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dismissing Bivens claim alleging violation of due process rights against a privately owned company; "[t]he Supreme Court has expressly 'foreclose[d] the extension of Bivens to private entities'"
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10 Civ. 4426 (PGG), 100603.
August 1, 2011
MEMORANDUM OPINION ORDER
Plaintiff Fred Pasternack's Amended Complaint alleges negligence, gross negligence, and fraud, and also asserts — pursuant to 42 U.S.C. § 1983 — that Defendants violated his rights under the Fourteenth Amendment. Plaintiff seeks to recover damages arising from Defendants' alleged misconduct in performing and evaluating a drug test.
Defendant ChoicePoint has moved to dismiss all claims against it in the Amended Complaint. For the reasons stated below, ChoicePoint's motion will be granted.
BACKGROUND
I. FEDERAL LAW GOVERNING THE DRUG TESTING OF AVIATION EMPLOYEES
Pasternack's claims relate to certain regulations promulgated by the Federal Aviation Administration ("FAA") and the U.S. Department of Transportation ("DOT") concerning the drug testing of aviation employees. The Second Circuit outlined the regulatory scheme in Drake v. Lab. Corp. of Am. Holdings, 458 F.3d 48 (2d Cir. 2006):
In the FAAct, Congress granted the FAA broad authority over aviation safety, including the power to adopt regulations that it "finds necessary for safety in air commerce and national security." 49 U.S.C. § 44701(a)(5). Pursuant to this power, in 1988, the FAA promulgated regulations mandating that all aviation-industry employees who perform safety-sensitive functions be subjected to random drug-testing. See Anti-Drug Program for Personnel Engaged in Specified Aviation Activities, 53 Fed. Reg. 47024 (Nov. 21, 1988) (codified as amended at 14 C.F.R. pt. 121, App. I). The regulations set forth in great detail the "standards and components" that required drug-testing programs must include. See 14 C.F.R. pt. 121, App. I. They prescribe, among other things, the classes of employees that must be tested, 14 C.F.R. pt. 121, App. I § III, the substances for which they must be tested, id. § IV, the types of testing to be conducted (e.g., pre-employment testing, random testing, and post-accident testing), id. § V, and the length of time that records of required drug testing must be retained, id. § VI.
The FAA regulations incorporate by reference DOT regulations that set out detailed protocols to be followed by drug-testing laboratories. See id. § I.B. (requiring that aviation employers comply with "Procedures for Transportation Workplace Drug Testing Programs," 49 C.F.R. pt. 40, published by the DOT). The DOT regulations provide, among other things, that laboratories must use chain-of-custody procedures to document each time a urine specimen is handled or transferred, see 49 C.F.R. § 40.83(b), that an employer's designated MRO [Medical Review Officer] must review and certify test results before the laboratory reports them to the employer, id. § 40.97(b); id. § 40.123, and that laboratories must report test results to an MRO in writing, id. § 40.97(b). Although they set out elaborate rules for conducting drug tests, the DOT regulations do not specifically address negligence on the part of drug-testing laboratories or otherwise establish the minimum standard of care to be exercised by laboratory personnel.Drake, 458 F.3d at 56-57.
The dispute between the parties concerns the consequences of Pasternack's initial failure to provide an adequate urine sample when randomly chosen for a drug test, and his decision to leave the collection facility before the collection process was complete. Two DOT regulations explicitly provide that where an employee leaves a collection site before the collection process is complete, that conduct constitutes a "refusal to test":
40.193 What happens when an employee does not provide a sufficient amount of urine for a drug test?
(a) This section prescribes procedures for situations in which an employee does not provide a sufficient amount of urine to permit a drug test (i.e., 45 mL of urine).
(b) As the collector, you must do the following:
(1) Discard the insufficient specimen, except where the insufficient specimen was out of temperature range or showed evidence of adulteration or tampering (see § 40.65(b) and (c)).
(2) Urge the employee to drink up to 40 ounces of fluid, distributed reasonably through a period of up to three hours, or until the individual has provided a sufficient urine specimen, whichever occurs first. It is not a refusal to test if the employee declines to drink. Document on the Remarks line of the CCF [Custody and Control Form] (Step 2), and inform the employee of, the time at which the three-hour period begins and ends.
(3) If the employee refuses to make the attempt to provide a new urine specimen or leaves the collection site before the collection process is complete, you must discontinue the collection, note the fact on the "Remarks" line of the CCF (Step 2), and immediately notify the DER [Designated Employer Representative]. This is a refusal to test.49 C.F.R. § 40.193 (emphasis added).
40.191 What is a refusal to take a DOT drug test, and what are the consequences?
(a) As an employee, you have refused to take a drug test if you:
. . .
(2) Fail to remain at the testing site until the testing process is complete. . . .49 C.F.R. § 40.191(a)(2).
II. Pasternack's Drug Test
Pasternack is a physician and part-time pilot for Northeastern Aviation Corporation ("Northeastern"). In 1978, Pasternack became a "Senior Aviation Medical Examiner" ("AME") for the FAA, a designation that authorized him to perform FAA-mandated medical examinations of pilots. (Am. Cmplt. ¶ 8) These examinations make up a large portion of his medical practice. (Am. Cmplt. ¶ 28)
Defendant ChoicePoint administers drug testing programs. (Am. Cmplt. ¶ 12) Defendant Laboratory Corporation of America ("Lab Corp.") performs drugs tests for employers and maintains sites to collect specimens for analysis. (Am. Cmplt. ¶¶ 5, 6, 9, 11, 15)
On June 1, 2007, Northeastern informed Pasternack that "ChoicePoint, Northeastern's agent for such purposes," had "randomly selected Pasternack [for drug testing] from [an] employee roster which Northeastern had provided to it." (Am. Cmplt. ¶ 13) Northeastern directed Pasternack to appear for drug testing at a Lab Corp. collection site. (Am. Cmplt. ¶ 14)
On June 5, 2007, Pasternack appeared for drug testing at a Lab Corp. collection site located at 1317 Third Avenue in Manhattan. (Am. Cmplt. ¶¶ 14, 16) He was unable to produce sufficient urine for testing purposes, and Lab Corp. employee Theresa Montalvo instructed Pasternack to wait in the waiting area. (Am. Cmplt. ¶¶ 17-18) Pasternack told Motalvo that he wished to leave, however, and would return the next morning to provide an adequate sample. Pasternack then left the collection site. (Am. Cmplt. ¶¶ 18-19)
Pasternack returned to the collection site three hours later. Montalvo spoke with Northeastern's general manager, "who authorized and approved the collection of Dr. Pasternack's urine sample." (Am. Cmplt. ¶ 20) Pasternack then provided an adequate specimen, which tested negative for drugs. (Am. Cmplt. ¶ 21) A "Custody and Control Form" ("CCF") concerning Pasternack's drug test was completed by Lab Corp. and signed by Pasternack. (Am. Cmplt. ¶¶ 14, 21) On the CCF, Montalvo indicated that "Pasternack had left the facility without providing a sufficient quantity of urine." (Am. Cmplt. ¶ 22) "Lab Corp. faxed the `completed' CCF to ChoicePoint on June 5, 2007." (Am. Cmplt. ¶ 173)
In signing the CCF, the testing subject certifies that the sample is his, that he provided it to the collector, that it has not been adulterated, that the bottle containing the specimen has been sealed with a tamper-evident seal in his presence, and that the information provided on the form and specimen bottle label is accurate. (Am. Cmplt. ¶ 21 n. 3)
The Amended Complaint alleges that the CCF contained the following notation: "pt left and returned." (Am. Cmplt. ¶¶ 181, 179 n. 8))
"On June 11, 2007, ChoicePoint faxed to Montalvo a form entitled `Memorandum for the Record — Problem Collections — Regulated DOT' and requested her to complete it." (Am. Cmplt. ¶ 175) On the form, Montalvo provided the following information concerning Pasternack's drug test:
. . . in a section entitled "Comments" Montalvo wrote that Pasternack had initially provided an insufficient sample, that she had telephoned his employer in connection with this insufficient sample, further noting that Pasternack "did not want to wait he wanted to come back," that at 4:16 p.m. Pasternack returned to the collection site "to complete the test," that she telephoned Pasternack's employer again, that Northeastern had approved the taking of this second specimen, and that thereafter "donor gave a sufficient specimen with a temperature."
(Am. Cmplt. ¶ 177)
As part of the drug testing administration services ChoicePoint provides to Northeastern, Dr. Melvin Samuels, a ChoicePoint medical review officer ("MRO") reviewed the CCF and test results concerning Pasternack's drug test. Based on the CCF, Dr. Samuels concluded "that Pasternack had left the facility without providing a sufficient quantity of urine" and "that Pasternack's leaving mandated a finding that Pasternack be designated a `refusal to test.'" (Am. Cmplt. ¶ 22) The Amended Complaint goes on to allege that "Dr. Samuels believed, and upon information and belief, believes that under the relevant statutes and regulations he was compelled to so conclude." (Am. Cmplt. ¶ 23)
Under DOT regulations, an MRO "is a licensed physician . . . who is responsible for receiving and reviewing laboratory results generated by an employer's drug testing program and evaluating medical explanations for certain drug test results." 49 C.F.R. § 40.3. "Federal regulations require aviation employers to appoint a licensed physician as an MRO to review drug test results on behalf of the employer." Drake v. Lab. Corp. of Am. Holdings, 458 F.3d 48, 53 n. 4 (2d Cir. 2006) (citing 49 C.F.R. § 40.123; 14 C.F.R. pt. 121 App. I § I.).
The Amended Complaint does not allege that ChoicePoint or Samuels communicated this determination to anyone.
On November 29, 2007, "the FAA revoked all of [Pasternack's] airm[a]n certificates," and on February 21, 2008, the FAA terminated his medical examiner designation, citing his "`unacceptable lack of regard for the importance of Federal Aviation Regulations'" and his "`refusal to take a random drug test.'" (Am. Cmplt. ¶ 25) "Pasternack appealed the termination of his [medical examiner] designation, but that appeal was denied." (Am. Cmplt. ¶ 26) He likewise appealed the revocation of his pilot certificates. (Am. Cmplt. ¶ 26) The Administrative Law Judge ("ALJ") upheld the revocation, however, as did a full board of the National Transportation Safety Board ("NTSB"). (Am. Cmplt. ¶ 26) Pasternack then appealed to the United States Court of Appeals for the District of Columbia. The D.C. Circuit found that the NTSB's determination was not supported by substantial evidence, vacated the decision, and remanded to the NTSB. (Am. Cmplt. ¶ 26)
"[T]he FAA grants permission to pilot aircraft through the issuance of airman certificates of various types. NTSB definitions provide that `[a]irman certificate' means any certificate issued by the FAA to an airman and shall include medical certificates required for an airman." Bullwinkel v. U.S. Dep't of Transp., FAA, 787 F.2d 254, 256 (7th Cir. 1986) (quoting 49 C.F.R. § 821.1) (citations omitted).
On September 2, 2010, the NTSB remanded the case to Chief ALJ William E. Fowler to "make, clarify and expound upon those credibility determinations, findings of fact, and conclusions of law that are pertinent to an assessment of whether respondent refused to undergo drug testing under 49 C.F.R. § 40.191." (See J. Randolph Babbitt, Administrator, Federal Aviation Administration v. Fred Leroy Pasternack, Decisional Order on Remand, Docket SE-18133RM at 2 (hereinafter "Apr. 8, 2011 ALJ Decision")) On the basis of a full evidentiary hearing, the ALJ affirmed the FAA administrator's order revoking Pasternack's airman certificates, concluding that he had "refused to take a DOT drug test under the provisions of 49 C.F.R. § 40.191(a)(2) on June 5, 2007" and "by virtue of his refusal . . . has demonstrated that he lacks the qualifications required to hold, and exercise the privileges of, any certificate or rating issued under [Federal Aviation Regulations] Part 61." (Apr. 8, 2011 ALJ Decision at 20-21)
In his findings of fact, the ALJ noted that Pasternack had served as an MRO for approximately 16 years, that he had received training on substance abuse from ChoicePoint in 2005, that "[s]uch training included instruction that leaving a drug testing facility without providing an adequate urine sample constitutes a drug test refusal," and that "[b]y virtue of both such training and his experience as an MRO, [Pasternack] knew or should have known that he was, under the applicable regulations, refusing a drug test when he departed the Lab Corp testing facility . . . on June 5, 2007." (Apr. 8, 2011 ALJ Decision at 20)
DISCUSSION
"To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to `state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 129 S. Ct. 1937, 1960 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. The plausibility standard is not akin to a probability requirement, but it asks for more than a sheer possibility that a defendant has acted unlawfully. Where a complaint pleads facts that are merely consistent with' a defendant's liability, it `stops short of the line between possibility and plausibility of entitlement to relief." Id. (quoting Twombly, 550 U.S. at 557 (internal quotations marks omitted)). "Determining whether a complaint states a plausible claim for relief [is] a context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id. at 1950.
Relying on Conley v. Gibson, 355 U.S. 41 (1957), Pasternack asserts that "[a] complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." (Pltf. Br. 1 (citations and internal quotation marks omitted))
The standard cited by Pasternack was explicitly abrogated inBell Atl. Corp. v. Twombly, 550 U.S. 544 (2007). As the Twombley court explained, "Conley's `no set of facts' language has been questioned, criticized, and explained away long enough. . . . The phrase is best forgotten as an incomplete, negative gloss on an accepted pleading standard: once a claim has been stated adequately, it may be supported by showing any set of facts consistent with the allegations in the complaint." Twombly, 550 U.S. at 562-63; see also Weinstein v. eBay, Inc., No. 10 Civ. 8310 (JFK), 2011 WL 2555861, at *2 (S.D.N.Y. June 27, 2011) ("Plaintiff mistakenly cites the Conley v. Gibson `no set of facts' standard in opposition to Defendants' motion to dismiss. However, the Supreme Court has made clear that `only a complaint that states a plausible claim for relief survives a motion to dismiss.'" (quoting Ashcroft v. Iqbal, 129 S. Ct. 1937, 1950 (2009))).
"In considering a motion to dismiss . . . the court is to accept as true all facts alleged in the complaint," Kassner v. 2nd Ave. Delicatessen Inc., 496 F.3d 229, 237 (2d Cir. 2007) (citing Dougherty v. Town of N. Hempstead Bd. of Zoning Appeals, 282 F.3d 83, 87 (2d Cir. 2002)), and must "draw all reasonable inferences in favor of the plaintiff." Id. (citing Fernandez v. Chertoff, 471 F.3d 45, 51 (2d Cir. 2006)). However, a court need not accept as true "[l]egal conclusions, deductions or opinions couched as factual allegations." In re NYSE Specialists Sec. Litig., 503 F.3d 89, 95 (2d Cir. 2007).
In determining the sufficiency of a complaint, this Court may consider "the factual allegations in [the] . . . complaint, . . . documents attached to the complaint as an exhibit or incorporated in it by reference, . . . matters of which judicial notice may be taken, [and] documents either in plaintiffs' possession or of which the plaintiffs had knowledge and relied on in bringing suit." Brass v. Am. Film Techs., Inc., 987 F.2d 142, 150 (2d Cir. 1993)); see also Chambers, 282 F.3d at 153 (documents that are "integral" to the complaint may be considered on motion to dismiss); Cortec Indus., Inc. v. Sum Holding L.P., 949 F.2d 42, 48 (2d Cir. 1991) (court may consider documents plaintiff relied on in framing the complaint).
I. PLAINTIFF HAS NOT PLED SUFFICIENT FACTS TO MAKE OUT A FRAUD CLAIM AGAINST CHOICEPOINT
ChoicePoint moves to dismiss Pasternack's fraud claim, arguing that he has failed to allege facts demonstrating that: (1) he relied on any misrepresentation or omission by ChoicePoint; or (2) ChoicePoint intended to defraud him. ChoicePoint also argues that Pasternack has not alleged fraud with particularity, as required by Fed.R.Civ.P. 9(b). (ChoicePoint Br. 1, 7, 8, 9)
"The elements of fraud under New York law are: `(1) a misrepresentation or a material omission of fact which was false and known to be false by defendant, (2) made for the purpose of inducing the other party to rely upon it, (3) justifiable reliance of the other party on the misrepresentation or material omission, and (4) injury.'" Premium Mortg. Corp. v. Equifax Info. Servs., LLC, 583 F.3d 103, 108 (2d Cir. 2009) (quoting Lama Holding Co. v. Smith Barney Inc., 88 N.Y. 2d 413, 421 (N.Y. 1996)).
"Claims of common law fraud must satisfy the requirements of Rule 9(b)." Healthcare Fin. Group, Inc. v. Bank Leumi USA, 669 F. Supp. 2d 344, 348 (S.D.N.Y. 2009) (citing Abercrombie v. Andrew Coll., 438 F. Supp. 2d 243, 274 (S.D.N.Y. 2006)). Rule 9(b) requires that a party alleging fraud "must state with particularity the circumstances constituting fraud or mistake," although "[m]alice, intent, knowledge, and other conditions of a person's mind may be alleged generally." Fed.R.Civ.P. 9(b). "To satisfy the requirements of Rule 9(b), the plaintiff must specify the statements contended to be fraudulent and the documents containing those statements; the time and place of each such fraudulent statement and the person who made (or in case of the omission did not make) the statement; and the content of the fraudulent statement, how it was misleading and the manner in which it was relied upon by the plaintiff." Nafta v. Feniks Int'l House of Trade (U.S.A.) Inc., 932 F. Supp. 422, 430 (E.D.N.Y. 1996) (citing Quintel Corp. v. Citibank, 589 F. Supp. 1235, 1243 (S.D.N.Y. 1984)); see also Bui v. Indus. Enters. of Am., Inc., 594 F. Supp. 2d 364, 373 (S.D.N.Y. 2009) ("Plaintiffs have not pled any of the elements of common law fraud with the requisite particularity; Plaintiffs' failure or refusal to specify any particular statement as allegedly fraudulent means that Plaintiffs are unable to allege that there has been `a material representation or omission of fact.'" (citing Dover Ltd. v. A.B. Watley, Inc., 423 F. Supp. 2d 303, 327 (S.D.N.Y. 2006)).
A. Failure to Allege Misrepresentations or Omissions By ChoicePoint on Which Plaintiff Relied 1. Applicable Law
"`The elements of fraud under New York law [include] . . . justifiable reliance of the other party on [a] misrepresentation or material omission. . . .'" Premium Mortg. Corp., 583 F.3d at 108 (quoting Lama Holding Co., 88 N.Y. 2d at 421). "A plaintiff's "fraud claims must be dismissed [where he has] failed to plead that [he] relied on [defendant's] false statements." Siotkas v. LabOne, Inc., 594 F. Supp. 2d 259, 275 (E.D.N.Y. 2009); see,e.g., Manning v. Utilities Mut. Ins. Co., Inc., 254 F.3d 387, 401 (2d Cir. 2001) ("[F]atal to the fraud claim is plaintiff's failure to allege reasonable reliance on such misrepresentations and that he suffered damages as a result. Nowhere in plaintiff's complaint does he allege that he reasonably and detrimentally relied on . . . the defendants.").
Even where reliance is properly pled, "the reasonableness of reliance is properly considered at the motion to dismiss stage."Terra Sec. Asa Konkursbo v. Citigroup, Inc., 740 F. Supp. 2d 441, 449 (S.D.N.Y. 2010); Stonepath Group, Inc., 343 F.3d at 195 ("For plaintiff to prevail on [common law fraud], it has to establish reasonable reliance on the alleged misrepresentations or omissions." (citations omitted)); Abu Dhabi Commercial Bank v. Morgan Stanley Co., Inc., 651 F. Supp. 2d 155, 180-81 (S.D.N.Y. 2009). "New York law requires that plaintiffs alleging common law fraud establish reasonable reliance on a material misrepresentation. A plaintiff must demonstrate that there was some basis for it to have relied on the alleged misstatement or omission." Terra Sec. Asa Konkursbo, 740 F. Supp. 2d at 448 (citing Schlaifer Nance Co. v. Estate of Warhol, 119 F.3d 91, 98 (2d Cir. 1997)).
2. Analysis
Here, Pasternack's fraud claim against ChoicePoint must be dismissed because the Amended Complaint does not set forth misrepresentations or omissions by ChoicePoint on which he reasonably relied. At best, Pasternack alleges that Dr. Samuels erred in concluding that Pasternack's departure from the collection site constituted a "refusal to test" under DOT regulations. These allegations, set forth below, are not sufficient to make out a fraud claim:
Despite LabCorp's utter refusal to characterize Pasternack's drug test as anything other than completely routine and proper (aside from its addition of the secretly coded phrase "pt left and returned" on the CCF) ChoicePoint, through its employee, Dr. Melvin Samuels, then, arbitrarily, based upon its own idiosyncratic predilections, and without regulatory authority, determined that the fact that Pasternack had left the testing site — even with the explicit permission and authorization of his employer and LabCorp, through Montalvo — "required" it to find that Pasternack had been a "refusal to test."
(Am. Cmplt. ¶ 179)
In so doing, ChoicePoint committed a fraud against Pasternack because in order to "properly" process Pasternack's CCF, it needed his signature on the form. In arbitrarily deeming Pasternack a "refusal to test" it wrongfully and willfully distorted his signature on the CCF to indicate that Pasternack agreed that he had refused to test when, in fact, Pasternack signed the CCF believing he had properly and completely completed this drug test.
(Am. Cmplt. ¶ 180)
Additionally, ChoicePoint committed a fraud against Pasternack by failing to contact Northeastern and/or Pasternack before recklessly determining that the four (4) cryptic words "pt left and returned" were sufficient to permit it to designate Pasternack's test as a `refusal to test' when it indisputably knew that neither LabCorp nor Pasternack had acknowledged that Pasternack's drug test was anything less than proper and complete.
(Am. Cmplt. ¶ 181)
Pasternack relied upon ChoicePoint to read and interpret his CCF fairly and in accordance with 49 CFR Part 40 as well as the established tenets of due process.
(Am. Cmplt. ¶ 182)
This gibberish is not sufficient to make out a claim of reasonable reliance on a misrepresentation or omission of fact by ChoicePoint. Plaintiff has pled no facts suggesting that ChoicePoint had any direct contact with Pasternack, nor has Plaintiff identified what misrepresentations or misleading statements ChoicePoint made to Pasternack on which he reasonably relied. To the extent that the Amended Complaint cites misrepresentations or omissions, that alleged conduct was committed by Lab Corp. employees at the collection facility. (See, e.g., Am. Cmplt. ¶¶ 46, 127, 130, 154, 159). The Amended Complaint likewise does not allege that Pasternack took any action based on anything a ChoicePoint employee said or did. Because Pasternack has neither identified the misrepresentations or otherwise misleading statements ChoicePoint made to him, nor pleaded facts demonstrating reliance on such statements, his fraud claim against ChoicePoint must be dismissed.
B. Failure to Allege Scienter
"To establish scienter[,] plaintiff must show an intentional or reckless misstatement made with the intent that plaintiff rely upon it." Brown v. Stinson, 821 F. Supp. 910, 914 (S.D.N.Y. 1993). Showing "that the defendants had . . . knowledge of the falsity, or a reckless disregard for the truth," Connecticut Nat. Bank v. Fluor Corp., 808 F.2d 957, 962 (2d Cir. 1987), suffices because "a plaintiff realistically cannot be expected to plead a defendant's actual state of mind." Conn. Nat'l Bank v. Fluor Corp., 808 F.2d 957, 962 (2d Cir. 1987).
Here, the Amended Complaint alleges that:
ChoicePoint committed a fraud against Pasternack by failing to contact Northeastern and/or Pasternack before recklessly determining that the four (4) cryptic words "pt left and returned" were sufficient to permit it to designate Pasternack's test as a "refusal to test" when it indisputably knew that neither LabCorp nor Pasternack had acknowledged that Pastemack's drug test was anything less than proper and complete.
(Am. Cmplt. ¶ 181)
The Amended Complaint does not allege facts suggesting that ChoicePoint's made any misstatements to Pasternack with knowledge of their falsity or with reckless disregard of their truth. Instead, the Amended Complaint alleges that ChoicePoint's MRO was told that Pasternack "le[ft] the collection site before the collection process [was] complete," and that the MRO concluded that Plaintiff's conduct constituted "a refusal to test" under 49 C.F.R. § 40.193(b)(3). Far from pleading scienter, the Amended Complaint pleads the opposite: "Dr. Samuels believed . . . that under the relevant statutes and regulations he was compelled to . . . conclude" "that Pasternack's leaving mandated a finding that Pasternack be designated a `refusal to test.'" (Am. Cmplt. ¶¶ 22, 23) Based on the facts pleaded in the Amended Complaint, there is no basis for finding that any statements made by Dr. Samuels were made with knowledge of falsity or with reckless disregard of their truth.
For all these reasons, Pasternack's fraud claim against ChoicePoint will be dismissed.
II. THE AMENDED COMPLAINT DOES NOT PLEAD A PLAUSIBLE NEGLIGENCE CLAIM AGAINST CHOICEPOINT
A. General Negligence Law
"Under New York law, which applies to this case, `a plaintiff must establish three elements to prevail on a negligence claim: (1) the existence of a duty on defendant's part as to plaintiff; (2) a breach of this duty; and (3) injury to the plaintiff as a result thereof.'" Farash v. Cont'l Airlines, Inc., 574 F. Supp. 2d 356, 367 (S.D.N.Y. 2008) (quoting Alfaro v. Wal-Mart Stores, Inc., 210 F.3d 111, 114 (2d Cir. 2000)).
"The existence of a duty is an essential element of a negligence claim because, `[i]n the absence of a duty, as a matter of law, no liability can ensue.'" Farash, 574 F. Supp. 2d at 367 (quoting McCarthy v. Olin Corp., 119 F.3d 148, 156 (2d Cir. 1997)). "A plaintiff must show more than a duty owed to a potentially limitless class of people, but rather a specific duty owed to the plaintiff." Gen. Star Indem. Co. v. Platinum Indem. Ltd., No. 00 CIV. 4960 (LMM) (GWG), 2002 WL 31159106, at *3 (S.D.N.Y. Sept. 27, 2002) (citing Hamilton v. Beretta U.S.A. Corp., 96 N.Y.2d 222, 232 (N.Y. 2001) ("injured party must show that a defendant owed not merely a general duty to society but a specific duty to him or her"); Lauer v. City of New York, 95 N.Y.2d 95, 100 (N.Y. 2000) ("[w]ithout a duty running directly to the injured person there can be no liability in damages, however careless or foreseeable the harm")). As the Second Circuit has emphasized, "in New York . . . `the judicial power to modify the general rule' of ordinary care `is reserved for very limited situations' and is not to be `exercise[d] . . . on an ad hoc basis.'" Alfaro, 210 F.3d at 115 (quoting Stagl v. Delta Airlines, Inc., 52 F.3d 463, 469 (2d Cir. 1995)).
The scope of the duty owed to a plaintiff is a question of law,see Palka v. Servicemaster Mgmt. Servs. Corp., 83 N.Y.2d 579, 585 (N.Y. 1994) ("the definition of the existence and scope of an alleged tortfeasor's duty is usually a legal, policy-laden declaration reserved for judges to make prior to submitting anything to fact-finding or jury consideration" (citations omitted)). The determination of whether a party breached its duty of care may also be decided as a matter of law. See Alfaro, 210 F.3d at 116 ("we hold that Wal-Mart's alleged breach — failing to assist Alfaro in a timely manner — was outside the scope of its duty to Alfaro); see also Blye v. Manhattan Bronx Surface Transit Operating Auth., 124 A.D.2d 106, 109 (1st Dept 1987) ("Whether or not in a given case a breach of duty has occurred will depend on the particular facts of the case and is either a question of law or of fact depending on the susceptibility of the facts to varying inferences. The facts at bar, which are not susceptible to varying interpretations, enable us to determine, as a matter of law, whether a breach of duty of care has occurred." (citingSheehan v. City of New York, 40 N.Y.2d 496, 502 (N.Y. 1976);Palsgraf v. Long Island Railroad Company, 248 N.Y. 339, 345 (N.Y. 1928); Amoruso v. New York City Transit Authority, 12 A.D.2d 11, 12 (1st Dept 1960)).
B. Negligence Law As Applied To Drug Testing Entities: The Drake Trilogy
In support of his negligence claim, Pasternack cites three related cases addressing the liability of drug testing laboratories and MROs for negligence in conducting and evaluating drug tests: Drake v. Lab. Corp. of Am. Holdings, 290 F. Supp. 2d 352 (E.D.N.Y. 2003) ("Drake I"), Drake v. Lab. Corp. of Am. Holdings, 458 F.3d 48 (2d Cir. 2006) ("Drake II"), and Drake v. Lab. Corp. of Am. Holdings, No. 02-CV-1924 (FB) (RML), 2007 WL 776818 (E.D.N.Y. Mar. 13, 2007) ("Drake III").
Richard Drake was a Delta Airlines flight attendant who was terminated after he purportedly failed a random drug test. Drake I, 290 F. Supp. 2d at 353. "The complaint describe[d] a complicated series of events following the urine collection, in which each of the defendants allegedly violated federal drug-testing protocols," failed to maintain records required by federal law regarding the chain of custody for Drake's urine specimen and "tampered with the sample," and "thereby contributed to Delta's ultimate, erroneous conclusion that Drake's urine sample contained [a substance justifying his termination]." Drake II, 458 F.3d at 52-53. Defendant Dr. William Whaley, the MRO, allegedly sent someone else's urine sample to a toxicology laboratory, but claimed that the sample had been obtained from Drake. Whaley also allegedly approved an unlawful re-test of Drake's alleged urine sample, and "`accepted the false and improper results of the . . . purported re-test and transmitted the results to Delta,'" leading to Drake's suspension and eventual termination. Drake I, 290 F. Supp. 2d at 356-57. Drake brought an action for negligence, alleging that he was entitled to relief under state law for the defendants' alleged violations of federal regulations. Defendants moved to dismiss, arguing that the state law claims were preempted by federal statutes and regulations.
The district court denied the motion to dismiss but certified the preemption issue for interlocutory appeal. Id. at 363. The Second Circuit concluded "that Drake's state tort claims [were] preempted to the extent that he assert[ed] that the defendants-appellants violated state common-law drug-testing standards that [were] independent of federal law. But Drake's claims [were] not preempted insofar as he allege[d] that the defendants-appellants engaged in wrongful behavior not addressed by federal law, or insofar as his state-law causes of action do no more than provide remedies for violations of the federal regulations." Drake II, 458 F.3d at 52. Stated another way, the court ruled that to the extent Drake was "asserting that conduct addressed by the federal regulations is `wrongful' under state law although it does not violate federal regulations, such claims are preempted." Id. at 65.
Because Drake claimed, "[i]n each of his state-law counts . . . that he [was] entitled to relief under state law for the defendant-appellants' alleged violations of federal regulations," and "[b]ecause remedies are not addressed by the FAA regulations," the court ruled that Drake's negligence and other state law claims were not fully preempted, and affirmed the district court's order denying the motion to dismiss. Id. at 63-65. The Second Circuit emphasized, however, that "[a]lthough . . . Drake [could] seek state-law remedies for violations of the federal regulations . . . state law cannot `enlarg[e] or enhanc[e]' the regulations to impose burdens more onerous than those of the federal requirements on matters addressed by the federal regulations." Id. (quoting American Airlines, Inc. v. Wolens, 513 U.S. 219, 233 (1995) (first and second alterations added).
On remand, the defendants — including the MRO — filed a second Rule 12(b)(6) motion to dismiss Drake's negligence claim. Although the District Court acknowledged that that "[t]he New York Court of Appeals has not had occasion to determine whether a drug-testing facility owes a duty of care to a non-contracting employee," the court nonetheless found that the complaint's allegations were "sufficient to support a claim of negligence under either (1) the district courts' interpretation of the duty of care owed under New York law, see Coleman [v. Town of Hempstead, 30 F. Supp. 2d 356, 365 (E.D.N.Y. 1999)]; Santiago [v. Greyhound Lines, Inc., 956 F. Supp. 144, 153 (N.D.N.Y. 1997)], or (2) the First Department's holding in Fernandez [v. Otis Elev. Co., 4 A.D.3d 69, 73 (1st Dept 2004)]." Accordingly, defendants' motion to dismiss was denied. Drake III, 2007 WL 776818, at *2-3.
In Coleman, the district court denied Defendant Lab Corp.'s motion to dismiss the plaintiff's negligence claim, and found a duty of care, where Lab Corp. had allegedly failed to maintain the seal on plaintiff's urine specimen, which had tested positive for drugs. Coleman, 30 F. Supp. 2d at 359, 363-66. In Santiago, the court denied summary judgment on a negligence claim where a doctor's assistant had collected the employee's urine sample but "neglected to have plaintiff initial the bottle or complete the chain of custody form." The employee was later fired after a laboratory reported that his urine sample — contained in a bottle on which the employee's signature had been forged — contained cocaine. The court concluded that the doctor "had a duty to Santiago to collect his specimen with due care."Santiago, 956 F. Supp. at 146, 153. Finally, in Fernandez, the First Department considered whether Otis Elevator Co. owed a duty of care to plaintiff — a janitor — who fell down an elevator shaft, where Otis had entered into an elevator maintenance contract with plaintiff's employer. Fernandez, 4 A.D.3d at 71-72.
The First Department noted that "[w]hile `a contractual obligation, standing alone, will generally not give rise to tort liability in favor of a third party,'" the
Court of Appeals has identified three circumstances in which a duty of care to non-contracting third parties may arise out of the contractual obligation or the performance thereof . . .: (1) where the contracting party, in failing to exercise reasonable care in the execution of the contract, creates an unreasonable risk of harm to others, or exacerbates that risk; (2) where a plaintiff detrimentally relies on the defendant's continued performance of a contractual obligation; and (3) where the contracting party comprehensively agrees to assume and displace the promisee's safety-related obligations.Fernandez, 4 A.D.3d at 73 (quoting and citing Espinal v Melville Snow Contrs., 98 N.Y.2d 136, 140 (N.Y. 2002)).
The Fernandez court relied on the New York Court of Appeals' decision in Espinal v. Melville Snow Contrs., 98 N.Y.2d 136 (2002) for its formulation of the "unreasonable risk of harm" exception. The test articulated in Espinal is more restrictive, however:
a party who enters into a contract to render services may be said to have assumed a duty of care — and thus be potentially liable in tort — to third persons: (1) where the contracting party, in failing to exercise reasonable care in the performance of his duties, "launche[s] a force or instrument of harm." Moch Co. v Rensselaer Water Co., 247 N.Y. 160, 168 (N.Y. 1928); (2) where the plaintiff detrimentally relies on the continued performance of the contracting party's duties, see Eaves Brooks Costume Co. v Y.B.H. Realty Corp., 76 N.Y.2d 220, 226 (N.Y. 1990); and (3) where the contracting party has entirely displaced the other party's duty to maintain the premises safely. See Palka v Servicemaster Mgmt. Servs. Corp., 83 N.Y.2d 579, 589 (N.Y. 1994).Espinal, 98 N.Y.2d at 140 (emphasis added).
The First Department dismissed plaintiff's negligence claim, finding that Otis owed plaintiff no duty of care, because "[n]one of these exceptions applies to these facts." Id. As to the "unreasonable risk of harm" exception, the court noted that Otis had offered evidence "showing that it [had] complied with the contract," and that "there is no evidence that [the elevator company] created or exacerbated any risk to plaintiff by failing to adequately perform its obligations under its service contract with the [employer]." Id. C. Plaintiff's Negligence Claims Against ChoicePoint
Pasternack alleges that ChoicePoint breached its duty to him by failing to comply with a host of very generally-worded DOT regulations concerning the drug testing process. For example, Pasternack claims that ChoicePoint breached its duty to him "by failing to be knowledgeable about 49 CFR Part 40, Subpart G and Subpart I" (Am. Cmplt. ¶ 185), which, respectively, address "Medical Review Officers and the Verification Process" and "Problems in Drug Tests." See 49 C.F.R. §§ 40.121-40.169, 40.191-40.209. The Amended Complaint goes on to allege that ChoicePoint breached its duty to Pasternack by failing to
(1) "instruct and train its MROs to properly interact with urine collectors and with employers and by failing to require its MROs to be familiar with `DOT agency rules, guidance, interpretations, and policies affecting the performance of MRO functions'" (Am. Cmplt. ¶ 186 (quoting 49 C.F.R. § 40.121(c)(1)(v) and (vi)));
(2) "`advocate for the accuracy and integrity of the drug testing process'" (Am. Cmplt. ¶ 187 (quoting 49 C.F.R. § 40.123(a)));
(3) "provide Pasternack with a proper `quality assurance review' in connection with his CCF" (Am. Cmplt. ¶ 188 (citing 49 C.F.R. § 40.123(b)));
(4) "properly and completely `investigate' the facts surrounding the collection and testing of Pasternack's urine sample" (Am. Cmplt. ¶ 189 (citing 49 C.F.R. § 123(c)));
(5) "notify either Northeastern and/or Pasternack about its concerns and questions regarding the information provided on Pasternack's CCF" (Am. Cmplt. ¶ 190 (citing 49 C.F.R. § 123(c)));
(6) "`perform all [its] functions in compliance with this part and other DOT agency regulations" (Am. Cmplt. ¶ 191 (citing 49 C.F.R. § 40.123(h)));
(7) "`take all practicable action to correct [a] problem so that the test is not cancelled'" (Am. Cmplt. ¶ 192 (citing 49 C.F.R. § 40.205(b)));
Pasternack also contends that
ChoicePoint breached its duty to [him] under 49 CFR § 40.209(b) by cancelling his second urine test "based on an error that does not have a significant adverse effect on the right of the employee to have a fair and accurate test", — that is, based upon an arbitrary and idiosyncratic determination that a procedural irregularity destroyed the integrity of the urine sample Pasternack provided.
(Am. Cmplt. ¶ 196)
Finally, Pasternack alleges that "[i]n violating these regulation sections, ChoicePoint wrongfully designated Pasternack as a `refusal to test' on the CCF, which designation, in turn, was solely responsible for the FAA's revocation of Pasternack's airm[a]n certificates as well as his AME designation." (Am. Cmplt. ¶ 197)
D. Analysis Drake II indicates that federal law does not preempt a state law negligence claim against a drug testing entity or administrator where the plaintiff seeks to recover for alleged violations of federal regulations. Because Pasternack's negligence claims are predicated on ChoicePoint's alleged violations of DOT regulations, those claims are not preempted by federal law. His negligence claims suffer from multiple other defects, however.
As an initial matter, the Amended Complaint does not allege that ChoicePoint or Dr. Samuels communicated the "refusal to test" determination to anyone. Accordingly, it is entirely unclear what action ChoicePoint took that damaged Pasternack.
Secondly, the duty of care discussed in Drake III, Santiago,Coleman, Fernandez, and Espinal arises from a contractual relationship between a service provider and an employer. Here, the Amended Complaint does not allege that ChoicePoint had a contractual relationship with Pasternack's employer, Northeastern Aviation Corp. Accordingly, the initial factual predicate for finding a duty of care is not present here, and its absence requires dismissal of Pasternack's negligence claims.
Assuming arguendo that Pasternack could plead facts demonstrating that (1) ChoicePoint communicated its "refusal to test" determination to someone; (2) that this communication caused harm to Pasternack; and (3) there was a contractual relationship between ChoicePoint and Northeastern, a finding that Dr. Samuels — ChoicePoint's MRO — had a duty of care to Pasternack arising out of his obligation to properly interpret the DOT regulation regarding a "refusal to test," would represent a significant extension of precedent. Drake III, Santiago, andColeman all involve a direct mishandling of plaintiff's urine specimen: in Drake III, the MRO allegedly sent the wrong sample to the laboratory; in Coleman, Lab Corp. allegedly failed to maintain the seal on plaintiff's urine sample; and in Santiago, the defendant doctor did not properly label the specimen and did not maintain chain of custody. Here, the Amended Complaint does not allege that ChoicePoint in any way mishandled Pasternack's urine sample. Instead, Pasternack claims that ChoicePoint's MRO misinterpreted a DOT regulation. Pasternack has not cited any law demonstrating that such a misinterpretation can provide the basis for a negligence claim.
Finally, assuming arguendo that Pasternack could plead facts showing that a contract existed between Northeastern and ChoicePoint, that ChoicePoint breached that contract, and that in breaching the contract ChoicePoint violated a duty of care to Pasternack not to misinterpret the DOT regulation governing a "refusal to test," the Amended Complaint fails to articulate a plausible theory as to how ChoicePoint misinterpreted the "refusal to test" regulation. See Iqbal, 129 S. Ct. at 1949.
While the Amended Complaint asserts that ChoicePoint violated numerous federal regulations, the method by which it allegedly violated those regulations involves solely the MRO's determination that Pasternack's conduct constitutes a "refusal to test." The applicable federal regulations, however, explicitly provide that where an employee leaves a collection site before the collection process is complete, that conduct constitutes a "refusal to test."
For example, 49 C.F.R. § 40.191(a)(2) states that "[a]s an employee, you have refused to take a drug test if you . . . [f]ail to remain at the testing site until the testing process is complete." Similarly, 49 C.F.R. § 40.193 provides that "[i]f the employee . . . leaves the collection site before the collection process is complete. . . . [t]his is a refusal to test."
While Pasternack alleges that MRO Samuels made "an arbitrary and idiosyncratic determination" in concluding that Pasternack's departure from the collection site constituted a "refusal to test" (Am. Cmplt. ¶ 196), the plain language of the applicable regulations requires such a determination. Pasternack has not presented a plausible theory as to how MRO Samuels' determination constitutes a misinterpretation of these regulations, much less that he was negligent in making this determination.
For all these reasons, Pasternack's negligence claim against ChoicePoint will be dismissed.
The Amended Complaint also contains a claim against ChoicePoint for gross negligence. (Am. Cmplt. ¶¶ 207-14). However, "[b]ecause plaintiff has failed to make out a claim for ordinary negligence, his claim for gross negligence must necessarily fail." Farash v. Cont'l Airlines, Inc., 574 F. Supp. 2d 356, 368 (S.D.N.Y. 2008).
III. PLAINTIFF'S SECTION 1983 CLAIM WILL BE DISMISSED
ChoicePoint has moved to dismiss Pasternack's Section 1983 claim, which is premised on the assertion that ChoicePoint violated Pasternack's due process rights while "act[ing] as an agent of the United States Department of Transportation, and [while] act[ing] under its authority." (Am. Cmplt. ¶¶ 217, 220)
A. Applicable Law
Title 42, U.S.C. § 1983 provides, in relevant part:
Every person who, under color of any statute, ordinance, regulation, custom, or usage, of any State or Territory or the District of Columbia, subjects, or causes to be subjected, any citizen of the United States or other person within the jurisdiction thereof to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress. . . .
"In order to establish individual liability under § 1983, a plaintiff must show (a) that the defendant is a `person' acting `under the color of state law,' and (b) that the defendant caused the plaintiff to be deprived of a federal right." Back v. Hastings On Hudson Union Free Sch. Dist., 365 F.3d 107, 122 (2d Cir. 2004); see also Sutton v. N.Y. City Transit Auth., No. 02-CV-1441 (RRM) (JO), 2009 WL 5092989, at *5 (E.D.N.Y. Sept. 30, 2009) (citing Velez v. Levy, 401 F.3d 75, 84 (2d Cir. 2005)).
"[A] Bivens action is the `federal analog to suits brought against state officials under . . . 42 U.S.C. § 1983.'" Delgado v. Bezio, No. 09 Civ. 6899 (LTS), 2011 WL 1842294, at *9 (S.D.N.Y. May 9, 2011) (quoting Iqbal, 129 S.Ct. at 1948)). InBivens v. Six Unknown Named Agents of the Fed. Bureau of Narcotics, 403 U.S. 388 (1971), "the Supreme Court held that plaintiffs could recover damages for constitutional violations committed by persons acting under the color of federal law."Hamilton v. Shanahan, No. 09 Civ. 6869 (SAS), 2009 WL 5173927, at *4 n. 49 (S.D.N.Y. Dec. 30, 2009) (citing Bivens, 403 U.S. 388). "A Bivens action is intended to be one in which federal agents, as individuals, are liable for damages resulting from their actions taken under color of law." Haughton v. Burroughs, No. 98 Civ. 3418 (BSJ), 2004 WL 330242, at *3 (S.D.N.Y. Feb. 23, 2004) (citing Bivens, 403 U.S. at 395-96).
"To determine whether a defendant has acted under color of federal law for purposes of a Bivens action, courts look to the more established body of law that defines the analogous term — under color of state law — with regard to actions under 42 U.S.C. § 1983. `Courts of Appeals have held that section 1983 concepts of state action apply in determining whether action was taken `under color of federal law' for Bivens purposes.'" Bender v. Gen. Servs. Admin., 539 F. Supp. 2d 702, 707 (S.D.N.Y. 2008) (quoting Chin v. Bowen, 833 F.2d 21, 24 (2d Cir. 1987)).
However, "Bivens actions may not be brought against private corporations, even when they act under the color of federal law."Bender, 539 F. Supp.2d at 708. In Corr. Servs. Corp. v. Malesko, 534 U.S. 61, 66 n. 2 (2001), the Supreme Court held that FDIC v. Meyer, 510 U.S. 471 (1994) "forecloses the extension of Bivens to private entities." Malesko, 534 U.S. at 66 n. 2 ("The Courts of Appeals have divided on whether FDIC v. Meyer, 510 U.S. 471 (1994), forecloses the extension of Bivens to private entities. We hold today that it does."); see also Haughton, 2004 WL 330242, at *4 ("Bivens does not allow a private right of action against a private corporation for alleged constitutional deprivations." (citations omitted)). The Supreme Court found the "core premise of Bivens to be the deterrence of individual officers who commit unconstitutional acts, and that such deterrence would be undermined by an application of Bivens to corporate defendants.Bender, 539 F. Supp.2d at 708 (emphasis in original) (citations and internal quotations omitted).
B. Analysis
Recognizing his pleading error, Pasternack sub silentio attempts to convert his Section 1983 claim into a "Bivens action," referring to his "Section 1983/Bivens claim" in his opposition brief. (See Pltf. Br. 20-24) The Amended Complaint contains no mention of Bivens, however, and "`it is axiomatic that the Complaint cannot be amended by the briefs in opposition to a motion to dismiss.'" Lindner v. Am. Exp. Co., No. 10 Civ. 2228 (JSR) (JLC), 2011 WL 2581745, at *9 (S.D.N.Y. June 27, 2011) (quoting O'Brien v. Nat'l Prop. Analysts Partners, 719 F. Supp. 222, 229 (S.D.N.Y. 1989)).
Even if this Court construed Pasternack's Section 1983 claim as a Bivens action, however, dismissal would still be required. The Supreme Court has expressly "foreclose[d] the extension of Bivens to private entitles." Malesko, 534 U.S. at 66 n. 2; see also Orellana v. World Courier, Inc., No. 09-CV-576 (NGG) (ALC), 2010 WL 3861013, at *2 (E.D.N.Y. Sept. 28, 2010) ("Bivens only provides a cause of action against individual federal officers, not private entities." (citations omitted)); Orellana v. World Courier, Inc., No. 09-CV-576 (NGG) (ALC), 2010 WL 3023528, at *2 (E.D.N.Y. July 29, 2010) ("[t]he United States Supreme Court has made clear that Bivens does not confer a right of action for damages against private entities acting under color of federal law." (citations and internal quotations marks omitted)); Taggart v. Moody's Investors Serv., Inc., No. 06 Civ. 3388 (PKC), 2007 WL 2076980, at *4 (S.D.N.Y. July 17, 2007) ("the Supreme Court rejected the extension of Bivens-type actions to private corporate entities"); see also Bender, 539 F. Supp.2d at 708 ("Bivens actions may not be brought against private corporations, even when they act under the color of federal law.").
In sum, Pasternack's Section 1983 claim must be dismissed because there is no claim that ChoicePoint acted under color of state law. To the extent this claim could be construed as aBivens action, it will be dismissed, because a Bivens action will not lie against a private entity such as ChoicePoint.
Pasternack contends that "[s]hould . . . the court here be constrained to dismiss Dr. Pasternack's 1983/Bivens count because his claims have been alleged against ChoicePoint, a corporation, and not against its individual employees, Dr. Pasternack should be permitted to amend his complaint to name and aver against specific individuals." (Pltf. Br. 24) "Although under Rule 15(a) of the Federal Rules of Civil Procedure leave to amend complaints should be `freely given,' leave to amend need not be granted where the proposed amendment is futile." Murdaugh v. City of New York, No. 10 Civ. 7218 (HB), 2011 WL 1991450, at *2 (S.D.N.Y. May 19, 2011) (citing Forman v. Davis, 371 U.S. 178, 182 (1962); Min Jin v. Metro. Life Ins. Co., 310 F.3d 84, 101 (2d Cir. 2002)).
Here, Pasternack's proposed amendment would appear to be futile. His argument amounts to an assertion that because ChoicePoint is subject to extensive federal regulation, its employees are federal actors. (See Pltf. Br. 21-22) Extensive regulation does not make the employees of an entity governmental actors, however. See Jackson v. Metropolitan Edison Co., 419 U.S. 345, 350 (1974) ("The mere fact that a business is subject to state regulation does not by itself convert its action into that of the State for purposes of the Fourteenth Amendment. Nor does the fact that the regulation is extensive and detailed. . . .");Leeds v. Meltz, 85 F.3d 51, 54 (2d Cir. 1996) ("Extensive regulation and public funding, either alone or taken together, will not transform a private actor into a state actor; instead, the state must have exerted its coercive power over, or provided significant encouragement to, the defendant before the latter will be deemed a state actor."); Croy v. A.O. Fox Mem'l Hosp., 68 F. Supp. 2d 136, 142 (N.D.N.Y 1999) ("The mere fact that [the State] regulates the facilities and standards of care of private hospitals does not per se make the acts of the hospital . . . the acts of the state.") (alterations in original); Corrente v. St. Joseph's Hosp. Health Ctr., 730 F. Supp. 493, 500 (N.D.N.Y. 1990) ("extensive state or federal regulation of a private institution does not in itself create state action").
CONCLUSION
For the reasons stated above, Defendant ChoicePoint's motion to dismiss is GRANTED. The Clerk of the Court is directed to terminate the motion [Docket No. 16] and to terminate ChoicePoint as a defendant.SO ORDERED.