Opinion
19-CV-4255(GRB)(AYS)
2021-08-12
Nicholas MOSCATELLI, Plaintiff, v. OWL'S NEST, INC., Woodbury Medical Practice, P.C., Samuel Sutton, individually, Tara Accavallo, individually, Caesar Truant, individually, and Elizabeth Sullivan, individually., Defendants.
Ishan Dave, Derek Smith Law Group PLLC, New York, NY, for Plaintiff. A. Jonathan Trafimow, Jennifer Calamia, Moritt Hock & Hamroff LLP, Garden City, NY, Joan Badere Lopez, Lewis Brisbois Bisgaard & Smith LLP, New York, NY, for Defendants Woodbury Medical Practice, P.C., Elizabeth Sullivan. Jack Babchik, Alexandra Lee Robins, Babchik & Young, LLP, White Plains, NY, for Defendant Samuel Sutton. William D. Wexler, North Babylon, NY, for Defendant Tara Accavallo.
Ishan Dave, Derek Smith Law Group PLLC, New York, NY, for Plaintiff.
A. Jonathan Trafimow, Jennifer Calamia, Moritt Hock & Hamroff LLP, Garden City, NY, Joan Badere Lopez, Lewis Brisbois Bisgaard & Smith LLP, New York, NY, for Defendants Woodbury Medical Practice, P.C., Elizabeth Sullivan.
Jack Babchik, Alexandra Lee Robins, Babchik & Young, LLP, White Plains, NY, for Defendant Samuel Sutton.
William D. Wexler, North Babylon, NY, for Defendant Tara Accavallo.
MEMORANDUM OF DECISION & ORDER
GARY R. BROWN, United States District Judge: Presently before the Court is defendants’ motion for summary judgment as to the pending Title VII claims. Docket Entry ("DE") 44. Because plaintiff cannot establish that his former employer had at least 15 employees consistent with the statute, summary judgment is granted. Furthermore, the Court declines to exercise supplemental jurisdiction over the remaining state law causes of action, which are therefore dismissed without prejudice.
The Amended Complaint and Procedural History
As relevant herein, the amended complaint sets forth claims for discrimination "on the basis of sex/gender, sexual orientation, and caregiver status, along with a hostile work environment, retaliation as a result of Plaintiff's opposition to these unlawful practices and request for Family Medical leave, and wrongful termination." DE 21 ¶ 1. The allegations – which are specific and troubling, though vigorously contested – purported to set forth claims pursuant to Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000 et. seq. ("Title VII"), the Family and Medical Leave Act of 1993 ("FMLA"), as well as related state law claims.
The complaint describes two entities, Owl's Nest, Inc. ("Owl's Nest") (which was never served) and defendant Woodbury Medical Practice, P.C. ("Woodbury"). DE 1 ¶¶ 10-11. The complaint states that these two entities hired plaintiff as a nurse practitioner, and conclusorily alleges that the two entities "merged" in September 2017. Id. ¶ 22. Thus, the complaint concludes, Owl's Nest and Woodbury "jointly" employed plaintiff. Id. ¶ 23. Furthermore, the amended complaint alleges, without supporting detail, that the defendants "meet the definition of an ‘employer’ under all applicable and local statutes." Id. ¶ 20.
Shortly after the filing of the complaint, in September 2019, defendants filed a letter seeking a pre-motion conference to dismiss plaintiff's Title VII claim based on a failure to allege that Woodbury, even if deemed a joint employer with Owl's Nest, had fifteen employees so as to qualify as an employer under Title VII. DE 6 at 3. That application was denied, as the Court granted plaintiff leave to file an amended complaint. Order dated October 21, 2019.
The amended complaint was filed in November 2019; defendants soon renewed their application to move to dismiss, noting that, even as amended, the complaint made no allegation that the alleged joint employers had fifty employees as required to support the FMLA claims. DE 21, 22. In opposing that application, plaintiff's counsel noted – without any factual support – that "Plaintiff contends that corporate Defendants had fifty or more employees. Plaintiff has already alleged this by stating, ‘Defendants meet the definition of an ‘employer.’ " DE 23.
Judge Azrack held a pre-motion conference on January 23, 2020. At that conference, the Court ruled that motion practice would be held in abeyance, and the parties were directed to complete targeted discovery on the question of the number of employees within 60 days. According to counsel, at that conference "all counsel agreed that if [Woodbury] never employed fifteen (15) or more people for the number of weeks required for coverage under Title VII, there would be no basis for federal court jurisdiction, and the Court would be free to decline to exercise supplemental jurisdiction over Plaintiff's state and local law claims." DE 34. After the sixty day period elapsed, counsel represented that "Discovery on this limited issue is complete." Id.
Shortly thereafter, this matter was transferred to the undersigned. After a period of inactivity, the Court required the filing of a status report, see Order dated October 5, 2020, in which report counsel for plaintiff again represented that "Plaintiff contends that corporate Defendants had fifty or more employees, and far more than fifteen employees, as Defendants Owl's Nest and Woodbury were joint employers." DE 38. Motion practice resumed.
At a premotion conference before the undersigned, counsel for plaintiff could not support the repeated contention that the two entities combined had 50 employees, aside from a subjective "belief" by plaintiff. DE 42 at 8, 10. He stated that "neither party has the information relating to the number of employees employed by Owl's Nest." Id. at 8. Plaintiff's counsel had served neither a summons nor a third-party subpoena on Owl's Nest. Id. at 9. Despite an initial explanation about a "fenced-off property with like a booth" thwarting efforts to obtain the requisite information, after being reminded that the power of the federal court would likely overcome such hurdles, counsel acknowledged that the decision not to pursue Owl's Nest was tactical. Id. Because there was no evidence establishing that, even as joint employers, Owl's Nest and Woodbury had more than 50 employees, the Court granted summary judgment as to plaintiff's FMLA claims, and directed the parties to brief the remaining grounds for summary judgment. Id. at 19.
Facts
Facts which are undisputed – or ineffectively disputed – and relevant herein, include the following:
Dr. Sullivan, a medical practitioner and licensed doctor of osteopathy, is the President and sole shareholder of Woodbury. DE 39-2 at II.A ¶¶ 1-2. That entity, a New York professional corporation licensed to practice medicine, was incorporated in June 2017. Id. ¶¶ 3-4. While she has an ownership interest in another medical practice entity not involved in this matter, Sullivan has no ownership interest or management role in any other entity. Id. ¶ 5. Woodbury has always had fewer than 15 employees. Id. ¶ 9. Sullivan was Woodbury's sole employee from its formation until August 31, 2017, at which time plaintiff and ten employees from Owl's Nest were employed by Woodbury. Id. ¶ 10. Importantly, defendants offer the following concerning the management of Woodbury:
At all times since [Woodbury] was incorporated, Dr. Sullivan alone has made all hiring, retention, discipline, termination and other employment decisions at [Woodbury]. Dr. Sullivan has done so without interference or direction from any other company or entity. Dr. Sullivan has had no involvement in any hiring, discipline, termination or other employment decisions of any company or entity other than [Woodbury or one unrelated entity].
Id. ¶ 11. Plaintiff's effort to dispute this assertion, which comprises a citation to a paragraph of his affidavit and one of defendant Accavallo which are essentially irrelevant to these matters, fails. Id. No other company or entity has been involved in decisions relating to production, distribution, marketing, advertising, payroll, bookkeeping or tax preparation at Woodbury, nor has Woodbury been so involved in other companies’ decision making. Id. ¶¶ 40-44. There is no sharing of bank accounts, shipping accounts or workers compensation policies between the entities. Id. ¶ 41.
Counsel carefully documents Woodbury's hiring history, making clear that at no time did it employ more than 14 employees – a high-water mark that only lasted a short time – and these assertions are undisputed. Id. ¶¶ 13-20, 22-27. These factual recitations are documented in voluminous business records. DE 44-3. At no time has Woodbury, standing alone, qualified as an employer under the statute. DE 39-2 at II.A ¶¶ 27-29. Plaintiff's employment contract with Woodbury, as with all of its employees, expressly defines that Woodbury as the "employer." Id. ¶¶ 37-38. Sullivan has solely supervised all Woodbury's employees. Id. ¶ 46.
In affidavits opposing summary judgment, plaintiff avers that he was hired as an employee of Owl's Nest to provide medical services for a wealthy family (whose identity is the subject of non-disclosure agreements) by the father in that family and one of the daughters. DE 44-10 ¶¶ 1-4. Dr. Sullivan, who runs Woodbury, did not hire him or other employees of Owl's Nest that plaintiff depicts as "joint employees." Id. ¶ 6. In September 2017, plaintiff, together with four other Owl's Nest employees, were advised that they would no longer be employed by Owl's Nest, but rather now worked for Woodbury. Id. ¶ 7. After the move, obtained without application by or interview of plaintiff, his job remained unchanged in terms of duty, pay, location or responsibilities. Id. ¶¶ 8-9, 15-16. After his "transfer" to Woodbury, plaintiff's supervisor at Owl's Nest continued to prepare his schedule, and Dr. Sullivan supervised plaintiff both before and after the transfer. Id. ¶¶ 10, 13, 19. According to plaintiff, the unnamed family members that the two entities served "had the power to completely control Plaintiff's employment, including the ability to assign him job duties and hire and fire him," and "assigned tasks to all employees of both entities." Id. ¶¶ 25-26.
The situation with Owl's Nest remains more opaque. Very little information has been supplied by the parties about its ownership structure or the number of its employees. Notwithstanding the opportunity afforded to plaintiff to seek discovery from and about Owl's Nest, it seems that no such information has been obtained and, despite its inclusion in the caption of this case, no effort was made to obtain a summons for Owl's Nest. Plaintiff, urged by Judge Azrack and the undersigned to seek discovery from Owl's Nest, simply failed to do so.
DISCUSSION
Summary Judgment Standard
This motion for summary judgment is decided under the oft-repeated and well-understood standard for review for these matters, as discussed in Bartels v. Inc. Vill. of Lloyd Harbor, 97 F. Supp. 3d 198, 211 (E.D.N.Y. 2015), aff'd, 643 F. App'x 54 (2d Cir. 2016), which discussion is incorporated by reference herein. In sum, the question before the Court is whether, based upon the undisputed or improperly disputed facts, the defendants are entitled to judgment.
Title VII Claim
"An employer is not covered by the provisions of Title VII, unless the employer has at least fifteen employees." Arculeo v. On-Site Sales & Mktg., LLC , 425 F.3d 193, 195 (2d Cir. 2005) (citing 42 U.S.C. § 2000e(b) ). More specifically, "Title VII imposes liability for employment discrimination only on an ‘employer,’ which is defined by the statute as ‘a person engaged in an industry affecting commerce who has fifteen or more employees for each working day in each of twenty or more calendar weeks in the current or preceding calendar year, and any agent of such a person’." Id. at 197. At times, this requisite can be satisfied through application of the "single employer" (a/k/a "single integrated employer") and joint employer doctrines to multiple entities. Id. The Second Circuit has articulated the differences between these doctrines as follows:
A ‘single employer’ situation exists ‘where two nominally separate entities are actually part of a single integrated enterprise. In such circumstances, of which examples may be parent and wholly-owned subsidiary corporations, or separate corporations under common ownership and management, the nominally distinct entities can be deemed to constitute a single enterprise. There is well-established authority under this theory that, in appropriate circumstances, an employee, who is technically employed on the books of one entity, which is deemed to be part of a larger "single-employer" entity, may impose liability for certain violations of employment law not only on the nominal employer but also on another entity comprising part of the single integrated employer.
In a "joint employer" relationship, in contrast, there is no single integrated enterprise. A conclusion that employers are "joint" assumes that they are separate legal entities, but that they ... handle certain aspects of their employer-employee relationship jointly. Where this doctrine is operative, an employee, formally employed by one entity, who has been assigned to work in circumstances that justify the conclusion that the employee is at the same time constructively employed by another entity, may impose liability for violations of employment law on the constructive employer, on the theory that this other entity is the employee's joint employer.
Id. at 198 (alterations omitted). Plaintiff appears to argue these theories in the alternative, though only the single enterprise theory can be analyzed on this record.
Due to plaintiff's failure to collect and submit evidence concerning the management and ownership structure of Owl's Nest plaintiff cannot demonstrate a joint employer relationship as it would be impossible, on this record, to draw any inferences suggesting that these two employers "handle certain aspects of their employer-employee relationship jointly." Fowler v. Scores Holding Co., 677 F.Supp.2d 673, 681 (S.D.N.Y. 2009). In fact, the undisputed evidence offered by Dr. Sullivan demonstrates otherwise.
Notably "the law only treats the employees of a corporate entity as the employees of a related entity under extraordinary circumstances." Murray v. Miner, 74 F.3d 402, 404 (2d Cir. 1996). Moreover, "the policy underlying the single employer doctrine is the fairness of imposing liability for labor infractions where two nominally independent entities do not act under an arm's length relationship." Id. at 405. The Second Circuit has held:
To determine whether two separate entities should be considered a single employer for the purposes of employment discrimination claims, courts have relied on four considerations: (1) interrelation of operations; (2) centralized control of labor relations; (3) common management; and (4) common ownership or financial control. See Cook v. Arrowsmith Shelburne, Inc., 69 F.3d 1235, 1240 (2d Cir. 1995). "Although no one factor is determinative ... control of labor relations is the central concern." Murray v. Miner, 74 F.3d 402, 404 (2d Cir. 1996).
Griffin v. Sirva Inc., 835 F.3d 283, 292 (2d Cir. 2016). The undisputed facts weigh heavily, if not conclusively, against plaintiff as to these factors. Uncontested evidence offered by Dr. Sullivan disposes of the first and fourth elements – she asserts, without contradiction, that she is the exclusive owner of Woodbury, which does not share operations with Owl's Nest.
On the question of common management, plaintiff makes only one argument: plaintiff claims that he was subject to common supervision concerning his work at both entities. Defendants dispute this claim, but, of course, on a motion for summary judgment the Court must construe facts in favor of the non-movant, and the existence of a genuine issue of material fact could warrant a trial. At the same time, as the Supreme Court has held:
At the summary judgment stage, facts must be viewed in the light most favorable to the nonmoving party only if there is a "genuine" dispute as to those facts. Fed. Rule Civ. Proc. 56(c). As we have emphasized, "[w]hen the moving party has carried its burden under Rule 56(c), its opponent must do more than simply show that there is some metaphysical doubt as to the material facts.... Where the record taken as a whole could not lead a rational trier of fact to find for the nonmoving party, there is no ‘genuine issue for trial.’ " Matsushita Elec. Industrial Co. v. Zenith Radio Corp. , 475 U.S. 574, 586–587, 106 S.Ct. 1348, 89 L.Ed.2d 538 (1986) (footnote omitted). "[T]he mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Anderson v. Liberty Lobby, Inc. , 477 U.S. 242, 247–248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). When opposing parties tell two different stories, one of which is blatantly contradicted by the record, so that no reasonable jury could believe it, a court should not adopt that version of the facts for purposes of ruling on a motion for summary judgment.
Scott v. Harris , 550 U.S. 372, 380, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007).
The only evidence submitted by plaintiff in opposing summary judgment consists of his two affidavits, which differ in substance. See DE 39-1 and 44-10. Defendants correctly complain about this departure from accepted practice and urge the Court to strike the second affidavit. DE 44-11 at 5ff. However, the differences between the affidavits, as well as internal inconsistencies in those documents, prove helpful in considering the motions. Perhaps most tellingly, in his initial affidavit, plaintiff repeatedly averred that Woodbury and Owl's Nest, taken together, employed more than fifty individuals. DE 39-1 ¶¶ 3, 5, 13. Three months later, after it was revealed in Court that this convenient yet plainly false assertion by plaintiff was entirely unsupported by any evidence, plaintiff submitted another affidavit omitting this clearly erroneous statement. See generally DE 44-10. Nevertheless, the false premise that the two entities had more than fifty employees remains a specious mantra in plaintiff's Rule 56.1 statement, used in an effort to rebut numerous assertions by defendants. DE 39-2 ¶¶ 9, 13, 20, 21, 27, 28, 29, and 39, counterstatement ¶¶ 3, 5. That is to say, inasmuch as plaintiff points to no evidence in the record as to the number of employees either Owl's Nest or Woodbury employed, plaintiff's blanket statements in his affidavits without more do not raise an inference that he was employed at a worksite where fifty or more or fifteen or more employees were employed at Woodbury and/or Owl's Nest. Cf. Scott v. ProClaim America Inc., No. CV 14-6003 (DRH), 2017 WL 1208437, at *10 (E.D.N.Y. Mar. 31, 2017).
The Court exercises its discretion to reject these blatant assertions, and deems admitted all paragraphs of the 56.1 statement in which this false construct constitutes plaintiff's sole support.
In his two affidavits, plaintiff vacillates as to the nature of his supervision while employed by the two companies, such that his assertions prove internally contradictory and unclear. His affidavits refer to an individual named Patricia Nolan as his "supervisor at Owl's Nest." DE 39-1 ¶ 21; DE 44-10 ¶ 31. At the same time, he avers that "Sullivan supervised Plaintiff both before and after Plaintiff [worked for] Owl's Nest." DE 39-1 ¶ 23; DE 44-10 ¶¶ 10, 13; cf. DE 44-10 ¶¶ 67 (defining Sullivan as "his direct supervisor" at Woodbury); Id. ¶ 75 (referring to "Sullivan and other [unnamed] supervisors"). In still a third iteration, in his revised affidavit, plaintiff claims that he was supervised throughout his employment by both entities by the "same wealthy family [which] had the power to completely control Plaintiff's employment, including the ability to assign him job duties and hire and fire him." DE 44-10 ¶25 (providing that the family members both hired and fired him).
These affidavits, internally inconsistent and contradictory, prove insufficient to create a triable issue of fact. "It is well settled that the party opposing summary judgment may not create a triable issue of fact ‘merely by submitting an affidavit that disputes his own prior sworn testimony.’ " Rojas v. Roman Cath. Diocese of Rochester , 783 F. Supp. 2d 381, 406–07 (W.D.N.Y. 2010), aff'd 660 F.3d 98 (2d Cir. 2011) (collecting cases). Furthermore, "a party cannot attempt to defeat a summary judgment motion by contradicting factual allegations in his complaint." Id. at 407 (collecting cases). Here, worse than refuting allegations with averment, plaintiff submits contradictory sworn statements.
A second consideration also undermines plaintiff's arguments. The absence of evidence as to the supervisory structure of Owl's Nest prevents meaningful review of this question and means that plaintiff has failed to meet his evidentiary burden. Despite periods of time devoted to focused discovery, and the encouragement of two federal district judges, plaintiff opted – as a tactical matter – to neither serve a summons on Owl's Nest to effectively join it to the action nor serve a subpoena to obtain documents and information. Defendants correctly argue that these calculated decisions by plaintiff should not accrue to plaintiff's benefit. And, because plaintiff has the burden to establish the numerical requisites of Title VII to render Woodbury an employer, his failure to obtain competent proof to support his arguments of common management proves fatal to those arguments. Arculeo v. On-Site Sales & Mktg., LLC, 321 F. Supp. 2d 604, 607 (S.D.N.Y. 2004) ("In the Second Circuit, proof that an employer-defendant has fifteen or more employees is an essential element of the merits of a plaintiff's Title VII case.")
Finally, the evidence concerning the central factor, viz. , common control of labor relations, is insufficient to permit a trier of fact to find that Woodbury and Owl's Nest were a single employer. In determining the requisite degree of control over labor relations, the "critical question" is [w]hat entity made the final decisions regarding employment matters related to the person claiming discrimination?" Cook , 69 F.3d at 1240. It is undisputed that Sullivan hired, fired, disciplined, supervised, and otherwise controlled all aspects of labor relations at Woodbury. Indeed, it is undisputed that Sullivan hired plaintiff and terminated plaintiff's employment and that Owl's Nest was not involved with either decision. It is undisputed that Woodbury maintained workers’ compensation insurance and employment records for Woodbury employees in connection with their employment.
The only undisputed fact supporting the notion of common control of labor relations is the unceremonious transfer of several employees without application or interview process from Owl's Nest to Woodbury. While an unusual occurrence, this fact, standing alone, could be explained through circumstances other than common control of labor relations. Moreover, this event is further mitigated by the execution of employment contracts between each of those employees and Woodbury at the time they became employees of that entity. There is no evidence offered that the employees ever reverted to employment with Owl's Nest. Even assuming this weighs somewhat in plaintiff's favor, this attenuated showing fails to establish common control of labor relations, and certainly does not warrant a finding of a single enterprise.
Based on the foregoing, defendants’ motion for summary judgment as to plaintiff's Title VII claims is granted.
Remaining Claims
With the dismissal of plaintiff's FMLA and Title VII claims, no federal causes of action remain in this case. Plaintiff asserts a panoply of state law claims based upon his allegations over which the Court can exercise pendent jurisdiction under 28 U.S.C. § 1367. Defendants seek to have this matter dismissed in favor of proceedings in state court. The Court finds that judicial economy, convenience, fairness and comity weigh against retaining supplemental jurisdiction over the remaining state law claims. See Catzin v. Thank You & Good Luck Corp., 899 F.3d 77, 81 (2d Cir. 2018). Accordingly, the undersigned declines to exercise supplemental jurisdiction and plaintiff's state law claims are therefore dismissed without prejudice. Plaintiff may pursue any valid claim in state court.
CONCLUSION
Based on the foregoing, defendants’ motion for summary judgment as to the Title VII claims is granted, and the remaining state law claims are dismissed without prejudice.