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Excellent Home Care Services, LLC v. FGA, Inc.

United States District Court, E.D. New York

August 27, 2014

EXCELLENT HOME CARE SERVICES, LLC, Plaintiff,
v.
FGA, INC., Defendant.

MEMORANDUM AND ORDER

I. LEO GLASSER, Senior District Judge.

Plaintiff Excellent Home Care Services, LLC ("EHCS") brings this action against FGA, Inc. ("FGA"), alleging breach of contract and negligent breach of duty. FGA moves to dismiss EHCS's complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). The motion is GRANTED.

BACKGROUND

The following facts are taken from EHCS's complaint and other documents the Court may consider in ruling on this motion. EHCS is a home healthcare company based in New York and FGA is a billing-management company based in New Jersey. In May 2007, the companies entered into an "Agreement" pursuant to which EHCS outsourced all of its billing of health-insurance companies to FGA. EHCS alleges that although it fulfilled all of its duties under the agreement, "FGA failed, neglected and omitted to fulfill the obligations imposed upon it pursuant to the Agreement in that it, among other things, failed to timely and or properly submit EHCS's claims to the Providers causing the claims to be denied payment." EHCS also alleges that FGA breached a duty it owed to EHCS independent of the contract by failing to timely and properly submit the claims.

EHCS filed suit in the New York Supreme Court, Kings County, on August 28, 2013, by filing a summons and notice, seeking $6, 000, 000 for breach of contract and fraud. On September 27, 2013, before EHCS filed a complaint, FGA removed the action to this Court on the basis of diversity jurisdiction. On October 30, 2013, EHCS filed its complaint, again claiming breach of contract, replacing its claim of fraud with one for negligent breach of duty, and increasing its demand to $7, 000, 000.

FGA moved to transfer the action to New Jersey on November 15, 2013, which this Court denied on February 19, 2014. FGA moved to dismiss the complaint on March 5, 2014. EHCS's response was due on May 30, 2014; instead of filing the response via ECF, EHCS served it on FGA via USPS. Following a hearing on June 12, 2014, EHCS filed its response (which it titled "Declaration of Alham Usman, " although it is in substance a memorandum of law) via ECF. FGA filed its reply on June 30, 2014.

DISCUSSION

I. Legal Standard

To survive a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6), the plaintiff's pleading must contain "sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Although detailed factual allegations are not necessary, mere legal conclusions, "a formulaic recitation of the elements of a cause of action, " or "naked assertions" by the plaintiff will not suffice. Id . (internal quotations and citations omitted). This court must accept as true all of the allegations made in the complaint and draw all reasonable inferences in the plaintiff's favor. Matson v. Bd. of Educ. of the City Sch. Dist. of N.Y., 631 F.3d 57, 63 (2d Cir. 2011).

II. Analysis

A. Choice of Law

The events underlying this lawsuit occurred in both New York and New Jersey, and either state's substantive law might govern here. But as the parties have cited New York law in their motion papers, they have implicitly consented to the application of New York law. Krumme v. Westpoint Stevens Inc., 238 F.3d 133, 138 (2d Cir. 2000) ("The parties' briefs assume that New York law controls, and such implied consent... is sufficient to establish choice of law." (quotation and citation omitted)).

B. Breach of Contract

FGA argues that EHCS's allegations of a breach of contract are conclusory. EHCS responds that its allegations are sufficient to ...


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