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Frenkel v. New York City Off-Track Betting Corp.

May 4, 2009

ZOLTAN FRENKEL, PLAINTIFF,
v.
NEW YORK CITY OFF-TRACK BETTING CORPORATION, DEFENDANT.



The opinion of the court was delivered by: Andrew J. Peck, United States Magistrate Judge

OPINION AND ORDER

After the close of discovery and the filing of defendant's summary judgment motion, plaintiff Zoltan Frenkel moves to amend his complaint to add a fifth cause of action asserting that defendant OTB undermined a 2004 "federal settlement agreement"*fn1 that resolved a previous litigation between Frenkel and OTB. (Dkt. No. 26: Notice of Motion; Dkt. No. 27: Weinreb Aff. Ex. A: Proposed 2d Am. Compl. ¶¶ 54-67.) OTB objects to the amendment, claiming that amendment would be futile and that OTB would be prejudiced by the amendment. (Dkt No. 32: OTB Opp. Br. at 2, 5-7; Dkt. No. 44: OTB Surreply Br. at 2, 4-6.) For the reasons set forth below, Frenkel's motion for leave to amend his complaint is DENIED as futile.

BACKGROUND

On January 16, 2008, Frenkel commenced an action against OTB in Supreme Court, New York County, alleging breach of contract and religious discrimination and retaliation under the New York City Human Rights Law. (Dkt. No. 31: Capell Aff. Ex. A: 1/16/08 State Compl.) On March 21, 2008, OTB moved to dismiss Frenkel's complaint pursuant to CPLR § 3211(a)(7) on the ground that Frenkel had failed to comply with § 618 of New York's Racing, Pari-Mutuel Wagering and Breeding Law, which requires that "an action against the [New York City Off-Track Betting] corporation shall not be commenced . . . unless a notice of claim . . . ha[s] been served upon the corporation within ninety days after such cause of action shall have accrued." N.Y. Rac. Pari-Mut. Wag. & Breed. L. § 618(5). (See Capell Aff. Ex. B: 3/21/08 OTB Mot. to Dismiss Papers.)

On June 6, 2008, Frenkel opposed OTB's motion, attaching an amended complaint, which Frenkel argued "correct[ed] all the objections that had been raised by Defendant . . . . by removing the state law claims and replacing them with a claim under federal law, § 1983," because "[s]tate notice of claim provisions[] are not applicable to [Frenkel]'s civil rights claims asserted under 42 U.S.C. § 1983." (Capell Aff. Ex. D: Frenkel Opp. Br. at 2-4; see Capell Aff. Ex. C: Am. Compl.) The proposed complaint asserted three causes of action under § 1983 -- equal protection, retaliation and breach of contract -- as well as a claim of First and Fourteenth Amendment violations. (See Capell Aff. Ex. C: Am. Compl.)

On July 2, 2008, OTB removed the action to the Southern District of New York based on the amended complaint's §1983 claims, which created federal jurisdiction. (See Dkt. No. 1: Notice of Removal.) On November 7, 2008, Judge Swain ordered that "[a]ll applications to amend pleadings or join parties, or amendments or joinders as of right, shall be made by December 5, 2008." (Dkt. No. 15: 11/7/08 Pre-Trial Scheduling Order ¶ 1.) Judge Swainalso ordered that all discovery be completed by March 25, 2009" (id. ¶ 2), which this Court extended to April 3, 2009 (see 3/6/09 Tr.), with summary judgment motions due April 24, 2009 (see 11/7/08 Pre-Trial Scheduling Order ¶ 3; 3/30/09 Tr. at 15).

On April 8, 2009, five days after the close of discovery, Frenkel filed the instant motion pursuant to Fed. R. Civ. P. 15(a) seeking leave to amend the complaint. (Dkt. Nos. 24 & 26: Notice of Motion; Dkt. No. 27: Weinreb Aff. Ex. A: Proposed 2d Am. Compl.) Frenkel's proposed second amended complaint would add a fifth cause of action alleging that OTB undermined a "so ordered" 2004 "federal settlement agreement"*fn2 when OTB management tacitly approved "ongoing harassment by [Frenkel's] supervisors and co-workers" after making "it obvious to employees that [Frenkel's] promotion was a forced promotion," which had the "effect of undermining the federal settlement agreement pursuant to which the Employer was obligated to make [Frenkel] a supervisor." (Weinreb Aff. Ex. A: Proposed 2d Am. Compl. ¶¶ 54-64.) In addition, the proposed fifth cause of action alleges that OTB "violated the terms of the federal settlement agreement" when it failed to retroactively increase Frenkel's "salary pursuant to the settlement in the amount of $19,999.99," and when it failed to "provide [Frenkel] with overtime opportunities on an equal basis with other employees." (Proposed 2d Am. Compl. ¶¶ 65-66.)*fn3

ANALYSIS

OTB objects to the amendment, arguing that Frenkel's "proposed fifth cause of action is a state law claim for breach of contract," which "must be denied [as futile] because [Frenkel] has thoroughly failed to comply with the Notice of Claim requirements under § 618 of the Racing Law." (Dkt. No. 32: OTB Opp. Br. at 5-6.) OTB also argues that it "would be meaningfully prejudiced by amendment of the complaint at this late stage," because "OTB did not conduct any discovery on this claim," which places OTB at a "significant disadvantage in defending against this claim" and in "timely submit[ting] a Motion for Summary Judgment." (OTB Opp. Br. at 6-7.)*fn4

This Court's opinion in Turkenitz v. Metromotion discusses the law concerning proposed amendments after the close of discovery:

Rule 15(a) of the Federal Rules of Civil Procedure instructs that "leave [to amend] shall be freely given when justice so requires."

Analysis of any motion to amend starts with the Supreme Court's decision in Foman v. Davis, 371 U.S. 178, 83 S.Ct. 227 (1962):

Rule 15(a) declares that leave to amend 'shall be freely given when justice so requires'; this mandate is to be heeded. If the underlying facts or circumstances relied upon by a plaintiff may be a proper subject of relief, he ought to be afforded an opportunity to test his claim on the merits. In the absence of any apparent or declared reason -- such as undue delay, bad faith or dilatory motive on the part of the movant, repeated failure to cure deficiencies by amendments previously allowed, undue prejudice to the opposing party ...


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