Melendez v. The New York Foundling, Inc.
Filing
36
OPINION & ORDER re: 30 FIRST MOTION to Dismiss Amended Complaint. filed by The New York Foundling, Inc. Defendant's Motion To Dismiss is granted in part and denied in part. Plaintiff's ERISA claim is dismissed without preju dice. If Plaintiff wishes to file a second amended complaint, Plaintiff must do so within 30 days of the date of this Opinion. Any newly filed complaint will replace, not supplement, the instant Amended Complaint, and must contain all of the claim s, exhibits, and factual allegations Plaintiff wishes the Court to consider, as well as all changes to correct the deficiencies identified in this Opinion. If Plaintiff fails to abide by the 30-day deadline, his claims may be dismissed with prejudice. The Clerk is respectfully directed to terminate the pending Motion. (Dkt. No. 30.) SO ORDERED. (Signed by Judge Kenneth M. Karas on 3/6/19) (yv)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
LORENZO MELENDEZ,
Plaintiff,
v.
No. 17-CV-6162 (KMK)
OPINION & ORDER
THE NEW YORK FOUNDLING, INC.,
Defendant.
Appearances:
Michael B. Ranis, Esq.
Foulke Law Firm
Goshen, NY
Counsel for Plaintiff
Joseph B. Cartafalsa, Esq.
Ogletree Deakins
New York, NY
Counsel for Defendant
Andrew C. Karter, Esq.
Putney, Twombly, Hall & Hirson LLP
New York, NY
Counsel for Defendant
KENNETH M. KARAS, United States District Judge:
Lorenzo Melendez (“Plaintiff”) brings this Action against The New York Foundling, Inc.
(“Defendant”), alleging that Defendant terminated Plaintiff’s employment on the basis of gender,
in violation of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq.; that Defendant terminated
Plaintiff’s employment because of his numerous complaints about Defendant’s health and safety
problems, in violation of the New York Whistleblower Act, N.Y. Labor Law § 740; and that
Defendant denied Plaintiff severance pay to which he was entitled, in violation of the Employee
Retirement and Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 et seq. Before the Court is
Defendant’s Motion To Dismiss (the “Motion”). (Dkt. No. 30.)
For the following reasons, the Motion is granted in part and denied in part.
I. Background
A. Factual Background
The following facts are drawn from Plaintiff’s Amended Complaint, (Am Compl. (Dkt.
No. 16)), and are taken as true for the purpose of resolving the instant Motion.
Defendant is a New York corporation that, among other ventures, operates group homes
in New York, Rockland, Orange, and Westchester counties that house, service, and treat adults
with developmental disabilities. (Am. Compl. ¶ 4.) In November 2001, Plaintiff was hired as a
residential director of Defendant’s Residential Treatment Center in Rockland County. (Id. ¶ 6.)
Over the following decade, Plaintiff received several “promotions and title changes,” (id.), and in
2013, Plaintiff became an Assistant Vice President. (Id. ¶ 14.) Plaintiff was thereafter selected
to oversee the opening of four new group home facilities in Staten Island. (Id. ¶ 16.) In
February 2014, Plaintiff’s performance evaluation was strong, resulting in an “exceeds” or
“meets” expectations rating in all categories. (Id. ¶ 15.)
In late 2014, Plaintiff sustained a broken leg while at work and was absent for
approximately three months, returning in February 2015. (Id. ¶ 19.) Upon his return, Plaintiff
noticed problems relating to the lack of safety and training at the Staten Island group homes for
which he was responsible and began to document them. (Id.) Plaintiff reported such problems to
Jill Gentile (“Gentile”), a Senior Vice President with Defendant, repeatedly requested additional
resources to better train staff, and stated that the high staff turnover rate was creating safety and
quality problems for the facilities’ residents. (Id. ¶ 18–20.) No action was taken in response to
Plaintiff’s complaints and requests. (Id. ¶ 20.)
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In August and October 2015, the New York State Office for People with Developmental
Disabilities (the “Office”) conducted audits of the Staten Island group homes and found serious
safety deficiencies at two locations. (Id.) The Office issued two “45-day Statements of
Deficiency” that described “systemic deficiencies in protective oversight, incident management,
and staffing training, amongst other areas of non-compliance and imminent danger to the
residents.” (Id.)
An executive director employed by Defendant asked Plaintiff for a written explanation of
the cause of the problems. (Id.) Plaintiff submitted the requested information. (Id.) Defendant
then transferred Plaintiff away from Staten Island and reassigned him to work primarily in
Rockland and Orange Counties. (Id. ¶ 21.) However, Defendant did not communicate to
Plaintiff that the transfer and reassignment were for disciplinary or performance reasons. (Id.)
Further, in August 2016, Defendant reassigned a program manager who had worked under
Plaintiff in Rockland and Orange Counties to another facility, leaving Plaintiff “without the
traditional support and . . . staffing that typically had existed.” (Id. ¶ 23.) The program manager
was reassigned to work with a female Assistant Vice President. (Id. ¶¶ 23, 26.)
In September 2016, Defendant received a third 45-day Statement of Deficiency from the
Office for a facility under Plaintiff’s management. (Id. ¶ 24.) Upon receipt of the Statement,
Plaintiff conducted an investigation as required by state regulations, (id. ¶ 28), and concluded
that the facility’s residence manager, who was later fired, (id. ¶ 29), “had likely falsified records
certifying that residents had received healthy and appropriate meals,” (id. ¶ 28). Plaintiff
reported his findings to Defendant’s human resources department on November 18, 2016. (Id.)
Three days later, on November 21, 2016, Gentile terminated Plaintiff’s employment with
Defendant via written memorandum, citing the three 45-day Statements of Deficiency and the
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alleged demotion to Rockland and Orange Counties. (Id. ¶ 24.) Plaintiff alleges that these
reasons were pretextual and that his termination was in fact due, at least in part, to gender
discrimination. (Id. ¶¶ 25, 30–31.) According to Plaintiff: (1) three other similarly-situated
Assistant Vice Presidents, all women, received numerous 45-day Statements of Deficiencies
between 2013 and 2016, yet were not fired, (id. ¶¶ 33–34); (2) Plaintiff’s replacement as
Assistant Vice President was a woman, (id. ¶ 32); (3) the program manager who had been
transferred away from him in 2016 was transferred to support a woman, (id. ¶¶ 23, 26); and
(4) Plaintiff had not received a negative performance review or been otherwise disciplined, (id.
¶ 30).
Further, Plaintiff alleges that his termination was, in part, a form of retaliation for
Plaintiff’s complaints relating to Defendant’s failure to provide necessary training, resources,
and supplies at certain facilities, Plaintiff’s his whistleblowing regarding Defendant’s
employee’s falsification of records. (Id. ¶¶ 35–38, 47–50.)
Finally, Plaintiff alleges that, after being terminated, Defendant refused to pay Plaintiff
severance pay due to him under its published severance plan. (Id. ¶¶ 39–46.)
B. Procedural Background
Plaintiff filed his initial Complaint on August 15, 2017. (Dkt. No. 1.) On November 29,
2017, Plaintiff filed the instant Amended Complaint. (Dkt. No. 16.) On December 19, 2017,
Defendant filed a pre-motion letter indicating the grounds on which it anticipated moving to
dismiss. (Dkt. No. 19.) Plaintiff filed a responsive letter on December 26, 2017. (Dkt. No. 20.)
Following a conference held February 7, 2018, the Court adopted a briefing schedule. (Dkt. No.
22.) Defendant filed the instant Motion To Dismiss and accompanying papers on May 14, 2018.
(Not. of Mot. (Dkt. No. 30); Mem. of Law in Supp. of Mot. (“Def.’s Mem.”) (Dkt. No. 31).) On
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June 15, 2018, Plaintiff filed a memorandum in opposition. (Mem. of Law in Opp’n to Mot.
(“Pl.’s Mem.”) (Dkt. No. 33).) Defendant filed a reply on July 6, 2018. (Reply Mem. of Law in
Supp. of Mot. (“Def.’s Reply”) (Dkt. No. 34); Aff. of Joseph B. Cartafalsa, Esq. in Supp. of Mot.
(Dkt. No. 35).)
II. Discussion
Defendant moves to dismiss the Amended Complaint pursuant to Federal Rule of Civil
Procedure 12(b)(6) on grounds (1) that the New York Whistleblower Act’s waiver provision
precludes Plaintiff’s Title VII claim; (2) that Plaintiff fails to allege sufficient facts showing that
Defendant’s severance plan is covered by ERISA; and (3) that, because both federal claims must
be dismissed, the Court should decline to exercise supplemental jurisdiction over Plaintiff’s New
York Whistleblower Act claim. (Def.’s Mem. 2–3.) The Court addresses each in turn.
A. Standard of Review
The Supreme Court has held that, while a complaint “does not need detailed factual
allegations” to survive a motion to dismiss, “a plaintiff’s obligation to provide the grounds of his
entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the
elements of a cause of action will not do.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007)
(citations, quotation marks, and alterations omitted). Indeed, Rule 8 of the Federal Rules of Civil
Procedure “demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation.”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). “Nor does a complaint suffice if it tenders naked
assertions devoid of further factual enhancement.” Id. (quotation marks and alteration omitted).
Rather, a complaint’s “[f]actual allegations must be enough to raise a right to relief above the
speculative level.” Twombly, 550 U.S. at 555. Although “once a claim has been stated
adequately, it may be supported by showing any set of facts consistent with the allegations in the
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complaint,” id. at 563, and a plaintiff need allege “only enough facts to state a claim to relief that
is plausible on its face,” id. at 570, if a plaintiff has not “nudged [his or her] claim[] across the
line from conceivable to plausible, the[] complaint must be dismissed,” id.; see also Iqbal, 556
U.S. at 679 (“Determining whether a complaint states a plausible claim for relief will . . . be a
context-specific task that requires the reviewing court to draw on its judicial experience and
common sense. But where the well-pleaded facts do not permit the court to infer more than the
mere possibility of misconduct, the complaint has alleged — but it has not ‘show[n]’ — ‘that the
pleader is entitled to relief.’” (citation omitted) (second alteration in original) (quoting Fed. R.
Civ. P. 8(a)(2))); id. at 678–79 (“Rule 8 marks a notable and generous departure from the
hypertechnical, code-pleading regime of a prior era, but it does not unlock the doors of discovery
for a plaintiff armed with nothing more than conclusions.”).
In considering a motion to dismiss, the Court “must accept as true all of the factual
allegations contained in the complaint.” Erickson v. Pardus, 551 U.S. 89, 94 (2007) (per
curiam); see also Nielsen v. Rabin, 746 F.3d 58, 62 (2d Cir. 2014) (“In addressing the sufficiency
of a complaint we accept as true all factual allegations . . . . ” (quotation marks omitted)).
Further, “[f]or the purpose of resolving [a] motion to dismiss, the Court . . . draw[s] all
reasonable inferences in favor of the plaintiff.” Daniel v. T & M Prot. Res., Inc., 992 F. Supp. 2d
302, 304 n.1 (S.D.N.Y. 2014) (citing Koch v. Christie’s Int’l PLC, 699 F.3d 141, 145 (2d Cir.
2012)).
B. Analysis
1. Waiver of Title VII Claim
The New York Whistleblower Act bars employers from taking “any retaliatory personnel
action against an employee” who “discloses . . . to a supervisor . . . an activity, policy or practice
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of the employer that is in violation of law, rule or regulation which violation creates and presents
a substantial and specific danger to the public health or safety, or which constitutes health care
fraud.” N.Y. Labor Law § 740(2)(a). Employees may seek judicial relief against employers that
violate this statute. Id. §§ 740(4)(a), (5). However, under the Act’s waiver provision, “the
institution of an action in accordance with [§ 740] shall be deemed a waiver of the rights and
remedies available under any other contract, collective bargaining agreement, law, rule or
regulation or under the common law.” Id. § 740(7).
The scope of the Act’s waiver provision “has not been definitively decided by either the
Second Circuit or the New York Court of Appeals.” Barker v. Peconic Landing at Southold,
Inc., 885 F. Supp. 2d 564, 568 (E.D.N.Y. 2012); see also Reddington v. Staten Island Univ.
Hosp., 511 F.3d 126, 134 (2d Cir. 2007) (noting that “courts have adopted differing and
sometimes contradictory limiting constructions of this waiver” (citations omitted)). Courts
interpreting the waiver provision “have effectively sorted into two camps.” Harisch v. Goldberg,
No. 14-CV-9503, 2016 WL 1181711, at *11 (S.D.N.Y. Mar. 25, 2016). Under the broad
interpretation of the provision, “the waiver applies to claims that relate to the same retaliatory
action on which the [§] 740 claim is based.” Cabrera v. Fresh Direct, LLC, No. 12-CV-6200,
2013 WL 4525659, at *2 (E.D.N.Y. Aug. 27, 2013) (collecting cases). That is, “any claims that
arise out of the course of conduct forming the basis of the [§] 740 claim are barred.” Barker, 885
F. Supp. 2d at 568 (collecting cases). New York state courts have largely followed the broad
interpretation. See Semeraro v. Woodner Co., No. 17-CV-8535, 2018 WL 3222542, at *7
(S.D.N.Y. July 2, 2018) (collecting cases).
“However, New York federal courts” have adopted a “narrow[]” interpretation of the
waiver provision. Id. (collecting cases); see also Barker, 885 F. Supp. 2d at 569 (collecting
7
cases). Under this interpretation, the waiver applies only to “other legal rights and remedies that
protect against the same wrong that the statute itself prohibits.” Collette v. St. Luke’s Roosevelt
Hosp., 132 F. Supp. 2d 256, 267 (S.D.N.Y. 2001). That is, the waiver applies only to “rights and
remedies concerning whistleblowing,” Humphrey v. Rav Investigative & Sec. Servs. Ltd., 169 F.
Supp. 3d 489, 501 n.12 (S.D.N.Y. 2016) (citation omitted), and does not bar “legitimately
independent claims not related to whistleblowing even if the claims have overlapping facts, such
as the same underlying retaliatory action,” Cabrera, 2013 WL 4525659, at *2 (citation and
quotation marks omitted).
Defendant, of course, argues that this Court should adopt the broad interpretation. (See
Def.’s Mem. 3–4.) Yet, as articulated in the leading analysis of the issue, see Collette, 132 F.
Supp. 2d at 260–74, the narrow interpretation “effectuates the [New York Whistleblower] Act’s
remedial purpose,” id. at 274 — namely, to “protect[] the rights of employees who report
violations of law that present a danger to public health or safety,” Barker, 885 F. Supp. 2d at 569
— because it “permit[s] employees to pursue legitimately independent claims, while prohibiting
claims that duplicate or overlap the statutory remedies for retaliation on account of
whistleblowing activity alone,” Collette, 132 F. Supp. 2d at 274. Put another way, the narrow
interpretation, by virtue of not “requiring the employee, as the price of asserting whistleblower
protection, to waive any rights he might have under independent causes of action (such as
battery, or defamation, or sexual harassment, or employment discrimination),” avoids creating a
“disincentive to invoke the Act’s protection” that would “deter[] the very whistleblowing
conduct that the Act intends to encourage.” Shipkevich v. Staten Island Univ. Hosp., No. 08-CV1008, 2009 WL 1706590, at *5 (E.D.N.Y. June 16, 2009) (citation omitted). 1 Accordingly, this
1
Separately, the narrow approach also avoids the “constitutional concerns raised by a
8
Court joins those other courts in this Circuit that, following Collette, interpret the Act’s waiver
provision to apply only to those claims relating to whistleblowing.
Applying the narrow interpretation, Plaintiff’s Title VII claim is not waived. Even
though the Title VII and whistleblower retaliation claims arise from the same “course of
conduct” — namely, Plaintiff’s employment by Defendant, his complaints to Defendant
regarding conditions at its facilities, and his termination by Defendant — they are clearly
“legitimately independent claims,” Collette, 132 F. Supp. 2d at 274, that “seek to remedy
separate wrongs,” Cabrera, 2013 WL 4525659, at *3. 2 Accordingly, the Title VII claim is not
waived. See Semeraro, 2018 WL 3222542, at *8 (holding waiver provision does not bar
collective bargaining agreement claim); Duarte v. St. Barnabas Hosp., 265 F. Supp. 3d 325, 345
(S.D.N.Y. 2017) (holding waiver provision does not bar “claims under the federal, state, or antidiscriminatory statutes”); Catapano-Fox v. City of New York, No. 14-CV-8036, 2015 WL
3630725, at *9 (S.D.N.Y. 2015) (same); Barker, 885 F. Supp. 2d at 569 (holding waiver
provision does not bar federal and state law disability discrimination claims); Kramsky v. Chetrit
construction that requires the automatic waiver of a plaintiff’s federal rights.” Humphrey v. Rav
Investigative & Sec. Servs. Ltd., 169 F. Supp. 3d 489, 501 (S.D.N.Y. 2016) (collecting cases);
see also Collette, 132 F. Supp. 2d at 266 (noting Supremacy Clause concerns under broad
interpretation of waiver provision).
2
Defendant’s argument that, even applying Collette, Plaintiff’s Title VII claim is waived
because it “arise[s] from the same wrong and [is] intertwined with the [same] facts [as] his” New
York Whistleblower Act claim, (Def.’s Mem. 4), misreads Collette and the cases following it.
The key inquiry is whether the two claims are “legitimately independent.” Collette, 132 F. Supp.
2d at 274. Plaintiff’s Title VII gender discrimination claim is independent from his
whistleblowing retaliation claim because they “seek to remedy separate wrongs.” Cabrera, 2013
WL 4525659, at *3. That is so even though the two claims “have overlapping facts” and involve
the “same underlying retaliatory action” of Plaintiff’s termination. Id. at *2 (citation omitted);
cf. Harish, 2016 WL 1181711, at *12 (holding the plaintiff waived his state-law retaliation claim
under by bringing a New York Whistleblower Act claim because “[t]here is no daylight between
the two sets of allegations” and the two laws “are textually nearly identical because they are
aimed at the same wrong”).
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Grp., LLC, No. 10-CV-2638, 2011 WL 2326920, at *6 (S.D.N.Y. June 13, 2011) (holding
waiver provision does not bar Title VII claim); Cabrera, 2013 WL 4525659, at *3 (holding
waiver provision does not bar state law gender and disability discrimination claims); Collette,
132 F. Supp. 2d at 274 (holding waiver provision does not bar disparate impact discrimination
claim).
2. ERISA Claim
a. Applicable Law
ERISA governs employee benefit plans offered and administered “by any employer
engaged in commerce or in any industry or activity affecting commerce.” 29 U.S.C.
§ 1003(a)(1). Under ERISA, a “civil action may be brought . . . by a participant or beneficiary
. . . to recover benefits due to him under the terms of his plan, to enforce his rights under the
terms of the plan, or to clarify his rights to future benefits under the terms of the plan.” 29
U.S.C. § 1132(a)(1)(B). To prevail on such a claim, “a plaintiff must establish the existence of
an employee benefit plan.” Hardy v. Adam Rose Ret. Plan, 957 F. Supp. 2d 407, 413 (S.D.N.Y.
2013), aff’d, 576 F. App’x 20 (2d Cir. 2014).
An employee benefit plan may be an “employee welfare benefit plan” or an “employee
pension benefit plan.” 29 U.S.C. § 1002(3). An employee welfare benefit plan is a plan
“established or . . . maintained for the purpose of providing for its participants or their
beneficiaries, through the purchase of insurance or otherwise,” various medical, disability, death,
and unemployment benefits. 29 U.S.C. § 1002(1). 3 An employee pension benefit plan is a plan
3
Excluded from the definition of “employee welfare benefit plan”:
(1) Payment by an employer of compensation on account of work performed
by an employee, including compensation at a rate in excess of the normal
10
“maintained by an employer . . . to the extent that by its express terms or as a result of
surrounding circumstances such plan, fund, or program — (i) provides retirement income to
employees, or (ii) results in a deferral of income by employees for periods extending to the
termination of covered employment or beyond.” Id. § 1002(2)(A). 4
ERISA, however, offers no functional definition of “plan.” The Supreme Court has
accordingly instructed that ERISA applies only to those benefit programs that require the
implementation of an “ongoing administrative program.” See Fort Halifax Packing Co. v.
Coyne, 482 U.S. 1, 11 (1987); see also Schonholz v. Long Island Jewish Med. Ctr., 87 F.3d 72,
76 (2d Cir. 1996) (stating that “ERISA subject matter jurisdiction depends upon the need for an
administrative program”); Hardy, 957 F. Supp. 2d at 413 (“The touchstone for determining the
existence of an ERISA plan is whether a particular agreement creates an ongoing administrative
scheme.” (citing Grimo v. Blue Cross/Blue Shield, 34 F.3d 148, 151 (2d Cir. 1994))). Thus,
rate of compensation on account of performance of duties under other than
ordinary circumstances, such as [overtime pay or other premiums];
(2) Payment of an employee’s normal compensation . . . on account of periods
of time during which the employee is physically or mentally unable to
perform his or her duties, or is otherwise absent for medical reasons . . . ;
and
(3) Payment of compensation . . . on account of periods of time during which
the employee, although physically and mentally able to perform his or her
duties and not absent for medical reasons (such as pregnancy, a physical
examination or psychiatric treatment). . . performs no duties [such as while
on vacation, military duty, serving as a juror or testifying, training, or on
sabbatical].
29 C.F.R. § 2510.3–1(b).
4
Excluded from the definition of “employee pension benefit plan” are “payments made
by an employer to some or all of its employees as bonuses for work performed, unless such
payments are systematically deferred to the termination of covered employment or beyond, or so
as to provide retirement income to employees.” 29 C.F.R. § 2510.3–2(c).
11
ERISA is not implicated where the employer’s benefit program merely requires it make a
“payment triggered by a single event,” such as an employee’s termination, or where the
employer’s obligation does not require administration and is satisfied by “do[ing] little more than
writ[ing] a check.” Fort Halifax, 482 U.S. at 12. This is because an employer’s promise —
absent an “ongoing administrative program or scheme” — to “make a one-time, lump-sum
payment triggered by a single event will rarely if ever implicate the need for uniformity that
Congress sought when it included within ERISA a provision that preempted state laws relating to
benefit plans.” Okun v. Motefiore Med. Ctr., 793 F.3d 277, 279 (2d Cir. 2015) (citation and
quotation marks omitted). Accordingly, to determine whether an ERISA plan requires the
implementation of an ongoing administrative scheme, the Second Circuit has instructed courts to
consider three factors: (1) “whether the employer’s undertaking or obligation requires
managerial discretion in its administration”; (2) “whether a reasonable employee would perceive
an ongoing commitment by the employer to provide employee benefits”; and (3) “whether the
employer was required to analyze the circumstances of each employee’s termination separately
in light of certain criteria.” Schonholz, 87 F.3d at 76 (collecting cases). These factors, however,
“are not the exclusive factors that may be considered, and no one is determinative.” Hardy, 957
F. Supp. 2d at 414 (citation omitted).
b. Application
Defendant argues that Plaintiff fails to allege that its severance pay plan is covered by
ERISA and, accordingly, that Plaintiff’s ERISA claim must be dismissed. (Def.’s Mem. 5.) On
a Rule 12(b)(6) motion, the Court’s review “is limited to facts stated on the face of the complaint
and in documents appended to the complaint or incorporated in the complaint by reference, as
well as to matters of which judicial notice may be taken.” Hertz Corp. v. City of New York, 1
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F.3d 121, 125 (2d Cir. 1993). However, “where the record contains the undisputed terms of the
disputed plan, . . . a [c]ourt may decide the applicability of ERISA as a matter of law.” Foster v.
Bell Atl. Tricon Leasing Corp., No. 93-CV-4527, 1994 WL 150830, at *1 (S.D.N.Y. Apr. 20,
1994) (citations omitted); see also Forte v. BNP Paribas, No. 14-CV-8556, 2015 WL 3604317,
at *2 (S.D.N.Y. June 8, 2015) (same) (citations omitted). Here, Plaintiff has attached the
relevant portions of Defendant’s severance plan to his memorandum in opposition to the Motion.
(See Pl.’s Mem. Ex. A (“Severance Plan”).) Defendant does not dispute the accuracy of these
portions or object to the Court’s considering this document, and indeed itself cites to the
Severance Plan. (See Def.’s Reply 6–7.) Accordingly, the Court considers both the allegations
contained in the Amended Complaint and the undisputed terms of the Severance Plan. See
Forte, 2015 WL 3604317, at *1 n.1 (considering severance plan pamphlet submitted by the
defendant “because it is both integral to the [a]mended [c]omplaint and incorporated in it by
reference” and because the plaintiff “does not object to the Court’s considering” it).
The Court need not, however, apply the three Schonholz factors at this time. Even
assuming the Severance Plan is covered by ERISA, the Severance Plan itself provides that
employees are eligible for severance pay only if, among other things, their “termination is a
Qualifying Event.” (Severance Plan ¶ 2.) A “Qualifying Event” is defined as “an Employee
loses employment because of reorganization, elimination of a position, or department cutback.”
(Id. ¶ 1.) Here, Plaintiff repeatedly alleges that he was “terminated” and that another employee
“replaced” him. (Am. Compl. ¶¶ 12, 24–25, 28–32, 35, 38, 41, 44–45, 51.) Plaintiff at no point
alleges that Defendant engaged in a reorganization, that his position was eliminated, or that
Defendant adopted cutbacks that caused him to be terminated. Accordingly, the Amended
Complaint does not allege Plaintiff’s eligibility for severance pay under the terms of the
13
Severance Plan.
Although Plaintiff has not requested leave to submit a second amended complaint, the
Court has considered whether he should be given an opportunity to do so. Rule 15(a)(2) of the
Federal Rules of Civil Procedure provides that a party shall be given leave to amend “when
justice so requires.” “Leave to amend should be freely granted, but the district court has the
discretion to deny leave if there is a good reason for it, such as futility, bad faith, undue delay, or
undue prejudice to the opposing party.” Jin v. Metro. Life Ins. Co., 310 F.3d 84, 101 (2d Cir.
2002) (citations omitted). Here, there is no indication that Plaintiff’s ERISA claim was made
bad faith, or that allowing Plaintiff to replead his claim would result in undue delay or prejudice
to Defendant. Nor does it “appear[] beyond doubt that . . . [P]laintiff can plead no set of facts
that would entitle him to relief,” such that repleading would be futile. Milanese v. Rust-Oleum
Corp., 244 F.3d 104, 110 (2d Cir. 2001) (citation omitted). Accordingly, the Court dismisses
Plaintiff’s ERISA claim without prejudice.
C. Supplemental Jurisdiction
Defendant argues the Court should decline to exercise supplemental jurisdiction over
Plaintiff’s New York Whistleblower Act claim. (Def.’s Mem. 6.) The Court “may decline to
exercise supplemental jurisdiction over a claim . . . if . . . [it] has dismissed all claims over which
it has original jurisdiction.” 28 U.S.C. § 1367(c)(3). Here, the Court has not dismissed
Plaintiff’s Title VII claim. Because federal claims remain, there is no basis upon which the
Court may decline to exercise supplemental jurisdiction.
III. Conclusion
For the reasons stated above, Defendant’s Motion To Dismiss is granted in part and
denied in part. Plaintiff’s ERISA claim is dismissed without prejudice. If Plaintiff wishes to file
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a second amended complaint, Plaintiff must do so within 30 days of the date of this Opinion.
Any newly filed complaint will replace, not supplement, the instant Amended Complaint, and
must contain all of the claims, exhibits, and factual allegations Plaintiff wishes the Court to
consider, as well as all changes to correct the deficiencies identified in this Opinion. If Plaintiff
fails to abide by the 30-day deadline, his claims may be dismissed with prejudice.
The Clerk is respectfully directed to terminate the pending Motion. (Dkt. No. 30.)
SO ORDERED.
Dated:
March ~
' 2019
White Plains, New York
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