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Underdog Trucking, LLC v. Verizon Services Corp.

July 20, 2010


The opinion of the court was delivered by: Denise Cote, District Judge


Plaintiffs Underdog Trucking, LLC ("Underdog") and Reggie Anders ("Anders") have filed suit alleging, among other things, racial discrimination in violation of 42 U.S.C. § 1981, breach of the contract between Underdog and defendant Verizon Services Corporation ("VSC"), and libel and slander. Defendants VSC and Verizon Communications, Inc. ("VCI," and together, the "Verizon Defendants") have filed a motion to dismiss some of the claims against them. Defendants Oscar Aponte ("Aponte") and Matt Chappell ("Chappell," and together, the "Individual Defendants") have filed a motion to dismiss the entire complaint against them. For the reasons stated below, the Individual Defendants' motion is granted, and the Verizon Defendants' motion is granted in part.


The following facts, taken from the plaintiffs' April 23, 2010 "Amended Petition for Damages," are assumed to be true in deciding this motion. The "General Services Agreement Between Verizon Services Corp. and Underdog Trucking LLC" ("the Agreement"), which is described below, is integral to the complaint. See Halebian v. Berv, 590 F.3d 195, 199 (2d Cir. 2009).

Underdog is engaged in the freight and shipping industry in Arizona. Anders and his wife, both of whom are African American, own Underdog. VCI is a telecommunications company. VSC is alleged to be a subsidiary of VCI. Aponte and Chappell are employed by the Verizon Defendants as Warehouse Manager and Warehouse Supervisor, respectively.

Prior to entering into the Agreement on April 3, 2007, Underdog provided services to the Verizon Defendants on an "open account" basis. The complaint alleges that, prior to executing the Agreement, Verizon represented that "regardless of the contract terms," Verizon would keep Underdog as a contractor as long as Underdog "provided good service." The Agreement was for a term of one year, but contained an automatic renewal provision. The contract was renewed automatically on April 3, 2008, and April 3, 2009.*fn1

Plaintiffs worked for the Verizon Defendants for nearly two years without incident. The plaintiffs allege that in February 2009, Aponte and Chappell became their supervisors, and began to treat Anders and Underdog differently from other contractors. Aponte routinely referred to African Americans as "those people" or "you people;" Aponte and Chappell referred to Anders as a "token Nigger."

The complaint also alleges that Chappell and Aponte harassed Anders about the money Underdog was making from the Verizon Defendants under the Agreement and began to question Underdog's bills without reason. The Individual Defendants also demanded that Underdog cut its rates. When Underdog refused, the Individual Defendants retaliated by giving work that Underdog typically performed to two other trucking companies. Both of these companies were owned by white individuals and lacked equipment necessary to complete the work. Aponte and Chappell also retaliated by "bidding out" work that Underdog had previously performed and for which it had been compensated at the rates set by the Agreement's fee structure. The plaintiffs also allege that the Verizon Defendants, Aponte, and Chappell withheld information about the scope of potential jobs (e.g., whether a contract was for one-way or round-trip hauling) that Underdog needed in order to bid competitively. The plaintiffs complained to the Verizon Defendants about the derogatory racial remarks and reported that Aponte and Chappell were hiring less-qualified white contractors, but the Verizon Defendants denied the allegations without conducting any investigation.

The Verizon Defendants terminated the Agreement with Underdog in March 2009, but then asked Underdog to continue to work. After March 2009, Underdog received fewer and fewer work orders. At some point prior to the filing of this lawsuit, Underdog filed a claim with the Equal Employment Opportunity Commission ("EEOC"). On June 8, 2009, the EEOC issued Underdog a right to sue letter.

Plaintiffs filed the instant complaint on October 21, 2009.

The Verizon Defendants filed a motion to dismiss on February 25, 2010. At a pretrial conference on March 5, 2010, plaintiffs were given a final opportunity to amend their complaint, which they did on April 23. The Verizon Defendants renewed their motion to dismiss on April 30;*fn2 it was fully submitted on May 21.

The Individual Defendants filed their motion to dismiss the complaint for lack of personal jurisdiction and insufficient service of process on May 14; the motion was fully submitted on June 4.


I. The Individual Defendants' Motion to Dismiss

The Individual Defendants have moved to dismiss this action on the grounds that there is no personal jurisdiction over them and the plaintiffs failed to serve them. "In order to survive a motion to dismiss for lack of personal jurisdiction, a plaintiff must make a prima facie showing that jurisdiction exists." Penguin Grp. (USA) Inc. v. American Buddha, --- F.3d ----, No. 09 Civ. 1739, 2010 WL 2365545, at *4 (2d Cir. June 15, 2010) (citation omitted). Where, as here, there has been no discovery, the plaintiff need only make "legally sufficient allegations of jurisdiction" through its pleading and affidavits in order to survive a motion to dismiss. Id. (citation omitted).

"A federal court's jurisdiction over non-resident defendants is governed by the law of the state in which the court sits -- including that state's long-arm statute -- to the extent this law comports with the requirements of due process."

Arar v. Ashcroft, 532 F.3d 156, 173 (2d Cir. 2008). New York's long-arm statute, N.Y. C.P.L.R. § 302(a), provides the bases to obtain personal jurisdiction over a non-domiciliary.

The Complaint identifies Aponte and Chappell as residents of Arizona. It does not include any grounds for the assertion of personal jurisdiction in New York over either defendant. Moreover, in their opposition to the motion to dismiss filed by the Individual Defendants, the plaintiffs have identified no basis under ยง 302(a) to find that jurisdiction exists. Consequently, the motion to dismiss the claims against the Individual Defendants for lack of personal jurisdiction is granted. Given ...

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