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Baguer v. Spanish Broadcasting System

September 20, 2007

MICHAEL BAGUER, PLAINTIFF,
v.
SPANISH BROADCASTING SYSTEM, INC., DEFENDANT.



The opinion of the court was delivered by: Kenneth M. Karas, District Judge

OPINION AND ORDER

Plaintiff Michael Baguer brings this action to recover money allegedly owed to him by his former employer, Spanish Broadcasting System, Inc. ("SBS"). The First Amended Complaint, which contains thirteen causes of action, alleges that SBS breached its employment contract with Plaintiff, discriminated against him on the basis of age, race, and national origin, and violated New York labor laws by failing to pay commissions and benefits due to Plaintiff. The First Amended Complaint also contains several contract and quasi-contract claims, including claims based on quantum meruit, tortious breach of contract, promissory estoppel, and violation of the implied covenant of good faith and fair dealing. With this Motion, SBS moves to dismiss the ninth (tortious breach of contract), tenth (promissory estoppel), and thirteenth (good faith and fair dealing) causes of action. For the reasons stated herein, the Motion is granted in part and denied in part.

I. Background

The Court will accept the following facts as true for the purposes of this Motion. Plaintiff is a fifty-five-year-old, Cuban-born, naturalized American citizen. (Am. Compl. ¶ 15.) SBS owns and operates approximately fifty radio stations, including two that are based in New York City. (Id. ¶ 14.) In January of 1996, Plaintiff was hired by SBS as an at-will employee to serve as an Account Executive, where his duties included building and maintaining relationships with advertising clients for SBS's two New York radio stations. (Id. ¶ 16.) Plaintiff allegedly performed well as an Account Executive, and by January 2003 Plaintiff was responsible for accounts worth approximately $1.1 million. (Id. ¶ 17.)

Plaintiff alleges that, despite his strong performance, SBS "determined that it wanted to use younger and more 'Anglo' sales persons to directly interface with the more important accounts." (Id. ¶ 21.) Allegedly as a result of this decision, beginning in 2003 SBS changed its policies such that individual account executives were permitted to sell to only one New York radio station, as opposed to both New York stations under the previous policy. (Id. ¶ 22.) In implementing this policy change, SBS promised that all account executives would receive equal treatment and, in particular, that Plaintiff would be provided with additional accounts in compensation for any accounts that he lost during the transition process. (Id.) However, despite SBS's promises, Plaintiff was not provided with accounts of similar value to those he lost, and ultimately Plaintiff received replacement accounts valued at only approximately $350,000. (Id. ¶ 23.) Because Plaintiff's compensation was based in large part on commissions tied to the value of his accounts, his annual compensation declined by approximately $45,000 as a result of the policy change. (Id. ¶ 26.)

On July 18, 2003, SBS fired Plaintiff and allegedly replaced him with a younger, American-born, non-Hispanic employee, who was less qualified than Plaintiff. (Id. ¶ 28.) At the time of Plaintiff's termination, SBS allegedly owed Plaintiff approximately $50,000 in commissions for the advertising that he had already sold to his clients. (Id. ¶ 30.) SBS has allegedly refused to pay this amount. (Id. ¶ 31.) As a result of SBS's actions, Plaintiff seeks compensatory and punitive damages.

II. Discussion

A. Standard of Review

SBS claims that general causes of action fail to state a claim. See Fed. R. Civ. P. 12(b)(6). The Supreme Court has recently held that "[w]hile a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the 'grounds' of his 'entitle[ment] to relief' requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell Atl. Corp. v. Twombly, 127 S.Ct. 1955, 1964-65 (2007) (citations omitted and second alteration in original). In Bell Atlantic, id. at 1964-69, the Supreme Court also abandoned reliance on the oft-cited line from Conley v. Gibson that "a complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief[,]" 355 U.S. 41, 45-46 (1957). As the Court explained, a literal application of Conley's "no set of facts" rationale is improper because "a wholly conclusory statement of claim would survive a motion to dismiss whenever the pleadings left open the possibility that a plaintiff might later establish some 'set of [undisclosed] facts' to support recovery." Bell Atl., 127 S.Ct. at 1968 (alteration in original). Instead, the Court emphasized that "[f]actual allegations must be enough to raise a right to relief above the speculative level . . . [,]" id. at 1965, and "once a claim has been stated adequately, it may be supported by showing any set of facts consistent with the allegations in the complaint[,]" id. at 1969. A plaintiff must allege "enough facts to state a claim to relief that is plausible on its face." Id. at 1974. If it "ha[s] not nudged [its] claims across the line from conceivable to plausible, [its] complaint must be dismissed." Id.; see also Iqbal v. Hasty,490 F.3d 143, 157-58 (2d Cir. 2007) ("After careful consideration of the Court's opinion and the conflicting signals from it that we have identified, we believe the Court is not requiring a universal standard of heightened fact pleading, but is instead requiring a flexible 'plausibility standard,' which obliges a pleader to amplify a claim with some factual allegations in those contexts where such amplification is needed to render the claim plausible.").

When considering a Rule 12(b)(6) motion, a court must limit itself to facts stated in the complaint, documents attached to the complaint, and documents incorporated into the complaint via reference. See Newman & Schwartz v. Asplundh Tree Expert Co., 102 F.3d 660, 662 (2d Cir. 1996) (citation omitted). The Court will accept as true Plaintiff's allegations, and draw all reasonable inferences in Plaintiff's favor. See Mills v. Polar Molecular Corp., 12 F.3d 1170, 1174 (2d Cir. 1993); Blimpie Int'l, Inc. v. Blimpie of the Keys, 371 F. Supp. 2d 469, 470-71 (S.D.N.Y. 2005). At this stage, the Court is not concerned with weighing the evidence which would be presented at trial. See Chosun Int'l Inc. v. Chrisha Creations, Ltd., 413 F.3d 324, 327 (2d Cir. 2005).

B. Plaintiff's Ninth Cause of Action

1. Tortious Breach of Contract

In his ninth cause of action, Plaintiff seeks to recover compensatory and punitive damages for what the First Amended Complaint labels "Tortious Breach of Contract." (Am. Compl. ¶¶ 95-103.) Specifically, Plaintiff alleges that SBS terminated Plaintiff's employment for "improper motives" and that "the breach of contract was so intended and planned . . . as to cease to be a mere breach of contract and become, in association with the attendant circumstances, a tortuous [sic] and wrongful act or omission." (Id. ¶ 100.) In short, the First Amended Complaint alleges that SBS's breach of contract was so malicious as to constitute a tort.

Under New York law, absent a breach of a legal duty independent of the contract itself, a plaintiff has no cause of action in tort for a breach of contract. See Orlando v. Novurania of Am., Inc., 162 F. Supp. 2d 220, 224 (S.D.N.Y. 2001) ("[A] breach of contract is not to be considered a tort unless a legal duty independent of the contract itself has been violated."); Clark-Fitzpatrick, Inc. v. Long Island R.R. Co., 516 N.E.2d 190, 193 (N.Y. 1987) ("It is a well-established principle that a simple breach of contract is not to be considered a tort unless a legal duty independent of the contract itself has been violated."). Moreover, allegations of improper motives alone will not convert a simple breach of contract into a tortious act. See Merrin Jewelry Co. v. St. Paul Fire & Marine Ins. Co., 301 F. Supp. 479, 481 (S.D.N.Y. 1969) ("[A] claim in tort does not lie on allegations of conspiracy of a party to a contract to break it, and his consequent failure to carry out the contract, in pursuance of the conspiracy, without more."); Burlew v. Am. Mut. Ins. Co., 471 N.Y.S.2d 908, 912 (App. Div. 1984) ...


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