MADELINE COX ARLEO, District Judge.
This matter comes before the Court by way of Defendants National Collegiate Athletics Association ("NCAA") and Ameen Najjar's (collectively, "Defendants") motion to dismiss Plaintiffs Shannon Pedersen, Jaclyn Janicky, and Emily Cristaldi's (collectively, "Plaintiffs") Second Amended Complaint ("SAC"). Dkt. No. 45.
This action asserts claims for gender discrimination arising out of penalties imposed on several female NCAA athletes at Kean University. For the purposes of this motion, the following facts are taken as true.
The NCAA is an unincorporated association that acts as the governing body of many college level athletic programs. SAC at 4 ¶ 15, Dkt. No. 42.
Plaintiffs are current and former Kean University female athletes.
In 2011, Michele Sharp—the University's women's basketball coach, assistant athletic director, and Senior Women's Administrator—was charged with committing certain NCAA violations that impacted Plaintiffs' scholarship status.
An expedited trial commenced to review Ms. Sharpe's conduct and the players' participation in that game.
Plaintiffs allege that the penalty was instituted even though other less severe alternatives existed.
In August 2014, the University again denied Plaintiffs payment of funds due to their continued participation in athletics.
Plaintiffs filed the initial Complaint on behalf of themselves and other similarly situated in April 2014. Dkt. No. 1. Following several amendments, Plaintiffs filed the instant SAC in March 2015. Dkt. No. 42. The SAC asserts eleven causes of action: (1) Title IX violations; (2) federal Racketeer Influenced and Corrupt Organization Act ("RICO") violations; (3) New Jersey RICO violations; (4) equal protection violations under 42 U.S.C. § 1983; (5) conspiracy under 42 U.S.C. § 1985; (6) New Jersey Law Against Discrimination ("NJ LAD") violations; (7) interference with prospective contract advantage; (8) negligence; (9) breach of contract; (10) breach of the implied covenant of good faith and fair dealing; and (11) promissory estoppel. Defendants NCAA and Mr. Najjar filed their motion to dismiss in April 2015.
II. STANDARD OF REVIEW
When considering a Rule 12(b)(6) motion to dismiss, the court accepts as true all of the facts in the complaint and draws all reasonable inferences in favor of the plaintiff.
Defendants move to dismiss the SAC on statute of limitations grounds and as inadequately pled. The Court will address each in turn.
A. Dismissal on Statute of Limitations Grounds (Counts 1, 4, 5, 6, 8)
Defendants first move to dismiss several of Plaintiffs' claims as barred by the statute of limitations. Specifically, they argue that the two-year statute of limitations bars Plaintiffs' claims under Title IX (Count 1), §§ 1983 and 1985 (Counts 4 and 5), NJ LAD (Count 6), and negligence (Count 8). The Court agrees.
These claims are all subject to a two-year statute of limitations. Because Title IX, § 1983, § 1985, and NJ LAD have no statute of limitations, the claims must be brought pursuant to New Jersey's two-year statute of limitations for personal injury torts.
With the exception of NJ LAD, the limitations period for these claims "begins to run when plaintiff knew or should have known of the injury upon which its action is based."
Here, all five claims revolve around Defendants' revocation of Plaintiffs' scholarships in September 2011. Plaintiffs knew about the decision because they were asked that same month to decide whether to play or keep their scholarship. As alleged in paragraph 28 of the SAC, "[o]n or around September 30, 2011, shortly after Kean University was put on notice for a violation dealing with off-season activities in Europe, plaintiffs were removed from their respective sports team or forced to forfeit their scholarship money with no hearing or considering any other less severe alternative besides removal from the team or revoking of their scholarship." SAC 28 ¶ 28. These claims therefore accrued on or around September 30, 2011.
Plaintiffs argue first that the "complaint was filed within two years of the NCAA's April 19, 2014 letter with sanctions." Opp'n Br. at 26. But the SAC makes no mention of any such letter or sanctions. It appears that Plaintiff is attempting to inserts facts into the brief that are not averred in the SAC. The Court will not consider allegations not stated in the SAC. Plaintiffs may not "amend" a complaint through statements made in an opposition brief.
Alternatively, Plaintiffs argue that the continuing violations doctrine should apply to Defendants' continued refusal to grant Plaintiffs their scholarships until as recently as January 2014. The Court disagrees.
The continuing violations doctrine "allow[s] for the aggregation of acts, each of which, in itself, might not have alerted the [plaintiff] of the existence of a claim, but which together show a pattern of discrimination."
Here, Defendants' continued refusal to deny Plaintiffs a scholarship is simply a residual effect of the original scholarship revocation. Plaintiffs, moreover, were alerted about the existence of the claim when the denial occurred in September 2011, and no pattern of discrimination was necessary to shed light on Defendants' allegedly discriminatory conduct. The continuing violations doctrine therefore has no application in this case.
Accordingly, Counts 1, 4, 5, 6, and 8 are dismissed as time-barred and dismissed with prejudice.
B. Dismissal for failure to state a prima facie claim (Counts 2 and 3)
Plaintiffs assert violations under both federal and New Jersey RICO statutes. 18 U.S.C. § 1962(c); N.J. Stat. Ann. § 2C:41-1.2. Essentially, they offer three theories. First, Mr. Hedden conspired with a group of subordinates, the NCAA, and Mr. Najjar to ensure that Plaintiffs suffered a maximum penalty.
Because Plaintiffs' federal and New Jersey RICO claims parallel each other, and because the two RICO statutes are intended to be coextensive, the Court will analyze the claims concurrently.
Defendants argue that Plaintiffs fail to meet several elements of both RICO statutes. The Court agrees. As explained below, each of Plaintiffs' three theories fail to meet several elements.
"Establishing liability under § 1962(c) of the RICO statute requires (1) conduct (2) of an enterprise (3) through a pattern (4) of racketeering activity, plus an injury to business or property."
"The [federal] RICO statute does not specifically define the outer boundaries of the `enterprise' concept but states that the term `includes any individual, partnership, corporation, association, or other legal entity, and any union or group of individuals associated in fact although not a legal entity."
Plaintiffs' second and third theories plainly do not allege an enterprise. The second theory merely alleges that the University "and its actors" made certain statements. Under the federal statute, this does not reference two distinct parties. Under the state statute, the threadbare allegation that "actors" were involved is not a plausible allegation of an enterprise. The third theory, which points to the NCAA's marketing material, suffers from the same flaws.
Second, under all three theories, Plaintiffs do not allege a pattern of racketeering activity. Under the federal statute, "[r]acketeering activity" is defined to include a list of state and federal offenses, 18 U.S.C. § 1961(1), one of which is the federal mail fraud statute, 18 U.S.C. § 1341.
Here, Plaintiffs allege that Defendants' conduct "constitute[s] mail fraud in violation of § 1341, and as such constitutes a pattern of racketeering activity." SAC 19 ¶ 60, 22 ¶ 79. Where, as here, the plaintiff asserts fraud-related predicate acts, the pleading must meet the standard of particularity set forth under Rule 9(b).
Third, under all three theories, Plaintiffs have not pled that the conduct "affected trade or commerce." Under the New Jersey statute, a plaintiff must allege that the "defendant was employed by or associated with a racketeering enterprise which engaged in trade or commerce in New Jersey or affected trade or commerce in New Jersey."
Finally, under all three theories, Plaintiffs did not allege an injury to business or property proximately caused by Defendants' conduct. "A civil RICO plaintiff is also required to plead causation. `[T]o state a claim under civil RICO, the plaintiff is required to show that a RICO predicate offense not only was a but for' cause of his injury, but was the proximate cause as well.'"
Accordingly, Counts 2 and 3 are dismissed. Dismissal of these claims will be with prejudice because further amendment would be futile.
C. Remaining State Law Claims (Counts 7, 9, 10, 11)
Because all of Plaintiffs' federal claims have been dismissed, Plaintiffs' remaining four claims—interference with contractual advantage, breach of contract, breach of the covenant of good faith and fair dealing, and promissory estoppel—all sound in state law. Plaintiffs assert that the Court has supplemental jurisdiction over the state law claims pursuant to 28 U.S.C. § 1367. SAC ¶ 10. While Defendants argue for dismissal of these claims on the merits, the Court will instead dismiss them on jurisdictional grounds.
"The district courts may decline to exercise supplemental jurisdiction . . . if . . . the district court has dismissed all claims over which it has original jurisdiction. . . ." 28 U.S.C. § 1367(c)(3). "The decision to retain or decline jurisdiction over state-law claims is discretionary" and "should be based on considerations of judicial economy, convenience and fairness to the litigants."
The Court finds it appropriate to decline jurisdiction over Plaintiff's remaining state law claims. The remaining claims involve interpretation of wholly state-based claims sounding in tort and contract. Additionally, as this case is still at an early stage in the litigation, "dismissal of the pendent state claims in a federal forum will result in neither a waste of judicial resources nor prejudice to the parties."
Accordingly, the Court will dismiss Plaintiff's state law claims in accordance with 28 U.S.C. § 1367(c)(1). These counts are dismissed without prejudice.
For the reasons set forth herein, Defendants' motion to dismiss, Dkt. No. 45, is