was the detriment to Startech's ability
to raise the funds within New York that it was required to raise under
the terms of its affiliation agreement. However, as defendant points
out, the fact that Startech was having difficulty raising money for
itself is neither a bargained for legal detriment to Startech nor a
bargained for disadvantage to VSA. It is a fact that might provide VSA
with a motive for making the promise set forth in the letter. But such a
motivation could easily support a gratuitous promise, which is precisely
what defendant contends the letter agreement is. So if consideration is
to be found, it must be elsewhere in the letter agreement.
Mindful of its duty to draw every conceivable inference in favor of
Plaintiff at this preliminary stage, and to avoid dismissing the
complaint unless I can discern no conceivable basis for recovery, the
Court has parsed the letter agreement carefully. On its face, the
document appears to make reference to something that might well qualify
as consideration — namely, Startech's "continued support of VSA's
national fund raising activities" and its "assistance" in working with
local officials and procuring permits and the like in aid of VSA's fund
raising efforts. Certainly, offering continued fund raising assistance to
VSA — especially if that assistance is provided at the expense of
plaintiff's own fund raising activities, as alleged in the complaint
— could constitute consideration for a promise to split the
proceeds of those joint activities. While it is true that an expression of
gratitude for past fund raising assistance would not constitute
consideration, see Bogardus v. Commissioner of Internal Revenue,
302 U.S. 34, 34, 58 S.Ct. 61, 61, 82 L.Ed. 32 (1937), the promise of
continued support would rise to the level of consideration — unless
for some reason Startech were required to provide fund raising assistance
to defendant (as opposed to being obligated to raise money for itself, as
alleged in Paragraph 10 of the complaint). See Roth, 746 F. Supp. at 319
(citing Holt v. Feigenbaum, 52 N.Y.2d 291, 299-300, 437 N.Y.S.2d 654,
419 N.E.2d 332 (1981)). However, nothing on the face of the complaint
would allow me to draw the conclusion that Startech was obligated to
raise money for VSA. Thus, I cannot say at this extremely early moment in
the life of this lawsuit that Startech's "continued cooperation" and
"assistance" with VSA's fund raising efforts fails to qualify as
consideration. Therefore, the breach of contract claim will not be
This ruling should in no way be read to prejudge the issue of whether
there was, in fact, valid consideration for VSA's promise. I have no
doubt that defendant will press its gratuitous promise defense, and on a
fuller record a verdict in its favor may well be appropriate.
B. Unjust Enrichment
In order to prevail on a theory of unjust enrichment, "the plaintiff
must demonstrate that (a) the defendant has been enriched; (b) the
enrichment was at the plaintiff's expense; and (c) defendant's retention
of the benefit would be unjust." Van Brunt v. Rauschenberg,
799 F. Supp. 1467 (S.D.N.Y. 1992) (quoting Hutton v. Klabal,
726 F. Supp. 67, 72 (S.D.N.Y. 1989)); (see also Mayer v. Bishop,
158 A.D.2d 878, 551 N.Y.S.2d 673 (3d Dep't), appeal denied, 76 N.Y.2d 704,
559 N.Y.S.2d 983, 559 N.E.2d 677 (1990)).
Plaintiff alleges Defendant has been unjustly enriched at the expense
of Plaintiff by failing to pay Plaintiff 50% of all gross proceede from
private fund raising activities in New York from October 1994 through
September 1997. For much
the same reason that I cannot dismiss the breach of contract claim, I
cannot dismiss the unjust enrichment claim. If Startech's efforts on
behalf of VSA do not suffice to support a contract, they may nonetheless
render it inequitable for VSA to retain 100% of any funds that the two
organizations raised jointly. If, for example, the facts bear out that
VSA has received some benefit in its own fund raising by virtue of
assistance rendered by plaintiff — especially assistance rendered
with the 50/50 split letter lurking in the background — unjust
enrichment might turn out to be an appropriate theory of recovery.
The parties are directed to abide by the attached scheduling order.
This constitutes the decision and order of the Court.
Consent Scheduling Order
Upon consent of the parties, it is hereby ORDERED as follows:
1. Rule 26(a) discovery must be exchanged on or before
1/5/01, which is 30 days after service of the
decision on motion to dismiss.
2. No additional parties may be joined after N/A.
3. No amendments to the pleadings will be permitted
4. All discovery shall be completed on or before
5. Do not contact Judge McMahon about discovery
disputes; go directly to your assigned Magistrate
Judge. Please provide the Magistrate Judge with the
Order of Reference on or before a scheduled
appearance pertaining to discovery issues.
6. A joint pretrial order in the form prescribed in
Judge McMahon's individual rules shall be filed on or
before 6/1/01, together with any in limine motions
and memos of law. Responses to in limine motions, if
any, shall be filed by 6/15/01. The court will then
schedule a final pretrial conference.
7. No motion for summary judgment shall be served after
the deadline fixed for submission of the pretrial
order. The filing of a motion for summary judgment
does not relieve the parties of the obligation to
file the pretrial order on time.
8. If any party claims a right to trial by jury,
proposed voir dire questions and jury instructions
shall be filed with the joint pretrial order.
9. Any party seeking damages from any other party must
append to this statement a one-page addendum
explaining the factual and legal basis for the
claimed damages, explaining how you propose to prove
damages and setting forth a calculation of
10. This scheduling order may be altered or amended only
on a showing of good cause not foreseeable at the
date hereof. Counsel should not assume that
extensions will be granted as a matter of routine.
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