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Amber and Nuha Jadama v. Keycorp

June 14, 2011


The opinion of the court was delivered by: David N. Hurd United States District Judge



Plaintiffs Amber Jadama ("Amber") and her husband Nuha Jadama ("Nuha") (collectively "plaintiffs") bring this action alleging: (1) race discrimination in violation of the Fourth and Fourteenth Amendments to the United States Constitution and 42 U.S.C. § 1981; (2) conspiracy in violation of 42 U.S.C. §§ 1985 and 1986; and (3) pendent state law claims for discrimination, negligence, and intentional infliction of emotional distress. Dkt. No. 1.

Defendants have moved for dismissal pursuant to Federal Rule of Civil Procedure 12(b)(6). Dkt. No. 5. Although plaintiffs oppose the motion, they did not file a memorandum of law opposing defendant's legal arguments for dismissal. Instead, plaintiffs have cross-moved for leave to amend the complaint pursuant to Rule 15(a).*fn1 Dkt. No. 7. Defendant filed a reply in further support of its motion to dismiss and in opposition to the cross-motion. Dkt. No. 13. The motions were considered on submit.


The following facts are taken from the original complaint. Plaintiffs are "foreigners from India and Gambia." On September 6, 2010, they opened a joint checking account at defendant's bank branch located in Johnstown, New York. The following day Amber received a phone call from defendant's representative, Steven Christian ("Christian"), who advised that the bank was closing their account because Amber "was married to a terrorist" and to continue the business relationship would be "aiding terrorism." On September 16, 2010, plaintiffs received a $50.00 check by mail from defendant, representing the return of their checking account deposit.


As plaintiffs seek leave to amend the complaint, their motion will be addressed first.

A. Plaintiffs' Cross-Motion to Amend

Plaintiffs seek to amend their complaint to: (1) clarify their race, nationality, citizenship, and other factual allegations in the existing causes of action; (2) add a cause of action under 42 U.S.C. § 1982; (3) withdraw the cause of action under New York Civil Rights Law § 40; and (4) add KeyBank National Association ("KeyBank"), KeyCorp's subsidiary, as a defendant. Defendant argues that the motion to amend should be denied as futile because all causes of action in the proposed amended complaint fail to state a plausible claim.

Leave to amend should be freely given "when justice so requires." Fed. R. Civ. P. 15(a)(2). However, "[a] district court has discretion to deny leave for good reason, including futility, bad faith, undue delay, or undue prejudice to the opposing party." McCarthy v. Dun & Bradstreet Corp., 482 F.3d 184, 200 (2d Cir. 2007). An amendment to a complaint is futile if the proposed claim would not withstand a motion to dismiss. Dougherty v. Town of N. Hempstead Bd. of Zoning Appeals, 282 F.3d 83, 88 (2d Cir. 2002).

To survive a motion to dismiss, the "[f]actual allegations must be enough to raise a right to relief above the speculative level." Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S. Ct. 1955, 1965 (2007). Although a complaint need only contain "a short and plain statement of the claim showing the pleader is entitled to relief" (Fed. R. Civ. P. 8(a)(2)), more than mere conclusions are required. Indeed, "[w]hile legal conclusions can provide the framework of a complaint, they must be supported by factual allegations." Ashcroft v. Iqbal, ___ U.S. ___, 129 S. Ct. 1937, 1950 (2009).

Dismissal is appropriate only where plaintiffs fail to provide some basis for the allegations that support the elements of their claims. See Twombly, 550 U.S. at 570, 127 S. Ct. at 1974 (requiring "only enough facts to state a claim to relief that is plausible on its face"). When considering a motion to dismiss, the complaint is to be construed liberally, and all reasonable inferences must be drawn in the plaintiffs' favor. Chambers v. Time Warner, Inc., 282 F.3d 147, 152 (2d Cir. 2002).

1. Claims Against KeyCorp

Defendant argues that KeyCorp is not a proper defendant in this action. In their proposed amended complaint, plaintiffs seek to add KeyBank as a defendant. Defendant explains that KeyCorp is a holding company for KeyBank, a national banking association. Defendant maintains that KeyCorp must be dismissed because, as a parent company, it cannot be held liable for the acts of its subsidiary.

Generally, "a corporate relationship alone is not sufficient to bind a parent corporation for the actions of its subsidiary." DeJesus v. Sears, Roebuck & Co., 87 F.3d 65, 69 (2d Cir. 1996) (internal quotation marks and alterations omitted). In order to hold a parent company liable for the acts of its subsidiary, "plaintiffs must come forward with the showing of actual domination required to pierce the corporate veil." Id. at 70 (internal quotation marks omitted).

Plaintiffs fail to put forth any factual allegations to plausibly suggest KeyCorp exercised "actual domination" over KeyBank. There is no indication that KeyCorp employees shaped or implemented KeyBank's policies. All communications with plaintiffs involved representatives of the KeyBank branch in Johnstown, New York. The only factual allegations specific to KeyCorp is that it is headquartered in Ohio and is the parent company of KeyBank. However, plaintiffs allege that "KeyBank, as a principal subsidiary of defendant, KeyCorp, is responsible for the organization and management of branch locations" including the branch located in Johnstown. Dalmata Affirm., Ex. D, Dkt. No. 7-3, ΒΆ 14 ("Proposed Amended Complaint"). Such allegations fall far short of establishing KeyCorp's "actual domination" over KeyBank. See McAnaney v. Astoria Fin. Corp., 665 F. Supp. 2d 132, 145 (E.D.N.Y. 2009) (parent ...

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