# City Calibration Centers, Inc. v. Heath Consultants Inc.

> District Court, E.D. New York · March 29, 2024

URL: https://www.frixlaw.com/law-library/cases/10311509

## Case

- **Court:** District Court, E.D. New York
- **Decided:** March 29, 2024
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/10311509

## How later opinions describe it (automated extraction)

- finding the weight of authority “requires a plaintiff to identify the potential customers at issue when asserting a cause of action for interference with prospective economic advantage”
- holding factual assertions coupled with conclusory allegations that defendants “knew or should have known” or “knew but concealed” are “so broad and conclusory as to be meaningless”
- finding choice-of-law provision that read “[t]his Agreement shall be governed by, and construed in accordance with, the laws of the State of New York . . . fits to a tee the sort of contractual language that courts applying New York law have held insufficient to cover tort cla…

## Opinion text

UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF NEW YORK
--------------------------------X
CITY CALIBRATION CENTERS INC, and
PLATSKY COMPANY, INC,
MEMORANDUM & ORDER
Plaintiffs, 22-CV-7845 (JS)(ST)

-against-

HEATH CONSULTANTS INC.,

Defendant.
--------------------------------X
APPEARANCES
For Plaintiffs: Steven R. Schlesinger, Esq.
Jillian Lee McNeil, Esq.
Stanley A. Camhi, Esq.
Jaspan, Schlesinger & Hoffman, LLP
300 Garden City Plaza, Fifth Floor
Garden City, New York 11530

For Defendant: Jeremy Evan Deutsch, Esq.
Elliot James Coz, Esq.
Hallie McDonald, Esq.
Cozen O’Connor
3WTC, 175 Greenwich Street, 55th Floor
New York, New York 10007

SEYBERT, District Judge:

Heath Consultants Inc. (“Defendant” or “Heath”) moves,
pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure,
to dismiss the First Amended Complaint (the “FAC”) (ECF No. 27) of
Plaintiffs Plasky Company, Inc. (“Platsky”) and City Calibration
Centers Inc. (“City Calibration” and collectively with Platsky,
“Plaintiffs”) (hereafter, the “Dismissal Motion”). (See Dismissal
Motion, in toto, ECF No. 29.) For the reasons that follow,
Defendant’s Dismissal Motion is GRANTED IN PART AND DENIED IN PART.
BACKGROUND1
I. The Parties
City Calibration “is a New York limited liability
company having its principal place of business at 298 Montrose

Road, Westbury, New York 11590.” (FAC ¶ 17.)
Platsky, “is a New York corporation having its principal
place of business at 298 Montrose Road, Westbury, New York 11590.”
(Id. ¶ 18.) Platsky is the parent company of City Calibration.
(Id. ¶ 34.) Traditionally, Platsky was “a plumbing shelf goods
wholesale representative”; however, “over the years, it has
transitioned to an agency with a diverse product line, working
directly with wholesalers, contractors, architectural designers,
and engineers.” (Id.)
Heath “is a Texas corporation having its principal place
of business at 9030 Monroe Road, Texas 77061.” (Id. ¶ 19.) “Heath

has been doing business since 1933 and specializes in the
development of products and the provision of services for the
detection and prevention of gas leaks.” (Id. ¶ 22.) “These
products and services include the development and manufacturing of
gas detection devices and their related parts and accessories, as
well as the provision of gas leak investigation and inspection

1 The facts set forth herein are taken from the FAC and are accepted
as true for purposes of the instant Motion. See generally Lynch
v. City of N.Y., 952 F.3d 67, 75 (2d Cir. 2020).
services, underground utility damage prevention, and meter/reading
services.” (Id.) Relevant here, Heath also “develops and sells
products and services intended for use by” licensed master plumbers
(“LMPs”) “in the New York City Area.” (Id. ¶ 23.)
II. Local Law 152 and the LMP200

“In 2016, New York City enacted New York City Local Law
152” (“Local Law 152”). (Id. ¶ 24.) Local Law 152 “requires all
buildings in New York City (with some limited exceptions) to have
their gas piping systems inspected by a LMP at least once every
four years, beginning on January 1, 2020.” (Id.) Additionally,
Local Law 152 “requires LMPs to provide each building owner with
a Gas Piping System Periodic Inspection Report and certification.”
(Id. ¶ 25.) “Building owners are required to maintain all reports
and certifications for ten years.” (Id.) LMPs are not subject to
this record retention provision; however, Plaintiffs aver “it is

the best practice for LMPs to maintain their records for the same
period of time for liability purposes in the event something goes
wrong with the gas piping in a given building.” (Id.)
The LMP200 is the central product to Heath’s LMP
business. (Id. ¶ 26.) “The LMP200 is a gas detection tool
intended for use by the plumbing and HVAC communities in the New
York City Area to meet the requirements of Local Law 152.” (Id.)
The LMP200 was “developed collaboratively with Con-Edison,
National Grid and the LMPs and collected additional information
specific to the New York City metropolitan area.” (Id.) LMPs,
and their technicians, use the LMP200 “to conduct regulatory
compliant leak surveys of gas piping inside buildings.” (Id.
¶ 27.) “Heath advertises that the LMP200 can then transfer those

leak surveys, via Bluetooth, to applications running on smart
devices so that the LMP or Utility can visualize the data and then
store it in the cloud for regulatory reporting purposes down the
road.” (Id.) LMPs also use the LMP200 as part of their daily
duties, “including purging of interior piping and providing
atmosphere monitoring for both flammable gas and carbon monoxide.”
(Id. ¶ 28.)
“Heath also sells and distributes” a product known as an
ABC Station, together with the gasses2 required for the ABC
Station’s operation (collectively with the LMP200, the
“Products”). (Id. ¶ 29.) Every 30 days, “[t]he LMP200 requires

calibration on an ABC Station.” (Id.) Failure to do so will
result in the LMP200 becoming disabled. (Id.) “This is a safety
measure to ensure the LMPs are obtaining accurate results during
their gas inspections.” (Id.)
While Heath occasionally “distributes its products and
provides services directly to the consumer”, generally, “it enters
into distribution and/or service agreements with partners having

2 Herein, the Court adopts Plaintiffs’ use of the non-standard
plural form of “gas”.
knowledge and experience in the relevant marketplaces.”
(Id. ¶ 31.) Plaintiffs contend this was also the case with the
LMP200. (Id. ¶¶ 32-33.) Plaintiffs allege sometime “in or around
late 2018, Heath sought out Platsky, which had been recommended to

Heath by several industry insiders, to enter into a potential
supplier/distributor relationship.” (Id. ¶ 33.)
III. The Formation of City Calibration and the 2019 Agreement
A. City Calibration
“From the start of its negotiations with Heath, Platsky
principals knew they would need to create a new entity to enter
into any long-term distribution agreement with Heath” and “to run
the business associated with the distribution and service of
Heath’s LMP200 and its related accessories, including the ABC
Stations, and, eventually, conduct business related to the
technology it intended to create as part of the deal.” (Id. ¶ 37.)

To meet this need, on February 4, 2019, City Calibration was
formed. (Id. ¶ 38.)
B. The 2019 Agreement
On January 28, 2019, prior to City Calibration’s
formation, “Platsky and Heath negotiated and entered into an
exclusive distribution agreement by which Heath engaged Platsky,
‘as the sole distributer’” of the Products, “and associated
accessories for use with the New York City plumbing contractors.”
(Id. ¶ 39; see also 2019 Agreement, Ex. B, ECF No. 27-2, attached
to FAC.) Plaintiffs contend “[e]xclusivity was a material term of
the contract[]”, and, that absent exclusivity, “Platsky would not
have entered into the agreement.” (Id. ¶ 40.) Plaintiffs assert
“[t]he market for the Products was relatively small, such that a

non-exclusive distributorship would . . . not have been worth the
financial investment.” (Id.)
“Platsky and its affiliate, Platsky HVAC-R, were named
as parties to the 2019 Agreement”. (Id. ¶ 41.) While City
Calibration is not a named party to the 2019 Agreement, Platsky
alleges it “made clear to Heath at this time that it would be
forming a third entity through which the business of the 2019
Agreement would be conducted.” (Id.)
Plaintiffs assert that Heath notified them “in the 2019
Agreement that the LMP200 would cease to operate if it was not
timely calibrated”, but that Heath “knowingly omitted that the

LMP200 would also stop working if the data it collected was not
regularly cleared from the device and stored in the Cloud, which,
at the time of the execution of the 2019 Agreement, Heath had no
means to do.” (Id. ¶ 42.) Had Platsky known of these limitations
with the LMP200, Plaintiffs contend Platsky either (1) would “not
have entered into the 2019 Agreement”, or (2) “would have
negotiated different terms.” (Id. ¶ 53.)
While profit margins for sale of the LMP200 were narrow,
Plaintiffs aver “[t]he 2019 Agreement anticipated additional
profits for Platsky in the sale of the accessories, calibration
equipment, installations and replacement gasses themselves[.]”
(Id. ¶ 43.) The 2019 Agreement further “provided for the
opportunity for Platsky to provide the calibration as a service.”

(Id.) Since calibration of the LMP200 “needed to be done on a
monthly basis” this “would generate a stream of repeat business
for Platsky.” (Id.) As to calibration, “the 2019 Agreement
provided that Platsky would be responsible for the installation of
the ABC calibration station as well as maintaining the associated
calibration records for the contractor.” (Id. ¶ 44 (internal
quotation marks omitted).) “Platsky was to autonomously run this
portion of the business to”, inter alia, “help maintain consistency
in the market, [and] availability of information for contractors
who need access to calibration reports etc.” (Id. (internal
quotation marks omitted).)

“The term of the 2019 Agreement was through September
20, 2020” (id. ¶ 47) and was “binding upon and inure[d] to the
benefit of [Platsky] and its successors and assigns.” (Id. ¶ 46
(quoting 2019 Agreement § 12(b)).) Plaintiffs allege that “[t]he
2019 Agreement was to be for a limited time period [so as to]
allow[] Platsky to test the market before entering into a longer-
term distribution agreement and to develop the business that would
become City Calibration.” (Id. ¶ 50.) Plaintiffs contend “Heath
and Platsky agreed to evaluate the 2019 Agreement every six months
beginning October 1, 2019.” (Id. ¶ 47.) If Heath chose to
terminate the 2019 Agreement, “it was to be Heath’s sole
responsibility to buy back all approved and agreed upon [LMP200]
devices and ABC calibration stations from Platsky.” (Id.)

Paul D. Wehnert (“Wehnert”), Senior VP of Sales &
Marketing, executed the 2019 Agreement on behalf of Heath.
(Id. ¶ 48.) Jordan Stern (“Stern”), “then VP of Business
Development”, executed the 2019 Agreement on behalf of Platsky.
(Id. ¶ 49.) Plaintiffs allege, “[b]oth Platsky and Heath always
knew and planned for (1) the creation of City Calibration; and
(2) a new, long-term, exclusive distribution agreement.”
(Id. ¶ 51.) Plaintiffs aver:
[W]hen it entered into the 2019 Agreement,
Platsky relied upon Heath’s representations
that (1) Heath had the ability to grant
Plaintiffs an exclusive distributorship of all
of the Products described in the 2019
Agreement, and (2) the LMP200 could connect
via Bluetooth to a service provider’s personal
device to efficiently store and transfer the
data through software applications already
created by the local utility companies.

(Id. ¶ 52.) Plaintiffs assert, “[w]ithout these representations,
Platsky would not have entered into the 2019 Agreement.” (Id.)
Similarly, Plaintiffs aver Platsky would neither “have created
City Calibration nor invested large sums of money into the
development of its calibration business” without Heath’s
representations and omissions. (Id. ¶ 54.)
C. Operation of the Business Under the 2019 Agreement
1. The Calibration as a Service Business
“From January 2019 through March 2021, Heath and Platsky
engaged in the respective supply and distribution of the Products

as per the terms of the 2019 Agreement.” (Id. ¶ 56.) After
formation of City Calibration, “Heath and Platsky jointly drafted
and published a press release regarding the partnership created by
the 2019 Agreement, stating that ‘Platsky Company Inc. will
distribute Heath’s custom portable gas detectors to the
Metropolitan New York area through a newly formed company called
City Calibration Centers.’” (Id. ¶ 58.) “The press release
described City Calibration’s plan to open ‘strategically located
calibration stations at established plumbing supply wholesalers
throughout all five boroughs of New York City, Westchester, Long
Island, and northern New Jersey.’” (Id. ¶ 59.)

In accordance with the 2019 Agreement, “Platsky was
trained on the operation and functionality of the LMP200 and the
operation and installation of the ABC Stations.” (Id. ¶ 60.)
“Platsky then was responsible for the installation of the ABC
Stations as well as for maintaining the associated calibration
records for each contractor.” (Id.)
Since the LMP200 needed to be calibrated every 30 days,
and since this was an area of the business in which City
Calibration envisioned long-term profits, “with Heath’s knowledge,
City Calibration determined that it would not sell the ABC Stations
(which performed the Calibration) directly to the consumer, but,
instead, would create fractional franchises to perform the
calibration services at local wholesale retailers, readily

accessible to the LMPs.” (Id. ¶¶ 64-65.) The announcement of
City Calibration’s business model was part of the joint 2019 Press
Release. (Id. ¶ 65.) Additionally, as part of its calibration
service, “City Calibration also provided the service of extracting
and maintaining the calibration data for its customers.” (Id.
¶ 66.)
2. City Calibration’s Manual Extraction of the
LMP200’s Data

A third, unexpected, area of business arose as the
parties operated under the 2019 Agreement in that “Plaintiffs
quickly learned that the LMP200 device’s memory filled quickly and
needed to be cleared on a regular basis to maintain functionality.”
(Id. ¶ 67.) This created a “business around the collection and
maintenance of the LMP200’s inspection data.” (Id.)
Plaintiffs aver, prior to execution of the 2019
Agreement, Heath represented that the LMP200 device could connect
via Bluetooth “to various handheld devices through an existing
smart app” designed to manage the device’s data. (Id. ¶ 68.)
Specifically, Plaintiffs allege “Heath represented that software
was already in place” from Con-Edison and National Grid, “and that
those companies were either already or would soon be using their
own smart app to access the data from the LMP200 devices.” (Id.)
“Heath represented that this would enable City Calibration to
quickly and efficiently develop its own version of a smart app to

collect data from the LMP200 devices with Heath’s assistance.”
(Id.) Plaintiffs contend Heath’s representations were false.
(Id. ¶ 69.) Specifically, Plaintiffs allege “[n]ot only had the
Utility Companies not yet made available a fully function[al] smart
app,” but LMPs were hesitant to use any app that was developed
because: “(1) they would need to use different apps based on the
Utility company used by each building they inspected, and (2) the
LMPs did not want to share all of their data with the Utility
companies.” (Id.)
Plaintiffs allege Heath also “failed to inform
Plaintiffs that the LMP200s needed to have their data cleared on

a regular basis in order to maintain functionality, and that Heath
had, at the time, no technology in place to clear and store the
data in any manner.” (Id. ¶ 71.) Consequently, City Calibration
had to develop its own software and system “from scratch” “to
manage the data clearing and storage issues.” (Id. ¶ 72.)
Plaintiffs contend Heath was unable to assist City Calibration “in
developing the requisite software because it simply did not have
the experience it claimed it did with transferring the LMP200
data.” (Id. ¶ 73.) In developing its own smart app without
Heath’s assistance, Plaintiffs “expended extensive time and
resources.” (Id. ¶ 74.) Moreover, prior to development of the
smart app, City Calibration “also had to create and utilize a
computer-based software that required a hard-wired computer to

extrapolate the data from the LMP200, convert it to a pdf from a
raw data file, and send it to City Calibration’s cloud and then on
to the customer.” (Id.) This manual extraction was a “tedious
process” and “required the hiring of additional staff and the
purchase of additional vehicles and equipment.” (Id. ¶ 75.)
Plaintiffs maintain that development of the manual data extraction
process, together with its implementation, was not the deal they
had intended to make with Heath since it “was far more expensive
for City Calibration” than anticipated. (Id. ¶ 77.) This added
expense, Plaintiffs allege, flowed directly from Heath’s alleged
misrepresentation of the device’s capabilities. (Id.)
3. City Calibration’s Development of a Smart App

The development of a smart app created the possibility
for a fourth area of business for City Calibration. (Id. ¶ 78.)
Development of the smart app would enable “customer[s] to connect
the LMP200 device to their phone or other personal device
to (1) extract the tool data . . . resolving the data storage
issues and eliminate the need for manual extraction; and
(2) maintain readily accessible records in the Cloud for each of
the customer’s jobs.” (Id.) Plaintiffs assert “Heath was
supportive of Plaintiffs’ pursuit of a new, better functioning
smart app.” (Id. ¶ 79.) To that end, “Heath connected
Plaintiff[s] directly with Heath’s manufacturer, GMI, to obtain
the necessary technical information required for City Calibration

to develop its proposed technology.” (Id.)
“GMI is one of the world’s largest manufacturers of gas
and flame detection products and is located in the United Kingdom.”
(Id. ¶ 80.) “Heath is GMI’s primary distributor in the United
States.” (Id.) Since “neither City Calibration nor Platsky had
a direct relationship with GMI”, Heath’s Vice President of Sales,
Gerald Sims (“Sims”)3, “facilitated the negotiation of a non-
disclosure agreement between City Calibration and Heath.” (Id.
¶ 81.) The GMI non-disclosure agreement (the “GMI NDA”) “was
intended to protect both the technical information provided by GMI
to City Calibration, and the intellectual property developed by

City Calibration.” (Id. ¶ 83.)
IV. The Expiration of the 2019 Agreement and the Alleged 2021
Agreement

Plaintiffs allege that while sales in the first year and
a half “were slow”, by the “summer of 2020, sales began to
accelerate, and the Parties determined to continue their exclusive
distributor relationship.” (Id. ¶¶ 84-85.) Consequently, “prior

3 Gerald Sims took over this role from Wehnert. (See FAC ¶ 81.)
to the September 30, 2020 termination date of the 2019 Agreement,”
Plaintiffs allege “Heath and Plaintiffs engaged in active
negotiation[s] [for] the renewal of the 2019 Agreement or the
creation of a new contract.” (Id. ¶ 86.) Plaintiffs assert

“[n]either Sims nor any other representative of Heath ever told
Plaintiffs that Heath intended to allow the agreement to lapse nor
that it had otherwise ended Platsky’s role as a distributor for
Heath.” (Id. ¶ 87.) On the contrary, Plaintiffs allege “[o]n
behalf of Heath, Sims represented on multiple occasions
to . . . Stern . . . that Heath was renewing the agreement.”
(Id. ¶ 88.)
“[O]n July 23, 2020, Sims wrote in an email to Heath’s
‘Manager of Legal,’ Victoria Quinones” (“Quinones”), copying Stern
and Eric Six (“Six”), Heath’s New York sales consultant, “that
‘Platsky is our sole distributor of the . . . LMP200. We have a

current agreement with him. We need to renew this agreement[,] so
I’ve asked [Stern] to red line the current document with changes
he is requesting and email it to you and I [sic] for review.”
(Id. ¶ 89.) Plaintiffs allege “Sims directed Stern to speak
directly with Quinones,” and, further, that “Stern was led to
believe [Quinones] was Heath’s general counsel and was an attorney
with the authority to negotiate contracts on behalf of Heath.”
(Id. ¶ 90; see also id. ¶ 91.)
From July 2020 until March 2021, when Quinones sent Stern
what Plaintiffs allege was the final Agreement, Plaintiffs contend
“Heath and Stern were actively engaged in negotiations regarding
new terms for the Agreement.” (Id. ¶ 92.) “These new terms were

expressly intended to protect the App and other intellectual
property City Calibration was developing and to provide a mechanism
for use of that App on a nationwide scale.” (Id.)
Plaintiffs highlight, “Sims was always involved in the
review of the drafts and was copied on a significant portion of
the correspondence regarding the negotiations.” (Id. ¶ 93.)
Plaintiffs aver “Sims continually directed Stern to Quinones for
redlining or otherwise providing changes to the draft agreements”,
including on August 10, 2020, when Sims inquired whether Stern had
had “a chance to send [Quinones] [his] redlines for contract
changes[.]” (Id.) Plaintiffs estimate “negotiation of the new

Agreement took . . . slightly more than five months [] because the
Agreement covered additional terms and Plaintiffs had to work with
their attorneys to ensure that their intellectual property rights
were protected.” (Id. ¶ 94.) Plaintiffs contend “City
Calibration’s intent to develop the App was therefore necessarily
a large part of the[] discussions.” (Id. ¶ 95.) During the
negotiations, Plaintiffs assert “both Heath and Plaintiffs
continued to operate under the terms of the 2019 Agreement.”
(Id. ¶ 96.)
“On March 2, 2021, at the direction of Sims, Quinones
contacted Stern stating that she had ‘received the redlines from’”
Sims, “and requested a call to discuss the [redlines] with Stern.”
(Id. ¶ 97.) On March 3, 2021, Plaintiffs allege that “Quinones

and Stern negotiated the finalization of the Agreement over the
Phone.” (Id. ¶ 98.) As part of their discussion,
“Stern and Quinones exchanged different versions of the Agreement
for discussion purposes.” (Id.) Plaintiffs contend “[b]y the end
of the call, the Parties agreed upon a version of the Agreement
that built upon Heath’s standard agreement, but contained certain
additional terms required by City Calibration.” (Id. ¶ 99.)
On March 4, 2021, “Quinones emailed Stern, writing ‘I
have reviewed the changes, and the proposed insertions are
acceptable. Please sign and return at your earliest convenience.’”
(Id. ¶ 100.) “Sims was copied on the email” and Plaintiffs aver

Sims “had already approved the terms of the agreement.” (Id.
¶ 101.) On March 9, 2021, at Quinones’ direction, Stern signed
the Agreement “on behalf of City Calibration and Platsky . . . and
returned it to Heath, believing that Heath had already accepted
the terms.” (Id. ¶ 102.) “Plaintiffs never received a
countersigned version of the Agreement.” (Id. ¶ 103.) Rather,
“Plaintiffs believed—and acted in accordance with [this] belief—
that Sims had in fact signed the agreement on behalf of Heath.”
(Id.) Moreover, Plaintiffs allege Sims confirmed their belief
when, days later, Sims called Stern, “to congratulate him on
getting the deal done.” (Id.) Specifically, Plaintiffs aver Sims
called Stern and told him, “I told you I’d get the deal done for
you. Congratulations. When am I going to see you again?”

(Id. ¶ 104.) In addition to Sims’ congratulatory statement,
Plaintiffs emphasize that “Heath’s execution of the Agreement was
further confirmed by its performance under its terms for well over
one year.” (Id. ¶ 105.)
A. The Terms of the 2021 Agreement

Plaintiffs contend, after Stern had signed and returned
the 2021 Agreement to Quinones, “Heath operated under the terms of
the new Agreement.” (Id. ¶ 106.) Plaintiffs highlight, “Heath
confirmed the existence of the Agreement by supplying City
Calibration with the Products, and City Calibration, through its
affiliate Platsky, made payments to Heath for the Products, as per
the terms of the Agreement.” (Id.) Plaintiffs contend “[t]his
was in accordance with the practices established by the Parties
under the 2019 Agreement—to which Platsky HVAC-R was a party,
despite not being the entity billed—and continued during the
negotiation period.” (Id. ¶ 107.)
Under the 2021 Agreement, “Heath appointed City
Calibration as the exclusive distributor of the LMP200, the ABC
Station, and the calibration gasses and associated accessories
within North America.” (Id. ¶ 108.) “In return, City Calibration
agreed to purchase the Products from Heath under the terms and
conditions of the Agreement.” (Id.) Plaintiffs aver that, like
the 2019 Agreement, “[e]xclusivity was an essential term of the
[2021] Agreement for City Calibration and its principals.” (Id.

¶ 109.) “The Agreement is governed by the laws of the State of
New York and provides for arbitration in accordance with the
Commercial Arbitration Rules of the American Arbitration
Association.” (Id. ¶ 121.)
As to the App, “[a]ll customer data was to be owned
solely by City Calibration.” (Id. ¶ 110.) Further, “Heath was
restricted from permitting any third person ‘to develop Software
that is compatible with (or connects to) any Product, including
any Software that transmits or processes any Customer Data to or
from the Product, unless that third person was a utility company,
as defined in the Agreement.’” (Id. ¶ 111 (quoting 2021 Agreement,

Ex. A, ECF No. 27-1, attached to FAC.)) The Agreement described
City Calibration’s App as “Software developed by [City
Calibration] for the purpose[] of integrating Teledyne’s PS200-
LMP portable gas detection instrumentation to an application being
developed by the Company on a handheld mobile device via a
Bluetooth wireless interface.” (Id. ¶ 123.) Based upon the
protections in the 2021 Agreement, City Calibration began working
“with software engineers to develop the App, expending extensive
resources to do so.” (Id. ¶ 125.)
“The term of the Agreement was seven years, followed by
automatic renewal for additional successive periods of two years
each.” (Id. ¶ 114.) “After the initial seven-year term either
Party could decide not to renew the Agreement by providing written

notice either thirty or sixty days prior to the end of the current
term (depending on timing).” (Id.) “Either Party could also
terminate the Agreement upon the breach of the Agreement by the
other Party with ten days written notice.” (Id. ¶ 115.) In such
instances, “[t]he breaching party was given an opportunity to cure
any breach.” (Id.)
Article IV of the 2021 Agreement allegedly contained the
“Price, Payment and Deliver[y] Terms” and states, in pertinent
part:
Distributor shall purchase the Products for
its own account from Heath. Initial prices
for the Products are listed in Exhibit A.
Prices may be changed at any time by
Distributor on ninety (90) days’ prior written
notice to Distributor, provided that prices
shall not increase in any calendar year
occurring during the Term more than five
percent (5%) above the price that was in
effect during the immediately preceding
calendar year occurring during the Term.
Exhibit A may be revised as necessary to
reflect the implementation of mutually agreed
upon price changes.

(Id. ¶ 116 (quoting 2021 Agreement § 4.2).) Plaintiffs contend
“[t]he actual dollar value of the sales price to be included as
Exhibit A was not material to the contract” because “Heath decided
upon the price of the Products based upon the volume and timing of
the order and included that price within the invoices it sent to
Platsky.” (Id. ¶ 117.) Plaintiffs estimate that “price always
remained around $1000, fluctuating by approximately one to two

hundred dollars on any given order.” (Id.) Plaintiffs state
“[t]his remained the practice of the parties . . . throughout
their relationship” and, moreover, that this “was consistent with
industry standards.” (Id. ¶ 118.)
Regarding insurance terms, the 2021 Agreement stated
that “Distributor . . . agreed to maintain such insurance
acceptable to Heath as set for[th] on Exhibit D, Insurance
Requirements.” (Id. ¶ 119.) Plaintiffs aver, “[a]s City
Calibration already maintained insurance acceptable to Heath and
had already been provided with Heath’s insurance requirements,
Exhibit D was”, “also not material to the Agreement.” (Id. ¶ 120.)
B. The Parties’ Performance Under the 2021 Agreement

During the time under which the Parties allegedly
operated under the 2021 Agreement, City Calibration “believed it
was the sole distributor of the ABC Stations and related [gasses]
and accessories in the New York City Metropolitan Area.”
(Id. ¶ 127.) Additionally, “Heath worked directly with Plaintiffs
to sell, market, and service the Products.” (Id. ¶ 128.) For
example, Six “appeared in a video posted on City Calibration’s
website describing to LMPs how to use the LMP200 and referring the
LMPs directly to Heath’s ‘partner City Calibration.’” (Id.) “Six
closes the video by referring the viewer to City Calibration’s
local calibration centers to conduct the required 30-day
calibrations and tells the viewer to contact City Calibration for

technical support and questions.” (Id. ¶ 129.) “At the time,
Sims was Six’s direct manager.” (Id.)
Following execution of the 2021 Agreement, “Heath
continued to invoice Platsky and ship Products to either Platsky,
or, on at least one occasion, to City Calibration.” (Id. ¶ 131.)
Likewise, “Platsky continued to pay each invoice, as was the
Parties’ practice from the onset of their relationship in 2019.”
(Id.) “Further, Heath continued to charge Plaintiffs at a similar
rate as it did under the 2019 contract.” (Id. ¶ 132.) Plaintiffs
aver this “price fluctuated between approximately $900 and $1200
depending on the volume and timing of the order.” (Id.)

In accordance with Section 5.1 of the 2021 Agreement,
Plaintiffs allege that “Heath also issued Plaintiffs credits and
replacement devices as a result of malfunctioning devices.”
(Id. ¶ 133.)
C. Heath’s Alleged Breach of the 2021 Agreement

In Summer 2022, Heath ceased communications with
Plaintiffs. (Id. ¶ 134.) In approximately July 2022, “Plaintiffs
discovered that Heath was taking steps to advertise and sell the
Products covered by the Agreement directly to consumers in the New
York City Metropolitan Area market.” (Id. ¶ 134-35.) Plaintiffs
discovered Heath’s entrance into the New York City Metropolitan
Area market “when one of City Calibration’s customers sent it a
Heath advertisement it had received through the local plumbers’

union.” (Id. ¶ 138.) “In [the] advertisement, Heath stated that
[it] was ‘pleased to announce that [Heath] will be taking over
direct sales and support of the LMP 200 device designed by the
plumbing community for their use to meet NYC Local Law 152.’”
(Id. (emphasis in original).) As part of its entry into the
market, Heath “also offered its own ‘on-site’ calibration
services.” (Id.)
“[A]s Heath began to move into the market as a
distributor as well as the supplier, Heath [also] began to move
into the calibration business, taking City Calibration’s customers
for itself.” (Id. ¶ 139.) Plaintiffs allege “Heath admits it has

sold multiple ABC stations directly to consumers in” City
Calibration’s market, and, that, since a single ABC station can
service many LMPs, “the sale of only a small number of ABC stations
negatively impacts City Calibration’s calibration business
significantly.” (Id.)
When Stern learned of Heath’s attempted entry into the
New York City Metropolitan Area market, he contacted Sims “to
notify Heath of the suspected breach of the Agreement and to
attempt to resolve the issue.” (Id. ¶ 140.) Sims denied the
existence of the 2021 Agreement. (Id.) On September 21, 2022,
Heath, through legal counsel, sent Plaintiffs “a letter further
denying the existence of the Agreement and directing Plaintiffs to
cease communication with Heath regarding the issue.” (Id. ¶ 141.)

In October, Plaintiffs contend they began to receive
inquiries from customers that “were confused as to who they were
supposed to contact regarding the sale and repair of the Products
and for the provision of the related calibration services.”
(Id. ¶ 142.) Plaintiffs aver “City Calibration is . . . being
closed out of the business they had contracted for and has lost
and continues to lose its customer goodwill, relationships and
sales revenues.” (Id. ¶ 143.)
In or around December 6, 2022, “Heath announced that it
was developing and intended to bring to market its own App that
will directly compete with and replace the App developed by

Plaintiffs.” (Id. ¶ 145.) “Shortly thereafter, Neil Aranoff, a
representative of Plaintiffs,” contacted Six “to inquire about the
fulfillment of an outstanding order of Products” but was informed
by Six that he “was no longer handling Plaintiffs’ account and
that Heath would not be fulfilling Plaintiffs’ outstanding order
or otherwise providing Products to Plaintiffs.” (Id. ¶ 146.) “On
or around February 1, 2023, City Calibration discovered that Heath
had posted a link to free software that allows for the clearing of
data from the LMP200 devices on its website.” (Id. ¶ 147.)
Plaintiffs aver “[t]his further undermines a substantial portion
of City Calibration’s calibration services business[.]” (Id.)
Plaintiffs highlight that Nassau and Suffolk Counties
“have both announced that they are enacting or have already enacted

laws similar to Local Law 152, such that an enormous market in the
New York City Metropolitan Area is about to open for the
distribution and servicing of the Products.” (Id. ¶ 155.)
Plaintiffs speculate that “Heath knew that this expansion was
imminent—and therefore, that the potential for making profits off
of the sale and servicing of the Products was to soon be
multiplied—” when it allegedly breached the 2021 Agreement.
(Id. ¶ 159.)
PROCEDURAL HISTORY
On December 21, 2022, Plaintiffs commenced this case by
way of Complaint, initially filing the Complaint with the Supreme

Court of the State of New York, Nassau County (the “State Court”).
(See Verified Complaint, Ex. A-1, ECF No. 1-1, attached to Notice
of Removal.) On December 23, 2022, Heath removed the case to this
Court. (See Notice of Removal, ECF No. 1.) Prior to removal, on
December 23, 2022, the State Court issued an Order to Show Cause
as to why Plaintiffs should not be granted a Preliminary Injunction
enjoining Defendant from , inter alia, “selling, purchasing,
renting, reselling or otherwise distributing” the Products “within
the North American Territory, as defined in the [Parties’]
Agreement” or “developing and/or distributing software, . . . that
is compatible with or connects to the LMP200 gas detector or the
ABC station.” (Order to Show Cause, Ex. 1, ECF No. 5-1, attached
to Motion for TRO.) On January 11, 2023, in this action,

Plaintiffs filed a motion seeking an order (1) enforcing the Order
to Show Cause entered by the State Court; and (2) extending the
return date of the TRO until a date upon which the Parties could
be heard (hereafter the “TRO Motion”). (See Motion for TRO, ECF
No. 5.)
On January 12, 2023, this case was reassigned to the
undersigned. (See Jan. 12, 2023 Elec. Order Reassigning Case.)
On January 17, 2023, Defendant opposed Plaintiffs’ TRO Motion.
(See Opp’n to TRO, ECF No. 6.) On January 18, 2023, the Court
denied Plaintiffs’ TRO Motion finding the State Court TRO had
expired prior to Plaintiffs’ TRO Motion in the Court, rendering

Plaintiffs’ request moot. (See Jan. 18, 2023 Elec. Order Denying
TRO Motion.)
On January 30, 2023, in accordance with a briefing
schedule set by the Court, Plaintiffs filed a Motion for a
Preliminary Injunction (hereafter the “PI Motion”). (See PI
Motion, ECF No. 13.) On March 13, 2023, Defendant opposed
Plaintiffs’ PI Motion. (See Opp’n to PI Motion.) In the interim,
the parties engaged in mediation which returned unsettled. (See
Mar. 7, 2023 Elec. Report of Mediation Unsettled.) A hearing on
Plaintiffs’ PI Motion was held on March 24, 2023 with the only
witness to testify being Stern. (See Min. Order for Proceedings,
ECF No. 24.) Ultimately, the Court denied Plaintiffs’ PI Motion
finding, inter alia, Plaintiffs had not demonstrated irreparable

harm, or harm that could not be appropriately compensated for with
an award of monetary damages. (See Min. Order for Proceedings,
ECF No. 25.) Upon the denial of Plaintiffs’ PI Motion, the Court
set a briefing schedule on Defendant’s anticipated Dismissal
Motion.
On April 17, 2023, Defendant filed its initial dismissal
motion in this case. (See ECF No. 26.) In response, Plaintiffs
filed the FAC. The FAC pleads five causes of action:
(1) Breach of Contract as to the 2021 Agreement (Count One)
(FAC ¶¶ 160-64);
(2) Promissory Estoppel (Count Two) (id. ¶¶ 165-70);
(3) Common Law Unfair Competition (Count Three) (id.

¶¶ 171-78);
(4) Fraudulent Inducement as to the 2019 Agreement (Count Four)
(id. ¶¶ 179-88); and
(5) Tortious Interference with respective Economic Advantage
(Count Five) (id. ¶¶ 189-202.)
In response, Defendant filed the present Dismissal
Motion on May 26, 2023. (See generally Dismissal Motion; see also
Support Memo, ECF No. 31.) Plaintiffs filed their Opposition on
June 15, 2023 (Opp’n, ECF No. 32), to which Defendant replied on
June 29, 2023. (Reply, ECF No. 33.)

DISCUSSION
I. Legal Standard

When considering a motion to dismiss under Rule
12(b)(6), the court must “accept as true all factual statements
alleged in the complaint and draw all reasonable inferences in
favor of the non-moving party.” McCarthy v. Dun & Bradstreet
Corp., 482 F.3d 184, 191 (2d Cir. 2007). To survive a motion to
dismiss under Rule 12(b)(6), a complaint must state “enough facts
to state a claim to relief that is plausible on its face.” Bell
Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).
A claim is plausible “when the plaintiff pleads factual
content that allows the court to draw the reasonable inference

that the defendant is liable for the misconduct alleged.” Ashcroft
v. Iqbal, 556 U.S. 662, 678 (2009). Consequently, a complaint is
properly dismissed where, as a matter of law, “the allegations in
a complaint, however true, could not raise a claim of entitlement
to relief.” Twombly, 550 U.S. at 558. Similarly, a complaint is
also properly dismissed “where the well-pleaded facts do not permit
the court to infer more than the mere possibility of misconduct.”
Iqbal, 556 U.S. at 679. “Although all allegations contained in
the complaint are presumed true” at the motion to dismiss stage,
“this principle is ‘inapplicable to legal conclusions’ or
‘[t]hreadbare recitals of the elements of a cause of action,
supported by mere conclusory statements.’” Szewczyk v. City of
N.Y., No. 15-CV-0918, 2016 WL 3920216, at *2 (E.D.N.Y. July 14,

2016) (alteration in original) (quoting Iqbal, 556 U.S. at 678).
II. Analysis
A. Documents the Court will Consider in Deciding
Defendant’s Dismissal Motion

As an initial matter, the Court must determine which
documents, extraneous to the FAC, it may consider in deciding
Defendant’s Dismissal Motion.
“If, on a motion under Rule 12(b)(6) . . . matters
outside the pleadings are presented to and not excluded by the
court, the motion must be treated as one for summary judgment under
Rule 56 [and] [a]ll parties must be given a reasonable opportunity
to present all the material that is pertinent to the motion.” FED.
R. CIV. P. 12(d). “For purposes of this rule, ‘the complaint is
deemed to include any written instrument attached to it as an
exhibit or any statements or documents incorporated in it by
reference.’” Chambers v. Time Warner, Inc., 282 F.3d 147, 152 (2d
Cir. 2002) (quoting Int’l Audiotext Network, Inc. v. Am. Tel. &
Tel. Co., 62 F.3d 69, 72 (2d Cir. 1995)). When a “document is not
incorporated by reference, the court may nevertheless consider it
where the complaint ‘relies heavily upon its terms and effect,’
which renders the document ‘integral’ to the complaint.” Id. at
153 (quoting Int’l Audiotext, 62 F.3d at 72). “However, ‘even if
a document is “integral” to the complaint, it must be clear on the
record that no dispute exists regarding the authenticity or

accuracy of the document.’” DiFolco v. MSNBC Cable L.L.C., 622
F.3d 104, 111 (2d Cir. 2010) (quoting Faulkner v. Beer, 463 F.3d
130, 134 (2d Cir. 2006)).
“Whether a document is attached to a complaint is [self-
evident].” DeLuca v. AccessIT Grp., Inc., 695 F. Supp. 2d 54, 60
(S.D.N.Y. 2010) (citing Cortec Indus., Inc. v. Sum Holding L.P.,
949 F.2d 42, 47 (2d Cir. 1991) (stating any written instrument
attached as an exhibit to a complaint is deemed part of the
pleadings)). “To be incorporated by reference, the complaint must
make ‘a clear, definite and substantial reference to the
documents.’” Id. (quoting Helprin v. Harcourt, Inc., 227 F. Supp.

2d 327, 330-31 (S.D.N.Y. 2003)). However, “[l]imited quotation
does not constitute incorporation by reference.” McLennon v. City
of N.Y., 171 F. Supp. 3d 69, 88-89 (E.D.N.Y. 2016) (quoting Looney
v. Black, 702 F.3d 701, 716 n.2 (2d Cir. 2012)). Rather, to be
integral to the complaint, a plaintiff must have: (1) “actual
notice” of the extrinsic information; and (2) have “relied upon
[the] documents in framing the complaint.” Chambers, 282 F.3d at
153 (quoting Cortec Indus., 949 F.2d at 48). Indeed, “a
plaintiff’s reliance on the terms and effect of a document in
drafting the complaint is a necessary prerequisite to the court’s
consideration of the document on a dismissal motion.” Id. (quoting
Cortec, 949 F.2d at 47-48 (emphasis in original)).
Applying the aforementioned standard, in connection with

the Dismissal Motion the Court finds it may consider the 2019
Agreement, and the 2021 Agreement, both of which are attached to
the FAC. Furthermore, the Complaint incorporates by reference the
March 4, 2021 email from Quinones to Stern in which Quinones
allegedly accepted the terms of the 2021 Agreement on behalf of
Heath (hereafter the “Quinones Email”). (See Quinones Email, Ex.
D, ECF No. 30-4, attached to Deutsch Decl.) Given the FAC’s
reliance upon the Quinones Email in framing Count One of the FAC,
together with the fact Plaintiffs clearly had notice of its
contents due to their quotation of same, the Court will also
consider said Email in connection with the Dismissal Motion.4

Defendant contends this Court may also consider Stern’s
testimony given during the Parties’ contested preliminary
injunction hearing, without converting the Dismissal Motion into
one for summary judgment (see Support Memo, in toto (citing Stern’s
Hr’g Testimony in passim)), the Court declines to do so.5 See

4 Plaintiffs, likewise, do not dispute the authenticity of the
Quinones Email. (See Opp’n at 1 n.2.)

5 Likewise, the Court declines to consider the remainder of the
evidence submitted as part of the parties’ preliminary injunction
Carter v. Fagin, 363 F. Supp. 2d 661, 664 n.1 (S.D.N.Y. 2005)
(declining to consider witness testimony presented as part of a
preliminary injunction hearing on a motion to dismiss); but see
Signorelli v. N.Y.S. Bd. of Elections, No. 95-CV-1026, 1995 WL

548712, at *5 (N.D.N.Y. Sept. 11, 1995) (converting defendants’
motions to dismiss into motions for summary judgment where “[b]oth
plaintiffs and defendants submitted affidavits and offered
testimony at [a] preliminary injunction hearing” and the court
opted to consider this evidence in resolving the motions); Calo v.
Paine, 385 F. Supp. 1198, 1200 (S.D.N.Y. 1974) (finding where
“testimony was presented at the hearing on plaintiff’s motion for
a preliminary injunction and other materials, including affidavits
of the defendants, were submitted by the defendants and not
objected to by the plaintiff, the motion [would] be treated as one
for summary judgment.”), vacated and remanded on other grounds,

521 F.2d 411 (2d Cir. 1975).
B. Breach of the 2021 Agreement (Count One)
“To prevail on a breach-of-contract claim in New York,
a plaintiff must prove: ‘(1) the existence of a contract,
(2) performance by the party seeking recovery, (3) nonperformance
by the other party, and (4) damages attributable to the breach.’”
Moreno-Godoy v. Kartagener, 7 F.4th 78, 85 (2d Cir. 2021) (quoting

hearing since, to do so, the Court would be required to convert
the present motion into a motion for summary judgment.
RCN Telecom Servs., Inc. v. 202 Ctr. St. Realty LLC., 156 F. App’x
349, 350-51 (2d Cir. 2005)); see also Empire Fire and Marine Ins.
Co. v. Edge Auto, Inc., No. 21-CV-5413, 2022 WL 17779117, at *4
(E.D.N.Y. Sept. 15, 2022) (same). A valid contract requires “a

manifestation of mutual assent sufficiently definite to assure
that the parties are truly in agreement with respect to all
material terms.” Cohen v. Avanade, Inc., 874 F. Supp. 2d 315, 320
(S.D.N.Y. 2012) (quoting Express Indus. and Terminal Corp. v. N.Y.S
Dep’t of Transp., 93 N.Y.2d 584, 589 (1999)).
Defendant argues the 2021 Agreement is not an
enforceable contract; Defendant’s argument in this regard is
threefold. First, Defendant contends the 2021 Agreement was not
signed by Heath, the party against whom enforcement is sought,
thus, the Agreement violates the Statute of Frauds contained in
New York’s Uniform Commercial Code (the “UCC”). Next, Defendant

argues since the 2021 Agreement is for a term lasting longer than
one year, it is violative of the Statute of Frauds contained in
the General Obligations Law (the “GOL”). (See Support Memo at 5.)
Finally, Defendant avers even if the unsigned 2021 Agreement were
not violative of the Statute of Frauds, it would still not be an
enforceable contract as it lacks material terms. (Id. at 9.) The
Court addresses each argument in turn.
1. The 2021 Agreement is a Contract for the Sale of
Goods; therefore, the U.C.C. Applies to its Terms6

As an initial matter, both parties agree the UCC applies
to the 2021 Agreement since, if it is a contract at all, it is a
contract that is predominantly for the sale of goods for more than
$500.7 (See Support Memo at 4 n.2 (“The U.C.C. is applicable
here”); see also Opp’n at 6 n.4.) See E. Mishan & Sons, Inc. v.
Homeland Housewares, LLC, No. 10-CV-4931, 2012 WL 2952901, at *4
(S.D.N.Y. July 16, 2012) (“Even where the contract at issue is a
distributorship agreement, it is governed by the UCC if it is
predominantly for the sale of goods.”) (citing Marbelite Co. v.
Nat’l Sign and Signal Co., 2 F. App’x 118, 120 (2d Cir. 2001));
see also Alessi Equip., Inc. v. Am. Piledriving Equip., Inc., 578
F. Supp. 3d 467 (S.D.N.Y. 2022) (“[N]umerous courts within this
Circuit have determined that ‘exclusive dealership or

6 To the extent Defendant argues the 2021 Agreement is also for a
term lasting longer than one year and, consequently, is also
violative of GOL Section 5-701, the Court agrees with Plaintiffs
that the FAC adequately pleads facts plausibly alleging that Heath
may have signed the Agreement and, likewise, it is reasonable to
infer Heath has said Agreement in its possession. (See FAC ¶¶
100-05.) Additionally, as discussed infra, the FAC plausibly
alleges that the Quinones Email is a signed writing that is
sufficient to satisfy the Statute of Frauds. Therefore, the Court
declines to dismiss Plaintiffs’ breach of contract claim on this
basis. This does not preclude Defendant from arguing why the GOL
should apply to Plaintiffs’ claims at a subsequent stage of this
litigation.

7 The FAC pleads facts which, accepted as true, establish that the
2021 Agreement contemplated the sale of goods worth more than $500.
(See e.g., ¶¶ 116-18, 131-32.)
distributorship arrangements’ involving the sale of complex
equipment in specific geographic territories . . . are
‘predominantly for the sale of goods’ and thus, subject to the
U.C.C.”) (collecting Cases)). Consequently, the Court applies the

UCC to the parties’ claims. See ABA Refinery Corp. v. Republic
Metals Refin. Corp., No. 15-CV-8731, 2017 WL 4481170, at *4 n.3
(S.D.N.Y. Oct. 5, 2017) (Applying the UCC to the parties’ claims
where their briefs cited to the UCC as the controlling body of law
and noting that “the Second Circuit has explained, where ‘[t]he
parties’ briefs assume’ that a certain body of law controls, ‘such
implied consent is sufficient to establish choice of law.’”
(quoting Krumme v. WestPoint Stevens Inc., 238 F.3d 133, 138 (2d
Cir. 2000))).
2. Application of the Statute of Frauds

The UCC Statute of Frauds is contained in Section
2-201(1) of the N.Y. UCC and states:
Except as otherwise provided in this
section[,] a contract for the sale of goods
for the price of $500 or more is not
enforceable by way of action or defense unless
there is some writing sufficient to indicate
that a contract for sale has been made between
the parties and signed by the party against
whom enforcement is sought or by his
authorized agent or broker.

“This provision ‘simply requir[es] “that the writing afford a basis
for believing that the offered oral evidence rests on a real
transaction.”’” Rienzi & Sons, Inc. v. I Buonatavola Sini S.R.L.,
No. 20-CV-5704, 2021 WL 5013795, at *3 (E.D.N.Y. Oct. 28, 2021)
(quoting Bazak Int’l Corp. v. Mast. Indus., Inc., 73 N.Y.2d 113,
120 (1989)).
i. The Confirmatory Writings Exception to the
Statute of Frauds

The UCC Statute of Frauds contains certain exceptions by
which an unsigned contract may, nevertheless, be enforceable.
First, the Merchant’s Exception contained in Section 2-201(2).
The Merchant’s Exception provides:
Between merchants if within a reasonable time
a writing in confirmation of the contract and
sufficient against the sender is received and
the party receiving it has reason to know its
contents, it satisfies the requirements of
subsection (1) against such party unless
written notice of objection to its contents is
given within 10 days after it is received.

“There are no rigid requirements as to the form or content of a
confirmatory writing.” Antifun Ltd. T/A Premium Vape v. Wayne
Indus. LLC, 616 F. Supp. 3d 291, 307-08 (S.D.N.Y. July 22, 2022)
(quoting Hilord Chem. Corp. v. Ricoh Elecs., Inc., 875 F.2d 32, 37
(2d Cir. 1989)). Indeed, “[a] writing is sufficient so long as it
affords a basis for believing that it reflects a real transaction
between the parties.” Id.
Plaintiffs contend the Merchant’s Exception applies in
this case (opp’n at 2-3), specifically, that their “return to Heath
of the signed Agreement, and the March 4, 2021 emails, sent by”
Quinones “constitute Heath’s confirmation of the terms of the
Agreement, thereby creating an enforceable agreement between the
parties.” (Id. at 3.) Defendant refutes Plaintiffs’ contentions
and argues Plaintiffs have failed to “plausibly allege that the
2021 Draft” was signed by Heath as required by N.Y. UCC

Section 2-201(1). (Support Memo at 4.)
Courts in this circuit have found that “[e]lectronic
communications between merchants—provided that they are
sufficiently precise—can . . . serve as writings confirming an
agreement.” Antifun Ltd. T/A Premium Vape, 616 F. Supp. 3d at 308
(citing E. Mishan & Sons, Inc., 2012 WL 2952901, at *5); see also
Bazak Intern. Corp., 378 F. Supp. 2d at 383-86; Henry Avocado Corp.
v. Z.J.D. Brother, LLC, No. 17-CV-4559, 2019 WL 1586865, at *11
n.10 (E.D.N.Y. Apr. 12, 2019) (noting an email containing an
“electronic signature[] . . . satisf[ies] the merchant’s
exception to the statute of frauds”).

Here, on March 3, 2021, Stern emailed Quinones a copy of
the 2021 Agreement. On March 4, 2021, Quinones replied “it was a
pleasure talking to you yesterday. I have reviewed the changes,
and the proposed insertions are acceptable. Please sign and return
at your earliest convenience.” (Quinones Email (emphasis added).)
The Quinones Email contains an electronic signature block stating
her name, title, and contact information. (Id.) The Court finds
that, considering the above-mentioned case law, Quinones’
electronic signature suffices to qualify as a signed writing as it
is arguably a manifestation of Quinones’ intent to authenticate
the email transmission. Cf. Kokirtsev v. Wells Fargo Nat’l Ass’n,
No. 12-CV-6056, 2014 WL 3888301, at *3 n.2 (E.D.N.Y. Feb. 3, 2014)
(stating, under the GOL “[a] name or other symbol attached to a

piece of paper with an intent to authenticate it creates a valid
signature”, and that “[t]he use of an electronic signature shall
have the same validity and effect as the use of a signature affixed
by hand.”); see also In re 4Kids Ent., Inc., 463 B.R. 610, 693
(S.D.N.Y. Bankr. 2011) (stating an “[e]mail communication
evidencing an agreement to modify the terms of an agreement
constitutes a ‘signed writing’ as per the statute of frauds, where
(1) the terms of the proposed modification are set forth in the
email; (2) a reply email evidences acceptance of the proposed
modification; and (3) the emails include signature blocks, which
signify an intent to authenticate”); R.D. Weis & Co., Inc. v. The

Children’s Place Retail Stores, Inc., No. 08-CV-4245, 2008 WL
4950962, at *4 n.2 (S.D.N.Y. Nov. 19, 2008) (“[T]he electronic
signatures at the bottom of the e-mails may qualify as signed
writings by [defendant] [since] Courts have held that a typed
signature in an e-mail can qualify as a signed writing.”). In
view of the foregoing, the FAC plausibly alleges that the Quinones
Email was a confirmatory writing and that the Merchant’s Exception
to the statute of frauds applies in Plaintiffs’ case. The Court
next turns to whether the FAC alleges facts sufficient to allege
that Quinones had the apparent authority to bind Heath to the 2021
Agreement.
ii. Quinones’ Apparent Authority to Bind Heath to
Terms of 2021 Agreement

“An agent can bind a principal by virtue of the agent’s
actual or apparent authority to act on the principal’s behalf.”
Richmond v. Montefiore Med. Ctr., No. 21-CV-8700, 2023 WL 6216271,
at *15 (S.D.N.Y. Sept. 25, 2023.) Apparent authority exists when
“from the ‘written or spoken words or any other conduct of the
principal which, reasonably interpreted, causes [a] third person
to believe that the principal consents to have [an] act done on
his behalf by the person purporting to act for him.” Minskoff v.
Am. Exp. Travel Related Servs. Co., 98 F.3d 703, 708 (2d Cir. 1996)
(quoting RESTATEMENT (SECOND) OF AGENCY 27 (1958)). “An employee’s
title alone can indicate [apparent] authority.” Merrill Lynch
Cap. Servs., Inc. v. UISA Fin., No. 09-CV-2324, 2012 WL 1202034,
at *18 (S.D.N.Y. Apr. 10, 2012) (citing Goldston v. Bandwidth Tech.
Corp., 52 A.D.3d 360 (1st Dep’t 2008)). “‘[T]he existence of
“apparent authority” depends upon a factual showing that the third
party relied upon the misrepresentations of the agent because of
some misleading conduct on the part of the principal - not the

agent.’” Montefiore Med. Ctr., 2023 WL 6216271, at *16 (quoting
Hallock v. State, 64 N.Y.2d 224, 231 (1984)). “[A] third party
with whom the agent deals may rely on an appearance of authority
only to the extent that such reliance is reasonable.” Id.
Consequently, “[t]o survive a motion to dismiss, a plaintiff must
allege facts, which, if proved, would show that the plaintiff
‘reasonably believed that [the agent] entered into the agreement

with [the plaintiff] on behalf of [the principal].” Buffalo
Xerographix, Inc. v. Hartford Ins. Grp., 540 F. Supp. 3d 382, 392
(W.D.N.Y. 2021) (alterations in original). “The existence of
apparent authority is normally a question of fact.” Id.
To the extent Plaintiffs argue the Quinones Email
suffices to bind Heath to the terms of the 2021 Agreement,
Defendant demurs. (Support Memo, at 7-9.) Defendant asserts
Plaintiffs cannot plausibly argue that Quinones had the authority
to bind Heath to the contract because Plaintiffs were on notice
“from the 2019 Agreement that a ‘duly authorized’ Heath
representative countersigns distribution agreements that Heath

enters into.” (Id. at 7.) Defendant highlights that the 2019
Agreement was signed by Wehnert “on February 1, 2019”, and returned
to Plaintiffs “after . . . Stern first executed it on January 29,
2019.” (Id.) Moreover, Defendant emphasizes Plaintiffs’
concession that Stern was never affirmatively told that Quinones
was either an attorney or had the authority to bind Heath to the
2021 Agreement.8 (Id.) Defendant points to Stern’s sworn

8 The Court has already determined that it will not consider the
Preliminary Injunction Hearing testimony in deciding the Dismissal
testimony that he assumed Quinones had authority. (Id.) Defendant
avers further that Quinones’ email to Plaintiffs during the
contract negotiations “do no more than indicate that she was aiding
[] Sims in the review process.” (Id. at 8.)

Here, the FAC pleads that Sims held Quinones out to have
the apparent authority to accept and finalize the 2021 Agreement
based upon her involved role in negotiating and reviewing
Plaintiffs’ redlines of the 2021 Agreement. (FAC ¶ 101.)
Specifically, the FAC alleges, inter alia, Sims “directed Stern to
speak directly with Quinones” regarding the 2021 Agreement and
proposed revisions, and that Sims had held Quinones “out as the
individual in charge of negotiating and finalizing Heath’s
contracts.” (Id. ¶¶ 90-91.) The FAC further alleges that Stern
believed Quinones was Heath’s General Counsel based upon her title
of “Manager of Legal” and that, at Sims’ direction, Stern and

Quinones engaged in telephone discussions in March of 2023, in
which they, negotiated and finalized the 2021 Agreement. (Id.)
Drawing all reasonable inferences in Plaintiffs’ favor, the Court
finds Sims’ representations to Stern that revisions to the 2021
Agreement should be sent to both Sims and Quinones “to review”,

Motion. Nevertheless, even if it were to consider the testimony,
Stern’s admission that nobody affirmatively told him Quinones was
an attorney does not automatically foreclose the possibility that
the FAC cannot plausibly allege Heath held Quinones out to have
apparent authority through other acts.
together with Quinones’ title, and her central role in reviewing
and negotiating the 2021 Agreement, suffices at this stage to
plausibly plead the existence of apparent authority. Moreover,
given that the reasonableness of Sterns’ reliance is likely a

question of fact, at the motion to dismiss stage the Court cannot
find that Stern’s reliance was unreasonable as a matter of law.
In sum, the Court finds the Quinones Email replying to
Stern’s email which attached the 2021 Agreement, and which affirmed
Quinones’ review and acceptance of Stern’s revisions, plausibly
suffices as a confirmatory writing based upon the electronic
signature block (see supra Part II.B.2.i.). The Court also finds
the FAC pleads sufficient facts to allege that Quinones had the
apparent authority to enter into the 2021 Agreement on Heath’s
behalf. “However, although the merchant exception allows
[plaintiffs] to proceed with their breach of contract claim despite

the Statute of Frauds, it does not establish that there was mutual
assent to the terms [of the 2021 Agreement], as a matter of law.”
See Atronic Int’l., GmbH v. SAI Semispecialists of Am., Inc.,
No. 03-CV-4892, 2006 WL 2654827, at *5 (E.D.N.Y. Sept. 15, 2006).
Consequently, the Court turns to the parties’ mutual assent
arguments next.
3. Whether the 2021 Agreement is Missing Essential
Terms

“To create a binding contract, ‘there must be a
manifestation of mutual assent sufficiently definite to assure
that the parties are truly in agreement with respect to all
material terms.’” Demand Elec., Inc. v. Innovative Tech. Holdings,
LLC, 665 F. Supp. 3d 498, 504 (S.D.N.Y. 2023) (quoting Express
Indus. & Terminal Corp. v. N.Y.S Dep’t of Transp., 93 N.Y.2d 584,
589 (1999)). Under the UCC, “[a] contract for [the] sale of goods
may be made in any manner sufficient to show agreement, including
conduct by both parties which recognizes the existence of such a
contract.” Id. at 505 (citing N.Y. UCC § 2-204(1) (alteration in
original)). This is a relatively liberal standard “and does not
require every contractual term to be spelled out in detail.” Id.
(quoting Dell’s Maraschino Cherries Co., Inc. v. Shoreline Fruit
Growers, Inc., 887 F. Supp. 2d 459, 471 (E.D.N.Y. 2012)). Where
a contract is for the sale of goods, “the essential terms are
quantity, price, and time and manner of delivery.” Alessi Equip.,
Inc., 578 F. Supp. 3d at 495 (quoting Fakhoury Enters., Inc. v.
J.T. Distrib., No. 94-CV-2729, 1997 WL 291961, at *3 (S.D.N.Y.
June 2, 1997)). However, where the parties to a contract fail to

specify either a time, price, and/or manner-of-delivery term, a
contract is not necessarily unenforceable since “the U.C.C.’s ‘gap
filling’ provisions supply ‘a reasonable time’ for shipment or
delivery; ‘a reasonable price at the time of delivery;’ and ‘the
seller’s place of business . . . [,] [the seller’s] residence’ or
any other location of the goods known by the parties” for the
manner-of-delivery. Id. (citing N.Y. UCC §§ 2-305(1); 2-308; 2-

309(1)). Additionally, “[a] lawful agreement . . . for exclusive
dealing in the kind of goods concerned imposes[,] unless otherwise
agreed[,] an obligation by the seller to use best efforts to supply
the goods and by the buyer to use best efforts to promote their
sale.” Id. (quoting N.Y. UCC § 2-306 & cmt.5) (alteration in
original). “Thus, the absence of a quantity term in an alleged
exclusive distributorship contract . . . does not make an
otherwise valid contract invalid.” Id. (citing Mega Tech Int’l
Corp. v. Miller Elec. Mfg. Co., No. 97-CV-1085, 1997 WL 790750, at
*3 (S.D.N.Y. Dec. 23, 1997)); cf Chartwell Therapeutics Licensing
LLC v. Citron Pharma LLC, No. 16-CV-3181, 2019 WL 12518722, at *5

(E.D.N.Y. Sept. 4, 2019) (“New York law recognizes a[n] ‘exclusive
dealing’ exception to the quantity rule.”).
Defendant highlights that the 2021 Agreement lacks
certain “material terms” including price, delivery terms, and
insurance terms. (See Support Memo at 9-10.) However, despite
confirming that the UCC was applicable to the 2021 Agreement it
has failed to address the applicability of the UCC’s gap filling
provisions to the 2021 Agreement.9
Plaintiffs highlight that the UCC’s gap filling
provisions supply many of the terms which Defendant highlights are

missing, including price; time and place of delivery; and quantity.
(Opp’n at 6.) Plaintiffs state that the inquiry the Court should
engage in is to “determine whether the parties intended to make a
contract despite leaving these terms open, and whether any dispute
over any of the terms undermines such an intent to be bound.” (Id.
(quotation marks and citation omitted).). Plaintiffs maintain an
examination of the Parties’ conduct highlights “there was
absolutely no dispute with regards to the price, insurance, and
time and place of delivery.” (Id. at 7.) Plaintiffs emphasize
that operation under the 2021 Agreement was consistent with the
Parties’ conduct under the 2019 agreement in that price fluctuated

and was based upon volume and timing of orders, and that City
Calibration “maintained insurance acceptable to Heath and had
already been provided with Heath’s insurance requirements.” (Id.
at 7-8.)
Here, contrary to Defendant’s contentions, the 2021
Agreement is not unenforceable for want of price, time, delivery,

9 Indeed, Defendant’s Reply on this issue focuses primarily on
caselaw applying the GOL, despite Defendant’s previous
acknowledgment that the UCC also applies to the 2021 Agreement.
or quantity terms because the UCC’s gap filling provisions can
provide them. Plaintiffs are correct in their assertion that the
issue for the Court to determine is the extent to which the
omission of these terms reflects that the parties did not intend

to be bound.
In determining whether two parties have formed a
contract, the court looks “not to the[] [parties’] ‘after-the-fact
professed subjective intent, but their objective intent as
manifested by their expressed words and deeds at the time’” of
contracting. Blake v. Fiit Int’l., Inc., No. 05-CV-6150, 2007 WL
980362, at *6 (S.D.N.Y. Mar. 30, 2007) (quoting Stetson v. Duncan,
707 F. Supp. 657, 666 (S.D.N.Y. 1988)); see also Antifun Ltd. T/A
Premium Vape, 616 F. Supp. 3d at 305 (“In determining whether the
parties entered into a contractual agreement . . . , it is
necessary to look . . . to the objective manifestations of the

intent of the parties as gathered by their expressed words and
deeds.”) (citation omitted); Asesores y Consejeros Aconsec CIA,
S.A. v. Glob. Emerging Mkts. N.A., Inc., 841 F. Supp. 2d 762, 767
(S.D.N.Y. 2012) (“[I]f a party’s objective actions support the
conclusion that he accepted an agreement, he will be bound to it
even if he never subjectively assented to the terms of the
agreement.”). Where the parties’ “expressions and conduct would
lead a reasonable person to conclude that they intended to reach
a binding agreement, the agreement is enforceable.” Kaplan v.
Vincent, 937 F. Supp. 307, 312 (S.D.N.Y. 1996).
Here, the FAC plausibly pleads facts sufficient to
survive Defendant’s Dismissal Motion. Specifically, the Court

finds the Quinones Email in which Quinones informed Plaintiffs
their revisions were “acceptable” and asked them to sign and return
the Agreement, together with the FAC’s allegation that Sims
contacted Stern to congratulate him on closing the deal,
cumulatively reflect an outward manifestation of intent by Heath
to be bound by the terms of the 2021 Agreement.10 Likewise, the
allegations in the FAC that the parties performed under the 2021
Agreement for a year, and that Heath held itself out to be City
Calibration’s partner lends further credence to Heath’s intent to
be bound. As to the open terms, Plaintiffs’ FAC plausibly alleges
that there was no dispute as to what these terms would be because

the Parties’ intention was to continue adhering to the practices
that they had developed under the 2019 Agreement. See Vinifera
Imps. Ltd. v. Societa Agricola Castello Romitorio SRL, No.
16-CV-0103, 2020 WL 1184962, at *5 (E.D.N.Y. Mar. 12, 2020) (“In
determining the intention of the contracting parties, it is proper

10 The Court also agrees with Plaintiffs insofar as the FAC also
pleads facts sufficient to plausibly allege that Sims had actual
authority to bind Heath to the 2021 Agreement. Likewise, the FAC
plausibly alleges facts sufficient to allege Sims’ outward
manifestations of intent indicated his acceptance of the 2021
Agreement.
to consider matters outside the writings, including the previous
dealings between the parties and the practices of the trade.”
(quoting Paper Corp. of U.S. v. Schoeller Tech. Papers, Inc., 807
F. Supp. 337, 347 (S.D.N.Y. 1992) (internal quotations omitted))).

Thus, Defendant’s motion to dismiss Plaintiffs’ Breach
of Contract Claim is denied.
C. Promissory Estoppel As to 2021 Agreement (Count Two)
In order to plead a promissory estoppel claim under New
York law, a plaintiff must prove three elements: (1) “a clear and
unambiguous promise”; (2) “reasonable and foreseeable reliance on
that promise”; and (3) “injury to the relying party as a result of
the reliance.” Lamda Sols. Corp. v. HSBC Bank USA, N.A., 574 F.
Supp. 3d 205, 214 (S.D.N.Y. 2021) (quoting Kaye v. Grossman, 202
F.3d 611, 615 (2d Cir. 2000)). “The existence of a valid and
enforceable written contract governing a particular subject matter

ordinarily precludes recovery in quasi-contract for events arising
out of the same subject matter.” Dart Brokerage Corp. v. Am. Com.
Ins. Co., No. 13-CV-4014, 2013 WL 5966901, at *2 (S.D.N.Y. Nov. 7,
2013) (quoting Clark-Fitzpatrick, Inc. v. Long Island R.R. Co., 70
N.Y.2d 382, 388 (1987) (alteration omitted)). However, “it is
also well-established that plaintiffs who allege the existence of
a valid contract may nonetheless plead the alternative theories of
promissory estoppel and breach of contract when the defendant does
not concede the enforceability of such contract.” Lamda Sols.,
Corp., 574 F. Supp. 3d at 214 (quoting Pers. Watercraft Prod. SARL
v. Robinson, No. 16-CV-9771, 2017 WL 4329790, at *11 (S.D.N.Y.
Sept. 1, 2017)).
“A claim for promissory estoppel may not be maintained

under New York law where the alternative claim for breach of
contract is barred by the Statute of Frauds, unless the
circumstances make it unconscionable to deny the promise upon which
the plaintiff relied.” United Mag. Co. v. Murdoch Mag. Distrib.,
Inc., 146 F. Supp. 2d 385, 405 (S.D.N.Y. 2001). “To satisfy the
‘unconscionable injury’ threshold, Plaintiff ‘must demonstrate
injuries beyond those that flow naturally from the defendant’s
non-performance or from the plaintiff’s continuing performance of
the unenforceable agreement.’” Darby Trading, Inc. v. Shell
Intern. Trading and Shipping Co. Ltd., 568 F. Supp. 2d 329, 341
(S.D.N.Y. 2008) (quoting Mobile Data Shred, Inc. v. United Bank of

Switz., No. 99-CV-10315, 2000 WL 351516. at *4 (S.D.N.Y. Apr. 5,
2000)). “[I]n the absence of ‘egregious’ circumstances, courts
have consistently rejected promissory estoppel claims when the
alleged injuries consisted of lost profits, lost fees, forgone
business opportunities or damage to business reputation.” Bd. of
Managers of Trump Tower at City Ctr. Condo. by Neiditch v.
Palazzolo, 346 F. Supp. 3d 432, 470 (S.D.N.Y. 2018) (quoting
Komlossy v. Faruqi & Faruqi, LLP, No. 15-CV-9316, 2017 WL 722033,
at *8 (S.D.N.Y. Feb. 23, 2017)).
Plaintiffs acknowledge that their promissory estoppel
claim was pled with the intention that the Court apply promissory
estoppel “[i]n the event the Court determines the Statute of Frauds
applies”. (Opp’n at 11.) Consequently, to plead in the

alternative a viable promissory estoppel claim, New York law
requires Plaintiffs to demonstrate unconscionable injury.
Plaintiffs argue they have demonstrated unconscionable injury by
pleading facts which demonstrate they have suffered, inter alia,
“the near total loss of City Calibration’s business, the complete
loss of the time and money spent developing a smart app to pair
with the Products, the loss of City Calibration and Platsky’s
customer goodwill . . . and the loss of opportunity to develop
City Calibration’s business on Long Island.” (Id. at 16-17 n.8.)
Here, none of the injuries pled rise to the level of
unconscionable injury because, as aptly highlighted by Defendant,

the damages caused by such injuries “flow naturally from the breach
of the” 2021 Agreement. Courts in this District have found that
damages of the kind pled here do not suffice to establish
unconscionable injury sufficient to maintain a promissory estoppel
claim. See Darby Trading, 568 F.Supp.2d at 341, (finding
“injuries, consisting of lost clients and lost opportunities,
while perhaps significant to Plaintiff, are most aptly described
as the expectation damages of [] non-performance of the
[parties’] . . . agreement”); N. Am. Knitting Mills, Inc. v. Int’l
Women’s Apparel, No. 99-CV-4643, 2000 WL 1290608, at *3 (S.D.N.Y.
Sept.12, 2000) (finding no unconscionable injury where plaintiff
pled it had “incurred substantial expenses to upgrade its operating
capacity and lost other substantial clients” since such injury

“flows naturally from defendant’s non-performance of the alleged
agreement”); Ellis v. Provident Life & Accident Ins. Co., 3 F.
Supp. 2d 399, 411 (S.D.N.Y. 1998) (“[I]t is well established under
New York law that injuries resulting in a[ ] . . . decision to
forgo other career opportunities do not constitute unconscionable
injuries.”); Schoeller Tech. Papers, 724 F. Supp. at 118-19
(S.D.N.Y. 1989) (finding that making investments in plant and
capital equipment, increasing payroll and foregoing other business
opportunities does not constitute unconscionable injury.)
Accordingly, Plaintiffs may not invoke promissory
estoppel to overcome application of the N.Y. UCC and/or GOL Statute

of Frauds should their breach of contract claim fail
post-discovery.11

11 To the extent Plaintiffs liken their case to the facts in
Cyberchron Corporation v. Calldata Systems Development, Inc., 47
F.3d 39 (2d Cir. 1995), the Court is unconvinced. As an initial
matter, the FAC is wholly devoid of facts supporting Plaintiffs’
contention that Defendant “continually pressured Plaintiffs to
purchase more Product”; this alone differentiates the facts in the
case at bar from those in Cyberchron.
D. Fraudulent Inducement as to the 2019 Agreement (Count
Four)12

1. The 2019 Choice-of-Law Clause

As a threshold matter, the Court must determine which
States’ law, New York or Texas, applies to Plaintiffs’ fraudulent
inducement claim. Plaintiffs argue Texas law should apply because
the 2019 Agreement contains a Texas choice-of-law provision.
(Opp’n at 19.) The Court disagrees.
“Under New York law, a choice-of-law provision
indicating that the contract will be governed by a certain body of
law does not dispositively determine that law which will govern a
claim of fraud arising incident to the contract.” Yak v. Bigger
Pockets, L.L.C., No. 20-CV-3498, 2022 WL 67740, at *3 (2d Cir.
Jan. 7, 2022) (quoting Krock v. Lipsay, 97 F.3d 640, 645 (2d Cir.
1996)). To that end, “[u]nder New York law, . . . tort claims are
outside the scope of contractual choice-of-law provisions that
specify what law governs construction of the terms of the
contract”. Fin. One Public Co. Ltd. V. Lehman Bros. Special Fin.,
Inc., 414 F.3d 325, 355 (2d Cir. 2005). While “a contractual
choice-of-law clause could be drafted broadly enough to reach such
tort claims”, id., “New York courts have shown ‘reluctance to read
choice-of-law clauses broadly.’” Ramiro Aviles v. S & P Glob.,

12 The Fraudulent Inducement Claim is the only claim Plaintiffs
bring in connection with the 2019 Agreement.
Inc., 380 F. Supp. 3d 221, 270 (S.D.N.Y. 2019). Generally,
“provisions applying to disputes ‘arising out of’ or ‘relating to’
a contract are capacious enough to reach related tort claims, while
provisions stating that a contract will be ‘governed by’ or

‘construed in accordance with’ the law of a state are not.”
Chigirinskiy v. Panchenkova, No. 14-CV-4410, 2015 WL 1454646, at
*6 (S.D.N.Y. Mar. 31, 2015) (quoting Refco Grp. Ltd., LLC v. Cantor
Fitzgerald, L.P., No. 13-CV-1654, 2014 WL 2610608, at *40 (S.D.N.Y.
June 10, 2014)).
Here, Plaintiffs’ fraudulent inducement claim sounds in
tort, not contract. See Yookel, Inc. v. U.S. Steel Corp., 2022 WL
542379, at *4 (E.D.N.Y. Feb. 23, 2022) (stating a fraudulent
inducement claim is a claim which does not “sound in contract” and
was thus “not governed by the . . . Agreement’s choice of law
provision”); see also Dessert Beauty, Inc. v. Platinum Funding

Corp., No. 06-CV-2279, 2006 WL 3780902, at *5 (S.D.N.Y. Dec. 26,
2006) (“[T]he choice of law provision does not determine which
state’s law should apply to the tort claim [for fraudulent
inducement].”). Moreover, the 2019 Agreement’s choice-of-law
provision is akin to the narrow provisions which New York courts
hold are not broad enough to reach related tort claims.13 Compare

13 The 2019 Agreement’s choice-of-law provision is in Section 12(k)
and reads: “This Agreement shall be governed and interpreted in
accordance with the laws of the State of Texas. Venue of any
dispute shall lie in Harris County, Texas.”
Ramiro Aviles, 380 F. Supp. 3d at 271 (finding choice-of-law
provision that read “[t]his Agreement shall be governed by, and
construed in accordance with, the laws of the State of New
York . . . fits to a tee the sort of contractual language that

courts applying New York law have held insufficient to cover tort
claims”); and Knieriemen v. Bache Halsey Stuart Shields Inc., 74
A.D.2d 290, 293 (1st Dep’t 1980) (finding, where contract contained
choice-of-law clause which “recited that ‘[t]his contract shall be
governed by the laws of the State of New York’”, such clause was
not broad enough to encompass tort claims), with Turtur v.
Rothschild Registry Intern., Inc., 26 F.3d 304, 309-10 (2d Cir.
1994) (rejecting appellant’s contention that the choice-of-law
claim in the at-issue agreement did not apply to fraud claim
because the fraud claim sounded in tort where appellants had
“agreed to be bound by a choice of law provision that covers any

controversy ‘arising out of or relating to’ the subscription”).
In view of the foregoing, the Court finds the
choice-of-law provision in the 2019 Agreement does not apply to
Plaintiffs’ fraudulent inducement claim.
2. Choice of Law Analysis

A federal Court “sitting in diversity jurisdiction must
apply the law of the forum state to determine the choice-of-law.”14

14 The basis for removing this case from the State Court to this
Court was the existence of diversity jurisdiction since “both
Fieger v. Pitney Bowes Credit Corp., 251 F.3d 386, 393 (2d Cir.
2001) (citing Klaxon Co. v. Stentor Elec. Mfg. Co., 313 U.S. 487,
497 (1941)). “Typically, New York courts apply New York’s
substantive law to cases filed in New York.” Ramiro Aviles, 380

F. Supp. 3d at 271 (citing Wall v. CSX Transp., Inc., 471 F.3d
410, 415 (2d Cir. 2006)). However, “where a party has identified
a conflict between New York’s tort law and the tort laws of another
relevant jurisdiction, a New York court will apply ‘[t]he law of
the jurisdiction having the greate[r] interest in the
litigation.’” Id. (quoting GlobalNet Financial.com, Inc. v. Frank
Crystal & Co., 449 F.3d 377, 383 (2d Cir. 2006)). Where the
parties are domiciled in different states, “the locus of the tort
will almost always be determinative in cases involving conduct-
regulating laws.” Yookel, Inc., 2022 WL 542379, at *4 (quoting
Chigirinskiy, 2015 WL 1454646, at *6 n.7); see also H.S.W. Enters.,

Inc. v. Woo Lae Oak, Inc., 171 F. Supp. 2d 135, 142 (S.D.N.Y. 2001)
(same). “New York courts consider the locus of a fraud to be the
place where the injury was inflicted and not the place where the
fraudulent act originated.” Id. (quoting H.S.W. Ents., Inc., 171
F. Supp. 2d at 142).

plaintiffs are New York corporations with their principal places
of business in the State of New York” and the “sole defendant is
a Delaware corporation with its principal place of business in the
State of Texas.” (See Notice of Removal at 1.)
Here, Platsky is a New York-based domiciliary which
maintains its principal place of business in New York. (See FAC
¶ 17.) The 2019 Agreement is a distribution contract in which
Platsky contracted to purchase and sell products from Defendant

for distribution in the New York Metropolitan Area market, to New
York LMPs. (See 2019 Agreement, Ex. A.) New York is the locus of
Plaintiffs’ injury; therefore, New York law applies to their
fraudulent inducement claim.
3. Fraudulent Inducement15

“To state a claim for fraudulent inducement under New
York law, a plaintiff must allege: ‘(1) a material
misrepresentation or omission that induced the party to sign the
contract; (2) scienter; (3) reliance; and (4) injury.’” Centauro
Liquid Opportunities Master Fund, L.P. v. Bazzoni, No. 15-CV-9003,

15 The Court acknowledges that the 2019 Agreement contains a merger
clause and, as highlighted by Defendant, that there are instances
in which a merger clause forecloses a fraudulent inducement claim.
However, such clauses generally must “state[] that a contracting
party disclaims the existence of or reliance upon [a] specified
representation.” Mfrs. Hanover Tr. Co. v. Yanakas, 7 F.3d 310,
315 (2d Cir. 1993) (citing Citibank, N.A. v. Plapinger, 66 N.Y.2d
90, 94-95 (1985)). The general rule is that “‘an omnibus statement
that the written instrument embodies the whole agreement, or that
no representations have been made’ is insufficient to bar a claim
of fraudulent inducement.” PetEdge, Inc., 234 F. Supp. 3d at 488
(quoting Mfrs. Hanover Tr. Co., 7 F.3d at 315). The Court finds
that the merger clause contained in the 2019 Agreement is more
akin to a standard omnibus statement which does not identify the
specific representations upon which Plaintiffs’ fraudulent
inducement claim is premised. Notwithstanding this finding, the
Court finds Plaintiffs have failed to adequately plead scienter as
to their fraud claim.
2017 WL 3726754, at *4 (S.D.N.Y. Aug. 28, 2017) (quoting Davidowitz
v. Patridge, No. 08-CV-6962, 2010 WL 5186803, at *7 (S.D.N.Y. Dec.
7, 2010)).
Additionally, fraud claims are evaluated with reference

to the heightened pleading standards established by Federal Rule
of Civil Procedure 9(b). Rule 9(b) “places ‘two further burdens
on fraud plaintiffs—the first goes to the pleading of the
circumstances of the fraud, the second to the pleading of the
defendant’s mental state.’” Id. at *5 (quoting Loreley Fin.
(Jersey) No. 3 Ltd. V. Wells Fargo Sec., LLC, 797 F.3d 160, 171
(2d Cir. 2015)); see also Nakahata v. N.Y.-Presbyterian Healthcare
Sys. Inc., 723 F.3d 192, 197 (2d Cir. 2013) (“Allegations of fraud
are subject to a heightened pleading standard. When alleging
fraud, ‘a party must state with particularity the circumstances
constituting fraud,’ . . . which we have repeatedly held requires

the plaintiff to ‘(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.’” (first quoting FED. R. CIV. P. 9(b);
then quoting Mills v. Polar Molecular Corp., 12 F.3d 1170, 1175
(2d Cir. 1993))). The facts alleged must “give rise to a strong
inference of fraudulent intent.” First Cap. Asset Mgmt., Inc. v.
Satinwood, Inc., 385 F.3d 159, 179 (2d Cir. 2004) (emphasis in
original) (citation omitted).
Plaintiffs’ fraudulent inducement claim is based upon
two alleged representations and one material omissions of fact
which it contends Defendant utilized to induce Platsky into the
2019 Agreement.16 First, Plaintiffs allege Heath “falsely

represented that it had the ability to grant Plaintiffs an
exclusive distributorship of all the Products described in the
2019 Agreement” (the “Exclusive Distributorship Representation”)
(Opp’n at 20-21). Second, Plaintiffs assert Heath “falsely
represented that the LMP200 could connect via Bluetooth to a
service provider’s personal device to efficiently store and
transfer the data through software applications already created by
the local utility companies” (the “Bluetooth Capability
Representation”). (Id. at 21.) Finally, Plaintiffs contend Heath
“omitted that the LMP200 devices would stop working if the data
was not removed on a regular basis and that there was, at the time,

no means for removing or storing that data” (the “Data Removal
Omission”). (Id.) Plaintiffs argue the FAC adequately alleges
“that these representations were false and that Heath [k]new these
statements were false at the time its representatives made them.”
(Id.) Plaintiffs aver Heath, nonetheless, intended for Plaintiffs

16 Plaintiffs presented their fraudulent inducement argument under
Texas law only. However, the Court has already determined New
York law governs their fraudulent inducement claim.
to rely upon the false statements and omission and that it did
this “by including them in the contract itself.” (Id.)
Defendant contends the FAC fails “to allege that Heath
intended to fraudulently induce Platsky to enter into the 2019

Agreement” and that this failure is fatal to their fraudulent
inducement claim. (Support Memo at 16.) Defendant elaborates,
“[s]imply alleging that Heath ‘knew’ its statements concerning
Bluetooth connectivity were false when made is insufficient”.
(Id.) Defendant emphasizes that the plain language of the contract
contradicts Plaintiffs’ claim that Heath represented it could
grant Plaintiffs an exclusive distributorship since the contract
states that “[a] contractor would have the option of purchasing
the ABC calibration station and calibration gasses from Platsky or
could use the extensive network of distributors and locations in
the surrounding NYC area.” (Reply at 6.) Finally, Defendant

argues the FAC as pled fails to plead fraud with particularity.
Defendant contends the FAC’s allegations that Wehnert and Sims
made false representations are insufficient in this regard since
the FAC does not specify “to whom these purported representations
were made and how they were communicated.” (Reply 6-7.)
i. The Exclusive Distributorship Representation
was Meaningfully Contradicted by the Written
Terms of the 2019 Agreement

As an initial matter, the Court finds the Exclusive
Distributorship Representation cannot form the basis of a
fraudulent inducement claim since it is contradicted in a
meaningful way by the plain terms of the 2019 Agreement, to wit,
the 2019 Agreement’s statement that: “A contractor would have the
option of purchasing the ABC calibration station and calibration

gasses from Platsky or could use the extensive network of
distributors and locations in the surrounding NYC Area.”17 See
Republic Nat’l Bank v. Hales, 75 F. Supp. 2d 300, 315 (S.D.N.Y.
1999) (“Under New York law, reasonable reliance is precluded when
‘an express provision in a written contract contradicts a prior
alleged oral representation in a meaningful fashion.’” (quoting
Villa Marin Chevrolet v. Gen. Motors Corp., No. 98-CV-6167, 1999
WL 1052494, at *5 (E.D.N.Y. Nov. 18, 1999))). Plaintiffs are
sophisticated parties such that this provision should have
prompted further inquiry from them considering Plaintiffs believed
they were to be the exclusive distributer of the Products.18 See

Tevac, Inc. v. Dynamics eShop, Inc., No. 19-CV-3650, at *3
(E.D.N.Y. Sept. 27, 2022) (Seybert, J.) (“As a sophisticated

17 Even if this were not the case, the Court finds the FAC does not
sufficiently allege facts plausibly supporting the scienter
element of a fraudulent inducement claim.

18 The Court finds that the FAC’s factual statement that Platsky
has been in business for nearly a century supports the Court’s
conclusion that Platsky was a sophisticated party at the time of
the 2019 negotiations. See e.g., Taylor Precision Prods., Inc. v.
Larimer Grp. Inc., No. 15-CV-4428, 2018 WL 4278286, at *25 n.20
(S.D.N.Y. Mar. 26, 2018) (finding where plaintiff was, inter alia,
“a corporation founded in 1851” the plaintiff was a sophisticated
party).
business entity, [plaintiff’s] time to address any purported
ambiguity was during negotiations. Given the parties’ dispute
arises from a contract that was negotiated as part of an arm’s
length business transaction between two undisputed sophisticated

business entities[, plaintiff] will not be heard to object about
the plain language of the Agreement.”) (internal quotation marks
and alterations omitted); see also Clifton v. Vista Comput. Servs.,
LLC, No. 01-CV-10206, 2002 WL 1585550, at *4 (S.D.N.Y. July 16,
2002) (“When a promise is not extraneous to the terms of the
contract, a plaintiff with this level of business sophistication
cannot make out a claim that he reasonably relied on those
promises.”).
ii. Plaintiffs Have Failed to Adequately Plead
Scienter

“[A]llegations of scienter . . . are not subjected to
the more exacting consideration applied to the other components of
fraud.” 380544 Can., Inc. v. Aspen Tech., Inc., 633 F. Supp. 2d
15, 29 (S.D.N.Y. 2009) (quoting Breard v. Sachnoff & Weaver, Ltd.,
941 F.2d 142, 143 (2d Cir. 1991)) (alteration in original).
Nevertheless, while “[m]alice, intent, knowledge and other
condition of the mind of a person may be averred
generally,’ . . . this leeway is not a ‘license to base claims of
fraud on speculation and conclusory allegations.’” Eternity Glob.
Master Fund Ltd. V. Morgan Guar. Tr. Co. of N.Y., 375 F.3d 168,
187 (2d Cir. 2004) (first quoting FED. R. CIV. P. 9(b); then quoting
Acito v. IMCERA Grp., Inc., 47 F.3d 47, 52 (2d Cir. 1995)).
Plaintiffs “‘must allege facts that give rise to a strong inference
of fraudulent intent,’ which may be established ‘either (a) by

alleging facts to show that defendants had both motive and
opportunity to commit fraud, or (b) by alleging facts that
constitute strong circumstantial evidence of conscious misbehavior
or recklessness.’” Id. (quoting Shields v. Citytrust Bancorp,
Inc., 25 F.3d 1124, 1128 (2d Cir. 1994)).
Plaintiffs represent they have alleged facts
constituting strong circumstantial evidence of conscious
misbehavior or recklessness.19 (Opp’n at 23.) In doing so,
Plaintiffs highlight the FAC pleads, at the time it negotiated the
2019 Agreement, Heath knew that the representations regarding the
Products’ capabilities were false yet it failed to take additional

steps to remedy the issues. (Id.)
Notwithstanding that knowledge may be averred to
generally, the Court finds the FAC does not adequately plead
scienter. Instead, the FAC simply states in conclusory fashion
that Heath knew its statements were false without alleging facts

19 Plaintiffs do not proffer that Heath had any motive to commit
fraud. However, “[w]here motive is not apparent, it is still
possible to plead scienter by identifying circumstances indicating
conscious behavior by the defendant, though the strength of the
circumstantial allegations must be correspondingly greater.”
Kalnit v. Eichler, 264 F.3d 131, 142 (2d Cir. 2001).
as to how Heath and/or its representatives possessed such
knowledge. See e.g., PetEdge, Inc., 234 F. Supp. 3d at 495
(finding allegations that the alleged scheme “was done ‘with
[defendant’s] knowledge and approval’ are too conclusory and

speculative” to support a fraudulent inducement claim); see also
Citytrust Bancorp, Inc., 25 F.3d at 1129 (holding factual
assertions coupled with conclusory allegations that defendants
“knew or should have known” or “knew but concealed” are “so broad
and conclusory as to be meaningless”); High View Fund, L.P. v.
Hall, 27 F. Supp. 2d 420, 426-27 (S.D.N.Y. 1998) (“Neither
plaintiffs’ conclusory allegations of the [defendant’s] knowledge
and intent . . . support an inference of fraud.”). Similarly,
there are no factual allegations pleaded that would allow the Court
to infer that Defendant and/or its Representatives learned of, or
possessed, the aforementioned knowledge at the time of the 2019

negotiations. Defendant’s knowledge its representations were
false would have to have been in its possession prior to when
negotiations of the 2019 Agreement began, the FAC pleads no facts
plausibly alleging this was the case. See e.g., Banco Espirito
Santo de Investimento, S.A. v. Citibank, N.A., No. 03-CV-1537,
2003 WL 23018888, at *13 (S.D.N.Y. Dec. 22, 2003) (“[Plaintiff]
has failed to plead a cause of action for fraudulent inducement
because it has not alleged that Citibank knew the statements to be
false at the time the statements were made or that Citibank
intended to defraud BESI.”) Indeed, there are no supportive
factual allegations in the FAC that nudge Plaintiffs’ fraud
allegations from the conclusory to the plausible.
E. Common Law Unfair Competition (Count Three)

“The law of unfair competition in New York encompasses
a broad range of unfair practices.” CA, Inc. v. Simple.com, Inc.,
621 F. Supp. 2d 45, 52 (E.D.N.Y. 2009). “To state a claim for
unfair competition under New York law, ‘a plaintiff must allege
that a defendant misappropriated plaintiff’s labor, skills,
expenditures or good will, and displayed some element of bad faith
in doing so.’” TileBar v. Tiles, No. 22-CV-3823, 2024 WL 1186567,
at *19 (E.D.N.Y. Mar. 15, 2024) (quoting Data Device Corp. v. W.G.
Holt, Inc., No. 19-CV-4105, 2020 WL 7024312, at *6 (Nov. 30,
2020)); see also Coca-Cola, N.A. v. Crawley Juice, Inc.,
No. 09-CV-3259, 2011 WL 1882845, at *6 (E.D.N.Y. May 17, 2011)

(“[T]he essence of an unfair competition claim is that ‘the
defendant has misappropriated the labors and expenditures of
another’ and has done so in bad faith.” (quoting Saratoga Vichy
Spring Co. v. Lehman, 625 F.2d 1037, 1044 (2d Cir. 1980))).
“Although unfair competition often involves misappropriation of
trade secrets or ideas, a claim may be based on misappropriation
of client lists, internal company documents, and business
strategies ‘if wrongful or fraudulent tactics [are] employed.’”
Barbagallo v. Marcum LLP, 820 F. Supp. 2d 429, 447 (E.D.N.Y. 2011)
(quoting Leo Silfen, Inc. v. Cream, 29 N.Y.2d 387, 328 (1972)).
Additionally, “when a business . . . possesses goodwill
constituting property or a commercial advantage in [New York],
that goodwill is protected from misappropriation under New York

unfair competition law.” RBG Mgmt. Corp. v. Vill. Super Mkt.,
Inc., No. 22-CV-7996, 2023 WL 5976273, at *10 (S.D.N.Y. Sept. 4,
2023) (quoting ITC Ltd. v. Punchgini, Inc., 9 N.Y.3d 467, 476
(2007)).
Typical, and illustrative, examples of unfair
competition claims include: “when a defendant
takes a plaintiff’s customer list and uses it
to divest business away from plaintiff and to
defendant, or when a defendant obtains access
to a plaintiff’s proprietary technology for a
mobile ticketing platform as part of a
potential partnership effort to win bids from
mass transit agencies and then uses that
proprietary information to submit its own bid
while freezing plaintiff out of the
transaction.”

Id. (quoting Red Mountain Med. Holdings, Inc., 563 F. Supp. 3d
159, 181-82 (S.D.N.Y. 2021)).
Defendant primarily advances four arguments in support
of its Dismissal Motion as to this count. First, Defendant argues
“Plaintiffs have failed to allege that [the] 2021 Draft is a valid
agreement or that a confidential relationship existed” between the
parties. (Support Memo at 21.) Similarly, “there was no non-
compete agreement that existed between the parties.” (Id.)
Second, Defendant contends the FAC does not allege “any
misappropriation by Heath of [Plaintiffs’] exclusive commercial
advantage, trade secrets, or other property,20 and, that
“[i]nternal sharing of information is insufficient to support a
claim for unfair competition.” (Id.) Finally, Defendant

highlights Plaintiffs have neither alleged “what customers, if
any, were lost as a result of Heath’s actions” nor pled “how
Heath’s nonexclusive control of the Products was done in bad
faith.” (Id. at 22.)
Plaintiffs counter that they have pled a
misappropriation claim in that the FAC alleges “Heath
misappropriated City Calibration’s commercial advantage when it
entered the New York City Metropolitan Area market and falsely
advertised that it was ‘taking over’ City Calibration’s
distribution and calibration business.” (Opp’n at 18). Plaintiffs
maintain “Heath did this secretly and in [] violation of its

promise not to compete with City Calibration.” (Id.) Plaintiffs
contend Heath’s “purpose in doing so . . . was to cause Plaintiffs
to use its longstanding relationships with plumbers and
[plumbers’] unions in the New York City Metropolitan Area to

20 On arguing Plaintiffs have not pled any misappropriation by
Heath of an exclusive commercial advantage owned by Plaintiffs,
Defendant appears to cite to the 2019 Agreement’s language a vast
network of distributors could sell the products to contractors.
The Court notes, as highlighted by Plaintiffs, the 2019 Agreement
does not form the basis of Plaintiffs’ unfair competition claim.
Instead, this claim is premised upon the 2021 Agreement.
develop the customer base for the Products, and then misappropriate
that customer base through false representations.” (Id.)
Plaintiffs highlight the 2021 Agreement “promised Plaintiffs
exclusive access to the market by making City Calibration Heath’s

exclusive distributor in the area.” (Id.)
The Parties’ respective arguments on Plaintiffs’ unfair
competition claim are enigmatic; however, the exclusive commercial
advantage upon which Plaintiffs’ unfair competition claim is
premised hinges upon whether the 2021 Agreement is a valid,
enforceable, contract. If the 2021 Agreement is enforceable then,
by its terms, Plaintiffs enjoyed the exclusive right to sell the
Products in the North American territory when Defendant knowingly
entered the New York City Metropolitan Area market and
misappropriated that advantage. The Court has already determined
that the FAC plausibly alleges the 2021 Agreement was a valid

contract, notwithstanding Defendants’ Statute of Frauds arguments.
Consequently, the Court declines to dismiss the unfair competition
claim at this stage. See Piccoli A/S v. Calvin Klein Jeanswear
Co., 19 F. Supp. 2d 157, 169 (S.D.N.Y. 1998) (denying motion to
dismiss unfair competition claim where “essence of [plaintiff’s]
claim [was] that defendants’ action in selling [the product] into
plaintiff’s arguably exclusive territory was akin to
misappropriation or passing off, [which are] traditional bases of
unfair competition relief.”).21
F. Tortious Interference with Economic Advantage (Count
Five)

To successfully plead a claim for tortious interference
with economic advantage, a plaintiff must allege: “(1) it had a
business relationship with a third party; (2) the defendant knew
of that relationship and intentionally interfered with it; (3) the
defendant acted solely out of malice, or used dishonest, unfair,
or improper means; and (4) the defendant’s interference caused
injury to the relationship.” Kirch v. Liberty Media Corp., 449
F.3d 388, 400 (2d Cir. 2006) (quoting Carvel Corp. v. Noonan, 350
F.3d 6, 17 (2d Cir. 2003)). The plaintiff must also allege that
it “would have entered into an economic relationship but for the
defendant’s wrongful conduct.” Corning Inc. v. Shenzhen Xinhao
Photoelectric Tech. Co., Ltd., 546 F. Supp. 3d 204, 215 (W.D.N.Y.
2021) (quoting Downtown Music Publ’g LLC v. Peloton Interactive,

21 The Court notes, however, that “[w]here a plaintiff’s unfair
competition claim is based entirely on the same alleged conduct
proscribed by contract, and plaintiff has pled a breach of contract
claim, the unfair competition claim is dismissed as duplicative of
the breach claim.” Bytemark, Inc. v. Xerox Corp., 342 F. Supp. 3d
496, 508 (S.D.N.Y. 2018) (collecting cases). Neither Party briefed
nor raised this issue as part of Defendant’s Dismissal Motion.
Since the Court, at this stage of the litigation, does not know
“whether the breach of contract claim . . . will survive post-
discovery”, it will allow the unfair competition claim to proceed
at this juncture. Accord N. Shore Window & Door, Inc. v. Andersen
Corp., No. 19-CV-6194, 2021 WL 4205196, at *13 n.12 (E.D.N.Y. Aug.
3, 2021).
Inc., 436 F. Supp. 3d 754, 766 (S.D.N.Y. 2020)). “‘[A]s a general
rule, a defendant’s conduct must amount to a crime or an
independent tort’ in order to amount to tortious interference with
a prospective economic advantage.” Friedman v. Coldwater Creek,

Inc., 321 F. App’x 58, 60 (2d Cir. 2009) (quoting Carvel Corp., 3
N.Y.3d at 190). “A defendant who has not committed a crime or
independent tort or acted solely out of malice may nevertheless be
liable if he has employed ‘wrongful means,’” i.e., “physical
violence, fraud or misrepresentation, civil suits and criminal
prosecutions, and extreme and unfair economic pressure.” Id.
(quotation marks and citation omitted). However, where a defendant
acts “with a permissible purpose, such as ‘normal economic self-
interest,’ wrongful means have not been shown, even if the
defendant was ‘indifferent to the [plaintiff’s] fate.” 16 Casa
Duse, LLC v. Merkin, 791 F.3d 247, 262 (2d Cir. 2015). Likewise,

“New York courts have dismissed complaints that failed to allege
the specific business relationship that was interfered with.”
Mastercraft Decorators, Inc. v. Orlando, 356 F. Supp. 3d 259, 267
(W.D.N.Y. 2018) (quoting Johnson & Johnson v. Am. Nat’l Red Cross,
528 F. Supp. 2d 462, 464 (S.D.N.Y. 2008)); see also Lesesne v.
Brimecome, 918 F. Supp. 2d 221, 227 (S.D.N.Y. 2013) (finding the
weight of authority “requires a plaintiff to identify the potential
customers at issue when asserting a cause of action for
interference with prospective economic advantage”) (collecting
cases).
Defendant argues, inter alia, the FAC’s allegation that
Plaintiffs have “‘established business relationships with LMPs and

organizations of LMPs’ and ‘plumbers unions and organizations,’
without naming a single customer” is too conclusory to sustain
their tortious interference claim. (Support Memo at 23.) The
Court agrees.
The FAC presently identifies no specific customer with
which Plaintiffs had a valid business relationship and with which
Defendant interfered; this failure is fatal to Plaintiffs’
tortious interference with economic advantage claim. See
Plasticware, LLC v. Flint Hills Res., LP, 852 F. Supp. 2d 398, 402
(S.D.N.Y. 2012) (“Plaintiff has not adequately alleged specific
business relationships with which Defendant allegedly interfered.”

(emphasis in original); Bayer Schera Pharma AG v. Sandoz, Inc.,
No. 08-CV-3710, 2010 WL 1222012, at *8 (S.D.N.Y. Mar. 29, 2010)
(dismissing tortious interference claim where plaintiff “ha[d] not
identified any specific business entities with which it had
business relationships.”); Am. Bldg. Maint. Co. of N.Y. v. Acme
Prop. Servs., Inc., 515 F. Supp. 2d 298, 316 (N.D.N.Y. 2007)
(“Allegations of tortious interference must be more than just mere
suspicions, and, therefore, the complaint must allege
‘interference with a specific identified business relationship
with a third party.’” (quoting Camp Summit of Summitville, Inc. v.
Visinski, No. 06-CV-4994, 2007 WL 1152894, at *14 (S.D.N.Y. Apr.
16, 2007))). Indeed, the allegations that Plaintiffs have
relationships with LMPs, plumbers’ unions and organizations of

LMPs is vague, and is similar to the relationships with “third-
party cover glass manufacturers and mobile device companies and
manufacturers” which the plaintiff pled in Corning. 546 F. Supp.
3d at 216. The Corning court dismissed the Corning plaintiff’s
tortious interference claim because, inter alia, “the claim [was]
insufficiently specific.” Id. The Corning court emphasized that
to sufficiently plead a tortious interference claim; a plaintiff
is required to “identify the potential customers at issue.” Id.
(quoting Lesesne, 918 F. Supp. 2d at 227). Compare Faiveley
Transp. USA, Inc. v. Wabtec Corp., 758 F. Supp. 2d 211, 221-22
(S.D.N.Y. 2010) (denying motion to dismiss tortious interference

with prospective economic advantage claim where plaintiff
“allege[d] with particularity no less than ten business
relationships with which [defendant] interfered, and includes in-
depth discussion of one business relationship in particular, with
New York City Transit”).

[Remainder of page intentionally left blank]
CONCLUSION22
For the stated reasons, IT IS HEREBY ORDERED that
Defendant’s Motion to Dismiss (ECF No. 29) is GRANTED IN PART AND
DENIED IN PART to the extent that:
1. Defendant’s Motion to Dismiss Plaintiffs’ Breach

of Contract claim (Count One) is DENIED;
2. Defendant’s Motion to Dismiss Plaintiffs’
Promissory Estoppel Claim (Count Two) is GRANTED;
3. Defendant’s Motion to Dismiss Plaintiffs’ Unfair
Competition claim (Count Three) is DENIED;
4. Defendant’s Motion to Dismiss Plaintiffs’
Fraudulent Inducement claim (Count Four) is
GRANTED; and
5. Defendant’s Motion to Dismiss Plaintiffs’
Tortious Interference with Economic Advantage

claim (Count Five) is GRANTED.

22 To the extent not explicitly addressed, the Court has considered
the remainder of the Parties’ arguments in support of and in
opposition to the Dismissal Motion and, to the extent they were
not explicitly addressed, the Court finds them to be without merit.
IT IS FURTHER ORDERED that the parties are referred to
Magistrate Judge Tiscione for all pre-trial matters.
SO ORDERED.

/s/_JOANNA SEYBERT______
Joanna Seybert, U.S.D.J.

Dated: March 29, 2024
Central Islip, New York

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10311509. Public record. Not legal advice.