Gym Door Repairs, Inc. et al v. New York City Department of Education et al

Filing 35

OPINION: Upon the conclusions set forth above, Plaintiffs' request for injunctive relief is denied, and Defendants' motion (23) to dismiss the Complaint is granted with leave given to replead within twenty days. (Signed by Judge Robert W. Sweet on 9/5/2013) (cd)

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UNITED STATES DISTRI COURT SOUTHERN DISTRICT OF NEW YORK ------x GYM DOOR REPAIRS, SYSTEMS LLC, INC. and SAFE PATH PIa 12 Civ. 7387 iff, OPINION -againstNEW YORK CITY DEPARTMENT OF EDUCATION, DENNIS M. WALCOTT, as ancel r of the New York City Department of Education, NEW YORK CITY SCHOOL CONSTRUCTION AUTHORITY, THE BOARD OF TRUSTEES OF THE NEW YORK CITY SCHOOL CONSTRUCTION AUTHORITY, THE CITY OF NEW YORK, JOHN T. SHEA, as chief Execut Officer of New York City Department of Education sion of School Facilities, VOLKERT BRAREN, as Director of Program Management of NYCDOE, CHRIS COYLE, as Construction Project Manager of New York City Department of Education, CHRIS D'ALIMONTE, as Borough Contract Manager of New York City rtment of Education, THOMAS FANIZZI, as Manhattan Maintenance Planner of New York City Department of Education and sion of School Facilities and JOHN DOE NUMBERS 1 through 5, whose names are not presently unknown, as agents, servants and employees of THE CITY OF NEW YORK, Defendants. ---x A P PEA RAN C E S: Att for Plaintiffs TARTER KRINSKY & DROGIN LLP 1350 Broadway, 11th Floor New York, NY 10018 -~""""'::::'''===: . tlSDC SDNY - - - - : ­ ., :)OCUMENT 'LECTRONICALLV ['If J'~', ·)OC #: _DATE FI:-:LED---'; 3-"--1-Q:13 .;.. .,-;;: 4> ;=A By: Eric ,Esq. Lisa M. McIntyre, Esq. Eva M. Young, Esq. Attorne for Defendants MICHAEL A. CARDOZO Corporation Counsel of the ty of New York 100 Church Street, Room 5-180 New York, NY 10007 Scott Glotzer, Esq. 2 De ndants the C of New York ( "City"), New York City Department of Education ("NYCDOC"), Dennis M. Walcott, New York Y School Construction Aut ty ("NYCSCA"), Board of Trustees of the New York City School Construction Author John T. , Volkert Braren, Chris Coyle, Chris D' y, imonte and Thomas Fanizzi, and John Doe Numbers 1 through 5 (the "Individual Defendants", and collectively "Defendants"), have moved to dismiss the compla Inc. of aintiffs Gym Door Repairs, ("GDRI") and Safepath Systems LLC ("SSL" and collectively, the "PIa iffs") pursuant to Fed. R. Civ. P. 12 (b) (6) 12(b) (6)"). Upon the conclusions set forth below, t ("Rule motion is granted. Prior Proceedings The Plaintiffs filed a complaint ( "Complaint") on October 2, 2012 in which they asserted claims under 42 U.S.C. § 1983 ("§1983") aris from, inter alia, the all of a protectable property interest without process. rivation On December 31, 2012, the Defendants moved to dismiss the Complaint. The motion was heard and marked fully submitted on March 13, 2013. 3 The Facts In 2001, the New York State 1 Education Law § 409-f (t islature enacted "Statute") in response to the dea of two students resulting from accidents involving electrically operated partitions used in school gyms. Compl. ~ 15. The Statute mandated that Every electrically operated partition or room divider 11 be equipped with safety devices which, subject to standards establis d in rules and regulations promulgated by the commissioner, stop the forward motion of the partition or room divider . . . when a body passes between t leading panel of such divi r and a wall, or when a body is t stac ng area of such partition or divider. N.Y. Educ. L. § 409-f. In furtherance of Statute, the New York State Education Department promulgated and implemented Commissioner's Regulation alia, § 155.25 (the "Regulation"), which required, inter that the safety equipment installed pursuant to the Statue "shall not be tampered with, overridden or by-passed" and "must be maintained in accordance with the manufacturer's 4 instructions, including the manufacturer's recommended service interval . Compl. " <j( 17. Plaintiffs are manufacturers, installers and service contractors of safety system cal Safepath System ("SPS" or the "System"), which is designed to prevent accidents involving electrically operated partition doors. 2007, sa In or around fendant NYCSCA, which is responsible for ensuring the y of New York ty's school ilities, issued the New York Y School Construction Authority Manual (the "Speci cations"), which set forth det regarding the elect Is and tructions sign, construction and maintenance of cally operated partitions in t City's schools. Section 4(a) of the Specifications mandated that "[tJhe infra-red sa detection system shall be "S -Path" as manufactu ty by [GDRIJ " According to Plaintiffs, the combined ef Statute, Regulation and the Speci of the cations is to require the City's schools to utilize Plaintiffs' Safepath System on all elect cal operated partition doors subject to the Statute, and to utilize Plaintiffs' services to install, service, repair and maintain S tern, and to train and certify maintenance 5 rform those duties. technicians and/or contractors to ~ 39. Plaintiffs believe that these Compl. irements have the effect of conveying a property interest to Plaintiffs rail revenue and business opportunities generated from the labor, ma als and/or parameters of ces required in order to comply wi Statute, Regulation and cifications. the Id. Although there are more than 1,000 electrically operated partitions that require a sa y system pursuant to the Statute, Plaintiffs have not installed their Safepath System on more than half of those locations. Id. ~~ 41-44. Moreover, the Safepath Systems that have been installed have not been regularly inspected, services, repaired and/or maintained exclusively by Plaintiffs. Id. ~~ 45 46. Beginning in 2004, Plaintiffs repeatedly advised Defendants concerning their alleged property interest vested by the Statute, Regulation and Specifications, and demanded that Defendants adhere to the requirements of these mandates by exclus 48-57. ly utilizing Plaintiffs' products and services. Defendants reject these demands. 6 Id. ~ 61. Id. ~~ After unsuccess lly seeking redress from the New York New York State City Department of Investigations and Attorney General's Office, in March 2011 Plaintiffs cowmenced a lawsuit in New York Supreme Court pursuant to N.Y. C.P.L.R. § 78 (the "Article 78 Action") which they sought to compel Defendants to recognize their alleged property interest and s' compliance with the Statute and the orce the De Regulation. Id. ~~ 63 65. The New York Supreme Court (the "State Court") ultimately ruled that Plaintif to bring the Article 78 Action. Id. According to Plaintiffs, De filing ~ lacked standing 65. ndants retaliated for the the Article 78 Action by directing contractors engaged by NYC DOE and NYCSCA to perform school construction and improvement work to "never use" Plaintiffs' Safepath System or services on any school-related construction projects. . ~ 66. In or about April 2012, references to Plaintiffs and the Safepath System were removed from the Specifications. 67. modif According to Plaintiffs, Defendants effected this ion of the Specifications in retaliation for Plaintiffs' efforts to enforce compliance with the Statute, Regulation and Specifications. Id. 7 Id. ~ Plaintiffs thereafter initiated the in which they have assert (i) cIa stant lawsuit, under §1983 for viol ion r procedural and substantive due process rights as a result of being deprived of t ir alleged property interest, (ii) a First Amendment retaliation claim and (iii) a request for injunctive relief requiring Defendants to exclus Plaintif ly use ' products and services in the course of complying with the Statute. The Applicable Standard On a motion to dismiss pursuant to Rule 12(b) (6), all factual allegations the complaint are accept 1 inferences are drawn in favor of Molecular Co 12 F.3d 1170, 1174 as true, and pleader. Mills v. Polar (2d Cir. 1993). The issue "is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer dence to support t claims." (2d Cir. 1995) 56 F.3d 375, 378 Scheuer v. Rhodes, (1974)). 8 416 U.S. 232, 235-36 To survive a motion to dismiss pursuant to Rule 12(b) (6), "a complaint must contain sufficient factual matter, ief t accepted as true, to 'state a claim to on its face.'N Ashcroft v. I 570 (2007)). e 556 U.S. 662, 129 S.Ct. 1937, Bell Atl. Co 1949 (2009) aus 1S v. Twombl 550 U.S. 544, Plaintiffs must allege sufficient facts to "nudge [ 1 their claims across the line from conceivable to plausible. N 550 U.S. at 570. Twombl ctual all the ions of a complaint as true, it is "not bound to accept as true a Ie all Though the court must a ion. N -----"'-­ I 1 conclusion couched as a factual 556 U.S. at 678 (quoting Twombl 550 U.S. at 555). The Complaint Fails To State A Claim Under 42 U.S.C. Section 1983 "does not itself provi rights, but in a method for ct of rights elsewhere confer 1983 substant ndicating v. Count " § ral of Nassau, 2009 U.S. Dist. Lexis 27105, at *58 (E.D.N.Y. Mar. 30, 2009) (internal quotation marks omitted); Patterson v. Count Oneida, 375 F.3d 206, 225 (2d r. 2004); Cit of of Oklahoma v. Tuttle, 471 U.S, 808, 816 (1985); Baker v. McCollan, 443 U.S. 137, 144 n.3(l979); kes v.James 9 13 F. 515, 519 (2d Cir. 1993) ; ~~~ __ ~~~L- of New York, 2009 U.S. Dist. Lexis 30241, _ _ _ _ _ _ _ _ _ ____ r i l l , 2009). at *10 (S.D.N.Y. In general, "Section 1983 provides a cause of action for the 'depr privileges, or immunities s by any rson act by Constitution and laws' 'under color of any statute, regulation, custom, or us It is well sett nance, 0 , of any State or Territory.'" Gomez v. Toledo, 446 U.S. 635, § tion of any rights, 638 (1980). that "to state a claim under 1983, a plaintiff must allege (1) that the challenged conduct to a person acting under color was attributable at least in of state law, and (2) that such conduct deprived the aintiff of a right, privilege, or immunity secured by the Constitution or laws of the United States." Roffman v. Cit of New York st. Lexis 23665, at *10 (S.D.N.Y. Dec. 10, 2002); 2002 U.S. see also Gomez, 446 U.s. at 640. Here, Plaintiffs have alleged that Defendants' conduct, in l ng Plaintiffs of their alleged operty interest in the revenue and business opportunities resulting from P intiffs' purported right to the be exc s supplier and servicer of safety devices for electrically operated rtitions in New York City schools, had the effect of 10 depriving Plaintiffs of their constitutional rights to procedural and substantive due process. As set rth below, both of these claims fail because Plaintiffs have not established t there existence of the property interest, and have not alleged a deprivation sufficient to support a §1983 claim. olation The constitutional right to procedural requires that a deprivation of ife, 1 Plainti , process rty, or property preceded by notice and an opportunity to be heard. Mullane v. Central Hanover Bank & Trust, 339 U.S. 306,313 (1950). Whether an individual's procedural due process rights ied rests on whet have r that rson has been deprived of a liberty or property interest subject to due process protection. (1972). _B_o~a~r~d~o~f~~~___s __ ~R_~t~h, __v . _ o 408 U.S. 564, 569-72 The Supreme Court has explained that a property interest in a benefit requires "more than an abstract ne or sire for it" and more than a "unilateral expectation" of receiving the benefit. Id. at 577. In order to serve as the basis for a procedural due process claim, an ind 11 dua' must have a "legitimate claim of entitlement" to the benefit at issue. rd. universe of property rights subject to due process protections "are created and their dimensions are fined by sting rules or understandings that stem from an independent source such as state law." 60, 62 (2d Cir. 1992). ion type of Accordingly, a s will subs a benef St v. Green, ect 978 F.2d hope or ntly issue is not the rest that triggers due process protection. Roth, 408 U.S. at 577. In r to make out a cause of action for denial of 0 process, a plaintiff must "first procedural ntify a property right, second show that the State has deprived h that right, and third show t without due process." __ ~~L- __ ~ ____ ~ ____ ~ of t the deprivation was effected Local 342 ----------~-----~---------------------- ________________________________ 1191 1194 (2d Cir. 1994), ~~ __ , 31 F.3d Mehta v. Surles, 905 F.2d r curiam)). 595, 598 (2d Cir. 1990) "The burden is on the one complaining of a due process violation to establish that the legislature has acted an arbitrary and irrational way," i.e., without due process of law. of New York, F.2d 1199 ( All Aire Condition 979 F. Supp. 1010, 1018 (S.D.N.Y. 1997), aff'd, 166 Cir. 1998). 12 Under the New York State public bidding laws: low bidder nor any ot "[nJeither r bidder has a vest a public contract property interest (1985) Conduit & rt Authori v. Met 144, 148-49, " , 66 N.Y.2d (citations omitted); see also John Gil Construction, Inc. v. Riverso, 72 F. Supp.2d 242, 252 (S.D.N.Y. 1999); Schiavone Construction Co. v. La Rocca, 117 A.D.2d 440, 443 (3d Dep't 1986); Callanan Indust. v. Count 116 A.D.2d 883, 884 v. (3d Dep't 1986); Eastwa of Schene Construction Co rk, 762 F.2d 243, 250 (2d Cir. 1985) (involvement in publicly financed project does not rise to level of property interest). Moreover, the Complaint has not alleged any contractual rights as against Defendants. Plaintiffs perform ialty work under sub-contracts wi Contractors ("JOC"). Plaintiffs lack Compl. <J1<J1 53, 66. t Job Order As subcontractors, of contract with Defendants, and are thus precluded from bringing suit against Defendants. - - - " ' - ' ­ Ba Bette & (3d Duke, Inc. v. State of New York, 240 A.D.2d 54, 56 ' t 1998); Travelers Cas. & Sur. Co. v. Dormitor 735 F. Supp.2d 42, 69 (S.D.N.Y. 2010). 13 ., In addition, absent an intent to benefit a prime contract, a subcontractor that is expressly stated in t subcontractor is not a third-party beneficiary. Electrical Construction . v. Atlas (1976); Faist v. Garsl (2nd Port Chester 40 N.Y.2d 652, Construction 656 220 A.D.2d 718, 719 't 1995); Artwear, Inc. v. Hughes, 202 A.D.2d 76, 84 (1st Dep't 1994); Point Condominium III 182 A.D.2d 664,665 (2d Dep't 1992); 156 A . D. 2 d 550, 551 ( 2 d Dep 1 t 1989); _A_r_r_o_w_L_o_u_v_e_r_& _--*-_r_v_._N_e_w_ _ York Cit 106 A.D.2d 533, 534 Transit Auth. (2d Dep't 1984). Further, the incorporation into a subcontract of construction specifications and other requirements of a pr contract does not vest any rights in a subcontractor against an owner. Port Chester Electric Construction Co. v. Atlas, supra, 40 N.Y.2d at Inc. v. Binks Manu 656; S. Leo Harmona Co., 597 F. ., 1985 Supp. 1014, 1024-1026 (S.D.N.Y. 1984) aff'd without U.S. App. s 26713 1746, etc. v. Unit (2d Cir. March 5, 1985); _Aircraft, 534 F.2d 422, 441 s 743 and (2d Cir. 1975). Here, Article 58A of DOE's general contract specifically disclaims any relationship between itself and any subcontractor, providing that nothing in either the general 14 into by the general contract or any sub-contract ente between the contractor will create any contractual relationsh Declaration of Scott Gl subcontractor and DOE. ss ("Glotzer Decl.") Support of City Defendants' Motion to Di ~ zer in 10 & Exhibit E. has also failed to establish The Compla PIa iffs have a ght to be awarded a public contract or to subcontract on a public contract. In cases of contracting, government officials have a "significant continued conferral of [a] benefit, that rec scretion" over "the [and thus] it will rare ent will be able to establish an entitlement to that benefit." Kell Kare Ltd. v. O'Rour 930 F.2d 170, 175 (2d Cir. 1991); see also Town of Cast Rock v. Gonzales, 545 U.S. 748, 756 (2005); RR Vii Inc. v. Denver Sewer Corp., 826 F.2d 1197, 1202 (2d Cir. 1987). Moreover, Under New York law, DOE may only award contracts to the lowest responsible dder. GML § 103, Educ. Law §§ 2556(10), 2556(10-a). In the face of se well-established norms and laws regarding the awarding of government contracts, the mere fact that aintiffs maintenance laterally inserted language in their own structions that expressly precl 15 anyone ot r than Plaintiffs from performing the maintenance, see Compl. 38, cannot have a sole source relat ef of requir sh ~ Defendants to enter into with Plaintiffs. Accordingly, the language in the Regulation requiring that "[a]ll equipment must be maintained in accordance with the manufacturer's instructions H must be understood as mandating con rmity w the methods and procedures prescribed by the manufacturer, rather than commanding that the manufacturer be ves power to determine vendor selection. with See ----~----~--~~--~~ Dai Co­ v. Brannan, 173 F.2d 57, 66 (2d Cir. 1949) (holding that "when alternative interpretations [of an administrative regulation] are poss be chosen. e, the more reasonable of the two is to . fI) • Lastly, even assuming, arguendo, t Plaintiffs have somehow alleged a protectable property right, they have still led to allege a deprivation of such right without procedural due process, given that Plaintiffs had the opportunity to pursue Arti e 78 review. See Beechwood Restorative Care Center, et al. v. Leeds, et al., 436 F.3d 147, 156 (2d Cir. 2006) t "[a]n Article 78 proceeding. afford[s] a meaning post-deprivation remedyH that obviates a violation) i C.A.U.T.I.O.N. Ltd. v. Cit 16 (holding 1 aim for due process of New 898 F. lmer, 468 U.S. Supp. 1065, 1074-75 (S.D.N.Y. 1995); Hudson v. 517, 533 (1984). B. Ri The Compla t Fails To Allege A Violation of Plaintiffs' t to Substantive Due Process "To establish a olation of a right to substantive due process, a plaintiff must demonstrate not only government action but also that the government action was 'so egregious, so outrageous, that it may fairly be said to shock the contemporary conscience.'" c Pena v. DePrisco, 432 F.3d 98, 112 (2d Cir. 2005), ing f Sacramento v. Lewis, 523 U.S. 833, 847 The Court of Appeals stated that "in vi Second Circuit s t (1995)). y r to shock the conscience and trigger a ation of sUbstantive due process, official conduct must be outrageous and regious under circumstances; it must be truly 'brutal and offensive to human dignity .... '" Lombardi v. Whitman, 485 F.3d 73, 81-82 (2d Cir. 2007), quoting Smith v. Half Hollow Hills Cent. Sch. Dist., 298 F.3d 168, 173 (2d Cir. 2002); Johnson v. Glick, 481 F.2d 1028, 1033 (2d Cir. 1973); __ ~~ __ ~~d-~~~ of _ _ _ _ _ _ _ __ _ 2006 U.S. Dist. Lexis New York, _ _ _ _ _ _ _ _'_ _ ~ 62220 at *30 (S.D.N.Y. Aug. 30, 2006); aff'd, 293 (2d Cir. 2008). (Government action must be "arbitrary, 17 Appx. 13 conscience-shoc a constitutional sense,H ng, or oppressive ct or ill-advised"). not merely " Moreover, the governmental action must be the product of an improper motive unrelated to a legitimate governmental purpose, "Only a substantial fringement of state law prompted by personal or group animus, or a deliberate flout of the law that trammels significant personal, or property rights, qualifiers] for relief' under the doctrine of substant process. Natale v. Town of 1999) field, 170 F.3d 258,263 (2d Cir. (citation omitted); Heath v. Henning, 854 F.2d 6, Cir. 1988) due 9 (2d (contrasting Fourth Amendment standard of obj ect reasonableness wi substantive due process standard requiring improper motive) . In addition, contractual rights, by themselves, will not support a substantive due ss claim since "simple state- law contractual rights, without more, are [not] worthy of substantive due process protection." Local 342. 1. I. Public Co. s, 31 F.3d at 1196; ----------- ~----------~----Russell P Service ----------~--~--- v. Ci of New York .. 1997 U.S. Lexis 1970 at *30 (S.D.N.Y. Feb. 21, 1997). 18 In the instant case, the Complaint does not identify was revoked, denied, or on any contract or sub-contract t whi P intiffs received a declaration of de It, a finding of non responsibility, or a negative evaluation, or any ot of conduct that could possibly conscience." r type construed as "shocking the Rather, the Complaint has merely alleged Plaintiffs were depr of a right to be sole source suppliers and servicers of electrically operated partition doors and to be listed in perpetuity as such in the SCA's specifications, Compl. <JI<JI 53, 61, 66, 67 ,74,80, 81, which is a did not in fact possess. See § A. ght that Plaintiffs Accordingly, Plaintiffs have not alleged a substantive due process violation. The Complaint Has Not Stated A Claim For First Amendment Retaliation To prevail on a claim a plaintiff must demonstrate: matter of public concern; r rst Amendment retaliation, (i) that his (ii) that he s ch ss a fered an adverse action; and (iii) the existence of a causal connection between spee and adverse action indicati a motivating factor for the adverse action. F.3d 79,9: (2d Cir. 2003); Mandell v. Count 19 that the speech was Cobb v. Pozzi,352 lk, 3:6 F.3d 368,382 (2d Cir. 2003); _R_e_c_k_s_o_n__~____~~________~~v . __ New York State Urban Deve ion, 2006 U.S. Dist. ----------------~------------~--------~-------- Lexis 49269 at *12 (S.D.N.Y. July 12, 2006); Ruotolo v. Cit of New York, 2006 U.S. Dist. Lexis 49903 at *15 (S.D.N.Y. July 19, 2006) . the third element of their retaliation To satis claim, Plaintiffs have alleged that their speech - i.e., their complaints to Defendants and filing of t result Article 78 Action ­ in the adverse action of Defendants depriving Plaintiffs of ir property interest the revenue and business opportunities resulting from installat of the safety systems required forth above, there Plaintif the Statute. and servicing However, as set have no such property interest, and have failed to adequately allege the ir retaliat claim, which is fatal to retaliation claim. See Kuck v. Danaher, rd element of rst Amendment 600 F.3d 159, 167-68 (2d Cir. 2010). Plaintiffs' Request For Injunctive Relief Is Denied Under Second Circuit law, an injunction is properly grant when the aintiff shows "(a) ir 20 rable harm and (b) either (1) to t stions go sufficiently serious s or (2) me likelihood of success on t merits to make them a balance of ha a fair ground for litigation hips tipping cidedly toward the party requesting preliminary relief." Global Mkts. Fund, Ltd., 598 F.3d 30, 35 Dai rtunities Master Inc. v. VGS (2d Cir. 2010) Inc. v. H.P. Hood & S s on Inc., 596 F.2d 70, 72 ~~~~~~~~~~~~~----~~~~~-- (2d Cir. 1979)). PIa iffs have leged that yare entitled to injunctive relief because Defendants' are depriving them of ir property interest granted by the Statute, Regulation and Specifications. Compl. ~~ 92 93. As set fo above, Plaintiffs have no such property interest; accordingly, they have iled to aIle their request an irreparable relief. rm, which is fatal to See ----~--~----~--~------~----~ Fa rt Malmo AB v. Wabtec Corp., 559 F.3d 110, 118 (2d Cir. 2009). 21 Conclusion Upon the conc ions set fo above, Plaintiffs' request for injunctive relief is denied, and Defendants' motion to smiss the Complaint is granted with leave given to replead within twenty days.l It is so ordered. New York, NY September 6--;-2013 ROBERT W. SWEET U.S.D.J. S Plaintiffs' cIa fail on the merits, there is no ne to address Defendants' alternat arguments. 1 22

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