United States District Court, E.D. New York
REPORT AND RECOMMENDATION
A. KATHLEEN TOMLINSON, Magistrate Judge.
I. PRELIMINARY STATEMENT
This litigation arises out of an alleged breach of a settlement agreement (the "Settlement Agreement") executed in July 2011 by pro se Defendant Mona Mustafa ("Defendant" or "Mustafa") and Plaintiff NSI International, Inc. ("Plaintiff" or "NSI"). See generally First Amended Complaint ("FAC") [DE 9]; FAC, Ex. A (July 2011 "Agreement and Release"). The Defendant is a former employee of Plaintiff NSI whose employment was terminated on December 12, 2008. FAC ¶¶ 3, 4; Answer [DE 25] ¶ 3. NSI asserts that any potential claims Defendant had or may have had as a result of the termination of her employment were resolved pursuant to the July 2011 Settlement Agreement. See generally FAC. In addition, NSI claims that Plaintiff failed to take certain actions required by the Settlement Agreement and took other affirmative steps which breached the Agreement. FAC ¶¶ 18-25. Based on these claims, NSI sought the following relief as outlined in the FAC: (1) a judgment against Defendant Mustafa in an amount to be determined at trial; (2) attorneys' fees and costs NSI has incurred in enforcing the settlement agreement and defending a complaint pending before the Illinois Human Rights Commission; (3) an order directing Mustafa to withdraw the complaint pending before the Illinois Human Rights Commission; (4) an order directing Mustafa to comply with the settlement agreement between her and NSI; and (5) a stay of Mustafa's matter pending before the Illinois Human Rights Commission. FAC ("Prayer for Relief").
Before the Court at this time is (1) NSI's motion for summary judgment on the single cause of action set forth in the FAC, namely, breach of contract [DE 11], and (2) Mustafa's letter motion seeking leave to file a Motion to Impose Sanctions on NSI and an additional motion to strike the complaint. See DE 30 and 48. In opposing the motion for summary judgment, Mustafa has filed her own Declaration [DE 38] and a "Statement of Undisputed Facts Pursuant to Local Rule 56.1 in Support of Plaintiff's Motion for Summary Judgment" [DE 39]. On the same date that these latter documents were filed, Mustafa also filed an "Affidavit" of her own stating that she was making the affidavit "in support of a prayer for relief that this case be referred to the appropriate authorities, including law enforcement, for a competent investigation." Affidavit of Mona Mustafa dated April 22, 2013 [DE 37], ¶3.
In a letter response dated August 29, 2013, NSI's counsel opposed Mustafa's letter motion seeking leave to file a Motion to Impose Sanctions. DE 49. In that letter, NSI's counsel argues that sanctions are not warranted, particularly in light of Defendant's actions in breaching the settlement agreement. Id. Judge Bianco has referred both motions to this Court for a Report and Recommendation. See Electronic Order, July 22, 2013; Electronic Order, Sept. 20, 2013. Having carefully considered the parties' submissions, including the parties' Local Civil Rule 56.1 Statements, as well as the applicable case law, this Court respectfully recommends to Judge Bianco that (i) Plaintiff's motion for summary judgment be GRANTED; and (ii) Defendant's request to move for sanctions and to strike the FAC be DENIED for the reasons which follow here.
The following facts are drawn from Plaintiff's Rule 56.1 Statement ("Pl.'s 56.1 Stmt.") [DE 33], Defendant's Rule 56.1 Counter-Statement ("Def.'s 56.1 Stmt.") [DE 39], and the declarations of Plaintiff's counsel, with exhibits attached ( see Decl. of Joseph M. Labuda ("Labuda Decl.") [DE 32]; see also Decl. of Jamie S. Felsen ("Felsen Decl.") [DE 40], Defendant's Affidavit in Opposition ("Def.'s Aff.") [DE 37], and Defendant's Declaration in Opposition with exhibits attached ("Def.'s Decl.") [DE 38]. Only pertinent facts are outlined here and any relevant discrepancies in the evidence are noted. Upon consideration of a motion for summary judgment, the Court construes the facts in the light most favorable to the nonmoving party. See, e.g., Capobianco v. New York, 422 F.3d 47, 50 (2d Cir. 2001). Defendant was the Vice-President of Regional Sales for NSI from June 6, 2007 until
December 12, 2008. Pl.'s 56.1 Stmt. ¶ 1; Def.'s 56.1 Stmt. ¶ 1. On December 12, 2008, NSI terminated Defendant's employment. Pl.'s 56.1 Stmt. ¶ 2; Def.'s 56.1 Stmt. ¶ 2. NSI and Mustafa, through their respective counsel, then engaged in numerous discussions in an attempt to resolve any claims Defendant may have alleged against NSI as a result of her termination. Pl.'s 56.1 Stmt. ¶ 3; Def.'s 56.1 Stmt. ¶ 3.
On or about March 5, 2009, Mustafa filed a "charge of discrimination" with the Illinois Department of Human Rights alleging discrimination in violation of the Illinois Human Rights Act based on her alleged disabilities (case number 2009CN2698). Pl.'s 56.1 Stmt. ¶ 7; Def.'s 56.1 Stmt. ¶ 7; see Charge of Discrimination, attached as Ex. F to the Labuda Decl. On March 18, 2009, NSI commenced an action against Mustafa in the New York State Supreme Court, County of Suffolk, which was subsequently removed to the United States District Court for the Eastern District of New York on April 14, 2009. Pl.'s 56.1 Stmt. ¶ 4; see Def.'s 56.1 Stmt. ¶ 4. In that action, NSI asserted claims for (i) breach of the 2009 settlement agreement; and (ii) a declaratory judgment. Pl.'s 56.1 Stmt. ¶ 5; Def.'s 56.1 Stmt. ¶ 5. Mustafa asserted a counterclaim against NSI for breach of her employment agreement. Pl.'s 56.1 Stmt. ¶ 6; Def.'s 56.1 Stmt. ¶ 6.
On August 9, 2010, Defendant withdrew her March 9, 2009 charge of discrimination (case number 2009CN2698) which was pending before the Illinois Department of Human Rights ("IDHR"). Pl.'s 56.1 Stmt. ¶ 8; Def.'s 56.1 Stmt. ¶ 8. The IDHR approved Mustafa's request to withdraw the charge and closed the file on August 9, 2010. See Order of Closure, attached as Ex. G to the Labuda Decl. However, on or about February 16, 2010, Mustafa filed a second Charge of Discrimination with the IDHR (case number 2010CF2063) alleging that NSI commenced the state court case against her in Suffolk County in retaliation for her filing the first charge of discrimination in case number 2009CN2698. Pl.'s 56.1 Stmt. ¶ 9; see Charge of Discrimination, attached as Ex. H to the Labuda Decl. Mustafa disputes the filing date for this second charge. Specifically, she claims she filed the Charge of Discrimination on September 15, 2009, and "inexplicably the Illinois Department of Human Rights did not perfect her charge for approximately five months." See Def.'s 56.1 Stmt. ¶ 7. The Court notes that the second charge to the IDHR shows February 16, 2010 as the date the charge was received by the IDHR Intake Division. Labuda Decl., Ex. H.
The IDHR issued a "Notice of Dismissal For Lack of Substantial Evidence" regarding Mustafa's retaliation charge in case number 2010CF2063. See Pl.'s 56.1 Stmt. ¶ 10; Def.'s 56.1 Stmt. ¶ 10; see IDHR Notice of Dismissal, attached as Ex. I to the Labuda Decl. Although Mustafa acknowledges the dismissal, she maintains that the dismissal was later vacated by the IDHR on August 8, 2012. Def.'s 56.1 Stmt. ¶ 10. In February 2011, Mustafa filed a Request for Review of the Illinois Department of Human Rights' determination to dismiss the retaliation charge. See Pl.'s 56.1 Stmt. ¶ 11; Def.'s 56.1 Stmt. ¶ 11; see Request for Review, attached as Ex. J to the Labuda Decl. Mustafa argued in that Request that "the charge should not have been dismissed because of errors of fact and reason." Labuda Decl., Ex. J.
NSI maintains that in order to resolve all disputes between them, Mustafa and NSI entered into the Settlement Agreement in July 2011. See Pl.'s 56.1 Stmt. ¶ 12. The Settlement Agreement was executed by Mustafa on July 15, 2011 and by NSI on July 25, 2011. Id. ; see Settlement Agreement, attached as Ex. A to the FAC; Def.'s Opp. to NSI's Mot. to Dismiss Mustafa's Complaint in Ill. Human Rights Comm'n, attached as Ex. K to the Labuda Decl, ¶ 5 (stating that, "On February 18, 2011, based upon the inexplicable February 4, 2011 dismissal, Mustafa entered into a settlement agreement... with NSI."). NSI states that under the terms of the Settlement Agreement, it agreed to pay Mustafa $60, 000, payable in three installments of $20, 000 each on July 29, August 20, and September 20, 2011, respectively. Pl.'s 56.1 Stmt. ¶ 13; see FAC, Ex. A; Labuda Decl., Ex. K, ¶ 6. Defendant asserts that "a valid, enforceable agreement does not exist, and the alleged settlement agreement, if it does exist, is void for fraud..." See Def.'s 56.1 Stmt. ¶ 12. Although Mustafa maintains that one or more of the checks may not have been timely received, she does not dispute that NSI made each of the three installment payments totaling $60, 000. See Pl.'s 56.1 Stmt. ¶ 14; Def.'s 56.1 Stmt. ¶ 14; see copies of cancelled HSBC checks issued to Mustafa's attorney, attached as Ex. L to the Labuda Decl.
NSI contends that, under the terms of the Settlement Agreement, Mustafa agreed to withdraw any claims or appeals before the IDHR, the Illinois Department of Labor, and the Eastern District federal court. Pl.'s 56.1 Stmt. ¶ 15; FAC, Ex. A. While Mustafa disputes NSI's characterization and the reasons for her continued pursuit of her claim, the parties agree that Defendant did not withdraw her request for review of the February 4, 2011 IDHR dismissal of her retaliation complaint in case number 2010CF2063. Pl.'s 56.1 Stmt. ¶ 17; Def.'s 56.1 Stmt. ¶ 17.
On August 8, 2012, the Illinois Human Rights Commission vacated the dismissal of Mustafa's Charge of Discrimination regarding the alleged retaliation, reinstated it, and remanded it to the IDHR for entry of a finding of substantial evidence. Pl.'s 56.1 Stmt. ¶ 17; Def.'s 56.1 Stmt. ¶ 17; Aug. 8, 2012 Order of Ill. Human Rights Comm'n, attached as Ex. M to the Labuda Decl.; Def.'s Decl., Ex. C, Attachment 1. Subsequently, the IDHR notified Mustafa that if she wished for the agency to file a complaint with the Illinois Human Rights Commission, she needed to notify IDHR in writing. Pl.'s 56.1 Stmt. ¶ 18; Def.'s 56.1 Stmt. ¶ 18; August 9, 2012 Notice of Substantial Evidence letter from Ill. Dep't of Human Rights, attached as Ex. N to the Labuda Decl. Mustafa points out that attorneys for NSI also received the "Notice of Substantial Evidence." Def.'s 56.1 Stmt. ¶ 18; see Labuda Decl., Ex. L.
On August 20, 2012, Mustafa requested in writing that the IDHR file a complaint with the Illinois Human Rights Commission on her behalf. Pl.'s 56.1 Stmt. ¶ 20; Def.'s 56.1 Stmt. ¶ 19; Compl. filed with Ill. Human Rights Comm'n on Sept. 28, 2012, annexed as Ex. O to the Labuda Decl., ¶ 1. NSI argues that this action constitutes a breach of the Settlement Agreement. Pl.'s 56.1 Stmt. ¶ 20. Mustafa disputes NSI's contention. Def.'s 56.1 Stmt. ¶¶ 19-20.
On September 28, 2012, the IDHR filed a complaint on Mustafa's behalf with the Illinois Human Rights Commission (ALS No. 12-0574). Pl.'s 56.1 Stmt. ¶ 21; Def.'s 56.1 Stmt. ¶ 21. NSI maintains that Mustafa repeatedly breached the Settlement Agreement by pursuing the action against NSI before the Illinois Human Rights Commission and taking numerous affirmative steps to litigate that action, as outlined more fully in Section V(C), infra. See Pl.'s 56.1 Stmt. ¶¶ 22-27. Mustafa disagrees and states that NSI failed to file a timely verified Answer to the Illinois Human Rights Commission and should have been declared in default; that Mustafa had the right to add additional parties to her complaint before the Illinois Human Rights Commission; that the Chief Legal Counsel of the Illinois Human Rights Commission changed the wording in Mustafa's Petition for Emergency Relief to deny Mustafa the necessary certification to bring the petition before this Court; and that Mustafa filed her objections to NSI's motion to dismiss the matter before the Illinois Human Rights Commission because NSI's motion should never have been permitted in the first place since it was untimely. See Def.'s 56.1 Stmt. ¶¶ 21-24, 26-27.
On March 7, 2013, the Illinois Human Rights Commission (i) dismissed Mustafa's complaint in ALS No. 12-0574, with prejudice, as barred by the Settlement Agreement; (ii) deemed the complaint frivolous; and (iii) ordered Mustafa to pay NSI's reasonable attorneys' fees and costs in defending the action. Pl.'s 56.1 Stmt. ¶ 28; Mar. 7, 2013 Recommended Liability Determination of the Ill. Human Rights Comm'n, attached as Ex. U to the Labuda Decl. Mustafa has filed objections to the recommendations of the Commission and has requested a rehearing before a different administrative law judge. Def.'s 56.1 Stmt. ¶ 28. NSI asserts that it has been damaged as a result of Mustafa's breach of the Settlement Agreement. Pl.'s 56.1 Stmt. ¶ 29; Labuda Decl. ¶ 24. Mustafa argues that NSI cannot collect attorney's fees since NSI's counsel failed to appear in the Illinois Human Rights Commission proceeding. Def.'s 56.1 Stmt. ¶ 29.
On November 8, 2012, NSI filed its Complaint in the instant action. Compl. DE 1. Shortly thereafter, NSI filed the FAC asserting a claim for breach of contract. See FAC [DE 9]. NSI requests, inter alia, that (i) Mustafa return the $60, 000 paid to her, together with attorneys' fees and costs incurred in enforcing the Settlement Agreement and defending the charge before the Illinois Human Rights Commission; and (ii) an Order directing Mustafa to comply with the Settlement Agreement. FAC ¶ 30; FAC Prayer for Relief ¶¶ 2, 4. Defendant Mustafa moved to dismiss the action [DE 7, 19]; however, Judge Bianco denied Mustafa's motion [DE 21] and set a briefing schedule for NSI's motion for summary judgment [DE 26].
After the motion for summary judgment was fully briefed, Mustafa filed a surreply. Def.'s Supp. Mem. of Law in Opp. to Pl.'s Mot. for Summary Judgment ("Def.'s Supp. Mem.") [DE 44]. NSI moved to strike the surreply as improper. DE 43. Judge Bianco denied the motion to strike, but granted NSI leave to file a surreply to Mustafa's surreply. See Electronic Order, May 16, 2013. NSI filed a further reply in support of its motion on May 30, 2013. Pl.'s Supp. Reply Letter ("Pl.'s Supp. Let.") [DE 46].
On August 22, 2013, Mustafa filed a request for leave to file a motion for sanctions and to strike the FAC based on the alleged misconduct of NSI's counsel. DE 48. NSI's counsel opposes the motion. DE 48. The motions are now ripe for review.
IV. STANDARD OFREVIEW ON SUMMARY JUDGMENT
Fed. R. Civ. P. 56(a) provides that a "court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." The moving party bears the initial burden of establishing the absence of any genuine issue of material fact. See Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256 (1986); Holcomb v. Iona Coll., 521 F.3d 130, 137 (2d Cir. 2008). To determine whether the moving party has satisfied this burden, the Court is required to view the evidence and all factual inferences arising from that evidence in the light most favorable to the nonmoving party. Doro v. Sheet Metal Workers' Int'l Ass'n, 498 F.3d 152, 155 (2d Cir. 2007); Woodman v. WWOR-TV, Inc., 411 F.3d 69, 75 (2d Cir. 2005).
Where the movant shows a prima facie entitlement to summary judgment, "the burden shifts to the nonmovant to point to record evidence creating a genuine issue of material fact." Salahuddin v. Goord, 467 F.3d 263, 273 (2d Cir. 2006). "[T]he nonmovant cannot rest on allegations in the pleadings and must point to specific evidence in the record to carry its burden on summary judgment." Id. ; see McPherson v. N.Y.C. Dep't of Educ., 457 F.3d 211, 215 n.4 (2d Cir. 2006) ("[S]peculation alone is insufficient to defeat a motion for summary judgment."); Byrnie v. Town of Cromwell, Bd. of Educ., 243 F.3d 93, 101 (2d Cir. 2001) ("Even where facts are disputed, in order to defeat summary judgment, the non-moving party must offer enough evidence to enable a reasonable jury to return a verdict in its favor."). Summary judgment is mandated if the non-moving party fails to make a showing sufficient to establish the existence of an element essential to that party's case and on which that party will bear the burden of proof at trial. Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); see Dobbs v. Dobbs, No. 06-CV-6104, 2008 WL 3843528, at *5 (S.D.N.Y. Aug. 14, 2008) ("The Court's goal should be to isolate and dispose of factually unsupported claims.") (internal quotation marks omitted).
"When the party opposing summary judgment is pro se, the Court must read that party's papers liberally and interpret them to raise the strongest arguments that they suggest.'" Ayazi v. United Fed'n of Teachers, Local 2, No. 99 CV 8222, 2011 WL 888053, at *6 (E.D.N.Y. Mar. 14, 2011) (quoting McPherson v. Coombe, 174 F.3d 276, 280 (2d Cir. 1999)). "[H]owever, a pro se party's bald assertion, completely unsupported by evidence, is not sufficient to overcome a motion for summary judgment." Ayazi, 2011 WL 888053, at *6 (citing Thompson v. Tracy, No. 00 CV 8360, 2008 WL 190449, at *5 (S.D.N.Y. Jan.17, 2008)); Chiari v. N.Y. Racing Ass'n, Inc., ___ F.Supp.2d ___, 2013 WL 4234242, at *11 (E.D.N.Y. Sept. 16, 2013). With the foregoing principles in mind, the Court now turns to an analysis of NSI's claims.
NSI's only remaining cause of action in the FAC is for breach of contract. Under New York law,  the elements of a cause of action for breach of contract are (i) the existence of a contract, (ii) performance of the contract by one party, (iii) breach by the other party, and (iv) damages suffered as a result of the breach. See Johnson v. Nextel Commc'ns, Inc., 660 F.3d 131, 142 (2d Cir. 2011) (citing Eternity Global Master Fund Ltd. v. Morgan Guar. Trust Co. of N.Y., 375 F.3d 168, 177 (2d Cir. 2004); Beautiful Jewellers Private Ltd. v. Tiffany Co., 438 Fed.App'x 20, 21-22 (2d Cir. 2011) (citing First Invs. Corp. v. Liberty Mut. Ins. Co., 152 F.3d 162, 168 (2d Cir. 1998)); J&H Holding Co., LLC v. Kloss, No. 12-CV-5738, 2013 WL 6048815, at *3 (E.D.N.Y. Nov. 13, 2013). "Under New York law, the construction of an unambiguous contract is a matter of law, appropriate for summary judgment resolution." Chevron TCI, Inc. v. Talleyrand Assocs., LLC, No. 03 Civ. 4043, 2003 WL 22977498, at *5 (S.D.N.Y. Dec. 19, 2003) (citing Adirondack Transit Lines, Inc. v. United Transp. Union, Local 1582, 305 F.3d 82, 85 (2d Cir. 2002) ("The proper interpretation of an unambiguous contract is a question of law for the court, and a dispute on such an issue may properly be resolved by summary judgment.")); see also Omni Quartz, Ltd. v. CVS Corp., 287 F.3d 61, 64 (2d Cir. 2002) (same). The Court examines below each of the four factors necessary for a breach of contract claim.
A. Whether a Contract Existed Between the Parties
NSI argues that the parties entered into a valid and binding Settlement Agreement. Mem. of Law in Supp. of Pl.'s Mot. for Summ. J. ("Pl.'s Mem.") [DE 34] at 7. Significantly, Mustafa initially acknowledges that there was in fact an agreement between the parties:
Here, there is no dispute about the existence of an agreement. Rather, the parties' disputes turn on (1) the interpretation of provisions of the Agreement and factual questions whether defendants have breached its terms. To give effect to the intent of the parties, a court must interpret a contract by considering all of its provisions and words and phrases should be given their plain meaning.... A written agreement that is clear, complete and subject to only one reasonable interpretation must be enforced according to the plain meaning of the language chosen by the contracting parties.
See Def.'s Mem. of Law in Opp. to Pl.'s Mot. for Summ. J. [DE 36] ("Def.'s Opp.") at 5 (citations and quotations omitted). Mustafa follows by setting forth a number of cases from courts in the Second Circuit which discuss ambiguity and the lack of ambiguity in contract language. See Def.'s Opp. at 6. As Mustafa moves into the "Argument" portion of her opposition, she raises contentions that certain terms of the Settlement Agreement are "confusing and ambiguous." Id. at 8. According to Mustafa, the agreement is also unenforceable due to fraud. Id. at 10. NSI points out that Defendant has previously acknowledged (i) the existence of the Settlement Agreement before ...