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STREIT v. BUSHNELL
424 F.Supp.2d 633 (2006)
United States District Court, S.D. New York.
March 23, 2006.
III. DISCUSSIONIn response to Streit's breach of contract, quantum meruit and unjust enrichment causes of action, Bushnell contends that those claims are barred by the New York Statute of Frauds or by the applicable statute of limitations. In particular, Bushnell takes issue with the absence of specifics from Streit's pleadings, challenges facts that Streit alleges and that Bushnell denies or maintains Streit did not describe accurately, and points to inconsistencies Bushnell finds between statements contained in the Original and First Amended Complaints.4 For instance, Bushnell chides Streit because, though he claims professional experience in the entertainment industry and alleges having
been Bushnell's manager and involved in the HBO deal, "Streit cannot even state what the terms of the agreement are, alleging only `upon information and belief what he believes the general terms to be." (Def.'s Mem. at 6.) On this point, Bushnell adds incidentally that Streit "is incorrect in his understanding of the deal." (Id. at 6 n. 6.) In a similar vein, Bushnell notes that while Streit purported to have served as her manager, both the Original and the First Amended Complaint "are tellingly silent as to what `management' activities [] Streit performed on [] Bushnell's behalf." (Id. at 11.) Relying on New York General Obligations Law ("NYGOL") § 5-701(a)(10), which requires that contracts relating to negotiating the purchase or sale of a business opportunity be in writing,5 Bushnell maintains that the oral agreement upon which Streit's action is grounded cannot withstand a motion to dismiss because "[a] failure to assert the elements of a claim and the facts to support the same should result in the cause of action being dismissed." (Def.'s Mem. at 8) (citing A.V. By Versace, Inc. v. Gianni Versace, S.p.A.,160 F.Supp.2d 657, 667 (S.D.N.Y.2001)). The Court need not address these arguments in any extensive detail. For, Bushnell's motion, though acknowledging the proper standard, nonetheless urges an unduly constricted reading of Streit's pleadings, is premised on a flawed application of Rule 12(b)(6) jurisprudence, and rests fundamentally upon a misconception of relevant state law doctrine. In reviewing a complaint for legal sufficiency for the purposes of adjudicating a Rule 12(b)(6) motion, the Court's point of departure is Rule 8(a)(2). Pursuant to the liberal pleading requirements of the Federal Rules of Civil Procedure, a plaintiff need provide only "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed.R.Civ.P. 8(a)(2). Bushnell's proposition that the pleadings must contain allegations reflecting each of the material elements of a viable cause of action rests upon a doctrine specifically repudiated by the Supreme Court in Swierkiewicz v. Sorema N.A.,534 U.S. 506, 512, 122 S.Ct. 992, 152 L.Ed.2d 1 (2002). Rejecting such a heightened test as inconsistent with Rule 8(a)'s simplified pleading standard, which applies to all civil actions, the Swierkiewicz Court underscored that to satisfy Rule 8(a)(2) a complaint must include only a short and plain statement of the facts designed simply to "`give the defendant fair notice of what the plaintiff's claim is and the grounds upon which it rests."' Id. (quoting Conley v. Gibson,355 U.S. 41, 47, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957)). "This simplified notice pleading standard relies on liberal discovery rules and summary judgment motions to define disputed facts and issues and to dispose of unmeritorious claims." Id.
Insofar as the heightened pleading doctrine Bushnell relies upon is reflected in Second Circuit case law expressing a contrary rule, it predates Swierkiewicz and was subsequently overruled by the Second Circuit. See, e.g., Phelps v. Kapnolas,308 F.3d 180, 186-87 (2d Cir.2002) ("However unlikely it may appear to a court from a plaintiff's complaint that he will ultimately be able to prove an alleged fact . . . the court may not go beyond Fed.R.Civ.P. 8(a)(2) to require the plaintiff to supplement his pleadings with additional facts that support his allegation . . . either directly or by inference.").In the light of the applicable pleading standard, Streit's complaint is more than sufficient to satisfy Rule 8(a)(2). By the same token, Bushnell's motion, even putting its polemics aside, misses the mark. The factual predicate for Bushnell's legal theory based on the Statute of Frauds is that the parties' agreement as Streit describes it pertained solely to the marketing of the rights to Bushnell's book Sex and the City for adaptation to television or film, and thus constituted a contract relating to the negotiation of a business opportunity within the meaning of NYGOL § 5-701(a)(10), rather than an employment agreement for professional management services that is not subject to NYGOL § 5-701(a)(10), as Streit alleges. Bushnell's argument ignores an elementary threshold governing Rule 12(b)(6) motions to dismiss: that, regardless of the defendant's denials and contrary versions of the underlying events, it is the plaintiff's account of the facts that the Court must accept as true and from which the Court is directed to draw all reasonable inferences in plaintiff's favor.
1. Pursuant to a stipulation among the parties, Streit withdrew his fraudulent conveyance claim in response to Star's declaration, sufficiently documented, that he is a resident of California, which would have removed the Court's subject matter jurisdiction over the action under diversity of citizenship rules. 2. To cite just one example among many, in her reply papers Bushnell notes that in taking issue with Bushnell's reference to Streit's role as that of a literary agent, Streit "screams" about the alleged mischaracterization. (Def.'s Reply Mem. at 2 n. 2.) Bushnell then asserts that Streit "is completely incorrect," and denies that she ever claimed that Streit was her agent, literary or otherwise. Id. She then declares that Streit "is also incorrect" in stating that Bushnell never disputed that she paid him $10,000 as his percentage fee for placing Sex and the City with HBO. Bushnell's matter-of-fact remarks that Streit is "incorrect" in his account of the events serve only to confirm that these differences manifest quintessential disputes as to issues of material fact that the Court cannot properly adjudicate at this stage of the proceedings. 3. Attached to his response to the motion at hand, Streit includes his own affidavit clarifying or elaborating on several aspects of his pleadings as set forth in the First Amended Complaint. (See Pl.'s Mem. of Law in Opp'n to Def.'s Mot. to Dismiss, dated December 14, 2005.) A complaint cannot be modified by a party's affidavit or by papers filed in response to a dispositive motion to dismiss or for summary judgment. See Wright v. Ernst & Young LLP,152 F.3d 169, 178 (2d Cir.1998). Because Streit's Affidavit was not a document relied upon, attached to or incorporated by reference in the First Amended Complaint, the Court has given no consideration to its content. 4. Bushnell expends considerable energy analyzing differences between the Original and the First Amended Complaint. She points to a number of alleged inconsistencies between them, and urges the Court to disregard changes in factual statements Streit made in the amended pleadings in response to Bushnell's first motion to dismiss. (See Def's Mem. at 3-5 and Def.'s Reply Mem. at 3-5.) The Court declines this invitation, as it runs against the letter and spirit of the flexible pleading standards embodied in Federal Rules of Civil Procedure 8(a) and 8(e) with regard to original complaints and Rule 15 as to amended pleadings.
It is not uncommon for litigants to amend pleadings in response to deficiencies pointed out by an adversary or even by the Court, either before a dispositive motion is filed or in response to a ruling on a motion that grants leave to replead and offers specific guidance as to how any flaws in the pleadings may be cured to survive dismissal. Some such corrective amendments serve a useful purpose in avoiding unnecessary motion practice. Not surprisingly, some later pleadings made in this context necessarily may be at odds with allegations the party asserted in the original pleadings. It would be a harsh rule of law indeed if a litigant were to change a statement in an amended pleading to repair a weakness cited by an adversary or by the Court, only to have the case dismissed because the conforming change in some way may conflict with an allegation in the earlier pleadings. Contrary to such a result, Rule 8(e) explicitly permits litigants, even within the same pleadings, to "state as many separate claims or defenses as the party has regardless of consistency." Fed. R.Civ.P. 8(e) (emphasis added). And Rule 15, after authorizing amendments of pleadings as-of-right within a specified period, provides for amendments with permission of the court and instructs that "leave shall be freely given when justice so requires." Fed.R.Civ.P. 15(a). In support of her request, Bushnell cites Wallace v. New York City Dep't of Corrections, No. 95 Civ. 4404, 1996 WL 586797, at *2 (E.D.N.Y. Oct.9, 1996). There, the court noted that in an amended complaint the plaintiff had "blatantly" changed his statement of the facts in response to the defendants' motion to dismiss and "directly contradict[ed]" allegations set forth in the original complaint. Id. The court accepted the factual account in the original complaint and dismissed the action. This Court finds the circumstances of the instant case distinguishable and thus declines to follow Wallace. The factual change at issue in Wallace was "blatant" and directly contradictory of the earlier allegations because it entailed an essential element of plaintiff's cause of action without which plaintiff could not make out a prima facie case. The Court does not read the modifications of the pleadings at issue here to implicate such dispositive effect. 5. NYGOL § 5-701(a)(10) provides in pertinent part:
a. Every agreement, promise or undertaking is void, unless it or some note or memorandum thereof be in writing, and subscribed by the party to be charged therewith . . . if such agreement, promise or undertaking: . . . . 10. Is a contract to pay compensation for services rendered . . . in negotiating the purchase [or] sale . . . of a business opportunity. . . . N.Y. Gen. Oblig. Law § 5-701(a)(10) (McKinney 2006).
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