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ZIKAKIS v. STAUBACH RETAIL SERVICES

September 22, 2005.

CHRISTOPHER ZIKAKIS, Plaintiff,
v.
STAUBACH RETAIL SERVICES, INC., PRESIDIO FINANCIAL PARTNERS, LLC, iSTAR FINANCIAL INC., and AUTOSTAR REALTY OPERATING PARTNERSHIP L.P., Defendants.



The opinion of the court was delivered by: NAOMI BUCHWALD, District Judge

MEMORANDUM AND ORDER

Christopher Zikakis ("Zikakis" or "plaintiff") brings this diversity action against Staubach Retail Services, Inc. ("SRS"),*fn1 Presidio Financial Partners, LLC ("Presidio"), iStar Financial Inc. ("iStar") and Autostar Realty Operating Partnership L.P. ("Autostar") (collectively, "defendants") alleging that defendants improperly used plaintiff's novel idea of forming a real estate investment trust comprised of sale-leaseback transactions within the automotive retailing industry. Defendants have moved to dismiss plaintiff's complaint for failure to state a claim under Fed.R.Civ.P. 12(b)(6). For the reasons set forth below, defendants' motion is granted in its entirety. BACKGROUND*fn2

I. Plaintiff's Communications with Staubach, iStar and Presidio

  Zikakis contacted Staubach, a real estate advisory firm that specializes in investment and financing transactions involving commercial properties nationwide, after learning that Staubach had formed a separate company aimed at providing advisory services to automotive manufacturers and dealers. Knowing that Staubach's existing business consisted in part of facilitating "sale-leaseback transactions," Zikakis contacted Staubach and related to it an idea to form a real estate investment trust ("REIT") "comprised of sale-leaseback transactions within the automotive retailing industry." Compl. ¶ 10. According to the complaint, between December 2002 and March 2003, Zikakis and various Staubach representatives engaged in several meetings at which Zikakis "explained in detail his analysis of why the risks and rewards of sale-leaseback transactions within the automotive retailing industry were attractive as compared to those found in other industries." Id. ¶ 11.

  On several occasions, Zikakis met with Staubach's president and C.E.O., Christopher Maguire, to further discuss the REIT idea. Following one such meeting in New York City on June 6, 2003, Zikakis sent to Maguire a "detailed memorandum describing the investment rationale for automobile dealership sale-leaseback transactions." Id. ¶ 14.

  On June 28, 2003, Maguire sent Zikakis an e-mail stating that Zikakis was "the right person to help lead (Staubach] in this area" and suggesting that Zikakis work with Staubach on a "contract basis" until Staubach raised sufficient capital to fund the business venture that Zikakis had proposed to Maguire. Id. ¶ 15. Allegedly as an inducement to encourage Zikakis to share his ideas further with Staubach, Maguire told Zikakis that it was Staubach's "customary practice" to form independent companies with partners who came to own and operate individual businesses and that Maguire envisioned a similar "partnership" with Zikakis. Id. ¶¶ 16, 17.

  After these conversations, Zikakis engaged in further communications with Maguire in which Zikakis indicated that, although he expected eventually to have a stake in the proposed venture, he was amenable to entering into an "interim relationship" on a "contract basis" with Staubach until the business plan "was more fully developed." Id. ¶ 18. After this conversation, Maguire told Zikakis that Staubach would provide Zikakis the "next week" with a "term sheet" that would describe "proposed terms of a business relationship" between Staubach and Zikakis. Id. ¶ 19. The "term sheet" did not arrive the next week, and when Zikakis inquired about it, he was told that it would be provided the following week. According to the complaint, this "pattern of delays" continued for several weeks thereafter. Id. ¶ 19. In the meantime, however, on July 17, 2003, Zikakis introduced Maguire to Barclay Jones, who was affiliated with iStar, a potential source of capital for the proposed venture.

  Subsequent to the meeting with Jones, Maguire allegedly continued to "promise?" Zikakis that a proposed contract was forthcoming. Id. ¶ 19. Zikakis, at Maguire's request, then called an individual named Brodie Cobb, a managing director at Presidio, a potential future partner. During that conversation, Cobb questioned Zikakis about Zikakis's "transactional experience" and then concluded the call. After the call, Zikakis never heard again from Maguire or Cobb, despite his repeated attempts to contact them.

  II. The Formation of Autostar

  Several months later, Zikakis learned that Staubach, iStar and Presidio had formed Autostar, a REIT "comprised of sale-leaseback transactions within the automobile retailing industry." Id. ¶ 27. The complaint alleges that a July 23, 2004 press release describing the formation of Autostar "parrot[ed] Zikakis' business proposal from June 2003." Id. ¶ 28. III. Plaintiff's Complaint

  On December 7, 2004, plaintiff filed his complaint in this action, asserting seven claims. Claim One alleges that defendants misappropriated plaintiff's idea of forming a REIT comprised of sale-leaseback transactions within the automotive retailing industry. Claim Two alleges that Presidio tortiously interfered with Zikakis's prospective economic gain by "discredit[ing] Zikakis's experience and reputation, and engag[ing] in acts designed to exclude Zikakis from any future business relationship with Staubach." Id. ¶ 25. Claims Three through Five assert that defendants are liable to Zikakis as a result of the conduct described above on theories, respectively, of quantum meruit, promissory estoppel and unjust enrichment. Claims Six and Seven are demands for equitable relief via accounting and constructive trust.

  Defendants have moved to dismiss the complaint in its entirety on the ground that plaintiff has failed to state a claim upon which relief can be granted. For the reasons discussed below, we agree.

  DISCUSSION

  In considering a motion to dismiss, the Court must accept as true all material factual allegations in the complaint. Levy ex rel. Immunogen Inc. v. Southbrook Int'l Invs., Ltd., 263 F.3d 10, 14 (2d Cir. 2001). However, "[c]onclusory allegations or legal conclusions masquerading as factual conclusions will not suffice to prevent a motion to dismiss." Smith v. Local 819 I.B.T. Pension Plan, 291 F.3d 236, 240 (2d Cir. 2002) (quoting Gebhardt v. Allspect, Inc., 96 F. Supp. 2d 331, 333 (S.D.N.Y. 2000)). A motion to dismiss may be granted only where "it appears beyond doubt that the plaintiff can prove no set of facts ...


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