Elcan Industries, Inc. v. Cuccolini S.R.L. et al
Filing
43
MEMORANDUM DECISION AND ORDER granting 11 Motion to Dismiss; granting in part denying in part 18 Motion to Dismiss. The Peters Defendants' motion to dismiss pursuant to Fed. R. Civ. P. 12(b)(2) for lack of personal jurisdiction (ECF 11) is GRANTED. Cuccolini's motion to dismiss for forum non conveniens is DENIED. Cuccolini's motion to dismiss Counts Three, Five and Six for failure to state a claim pursuant Fed. R. Civ. P. 12(b)(6) (ECF 18) is GRANTED. The Clerk of the Court is directed to close the motions at ECF Nos. 11 and 18. (Signed by Judge George B. Daniels on 3/21/2014) (mro) Modified on 3/21/2014 (mro).
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
- ---x
ELCAN INDUSTRIES, INC.,
Plaintiff,
\
-against-
MEMORANDUM
AND ORDER
~CISION
'
CUCCOLINI, S.R.L., PETERS EQUIPMENT,
COMPANY, LLC, and ROBERT RAMSEY
Defendants.
---- ----------X
GEORGE B. DANIELS, District Judge:
Plaintiff Elcan Industries, Inc. brings this action seeking damages and injunctive relief based on
alleged (a) breaches by Defendant Cuccolini of a distribution agreement with Elcan; (b) breaches by
Cuccolini of the implied covenant of good faith and fair dealing; (c) tOliious interference by Peters and
Ramsey with Elcan's contractual relationship with Cuccolini; and (d) tortious interference with Elcan's
other business relationships and opportunities by Peters and Ramsey, in collusion with Cuccolini; and
(e) defamation of Elcan and its business by Cuccolini, Peters, and Ramsey.
Defendants Peters Equipment Company, LLC and Robert Ramsey (the "Peters Defendants")
move to dismiss the Complaint for lack of personal jurisdiction under Fed. R. Civ. P. 12(b)(2) and
failure to state a claim under Fed. R. Civ. P. 12(b)(6). Defendant Cuccolini brings a motion to dismiss
Plaintiffs action in its entirety for forum non conveniens or, in the alternative, to dismiss Plaintiffs noncontractual causes of action for failure to state a claim under Fed. R. Civ. P. 12(b)(6). Plaintiff opposes
the motions, and argues that the exercise of personal jurisdiction over the Peters Defendants is proper
under New York law, that New York is an appropriate forum to adjudicate this dispute, and that Plaintiff
has stated a claim for each cause of action against the Defendants.
The Peters Defendants' motion to dismiss for lack of personal jurisdiction is GRANTED.
Cuccolini's motion to dismiss forJorum non conveniens is DENIED. Cuccolini's motion to dismiss
Plaintiffs breach of covenant of good faith and fair dealing, tortious interference, and defamation claims
for failure to state a claim is GRANTED.
BACKGROUND
Plaintiff Elcan is a New York corporation that sells mechanical screening equipment. (Compl.
~'l
2, 12). Defendant Cuccolini is an Italian limited liability company with its principal place of business
in Reggio Emilia, Italy. (Compl.'; 3). Elcan sells mechanical screening equipment, including those
produced by Defendant Cuccolini, from its headquarters and sole business facilities in New York.
(Compl. '114). Peters Equipment Company is a design and engineering firm that provides services
exclusively to the coal and coke processing industries. (Declaration of Robert Ramsey in Support of
Motion to Dismiss (hereinafter "Ramsey DecL") at'll 2). Robert Ramsey is a citizen of Bluefield,
Virginia, and a member of Peters Equipment Company, LLC, a Virginia-based company. (Id. at '11'1 1-2).
On or about June 14,2010, Blcan and Cuccolini entered into a Distribution Agreement (the
"Agreement") conceming the sale and distribution of certain Cuccolini products. (Compl.';'; 17, 18).
The Agreement made Elcan the exclusive distributor ofthose products in the United States and a non
exclusive distributor in Canada for a period of 5 years. (Compi.
~
19).
On June 13,2013, Plaintiff filed its Complaint against Defendants Cuccolini, Peters and Ramsey.
Plaintiff alleges that the Peters Defendants tortiously interfered with Blcan's distribution agreement with
Cuccolini "by unfair, dishonest or improper means and by agreeing to replace [Plaintiff] as the
distributor of [Cuccolini mechanical screens] in the united States and in Canada." (CompI. 'II 92).
Specifically, Plaintiff alleges that "[ u]pon information and belief, [the Peters Defendants] offered
Cuccolini inducements in order to cause Cuccolini to tenninate its agreement with [Plaintiff]
2
immediately (and without cause) and to replace [Plaintiff] with [the Peters Defendants]," and that
"[ u]pon information and belief, in order to cause Cuccolini to terminate its Agreement with [Plaintiff]
immediately (and without cause), and to replace [Plaintiff] with [the Peters Defendants], [the Peters
Defendants] baselessly disparaged and defamed [Plaintiff] in communications with Cuccolini." (CompI.
~~r
42-43).
Second, Plaintiff alleges that the Peters
Defendants-~in
concert with Cuccolini--tortiously
interfered with Plaintiffs other business opportunities "by unfair, improper, or dishonest means,
including false and misleading statements about [Plaintiff] and its business, in order to obtain those
customers for themselves." (CompI.,r 100). Specifically, Plaintiff alleges that "[u]pon information and
belief, Cuccolini has colluded with [the Peters Defendants] to interfere with [Plaintiffs] business
opportunities~-i.e.,
pending sales by [Plaintiff]
ofProducts~-by
defaming [Plaintiff], by falsely
disparaging and attacking [Plaintiffs] reputation in the market in communications to [Plaintiffs]
customers, and by refusing to deliver Products to [Plaintiff] in accordance with orders placed by
[Plaintiff]," and that "upon information and belief, [the Peters Defendants], in collusion with Cuccolini,
have been and are soliciting [Plaintiffs] customers for Products, and are seeking to usurp [Plaintiffs]
pending sales, notwithstanding the Agreement, by defamation of [Plaintiff s] business reputation."
(CompI. 'I~ 46, 53).
Third, Plaintiff alleges that the Peters Defendants, in concert with Cuccolini, "made false
statements to [Plaintiffs] customers and prospective customers about the quality and nature of
[Plaintiffs] business and capabilities, and concerning [Plaintiffs] ability and willingness to perform its
obligations under the Agreement." (CompI.
~
105). Plaintiff alleges that "upon inforn1ation and belief,
Cuccolini [and/or the Peters Defendants] have made false and/or misleading disparaging statements to
[Plaintiffs] customers about the quality of [Plaintiffs] business capabilities, about [Plaintiffs] ability
3
and/or willingness to perfOlm its obligations under the Agreement, and/or about its business
competence." (CompJ.
,r 54). Plaintiff further alleges that "since June 5, 2013, several of [Plaintiffs]
customers have telminated negotiations with [Plaintiff] or manifestly cooled their relationships with
[Plaintiff] ... [and] sudden changes of this kind are rare in [Plaintiffs] business." (CompI.
I.
'l~
55-56).
LACK OF PERSONAL JURISDICTION OVER THE PETERS DEFENDANTS
To avoid dismissal under Rule 12(b)(2), a plaintiff has the burden of establishing personal
jurisdiction over the defendant. Thomas v. Ashcroft, 470 F.3d 491 (2d Cir. 2006). Where no evidentiary
hearing has been held, nor have the parties engaged in jurisdictional discovery, plaintiff need only make
a prima facie showing on the basis of legally sufficient allegations ofjurisdiction. In re lvfagnetic
Audiotape Antitrust Litig., 334 F.3d 204, 206 (2d Cir. 2003). "The plaintiff cannot rely merely on
conc1usory statements or allegations; rather, the prima facie showing must be 'factually supported. '"
Melnick v. Adelson-Alelnick, 346 F. Supp. 2d 499, 501 (S.D.N.Y. 2004) (citations omitted).
A court considering a motion to dismiss for lack of personal jurisdiction may consider "all
pertinent documentation submitted by the parties" because such a motion is "inherently a matter
requiring the resolution of factual issues outside of the pleadings." Alantello v. Hall, 947 F. Supp. 92, 95
(S.D.N.Y. 1996) (internal quotation marks omitted); accord Dauman v. Hallmark Card, Inc., No. 96
Civ. 3608,1998 WL 54633, at *4 (S.D.N.Y. Feb. 9,1998) (appropriate for court to weigh affidavits on
personal jurisdiction issue); John Hancock Property and Casualty Ins. Co. v. Universale Reinsurance
Co., Ltd., No. 91 Civ. 3644, 1992 WL 26765, at *6 (S.D.N.Y. Feb. 5, 1992); Canadian Group
Underwriters Ins. Co. v. }dlVArctic Trader, No. 96 Civ. 9242, 1998 WL 730334, at
(S.D.N.Y. Oct.
19, 1998). All averments by plaintiff ofjurisdictional facts must be accepted as true and pleadings and
affidavits are to be construed in plaintiffs favor. In re A1agnetic Audiotape, 334 F.3d at 206.
4
A federal court sitting in diversity may exercise personal jurisdiction to the same extent as courts
of general jurisdiction in the state in which it sits. Fed. R. Civ. P. 4(k)(1 )(A); Bank Brussels Lambert v.
Fiddler Gonzalez & Rodriquez, 305 F.3d 120, 124 (2d Cir. 2002). To exercise jurisdiction pursuant to
Fed. R. Civ. P. 4(k)(1 )(a), (1) there must be a statutory basis for the exercise ofjurisdiction under the
applicable state law, here New York law, and (2) it must comport with the Due Process Clause of the
Fourteenth Amendment. ld.
In New York, a plaintiff must demonstrate either that the defendant was "present" and "doing
business" in New York within the meaning of New York Civil Procedure Law and Rules ("CPLR") §
301, or that the defendant committed acts within the scope of New York's long-arm statute, CPLR §
302, including: (i) transacting business in New York; (ii) committing a tortious act while physically
present in New York; or (iii) committing a tortious act outside of New York that results in consequences
in New York. Schulz v. Safra Nat 'Z. Bank ofNew York, 377 Fed. Appx. 101, 102 (2d Cir. 2010). Here,
Plaintiff's allegations fail to establish either general jurisdiction under CPLR § 301 or specific
jurisdiction under CPLR § 302. Because there is no jurisdiction under New York law, this Court need
not reach the due process inquiry.
A. There is No General Jurisdiction under C.P.L.R. § 301
In order to establish general jurisdiction under CPLR § 301, a plaintiff must show that the
"defendant is engaged in such a continuous and systematic course of 'doing business' [in New York] as
to warrant a finding of its 'presence' in this jurisdiction." Zibiz Corp., 777
Supp. 2d at 416. Factors to
be considered under § 301 include: "(1) whether the defendant maintains an office in New York; (2)
whether the defendant has any bank accounts or other property within the state; (3) whether the
defendant has a telephone listing in the state; (4) whether the defendant does public relations work or
5
solicits business within the state; and (5) whether the defendant has employees or agents located within
the state." ld. at 416-17.
Plaintiff has failed to establish that the Peters Defendants are engaged in a continuous and
systematic course of doing business in New York. Specifically, (1) the Peters
Defendants are located in Virginia; (2) Peters Equipment Company is incorporated in West
Virginia; (3) Peters Equipment has no subsidiaries or affiliates in New York; (4) none of Peters
Equipment's officers or directors reside in New York; (5) Peters Equipment has no employees in
New York; (6) the Peters Defendants have never contracted with any persons or entities in New
York; (7) the Peters Defendants have no offices in New York; (8) the Peters Defendants have no
addresses, telephone numbers, bank accounts, or any other tangible or real property in New
York; and (9) the Peters Defendants have never traveled to New York for the purpose of
soliciting business. See Ramsey Decl.,
'I~
1-2, 8-14; 21-22. Thus, this Court lacks general jurisdiction
over the Peters Defendants.
B. The Peters Defendants are Not Subject to Specific Personal Jurisdiction Pursuant to
c.P.L.R. § 302 (a)(l)
Section 302 (a)(1) ofthe New York long-arm statute provides that a court may exercise personal
jurisdiction over any foreign defendant who "transacts any business within the state" if the cause of
action arises from that transaction of business. C.P.L.R. § 302 (a)(1); Agency Rent A Car s.vs. v. Grand
Rent A Car Corp., 98 F.3d 25, 29 (2d Cir. 1996). The Court looks at many factors, no one dispositive,
to determine whether an out-of-state defendant is "transacting business" in New York including if: (1)
there is a continuous "contractual relationship with a New York corporation," (2) the contract was
created, negotiated, or signed in New York, (3) the defendant visited New York to discuss the contract
or negotiate with a New York corporation, (4) there is a choice-of-Iaw clause in the contract, and (5) the
6
contract stipulates that the defendant send money to New York or be supervised by a corporation from
New York. Id. at 29 (citing Hoffritzfor Cutlery, Inc. v. Amajac, Ltd., 763 F.2d 55,58-59 (2d Cir. 1985))
(citations omitted). Furthermore, for a non-domiciliary to transact business, it must purposefully avail
itself of the benefits and protections of New York's laws in conducting its activities in the state. Chloe v.
Queen Bee ofBeverly Hills, LLC, 616 F.3d 158, 170 (2d Cir. 2010). Physical presence in New York,
standing alone, is insufficient to establish purposeful availment. See, e.g., V Cars, LLC v. Isr. Corp., 902
Supp. 2d 349, 360-64 (S.D.N.Y. 2012) (finding no jurisdiction where defendants had engaged in
"exploratory meetings" in New York); Commc 'n Partners World.vide, Inc. v. lvlain St. Res., 2005 U.S.
Dist. LEXIS 14911, at *12-17 (S.D.N.Y. July 25,2005) (no jurisdiction over defendants who
corresponded with parties in New York, or who attended one "isolated meeting" in the state).
The Peters Defendants' actions as alleged do not amount to the transaction of business within
New York State. First, Plaintiff does not allege that the Peters Defendants were physically present in the
state. Rather, the only parties that Plaintiff alleges set foot in New York were Plaintiff and Defendant
Cuccolini. Accordingly, the Peters Defendants cannot be said to have transacted business in the state.
Furthermore, with respect to any allegedly defamatory statements made by the Peters Defendants, "New
York courts do not interpret 'transact[ing] business' to include mere defamatory utterances sent into the
state." Best Van Lines, Inc., 490 F.3d at 248. Rather, "New York courts construe 'transacts any business
within the state' more narrowly in defamation cases than they do in the context of other sorts of
litigation." lei. In defamation cases, "the 'single act' of uttering a defamation, no matter how loudly, is
not a 'transaction of business' that may provide the foundation for personal jurisdiction." Id. Thus, no
in-state activity by the Peters Defendants gave rise to the causes of action alleged here.
7
C. The Peters Defendants are not Subject to Specific Personal Jurisdiction Pursuant to
c.P.L.R. § 302 (a)(2)
Jurisdiction under CPLR § 302(a)(2) exists where the plaintiff alleges that "defendant or his
agents committed a tortious act while physically present in New York." NelvAlarkets Partners LLC v.
Sal. Oppenheim Jr. CIE, 638 F. Supp. 2d 394, 403 (S.D.N.Y. 2009) (citing Bensusan Restaurant Corp.
v. King, 126 F.3d 25, 29 (2d CiL 1997) (internal quotations omitted). However, "[e]ven if [pJaintiff]
suffered injury in New York, that does not establish a tortious act in the state of New York within the
meaning of § 302(a)(2)." Bensusan Restaurant Corp., 126 F.3d at 29.
Here, Plaintiffs only reference to a tortious act in New York is that the Peters Defendants
"engaged in tortious conduct in New York ... that caused injury to [Plaintiff] in New York." Compi.
411:"1
9-10. Because "[c]onclusory allegations do not substitute for evidentiary facts," Plaintiff has failed to
establish jurisdiction under § 302(a)(2). Faherty v. Spice Entm 't, Inc., 2005 U.S. Dist. LEXIS 17976, at
*20 (S.D.N.Y. Aug. 18,2005).
D. The Peters Defendants are not Subject to Specific Personal Jurisdiction Pursuant to
C.P.L.R. § 302 (a)(3)
Jurisdiction pursuant to § 302 (a)(3)(ii) is predicated on five elements: "(1) [t]he defendant
committed a tortious act outside the state; (2) the cause of action arose from that act; (3) the act caused
injury to a person or property within the state; (4) the defendant expected or should reasonably have
expected the act to have consequences in the state; (5) the defendant derives substantial revenue from
interstate or intemational commerce." Gucci Am .. Inc. v. Frontline Processing Corp., 721 F. Supp. 2d
228,241 (S.D.N.Y 2010) (citing Sale Resort, S.A. de C. V v. Allure Resorts Mgmt., LLC, 450 F.3d 100,
106 (3d CiL 2006» (citations omitted).
Under ]\'ew York law, "residence or domicile of the injured party within a State is not a
suHicient predicate for jurisdiction, which must be based upon a more direct injury within the State and
8
a closer expectation of consequences within the State than the indirect financial loss resulting from the
fact that the injured person resides or is domiciled there." Fantis Foods, Inc. v. Standard Importing Co.,
49 N.Y.2d 317,326 (1980); see also Lehigh Valley Indus., Inc. v. Birenbaum, 527 F.2d 87, 94 (2d Cir.
1975). In order to allege injury in the fonTI oflost sales or lost customers for purposes of § 302(a)(3)
those lost sales or lost customers must be within the New York market. See, e.g., Darby Trading Inc. v.
Shell In! 'I Trading & Shipping Co., 568
Supp. 2d 329,336-37 (S.D.N.Y. 2008); Citigroup Inc. v. City
Holding Co., 97 F.Supp.2d 549,568 (S.D.N.Y. 2000).
Plaintiff argues that its claims for tortious interference with contract and with prospective
business relations sound in tort and thus confer long-anTI jurisdiction. Plaintiff alleges the Peters
Defendants:
"... engaged in tortious conduct in New York and elsewhere that
caused injury to [Plaintiff] in New York, and [the Peters
Defendants] expected or reasonably should have expected that
[their] tortious conduct would have adverse effects on [Plaintiff] in
New York, and [they] derive substantial revenue from interstate or
international commerce."
See CompI.
~'r
9-10. Specifically, Plaintiff alleges that "Peters and/or Ramsey intentionally interfered
with [Elcan and Cuccolini's] contractual relationship by procuring Cuccolini's breach of the Agreement
by unfair, dishonest or improper means and by agreeing to replace Elcan as the distributor of Products in
the United States and Canada." CompI.,r 92. Plaintiff further alleges that the Peters Defendants
interfered with Plaintiff's business relations and opportunities "by unfair, improper, or dishonest means,
including false and misleading statements about Elcan and its business, in order to obtain those
customers for themselves." Compi. ,,100. Plaintiff argues that its claims "arise from a wide range of
misconduct" including the Peters Defendants' (1) "misrepresentat[ion of] their intentions to cause
Cuccolini to breach the Agreement without cause and to loot Elcan's customers"; (2) concealment of
their activities in setting up a joint venture with Cuccolini; (3) misappropriation ofElcan's confidential
9
customer information; (4) concealment and misrepresentation of their identities "in claiming to be
representatives of another company so as to learn about Elcan's confidential and proprietary business
and technical methods and strategies in Elcan's own facilities in N ew York"; and (5) participation with
Cuccolini "in threatening and intimidating Grotto [£lcan's President] in order to bully Elcan into giving
up its exclusivity and other rights under the Agreement with Cuccolini in favor of Ramsey or Peters."
Plaintiffs Memorandum of Law in Opposition to Motion by Defendants Peters Equipment and Ramsey
to Dismiss Complaint Against Them ("Opp. Br.") at 14.
Plaintiff also argues that it suffered injury in New York because it lost business or customers
within the state as a result of the Peters Defendants' conduct. !d. at 15. Specifically, Plaintiff alleges
that "Peters and/or Ramsey caused injury to the business relationship between Elcan and Cuccolini, to
Elcan's detriment." CompI.
~
94. Plaintiff also alleges that it suffered injury when "Peters and/or
Ramsey, in collusion with Cuccolini, injured the relationships between £lean and those customers by
causing those customers to withdraw their business from Elcan." CompI.
~
101.
Because Plaintiff does not identify any lost customers in New York as a result of tortious
conduct by the Peters Defendants, Plaintiff has not alleged that it suffered any cognizable injury in New
York giving rise to jurisdiction over the Peters Defendants under CPLR § 302(a)(3). Plaintiff has
alleged no facts that would support a conclusion of foreseeable injury suffered in New York. Because
the complaint does not demonstrate personal jurisdiction over the Peters Defendants, this Court will not
further address Plaintiffs failure to factually allege a sufficient cause of action against them.
FORUM NON CONVENIENS
Forum non conveniens is a discretionary device permitting a court in rare instances to "dismiss a
claim even if the court is a permissible venue with proper jurisdiction over the claim." PT United Can
Co. v. Crown Cork & Seal Co., 138 F.3d 65, 73 (2d Cir.l998); see also Gulf Oil Corp. v. Gilbert, 330
10
U.S. 501,507 (1947). In assessing whether forum non conveniens dismissal is appropriate, courts
engage in a two-step process: (i) courts first determine if an adequate alternative forum exists. See, e.g.,
Piper Aircraft Co. v. Reyno, 454 U.S. 235,254 n. 22, 102 S.Ct. 252, 70 L.Ed.2d 419 (1981); Gilbert,
330 U.S. at 506-07; (ii) if so, courts balance a series of factors involving the private interests of the
parties in maintaining the litigation in the competing fora and any public interests at stake. See, e.g., id.
at 508-09. The defendant bears the burden to establish that an adequate alternative forum exists and then
to show that the pertinent factors "tilt[ ] strongly in favor oftrial in the foreign forum." R. lvfaganlal &
Co., 942 F.2d at 167. "[T]he plaintiffs choice of forum should rarely be disturbed." Gilbert, 330 U.S. at
508,67 S.Ct. 839.
Although England is an adequate alternative forum agreed to by the contracting parties, I a
balancing of the relevant factors tilts in favor of Plaintiff s chosen New York forum. First, because
New York is Elcan's home forum, Elcan's selection of this court in New York must be given "the
greatest deference." In addition, the dispute with respect to Elcan has strong connections to New York
and the United States. The contract was executed upon Grotto's signature in New York. The subject
matter of the contract is an exclusive distributorship in the United States. The contract contemplated
Elcan's performance in the United States, and the purported termination of that contract was, according
to Cuccolini, based on that performance in the United States. Most, if not all, non-party witnesses are in
the United States, including the current and/or prospective customers of Elcan, and other Elean
customers who can testify to the quality issues concerning Cuccolini's products. Elcan's efforts to bring
the Cuccolini products to saleable condition took place in the United States. Finally, Elcan alleges that
it has suffered injury to its business with customers in New York.
I The availability of an adequate alternative fomm "[0 Jrdinarily ... will be satisfied when the defendant is amenable
to process in the other jurisdiction" and the alternative fomm "permit[ sJ litigation of the subject matter in dispute." Piper
Aircraft Co, v. Reyno, 454 U.S. 235,254 n.22 (1981); see also Pollux Holding Ltd. v, Chase lvfanhattan Bank, 329 F.3d 64,
75 (2d eiL 2003), cert, denied, 540 U.S. 1149 (2004).
11
Contrary to Cuccolini's assertion, the distribution agreement did not contain a mandatory forum
selection clause. Section 28.2 provides that "the courts of England and Wales shall have the necessary
jurisdiction to settle any dispute or claim that arises out of or in connection with this Agreement or
subject matter." Meanwhile, Section 28.3 expressly provides that "[t]he parties shall nonetheless retain
the right within their discretion to institute proceedings in any court having jurisdiction." Distribution
Agreement (Complaint Exh. "A") § 28.3. Thus, the Agreement provided that an English court would
have jurisdiction, but is not the selected exclusive forum, for dispute resolution. Rather, the selection of
a forum was expressly left to the parties' discretions.
Furthernlore, the London suit that Cuccolini filed before Elcan sued in New York does not weigh
in favor of dismissal. The Second Circuit has mandated that "the mere existence of parallel foreign
proceedings does not negate the district courts' virtually unflagging obligation to exercise the
jurisdiction given them." Royal & Sun Alliance Ins. Co. a/Can. v. Century Int'! Arms, Inc., 466 F.3d 88,
92 (2d Cir. 2006) (internal quotations omitted). "The task of a district court evaluating a request for
dismissal based on a parallel foreign proceeding is not to articulate a justification for the exercise of
jurisdiction, but rather to deternline whether exceptional circumstances exist that justify the surrender of
that jurisdiction." Id. at 93. Importantly, "circumstances that routinely exist in connection with parallel
litigation cannot reasonably be considered exceptional circumstances, and therefore the mere existence
of an adequate parallel action, by itself, does not justify the dismissal of a case on grounds of
international comity abstention." Id. at 95. Cuccolini has not identified any "exceptional circumstances"
here.
Finally, any inconvenience to Cuccolini in litigating in this Court does not outweigh Elcan's
forum choice. Cuccolini and its parent company have had a strong business presence in the United
States, including in New York, for years, including sales to Elcan of its Cuccolini Products, their
12
admitted Recovery 21 venture with Peters Equipment in the coal-producing regions of the United States,
and their Domino's pizza franchises in the Northwest United States. (Vandenberg Decl.
,,'1 4-6; Grotto
Decl. 2 ~~ 14,18.). Moreover, although England was designated as the parties' neutral available forum,
it has no connection with either party, their contract or the pending dispute. Defendant Cuccolini's
motion to dismiss on the grounds offorum non conveniens is denied.
FAILURE TO STATE A CLAIM AGAINST CUCCOLINI
To survive a motion to dismiss under Rule 12(b)(6), "a complaint must contain sufficient factual
matter, accepted as true, to state a claim to relief that is plausible on its face." Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009) (quoting Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). "A claim has
facial plausibility where the plaintiff pleads factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged." Id. The court must accept all well
pleaded factual allegations in the complaint as true, and draw all reasonable inferences in the plaintiffs
favor. Chambers v. Time Warner, Inc., 282 F. 3d 147, 152 (2d Cir. 2002). "The complaint may be
dismissed only where 'it appears beyond doubt that the plaintiff can prove no set of facts in SllppOli of
his claim which would entitle him to relief. ", Gant v. Wallingford Bd. ofEduc., 69 F .3d 669, 673 (2d
Cir. 1995); Allen v. WestPoint-Pepperell, Inc., 945 F .2d 40, 44 (2d Cir.199l ) (quoting Conley v.
Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 10102,2 L.Ed.2d 80 (1957)); see also Sweet v. Sheahan, 235
F.3d 80, 83 (2d Cir. 2000).
A. Plaintiff Failed to Allege Breach of Covenant of Good Faith and Fair Dealing
In support of its third claim, Elcan alleges that "Cuccolini purported in bad faith to terminate the
Agreement without any valid basis, and thereafter has failed and refused to sell, deliver or otherwise
provide Products to Elcan for sale in the United States and Canada, and has filed and refused to
cooperate with Elcan with respect to marketing and sales of Products in the United States and Canada."
13
CompI.
~
85. Elcan also alleges that Cuccolini knowingly supplied Elcan with defective products.
CompI.
~
87.
The Complaint fails to state a cause of action for a breach of the covenant of good faith and fair
dealing because it simply realleges violations of express contractual provisions. See Fleisher v. Phoenix
Life Ins. Co., 858 F. Supp. 2d 290,299 (S.D.N.Y. 2012) (explaining that "[c]laims of breach of the
implied covenant ... must be premised on a different set of facts from those underlying a claim for
breach of contract") (internal citations and quotations omitted). Specifically, Elcan's allegations related
to its claim for a breach of the covenant of good faith and fair dealing simply repeat its allegations in
paragraphs 64-66 for breach of contract. Furthermore, Elcan's allegation in paragraph 87 regarding
defects in products supplied by Cuccolini is merely an allegation for a breach of Section 13.2 of the
distribution agreement, which warrants that the products "will be free of material defects." Elcan's
breach of the covenant of good faith and fair dealing claim is therefore dismissed as redundant to its
breach of contract claim. Count Three alleging a breach of the covenant of good faith and fair dealing is
dismissed.
B. Plaintiff Failed to Allege Tortious Interference with Other Business Opportunities
In order to state this claim under New York Law, a Plaintiff must allege that (1) it had business
relations with a third party; (2) Cuccolini interfered with those business relations; (3) Cuccolini acted for
a wrongful purpose or used dishonest, unfair, or improper means; and (4) Cuccolini's acts injured those
relations. See Catskill Dev., L.L.C v. Park Place Entm 't Corp., 547 F.3d 115, 132 (2d Cir. 2008); see
also Goldhirsh Group, Inc. v. Alpert, 107 F.3d 105,108-109 (2d Cir. 1997); Carvel Corp. v. Noonan, 3
N.y'3d 182, 189-90,818 N.E.2d 1100, 1103,785 N.Y.S.2d 359,362 (2004). Here, Plaintiff's
allegations fall far short of this standard. "In the case of tortious interference with business
relations ... the 'plaintiff must show more culpable conduct on the part of the defendant,'" than
14
is required to show tortious interference with contract. Valley Lane Indus. Co. v. Victoria's
Secret Direct Brand Mgmt., L.L.C, 455 Fed. Appx. 102, 105-106 (2d Cir. N.Y. 2012) (quoting
Noonan, 3 N.YJd at 189-90,818 N.E.2d at 1103,785 N.Y.S.2d at 362»). Rather, "the defendant's
conduct must amount to a crime or an independent tort." Id.
The Complaint fails to state a cause of action for tortious interference with prospective business
relations because it does not allege that any ofCuccolini's conduct was criminal or otherwise wrongful.
Furthermore, because the Complaint does not allege what Cuccolini said to Plaintiffs customers and
what the effect of those statements were, this Court cannot determine whether the alleged conduct
amounts to an "independent tort" sufficient to give rise to a claim for tortious interference with
prospective business relations. See generally Valley Lane Indus. Co., 455 Fed. Appx. at 106; see also
Ritani, LLC v. Aghjayan, 880 F. Supp. 2d 425, 451 (S.D.N.Y. 2012) (holding that complaint must allege
defendant directly interfered with and convinced third party not to do business with plaintiff). Counts
Four and Five alleging tortious interference with contractual relations and other business opportunities
are dismissed.
C. Plaintiff Failed to Allege Defamation
To survive a motion to dismiss a defan1ation claim, a plaintiff must, "identifly] the purported
communication, and [indicate] who made the communication, when it was made, and to whom it was
communicated." Fleming v. Hymes-Esposito, 2013 U.S. Dist. LEXIS 45912, at *20-21 (S.D.N.Y. Mar.
29,2013) (quoting Prowley v. Hemar Ins. Corp. ofAm., U.S. Dist. LEXIS 45249, at *6 (S.D.N.Y. May
7,2010) (internal quotations omitted); accord Thai v. Cayre Group, Ltd., 726 F. Supp. 2d 323,329-30
(S.D.N.Y. 2010). Here, the complaint fails to identify who made the allegedly defamatory statements,
what those statements were, when they were made, or where. Rather, Plaintiff alleges only that the
temlination letter Cuccolini sent to Plaintiff contained "false and misleading statements about
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[Plaintiff sJ performance, capabilities, and business manner, including the assertion that [Plaintiff] is
incapable of performing its obligations under the Distribution Agreement," and that Cuccolini or the
Peters Defendants may have communicated some of these non-specific statements to Plaintiffs
customers. See CompL 'Il'll59-60, 105. These allegations lack the specificity required to set forth a
defamation claim. See Cruz v. Marchetto, 2012 U.S. Dist. LEXIS 142662, at *9 (S.D.N.Y. Sept. 28,
2012) (failure to specifically plead "when, where, or in what manner the statements were made,"
necessitates dismissal of defamation claim). Count Six alleging defamation is dismissed.
CONCLUSION
The Peters Defendants' motion to dismiss pursuant to Fed. R. Civ. P. 12(b)(2) for lack of
personal jurisdiction (ECF 11) is GRANTED. Cuccolini's motion to dismiss for forum non conveniens
is DENIED. Cuccolini's motion to dismiss Counts Three, Five and Six for failure to state a claim
pursuant Fed. R Civ. P. 12(b)(6) (ECF 18) is GRANTED.
The Clerk ofthe Court is directed to close the motions at ECF Nos. II and 18.
Dated: March 21, 2014
New York, New York
So ORDERED
tates District Judge
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