Gordon v. Equitas Capital Group

Background

McLean Gordon alleged that he began providing real estate services to Equitas Capital Group, LLC in July 2023 under the supervision of Alex Leykind. His work included underwriting loan scenarios, preparing lender materials, analyzing lender terms, supporting loan officers, and advising on loan placement.

Gordon alleged that the parties agreed by email that he would receive 10 percent of Equitas’s fees on specified loans after referral fees were paid. He further alleged that Leykind increased the rate to 17.5 percent on some deals in March 2024 and that the parties’ later dealings reflected those rates. According to Gordon, Equitas later said it would pay only 5 percent on several deals, and Leykind terminated his services after Gordon objected. Gordon alleged that his unpaid commissions totaled $328,375, of which Equitas had paid $10,500.

Gordon asserted claims for violations of New York City’s and New York State’s Freelance Isn’t Free Acts, breach of contract, breach of the implied covenant of good faith and fair dealing, unjust enrichment, account stated, and declaratory judgment. He alternatively alleged that he was misclassified as a freelancer and was actually an employee covered by the New York Labor Law.

Motion-to-dismiss standard

Equitas and Leykind moved to dismiss the First Amended Complaint under Federal Rule of Civil Procedure 12(b)(1), which concerns subject-matter jurisdiction, and Rule 12(b)(6), which concerns whether a complaint adequately states a legal claim. For purposes of the motion, the court accepted the complaint’s factual allegations as true and considered documents attached to or incorporated into the complaint.

Breach of contract and Statute of Frauds

The court held that the alleged commission agreement fell within New York’s Statute of Frauds. That law requires a signed writing for certain agreements, including agreements that cannot be performed within one year and agreements to pay compensation for services negotiating a loan. The court concluded that Gordon’s commission entitlement depended on loans closing, which depended on third parties, so the agreement fell within the one-year provision. The court also concluded that Gordon did not allege that he was licensed in New York or acted under the supervision of a New York broker, so he did not qualify on the face of the pleadings for the statutory broker exemption.

The court considered the July 2023 email, the June 2024 pipeline email, and other communications. It explained that an automatically generated email signature alone was insufficient. Although typed names or initials can sometimes satisfy the signing requirement, the writings must still contain substantially the whole agreement and all material terms. The court found that the emails attached to the First Amended Complaint did not adequately establish essential terms, including the scope of services and the commission rate across all deals. The court therefore dismissed the breach-of-contract claim without prejudice and with leave to amend.

Other non-labor claims

The court dismissed the implied-covenant claim without prejudice because Gordon had not sufficiently alleged an enforceable contract. The court also stated that, if Gordon amended the claim, he would need to allege specific conduct that was arbitrary, capricious, or designed to frustrate the contract’s purpose and seek damages distinct from those sought for breach of contract.

The court dismissed the unjust-enrichment claim with prejudice because Gordon did not address it in his opposition to the motion, which the court treated as abandonment. The court also noted that the claim duplicated the contract claim. The court dismissed the account-stated claim with prejudice for the same reason: Gordon did not oppose dismissal of that claim.

The court dismissed the declaratory-judgment claim without prejudice. It reasoned that deciding the contract claim would necessarily resolve whether a valid and enforceable contract existed and whether it had been breached, so a separate declaration would not provide additional clarification.

Freelance Isn’t Free Act and New York Labor Law claims

The court dismissed Gordon’s Freelance Isn’t Free Act claims without prejudice because those claims depended on an enforceable services contract, which Gordon had not adequately alleged.

The court also dismissed the New York Labor Law claims without prejudice. Gordon conceded that he had not adequately pleaded employee status under the relevant factors but stated that he could allege that Equitas misclassified him as an independent contractor when he was actually an employee. The court allowed him an opportunity to attempt that amendment.

Disposition and amendment

Judge Andrew L. Carter, Jr. granted defendants’ motion to dismiss. The court dismissed the unjust-enrichment and account-stated claims with prejudice. It dismissed the breach-of-contract, implied-covenant, declaratory-judgment, Freelance Isn’t Free Act, and New York Labor Law claims without prejudice. The court granted Gordon leave to file a Second Amended Complaint addressing the identified deficiencies by October 31, 2025.