Harbor Distributing Corp. v. GTE Operations Support Inc.

176 F. Supp. 3d 204, 2016 WL 1228615, 2016 U.S. Dist. LEXIS 40783
District Court, E.D. New York·Decided March 28, 2016·No. No. 15-CV-4123 (JFB)(AYS)·Published·Cited by 9 cases

Opinion

MEMORANDUM AND ORDER

Joseph F. Bianco, District Judge:

Plaintiff, Harbor Distributing Corp. (hereinafter, “plaintiff’), brings this suit against defendants, GTE Operations Support, Inc. (hereinafter, “GTEOSI”) and Verizon New York Inc. (hereinafter, “Verizon”) (collectively, “defendants”). Plaintiff (1) seeks a declaratory judgment that GTEOSI cannot terminate its lease agreement with plaintiff and that the obligations in the parties’ lease remain in full force and effect, (2) requests a preliminary and permanent injunction barring GTEOSI from unilaterally terminating the parties’ lease, and (3) asserts that defendants have breached the lease. Defendants now move to dismiss plaintiffs complaint pursuant to Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure, asserting that (1) this Court lacks subject matter jurisdiction to hear plaintiffs declaratory judgment claim, (2) plaintiff cannot maintain a claim for preliminary or permanent injunction because an injunction is a type of remedy, not a cause of action, and (3) plaintiff has failed to sufficiently, allege a claim for breach of the lease.

For the reasons set forth herein, the Court grants defendants’ motion to dismiss in its entirety. First,, with respect to plaintiffs declaratory judgment claim, there is no case or controversy for the Court to decide, as defendants agree that they cannot terminate the lease at this time. Second, plaintiffs .breach of lease claim fails because plaintiff has made only a concluso-ry allegation of breach, and has failed to provide notice to defendants as to the nature of the alleged breach. Given the vagueness of the claim, the Court also cannot decide whether a plausible claim exists. Finally, because the two substantive claims are dismissed, plaintiffs claim for injunctive relief must be denied as well. However, plaintiff will be permitted to re-plead its beach of lease claim. Moreover, the dismissal of the declaratory judgment claim is without prejudice to re-asserting it once defendants provide a notice of termination (or otherwise indicate they believe the conditions to terminate have been satisfied).

I. BACKGROUND

A. Factual Background

Unless otherwise noted, the following facts are taken from the complaint (“Compl.”) filed in this Court on July 14, 2015 and are not findings of fact by the Court.

This • dispute involves a piece of real property (hereinafter, the “property”) .in Hicksville, New York. (Compl. ¶ 1.) A predecessor of GTEOSI,1 manufactured nucle[208] ar fuel elements on the property from 1952 to 1967, which contaminated the property with uranium, thorium, and tetrachloroe-thylene. (Id. ¶¶ 6-7.) Plaintiff is the current owner of the property. (Id. ¶ 13.) From 1992 to 2002, plaintiff leased the property, which includes an industrial building with office space, to a non-party tenant. (See id. ¶¶ 6, 8,14.)

When the historic contamination of the property was discovered, GTEOSI agreed to undertake certain remedial efforts to restore the property. (See id. ¶¶ 8, 18, 20.) In connection with this undertaking, in April 2002, GTEOSI entered into an agreement (hereinafter, the “agreement” or the “lease”) with plaintiff, whereby it agreed to assume the non-party’s commercial lease and pay rent to plaintiff. (See id. ¶¶ 8, 14-15.) The agreement between GTEOSI and plaintiff provided that GTEOSI would perform certain remedial work at the property and that the lease would extend until this work was complete. (See id. ¶¶ 8,19.) The lease further provided that the remediation work would be deemed complete upon the satisfaction of three conditions: (i) the restoration of the property to the condition in which it existed at the commencement of the lease, (ii) the absence of any leasing restrictions imposed by any State governmental authority, and (iii) GTEOSI’s vacation of the premises. (Id. ¶ 21.) Pursuant to the agreement, the lease would terminate six months after defendants completed the remedial work. (See Pl.’s Opp’n, Ex. 1 § 3.1.3(b).)

In 2009, the United States Army Corps of Engineers accepted oversight of the remediation of the property. (Compl. ¶¶ 42-43.) Several years later, in August 2014, GTEOSI wrote plaintiff explaining that:

[S]ome years ago the United States Army Corps of Engineers (USACE) accepted oversight of the responsibility for investigating and remediating the contamination that was being addressed by GTEOSI .... Rather than simply walk away from the site[,] GTEOSI has remained at the property to help facilitate the USACE effort. ... GTEOSI has recently decided that it is no longer appropriate for it to remain in this position. GTEOSI approached [you] to help assure a smooth transition to the government. ... GTEOSI will not terminate the lease at this time to better enable [you] to successfully work things out with the Federal Government. While I do not know how long GTEOSI will agree to refrain from providing notice of termination, I am hopeful that it will not have to do so before [you] are able to come to terms with the USACE.

(Id. ¶ 27; Pl.’s Opp’n, Ex. 3 at 1-2.)

According to plaintiff, at a meeting in January 2015, counsel for Verizon informed plaintiff that Verizon intended to terminate the agreement.2 (Compl. ¶ 28.) However, in a subsequent communication regarding this meeting, plaintiff clarified that: “[a]t our meeting, you expressed the opinion that your company had completed the first phase of remediation, and was permitted to terminate the lease. You indicated that it was the intention of GTEOSI to terminate, but that it was not something that would occur in the immediate future, and that you would provide us several months’ advance warning of this.” (See Pl.’s Opp’n, Ex. 8 at 1.) Nevertheless, concerned that defendants intended to prema[209] turely end the parties’ agreement, plaintiff filed this suit, seeking a declaration that “pursuant to the terms of the [lease] ... [GTEOSI] has no right to terminate the lease between it and [plaintiff].” (Compl. at Prayer for Relief (i).)

In their opposition and at oral argument, defendants represented that they are not seeking to terminate the lease at this time and that they do not believe that they have satisfied the contractual prerequisites for termination. (See, e.g,, Defs.’ Reply Mot. at 3 (“GTEOSI has not declared the [l]ease terminated and acknowledges that the condition precedent to termination has not been satisfied.”); Defs.’ Mot. at 9 (same).)

B. Procedural History

Free access — add to your briefcase to read the full text and ask questions with AI

Harbor Distributing Corp. v. GTE Operations Support Inc., 176 F. Supp. 3d 204, 2016 WL 1228615, 2016 U.S. Dist. LEXIS 40783 (E.D.N.Y. 2016).

176 F. Supp. 3d 204 (Harbor Distributing Corp. v. GTE Operations Support Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related