Lankau v. Luxoft Holding, Inc. et al

Filing 18

OPINION: Based on the conclusions set forth below, Defendants' motion is granted in part and denied in part. Defendants have moved to dismiss Plaintiff's fraudulent inducement and fraud claims as against both Defendants. Defendants make two arguments: that Plaintiff's fraud claims are duplicative of his breach of contract claim and that the fraud claims are not pled with the requisite particularity. With regard to Plaintiff's fraudulent inducement claim, special damages ha ve been alleged and the allegations of fraud are sufficient, and Defendants' motion as to the First Claim is denied; because Plaintiff's fraud claim damages are identical to those sought in the breach of contract claim, however, Defendants ' motion as to the Second Claim is granted. While a "plaintiff realistically cannot be expected to plead a defendant's actual state of mind," Eaves, 785 F. Supp. 2d at 247 {citation omitted), Plaintiff has sufficiently put forwar d statements, surrounded by additional support allegations, that raise the "strong inference" that Defendants knew they were representing to Plaintiff one set of requirements to acquire Luxoft equity to get him to join when, in fact, the re al requirements were different, 380544 Canada, Inc., 633 F. Supp. 2d at 34. Presumably, discovery will illuminate the knowledge and intent of the officers who dealt with Lankau with respect to the Defendants' current interpretation of the emplo yment contract, discussed below. At this juncture, however, fraudulent intent and scienter have been adequately alleged, though not established. Accordingly, Defendants' motion to dismiss the Complaint's First Claim is denied and the Compl aint's Second Claim is granted. Defendants have moved to dismiss Plaintiff's securities fraud claims brought under the Section 10(b) of the Securities Exchange Act and the rule implementing the statute, SEC Rule lOb-5 as against Luxoft Hold ing. As the Complaint fails to adequately plead the "in connection" requirement in satisfaction of the securities fraud statute, Defendants' motion is granted. In short, under the present allegation, Plaintiff is not a "purchaser0 of Luxoft stock and Defendants' alleged fraudulent statements are not connected to a sale of securities. Accordingly, Defendants' motion to dismiss the Complaint's Third Claim is granted. In support of dismissal, Defendants make three arguments: that Plaintiff has not alleged which portions of the contract his claims are based, that Plaintiff's "at-will employment" status bars the claims, and that Plaintiff has failed to allege damages as a result of his terminatio n on less than ninety days' notice. For the foregoing reasons, Defendants' motion with respect to the Fourth Claim is granted in part and denied in part. Accordingly, Defendants' motion to dismiss as to the portion of Plaintiff's breach of contract claim regarding equity compensation in Luxoft is denied and as to the portion of Plaintiff's breach of contract claim regarding salary adjustments is granted. Accordingly, Defendants' motion to dismiss portions of Plain tiff's breach of contract claim based on alleged promised job responsibilities is granted. Accordingly, Defendants' motion to dismiss portions of Plaintiff's breach of contract claim based on the ninety days' notice for terminatio n is denied. Accordingly, Defendants' motion to dismiss the Complaint's Fifth Claim is granted. For the foregoing reasons, Defendants' motion to dismiss Plaintiff's Complaint is granted in part and denied in part, and as further set forth in this order. (Signed by Judge Robert W. Sweet on 7/7/2017) (ap)