United States District Court, E.D. New York
[Copyrighted Material Omitted]
Joseph P. Asselta, Agovino & Asselta, LLP, Mineola, NY, for Plaintiff.
Paul A. Alongi, Alongi & Associates, LLC, Parsippany, NJ, for Defendants.
GLASSER, Senior District Judge.
Plaintiff Prestige Builder & Management LLC (" Prestige" or " plaintiff" ), a New York-based subcontractor, brings this diversity action against several California-based employees of Triton Structural Concrete Incorporated (" Triton" ), a general contractor, and Triton's surety, Safeco Insurance Co. of America (" Safeco," collectively " defendants" ), seeking payment for work completed as part of the construction of a New York City Department of Parks and Recreation (" Parks Department" ) amphitheater in Harlem's Marcus Garvey Park. Prestige seeks $134,927.66 for a payment bond executed by Safeco, as surety for Triton, issued to the City of New York in connection with the project. It also asserts fraud claims against Triton employees Mary Anne Wilson, Elaina Gallegos, and Debra Peterson (the " individual defendants" ), alleging that they falsely certified and submitted to the Parks Department forms stating that there were no funds due to any subcontractors who worked on the project when, in fact, $134,927.66 remained due and owing to Prestige.
Currently before the Court is defendants' motion to dismiss the fraud claims against the individual defendants pursuant to Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure. For the reasons set forth below, defendants' motion is hereby DENIED.
The following facts are taken from Prestige's complaint and are accepted as true for purposes of this motion. On or about April 2010, Triton entered into a contract with the Parks Department to serve as a general contractor for the construction of an amphitheater at the Pelham Fritz Recreation Center in Harlem's Marcus Garvey Park (the " project" ). Complaint dated Apr. 16, 2012 ¶ 10 (" Compl." ) (Dkt. No. 1). Safeco, as surety for Triton, executed and delivered a payment bond to the City of New York, binding itself to pay all of those who worked on the project.
Prestige was one such subcontractor and, on or about June 11, 2010, it entered into two contracts with Triton, one to perform " stage framing work" and the other to perform " wood frame construction work" as part of the project. Id. ¶¶ 12-13. Between approximately January 1, 2011 and May 25, 2011, Prestige performed its work under the agreements and regularly billed Triton for it. Id. ¶¶ 47-48. In the intervening months, Prestige avers, several of Triton's employees falsely certified and submitted to the Parks Department forms dealing with work completed for various laborers on the project, including Prestige. Id. ¶¶ 25, 37, 49.
On or about March 9, 2011, Mary Anne Wilson (" Wilson" ), Triton's controller, certified and submitted to the Parks Department a " Certificate of Contractor to the Controller or Financial Officer of the City of New York Form 42" (" Form 42" ) that
contained false statements that there were no monies due and owing laborers on the project and that failed to identify Prestige as a subcontractor performing work as part of the project. Id. ¶¶ 25, 27. Next, on or about May 18, 2011, Elaina Gallegos (" Gallegos" ), an accounts payable manager at Triton, certified and submitted to the Parks Department a " Certificate of Contractor to the Controller or Financial Officer of the City of New York Form 44" that contained false statements regarding the amount of work performed by Prestige and that failed to identify any amounts due to Prestige under the agreements. Id. ¶ 37. Finally, on May 25, 2011, Debra Peterson (" Peterson" ), Triton's manager, certified and submitted to the Parks Department a separate Form 42 that contained the same false information as the first Form 42. Id. ¶ 49. During the period these individuals submitted the forms to the Parks Department, however, Triton still owed Prestige $134,927.66 for work completed pursuant to the parties' agreements. Id. ¶¶ 27, 39, 51. As a result of these statements, the Parks Department made payments to Triton under their agreement that included money due to Prestige. Id. ¶ 30, 42, 54.
Prestige initiated this action on April 20, 2012, asserting a claim under N.Y. Finance Law § 137 against Safeco  and fraud claims against Wilson, Gallegos, and Peterson. Defendants, on May 15, 2012, filed their motion to dismiss the fraud claims against the individual defendants. Defendants move to dismiss the complaint on several grounds, arguing that Prestige lacks standing to assert its claims and fails to plead a cause of action for fraud. Memorandum of Law in Support of Defendants' Motion to Dismiss dated May 15, 2012 (" Defs.' Mem." ) at 1-2 (Dkt. No. 3). On June 12, 2012, Prestige filed its papers in opposition to defendants' motion, Memorandum of Law in Opposition to Defendants' Motion to Dismiss dated June 12, 2012 (" ...