United States District Court, W.D. New York
DECISION AND ORDER
HONORABLE MICHAEL A. TELESCA United States District Judge.
by counsel, Dawn Thompson (“Plaintiff”), a
resident of Florida, instituted this proceeding alleging
causes of action for breach of contract and promissory
estoppel against Combined Systems, Inc. (“CSI” or
“Defendant”), a registered New York corporation
with a principal place of business in Pennsylvania. The Court
has diversity jurisdiction over this matter pursuant to 28
U.S.C. § 1332.
Handcuffs Corporation (“Thompson Handcuffs” or
“THC”) was founded by Charles Thompson in the
1980s. In July of 2010, CSI, CSI-Penn Arms, LLC, a
wholly-owned subsidiary of CSI; Charles Thompson; and
Plaintiff entered into an Asset Purchase Agreement
(“the Purchase Agreement”), whereby certain
assets of Thompson Handcuffs were sold to CSI. As of the date
the Purchase Agreement was executed, Plaintiff owned all of
THC's issued and outstanding capital stock, and was
responsible for the day-to-day operations of the business.
purchase price is reflected in Paragraph 1.3 of the Purchase
Agreement which states in relevant part as follows:
1.3. Purchase Price. The total purchase price (the
“Purchase Price”) which the Buyer shall pay for
the Assets and in consideration of the covenants of the
Sellers contained herein is:
(a) 300, 000.00 in cash, of which (x) $200, 000.00 is payable
at the Closing (the “Initial Payment”) and (y)
the remainder is payable in installments as follows:
(i) For each pair of handcuffs sold by the Buyer after the
Closing the Buyer will pay the Company $0.25 until the
aggregate amount of all such payments as to pairs of
handcuffs sold by the Buyer after the Closing equals $100,
000.00 (each such payment, an “Installment
Payment”), it being recognized that
(A) in no event shall the total amount of installment
Payments exceed $100, 000.00 (the “Installment
Cap”) . . . .
Agreement, ¶ 1.3, Exhibit (“Ex.”) A to First
Amended Complaint (“FAC”) [#10-1]. CSI paid
Thompson Handcuffs the sum of $200, 000 at the closing and
continued to make annual Installment Payments to Thompson
Handcuffs. As of January 1, 2017, CSI had paid Plaintiff a
total of $22, 892.26 toward the remaining $100, 000
Purchase Agreement's “Recitals” section, the
parties included language regarding CSI's continued
employment of Plaintiff. Specifically, one of the
“whereas” clauses states that “the Buyer
wishes to employ [Plaintiff] from and after the Closing (as
hereinafter defined) at CSI's facility in Jamestown,
Pennsylvania, in a sales and marketing capacity on an at-will
basis[.]” Purchase Agreement, p. 1.
of 2010, CSI sent Plaintiff a letter offering her a position
of employment. The letter is referenced in Plaintiff's
first amended complaint, see FAC, ¶¶
26-37, and states in pertinent part as follows:
In order to support the sales efforts of THC into the future,
we are pleased to offer you a position as a Sales Manager of
the THC brand for CSI. . . .
As the Sales Manager of the THC product line, you will be
responsible for the development of sales for the domestic and
international markets, as determined by CSI management. You
will work closely with the other members of the CSI sales
team and you will participate in weekly sales conference
calls and other designated meetings, reporting on your
prospects and sales activities to CSI senior management.
accepted the employment offer and agreed that she would be
based out of CSI's headquarters, which required her to
relocate from Illinois to Jamestown, Pennsylvania.
was employed by CSI as the sales manager of the Thompson
Handcuffs brand beginning August 1, 2010. She held this
position until her termination by CSI on or about July 17,
STATUS OF THIS ACTION
January 1, 2017, Plaintiff filed the instant complaint [#1]
asserting that CSI breached its obligations under the
Purchase Agreement, wrongfully terminated her employment
prior to the expiration of their oral employment agreement,
and failed to reimburse her for the costs she incurred in
relocating to Pennsylvania.
February 14, 2017, CSI filed a pre-answer motion to dismiss
pursuant to Rule 12(b)(6) or, in the alternative, for
summary judgment pursuant to Rule 56.
March 8, 2017, Plaintiff filed a first amended complaint
[#10]. CSI then moved to dismiss the first amended complaint
or, in the alternative, for summary judgment [#11]. Plaintiff
filed a motion for extension of time to file an amended
complaint or, in the alternative, for leave to amend [#12].
CSI filed a memorandum in opposition [#13], and Plaintiff
filed a reply brief [#14].
subsequently filed a memorandum of law in opposition to
CSI's first motion to dismiss or, in the alternative, for
summary judgment [#16], and a memorandum of law in opposition
to CSI's second motion to dismiss or, in the alternative,
for summary judgment [#17]. CSI filed a reply brief. [#18].
reasons discussed below, the Court grants Plaintiff's
request for leave to amend, and replaces the complaint with
the first amended complaint. The Court grants CSI's
motions to dismiss or, in the alternative for summary
judgment, and dismisses the first amended complaint.
Plaintiff's Motion for Extension of Time to File Amended
Complaint or, in ...