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Jose S. Garcia v. New York Racing Association

August 29, 2011




On September 13, 2010, Jose S. Garcia ("Plaintiff" or "Garcia") filed this action alleging various civil rights violations pursuant to 42 U.S.C. §§ 1981 and 1983, as well as unlawful employment discrimination in violation of 42 U.S.C. § 2000e-2 ("Title VII") and the New York Human Rights Law (N.Y. Executive Law § 296 (McKinney 2011)) ("NYHRL"), and unlawful retaliation in the course of his employment in violation of New York Common Law. Complaint (Dkt. No. 1) ¶ 1. Garcia's Complaint names six Defendants, including: the New York Racing Association, Inc. ("NYRA"); Peter Goulet, a facilities manager at the Saratoga Race Course ("Goulet"); Chuck Dwyer, supervisor of the barn crew ("Dwyer"); Richard Koch, one of Plaintiff's managers ("Koch"); David Smuckler, Senior Vice-President for Human Resources of NYRA ("Smuckler") (collectively, "NYRA Defendants"); and the International Brotherhood of Electrical Workers, Local Union 3 ("Defendant IBEW" or "the Union"). Id. ¶¶ 10-15. Plaintiff seeks damages in accord with the provisions of N.Y. Exec. Law § 296, including back pay, front pay, compensation for the emotional harm he has suffered, and all reasonable attorneys' fees. Id. ¶¶ 139-40, 179. Plaintiff also seeks punitive damages, claiming that Defendants acted with malice and/or reckless disregard of his civil rights. Id. ¶¶ 141-42.

Plaintiff filed a complaint with the New York State Division of Human Rights ("NYSDHR") on September 10, 2009, stating that he was "discriminated against at his place of employment because he is Mexican." Id. at ¶ 3. The NYSDHR concurrently filed a complaint with the United States Equal Employment Opportunity Commission ("EEOC") on Plaintiff's behalf. Id. On July 14, 2010, NYSDHR dismissed the complaint for administrative convenience, and on July 29, 2010, the EEOC issued a notice of the right to bring suit. Id. ¶¶ 4-5.

Now before the Court are NYRA Defendants' Motion to dismiss Plaintiff's Complaint with respect to Plaintiff's First Amendment claim brought under 42 U.S.C. § 1983, and Defendant IBEW's Motion to dismiss Plaintiff's Complaint with respect to all claims against the Union. Dkt. Nos. 21, 23. Plaintiff has filed an Opposition to these Motions and Defendants have filed Responses thereto. Dkt. Nos. 30 ("Opposition"); 31 ("NYRA Response"); 32 ("IBEW Response"). For the reasons discussed below, NYRA Defendants' Motion is granted, and Defendant IBEW's Motion is denied.


A. Defendant New York State Racing Association ("NYRA")

Defendant NYRA was formed on September 12, 2008, under the New York State Not-For-Profit Corporation Law § 402 and the Racing, Pari-Mutuel Wagering and Breeding Law § 201 ("Racing Law"). Certificate of Incorporation, Def. NYRA Ex. B (Dkt. No. 21-1) at 27-33. On that same date, NYRA's predecessor, the former New York Racing Assocation ("the former NYRA"), entered into a State Settlement Agreement with the State of New York ("the State"), whereby the former NYRA conveyed its right, title, and interest in the racetrack properties to the State in exchange for $105,000,000.*fn1 State Settlement Agreement ("Settlement Agreement"), Def. NYRA Ex. D (Dkt. No. 21-1) § 2.4.

On September 12, 2008, the State also entered into a Franchise Agreement with NYRA pursuant to Racing Law § 206. Def. Ex. E (Dkt. No. 21-1) ("Franchise Agreement"). Under the Franchise Agreement, NYRA possesses the right and responsibility to manage and operate all functions at the franchised racetracks including but not limited to . . . the hiring and management of racing secretaries, stewards, race officials, backstretch employees and other equine and racing related functions, establishing the purses, the stakes program and owner's relations, maintenance of the franchise racetracks and associated facilities, the selection of vendors for food, beverage and other concessions and other activities . . . .

N.Y. Racing Law § 206(1). Furthermore, NYRA must pay the State an annual franchise fee equal to the lesser of their adjusted net income and operating case. Franchise Agreement § 2.4. The Franchise Agreement also authorizes the State to borrow itself and on behalf of NYRA to fund capital improvements at any of the Racetracks. Id. § 2.12(b). Under the Franchise Agreement, NYRA is not required to pay real estate taxes, that "being the sole and exclusive obligation and responsibility of the State." Id. § 2.14. In the event the Franchise Agreement is terminated, all of NYRA's rights, interests, and power will revert to the State. Id. §§ 206(1), 210-a(4).

NYRA currently leases its property from the State, but is solely responsible for the payment of all "impositions, utilities, and operating expenses for the Racetracks." Saratoga Race Course Ground Lease ("the Lease"), Def. NYRA Ex. F. (Dkt. No. 21-1) art. III. Under the Lease, NYRA is obligated "to repair, alter, restore, replace and rebuild" the premises in the event of a casualty, and is solely responsible for performing and incurring the costs of "all maintenance, repair and upkeep of the Leased Premises, including the Improvements thereon." Id. §§ 5.3, 11.2.

The State legislature also enacted a number of amendments or additions to the Racing Law that took effect concurrently with NYRA's reorganization under the Franchise Agreement, and are in large part incorporated into the Franchise Agreement. See, e.g., Racing Law §§ 206-10, 212, 216; Franchise Agreement §§ 2, 5, 11; see also Pl. Ex. A (Dkt. No. 30) (chart outlining statutory changes following bankruptcy of former NYRA). For instance, the Racing Law as amended grants the State Racing and Wagering Board the authority to schedule the dates and times of the races during which NYRA "may operate at the places and for the full number of days specified in its franchise." N.Y. Racing Law § 208(7); Pl. Ex. A at 1. The amendments also incorporated additional language requiring NYRA to adopt bylaws and codes to "ensure the franchised corporation is operated in an efficient and transparent manner, with the highest degree of integrity and is fully accountable to the people of the state of New York." N.Y. Racing Law § 206(4).

Moreover, the statutory amendments, also incorporated into the Franchise Agreement, established a NYRA oversight board consisting of five members appointed by the governor. Id. § 208-b; Franchise Agreement § 2.2, 2.3. Each member serves a term of four years, and the governor must designate the chair of the board, who will serve at the governor's will. N.Y. Racing Law § 208-b(1). The board is "directed and is authorized to oversee, monitor and review all transactions and operations of a non-profit racing association." Id. § 208-b(6). This power includes assessment and enforcement of NYRA's compliance with recommendations concerning: annual operating budget, operating revenues, accounting and security procedures, revenue and expenditure policies including collective bargaining agreements, vendor contracts and capital improvement plans, "performance standards," management and employee compensation plans, and governance principles for accountability and transparency. Id.; Franchise Agreement § 2.2. The board must report quarterly to the governor and legislature, and "shall utilize employees of the state racing and wagering board to carry out its duties." N.Y. Racing Law §§ 208-b(9), (12).

NYRA is further required under the Racing Law to pay a percentage of the entire wagering pool and the total balance of any unclaimed winnings to the State Department of Taxation and Finance. Id. §§ 238, 241. The State Comptroller may also "from time to time examine the books and accounts" of NYRA, including anything relating to its financial operations, and must "report the results of each audit to the governor, the legislature, the attorney general, the franchise oversight board, and the state racing and wagering board." Id. § 209. Additionally, for security purposes, NYRA is authorized to appoint special policemen for security purposes and with the powers set forth in § 2.20 of New York Criminal Procedure Law. Id. § 223.

B. Plaintiff's Complaint

Plaintiff worked for NYRA as a seasonal employee of the Saratoga Race Course in Saratoga Springs, New York, from 2001 until he was fired in August 2009. Compl. ¶¶ 16-17; 59. Plaintiff was a maintenance worker as a member of the barn crew from 2001 to 2008, and was promoted to a supervisory position for the 2009 season. Id. ¶ 17; NYRA Defendants' Memorandum of law in support of motion to dismiss (Dkt. No. 21-2) ("NYRA Mem.") at 3. Plaintiff states that while he was a maintenance worker he only occasionally worked in the detention barn,*fn2 but that it became a regular task after he was promoted to supervisor. Compl. ¶ 20. Plaintiff claims that throughout eight years of employment at the race track, he did not receive any criticism or complaints about his work performance. Id. ¶ 21. Rather, Plaintiff alleges that he was a highly regarded worker by Charles Wheeler, a facilities manager; Mike Murray, a former foreman; and Joseph Strauss, Plaintiff's former supervisor. Id. ¶¶ 24-25 ("Plaintiff's former supervisor, Joseph Strauss, said plaintiff was the best worker he had ever had.").

The events giving rise to this action began when the NYRA replaced the management team for the detention barn in 2009. Id. ¶ 26. At the beginning of the 2009 season, Plaintiff's hourly wage was $9.50, and after his promotion to supervisor that was increased to $11.50. Id. ¶ 31. Plaintiff asserts that his new supervisory position was previously held by a Caucasian Union-member employee with a grade of M-2, and that the previous supervisor was paid $23.00 per hour. Id. ¶ 32. Plaintiff further alleges that although he attempted to join the Union for three years, was promised that he would be given membership, and was recommended to the union by Joe Strauss, he was never awarded membership in the Union.*fn3 Id. ¶¶ 33, 35. According to Plaintiff, membership in the Union allows an employee to receive higher wages, health insurance, and an opportunity for a pension plan. Id. ¶ 34. Plaintiff states that there are no racial minority employees in the Union at Saratoga Race Course, but in 2009, two Caucasian male workers received Union membership at the same level at which Plaintiff was told he was eligible to join. Id. ¶¶ 36-37.

Plaintiff further claims that some of his staff received higher wages than Plaintiff did, despite their shorter tenure and more limited experience. Id. ¶ 42.

Approximately one week before Plaintiff was fired, he reported to security and to the integrity counsel*fn4 that there was "beer in the refrigerator in the break room and bottles of alcohol in the loft of the barn" in violation of the policy prohibiting all alcoholic beverages and drugs in the barn. Id. ¶ 75. Plaintiff claims that the investigators for the integrity counsel eventually found that Goulet was responsible for the infraction and that Goulet admitted to placing the alcohol in the barn. Id. ¶¶ 77-78, 155. Goulet, however, is still employed with the race track. Id. ¶¶ 77-78, 155.

Plaintiff asserts that one week following this incident, on August 24, 2009, he had become very sick on the job and had to leave. Id. ¶¶ 79, 87-88, 155. Plaintiff alleges that he attempted to call Goulet twice and Koch once to notify them that he was going home sick. Id. ¶ 89. Although neither answered Plaintiff's calls, Plaintiff alleges that he left messages for both Goulet and Koch. Id. ¶¶ 89-90. Plaintiff also claims that an hour after he left work, Goulet allegedly returned Plaintiff's call and voiced consent to Plaintiff's leaving work. Id. ¶¶ 92-93. The Complaint states that approximately an hour and a half after Plaintiff left work on August 24, 2009, Koch informed an employee on Plaintiff's staff, that Plaintiff had been fired by Goulet. Id. ¶ 94. That employee subsequently informed Plaintiff that his employment was terminated. Id. ¶ 96.

Plaintiff states that he contacted NYRA's investigators and integrity counsel after learning that he was fired. Id. ¶ 98. At a meeting with the counsel, on Wednesday, August 26, 2009, Plaintiff informed two investigators of the circumstances surrounding his firing. Id. ¶ 100 The investigators spoke to Koch, who said that he did not know whether Plaintiff was actually fired. Id.

¶ 101. Following the meeting with the integrity counsel, Plaintiff allegedly went to the maintenance office to speak with Goulet. Id. ¶ 102. Although Goulet was not there, Koch was, and he informed Plaintiff that he was fired and instructed him to turn in his keys and badge. Id. ¶¶ 103-104. Koch also allegedly told Plaintiff that he did not know why Plaintiff was fired, but that he would speak with Goulet. Id. ¶ 105. Plaintiff claims that he finally communicated with Goulet at the end of the day, and Goulet confirmed that Plaintiff was fired but provided no reason for the termination. Id. ¶¶ 110-112.

Plaintiff states that on Thursday, August 27, 2009, he attended a meeting with Goulet, Smuckler, a woman named Chrystal,*fn5 Koch, and two women Plaintiff did not know, where his employment termination was confirmed. Id. ¶¶ 113-114. The reason provided for his termination was "job abandonment," because he had left work on August 24, 2009, without informing anyone and did not attend work the following day. Id. ¶ 115. One of the women stated that Plaintiff did not know he had been fired on August 24, and therefore should have attended work the next day. Id. ¶ 117. Plaintiff accused them of lying, and Smuckler ...

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