Williams v. Rosenblatt Securities Inc.
OPINION AND ORDER re: 124 MOTION for Partial Summary Judgment. filed by Steven A. Williams, 108 MOTION to Dismiss Fourth Amended Complaint. filed by Integral Derivatives, 105 MOTION to Dismiss . filed by Jane St. Capital, 118 MOTION to Strike Document No. 33 . filed by Steven A. Williams, 135 MOTION for Conference. filed by Steven A. Williams, 134 MOTION to Strike Document No. 118 . filed by Steven A. Williams, 111 MOTION to Dismiss Plaintiff's Fourth Amended Complaint. filed by Rosenblatt Securities Inc., 113 MOTION to Dismiss . filed by Lorraine Henricks(Turanski). The Court has considered all of the arguments of the parties. To the extent not spec ifically addressed above, the remaining arguments are either moot or without merit. For the foregoing reasons, the motions to dismiss by Jane St (ECF No. 105), Integral (ECF No. 108), and Dr. Henricks (ECF No. 113) are granted. The plaintiff' s claims against these defendants are dismissed, except that the claim for medical malpractice against Dr. Henricks, and the NYHRL claims against Jane St. and Integral are dismissed without prejudice because the Court has declined to exercise supp lemental jurisdiction over those claims. Pursuant to Fed. R. Civ P. 54(b), there is no just reason for delay in entering a final judgment dismissing the claims against Jane St., Integral, and Dr. Henricks, and a final judgment will be entered acco rdingly. The RSI Defendants' motion to dismiss is granted in part and denied in part. The motion by the RSI Defendants to dismiss the Dodd-Frank claim, the claim under Title I of the ADA, and the claim under NYHRL against the RSI Defendants i s denied. The remaining claims against the RSI Defendants are dismissed. All pending motions by the plaintiff (ECF No. 118, 124, 133, 134, 135) are denied. The plaintiff's application for a preliminary injunction is denied. The foregoing const itutes the Court's findings of facts and conclusions of law pursuant to Fed. R. Civ. P. 52 (a)(2). The Clerk is directed to close all pending motions, and to enter a judgment pursuant to Fed. R. Civ. P. 54(b) dismissing the claims against Jane St., Integral, and Dr. Henricks as explained above. (Signed by Judge John G. Koeltl on 10/7/2015) (kgo)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
STEVEN A. WILLIAMS,
14 Civ. 4390 (JGK)
- against -
OPINION AND ORDER
ROSENBLATT SECURITIES INC., ET AL.,
JOHN G. KOELTL, District Judge:
The plaintiff, Steven Williams, was employed by the
defendant, Rosenblatt Securities Inc. (“RSI”) for less than a
year in 2012. He claims primarily that he was terminated in
retaliation for his activities as a whistleblower for the
Securities Exchange Commission (“SEC” or “Commission”) and that
he was the victim of employment discrimination based on a
perception that he was mentally ill. While he was a strategist
at RSI, the plaintiff published a research report that
purportedly implicated defendant Jane St. Capital (“Jane St.”)
in violations of securities laws. RSI did substantial business
with Jane St. The plaintiff claims that he was harassed and
eventually discharged from RSI because of the report. In the
course of the alleged harassment, he was perceived by RSI and
others in the financial industry as having a mental illness. RSI
required him to undergo medical examinations by defendant Dr.
Loraine Henricks (“Dr. Henricks”) as a condition of continued
employment. The plaintiff received treatment from Dr. Henricks,
but refused to take anti-psychotic medication. After being
terminated, the plaintiff’s prospect of employment was allegedly
affected by rumors spread by employees of Jane St. and defendant
Integral Derivatives (“Integral”) regarding his perceived mental
The plaintiff brought the current lawsuit on June 14, 2014
and filed his fourth amended complaint (“FAC”) on April 8, 2015,
making nine distinct claims against RSI and several RSI
employees 1 (collectively “RSI Defendants”), Jane St., Integral,
and Dr. Henricks. On April 24, 2015, the RSI Defendants, Jane
St., Integral, and Dr. Henricks each filed a motion pursuant to
Fed. R. Civ. P. 12(b)(6) to dismiss all claims against them.
After the defendants filed their motions to dismiss, the
plaintiff filed, in chronological order, a motion to strike
parts of the RSI Defendants’ motion to dismiss, a motion for
partial summary judgment, a motion for partial judgment on the
pleadings, a motion to strike various affirmative defenses by
Dr. Henricks, and a motion for a conference to file a fifth
amended complaint. Most recently the plaintiff brought an order
to show cause for a temporary restraining order and a
The named RSI employees include Richard Rosenblatt, Joseph
Gawronski, Gordon Charlop, Charles Roney, Justin Schack, Joseph
Benanti, Scott Burrill, Gary Wishnow, and Alex Kemmsies.
preliminary injunction. These motions and applications will be
discussed in turn.
In deciding a motion to dismiss pursuant to Rule 12(b)(6),
the allegations in the complaint are accepted as true, and all
reasonable inferences must be drawn in the plaintiff’s favor.
See McCarthy v. Dun & Bradstreet Corp., 482 F.3d 184, 191 (2d
Cir. 2007). The Court’s function on a motion to dismiss is “not
to weigh the evidence that might be presented at a trial but
merely to determine whether the complaint itself is legally
sufficient.” Goldman v. Belden, 754 F.2d 1059, 1067 (2d Cir.
1985). The Court should not dismiss the complaint if the
plaintiff has stated “enough facts to state a claim to relief
that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550
U.S. 544, 570 (2007). “A claim has facial plausibility when the
plaintiff pleads factual content that allows the court to draw
the reasonable inference that the defendant is liable for the
misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678
(2009). While the Court should construe the factual allegations
in the light most favorable to the plaintiff, “the tenet that a
court must accept as true all of the allegations contained in a
complaint is inapplicable to legal conclusions.” Id.; see also
A’Gard v. Perez, 919 F. Supp. 2d 394, 398-99 (S.D.N.Y. 2013).
Where a pro se litigant is involved, the same standards for
dismissal apply. However, when deciding a motion to dismiss, the
Court may consider allegations that are contained in a pro se
plaintiff’s opposition papers. See Burgess v. Goord, No.
98cv2077 (SAS), 1999 WL 33458, at
1 (S.D.N.Y. Jan. 26, 1999)
(collecting cases). Moreover, a “‘court should give the pro se
litigant special latitude in responding to a motion to
dismiss.’” Gaston v. Gavin, No. 97cv1645 (JGK), 1998 WL 7217, at
1 (S.D.N.Y. Jan. 8, 1998), aff’d, 172 F.3d 37 (2d Cir. 1998)
(quoting Adams v. Chief of Sec. Operations, 966 F. Supp. 210,
211 (S.D.N.Y. 1997)); Andujar v. McClellan, No. 95cv3059 (JGK),
1996 WL 601522, at
1 (S.D.N.Y. Oct. 21, 1996); see also Kaplan
v. New York State Dep’t of Corr. Servs., No. 99cv5856 (JGK),
2000 WL 959728, at *1 (S.D.N.Y. July 10, 2000).
When presented with a motion to dismiss pursuant to Rule
12(b)(6), the Court may consider documents that are referenced
in the complaint, documents that the plaintiff relied on in
bringing suit and that are either in the plaintiff’s possession
or that the plaintiff knew of when bringing suit, or matters of
which judicial notice may be taken. See Taylor v. Vt. Dep’t of
Educ., 313 F.3d 768, 776 (2d Cir. 2002); Chambers v. Time
Warner, Inc., 282 F.3d 147, 153 (2d Cir. 2002); see also A’Gard,
919 F. Supp. 2d at 399.
The following facts are alleged by the plaintiff. On
January 15, 2012, the plaintiff started working at RSI as the
Chief Derivatives and ETP (Exchange Traded Products) Strategist.
On April 13, 2012, the plaintiff published a report which
explored how Credit Suisse allegedly colluded with high
frequency trading (“HFT”) firms in the securities lending market
to manipulate the market price for TVIX (Velocity Shares 2x
Volatility ETN), an exchange-traded note managed by Credit
Suisse. While the report stated that “no securities laws were
broken,” it nevertheless suggested that there were violations of
section 10(b) of the Securities Exchange Act of 1934 and of SEC
Rule 10b-5. (FAC ¶¶ 1-5 at 1-2 2; Pl’s Opp’n at 5-7.) A copy of
the report was forwarded to the SEC. (FAC ¶ 17.) Shortly after
it was published, two SEC staff members not on the report’s
distribution list requested permission to see the report. (Id.
¶ 19.) On April 16, 2012, the SEC opened an investigation into
Credit Suisse and several HFTs with regard to the alleged
The first two pages of the FAC contained five consecutively
numbered paragraphs, but starting on the third page the FAC
numbered the paragraphs with a new list. The FAC is not
paginated. In order to avoid confusion, the first five
paragraphs will be cited with page references. Paragraphs
starting from page 3 will be cited by the paragraph number
without page references.
On April 16, 2012, Richard Rosenblatt (“Rosenblatt”), the
CEO of RSI, called the plaintiff into his office, and warned him
that “it was not [their] job to police the market.” (Id. ¶ 20.)
Employees from Credit Suisse and other financial firms
subsequently phoned RSI and the plaintiff to express their
concern over the report. (Id. ¶¶ 21-23.) Within the next month,
the plaintiff was pulled from important projects, and several
members of RSI’s management team stopped interacting with the
plaintiff. (Id. ¶¶ 24, 25, 28.)
Jane St. is an HFT firm, and RSI allegedly derives eighty
percent of its revenues facilitating high frequency trading for
Jane St. (Id. ¶¶ 18, 100.) On May 16, 2012, two RSI partners,
Joseph Gawronski (“Gawronski”) and Scott Burrill (“Burrill”),
contacted the plaintiff inquiring whether Jane St. was involved
in a trade similar to that discussed in the plaintiff’s report.
(Id. ¶ 30.) The plaintiff responded that it was very likely but
there was no way to be certain. (Id.) Later that month, Jane St.
traders Dan Macklowitz (“Macklowitz”) and Hector Guardinez
(“Guardinez”) exchanged emails and met with RSI officer Gary
Wishnow (“Wishnow”). (Id. ¶¶ 31, 111.)
According to the plaintiff, soon after the email exchange
and the meeting, Jane St. and the RSI Defendants conspired to
retaliate against him for writing the report that may have
implicated Jane St. (Id. ¶ 111.) The plaintiff was moved from
the trading floor, away from his colleagues, and into an office
of his own. (Id. ¶ 33.) In the next few months, the plaintiff
alleges, the RSI Defendants engaged in a concerted campaign of
harassment identified by the plaintiff as “gaslighting” 3 with the
purpose of inducing the deterioration of the plaintiff’s mental
state. (Id. ¶ 3.) Wishnow, the plaintiff’s immediate supervisor,
allegedly sabotaged the data program used by the plaintiff, and
as a result, the plaintiff had to “work unreasonable hours to
produce less than exceptional work.” (Id. ¶¶ 34, 36.) After the
plaintiff’s constant complaints, Gawronski, the COO of RSI,
assigned Alex Kemmsies (“Kemmsies”) as a support person to the
plaintiff and had the plaintiff report directly to Gawronski
instead of Wishnow. (Id. ¶¶ 38-41.) From July to September of
2012, Kemmsies repeatedly sent the plaintiff erroneous data with
significant delays. (Id. ¶ 47.) Both Kemmsies and Gawronski
repeatedly changed the content of draft reports submitted by the
plaintiff despite the plaintiff’s persistent objections. (Id.)
Starting from June 2012, the plaintiff’s mental condition
caught the attention of RSI’s management. In June 2012,
Rosenblatt gave the plaintiff a book on Attention Deficit
The plaintiff describes gaslighting as an effort “to induce a
severe sense of anxiety into the target and to cause others to
regard him as mentally unstable” by completely “annihilate[ing]”
the target’s reputation and causing the target “personal
disasters such as job loss, divorce, financial devastation –
even jail.” (FAC ¶ 3.)
Disorder (ADD) after commenting that the plaintiff’s report
“looks like somebody with ADD wrote it.” (Id. ¶ 35.) Around
early July 2012, Rosenblatt required the plaintiff, as a
condition of his continued employment, to be treated by Dr.
Henricks, a psychiatrist and friend of Rosenblatt. (Id. ¶ 42.)
The plaintiff alleges that during the course of treatment,
Dr. Henricks tried to convince the plaintiff that he was
mentally unstable, overprescribed medications, engaged in
aggressive therapy for the plaintiff that triggered his trauma,
shared the plaintiff’s privileged information without his
consent, and eventually abandoned the plaintiff after his
employment was terminated. The plaintiff contends that although
Dr. Henricks prescribed anti-psychotic medicine for him, he
eventually did not take the medicine. (Id. ¶¶ 60-70, 114.)
On or about September 24, 2012, the plaintiff attended a
psychiatric session with Dr. Henricks.
Rosenblatt also attended
the session after the plaintiff invited him, although the
invitation was allegedly sarcastic. (Id. ¶¶ 48-51.) After the
plaintiff refused to take anti-psychotic medication despite the
pleas of Dr. Henricks and Rosenblatt, the plaintiff was
terminated from RSI. (Id. ¶ 51.)
After he was terminated, the plaintiff requested access to
his stored emails. RSI agreed to grant access, but withheld the
emails for several weeks, allegedly tampered with the contents,
and created technical obstacles for access to the attachments of
the emails. The plaintiff later “had the emails forensically
analyzed” and was able to open the attachments. (Id. ¶ 54.)
In July 2013, the plaintiff was hired by Kirk Katsberg
(“Katsberg”) as a wire clerk. (Id. ¶ 77.) Initially Katsberg
offered the plaintiff $7,000 per-month in a “draw versus
commissions.” (Id.) Katsberg later mentioned this hiring
arrangement to Ben Phillips (“Phillips”), a trader at Integral
Derivatives (“Integral”). (Id. ¶ 83.) Phillips told Katsberg
that “I wouldn’t hire Steve if I were you; he’s got problems.”
(Id.) When reminded there might be another side to the story,
Phillips replied: “The first side is so crazy that I don’t want
to hear the second.” (Id. ¶ 84.) Katsberg subsequently dropped
his offer of the $7,000 draw to straight commissions. (Id.
When the plaintiff showed up to work at the New York Stock
Exchange (“NYSE”), he was stopped at the entrance and told that
he was banned from the NYSE. (Id. ¶ 78.) Although this ban was
lifted after the plaintiff met with the head of security of the
NYSE, he was nevertheless stopped by security personnel several
times afterwards and permitted entrance only after receiving
clearance from RSI. (Id. ¶¶ 78-81.) The plaintiff stopped going
to work after being stopped by NYSE security for the fourth
time. (Id. ¶ 87.)
In October 2013, the plaintiff was hired by Kamran Gille as
an off-floor equity options broker and was offered $5,000 per
month draw against commission. (Id. ¶ 93.) Karman Gille
retracted the offer two days later, and he told the plaintiff
that two Jane St. employees, Dan Macklowitz and Hector
Guardinez, were “crushing” the plaintiff and that, because Jane
St. was ruining the plaintiff’s reputation, he would be better
off to consider employment outside New York. (Id. ¶ 95, 97.)
David Lucerne from Morgan Stanley also told the plaintiff that
Jane St. was “shitting all over his name.” (Id. ¶ 96.)
The plaintiff brought a lawsuit on June 14, 2014, and he
filed an amended complaint on June 18, 2014. On December 5,
2014, with the Court’s permission, the plaintiff filed a second
amended complaint (“SAC”). In February 2015, several defendants
named in the second amended complaint filed motions to dismiss
various claims contained in the SAC. Without seeking leave, the
plaintiff filed a third amended complaint on February 27, 2015.
On March 24, 2015, the Court held a conference and granted the
plaintiff leave to amend the complaint yet again, but only to
add the individual RSI employee defendants whom the plaintiff
claimed to have inadvertently dropped in the process of amending
the pleadings. (ECF No. 101). The Court explicitly ordered that
those would be the only changes permitted and no further
pleadings were allowed without express permission of the Court.
(Id.) The plaintiff’s fourth amended complaint was due on April
The plaintiff filed his fourth amended complaint on April
8, 2015, making nine distinct claims against the RSI Defendants,
Jane St., Integral, and Dr. Henricks. More specifically, the
plaintiff alleges the following causes of action: (1) violations
of the Anti-Retaliation provisions of the Dodd-Frank Act, 15
U.S.C. § 78u-6(h)(1)(c), against the RSI Defendants; (2)
violations of the Stored Communications Act (“SCA”), 18 U.S.C.
§ 2701, against RSI; (3) violations of the Americans with
Disabilities Act (“ADA”), 42 U.S.C. § 12112, against RSI; (4)
violations of the New York Human Rights Law (“NYHRL), N.Y. Exec.
L. § 292(21)(c), against RSI; (5) violations of the ADA, 42
U.S.C. § 12102(2)(c), against Jane St. and Integral; (6)
violations of the NYHRL, N.Y. Exec. L. § 292(21)(c), against
Jane St. and Integral; (7) violations of 42 U.S.C. § 1985(3)
against the RSI Defendants, Jane St., and Integral; (8)
violations of 42 U.S.C. § 1986 against the RSI Defendants, Jane
St., Integral, and Dr. Henricks; (9) medical malpractice against
Dr. Henricks. On April 24, 2015, the RSI Defendants, Jane St.,
Integral, and Dr. Henricks each filed motions to dismiss all
claims against them pursuant to Rule 12(b)(6). The plaintiff’s
The plaintiff alleges six claims against the RSI Defendants
for their violations of: 1) the Dodd-Frank Anti-Retaliation
provisions; 2) The SCA; 3) Title I of the ADA; 4) 42 U.S.C.
§1985(3); 5) 42 U.S.C. §1986; and 6) the NYHRL. The RSI
Defendants move to dismiss all the claims. For reasons explained
below, their motion is granted in part and denied in part.
1.Dodd-Frank Anti-Retaliation Provisions
The Dodd–Frank statute added to the Exchange Act a section
21F, titled “Securities Whistleblower Incentives and
Protection.” 15 U.S.C. § 78u–6. Subsection 21F(h) prohibits
employers from retaliating against employees for reporting
certain violations. That subsection provides:
No employer may discharge, demote, suspend,
threaten, harass, directly or indirectly, or
in any other manner discriminate against, a
whistleblower in the terms and conditions of
employment because of any lawful act done by
Commission in accordance with this section;
assisting in any investigation or judicial
or administrative action of the Commission
based upon or related to such information,
required or protected under the SarbanesOxley Act of 2002 (15 U.S.C. 7201 et seq.),
this chapter, including section 78j–1 (m) of
this title, section 1513 (e) of title 18,
and any other law, rule, or regulation
15 U.S.C. § 78u–6(h)(1)(A).
The statute defines “whistleblower” as “any individual
who provides . . . information relating to a violation of
the securities laws to the Commission, in a manner
established, by rule or regulation, by the Commission.” 15
U.S.C. § 78u-6(a)(6). Under SEC rules, for purposes of the
anti-retaliation protections afforded by Section 21F(h)(1)
of the Exchange Act (15 U.S.C. § 78u–6(h)(1)), one is a
(i) You possess a reasonable belief that the
information you are providing relates to a
possible securities law violation (or, where
applicable, to a possible violation of the
1514A(a)) that has occurred, is ongoing, or
is about to occur, and;
(ii) You provide that information in a
manner described in Section 21F(h)(1)(A) of
(iii) The anti-retaliation protections apply
whether or not you satisfy the requirements,
procedures and conditions to qualify for an
17 C.F.R. § 240.21F–2(b)(1).
The plaintiff contends that he believed there were 10(b)
and 10b-5 violations by a syndicate of Credit Suisse and various
HFT firms. He undertook a protected activity by writing and
publishing a report that explained these violations, and
forwarded this report to the SEC. Two SEC staff members
specifically requested this report. Soon afterwards the SEC
initiated an investigation of these violations and it could be
inferred that the plaintiff initiated and assisted in this SEC
investigation. Therefore he qualifies as a whistleblower.
The plaintiff further alleges that his employer, RSI, had
business connections with Jane St., an HFT firm that might have
been implicated by his report, and that he suffered from
retaliatory harassment and discharge as a result of his report.
Therefore he claims to be entitled to statutory relief under 15
U.S.C. § 78u–6(h)(1)(C).
For purpose of the motion only, the RSI Defendants do not
contest the factual allegations of retaliation. They move to
dismiss on the grounds that the plaintiff did not report any
securities law violation, and whatever he did report was not
done in accordance with the Commission’s reporting rule.
Therefore they argue as a matter of law the plaintiff cannot be
entitled to any whistleblower protection.
The RSI Defendants are mistaken. On their first point,
although the plaintiff did say at one point in his complaint
that “no securities laws were broken,” he went on in the same
sentence to allege that there were violations of section 10(b)
of the Securities Exchange Act and Rule 10b-5 promulgated
thereunder. (FAC ¶ 5 at 2.)
The RSI Defendants argue that the plaintiff merely reported
some conduct that exploited a regulatory loophole, but the
plaintiff’s pleadings are sufficient to allege that he provided
information about possible violations of the securities laws.
The Commission’s Regulations provide that, for purpose of antiretaliation protection, a whistleblower is one who possesses “a
reasonable belief that the information [provided] relates to a
possible securities law violation.” 17 C.F.R. § 240.21F–
The regulations only require that a whistleblower have a
reasonable belief that a violation of the securities laws has
occurred. When it adopted this standard, the Commission
explained: “The ‘reasonable belief’ standard requires that the
employee hold a subjectively genuine belief that the information
demonstrates a possible violation, and that this belief is one
that a similarly situated employee might reasonably possess.”
Implementation of the Whistleblower Provisions of Section 21f of
the Sec. Exch. Act of 1934, SEC Release No. 64545, 2011 WL
2045838, at 16 (May 25, 2011) (emphasis in original). The
Commission cited Livingston v. Wyeth, Inc., 520 F.3d 344 (4th
Cir. 2008), a case that interpreted the whistleblower protection
in the Sarbanes-Oxley Act. See Livingston, 520 F.3d at 352
(Plaintiff “must show not only that he believed that the conduct
constituted a violation, but also that a reasonable person in
his position would have believed that the conduct constituted a
violation.”); see also Ott v. Fred Alger Mgmt. Inc., 11cv4418
(LAP), 2012 WL 4767200 at *6 (S.D.N.Y. Sep.27, 2012) (denying
motion to dismiss Dodd-Frank whistleblower claim where the
plaintiff “plausibly alleged that a similarly situated employee
might reasonably possess a belief that the [reported activity]
violated the securities laws.”)
The plaintiff has sufficiently alleged for purposes of his
complaint that he subjectively believed that there was a
violation of Section 10(b) and Rule 10b-5 and that there was an
objective basis for that belief based on a theory that Credit
Suisse and others were involved in market manipulation that
benefitted them to the disadvantage of those investors who were
unaware of the alleged scheme. (FAC ¶ 19.) Section 10(b)
prohibits not only material misstatements and omissions, but
also manipulative acts. See ATSI Commc’ns, Inc. v. Shaar Fund,
Ltd., 493 F.3d 87, 99 (2d Cir. 2007); see also Pagel, Inc. v.
SEC, 803 F.2d 942, 946 (8th Cir. 1986). The plaintiff is not
required to prove that a securities law violation had occurred,
but only that he possessed a good faith reasonable belief that
such a violation had occurred and he has crossed that threshold
for purposes of the current motion.
For their second argument, the RSI Defendants contend that
the plaintiff did not submit the information to the SEC in
accordance with the methods of submission outlined in 17 C.F.R.
§ 240.21F-9(a), and therefore does not qualify as a whistleblower
under the definition of 15 U.S.C. § 78u-6(a)(6), which requires
the information related to a securities law violation to be
submitted “in a manner established, by rule or regulation, by
the Commission.” The RSI Defendants argue that the manner
established by the SEC for information submission is contained
in 17 C.F.R. § 240.21F-9(a). That regulation provides for
submission of information online through the Commission’s
website or on a Form TCR (Tip, Complaint, or Referral).
This argument has no merit. The SEC provided the manner in
which information is to be provided in Rule 21F-9 for
whistleblowers who sought to receive an award from the use of
their information. In a recent release, the SEC explained that
“an individual may qualify as a whistleblower for purposes of
Section 21F’s employment retaliation protections irrespective of
whether he or she has adhered to the reporting procedures
specified in Rule 21F-9(a). Rule 21F-2(b)(1) alone governs the
procedures that an individual must follow to qualify as a
whistleblower eligible for Section 21F’s employment retaliation
protections.” Interpretation of the SEC’s Whistleblower Rules
Under Section 21f of the Sec. Exch. Act of 1934, SEC Release No.
75592, 2015 WL 4624264 (F.R.), at *3 (Aug. 4, 2015); see also
Berman v. Neo@Ogilvy LLC, No. 14-4626, 2015 WL 5254916, at *9
(2d Cir. Sept. 10, 2015) (applying the Commission’s
interpretation of the definition of a whistleblower in 15 U.S.C.
The statutory and regulatory scheme is clear and relatively
straightforward as it relates to the argument by the RSI
Defendants. Rule 240.21F-2(b) codifies protection for
whistleblowers against retaliation. As to the procedure for
providing information to the Commission, it refers back to 15
U.S.C. § 78u–6(h)(1)(A), which is the prohibition against
retaliation and that section does not contain any requirement
that any type of reporting be used. Moreover, Rule 240.21F-2(b)
states explicitly: “The anti-retaliation protections apply
whether or not you satisfy the requirements, procedures and
conditions to qualify for an award.” The RSI Defendants attempt
to disqualify the plaintiff from coverage under the antiretaliation protections because he did not file a TCR form, but
that form is only required to obtain an award and is not
required to take advantage of the anti-retaliation protection. 4
The issue in Berman and Asadi v. G.E. Energy (U.S.A.), L.L.C.,
720 F.3d 620, 630 (5th Cir. 2013), on which the RSI Defendants
rely, was a different issue of statutory construction. The issue
was not whether a person reporting a possible securities law
violation to the Commission is required to use any particular
form to report in order to obtain the protection afforded a
The RSI Defendants’ motion to dismiss the Dodd-Frank claim
is therefore denied.
2. Stored Communications Act
The SCA, 18 U.S.C. § 2701 et seq. provides in part:
subsection (c) of this section whoever—
authorization a facility through which an
(2) intentionally exceeds an authorization
to access that facility;
and thereby obtains, alters, or prevents
authorized access to a wire or electronic
communication while it is in electronic
storage in such system shall be punished as
provided in subsection (b) of this section.
18 U.S.C. § 2701. The plaintiff alleges that in October, 2012,
after he was terminated from RSI, he requested access from RSI
to his stored emails. 5 (FAC ¶ 54.) RSI sent the plaintiff those
whistleblower; Rule 240.21F-2(b) makes clear that no such form
is required. The issue was whether a person could be a
whistleblower by reporting a securities law violation in
accordance with the Sarbanes-Oxley Act within a company rather
than to the Commission, despite the fact that 15 U.S.C. § 78u6(a)(6) defines a whistleblower as an individual who provides
information “to the Commission in a manner established, by rule
or regulation, by the Commission.” Contrary to the holding in
Asadi, the Court of Appeals for the Second Circuit deferred to
the Commission’s Rule that found a whistleblower included a
person who made internal reports in accordance with the
Sarbanes-Oxley Act. See Rule 240.21F-2(b)(1); 15 U.S.C. § 78u6(h)(1)(A).
As the plaintiff acknowledged at the oral argument of the
motions, the emails in question are emails sent and received in
emails several weeks later, “tampered with the contents,” and
“locked” the attachments so they could not be accessed. The
plaintiff was able to access the attachments after he
“forensically analyzed” the emails. (Id.)
The plaintiff’s claim fails because it does not allege,
other than in conclusory terms, that the defendants were without
authorization, or exceeded their authorization to access his
emails. Moreover, to the extent that the plaintiff is claiming
that the RSI Defendants tampered with his emails, he has failed
to allege a violation of the SCA.
The plaintiff alleges that RSI “tampered with” the contents
of the emails and locked the attachments before forwarding the
emails to the plaintiff after he was terminated. But these
actions are not proscribed by the SCA. 18 U.S.C. § 2701(a) only
prohibits a person from accessing a facility and altering the
“electronic communication while it is in electronic storage in
such system.” “Electronic storage” is defined in 18 U.S.C.
§ 2510(17)(A)-(B) as ”any temporary, intermediate storage of a
wire or electronic communication incidental to the electronic
transmission thereof” and “any storage of such communication by
an electronic communication service for purposes of backup
protection of such communication.” Because communications
the plaintiff’s work email account and stored on an RSI server
to which the plaintiff no longer has access.
downloaded to a user’s computer terminal are neither stored on a
temporary basis “incident to [their] electronic transmission”
nor stored “by an electronic communication service for purposes
of backup protection of such communication,” the plaintiff’s
allegations that the RSI Defendants tampered with the emails
after they were initially downloaded fails to state a claim. See
Council on Am.-Islamic Relations Action Network, Inc. v.
Gaubatz, 793 F. Supp. 2d 311, 337 (D.D.C. 2011).
It does not appear that the plaintiff is complaining about
the access that the RSI Defendants exercised over his emails
while he was employed at RSI. At the argument of the motions, he
freely acknowledged that the computer and server belonged to RSI
and that RSI had the right to the work product on the computer.
It is also clear that RSI had the right to access his emails and
to review them so that RSI had the right under the statute to
access the emails. FINRA
Rule 3110(b)(4) requires its members
to review “incoming and outgoing written (including electronic)
correspondence to properly identify and handle in accordance
with firm procedures, customer complaints, instructions, funds
and securities, and communications that are of a subject matter
that require review under FINRA rules and federal securities
laws [; and] internal communications to properly identify those
communications that are of a subject matter that require review
under FINRA rules and federal securities laws.” FINRA Manual
Rule 3110, 2014 WL 3929606, at *2. There is no time limit on
reviewing those communications. The plaintiff had no reasonable
expectation of privacy in his work emails that are subject to
the employer’s review and RSI was authorized to access and
obtain those emails. See Pure Power Boot Camp v. Warrior Fitness
Boot Camp, 587 F. Supp. 2d 548, 559-60 (S.D.N.Y. 2008) (Report
and Recommendation adopted by court) (“Courts have routinely
found that employees have no reasonable expectation of privacy
in their workplace computers, where [the employees are informed]
that they will be monitored.”); see also Shefts v. Petrakis, 758
F. Supp. 2d 620, 635 (C.D. Ill. 2010) (finding employer’s access
to employee’s work emails authorized by its manual that states
that emails received on company equipment were subject to
Accordingly, the RSI Defendants’ motion to dismiss the SCA
count against the RSI Defendants is granted. The SCA claim is
3. Americans with Disabilities Act
The RSI Defendants move to dismiss the claims for
violations of the ADA. The only alleged basis for dismissal is
the allegation that the plaintiff failed to exhaust his
administrative remedies by filing a charge with the EEOC and
obtaining a right-to-sue letter.
A timely filing of a charge with the EEOC is a prerequisite
to any Title VII claim filed in federal district court. 42
U.S.C. § 2000e–5(e); Van Zant v. KLM Royal Dutch Airlines, 80
F.3d 708, 712 (2d Cir. 1996). In New York State, the limitations
period for filing such a charge is 300 days from the date of any
act of discrimination or retaliation. See Borrero v. Am. Express
Bank, Ltd., 533 F. Supp. 2d 429, 435 (S.D.N.Y. 2008). “[O]nly
incidents that took place within the timely filing period are
actionable.” Nat’l R.R. Passenger Corp. v. Morgan, 536 U.S. 101,
114 (2002). A federal lawsuit must be brought within 90 days of
the receipt of a right-to-sue letter from the EEOC. 42 U.S.C.
§ 2000e–5(f)(1). Any claim made pursuant to the ADA has the same
requirement and limitations period. 42 U.S.C. § 12117(a); see
also Bennett v. Project Renewal, Inc., No. 14cv2063 (JGK), 2015
WL 1455693, at *2 (S.D.N.Y. Mar. 31, 2015).
An ADA plaintiff’s failure to exhaust administrative
remedies is an affirmative defense. A plaintiff is not required
to plead or demonstrate exhaustion at the pleading stage. See
DiPetto v. U.S. Postal Serv., 383 F. App’x. 102, 104 (2d. Cir.
2010) (summary order).
While the filing of a timely charge of discrimination is a
precondition to filing an ADA claims in federal court, the
exhaustion of administrative remedies is not a jurisdictional
prerequisite to suit. Zipes v. Trans World Airlines, Inc., 455
U.S. 385, 393 (1982). Thus, like a statute of limitations, the
exhaustion requirement “is subject to waiver, estoppel and
equitable tolling.” Id.
The plaintiff makes no allegations regarding his
administrative filing in the complaint. As a result, the
complaint can only be said to be ambiguous about exhaustion. In
response to the RSI Defendants’ motion, the plaintiff claims
that his decision not to file for administrative relief with the
EEOC was due to a conversation with the EEOC. (Pl’s Opp’n at
11.) The relevance of that conversation is unclear. It could be
that the plaintiff is attempting to raise an argument of
equitable estoppel, but that could not be determined on a motion
In the most recent document submitted by the plaintiff in
support of his motion for a preliminary injunction, the
plaintiff includes a document that suggests the plaintiff did
file a charge with the EEOC and received a right-to-sue letter
from the EEOC dated July 23, 2013. (ECF No. 155 at 15.) This
suggests that the plaintiff was not dissuaded from filing a
charge with the EEOC but that he failed to bring the current
action within 90 days of receiving the right-to-sue letter. That
would raise a statute of limitation defense that has not been
raised thus far by the RSI Defendants.
The Court could not dismiss the ADA claims based on a
failure to exhaust administrative remedies because that defense
does not appear on the face of the complaint. However, as the
Court explained to the plaintiff at the argument of the motions,
the papers raise serious questions as to the timeliness of all
of his ADA claims.
The motion by the RSI Defendants to dismiss the ADA claims
against them is denied.
In his Fourth Amended Complaint, the plaintiff’s only
claims under the ADA were based on discrimination in employment
in violation of Title I of the ADA. 6 In his responsive papers on
the motions, the plaintiff attempted to assert claims under
Title II relating to public services and Title III relating to
public accommodations. A plaintiff cannot amend his complaint in
response to a motion to dismiss. See, e.g., Bernstein v. City of
New York, No. 06cv895 (RMB), 2007 WL 1573910, at *10 (S.D.N.Y.
May 24, 2007) (finding in pro se case that “‘[n]ew claims not
specifically asserted in the complaint may not be considered by
courts when deciding a motion to dismiss’” (quoting Lerner v.
Forster, 240 F. Supp. 2d 233, 241 (E.D.N.Y. 2003) (alteration in
In his third cause of action against RSI, the plaintiff cited
42 U.S.C. § 12112 which is the provision in Title I that
prohibits discrimination against a “qualified person with a
disability” by a “covered entity.” (FAC ¶ 107 and corresponding
claim for relief). The plaintiff also cited 29 C.F.R. § 16.30
which is the beginning of the regulations implementing Title I.
original)); see also Mathie v. Goord, 267 F. App’x. 13, 14 (2d.
Cir. 2008) (summary order) (holding new claims presented in
opposition to motion to dismiss could not be considered by
district court). Therefore, these allegations are not part of
the plaintiff’s ADA claims.
Accordingly, the RSI Defendants’ motion to dismiss the ADA
claims is denied, but the ADA claims against the RSI Defendants
are limited to those stated in the FAC.
4. 42 U.S.C. §§ 1985, 1986
Generously construed, the FAC attempts to assert a civil
conspiracy claim under 42 U.S.C. § 1985(3) against the RSI
Defendants, Jane St., and Integral, alleging that the defendants
deprived the plaintiff of equal protection of the laws and of
equal privileges and immunities under the law because of the
defendants’ animus towards persons perceived as mentally
“To state a conspiracy claim under 42 U.S.C. § 1985,
plaintiff must allege (1) some racial or other class-based
discriminatory animus underlying the defendants’ actions, and
(2) that the conspiracy was aimed at interfering with the
plaintiff’s protected rights.” Porter v. Selsky, 287 F. Supp. 2d
180, 187 (W.D.N.Y. 2003), aff’d, 421 F.3d 141 (2d Cir. 2005).
The RSI Defendants argue that this claim should be dismissed
because the plaintiff has failed to plead class-based animus and
the interference with protected rights. As explained below, they
are correct on both issues.
To state a claim under 1985(3), “the intended victims must
be victims not because of any personal malice the conspirators
have toward them, but because of their membership in or
affiliation with a particular class.” United Bhd. of Carpenters
& Joiners of Am., Local 610, AFL-CIO v. Scott, 463 U.S. 825, 850
(1983). Section 1985(3) does not reach conspiracies motivated by
economic or commercial animus. Id. at 838.
The FAC fails to allege that whatever hardship the
plaintiff suffered at RSI was due to his supposed class
membership, in this case his being perceived as mentally
disabled. In fact it pleads to the contrary. The essence of the
complaint was that the plaintiff was the target of retaliation
by his employer, because of his report to the SEC for securities
law violations by an important business relation of his
employer. That he was regarded as mentally disabled, according
to the plaintiff, was precisely the result of the “gaslighting”
campaign that was mounted against the plaintiff because he was a
whistleblower. (FAC ¶ 3.) The Court of Appeals for the Second
Circuit has expressly declined to extend § 1985(3) protections
to whistleblowers as a protected class. See Tavoloni v. Mount
Sinai Med. Ctr., 198 F.3d 235, 1999 WL 972656, at *2 (2d Cir.
Oct. 1, 1999) (summary order).
Moreover, the plaintiff affirmatively pleads that the
reason for the mental abuse against him was to “prevent him from
further reporting details related to the manipulation of
futures-based [ETPs] and ETNs.” (FAC ¶ 111.) That is a financial
motivation rather than a class-based motivation. Conspiracies
with financial or commercial motivation are not covered under
section 1985(3). See United Bhd. of Carpenters, 463 U.S. at 838.
Because the plaintiff has failed to allege any class based
animus by the RSI Defendants and Jane St., he has failed to
state a claim against the RSI Defendants and Jane St. for a
violation of 1985(3).
Furthermore, the plaintiff has failed to identify any
constitutional right that the alleged conspiracy sought to deny
him. A deprivation of a constitutional right is a required
object of a conspiracy under 1985(3). Great Am. Fed. Sav. & Loan
Ass’n v. Novotny, 442 U.S. 366, 372 (1979). The plaintiff admits
that he was not deprived of his First Amendment rights,
notwithstanding his conflicting statements in his opposition
papers. (FAC ¶ 111.) The plaintiff has failed to identify any
other constitutional rights the deprivation of which was the
object of the alleged conspiracy. (FAC ¶¶ 111-113.)
The plaintiff does allege that RSI conspired with Jane St.
and perhaps Integral to interfere with his employment
opportunities at other private employers, and to interfere with
his security clearance to enter the floor of the NYSE. To the
extent that these are intended to be allegations of violations
of the plaintiff’s right under the Fourteenth Amendment, the
plaintiff has failed to state a claim. The Fourteenth Amendment
is a protection against the denial of rights by state actors.
See, e.g., Lugar v. Edmondson Oil Co., 457 U.S. 922, 924 (1982);
Edmond v. Hartford Ins. Co., 27 F. App’x 51, 53 (2d Cir. 2001)
(summary order) (“[A] claim under § 1985(3) for conspiracy to
deny equal protection in violation of the Fourteenth Amendment
is not actionable in the absence of state action”). It is not a
protection against the failure of a private employer to offer
employment. See Zaidi v. Amerada Hess Corp., 723 F. Supp. 2d
506, 518 (E.D.N.Y. 2010) (holding the Equal Protection Clause of
the Fourteenth Amendment cannot provide a vehicle for an
employment discrimination claim where the employer is a private
entity). Nor is the NYSE a state actor when it exercises its
non-regulatory functions, such as setting security clearance to
its trading floors as in this case. See, e.g., United States v.
Solomon, 509 F.2d 863, 871-72 (2d Cir. 1975); O’Callaghan v. New
York Stock Exch., No. 11cv6331 (NRB), 2012 WL 3955968, at *4
(S.D.N.Y. Aug. 15, 2012).
To the extent that the plaintiff is alleging that he was
deprived of employment and public accommodation rights because
he was regarded as being mentally ill, that claim would be a
statutory claim under the ADA that would not suffice for a
1985(3) claim. Cf. Novotny, 442 U.S. at 378 (“[Section] 1985(3)
may not be invoked to redress violations of Title VII.”); Medvey
v. Oxford Health Plans, 313 F. Supp. 2d 94, 100 (D. Conn. 2004)
(section 1985(3) cannot be used to enforce the ADA, among other
Because the plaintiff has failed to allege the class-based
discriminatory animus or a violation of a protected
constitutional right, his § 1985(3) claim must be dismissed. The
plaintiff’s failure to allege an actionable § 1985(3) claim
dooms his claim under § 1986 because § 1986 creates a cause of
action only for “neglect to prevent” conspiracies in violation
of § 1985. Thus, where there is no valid claim under § 1985,
there can be no valid claim under § 1986. See Amaker v. Goord,
No. 98cv3634 (JGK), 1999 WL 511990, at *11 (S.D.N.Y. July 20,
1999) (collecting cases).
Accordingly, the plaintiff’s § 1985(3) and § 1986 claims
5. New York Human Rights Law
The RSI Defendants only seek to dismiss the NYHRL claim on
the ground that the court should decline supplemental
jurisdiction in the event all federal claims against the RSI
Defendants are dismissed. (ECF No. 112 at 9-10.) Because the
Dodd-Frank Anti-Retaliation claim and the ADA claims survive,
the NYHRL claim survives as well. The RSI Defendants’ motion to
dismiss the NYHRL claim is therefore denied.
B. Jane St.
The plaintiff alleges four claims against Jane St. for its
alleged violations of: 1) Title I of the ADA; 2) 42 U.S.C.
§1985(3); 3) 42 U.S.C. §1986; and 4) the NYHRL. For the reasons
explained below, Jane St.’s motion to dismiss these claims is
Jane St. moves to dismiss the § 1985(3) claim because the
plaintiff has failed to plead sufficient facts to show a
plausible claim of conspiracy, a class-based animus, or a
violation of a constitutional right as the object of the alleged
conspiracy. Jane St. is correct on each of these three issues.
The plaintiff’s allegations of a conspiracy are conclusory.
Conclusory allegations are insufficient to plead a conspiracy.
“[A] complaint containing only conclusory, vague, or general
allegations of conspiracy to deprive a person of constitutional
rights cannot withstand a motion to dismiss.” Gyadu v. Hartford
Ins. Co., 197 F.3d 590, 591 (2d Cir. 1999) (per curiam). The
allegation regarding to the forming of this conspiracy is
limited to a purportedly “symbiotic” relation between Jane St.
and RSI and a meeting attended by two Jane St. traders and
several RSI employees. It is not alleged that the plaintiff was
a subject of the discussion at that meeting, and the supposed
wrongful conduct by the two Jane St. traders, namely making
damaging comments about the plaintiff to interfere with his
employment, happened one and a half years after the alleged
meeting. The conspiracy allegation is “vague and implausible,”
Kalderon v. Finkelstein, No. 08cv9440 (RJS), 2010 WL 3359473, at
*3 (S.D.N.Y. Aug. 25, 2010), aff’d, 495 F. App’x 103 (2d Cir.
2012) (summary order), and falls far short of providing “factual
basis supporting a meeting of the minds.” See Romer v.
Morgenthau, 119 F. Supp. 2d 346, 363 (S.D.N.Y. 2000)
(“[P]laintiff must also provide some details of time and place
and the alleged effects of the conspiracy.” (internal citations
and quotations omitted))
Moreover, as explained with respect to the RSI Defendants,
the plaintiff’s failures to allege a class-based animus and a
violation of a constitutional right are fatal to his claims, and
the claims must therefore be dismissed. Because the § 1985(3)
claim is dismissed, the § 1986 claim is also dismissed for the
same reason as explained with regard to the RSI Defendants’
Jane St. also moves to dismiss the ADA claim and the NYHRL
claim on the ground, among others, that the plaintiff does not
and cannot allege that Jane St. was his employer. Title I of the
ADA only applies to discrimination by a “covered entity.” See 42
U.S.C. § 12112(a) (“No covered entity shall discriminate against
a qualified individual on the basis of disability in regard to
job application procedures, the hiring, advancement, or
discharge of employees, employee compensation, job training, and
other terms, conditions, and privileges of employment.”) “The
term ‘covered entity’ means an employer, employment agency,
labor organization, or joint labor-management committee.” 42
U.S.C. § 12111(2). Jane St. did not employ or consider employing
the plaintiff at any point, and the plaintiff does not allege
any other reason why Jane St. is a covered entity under Title I
of the ADA. 7 Therefore the plaintiff cannot assert a claim under
In his FAC at ¶ 109 and the corresponding claim for relief, the
plaintiff cites 42 U.S.C. § 12102(2)(c) in his ADA claims
against Jane St. and Integral. This appears to be a mis-cite for
§ 12102(1)(c) which defines disabilities to include “being
regarded as having such an impairment . . . .” But it is not a
reference to a liability section under Title I, II or III of the
ADA. The plaintiff also cites 29 C.F.R. § 1630.14 which relates
to medical examination by covered entities. That section is
contained in the regulation relating to Title I. See 29 C.F.R.
Title I of the ADA against Jane St. His ADA claim against Jane
St. is dismissed.
In his opposition papers, the plaintiff attempts to assert
Title II and Title III claims against Jane St. As explained
earlier with regard to similar claims asserted against the RSI
Defendants, because these claims were not asserted in the FAC,
and this case has been proceeding for more than a year during
which time four amendments to the complaint have been filed by
the plaintiff, these claims are not properly pleaded.
The NYHRL’s provisions protecting people with disabilities
in the employment context also limit their scope to the
discriminatory practice of a small group of covered entities.
N.Y. Exec. Law § 296(1) (proscribing unlawful discriminatory
practice by an employer, labor organization, employment agency
or any joint labor-management committee controlling apprentice
training programs). The plaintiff has failed to allege why Jane
St. would fall within the scope of the NYHRL’s prohibitions.
The only section of the NYHRL that the plaintiff cites in
support of his claims is N.Y. Exec. L. § 292(21)(c). (FAC
¶ 108.) That is a definitional section that includes within
disability “a condition regarded by others as such an impairment
. . . .” In opposition to the motion to dismiss, the plaintiff
attempts to argue that Jane St. is a place of public
accommodation that would be covered by N.Y. Exec. L. § 296(2).
This is a claim that was not raised in the FAC. Jane St.
disputes that it would be covered by that section and the Court
could not deny the current motion to dismiss based on a new
claim raised for the first time in opposition to the motion.
If the Court is inclined to dismiss this claim, the
plaintiff asks the Court to transfer the claim to a New York
State court pursuant to 28 U.S.C. § 1631. But that section
relates to a transfer to another federal court, not to a state
court. See, e.g., Giusti v. Morgan Stanley Smith Barney, LLC,
581 F. App’x 34, 35 (2d Cir. 2014) (summary order); Escoffier v.
MFY Legal Servs., No. 13cv80898 (LGS), 2015 WL 221048, at *2
(S.D.N.Y. Jan. 15, 2015).
The Court will dismiss the NYHRL claim without prejudice
and decline to exercise supplemental jurisdiction because all of
the federal claims against Jane St. have been dismissed. See 28
U.S.C. § 1367(c). 8
At the argument of the current motions, the plaintiff expressed
his concerns over the statute of limitations for his state law
claims and communicated his desire to pursue those claims in a
proper state tribunal. When a state law claim first asserted
under supplemental jurisdiction is subsequently dismissed by the
court, section 1367(d) provides that, “[t]he period of
limitations for any claim asserted under subsection (a) [shall
be tolled] for a period of 30 days after it is dismissed . . .
.” 28 U.S.C. § 1367(d). The Second Circuit Court of Appeals has
explained that “[s]ection 1367(d) ensures that the plaintiff
whose supplemental state claim is dismissed has at least thirty
days after dismissal to refile in state court.” Seabrook v.
Jacobson, 153 F.3d 70, 72 (2d Cir. 1998) (emphasis added); see
The plaintiff alleges four claims against Integral,
specifying violations of: 1) Title I of the ADA; 2) 42 U.S.C. §
1985(3); 3) 42 U.S.C. § 1986; and 4) the NYHRL. Integral’s
motion to dismiss these claims is granted.
Integral moves to dismiss the ADA claim and the NYHRL claim
on the ground that, among other things, it was not an employer
or a prospective employer of the plaintiff. The plaintiff has
failed to allege any reason why Integral is a covered entity
under Title I of the ADA or the NYHRL anti-discrimination
provisions in the employment context. Similar to his claims
against Jane St., the plaintiff’s ADA and NYHRL claims against
Integral are therefore dismissed, although the NYHRL claim is
dismissed without prejudice.
Integral also moves to dismiss the §§ 1985 and 1986 claims.
It is plain that the plaintiff has failed to plead a plausible
claim of conspiracy, because he has pleaded no facts that
suggest a meeting of the minds. The plaintiff only proffers the
vague and conclusory statement that Integral has a “symbiotic”
relationship with RSI. (FAC ¶¶ 12, 112.) Not a single meeting or
communication between Integral and any other accused conspirator
is alleged. The complaint clearly falls short of the pleading
also Vincent v. The Money Store, 915 F. Supp. 2d 553, 559-60
required for a conspiracy. See Romer, 119 F. Supp. 2d at 363
(“[P]laintiff must provide some details of time and place and
the alleged effects of the conspiracy.” (internal quotation
Integral is also correct that the § 1985(3) claim against
Integral should be dismissed because the plaintiff has failed to
allege a class-based animus. Indeed, the plaintiff admits that
he is “fairly positive that [Integral] was financially
motivated” in committing the alleged wrongful conduct. (FAC
¶ 112) Conspiracies with financial or commercial motivation are
not within the scope of § 1985(3). See United Bhd. of Carpenters
463 U.S. at 838.
Accordingly, the plaintiff’s § 1985(3) claim against
Integral is dismissed. Because the § 1985 claim fails, the §
1986 claim also fails. See Amaker, 1999 WL 511990, at *11. All
claims against Integral are therefore dismissed, although the
NYHRL claim is dismissed without prejudice.
D. Dr. Henricks
The plaintiff asserts two claims against Dr. Henricks,
alleging she violated: 1) 42 U.S.C. § 1986; and 2) N.Y.C.P.L.R.
The plaintiff cites N.Y.C.P.L.R. §214-a in his FAC. (FAC
¶ 114.) That is the statute of limitation section for medical,
As discussed above, the plaintiff has failed to state a
§ 1985(3) claim against any of the defendants. Therefore there
cannot be a §1986 claim. See Amaker, 1999 WL 511990, at *11. The
§ 1986 claim against Dr. Henricks is therefore dismissed.
Having disposed of the plaintiff’s only claim under federal
law, the Court declines to exercise supplemental jurisdiction
over the sole surviving state law claim against Dr. Henricks.
The exercise by a district court of supplemental jurisdiction
over state law claims is governed by 28 U.S.C. § 1367, which
provides in relevant part that:
(c) The district courts may decline to
exercise supplemental jurisdiction over a
claim under subsection (a) if—
(1) the claim raises a novel or complex
issue of State law[, or]
(3) the district court has dismissed all
jurisdiction . . . .
28 U.S.C. § 1367(c). The “decision whether to exercise
[supplemental] jurisdiction after dismissing every claim over
which [a court] had original jurisdiction is purely
discretionary.” Carlsbad Tech., Inc. v. HIF Bio, Inc., 556 U.S.
635, 639 (2009); see Delaney v. Bank of Am. Corp., 766 F.3d 163,
170 (2d Cir. 2014) (per curiam).
dental, or pediatric malpractice. It is plain that the plaintiff
is attempting to assert a claim for medical malpractice.
All federal claims against Dr. Henricks have been
dismissed. 10 Moreover, state courts have particular expertise in
medical malpractice cases. See Flemming v. Velardi, No. 02cv4113
(AKH), 2003 WL 21756108, at *3 (S.D.N.Y. July 30, 2003)
(declining to exercise supplemental jurisdiction on the
plaintiff’s medical malpractice claim). The case is still at a
relatively early stage of litigation and there would be no
benefit to judicial economy should the Court exercise
discretionary jurisdiction over the plaintiff’s state law
malpractice claim. See Loren v. N.Y.C. Dep’t of Educ., No.
13cv7597 (VEC), 2015 WL 3917490, at *9 (S.D.N.Y. June 25, 2015)
(declining to exercise supplemental jurisdiction considering no
discovery had been conducted and no evaluation of the state law
claims had been made). Accordingly the Court declines to
exercise supplemental jurisdiction and the plaintiff’s medical
malpractice claim against Dr. Henricks under state law is
dismissed without prejudice. See also In re Beacon Assocs.
Litig., 745 F. Supp. 2d 386, 435-36 (S.D.N.Y. 2010) (Sand, J.)
(declining to exercise supplemental jurisdiction over state law
The plaintiff, in his opposition papers, attempts to include
Dr. Henricks as a defendant for the § 1985(3) conspiracy. (Pl’s
Opp’n at 42.) Because the plaintiff does not seek relief from
Dr. Henricks under that claim in his FAC, the claim cannot be
considered. Even if the FAC is broadly construed to have raised
that claim, it still fails for the same reasons of failure to
plead facts supporting a conspiracy, and to plead a class-based
animus and a violation of a constitutional right as the object
of the alleged conspiracy.
claims against one defendant while federal claims remain as to
other defendants); Stewart v. John Dempsey Hosp., No. 303cv1703
(WWE), 2004 WL 78145, at *4 (D. Conn. Jan. 9, 2004) (same).
E. Leave to Amend
The defendants urge the Court to dismiss the FAC against
them with prejudice and without leave to amend. The plaintiff
had asked for a conference to file yet another amended
The plaintiff’s request for a conference for permission to
file another amended complaint is denied as moot. At the
argument of the current motions the Court discussed with the
plaintiff the plaintiff’s desire to file a fifth amended
complaint. The Court explained that the request was abusive at
this point because it would moot and render wasteful all the
motions directed against the Fourth Amended Complaint. The Court
also urged the plaintiff to wait for the Court’s decision on
As a result of the current motions, it is clear that the
plaintiff should not be permitted to file an amended complaint
in this Court against Jane St., Integral, and Dr. Henricks. Four
bites at the apple are more than sufficient. Weinstein v.
Appelbaum, 193 F. Supp. 2d 774, 782 (S.D.N.Y. 2002); see also
Armstrong v. McAlpin, 699 F.2d 79, 93–94 (2d Cir. 1983); DeJesus
v. Sears Roebuck & Co., Inc., 87 F.3d 65, 72 (2d Cir. 1996). As
to RSI, the case remains pending in this Court. If the plaintiff
still seeks to file an amended complaint, the plaintiff should
file an appropriate motion.
IV. Plaintiff’s Post-Complaint Motions
On May 11, 2015, the plaintiff moved to strike parts of the
RSI Defendants’ memorandum of law in support of the motion to
dismiss the FAC, on the ground that the defendants’ motion
“fraudulently misrepresent[ed] crucial elements of the
compliant.” (ECF No. 118 at 2.)
Fed. R. Civ. P. 12(f) provides: “the court may strike from
a pleading an insufficient defense or any redundant, immaterial,
impertinent, or scandalous matter.” Fed. R. Civ. P. 12(f).
“Motions to strike are not to be freely granted, and no
deletions will be made unless it is clear that the allegations
are without [basis].” Laub v. Genway Corp., 60 F.R.D. 462, 46566 (S.D.N.Y. 1973) (citations and quotations omitted). Moreover,
the movant should show that he will be prejudiced if the
attacked allegations are left in the pleadings. Allstate Ins.
Co. v. Home Ins. Co., No. 97cv4322 (HB), 1997 WL 639254, at *1
(S.D.N.Y. Oct. 15, 1997).
The RSI Defendants are correct that Rule 12(f) applies only
to pleadings. “[A] motion to dismiss is not a pleading, and
therefore not subject to a Rule 12(f) motion to strike.”
Columbia Cas. Co. v. Neighborhood Risk Mgmt. Corp., No. 14cv0048
(AJN), 2015 WL 3999192, at *5 (S.D.N.Y. June 29, 2015)
(collecting cases). Therefore the motion should be denied on
this ground alone.
Moreover, the plaintiff has failed to show how he is
prejudiced by the defendants’ allegations. The plaintiff plainly
was able to respond to the motion and answer any of the
statements with which he disagreed, so as to cure any confusion
that could be effected by the alleged misstatements. To the
extent there are disputes as to whether the redactions are
proper, the parties should continue to resolve their differences
before the Magistrate Judge who supervised the other redaction
disputes in this case. The motion is denied.
On May, 22, 2015, the plaintiff made a motion for partial
summary judgement. (ECF No. 124.) He later requested in a letter
dated June 9, 2015 to withdraw this motion. (ECF No. 130.) In a
letter dated June 11, 2015 the plaintiff reconfirmed his request
to withdraw his motion for partial summary judgment. (ECF No.
131.) Because the plaintiff has so requested, the motion for
partial summary judgement is denied without prejudice.
In the same letter dated June 11, 2015 (ECF No. 131), the
plaintiff requested the Court to treat his Reply (ECF No. 133),
also filed on June 11, 2015, as a Motion for Partial Judgment on
the Pleadings. Considered as such, the motion is plainly
premature because the defendants have not filed their answers.
Grodzian v. Computer Credit, Inc., No. 08cv2286 (JS)(WDW), 2009
WL 6497843, at *2 (E.D.N.Y. Mar. 31, 2009) (“Plaintiff’s motion
for a judgment on the pleadings is premature because Defendant
has not filed an Answer, and thus the pleadings are not
closed.”) The motion for partial judgement on the pleadings is
therefore denied without prejudice.
On June 18, 2015, the plaintiff filed a motion to strike
various affirmative defenses by Dr. Henricks. (ECF No. 134.)
Because all claims against Dr. Henricks are already dismissed,
this motion is denied as moot.
V. Preliminary Injunction
On September 8, 2015, the plaintiff filed an unsigned order
to show cause for preliminary injunction and temporary
restraining order, seeking to enjoin several defendants 1) to
“economically reinstate” the plaintiff at RSI with full benefits
but for the alleged retaliation, 2) to retract false and
defaming statements about the plaintiff to officers of the NYSE,
3) to retract false and defaming statements made to several
government authorities, 4) to be permanently restrained from
making the aforementioned false and defaming statements to
potential witnesses and individuals employed in the securities
industry, and 5) to cease and desist from retaliating,
misleading, or deceiving, and otherwise deterring employees from
testifying on the plaintiff’s behalf. (ECF No. 138.) Pursuant to
the Court’s order (ECF No. 144), the RSI Defendants filed an
opposition brief on September 18, 2015 (ECF No. 151.) The
plaintiff filed reply papers on September 30, 2015 (ECF No.
As a preliminary matter, given the Court’s ruling on the
relevant motions to dismiss, the plaintiff has no likelihood of
prevailing in this case on the claims against Dr. Henricks, and
any application against Dr. Henricks must therefore be denied.
For the same reason, the plaintiff’s claims against the RSI
Defendants are limited to those arising under the Dodd-Frank
statute, Title I of the ADA, and the NYHRL. 11
Preliminary injunctive relief is designed “to preserve the
status quo and prevent irreparable harm until the court has an
opportunity to rule on the lawsuit's merits.” Devose v.
Herrington, 42 F.3d 470, 471 (8th Cir. 1994) (per curiam).
“Thus, a party moving for a preliminary injunction must
necessarily establish a relationship between the injury claimed
in the party's motion and the conduct asserted in the
complaint.” Id. (citing Penn v. San Juan Hosp., Inc., 528 F.2d
1181, 1185 (10th Cir. 1975)).
The alleged wrongdoing underlying the plaintiff’s surviving
claims deals only with events during his employment at and his
eventual termination by RSI. Claims involving his post-RSI
experiences are dismissed. The plaintiff seeks to enjoin the
relevant RSI Defendants to retract statements made to the NYSE
and several government authorities. These statements appear to
have nothing to do with the plaintiff’s employment at RSI but
Whether to grant or deny a preliminary injunction lies
within the sound discretion of the district court. S.C. Johnson
& Son, Inc. v. Clorox Co., 241 F.3d 232, 237 (2d Cir. 2001). The
standards that govern the issuance of a preliminary injunction
are well established. Ordinarily, a party seeking a preliminary
injunction must show: “(a) that it will likely suffer
irreparable harm in the absence of the injunction[;] and (b)
either (i) a likelihood of success on the merits or (ii)
sufficiently serious questions going to the merits to make them
a fair ground for litigation, with a balance of hardships
tipping decidedly in the movant’s favor.” Tom Doherty Assocs.,
Inc. v. Saban Entm’t, Inc., 60 F.3d 27, 33-34 (2d Cir. 1995).
Where the plaintiff seeks a mandatory injunction—one that
“alter[s] the status quo by commanding some positive act”—an
even higher standard applies. Id. at 33-34. Namely, the
plaintiff must make a “clear” or “substantial” showing of
likelihood of success on the merits or show that “extreme or
very serious damage” would result in the absence of preliminary
relief. Jolly v. Coughlin, 76 F.3d 468, 473 (2d Cir. 1996); Tom
Doherty, 60 F.3d at 33–34; Cherry River Music Co. v. Simitar
only with alleged actions after being terminated by RSI.
Therefore the two applications for injunctions to retract
statements may be denied on this ground alone.
Entm’t Inc., 38 F. Supp. 2d 310, 316 (S.D.N.Y. 1999); see also
Rush v. Fischer, No. 09cv9918 (JGK), 2011 WL 6747392, at *1-2
(S.D.N.Y. Dec. 23, 2011).
Because the plaintiff is proceeding pro se, his submissions
must be “read liberally and should be interpreted ‘to raise the
strongest arguments that they suggest.’” Graham v. Henderson, 89
F.3d 75, 79 (2d Cir. 1996) (quoting Burgos v. Hopkins, 14 F.3d
787, 790 (2d Cir. 1994)); see also Rush, 2011 WL 6747392, at *12.
In this case, the plaintiff seeks an injunction to
“economically reinstate” him, which is essentially a request for
money damages, and to order the several defendants to retract
statements they previously made. The relief sought by the
plaintiff alters the status quo and is properly characterized as
a mandatory rather than a prohibitory injunction. Accordingly,
the plaintiff must meet the more stringent standard, although
the plaintiff has failed to meet even the most basic
requirements to warrant a preliminary injunction.
The plaintiff has made neither a showing of a clear and
substantial likelihood of success on the merits, nor a showing
of extreme and very serious harm that is irreparable. Therefore
the plaintiff’s application for preliminary injunctions is
1. Clear and Substantial Likelihood of Success
The Plaintiff has failed to make a clear and substantial
showing of his likelihood of success on any of his claims.
With regard to the plaintiff’s ADA claim, his own
admissions indicate that the claim is likely time-barred because
he failed to bring his federal complaint within 90 days of
receiving a right-to-sue letter from the EEOC. With regard to
both his ADA and NYHRL claims, the plaintiff has failed thus far
to show that he is likely to succeed on the merits of the claims
because it is apparent that the RSI defendants have substantial
arguments that the plaintiff was dismissed based on his
performance and conduct and not because of any perceived
disabilities. Indeed, the plaintiff argues that the whole
alleged campaign against the plaintiff was to discredit him by
making him appear to be mentally unstable. The plaintiff has not
shown that his discrimination claims are likely to succeed.
Indeed the plaintiff himself “[suspects his] civil claims will
be dismissed” and “intend[s] to hire an attorney and bring a
complaint to state court if necessary.” (ECF No. 138 at 10.)
Therefore by his own admission the plaintiff believes he has
limited likelihood of success on his claims. And at the argument
of the current motions the plaintiff explained that he had
probably brought the wrong motion.
The plaintiff has failed to show a likelihood of success,
much less a clear and substantial likelihood of success on his
claim of Dodd-Frank whistleblower protection. The success of
this claim will depend upon, among other things, proof that the
plaintiff had a reasonable and objective belief that a violation
of the securities law had occurred and that he was discharged or
harassed because he reported that information to the SEC. See 15
U.S.C. § 78u–6(h)(1), 17 C.F.R. § 240.21F–2(b).
The plaintiff has failed to come forward with evidentiary
support to show that he was harassed or discharged for that
reason. See Ivy Mar Co. v. C.R. Seasons Ltd., 907 F. Supp. 547,
561 (E.D.N.Y. 1995) (“[B]are allegations, without more, are
insufficient for the issuance of a preliminary injunction.”);
Hancock v. Essential Res., Inc., 792 F. Supp. 924, 928 (S.D.N.Y.
1992) (“Preliminary injunctive relief cannot rest on mere
hypotheticals.”). The RSI Defendants, through an affidavit by
Rosenblatt, directly dispute any connection between the
plaintiff’s termination and his report to the SEC, and explain
the termination as a result of the plaintiff’s unprofessional
behavior towards Kemmsies. (ECF No. 150 at 2.) They further deny
any interference with the plaintiff’s employment. (Id.) They
also point out that the plaintiff has failed to identify a
single defaming statement supposedly made by any of the RSI
Defendants to the government authorities. These factual disputes
preclude the issuance of a preliminary injunction at this time.
See R.R. P.B.A. of State of N.Y., Inc. v. Metro-N. Commuter
R.R., 699 F. Supp. 40, 43 (S.D.N.Y. 1988) (“[A] substantial
dispute as to the facts may furnish a strong reason to deny
The plaintiff has also failed to show any irreparable harm.
Irreparable harm is “the single most important prerequisite for
the issuance of a preliminary injunction.” Faiveley Transp.
Malmo AB v. Wabtec Corp., 559 F.3d 110, 118 (2d Cir. 2009)
(citations and quotations omitted). Irreparable harm is defined
as “certain and imminent harm for which a monetary award does
not adequately compensate.” Wisdom Import Sales Co., LLC v.
Labatt Brewing Co., Ltd., 339 F.3d 101, 113 (2d Cir. 2003). The
plaintiff must establish that absent a preliminary injunction it
“will suffer an injury that is neither remote nor speculative,
but actual and imminent.” Grand River Enter. Six Nations, Ltd.
v. Pryor, 481 F.3d 60, 66, (2d Cir. 2007) (internal quotation
marks omitted); see also Ben Hur Moving & Storage, Inc. v.
Better Bus. Bureau of Metro. New York, Inc., No. 08cv6572 (JGK),
2008 WL 4702458, at *6 (S.D.N.Y. Oct. 3, 2008). “[M]oney damages
may not form the basis of a claim of irreparable harm necessary
to support a preliminary injunction.” 5124 Drug Corp. v. Human
Res. Admin. of City of N.Y., 539 F. Supp. 1113, 1114-15
The plaintiff has failed to show he would suffer such an
imminent harm if the preliminary injunction were not granted. As
an initial matter, delays in seeking relief undercut an argument
that the plaintiff will suffer irreparable harm. Tough Traveler,
Ltd. v. Outbound Products, 60 F.3d 964, 968 (2d Cir. 1995).
“Preliminary injunctions are generally granted under the theory
that there is an urgent need for speedy action to protect the
plaintiff[‘s] rights. Delay in seeking enforcement of those
rights, however, tends to indicate at least a reduced need for
such drastic, speedy action.” Citibank, N.A. v. Citytrust, 756
F.2d 273, 276 (2d Cir. 1985).
The plaintiff was terminated in October 2012. He filed the
case in June 2014, one and a half years after he was terminated.
The preliminary injunction was brought on September 8, 2015,
almost three years after he parted with RSI and more than one
year after the case was initiated. A delay of this magnitude
substantially undermines a claim of irreparable injury. See
Majorica, S.A. v. R.H. Macy & Co., 762 F.2d 7, 8 (2d Cir. 1985)
(seven months’ delay from the commencement of litigation to the
filing for preliminary injunction may be sufficiently
significant to preclude the granting of preliminary injunctive
While an ongoing violation of constitutional rights may
support a claim of irreparable injury, the plaintiff has failed
to plead any plausible violation of his constitutional rights.
The current motion basically argues that the plaintiff is in
need of funds. But the requisite irreparable harm is not
established by financial distress or inability to find other
employment, unless truly extraordinary circumstances are shown.
See Sampson v. Murray, 415 U.S. 61, 91 (1974).
Extraordinary circumstance may exist where the plaintiff
has shown that he was the victim of retaliation and that
retaliation has prevented him from obtaining additional
employment. See Holt v. Continental Group, Inc., 708 F.2d 87, 91
(2d Cir. 1983). In this case the plaintiff has failed to make an
evidentiary showing that he was the victim of retaliation and
the RSI Defendants have in turn submitted documents in support
of their claim that the plaintiff abused Kemmsies and
subsequently threatened Wishnow. Moreover, the plaintiff
concedes that he does get some other employment. (ECF No. 138 at
Finally, the plaintiff applies to enjoin the RSI Defendants
from witness intimidation. It is true that an alleged
retaliatory discharge “carries with it the distinct risk that
other employees may be deterred from . . . providing testimony
for the plaintiff in [the plaintiff’s] effort to protect [the
plaintiff’s] own rights. These risks may be found to constitute
irreparable injury.” Id. However, there is no presumption of
irreparable injury in such cases; rather the Second Circuit
Court of Appeals has adopted a “case-by-case approach to
requests for preliminary relief based on witness intimidation.”
Moore v. Consol. Edison Co. of N.Y., 409 F.3d 506, 512 (2d Cir.
2005). A preliminary injunction is appropriate when “immediate
relief [is] the only form of relief that could mitigate the
alleged harm of witness intimidation in the ongoing
proceedings.” Id. (emphasis in the original); see also Mullins
v. City of N.Y., 634 F. Supp. 2d 373, 387 (S.D.N.Y. 2009),
aff’d, 626 F.3d 47 (2d Cir. 2010). The plaintiff has not offered
any evidence of witness intimidation, such as a threat of
discharge or even negative performance reviews for testifying in
this case. That the defendants ask their employees not to
discuss a pending litigation can only be described as a
reasonable precaution. No notice of deposition or subpoena has
been filed, and the plaintiff would have opportunities to
receive the information through the discovery process.
Accordingly, because there is no evidence that the defendants
have intimidated any witness from participating in litigation,
the plaintiff has failed to show irreparable harm in this
regard. See also Moore, 409 F.3d at 508. Because the plaintiff
has failed to make a clear and substantial showing of likelihood
of success, and because he has failed to show that irreparable
harm would result in the absence of preliminary relief, the
application for a preliminary injunction is denied.
The Court has considered all of the arguments of the
parties. To the extent not specifically addressed above, the
remaining arguments are either moot or without merit. For the
foregoing reasons, the motions to dismiss by Jane St (ECF No.
105), Integral (ECF No. 108), and Dr. Henricks (ECF No. 113) are
granted. The plaintiff’s claims against these defendants are
dismissed, except that the claim for medical malpractice against
Dr. Henricks, and the NYHRL claims against Jane St. and Integral
are dismissed without prejudice because the Court has declined
to exercise supplemental jurisdiction over those claims.
Pursuant to Fed. R. Civ P. 54(b), there is no just reason for
delay in entering a final judgment dismissing the claims against
Jane St., Integral, and Dr. Henricks, and a final judgment will
be entered accordingly.
The RSI Defendants’ motion to dismiss is granted in part
and denied in part. The motion by the RSI Defendants to dismiss
the Dodd-Frank claim, the claim under Title I of the ADA, and
the claim under NYHRL against the RSI Defendants is denied. The
remaining claims against the RSI Defendants are dismissed.
All pending motions by the plaintiff (ECF No. 118, 124,
133, 134, 135) are denied. The plaintiff’s application for a
preliminary injunction is denied. The foregoing constitutes the
Court’s findings of facts and conclusions of law pursuant to
Fed. R. Civ. P. 52 (a)(2).
The Clerk is directed to close all pending motions, and to
enter a judgment pursuant to Fed. R. Civ. P. 54(b) dismissing
the claims against Jane St., Integral, and Dr. Henricks as
New York, New York
October 7, 2015
John G. Koeltl
United States District Judge
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