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Idearc Media LLC v. Siegel

January 16, 2012


The opinion of the court was delivered by: William M. Skretny Chief Judge United States District Judge



Plaintiff commenced this diversity action seeking breach of contract damages in excess of $500,000 resulting from Defendant's failure to pay an account balance for advertising in Verizon print directories published by Plaintiff. Pending before this Court are Plaintiff's Motion to Strike and Dismiss the Amended Answer with Counterclaim and to Strike the Jury Demand, (Docket No. 19), and Defendant's Cross-Motion to Dismiss Plaintiff's Motion or, alternatively, for leave to file an Amended Answer (Docket No. 24). Also pending before this Court is Plaintiff's Motion to Supplement its Reply in further support of its Motion to Dismiss and in opposition to Defendant's Cross-Motion (Docket No. 28). For the reasons discussed below, however, this Court determines that this matter is fully briefed without need for any supplement, and oral argument is not necessary.


Plaintiff, a Delaware corporation with its principal place of business in Texas, is a publisher of Verizon print directories, and Defendant, a New York limited liability law firm located in Buffalo, has purchased advertising in those directories on multiple occasions since 2004. (Complaint, Docket No. 1, ¶¶ 1, 7, 9, 13, Ex A; Answer, Docket No. 8, ¶¶ 7, 9, 13). Plaintiff alleges that Defendant's account has not been current since that time. (Complaint ¶ 14). The parties entered into a Payment Arrangement Proposal on September 18, 2009, in order to "resolve the delinquent yellow pages advertising balance on the account[]." (Complaint ¶15, Ex C; Answer ¶ 15). Dominic Caravello was listed in the agreement as the sales representative for Plaintiff, and Dennis Kahn was listed as the contact for Defendant. (Complaint, Ex C). The Payment Arrangement Proposal provided for Defendant to make six equal payments of $85,492.68 between October 18, 2009 and March 18, 2010, with any additional monthly billing charges paid in accordance with Plaintiff's standard contract payment terms. (Complaint, Ex C). This agreement was signed on behalf of Defendant by Kahn. (Complaint, Ex C). Defendant failed to make the first payment scheduled pursuant to the Payment Arrangement Proposal for October 18, 2009, and failed to tender any payment in response to Plaintiff's correspondence about the delinquency in November 2009. (Complaint ¶¶ 17, 20; Answer ¶¶ 17, 20).

Plaintiff commenced the instant action in this Court on December 23, 2009, alleging causes of action for breach of contract and account stated. (Complaint ¶¶ 13-37). Attached to the Complaint were agreements for advertising services, denominated "Application[s] for Advertising Services," from 2006 through 2008. (Complaint, Ex A). Defendant filed and served its original Answer on March 2, 2010, (Answer, Attach 3), and filed a jury demand on March 8, 2010. (Docket No. 11). On May 28, 2010, Defendant filed an Amended Answer, wherein Defendant asserts for the first time Plaintiff's alleged failure to mitigate damages as an affirmative defense and a fraudulent inducement counterclaim. (Amended Answer ¶¶ 44-55). With respect to the counterclaim, Defendant specifically alleges that "Caravello made oral representations to [Defendant] that payment of fees for advertising could be deferred until [Defendant] was able to make such payments." (Amended Answer ¶ 49). In reliance upon these alleged representations, Defendant entered into advertising contracts with Plaintiff. (Amended Answer ¶ 50). Defendant further alleges that when Plaintiff made a demand for full payment on the account in September 2009, "Caravello, again, represented to [Defendant] that this was a formality and that payment could proceed pursuant to the deferred arrangement that had been mutually agreed upon between Mr. Caravello and [Defendant]." (Amended Answer ¶¶ 52-53).


A. The Amended Answer

Plaintiff moves pursuant to Rules 9(b), 12 (b)(6), and 15 (a) of the Federal Rules of Civil Procedure for an order striking and dismissing with prejudice the Amended Answer with counterclaim.*fn1 (Docket No. 19). Plaintiff also requests leave to supplement its reply to Defendant's Cross-Motion seeking, inter alia, leave to amend its Answer.*fn2 (Docket No. 28). Initially, Plaintiff is correct that Defendant's amendment of its answer without leave of the Court was untimely inasmuch as the Amended Answer was filed more than 21 days after Defendant served the original Answer.

See Fed. R. Civ. P. 15 (a)(1)(A); (a)(2). Defendant concedes as much, (Def's Mem. of Law, Docket No. 24-2, at 6), but nonetheless argues that the Proposed Discovery Plan, filed April 27, 2010, and signed by each party's counsel, constituted "the opposing party's written consent" to an amended filing pursuant to Fed. R. Civ. P. 15 (a)(2). Specifically, defendant points to the language in the Proposed Discovery Plan that " '[a]ll motions to join other parties and to amend the pleadings shall be filed on or before May 28, 2010.'" (Def's Mem. of Law, Docket No. 24-2, at 7 (emphasis in original), quoting Docket Nos. 14; 24-3, Ex 1, ¶ 5 (Proposed Discovery Plan)). Notably, however, the original Answer was served on March 2, 2010, (Docket No. 8-3), thus the 21-day period wherein Defendant could permissibly amend its answer as a matter of course expired on March 23, 2010. Because no pleading could have been amended without leave of this Court at the time the Proposed Discovery Plan was filed on April 27, 2010, (Docket No. 14), this joint submission of the parties clearly requires that all motions for leave to amend the pleadings be filed on or before May 28, 2010. The Amended Answer was thus untimely and improperly filed without leave of this Court, and is therefore without legal effect. See generally United States ex rel. Mathews v. HealthSouth Corp., 332 F.3d 293, 296 (5th Cir. 2003)("failure to obtain leave results in an amended [pleading] having no legal effect"); Gaumont v. Warner Bros. Pictures, 2 F.R.D. 45, 46 (S.D.N.Y. 1941)(same); but see Little v. Nat'l Broad. Co., Inc., 210 F.Supp.2d 330, 372 (S.D.N.Y. 2002)(some courts have considered untimely amended pleadings if leave would have been granted and in the absence of prejudice to any party).

Defendant requests in the alternative that the Court grant leave to amend the Answer. (Def's Mem. of Law, Docket No. 24-2, at 13-14). Generally, leave to amend a pleading shall be freely given when justice so requires. Fed. R. Civ. P. 15 (a) (2). Nonetheless, it is in the sound discretion of this Court "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); see Foman v. Davis, 371 U.S. 178, 182, 83 S.Ct. 227, 9 L.Ed.2d 222 (1962). Plaintiff responds that leave to amend should be denied because the counterclaim is futile. (Pl's Reply Mem. of Law, Docket No. 25, at 2-8). An amendment is considered futile if the amended pleading would not survive a motion to dismiss, either pursuant to Rule 12 (b)(6) or on some other basis. Dougherty v. Town of North Hempstead Bd. of Zoning Appeals, 282 F.3d 83, 88 (2d Cir. 2002); McKinney v. Eastman Kodak Co., 975 F. Supp. 462, 465 (W.D.N.Y. 1997). A court considering such a motion to dismiss applies: a "plausibility standard," which is guided by "[t]wo working principles," Ashcroft v. Iqbal, --- U.S. ----, 129 S.Ct. 1937, 1949, 173 L.Ed.2d 868 (2009).

First, although "a court must accept as true all of the allegations contained in a complaint," that "tenet" "is inapplicable to legal conclusions," and "[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice." Id. "Second, only a complaint that states a plausible claim for relief survives a motion to dismiss," and "[d]etermining whether a complaint states a plausible claim for relief will ... be a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 1950.

Harris v. Mills, 572 F.3d 66, 72 (2d Cir. 2009); see also Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007), Mortimer Off Shore Services, Ltd. v. Federal Republic of Germany, 615 F.3d 97, 114 (2d Cir. 2010), cert denied __ U.S. __, 131 S.Ct. 1502, 179 L.Ed.2d 360 (2011). "A claim has facial plausibility when the [the party asserting a claim or counterclaim] pleads factual content that ...

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