Plaintiffs Thomas A. Datre Sr. ("Mr. Datre"), Clara Datre ("Mrs. Datre" and, together with Mr. Datre, the "Datres"), and Daytree at Cortland Square, Inc. ("Daytree" and, collectively, "plaintiffs") bring this action against defendants Michael P. Walsh, Edward Walsh,
In particular, plaintiffs allege that defendants conspired and carried out a plan to cause local authorities and the public to wrongly believe plaintiffs were responsible for dumping toxic materials in the Roberto Clemente Park (the "Park"), a public park in the Town. Plaintiffs allege that, as part of the conspiracy, defendant Michael Walsh used his position as Deputy Town Attorney to proclaim that the Town had completed an investigation and determined that plaintiff Daytree was responsible for the toxic dumping-a statement that defendants allegedly knew to be false. Specifically, plaintiffs assert that there was no investigation by the Town, nor was there a finding that Daytree was responsible. Additionally, plaintiffs claim that defendants shared this false information with the Suffolk County District Attorney's Office ("DA's Office") and the media, leading to widespread dissemination via social media. Plaintiffs allege that defendants' defamatory statements were motivated by a desire to deflect blame for the environmental scandal onto plaintiffs for defendants' own political gain.
As a result of defendants' allegedly false statement that plaintiffs were responsible for the toxic dumping, plaintiffs claim that they have suffered extreme injuries, including Mr. Datre's removal from a paid position with the Town, the raid and seizure of plaintiffs' contracting business as a result of the DA's Office investigation, the filing of multiple civil lawsuits against plaintiffs by third parties, and plaintiffs' vilification in the community, which has prevented them from resuming business operations, among other harms. Plaintiffs allege loss of their personal and professional reputations in addition to business and monetary harms. Plaintiffs seek compensatory and punitive damages for the alleged violations of their civil rights, as well as a declaratory judgment that they are not a responsible party for any alleged dumping in the Park.
Presently before the Court is defendants' motion to dismiss the complaint.
I. BACKGROUND
A. Factual Background
1. The Allegations of Toxic Dumping
The Court takes the following facts from plaintiffs' complaint and the exhibits attached thereto.
Starting in or around August 2013, the Town's Parks Department supervised the creation of soccer fields inside the Park, which involved contractors delivering fill materials to the Park. (Compl. ¶¶ 102-03.) Defendant Senft, who served as the Town Board's liaison to the Parks Department (the "Parks Liaison") at the time, was among those individuals at the Parks Department supervising this project (the "Park project").
2. The Political Backdrop
According to the complaint, defendants accused plaintiffs of the alleged toxic
Mr. Datre has served as the chairman of a local and national Political Action Committee ("PAC"), through which he has raised "hundreds of thousands of dollars in campaign moneys" for both Republican and Democratic candidates. (Id. ¶ 5.) According to the complaint, "much to the chagrin" of defendants, Mr. Datre has not raised funds for the Conservative Party or its candidates. (Id. ¶ 6.) At the time of the events at issue, defendants allegedly felt that Mr. Datre's fundraising activities had hurt the Suffolk County Conservative Party by limiting its leader's ability to influence the outcomes of elections. (Id. ¶¶ 6-8.)
Many of plaintiffs' allegations involve that leader, Eddie Walsh, who served as the Suffolk County Conservative Party's Chairman. (Id. ¶ 233.) Although Eddie Walsh was dismissed as a defendant from this case, the complaint alleges that the other defendants were his "political operatives" and participated in the alleged conspiracy in furtherance of his political objectives. (See, e.g., id. ¶¶ 6-8, 10, 15-22.) The remaining defendants in this case all held positions in the Conservative Party; some also held positions in the Town municipal government. These defendants include: Michael Walsh, member of the Conservative Chairman's Club (id. ¶ 236), member of the Town of Islip Conservative Executive Committee (id. ), and Deputy Town Attorney (id. ¶ 70); Michael Torres, Town of Islip Conservative Party Chairman, serving directly under Eddie Walsh (id. ¶ 234); Robert Cicale, Town Attorney (id. ¶ 25); and Anthony Senft, Jr., Committeeman of the Town of Islip Conservative Party, serving directly under Eddie Walsh, and Parks Liaison (id. ¶¶ 74, 235). Plaintiffs also sued councilmembers Steven Flotteron, John Cochrane, Jr., and Trish Weichbrodt, but in their official capacities only. (Id. ¶¶ 78-82.)
Plaintiffs allege that Eddie Walsh had secured paid positions in the Town government for his political operatives, several of whom were responsible for overseeing the Park at the time of the alleged dumping. (Id. ¶ 9.) Two of Eddie Walsh's alleged operatives who are not defendants in this case served as the Parks Commissioner (the "Commissioner") and Secretary to the Parks Commissioner (the "Secretary"). (Id. ¶ 11.) According to the complaint, sometime prior to January 21, 2014, the Commissioner, Secretary, and defendant Senft (Parks Liaison) learned of the allegations that there had been unlawful dumping of potentially toxic materials "while the park was under their collective supervision." (Id. ¶ 12.) They allegedly consulted with Eddie Walsh and defendant Torres, "their Islip Conservative Party Superiors ... who had secured ... their positions within the Town." (Id. ¶ 15.) Plaintiffs claim that, at this point, Eddie Walsh and defendants Torres, Senft, and Michael Walsh became concerned that the three Parks Department officials could be held responsible for the dumping, and thus "fabricated and proceeded to carry out a plan" to "deflect blame" away from them and onto plaintiffs. (Id. ¶¶ 15, 113.)
3. The Datres' Relationship with the Town and Individual Defendants
At the time of these events, plaintiffs Mr. and Mrs. Datre were the principals of
Plaintiffs allege that, as of January 2014, defendants "were affirmatively aware" that the Datres were the principals of Daytree (id. ¶ 104), and had contracted to perform tree removal services for the Town (id. ¶ 112), and that the Datres' son, Thomas Datre, Jr. ("Datre Jr."), owned a materials transport company that was "completely separate and independent from the company owned by his parents" (id. ¶¶ 105-06). Plaintiffs allege defendants were aware that Datre Jr.'s transport company was involved in the Park project, and had transported materials into the Park. (Id. ¶ 107.) Plaintiffs allege defendants were also aware that, unlike their son's company, they had not transported materials into the Park. (Id. ¶ 111.)
After receiving complaints about dumping in September 2013, the Commissioner and defendant Torres met with Datre Jr. to discuss these complaints. (Id. ¶¶ 110-11.) Plaintiffs assert that the Commissioner and Torres arranged this meeting because defendants knew of Datre Jr. and his company's involvement in the Park project and in transporting materials into the Park.
Plaintiffs allege that, in furtherance of this plan, Torres and another member of the Conservative Party appeared at Daytree's office and falsely accused plaintiffs of illegally dumping construction and/or other materials in the Park. (Id. ¶ 119.) The Datres informed them that neither they nor their company had dumped "anything, whatsoever" in the Park. (Id. ¶ 112.) Plaintiffs allege that, despite this conversation, Eddie Walsh and defendants Torres, Senft, and Cicale "then conspired to ... have defendant Michael P. Walsh use his position as Deputy Town Attorney" to shift blame for the dumping to plaintiffs and falsely state that the Town had "completed" an investigation, through which it determined that plaintiffs were responsible. (Id. ¶ 121.)
According to the complaint, defendant Walsh
4. The Alleged Defamatory Statements
Plaintiffs allege that on April 24, 2014, defendant Walsh made the aforementioned defamatory statements about plaintiffs, which he knew to be false, and subsequently published these statements to third parties, including the press and the DA's Office. (Id. ¶¶ 123, 126, 130.) As discussed supra , the alleged false statements were that the Town had completed an investigation through which it had determined that Daytree was a "responsible party" for the toxic dumping. (Id. ¶ 124.) First, defendant Walsh sent five letters to insurance companies on April 24, 2014, each stating:
Please be advised that our office received notice of dumping of construction material on town property located at [Roberto Clemente Park].... Enclosed please find photos and field reports completed by town law enforcement person[nel] of the debris at the subject location. This letter shall serve to place your company on notice of the above listed loss.
We have completed our investigation and found that Daytree at Cortland Square is a responsible party.
(ECF No. 1-1 at 11-15.)
In this case, it's not that we made a final determination. We have insurance policies on file with the town of Islip for work done by this company, that may have also been done in the park, and if that's enough of a connection or a nexus for us, we're going to protect our interests.
(Id. ¶ 26.) Plaintiffs assert that Cicale was referencing the work they did under their tree-removal contract, "which was limited to the plaintiffs removing trees, tree trunks and branches at the request of the Town." (Id. ¶ 27.)
According to the complaint, defendants also informed the media and DA's Office that they had completed an investigation and found Daytree to be responsible. (Id. ¶ 32.) As a result, Newsday published the following articles: "Islip Town formally blames dumping on Daytree [at] Cortland Square," dated May 25, 2014, and "ISLIP PLACES BLAME: Tells insurers Daytree at Cortland Square at fault," dated May 26, 2014. (Id. ¶ 33; ECF No 1-1 at 17-20, 22-24.) According to the first Newsday article, "Walsh's letters to the insurance companies represent the first formal notification by Islip as to who town officials believe is responsible for the dumping." (ECF No 1-1 at 17.) Additionally, the story was published on television and the radio (see Compl. ¶ 34 (citing ECF No 1-1 at 51-52 (News 12 article, "Town of Islip blames [Daytree] in dumping scandal"), 54 (LI News Radio article discussing Daytree, "Islip blames contractor for toxic dumping") ) ), and was disseminated via social
5. The Alleged Harm to Plaintiffs
According to the complaint, Facebook users' responses to news stories about the toxic dumping, featuring Daytree, show the public outrage that led plaintiffs to feel defendants "vilified" them. For instance, one Facebook user wrote, "Du[m]ping toxic waste in [a] playground where children play? ... Brentwood is a vulnerable, disadvantaged, segregated community. The racist implicati[o]ns are obvious. Real pigs." (ECF No 1-1 at 56.) Another portion of this message seems to incite violence against those responsible for the dumping. (See id. )
Plaintiffs allege that defendants further stigmatized them by terminating their two-year tree-removal contract with the Town shortly after sending the aforementioned letters to the insurance companies. (Compl. ¶¶ 36-37; ECF No. 1-2 at 2 (defendant Walsh's letter to Mrs. Datre terminating the contract).) Plaintiffs assert that this termination was "without cause, and without any form of hearing prior to such termination." (Compl. ¶ 37.) Plaintiffs allege that Eddie Walsh and defendants Senft, Cicale, and Michael Walsh "caused" the Town to terminate this contract and "contemporaneously publish to the press that the Town was 'severing all ties' with the plaintiffs." (Id. ¶¶ 36, 139.) The same defendants allegedly also caused the Town to terminate Mr. Datre from a paid position as the Town's Plumbers Examining Board Chairman, without cause or hearing, and again shared this information with the press. (Id. ¶¶ 38-39.) In both instances, plaintiffs allege that Eddie Walsh and these three defendants "exercised their influence and control over the Town and defendants Flotteron, Cochrane Jr. and Bergin-Weichbrodt" to bring about these contract terminations. (Id. ¶¶ 139-40.)
Finally, defendants allegedly accused plaintiffs of having committed "heinous criminal activity (i.e., illegal dumping of toxic materials in a children's public park) ," as a result of which the DA's Office raided, seized, and "abruptly shut[ ] down" plaintiffs' business. (Id. ¶¶ 41-45.) Plaintiffs claim that the DA's Office seized all of their personal property and, to date, has not returned any of it. (Id. ¶ 46.)
According to the complaint, defendants' actions that publicly vilified plaintiffs were "equally fatal to the plaintiffs' business" as those of the DA's Office. (Id. ¶ 47.) Plaintiffs discuss the thousands of images of Mr. Datre "mailed directly to residents" in Suffolk County, thereby associating his picture with "the company that dumped 32,000 tons of toxic waste in our local parks." (Id. ¶ 48; ECF No. 1-2 at 10-11.) Plaintiffs claim that they cannot resume their normal business operations because they "are now shunned by the community, to the extent that no one with whom they formerly conducted business will speak to them." (Compl. ¶ 47.) As discussed supra , plaintiffs claim that they have suffered a "loss of both their personal and professional reputations." (Id. ¶ 51.) They claim that they have suffered financial loss due to loss of their business, and became defendants in multiple civil lawsuits as a result of defendants' defamatory statements. (Id. ¶¶ 50, 53.)
B. Procedural Background
Plaintiffs commenced this action on April 22, 2015. Defendants filed a motion to dismiss on November 13, 2017. Plaintiffs filed their opposition to defendants' motion on January 11, 2018. Plaintiffs replied on February 2, 2018. The Court held oral argument on February 5, 2018, and reserved
II. STANDARD OF REVIEW
In reviewing a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6), the Court must accept the factual allegations set forth in the complaint as true and draw all reasonable inferences in favor of the plaintiff. See Cleveland v. Caplaw Enters. ,
The Supreme Court clarified the appropriate pleading standard in Ashcroft v. Iqbal , setting forth a two-pronged approach for courts deciding a motion to dismiss.
III. DISCUSSION
Defendants move to dismiss, arguing that plaintiffs' claims surrounding their "political conspiracy theory" fail, and that the complaint amounts to a "wholly defective, state law claim for defamation." (Defs. Mem. at 3.) Specifically, defendants move to dismiss plaintiffs' complaint on the grounds that: (1) plaintiffs' claim for declaratory judgment and injunctive relief must be dismissed because these are remedies, rather than independent causes of action, (2) the "single statement at issue" is not defamatory as a matter of law, (3) plaintiffs fail to state a "stigma-plus" claim, (4) plaintiff Daytree's material breach of its contract with the Town precludes plaintiffs' breach of contract claim, and (5) plaintiffs fail to state a conspiracy claim under Section 1983. Defendants move to dismiss with respect to (1) the Town under Monell , (2) the councilmember defendants, who were sued only in their official capacities, and (3) the remaining individual defendants based on qualified immunity.
As discussed infra , the Court concludes that the request for declaratory and injunctive relief must be dismissed, and the claims against the individual councilmember defendants in their official capacity are dismissed as duplicative of the municipal liability claim. The motion to dismiss is
A. Claims for Declaratory and Injunctive Relief
1. Applicable Law
Under the Declaratory Judgment Act, "[i]n a case of actual controversy within its jurisdiction," a federal court "may declare the rights and other legal relations of any interested party seeking such declaration, whether or not further relief is or could be sought."
The party seeking a declaratory judgment bears the burden of demonstrating that the district court has jurisdiction-that is, that there is an "actual controversy,"
"Whether a real and immediate controversy exists in a particular case is a matter of degree and must be determined on a case-by-case basis." Kidder, Peabody & Co., Inc. v. Maxus Energy Corp. ,
2. Analysis
Plaintiffs argue that they are entitled to a declaratory judgment, pursuant to
Defendants request that the Court dismiss these claims on the grounds that (1) declaratory judgment and injunctive relief are remedies, rather than independent causes of action, and (2) plaintiffs have failed to establish that an actual controversy exists as required for the Court to award such relief. Defendants argue that plaintiffs "impermissibly seek[ ] an advisory opinion which is without a sufficient nexus to the independent claims asserted." (Defs. Reply at 3.) Defendants explain that the issues surrounding plaintiffs' responsibility for the dumping are "front and center in separate actions" that are currently pending in this court, including one before the undersigned. (Id. (citing Town of Islip v. Datre , No. 16-cv-2156 (E.D.N.Y filed Apr. 29, 2016), and Seggos v. Datre , No. 17-cv-2684,
The Court agrees with defendants. As a threshold matter, it is well settled that a request for declaratory and/or injunctive relief is not an independent cause of action. See KM Enterprises, Inc. v. McDonald , No. 11-cv-5098 (ADS)(ETB),
With respect to declaratory relief, given that the pending actions defendants reference were brought "pursuant to the actual applicable law" to determine liability for dumping in the Park (Defs. Reply at 3; see also Pls. Mem. at 7 (discussing multiple CERCLA cases naming plaintiffs as defendants) ), a declaratory judgment in this case runs the risk of amounting to an advisory opinion. Norton v. Town of Brookhaven ,
Plaintiffs argue that a declaratory judgment in this case would not lead to inconsistency with a subsequent decision in the Town of Islip case because this case was filed first, and would thus "have priority." (Pls. Mem. at 7 n.3.) However, the focus of this lawsuit is much narrower than the declaratory relief sought by plaintiffs. More specifically, plaintiffs allege here that the Town's statements were false because (1) no investigation had been completed by the Town , and (2) no determination had been made by the Town that plaintiffs were the responsible party for the alleged dumping. In other words, the claims hinge on the Town's conduct and knowledge, and the falsity of those statements by the Town could potentially be resolved without a determination as to the parties responsible for any alleged dumping. Therefore, plaintiffs seek declaratory relief regarding past conduct that is not an essential element of the claims brought here, and essentially seek an advisory opinion with respect to the subject matter of other pending lawsuits. In addition, a declaratory judgment that plaintiffs were not responsible parties likely would not settle the issues, Dow Jones & Co. ,
Plaintiffs have also failed to articulate in the complaint any basis for injunctive relief in connection with the federal or state claims. It is well settled that "[t]he fact that the false statements may injure the plaintiff in his business or as to his property does not alone constitute a sufficient ground for issuance of an injunction. The party wronged has an adequate remedy at law." Bynog v. SL Green Realty Corp. , No. 05 Civ. 0305 WHP,
B. Defamation Claim (Libel)
1. Applicable Law
In order to state a cause of action for libel under New York law, a plaintiff must plead: (1) a written false and defamatory statement of fact concerning the plaintiff; (2) that was published by the defendant to a third party; (3) due to the defendant's negligence or actual malice, depending on the status of the person libeled; and (4) special damages or per se actionability. Celle v. Filipino Reporter Enters. ,
A statement that is an expression of opinion, not fact, cannot be the subject of an action for defamation. Mann v. Abel ,
(1) whether the specific language in issue has a precise meaning which is readily understood; (2) whether thestatements 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 ... [to] readers or listeners that what is being read or heard is likely to be opinion, not fact.
Under New York law, "[g]enerally, a written statement may be defamatory 'if it tends to expose a person to hatred, contempt or aversion, or to induce an evil or unsavory opinion of him in the minds of a substantial number of the community.' " Golub v. Enquirer/Star Grp., Inc. ,
To determine whether a statement is "of and concerning" the plaintiff, courts in this circuit look for a "reasonable connection between the plaintiff and the alleged libel." Church of Scientology Int'l v. Time Warner ,
Even where the pleading requirements for a defamation claim have been met, New York law affords qualified protection to statements that are "fairly made by a person in the discharge of some public or private duty, legal or moral, or in the conduct of his [or her] own affairs, in a matter where his [or her] interest is concerned." Front, Inc. v. Khalil ,
A defendant forfeits this qualified privilege by making a false, defamatory statement with "malice" .... Common-law malice "mean[s] spite or ill will," and defeats the privilege only if it is "the one and only cause for the publication," .... Constitutional or "actual" malice means publication with "knowledge that [the statement] was false or ... reckless disregard of whether it was false or not."
2. Analysis
Plaintiffs bring their defamation claim based on allegations that defendants made multiple statements that the Town had completed an investigation and determined they were "a responsible party" for the illegal dumping in the Park. Plaintiffs allege that these statements include the letters to the insurance companies, as well as the subsequent statements to Newsday and the DA's Office. They argue that these statements "not only accuse the plaintiffs of committing serious criminal activity, but also tended to severely injure the plaintiffs in their trade, business and occupation" (Compl. ¶ 175), and were "defamatory and libelous per se " (id. ¶ 173). Plaintiffs discuss the reverberating effects of these statements in addition to the harms to their reputations, business, and livelihood, including "[g]awkers" visiting plaintiffs' offices "to sneer at the plaintiffs," hate messages on the company's answering machine, and the shunning and harassment plaintiffs' grandchildren endured at school, among others. (Id. ¶¶ 176-82.)
As a premise for their motion to dismiss this claim, defendants argue that plaintiffs challenge a single defamatory statement: the statement in defendant Walsh's letters to the insurance companies. Defendants request that the Court dismiss this claim on the grounds that (1) the statement at issue failed to meet the pleading requirements, in particular, because the statement was not of "fact," "defamatory," or directed at the Datres, and (2) regardless, the statement qualified as privileged. (Defs. Mem. at 9-14.)
Before turning to the pleading requirements, the Court rejects defendants' premise that plaintiffs' claim challenges a single statement (even if repeated in multiple letters to insurers). At this stage, plaintiffs have adequately alleged that the defamatory statements included multiple statements, including those to the media and the DA's Office, in addition to the initial statements to the insurers. The news articles, other publications, and public social media response that plaintiffs supplied in their exhibits provide support for plaintiffs' plausible claim that defendants' statements went beyond defendant Walsh's initial communications.
The Court has considered defendants' remaining arguments regarding the alleged defamatory statements and, for the reasons discussed below, denies their motion to dismiss this claim.
i. Statement of Fact
First, the Court considers defendants' argument that the statement in the letters to the insurers does not qualify as a "false and defamatory statement of fact " because it "takes a legal position more akin to an opinion." (Defs. Mem. at 10.) The Court disagrees. Defendant Walsh's statement that the Town completed an investigation and found plaintiffs to be responsible satisfies each of the requirements in the New York standard for distinguishing fact from opinion: the statement has a "precise meaning," it is capable of being proven true or false, and the context of the insurance letter indicates that this was a factual statement. Mann ,
Although defendants point out that the Court must look at the context, an analysis of that context does not change the factual nature of the statements. As an example, context impacted this analysis in Mann , where the court determined that the at-issue statement was one of opinion based in part on the tone, and the fact that the statement appeared in the "opinion page" of a newspaper along with a note that the article expressed the author's opinion.
ii. Defamatory Statement
With regard to the defamatory nature of defendants' statements, the Court concludes that even what defendants assert is plaintiffs' single alleged statement-namely, that, after an investigation, plaintiffs were found to be responsible for toxic dumping in a public children's park-easily satisfies this pleading requirement.
iii. "Of and Concerning"
With respect to the question of whether defendants' statements were "of and concerning" all three plaintiffs, the Court concludes that plaintiffs have asserted facts that could plausibly satisfy this element for each of the plaintiffs.
Although the "of and concerning" requirement is generally an issue of fact, which the jury alone may decide, the Court properly may dismiss an action pursuant to Rule 12(b)(6) where the statements "are incapable of supporting a jury's finding that the allegedly libelous statements refer to plaintiff." Whether the complaint alleges facts sufficient to demonstrate a reasonable connection between the plaintiff and the alleged libel is thus a question for the Court.
Church of Scientology Int'l ,
Defendants argue that this element cannot be satisfied because the statement at issue named Daytree, but not the Datres, as a responsible party. Courts have allowed claims where the statement did not identify the plaintiff, but named an individual who was understood to represent that plaintiff. See Dalbec ,
Here, notwithstanding the fact that the statement refers to Daytree only (and not to Mr. and Mrs. Datre), plaintiffs argue that readers would understand the statement to refer to all three plaintiffs because (1) the Datres were the only principals of Daytree, and "as the owners of
Given the facts alleged in the complaint, and drawing all reasonable inferences in plaintiffs' favor for purposes of this motion to dismiss, the Court concludes that it is plausible that the allegedly defamatory statements are capable of supporting a jury's finding that such statements refer to plaintiffs. See Excellus Health Plan, Inc. v. Tran ,
iv. Litigation Privilege
Finally, defendants argue that the alleged defamatory statements, contained in letters issued to Daytree's insurers, are absolutely privileged as pertinent to litigation. As set forth below, the Court also declines to dismiss the claim at this stage because the Court cannot determine, based on the complaint, that these defamatory statements are protected by the litigation privilege.
First, plaintiffs allege that the statements in the letters to the insurance carriers were not "pre-litigation" in any respect. (See Pls. Mem. at 13 ("The letters, mailed to the insurance carriers and a broker and eventually given by Defendants to the press and District Attorneys' office, certainly served no pre-litigation function .... The statements were purely unsolicited third party communications intentionally designed to shift focus and blame away from the Defendants and onto the Datres." (footnote and citation omitted) ).) Defendants, on the other hand, want the Court to take judicial notice of the fact that it is "common knowledge that such notice letters are a compulsory component of insurance protocols and the litigation (of either the underlying claim or disputed coverage) that they so often precede."
Similarly, even assuming arguendo that the letter falls within the pre-litigation privilege, dismissal in this case would still be unwarranted because only a
In sum, the motion to dismiss the defamation (libel) claim is denied.
C. Stigma-Plus Claim
In order to bring a Section 1983 due process claim on a so-called "stigma-plus" theory, a plaintiff must allege "a stigmatizing statement plus a deprivation of a tangible interest." Vega v. Lantz ,
Even where these requirements have been met, "the availability of adequate process defeats a stigma-plus claim." Segal v. City of New York ,
In support of their stigma-plus claim, plaintiffs allege that defendants' false statements were not merely defamatory and injurious to their business and reputations, but that defendants maliciously brought about a deprivation of their constitutional rights. Specifically, plaintiffs allege that-without providing any form of due process-defendants deprived them of their liberty interests, including their chosen occupations, and their property rights, including Daytree's tree-removal contract with the Town and Mr. Datre's paid position on the Town's Plumbers Examining Board. Further, plaintiffs allege that the Town's "top-ranking officials and final decision-makers" (naming defendants Senft, Cicale, Walsh,
The Court concludes that plaintiffs have adequately alleged both elements required for a stigma-plus claim. First, for the same reasons discussed in relation to the state-law defamation claim, the Court finds that plaintiffs have adequately pled that defendants made "sufficiently derogatory [statements] to injure [their] reputation[s]." Vega ,
Defendants argue that, even if plaintiffs adequately alleged a deprivation of their liberty and/or property interests, their stigma-plus claim fails because they did not pursue an Article 78 post-deprivation proceeding and, as discussed supra , "the availability of adequate process" defeats a stigma-plus claim. Segal ,
First, the Court concludes that plaintiffs' allegations regarding defendants' scheme to blame them for toxic dumping, if true, would defeat any argument that defendants' defamatory statements and contract termination were "random and unauthorized" government action. Second, plaintiffs' liberty and property interests at issue fall within the category of interests that the Second Circuit has found requires a pre-deprivation hearing. In Segal , the Second Circuit recognized that adequate process varies based on the interest at stake.
The Court concludes that, in light of both the alleged nature of defendants' actions and plaintiffs' specific interests at stake, plaintiffs have plausibly asserted that they were entitled to a pre-deprivation hearing. The availability of an Article 78 post-deprivation proceeding, therefore, is clearly an inadequate substitute and does not defeat their stigma-plus claim with respect to at least the two-year tree-removal contract. The Second Circuit has also found this process to be inadequate where stigma-plus claims were based on actions other than terminations of government employment. See DiBlasio ,
D. Breach of Contract Claim
In order to state a breach of contract claim, courts in this circuit have required plaintiffs to allege, "at a minimum, the terms of the contract, each element of the alleged breach and the resultant damages." Kaplan v. Aspen Knolls Corp. ,
Plaintiffs claim that the Town breached its tree-removal contract with Daytree by "fail[ing] to pay plaintiff [Daytree] for such services rendered." (Compl. ¶ 227.) According to the complaint, on or about December 13, 2012, the Town "adopted a formal resolution awarding a contract to plaintiff Daytree" for two years, under which Daytree "was to provide tree trimming, tree removal, and stump removal services" in exchange for payment at the contractual rates. (Id. ¶ 222.) Plaintiffs allege that both parties executed the contract, and that Daytree performed these services until the Town terminated the contract without cause on May 7, 2014. (Id. ¶ 223, 225-26.) Plaintiffs claim that defendants owe Daytree an amount equal to or exceeding $73,940 for the services Daytree performed under the contract, as well as an additional $1.6 million for the third-party services the parties contracted for Daytree to provide. (Id. ¶¶ 227-31.)
Defendants argue that plaintiffs failed to attach a copy of the contract to the complaint, or to allege the material terms of the contract. The Court disagrees, and finds that plaintiffs have adequately pled the necessary elements of their breach of contract claim. At this stage, plaintiffs were required to "disclose sufficient information to permit the defendant[s] 'to have a fair understanding of what the plaintiff is complaining about and to know whether there is a legal basis for recovery.' " Kittay v. Kornstein ,
The Court declines to accept defendants' request that it "take judicial notice of plaintiff Daytree's material breach" and grant the motion to dismiss this claim on this basis. (Defs. Mem. at 18.) Defendants argue that Daytree breached by failing to pay prevailing wages in connection with its performance of this contract, and assert that Daytree pleaded guilty to and was convicted of this offense. (Id. ; Defs. Reply at 11.) Although courts will take judicial notice of facts such as that of a conviction, see Vaughn v. Consumer Home Mortg. Co. ,
E. Conspiracy Claim
It is well established that a plausible Section 1983 conspiracy claim must allege "(1) an agreement between a state actor and a private party; (2) to act in concert to inflict an unconstitutional injury; and (3) an overt act done in furtherance of that goal causing damages." Ciambriello v. County of Nassau ,
As discussed at length supra , plaintiffs allege that defendants conspired to deflect blame for the dumping in the Park from themselves onto plaintiffs, in order to preserve their reputations and to further their political objectives (which plaintiffs allegedly hindered through their own political activities). Plaintiffs discuss the roles each of the individual defendants held in the Town's municipal government and/or the Conservative Party.
F. Liability of Specific Defendants
1. Municipal Liability Claim
A municipal entity may be held liable under Section 1983 where the plaintiff demonstrates that the constitutional violation complained of was caused by a municipal "policy or custom." Monell v. Dep't of Soc. Servs. of City of N.Y. ,
Additionally, a single action can "provide[ ] a basis for municipal liability where it is taken by, or is attributable to, one of the city's authorized policymakers." Amnesty Am. v. Town of West Hartford ,
Plaintiffs sued the Town, alleging that defendants' actions were "undertaken at the direction of, and with the consent of, the Town officials who ... possessed ... final decision-making authority at the Town." (Compl. ¶ 192.) Plaintiffs assert that the individual defendants, who participated in the conspiracy and "affirmatively authorized" defendant Walsh's actions, include final decision-makers of the Town, among them Town councilmembers, the Town Attorney, and the Deputy Town Attorney. (Id. ¶ 193.) Plaintiffs also note that defendant Walsh's letters were sent using Town letterhead, and argue that these letters constituted "formal policies and decisions of the Town." (Id. ¶ 194.)
In short, the Court concludes that plaintiffs have alleged sufficient facts to state a plausible claim for municipal liability under Monell in light of the actions allegedly taken by the Town's "authorized policymakers." Amnesty Am. ,
2. Official Capacity Claims
With regard to the individual defendants sued in their official capacities, plaintiffs brought claims against councilmember defendants in their official capacities as agents of the Town. "[O]fficial-capacity suits generally represent only another way of pleading an action against an entity of which an officer is an agent." Castanza v. Town of Brookhaven ,
Plaintiffs stated in their complaint that councilmember defendants Flotteron, Cochrane, and Weichbrodt were joined "in their official capacities as Councilmembers ... only, and no claim[ ] for personal or individual liability is asserted against such defendants herein." (Compl. ¶ 199.) Councilmember defendants have moved to dismiss all claims brought against them in their official capacities. Because the Town is named as a defendant-and, as discussed supra , the claims against the Town survive this motion-the Court grants the motion to dismiss all claims as brought against the councilmember defendants.
3. Qualified Immunity
"Qualified immunity attaches when an official's conduct 'does not violate clearly established statutory or constitutional rights of which a reasonable person would have known.' " White v. Pauly , --- U.S. ----,
The Court considers this motion with respect to the remaining individual defendants: Michael Walsh, Torres, Cicale, and Senft. Torres served as the Town Conservative Party Chairman, but did not hold a position within the Town government. Given that Torres was not a government actor, he cannot claim qualified immunity for his allegedly defamatory statements or his alleged participation in the conspiracy.
With respect to the other three individual defendants, they argue that they are entitled to qualified immunity in light of their objectively reasonable beliefs that their actions did not violate a constitutional right. Their primary defense is that the Town sent the letters to the insurers to protect the Town's interests, "in the objectively-reasonable exercise of governmental functions and duties." (Defs. Mem. at 22-23.) Defendants argue that it was objectively reasonable to identify Daytree as responsible "based on [the] Town's law enforcement photos and reports as the letters indicate." (Id. at 23.)
The Court concludes that the qualified immunity issue cannot be decided at the motion to dismiss stage given the allegations in the complaint. As discussed supra , plaintiffs allege that the individual defendants participated in disseminating knowingly false and defamatory statements, in bad faith, for the specific purpose of destroying their business and reputation, including by terminating their tree-removal contract with the Town. Moreover, the complaint alleges that, as part of this malicious plan, defendants falsely stated that an investigation had been conducted, and a finding of responsibility reached, even though they knew that neither of those things had taken place. In other words, according to the complaint, defendants wrote these false and defamatory letters
In sum, if the allegations in the complaint are true, there would be no basis for concluding that defendants held an objectively reasonable belief that their actions would not violate plaintiffs' constitutional rights. The Court, therefore, denies the remaining individual defendants' motion to dismiss based on qualified immunity. However, this issue may be raised again at the summary judgment stage.
IV. CONCLUSION
For the foregoing reasons, the Court grants defendants' motion to dismiss the claims for declaratory and injunctive relief and all claims against the councilmember defendants (Flotteron, Cochrane, and Weichbrodt), but denies the motion in all other respects.
SO ORDERED.
Notes
On August 21, 2015, the complaint was dismissed by stipulation as against Edward Walsh. (ECF No. 25.) Thus, references to "defendant Walsh" in this opinion are to Michael Walsh.
Defendant Michael Torres is not represented by the attorneys that submitted the joint motion to dismiss, but the remaining defendants note in their papers that "Counsel for Mr. Torres has ... indicated that he joins in and adopts the arguments set forth herein." (ECF No. 57.) The Court, therefore, accepts this motion to dismiss as filed on behalf of all remaining defendants, including Torres.
As discussed infra , in considering a motion to dismiss, courts may consider documents attached to, integral to, or referred to in the complaint, as well as documents filed in other courts and other public records. See, e.g., Glob. Network Commc'ns, Inc. v. City of New York ,
Plaintiffs state that the two other members of the Parks Department team supervising the soccer field project are also defendants in this action (Compl. ¶ 103), but plaintiffs did not serve them and it does not otherwise appear they named them as defendants.
The allegations regarding the alleged illegal dumping are the subject of a separate lawsuit. See Town of Islip v. Datre ,
Plaintiffs emphasize that the Commissioner and Secretary attested in sworn statements to knowing of Datre Jr. and his company's involvement. (Id. ¶ 109.)
As stated supra , any reference to "defendant Walsh" is to Michael Walsh, rather than Eddie Walsh (against whom the complaint was dismissed).
ECF No. 1-1 contains a compilation of exhibits attached to the complaint.
In the following sections, the Court discusses whether plaintiffs' claims are dismissed with respect to defendants generally. The Court notes that, as the complaint is dismissed with respect to the three councilmember defendants (Flotteron, Cochrane, and Weichbrodt), where it denies the motion to dismiss specific claims, that denial is with respect to the four non-councilmember individual defendants (Walsh, Torres, Cicale, and Senft) and, for the Section 1983 claims, the Town.
Defendants note that "[n]o defamation claim is stated as against Defendants Senft or Cincale since neither is alleged to have made the defamatory statement." (Defs. Mem. at 9 n.3.) In light of the Court's conclusion that plaintiffs alleged multiple defamatory statements in connection with the alleged conspiracy, the Court rejects this argument.
Defendants noted at oral argument that they sent this notice to plaintiffs' insurers, rather than their own. They argue that the insurers would therefore be especially likely to investigate and challenge defendants' claim. This argument does not change the Court's assessment that defendants' statement is factual in nature.
The Court also notes that the statement regarding responsibility for the alleged dumping could itself provide a plausible basis for a defamation claim because it could be reasonably understood as being based upon undisclosed facts justifying the opinion. See, e.g., Long v. Marubeni Am. Corp. ,
Defendants argue that the statement was not defamatory because of the "exceedingly narrow context"-its purpose was to notify the insurers of the potential claim, and its audience was limited to those companies. As discussed supra , the Court rejects these arguments because plaintiffs have alleged multiple defamatory statements, including those to the media and DA's office. Considering all of these communications, the Court finds that plaintiffs have at this stage adequately alleged that defendants' statements were defamatory.
Defendants argue that they sent these letters because the insurers' policies "might be called upon to satisfy damages" if toxic materials were found in the Park. (Defs. Mem. at 10.) Defendants claim that they sent these letters to "protect the Town's rights" by notifying the insurers of potential claims "as a predicate to and in contemplation of litigation." (Id. at 11.) Defendants argue that the statements to Daytree's insurers were privileged because the insurers "could help in the resolution of the dispute." (Id. at 13.)
For the purposes of this discussion, the Court references the required process as a "pre-deprivation hearing." The Court recognizes, however, that in some cases there could be other forms of adequate pre-deprivation process. See, e.g., Adams v. Suozzi ,
Plaintiffs include the "Deputy Town Attorney" in this list, who they identified earlier as defendant Walsh.
Had plaintiffs brought this claim based on only the deprivation of their rights to pursue their chosen occupation, defendants' motion would present a more difficult question. In Valmonte v. Bane , the Second Circuit explained,
Our prior decisions indicate, as does Paul v. Davis , that defamation is simply not enough to support a cognizable liberty interest. It therefore follows that the deleterious effects which flow directly from a sullied reputation would normally also be insufficient. These would normally include the impact that defamation might have on job prospects, or, for that matter, romantic aspirations, friendships, self-esteem, or any other typical consequence of a bad reputation.
In the Second Circuit's subsequent decisions in stigma-plus cases, it has since found Article 78 post-deprivation proceedings to be adequate where the right at issue was at-will government employment, see Gallagher v. N.Y.C. Health & Hosps. Corp. , No. 17-2942-CV,
In their roles as members of the Conservative Party, defendants were not state actors. Although some held positions in both, defendant Torres, at least, held no position within the Town government. Plaintiffs' claim, thus, does not run afoul of the intracorporate conspiracy doctrine, which provides "that the officers, agents and employees of a single corporate or municipal entity, each acting within the scope of his employment, are legally incapable of conspiring together."Henneberger v. County of Nassau ,