Searching over 5,500,000 cases.

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.


September 27, 2004.

NAVILLUS TILE, INC. et al. Defendants.

The opinion of the court was delivered by: RICHARD HOLWELL, District Judge


This action arises out of civil claims pursuant to the Racketeering Influenced and Corrupt Organizations Act, 18 U.S.C. §§ 1962, 1964 ("RICO"), and state law claims of breach of contract for unpaid wages. Defendants have moved to dismiss the complaint pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. For the reasons set forth below, the Court grants defendants' motion in its entirety, dismissing all RICO claims with prejudice and dismissing all state claims without prejudice.


  The following allegations, set forth by the complaint, are liberally construed in the light most favorable to the plaintiff and accepted as true for the purposes of this 12(b)(6) motion. Defendants are corporations licensed in the state of New York, operating as general contractors in commercial and residential construction and transacting in the purchase and sale of residential and commercial real estate. (Pl.'s Compl. ¶¶ 8, 9.) Defendant corporations are jointly owned and operated by Denis O'Sullivan, Donal O'Sullivan, Helen O'Sullivan, and Kevin O'Sullivan, all New York state residents and members of the same family, serving as officers. (Id. ¶ 9.) Around March of 1998, defendants hired Jaikarran Chandradat ("Chandradat"), a domicile of the state of New York, as an accountant for Navillus Tile, Inc. ("Navillus"). (Id. ¶ 10.) At the time of his hiring, they failed to disclose to Chandradat that Navillus was one of several interrelated corporations owned by the O'Sullivan family. (Id.) Chandradat began performing the duties of accountant and acting comptroller for Navillus in May of 1998, and worked approximately thirty-five hours a week. (Id. ¶¶ 11, 12.) His job entailed duties such as reconstructing and analyzing financial records; managing accounts payable and receivable; overseeing job costing and expense allocations; reconciling bank, credit card, loan, overdraft, and investment accounts; preparing payroll taxes and corporate and personal income tax returns; and preparing for audits performed by the Internal Revenue Service, New York State Tax Department, and New York City Tax Commission. (Id. ¶ 11.) In return for these services, Chandradat received six hundred to seven hundred dollars in cash per week until the end of the calendar year 2000. (Id. ¶ 12.)

  By the end of 2002, Chandradat was earning sixty-two thousand, five hundred dollars a year, in addition to an annual bonus of twenty thousand dollars. (Id. ¶ 13.) However, Navillus suddenly reduced Chandradat's salary to sixty percent of the gross amount during his last nineteen weeks of employment. (Id. ¶ 14.) At that time, Donal O'Sullivan and Kevin O'Sullivan also informed Chandradat that he would be required to perform similar functions for the remaining corporations in addition to his work for Navillus, thereby confirming Chandradat's growing suspicions that defendant corporations were interrelated. (Id. ¶ 15.) In response to this demand, Chandradat immediately demanded additional payment for the services he was required to perform for the corporations other than Navillus. (Id. ¶ 16.)

  However, those corporations "de facto engaged [him], in assigning their accounting duties" to him and "requiring that he perform them, immediately, upon their assignment to him." (Id. ¶ 17.) In order to complete these assignments, Chandradat worked significantly longer hours than he did when he was working solely for Navillus. (Id. ¶ 18.) When Chandradat complained to Kevin O'Sullivan and Donal O'Sullivan, they replied that they "were deferring that part of [Chandradat's] pay until their revenues had sufficiently increased." (Id. ¶ 19.) When revenues actually increased, defendants failed to pay Chandradat the compensation to which he was entitled. (Id.)

  During his employment, Chandradat allegedly observed that on several occasions, one of the defendants (or one of its principals) altered details on customer invoices such as the date, amount, or invoice number. (Id. ¶¶ 26.) Instead of paying customers on these invoices, the defendant corporations diverted the funds to their own accounts or allowed the principals to deposit the funds to their personal accounts. (Id.) Additionally, the complaint alleges that defendants often billed each other for work that had not been performed and then disbursed the proceeds in unrecorded cash to each other or to interested donees. (Id.) Defendants also bought equipment, only to sell it without "leaving a paper trail," and allowed the principals to pocket the proceeds. (Id.)

  According to Chandradat, the payroll records indicate that defendants frequently made payments to "phantom employees." (Id.) On other occasions, one or more of the principals demanded and received benefits such as home renovations without attributing it to the corporation. (Id.) Overall, defendants are alleged to have regularly engaged in "bookkeeping indiscretions," by generating "off book" balance sheets, manipulating job costs, and maintaining multiple bank accounts for Navillus that did not report all of the transactions contained on the corporate balance sheet. (Id.)

  Chandradat further alleges that defendants "knowingly recruited and hired undocumented aliens, who sometimes possessed false immigration and/or work-authorization documents, as office assistants, masons, tilers and other construction laborers" through advertisements in The New York Times and Irish Voice and international phone calls. (Id.)

  On or about May 13, 2003, Kevin O'Sullivan informed Chandradat that he was being laid off, effective immediately, and would recall him to work as soon as possible. (Id. ¶ 22.) Yet Chandradat was never recalled. (Id. ¶ 23.) Chandradat nevertheless contends that he was punctual, never absent, a "team player," sensitive to his employers and the obligations of his position, and upbeat in attitude at work, and for the purposes of this motion, the Court assumes these allegations to be true. (Id. ¶ 21.) Although Chandradat claims that he never had disciplinary issues at work, he found his employers' treatment of him forced him to become an "outsider" at the office. (Id.)

  Based on these allegations, Chandradat has asserted two causes of action. First, Chandradat alleges that defendants engaged in a fraudulent scheme involving predicate acts of mail fraud, wire fraud, money laundering, and the knowing recruitment of undocumented aliens in violation of RICO. These unlawful acts gave Chandradat the false impression that defendants had insufficient funds to pay him the wages and bonuses to which he was entitled. Second, Chandradat argues that defendants' failure to compensate him for the additional services he performed amounted to a breach of contract under state law.


  I. The Rule 12(b)(6) Standard

  In ruling on a motion to dismiss under Rule 12(b)(6), the court is required to read a complaint generously, accepting all the alleged facts as true and drawing all reasonable inferences in favor of the plaintiff. See LaBounty v. Adler, 933 F.2d 121, 123 (2d Cir. 1991); Frasier v. Gen. Elec. Co., 930 F.2d 1004, 1007 (2d Cir. 1991). The court must deny the motion unless it appears beyond a doubt that the plaintiff can prove no set of facts in support of his claim that would entitle him to relief. See Conley v. Gibson, 355 U.S. 41, 45-46 (1957). Additionally, "the review of such a motion is limited, and `[t]he issue is not whether a plaintiff will ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.