Wexler et al v. Allegion (UK) Limited et al
OPINION AND ORDER: For the foregoing reasons, Defendants' motion to dismiss is GRANTED in part and DENIED in part. Wexler is permitted to proceed on his defamation claim and is granted leave to replead his age discrimination claims. Zero Latina, Zero Asia, and Zero East are granted leave to replead their breach of distributor contract claim. As Plaintiffs voluntarily dismissed their conversion claim, Defendants' motion to dismiss that claim is denied as moot. Plaintiffs' Amended Complaint must be filed, if at all, on or before March 30, 2017. Defendants' response is due April 20, 2017. The parties are directed to appear for a conference on April 21, 2017 at 10:30 a.m. The Clerk of the Court is respectfully directed to terminate the motion, Doc. 18. (Signed by Judge Edgardo Ramos on 3/9/2017) (jwh)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
ELIAS WEXLER, ZERO INTERNATIONAL
REALTY CO., INC., ZERO OHIO, LLC, ZERO
AMERICA LATINA, LTD., ZERO ASIA PACIFIC
LTD., and ZERO EAST, LTD.,
OPINION AND ORDER
16 Civ. 2252 (ER)
- against ALLEGION (UK) LIMITED and SCHLAGE LOCK
Elias Wexler (“Wexler”), Zero International Realty Co., Inc. (“Zero Realty”), Zero Ohio,
LLC (“Zero Ohio”), Zero America Latina, Ltd. (“Zero Latina”), Zero Asia Pacific Ltd. (“Zero
Asia”), and Zero East, Ltd. (“Zero East,” and collectively, “Plaintiffs”) brought this action
against Allegion (UK) Limited (“Allegion UK”) and Schlage Lock Company, LLC (“Schlage,”
and collectively, “Defendants”), alleging a host of state law claims. Now pending before the
Court is Defendants’ motion to dismiss Counts I, II, III, VII, and VIII of the Complaint. For the
reasons discussed below, Defendants’ motion is GRANTED in part and DENIED in part.
Plaintiffs will be given an opportunity to replead.
I. BACKGROUND 1
Wexler is an entrepreneur and engineer who, for thirty-five years, served as the President
and CEO of Zero International, Inc. (“Zero International”), a Bronx company known for
The following facts are drawn from the Complaint and are assumed true for the purposes of deciding Defendants’
creative, effective, and affordable approaches to construction material needs in the acoustical,
fireproofing, and door-hardware fields. Compl. (Doc. 2, Ex. A) ¶ 28. Under Wexler’s
leadership, Zero International expanded its operations from one small factory in the Bronx to an
international company, with four factories in the United States, branches all over the country,
and sales in thirty-five countries around the world. Id. ¶ 31. Wexler is also the sole shareholder
and President of Zero Realty, the majority member and President of Zero Ohio, and the 51%
shareholder and President of each of Zero Latina, Zero Asia, and Zero East. Id. ¶¶ 9–13.
Wexler has been published in many trade magazines and has served as a visiting lecturer
at the Pratt Institute of Design, President of the New York Society of Manufacturing Engineers,
and President of the New York Critical Manufacturing Sector Coordinating Council. Id. ¶¶ 35–
38. He was a member of the Builders Hardware Manufacturers Association, which advises and
writes standards for the American National Standards Institute. Id. ¶ 39.
In 2014, Defendants expressed an interest in acquiring Zero International. Id. ¶ 42. At
all relevant times, Wexler’s primary contact for Defendants was Anshu Mehrotra (“Mehrotra”),
Allegion’s Vice President and General Manager of Commercial Mechanical Business. Id. ¶ 43.
In connection with Defendants’ acquisition of Zero International, Wexler and Mehrotra
discussed Wexler’s desire and expectation to continue working in the industry. Id. ¶ 45. The
two agreed that Wexler would continue to use his extensive expertise to further Defendants’
business interests. Id. Specifically, Mehrotra told Wexler that Defendants would continue to
employ him after the acquisition for a minimum of eighteen months and that Wexler would be
permitted to retain the title of “‘President Emeritus’ of Zero International for life.” Id. ¶ 48.
Wexler and Mehrotra also discussed Wexler’s desire that, following the acquisition,
Defendants continue to use Zero Latina, Zero Asia, and Zero East as Zero International’s
exclusive distributors. Id. ¶ 46. Mehrotra, on behalf of Defendants, agreed that with regard to
these three companies, “nothing would change,” and that they would continue to be the exclusive
distributors in their respective geographic regions for products manufactured and sold by Zero
International. Id. ¶ 47.
On or about February 13, 2015, Mehrotra sent Wexler a formal offer of employment
upon the closing of Defendants’ acquisition of Zero International. Id. ¶ 49. Wexler was offered
to join Defendants as “President Emeritus – Zero Group International” with a base annual salary
of $190,000 plus benefits and other financial incentives. Id. ¶ 50. Wexler’s job responsibilities
were to include: sharing his knowledge of the industry and of Zero International’s products and
applications with Defendants’ team at business meetings and presentations, helping Steelcraft (a
company owned by Allegion) comply with acoustical standards, continuing his efforts to include
Intumescent (a product produced by Zero International) in the Builders Hardware Manufacturers
Association’s standards and the National Fire Protection Association’s certifications, providing
support at Zero International’s Bronx facilities on an as-needed and as-requested basis, and
engaging and building relationships with international customers. Id. ¶ 52. The offer contained
the following provision:
If Allegion involuntarily terminates your employments [sic] without
cause prior to August 31, 2016, Allegion will pay you a lump sum
equal to the total amount of base salary that would have been paid
to you through August 31, 2016 if you had remained employed by
Allegion through that date reduced by any amounts of base salary
paid to you prior to such date. This lump sum payment shall be
made as soon as administratively practicable after your termination
of employment date and in no event later than the end of the month
following the month in which your employment terminates.
Id. ¶ 51. On February 19, 2015, Defendants acquired Zero International pursuant to an Asset
Purchase Agreement (“APA”) executed by Defendants, Wexler, and certain other parties. Id.
Wexler worked for Defendants from approximately April 1, 2015 through September 17,
2015. Id. ¶ 53. As part of his duties and at Defendants’ request, Wexler attended meetings in
New York, throughout the country, and around the world. Id. ¶ 54. Wexler also met regularly
with Defendants’ employees to discuss Zero International’s business and products. Id. ¶ 57.
During the term of his employment, neither Mehrotra nor anyone else on behalf of Defendants
ever complained to Wexler about his work performance, and Defendants never reprimanded or
disciplined Wexler in any way connected with his work. Id. ¶¶ 59–68.
On or about September 17, 2015, Mehrotra traveled to Wexler’s office in the Bronx,
accompanied by the head of human resources and two security guards. Id. ¶ 69. Mehrotra
abruptly told Wexler that “we’re separating” and that he had thirty minutes to pack up his
personal belongings and leave the building. Id. ¶ 70. Wexler was humiliated, and he silently
collected his belongings. Id. ¶ 72. After meeting briefly with a representative of Defendants’
human resources department, Wexler was expelled from the building by two security guards, in
plain sight of his coworkers and colleagues, who stared at him. Id. ¶¶ 72–74. Wexler alleges
that the spectacle gave those who viewed it the false impression that Wexler had engaged in
misconduct and was being terminated for cause. Id. ¶ 75. Later, Wexler discovered that
Defendants had also terminated his wife and son—whom Defendants had also employed after
acquiring Zero International—in a similarly “public and humiliating” fashion. Id. ¶ 79. Wexler
was 65 years old at the time he was fired. Id. ¶ 80.
On or about September 17, 2015, Defendants sent Wexler a letter concerning his
termination. Id. ¶ 81. The letter advised Wexler that he had been terminated as part of a
“reduction in force.” Id. However, Wexler alleges that he was actually terminated because of
his age and his “old-school” business practices. Id. ¶ 2. In the letter, Defendants agreed to pay
Wexler the approximately $175,000 to which he was entitled, pursuant to his offer letter, because
he had been terminated without cause, but only if Wexler first agreed to sign a ten-page contract
that included a general release and other conditions affecting his rights. Id. ¶ 81. Wexler refused
to sign the contract, and Defendants, in turn, did not pay Wexler the $175,000. Id. ¶ 82.
Wexler alleges that Defendants falsely informed prominent members of the acoustical,
fireproofing, and door-hardware industries that Wexler’s work for Defendants had been
unsatisfactory and that Wexler was unworthy of continued employment. Id. ¶ 83. Wexler also
alleges that Defendants informed these industry leaders about the manner of his termination, and
that these individuals interpreted Defendants’ conduct as conveying the fact that Wexler had
engaged in misconduct, was being terminated for cause, and was incompetent, dishonest, and
unworthy of employment. Id. ¶¶ 83–85. Wexler asserts that Defendants’ conduct damaged his
reputation, destroyed his future career prospects, and rendered meaningless the title of “President
Emeritus.” Id. ¶¶ 86–87. Since being terminated, Wexler has been stripped of his membership
on the board of the New York Critical Manufacturing Sector Coordinating Counsel, and can no
longer attend meetings and events for the Builders Hardware Manufacturers Association. Id.
¶¶ 90–91. Defendants also refused to use Zero Latina, Zero Asia, and Zero East as their
exclusive suppliers and distributors for Zero International products. Id. ¶ 95.
On February 29, 2016, Plaintiffs brought this action against Defendants in New York
State Supreme Court, Bronx County, alleging age discrimination in violation of the New York
State Human Rights Law (“NYSHRL”) and the New York City Human Rights Law
(“NYCHRL”); defamation; breach of various contracts, including Wexler’s employment contract
and the oral distributor contracts with Zero Latina, Zero Asia, and Zero East; unjust enrichment;
and conversion. Id. ¶¶ 125–183. Plaintiffs seek damages in excess of $10 million, as well as
certain declaratory and injunctive relief. Id. at 26–27. On March 28, 2016, Defendants removed
the case to this Court on the basis of diversity jurisdiction. Doc. 2. On November 9, 2016, the
Court denied Plaintiffs’ motion to remand the case back to state court. Doc. 36.
Now pending before the Court is Defendants’ motion to dismiss Plaintiffs’ claims for age
discrimination (Counts I and II); defamation (Count III); breach of the distributor contracts with
Zero Latina, Zero Asia, and Zero East (Count VII), and conversion (Count VIII). 2 After
Defendants filed their motion, Plaintiffs voluntarily dismissed their claim for conversion. Doc.
44. Plaintiffs otherwise oppose Defendants’ motion.
II. LEGAL STANDARD
Under Rule 12(b)(6), a complaint may be dismissed for “failure to state a claim upon
which relief can be granted.” Fed. R. Civ. P. 12(b)(6). When ruling on a motion to dismiss
pursuant to Rule 12(b)(6), the Court must accept all factual allegations in the complaint as true
and draw all reasonable inferences in the plaintiff’s favor. Koch v. Christie’s Int’l PLC, 699 F.3d
141, 145 (2d Cir. 2012). However, the Court is not required to credit “mere conclusory
statements” or “[t]hreadbare recitals of the elements of a cause of action.” Ashcroft v. Iqbal, 556
U.S. 662, 678 (2009) (citing Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)). “To survive
a motion to dismiss, a complaint must contain sufficient factual matter . . . to ‘state a claim to
relief that is plausible on its face.’” Id. (quoting Twombly, 550 U.S. at 570). A claim is facially
plausible “when the plaintiff pleads factual content that allows the court to draw the reasonable
inference that the defendant is liable for the misconduct alleged.” Id. (citing Twombly, 550 U.S.
Defendants have not moved to dismiss Plaintiffs’ claims for breach of Wexler’s employment contract (Count IV);
breach of Zero Realty’s cleaning and maintenance services contract (Count V); unjust enrichment (Count VI); and
breach of Zero Ohio’s lease (Count IX).
at 556). If the plaintiff has not “nudged [his] claims across the line from conceivable to
plausible, [the] complaint must be dismissed.” Twombly, 550 U.S. at 570.
A. Age Discrimination
Defendants first seek dismissal of Wexler’s claims for age discrimination. In order to
establish a prima facie case of age discrimination in violation of NYSHRL or NYCHRL, a
plaintiff must show that (1) he was within the protected age group; (2) he was qualified for the
position; (3) he suffered an adverse employment action; and (4) the adverse employment action
occurred under circumstances giving rise to an inference of age discrimination. Stephenson v.
Hotel Emps. & Rest. Emps. Union Local 100 of the AFL-CIO, 6 N.Y.3d 265, 270 (2006); see
also Krebaum v. Capital One, N.A., 138 A.D.3d 528, 528 (1st Dep’t 2016); Melman v.
Montefiore Med. Ctr., 98 A.D.3d 107, 112–14 (1st Dep’t 2012). 3 At the pleading stage,
however, a plaintiff need not plead facts giving plausible support to the “ultimate question” of
whether an adverse action was attributable to discrimination; rather, the facts need only give
plausible support to a “minimal inference” of discriminatory motivation. Littlejohn v. City of
New York, 795 F.3d 297, 311 (2d Cir. 2015). The Second Circuit has clarified that “the inference
of discriminatory intent supported by the pleaded facts [need not] be the most plausible
explanation of the defendant’s conduct. It is sufficient if the inference of discriminatory intent is
plausible.” Doe v. Columbia Univ., 831 F.3d 46, 57 (2d Cir. 2016) (emphasis in original); see
also Dawson v. N.Y.C. Transit Auth., 624 F. App’x 763, 770 (2d Cir. 2015) (summary order)
Once a plaintiff establishes a prima facie case, the burden then shifts to the defendant to articulate a legitimate,
nondiscriminatory reason for its actions. Stephenson, 6 N.Y.3d at 270–71. After the defendant has done so, the
burden shifts back to the plaintiff to demonstrate that the articulated reason is pretextual. Id. at 271.
(“At the pleading stage, district courts would do well to remember this exceedingly low burden
that discrimination plaintiffs face . . . .”).
Notwithstanding his exceedingly low burden, the Court finds that Wexler has not
sufficiently alleged an age discrimination claim. Wexler’s claim is supported by a single factual
allegation—that he “was 65 years old when Defendants terminated him.” Compl. ¶ 80. That
fact alone is plainly insufficient to give rise to a minimal plausible inference of age
discrimination. See, e.g., Castagna v. Luceno, No. 09 Civ. 9332 (CS), 2011 WL 1584593, at *11
(S.D.N.Y. Apr. 26, 2011) (dismissing age discrimination claim where plaintiff’s only allegation
“even potentially related to the age discrimination claim [was] that [plaintiff] ‘was born in
1949,’” as “[s]uch an allegation cannot possibly support a claim for age discrimination”).
Wexler also alleges that Defendants “terminated him . . . because of his age and his ‘oldschool’ business practices.” Compl. ¶ 2. Because Wexler does not attribute the phrase, “oldschool,” to any particular speaker, however, his allegation is entirely conclusory. “Although for
the purposes of a motion to dismiss we must take all of the factual allegations in the complaint as
true, we ‘are not bound to accept as true a legal conclusion couched as a factual allegation.’”
Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 555).
Wexler asserts that he unintentionally omitted to attach the phrase, “old-school,” to a
speaker, and states that he can supplement his allegations to include “the circumstances
surrounding Defendants’ unlawful ageist remarks to him” and “actions that were taken against
him but none of his younger colleagues during the brief time that he was employed by
Defendants.” Pl.’s Opp’n Mem. (Doc. 42) at 15. Because Wexler may be able to supplement his
allegations to raise a plausible inference that his termination was due to age discrimination,
Wexler will have an opportunity to replead these claims.
Defendants next seek dismissal of Wexler’s defamation claim. Wexler claims that
Defendants defamed him in two respects. First, Wexler alleges that the manner in which he was
terminated—i.e., escorted by two security guards through and out of the building—gave those
who viewed the spectacle, as well as industry leaders in the acoustical, fireproofing, and doorhardware fields who learned about it, the false impression that he had engaged in misconduct and
was being terminated for cause. Compl. ¶¶ 75–76, 84–85. Second, Wexler alleges that, in
addition to informing them about the manner of his termination, Defendants falsely informed
industry leaders that his work had been unsatisfactory and that he was unworthy of continued
employment. Id. ¶ 83.
1. Manner of Termination
Defendants first argue that the way in which they terminated Wexler cannot serve as the
basis of a defamation claim, because non-verbal conduct cannot constitute a defamatory
statement as a matter of New York law. Defs.’ Mem. (Doc. 19) at 10–13; Defs.’ Reply Mem.
(Doc. 45) at 3–5 & n.2. Defendants are correct. In order to state a claim for defamation in New
York, a plaintiff must first and foremost “identify the allegedly defamatory words that were
uttered.” Ello v. Singh, 531 F. Supp. 2d 552, 580 (S.D.N.Y. 2007) (emphasis added); see also
Contes v. City of New York, No. 99 Civ. 1597 (SAS), 1999 WL 500140, at *9 (S.D.N.Y. July 14,
1999) (dismissing defamation claim based on defendant’s conduct in suspending plaintiff
because “slander requires the making of an oral or written defamatory statement”); Bourquin v.
Brink’s Inc., No. 97 Civ. 7522 (LBS), 1999 WL 108766, at *4 (S.D.N.Y. Mar. 3, 1999)
(dismissing defamation claim based on defendant’s conduct because “New York courts do not
allow recovery for defamatory conduct”). The cases to which Wexler cites in support of his
argument are all inapposite, as none of them apply New York law. See Pl.’s Opp’n Mem. at 16–
19; see also Dave Kluft, Note, Beyond Words: The Potential Expansion of Defamation by
Conduct in Massachusetts, 83 B.U. L. Rev. 619, 629, 639 n.167 (2003) (noting that “New York
is particularly conservative in the area of defamation by conduct,” being one of the few states
that “explicitly rejects” the theory). Wexler may not, therefore, proceed on a defamation claim
based on the manner of his termination.
2. Statements to Industry Leaders
Defendants deny making the alleged statements to industry leaders about Wexler, but
they nonetheless argue that those statements cannot serve as the basis of a defamation claim,
since they are non-actionable opinions. Defs.’ Mem. at 13, 15–17. Under New York law,
expressions of pure opinion, as opposed to statements of fact, are not actionable and receive full
constitutional protection. Davis v. Boeheim, 24 N.Y.3d 262, 268–69 (2014). “[W]hether a
statement is opinion or rhetorical hyperbole as opposed to a factual representation is a question
of law for the court.” Mr. Chow of N.Y. v. Ste. Jour Azur S.A., 759 F.2d 219, 224 (2d Cir. 1985);
see also Levin v. McPhee, 119 F.3d 189, 196 (2d Cir. 1997) (same). The following three factors
are generally considered by New York courts to determine whether a statement is actionable fact
or non-actionable opinion:
(1) whether the specific language in issue has a precise meaning
which is readily understood; (2) whether the statements are capable
of being proven true or false; and (3) whether either the full context
of the communication in which the statement appears or the broader
social context and surrounding circumstances are such as to
signal . . . readers or listeners that what is being read or heard is
likely to be opinion, not fact.
Davis v. Boeheim, 24 N.Y.3d at 270. The third factor “requires that the court consider the
content of the communication as a whole, its tone and apparent purpose.” Id.; see also Levin,
119 F.3d at 197 (“Instead of parsing out and evaluating the challenged statements in isolation,
New York courts look to the immediate context and the broader social context of the statement
and evaluate the impact that the statements would have on a reasonable reader.”) (citations
omitted). At bottom, the inquiry is whether a reasonable listener would have understood the
challenged statements to be conveying facts about the plaintiff. Davis v. Boeheim, 24 N.Y.3d at
Defendants characterize their alleged statements to industry leaders as those of an
employer regarding an employee’s work performance, which are typically found to be statements
of opinion under New York law. Defs.’ Mem. at 16–17; see, e.g., Protic v. Dengler, 46 F. Supp.
2d 277, 280–81 (S.D.N.Y. 1999) (defendant’s comments to other prospective employers that
plaintiff’s work performance was “unsatisfactory” and that plaintiff was “not competent” were
“clearly” statements of opinion), aff’d, 205 F.3d 1324 (2d Cir. 1999); Varughese v. Mt. Sinai
Med. Ctr., 12 Civ. 8812 (CM), 2015 WL 1499618, at *74 (S.D.N.Y. 2015) (defendant’s
characterizations of plaintiff’s work as “unsatisfactory,” “unprofessional,” and “substandard”
were matters of opinion, not actionable assertions of fact); Doe v. White Plains Hosp. Med. Ctr.,
No. 10 Civ. 5405 (GBD), 2011 WL 2899174, at *3 (S.D.N.Y. July 8, 2011) (“New York courts
have consistently held that subjective job evaluations, including those in connection with an
employee’s termination, are non-actionable opinion.”), aff’d sub nom. Doe v. French, 458 F.
App’x 21 (2d Cir. 2012) (summary order).
Even when the alleged defamatory statement was made by an employer about his
employee, however, the Court must still consider the context of the communication to determine
whether it constitutes opinion or fact. See, e.g., Davis v. Ross, 754 F.2d 80, 86 (2d Cir. 1985)
(finding that a letter written and disseminated by the plaintiff’s former employer, when read in
context, could not be construed as a “mere expression of her opinion”). 4 Here, the context of
Defendants’ statements are not entirely clear from the allegations in the Complaint. Wexler does
not indicate whether he attempted to seek employment with the industry leaders Defendants
allegedly spoke with or whether those individuals contacted Defendants to inquire about his
performance as an employee. Moreover, according to Wexler, Defendants did not merely
provide those individuals with an evaluation of his work performance—they also communicated
the fact that he had been escorted by two security guards through and out of the building upon
his termination. Compl. ¶ 83. Based on the current record, the Court cannot say as a matter of
law whether a reasonable listener would have understood Defendants’ statements to be
conveying opinions or facts.
Regardless of whether Defendants’ comments to industry leaders are deemed to be
statements of opinion or assertions of fact, however, they may be actionable, and dismissal at this
stage is thus improper. First, Defendants’ statements to industry leaders could be actionable as
assertions of fact. To state a claim for defamation under New York law, a plaintiff must allege
(1) a false statement about him, (2) published without privilege or authorization to a third party,
(3) through fault as judged by at minimum a negligence standard, (4) that either causes him
special harm or constitutes defamation per se. Peters v. Baldwin Union Free Sch. Dist., 320 F.3d
In Davis v. Ross, the plaintiff alleged that at all times before she voluntarily resigned, she performed her services
for the defendant in a professional and competent manner. 754 F.2d at 81. The plaintiff never attempted to use the
defendant as a reference for new employment, nor had anyone solicited information from the defendant regarding
the plaintiff’s professional competence. Id. at 82. However, one year after the plaintiff’s resignation, the defendant
disseminated a letter stating that the plaintiff was no longer in her employment, adding: “If I let an employee go, it’s
because either their work or their personal habits are not acceptable to me. I do not recommend these people. In
fact, if you hear from these people, and they use my name as a reference, I wish to be contacted.” Id. at 81–82. The
court noted that if the defendant’s letter were mere opinion, she would have had no reason to send it to persons who
never solicited any information regarding the plaintiff. Id. at 86. Moreover, the court explained, “even if the first
part of the letter merely expresses [defendant’s] opinion, the subsequent statement, ‘I do not recommend these
people,’ tends to objectify the evaluation and implies that others would also find [plaintiff’s] work or personal habits
164, 169 (2d Cir. 2003) (quoting Dillon v. City of New York, 261 A.D.2d 34, 38 (1st Dep’t
1999)). Wexler sufficiently alleges all four elements, as he pleads that (1) Defendants’
statements that his work was “unsatisfactory” and that he was “unworthy of continued
employment” were false, (2) Defendants made these statements to third-party industry leaders,
(3) Defendants had never complained about Wexler’s work performance before and sent him a
letter stating that he had been terminated as part of a “reduction in force,” and (4) the statements
injured his business reputation and future career prospects. 5
Alternatively, Defendants’ statements to industry leaders could be actionable as opinions.
A statement of opinion which implies that it is based on facts that support the opinion, which are
unknown to persons reading or hearing it, is an actionable “mixed opinion.” Chau v. Lewis, 771
F.3d 118, 129 (2d Cir. 2014); Davis v. Boeheim, 24 N.Y.3d at 269. Assuming as true the
allegation that Defendants also communicated to industry leaders the manner of Wexler’s
termination, a reasonable listener could conclude that Defendants’ assessment of Wexler as an
employee was based on undisclosed defamatory facts about Wexler, such as misconduct or
Furthermore, opinions based on false facts are actionable against a defendant who had
knowledge of the falsity or probable falsity of the underlying facts. DiFolco v. MSNBC Cable
L.L.C., 622 F.3d 104, 114 (2d Cir. 2010) (quoting Davis v. Ross, 754 F.2d at 86). Wexler alleges
Because Wexler will be permitted to proceed with his defamation claim, the Court need not decide at this stage
whether Wexler may also be able to sustain a “defamation by implication” claim based on Defendants’
communication to industry leaders of the true fact that Wexler was escorted from the building by security guards
upon his termination. See Herbert v. Lando, 781 F.2d 298, 307 (2d Cir. 1986) (providing that a defamatory
implication might be actionable where “a combination of individual statements which in themselves may not be
defamatory might lead the reader to draw an inference that is damaging to the plaintiff”); Stepanov v. Dow Jones &
Co., 120 A.D.3d 28, 37–38 (1st Dep’t 2014) (“To survive a motion to dismiss a claim for defamation by implication
where the factual statements at issue are substantially true, the plaintiff must make a rigorous showing that the
language of the communication as a whole can be reasonably read both to impart a defamatory inference and to
affirmatively suggest that the author intended or endorsed that inference.”).
that he performed his job duties satisfactorily and that Defendants never complained about his
work performance. Compl. ¶¶ 58–68. Moreover, Wexler alleges that Defendants sent him a
letter acknowledging that he had been fired without cause as part of a “reduction in force.” Id.
¶ 81. Because Defendants’ alleged statements that Wexler’s work had been “unsatisfactory” and
that Wexler was “unworthy of continued employment” may be found to be based on false facts
within Defendants’ knowledge, the statements may be actionable even if they were merely
expressions of opinion.
Finally, Defendants argue that Wexler fails to plead sufficient factual details supporting
his defamation claim, including facts that identify the purported statement and indicate who
made the statement, when it was made, and to whom it was made. Defs.’ Mem. at 13–15; see
Thai v. Cayre Grp., Ltd., 726 F. Supp. 2d 323, 329 (S.D.N.Y. 2010). Wexler has identified the
substance of the statements, however, and has indicated in a general fashion who made them
(individuals working for Defendants), when they were made (following Wexler’s termination in
September 2015), and to whom they were made (industry leaders). The Court finds that Wexler
has thus sufficiently given Defendants notice of the communications complained of to enable
them to defend themselves. See Ello, 531 F. Supp. 2d at 575–76 (“While the defamation need
not be plead in haec verba, a pleading is only sufficient if it adequately identifies the purported
communication, and an indication of who made the statement, when it was made, and to whom it
was communicated. The central concern is that the complaint afford defendant sufficient notice
of the communications complained of to enable him to defend himself.”) (citations and internal
quotation marks omitted).
C. Breach of the Distributor Contracts
Defendants also seek dismissal of Plaintiffs’ breach of contract claim with respect to the
alleged distributor contract that Defendants entered into with Zero Latina, Zero Asia, and Zero
East, in part on the basis that Plaintiffs have failed to sufficiently allege such a claim. In order to
assert a claim for breach of contract in New York, a party must adequately plead (1) the
existence of a contract, (2) its own adequate performance of the contract, (3) breach by the other
party, and (4) damages suffered as a result of the breach. See, e.g., First Investors Corp. v.
Liberty Mut. Ins. Co., 152 F.3d 162, 168 (2d Cir. 1998).
Here, Plaintiffs allege that “[i]n tandem with Defendants’ acquisition of Zero
International,” Wexler and Mehrotra “discussed the status of Zero Latina, Zero Asia and Zero
East as Zero International’s exclusive distributors.” Compl. ¶¶ 45–46. According to Plaintiffs,
“Wexler specifically told Mehrotra that, after Defendants’ anticipated acquisition of Zero
International, he wanted Defendants to continue using these overseas companies as Zero
International’s exclusive distributors in their respective geographic regions,” and that “Mehrotra,
on behalf of Defendants, agreed that with regard to Zero Latina, Zero Asia and Zero East,
‘nothing would change,’” meaning “they would continue to be the exclusive distributors (in their
respective geographic regions) for products manufactured and sold by Zero International.” Id.
¶¶ 46–47. Plaintiffs allege that Defendants breached their contractual obligation by refusing to
use Zero Latina, Zero Asia and Zero East as their exclusive suppliers and distributors for Zero
International products, and instead selling Zero International products on their own in these
markets. Id. ¶ 95. As a result of Defendants’ breach, Plaintiffs allege that Zero Latina has
suffered $100,000 in damages annually, Zero Asia has suffered $500,000 in damages annually,
and Zero East has suffered $500,000 in damages annually. Id. ¶¶ 96–98.
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