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Gizzo v. Ben-Habib

United States District Court, S.D. New York

September 5, 2014


Page 375

For Plaintiff: Jonathan D. Kraut, Esq., Friedman, Harfenist, Langer & Kraut, LLP, Purchase, NY.

For Plaintiff: Neil Stuart Torczyner, Esq., Friedman, Harfenist, Kraut & Perlstein, Lake Success, NY.

For Defendants: Hina Sherwani, Esq., City of Mount Vernon Corporation Counsel, Mount Vernon, NY.

Page 376



Plaintiff Salvatore Gizzo (" Plaintiff" ) brings this Action against Defendants Soraya Ben-Habib (" Ms. Ben-Habib" ), Clinton I. Young (" Mr. Young" ), and the City of Mount Vernon (" the City" ) (collectively, " Defendants" ), alleging that Defendants deprived him of his constitutional rights to procedural and substantive due process under the Fourteenth Amendment and his contractual rights under a licensing agreement. Defendants move to dismiss Plaintiff's Complaint in its entirety. For the following reasons, Defendants' Motion is granted.

Page 377


A. Factual Background

As alleged in Plaintiff's Complaint, the facts underlying the instant Action are fairly straightforward. In 2008, Plaintiff was the owner of Samba Na Brasa, a Brazilian steakhouse located in the Fleetwood section of Mount Vernon (" Fleetwood" ) at 42 Broad Street. (Compl. ¶ 11 (Dkt. No. 1).) In or around November 2008, Mr. Young, who was at the time the mayor of the City, visited Plaintiff at Samba Na Brasa, and informed him that the residents of Fleetwood were unhappy because the only local supermarket was closing down. ( Id. ¶ ¶ 12-13.) Mr. Young then stated to Plaintiff, " Do me a favor. I need to give [the residents of Fleetwood] a supermarket--we'll give you whatever you need." ( Id. ¶ 14 (internal quotation marks omitted).)

After this conversation, Plaintiff and others acting on Plaintiff's behalf " began negotiating with [Mr. Young] and other City employees in an effort to transform the 42 Broad Street location into a supermarket," during which negotiations Plaintiff " indicated to [Mr. Young] and his employees that it was vital to the success of the supermarket that the patrons of the potential supermarket have an adequate supply of safe and inviting parking spaces available." ( Id. ¶ ¶ 15-16.) Because Mr. Young agreed with Plaintiff, " the two sides began to discuss meaningful parking improvements which could be made by the City to further a potential supermarket." ( Id. ¶ 17.) Soon thereafter, Mr. Young and Plaintiff " came to an agreement that the best option for parking for the contemplated supermarket would be the Fleetwood Municipal Parking Garage." ( Id. ¶ 18.)

Following this agreement, in June 2009, Plaintiff, acting on behalf of Fleetwood Food Corporation (" FFC" ), a New York corporation, and Mr. Young, acting on behalf of the City, entered into a Licensing Agreement, pursuant to which FFC was granted " the exclusive right, license and privilege to use forty-five (45) designated parking spaces on the ground floor of the Fleetwood Municipal Parking Garage and fifteen (15) merchant use only parking spaces, all for the use of the contemplated supermarket," " [i]n exchange for [which] FFC became obligated pursuant to the License Agreement to pay [a monthly fee] with the right to prepay for any time period." ( Id. ¶ ¶ 20-21 (internal quotation marks omitted).) FFC was granted " the exclusive right, license, and privilege to use" the parking spaces until March 31, 2014, with " the option to renew . . . upon . . . [the] same terms and conditions for consecutive terms of five (5) years" through 2044, provided that Plaintiff was not in default. (Compl. Ex. A(2), at 2-3.) Additionally, the Licensing Agreement " provided that FFC was granted permission to install an electric parking arm and any other necessary equipment for the purpose of entering and exiting the area containing the . . . [p]arking [s]paces," and required the City, at its sole cost and expense, to " make numerous improvements, alterations, installation and/or repairs" to the Fleetwood Municipal Parking Garage by September 1, 2009. ( Id. ¶ ¶ 24-25 (internal quotation marks omitted).) The Licensing Agreement also stated that it would " be effective only to the extent that [FFC] and/or its successors and/or assigns operates and/or maintains a grocery store/supermarket at 42 Broad Street." ( Id. ¶ 22 (internal quotation marks omitted).) By entering into the Licensing Agreement, the City " acknowledge[d] that [FFC] [was] relying on the . . . representations [contained therein] for the purpose of constructing and operating a grocery store/supermarket . . ., and that

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[FFC] would not enter into such a business venture if unable to use the [p]arking [s]paces" described therein. ( Id. ¶ 23 (first alteration in original) (internal quotation marks omitted).)

" Subsequent to the execution of the Licensing Agreement, [Plaintiff] closed Samba Na Brasa and began renovating 42 Broad Street in order to transform it into a supermarket," " retain[ing] the services of Nima Badaly [(" Mr. Badaly" )] as architect for the renovations." ( Id. ¶ ¶ 26-27.) Mr. Badaly is the former husband of Ms. Ben-Habib, who was the City's First Deputy Building Commissioner, and who Plaintiff claims was also " the de facto Building Commissioner and . . . the decision maker for [the City's] Building Department." ( Id. ¶ ¶ 8, 36.) According to Plaintiff, Mr. Badaly and Ms. Ben-Habib " have children together and thus maintain a close relationship." ( Id. ¶ 37.) Plaintiff also entered into negotiations with Key Food Co-operative, Inc. (" Key Food" ) " to allow FFC to operate the contemplated supermarket as a Key Food." ( Id. ¶ 28.)

Plaintiff claims that " the City never completed its' [sic] responsibilities under the Licensing Agreement." ( Id. ¶ 30.) Specifically, " [a]lthough the Licensing Agreement required the allocation of forty-five spaces for supermarket parking, the City never designated the requisite number." ( Id. ¶ 31.) Additionally, " [a]lthough the City permitted the installation of a parking arm in the garage which was necessary to safeguard the parking spaces, the City refused to provide power for the parking arm, after the device was agreed to and then constructed by FCC at its sole expense." ( Id. ¶ 32.) Further, " [a]lthough the Licensing Agreement required the repair and maintenance of the elevator in the garage, the City never repaired the elevator to working condition." ( Id. ¶ 33.)

Notwithstanding these issues, FCC pressed onwards with the renovation, spending over $3 million in the process. ( Id. ¶ 34.) In or around April 2010, FCC terminated the services of Mr. Badaly. ( Id. ¶ 35.) Plaintiff claims that, following Mr. Badaly's termination, " the City's Building Department began to harass FFC by delaying the determination of permits and inspections on multiple occasions and requiring FFC to wade through numerous levels of red tape which had [previously] not existed." ( Id. ¶ 38.) The City Building Department even " invented problems" on the date that FFC was to open the Key Food " in order to delay the scheduled opening of the supermarket." ( Id. ¶ 39.) And, " [a]lthough the City Building Department was stonewalling progress on FFC's supermarket, it streamlined the application process for [a] competing supermarket" " which sought to open in close proximity." ( Id. ¶ ¶ 40-41.)

By the time FFC opened the supermarket in July 2010, " the City had still not completed the work required under the Licensing Agreement." ( Id. ¶ ¶ 42-43.) In fact, " [n]otwithstanding FFC's constant complaints to the City about the City's failure to abide by the Licensing Agreement, the work required [thereunder] was never completed." ( Id. ¶ 44.) The consequent " lack of adequate parking for the Key Food immediately began to impact on FFC's profits," causing " patrons [to] stop[] shopping" there. ( Id. ¶ 45.) Eventually, FFC filed for Chapter 7 Bankruptcy. ( Id. ¶ 47.) After FFC's bankruptcy trustee assigned certain of FFC's claims against the City to Plaintiff, Plaintiff initiated this Action. ( Id. ¶ 48.)

B. Procedural Background

Plaintiff filed his Complaint on April 1, 2013. ( See Dkt. No. 1.) Plaintiff asserts five causes of action against Defendants therein. First, Plaintiff claims that, " [a]s a result of the actions and inactions of [Mr.

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Young] and the City" in failing to " perform the actions which [the City] was obligated to take under the Licensing Agreement," " [Plaintiff] and FFC were deprived of their right to procedural due process." (Compl. ¶ ¶ 52, 56.) Second, Plaintiff claims that he and FFC were also deprived of their right to procedural due process " [a]s a result of [Ms. Ben-Habib's] campaign to obstruct the progress in opening the Key Food supermarket." ( Id. ¶ 64.) Third, Plaintiff claims that Ms. Ben-Habib's " campaign" also deprived Plaintiff of his right to substantive due process. ( Id. ¶ 72.) In his fourth cause of action, which Plaintiff titles " Failure to Train/Supervise-- Monell Claim," Plaintiff claims that the deprivations of his and FFC's constitutional rights stemming from Ms. Ben-Habib's " campaign" were caused in part by the City's failure " to adequately provide for a system of checking for conflicts of interest in relation to projects submitted by [Mr. Badaly] for approval by the City's Building Department," as well as its failure " to adequately supervise the employees of the City's Building Department to prevent special treatment being given to projects involving plans drawn by [Mr. Badaly]." ( Id. ¶ ¶ 75-79.) Fifth, Plaintiff claims that the City " unilaterally and materially breached the Licensing Agreement through numerous acts and omissions." ( Id. ¶ 84.)

On November 6, 2013, Defendants filed their Motion To Dismiss. ( See Dkt. Nos. 12-14.) Plaintiff filed his Opposition thereto on December 6, 2013, ( see Dkt. No. 15), to which Defendants replied on December 20, 2013, ( see Dkt. No. 16), at which point Defendants' Motion was fully submitted.


A. Standard of Review

Defendants move to dismiss Plaintiff's Complaint under Rule 12(b)(6) of the Federal Rules of Civil Procedure. " While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff's obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do." Bell A. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (citations, internal quotation marks, and alterations omitted). Indeed, Rule 8 of the Federal Rules of Civil Procedure " demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation." Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). " Nor does a complaint suffice if it tenders naked assertions devoid of further factual enhancement." Id. (internal quotation marks and alterations omitted). Instead, a complaint's " [f]actual allegations must be enough to raise a right to relief above the speculative level." Twombly, 550 U.S. at 555. Although " once a claim has been stated adequately, it may be supported by showing any set of facts consistent with the allegations in the complaint," id. at 563, and a plaintiff must allege " only enough facts to state a claim to relief that is plausible on its face," id. at 570, if a plaintiff has not " nudged [his or her] claim[] across the line from conceivable to plausible, the[] complaint must be dismissed," id.; see also Iqbal, 556 U.S. at 679 (" Determining 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. But where the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged--but it has not

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'show[n]'--'that the pleader is entitled to relief.'" (citation omitted) (second alteration in original) (quoting Fed.R.Civ.P. 8(a)(2))); id. at 678-79 (" Rule 8 marks a notable and generous departure from the hyper-technical, code-pleading regime of a prior era, but it does not unlock the doors of discovery for a plaintiff armed with nothing more than conclusions." ).

" [W]hen ruling on a defendant's motion to dismiss, a judge must accept as true all of the factual allegations contained in the complaint." Erickson v. Pardus, 551 U.S. 89, 94, 127 S.Ct. 2197, 167 L.Ed.2d 1081 (2007) (per curiam); see also Nielsen v. Rabin, 746 F.3d 58, 62 (2d Cir. 2014) (" In addressing the sufficiency of a complaint we accept as true all factual allegations . . . ." (internal quotation marks omitted)); Aegis Ins. Servs., Inc. v. 7 World Trade Co., 737 F.3d 166, 176 (2d Cir. 2013) (" In reviewing a dismissal pursuant to Rule 12(b)(6), we . . . accept all factual allegations in the complaint as true . . . ." (internal quotation marks and alterations omitted)). Further, " [f]or the purpose of resolving [a] motion to dismiss, the Court . . . draw[s] all reasonable inferences in favor of the plaintiff." Daniel v. T & M Prot. Res., Inc., 992 F.Supp.2d 302, 304 n.1 (S.D.N.Y. 2014) (citing Koch v. Christie's Int'l PLC, 699 F.3d 141, 145 (2d Cir. 2012)). Additionally, " [i]n ruling on a 12(b)(6) motion, . . . a court may consider the complaint[,] . . . any written instrument attached to the complaint as an exhibit[,] or any statements or documents incorporated in it by reference," as well as " matters of which judicial notice may be taken, and documents either in plaintiffs' possession or of which plaintiffs had knowledge and relied on in bringing suit." Kalyanaram v. Am. Ass'n of Univ. Professors at N.Y. Inst. of Tech., Inc., 742 F.3d 42, 44 n. 1 (2d Cir. 2014) (citation, internal quotation marks, and some alterations omitted); see also Leonard F. v. Isr. Disc. Bank of N.Y., 199 F.3d 99, 107 (2d Cir. 1999) (" In adjudicating a Rule 12(b)(6) motion, a district court must confine its consideration to facts stated on the face of the complaint, in documents appended to the complaint or incorporated in the complaint by reference, and to matters of which judicial notice may be taken." (internal quotation marks omitted)); Hendrix v. City of New York, No. 12-CV-5011, 2013 WL 6835168, at *2 (E.D.N.Y. Dec. 20, 2013) (same).

B. Analysis

1. Procedural Due Process

Plaintiff's first two causes of action allege a violation of his procedural-due-process rights. In his first cause of action, Plaintiff asserts that his procedural-due-process rights were violated by Mr. Young's and the City's " actions and inactions" in failing to " perform the actions which [the City] was obligated to take under the Licensing Agreement." (Compl. ¶ ¶ 52, 56.) In his second cause of action, Plaintiff asserts that his procedural-due-process rights were violated by Ms. Ben-Habib's " campaign to obstruct the progress in opening the Key Food supermarket." ( Id. ¶ 64.)

The Fourteenth Amendment to the United States Constitution provides in part that " [n]o State shall . . . deprive any person of life, liberty, or property, without due process of law." U.S. Const. amend. XIV, § 2; see also Marino v. City Univ. of N.Y., F.Supp.2d, 18 F.Supp.3d 320, 2014 WL 1874855, at *10 (E.D.N.Y. May 9, 2014) (same). " To plead a violation of procedural due process, . . . a plaintiff must first identify a property right, second show that the government has ...

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