Tekdoc Svc LLC et al v. 3i-Infotech Inc
Filing
186
MEMORANDUM OPINION. Signed by Judge Mary L. Cooper on 5/20/2013. (gxh)
NOT FOR PUBLICATION
UNITED STATES DISTRICT COURT
DISTRICT OF NEW JERSEY
TEKDOC SERVICES, LLC, et al.,
CIVIL ACTION NO. 09-6573 (MLC)
MEMORANDUM OPINION
Plaintiffs,
v.
3i-INFOTECH INC., et al.,
Defendants.
COOPER, District Judge
The plaintiffs, Lou Ann Naples (“Naples”) and TekDoc Services,
LLC (“TekDoc”), brought this action against the defendants, 3iInfotech Inc. (formerly known as “Innovative Business Solutions,
Inc.” or “IBSI”, and uniformly referred to here as “Infotech”) and
Ranbaxy, Inc. (“Ranbaxy”).
(See dkt. entry no. 95, 2d Am. Compl.)1
The plaintiffs raise claims against Ranbaxy for breach of contract,
breach of the implied covenant of good faith and fair dealing,
unjust enrichment, innocent misrepresentation, negligent infliction
of emotional distress, negligent misrepresentation, and fraud in
the inducement.
1
(Id. at 11-17.)
Infotech earlier moved for summary judgment in its favor and
against the plaintiffs on the claims raised against it in the
Second Amended Complaint. (See dkt. entry no. 137, 1-17-12 Notice
of Infotech Mot.) The Court granted that motion, thereby resolving
all of the claims raised in the action against Infotech. (See dkt.
entry no. 161, 8-16-12 Order & J.) See generally TekDoc Servs.,
LLC v. 3i-Infotech Inc., No. 09-6573, 2012 WL 3560794 (D.N.J. Aug.
16, 2012). Only the claims raised against Ranbaxy remain viable.
Ranbaxy now moves for summary judgment in its favor and
against the plaintiffs on all of the claims raised against it.
(See dkt. entry no. 167, Notice of Ranbaxy Mot.; dkt. entry no.
167-2, Br. in Supp.)
The plaintiffs oppose the motion.
They
disagree with Ranbaxy about the choice of law issues relating to
and substantive resolution of each of those claims.
(See dkt.
entry no. 171, Opp’n Br.)
The Court now resolves the Ranbaxy Motion on the papers and
without oral argument.
See L.Civ.R. 78.1(b).
For the reasons that
follow, the Court will grant the Ranbaxy Motion, and enter judgment
in Ranbaxy’s favor on all of the claims raised against it.
I.
BACKGROUND
A.
The Plaintiffs
Naples is a citizen of Connecticut.
WL 3560794, at *1.
See TekDoc Servs., 2012
She is the sole member and employee of TekDoc,
a limited liability company organized under the laws of that state.
(See dkt. entry no. 167-8, Ranbaxy Statement of Undisputed Facts
(“Ranbaxy SOF”) at ¶ 1; dkt. entry no. 173, Pls.’ Response to
Ranbaxy SOF at ¶ 1.)
It appears that Naples has worked in and has
experience in the field of information technology (“IT”).
B.
Infotech & Ranbaxy
Infotech is a staff augmentation firm that matches clients
with temporary computer software assignments with IT professionals.
2
(See Ranbaxy SOF at ¶ 4; Pls.’ Response to Ranbaxy SOF at ¶ 4.)
The nature of Infotech’s business requires it to contract with both
its clients and the IT professionals whom it recruits to complete
its clients’ projects.
See TekDoc Servs., 2012 WL 3560794, at *1.
Infotech executed a written contract with one of its clients,
Ranbaxy, in July of 2004.
(See dkt. entry no. 172-1, Ex. E to
Sabatini Aff., Master Services Agreement.)
Ranbaxy provides, inter
alia, financial and legal services to related entities.
(See
Ranbaxy SOF at ¶ 3; Pls.’ Response to Ranbaxy SOF at ¶ 3.)
It is
organized under the laws of Delaware and maintains its principal
place of business in Princeton, New Jersey.
(See Ranbaxy SOF at
¶ 3; Pls.’ Response to Ranbaxy SOF at ¶ 3.)2
C.
Naples’s Initial Interactions with Infotech & Ranbaxy
Infotech, following execution of the Master Services
Agreement, advertised that it sought a “validation specialist,
2
Infotech and the plaintiffs earlier represented that Ranbaxy
manufactures pharmaceutical products, is organized under the laws
of India, and maintains administrative offices in Princeton, New
Jersey. (See dkt. entry no. 137-2, Infotech SOF at ¶¶ 2, 10-11;
dkt. entry no. 150, Pls.’ Response to Infotech SOF at ¶¶ 2, 10-11.)
Those representations informed the Court’s earlier Memorandum
Opinion, which concerned Infotech’s motion for summary judgment.
See TekDoc Servs., 2012 WL 3560794, at *1.
It now appears that the Court was misinformed, as Infotech and
the plaintiffs conflated facts concerning Ranbaxy with those
concerning a related entity, Ranbaxy Laboratories Ltd. (“Ranbaxy
Labs”). Ranbaxy Labs manufactures pharmaceutical products, is a
corporation organized under the laws of India, and relies on
Ranbaxy -- an entity with administrative offices in Princeton -for legal, financial, and other professional services. (See
Ranbaxy SOF at ¶¶ 3, 8; Pls.’ Response to Ranbaxy SOF at ¶¶ 3, 8.)
3
contract to hire, temp to perm.”
(See dkt. entry no. 172-1, Ex. B
to Sabatini Aff., Tr. of 3-8-11 Naples Dep. at 25.)
Naples saw the
advertisement, forwarded her résumé to Infotech, and spoke with an
Infotech recruiter.
(See id. at 26.)
The Infotech recruiter
explained to Naples that Ranbaxy sought an independent contractor
for a six-month, “temp to perm” assignment, and that Ranbaxy would
only consider candidates who were interested in securing so-called
“permanent” employment at Ranbaxy.
(See dkt. entry no. 172-1, Ex.
A to Sabatini Aff., Tr. of 10-27-08 Naples Dep. at 54; Tr. of
3-8-11 Naples Dep. at 27.)3
The recruiter further explained that
Ranbaxy employees would both interview Naples and retain decisionmaking authority relating to her potential hire as a contractor and
her later potential conversion to a full-time Ranbaxy employee.
(See Tr. of 10-27-08 Naples Dep. at 56-57.)
Naples was twice interviewed by Ranbaxy personnel.
She first
spoke by telephone with Ranbaxy’s IT manager, Jeevan Rebba, and
later met with both Rebba and his supervisor, Suneet Walia, in
Princeton.
(See id. at 59-60, 63-64; dkt. entry no. 167-4, Walia
Decl. at ¶¶ 2-3; dkt. entry no. 167-5, Rebba Decl. at ¶¶ 2, 4.)
Following those interviews, Walia informed Infotech that Ranbaxy
3
Naples has explained that “permanent” and “full-time” are,
insofar as the Ranbaxy Motion is concerned, interchangeable terms.
(See dkt. entry no. 172-1, Ex. C to Sabatini Aff., Naples Aff. at
¶ 7 (“I believed a permanent position to mean that I would be made
a full-time employee, rather than a temporary employee.”).)
4
would award the independent contractor position to Naples, via
TekDoc.
(See Walia Decl. at ¶ 3; Rebba Decl. at ¶ 4.)
Naples asserts that Rebba and Walia, during the interview
process, described the independent contractor position as “temp to
perm” and “contract to hire”.
(Tr. of 10-27-08 Naples Dep. at
56-57, 59; Tr. of 3-8-11 Naples Dep. at 28, 32.)
She also asserts
that both Rebba and Walia represented that Ranbaxy: (1) intended to
convert the independent contractor to a full-time employee after
six months; and (2) would only award the independent contractor
position to her if she was interested in joining at Ranbaxy as a
full-time employee upon the completion of the independent
contractor position’s six-month term.
(See Tr. of 10-27-08 Naples
Dep. at 64-65; Tr. of 3-8-11 Naples Dep. at 30, 32, 34; Naples Aff.
at ¶ 6.)
Naples claims that she would not have been interested in
the independent contractor position but for these representations.
(See Naples Aff. at ¶ 9; Tr. of 10-27-08 Naples Dep. at 266.)
Rebba and Walia both acknowledge that they discussed the
possibility of converting the independent contractor to a full-time
Ranbaxy employee.
(See Walia Decl. at ¶ 5; Rebba Decl. at ¶ 6.)
But both of them deny representing that such conversion would be
“automatic” or “guaranteed”; instead, they assert that they spoke
with Naples about the “potential opportunity” of a conversion to
5
full-time employment by Ranbaxy.
at ¶ 6.)
(Walia Decl. at ¶ 5; Rebba Decl.
Walia, for example, states in his declaration that:
I discussed the potential opportunity for her to join
Ranbaxy in a full-time position if a position that
matched her capabilities and experiences was approved,
and that it would be subject to the Ranbaxy budget
process and approvals by corporate headquarters. I
never told Naples that she could be automatically
converted from a temporary contractor to being hired as
a permanent employee, or that the temporary position was
guaranteed to be converted from a temporary position to
a permanent position, or any other words to that effect.
The substance of the discussion I had with Naples about
the full-time permanent employee position was that it
was a possibility for her, if it became available; and
if it did become available, she would be one of the
candidates to be considered for the position; however,
Ranbaxy had the right to deny her the position, and
Naples had the right to deny the position.
(Walia Decl. at ¶ 5.)
Ranbaxy points to Naples’s deposition
testimony as proof that she understood that the six-month temporary
position was, in a sense, an ongoing interview for any full-time
position that became available at Ranbaxy.
(See Ranbaxy SOF at
¶ 23 (citing Tr. of 10-27-08 Naples Dep. at 65).)
Naples denies that Ranbaxy informed her that it had neither
established nor funded the full-time position.
¶ 8.)
(See Naples Aff. at
She asserts that such knowledge would have lessened her
interest in the independent contractor position.
6
(Id. at ¶ 9.)
D.
Naples’s Acceptance of the Independent Contractor
Position
Naples accepted the independent contractor position, and
TekDoc and Infotech executed a written contract (“Software Services
Agreement”).
(See dkt. entry no. 172-1, Ex. F to Sabatini Aff.,
Software Services Agreement.)
The first exhibit to the Software
Services Agreement, the First Purchase Order, states that Naples
would begin working for Ranbaxy on January 24, 2005, for a period
of “6 month [sic] with possible extensions”.
(Dkt. entry no.
172-1, Ex. F to Sabatini Aff., First Purchase Order.)
The Software Services Agreement does not mention Ranbaxy’s
alleged promise to convert Naples from an independent contractor to
a full-time Ranbaxy employee, and it appears not to contemplate
that possibility.
(But see Software Services Agreement at § 6
(setting forth non-solicitation and non-competition covenants).)
It does, however, provide that it “may be terminated by either
party at any time without further obligation upon fourteen (14)
days written notice to the other party.”
E.
(Id. § 14(C).)
Naples’s Time in New Jersey, at Ranbaxy
Naples worked as an independent contractor at Ranbaxy, through
her relationships with TekDoc and Infotech, from January 24, 2005
to July 8, 2005.
On that date, she, Ranbaxy, and Infotech agreed
to extend her term as an independent contractor for an additional
“6 months with possible extensions”.
7
(Dkt. entry no. 172-1, Ex. F
to Sabatini Aff., Second Purchase Order.)
The Second Purchase
Order provides that the plaintiffs could terminate the Software
Services Agreement by providing thirty days’ written notice to both
Ranbaxy and Infotech.
(See id.)
It also provides that the “end
Client”, Ranbaxy, could terminate the Software Services Agreement
either with or without notice.
(See id.)
Rebba approached Naples in October of 2005, during the period
specified in the Second Purchase Order, and asked her to accept an
assignment at Ranbaxy Labs in Gurgaon, India.
(See Rebba Decl. at
¶ 8; see also 10-24-05 Letter from Walia to Naples; dkt. entry no.
172-1, Ex. D to Sabatini Aff., Tr. of Rebba Dep. at 114-15.)
Naples was not bound to accept that assignment; both Ranbaxy and
the plaintiffs appear to acknowledge that Rebba’s request exceeded
the scope of the Software Services Agreement.
Naples Dep. at 86; Rebba Decl. at ¶ 8.)
(See Tr. of 10-27-08
Naples nonetheless
accepted it because she feared losing the possibility of full-time
employment at Ranbaxy.
(See Tr. of 10-27-08 Naples Dep. at 86
(“[I]f I declined that trip, I would have been walking away from
the job that I wanted.”).)
Naples negotiated the terms of that assignment directly with
Ranbaxy.
Walia instructed Naples to secure a multiple entry visa.
(See dkt. entry no. 172-1, Ex. O to Sabatini Aff., 10-24-05 Letter
from Walia to Naples.)
Further, Ranbaxy set forth the nature and
8
scope of Naples’s work at Ranbaxy Labs, and agreed, among other
things, to arrange for Naples’s lodging, transportation from the
airport, and daily transportation between her lodging and work
site.
(See Naples Aff. at ¶¶ 25, 27-28, 31, 39, 42; Rebba Decl. at
¶ 8; Tr. of 1-27-08 Naples Dep. at 93; Tr. of Rebba Dep. at 121-24,
134-36; dkt. entry no. 168-9, Ex. 11 to White Decl., 10-28-05
E-mail Chain between Naples, Rebba, and Aparna Mazumdar.)
Naples alleges that Ranbaxy both established and funded the
full-time position before she left for India.
Naples Dep. at 94; Naples Aff. at ¶ 17.)4
(See Tr. of 10-27-08
She asserts that Ranbaxy
posted the position internally, that Rebba interviewed her for the
position, and that Rebba informed Naples that he intended to hire
(Naples Aff. at ¶¶ 17-19.)5
her.
Ranbaxy disputes that it ever
established or funded that position, and further disputes that
Rebba either interviewed Naples or had authority to hire Naples for
the position.
(See dkt. entry no. 184, Ranbaxy Response to Pls.’
SOF at ¶ 27; see also Rebba Decl. at ¶ 9.)
4
Both the plaintiffs and Ranbaxy have submitted excerpts of
the 10-27-08 Naples Deposition transcript. (See Tr. of 10-27-08
Naples Dep.; dkt. entry nos. 168-4 through 168-6, Ex. 9 to White
Decl., Tr. of 10-27-08 Naples Dep.) Citations to the transcript of
that deposition may relate to either or both of those submissions.
5
Although Naples asserts that Ranbaxy’s human resources
department approved the full-time position “and posted [it] within
Ranbaxy offices, as per HR policy” (Naples Aff. at ¶ 17), the
plaintiffs have not submitted a copy of that posting in their
opposition to the Ranbaxy Motion.
9
F.
Naples’s Time in India, at Ranbaxy Labs
Naples arrived in India on October 29, 2009.
She asserts that
she endured deplorable conditions throughout her stay.
at 9, 10.)
(Opp’n Br.
When Naples arrived at the New Delhi airport, she was
not, despite Ranbaxy’s assurances, met by a driver.
10-27-08 Naples Dep. at 96.)
(See Tr. of
Naples thus paid a driver to
transport her to her lodging, a guest house in Gurgaon.
at 97-99.)
(See id.
She characterizes the conditions at the guest house as
“despicable”, describing it as a “run-down dorm” located in a
dangerous area.
(Naples Aff. at ¶¶ 29, 31; dkt. entry no. 168-9,
Ex. 16 to White Decl., 11-1-05 E-mail from Naples to Christine
Pitcherello.)
She cites “weeks of no hot water, no heat,
inadequate amounts of towels and toilet paper, bed bugs, insects,
[and] lizards”.
(Naples Aff. at ¶¶ 29-30.)
Naples argues that she
suffered from both discomfort and humiliation based on her
inability to shower, and from “bug bites over my entire body [that]
made me so uncomfortable that I felt it ruined my life”.
(Id. at
¶¶ 51-52.)
Naples asserts that the working conditions at Ranbaxy Labs
were similarly “unbearable” (Opp’n Br. at 10), because she “was
treated like a prisoner and a slave while working for Ranbaxy in
India”.
(Naples Aff. at ¶ 55.)
Naples regularly worked more than
forty hours per week, and at times worked through weekends and
10
holidays, putting in as many as eighteen to twenty hours per day.
(See Naples Aff. at ¶¶ 39, 55, 57; Tr. of Rebba Dep. at 124,
126-27.)
She alleges that Ranbaxy did not allow her to leave her
work site for either lunch or dinner.
(Naples Aff. at ¶ 56.)
She
further alleges that Ranbaxy did not allow her to make outgoing
phone calls, denied her access to the internet, took her passport
from her, and refused to return it.
(See Naples Aff. at ¶¶ 34, 55,
60; Tr. of 10-27-08 Naples Dep. at 122-23; Tr. of 3-8-11 Naples
Dep. at 72.)
Naples corresponded with several friends during her stay in
India and chronicled her experiences.
On November 2, 2005, she
dispatched several copies of this message:
Hey, well it didn’t seem so bad here Wed [sic] at work,
but this morning was the last straw for me. There was
a 7x1.5 inch lizard in my room. The Guest House guys
told me it was a cockroach. I think there’s a language
problem. It was definitely a reptile. I told them
that I was moving out this morning, so I packed all my
things. I’m at work now, but I might try to find out
whether there is a shower at the office. I would
rather work all day and night than stay in the Guest
House. . . .
(Dkt. entry no. 168-10, Ex. 18 to White Decl., 11-2-05 E-mail from
Naples to Pitcherello; dkt. entry no. 168-10, Ex. 19 to White
Decl., 11-2-05 E-mail from Naples to Dileep Katta, Jeremy Collings,
and Stephanie Leaphart.)
In a later e-mail, she stated:
. . . I haven’t taken a nice shower in 2.5 weeks.
sick of cold showers!
11
I am
I’m miserable here. The work sucks. Nobody is helping
me do the work. I work all day and night. I get bitten
by bugs in the Guest House.
I listen to guys cough up flem [sic] all night. I don’t
even know how to spell that word. The conditions at the
Guest House are very unsanitary.
They wash my clothes, but they come out dirtier than
when I gave them to them to clean. . . .
Everybody here knows that I’m not happy with my living
and working conditions. . . .
To top it all off, I will probably go back to Princeton
and find out that I have no job.
Anyway, I told the executive Director/VP guy that things
suck here. The work sucks and the Guest House sucks.
The food is bad too and I’m not even a picky eater. I
usually eat whatever someone puts on my plate. But, I
refuse to eat something, unless I know what the
ingredients are. They can’t even tell me what I’m
eating. I’m sure that I’ve eaten a lot of bugs at the
Guest House.
Anyway, I should be home soon. The only thing I want to
do is take a long, hot shower. My life is ruined
without hot water. If I had hot water, I wouldn’t
complain about all these other things. I just want to
take a shower!!!!!!!
(Dkt. entry no. 168-10, Ex. 22 to White Decl., 11-17-05 E-mail from
Naples to Kevin Jezewski.)
Naples sent Rebba an e-mail on November 4, 2005, reaffirming
her interest in full-time employment with Ranbaxy.
(See dkt. entry
no. 172-2, Ex. CC to Sabatini Aff., 11-4-05 E-mail from Naples to
12
Rebba.)
It appears that Naples did not correspond with Rebba about
any issues relating to the guest house or her work conditions.
(But see Naples Aff. at ¶¶ 35-37 (describing Naples’s attempts to
reach Rebba by telephone).)
Naples asserts that she repeatedly attempted to address her
complaints about her living and working conditions with various
Ranbaxy and Ranbaxy Labs employees, including Rebba and Walia.
(See Naples Aff. at ¶¶ 35-38, 57-59; see also dkt. entry no.
168-10, Ex. 23 to White Decl., 11-17-05 E-mail from Naples to
Rebba.)
Walia denies that Naples spoke to him about the working
conditions at Ranbaxy Labs.
(See Walia Decl. at ¶ 7.)
Rebba and
Walia each acknowledge that Naples spoke to them about her living
conditions, and note that Naples was thereafter moved from the
guest house to The Bristol, a hotel in Gurgaon.
(See Rebba Decl.
at ¶ 10; Walia Decl. at ¶ 7 (“When I became aware of Naples’ [sic]
dissatisfaction with her living accommodations, that was resolved
by her being moved to the Bristol Hotel as soon as that move could
be made.
She did not complain to me about that hotel after she
moved there.”).)
Naples described The Bristol as a “nice hotel”.
(Dkt. entry
no. 168-11, Ex. 25 to White Decl., 11-21-05 E-mail from Naples to
Collings, Katta, and Leaphart.)
In an e-mail dated November 21,
2005, she stated:
13
. . . I will have a drink for you guys tonight. I’m
living the high life now and spending some money!
It is so nice to be able to take a hot shower.
(Dkt. entry no. 168-11, Ex. 26 to White Decl., 11-21-05 E-mail from
Naples to Collings.)
In a separate e-mail, she stated:
. . . I’m still in India.
water! I thought my life
a hotel (I was staying at
I had my first hot shower
better being able to take
Three weeks with no hot
was over. I’ve been moved to
a guest house, which sucked!).
on Saturday. Life is so much
a shower!
(Dkt. entry no. 168-11, Ex. 27 to White Decl., 11-22-05 E-mail from
Naples to Joanne Zagami Ziniti.)
Naples was originally scheduled to return home on November 20,
2005, but, at Ranbaxy Labs’s request, she extended her stay for
approximately four additional weeks.
(See Naples Aff. at ¶ 64;
dkt. entry no. 168-11, Ex. 28 to White Decl., 12-12-05 E-mail from
Naples to Collings.)
She asserts that at least one Ranbaxy Labs
employee told her that she “wouldn [sic] not get the permanent job”
unless she extended her stay, and finished the Ranbaxy Labs
assignment.
(Naples Aff. at ¶ 64.)
Naples fell ill before leaving India, in early December of
2005.
(See 12-12-05 E-mail from Naples to Collings (“I was very
sick last week.
Everything I ate came out both ends of my body!
I was sooooooooo sick!”); Naples Aff. at ¶ 84.)
e-mail dated December 12, 2005, that:
14
She stated in an
I kept telling them I was sick, but they wouldn’t listen
to me. Finally, I left work . . . and went back to my
hotel. They sent two doctors to give me some medicine.
(12-12-05 E-mail from Naples to Collings; see also Naples Aff. at
¶ 84 (“I requested medicine; however, my coworkers did not believe
that I was sick and did not send medicine until days later.”).)
Naples felt better after receiving the medicine, but fell ill again
a few days later, and remained ill until she returned to New
Jersey.
(Naples Aff. at ¶ 84; see also dkt. entry no. 168-11, Ex.
29 to White Decl., 12-16-05 E-mail from Naples to Hannah Hamilton.)
She claims that “the long hours and poor living conditions endured
while in India induced [her] illness.”
G.
(Naples Aff. at ¶ 85.)
Events Following Naples’s Return to New Jersey
Naples returned to New Jersey on or about December 16, 2005.
(See 12-16-05 E-mail from Naples to Hamilton.)
On December 21,
2005, Naples informed a friend that she had received “no word”
about the full-time position at Ranbaxy and had “written off the
job.”
(Dkt. entry no. 168-11, Ex. 31 to White Decl., 12-21-05
E-mail from Naples to Hamilton.)
Rebba thereafter informed Naples that the full-time position
was “on hold” and offered her a third six-month term as an
independent contractor.
(Rebba Decl. at ¶ 11; see dkt. entry no.
168-11, Ex. 34 to White Decl., 1-6-06 E-mail from Naples to
Mazumdar.)
Naples asserts that Rebba told her that the full-time
15
position would soon become available, and that she should not
worry.
(See Tr. of 3-8-11 Naples Dep. at 127-28, 133.)
It appears that Naples thereafter contacted Infotech, and
asked about the possibility of a twelve-month term as an
independent contractor.
Mazumdar.)
(See 1-6-06 E-mail from Naples to
Infotech responded:
[Bidlur] Shivaprakash, our CEO, has spoken to the client
and come up with the following feedback:
Client can only provide 6 month contract with good
possibility of extension after 6 months; . . .
bout [sic] joining them full time, at this stage they
have ruled out that possibility.
(Dkt. entry no. 168-11, Ex. 35 to White Decl., 1-16-06 E-mail from
Infotech to Naples.)
Naples agreed to extend the Software Services Agreement for
another six months, thus extending her term as an independent
contractor at Ranbaxy until June of 2006.
(See dkt. entry no.
172-1, Ex. F to Sabatini Aff., Third Purchase Order.)
The Third
Purchase Order, like the Second Purchase Order, provides that the
“end Client”, Ranbaxy, could terminate the Software Services
Agreement either with or without notice.
H.
(See id.)
Ranbaxy’s Termination of the Software Services Agreement
Rebba contacted Naples on March 28, 2006, to inform her that
April 21, 2006 would be her “roll-off” date, i.e., the last day
16
that Naples would serve Ranbaxy as an independent contractor.
(Dkt. entry no. 168-12, Ex. 44 to White Decl., 3-28-06 E-mail from
Rebba to Naples.)
Naples served Ranbaxy until March 31, 2006, and
was ultimately paid through April 21, 2006.
(See dkt. entry no.
168-12, Ex. 45 to White Decl., 3-31-06 E-mail from Rebba to
Shivaprakash; Naples Aff. at ¶ 68; see also dkt. entry no. 159,
8-15-12 Stipulation & Order.)
I.
Relevant Procedural Posture
The plaintiffs originally brought this action against Infotech
in state court, in Connecticut, on March 18, 2008.
no. 1, Ex. A to Removal Notice, Compl.)
(See dkt. entry
Infotech removed the
action to the United States District Court for the District of
Connecticut (“Connecticut District Court”).
Removal Notice.)
The plaintiffs thereafter amended the Complaint
to raise claims against Ranbaxy.
Compl.)
(See dkt. entry no. 1,
(See dkt. entry no. 24, Am.
Approximately ten and a half months had lapsed since the
plaintiffs originally brought the action against Infotech.
Ranbaxy moved before the Connecticut District Court to dismiss
the action for lack of personal jurisdiction.
44, Mot. to Dismiss.)
(See dkt. entry no.
That court agreed that personal jurisdiction
over Ranbaxy was lacking and transferred the action here pursuant
to 28 U.S.C. § 1404(a) to cure the lack of jurisdiction.
entry no. 71, 12-15-09 Ruling & Order at 1-2, 5-10.)
17
(See dkt.
Once here,
the plaintiffs filed the operative pleading, the Second Amended
Complaint.
II.
(See 2d Am. Compl.)
DISCUSSION
Ranbaxy now moves for summary judgment in its favor and
against the plaintiffs with respect to all of the claims asserted
against it in the Second Amended Complaint.
Mot.)
(See Notice of Ranbaxy
The Court, in the sections that follow, will address general
principles of choice of law analysis.
The Court will then address
the parties’ arguments concerning choice of law and substantive
law, on a claim-by-claim basis.
Before addressing those issues, however, it bears noting that
this is Ranbaxy’s third motion for summary judgment in the action.
Ranbaxy first moved for such relief in May of 2011.
entry no. 106, 5-12-11 Notice of Ranbaxy Mot.)
On that date,
Infotech also separately moved for summary judgment.
entry no. 116, 5-12-11 Notice of Infotech Mot.)
(See dkt.
(See dkt.
The Court denied
both of those motions without prejudice after concluding that the
parties had, collectively, failed to recognize the need for choice
of law analysis.
(See dkt. entry no. 135, 10-27-11 Order at 5.)6
6
The Court, upon review of both defendants’ motions and the
related records, found that the claims raised against Ranbaxy and
Infotech shared a common basis in both fact and, to some extent,
law. Nevertheless, without analysis or explanation, Ranbaxy and
Infotech relied on the laws of different forums, i.e., Connecticut
and New Jersey. (See 10-27-11 Order at 2.) This prompted both the
denial of the defendants’ motions and the Court’s request for
thorough and meaningful briefing on choice of law. (See id. at 5.)
18
Ranbaxy moved anew for relief on January 19, 2012.
entry no. 138, 1-19-12 Notice of Ranbaxy Mot.)7
(See dkt.
The Court again
denied Ranbaxy’s motion without prejudice, noting that Ranbaxy and
the plaintiffs had, despite the Court’s earlier instruction, failed
to thoroughly analyze the choice of law issues implicated by the
claims raised against Ranbaxy.
Order.)
(See dkt. entry no. 163, 8-17-12
See TekDoc Servs., LLC v. 3i-Infotech, No. 09-6573, 2012
WL 3564174, at *1 (D.N.J. Aug. 17, 2012).
The Court suggested in
obiter dictum that those claims appeared to implicate the laws of
Connecticut, New Jersey, and India.
3564174, at *1 n.5, *2-6.
See TekDoc Servs., 2012 WL
The Court included such dictum in an
effort to further the action, as it appeared that the parties would
otherwise continue to delay the disposition of the action.
See id.
at *1 n.5 (citing Landis v. N. Am. Co., 299 U.S. 248, 254 (1936)).
Ranbaxy filed the instant motion on November 26, 2012.
Notice of Ranbaxy Mot.)
(See
Upon that motion, both Ranbaxy and the
plaintiffs have, for the first time, meaningfully addressed the
choice of law and substantive issues relating to each claim raised
against Ranbaxy.
The Court is now thus prepared to analyze those
claims.
7
Infotech separately filed a new motion for summary judgment.
(See 1-17-12 Notice of Infotech Mot.) As stated in note 1, supra,
the Court granted that motion and entered judgment in Infotech’s
favor on all of the claims raised against it. (See 8-16-12 Order &
J.) See TekDoc Servs., 2012 WL 3560794.
19
A.
Choice of Law Rules
1.
The Court Will Apply New Jersey’s Choice of Law
Rules to the Claims Raised Against Ranbaxy
The parties dispute which state’s choice of law rules govern
the claims raised against Ranbaxy: i.e., Connecticut or New Jersey.
The Court, for the reasons that follow, will apply New Jersey’s
choice of law rules.
“In an action based on diversity of citizenship, a federal
court generally applies the choice-of-law rules of the jurisdiction
in which it sits.”
Amica Mut. Ins. Co. v. Fogel, 656 F.3d 167, 170
(3d Cir. 2011) (citing Klaxon Co. v. Stentor Elec. Mfg. Co., 313
U.S. 487, 496 (1941)).
Thus, if the plaintiffs had originally
brought the action here, then this Court would have applied New
Jersey’s choice of law rules.
See id.
(See 2d Am. Compl. at ¶¶ 1,
6 (demonstrating that the Court should deem both Naples and TekDoc
to be citizens of Connecticut and asserting jurisdiction pursuant
to 28 U.S.C. § 1332); Ranbaxy SOF at ¶ 3 (demonstrating that the
Court should deem Ranbaxy to be a citizen of both Delaware and New
Jersey); Pls.’ Response to Ranbaxy SOF at ¶ 3 (same).)
See also
Zambelli Fireworks Mfg. Co., Inc. v. Wood, 592 F.3d 412, 418 (3d
Cir. 2010) (A “corporation is a citizen both of the state where it
is incorporated and of the state where it has its principal place
of business”, and “the citizenship of a limited liability company
. . . is determined by the citizenship of each of its members.”).
20
An exception to this rule lies when an action is transferred
from one district court to another pursuant to Section 1404(a).
Section 1404(a) grants district courts discretion to transfer an
action to another district for the convenience of the parties and
in the interests of justice.
See 28 U.S.C. § 1404(a); Lafferty v.
St. Riel, 495 F.3d 72, 76-77 (3d Cir. 2007).
In that circumstance,
the transferee court applies the transferor forum’s choice of law
rules.
See Amica, 656 F.3d at 171.
Thus, if the Connecticut
District Court had transferred the action here for the convenience
of the parties and in the interests of justice, then this Court
would have applied Connecticut’s choice of law rules.
See id.
The 12-15-09 Ruling & Order demonstrates, however, that the
Connecticut District Court did not transfer the action for those
reasons.
Indeed, that court did not consider the factors normally
implicated by such a transfer.
See N.Y. Marine & Gen. Ins. Co. v.
Lafarge N. Am., Inc., 599 F.3d 102, 112 (2d Cir. 2010); Jumara v.
State Farm Ins. Co., 55 F.3d 873, 883 (3d Cir. 1995).
Instead, the
Connecticut District Court transferred the action to cure the lack
of personal jurisdiction over Ranbaxy that existed in that court.
(See 12-15-09 Ruling & Order at 1-2, 9-10.)8
8
Such transfer was proper under Section 1404(a) under the law
binding the Connecticut District Court. See, e.g., SongByrd, Inc.
v. Estate of Grossman, 206 F.3d 172, 179 n.9 (2d Cir. 2000) (noting
that Section 1404(a) grants district courts authority to cure lack
of personal jurisdiction by transferring an action to a district
court that may exercise such jurisdiction).
21
The plaintiffs argue that the Connecticut District Court
transferred the action here pursuant to Section 1404(a), and that
this Court must, pursuant to Lafferty, apply Connecticut’s choice
of law rules.
(See Opp’n Br. at 21.)9
In Lafferty, the United
States Court of Appeals for the Third Circuit (“Third Circuit”)
stated that distinctions between Section 1404(a) and 28 U.S.C.
§ 1406(a) (“Section 1406(a)”) concern “discretion, jurisdiction,
and choice of law.”
495 F.3d at 76.
The Third Circuit explained:
Section 1404(a) transfers are discretionary
determinations made for the convenience of the parties
and presuppose that the court has jurisdiction and that
the case has been brought in the correct forum. . . .
Section 1406(a) comes into play where plaintiffs file
suit in an improper forum. In those instances, district
courts are required either to dismiss or transfer to a
proper forum. . . . When cases have been transferred
for improper venue, transferee courts generally apply
the substantive law they would have applied had the
action been brought there initially.
Id. at 76-77 (citations omitted).
The Court has carefully considered the plaintiffs’ argument,
but concludes that their argument improperly emphasizes form over
substance.
It is undeniable that the Connecticut District Court
made a passing reference to Section 1404(a).
& Order at 1.)
(See 12-15-09 Ruling
But that Court spent considerable time justifying
9
Where application of Connecticut’s choice of law rules would
automatically result in dismissal of one of the plaintiffs’ claims,
pursuant to an applicable statute of limitations, the plaintiffs
have deemed fit to argue that New Jersey’s choice of law rules
should govern the action. (See Opp’n Br. at 54 n.12, 54-58.)
22
its conclusion that it was an improper forum for the action, and
demonstrating why the action should be transferred to this Court.
(See id. at 1-2, 5-10.)
Indeed, it appears that the Connecticut
District Court, if it had been bound by Lafferty, would have
transferred the action pursuant to Section 1406(a).10
The rationale underlying the Connecticut District Court’s
transfer thus controls this Court’s application of choice of law
rules. Because the Connecticut District Court transferred the
action to cure a lack of personal jurisdiction over Ranbaxy -despite its passing reference to Section 1404(a) -- this Court
cannot apply the transferor forum’s choice of law rules.
See Reyno
v. Piper Aircraft Co., 630 F.2d 149, 164-65 (3d Cir. 1980)
(reasoning that where a state’s “exercise of jurisdiction over [a
defendant] would violate due process, so would application of that
state’s choice of law rules”), rev’d on other grounds, 454 U.S. 235
(1981); Peckenpaugh v. Cargill, Inc., No. 84-721, 1986 WL 15610, at
*2 (D. Del. June 30, 1986).
This Court, accordingly, must apply
the choice of law rules of the transferee forum, New Jersey.
See
Nat’l Union Fire Ins. Co. of Pittsburgh, Pa. v. Am. Eurocopter
Corp., 692 F.3d 405, 408 n.3 (5th Cir. 2012) (citations omitted)
(“The choice-of-law rules of the transferee state apply if a
10
Insofar as Lafferty announced that transfer under Section
1406(a) is the proper mechanism for transfer to cure lack of
personal jurisdiction, that case conflicts with the law of the
United States Court of Appeals for the Second Circuit, which binds
the Connecticut District Court. See SongByrd, 206 F.3d at 179 n.9.
23
diversity suit was transferred from a district court that had no
personal jurisdiction over the defendant or where venue was
otherwise improper.”); SongByrd, 206 F.3d at 180; Peckenpaugh, 1986
WL 15610 at *2.11
Under New Jersey law, where “a choice-of-law determination is
necessary, it is made on an issue-by-issue basis”.
Cornett v.
Johnson & Johnson, 211 N.J. 362, 374 (2012) (citation omitted).
Such determinations “may result in the application of the law of
more than one [forum] to the several claims in a matter.”
(citation omitted).
Id.
Of course, “choice of law is not an issue
unless there is a real conflict between the law of” those forums.
Id. (citation omitted); see also P.V. ex rel T.V. v. Camp Jaycee,
197 N.J. 132, 143-44 (2008) (demonstrating that an “actual
conflict” exists where application of one forum’s laws over another
would be outcome determinative).
11
The Court applied Connecticut’s choice of law rules when
resolving Infotech’s motion for summary judgment. See TekDoc
Servs., 2012 WL 3560794, at *8-12. The application of those rules
did not violate Infotech’s due process rights because Infotech,
unlike Ranbaxy, consented to the Connecticut District Court’s
exercise of personal jurisdiction. (See, e.g., dkt. entry no. 25,
Infotech Answer to Am. Compl.) See Fed.R.Civ.P. 12(h)(1); Neifeld
v. Steinberg, 438 F.2d 423, 428 n.11 (3d Cir. 1971).
The Court notes, with respect to the resolution of Infotech’s
motion for summary judgment, that both Infotech and the plaintiffs
impliedly consented to the application of Connecticut’s choice of
law rules by basing their respective briefs on those rules. (See
dkt. entry no. 137, Br. in Supp. of Infotech Mot. at 7; dkt. entry
no. 149, Opp’n to Infotech Mot. at 13.) Neither Infotech nor the
plaintiffs argued that the Court should apply New Jersey’s choice
of law rules when resolving that motion.
24
The Court will thus examine the claims raised against Ranbaxy
and, on a claim-by-claim basis, determine which forum’s law governs
each claim.
Where Ranbaxy and the plaintiffs agree that a forum’s
law governs a claim, and thus consent to the application of that
forum’s law, the Court will not further analyze the choice of law
issues relating to that claim.12
in a three-step analysis.
Otherwise, the Court will engage
First, based on the facts underlying
each claim, the Court will determine which forums have an interest
in the resolution of that claim.
Second, the Court will determine
whether an actual conflict exists by determining whether a choice
of law determination would be outcome determinative.
Jaycee, 197 N.J. at 143.
See Camp
Third, where an actual conflict exists,
the Court will apply New Jersey’s choice of law rules to determine
which forum’s law governs the claim.
2.
New Jersey’s Choice of Law Rules
a.
Choice of Law Rules Concerning the Claims for
Breach of Contract and Breach of the Implied
Covenant of Good Faith and Fair Dealing
New Jersey courts resolve choice of law issues relating to
breach of contract claims by determining which forum has the most
12
Where parties’ briefs assume that a particular forum’s law
controls, “such ‘implied consent . . . is sufficient to establish
choice of law.’” Krumme v. WestPoint Stevens Inc., 238 F.3d 133,
138 (2d Cir. 2000) (quoting Tehran-Berkeley Civil & Envtl. Eng’rs
v. Tippetts-Abbett-McCarthy-Stratton, 888 F.2d 239, 242 (2d Cir.
1989)); see also Fed. Ins. Co. v. Am. Home Assurance Co., 639 F.3d
557, 566-67 (2d Cir. 2011); 1A C.J.S. Actions § 49 (2013).
25
significant relationship with both the parties and the contract.
See Jackson v. Midland Funding LLC, 468 Fed.Appx. 123, 126-27 (3d
Cir. 2012); Forestal Guarani S.A. v. Daros Int’l, Inc., 613 F.3d
395, 401 (3d Cir. 2010); State Farm Mut. Auto. Ins. Co. v. Estate
of Simmons, 84 N.J. 28, 34-37 (1980).
It appears that they would
similarly resolve choice of law issues in an action concerning a
breach of the implied covenant of good faith and fair dealing.
See
Wilson v. Amerada Hess Corp., 168 N.J. 236, 244-47 (2001)
(demonstrating that implied contractual covenants, like express
contractual covenants, arise from and relate to parties’ contract).
After all, “[t]he implied covenant of good faith and fair dealing
is used to measure a party’s performance under a contract”, and,
“[t]hus, a breach of the implied covenant [of good faith and fair
dealing] may give rise to a cause of action for damages for breach
of contract”.
1266 Apartment Corp. v. New Horizon Deli, Inc., 368
N.J. Super. 456, 461 (App. Div. 2004).
The New Jersey Supreme Court has adopted the principles set
forth in the Restatement (Second) of Conflicts of Laws, at Section
188 (respectively, “the Restatement” and “Section 188”) to resolve
such choice of law issues.
126.
See, e.g., Jackson, 468 Fed.Appx. at
Section 188 generally instructs courts to consider the
parties’ contacts with each forum, with particular importance paid
to the: (1) place of contracting; (2) place of negotiation of the
26
contract; (3) place of performance; (4) location of the subject
matter of the contract; and (5) domicil, residence, nationality,
place of incorporation, and place of business of the parties.
RESTATEMENT (SECOND)
OF
CONFLICT
OF
LAWS § 188(2).
“These contacts are to
be evaluated according to their relative importance with respect to
the particular issue.”
Id.; see also Camp Jaycee, 197 N.J. at 143
(noting that assessment of factors articulated by the Restatement
should be “qualitative, not quantitative”).
While Section 188 generally provides the choice of law rule
relevant to a breach of contract action, sections 189 through 199,
and 203, of the Restatement provide guidance in applying the
general rule to specific types of contracts.
Section 196 of the
Restatement (“Section 196”) is relevant to the action.
It provides
that the validity of and rights created by a contract for the
rendition of services should be determined “by the local law of the
state where the contract requires that the services, or a major
portion of the services, be rendered, unless, with respect to the
particular issue, some other state has a more significant
relationship . . . to the transaction and the parties.”
(SECOND)
OF
CONFLICT
OF
RESTATEMENT
LAWS § 196.
Although Section 196 has not been explicitly adopted by New
Jersey courts, this Court believes that the New Jersey Supreme
Court would, if presented with the proper action, adopt and apply
27
it.
Section 196 accords with the long-held understanding of New
Jersey law, which presumes that parties, in the absence of an
effective choice of law provision, “contract with reference to the
law of the [forum] in which the contract is to be performed.”
Mullaly v. Carlisle Chem. Works, Inc., 177 F.Supp. 588, 592 (D.N.J.
1959).
Furthermore, at least one New Jersey Appellate Division
panel has recognized that section’s general applicability.
See
McCabe v. Great Pac. Century Corp., 222 N.J. Super 397, 400 (App.
Div. 1998) (recognizing section 196 of the Restatement, which
applies to contracts for the rendition of services).
And New
Jersey courts have adopted other, related sections of the
Restatement.
See Gilbert Spruance Co. v. Pa. Mfrs.’ Ass’n Ins.
Co., 134 N.J. 96, 103-04 (adopting section 193 of the Restatement,
insofar as it applies to casualty insurance contracts); Keil v.
Nat’l Westminster Bank, Inc., 311 N.J. Super. 473, 486 (App. Div.
1998) (taking guidance from section 195 of the Restatement, which
concerns contracts for the repayment of loans); Gamino v. Gen. Am.
Life Ins. Co., 288 N.J. Super. 125, 132 n.1 (App. Div. 1996); see
also Nafar v. Hollywood Tanning Sys., Inc., 339 Fed.Appx. 216, 220
(3d Cir. 2009) (Under New Jersey law, the “second prong of the most
significant relationship test requires the Court to weigh the
factors enumerated in the Restatement section corresponding to the
plaintiffs’ cause of action.”)
28
b.
Choice of Law Rules Concerning the Claims for
Misrepresentation, Fraud, and Negligent
Infliction of Emotion Distress
The New Jersey Supreme Court has also adopted sections of the
Restatement concerning resolution of choice of law issues relating
to tort claims.
See Camp Jaycee, 197 N.J. at 141-43, 144-47
(analyzing and applying the factors and presumptions set forth in
sections 145, 146, and 148 of the Restatement).
Those sections,
like the sections concerning claims for breach of contract,
announce a “most significant relationship” standard.
RESTATEMENT (SECOND)
OF
CONFLICT
OF
LAWS §§ 145, 146, 148.
See id.;
As applied to
tort claims, the most significant relationship standard measures
each forum’s relationship with “the occurrence and the parties”.
Camp Jaycee, 197 N.J. at 145 (quoting RESTATEMENT (SECOND)
OF
CONFLICT
OF
LAWS § 146).
Section 145 of the Restatement (“Section 145”) provides that
parties’ rights and liabilities are determined by the forum that,
with respect to a particular claim, “has the most significant
relationship to the occurrence and the parties”.
OF
CONFLICT
OF
LAWS § 145(1).
RESTATEMENT (SECOND)
Generally, and pursuant to the New
Jersey Supreme Court’s interpretation of the Restatement, the law
of the forum where the plaintiff’s injury occurred applies unless
some other forum has a more significant relationship to the
occurrence and the parties.
See Camp Jaycee, 197 N.J. at 143; cf.
29
RESTATEMENT (SECOND) CONFLICT
OF
LAWS § 156(2) (“The applicable law will
usually be the local law of the state where the injury occurred.”)
To determine the significance of each forum’s relationship, courts
should consider the strength of each forum’s contacts with the:
(1) place where the injury occurred; (2) place where the conduct
causing the injury occurred; (3) domicil, residence, nationality,
place of incorporation, and place of business of the parties; and
(4) place where the parties’ relationship, if any such relationship
exists, is centered.
RESTATEMENT (SECOND) CONFLICT
see Camp Jaycee, 197 N.J. at 145-47.
OF
LAWS at § 145(2);
These contacts, like the
contacts considered in choice of law analyses concerning breach of
contract claims, are also “to be evaluated according to their
relative importance with respect to the particular issue.”
RESTATEMENT (SECOND) CONFLICT
OF
LAWS § 145(2); see also Camp Jaycee, 197
N.J. at 143 (noting that assessment of factors articulated by the
Restatement should be “qualitative, not quantitative”).
While Section 145 generally provides the choice of law rule
relevant to a tort action, section 148 of the Restatement (“Section
148”) provides guidance in applying the general rule to claims for
fraud or misrepresentation.
rules.
Specifically, Section 148 provides two
The first applies where the defendant’s allegedly tortious
conduct and the plaintiff’s reliance thereon all arise in a single
forum.
See RESTATEMENT (SECOND) CONFLICT
30
OF
LAWS § 148(1).
In that set
of circumstances, Section 148 presumes the application of that
forum’s law.
See id. § 148 cmt. d (“The state selected by
application of the rule of Subsection (1) will usually be the state
of dominant interest, since the two principal elements of the tort,
namely, conduct and loss, occurred within its territory.”); see
also Beegal v. Park W. Gallery, 394 N.J. Super. 98, 123 (App. Div.
2007) (recognizing this principle).
The second rule applies where
the “plaintiff’s action in reliance took place in whole or in part
in a state other than that where the false representations were
made and received”.
Id. at § 148(2).
In that set of
circumstances, to determine which forum has the most significant
relationship with the occurrence and parties, the Court should
consider:
(a) the place, or places, where the plaintiff acted in
reliance upon the defendant's representations,
(b) the place where the plaintiff received the
representations,
(c) the place where the defendant made the
representations,
(d) the domicil, residence, nationality, place of
incorporation and place of business of the parties,
(e) the place where a tangible thing which is the
subject of the transaction between the parties was
situated at the time, and
(f) the place where the plaintiff is to render
performance under a contract which he has been induced
to enter by the false representations of the defendant.
31
Id. § 148(2).
New Jersey courts recognize the “general approach”
that the law of the forum where a plaintiff acts in reliance on a
defendant’s representations will usually apply.
Kennedy v.
Unlimited Imports Inc., No. A-5906-05T2, 2007 WL 135951, at *4
(N.J. App. Div. Jan. 22, 2007) (citing RESTATEMENT (SECOND) CONFLICT
LAWS § 148 cmt. j).
OF
New Jersey courts also recognize that “[t]he
place of injury is less significant in a fraud action than in a
personal injury action.”
RESTATEMENT (SECOND) CONFLICT
c.
Beegal, 394 N.J. Super. at 122 (citing
OF
LAWS § 145(2) cmt. f).
Choice of Law and Statutes of Limitations
The plaintiffs argue, by reference to an unpublished
Connecticut trial court opinion discussing statutes of repose, that
“statutes of limitation [sic] can be treated as either substantive
law or procedural law depending on the cause of action”.
(Opp’n
Br. at 39 (citing Moore v. Arvin Indus., Inc., No. 085018503S, 2011
WL 6413827, at *2 (Conn. Super. Ct. Dec. 2, 2011)).)
However, the
relevance of the plaintiffs’ argument rests on the assumption that
Connecticut’s choice of law rules govern the resolution of the
claims raised against Ranbaxy.
For the reasons already discussed,
this is a faulty assumption.
Because New Jersey’s choice of law rules govern the resolution
of the claims raised against Ranbaxy, we turn to that state’s
courts for instruction.
32
In Heavner v. Uniroyal, Inc., 63 N.J. 130, 135–42, 305
A.2d 412 (1973), [the New Jersey Supreme] Court rejected
the rule that the statute of limitations of the forum
state automatically applies. The Court held a New
Jersey court will apply the statute of limitations of
another state, if that state has a greater interest in
the litigation. Id. at 140–41, 305 A.2d 412. In Gantes
v. Kason Corp., 145 N.J. 478, 484, 679 A.2d 106 (1996),
this Court held that when this state and another state
have conflicting statutes of limitations, we apply the
same [choice of law] test governing choice of
substantive law.
Cornett, 211 N.J. at 373-74; see also O’Boyle v. Braverman, 337
Fed.Appx. 162, 166 (3d Cir. 2009); Warriner v. Stanton, 475 F.3d
497, 500 n.2 (3d Cir. 2007).
Accordingly, where this Court’s
choice of law analysis reveals an actual conflict between two or
more forums’ statutes of limitations -- when it appears that one
forum’s statute of limitations would allow a claim to proceed,
whereas another would defeat it -- this Court will apply the same
choice of law rules as it would have applied if it were determining
which forum’s substantive law would govern resolution of that claim
on the merits.
See Cornett, 211 N.J. at 373-74; see also Ghaffari
v. Hern, No. 06-931, 2009 WL 2147092, at *4 (D.N.J. July 15, 2009)
(resolving conflict between New Jersey’s and Florida’s statutes of
limitations by reference to New Jersey’s choice of law rules).
33
B.
Analysis of the Claims Raised Against Ranbaxy
1.
The Summary Judgment Standard
Summary judgment is appropriate if the movant shows that there
is no genuine dispute as to any material fact, and is thus entitled
to judgment as a matter of law.
Fed.R.Civ.P. 56(a).
The Court
will grant a motion for summary judgment when 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.”
Catrett, 477 U.S. 317, 323 (1986).
Celotex Corp. v.
A dispute is “genuine” if “the
evidence is such that a reasonable jury could return a verdict for
the non-moving party”, and a fact is “material” if it might affect
the outcome of the suit under the applicable rule of law.
Anderson
v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986).
The Court will not deny a motion for summary judgment unless
the non-moving party has produced at least some evidence in support
of each material fact.
See Fed.R.Civ.P. 56(c)(1)(A).
The non-
moving party must “do more than simply show that there is some
metaphysical doubt as to the material facts.”
Matsushita Elec.
Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 586 (1986).
Neither speculation and conjecture, nor inferences drawn on the
same, will defeat a motion for summary judgment.
34
See Kovalev v.
City of Phila., 362 Fed.Appx. 330, 331 (3d Cir. 2010); Robertson v.
Allied Signal, Inc., 914 F.2d 360, 382 n.12 (3d Cir. 1990).
2.
The Claims for Breach of Contract and Breach of the
Implied Covenant of Good Faith and Fair Dealing
The claims for breach of contract and breach of the covenant
of good faith and fair dealing, insofar as they are viable, are
premised on two sets of allegations.13
First, the plaintiffs claim
that Ranbaxy breached an oral contract to convert Naples from an
independent contractor to a full-time Ranbaxy employee.
(See 2d
Am. Compl. at Ninth Count, ¶ 15(c); see also Br. in Supp. at 36;
Opp’n Br. at 23, 41.)
Second, they claim that Ranbaxy breached a
separate contract relating to the Naples’s assignment in India, by
failing to inform Naples of, or respond to or otherwise properly
redress her complaints about the living and working conditions in
India.
(See 2d Am. Compl. at Ninth Count, ¶ 15(a), (d)-(r); see
also Br. in Supp. at 36; Opp’n Br. at 23, 41, 62.)14
Because those
13
These claims are no longer viable insofar as they concern
Ranbaxy’s alleged failure to properly remit certain payments
because Ranbaxy and the plaintiffs have reached a settlement on
that issue. (See 8-15-12 Stipulation & Order; 2d Am. Compl. at
Ninth Count, ¶ 15(b), (s)-(t) and Twelfth Count, ¶¶ 26-27.)
14
The claim for breach of the implied covenant of good faith
and fair dealing is, as discussed above, a claim for breach of
contract. See Wilson, 168 N.J. at 244-47; 1266 Apartment Corp.,
368 N.J. Super. at 461. Because that claim is premised on the same
allegations as the claim for breach of contract, and because that
claim is, effectively, duplicative of the claim for breach of
contract, the Court will resolve both claims together and refer to
them as “the breach of contract claims”.
35
allegations are factually distinct, the Court will separately
address them.
a.
The Contract for Permanent Employment
Both Ranbaxy and the plaintiffs agree that the breach of
contract claims, insofar as they concern the alleged contract for
full-time employment at Ranbaxy, are governed by New Jersey law.
(See Br. in Supp. at 36-40 (applying New Jersey law to the First
Breach of Contract Claim); Opp’n Br. at 24, 41, 42-46 (same).)
Court will thus apply New Jersey law to those claims.
The
See Fed.
Ins. Co., 639 F.3d at 566-67; Krumme, 238 F.3d at 138.
Ranbaxy does not concede that it contracted to provide Naples
with full-time employment.
(See Br. in Supp. at 37 (arguing that
such a finding is “a fact that is not supported by the evidence”).)
Nevertheless, the Ranbaxy Motion is ripe for summary judgment.
Even assuming arguendo that such a contract existed, the plaintiffs
cannot carry the burden of proof with respect to an essential
element of each of those claims: a breach of contract.
See Video
Pipeline, Inc. v. Buena Vista Home Entm’t, Inc., 275 F.Supp.2d 543,
566 (D.N.J. 2002) (reciting elements of a New Jersey breach of
contract claim).
“‘In New Jersey, an employer may fire an employee for good
reason, bad reason, or no reason at all under the employment-atwill doctrine.
An employment relationship remains terminable at
36
the will of either an employer or employee, unless an agreement
exists that provides otherwise.’”
Wade v. Kessler Inst., 172 N.J.
327, 338 (2002) (quoting Witkowski v. Thomas J. Lipton, Inc., 136
N.J. 546, 552 (1994)); see Velantzas v. Colgate-Palmolive Co.,
Inc., 109 N.J. 189, 191 (1988) (“An employer can fire an at-will
employee for no specific reason or simply because an employee is
bothering the boss.”)
“Today, both employers and employees
commonly and reasonably expect employment to be at-will, unless
specifically stated in explicit, contractual terms.”
Bernard v.
IMI Sys., Inc., 131 N.J. 91, 106 (1993).15
The Court has carefully reviewed and considered the record.
It is bereft of evidence demonstrating that the alleged contract
for full-time employment -- or, as the plaintiffs have often
described it, “permanent” employment -- was for anything other than
at-will employment.
In the absence of such evidence, the Court
concludes that the alleged contract, if it existed, was merely for
at-will employment.
See id.
Accordingly, Ranbaxy was free to
terminate that contract at any time, even pre-employment, without
15
New Jersey courts recognize exceptions to the employmentat-will doctrine. See Wade, 172. N.J. at 338-39; Witkowski, 136
N.J. 552-53; Velantzas, 109 N.J. at 191-92. But the plaintiffs
have not argued that any of those exceptions apply here, and the
Court will not create such arguments on their behalf. See Perkins
v. City of Elizabeth, 412 Fed.Appx. 554, 555 (3d Cir. 2011) (“[A]
court is not obligated to scour the record to find evidence that
will support a party’s claims. . . . Courts cannot become
advocates for a party by doing for that party what the party ought
to have done for him or herself.”).
37
liability for breach of contract.
See Velantzas, 109 N.J. at 191;
see also Martin v. Port Auth. Transit Corp., No. 09-3165, 2010 WL
1257730, at *5 (D.N.J. Mar. 25, 2010) (employer may rescind an
offer for or terminate a contract for at-will employment freely,
and without incurring liability for breach of contract).
The plaintiffs raise two arguments to shield Naples from the
consequences of the employment-at-will doctrine.
First, they argue
that Naples was not an at-will employee who could be terminated at
any time because she was merely “a temporary employee with a
promise to be made a full-time, permanent employee.”
44.)
(Opp’n Br. at
This argument misplaces temporal emphasis; it improperly asks
the Court to consider Naples’s status as “a temporary employee”,
i.e., an independent contractor, when the alleged contract was
formed.
Her status at formation is irrelevant.
Instead, the
status created by the alleged contract -- her potential status as
“a full-time, permanent” employee -- guides the Court.16
The plaintiffs next argue that Naples should not be treated as
an at-will employee because, by accepting the assignment in India,
she provided additional consideration for the promise of
“permanent” employment.
(See Opp’n Br. at 45.)
16
They contend by
Even if the Court accepted Naples’s premise and treated her
as a “temporary employee”, the Court would reach the same result.
Under the contract that controlled Naples’s term as an independent
contractor, the Software Services Agreement, Ranbaxy enjoyed the
right to terminate the parties’ relationship at any time, and for
any reason, with or without notice. (See Third Purchase Order.)
38
reference to a New Jersey trial court case that “where additional
consideration is given, an employee is not classified as an at-will
employee, but rather can be terminated only for just cause.”
(Id.
(citing Alter Resorts Int’l, Inc., 234 N.J. Super. 409, 416 (Ch.
Div. 1989).)
The Court acknowledges that New Jersey courts have, in some
limited contexts, approved contracts for “permanent” employment.
But those contracts differ in kind from the alleged contract that
is here at issue.
As noted above, Naples “believed a permanent
position to mean that [she] would be made a full-time employee,
rather than a temporary employee”.
(Naples Aff. at ¶ 7.)
She did
not, by contrast to the New Jersey cases that discuss permanent
employment, believe that Ranbaxy would offer her a contract for
lifetime employment.
(See id.; Tr. of 10-27-08 Naples Dep. at 55
(showing that Naples understood the possible “permanent assignment”
to constitute “full-time”, not lifetime, employment at Ranbaxy).)
But cf. Fregara v. Jet Aviation Bus. Jets, 764 F.Supp. 940, 942
(D.N.J. 1991) (discussing an alleged contract for lifetime
employment); Savarese v. Pyrene Mfg. Co., 9 N.J. 595, 597 (1952)
(discussing an alleged promise for “a foreman’s job for the rest of
[the plaintiff’s] life”); Alter, 234 N.J. Super. at 416 (discussing
“lifetime contracts”).
Because the “permanent” employment at issue
here differs fundamentally from that discussed and in Fregara,
39
Savarese, and Alter, and because the plaintiffs have failed to cite
any authority that would otherwise support their argument, the
Court has concluded that this argument lacks merit.
b.
The Contract Relating to the Living and
Working Conditions in India
The second aspect of the breach of contract claims concerns
Naples’s assignment at Ranbaxy Labs, in India, and Ranbaxy’s
related responsibilities.
The plaintiffs seek relief for Ranbaxy’s
alleged failure to inform Naples of, or respond to or otherwise
properly redress her complaints about the living and working
conditions in that country.
(See 2d Am. Compl. at Ninth Count
¶ 15(a), (d)-(r); see also Br. in Supp. at 36; Opp’n Br. at 23,
41.)
Ranbaxy contends, by reference to well-reasoned choice of law
analysis, that this aspect of the breach of contract claims should
be governed by the law of India.
(See Br. in Supp. at 43-44.)
The
plaintiffs, by contrast, do not set forth a cogent choice of law
analysis.
They instead suggest that this aspect of the breach of
contract claims might be governed by the laws of either New Jersey
or India.
(See Opp’n Br. at 40 (“[E]ither New Jersey or India has
the most significant relationship with [the] plaintiffs’ breach of
contract claims for Naples’ [sic] services in India.”); id. at
46-50 (presenting substantive argument by reference to cases
interpreting New Jersey law).
But see id. at 47 (asserting without
40
further explanation “that the outcome of the most significant
relationship test for all of plaintiffs’ claims, including breach
of contract ends up being New Jersey”).)
Because Ranbaxy and the
plaintiffs have put the laws of both India and New Jersey at issue,
the Court must consider whether an actual conflict arises from the
application of those laws.
See Camp Jaycee, 197 N.J. at 143.
Such conflict arises from the application of each forum’s
statute of limitations to this aspect of the breach of contract
claims, which is rooted in facts dating back to October, November,
and December of 2005.
Rebba first approached Naples about the
assignment in India in October of 2005, and discussed the terms of
that assignment with her.
(See Rebba Decl. at ¶ 8; 10-24-05 Letter
from Walia to Naples; Tr. of Rebba Dep. at 114-15.)
Those terms
included Ranbaxy’s agreement to provide Naples with certain
services in India, including lodging, transportation from the
airport, and daily transportation between her lodging and Ranbaxy
Labs.
(See Naples Aff. at ¶¶ 25, 27-28, 31, 39, 42; Rebba Decl. at
¶ 8; Tr. of 1-27-08 Naples Dep. at 93; Tr. of Rebba Dep. at 121-24,
134-36; 10-28-05 E-mail Chain Between Naples, Rebba, and Mazumdar.)
Naples then traveled to India, where she lived and worked until
returning to New Jersey on or about December 16, 2005.
(See
12-16-05 E-mail from Naples to Hamilton (indicating that Naples
left India on or about 12-16-05).)
41
The plaintiffs did not bring suit against Ranbaxy until
February 4, 2009, more than three years after Naples returned from
India.
(See dkt. entry no. 24, Am. Compl.)
Accordingly, the
action, insofar as it is brought against Ranbaxy, is timely under
New Jersey law but time-barred by the law of India; New Jersey
provides a six-year statute of limitations for recovery for breach
of contract, whereas India provides only a three-year statute of
limitations.
Compare N.J.S.A. § 2A:14-1 (“Every action at law . .
. for recovery upon a contractual claim or liability, express or
implied, . . . shall be commenced within 6 years next after the
cause of any such action shall have accrued.”), with The Limitation
Act, No. 36 of 1963, INDIA CODE, available at http://indiacode.nic.in
(click “Short Title”, enter the words “Limitation Act”, and click
the “Submit” button) [hereinafter “Limitation Act”].17
The
Schedule attached to the Limitation Act expressly provides a three
year limitations period for actions “[f]or compensation for the
breach of any contract”, which begins to run “[w]hen the contract
is broken”.
See Limitation Act, at Schedule, First Div., Pt. II,
No. 55; see also Limitation Act at § 21 (“Where after the
institution of a suit, a new plaintiff or defendant is substituted
17
This website is the official website of the India Code, as
maintained by the government of India. See Nat’l Portal of India,
http://india.gov.in/topics/law-justice/enactment-laws (last visited
May 20, 2013) (describing the hyperlink appearing in the text of
this memorandum opinion as the “Official website of India Code”,
which “contains all the Central legislations”).
42
or added, the suit shall, as regards him, be deemed to have been
instituted when he was so made a party.”)
Because these forums present an actual conflict of laws, the
Court has examined the record to determine which forum, as between
them, has the most significant relationship with the parties and
contract at issue.
See Jackson, 468 Fed.Appx. at 126-27; Cornett,
211 N.J. at 373-74.
Following careful consideration of the record,
the Court concludes that India has that relationship.
The Court acknowledges that New Jersey has at least some
contacts with both Ranbaxy and the plaintiffs, who negotiated and
formed the contract at issue in New Jersey, in October of 2005.
(See Rebba Decl. at ¶ 8; Tr. of Rebba Dep. at 114-15; 10-24-05
Letter from Walia to Naples.)
LAWS § 188(2)(a)-(b).
See RESTATEMENT (SECOND)
OF
CONFLICT
The Court also acknowledges that Ranbaxy
maintains its principal place of business in New Jersey.
(See
Ranbaxy SOF at ¶ 3; Pls.’ Response to Ranbaxy SOF at ¶ 3.)
RESTATEMENT (SECOND)
OF
OF
CONFLICT
OF
See
LAWS § 188(2)(e).
The Court nevertheless concludes that India has the most
significant relationship with the parties and the contract at
issue.
See Camp Jaycee, 197 N.J. at 143 (instructing courts to
consider the quality, rather than the quantity, of contacts with a
given forum); RESTATEMENT (SECOND)
OF
CONFLICT
OF
LAWS § 188(2).
The
contract at issue called for both Ranbaxy and the plaintiffs to
43
render services in India.
Accordingly, the Restatement instructs
the Court to presume that India’s law should control any claims
arising from that contract.
See RESTATEMENT (SECOND)
OF
CONFLICT
OF
LAWS
§ 196 (instructing that choice of law issues should be resolved “by
the local law of the state where the contract requires that the
services, or a major portion of the services, be rendered . . . .”).
RESTATEMENT (SECOND)
OF
CONFLICT
OF
LAWS § 196.
The contract at issue
required the plaintiffs to render services for Ranbaxy in India,
and required Ranbaxy to provide Naples with lodging in India, to
provide Naples with local transportation in India, and, to provide
generally acceptable living and working conditions in India.
(See
Rebba Decl. at ¶ 8; 10-24-05 Letter from Walia to Naples; Tr. of
10-27-08 Naples Dep. at 96; see also Opp’n Br. at 48-49
(recognizing same).)
Those contacts are central to this aspect of
the breach of contract claims.
The Court’s conclusion regarding the application of the law of
India is further buttressed by Ranbaxy’s and the plaintiffs’ other
contacts with India.
Nearly all of the plaintiffs’ complaints,
insofar as they arise from this aspect of the breach of contract
claims, recognize India as the forum where Ranbaxy allegedly failed
to provide services.
(See Tr. of 10-27-08 Naples Dep. at 96,
122-23; Tr. of 3-8-11 Naples Dep. at 72; Naples Aff. at ¶¶ 29-31,
34-39, 51-52, 55-60, 84-85; 11-1-05 E-mail from Naples to
44
Pitcherello; 11-2-05 E-mail from Naples to Pitcherello; 11-17-05
E-mail from Naples to Rebba; 12-12-05 E-mail from Naples to
Collings; 12-16-05 E-mail from Naples to Hamilton; see also 2d Am.
Compl. at Ninth Count, ¶ 15(d)-(r).)
OF
LAWS § 188(c).
See RESTATEMENT (SECOND) CONFLICT
Similarly, to the extent that the plaintiffs
suffered damages, such damages were felt in India.
(See Tr. of
10-27-08 Naples Dep. at 96-99 (discussing damages relating to lack
of transportation); Naples Aff. ¶¶ 29-30, 51-52, 84-85 (discussing
issues arising from the living and working conditions in India);
11-2-05 E-mail from Naples to Pitcherello (describing living
conditions); 11-17-05 E-mail from Naples to Jezewski (same);
12-16-05 E-mail from Naples to Hamilton (describing Naples’s
illness, which allegedly arose from Naples’s living and working
conditions and began affecting her while she was in India).)
Because the Court concludes that India has the most
significant relationship with the parties and the contract at
issue, it follows that India has the greatest interest in applying
its law, including its statute of limitations.
Cf. Jackson v.
Midland Funding, LLC, 754 F.Supp.2d 711, 716 (D.N.J. 2010), aff’d,
468 Fed.Appx. 123 (applying Pennsylvania’s statute of limitations
after determining that Pennsylvania had the greater relationship
with the parties and contract at issue, and the greater interest in
having its law applied to claims involving those parties and that
45
contract).
Accordingly, the second aspect of the breach of
contract claims is time-barred.
3.
The Claim for Unjust Enrichment
The plaintiffs, through the claim for unjust enrichment, now
seek “the value of services performed for and on behalf of Ranbaxy
for their benefit for which [TekDoc] has not been compensated”.
(See id. at Eleventh Count, ¶ 24.)
It appears that this claim was
settled, insofar as it concerned Ranbaxy’s alleged failure to
properly remit certain payments to TekDoc.
(See 8-15-12
Stipulation & Order (noting settlement of claims relating to “comp
time” and travel expenses).)
But the plaintiffs now argue that
“Ranbaxy still owes additional amounts to plaintiffs”, and purport
to “make[] a claim for work development that Ranbaxy benefits from
although Naples had to endure deplorable living and working
conditions, and being treated [sic] like a prisoner and slave while
providing this benefit.”
(Opp’n Br. at 54 (citations to record
omitted).)
The Court finds two issues with this argument.
First, it
appears that the plaintiffs neither made a claim for such “work
development” in the Second Amended Complaint, nor otherwise
demanded as much from Ranbaxy during the course of litigation.
(See 2d Am. Compl. at Eleventh Count; dkt. entry no. 172-2, Ex. W
to Sabatini Aff., Summary of Naples’s Losses.)
46
The Court will not
allow the plaintiffs to effectively amend their pleading at this
late stage.
See Warfield v. SEPTA, 460 Fed.Appx. 127, 132 (3d Cir.
2012) (“A plaintiff may not amend a complaint by raising arguments
for the first time in a brief in opposition to a motion for summary
judgment.”); Torske v. DVA Health & Nutrition GmbH, No. 11-3609,
2013 WL 1848120, at *5 (D.N.J. Apr. 30, 2013) (citation omitted)
(“[I]t is axiomatic that a plaintiff may not amend his complaint
through later briefing[.]”)
Second, even if the Court considered the merits of this claim,
and did so, as the plaintiffs urge, under New Jersey law (see Opp’n
Br. at 54-55), the Court would nonetheless conclude that this claim
is untenable.
“To establish unjust enrichment, a plaintiff must
show both that defendant received a benefit and that retention of
that benefit without payment would be unjust.
The unjust
enrichment doctrine requires that plaintiff show that it expected
remuneration from the defendant at the time it performed or
conferred a benefit on defendant and that the failure of
remuneration enriched defendant beyond its contractual rights.”
VRG Corp. v. GKN Realty Corp., 135 N.J. 539, 554 (1994) (emphasis
added) (citations omitted).
The plaintiffs do not claim that Ranbaxy received a benefit
without payment.
They instead attempt to breathe life into an
otherwise settled claim for unjust enrichment by shoehorning facts
47
that support time-barred breach of contract and, as discussed
below, tort claims.
Thus, the Court will not allow this claim to
remain viable.
4.
The Claim for Innocent Misrepresentation
The plaintiffs have raised a claim against Ranbaxy for
innocent misrepresentation.
Count.)
(See 2d Am. Compl. at Fourteenth
The Court, when resolving Infotech’s motion for summary
judgment, earlier concluded that New Jersey does not recognize such
a cause of action.
See TekDoc Servs., 2012 WL 3560794, at *11.
The plaintiffs now “concede that said claim does not exist in
. . . New Jersey and hereby abandon their claim for innocent
misrepresentation.”
(Opp’n Br. at 58.)
Because the plaintiffs
have expressly withdrawn that claim, the Court will not further
address it.
5.
The Claim for Negligent Infliction of Emotional
Distress
The parties have argued the merits of the claim for negligent
infliction of emotional distress (“NIED”) under the laws of both
India and New Jersey.
58-59.)
(See Br. in Supp. at 64-67; Opp’n Br. at
The Court, accordingly, must determine whether the
application of one forum’s law over the other would present an
actual conflict.
See Camp Jaycee, 197 N.J. at 143.
The laws of India and New Jersey conflict, insofar as New
Jersey provides a two-year limitations period for claims for
48
negligent infliction of emotional distress, and India provides only
a one-year limitations period for such claims.
Compare N.J.S.A. §
2A:14-2 and Carino v. O’Malley, No. 05-5814, 2007 WL 951953, at *9
(D.N.J. Mar. 28, 2007), with The Limitation Act at Schedule, First
Div., Pt. VII, No. 79 (providing a one-year limitations period,
that accrues from “[t]he date of the distress”, to any claim for
“compensation for . . . illegal, irregular, or excessive
distress”).
It appears, however, that the differences between
these forums’ statutes of limitations are, as applied here,
differences without distinction.
Under either statute, the claim
for NIED is time-barred.
The plaintiffs premise this claim on Ranbaxy’s knowledge,
whether real or imputed, “that failure to exercise due care in the
performance of the contract, the circumstances of the India
assignment[,] the failure to fulfill the promises of full time
employment[,] and the termination of plaintiff [sic] would cause
. . . Naples severe emotional distress.”
Fifteenth Count, ¶ 31.)
(2d Am. Compl. at
Ranbaxy terminated its relationship with
the plaintiffs on March 31, 2006, and the plaintiffs brought the
action against Ranbaxy approximately thirty-four months later, on
February 4, 2009.
(See 3-31-06 E-mail from Rebba to Shivaprakash;
Am. Compl.)
49
The plaintiffs argue that the Court should apply New Jersey
law, which provides the longer of the two potentially applicable
statutes of limitations.
(See Opp’n Br. at 47, 58-59.)
The
plaintiffs also argue that the Court should deem that New Jersey’s
statute of limitations was tolled on March 18, 2008, when they
originally brought the action in state court against only Infotech.
(See id. at 58-59.)
They rely principally on Mitzner v. W.
Ridgelawn Cemetery, Inc., 311 N.J. Super. 233, 239-40 (App. Div.
1998).
The plaintiffs’ reliance on Mitzner is misplaced.
Mitzner,
and cases like it, rest on New Jersey jurisprudence concerning
“substantial compliance” with that state’s statute of limitations.
See, e.g., Berke v. Buckley Broad. Corp., 359 N.J. 587, 596-601
(App. Div. 2003) (discussing the history and detailing the
evolution of New Jersey’s substantial compliance).
The Berke court
explained:
Unswerving, “mechanistic” application of statutes of
limitations would at times inflict obvious and
unnecessary harm upon individual plaintiffs without
advancing these legislative purposes. On numerous
occasions we have found “such particular circumstances
as to dictate not the harsh approach of literally
applying the statute of limitations but the application
of the more equitable and countervailing considerations
of individual justice.”
Id. (quoting Galligan v. Westfield Centre Serv., Inc., 82 N.J. 188,
192 (1980) (internal citations omitted)).
50
In each of the cases
discussed in Berke -- including Mitzner -- the plaintiff timely
filed the complaint against the defendant, but, for some reason,
originally brought the action before the wrong court.
The Mitzner plaintiff, for example, timely filed the complaint
against the defendants in New York, where the case was dismissed
for lack of personal jurisdiction.
See 311 N.J. Super. at 235.
The plaintiff then recommenced the action against the same
defendants in New Jersey.
See id.
Although the New Jersey filing
technically fell outside of the New Jersey statute of limitations,
the New Jersey appellate court deemed the complaint to be timely
filed pursuant to the doctrine of substantial compliance.
at 239-40.
See id.
That court explained:
In the instant case, the timely filing in New York and
the service of process were “‘adequate to bring in the
parties and to start the case on a course of judicial
handling which . . . [could have] lead to final judgment
without issuance of new initial process. . . .’”
Burnett[ v. N.Y. Cent. R.R. Co., 380 U.S. 424, 426
(1965)] (citation omitted). In such circumstances,
. . . we perceive no reason for barring plaintiffs from
pursuing their action in New Jersey.
Id. (brackets in original).
Mitzner, and cases like it, are thus factually distinct from
this action.
When the plaintiffs originally brought this action in
state court, it was not brought against Ranbaxy.
Accordingly,
nothing about the original pleading was “adequate to bring in”
Ranbaxy, which was not a party to the action.
51
The plaintiffs did
not commence the action in a manner that could have led to final
judgment without issuance of new initial process until March 19,
2009, when process was served on Ranbaxy.
(See dkt. entry no. 28,
Summons Returned Executed.)
That was more than one year after the
commencement of the action.
For that reason, the statute of
limitations was not tolled.
6.
The Claim for Fraud in the Inducement
The plaintiffs stated the claim for fraud in the inducement as
follows:
Plaintiff was induced to accept the contract and
position for its personnel and subsequent assignment to
India based on the promises of Ranbaxy, it agents,
servants and/or employees, including but not limited to
the promises of payment for work performed, timely
payment for work performed, a permanent position and/or
the opportunity for a permanent position with Ranbaxy
and representations made to plaintiff, that if
plaintiff’s personnel would be assigned to India, they
would be treated like Ranbaxy employees. Relying on the
promises made by Ranbaxy, plaintiff accepted contract
and the assignment to her detriment.
(See 2d Am. Compl. at Tenth Count, ¶ 22.)
The plaintiffs thus
appear to allege that Ranbaxy, to induce the plaintiffs to execute
the Software Services Agreement and related purchase orders,
promised to: (1) provide timely compensation for Naples’s services;
and (2) give Naples either (a) a “permanent position” at Ranbaxy,
or (b) the opportunity to secure full-time employment at Ranbaxy.
(See id.)
They also appear to allege that Ranbaxy induced the
52
plaintiffs to accept the assignment at Ranbaxy Labs in Gurgaon by
promising to treat Naples as similarly situated Ranbaxy employees
were treated.
(Id.)
Ranbaxy has moved for summary judgment in its favor and
against the plaintiffs on all aspects of this claim.
(See Br. in
Supp. at 49-50 (similarly detailing the bases for the claim, as set
forth in the Second Amended Complaint).)
However, the plaintiffs
have abandoned the first and third aspects of this claim, as they
have failed to offer any argument or evidence on it in opposition
to the Ranbaxy Motion.
See Curtis v. Treloar, No. 96-1239, 1998 WL
1110448, at *9 (D.N.J. Aug. 27, 1998), aff’d, 189 F.3d 463 (3d Cir.
1999); see also Desayatnik v. Atl. Casting & Eng’g Corp., No.
03-5441, 2006 WL 120163, at *1-2 (D.N.J. Jan. 17, 2006).
The Court
will thus analyze only the second and fourth aspects of the claim
for fraud in the inducement.
a.
The Alleged Promise to Give Naples a
“Permanent” Position at Ranbaxy
Ranbaxy and the plaintiffs agree, with respect to Ranbaxy’s
alleged promise to give Naples a “permanent” position at Ranbaxy,
that this aspect of the fraud in the inducement claim should be
governed by New Jersey law.
Br. at 54-56.)
claim.
(See Br. in Supp. at 52, 54-57; Opp’n
The Court will thus apply New Jersey law to this
See Fed. Ins. Co., 639 F.3d at 566-67; Krumme, 238 F.3d at
138.
53
Under New Jersey law, a claim for fraud in the inducement
seeking legal relief sounds in common-law fraud.
See Microbilt
Corp. v. L2C, Inc., No. A–3141–09T3, 2011 WL 3667645, at *3
(N.J. App. Div. Aug. 23, 2011). 18
The elements of common-law
fraud are: “(1) a material misrepresentation” of fact; “(2)
knowledge or belief by the defendant of its falsity; (3) an
intention that the other person rely on it; (4) reasonable
reliance thereon by the other person; and (5) resulting
damages.”
Gennari v. Weichert Co. Realtors, 148 N.J. 582, 610
(1997); see also Lightning Lube, Inc. v. Witco Corp., 4 F.3d
1153, 1182 (3d Cir. 1993) (demonstrating that plaintiffs seeking
monetary damages must prove scienter); Luscko v. S. Container
Corp., No. 06-3896, 2009 WL 5171868, at *4 (D.N.J. Dec. 23,
2009) (reciting elements of claim for fraud in the inducement
under New Jersey law), aff’d, 408 Fed.Appx. 631 (3d Cir. 2010).
“A misrepresentation amounting to actual legal fraud” will
generally consist “of a material representation of a presently
existing or past fact”.
86 N.J. 619, 625 (1981).
Jewish Ctr. of Sussex Cnty. v. Whale,
Such a misrepresentation may also
concern future events, if the plaintiff can demonstrate that
18
New Jersey courts also recognize fraud in the inducement as
an equitable remedy that may serve as the basis for rescission of a
contract. See, e.g., Merchs. Indem. Corp. v. Eggleston, 37 N.J.
114, 130-31 (1962). Here, however, the plaintiffs seek only legal
relief, i.e., monetary damages.
54
those representations were made with the intent to deceive.
See
Luscko, 408 Fed.Appx. at 634; Notch View Assocs. v. Smith, 260
N.J. Super. 190, 202-03 (Law Div. 1992).
A plaintiff may show
the existence of such intent through circumstantial evidence,
such as the “utter recklessness and implausibility of the
statement in light of subsequent acts and events, a showing that
the promisor’s intention to perform was dependent upon
contingencies only known to him, or evidence showing at the time
of the promise that the promisor could not or would not fulfill
the promise.”
Luscko, 408 Fed.Appx. at 634-35.
But “[m]ere
nonperformance of a promise is insufficient to show that a
promisor had the requisite intent not to perform.”
Id. (citing
Notch View Assocs., 260 N.J. Super. at 203); see also Alexander
v. CIGNA Corp., 991 F.Supp. 427, 436 (D.N.J.) (“[P]redictions of
the future, which were believed when made, cannot serve as a
basis for a fraud claim just because they subsequently turn out
not to be true.”), aff’d, 172 F.3d 859 (3d Cir. 1998).
The Court has carefully considered the record, the law
relating to this aspect of the claim for fraud in the inducement,
and the standard of review applied to motions for summary judgment.
The Court now concludes that: (1) the plaintiffs have failed to
meet their burden of coming forward with evidence demonstrating, as
a matter of disputed, material fact, that Ranbaxy made material
55
misstatements regarding its intent to convert Naples from an
independent contractor to a full-time Ranbaxy employee; and (2) if
the plaintiffs had come forward with evidence of such material
misstatements, then the Court would nonetheless conclude that the
plaintiffs could not have reasonably relied on those misstatements.
Here, the record shows that Rebba and Walia, when interviewing
Naples for a position as an independent contractor, represented
that Ranbaxy was interested in hiring an independent contractor who
desired full-time employment at Ranbaxy.
They also represented
that Ranbaxy intended to convert that independent contractor to a
full-time Ranbaxy employee in approximately six months.
(See Tr.
of 10-27-08 Naples Dep. at 56-57, 59, 64-65; Tr. of 3-8-11 Naples
Dep. at 28, 30, 32, 34; Naples Aff. at ¶ 6; Walia Decl. at ¶ 5;
Rebba Decl. at ¶ 6.)
Rebba thereafter communicated with Naples
about the ongoing likelihood that Ranbaxy might later establish the
full-time position and offer that position to Naples.
(See Naples
Aff. at ¶¶ 17-19; Rebba Decl. at ¶ 11; Tr. of 3-8-11 Naples Dep.
at 127-28, 133.)
In addition, at least one person told Naples
that she would not be considered for the full-time position unless
she extended her stay in India and completed the assignment at
Ranbaxy Labs.
(See Naples Aff. at ¶ 64.)
Whether considered alone or in the aggregate, these statements
-- which merely concerned the possibility that Ranbaxy would offer
56
Naples full-time employment -- are not actionable, and this aspect
of the claim for fraud in the inducement is not viable.
As the
non-moving party, the plaintiffs had the burden of coming forward
with evidence that tends to show that each of these statements
constituted a material misstatement.
See Fed.R.Civ.P. 56(c)(1)(A)
(requiring non-moving party to produce at least some evidence to
support each material fact); Matsushita Elec. Indus., 475 U.S. at
586 (requiring the non-moving party to “do more than simply show
that there is some metaphysical doubt as to the material facts.”).
They have failed to carry that burden.
Because each of the statements at issue concerns the chance
that Ranbaxy would take future action by offering Naples full-time
employment, the plaintiffs had the burden of proving that Ranbaxy
made those statements with the intent to deceive the plaintiffs.
See Luscko, 408 Fed.Appx. at 634-35; Notch View Assocs., 260
N.J. Super. at 202-03.
They have failed to carry this burden.
In their opposition brief, the plaintiffs state without citation
or meaningful explanation that Ranbaxy intended to deceive the
plaintiffs, to induce them to execute the Software Service
Agreement and subsequent Purchase Orders.
55-56.)
(See Opp’n Br. at
To the extent that the plaintiffs imply that intent may
be inferred from Ranbaxy’s failure to create or offer Naples a
full-time position at Ranbaxy, that implication conflicts with
57
New Jersey law.
See Luscko, 408 Fed.Appx. at 634-35; Alexander,
991 F.Supp. at 436; Notch View Assocs., 260 N.J. Super. at 203.
And to the extent that the plaintiffs speculate that Ranbaxy
acted with the intent to deceive them, the Court notes that such
“speculation or conjecture does not create a material factual
dispute sufficient to defeat” the Ranbaxy Motion.
914 F.2d 382 n.12.
Robertson,
Accordingly, the Court will enter judgment
in Ranbaxy’s favor and against the plaintiffs on this aspect of
the claim for fraud in the inducement.
b.
The Alleged Promises Concerning Naples’s
Assignment in India, and the Related Living
and Working Conditions
The Court earlier noted that the plaintiffs abandoned certain
aspects of the claim for fraud in the inducement by failing to
provide related argument in opposition to the Ranbaxy Motion.
It
similarly appears that the plaintiffs have abandoned this aspect of
the claim.
The plaintiffs’ sole reference to this aspect of the claim
appears in the following passage from their opposition brief:
Additionally, representations were made about Naples’
[sic] work and living conditions in India, which Ranbaxy
knew to be false representations because Mazumdar [(a
Ranbaxy Labs employee, who worked alongside Naples in
Gurgaon)] told Naples that she was just treating the
plaintiff how she was told in order to ensure that
Naples would get the work done. These representations,
being false, were fraudulently made solely to induce
58
reliance upon them so that Naples would agree to go to
India.
(Opp’n Br. at 55-56 (citations to record omitted).)
The plaintiffs
have failed to detail: (1) what representations, if any, Ranbaxy
made about the living and working conditions in India; (2) how
those representations, if false, were false; and (3) that the
plaintiffs reasonably relied on those representations.
But see
Gennari, 148 N.J. at 610 (providing elements of a claim for
common law fraud).
The Court will enter judgment on this aspect of the claim
for fraud in the inducement.
The decision to enter such
judgment rests on three alternative conclusions.
First, the
Court deems the plaintiffs to have abandoned this aspect of the
claim for fraud in the inducement.
The plaintiffs have not set
forth a sufficient argument, such that the Court can meaningfully
rule on the merits of that aspect of the claim.
See Curtis, 1998
WL 1110448, at *9.
Second, if the Court considered the merits of this aspect
of the claim for fraud in the inducement, then the Court would
conclude that the plaintiffs have “fail[ed] to make a showing
sufficient to establish the existence of an element essential to
[their] case, and on which [they] will bear the burden of proof at
trial”.
Celotex, 477 U.S. at 323.
Under these circumstances, the
Court would enter summary judgment in the movant’s, i.e., Ranbaxy’s
59
favor.
See id.; see also Fed.R.Civ.P. 56(e)(3); Kovalev, 362
Fed.Appx. at 331 (demonstrating that the non-moving party’s
speculation and conjecture cannot defeat a motion for summary
judgment).
Third, it appears that this aspect of the claim for fraud
in the inducement is, in accordance with New Jersey’s choice of
law rules, governed by the law of India.
See Kennedy, 2007 WL
135951, at *4 (citing RESTATEMENT (SECOND) CONFLICT
OF
LAWS § 148 cmt. j)
(recognizing that the law of the forum where a plaintiff acts in
reliance on a defendant’s representations will usually apply); see
also RESTATEMENT (SECOND) CONFLICT
OF
LAWS § 148(2).
Because this aspect
of the claim is governed by the law of India, India’s statute of
limitations applies.
See Cornett, 211 N.J. at 373-74.
That
statute provides only a three-year limitations period, and would
thus render this aspect of the claims for fraud in the inducement
time-barred.
No. 113.
See Limitation Act, at Schedule, First Div., Pt. X,
(See Am. Compl. (filed on February 4, 2009, more than
three years after Naples returned from India).)
7.
The Claim for Negligent Misrepresentation
The plaintiffs’ claim for negligent misrepresentation does not
inform the Court of the bases upon which the plaintiffs seek
relief.
In the Second Amended Complaint, the plaintiffs state:
Plaintiff alleges and incorporates by reference as
though fully set forth herein [all of the allegations
60
against Ranbaxy]. . . . Ranbaxy’s actions consist of
negligent misrepresentation. Ranbaxy made untrue
statements to the plaintiff [sic]. The plaintiff [sic]
relied on said untrue statements and the plaintiff [sic]
was damaged.
(2d Am. Compl. at Thirteenth Count, ¶ 1 and ¶ 29.)
Ranbaxy has interpreted this claim as resting on the same
facts and allegations as the claim for fraud in the inducement.
That interpretation rests on Naples’s deposition testimony.
(See
Br. in Supp. at 57 (“Naples testified that her misrepresentation
claim arise[s] from essentially the same facts as the fraud claims
. . . .”).)
The plaintiffs appear to agree with Ranbaxy’s
interpretation; they state that
. . . Ranbaxy made incorrect statements: that Naples
would be made a permanent employee; that Naples was to
go to India to gain experience on what she would be
doing as a permanent employee; that Naples would be
treated well while in India; that the permanent position
had been created and approved.
(Opp’n Br. at 57.)
It appears, then, that there are two aspects to
the claim for negligent misrepresentation, i.e., aspects relating
to representations: (1) that Naples would be given a full-time
position as a Ranbaxy employee; and (2) that Naples would receive
certain living and working conditions while in India.
a.
The Alleged Promise to Give Naples a
“Permanent Position” at Ranbaxy
Ranbaxy and the plaintiffs appear to agree that this aspect of
the claim for negligent misrepresentation should be governed by New
61
Jersey law.
(See Br. in Supp. at 52, 54-57; Opp’n Br. at 54-56.)
The Court will thus apply New Jersey law to this aspect of the
claim for negligent misrepresentation.
See Fed. Ins. Co., 639 F.3d
at 566-67; Krumme, 238 F.3d at 138.
Negligent misrepresentation claims are quite similar to
common-law fraud claims.
Dayrit v. Mem’l Hosp. of Salem, No.
A–0232–10T4, 2012 WL 1987096, at *7 (N.J. App. Div. June 5, 2012).
Under New Jersey law, a plaintiff raising a claim for negligent
misrepresentation must demonstrate that: (1) the defendant
negligently made an incorrect statement; (2) the plaintiff
justifiably relied on that statement; and (3) the plaintiff, as a
consequence of that reliance, suffered damages.
Kaufman v. i-Stat
Corp., 165 N.J. 94, 109 (2000); see also Indian Brand Farms, Inc.
v. Novartis Crop Prot. Inc., 617 F.3d 207, 218 (3d Cir. 2010).
The Court has considered the arguments raised on this aspect
of the claim for negligent misrepresentation, and concludes that
it, like the parallel aspect of the claim for fraud in the
inducement, cannot survive the Ranbaxy Motion.
The plaintiffs have
failed to produce evidence showing that Ranbaxy’s statements about
its intent to take future action -- i.e., its intent to perhaps
convert Naples from an independent contractor to a full-time
Ranbaxy employee -- were false.
As noted above, neither Ranbaxy’s
decision not to convert Naples to a full-time employee nor the
62
plaintiffs’ speculation and conjecture concerning Ranbaxy’s motives
are sufficient to defeat the Ranbaxy Motion.
F.2d 382 n.12.
See Robertson, 914
The Court will thus enter judgment in Ranbaxy’s
favor and against the plaintiffs on this aspect of the claim for
negligent misrepresentation.
b.
The Alleged Promises Concerning Naples’s
Assignment in India, and the Related Living
and Working Conditions
Here, as with the claim for fraud in the inducement, the
plaintiffs’ argument is sparse.
They state:
Defendants cannot claim that they were not aware of the
representations made to the plaintiff regarding her
treatment in India. Representations were made about
Naples’ [sic] work and living conditions in India, which
Ranbaxy knew to be false representations because
Mazumdar told Naples that she was just treating the
plaintiff how she was told in order to ensure that
Naples would get the work done.
(Opp’n Br. at 57-58 (citations to record omitted).)
The plaintiffs
have thus failed to detail: (1) what statements Ranbaxy made; and
(2) how those statements, if false, were false.
But see Kaufman,
165 N.J. at 109 (providing elements of a claim for negligent
misrepresentation).
The Court will thus enter judgment on this aspect of the
claim for negligent misrepresentation.
The decision to enter
such judgment rests on the same three conclusions provided
above, with respect to that aspect of the claim for fraud in the
63
inducement that concerns the assignment in India.
First, the
Court deems the plaintiffs to have abandoned this aspect of the
claim for negligent misrepresentation.
1110448, at *9.
See Curtis, 1998 WL
Second, the Court concludes that the plaintiffs
have “fail[ed] to make a showing sufficient to establish the
existence of an element essential to [their] case, and on which
[they] will bear the burden of proof at trial”.
at 323.
Celotex, 477 U.S.
Under these circumstances, the Court may enter summary
judgment in the movant’s, i.e., Ranbaxy’s favor.
See id.; see also
Fed.R.Civ.P. 56(e)(3); Kovalev, 362 Fed.Appx. at 331.
And third,
it appears that this aspect of the claim for negligent
misrepresentation is, in accordance with New Jersey’s choice of
law rules, governed by the law of India, which would render it
time-barred.
See Limitation Act, at Schedule, First Div., Pt. X,
No. 113; Cornett, 211 N.J. at 373-74; Kennedy, 2007 WL 135951, at
*4; see also RESTATEMENT (SECOND) CONFLICT
64
OF
LAWS §§ 148(2), 148 cmt. j.
III. CONCLUSION
The Court, for the reasons set forth in this Memorandum
Opinion, will grant the Ranbaxy Motion, and enter judgment in
Ranbaxy’s favor and against the plaintiffs on all of the claims
raised against Ranbaxy.
The Court will enter a separate Order and
Judgment.
s/ Mary L. Cooper
.
MARY L. COOPER
United States District Judge
Date:
May 20, 2013
65
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