United States District Court,

S.D. New York.

Susan and Larry BRODY, Plaintiffs,

v.

LIFFEY VAN LINES, INC., Allied Van Lines, Inc., Sirva, Inc., and New York Self Storage Inc., Defendants.

 

No. 13 Civ. 5719(CM).

Signed May 29, 2014.

 

AMENDED DECISION AND ORDER

McMAHON, District Judge.

*1 The following allegations, taken from the complaint, are deemed true on this motion for judgment on the pleadings pursuant to Fed.R.Civ.P. 12(c):

 

Susan and Larry Brody moved their household goods from New York City to a new home in Palm Beach Gardens, Florida. They engaged Liffey Van Lines FN1 to pack, store, ship and deliver their household goods from 15 West 63 rd Street in Manhattan. The complaint alleges that some of the household goods were to be delivered to an address in Palm Beach Gardens and some to “a second home in New York City.” (Cplt.¶ 8).

 

FN1. In a previous version of this opinion, I erroneously stated (based on the Brodys’ complaint) that Liffey was “a subsidiary of Allied Van Lines (which is itself a subsidiary of SIRVA. Inc.).” Counsel for Allied Van Lines and SIRVA wrote to the Court to inform me that although SIRVA is the parent company of Allied Van Lines, the two corporations have no relationship with Liffey Van Lines.

 

Liffey packed and stored the furniture and other household goods in its warehouse for some months; plaintiffs paid the monthly storage fees via checks made payable to New York Self Storage, Inc. (Cplt.¶ 11). When plaintiffs contacted Liffey about moving “some” of their goods to Florida, they signed a second contract with Liffey’s parent corporation, Allied Van Lines, which transported the goods to Florida. Plaintiffs allege that they were “forced” to sign this contract, because their possessions were “held hostage” by Liffey. (Cplt.¶¶ 12–15)

 

When the goods arrived in Florida, they were damaged. (Cplt.¶ 17).

 

The Brodys decided that they no longer had faith in Liffey and sought to pick up their possessions from Liffey’s warehouse on West 121 st Street in Manhattan. Liffey refused to release Plaintiffs’ possessions until they signed a “Release Statement,” no copy of which has been provided to the court. (Cplt.¶ ¶ 20–21)

 

When plaintiffs took control of the goods that had never left New York City, they found that these items, too, were damaged. (Cplt.¶ 22)

 

The total amount of damages to plaintiffs’ goods was $273,362 for a total of 22 items. $42,500 of that amount was attributable to the damage to the goods that never left New York City. (Cplt ¶¶ 22, 25)

 

At every step along the way, the Brodys had indicated that they wanted extra care taken with their goods. They obtained extra insurance coverage for up to $400,000 in connection with their original contract with Liffey, and selected and prepaid for the “Extra Care Protection Plan” in connection with their contract with Allied. (Cplt.¶¶ 14, 10)

 

Allied, after investigating the damage claims, cut plaintiffs a check for $13,118.38, which it claimed to be the limit of its liability for the goods it had transported. (Cplt.¶ 26) Plaintiffs have refused to accept or deposit this check.

 

The Brodys brought this action in the New York State Supreme Court on July 17, 2013. They asserted twelve claims, all under state law, including claims for breach of contract, something called “Recovery Upon Liability” (which seems to have to do with the fact that defendants induced plaintiffs to purchase additional insurance-I cannot tell from the complaint whether claims have been made to the relevant insurers), damage to property, “personal injury” (the emotional distress that plaintiffs have suffered as a result of this ordeal), negligence, and fraud (which appears to be barred by their claims for breach of contract as a matter of state law). Three of plaintiffs’ claims are asserted twice-once in relation to the property that was delivered to Florida, and separately in relation to the property that remained in the warehouse in New York City.

 

*2 Allied Van Lines and SIRVA immediately removed the action to this court, asserting that all the claims against them were barred by the Carmack Amendment-a federal law that limits the liability of interstate carriers for shipments in interstate commerce. This position was ultimately adopted by Liffey as well.

 

Defendant New York Self Storage, Inc., has been served through the Secretary of State but has never appeared in this action. As the Carmack Amendment does not apply to storage companies—only to the interstate transportation of goods by motor carriers—any claims against NYSS necessarily arise under state law. Those claims are, however, cognizable in this court under principles of supplemental jurisdiction. See 28 U.S.C. § 1367(a). There is no indication that NYSS consented to removal, but the removal statute, 28 U.S.C. 1441(c), does not require that a defendant against which only state law claims lie consent to removal.FN2 Liffey and SIRVA, the two defendants aside from Allied that might be impacted by the Carmack Amendment, did consent to removal. (Notice of Removal, Docket # 1, at ¶ 6)

 

FN2. The statute is oddly drafted. It permits the removal of an action in which there is a claim that “arises under” federal law, even if joined with a claim over which the court could assert neither original nor supplemental jurisdiction, but requires any such claim to be severed and remanded to the state court. It then goes on to say that only defendants against whom a federal “arising under” claim are alleged need to consent to removal—in this case, Liffey and SIRVA (which is probably not a viable defendant in any case, since I imagine it will be hard to pierce any corporate veil between it and Allied). This means that New York Self Storage-against which only state law claims are asserted, but which is plainly subject to supplemental jurisdiction-can be forced to litigate in a federal court without its consent, which has not been obtained and which apparently does not need to be obtained. In any event, New York Self Storage, which has been served with process, is in default.

 

Allied, SIRVA and Liffey have now moved for judgment on the pleadings. SIRVA’s and Allied’s motions are granted, albeit for different reasons; Liffey’s motion is granted in part and denied in part.

 

Judgment on the Pleadings

A motion for judgment on the pleadings pursuant to Fed.R.Civ.P. 12(c) is governed by the same standards as a motion to dismiss for failure to state a claim pursuant to Fed.R.Civ.P. 12(b)(6).

 

First and foremost, the Court must liberally construe all claims, accept all factual allegations in the complaint as true, and draw all reasonable inferences in favor of the plaintiff. See Cargo Partner AG v. Albatrans, Inc., 352 F.3d 41, 44 (2d Cir.2003); see also Roth v. Jennings, 489 F.3d 499, 510 (2d Cir.2007).

 

To survive a motion to dismiss, “a complaint must contain sufficient factual matter … to ‘state a claim to relief that is plausible on its face.’ “ Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (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.” Id. (citing Twombly, 550 U.S. at 556). “While a complaint attacked by a Rule 12(b)(6) motion to dismiss does not need detailed factual allegations, a plaintiff’s obligation to provide the grounds of his entitlement to relief requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555 (internal quotations, citations, and alterations omitted). Thus, unless a plaintiff’s well-pleaded allegations have “nudged [its] claims across the line from conceivable to plausible, [the plaintiff’s] complaint must be dismissed.”   Id. at 570; Iqbal, 129 S.Ct. at 1950–51.

 

*3 Additionally, any claims sounding in fraud must meet Rule 9(b)’s heightened pleading standard. See Fed.R.Civ.P. 9(b). To comply with Rule 9(b), a complainant “must: (1) specify the statements that the plaintiff contends were fraudulent, (2) identify the speaker, (3) state where and when the statements were made, and (4) explain why the statements were fraudulent.”   Lerner v. Fleet Bank, N.A., 459 F.3d 273, 290 (2d Cir.2006) (quoting Mills v. Polar Molecular Corp., 12 F.3d 1170, 1175 (2d Cir.1993) (internal quotation marks omitted).

 

Finally, in deciding a motion to dismiss, this Court may consider the full text of documents that are quoted in or attached to the complaint, or documents that the plaintiff either possessed or knew about and relied upon in bringing the suit. Rothman v. Gregor, 220 F.3d 81, 88–89 (2d Cir.2000) (citing Cortec Indus. Inc. v. Sum Holding L.P., 949 F.2d 42 (2d Cir.1991), cert. denied, 503 U.S. 960 (1992)); San Leandro Emergency Med. Group Profit Sharing Plan v. Philip Morris Cos., 75 F.3d 801, 808 (2d Cir.1996). “Plaintiffs’ failure to include matters of which as pleaders they had notice and which were integral to their claim-and that they apparently most wanted to avoid—may not serve as a means of forestalling the district court’s decision on the motion.” Cortec, 949 F.2d at 44; see also I. Meyer Pincus & Assocs. P .C. v. Oppenheimer & Co., 936 F.2d 759, 762 (2d Cir.1991) ( “[P]laintiff cannot evade a properly argued motion to dismiss simply because plaintiff has chosen not to attach the [document] to the complaint or to incorporate it by reference.”).

 

1. SIRVA’S Motion for Judgment on the Pleadings is Granted

No viable claim is asserted against SIRVA; literally the only allegation against it is that it is Allied’s (and, erroneously, Liffey’s) parent corporation. There is no allegations that it had anything to do with the transactions at issue, and no allegation of fact that would justify piercing the corporate veil between it and its subsidiaries. The allegations are insufficient to support a request for jurisdictional discovery; this court will not authorize a fishing expedition when plaintiffs have not offered a scintilla of support for piercing the corporate veil between Allied and its corporate parent. For that reason, SIRVA’s motion for judgment on the pleadings is granted and the complaint is dismissed as against it, with prejudice and without leave to replead.

 

2. The Carmack Amendment

The Carmack Amendment, 49 U.S.C. § 14706 et seq., addresses the liability of common carriers for goods lost or damaged during a shipment over which the Interstate Commerce Commission (now the Surface Transportation Board) has jurisdiction. It states that a motor carrier is liable “for the actual loss or injury to the property” and specifically allows a shipper to recover for the actual loss or injury caused by any of the carriers involved in the shipment. Id. §§ 14706(a)(1) & (d)(2).

 

*4 Because Congress intended the Carmack Amendment to create a uniform nationwide scheme of statutory remedies for carrier liability, the statute preempts state liability rules pertaining to cargo carriage, under either statutory or common law. As the Supreme Court long ago held, “Almost every detail of the subject is covered so completely [by the Carmack Amendment] that there can be no rational doubt but that Congress intended to take possession of the subject and supersede all state regulations with reference to it .” Adams Express Co., v. Croninger, 226 U.S. 491 (1913). The Second Circuit more recently said exactly the same thing, in Cleveland v. Beltman North American Co., Inc., 30 F.3d 373, 374 (2d Cir.1994), where it held that claims by a shipper for damages to good in interstate commerce is an “area of interstate commerce law that has been fully occupied by Congress’ passage of a statute delineating what remedies are available, leaving no room for additional state of federal common law causes of action.”

 

The shipper’s sole remedy under Carmack is a statutory cause of action against the carrier for breach of the transportation agreement. Furthermore, Carmack applies both to claims of damage or loss while goods are in interstate transit, but also to related services, including arranging for, receiving, delivering, storing, handling, packing and unpacking such goods.

 

Contrary to not providing plaintiffs with a remedy, as they seem to fear, the Carmack Amendment “imposes something akin to strict liability on shippers.”   Mitsui Sumitomo Insurance Co. Ltd. v. Evergreen Marine Corp., 621 F.3d 215, 216 (2d Cir.2010). It does, however, bar claims for emotional distress and fraud and claims relating to the claims process itself (including claims for insurance coverage), to cite several examples of plainly barred causes of action that are pleaded in the Brodys’ complaint. Rini v. United Van Lines, 104 F.3d 502 (1st Cir.1997).

 

3. Allied’s Motion for Judgment on the Pleadings is Granted

On the allegations of the complaint, plaintiffs’ claims against Allied Van Lines are limited to a statutory cause of action under Carmack. According to the complaint, Allied picked up the goods at Liffey’s warehouse and transported them to Palm Beach Gardens, Florida. Plaintiffs’ effort to “plead around” Carmack fails. The first count of the complaint is deemed amended to assert a claim against Allied (not SIRVA) for the value of the goods that were delivered to Palm Beach Gardens in damaged condition under Carmack. All other causes of action against Allied are dismissed.

 

4. Liffey’s Motion for Judgment on the Pleadings is Granted in Part and Denied in Part

So we turn to Liffey, the party with whom plaintiffs originally contracted.

 

To the extent that Liffey picked up the goods that eventually ended up in Florida at plaintiffs’ New York City apartment, stored and delivered them to Allied for transit, its activities plainly fall within the ambit of the Carmack Amendment, and plaintiffs’ claim is limited to a statutory action for breach of the transportation agreement. With respect to those goods, it was plaintiffs’ intent from the outset to ship them out-of-state, and Liffey’s activities, even if they took place entirely in New York State, were but one leg of a journey to out-of-state destinations. Bilyou v. Dutchess Beer Distributors, 300 F.3d 217 (2d Cir.2002). Plaintiffs are bound by the allegation of their First Cause of Action, in which they alleged that they entered into an express contract with “defendants” (a term that includes Liffey) “for the safe transport of their possessions from New York City to Palm Beach Gardens, Florida.” (Cplt. ¶ 35; see also Cplt. ¶ 8). Plaintiffs cannot now contend that Liffey was not engaged in interstate carriage with respect to their goods, and any state law claims against Liffey relating to that interstate carriage are preempted by Carmack. Therefore, Counts 1, 2, 4, 6, 8, 9, and 11—all of which relate specifically and exclusively to the goods shipped to Florida—are dismissed against Liffey as well.

 

*5 Plaintiffs specifically allege, however, that only some of the goods it picked up from their apartment were headed to Florida; the rest was allegedly to be stored in Liffey’s warehouse here in New York City, until such time as plaintiffs were ready to move their furniture into a new home here in New York City. Indeed, plaintiffs allege that this was the deal they originally made with Liffey. (Cplt.¶ 8). Plaintiffs argue that, at the very least, their state law claims with respect to this subset of their goods—asserted in the Third, Seventh and Tenth causes of action FN3—cannot be dismissed at the pleadings stage, because this aspect of their transaction between them and Liffey dealt entirely with intrastate pick-up, delivery and storage, and so is not preempted by Carmack.

 

FN3. At least one of these state law claims, and possibly two of them, will have to be dismissed eventually, since the same conduct cannot be both a breach of contract and a tort. See Wildenstein v.. 5H & Co, Inc., 950 N.Y.S.2d 3, 7 (1st Dep’t 2012).

 

Liffey counters that Carmack applies even to the intrastate portion of the transaction, for two reasons.

 

First, Liffey argues that Carmack applies to any carriage and related activities, even to intrastate carriage and attendant services, as long as the carriage is being performed by an “interstate carrier.” However, it does not appear that Liffey’s assertion about the reach of the Carmack Amendment is correct. 49 U .S.C. § 13501 sets out the reach of the Surface Transportation Board’s authority over motor carrier transportation and its procurement. By the statute’s terms the Board’s jurisdiction does not extend to all activities of “interstate carriers,” but rather to what I will call “interstate carriage.” The statute applies to transportation by motor carrier from one place in a state to another only when that transportation goes through another states (§ 13501(1)(B)). Margetson v. United Van Lines, Inc., 785 F.Supp. 917 (D.N.M.1991)—the only authority cited by Liffey for the proposition that wholly intrastate activities fall within Carmack if performed by an interstate carrier—says nothing of the sort. In fact, the carriage in Margetson was from Dallas, TX to Santa Fe, NM—interstate carriage.

 

There is no allegation in the Brodys’ complaint that so much of their household goods as were to be (1) removed from one New York City apartment, (2) stored in a New York City warehouse, and then (3) delivered to a different New York City apartment ever traveled outside of New York State. Nor is there any logical reason why these goods should have been shipped out of state. For this reason, plaintiffs argue that they have successfully pleaded around Carmack at least as to that limited portion of their goods.

 

Not so, counters Liffey. It notes that the Second Circuit has held that, where multiple carriers are responsible for different legs of a generally continuous shipment, the determination as to whether Carmack applies is based on the intended final destination of the shipment as that intent existed when the shipment commenced. Project Hope v. M/V Ibn Sina, 250 F.3d 67 (2d Cir.2001). And indeed, that is true—the Court of Appeals has held that, if the shipper’s intention to have goods delivered out-of-state was fixed before a motor carrier began transporting those goods as part of the “continuous movement of goods in interstate commerce,” then the fact that any particular carrier merely transported and/or stored those goods in a single state along the way does not take that carrier out of the ambit of Carmack. In other words, one looks to the entirety of the journey to decide whether interstate carriage or intrastate carriage is involved, and one considers what the shipper intended from the beginning.

 

*6 It should be obvious that I cannot grant Liffey’s motion for judgment on the pleadings on that ground, because it is not at all clear from the record before me that the Brodys had a fixed intention at the time they contracted with Liffey to ship all of their goods out of New York, or that all of their goods (as opposed to the portion of their goods entrusted to Allied) were ever put into a “continuous movement … in interstate commerce.” The paper record, while confusing, can be read to belie any such assertion.

 

In addition to the allegations of the complaint, which are to the effect that Liffey was hired to move all goods into intrastate storage and thereafter to deliver some to Florida and some within New York, I have (at Liffey’s particular request) examined the contract and related documents between Liffey and the Brodys. These documents were provided in their most legible form by plaintiffs’ counsel and are filed on ECF (Docket # 26 May 7, 2014).

 

In the January 26, 2010 quote letter that appears to be the first contract document, under the legend “Please Note,” it says, “If 1/2 of items shipped to West Palm Beach area at later date, estimated shipping charge of $4580 (delivery out of storage for local portion would be reduced accordingly ).” (Emphasis added). This letter, written by Liffey’s Director of Sales, Jim Clogston, seems to confirm the Brodys’ claim that they advised Liffey in advance that some of their goods were NOT going to be shipped out of state, but were a “local portion.” Additionally, there is no explicit mention of delivery to Palm Beach Gardens in the actual February 11, 2010 formal estimate, which all parties agree is the contract between Liffey and plaintiffs; the only additional stop specifically mentioned in Hewlitt, New York, on Long Island. Another estimate, dated February 23, 2010, advises that Liffey was to deliver a sofa and loveseat from storage to Brooklyn-again, within New York State. Even the first bill of lading indicating a destination in Palm Beach Gardens, FL, specifically references the fact that other furniture (including at least 2 couches) and 2 boxes will be delivered “at a later date;” the fair import of those words is that those particular pieces and boxes were not to be sent to Florida along with the bulk of the Brodys’ possessions.FN4

 

FN4. On the copy of this document, initialed 5/21/10, there is typing on top of typing under “Other Services Requested,” and I cannot make out the entire writing.

 

All of this differs from the bill of lading (464504) with Allied Van Lines, which specifies Florida delivery and contain no reference to partial shipments or the withholding of certain goods for later delivery. From the facts alleged in the complaint, I infer that Allied was brought in to handle the interstate portion of the move. There is no allegation that Allied was ever given custody of the goods that are referenced as needing to be delivered later, or that are alleged to have been intended as a “local portion.” One can interpret the paper record as indicating that Liffey kept a portion of the Brodys’ goods separate and apart from the goods that were intended to go to Florida. What I know of the transaction today suggests that it was a bifurcated deal, with Allied handling the interstate portion and Liffey the in-state portion.FN5

 

FN5. I am somewhat confused by a Liffey Van Lines Order dated July 19, 2010, which specifies that Liffey is to deliver a wall unit to Mrs. Brody, whose address is listed as 21 Walsh Lane in Greenwich, CT. Greenwich is not in New York State. Until the record is more fully developed, I cannot tell whether the Brodys’ new summer home (for I surmise that the Florida house is their winter home) really is in New York City, as alleged in the complaint, or is out of state. No doubt this will all be fleshed out during discovery.

 

*7 In short, whether Carmack bars the assertion of state law claims against Liffey cannot be determined on the pleadings. After discovery, it may be that Liffey will have a viable motion for summary judgment. If it does, I trust that its counsel will cite to some cases involving a single shipper who simultaneously consigns to a single carrier goods that are intended from the outset for two separate destinations: one out-of-state and one in-state.

 

I do sua sponte dismiss the claim for fraud relating to the New York “local portion” of the goods (Count 12) against Liffey, for failure to plead with particularity under Rule 9(b). This dismissal is of course without prejudice to repleading. However, plaintiffs and their counsel are warned: this court will be inclined to sanction the filing of any frivolous fraud pleading. The claim seems to be that plaintiffs were fraudulently induced to obtain insurance coverage for their goods, which has not been forthcoming. Plaintiffs need to plead the precise representations that were made to them. Also, it is not clear whether Liffey was self-insuring plaintiffs’ goods for full value or whether outside insurance was involved; and “insurance policy” is specifically pleaded. (Cplt.¶ 102).

 

CONCLUSION

The motions are decided as follows:

 

• All claims dismissed against SIRVA

 

• First Cause of Action: deemed repleaded as a Carmack claim against Allied and Liffey;

 

• Second Cause of Action: dismissed as against both Allied and Liffey

 

• Third Cause of Action: dismissed as against Allied but not Liffey

 

• Fourth Cause of Action: dismissed as against both Allied and Liffey

 

• Fifth Cause of Action: dismissed as against both Allied and Liffey

 

• Sixth Cause of Action: dismissed as against both Allied and Liffey

 

• Seventh Cause of Action: dismissed as against Allied but not Liffey

 

• Eighth Cause of Action: dismissed as against both Allied and Liffey

 

• Ninth Cause of Action: dismissed as against both Allied and Liffey

 

• Tenth Cause of Action: dismissed as against Allied but not Liffey

 

• Eleventh Cause of Action: dismissed as against both Allied and Liffey

 

• Twelfth Cause of Action: dismissed as against both Allied and Liffey.

 

All dismissals are with prejudice except for the dismissal of the Twelfth Cause of Action against Liffey, which may be repleaded. All other claims that are dismissed against both Allied and Liffey are barred by the Carmack Amendment.

 

This constitutes the decision and order of the Court. The Clerk of the Court is directed to remove Docket No. 13 from the Court’s list of pending motions.

 

United States District Court,

E.D. New York.

Trathony GRIFFIN, Michael Godwin and Frank Callace, Plaintiffs,

v.

SIRVA, INC., Allied Van Lines, Inc. and Astro Moving and Storage Company, Defendants.

 

No. 11–CV–1844 (MKB).

Signed May 29, 2014.

 

Stuart Lichten, Lichten & Bright, P.C., New York, NY, for Plaintiffs.

 

George W. Wright, Narinder S. Parmar, George W. Wright & Associates, LLC, Hackensack, NJ, Hyman Hacker, Albanese & Albanese LLP, Garden City, NY, for Defendants.

 

MEMORANDUM & ORDER

MARGO K. BRODIE, District Judge.

*1 Plaintiffs Trathony Griffin, Michael Godwin and Frank Callace bring the above-captioned action against Defendants Sirva, Inc. (“Sirva”), Allied Van Lines, Inc. (“Allied”), and Astro Moving and Storage Company (“Astro”), alleging violations of 42 U.S.C. § 1981, the New York State Human Rights Law, N.Y. Exec. Law § 296(15) (“NYSHRL”), the Fair Labor Standards Act, and the New York Labor Law. Plaintiffs Griffin and Godwin (“Plaintiffs”) moved for partial summary judgment against all Defendants on the issue of liability for their NYSHRL claim of discrimination based on their criminal history. Defendants Allied and Sirva moved for summary judgment on Plaintiffs’ NYSHRL claim for discrimination based on criminal history, which is the only claim asserted against them. For the reasons discussed below, the Court denies Plaintiffs’ partial summary judgment motion and grants Allied’s and Sirva’s summary judgment motion dismissing Plaintiffs’ NYSHRL claim as to them.

 

I. Background

 

a. Corporate relationships between Defendants and others

 

Sirva is a holding company of Sirva Worldwide, Inc. (“Sirva Worldwide”), Sirva Worldwide is the parent company of North American Van Lines, Inc. (“Van Lines”), and Van Lines is the parent company of Allied. (Defs. 56.1 ¶ 16.) Allied is a motor carrier company authorized by the Department of Transportation to “transport household goods and high-value commodities in interstate commerce.” (Id. ¶ 18.) Allied provides interstate moving services to the general public through its “disclosed household goods agents throughout the United States.” (Id. ¶ 19; Pls. Counter 56.1 ¶ 19.)

 

According to Defendants, Sirva “merely owns the outstanding stock of its subsidiary companies and does not produce products or provide services itself.” (Defs. 56.1 ¶ 17.) Sirva had no employment contract with Griffin or Godwin. (Id. ¶ 44; Pls. Counter 56.1 ¶ 44.) Plaintiffs claim that Sirva provides some services and “took numerous actions in this case.” (Pls. Counter 56.1 ¶¶ 17, 62.) Plaintiffs rely on three emails to support their claim of Sirva’s involvement in this case, which emails they allege indicate that Sirva played a role in, or had some responsibility for, establishing the background screening requirements that ultimately led to the loss of their employment. FN1

 

FN1. Plaintiffs’ Exhibit E contains Plaintiffs’ background investigation consent forms, which authorize Sirva and/or its agents to investigate the Plaintiffs’ background, criminal or police records, and public records. (Pl.Ex. E.) However, it was Sirva Worldwide, a non-party to this proceeding, that entered into the relevant agreement with HireRight Solutions, a background screening company, to provide the relevant background screening services. (Pl.Ex. D.) Plaintiffs’ Exhibit F is an email from HireRight to Astro regarding Griffin’s failed background screening and which states that Griffin did not meet the standards set forth by Sirva Worldwide. (Pl.Ex. F.) Plaintiffs’ Exhibit G is a copy of a letter from Astro to Godwin, which states that Sirva and its affiliated carriers, Allied and Van Lines, required “consumer reports” regarding potential laborers, and that Astro was enclosing a copy of the “consumer report” it obtained in conjunction with Godwin’s consideration for qualification. (Pl.Ex. G.)

 

Astro “provides local warehouse services and transportation services under its own authority from the New York State Department of Transportation.” (Defs. 56.1 ¶ 20; Pls. Counter 56.1 ¶ 20.) Pursuant to an agency contract (“Agency Contract”) between Allied and Astro, Astro acts as one of Allied’s “disclosed household goods agents” in New York with respect to Allied’s interstate transportation and related services. (Defs. 56.1 ¶ 32; Pls. Counter 56.1 ¶ 32.) “Household goods agents” are defined at 49 C.F.R. § 375.14 to include “agents who are permitted or required under the terms of any agreement or arrangement with a principal carrier to provide any transportation service for or on behalf of the principal carrier, including the selling of or arranging for any transportation service ….” 49 C.F.R. § 375.14.

 

*2 Under the Agency Contract, Allied is the carrier and Astro is its agent. An “agent” may “solicit, to estimate the weight, size and charges of, to collect charges for, to book, register, pack, crate, prepare for transportation, receive, load, transfer, unload, store, warehouse, deliver, and otherwise to service, in accordance with the terms applicable thereto, shipments of household goods and all other freight which CARRIER has authority to transport, and from time to time, as ditected or authorized by CARRIER to provide equipment; to bill for services and transport such shipments.” (Pls.Ex. B.) An agent may book and carry, or cause to be carried, shipments “so booked and registered” by the agent pursuant to the Carrier’s reasonable rates and regulations.FN2 (Id.) The Rules and Regulations provide that “all individuals who conduct the business of Allied at a customer’s home or place of business” must have successfully passed a criminal background screen or have satisfied other conditions as specifically approved by Allied. This policy includes but is not limited to laborers, packers, third party providers….” (Id.) An agency that violates this policy will be fined, and after three offenses, the agency principal must meet with Allied’s executive management. (Id.)

 

FN2. Plaintiffs’ Exhibit B includes a portion of the Allied Rules and Regulations, but due to the selective inclusion of pages in this exhibit, it is unclear whether these Rules and Regulations are explicitly incorporated into the contract. However, since the agent must act pursuant to the carrier’s rules and regulations, these rules and regulations would appear to be incorporated into the contract.

 

According to Defendants, Allied and Astro are entirely separate entities and do not share employees or common ownership or management.FN3 (Defs. 56.1 ¶ 31.) Allied does not control Astro’s local moving business, which is conducted under Astro’s own intrastate New York operating authority, nor does Allied control Astro’s employment policies or practices related to its own business. (Defs. 56.1 ¶ 33.) The Agency Contract provides that Allied and Astro have a principal-agent relationship, Astro’s employees are not employees of Allied, and Allied and Astro do not have a joint employer relationship with respect to the employees of either party. (Id. ¶¶ 34–35.) Allied has no authority to select or hire Astro’s employees and has never possessed such authority. (Id. ¶ 36.) Allied does not establish the salaries or benefits of Astro’s employees, make any payments to Astro’s employees, have the authority to discipline or dismiss Astro’s employees, control the conduct of Astro’s employees, or control the work schedules of, assign jobs to, or supervise the work of Astro’s employees. (Id. ¶¶ 36–40.) Allied does not share office space or its human resources department with Astro and does not maintain personnel records on Astro’s employees. (Id. ¶¶ 41–42.) Astro provides its own equipment when performing services as Allied’s disclosed household goods agent. (Id. ¶ 42.)

 

FN3. Plaintiffs contend that they lack sufficient information to admit or deny any of the facts in this paragraph. (Pl. 56.1 ¶¶ 31, 33–42.)

 

b. Plaintiffs’ employment history and prior convictions

Griffin began working for Astro in August 2008, and, through a referral by Griffin, Godwin began working for Astro in May 2010. (Defs. 56.1 ¶¶ 4, 11–12; Pls. Counter 56.1 ¶¶ 4, 11–12.) Both worked as “helpers,” which required them to pack household goods for transportation and move the goods into and out of Astro’s customers’ homes. (Defs. 56.1 ¶ 5; Pls. Counter 56.1 ¶ 5; Verderber Dep. 69:21–25, 74.) At the time Griffin was hired, Astro did not conduct background checks.

 

*3 On October 30, 1997, Griffin pleaded guilty to first degree child abuse and sexual misconduct for a sexual assault against a seven-year-old boy. (Defs. 56.1 ¶ 4; Pls. Counter 56.1 ¶ 4; Griffin Dep. 111:21–24.) He was sentenced to six to twelve years and served ten years. (Griffin Dep. 111:25–112:7.) Griffin is designated as a “Sexually Violent Offender,” is currently under the supervision of the New York State Division of Parole, and is not allowed to have contact with children under 18 years of age unless he is in the company of another adult. (Defs. 56.1 ¶ 79; Defs. Ex. M.) Griffin is required to report to the police every ninety days. (Griffin Dep. 141:4–6.)

 

On September 13, 1999, Godwin pleaded guilty to rape in the first degree and sexual abuse in the first degree involving an assault of a seven-year-old girl. FN4 (Defs. 56.1 ¶¶ 8, 75; Pls. Counter 56.1 ¶¶ 8, 75; Godwin Decl. ¶ 3.) Godwin was sentenced to nine years in prison and was released in 2008. (Defs. 56.1 ¶¶ 9, 80; Pls. Counter 56.1 ¶¶ 9, 80.) He remained on parole until May 2010. (Defs. 56.1 ¶ 10; Pls. Counter 56.1 ¶ 10.) Godwin is designated as a “Sexually Violent Offender.” His parole expired on August 4, 2011, subject to the condition that he have no contact with children under 18 years of age unless in the company of another adult.FN5 (Defs. 56.1 ¶ 81; Defs. Ex. N.)

 

FN4. Godwin also pleaded guilty to a misdemeanor count of endangering the welfare of a child. (Defs. 56.1 ¶ 75; Defs. Ex. L.)

 

FN5. The “Offender Details” of both Griffin and Godwin are posted on the New York Division of Criminal Justice (“NYDCJ”) website. (Defs. 56.1 ¶ 77; Pls. Counter 56.1 ¶ 77; see Defs. Exs. M–N.)

 

c. Certified Labor Program

According to Mark Davison, Sirva’s Director of Safety & Fleet Registration, Allied “requires its disclosed household goods agents’ representatives to enter customers’ homes or places of business and perform packing, moving and loading tasks in close proximity with the customers and their families or employees,” and the representatives “often have unsupervised contact with customers’ children, other family members and valuable personal property in their homes.” (Davison Decl. ¶¶ 7–8.) In Allied’s judgment, “allowing disclosed household goods agents to send convicted violent sex offenders into unsuspecting customers’ homes and businesses would create unreasonable risks of harm to the public served by Allied and to Allied’s business and public reputation.” FN6 (Id. at ¶ 10.) Like other major interstate van lines, Allied maintains labor qualification guidelines that must be met by the persons utilized by its disclosed goods agents, including Astro, to perform Allied’s moving services. (Id. at ¶ 11.)

 

FN6. Defendants assert that “[p]ersons hired to provide labor services in connection with [Allied’s] interstate moving jobs perform packing, moving and loading tasks inside customers’ homes where they are regularly in close, unsupervised contact with customers, their children and other family members and valuable property.” (Defs. 56.1 ¶ 96; Davison Decl. ¶¶ 7–8.) Plaintiffs disagree; Griffin states in his reply declaration that neither he nor Godwin “performed … tasks where they were regularly in unsupervised contact with children or relatives of customers.” (Pls. 56.1 ¶ 96; Godwin Reply Decl. ¶ 4.)

 

In 2006 Allied established a “Certified Labor Program” “requiring the contractors and employees of [Allied’s] disclosed household goods agents, including [Astro], to be screened for significant felony criminal histories that disqualify such contractors or employees from participating in [Allied’s] interstate moving jobs.” (Defs. 56.1 ¶ 50; Pls. Counter 56.1 ¶ 50; Davison Decl. ¶ 12.) On April 19, 2006, a Safety Release was issued to all Allied and North American Van Lines Agents, by the Mobile Agent Technology Director and the Safety Administration Director for Sirva,FN7 announcing the “Certified Labor Initiative” to require criminal background checks on all laborers used on all interstate household relocations in order to “ensure the highest quality service to [the] customer.” (Defs.Ex. E.) The Certified Labor Program was in effect during February 2011, as set forth in Allied’s Rules and Regulations, effective May 25, 2010. (Defs. 56.1 ¶ 51; Pls. Counter 56.1 ¶ 51; Defs. Ex. F.) According to the Certified Labor Program, all individuals who “conduct the business of Allied at [a] customer’s home or place of business … must have successfully passed a criminal background screen or have satisfied other conditions as specified by Allied,” and agents that fail to comply with the Certified Labor Program face fines and potential liability. (Defs. 56.1 ¶ 51; Pls. Counter 56.1 ¶ 51; Defs. Ex. F.)

 

FN7. It is unclear whether this was issued by Sirva or Sirva Worldwide.

 

*4 Allied maintained adjudication guidelines (“Adjudication Guidelines”) that were “used to determine the eligibility of its agents’ contractors and employees for participation in [Allied’s] interstate moving services,” and established “certain objective criteria for determining an applicant’s qualification for participation in [Allied’s] interstate services based on the level and age of an applicant’s criminal convictions.” (Defs. 56.1 ¶¶ 53–54; Pls. Counter 56.1 ¶¶ 53–54; Davison Decl. ¶¶ 15–16; see Defs. Ex. G.) Under the Adjudication Guidelines, an applicant’s “felony conviction for any (A) sexual offense; (B) kidnapping; (C) death related offenses; (D) attempted murder; (E) assault with a deadly weapon; (F) assault with intent to kill or (G) armed robbery, mandates the applicant’s permanent disqualification from any jobs performed by a disclosed household goods agent under [Allied’s] interstate authority.” (Defs. 56.1 ¶ 55; Pls. Counter 56.1 ¶ 55; Davison Decl. ¶ 17; see Defs. Ex. G.)

 

Under Allied’s Certified Labor Program standards, agents, including Astro, are responsible for ensuring that the laborers they supply for Allied jobs successfully pass a criminal background check conducted by a third-party investigative service. (Defs. 56.1 ¶ 60; Pls. Counter 56.1 ¶ 60; Davison Decl. ¶ 19.) Astro is free to hire anyone, regardless of criminal background, for its own intrastate moving services. (Defs. 56.1 ¶ 59.)

 

Sirva Worldwide entered into a Supplier Services Agreement with HireRight Solutions, Inc. (“HireRight”) effective August 24, 2010. (Defs. 56.1 ¶ 63; Pls. 56.1 Counter ¶ 63.) Under this agreement, HireRight provides background screening services to Allied and its disclosed household goods agents. (Defs. 56.1 ¶ 64; Pls. Counter 56.1 ¶ 64.) Allied’s disclosed household goods agents, such as Astro, request and pay for HireRight background checks for all contractors and employees assigned to jobs performed for Allied’s interstate transportation services. (Defs. 56.1 ¶ 65; Pls. Counter 56.1 ¶ 65.) When an Allied disclosed household goods agent requests HireRight to screen an individual, HireRight notifies the goods agent by email that the individual is qualified under Allied’s Certified Labor Program standards. (Defs. 56.1 ¶ 67; Pls. Counter 56.1 ¶ 67.) After the screening is complete, the agent may access HireRight’s Complete Report on the individual. (Defs. 56.1 ¶ 67; Pls. Counter 56.1 ¶ 67.) Allied has access to a database of the processed applicants, but HireRight does not send its complete reports to Sirva, Sirva Worldwide or Allied. (Defs. 56.1 ¶ 68; Pls. Counter 56.1 ¶ 68.) If an individual is not qualified, an agent may, in its discretion, continue employing the disqualified individual in the agent’s own moving business under the agent’s own operating authority, but the individual may not be used on Allied’s interstate business. (Defs. 56.1 ¶ 71.)

 

d. Background checks by Astro

*5 Even though the Certified Labor Program was announced in 2006, according to Keith Verderber, Astro’s Chief Executive Officer, Allied started asking Astro to conduct background checks on individuals working on Allied shipments in 2008–2009, and thereafter, Astro “needed to get [its employees] cleared to go on the particular jobs.” FN8 (Verderber Dep. 63:8–64:3; 64:17–22.) Griffin initially avoided giving permission for a background check. (Verderber Dep. 62:12–20.) Eventually Verderber “had to pin him down” so a background check could be conducted because otherwise “he would be very limited in working” for Astro. (Verderber Dep. 62:20–23.) On February 8, 2011, Griffin completed the background investigation consent form. (Defs. 56.1 ¶ 6; Pls. Counter 56.1 ¶ 6.) In response to a question asking whether he had “ever been convicted of any felony criminal offenses,” he admitted to having a “child abuse” conviction.FN9 (Defs. 56.1 ¶ 6; Pls. Counter 56.1 ¶ 6; Defs. Ex. I.) Godwin also completed a background investigation consent form in which he admitted to having a “rape” conviction in November 1998. (Defs. 56.1 ¶¶ 13, 86; Pls. Counter 56.1 ¶¶ 13, 86.) Both consent forms were submitted by Astro to HireRight in February 2011 for screening. (Defs. 56.1 ¶ 82; Pls. Counter 56.1 ¶ 82.) HireRight’s background checks on Griffin and Godwin disclosed that both had convictions for violent sexual offenses against young children, are registered sex offenders and remain under supervision. (Defs. 56.1 ¶ 72; Pls. 56.1 ¶ 72; see Defs. Exs. K, L.)

 

FN8. Verderber stated that, in addition to Allied’s request, Astro started conducting background checks because of “all the things that [had] been going on.” (Verderber Dep. 63:10–14.) He explained that “all these things going on” referred to the fact that “[p]eople go into homes, and go [ ] back to homes and rob[ ] the people after they do moves or steal [ ] jewelry,” and Astro “shouldn’t be sending into peoples [sic] homes” due to liability concerns. (Verderber Dep. 63:22–64:3.)

 

FN9. Although Griffin asserts that he “accurately completed” the background investigation consent form (Pl. 56.1 ¶ 6), in response to the question of whether he had been charged with a felony conviction, and, if so, what charges, (Defs.Ex. I.), Griffin listed his conviction as “child abuse” instead of first degree sexual misconduct with a minor, (id.).

 

e. End of Plaintiffs’ employment

According to Griffin, Astro terminated his employment a day or two after he completed the background investigation consent form. (Defs. 56.1 ¶¶ 7, 85; Pls. Counter 56.1 ¶¶ 7, 85.) According to Verderber, when Astro discovered that Griffin did not pass the background check, Verderber sought more information from Griffin. (Verderber Dep. 65:3–18.) Griffin first told Verderber that “he was 17 and the girl was 15.” (Id. at 65:20–22.) Astro then conducted internet research and discovered that Griffin “violently raped a seven year-old boy.” (Id. at 67:22–68:3.) Verderber confronted Griffin, who stated that “it was a disgruntled boyfriend or husband that he was with his girlfriend at the time who had a kid.” (Id. at 68:5–8.) Verderber advised Griffin that he would be “very limited in his job actions or jobs because [Verderber] couldn’t send him into somebody’s home ….” (Id. at 68:8–11.) Verderber could not send Plaintiff out on Allied shipments because Verderber “would probably get fined if the situation ever happened.” FN10 (Id. at 66:22–2.) Verderber informed Griffin that he “could only go on limited jobs such as a commercial job which is not household goods, not going in somebody’s home,” but that work was limited because Astro “didn’t have much of it.” (Id. at 68:6–14.) Since Griffin would be limited in the number of jobs he would be assigned to, his average weekly hours would decrease. (Id. at 68:24–69:13.) Griffin replied that Verderber would “hear from [his] lawyer.” (Id. at 68:15–16.) According to Verderber, Griffin was not terminated. (Id. at 68:17–21.)

 

FN10. Allied sent Verderber a letter stating that “anybody put on [Allied] shipments that did not have a background check who was hired and put on it would be fined.” (Verderber Dep. 67:21–24.) Therefore, Griffin could not have worked on any Allied shipments. (Id. at 73:6–9.)

 

*6 Godwin also failed his background check, and, as a result, Astro terminated his employment. (Defs. 56.1 ¶ 14; Pls. Counter 56.1 ¶ 14; Verderber Dep. 72:2–13.) Astro advised Godwin that, based on his criminal record, Astro could not allow him to enter customers’ homes. (Defs. 56.1 ¶ 15; Pls. Counter 56.1 ¶ 15.) According to Verderber, Godwin was not offered the same opportunity as Griffin to explain his failed background check or to continue to work for Astro. (Verderber Dep. 72:14–24.) Verderber responded differently to Griffin and Godwin’s failed background checks because he “had a longer relationship” with Griffin, but he felt he “couldn’t do anything else with” Godwin. (Id.) Verderber determined that Godwin could not have worked on any non-Allied shipments due to liability concerns. (Id. at 73:10–14.)

 

II. Discussion

 

a. Standard of Review

 

Summary judgment is proper only when, construing the evidence in the light most favorable to the non-movant, “there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a); see also Bronzini v. Classic Sec., L.L.C., ––– F. App’x ––––, ––––, 2014 WL 943933, at *1 (2d Cir. Mar.12, 2014); Kwan v. Andalex Grp. LLC, 737 F.3d 834, 843 (2d Cir.2013); Kwong v. Bloomberg, 723 F.3d 160, 164–65 (2d Cir.2013); Redd v. N.Y. Div. of Parole, 678 F.3d 166, 174 (2d Cir.2012). The role of the court is not “to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial.” Cioffi v. Averill Park Cent. Sch. Dist. Bd. of Educ., 444 F.3d 158, 162 (2d Cir.2006) (quoting Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986)). A genuine issue of fact exists when there is sufficient “evidence on which the jury could reasonably find for the plaintiff.” Anderson, 477 U.S. at 252. The “mere existence of a scintilla of evidence” is not sufficient to defeat summary judgment; “there must be evidence on which the jury could reasonably find for the plaintiff.” Id. The court’s function is to decide “whether, after resolving all ambiguities and drawing all inferences in favor of the non-moving party, a rational juror could find in favor of that party.” Pinto v. Allstate Ins. Co., 221 F.3d 394, 398 (2d Cir.2000).

 

b. Plaintiffs’ motion for partial summary judgment

Plaintiffs Griffin and Godwin assert that all three Defendants violated the NYSHRL by terminating them because of their criminal convictions. (Compl.¶ 23.) Plaintiffs argue that their termination for failure to meet the Adjudication Guidelines was a per se violation of NYSHRL § 296(15) and New York Corrections Law § 752 because the Adjudication Guidelines did not take into account all of the enumerated factors set forth in Corrections Law § 753. Plaintiffs argue that, because the Adjudication Guidelines applied universally, and termination was automatic rather than individualized in accordance with the statutory factors, the application of those Adjudication Guidelines violates the NYSHRL and entitles them to judgment as a matter of law.FN11

 

FN11. Plaintiff initially moved for partial summary judgment on a second ground, arguing that Defendants unlawfully denied Plaintiffs employment because of their criminal records. (Pl.Mem.6.) However, Plaintiffs withdrew this argument because of the “sharp dispute of fact concerning the nature of the laborer positions held by Griffin and Godwin.” (Pl. Opp’n Mem. 12.) Plaintiffs “now recognize that material disputes of fact preclude summary judgment” on this issue and argue that whether “proper consideration of the factors would bar Griffin and Godwin from employment must go to the jury.” (Id.)

 

i. Legal Framework

*7 The NYSHRL “limits the ability of employers to make employment decisions adverse to employees or job applicants on the basis of criminal history” and “provides protection even after conviction, based on a public policy of welcoming those formerly convicted back into the labor force.” Smith v. Bank of Am. Corp., 865 F.Supp.2d 298, 302–03 (E.D.N.Y.2012). The statute provides, in pertinent part:

 

It shall be an unlawful discriminatory practice for any person, agency, bureau, corporation or association … to deny any license or employment to any individual by reason of his or her having been convicted of one or more criminal offenses, or by reason of a finding of a lack of “good moral character” which is based upon his or her having been convicted of one or more criminal offenses, when such denial is in violation of the provisions of article twenty-three-A of the correction law.

 

N.Y. Exec. Law § 296(15). This provision incorporates Article 23–A of New York Correction Law, which governs the licensure and employment of persons previously convicted of one or more criminal offenses. Article 23–A of the New York Correction Law provides in pertinent part:

No application for any license or employment, and no employment or license held by an individual, to which the provisions of this article are applicable, shall be denied or acted upon adversely by reason of the individual’s having been previously convicted of one or more criminal offenses, or by reason of a finding of lack of ‘good moral character’ when such finding is based upon the fact that the individual has previously been convicted of one or more criminal offenses, unless:

 

(1) there is a direct relationship between one or more of the previous criminal offenses and the specific license or employment sought or held by the individual; or

 

(2) the issuance or continuation of the license or the granting or continuation of the employment would involve an unreasonable risk to property or to the safety or welfare of specific individuals or the general public.

 

N.Y. Correct. Law § 752.FN12 “The Legislature has clarified that a direct relationship [between the prior criminal offense and the license or employment sought] means that the nature of [the] criminal conduct for which the person was convicted has a direct bearing on his fitness or ability to perform one or more of the duties or responsibilities necessarily related to the license, opportunity, or job in question.” Acosta v. New York City Dep’t of Educ., 16 N.Y.3d 309, 315, 921 N.Y.S.2d 633, 946 N.E.2d 731 (2011) (citations and internal quotation marks omitted). As to the meaning of “unreasonable risk,” “the Legislature has not provided a statutory definition of the phrase ‘unreasonable risk’ in this context ‘for the obvious reason that a finding of unreasonable risk depends upon a subjective analysis of a variety of considerations relating to the nature of the license or employment sought and the prior misconduct.’ ” Id . (quoting Matter of Bonacorsa v. Van Lindt, 71 N.Y.2d 605, 612, 528 N.Y.S.2d 519, 523 N.E.2d 806 (1988)). In making a determination as to whether either the “direct relationship” exception or the “unreasonable risk” exception applies, an employer is required to consider the following factors:

 

FN12. Although Astro did not separately move for summary judgment, in its memorandum of law in support of Allied’s and Sirva’s motion and in opposition to Plaintiffs’ motion, Astro argues that this claim must be dismissed because Article 23–A of New York Correction Law does not provide for a private cause of action. Astro is correct that Article 23–A does not provide for a private cause of action. With regard to actions by private employers, Article 23–A is enforceable by the New York State Division of Human Rights and the New York City Commission on Human Rights. See N.Y. Correct. Law § 755. However, as discussed above, because Plaintiffs bring this cause of action pursuant to the section of the New York State Human Rights Law which incorporates Article 23–A, and the New York State Human Rights Law does provide for a private cause of action, Plaintiffs can proceed with this claim. See N.Y. Exec. Law § 297(9) (providing that any person “aggrieved by an unlawful discriminatory practice” may sue in a court of competent jurisdiction); Smith v. Bank of Am. Corp., 865 F.Supp.2d 298, 304 (E.D.N.Y.2012); Pelaez v. Life Alert, Inc., No. 09–CV–1668, 2011 WL 1321999 (E.D.N.Y. Mar. 30, 2011); see also Clemons v. WellPoint Companies, Inc., No. 11–CV–0084, 2013 WL 1092101 (N.D.N.Y. Mar. 15, 2013) (plaintiffs asserted N.Y. Executive Law § 296(16) claim, which prohibits unlawful inquiry into an individual’s criminal history, against their employer Wellpoint Companies, Inc., a healthcare company).

 

*8 (a) The public policy of this state, as expressed in this act, to encourage the licensure and employment of persons previously convicted of one or more criminal offenses.

 

(b) The specific duties and responsibilities necessarily related to the license or employment sought or held by the person.

 

(c) The bearing, if any, the criminal offense or offenses for which the person was previously convicted will have on his fitness or ability to perform one or more such duties or responsibilities.

 

(d) The time which has elapsed since the occurrence of the criminal offense or offenses.

 

(e) The age of the person at the time of occurrence of the criminal offense or offenses.

 

(f) The seriousness of the offense or offenses.

 

(g) Any information produced by the person, or produced on his behalf, in regard to his rehabilitation and good conduct.

 

(h) The legitimate interest of the public agency or private employer in protecting property, and the safety and welfare of specific individuals or the general public.

 

N.Y. Correct. Law § 753(1).

 

ii. Analysis

It is undisputed that Plaintiffs were hired and were advised later that they had to submit to a background check. After Plaintiffs failed the background checks, they ceased employment at Astro. There is a dispute as to whether Griffin was terminated, but it is undisputed that Godwin was terminated. Plaintiffs request partial summary judgment on the grounds that, because the Adjudication Guidelines applied automatically to someone with their criminal convictions, the Adjudication Guidelines per se violated the NYSHRL, since the application of the Adjudication Guidelines was not individualized, entitling them to judgment as a matter of law. For the following reasons, Plaintiffs’ motion for partial summary judgment is denied.

 

1. Allied and Sirva

Allied and Sirva were not Plaintiffs’ employer, see Part II.b.ii.C, nor did they cause Plaintiffs’ terminations. Therefore, Allied and Sirva are not liable to Plaintiffs under the NYSHRL. Allied required its agents, including Astro, Plaintiffs’ employer, to allow only those individuals who had successfully passed a background screening to work on any Allied jobs. Allied did not require that individuals who did not pass the background screening be fired. These individuals were only not allowed to work on Allied shipments. Although this fact influenced Astro’s decision as to whether or not to terminate Plaintiffs, Allied and Sirva did not terminate Plaintiffs nor did they require their termination. Thus, Plaintiffs’ motion for summary judgment as to Allied and Sirva is denied.

 

2. Astro

Plaintiffs’ motion for summary judgment as to Astro is also denied. The parties do not dispute that Astro was Plaintiffs’ employer. However, the parties dispute whether Griffin was terminated. Viewing the facts in the light most favorable to Defendants, as the Court is required to do in considering Plaintiffs’ summary judgment motion, there is a genuine dispute of material fact as to whether Griffin was terminated. According to Verderber, he planned to continue employing Griffin, because he had known him for a long period of time, but Griffin decided to leave once he discovered he would not be allowed to work on Allied’s jobs. Thus, a reasonable jury hearing Verderber’s testimony could conclude that Griffin was not terminated by Astro but rather decided to leave after he was told that he could no longer work on jobs belonging to Allied. This material issue of fact as to whether Griffin was terminated by Astro, precludes the court from granting Griffin’s summary judgment motion.

 

*9 Even if this Court were to assume that Griffin was in fact terminated, the Court has not found, and Plaintiffs have not cited to, any legal support for Plaintiffs’ argument that the failure to comply with the requirements of § 753 constitutes a per se violation of the NYSHRL, entitling Plaintiffs to judgment as a matter of law. A plain reading of § 753 requires an employer to consider all eight of the listed factors. See Acosta, 16 N.Y.3d at 316, 921 N.Y.S.2d 633, 946 N.E.2d 731 (“A failure to take into consideration each of these factors results in a failure to comply with the Correction Law’s mandatory directive.”). There is limited caselaw concerning a private employer’s failure to consider all eight of § 753’s enumerated factors. In the public context, New York courts have determined that the failure of an agency to consider all eight factors is an abuse of discretion. See id. at 318, 921 N.Y.S.2d 633, 946 N.E.2d 731 (“It is, of course, improper for courts to ‘engag[e] in essentially a re-weighing’ of the Correction Law § 753 factors, but, on this record, it is plain that the DOE failed to consider all of the factors in making its determination as to whether the unreasonable risk’ exception applied to petitioner’s application, rendering its denial of that application arbitrary and capricious.” FN13 (emphasis added) (citation omitted)); Exum v. New York City Health & Hospitals Corp., 964 N.Y.S.2d 58 (Sup.Ct.2012) (“The Court finds that since all the factors enumerated in Correction Law § 753 were not properly addressed and considered, the determination that petitioner must be disqualified is arbitrary, capricious, and erroneous as a matter of law.”); Soto v. New York State Office of Mental Retardation & Developmental Disabilities, 907 N.Y.S.2d 104 (Sup.Ct.2010) (“The failure of an agency to properly consider Correction Law § 753 factors will render its decision to deny licensure or employment as arbitrary, capricious and an abuse of discretion.”); Black v. New York State Office of Mental Retardation & Dev. Disabilities, 20 Misc.3d 581, 858 N.Y.S.2d 859, 862 (Sup.Ct.2008) (“When all eight factors set forth in Correction Law § 753 are considered in making a determination pursuant to Correction Law § 752 concerning employment of a person with a criminal conviction and the positive factors are balanced against the negative factors, the resulting decision is neither arbitrary nor capricious nor does it constitute an abuse of discretion.”); see also Formica Constr., Inc. v. Mintz, 65 A.D.3d 686, 885 N.Y.S.2d 298, 300 (App.Div.2009) (the Supreme Court properly annulled the decision of the New York Department of Consumer Affairs to a construction contractor’s application to renew his license based on his recent felony conviction, where the DCA did not set forth its reasoning for its determination until it was compelled to do so by commencement of Article 78 proceeding, and the reasoning that DCA articulated in its answer to petition did not reflect that it considered all eight statutory factors).

 

FN13. Astro argues that the court in Acosta independently reviewed the background of the petitioner in order to conclude that the rejection of the petitioner’s employment application failed to comply with the statute, and that “if the background of the petitioner independently would have supported the decision to deny petitioner’s application it appears that the Court would not have found it to be arbitrary and capricious and would have sustained it.” (Astro Mem. 7.) However, this is not entirely clear. First, the court in Acosta specifically stated that the court was not to re-weigh the factors, and highlighted the fact that the evidence showed that the defendant failed to consider all eight factors. Second, here, the action is against a private employer and therefore not subject to arbitrary and capricious review.

 

*10 Where an agency’s decision is determined to be arbitrary and capricious, the decision is remanded to the agency for a consideration of all eight factors. See El v. New York City Dep’t of Educ., 886 N.Y.S.2d 70 (Sup.Ct.2009) (“The appropriate remedy is a remand to the Board for a detailed consideration of all eight factors ….”); La Cloche v. Daniels, 195 Misc.2d 329, 755 N.Y.S.2d 827, 831 (Sup.Ct.2003) (Secretary of State could not deny plaintiff’s application solely on the basis of basis of a prior conviction “without inquiry into the factors set forth in Correction Law § 753,” and therefore proceeding was remanded for rehearing). The remedy for a private employer’s failure to consider all eight of § 753’s enumerated factors is less clear.

 

Here, Defendants did not evaluate all eight factors at the time of Plaintiffs’ termination and, thus, violated § 753 of the New York Correction Law. See Acosta, 921 N.Y.S.2d 633, 946 N.E.2d at 733 (“A failure to take into consideration each of these factors results in a failure to comply with the Correction Law’s mandatory directive.”). However, it does not follow that a violation of New York Correction Law is a per se violation of the NYSHRL. The central purpose of judicial review of employment decisions is to ensure that conclusions are not based on “speculative inferences unsupported by the record.” Soto, 907 N.Y.S.2d at 104. Without the ability to remand for a redetermination with consideration of all of § 753’s factors, the Court finds that the proper course of action is to evaluate whether, applying the required balancing of factors, Astro would have terminated Plaintiffs’ employment. As Plaintiffs now agree, (Pl. Reply 7–8), this inquiry involves disputed facts and, thus, is inappropriate for determination by the Court. Cf. Acosta, 946 N.E.2d at 634–35 (a “finding of unreasonable risk depends upon a subjective analysis of a variety of considerations”). Plaintiffs’ motion for partial summary judgment is denied.

 

c. Defendants’ Motion for Summary Judgment

Allied and Sirva assert that they cannot be held liable for any alleged violation of NYSHRL because they do not qualify as Plaintiffs’ employers under the law. Allied and Sirva also argue that even assuming they were employers under the NYSHRL, Plaintiffs’ terminations were lawful, because the Adjudication Guidelines took the § 753 considerations into account by removing employees with prior violent sexual offenses against minors from situations where they would enter homes with children, and that application of all of the required factors clearly indicates that Plaintiffs’ criminal convictions directly related to their employment. Allied and Sirva further argue that, assuming that they qualify as employers under NYSHRL, Plaintiffs’ discrimination claim based on their prior criminal convictions is preempted by the Federal Aviation Administration Authorization Act of 1994, 108 Stat. 1605–1606, as amended and recodified as part of the Interstate Commerce Commission Termination Act of 1995, 49 U.S.C. § 14501(c). The Court concludes that Allied and Sirva are not Plaintiffs’ employees and are therefore not subject to liability under § 296(15).FN14

 

FN14. Because the Court finds that Allied and Sirva are not Plaintiffs’ employers, the Court does not address Allied’s and Sirva’s alternative arguments in support of their motion.

 

i. Allied and Sirva are not Plaintiffs’ employers

*11 Allied and Sirva argue that they cannot be held liable because they were not Plaintiffs’ employers. (Defs.Mem.14.) Under the NYSHRL, liability for employment discrimination based on criminal history may be imposed on “any person, agency, bureau, corporation or association” who “den[ies] … employment to any individual by reason of his or her having been convicted of one or more criminal offenses …, when such a denial is in violation of article twenty-three-A of the correction law.” FN15 N.Y. Exec. Law § 292(15). The term “person” includes one or more individuals, partnerships, associations, corporations, legal representatives, trustees, trustees in bankruptcy, or receivers.” N.Y. Exec. Law § 292(1).

 

FN15. New York Corrections Law § 751 only applies to the individual’s employer. Soto v. New York State Office of Mental Retardation & Developmental Disabilities, 907 N.Y.S.2d 104, 104 (Sup.Ct.2010) (“Correction Law § 751 applies Article 23—A to any public or private employer.”). Under New York Corrections Law, a “private employer” means “any person, company, corporation, labor organization or association which employs ten or more persons.” N.Y. Correct. Law § 750(2).

 

Plaintiffs argue that because § 296(15) on its face is not strictly limited to employers, as compared to other provisions of § 296, whether Allied and Sirva were Plaintiffs’ employers is “wholly immaterial.” (Pl. Opp’n 9.) Allied and Sirva argue that § 296(15)’s plain meaning is that no employer may “deny employment,” since only an employer can deny employment. (Defs. Reply 10.) Therefore, argue Allied and Sirva, Plaintiffs must show that they qualified as employers under the NYSHRL. See Idlisan v. NYS Dep’t of Taxation & Fin., No. 12–CV–1787, 2013 WL 2898050, at *5 (N.D.N.Y. June 13, 2013) (dismissing the plaintiff’s § 296(15) claim against a non-employer individual recruiter because the plaintiff failed to allege that the recruiter had any ownership interest in the employer or any power other than to carry out personnel decisions made by others). Plaintiffs argue that, because they need not prove that Allied and Sirva were Plaintiffs’ employers, Plaintiffs “need only establish that the companies denied them employment or compelled Astro to deny them employment.” (Pl. Opp’n 9.) The Court agrees with both parties. As argued by Plaintiffs, the Court finds that Plaintiffs must show that Allied and Sirva denied them employment. However, as argued by Allied and Sirva, the Court finds that to “deny employment,” the denying entity must be an employer as understood by the caselaw interpreting the NYSHRL. See Acosta, 16 N.Y.3d at 320, 921 N.Y.S.2d 633, 946 N.E.2d 731 (“The Legislature has determined that, as a general rule, it is unlawful for a public or private employer to deny an application for a license or employment on the ground that the applicant was previously convicted of a crime.” (emphasis added)).

 

In interpreting the scope of “employer” as defined under § 296 to include individuals other than an employee’s direct employer, courts have required a showing “that [the] person has: (1) any ownership interest in the employer; or (2) the power to do more than carry out personnel decisions made by others.”   Scalera v. Electrograph Sys., Inc., 848 F.Supp.2d 352, 371 (E.D.N.Y.2012); see Lore, 670 F.3d at 169 (holding, with regard to plaintiff’s § 296(15) claim, that no individual may be held liable “if he is not shown to have any ownership interest or any power to do more than carry out personnel decisions made by others.” (quoting Tomka v. Seiler Corp., 66 F.3d 1295, 1314–15 (2d Cir.1995)). In order to determine whether an individual defendant has sufficient authority under the second prong, courts employ the “economic realities” test, and balance “whether the alleged employer (1) had the power to hire and fire employees, (2) supervised and controlled employee work schedules or conditions of employment, (3) determined the rate and method of payment, and (4) maintained employment records.” Scalera, 848 F.Supp.2d at 371 (quoting Herman v. RSR Sec. Servs. Ltd., 172 F.3d 132, 139 (2d Cir.1999)). “Conversely, individuals may be held liable if they ‘actually participate[ ] in the conduct giving rise to a discrimination claim.’ ” Lore, 670 F.3d at 169 (quoting Tomka, 66 F.3d at 1314–15).

 

*12 It is also “an unlawful discriminatory practice for any person to aid, abet, incite, compel or coerce the acts forbidden … or to attempt to do so.” N.Y. Exec. Law § 296(6).FN16 “This, again, requires that the defendant actually participated in the conduct giving rise to the claim of discrimination, and that the aider and abettor share the intent or purpose of the principal actor.” Idlisan, 2013 WL 2898050, at *4–5 (internal quotation marks omitted) (quoting Robles v. Goddard Riverside Cmty. Ctr., No. 08–CV–4856, 2009 WL 1704627, at *3 (S.D.N.Y. June 17, 2009) (citations omitted)); see also Tomka, 66 F.3d at 1317 (“a defendant who actually participates in the conduct giving rise to a discrimination claim may be held personally liable under the [NYS]HRL”). When a plaintiff seeks to sue an additional defendant, other than a direct employer, and that additional defendant is a business, courts have also applied the four economic realities factors to determine whether the two companies are “joint employers.” See Voltaire v. Home Servs. Sys., Inc., 823 F.Supp.2d 77, 97 (E.D.N.Y.2011) (explaining the use of the four factors to determine whether two entities are “joint employers” for purposes of the NYSHRL, and noting that the most essential factor is whether the second entity had the power to control the employee’s conduct).

 

FN16. Allied and Sirva argue that it is improper for Plaintiffs to raise an “aiding and abetting” cause of action pursuant to § 296(6) for the first time in opposition to their motion for summary judgment, because “aiding and abetting” is an independent cause of action separate from a cause of action for primary liability, and Plaintiffs “belated attempt to raise this claim for the first time in its opposition is improper.” (Defs. Reply 13.) Section 296(6) is not a standalone cause of action, it is only viable in conjunction with a forbidden act stated in another provision of § 296. Although Plaintiffs’ Complaint does not expressly identify § 296(6) as a basis of liability, Plaintiffs have always alleged that Allied’s and Sirva’s actions constituted the denial of employment because of Plaintiffs’ criminal convictions. In Plaintiffs’ memorandum in support of their motion for partial summary judgment, they specifically stated that Astro acted “at the direction of Sirva and Allied.” (Pls.Mem.6.) Therefore, the Court does not find that the aiding and abetting cause of action is raised for the first time in Plaintiffs’ opposition to Defendants’ motion for summary judgment. In any event, the prohibition against recognizing arguments raised for the first time in a motion brief is only prudential. See Keefe on Behalf of Keefe v. Shalala, 71 F.3d 1060, 1066 (2d Cir.1995) (“Normally, we will not consider arguments raised for the first time in a reply brief, let alone after oral argument.” (emphasis added)).

 

Allied and Sirva had no employment relationship with Plaintiffs. Neither did Allied or Sirva have any ownership interest in Astro, Plaintiffs’ employer. See Nicholson v. Staffing Auth., No. 10–CV–2332, 2011 WL 344101, at *2 (S.D.N.Y. Feb. 1, 2011) (“In Patrowich v. Chemical Bank, the New York Court of Appeals defined ‘employer’ narrowly to include only an individual ‘shown to have an ownership interest in [the business employing the plaintiff] or power to do more than carry out personnel decisions made by others.’ ” (alteration in original)). Nor did Allied and Sirva have any other liability-engendering authority over Plaintiffs. See Scalera, 848 F.Supp.2d at 371 (under the economic realities test, four factors must be balanced: whether one “(1) had the power to hire and fire employees, (2) supervised and controlled employee work schedules or conditions of employment, (3) determined the rate and method of payment, and (4) maintained employment records.”). Allied and Sirva did not have the authority to hire or fire Godwin or Griffin. Cf. Voltaire v. Home Servs. Sys., Inc., 823 F.Supp.2d 77, 97 (E.D.N.Y.2011) (issues of fact as to whether separate entity could be considered plaintiff’s joint employer where the entity also interviewed plaintiff, had the ability to approve her hiring, and the entity “may have had some control over whether employees were dismissed or retained). Nor have Plaintiffs presented any evidence that Allied or Sirva controlled their work schedules, determined their rate or method of payment or maintained any of their employment records.

 

*13 According to Thomas Lambert, Director of Agency Services at Allied, Allied did not instruct Astro to terminate Griffin’s or Godwin’s employment and no one had any advance notice of the termination of their employment. (Lambert Decl. ¶ 20.) Plaintiffs dispute this statement and assert that Allied informed Astro that Griffin and Godwin could not conduct any business on behalf of Allied. (Pls. Counter 56.1 ¶ 45.) However, rather than disprove Allied’s position, Plaintiffs’ argument further supports Allied’s claim that it had no authority to fire Griffin or Godwin—Allied simply had the authority to exclude them from working on Allied’s assignments. Allied and Sirva did not supervise or control Griffin’s or Godwin’s work schedules or conditions of employment. They did not determine the rate and method of payment. They did not maintain employment records, and they did not exercise control over the employees of Astro.

 

Sirva is the parent company of Van Lines, which is the parent company of Allied. Sirva has no contractual relationship with Astro, and Allied’s relationship with Astro is purely contractual. The Allied–Astro agency contract specifically disavows any joint employer relationship between Allied and Astro. Although Allied requires Astro and other agents to provide screened, qualified individuals to work on Allied’s shipments, Allied does not control the employees. In fact, both Griffin and Godwin testified at their depositions that they had no direct communication with Allied. See, e.g., Dinah v. Salzman Electric Co., Inc., 2005 N.Y. Misc. LEXIS 3591 (Sup.Ct.2005) (contractor who determined that sub-contractor’s employee could not work at any of its job site did not qualify as an employer under the NYSHRL because the contractor did not set the plaintiff’s wage, collect taxes, provide insurance or other benefits for plaintiff).

 

Even under the “aiding and abetting” standard, the evidence does not establish that Sirva or Allied denied Griffin or Godwin employment. Allied and Sirva established the Certified Labor Program that applied nationally and required their agents to run a background check on any individual who worked on an Allied delivery. Under the Adjudication Guidelines, a felony conviction for any sexual offense permanently disqualified the individual from any jobs performed under Allied interstate authority. However, Allied did not require the termination of any disqualified individual, and an agent, such as Astro, could continue to employ the individual and assign him to jobs conducted under the agent’s own authority. Therefore, at most, Allied and Sirva were responsible for, or caused, a change in Griffin’s and Godwin’s job responsibilities. They did not cause Griffin and Godwin to be denied employment. Astro made separate employment decisions respecting Griffin and Godwin, which decisions, according to Astro, were based on (1) the practical reality that any individual who could not work on Allied projects would not be able to work on 70–80% of Astro’s projects, and (2) Astro’s own determination that it was not safe or wise to send convicted sex offenders into people’s homes, where they could be left alone unsupervised. (Defs. 56.1 ¶ 15; Pls. Counter 56.1 ¶ 15; Verderber Dep. 66:22–2, 68:8–14.) The fact that Allied informed Astro that Griffin and Godwin could not conduct any business on behalf of Allied is not sufficient to attribute liability to Sirva or Astro.

 

*14 No genuine dispute as to any material fact exists concerning Allied and Sirva’s liability under NYSHRL. Therefore, Allied’s and Sirva’s motions for summary judgment are granted.

 

III. Conclusion

For the reasons discussed above, the Court denies Plaintiffs’ partial summary judgment motion and grants Allied’s and Sirva’s summary judgment motion, dismissing Plaintiffs’ NYSHRL claim against them and dismissing them from this action.

 

SO ORDERED.