The opinion of the court was delivered by: Chin, U.S.D.J.
Pursuant to an affiliation agreement with the New York City Health and
Hospitals Corporation ("HHC"), defendant New York University Medical
Center ("NYU") provided medical services at Goldwater Memorial Hospital
("Goldwater Hospital") until June 30, 1997. At that time, the affiliation
agreement expired, and HHC entered into a new affiliation agreement with
Roosevelt Island Medical Associates ("Roosevelt"). Plaintiffs, seventeen
physicians employed by NYU to practice at Goldwater, were discharged by
NYU on June 30, 1997. The next day, July 1, 1997, plaintiffs began
working for Roosevelt as physicians at Goldwater Hospital.
Shortly before plaintiffs were laid off NYU amended its existing
severance pay policy to exclude employees who lost their jobs when an
affiliation contract terminated but obtained employment with the
successor contractor within 30 days of the successor contract's effective
date. Finding themselves seemingly ineligible for severance benefits,
plaintiffs filed the instant case, which alleges violations of the
Employee Retirement Income Security Act of 1974 ("ERISA"), as amended,
29 U.S.C. § 1001 et seq., as well as various state law causes of
Before the Court is NYU's motion to dismiss the complaint pursuant to
Fed. R.Civ.P. 12(b)(6) for failure to state a claim upon which relief
may be granted. Because matters outside the complaint have been
submitted, I will treat the motion as a motion for summary judgment. For
the reasons set forth below, the motion is granted and the complaint is
Construed in the light most favorable to plaintiffs, the facts are as
For a number of years prior to 1997, NYU provided medical services at
Goldwater Hospital pursuant to an affiliation agreement with HHC. During
this time, NYU employed plaintiffs as physicians at Goldwater Hospital.
On or about May 15, 1997, NYU learned that its affiliation agreement with
HHC would not be renewed
and that HHC had agreed to enter into an affiliation agreement with
Roosevelt to provide services at Goldwater. (Compl.¶ 14). As a
result of losing the affiliation agreement, NYU terminated plaintiffs'
employment on June 30, 1997. (Id. ¶¶ 17, 68). The next day, July 1,
1997, plaintiffs began working for Roosevelt at Goldwater Hospital in the
same positions they had held before. (Affirmation of Rita Aniano ("Aniano
Aff."), ¶ 11).
NYU's policy regarding severance benefits is set forth in its "Human
Resources Policies and Procedures" manual (the "Manual"), which includes
a proviso that the "policies and statements contained in this book . . .
are not a contract of any kind [and] may be changed or rescinded."*fn1
(Def. Notice of Mot., Ex. B at 1). Under the policy described in the
Manual (the "Severance Plan"), NYU had, for more than twenty years prior
to 1997, provided severance pay to eligible employees permanently laid
off due to lack of funds or lack of work. (Compl.¶ 9). The Severance
Plan listed six scenarios in which employees would not be entitled to
severance pay, including, inter alia, voluntary resignation, discharge,
and temporary layoff. (Id. ¶ 87).
On or about May 15, 1997, NYU modified the Severance Plan to include a
seventh scenario in which employees would not be eligible for severance
pay (the "Modified Severance Plan"). (Id. ¶ 88). The Modified
Severance Plan provides, in relevant part:
Employees are not entitled to severance pay in the
following cases: . . . Separation due to the
termination of an affiliation contract when such
separated employees are hired by the successor
contractor within 30 days of that contract's effective
(Id. ¶ 88; Def. Notice of Mot., Ex. C at 10-4). On May 30, 1997, NYU
issued a memorandum notifying its Goldwater Hospital staff that, due to
the loss of the affiliation contract, they would be laid off no earlier
than June 16, 1997. (Aniano Aff., Ex. 1). The memorandum did not mention
the change in severance pay policy enacted on May 15. (Id.).
According to plaintiffs, HHC accepted a bid from Roosevelt to provide
services at Goldwater Hospital in April 1997, but did not formally enter
into an affiliation agreement until August 1999. (Id. ¶ 11).
Therefore, plaintiffs contend, Roosevelt had not yet entered into an
affiliation agreement with HHC at the time plaintiffs were hired. (Id.
¶ 13). The plaintiffs also maintain that NYU paid severance benefits
to at least four "other employees similarly situated as plaintiffs."
(Id. ¶ 6).
The complaint also alleges, without elaboration, that NYU wrongfully
denied Augusta Alba, one of the plaintiffs, a retirement package offered
to other ...