Opinion
01 Civ. 1249 (RMB).
July 12, 2006
DECISION ORDER
I. Introduction
On or about February 16, 2001, Reckson Operating Partnership, L.P. ("Reckson" or "Plaintiff") filed a complaint against New York State Urban Development Corporation d/b/a Empire State Development Corporation ("ESDC" or "Defendant") and several of its employees, seeking declaratory and injunctive relief, as well as damages in connection with Plaintiff's "April 12, 2000 bid offer to purchase certain excess state property located within the facility known as the Pilgrim Psychiatric Center ("Pilgrim State" or the "Property"), located in the Town of Islip, Suffolk County, New York." (Complaint, dated February 16, 2001, ¶ 1.) Plaintiff alleges that Defendant refused to accept its bid for the Property in retaliation for a state court lawsuit filed by Plaintiff against Defendant on March 17, 2000, and that Defendant (1) "acting under color of state law . . . violated plaintiff's right of access to the courts, as protected by the First Amendment right to petition for redress and the Due Process Clauses of the Fifth and Fourteenth Amendments to the United States Constitution;" (2) "treated plaintiff differently than other preferred bidders based exclusively upon plaintiff's exercise of its constitutional right to petition the government for the redress of grievances" and "acting under color of state law . . . violated the rights of plaintiff under the Equal Protection Clause of the Fifth and Fourteenth Amendments to the United States Constitution;" and (3) unlawfully withheld a "$2.5 million deposit that [Plaintiff] delivered to ESDC on or about April 5, 2000." (Complaint, ¶¶ 1, 95, 105-106, 112.)
On March 3, 2003, Judge Kimba M. Wood, to whom this case was originally assigned, granted in part Plaintiff's motion for summary judgment and ordered Defendant "to return plaintiff's $2.5 million deposit with interest." (Order, dated March 3, 2003, at 2.) Also on March 3, 2003, Judge Wood dismissed Plaintiff's claims for damages against the individual Defendants because "the individual defendants are entitled to qualified immunity." (Order, dated March 3, 2003, at 1.)
The case was assigned to this Court on or about September 27, 2005.
On or about November 15, 2005, Defendant moved for summary judgment on Plaintiff's remaining claims (Notice of Motion by Defendant for Summary Judgment, dated November 15, 2005 ("Def. Mot."); Memorandum of Law of Defendant Empire State Development Corporation in Support of Motion for Summary Judgment, dated November 15, 2005 ("Def. Mem."); Rule 56.1 Statement of Defendant, dated November 15, 2005 ("Def. 56.1")), arguing that: (1) Plaintiff's First Amendment claim fails because, inter alia, Plaintiff "lacked any prior contractual relationship" with Defendant and because Plaintiff's speech "concerns a commercial transaction" and does not fulfill a "public concern requirement;" and (2) Plaintiff "has not asserted an Equal Protection claim that is independent from its First Amendment claim." (Def. Mem. at 10, 12, 13, 17-19, 22, 24.)
On or about January 13, 2006, Plaintiff filed an opposition (Plaintiff's Memorandum of Law in Opposition to Defendants' Motion for Summary Judgment and in Support of Plaintiff's Motion for Summary Judgment Pursuant to Fed. Rules Civ. Proc. Rule 56, dated January 13, 2006 ("Pl. Mem."); Plaintiff's Local Rule 56.1 Statement in Response to Defendants' Rule 56.1 Statement and in Support of Plaintiff's Motion for Summary Judgment, dated January 13, 2006 ("Pl. 56.1")), arguing, inter alia, that: (1) "a prior governmental contractual relationship is not a prerequisite for [Plaintiff's] First Amendment retaliation claim" and "the `public concern' doctrine does not apply to [Plaintiff's] right of petition claim;" and (2) Plaintiff's Equal Protection claim "does not coalesce with its First Amendment retaliation claim." (Pl. Mem. at 2, 3, 8, 12-13, 15.) Plaintiff also (cross) moves for summary judgment, arguing that (1) Defendant's "refusal to countersign let alone close, and . . . to return [Plaintiff's] $3.2 million deposit, was taken in response to [Plaintiff's] protected activity" and Defendant cannot prove "that it had a legitimate non-retaliatory reason for refusing to accept [Plaintiff's] offer and for refusing to return [Plaintiff's] deposit;" and (2) Plaintiff's Equal Protection rights were violated because "similarly situated people . . . were treated differently" and Defendant "has asserted no compelling state interest supporting its refusal to execute [a] Purchase and Sale Agreement with [Plaintiff]." (Pl. Mem. at 18-19, 23-24.)
On or about February 14, 2006, Defendants filed a reply, arguing that (1) Plaintiff has "no . . . evidence of retaliatory intent by ESDC's Board;" and (2) "[r]ights secured by the Equal Protection Clause vest in individuals, not in business activities." (Reply Memorandum of Law of Defendant Empire State Development Corporation in Support of Motion for Summary Judgment and in Opposition to the Cross-Motion by Plaintiff for Summary Judgment, dated February 14, 2006 ("Def. Reply"), at 8-9.)
For the reasons set forth below, Defendants' motion for summary judgment is granted, and Plaintiff's motion for summary judgment is denied.
II. Background
"Plaintiff first tried to buy Pilgrim State in response to an Invitation to Bid dated November 16, 1998. In November 1999, [Defendant] withdrew plaintiff's bid [as non-conforming]." (Declaration [of Bruce K. Leber] in Support of Motion by Defendant for Summary Judgment, dated May 14, 2004 ("Leber Decl."), ¶ 6.) In January 2000, Defendant issued a second invitation to bid on the Pilgrim State property. (Pl. 56.1 ¶ 78.)
On March 17, 2000, Plaintiff commenced an action ("State Court Complaint") against Defendant and the New York State Dormitory Authority in the New York State Supreme Court, Suffolk County seeking "the return of [Plaintiff's] $3.2 million deposit [paid by Plaintiff on December 3, 1998] . . . and damages in the amount of $25 million," in connection with the first invitation to bid. (Pl. 56.1 ¶¶ 76-77; Verified Complaint, dated March 17, 2000, ¶¶ 1 ("This action seeks damages . . . in connection with the aborted sale to Reckson of four parcels of excess land . . ."), 38; Def. 56.1 ¶ 4, 23.)
On April 5, 2000, Plaintiff submitted "a certified deposit check in the amount of . . . $2.5 million" in response to the second invitation to bid. (Pl. 56.1 ¶ 79-80; Def. 56.1 ¶ 24.) "On or about April 14, 2000, [Defendant] issued . . . a press release announcing that [Plaintiff] submitted the winning . . . bid." (Pl. 56.1 ¶ 81; Def. 56.1 ¶ 24.)
On September 18, 2001, the New York State Supreme Court, Suffolk County ruled that "plaintiff is entitled to a refund of its $3.2 million deposit with accrued interest." Reckson Operating P'ship, L.P. v. New York State Urban Dev. Corp., No. 00 Civ. 6126, 2001 WL 1649258 (N.Y.Sup.Ct. Sept. 18, 2001),aff'd, 751 N.Y.S.2d 279 (N.Y.App.Div. 2002).
On June 15 and August 17, 2000, meetings were held between representatives of Plaintiff and Defendant to negotiate terms of the sale of the Property, including the State Court Complaint. (Pl. 56.1 ¶¶ 83-91, Def. 56.1 ¶ 29.) According to Plaintiff, Defendant's employees refused to finalize the sale of the Property "with litigation outstanding." (Pl. 56.1 ¶ 85.) The parties were unable to come to terms, and Defendant "never countersigned and delivered to [Plaintiff] the Purchase and Sale Agreement." (Pl. 56.1 ¶ 95.) "By letter . . . dated December 1, 2000, [Plaintiff] withdrew its offer to purchase the surplus state land and requested the return of its signed Purchase and Sale Agreements, as amended, and the return of its deposit with interest." (Pl. 56.1 ¶ 102.) "By letter dated January 11, 2001, [Defendant] . . . `accept[ed] the withdrawal of the offer to purchase the land,'" but did not at the time return Plaintiff's $2.5 million deposit. (Pl. 56.1 ¶ 103.)
III. Legal Standard
"[S]ummary judgment is appropriate where there exists no genuine issue of material fact and, based on the undisputed facts, the moving party is entitled to judgment as a matter of law. A material fact is one that would affect the outcome of the suit under the governing law, and a dispute about a genuine issue of material fact occurs if the evidence is such that a reasonable [factfinder] could return a verdict for the nonmoving party. In determining whether there is a genuine issue of material fact, the court must resolve all ambiguities, and draw all inferences, against the moving party." GlobalNet Financial.Com, Inc. v. Frank Crystal Co., Inc., 449 F.3d 377, 381-82 (2d Cir. 2006) (internal citations omitted).
IV. Analysis
First Amendment Claim
Defendant argues that "[a]s a bidder with no prior contractual relationship with ESDC, [Plaintiff] lacks the requisite status to mount a First Amendment claim" under Bd. of County Comm'rs v. Umbehr, 518 U.S. 668, 685 (1986) and African Trade Info. Ctr., Inc. v. Abromaitis, 294 F.3d 355, 360-62 (2d Cir. 2002), which "declined to recognize the standing of a bidder with no prior contractual relationship to bring a First Amendment claim against a governmental entity." (Def. Mem. at 9-10.) Defendant also argues that Plaintiff's speech "does not constitute protected activity" because "the public concern requirement applies to all bidders," and Plaintiff's speech involved only a "private commercial dispute." (Def. Mem. at 11, 13.) Plaintiff counters that "a prior governmental contractual relationship is not a prerequisite for [Plaintiff's] First Amendment retaliation claim," and that Defendant's argument "is premised upon an erroneous analysis" of Supreme Court and Second Circuit caselaw. (Pl. Mem. at 3.) Plaintiff also argues that "the `public concern' doctrine does not apply to [Plaintiff's] right of petition claim," and that, even if it did, "[Plaintiff's] State Court complaint did raise issues of `public concern,' as it is replete with allegations of [Defendant's] incompetence, errors and mismanagement." (Pl. Mem. at 2-3.)
Both the United States Supreme Court and the United States Court of Appeals for the Second Circuit have declined to determine whether bidders or applicants for government contracts without "a pre-existing commercial relationship with the government" have standing to bring a First Amendment retaliation claim. See Umbehr, 518 U.S. at 685 ("[W]e emphasize the limited nature of our decision today. Because Umbehr's suit concerns the termination of a pre-existing commercial relationship with the government, we need not address the possibility of suits by bidders or applicants for new government contracts who cannot rely on such a relationship."); African Trade, 294 F.3d at 359-60 ("[W]e think the . . . prudent approach in the circumstances of this case is to refrain from deciding whether the asserted right exists."). In any event, the Court need not reach that issue here, because Plaintiff does not otherwise satisfy the requirements of a First Amendment retaliation claim.
A plaintiff claiming First Amendment retaliation must demonstrate that: "(1) his speech addressed a matter of public concern, (2) he suffered an adverse employment action, and (3) a causal connection existed between the speech and the adverse employment action, `so that it can be said that his speech was a motivating factor in the determination.'" See Mandell v. County of Suffolk, 316 F.3d 368, 382 (2d Cir. 2003). Whether " First Amendment activity relates to a matter of public concern `is ordinarily a question of law decided on the whole record by taking into account the content, form, and context of a given statement.'" Locurto v. Giuliani, 447 F.3d 159, 173 (2d Cir. 2006) (quoting Melzer v. Bd. of Educ. of the City Sch. Dist. of the City of N.Y., 336 F.3d 185, 196 (2d Cir. 2003)). In making such a determination, the Court evaluates "whether the speech relates to `any matter of political, social, or other concern to the community,' . . . and whether the speech `was calculated to redress personal grievances or whether it had a broader public purpose.'" Hoyt v. Andreucci, 433 F.3d 320, 330 (2d Cir. 2006) (internal citations omitted).
Plaintiff's "speech" as reflected in the State Court Complaint, dated March 17, 2000, concerns a purely commercial matter and has "little or no relevance to matters of public concern." See White Plains Towing Corp. v. Patterson, 991 F.2d 1049, 1058 (2d Cir. 1993) (quoting Connick v. Myers, 461 U.S. 138, 147 (1983) for the proposition that "[W]hen a public employee speaks not as a citizen upon matters of public concern, but instead as an employee upon matters only of personal interest, absent the most unusual circumstances, a federal court is not the appropriate forum in which to review the wisdom of a personnel decision taken by a public agency allegedly in reaction to the employee's behavior."). The State Court Complaint alleges private commercial grievance, i.e., that Plaintiff, "in reliance upon the express representations of ESDC . . . expended millions of dollars and committed its planning and development resources and expertise to assisting and resolving for defendants the numerous errors which prevented them from selling this otherwise valuable property to [Plaintiff] or any other entity." (State Court Complaint, ¶¶ 2, 16-18 ("[D]efendants have . . . appropriated [Plaintiff's] good faith diligent efforts and expertise over the course of a long year of intense planning and development, causing substantial injury to [Plaintiff] and creating enormous value for themselves."), 138-39 ("[U]pon its selection as the preferred bidder for the excess lands . . . [Plaintiff] used its own planning and development staff to resolve . . . various issues . . . at significant expense, incurring substantial labor costs, administrative and engineering overhead, and ultimately shut down costs for which it is entitled to reimbursement."), 141 ("[I]n connection with this transaction . . . [Plaintiff] incurred substantial out-of-pocket costs, measured in the millions of dollars, as described herein, and in labor costs, administrative and engineering and overhead costs, and shut-down costs."), 142-43, 147-49, 172 ("The appropriation and incorporation of . . . new items into the new Invitation to Bid has not only deprived [Plaintiff] of its work product for no compensation, but has added significant value to the excess lands now being offered for sale and to the lands being retained by defendants.")); see White Plains Towing, 991 F.2d at 1060 ("These communications stated private commercial grievances that do not appear to relate to any matter of political, social, or other concern to the community and hence could not provide a basis for recovery.").
Notwithstanding Plaintiff's argument to the contrary, the Court of Appeals for the Second Circuit has declined to "limit the public concern requirement to First Amendment claims based on free speech, as opposed to claims premised on other forms of First Amendment expression" and has ruled "that retaliation claims premised on the First Amendment right to petition are subject to [the] public concern requirement." See Cobb v. Pozzi, 363 F.3d 89, 104-105 (2d Cir. 2004) (applying "the Supreme Court's teaching that there should exist no hierarchy among First Amendment rights" and citing White Plains Towing, 991 F.2d at 1059); (see also Order, dated March 3, 2002, at 7 n. 4).
Plaintiff also cites Second Circuit caselaw presumably holding that the public concern doctrine is reserved for situations where the government is acting as an employer, see Garcia v. S.U.N.Y. Health Scis. Ctr. of Brooklyn, 280 F.3d 98, 106 (2d Cir. 2001), but the Supreme Court has held that in the First Amendment context there is no difference "of constitutional magnitude . . . between independent contractors and employees."See Umbehr, 518 U.S. at 684 (internal citation and quotation marks omitted); see also African Trade, 294 F.3d at 364 n. 1 (Katzmann, J., concurring) (citing Umbehr, 518 U.S. at 674); (Order, dated March 3, 2002, at 14-16). Circuit Judge Robert A. Katzmann, concurring in African Trade, commented upon the application of the public concern requirement to contractors bidding for a state contract. See African Trade, 294 F.3d at 364 ("While this Circuit has not explicitly extended First Amendment protection to contractors who are bidding for a contract, logic and Supreme Court precedent strongly suggest that the state may not retaliate against such contractors for speaking out on issues of public concern. ") (Katzmann, J., concurring) (emphasis added).
And, Plaintiff unpersuasively argues that "[t]his Court has twice held that the `public concern' doctrine does not apply to [Plaintiff's] right of petition claim, and therefore [Defendant's] attempt to relitigate this issue must be rejected." (Pl. Mem. at 2-3). In an Order dated March 3, 2002, Judge Kimba M. Wood "sua sponte . . . reconsidered [her] March 25, 2002 Order" and ruled that "[s]ince White Plains Towing, courts in this Circuit have applied the `public concern' requirement to public employee right to petition cases." (Order, dated March 3, 2003, at 12.) Because Plaintiff's speech "was calculated to redress personal grievances" and did not have "a broader public purpose," Plaintiff's First Amendment claim fails. See Hoyt, 433 F.3d at 330.
In an Order dated March 25, 2002, Judge Wood observed that "the public concern requirement . . . does not apply to this action." (Order, dated March 25, 2002, at 7 n. 6.)
Equal Protection Claim
Defendant argues that because Plaintiff's Equal Protection claim is premised upon its First Amendment claim, Plaintiff "fails to state an Equal Protection claim once the court finds in favor of [Defendant] on the First Amendment claim." (Pl. Mem. at 24.) Plaintiff argues that its "Equal Protection claim alleging that [Defendant] irrationally treated it differently from other bidders does not coalesce with its First Amendment retaliation claim." (Def. Mem. at 14.)
Where, as here, a plaintiff's "equal protection claim depends entirely on their contention that [Defendant's] action were impermissible [under the First Amendment]," the claims "coalesce." See African Trade, 294 F. 3d at 363-64. And, where a plaintiff's "equal protection claim and . . . First Amendment claim coalesce," the Court's grant of summary judgment "on the latter entitles [a defendant to summary judgment] on the equal protection claim as well." See id.
Judge Wood has earlier held that "Plaintiff's equal protection claim `ultimately depends on the existence of the First Amendment' right of access to the courts." (Order, dated March 3, 2003, at 19-20) (quoting African Trade, 294 F.3d at 362). Plaintiff "specifically alleges that `defendants have treated plaintiff differently than other preferred bidders based exclusively upon plaintiff's exercise of its constitutional right to petition the government for the redress of grievances." (Order, dated March 3, 2003, at 20) (quoting Complaint ¶ 105) (emphasis added). Because the Court finds that Defendant is entitled to summary judgment on the First Amendment claim, Defendant is "entitled to [summary judgment] on the equal protection claim as well." (See Order, dated March 3, 2003, at 20) (citing African Trade, 294 F.3d at 363).
And, because the Court grants Defendant's motion for summary judgment, the Court does not separately address Plaintiff's cross-motion for summary judgment, although the arguments raised therein have been considered and rejected. See Hwang v. Dunkin' Donuts, Inc., 840 F. Supp. 193, 198 (N.D.N.Y. 1994).
IV. Conclusion
For the reasons set forth above, Defendant's motion for summary judgment [# 128] is granted, and Plaintiff's cross-motion for summary judgment [# 139] is denied.
The Clerk of the Court is respectfully requested to close this case.