Suarez v. Mosaic Sales Solutions US Operating Co., LLC
17-2344-cv
| 2d Cir. | Jan 11, 2018Background
- Plaintiff Daniel Suarez received a job offer from Mosaic Sales Solutions, which Mosaic later rescinded after a background check revealed two misdemeanor convictions.
- Suarez sued under New York City’s Fair Chance Act alleging Mosaic failed to follow required procedures before rescinding the offer and sought between $75,000 and $100,000 in damages (lost wages, compensatory, punitive, and fees).
- Mosaic moved to dismiss for lack of subject-matter jurisdiction under Federal Rule of Civil Procedure 12(b)(1), arguing the amount in controversy did not meet the $75,000 threshold for diversity jurisdiction.
- Mosaic submitted an affidavit showing the position was seasonal/part-time (16 hours/week at $15/hr) and was actually eliminated within four weeks, yielding at most $960–$2,400 in back pay.
- Suarez claimed garden-variety emotional distress and punitive damages could push his claim over $75,000; he also noted he found another job and did not allege significant medical treatment.
- The district court dismissed the complaint for lack of diversity jurisdiction; the Second Circuit affirmed, concluding Suarez’s likely recoverable damages could not meet the jurisdictional minimum.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the court has diversity jurisdiction under 28 U.S.C. § 1332 because the amount in controversy exceeds $75,000 | Suarez claimed damages (lost wages, emotional distress, punitive, attorneys’ fees) exceed $75,000 | Mosaic showed the employment was temporary/part-time and actual lost wages were at most $2,400 (and $960 given the position’s elimination) and challenged large non-economic and punitive awards | Held: No diversity jurisdiction — plaintiff’s likely recoverable damages could not meet $75,000 |
| Whether garden-variety emotional distress claims here could reasonably support damages sufficient to meet jurisdictional amount | Suarez argued humiliation, stress, and weight gain justify a large compensatory award | Mosaic argued the distress allegations were routine and not comparable to case law awarding large emotional-distress damages | Held: Emotional-distress claims here were insufficient; cited cases with substantially more serious injuries support larger awards, which do not apply here |
| Whether punitive damages could be presumed to meet amount in controversy | Suarez asserted punitive damages could push total over $75,000 | Mosaic argued recruiter error showed negligence, not the willful/wanton or reckless conduct required for large punitive awards; courts should scrutinize punitive claims | Held: Punitive damages not likely given facts (apology, recruiter error); cannot be relied on to establish jurisdictional amount |
| Whether attorney’s fees may be included in computing amount in controversy | Suarez sought fees as part of relief | Mosaic noted attorney’s fees under NYCFCA are discretionary | Held: Attorney’s fees were not included because they are not recoverable as of right under the NYCFCA |
Key Cases Cited
- Morrison v. Nat’l Austl. Bank Ltd., 547 F.3d 167 (2d Cir. 2008) (party asserting federal jurisdiction must prove it by a preponderance of the evidence)
- Colavito v. N.Y. Organ Donor Network, Inc., 438 F.3d 214 (2d Cir. 2006) (defendant may rebut complaint’s amount-in-controversy by showing to a legal certainty plaintiff cannot recover alleged amount)
- Zappia Middle E. Constr. Co. v. Emirate of Abu Dhabi, 215 F.3d 247 (2d Cir. 2000) (courts may consider evidence outside the pleadings in amount-in-controversy disputes)
- Patterson v. Balsamico, 440 F.3d 104 (2d Cir. 2006) (upholding large emotional distress award where plaintiff suffered physical and egregious harms)
- MacMillan v. Millennium Broadway Hotel, 873 F. Supp. 2d 546 (S.D.N.Y. 2012) (district court reduced emotional distress awards in hostile work environment context)
- Broome v. Biondi, 17 F. Supp. 2d 211 (S.D.N.Y. 1997) (upholding significant emotional distress award for willful racial discrimination)
- Zahn v. Int’l Paper Co., 469 F.2d 1033 (2d Cir. 1972) (courts should scrutinize punitive damages claims when computing jurisdictional amount)
- Givens v. W.T. Grant Co., 457 F.2d 612 (2d Cir. 1972) (attorney’s fees included in amount in controversy only if recoverable as of right)