KENNY v. ONWARD SEARCH et al

Filing 13

OPINION. Signed by Judge Jose L. Linares on 4/15/15. (DD, )

NOT FOR PUBLICATION

UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY

JOHN KENNY,
Civil Action No. 15-0456 (JLL) (JAD)

Plaintiff,
V.

OPINION

ONWARD SEARCH and TANDEMSEVEN,
Defendants.

LINARES, District Judge.
This matter comes before the Court by way of Defendants Onward Search (“Onward”)
and TandemSeven (collectively “Defendants”)’ motion to dismiss Plaintiff John Kenny
(“Plaintiff’)’s Complaint (ECF No. 1) pursuant to Federal Rule of Civil Procedure 12(b)(6
).
(ECF No. 10). The Court has considered the parties’ submissions in support of and
in opposition
to the instant motion and decides this matter without oral argument pursuant to Federa
l Rule of
Civil Procedure 78. For the reasons set forth below, the Court GRANTS Defendants’
motion.
I. BACKGROUND’

Plaintiff is an individual residing in Morris County, New Jersey. (Comp. at 1).
¶
Defendant Onward Search is nationwide staffing agency, located and organized under
the laws
of Connecticut, with an office in New York City. (Id. at 2, 7). Defendant
Tandem Seven is a
¶{
Corporation located in New York City. (Id. at 3). On or about August 18, 2014
¶
a representative

‘The following facts are taken as true solely for the purposes of this motion.

named Justin Court (“Mr. Court”) of Onward contacted Plaintiff regarding a freelance
opportunity to work for TandemSeven. (Id. at ¶ 6). Plaintiff agreed that Mr. Court and Onward
would represent Plaintiff. (Id. at ¶ 8). Plaintiff confirmed that he was interested in a “1099
Contract corp. to corp.” at an hourly rate of not less than $85.00. (Id. at 9). Consequently
¶
Plaintiff had three phone interviews and an in person interview with TandemSeven between
September 4, 2014 and September 17, 2014. (Id. at ¶J 10-12). Following the in-person interview,
when Mr. Court asked Plaintiff is he would like to proceed with Tandem Seven if they made an
offer “today”, Plaintiff replied, “yes, so long as everything we discussed was still in place.” (Id.
atJ 13-15).
Mr. Court then reminded Plaintiff that Onward was representing Plaintiff at $85.00 for
the previously mentioned contract and that the contract was already approved by TandemSeven.
(Id, at ¶ 16). Plaintiff then told Mr. Court that if everything was in place and Tandem S even
offered him the position, Plaintiff would accept and give Plaintiff’s present employer two weeks’
notice. (Id. at ¶ 17). Within twelve minutes, Mr. Court called Plaintiff to advise him that
TandemSeven would like to move forward as soon as possible and that Plaintiff should get his
resignation to Plaintiff’s current employer in as soon as possible. (Id. at 18). On September 18,
¶
2014, Plaintiff resigned his position with his then current employer. (Id. at 20).
¶
On September 19, 2014, Plaintiff spoke with Mr. Court, who advised Plaintiff that
TandemSeven had rescinded the offer because Plaintiff could not start immediately. (Id. at 22).
¶
Plaintiff had expected to earn a minimum of $3,400 per week. (Id. at 23). Based upon his
¶
conversations with TandemSeven, Plaintiff’s position would have lasted eight (8) months. (Id. at

¶ 24). Neither Onward nor TandemSeven told Plaintiff that his job offer was conditioned upon
him starting immediately, nor that Plaintiff’s providing two weeks’ notice was unacceptable to

TandemSeven. (Id. at ¶J 26-27). Plaintiff alleges that both TandemSeven and Onward owed
Plaintiff a duty to inform Plaintiff that the acceptance of the position with TandemSeven was
contingent upon Plaintiff’s immediate start with the company. (Id. at 31).
¶
On December 11, 2014 Plaintiff filed this action with the Superior Court of New Jersey,
Morris County, Law Division, alleging Breach of Contract, Breach of Implied Covenant of Good
Faith and Fair Dealing, and Fraud/Misrepresentation.

(Id. at ¶J 32-47). Thereafter, on January

22, 2015. Defendants removed this action to the United States District Court, District of New
Jersey.
II. LEGAL STANDARD

For a complaint to survive dismissal, it “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) (citing Bell Ati. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “Threadbare recitals
of the elements of a cause of action, supported by mere conclusory statements, do not suffice.”
Id. In determining the sufficiency of a complaint, the Court must accept all well-pleaded factual
allegations in the complaint as true and draw all reasonable inferences in favor of the nonmoving party. See Phillips v. County ofAllegheny, 515 F.3d 224, 234 (3d Cir. 2008). But, “the
tenet that a court must accept as true all of the allegations contained in a complaint is
inapplicable to legal conclusions.” Iqbal, 556 U.S. at 678. Thus, legal conclusions draped in
the
guise of factual allegations may not benefit from the presumption of truthfulness. Id.; In re Nice
Sys., Ltd. Sec. Litig., 135 F. Supp. 2d 551, 565 (D.N.J. 2001).
III. DISCUSSION
A. Motion Before the Court
1. Defendants’ Motion

Defendants argue that Plaintiffs Complaint should be dismissed on the following
grounds: (1) Count I of the Complaint should be dismissed because Plaintiff fails to state a claim
for breach of contract; (2) Count II of the Complaint should be dismissed because Plaintiff fails
to state a claim for breach of implied covenant of good faith and fair dealing; and (3) Count III of
the Complaint must be dismissed for failure to state a claim for fraud.
2. Plaintiff’s Opposition

Plaintiff rebuts Defendants’ grounds for dismissal by asserting that Plaintiffs Complaint
contains sufficient facts to withstand Defendants’ motion to dismiss.
B. Count I

To establish a claim for breach of contract, a plaintiff must allege (1) the existence of a
contract; (2) a breach of that contract; (3) damages flowing therefrom; and (4) that plaintiff
performed his own contractual duties. Frederico v. Home Depot, 507 F.3d 188, 203 (3d
Cir.2007). Defendants argue that Plaintiffs allegation of the existence of a valid contract is
conclusory at best. Defendants state that Plaintiff has not alleged any “essential terms” of the
puiported contract. Specifically, Defendants contend that Plaintiff has failed to allege “essential
terms” such as (1) the expected or anticipated duration of his assignment; (2) the specific
compensation terms agreed upon by the parties for Plaintiffs work as a freelancer; or (3) the
specific duties and responsibilities Plaintiff was to perform as a freelancer. Moreover,
Defendants assert that Plaintiff has not alleged any actual performance of any duties he was
obligated to perform under the purported contract.
Plaintiff responds to Defendants contentions by stating that there was an offer by
TandemSeven, which was accepted Plaintiff, who immediately resigned his full time
employment and provided two weeks’ notice. Plaintiff states that the oral employment
contract

contained all material terms: location (Jersey City, N.J.); compensation (1099 Contract corp. to
corp. at hourly rate of at least $85.00); type of employment (freelance); duration (8 months); and
start date (as soon as resignation with present employment was complete.)
The Court agrees with Defendants. Although in his opposition brief, Plaintiff lists the
purported material terms of the alleged contract, the ambiguous nature of Plaintiffs pleadin
g
does not reasonably allow the Court to infer that Plaintiff has sufficiently alleged an existen
ce of
a contract; a breach of that contract; damages flowing therefrom; and that Plaintiff performed his
own contractual duties. Chemtech Int’l v. Chem. Injection Techs., 170 Fed. Appx. 805,
807 (3d
Cir. 2006) (“To maintain a cause of action in breach of contract, a plaintiff must establi
sh.

.

.

the

existence of a contract, including its essential terms”). However, because the Court finds that
Plaintiffs may be able to plead breach of contract with specificity, the Court will grant an
opportunity to amend this claim insofar as Plaintiff can assert the alleged offer to contract
by the
Defendants, the material terms of the alleged contract, and the alleged acceptance of those
terms.
Therefore, Count I is dismissed without prejudice.
C. Count II

Under New Jersey law, all contracts include an implied covenant that the parties to the
contract will act in good faith. Gehringer v. Atlantic Detroit Die sel Allison, LLC, 2009
U.s.
Dist. LEXIS 23579 (D.N.J. Mar. 23, 2009) (Linares, J.); see also, e.g., Sons of Thund
er. Inc. v.
Borden, Inc., 148 N.J. 396, 690 A.2d 575, 587 (N.J.1997). The covenant “mand
ates that ‘neither
party shall do anything which will have the effect of destroying or injuring the
right of the other
party to receive the fruits of the contract.’

“

Seidenberg v. Summit Bank, 348 N.J.Super. 243,

254, 791 A.2d 1068 (App.Div.2002) (quoting Sons of Thunder v. Borden. Inc.,
148 N.J. 396,
420, 690 A.2d 575 (1997)). Warning against overly broad constructions of the
covenant of good

faith, the New Jersey Supreme Court held that “an allegation of bad faith or unfair dealing
should not be permitted to be advanced in the abstract and absent an improper motive.”
Brunswick Hills Racquet Club, Inc. v. Rte. 18 Shopping Center Assoc., 182 N.J. 210, 231,
864
A.2d 387 (2005). Defendants argue that because Plaintiff did not sufficiently plead the existen
ce
of a contract with Defendants, Plaintiff cannot sufficiently allege that Defendants breached the
implied covenant of good faith and fair dealing.
As the Court previously noted, Plaintiff has failed to adequately allege the existence of a
contract. Without sufficiently alleging the existence of a contract, Plaintiff cannot suffici
ently
allege the breach of the implied covenant of good faith and fair dealing. Moreover, Plainti
ffs
complaint fails to allege why under the facts specific to this case early termination of the contrac
t
was in bad faith. In short, the claim for breach of the implied covenant of good faith and fair
dealing fails to state a claim under Rule 8(a), under the standard articulated by Twom
bly and
Iqbal, and must be dismissed pursuant to Federal Rule of Civil Procedure 1 2(b)(6). Howev
er,
because the Court finds that Plaintiffs may be able to plead a breach of the implied covena
nt of
good faith and fair dealing sufficiently, the Court will grant an opportunity to amend this
claim
insofar as Plaintiff can assert the alleged offer to contract by the Defendants, of the
implied
covenant of good faith and fair dealing, and that Defendants acted in bad faith or
with ill motive
in terminating the alleged contract. Therefore, Count II is dismissed without prejud
ice.
D. Count III
To state a claim for fraud under New Jersey law, a plaintiff must allege (1) a materi
al
misrepresentation of fact; (2) knowledge or belief by the defendant of its falsity;
(3) intention
that the other person rely on it; (4) reasonable reliance thereon by the other person
; and (5)
resulting damage. Gennari v. Weichert Co. Realtors, 148 N.J. 582, 691 A.2d
350, 367—368

(1997). Fraud-based claims are subject to FED. R. CIV. P. 9(b). Dewey v. Volkswagon, 558
F.Supp.2d 505, 524 (D.N.J.2008) (“[New Jersey Consumer Fraud Act] claims ‘sounding in
fraud’ are subject to the particularity requirements of Federal Rule of Civil Procedure 9(b).”)
.
Under Rule 9(b), “[i]n alleging fraud or mistake, a party must state with particularity the
circumstances constituting fraud or mistake.”
A Plaintiff must state the circumstances of the alleged fraud “with sufficient particularity
to place the Defendant on notice of the ‘precise misconduct with which [it is] charged.’
Frederico v. Home Depot, 507 F.3d 188, 200 (3d Cir.2007) (citing Lum v. Bank ofAme
rica, 361
F.3d 217, 223—224 (3d Cir.2004). To satisfy this standard, the Plaintiff must plead or allege
the
date, time and place of the alleged fraud or otherwise inject precision or some measure of
substantiation into a fraud allegation.” Id. Moreover, a complaint must” ‘state with particu
larity
both the facts constituting the alleged violation, and the facts evidencing scienter, i.e., the
defendant’s intention ‘to deceive, manipulate, or defraud.’ “3 Tellabs, 551 U.S. at 313, 127
5.Ct.
at 2504. To satisfy the latter requirement, a plaintiff must” ‘state with particularity facts
giving
rise to a strong inference that the defendant acted with the required state of mind.’ “Id.
at 314,
127 S.Ct. at 2504 (quoting 15 U.S.C.

§ 78u—4(b)(2)).

Defendants argue that Plaintiff bases his fraud claim solely upon general, conclusory
and
self-serving allegations of misrepresentations and such allegations fail to meet the
stringent
pleading requirements of Fed. R. Civ. P. 9 (b). Defendants state that the Complaint
lacks
allegations that Defendants made representations with the intention of not honori
ng them at the
time the representation were made, as Plaintiff never was guaranteed the freelan
ce position with
TandemSeven, only that TandemSeven “would like to move forward.” Plaintiff
argues that even

if this Count does not sufficiently allege Fraud, it does sufficiently allege negligent
misrepresentation.
The Court agrees with Defendants. Plaintiff has failed to allege, with particularity, facts
that give rise to a strong inference that Defendants acted with the required state of mind.
Plaintiff’s ambiguous pleading approach also does not allow the Court to infer at this time
whether Plaintiff is asserting a fraud count or a misrepresentation count. The Court will grant an
opportunity to amend this claim insofar as Plaintiff can assert facts with sufficient particularity to
meet the pleading standards articulated by the Federal Rules of Civil Procedure, as well as clear
any ambiguity as to what this particular Count is asserting against Defendants. Therefore, Count
III is dismissed without prejudice.
IV. CONCLUSION

For the reasons herein expressed, Plaintiff’s Complaint is dismissed without prejudice.
Plaintiff may amend within 30 days.
An appropriate Order accompanies this Opinion.

Date: April

t5 2015
Jose L. Linares
United States District Judge