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TREPPEL v. BIOVAIL CORPORATION

United States District Court, S.D. New York


August 30, 2005.

JERRY I. TREPPEL, Plaintiff,
v.
BIOVAIL CORPORATION, EUGENE N. MELNYK, KENNETH C. CANCELLARA, MICHAEL S. SITRICK, and SITRICK AND COMPANY, INC., Defendants.

The opinion of the court was delivered by: PETER LEISURE, District Judge

OPINION AND ORDER

For the second time in this action, the Court considers a motion to dismiss for failure to state a claim brought by defendants. Defendants' first motion to dismiss was denied in part and granted in part. Three of the five defendants, Kenneth C. Cancellara, Esq. ("Cancellara"), Michael Sitrick, and Sitrick and Company (the "Sitrick Defendants"), then sought reconsideration of the Court's ruling as it related to plaintiff's claims against them. The Court granted their motion and dismissed without prejudice the balance of the claims remaining against them. Plaintiff, Jerry I. Treppel ("Treppel"), subsequently amended the Amended Complaint and re-asserted some of the dismissed claims against all defendants. In response, defendants filed the instant motion, again seeking dismissal of all claims against Cancellara and the Sitrick Defendants.*fn1 In addition, Melnyk asserted three counterclaims, which plaintiff now petitions the Court to dismiss. The Court addresses both motions below in seriatim.

  BACKGROUND

  The factual history of this case is set forth in the Court's two prior opinions, with which the Court assumes familiarity. See Treppel v. Biovail Corp., No. 03 Civ. 3002, 2005 U.S. Dist. LEXIS 2737 (S.D.N.Y. Feb. 22, 2005) ("Treppel II"); Treppel v. Biovail Corp., No. 03 Civ. 3002, 2004 U.S. Dist. LEXIS 20714 (S.D.N.Y. Oct. 15, 2004) ("Treppel I"). Plaintiff's Amended Complaint in this action asserted claims of defamation, defamation per se, tortious interference with prospective economic advantage, prima facie tort, and civil conspiracy against all five defendants. On October 15, 2004, the Court denied in part and granted in part defendants' first motion to dismiss. Specifically, the Court (1) sustained plaintiff's claims of defamation and defamation per se with respect to three of the eleven statements alleged; (2) sustained plaintiff's claim of tortious interference with prospective economic advantage; (3) dismissed plaintiff's claim of prima facie tort; and, (4) sustained plaintiff's claim of civil conspiracy. See generally, Treppel I.

  Thereafter, Cancellara, Biovail's General Counsel, and the Sitrick Defendants, who were hired by Biovail to serve as media contacts, petitioned the Court to reconsider Treppel I to the extent that it sustained plaintiff's claims for tortious interference with prospective economic advantage and civil conspiracy against them. Cancellara and the Sitrick Defendants maintained that plaintiff's claim of tortious interference failed to satisfy the more exacting standard established by the New York Court of Appeals in Carvel Corp. v. Noonan, 3 N.Y.3d 182, 190, 818 N.E.2d 1100, 1103 (2004), which this Court did not have the opportunity to consider because it was issued the day before Treppel I. Furthermore, they argued the civil conspiracy claim against them should be dismissed because it requires an underlying independent tort, and without the tortious interference claim, there would be no other surviving claim against them. On February 22, 2005, the Court granted Cancellara and the Sitrick Defendants' motion for reconsideration, and dismissed the tortious interference and civil conspiracy claims against them without prejudice. See Treppel II. Plaintiff was given 30 days to amend his claims in a manner consistent with the Court's ruling. Subsequently, Treppel filed a Second Amended Complaint ("SAC"), which re-alleges claims of defamation, defamation per se, tortious interference with prospective business advantage, and civil conspiracy against all five defendants. Treppel continues to assert that defendants launched a public smear campaign that ruined his reputation and career as a securities analyst in retaliation for his criticism of Biovail and its management. In the present motion, defendants maintain that Treppel's amendments do not substantively alter the claims against Cancellara and the Sitrick Defendants, and therefore, the four claims against them should be dismissed for essentially the same reasons that they were previously dismissed. In addition, Melnyk counterclaimed for defamation, defamation per se, and civil conspiracy, alleging that Treppel, in concert with others, has engaged in a smear campaign of his own intended to discredit Melnyk. In response, Treppel moves to dismiss for failure to state a claim on the grounds that the counterclaims are not pled with sufficient particularity, the alleged defamatory statements are non-actionable statements of opinion, and certain statements are barred by New York's one-year statute of limitations.

  DISCUSSION

  I. Rule 12(b)(6) Standard

  When determining whether plaintiff's claim should be dismissed on motion for failure to state a claim for which relief may be granted, the Court "must accept as true all of the factual allegations set out in plaintiff's complaint, draw inferences from those allegations in the light most favorable to plaintiff, and construe the complaint liberally." Gregory v. Daly, 243 F.3d 687, 691 (2d Cir. 2001) (quoting Tarshis v. Riese Org., 211 F.3d 30, 35 (2d Cir. 2000)); see also Hosp. Bldg. Co. v. Trs. of Rex Hosp., 425 U.S. 738, 740 (1976); Walker v. City of New York, 974 F.2d 293, 298 (2d Cir. 1992), cert. denied, 507 U.S. 961, and, 507 U.S. 972 (1993). Similarly, when considering a motion to dismiss a counterclaim for failure to state a claim, the Court must accept the material facts alleged in defendants' answer and counterclaim as true and construe all reasonable inferences in favor of defendants. See Twinlab Corp. v. Signature Media Servs., No. 99 Civ. 169, 1999 U.S. Dist. LEXIS 18973, at *10 (S.D.N.Y. Dec. 6, 1999) (citing, inter alia, Gant v. Wallingford Bd. of Educ., 69 F.3d 669, 673 (2d Cir. 1995)). Thus, "[t]he issue is not whether [the claimant] will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims." Scheuer v. Rhodes, 416 U.S. 232, 236 (1974); see also Hamilton Chapter of Alpha Delta Phi, Inc. v. Hamilton College, 128 F.3d 59, 62-63 (2d Cir. 1997). A party's claim should not be dismissed in this instance "unless it appears beyond doubt that the [movant] can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46 (1957); see also Lipsky v. Commonwealth United Corp., 551 F.2d 887, 894-95 (2d Cir. 1976). However, the claim "must contain allegations concerning each of the material elements necessary to sustain recovery under a viable legal theory." Huntington Dental & Med. Co. v. Minnesota Mining & Mfg. Co., No. 95 Civ. 10959, 1998 WL 60954, at *3 (S.D.N.Y. Feb. 13, 1998).

  II. Plaintiff's Claims Against Cancellara and the Sitrick Defendants

  A. Defamation/Defamation Per Se

  Plaintiff alleges that all five defendants, acting in concert, defamed him by issuing three statements that were incorporated into articles published by print and wire media in the United States and Canada. One of the statements, Statement 31(d),*fn2 is attributed solely to Melnyk, the Chairman and Chief Executive Office of Biovail, and therefore, plaintiff does not argue that it may serve as the basis for a defamation claim against Cancellara or the Sitrick Defendants. The other two statements, 30(a) and 31(b), were attributed only to Biovail in the Amended Complaint (Amended Complaint ¶¶ 30(a), 31(b)), but are now attributed to all five defendants in the SAC (SAC ¶¶ 30(a), 31(b)).*fn3 Plaintiff argues that the statements were always attributed to all of the defendants, albeit not expressly, because a corporation can only speak through its officers, employees, and authorized agents. (See Pl. Mem. at 9.) Moreover, plaintiff emphasizes the all-inclusive prefatory language preceding both allegations, which provides that "defendants, acting in concert, also defamed Treppel by making or issuing the following oral or written statements. . . ." (Id.; SAC ¶¶ 30, 31.) Finally, plaintiff contends that the Court in Treppel I concluded that his claims for defamation and defamation per se applied to all defendants collectively, rather than only to the defendants to whom the surviving statements were attributed. (See Pl. Mem. at 10-11.)

  As the Court explained in Treppel II, "[w]ithout an allegation of a false and defamatory statement, it is axiomatic that a plaintiff cannot establish a cause of action for defamation." Treppel II, at *18-19. Therefore, the Court determined, plaintiff failed to allege a claim for defamation or defamation per se against Cancellara and the Sitrick Defendants because none of the three surviving statements were attributed to them. Id. at *19. Plaintiff's stylistic amendments to the Amended Complaint do not convince the Court that it should now depart from this view.*fn4 Plaintiff is correct that a corporation can only speak through its officers, employees and authorized agents. (See Pl. Mem. at 9.) However, that does not mean that every agent of a corporation is potentially culpable for a tort alleged against the corporation. In replacing "Biovail" with "defendants" in the SAC without adding specific allegations implicating the individual defendants, plaintiff attempts to turn the doctrine of agency liability on its head, seeking to hold four of Biovail's agents liable for a statement attributed to their principal.

  Furthermore, under New York law, "all who take part in the procurement, composition and publication of a libel are responsible in law and equally so." Brown v. Mack, 185 Misc. 368, 373 (N.Y. Sup. Ct. 1945) (citation omitted). Thus, a defamation claim cannot survive without an allegation that defendants participated in the creation or the publication of the statements at issue. See, e.g., Mahoney v. Staffa, 256 A.D.2d 827, 828 (App.Div. 1998) (affirming the dismissal of defamation claim because there was no evidence that the declarant was speaking on behalf of or at the direction of defendant); Kjar v. Jordan, 217 A.D.2d 981, 981 (App.Div. 1995) (dismissing a defamation claim where defendant "neither made the alleged defamatory statements nor participated in their publication"); Kraus v. Brandstetter, 202 A.D.2d 396, 397 (App.Div. 1994) (finding the complaint should not be reinstated against three defendants who did not participate in the publication of the alleged defamatory statement); McGill v. Parker, 179 A.D.2d 98, 106 (App.Div. 1992) (dismissing a defamation claim because the "mere receipt of an alleged libelous statement does not establish libel on the part of the person who receives the statement").

  Here, plaintiff's allegations that defendants issued Statements 30(a) and 31(b) as part of a larger effort to discredit him are insufficient to support a claim of defamation or defamation per se against Cancellara or the Sitrick Defendants. Although at all relevant times Cancellara was Biovail's General Counsel and the Sitrick Defendants served as media contacts for Biovail, without a more specific allegation, the Court cannot simply infer that they were involved in the creation or the publication of the statements at issue. If that were the case, all officers, employees and authorized agents of Biovail would be vulnerable to a defamation charge. According to the Amended Complaint and the media who incorporated the statements into articles, Statements 30(a) and 31(b) are attributable to Biovail. Other statements, including Statements 29(c) and 29(d), which were dismissed by the Court as non-actionable opinion, were attributed to Cancellara and Michael Sitrick respectively. See Treppel I, at *48-49. Plaintiff cannot avoid this important practical and legal distinction by strategically substituting "Biovail" with "defendants" in the SAC. This would elevate form over substance and the law requires a substantive allegation that each defendant played a role in the creation or the publication of the statement. Accordingly, the Court finds that plaintiff has not alleged any additional facts that connect Cancellara or the Sitrick Defendants to Statements 30(a) or 31(b) and therefore, plaintiff's claims of defamation and defamation per se against these defendants must be dismissed. B. Tortious Interference with Prospective Economic Advantage

  To establish a claim for tortious interference with prospective economic advantage, plaintiff must prove: (1) there was a business relationship with a third party; (2) defendants knew of that relationship and intentionally interfered with it; (3) defendants either acted "solely out of malice" or used "wrongful means;" and, (4) defendants' interference caused injury to the relationship with the third-party. See Carvel Corp. v. Noonan, 350 F.3d 6, 17 (2d Cir. 2003). In Treppel II, the Court reviewed the New York Court of Appeals' recent decision in Carvel Corp. v. Noonan, 3 N.Y.3d 182 (2004), which clarified the meaning of "wrongful means" in the tortious interference context and was the impetus for Cancellara and the Sitrick Defendants' motion for reconsideration. See Treppel II, at *13-17. More specifically, the Court recognized the "general rule" established by the Court of Appeals, namely that a defendant's wrongful means must amount to a crime or an independent tort. Id. at *14 (quoting Carvel Corp., 3 N.Y.3d at 190). Relying on Carvel, the Court granted Cancellara and the Sitrick Defendants' motion for reconsideration and dismissed the claims of tortious interference against them because plaintiff failed to allege any conduct attributable to these defendants that was either tortious or criminal. See Treppel II, at *20-27.

  As was the case in Treppel II, because the Court finds that none of the defamatory statements are attributable to Cancellara or the Sitrick Defendants, plaintiff's tortious interference claim against these defendants again rests solely upon the allegations of non-defamatory conduct.*fn5 Moreover, similar to his amended defamation allegations, plaintiff attempts to cure the past deficiencies of his tortious interference allegations by making stylistic alterations to the Amended Complaint. Plaintiff adds that defendants obtained his account statements and documents through improper discovery "as part of and in furtherance of their conspiracy and concerted actions to defame and otherwise tortiously harm plaintiff in his profession and career." (SAC ¶ 19.) Further, plaintiff now claims that defendants not only falsely advised The Wall Street Journal about his trading Andrx options, but also made "misrepresentations" to the newspaper on that subject. (Id. ¶¶ 26, 30.) Finally, plaintiff alleges that defendants made "misrepresentations" to his employer, Banc of America Securities, and threatened not only to sue it, but also to cause it "other economic harm." (Id. ¶ 34.) These vague and conclusory amendments do not transform plaintiff's allegations of wrongful means into a tort or a crime. A conclusory allegation of a larger tortious conspiracy does not necessarily clothe the underlying conduct alleged — "improper discovery," "secret" provision of personal account records, and "pressuring" plaintiff's employer — in tortious or criminal cloth. As with the amended defamation claims, plaintiff has failed to allege any new substantive facts that rehabilitate these claims. Thus, for the same reasons set forth in Treppel II, plaintiff's amended allegations do not constitute wrongful means under Carvel, and therefore plaintiff's claims of tortious interference with prospective business advantage against Cancellara and the Sitrick Defendants are dismissed.

  C. Civil Conspiracy

  Under New York law, a claim for civil conspiracy may stand only if it is connected to a separate underlying tort. See Alexander & Alexander Inc. v. Fritzen, 68 N.Y.2d 968, 969, 503 N.E.2d 102, 102 (1986). "[P]laintiff may plead the existence of a conspiracy . . . to demonstrate that each defendant's conduct was part of a common scheme." World Wrestling Fed'n. Entm't., Inc. v. Bozell, 142 F. Supp. 2d 514, 532-33 (S.D.N.Y. 2001) (citations omitted). To establish a claim of civil conspiracy, plaintiff must demonstrate the underlying tort, plus the following four elements: (1) an agreement between two or more parties; (2) an overt act in furtherance of the agreement; (3) the parties' intentional participation in the furtherance of a plan or purpose; and, (4) resulting damage or injury. Id.

  Plaintiff argues that, even if he cannot establish any independent claims against Cancellara or the Sitrick Defendants individually, the civil conspiracy claims against these three defendants should stand because the underlying independent tort requirement has been satisfied by his claims of defamation and tortious interference against Biovail and Melnyk, which the Court has sustained. (See Pl. Mem. at 14-15.) The law, plaintiff contends, does not require him to establish that each co-conspirator has committed the predicate tort upon which the civil conspiracy claim is based. (Id. at 15.) While plaintiff need not allege and prove that each defendant committed every element of the underlying tort, see Snyder v. Puente De Brooklyn Realty Corp., 297 A.D.2d 432, 435 (App.Div. 2002), as noted above, he is required to demonstrate four elements in addition to the underlying tort, including that there was an agreement between the conspirators and they committed an overt act in furtherance of the agreement. Indeed, "[a]lthough tort liability may be imposed based on allegations of conspiracy which `connect nonactors, who might otherwise escape liability, with the [tortious] acts of their coconspirators,' more than a conclusory allegation of conspiracy or common purpose is required to state a cause of action against such nonactor." Schwartz v. Soc'y of the New York Hosp., 199 A.D.2d 129, 129-30 (App.Div. 1993) (citations omitted) (dismissing conspiracy to defame claims against non-actors because plaintiff failed to allege any "independent culpable behavior" on their part to link them to the allegedly defamatory statements); see also Donini Int'l, S.p.A. v. Satec (U.S.A.) LLC, No. 03 Civ. 9471, 2004 U.S. Dist. LEXIS 13148, at *9 (S.D.N.Y. July 12, 2004) ("Conclusory claims of conspiracy that are not pleaded with sufficient factual grounding should be dismissed.") (citations omitted).

  Plaintiff's perfunctory refrain that Cancellara and the Sitrick Defendants participated in a "conspiracy and concerted actions to defame and otherwise tortiously harm plaintiff in his profession and career" is insufficient to support a civil conspiracy claim against these three defendants. (SAC ¶¶ 5, 11, 12.) It does not establish that these defendants engaged in any "independent culpable behavior" connecting them to the underlying torts of defamation and tortious interference alleged against Biovail and Melnyk. See Schwartz, 199 A.D.2d at 129-30. Specifically, there has been no showing that Cancellara and the Sitrick Defendants agreed to participate in a conspiracy or committed an overt act in furtherance of the conspiracy. Thus, the civil conspiracy claims against these defendants are also dismissed.

  III. Melnyk's Counterclaims

  In his Answer to plaintiff's SAC, defendant Melnyk, Biovail's Chairman and Chief Executive Officer, asserts counterclaims for defamation, defamation per se, and civil conspiracy against Treppel. Melnyk maintains that, beginning no later than early 2002 and continuing to the present, Treppel, in concert with others, has engaged in a retaliatory smear campaign against Melnyk and Biovail for the purpose of injuring Melnyk's professional reputation and to manipulate the stock price of Biovail and certain of its competitors for their own financial benefit. (See Defendant Melnyk's Answer And Affirmative Defenses to Second Amended Complaint And Counterclaim ("Melnyk Ans.")*fn6 ¶¶ 1, 3.) In particular, Melnyk argues that Treppel, in concert with others, has defamed him in the following manner:

(1) falsely stating or implying to actual or potential Biovail investors, customers, and business partners that Melnyk has directed Biovail to engage in "illegal" corporate accounting by issuing "fake" and "phony" operating results and cash flow reports that were just "like so many lies from . . . Enron" ("Accounting Allegation") (id. ¶ 4);
(2) falsely stating or implying to actual or potential Biovail investors, customers, and business partners that Melnyk has directed Biovail to participate in a "phony truck accident" [involving a Biovail shipment] that was "criminal," a "total fraud," and "one of the biggest lies and frauds in Canadian corporate history" ("Accident Allegation") (id.); and,
(3) contributing to the publication of certain false stories regarding Melnyk and Biovail in the press stating or implying that under Melnyk's direction Biovail made inappropriate payments to physicians in an effort to get them to prescribe Biovail products ("Payment Allegation") (id. ¶ 5).
  Melnyk alleges that Treppel and others uttered the statements supporting the Accounting Allegation and the Accident Allegation at various public and private forums, including orally at an industry conference in Las Vegas on May 19-21, 2004, as well as through written electronic communications on fifteen different dates in March 2005, and that they continue to make such statements. (Id. ¶ 4.)

  A. Defamation/Defamation Per Se

  As the Court stated in Treppel I, to establish a defamation claim under New York law, the plaintiff must prove four elements in order to prevail: (1) a false and defamatory statement of fact; (2) regarding the plaintiff; (3) published to a third party by the defendant; and, (4) resulting in injury to the plaintiff. See Dellefave v. Access Temps., Inc., No. 99 Civ. 6098, 2001 WL 25745, at *4 (S.D.N.Y. Jan. 10, 2001) (citing Weldy v. Piedmont Airlines, Inc., 985 F.2d 57, 61 (2d Cir. 1993)). A defamatory statement is one that leaves an individual vulnerable to "public hatred, shame, obloquy, contumely, odium, contempt, ridicule, aversion, ostracism, degradation, or disgrace, or . . . [which] induce[s] an evil opinion of one in the minds of right-thinking persons, and . . . deprives one of . . . confidence and friendly intercourse in society." Celle v. Filipino Reporter Enters, Inc., 209 F.3d 163, 177 (2d Cir. 2000).

  In addition to the aforementioned elements, a claimant in a defamation action must also plead special damages,*fn7 unless the language at issue qualifies as defamation per se. Defamation per se may be defined as a statement that casts aspersions upon the basic character and integrity of an individual or business. Thus, a statement "which tends to disparage a person in the way of his office, profession or trade" is defamatory per se and does not require proof of special damages because injury is assumed. Davis v. Ross, 754 F.2d 80, 82 (2d Cir. 1985) (quoting Nichols v. Item Publishers, 309 N.Y. 596, 602 (1956)); see also Four Star Stage Lighting, Inc. v. Merrick, 56 A.D.2d 767, 768 (App.Div. 1977) (holding that "words are libelous if they affect a person in his profession, trade, or business by imputing to him any kind of fraud, dishonesty, misconduct, incapacity, unfitness or want of any necessary qualification in the exercise thereof").

  At the motion to dismiss stage, where the allegations must be accepted as true and all reasonable inferences must be drawn in the claimant's favor, see Conley, 355 U.S. at 46, the Court's task is clear: to determine whether the statements at issue are "reasonably susceptible of a defamatory meaning." Armstrong v. Simon & Schuster, Inc., 85 N.Y.2d 373, 380, 649 N.E.2d 825, 829 (1985); see also Celle, 209 F.3d at 177 (observing that whether particular words are defamatory is a legal question to be decided by the court as a threshold matter); Kelly v. Schmidberger, 806 F.2d 44, 46 (2d Cir. 1986) ("[O]n a motion to dismiss or for summary judgment, the issue is not whether the court regards the language as libelous, but whether it is reasonably susceptible of such a construction."). If the Court deems the statements to be reasonably susceptible to a defamatory interpretation, then "it becomes the jury's function to say whether that was the sense in which the words were likely to be understood by the ordinary and average reader." James v. Gannett Co., Inc. 40 N.Y.2d 415, 419, 353 N.E.2d 834, 838 (1976) (citation omitted).

  Furthermore, because the Court accepts the allegations as true, it assumes that the alleged statements are false and that declarants were culpable in making the statements. See Lucking v. Maier, No. 03 Civ. 1401, 2003 U.S. Dist. LEXIS 23060, at *8 n. 4 (S.D.N.Y. Dec. 23, 2003) ("The falsity of the accused passage and defendants' fault are both presumed at this [motion to dismiss] juncture."); Daniels v. Provident Life & Cas. Ins. Co., No. 02 Civ. 0668, 2002 U.S. Dist. LEXIS 24704, at *15-16 (W.D.N.Y. Dec. 22, 2002) (denying defendant's motion to dismiss due to a dispute as to the truth of alleged facts).

  Finally, defamation claims are subject to the liberal pleading standards of Rule 8 of the Federal Rules of Civil Procedure. See Fed.R.Civ.P. 8; see also Kelly, 806 F.2d at 46. In federal court, a complaint need not specifically plead the alleged defamatory words so long as it provides the opposing party "sufficient notice of the communications complained of to enable him to defend himself." Kelly, 806 F.2d at 46. Contra Skelly v. Visiting Nurse Ass'n of the Capital Region Inc., 210 A.D.2d 683, 686 (App.Div. 1994) (affirming that New York state law mandates dismissal of defamation claim where the statement itself is not set forth in the complaint). However, even under the liberal standard of Rule 8, to establish a claim for defamation, the complaint must identify (1) the allegedly defamatory statements; (2) the person who made the statements; (3) the time when the statements were made; and, (4) the third parties to whom the statements were published. See Mobile Data Shred, Inc. v. United Bank of Switzerland, No. 99 Civ. 10315, 2000 WL 351516, at *6 (S.D.N.Y. Apr. 5, 2000); Ives v. Guilford Mills, Inc., 3 F. Supp. 2d 191, 199 (N.D.N.Y. 1998); Reeves v. Cont'l Equities Corp. of Am., 767 F. Supp. 469, 473 (S.D.N.Y. 1991).

  Treppel's first argument in support of dismissal is that Melnyk has failed to allege the defamatory statements and surrounding facts with sufficient particularity. (See Plaintiff's Memorandum of Law In Support Of His Motion To Dismiss Defendant Melnyk's Counterclaims ("Pl. C-Cl. Mem.") at 3-6.) The Court disagrees with plaintiff as to the Accounting Allegation and the Accident Allegation but agrees that the Payment Allegation fails under Rule 8. The Accounting Allegation and Accident Allegation each provide sufficient information and detail to enable Treppel to respond. See Kelly, 806 F.2d at 46. In addition to quoting portions of the alleged statements, they identify who made the statements (Treppel and others), when the statements were made (on May 19-21, 2004, as well as on or about fifteen dates in March 2005), and the third parties to whom the statements were published (actual or potential Biovail investors, customers, and business partners). Thus, the Accounting Allegation and the Accident Allegation are properly pled.

  The Payment Allegation, however, is not pled with sufficient particularity because it fails to indicate when the statements concerning Biovail's payments to physicians were made. The failure to provide a timeframe deprives plaintiff of information crucial to his ability to respond to the claim. As a result, this allegation is dismissed and may not serve as a basis for Melnyk's counterclaims for defamation and defamation per se. The second argument Treppel offers in favor of dismissal is that the alleged statements are non-actionable statements of opinion or rhetorical hyperbole. (See Pl. C-Cl. Mem. at 6-8.) Treppel relies upon the fact that the New York Constitution, unlike the Federal Constitution, provides for absolute protection of pure opinions. See Flamm v. Am. Assoc. of Univ. Women, 201 F.3d 144, 147-48 (2d Cir. 2000). This constitutional protection requires that assertions of fact, not opinion, form the basis of a defamation claim. See Brian v. Richardson, 87 N.Y.2d 46, 51, 660 N.E.2d 1126, 1129 (1995) (citations omitted). Thus, the Court's "essential task" in this context is to determine whether the allegedly defamatory statements "may be reasonably understood as implying the assertion of undisclosed facts justifying the opinion," when considering the statements in the immediate context of the communication as a whole, and the broader context in which the statements were published. Steinhilber v. Alphonse, 68 N.Y.2d 283, 292, 501 N.E.2d 550, 554 (1986); see also Brian, 87 N.Y.2d at 51, 660 N.E.2d at 1129; Immuno AG v. Moor-Jankowski, 77 N.Y.2d 235, 254, 567 N.E.2d 1270, 1280-81 (1991). If one of the statements may be viewed as implying undisclosed facts, then it is not protected as opinion under the New York Constitution. See Steinhilber, 68 N.Y.2d at 292, 501 N.E.2d at 554.

  The New York Court of Appeals has considered the following factors when distinguishing between assertions of fact and non-actionable expressions of opinion:

(1) whether the specific language in issue has a precise meaning which is readily understood; (2) whether the statements are capable of being proven true or false; and, (3) whether either the full context of the communication in which the statement appears or the broader social context and surrounding circumstances are such as to "signal . . . readers or listeners that what is being read or heard is likely to be opinion, not fact."
Gross v. N.Y. Times Co., 82 N.Y.2d 146, 153, 623 N.E.2d 1163, 1167 (1993) (quoting Steinhilber, 68 N.Y.2d at 292, 501 N.E.2d at 554). Finally, when an opinion is offered in excessive terms, a reasonable audience may not fairly conclude that the opinion has any basis in fact. This type of speech, often described as "rhetorical hyperbole," can be so "imprecise" and uttered in such an "unusual setting [that it] would signal the reasonable observer that no actual facts were being conveyed about an individual." Immuno, 77 N.Y.2d at 244, 567 N.E.2d at 1274. As a result, such "loose" or "figurative" language is afforded constitutional protection and may not form the basis of a claim for defamation. See Milkovich v. Lorain Journal Co., 497 U.S. 1, 16-17 (citing Greenbelt Coop. Publ'g. Assn. v. Bresler, 398 U.S. 6 (1970) (finding defendant's description of plaintiff's position as "a slight case of blackmail" to be "rhetorical hyperbole" and "a vigorous epithet")).

  The Court finds that neither the Accounting Allegation nor the Accident Allegation is a protected statement of opinion or rhetorical hyperbole. First, with respect to the Accounting Allegation, the statement by Treppel, an analyst who covered Biovail and its management for several years, that Melnyk directed Biovail to engage in "illegal" corporate accounting may be understood as implying the existence of undisclosed facts. The average listener could reasonably conclude that Treppel's position as an analyst afforded him access to certain information about Biovail that had not been widely circulated. Moreover, the fact that the investigation into Biovail's accounting practices may have been reported publicly does not mean it was generally understood that the company's financial statements were "fake," "phony" and just "like so many lies from . . . Enron." These types of definitive claims suggest wrongdoing on a scale larger than would be discerned from reports of a regulatory investigation. Furthermore, though the statements are sweeping, they have a precise meaning and are capable of being objectively characterized as true or false. See Steinhilber, 68 N.Y.2d at 292, 501 N.E.2d at 554. Thus, they are not sufficiently excessive or unusual to be characterized as rhetorical hyperbole. As a result, if actual or potential Biovail investors, customers, and business partners heard or read these statements, they could reasonably infer that the statements were based upon undisclosed facts. Accordingly, the Accounting Allegation may support a claim for defamation against Treppel and, because the statements tend to disparage Melnyk in his position as Chairman and Chief Executive of Biovail, they may sustain a claim for defamation per se as well.

  With respect to the Accident Allegation, a similar analysis applies. The statement by Treppel that Melnyk directed Biovail to participate in a "phony truck accident" that was "criminal," a "total fraud," and "one of the biggest lies and frauds in Canadian corporate history" plainly accuses Melnyk and Biovail of engaging in specific illegal conduct. As with the coverage of the investigations into Biovail's accounting practices, publicity concerning a truck accident involving a Biovail shipment would not necessarily lead to the conclusion that the accident was part of one of the most significant frauds in Canadian history. Thus, like the statements supporting the Accounting Allegation, these statements can be reasonably understood to be implying the assertion of undisclosed facts, namely that Melnyk and Biovail staged the truck accident for their own financial gain. Moreover, the statements are neither figurative nor extreme but are sufficiently precise such that they are capable of being proven true or false. Because they also tend to disparage Melnyk in his professional capacity, the statements underlying the Accident Allegation may be used to support Melnyk's claims for defamation and defamation per se.

  Finally, Treppel argues that claims based upon the alleged statements made in Las Vegas on May 19-21, 2004 are time-barred because a claim for defamation must be commenced within one year, see N.Y.C.P.L.R. 215(3), and Melnyk did not file his Answer and Counterclaims until May 27, 2005. (See Pl. C-Cl. Mem. at 8-9.) However, at least one court is this Circuit has held that the filing of an action tolls the limitations period for compulsory counterclaims. See Andre v. Schenectady Cty., 95 Civ. 573, 1997 U.S. Dist. LEXIS 3564, at *6 (N.D.N.Y. Mar. 13, 1997). Accordingly, the statements made in Las Vegas may be used to support Melnyk's counterclaims if the counterclaims are deemed compulsory.

  The Federal Rules of Civil Procedure define a compulsory counterclaim as any claim which, at the time of serving the pleading, the pleader has against any opposing party, if it arises out of the transaction or occurrence that is the subject matter of the opposing party's claim and does not require for its adjudication the presence of third parties over whom the court cannot obtain jurisdiction. Fed.R.Civ.P. 13(a). If such compulsory counterclaims are not timely asserted, they are forfeited. See Jones v. Ford Motor Credit Co., 358 F.3d 205, 209 (2d Cir. 2004) (citation omitted). In determining whether the counterclaims arise out of the same transaction or occurrence as the original claims, the Second Circuit requires a "logical relationship" between the two sets of claims, United States v. Aquavella, 615 F.2d 12, 22 (2d Cir. 1979), such that "`considerations of judicial economy and fairness dictate that all the issues be resolved in one lawsuit,'" Critical-Vac Filtration Corp. v. Minuteman Int'l, Inc., 233 F.3d 697, 699 (2d Cir. 2000) (quoting Adam v. Jacobs, 950 F.2d 89, 92 (2d Cir. 1991)).

  While there may be an attenuated connection between the two smear campaigns alleged here, in that one was allegedly launched in retaliation for the other, there is not a logical relationship between the two sets of claims necessitating their joint resolution. Treppel's claims arise out of alleged statements made to the media in 2002 by Melnyk and others concerning Treppel's performance as a securities analyst. Melnyk's claims, on the other hand, arise out of alleged statements made to Biovail investors, customers, and business partners in 2004 and 2005 by Treppel and others concerning Melnyk's performance as Biovail's Chairman and Chief Executive Officer. Thus, the two sets of claims are based on varying statements concerning divergent subjects made by different individuals and published to two distinct groups more than two years apart from one another. Though they both sound in defamation, their essential facts are not so closely related that resolving these two sets of issues in one lawsuit would yield judicial efficiency. As a result, the Court finds that Melnyk's counterclaims are not compulsory, and therefore, to the extent they rely upon the May 19-21, 2004 statements made in Las Vegas, they are time-barred.

  B. Civil Conspiracy

  In addition to claiming defamation and defamation per se, Melnyk asserts a civil conspiracy claim, alleging that Treppel, along with other unnamed parties, entered into an agreement to ruin Melnyk and his professional reputation. (See SAC ¶¶ 17-20.) He maintains "Treppel and those with whom he has and continues to act in concert engaged and intentionally participated in the defamatory and other unlawful conduct . . . as part of and in furtherance of their agreement, common scheme, plan and purpose to harm Melnyk and his professional reputation." (Id. ¶ 19.) As discussed supra, Discussion Part II.C., civil conspiracy may be pled to connect the actions of separate defendants with an underlying tort. See Alexander, 68 N.Y.2d at 969, 503 N.E.2d at 102. Thus, Melnyk must demonstrate the underlying tort, plus (1) an agreement between two or more parties; (2) an overt act in furtherance of the agreement; (3) the parties' intentional participation in the furtherance of a plan or purpose; and, (4) resulting damage or injury. See World Wrestling Fed'n, 142 F. Supp. 2d at 532-33. His conclusory allegations, which do not even identify Treppel's alleged co-conspirators, fall well short of this standard. See Donini Int'l, 2004 U.S. Dist. LEXIS 13148, at *9 ("Conclusory claims of conspiracy that are not pleaded with sufficient factual grounding should be dismissed.") (citations omitted). Accordingly, Melnyk's counterclaim for civil conspiracy must be dismissed.

  IV. Leave to Replead

  Pursuant to Rule 15(a), leave to amend the complaint "shall be freely given when justice so requires." Fed.R.Civ.P. 15(a); see also Hayden v. County of Nassau, 180 F.3d 42, 53 (2d Cir. 1999) ("When a motion to dismiss is granted, the usual practice is to grant leave to amend the complaint."). However, if the court determines that an amendment would be futile because the renewed claims would not survive a motion to dismiss, it can deny leave to amend. See Oneida Indian Nation of New York v. City of Sherrill, 337 F.3d 139, 168 (2d Cir. 2003) (citing Foman v. Davis, 371 U.S. 178, 182 (1962)). With regard to plaintiff's claims against Cancellara and the Sitrick Defendants, the Court finds that leave to amend would be futile because plaintiff has already had two bites at the apple and they have proven fruitless. Melnyk, on the other hand, has not yet been afforded the opportunity to amend his counterclaims. Therefore, consistent with the liberal spirit of Rule 15(a), Melnyk has leave to amend his counterclaims to the extent he can, in good faith, cure the defects noted above.

  CONCLUSION

  For the reasons set forth above, the Court GRANTS defendants' motion to dismiss plaintiff's claims of defamation, defamation per se, tortious interference with prospective business advantage, and civil conspiracy as to defendants Cancellara, Michael S. Sitrick, and Sitrick and Company, Inc. Because the dismissal is with prejudice, the Second Amended Complaint is dismissed in its entirety as against these three defendants. Further, the Court GRANTS IN PART and DENIES IN PART plaintiff's motion to dismiss defendant Melnyk's defamation and defamation per se counterclaims. The motion is GRANTED with respect to the Payment Allegation, and thus, the statements within that allegation may not serve as a basis for the counterclaims. As to the Accounting Allegation and the Accident Allegation, the motion is GRANTED with respect to the May 19-21, 2004 Las Vegas statements because they are time-barred and DENIED with respect to the March 2005 statements. Thus, the March 2005 statements are now the only statements supporting the defamation and defamation per se counterclaims. Finally, the Court GRANTS plaintiff's motion to dismiss Melnyk's civil conspiracy counterclaim. The dismissals related to the counterclaims are without prejudice, and any amendments to the counterclaims must be served and filed no later than 21 days from the date of this Order

  SO ORDERED.

20050830

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