LINKABLE NETWORKS INC v. MASTERCARD INC (2020)

Order, Supreme Court, New York County (O. Peter Sherwood, J.), entered on or about September 13, 2019, which, to the extent appealed from, granted defendants' motion to dismiss the first, second, third, fifth and sixth causes of action, and dismissed plaintiff's demand for punitive damages, unanimously affirmed, without costs.

The first, second, third and sixth causes of action (for misappropriation of trade secrets, unfair competition, misappropriation of ideas and unjust enrichment) were properly dismissed. The court correctly determined that these causes of action are “entirely based on alleged conduct that is proscribed by” contract;  hence, they are duplicative of plaintiff's contract claim (Bancorp Servs., LLC v. American Gen. Life Ins. Co., 2016 WL 4916969, *9, 2016 U.S. Dist LEXIS 18330, *29 [S.D. N.Y., Feb. 11, 2016, 14–CV–9687(VEC) ];  see also e.g. Nostrum Pharms., LLC v. Dixit, 2016 WL 5806781, *16, 2016 U.S. Dist LEXIS 133844, *51-52 [S.D. N.Y., Sept. 23, 2016, No. 13–cv–8718(CM) ] ). Tate & Lyle Ingredients Ams., Inc. v. Whitefox Tech. USA, Inc., 2011 N.Y. Slip Op. 33870[U], 2011 WL 11414185 [Sup. Ct., N.Y. County], affd on other grounds 98 A.D.3d 401, 949 N.Y.S.2d 375 [1st Dept. 2012] is distinguishable because, in that case, the “contract claim d[id] not mention or involve ․ trade secrets” (id. at *11).

“The statute of limitations for tortious interference ․ with prospective business relations is three years from the date of injury, which is triggered when a plaintiff first sustains damages” (Bandler v. DeYonker, 174 A.D.3d 461, 462, 101 N.Y.S.3d 847 [1st Dept. 2019], lv denied 35 N.Y.3d 901, 124 N.Y.S.3d 19, 146 N.E.3d 1178, 2020 N.Y. Slip Op. 65162 [March 31, 2020] ). Plaintiff alleges that defendants “sabotaged [its] current and prospective customer relationships” in 2015. Hence, it should have sued by December 31, 2018. However, it did not sue until April 3, 2019.

Plaintiff relies on its allegation that “[b]eginning in or about 2013, and continuing in or about September 2017, [it] had business relations with numerous current and prospective clients” (emphasis added). However, this merely alleges when plaintiff had those business relations, not when it first sustained damages.

We agree with the motion court's dismissal of plaintiff's demand for punitive damages. Here, the complaint fails to show that plaintiff is entitled to punitive damages, as it does not allege that defendants' actions were aimed at the public or “evinc[ed] a high degree of moral turpitude and demonstrat[ed] such wanton dishonesty as to imply a criminal indifference to civil obligations” (see Rocanova v. Equitable Life Assurance Society of the USA et. al., 83 N.Y.2d 603, 613, 612 N.Y.S.2d 339, 634 N.E.2d 940 [1994] [internal citations omitted];  Walker v. Sheldon, 10 N.Y.2d 401, 405, 223 N.Y.S.2d 488, 179 N.E.2d 497 [1961];  Errant Gene Therapeutics LLC v. Sloan–Kettering Institute for Cancer Research, 174 A.D.3d 473, 475–76, 106 N.Y.S.3d 302 [1st Dept. 2019] [dismissal of demand of punitive damages on a motion to dismiss] ).