Ishin v Qrt Mgt., LLC
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Ishin v Qrt Mgt., LLC 2012 NY Slip Op 33418(U) August 9, 2012 Sup Ct, New York County Docket Number: 113925/11 Judge: Manuel J. Mendez Cases posted with a "30000" identifier, i.e., 2013 NY Slip Op 30001(U), are republished from various state and local government websites. These include the New York State Unified Court System's E-Courts Service, and the Bronx County Clerk's office. This opinion is uncorrected and not selected for official publication. SCANNED ON 8/20/2012 [* 1] SUPREME COURT OF THE STATE OF NEW YORK- NEW YORK COUNTY PRESENT: MANUELJ.MENDEZ PART--'-13=------ Justice SERGEY ISHIN, INDEX NO. MOTION DATE MOTION SEQ. NO. Plalntlff, -v- 113925/11 07 -11- 2012 ~ (2'.2 J MOTION CAL. NO. - - - - - - - QRT MANAGEMENT, LLC, QUANTITATIVE RESEARCH & TRADING, LP., QRT ADVISERS, LLC, MICHAEL AKSMAN and JOHN BARTNER, Defendants. The followlng papers, numbered 1 to _i_ were read on this motion to Dismiss Pursuant to CPLR §3211 [al I11..fil and Cross-Motion to Am1;md thlil Complp!nt Notice of Motion/ Order to Show Cause - Affidavits Answering Affidavits - Exhibits cross motion 0 w (/) u< -W I- 0:: (!) 3 .., z o;: i-o C-1 W-' 0:: 0 0:: u. ww u. :c W1- 0:: 0:: >-o ju. u. ::> 1- u w Cross-Motion: f \L "UG Replylng Affidavits ~ z Exhibits X Yes No ORS NUMBERED -2 3-4 1 7 7 1~1_s~--- NEW yoRK ERK'S OFFICE Upon a reading of the foregoing cited pape~PtllllfbYh'ered that defendant's motion to dismiss this action pursuant to CPLR §3211 [a][1],[7], is granted only to the extent that all claims against Jon Bartner, lndlvldually are severed and dismissed. Plaintiff's cross-motion pursuant to CPLR §3026[b] to amend the summons and complaint, Is denied. Jon Bartner, (hereinafter referred to as defendant) makes this motion to dismiss this action pursuant to CPLR §3211 [a][7], for failure to properly state a cause of action. Defendant claims that members or managers of a limited liability company and limited partnership are not Individually liable for breach of contract and that he did not sign the employment contract. Plaintiff opposes the motion and cross-moves pursuant to CPLR §3026[b], to amend the complaint to add allegations as to John Bartner and assert additional causes of action for quantum merult and unjust enrichment. Q. (/) w 0:: ~ w (/) <C u z A motion to dismiss pursuant to CPLR §3211 [a][1], requires that the Court construe every fact the plaintiff has alleged as true. The party seeking dismissal must produce documentary evidence that "utterly refutes plaintiffs factual allegations, conclusively establishing a defense as a matter of law" (See, Leon v. Martinez, 84 N.Y. 2d 83, 638 N.E. 2d 611, 614 N.Y.S. 2d 972 [1994] and AG Captial Funding Partners and LP. v. State Street Bank and Trust Co., 6 N.Y. 3d 682, 842 N.E. 2d 471, 808 N.Y.5. 2d 573 [2005]. 0 ~ 0 :t A motion to dismiss pursuant to CPLR §3211 [a][7], requires a reading of the pleadings to determine whether a legally recognizable cause of action can be Identified and it Is properly pied (Leon v. Martinez, 84 N.Y. 2d 83, 614 N.Y.5., 2d 972, 638 N.E. 2d 611 [1994] and Guggenhelmer v. Glnzberg, 43 N.Y. 2d 268, 401 N.Y.S. 2d 182, 372 N.E. 2d 17, [* 2] ' ¢ [1977]). Documentary evidence that contradicts the allegations, or pleadings that consist of bare legal conclusions wlll not be presumed to be true and are a basis for dismissal (Morgenthow & Latham v. Bank of New York Company, Inc., 305 A.O. 2d 74, 760 N.Y.S. 2d 438 [N.Y.A.D. 1't Dept.,2003]). New York Labor Law Article 6, §190[3], has a broad definition of employer, In the context of a limited partnership or limited liability corporation, the "economic reality test" is employed. There are four factors In the "economic reality test," determination Is based on the totality of the circumstances. The economic realty test requires a determination concerning whether the alleged employer, 11 (1) had the power to hire and fire the employees; (2) supervised and controlled employee work schedules and conditions;(3) determined the method and rate of payment; (4) and maintained employment records."(Laurla v. Heffernan, 607 F. Supp. 2d 403 [U.S. Dist. Ct., EDNY, 2009]). Shareholders in a limited liability corporation may be sued under Labor Law, Article 6,§190[3], provided they qualify as employers (Wong v. Yee, 262 A.O. 2d 254, 693 N.Y.S. 2d 536 [N.Y.A.D. 111t Dept., 1999]). New York Labor Law Article 6, §190[2], defines employee as any person that Is employed for hire by an employer. New York Labor Law Article 6, §190[7], Is the catchall provision, the other sections apply to manual workers, railroad workers, commissioned salespeople. New York Labor Law Article 6, §190[7], applies to clerical and other workers that are not employed, " .. .in a bona fide executive, administrative or professional capacity, whose earnings are In excess of $900.00 per week."(McKinney's Cons. Laws of NY, Book 30, Labor Law, Article 6, §190 and Lauria v. Heffernan, 607 F. Supp. 2d 403, supra). The plaintiff Is a Connecticut resident, he brought this action against the defendants QRT Advisors, LLC, QRT Management, LLC and Quantitative Research and Trading, LP, all organized and existing under the laws of the State of Delaware and doing business as a foreign company and partnership In New York. Michael Aksman and Jon Bartner were sued lndlvldually, as officers and partners of the remaining defendants. Plaintiff claims that on March 8, 2010, pursuant to a letter agreement, he started working as a computer programmer for the defendants. The letter agreement, signed by plaintiff and Michael Aksman, as managing member, states that a plaintiff will earn a base salary of $120,000.00. The agreement also· provides for an additional bonus of $60,000.00 per year for two years, guaranteed for as long as he remains employed. Plaintiff received a letter advising him that effective December: 1, 2010, plaintiff was terminated from employment and he would receive a pro-rated bonus In the first quarter of 2011, when they were distributed. Plaintiff was unemployed from December 1, 2010 through May, 2011, and claims he never received his bonus. The Complaint asserts three causes of action against all of the named defendants (Mot. Exh. A). There are two causes _of action for breach of contract the first Includes a claim of wrongful termination and the second includes a claim of fallure to pay an earned bonus. The third cause of action Is for violation of the wage provision of Article 6 of the New York State Labor Law. Defendant pursuant to CPLR §3211[a][1], seeks to dismiss this action and provides as documentary evidence, a copy of the letter agreement and the termination letter (Mot. Exh. A, 1 & 2). Defendant claims the letter agreement establishes the plaintiff was an at will employee with no definite terms of employment and has no claim for wrongful termination. Defendant states that the complaint does not allege he personally Is plaintiffs employer [* 3] "-·· and he Is a non-signatory to the agreement. Defendant seeks to dismiss this action pursuant to CPLR §3211 [a] [7], claiming he cannot be found individually liable because there are no facts asserted that would create lndlvldual llablllty and no clear evidence that he is plaintlff's employer or that he Intended to substitute or add personal llablllty on behalf of the entitles and under Delaware Law, 6 Del.C. §18-303. Defendant claims that there is no basis to sustain plalntlff's Labor Law cause of action because plalntlff's Income exceeded $900.00 per week, as a programmer plalntiff is a professional and a member of the administrative staff. Plalntlff opposes defendant's motion claiming that the letter agreement states a twenty-four month term establishing he Is not an employee at wlll. Plalntlff claims that the bonus was earned and the defendant's refusal to pay constitutes a breach of contract. Plalntlff clalms that the defendant was an owner/employer on behalf of the entities and therefore liable under Article 6 of the New York Labor Law. Plaintiff claims that pursuant to Artlcle 6 of the New York State Labor Law, plaintiff was not an administrative or professlonal employee and regardless of the amount of his wages, he is entitled to be paid In full. Plaintiff was retained by QRT Management, LLC, and the letter agreement was signed by Michael Aksman as a managing member. Plaintiff has not established that Jon Bartner as a member or shareholder Is lndlvidually liable under the causes of action for breach of contract. Plaintiff has not establlshed that there is basis pursuant to New York Labor Law Artlcle 6, §190[3], to find that Jon Bartner was his employer. Plalntlff's annual salary, not counting his bonus, was $120,000.00, he earned more than $900.00 per week. Pursuant to CPLR §3026, leave to amend pleadings, "shall be freely granted upon such terms as may be just... " the decision to dlsallow the amendment Is at the Court's discretion (Mccaskey, Davies & Associates, Inc. v. New York City, 69 N.Y. 2d 766, 450 N.E. 2d 240, 463 N.Y.S. 2d 434 [1983]). Leave to amend should be granted as long as there Is no surprise or prejudice to the opposing party. To establish prejudice there must be a showing of hindrance In preparation of the case or the prevention from taking measures In support of a party's position (Kocourek v. Booz Allen Hamilton, Inc., 86 A.O. Jd 602, 925 N.Y.S. 2d 51 [N.Y.A.D. 1 ¢t Dept., 2011] and Loomis v. Civetta Corinna Constr. Corp. 54 N.Y. 2d 18, 429 N.E. 2d 90, 444 N.Y. 5 .2d 671 [1981]). Leave to amend a pleadlng will be denied where the proposed pleading fails to state a cause of action or is patently Insufficient as a matter of law (Davis & Davis, P.C. v. Morson, 286 A.O. 2d 584, 730 N.Y.S. 2d 293 [N.Y.A.D. 1 ¢t Dept. 2001] and Non-Linear Trading Company, Inc. v. Braddls Associates, Inc., 243 A.O. 2d 107, 676 N.Y.S. 2d 5 [N.Y.A.D. 1 ¢t Dept.,1998]). A determination as to whether a written agreement Is ambiguous is a question of law. An agreement that does not establish a fixed duration, results In a presumed "employment at will, terminable by either party, at any time. An agreement that states a salary Is measured for a period of time does not establish employment was more than as an employee at will (Todd v. Grandee Corp., 302 A.O. 2d 789, 756 N.Y.S. 2d 658 [N.Y.A.D. 3rd Dept., 2003] and LaSalle v. Board of Educ. of Bridgehampton Union Free School Dist., 82 A.O. Jd 1167, 919 N.Y.S. 2d 524 [N.Y.A.D. 2"d Dept., 2011] ). The existence of an enforceable contract covering the Issue of compensation, precludes recovery in quantum merult (Shuit v. Tree Line Management Corp., 46 A.O. 3d 405, 847 N.Y.S. 2d 580 [N.Y.A.D. 1 ¢t Dept 2007]). ·--·-· [* 4] ¢ - ·Plaintiff cross-moves pursuant to CPLR §3025[b], to amend the comp la Int. Plalntiff seeks to add allegations and documentary evidence as to Jon Bartner's role as employer, and assert a cause of action for violation of the Delaware Wage and Payment Collectlon Act. Plalntlff also seeks to assert additional causes of action for quantum merult and unjust enrichment. Plaintiff clalms that the amended pleadings address alleged defects as stated in the defendant's motion papers. Plalntlff annexes four exhibits to the proposed Second Amended Summons and Complaint. Exhibit 2 is a copy of the termination letter signed by Michael Aksman. Exhibits 3 and 4, are letters sent by plaintitrs attorney to both Michael Aksman and Jon Bartner. Exhibits 2, 3, and 4 do not estahllsh that Jon Bartner is plalntitrs employer. Exhibit 1 is an series of e-mails starting March 1, 2010 through March 2, 2010. Only one emall dated March 1, 2010, Involves Jon Bartner extending an offer on behalf of QRT Management, LLC, the remaining e-mails were sent by Mlchael Aksman. Plaintiff has not established a basis to add the exhibits or assert the additional causes of action. Plaintlff has not established that the defendants would not be surprised .or prejudiced by the proposed amendments. Plaintiff has not provided a basis to amend the complaint, there remain Issues of fact as to the terms of the written agreement, but an agreement exists. Plaintltrs claims based on quantum meruit and unjust enrichment apply to compensation for rendered services, to the extent he seeks to recover for the entire two year period, those causes of action would not apply. Plalntlff has not established that the Delaware Wage and Payment Collectlon Act, applles In this New York action. Upon review of all the papers submitted with this motion and cross-motion, this Court finds that Jon Bartner has established a basis pursuant to CPLR §3211 [a][1],[7], to dismiss the claims asserted against him lndlvldually. Plalntiff has not established a basis to replead and submit a Second Amended Summons and Complalnt. The amendment seeks to provide more detailed descriptions stlll does not result in proper causes of action. Accordingly, It Is ORDERED that JON BARTNER 's motion to dismiss In lleu of an answer pursuant to CPLR §3211[a] [1],[7], Is granted, only to the extent that all clalms against Jon Bartner, Individually are severed and dismissed, and It is further, ORDERED, that the causes of action asserted against the remaining defendants In the complalnt are continued, and It is further, ORDERED, that plaintiffs cross-motion pursuant to CPLR §3026[b] to amend the summons and complaint, is denied. This constitutes the decision and order of this court. ENTER: MANUEL~EZ, Dated: August 9, 2012 Check one: J.S.C. D FINAL DISPOSITION Check if appropriate: 0 DO NOT POST - ¢ ¢A'-lllEL J. MENDEZ M'J{NUEL J.MENDll~. '.c:::.c. X NON-FINAL DISPOSITION 0 REFERENCE
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