Worldhomecenter.com, Inc. v. M.J. Resurrection, Inc., No. 1:2011cv03371 - Document 26 (S.D.N.Y. 2012)
Court Description: OPINION: Based on the conclusions set forth herein, the defendant's motion to dismiss is denied. (Signed by Judge Robert W. Sweet on 12/29/2011) (ft)
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UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK ---x WORLDHOMECENTER.COM, INC., 11 Civ. 3371 Plaintiff, OPINION -against- M.J. RESURRECTION, INC., d/b/a FRESH WAREHOUSING, a/k/a FRESH WAREHOUSE, Defendant. A P PEA RAN C E S: Attorney for Plaintiff WOODS & LONERGAN, LLP 292 Madison Avenue, 22 nd Floor New York, NY 10017 By: Lawrence R. Lonergan/ Esq. At for Defendant LEWIS BRISBOIS BISGAARD & SMITH LLP 77 Water Street, Suite 2100 New York, NY 10005 By: Carmine Joseph Castellano/ Esq. NIELSON LAW FIRM, LLC 3838 North Causeway Blvd., Suite 2850 Metairie, LA 70002 By: Kevin M. Phillips, Esq. Kelley A. Gandurski/ Esq. Sweet, D.J. Defendant M.J. Resurrection, Inc. ("M.J. Resurrection" or the "Defendant") has moved, pursuant to Fed. R. Civ. P. 12(b) (6), to dismiss the Verified Complaint (the "Complaint") of plaintiff Worldhomecenter.com, Inc. the "Plaintiff"). ("Worldhomecenter.com" or Upon the facts and conclusions set forth below, the Defendant's motion is denied. Prior Proceedings On March 21, 2011, the Plaintiff filed the Complaint in the Supreme Court of the State of New York, County of New York. Worldhomecenter.com is an online retailer of home products sold through its websites, HomeCenter.com and SupplyHouse.com. M.J. Resurrection is engaged in the business of receiving, storing and shipping goods. The Complaint seeks to recover damages resulting from the Defendant's alleged manipulation of Worldhomecenter.com's inventory over a five year period. On or about July 17, 2006, the Plaintiff and the Defendant entered into a contract (the "Agreement") under which M.J. Resurrection was to receive, store and ship worldhomecenter.com's goods to Worldhomecenter.com's customers. 1 The Agreement, which identifies Worldhomecenter.com as the "Depositor" and M.J. Resurrection as the "Warehouseman," contains the following language: NOTICE OF CLAIM AND FILING OF SUIT Sec. 11 (a) Claims by the Depositor and all other persons must be presented in writing to the Warehouseman within a reasonable time, and in no event longer than either 90 days after delivery of the goods by the Warehouseman or 120 days after a physical inventory report and discrepancy report is given to Depositor by Warehouseman, whichever period is longer. (b) No action may be maintained by the Depositor or others against the Warehouseman for loss or injury to the goods stored unless timely written claim has been given as provided in paragraph (a) of this section, and unless such action is commenced either within nine months after the date of delivery by Warehouseman or within nine months after Depositor of record or the last known holder of a negotiable warehouse receipt is notified that loss or injury in part all of the goods has occurred, whichever time is shorter. (c) When goods have not been delivered, notice may be given of known loss or injury to the good by mailing of a registered or certified letter to the Depositor of record or the last known holder of a negotiable warehouse receipt. Limitations of time for presentation of claim writing and maintaining of action after notice shall accrue on the date of mailing of such notice by Warehouseman. The Complaint alleges that M.J. Resurrection, while serving as steward of Worldhomecenter.com's inventory, exacted inflated invoice payments from the Plaintiff, costing 2 Worldhomecenter.com lost product, profits, customers and standing with credit processors. The Complaint alleges three causes of action: violation of U.C.C. ยง 7-204, breach of contract and conversion. On May 17, 2011, the Defendant moved to remove the case from the Supreme Court of the State of New York, County of New York to the Southern District of New York. On June 21, 2011, the Defendant moved to dismiss the Complaint, pursuant to Fed. R. Civ. P. 12 (b) (6) The motion was marked fully submitted on August 11, 2011. The Rule 12(b) (6) Standard On a motion to dismiss pursuant to Rule 12, all factual allegations in the complaint are accepted as true, and all inferences are drawn in favor of the pleader. Mills v. Polar Molecular Corp., 12 F.3d 1170, 1174 (2d Cir. 1993). The issue "is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims." Villager Pond, Inc. v. Town of Darien, 56 F.3d 375, 378 (2d Cir. 1995) (quoting Scheuer v. Rhodes, 416 U.S. 232, 235-36, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974)) 3 To survive a motion to dismiss pursuant to Rule 12(b) (6) I "a complaint must contain sufficient factual matter accepted as true on its face. l " to 'state a claim to relief that is plausible l Ashcroft v. Iqbal 1949 1 173 L.Ed.2d 868 550 U.S. 544 1 570 l 1 (2009) 556 U.S. 662 l 1 129 S.Ct. 1937 1 (quoting Bell Atl Corp. v. Twombly I 127 S.Ct. 1955 1 167 L.Ed.2d 929 (2007)). Plaintiffs must allege sufficient facts to "nudger ] their claims across the line from conceivable to plausible." Twombly 550 U.S. at 570. I Though the court must accept the factual allegations of a complaint as true, it is "not bound to accept as true a legal conclusion couched as a factual allegation." ~--- I 129 S.Ct. at 1950 (quoting Twombly I 550 U.S. at 555). The Defendant's Motion To Dismiss Is Denied M.J. Resurrection ses two arguments in favor of its motion to dismiss the Complaint. rst, the Defendant contends that the Complaint should be dismissed under Section ll(a) of the Agreement because Worldhomecenter.com failed to provi written notice of its claims wi in 120 days after the Defendant provided a physical inventory and discrepancy report. Second, the Defendant contends that the Complaint should be dismissed 4 under Section 11(b) of the Agreement because, in addition to failing to meet the requirements of Section 11(a), t Plaintiff failed to file its lawsuit within the applicable nine month limitations period. With respect to the Defendant's first contention that the Complaint should be dismissed because the Plaintiff did not provide adequate notice of its claims, Section 11(a) of the Agreement states: Claims by the Depositor and all other persons must be presented in writing to the Warehouseman within a reasonable time, and in no event longer than either 90 days after delivery of the goods by the Warehouseman or 120 days after a physical inventory and discrepancy report is given to Depositor by Warehouseman, whichever period is longer. The Defendant contends that, on March 16, 2010, M.J. Resurrection provided Worldhomecenter.com with a Notice of Lien for outstanding charges. Attached to the Notice of Lien was an "Inventory by Item H of all the goods being held on behalf of Worldhomecenter.com. As such, M.J. Resurrection states that, under Section 11(a) of the Agreement, the Plaintiff had 120 days after receipt of the Notice of Lien to present its claims to the Defendant in writing. Because no such writing was made, M.J. Resurrection contends that the Complaint should be dismiss 5 The Defendant's second argument is that the Plaintiff failed to fi suit within the time afforded under Section 11(b) of the Agreement. Section 11(b) provides: No action may be maintained by the Depositor or others against the Warehouseman for loss or injury to the goods stored unless timely written claim has been given as provided in paragraph (a) of this section and unless such action is commenced either within nine months after date of ivery by Warehouseman or within nine months a er Depositor of record of the last known holder of a negotiable warehouse receipt is notified t loss or injury in part or all of the goods has occurred, whichever time is shorter. The Defendant contends that, in addition to failing to abide by the provisions of Section 11(a), the Complaint shou dismissed because the Plaintiff also be led to commence his lawsuit within the nine months provided under the Agreement. With respect to the Defendant's first argument, the Second Circuit has held that "[w]here the dates in a complaint show that an action is barred by a statute of limitations, a defendant may raise the affirmative defense in a pre-answer 869 F.2d 160, 161 (2d Cir. 1989). Here, the "statute of limitations" the Defendant identifies refers to the longer of 90 6 following "delivery of the goods" or 120 days following receipt of "a physical inventory and discrepancy report." details have been provided conce goods," and the De ng t focuses on Although t No "delivery 120 day limitations Defendant claims that M.J. Resurrection provided Worldhomecenter.com with "a physical inventory and discrepancy report" in the form of the Notice of Lien and accompanying Inventory by Item, the Complaint avers that M.J. Resurrection never provided a discrepancy report to the PIa iff at any time. See Compl. ~~ 1, 14, 25. Additionally, although the Defendant contends that the Plaintiff failed to provide written notice of s claim, the Worldhomecenter.com did as evi Compl. nt states that written not to the Defendant, in email communications between t ~ 15. parties. See At the pleading stage, Worldhomecenter.com is under no obligation to support its pleading with evidence, as all statements in the Compla purposes are accepted as true for iding a Rule 12(b) (6) motion. See Hamilton Chapter of Alpha Delta Phi, Inc. v. Hamilton College, 128 F.3d 59, 63 (2d Cir. 1997) i Giglio v. Dunn, 732 F.2d 1133, 1134 (2d Cir. 1984). Drawing all inferences in favor of t it cannot sa intiff, that Section 11{a) precludes relief. Worldhomecenter.com from obta 7 See Hamilton Colle , 128 F.3d at 62-63 ("A dismiss ars beyond doubt that the plaintiff can 12 (b) (6) only if 'it prove no set of facts in support of his entit is warranted under Rule him to relief.''') (quoting Conle aim which wou v. Gibson, 355 U. s. 41, 45 46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957)). The Defendant's second contention that the Complaint should dismissed because the Plainti more than n months a filed this lawsuit r M.J. Resurrection sent the Notice of Lien is so insufficient to warrant granting of the motion to dismiss. Under Section 11(b), there are two events from whi the nine month time interval is measured: "date of delivery," or the date on which the "Depositor of record of t last known ho r of a negoti warehouse receipt is notif that loss or injury in part or all of the goods has occurred." Although the Defendant avers that it sent the Notice of Lien and Inventory by Item on March 16, 2010, M.J. Resurrection has made no representations concerning se two key events. Defendant has Accordingly, led to illustrate why Section 11(b) requires that the Complaint be dismissed. Section 11(b) limits the ability action "for the Depositor to file an s or injury to the goods stored." however, is not 1 Furthermore, Complaint, ted to "loss or injury to the goods stored," 8 r lost profits, future profits and but rather seeks damages loss of potential bus ss. As such, it cannot said that, when all factual in s are drawn in favor of the Plaintiff, Worldhomecenter.com has iled to state a claim upon which relief can be grant Conolusion on Defendant's mot conclusions set forth above, the to dismiss is denied. It is so ordered. New York, NY Deoember ~( , 2011 ROBERT W. SWEET U.S.D.J. 9
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